![(TRANSAMERICA LOGO)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025703.gif)
Open Funds
Annual Report
October 31, 2008
October 31, 2008
www.transamericafunds.com
Customer Service 1-888-233-4339
P.O. Box 9012 • Clearwater, FL 33758-9012
Distributor: Transamerica Capital, Inc.
P.O. Box 9012 • Clearwater, FL 33758-9012
Distributor: Transamerica Capital, Inc.
Dear Fellow Shareholder,
On behalf of Transamerica Funds, I would like to thank you for your continued support and confidence in our products as we look forward to continuing to serve you and your financial advisor in the future. We value the trust you have placed in us.
This annual report is provided to you with the intent of presenting a comprehensive review of the investments of each of your funds. The Securities and Exchange Commission requires that annual and semi-annual reports be sent to all shareholders, and we believe this report to be an important part of the investment process. In addition to providing a comprehensive review, this report also provides a discussion of accounting policies as well as matters presented to shareholders that may have required their vote.
We believe it is important to recognize and understand current market conditions in order to provide a context for reading this report. Both equity and fixed-income markets have experienced extreme volatility and accelerating downward pricing pressure over the past twelve months as a credit crisis has had profound effects on the financial markets and has spilled over into the global economy. Oil prices rose dramatically throughout the first seven months of 2008 and have fallen precipitously since then as the global economy has struggled and demand has declined. The Federal Reserve has lowered the federal funds rate during the past twelve months from 4.25% in November 2007 to 1.00% at the end of October 2008 as it has sought to provide liquidity in a difficult market environment. The Treasury department has also been taking an active role in an effort to stabilize the markets, including the initiation of the Temporary Guarantee Program for Money Market Funds and the Troubled Assets Relief Program (TARP). The job market continues to struggle, as non-farm payrolls have weakened and the unemployment rate has risen to over 6%. In this environment, investors have flocked to money market instruments and Treasuries in a flight to quality. Many funds have struggled to produce positive returns. For the twelve months ending October 31, 2008, the Dow Jones Industrial Average returned -31.24%, the Standard & Poor’s 500 Index returned -36.10%, and the Barclays Capital US Aggregate Bond Index returned 0.30%. Please keep in mind it is important to maintain a diversified portfolio as investment returns have historically been difficult to predict.
In addition to your active involvement in the investment process, we firmly believe that a financial advisor is a key resource to help you build a complete picture of your current and future financial needs. Financial advisors are familiar with the market’s history, including long-term returns and volatility of various asset classes. With your financial advisor, you can develop an investment program that incorporates factors such as your goals, your investment timeline, and your risk tolerance.
Please contact your financial advisor if you have any questions about the contents of this report, and thanks again for the confidence you have placed in us.
Sincerely,
John K. Carter | Christopher A. Staples, CFA | |
President & Chief Executive Officer | Vice President & Chief Investment Officer | |
Transamerica Funds | Transamerica Funds |
The views expressed in this report reflect those of the portfolio managers only and may not necessarily represent the views of Transamerica Funds. These views are subject to change based upon market conditions. These views should not be relied upon as investment advice and are not indicative of trading intent on behalf of Transamerica Funds.
Transamerica Balanced
(unaudited)
(unaudited)
MARKET ENVIRONMENT
Faced with many challenges in the twelve months ended October 31, 2008, US equity indices delivered double-digit negative returns across the board. Stocks underperformed bonds, as the Standard and Poor’s 500 Composite Stock Index (“S&P 500”) declined 36.10% and the Barclays Capital (formerly Lehman Brothers) US Government/Credit Bond Index (“BCGC”) fell 1.06%.
Throughout the period, problems plaguing the housing market continued, while commodity prices first soared then plummeted. Meanwhile, what began as concerns about securities related to defaulting sub-prime mortgages escalated into a variety of increasingly severe crises in the markets where banks lend to each other and to businesses, causing extreme disruption in both US and foreign financial markets. As the problems multiplied, financial institutions tightened their lending standards. The higher borrowing costs made it more difficult for companies to fund payroll, inventory and other near-term expenses. Consumers, who already were feeling the effects of higher energy and food prices and rising unemployment, also found it more difficult to borrow. Although the Federal Reserve Board (“Fed”) and the US government intervened to restore confidence in the financial systems, the US headed toward recession and expectations of a global economic slowdown increased.
A 60% equity/40% bond blend of the above mentioned indices declined 23.39% during the period.
PERFORMANCE
For the year ended October 31, 2008, Transamerica Balanced Class A returned (33.55)%. By comparison, its primary and secondary benchmarks, the S&P 500 and the BCGC, returned (36.10)% and (1.06)%, respectively.
STRATEGY REVIEW
Transamerica Balanced’s twelve-month return reflects an overweighting in equities, which underperformed bonds, and underperformance of the equity and bond portfolios as compared to their respective benchmarks.
On the equity side, the key factors in the lagging returns were our underweighting in the top-performing consumer staples sector and poor results for some of our automotive/transportation holdings (e.g., Daimler AG (“Daimler”)). Daimler suffered during the year due primarily to the downward trend in automotive sales worldwide and the lack of financing available to consumers. Partially offsetting these declines were our selections in the healthcare (e.g., Gilead Sciences, Inc. (“Gilead”)) and producer durables (e.g., W.W. Grainger, Inc. (“Grainger”)) sectors. Gilead, a biopharmaceutical company working on treatments for cures to life-threatening diseases, has benefited from competitors being merged, which reduced its competition. Grainger, a building maintenance supply company, has implemented improvement projects within its businesses. This company-specific catalyst enabled Grainger to take market share from competitors, partially offsetting the effects of a weaker economy. The portfolio also benefited from our underweighting the financials sector.
In the bond portfolio, an overweighting of non-government sectors (i.e., investment-grade corporate securities and agency mortgage securities), which lagged the Treasury sector, was the primary source of underperformance. The negative effect of these overweightings was partially mitigated by our individual security selection. Among investment-grade corporate bonds, we had no exposure to the most distressed companies in the troubled financial services sector. On the mortgage side, our emphasis was on short- duration agency collateralized mortgage obligations, which were less volatile than other mortgage securities.
We believe a consumer-driven recession has already arrived. We believe the federal government’s $700-billion rescue of the financial services sector, the biggest government intervention in the financial system since the 1930s, should provide some much-needed rationality in the markets. We believe it should help to rebuild trust among financial institutions and reduce the severity of the recession. The equity portfolio is populated with securities of companies that, in our opinion, have capable management teams, strong balance sheets and highly competitive positions, and that stand to benefit from long-term secular trends. We believe these traits will allow the companies to weather a recession better than most and emerge as stronger competitors on the other side. On the bond side, we are maintaining a relatively cautious stance, with a shorter-than-index duration and a focus on quality.
Gary U. Rollé, CFA
Greg D. Haendel, CFA
Derek S. Brown, CFA
Geoffrey I. Edelstein, CFA, CIC
Edward S. Han
John J. Huber, CFA
Peter O. Lopez
Erik U. Rollé
Brian W. Westhoff, CFA
Greg D. Haendel, CFA
Derek S. Brown, CFA
Geoffrey I. Edelstein, CFA, CIC
Edward S. Han
John J. Huber, CFA
Peter O. Lopez
Erik U. Rollé
Brian W. Westhoff, CFA
Co-Portfolio Managers
Transamerica Investment Management, LLC
Transamerica Investment Management, LLC
Prior to October 1, 2008, Heidi Y. Hu, CFA was also a co-portfolio manager.
1
![(LINE GRAPH)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025717.gif)
Average Annual Total Return for Periods Ended 10/31/2008
From | Inception | |||||||||||||||||||
1 Year | 5 Years | 10 Years | Inception | Date | ||||||||||||||||
Class A (NAV) | (33.55 | )% | 0.12 | % | 2.83 | % | 7.24 | % | 12/2/94 | |||||||||||
Class A (POP) | (37.22 | )% | (1.00 | )% | 2.24 | % | 6.81 | % | 12/2/94 | |||||||||||
S&P 500(1) | (36.10 | )% | 0.26 | % | 0.40 | % | 7.56 | % | 12/2/94 | |||||||||||
Barclays Capital Government/Credit Bond Index(1) | (1.06 | )% | 3.08 | % | 4.81 | % | 6.36 | % | 12/2/94 | |||||||||||
Class B (NAV) | (33.95 | )% | (0.45 | )% | 2.32 | % | 6.13 | % | 10/1/95 | |||||||||||
Class B (POP) | (37.15 | )% | (0.64 | )% | 2.32 | % | 6.13 | % | 10/1/95 | |||||||||||
Class C (NAV) | (33.92 | )% | (0.45 | )% | N/A | 0.89 | % | 11/11/02 | ||||||||||||
Class C (POP) | (34.56 | )% | (0.45 | )% | N/A | 0.89 | % | 11/11/02 |
NOTES | ||
(1) | The Standard and Poor’s 500 Composite Stock Index (S&P 500) and the Barclays Capital Government/Credit Bond Index are unmanaged indices used as a general measure of market performance. Calculations assume dividends and capital gains are reinvested and do not include any managerial expenses. You cannot invest directly in an index. |
The performance data presented represents past performance; future results may vary. Performance data does not reflect the deduction of taxes that would be paid on fund distributions or the redemption of fund shares. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than performance quoted. Please see www.transamericafunds.com for performance data current to the most recent month-end. Public Offering Price (POP) returns include the reinvestment of dividends and capital gains and reflect the maximum sales charge of 5.5% for A shares or the maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 6 years) for Class B shares and 1% (during the first 12 months) for Class C shares. Shares purchased prior to March 1, 2004 are subject to a maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 7 years) for Class B shares and (2% in the 1st year, decreasing to 0% after 2 years) for Class C shares. Net Asset Value (NAV) returns include the reinvestment of dividends and capital gains but do not reflect any sales charges.
This material must be preceded or accompanied by a current prospectus, which includes specific contents regarding the investment objectives and policies of this fund.
2
UNDERSTANDING YOUR FUND’S EXPENSES
(unaudited)
(unaudited)
SHAREHOLDER EXPENSES
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, contingent deferred sales charges on redemptions and redemption fees; and (2) ongoing costs, including management fees, 12b-1 distribution and service fees, and other fund expenses.
The following Example is intended to help you understand your ongoing costs (in dollars and cents) of investing in the Fund and to compare these costs with the ongoing costs of investing in other funds.
The Example is based on an investment of $1,000 invested at May 1, 2008 and held for the entire period until October 31, 2008.
ACTUAL EXPENSES
The first line in the table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line of your Fund under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. If your account is an IRA, your expenses could have included a $15 annual fee. The amount of any fee paid through your account would increase the estimate of expenses you paid during the period and decrease your ending account value.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line in the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. As in the case of the actual expense example, if your account is subject to an IRA fee, the amount of the fee paid through your account would increase the hypothetical expenses you would have paid during the period and decrease the hypothetical ending account value.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges, redemption fees, brokerage commissions paid on purchases and sales of fund shares. Therefore, the second line under the Fund in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. If any of these transaction costs were included, your costs would be higher. The expenses shown in the table do not reflect any fees that may be charged to you by brokers, financial intermediaries or other financial institutions.
Beginning | Ending | Annualized | Expenses | |||||||||||||
Account | Account | Expense | Paid During | |||||||||||||
Value | Value | Ratio | Period (a) | |||||||||||||
Class A | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 728.23 | 1.52 | % | $ | 6.60 | ||||||||
Hypothetical (b) | 1,000.00 | 1,017.50 | 1.52 | 7.71 | ||||||||||||
Class B | ||||||||||||||||
Actual | 1,000.00 | 726.50 | 2.13 | 9.24 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,014.43 | 2.13 | 10.79 | ||||||||||||
Class C | ||||||||||||||||
Actual | 1,000.00 | 726.46 | 2.06 | 8.94 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,014.78 | 2.06 | 10.43 |
(a) | Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days), and divided by the number of days in the year (366 days). | |
(b) | 5% return per year before expenses. |
GRAPHICAL PRESENTATION OF SCHEDULE OF INVESTMENTS
By Asset Type
At October 31, 2008
(unaudited)
By Asset Type
At October 31, 2008
(unaudited)
![(PIE CHART)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025718.gif)
This chart shows the percentage breakdown by Asset Type of the Fund’s total investment securities. Percentage breakdown of the Short-term category includes Securities Lending Collateral.
3
SCHEDULE OF INVESTMENTS
At October 31, 2008
(all amounts except share amounts in thousands)
At October 31, 2008
(all amounts except share amounts in thousands)
Principal | Value | |||||||
U.S. GOVERNMENT OBLIGATIONS (5.1%) | ||||||||
U.S. Treasury Bond | ||||||||
4.38%, due 02/15/2038 ^ | $ | 1,202 | $ | 1,205 | ||||
5.00%, due 05/15/2037 ^ | 1,774 | 1,954 | ||||||
U.S. Treasury Inflation Indexed Note | ||||||||
1.38%, due 07/15/2018 ^ | 452 | 387 | ||||||
U.S. Treasury Note | ||||||||
2.00%, due 09/30/2010 | 250 | 252 | ||||||
3.88%, due 05/15/2018 ^ | 714 | 713 | ||||||
4.00%, due 08/15/2018 ^ | 627 | 628 | ||||||
Total U.S. Government Obligations (cost $5,157) | 5,139 | |||||||
U.S. GOVERNMENT AGENCY OBLIGATIONS (7.5%) | ||||||||
Fannie Mae | ||||||||
5.00%, due 04/25/2034 | 700 | 665 | ||||||
5.50%, due 10/01/2036 - 04/01/2038 | 2,506 | 2,450 | ||||||
Freddie Mac | ||||||||
4.25%, due 10/15/2026 | 826 | 824 | ||||||
5.00%, due 05/15/2028 - 10/15/2030 | 2,500 | 2,471 | ||||||
5.35%, due 11/14/2011 | 1,070 | 1,071 | ||||||
Total U.S. Government Agency Obligations (cost $7,537) | 7,481 | |||||||
MORTGAGE-BACKED SECURITIES (3.1%) | ||||||||
Bear Stearns Commercial Mortgage Securities | ||||||||
Series 2006-PW14, Class A4 | ||||||||
5.20%, due 12/11/2038 | 750 | 563 | ||||||
Crown Castle Towers LLC | ||||||||
Series 2006-1A, Class AFX | ||||||||
5.24%, due 11/15/2036 -144A | 739 | 710 | ||||||
Morgan Stanley Capital I | ||||||||
Series 2006-HQ10, Class A4 | ||||||||
5.33%, due 11/12/2041 | 750 | 568 | ||||||
SBA CMBS Trust | ||||||||
Series 2006-1A, Class A | ||||||||
5.31%, due 11/15/2036 -144A | 680 | 637 | ||||||
Wachovia Bank Commercial Mortgage Trust | ||||||||
Series 2006-C28, Class A4 | ||||||||
5.57%, due 10/15/2048 | 734 | 559 | ||||||
Series 2007-C32, Class H | ||||||||
5.74%, due 06/15/2049 -144A | 245 | 65 | ||||||
Total Mortgage-Backed Securities (cost $3,880) | 3,102 | |||||||
ASSET-BACKED SECURITY (0.6%) | ||||||||
USAA Auto Owner Trust | ||||||||
Series 2007-2, Class A3 | ||||||||
4.90%, due 02/15/2012 | 605 | 596 | ||||||
Total Asset-Backed Security (cost $605) | 596 | |||||||
CORPORATE DEBT SECURITIES (22.9%) | ||||||||
Aerospace & Defense (0.9%) | ||||||||
Embraer Overseas, Ltd. | ||||||||
6.38%, due 01/24/2017 | 250 | 162 | ||||||
Honeywell International, Inc. | ||||||||
6.13%, due 11/01/2011 | 660 | 662 | ||||||
Airlines (0.2%) | ||||||||
Delta Air Lines, Inc. | ||||||||
7.57%, due 11/18/2010 | 270 | 224 | ||||||
Automobiles (0.8%) | ||||||||
Daimler Finance North America LLC | ||||||||
3.25%, due 03/13/2009 * | 405 | 385 | ||||||
7.20%, due 09/01/2009 | 460 | 427 | ||||||
Beverages (1.9%) | ||||||||
Coca-Cola Enterprises, Inc. | ||||||||
3.31%, due 05/06/2011 * | 480 | 463 | ||||||
Diageo Capital PLC | ||||||||
5.75%, due 10/23/2017 | 458 | 394 | ||||||
Molson Coors Capital Finance | ||||||||
4.85%, due 09/22/2010 | 485 | 486 | ||||||
Sabmiller PLC | ||||||||
6.20%, due 07/01/2011 -144A | 460 | 467 | ||||||
Capital Markets (0.7%) | ||||||||
Lazard Group | ||||||||
7.13%, due 05/15/2015 | 385 | 303 | ||||||
Merrill Lynch & Co., Inc. | ||||||||
5.45%, due 02/05/2013 | 475 | 428 | ||||||
Chemicals (2.4%) | ||||||||
ICI Wilmington, Inc. | ||||||||
4.38%, due 12/01/2008 | 791 | 791 | ||||||
Lubrizol Corp. | ||||||||
4.63%, due 10/01/2009 | 1,350 | 1,301 | ||||||
PPG Industries, Inc. | ||||||||
5.75%, due 03/15/2013 | 280 | 261 | ||||||
Commercial Banks (1.0%) | ||||||||
Barclays Bank PLC | ||||||||
7.70%, due 04/25/2018 -144A ■ Ž | 395 | 274 | ||||||
PNC Bank NA | ||||||||
6.00%, due 12/07/2017 | 250 | 217 | ||||||
6.88%, due 04/01/2018 | 270 | 249 | ||||||
Wells Fargo Bank NA | ||||||||
5.75%, due 05/16/2016 ^ | 300 | 269 | ||||||
Construction Materials (0.2%) | ||||||||
Lafarge SA | ||||||||
7.13%, due 07/15/2036 | 255 | 183 | ||||||
Consumer Finance (0.7%) | ||||||||
American Honda Finance Corp. | ||||||||
5.13%, due 12/15/2010 -144A | 450 | 440 | ||||||
Discover Financial Services | ||||||||
3.35%, due 06/11/2010 * | 432 | 307 | ||||||
Containers & Packaging (0.3%) | ||||||||
Rexam PLC | ||||||||
6.75%, due 06/01/2013 -144A | 315 | 309 | ||||||
Diversified Financial Services (0.7%) | ||||||||
Glencore Funding LLC | ||||||||
6.00%, due 04/15/2014 -144A | 292 | 276 | ||||||
Pemex Finance, Ltd. | ||||||||
9.03%, due 02/15/2011 | 425 | 428 | ||||||
Diversified Telecommunication Services (1.1%) | ||||||||
AT&T, Inc. | ||||||||
4.13%, due 09/15/2009 | 304 | 301 | ||||||
Telefonica Europe BV | ||||||||
7.75%, due 09/15/2010 | 415 | 402 | ||||||
Verizon Communications, Inc. | ||||||||
8.75%, due 11/01/2018 | 435 | 444 | ||||||
Food & Staples Retailing (0.2%) | ||||||||
Stater Brothers Holdings, Inc. | ||||||||
8.13%, due 06/15/2012 | 225 | 200 | ||||||
Food Products (1.0%) | ||||||||
Bunge, Ltd. Finance Corp. | ||||||||
4.38%, due 12/15/2008 | 500 | 498 | ||||||
Cargill, Inc. | ||||||||
5.60%, due 09/15/2012 -144A | 225 | 209 |
The notes to the financial statements are an integral part of this report.
4
Principal | Value | |||||||
Food Products (continued) | ||||||||
Michael Foods, Inc. | ||||||||
8.00%, due 11/15/2013 | $ | 320 | $ | 277 | ||||
Hotels, Restaurants & Leisure (0.2%) | ||||||||
Royal Caribbean Cruises, Ltd. | ||||||||
8.75%, due 02/02/2011 | 252 | 217 | ||||||
Household Products (0.2%) | ||||||||
Kimberly-Clark Corp. | ||||||||
6.63%, due 08/01/2037 | 250 | 220 | ||||||
Industrial Conglomerates (0.4%) | ||||||||
Hutchison Whampoa International, Ltd. | ||||||||
5.45%, due 11/24/2010 -144A | 450 | 425 | ||||||
Insurance (0.6%) | ||||||||
Hartford Financial Services Group, Inc. | ||||||||
7.90%, due 06/15/2010 | 525 | 513 | ||||||
Oil Insurance, Ltd. | ||||||||
7.56%, due 06/30/2011 -144A ■ Ž | 270 | 137 | ||||||
IT Services (0.4%) | ||||||||
Western Union Co. | ||||||||
5.40%, due 11/17/2011 | 450 | 438 | ||||||
Machinery (0.3%) | ||||||||
Tyco Electronics Group SA | ||||||||
6.55%, due 10/01/2017 | 392 | 326 | ||||||
Media (1.0%) | ||||||||
Comcast Corp. | ||||||||
7.05%, due 03/15/2033 | 325 | 269 | ||||||
Historic TW, Inc. | ||||||||
9.13%, due 01/15/2013 | 485 | 466 | ||||||
News America Holdings, Inc. | ||||||||
7.75%, due 12/01/2045 | 262 | 219 | ||||||
Metals & Mining (0.4%) | ||||||||
Arcelormittal | ||||||||
5.38%, due 06/01/2013 -144A | 440 | 358 | ||||||
Multiline Retail (0.3%) | ||||||||
Neiman-Marcus Group, Inc. | ||||||||
9.00%, due 10/15/2015 ^ | 200 | 137 | ||||||
Target Corp. | ||||||||
7.00%, due 01/15/2038 | 242 | 185 | ||||||
Multi-Utilities (0.5%) | ||||||||
Sempra Energy | ||||||||
4.75%, due 05/15/2009 | 480 | 473 | ||||||
Oil, Gas & Consumable Fuels (2.6%) | ||||||||
Burlington Resources Finance Co. | ||||||||
6.50%, due 12/01/2011 | 450 | 450 | ||||||
Enterprise Products Operating, LP | ||||||||
4.63%, due 10/15/2009 | 320 | 306 | ||||||
Kinder Morgan Energy Partners, LP | ||||||||
7.50%, due 11/01/2010 | 455 | 435 | ||||||
Petrobras International Finance Co. | ||||||||
5.88%, due 03/01/2018 | 280 | 220 | ||||||
PetroHawk Energy Corp. | ||||||||
9.13%, due 07/15/2013 | 360 | 277 | ||||||
Teppco Partners, LP | ||||||||
7.00%, due 06/01/2067 ■ | 300 | 207 | ||||||
Valero Logistics Operations, LP | ||||||||
6.88%, due 07/15/2012 | 710 | 725 | ||||||
Pharmaceuticals (0.4%) | ||||||||
Allergan, Inc. | ||||||||
5.75%, due 04/01/2016 | 445 | 397 | ||||||
Real Estate Investment Trusts (2.3%) | ||||||||
BRE Properties, Inc. | ||||||||
5.75%, due 09/01/2009 | 1,115 | 1,088 | ||||||
PPF Funding, Inc. | ||||||||
5.35%, due 04/15/2012 -144A | 781 | 737 | ||||||
Wea Finance LLC / WCI Finance LLC | ||||||||
5.40%, due 10/01/2012 -144A | 520 | 453 | ||||||
Real Estate Management & Development (0.6%) | ||||||||
Post Apartment Homes, LP | ||||||||
6.30%, due 06/01/2013 | 569 | 559 | ||||||
Road & Rail (0.6%) | ||||||||
Erac USA Finance Co. | ||||||||
6.38%, due 10/15/2017 -144A | 335 | 205 | ||||||
Hertz Corp. | ||||||||
8.88%, due 01/01/2014 | 200 | 146 | ||||||
Union Pacific Corp. | ||||||||
5.70%, due 08/15/2018 | 350 | 294 | ||||||
Total Corporate Debt Securities (cost $25,560) | 22,919 | |||||||
Shares | ||||||||
COMMON STOCKS (58.2%) | ||||||||
Aerospace & Defense (1.0%) | ||||||||
Boeing Co. ^ | 20,000 | 1,045 | ||||||
Air Freight & Logistics (1.6%) | ||||||||
Expeditors International of Washington, Inc. ^ | 50,000 | 1,632 | ||||||
Auto Components (2.4%) | ||||||||
BorgWarner, Inc. ^ | 50,000 | 1,124 | ||||||
Johnson Controls, Inc. | 72,000 | 1,277 | ||||||
Biotechnology (2.1%) | ||||||||
Gilead Sciences, Inc. ‡ ^ | 46,000 | 2,109 | ||||||
Capital Markets (7.0%) | ||||||||
BlackRock, Inc. ^ | 12,000 | 1,576 | ||||||
Charles Schwab Corp. ^ | 130,000 | 2,486 | ||||||
Merrill Lynch & Co., Inc. ^ | 70,000 | 1,301 | ||||||
T. Rowe Price Group, Inc. ^ | 39,843 | 1,575 | ||||||
Chemicals (1.7%) | ||||||||
Sigma-Aldrich Corp. ^ | 40,000 | 1,754 | ||||||
Communications Equipment (2.5%) | ||||||||
Qualcomm, Inc. | 65,000 | 2,487 | ||||||
Computers & Peripherals (2.7%) | ||||||||
Apple, Inc. ‡ ^ | 25,000 | 2,690 | ||||||
Construction & Engineering (1.2%) | ||||||||
Jacobs Engineering Group, Inc. ‡ ^ | 32,000 | 1,166 | ||||||
Consumer Finance (1.0%) | ||||||||
American Express Co. | 35,000 | 963 | ||||||
Diversified Financial Services (0.8%) | ||||||||
CME Group, Inc. ^ | 2,800 | 790 | ||||||
Diversified Telecommunication Services (2.5%) | ||||||||
Verizon Communications, Inc. ^ | 85,000 | 2,522 | ||||||
Electronic Equipment & Instruments (1.6%) | ||||||||
Tyco Electronics, Ltd. | 85,000 | 1,652 | ||||||
Energy Equipment & Services (0.9%) | ||||||||
Schlumberger, Ltd. ^ | 18,000 | 930 | ||||||
Food & Staples Retailing (2.0%) | ||||||||
Costco Wholesale Corp. ^ | 35,000 | 1,995 | ||||||
Health Care Equipment & Supplies (3.3%) | ||||||||
Becton Dickinson & Co. | 21,555 | 1,496 | ||||||
Varian Medical Systems, Inc. ‡ ^ | 40,000 | 1,820 | ||||||
Industrial Conglomerates (1.6%) | ||||||||
General Electric Co. | 80,000 | 1,561 | ||||||
Internet & Catalog Retail (2.0%) | ||||||||
Amazon.com, Inc. ‡ ^ | 35,000 | 2,003 |
The notes to the financial statements are an integral part of this report.
5
Shares | Value | |||||||
Internet Software & Services (2.2%) | ||||||||
Google, Inc. -Class A ‡ | 6,000 | $ | 2,156 | |||||
Machinery (4.5%) | ||||||||
Caterpillar, Inc. ^ | 30,000 | 1,145 | ||||||
Kennametal, Inc. | 80,000 | 1,698 | ||||||
PACCAR, Inc. ^ | 60,000 | 1,754 | ||||||
Oil, Gas & Consumable Fuels (1.1%) | ||||||||
Anadarko Petroleum Corp. | 30,000 | 1,059 | ||||||
Pharmaceuticals (1.0%) | ||||||||
Allergan, Inc. | 25,000 | 992 | ||||||
Road & Rail (2.3%) | ||||||||
Burlington Northern Santa Fe Corp. | 26,000 | 2,316 | ||||||
Semiconductors & Semiconductor Equipment (1.8%) | ||||||||
Intel Corp. | 111,000 | 1,776 | ||||||
Software (4.4%) | ||||||||
Adobe Systems, Inc. ‡ | 90,000 | 2,398 | ||||||
Oracle Corp. ‡ | 60,000 | 1,097 | ||||||
Salesforce.com, Inc. ‡ ^ | 30,000 | 929 | ||||||
Trading Companies & Distributors (3.0%) | ||||||||
WW Grainger, Inc. ^ | 38,500 | 3,025 | ||||||
Total Common Stocks (cost $72,778) | $ | 58,299 | ||||||
Principal | ||||||||
REPURCHASE AGREEMENT (7.0%) | ||||||||
State Street Repurchase Agreement 0.15%, dated 10/31/2008, to be repurchased at $6,973 on 11/03/2008 à • | $ | 6,973 | 6,973 | |||||
Total Repurchase Agreement (cost $6,973) | 6,973 | |||||||
Shares | ||||||||
SECURITIES LENDING COLLATERAL (25.8%) | ||||||||
State Street Navigator Securities Lending Trust — Prime Portfolio, 2.71% à ▲ | 25,791,082 | 25,791 | ||||||
Total Securities Lending Collateral (cost $25,791) | 25,791 | |||||||
Total Investment Securities (cost $148,281) # | $ | 130,300 | ||||||
NOTES TO SCHEDULE OF INVESTMENTS: | ||
^ | All or a portion of this security is on loan. The value of all securities on loan is $25,194. | |
* | Floating or variable rate note. Rate is listed as of 10/31/2008. | |
Ž | The security has a perpetual maturity. The date shown is the next call date. | |
■ | Coupon rate is fixed for a predetermined period of time and then converts to a floating rate until maturity/call date. Rate is listed as of 10/31/2008. | |
‡ | Non-income producing security. | |
• | Repurchase agreement is collateralized by U.S. Government Agency Obligations with interest rates ranging from 3.56% to 3.94%, maturity dates ranging between 10/25/2036 — 08/01/2037, and with market values plus accrued interests of $7,115. | |
à | State Street Bank & Trust Company serves as the accounting, custody, and lending agent for the Fund and provides various services on behalf of the Fund. | |
▲ | Interest rate shown reflects the yield at 10/31/2008. | |
# | Aggregate cost for federal income tax purposes is $148,381. Aggregate gross unrealized appreciation/depreciation for all securities in which there is an excess of value over tax cost were $3,474 and $21,555, respectively. Net unrealized depreciation for tax purposes is $18,081. |
DEFINITIONS:
144A | 144A Securities are registered pursuant to Rule 144A of the Securities Act of 1933. These securities are deemed to be liquid for purposes of compliance limitations on holdings of illiquid securities and may be resold as transactions exempt from registration, normally to qualified institutional buyers. At 10/31/2008, these securities aggregated $5,702, or 5.70% of the Fund’s net assets. | |
LLC | Limited Liability Company | |
LP | Limited Partnership | |
PLC | Public Limited Company |
The notes to the financial statements are an integral part of this report.
6
Transamerica Convertible Securities
(unaudited)
(unaudited)
MARKET ENVIRONMENT
Faced with many challenges in the twelve months ended October 31, 2008, US stocks lost ground, and the Standard and Poor’s 500 Composite Stock Index (“S&P 500”) declined 36.10%. Convertibles, which are highly sensitive to equity-market trends, followed stocks lower; the Merrill Lynch All US Convertible Securities Index (“MLCI”) declined 38.49%.
What began as concerns about securities related to defaulting sub-prime mortgages escalated into a variety of increasingly severe credit crises. Overnight lending between banks, a vital part of maintaining the flow of capital in the financial system, was disrupted as banks increasingly worried about undisclosed risks from exotic securities. As credit problems multiplied, financial institutions focused on protecting their financial positions and demanded higher yields on corporate debt to compensate for the greater risk associated with the uncertain environment. This made it more difficult and expensive for businesses to issue debt, causing Wall Street’s problems to spill over to Main Street, where businesses were already dealing with the signs of a slowing economy, including falling home prices, rising costs for food and energy, higher unemployment, lack of wage growth and tighter credit conditions. Although the Federal Reserve Board (“Fed”) and the US government intervened on several occasions, taking somewhat unprecedented measures, the credit crisis persisted and the economic outlook continued to dim.
Convertibles generally fare better than stocks during equity bear markets. That was not the case toward the end of the period. To raise cash, large institutional holders of convertibles (e.g., hedge funds) sold convertibles in volume. Additionally, corporate debt yields climbed, reducing the value of convertibles’ debt component.
PERFORMANCE
For the year ended October 31, 2008, Transamerica Convertible Securities Class A returned (38.92)%. By comparison, its benchmark, the MLCI returned (38.49)%.
STRATEGY REVIEW
We seek the convertibles of well-run companies that generate free cash flow and stand to benefit from positive changes in the companies, their industries, or the external forces driving their businesses. These parameters led us to trim back the portfolio’s investments in securities from consumer discretionary companies, many of which were very susceptible to the worsening economy. This benefited the portfolio late in the period, as the poor economic situation became increasingly apparent. Also working to the portfolio’s advantage was an increased focus on securities from companies whose business models allowed them to weather the economic downturn relatively well. Among the portfolio’s large contributors to results was Gilead Sciences, Inc. (“Gilead”), a biopharmaceutical company. Gilead, which develops and markets treatments for diseases such as hepatitis C and HIV, saw steady product demand. Another top-performer was Informatica Corporation, a software company providing enterprise data integration. The company receives recurring cash flows from licensing and maintaining its software programs.
A key detractor was the portfolio’s overweighting in the energy sector. Early in the period, as commodity prices soared, our selections in natural gas producer Chesapeake Energy Corporation and oil services provider Schlumberger Limited (“Schlumberger”) garnered positive returns. When commodity prices later declined, performance in this sector followed suit.
We believe a consumer-driven recession has already arrived. We believe the federal government’s $700-billion rescue of the financial services sector should provide some much-needed rationality in the markets. We believe it should help to rebuild trust among financial institutions and serve to shorten or at least reduce the severity of the recession. In the interim, market conditions likely will not be favorable. With that in mind, we are seeking securities of non-cyclical businesses that we believe benefit from long-term secular trends and thus can hold their own amidst the turbulence.
Kirk J. Kim
Peter O. Lopez
Peter O. Lopez
Co- Portfolio Managers
Transamerica Investment Management, LLC
Transamerica Investment Management, LLC
7
![(LINE GRAPH)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025719.gif)
Average Annual Total Return for Periods Ended 10/31/2008
From | Inception | |||||||||||||||
1 Year | 5 Years | Inception | Date | |||||||||||||
Class A (NAV) | (38.92) | % | 0.41 | % | 2.67 | % | 3/1/02 | |||||||||
Class A (POP) | (41.81) | % | (0.55) | % | 1.92 | % | 3/1/02 | |||||||||
Merrill Lynch All U.S. Convertible Securities Index(1) | (38.49) | % | (2.39) | % | 0.42 | % | 3/1/02 | |||||||||
Class B (NAV) | (39.32) | % | (0.29) | % | 1.98 | % | 3/1/02 | |||||||||
Class B (POP) | (41.66) | % | (0.42) | % | 1.98 | % | 3/1/02 | |||||||||
Class C (NAV) | (39.24) | % | (0.29) | % | 3.25 | % | 11/11/02 | |||||||||
Class C (POP) | (39.71) | % | (0.29) | % | 3.25 | % | 11/11/02 | |||||||||
Class I (NAV) | (38.58) | % | N/A | (4.39 | )% | 11/15/05 |
NOTES | ||
(1) | The Merrill Lynch All U.S. Convertibles Index is an unmanaged index used as a general measure of market performance. Calculations assume dividends and capital gains are reinvested and do not include any managerial expenses. You cannot directly invest in an index. |
The performance data presented represents past performance; future results may vary. Performance data does not reflect the deduction of taxes that would be paid on fund distributions or the redemption of fund shares. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than performance quoted. Please see www.transamericafunds.com for performance data current to the most recent month-end. Public Offering Price (POP) returns include the reinvestment of dividends and capital gains and reflect the maximum sales charge of 4.75% for A shares or the maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 6 years) for Class B shares and 1% (during the first 12 months) for Class C shares. Shares purchased prior to March 1, 2004 are subject to a maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 7 years) for Class B shares and (2% in the 1st year, decreasing to 0% after 2 years) for Class C shares. Net Asset Value (NAV) returns include the reinvestment of dividends and capital gains but do not reflect any sales charges.
This material must be preceded or accompanied by a current prospectus, which includes specific contents regarding the investment objectives and policies of this Fund.
8
UNDERSTANDING YOUR FUND’S EXPENSES
(unaudited)
(unaudited)
SHAREHOLDER EXPENSES
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, contingent deferred sales charges on redemptions and redemption fees; and (2) ongoing costs, including management fees, 12b-1 distribution and service fees, and other fund expenses.
The following Example is intended to help you understand your ongoing costs (in dollars and cents) of investing in the Fund and to compare these costs with the ongoing costs of investing in other funds.
The Example is based on an investment of $1,000 invested at May 1, 2008 and held for the entire period until October 31, 2008.
ACTUAL EXPENSES
The first line in the table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line of your Fund under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. If your account is an IRA, your expenses could have included a $15 annual fee. The amount of any fee paid through your account would increase the estimate of expenses you paid during the period and decrease your ending account value.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line in the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypotetical examples that appear in the shareholder reports of the other funds. As in the case of the actual expense example, if your account is subject to an IRA fee, the amount of the fee paid through your account would increase the hypothetical expenses you would have paid during the period and decrease the hypothetical ending account value.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges, redemption fees, brokerage commissions paid on purchases and sales of fund shares. Therefore, the second line under the Fund in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. If any of these transaction costs were included, your costs would be higher. The expenses shown in the table do not reflect any fees that may be charged to you by brokers, financial intermediaries or other financial institutions.
Beginning | Ending | Annualized | Expenses | |||||||||||||
Account | Account | Expense | Paid During | |||||||||||||
Value | Value | Ratio | Period (a) | |||||||||||||
Class A | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 675.14 | 1.35 | % | $ | 5.68 | ||||||||
Hypothetical (b) | 1,000.00 | 1,018.35 | 1.35 | 6.85 | ||||||||||||
Class B | ||||||||||||||||
Actual | 1,000.00 | 672.93 | 2.04 | 8.58 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,014.88 | 2.04 | 10.33 | ||||||||||||
Class C | ||||||||||||||||
Actual | 1,000.00 | 673.77 | 1.95 | 8.20 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,015.33 | 1.95 | 9.88 | ||||||||||||
Class I | ||||||||||||||||
Actual | 1,000.00 | 677.22 | 0.84 | 3.54 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,020.91 | 0.84 | 4.27 |
(a) | Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days), and divided by the number of days in the year (366 days). | |
(b) | 5% return per year before expenses. |
GRAPHICAL PRESENTATION OF SCHEDULE OF INVESTMENTS
By Investment Type
At October 31, 2008
(unaudited)
By Investment Type
At October 31, 2008
(unaudited)
![(PIE CHART)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025720.gif)
This chart shows the percentage breakdown by Investment Type of the Fund’s total investment securities. Percentage breakdown of the Short-term category includes Securities Lending Collateral.
9
SCHEDULE OF INVESTMENTS
At October 31, 2008
(all amounts except share amounts in thousands)
At October 31, 2008
(all amounts except share amounts in thousands)
Principal | Value | |||||||
CORPORATE DEBT SECURITIES (3.1%) | ||||||||
Automobiles (1.6%) | ||||||||
Daimler Finance North America LLC | ||||||||
3.17%, due 03/13/2009 * | $ | 1,955 | $ | 1,839 | ||||
Hotels, Restaurants & Leisure (1.5%) | ||||||||
MGM Mirage, Inc. | ||||||||
6.00%, due 10/01/2009 | 1,950 | 1,735 | ||||||
Total Corporate Debt Securities (cost $3,533) | 3,574 | |||||||
Shares | ||||||||
CONVERTIBLE PREFERRED STOCKS (11.8%) | ||||||||
Capital Markets (1.7%) | ||||||||
Credit Suisse, Inc. 5.50% q 5 | 36,010 | 1,888 | ||||||
Chemicals (1.6%) | ||||||||
Celanese Corp. 4.25% 5 | 97,000 | 1,828 | ||||||
Diversified Financial Services (2.6%) | ||||||||
Bank of America Corp. 7.25% 5 | 4,236 | 2,965 | ||||||
Insurance (3.0%) | ||||||||
MetLife, Inc. 6.38% 5 | 390,000 | 3,382 | ||||||
Oil, Gas & Consumable Fuels (0.6%) | ||||||||
Dune Energy, Inc. 12.00% -144A 5 | 1,648 | 618 | ||||||
Road & Rail (2.3%) | ||||||||
Kansas City Southern Railway 5.13% 5 | 2,450 | 2,606 | ||||||
Total Convertible Preferred Stocks (cost $16,015) | 13,287 | |||||||
Principal | ||||||||
CONVERTIBLE BONDS (68.1%) | ||||||||
Aerospace & Defense (3.8%) | ||||||||
Alliant Techsystems, Inc. | ||||||||
2.75%, due 02/15/2024 | $ | 3,910 | 4,237 | |||||
Airlines (0.8%) | ||||||||
AMR Corp. | ||||||||
4.50%, due 02/15/2024 | 945 | 891 | ||||||
Beverages (3.4%) | ||||||||
Molson Coors Brewing Co. | ||||||||
2.50%, due 07/30/2013 ^ | 4,150 | 3,787 | ||||||
Biotechnology (4.3%) | ||||||||
Gilead Sciences, Inc. | ||||||||
0.63%, due 05/01/2013 ^ | 3,855 | 4,785 | ||||||
Capital Markets (6.2%) | ||||||||
BlackRock, Inc. | ||||||||
2.63%, due 02/15/2035 | 2,225 | 2,940 | ||||||
Merrill Lynch & Co., Inc. | ||||||||
Zero Coupon, due 03/13/2032 | 3,950 | 4,034 | ||||||
Commercial Services & Supplies (3.1%) | ||||||||
Covanta Holding Corp. | ||||||||
1.00%, due 02/01/2027 | 4,225 | 3,491 | ||||||
Electronic Equipment & Instruments (1.8%) | ||||||||
Itron, Inc. | ||||||||
2.50%, due 08/01/2026 ^ | 2,452 | 2,023 | ||||||
Energy Equipment & Services (6.8%) | ||||||||
Core Laboratories, LP | ||||||||
0.25%, due 10/31/2011 | 2,830 | 2,480 | ||||||
Schlumberger, Ltd. | ||||||||
2.13%, due 06/01/2023 | 1,452 | 1,913 | ||||||
Transocean, Inc. | ||||||||
1.63%, due 12/15/2037 | 3,750 | 3,300 | ||||||
Food & Staples Retailing (3.0%) | ||||||||
Costco Wholesale Corp. | ||||||||
Zero Coupon, due 08/19/2017 | 2,587 | 3,350 | ||||||
Health Care Equipment & Supplies (2.6%) | ||||||||
NuVasive, Inc. | ||||||||
2.25%, due 03/15/2013 -144A | 2,493 | 2,932 | ||||||
IT Services (2.2%) | ||||||||
Alliance Data Systems Corp. | ||||||||
1.75%, due 08/01/2013 -144A | 3,320 | 2,465 | ||||||
Leisure Equipment & Products (3.0%) | ||||||||
Hasbro, Inc. | ||||||||
2.75%, due 12/01/2021 | 2,450 | 3,369 | ||||||
Life Sciences Tools & Services (1.5%) | ||||||||
Fisher Scientific International, Inc. | ||||||||
3.25%, due 03/01/2024 ^ | 1,529 | 1,745 | ||||||
Media (2.3%) | ||||||||
Macrovision Corp. | ||||||||
2.63%, due 08/15/2011 | 3,875 | 2,596 | ||||||
Oil, Gas & Consumable Fuels (1.8%) | ||||||||
Chesapeake Energy Corp. | ||||||||
2.50%, due 05/15/2037 ^ | 3,330 | 2,085 | ||||||
Pharmaceuticals (5.5%) | ||||||||
Allergan, Inc. | ||||||||
1.50%, due 04/01/2026 ^ | 3,250 | 2,929 | ||||||
Sepracor, Inc. | ||||||||
Zero Coupon, due 10/15/2024 ^ | 3,700 | 3,293 | ||||||
Road & Rail (2.9%) | ||||||||
CSX Corp. | ||||||||
Zero Coupon, due 10/30/2021 | 2,000 | 3,243 | ||||||
Software (5.4%) | ||||||||
Informatica Corp. | ||||||||
3.00%, due 03/15/2026 | 4,105 | 3,556 | ||||||
Nuance Communications, Inc. | ||||||||
2.75%, due 08/15/2027 | 3,100 | 2,484 | ||||||
Specialty Retail (3.5%) | ||||||||
Penske Auto Group, Inc. | ||||||||
3.50%, due 04/01/2026 | 3,830 | 2,571 | ||||||
TJX Companies, Inc. | ||||||||
Zero Coupon, due 02/13/2021 | 1,500 | 1,318 | ||||||
Wireless Telecommunication Services (4.2%) | ||||||||
NII Holdings, Inc. | ||||||||
2.75%, due 08/15/2025 | 823 | 665 | ||||||
3.13%, due 06/15/2012 -144A | 2,304 | 1,267 | ||||||
SBA Communications Corp. | ||||||||
1.88%, due 05/01/2013 -144A | 4,270 | 2,786 | ||||||
Total Convertible Bonds (cost $93,383) | 76,535 | |||||||
The notes to the financial statements are an integral part of this report.
10
Principal | Value | |||||||
REVERSE CONVERTIBLE BONDS¥ (7.9%) | ||||||||
Capital Markets (7.9%) | ||||||||
Deutsche Bank AG | ||||||||
27.01%, due 01/02/2009 -144A § | $ | 88 | $ | 5,222 | ||||
Goldman Sachs Group, Inc. | ||||||||
17.65%, due 12/05/2008 -144A § | 34 | 3,592 | ||||||
Total Reverse Convertible Bonds (cost $12,494) | 8,814 | |||||||
REPURCHASE AGREEMENT (6.2%) | ||||||||
State Street Repurchase Agreement 0.15%, dated 10/31/2008, to be repurchased at $6,992 on 11/03/2008 à • | 6,992 | 6,992 | ||||||
Total Repurchase Agreement (cost $6,992) | 6,992 | |||||||
Shares | ||||||||
SECURITIES LENDING COLLATERAL (13.8%) | ||||||||
State Street Navigator Securities Lending Trust — Prime Portfolio, 2.71% à 5 | 15,504,358 | 15,504 | ||||||
Total Securities Lending Collateral (cost $15,504) | 15,504 | |||||||
Total Investment Securities (cost $147,921) # | $ | 124,706 | ||||||
NOTES TO SCHEDULE OF INVESTMENTS: | ||
* | Floating or variable rate note. Rate is listed as of 10/31/2008. | |
^ | All or a portion of this security is on loan. The value of all securities on loan is $15,182. | |
• | Repurchase agreement is collateralized by a U.S. Government Agency Obligation with an interest rate of 4.00%, and a maturity date of 06/01/2014, and with a market value plus accrued interest of $7,133. | |
§ | Illiquid. At 10/31/2008, these securities aggregated $8,814, or 7.84% of the Fund’s net assets. | |
à | State Street Bank & Trust Company serves as the accounting, custody, and lending agent for the Fund and provides various services on behalf of the Fund. | |
5 | Interest rate shown reflects the yield at 10/31/2008. | |
q | Synthetic convertibles are a debt and warrant package structured to resemble a traditional convertible debt issue. The components of the package may be separable, unlike traditional convertibles, or they may be in the form of an equity-linked note. | |
# | Aggregate cost for federal income tax purposes is $147,956. Aggregate gross unrealized appreciation/depreciation for all securities in which there is an excess of value over tax cost were $753 and $24,003, respectively. Net unrealized depreciation for tax purposes is $23,250. | |
¥ | A bond that can be converted to cash, debt, or equity at the discretion of the issuer at a set date. The bond contains an embedded derivative that allows the issuer to put the bond to bondholders at a set date prior to the bond’s maturity for existing debt or shares of an underlying company. The underlying company need not be related in any way to the issuer’s business. |
DEFINTIONS:
144A | 144A Securities are registered pursuant to Rule 144A of the Securities Act of 1933. These securities are deemed to be liquid for purposes of compliance limitations on holdings of illiquid securities and may be resold as transactions exempt from registration, normally to qualified institutional buyers. At 10/31/2008, these securities aggregated $18,882, or 16.80% of the Fund’s net assets. | |
LLC | Limited Liability Company | |
LP | Limited Partnership |
The notes to the financial statements are an integral part of this report.
11
Transamerica Equity
(unaudited)
(unaudited)
MARKET ENVIRONMENT
Faced with many challenges in the twelve months ended October 31, 2008, US equity indices delivered double-digit negative returns across the board. The Russell 1000® Growth Index (“Russell 1000 Growth”) declined 36.95%.
Throughout the period, problems plaguing the housing market continued, while commodity prices first soared then plummeted. Meanwhile, what began as concerns about securities related to defaulting sub-prime mortgages escalated into a variety of increasingly severe crises in the markets where banks lend to each other and to businesses, causing extreme disruption in both US and foreign financial markets. As the problems multiplied, financial institutions tightened their lending standards. This made it more difficult for companies to fund payroll, inventory and other near-term expenses in the face of high borrowing costs. Consumers, who already were feeling the effects of high energy prices, increasing food costs, rising unemployment and lack of wage growth, also found it more difficult to borrow. Although the Federal Reserve Board (“Fed”) and the US government intervened to restore confidence in the financial systems, the US headed toward recession and expectations of a global economic slowdown rose.
PERFORMANCE
For the year ended October 31, 2008, Transamerica Equity Class A returned (43.25)%. By comparison, its benchmark, the Russell 1000 Growth, returned (36.95)%.
STRATEGY REVIEW
The Fund lagged the index due primarily to poor results from our holdings within the automotive/transportation (e.g., Daimler AG (“Daimler”)), technology (e.g., Research in Motion Limited (“RIMM”)), and consumer discretionary (e.g., MGM Mirage (“MGM”)) sectors. Daimler suffered during the year as a result of the downward trend in automotive sales worldwide, a trend that was heightened by consumers’ difficulty in obtaining automotive loans. We believe RIMM’s performance can be attributed to the concerns of slowing consumer spending rather than to any deterioration in company fundamentals. We sold our position in MGM in early 2008, based on our belief that discretionary spending on travel and entertainment would slow.
Partially offsetting these declines were our selections in materials/processing (e.g., Praxair, Inc. (“Praxair”)) and healthcare (e.g., Gilead Sciences, Inc. (“Gilead”)) and our cash position. Praxair, a producer and distributor of industrial gases, held up relatively well because its stable business model emphasizes long-term contracts. We believe this will help the company maintain its already strong market share. Gilead, a biopharmaceutical company working on treatments for cures to life-threatening diseases, has benefited from competitors’ mergers, which reduced its competition. Our goal is to be fully invested at all times, and cash has historically averaged less than 5% of portfolio assets. However, as market conditions worsened, we let our cash position build slightly so that we could redeploy the assets in attractive new opportunities as they arose.
We believe a consumer-driven recession has already arrived. We believe the federal government’s $700-billion rescue of the financial services sector, the biggest government intervention in the financial system since the 1930s, should provide some much-needed rationality in the markets. We believe it should help to rebuild trust among financial institutions and serve to shorten or at least reduce the severity of the recession. In the interim, high levels of market volatility likely will persist. The portfolio is populated with stocks of companies that, in our opinion, have capable management teams, strong balance sheets and highly competitive positions, and we believe stand to benefit from long-term secular trends.
Gary U. Rollé, CFA
Geoffrey I. Edelstein, CFA, CIC
Edward S. Han
John J. Huber, CFA
Peter O. Lopez
Eric U. Rollé
Geoffrey I. Edelstein, CFA, CIC
Edward S. Han
John J. Huber, CFA
Peter O. Lopez
Eric U. Rollé
Co-Portfolio Managers
Transamerica Investment Management, LLC
Transamerica Investment Management, LLC
12
![(LINE GRAPH)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025721.gif)
Average Annual Total Return for Periods Ended 10/31/2008
From | ||||||||||||||||
1 Year | 5 Years | Inception | Inception Date | |||||||||||||
Class A (NAV) | (43.25 | )% | 0.46 | % | (4.00 | )% | 3/1/00 | |||||||||
Class A (POP) | (46.36 | )% | (0.68 | )% | (4.62 | )% | 3/1/00 | |||||||||
Russell 1000 Growth (1) | (36.95 | )% | (1.29 | )% | (7.31 | )% | 3/1/00 | |||||||||
Class B (NAV) | (43.63 | )% | (0.29 | )% | (4.66 | )% | 3/1/00 | |||||||||
Class B (POP) | (46.45 | )% | (0.49 | )% | (4.66 | )% | 3/1/00 | |||||||||
Class C (NAV) | (43.61 | )% | (0.23 | )% | 3.75 | % | 11/11/02 | |||||||||
Class C (POP) | (44.17 | )% | (0.23 | )% | 3.75 | % | 11/11/02 | |||||||||
Class I (NAV) | (42.85 | )% | N/A | (8.51 | )% | 11/15/05 | ||||||||||
Class T (NAV) | (42.92 | )% | N/A | (15.86 | )% | 10/27/06 | ||||||||||
Class T (POP) | (47.76 | )% | N/A | (19.49 | )% | 10/27/06 |
NOTES | ||
(1) | The Russell 1000 Growth Index is an unmanaged index used as a general measure of market performance. Calculations assume dividends and capital gains are reinvested and do not include any managerial expenses. You cannot invest directly in an index. |
The performance data presented represents past performance; future results may vary. Performance data does not reflect the deduction of taxes that would be paid on fund distributions or the redemption of fund shares. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than performance quoted. Please see www.transamericafunds.com for performance data current to the most recent month-end. Public Offering Price (POP) returns include the reinvestment of dividends and capital gains and reflect the maximum sales charge of 5.5% for A shares (8.5% for Class T) or the maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 6 years) for Class B shares and 1% (during the first 12 months) for Class C shares. Shares purchased prior to March 1, 2004 are subject to a maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 7 years) for Class B shares and (2% in the 1st year, decreasing to 0% after 2 years) for Class C shares. Net Asset Value (NAV) returns include the reinvestment of dividends and capital gains but do not reflect any sales charges.
This material must be preceded or accompanied by a current prospectus, which includes specific contents regarding the investment objectives and policies of this Fund. Class T is closed to new investments.
13
UNDERSTANDING YOUR FUND’S EXPENSES
(unaudited)
(unaudited)
SHAREHOLDER EXPENSES
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, contingent deferred sales charges on redemptions and redemption fees; and (2) ongoing costs, including management fees, 12b-1 distribution and service fees, and other fund expenses.
The following Example is intended to help you understand your ongoing costs (in dollars and cents) of investing in the Fund and to compare these costs with the ongoing costs of investing in other funds.
The Example is based on an investment of $1,000 invested at May 1, 2008 and held for the entire period until October 31, 2008.
ACTUAL EXPENSES
The first line in the table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line of your Fund under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. If your account is an IRA, your expenses could have included a $15 annual fee. The amount of any fee paid through your account would increase the estimate of expenses you paid during the period and decrease your ending account value.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line in the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. As in the case of the actual expense example, if your account is subject to an IRA fee, the amount of the fee paid through your account would increase the hypothetical expenses you would have paid during the period and decrease the hypothetical ending account value.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges, redemption fees, brokerage commissions paid on purchases and sales of fund shares. Therefore, the second line under the Fund in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. If any of these transaction costs were included, your costs would be higher. The expenses shown in the table do not reflect any fees that may be charged to you by brokers, financial intermediaries or other financial institutions.
Beginning | Ending | Annualize | Expenses | |||||||||||||
Account | Account | Expense | Paid During | |||||||||||||
Value | Value | Ratio | Period (a) | |||||||||||||
Class A | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 643.19 | 1.40 | % | $ | 5.78 | ||||||||
Hypothetical (b) | 1,000.00 | 1,018.10 | 1.40 | 7.10 | ||||||||||||
Class B | ||||||||||||||||
Actual | 1,000.00 | 641.36 | 2.17 | 8.95 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,014.23 | 2.17 | 10.99 | ||||||||||||
Class C | ||||||||||||||||
Actual | 1,000.00 | 641.44 | 2.03 | 8.38 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,014.93 | 2.03 | 10.28 | ||||||||||||
Class I | ||||||||||||||||
Actual | 1,000.00 | 646.02 | 0.74 | 3.06 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,021.42 | 0.74 | 3.76 | ||||||||||||
Class T | ||||||||||||||||
Actual | 1,000.00 | 645.31 | 0.88 | 3.64 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,020.71 | 0.88 | 4.47 |
(a) | Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days), and divided by the number of days in the year (366 days). | |
(b) | 5% return per year before expenses. |
GRAPHICAL PRESENTATION OF SCHEDULE OF INVESTMENTS
By Sector
At October 31, 2008
(unaudited)
By Sector
At October 31, 2008
(unaudited)
![(PIE CHART)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025722.gif)
This chart shows the percentage breakdown by Sector of the Fund’s total investment securities. Percentage breakdown of the Short-term category includes Securities Lending Collateral.
14
SCHEDULE OF INVESTMENTS
At October 31, 2008
(all amounts except share amounts in thousands)
At October 31, 2008
(all amounts except share amounts in thousands)
Shares | Value | |||||||
COMMON STOCKS (92.7%) | ||||||||
Aerospace & Defense (6.2%) | ||||||||
Boeing Co. | 327,000 | $ | 17,092 | |||||
Raytheon Co. | 875,000 | 44,721 | ||||||
Air Freight & Logistics (2.9%) | ||||||||
Expeditors International of Washington, Inc. | 875,000 | 28,569 | ||||||
Auto Components (4.5%) | ||||||||
BorgWarner, Inc. | 793,400 | 17,828 | ||||||
Johnson Controls, Inc. ^ | 1,515,200 | 26,865 | ||||||
Automobiles (1.9%) | ||||||||
Daimler AG ^ | 550,000 | 18,975 | ||||||
Biotechnology (5.1%) | ||||||||
Gilead Sciences, Inc. ‡ ^ | 1,100,000 | 50,435 | ||||||
Capital Markets (3.0%) | ||||||||
T. Rowe Price Group, Inc. ^ | 765,832 | 30,281 | ||||||
Chemicals (12.0%) | ||||||||
Ecolab, Inc. | 670,000 | 24,964 | ||||||
Praxair, Inc. | 940,000 | 61,241 | ||||||
Sigma-Aldrich Corp. ^ | 770,000 | 33,772 | ||||||
Commercial Banks (3.2%) | ||||||||
Wells Fargo & Co. ^ | 925,000 | 31,496 | ||||||
Communications Equipment (5.1%) | ||||||||
Qualcomm, Inc. | 1,100,000 | 42,086 | ||||||
Research In Motion, Ltd. ‡ | 185,000 | 9,330 | ||||||
Computers & Peripherals (4.5%) | ||||||||
Apple, Inc. ‡ | 422,000 | 45,403 | ||||||
Construction & Engineering (3.3%) | ||||||||
Jacobs Engineering Group, Inc. ‡ | 900,000 | 32,787 | ||||||
Consumer Finance (1.5%) | ||||||||
American Express Co. ^ | 560,000 | 15,400 | ||||||
Diversified Financial Services (2.3%) | ||||||||
CME Group, Inc. -Class A ^ | 81,000 | 22,854 | ||||||
Diversified Telecommunication Services (2.6%) | ||||||||
AT&T, Inc. | 980,000 | 26,235 | ||||||
Electronic Equipment & Instruments (3.5%) | ||||||||
Tyco Electronics, Ltd. | 1,780,000 | 34,603 | ||||||
Energy Equipment & Services (1.8%) | ||||||||
Schlumberger, Ltd. | 343,000 | 17,716 | ||||||
Health Care Equipment & Supplies (6.0%) | ||||||||
Becton Dickinson & Co. | 372,750 | 25,869 | ||||||
Varian Medical Systems, Inc. ‡ | 745,000 | 33,905 | ||||||
Industrial Conglomerates (3.3%) | ||||||||
General Electric Co. | 1,700,000 | 33,167 | ||||||
Internet & Catalog Retail (4.2%) | ||||||||
Amazon.com, Inc. ‡ ^ | 725,000 | 41,499 | ||||||
Internet Software & Services (3.8%) | ||||||||
Google, Inc. -Class A ‡ | 105,000 | 37,733 | ||||||
Machinery (4.6%) | ||||||||
Caterpillar, Inc. | 457,000 | 17,444 | ||||||
PACCAR, Inc. ^ | 980,000 | 28,655 | ||||||
Oil, Gas & Consumable Fuels (1.0%) | ||||||||
Petroleo Brasileiro SA ADR | 360,000 | 9,680 | ||||||
Pharmaceuticals (2.2%) | ||||||||
Allergan, Inc. | 560,000 | 22,215 | ||||||
Road & Rail (4.2%) | ||||||||
Union Pacific Corp. | 635,000 | 42,399 | ||||||
Total Common Stocks (cost $1,141,131) | 925,219 | |||||||
Principal | ||||||||
REPURCHASE AGREEMENT (13.3%) | ||||||||
State Street Repurchase Agreement 0.15%, dated 10/31/2008, to be repurchased at $132,589 on 11/03/2008 à • | $ | 132,587 | 132,587 | |||||
Total Repurchase Agreement (cost $132,587) | 132,587 | |||||||
Shares | ||||||||
SECURITIES LENDING COLLATERAL (20.9%) | ||||||||
State Street Navigator Securities Lending Trust - Prime Portfolio, 2.71% à ▲ | 208,081,714 | 208,082 | ||||||
Total Securities Lending Collateral (cost $208,082) | 208,082 | |||||||
Total Investment Securities (cost $1,481,800) # | $ | 1,265,888 | ||||||
NOTES TO SCHEDULE OF INVESTMENTS: | ||
^ | All or a portion of this security is on loan. The value of all securities on loan is $203,507. | |
‡ | Non-income producing security. | |
• | Repurchase agreement is collateralized by a U.S. Government Agency Obligation with an interest rate of 5.00%, and a maturity date of 12/01/2019, and with a market value plus accrued interest of $135,241. | |
à | State Street Bank & Trust Company serves as the accounting, custody, and lending agent for the Fund and provides various services on behalf of the Fund. | |
▲ | Interest rate shown reflects the yield at 10/31/2008. | |
# | Aggregate cost for federal income tax purposes is $1,489,991. Aggregate gross unrealized appreciation/depreciation for all securities in which there is an excess of value over tax cost were $55,657 and $279,760, respectively. Net unrealized depreciation for tax purposes is $224,103. | |
DEFINITION: | ||
ADR | American Depositary Receipt |
The notes to the financial statements are an integral part of this report.
15
Transamerica Flexible Income
(unaudited)
(unaudited)
MARKET ENVIRONMENT
In the twelve months ended October 31, 2008, conditions in the economy and credit markets deteriorated, creating a very unstable environment for bond investors. The Barclays Capital (formerly Lehman Brothers) US Government/Credit Bond Index (“BCGC”) declined 1.06%.
What began as concerns about securities related to defaulting sub-prime mortgages escalated into a variety of increasingly severe crises. Overnight lending between banks, a vital part of maintaining the flow of capital in the financial system, was disrupted as banks increasingly worried about undisclosed risks from exotic securities and the financial strength and stability of other banks. As credit problems multiplied, financial institutions focused on preserving capital and were more selective about lending, making it more difficult for businesses to fund payroll, inventory and other near-term expenses.
The risk aversion eventually spread from Wall Street to Main Street, where it added to growing problems on the economic front. Throughout the period, the housing market continued to deteriorate, while commodity prices were volatile. Rising unemployment, coupled with lack of wage growth and tighter credit conditions, caused consumers to rein in their spending. The reduction in consumer spending, which is the backbone of the US economy, exacerbated problems further.
The Federal Reserve Board (“Fed”) and the US government intervened on several occasions, taking unprecedented measures to curb the crises, improve liquidity, and stimulate the economy. Among the many initiatives were new government-guaranteed loans, larger and more varied lending facilities for banks, and the federal bailout or takeover of major financial institutions. Even with the government’s intervention, the expectations of a global economic slowdown and US recession rose. Nearing the end of the period, investors flocked to the relative safety of US government debt, and Treasury yields declined rapidly. Finally, as concerns about how a slowing economy would affect mortgages and corporate profits, yields on other securities rose, and prices for most non-government securities fell.
PERFORMANCE
For the year ended October 31, 2008, Transamerica Flexible Income Class A returned (16.57)%. By comparison, its benchmark, the BCGC, returned (1.06)%.
STRATEGY REVIEW
Throughout the period, the portfolio generated competitive yields, aided by an overweighting in corporate bonds, an area where yields generally rose. However, as the market tumult came to a head and yield spreads between government and corporate bonds grew, this overweighting hindered performance. Although the overweighting in corporate bonds had a negative impact to performance, our selections within the group helped mitigate losses. We stayed away from the most distressed companies (i.e., Lehman Brothers Holdings Inc. (“Lehman Brothers”), American International Group, Inc. (“AIG”) and Washington Mutual, Inc.) and had no exposure to sub-prime mortgage securities.
Portfolio management responsibilities were transferred to a new team at Transamerica Investment Management, LLC as of October 1, 2008. The new team began repositioning the portfolio while maintaining the portfolio’s mandate of income generation. Our focus became less on corporate issues and more on a diversified pool of fixed-income generating assets, including agency mortgage backed securities (“MBS”). Agency MBS were less volatile than other fixed-income securities because the government, in bailing out the securities’ issuers, had strengthened its guarantee of these securities.
We believe a consumer-driven recession has already arrived. We believe the federal government’s $700-billion rescue of the financial services sector should provide some much-needed rationality in the markets. We believe it should help to rebuild trust among financial institutions and reduce the severity of the recession. In the interim, high levels of market volatility likely will persist.
Derek S. Brown, CFA
Kirk J. Kim
Greg D. Haendel, CFA
Peter O. Lopez
Brian W. Westhoff, CFA
Kirk J. Kim
Greg D. Haendel, CFA
Peter O. Lopez
Brian W. Westhoff, CFA
Co-Portfolio Managers
Transamerica Investment Management, LLC
Transamerica Investment Management, LLC
Prior to October 1, 2008, Heidi Y. Hu, CFA was also a co-portfolio manager.
16
![(LINE GRAPH)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025723.gif)
Average Annual Total Return for Periods Ended 10/31/2008
From | Inception | |||||||||||||||||||
1 Year | 5 Years | 10 Years | Inception | Date | ||||||||||||||||
Class A (NAV) | (16.57 | )% | (0.90 | )% | 2.44 | % | 5.59 | % | 6/29/87 | |||||||||||
Class A (POP) | (20.57 | )% | (1.86 | )% | 1.94 | % | 5.35 | % | 6/29/87 | |||||||||||
Barclays Capital Government/Credit Bond Index (1) | (1.06 | )% | 3.08 | % | 4.81 | % | 7.05 | % | 6/29/87 | |||||||||||
Class B (NAV) | (17.03 | )% | (1.52 | )% | 1.90 | % | 3.53 | % | 10/1/95 | |||||||||||
Class B (POP) | (20.98 | )% | (1.67 | )% | 1.90 | % | 3.53 | % | 10/1/95 | |||||||||||
Class C (NAV) | (16.98 | )% | (1.52 | )% | N/A | (0.44 | )% | 11/11/02 | ||||||||||||
Class C (POP) | (17.77 | )% | (1.52 | )% | N/A | (0.44 | )% | 11/11/02 | ||||||||||||
Class I (NAV) | (16.02 | )% | N/A | N/A | (1.95 | )% | 11/8/04 |
NOTES | ||
(1) | The Barclays Capital Government/Credit Bond Index is an unmanaged index used as a general measure of market performance. Calculations assume dividends and capital gains are reinvested and do not include any managerial expenses. You cannot invest directly in an index. |
The performance data presented represents past performance; future results may vary. Performance data does not reflect the deduction of taxes that would be paid on fund distributions or the redemption of fund shares. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than performance quoted. Please see www.transamericafunds.com for performance data current to the most recent month-end. Public Offering Price (POP) returns include the reinvestment of dividends and capital gains and reflect the maximum sales charge of 4.75% for A shares or the maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 6 years) for Class B shares and 1% (during the first 12 months) for Class C shares. Shares purchased prior to March 1, 2004 are subject to a maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 7 years) for Class B shares and (2% in the 1st year, decreasing to 0% after 2 years) for Class C shares. Net Asset Value (NAV) returns include the reinvestment of dividends and capital gains but do not reflect any sales charges.
This material must be preceded or accompanied by a current prospectus, which includes specific contents regarding the investment objectives and policies of this Fund.
17
UNDERSTANDING YOUR FUND’S EXPENSES
(unaudited)
(unaudited)
SHAREHOLDER EXPENSES
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, contingent deferred sales charges on redemptions and redemption fees; and (2) ongoing costs, including management fees, 12b-1 distribution and service fees, and other fund expenses.
The following Example is intended to help you understand your ongoing costs (in dollars and cents) of investing in the Fund and to compare these costs with the ongoing costs of investing in other funds.
The Example is based on an investment of $1,000 invested at May 1, 2008 and held for the entire period until October 31, 2008.
ACTUAL EXPENSES
The first line in the table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line of your Fund under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. If your account is an IRA, your expenses could have included a $15 annual fee. The amount of any fee paid through your account would increase the estimate of expenses you paid during the period and decrease your ending account value.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line in the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. As in the case of the actual expense example, if your account is subject to an IRA fee, the amount of the fee paid through your account would increase the hypothetical expenses you would have paid during the period and decrease the hypothetical ending account value.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges, redemption fees, brokerage commissions paid on purchases and sales of fund shares. Therefore, the second line under the Fund in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. If any of these transaction costs were included, your costs would be higher. The expenses shown in the table do not reflect any fees that may be charged to you by brokers, financial intermediaries or other financial institutions.
Beginning | Ending | Annualized | Expenses | |||||||||||||
Account | Account | Expense | Paid During | |||||||||||||
Value | Value | Ratio | Period (a) | |||||||||||||
Class A | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 851.44 | 1.40 | % | $ | 6.52 | ||||||||
Hypothetical (b) | 1,000.00 | 1,018.10 | 1.40 | 7.10 | ||||||||||||
Class B | ||||||||||||||||
Actual | 1,000.00 | 848.53 | 2.04 | 9.48 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,014.88 | 2.04 | 10.33 | ||||||||||||
Class C | ||||||||||||||||
Actual | 1,000.00 | 849.61 | 1.97 | 9.16 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,015.23 | 1.97 | 9.98 | ||||||||||||
Class I | ||||||||||||||||
Actual | 1,000.00 | 853.58 | 0.78 | 3.63 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,021.22 | 0.78 | 3.96 |
(a) | Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days), and divided by the number of days in the year (366 days). | |
(b) | 5% return per year before expenses. |
GRAPHICAL PRESENTATION OF SCHEDULE OF INVESTMENTS
By Asset Type
At October 31, 2008
(unaudited)
By Asset Type
At October 31, 2008
(unaudited)
![(PIE CHART)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025724.gif)
This chart shows the percentage breakdown by Asset Type of the Fund’s total investment securities. Percentage breakdown of the Short-term category includes Securities Lending Collateral.
18
SCHEDULE OF INVESTMENTS
At October 31, 2008
(all amounts except share amounts in thousands)
At October 31, 2008
(all amounts except share amounts in thousands)
Principal | Value | |||||||
U.S. GOVERNMENT OBLIGATIONS (8.0%) | ||||||||
U.S. Treasury Bond | ||||||||
4.38%, due 02/15/2038 ^ | $ | 2,517 | $ | 2,525 | ||||
U.S. Treasury Note | ||||||||
3.13%, due 09/30/2013 | 5,995 | 6,092 | ||||||
4.00%, due 08/15/2018 ^ | 3,800 | 3,805 | ||||||
Total U.S. Government Obligations (cost $12,492) | 12,422 | |||||||
U.S. GOVERNMENT AGENCY OBLIGATIONS (7.6%) | ||||||||
Fannie Mae | ||||||||
5.00%, due 06/25/2019 | 4,231 | 4,234 | ||||||
5.50%, due 07/01/2038 | 5,169 | 5,052 | ||||||
Freddie Mac | ||||||||
6.16%, due 12/01/2036 * | 2,575 | 2,612 | ||||||
Total U.S. Government Agency Obligations (cost $12,034) | 11,898 | |||||||
FOREIGN GOVERNMENT OBLIGATION (2.6%) | ||||||||
U.K. Gilt | ||||||||
4.50%, due 03/07/2013 GBP | 2,500 | 4,113 | ||||||
Total Foreign Government Obligation (cost $4,490) | 4,113 | |||||||
MORTGAGE-BACKED SECURITIES (5.9%) | ||||||||
American Tower Trust | ||||||||
Series 2007-1A, Class C | ||||||||
5.62%, due 04/15/2037 -144A | 2,090 | 1,726 | ||||||
Citigroup/Deutsche Bank Commercial Mortgage Trust | ||||||||
Series 2007-CD4, Class J | ||||||||
5.69%, due 12/11/2049 -144A | 4,750 | 1,253 | ||||||
Crown Castle Towers LLC | ||||||||
Series 2006-1A, Class C | ||||||||
5.47%, due 11/15/2036 -144A | 2,000 | 1,815 | ||||||
SBA CMBS Trust | ||||||||
Series 2006-1A, Class D | ||||||||
5.85%, due 11/15/2036 -144A | 2,054 | 1,778 | ||||||
Series 2006-1A, Class E | ||||||||
6.17%, due 11/15/2036 -144A | 1,460 | 1,227 | ||||||
Wachovia Bank Commercial Mortgage Trust | ||||||||
Series 2006-C28, Class H | ||||||||
5.97%, due 10/15/2048 -144A | 3,760 | 1,427 | ||||||
Total Mortgage-Backed Securities (cost $15,328) | 9,226 | |||||||
CORPORATE DEBT SECURITIES (70.6%) | ||||||||
Aerospace & Defense (1.6%) | ||||||||
Embraer Overseas, Ltd. | ||||||||
6.38%, due 01/24/2017 | 1,487 | 967 | ||||||
Honeywell International, Inc. | ||||||||
2.88%, due 03/13/2009 * | 1,520 | 1,477 | ||||||
Air Freight & Logistics (1.1%) | ||||||||
Federal Express Corp. | ||||||||
9.65%, due 06/15/2012 | 1,600 | 1,671 | ||||||
Airlines (1.2%) | ||||||||
Delta Air Lines, Inc. | ||||||||
6.82%, due 08/10/2022 | 2,805 | 1,823 | ||||||
Automobiles (2.0%) | ||||||||
Daimler Finance North America LLC | ||||||||
3.17%, due 03/13/2009 * | 500 | 470 | ||||||
8.00%, due 06/15/2010 ^ | 3,000 | 2,651 | ||||||
Beverages (4.2%) | ||||||||
Brown-Forman Corp. | ||||||||
5.20%, due 04/01/2012 | 3,600 | 3,462 | ||||||
Sabmiller PLC | ||||||||
6.20%, due 07/01/2011 -144A | 3,065 | 3,112 | ||||||
Building Products (1.6%) | ||||||||
CRH America, Inc. | ||||||||
5.30%, due 10/15/2013 | 3,140 | 2,525 | ||||||
Capital Markets (1.9%) | ||||||||
Lazard Group | ||||||||
7.13%, due 05/15/2015 | 3,750 | 2,950 | ||||||
Chemicals (1.8%) | ||||||||
Lubrizol Corp. | ||||||||
4.63%, due 10/01/2009 ^ | 2,000 | 1,927 | ||||||
Nalco Co. | ||||||||
7.75%, due 11/15/2011 | 1,000 | 910 | ||||||
Commercial Banks (2.4%) | ||||||||
Barclays Bank PLC | ||||||||
7.70%, due 04/25/2018 -144A ■ ^ Ž | 2,850 | 1,978 | ||||||
M&I Marshall & Ilsley Bank | ||||||||
3.08%, due 12/04/2012 * | 2,000 | 1,561 | ||||||
Shinsei Finance Cayman, Ltd. | ||||||||
6.42%, due 07/20/2016 -144A ■ Ž | 950 | 214 | ||||||
Construction Materials (1.2%) | ||||||||
Lafarge SA | ||||||||
7.13%, due 07/15/2036 | 2,600 | 1,864 | ||||||
Consumer Finance (1.2%) | ||||||||
Cardtronics, Inc. | ||||||||
9.25%, due 08/15/2013 * | 835 | 655 | ||||||
HSBC Finance Capital Trust IX | ||||||||
5.91%, due 11/30/2035 | 2,250 | 1,229 | ||||||
Containers & Packaging (2.2%) | ||||||||
Rexam PLC | ||||||||
6.75%, due 06/01/2013 -144A | 3,565 | 3,494 | ||||||
Diversified Financial Services (5.3%) | ||||||||
Galaxy Entertainment Finance Co., Ltd. | ||||||||
9.88%, due 12/15/2012 -144A | 1,400 | 532 | ||||||
Glencore Funding LLC | ||||||||
6.00%, due 04/15/2014 -144A | 3,950 | 3,734 | ||||||
Pemex Finance, Ltd. | ||||||||
9.03%, due 02/15/2011 | 3,175 | 3,199 | ||||||
Sensus Metering Systems, Inc. | ||||||||
8.63%, due 12/15/2013 | 1,000 | 820 | ||||||
Diversified Telecommunication Services (1.0%) | ||||||||
Verizon Communications, Inc. | ||||||||
8.75%, due 11/01/2018 | 1,500 | 1,532 | ||||||
Electric Utilities (5.9%) | ||||||||
DPL, Inc. | ||||||||
8.00%, due 03/31/2009 | 5,000 | 5,024 | ||||||
Sempra Energy | ||||||||
7.95%, due 03/01/2010 | 4,260 | 4,283 | ||||||
Food & Staples Retailing (3.0%) | ||||||||
Safeway, Inc. | ||||||||
4.95%, due 08/16/2010 ^ | 3,055 | 3,014 | ||||||
Stater Brothers Holdings, Inc. | ||||||||
8.13%, due 06/15/2012 ^ | 2,000 | 1,780 | ||||||
Food Products (1.6%) | ||||||||
ConAgra Foods, Inc. | ||||||||
9.75%, due 03/01/2021 | 325 | 335 | ||||||
Michael Foods, Inc. | ||||||||
8.00%, due 11/15/2013 | 2,575 | 2,227 |
The notes to the financial statements are an integral part of this report.
19
Principal | Value | |||||||
Gas Utilities (0.2%) | ||||||||
Intergas Finance BV | ||||||||
6.38%, due 05/14/2017 -144A | $ | 740 | $ | 348 | ||||
Hotels, Restaurants & Leisure (3.5%) | ||||||||
Carrols Corp. | ||||||||
9.00%, due 01/15/2013 ^ | 500 | 322 | ||||||
MGM Mirage, Inc. | ||||||||
8.50%, due 09/15/2010 | 2,000 | 1,385 | ||||||
Station Casinos, Inc. | ||||||||
6.88%, due 03/01/2016 ^ | 700 | 63 | ||||||
Yum! Brands, Inc. | ||||||||
8.88%, due 04/15/2011 | 3,575 | 3,665 | ||||||
Independent Power Producers & Energy Traders (3.5%) | ||||||||
AES Gener SA | ||||||||
7.50%, due 03/25/2014 ^ | 2,000 | 1,842 | ||||||
Empresa Nacional de Electricidad SA -Class B | ||||||||
8.50%, due 04/01/2009 | 3,600 | 3,632 | ||||||
Industrial Conglomerates (1.9%) | ||||||||
Hutchison Whampoa International, Ltd. | ||||||||
5.45%, due 11/24/2010 -144A | 1,800 | 1,698 | ||||||
Susser Holdings LLC | ||||||||
10.63%, due 12/15/2013 | 1,412 | 1,200 | ||||||
Insurance (1.7%) | ||||||||
Oil Insurance, Ltd. | ||||||||
7.56%, due 06/30/2011 -144A ■ Ž | 2,245 | 1,136 | ||||||
Reinsurance Group of America, Inc. | ||||||||
6.75%, due 12/15/2065 ■ | 2,730 | 1,573 | ||||||
IT Services (0.7%) | ||||||||
ACE Cash Express, Inc. | ||||||||
10.25%, due 10/01/2014 -144A | 345 | 162 | ||||||
Aramark Corp. | ||||||||
8.50%, due 02/01/2015 ^ | 1,000 | 855 | ||||||
Machinery (2.0%) | ||||||||
Cummins, Inc. | ||||||||
5.65%, due 03/01/2098 | 1,000 | 697 | ||||||
Polypore, Inc. | ||||||||
8.75%, due 05/15/2012 | 1,550 | 1,240 | ||||||
Titan International, Inc. | ||||||||
8.00%, due 01/15/2012 | 1,200 | 1,068 | ||||||
Media (2.2%) | ||||||||
Comcast Cable Holdings LLC | ||||||||
9.80%, due 02/01/2012 | 2,000 | 2,023 | ||||||
Grupo Televisa SA | ||||||||
6.63%, due 03/18/2025 | 2,000 | 1,370 | ||||||
Multiline Retail (0.4%) | ||||||||
Neiman-Marcus Group, Inc. | ||||||||
9.00%, due 10/15/2015 ^ | 1,000 | 685 | ||||||
Oil, Gas & Consumable Fuels (7.6%) | ||||||||
Burlington Resources, Inc. | ||||||||
9.88%, due 06/15/2010 | 1,435 | 1,522 | ||||||
Enterprise Products Operating, LP | ||||||||
8.38%, due 08/01/2066 ■ | 2,150 | 1,596 | ||||||
Gazprom International SA | ||||||||
7.20%, due 02/01/2020 -144A | 2,496 | 1,747 | ||||||
Markwest Energy Finance Corp. | ||||||||
8.50%, due 07/15/2016 ^ | 700 | 515 | ||||||
Opti Canada, Inc. | ||||||||
8.25%, due 12/15/2014 ^ | 1,800 | 1,071 | ||||||
PetroHawk Energy Corp. | ||||||||
9.13%, due 07/15/2013 | 1,255 | 966 | ||||||
Petroleum Development Corp. | ||||||||
12.00%, due 02/15/2018 ^ | 1,000 | 770 | ||||||
6.88%, due 07/15/2012 | 3,690 | 3,770 | ||||||
Paper & Forest Products (1.0%) | ||||||||
Exopack Holding, Inc. | ||||||||
11.25%, due 02/01/2014 ^ | 2,000 | 1,540 | ||||||
Professional Services (0.6%) | ||||||||
FTI Consulting, Inc. | ||||||||
7.75%, due 10/01/2016 | 1,000 | 928 | ||||||
Real Estate Investment Trusts (2.2%) | ||||||||
Healthcare Realty Trust, Inc. | ||||||||
8.13%, due 05/01/2011 | 1,480 | 1,521 | ||||||
Wea Finance LLC / WCI Finance LLC | ||||||||
5.40%, due 10/01/2012 -144A | 2,100 | 1,831 | ||||||
Road & Rail (3.5%) | ||||||||
CSX Corp. | ||||||||
6.75%, due 03/15/2011 ^ | 3,875 | 3,740 | ||||||
Kansas City Southern Railway | ||||||||
7.63%, due 12/01/2013 | 2,110 | 1,651 | ||||||
Specialty Retail (0.2%) | ||||||||
Penske Auto Group, Inc. | ||||||||
7.75%, due 12/15/2016 ^ | 750 | 358 | ||||||
Tobacco (0.2%) | ||||||||
Alliance One International, Inc. | ||||||||
11.00%, due 05/15/2012 | 425 | 359 | ||||||
Total Corporate Debt Securities (cost $132,365) | 110,269 | |||||||
Shares | ||||||||
PREFERRED STOCKS (1.4%) | ||||||||
Diversified Telecommunication Services (0.9%) | ||||||||
Centaur Funding Corp. 9.08% -144A ▲ | 1,661 | 1,399 | ||||||
Insurance (0.5%) | ||||||||
XL Capital, Ltd. 6.10% * ▲ | 113,800 | 712 | ||||||
Total Preferred Stocks (cost $4,941) | 2,111 | |||||||
Principal | ||||||||
CONVERTIBLE BOND (1.3%) | ||||||||
Capital Markets (1.3%) | ||||||||
Merrill Lynch & Co., Inc. | ||||||||
Zero Coupon, due 03/13/2032 | $ | 2,000 | 2,043 | |||||
Total Convertible Bond (cost $2,010) | 2,043 | |||||||
REPURCHASE AGREEMENT (0.7%) | ||||||||
State Street Repurchase Agreement 0.15%, dated 10/31/2008, to be repurchased at $1,065 on 11/03/2008 à • | 1,065 | 1,065 | ||||||
Total Repurchase Agreement (cost $1,065) | 1,065 | |||||||
Shares | ||||||||
SECURITIES LENDING COLLATERAL (10.5%) | ||||||||
State Street Navigator Securities Lending Trust - Prime Portfolio, 2.71% à ▲ | 16,417,280 | 16,417 | ||||||
Total Securities Lending Collateral (cost $16,417) | 16,417 | |||||||
Total Investment Securities (cost $201,142) # | $ | 169,564 | ||||||
The notes to the financial statements are an integral part of this report.
20
FORWARD FOREIGN CURRENCY CONTRACTS: ■
Settlement | Amount in U.S. | Net Unrealized | ||||||||||||||
Currency | (Sold) | Date | Dollars (Sold) | Appreciation | ||||||||||||
United Kingdom Pound | (2,587 | ) | 01/30/2009 | (4,192 | ) | 48 |
NOTES TO SCHEDULE OF INVESTMENTS: | ||
^ | All or a portion of this security is on loan. The value of all securities on loan is $16,077. | |
* | Floating or variable rate note. Rate is listed as of 10/31/2008. | |
Ž | The security has a perpetual maturity. The date shown is the next call date. | |
■ | Coupon rate is fixed for a predetermined period of time and then converts to a floating rate until maturity/call date. Rate is listed as of 10/31/2008. | |
• | Repurchase agreement is collateralized by a U.S. Government Agency Obligation with an interest rate of 5.89%, and a maturity date of 01/01/2037, and with a market value plus accrued interest of $1,088. | |
à | State Street Bank & Trust Company serves as the accounting, custody, and lending agent for the Fund and provides various services on behalf of the Fund. | |
▲ | Interest rate shown reflects the yield at 10/31/2008. | |
# | Aggregate cost for federal income tax purposes is $201,192. Aggregate gross unrealized appreciation/depreciation for all securities in which there is an excess of value over tax cost were $21 and $31,649, respectively. Net unrealized depreciation for tax purposes is $31,628. | |
DEFINITIONS: | ||
144A | 144A Securities are registered pursuant to Rule 144A of the Securities Act of 1933. These securities are deemed to be liquid for purposes of compliance limitations on holdings of illiquid securities and may be resold as transactions exempt from registration, normally to qualified institutional buyers. At 10/31/2008, these securities aggregated $30,611, or 19.61% of the Fund’s net assets. | |
LLC | Limited Liability Company | |
LP | Limited Partnership | |
PLC | Public Limited Company | |
GBP | British Pound Sterling |
The notes to the financial statements are an integral part of this report.
21
Transamerica Growth Opportunities
(unaudited)
(unaudited)
MARKET ENVIRONMENT
Faced with many challenges in the twelve months ended October 31, 2008, US equity indices delivered double-digit negative returns across the board. The Russell Midcap® Growth Index (“Russell Midcap Growth”) declined 42.65%.
Throughout the period, problems plaguing the housing market continued, while commodity prices first soared then plummeted. Meanwhile, what began as concerns about securities related to defaulting sub-prime mortgages escalated into a variety of increasingly severe crises in the markets where banks lend to each other and to businesses, causing extreme disruption in both US and foreign financial markets. As the problems multiplied, financial institutions tightened their lending standards. This made it more difficult for companies to fund payroll, inventory and other near-term expenses in the face of high borrowing costs. Consumers, already feeling the effects of higher energy and food prices, rising unemployment and lack of wage growth, also found it more difficult to borrow. Although the Federal Reserve Board (“Fed”) and the U.S. government intervened to restore confidence in the financial systems, the US headed toward recession and expectations of a global economic slowdown rose.
PERFORMANCE
For the year ended October 31, 2008, Transamerica Growth Opportunities Class A returned (42.37)%. By comparison, its benchmark, the Russell Midcap Growth, returned (42.65)%.
STRATEGY REVIEW
We attribute the outperformance primarily to stock selections in the producer durables (e.g., W.W. Grainger, Inc. (“Grainger”)), automotive/transportation (e.g., C.H. Robinson Worldwide, Inc. (“C.H. Robinson”)) and consumer discretionary (e.g., Strayer Education, Inc. (“Strayer”)) sectors. Grainger, a building maintenance supply company, has implemented improvement projects within its businesses. This company-specific catalyst enabled Grainger to take market share from smaller competitors that lacked financing opportunities. C.H. Robinson, a freight-logistics company, has been investing in the latest shipping technologies and is taking market share from under-financed competitors. Strayer, a leader in undergraduate and graduate degree programs for working adults, continued to achieve consistent growth, aided in part by the fact that, during periods of economic weakness and when jobs are scarcer, people tend to focus on improving their skills.
Because cash outperformed stocks, a modest cash position at certain times also was a net contributor to performance. Our goal is to be fully invested at all times. However, as certain of our long-term investment themes matured amidst the market volatility, we sold holdings and allowed cash to build modestly, biding our time briefly before buying into new opportunities that became available at more attractive prices as the market fell.
The largest detractors from relative performance were holdings in the healthcare (e.g., ArthroCare Corporation (“ArthroCare”)), technology (e.g., SiRF Technology Holdings, Inc. (“SiRF”)) and consumer staples (e.g., Whole Foods Market, Inc. (“Whole Foods”)) sectors. ArthroCare, which develops medical devices for use in soft-tissue surgery, restated company financials. SiRF, a maker of global positioning systems (“GPS”) semiconductor chips, lost ground as it became apparent that the commoditization of GPS chips was occurring more rapidly than we anticipated. Results for Whole Foods, the organic food grocer, weakened as a slowdown in consumer spending spread to luxury items. We sold all three stocks.
We believe a consumer-driven recession has already arrived. We believe the federal government’s $700-billion rescue of the financial services sector should provide some much-needed rationality in the markets. We believe it should help to rebuild trust among financial institutions and reduce the severity of the recession. In the interim, high levels of market volatility likely will persist.
Edward S. Han
John J. Huber, CFA
John J. Huber, CFA
Co-Portfolio Managers
Transamerica Investment Management, LLC
Transamerica Investment Management, LLC
22
![(LINE GRAPH)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025725.gif)
Average Annual Total Return for Periods Ended 10/31/2008
From | Inception | |||||||||||||||
1 Year | 5 Years | Inception | Date | |||||||||||||
Class A (NAV) | (42.37 | )% | 2.00 | % | (4.73 | )% | 3/1/00 | |||||||||
Class A (POP) | (45.52 | )% | 0.84 | % | (5.35 | )% | 3/1/00 | |||||||||
Russell Midcap Growth (1) | (42.65 | )% | (0.18 | )% | (6.16 | )% | 3/1/00 | |||||||||
Class B (NAV) | (42.82 | )% | 1.15 | % | (5.42 | )% | 3/1/00 | |||||||||
Class B (POP) | (45.68 | )% | 0.96 | % | 5.42 | )% | 3/1/00 | |||||||||
Class C (NAV) | (42.64 | )% | 1.25 | % | 4.93 | % | 11/11/02 | |||||||||
Class C (POP) | (43.22 | )% | 1.25 | % | 4.93 | % | 11/11/02 | |||||||||
Class I (NAV) | (41.85 | )% | N/A | (5.58 | )% | 11/15/05 |
NOTES | ||
(1) | The Russell Midcap Growth Index is an unmanaged index used as a general measure of market performance. Calculations assume dividends and capital gains are reinvested and do not include any managerial expenses. You cannot invest directly in an index. |
The performance data presented represents past performance; future results may vary. Performance data does not reflect the deduction of taxes that would be paid on fund distributions or the redemption of fund shares. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than performance quoted. Please see www.transamericafunds.com for performance data current to the most recent month-end. Public Offering Price (POP) returns include the reinvestment of dividends and capital gains and reflect the maximum sales charge of 5.5% for A shares or the maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 6 years) for Class B shares and 1% (during the first 12 months) for Class C shares. Shares purchased prior to March 1, 2004 are subject to a maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 7 years) for Class B shares and (2% in the 1st year, decreasing to 0% after 2 years) for Class C shares. Net Asset Value (NAV) returns include the reinvestment of dividends and capital gains but do not reflect any sales charges.
This material must be preceded or accompanied by a current prospectus, which includes specific contents regarding the investment objectives and policies of this Fund.
23
UNDERSTANDING YOUR FUND’S EXPENSES
(unaudited)
(unaudited)
SHAREHOLDER EXPENSES
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, contingent deferred sales charges on redemptions and redemption fees; and (2) ongoing costs, including management fees, 12b-1 distribution and service fees, and other fund expenses.
The following Example is intended to help you understand your ongoing costs (in dollars and cents) of investing in the Fund and to compare these costs with the ongoing costs of investing in other funds.
The Example is based on an investment of $1,000 invested at May 1, 2008 and held for the entire period until October 31, 2008.
ACTUAL EXPENSES
The first line in the table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line of your Fund under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. If your account is an IRA, your expenses could have included a $15 annual fee. The amount of any fee paid through your account would increase the estimate of expenses you paid during the period and decrease your ending account value.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line in the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. As in the case of the actual expense example, if your account is subject to an IRA fee, the amount of the fee paid through your account would increase the hypothetical expenses you would have paid during the period and decrease the hypothetical ending account value.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges, redemption fees, brokerage commissions paid on purchases and sales of fund shares. Therefore, the second line under the Fund in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. If any of these transaction costs were included, your costs would be higher. The expenses shown in the table do not reflect any fees that may be charged to you by brokers, financial intermediaries or other financial institutions.
Beginning | Ending | Annualized | Expenses | |||||||||||||
Account | Account | Expense | Paid During | |||||||||||||
Value | Value | Ratio | Period (a) | |||||||||||||
Class A | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 697.45 | 1.75 | % | $ | 7.47 | ||||||||
Hypothetical (b) | 1,000.00 | 1,016.34 | 1.75 | 8.87 | ||||||||||||
Class B | ||||||||||||||||
Actual | 1,000.00 | 694.22 | 2.40 | 10.22 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,013.07 | 2.40 | 12.14 | ||||||||||||
Class C | ||||||||||||||||
Actual | 1,000.00 | 696.04 | 2.33 | 9.93 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,013.42 | 2.33 | 11.79 | ||||||||||||
Class I | ||||||||||||||||
Actual | 1,000.00 | 700.62 | 0.84 | 3.59 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,020.91 | 0.84 | 4.27 |
(a) | Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days), and divided by the number of days in the year (366 days). | |
(b) | 5% return per year before expenses. |
GRAPHICAL PRESENTATION OF SCHEDULE OF INVESTMENTS
By Sector
At October 31, 2008
(unaudited)
By Sector
At October 31, 2008
(unaudited)
![(PIE CHART)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025726.gif)
This chart shows the percentage breakdown by Sector of the Fund’s total investment securities. Percentage breakdown of the Short-term category includes Securities Lending Collateral.
24
SCHEDULE OF INVESTMENTS
At October 31, 2008
(all amounts except share amounts in thousands)
At October 31, 2008
(all amounts except share amounts in thousands)
Shares | Value | |||||||
COMMON STOCKS (96.8%) | ||||||||
Aerospace & Defense (3.7%) | ||||||||
Precision Castparts Corp. | 63,800 | $ | 4,135 | |||||
Rockwell Collins, Inc. | 45,300 | 1,687 | ||||||
Air Freight & Logistics (7.5%) | ||||||||
CH Robinson Worldwide, Inc. ^ | 150,400 | 7,788 | ||||||
Expeditors International of Washington, Inc. ^ | 124,900 | 4,078 | ||||||
Auto Components (2.7%) | ||||||||
BorgWarner, Inc. | 192,300 | 4,321 | ||||||
Capital Markets (5.4%) | ||||||||
Greenhill & Co., Inc. ^ | 62,930 | 4,151 | ||||||
T. Rowe Price Group, Inc. ^ | 112,930 | 4,465 | ||||||
Commercial Banks (3.6%) | ||||||||
Cullen/Frost Bankers, Inc. ^ | 50,700 | 2,838 | ||||||
Signature Bank ‡ ^ | 86,000 | 2,802 | ||||||
Commercial Services & Supplies (0.8%) | ||||||||
Ritchie Bros. Auctioneers, Inc. ^ | 67,500 | 1,253 | ||||||
Communications Equipment (2.8%) | ||||||||
Polycom, Inc. ‡ ^ | 211,000 | 4,433 | ||||||
Construction & Engineering (2.4%) | ||||||||
Jacobs Engineering Group, Inc. ‡ | 103,400 | 3,767 | ||||||
Diversified Consumer Services (6.9%) | ||||||||
Strayer Education, Inc. ^ | 48,100 | 10,884 | ||||||
Diversified Financial Services (2.1%) | ||||||||
CME Group, Inc. -Class A ^ | 12,000 | 3,386 | ||||||
Electronic Equipment & Instruments (3.4%) | ||||||||
FLIR Systems, Inc. ‡ ^ | 41,700 | 1,339 | ||||||
Trimble Navigation, Ltd. ‡ ^ | 201,000 | 4,135 | ||||||
Energy Equipment & Services (2.3%) | ||||||||
Cameron International Corp. ‡ ^ | 148,000 | 3,590 | ||||||
Health Care Equipment & Supplies (5.8%) | ||||||||
Idexx Laboratories, Inc. ‡ | 54,800 | 1,928 | ||||||
Intuitive Surgical, Inc. ‡ ^ | 27,700 | 4,786 | ||||||
Varian Medical Systems, Inc. ‡ ^ | 56,300 | 2,562 | ||||||
Health Care Technology (0.9%) | ||||||||
Cerner Corp. ‡ ^ | 38,000 | 1,415 | ||||||
Hotels, Restaurants & Leisure (1.1%) | ||||||||
Burger King Holdings, Inc. ^ | 85,700 | 1,704 | ||||||
Internet Software & Services (0.4%) | ||||||||
Valueclick, Inc. ‡ ^ | 96,000 | 710 | ||||||
IT Services (3.6%) | ||||||||
Alliance Data Systems Corp. ‡ ^ | 37,200 | 1,866 | ||||||
NeuStar, Inc. -Class A ‡ | 197,000 | 3,881 | ||||||
Leisure Equipment & Products (1.0%) | ||||||||
Hasbro, Inc. ^ | 55,100 | 1,602 | ||||||
Life Sciences Tools & Services (6.2%) | ||||||||
Covance, Inc. ‡ ^ | 81,400 | 4,070 | ||||||
Techne Corp. | 83,755 | 5,781 | ||||||
Machinery (6.3%) | ||||||||
Donaldson Co., Inc. ^ | 134,000 | 4,710 | ||||||
Kennametal, Inc. | 213,000 | 4,520 | ||||||
PACCAR, Inc. | 28,000 | 819 | ||||||
Oil, Gas & Consumable Fuels (0.8%) | ||||||||
Range Resources Corp. | 31,300 | 1,321 | ||||||
Pharmaceuticals (1.4%) | ||||||||
Allergan, Inc. | 56,900 | 2,257 | ||||||
Professional Services (1.2%) | ||||||||
FTI Consulting, Inc. ‡ | 31,700 | 1,847 | ||||||
Real Estate Investment Trusts (1.1%) | ||||||||
Plum Creek Timber Co., Inc. ^ | 48,600 | 1,812 | ||||||
Software (12.8%) | ||||||||
Activision Blizzard, Inc. ‡ ^ | 484,000 | 6,031 | ||||||
Adobe Systems, Inc. ‡ | 70,700 | 1,883 | ||||||
Informatica Corp. ‡ ^ | 132,000 | 1,855 | ||||||
Intuit, Inc. ‡ ^ | 238,000 | 5,964 | ||||||
Macrovision Solutions Corp. ‡ ^ | 104,000 | 1,152 | ||||||
Salesforce.com, Inc. ‡ ^ | 107,400 | 3,325 | ||||||
Specialty Retail (3.5%) | ||||||||
Guess, Inc. ^ | 257,900 | 5,614 | ||||||
Textiles, Apparel & Luxury Goods (1.8%) | ||||||||
Carter’s, Inc. ‡ ^ | 136,500 | 2,899 | ||||||
Trading Companies & Distributors (5.3%) | ||||||||
WW Grainger, Inc. ^ | 106,200 | 8,345 | ||||||
Total Common Stocks (cost $185,349) | 153,711 | |||||||
Principal | Value | |||||||
REPURCHASE AGREEMENT (3.8%) | ||||||||
State Street Repurchase Agreement 0.15%, dated 10/31/2008, to be repurchased at $6,116 on 11/03/2008 à • | $ | 6,116 | 6,116 | |||||
Total Repurchase Agreement (cost $6,116) | 6,116 | |||||||
Shares | ||||||||
SECURITIES LENDING COLLATERAL (25.2%) | ||||||||
State Street Navigator Securities Lending Trust — Prime Portfolio, 2.71% à ▲ | 40,055,670 | 40,056 | ||||||
Total Securities Lending Collateral (cost $40,056) | 40,056 | |||||||
Total Investment Securities (cost $231,521) # | $ | 199,883 | ||||||
NOTES TO SCHEDULE OF INVESTMENTS: | ||
^ | All or a portion of this security is on loan. The value of all securities on loan is $39,145. | |
‡ | Non-income producing security. | |
• | Repurchase agreement is collateralized by a U.S. Government Agency Obligation with an interest rate of 5.00%, and a maturity date of 12/01/2019, and with a market value plus accrued interest of $6,239. | |
à | State Street Bank & Trust Company serves as the accounting, custody, and lending agent for the Fund and provides various services on behalf of the Fund. | |
▲ | Interest rate shown reflects the yield at 10/31/2008. | |
# | Aggregate cost for federal income tax purposes is $231,906. Aggregate gross unrealized appreciation/depreciation for all securities in which there is an excess of value over tax cost were $8,112 and $40,135, respectively. Net unrealized depreciation for tax purposes is $32,023. |
The notes to the financial statements are an integral part of this report.
25
Transamerica High Yield Bond
(unaudited)
(unaudited)
MARKET ENVIRONMENT
The turmoil on Wall Street has now infected Main Street. What began as a sell-off in the small sub-prime mortgage market has snowballed into a global de-leveraging within the financial community. As underlying collateral erodes in price, asset write-downs have called many financial institutions’ capital adequacy into question. As these institutions struggle to maintain their balance sheet, the lifeline of credit to individuals and businesses alike has been all but terminated. The result has been a rapidly deteriorating real economy over the past few months with almost every economic indicator registering clear signs of impending recession.
The authorities have not been oblivious to the seizing-up of financial markets. All stops have been pulled out as the Federal Reserve Board (“Fed”) and US Treasury have introduced numerous and massive liquidity measures into the system to revive the ailing credit markets. The risk of a significant recession and an increasing number of defaults pose the most challenging risk to the portfolio over the next fiscal year.
PERFORMANCE
For the year ended October 31, 2008, Transamerica High Yield Bond Class A returned (25.46)%. By comparison, its benchmark, the Merrill Lynch High Yield Cash Pay Index (“Merrill Lynch High Yield”), returned (26.43)%.
STRATEGY REVIEW
The portfolio’s out-performance for the fiscal year versus Merrill Lynch High Yield was partially attributable to the portfolio’s underweight in CCC securities. For the year, we maintained the allocation to CCC securities in the range of 6-8% of portfolio assets, versus an 18-20% range of CCC securities for the benchmark. The Merrill Lynch CCC index under-performed BB’s by 15.5% and Single B’s by 12.0% during the one year period ended October 31, 2008.
The benefit from our over-weighting in higher rated securities was partially offset by underperformance of several sectors and securities. Negative sector contributors for the previous fiscal year include our over-weight in the gaming sector and underweight in wireless telecommunications. On an individual name basis, over-weight allocations to VeraSun Energy Corporation, R.H. Donnelley Corporation, Nuveen Investments, Inc., Idearc Inc., Smurfit-Stone Container Corporation, and The Bon-Ton Stores, Inc. hurt performance. Positive sector contributors include our underweight in automotive and banking, as well as an overweight in aerospace / defense.
We believe fundamentals will remain challenging over the next twelve months. Unemployment rates are increasing, consumers are retrenching, and profits are declining. The tight credit markets are forcing companies to re-evaluate all non-essential capital spending as access to capital is expensive for high quality companies and inaccessible for many lower quality high yield issuers. In addition, technicals in the high yield market remain very weak as aggressive selling by hedge funds and other levered investors force prices lower.
These weak fundamentals and technicals present a challenging backdrop for the high yield investing. However, the relentless selling has pushed valuations to levels never seen before in the high yield market. As of October 31, 2008, the high yield market is trading approximately 350bps wider than any previous time period.
Currently the portfolio is positioned relatively conservatively, with a low (6.2%) allocation to CCC securities. We believe this defensive positioning is prudent given the weak backdrop and forecast for defaults to increase dramatically from a low 3.1% trailing twelve month rate as of October 31, 2008. In addition, the BB and Single B sub-sectors appear to be the cheapest on a historical basis.
We believe our current strategy has the portfolio set to outperform in the current environment. However, we also believe the recent forced selling is creating opportunities and will look to capitalize on those opportunities as prices dramatically overshoot fair value.
David R. Halfpap, CFA
Bradley J. Beman, CFA, CPA
Benjamin D. Miller, CFA
Bradley J. Beman, CFA, CPA
Benjamin D. Miller, CFA
Co-Portfolio Managers
AEGON USA Investment Management, LLC
AEGON USA Investment Management, LLC
26
![(LINE GRAPH)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025727.gif)
Average Annual Total Return for Periods Ended 10/31/2008
From | Inception | |||||||||||||||||||
1 Year | 5 Years | 10 Years | Inception | Date | ||||||||||||||||
Class A (NAV) | (25.46 | )% | (0.78 | )% | 2.01 | % | 6.61 | % | 6/14/85 | |||||||||||
Class A (POP) | (28.96 | )% | (1.74 | )% | 1.51 | % | 6.39 | % | 6/14/85 | |||||||||||
Merrill Lynch U.S. High Yield, Cash Pay(1) | (26.43 | )% | 0.18 | % | 2.88 | % | 7.58 | % | 6/14/85 | |||||||||||
Class B (NAV) | (26.04 | )% | (1.50 | )% | 1.47 | % | 3.05 | % | 10/1/95 | |||||||||||
Class B (POP) | (29.50 | )% | (1.65 | )% | 1.47 | % | 3.05 | % | 10/1/95 | |||||||||||
Class C (NAV) | (25.89 | )% | (1.47 | )% | N/A | 1.76 | % | 11/11/02 | ||||||||||||
Class C (POP) | (26.59 | )% | (1.47 | )% | N/A | 1.76 | % | 11/11/02 | ||||||||||||
Class I (NAV) | (25.05 | )% | N/A | N/A | (2.72 | )% | 11/8/04 |
NOTES | ||
(1) | The Merrill Lynch U.S. High Yield, Cash Pay Index is an unmanaged index used as a general measure of market performance. Calculations assume dividends and capital gains are reinvested and do not include any managerial expenses. You cannot invest directly in an index. |
The performance data presented represents past performance; future results may vary. Performance data does not reflect the deduction of taxes that would be paid on fund distributions or the redemption of fund shares. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than performance quoted. Please see www.transamericafunds.com for performance data current to the most recent month-end. Public Offering Price (POP) returns include the reinvestment of dividends and capital gains and reflect the maximum sales charge of 4.75% for A shares or the maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 6 years) for Class B shares and 1% (during the first 12 months) for Class C shares. Shares purchased prior to March 1, 2004 are subject to a maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 7 years) for Class B shares and (2% in the 1st year, decreasing to 0% after 2 years) for Class C shares. Net Asset Value (NAV) returns include the reinvestment of dividends and capital gains but do not reflect any sales charges.
Investments in high-yield bonds (“junk bonds”) may be subject to greater volatility and risks as the income derived from these securities is not guaranteed and may be unpredictable. This material must be preceded or accompanied by a current prospectus, which includes specific contents regarding the investment objectives and policies of this Fund.
27
UNDERSTANDING YOUR FUND’S EXPENSES
(unaudited)
(unaudited)
SHAREHOLDER EXPENSES
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, contingent deferred sales charges on redemptions and redemption fees; and (2) ongoing costs, including management fees, 12b-1 distribution and service fees, and other fund expenses.
The following Example is intended to help you understand your ongoing costs (in dollars and cents) of investing in the Fund and to compare these costs with the ongoing costs of investing in other funds.
The Example is based on an investment of $1,000 invested at May 1, 2008 and held for the entire period until October 31, 2008.
ACTUAL EXPENSES
The first line in the table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line of your Fund under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. If your account is an IRA, your expenses could have included a $15 annual fee. The amount of any fee paid through your account would increase the estimate of expenses you paid during the period and decrease your ending account value.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line in the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. As in the case of the actual expense example, if your account is subject to an IRA fee, the amount of the fee paid through your account would increase the hypothetical expenses you would have paid during the period and decrease the hypothetical ending account value.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges, redemption fees, brokerage commissions paid on purchases and sales of fund shares. Therefore, the second line under the Fund in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. If any of these transaction costs were included, your costs would be higher. The expenses shown in the table do not reflect any fees that may be charged to you by brokers, financial intermediaries or other financial institutions.
Beginning | Ending | Annualized | Expenses | |||||||||||||
Account | Account | Expense | Paid During | |||||||||||||
Value | Value | Ratio | Period (a) | |||||||||||||
Class A | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 752.37 | 1.16 | % | $ | 5.11 | ||||||||
Hypothetical (b) | 1,000.00 | 1,019.30 | 1.16 | 5.89 | ||||||||||||
Class B | ||||||||||||||||
Actual | 1,000.00 | 748.40 | 1.84 | 8.09 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,015.89 | 1.84 | 9.32 | ||||||||||||
Class C | ||||||||||||||||
Actual | 1,000.00 | 750.43 | 1.79 | 7.88 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,016.14 | 1.79 | 9.07 | ||||||||||||
Class I | ||||||||||||||||
Actual | 1,000.00 | 753.75 | 0.65 | 2.87 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,021.87 | 0.65 | 3.30 |
(a) | Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days), and divided by the number of days in the year (366 days). | |
(b) | 5% return per year before expenses. |
28
GRAPHICAL PRESENTATION OF SCHEDULE OF INVESTMENTS
By Bond Credit Quality (Moody’s Ratings)
At October 31, 2008
(unaudited)
By Bond Credit Quality (Moody’s Ratings)
At October 31, 2008
(unaudited)
![(PIE CHART)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025728.gif)
Credit Rating Definitions:
Aaa | Obligations rated Aaa are judged to be of the highest quality, with minimal credit risk. | |
Aa | Obligations rated Aa are judged to be of high quality, and are subject to very low credit risk, but their susceptibility to long-term risks appears somewhat greater. | |
A | Obligations rated A are considered upper-medium grade and are subject to low credit risk, but have elements present that suggest a susceptibility to impairment over the long term. | |
Baa | Obligations rated Baa are subject to moderate credit risk. They are considered medium-grade and as such may possess certain speculative characteristics. | |
Ba | Obligations rated Ba are judged to have speculative elements and are subject to substantial credit risk. | |
B | Obligations rated B are considered speculative, are subject to high credit risk, and have generally poor credit risk. | |
Caa | Obligations rated Caa are judged to be of poor standing, are subject to very high credit risk, and have extremely poor credit quality. | |
Ca | Obligations rated Ca are highly speculative and are likely in, or very near, default, with some prospect of recovery of principal and interest. | |
C | Obligations rated C are the lowest rated class of bonds and are typically in default, with little prospect for recovery of principal or interest. | |
NR | Not rated. | |
WR | Withdrawn rating. |
Note: Moody’s appends numerical modifiers 1, 2, and 3 to each generic rating classification from Aa through Caa. The modifier 1 indicates that the obligation ranks in the higher end of its generic rating category; the modifier 2 indicates a mid-range ranking; and the modifier 3 indicates a ranking in the lower end of that generic rating category. Percentage breakdown of the NR category includes Securities Lending Collateral.
29
SCHEDULE OF INVESTMENTS
At October 31, 2008
(all amounts except share amounts in thousands)
At October 31, 2008
(all amounts except share amounts in thousands)
Principal | Value | |||||||
CORPORATE DEBT SECURITIES (92.8%) | ||||||||
Aerospace & Defense (2.6%) | ||||||||
Alliant Techsystems, Inc. | ||||||||
6.75%, due 04/01/2016 | $ | 5,110 | $ | 4,216 | ||||
BE Aerospace, Inc. | ||||||||
8.50%, due 07/01/2018 ^ | 1,800 | 1,548 | ||||||
DRS Technologies, Inc. | ||||||||
6.88%, due 11/01/2013 | 2,725 | 2,698 | ||||||
L-3 Communications Corp. | ||||||||
6.13%, due 07/15/2013 ^ | 3,260 | 2,810 | ||||||
7.63%, due 06/15/2012 | 1,000 | 927 | ||||||
Auto Components (0.6%) | ||||||||
Lear Corp. | ||||||||
5.75%, due 08/01/2014 ^ | 3,955 | 1,582 | ||||||
TRW Automotive, Inc. | ||||||||
7.00%, due 03/15/2014 -144A ^ § | 2,000 | 1,180 | ||||||
Automobiles (0.8%) | ||||||||
General Motors Corp. | ||||||||
7.13%, due 07/15/2013 ^ | 1,500 | 510 | ||||||
7.20%, due 01/15/2011 ^ | 5,265 | 2,132 | ||||||
8.25%, due 07/15/2023 ^ | 2,710 | 867 | ||||||
Beverages (1.8%) | ||||||||
Constellation Brands, Inc. | ||||||||
7.25%, due 09/01/2016 | 6,900 | 5,727 | ||||||
Cott Beverages USA, Inc. | ||||||||
8.00%, due 12/15/2011 ^ | 3,350 | 2,177 | ||||||
Building Products (1.3%) | ||||||||
Owens Corning, Inc. | ||||||||
7.00%, due 12/01/2036 * | 3,690 | 2,337 | ||||||
Ply Gem Industries, Inc. | ||||||||
11.75%, due 06/15/2013 | 5,770 | 3,808 | ||||||
Capital Markets (0.3%) | ||||||||
Nuveen Investments, Inc. | ||||||||
10.50%, due 11/15/2015 -144A | 4,310 | 1,164 | ||||||
Chemicals (2.4%) | ||||||||
Huntsman International LLC | ||||||||
7.38%, due 01/01/2015 ^ * | 3,075 | 2,675 | ||||||
Huntsman LLC | ||||||||
11.63%, due 10/15/2010 | 965 | 955 | ||||||
Ineos Group Holdings PLC | ||||||||
8.50%, due 02/15/2016 -144A | 2,570 | 951 | ||||||
Lyondellbasell Industries AF SCA | ||||||||
8.38%, due 08/15/2015 -144A | 5,230 | 1,830 | ||||||
Noranda Aluminium Acquisition Corp. | ||||||||
6.83%, due 05/15/2015 * | 1,800 | 810 | ||||||
Nova Chemicals Corp. | ||||||||
5.95%, due 11/15/2013 * | 5,400 | 3,618 | ||||||
Commercial Banks (0.4%) | ||||||||
Wells Fargo Capital XV | ||||||||
9.75%, due 12/29/2049 Ž | 2,000 | 1,940 | ||||||
Commercial Services & Supplies (1.0%) | ||||||||
Allied Waste North America, Inc. | ||||||||
7.88%, due 04/15/2013 | 4,905 | 4,562 | ||||||
Communications Equipment (0.3%) | ||||||||
Nortel Networks, Ltd. | ||||||||
9.00%, due 07/15/2011 * | 1,230 | 667 | ||||||
10.75%, due 07/15/2016 -144A | 1,820 | 960 | ||||||
Computers & Peripherals (1.0%) | ||||||||
Seagate Technology, Inc. | ||||||||
6.38%, due 10/01/2011 | 4,730 | 4,210 | ||||||
6.80%, due 10/01/2016 | 950 | 665 | ||||||
Consumer Finance (3.2%) | ||||||||
Ford Motor Credit Co. LLC | ||||||||
7.88%, due 06/15/2010 | 1,400 | 941 | ||||||
9.88%, due 08/10/2011 ^ | 8,575 | 5,404 | ||||||
GMAC LLC | ||||||||
6.75%, due 12/01/2014 | 10,164 | 5,133 | ||||||
7.25%, due 03/02/2011 ^ | 4,975 | 3,062 | ||||||
Containers & Packaging (3.4%) | ||||||||
Graphic Packaging International, Inc. | ||||||||
8.50%, due 08/15/2011 ^ | 5,885 | 4,914 | ||||||
Jefferson Smurfit Corp. US | ||||||||
8.25%, due 10/01/2012 | 7,745 | 3,950 | ||||||
Owens Brockway Glass Container, Inc. | ||||||||
6.75%, due 12/01/2014 | 5,535 | 4,788 | ||||||
8.25%, due 05/15/2013 | 2,000 | 1,870 | ||||||
Diversified Consumer Services (0.8%) | ||||||||
Service Corp. International | ||||||||
6.75%, due 04/01/2016 | 4,950 | 3,787 | ||||||
7.00%, due 06/15/2017 | 175 | 133 | ||||||
Diversified Financial Services (3.5%) | ||||||||
AES Red Oak LLC | ||||||||
9.20%, due 11/30/2029 | 2,125 | 1,817 | ||||||
CDX North America High Yield | ||||||||
8.88%, due 06/29/2013 -144A ^ | 10,000 | 8,300 | ||||||
Firekeepers Development Authority | ||||||||
13.88%, due 05/01/2015 -144A ^ | 2,800 | 1,988 | ||||||
Hawker Beechcraft Acquisition Company LLC | ||||||||
8.50%, due 04/01/2015 | 3,740 | 2,244 | ||||||
JPMorgan Chase & Co. | ||||||||
7.90%, due 04/30/2018 Ž | 2,000 | 1,621 | ||||||
Diversified Telecommunication Services (5.9%) | ||||||||
Cincinnati Bell, Inc. | ||||||||
7.00%, due 02/15/2015 | 1,300 | 884 | ||||||
7.25%, due 07/15/2013 | 1,625 | 1,235 | ||||||
Fairpoint Communications, Inc. | ||||||||
13.13%, due 04/01/2018 -144A | 5,020 | 3,539 | ||||||
Frontier Communications Corp. | ||||||||
6.63%, due 03/15/2015 | 1,360 | 972 | ||||||
9.00%, due 08/15/2031 | 5,415 | 2,924 | ||||||
Level 3 Financing, Inc. | ||||||||
9.25%, due 11/01/2014 | 2,500 | 1,425 | ||||||
Qwest Communications International, Inc. | ||||||||
7.50%, due 02/15/2014 | 7,515 | 5,130 | ||||||
Sprint Capital Corp. | ||||||||
6.90%, due 05/01/2019 ^ | 5,570 | 3,927 | ||||||
Telcordia Technologies, Inc. | ||||||||
8.50%, due 07/15/2012 -144A * | 4,535 | 2,948 | ||||||
Windstream Corp. | ||||||||
8.63%, due 08/01/2016 | 5,250 | 3,964 | ||||||
Electric Utilities (2.5%) | ||||||||
Intergen NV | ||||||||
9.00%, due 06/30/2017 -144A | 5,100 | 4,080 | ||||||
Ipalco Enterprises, Inc. | ||||||||
7.25%, due 04/01/2016 -144A | 1,365 | 1,140 | ||||||
Texas Competitive Electric Holdings Co. LLC | ||||||||
10.25%, due 11/01/2015 -144A | 8,545 | 6,516 |
The notes to the financial statements are an integral part of this report.
30
Principal | Value | |||||||
Electronic Equipment & Instruments (0.5%) | ||||||||
NXP BV / NXP Funding LLC | ||||||||
7.50%, due 10/15/2013 ^ * | $ | 5,440 | $ | 2,394 | ||||
Food & Staples Retailing (1.1%) | ||||||||
Supervalu, Inc. | ||||||||
7.50%, due 11/15/2014 | 6,000 | 4,920 | ||||||
Food Products (3.3%) | ||||||||
Dean Foods Co. | ||||||||
7.00%, due 06/01/2016 ^ | 4,550 | 3,458 | ||||||
Del Monte Corp. | ||||||||
6.75%, due 02/15/2015 | 1,075 | 887 | ||||||
8.63%, due 12/15/2012 * | 3,190 | 2,887 | ||||||
Dole Food Co., Inc. | ||||||||
7.25%, due 06/15/2010 | 2,300 | 1,679 | ||||||
Smithfield Foods, Inc. | ||||||||
7.75%, due 07/01/2017 ^ | 6,775 | 4,308 | ||||||
Tyson Foods, Inc. | ||||||||
7.00%, due 05/01/2018 | 2,400 | 1,628 | ||||||
Health Care Equipment & Supplies (1.9%) | ||||||||
Boston Scientific Corp. | ||||||||
6.25%, due 11/15/2015 * | 4,100 | 3,300 | ||||||
Cooper Cos., Inc. | ||||||||
7.13%, due 02/15/2015 | 3,145 | 2,516 | ||||||
Universal Hospital Services, Inc. | ||||||||
6.30%, due 06/01/2015 * | 1,500 | 1,020 | ||||||
8.50%, due 06/01/2015 | 2,300 | 1,840 | ||||||
Health Care Providers & Services (5.6%) | ||||||||
Community Health Systems, Inc. | ||||||||
8.88%, due 07/15/2015 ^ | 8,250 | 6,909 | ||||||
HCA, Inc. | ||||||||
9.25%, due 11/15/2016 ^ | 8,875 | 7,544 | ||||||
Omnicare, Inc. | ||||||||
6.13%, due 06/01/2013 | 3,900 | 3,198 | ||||||
6.88%, due 12/15/2015 | 600 | 462 | ||||||
US Oncology, Inc. | ||||||||
9.00%, due 08/15/2012 | 8,975 | 7,449 | ||||||
Hotels, Restaurants & Leisure (5.6%) | ||||||||
Harrah’s Operating Co., Inc. | ||||||||
10.75%, due 02/01/2016 -144A § | 9,750 | 3,169 | ||||||
Mashantucket Western Pequot Tribe | ||||||||
8.50%, due 11/15/2015 -144A | 6,000 | 3,300 | ||||||
MGM Mirage, Inc. | ||||||||
5.88%, due 02/27/2014 ^ | 2,500 | 1,481 | ||||||
6.75%, due 04/01/2013 ^ | 3,000 | 1,875 | ||||||
7.50%, due 06/01/2016 ^ | 3,125 | 1,844 | ||||||
Mohegan Tribal Gaming Authority | ||||||||
7.13%, due 08/15/2014 ^ | 3,275 | 1,965 | ||||||
Royal Caribbean Cruises, Ltd. | ||||||||
7.00%, due 06/15/2013 | 4,850 | 3,371 | ||||||
Seminole Hard Rock Entertainment, Inc. | ||||||||
5.32%, due 03/15/2014 -144A * | 5,955 | 3,930 | ||||||
Station Casinos, Inc. | ||||||||
6.00%, due 04/01/2012 ^ | 5,485 | 2,016 | ||||||
6.50%, due 02/01/2014 ^ | 2,620 | 285 | ||||||
Vail Resorts, Inc. | ||||||||
6.75%, due 02/15/2014 ^ | 1,325 | 1,014 | ||||||
Wynn Las Vegas Capital Corp. | ||||||||
6.63%, due 12/01/2014 | 2,200 | 1,623 | ||||||
Household Durables (3.4%) | ||||||||
Centex Corp. | ||||||||
4.55%, due 11/01/2010 | 1,400 | 1,092 | ||||||
5.25%, due 06/15/2015 | 925 | 546 | ||||||
5.70%, due 05/15/2014 | 2,000 | 1,340 | ||||||
DR Horton, Inc. | ||||||||
4.88%, due 01/15/2010 | 4,000 | 3,430 | ||||||
5.25%, due 02/15/2015 | 2,008 | 1,135 | ||||||
Jarden Corp. | ||||||||
7.50%, due 05/01/2017 ^ | 3,390 | 2,526 | ||||||
Meritage Homes Corp. | ||||||||
6.25%, due 03/15/2015 | 3,795 | 1,945 | ||||||
Pulte Homes, Inc. | ||||||||
5.20%, due 02/15/2015 | 2,000 | 1,240 | ||||||
7.88%, due 08/01/2011 | 2,500 | 2,119 | ||||||
Independent Power Producers & Energy Traders (3.3%) | ||||||||
Edison Mission Energy | ||||||||
7.50%, due 06/15/2013 | 3,725 | 3,138 | ||||||
7.75%, due 06/15/2016 | 2,000 | 1,605 | ||||||
LSP Energy, LP/LSP Batesville Funding Corp. | ||||||||
7.16%, due 01/15/2014 | 3,657 | 3,456 | ||||||
NRG Energy, Inc. | ||||||||
7.25%, due 02/01/2014 | 4,020 | 3,517 | ||||||
7.38%, due 01/15/2017 | 3,000 | 2,592 | ||||||
Insurance (0.2%) | ||||||||
American International Group, Inc. | ||||||||
8.25%, due 08/15/2018 -144A | 2,000 | 824 | ||||||
IT Services (4.9%) | ||||||||
Aramark Corp. | ||||||||
8.50%, due 02/01/2015 ^ | 7,800 | 6,669 | ||||||
Broadridge Financial Solutions, Inc. | ||||||||
6.13%, due 06/01/2017 | 775 | 553 | ||||||
Ceridian Corp. | ||||||||
11.25%, due 11/15/2015 -144A | 2,930 | 1,824 | ||||||
12.25%, due 11/15/2015 -144A Ω ^ | 325 | 202 | ||||||
DI Finance/Dyncorp International | ||||||||
9.50%, due 02/15/2013 -144A | 1,700 | 1,458 | ||||||
9.50%, due 02/15/2013 | 3,305 | 2,826 | ||||||
SunGard Data Systems, Inc. | ||||||||
9.13%, due 08/15/2013 | 5,360 | 4,449 | ||||||
10.25%, due 08/15/2015 | 450 | 315 | ||||||
Unisys Corp. | ||||||||
8.00%, due 10/15/2012 ^ | 2,750 | 1,736 | ||||||
12.50%, due 01/15/2016 | 3,200 | 2,232 | ||||||
Machinery (0.7%) | ||||||||
Case New Holland, Inc. | ||||||||
7.13%, due 03/01/2014 | 4,225 | 3,148 | ||||||
Media (8.2%) | ||||||||
Cablevision Systems Corp. | ||||||||
8.00%, due 04/15/2012 ^ * | 1,729 | 1,455 | ||||||
CCH I LLC / CCH I Capital Corp. | ||||||||
11.00%, due 10/01/2015 ^ | 4,075 | 1,834 | ||||||
Charter Communications Operating LLC | ||||||||
8.38%, due 04/30/2014 -144A | 3,500 | 2,537 | ||||||
CSC Holdings, Inc. | ||||||||
7.63%, due 07/15/2018 | 4,850 | 3,520 | ||||||
8.50%, due 06/15/2015 -144A | 2,925 | 2,472 | ||||||
DEX Media, Inc. | ||||||||
8.00%, due 11/15/2013 | 2,500 | 550 |
The notes to the financial statements are an integral part of this report.
31
Principal | Value | |||||||
Media (continued) | ||||||||
DIRECTV Financing Co. | ||||||||
7.63%, due 05/15/2016 -144A | $ | 2,035 | $ | 1,709 | ||||
8.38%, due 03/15/2013 | 3,850 | 3,609 | ||||||
Echostar DBS Corp. | ||||||||
6.63%, due 10/01/2014 | 3,740 | 3,001 | ||||||
7.00%, due 10/01/2013 | 1,045 | 867 | ||||||
7.75%, due 05/31/2015 | 3,080 | 2,502 | ||||||
Idearc, Inc. | ||||||||
8.00%, due 11/15/2016 ^ | 7,855 | 1,090 | ||||||
Intelsat Corp. | ||||||||
9.25%, due 06/15/2016 -144A | 2,715 | 2,253 | ||||||
Intelsat Subsidiary Holding Co., Ltd. | ||||||||
8.50%, due 01/15/2013 -144A | 1,420 | 1,235 | ||||||
Knight-Ridder, Inc. | ||||||||
5.75%, due 09/01/2017 | 1,675 | 486 | ||||||
Lamar Media Corp. | ||||||||
6.63%, due 08/15/2015 | 1,525 | 1,121 | ||||||
Liberty Media LLC | ||||||||
5.70%, due 05/15/2013 ^ | 2,500 | 1,739 | ||||||
Medianews Group, Inc. | ||||||||
6.88%, due 10/01/2013 | 1,500 | 142 | ||||||
Quebecor Media, Inc. | ||||||||
7.75%, due 03/15/2016 | 1,250 | 866 | ||||||
RH Donnelley Corp. | ||||||||
8.88%, due 10/15/2017 ^ | 90 | 19 | ||||||
11.75%, due 05/15/2015 -144A ^ | 8,507 | 3,318 | ||||||
Univision Communications, Inc. | ||||||||
9.75%, due 03/15/2015 -144A § | 2,325 | 477 | ||||||
Videotron Ltee | ||||||||
6.88%, due 01/15/2014 | 1,825 | 1,515 | ||||||
Metals & Mining (0.6%) | ||||||||
Steel Dynamics, Inc. | ||||||||
7.38%, due 11/01/2012 | 3,950 | 2,938 | ||||||
Multiline Retail (0.2%) | ||||||||
Bon-Ton Department Stores, Inc. | ||||||||
10.25%, due 03/15/2014 ^ | 5,125 | 820 | ||||||
Multi-Utilities (0.3%) | ||||||||
CMS Energy Corp. | ||||||||
6.55%, due 07/17/2017 | 840 | 644 | ||||||
6.88%, due 12/15/2015 | 1,340 | 1,096 | ||||||
Oil, Gas & Consumable Fuels (10.7%) | ||||||||
Chesapeake Energy Corp. | ||||||||
6.88%, due 01/15/2016 | 2,000 | 1,605 | ||||||
7.00%, due 08/15/2014 ^ | 3,400 | 2,728 | ||||||
7.25%, due 12/15/2018 | 830 | 627 | ||||||
7.63%, due 07/15/2013 | 100 | 85 | ||||||
Cimarex Energy Co. | ||||||||
7.13%, due 05/01/2017 | 1,295 | 1,036 | ||||||
Connacher Oil And Gas, Ltd. | ||||||||
10.25%, due 12/15/2015 -144A | 2,480 | 1,736 | ||||||
Dynegy Holdings, Inc. | ||||||||
7.50%, due 06/01/2015 | 2,975 | 2,172 | ||||||
7.75%, due 06/01/2019 | 4,440 | 2,975 | ||||||
El Paso Corp. | ||||||||
6.88%, due 06/15/2014 | 1,060 | 844 | ||||||
7.25%, due 06/01/2018 ^ | 3,100 | 2,325 | ||||||
Forest Oil Corp. | ||||||||
7.25%, due 06/15/2019 -144A | 2,000 | 1,360 | ||||||
7.75%, due 05/01/2014 | 275 | 220 | ||||||
Kinder Morgan Finance Co. | ||||||||
5.70%, due 01/05/2016 ^ | 5,810 | 4,503 | ||||||
Mariner Energy, Inc. | ||||||||
8.00%, due 05/15/2017 | 1,555 | 917 | ||||||
Newfield Exploration Co. | ||||||||
6.63%, due 09/01/2014 | 2,175 | 1,680 | ||||||
7.13%, due 05/15/2018 ^ | 295 | 208 | ||||||
Opti Canada, Inc. | ||||||||
7.88%, due 12/15/2014 | 2,500 | 1,500 | ||||||
8.25%, due 12/15/2014 | 800 | 476 | ||||||
Peabody Energy Corp. | ||||||||
6.88%, due 03/15/2013 | 1,350 | 1,185 | ||||||
7.38%, due 11/01/2016 | 5,220 | 4,411 | ||||||
Pioneer Natural Resources Co. | ||||||||
6.65%, due 03/15/2017 | 3,225 | 2,429 | ||||||
Plains Exploration & Production Co. | ||||||||
7.00%, due 03/15/2017 | 1,700 | 1,113 | ||||||
7.75%, due 06/15/2015 | 3,450 | 2,518 | ||||||
Roseton/Danskammer | ||||||||
7.67%, due 11/08/2016 | 800 | 601 | ||||||
Sandridge Energy, Inc. | ||||||||
8.00%, due 06/01/2018 -144A | 1,530 | 1,017 | ||||||
Tesoro Corp. | ||||||||
6.25%, due 11/01/2012 | 4,775 | 3,653 | ||||||
6.63%, due 11/01/2015 ^ | 675 | 459 | ||||||
Verasun Energy Corp. | ||||||||
9.38%, due 06/01/2017 ^ Џ | 4,325 | 368 | ||||||
9.88%, due 12/15/2012 ^ Џ | 3,140 | 1,287 | ||||||
Whiting Petroleum Corp. | ||||||||
7.00%, due 02/01/2014 | 3,830 | 2,719 | ||||||
Paper & Forest Products (4.2%) | ||||||||
Abitibi-Consolidated, Inc. | ||||||||
8.55%, due 08/01/2010 ^ | 1,460 | 365 | ||||||
8.85%, due 08/01/2030 ^ | 5,015 | 928 | ||||||
13.75%, due 04/01/2011 -144A | 3,200 | 2,528 | ||||||
Boise Cascade LLC | ||||||||
7.13%, due 10/15/2014 | 896 | 502 | ||||||
Domtar Corp. | ||||||||
7.88%, due 10/15/2011 | 5,720 | 4,919 | ||||||
Georgia-Pacific LLC | ||||||||
7.00%, due 01/15/2015 -144A | 7,825 | 5,751 | ||||||
7.13%, due 01/15/2017 -144A | 1,153 | 801 | ||||||
Newpage Corp. | ||||||||
10.00%, due 05/01/2012 | 1,500 | 1,020 | ||||||
Westvaco Corp. | ||||||||
8.20%, due 01/15/2030 ^ | 2,300 | 1,837 | ||||||
Real Estate Investment Trusts (0.5%) | ||||||||
Host Hotels & Resorts, Inc. | ||||||||
7.13%, due 11/01/2013 ^ | 3,155 | 2,477 | ||||||
Real Estate Management & Development (0.4%) | ||||||||
Realogy Corp. | ||||||||
10.50%, due 04/15/2014 ^ | 5,305 | 1,698 | ||||||
Road & Rail (1.8%) | ||||||||
Avis Budget Car Rental | ||||||||
7.75%, due 05/15/2016 ^ * | 6,020 | 2,197 | ||||||
Hertz Corp. | ||||||||
8.88%, due 01/01/2014 | 4,150 | 3,029 | ||||||
Kansas City Southern Railway | ||||||||
8.00%, due 06/01/2015 | 3,235 | 2,661 |
The notes to the financial statements are an integral part of this report.
32
Principal | Value | |||||||
Semiconductors & Semiconductor Equipment (1.4%) | ||||||||
Freescale Semiconductor, Inc. | ||||||||
8.88%, due 12/15/2014 | $ | 7,345 | $ | 3,269 | ||||
Spansion, Inc. | ||||||||
5.94%, due 06/01/2013 -144A * | 3,960 | 851 | ||||||
Stats ChipPAC, Ltd. | ||||||||
6.75%, due 11/15/2011 | 2,750 | 2,337 | ||||||
Software (0.6%) | ||||||||
First Data Corp. | ||||||||
9.88%, due 09/24/2015 | 4,136 | 2,647 | ||||||
Textiles, Apparel & Luxury Goods (1.3%) | ||||||||
Levi Strauss & Co. | ||||||||
8.88%, due 04/01/2016 ^ | 1,200 | 786 | ||||||
9.75%, due 01/15/2015 ^ | 7,480 | 5,236 | ||||||
Wireless Telecommunication Services (0.3%) | ||||||||
Nextel Communications, Inc. | ||||||||
6.88%, due 10/31/2013 | 2,225 | 1,268 | ||||||
Total Corporate Debt Securities (cost $601,570) | 424,030 | |||||||
REPURCHASE AGREEMENT (3.9%) | ||||||||
State Street Repurchase Agreement 0.15%, dated 10/31/2008, to be repurchased at $17,823 on 11/03/2008. ◊ • | 17,823 | 17,823 | ||||||
Total Repurchase Agreement (cost $17,823) | 17,823 | |||||||
Shares | ||||||||
SECURITIES LENDING COLLATERAL (14.6%) | ||||||||
State Street Navigator Securities Lending Trust - Prime Portfolio, 2.71% ◊ ▲ | 66,811,083 | 66,811 | ||||||
Total Securities Lending Collateral (cost $66,811) | 66,811 | |||||||
Total Investment Securities (cost $686,204) | $ | 508,664 | ||||||
NOTES TO SCHEDULE OF INVESTMENTS: | ||
^ | All or a portion of this security is on loan. The value of all securities on loan is $65,402. | |
* | Floating or variable rate note. Rate is listed as of 10/31/2008. | |
Ž | The security has a perpetual maturity. The date shown is the next call date. | |
Ω | Payment in-kind. | |
Џ | In default. | |
• | Repurchase agreement is collateralized by a U.S. Government Agency Obligation with an interest rate of 4.00%, and a maturity date of 06/01/2014, and with a market value plus accrued interest of $18,179. | |
§ | Illiquid. At 10/31/2008, these securities aggregated $4,826, or 1.06% of the Fund’s net assets. | |
◊ | State Street Bank & Trust Company serves as the accounting, custody, and lending agent for the Fund and provides various services on behalf of the Fund. | |
▲ | Interest rate shown reflects the yield at 10/31/2008. | |
# | Aggregate cost for federal income tax purposes is $686,319. Aggregate gross unrealized appreciation/depreciation for all securities in which there is an excess of value over tax cost were $919 and $178,574, respectively. Net unrealized depreciation for tax purposes is $177,655. | |
DEFINITIONS: | ||
144A | 144A Securities are registered pursuant to Rule 144A of the Securities Act of 1933. These securities are deemed to be liquid for purposes of compliance limitations on holdings of illiquid securities and may be resold as transactions exempt from registration, normally to qualified institutional buyers. At 10/31/2008, these securities aggregated $77,348, or 16.89% of the Fund’s net assets. | |
LLC | Limited Liability Company | |
LP | Limited Partnership | |
PLC | Public Limited Company |
The notes to the financial statements are an integral part of this report.
33
Transamerica Legg Mason Partners All Cap
(unaudited)
(unaudited)
MARKET ENVIRONMENT
The stock market experienced rising volatility during the last fiscal year, with this reaching very high levels toward the end of the year. Concerns over the financial conditions within the banking and financial services sectors led to sharp declines in most stock indices. Exacerbating the decline in equity values were the actions of hedge funds which apparently had to liquidate some of their major holdings in the last quarter of fiscal 2008.
Outside of the financial services sector, many companies are in the strongest cash and financial positions in history. There is a long list of publicly traded corporations whose enterprise values are less than equal to 90% of the total value of their common stocks. In other words, many companies have at least a net cash position of 10% of the value of their shares outstanding. Because of this, the market performance of many companies seemed divorced from reality as the fiscal year wore on. Economic uncertainties accounted for some of this but we believe the action of hedge funds was equally or more important. In recent years, hedge funds have made up an increasing percentage of daily trading and often times their focus is short-term in nature. The use of leverage by many hedge funds accentuated their effect on the stock market, especially during the third quarter in 2008.
Our principal response was to do our best to avoid the “problem companies” in fiscal 2008. In the last market cycle (2001-2002), the poster children for bad corporate behavior were Enron Corporation, WorldCom, and Adelphia Communications Corporation. During 2008, The Bear Stearns Companies Inc., American International Group, Inc., Lehman Brothers Holdings Inc., Federal National Mortgage Association (“Fannie Mae”) and Federal Home Loan Mortgage Corporation (“Freddie Mac”), the latter two Government Sponsored Enterprises all declared bankruptcy or were forced into receivership. We held none of these companies in the portfolio during the periods leading up to their bankruptcies.
With the stock market focusing on the credit and liquidity problems in the banking sector, we focused on those companies whose balance sheets were strong and whose longer term business prospects were sound, in our opinion. Although we are an all-cap manager, analysis suggested that larger companies represented a very attractive segment of the market on both relative and absolute basis. Larger companies seem as cheap as they have been at any time in the last 25 years. They now make up a larger percentage of our portfolios than at any time in the last 5 years.
PERFORMANCE
For the year ended October 31, 2008, Transamerica Legg Mason Partners All Cap Class A returned (35.81)%. By comparison, its benchmark, the Russell 3000 Index, returned (36.60)%.
STRATEGY REVIEW
For the fiscal year, stock selection in the financials and consumer staples sectors contributed to absolute performance while energy and information technology sectors detracted the most from absolute performance.
The top stock contributors to portfolio performance during the fiscal year were Wal-Mart Stores, Inc. (“Wal-Mart”), The Chubb Corporation (“Chubb”), Visa Inc., Verisign Inc., and AirTran Holdings Inc. The largest detractors from performance were Motorola, Inc.,Vodafone Group Plc — ADS, General Electric Company, Merrill Lynch & Co., Inc., and Samsung Electronics Co., Ltd. GDR (“Samsung”).
John J. Goode
Peter J. Hable
Peter J. Hable
Co-Portfolio Managers
ClearBridge Advisors, LLC
ClearBridge Advisors, LLC
34
![(LINE GRAPH)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025729.gif)
Average Annual Total Return for Periods Ended 10/31/2008
From | Inception | ||||||||||||||||
1 Year | 5 Years | Inception | Date | ||||||||||||||
Class A (NAV) | (35.81 | )% | (1.12 | )% | 3.47 | % | 3/1/99 | ||||||||||
Class A (POP) | (39.33 | )% | (2.23 | )% | 2.87 | % | 3/1/99 | ||||||||||
Russell 3000(1) | (36.60 | )% | 0.46 | % | (0.15 | )% | 3/1/99 | ||||||||||
Class B (NAV) | (36.18 | )% | (1.78 | )% | 2.91 | % | 3/1/99 | ||||||||||
Class B (POP) | (39.06 | )% | (1.93 | )% | 2.91 | % | 3/1/99 | ||||||||||
Class C (NAV) | (36.17 | )% | (1.74 | )% | 3.21 | % | 11/11/02 | ||||||||||
Class C (POP) | (36.75 | )% | (1.74 | )% | 3.21 | % | 11/11/02 |
NOTES | ||
(1) | The Russell 3000 Index is an unmanaged index used as a general measure of market performance. Calculations assume dividends and capital gains are reinvested and do not include any managerial expenses. You cannot invest directly in an index. |
The performance data presented represents past performance; future results may vary. Performance data does not reflect the deduction of taxes that would be paid on fund distributions or the redemption of fund shares. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than performance quoted. Please see www.transamericafunds.com for performance data current to the most recent month-end. Public Offering Price (POP) returns include the reinvestment of dividends and capital gains and reflect the maximum sales charge of 5.5% for A shares or the maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 6 years) for Class B shares and 1% (during the first 12 months) for Class C shares. Shares purchased prior to March 1, 2004 are subject to a maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 7 years) for Class B shares and (2% in the 1st year, decreasing to 0% after 2 years) for Class C shares. Net Asset Value (NAV) returns include the reinvestment of dividends and capital gains but do not reflect any sales charges.
This material must be preceded or accompanied by a current prospectus, which includes specific contents regarding the investment objectives and policies of this Fund.
35
UNDERSTANDING YOUR FUND’S EXPENSES
(unaudited)
(unaudited)
SHAREHOLDER EXPENSES
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, contingent deferred sales charges on redemptions and redemption fees; and (2) ongoing costs, including management fees, 12b-1 distribution and service fees, and other fund expenses.
The following Example is intended to help you understand your ongoing costs (in dollars and cents) of investing in the Fund and to compare these costs with the ongoing costs of investing in other funds.
The Example is based on an investment of $1,000 invested at May 1, 2008 and held for the entire period until October 31, 2008.
ACTUAL EXPENSES
The first line in the table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line of your Fund under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. If your account is an IRA, your expenses could have included a $15 annual fee. The amount of any fee paid through your account would increase the estimate of expenses you paid during the period and decrease your ending account value.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line in the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. As in the case of the actual expense example, if your account is subject to an IRA fee, the amount of the fee paid through your account would increase the hypothetical expenses you would have paid during the period and decrease the hypothetical ending account value.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges, redemption fees, brokerage commissions paid on purchases and sales of fund shares. Therefore, the second line under the Fund in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. If any of these transaction costs were included, your costs would be higher. The expenses shown in the table do not reflect any fees that may be charged to you by brokers, financial intermediaries or other financial institutions.
Beginning | Ending | Annualized | Expenses | |||||||||||||
Account | Account | Expense | Paid During | |||||||||||||
Value | Value | Ratio | Period (a) | |||||||||||||
Class A | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 692.91 | 1.55 | % | $ | 6.60 | ||||||||
Hypothetical (b) | 1,000.00 | 1,017.34 | 1.55 | 7.86 | ||||||||||||
Class B | ||||||||||||||||
Actual | 1,000.00 | 690.95 | 2.20 | 9.35 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,014.08 | 2.20 | 11.14 | ||||||||||||
Class C | ||||||||||||||||
Actual | 1,000.00 | 691.43 | 2.11 | 8.97 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,014.53 | 2.11 | 10.68 |
(a) | Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days), and divided by the number of days in the year (366 days). | |
(b) | 5% return per year before expenses. |
GRAPHICAL PRESENTATION OF SCHEDULE OF INVESTMENTS
By Sector
At October 31, 2008
(unaudited)
By Sector
At October 31, 2008
(unaudited)
![(PIE CHART)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025730.gif)
This chart shows the percentage breakdown by Sector of the Fund’s total investment securities. Percentage breakdown of the Short-term category includes Securities Lending Collateral.
36
SCHEDULE OF INVESTMENTS
At October 31, 2008
(all amounts except share amounts in thousands)
At October 31, 2008
(all amounts except share amounts in thousands)
Shares | Value | |||||||
COMMON STOCKS (100.0%) | ||||||||
Aerospace & Defense (5.6%) | ||||||||
Boeing Co. | 21,270 | $ | 1,112 | |||||
Honeywell International, Inc. | 37,120 | 1,130 | ||||||
Raytheon Co. | 40,360 | 2,063 | ||||||
Air Freight & Logistics (2.2%) | ||||||||
United Parcel Service, Inc. -Class B ^ | 31,900 | 1,684 | ||||||
Building Products (0.4%) | ||||||||
Simpson Manufacturing Co., Inc. ^ | 13,130 | 302 | ||||||
Capital Markets (1.3%) | ||||||||
Franklin Resources, Inc. ^ | 14,380 | 978 | ||||||
Chemicals (1.6%) | ||||||||
E.I. duPont de Nemours & Co. ^ | 39,250 | 1,256 | ||||||
Commercial Banks (4.6%) | ||||||||
Comerica, Inc. ^ | 35,170 | 970 | ||||||
East-West Bancorp, Inc. ^ | 18,105 | 314 | ||||||
State Street Corp. ◊ | 41,760 | 1,810 | ||||||
Synovus Financial Corp. | 47,700 | 493 | ||||||
Communications Equipment (2.2%) | ||||||||
Cisco Systems, Inc. ‡ | 80,240 | 1,426 | ||||||
Telefonaktiebolaget LM Ericsson ADR ^ | 48,900 | 346 | ||||||
Computers & Peripherals (2.2%) | ||||||||
International Business Machines Corp. ^ | 17,980 | 1,672 | ||||||
Construction & Engineering (0.3%) | ||||||||
Perini Corp. ‡ ^ | 10,900 | 207 | ||||||
Consumer Finance (1.1%) | ||||||||
American Express Co. | 30,750 | 846 | ||||||
Diversified Financial Services (4.8%) | ||||||||
Bank of America Corp. ^ | 35,700 | 863 | ||||||
JPMorgan Chase & Co. | 68,860 | 2,840 | ||||||
Energy Equipment & Services (6.7%) | ||||||||
Baker Hughes, Inc. ^ | 32,500 | 1,136 | ||||||
Halliburton Co. ^ | 55,880 | 1,106 | ||||||
Schlumberger, Ltd. ^ | 28,340 | 1,464 | ||||||
Transocean, Inc. ^ | 6,936 | 571 | ||||||
Weatherford International, Ltd. ‡ | 53,120 | 897 | ||||||
Food & Staples Retailing (3.7%) | ||||||||
Wal-Mart Stores, Inc. ^ | 50,760 | 2,833 | ||||||
Food Products (4.1%) | ||||||||
Kraft Foods, Inc. -Class A ^ | 44,846 | 1,307 | ||||||
Unilever PLC ADR ^ | 41,609 | 939 | ||||||
Unilever PLC | 41,575 | 934 | ||||||
Industrial Conglomerates (3.5%) | ||||||||
General Electric Co. | 72,020 | 1,405 | ||||||
McDermott International, Inc. ‡ | 74,590 | 1,278 | ||||||
Insurance (5.3%) | ||||||||
Allied World Assurance Co. Holdings, Ltd. | 15,670 | 502 | ||||||
Chubb Corp. ^ | 68,310 | 3,540 | ||||||
Internet Software & Services (1.4%) | ||||||||
eBay, Inc. ‡ ^ | 70,860 | 1,082 | ||||||
Life Sciences Tools & Services (1.0%) | ||||||||
ENZO Biochem, Inc. ‡ ^ | 136,137 | 785 | ||||||
Machinery (2.5%) | ||||||||
Caterpillar, Inc. ^ | 24,070 | 919 | ||||||
Dover Corp. | 25,610 | 814 | ||||||
PACCAR, Inc. ^ | 6,000 | 175 | ||||||
Media (4.6%) | ||||||||
Time Warner, Inc. ^ | 137,170 | 1,384 | ||||||
Walt Disney Co. ^ | 82,840 | 2,146 | ||||||
Metals & Mining (1.4%) | ||||||||
Barrick Gold Corp. | 37,290 | 847 | ||||||
Nucor Corp. | 5,700 | 231 | ||||||
Oil, Gas & Consumable Fuels (4.4%) | ||||||||
Anadarko Petroleum Corp. | 27,740 | 979 | ||||||
Chevron Corp. | 9,960 | 743 | ||||||
ConocoPhillips | 8,320 | 433 | ||||||
Exxon Mobil Corp. ^ | 12,760 | 946 | ||||||
Murphy Oil Corp. ^ | 3,800 | 192 | ||||||
Paper & Forest Products (1.1%) | ||||||||
Weyerhaeuser Co. ^ | 22,820 | 872 | ||||||
Pharmaceuticals (12.9%) | ||||||||
Abbott Laboratories | 43,170 | 2,381 | ||||||
Johnson & Johnson | 35,190 | 2,159 | ||||||
Merck & Co., Inc. ^ | 33,558 | 1,039 | ||||||
Novartis AG ADR | 50,270 | 2,563 | ||||||
Wyeth | 58,390 | 1,879 | ||||||
Professional Services (0.2%) | ||||||||
Robert Half International, Inc. ^ | 9,900 | 187 | ||||||
Real Estate Investment Trusts (0.1%) | ||||||||
LaSalle Hotel Properties | 4,800 | 68 | ||||||
Semiconductors & Semiconductor Equipment (11.6%) | ||||||||
Applied Materials, Inc. ^ | 140,270 | 1,811 | ||||||
Novellus Systems, Inc. ‡ ^ | 63,030 | 996 | ||||||
Samsung Electronics Co., Ltd. -144A GDR | 13,300 | 2,736 | ||||||
Taiwan Semiconductor Manufacturing Co., Ltd. ADR | 159,057 | 1,314 | ||||||
Texas Instruments, Inc. | 102,470 | 2,004 | ||||||
Verigy, Ltd. ‡ ^ | 10,941 | 159 | ||||||
Software (3.1%) | ||||||||
Citrix Systems, Inc. ‡ ^ | 9,100 | 234 | ||||||
Lawson Software, Inc. ‡ ^ | 39,190 | 208 | ||||||
Microsoft Corp. | 87,390 | 1,951 | ||||||
Specialty Retail (4.0%) | ||||||||
Gap, Inc. ^ | 56,030 | 725 | ||||||
Home Depot, Inc. ^ | 84,970 | 2,004 | ||||||
Penske Auto Group, Inc. ^ | 22,600 | 185 | ||||||
Williams-Sonoma, Inc. ^ | 26,160 | 217 | ||||||
Wireless Telecommunication Services (2.1%) | ||||||||
Vodafone Group PLC ADR | 85,687 | 1,651 | ||||||
Total Common Stocks (cost $87,783) | 77,243 | |||||||
Principal | ||||||||
REPURCHASE AGREEMENT (0.2%) | ||||||||
State Street Repurchase Agreement 0.15%, dated 10/31/2008, to be repurchased at $183 on 11/03/2008 ◊ • | $ | 183 | 183 | |||||
Total Repurchase Agreement (cost $183) | 183 | |||||||
Shares | ||||||||
SECURITIES LENDING COLLATERAL (25.9%) | ||||||||
State Street Navigator Securities Lending Trust - Prime Portfolio, 2.71% ◊▲ | 19,953,111 | 19,953 | ||||||
Total Securities Lending Collateral (cost $19,953) | 19,953 | |||||||
Total Investment Securities (cost $107,919) # | $ | 97,379 | ||||||
The notes to the financial statements are an integral part of this report.
37
NOTES TO SCHEDULE OF INVESTMENTS: | ||
^ | All or a portion of this security is on loan. The value of all securities on loan is $19,464. | |
‡ | Non-income producing security. | |
• | Repurchase agreement is collateralized by a U.S. Government Agency Obligation with an interest rate of 5.00%, and a maturity date of 12/01/2019, and with a market value plus accrued interest of $187. | |
◊ | State Street Bank & Trust Company serves as the accounting, custody, and lending agent for the Fund and provides various services on behalf of the Fund. | |
▲ | Interest rate shown reflects the yield at 10/31/2008. | |
# | Aggregate cost for federal income tax purposes is $108,125. Aggregate gross unrealized appreciation/depreciation for all securities in which there is an excess of value over tax cost were $5,738 and $16,484, respectively. Net unrealized depreciation for tax purposes is $10,746. | |
DEFINITIONS: | ||
144A | 144A Securities are registered pursuant to Rule 144A of the Securities Act of 1933. These securities are deemed to be liquid for purposes of compliance limitations on holdings of illiquid securities and may be resold as transactions exempt from registration, normally to qualified institutional buyers. At 10/31/2008, these securities aggregated $2,736, or 3.54% of the Fund’s net assets. | |
ADR | American Depositary Receipt | |
GDR | Global Depositary Receipt | |
PLC | Public Limited Company |
The notes to the financial statements are an integral part of this report.
38
Transamerica Money Market
UNDERSTANDING YOUR FUND’S EXPENSES
(unaudited)
SHAREHOLDER EXPENSES
UNDERSTANDING YOUR FUND’S EXPENSES
(unaudited)
SHAREHOLDER EXPENSES
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, contingent deferred sales charges on redemptions and redemption fees; and (2) ongoing costs, including management fees, 12b-1 distribution and service fees, and other fund expenses.
The following Example is intended to help you understand your ongoing costs (in dollars and cents) of investing in the Fund and to compare these costs with the ongoing costs of investing in other funds.
The Example is based on an investment of $1,000 invested at May 1, 2008 and held for the entire period until October 31, 2008.
ACTUAL EXPENSES
The first line in the table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line of your Fund under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. If your account is an IRA, your expenses could have included a $15 annual fee. The amount of any fee paid through your account would increase the estimate of expenses you paid during the period and decrease your ending account value.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line in the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. As in the case of the actual expense example, if your account is subject to an IRA fee, the amount of the fee paid through your account would increase the hypothetical expenses you would have paid during the period and decrease the hypothetical ending account value.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges, redemption fees, brokerage commissions paid on purchases and sales of fund shares. Therefore, the second line under the Fund in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. If any of these transaction costs were included, your costs would be higher. The expenses shown in the table do not reflect any fees that may be charged to you by brokers, financial intermediaries or other financial institutions.
Beginning | Ending | Annualized | Expenses | |||||||||||||
Account | Account | Expense | Paid During | |||||||||||||
Value | Value | Ratio | Period (a) | |||||||||||||
Class A | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 1,008.96 | 0.83 | % | $ | 4.19 | ||||||||
Hypothetical (b) | 1,000.00 | 1,020.96 | 0.83 | 4.22 | ||||||||||||
Class B | ||||||||||||||||
Actual | 1,000.00 | 1,005.64 | 1.48 | 7.46 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,017.70 | 1.48 | 7.51 | ||||||||||||
Class C | ||||||||||||||||
Actual | 1,000.00 | 1,005.81 | 1.48 | 7.46 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,017.70 | 1.48 | 7.51 | ||||||||||||
Class I | ||||||||||||||||
Actual | 1,000.00 | 1,010.62 | 0.48 | 2.43 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,022.72 | 0.48 | 2.44 |
(a) | Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days), and divided by the number of days in the year (366 days). | |
(b) | 5% return per year before expenses. |
GRAPHICAL PRESENTATION OF SCHEDULE OF INVESTMENTS
By Industry
At October 31, 2008
(unaudited)
By Industry
At October 31, 2008
(unaudited)
![(PIE CHART)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025731.gif)
This chart shows the percentage breakdown by Industry of the Fund’s total investment securities.
39
SCHEDULE OF INVESTMENTS
At October 31, 2008
(all amounts except share amounts in thousands)
At October 31, 2008
(all amounts except share amounts in thousands)
Principal | Value | |||||||
COMMERCIAL PAPER (100.1%) | ||||||||
Beverages (3.5%) | ||||||||
Coca-Cola Co. | ||||||||
1.90%, due 01/08/2009 | $ | 3,550 | $ | 3,537 | ||||
2.25%, due 01/06/2009 | 5,900 | 5,876 | ||||||
Capital Markets (0.6%) | ||||||||
Merrill Lynch & Co., Inc. | ||||||||
2.75%, due 11/25/2008 | 1,500 | 1,497 | ||||||
Commercial Banks (22.2%) | ||||||||
Barclays Bank PLC | ||||||||
2.76%, due 11/13/2008 | 3,400 | 3,397 | ||||||
3.12%, due 11/24/2008 | 5,700 | 5,689 | ||||||
3.25%, due 11/18/2008 | 2,200 | 2,197 | ||||||
4.23%, due 11/14/2008 | 2,100 | 2,097 | ||||||
Canadian Imperial Holdings, Inc. | ||||||||
2.81%, due 11/05/2008 | 1,800 | 1,799 | ||||||
Royal Bank of Scotland PLC | ||||||||
2.63%, due 11/04/2008 | 3,400 | 3,399 | ||||||
2.75%, due 11/06/2008 | 1,900 | 1,899 | ||||||
2.85%, due 12/05/2008 - 12/10/2008 | 8,200 | 8,171 | ||||||
State Street Corp. | ||||||||
2.75%, due 11/26/2008 | 1,100 | 1,098 | ||||||
3.50%, due 11/17/2008 - 11/18/2008 ◊ | 12,300 | 12,281 | ||||||
Toronto-Dominion Holdings USA, Inc. | ||||||||
2.68%, due 11/17/2008 - 144A | 2,000 | 1,998 | ||||||
UBS Finance, Inc. | ||||||||
2.80%, due 11/10/2008 | 1,800 | 1,799 | ||||||
3.16%, due 11/28/2008 | 3,900 | 3,891 | ||||||
3.65%, due 12/04/2008 | 2,900 | 2,890 | ||||||
4.05%, due 11/17/2008 | 4,800 | 4,791 | ||||||
Wells Fargo & Co. | ||||||||
2.59%, due 11/12/2008 | 2,500 | 2,498 | ||||||
Commercial Services & Supplies (1.8%) | ||||||||
Pitney Bowes, Inc. | �� | |||||||
2.05%, due 01/05/2009 - 144A | 4,800 | 4,782 | ||||||
Computers & Peripherals (4.4%) | ||||||||
Hewlett-Packard Co. | ||||||||
2.20%, due 11/04/2008 - 11/10/2008 -144A | 5,400 | 5,398 | ||||||
2.30%, due 11/03/2008 - 144A | 6,600 | 6,599 | ||||||
Diversified Financial Services (55.5%) | ||||||||
Alpine Securitization | ||||||||
3.00%, due 11/13/2008 - 144A | 4,750 | 4,745 | ||||||
3.25%, due 11/12/2008 - 144A | 7,200 | 7,193 | ||||||
3.75%, due 12/03/2008 - 144A | 1,400 | 1,395 | ||||||
American Honda Finance Corp. | ||||||||
2.25%, due 12/02/2008 - 12/03/2008 | 13,350 | 13,323 | ||||||
Bank of America Corp. | ||||||||
2.66%, due 11/03/2008 | 1,150 | 1,150 | ||||||
2.67%, due 12/09/2008 | 1,600 | 1,595 | ||||||
3.43%, due 12/15/2008 | 2,700 | 2,689 | ||||||
Caterpillar Financial Services Corp. | ||||||||
1.75%, due 11/10/2008 - 11/12/2008 | 3,000 | 2,998 | ||||||
1.80%, due 11/17/2008 - 11/20/2008 | 10,300 | 10,291 | ||||||
Ciesco LLC | ||||||||
2.75%, due 12/01/2008 - 144A | 8,800 | 8,780 | ||||||
2.78%, due 11/04/2008 - 144A | 500 | 500 | ||||||
3.00%, due 11/25/2008 - 144A | 4,200 | 4,192 | ||||||
General Electric Capital Corp. | ||||||||
2.52%, due 11/20/2008 | 1,950 | 1,947 | ||||||
2.75%, due 11/24/2008 - 12/05/2008 | 8,500 | 8,483 | ||||||
MetLife Funding, Inc. | ||||||||
2.25%, due 12/03/2008 | 5,000 | 4,990 | ||||||
2.55%, due 11/21/2008 | 6,600 | 6,591 | ||||||
Old Line Funding LLC | ||||||||
2.70%, due 11/06/2008 - 144A | 290 | 290 | ||||||
2.77%, due 11/07/2008 - 11/21/2008 -144A | 4,450 | 4,447 | ||||||
3.50%, due 11/19/2008 - 144A | 2,400 | 2,396 | ||||||
3.70%, due 11/17/2008 - 144A | 1,300 | 1,298 | ||||||
4.10%, due 11/04/2008 - 144A | 3,100 | 3,099 | ||||||
PACCAR Financial Corp. | ||||||||
2.05%, due 11/07/2008 | 5,800 | 5,798 | ||||||
2.15%, due 11/05/2008 - 11/10/2008 | 7,500 | 7,498 | ||||||
Rabobank USA Financial Corp. | ||||||||
2.20%, due 11/24/2008 | 1,600 | 1,598 | ||||||
2.68%, due 11/25/2008 | 5,500 | 5,490 | ||||||
3.20%, due 11/20/2008 | 6,300 | 6,289 | ||||||
Ranger Funding Co. LLC | ||||||||
2.58%, due 11/06/2008 - 144A | 1,700 | 1,699 | ||||||
2.74%, due 11/19/2008 - 144A | 2,200 | 2,197 | ||||||
2.75%, due 11/18/2008 - 144A | 2,550 | 2,547 | ||||||
Toyota Motor Credit Corp. | ||||||||
2.52%, due 11/21/2008 | 1,550 | 1,548 | ||||||
2.85%, due 11/14/2008 | 5,700 | 5,694 | ||||||
3.00%, due 11/13/2008 | 5,700 | 5,694 | ||||||
Wal-Mart Funding Corp. | ||||||||
2.50%, due 11/18/2008 - 144A | 13,350 | 13,334 | ||||||
Diversified Telecommunication Services (4.8%) | ||||||||
AT&T, Inc. | ||||||||
2.00%, due 12/04/2008 - 144A | 8,250 | 8,235 | ||||||
2.10%, due 01/07/2009 - 144A | 5,000 | 4,980 | ||||||
Food Products (2.9%) | ||||||||
Nestle Capital Corp. | ||||||||
2.17%, due 11/14/2008 - 144A | 7,850 | 7,844 | ||||||
Multiline Retail (4.4%) | ||||||||
Walgreen Co. | ||||||||
1.75%, due 11/03/2008 - 144A | 4,000 | 4,000 | ||||||
1.95%, due 11/06/2008 - 144A | 4,100 | 4,099 | ||||||
2.00%, due 11/05/2008 - 144A | 3,750 | 3,749 | ||||||
Total Commercial Paper (cost $272,268) | 272,268 | |||||||
REPURCHASE AGREEMENT (0.7%) | ||||||||
State Street Repurchase Agreement 0.15%, dated 10/31/2008, to be repurchased at $1,865 on 11/03/2008 ◊ • | 1,865 | 1,865 | ||||||
Total Repurchase Agreement (cost $1,865) | 1,865 | |||||||
Total Investment Securities (cost $274,133) # | $ | 274,133 | ||||||
The notes to the financial statements are an integral part of this report.
40
NOTES TO SCHEDULE OF INVESTMENTS: | ||
• | Repurchase agreement is collateralized by a U.S. Government Agency Obligation with an interest rate of 5.89%, and a maturity date of 01/01/2037, and with a market value plus accrued interest of $1,905. | |
◊ | State Street Bank & Trust Company serves as the accounting, custody, and lending agent for the Fund and provides various services on behalf of the Fund. | |
# | Aggregate cost for federal income tax purposes is $274,133. | |
DEFINITIONS: | ||
144A | 144A Securities are registered pursuant to Rule 144A of the Securities Act of 1933. These securities are deemed to be liquid for purposes of compliance limitations on holdings of illiquid securities and may be resold as transactions exempt from registration, normally to qualified institutional buyers. At 10/31/2008, these securities aggregated $109,796, or 40.38% of the Fund’s net assets. | |
LLC | Limited Liability Company | |
PLC | Public Limited Company |
The notes to the financial statements are an integral part of this report.
41
Transamerica Science & Technology
(unaudited)
(unaudited)
MARKET ENVIRONMENT
Faced with many challenges in the twelve months ended October 31, 2008, US equity indices delivered double-digit negative returns across the board. The Dow Jones US Technology Index (“DJ Technology”) declined 40.90%.
Throughout the period, problems plaguing the housing market continued, while commodity prices first soared then plummeted. Meanwhile, what began as concerns about securities related to defaulting sub-prime mortgages escalated into a variety of increasingly severe crises in the markets where banks lend to each other and to businesses, causing extreme disruption in both US and foreign financial markets. As the problems multiplied, financial institutions tightened their lending standards. This made it more difficult for companies to fund payroll, inventory and other near-term expenses in the face of high borrowing costs. Consumers, who already were feeling the effects of higher energy and food prices and lack of wage growth, also found it more difficult to borrow. Although the Federal Reserve Board (“Fed”) and the US government intervened to restore confidence in the financial systems, the US headed toward recession and expectations of a global economic slowdown rose.
PERFORMANCE
For the year ended October 31, 2008, Transamerica Science & Technology Class A returned (48.18)%. By comparison, its benchmark, the DJ Technology, returned (40.90)%.
STRATEGY REVIEW
We position the portfolio to benefit from at least one of several long-term secular trends that we believe can be the source of strong growth for a company. Among these are the digitization of media for mass consumer adoption, and development and delivery of alternative energy and other environmental sustainability projects. Other trends underlying our stock selections are the unique application of technology to gain a competitive edge and the development of biotechnology products and treatments that improve the quality and efficacy of health care.
Despite our focus on these secular growth trends, the stocks in the portfolio were generally unable to withstand the broad-scale sell-off of technology stocks that occurred during the period. Driving that sell-off were hedge funds and other major holders of technology stocks that were forced to sell securities in order to raise capital.
The largest detractors from performance were technology sector holdings (e.g., SiRF Technology Holdings, Inc. (“SiRF”) and SunPower Corporation (“SunPower”)). We sold SiRF, a maker of global positioning systems (“GPS”) semiconductor chips, when it became apparent that the commoditization of GPS chips was occurring more rapidly than we anticipated. SunPower is a manufacturer and installer of solar power technologies. Its stock price fluctuated widely during the period as sales were affected by customers’ difficulty in obtaining financing and investors worried about the future of government subsidies for alternative energy. We maintained the position, in the belief that there will be aggressive pursuit of alternative energy technologies in the coming years.
These declines were partially offset by our overweighting and stock selection in the health care sector (e.g., NuVasive, Inc. (“NuVasive”) and Gilead Sciences, Inc. (“Gilead”)). NuVasive, a medical device company, is benefiting from advancements in spinal surgery techniques. Further, its business is relatively immune from cyclical economic trends. Gilead, a biopharmaceutical company working on treatments for cures to life-threatening diseases, has benefited from competitors’ mergers, which reduced its competition.
We believe a consumer-driven recession has already arrived. We believe the federal government’s $700-billion rescue of the financial services sector, the biggest government intervention in the financial system since the 1930s, should provide some much-needed rationality in the markets. We believe it should help to rebuild trust among financial institutions and reduce the severity of the recession. In the interim, high levels of market volatility likely will persist.
Kirk J. Kim
Joshua D. Shaskan, CFA
Jeffrey J. Hoo, CFA
Erik U. Rollé
Joshua D. Shaskan, CFA
Jeffrey J. Hoo, CFA
Erik U. Rollé
Co-Portfolio Managers
Transamerica Investment Management, LLC
Transamerica Investment Management, LLC
Prior to March 1, 2008, Gary V. Rollé, CFA was also a co-portfolio manager.
42
![(LINE GRAPH)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025732.gif)
Average Annual Total Return for Periods Ended 10/31/2008
From | Inception | ||||||||||||||||
1 Year | 5 Years | Inception | Date | ||||||||||||||
Class A (NAV) | (48.18 | )% | (3.63 | )% | (13.50 | )% | 7/14/00 | ||||||||||
Class A (POP) | (51.03 | )% | (4.72 | )% | (14.08 | )% | 7/14/00 | ||||||||||
Dow Jones U.S. Technology(1) | (40.90 | )% | (2.59 | )% | (12.97 | )% | 7/14/00 | ||||||||||
Class B (NAV) | (48.56 | )% | (4.30 | )% | (14.11 | )% | 7/14/00 | ||||||||||
Class B (POP) | (51.04 | )% | (4.48 | )% | (14.11 | )% | 7/14/00 | ||||||||||
Class C (NAV) | (48.46 | )% | (4.29 | )% | 2.37 | % | 11/11/02 | ||||||||||
Class C (POP) | (48.96 | )% | (4.29 | )% | 2.37 | % | 11/11/02 | ||||||||||
Class I (NAV) | (47.93 | )% | N/A | (8.79 | )% | 11/15/05 |
NOTES | ||
(1) | The Dow Jones U.S. Technology Index is an unmanaged index used as a general measure of market performance. Calculations assume dividends and capital gains are reinvested and do not include any managerial expenses. You cannot invest directly in an index. |
The performance data presented represents past performance; future results may vary. Performance data does not reflect the deduction of taxes that would be paid on fund distributions or the redemption of fund shares. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than performance quoted. Please see www.transamericafunds.com for performance data current to the most recent month-end. Public Offering Price (POP) returns include the reinvestment of dividends and capital gains and reflect the maximum sales charge of 5.5% for A shares or the maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 6 years) for Class B shares and 1% (during the first 12 months) for Class C shares. Shares purchased prior to March 1, 2004 are subject to a maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 7 years) for Class B shares and (2% in the 1st year, decreasing to 0% after 2 years) for Class C shares. Net Asset Value (NAV) returns include the reinvestment of dividends and capital gains but do not reflect any sales charges.
This material must be preceded or accompanied by a current prospectus, which includes specific contents regarding the investment objectives and policies of this Fund.
43
UNDERSTANDING YOUR FUND’S EXPENSES
(unaudited)
(unaudited)
SHAREHOLDER EXPENSES
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, contingent deferred sales charges on redemptions and redemption fees; and (2) ongoing costs, including management fees, 12b-1 distribution and service fees, and other fund expenses.
The following Example is intended to help you understand your ongoing costs (in dollars and cents) of investing in the Fund and to compare these costs with the ongoing costs of investing in other funds.
The Example is based on an investment of $1,000 invested at May 1, 2008 and held for the entire period until October 31, 2008.
ACTUAL EXPENSES
The first line in the table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line of your Fund under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. If your account is an IRA, your expenses could have included a $15 annual fee. The amount of any fee paid through your account would increase the estimate of expenses you paid during the period and decrease your ending account value.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line in the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. As in the case of the actual expense example, if your account is subject to an IRA fee, the amount of the fee paid through your account would increase the hypothetical expenses you would have paid during the period and decrease the hypothetical ending account value.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges, redemption fees, brokerage commissions paid on purchases and sales of fund shares. Therefore, the second line under the Fund in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. If any of these transaction costs were included, your costs would be higher. The expenses shown in the table do not reflect any fees that may be charged to you by brokers, financial intermediaries or other financial institutions.
Beginning | Ending | Annualized | Expenses | |||||||||||||
Account | Account | Expense | Paid During | |||||||||||||
Value | Value | Ratio | Period (a) | |||||||||||||
Class A | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 646.92 | 1.53 | % | $ | 6.33 | ||||||||
Hypothetical (b) | 1,000.00 | 1,017.44 | 1.53 | 7.76 | ||||||||||||
Class B | ||||||||||||||||
Actual | 1,000.00 | 644.23 | 2.18 | 9.01 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,014.18 | 2.18 | 11.04 | ||||||||||||
Class C | ||||||||||||||||
Actual | 1,000.00 | 645.78 | 2.18 | 9.02 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,014.18 | 2.18 | 11.04 | ||||||||||||
Class I | ||||||||||||||||
Actual | 1,000.00 | 647.98 | 0.93 | 3.85 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,020.46 | 0.93 | 4.72 |
(a) | Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days), and divided by the number of days in the year (366 days). | |
(b) | 5% return per year before expenses. |
GRAPHICAL PRESENTATION OF SCHEDULE OF INVESTMENTS
By Sector
At October 31, 2008
(unaudited)
By Sector
At October 31, 2008
(unaudited)
![(PIE CHART)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025733.gif)
This chart shows the percentage breakdown by Sector of the Fund’s total investment securities. Percentage breakdown of the Short-term category includes Securities Lending Collateral.
44
SCHEDULE OF INVESTMENTS
At October 31, 2008
(all amounts except share amounts in thousands)
At October 31, 2008
(all amounts except share amounts in thousands)
Shares | Value | |||||||
COMMON STOCKS (91.9%) | ||||||||
Auto Components (1.3%) | ||||||||
BorgWarner, Inc. ^ | 29,793 | $ | 669 | |||||
Biotechnology (4.7%) | ||||||||
Gilead Sciences, Inc. ‡ | 54,800 | 2,513 | ||||||
Communications Equipment (11.2%) | ||||||||
F5 Networks, Inc. ‡ | 55,500 | 1,378 | ||||||
Polycom, Inc. ‡ ^ | 120,000 | 2,521 | ||||||
Qualcomm, Inc. | 33,000 | 1,263 | ||||||
Research In Motion, Ltd. ‡ ^ | 15,500 | 782 | ||||||
Computers & Peripherals (10.4%) | ||||||||
Apple, Inc. ‡ | 21,935 | 2,360 | ||||||
Data Domain, Inc. ‡ ^ | 53,000 | 978 | ||||||
EMC Corp. ‡ ^ | 124,500 | 1,467 | ||||||
Hewlett-Packard Co. | 21,000 | 804 | ||||||
Diversified Financial Services (3.3%) | ||||||||
CME Group, Inc. -Class A ^ | 6,300 | 1,778 | ||||||
Diversified Telecommunication Services (2.7%) | ||||||||
AT&T, Inc. | 54,100 | 1,448 | ||||||
Electrical Equipment (3.7%) | ||||||||
Fuelcell Energy, Inc. ‡ ^ | 170,800 | 816 | ||||||
Sunpower Corp. -Class A ‡ ^ | 29,500 | 1,152 | ||||||
Electronic Equipment & Instruments (6.4%) | ||||||||
FLIR Systems, Inc. ‡ ^ | 70,000 | 2,247 | ||||||
Itron, Inc. ‡ ^ | 24,000 | 1,164 | ||||||
Health Care Equipment & Supplies (6.4%) | ||||||||
Intuitive Surgical, Inc. ‡ ^ | 9,700 | 1,676 | ||||||
NuVasive, Inc. ‡ ^ | 38,000 | 1,789 | ||||||
Internet & Catalog Retail (4.2%) | ||||||||
Amazon.com, Inc. ‡ ^ | 39,000 | 2,232 | ||||||
Internet Software & Services (10.4%) | ||||||||
Equinix, Inc. ‡ ^ | 17,000 | 1,061 | ||||||
Google, Inc. -Class A ‡ | 8,800 | 3,162 | ||||||
Omniture, Inc. ‡ ^ | 67,000 | 770 | ||||||
Vocus, Inc. ‡ ^ | 34,538 | 581 | ||||||
Machinery (1.7%) | ||||||||
Tennant Co. ^ | 35,500 | 891 | ||||||
Software (20.8%) | ||||||||
Activision Blizzard, Inc. ‡ | 108,000 | 1,346 | ||||||
Adobe Systems, Inc. ‡ ^ | 71,000 | 1,891 | ||||||
Informatica Corp. ‡ ^ | 117,000 | 1,644 | ||||||
Macrovision Solutions Corp. ‡ ^ | 129,500 | 1,435 | ||||||
Nintendo Co., Ltd. ADR | 30,200 | 1,178 | ||||||
Nuance Communications, Inc. ‡ ^ | 140,000 | 1,281 | ||||||
Salesforce.com, Inc. ‡ ^ | 52,500 | 1,625 | ||||||
Ultimate Software Group, Inc. ‡ ^ | 56,500 | 753 | ||||||
Wireless Telecommunication Services (4.7%) | ||||||||
Metropcs Communications, Inc. ‡ ^ | 129,300 | 1,777 | ||||||
NII Holdings, Inc. ‡ ^ | 29,600 | 762 | ||||||
Total Common Stocks (cost $64,224) | 49,194 | |||||||
Principal | ||||||||
REPURCHASE AGREEMENT (8.1%) | ||||||||
State Street Repurchase Agreement 0.15%, dated 10/31/2008, to be repurchased at $4,323 on 11/03/2008 ◊ • | $ | 4,323 | 4,323 | |||||
Total Repurchase Agreement (cost $4,323) | 4,323 | |||||||
Shares | ||||||||
SECURITIES LENDING COLLATERAL (24.7%) | ||||||||
State Street Navigator Securities Lending Trust - Prime Portfolio, 2.71% ◊ ▲ | 13,233,517 | 13,234 | ||||||
Total Securities Lending Collateral (cost $13,234) | 13,234 | |||||||
Total Investment Securities (cost $81,781) # | $ | 66,751 | ||||||
NOTES TO SCHEDULE OF INVESTMENTS: | ||
^ | All or a portion of this security is on loan. The value of all securities on loan is $12,875. | |
‡ | Non-income producing security. | |
• | Repurchase agreement is collateralized by a U.S. Government Agency Obligation with an interest rate of 5.00%, and a maturity date of 02/01/2019, and with a market value plus accrued interest of $4,409. | |
◊ | State Street Bank & Trust Company serves as the accounting, custody, and lending agent for the Fund and provides various services on behalf of the Fund. | |
▲ | Interest rate shown reflects the yield at 10/31/2008. | |
# | Aggregate cost for federal income tax purposes is $81,838. Aggregate gross unrealized appreciation/depreciation for all securities in which there is an excess of value over tax cost were $3,186 and $18,273, respectively. Net unrealized depreciation for tax purposes is $15,087. | |
DEFINITION: | ||
ADR | American Depositary Receipt |
The notes to the financial statements are an integral part of this report.
45
Transamerica Short-Term Bond
(unaudited)
(unaudited)
MARKET ENVIRONMENT
In the twelve months ended October 31, 2008, conditions in the economy and credit markets deteriorated, creating a very unstable environment for bond investors. What began as concerns about securities related to defaulting sub-prime mortgages escalated into a credit and economic crises. Overnight lending between banks, a vital part of maintaining the flow of capital in the financial system, was disrupted as banks increasingly worried about undisclosed risks from exotic securities and the financial strength and stability of other banks. As credit problems multiplied, financial institutions focused on preserving capital and were more selective about lending, making it more difficult for business and consumers to attain credit.
The risk aversion eventually spread from Wall Street to Main Street, where it added to growing problems on the economic front. Throughout the period, the housing market continued to deteriorate, while commodity prices were volatile. Rising unemployment, coupled with lack of wage growth and tighter credit conditions, caused consumers to rein in their spending. The reduction in consumer spending, which is the backbone of the US economy, exacerbated problems further.
The Federal Reserve Board (“Fed”) and the US government intervened on several occasions, taking unprecedented measures to curb the crises, improve liquidity, and stimulate the economy. Among the many initiatives were new government-guaranteed loans, larger and more varied lending facilities for banks, and the takeover of major financial institutions. Even with the government’s intervention, the expectations of a global economic slowdown and US recession rose. Nearing the end of the period, investors flocked to the relative safety of US government debt. While treasury yields declined, concerns over corporate profitability in a slowing economy coupled with reduced liquidity caused the risk premiums to increase for most non-government securities. As this risk premium increased, prices for most non-government securities rose less than Treasuries and in some cases prices fell.
PERFORMANCE
For the year ended October 31, 2008, Transamerica Short-Term Bond Class A returned (1.70)%. By comparison, its benchmark, the Merrill Lynch US Corporate & Government 1-3 Year Index (“MLCG”), returned 3.97%.
STRATEGY REVIEW
Throughout the period, the portfolio generated competitive yields, aided by an overweighting in corporate bonds, an area where yields generally rose. However, as the market tumult came to a head and yield spreads between government and corporate bonds grew, this overweighting hindered performance even though we reduced our exposure to corporates throughout the period. The below-index duration of the portfolio made it less sensitive than the index to changes in interest rates. Therefore, it did not benefit as much as the index when bonds yields fell and bond prices, which move opposite to yields, rose. Helping to mitigate the underperformance were two factors. We were selective in our corporate bond positions, and had no exposure to sub-prime securities. Additionally, as corporate issues matured later in the period, we invested the proceeds into government agency mortgage-backed securities (“MBS”).
Agency MBS were less volatile than other fixed-income securities because the government, in taking over the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”), had strengthened its implied guarantee of these securities.
We believe a consumer-driven recession has already arrived. We believe the federal government’s $700-billion rescue of the financial services sector, combined with several other government actions, should provide some much-needed rationality in the markets. We believe it should help to rebuild trust among financial institutions and reduce the severity of the recession. In the interim, high levels of market volatility likely will persist.
Greg D. Haendel, CFA
Derek S. Brown, CFA
Derek S. Brown, CFA
Co-Portfolio Managers
Transamerica Investment Management, LLC
Transamerica Investment Management, LLC
Prior to October 1, 2008, Heidi Y. Hu, CFA was also a co-portfolio manager.
46
![(LINE GRAPH)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025734.gif)
Average Annual Total Return for Periods Ended 10/31/2008
From | Inception | |||||||||||
1 Year | Inception | Date | ||||||||||
Class I (NAV) | (1.22 | )% | 2.09 | % | 11/8/04 | |||||||
Merrill Lynch U.S. Corporate & Government, 1-3 Yrs(1) | 3.97 | % | 3.97 | % | 11/1/07 | |||||||
Class A (NAV) | (1.70 | )% | (1.70 | )% | 11/1/07 | |||||||
Class A (POP) | (4.19 | )% | (4.19 | )% | 11/1/07 | |||||||
Class C (NAV) | (2.43 | )% | (2.43 | )% | 11/1/07 | |||||||
Class C (POP) | (3.37 | )% | (3.37 | )% | 11/1/07 |
NOTES | ||
(1) | The Merrill Lynch U.S. Corporate & Government, 1-3 Yrs Index is an unmanaged index used as a general measure of market performance. Calculations assume dividends and capital gains are reinvested and do not include any managerial expenses. You cannot invest directly in an index. |
The performance data presented represents past performance; future results may vary. Performance data does not reflect the deduction of taxes that would be paid on fund distributions or the redemption of fund shares. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than performance quoted. Please see www.transamericafunds.com for performance data current to the most recent month-end. Public Offering Price (POP) returns include the reinvestment of dividends and capital gains and reflect the maximum sales charge of 2.5% for A shares or 1% (during the first 12 months) for Class C shares. Net Asset Value (NAV) returns include the reinvestment of dividends and capital gains but do not reflect any sales charges.
This material must be preceded or accompanied by a current prospectus, which includes specific contents regarding the investment objectives and policies of this Fund.
47
UNDERSTANDING YOUR FUND’S EXPENSES
(unaudited)
(unaudited)
SHAREHOLDER EXPENSES
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, contingent deferred sales charges on redemptions and redemption fees; and (2) ongoing costs, including management fees, 12b-1 distribution and service fees, and other fund expenses.
The following Example is intended to help you understand your ongoing costs (in dollars and cents) of investing in the Fund and to compare these costs with the ongoing costs of investing in other funds.
The Example is based on an investment of $1,000 invested at May 1, 2008 and held for the entire period until October 31, 2008.
ACTUAL EXPENSES
The first line in the table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line of your Fund under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. If your account is an IRA, your expenses could have included a $15 annual fee. The amount of any fee paid through your account would increase the estimate of expenses you paid during the period and decrease your ending account value.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line in the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. As in the case of the actual expense example, if your account is subject to an IRA fee, the amount of the fee paid through your account would increase the hypothetical expenses you would have paid during the period and decrease the hypothetical ending account value.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges, redemption fees, brokerage commissions paid on purchases and sales of fund shares. Therefore, the second line under the Fund in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. If any of these transaction costs were included, your costs would be higher. The expenses shown in the table do not reflect any fees that may be charged to you by brokers, financial intermediaries or other financial institutions.
Beginning | Ending | Annualized | Expenses | |||||||||||||
Account | Account | Expense | Paid During | |||||||||||||
Value | Value | Ratio | Period (a) | |||||||||||||
Class A | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 972.84 | 1.13 | % | $ | 5.60 | ||||||||
Hypothetical (b) | 1,000.00 | 1,019.46 | 1.13 | 5.74 | ||||||||||||
Class C | ||||||||||||||||
Actual | 1,000.00 | 968.80 | 1.78 | 8.81 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,016.19 | 1.78 | 9.02 | ||||||||||||
Class I | ||||||||||||||||
Actual | 1,000.00 | 974.04 | 0.70 | 3.47 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,021.62 | 0.70 | 3.56 |
(a) | Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days), and divided by the number of days in the year (366 days). | |
(b) | 5% return per year before expenses. |
48
GRAPHICAL PRESENTATION OF SCHEDULE OF INVESTMENTS
By Bond Credit Quality (Moody’s ratings)
At October 31, 2008
(unaudited)
By Bond Credit Quality (Moody’s ratings)
At October 31, 2008
(unaudited)
![(PIE CHART)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025735.gif)
Credit Rating Definitions:
Aaa | Obligations rated Aaa are judged to be of the highest quality, with minimal credit risk. | |
Aa | Obligations rated Aa are judged to be of high quality, and are subject to very low credit risk, but their susceptibility to long-term risks appears somewhat greater. | |
A | Obligations rated A are considered upper-medium grade and are subject to low credit risk, but have elements present that suggest a susceptibility to impairment over the long term. | |
Baa | Obligations rated Baa are subject to moderate credit risk. They are considered medium-grade and as such may possess certain speculative characteristics. | |
Ba | Obligations rated Ba are judged to have speculative elements and are subject to substantial credit risk. | |
B | Obligations rated B are considered speculative, are subject to high credit risk, and have generally poor credit risk. | |
Caa | Obligations rated Caa are judged to be of poor standing, are subject to very high credit risk, and have extremely poor credit quality. | |
Ca | Obligations rated Ca are highly speculative and are likely in, or very near, default, with some prospect of recovery of principal and interest. | |
C | Obligations rated C are the lowest rated class of bonds and are typically in default, with little prospect for recovery of principal or interest. | |
NR | Not rated. | |
WR | Withdrawn rating. |
Note: Moody’s appends numerical modifiers 1, 2, and 3 to each generic rating classification from Aa through Caa. The modifier 1 indicates that the obligation ranks in the higher end of its generic rating category; the modifier 2 indicates a mid-range ranking; and the modifier 3 indicates a ranking in the lower end of that generic rating category. Percentage breakdown of the NR category includes Securities Lending Collateral.
49
SCHEDULE OF INVESTMENTS
At October 31, 2008
(all amounts except share amounts in thousands)
At October 31, 2008
(all amounts except share amounts in thousands)
Principal | Value | |||||||
U.S. GOVERNMENT AGENCY OBLIGATIONS (28.7%) | ||||||||
Fannie Mae | ||||||||
4.50%, due 03/25/2017 - 04/25/2030 | $ | 22,933 | $ | 22,760 | ||||
5.00%, due 10/25/2032 - 06/25/2034 | 19,556 | 19,297 | ||||||
5.50%, due 03/25/2026 | 8,945 | 8,979 | ||||||
5.92%, due 07/01/2037 * | 6,391 | 6,479 | ||||||
Freddie Mac | ||||||||
3.75%, due 12/15/2011 | 5,728 | 5,705 | ||||||
4.00%, due 10/15/2029 | 5,382 | 5,262 | ||||||
4.50%, due 02/15/2027 | 5,825 | 5,851 | ||||||
4.82%, due 06/01/2035 * | 9,427 | 9,388 | ||||||
5.00%, due 06/15/2027 - 11/15/2032 | 22,985 | 22,854 | ||||||
5.50%, due 04/15/2024 - 01/15/2029 | 13,767 | 13,948 | ||||||
5.51%, due 08/01/2037 * | 4,211 | 4,253 | ||||||
5.55%, due 02/01/2038 * | 6,586 | 6,628 | ||||||
5.71%, due 03/01/2037 * | 7,218 | 7,314 | ||||||
Ginnie Mae | ||||||||
4.50%, due 01/17/2033 | 6,343 | 6,329 | ||||||
Total U.S. Government Agency Obligations (cost $144,640) | 145,047 | |||||||
MORTGAGE-BACKED SECURITIES (3.6%) | ||||||||
Crown Castle Towers LLC | ||||||||
Series 2006-1A, Class C | ||||||||
5.47%, due 11/15/2036 -144A | 5,000 | 4,538 | ||||||
Global Signal Trust | ||||||||
Series 2004-2A, Class D | ||||||||
5.09%, due 12/15/2014 -144A | 9,750 | 9,309 | ||||||
SBA CMBS Trust | ||||||||
Series 2006-1A, Class E | ||||||||
6.17%, due 11/15/2036 -144A | 5,000 | 4,201 | ||||||
Total Mortgage-Backed Securities (cost $19,611) | 18,048 | |||||||
ASSET-BACKED SECURITIES (1.8%) | ||||||||
USAA Auto Owner Trust | ||||||||
Series 2007-2, Class A3 | ||||||||
4.90%, due 02/15/2012 | 4,000 | 3,939 | ||||||
Series 2008-2, Class A2 | ||||||||
3.91%, due 01/15/2011 | 5,000 | 4,962 | ||||||
Total Asset-Backed Securities (cost $8,999) | 8,901 | |||||||
CORPORATE DEBT SECURITIES (63.4%) | ||||||||
Aerospace & Defense (1.0%) | ||||||||
BAE Systems PLC | ||||||||
6.40%, due 12/15/2011 -144A | 5,000 | 5,154 | ||||||
Air Freight & Logistics (1.2%) | ||||||||
FedEx Corp. | ||||||||
3.50%, due 04/01/2009 ^ | 6,000 | 5,903 | ||||||
Airlines (0.6%) | ||||||||
Continental Airlines, Inc. | ||||||||
7.49%, due 10/02/2010 | 3,061 | 2,847 | ||||||
Automobiles (1.0%) | ||||||||
Daimler Finance North America LLC | ||||||||
7.20%, due 09/01/2009 | 5,200 | 4,827 | ||||||
Beverages (3.8%) | ||||||||
Coca-Cola Enterprises, Inc. | ||||||||
3.31%, due 05/06/2011 * | 6,000 | 5,793 | ||||||
Diageo Capital PLC | ||||||||
4.38%, due 05/03/2010 ^ | 4,870 | 4,820 | ||||||
Molson Coors Capital Finance | ||||||||
4.85%, due 09/22/2010 | 6,000 | 6,010 | ||||||
Sabmiller PLC | ||||||||
6.20%, due 07/01/2011 -144A | 2,301 | 2,337 | ||||||
Capital Markets (2.5%) | ||||||||
Merrill Lynch & Co., Inc. | ||||||||
4.61%, due 05/20/2009 * | 5,000 | 4,993 | ||||||
State Street Capital Trust III | ||||||||
8.25%, due 03/15/2011 Ž ◊ | 3,000 | 2,584 | ||||||
Xstrata Finance Dubai, Ltd. | ||||||||
3.15%, due 11/13/2009 -144A * | 5,000 | 4,910 | ||||||
Chemicals (2.2%) | ||||||||
ICI Wilmington, Inc. | ||||||||
4.38%, due 12/01/2008 | 5,002 | 5,001 | ||||||
Lubrizol Corp. | ||||||||
4.63%, due 10/01/2009 | 6,566 | 6,325 | ||||||
Commercial Banks (1.5%) | ||||||||
BNP Paribas | ||||||||
3.26%, due 06/04/2010 * | 3,700 | 3,702 | ||||||
M&I Marshall & Ilsley Bank | ||||||||
3.08%, due 12/04/2012 * | 5,390 | 4,208 | ||||||
Commercial Services & Supplies (0.5%) | ||||||||
Waste Management, Inc. | ||||||||
6.88%, due 05/15/2009 ^ | 2,355 | 2,371 | ||||||
Computers & Peripherals (1.0%) | ||||||||
Hewlett-Packard Co. | ||||||||
2.88%, due 06/15/2010 ^ * | 5,199 | 5,062 | ||||||
Consumer Finance (2.3%) | ||||||||
American Express Credit Corp. | ||||||||
3.38%, due 02/24/2012 ^ * | 4,300 | 3,094 | ||||||
Discover Financial Services | ||||||||
3.35%, due 06/11/2010 * | 6,920 | 4,915 | ||||||
John Deere Capital Corp. | ||||||||
3.57%, due 06/10/2011 * | 4,000 | 3,768 | ||||||
Containers & Packaging (0.6%) | ||||||||
Rexam PLC | ||||||||
6.75%, due 06/01/2013 -144A | 2,950 | 2,891 | ||||||
Diversified Financial Services (1.1%) | ||||||||
Caterpillar Financial Services Corp. | ||||||||
5.05%, due 12/01/2010 | 3,000 | 2,932 | ||||||
Pemex Finance, Ltd. | ||||||||
9.03%, due 02/15/2011 | 2,700 | 2,720 | ||||||
Diversified Telecommunication Services (3.6%) | ||||||||
Telecom Italia Capital SA | ||||||||
4.00%, due 11/15/2008 | 8,010 | 8,000 | ||||||
Telefonica Europe BV | ||||||||
7.75%, due 09/15/2010 | 5,400 | 5,228 | ||||||
Verizon Global Funding Corp. | ||||||||
7.25%, due 12/01/2010 | 5,000 | 4,985 | ||||||
Electric Utilities (2.1%) | ||||||||
PSEG Power LLC | ||||||||
3.75%, due 04/01/2009 | 4,900 | 4,818 | ||||||
Sempra Energy | ||||||||
7.95%, due 03/01/2010 | 5,500 | 5,530 | ||||||
Food & Staples Retailing (1.5%) | ||||||||
Kroger Co. | ||||||||
8.05%, due 02/01/2010 | 5,012 | 5,036 | ||||||
Stater Brothers Holdings, Inc. | ||||||||
8.13%, due 06/15/2012 | 2,900 | 2,581 | ||||||
Food Products (3.5%) | ||||||||
Cargill, Inc. | ||||||||
3.63%, due 03/04/2009 -144A | 5,000 | 4,928 | ||||||
ConAgra Foods, Inc. | ||||||||
7.88%, due 09/15/2010 | 4,880 | 4,856 | ||||||
General Mills, Inc. | ||||||||
4.19%, due 01/22/2010 * | 5,200 | 5,143 |
The notes to the financial statements are an integral part of this report.
50
Principal | Value | |||||||
Food Products (continued) | ||||||||
Michael Foods, Inc. | ||||||||
8.00%, due 11/15/2013 | $ | 3,215 | $ | 2,781 | ||||
Hotels, Restaurants & Leisure (0.5%) | ||||||||
Royal Caribbean Cruises, Ltd. | ||||||||
8.75%, due 02/02/2011 ^ | 3,000 | 2,580 | ||||||
Independent Power Producers & Energy Traders (1.9%) | ||||||||
Empresa Nacional de Electricidad SA | ||||||||
8.50%, due 04/01/2009 | 9,610 | 9,694 | ||||||
Industrial Conglomerates (1.2%) | ||||||||
Atmos Energy Corp. | ||||||||
4.00%, due 10/15/2009 | 1,840 | 1,735 | ||||||
Hutchison Whampoa International, Ltd. | ||||||||
5.45%, due 11/24/2010 -144A | 5,000 | 4,718 | ||||||
Insurance (0.3%) | ||||||||
Oil Insurance, Ltd. | ||||||||
7.56%, due 06/30/2011 -144A ■ Ž | 3,250 | 1,644 | ||||||
IT Services (1.1%) | ||||||||
Western Union Co. | ||||||||
5.40%, due 11/17/2011 ^ | 5,500 | 5,349 | ||||||
Machinery (0.5%) | ||||||||
Case New Holland, Inc. | ||||||||
6.00%, due 06/01/2009 ^ | 2,500 | 2,388 | ||||||
Media (3.8%) | ||||||||
British Sky Broadcasting Group PLC | ||||||||
8.20%, due 07/15/2009 | 6,000 | 5,947 | ||||||
Comcast Cable Communications LLC | ||||||||
6.88%, due 06/15/2009 | 5,500 | 5,455 | ||||||
Time Warner, Inc. | ||||||||
2.52%, due 11/13/2009 * | 4,906 | 4,612 | ||||||
Walt Disney Co. | ||||||||
4.71%, due 07/16/2010 * | 3,080 | 2,980 | ||||||
Metals & Mining (1.8%) | ||||||||
Arcelormittal | ||||||||
5.38%, due 06/01/2013 -144A | 3,500 | 2,844 | ||||||
BHP Billiton Finance, Ltd. | ||||||||
5.00%, due 12/15/2010 | 6,000 | 5,959 | ||||||
Multiline Retail (0.3%) | ||||||||
Target Corp. | ||||||||
2.63%, due 08/07/2009 * | 1,450 | 1,449 | ||||||
Office Electronics (0.8%) | ||||||||
Xerox Corp. | ||||||||
9.75%, due 01/15/2009 * | 4,000 | 3,985 | ||||||
Oil, Gas & Consumable Fuels (7.0%) | ||||||||
Anadarko Petroleum Corp. | ||||||||
3.22%, due 09/15/2009 * | 5,700 | 5,384 | ||||||
Burlington Resources Finance Co. | ||||||||
6.50%, due 12/01/2011 | 6,175 | 6,177 | ||||||
Enterprise Products Operating, LP | ||||||||
7.50%, due 02/01/2011 ^ | 6,100 | 6,030 | ||||||
Kinder Morgan Energy Partners, LP | ||||||||
6.30%, due 02/01/2009 | 3,200 | 3,188 | ||||||
Ras Laffan Liquefied Natural Gas Co., Ltd. | ||||||||
3.44%, due 09/15/2009 -144A | 4,039 | 3,988 | ||||||
Transcanada Pipelines, Ltd. | ||||||||
6.49%, due 01/21/2009 | 5,000 | 5,016 | ||||||
XTO Energy, Inc. | ||||||||
5.00%, due 08/01/2010 ^ | 5,770 | 5,674 | ||||||
Real Estate Investment Trusts (7.6%) | ||||||||
BRE Properties, Inc. | ||||||||
5.75%, due 09/01/2009 | 10,000 | 9,762 | ||||||
Developers Divers Realty | ||||||||
4.63%, due 08/01/2010 | 1,043 | 918 | ||||||
Federal Realty Investment Trust | ||||||||
8.75%, due 12/01/2009 | 2,680 | 2,706 | ||||||
Healthcare Realty Trust, Inc. | ||||||||
8.13%, due 05/01/2011 | 3,000 | 3,083 | ||||||
Kimco Realty Corp. | ||||||||
4.62%, due 05/06/2010 | 5,000 | 4,789 | ||||||
PPF Funding, Inc. | ||||||||
5.35%, due 04/15/2012 -144A | 4,000 | 3,772 | ||||||
ProLogis | ||||||||
5.25%, due 11/15/2010 ^ | 7,020 | 4,579 | ||||||
Simon Property Group, LP | ||||||||
3.75%, due 01/30/2009 | 5,335 | 5,270 | ||||||
Wea Finance LLC / WCI Finance LLC | ||||||||
5.40%, due 10/01/2012 -144A | 5,000 | 4,358 | ||||||
Real Estate Management & Development (1.4%) | ||||||||
Colonial Realty, LP | ||||||||
4.75%, due 02/01/2010 | 2,380 | 2,242 | ||||||
Post Apartment Homes, LP | ||||||||
7.70%, due 12/20/2010 ^ | 5,000 | 5,220 | ||||||
Road & Rail (4.2%) | ||||||||
Burlington Northern Santa Fe Corp. | ||||||||
6.13%, due 03/15/2009 | 5,000 | 4,995 | ||||||
Erac USA Finance Co. | ||||||||
7.95%, due 12/15/2009 -144A | 5,500 | 5,221 | ||||||
Norfolk Southern Corp. | ||||||||
6.20%, due 04/15/2009 | 6,000 | 5,979 | ||||||
Union Pacific Corp. | ||||||||
3.63%, due 06/01/2010 | 5,030 | 4,935 | ||||||
Wireless Telecommunication Services (1.0%) | ||||||||
Vodafone Group PLC | ||||||||
7.75%, due 02/15/2010 ^ | 5,000 | 4,861 | ||||||
Total Corporate Debt Securities (cost $339,994) | 320,539 | |||||||
Principal | ||||||||
REPURCHASE AGREEMENT (1.3%) | ||||||||
State Street Repurchase Agreement 0.15%, dated 10/31/2008, to be repurchased at $6,737 on 11/03/2008 ◊ • | 6,736 | 6,736 | ||||||
Total Repurchase Agreement (cost $6,736) | 6,736 | |||||||
Shares | ||||||||
SECURITIES LENDING COLLATERAL (3.4%) | ||||||||
State Street Navigator Securities Lending Trust - Prime Portfolio, 2.71% ◊ ▲ | 17,209,058 | 17,209 | ||||||
Total Securities Lending Collateral (cost $17,209) | 17,209 | |||||||
Total Investment Securities (cost $537,189) # | $ | 516,480 | ||||||
The notes to the financial statements are an integral part of this report.
51
FUTURES CONTRACTS:
Net Unrealized | ||||||||||||||||
Expiration | Appreciation | |||||||||||||||
Description | Contracts Г | Date | Amount | (Depreciation) | ||||||||||||
5-Year U.S. Note | (120 | ) | 12/31/2008 | $ | (13,591 | ) | $ | (160 | ) | |||||||
$ | (13,591 | ) | $ | (160 | ) | |||||||||||
NOTES TO SCHEDULE OF INVESTMENTS: | ||
* | Floating or variable rate note. Rate is listed as of 10/31/2008. | |
^ | All or a portion of this security is on loan. The value of all securities on loan is $16,847. | |
Ž | The security has a perpetual maturity. The date shown is the next call date. | |
Г | Contract amounts are not in thousands. | |
■ | Coupon rate is fixed for a predetermined period of time and then converts to a floating rate until maturity/call date. Rate is listed as of 10/31/2008. | |
• | Repurchase agreement is collateralized by U.S. Government Agency Obligations with interest rates ranging from 5.00% to 5.89%, maturity dates ranging between 12/01/2019 — 01/01/2037, and with market values plus accrued interests of $6,871. | |
◊ | State Street Bank & Trust Company serves as the accounting, custody, and lending agent for the Fund and provides various services on behalf of the Fund. | |
▲ | Interest rate shown reflects the yield at 10/31/2008. | |
# | Aggregate cost for federal income tax purposes is $537,272. Aggregate gross unrealized appreciation/depreciation for all securities in which there is an excess of value over tax cost were $1,089 and $21,881, respectively. Net unrealized depreciation for tax purposes is $20,792. | |
DEFINITIONS: | ||
144A | 144A Securities are registered pursuant to Rule 144A of the Securities Act of 1933. These securities are deemed to be liquid for purposes of compliance limitations on holdings of illiquid securities and may be resold as transactions exempt from registration, normally to qualified institutional buyers. At 10/31/2008, these securities aggregated $64,813, or 12.83% of the Fund’s net assets. | |
LLC | Limited Liability Company | |
LP | Limited Partnership | |
PLC | Public Limited Company |
The notes to the financial statements are an integral part of this report.
52
Transamerica Small/Mid Cap Value
(unaudited)
(unaudited)
MARKET ENVIRONMENT
Faced with many challenges in the twelve months ended October 31, 2008, US equity indices delivered double-digit negative returns across the board. The Russell 2500® Value Index (“Russell 2500 Value”) declined 33.64%.
Throughout the period, problems plaguing the housing market continued, while commodity prices first soared then plummeted. Meanwhile, what began as concerns about securities related to defaulting sub-prime mortgages escalated into a variety of increasingly severe crises in the markets where banks lend to each other and to businesses, causing extreme disruption in both US and foreign financial markets. As the problems multiplied, financial institutions tightened their lending standards. This made it more difficult for companies to fund payroll, inventory and other near-term expenses in the face of high borrowing costs. Consumers, already feeling the effects of higher energy and food prices, rising unemployment and lack of wage growth, also found it more difficult to borrow. Although the Federal Reserve Board (“Fed”) and the US government intervened to restore confidence in the financial systems, the US headed toward recession and expectations of a global economic slowdown rose.
PERFORMANCE
For the year ended October 31, 2008, Transamerica Small/Mid Cap Value Class A returned (39.47)%. By comparison, its benchmark, the Russell 2500® Value, returned (33.64)%.
STRATEGY REVIEW
The results reflect the impact of decisions made by the portfolio’s prior management team (through September 30, 2008) and decisions of a new management team thereafter.The portfolio’s underperformance can be attributed almost exclusively to overweighting energy and shipping-related stocks. As the financial crisis and economic turmoil increasingly spread across the globe, investors shunned the stocks over concerns that the global supply-demand ratios driving their growth will deteriorate temporarily, due to recession. The largest individual detractors from relative performance (versus the benchmark) included Aegean Marine Petroleum Network Inc., DryShips Inc., Genco Shipping & Trading Limited and McDermott International, Inc., an oil services company.
Management of the portfolio was transferred to a new team at Transamerica Investment Management, LLC as of October 1, 2008. The new team began repositioning the portfolio to be more diversified by sector and industry while keeping it relatively concentrated in 35 — 45 names. In selecting stocks to replace the energy, shipping and other stocks vulnerable to the slowing global economy, we focused on companies that derive more of their revenues from US sources. We believe that since the US was first to take action to stave off recession, it also will emerge from the economic downturn before others do.
While the new investment team believes that, in the long run, global economic growth will be strong, it also recognized that, in the near term, the financial crisis will greatly limit economic expansion. With that in mind, we (the new team) began partially and gradually repositioning the portfolio to be more diversified by sector and industry while maintaining a relatively concentrated portfolio.
Partially offsetting these declines were our selections in the producer durables and consumer discretionary (e.g., FTI Consulting, Inc. (“FTI Consulting”)) sectors and our cash position. FTI Consulting, a provider of advice on corporate governance, compliance and other strategic management issues, saw strong worldwide sales and benefited from distressed companies seeking its services in troubled times. Although our goal is to be fully invested at all times as market conditions worsened, we let our cash position build temporarily during October. Because cash outperformed stocks, this added to performance. It also made it possible to invest in new opportunities at very attractive prices as the market fell during that month.
We believe a consumer-driven recession has already arrived. We believe the federal government’s $700-billion rescue of the financial services sector should provide some much-needed rationality in the markets. We believe it should help to rebuild trust among financial institutions and reduce the severity of the recession. In the interim, high levels of market volatility likely will persist.
Joshua D. Shaskan, CFA
Scott L. Dinsdale, CFA
Jeffrey J. Hoo, CFA
John D. Lawrence, CFA
Scott L. Dinsdale, CFA
Jeffrey J. Hoo, CFA
John D. Lawrence, CFA
Co-Portfolio Managers
Transamerica Investment Management, LLC
Transamerica Investment Management, LLC
Prior to October 1, 2008, Michelle E. Stevens was the portfolio manager of the fund.
53
![(LINE GRAPH)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025736.gif)
Average Annual Total Return for Periods Ended 10/31/2008
From | Inception | |||||||||||||||
1 Year | 5 Years | Inception | Date | |||||||||||||
Class A (NAV) | (39.47) | % | 6.54 | % | 7.87 | % | 4/2/01 | |||||||||
Class A (POP) | (42.79) | % | 5.34 | % | 7.07 | % | 4/2/01 | |||||||||
Russell 2500 Value (1) | (33.64) | % | 2.55 | % | 5.80 | % | 4/2/01 | |||||||||
Class B (NAV) | (39.85) | % | 5.79 | % | 7.14 | % | 4/2/01 | |||||||||
Class B (POP) | (42.51) | % | 5.64 | % | 7.14 | % | 4/2/01 | |||||||||
Class C (NAV) | (39.84) | % | 5.78 | % | 11.06 | % | 11/11/02 | |||||||||
Class C (POP) | (40.37) | % | 5.78 | % | 11.06 | % | 11/11/02 | |||||||||
Class I (NAV) | (39.11) | % | N/A | (1.70 | )% | 11/15/05 |
NOTES | ||
(1) | The Russell 2500 Value Index is an unmanaged index used as a general measure of market performance. Calculations assume dividends and capital gains are reinvested and do not include any managerial expenses. You cannot directly invest in an index. |
The performance data presented represents past performance; future results may vary. Performance data does not reflect the deduction of taxes that would be paid on fund distributions or the redemption of fund shares. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than performance quoted. Please see www.transamericafunds.com for performance data current to the most recent month-end. Public Offering Price (POP) returns include the reinvestment of dividends and capital gains and reflect the maximum sales charge of 5.5% for A shares or the maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 6 years) for Class B shares and 1% (during the first 12 months) for Class C shares. Shares purchased prior to March 1, 2004 are subject to a maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 7 years) for Class B shares and (2% in the 1st year, decreasing to 0% after 2 years) for Class C shares. Net Asset Value (NAV) returns include the reinvestment of dividends and capital gains but do not reflect any sales charges.
Investing in small cap stocks generally involves greater risk and volatility, therefore an investment in the fund may not be appropriate for everyone. This material must be preceded or accompanied by a current prospectus, which includes specific contents regarding the investment objectives and policies of this Fund.
54
UNDERSTANDING YOUR FUND’S EXPENSES
(unaudited)
(unaudited)
SHAREHOLDER EXPENSES
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, contingent deferred sales charges on redemptions and redemption fees; and (2) ongoing costs, including management fees, 12b-1 distribution and service fees, and other fund expenses.
The following Example is intended to help you understand your ongoing costs (in dollars and cents) of investing in the Fund and to compare these costs with the ongoing costs of investing in other funds.
The Example is based on an investment of $1,000 invested at May 1, 2008 and held for the entire period until October 31, 2008.
ACTUAL EXPENSES
The first line in the table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line of your Fund under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. If your account is an IRA, your expenses could have included a $15 annual fee. The amount of any fee paid through your account would increase the estimate of expenses you paid during the period and decrease your ending account value.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line in the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. As in the case of the actual expense example, if your account is subject to an IRA fee, the amount of the fee paid through your account would increase the hypothetical expenses you would have paid during the period and decrease the hypothetical ending account value.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges, redemption fees, brokerage commissions paid on purchases and sales of fund shares. Therefore, the second line under the Fund in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. If any of these transaction costs were included, your costs would be higher. The expenses shown in the table do not reflect any fees that may be charged to you by brokers, financial intermediaries or other financial institutions.
Beginning | Ending | Annualized | Expenses | |||||||||||||
Account | Account | Expense | Paid During | |||||||||||||
Value | Value | Ratio | Period (a) | |||||||||||||
Class A | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 661.11 | 1.43 | % | $ | 5.97 | ||||||||
Hypothetical (b) | 1,000.00 | 1,017.95 | 1.43 | 7.25 | ||||||||||||
Class B | ||||||||||||||||
Actual | 1,000.00 | 659.27 | 2.09 | 8.72 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,014.63 | 2.09 | 10.58 | ||||||||||||
Class C | ||||||||||||||||
Actual | 1,000.00 | 659.40 | 2.06 | 8.59 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,014.78 | 2.06 | 10.43 | ||||||||||||
Class I | ||||||||||||||||
Actual | 1,000.00 | 663.39 | 0.85 | 3.55 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,020.86 | 0.85 | 4.32 |
(a) | Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days), and divided by the number of days in the year (366 days). | |
(b) | 5% return per year before expenses. |
GRAPHICAL PRESENTATION OF SCHEDULE OF INVESTMENTS
By Sector
At October 31, 2008
(unaudited)
By Sector
At October 31, 2008
(unaudited)
![(PIE CHART)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025737.gif)
This chart shows the percentage breakdown by Sector of the Fund’s total investment securities. Percentage breakdown of the Short-term category includes Securities Lending Collateral.
55
SCHEDULE OF INVESTMENTS
At October 31, 2008
(all amounts except share amounts in thousands)
At October 31, 2008
(all amounts except share amounts in thousands)
Shares | Value | |||||||
COMMON STOCKS (86.1%) | ||||||||
Aerospace & Defense (0.5%) | ||||||||
Alliant Techsystems, Inc. ‡ | 30,830 | $ | 2,545 | |||||
Auto Components (1.8%) | ||||||||
Tenneco, Inc. ‡ ^ | 2,024,220 | 9,939 | ||||||
Chemicals (3.6%) | ||||||||
Terra Industries, Inc. ^ | 601,001 | 13,216 | ||||||
Zep, Inc. | 299,805 | 6,311 | ||||||
Commercial Banks (1.2%) | ||||||||
Wintrust Financial Corp. ^ | 246,115 | 6,301 | ||||||
Commercial Services & Supplies (2.7%) | ||||||||
Republic Services, Inc. -Class A ^ | 624,090 | 14,791 | ||||||
Communications Equipment (4.4%) | ||||||||
Arris Group, Inc. ‡ ^ | 1,982,000 | 13,696 | ||||||
Harmonic Lightwaves, Inc. ‡ ^ | 1,472,832 | 10,472 | ||||||
Computers & Peripherals (0.2%) | ||||||||
Hypercom Corp. ‡ ^ | 434,321 | 847 | ||||||
Electric Utilities (3.4%) | ||||||||
Uil Holdings Corp. ^ | 550,000 | 18,150 | ||||||
Electronic Equipment & Instruments (1.1%) | ||||||||
Cogent, Inc. ‡ ^ | 655,735 | 5,993 | ||||||
Energy Equipment & Services (3.7%) | ||||||||
Superior Energy Services, Inc. ‡ ^ | 935,000 | 19,934 | ||||||
Food Products (3.9%) | ||||||||
Dean Foods Co. ‡ ^ | 977,630 | 21,371 | ||||||
Health Care Technology (1.1%) | ||||||||
Allscripts-Misys Healthcare Solutions, Inc. ^ | 902,639 | 5,867 | ||||||
Hotels, Restaurants & Leisure (2.5%) | ||||||||
PF Chang’s China Bistro, Inc. ‡ ^ | 663,000 | 13,565 | ||||||
Household Durables (1.9%) | ||||||||
Jarden Corp. ‡ ^ | 575,100 | 10,237 | ||||||
Insurance (7.1%) | ||||||||
HCC Insurance Holdings, Inc. ^ | 872,500 | 19,247 | ||||||
PartnerRe, Ltd. ^ | 280,000 | 18,953 | ||||||
Internet Software & Services (2.4%) | ||||||||
Valueclick, Inc. ‡ ^ | 1,768,308 | 13,085 | ||||||
IT Services (1.7%) | ||||||||
NeuStar, Inc. -Class A ‡ | 44,986 | 886 | ||||||
Wright Express Corp. ‡ ^ | 605,000 | 8,282 | ||||||
Life Sciences Tools & Services (2.5%) | ||||||||
Varian, Inc. ‡ ^ | 365,000 | 13,450 | ||||||
Marine (0.2%) | ||||||||
Omega Navigation Enterprises, Inc. -Class A^ | 225,342 | 1,257 | ||||||
Oil, Gas & Consumable Fuels (7.1%) | ||||||||
Comstock Resources, Inc. ‡ ^ | 301,085 | 14,880 | ||||||
PetroHawk Energy Corp. ‡ ^ | 965,700 | 18,300 | ||||||
StealthGas, Inc. ^ | 682,685 | 4,711 | ||||||
Personal Products (1.1%) | ||||||||
Bare Escentuals, Inc. ‡ ^ | 1,483,185 | 6,200 | ||||||
Pharmaceuticals (1.6%) | ||||||||
Sepracor, Inc. ‡ ^ | 646,225 | 8,608 | ||||||
Professional Services (5.9%) | ||||||||
FTI Consulting, Inc. ‡ ^ | 550,000 | 32,037 | ||||||
Real Estate Investment Trusts (18.5%) | ||||||||
Annaly Capital Management, Inc. ^ | 1,880,000 | 26,132 | ||||||
Capstead Mortgage Corp. ^ | 1,098,500 | 11,040 | ||||||
Host Hotels & Resorts, Inc. ^ | 1,243,820 | 12,861 | ||||||
LTC Properties, Inc. ^ | 800,480 | 19,348 | ||||||
Omega Healthcare Investors, Inc. ^ | 1,169,860 | 17,630 | ||||||
Potlatch Corp. ^ | 395,335 | 13,129 | ||||||
Software (3.4%) | ||||||||
Fair Isaac Corp. ^ | 465,000 | 7,249 | ||||||
Macrovision Solutions Corp. ‡ ^ | 1,030,000 | 11,412 | ||||||
Textiles, Apparel & Luxury Goods (2.6%) | ||||||||
Hanesbrands, Inc. ‡ ^ | 809,960 | 14,150 | ||||||
Total Common Stocks (cost $533,709) | 466,082 | |||||||
Principal | ||||||||
REPURCHASE AGREEMENT (11.7%) | ||||||||
State Street Repurchase Agreement 0.15%, dated 10/31/2008, to be repurchased at $63,351 on 11/03/2008 ◊ • | $ | 63,351 | 63,351 | |||||
Total Repurchase Agreement (cost $63,351) | 63,351 | |||||||
Shares | ||||||||
SECURITIES LENDING COLLATERAL (24.4%) | ||||||||
State Street Navigator Securities Lending Trust - Prime Portfolio, 2.71% ◊▲ | 131,869,568 | 131,870 | ||||||
Total Securities Lending Collateral (cost $131,870) | 131,870 | |||||||
Total Investment Securities (cost $728,930) # | $ | 661,303 | ||||||
NOTES TO SCHEDULE OF INVESTMENTS: | ||
‡ | Non-income producing security. | |
^ | All or a portion of this security is on loan. The value of all securities on loan is $127,833. | |
• | Repurchase agreement is collateralized by a U.S. Government Obligation with an interest rate of 0.00%, and a maturity date of 01/15/2009, and with a market value plus accrued interest of $64,618. | |
◊ | State Street Bank & Trust Company serves as the accounting, custody, and lending agent for the Fund and provides various services on behalf of the Fund. | |
▲ | Interest rate shown reflects the yield at 10/31/2008. | |
# | Aggregate cost for federal income tax purposes is $728,939. Aggregate gross unrealized appreciation/depreciation for all securities in which there is an excess of value over tax cost were $37,498 and $105,134, respectively. Net unrealized depreciation for tax purposes is $67,636. |
The notes to the financial statements are an integral part of this report.
56
Transamerica Templeton Global
(unaudited)
(unaudited)
MARKET ENVIRONMENT
Transamerica Investment Management, LLC:
Faced with many challenges in the twelve months ended October 31, 2008, US equity indices delivered double-digit negative returns across the board. The Russell 1000® Growth Index declined 36.95%.
Throughout the period, problems plaguing the housing market continued, while commodity prices first soared then plummeted. Meanwhile, what began as concerns about securities related to defaulting sub-prime mortgages escalated into a variety of increasingly severe crises in the markets where banks lend to each other and to businesses, causing extreme disruption in both US and foreign financial markets. As the problems multiplied, financial institutions tightened their lending standards. This made it more difficult for companies to fund payroll, inventory and other near-term expenses in the face of high borrowing costs. Consumers, who already were feeling the effects of high energy prices, increasing food costs, rising unemployment and lack of wage growth, also found it more difficult to borrow. Although the Federal Reserve Board (“Fed”) and the US government intervened to restore confidence in the financial systems, the US headed toward recession and expectations of a global economic slowdown rose.
Templeton Investment Counsel, LLC:
During the twelve months ended October 31, 2008, US gross domestic product (“GDP”) growth slowed markedly as housing prices declined, consumer demand softened, and a credit crisis originally related to US sub-prime loan losses intensified and spread globally. Recessionary fears spanned the entire period, and by summer most economists agreed a recession was under way, and a global slowdown surfaced.
Strong global demand triggered a commodity price boom, which added to global inflationary pressures. Seeking to reignite the US economy, the Fed lowered rates to 1.00% from 4.50%. The eurozone focused on controlling inflation and kept rates steady at 4.00% until July when the European Central Bank (“ECB”) joined many of the world’s central banks and raised rates. The potential for global recession, however, exacerbated by the virtual freeze in the global financial system in September and October, trumped inflationary concerns, and the world’s monetary authorities cut interest rates aggressively. The US dollar, which had previously declined versus many of the world’s currencies, regained ground quickly toward period-end, and the dollar posted twelve-month gains relative to most currencies.
Against this challenging economic backdrop, many global equity markets were volatile, and virtually all local indices suffered losses for the twelve-month period. Despite negative economic data and an outlook for decelerating corporate earnings and profit margins globally, many companies’ balance sheets, primarily outside the financial sector, remained relatively strong.
PERFORMANCE
For the year ended October 31, 2008, Transamerica Templeton Global Class A returned (44.68)%. By comparison, its benchmark, the Morgan Stanley Capital International World Index (“MSCIW”), returned (41.51)%.
STRATEGY REVIEW
Transamerica Investment Management LLC:
The portfolio lagged the index due primarily to poor results for our holdings within the automotive/transportation (e.g., Daimler AG (“Daimler”)), technology (e.g., Research In Motion Limited (“RIMM”)), and consumer discretionary (e.g., MGM Mirage (“MGM”)) sectors. Daimler suffered during the year as a result of the downward trend in automotive sales worldwide, a trend that was heightened by consumers’ difficulty in obtaining financing. We believe RIMM’s performance can be attributed to the concerns of slowing consumer spending rather than to any deterioration in company fundamentals. We sold our position in MGM in early 2008, based on our belief that discretionary spending on travel and entertainment would slow.
Partially offsetting these declines were our selections in materials/processing (e.g., Praxair, Inc. (“Praxair”)) and healthcare (e.g., Gilead Sciences, Inc. (“Gilead”)) and our cash position. Praxair, a producer and distributor of industrial gases, held up relatively well because its stable business model emphasizes long-term contracts. We believe this will help the company maintain its already strong market share. Gilead, a biopharmaceutical company working on treatments for cures to life-threatening diseases, has benefited from competitors’ mergers, which reduced its competition. Our goal is to be fully invested at all times, and cash has historically averaged less than 5% of portfolio assets. However, as market conditions worsened, we let our cash position build slightly so that we could redeploy the assets in attractive new opportunities as they arose.
We believe a consumer-driven recession has already arrived. We believe the federal government’s $700-billion rescue of the financial services sector, the biggest government intervention in the financial system since the 1930s, should provide some much-needed rationality in the markets.
We believe it should help to rebuild trust among financial institutions and serve to shorten or at least reduce the severity of the recession. In the interim, high levels of market volatility likely will persist.
Templeton Investment Counsel, LLC:
Overall, investments in every country represented in the portfolio, with the exception of Mexico (not an index component), fell in value during the year under review, as did every country represented in the index. Geographically, the portfolio’s Asian and Latin American equities hindered performance in absolute terms and relative to the benchmark for the reporting period. Stock selection in Japan hurt relative performance, as did the portfolio’s holdings in Brazil (not an index component). In Europe, overweightings and stock selection in Norway and the Netherlands, and our underweighting and stock selection in Switzerland, also hindered relative performance.
During this difficult year for equities, every sector experienced declines in value. Utilities were a major detractor from performance relative to the benchmark, due to our underweighting and stock selection. Among utilities, E.ON AG (Germany) and Korea Electric Power Corporation (South Korea) posted steep share price declines.
57
The financials sector suffered heavy losses and hurt portfolio performance on an absolute basis. Key underperformers included Japanese lender Aiful Corporation, Netherlands-based ING Groep N.V., and French insurer AXA. Underweighting in consumer staples and stock selection in the consumer discretionary sector weighed on absolute and relative performance, particularly, automotive manufacturer Bayerische Motoren Werke AG (“BMW”) (Germany) and food and staples retailer The Jean Coutu Group (PJC) Inc. (Canada).
Geographically, our North American equities benefited the portfolio’s performance in relative terms, largely due to stock selection. Our overweighted allocation to the Middle East and Africa (composed solely of investments in non-index South Africa and Israel) also helped relative results. By country, stock selection in France and the United Kingdom (“UK”) contributed to relative performance, aided by an underweighted position in Australia. Stock selection and an underweighting in Ireland also aided relative results.
In regard to sectors, industries and individual securities, the portfolio showed strength relative to the benchmark in several areas. Although financials stocks hurt the portfolio in absolute terms, our underweighting versus the benchmark was beneficial in relative terms. Based on stock selection, ACE Limited, Munich RE AG, HSBC Holdings plc and Promise Co., Ltd. performed well on a relative basis. The materials sector was another major positive contributor to performance relative to the benchmark, due to our underweighted allocation and stock selection. Our underweighted position in metals and mining companies aided relative results, as most share prices fell precipitously in the latter half of the fiscal year when related commodity prices plummeted. Driven by stock selection, the energy sector also helped relative performance for the period. Top contributors included UK-based oil and gas conglomerate BP plc. and Italy’s Eni SpA.
Our overweighted position in the health care sector also lifted the portfolio’s relative returns, aided by holdings in pharmaceutical manufacturers such as Swiss firm Novartis AG (not an index component), French company Sanofi-Aventis and UK giant GlaxoSmithKline plc, which each declined less than the overall index.
The US dollar appreciated versus most foreign currencies for the period, which negatively affected the portfolio’s performance because investments in securities with non-US currency exposure lost value as the dollar strengthened.
Gary U. Rollé, CFA
Portfolio Manager
Transamerica Investment Management, LLC
Transamerica Investment Management, LLC
Tina Sadler, CFA
Antonio T. Docal, CFA
Gary Motyl, CFA
Antonio T. Docal, CFA
Gary Motyl, CFA
Co-Portfolio Managers
Templeton Investment Counsel, LLC
Templeton Investment Counsel, LLC
58
![(LINE GRAPH)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025738.gif)
Average Annual Total Return for Periods Ended 10/31/2008
From | Inception | |||||||||||||||||||
1 Year | 5 Years | 10 Years | Inception | Date | ||||||||||||||||
Class A (NAV) | (44.68 | )% | (1.12 | )% | (0.79 | )% | 6.84 | % | 10/1/92 | |||||||||||
Class A (POP) | (47.73 | )% | (2.23 | )% | (1.35 | )% | 6.47 | % | 10/1/92 | |||||||||||
MSCI World (USD)(1) | (41.51 | )% | 2.24 | % | 1.21 | % | 6.23 | % | 10/1/92 | |||||||||||
Class B (NAV) | (44.99 | )% | (1.76 | )% | (1.32 | )% | 3.22 | % | 10/1/95 | |||||||||||
Class B (POP) | (47.73 | )% | (1.95 | )% | (1.32 | )% | 3.22 | % | 10/1/95 | |||||||||||
Class C (NAV) | (45.05 | )% | (1.80 | )% | N/A | 0.46 | % | 11/11/02 | ||||||||||||
Class C (POP) | (45.59 | )% | (1.80 | )% | N/A | 0.46 | % | 11/11/02 |
NOTES | ||
(1) | The MSCI World (USD) is an unmanaged index used as a general measure of market performance. Calculations assume dividends and capital gains are reinvested and do not include any managerial expenses. You cannot directly invest in an index. |
The performance data presented represents past performance; future results may vary. Performance data does not reflect the deduction of taxes that would be paid on fund distributions or the redemption of fund shares. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than performance quoted. Please see www.transamericafunds.com for performance data current to the most recent month-end. Public Offering Price (POP) returns include the reinvestment of dividends and capital gains and reflect the maximum sales charge of 5.5% for A shares or the maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 6 years) for Class B shares and 1% (during the first 12 months) for Class C shares. Shares purchased prior to March 1, 2004 are subject to a maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 7 years) for Class B shares and (2% in the 1st year, decreasing to 0% after 2 years) for Class C shares. Net Asset Value (NAV) returns include the reinvestment of dividends and capital gains but do not reflect any sales charges.
International investing involves special risks including currency fluctuations, political instability, and different financial accounting standards. This material must be preceded or accompanied by a current prospectus, which includes specific contents regarding the investment objectives and policies of this Fund.
59
UNDERSTANDING YOUR FUND’S EXPENSES
(unaudited)
(unaudited)
SHAREHOLDER EXPENSES
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, contingent deferred sales charges on redemptions and redemption fees; and (2) ongoing costs, including management fees, 12b-1 distribution and service fees, and other fund expenses.
The following Example is intended to help you understand your ongoing costs (in dollars and cents) of investing in the Fund and to compare these costs with the ongoing costs of investing in other funds.
The Example is based on an investment of $1,000 invested at May 1, 2008 and held for the entire period until October 31, 2008.
ACTUAL EXPENSES
The first line in the table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line of your Fund under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. If your account is an IRA, your expenses could have included a $15 annual fee. The amount of any fee paid through your account would increase the estimate of expenses you paid during the period and decrease your ending account value.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line in the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. As in the case of the actual expense example, if your account is subject to an IRA fee, the amount of the fee paid through your account would increase the hypothetical expenses you would have paid during the period and decrease the hypothetical ending account value.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges, redemption fees, brokerage commissions paid on purchases and sales of fund shares. Therefore, the second line under the Fund in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. If any of these transaction costs were included, your costs would be higher. The expenses shown in the table do not reflect any fees that may be charged to you by brokers, financial intermediaries or other financial institutions.
Beginning | Ending | Annualized | Expenses | |||||||||||||
Account | Account | Expense | Paid During | |||||||||||||
Value | Value | Ratio | Period (a) | |||||||||||||
Class A | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 618.66 | 1.55 | % | $ | 6.31 | ||||||||
Hypothetical (b) | 1,000.00 | 1,017.34 | 1.55 | 7.86 | ||||||||||||
Class B | ||||||||||||||||
Actual | 1,000.00 | 617.38 | 2.20 | 8.94 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,014.08 | 2.20 | 11.14 | ||||||||||||
Class C | ||||||||||||||||
Actual | 1,000.00 | 616.81 | 2.20 | 8.94 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,014.08 | 2.20 | 11.14 |
(a) | Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days), and divided by the number of days in the year (366 days). | |
(b) | 5% return per year before expenses. |
GRAPHICAL PRESENTATION OF SCHEDULE OF INVESTMENTS
By Region
At October 31, 2008
(unaudited)
By Region
At October 31, 2008
(unaudited)
![(PIE CHART)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025739.gif)
This chart shows the percentage breakdown by Region of the Fund’s total investment securities. Percentage breakdown of the Short-term category includes Securities Lending Collateral.
60
SCHEDULE OF INVESTMENTS
At October 31, 2008
(all amounts except share amounts in thousands)
At October 31, 2008
(all amounts except share amounts in thousands)
Shares | Value | |||||||
COMMON STOCKS (94.7%) | ||||||||
Australia (0.7%) | ||||||||
Alumina, Ltd. | 96,049 | $ | 137 | |||||
National Australia Bank, Ltd. ^ | 34,025 | 552 | ||||||
Austria (0.5%) | ||||||||
Telekom Austria AG | 41,880 | 515 | ||||||
Brazil (1.2%) | ||||||||
Cia Vale do Rio Doce -Class B ADR ^ | 15,230 | 200 | ||||||
Empresa Brasileira de Aeronautica SA ADR ^ | 25,360 | 531 | ||||||
Petroleo Brasileiro SA ADR | 18,000 | 484 | ||||||
Canada (0.5%) | ||||||||
Research In Motion, Ltd. ‡ | 9,000 | 454 | ||||||
Denmark (0.3%) | ||||||||
Vestas Wind Systems ‡ | 6,730 | 276 | ||||||
Finland (0.6%) | ||||||||
Stora Enso OYJ -Class R | 35,580 | 331 | ||||||
UPM-Kymmene OYJ | 21,310 | 301 | ||||||
France (6.9%) | ||||||||
Accor SA ^ | 7,040 | 274 | ||||||
AXA SA | 36,800 | 703 | ||||||
France Telecom SA | 57,970 | 1,462 | ||||||
Gdf Suez | 14,448 | 643 | ||||||
Michelin -Class B | 10,407 | 536 | ||||||
Sanofi-Aventis SA | 20,199 | 1,280 | ||||||
Suez SA | 14 | 1 | ||||||
Total SA | 21,742 | 1,196 | ||||||
Vivendi | 26,410 | 690 | ||||||
Germany (6.0%) | ||||||||
Bayerische Motoren Werke AG | 21,040 | 534 | ||||||
Celesio AG | 19,660 | 578 | ||||||
Daimler AG | 26,000 | 897 | ||||||
Deutsche Post AG | 42,130 | 462 | ||||||
E.ON AG ADR | 24,540 | 933 | ||||||
Infineon Technologies AG ‡ ^ | 115,570 | 358 | ||||||
Merck KGAA | 6,870 | 607 | ||||||
Muenchener Rueckversicherungs AG | 4,810 | 624 | ||||||
SAP AG | 9,550 | 334 | ||||||
Siemens AG | 11,760 | 692 | ||||||
Hong Kong (0.8%) | ||||||||
Cheung Kong Holdings, Ltd. | 47,000 | 451 | ||||||
Hutchison Whampoa, Ltd. | 59,000 | 319 | ||||||
Ireland (0.3%) | ||||||||
CRH PLC | 14,310 | 315 | ||||||
Israel (0.7%) | ||||||||
Check Point Software Technologies ‡ ^ | 33,970 | 687 | ||||||
Italy (1.7%) | ||||||||
Autogrill SpA ^ | 32,781 | 262 | ||||||
ENI SpA ADR | 19,755 | 949 | ||||||
UniCredit SpA | 173,709 | 425 | ||||||
Japan (4.6%) | ||||||||
Fujifilm Holdings Corp. | 16,700 | 384 | ||||||
Konica Minolta Holdings, Inc. | 54,500 | 358 | ||||||
Mabuchi Motor Co., Ltd. ^ | 12,400 | 490 | ||||||
Mitsubishi UFJ Financial Group, Inc. ADR ^ | 32,270 | 202 | ||||||
Nintendo Co., Ltd. | 2,200 | 707 | ||||||
Olympus Corp. ^ | 17,800 | 343 | ||||||
Promise Co., Ltd. ^ | 26,150 | 469 | ||||||
Sony Corp. ADR | 10,560 | 245 | ||||||
Takeda Pharmaceutical Co., Ltd. | 8,300 | 412 | ||||||
Toyota Motor Corp. | 13,100 | 512 | ||||||
USS Co., Ltd. | 8,270 | 507 | ||||||
Korea, Republic of (1.4%) | ||||||||
KB Financial Group, Inc. ADR ‡ ^ | 8,150 | 201 | ||||||
Korea Electric Power Corp. ADR ^ | 21,480 | 213 | ||||||
Samsung Electronics Co., Ltd. -144A GDR | 4,830 | 994 | ||||||
Netherlands (1.6%) | ||||||||
ING Groep NV | 32,710 | 307 | ||||||
ING Groep NV ADR ^ | 9,330 | 87 | ||||||
Koninklijke Philips Electronics NV ^ | 33,360 | 616 | ||||||
Randstad Holding NV ^ | 12,460 | 242 | ||||||
Reed Elsevier NV | 26,984 | 361 | ||||||
Netherlands Antilles (0.9%) | ||||||||
Schlumberger, Ltd. ^ | 16,400 | 847 | ||||||
Norway (0.6%) | ||||||||
Aker Kvaerner ASA | 17,210 | 94 | ||||||
Telenor ASA | 88,850 | 530 | ||||||
Singapore (1.7%) | ||||||||
DBS Group Holdings, Ltd. | 85,600 | 653 | ||||||
DBS Group Holdings, Ltd. ADR ^ | 4,010 | 121 | ||||||
Flextronics International, Ltd. ‡ ^ | 61,830 | 258 | ||||||
Singapore Telecommunications, Ltd. | 378,000 | 636 | ||||||
South Africa (0.5%) | ||||||||
Sasol, Ltd. ADR ^ | 16,850 | 487 | ||||||
Spain (1.8%) | ||||||||
Banco Santander SA ^ | 25,719 | 278 | ||||||
Telefonica SA ^ | 78,161 | 1,447 | ||||||
Sweden (0.9%) | ||||||||
Nordea Bank AB | 67,010 | 553 | ||||||
Securitas AB -Class B | 25,750 | 247 | ||||||
Switzerland (5.3%) | ||||||||
ACE, Ltd. ^ | 18,590 | 1,066 | ||||||
Adecco SA | 12,770 | 444 | ||||||
Lonza Group AG | 7,370 | 612 | ||||||
Nestle SA ADR | 30,275 | 1,164 | ||||||
Novartis AG ADR | 22,670 | 1,156 | ||||||
Swiss Reinsurance ^ | 11,470 | 478 | ||||||
UBS AG | 17,015 | 289 | ||||||
Taiwan (1.3%) | ||||||||
Chunghwa Telecom Co., Ltd. ADR | 35,258 | 580 | ||||||
Lite-On Technology Corp. GDR | 30,713 | 196 | ||||||
Taiwan Semiconductor Manufacturing Co., Ltd. ADR ^ | 62,781 | 519 | ||||||
Turkey (0.6%) | ||||||||
Turkcell Iletisim Hizmet AS ADR ^ | 47,270 | 580 | ||||||
United Kingdom (11.1%) | ||||||||
Aviva PLC | 92,990 | 555 | ||||||
BAE Systems PLC | 112,160 | 630 | ||||||
BP PLC ADR ^ | 28,610 | 1,422 | ||||||
British Sky Broadcasting Group PLC | 79,790 | 486 | ||||||
Cadbury PLC | 38,348 | 352 | ||||||
Compass Group PLC | 92,320 | 429 | ||||||
GlaxoSmithKline PLC | 49,349 | 949 | ||||||
Group 4 Securicor PLC | 220,390 | 668 | ||||||
HSBC Holdings PLC | 38,729 | 459 | ||||||
HSBC Holdings PLC ADR ^ | 310 | 18 | ||||||
Kingfisher PLC ADR ^ | 52,500 | 190 | ||||||
Kingfisher PLC | 123,010 | 227 | ||||||
Pearson PLC | 59,240 | 590 | ||||||
Rolls-Royce Group PLC -Class C ‡ | 6,901,809 | 11 | ||||||
Rolls-Royce Group PLC ‡ | 120,661 | 638 | ||||||
Royal Bank of Scotland PLC | 153,411 | 169 | ||||||
Royal Dutch Shell PLC -Class B | 36,910 | 1,001 |
The notes to the financial statements are an integral part of this report.
61
Shares | Value | |||||||
United Kingdom (continued) | ||||||||
Unilever PLC | 34,487 | $ | 775 | |||||
Vodafone Group PLC | 618,342 | 1,190 | ||||||
Wolseley PLC | 44,260 | 242 | ||||||
United States (42.2%) | ||||||||
Allergan, Inc. ^ | 27,000 | 1,071 | ||||||
Amazon.com, Inc. ‡ ^ | 34,000 | 1,946 | ||||||
American Express Co. | 26,000 | 715 | ||||||
Apple, Inc. ‡ ^ | 20,100 | 2,163 | ||||||
AT&T, Inc. | 47,000 | 1,257 | ||||||
Becton Dickinson & Co. | 13,420 | 931 | ||||||
Boeing Co. ^ | 15,500 | 810 | ||||||
BorgWarner, Inc. ^ | 37,300 | 838 | ||||||
Caterpillar, Inc. ^ | 21,800 | 832 | ||||||
CME Group, Inc. -Class A ^ | 4,000 | 1,129 | ||||||
Ecolab, Inc. ^ | 31,500 | 1,174 | ||||||
Expeditors International of Washington, Inc. ^ | 41,700 | 1,362 | ||||||
General Electric Co. | 92,000 | 1,795 | ||||||
Gilead Sciences, Inc. ‡ | 51,500 | 2,361 | ||||||
Google, Inc. -Class A ‡ | 5,000 | 1,797 | ||||||
Jacobs Engineering Group, Inc. ‡ | 41,000 | 1,494 | ||||||
Johnson Controls, Inc. | 73,000 | 1,294 | ||||||
PACCAR, Inc. ^ | 47,000 | 1,374 | ||||||
Praxair, Inc. | 42,000 | 2,736 | ||||||
Qualcomm, Inc. | 51,500 | 1,970 | ||||||
Raytheon Co. ^ | 46,000 | 2,351 | ||||||
Sigma-Aldrich Corp. ^ | 36,000 | 1,579 | ||||||
T. Rowe Price Group, Inc. ^ | 46,500 | 1,839 | ||||||
Tyco Electronics, Ltd. | 84,000 | 1,633 | ||||||
Union Pacific Corp. | 30,000 | 2,003 | ||||||
Varian Medical Systems, Inc. ‡ ^ | 38,000 | 1,729 | ||||||
Wells Fargo & Co. ^ | 44,000 | 1,499 | ||||||
Total Common Stocks (cost $128,580) | $ | 93,561 | ||||||
Principal | ||||||||
REPURCHASE AGREEMENT (4.9%) | ||||||||
United States (4.9%) | ||||||||
State Street Repurchase Agreement 0.15%, dated 10/31/2008, to be repurchased at $4,806 on 11/03/2008 ◊ • | $ | 4,806 | 4,806 | |||||
Total Repurchase Agreement (cost $4,806) | 4,806 | |||||||
Shares | ||||||||
RIGHTS (0.1%) | ||||||||
France (0.1%) | ||||||||
Suez Environnement SA | 15,150 | 69 | ||||||
Total Rights (cost $107) | 69 | |||||||
SECURITIES LENDING COLLATERAL (25.7%) | ||||||||
State Street Navigator Securities Lending Trust - Prime Portfolio, 2.71% ◊ ▲ | 25,399,984 | 25,400 | ||||||
Total Securities Lending Collateral (cost $25,400) | 25,400 | |||||||
Total Investment Securities (cost $158,893) # | $ | 123,836 | ||||||
The notes to the financial statements are an integral part of this report.
62
Percentage of | ||||||||
Total Investments | Value | |||||||
INVESTMENTS BY INDUSTRY: | ||||||||
Diversified Telecommunication Services | 5.2 | % | $ | 6,429 | ||||
Oil, Gas & Consumable Fuels | 4.5 | % | 5,539 | |||||
Chemicals | 4.4 | % | 5,489 | |||||
Pharmaceuticals | 4.4 | % | 5,475 | |||||
Aerospace & Defense | 4.0 | % | 4,972 | |||||
Commercial Banks | 4.0 | % | 4,930 | |||||
Insurance | 2.8 | % | 3,427 | |||||
Industrial Conglomerates | 2.8 | % | 3,422 | |||||
Health Care Equipment & Supplies | 2.4 | % | 3,004 | |||||
Electronic Equipment & Instruments | 2.2 | % | 2,766 | |||||
Auto Components | 2.1 | % | 2,668 | |||||
Communications Equipment | 2.0 | % | 2,424 | |||||
Biotechnology | 1.9 | % | 2,361 | |||||
Computers & Peripherals | 1.9 | % | 2,358 | |||||
Food Products | 1.9 | % | 2,291 | |||||
Machinery | 1.8 | % | 2,206 | |||||
Capital Markets | 1.7 | % | 2,127 | |||||
Media | 1.7 | % | 2,127 | |||||
Road & Rail | 1.6 | % | 2,003 | |||||
Internet & Catalog Retail | 1.6 | % | 1,946 | |||||
Automobiles | 1.6 | % | 1,942 | |||||
Semiconductors & Semiconductor Equipment | 1.5 | % | 1,870 | |||||
Air Freight & Logistics | 1.5 | % | 1,823 | |||||
Internet Software & Services | 1.4 | % | 1,797 | |||||
Wireless Telecommunication Services | 1.4 | % | 1,770 | |||||
Diversified Financial Services | 1.4 | % | 1,723 | |||||
Software | 1.4 | % | 1,728 | |||||
Construction & Engineering | 1.2 | % | 1,494 | |||||
Consumer Finance | 1.0 | % | 1,184 | |||||
Electric Utilities | 0.9 | % | 1,145 | |||||
Hotels, Restaurants & Leisure | 0.8 | % | 965 | |||||
Energy Equipment & Services | 0.8 | % | 941 | |||||
Specialty Retail | 0.7 | % | 924 | |||||
Commercial Services & Supplies | 0.7 | % | 915 | |||||
Multi-Utilities | 0.6 | % | 713 | |||||
Professional Services | 0.6 | % | 686 | |||||
Paper & Forest Products | 0.5 | % | 632 | |||||
Health Care Providers & Services | 0.5 | % | 578 | |||||
Life Sciences Tools & Services | 0.4 | % | 612 | |||||
Real Estate Management & Development | 0.4 | % | 451 | |||||
Office Electronics | 0.3 | % | 358 | |||||
Metals & Mining | 0.3 | % | 337 | |||||
Construction Materials | 0.2 | % | 315 | |||||
Electrical Equipment | 0.2 | % | 276 | |||||
Household Durables | 0.2 | % | 245 | |||||
Trading Companies & Distributors | 0.2 | % | 242 | |||||
Investment Securities, at Value | 75.6 | % | 93,630 | |||||
Short-Term Investments | 24.4 | % | 30,206 | |||||
Total Investments | 100.0 | % | $ | 123,836 | ||||
The notes to the financial statements are an integral part of this report.
63
NOTES TO SCHEDULE OF INVESTMENTS: | ||
^ | All or a portion of this security is on loan. The value of all securities on loan is $24,674. | |
‡ | Non-income producing security. | |
• | Repurchase agreement is collateralized by U.S. Government Agency Obligations with interest rates ranging from 3.56% to 5.00%, maturity dates ranging between 12/01/2019 — 10/25/2036, and with market values plus accrued interests of $4,907. | |
◊ | State Street Bank & Trust Company serves as the accounting, custody, and lending agent for the Fund and provides various services on behalf of the Fund. | |
▲ | Interest rate shown reflects the yield at 10/31/2008. | |
# | Aggregate cost for federal income tax purposes is $159,716. Aggregate gross unrealized appreciation/depreciation for all securities in which there is an excess of value over tax cost were $1,580 and $37,460, respectively. Net unrealized depreciation for tax purposes is $35,880. |
Security Valuation - If the market quotations are not readily available, or if the investment advisor determines that the quotation does not represent a fair value, then the security is valued at a fair value as determined in good faith using procedures approved by the Board of Trustees of the Fund. The Fund has retained an independent statistical fair value pricing service to assist in the fair valuation process for securities principally traded in the foreign market in order to adjust for possible changes in the value that may occur between the close of the foreign exchange and the time at which the Fund’s shares are valued. At 10/31/2008, the fair value pricing model was employed. The prices of securities used by the Fund to calculate its net asset value may differ from quoted or published prices for the same securities. In addition, fair values may not reflect the price that the Fund could obtain for a security if it were to dispose of that security at the time of pricing.
DEFINITIONS:
144A | 144A Securities are registered pursuant to Rule 144A of the Securities Act of 1933. These securities are deemed to be liquid for purposes of compliance limitations on holdings of illiquid securities and may be resold as transactions exempt from registration, normally to qualified institutional buyers. At 10/31/2008, these securities aggregated $994, or 1.01% of the Fund’s net assets. | |
ADR | American Depositary Receipt | |
GDR | Global Depositary Receipt | |
PLC | Public Limited Company |
The notes to the financial statements are an integral part of this report.
64
Transamerica Value Balanced
(unaudited)
(unaudited)
MARKET ENVIRONMENT
US securities markets faced many challenges in the twelve months ended October 31, 2008, ultimately delivering strongly negative returns across the board. The Russell 1000® Value Index (“Russell 1000 Value”) declined 36.80% and the Barclays Capital (formerly Lehman Brothers) US Aggregate Bond Index (“BCAB”) slightly increased 0.30%.
Throughout the period, problems plaguing the housing market continued, while commodity prices first soared then plummeted. Meanwhile, what began as concerns about securities related to defaulting sub-prime mortgages escalated into a variety of increasingly severe crises in the markets where banks lend to each other and to businesses, causing extreme disruption in both US and foreign financial markets. As the problems multiplied, financial institutions tightened their lending standards. The higher borrowing costs made it more difficult for companies to fund payroll, inventory and other near-term expenses. Consumers, already feeling the effects of higher energy and food prices, rising unemployment and lack of wage growth, also found it more difficult to borrow. Although the Federal Reserve Board (“Fed”) and the US government intervened to restore confidence in the financial systems, the US headed toward recession and expectations of a global economic slowdown increased.
PERFORMANCE
For the year ended October 31, 2008, Transamerica Value Balanced Class A returned (32.94)%. By comparison, its primary and secondary benchmarks, the Russell 1000 Value and the BCAB, returned (36.80)% and 0.30%, respectively.
STRATEGY REVIEW
The portfolio underperformed the blended benchmark, reflecting an overweighting in equities, which underperformed bonds, and underperformance of the equity and bond portfolios as compared to their respective benchmarks.
On the equity side, we attribute underperformance to overweighting energy and shipping-related stocks. As the period progressed, investors shunned these stocks over concerns that the global supply-demand ratios driving their growth will deteriorate as economic growth abates worldwide. The largest individual detractors from relative performance included Aegean Marine Petroleum Network Inc. and McDermott International, Inc., an oil services company. The negative impact of these was partially offset by another energy stock, Fording Canadian Coal Trust, and by gains from software giant Microsoft Corporation early in the period. Management of the portfolio was transferred to a new team at Transamerica Investment Management as of October 1, 2008. The new team began repositioning the portfolio to be more diversified by sector and industry while keeping it relatively concentrated in 35 — 45 names. In selecting stocks to replace the energy, shipping and other stocks vulnerable to the slowing global economy, we focused on companies that derive more of their revenues from US sources.
We believe that since the US was first to take action to stave off recession, it also will emerge from the economic downturn before others do.
In the bond portfolio, an overweighting of non-government sectors (i.e., investment-grade corporate securities and agency mortgage securities), which lagged the Treasury sector, was the primary source of underperformance. The negative effect of these overweightings was partially mitigated by our individual security selection. Among investment-grade corporate bonds, we had no exposure to the most distressed companies in the troubled financial services sector. Our mortgage exposure emphasized short-duration agency collateralized mortgage obligations, which were less volatile than other mortgage securities.
We believe a consumer-driven recession has already arrived. We believe the federal government’s $700-billion rescue of the financial services sector should provide some much-needed rationality in the markets. We believe it should help to rebuild trust and reduce the severity of the recession. In the interim, we believe high levels of market volatility will likely persist.
Greg D. Haendel, CFA
Geoffrey I. Edelstein, CFA, CIC
Derek S. Brown, CFA
Scott L. Dinsdale, CFA
Kirk R. Feldhus
Brian W. Westhoff, CFA
Geoffrey I. Edelstein, CFA, CIC
Derek S. Brown, CFA
Scott L. Dinsdale, CFA
Kirk R. Feldhus
Brian W. Westhoff, CFA
Co-Portfolio Managers
Transamerica Investment Management, LLC
Transamerica Investment Management, LLC
Prior to October 1, 2008, Heidi Y. Hu and Michelle E. Stevens were co-portfolio managers to this fund.
65
![(LINE GRAPH)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025740.gif)
Average Annual Total Return for Periods Ended 10/31/2008
From | Inception | |||||||||||||||||||
1 Year | 5 Years | 10 Years | Inception | Date | ||||||||||||||||
Class A (NAV) | (32.94 | )% | 0.14 | % | 1.05 | % | 3.70 | % | 10/1/95 | |||||||||||
Class A (POP) | (36.64 | )% | (0.99 | )% | 0.48 | % | 3.25 | % | 10/1/95 | |||||||||||
Russell 1000 Value(1) | (36.80 | )% | 1.90 | % | 2.79 | % | 7.14 | % | 10/1/95 | |||||||||||
Barclays Capital U.S. Aggregate Bond Index(1) | 0.30 | % | 3.48 | % | 5.00 | % | 5.75 | % | 10/1/95 | |||||||||||
Class B (NAV) | (33.37 | )% | (0.53 | )% | 0.51 | % | 3.28 | % | 10/1/95 | |||||||||||
Class B (POP) | (36.47 | )% | (0.69 | )% | 0.51 | % | 3.28 | % | 10/1/95 | |||||||||||
Class C (NAV) | (33.33 | )% | (0.49 | )% | N/A | 2.64 | % | 11/11/02 | ||||||||||||
Class C (POP) | (33.94 | )% | (0.49 | )% | N/A | 2.64 | % | 11/11/02 |
NOTES | ||
(1) | The Russell 1000 Value Index and the Barclays Capital U.S. Aggregate Bond Index (formerly Lehman Brothers Aggregate Bond) are unmanaged indices used as a general measure of market performance. Calculations assume dividends and capital gains are reinvested and do not include any managerial expenses. You cannot directly invest in an index. |
The performance data presented represents past performance; future results may vary. Performance data does not reflect the deduction of taxes that would be paid on fund distributions or the redemption of fund shares. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than performance quoted. Please see www.transamericafunds.com for performance data current to the most recent month-end. Public Offering Price (POP) returns include the reinvestment of dividends and capital gains and reflect the maximum sales charge of 5.5% for A shares or the maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 6 years) for Class B shares and 1% (during the first 12 months) for Class C shares. Shares purchased prior to March 1, 2004 are subject to a maximum applicable contingent deferred sales charge (5% in the 1st year, decreasing to 0% after 7 years) for Class B shares and (2% in the 1st year, decreasing to 0% after 2 years) for Class C shares. Net Asset Value (NAV) returns include the reinvestment of dividends and capital gains but do not reflect any sales charges.
This material must be preceded or accompanied by a current prospectus, which includes specific contents regarding the investment objectives and policies of this Fund.
66
UNDERSTANDING YOUR FUND’S EXPENSES
(unaudited)
(unaudited)
SHAREHOLDER EXPENSES
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, contingent deferred sales charges on redemptions and redemption fees; and (2) ongoing costs, including management fees, 12b-1 distribution and service fees, and other fund expenses.
The following Example is intended to help you understand your ongoing costs (in dollars and cents) of investing in the Fund and to compare these costs with the ongoing costs of investing in other funds.
The Example is based on an investment of $1,000 invested at May 1, 2008 and held for the entire period until October 31, 2008.
ACTUAL EXPENSES
The first line in the table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line of your Fund under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. If your account is an IRA, your expenses could have included a $15 annual fee. The amount of any fee paid through your account would increase the estimate of expenses you paid during the period and decrease your ending account value.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line in the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. As in the case of the actual expense example, if your account is subject to an IRA fee, the amount of the fee paid through your account would increase the hypothetical expenses you would have paid during the period and decrease the hypothetical ending account value.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges, redemption fees, brokerage commissions paid on purchases and sales of fund shares. Therefore, the second line under the Fund in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. If any of these transaction costs were included, your costs would be higher. The expenses shown in the table do not reflect any fees that may be charged to you by brokers, financial intermediaries or other financial institutions.
Beginning | Ending | Annualized | Expenses | |||||||||||||
Account | Account | Expense | Paid During | |||||||||||||
Value | Value | Ratio | Period (a) | |||||||||||||
Class A | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 738.57 | 1.55 | % | $ | 6.77 | ||||||||
Hypothetical (b) | 1,000.00 | 1,017.34 | 1.55 | 7.86 | ||||||||||||
Class B | ||||||||||||||||
Actual | 1,000.00 | 736.21 | 2.20 | 9.60 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,014.08 | 2.20 | 11.14 | ||||||||||||
Class C | ||||||||||||||||
Actual | 1,000.00 | 736.65 | 2.10 | 9.17 | ||||||||||||
Hypothetical (b) | 1,000.00 | 1,014.58 | 2.10 | 10.63 |
(a) | Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days), and divided by the number of days in the year (366 days). | |
(b) | 5% return per year before expenses. |
GRAPHICAL PRESENTATION OF SCHEDULE OF INVESTMENTS
By Asset Type
At October 31, 2008
(unaudited)
By Asset Type
At October 31, 2008
(unaudited)
![(PIE CHART)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025741.gif)
This chart shows the percentage breakdown by Asset Type of the Fund’s total investment securities. Percentage breakdown of Short-term category includes Securities Lending Collateral.
67
SCHEDULE OF INVESTMENTS
At October 31, 2008
(all amounts except share amounts in thousands)
At October 31, 2008
(all amounts except share amounts in thousands)
Principal | Value | |||||||
U.S. GOVERNMENT OBLIGATIONS (3.0%) | ||||||||
U.S. Treasury Bond | ||||||||
4.38%, due 02/15/2038 ^ | $ | 265 | $ | 266 | ||||
5.00%, due 05/15/2037 | 25 | 28 | ||||||
U.S. Treasury Inflation Indexed Note | ||||||||
1.38%, due 07/15/2018 ^ | 51 | 43 | ||||||
U.S. Treasury Note | ||||||||
3.13%, due 09/30/2013 ^ | 447 | 454 | ||||||
4.00%, due 08/15/2018 ^ | 132 | 132 | ||||||
Total U.S. Government Obligations (cost $941) | 923 | |||||||
U.S. GOVERNMENT AGENCY OBLIGATIONS (18.3%) | ||||||||
Fannie Mae | ||||||||
4.72%, due 10/01/2035 * | 338 | 339 | ||||||
5.00%, due 05/01/2018 | 89 | 88 | ||||||
5.50%, due 07/01/2019 - 01/01/2038 | 1,323 | 1,304 | ||||||
6.00%, due 04/01/2033 - 12/01/2037 | 1,267 | 1,267 | ||||||
6.50%, due 10/01/2037 | 391 | 397 | ||||||
Freddie Mac | ||||||||
5.00%, due 04/01/2018 - 11/15/2032 | 1,189 | 1,166 | ||||||
5.35%, due 11/14/2011 | 120 | 120 | ||||||
5.50%, due 09/01/2018 - 11/01/2018 | 140 | 141 | ||||||
5.51%, due 09/01/2037 * | 363 | 365 | ||||||
6.00%, due 12/01/2033 | 276 | 276 | ||||||
Ginnie Mae | ||||||||
6.00%, due 06/15/2034 | 131 | 131 | ||||||
6.50%, due 10/15/2027 | 55 | 56 | ||||||
Total U.S. Government Agency Obligations (cost $5,730) | 5,650 | |||||||
MORTGAGE-BACKED SECURITIES (2.6%) | ||||||||
American Tower Trust | ||||||||
Series 2007-1A, Class C | ||||||||
5.62%, due 04/15/2037 -144A | 155 | 128 | ||||||
Bear Stearns Commercial Mortgage Securities | ||||||||
Series 2006-PW14, Class A4 | ||||||||
5.20%, due 12/11/2038 | 238 | 179 | ||||||
Morgan Stanley Capital I | ||||||||
Series 2006-HQ10, Class A4 | ||||||||
5.33%, due 11/12/2041 | 232 | 176 | ||||||
SBA CMBS Trust | ||||||||
Series 2006-1A, Class A | ||||||||
5.31%, due 11/15/2036 -144A | 150 | 140 | ||||||
Wachovia Bank Commercial Mortgage Trust | ||||||||
Series 2006-C28, Class A4 | ||||||||
5.57%, due 10/15/2048 | 223 | 170 | ||||||
Series 2007-C32, Class H | ||||||||
5.74%, due 06/15/2049 -144A | 85 | 22 | ||||||
Total Mortgage-Backed Securities (cost $1,077) | 815 | |||||||
ASSET-BACKED SECURITY (0.4%) | ||||||||
USAA Auto Owner Trust | ||||||||
Series 2008-2, Class A3 | ||||||||
4.64%, due 10/15/2012 | 135 | 131 | ||||||
Total Asset-Backed Security (cost $135) | 131 | |||||||
CORPORATE DEBT SECURITIES (12.0%) | ||||||||
Airlines (0.4%) | ||||||||
Continental Airlines, Inc. | ||||||||
7.49%, due 10/02/2010 | 75 | 70 | ||||||
Delta Air Lines, Inc. | ||||||||
7.57%, due 11/18/2010 | 85 | 71 | ||||||
Automobiles (0.8%) | ||||||||
Daimler Finance North America LLC | ||||||||
3.25%, due 03/13/2009 * | 115 | 109 | ||||||
8.00%, due 06/15/2010 | 130 | 115 | ||||||
Beverages (0.8%) | ||||||||
Diageo Capital PLC | ||||||||
5.75%, due 10/23/2017 ^ | 148 | 127 | ||||||
PepsiCo, Inc. | ||||||||
7.90%, due 11/01/2018 | 125 | 132 | ||||||
Building Products (0.3%) | ||||||||
CRH America, Inc. | ||||||||
5.30%, due 10/15/2013 | 100 | 80 | ||||||
Capital Markets (0.4%) | ||||||||
Merrill Lynch & Co., Inc. | ||||||||
5.45%, due 02/05/2013 | 150 | 135 | ||||||
Commercial Banks (0.5%) | ||||||||
Barclays Bank PLC | ||||||||
7.70%, due 04/25/2018 -144A n Ž | 120 | 83 | ||||||
PNC Bank NA | ||||||||
6.88%, due 04/01/2018 | 80 | 74 | ||||||
Diversified Financial Services (1.2%) | ||||||||
General Electric Capital Corp. | ||||||||
4.80%, due 05/01/2013 | 130 | 117 | ||||||
Glencore Funding LLC | ||||||||
6.00%, due 04/15/2014 -144A | 138 | 130 | ||||||
Pemex Finance, Ltd. | ||||||||
9.03%, due 02/15/2011 | 125 | 126 | ||||||
Diversified Telecommunication Services (0.4%) | ||||||||
Verizon Communications, Inc. | ||||||||
8.75%, due 11/01/2018 | 123 | 126 | ||||||
Food & Staples Retailing (0.3%) | ||||||||
Stater Brothers Holdings, Inc. | ||||||||
8.13%, due 06/15/2012 | 100 | 89 | ||||||
Food Products (0.5%) | ||||||||
Cargill, Inc. | ||||||||
5.60%, due 09/15/2012 -144A | 80 | 74 | ||||||
Michael Foods, Inc. | ||||||||
8.00%, due 11/15/2013 | 90 | 78 | ||||||
Hotels, Restaurants & Leisure (0.2%) | ||||||||
Royal Caribbean Cruises, Ltd. | ||||||||
8.75%, due 02/02/2011 | 70 | 60 | ||||||
Household Products (0.2%) | ||||||||
Kimberly-Clark Corp. | ||||||||
6.63%, due 08/01/2037 | 80 | 70 | ||||||
Industrial Conglomerates (0.4%) | ||||||||
Hutchison Whampoa International, Ltd. | ||||||||
5.45%, due 11/24/2010 -144A | 140 | 132 | ||||||
Insurance (0.1%) | ||||||||
Oil Insurance, Ltd. | ||||||||
7.56%, due 06/30/2011 -144A n Ž | 80 | 41 | ||||||
Machinery (0.3%) | �� | |||||||
Tyco Electronics Group SA | ||||||||
6.55%, due 10/01/2017 | 96 | 80 | ||||||
Media (0.8%) | ||||||||
Comcast Corp. | ||||||||
7.05%, due 03/15/2033 | 95 | 79 | ||||||
News America Holdings, Inc. | ||||||||
7.75%, due 12/01/2045 | 65 | 54 | ||||||
Time Warner Cable, Inc. | ||||||||
6.75%, due 07/01/2018 | 125 | 107 | ||||||
Metals & Mining (0.2%) | ||||||||
Arcelormittal | ||||||||
5.38%, due 06/01/2013 -144A | 80 | 65 |
The notes to the financial statements are an integral part of this report.
68
Principal | Value | |||||||
Multiline Retail (0.4%) | ||||||||
Neiman-Marcus Group, Inc. | ||||||||
9.00%, due 10/15/2015 | $ | 100 | $ | 69 | ||||
Target Corp. | ||||||||
7.00%, due 01/15/2038 | 79 | 60 | ||||||
Multi-Utilities (0.5%) | ||||||||
Sempra Energy | ||||||||
4.75%, due 05/15/2009 | 145 | 143 | ||||||
Oil, Gas & Consumable Fuels (0.8%) | ||||||||
Enterprise Products Operating, LP | ||||||||
4.63%, due 10/15/2009 | 120 | 115 | ||||||
Petrobras International Finance Co. | ||||||||
5.88%, due 03/01/2018 | 90 | 71 | ||||||
PetroHawk Energy Corp. | ||||||||
9.13%, due 07/15/2013 | 100 | 77 | ||||||
Paper & Forest Products (0.6%) | ||||||||
Celulosa Arauco y Constitucion SA | ||||||||
8.63%, due 08/15/2010 | 171 | 178 | ||||||
Real Estate Investment Trusts (0.5%) | ||||||||
Wea Finance LLC / WCI Finance LLC | ||||||||
5.40%, due 10/01/2012 -144A | 168 | 146 | ||||||
Real Estate Management & Development (0.5%) | ||||||||
Post Apartment Homes, LP | ||||||||
6.30%, due 06/01/2013 | 171 | 168 | ||||||
Road & Rail (0.9%) | ||||||||
Burlington Northern Santa Fe Corp. | ||||||||
6.13%, due 03/15/2009 | 80 | 80 | ||||||
Hertz Corp. | ||||||||
8.88%, due 01/01/2014 | 75 | 55 | ||||||
Norfolk Southern Corp. | ||||||||
6.20%, due 04/15/2009 | 120 | 120 | ||||||
Total Corporate Debt Securities (cost $4,211) | 3,706 | |||||||
Shares | ||||||||
COMMON STOCKS (57.9%) | ||||||||
Aerospace & Defense (1.4%) | ||||||||
Raytheon Co. ^ | 8,215 | 420 | ||||||
Auto Components (0.6%) | ||||||||
BorgWarner, Inc. ^ | 8,100 | 182 | ||||||
Capital Markets (2.3%) | ||||||||
AllianceBernstein Holding, LP ^ | 22,623 | 530 | ||||||
BlackRock, Inc. ^ | 1,530 | 201 | ||||||
Chemicals (1.5%) | ||||||||
Praxair, Inc. | 7,200 | 469 | ||||||
Construction & Engineering (0.3%) | ||||||||
Jacobs Engineering Group, Inc. ‡ | 2,519 | 92 | ||||||
Diversified Financial Services (3.8%) | ||||||||
Bank of America Corp. ^ | 19,021 | 460 | ||||||
CME Group, Inc. ^ | 1,095 | 309 | ||||||
JPMorgan Chase & Co. ^ | 9,800 | 404 | ||||||
Diversified Telecommunication Services (0.9%) | ||||||||
AT&T, Inc. | 10,868 | 291 | ||||||
Electric Utilities (0.7%) | ||||||||
Dominion Resources, Inc. ^ | 6,000 | 218 | ||||||
Electronic Equipment & Instruments (0.9%) | ||||||||
Tyco Electronics, Ltd. ^ | 13,700 | 266 | ||||||
Energy Equipment & Services (1.7%) | ||||||||
Transocean, Inc. ^ | 6,422 | 529 | ||||||
Food Products (2.0%) | ||||||||
Kraft Foods, Inc. -Class A ^ | 21,037 | 613 | ||||||
Health Care Equipment & Supplies (1.3%) | ||||||||
Becton Dickinson & Co. | 5,723 | 397 | ||||||
Household Products (2.4%) | ||||||||
Colgate-Palmolive Co. ^ | 7,000 | 439 | ||||||
Kimberly-Clark Corp. ^ | 5,000 | 307 | ||||||
Industrial Conglomerates (1.9%) | ||||||||
General Electric Co. | 29,579 | 577 | ||||||
Insurance (0.7%) | ||||||||
MetLife, Inc. ^ | 6,700 | 223 | ||||||
Life Sciences Tools & Services (1.6%) | ||||||||
Thermo Fisher Scientific, Inc. ‡ ^ | 12,000 | 487 | ||||||
Media (1.5%) | ||||||||
Walt Disney Co. ^ | 17,800 | 461 | ||||||
Metals & Mining (1.4%) | ||||||||
Cia Vale do Rio Doce ADR ^ | 34,000 | 446 | ||||||
Oil, Gas & Consumable Fuels (7.1%) | ||||||||
Anadarko Petroleum Corp. ^ | 11,000 | 388 | ||||||
BP PLC ADR ^ | 9,485 | 471 | ||||||
Exxon Mobil Corp. ^ | 10,700 | 793 | ||||||
XTO Energy, Inc. ^ | 15,000 | 539 | ||||||
Pharmaceuticals (9.4%) | ||||||||
Bristol-Myers Squibb Co. | 57,764 | 1,187 | ||||||
Merck & Co., Inc. ^ | 35,000 | 1,083 | ||||||
Pfizer, Inc. ^ | 36,935 | 654 | ||||||
Real Estate Investment Trusts (1.2%) | ||||||||
Plum Creek Timber Co., Inc. ^ | 10,200 | 380 | ||||||
Road & Rail (2.5%) | ||||||||
Union Pacific Corp. | 11,400 | 761 | ||||||
Software (3.3%) | ||||||||
Microsoft Corp. | 35,870 | 801 | ||||||
Oracle Corp. ‡ | 11,004 | 201 | ||||||
Textiles, Apparel & Luxury Goods (0.9%) | ||||||||
Nike, Inc. | 4,576 | 264 | ||||||
Tobacco (6.6%) | ||||||||
Lorillard, Inc. ^ | 11,000 | 725 | ||||||
Philip Morris International, Inc. | 30,400 | 1,322 | ||||||
Total Common Stocks (cost $18,387) | $ | 17,890 | ||||||
Principal | ||||||||
REPURCHASE AGREEMENT (6.0%) | ||||||||
State Street Repurchase Agreement 0.15%, dated 10/31/2008, to be repurchased at $1,848 on 11/03/2008 à • | $ | 1,848 | 1,848 | |||||
Total Repurchase Agreement (cost $1,848) | 1,848 | |||||||
Shares | ||||||||
SECURITIES LENDING COLLATERAL (23.0%) | ||||||||
State Street Navigator Securities Lending Trust - Prime Portfolio, 2.71% à ▲ | 7,120,161 | 7,120 | ||||||
Total Securities Lending Collateral (cost $7,120) | 7,120 | |||||||
Total Investment Securities (cost $39,449) # | $ | 38,083 | ||||||
The notes to the financial statements are an integral part of this report.
69
NOTES TO SCHEDULE OF INVESTMENTS: | ||
^ | All or a portion of this security is on loan. The value of all securities on loan is $6,953. | |
* | Floating or variable rate note. Rate is listed as of 10/31/2008. | |
Ž | The security has a perpetual maturity. The date shown is the next call date. | |
n | Coupon rate is fixed for a predetermined period of time and then converts to a floating rate until maturity/call date. Rate is listed as of 10/31/2008. | |
‡ | Non-income producing security. | |
• | Repurchase agreement is collateralized by a U.S. Government Agency Obligation with an interest rate of 4.00%, and a maturity date of 06/01/2014, and with a market value plus accrued interest of $1,887. | |
à | State Street Bank & Trust Company serves as the accounting, custody, and lending agent for the Fund and provides various services on behalf of the Fund. | |
▲ | Interest rate shown reflects the yield at 10/31/2008. | |
# | Aggregate cost for federal income tax purposes is $39,153. Aggregate gross unrealized appreciation/depreciation for all securities in which there is an excess of value over tax cost were $2,954 and $4,024, respectively. Net unrealized depreciation for tax purposes is $1,070. |
DEFINITIONS:
144A | 144A Securities are registered pursuant to Rule 144A of the Securities Act of 1933. These securities are deemed to be liquid for purposes of compliance limitations on holdings of illiquid securities and may be resold as transactions exempt from registration, normally to qualified institutional buyers. At 10/31/2008, these securities aggregated $961, or 3.11% of the Fund’s net assets. | |
ADR | American Depositary Receipt | |
LLC | Limited Liability Company | |
LP | Limited Partnership | |
PLC | Public Limited Company |
The notes to the financial statements are an integral part of this report.
70
STATEMENTS OF ASSETS AND LIABILITIES
At October 31, 2008
(all amounts except share amounts in thousands)
(all amounts except share amounts in thousands)
Transamerica | Transamerica | |||||||||||||||||||
Transamerica | Convertible | Transamerica | Transamerica | Growth | ||||||||||||||||
Balanced | Securities | Equity | Flexible Income | Opportunities | ||||||||||||||||
Assets: | ||||||||||||||||||||
Investment securities, at cost | $ | 148,281 | $ | 147,921 | $ | 1,481,800 | $ | 201,142 | $ | 231,521 | ||||||||||
Securities loaned, at value | 25,194 | 15,182 | 203,507 | 16,077 | 39,145 | |||||||||||||||
Investment securities, at value | $ | 130,300 | $ | 124,706 | $ | 1,265,888 | $ | 169,564 | $ | 199,883 | ||||||||||
Receivables: | ||||||||||||||||||||
Investment securities sold | 255 | 4,315 | — | 7,290 | 2,003 | |||||||||||||||
Shares of beneficial interest sold | 4 | 315 | 280 | 182 | 37 | |||||||||||||||
Interest | 540 | 401 | 1 | 2,548 | — | |||||||||||||||
Income from loaned securities | 18 | 12 | 80 | 11 | 55 | |||||||||||||||
Dividends | 81 | 124 | 1,316 | — | 50 | |||||||||||||||
Dividend reclaims | 63 | — | 459 | — | — | |||||||||||||||
Unrealized appreciation on forward foreign currency contracts | — | — | — | 48 | — | |||||||||||||||
Other | 41 | 8 | 421 | 16 | 18 | |||||||||||||||
$ | 131,302 | $ | 129,881 | $ | 1,268,445 | $ | 179,659 | $ | 202,046 | |||||||||||
Liabilities: | ||||||||||||||||||||
Investment securities purchased | 5,024 | 1,733 | 60,479 | 6,724 | 2,781 | |||||||||||||||
Accounts payable and accrued liabilities: | ||||||||||||||||||||
Shares of beneficial interest redeemed | 139 | 89 | 377 | 243 | 80 | |||||||||||||||
Management and advisory fees | 70 | 74 | 667 | 105 | 99 | |||||||||||||||
Distribution and service fees | 60 | 12 | 184 | 17 | 39 | |||||||||||||||
Trustees fees | 41 | 8 | 425 | 17 | 19 | |||||||||||||||
Transfer agent fees | 31 | 4 | 169 | 7 | 52 | |||||||||||||||
Administration fees | 2 | 2 | 17 | 3 | 3 | |||||||||||||||
Payable for collateral for securities on loan | 25,791 | 15,504 | 208,082 | 16,417 | 40,056 | |||||||||||||||
Other | 39 | 38 | 147 | 49 | 45 | |||||||||||||||
31,197 | 17,464 | 270,547 | 23,582 | 43,174 | ||||||||||||||||
Net Assets | $ | 100,105 | $ | 112,417 | $ | 997,898 | $ | 156,077 | $ | 158,872 | ||||||||||
Net Assets Consist of: | ||||||||||||||||||||
Shares of beneficial interest, unlimited shares authorized, no par value | $ | 111,952 | $ | 152,489 | $ | 1,675,207 | $ | 234,496 | $ | 322,557 | ||||||||||
Undistributed (accumulated) net investment income (loss) | 189 | 520 | 2,369 | 805 | (17 | ) | ||||||||||||||
Undistributed (accumulated) net realized gain (loss) from investments | 5,958 | (17,373 | ) | (463,601 | ) | (47,685 | ) | (132,021 | ) | |||||||||||
Net unrealized appreciation (depreciation) on: | ||||||||||||||||||||
Investment securities | (17,999 | ) | (23,219 | ) | (216,106 | ) | (31,586 | ) | (31,647 | ) | ||||||||||
Translation of assets and liabilities denominated in foreign currencies | 5 | — | 29 | 47 | — | |||||||||||||||
Net Assets | $ | 100,105 | $ | 112,417 | $ | 997,898 | $ | 156,077 | $ | 158,872 | ||||||||||
Net Assets by Class: | ||||||||||||||||||||
Class A | $ | 49,917 | $ | 10,748 | $ | 300,140 | $ | 13,360 | $ | 41,005 | ||||||||||
Class B | 32,469 | 2,920 | 59,479 | 8,628 | 20,823 | |||||||||||||||
Class C | 17,719 | 7,070 | 46,676 | 5,981 | 10,619 | |||||||||||||||
Class I | 91,679 | 500,722 | 128,108 | 86,425 | ||||||||||||||||
Class T | 90,881 | |||||||||||||||||||
Shares Outstanding: | ||||||||||||||||||||
Class A | 3,035 | 1,496 | 43,793 | 1,849 | 6,241 | |||||||||||||||
Class B | 1,984 | 410 | 9,272 | 1,194 | 3,395 | |||||||||||||||
Class C | 1,087 | 996 | 7,244 | 830 | 1,724 | |||||||||||||||
Class I | 12,756 | 71,654 | 17,662 | 12,829 | ||||||||||||||||
Class T | 4,749 | |||||||||||||||||||
Net Asset Value Per Share: | ||||||||||||||||||||
Class A | $ | 16.44 | $ | 7.18 | $ | 6.85 | $ | 7.22 | $ | 6.57 | ||||||||||
Class B | 16.37 | 7.13 | 6.42 | 7.23 | 6.13 | |||||||||||||||
Class C | 16.30 | 7.10 | 6.44 | 7.21 | 6.16 | |||||||||||||||
Class I | 7.19 | 6.99 | 7.25 | 6.74 | ||||||||||||||||
Class T | 19.14 | |||||||||||||||||||
Maximum Offering Price Per Share (a) | ||||||||||||||||||||
Class A | $ | 17.40 | $ | 7.54 | $ | 7.25 | $ | 7.58 | $ | 6.95 |
The notes to the financial statements are an integral part of this report.
71
Transamerica | Transamerica | Transamerica | ||||||||||||||||||
Transamerica | Legg Mason | Transamerica | Science & | Short-Term | ||||||||||||||||
High Yield Bond | Partners All Cap | Money Market | Technology | Bond | ||||||||||||||||
Assets: | ||||||||||||||||||||
Investment securities, at cost | $ | 686,204 | $ | 107,919 | $ | 274,133 | $ | 81,781 | $ | 537,189 | ||||||||||
Securities loaned, at value | 65,402 | 19,464 | — | 12,875 | 16,847 | |||||||||||||||
Investment securities, at value | $ | 508,664 | $ | 97,379 | $ | 274,133 | $ | 66,751 | $ | 516,480 | ||||||||||
Prepaid money market guarantee insurance | — | — | 15 | — | — | |||||||||||||||
Receivables: | ||||||||||||||||||||
Investment securities sold | 1,473 | — | — | — | 1,900 | |||||||||||||||
Shares of beneficial interest sold | 1 | 12 | 717 | 34 | 160 | |||||||||||||||
Interest | 15,046 | — | — | — | 5,522 | |||||||||||||||
Income from loaned securities | 61 | 12 | — | 16 | 13 | |||||||||||||||
Dividends | — | 71 | — | 25 | — | |||||||||||||||
Dividend reclaims | — | 26 | — | — | — | |||||||||||||||
Variation margin | — | — | — | — | 320 | |||||||||||||||
Other | 26 | 29 | 11 | 4 | — | |||||||||||||||
$ | 525,271 | $ | 97,529 | $ | 274,876 | $ | 66,830 | $ | 524,395 | |||||||||||
Liabilities: | ||||||||||||||||||||
Investment securities purchased | — | 27 | — | — | 1,413 | |||||||||||||||
Accounts payable and accrued liabilities: | ||||||||||||||||||||
Shares of beneficial interest redeemed | 129 | 114 | 2,469 | 4 | 143 | |||||||||||||||
Management and advisory fees | 241 | 61 | 91 | 34 | 276 | |||||||||||||||
Distribution and service fees | 21 | 51 | 119 | 4 | 7 | |||||||||||||||
Trustees fees | 28 | 29 | 14 | 4 | 2 | |||||||||||||||
Transfer agent fees | 7 | 31 | 30 | 4 | 1 | |||||||||||||||
Administration fees | 8 | 1 | 4 | 1 | 9 | |||||||||||||||
Dividends to shareholders | — | — | 216 | — | — | |||||||||||||||
Payable for collateral for securities on loan | 66,811 | 19,953 | — | 13,234 | 17,209 | |||||||||||||||
Other | 77 | 39 | 49 | 34 | 76 | |||||||||||||||
67,322 | 20,306 | 2,992 | 13,319 | 19,136 | ||||||||||||||||
Net Assets | $ | 457,949 | $ | 77,223 | $ | 271,884 | $ | 53,511 | $ | 505,259 | ||||||||||
Net Assets Consist of: | ||||||||||||||||||||
Shares of beneficial interest, unlimited shares authorized, no par value | $ | 643,275 | $ | 89,739 | $ | 271,801 | $ | 69,107 | $ | 538,833 | ||||||||||
Undistributed (accumulated) net investment income (loss) | 3,067 | 525 | 83 | (2 | ) | 1,333 | ||||||||||||||
Accumulated net realized loss from investments | (10,842 | ) | (2,488 | ) | — | (563 | ) | (14,040 | ) | |||||||||||
Net unrealized depreciation on: | ||||||||||||||||||||
Investment securities | (177,551 | ) | (10,553 | ) | — | (15,031 | ) | (20,707 | ) | |||||||||||
Futures contracts | — | — | — | — | (160 | ) | ||||||||||||||
Net Assets | $ | 457,949 | $ | 77,223 | $ | 271,884 | $ | 53,511 | $ | 505,259 | ||||||||||
Net Assets by Class: | ||||||||||||||||||||
Class A | $ | 24,506 | $ | 28,237 | $ | 142,456 | $ | 3,778 | $ | 5,663 | ||||||||||
Class B | 9,091 | 33,670 | 40,110 | 2,094 | ||||||||||||||||
Class C | 5,429 | 15,316 | 59,991 | 1,417 | 7,263 | |||||||||||||||
Class I | 418,923 | 29,327 | 46,222 | 492,333 | ||||||||||||||||
Shares Outstanding: | ||||||||||||||||||||
Class A | 3,877 | 2,828 | 142,456 | 1,330 | 600 | |||||||||||||||
Class B | 1,439 | 3,646 | 40,110 | 781 | ||||||||||||||||
Class C | 860 | 1,655 | 59,991 | 529 | 771 | |||||||||||||||
Class I | 65,845 | 29,327 | 15,972 | 53,046 | ||||||||||||||||
Net Asset Value Per Share: | ||||||||||||||||||||
Class A | $ | 6.31 | $ | 9.98 | $ | 1.00 | $ | 2.84 | $ | 9.44 | ||||||||||
Class B | 6.30 | 9.24 | 1.00 | 2.68 | ||||||||||||||||
Class C | 6.30 | 9.26 | 1.00 | 2.68 | 9.42 | |||||||||||||||
Class I | 6.35 | 1.00 | 2.89 | 9.28 | ||||||||||||||||
Maximum Offering Price Per Share (a) | ||||||||||||||||||||
Class A | $ | 6.62 | $ | 10.56 | $ | 1.00 | $ | 3.01 | $ | 9.68 |
The notes to the financial statements are an integral part of this report.
72
Transamerica | Transamerica | |||||||||||
Small/Mid Cap | Templeton | Transamerica | ||||||||||
Value | Global | Value Balanced | ||||||||||
Assets: | ||||||||||||
Investment securities, at cost | $ | 728,930 | $ | 158,893 | $ | 39,449 | ||||||
Foreign currency cost | — | 170 | — | |||||||||
Securities loaned, at value | 127,833 | 24,674 | 6,953 | |||||||||
Investment securities, at value | $ | 661,303 | $ | 123,836 | $ | 38,083 | ||||||
Foreign currency | — | 157 | — | |||||||||
Receivables: | ||||||||||||
Investment securities sold | 15,091 | 1,366 | 207 | |||||||||
Shares of beneficial interest sold | 1,471 | 9 | 3 | |||||||||
Interest | — | — | 102 | |||||||||
Income from loaned securities | 116 | 15 | 5 | |||||||||
Dividends | 360 | 264 | 54 | |||||||||
Dividend reclaims | — | 169 | — | |||||||||
Other | 14 | 119 | 16 | |||||||||
$ | 678,355 | $ | 125,935 | $ | 38,470 | |||||||
Liabilities: | ||||||||||||
Investment securities purchased | 2,849 | 1,341 | 295 | |||||||||
Accounts payable and accrued liabilities: | ||||||||||||
Shares of beneficial interest redeemed | 1,845 | 58 | 42 | |||||||||
Management and advisory fees | 404 | 89 | 24 | |||||||||
Distribution and service fees | 182 | 45 | 16 | |||||||||
Trustees fees | 17 | 119 | 16 | |||||||||
Transfer agent fees | 79 | 56 | 11 | |||||||||
Administration fees | 10 | 2 | 1 | |||||||||
Due to custodian | — | 12 | — | |||||||||
Payable for collateral for securities on loan | 131,870 | 25,400 | 7,120 | |||||||||
Other | 93 | 60 | 32 | |||||||||
137,349 | 27,182 | 7,557 | ||||||||||
Net Assets | $ | 541,006 | $ | 98,753 | $ | 30,913 | ||||||
Net Assets Consist of: | ||||||||||||
Shares of beneficial interest, unlimited shares authorized, no par value | $ | 699,842 | $ | 431,026 | $ | 35,700 | ||||||
Undistributed net investment income | 7,851 | 421 | 349 | |||||||||
Accumulated net realized loss from investments | (99,054 | ) | (297,573 | ) | (3,762 | ) | ||||||
Net unrealized depreciation on: | ||||||||||||
Investment securities | (67,633 | ) | (35,112 | ) | (1,374 | ) | ||||||
Translation of assets and liabilities denominated in foreign currencies | — | (9 | ) | — | ||||||||
Net Assets | $ | 541,006 | $ | 98,753 | $ | 30,913 | ||||||
Net Assets by Class: | ||||||||||||
Class A | $ | 199,210 | $ | 73,721 | $ | 18,666 | ||||||
Class B | 31,716 | 10,746 | 6,414 | |||||||||
Class C | 95,729 | 14,286 | 5,833 | |||||||||
Class I | 214,351 | |||||||||||
Shares Outstanding: | ||||||||||||
Class A | 15,685 | 3,754 | 2,096 | |||||||||
Class B | 2,603 | 584 | 722 | |||||||||
Class C | 7,913 | 782 | 658 | |||||||||
Class I | 16,736 | |||||||||||
Net Asset Value Per Share: | ||||||||||||
Class A | $ | 12.70 | $ | 19.63 | $ | 8.91 | ||||||
Class B | 12.19 | 18.41 | 8.88 | |||||||||
Class C | 12.10 | 18.27 | 8.87 | |||||||||
Class I | 12.81 | |||||||||||
Maximum Offering Price Per Share (a) | ||||||||||||
Class A | $ | 13.44 | $ | 20.77 | $ | 9.43 |
(a) | Includes the maximum selling commission (represented as a percentage of offering price) which is reduced on certain levels of sales as set forth in the Prospectus. Net asset value per share for classes B, C, and I shares represents offering price. The redemption price for Classes B and C shares equals net asset value less any applicable contingent deferred sales charge. |
The notes to the financial statements are an integral part of this report.
73
STATEMENTS OF OPERATIONS
For the year ended October 31, 2008
(all amounts except share amounts in thousands)
(all amounts except share amounts in thousands)
Transamerica | Transamerica | |||||||||||||||||||
Transamerica | Convertible | Transamerica | Transamerica | Growth | ||||||||||||||||
Balanced | Securities | Equity | Flexible Income | Opportunities | ||||||||||||||||
Investment Income: | ||||||||||||||||||||
Dividends | $ | 1,411 | $ | 1,117 | $ | 19,353 | $ | 475 | $ | 1,780 | ||||||||||
Withholding taxes on foreign dividends | — | — | — | (3 | ) | (1 | ) | |||||||||||||
Interest | 2,700 | 2,755 | 760 | 22,348 | 225 | |||||||||||||||
Income from loaned securities-net | 70 | 38 | 351 | 249 | 749 | |||||||||||||||
4,181 | 3,910 | 20,464 | 23,069 | 2,753 | ||||||||||||||||
Expenses: | ||||||||||||||||||||
Management and advisory fees | 1,210 | 1,172 | 11,079 | 2,535 | 2,135 | |||||||||||||||
Distribution and service fees: | ||||||||||||||||||||
Class A | 213 | 48 | 1,580 | 54 | 191 | |||||||||||||||
Class B | 640 | 50 | 1,236 | 130 | 418 | |||||||||||||||
Class C | 264 | 77 | 789 | 81 | 168 | |||||||||||||||
Transfer agent fees: | ||||||||||||||||||||
Class A | 178 | 19 | 1,297 | 40 | 327 | |||||||||||||||
Class B | 174 | 9 | 569 | 36 | 254 | |||||||||||||||
Class C | 55 | 7 | 224 | 16 | 82 | |||||||||||||||
Class T | 193 | |||||||||||||||||||
Printing and shareholder reports | 8 | 21 | 135 | 41 | 17 | |||||||||||||||
Custody fees | 28 | 19 | 152 | 44 | 31 | |||||||||||||||
Administration fees | 30 | 31 | 310 | 71 | 54 | |||||||||||||||
Legal fees | 4 | 4 | 39 | 9 | 6 | |||||||||||||||
Audit fees | 20 | 20 | 21 | 20 | 20 | |||||||||||||||
Trustees fees | 3 | 3 | 26 | 6 | 4 | |||||||||||||||
Registration fees | — | 2 | — | 1 | — | |||||||||||||||
Other | 23 | 36 | 88 | 36 | 37 | |||||||||||||||
Total expenses | 2,850 | 1,518 | 17,738 | 3,120 | 3,744 | |||||||||||||||
Net of reimbursement of class expenses: | ||||||||||||||||||||
Class A | (31 | ) | ||||||||||||||||||
Class B | (54 | ) | (27 | ) | ||||||||||||||||
Total reimbursed expenses | — | — | (54 | ) | — | (58 | ) | |||||||||||||
Net expenses | 2,850 | 1,518 | 17,684 | 3,120 | 3,686 | |||||||||||||||
Net Investment Income (Loss) | 1,331 | 2,392 | 2,780 | 19,949 | (933 | ) | ||||||||||||||
Net Realized Gain (Loss) from: | ||||||||||||||||||||
Investment securities | 6,221 | (17,308 | ) | (58,064 | ) | (34,897 | ) | (20,795 | ) | |||||||||||
Futures contracts | 1 | — | — | 2 | — | |||||||||||||||
Foreign currency transactions | — | — | — | 362 | — | |||||||||||||||
6,222 | (17,308 | ) | (58,064 | ) | (34,533 | ) | (20,795 | ) | ||||||||||||
Net Decrease in Unrealized Depreciation on: | ||||||||||||||||||||
Investment securities | (63,988 | ) | (55,761 | ) | (731,315 | ) | (26,145 | ) | (114,155 | ) | ||||||||||
Translation of assets and liabilities denominated in foreign currencies | — | — | 29 | 47 | — | |||||||||||||||
(63,988 | ) | (55,761 | ) | (731,286 | ) | (26,098 | ) | (114,155 | ) | |||||||||||
Net Realized and Unrealized Loss: | (57,766 | ) | (73,069 | ) | (789,350 | ) | (60,631 | ) | (134,950 | ) | ||||||||||
Net Decrease In Net Assets Resulting from Operations | $ | (56,435 | ) | $ | (70,677 | ) | $ | (786,570 | ) | $ | (40,682 | ) | $ | (135,883 | ) | |||||
The notes to the financial statements are an integral part of this report.
74
Transamerica Legg | Transamerica | |||||||||||||||||||
Transamerica High | Mason Partners All | Transamerica | Science & | Transamerica | ||||||||||||||||
Yield Bond | Cap | Money Market | Technology | Short-Term Bond | ||||||||||||||||
Investment Income: | ||||||||||||||||||||
Dividends | $ | — | $ | 2,990 | $ | — | $ | 177 | $ | — | ||||||||||
Withholding taxes on foreign dividends | — | (18 | ) | — | (2 | ) | — | |||||||||||||
Interest | 39,989 | 22 | 6,660 | 31 | 28,606 | |||||||||||||||
Income from loaned securities-net | 410 | 72 | — | 195 | 194 | |||||||||||||||
40,399 | 3,066 | 6,660 | 401 | 28,800 | ||||||||||||||||
Expenses: | ||||||||||||||||||||
Management and advisory fees | 2,652 | 1,022 | 822 | 619 | 3,522 | |||||||||||||||
Distribution and service fees: | ||||||||||||||||||||
Class A | 118 | 142 | 399 | 22 | 6 | |||||||||||||||
Class B | 155 | 616 | 270 | 35 | — | |||||||||||||||
Class C | 86 | 256 | 325 | 22 | 22 | |||||||||||||||
Transfer agent fees: | ||||||||||||||||||||
Class A | 54 | 143 | 271 | 27 | 1 | |||||||||||||||
Class B | 32 | 211 | 69 | 22 | ||||||||||||||||
Class C | 13 | 65 | 61 | 9 | 1 | |||||||||||||||
Class I | — | (a) | — | (a) | — | (a) | 1 | |||||||||||||
Printing and shareholder reports | 56 | 10 | 23 | 8 | 70 | |||||||||||||||
Custody fees | 56 | 31 | 29 | 12 | 65 | |||||||||||||||
Administration fees | 90 | 26 | 41 | 16 | 114 | |||||||||||||||
Legal fees | 11 | 3 | — | 2 | 14 | |||||||||||||||
Audit fees | 20 | 20 | 20 | 20 | 20 | |||||||||||||||
Trustees fees | 7 | 2 | — | 1 | 9 | |||||||||||||||
Registration fees | 8 | — | 2 | — | 2 | |||||||||||||||
Money Market guarantee insurance fees | — | — | 7 | — | — | |||||||||||||||
Other | 36 | 28 | 59 | 46 | 74 | |||||||||||||||
Total expenses | 3,394 | 2,575 | 2,398 | 861 | 3,921 | |||||||||||||||
Net of reimbursement of class expenses: | ||||||||||||||||||||
Class A | (17 | ) | (276 | ) | (11 | ) | ||||||||||||||
Class B | (24 | ) | (71 | ) | (12 | ) | ||||||||||||||
Class C | (62 | ) | (3 | ) | ||||||||||||||||
Class I | (2 | ) | ||||||||||||||||||
Total reimbursed expenses | — | (41 | ) | (411 | ) | (26 | ) | — | ||||||||||||
Net expenses | 3,394 | 2,534 | 1,987 | 835 | 3,921 | |||||||||||||||
Net Investment Income (Loss) | 37,005 | 532 | 4,673 | (434 | ) | 24,879 | ||||||||||||||
Net Realized Loss from: | ||||||||||||||||||||
Investment securities | (9,296 | ) | (1,842 | ) | — | (562 | ) | (10,112 | ) | |||||||||||
Futures contracts | — | — | — | — | (29 | ) | ||||||||||||||
Foreign currency transactions | — | — | — | (1 | ) | — | ||||||||||||||
(9,296 | ) | (1,842 | ) | — | (563 | ) | (10,141 | ) | ||||||||||||
Net Decrease in Unrealized Depreciation on: | ||||||||||||||||||||
Investment securities | (173,227 | ) | (48,557 | ) | — | (48,013 | ) | (19,666 | ) | |||||||||||
Futures contracts | — | — | — | — | (160 | ) | ||||||||||||||
(173,227 | ) | (48,557 | ) | — | (48,013 | ) | (19,826 | ) | ||||||||||||
Net Realized and Unrealized Loss: | (182,523 | ) | (50,399 | ) | — | (48,576 | ) | (29,967 | ) | |||||||||||
Net Increase (Decrease) In Net Assets Resulting from Operations | $ | (145,518 | ) | $ | (49,867 | ) | $ | 4,673 | $ | (49,010 | ) | $ | (5,088 | ) | ||||||
The notes to the financial statements are an integral part of this report.
75
Transamerica | ||||||||||||
Small/Mid Cap | Transamerica | Transamerica Value | ||||||||||
Value | Templeton Global | Balanced | ||||||||||
Investment Income: | ||||||||||||
Dividends | $ | 15,932 | $ | 4,762 | $ | 1,119 | ||||||
Withholding taxes on foreign dividends | (2 | ) | (339 | ) | (1 | ) | ||||||
Interest | 1,029 | 79 | 803 | |||||||||
Income from loaned securities-net | 1,346 | 76 | 18 | |||||||||
18,305 | 4,578 | 1,939 | ||||||||||
Expenses: | ||||||||||||
Management and advisory fees | 5,769 | 1,441 | 359 | |||||||||
Distribution and service fees: | ||||||||||||
Class A | 687 | 376 | 95 | |||||||||
Class B | 444 | 345 | 117 | |||||||||
Class C | 937 | 243 | 91 | |||||||||
Transfer agent fees: | ||||||||||||
Class A | 410 | 416 | 78 | |||||||||
Class B | 100 | 189 | 43 | |||||||||
Class C | 171 | 93 | 19 | |||||||||
Printing and shareholder reports | 112 | 1 | — | (a) | ||||||||
Custody fees | 69 | 80 | 20 | |||||||||
Administration fees | 147 | 36 | 10 | |||||||||
Legal fees | 21 | 5 | 1 | |||||||||
Audit fees | 21 | 25 | 21 | |||||||||
Trustees fees | 14 | 4 | 1 | |||||||||
Registration fees | 13 | — | — | |||||||||
Other | 82 | — | 30 | |||||||||
Total expenses | 8,997 | 3,254 | 885 | |||||||||
Net of reimbursement of class expenses: | ||||||||||||
Class A | (66 | ) | (3 | ) | ||||||||
Class B | (82 | ) | (11 | ) | ||||||||
Class C | (14 | ) | ||||||||||
Total reimbursed expenses | — | (162 | ) | (14 | ) | |||||||
Net expenses | 8,997 | 3,092 | 871 | |||||||||
Net Investment Income | 9,308 | 1,486 | 1,068 | |||||||||
Net Realized Gain (Loss) from: | ||||||||||||
Investment securities | (98,519 | ) | 11,709 | (3,768 | ) | |||||||
Written option & swaption contracts | — | — | 38 | |||||||||
Foreign currency transactions | — | (486 | ) | — | ||||||||
(98,519 | ) | 11,223 | (3,730 | ) | ||||||||
Net Decrease in Unrealized Depreciation on: | ||||||||||||
Investment securities | (296,332 | ) | (105,600 | ) | (14,662 | ) | ||||||
Written option and swaption contracts | — | — | (34 | ) | ||||||||
Translation of assets and liabilities denominated in foreign currencies | — | (19 | ) | — | ||||||||
(296,332 | ) | (105,619 | ) | (14,696 | ) | |||||||
Net Realized and Unrealized Loss: | (394,851 | ) | (94,396 | ) | (18,426 | ) | ||||||
Net Decrease In Net Assets Resulting from Operations | $ | (385,543 | ) | $ | (92,910 | ) | $ | (17,358 | ) | |||
(a) | Rounds to less than $1. |
The notes to the financial statements are an integral part of this report.
76
STATEMENTS OF CHANGES IN NET ASSETS
(all amounts in thousands)
(all amounts in thousands)
Transamerica Convertible | Transamerica Flexible | |||||||||||||||||||||||||||||||
Transamerica Balanced | Securities | Transamerica Equity | Income | |||||||||||||||||||||||||||||
Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | |||||||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | |||||||||||||||||||||||||
2008 | 2007 | 2008 | 2007 | 2008 | 2007 | 2008 | 2007 | |||||||||||||||||||||||||
Increase (Decrease) in Net Assets From: | ||||||||||||||||||||||||||||||||
Operations: | ||||||||||||||||||||||||||||||||
Net investment income (loss) | $ | 1,331 | $ | 628 | $ | 2,392 | $ | 2,344 | $ | 2,780 | $ | (4,855 | ) | $ | 19,949 | $ | 20,505 | |||||||||||||||
Net realized gain (loss)(a) | 6,222 | 24,204 | (17,308 | ) | 36,172 | (58,064 | ) | 189,148 | (34,533 | ) | (6,948 | ) | ||||||||||||||||||||
Change in unrealized appreciation (depreciation)(b) | (63,988 | ) | 5,146 | (55,761 | ) | 6,185 | (731,286 | ) | 179,879 | (26,098 | ) | (5,879 | ) | |||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (56,435 | ) | 29,978 | (70,677 | ) | 44,701 | (786,570 | ) | 364,172 | (40,682 | ) | 7,678 | ||||||||||||||||||||
Distributions to Shareholders: | ||||||||||||||||||||||||||||||||
From net investment income: | ||||||||||||||||||||||||||||||||
Class A | (699 | ) | (334 | ) | (133 | ) | (60 | ) | (849 | ) | (829 | ) | ||||||||||||||||||||
Class B | (286 | ) | (175 | ) | (15 | ) | (18 | ) | (600 | ) | (899 | ) | ||||||||||||||||||||
Class C | (161 | ) | (62 | ) | (38 | ) | (10 | ) | (386 | ) | (472 | ) | ||||||||||||||||||||
Class I | (1,811 | ) | (2,421 | ) | (18,830 | ) | (17,840 | ) | ||||||||||||||||||||||||
(1,146 | ) | (571 | ) | (1,997 | ) | (2,509 | ) | — | — | (20,665 | ) | (20,040 | ) | |||||||||||||||||||
From net realized gains: | ||||||||||||||||||||||||||||||||
Class A | (1,615 | ) | (2,349 | ) | (337 | ) | ||||||||||||||||||||||||||
Class B | (2,368 | ) | (1,381 | ) | (351 | ) | ||||||||||||||||||||||||||
Class C | (828 | ) | (861 | ) | (180 | ) | ||||||||||||||||||||||||||
Class I | (31,579 | ) | (13,541 | ) | ||||||||||||||||||||||||||||
(4,811 | ) | — | (36,170 | ) | (14,409 | ) | — | — | — | — | ||||||||||||||||||||||
Capital Share Transactions: | ||||||||||||||||||||||||||||||||
Proceeds from shares sold: | ||||||||||||||||||||||||||||||||
Class A | 3,878 | 3,526 | 13,963 | 5,352 | 42,081 | 44,265 | 3,320 | 4,630 | ||||||||||||||||||||||||
Class B | 2,063 | 2,783 | 1,164 | 852 | 4,848 | 7,379 | 1,949 | 1,542 | ||||||||||||||||||||||||
Class C | 1,325 | 1,128 | 9,648 | 704 | 5,391 | 9,600 | 2,580 | 3,467 | ||||||||||||||||||||||||
Class I | 6,078 | 14,218 | 51,057 | 92,884 | 28,018 | 166,452 | ||||||||||||||||||||||||||
Class T | 1,798 | 1,657 | ||||||||||||||||||||||||||||||
7,266 | 7,437 | 30,853 | 21,126 | 105,175 | 155,785 | 35,867 | 176,091 | |||||||||||||||||||||||||
Dividends and distributions reinvested: | ||||||||||||||||||||||||||||||||
Class A | 2,018 | 320 | 1,721 | 368 | — | 509 | 695 | |||||||||||||||||||||||||
Class B | 2,440 | 163 | 1,103 | 303 | 369 | 720 | ||||||||||||||||||||||||||
Class C | 879 | 56 | 599 | 122 | 239 | 352 | ||||||||||||||||||||||||||
Class I | 32,781 | 15,962 | 15,299 | 17,840 | ||||||||||||||||||||||||||||
5,337 | 539 | 36,204 | 16,755 | — | — | 16,416 | 19,607 | |||||||||||||||||||||||||
Cost of shares redeemed: | ||||||||||||||||||||||||||||||||
Class A | (15,261 | ) | (16,478 | ) | (7,685 | ) | (2,550 | ) | (89,748 | ) | (136,142 | ) | (5,383 | ) | (7,258 | ) | ||||||||||||||||
Class B | (19,396 | ) | (30,403 | ) | (1,659 | ) | (2,301 | ) | (28,453 | ) | (55,373 | ) | (5,085 | ) | (7,431 | ) | ||||||||||||||||
Class C | (6,156 | ) | (10,378 | ) | (2,109 | ) | (1,357 | ) | (19,902 | ) | (24,350 | ) | (4,119 | ) | (7,097 | ) | ||||||||||||||||
Class I | (4,311 | ) | (162,514 | ) | (56,853 | ) | (86,650 | ) | (232,281 | ) | (23,682 | ) | ||||||||||||||||||||
Class T | (21,752 | ) | (51,342 | ) | ||||||||||||||||||||||||||||
(40,813 | ) | (57,259 | ) | (15,764 | ) | (168,722 | ) | (216,708 | ) | (353,857 | ) | (246,868 | ) | (45,468 | ) | |||||||||||||||||
Redemption fee: | ||||||||||||||||||||||||||||||||
Class A | — | — | — | — | 3 | 1 | — | — | ||||||||||||||||||||||||
— | — | — | — | 3 | 1 | — | — | |||||||||||||||||||||||||
Automatic conversions: | ||||||||||||||||||||||||||||||||
Class A | 24,175 | 10,022 | 645 | 99 | 48,320 | 21,409 | 3,069 | 809 | ||||||||||||||||||||||||
Class B | (24,175 | ) | (10,022 | ) | (645 | ) | (99 | ) | (48,320 | ) | (21,409 | ) | (3,069 | ) | (809 | ) | ||||||||||||||||
— | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Net increase (decrease) in net assets resulting from capital shares transactions | (28,210 | ) | (49,283 | ) | 51,293 | (130,841 | ) | (111,530 | ) | (198,071 | ) | (194,585 | ) | 150,230 | ||||||||||||||||||
Net Increase (Decrease) in net assets | (90,602 | ) | (19,876 | ) | (57,551 | ) | (103,058 | ) | (898,100 | ) | 166,101 | (255,932 | ) | 137,868 | ||||||||||||||||||
Net Assets: | ||||||||||||||||||||||||||||||||
Beginning of year | $ | 190,707 | $ | 210,583 | $ | 169,968 | $ | 273,026 | $ | 1,895,998 | $ | 1,729,897 | $ | 412,009 | $ | 274,141 | ||||||||||||||||
End of year | $ | 100,105 | $ | 190,707 | $ | 112,417 | $ | 169,968 | $ | 997,898 | $ | 1,895,998 | $ | 156,077 | $ | 412,009 | ||||||||||||||||
Undistributed (Accumulated) Net Investment Income (Loss) | $ | 189 | $ | 4 | $ | 520 | $ | 93 | $ | 2,369 | $ | (411 | ) | $ | 805 | $ | 1,265 | |||||||||||||||
The notes to the financial statements are an integral part of this report.
77
Transamerica Convertible | Transamerica Flexible | |||||||||||||||||||||||||||||||
Transamerica Balanced | Securities | Transamerica Equity | Income | |||||||||||||||||||||||||||||
Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | |||||||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | |||||||||||||||||||||||||
2008 | 2007 | 2008 | 2007 | 2008 | 2007 | 2008 | 2007 | |||||||||||||||||||||||||
Share Activity: | ||||||||||||||||||||||||||||||||
Shares issued: | ||||||||||||||||||||||||||||||||
Class A | 168 | 151 | 1,322 | 397 | 4,098 | 4,226 | 359 | 493 | ||||||||||||||||||||||||
Class B | 93 | 120 | 111 | 66 | 511 | 747 | 214 | 164 | ||||||||||||||||||||||||
Class C | 60 | 49 | 939 | 52 | 552 | 963 | 290 | 372 | ||||||||||||||||||||||||
Class I | 509 | 1,104 | 6,453 | 8,822 | 2,984 | 17,539 | ||||||||||||||||||||||||||
Class T | 64 | 57 | ||||||||||||||||||||||||||||||
321 | 320 | 2,881 | 1,619 | 11,678 | 14,815 | 3,847 | 18,568 | |||||||||||||||||||||||||
Shares issued-reinvested from distributions: | ||||||||||||||||||||||||||||||||
Class A | 95 | 14 | 159 | 29 | 6 | — | 83 | 75 | ||||||||||||||||||||||||
Class B | 104 | 7 | 100 | 24 | — | — | 56 | 77 | ||||||||||||||||||||||||
Class C | 39 | 2 | 55 | 10 | — | — | 38 | 38 | ||||||||||||||||||||||||
Class I | — | — | 3,008 | 1,262 | — | — | 2,167 | 1,912 | ||||||||||||||||||||||||
238 | 23 | 3,322 | 1,325 | 6 | — | 2,344 | 2,102 | |||||||||||||||||||||||||
Shares redeemed: | ||||||||||||||||||||||||||||||||
Class A | (712 | ) | (710 | ) | (784 | ) | (194 | ) | (9,119 | ) | (13,041 | ) | (630 | ) | (781 | ) | ||||||||||||||||
Class B | (893 | ) | (1,310 | ) | (168 | ) | (176 | ) | (3,011 | ) | (5,614 | ) | (585 | ) | (797 | ) | ||||||||||||||||
Class C | (289 | ) | (451 | ) | (235 | ) | (105 | ) | (2,172 | ) | (2,460 | ) | (483 | ) | (762 | ) | ||||||||||||||||
Class I | (465 | ) | (12,760 | ) | (7,429 | ) | (8,395 | ) | (27,886 | ) | (2,524 | ) | ||||||||||||||||||||
Class T | (787 | ) | (1,774 | ) | ||||||||||||||||||||||||||||
(1,894 | ) | (2,471 | ) | (1,652 | ) | (13,235 | ) | (22,518 | ) | (31,284 | ) | (29,584 | ) | (4,864 | ) | |||||||||||||||||
Automatic conversions: | ||||||||||||||||||||||||||||||||
Class A | 1,089 | 421 | 62 | 7 | 4,704 | 2,009 | 351 | 87 | ||||||||||||||||||||||||
Class B | (1,096 | ) | (423 | ) | (62 | ) | (8 | ) | (5,003 | ) | (2,121 | ) | (351 | ) | (87 | ) | ||||||||||||||||
(7 | ) | (2 | ) | — | (1 | ) | (299 | ) | (112 | ) | — | — | ||||||||||||||||||||
Net increase (decrease) in shares outstanding: | ||||||||||||||||||||||||||||||||
Class A | 640 | (124 | ) | 759 | 239 | (311 | ) | (6,806 | ) | 163 | (126 | ) | ||||||||||||||||||||
Class B | (1,792 | ) | 1,606 | (19 | ) | (94 | ) | (7,503 | ) | (6,988 | ) | (666 | ) | (643 | ) | |||||||||||||||||
Class C | (190 | ) | (400 | ) | 759 | (43 | ) | (1,620 | ) | (1,497 | ) | (155 | ) | (352 | ) | |||||||||||||||||
Class I | 3,052 | (10,394 | ) | (976 | ) | 427 | (22,735 | ) | 16,927 | |||||||||||||||||||||||
Class T | (723 | ) | (1,717 | ) | ||||||||||||||||||||||||||||
(1,342 | ) | (2,130 | ) | 4,551 | (10,292 | ) | (11,133 | ) | (16,581 | ) | (23,393 | ) | 15,806 | |||||||||||||||||||
The notes to the financial statements are an integral part of this report.
78
Transamerica Growth | Transamerica High Yield | Transamerica Legg Mason | Transamerica Money | |||||||||||||||||||||||||||||
Opportunities | Bond | Partners All Cap | Market | |||||||||||||||||||||||||||||
Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | |||||||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | |||||||||||||||||||||||||
2008 | 2007 | 2008 | 2007 | 2008 | 2007 | 2008 | 2007 | |||||||||||||||||||||||||
Increase (Decrease) in Net Assets From: | ||||||||||||||||||||||||||||||||
Operations: | ||||||||||||||||||||||||||||||||
Net investment income (loss) | $ | (933 | ) | $ | (2,183 | ) | $ | 37,005 | $ | 26,486 | $ | 532 | $ | (57 | ) | $ | 4,673 | $ | 7,680 | |||||||||||||
Net realized gain (loss)(a) | (20,795 | ) | 91,882 | (9,296 | ) | 3,704 | (1,842 | ) | 15,452 | — | — | |||||||||||||||||||||
Change in unrealized appreciation (depreciation)(b) | (114,155 | ) | 13,074 | (173,227 | ) | (6,944 | ) | (48,557 | ) | 1,843 | — | — | ||||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (135,883 | ) | 102,773 | (145,518 | ) | 23,246 | (49,867 | ) | 17,238 | 4,673 | 7,680 | |||||||||||||||||||||
Distributions to Shareholders: | ||||||||||||||||||||||||||||||||
From net investment income: | ||||||||||||||||||||||||||||||||
Class A | — | — | (2,500 | ) | (2,554 | ) | — | (175 | ) | (2,745 | ) | (3,876 | ) | |||||||||||||||||||
Class B | — | — | (1,008 | ) | (1,470 | ) | — | — | (473 | ) | (966 | ) | ||||||||||||||||||||
Class C | — | — | (574 | ) | (615 | ) | — | — | (539 | ) | (700 | ) | ||||||||||||||||||||
Class I | — | — | (31,427 | ) | (21,811 | ) | — | — | (927 | ) | (2,136 | ) | ||||||||||||||||||||
— | — | (35,509 | ) | (26,450 | ) | — | (175 | ) | (4,684 | ) | (7,678 | ) | ||||||||||||||||||||
From net realized gains: | ||||||||||||||||||||||||||||||||
Class A | — | — | — | — | (4,246 | ) | (7,681 | ) | — | — | ||||||||||||||||||||||
Class B | — | — | — | — | (7,861 | ) | (16,118 | ) | — | — | ||||||||||||||||||||||
Class C | — | — | — | — | (3,130 | ) | (6,121 | ) | — | — | ||||||||||||||||||||||
— | — | — | — | (15,237 | ) | (29,920 | ) | — | — | |||||||||||||||||||||||
Capital Share Transactions: | ||||||||||||||||||||||||||||||||
Proceeds from shares sold: | ||||||||||||||||||||||||||||||||
Class A | 3,902 | 8,951 | 10,846 | 10,896 | 2,542 | 4,462 | 156,262 | 110,732 | ||||||||||||||||||||||||
Class B | 2,025 | 2,481 | 1,083 | 1,207 | 1,618 | 4,191 | 36,830 | 18,357 | ||||||||||||||||||||||||
Class C | 1,293 | 1,087 | 736 | 2,753 | 909 | 1,569 | 72,304 | 17,851 | ||||||||||||||||||||||||
Class I | 1,984 | 7,155 | 241,102 | 61,746 | — | — | 25,560 | 209,116 | ||||||||||||||||||||||||
9,204 | 19,674 | 253,767 | 76,602 | 5,069 | 10,222 | 290,956 | 356,056 | |||||||||||||||||||||||||
Dividends and distributions reinvested: | ||||||||||||||||||||||||||||||||
Class A | — | — | 1,345 | 1,803 | 4,108 | 7,515 | 2,215 | 3,727 | ||||||||||||||||||||||||
Class B | — | — | 502 | 980 | 7,238 | 14,734 | 376 | 893 | ||||||||||||||||||||||||
Class C | — | — | 267 | 358 | 2,816 | 5,461 | 404 | 655 | ||||||||||||||||||||||||
Class I | — | — | 20,457 | 21,811 | — | — | 811 | 2,120 | ||||||||||||||||||||||||
— | — | 22,571 | 24,952 | 14,162 | 27,710 | 3,806 | 7,395 | |||||||||||||||||||||||||
Cost of shares redeemed: | ||||||||||||||||||||||||||||||||
Class A | (14,166 | ) | (20,501 | ) | (14,351 | ) | (21,615 | ) | (15,837 | ) | (17,017 | ) | (115,331 | ) | (98,923 | ) | ||||||||||||||||
Class B | (9,511 | ) | (19,854 | ) | (6,552 | ) | (7,614 | ) | (23,998 | ) | (30,724 | ) | (16,870 | ) | (20,138 | ) | ||||||||||||||||
Class C | (4,474 | ) | (6,452 | ) | (3,074 | ) | (4,201 | ) | (10,843 | ) | (10,089 | ) | (32,353 | ) | (16,155 | ) | ||||||||||||||||
Class I | (45,766 | ) | (75,323 | ) | (11,363 | ) | (64,779 | ) | — | — | (31,716 | ) | (203,029 | ) | ||||||||||||||||||
(73,917 | ) | (122,130 | ) | (35,340 | ) | (98,209 | ) | (50,678 | ) | (57,830 | ) | (196,270 | ) | (338,245 | ) | |||||||||||||||||
Redemption fee: | ||||||||||||||||||||||||||||||||
Class A | 1 | 1 | 1 | — | — | — | — | — | ||||||||||||||||||||||||
1 | 1 | 1 | — | — | — | — | — | |||||||||||||||||||||||||
Automatic conversions: | ||||||||||||||||||||||||||||||||
Class A | 15,592 | 2,209 | 2,666 | 794 | 8,181 | 2,342 | 3,549 | 1,515 | ||||||||||||||||||||||||
Class B | (15,592 | ) | (2,209 | ) | (2,666 | ) | (794 | ) | (8,181 | ) | (2,342 | ) | (3,549 | ) | (1,515 | ) | ||||||||||||||||
— | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Net increase (decrease) in net assets resulting from capital shares transactions | (64,712 | ) | (102,455 | ) | 240,999 | 3,345 | (31,447 | ) | (19,898 | ) | 98,492 | 25,206 | ||||||||||||||||||||
Net Increase (Decrease) in net assets | (200,595 | ) | 318 | 59,972 | 141 | (96,551 | ) | (32,755 | ) | 98,481 | 25,208 | |||||||||||||||||||||
Net Assets: | ||||||||||||||||||||||||||||||||
Beginning of year | $ | 359,467 | $ | 359,149 | $ | 397,977 | $ | 397,836 | $ | 173,774 | $ | 206,529 | $ | 173,403 | $ | 148,195 | ||||||||||||||||
End of year | $ | 158,872 | $ | 359,467 | $ | 457,949 | $ | 397,977 | $ | 77,223 | $ | 173,774 | $ | 271,884 | $ | 173,403 | ||||||||||||||||
Undistributed (Accumulated) Net Investment Income (Loss) | $ | (17 | ) | $ | (17 | ) | $ | 3,067 | $ | 1,537 | $ | 525 | $ | (7 | ) | $ | 83 | $ | 94 | |||||||||||||
The notes to the financial statements are an integral part of this report.
79
Transamerica Growth | Transamerica High Yield | Transamerica Legg Mason | Transamerica Money | |||||||||||||||||||||||||||||
Opportunities | Bond | Partners All Cap | Market | |||||||||||||||||||||||||||||
Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | |||||||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | |||||||||||||||||||||||||
2008 | 2007 | 2008 | 2007 | 2008 | 2007 | 2008 | 2007 | |||||||||||||||||||||||||
Share Activity: | ||||||||||||||||||||||||||||||||
Shares issued: | ||||||||||||||||||||||||||||||||
Class A | 427 | 939 | 1,223 | 1,171 | 183 | 263 | 156,265 | 110,732 | ||||||||||||||||||||||||
Class B | 235 | 288 | 112 | 130 | 128 | 260 | 36,830 | 18,357 | ||||||||||||||||||||||||
Class C | 144 | 125 | 82 | 299 | 73 | 99 | 72,304 | 17,852 | ||||||||||||||||||||||||
Class I | 224 | 796 | 27,503 | 6,700 | — | — | 25,560 | 209,116 | ||||||||||||||||||||||||
1,030 | 2,148 | 28,920 | 8,300 | 384 | 622 | 290,959 | 356,057 | |||||||||||||||||||||||||
Shares issued-reinvested from distributions: | ||||||||||||||||||||||||||||||||
Class A | — | — | 223 | 196 | 271 | 462 | 2,215 | 3,727 | ||||||||||||||||||||||||
Class B | — | — | 78 | 106 | 513 | 960 | 376 | 893 | ||||||||||||||||||||||||
Class C | — | — | 41 | 39 | 199 | 355 | 404 | 655 | ||||||||||||||||||||||||
Class I | — | — | 3,829 | 2,352 | — | — | 811 | 2,120 | ||||||||||||||||||||||||
— | — | 4,171 | 2,693 | 983 | 1,777 | 3,806 | 7,395 | |||||||||||||||||||||||||
Shares redeemed: | ||||||||||||||||||||||||||||||||
Class A | (1,569 | ) | (2,247 | ) | (1,734 | ) | (2,333 | ) | (1,145 | ) | (997 | ) | (115,331 | ) | (98,924 | ) | ||||||||||||||||
Class B | (1,105 | ) | (2,313 | ) | (787 | ) | (826 | ) | (1,867 | ) | (1,916 | ) | (16,870 | ) | (20,138 | ) | ||||||||||||||||
Class C | (529 | ) | (749 | ) | (380 | ) | (455 | ) | (835 | ) | (632 | ) | (32,353 | ) | (16,155 | ) | ||||||||||||||||
Class I | (5,248 | ) | (8,408 | ) | (1,605 | ) | (7,039 | ) | — | — | (31,716 | ) | (203,029 | ) | ||||||||||||||||||
(8,451 | ) | (13,717 | ) | (4,506 | ) | (10,653 | ) | (3,847 | ) | (3,545 | ) | (196,270 | ) | (338,246 | ) | |||||||||||||||||
Automatic conversions: | ||||||||||||||||||||||||||||||||
Class A | 1,695 | 231 | 310 | 86 | 595 | 136 | 3,549 | 1,515 | ||||||||||||||||||||||||
Class B | (1,809 | ) | (245 | ) | (310 | ) | (86 | ) | (641 | ) | (145 | ) | (3,549 | ) | (1,515 | ) | ||||||||||||||||
(114 | ) | (14 | ) | — | — | (46 | ) | (9 | ) | — | — | |||||||||||||||||||||
Net increase (decrease) in shares outstanding: | ||||||||||||||||||||||||||||||||
Class A | 553 | (1,077 | ) | 22 | (880 | ) | (96 | ) | (136 | ) | 46,698 | 17,050 | ||||||||||||||||||||
Class B | (2,679 | ) | (2,270 | ) | (907 | ) | (676 | ) | (1,867 | ) | (841 | ) | 16,787 | (2,403 | ) | |||||||||||||||||
Class C | (385 | ) | (624 | ) | (257 | ) | (117 | ) | (563 | ) | (178 | ) | 40,355 | 2,352 | ||||||||||||||||||
Class I | (5,024 | ) | (7,612 | ) | 29,727 | 2,013 | — | — | (5,345 | ) | 8,207 | |||||||||||||||||||||
(7,535 | ) | (11,583 | ) | 28,585 | 340 | (2,526 | ) | (1,155 | ) | 98,495 | 25,206 | |||||||||||||||||||||
The notes to the financial statements are an integral part of this report.
80
Transamerica Science & | Transamerica Short-Term | Transamerica Small/Mid | Transamerica Templeton | |||||||||||||||||||||||||||||
Technology | Bond | Cap Value | Global | |||||||||||||||||||||||||||||
Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | |||||||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | |||||||||||||||||||||||||
2008 | 2007 | 2008 | 2007 | 2008 | 2007 | 2008 | 2007 | |||||||||||||||||||||||||
Increase (Decrease) in Net Assets From: | ||||||||||||||||||||||||||||||||
Operations: | ||||||||||||||||||||||||||||||||
Net investment income (loss) | $ | (434 | ) | $ | (423 | ) | $ | 24,879 | $ | 24,122 | $ | 9,308 | $ | 6,180 | $ | 1,486 | $ | 1,081 | ||||||||||||||
Net realized gain (loss)(a) | (563 | ) | 4,033 | (10,141 | ) | (1,455 | ) | (98,519 | ) | 77,381 | 11,223 | 21,798 | ||||||||||||||||||||
Change in unrealized appreciation (depreciation)(b) | (48,013 | ) | 27,561 | (19,826 | ) | (1,233 | ) | (296,332 | ) | 101,180 | (105,619 | ) | 31,307 | |||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (49,010 | ) | 31,171 | (5,088 | ) | 21,434 | (385,543 | ) | 184,741 | (92,910 | ) | 54,186 | ||||||||||||||||||||
Distributions to Shareholders: | ||||||||||||||||||||||||||||||||
From net investment income: | ||||||||||||||||||||||||||||||||
Class A | — | — | (73 | ) | — | (815 | ) | (339 | ) | (1,124 | ) | (1,297 | ) | |||||||||||||||||||
Class B | — | — | — | — | — | (99 | ) | (375 | ) | |||||||||||||||||||||||
Class C | — | — | (74 | ) | — | (207 | ) | (64 | ) | (199 | ) | (173 | ) | |||||||||||||||||||
Class I | — | — | (24,970 | ) | (22,977 | ) | (4,881 | ) | (6,046 | ) | (700 | ) | (688 | ) | ||||||||||||||||||
— | — | (25,117 | ) | (22,977 | ) | (5,903 | ) | (6,449 | ) | (2,122 | ) | (2,533 | ) | |||||||||||||||||||
From net realized gains: | ||||||||||||||||||||||||||||||||
Class A | (282 | ) | — | — | — | (12,319 | ) | (849 | ) | — | — | |||||||||||||||||||||
Class B | (157 | ) | — | — | — | (5,719 | ) | (821 | ) | — | — | |||||||||||||||||||||
Class C | (96 | ) | — | — | — | (7,564 | ) | (535 | ) | — | — | |||||||||||||||||||||
Class I | (2,576 | ) | — | — | — | (50,781 | ) | (8,419 | ) | — | — | |||||||||||||||||||||
(3,111 | ) | — | — | — | (76,383 | ) | (10,624 | ) | — | — | ||||||||||||||||||||||
Capital Share Transactions: | ||||||||||||||||||||||||||||||||
Proceeds from shares sold: | ||||||||||||||||||||||||||||||||
Class A | 2,918 | 1,923 | 6,797 | — | 376,986 | 50,011 | 4,616 | 6,194 | ||||||||||||||||||||||||
Class B | 381 | 488 | — | — | 18,229 | 7,596 | 1,618 | 3,166 | ||||||||||||||||||||||||
Class C | 660 | 689 | 8,910 | — | 111,684 | 29,511 | 900 | 1,684 | ||||||||||||||||||||||||
Class I | 4,896 | — | 34,605 | 193,918 | 40,971 | 23,041 | — | — | ||||||||||||||||||||||||
8,855 | 3,100 | 50,312 | 193,918 | 547,870 | 110,159 | 7,134 | 11,044 | |||||||||||||||||||||||||
Dividends and distributions reinvested: | ||||||||||||||||||||||||||||||||
Class A | 268 | — | 27 | — | 10,992 | 1,137 | 1,085 | 1,262 | ||||||||||||||||||||||||
Class B | 149 | — | — | — | 5,175 | 750 | 94 | 356 | ||||||||||||||||||||||||
Class C | 78 | — | 29 | — | 6,054 | 502 | 189 | 164 | ||||||||||||||||||||||||
Class I | 2,576 | — | 19,101 | 22,977 | 55,662 | 14,464 | 700 | 688 | ||||||||||||||||||||||||
3,071 | — | 19,157 | 22,977 | 77,883 | 16,853 | 2,068 | 2,470 | |||||||||||||||||||||||||
Cost of shares redeemed: | ||||||||||||||||||||||||||||||||
Class A | (3,212 | ) | (1,961 | ) | (923 | ) | — | (137,493 | ) | (21,331 | ) | (21,738 | ) | (39,581 | ) | |||||||||||||||||
Class B | (821 | ) | (1,317 | ) | — | — | (10,337 | ) | (14,052 | ) | (8,972 | ) | (19,012 | ) | ||||||||||||||||||
Class C | (625 | ) | (712 | ) | (1,386 | ) | — | (21,818 | ) | (7,577 | ) | (5,417 | ) | (8,953 | ) | |||||||||||||||||
Class I | (1,428 | ) | — | (95,587 | ) | (30,905 | ) | (148,685 | ) | (152,163 | ) | (38,070 | ) | (3,733 | ) | |||||||||||||||||
(6,086 | ) | (3,990 | ) | (97,896 | ) | (30,905 | ) | (318,333 | ) | (195,123 | ) | (74,197 | ) | (71,279 | ) | |||||||||||||||||
Redemption fee: | ||||||||||||||||||||||||||||||||
Class A | — | — | 2 | — | 2 | — | — | 1 | ||||||||||||||||||||||||
Class B | — | — | — | — | — | 2 | — | — | ||||||||||||||||||||||||
— | — | 2 | — | 2 | 2 | — | 1 | |||||||||||||||||||||||||
Automatic conversions: | ||||||||||||||||||||||||||||||||
Class A | 186 | 31 | — | — | 7,300 | 1,995 | 30,467 | 9,939 | ||||||||||||||||||||||||
Class B | (186 | ) | (31 | ) | — | — | (7,300 | ) | (1,995 | ) | (30,467 | ) | (9,939 | ) | ||||||||||||||||||
— | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Net increase (decrease) in net assets resulting from capital shares transactions | 5,840 | (890 | ) | (28,425 | ) | 185,990 | 307,422 | (68,109 | ) | (64,995 | ) | (57,764 | ) | |||||||||||||||||||
Net Increase (Decrease) in net assets | (46,281 | ) | 30,281 | (58,630 | ) | 184,447 | (160,407 | ) | 99,559 | (160,027 | ) | (6,111 | ) | |||||||||||||||||||
Net Assets: | ||||||||||||||||||||||||||||||||
Beginning of year | $ | 99,792 | $ | 69,511 | $ | 563,889 | $ | 379,442 | $ | 701,413 | $ | 601,854 | $ | 258,780 | $ | 264,891 | ||||||||||||||||
End of year | $ | 53,511 | $ | 99,792 | $ | 505,259 | $ | 563,889 | $ | 541,006 | $ | 701,413 | $ | 98,753 | $ | 258,780 | ||||||||||||||||
Undistributed (Accumulated) Net Investment Income (Loss) | $ | (2 | ) | $ | (2 | ) | $ | 1,333 | $ | 1,571 | $ | 7,851 | $ | 5,056 | $ | 421 | $ | 337 | ||||||||||||||
The notes to the financial statements are an integral part of this report.
81
Transamerica Science & | Transamerica Short-Term | Transamerica Small/Mid | Transamerica Templeton | |||||||||||||||||||||||||||||
Technology | Bond | Cap Value | Global | |||||||||||||||||||||||||||||
Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | Year Ended | |||||||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | October 31, | |||||||||||||||||||||||||
2008 | 2007 | 2008 | 2007 | 2008 | 2007 | 2008 | 2007 | |||||||||||||||||||||||||
Share Activity: | ||||||||||||||||||||||||||||||||
Shares issued: | ||||||||||||||||||||||||||||||||
Class A | 616 | 404 | 689 | — | 20,500 | 2,339 | 148 | 197 | ||||||||||||||||||||||||
Class B | 92 | 110 | — | — | 1,013 | 385 | 61 | 108 | ||||||||||||||||||||||||
Class C | 154 | 149 | 908 | — | 6,200 | 1,464 | 32 | 57 | ||||||||||||||||||||||||
Class I | 1,201 | — | 2,942 | 19,678 | 3,081 | 1,173 | — | — | ||||||||||||||||||||||||
2,063 | 663 | 4,539 | 19,678 | 30,794 | 5,361 | 241 | 362 | |||||||||||||||||||||||||
Shares issued-reinvested from distributions: | ||||||||||||||||||||||||||||||||
Class A | 53 | — | 6 | — | 553 | 62 | 35 | 42 | ||||||||||||||||||||||||
Class B | 31 | — | — | — | 270 | 43 | 3 | 12 | ||||||||||||||||||||||||
Class C | 16 | — | 6 | — | 318 | 29 | 6 | 6 | ||||||||||||||||||||||||
Class I | 501 | — | 2,571 | 2,340 | 2,787 | 797 | 20 | 23 | ||||||||||||||||||||||||
601 | — | 2,583 | 2,340 | 3,928 | 931 | 64 | 83 | |||||||||||||||||||||||||
Shares redeemed: | ||||||||||||||||||||||||||||||||
Class A | (774 | ) | (461 | ) | (95 | ) | — | (9,819 | ) | (1,076 | ) | (749 | ) | (1,245 | ) | |||||||||||||||||
Class B | (202 | ) | (318 | ) | — | — | (609 | ) | (745 | ) | (315 | ) | (645 | ) | ||||||||||||||||||
Class C | (161 | ) | (177 | ) | (143 | ) | — | (1,406 | ) | (395 | ) | (198 | ) | (303 | ) | |||||||||||||||||
Class I | (394 | ) | — | (9,914 | ) | (3,135 | ) | (9,530 | ) | (8,356 | ) | (1,260 | ) | (124 | ) | |||||||||||||||||
(1,531 | ) | (956 | ) | (10,152 | ) | (3,135 | ) | (21,364 | ) | (10,572 | ) | (2,522 | ) | (2,317 | ) | |||||||||||||||||
Automatic conversions: | ||||||||||||||||||||||||||||||||
Class A | 47 | 7 | — | — | 385 | 96 | 1,006 | 312 | ||||||||||||||||||||||||
Class B | (50 | ) | (7 | ) | — | — | (400 | ) | (100 | ) | (1,071 | ) | (332 | ) | ||||||||||||||||||
(3 | ) | — | — | — | (15 | ) | (4 | ) | (65 | ) | (20 | ) | ||||||||||||||||||||
Net increase (decrease) in shares outstanding: | ||||||||||||||||||||||||||||||||
Class A | (58 | ) | (50 | ) | 600 | — | 11,619 | 1,421 | 440 | (694 | ) | |||||||||||||||||||||
Class B | (129 | ) | (215 | ) | — | — | 274 | (417 | ) | (1,322 | ) | (857 | ) | |||||||||||||||||||
Class C | 9 | (28 | ) | 771 | — | 5,112 | 1,098 | (160 | ) | (240 | ) | |||||||||||||||||||||
Class I | 1,308 | — | (4,401 | ) | 18,883 | (3,662 | ) | (6,386 | ) | (1,240 | ) | (101 | ) | |||||||||||||||||||
1,130 | (293 | ) | (3,030 | ) | 18,883 | 13,343 | (4,284 | ) | (2,282 | ) | (1,892 | ) | ||||||||||||||||||||
The notes to the financial statements are an integral part of this report.
82
Transamerica Value | ||||||||
Balanced | ||||||||
Year Ended | Year Ended | |||||||
October 31, | October 31, | |||||||
2008 | 2007 | |||||||
Increase (Decrease) in Net Assets From: | ||||||||
Operations: | ||||||||
Net investment income | $ | 1,068 | $ | 1,133 | ||||
Net realized gain (loss)(a) | (3,730 | ) | 4,199 | |||||
Change in unrealized appreciation (depreciation)(b) | (14,696 | ) | 2,184 | |||||
Net increase (decrease) in net assets resulting from operations | (17,358 | ) | 7,516 | |||||
Distributions to Shareholders: | ||||||||
From net investment income: | ||||||||
Class A | (692 | ) | (537 | ) | ||||
Class B | (196 | ) | (205 | ) | ||||
Class C | (172 | ) | (131 | ) | ||||
(1,060 | ) | (873 | ) | |||||
From net realized gains: | ||||||||
Class A | (1,609 | ) | (898 | ) | ||||
Class B | (830 | ) | (564 | ) | ||||
Class C | (566 | ) | (319 | ) | ||||
(3,005 | ) | (1,781 | ) | |||||
Capital Share Transactions: | ||||||||
Proceeds from shares sold: | ||||||||
Class A | 1,496 | 2,339 | ||||||
Class B | 511 | 1,826 | ||||||
Class C | 374 | 1,172 | ||||||
2,381 | 5,337 | |||||||
Dividends and distributions reinvested: | ||||||||
Class A | 2,069 | 1,403 | ||||||
Class B | 909 | 725 | ||||||
Class C | 669 | 437 | ||||||
3,647 | 2,565 | |||||||
Cost of shares redeemed: | ||||||||
Class A | (8,353 | ) | (8,665 | ) | ||||
Class B | (4,161 | ) | (4,679 | ) | ||||
Class C | (2,846 | ) | (2,140 | ) | ||||
(15,360 | ) | (15,484 | ) | |||||
Redemption fee: | ||||||||
Class B | 1 | — | ||||||
1 | — | |||||||
Automatic conversions: | ||||||||
Class A | 3,193 | 2,221 | ||||||
Class B | (3,193 | ) | (2,221 | ) | ||||
— | — | |||||||
Net decrease in net assets resulting from capital shares transactions | (9,331 | ) | (7,582 | ) | ||||
Net Decrease in net assets | (30,754 | ) | (2,720 | ) | ||||
Net Assets: | ||||||||
Beginning of year | $ | 61,667 | $ | 64,387 | ||||
End of year | $ | 30,913 | $ | 61,667 | ||||
Undistributed Net Investment Income | $ | 349 | $ | 260 | ||||
The notes to the financial statements are an integral part of this report.
83
Transamerica Value | ||||||||
Balanced | ||||||||
Year Ended | Year Ended | |||||||
October 31, | October 31, | |||||||
2008 | 2007 | |||||||
Share Activity: | ||||||||
Shares issued: | ||||||||
Class A | 112 | 171 | ||||||
Class B | 39 | 134 | ||||||
Class C | 29 | 87 | ||||||
180 | 392 | |||||||
Shares issued-reinvested from distributions: | ||||||||
Class A | 176 | 106 | ||||||
Class B | 74 | 55 | ||||||
Class C | 56 | 33 | ||||||
306 | 194 | |||||||
Shares redeemed: | ||||||||
Class A | (713 | ) | (636 | ) | ||||
Class B | (351 | ) | (344 | ) | ||||
Class C | (243 | ) | (158 | ) | ||||
(1,307 | ) | (1,138 | ) | |||||
Automatic conversions: | ||||||||
Class A | 261 | 162 | ||||||
Class B | (262 | ) | (163 | ) | ||||
(1 | ) | (1 | ) | |||||
Net decrease in shares outstanding: | ||||||||
Class A | (164 | ) | (197 | ) | ||||
Class B | (500 | ) | (318 | ) | ||||
Class C | (158 | ) | (38 | ) | ||||
(822 | ) | (553 | ) | |||||
(a) | Net realized and unrealized gain (loss) includes Investment Securities, Futures Contracts, Written Options and Swaptions, Swaps and Foreign Currency Transactions. | |
(b) | Change in unrealized appreciation (depreciation) includes Investment Securities, Futures Contracts, Written Options and Swaptions, Swaps and Foreign Currency Translation. |
The notes to the financial statements are an integral part of this report.
84
FINANCIAL HIGHLIGHTS
For the years ended;
For the years ended;
Transamerica Balanced | ||||||||||||||||||||
Class A | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 25.70 | $ | 22.05 | $ | 19.90 | $ | 18.53 | $ | 17.43 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.28 | 0.17 | 0.12 | 0.15 | 0.14 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (8.64 | ) | 3.62 | 2.12 | 1.41 | 1.08 | ||||||||||||||
Total from investment operations | (8.36 | ) | 3.79 | 2.24 | 1.56 | 1.22 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.24 | ) | (0.14 | ) | (0.09 | ) | (0.19 | ) | (0.12 | ) | ||||||||||
Net realized gains on investments | (0.66 | ) | — | — | — | — | ||||||||||||||
Total distributions | (0.90 | ) | (0.14 | ) | (0.09 | ) | (0.19 | ) | (0.12 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 16.44 | $ | 25.70 | $ | 22.05 | $ | 19.90 | $ | 18.53 | ||||||||||
Total Return(b) | (33.55 | )% | 17.28 | % | 11.27 | % | 8.41 | % | 7.03 | % | ||||||||||
Net Assets End of Year | $ | 49,917 | $ | 61,565 | $ | 55,547 | $ | 62,440 | $ | 72,997 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 1.52 | % | 1.56 | % | 1.58 | % | 1.59 | % | 1.70 | % | ||||||||||
Before reimbursement/fee waiver | 1.52 | % | 1.56 | % | 1.58 | % | 1.59 | % | 1.70 | % | ||||||||||
Net investment income, to average net assets(c) | 1.27 | % | 0.73 | % | 0.57 | % | 0.75 | % | 0.76 | % | ||||||||||
Portfolio turnover rate | 52 | % | 52 | % | 51 | % | 27 | % | 107 | % |
Transamerica Balanced | ||||||||||||||||||||
Class B | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 25.58 | $ | 21.98 | $ | 19.88 | $ | 18.47 | $ | 17.39 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.13 | 0.04 | — | (d) | 0.04 | 0.04 | ||||||||||||||
Net realized and unrealized gain (loss) on investments | (8.58 | ) | 3.60 | 2.12 | 1.40 | 1.08 | ||||||||||||||
Total from investment operations | (8.45 | ) | 3.64 | 2.12 | 1.44 | 1.12 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.10 | ) | (0.04 | ) | (0.02 | ) | (0.03 | ) | (0.04 | ) | ||||||||||
Net realized gains on investments | (0.66 | ) | — | — | — | — | ||||||||||||||
Total distributions | (0.76 | ) | (0.04 | ) | (0.02 | ) | (0.03 | ) | (0.04 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 16.37 | $ | 25.58 | $ | 21.98 | $ | 19.88 | $ | 18.47 | ||||||||||
Total Return(b) | (33.95 | )% | 16.57 | % | 10.65 | % | 7.80 | % | 6.44 | % | ||||||||||
Net Assets End of Year | $ | 32,469 | $ | 96,573 | $ | 118,286 | $ | 142,479 | $ | 170,630 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.15 | % | 2.14 | % | 2.15 | % | 2.14 | % | 2.26 | % | ||||||||||
Before reimbursement/fee waiver | 2.15 | % | 2.14 | % | 2.15 | % | 2.14 | % | 2.26 | % | ||||||||||
Net investment income, to average net assets(c) | 0.59 | % | 0.15 | % | 0.01 | % | 0.20 | % | 0.19 | % | ||||||||||
Portfolio turnover rate | 52 | % | 52 | % | 51 | % | 27 | % | 107 | % |
The notes to the financial statements are an integral part of this report.
85
Transamerica Balanced | ||||||||||||||||||||
Class C | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 25.50 | $ | 21.91 | $ | 19.82 | $ | 18.45 | $ | 17.39 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income (loss)(a) | 0.15 | 0.04 | 0.01 | 0.04 | (0.01 | ) | ||||||||||||||
Net realized and unrealized gain (loss) on investments | (8.56 | ) | 3.59 | 2.10 | 1.41 | 1.11 | ||||||||||||||
Total from investment operations | (8.41 | ) | 3.63 | 2.11 | 1.45 | 1.10 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.13 | ) | (0.04 | ) | (0.02 | ) | (0.08 | ) | (0.04 | ) | ||||||||||
Net realized gains on investments | (0.66 | ) | — | — | — | — | ||||||||||||||
Total distributions | (0.79 | ) | (0.04 | ) | (0.02 | ) | (0.08 | ) | (0.04 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 16.30 | $ | 25.50 | $ | 21.91 | $ | 19.82 | $ | 18.45 | ||||||||||
Total Return(b) | (33.92 | )% | 16.61 | % | 10.64 | % | 7.85 | % | 6.33 | % | ||||||||||
Net Assets End of Year | $ | 17,719 | $ | 32,569 | $ | 36,750 | $ | 43,276 | $ | 53,990 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.08 | % | 2.11 | % | 2.12 | % | 2.13 | % | 2.28 | % | ||||||||||
Before reimbursement/fee waiver | 2.08 | % | 2.11 | % | 2.12 | % | 2.13 | % | 2.28 | % | ||||||||||
Net investment income (loss), to average net assets(c) | 0.69 | % | 0.18 | % | 0.03 | % | 0.21 | % | (0.08 | )% | ||||||||||
Portfolio turnover rate | 52 | % | 52 | % | 51 | % | 27 | % | 107 | % |
Transamerica Convertible Securities | ||||||||||||||||||||
Class A | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 15.30 | $ | 12.76 | $ | 11.56 | $ | 11.00 | $ | 11.32 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.13 | 0.10 | 0.07 | 0.20 | 0.21 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (4.92 | ) | 3.22 | 1.33 | 0.81 | 0.56 | ||||||||||||||
Total from investment operations | (4.79 | ) | 3.32 | 1.40 | 1.01 | 0.77 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.10 | ) | (0.11 | ) | (0.07 | ) | (0.20 | ) | (0.22 | ) | ||||||||||
Net realized gains on investments | (3.23 | ) | (0.67 | ) | (0.13 | ) | (0.25 | ) | (0.87 | ) | ||||||||||
Total distributions | (3.33 | ) | (0.78 | ) | (0.20 | ) | (0.45 | ) | (1.09 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 7.18 | $ | 15.30 | $ | 12.76 | $ | 11.56 | $ | 11.00 | ||||||||||
Total Return(b) | (38.92 | )% | 27.41 | % | 12.15 | % | 9.24 | % | 7.06 | % | ||||||||||
Net Assets End of Year | $ | 10,748 | $ | 11,276 | $ | 6,350 | $ | 209,374 | $ | 188,049 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 1.33 | % | 1.33 | % | 1.25 | % | 1.17 | % | 1.20 | % | ||||||||||
Before reimbursement/fee waiver | 1.33 | % | 1.33 | % | 1.25 | % | 1.17 | % | 1.20 | % | ||||||||||
Net investment income, to average net assets(c) | 1.23 | % | 0.75 | % | 0.59 | % | 1.74 | % | 1.83 | % | ||||||||||
Portfolio turnover rate | 91 | % | 92 | % | 69 | % | 87 | % | 157 | % |
The notes to the financial statements are an integral part of this report.
86
Transamerica Convertible Securities | ||||||||||||||||||||
Class B | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 15.22 | $ | 12.71 | $ | 11.54 | $ | 11.00 | $ | 11.31 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.04 | 0.01 | — | (d) | 0.09 | 0.14 | ||||||||||||||
Net realized and unrealized gain (loss) on investments | (4.87 | ) | 3.21 | 1.32 | 0.80 | 0.57 | ||||||||||||||
Total from investment operations | (4.83 | ) | 3.22 | 1.32 | 0.89 | 0.71 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.03 | ) | (0.04 | ) | (0.02 | ) | (0.10 | ) | (0.15 | ) | ||||||||||
Net realized gains on investments | (3.23 | ) | (0.67 | ) | (0.13 | ) | (0.25 | ) | (0.87 | ) | ||||||||||
Total distributions | (3.26 | ) | (0.71 | ) | (0.15 | ) | (0.35 | ) | (1.02 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 7.13 | $ | 15.22 | $ | 12.71 | $ | 11.54 | $ | 11.00 | ||||||||||
Total Return(b) | (39.32 | )% | 26.54 | % | 11.47 | % | 8.09 | % | 6.52 | % | ||||||||||
Net Assets End of Year | $ | 2,920 | $ | 6,533 | $ | 6,651 | $ | 6,656 | $ | 6,379 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.02 | % | 1.99 | % | 1.99 | % | 2.15 | % | 1.79 | % | ||||||||||
Before reimbursement/fee waiver | 2.02 | % | 1.99 | % | 1.99 | % | 2.15 | % | 1.79 | % | ||||||||||
Net investment income, to average net assets(c) | 0.40 | % | 0.10 | % | — | %(e) | 0.76 | % | 1.24 | % | ||||||||||
Portfolio turnover rate | 91 | % | 92 | % | 69 | % | 87 | % | 157 | % |
Transamerica Convertible Securities | ||||||||||||||||||||
Class C | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 15.17 | $ | 12.66 | $ | 11.50 | $ | 10.97 | $ | 11.31 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.07 | 0.02 | — | (d) | 0.08 | 0.11 | ||||||||||||||
Net realized and unrealized gain (loss) on investments | (4.87 | ) | 3.20 | 1.31 | 0.82 | 0.57 | ||||||||||||||
Total from investment operations | (4.80 | ) | 3.22 | 1.31 | 0.90 | 0.68 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.04 | ) | (0.04 | ) | (0.02 | ) | (0.12 | ) | (0.15 | ) | ||||||||||
Net realized gains on investments | (3.23 | ) | (0.67 | ) | (0.13 | ) | (0.25 | ) | (0.87 | ) | ||||||||||
Total distributions | (3.27 | ) | (0.71 | ) | (0.15 | ) | (0.37 | ) | (1.02 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 7.10 | $ | 15.17 | $ | 12.66 | $ | 11.50 | $ | 10.97 | ||||||||||
Total Return(b) | (39.24 | )% | 26.69 | % | 11.44 | % | 8.17 | % | 6.33 | % | ||||||||||
Net Assets End of Year | $ | 7,070 | $ | 3,598 | $ | 3,551 | $ | 4,465 | $ | 5,204 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 1.94 | % | 1.94 | % | 1.94 | % | 2.16 | % | 2.05 | % | ||||||||||
Before reimbursement/fee waiver | 1.94 | % | 1.94 | % | 1.94 | % | 2.16 | % | 2.05 | % | ||||||||||
Net investment income, to average net assets(c) | 0.72 | % | 0.15 | % | 0.02 | % | 0.73 | % | 0.98 | % | ||||||||||
Portfolio turnover rate | 91 | % | 92 | % | 69 | % | 87 | % | 157 | % |
The notes to the financial statements are an integral part of this report.
87
Transamerica Convertible Securities | ||||||||||||
Class I | ||||||||||||
October 31, | October 31, | October 31, | ||||||||||
2008 | 2007 | 2006(f) | ||||||||||
Net Asset Value | ||||||||||||
Beginning of year | $ | 15.31 | $ | 12.76 | $ | 11.71 | ||||||
Investment Operations | ||||||||||||
Net investment income(a) | 0.18 | 0.16 | 0.14 | |||||||||
Net realized and unrealized gain (loss) on investments | (4.92 | ) | 3.23 | 1.17 | ||||||||
Total from investment operations | (4.74 | ) | 3.39 | 1.31 | ||||||||
Distributions | ||||||||||||
Net investment income | (0.15 | ) | (0.17 | ) | (0.13 | ) | ||||||
Net realized gains on investments | (3.23 | ) | (0.67 | ) | (0.13 | ) | ||||||
Total distributions | (3.38 | ) | (0.84 | ) | (0.26 | ) | ||||||
Net Asset Value | ||||||||||||
End of year | $ | 7.19 | $ | 15.31 | $ | 12.76 | ||||||
Total Return(b) | (38.58 | )% | 28.10 | % | 11.26% | (g) | ||||||
Net Assets End of Year | $ | 91,679 | $ | 148,562 | $ | 256,474 | ||||||
Ratio and Supplemental Data | ||||||||||||
Expenses to average net assets | ||||||||||||
After reimbursement/fee waiver | 0.84 | % | 0.82 | % | 0.82 | %(h) | ||||||
Before reimbursement/fee waiver | 0.84 | % | 0.82 | % | 0.82 | %(h) | ||||||
Net investment income, to average net assets(c) | 1.65 | % | 1.24 | % | 1.20 | %(h) | ||||||
Portfolio turnover rate | 91 | % | 92 | % | 69 | %(g) |
Transamerica Equity | ||||||||||||||||||||
Class A | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 12.07 | $ | 9.83 | $ | 8.87 | $ | 7.44 | $ | 6.86 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment loss(a) | (0.01 | ) | (0.05 | ) | (0.07 | ) | (0.02 | ) | (0.07 | ) | ||||||||||
Net realized and unrealized gain (loss) on investments | (5.21 | ) | 2.29 | 1.11 | 1.58 | 0.65 | ||||||||||||||
Total from investment operations | (5.22 | ) | 2.24 | 1.04 | 1.56 | 0.58 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net realized gains on investments | — | — | (0.08 | ) | (0.13 | ) | — | |||||||||||||
Total distributions | — | — | (0.08 | ) | (0.13 | ) | — | |||||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 6.85 | $ | 12.07 | $ | 9.83 | $ | 8.87 | $ | 7.44 | ||||||||||
Total Return(b) | (43.25) | % | 22.79 | % | 11.71 | % | 21.16 | % | 8.45 | % | ||||||||||
Net Assets End of Year | $ | 300,140 | $ | 532,251 | $ | 500,483 | $ | 301,635 | $ | 176,851 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 1.39 | % | 1.40 | % | 1.51 | % | 1.36 | % | 1.50 | % | ||||||||||
Before reimbursement/fee waiver | 1.39 | % | 1.40 | % | 1.51 | % | 1.36 | % | 1.50 | % | ||||||||||
Net investment loss, to average net assets(c) | (0.07 | )% | (0.48 | )% | (0.70 | )% | (0.27 | )% | (0.90 | )% | ||||||||||
Portfolio turnover rate | 33 | % | 62 | % | 19 | % | 39 | % | 97 | % |
The notes to the financial statements are an integral part of this report.
88
Transamerica Equity | ||||||||||||||||||||
Class B | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 11.39 | $ | 9.35 | $ | 8.49 | $ | 7.19 | $ | 6.68 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment loss(a) | (0.08 | ) | (0.12 | ) | (0.12 | ) | (0.08 | ) | (0.11 | ) | ||||||||||
Net realized and unrealized gain (loss) on investments | (4.89 | ) | 2.16 | 1.06 | 1.51 | 0.62 | ||||||||||||||
Total from investment operations | (4.97 | ) | 2.04 | 0.94 | 1.43 | 0.51 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net realized gains on investments | — | — | (0.08 | ) | (0.13 | ) | — | |||||||||||||
Total distributions | — | — | (0.08 | ) | (0.13 | ) | — | |||||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 6.42 | $ | 11.39 | $ | 9.35 | $ | 8.49 | $ | 7.19 | ||||||||||
Total Return(b) | (43.63 | )% | 21.82 | % | 11.06 | % | 20.03 | % | 7.68 | % | ||||||||||
Net Assets End of Year | $ | 59,479 | $ | 191,007 | $ | 222,144 | $ | 49,865 | $ | 47,928 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.17 | % | 2.17 | % | 2.17 | % | 2.18 | % | 2.20 | % | ||||||||||
Before reimbursement/fee waiver | 2.21 | % | 2.21 | % | 2.34 | % | 2.61 | % | 2.72 | % | ||||||||||
Net investment loss, to average net assets(c) | (0.87 | )% | (1.25 | )% | (1.34 | )% | (0.99 | )% | (1.62 | )% | ||||||||||
Portfolio turnover rate | 33 | % | 62 | % | 19 | % | 39 | % | 97 | % |
Transamerica Equity | ||||||||||||||||||||
Class C | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 11.42 | $ | 9.37 | $ | 8.50 | $ | 7.20 | $ | 6.68 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment loss(a) | (0.07 | ) | (0.11 | ) | (0.12 | ) | (0.08 | ) | (0.11 | ) | ||||||||||
Net realized and unrealized gain (loss) on investments | (4.91 | ) | 2.16 | 1.07 | 1.51 | 0.63 | ||||||||||||||
Total from investment operations | (4.98 | ) | 2.05 | 0.95 | 1.43 | 0.52 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net realized gains on investments | — | — | (0.08 | ) | (0.13 | ) | — | |||||||||||||
Total distributions | — | — | (0.08 | ) | (0.13 | ) | — | |||||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 6.44 | $ | 11.42 | $ | 9.37 | $ | 8.50 | $ | 7.20 | ||||||||||
Total Return(b) | (43.61 | )% | 21.88 | % | 11.16 | % | 20.05 | % | 7.78 | % | ||||||||||
Net Assets End of Year | $ | 46,676 | $ | 101,226 | $ | 97,047 | $ | 23,656 | $ | 21,808 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.04 | % | 2.07 | % | 2.10 | % | 2.18 | % | 2.20 | % | ||||||||||
Before reimbursement/fee waiver | 2.04 | % | 2.07 | % | 2.10 | % | 2.31 | % | 2.55 | % | ||||||||||
Net investment loss, to average net assets(c) | (0.72 | )% | (1.15 | )% | (1.27 | )% | (1.00 | )% | (1.63 | )% | ||||||||||
Portfolio turnover rate | 33 | % | 62 | % | 19 | % | 39 | % | 97 | % |
The notes to the financial statements are an integral part of this report.
89
Transamerica Equity | ||||||||||||
Class I | ||||||||||||
October 31, | October 31, | October 31, | ||||||||||
2008 | 2007 | 2006(f) | ||||||||||
Net Asset Value | ||||||||||||
Beginning of year | $ | 12.23 | $ | 9.90 | $ | 9.17 | ||||||
Investment Operations | ||||||||||||
Net investment income(a) | 0.06 | 0.01 | — | (d) | ||||||||
Net realized and unrealized gain (loss) on investments | (5.30 | ) | 2.32 | 0.81 | ||||||||
Total from investment operations | (5.24 | ) | 2.33 | 0.81 | ||||||||
Distributions | ||||||||||||
Net realized gains on investments | — | — | (0.08 | ) | ||||||||
Total distributions | — | — | (0.08 | ) | ||||||||
Net Asset Value | ||||||||||||
End of year | $ | 6.99 | $ | 12.23 | $ | 9.90 | ||||||
Total Return(b) | (42.85) | % | 23.54 | % | 8.83% | (g) | ||||||
Net Assets End of Year | $ | 500,722 | $ | 888,019 | $ | 714,803 | ||||||
Ratio and Supplemental Data | ||||||||||||
Expenses to average net assets | ||||||||||||
After reimbursement/fee waiver | 0.75 | % | 0.78 | % | 0.81 | %(h) | ||||||
Before reimbursement/fee waiver | 0.75 | % | 0.78 | % | 0.81 | %(h) | ||||||
Net investment income, to average net assets(c) | 0.55 | % | 0.13 | % | 0.02 | %(h) | ||||||
Portfolio turnover rate | 33 | % | 62 | % | 19 | %(g) |
Transamerica Equity | ||||||||||||
Class T | ||||||||||||
October 31, | October 31, | October 31, | ||||||||||
2008 | 2007 | 2006(i) | ||||||||||
Net Asset Value | ||||||||||||
Beginning of year | $ | 33.53 | $ | 27.18 | $ | 27.10 | ||||||
Investment Operations | ||||||||||||
Net investment income(a) | 0.12 | — | — | (d) | ||||||||
Net realized and unrealized gain (loss) on investments | (14.51 | ) | 6.35 | 0.08 | ||||||||
Total from investment operations | (14.39 | ) | 6.35 | 0.08 | ||||||||
Net Asset Value | ||||||||||||
End of year | $ | 19.14 | $ | 33.53 | $ | 27.18 | ||||||
Total Return(b) | (42.92) | % | 23.36 | % | 0.30 | %(g) | ||||||
Net Assets End of Year | $ | 90,881 | $ | 183,495 | $ | 195,420 | ||||||
Ratio and Supplemental Data | ||||||||||||
Expenses to average net assets | ||||||||||||
After reimbursement/fee waiver | 0.89 | % | 0.91 | % | 0.84 | %(h) | ||||||
Before reimbursement/fee waiver | 0.89 | % | 0.91 | % | 0.84 | %(h) | ||||||
Net investment income (loss), to average net assets(c) | 0.42 | % | 0.01 | % | (0.21 | )%(h) | ||||||
Portfolio turnover rate | 33 | % | 62 | % | 19 | %(g) |
The notes to the financial statements are an integral part of this report.
90
Transamerica Flexible Income | ||||||||||||||||||||
Class A | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 9.14 | $ | 9.38 | $ | 9.31 | $ | 9.68 | $ | 10.21 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.44 | 0.48 | 0.43 | 0.37 | 0.38 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (1.89 | ) | (0.25 | ) | 0.05 | (0.32 | ) | 0.14 | ||||||||||||
Total from investment operations | (1.45 | ) | 0.23 | 0.48 | 0.05 | 0.52 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.47 | ) | (0.47 | ) | (0.41 | ) | (0.38 | ) | (0.38 | ) | ||||||||||
Net realized gains on investments | — | — | — | — | (0.63 | ) | ||||||||||||||
Return of capital | — | — | — | (0.04 | ) | (0.04 | ) | |||||||||||||
Total distributions | (0.47 | ) | (0.47 | ) | (0.41 | ) | (0.42 | ) | (1.05 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 7.22 | $ | 9.14 | $ | 9.38 | $ | 9.31 | $ | 9.68 | ||||||||||
Total Return(b) | (16.57 | )% | 2.42 | % | 5.34 | % | 0.47 | % | 5.72 | % | ||||||||||
Net Assets End of Year | $ | 13,360 | $ | 15,409 | $ | 17,005 | $ | 140,203 | $ | 80,201 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 1.39 | % | 1.40 | % | 1.47 | % | 1.25 | % | 1.43 | % | ||||||||||
Before reimbursement/fee waiver | 1.39 | % | 1.40 | % | 1.47 | % | 1.25 | % | 1.43 | % | ||||||||||
Net investment income, to average net assets(c) | 5.12 | % | 5.12 | % | 4.64 | % | 3.85 | % | 3.89 | % | ||||||||||
Portfolio turnover rate | 98 | % | 108 | % | 110 | % | 58 | % | 169 | % |
Transamerica Flexible Income | ||||||||||||||||||||
Class B | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 9.14 | $ | 9.39 | $ | 9.32 | $ | 9.68 | $ | 10.20 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.38 | 0.42 | 0.38 | 0.29 | 0.32 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (1.88 | ) | (0.26 | ) | 0.06 | (0.32 | ) | 0.15 | ||||||||||||
Total from investment operations | (1.50 | ) | 0.16 | 0.44 | (0.03 | ) | 0.47 | |||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.41 | ) | (0.41 | ) | (0.37 | ) | (0.29 | ) | (0.32 | ) | ||||||||||
Net realized gains on investments | — | — | — | — | (0.63 | ) | ||||||||||||||
Return of capital | — | — | — | (0.04 | ) | (0.04 | ) | |||||||||||||
Total distributions | (0.41 | ) | (0.41 | ) | (0.37 | ) | (0.33 | ) | (0.99 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 7.23 | $ | 9.14 | $ | 9.39 | $ | 9.32 | $ | 9.68 | ||||||||||
Total Return(b) | (17.03 | )% | 1.66 | % | 4.81 | % | (0.36 | )% | 5.13 | % | ||||||||||
Net Assets End of Year | $ | 8,628 | $ | 17,007 | $ | 23,501 | $ | 32,560 | $ | 45,338 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.05 | % | 2.04 | % | 2.08 | % | 2.08 | % | 2.03 | % | ||||||||||
Before reimbursement/fee waiver | 2.05 | % | 2.04 | % | 2.08 | % | 2.08 | % | 2.03 | % | ||||||||||
Net investment income, to average net assets(c) | 4.42 | % | 4.48 | % | 4.08 | % | 3.02 | % | 3.25 | % | ||||||||||
Portfolio turnover rate | 98 | % | 108 | % | 110 | % | 58 | % | 169 | % |
The notes to the financial statements are an integral part of this report.
91
Transamerica Flexible Income | ||||||||||||||||||||
Class C | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 9.12 | $ | 9.36 | $ | 9.30 | $ | 9.67 | $ | 10.20 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.39 | 0.42 | 0.39 | 0.29 | 0.33 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (1.88 | ) | (0.25 | ) | 0.04 | (0.33 | ) | 0.13 | ||||||||||||
Total from investment operations | (1.49 | ) | 0.17 | 0.43 | (0.04 | ) | 0.46 | |||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.42 | ) | (0.41 | ) | (0.37 | ) | (0.29 | ) | (0.32 | ) | ||||||||||
Net realized gains on investments | — | — | — | — | (0.63 | ) | ||||||||||||||
Return of capital | — | — | — | (0.04 | ) | (0.04 | ) | |||||||||||||
Total distributions | (0.42 | ) | (0.41 | ) | (0.37 | ) | (0.33 | ) | (0.99 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 7.21 | $ | 9.12 | $ | 9.36 | $ | 9.30 | $ | 9.67 | ||||||||||
Total Return(b) | (16.98 | )% | 1.81 | % | 4.74 | % | (0.40 | )% | 5.02 | % | ||||||||||
Net Assets End of Year | $ | 5,981 | $ | 8,982 | $ | 12,519 | $ | 13,439 | $ | 19,675 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 1.97 | % | 2.00 | % | 2.07 | % | 2.11 | % | 2.10 | % | ||||||||||
Before reimbursement/fee waiver | 1.97 | % | 2.00 | % | 2.07 | % | 2.11 | % | 2.10 | % | ||||||||||
Net investment income, to average net assets(c) | 4.52 | % | 4.51 | % | 4.15 | % | 2.99 | % | 3.37 | % | ||||||||||
Portfolio turnover rate | 98 | % | 108 | % | 110 | % | 58 | % | 169 | % |
Transamerica Flexible Income | ||||||||||||||||
Class I | ||||||||||||||||
October 31, | October 31, | October 31, | October 31, | |||||||||||||
2008 | 2007 | 2006 | 2005(j) | |||||||||||||
Net Asset Value | ||||||||||||||||
Beginning of year | $ | 9.17 | $ | 9.42 | $ | 9.35 | $ | 9.68 | ||||||||
Investment Operations | ||||||||||||||||
Net investment income(a) | 0.50 | 0.53 | 0.50 | 0.40 | ||||||||||||
Net realized and unrealized gain (loss) on investments | (1.90 | ) | (0.26 | ) | 0.05 | (0.32 | ) | |||||||||
Total from investment operations | (1.40 | ) | 0.27 | 0.55 | 0.08 | |||||||||||
Distributions | ||||||||||||||||
Net investment income | (0.52 | ) | (0.52 | ) | (0.48 | ) | (0.37 | ) | ||||||||
Net realized gains on investments | — | — | — | (0.04 | ) | |||||||||||
Total distributions | (0.52 | ) | (0.52 | ) | (0.48 | ) | (0.41 | ) | ||||||||
Net Asset Value | ||||||||||||||||
End of year | $ | 7.25 | $ | 9.17 | $ | 9.42 | $ | 9.35 | ||||||||
Total Return(b) | (16.02 | )% | 2.93 | % | 6.04 | % | 0.85 | %(g) | ||||||||
Net Assets End of Year | $ | 128,108 | $ | 370,611 | $ | 221,116 | $ | 110,709 | ||||||||
Ratio and Supplemental Data | ||||||||||||||||
Expenses to average net assets | ||||||||||||||||
After reimbursement/fee waiver | 0.77 | % | 0.80 | % | 0.86 | % | 0.85 | %(h) | ||||||||
Before reimbursement/fee waiver | 0.77 | % | 0.80 | % | 0.86 | % | 0.85 | %(h) | ||||||||
Net investment income, to average net assets(c) | 5.67 | % | 5.71 | % | 5.35 | % | 4.25 | %(h) | ||||||||
Portfolio turnover rate | 98 | % | 108 | % | 110 | % | 58 | %(g) |
The notes to the financial statements are an integral part of this report.
92
Transamerica Growth Opportunities | ||||||||||||||||||||
Class A | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 11.40 | $ | 8.36 | $ | 7.85 | $ | 6.61 | $ | 5.95 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment loss(a) | (0.06 | ) | (0.09 | ) | (0.07 | ) | (0.02 | ) | (0.03 | ) | ||||||||||
Net realized and unrealized gain (loss) on investments | (4.77 | ) | 3.13 | 0.58 | 1.26 | 0.69 | ||||||||||||||
Total from investment operations | (4.83 | ) | 3.04 | 0.51 | 1.24 | 0.66 | ||||||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 6.57 | $ | 11.40 | $ | 8.36 | $ | 7.85 | $ | 6.61 | ||||||||||
Total Return(b) | (42.37 | )% | 36.20 | % | 6.62 | % | 18.76 | % | 11.09 | % | ||||||||||
Net Assets End of Year | $ | 41,005 | $ | 64,825 | $ | 56,588 | $ | 256,559 | $ | 230,633 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 1.75 | % | 1.75 | % | 1.72 | % | 1.41 | % | 1.43 | % | ||||||||||
Before reimbursement/fee waiver | 1.81 | % | 1.77 | % | 1.72 | % | 1.41 | % | 1.43 | % | ||||||||||
Net investment loss, to average net assets(c) | (0.69 | )% | (1.00 | )% | (0.89 | )% | (0.30 | )% | (0.47 | )% | ||||||||||
Portfolio turnover rate | 45 | % | 85 | % | 59 | % | 34 | % | 43 | % |
Transamerica Growth Opportunities | ||||||||||||||||||||
Class B | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 10.72 | $ | 7.92 | $ | 7.48 | $ | 6.37 | $ | 5.79 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment loss(a) | (0.12 | ) | (0.14 | ) | (0.13 | ) | (0.09 | ) | (0.09 | ) | ||||||||||
Net realized and unrealized gain (loss) on investments | (4.47 | ) | 2.94 | 0.57 | 1.20 | 0.67 | ||||||||||||||
Total from investment operations | (4.59 | ) | 2.80 | 0.44 | 1.11 | 0.58 | ||||||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 6.13 | $ | 10.72 | $ | 7.92 | $ | 7.48 | $ | 6.37 | ||||||||||
Total Return(b) | (42.82 | )% | 35.35 | % | 5.88 | % | 17.43 | % | 10.02 | % | ||||||||||
Net Assets End of Year | $ | 20,823 | $ | 65,123 | $ | 66,098 | $ | 74,589 | $ | 77,869 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.40 | % | 2.40 | % | 2.40 | % | 2.40 | % | 2.40 | % | ||||||||||
Before reimbursement/fee waiver | 2.46 | % | 2.45 | % | 2.46 | % | 2.61 | % | 2.64 | % | ||||||||||
Net investment loss, to average net assets(c) | (1.39 | )% | (1.66 | )% | (1.57 | )% | (1.29 | )% | (1.44 | )% | ||||||||||
Portfolio turnover rate | 45 | % | 85 | % | 59 | % | 34 | % | 43 | % |
The notes to the financial statements are an integral part of this report.
93
Transamerica Growth Opportunities | ||||||||||||||||||||
Class C | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 10.74 | $ | 7.94 | $ | 7.49 | $ | 6.38 | $ | 5.79 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment loss(a) | (0.11 | ) | (0.14 | ) | (0.12 | ) | (0.09 | ) | (0.10 | ) | ||||||||||
Net realized and unrealized gain (loss) on investments | (4.47 | ) | 2.94 | 0.57 | 1.20 | 0.69 | ||||||||||||||
Total from investment operations | (4.58 | ) | 2.80 | 0.45 | 1.11 | 0.59 | ||||||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 6.16 | $ | 10.74 | $ | 7.94 | $ | 7.49 | $ | 6.38 | ||||||||||
Total Return(b) | (42.64 | )% | 35.26 | % | 6.01 | % | 17.40 | % | 10.19 | % | ||||||||||
Net Assets End of Year | $ | 10,619 | $ | 22,656 | $ | 21,688 | $ | 25,432 | $ | 28,103 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.34 | % | 2.36 | % | 2.38 | % | 2.40 | % | 2.40 | % | ||||||||||
Before reimbursement/fee waiver | 2.34 | % | 2.36 | % | 2.38 | % | 2.54 | % | 2.65 | % | ||||||||||
Net investment loss, to average net assets(c) | (1.29 | )% | (1.61 | )% | (1.54 | )% | (1.29 | )% | (1.58 | )% | ||||||||||
Portfolio turnover rate | 45 | % | 85 | % | 59 | % | 34 | % | 43 | % |
Transamerica Growth Opportunities | ||||||||||||
Class I | ||||||||||||
October 31, | October 31, | October 31, | ||||||||||
2008 | 2007 | 2006(f) | ||||||||||
Net Asset Value | ||||||||||||
Beginning of year | $ | 11.59 | $ | 8.43 | $ | 7.99 | ||||||
Investment Operations | ||||||||||||
Net investment income (loss)(a) | 0.01 | (0.01 | ) | — | (d) | |||||||
Net realized and unrealized gain (loss) on investments | (4.86 | ) | 3.17 | 0.44 | ||||||||
Total from investment operations | (4.85 | ) | 3.16 | 0.44 | ||||||||
Net Asset Value | ||||||||||||
End of year | $ | 6.74 | $ | 11.59 | $ | 8.43 | ||||||
Total Return(b) | (41.85 | )% | 37.49 | % | 5.51 | %(g) | ||||||
Net Assets End of Year | $ | 86,425 | $ | 206,863 | $ | 214,775 | ||||||
Ratio and Supplemental Data | ||||||||||||
Expenses to average net assets | ||||||||||||
After reimbursement/fee waiver | 0.86 | % | 0.88 | % | 0.88% | (h) | ||||||
Before reimbursement/fee waiver | 0.86 | % | 0.88 | % | 0.88% | (h) | ||||||
Net investment income (loss), to average net assets(c) | 0.15 | % | (0.15 | )% | (0.06% | (h) | ||||||
Portfolio turnover rate | 45 | % | 85 | % | 59% | (g) |
The notes to the financial statements are an integral part of this report.
94
Transamerica High Yield Bond | ||||||||||||||||||||
Class A | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 9.12 | $ | 9.19 | $ | 8.97 | $ | 9.37 | $ | 9.08 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.64 | 0.60 | 0.61 | 0.56 | 0.52 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (2.83 | ) | (0.07 | ) | 0.19 | (0.37 | ) | 0.29 | ||||||||||||
Total from investment operations | (2.19 | ) | 0.53 | 0.80 | 0.19 | 0.81 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.62 | ) | (0.60 | ) | (0.58 | ) | (0.59 | ) | (0.52 | ) | ||||||||||
Total distributions | (0.62 | ) | (0.60 | ) | (0.58 | ) | (0.59 | ) | (0.52 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 6.31 | $ | 9.12 | $ | 9.19 | $ | 8.97 | $ | 9.37 | ||||||||||
Total Return(b) | (25.46 | )% | 5.90 | % | 9.27 | % | 2.06 | % | 9.23 | % | ||||||||||
Net Assets End of Year | $ | 24,506 | $ | 35,147 | $ | 43,514 | $ | 336,340 | $ | 309,223 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 1.16 | % | 1.15 | % | 1.16 | % | 1.05 | % | 1.08 | % | ||||||||||
Before reimbursement/fee waiver | 1.16 | % | 1.15 | % | 1.16 | % | 1.05 | % | 1.08 | % | ||||||||||
Net investment income, to average net assets(c) | 7.65 | % | 6.45 | % | 6.77 | % | 6.04 | % | 5.67 | % | ||||||||||
Portfolio turnover rate | 38 | % | 80 | % | 73 | % | 71 | % | 49 | % |
Transamerica High Yield Bond | ||||||||||||||||||||
Class B | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 9.11 | $ | 9.18 | $ | 8.97 | $ | 9.37 | $ | 9.08 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.58 | 0.53 | 0.55 | 0.48 | 0.46 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (2.83 | ) | (0.06 | ) | 0.19 | (0.37 | ) | 0.29 | ||||||||||||
Total from investment operations | (2.25 | ) | 0.47 | 0.74 | 0.11 | 0.75 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.56 | ) | (0.54 | ) | (0.53 | ) | (0.51 | ) | (0.46 | ) | ||||||||||
Total distributions | (0.56 | ) | (0.54 | ) | (0.53 | ) | (0.51 | ) | (0.46 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 6.30 | $ | 9.11 | $ | 9.18 | $ | 8.97 | $ | 9.37 | ||||||||||
Total Return(b) | (26.04 | )% | 5.19 | % | 8.53 | % | 1.21 | % | 8.52 | % | ||||||||||
Net Assets End of Year | $ | 9,091 | $ | 21,370 | $ | 27,753 | $ | 37,006 | $ | 49,422 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 1.85 | % | 1.83 | % | 1.83 | % | 1.85 | % | 1.72 | % | ||||||||||
Before reimbursement/fee waiver | 1.85 | % | 1.83 | % | 1.83 | % | 1.85 | % | 1.72 | % | ||||||||||
Net investment income, to average net assets(c) | 6.83 | % | 5.77 | % | 6.12 | % | 5.18 | % | 5.05 | % | ||||||||||
Portfolio turnover rate | 38 | % | 80 | % | 73 | % | 71 | % | 49 | % |
The notes to the financial statements are an integral part of this report.
95
Transamerica High Yield Bond | ||||||||||||||||||||
Class C | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 9.10 | $ | 9.17 | $ | 8.96 | $ | 9.36 | $ | 9.08 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.58 | 0.53 | 0.55 | 0.47 | 0.46 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (2.82 | ) | (0.06 | ) | 0.19 | (0.36 | ) | 0.28 | ||||||||||||
Total from investment operations | (2.24 | ) | 0.47 | 0.74 | 0.11 | 0.74 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.56 | ) | (0.54 | ) | (0.53 | ) | (0.51 | ) | (0.46 | ) | ||||||||||
Total distributions | (0.56 | ) | (0.54 | ) | (0.53 | ) | (0.51 | ) | (0.46 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 6.30 | $ | 9.10 | $ | 9.17 | $ | 8.96 | $ | 9.36 | ||||||||||
Total Return(b) | (25.89 | )% | 5.21 | % | 8.54 | % | 1.21 | % | 8.41 | % | ||||||||||
Net Assets End of Year | $ | 5,429 | $ | 10,160 | $ | 11,317 | $ | 15,880 | $ | 25,379 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 1.80 | % | 1.83 | % | 1.83 | % | 1.88 | % | 1.78 | % | ||||||||||
Before reimbursement/fee waiver | 1.80 | % | 1.83 | % | 1.83 | % | 1.88 | % | 1.78 | % | ||||||||||
Net investment income, to average net assets(c) | 6.93 | % | 5.77 | % | 6.12 | % | 5.11 | % | 4.95 | % | ||||||||||
Portfolio turnover rate | 38 | % | 80 | % | 73 | % | 71 | % | 49 | % |
Transamerica High Yield Bond | ||||||||||||||||
Class I | ||||||||||||||||
October 31, | October 31, | October 31, | October 31, | |||||||||||||
2008 | 2007 | 2006 | 2005(j) | |||||||||||||
Net Asset Value | ||||||||||||||||
Beginning of year | $ | 9.17 | $ | 9.24 | $ | 9.02 | $ | 9.39 | ||||||||
Investment Operations | ||||||||||||||||
Net investment income(a) | 0.69 | 0.65 | 0.67 | 0.59 | ||||||||||||
Net realized and unrealized gain (loss) on investments | (2.85 | ) | (0.07 | ) | 0.18 | (0.37 | ) | |||||||||
Total from investment operations | (2.16 | ) | 0.58 | 0.85 | 0.22 | |||||||||||
Distributions | ||||||||||||||||
Net investment income | (0.66 | ) | (0.65 | ) | (0.63 | ) | (0.59 | ) | ||||||||
Total distributions | (0.66 | ) | (0.65 | ) | (0.63 | ) | (0.59 | ) | ||||||||
Net Asset Value | ||||||||||||||||
End of year | $ | 6.35 | $ | 9.17 | $ | 9.24 | $ | 9.02 | ||||||||
Total Return(b) | (25.05 | )% | 6.39 | % | 9.81 | % | 2.33 | %(g) | ||||||||
Net Assets End of Year | $ | 418,923 | $ | 331,300 | $ | 315,252 | $ | 40,860 | ||||||||
Ratio and Supplemental Data | ||||||||||||||||
Expenses to average net assets | ||||||||||||||||
After reimbursement/fee waiver | 0.65 | % | 0.65 | % | 0.66 | % | 0.66 | %(h) | ||||||||
Before reimbursement/fee waiver | 0.65 | % | 0.65 | % | 0.66 | % | 0.66 | %(h) | ||||||||
Net investment income, to average net assets(c) | 8.34 | % | 6.96 | % | 7.29 | % | 6.60 | %(h) | ||||||||
Portfolio turnover rate | 38 | % | 80 | % | 73 | % | 71 | %(g) |
The notes to the financial statements are an integral part of this report.
96
Transamerica Legg Mason Partners All Cap | ||||||||||||||||||||
Class A | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 17.08 | $ | 18.18 | $ | 16.10 | $ | 14.80 | $ | 13.95 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income (loss)(a) | 0.12 | 0.07 | 0.09 | 0.06 | (0.03 | ) | ||||||||||||||
Net realized and unrealized gain (loss) on investments | (5.73 | ) | 1.49 | 2.55 | 1.24 | 0.88 | ||||||||||||||
Total from investment operations | (5.61 | ) | 1.56 | 2.64 | 1.30 | 0.85 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | — | (0.06 | ) | (0.01 | ) | — | (d) | — | ||||||||||||
Net realized gains on investments | (1.49 | ) | (2.60 | ) | (0.55 | ) | — | — | ||||||||||||
Total distributions | (1.49 | ) | (2.66 | ) | (0.56 | ) | — | (d) | — | |||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 9.98 | $ | 17.08 | $ | 18.18 | $ | 16.10 | $ | 14.80 | ||||||||||
�� | ||||||||||||||||||||
Total Return(b) | (35.81 | )% | 9.27 | % | 16.74 | % | 8.79 | % | 6.09 | % | ||||||||||
Net Assets End of Year | $ | 28,237 | $ | 49,938 | $ | 55,622 | $ | 173,929 | $ | 438,047 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 1.55 | % | 1.55 | % | 1.55 | % | 1.32 | % | 1.33 | % | ||||||||||
Before reimbursement/fee waiver | 1.59 | % | 1.56 | % | 1.57 | % | 1.32 | % | 1.33 | % | ||||||||||
Net investment income (loss), to average net assets(c) | 0.85 | % | 0.42 | % | 0.52 | % | 0.36 | % | (0.17 | )% | ||||||||||
Portfolio turnover rate | 27 | % | 17 | % | 25 | % | 27 | % | 25 | % |
Transamerica Legg Mason Partners All Cap | ||||||||||||||||||||
Class B | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 16.01 | $ | 17.24 | $ | 15.39 | $ | 14.27 | $ | 13.53 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income (loss)(a) | 0.02 | (0.03 | ) | (0.03 | ) | (0.09 | ) | (0.11 | ) | |||||||||||
Net realized and unrealized gain (loss) on investments | (5.30 | ) | 1.40 | 2.43 | 1.21 | 0.85 | ||||||||||||||
Total from investment operations | (5.28 | ) | 1.37 | 2.40 | 1.12 | 0.74 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | — | — | — | (d) | — | — | ||||||||||||||
Net realized gains on investments | (1.49 | ) | (2.60 | ) | (0.55 | ) | — | — | ||||||||||||
Total distributions | (1.49 | ) | (2.60 | ) | (0.55 | ) | — | — | ||||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 9.24 | $ | 16.01 | $ | 17.24 | $ | 15.39 | $ | 14.27 | ||||||||||
Total Return(b) | (36.18 | )% | 8.57 | % | 15.97 | % | 7.84 | % | 5.48 | % | ||||||||||
Net Assets End of Year | $ | 33,670 | $ | 88,268 | $ | 109,567 | $ | 123,494 | $ | 150,829 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.20 | % | 2.19 | % | 2.20 | % | 2.19 | % | 1.97 | % | ||||||||||
Before reimbursement/fee waiver | 2.24 | % | 2.19 | % | 2.21 | % | 2.19 | % | 1.97 | % | ||||||||||
Net investment income (loss), to average net assets(c) | 0.20 | % | (0.22 | )% | (0.17 | )% | (0.58 | )% | (0.80 | )% | ||||||||||
Portfolio turnover rate | 27 | % | 17 | % | 25 | % | 27 | % | 25 | % |
The notes to the financial statements are an integral part of this report.
97
Transamerica Legg Mason Partners All Cap | ||||||||||||||||||||
Class C | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 16.04 | $ | 17.25 | $ | 15.39 | $ | 14.26 | $ | 13.53 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income (loss)(a) | 0.03 | (0.02 | ) | (0.02 | ) | (0.08 | ) | (0.12 | ) | |||||||||||
Net realized and unrealized gain (loss) on investments | (5.32 | ) | 1.41 | 2.43 | 1.21 | 0.85 | ||||||||||||||
Total from investment operations | (5.29 | ) | 1.39 | 2.41 | 1.13 | 0.73 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | — | — | — | (d) | — | — | ||||||||||||||
Net realized gains on investments | (1.49 | ) | (2.60 | ) | (0.55 | ) | — | — | ||||||||||||
Total distributions | (1.49 | ) | (2.60 | ) | (0.55 | ) | — | — | ||||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 9.26 | $ | 16.04 | $ | 17.25 | $ | 15.39 | $ | 14.26 | ||||||||||
Total Return(b) | (36.17 | )% | 8.70 | % | 16.04 | % | 7.89 | % | 5.43 | % | ||||||||||
Net Assets End of Year | $ | 15,316 | $ | 35,568 | $ | 41,340 | $ | 49,909 | $ | 65,391 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.15 | % | 2.13 | % | 2.15 | % | 2.15 | % | 1.99 | % | ||||||||||
Before reimbursement/fee waiver | 2.15 | % | 2.13 | % | 2.15 | % | 2.15 | % | 1.99 | % | ||||||||||
Net investment income (loss), to average net assets(c) | 0.26 | % | (0.15 | )% | (0.12 | )% | (0.53 | )% | (0.83 | )% | ||||||||||
Portfolio turnover rate | 27 | % | 17 | % | 25 | % | 27 | % | 25 | % |
Transamerica Money Market | ||||||||||||||||||||
Class A | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.02 | 0.05 | 0.04 | 0.02 | — | (d) | ||||||||||||||
Net realized and unrealized gain on investments | — | (d) | — | — | — | — | ||||||||||||||
Total from investment operations | 0.02 | 0.05 | 0.04 | 0.02 | — | (d) | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.02 | ) | (0.05 | ) | (0.04 | ) | (0.02 | ) | — | (d) | ||||||||||
Net realized gains on investments | — | — | (d) | — | — | — | ||||||||||||||
Total distributions | (0.02 | ) | (0.05 | ) | (0.04 | ) | (0.02 | ) | — | (d) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | ||||||||||
Total Return(b) | 2.52 | % | 4.61 | % | 4.09 | % | 2.10 | % | 0.42 | % | ||||||||||
Net Assets End of Year | $ | 142,456 | $ | 95,766 | $ | 78,716 | $ | 150,804 | $ | 185,311 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 0.83 | % | 0.83 | % | 0.83 | % | 0.83 | % | 0.83 | % | ||||||||||
Before reimbursement/fee waiver | 1.08 | % | 1.20 | % | 1.23 | % | 1.05 | % | 1.19 | % | ||||||||||
Net investment income, to average net assets(c) | 2.40 | % | 4.54 | % | 3.98 | % | 2.08 | % | 0.45 | % |
The notes to the financial statements are an integral part of this report.
98
Transamerica Money Market | ||||||||||||||||||||
Class B | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.02 | 0.04 | 0.03 | 0.02 | — | (d) | ||||||||||||||
Net realized and unrealized gain on investments | — | (d) | — | — | — | — | ||||||||||||||
Total from investment operations | 0.02 | 0.04 | 0.03 | 0.02 | — | (d) | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.02 | ) | (0.04 | ) | (0.03 | ) | (0.02 | ) | — | (d) | ||||||||||
Net realized gains on investments | — | — | (d) | — | — | — | ||||||||||||||
Total distributions | (0.02 | ) | (0.04 | ) | (0.03 | ) | (0.02 | ) | — | (d) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | ||||||||||
Total Return(b) | 1.83 | % | 3.92 | % | 3.41 | % | 1.60 | % | 0.14 | % | ||||||||||
Net Assets End of Year | $ | 40,110 | $ | 23,324 | $ | 25,727 | $ | 31,647 | $ | 40,203 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 1.48 | % | 1.48 | % | 1.48 | % | 1.32 | % | 1.10 | % | ||||||||||
Before reimbursement/fee waiver | 1.75 | % | 1.83 | % | 1.80 | % | 1.79 | % | 1.81 | % | ||||||||||
Net investment income, to average net assets(c) | 1.75 | % | 3.87 | % | 3.50 | % | 1.57 | % | 0.13 | % |
Transamerica Money Market | ||||||||||||||||||||
Class C | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.02 | 0.04 | 0.03 | 0.02 | — | (d) | ||||||||||||||
Net realized and unrealized gain on investments | — | (d) | — | — | — | — | ||||||||||||||
Total from investment operations | 0.02 | 0.04 | 0.03 | 0.02 | — | (d) | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.02 | ) | (0.04 | ) | (0.03 | ) | (0.02 | ) | — | (d) | ||||||||||
Net realized gains on investments | — | — | (d) | — | — | — | ||||||||||||||
Total distributions | (0.02 | ) | (0.04 | ) | (0.03 | ) | (0.02 | ) | — | (d) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | ||||||||||
Total Return(b) | 1.86 | % | 3.92 | % | 3.16 | % | 1.87 | % | 0.14 | % | ||||||||||
Net Assets End of Year | $ | 59,991 | $ | 19,638 | $ | 17,286 | $ | 15,997 | $ | 22,277 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 1.48 | % | 1.48 | % | 1.48 | % | 1.26 | % | 0.98 | % | ||||||||||
Before reimbursement/fee waiver | 1.67 | % | 1.73 | % | 1.82 | % | 1.89 | % | 1.96 | % | ||||||||||
Net investment income, to average net assets(c) | 1.65 | % | 3.88 | % | 3.40 | % | 1.61 | % | 0.43 | % |
The notes to the financial statements are an integral part of this report.
99
Transamerica Money Market | ||||||||||||
Class I | ||||||||||||
October 31, | October 31, | October 31, | ||||||||||
2008 | 2007 | 2006 (f) | ||||||||||
Net Asset Value | ||||||||||||
Beginning of year | $ | 1.00 | $ | 1.00 | $ | 1.00 | ||||||
Investment Operations | ||||||||||||
Net investment income(a) | 0.03 | 0.05 | 0.04 | |||||||||
Net realized and unrealized gain on investments | — | (d) | — | — | ||||||||
Total from investment operations | 0.03 | 0.05 | 0.04 | |||||||||
Distributions | ||||||||||||
Net investment income | (0.03 | ) | (0.05 | ) | (0.04 | ) | ||||||
Net realized gains on investments | — | — | (d) | — | ||||||||
Total distributions | (0.03 | ) | (0.05 | ) | (0.04 | ) | ||||||
Net Asset Value | ||||||||||||
End of year | $ | 1.00 | $ | 1.00 | $ | 1.00 | ||||||
Total Return(b) | 2.84 | % | 4.98 | % | 4.30 | %(g) | ||||||
Net Assets End of Year | $ | 29,327 | $ | 34,673 | $ | 26,466 | ||||||
Ratio and Supplemental Data | ||||||||||||
Expenses to average net assets | ||||||||||||
After reimbursement/fee waiver | 0.48 | % | 0.48 | % | 0.48 | %(h) | ||||||
Before reimbursement/fee waiver | 0.49 | % | 0.52 | % | 0.51 | %(h) | ||||||
Net investment income, to average net assets(c) | 2.89 | % | 4.88 | % | 4.39 | %(h) |
Transamerica Science & Technology | ||||||||||||||||||||
Class A | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | |||||||||||||||||
2008 | 2007 | 2006 | 2005 | October 31, 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 5.67 | $ | 3.91 | $ | 3.82 | $ | 3.80 | $ | 3.61 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income (loss)(a) | (0.04 | ) | (0.05 | ) | (0.03 | ) | 0.03 | (0.04 | ) | |||||||||||
Net realized and unrealized gain (loss) on investments | (2.61 | ) | 1.81 | 0.18 | 0.02 | 0.23 | ||||||||||||||
Total from investment operations | (2.65 | ) | 1.76 | 0.15 | 0.05 | 0.19 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | — | — | — | (0.03 | ) | — | ||||||||||||||
Net realized gains on investments | (0.18 | ) | — | (0.06 | ) | — | — | |||||||||||||
Total distributions | (0.18 | ) | — | (0.06 | ) | (0.03 | ) | — | ||||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 2.84 | $ | 5.67 | $ | 3.91 | $ | 3.82 | $ | 3.80 | ||||||||||
Total Return(b) | (48.18 | )% | 45.01 | % | 3.78 | % | 1.23 | % | 5.26 | % | ||||||||||
Net Assets End of Year | $ | 3,778 | $ | 7,874 | $ | 5,616 | $ | 65,423 | $ | 119,985 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 1.53 | % | 1.53 | % | 1.53 | % | 1.32 | % | 1.36 | % | ||||||||||
Before reimbursement/fee waiver | 1.70 | % | 1.77 | % | 1.67 | % | 1.32 | % | 1.36 | % | ||||||||||
Net investment income (loss), to average net assets(c) | (1.02 | )% | (1.03 | )% | (0.72 | )% | 0.63 | % | (1.12 | )% | ||||||||||
Portfolio turnover rate | 47 | % | 66 | % | 94 | % | 73 | % | 41 | % |
The notes to the financial statements are an integral part of this report.
100
Transamerica Science & Technology | ||||||||||||||||||||
Class B | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 5.40 | $ | 3.74 | $ | 3.68 | $ | 3.68 | $ | 3.51 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment loss(a) | (0.07 | ) | (0.07 | ) | (0.06 | ) | (0.02 | ) | (0.06 | ) | ||||||||||
Net realized and unrealized gain (loss) on investments | (2.47 | ) | 1.73 | 0.18 | 0.02 | 0.23 | ||||||||||||||
Total from investment operations | (2.54 | ) | 1.66 | 0.12 | — | 0.17 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net realized gains on investments | (0.18 | ) | — | (0.06 | ) | — | — | |||||||||||||
Total distributions | (0.18 | ) | — | (0.06 | ) | — | — | |||||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 2.68 | $ | 5.40 | $ | 3.74 | $ | 3.68 | $ | 3.68 | ||||||||||
Total Return(b) | (48.56 | )% | 44.39 | % | 3.10 | % | — | (e)% | 4.84 | % | ||||||||||
Net Assets End of Year | $ | 2,094 | $ | 4,913 | $ | 4,208 | $ | 5,316 | $ | 6,874 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.18 | % | 2.18 | % | 2.18 | % | 2.20 | % | 1.91 | % | ||||||||||
Before reimbursement/fee waiver | 2.53 | % | 2.53 | % | 2.57 | % | 2.68 | % | 1.91 | % | ||||||||||
Net investment loss, to average net assets(c) | (1.67 | )% | (1.67 | )% | (1.58 | )% | (0.58 | )% | (1.68 | )% | ||||||||||
Portfolio turnover rate | 47 | % | 66 | % | 94 | % | 73 | % | 41 | % |
Transamerica Science & Technology | ||||||||||||||||||||
Class C | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 5.39 | $ | 3.73 | $ | 3.67 | $ | 3.67 | $ | 3.51 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment loss(a) | (0.07 | ) | (0.07 | ) | (0.06 | ) | (0.02 | ) | (0.07 | ) | ||||||||||
Net realized and unrealized gain (loss) on investments | (2.46 | ) | 1.73 | 0.18 | 0.02 | 0.23 | ||||||||||||||
Total from investment operations | (2.53 | ) | 1.66 | 0.12 | — | 0.16 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net realized gains on investments | (0.18 | ) | — | (0.06 | ) | — | — | |||||||||||||
Total distributions | (0.18 | ) | — | (0.06 | ) | — | — | |||||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 2.68 | $ | 5.39 | $ | 3.73 | $ | 3.67 | $ | 3.67 | ||||||||||
Total Return(b) | (48.46 | )% | 44.50 | % | 3.11 | % | — | (e)% | 4.56 | % | ||||||||||
Net Assets End of Year | $ | 1,417 | $ | 2,799 | $ | 2,045 | $ | 2,779 | $ | 4,089 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.18 | % | 2.18 | % | 2.18 | % | 2.20 | % | 2.20 | % | ||||||||||
Before reimbursement/fee waiver | 2.31 | % | 2.36 | % | 2.35 | % | 2.65 | % | 2.60 | % | ||||||||||
Net investment loss, to average net assets(c) | (1.67 | )% | (1.63 | )% | (1.57 | )% | (0.51 | )% | (1.94 | )% | ||||||||||
Portfolio turnover rate | 47 | % | 66 | % | 94 | % | 73 | % | 41 | % |
The notes to the financial statements are an integral part of this report.
101
Transamerica Science & Technology | ||||||||||||
Class I | ||||||||||||
October 31, | October 31, | October 31, | ||||||||||
2008 | 2007 | 2006(f) | ||||||||||
Net Asset Value | ||||||||||||
Beginning of year | $ | 5.74 | $ | 3.93 | $ | 3.98 | ||||||
Investment Operations | ||||||||||||
Net investment loss(a) | (0.02 | ) | (0.02 | ) | (0.01 | ) | ||||||
Net realized and unrealized gain (loss) on investments | (2.65 | ) | 1.83 | 0.02 | ||||||||
Total from investment operations | (2.67 | ) | 1.81 | 0.01 | ||||||||
Distributions | ||||||||||||
Net realized gains on investments | (0.18 | ) | — | (0.06 | ) | |||||||
Total distributions | (0.18 | ) | — | (0.06 | ) | |||||||
Net Asset Value | ||||||||||||
End of year | $ | 2.89 | $ | 5.74 | $ | 3.93 | ||||||
Total Return(b) | (47.93 | )% | 46.06 | % | 0.12 | %(g) | ||||||
Net Assets End of Year | $ | 46,222 | $ | 84,206 | $ | 57,642 | ||||||
Ratio and Supplemental Data | ||||||||||||
Expenses to average net assets | ||||||||||||
After reimbursement/fee waiver | 0.91 | % | 0.92 | % | 0.92 | %(h) | ||||||
Before reimbursement/fee waiver | 0.91 | % | 0.92 | % | 0.92 | %(h) | ||||||
Net investment loss, to average net assets(c) | (0.41 | )% | (0.41 | )% | (0.35 | )%(h) | ||||||
Portfolio turnover rate | 47 | % | 66 | % | 94 | %(g) |
Transamerica Short-Term | ||||||||
Bond | ||||||||
Class A | Class C | |||||||
October 31, | October 31, | |||||||
2008(k) | 2008(k) | |||||||
Net Asset Value | ||||||||
Beginning of year | $ | 10.00 | $ | 10.00 | ||||
Investment Operations | ||||||||
Net investment income(a) | 0.38 | 0.32 | ||||||
Net realized and unrealized loss on investments | (0.54 | ) | (0.55 | ) | ||||
Total from investment operations | (0.16 | ) | (0.23 | ) | ||||
Distributions | ||||||||
Net investment income | (0.40 | ) | (0.35 | ) | ||||
Total distributions | (0.40 | ) | (0.35 | ) | ||||
Net Asset Value | ||||||||
End of year | $ | 9.44 | $ | 9.42 | ||||
Total Return(b) | (1.70 | )%(g) | (2.43 | )%(g) | ||||
Net Assets End of Year | $ | 5,663 | $ | 7,263 | ||||
Ratio and Supplemental Data | ||||||||
Expenses to average net assets | ||||||||
After reimbursement/fee waiver | 1.11 | %(h) | 1.76 | %(h) | ||||
Before reimbursement/fee waiver | 1.11 | %(h) | 1.76 | %(h) | ||||
Net investment income, to average net assets(c) | 3.92 | %(h) | 3.28 | %(h) | ||||
Portfolio turnover rate | 67 | %(g) | 67 | %(g) |
The notes to the financial statements are an integral part of this report.
102
Transamerica Short-Term Bond | ||||||||||||||||
Class I | ||||||||||||||||
October 31, | October 31, | October 31, | October 31, | |||||||||||||
2008 | 2007 | 2006 | 2005(j) | |||||||||||||
Net Asset Value | ||||||||||||||||
Beginning of year | $ | 9.82 | $ | 9.84 | $ | 9.79 | $ | 10.00 | ||||||||
Investment Operations | ||||||||||||||||
Net investment income(a) | 0.43 | 0.47 | 0.40 | 0.28 | ||||||||||||
Net realized and unrealized gain (loss) on investments | (0.54 | ) | (0.04 | ) | 0.05 | (0.22 | ) | |||||||||
Total from investment operations | (0.11 | ) | 0.43 | 0.45 | 0.06 | |||||||||||
Distributions | ||||||||||||||||
Net investment income | (0.43 | ) | (0.45 | ) | (0.40 | ) | (0.27 | ) | ||||||||
Total distributions | (0.43 | ) | (0.45 | ) | (0.40 | ) | (0.27 | ) | ||||||||
Net Asset Value | ||||||||||||||||
End of year | $ | 9.28 | $ | 9.82 | $ | 9.84 | $ | 9.79 | ||||||||
Total Return(b) | (1.22 | )% | 4.45 | % | 4.72 | % | 0.49 | %(g) | ||||||||
Net Assets End of Year | $ | 492,333 | $ | 563,889 | $ | 379,442 | $ | 174,302 | ||||||||
Ratio and Supplemental Data | ||||||||||||||||
Expenses to average net assets | ||||||||||||||||
After reimbursement/fee waiver | 0.68 | % | 0.67 | % | 0.70 | % | 0.71 | %(h) | ||||||||
Before reimbursement/fee waiver | 0.68 | % | 0.67 | % | 0.70 | % | 0.71 | %(h) | ||||||||
Net investment income, to average net assets(c) | 4.38 | % | 4.81 | % | 4.10 | % | 2.92 | %(h) | ||||||||
Portfolio turnover rate | 67 | % | 117 | % | 100 | % | 153 | %(g) |
Transamerica Small/Mid Cap Value | ||||||||||||||||||||
Class A | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 23.78 | $ | 17.78 | $ | 16.69 | $ | 14.32 | $ | 12.94 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.21 | 0.14 | 0.28 | 0.03 | 0.04 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (8.64 | ) | 6.30 | 1.96 | 2.85 | 2.56 | ||||||||||||||
Total from investment operations | (8.43 | ) | 6.44 | 2.24 | 2.88 | 2.60 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.16 | ) | (0.13 | ) | (0.03 | ) | (0.09 | ) | — | |||||||||||
Net realized gains on investments | (2.49 | ) | (0.31 | ) | (1.12 | ) | (0.42 | ) | (1.22 | ) | ||||||||||
Total distributions | (2.65 | ) | (0.44 | ) | (1.15 | ) | (0.51 | ) | (1.22 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 12.70 | $ | 23.78 | $ | 17.78 | $ | 16.69 | $ | 14.32 | ||||||||||
Total Return(b) | (39.47 | )% | 36.99 | % | 13.97 | % | 20.41 | % | 20.61 | % | ||||||||||
Net Assets End of Year | $ | 199,210 | $ | 96,667 | $ | 47,014 | $ | 386,346 | $ | 334,763 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 1.41 | % | 1.41 | % | 1.39 | % | 1.24 | % | 1.32 | % | ||||||||||
Before reimbursement/fee waiver | 1.41 | % | 1.41 | % | 1.39 | % | 1.24 | % | 1.32 | % | ||||||||||
Net investment income, to average net assets(c) | 1.18 | % | 0.71 | % | 1.61 | % | 0.20 | % | 0.31 | % | ||||||||||
Portfolio turnover rate | 48 | % | 22 | % | 21 | % | 42 | % | 81 | % |
The notes to the financial statements are an integral part of this report.
103
Transamerica Small/Mid Cap Value | ||||||||||||||||||||
Class B | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 22.89 | $ | 17.12 | $ | 16.21 | $ | 13.97 | $ | 12.73 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income (loss)(a) | 0.06 | 0.02 | (0.01 | ) | (0.11 | ) | (0.06 | ) | ||||||||||||
Net realized and unrealized gain (loss) on investments | (8.27 | ) | 6.06 | 2.07 | 2.77 | 2.52 | ||||||||||||||
Total from investment operations | (8.21 | ) | 6.08 | 2.06 | 2.66 | 2.46 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | — | — | (0.03 | ) | — | — | ||||||||||||||
Net realized gains on investments | (2.49 | ) | (0.31 | ) | (1.12 | ) | (0.42 | ) | (1.22 | ) | ||||||||||
Total distributions | (2.49 | ) | (0.31 | ) | (1.15 | ) | (0.42 | ) | (1.22 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 12.19 | $ | 22.89 | $ | 17.12 | $ | 16.21 | $ | 13.97 | ||||||||||
Total Return(b) | (39.85 | )% | 36.09 | % | 13.21 | % | 19.30 | % | 19.85 | % | ||||||||||
Net Assets End of Year | $ | 31,716 | $ | 53,285 | $ | 47,007 | $ | 46,410 | $ | 40,477 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.07 | % | 2.07 | % | 2.10 | % | 2.14 | % | 1.97 | % | ||||||||||
Before reimbursement/fee waiver | 2.07 | % | 2.07 | % | 2.10 | % | 2.14 | % | 1.97 | % | ||||||||||
Net investment income (loss), to average net assets(c) | 0.34 | % | 0.12 | % | (0.06 | )% | (0.70 | )% | (0.43 | )% | ||||||||||
Portfolio turnover rate | 48 | % | 22 | % | 21 | % | 42 | % | 81 | % |
Transamerica Small/Mid Cap Value | ||||||||||||||||||||
Class C | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 22.81 | $ | 17.09 | $ | 16.18 | $ | 13.96 | $ | 12.73 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income (loss)(a) | 0.09 | 0.02 | — | (d) | (0.12 | ) | (0.01 | ) | ||||||||||||
Net realized and unrealized gain (loss) on investments | (8.24 | ) | 6.05 | 2.06 | 2.77 | 2.46 | ||||||||||||||
Total from investment operations | (8.15 | ) | 6.07 | 2.06 | 2.65 | 2.45 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.07 | ) | (0.04 | ) | (0.03 | ) | (0.01 | ) | — | |||||||||||
Net realized gains on investments | (2.49 | ) | (0.31 | ) | (1.12 | ) | (0.42 | ) | (1.22 | ) | ||||||||||
Total distributions | (2.56 | ) | (0.35 | ) | (1.15 | ) | (0.43 | ) | (1.22 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 12.10 | $ | 22.81 | $ | 17.09 | $ | 16.18 | $ | 13.96 | ||||||||||
Total Return(b) | (39.84 | )% | 36.16 | % | 13.23 | % | 19.22 | % | 19.78 | % | ||||||||||
Net Assets End of Year | $ | 95,729 | $ | 63,856 | $ | 29,105 | $ | 21,532 | $ | 19,678 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.04 | % | 2.04 | % | 2.08 | % | 2.20 | % | 2.07 | % | ||||||||||
Before reimbursement/fee waiver | 2.04 | % | 2.04 | % | 2.08 | % | 2.20 | % | 2.07 | % | ||||||||||
Net investment income (loss), to average net assets(c) | 0.52 | % | 0.10 | % | (0.03 | )% | (0.76 | )% | (0.02 | )% | ||||||||||
Portfolio turnover rate | 48 | % | 22 | % | 21 | % | 42 | % | 81 | % |
The notes to the financial statements are an integral part of this report.
104
Transamerica Small/Mid Cap Value | ||||||||||||
Class I | ||||||||||||
October 31, 2008 | October 31, 2007 | October 31, 2006(f) | ||||||||||
Net Asset Value | ||||||||||||
Beginning of year | $ | 23.91 | $ | 17.87 | $ | 16.84 | ||||||
Investment Operations | ||||||||||||
Net investment income(a) | 0.30 | 0.26 | 0.18 | |||||||||
Net realized and unrealized gain (loss) on investments | (8.67 | ) | 6.32 | 1.97 | ||||||||
Total from investment operations | (8.37 | ) | 6.58 | 2.15 | ||||||||
Distributions | ||||||||||||
Net investment income | (0.24 | ) | (0.23 | ) | — | |||||||
Net realized gains on investments | (2.49 | ) | (0.31 | ) | (1.12 | ) | ||||||
Total distributions | (2.73 | ) | (0.54 | ) | (1.12 | ) | ||||||
Net Asset Value | ||||||||||||
End of year | $ | 12.81 | $ | 23.91 | $ | 17.87 | ||||||
Total Return(b) | (39.11 | )% | 37.78 | % | 13.30 | %(g) | ||||||
Net Assets End of Year | $ | 214,351 | $ | 487,605 | $ | 478,728 | ||||||
Ratio and Supplemental Data | ||||||||||||
Expenses to average net assets | ||||||||||||
After reimbursement/fee waiver | 0.85 | % | 0.85 | % | 0.86 | %(h) | ||||||
Before reimbursement/fee waiver | 0.85 | % | 0.85 | % | 0.86 | %(h) | ||||||
Net investment income, to average net assets(c) | 1.58 | % | 1.30 | % | 1.05 | %(h) | ||||||
Portfolio turnover rate | 48 | % | 22 | % | 21 | %(g) |
Transamerica Templeton Global | ||||||||||||||||||||
Class A | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 35.83 | $ | 29.28 | $ | 24.68 | $ | 22.57 | $ | 21.41 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income (loss)(a) | 0.33 | 0.19 | 0.15 | 0.21 | (0.07 | ) | ||||||||||||||
Net realized and unrealized gain (loss) on investments | (16.19 | ) | 6.70 | 4.45 | 2.14 | 1.23 | ||||||||||||||
Total from investment operations | (15.86 | ) | 6.89 | 4.60 | 2.35 | 1.16 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.34 | ) | (0.34 | ) | — | (d) | (0.24 | ) | — | |||||||||||
Total distributions | (0.34 | ) | (0.34 | ) | — | (d) | (0.24 | ) | — | |||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 19.63 | $ | 35.83 | $ | 29.28 | $ | 24.68 | $ | 22.57 | ||||||||||
Total Return(b) | (44.68 | )% | 23.74 | % | 18.65 | % | 10.41 | % | 5.41 | % | ||||||||||
Net Assets End of Year | $ | 73,721 | $ | 118,738 | $ | 117,367 | $ | 385,504 | $ | 226,517 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 1.55 | % | 1.55 | % | 1.55 | % | 1.42 | % | 1.85 | % | ||||||||||
Before reimbursement/fee waiver | 1.61 | % | 1.63 | % | 1.62 | % | 1.42 | % | 1.85 | % | ||||||||||
Net investment income (loss), to average net assets(c) | 1.13 | % | 0.59 | % | 0.55 | % | 0.85 | % | (0.31 | )% | ||||||||||
Portfolio turnover rate | 28 | % | 30 | % | 55 | % | 79 | % | 140 | % |
The notes to the financial statements are an integral part of this report.
105
Transamerica Templeton Global | ||||||||||||||||||||
Class B | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 33.52 | $ | 27.40 | $ | 23.24 | $ | 21.23 | $ | 20.25 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income (loss)(a) | 0.08 | (0.02 | ) | (0.01 | ) | 0.02 | (0.20 | ) | ||||||||||||
Net realized and unrealized gain (loss) on investments | (15.14 | ) | 6.28 | 4.17 | 1.99 | 1.18 | ||||||||||||||
Total from investment operations | (15.06 | ) | 6.26 | 4.16 | 2.01 | 0.98 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.05 | ) | (0.14 | ) | — | — | (d) | — | ||||||||||||
Total distributions | (0.05 | ) | (0.14 | ) | — | — | (d) | — | ||||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 18.41 | $ | 33.52 | $ | 27.40 | $ | 23.24 | $ | 21.23 | ||||||||||
Total Return(b) | (44.99 | )% | 22.94 | % | 17.90 | % | 9.48 | % | 4.83 | % | ||||||||||
Net Assets End of Year | $ | 10,746 | $ | 63,876 | $ | 75,711 | $ | 90,877 | $ | 117,409 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.20 | % | 2.20 | % | 2.20 | % | 2.20 | % | 2.49 | % | ||||||||||
Before reimbursement/fee waiver | 2.44 | % | 2.39 | % | 2.42 | % | 2.41 | % | 2.49 | % | ||||||||||
Net investment income (loss), to average net assets(c) | 0.29 | % | (0.07 | )% | (0.05 | )% | 0.07 | % | (0.93 | )% | ||||||||||
Portfolio turnover rate | 28 | % | 30 | % | 55 | % | 79 | % | 140 | % |
Transamerica Templeton Global | ||||||||||||||||||||
Class C | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 33.47 | $ | 27.37 | $ | 23.21 | $ | 21.21 | $ | 20.25 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income (loss)(a) | 0.12 | (0.02 | ) | (0.01 | ) | 0.02 | (0.15 | ) | ||||||||||||
Net realized and unrealized gain (loss) on investments | (15.10 | ) | 6.27 | 4.17 | 1.99 | 1.11 | ||||||||||||||
Total from investment operations | (14.98 | ) | 6.25 | 4.16 | 2.01 | 0.96 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.22 | ) | (0.15 | ) | — | (0.01 | ) | — | ||||||||||||
Total distributions | (0.22 | ) | (0.15 | ) | — | (0.01 | ) | — | ||||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 18.27 | $ | 33.47 | $ | 27.37 | $ | 23.21 | $ | 21.21 | ||||||||||
Total Return(b) | (45.05 | )% | 22.95 | % | 17.87 | % | 9.52 | % | 4.74 | % | ||||||||||
Net Assets End of Year | $ | 14,286 | $ | 31,506 | $ | 32,341 | $ | 36,938 | $ | 48,378 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.20 | % | 2.20 | % | 2.20 | % | 2.20 | % | 2.18 | % | ||||||||||
Before reimbursement/fee waiver | 2.26 | % | 2.31 | % | 2.35 | % | 2.38 | % | 2.18 | % | ||||||||||
Net investment income (loss), to average net assets(c) | 0.43 | % | (0.07 | )% | (0.05 | )% | 0.07 | % | (0.72 | )% | ||||||||||
Portfolio turnover rate | 28 | % | 30 | % | 55 | % | 79 | % | 140 | % |
The notes to the financial statements are an integral part of this report.
106
Transamerica Value Balanced | ||||||||||||||||||||
Class A | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 14.38 | $ | 13.30 | $ | 11.95 | $ | 12.11 | $ | 11.49 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.30 | 0.28 | 0.23 | 0.24 | 0.18 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (4.74 | ) | 1.41 | 1.54 | 0.69 | 0.61 | ||||||||||||||
Total from investment operations | (4.44 | ) | 1.69 | 1.77 | 0.93 | 0.79 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.31 | ) | (0.23 | ) | (0.24 | ) | (0.25 | ) | (0.17 | ) | ||||||||||
Net realized gains on investments | (0.72 | ) | (0.38 | ) | (0.18 | ) | (0.84 | ) | — | |||||||||||
Total distributions | (1.03 | ) | (0.61 | ) | (0.42 | ) | (1.09 | ) | (0.17 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 8.91 | $ | 14.38 | $ | 13.30 | $ | 11.95 | $ | 12.11 | ||||||||||
Total Return(b) | (32.94 | )% | 13.11 | % | 15.09 | % | 7.79 | % | 6.99 | % | ||||||||||
Net Assets End of Year | $ | 18,666 | $ | 32,485 | $ | 32,666 | $ | 32,934 | $ | 37,393 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 1.55 | % | 1.55 | % | 1.55 | % | 1.55 | % | 1.55 | % | ||||||||||
Before reimbursement/fee waiver | 1.56 | % | 1.58 | % | 1.63 | % | 1.59 | % | 1.63 | % | ||||||||||
Net investment income, to average net assets(c) | 2.51 | % | 2.06 | % | 1.84 | % | 2.03 | % | 1.50 | % | ||||||||||
Portfolio turnover rate | 50 | % | 42 | % | 42 | % | 57 | % | 122 | % |
Transamerica Value Balanced | ||||||||||||||||||||
Class B | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 14.32 | $ | 13.25 | $ | 11.91 | $ | 12.07 | $ | 11.46 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.22 | 0.19 | 0.15 | 0.17 | 0.10 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (4.72 | ) | 1.41 | 1.53 | 0.68 | 0.61 | ||||||||||||||
Total from investment operations | (4.50 | ) | 1.60 | 1.68 | 0.85 | 0.71 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.22 | ) | (0.15 | ) | (0.16 | ) | (0.17 | ) | (0.10 | ) | ||||||||||
Net realized gains on investments | (0.72 | ) | (0.38 | ) | (0.18 | ) | (0.84 | ) | — | |||||||||||
Total distributions | (0.94 | ) | (0.53 | ) | (0.34 | ) | (1.01 | ) | (0.10 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 8.88 | $ | 14.32 | $ | 13.25 | $ | 11.91 | $ | 12.07 | ||||||||||
Total Return(b) | (33.37 | )% | 12.40 | % | 14.28 | % | 7.13 | % | 6.23 | % | ||||||||||
Net Assets End of Year | $ | 6,414 | $ | 17,508 | $ | 20,405 | $ | 24,072 | $ | 29,409 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.20 | % | 2.20 | % | 2.20 | % | 2.20 | % | 2.20 | % | ||||||||||
Before reimbursement/fee waiver | 2.30 | % | 2.27 | % | 2.28 | % | 2.27 | % | 2.30 | % | ||||||||||
Net investment income, to average net assets(c) | 1.83 | % | 1.43 | % | 1.20 | % | 1.39 | % | 0.81 | % | ||||||||||
Portfolio turnover rate | 50 | % | 42 | % | 42 | % | 57 | % | 122 | % |
The notes to the financial statements are an integral part of this report.
107
Transamerica Value Balanced | ||||||||||||||||||||
Class C | ||||||||||||||||||||
October 31, | October 31, | October 31, | October 31, | October 31, | ||||||||||||||||
2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
Net Asset Value | ||||||||||||||||||||
Beginning of year | $ | 14.31 | $ | 13.25 | $ | 11.91 | $ | 12.07 | $ | 11.46 | ||||||||||
Investment Operations | ||||||||||||||||||||
Net investment income(a) | 0.22 | 0.19 | 0.15 | 0.17 | 0.11 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (4.72 | ) | 1.41 | 1.53 | 0.69 | 0.60 | ||||||||||||||
Total from investment operations | (4.50 | ) | 1.60 | 1.68 | 0.86 | 0.71 | ||||||||||||||
Distributions | ||||||||||||||||||||
Net investment income | (0.22 | ) | (0.16 | ) | (0.16 | ) | (0.18 | ) | (0.10 | ) | ||||||||||
Net realized gains on investments | (0.72 | ) | (0.38 | ) | (0.18 | ) | (0.84 | ) | — | |||||||||||
Total distributions | (0.94 | ) | (0.54 | ) | (0.34 | ) | (1.02 | ) | (0.10 | ) | ||||||||||
Net Asset Value | ||||||||||||||||||||
End of year | $ | 8.87 | $ | 14.31 | $ | 13.25 | $ | 11.91 | $ | 12.07 | ||||||||||
Total Return(b) | (33.33 | )% | 12.40 | % | 14.33 | % | 7.18 | % | 6.31 | % | ||||||||||
Net Assets End of Year | $ | 5,833 | $ | 11,674 | $ | 11,316 | $ | 11,926 | $ | 14,285 | ||||||||||
Ratio and Supplemental Data | ||||||||||||||||||||
Expenses to average net assets | ||||||||||||||||||||
After reimbursement/fee waiver | 2.13 | % | 2.17 | % | 2.20 | % | 2.16 | % | 2.20 | % | ||||||||||
Before reimbursement/fee waiver | 2.13 | % | 2.17 | % | 2.20 | % | 2.16 | % | 2.39 | % | ||||||||||
Net investment income, to average net assets(c) | 1.92 | % | 1.44 | % | 1.19 | % | 1.43 | % | 0.78 | % | ||||||||||
Portfolio turnover rate | 50 | % | 42 | % | 42 | % | 57 | % | 122 | % |
(a) | Calculation is based on average number of shares outstanding. | |
(b) | Total return has been calculated for the applicable period without deduction of a sales load, if any, on an initial purchase. | |
(c) | Includes Redemption Fees, if any. The impact of Redemption Fees is less than 0.01% for Class A, Class B, Class C, and Class T, respectively. | |
(d) | Rounds to less than $(0.01) or $0.01. | |
(e) | Rounds to less than (0.01%) or 0.01%. | |
(f) | Commenced operations November 15, 2005. | |
(g) | Not annualized. | |
(h) | Annualized. | |
(i) | Commenced operations October 27, 2006. | |
(j) | Commenced operations November 8, 2004. | |
(k) | Commenced operations November 1, 2007. |
The notes to the financial statements are an integral part of this report.
108
NOTES TO FINANCIAL STATEMENTS
At October 31, 2008
(all amounts in thousands)
At October 31, 2008
(all amounts in thousands)
NOTE 1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Transamerica Funds (the “Trust”) is an open-end management investment company registered under the Investment Company Act of 1940, as amended (the “1940 Act”). Transamerica Balanced, Transamerica Convertible Securities, Transamerica Equity, Transamerica Flexible Income, Transamerica Growth Opportunities, Transamerica High Yield Bond, Transamerica Legg Mason Partners All Cap, Transamerica Money Market, Transamerica Science & Technology, Transamerica Short-Term Bond, Transamerica Small/Mid Cap Value, Transamerica Templeton Global and Transamerica Value Balanced (each, a “Fund”; collectively, the “Funds”) are part of Transamerica Funds.
Effective March 1, 2008, Transamerica IDEX Mutual Funds changed its name to Transamerica Funds. Also effective on March 1, 2008, “TA IDEX” was removed from the beginning of each Fund name and replaced with “Transamerica”.
Transamerica Legg Mason Partners All Cap and Transamerica Science & Technology are “non-diversified” under the 1940 Act.
In the normal course of business, the Funds enter into contracts that contain a variety of representations that provide general indemnifications. The Funds’ maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Funds and/or their affiliates that have not yet occurred. However, based on experience, the Funds expect the risk of loss to be remote.
This report should be read in conjunction with the Funds’ current prospectus, which contains more complete information about the Funds.
In preparing the Funds’ financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”), estimates or assumptions (which could differ from actual results) may be used that affect reported amounts and disclosures. The following is a summary of significant accounting policies followed by the Funds.
Multiple class operations, income and expenses: The Funds, except Transamerica Legg Mason Partners All Cap, Transamerica Short-Term Bond, Transamerica Equity and Transamerica Templeton Global, currently have four classes of shares, Class A, Class B, Class C, and Class I. Transamerica Balanced, Transamerica Legg Mason Partners All Cap and Transamerica Templeton Global currently have three classes of shares; Class A, Class B, and Class C. Transamerica Equity currently has five classes of shares, Class A, Class B, Class C, Class I and Class T. Effective November 1, 2007, in addition to Class I, Transamerica Short-Term Bond also offers Class A and Class C shares. Effective March 1, 2008, Class I of Transamerica Templeton Global was liguidated. Class T shares are not available to new investors. Each of the above classes has a public offering price that reflects different sales charges, if any, and expense levels. Class I shares are currently available for investment primarily to certain affiliated asset allocation funds.
Class I shares may also be made available to other investors, including institutional investors such as foreign insurers, domestic insurance companies and their separate accounts, and eligible retirement plans whose record keepers or financial service firm intermediaries have entered into agreements with Transamerica Funds or its agents. Class B shares will convert to Class A shares eight years after purchase. Income, non-class specific expenses and realized and unrealized gains and losses are allocated daily to each class, based upon the value of shares outstanding method as permitted under Rule 18f-3 of the 1940 Act. Each class bears its own specific expenses as well as a portion of general, common expenses.
Security valuations: The Funds value their investments at the close of the New York Stock Exchange (“NYSE”), normally 4 p.m. ET, each day the NYSE is open for business. The Funds’ investments are valued at the last sale price or closing price on the day of valuation taken from the primary exchange where the security is principally traded.
Securities traded in the over-the-counter market and listed securities for which no sale was reported on that date are valued at the last quoted bid price.
Debt securities are valued based on a price quotation or other equivalent indication of value supplied by an exchange, a pricing service or a major market maker; however, those that mature in sixty days or less are valued at amortized cost, which approximates market.
Foreign securities generally are valued based on quotations from the primary market in which they are traded. Because many foreign securities markets and exchanges close prior to the close of the NYSE, closing prices for foreign securities in those markets or on those exchanges do not reflect the events that occur after that close. If a significant market event impacting the value of a portfolio security (e.g., natural disaster, company announcement, market volatility) occurs subsequent to the close of trading in the security, but prior to the calculation of the Funds’ net asset value per share, market quotations for that security may be determined to be unreliable and, accordingly, not “readily available.” As a result, foreign equity securities held by the Funds may be valued at fair market value as determined in good faith by Transamerica Asset Management, Inc.’s (“TAM”) Valuation Committee under the supervision of the Board of Trustees.
Other securities for which quotations are not readily available or whose values have been determined to be unreliable are valued at fair market value as determined in good faith by TAM’s Valuation Committee under the supervision of the Board of Trustees.
109
NOTES TO FINANCIAL STATEMENTS (continued)
At October 31, 2008
(all amounts in thousands)
At October 31, 2008
(all amounts in thousands)
NOTE 1. (continued)
In September 2006, the Financial Accounting Standards Board (“FASB”) issued its new Standard No. 157, “Fair Value Measurements” (“FAS 157”). FAS 157 is designed to unify guidance for the measurement of fair value of all types of assets, including financial instruments, and certain liabilities, throughout a number of accounting standards. FAS 157 also establishes a hierarchy for measuring fair value in generally accepted accounting principles and expands financial statement disclosures about fair value measurements that are relevant to mutual funds. FAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and earlier application is permitted.
As of October 31, 2008, Management does not expect the adoption of FAS 157 to impact the amounts reported in the financial statements, however, additional disclosures will be required about the inputs used to develop the measurements of fair value and the effect of certain of the measurements reported in the statement of operations for a fiscal period.
Repurchase Agreements: The Funds are authorized to enter into repurchase agreements. The Funds, through their custodian, State Street Bank & Trust Company (“State Street”), receive delivery of the underlying securities, the value of which at the time of purchase is required to be an amount equal to at least 102% of the resale price. The Funds will bear the risk of value fluctuations until the security can be sold and may encounter delays and incur costs in liquidating the security. In the event of bankruptcy or insolvency of the seller, delays and costs may be incurred.
Commission recapture: The sub-advisers of certain Funds, to the extent consistent with the best execution and usual commission rate policies and practices, have elected to place security transactions of the Funds with broker/dealers with which Transamerica Funds has established a Commission Recapture Program. A Commission Recapture Program is any arrangement under which a broker/dealer applies a portion of the commissions received by such broker/dealer on the security transactions to the Funds. In no event will commissions paid by the Funds be used to pay expenses that would otherwise be borne by any other funds within Transamerica Funds, or by any other party.
Recaptured comissions during the year ended October 31, 2008 are included in net realized gains on the Statements of Operations and are summarized as follows:
Fund | Commissions | |||
Transamerica Balanced | $ | 5 | ||
Transamerica Equity | 61 | |||
Transamerica Growth Opportunities | 18 | |||
Transamerica Legg Mason Partners All Cap | 10 | |||
Transamerica Science & Technology | 4 | |||
Transamerica Templeton Global | 6 |
Securities Lending: The Funds may lend securities to qualified borrowers, with State Street acting as the Funds’ lending agent. The Funds earn negotiated lenders’ fees. The Funds receive cash and/or securities as collateral against the loaned securities. Cash collateral received is invested in the State Street Navigator Securities Lending Trust-Prime Portfolio. The Funds monitor the market value of securities loaned on a daily basis and requires collateral in an amount at least equal to the value of the securities loaned. The value of loaned securities and related collateral outstanding at October 31, 2008 is shown in the Schedule of Investments and also in the Statement of Assets and Liabilities.
Income from loaned securities on the Statement of Operations is net of fees earned by State Street.
Real Estate Investment Trusts (“REITs”): There are certain additional risks involved in investing in REITs. These include, but are not limited to, economic conditions, changes in zoning laws, real estate values, property taxes and interest rates. Since some of the Funds invest primarily in real estate securities, the net asset value per share may fluctuate more widely than the value of shares of a fund that invests in a broad range of industries.
Dividend income is recorded at managements’ estimate of the income included in distributions from the REIT investments. Distributions received in excess of the estimated amount are recorded as a reduction of the cost of investments. The actual amounts of income, return of capital and capital gains are only determined by each REIT after the fiscal year end and may differ from the estimated amounts.
Security transactions and investment income: Security transactions are recorded on the trade date. Security gains and losses are calculated on the specific identification basis.
Dividend income, if any, is recorded on the ex-dividend date or, in the case of foreign securities, as soon as the Funds are informed of the ex-dividend date. Interest income, including accretion of discounts and amortization of premiums, is recorded on the accrual basis commencing on the settlement date.
Foreign currency denominated investments: The accounting records of the Funds are maintained in U.S. dollars. Securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the closing exchange rate each day. The cost of foreign securities is translated at the exchange rate in effect when the investment was acquired. The Funds combine fluctuations from currency exchange rates and fluctuations in value when computing net realized and unrealized gains or losses from investments.
Net foreign currency gains and losses resulting from changes in exchange rates include: 1) foreign currency fluctuations between trade date and settlement date of investment security transactions; 2) gains and losses on forward foreign currency contracts; and 3) the difference between the receivable amounts of interest and dividends recorded in the accounting records in U.S. dollars and the amounts actually received.
110
NOTES TO FINANCIAL STATEMENTS (continued)
At October 31, 2008
(all amounts in thousands)
At October 31, 2008
(all amounts in thousands)
NOTE 1. (continued)
Foreign currency denominated assets may involve risks not typically associated with domestic transactions. These risks include revaluation of currencies, adverse fluctuations in foreign currency values and possible adverse political, social and economic developments, including those particular to a specific industry, country or region.
Forward foreign currency contracts: The Funds may enter into forward foreign currency contracts to hedge against exchange rate risk arising from investments in securities denominated in foreign currencies. Contracts are valued at the contractual forward rate and are marked to market daily, with the change in value recorded as an unrealized gain or loss. When the contracts are settled a realized gain or loss is incurred. Risks may arise from changes in market value of the underlying currencies and from the possible inability of counterparties to meet the terms of their contracts.
Open forward currency contracts at October 31, 2008 are listed in the Schedules of Investments.
Futures contracts: The Funds may enter into futures contracts to manage exposure to market, interest rate or currency fluctuations. Futures contracts are valued at the settlement price established each day by the board of trade or exchange on which they are traded. The primary risks associated with futures contracts are imperfect correlation between the change in market value of the securities held and the prices of futures contracts; the possibility of an illiquid market and inability of the counterparty to meet the contract terms.
The underlying face amounts of open futures contracts at October 31, 2008 are listed in the Schedules of Investments. The variation margin receivable or payable, as applicable, is included in the Statements of Assets and Liabilities. Variation margin represents the additional payment due or excess deposits made in order to maintain the equity account at the required margin level.
Option contracts: The Funds may enter into options contracts to manage exposure to market fluctuations. Options are valued at the average of the bid and ask (“Mean Quote”) established each day at the close of the board of trade or exchange on which they are traded. The primary risks associated with options are imperfect correlation between the change in value of the securities held and the prices of the options contracts; the possibility of an illiquid market; and inability of the counterparty to meet the contracts terms. When the Funds write covered call or put options, an amount equal to the premium received by the Funds are included in the Funds’ Statements of Assets and Liabilities as an asset and as an equivalent liability. Options are marked-to-market daily to reflect the current value of the option written.
Transactions in written options were as follows:
Transamerica Value Balanced | Premium | Contracts | ||||||
Balance at October 31, 2007 | $ | 418 | 3,253 | |||||
Sales | 51 | 533 | ||||||
Closing Buys | (413 | ) | (3,268 | ) | ||||
Expirations | (51 | ) | (473 | ) | ||||
Exercised | (5 | ) | (45 | ) | ||||
Balance at October 31, 2008 | $ | — | — | |||||
Redemption fees: A short-term trading redemption fee may be assessed on any Fund shares in a fund account that are sold during the first five (5) NYSE trading days following their purchase date. This redemption fee will equal 2% of the amount redeemed and shares held the longest will be treated as being redeemed first and shares held the shortest as being redeemed last. For the year ended October 31, 2008, the Funds received redemption fees which are disclosed in the Funds’ Statements of Changes in Net Assets.
Dividend distributions: Distributions to shareholders are recorded on the ex-dividend date and are determined in accordance with federal income tax regulations.
Temporary Guarantee Program: The Transamerica Money Market has enrolled in the U.S. Treasury Department’s Temporary Guarantee Program for money market funds (the “Program”). Under the Program, the U.S. Treasury guarantees the $1.00 dollar per share value of fund shares outstanding as of September 19, 2008, subject to certain terms and limitations.
Only shareholders who held shares as of September 19, 2008 are eligible to participate in the guarantee. Those shareholders may purchase and redeem shares in their account during the period covered by the Program. However, the number of shares covered by the guarantee cannot exceed the number of shares held by the shareholder at the close of business on September 19, 2008. Thus, to the extent the overall value of a shareholder’s account increases after September 19, 2008, the amount of the increase will not be covered by the guarantee. If a Fund shareholder closes his or her Fund account, any future investment in the Fund will not be guaranteed.
The guarantee will be triggered if the market-based net asset value of the Fund is less than $0.995, unless promptly cured (a “Guarantee Event”). If a Guarantee Event were to occur, the Fund would be required to liquidate. Upon liquidation and subject to the availability of funds under the Program, eligible shareholders would be entitled to receive payments equal to $1.00 per “covered share.” The number of “covered shares” held by a shareholder would be equal to the lesser of (1) the number of shares owned by that shareholder on September 19, 2008 or (2) the number of shares owned by that shareholder on the date upon which the Guarantee Event occurs. The coverage provided for all money market funds participating in the Program (and, in turn, any amount available to the Fund and its eligible shareholders) is subject to an overall limit, currently approximately $50 billion.
The initial period of the Program covered a three month period from September 19, 2008 to December 18, 2008. On November 24, 2008, the Treasury Department announced an extension of the Program from December 19, 2008 through April 30, 2009 (the “Program Extension Period”). On December 5, 2008, the Board of Trustees of the Fund elected to participate in the Program Extension Period. The Program may be later extended by the Treasury Department to terminate no later than September 18, 2009. If the Treasury Department extends the Program, the Board will consider whether to continue to participate. The Fund has paid to the Treasury a fee of 0.01% of its net assets as of September 19, 2008 to participate in the initial three month period of the Program and a fee of 0.015% of its net assets as of September 19, 2008 to participate in the Program Extension Period.
111
NOTES TO FINANCIAL STATEMENTS (continued)
At October 31, 2008
(all amounts in thousands)
At October 31, 2008
(all amounts in thousands)
NOTE 1. (continued)
These expenses are borne by the Fund without regard to any expense limitation agreement in effect for the Fund. Participation in any extension of the Program would require payment of an additional fee, although there can be no assurance that the Fund will elect to participate, or be eligible to participate, in any extension of the Program.
NOTE 2. RELATED PARTY TRANSACTIONS
TAM is the Funds’ investment adviser. Prior to January 1, 2008, TAM was known as Transamerica Fund Advisors, Inc. Transamerica Fund Services, Inc. (“TFS”) is the Funds’ administrator and transfer agent. Transamerica Capital, Inc. (“TCI”) is the Funds’ distributor/principal underwriter. TAM, TFS, and TCI are affiliates of AEGON NV, a Netherlands corporation.
Certain officers and trustees of the Funds are also officers and/or directors of TAM, TFS, and TCI.
The following schedule reflects the percentage of the Funds’ assets owned by affiliated investment companies at October 31, 2008:
Transamerica Convertible Securities | Net Assets | % of Net Assets | ||||||
Transamerica Asset Allocation-Conservative Portfolio | $ | 17,546 | 15.61 | % | ||||
Transamerica Asset Allocation-Moderate Portfolio | 36,033 | 32.05 | ||||||
Transamerica Asset Allocation-Moderate Growth Portfolio | 37,175 | 33.07 | ||||||
Total | $ | 90,754 | 80.73 | % | ||||
Transamerica Equity | Net Assets | % of Net Assets | ||||||
Transamerica Asset Allocation-Conservative Portfolio | $ | 38,924 | 3.90 | % | ||||
Transamerica Asset Allocation-Growth Portfolio | 156,502 | 15.68 | ||||||
Transamerica Asset Allocation-Moderate Portfolio | 102,732 | 10.30 | ||||||
Transamerica Asset Allocation-Moderate Growth Portfolio | 199,564 | 20.00 | ||||||
Total | $ | 497,722 | 49.88 | % | ||||
Transamerica Flexible Income | Net Assets | % of Net Assets | ||||||
Transamerica Asset Allocation-Conservative Portfolio | $ | 10,154 | 6.51 | % | ||||
Transamerica Asset Allocation-Moderate Portfolio | 17,390 | 11.14 | ||||||
Transamerica Asset Allocation-Moderate Growth Portfolio | 36,341 | 23.29 | ||||||
Transamerica Asset Allocation-Conservative VP | 8,700 | 5.57 | ||||||
Transamerica Asset Allocation-Moderate Growth VP | 28,986 | 18.57 | ||||||
Transamerica Asset Allocation-Moderate VP | 26,051 | 16.69 | ||||||
Total | $ | 127,622 | 81.77 | % | ||||
Transamerica Growth Opportunities | Net Assets | % of Net Assets | ||||||
Transamerica Asset Allocation-Conservative Portfolio | $ | 3,416 | 2.15 | % | ||||
Transamerica Asset Allocation-Growth Portfolio | 28,177 | 17.73 | ||||||
Transamerica Asset Allocation-Moderate Portfolio | 12,752 | 8.03 | ||||||
Transamerica Asset Allocation-Moderate Growth Portfolio | 41,444 | 26.09 | ||||||
Total | $ | 85,789 | 54.00 | % | ||||
Transamerica High Yield Bond | Net Assets | % of Net Assets | ||||||
Transamerica Asset Allocation-Conservative Portfolio | $ | 54,271 | 11.85 | % | ||||
Transamerica Asset Allocation-Moderate Portfolio | 82,868 | 18.09 | ||||||
Transamerica Asset Allocation-Moderate Growth Portfolio | 99,466 | 21.72 | ||||||
Transamerica Asset Allocation-Conservative VP | 38,905 | 8.50 | ||||||
Transamerica Asset Allocation-Moderate Growth VP | 66,156 | 14.45 | ||||||
Transamerica Asset Allocation-Moderate VP | 73,511 | 16.05 | ||||||
Total | $ | 415,177 | 90.66 | % | ||||
Transamerica Money Market | Net Assets | % of Net Assets | ||||||
Transamerica Asset Allocation-Conservative Portfolio | $ | 9,000 | 3.31 | % | ||||
Transamerica Asset Allocation-Growth Portfolio | 2,868 | 1.06 | ||||||
Transamerica Asset Allocation-Moderate Portfolio | 2,425 | 0.89 | ||||||
Transamerica Asset Allocation-Moderate Growth Portfolio | 2,614 | 0.96 | ||||||
Transamerica Multi-Manager Alternative Strategies Portfolio | 12,159 | 4.47 | ||||||
Total | $ | 29,066 | 10.69 | % | ||||
Transamerica Science & Technology | Net Assets | % of Net Assets | ||||||
Transamerica Asset Allocation-Conservative Portfolio | $ | 2,610 | 4.88 | % | ||||
Transamerica Asset Allocation-Growth Portfolio | 12,377 | 23.13 | ||||||
Transamerica Asset Allocation-Moderate Portfolio | 8,601 | 16.07 | ||||||
Transamerica Asset Allocation-Moderate Growth Portfolio | 22,347 | 41.76 | ||||||
Total | $ | 45,935 | 85.84 | % | ||||
Transamerica Short-Term Bond | Net Assets | % of Net Assets | ||||||
Transamerica Asset Allocation-Conservative Portfolio | $ | 49,722 | 9.84 | % | ||||
Transamerica Asset Allocation-Moderate Portfolio | 81,857 | 16.20 | ||||||
Transamerica Asset Allocation-Moderate Growth Portfolio | 85,649 | 16.95 | ||||||
Transamerica Asset Allocation-Conservative VP | 56,316 | 11.15 | ||||||
Transamerica Asset Allocation-Moderate Growth VP | 105,209 | 20.82 | ||||||
Transamerica Asset Allocation-Moderate VP | 103,382 | 20.46 | ||||||
Transamerica International Moderate Growth VP | 6,649 | 1.32 | ||||||
Total | $ | 488,784 | 96.74 | % | ||||
Transamerica Small/Mid Cap Value | Net Assets | % of Net Assets | ||||||
Transamerica Asset Allocation-Conservative Portfolio | $ | 8,376 | 1.55 | % | ||||
Transamerica Asset Allocation-Growth Portfolio | 67,181 | 12.42 | ||||||
Transamerica Asset Allocation-Moderate Portfolio | 65,374 | 12.08 | ||||||
Transamerica Asset Allocation-Moderate Growth Portfolio | 62,756 | 11.60 | ||||||
Total | $ | 203,687 | 37.65 | % | ||||
112
NOTES TO FINANCIAL STATEMENTS (continued)
At October 31, 2008
(all amounts in thousands)
At October 31, 2008
(all amounts in thousands)
NOTE 2. (continued)
Investment advisory fees: The Funds pay management fees to TAM based on average daily net assets (“ANA”) at the following breakpoints:
Transamerica Balanced | ||||
First $250 million | 0.80 | % | ||
Over $250 million up to $500 million | 0.75 | % | ||
Over $500 million up to $1.5 billion | 0.70 | % | ||
Over $1.5 billion | 0.625 | % | ||
Transamerica Convertible Securities | ||||
First $250 million | 0.75 | % | ||
Over $250 million | 0.70 | % | ||
Transamerica Equity | ||||
First $500 million | 0.75 | % | ||
Over $500 million up to $2.5 billion | 0.70 | % | ||
Over $2.5 billion | 0.65 | % | ||
Transamerica Flexible Income | ||||
First $250 million | 0.725 | % | ||
Over $250 million up to $350 million | 0.675 | % | ||
Over $350 million | 0.625 | % | ||
Transamerica Growth Opportunities | ||||
First $250 million | 0.80 | % | ||
Over $250 million up to $500 million | 0.75 | % | ||
Over $500 million | 0.70 | % | ||
Transamerica High Yield Bond | ||||
First $400 million | 0.59 | % | ||
Over $400 million up to $750 million | 0.575 | % | ||
Over $750 million | 0.55 | % | ||
Transamerica Legg Mason Partners All Cap | ||||
First $500 million | 0.80 | % | ||
Over $500 million | 0.675 | % | ||
Transamerica Money Market | ||||
Average daily net assets | 0.40 | % | ||
Transamerica Science & Technology | ||||
First $500 million | 0.78 | % | ||
Over $500 million | 0.70 | % | ||
Transamerica Short-Term Bond | ||||
First $250 million | 0.65 | % | ||
Over $250 million up to $500 million | 0.60 | % | ||
Over $500 million up to $1 billion | 0.575 | % | ||
Over $1 billion | 0.55 | % | ||
Transamerica Small/Mid Cap Value | ||||
First $500 million | 0.80 | % | ||
Over $500 million | 0.75 | % | ||
Transamerica Templeton Global | ||||
First $500 million | 0.80 | % | ||
Over $500 million | 0.70 | % | ||
Transamerica Value Balanced | ||||
First $500 million | 0.75 | % | ||
Over $500 million up to $1 billion | 0.65 | % | ||
Over $1 billion | 0.60 | % |
TAM has contractually agreed to waive its advisory fee and will reimburse the Funds to the extent that operating expenses, excluding 12b-1 fees, exceed the following stated annual limit:
Expense | ||||
Fund | Limit | |||
Transamerica Balanced | 1.45 | % | ||
Transamerica Convertible Securities | 1.35 | |||
Transamerica Equity* | 1.17 | |||
Transamerica Flexible Income | 1.50 | |||
Transamerica Growth Opportunities* | 1.40 | |||
Transamerica High Yield Bond* | 1.24 | |||
Transamerica Legg Mason Partners All Cap* | 1.20 | |||
Transamerica Money Market | 0.48 | |||
Transamerica Science & Technology | 1.18 | |||
Transamerica Short-Term Bond | 0.85 | |||
Transamerica Small/Mid Cap Value | 1.40 | |||
Transamerica Templeton Global | 1.20 | |||
Transamerica Value Balanced* | 1.20 |
* | The Fund may not recapture any fees waived and/or reimbursed prior to March 1, 2008. |
If total Fund expenses fall below the annual expense limitation agreement agreed to by the adviser within the succeeding three years, the Funds may be required to pay the adviser a portion or all of the reimbursed class expenses.
There were no amounts recaptured at October 31, 2008.
The following amounts were available for recapture at October 31, 2008:
Transamerica | Reimbursement of | Available for | ||||||
Equity | Class Expenses | Recapture Through | ||||||
Fiscal Year 2008: | 10/31/2011 | |||||||
Class B | $ | 54 |
Transamerica Growth | Reimbursement of | Available for | ||||||
Opportunities | Class Expenses | Recapture Through | ||||||
Fiscal Year 2008: | 10/31/2011 | |||||||
Class A | $ | 31 | ||||||
Class B | 27 |
Transamerica Legg | Reimbursement of | Available for | ||||||
Mason Partners All Cap | Class Expenses | Recapture Through | ||||||
Fiscal Year 2008: | 10/31/2011 | |||||||
Class A | $ | 17 | ||||||
Class B | 24 |
Transamerica | Reimbursement of | Available for | ||||||
Money Market | Class Expenses | Recapture Through | ||||||
Fiscal Year 2008: | 10/31/2011 | |||||||
Class A | $ | 276 | ||||||
Class B | 71 | |||||||
Class C | 62 | |||||||
Class I | 2 | |||||||
Fiscal Year 2007: | 10/31/2010 | |||||||
Class A | 321 | |||||||
Class B | 88 | |||||||
Class C | 45 | |||||||
Class I | 18 | |||||||
Fiscal Year 2006: | 10/31/2009 | |||||||
Class A | 290 | |||||||
Class B | 81 | |||||||
Class C | 47 |
113
NOTES TO FINANCIAL STATEMENTS (Continued)
At October 31, 2008
(all amounts in thousands)
At October 31, 2008
(all amounts in thousands)
NOTE 2. (continued)
Transamerica | Reimbursement of | Available for | ||||||
Science & Technology | Class Expenses | Recapture Through | ||||||
Fiscal Year 2008: | 10/31/2011 | |||||||
Class A | $ | 11 | ||||||
Class B | 12 | |||||||
Class C | 3 | |||||||
Fiscal Year 2007: | 10/31/2010 | |||||||
Class A | 13 | |||||||
Class B | 14 | |||||||
Class C | 4 | |||||||
Fiscal Year 2006: | 10/31/2009 | |||||||
Class A | 12 | |||||||
Class B | 19 | |||||||
Class C | 4 |
Transamerica | Reimbursement of | Available for | ||||||
Templeton Global | Class Expenses | Recapture Through | ||||||
Fiscal Year 2008: | 10/31/2011 | |||||||
Class A | $ | 66 | ||||||
Class B | 82 | |||||||
Class C | 14 | |||||||
Fiscal Year 2007: | 10/31/2010 | |||||||
Class A | 94 | |||||||
Class B | 131 | |||||||
Class C | 35 | |||||||
Fiscal Year 2006: | 10/31/2009 | |||||||
Class A | 97 | |||||||
Class B | 184 | |||||||
Class C | 53 |
Transamerica Value | Reimbursement of | Available for | ||||||
Balanced | Class Expenses | Recapture Through | ||||||
Fiscal Year 2008: | 10/31/2011 | |||||||
Class A | $ | 3 | ||||||
Class B | 11 |
Distribution and service fees: The Funds have 12b-1 distribution plans under the 1940 Act pursuant to which an annual fee, based on average daily net assets, is paid to the distributor for various disbursements such as broker-dealer account servicing fees and other promotional expenses of the Funds. The Funds are authorized under the 12b-1 plans to pay fees on each class up to the following limits: 0.35% for Class A, 1.00% for Class B, and 1.00% for Class C. 12b-1 fees are not applicable for Class I and Class T.
Underwriter commissions relate to front-end sales charges imposed for Class A shares and contingent deferred sales charges from Class B, Class C, and certain Class A share redemptions. For the year ended October 31, 2008, the underwriter commissions were as follows:
Transamerica Balanced | ||||
Received by Underwriter | $ | 65 | ||
Retained by Underwriter | 10 | |||
Contingent Deferred Sales Charge | 49 | |||
Transamerica Convertible Securities | ||||
Received by Underwriter | $ | 68 | ||
Retained by Underwriter | 12 | |||
Contingent Deferred Sales Charge | 14 | |||
Transamerica Equity | ||||
Received by Underwriter | $ | 408 | ||
Retained by Underwriter | 62 | |||
Contingent Deferred Sales Charge | 105 | |||
Transamerica Flexible Income | ||||
Received by Underwriter | $ | 36 | ||
Retained by Underwriter | 7 | |||
Contingent Deferred Sales Charge | 24 | |||
Transamerica Growth Opportunities | ||||
Received by Underwriter | $ | 76 | ||
Retained by Underwriter | 12 | |||
Contingent Deferred Sales Charge | 30 | |||
Transamerica High Yield Bond | ||||
Received by Underwriter | $ | 88 | ||
Retained by Underwriter | 18 | |||
Contingent Deferred Sales Charge | 31 | |||
Transamerica Legg Mason Partners All Cap | ||||
Received by Underwriter | $ | 42 | ||
Retained by Underwriter | 6 | |||
Contingent Deferred Sales Charge | 72 | |||
Transamerica Money Market | ||||
Received by Underwriter* | $ | — | ||
Retained by Underwriter* | — | |||
Contingent Deferred Sales Charge | 141 | |||
Transamerica Science & Technology | ||||
Received by Underwriter | $ | 26 | ||
Retained by Underwriter | 4 | |||
Contingent Deferred Sales Charge | 3 | |||
Transamerica Short-Term Bond | ||||
Received by Underwriter | $ | 33 | ||
Retained by Underwriter | 6 | |||
Contingent Deferred Sales Charge | 1 | |||
Transamerica Small/Mid Cap Value | ||||
Received by Underwriter | $ | 1,099 | ||
Retained by Underwriter | 165 | |||
Contingent Deferred Sales Charge | 136 | |||
Transamerica Templeton Global | ||||
Received by Underwriter | $ | 68 | ||
Retained by Underwriter | 11 | |||
Contingent Deferred Sales Charge | 22 | |||
Transamerica Value Balanced | ||||
Received by Underwriter | $ | 21 | ||
Retained by Underwriter | 3 | |||
Contingent Deferred Sales Charge | 12 |
* | Rounds to less than $1. |
Administrative services: The Funds have entered into agreements with TFS for financial and legal fund administration services. The Funds pay TFS an annual fee of 0.02% of ANA. The Legal fees on the Statements of Operations are for fees paid to external legal counsel.
Transfer agent fees: The Funds pay TFS an annual per-account charge for each open and closed account. The Funds paid TFS the following for the year ended October 31, 2008:
Fund | Fees | |||
Transamerica Balanced | $ | 403 | ||
Transamerica Convertible Securities | 34 | |||
Transamerica Equity | 2,188 | |||
Transamerica Flexible Income | 92 | |||
Transamerica Growth Opportunities | 651 | |||
Transamerica High Yield Bond | 98 | |||
Transamerica Legg Mason Partners All Cap | 409 | |||
Transamerica Money Market | 365 | |||
Transamerica Science & Technology | 57 | |||
Transamerica Short-Term Bond | 2 | |||
Transamerica Small/Mid Cap Value | 619 | |||
Transamerica Templeton Global | 685 | |||
Transamerica Value Balanced | 140 |
114
NOTES TO FINANCIAL STATEMENTS (continued)
At October 31, 2008
(all amounts in thousands)
At October 31, 2008
(all amounts in thousands)
NOTE 2. (continued)
Brokerage commissions: There were no brokerage commissions incurred on security transactions placed with affiliates of the advisers for the year ended October 31, 2008.
Deferred compensation plan: Each eligible Independent Fund Trustee may elect to participate in a non-qualified deferred compensation plan (the “Plan”) maintained by Transamerica Funds. Under the Plan, such Trustees may defer payment of all or a portion of their total fees earned as a Fund Trustee. Each Trustee who is a participant in the Plan may elect that the earnings, losses or gains credited to his or her deferred fee amounts be determined based on a deemed investment in Class A shares of any series of Transamerica Funds, including the Funds, or investment options under Transamerica Partners Institutional Funds Group or Transamerica Institutional Asset Allocation Funds, or funds of Transamerica Investors, Inc. The right of a participant to receive a distribution from the Plan of the deferred fees is an unsecured claim against the general assets of all series of Transamerica Funds. The pro rata liability to the Funds of all deferred fees in the Plan as of October 31, 2008, amounted to the following:
Fund | Deferred Fees | |||
Transamerica Balanced | $ | 5 | ||
Transamerica Convertible Securities | 5 | |||
Transamerica Equity | 51 | |||
Transamerica Flexible Income | 12 | |||
Transamerica Growth Opportunities | 9 | |||
Transamerica High Yield Bond | 15 | |||
Transamerica Legg Mason Partners All Cap | 4 | |||
Transamerica Money Market | 7 | |||
Transamerica Science & Technology | 3 | |||
Transamerica Short-Term Bond | 19 | |||
Transamerica Small/Mid Cap Value | 24 | |||
Transamerica Templeton Global | 6 | |||
Transamerica Value Balanced | 2 |
Retirement plan: Under a prior retirement plan (the “Emeritus Plan”) available to the Independent Trustees, each Independent Trustee is deemed to have elected to serve as Trustee Emeritus of Transamerica Funds upon his or her termination of service, other than removal for cause, for a maximum period of five years determined by his or her years of service as a Trustee.
Such amounts shall be accrued by Transamerica Funds on a pro rata basis allocable to each Transamerica Fund based on the relative assets of the Fund. If retainers increase in the future, past accruals (and credits) will be adjusted upward so that 50% of the Trustee’s current retainer is accrued and credited at all times. Upon death, disability or termination of service, other than removal for cause, amounts deferred become payable to a Trustee Emeritus (or his/her beneficiary). Upon the commencement of service as Trustee Emeritus, compensation will be paid on a quarterly basis during the time period that the Trustee Emeritus is allowed to serve as such.
At October 31, 2008, the Funds’ liabilities related to the Emeritus Plan were as follows:
Fund | Emeritus Fees | |||
Transamerica Balanced | $ | 3 | ||
Transamerica Convertible Securities | 3 | |||
Transamerica Equity | 23 | |||
Transamerica Flexible Income | 4 | |||
Transamerica Growth Opportunities | 5 | |||
Transamerica High Yield Bond | 5 | |||
Transamerica Legg Mason Partners All Cap | 3 | |||
Transamerica Money Market | 2 | |||
Transamerica Science & Technology | 1 | |||
Transamerica Short-Term Bond | 4 | |||
Transamerica Small/Mid Cap Value | 7 | |||
Transamerica Templeton Global | 4 | |||
Transamerica Value Balanced | 1 |
Amounts deferred and accrued under the Emeritus Plan are unfunded and unsecured claims against the general assets of Transamerica Funds.
The Emeritus Plan was terminated effective October 30, 2007. Upon the termination, the Funds shall continue to pay any remaining benefits in accordance with the Plan, but no further compensation shall accrue under the Plan.
NOTE 3. INVESTMENT TRANSACTIONS
The cost of securities purchased and proceeds from securities sold (excluding short-term securities) for the year ended October 31, 2008 were as follows:
Proceeds from | ||||||||||||||||
Purchases of | maturities and sales of | |||||||||||||||
securities: | securities: | |||||||||||||||
U.S. | U.S. | |||||||||||||||
Fund | Long-term | Government | Long-term | Government | ||||||||||||
Transamerica Balanced | $ | 55,746 | $ | 24,793 | $ | 86,280 | $ | 27,942 | ||||||||
Transamerica Convertible Securities | 131,498 | — | 135,746 | — | ||||||||||||
Transamerica Equity | 504,933 | — | 643,721 | — | ||||||||||||
Transamerica Flexible Income | 156,463 | 185,692 | 327,485 | 204,119 | ||||||||||||
Transamerica Growth Opportunities | 121,337 | — | 183,044 | — | ||||||||||||
Transamerica High Yield Bond | 392,081 | — | 167,966 | — | ||||||||||||
Transamerica Legg Mason Partners All Cap | 36,586 | — | 82,157 | — | ||||||||||||
Transamerica Science &-Technology | 38,728 | — | 40,590 | — | ||||||||||||
Transamerica Short-Term Bond | 265,480 | 101,901 | 469,988 | 4,984 | ||||||||||||
Transamerica Small/Mid Cap Value | 563,242 | — | 337,743 | — | ||||||||||||
Transamerica Templeton Global | 51,468 | — | 119,372 | — | ||||||||||||
Transamerica Value Balanced | 18,351 | 6,576 | 33,926 | 6,176 |
115
NOTES TO FINANCIAL STATEMENTS (continued)
At October 31, 2008
(all amounts in thousands)
At October 31, 2008
(all amounts in thousands)
NOTE 4. FEDERAL INCOME TAX MATTERS
The Funds have not made any provisions for federal income or excise taxes due to their policy to distribute all of their taxable income and capital gains to their shareholders and otherwise qualify as regulated investment companies under Subchapter M of the Internal Revenue Code. Management has evaluated the Funds’ tax provisions taken for all open tax years and has concluded that no provision for income tax is required in the Funds’ financial statements. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP. These differences are primarily due to differing treatment for items including, but not limited to, wash sales, structured notes, foreign bonds, swaps, net operating losses and distribution reclasses.
Therefore, distributions determined in accordance with tax regulations may differ significantly in amount or character from net investment income and realized gains for financial reporting purposes. Financial reporting records are adjusted for permanent book/tax differences to reflect tax character. Financial records are not adjusted for temporary differences. These reclassifications are as follows:
Undistributed | ||||||||||||
Shares of | (accumulated) | |||||||||||
beneficial | net realized | |||||||||||
interest, | Undistributed | gain (loss) | ||||||||||
unlimited | (accumulated) net | from | ||||||||||
shares | investment | investment | ||||||||||
Fund | authorized | income (loss) | securities | |||||||||
Transamerica Convertible Securities | $ | — | $ | 32 | $ | (32 | ) | |||||
Transamerica Equity | (192,099 | ) | — | 192,099 | ||||||||
Transamerica Flexible Income | — | 256 | (256 | ) | ||||||||
Transamerica Growth Opportunities | (57,454 | ) | 933 | 56,521 | ||||||||
Transamerica High Yield Bond | — | 34 | (34 | ) | ||||||||
Transamerica Science & Technology | (435 | ) | 434 | 1 | ||||||||
Transamerica Small/Mid Cap Value | — | (610 | ) | 610 | ||||||||
Transamerica Templeton Global | 3 | 714 | (717 | ) | ||||||||
Transamerica Value Balanced | (39 | ) | 81 | (42 | ) |
The capital loss carryforwards are available to offset future realized capital gains through the periods listed:
Capital Loss | ||||||
Fund | Carryforwards | Available Through | ||||
Transamerica Convertible Securities | $ | 17,338 | October 31, 2016 | |||
Transamerica Equity | 308,384 | October 31, 2009 | ||||
Transamerica Equity | 94,612 | October 31, 2010 | ||||
Transamerica Equity | 52,413 | October 31, 2016 | ||||
Transamerica Flexible Income | 890 | October 31, 2013 | ||||
Transamerica Flexible Income | 5,058 | October 31, 2014 | ||||
Transamerica Flexible Income | 6,946 | October 31, 2015 | ||||
Transamerica Flexible Income | 34,692 | October 31, 2016 | ||||
Transamerica Growth Opportunities | 99,199 | October 31, 2009 | ||||
Transamerica Growth Opportunities | 4,618 | October 31, 2010 | ||||
Transamerica Growth Opportunities | 7,437 | October 31, 2011 | ||||
Transamerica Growth Opportunities | 20,381 | October 31, 2016 | ||||
Transamerica High Yield Bond | 1,546 | October 31, 2011 | ||||
Transamerica High Yield Bond | 9,181 | October 31, 2016 | ||||
Transamerica Legg Mason Partners All Cap | 2,284 | October 31, 2016 | ||||
Transamerica Money Market | 1 | October 31, 2013 | ||||
Transamerica Money Market | 1 | October 31, 2014 | ||||
Transamerica Science & Technology | 505 | October 31, 2016 | ||||
Transamerica Short-Term Bond | 658 | October 31, 2013 | ||||
Transamerica Short-Term Bond | 1,787 | October 31, 2014 | ||||
Transamerica Short-Term Bond | 1,304 | October 31, 2015 | ||||
Transamerica Short-Term Bond | 10,368 | October 31, 2016 | ||||
Transamerica Small/Mid Cap Value | 99,045 | October 31, 2016 | ||||
Transamerica Templeton Global | 33,614 | October 31, 2009 | ||||
Transamerica Templeton Global | 205,203 | October 31, 2010 | ||||
Transamerica Templeton Global | 57,944 | October 31, 2011 | ||||
Transamerica Value Balanced | 3,722 | October 31, 2016 |
Funds not listed in the above table did not have any capital loss carryforwards.
The capital loss carryforwards utilized or expired during the year ended October 31, 2008 was as follows:
Capital Loss Carryforwards | ||||
Utilized/Expired During the | ||||
Fund | Year Ended October 31, 2008 | |||
Transamerica Equity | $ | 192,099 | ||
Transamerica Growth Opportunities | 56,518 | |||
Transamerica Templeton Global | 11,313 |
116
NOTES TO FINANCIAL STATEMENTS (continued)
At October 31, 2008
(all amounts in thousands)
At October 31, 2008
(all amounts in thousands)
NOTE 4. (continued)
The tax character of distributions paid may differ from the character of distributions shown in the Statements of Changes in Net Assets due to short-term gains being treated as ordinary income for tax purposes. The tax character of distributions paid during 2007 and 2008 was as follows:
Distributions Paid | Distributions Paid | |||||||||||||||
From: 2007 | From: 2008 | |||||||||||||||
Long- | Long- | |||||||||||||||
term | term | |||||||||||||||
Ordinary | Capital | Ordinary | Capital | |||||||||||||
income | Gain | income | Gain | |||||||||||||
Transamerica Balanced | $ | 571 | $ | — | $ | 1,146 | $ | 4,811 | ||||||||
Transamerica Convertible Securities | 2,509 | 14,409 | 10,032 | 28,135 | ||||||||||||
Transamerica Flexible Income | 20,040 | — | 20,665 | $ | — | |||||||||||
Transamerica High Yield Bond | 26,450 | — | 35,509 | — | ||||||||||||
Transamerica Legg Mason Partners All Cap | 390 | 29,704 | 440 | 14,797 | ||||||||||||
Transamerica Money Market | 7,678 | — | 4,684 | — | ||||||||||||
Transamerica Science & Technology | — | — | — | 3,111 | ||||||||||||
Transamerica Short-Term Bond | 22,977 | — | 25,117 | — | ||||||||||||
Transamerica Small/Mid Cap Value | 8,052 | 9,021 | 6,446 | 75,840 | ||||||||||||
Transamerica Templeton Global | 2,533 | — | 2,122 | — | ||||||||||||
Transamerica Value Balanced | 864 | 1,791 | 1,133 | 2,932 |
The tax basis components of distributable earnings as of October 31, 2008 are as follows:
Net | ||||||||||||||||||||
Undistributed | Undistributed | Other | Unrealized | |||||||||||||||||
Ordinary | Long-term | Capital Loss | Temporary | Appreciation | ||||||||||||||||
Fund | income | Capital Gain | Carryforward | Differences | (Depreciation) | |||||||||||||||
Transamerica Balanced | $ | 215 | $ | 6,058 | $ | — | $ | (26 | ) | $ | (18,094 | ) | ||||||||
Transamerica Convertible Securities | 520 | — | (17,338 | ) | — | (23,254 | ) | |||||||||||||
Transamerica Equity | 2,780 | — | (455,409 | ) | (411 | ) | (224,269 | ) | ||||||||||||
Transamerica Flexible Income | 811 | — | (47,586 | ) | (6 | ) | (31,638 | ) | ||||||||||||
Transamerica Growth Opportunities | — | — | (131,635 | ) | (17 | ) | (32,033 | ) | ||||||||||||
Transamerica High Yield Bond | 3,083 | — | (10,727 | ) | (15 | ) | (177,667 | ) | ||||||||||||
Transamerica Legg Mason Partners All Cap | 533 | — | (2,284 | ) | (7 | ) | (10,758 | ) | ||||||||||||
Transamerica Money Market | 305 | — | (2 | ) | (220 | ) | — | |||||||||||||
Transamerica Science & Technology | — | — | (505 | ) | (1 | ) | (15,090 | ) | ||||||||||||
Transamerica Short-Term Bond | 1,333 | — | (14,117 | ) | — | (20,790 | ) | |||||||||||||
Transamerica Small/Mid Cap Value | 7,852 | — | (99,045 | ) | (1 | ) | (67,642 | ) | ||||||||||||
Transamerica Templeton Global | 545 | — | (296,761 | ) | (115 | ) | (35,942 | ) | ||||||||||||
Transamerica Value Balanced | $ | 24 | $ | — | $ | (3,722 | ) | $ | (12 | ) | $ | (1,077 | ) |
NOTE 5. ACCOUNTING PRONOUNCEMENT
In March 2008, the FASB issued its new Standard No. 161, “Disclosure About Derivative Instruments and Hedging Activities” (“FAS 161”). FAS 161 is effective for fiscal years and interim periods beginning after November 15, 2008. FAS 161 requires enhanced disclosures about a Fund’s derivative and hedging activities. Management is currently evaluating the impact the adoption of FAS 161 will have on the Funds’ financial statement disclosures.
NOTE 6. SUBSEQUENT EVENT
On November 24, 2008, the Treasury announced an extension of Treasury’s Temporary Guarantee Program for Money Market Funds until April 30, 2009 to support ongoing stability in the market. The Transamerica Money Market Fund elected to re-enroll in this Program.
117
Report of Independent Registered Certified Public Accounting Firm
To the Board of Trustees and Shareholders of Transamerica Balanced, Transamerica Convertible Securities, Transamerica Equity, Transamerica Flexible Income, Transamerica Growth Opportunities, Transamerica High Yield Bond, Transamerica Legg Mason Partners All Cap, Transamerica Money Market, Transamerica Science & Technology, Transamerica Short-Term Bond, Transamerica Small/Mid Cap Value, Transamerica Templeton Global, and Transamerica Value Balanced:
In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of Transamerica Balanced, Transamerica Convertible Securities, Transamerica Equity, Transamerica Flexible Income, Transamerica Growth Opportunities, Transamerica High Yield Bond, Transamerica Legg Mason Partners All Cap, Transamerica Money Market, Transamerica Science & Technology, Transamerica Short-Term Bond, Transamerica Small/Mid Cap Value, Transamerica Templeton Global, and Transamerica Value Balanced (individually a “Fund”, collectively the “Funds”) at October 31, 2008, and the results of each of their operations, the changes in each of their net assets and the financial highlights for each of the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as “financial statements”) are the responsibility of the Funds’ management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements 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 are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at October 31, 2008 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
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Tampa, Florida
December 29, 2008
December 29, 2008
118
SUPPLEMENTAL INFORMATION (unaudited)
TAX INFORMATION
For dividends paid during the year ended October 31, 2008, the Funds designated the following as qualified dividend income:
Qualified Dividend | ||||
Fund | Income | |||
Transamerica Balanced | $ | 1,146 | ||
Transamerica Convertible Securities | 1,004 | |||
Transamerica Flexible Income | 402 | |||
Transamerica Legg Mason Partners All Cap | 440 | |||
Transamerica Small/Mid Cap Value | 6,446 | |||
Transamerica Templeton Global | 2,122 | |||
Transamerica Value Balanced | 930 |
For corporate shareholders, investment income (dividend income plus short-term gains, if any) qualifies for the dividends received deductions as follows:
Dividend Received | ||||
Fund | Deduction Percentage | |||
Transamerica Balanced | 100.00 | % | ||
Transamerica Convertible Securities | 10.14 | % | ||
Transamerica Flexible Income | 1.56 | % | ||
Transamerica Legg Mason Partners All Cap | 100.00 | % | ||
Transamerica Small/Mid Cap Value | 100.00 | % | ||
Transamerica Templeton Global | 18.95 | % | ||
Transamerica Value Balanced | 85.38 | % |
For tax purposes, the Long-Term Capital Gain Designations for the year ended October 31, 2008 were as follows:
Long-Term Capital | ||||
Fund | Designation | |||
Transamerica Balanced | $ | 4,811 | ||
Transamerica Convertible Securities | 28,135 | |||
Transamerica Legg Mason Partners All Cap | 14,798 | |||
Transamerica Science & Technology | 3,111 | |||
Transamerica Small/Mid Cap Value | 75,840 | |||
Transamerica Value Balanced | 2,932 |
The information and distributions reported herein may differ from the information and distributions taxable to the shareholders for the calendar year ending December 31, 2008. Complete information will be computed and reported in conjunction with your 2008 Form 1099-DIV.
119
TRANSAMERICA FUNDS
Management of the Funds
The Board Members and executive officers of the Trust are listed below. The Board governs each Fund and is responsible for protecting the interests of the shareholders. The Board Members are experienced executives who meet periodically throughout the year to oversee the business affairs of each Fund and the operation of the Trust by its officers. The Board also reviews the management of each Fund’s assets by the investment adviser and its respective sub-adviser. The Funds are among the funds advised and sponsored by TAM (collectively, the “Transamerica Asset Management Group, Inc.”). The Transamerica Asset Management Group (“TAMG”) consists of Transamerica Funds, Transamerica Series Trust (“TST”), Transamerica Investors, Inc. (“TII”), Transamerica Income Shares, Inc. (“TIS”), Transamerica Partners Funds Group (“TPFG”), Transamerica Partners Funds Group II (“TPFG II”), Transamerica Partners Portfolios (“TPP”), and Transamerica Asset Allocation Variable Funds (“TAAVF”).
The mailing address of each Board Member is c/o Secretary of the Funds, 570 Carillon Parkway, St. Petersburg, Florida 33716. The Board Members, their ages and their principal occupations for the past five years (their titles may have varied during that period), the number of funds in TAMG the Board oversees, and other board memberships they hold are set forth in the table below.
Term of | ||||||||||||
Office | ||||||||||||
and | Number of | |||||||||||
Length | Funds in | |||||||||||
of Time | Principal Occupation(s) During | Complex | Other | |||||||||
Name and Age | Position | Served* | Past 5 Years | Overseen | Directorships | |||||||
INTERESTED BOARD MEMBER** | ||||||||||||
John K. Carter (DOB: 4/24/61) | Chairman, Board Member, President, and Chief Executive Officer | 2006 — present | Chairman and Board Member (2008 — present), President (2007 — present), Chief Executive Officer (2006 — present), Vice President, Secretary and Chief Compliance Officer (2003 — 2006), TII; Chairman, Board Member, President and Chief Executive Officer, TPP, TPFG, TPFG II and TAAVF (2007 — present); Chairman (2007 — present), Board Member (2006 — present), President and Chief Executive Officer (2006 — present), Senior Vice President (1999 — 2006), Chief Compliance Officer, General Counsel and Secretary (1999 — 2006), Transamerica Funds and TST; Chairman (2007 — present), Board Member (2006 — present), President and Chief Executive Officer (2006 — present), Senior Vice President (2002 — 2006), General Counsel, Secretary and Chief Compliance Officer (2002 — 2006), TIS; President and Chief Executive Officer (2006 — present), Senior Vice President (1999 — 2006), Director (2000 — present), General Counsel and Secretary (2000 — 2006), Chief Compliance Officer (2004 — 2006), TAM; President and Chief Executive Officer (2006 — present), Senior Vice President (1999 — 2006), Director (2001 — present), General Counsel and Secretary (2001 — 2006), Transamerica Fund Services, Inc. (“TFS”); Vice President, AFSG Securities Corporation (2001 -present); Senior Vice President, General Counsel and Secretary, Transamerica Index Funds, Inc. (“TIF”) (2002 — 2004); and Vice President, Transamerica Investment Services, Inc. (“TISI”) (2003 — 2005) and TIM (2001 — 2005). | 176 | N/A |
120
Term of | ||||||||||||
Office | ||||||||||||
and | Number of | |||||||||||
Length | Funds in | |||||||||||
of Time | Principal Occupation(s) During | Complex | Other | |||||||||
Name and Age | Position | Served* | Past 5 Years | Overseen | Directorships | |||||||
INDEPENDENT BOARD MEMBERS*** | ||||||||||||
Sandra N. Bane (DOB: 6/13/52) | Board Member | 2008 — present | Retired, KPMG (1999 — present); and Board Member, TII (2003 — present), Transamerica Funds, TST, TIS, TPP, TPFG, TPFG II and TAAVF (March 2008 — present). | 176 | Big 5 Sporting Goods (2002 — present); AGL Resources, Inc. (energy services holding company) (2008 — present) | |||||||
Leo J. Hill (DOB: 3/27/56) | Board Member | 2002 — present | Principal, Advisor Network Solutions, LLC (business consulting) (2006 — present); Board Member, TST (2001 — present); Board Member, Transamerica Funds and TIS (2002 — present); Board Member, TPP, TPFG, TPFG II and TAAVF (2007 — present); TII (February 2008 — present); Owner and President, Prestige Automotive Group (2001 — 2005); President, L. J. Hill & Company (1999 — present); Market President, Nations Bank of Sun Coast Florida (1998 — 1999); President and Chief Executive Officer, Barnett Banks of Treasure Coast Florida (1994 — 1998); Executive Vice President and Senior Credit Officer, Barnett Banks of Jacksonville, Florida (1991 — 1994); and Senior Vice President and Senior Loan Administration Officer, Wachovia Bank of Georgia (1976 — 1991). | 176 | N/A | |||||||
Neal M. Jewell (DOB: 2/12/35) | Lead Independent Board Member | 2007 — present | Retired (2004 — present); Lead Independent Board Member, TPP, TPFG, TPFG II and TAAVF (1993 — present); Lead Independent Board Member, Transamerica Funds, TST and TIS (2007 — present); Lead Independent Board Member, TII (February 2008 — present); and Independent Trustee, EAI Select Managers Equity Fund (a mutual fund) (1996 — 2004). | 176 | N/A | |||||||
Russell A. Kimball, Jr. (DOB: 8/17/44) | Board Member | 2002 — present | General Manager, Sheraton Sand Key Resort (1975 — present); Board Member, TST (1986 — present); Board Member, Transamerica Funds and TIS (2002 — present); TPP, TPFG, TPFG II and TAAVF (2007 — present); and Board Member, TII (February 2008 — present). | 176 | N/A |
121
Term of | ||||||||||||
Office | ||||||||||||
and | Number of | |||||||||||
Length | Funds in | |||||||||||
of Time | Principal Occupation(s) During | Complex | Other | |||||||||
Name and Age | Position | Served* | Past 5 Years | Overseen | Directorships | |||||||
Eugene M. Mannella (DOB: 2/1/54) | Board Member | 2007 — present | Chief Executive Officer, Hedge Fund Services, LLC (hedge fund administration) (January 2008 — present); Self-employed consultant (2006 — present); President, ARAPAHO Partners LLC (limited purpose broker-dealer) (1998 — present); Board Member, TPP, TPFG, TPFG II and TAAVF (1994 — present); Board Member, Transamerica Funds, TIS and TST (2007 — present); Board Member, TII (February 2008 — present); and President, International Fund Services (alternative asset administration) (1993 — 2005). | 176 | N/A | |||||||
Norm R. Nielsen (DOB: 5/11/39) | Board Member | 2006 — present | Retired (2005 — present); Board Member, Transamerica Funds, TST and TIS (2006 — present); Board Member, TPP, TPFG, TPFG II and TAAVF (2007 — present); Board Member, TII (February 2008 — present); Director, Iowa City Area Development (1996 — 2004); Director, Iowa Health Systems (1994 — 2003); Director, U.S. Bank (1987 — 1988); and President, Kirkwood Community College (1979 — 2005). | 176 | Buena Vista University Board of Trustees (2004 — present) | |||||||
Joyce Galpern Norden (DOB: 6/1/39) | Board Member | 2007 — present | Retired (2004 — present); Board Member, TPFG, TPFG II and TAAVF (1993 — present); Board Member, TPP (2002 — present); Board Member, Transamerica Funds, TST and TIS (2007 — present); Board Member, TII (February 2008 — present); and Vice President, Institutional Advancement, Reconstructionist Rabbinical College (1996 — 2004). | 176 | Board of Governors, Reconstructionist Rabbinical College (2007 — present) | |||||||
Patricia L. Sawyer (DOB: 7/1/50) | Board Member | 2007 — present | President and Executive Search Consultant, Smith & Sawyer LLC (consulting) (1989 — present); Board Member, Transamerica Funds and TST (2007 — present); Board Member, TIS (2007 — present); Board Member, TII (2008 — present); and Board Member, TPP, TPFG, TPFG II and TAAVF (1993 — present). | 176 | N/A |
122
Term of | ||||||||||||
Office | ||||||||||||
and | Number of | |||||||||||
Length | Funds in | |||||||||||
of Time | Principal Occupation(s) During | Complex | Other | |||||||||
Name and Age | Position | Served* | Past 5 Years | Overseen | Directorships | |||||||
John W. Waechter (DOB: 2/25/52) | Board Member | 2005 — present | Attorney, Englander & Fischer, P.A. (March 2008 — present); Retired (2004 — March 2008); Board Member, TST and TIS (2004 — present); Board Member, Transamerica Funds (2005 — present); Board Member, TPP, TPFG, TPFG II and TAAVF (2007 — present); Board Member, TII (February 2008 — present); Executive Vice President, Chief Financial Officer and Chief Compliance Officer, William R. Hough & Co. (securities dealer) (1979 — 2004); and Treasurer, The Hough Group of Funds (1993 — 2004). | 176 | N/A |
* | Each Board Member shall hold office until: 1) his or her successor is elected and qualified or 2) he or she resigns, retires or his or her term as a Board Member is terminated in accordance with the Trust’s Declaration of Trust. | |
** | May be deemed an “interested person” (as that term is defined in the 1940 Act) of the Trust because of his employment with TAM or an affiliate of TAM. | |
*** | Independent Board Member means a Board Member who is not an “interested person” (as defined under the 1940 Act) of the Trust. |
123
OFFICERS
The mailing address of each officer is c/o Secretary of the Funds, 570 Carillon Parkway, St. Petersburg, Florida 33716. The following table shows information about the officers, including their ages, their positions held with the Trust and their principal occupations during the past five years (their titles may have varied during that period). Each officer will hold office until his or her successor has been duly elected or appointed or until his or her earlier death, resignation or removal.
Term of Office and | ||||||
Length of Time | Principal Occupation(s) or | |||||
Name and Age | Position | Served* | Employment During Past 5 Years | |||
John K. Carter (DOB: 4/24/61) | Chairman, Board Member, President, and Chief Executive Officer | 2006 — present | See the table above. | |||
Dennis P. Gallagher (DOB: 12/19/70) | Vice President, General Counsel and Secretary | 2006 — present | Vice President, General Counsel and Secretary, TII, Transamerica Funds, TST and TIS (2006 — present); Vice President, General Counsel and Secretary, TPP, TPFG, TPFG II and TAAVF (2007 — present); Director, Senior Vice President, General Counsel and Secretary, TAM and TFS (2006 — present); Assistant Vice President, TCI (2007 — present); and Director, Deutsche Asset Management (1998 — 2006). | |||
Joseph P. Carusone (DOB: 9/8/65) | Vice President, Treasurer and Principal Financial Officer | 2007 — present | Vice President, Treasurer and Principal Financial Officer, Transamerica Funds, TST, TIS and TII (2007 — present); Vice President (2007 — present), Treasurer and Principal Financial Officer (2001 — present), TPP, TPFG, TPFG II and TAAVF; Senior Vice President, TAM and TFS (2007 — present); Senior Vice President (January 2008 — present), Vice President (2001 — January 2008); Diversified Investment Advisors, Inc. (“DIA”); Director and President, Diversified Investors Securities Corp. (“DISC”) (2007 — present); Director, Transamerica Financial Life Insurance Company (“TFLIC”) (2004 — present); and Treasurer, Diversified Actuarial Services, Inc. (December 2002 — present). | |||
Christopher A. Staples (DOB: 8/14/70) | Vice President and Chief Investment Officer | 2005 — present | Vice President and Chief Investment Officer (2007 — present); Vice President — Investment Administration (2005 — 2007), TII; Vice President and Chief Investment Officer (2007 — present), Senior Vice President — Investment Management (2006 — 2007), Vice President — Investment Management (2005 — 2006), Transamerica Funds, TST and TIS; Vice President and Chief Investment Officer, TPP, TPFG, TPFG II and TAAVF (2007 - present); Director (2005 — present), Senior Vice President — Investment Management (2006 — present) and Chief Investment Officer (2007 — present), TAM; Director, TFS (2005 — present); and Assistant Vice President, Raymond James & Associates (1999 — 2004). |
124
Term of Office and | ||||||
Length of Time | Principal Occupation(s) or | |||||
Name and Age | Position | Served* | Employment During Past 5 Years | |||
Rick B. Resnik (DOB: 1/24/67) | Vice President, Chief Compliance Officer and Conflicts of Interest Officer | 2008 — present | Chief Compliance Officer, TPP, TPFG, TPFG II and TAAVF (1998 — present); Chief Compliance Officer, Transamerica Funds, TST, TIS and TII (January 2008 — present); Vice President and Conflicts of Interest Officer, TPP, TPFG, TPFG II, TAAVF, Transamerica Funds, TST, TIS and TII (June 2008 — present); Senior Vice President and Chief Compliance Officer, TAM (January 2008 — present); Senior Vice President, TFS (January 2008 — present); Director (2000 — present), Vice President and Chief Compliance Officer (1997 — present), DISC; and Assistant Vice President, TFLIC (1999 — present). | |||
Michael A. Masson (DOB: 1/21/71) | Assistant Treasurer | 2005 — present | Assistant Treasurer (2007 — present), Assistant Vice President (2005 — 2007), Transamerica Funds, TST, TIS and TII; Assistant Treasurer, TPP, TPFG, TPFG II and TAAVF (2007 — present); Director of Financial Reporting (2007 — present); Assistant Vice President (2005 — 2007), TAM and TFS; and Assistant Vice President, JPMorgan Chase & Co. (1999 — 2005). | |||
Suzanne Valerio-Montemurro (DOB: 8/13/64) | Assistant Treasurer | 2007 — present | Assistant Treasurer, Transamerica Funds, TST, TIS, TII, TPP, TPFG, TPFG II and TAAVF (2007 — present); and Vice President, DIA (1998 — present). | |||
Richard E. Shield, Jr. (DOB: 1/3/74) | Tax Officer | 2008 — present | Tax Officer, Transamerica Funds, TST, TIS, TII, TPP, TPFG, TPFG II and TAAVF (June 2008 — present); Tax Manager, Jeffrey P. McClanathan, CPA (2006 — 2007) and Gregory, Sharer & Stuart (2005 — 2006); Tax Senior, Kirkland, Russ, Murphy & Tapp, P.A. (2003 — 2005); and Certified Public Accountant, Schultz, Chaipel & Co., LLP (1998 — 2003). |
* | Elected and serves at the pleasure of the Board of the Trust. |
If an officer has held offices for different Funds for different periods of time, the earliest applicable date is shown. No officer of the Trust, except for the Chief Compliance Officer, receives any compensation from the Trust.
Additional information about the Funds’ Board Members can be found in the Statement of Additional Information, available, without charge, upon request, by calling toll free 1-888-233-4339 or on the Funds’ website at www.transamericafunds.com.
125
PROXY VOTING POLICIES AND PROCEDURES AND QUARTERLY PORTFOLIO HOLDINGS
A description of the Transamerica Funds’ proxy voting policies and procedures is available in the Statement of Additional Information of the Funds, available without charge upon request by calling 1-888-233-4339 (toll free) or on the Securities and Exchange Commission website at http://www.sec.gov.
In addition, the Funds are required to file Form N-PX, with their complete proxy voting records for the 12 months ended June 30th, no later than August 31st of each year. The Form is available without charge: (1) from the Funds, upon request by calling 1-888-233-4339; and (2) on the SEC’s website at http://www.sec.gov.
The Funds file their complete schedule of portfolios holdings with the SEC for the first and third quarter of each fiscal year on Form N-Q, which is available on the Commission’s website at http://www.sec.gov. The Funds’ Form N-Q may be reviewed and copied at the Commission’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.
You may also visit the Trust’s website at www.transamericafunds.com for this and other information about the Funds and the Trust.
Important Notice Regarding Delivery of Shareholder Documents
Every year we send shareholders informative materials such as the Transamerica Funds Annual Report, the Transamerica Funds Prospectus, and other required documents that keep you informed regarding your funds. Transamerica Funds will only send one piece per mailing address, a method that saves your Funds money by reducing mailing and printing costs. We will continue to do this unless you tell us not to. To elect to receive individual mailings, simply call a Transamerica Customer Service Representative toll free at 1-888-233-4339, 8 a.m. to 7 p.m. Eastern Time, Monday–Friday. Your request will take effect within 30 days.
126
P.O. Box 9012
Clearwater, FL 33758-9012
Clearwater, FL 33758-9012
![(TRANSAMERICA LOGO)](https://capedge.com/proxy/N-14/0000950123-09-040205/g20257a2025716.gif)
Customer Service 1-888-233-4339
P.O. Box 9012 • Clearwater, FL 33758-9012
Distributor: Transamerica Capital, Inc.
P.O. Box 9012 • Clearwater, FL 33758-9012
Distributor: Transamerica Capital, Inc.