HSBC Funds N-CSR Certified annual shareholder report (management investment company)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number: 811-04782

HSBC FUNDS
(Exact name of registrant as specified in charter)

452 FIFTH AVENUE
NEW YORK, NY 10018
(Address of principal executive offices) (Zip code)

CITI FUND SERVICES
3435 STELZER ROAD
COLUMBUS, OH 43219
(Name and address of agent for service)

Registrant’s telephone number, including area code: 1-800-782-8183

Date of fiscal year end: October 31

Date of reporting period: October 31, 2013

Item 1. Reports to Stockholders.

HSBC Global Asset Management (USA) Inc.

HSBC Funds
Annual Report
October 31, 2013

MONEY MARKET FUNDS	Class A	Class B	Class C	Class D	Class E	Class I	Class Y
HSBC Prime Money Market Fund	REAXX	HSMXX	HMMXX	HIMXX	HMEXX	HSIXX	RMYXX
HSBC U.S. Government Money Market Fund	FTRXX	HUBXX	HUMXX	HGDXX	HGEXX	HGIXX	RGYXX
HSBC U.S. Treasury Money Market Fund	HWAXX	HTBXX	HUCXX	HTDXX	HTEXX	HBIXX	HTYXX

Table of Contents

HSBC Family of Funds
Annual Report - October 31, 2013

Glossary of Terms
President’s Message	4
Commentary From the Investment Manager	5
Portfolio Reviews	6
Portfolio Composition	9
Schedules of Portfolio Investments
HSBC Prime Money Market Fund	10
HSBC U.S. Government Money Market Fund	13
HSBC U.S. Treasury Money Market Fund	15
Statements of Assets and Liabilities	16
Statements of Operations	17
Statements of Changes in Net Assets	18
Financial Highlights	22
Notes to Financial Statements	28
Report of Independent Registered Public Accounting Firm	37
Other Federal Income Tax Information	38
Table of Shareholder Expenses	39
Board of Trustees and Officers	41
Other Information	43

Glossary of Terms

Barclays U.S. Aggregate Bond Index is an unmanaged index generally representative of investment-grade, USD-denominated, fixed-rate debt issues, taxable bond market, including Treasuries, government-related and corporate securities, asset-backed, mortgage-backed and commercial mortgage-backed securities, with maturities of at least one year.

Barclays U.S. Corporate High-Yield Bond Index is an unmanaged index that measures the non-investment grade, USD-denominated, fixed-rate, taxable corporate bond market. Securities are classified as high-yield if the middle rating of Moody’s, Fitch, and S&P is Ba1/BB+/BB+ or below. The index excludes emerging markets debt.

Gross Domestic Product (“GDP”) measures the market value of the goods and services produced by labor and property in the United States.

Lipper Money Market Funds Average is an equally weighted average of mutual funds that invest in high-quality financial instruments rated in the top two grades with dollar-weighted average maturities of less than 90 days. These funds intend to keep a constant net asset value.

Lipper U.S. Government Money Market Funds Average is an equally weighted average of mutual funds that invest principally in financial instruments issued or guaranteed by the U.S. government, its agencies, or its instrumentalities, with dollar-weighted average maturities of less than 90 days. These funds intend to keep a constant net asset value.

Lipper U.S. Treasury Money Market Funds Average is an equally weighted average of mutual funds that invest principally in U.S. Treasury obligations with dollar-weighted average maturities of less than 90 days. These funds intend to keep a constant net asset value.

Morgan Stanley Capital International Europe Australasia and Far East (“MSCI EAFE”) Index is an unmanaged equity index which captures large and mid cap representation across Developed Markets countries: Australia, Austria, Belgium, Denmark, Finland, France, Germany, Greece, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland and the UK (excluding the US and Canada). With 910 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.

Morgan Stanley Capital International Emerging Market (“MSCI EM”) Index is an unmanaged index that captures large and mid cap representation across 21 Emerging Markets (EM) countries: Brazil, Chile, China, Colombia, Czech Republic, Egypt, Hungary, India, Indonesia, Korea, Malaysia, Mexico, Morocco, Peru, Philippines, Poland, Russia, South Africa, Taiwan, Thailand and Turkey. With 818 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.

Russell 2000^® Index is an unmanaged index that measures the performance of the small-cap segment of the U.S. equity universe. The Russell 2000^® Index is a subset of the Russell 3000^® Index representing approximately 10% of the total market capitalization of that index. It includes approximately 2000 of the smallest securities based on a combination of their market cap and current index membership.

Standard & Poor’s 500 (“S&P 500”) Index is an unmanaged index that is widely regarded as a gauge of the U.S. equities market. This index includes 500 leading companies in leading industries of the U.S. economy. The S&P 500 Index focuses on the large-cap segment of the market, with approximately 75% coverage of U.S. equities.

Lipper is an independent mutual fund performance monitor whose results are based on total return and do not reflect a sales charge.

Securities indices assume reinvestment of all distributions and interest payments and do not take in account brokerage fees or expenses. Securities in the Funds do not match those in the indices and performance of the Funds will differ. Investors cannot invest directly in an index.

President’s Message

Dear Shareholder,

We are pleased to send to you the HSBC Funds annual report, covering the fiscal year ended October 31, 2013. This report contains detailed information about your Funds’ portfolio of investments and operating results. We encourage you to review it carefully.

This report includes commentary from the Funds’ portfolio managers in which they discuss the investment markets and their respective Fund’s performance. The portfolio manager commentary is accompanied by the Fund’s return for the period, listed alongside the returns of its benchmark index and peer group average for comparative purposes.

In closing, we would like to thank you for investing in the HSBC Funds. We continue to focus the HSBC Fund Family on investment solutions to assist our shareholders in reaching their financial goals. We appreciate the trust you place in us, and will continue working to earn it. Please contact us at any time with questions or concerns.

Sincerely,

Richard A. Fabietti
President

4       HSBC FAMILY OF FUNDS

Commentary From the Investment Manager

HSBC Global Asset Management (USA) Inc.

U.S. Economic Review

Economic growth picked up pace in developing economies throughout the world during the 12-month period between November 1, 2012 and October 31, 2013. Many major economies, including the United States, reported improved economic data during the period, indicating new momentum for a modest but sustained recovery. The U.S. equity markets made strong gains during the period, boosted by improvements in the labor and housing markets and healthy corporate profits. Markets continued to benefit from the Federal Reserve Board’s (the “Fed”) decision to maintain the federal funds rate—a key factor in lending rates—at a historically low target range between 0.00% and 0.25%. Economic headwinds remained, however, including relatively high unemployment in some areas, low consumer spending and reduced government spending caused by sequestration.

Investor confidence declined mid-year due in part to expectations that the Fed would begin tapering its bond purchasing program. Concerns about the impact of tapering diminished, however, when the Fed announced in September that it would delay winding down its stimulus efforts until the unemployment rate fell significantly lower. The first shutdown of the U.S. government in 17 years occurred in October. This political crisis, along with the related standoff over raising the country’s borrowing limit, was another factor weighing on investor sentiment. The uncertainty surrounding the crisis dragged on equities, although markets regained momentum once a political deal was struck that reopened the government and raised the debt ceiling. Broad U.S. stock market indices ended the period significantly above where they were positioned 12 months earlier.

Improving political circumstances in the eurozone and positive economic data helped boost stocks in developed economies across the world. The economies of both Japan and Europe transitioned out of recession. Progress was made toward alleviating the sovereign debt crisis in Europe. The European Central Bank’s aggressive efforts, including its government bond-buying program known as Outright Monetary Transactions, reassured investors. Still, many developments in Europe revealed ongoing economic weaknesses, including a controversial bailout in Cyprus, political uncertainty in Italy and high unemployment throughout the eurozone.

Economic growth in many emerging markets slowed during the period, as concerns grew about rising inflation and potential decreases in global liquidity. In addition, signs of softening in China’s economy led to a fall in commodity prices, which dragged on stocks throughout emerging markets. Central banks in both India and Brazil fought rising inflation by raising interest rates.

The recovery of the U.S. housing market remained robust. New home sales and housing starts increased, though the pace of growth slowed late in the period. Although the unemployment rate gradually edged downward, it remained well above pre-recession levels. Moreover, the number of long-term unemployed individuals, including those who dropped out of the labor market entirely, remained high. Real income grew at a modest pace, but consumer spending remained weak, consumer confidence dropped sharply and personal savings rates slowed. Economic activity in the manufacturing sector expanded during the period, though the rate of growth slowed.

U.S. Gross Domestic Product¹ growth increased each quarter during the period, expanding at a rate of 0.1% during the fourth quarter of 2012 and quickening to a rate of 2.8% in the third quarter of 2013, according to preliminary estimates.

Market Review

The period began with U.S. markets retreating slightly due to the political face-off over the “fiscal cliff” and concerns about ongoing turmoil related to eurozone sovereign debt.

Equities then regained momentum in the first quarter of 2013 and began a steady rally that persisted through the duration of the period with only a few brief interruptions. The strong performance of equities was undeterred by uncertainty about government policy and concerns that the onset of automatic budget cuts—known as sequestration—would undermine economic growth. A political compromise that avoided the direst consequences of the fiscal cliff, along with improvement in the housing market, helped buoy investor confidence and fuel gains in the equity markets.

During the middle of the period equity prices fell as investors anticipated an imminent decrease in central bank liquidity. Stocks rebounded after the Fed delayed tapering its bond-purchasing program, with the S&P 500 Index¹ hitting a then-record high following the announcement. Equities ended the period in a rally that was spurred by the political deal that partially resolved the government shutdown and a second standoff over the debt ceiling.

Small- and mid-cap stocks outperformed large-cap stocks during the period, and emerging markets generally underperformed developed economies. The Russell 2000^® Index¹ of small-company stocks returned 36.28% and the MSCI Emerging Market Index¹ of emerging market stocks returned 6.90%.

Stocks in developed economies rose. Japanese equities performed well due to optimism regarding its central bank’s ambitious monetary easing schedule, which aimed to double the size of the monetary base over the next two years. International stocks made strong gains, slightly outperforming U.S. markets. The S&P 500 Index of large-company U.S. stocks returned 27.18% for the 12 months through October 2013. That compared to a 27.40% return for the MSCI EAFE Index¹ of international stocks in developed markets.

Rising interest rates, widening credit spreads and uncertainty about government policy resulted in weak performance in the U.S. fixed-income market during the period. Yields on U.S. Treasury bonds increased during the period, sending prices lower. Investment-grade corporate bonds also declined. Investors sought the more attractive yields offered by high-yield corporate bonds and high-yield municipal bonds, which were among the best-performing fixed-income sectors during the period. The Barclays U.S. Aggregate Bond Index¹, which tracks the broad investment-grade fixed-income market, returned -1.08% for the 12 months through October, while the Barclays U.S. Corporate High-Yield Bond Index¹ returned 8.87%. Fixed-income markets in Europe generated modest returns, while fixed-income in emerging markets ended the period significantly lower, despite a modest rebound in the final months of the period.

1       For additional information, please refer to the Glossary of Terms.

HSBC FAMILY OF FUNDS       5

Portfolio Reviews (Unaudited)
HSBC Prime Money Market Fund (Class A Shares, Class B Shares, Class C Shares, Class D Shares, Class I Shares and Class Y Shares) by John Chiodi Senior Portfolio Manager	Moody’s and Standard & Poor’s have assigned an “Aaa-mf” and “AAAm” rating to the HSBC Prime Money Market Fund.1

Investment Concerns

An investment in the Fund is not insured or guaranteed by the FDIC or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.

For a complete description of these and other risks associated with investment in a mutual fund, please refer to the Fund’s prospectus.

Portfolio Performance

Prime money market yields fell and remained at low levels during the 12-month period ended October 31, 2013.

Several factors contributed to the low-yield environment. Early in the period, the Federal Reserve Board ended Operation Twist, a stimulus program through which it sold short-dated Treasuries and bought long-dated Treasuries in order to lower long-term bond yields and boost economic growth. The supply of available collateral for repurchase agreements (“repos”) on dealers’ balance sheets fell significantly when that program ended. That development led to lower yields on short-term repos.

In addition, new regulations incentivized broker/dealers to issue more long-term securities and fewer short-term securities. This development reduced the supply of short-term issues, which prime money market funds are mandated to favor in their portfolios, and caused yields on those securities to fall.

Yields also remained low due to continued concerns about the relatively weak economic recovery. In that environment, investors believed that the Federal Reserve will keep short-term interest rates at their current low levels well into 2014, and perhaps longer, in order to help stimulate the economy.

Given the projections of continued low interest rates, we looked to capture the additional yield available on longer-term securities by maintaining a relatively long weighted average maturity during the period. We also continued to favor high-quality issues with, in our opinion, superior credit fundamentals in order to provide strong market liquidity.^†

†       Portfolio composition is subject to change.

			Average Annual						Expense
Fund Performance			Total Return (%)					Yield (%)2	Ratio (%)3
	Inception	1	5	10	Since			7-Day
As of October 31, 2013	Date	Year	Year	Year	Inception			Average	Gross	Net
Class A	11/13/98	0.01	0.07	1.47		2.08		0.01	0.69	0.69
Class B4	4/4/01	-3.99	0.04	1.17		1.16		0.01	1.29	1.29
Class C5	3/23/01	-0.99	0.05	1.18		1.15		0.00	1.29	1.29
Class D	4/1/99	0.01	0.09	1.55		2.12		0.01	0.54	0.54
Class I	1/9/02	0.08	0.23	1.81		1.77		0.03	0.19	0.19
Class Y	11/12/98	0.01	0.14	1.70		2.37		0.01	0.29	0.29
Lipper Money Market
Funds Average6	—	0.01	0.09	1.42		2.04	7	N/A	N/A	N/A

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower.

Certain returns shown include monies received by the Fund in respect of a one-time payment in respect of a class action settlement and a one-time reimbursement from HSBC Global Asset Management (USA) Inc. related to past marketing arrangements. As a result, the Fund’s total returns for those periods were higher than they would have been had the Fund not received the payments.

1	The “Aaa-mf” and “AAAm” money market fund rating is historical and reflects Moody’s and Standard & Poor’s opinion as to the quality of the Fund’s investments, liquidity management, and operations and trading support. Periodic reviews are conducted to ensure a secure operations environment. Moody’s and Standard & Poor’s ratings represent an opinion only, not a recommendation to buy or sell. Obligations rated A-1+, A-1 or P-1 are rated in the highest short-term rating category by Standard & Poor’s (A-1+ or A-1) or Moody’s Investor Service (P-1). The obligor’s capacity to meet its financial commitments on these obligations is regarded to be “extremely strong” (A-1+), “strong” (A-1) or “superior” (P-1).
2	The seven-day yield quotation more closely reflects the current earnings of the money market fund than the total return quotation. The seven-day yield reflects voluntary fee waivers/expense reimbursements. Without the voluntary fee waivers/expense reimbursements, the yields would have been -0.51%, -1.11%, -1.11%, -0.36%, -0.01% and -0.11% for Class A Shares, Class B Shares, Class C Shares, Class D Shares, Class I Shares and Class Y Shares, respectively.
3	Reflects the expense ratio as reported in the prospectus dated February 28, 2013.
4	Reflects the applicable contingent deferred sales charge, maximum of 4.00%. Class B Shares were operational during a portion of the periods presented. Amounts reflect performance for the period of time the Class had operations, which was 211 and 147 days for the years ended October 31, 2001 and 2002, respectively. The Class was operational during the entire fiscal years from October 31, 2003 through 2013.
5	Reflects the applicable contingent deferred sales charge, maximum of 1.00%. Class C Shares were operational during a portion of the periods presented. Amounts reflect performance for the period of time the Class had operations, which was 201 days for the year ended October 31, 2001. The Class was operational during the entire fiscal years from October 31, 2002 through 2013.
6	For additional information, please refer to the Glossary of Terms.
7	Return for the period October 31, 1998 to October 31, 2013.

6       HSBC FAMILY OF FUNDS

Portfolio Reviews (Unaudited)
HSBC U.S. Government Money Market Fund (Class A Shares, Class B Shares, Class C Shares, Class D Shares, Class I Shares and Class Y Shares) by John Chiodi Senior Portfolio Manager	Moody’s and Standard & Poor’s have assigned an “Aaa-mf” and “AAAm” rating to the HSBC U.S. Government Money Market Fund.1

Investment Concerns

An investment in the Fund is not insured or guaranteed by the FDIC or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.

For a complete description of these and other risks associated with investment in a mutual fund, please refer to the Fund’s prospectus.

Portfolio Performance

U.S. government money market securities offered historically low yields during much of the 12-month period through October 31, 2013, despite a temporary spike in yields during the debt ceiling crisis.

Concerns about the weakness of the economic recovery prompted the Federal Reserve Board to maintain its low interest rate policy throughout the period in an effort to stimulate economic growth. The federal funds rate (a key short-term interest rate) remained within a range of 0.00% to 0.25% throughout the period.

During the period, the Federal Reserve Board ended Operation Twist, a program it had implemented to lower long-term bond yields and to help stimulate economic growth by simultaneously selling short-dated Treasuries and buying long-dated Treasuries. The supply of available collateral for repurchase agreements (“repos”) on dealers’ balance sheets fell significantly when that program ended, a development that lead to lower yields on short-term repos.

In addition, issuance of eligible money market securities by government agencies was limited during the period, as those agencies preferred to issue longer-term securities. The result of that low supply was further downward pressure on yields.

That said, toward the end of the period, the debt ceiling debate and government shutdown had a significant impact on money market securities. Yields on short-term government agency issues rose temporarily as investors worried about the potential for the government to default on its debt payments if Congress did not raise the debt ceiling.

The Fund maintained a relatively long weighted average maturity based on our outlook that interest rates would remain low for the near future. That approach enabled the Fund to capture the additional yield available from longer-term issues. We favored LIBOR-based floating rate notes for their relatively attractive yields. We also took advantage of temporary rate increases during the debt ceiling debate by investing in securities with relatively high yields.^†

^† Portfolio composition is subject to change.

 

			Average Annual						Expense
Fund Performance			Total Return (%)					Yield (%)2	Ratio (%)3
	Inception	1	5	10		Since		7-Day
As of October 31, 2013	Date	Year	Year	Year	Inception			Average	Gross	Net
Class A	5/3/90	0.01	0.04	1.37		2.94		0.01	0.69	0.69
Class B4	9/11/98	-3.99	0.03	1.27		1.76		0.01	1.29	1.29
Class C5	11/20/06	—	—	—		1.39		—	1.29	1.29
Class D	4/1/99	0.01	0.05	1.45		1.97		0.01	0.54	0.54
Class I6	12/24/03	0.01	0.11	—		1.38		0.01	0.19	0.19
Class Y	7/1/96	0.01	0.08	1.59		2.61		0.01	0.29	0.29
Lipper U.S. Government
Money Market Funds Average7	—	0.01	0.05	1.36		2.96	8	N/A	N/A	N/A

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower.

Certain returns shown include monies received by the Fund in respect of a one-time payment in respect of a class action settlement and a one-time reimbursement from HSBC Global Asset Management (USA) Inc. related to past marketing arrangements. As a result, the Fund’s total returns for those periods were higher than they would have been had the Fund not received the payments.

1	The “Aaa-mf ” and “AAAm” money market fund rating is historical and reflects Moody’s and Standard & Poor’s opinion as to the quality of the Fund’s investments, liquidity management, and operations and trading support. Periodic reviews are conducted to ensure a secure operations environment. Moody’s and Standard & Poor’s ratings represent an opinion only, not a recommendation to buy or sell. Obligations rated A-1+, A-1 or P-1 are rated in the highest short-term rating category by Standard & Poor’s (A-1+ or A-1) or Moody’s Investor Service (P-1). The obligor’s capacity to meet its financial commitments on these obligations is regarded to be “extremely strong” (A-1+), “strong” (A-1) or “superior” (P-1).
2	The seven-day yield quotation more closely reflects the current earnings of the money market fund than the total return quotation. The seven-day yield reflects voluntary fee waivers/expense reimbursements. Without the voluntary fee waivers/expense reimbursements, the yields would have been -0.48%, -1.08%, -0.33%, 0.02% and -0.08% for Class A Shares, Class B Shares, Class D Shares, Class I Shares and Class Y Shares, respectively.
3	Reflects the expense ratio as reported in the prospectus dated February 28, 2013.
4	Reflects the applicable contingent deferred sales charge, maximum of 4.00%.
5	Reflects the applicable contingent deferred sales charge, maximum of 1.00%. Class C Shares were operational during a portion of the periods presented. Amounts reflect performance for the period of time the Class had operations, which was 346, 362 and 351 days during the years end October 31, 2006, 2009 and 2010, respectively. The Class was not operational during the entire fiscal years ended October 31, 2007, 2008, 2011, 2012 and 2013, respectively.
6	Class I Shares were operational during a portion of the periods presented. Amounts reflect performance for the period of time the Class had operations, which was 10, 89, 136 and 357 days during the years ended October 31, 2004, 2005, 2006 and 2007, respectively. The Class was operational during the entire years ended October 31, 2008 through 2013.
7	For additional information, please refer to the Glossary of Terms.
8	Return for the period April 30, 1990 to October 31, 2013.

HSBC FAMILY OF FUNDS        7

Portfolio Reviews (Unaudited)
HSBC U.S. Treasury Money Market Fund (Class A Shares, Class B Shares, Class C Shares, Class D Shares, Class I Shares and Class Y Shares) by John Chiodi Senior Portfolio Manager	Moody’s and Standard & Poor’s have assigned an “Aaa-mf” and “AAAm” rating to the HSBC U.S. Government Money Market Fund.1

Investment Concerns

An investment in the Fund is not insured or guaranteed by the FDIC or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the fund. The Fund’s income may be subject to the federal alternative minimum tax and to certain state and local taxes.

For a complete description of these and other risks associated with investment in a mutual fund, please refer to the Fund’s prospectus.

Portfolio Performance

Treasury bill yields generally remained low during the 12-month period ended October 31, 2013, apart from a temporary spike in yields during the October debt ceiling standoff that caused investors to worry about the possibility of the government defaulting on its debts.

Federal Reserve Board policy had a major impact on Treasury bill yields. The Fed kept the federal funds rate (a key short-term interest rate that influences T-bill yields) between 0.00% and 0.25% during the period in order to help stimulate the economy. Investors remained confident during the period that the Fed would not raise rates in the near future given the continued relative weakness of the economic recovery.

Additionally, supply-and-demand factors also impacted money market yields. Demand for Treasuries rose near the end of each calendar quarter-end, as institutional investors shifted assets into short-term, liquid securities to improve the quality of their balance sheets. That increase in demand near the end of each quarter pushed up Treasury prices, causing Treasury yields (which move in the opposite direction of prices) to fall. The Fed later increased the supply of Treasury bills by issuing cash management bills, and Treasury yields rose due to that increase in supply.

We positioned the Fund with a relatively long weighted average maturity early in the period, which enabled the Fund to lock in the relatively high yields offered by longer-term securities. We strategically positioned the Fund with a relatively short weighted average maturity in anticipation of the Treasury’s issuance of T-bills in February. The Fund shortened its weighted average maturity during the debt ceiling debate in October to ensure adequate liquidity was available and avoided securities maturing in October as much as possible.^†

The Fund maintained its barbell strategy, in which the Fund’s holdings are concentrated among very short-term securities (such as Treasury bills with maturities of around one month) and longer-term issues (including Treasury coupons maturing in about one year). This approach enabled the Fund to take advantage when short-term rates rose and to ensure adequate liquidity, while still capturing the additional yield on longer-term money market securities.^†

^† Portfolio composition is subject to change.

			Average Annual						Expense
Fund Performance			Total Return (%)					Yield (%)2	Ratio (%)3
	Inception	1	5	10	Since			7-Day
As of October 31, 2013	Date	Year	Year	Year	Inception			Average	Gross	Net
Class A	5/24/01	0.00	0.02	1.16		1.13		0.00	0.69	0.69
Class B4	8/12/04	-4.00	0.02	—		1.00		0.00	1.29	1.29
Class C5	12/24/03	—	—	—		0.04		—	1.29	1.29
Class D	5/14/01	0.00	0.02	1.23		1.22		0.00	0.54	0.54
Class I6	12/30/03	0.00	0.03	—		1.33		0.00	0.19	0.19
Class Y	5/11/01	0.00	0.02	1.36		1.38		0.00	0.29	0.29
Lipper U.S. Treasury
Money Market Funds Average7	—	0.01	0.02	1.22		1.25	8	N/A	N/A	N/A

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower.

Certain returns shown include monies received by the Fund in respect of a one-time payment in respect of a class action settlement and a one-time reimbursement from HSBC Global Asset Management (USA) Inc. related to past marketing arrangements. As a result, the Fund’s total returns for those periods were higher than they would have been had the Fund not received the payments.

1	The “Aaa-mf ” and “AAAm” money market fund rating is historical and reflects Moody’s and Standard & Poor’s opinion as to the quality of the Fund’s investments, liquidity management, and operations and trading support. Periodic reviews are conducted to ensure a secure operations environment. Moody’s and Standard & Poor’s ratings represent an opinion only, not a recommendation to buy or sell. Obligations rated A-1+, A-1 or P-1 are rated in the highest short-term rating category by Standard & Poor’s (A-1+ or A-1) or Moody’s Investor Service (P-1). The obligor’s capacity to meet its financial commitments on these obligations is regarded to be “extremely strong” (A-1+), “strong” (A-1) or “superior” (P-1).
2	The seven-day yield quotation typically more closely reflects the current earnings of the money market fund than the total return quotation. The seven-day yield reflects voluntary fee waivers/expense reimbursements. Without the voluntary fee waivers/expense reimbursements, the yields would have been -0.49%, -0.34%, 0.01% and -0.09% for Class A Shares, Class D Shares, Class I Shares and Class Y Shares, respectively.
3	Reflects the expense ratio as reported in the prospectus dated February 28, 2013.
4	Reflects the applicable contingent deferred sales charge, maximum of 4.00%. Class B Shares were operational during a portion of the year ended October 31, 2013. Amounts reflect performance for the period of time the Class had operations, which was 249 days during the year ended October 31, 2013. The Class was operational since inception through the years ended October 31, 2012.
5	Reflects the applicable contingent deferred sales charge, maximum of 1.00%. Class C Shares were operational during a portion of the periods presented. Amounts reflect performance for the period of time the Class had operations, which was 26 and 351 days during the years ended October 31, 2008 and 2010, respectively. The Class was operational during the entire years ended October 31, 2005, 2006, 2007 and 2009. The Class was not operational during the entire years ended October 31, 2011, 2012 and 2013, respectively.
6	Class I Shares were operational during a portion of the periods presented. Amounts reflect performance for the period of time the Class had operations, which was 13 and 280 days during the years ended October 31, 2004 and 2005, respectively. The Class was operational during the entire years ended October 31, 2006, 2007, 2008, 2009, 2010, 2011, 2012 and 2013, respectively.
7	For additional information, please refer to the Glossary of Terms.
8	Return for the period April 30, 2001 to October 31, 2013.

8       HSBC FAMILY OF FUNDS

Portfolio Reviews

Portfolio Composition*

October 31, 2013

HSBC Prime Money Market Fund
Investment Allocation	Percentage of Investments at Value (%)
Certificates of Deposit		42.3
Commercial Paper and
Notes		29.0
U.S. Treasury Obligations		14.7
Time Deposits		5.3
Yankee Dollars		4.2
Corporate Obligations		3.9
U.S. Government and
Government Agency
Obligations		0.6
Total		100.0
HSBC U.S. Government Money Market Fund
Investment Allocation	Percentage of Investments at Value (%)
U.S. Treasury Obligations		57.3
Repurchase Agreements		26.0
U.S. Government and
Government Agency
Obligations		16.7
Total		100.0
HSBC U.S. Treasury Money Market Fund
Investment Allocation	Percentage of Investments at Value (%)
U.S. Treasury Obligations		100.0
Total		100.0

____________________
 

* Portfolio composition is subject to change.

HSBC FAMILY OF FUNDS        9

HSBC PRIME MONEY MARKET FUND

Schedule of Portfolio Investments—as of October 31, 2013

Certificates of Deposit – 39.5%
	Principal	Amortized
	Amount ($)	Cost ($)
Banking – 39.5%
Bank of Montreal Chicago,
0.17%, 12/12/13	100,000,000	100,000,000
Bank of Montreal Chicago,
0.17%, 12/20/13	75,000,000	74,999,996
Bank of Nova Scotia Houston,
0.18%, 12/5/13 (a)	45,000,000	45,000,000
Bank of Nova Scotia Houston,
0.24%, 3/18/14 (a)	50,000,000	50,000,000
Bank of Tokyo-Mitsubishi UFJ, N.Y.,
0.18%, 12/3/13	70,000,000	70,000,000
Bank of Tokyo-Mitsubishi UFJ, N.Y.,
0.24%, 12/11/13	35,000,000	35,000,000
Bank of Tokyo-Mitsubishi UFJ, N.Y.,
0.21%, 1/13/14	30,000,000	30,000,000
Bank of Tokyo-Mitsubishi UFJ, N.Y.,
0.42%, 2/12/14	50,000,000	50,000,000
Bank of Tokyo-Mitsubishi UFJ, N.Y.,
0.86%, 3/7/14 (a)	5,800,000	5,808,273
Credit Agricole CIB, N.Y.,
0.12%, 11/1/13	80,000,000	80,000,000
Credit Industriel et Commercial, N.Y.,
0.12%, 11/1/13	90,000,000	90,000,000
Credit Industriel et Commercial, N.Y.,
0.15%, 11/1/13	50,000,000	50,000,000
Credit Industriel et Commercial, N.Y.,
0.23%, 11/1/13	55,000,000	55,000,000
Credit Suisse, N.Y.,
0.46%, 12/6/13 (a)	50,000,000	50,000,000
Credit Suisse, N.Y.,
0.25%, 4/22/14	60,000,000	60,001,428
Deutsche Bank, N.Y.,
0.25%, 4/30/14 (a)	100,000,000	100,000,000
DnB NOR Bank ASA, N.Y.,
0.23%, 11/19/13	35,000,000	35,000,000
DnB NOR Bank ASA, N.Y.,
0.23%, 12/3/13	10,000,000	10,000,000
JPMorgan Chase Bank N.A.,
0.29%, 7/28/14 (a)	50,000,000	50,000,000
Mizuho Corporate Bank, N.Y.,
0.21%, 11/26/13	20,000,000	20,000,138
Mizuho Corporate Bank, N.Y.,
0.22%, 1/24/14	75,000,000	75,000,000
National Australia Bank Ltd.,
0.22%, 6/18/14 (a)	60,000,000	60,000,000
National Australia Bank, N.Y.,
1.44%, 1/30/14 (a)	14,075,000	14,117,610
Nordea Bank Finland, N.Y.,
0.25%, 1/3/14	90,000,000	90,000,000
Norinchukin Bank, N.Y.,
0.10%, 11/1/13	150,000,000	150,000,000
Norinchukin Bank, N.Y.,
0.22%, 12/4/13	90,000,000	90,002,377
Norinchukin Bank, N.Y.,
0.27%, 1/29/14 (a)	13,850,000	13,851,608
Royal Bank of Canada, N.Y.,
0.31%, 2/3/14 (a)	65,000,000	65,000,000
Royal Bank of Canada, N.Y.,
0.30%, 2/19/14 (a)	35,000,000	35,000,000
Shinhan Bank, N.Y.,
0.38%, 11/20/13	20,000,000	20,000,000
Skandinaviska Enskilda Bank, N.Y.,
0.17%, 11/6/13	55,000,000	55,000,000
Sumitomo Mitsui Banking Corp.,
N.Y., 0.16%, 11/1/13	10,000,000	10,000,000
Sumitomo Mitsui Banking Corp.,
N.Y., 0.21%, 1/29/14	85,000,000	85,000,000
Svenska Handelsbanken, N.Y.,
0.22%, 12/2/13	25,000,000	25,000,428
Svenska Handelsbanken, N.Y.,
0.22%, 3/24/14	30,000,000	30,000,590
Toronto Dominion Bank, N.Y.,
0.22%, 11/15/13 (a)	65,000,000	65,000,000
Toronto Dominion Bank, N.Y.,
0.22%, 6/17/14 (a)	13,000,000	13,000,000
Toronto Dominion Bank, N.Y.,
0.24%, 7/28/14 (a)	20,000,000	20,000,000
TOTAL CERTIFICATES
OF DEPOSIT
(COST $1,976,782,448)		1,976,782,448
Commercial Paper and Notes – 27.1%
Banking – 14.0%
ANZ New Zealand International Ltd.,
0.28%, 4/15/14 (a)(c)	25,000,000	25,000,000
Australia & New Zealand
Banking Group Ltd.,
0.31%, 5/12/14 (a)(c)	25,000,000	25,000,000
Bank of Tokyo-Mitsubishi UFJ, N.Y.,
0.12%, 11/1/13 (b)	50,000,000	50,000,000
Commonwealth Bank of Australia,
N.Y., 0.31%, 11/15/13 (a)(c)	30,000,000	30,001,666
Commonwealth Bank of Australia,
N.Y., 0.23%, 11/21/13 (b)(c)	65,000,000	64,991,875
Commonwealth Bank of Australia,
N.Y., 0.26%, 5/16/14 (a)(c)	10,000,000	10,000,000
Commonwealth Bank of Australia,
N.Y., 0.25%, 9/11/14 (a)(c)	40,000,000	40,000,000
Credit Agricole North America, Inc.,
0.14%, 11/1/13 (b)	21,000,000	21,000,000
DBS Bank Ltd.,
0.24%, 1/10/14 (b)(c)	24,000,000	23,988,800
DnB NOR Bank ASA, N.Y.,
0.20%, 12/23/13 (b)(c)	30,000,000	29,991,333
National Australia
Funding Delaware, Inc.,
0.22%, 2/20/14 (b)(c)	20,000,000	19,986,742
Nordea Bank AB,
0.18%, 11/18/13 (b)(c)	50,000,000	49,995,750
Societe Generale N.A.,
0.24%, 11/1/13 (b)	65,000,000	65,000,000
Societe Generale N.A.,
0.24%, 12/6/13 (b)	30,000,000	29,993,146
Sumitomo Mitsui Banking Corp.,
N.Y., 0.12%, 11/1/13 (b)(c)	12,160,000	12,160,000
Svenska Handelsbanken, Inc.,
0.25%, 2/4/14 (b)(c)	20,000,000	19,986,806

10       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC PRIME MONEY MARKET FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

Commercial Paper and Notes, continued
	Principal	Amortized
	Amount ($)	Cost ($)
Banking, continued
United Overseas Bank Ltd.,
0.19%, 11/25/13 (b)(c)	30,000,000	29,996,200
United Overseas Bank Ltd.,
0.22%, 3/10/14 (b)(c)	25,000,000	24,980,292
Westpac Banking Corp.,
0.31%, 1/8/14 (a)(c)	15,000,000	15,000,000
Westpac Securities NZ Ltd.,
0.34%, 11/29/13 (a)(c)	85,000,000	85,011,205
Westpac Securities NZ Ltd.,
0.29%, 4/11/14 (a)(c)	29,000,000	29,000,482
		701,084,297
Diversified – 3.6%
Caisse des Depots et
Consignations,
0.20%, 11/29/13 (c)	30,000,000	29,995,450
Caisse des Depots et
Consignations,
0.24%, 1/2/14 (c)	20,000,000	19,991,906
Caisse des Depots et
Consignations,
0.35%, 8/29/14 (b)(c)	30,000,000	29,912,208
Erste Abwicklungsanstalt,
0.20%, 2/5/14 (b)(c)	85,000,000	84,954,667
Erste Abwicklungsanstalt,
0.35%, 2/12/14 (b)(c)	15,000,000	14,984,979
		179,839,210
Finance – 9.5%
Antalis US Funding Corp.,
0.30%, 11/8/13 (b)(c)	17,440,000	17,438,983
ASB Finance Ltd., Series GB,
0.30%, 9/2/14 (a)(c)	25,000,000	25,000,000
Caisse Centrale Desjardins
du Quebec,
0.13%, 11/1/13 (b)(c)	15,000,000	15,000,000
Caisse Centrale Desjardins
du Quebec,
0.19%, 11/15/13 (b)(c)	30,000,000	29,997,842
Caisse Centrale Desjardins
du Quebec,
0.24%, 2/19/14 (b)(c)	20,000,000	19,985,333
Collateralized CP Co. LLC,
0.16%, 1/6/14 (b)	25,000,000	24,992,667
Collateralized CP II Co. LLC,
0.17%, 12/19/13 (b)(c)	60,000,000	59,986,400
MetLife Short Term Funding LLC,
0.16%, 12/10/13 (b)(c)	22,000,000	21,996,187
Natixis US Finance Co. LLC,
0.14%, 11/1/13 (b)	95,000,000	95,000,000
Rabobank USA Financial Corp.,
0.21%, 4/2/14 (b)	70,000,000	69,937,934
Toyota Motor Credit Corp.,
0.27%, 11/8/13 (b)	50,000,000	49,997,375
Toyota Motor Credit Corp.,
0.24%, 2/4/14 (b)	23,000,000	22,985,433
Toyota Motor Credit Corp.,
0.28%, 5/9/14 (b)	20,000,000	19,970,600
		472,288,754
TOTAL COMMERCIAL
PAPER AND NOTES
(COST $1,353,212,261)		1,353,212,261
Corporate Obligations – 3.6%
Banking – 2.9%
JPMorgan Chase Bank N.A.,
Series BKNT, 0.35%, 4/17/14,
Callable 12/9/13 @ 100 (a)	25,000,000	25,000,000
JPMorgan Chase Bank N.A.,
Series 1, 0.37%, 10/21/14, Callable
12/20/13 @ 100 (a)	20,000,000	20,000,000
Wells Fargo Bank N.A,
0.30%, 10/15/14, MTN (a)	60,000,000	60,000,000
Wells Fargo Bank N.A.,
0.31%, 10/7/14 (a)	40,000,000	40,000,000
		145,000,000
Finance – 0.6%
General Electric Capital Corp.,
5.90%, 5/13/14	8,580,000	8,835,715
General Electric Capital
Corp., Series A,
5.50%, 6/4/14, MTN	19,848,000	20,455,099
		29,290,814
Household Products – 0.1%
The Procter & Gamble Co.,
0.70%, 8/15/14	7,250,000	7,274,329
TOTAL CORPORATE
OBLIGATIONS
(COST $181,565,143)		181,565,143
Yankee Dollars – 3.9%
Banking – 3.4%
Barclays Bank plc,
2.38%, 1/13/14	12,100,000	12,149,598
National Australia Bank Ltd.,
0.97%, 11/8/13 (a)(c)	15,800,000	15,802,538
Royal Bank of Canada,
0.48%, 12/20/13, MTN (a)	50,000,000	50,022,616
Toronto Dominion Bank,
0.72%, 11/1/13, MTN (a)	42,870,000	42,870,000
Westpac Banking Corp.,
0.98%, 3/31/14 (a)(c)	15,750,000	15,795,802
Westpac Banking Corp.,
0.40%, 10/1/14, MTN,
Callable 12/31/13 @ 100 (d)	35,000,000	35,000,000
		171,640,554

See notes to financial statements. HSBC FAMILY OF FUNDS        11

HSBC PRIME MONEY MARKET FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

Commercial Paper and Notes, continued
	Principal	Amortized
	Amount ($)	Cost ($)
Commercial Banks – 0.5%
Commonwealth Bank of Australia,
0.98%, 3/17/14 (a)(c)	12,500,000	12,534,265
Commonwealth Bank of Australia,
2.13%, 3/17/14 (c)	10,000,000	10,068,205
		22,602,470
TOTAL YANKEE DOLLARS
(COST $194,243,024)		194,243,024
U.S. Government and Government Agency Obligations – 0.6%
Federal Farm Credit Bank – 0.6%
0.19%, 12/20/13(a), Series 2	30,000,000	30,000,000
TOTAL U.S. GOVERNMENT
AND GOVERNMENT
AGENCY OBLIGATIONS
(COST $30,000,000)		30,000,000
U.S. Treasury Obligations – 13.8%
U.S. Treasury Bills – 7.0%
0.24%, 11/7/13(b)	150,000,000	149,994,033
0.15%, 11/14/13(b)	100,000,000	99,994,746
0.16%, 11/29/13(b)	100,000,000	99,987,556
		349,976,335
U.S. Treasury Notes – 6.8%
4.25%, 11/15/13	50,000,000	50,076,662
1.50%, 12/31/13	35,000,000	35,073,959
1.88%, 2/28/14	50,000,000	50,275,907
1.75%, 3/31/14	50,000,000	50,321,428
2.25%, 5/31/14	50,000,000	50,606,053
2.38%, 8/31/14	50,000,000	50,914,764
2.38%, 9/30/14	50,000,000	50,994,186
		338,262,959
TOTAL U.S. TREASURY
OBLIGATIONS
(COST $688,239,294)		688,239,294
Time Deposits – 5.0%
Abbey National Treasury
Services plc, 0.10%, 11/1/13	100,000,000	100,000,000
ABN AMRO Bank NV,
0.12%, 11/1/13	150,000,000	150,000,000
TOTAL TIME DEPOSITS
(COST $250,000,000)		250,000,000
TOTAL INVESTMENT
SECURITIES (COST
$4,674,042,170) — 93.5%		4,674,042,170

____________________
 

Percentages indicated are based on net assets of $4,999,355,098.
(a)	Variable rate security. The interest rates on these securities are adjusted periodically to reflect then-current short-term interest rates. The rates presented represent the rates in effect on October 31, 2013. The maturity dates presented reflect the final maturity dates. However, some of these securities may contain put or demand features that allow the Fund to require the issuer to repurchase the security from the fund within various time periods, including daily, weekly, monthly, or semi-annually.
(b)	Rate presented represents the effective yield at time of purchase.
(c)	Rule 144A security or other security which is restricted as to resale to institutional investors. This security has been deemed liquid by the Investment Adviser based on procedures approved by the Board of Trustees.
(d)	Step Bond. Income recognition is on the effective yield method for Step Bonds.
LLC — Limited Liability Company MTN — Medium Term Note

 

12       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC U.S. GOVERNMENT MONEY MARKET FUND

Schedule of Portfolio Investments—as of October 31, 2013

U.S. Government and Government Agency Obligations – 16.6%
		Principal	Amortized
		Amount ($)	Cost ($)
Federal Farm Credit Bank – 3.5%
0.19%, 12/13/13		7,500,000	7,500,064
0.19%, 12/20/13(a), Series 2		6,000,000	6,000,000
0.23%, 12/30/13(a)		8,000,000	8,000,522
0.18%, 1/14/14(a)		7,500,000	7,499,848
0.03%, 2/10/14(a)		18,000,000	17,995,885
0.11%, 3/26/14(a), Series 1		23,500,000	23,500,153
0.12%, 6/6/14(a)		30,000,000	29,998,188
0.16%, 6/11/14		15,000,000	14,998,880
0.11%, 10/24/14(a), Series 1		18,000,000	17,999,092
0.18%, 2/27/15(a)		3,695,000	3,696,483
0.21%, 7/24/15(a)		7,500,000	7,509,217
			144,698,332
Federal Home Loan Bank – 7.5%
0.13%, 11/8/13		6,850,000	6,849,910
0.10%, 11/20/13, Series 2		25,000,000	24,999,905
0.38%, 11/27/13		11,000,000	11,002,082
0.13%, 12/6/13		11,550,000	11,549,252
0.13%, 12/10/13		7,000,000	6,999,569
0.34%, 12/18/13		4,300,000	4,300,704
0.16%, 12/20/13(a)		30,000,000	30,001,630
0.16%, 3/3/14(b)		45,000,000	44,976,362
0.17%, 3/24/14(b)		15,000,000	14,990,169
0.13%, 3/27/14		18,000,000	17,997,349
0.11%, 6/5/14(a)		75,000,000	74,997,478
0.10%, 6/27/14(a), Series 1		15,000,000	14,999,019
0.19%, 7/22/14		25,000,000	24,997,658
0.13%, 7/25/14		15,000,000	14,994,887
0.11%, 9/2/14(a)		15,000,000	14,999,372
			318,655,346
Federal Home Loan Mortgage Corp. – 4.2%
0.15%, 12/20/13(b)		19,000,000	18,996,121
0.16%, 10/16/15(a)		160,000,000	160,000,000
			178,996,121
Federal National Mortgage Association – 1.4%
0.09%, 2/5/14(b)		12,734,000	12,730,842
0.88%, 8/28/14		7,500,000	7,543,200
0.63%, 10/30/14		31,573,000	31,718,687
0.46%, 11/21/14(a), Series 1		6,000,000	6,022,416
0.34%, 1/27/15(a)		3,065,000	3,073,639
			61,088,784
TOTAL U.S. GOVERNMENT
AND GOVERNMENT
AGENCY OBLIGATIONS
(COST $703,438,583)			703,438,583
U.S. Treasury Obligations – 57.2%
U.S. Treasury Bills – 30.8%
0.21%, 11/14/13(b)		725,000,000	724,943,820
0.10%, 11/21/13(b)		280,000,000	279,984,047
0.12%, 12/5/13(b)		150,000,000	149,983,354
0.13%, 4/24/14(b)		150,000,000	149,907,563
			1,304,818,784
U.S. Treasury Notes – 26.4%
0.50%, 11/15/13		425,000,000	425,057,626
4.25%, 11/15/13		30,000,000	30,046,403
2.00%, 11/30/13		215,000,000	215,305,058
0.75%, 12/15/13		50,000,000	50,032,305
1.25%, 2/15/14		75,000,000	75,229,947
1.75%, 3/31/14		15,000,000	15,096,123
1.25%, 4/15/14		15,000,000	15,073,456
2.38%, 9/30/14		200,000,000	203,980,839
0.50%, 10/15/14		34,500,000	34,624,651
4.25%, 11/15/14		50,000,000	52,117,946
			1,116,564,354
TOTAL U.S. TREASURY
OBLIGATIONS
(COST $2,421,383,138)			2,421,383,138
Repurchase Agreements – 26.0%
Merrill Lynch Pierce, Fenner
& Smith, Inc. purchased on
10/31/13, 0.09%, due on
11/7/13 with a maturity value
of $150,002,625, collateralized
by various U.S. Government
and Government Agency
Obligations, 2.39%-3.00%,
4/1/33-4/1/43, fair value
$153,000,001	.	150,000,000	150,000,000
Barclays Capital Group, purchased
on 10/31/13, 0.07%, due on
11/7/13 with a maturity value
of $250,003,403, collateralized
by various U.S. Government
and Government Agency
Obligations, 3.50%-5.00%,
2/15/39-10/20/62, fair value
$255,000,001		250,000,000	250,000,000
BNP Paribas, purchased on
10/31/13, 0.11%, due on
11/1/13 with a maturity value
of $250,000,764, collateralized
by various U.S. Government
and Government Agency
Obligations, 3.00%-4.50%,
2/1/27-5/1/43, fair value
$255,000,000		250,000,000	250,000,000

See notes to financial statements. HSBC FAMILY OF FUNDS        13

HSBC U.S. GOVERNMENT MONEY MARKET FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

Repurchase Agreements, continued
	Principal	Amortized
	Amount ($)	Cost ($)
Citigroup Global Markets, purchased
on 10/31/13, 0.10%, due on
11/1/13 with a maturity value
of $250,000,694, collateralized by
various U.S. Government
and Government Agency
Obligations, 1.95%-6.50%,
11/1/19-10/1/43, fair value
$255,000,000	250,000,000	250,000,000
Deutsche Bank, purchased
on 10/31/13, 0.12%, due on
11/1/13 with a maturity value
of $200,000,667, collateralized
by various U.S. Government
and Government Agency
Obligations, 3.00%-4.00%,
11/1/26-8/1/43, fair value
$204,000,000	200,000,000	200,000,000
TOTAL REPURCHASE
AGREEMENTS
(COST $1,100,000,000)		1,100,000,000
TOTAL INVESTMENT
SECURITIES (COST
$4,224,821,721) — 99.8%		4,224,821,721

____________________
 

Percentages indicated are based on net assets of $4,233,130,504.
(a)	Variable rate security. The rate presented represents the rate in effect at October 31, 2013. These securities are deemed to have a maturity remaining until the next adjustment of the interest rate or the longer of the demand period or time to the next readjustment.
(b)	Discount note. Rate presented represents the effective yield at time of purchase.

14       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC U.S. TREASURY MONEY MARKET FUND

Schedule of Portfolio Investments–as of October 31, 2013

U.S. Treasury Obligations – 99.5%
	Principal	Amortized
	Amount ($)	Cost ($)
U.S. Treasury Bills – 52.2%
0.14%, 11/7/13 (a)	217,000,000	216,996,142
0.14%, 11/14/13 (a)	908,000,000	907,950,029
0.16%, 11/29/13 (a)	75,000,000	74,990,667
0.05%, 12/19/13 (a)	75,000,000	74,995,001
0.03%, 1/2/14 (a)	70,000,000	69,996,082
		1,344,927,921
U.S. Treasury Notes – 47.3%
0.50%, 11/15/13	325,000,000	325,054,584
4.25%, 11/15/13	125,000,000	125,200,270
2.00%, 11/30/13	225,000,000	225,336,259
0.75%, 12/15/13	65,000,000	65,050,462
1.00%, 1/15/14	150,000,000	150,280,534
4.00%, 2/15/14	10,000,000	10,112,855
0.25%, 2/28/14	40,000,000	40,012,571
1.25%, 3/15/14	125,000,000	125,532,255
0.63%, 7/15/14	30,000,000	30,095,755
2.38%, 8/31/14	25,000,000	25,457,708
2.38%, 10/31/14	25,000,000	25,557,816
4.25%, 11/15/14	65,000,000	67,757,229
		1,215,448,298
TOTAL U.S. TREASURY OBLIGATIONS (COST $2,560,376,219)		2,560,376,219
TOTAL INVESTMENT SECURITIES — 99.5%		2,560,376,219

____________________
 

Percentages indicated are based on net assets of $2,572,320,882.
(a)	Discount note. Rate presented represents the effective yield at time of purchase.

See notes to financial statements. HSBC FAMILY OF FUNDS      15

HSBC FAMILY OF FUNDS

Statements of Assets and Liabilities—as of October 31, 2013

				U.S.
	Prime			Government				U.S. Treasury
	Money Market			Money Market				Money Market
	Fund			Fund				Fund
Assets:
Investments, at value and amortized cost		$	4,674,042,170		$	3,124,821,721			$	2,560,376,219
Repurchase agreements, at value and cost			—			1,100,000,000				—
Total Investments			4,674,042,170			4,224,821,721				2,560,376,219
Cash			322,081,559			3,566,463				4,733,511
Interest receivable			4,034,903			5,300,727				7,467,502
Receivable for capital shares issued			78,396			35,021				—
Prepaid expenses			103,900			107,809				73,083
Total Assets			5,000,340,928			4,233,831,741				2,572,650,315
Liabilities:
Dividends payable			97,723			39,714				—
Accrued expenses and other liabilities:
Investment Management			376,642			275,690				117,076
Administration			204,269			153,503				77,925
Compliance Services			259			47				130
Accounting			373			252				451
Custodian			71,446			58,670				33,530
Transfer Agent			8,154			6,034				6,055
Trustee			15,190			4,454				130
Other			211,774			162,873				94,136
Total Liabilities			985,830			701,237				329,433
Net Assets		$	4,999,355,098		$	4,233,130,504			$	2,572,320,882
Composition of Net Assets:
Capital			4,999,346,354			4,233,220,928				2,572,370,281
Accumulated net realized gains (losses) from investments			8,744			(90,424	)			(49,399	)
Net Assets		$	4,999,355,098		$	4,233,130,504			$	2,572,320,882
Net Assets:
Class A Shares		$	42,158,371		$	428,135			$	5,099
Class B Shares			28,181			48,741				—
Class C Shares			2			—				—
Class D Shares			1,288,077,154			670,892,508				517,845,253
Class I Shares			3,121,056,022			1,156,893,808				1,086,180,728
Class Y Shares			548,035,368			2,404,867,312				968,289,802
		$	4,999,355,098		$	4,233,130,504			$	2,572,320,882
Shares Outstanding
($0.001 par value, unlimited number of shares authorized):
Class A Shares			42,158,898			428,148				5,091
Class B Shares			28,210			48,730				—
Class C Shares			2			—				—
Class D Shares			1,288,015,088			670,724,760				517,853,599
Class I Shares			3,121,128,793			1,157,028,933				1,086,229,016
Class Y Shares			548,029,587			2,404,990,715				968,287,545
Net Asset Value, Offering Price and Redemption Price per share:
Class A Shares		$	1.00		$	1.00			$	1.00
Class B Shares(a)		$	1.00		$	1.00			$	—
Class C Shares(a)		$	1.00		$	—			$	—
Class D Shares		$	1.00		$	1.00			$	1.00
Class I Shares		$	1.00		$	1.00			$	1.00
Class Y Shares		$	1.00		$	1.00			$	1.00

____________________       

(a)        Redemption Price per share varies by length of time shares are held.

16       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC FAMILY OF FUNDS

Statements of Operations—For the year ended October 31, 2013

					U.S.
	Prime				Government				U.S. Treasury
	Money Market				Money Market				Money Market
	Fund				Fund				Fund
Investment Income:
Interest		$	12,606,310			$	6,812,816			$	2,335,533
Total Investment Income			12,606,310				6,812,816				2,335,533
Expenses:
Investment Management			5,131,209				4,745,532				2,566,350
Advisory Services:
Operational Support - Class A Shares			40,057				18,952				4
Operational Support - Class B Shares			32				61				—
Operational Support - Class C Shares			2				—				—
Operational Support - Class D Shares			1,359,346				614,527				656,884
Operational Support - Class Y Shares			619,399				2,566,083				1,343,234
Administration:
Class A Shares			19,937				9,312				2
Class B Shares			15				31				—
Class D Shares			675,695				305,595				325,809
Class I Shares			1,546,685				768,238				281,884
Class Y Shares			308,099				1,274,738				667,932
Distribution:
Class B Shares			241				459				5
Class C Shares			10				—				—
Shareholder Servicing:
Class A Shares			160,114				75,809				22
Class B Shares			80				152				2
Class C Shares			3				—				—
Class D Shares			3,396,688				1,536,330				1,642,223
Accounting			77,399				68,524				66,255
Compliance Services			110,467				100,146				54,603
Custodian			306,828				272,011				155,093
Printing			161,588				53,656				13,772
Professional			407,211				362,247				216,569
Transfer Agent			49,211				36,333				36,424
Trustee			322,451				300,630				154,014
Registration fees			81,964				79,344				77,694
Other			274,538				159,470				119,978
Total expenses before fee reductions			15,049,269				13,348,180				8,378,753
Fees voluntarily reduced/reimbursed by Investment Adviser			(1,474,820	)			(4,977,753	)			(4,055,018	)
Fees voluntarily reduced by Administrator			(6,088	)			(489,242	)			(325,686	)
Fees voluntarily reduced/reimbursed by Distributor			(251	)			(459	)			(5	)
Fees voluntarily reduced/reimbursed by Shareholder Servicing Agent			(3,550,514	)			(1,612,291	)			(1,642,247	)
Fees paid indirectly			—				(31,032	)			(20,264	)
Net Expenses			10,017,596				6,237,403				2,335,533
Net Investment Income			2,588,714				575,413				—
Net realized gains (losses) from investments			8,744				(86,858	)			(37,989	)
Change In Net Assets Resulting From Operations		$	2,597,458			$	488,555			$	(37,989	)

See notes to financial statements. HSBC FAMILY OF FUNDS      17

HSBC FAMILY OF FUNDS

Statements of Changes in Net Assets

	Prime								U.S. Government
	Money Market Fund								Money Market Fund
	For the				For the				For the				For the
	year ended				year ended				year ended				year ended
	October 31, 2013				October 31, 2012				October 31, 2013				October 31, 2012
Investment Activities:
Operations:
Net investment income		$	2,588,714			$	5,657,344			$	575,413			$	589,074
Net realized gains (losses) from investments			8,744				24,826				(86,858	)			2,240
Change in net assets resulting from operations			2,597,458				5,682,170				488,555				591,314
Dividends:
Net investment income:
Class A Shares			(4,311	)			(2,958	)			(1,885	)			(169	)
Class B Shares			(4	)			(7	)			(6	)			(8	)
Class C Shares			(1	)			(4	)			—				—
Class D Shares			(145,852	)			(143,373	)			(62,841	)			(64,809	)
Class I Shares			(2,366,911	)			(5,344,845	)			(248,433	)			(290,312	)
Class Y Shares			(71,635	)			(166,157	)			(262,248	)			(233,776	)
Net realized gains:
Class A Shares			(78	)			—				—				(35	)
Class B Shares			—				—				—				(1	)
Class D Shares			(2,967	)			—				—				(7,445	)
Class I Shares			(7,143	)			—				—				(19,650	)
Class Y Shares			(1,258	)			—				—				(18,416	)
Change in net assets resulting from
shareholder dividends			(2,600,160	)			(5,657,344	)			(575,413	)			(634,621	)
Change in net assets resulting from
capital transactions			18,941,569				(1,590,758,408	)			(760,210,896	)			885,763,811
Change in net assets			18,938,867				(1,590,733,582	)			(760,297,754	)			885,720,504
Net Assets:
Beginning of period			4,980,416,231				6,571,149,813				4,993,428,258				4,107,707,754
End of period		$	4,999,355,098			$	4,980,416,231			$	4,233,130,504			$	4,993,428,258
Accumulated net investment income		$	—			$	—			$	—			$	2

18       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC FAMILY OF FUNDS

Statements of Changes in Net Assets (continued)

	Prime								U.S. Government
	Money Market Fund								Money Market Fund
	For the				For the				For the				For the
	year ended				year ended				year ended				year ended
	October 31, 2013				October 31, 2012				October 31, 2013				October 31, 2012
CAPITAL TRANSACTIONS:*
Class A Shares:
Proceeds from shares issued		$	10,044,534			$	11,405,354			$	100,773,881			$	12,635,616
Dividends reinvested			149				102				385				18
Value of shares redeemed			(1,432,410	)			(5,622,050	)			(100,584,674	)			(16,391,097	)
Class A Shares capital transactions			8,612,273				5,783,406				189,592				(3,755,463	)
Class B Shares:
Proceeds from shares issued			—				19,430				—				—
Dividends reinvested			4				6				6				9
Value of shares redeemed			(13,118	)			(110,006	)			(27,646	)			(17,135	)
Class B Shares capital transactions			(13,114	)			(90,570	)			(27,640	)			(17,126	)
Class C Shares:
Proceeds from shares issued			373				745				—				—
Dividends reinvested			1				4				—				—
Value of shares redeemed			(6,130	)			(777	)			—				—
Class C Shares capital transactions			(5,756	)			(28	)			—				—
Class D Shares:
Proceeds from shares issued			5,119,755,763				5,747,496,581				2,284,815,817				2,112,895,877
Dividends reinvested			109,668				112,060				29,381				41,463
Value of shares redeemed			(5,135,614,581	)			(6,035,401,728	)			(2,228,438,235	)			(2,244,889,380	)
Class D Shares capital transactions			(15,749,150	)			(287,793,087	)			56,406,963				(131,952,040	)
Class I Shares:
Proceeds from shares issued			26,195,455,773				37,580,221,468				10,153,237,542				15,350,488,166
Dividends reinvested			1,231,509				2,814,430				152,717				206,034
Value of shares redeemed			(26,101,317,973	)			(38,866,710,107	)			(10,869,649,354	)			(15,123,273,533	)
Class I Shares capital transactions			95,369,309				(1,283,674,209	)			(716,259,095	)			227,420,667
Class Y Shares:
Proceeds from shares issued			1,790,806,941				2,112,812,015				20,359,087,706				16,530,799,457
Dividends reinvested			66,154				146,189				259,866				250,271
Value of shares redeemed			(1,860,145,088	)			(2,137,942,124	)			(20,459,868,288	)			(15,736,981,955	)
Class Y Shares capital transactions			(69,271,993	)			(24,983,920	)			(100,520,716	)			794,067,773
Change in net assets resulting from
capital transactions		$	18,941,569			$	(1,590,758,408	)		$	(760,210,896	)		$	885,763,811

____________________

*       Share transactions are at net asset value of $1.00 per share.

See notes to financial statements. HSBC FAMILY OF FUNDS     19

HSBC FAMILY OF FUNDS

Statements of Changes in Net Assets (continued)

	U.S. Treasury
	Money Market Fund
	For the				For the
	year ended				year ended
	October 31, 2013				October 31, 2012
Investment Activities:
Operations:
Net investment income		$	—			$	9
Net realized gains (losses) from investments transactions			(37,989	)			8,482
Change in net assets resulting from operations			(37,989	)			8,491
Dividends:
Net realized gains:
Class D Shares			—				(6,485	)
Class I Shares			—				(6,826	)
Class Y Shares			—				(10,955	)
Change in net assets resulting from shareholder dividends			—				(24,266	)
Change in net assets resulting from capital transactions			198,372,690				(229,081,790	)
Change in net assets			198,334,701				(229,097,565	)
Net Assets:
Beginning of period			2,373,986,181				2,603,083,746
End of period		$	2,572,320,882			$	2,373,986,181
Accumulated net investment income		$	—			$	9

20       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC FAMILY OF FUNDS

Statements of Changes in Net Assets (continued)

	U.S. Treasury
	Money Market Fund
	For the				For the
	year ended				year ended
	October 31, 2013				October 31, 2012
CAPITAL TRANSACTIONS:*
Class A Shares:
Value of shares redeemed		$	—			$	(607,887	)
Class A Shares capital transactions			—				(607,887	)
Class B Shares:
Value of shares redeemed			(1,031	)			(34,382	)
Class B Shares capital transactions			(1,031	)			(34,382	)
Class C Shares:
Proceeds from shares issued			—				114,177
Value of shares redeemed			—				(114,177	)
Class C Shares capital transactions			—				—
Class D Shares:
Proceeds from shares issued			2,077,685,254				1,836,487,946
Dividends reinvested			—				2,757
Value of shares redeemed			(2,221,893,975	)			(1,794,363,660	)
Class D Shares capital transactions			(144,208,721	)			42,127,043
Class I Shares:
Proceeds from shares issued			5,092,587,899				2,342,393,162
Dividends reinvested			—				3,734
Value of shares redeemed			(4,561,678,583	)			(2,770,079,317	)
Class I Shares capital transactions			530,909,316				(427,682,421	)
Class Y Shares:
Proceeds from shares issued			1,876,855,817				1,844,352,806
Dividends reinvested			—				10,587
Value of shares redeemed			(2,065,182,691	)			(1,687,247,536	)
Class Y Shares capital transactions			(188,326,874	)			157,115,857
Change in net assets resulting from capital transactions		$	198,372,690			$	(229,081,790	)

____________________

*       Share transactions are at net asset value of $1.00 per share.

See notes to financial statements. HSBC FAMILY OF FUNDS       21

HSBC PRIME MONEY MARKET FUND

Financial Highlights

Selected data for a share outstandingthroughout the periodsindicated.

				Investment Activities					Dividends										Ratios/Supplementary Data
							Net																		Ratio of						Ratios of
							Realized and																		Expenses						Expenses
							Unrealized			Net				Net											to Average			Ratio of Net			to Average
	Net Asset						Gains			Realized				Asset								Ratio of Net			Net Assets			Investment			Net Assets
	Value,			Net			(Losses)	Total from	Net	Gains from				Value,					Net Assets at			Expenses to			(Excluding			Income to			(Excluding
	Beginning			Investment			from	Investment	Investment	Investment			Total	End of			Total		End of Period			Average Net			Fees Paid			Average Net			Fee
	of Period			Income			Investments	Activities	Income	Transactions			Dividends	Period			Return(a)		(000’s)			Assets			Indirectly)			Assets			Reductions)
CLASS A SHARES
Year Ended October 31, 2009		$	1.00		—	(b)	—(b)	—(b)	—(b)		—		—(b)		$	1.00	0.32	%(c)	$	343,265			0.55	%(c)		0.55	%(c)		0.31	%(c)		0.69	%(c)
Year Ended October 31, 2010			1.00		—	(b)(d)	—(b)	—(b)	—(b)		—		—(b)			1.00	0.01	%(e)		32,943			0.29	%		0.29	%		0.01	%(e)		0.67	%
Year Ended October 31, 2011			1.00		—	(b)(d)	—(b)	—(b)	—(b)		—		—(b)			1.00	0.01	%		27,763			0.26	%		0.26	%		0.01	%		0.68	%
Year Ended October 31, 2012			1.00		—	(b)	—(b)	—(b)	—(b)		—		—(b)			1.00	0.01	%		33,546			0.30	%		0.30	%		0.01	%		0.69	%
Year Ended October 31, 2013			1.00		—	(b)(d)	—(b)	—(b)	—(b)		—	(b)	—(b)			1.00	0.01	%		42,158			0.23	%		0.23	%		0.01	%		0.68	%
CLASS B SHARES
Year Ended October 31, 2009		$	1.00		—	(b)	—(b)	—(b)	—		—		—		$	1.00	0.17	%(c)	$	312			0.68	%(c)		0.68	%(c)		0.13	%(c)		1.30	%(c)
Year Ended October 31, 2010			1.00		—	(b)(d)	—(b)	—(b)	—(b)		—		—(b)			1.00	0.01	%(e)		226			0.29	%		0.29	%		0.01	%(e)		1.27	%
Year Ended October 31, 2011			1.00		—	(b)(d)	—(b)	—(b)	—(b)		—		—(b)			1.00	0.01	%		132			0.26	%		0.26	%		0.01	%		1.28	%
Year Ended October 31, 2012			1.00		—	(b)	—(b)	—(b)	—(b)		—		—(b)			1.00	0.01	%		41			0.29	%		0.29	%		0.01	%		1.29	%
Year Ended October 31, 2013			1.00		—	(b)(d)	—(b)	—(b)	—(b)		—	(b)	—(b)			1.00	0.01	%		28			0.24	%		0.24	%		0.01	%		1.28	%
CLASS C SHARES
Year Ended October 31, 2009		$	1.00		—	(b)	—(b)	—(b)	—(b)		—		—(b)		$	1.00	0.17	%(c)	$	259,364			0.74	%(c)		0.74	%(c)		0.19	%(c)		1.29	%(c)
Year Ended October 31, 2010			1.00		—	(b)(d)	—(b)	—(b)	—(b)		—		—(b)			1.00	0.01	%(e)		44			0.29	%		0.29	%		0.01	%(e)		1.27	%
Year Ended October 31, 2011			1.00		—	(b)(d)	—(b)	—(b)	—(b)		—		—(b)			1.00	0.01	%		6			0.25	%		0.25	%		0.01	%		1.28	%
Year Ended October 31, 2012			1.00		—	(b)	—(b)	—(b)	—(b)		—		—(b)			1.00	0.06	%		6			0.25	%		0.25	%		0.06	%		1.29	%
Year Ended October 31, 2013			1.00		—	(b)(d)	—(b)	—(b)	—(b)		—	(b)	—(b)			1.00	0.01	%		—	(f)		0.23	%		0.23	%		0.07	%		1.26	%
CLASS D SHARES
Year Ended October 31, 2009		$	1.00		—	(b)	—(b)	—(b)	—(b)		—		—(b)		$	1.00	0.40	%(c)	$	1,994,448			0.49	%(c)		0.49	%(c)		0.42	%(c)		0.54	%(c)
Year Ended October 31, 2010			1.00		—	(b)(d)	—(b)	—(b)	—(b)		—		—(b)			1.00	0.01	%(e)		1,695,222			0.29	%		0.29	%		0.01	%(e)		0.52	%
Year Ended October 31, 2011			1.00		—	(b)(d)	—(b)	—(b)	—(b)		—		—(b)			1.00	0.01	%		1,591,614			0.26	%		0.26	%		0.01	%		0.53	%
Year Ended October 31, 2012			1.00		—	(b)	—(b)	—(b)	—(b)		—		—(b)			1.00	0.01	%		1,303,827			0.30	%		0.30	%		0.01	%		0.54	%
Year Ended October 31, 2013			1.00		—	(b)(d)	—(b)	—(b)	—(b)		—	(b)	—(b)			1.00	0.01	%		1,288,077			0.23	%		0.23	%		0.01	%		0.53	%

22       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC PRIME MONEY MARKET FUND

FinancialHighlights(continued)

				InvestmentActivities									Dividends															Ratios/Supplementary Data
	Net Asset Value, Beginning of Period			Net Investment Income			Net Realized and Unrealized Gains (Losses) from Investments			Total from Investment Activities			Net Investment Income			Net Realized Gains from Investment Transactions			Total Dividends			Net Asset Value, End of Period			Total Return(a)			Net Assets at End of Period (000’s)			Ratio of Net Expenses to Average Net Assets			Ratio of Expenses to Average Net Assets (Excluding Fees Paid Indirectly)			Ratio of Net Investment Income to Average Net Assets			Ratios of Expenses to Average Net Assets (Excluding Fee Reductions)
CLASS I SHARES
Year Ended October 31, 2009		$	1.00		0.01			—	(b)		0.01			(0.01	)		—			(0.01	)		$	1.00		0.69	%(c)		$	7,189,613		0.18	%(c)		0.18	%(c)		0.55	%(c)		0.19	%(c)
Year Ended October 31, 2010			1.00		—	(b)(d)		—	(b)		—	(b)		—	(b)		—			—	(b)			1.00		0.14	%(e)			4,679,632		0.17	%		0.17	%		0.14	%(e)		0.17	%
Year Ended October 31, 2011			1.00		—	(b)(d)		—	(b)		—	(b)		—	(b)		—			—	(b)			1.00		0.10	%			4,309,346		0.17	%		0.17	%		0.10	%		0.18	%
Year Ended October 31, 2012			1.00		—	(b)		—	(b)		—	(b)		—	(b)		—			—	(b)			1.00		0.14	%			3,025,688		0.17	%		0.17	%		0.14	%		0.19	%
Year Ended October 31, 2013			1.00		—	(b)(d)		—	(b)		—	(b)		—	(b)		—	(b)		—	(b)			1.00		0.08	%			3,121,056		0.17	%		0.17	%		0.08	%		0.18	%
CLASS Y SHARES
Year Ended October 31, 2009		$	1.00		0.01			—	(b)		0.01			(0.01	)		—			(0.01	)		$	1.00		0.58	%(c)		$	1,194,680		0.29	%(c)		0.29	%(c)		0.68	%(c)		0.29	%(c)
Year Ended October 31, 2010			1.00		—	(b)(d)		—	(b)		—	(b)		—	(b)		—			—	(b)			1.00		0.05	%(e)			1,107,571		0.26	%		0.26	%		0.04	%(e)		0.27	%
Year Ended October 31, 2011			1.00		—	(b)(d)		—	(b)		—	(b)		—	(b)		—			—	(b)			1.00		0.01	%			642,290		0.26	%		0.26	%		0.02	%		0.28	%
Year Ended October 31, 2012			1.00		—	(b)		—	(b)		—	(b)		—	(b)		—			—	(b)			1.00		0.03	%			617,308		0.28	%		0.28	%		0.03	%		0.29	%
Year Ended October 31, 2013			1.00		—	(b)(d)		—	(b)		—	(b)		—	(b)		—	(b)		—	(b)			1.00		0.01	%			548,035		0.23	%		0.23	%		0.01	%		0.28	%

(a)	Total returns do not include redemption charges.
(b)	Represents less than $0.005 or $(0.005).
(c)	Included in the ratios are the Treasury Guarantee Program fees incurred by the Fund during the period. Without these fees, the gross and net expense ratios would have been decreased by 0.03% and the total return and net investment income ratio would have increased by 0.03%.
(d)	Calculated based on average shares outstanding.
(e)	During the year ended October 31, 2010, the Fund received a distribution from a “fair fund” established by the SEC in connection with a consent order against BISYS Fund Services, Inc. (See Note 6 in Notes to Financial Statements). The corresponding impact to the net income ratio and the total return was less than 0.005%.
(f)	Less than $500.

See notes to financial statements. HSBC FAMILY OF FUNDS       23

HSBC U.S. GOVERNMENT MONEY MARKET FUND

FinancialHighlights(continued)

Selected data for a share outstandingthroughout the periodsindicated.

				InvestmentActivities									Dividends															Ratios/Supplementary Data
	Net Asset Value, Beginning of Period			Net Investment Income			Net Realized and Unrealized Gains (Losses) from Investments			Total from Investment Activities			Net Investment Income			Net Realized Gains from Investment Transactions			Total Dividends			Net Asset Value, End of Period			Total Return(a)			Net Assets at End of Period (000’s)				Ratio of Net Expenses to Average Net Assets(b)			Ratio of Expenses to Average Net Assets (Excluding Fees Paid Indirectly)(b)			Ratio of Net Investment Income to Average Net Assets(b)			Ratios of Expenses to Average Net Assets (Excluding Fee Reductions) (b)
CLASS A SHARES
Year Ended October 31, 2009		$	1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		$	1.00		0.14	%(d)		$	574,577			0.52	%(d)		0.52	%(d)		0.14	%(d)		0.72	%(d)
Year Ended October 31, 2010			1.00		—			—			—			—	(c)		—	(c)		—	(c)			1.00		0.02	%(e)			25,926			0.23	%		0.23	%		0.01	%(e)		0.67	%
Year Ended October 31, 2011			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—			—	(c)			1.00		0.01	%			3,995			0.16	%		0.16	%		0.01	%		0.68	%
Year Ended October 31, 2012			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)			1.00		0.01	%			238			0.14	%		0.15	%		0.01	%		0.69	%
Year Ended October 31, 2013			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—			—	(c)			1.00		0.01	%			428			0.17	%		0.17	%		0.01	%		0.68	%
CLASS B SHARES
Year Ended October 31, 2009		$	1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		$	1.00		0.08	%(d)		$	84			0.54	%(d)		0.54	%(d)		0.08	%(d)		1.30	%(d)
Year Ended October 31, 2010			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)			1.00		0.02	%(e)			88			0.22	%		0.22	%		0.01	%(e)		1.27	%
Year Ended October 31, 2011			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—			—	(c)			1.00		0.01	%			94			0.17	%		0.17	%		0.01	%		1.28	%
Year Ended October 31, 2012			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)			1.00		0.01	%			76			0.16	%		0.16	%		0.01	%		1.29	%
Year Ended October 31, 2013			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—			—	(c)			1.00		0.01	%			49			0.14	%		0.14	%		0.01	%		1.28	%
CLASS C SHARES
Year Ended October 31, 2009(f)		$	1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		$	1.00		0.08	%(d)		$	229			0.50	%(d)		0.50	%(d)		0.04	%(d)		1.32	%(d)
Year Ended October 31, 2010(g)			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)			1.00		0.02	%(e)			—	(h)		0.23	%		0.23	%		0.01	%(e)		1.27	%
Year Ended October 31, 2011(i)			1.00		—			—			—			—			—			—				1.00		—	%			—			—	%		—	%		—	%		—	%
Year Ended October 31, 2012(i)			1.00		—			—			—			—			—			—				1.00		—	%			—			—	%		—	%		—	%		—	%
Year Ended October 31, 2013(i)			1.00		—			—			—			—			—			—				1.00		—	%			—			—	%		—	%		—	%		—	%
CLASS D SHARES
Year Ended October 31, 2009		$	1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		$	1.00		0.18	%(d)		$	767,551			0.48	%(d)		0.48	%(d)		0.21	%(d)		0.58	%(d)
Year Ended October 31, 2010			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)			1.00		0.02	%(e)			922,510			0.22	%		0.22	%		0.02	%(e)		0.52	%
Year Ended October 31, 2011			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—			—	(c)			1.00		0.01	%			746,458			0.17	%		0.17	%		0.01	%		0.53	%
Year Ended October 31, 2012			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)			1.00		0.01	%			614,499			0.16	%		0.16	%		0.01	%		0.54	%
Year Ended October 31, 2013			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—			—	(c)			1.00		0.01	%			670,893			0.13	%		0.13	%		0.01	%		0.53	%

24       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC U.S. GOVERNMENT MONEY MARKET FUND

FinancialHighlights(continued)

				InvestmentActivities									Dividends															Ratios/Supplementary Data
	Net Asset Value, Beginning of Period			Net Investment Income			Net Realized and Unrealized Gains (Losses) from Investments			Total from Investment Activities			Net Investment Income			Net Realized Gains from Investment Transactions			Total Dividends			Net Asset Value, End of Period			Total Return(a)			Net Assets at End of Period (000’s)		Ratio of Net Expenses to Average Net Assets(b)			Ratio of Expenses to Average Net Assets (Excluding Fees Paid Indirectly)(b)			Ratio of Net Investment Income to Average Net Assets(b)			Ratios of Expenses to Average Net Assets (Excluding Fee Reductions) (b)
CLASS I SHARES
Year Ended October 31, 2009		$	1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		$	1.00		0.43	%(d)		$8,176,980		0.22	%(d)		0.22	%(d)		0.38	%(d)		0.22	%(d)
Year Ended October 31, 2010			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)			1.00		0.08	%(e)		5,100,891		0.16	%		0.16	%		0.07	%(e)		0.17	%
Year Ended October 31, 2011			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—			—	(c)			1.00		0.03	%		1,645,764		0.16	%		0.16	%		0.03	%		0.18	%
Year Ended October 31, 2012			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)			1.00		0.02	%		1,873,166		0.16	%		0.16	%		0.01	%		0.19	%
Year Ended October 31, 2013			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—			—	(c)			1.00		0.01	%		1,156,894		0.13	%		0.13	%		0.02	%		0.18	%
CLASS Y SHARES
Year Ended October 31, 2009		$	1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		$	1.00		0.32	%(d)		$3,370,299		0.33	%(d)		0.33	%(d)		0.38	%(d)		0.33	%(d)
Year Ended October 31, 2010			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)			1.00		0.02	%(e)		2,918,347		0.22	%		0.22	%		0.02	%(e)		0.27	%
Year Ended October 31, 2011			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—			—	(c)			1.00		0.01	%		1,711,397		0.17	%		0.17	%		0.01	%		0.28	%
Year Ended October 31, 2012			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)			1.00		0.01	%		2,505,448		0.17	%		0.17	%		0.01	%		0.29	%
Year Ended October 31, 2013			1.00		—	(c)		—	(c)		—	(c)		—	(c)		—			—	(c)			1.00		0.01	%		2,404,867		0.13	%		0.13	%		0.01	%		0.28	%

(a)	Not annualized for periods less than one year. Total return calculations do not include any sales or redemption charges.
(b)	Annualized for periods less than one year.
(c)	Represents less than $0.005 or $(0.005).
(d)	Included in the ratios are the Treasury Guarantee Program fees incurred by the Fund during the period. Without these fees, the gross and net expense ratios would have been decreased by 0.06% and the total return and net investment income ratio would have increased by 0.06%.
(e)	During the year ended October 31, 2010, the Fund received a distribution from a “fair fund” established by the SEC in connection with a consent order against BISYS Fund Services, Inc. (See Note 6 in Notes to Financial Statements). The corresponding impact to the net income ratio and the total return was less than 0.005%.
(f)	Class C Shares were operational during a portion of the year only. Amounts reflect performance for the period of time the class had operations, which was 362 days during the period.
(g)	Class C Shares were operational during a portion of the year only. Amounts reflect performance for the period of time the class had operations, which was 351 days during the period.
(h)	Less than $500.
(i)	During the period the class had no operations. The net asset values reflected represent the last day the class had shareholders.

See notes to financial statements. HSBC FAMILY OF FUNDS       25

HSBC U.S. TREASURY MONEY MARKET FUND

FinancialHighlights(continued)

Selected data for a share outstandingthroughout the periodsindicated.

				InvestmentActivities									Dividends															Ratios/Supplementary Data
	Net Asset Value, Beginning of Period			Net Investment Income			Net Realized and Unrealized Gains (Losses) from Investments			Total from Investment Activities			Net Investment Income			Net Realized Gains from Investment Transactions			Total Dividends			Net Asset Value, End of Period			Total Return(a)			Net Assets at End of Period(000’s)				Ratio of Net Expenses to Average Net Assets(b)			Ratio of Expenses to Average Net Assets (Excluding Fees Paid Indirectly) (b)			Ratio of Net Investment Income to Average Net Assets (b)			Ratios of Expenses to Average Net Assets (Excluding Fee Reductions) (b)
CLASS A SHARES
Year Ended October 31, 2009		$	1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		$	1.00		0.07	%		$	385,994			0.24	%		0.24	%		0.07	%		0.66	%
Year Ended October 31, 2010			1.00		—	(c)(d)		—	(c)		—	(c)		—	(c)		—			—	(c)			1.00		0.01	%(e)			32,973			0.14	%		0.14	%		0.01	%(e)		0.67	%
Year Ended October 31, 2011			1.00		—	(c)(d)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)			1.00		0.01	%			613			0.11	%		0.12	%		0.01	%		0.68	%
Year Ended October 31, 2012			1.00		—	(c)		—	(c)		—	(c)		—			—	(c)		—	(c)			1.00		—	%			5			0.05	%		0.06	%		—	%		0.70	%
Year Ended October 31, 2013			1.00		—	(c)		—	(c)		—	(c)		—			—			—				1.00		—	%			5			0.10	%		0.10	%		—	%		0.69	%
CLASS B SHARES
Year Ended October 31, 2009		$	1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		$	1.00		0.07	%		$	60			0.24	%		0.24	%		0.07	%		1.26	%
Year Ended October 31, 2010			1.00		—	(c)(d)		—	(c)		—	(c)		—	(c)		—			—	(c)			1.00		0.01	%(e)			50			0.14	%		0.14	%		0.01	%(e)		1.27	%
Year Ended October 31, 2011			1.00		—	(c)(d)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)			1.00		0.01	%			35			0.10	%		0.10	%		0.01	%		1.28	%
Year Ended October 31, 2012			1.00		—	(c)		—	(c)		—	(c)		—			—	(c)		—	(c)			1.00		—	%			1			0.06	%		0.06	%		—	%		1.29	%
Year Ended October 31, 2013(f)			1.00		—	(c)		—	(c)		—	(c)		—			—			—				1.00		—	%			—			0.02	%		0.02	%		—	%		0.76	%
CLASS C SHARES
Year Ended October 31, 2009		$	1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		$	1.00		0.07	%		$	7,138			0.22	%		0.22	%		0.04	%		1.26	%
Year Ended October 31, 2010(g)			1.00		—	(c)(d)		—	(c)		—	(c)		—	(c)		—			—	(c)			1.00		0.01	%(e)			—	(h)		0.13	%		0.13	%		—	%(e)		1.27	%
Year Ended October 31, 2011(i)			1.00		—	(d)		—			—			—			—			—				1.00		—	%			—			—	%		—	%		—	%		—	%
Year Ended October 31, 2012(i)			1.00		—			—			—			—			—			—				1.00		—	%			—			—	%		—	%		—	%		—	%
Year Ended October 31, 2013(i)			1.00		—			—			—			—			—			—				1.00		—	%			—			—	%		—	%		—	%		—	%
CLASS D SHARES
Year Ended October 31, 2009		$	1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		$	1.00		0.07	%		$	955,652			0.23	%		0.23	%		0.06	%		0.51	%
Year Ended October 31, 2010			1.00		—	(c)(d)		—	(c)		—	(c)		—	(c)		—			—	(c)			1.00		0.01	%(e)			726,244			0.14	%		0.14	%		0.01	%(e)		0.52	%
Year Ended October 31, 2011			1.00		—	(c)(d)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)			1.00		0.01	%			619,940			0.10	%		0.10	%		0.01	%		0.53	%
Year Ended October 31, 2012			1.00		—	(c)		—	(c)		—	(c)		—			—	(c)		—	(c)			1.00		—	%			662,063			0.08	%		0.09	%		—	%		0.54	%
Year Ended October 31, 2013			1.00		—	(c)		—	(c)		—	(c)		—			—			—				1.00		—	%			517,845			0.09	%		0.09	%		—	%		0.53	%

26       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC U.S. TREASURY MONEY MARKET FUND

FinancialHighlights(continued)

				InvestmentActivities									Dividends															Ratios/Supplementary Data
	Net Asset Value, Beginning of Period			Net Investment Income			Net Realized and Unrealized Gains (Losses) from Investments			Total from Investment Activities			Net Investment Income			Net Realized Gains from Investment Transactions			Total Dividends			Net Asset Value, End of Period			Total Return(a)			Net Assets at End of Period(000’s)			Ratio of Net Expenses to Average Net Assets(b)			Ratio of Expenses to Average Net Assets (Excluding Fees Paid Indirectly) (b)			Ratio of Net Investment Income to Average Net Assets (b)			Ratios of Expenses to Average Net Assets (Excluding Fee Reductions) (b)
CLASS I SHARES
Year Ended October 31, 2009		$	1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		$	1.00		0.14	%		$	3,322,962		0.16	%		0.16	%		0.14	%		0.16	%
Year Ended October 31, 2010			1.00		—	(c)(d)		—	(c)		—	(c)		—	(c)		—			—	(c)			1.00		0.01	%(e)			1,379,042		0.13	%		0.13	%		0.01	%(e)		0.17	%
Year Ended October 31, 2011			1.00		—	(c)(d)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)			1.00		0.01	%			982,974		0.10	%		0.10	%		0.01	%		0.18	%
Year Ended October 31, 2012			1.00		—	(c)		—	(c)		—	(c)		—			—	(c)		—	(c)			1.00		—	%			555,287		0.08	%		0.08	%		—	%		0.19	%
Year Ended October 31, 2013			1.00		—	(c)		—	(c)		—	(c)		—			—			—				1.00		—	%			1,086,181		0.09	%		0.09	%		—	%		0.18	%
CLASS Y SHARES
Year Ended October 31, 2009		$	1.00		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)		$	1.00		0.08	%		$	996,309		0.22	%		0.22	%		0.08	%		0.26	%
Year Ended October 31, 2010			1.00		—	(c)(d)		—	(c)		—	(c)		—	(c)		—			—	(c)			1.00		0.01	%(e)			1,147,150		0.14	%		0.14	%		0.01	%(e)		0.27	%
Year Ended October 31, 2011			1.00		—	(c)(d)		—	(c)		—	(c)		—	(c)		—	(c)		—	(c)			1.00		0.01	%			999,521		0.09	%		0.10	%		0.01	%		0.28	%
Year Ended October 31, 2012			1.00		—	(c)		—	(c)		—	(c)		—			—	(c)		—	(c)			1.00		—	%			1,156,631		0.09	%		0.09	%		—	%		0.29	%
Year Ended October 31, 2013			1.00		—	(c)		—	(c)		—	(c)		—			—			—				1.00		—	%			968,290		0.09	%		0.09	%		—	%		0.28	%

(a)	Not annualized for periods less than one year. Total return calculations do not include any sales or redemption charges.
(b)	Annualized for periods less than one year.
(c)	Represents less than $0.005 or $(0.005).
(d)	Calculated based on average shares outstanding.
(e)	During the year ended October 31, 2010, the Fund received a distribution from a “fair fund” established by the SEC in connection with a consent order against BISYS Fund Services, Inc. (See Note 6 in Notes to Financial Statements). The corresponding impact to the net income ratio and the total return was less than 0.005%.
(f)	Class B shares were operational during a portion of the year only. Amounts reflect performance for the period of time the class had operations, which was 249 days during the period. The net asset value reflected represents the last day the class had operations.
(g)	Class C Shares were operational during a portion of the year only. Amounts reflect performance for the period of time the class had operations, which was 351 days during the period.
(h)	Less than $500.
(i)	During the period the class had no operations. The net asset values reflected represent the last day the class had shareholders.

See notes to financial statements. HSBC FAMILY OF FUNDS       27

HSBC FAMILY OF FUNDS

Notes to Financial Statements—as of October 31, 2013

1. Organization:

     The HSBC Funds (the “Trust’’), a Massachusetts business trust organized on April 22, 1987, is registered under the Investment Company Act of 1940, as amended (the “Act’’), as an open-end management investment company. As of October 31, 2013, the Trust is comprised of 15 separate operational funds, each a series of the HSBC Family of Funds, which also includes the HSBC Advisor Funds Trust and the HSBC Portfolios (the “Trusts’’). The accompanying financial statements are presented for the following 3 funds (individually a “Fund,’’ collectively the “Funds’’):

Fund	Short Name
HSBC Prime Money Market Fund	Prime Money Market Fund
HSBC U.S. Government Money Market Fund	U.S. Government Money Market Fund
HSBC U.S. Treasury Money Market Fund	U.S. Treasury Money Market Fund

     All the Funds are diversified funds. Financial statements for all other funds of the Trusts are published separately.

     The Funds are authorized to issue an unlimited number of shares of beneficial interest with a par value of $ 0.001 per share. The Funds are authorized to issue seven classes of shares: Class A Shares, Class B Shares, Class C Shares, Class D Shares, Class E Shares, Class I Shares and Class Y Shares. The Class B Shares of the Funds are offered without any front-end sales charge but will be subject to a contingent deferred sales charge (“CDSC’’) ranging from a maximum of 4.00% if redeemed less than one year after purchase to 0.00% if redeemed more than four years after purchase. Class C Shares of the Funds are offered without any front-end sales charge but will be subject to a maximum CDSC of 1.00% if redeemed less than one year after purchase. No sales charges are assessed with respect to Class A, Class D, Class E, Class I or Class Y Shares of the Funds. Each class of shares in each Fund has identical rights and privileges, except with respect to arrangements pertaining to shareholder servicing and/or distribution, class-related expenses, voting rights on matters affecting a single class of shares, and exchange privileges. As of October 31, 2013, Class E Shares were not operational. Effective as of August 1, 2013, Class B Shares may no longer be purchased or acquired by any new or existing Class B shareholder, except through dividend and/or capital gains reinvestment.

     Under the Trust’s organizational documents, the Funds’ officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Funds. In addition, in the normal course of business, the Trust enters into contracts with its service providers, which also provide for indemnifications by the Funds. The Funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Funds. However, based on experience, the Trust expects that risk of loss to be remote.

2. Significant Accounting Policies:

     The following is a summary of the significant accounting policies followed by the Funds in the preparation of their financial statements. The policies are in conformity with U.S. generally accepted accounting principles (“GAAP’’). The preparation of financial statements requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

Securities Valuation:

     Investments of the Funds are valued using the amortized cost method pursuant to Rule 2a-7 under the Act, which approximates fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The valuation techniques used to determine fair value are further described in Note 3 below.

28       HSBC FAMILY OF FUNDS

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Notes to Financial Statements—as of October 31, 2013 (continued)

Investment Transactions and Related Income:

     Investment transactions are accounted for no later than one business day after trade date. However, for financial reporting purposes, investment transactions are accounted for on trade date. Investment gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date.

Restricted and Illiquid Securities:

     A restricted security is a security which has been purchased through a private offering and cannot be resold to the general public without prior registration under the Securities Act of 1933 (the “1933 Act’’) or pursuant to the resale limitations provided by Rule 144 under the 1933 Act, or another exemption from the registration requirements of the 1933 Act. Certain restricted securities may be resold in transactions exempt from registration, normally to qualified institutional buyers, and may be deemed liquid by the Investment Adviser (as defined in Note 4) based on procedures established by the Board of Trustees (the “Board’’). Therefore, not all restricted securities are considered illiquid. At October 31, 2013, the Funds did not hold any restricted securities that were deemed illiquid. The restricted securities held as of October 31, 2013 are identified below:

	Acquisition	Acquisition			Principal			Fair			% of
Prime Money Market Fund	Date	Cost			Amount			Value			Net Assets
Antalis US Funding Corp., 0.30%, 11/8/13	8/7/2013		$	17,426,629		$	17,440,000		$	17,438,983		0.3	%
ANZ New Zealand International Ltd., 0.28%, 4/15/14	4/15/2013			25,000,000			25,000,000			25,000,000		0.5	%
ASB Finance Ltd., Series GB, 0.30%, 9/2/14	8/29/2013			25,000,000			25,000,000			25,000,000		0.5	%
Australia & New Zealand Banking Group Ltd., 0.31%, 5/12/14	4/11/2013			25,000,000			25,000,000			25,000,000		0.5	%
Caisse Centrale Desjardins du Quebec, 0.13%, 11/1/13	10/1/2013			14,998,321			15,000,000			15,000,000		0.3	%
Caisse Centrale Desjardins du Quebec, 0.19%, 11/15/13	8/15/2013			29,985,817			30,000,000			29,997,842		0.6	%
Caisse Centrale Desjardins du Quebec, 0.24%, 2/19/14	9/10/2013			19,978,400			20,000,000			19,985,333		0.4	%
Caisse des Depots et Consignations, 0.20%, 11/29/13	7/30/2013			29,980,175			30,000,000			29,995,450		0.6	%
Caisse des Depots et Consignations, 0.24%, 1/2/14	7/26/2013			19,979,111			20,000,000			19,991,906		0.4	%
Caisse des Depots et Consignations, 0.35%, 8/29/14	9/6/2013			29,896,750			30,000,000			29,912,208		0.6	%
Collateralized CP II Co. LLC, 0.17%, 12/19/13	9/17/2013			59,973,933			60,000,000			59,986,400		1.2	%
Commonwealth Bank of Australia, 0.26%, 5/16/14	5/17/13			10,000,000			10,000,000			10,000,000		0.2	%
Commonwealth Bank of Australia, 0.98%, 3/17/14	2/14/2013			12,597,257			12,500,000			12,534,265		0.3	%
Commonwealth Bank of Australia, 2.13%, 3/17/14	5/21/2013			10,147,900			10,000,000			10,068,205		0.2	%
Commonwealth Bank of Australia, N.Y., 0.23%, 11/21/13	5/22/2013			64,925,656			65,000,000			64,991,875		1.3	%
Commonwealth Bank of Australia, N.Y., 0.25%, 9/11/14	9/11/2013			40,000,000			40,000,000			40,000,000		0.8	%
Commonwealth Bank of Australia, N.Y., 0.31%, 11/15/13	9/11/2013			30,007,140			30,000,000			30,001,666		0.6	%
DBS Bank Ltd., 0.24%, 1/10/14	7/9/2013			23,970,560			24,000,000			23,988,800		0.5	%
DnB NOR Bank ASA, N.Y., 0.20%, 12/23/13	9/4/2013			29,981,667			30,000,000			29,991,333		0.6	%
Erste Abwicklungsanstalt, 0.20%, 2/5/14	9/3/2013			84,927,750			85,000,000			84,954,667		1.7	%
Erste Abwicklungsanstalt, 0.35%, 2/12/14	2/12/2013			14,947,208			15,000,000			14,984,979		0.3	%
MetLife Short Term Funding LLC, 0.16%, 12/10/13	9/16/2013			21,991,689			22,000,000			21,996,187		0.4	%
National Australia Bank Ltd., 0.97%, 11/8/13	10/18/2013			15,807,612			15,800,000			15,802,538		0.3	%
National Australia Funding Delaware, Inc., 0.22%, 2/20/14	8/20/2013			19,978,022			20,000,000			19,986,742		0.4	%
Nordea Bank AB, 0.18%, 11/18/13	8/19/2013			49,977,500			50,000,000			49,995,750		1.0	%
Sumitomo Mitsui Banking Corp., N.Y., 0.12%, 11/1/13	10/25/2013			12,159,716			12,160,000			12,160,000		0.2	%
Svenska Handelsbanken, Inc., 0.25%, 2/4/14	8/8/2013			19,975,000			20,000,000			19,986,806		0.4	%
United Overseas Bank Ltd., 0.19%, 11/25/13	8/20/2013			29,984,800			30,000,000			29,996,200		0.6	%
United Overseas Bank Ltd., 0.22%, 3/10/14	10/23/2013			24,978,917			25,000,000			24,980,292		0.5	%
Westpac Banking Corp., 0.31%, 1/8/14	1/8/2013			15,000,000			15,000,000			15,000,000		0.3	%
Westpac Banking Corp., 0.98%, 3/31/14	3/22/2013			15,862,008			15,750,000			15,795,802		0.3	%
Westpac Securities NZ Ltd., 0.29%, 4/11/14	4/25/2013			29,001,044			29,000,000			29,000,482		0.6	%
Westpac Securities NZ Ltd., 0.34%, 11/29/13	9/25/2013			85,026,010			85,000,000			85,011,205		1.7	%

HSBC FAMILY OF FUNDS       29

HSBC FAMILY OF FUNDS

Notes to Financial Statements—as of October 31, 2013 (continued)

Repurchase Agreements:

     The Funds (except U.S. Treasury Money Market Fund) may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer’’ (as designated by the Federal Reserve Bank of New York) in U.S. government obligations. The U.S. Treasury Money Market Fund may temporarily invest in repurchase agreements collateralized by U.S. Treasury Obligations. The repurchase price generally equals the price paid by a Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller, under a repurchase agreement, is required to maintain the collateral held pursuant to the agreement, with a fair value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Funds’ custodian or another qualified custodian or in the Federal Reserve/ Treasury book-entry system. In the event of counterparty default, the Fund has the right to use the collateral to offset losses incurred. There is potential for loss to a Fund in the event the Fund is delayed or prevented from exercising its rights to dispose of the collateral securities, including the risk of a possible decline in the fair value of the underlying securities during the period while the Fund seeks to assert its rights.

Allocations:

     Expenses directly attributable to a Fund are charged to that Fund. Expenses not directly attributable to a Fund are allocated proportionately among the applicable series within the Trusts in relation to the net assets of each fund or on another reasonable basis. Class specific expenses are charged directly to the class incurring the expense. In addition, income, expenses (other than class specific expenses), and unrealized and realized gains and losses are allocated to each class based on relative net assets on a daily basis.

Dividends to Shareholders:

     Dividends to shareholders from net investment income, if any, are declared daily and paid monthly from each Fund. Dividends from net realized gains, if any, are declared and paid at least annually by the Funds. Additional distributions are also made to the Funds’ shareholders to the extent necessary to avoid the federal excise tax on certain undistributed income and net realized gains of regulated investment companies.

     The amount and character of net investment income and net realized gain distributions are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax’’ differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature (e.g., reclassification of market discounts, certain gain/loss, paydowns, and distributions), such amounts are reclassified within the composition of net assets based on their federal tax-basis treatment; temporary differences (e.g., wash losses and post-October loss deferrals) do not require reclassification. To the extent distributions to shareholders from net investment income and net realized gains exceed net investment income and net realized gains for tax purposes, they are reported as distributions of capital.

Federal Income Taxes:

     Each Fund is a separate taxable entity for federal income tax purposes. Each Fund has qualified and intends to continue to qualify each year as a “regulated investment company’’ under Subchapter M of the Internal Revenue Code, as amended, and to distribute substantially all of its taxable net investment income and net realized gains, if any, to its shareholders. Accordingly, no provision for federal income or excise tax is required.

     Management of the Funds has reviewed tax positions taken in tax years that remain subject to examination by all major tax jurisdictions, including federal (i.e., the last four tax year ends and the interim tax period since then, as applicable). Management believes that there is no tax liability resulting from unrecognized tax benefits related to uncertain tax positions taken.

30       HSBC FAMILY OF FUNDS

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Notes to Financial Statements—as of October 31, 2013 (continued)

New Accounting Pronouncements:

     In January 2013, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2013-01 “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities” (“ASU 2013-01”), which amended Accounting Standards Codification Subtopic 210-20, Balance Sheet Offsetting. ASU 2013-01 clarified the scope of ASU No. 2011-11 “Disclosures about Offsetting Assets and Liabilities” (“ASU 2011-11”). ASU 2011-11 requires an entity to disclose information about offsetting and related arrangements to enable users of the financial statements to understand the effect of those arrangements on the entity’s financial position. ASU 2013-01 clarifies the scope of ASU 2011-11 as applying to derivatives accounted for in accordance with Topic 815, Derivatives and Hedging, including bifurcated embedded derivatives, repurchase agreements and reverse repurchase agreements, and securities borrowing and securities lending transactions that are offset either in accordance with other requirements of GAAP or subject to an enforceable master netting arrangement or similar agreement. The guidance in ASU 2013-01 and ASU 2011-11 is effective for interim and annual periods beginning on or after January 1, 2013. Management is evaluating any impact ASU 2013-01 and ASU 2011-11 may have on the Funds’ financial statements.

3. Investment Valuation Summary:

     The valuation techniques employed by the Funds, as described below, maximize the use of observable inputs and minimize the use of unobservable inputs in determining fair value. The inputs used for valuing the Funds’ investments are summarized in the three broad levels listed below:

• Level 1: quoted prices in active markets for identical assets
   
• Level 2: other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.)
   
• Level 3: significant unobservable inputs (including a Fund’s own assumptions in determining the fair value of investments)

     Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The Funds determine transfers between fair value hierarchy levels at the reporting period end. The inputs or methodology used for valuing investments are not necessarily an indication of the risk associated with investing in those investments.

     Investments of the Funds are valued using the amortized cost method pursuant to Rule 2a-7 under the Act, which approximates fair value and are typically categorized as Level 2 in the fair value hierarchy. The amortized cost method involves valuing an instrument at its cost initially and thereafter assuming a constant amortization to maturity of any discounts or premium, regardless of the impact of fluctuating interest rates on the market value of the instrument. The amortized cost method may result in periods during which value, as determined by amortized cost, is higher or lower than the price a Fund holding the instrument would receive if it sold the instrument. The fair value of securities in the Funds can be expected to vary with changes in prevailing interest rates.

     Investments in other money market funds are priced at net asset value as reported by such companies and are typically categorized as Level 1 in the fair value hierarchy.

     Repurchase agreements are valued at original cost and are typically categorized as Level 2 in the fair value hierarchy.

     For the year ended October 31, 2013, there were no Level 3 investments for which significant unobservable inputs were used to determine fair value.

HSBC FAMILY OF FUNDS       31

HSBC FAMILY OF FUNDS

Notes to Financial Statements—as of October 31, 2013 (continued)

     The following is a summary of the valuation inputs used as of October 31, 2013 in valuing the Funds’ investments based upon the three levels defined above. The breakdown of investment categorization is disclosed in the Schedule of Portfolio Investments for each Fund:

	LEVEL 1($)		LEVEL 2($)	LEVEL 3($)		Total($)
Prime Money Market Fund
Investment Securities:
Certificates of Deposit		—	1,976,782,448		—	1,976,782,448
Commercial Paper and Notes		—	1,353,212,261		—	1,353,212,261
Corporate Obligations		—	181,565,143		—	181,565,143
Yankee Dollars		—	194,243,024		—	194,243,024
U.S. Government and Government
Agency Obligations		—	30,000,000		—	30,000,000
U.S. Treasury Obligations		—	688,239,294		—	688,239,294
Time Deposits		—	250,000,000		—	250,000,000
Total Investment Securities		—	4,674,042,170		—	4,674,042,170
U.S. Government Money Market Fund
Investment Securities:
U.S. Government and Government
Agency Obligations		—	703,438,583		—	703,438,583
U.S. Treasury Obligations		—	2,421,383,138		—	2,421,383,138
Repurchase Agreements		—	1,100,000,000		—	1,100,000,000
Total Investment Securities		—	4,224,821,721		—	4,224,821,721
U.S. Treasury Money Market Fund
Investment Securities:
U.S. Treasury Obligations		—	2,560,376,219		—	2,560,376,219
Total Investment Securities		—	2,560,376,219		—	2,560,376,219

4. Related Party Transactions and Other Agreements and Plans:

Investment Management:

     HSBC Global Asset Management (USA) Inc. (“HSBC’’ or the “Investment Adviser’’), a wholly owned subsidiary of HSBC Bank USA, N.A., a national bank organized under the laws of the United States, acts as Investment Adviser to the Funds. As Investment Adviser, HSBC manages the investments of the Funds and continuously reviews, supervises and administers the Funds’ investments pursuant to an Investment Advisory Contract. For its services as investment adviser, HSBC receives a fee from each Fund, accrued daily and paid monthly, based on the average daily net assets of each respective Fund, at an annual rate of 0.10%.

32       HSBC FAMILY OF FUNDS

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Notes to Financial Statements—as of October 31, 2013 (continued)

     HSBC also provides operational support services to the Funds pursuant to an Operational Support Services Agreement. For its services in this capacity, HSBC receives a fee, accrued daily and paid monthly, based on the average daily net assets of Class A Shares, Class B Shares, Class C Shares, Class D Shares and Class Y Shares, at an annual rate of:

Fund	Fee Rate(%)
Prime Money Market Fund	0.10
U.S. Government Money Market Fund	0.10
U.S. Treasury Money Market Fund	0.10

     The Bank of New York Mellon (the “Servicer”) provides recordkeeping, reporting and processing services to the Prime Money Market Fund, U.S. Government Money Market Fund and U.S. Treasury Money Market Fund, Class I Shares. The Servicer is paid by the Investment Adviser from its profits and not by the Funds, for these services.

Administration:

     HSBC also serves the Funds as Administrator. Under the terms of the Administration Agreement, HSBC receives from the Funds (as well as other funds in the Trusts combined) a fee, accrued daily and paid monthly, at an annual rate of:

Based on Combined Average Daily Net Assets of	Fee Rate(%)
Up to $10 billion	0.0550
In excess of $10 billion but not exceeding $20 billion	0.0350
In excess of $20 billion but not exceeding $50 billion	0.0275
In excess of $50 billion	0.0250

     The fee rates and breakpoints are determined on the basis of the aggregate average daily net assets of the Trusts. The total administration fee paid to HSBC is allocated to each series based upon its proportionate share of the aggregate net assets of the Trusts, subject to certain allocations in cases where one fund invests some or all of its assets in another fund. An amount equal to 50% of the administration fee is deemed to be class specific.

     Pursuant to a Sub-Administration Agreement with HSBC, Citi Fund Services Ohio, Inc. (“Citi’’), a wholly-owned subsidiary of Citigroup, Inc., serves as the Trusts’ Sub-Administrator, subject to the general supervision by the Trusts’ Board and HSBC. For these services, Citi is entitled to a fee, payable by HSBC, at an annual rate equivalent to the fee rates set forth above subject to certain reductions associated with services provided to new funds, minus 0.02% which is retained by HSBC. During the year ended October 31, 2013, Citi voluntarily reduced its sub-administration fees by $217,136.

     Under a Compliance Services Agreement between the Trusts and Citi (the “CCO Agreement’’), Citi makes an employee available to serve as the Trusts’ Chief Compliance Officer (the “CCO’’). Under the CCO Agreement, Citi also provides infrastructure and support in implementing the written policies and procedures comprising the Trusts’ compliance program, including support services to the CCO. For the services provided under the CCO Agreement, the Trusts paid Citi $287,560 for the year ended October 31, 2013, plus reimbursement of certain out of pocket expenses. Expenses incurred by each Fund are reflected on the Statements of Operations as “Compliance Services.’’ Citi pays the salary and other compensation earned by individuals performing these services, as employees of Citi.

Distribution Arrangements:

     Foreside Distribution Services, L.P. (“Foreside’’), a wholly-owned subsidiary of Foreside Financial Group LLC, serves the Trust as Distributor (the “Distributor’’). The Trust has adopted a non-compensatory Distribution Plan and Agreement (the “Distribution Plan’’) pursuant to Rule 12b-1 of the Act. The Distribution Plan provides for reimbursement of expenses incurred by the Distributor related to distribution and marketing, at a rate not to exceed 0.25%, 1.00%, 1.00% and 0.25% of the average daily net assets of Class A Shares (currently not being charged), Class B Shares (currently charging 0.75%), Class C Shares (currently charging 0.75%) and

HSBC FAMILY OF FUNDS       33

HSBC FAMILY OF FUNDS

Notes to Financial Statements—as of October 31, 2013 (continued)

Class D Shares (currently not being charged) of the Funds, respectively. For the year ended October 31, 2013, Foreside, as Distributor, also received $213,520, $105,439, and $49,940 in commissions from sales of the Trusts, for Class A Shares, Class B Shares, and Class C Shares, respectively of which $584, $89, and $0 were reallocated to HSBC-affiliated brokers and dealers, for Class A Shares, Class B Shares, and Class C Shares, respectively. Expenses reduced during the year ended October 31, 2013 are reflected on the Statements of Operations as “Fees voluntarily reduced by Distributor.’’

Shareholder Servicing:

     The Trust has adopted a Shareholder Services Plan, which provides for payments to shareholder servicing agents (which primarily consist of HSBC and its affiliates) for providing various shareholder services. For performing these services, the shareholder servicing agents receive a fee that is computed daily and paid monthly up to 0.60%, 0.25%, 0.25%, 0.25% and 0.10% of the average daily net assets of Class A Shares (currently charging 0.40%), Class B Shares, Class C Shares, Class D Shares and Class E Shares (expected to charge 0.05%) of the Funds, respectively. The aggregate fees paid to the Distributor pursuant to the Distribution Plan and to shareholder servicing agents pursuant to the Shareholder Services Plan may not exceed, in the aggregate, 0.85%, 1.00%, 1.00%, 0.50% and 0.10% annually of each Fund’s average daily net assets of Class A Shares, Class B Shares, Class C Shares, Class D Shares and Class E Shares, respectively. Expenses reduced during the year ended October 31, 2013 are reflected on the Statements of Operations as “Fees voluntarily reduced by Shareholder Servicing Agent.’’

Fund Accounting and Transfer Agency:

     Citi provides fund accounting and transfer agency services for each Fund. As transfer agent, Citi receives a fee based on the number of funds and shareholder accounts, subject to certain minimums, reductions associated with services provided to new funds and reimbursement of certain expenses. As fund accountant, Citi receives an annual fee per Fund and share class, subject to minimums, reductions associated with services provided to new funds and reimbursement of certain expenses. Citi receives additional fees paid by the Trust for blue sky exemption services and money market fund reporting services.

Independent Trustees:

     The Trusts pay each Independent Trustee an annual retainer of $100,000. The Trusts pay a fee of $10,000 for each regular meeting of the Board attended and a fee of $ 3,000 for each special meeting attended. The Trusts pay each Committee Chair an annual retainer of $ 3,000, with the exception of the Chair of the Audit Committee, who receives a retainer of $ 6,000. The Trusts also pay the Chairman of the Board, an additional annual retainer of $24,000. In addition, for time expended on Board duties outside normal meetings, which is authorized by the Board, a Trustee is compensated at the rate of $ 500 per hour, up to a maximum of $ 3,000 per day.

Fee Reductions:

     The Investment Adviser has agreed to contractually limit through March 1, 2014 the annual total expenses, exclusive of interest, taxes, brokerage commissions, and extraordinary expenses, of certain classes of the Funds. Each affected Fund Class has its own expense limitations based on the average daily net assets for any full fiscal year as follows:

		Contractual
		Expense
Fund	Class	Limitations(%)
Prime Money Market Fund	E		0.25	*
Prime Money Market Fund	I		0.20
U.S. Government Money Market Fund	E		0.25	*
U.S. Government Money Market Fund	I		0.20
U.S. Treasury Money Market Fund	E		0.25	*
U.S. Treasury Money Market Fund	I		0.20
____________________
* As of October 31, 2013, Class E Shares were not operational.

34       HSBC FAMILY OF FUNDS

HSBC FAMILY OF FUNDS

Notes to Financial Statements—as of October 31, 2013 (continued)

     Any amounts contractually waived or reimbursed by the Investment Adviser will be subject to repayment by the respective Fund to the Investment Adviser within three years to the extent that the repayment will not cause the Fund’s operating expenses to exceed the contractual expense limit that was in effect at the time of such waiver or reimbursement. At October 31, 2013, there were no remaining contractual reimbursements that are subject to repayment by the Funds in subsequent years.

     The Administrator and Citi may voluntarily waive/reimburse fees to help support the expense limits of the Funds. In addition, HSBC, in its role as Investment Adviser and Administrator, may waive/reimburse additional fees at its discretion. Any voluntary fee waivers/reimbursements are not subject to recoupment in subsequent fiscal periods. Voluntary waivers/reimbursements may be stopped at any time. Amounts waived/reimbursed by the Investment Adviser, Administrator and Citi are reported separately on the Statements of Operations, as applicable.

     The Funds have entered into an arrangement with their custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Funds’ custodian expenses. Expenses reduced during the year ended October 31, 2013 are reflected on the Statements of Operations as “Fees paid indirectly,” as applicable.

5. Federal Income Tax Information:

     At October 31, 2013, the cost basis of securities for federal income tax purposes, gross unrealized appreciation, gross unrealized depreciation and net unrealized appreciation/depreciation were as follows:

					Net Unrealized
		Tax Unrealized	Tax Unrealized		Appreciation/
	Tax Cost ($)	Appreciation ($)	Depreciation ($)		(Depreciation) ($)
Prime Money Market Fund	4,674,044,583	—	(2,413	)	(2,413	)
U.S. Government Money Market Fund	4,224,870,236	—	(48,515	)	(48,515	)
U.S Treasury Money Market Fund	2,560,404,902	—	(28,683	)	(28,683	)

     The tax character of dividends paid by the Funds as of the tax year ended October 31, 2013 was as follows:

	Dividends paid from
		Net
		Long Term	Total	Tax	Total
	Ordinary	Capital	Taxable	Exempt	Dividends
	Income($)	Gains($)	Dividends($)	Distributions($)	Paid($)(1)
Prime Money Market Fund	2,947,993	148	2,948,141	—	2,948,141
U.S. Government Money Market Fund	619,866	—	619,866	—	619,866

     The tax character of dividends paid by the Funds as of the tax year ended October 31, 2012 was as follows:

	Dividends paid from
		Net
		Long Term	Total	Tax	Total
	Ordinary	Capital	Taxable	Exempt	Dividends
	Income($)	Gains($)	Dividends($)	Distributions($)	Paid($)(1)
Prime Money Market Fund	5,507,290	—	5,507,290	—	5,507,290
U.S. Government Money Market Fund	584,227	—	584,227	—	584,227
U.S. Treasury Money Market Fund	24,266	—	24,266	—	24,266

____________________
(1)	Total dividends paid may differ from the amount reported in the Statement of Changes in Net Assets because dividends are recognized when actually paid for tax purposes.

HSBC FAMILY OF FUNDS       35

HSBC FAMILY OF FUNDS

Notes to Financial Statements—as of October 31, 2013 (continued)

     As of the tax year ended October 31, 2013, the components of accumulated earnings/(deficit) on a tax basis for the Funds were as follows:

										Accumulated						Total
	Undistributed		Undistributed	Undistributed						Capital			Unrealized			Accumulated
	Ordinary		Tax Exempt	Long Term	Accumulated		Dividends			and Other			Appreciation/			Earnings/
	Income($)		Income($)	Capital Gains($)	Earnings($)		Payable($)			Losses($)			(Depreciation)($)			(Deficit)($)
Prime Money Market Fund		108,880	—	—		108,880		(97,723	)		—			(2,413	)		8,744
U.S. Government Money
Market Fund		39,714	—	—		39,714		(39,714	)		(41,909	)		(48,515	)		(90,424	)
U.S. Treasury Money
Market Fund		—	—	—		—		—			(20,716	)		(28,683	)		(49,399	)

     As of the tax year ended October 31, 2013, the Funds have net capital loss carryforwards (“CLCFs”) as summarized in the tables below. CLCFs subjectto expiration are applied as short-term capital loss regardless of whether the originating capital loss was short-term or long-term. CLCFs that are not subject to expiration must be utilized before those that are subject to expiration. The Board does not intend to authorize a distribution of any realized gain for the Funds until any applicable CLCF has been offset or expires.

     CLCFs not subject to expiration:

	Short Term		Long Term
	Amount($)		Amount($)		Total($)
U.S. Government Money Market Fund		41,909		—	41,909
U.S. Treasury Money Market Fund		9,306		11,410	20,716

6. Legal and Regulatory Matters:

     On September 26, 2006 BISYS Fund Services, Inc. (“BISYS’’), an affiliate of BISYS Fund Services Ohio, Inc. which provided various services to the Funds, reached a settlement with the Securities and Exchange Commission (the “SEC’’) regarding the SEC’s investigation related to BISYS’ past payment of certain marketing and other expenses with respect to certain of its mutual fund clients. The related settlement monies were received by the Funds during the year ended October 31, 2010. The corresponding impact to the net income ratio and total return for the year ended October 31, 2010 are disclosed in the Funds’ Financial Highlights.

7. Subsequent Events:

     Management has evaluated events and transactions through the date the financial statements were issued, for purposes of recognition or disclosure in these financial statements and there are no subsequent events to report.

36       HSBC FAMILY OF FUNDS

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Trustees of
HSBC Funds:

We have audited the accompanying statements of assets and liabilities of HSBC Prime Money Market Fund, HSBC U.S. Government Money Market Fund and HSBC U.S. Treasury Money Market Fund (the Funds), including the schedules of portfolio investments, as of October 31, 2013, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period then ended. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the auditto obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of October 31, 2013, by correspondence with custodians and brokers or by other appropriate auditing procedures. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Funds as of October 31, 2013, the results of their operations for the year then ended, the changes in their net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period then ended, in conformity with U.S. generally accepted accounting principles.

Columbus, Ohio
December 27, 2013

HSBC FAMILY OF FUNDS       37

HSBC FAMILY OF FUNDS

Other Federal Income Tax Information—as of October 31, 2013 (Unaudited)

     During the year ended October 31, 2013, the following Fund declared capital gain distributions:

	Short Term Capital Gain	Long Term Capital Gain
	Distributions ($)	Distributions ($)
Prime Money Market Fund	11,299	148

     During the year ended October 31, 2013, the following Fund designated the maximum amount allowable as interest-related dividends for certain non-U.S. resident investors:

	Qualified Interest Income (%)
Prime Money Market Fund	100.00
U.S. Government Money Market Fund	100.00

38       HSBC FAMILY OF FUNDS

HSBC FAMILY OF FUNDS

Table of Shareholder Expenses—as of October 31, 2013 (Unaudited)

     As a shareholder of the Funds, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, redemption fees and exchange fees; and (2) ongoing costs, including management fees, distribution fees and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare the cost with the ongoing costs of investing in other mutual funds.

     These examples are based on an investment of $1,000 invested at the beginning of the period and held for the entire period from May 1, 2013 through October 31, 2013 (unless otherwise noted).

Actual Example

     The table below provides information about actual account values and actual expenses. You may use the information below, 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 table under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

					Annualized
		Beginning	Ending	Expenses Paid	Expense Ratio
		Account Value	Account Value	During Period*	During Period
		5/1/13	10/31/13	5/1/13 - 10/31/13	5/1/13 - 10/31/13
Prime Money Market Fund	Class A Shares	1,000.00	1,000.00	1.06	0.21%
	Class B Shares	1,000.00	1,000.10	1.01	0.20%
	Class C Shares	1,000.00	1,000.00	0.76	0.15%
	Class D Shares	1,000.00	1,000.00	1.01	0.20%
	Class I Shares	1,000.00	1,000.20	0.86	0.17%
	Class Y Shares	1,000.00	1,000.00	1.06	0.21%
U.S. Government Money
Market Fund	Class A Shares	1,000.00	1,000.10	0.50	0.10%
	Class B Shares	1,000.00	1,000.00	0.50	0.10%
	Class D Shares	1,000.00	1,000.10	0.50	0.10%
	Class I Shares	1,000.00	1,000.10	0.45	0.09%
	Class Y Shares	1,000.00	1,000.10	0.50	0.10%
U.S. Treasury Money
Market Fund	Class A Shares	1,000.00	1,000.00	0.40	0.08%
	Class B Shares**	1,000.00	1,000.00	0.06	0.03%
	Class D Shares	1,000.00	1,000.00	0.35	0.07%
	Class I Shares	1,000.00	1,000.00	0.35	0.07%
	Class Y Shares	1,000.00	1,000.00	0.35	0.07%

____________________
 

*	Expenses are equal to the average account value over the period, multiplied by the Fund’s annualized expense ratio, multiplied by 184/365 (to reflect the one half year period).
**	Information shown reflects values using the expense ratio and rate of return for the period May 1, 2013 to July 7, 2013 (number of operational days in period).

HSBC FAMILY OF FUNDS       39

HSBC FAMILY OF FUNDS

Table of Shareholder Expenses—as of October 31, 2013 (Unaudited) (continued)

Hypothetical Example for Comparison Purposes

     The table below provides information about hypothetical account values and hypothetical expenses based on each 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 this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

     Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

					Annualized
		Beginning	Ending	Expenses Paid	Expense Ratio
		Account Value	Account Value	During Period*	During Period
		5/1/13	10/31/13	5/1/13 - 10/31/13	5/1/13 - 10/31/13
Prime Money Market Fund	Class A Shares	1,000.00	1,024.15	1.07	0.21%
	Class B Shares	1,000.00	1,024.20	1.02	0.20%
	Class C Shares	1,000.00	1,024.45	0.77	0.15%
	Class D Shares	1,000.00	1,024.20	1.02	0.20%
	Class I Shares	1,000.00	1,024.35	0.87	0.17%
	Class Y Shares	1,000.00	1,024.15	1.07	0.21%
U.S. Government Money
Market Fund	Class A Shares	1,000.00	1,024.70	0.51	0.10%
	Class B Shares	1,000.00	1,024.70	0.51	0.10%
	Class D Shares	1,000.00	1,024.70	0.51	0.10%
	Class I Shares	1,000.00	1,024.75	0.46	0.09%
	Class Y Shares	1,000.00	1,024.70	0.51	0.10%
U.S. Treasury Money
Market Fund	Class A Shares	1,000.00	1,024.80	0.41	0.08%
	Class B Shares**	1,000.00	1,009.26	0.06	0.03%
	Class D Shares	1,000.00	1,024.85	0.36	0.07%
	Class I Shares	1,000.00	1,024.85	0.36	0.07%
	Class Y Shares	1,000.00	1,024.85	0.36	0.07%

____________________
 

*	Expenses are equal to the average account value over the period, multiplied by the Fund’s annualized expense ratio, multiplied by 184/365 (to reflect the one half year period).
**	Information shown reflects values using the expense ratio for the period from May 1, 2013 to July 7, 2013 (number of operational days in period) and has been annualized to reflect values for the period May 1, 2013 to October 31, 2013.

40       HSBC FAMILY OF FUNDS

HSBC FAMILY OF FUNDS

Board of Trustees and Officers (Unaudited)

MANAGEMENT OF THE TRUST

     The following table contains information regarding the HSBC Family of Funds’ Board of Trustees (“Trustees”). Asterisks indicate those Trustees who are “interested persons,” as defined in the Investment Company Act of 1940, as amended, of the HSBC Family of Funds. The HSBC Family of Funds’ Statement of Additional Information includes additional information about the Trustees and is available, without charge, upon request by calling (888) 525-5757.

				Portfolios in
	Position(s)	Term of Office		Fund Complex	Other
Name,	Held with	and Length of	Principal Occupation(s)	Overseen By	Directorships
Address, Age	Funds	Time Served	During Past 5 Years	Trustee*	Held by Trustee
NON-INTERESTED
TRUSTEES
MARCIA L. BECK P.O. Box 182845 Columbus, OH 43218-3035 Age: 58	Trustee	Indefinite; 2008 to present	Private Investor (June 1999 – present); Executive Vice President, Prudential Investments (1997 – 1999); President and Trustee, The Goldman Sachs Mutual Funds (1992 – 1996)	21	None
SUSAN C. GAUSE P.O. Box 182845 Columbus, OH 43218-3035 Age: 60	Trustee	Indefinite; 2013 to present	Since 2003, Private Investor; Independent Trustee of Met Investors Series Trust (2008-2012); Chief Executive Officer, Dresdner RCM Global Investors and Allianz Dresdner Asset Management (2000-2002); Board Member of Dresdner Global Asset Management Board (2000-2002); Chief Operating Officer and Senior Managing Director of Dresdner RCM Global Investors (1998-2000)	21	Since 2012, Trustee, Metropolitan Series Fund
SUSAN S. HUANG P.O. Box 182845 Columbus, OH 43218-3035 Age: 59	Trustee	Indefinite; 2008 to present	Private Investor (2000- present); Senior Vice President, Schroder Investment Management (2001 – 2004); Managing Director, Chase Asset Management (1995-2000)	21	None
ALAN S. PARSOW P.O. Box 182845 Columbus, OH 43218-3035 Age: 63	Trustee	Indefinite; 1987 to present	General Partner, Elkhorn Partners, L.P. (a private investment partnership) (1989 – present)	21	None
THOMAS F. ROBARDS P.O. Box 182845 Columbus, OH 43218-3035 Age: 67	Trustee	Indefinite; 2005 to present	Partner, Robards & Co. LLC (investment and advisory services) (2005-present); Chief Financial Officer, American Museum of Natural History (2003- 2004); Chief Financial Officer, Datek Online Holdings (2000-2003); Previously EVP and CFO Republic New York Corporation	21	Overseas Shipholding Group (energy transportation); Ellington Financial LLC (NYSE listed financial services); Ellington Residential Mortgage REIT (NYSE listed real estate investment trust)
MICHAEL SEELY P.O. Box 182845 Columbus, OH 43218-3035 Age: 68	Chairman and Trustee	Indefinite; 1987 to present	Private Investor (2003-present); General Partner, Global Multi Manager Partners (1999-2003); President of Investor Access Corporation (1981-2003)	21	None
INTERESTED TRUSTEE
DEBORAH HAZELL 452 Fifth Avenue New York NY 10018 Age: 50	Trustee	Indefinite; 2011 to present	CEO, HSBC Global Asset Management (USA) Inc. (2011-present); President and CEO, Fisher Francis Trees & Watts (“FFTW”) (investment advisor), February 2008-June 2011; Head of Client Service, Business Development and Marketing Group, FFTW (October 1999-February 2008)	21	None

____________________
 

* Includes the Trust, the HSBC Advisor Fund Trust and the HSBC Portfolios.

HSBC FAMILY OF FUNDS       41

HSBC FAMILY OF FUNDS

Board of Trustees and Officers (Unaudited) (continued)

	Position(s) Held	Term of Office and	Principal Occupation(s)
Name, Address, Age	Funds	Length of Time Served	During Past 5 Years
OFFICERS
RICHARD A. FABIETTI 452 Fifth Avenue New York, NY 10018 Age: 55	President	One year; 2004 to present	Senior Vice President, Head of Product Management, HSBC Global Asset Management (USA) Inc. (1998 - present)
STEPHEN SIVILLO 452 Fifth Avenue New York, NY 10018 Age: 42	Vice President	One year; 2010 to present	Vice President of Product Administration, HSBC Global Asset Management (USA) Inc. (2010 - present); Chief Compliance Officer, Managers Funds (2009 – 2010); Director, Mutual Fund Compliance, AllianceBernstein (2007-2009)
TY EDWARDS* 3435 Stelzer Road Columbus, OH 43219-3035 Age: 47	Treasurer	One year; 2010 to present	Senior Vice President, Citi Fund Services (2010– present); Director, Product Management, Columbia Management (2007-2009); Deputy Treasurer, Columbia Funds, (2006-2007)
JENNIFER A. ENGLISH* 100 Summer Street Suite 1500 Boston, MA 02110 Age: 41	Secretary	One year; 2008 to present	Senior Vice President, Regulatory Administration, Citi (2005 - present)
FREDERICK J. SCHMIDT* 1 Rexcorp Plaza Uniondale, NY 11556 Age: 54	Chief Compliance Officer	One year; 2004 to present	Director and Chief Compliance Officer, CCO Services, Citi (2004 - present)

____________________
 

* Mr. Edwards, Mr. Schmidt, and Ms. English also are officers of other investment companies of which Citi (or an affiliate) is the administrator or sub-administrator.

42       HSBC FAMILY OF FUNDS

Other Information (Unaudited):

     Information regarding how the Funds voted proxies relating to portfolio securities during the most recent 12-month period ended June 30th is available (i) without charge, upon request, by calling 1-800-525-5757 for HSBC Bank USA and HSBC Brokerage (USA) Inc. clients and 1-800-782-8183 for all other shareholders; (ii) on the Funds’ website at www.investorfunds.us.hsbc.com; and (iii) on the Security and Exchange Commission’s (“Commission”) website at http://www.sec.gov.

The Funds file their complete schedules of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Funds’ Forms N-Q are available on the Commission’s website at http://www.sec.gov. The Funds’ Forms N-Q may be reviewed and copied at the Commission’s Public Reference Room in Washington, D.C. and information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. The Funds’ Schedules of Investments will be available no later than 60 days after each period end, without charge, on the Funds’ website at www.investorfunds.us.hsbc.com.

Each Fund will disclose on its website at www.investorfunds.us.hsbc.com, within five business days after the end of each month, a complete schedule of portfolio holdings and information regarding the weighted average maturity of the Fund. In addition, each Fund will file with the Commission on Form N-MFP, within five business days after the end of each month, more detailed portfolio holdings information. The Funds’ Forms N-MFP will be available on the Commission’s website at http://www.sec.gov, on a delayed basis, and the Funds’ website will also contain a link to these filings.

An investment in a Fund is not a deposit of HSBC Bank USA, National Association, and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency.

HSBC FAMILY OF FUNDS       43

HSBC FAMILY OF FUNDS: INVESTMENT ADVISER AND ADMINISTRATOR HSBC Global Asset Management (USA) Inc. 452 Fifth Avenue New York, NY 10018 SHAREHOLDER SERVICING AGENTS For HSBC Bank USA, N.A. and HSBC Securities (USA) Inc. Clients: HSBC Bank USA, N.A. 452 Fifth Avenue New York, NY 10018 1-888-525-5757 For All Other Shareholders: HSBC Funds P.O. Box 182845 Columbus, OH 43218 1-800-782-8183 TRANSFER AGENT Citi Fund Services 3435 Stelzer Road Columbus, OH 43219 DISTRIBUTOR Foreside Distribution Services, L.P. 690 Taylor Road, Suite 150 Gahanna, Ohio 43230

CUSTODIAN The Northern Trust Company 50 South LaSalle Street Chicago, IL 60603 INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM KPMG LLP 191 West Nationwide Blvd., Suite 500 Columbus, OH 43215 LEGAL COUNSEL Dechert LLP 1900 K Street, N.W. Washington, D.C. 20006

Investment products:

ARE NOT A BANK DEPOSIT OR OBLIGATION OF THE BANK OR ANY OF ITS AFFILIATES	ARE NOT FDIC INSURED	ARE NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY
ARE NOT GUARANTEED BY THE BANK OR ANY OF ITS AFFILIATES		MAY LOSE VALUE

Investment products are offered by HSBC Securities (USA) Inc. (HSI), member NYSE/FINRA/SIPC. HSI is an affiliate of HSBC Bank USA, N.A. Investment products: Are not a deposit or other obligation of the bank or any of its affiliates; Not FDIC insured or insured by any federal government agency of the United States; Not guaranteed by the bank or any of its affiliates; and are subject to investment risk, including possible loss of principal invested.

HSB-AR-MMF-1213 12/13

HSBC Global Asset Management (USA) Inc.

HSBC Funds
Annual Report
October 31, 2013

EMERGING MARKET FUNDS	Class A	Class I	Class S
HSBC Emerging Markets Debt Fund	HCGAX	HCGIX	HBESX
HSBC Emerging Markets Local Debt Fund	HBMAX	HBMIX	HBMSX
HSBC Frontier Markets Fund	HSFAX	HSFIX	—
HSBC Total Return Fund	HTRAX	HTRIX	HTRSX
HSBC RMB Fixed Income Fund	HRMBX	HRMRX	HRMSX

	Table of Contents
HSBC Family of Funds
Annual Report - October 31, 2013

Glossary of Terms
President’s Message	4
Commentary From the Investment Manager	5
Portfolio Reviews	6
Portfolio Composition	16
Schedules of Portfolio Investments
HSBC Emerging Markets Debt Fund	18
HSBC Emerging Markets Local Debt Fund	23
HSBC Frontier Markets Fund	27
HSBC Total Return Fund	29
HSBC RMB Fixed Income Fund	36
Statements of Assets and Liabilities	38
Statements of Operations	40
Statements of Changes in Net Assets	41
Financial Highlights	47
Notes to Financial Statements	52
Report of Independent Registered Public Accounting Firm	70
Other Federal Income Tax Information	71
Table of Shareholder Expenses	72
Board of Trustees and Officers	74
Other Information	76

Glossary of Terms

Barclays U.S. Aggregate Bond Index is an unmanaged index generally representative of investment-grade, USD-denominated, fixed-rate debt issues, taxable bond market, including Treasuries, government-related and corporate securities, asset-backed, mortgage-backed and commercial mortgage-backed securities, with maturities of at least one year.

Barclays U.S. Corporate High-Yield Bond Index is an unmanaged index that measures the non-investment grade, USD-denominated, fixed-rate, taxable corporate bond market. Securities are classified as high-yield if the middle rating of Moody’s, Fitch, and S&P is Ba1/BB+/BB+ or below. The index excludes emerging markets debt.

BofA Merrill Lynch 3-Month LIBOR Constant Maturity Index tracks the performance of a synthetic asset paying LIBOR to a stated maturity. The index is based on the assumed purchase at par of a synthetic instrument having exactly its stated maturity and with a coupon equal to that day’s fixing rate. That issue is assumed to be sold the following business day (priced at a yield equal to the current day fixing rate) and rolled into a new instrument.

Gross Domestic Product (“GDP”) measures the market value of the goods and services produced by labor and property in the United States.

HSBC Offshore Renminbi Bond Index tracks total return performance of renminbi-denominated and renminbi-settled bonds and certificates of deposit issued outside the People’s Republic of China.

J.P. Morgan Emerging Local Markets Index Plus is an unmanaged index that tracks total returns for local-currency-denominated money market instruments in 22 emerging markets countries with at least US$10 billion of external trade.

J.P. Morgan Emerging Markets Bond Index Global is an unmanaged index that tracks returns for USD-denominated debt instruments issued by emerging market sovereign and quasi-sovereign entities; Brady bonds, loans, Eurobonds and local market instruments.

J.P. Morgan Government Bond Index – Emerging Markets Global Diversified is an unmanaged comprehensive global emerging markets fixed income index, and consists of regularly traded, liquid fixed-rate, domestic currency government bonds to which international investors can gain exposure.

Morgan Stanley Capital International Europe Australasia and Far East (“MSCI EAFE”) Index is an unmanaged equity index which captures large and mid cap representation across Developed Markets countries: Australia, Austria, Belgium, Denmark, Finland, France, Germany, Greece, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland and the UK (excluding the US and Canada). With 910 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.

Morgan Stanley Capital International Emerging Market (“MSCI EM”) Index is an unmanaged index that captures large and mid cap representation across 21 Emerging Markets (EM) countries: Brazil, Chile, China, Colombia, Czech Republic, Egypt, Hungary, India, Indonesia, Korea, Malaysia, Mexico, Morocco, Peru, Philippines, Poland, Russia, South Africa, Taiwan, Thailand and Turkey. With 818 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.

Morgan Stanley Capital International (“MSCI”) Frontier Markets Index is an unmanaged index which captures large- and mid-cap representation across 25 Frontier Markets (FM) countries. The index includes 142 constituents, covering about 85% of the free float-adjusted market capitalization in each country.

Morgan Stanley Capital International (“MSCI”) Frontier Emerging Markets Capped Index is an unmanaged index and was developed for MSCI by HSBC and is a customized capped version of the MSCI Frontier Emerging Markets (FME) Index. The MSCI FME index is a free float-adjusted market capitalization index designed to measure equity market performance in all countries from the MSCI Frontier Markets Index and the lower size spectrum of the MSCI Emerging Markets Index. The Index consists of 25 frontier markets and five emerging markets.

Russell 2000^® Index is an unmanaged index that measures the performance of the small-cap segment of the U.S. equity universe. The Russell 2000^® Index is a subset of the Russell 3000^® Index representing approximately 10% of the total market capitalization of that index. It includes approximately 2000 of the smallest securities based on a combination of their market cap and current index membership.

Standard & Poor’s 500 (“S&P 500”) Index is an unmanaged index that is widely regarded as a gauge of the U.S. equities market. This index includes 500 leading companies in leading industries of the U.S. economy. The S&P 500 Index focuses on the large-cap segment of the market, with approximately 75% coverage of U.S. equities.

Securities indices assume reinvestment of all distributions and interest payments and do not take in account brokerage fees or expenses. Securities in the Funds do not match those in the indices and performance of the Funds will differ. Investors cannot invest directly in an index.

President’s Message

Dear Shareholder,

We are pleased to send to you the HSBC Funds annual report, covering the fiscal year ended October 31, 2013. This report contains detailed information about your Funds’ portfolio of investments and operating results. We encourage you to review it carefully.

This report includes commentary from the Funds’ portfolio managers in which they discuss the investment markets and their respective Fund’s performance. The portfolio manager commentary is accompanied by the Fund’s return for the period, listed alongside the returns of its benchmark index and peer group average for comparative purposes.

In closing, we would like to thank you for investing in the HSBC Funds. We continue to focus the HSBC Fund Family on investment solutions to assist our shareholders in reaching their financial goals. We appreciate the trust you place in us, and will continue working to earn it. Please contact us at any time with questions or concerns.

Sincerely,


Richard A. Fabietti
President

4       HSBC FAMILY OF FUNDS

	Commentary From the Investment Manager
HSBC Global Asset Management (USA) Inc.

U.S. Economic Review

Economic growth picked up pace in developing economies throughout the world during the 12-month period between November 1, 2012 and October 31, 2013. Many major economies, including the United States, reported improved economic data during the period, indicating new momentum for a modest but sustained recovery. The U.S. equity markets made strong gains during the period, boosted by improvements in the labor and housing markets and healthy corporate profits. Markets continued to benefit from the Federal Reserve Board’s (the “Fed”) decision to maintain the federal funds rate—a key factor in lending rates—at a historically low target range between 0.00% and 0.25%. Economic headwinds remained, however, including relatively high unemployment in some areas, low consumer spending and reduced government spending caused by sequestration.

Investor confidence declined mid-year due in part to expectations that the Fed would begin tapering its bond purchasing program. Concerns about the impact of tapering diminished, however, when the Fed announced in September that it would delay winding down its stimulus efforts until the unemployment rate fell significantly lower. The first shutdown of the U.S. government in 17 years occurred in October. This political crisis, along with the related standoff over raising the country’s borrowing limit, was another factor weighing on investor sentiment. The uncertainty surrounding the crisis dragged on equities, although markets regained momentum once a political deal was struck that reopened the government and raised the debt ceiling. Broad U.S. stock market indices ended the period significantly above where they were positioned 12 months earlier.

Improving political circumstances in the eurozone and positive economic data helped boost stocks in developed economies across the world. The economies of both Japan and Europe transitioned out of recession. Progress was made toward alleviating the sovereign debt crisis in Europe. The European Central Bank’s aggressive efforts, including its government bond-buying program known as Outright Monetary Transactions, reassured investors. Still, many developments in Europe revealed ongoing economic weaknesses, including a controversial bailout in Cyprus, political uncertainty in Italy and high unemployment throughout the eurozone.

Economic growth in many emerging markets slowed during the period, as concerns grew about rising inflation and potential decreases in global liquidity. In addition, signs of softening in China’s economy led to a fall in commodity prices, which dragged on stocks throughout emerging markets. Central banks in both India and Brazil fought rising inflation by raising interest rates.

The recovery of the U.S. housing market remained robust. New home sales and housing starts increased, though the pace of growth slowed late in the period. Although the unemployment rate gradually edged downward, it remained well above pre-recession levels. Moreover, the number of long-term unemployed individuals, including those who dropped out of the labor market entirely, remained high. Real income grew at a modest pace, but consumer spending remained weak, consumer confidence dropped sharply and personal savings rates slowed. Economic activity in the manufacturing sector expanded during the period, though the rate of growth slowed.

U.S. Gross Domestic Product¹ growth increased each quarter during the period, expanding at a rate of 0.1% during the fourth quarter of 2012 and quickening to a rate of 2.8% in the third quarter of 2013, according to preliminary estimates.

Market Review

The period began with U.S. markets retreating slightly due to the political face-off over the “fiscal cliff” and concerns about ongoing turmoil related to eurozone sovereign debt.

Equities then regained momentum in the first quarter of 2013 and began a steady rally that persisted through the duration of the period with only a few brief interruptions. The strong performance of equities was undeterred by uncertainty about government policy and concerns that the onset of automatic budget cuts—known as sequestration—would undermine economic growth. A political compromise that avoided the direst consequences of the fiscal cliff, along with improvement in the housing market, helped buoy investor confidence and fuel gains in the equity markets.

During the middle of the period equity prices fell as investors anticipated an imminent decrease in central bank liquidity. Stocks rebounded after the Fed delayed tapering its bond-purchasing program, with the S&P 500 Index¹ hitting a then-record high following the announcement. Equities ended the period in a rally that was spurred by the political deal that partially resolved the government shutdown and a second standoff over the debt ceiling.

Small- and mid-cap stocks outperformed large-cap stocks during the period, and emerging markets generally underperformed developed economies. The Russell 2000^® Index¹ of small-company stocks returned 36.28% and the MSCI Emerging Market Index¹ of emerging market stocks returned 6.90%.

Stocks in developed economies rose. Japanese equities performed well due to optimism regarding its central bank’s ambitious monetary easing schedule, which aimed to double the size of the monetary base over the next two years. International stocks made strong gains, slightly outperforming U.S. markets. The S&P 500 Index of large-company U.S. stocks returned 27.18% for the 12 months through October 2013. That compared to a 27.40% return for the MSCI EAFE Index¹ of international stocks in developed markets.

Rising interest rates, widening credit spreads and uncertainty about government policy resulted in weak performance in the U.S. fixed-income market during the period. Yields on U.S. Treasury bonds increased during the period, sending prices lower. Investment-grade corporate bonds also declined. Investors sought the more attractive yields offered by high-yield corporate bonds and high-yield municipal bonds, which were among the best-performing fixed-income sectors during the period. The Barclays U.S. Aggregate Bond Index¹, which tracks the broad investment-grade fixed-income market, returned -1.08% for the 12 months through October, while the Barclays U.S. Corporate High-Yield Bond Index¹ returned 8.87%. Fixed-income markets in Europe generated modest returns, while fixed-income in emerging markets ended the period significantly lower, despite a modest rebound in the final months of the period.

1       For additional information, please refer to the Glossary of Terms.

HSBC FAMILY OF FUNDS        5

Portfolio Reviews (Unaudited)

HSBC Emerging Markets Debt Fund
(Class A Shares, Class I Shares and Class S Shares)

by Guillermo Ossés, Managing Director, Head of Emerging Markets Debt Portfolio Management
Lisa Chua, CFA, Senior Vice President, Portfolio Manager
Binqi Liu, Vice President, Portfolio Manager
Phil Yuhn, Senior Vice President, Portfolio Engineer

The HSBC Emerging Markets Debt Fund (the “Fund”) seeks to maximize total return (comprised of capital appreciation and income). Under normal market conditions, the Fund invests at least 80% of its net assets in fixed income instruments of issuers that economically are tied to emerging markets. The Fund will invest in instruments issued by foreign governments and corporations. Investments will generally be made in U.S. dollar denominated instruments, but the Fund will also seek to invest in emerging market local currency denominated instruments.

Investment Concerns

Equity securities (stocks) are more volatile and carry more risk than other forms of investments, including investments in high-grade fixed income securities.

Bond funds will tend to experience smaller fluctuations in value than stock funds. However, investors in any bond fund should anticipate fluctuations in price, especially for longer term issues and in environments of rising interest rates. Investments in a bond fund are subject to possible loss due to the financial failure of underlying securities and their inability to meet their client obligations.

High yield, lower rated securities involve greater price volatility and present greater risk than higher rated fixed income securities. At times, due to market conditions, the Fund may be unable to sell certain of its portfolio securities without a substantial drop in price. Prices of fixed income securities are generally inversely correlated to interest rates. Investments in the Fund are subject to possible loss due to the financial failure of underlying securities and their inability to meet their debt obligations. These risks may increase the Fund’s share price volatility.

International investing involves increased risk and volatility. An investment in international funds entails the special risks of international investing, including currency exchange fluctuation, government regulations, and the potential for political and economic instability.

Prices of securities in emerging markets can fluctuate more significantly than the prices of companies in more developed countries. Securities of emerging market issuers generally have more risk than securities issued by issuers in more developed markets. The less developed the country, the greater affect the risks may have on an investment, and as a result, an investment may exhibit a higher degree of volatility than either the general domestic securities market or the securities markets of developed foreign countries.

Derivatives may be riskier than other types of investments and could result in losses that significantly exceed the Fund’s original investment.

For a complete description of these and other risks associated with investment in a mutual fund, please refer to the Fund’s prospectus.

Market Commentary

The Fund returned -2.84% (without sales charge) for the Class A Shares, -2.52% for the Class I Shares and -2.42% for the Class S Shares for the year ended October 31, 2013. That compared to a -2.58% total return for the Fund’s benchmark, the J.P. Morgan Emerging Markets Bond Index Global¹, for the same period.

Portfolio Performance

Emerging markets were volatile during the period as investors reacted to policy changes and political issues around the world. Investor confidence was strong early in 2013 due to the continued global economic recovery and positive developments such as the resolution of the “fiscal cliff” negotiations in the United States and the Bank of Japan’s announcement of a new stimulus policy. On the heels of this rally, the market was taken by surprise in May when U.S. payroll numbers came in stronger than expected and the U.S. Federal Reserve signaled a potential tapering of its quantitative easing program. This news resulted in a spike in U.S. Treasury yields and a repricing of fixed-income assets globally. Hardest hit were investment-grade sovereign emerging debt assets, which are more closely correlated to U.S. Treasuries than are other sectors of emerging market debt. However, emerging markets debt rallied in September and October, after the U.S. Federal Reserve said it would delay its tapering plan.

The Fund’s performance benefitted from a defensive position that we adopted early in the period because of what we believed were stretched asset valuations and a crowded technical position in emerging market debt. For example, underweight positions in investment-grade sovereigns such as Brazil, Russia and Indonesia contributed to relative performance when prices for those bonds fell.^†

Off-benchmark exposure to hard-currency corporate bonds also boosted the Fund’s relative return over the period. These corporate bonds outperformed sovereign debt, thanks to their shorter durations and lower sensitivity to U.S. Treasuries.^†

Our underweight position to certain high-yield countries such as Argentina hurt the Fund’s relative performance. We chose to underweight Argentina due to concerns surrounding the country’s deteriorating fundamentals of the country, however, its bond market rallied late in the period as investors grew confident about a pending court decision regarding the country’s debt payment obligations. The Fund benefited from the use of derivatives such as swap agreements and forward foreign currency exchange contracts. However, exposure to futures transactions reduced the Fund’s returns during the 12-month period.^†

†	Portfolio composition is subject to change.
1	For additional information, please refer to the Glossary of Terms.

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

6       HSBC FAMILY OF FUNDS

Portfolio Reviews (Unaudited)

HSBC Emerging Markets Debt Fund

The charts above represent a historical since inception performance comparison of a hypothetical $10,000 investment in the indicated share class versus a similar investment in the Fund’s benchmark and represents the reinvestment of dividends and capital gains in the Fund.

		Average Annual		Expense
Fund Performance		Total Return (%)		Ratio (%)2
	Inception	1	Since
As of October 31, 2013	Date	Year	Inception	Gross	Net
HSBC Emerging Markets Debt Fund Class A1	4/7/11	-7.46	5.09	1.63	1.20
HSBC Emerging Markets Debt Fund Class I	4/7/11	-2.52	7.47	1.28	0.85
HSBC Emerging Markets Debt Fund Class S	4/7/11	-2.42	7.57	1.18	0.75
J.P. Morgan Emerging Markets Bond Index Global	—	-2.58	7.47	N/A	N/A

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect the taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower. Currently, contractual fee waivers are in effect for the Fund through March 1, 2014.

1

Reflects the maximum sales charge of 4.75%.

2

Reflects the expense ratio as reported in the prospectus dated February 28, 2013. HSBC Global Asset Management (USA) Inc. has entered into a contractual expense limitation agreement with the Fund under which it will limit total expenses of the Fund (excluding interest, taxes, brokerage commissions, extraordinary expenses and estimated indirect expenses attributable to the Fund’s investments in investment companies) to an annual rate of 1.20%, 0.85% and 0.75% for Class A Shares, Class I Shares and Class S Shares, respectively. The expense limitation shall be in effect until March 1, 2014. Additional information pertaining to the October 31, 2013 expense ratios can be found in the financial highlights.

The Fund’s performance is measured against the J.P. Morgan Emerging Markets Bond Index Global, an unmanaged index that tracks returns for USD-denominated debt instruments issued by emerging market and sovereign quasi-sovereign entities; Brady bonds, loans, Eurobonds and local market markets. The performance of the index does not reflect the deduction of expenses associated with a mutual fund, such as investment management and fund accounting fees. The Fund’s performance reflects the deduction of fees for these value-added services. Investors cannot invest directly in an index.

HSBC FAMILY OF FUNDS       7

Portfolio Reviews (Unaudited)

HSBC Emerging Markets Local Debt Fund
(Class A Shares, Class I Shares and Class S Shares)

by Guillermo Ossés, Managing Director, Head of Emerging Markets Debt Portfolio Management
Lisa Chua, CFA, Senior Vice President, Portfolio Manager
Binqi Liu, Vice President, Portfolio Manager
Phil Yuhn, Senior Vice President, Portfolio Engineer

The HSBC Emerging Markets Local Debt Fund (the “Fund”) seeks maximum total return (comprised of capital appreciation and income). Under normal market conditions, the Fund invests at least 80% of its net assets, plus borrowings for investment purposes, in debt instruments issued by foreign governments, government agencies or corporations and denominated in local currencies of countries with emerging securities markets. The Fund may also invest in instruments denominated in U.S. dollars.

Investment Concerns

Equity securities (stocks) are more volatile and carry more risk than other forms of investments, including investments in high-grade fixed income securities.

Bond funds will tend to experience smaller fluctuations in value than stock funds. However, investors in any bond fund should anticipate fluctuations in price, especially for longer term issues and in environments of rising interest rates. Investments in a bond fund are subject to possible loss due to the financial failure of underlying securities and their inability to meet their client obligations.

High yield, lower rated securities involve greater price volatility and present greater risk than higher rated fixed income securities. At times, due to market conditions, the Fund may be unable to sell certain of its portfolio securities without a substantial drop in price. Prices of fixed income securities are generally inversely correlated to interest rates. Investments in the Fund are subject to possible loss due to the financial failure of underlying securities and their inability to meet their debt obligations. These risks may increase the Fund’s share price volatility.

International investing involves increased risk and volatility. An investment in international funds entails the special risks of international investing, including currency exchange fluctuation, government regulations, and the potential for political and economic instability.

Prices of securities in emerging markets can fluctuate more significantly than the prices of companies in more developed countries. Securities of emerging market issuers generally have more risk than securities issued by issuers in more developed markets. The less developed the country, the greater affect the risks may have on an investment, and as a result, an investment may exhibit a higher degree of volatility than either the general domestic securities market or the securities markets of developed foreign countries.

Derivatives may be riskier than other types of investments and could result in losses that significantly exceed the Fund’s original investment.

For a complete description of these and other risks associated with investment in a mutual fund, please refer to the Fund’s prospectus.

Market Commentary

The Fund returned -4.60% (without sales charge) for the Class A Shares, -4.25% for the Class I Shares and -4.16% for the Class S Shares for the year ended October 31, 2013. That compared to a -1.60% total return for the Fund’s primary performance benchmark, the J.P. Morgan Government Bond Index-Emerging Markets Global Diversified¹, for the same period.

Portfolio Performance

Emerging markets were volatile during the period as investors reacted to policy changes and political issues around the world. Investor confidence was strong early in 2013 due to the continued global economic recovery and positive developments such as the resolution of the “fiscal cliff” negotiations in the United States and the Bank of Japan’s announcement of a new stimulus policy. On the heels of this rally, the market was taken by surprise in May when U.S. payroll numbers came in stronger than expected and the U.S. Federal Reserve signaled a potential tapering of its quantitative easing program. This news resulted in a spike in U.S. Treasury yields and a repricing of fixed-income assets globally. Hardest hit were investment-grade sovereign emerging debt assets, which are more closely correlated to U.S. Treasuries than are other sectors of emerging market debt. However, emerging markets debt rallied in September and October, after the U.S. Federal Reserve said it would delay its tapering plan.

During the first half of the 12-month period, the Fund changed its benchmark from an equally weighted blend of the JP Morgan GBI-EM Global Diversified Index and the JP Morgan Emerging Local Markets Index Plus to only the JP Morgan GBI-EM Global Diversified Index. Transaction costs related to rebalancing the portfolio in response to this change detracted slightly from the Fund’s relative performance.

The Fund’s exposure to select locally denominated bonds hurt relative performance during the period. For example, an overweight position to longer-duration South African bonds detracted from the Fund’s performance when those assets underperformed shorter-duration bonds. The Fund also increased its position in local Polish bonds in May, which detracted from performance when that market experienced a sell-off in May and June.^†

An underweight position in the Hungarian forint also hurt performance, as currencies rallied late in the period when investors became more comfortable taking on more risk.^†

However, the Fund’s exposure to select emerging markets local currencies, which we achieved by holding forward currency exchange contracts, boosted relative performance during the period. Most significantly, the Fund benefited from its exposure to the Brazilian real, the Chinese renminbi and the South African rand when those currencies outperformed the U.S. dollar. Overweight positions in locally denominated bonds in Brazil and Mexico also improved the Fund’s relative performance.^†

The Fund also gained exposure to local interest rates during the period through the use of interest rate swaps. The use of these derivatives did not have a meaningful impact on performance during the period.^†

†	Portfolio composition is subject to change.
1	For additional information, please refer to the Glossary of Terms.

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

8       HSBC FAMILY OF FUNDS

Portfolio Reviews (Unaudited)

HSBC Emerging Markets Local Debt Fund

The charts above represent a historical since inception performance comparison of a hypothetical $10,000 investment in the indicated share class versus a similar investment in the Fund’s benchmark and represents the reinvestment of dividends and capital gains in the Fund.

		Average Annual		Expense
Fund Performance		Total Return (%)		Ratio (%)3
	Inception	1	Since
As of October 31, 2013	Date	Year	Inception	Gross	Net
HSBC Emerging Markets Local Debt Fund Class A1	4/7/11	-9.12	-3.33	2.11	1.34
HSBC Emerging Markets Local Debt Fund Class I	4/7/11	-4.25	-1.13	1.76	0.99
HSBC Emerging Markets Local Debt Fund Class S	4/7/11	-4.16	-1.04	1.66	0.89
Emerging Markets Debt Blend Portfolio Index2	—	-0.48	0.22	N/A	N/A
J.P. Morgan Government Bond Index–Emerging Markets Global Diversified2	—	-1.60	1.54	N/A	N/A
J.P. Morgan Emerging Local Markets Index Plus2	—	0.53	-1.17	N/A	N/A

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect the taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower. Currently, contractual fee waivers are in effect for the Fund through March 1, 2014.

1	Reflects the maximum sales charge of 4.75%.
2	For additional information, please refer to the Glossary of Terms.
3	Reflects the expense ratio as reported in the prospectus dated February 28, 2013. HSBC Global Asset Management (USA) Inc. has entered into a contractual expense limitation agreement with the Fund under which it will limit total expenses of the Fund (excluding interest, taxes, brokerage commissions, extraordinary expenses and estimated indirect expenses attributable to the Fund’s investments in investment companies) to an annual rate of 1.20%, 0.85% and 0.75% for Class A Shares, Class I Shares and Class S Shares, respectively. The expense limitation shall be in effect until March 1, 2014. The expense ratios reflected include Acquired Fund fees and expenses. Additional information pertaining to the October 31, 2013 expense ratios can be found in the financial highlights.

Effective December 26, 2012, the Fund no longer compares its performance to the Emerging Markets Debt Blend Portfolio Index. The Fund’s performance is now compared to the J.P. Morgan Government Bond Index-Emerging Markets Global Diversified Index. The Emerging Markets Debt Blend Portfolio Index consisted of a 50%/50% blend of the J.P. Morgan Government Bond Index-Emerging Markets Global Diversified Index and the J.P. Morgan Emerging Local Markets Index Plus. The Fund’s current benchmark, the J.P. Morgan Government Bond Index-Emerging Markets Global Diversified Index, is a comprehensive global emerging markets fixed income index consisting of regularly traded, liquid fixed-rate, domestic currency government bonds to which international investors can gain exposure. These indices are unmanaged and do not reflect the fees and expenses associated with a mutual fund. Investors cannot directly invest in an index.

HSBC FAMILY OF FUNDS       9

Portfolio Reviews (Unaudited)

HSBC Frontier Markets Fund
(Class A Shares and Class I Shares)

by Andrew Brudenell, Senior Portfolio Manager
Chris Turner, Portfolio Manager

The HSBC Frontier Markets Fund (the “Fund”) seeks long-term capital appreciation. Under normal market conditions, the Fund invests at least 80% of its net assets, plus any borrowings for investment purposes, in issuers located in “frontier market countries.” The term “frontier market countries” encompasses those countries that are at an earlier stage of economic, political or financial development, even by emerging markets standards.

Investment Concerns

Equity securities (stocks) are more volatile and carry more risk than other forms of investments, including investments in high-grade fixed income securities.

Foreign securities can be subject to greater risks than U.S. investments, including currency fluctuations, less liquid trading markets, greater price volatility, political and economic instability, less publicly available information, and changes in tax or currency laws or monetary policy. These risks are likely to be greater for emerging markets than in developed markets.

Frontier market countries generally have smaller economies and even less developed capital markets or legal and political systems than traditional emerging market countries. As a result, the risks of investing in emerging market countries are magnified in frontier market countries. The magnification of risks are the result of: the potential for extreme price volatility and illiquidity in frontier markets; government ownership or control of parts of private sector and of certain companies; trade barriers, exchange controls, managed adjustments in relative currency values and other protectionist measures imposed or negotiated by the countries with which frontier market countries trade; and the relatively new and unsettled securities laws in many frontier market countries.

Prices of securities in emerging markets can fluctuate more significantly than the prices of companies in more developed countries. Securities of emerging market issuers generally have more risk than securities issued by issuers in more developed markets. The less developed the country, the greater affect the risks may have on an investment, and as a result, an investment may exhibit a higher degree of volatility than either the general domestic securities market or the securities markets of developed foreign countries.

Derivatives may be riskier than other types of investments and could result in losses that significantly exceed the Fund’s original investment.

For a complete description of these and other risks associated with investment in a mutual fund, please refer to the Fund’s prospectus.

Market Commentary

The Fund returned 23.85% (without sales charge) for the Class A Shares and 24.25% for the Class I Shares for the year ended October 31, 2013. That compared to a 20.80% total return for the MSCI Frontier Emerging Markets Capped Index¹, the Fund’s primary performance benchmark, and a 26.02% total return for the MSCI Frontier Markets Index¹.

Portfolio Performance

Frontier markets performed well during the 12-month period, despite volatility in the global equity markets. Frontier equity markets outperformed both their larger emerging market peers and developed markets. A number of factors contributed to this outperformance; including strong performance from countries such as the United Arab Emirates (UAE) and Saudi Arabia, which benefited from a growing consumer base. General elections in Pakistan and a peaceful election in Kenya also boosted these countries’ equity markets, which contributed to the overall strong performance for frontier markets.

The largest contributor to the Fund’s relative outperformance of the benchmark was its exposure to the UAE. The country’s equity market benefited from an announcement in the summer that MSCI would upgrade the country to emerging market status in May 2014. The Fund’s overweight holdings of a bank, a medical facilities operator and real estate developer were notable beneficiaries of strong UAE market performance during period. Each company also benefited from positive fundamentals, including regularly beating market expectations.

The Fund also benefited from its investment in an off-benchmark Eastern European bank. The bank rebounded from poor performance at the end of 2012 in response to subsiding political fears in the region and improved financial forecasts. The Fund’s overweight position in Pakistan also made a positive contribution to the strategy. That performance was attributable to several factors, including strong corporate results, a finalized loan agreement with the IMF and an election that marked the first transition of power from one democratically elected government to another. Exposure to shares of a UAE-based hospital group, which held an initial public offering during the period, also benefited the Fund’s performance.^†

The Fund’s relative performance suffered due to an underweight exposure to Argentina held in response to what we saw as an unattractive regulatory and economic environment. Signs that the country’s political landscape may improve, based on voting trends in election primaries, pushed equity markets higher. A bumper soy bean crop also supported the country’s economic recovery, which further boosted the performance of Argentinian equities.^†

†	Portfolio composition is subject to change.
1	For additional information, please refer to the Glossary of Terms.

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

10       HSBC FAMILY OF FUNDS

Portfolio Reviews (Unaudited)

HSBC Frontier Markets Fund

The charts above represent a historical since inception performance comparison of a hypothetical $10,000 investment in the indicated share class versus a similar investment in the Fund’s benchmark and represents the reinvestment of dividends and capital gains in the Fund.

		Average Annual		Expense
Fund Performance		Total Return (%)		Ratio (%)3
	Inception		Since
As of October 31, 2013	Date	1 Year	Inception	Gross	Net
HSBC Frontier Markets Fund Class A1	9/6/11	17.61	12.38	3.17	2.23
HSBC Frontier Markets Fund Class I	9/6/11	24.254	15.52	2.82	1.88
MSCI Frontier Emerging Markets Capped Index2	—	20.80	11.24	N/A	N/A
MSCI Frontier Markets Index2	—	26.02	11.23	N/A	N/A

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect the taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower. Currently, contractual fee waivers are in effect for the Fund through March 1, 2014. Investments in an initial public offering during the current fiscal year ended October 31, 2013 has benefited the Fund’s overall performance by approximately 0.15%. This effect on performance is not typical and may not continue in the future.

1	Reflects the maximum sales charge of 5.00%.
2	For additional information, please refer to the Glossary of Terms.
3	Reflects the expense ratio as reported in the prospectus dated February 28, 2013. HSBC Global Asset Management (USA) Inc. has entered into a contractual expense limitation agreement with the Fund under which it will limit total expenses of the Fund (excluding interest, taxes, brokerage commissions, extraordinary expenses and estimated indirect expenses attributable to the Fund’s investments in investment companies) to an annual rate of 2.20% and 1.85% for Class A Shares and Class I Shares, respectively. The expense limitation shall be in effect until March 1, 2014. Additional information pertaining to the October 31, 2013 expense ratios can be found in the financial highlights.
4	The recent appreciation in the stock market has helped produce short-term returns that are not typical and may not continue in the future. Because of ongoing market volatility, Fund performance may be subject to substantial short-term changes.

The performance of the Fund is measured against the MSCI Frontier Markets Index and the MSCI Frontier Emerging Markets Capped Index. The Morgan Stanley Capital International (“MSCI”) Frontier Markets Index captures large- and mid-cap representation across 25 Frontier Markets (FM) countries. The index includes 142 constituents, covering about 85% of the free float-adjusted market capitalization in each country. The MSCI Frontier Emerging Markets Capped Index was developed for MSCI by HSBC and is a customized capped version of the MSCI Frontier Emerging Markets (FME) Index. The MSCI FME index is a free float-adjusted market capitalization index designed to measure equity market performance in all countries from the MSCI Frontier Markets Index and the lower size spectrum of the MSCI Emerging Markets Index. The Index consists of 25 frontier markets and five emerging markets. The indexes are unmanaged and the performance of the indexes does not reflect the deduction of expenses associated with a mutual fund, such as investment management and fund accounting fees. The Fund’s performance reflects the deduction of fees for these value-added services. Investors cannot invest directly in an index.

HSBC FAMILY OF FUNDS       11

Portfolio Reviews (Unaudited)

HSBC Total Return Fund
(Class A Shares, Class I Shares and Class S Shares)

by Guillermo Ossés, Managing Director, Head of Emerging Markets Debt Portfolio Management
Lisa Chua, CFA, Senior Vice President, Portfolio Manager
Binqi Liu, Vice President, Portfolio Manager
Phil Yuhn, Senior Vice President, Portfolio Engineer

The HSBC Total Fund (the “Fund”) seeks maximum total return (comprised of capital appreciation and income). Under normal market conditions, the Fund invests its assets (excluding U.S. cash and U.S. cash equivalents) primarily in instruments of issuers that are economically tied to emerging market countries, including in derivative instruments such as futures (including interest rate futures), forwards (including non-deliverable forwards), swaps (including interest rate and total return swaps), options (including interest rate options), swaptions and credit default swaps.

Investment Concerns

Equity securities (stocks) are more volatile and carry more risk than other forms of investments, including investments in high-grade fixed income securities.

Bond funds will tend to experience smaller fluctuations in value than stock funds. However, investors in any bond fund should anticipate fluctuations in price, especially for longer term issues and in environments of rising interest rates. Investments in a bond fund are subject to possible loss due to the financial failure of underlying securities and their inability to meet their client obligations.

High yield, lower rated securities involve greater price volatility and present greater risk than higher rated fixed income securities. At times, due to market conditions, the Fund may be unable to sell certain of its portfolio securities without a substantial drop in price. Prices of fixed income securities are generally inversely correlated to interest rates. Investments in the Fund are subject to possible loss due to the financial failure of underlying securities and their inability to meet their debt obligations. These risks may increase the Fund’s share price volatility.

International investing involves increased risk and volatility. An investment in international funds entails the special risks of international investing, including currency exchange fluctuation, government regulations, and the potential for political and economic instability.

Prices of securities in emerging markets can fluctuate more significantly than the prices of companies in more developed countries. Securities of emerging market issuers generally have more risk than securities issued by issuers in more developed markets. The less developed the country, the greater affect the risks may have on an investment, and as a result, an investment may exhibit a higher degree of volatility than either the general domestic securities market or the securities markets of developed foreign countries.

Derivatives may be riskier than other types of investments and could result in losses that significantly exceed the Fund’s original investment.

For a complete description of these and other risks associated with investment in a mutual fund, please refer to the Fund’s prospectus.

Market Commentary

The Fund returned -1.06% (without sales charge) for the Class A Shares, -0.66% for the Class I Shares and -0.57% for the Class S Shares for the year ended October 31, 2013. That compared to the 0.30% total return for the Funds benchmark, the BofA Merrill Lynch 3-Month LIBOR Constant Maturity Index¹, for the same period.

Portfolio Performance

Emerging markets were volatile during the period as investors reacted to policy changes and political issues around the world. Investor confidence was strong early in 2013, but the market was taken by surprise in May when the U.S. Federal Reserve signaled a potential tapering of its quantitative easing program. This news resulted in a spike in U.S. Treasury yields and a repricing of fixed-income assets globally. Hardest hit were investment-grade sovereign emerging debt assets, which are more closely correlated to U.S. Treasuries than are other sectors of emerging market debt. However, emerging markets debt rallied in September and October, after the U.S. Federal Reserve said it would delay its tapering plan.

Exposure to investment-grade sovereign debt detracted from the Fund’s performance during the period. The most significant impact came in May and June when investment-grade sovereigns and longer-dated bonds underperformed due to their higher sensitivity to the rise in U.S. Treasury yields and the subsequent sell-off in emerging markets assets. As a result, exposure to external debt from Brazil and Mexico detracted from the Fund’s performance during this time. The Fund’s short positions to the Hungarian forint and the euro also hurt performance when currencies rallied in September and October as investors became willing to take on more risk.^†

However, exposure to select emerging markets currencies, achieved through forward currency exchange contracts, helped returns during the period. We chose to increase exposure to the Brazilian real, the Mexican peso and the South African rand during May and June after valuations improved after the market correction related to the rise in U.S. Treasury yields. This positioning contributed to the Fund’s performance when emerging market currencies rallied late in the period.

The Fund held a short position to a credit default swap index as a hedge to protect the hard currency exposure from risks in high-yield countries such as Argentina, Venezuela and Ukraine, which had a higher probability of default. The Fund also gained exposure to local interest rates through the use of interest rate swaps.^†

The Fund benefited from exposure to derivatives such as swap agreements and futures transactions. However, the Fund’s performance suffered slightly from its use of options transactions during the period.^†

†	Portfolio composition is subject to change.
1	For additional information, please refer to the Glossary of Terms.

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

12       HSBC FAMILY OF FUNDS

Portfolio Reviews (Unaudited)

HSBC Total Return Fund

The charts above represent a historical since inception performance comparison of a hypothetical $10,000 investment in the indicated share class versus a similar investment in the Fund’s benchmark and represents the reinvestment of dividends and capital gains in the Fund.

		Average Annual			Expense
Fund Performance		Total Return (%)			Ratio (%)3
	Inception		Since
As of October 31, 2013	Date	1 Year	Inception		Gross	Net
HSBC Total Return Fund Class A1	3/30/12	-5.72		-1.49	1.57	1.57
HSBC Total Return Fund Class I	3/30/12	-0.66		1.96	1.22	1.22
HSBC Total Return Fund Class S	3/30/12	-0.57		2.05	1.12	1.12
BofA Merrill Lynch 3 Month LIBOR Constant Maturity Index2	—	0.30		0.38	N/A	N/A

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect the taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower.

1	Reflects the maximum sales charge of 4.75%.
2	For additional information, please refer to the Glossary of Terms.
3	Reflects the expense ratio as reported in the prospectus dated February 28, 2013. The expense ratios reflected include Acquired Fund fees and expenses. Additional information pertaining to the October 31, 2013 expense ratios can be found in the financial highlights.

The performance of the Fund is measured against the BofA Merrill Lynch 3-Month LIBOR Constant Maturity Index which tracks the performance of a synthetic asset paying LIBOR to a stated maturity. The index is based on the assumed purchase at par of a synthetic instrument having exactly its stated maturity and with a coupon equal to that day’s fixing rate. That issue is assumed to be sold the following business day (priced at a yield equal to the current day fixing rate) and rolled into a new instrument. The index is unmanaged and the performance of the index does not reflect the deduction of expenses associated with a mutual fund, such as investment management and fund accounting fees. The Fund’s performance reflects the deduction of fees for these value-added services. Investors cannot invest directly in an index.

HSBC FAMILY OF FUNDS       13

Portfolio Reviews (Unaudited)

HSBC RMB Fixed Income Fund
(Class A Shares, Class I Shares and Class S Shares)

by Cecilia Chan, Fixed Income CIO, Asia-Pacific
Jim Veneau, Investment Director, Asian Fixed Income
Alfred Mui, Investment Director, Asian Fixed Income
Gregory Suen, Associate Director, Fixed Income

The HSBC RMB Fixed Income Fund (the “Fund”) seeks to maximize total return by investing principally in debt instruments that provide exposure to Renminbi (“RMB”), the official currency of the People’s Republic of China (“China”). The Fund’s portfolio management team follows a top-down approach in which country credits, currencies, and local rate curves are analyzed based on their fundamental attractiveness. The team seeks to identify risk differentiation across issuers while attempting to manage credit, liquidity and interest rate risks. This investment process allows the team to capture potential opportunities in the growing offshore RMB fixed income market and take advantage of the currency’s potential appreciation. In order to gain such exposure, the Fund may invest in RMB-denominated debt instruments, including RMB-denominated deposits in Hong Kong or US dollar-denominated instruments, as well as derivative instruments, with underlying currency exposure to RMB.

Investment Concerns

Bond funds will tend to experience smaller fluctuations in value than stock funds. However, investors in any bond fund should anticipate fluctuations in price, especially for longer term issues and in environments of rising interest rates. Investments in a bond fund are subject to possible loss due to the financial failure of underlying securities and their inability to meet their client obligations.

High yield, lower rated securities involve greater price volatility and present greater risk than higher rated fixed income securities. At times, due to market conditions, the Fund may be unable to sell certain of its portfolio securities without a substantial drop in price. Prices of fixed income securities are generally inversely correlated to interest rates. Investments in the Fund are subject to possible loss due to the financial failure of underlying securities and their inability to meet their debt obligations. These risks may increase the Fund’s share price volatility.

International investing involves increased risk and volatility. An investment in international funds entails the special risks of international investing, including currency exchange fluctuation, government regulations, and the potential for political and economic instability.

Prices of securities in emerging markets can fluctuate more significantly than the prices of companies in more developed countries. Securities of emerging market issuers generally have more risk than securities issued by issuers in more developed markets. The less developed the country, the greater affect the risks may have on an investment, and as a result, an investment may exhibit a higher degree of volatility than either the general domestic securities market or the securities markets of developed foreign countries.

Derivatives may be riskier than other types of investments and could result in losses that significantly exceed the Fund’s original investment.

For a complete description of these and other risks associated with investment in a mutual fund, please refer to the Fund’s prospectus.

Market Commentary

The Fund returned 5.96% (without sales charge) for the Class A Shares and 6.31% for the Class I Shares for the year ended October 31, 2013. That compared to a 7.00% total return for the HSBC Offshore Renminbi Bond Index¹, the Fund’s primary performance benchmark, and a 0.53% total return for the J.P. Morgan Emerging Local Markets Index Plus¹.

Portfolio Performance

The market for offshore debt instruments denominated in the renminbi, the official currency of the People’s Republic of China, performed well during the period. Solid credit fundamentals and relatively short durations meant that the offshore RMB market was less affected by the volatility that struck other emerging markets during the summer of 2013. In addition the market benefited from the relative strength of the RMB against the U.S. dollar.

Early in the period we avoided investing in some of the longer-dated bonds in the market, because we felt that their higher yields did not justify taking on the additional risk that they represented. That positioning hurt the Fund’s performance relative to its primary benchmark due to the higher total yield that these bonds offered.^†

The Fund’s performance benefited from careful credit selection, particularly among bonds in the Hong Kong and Chinese property sectors, which we believed were undervalued. We also increased the Fund’s exposure to higher-yielding bonds during a period of relative market weakness in the summer of 2013. These investments boosted the Fund’s relative performance later in the period, when the market rallied strongly and higher-yielding bonds performed particularly well.^†

†	Portfolio composition is subject to change.
1	For additional information, please refer to the Glossary of Terms.

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

14       HSBC FAMILY OF FUNDS

Portfolio Reviews (Unaudited)

HSBC RMB Fixed Income Fund

The charts above represent a historical since inception performance comparison of a hypothetical $10,000 investment in the indicated share class versus a similar investment in the Fund’s benchmark and represents the reinvestment of dividends and capital gains in the Fund. The hypothetical performance for the HSBC Offshore Renminbi Bond Index was calculated based on 5/31/2012 as the inception date for the index.

		Average Annual		Expense
Fund Performance		Total Return (%)		Ratio (%)3
	Inception	1	Since
As of October 31, 2013	Date	Year	Inception	Gross	Net
HSBC RMB Fixed Income Class A1	6/8/12	0.93	2.97	2.54	1.45
HSBC RMB Fixed Income Class I	6/8/12	6.31	6.99	2.19	1.10
HSBC RMB Fixed Income Class S	6/8/12	6.41	7.09	2.09	1.00
HSBC Offshore Renminbi Bond Index2	—	7.00	7.85	N/A	N/A
J.P. Morgan Emerging Local Markets Index Plus2	—	0.53	3.93	N/A	N/A

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect the taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower. Currently, contractual fee waivers are in effect for the Fund through March 1, 2014.

1	Reflects the maximum sales charge of 4.75%.
2	For additional information, please refer to the Glossary of Terms.
3	Reflects the expense ratio as reported in the prospectus dated February 28, 2013. HSBC Global Asset management (USA) Inc. has entered into a contractual expense limitation agreement with the Fund under which it will limit total expenses of the Fund (excluding interest, taxes, brokerage commissions, extraordinary expenses and estimated indirect expenses attributable to the Fund’s investments in investment company companies) to an annual rate of 1.45%, 1.10% and 1.00% for Class A Shares, Class I Shares and Class S Shares. The expense limitation shall be in effect until March 1, 2014.

The performance of the Fund is measured against the HSBC Offshore Renminbi Bond Index and the J.P. Morgan Emerging Local Markets Index Plus. The HSBC Offshore Renminbi Bond Index tracks total return performance of renminbi-denominated and renminbi-settled bonds and certificates of deposit issued outside the People’s Republic of China. The J.P. Morgan Emerging Markets Bond Index Plus tracks total returns for local-currency-denominated money market instruments in 22 emerging markets countries with at least US$10 billion of external trade. The indexes are unmanaged and the performance of the indexes do not reflect the deduction of expenses associated with a mutual fund, such as investment management and fund accounting fees. The Fund’s performance reflects the deduction of fees for these value-added services. Investors cannot invest directly in an index.

HSBC FAMILY OF FUNDS       15

Portfolio Reviews

Portfolio Composition* (Unaudited)
October 31, 2013

HSBC Emerging Markets Debt Fund†
Country	Percentage of Investments at Value(%)
Russian Federation		12.9
Mexico		12.1
Turkey		11.2
Indonesia		10.4
Brazil		8.5
United States		5.6
Venezuela		5.1
South Africa		4.5
Colombia		4.4
Panama		3.5
Croatia		2.5
Peru		2.2
Poland		2.1
China		2.1
Philippines		1.7
Hungary		1.3
Chile		1.0
Lithuania		1.0
Kazakhstan		0.9
Uruguay		0.9
Romania		0.7
El Salvador		0.6
Iraq		0.5
Ireland (Republic of)		0.5
Nigeria		0.5
Namibia		0.5
Republic of Serbia		0.5
Sri Lanka		0.5
Slovenia		0.5
Paraguay		0.4
Malaysia		0.3
Lebanon		0.3
Dominican Republic		0.3
		100.0
HSBC Emerging Markets Local Debt Fund†
Country	Percentage of Investments at Value(%)
United States		23.6
Russian Federation		13.4
Thailand		11.1
Turkey		10.3
Brazil		10.0
Indonesia		7.6
Poland		4.9
Malaysia		4.7
Mexico		4.6
South Africa		3.4
Peru		3.1
Colombia		1.5
Luxembourg		1.1
China		0.7
		100.0
HSBC Frontier Markets Fund†
Country	Percentage of Investments at Value(%)
United Arab Emirates		13.7
Qatar		14.2
Nigeria		11.2
Pakistan		10.0
Saudi Arabia		8.2
Kuwait		6.5
Vietnam		4.0
Oman		3.9
Philippines		3.6
Colombia		2.7
Georgia		2.7
United States		2.7
Peru		2.6
Panama		2.1
Kazakhstan		1.8
Estonia		1.5
Romania		1.5
Sri Lanka		1.5
Turkmenistan		1.5
Egypt		1.2
Cambodia		1.1
Kenya		1.0
Croatia		0.6
Lebanon		0.2
Ukraine		0.0
		100.0
HSBC Total Return Fund†
Country	Percentage of Investments at Value(%)
United States		25.2
Mexico		12.9
Brazil		10.3
Colombia		10.1
Russian Federation		9.6
Turkey		7.7
Indonesia		5.2
South Africa		5.0
China		3.4
Peru		2.7
Kazakhstan		2.2
Chile		1.2
Croatia		1.0
Namibia		0.6
Panama		0.5
Slovenia		0.5
Iraq		0.4
Uruguay		0.3
India		0.2
Luxembourg		0.2
Costa Rica		0.2
Canada		0.2
Lithuania		0.2
Dominican Republic		0.1
Republic of Serbia		0.1
		100.0

16      HSBC FAMILY OF FUNDS

Portfolio Reviews

Portfolio Composition* (Unaudited) (continued)
October 31, 2013

HSBC RMB Fixed Income Fund†
Country	Percentage of Investments at Value(%)
China		38.6
Hong Kong		32.5
United States		6.0
Singapore		6.0
Japan		4.8
France		3.7
Australia		2.4
South Korea		2.4
Brazil		2.4
Germany		1.2
		100.0

____________________
 

*	Portfolio composition is subject to change.
†	Excludes any instruments used for cash management.

HSBC FAMILY OF FUNDS      17

HSBC EMERGING MARKETS DEBT FUND

Schedule of Portfolio Investments—as of October 31, 2013

Corporate Obligation – 0.0%
	Principal
	Amount ($)	Value ($)
Pemex Project Funding Master Trust,
6.63%, 6/15/35	10,000	10,850
TOTAL CORPORATE OBLIGATION
(COST $10,894)		10,850
Yankee Dollars – 94.7%
Brazil – 8.5%
Banco ABC Brasil SA,
7.88%, 4/8/20	100,000	104,000
Banco do Brasil SA, Registered,
5.88%, 1/26/22	450,000	452,700
Banco Nacional de Desenvolvimento
Economico e Social,
5.75%, 9/26/23 (a)	200,000	207,500
Banco Votorantim, Registered,
5.25%, 2/11/16, MTN	200,000	209,048
Caixa Economica Federal,
4.50%, 10/3/18 (a)	150,000	150,750
Federal Republic of Brazil,
2.63%, 1/5/23	600,000	535,500
Federal Republic of Brazil,
4.25%, 1/7/25	650,000	635,050
Federal Republic of Brazil,
7.13%, 1/20/37	540,000	648,000
Federal Republic of Brazil,
5.63%, 1/7/41	300,000	306,000
Petrobras International Finance Co.,
5.75%, 1/20/20	50,000	52,813
Vale Overseas Ltd.,
6.88%, 11/21/36	100,000	104,001
Votorantim Cimentos SA, Registered,
7.25%, 4/5/41	200,000	197,000
		3,602,362
Chile – 1.0%
CorpBanca SA, 3.13%, 1/15/18	200,000	188,337
Empresa Nacional de Petroleo,
Registered, 4.75%, 12/6/21	220,000	221,854
		410,191
China – 2.1%
CNOOC Curtis Funding No.1 Pty Ltd.,
4.50%, 10/3/23 (a)	200,000	203,166
Sinopec Capital (2013) Ltd.,
3.13%, 4/24/23 (a)	200,000	183,441
Sinopec Group Overseas Development
(2013) Ltd., 4.38%, 10/17/23 (a)	500,000	501,661
		888,268
Colombia – 4.4%
Bancolombia SA, 5.95%, 6/3/21	100,000	105,600
Grupo Aval Ltd., Registered,
4.75%, 9/26/22	200,000	187,750
Republic of Colombia,
4.38%, 7/12/21	490,000	518,910
Republic of Colombia, 2.63%, 3/15/23,
Callable 12/15/22 @ 100.00	200,000	180,900
Republic of Colombia,
4.00%, 2/26/24	200,000	199,500
Republic of Colombia,
8.13%, 5/21/24	300,000	397,500
Republic of Colombia,
6.13%, 1/18/41	250,000	283,125
		1,873,285
Croatia – 2.6%
Croatia, Registered,
6.75%, 11/5/19	500,000	545,000
Croatia, Registered,
6.63%, 7/14/20	100,000	108,000
Croatia, Registered,
6.38%, 3/24/21	400,000	424,500
		1,077,500
Dominican Republic – 0.3%
Dominican Republic,
7.50%, 5/6/21	100,000	110,650
El Salvador – 0.6%
Republic of El Salvador,
7.75%, 1/24/23	225,000	253,688
Hungary – 1.3%
Republic of Hungary,
6.38%, 3/29/21	130,000	141,213
Republic of Hungary,
5.38%, 2/21/23	300,000	298,815
Republic of Hungary,
7.63%, 3/29/41	80,000	90,100
		530,128
Indonesia – 10.4%
Majapahit Holding BV,
8.00%, 8/7/19	125,000	144,844
PT Pertamina (Persero) Tbk,
4.30%, 5/20/23 (a)	200,000	182,500
PT Pertamina Tbk, Registered,
4.88%, 5/3/22	400,000	385,000
Republic of Indonesia,
6.88%, 1/17/18	575,000	652,625
Republic of Indonesia,
3.38%, 4/15/23 (a)	350,000	315,000
Republic of Indonesia,
5.38%, 10/17/23 (a)	500,000	526,250
Republic of Indonesia, Registered,
5.88%, 3/13/20	1,150,000	1,259,250
Republic of Indonesia, Registered,
3.75%, 4/25/22	525,000	494,812
Republic of Indonesia, Registered,
8.50%, 10/12/35	100,000	129,500
Republic of Indonesia, Registered,
6.63%, 2/17/37	175,000	190,750
Republic of Indonesia, Registered,
7.75%, 1/17/38	100,000	121,875
		4,402,406

18       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC EMERGING MARKETS DEBT FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

Yankee Dollars, continued
	Principal
	Amount ($)	Value ($)
Iraq – 0.5%
Republic of Iraq, Registered,
5.80%, 1/15/28, Callable
12/23/13 @ 100.00	250,000	217,500
Ireland (Republic of) – 0.5%
Vnesheconombank, Registered,
5.38%, 2/13/17	200,000	213,640
Kazakhstan – 0.9%
Development Bank of Kazakhstan,
4.13%, 12/10/22 (a)	200,000	184,500
Kazakhstan Temir Zholy, Registered,
6.95%, 7/10/42	200,000	209,250
		393,750
Lebanon – 0.3%
Republic of Lebanon, Registered,
Series 42, 8.25%, 4/12/21, MTN	100,000	111,000
Lithuania – 1.0%
Republic of Lithuania, Registered,
6.13%, 3/9/21	150,000	171,938
Republic of Lithuania, Registered,
6.63%, 2/1/22	200,000	237,500
		409,438
Malaysia – 0.3%
Petronas Capital Ltd.,
5.25%, 8/12/19	100,000	112,505
Mexico – 12.1%
Banco Santander SA,
4.13%, 11/9/22 (a)	150,000	143,437
Comision Federal de Electricidad,
4.88%, 1/15/24 (a)	200,000	202,750
Petroleos Mexicanos,
5.50%, 1/21/21	1,000,000	1,090,000
Petroleos Mexicanos,
6.50%, 6/2/41	200,000	213,000
Petroleos Mexicanos,
5.50%, 6/27/44	30,000	28,050
United Mexican States,
4.00%, 10/2/23	1,360,000	1,381,080
United Mexican States, Series A,
7.50%, 4/8/33, MTN	100,000	132,000
United Mexican States, Series A,
6.75%, 9/27/34, MTN	90,000	110,250
United Mexican States, Series A,
6.05%, 1/11/40	1,606,000	1,818,795
		5,119,362
Namibia – 0.5%
Namibia International Bond,
Registered, 5.50%, 11/3/21	200,000	210,500
Nigeria – 0.5%
Republic of Nigeria,
6.38%, 7/12/23 (a)	200,000	211,500
Panama – 3.5%
Republic of Panama,
5.20%, 1/30/20	875,000	967,750
Republic of Panama,
7.13%, 1/29/26	200,000	248,500
Republic of Panama,
6.70%, 1/26/36	95,000	112,338
Republic of Panama,
4.30%, 4/29/53	200,000	163,200
		1,491,788
Paraguay – 0.5%
Republic of Paraguay,
4.63%, 1/25/23 (b)	200,000	189,000
Peru – 2.2%
Banco de Credito del Peru, Registered,
4.25%, 4/1/23	70,000	66,675
Republic of Peru, 7.13%, 3/30/19	100,000	121,800
Republic of Peru, 7.35%, 7/21/25	100,000	128,900
Republic of Peru, 8.75%, 11/21/33	110,000	160,380
Republic of Peru, 6.55%, 3/14/37	390,000	464,685
		942,440
Philippines – 1.7%
Power Sector Assets & Liabilities
Management Corp., Registered,
7.25%, 5/27/19	100,000	121,000
Republic of Philippines,
6.50%, 1/20/20	175,000	210,000
Republic of Philippines,
4.00%, 1/15/21	250,000	266,563
Republic of Philippines,
7.75%, 1/14/31	100,000	134,500
		732,063
Poland – 2.1%
Republic of Poland, 5.13%, 4/21/21	465,000	513,244
Republic of Poland, 5.00%, 3/23/22	350,000	382,812
		896,056
Republic of Serbia – 0.5%
Republic of Serbia, Registered,
7.25%, 9/28/21	200,000	208,000
Romania – 0.7%
Romania, Registered,
6.75%, 2/7/22, MTN	260,000	300,300
Russian Federation – 12.8%
Alfa Issuance Ltd., Series E,
8.00%, 3/18/15, MTN	100,000	107,120
Gazprom OAO, Registered,
9.25%, 4/23/19	125,000	155,938
Gazprom OAO, Registered,
6.51%, 3/7/22, MTN	100,000	109,750
Gazprom OAO, Registered,
7.29%, 8/16/37, MTN	100,000	111,000
RSHB Capital SA, 6.30%, 5/15/17	475,000	511,812
Russia Foreign Bond,
4.88%, 9/16/23 (a)	400,000	419,600

See notes to financial statements. HSBC FAMILY OF FUNDS       19

HSBC EMERGING MARKETS DEBT FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

Yankee Dollars, continued
	Principal
	Amount ($)	Value ($)
Russian Federation, continued
Russia Foreign Bond, Registered,
7.50%, 3/31/30	2,727,725	3,246,129
RZD Capital Ltd., Series E,
5.74%, 4/3/17, MTN	500,000	538,125
Sberbank, Registered,
5.18%, 6/28/19	200,000	212,220
		5,411,694
Slovenia – 0.5%
Republic of Slovenia,
5.85%, 5/10/23 (a)	200,000	195,000
South Africa – 4.6%
Republic of South Africa,
6.88%, 5/27/19	350,000	404,250
Republic of South Africa,
5.50%, 3/9/20	175,000	189,875
Republic of South Africa,
5.88%, 5/30/22	200,000	219,000
Republic of South Africa,
4.67%, 1/17/24	640,000	632,000
Republic of South Africa,
5.88%, 9/16/25	450,000	479,902
		1,925,027
Sri Lanka – 0.5%
Bank of Ceylon, Registered,
6.88%, 5/3/17	200,000	205,000
Turkey – 11.3%
Republic of Turkey, 5.63%, 3/30/21	1,975,000	2,108,312
Republic of Turkey, 5.13%, 3/25/22	1,175,000	1,203,200
Republic of Turkey, 7.38%, 2/5/25	290,000	339,300
Republic of Turkey, 6.75%, 5/30/40	100,000	109,000
Republic of Turkey, 6.00%, 1/14/41	600,000	603,000
Turkiye Is Bankasi AS,
3.88%, 11/7/17 (a)	200,000	194,760
Turkiye Vakiflar Bankasi TAO,
5.00%, 10/31/18 (a)	200,000	199,010
		4,756,582
Uruguay – 0.9%
Republic of Uruguay,
7.63%, 3/21/36	40,000	51,300
Republic of Uruguay, PIK,
7.88%, 1/15/33	260,000	340,210
		391,510
Venezuela – 5.1%
Bolivarian Republic of Venezuela,
7.65%, 4/21/25	275,000	201,162
Bolivarian Republic of Venezuela,
9.25%, 5/7/28	550,000	437,250
Republic of Venezuela,
7.00%, 12/1/18	100,000	83,250
Republic of Venezuela,
7.75%, 10/13/19	1,490,000	1,221,800
Republic of Venezuela, Registered,
8.25%, 10/13/24	200,000	152,500
Republic of Venezuela, Registered,
7.00%, 3/31/38	100,000	66,900
		2,162,862
TOTAL YANKEE DOLLARS
(COST $39,600,980)		39,954,995
U.S. Treasury Obligation – 0.6%
	Shares or
	Principal
	Amount ($)
U.S. Treasury Notes – 0.6%
2.50%, 8/15/23	225,000	224,156
TOTAL U.S. TREASURY
OBLIGATION (COST $222,612)		224,156
Investment Companies – 5.5%
Northern Institutional Diversified
Assets Portfolio, Institutional
Shares, 0.01% (c)	2,310,542	2,310,542
TOTAL INVESTMENT COMPANIES
(COST $2,310,542)		2,310,542
TOTAL INVESTMENT SECURITIES
(COST $42,145,028) — 100.8%		42,500,543

____________________
 

Percentages indicated are based on net assets of $42,189,060.
(a)	Rule 144A security or other security which is restricted as to resale to institutional investors. This security has been deemed liquid by the Investment Adviser based on procedures approved by the Board of Trustees.
(b)	Rule 144A security or other security which is restricted as to resale to institutional investors. This security has been deemed illiquid by the Investment Adviser based on procedures approved by the Board of Trustees.
(c)	The rate represents the annualized one-day yield that was in effect on October 31, 2013.

MTN — Medium Term Note
PIK — Payment-in-Kind

The Fund invested, as a percentage of net assets at value, in the following industries, as of October 31, 2013:

	Percentage of Net Assets
Industry	at Value (%)
Sovereign Bonds		70.6
Diversified Financial Services		11.5
Oil, Gas & Consumable Fuels		6.2
Investment Companies		5.5
Commercial Banks		5.1
Electrical Equipment		0.8
U.S. Treasury Obligation		0.6
Energy Equipment & Services		0.3
Metals & Mining		0.2
		100.8

20       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC EMERGING MARKETS DEBT FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

Futures Contracts Purchased

						Unrealized
			Number of	Notional		Appreciation/
Description	Type	Expiration Date	Contracts	Value		(Depreciation)
10-Year U.S. Treasury Note December Future	Long	12/20/13	21	$	2,674,547		$91,503
				$	2,674,547		$91,503

Credit Default Swap Agreements - Sell Protection(a)

At October 31, 2013, the Fund’s open credit default swap agreements were as follows:

								Upfront
			Implied Credit					Premiums			Unrealized
			Spread at	Notional	Fixed			Paid/			Appreciation/
		Expiration	October 31, 2013	Amount	Rate	Value		(Received)			(Depreciation)
Underlying Instrument	Counterparty	Date	(%) (b)	($)(c)	(%)	($)		($)			($)
Federative	JPMorgan
Republic of Brazil	Chase Bank N.A.	06/20/18	1.62	500,000	1.00	(13,068	)		(9,814	)		(3,254	)
Federative	Barclays Bank PLC
Republic of Brazil		06/20/18	1.62	300,000	1.00	(7,841	)		(8,671	)		830
Federative	Barclays Bank PLC
Republic of Brazil		09/20/16	1.33	550,000	1.00	(2,827	)		(11,666	)		8,839
Peoples Republic of	JPMorgan
China	Chase Bank N.A.	09/20/16	0.41	500,000	1.00	9,367			(3,227	)		12,594
Peoples Republic of	JPMorgan
China	Chase Bank N.A.	09/20/16	0.41	500,000	1.00	9,366			(4,641	)		14,007
						(5,003	)		(38,019	)		33,016

(a)	When a credit event occurs as defined under the terms of the swap agreement, the Fund as a seller of credit protection will either (i) pay to the buyer of protection an amount equal to the par value of the defaulted reference entity and take delivery of the reference entity or (ii) pay a net amount equal to the par value of the defaulted reference entity less its recovery value.
(b)	Implied credit spread, represented in absolute terms, utilized in determining the fair value of the credit default swap agreements as of period end serve as an indicator of the current status of the payment/performance risk and represent the likelihood or risk of default for the credit derivative. The implied credit spread of a referenced entity reflects the cost of buying/selling protection and may include upfront payments required to be made to enter into the agreement. Generally, wider credit spreads represent a perceived deterioration of the referenced entity’s credit soundness and a greater likelihood or risk of default or other credit event occurring as defined under the terms of the swap agreement.
(c)	The notional amount represents the maximum potential amount of future payments that the Fund could be required to make as a seller of credit protection if a credit event occurs, as defined under the terms of the swap agreement.

See notes to financial statements. HSBC FAMILY OF FUNDS        21

HSBC EMERGING MARKETS DEBT FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

At October 31, 2013, the Fund’s open forward foreign currency exchange contracts were as follows:

			Contract			Unrealized
			Amount	Contract		Appreciation/
		Delivery	(Local	Value		(Depreciation)
Short Contracts	Counterparty	Date	Currency)	($)	Value ($)	($)
Brazilian Real	Barclays Bank PLC	2/4/14	453,915	204,062	198,175		5,887
Brazilian Real	Standard Chartered Bank	11/4/13	453,915	210,000	202,488		7,512
Brazilian Real	Standard Chartered Bank	11/4/13	905,848	404,577	404,091		486
Indian Rupee	Barclays Bank PLC	1/16/14	7,537,488	120,000	120,499		(499	)
Mexican Peso	Barclays Bank PLC	11/14/13	1,573,920	122,057	120,517		1,540
South African Rand	Standard Chartered Bank	12/9/13	23,898	2,429	2,369		60
				1,063,125	1,048,139		14,986
			Contract			Unrealized
			Amount	Contract		Appreciation/
		Delivery	(Local	Value		(Depreciation)
Long Contracts	Counterparty	Date	Currency)	($)	Value ($)	($)
Brazilian Real	Barclays Bank PLC	11/4/13	453,915	208,409	202,488		(5,921	)
Brazilian Real	Barclays Bank PLC	11/4/13	905,848	398,000	404,091		6,091
Brazilian Real	Standard Chartered Bank	2/4/14	905,848	396,502	395,485		(1,017	)
Indian Rupee	Standard Chartered Bank	1/16/14	7,563,600	120,000	120,916		916
Mexican Peso	Barclays Bank PLC	1/16/14	1,573,920	121,454	119,917		(1,537	)
Mexican Peso	Standard Chartered Bank	11/14/13	1,573,920	120,000	120,517		517
South African Rand	Standard Chartered Bank	12/9/13	23,898	2,317	2,369		52
South African Rand	Standard Chartered Bank	1/30/14	23,898	2,411	2,351		(60	)
				1,369,093	1,368,134		(959	)

22       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC EMERGING MARKETS LOCAL DEBT FUND

Schedule of Portfolio Investments—as of October 31, 2013

Foreign Bonds – 67.8%†
	Principal
	Amount ($)	Value ($)
Brazil – 9.2%
Nota do Tesouro Nacional,
Series F, 10.00%, 1/1/17	6,400,000	2,846,543
Colombia – 1.5%
Republic of Colombia,
9.85%, 6/28/27	650,000,000	458,460
Indonesia – 7.4%
Indonesia Government,
Series FR28, 10.00%, 7/15/17	9,100,000,000	882,130
Indonesia Government,
Series FR56, 8.38%, 9/15/26	9,605,000,000	890,481
Indonesia Government,
Series FR65, 6.63%, 5/15/33	6,890,000,000	521,414
		2,294,025
Malaysia – 4.5%
Malaysian Government,
Series 0111, 4.16%, 7/15/21	305,000	99,946
Malaysian Government,
Series 0112, 3.42%, 8/15/22	3,850,000	1,199,072
Malaysian Government,
Series 0412, 4.13%, 4/15/32	340,000	108,013
		1,407,031
Mexico – 4.5%
Mexican Bonos Desarr,
Series M, 8.00%, 12/7/23 (a)	11,400,000	998,170
Mexican Bonos Desarr,
Series M30, 8.50%, 11/18/38 (a)	2,600,000	225,358
Mexican Bonos Desarr,
Series M, 7.75%, 11/13/42 (a)	2,000,000	160,624
		1,384,152
Peru – 3.0%
Peru Bono Soberano,
9.91%, 5/5/15	515,000	201,912
Republic of Peru, Registered,
6.95%, 8/12/31	1,500,000	583,276
Republic of Peru, Registered,
6.90%, 8/12/37	400,000	154,530
		939,718
Poland – 4.8%
Poland Government Bond,
Series 1021, 5.75%, 10/25/21	1,040,000	375,784
Poland Government Bond,
Series 0922, 5.75%, 9/23/22	660,000	239,809
Poland Government Bond,
Series 0429, 5.75%, 4/25/29	2,350,000	863,567
		1,479,160
Russian Federation – 11.1%
Russia Foreign Bond,
7.85%, 3/10/18	100,000,000	3,246,347
Russia Government Bond,
Series 6206, 7.40%, 6/14/17 (a)	6,000,000	192,627
		3,438,974
South Africa – 3.3%
Republic of South Africa,
Series R203, 8.25%, 9/15/17	2,477,000	261,055
Republic of South Africa,
Series R213, 7.00%, 2/28/31	1,800,000	153,065
Republic of South Africa,
Series R209, 6.25%, 3/31/36	8,000,000	597,892
		1,012,012
Thailand – 10.7%
Thailand Government Bond,
4.13%, 11/18/16	91,500,000	3,032,410
Thailand Government Bond,
3.63%, 6/16/23	9,000,000	283,365
		3,315,775
Turkey – 7.9%
Turkey Government Bond,
Series 5Y, 6.30%, 2/14/18 (a)	2,500,000	1,175,535
Turkey Government Bond,
Series CPI, 3.00%, 1/6/21	240,000	153,980
Turkey Government Bond,
9.50%, 1/12/22 (a)	590,000	311,125
Turkey Government Bond,
Series CPI, 3.00%, 2/23/22	1,400,000	812,009
		2,452,649
TOTAL FOREIGN BONDS
(COST $22,879,380)		21,028,499
Yankee Dollars – 6.1%
Brazil – 0.5%
Petrobras Global Finance BV,
2.00%, 5/20/16	150,000	149,055
China – 0.7%
CNOOC Finance (2013) Ltd.,
1.13%, 5/9/16	200,000	198,813
Luxembourg – 1.0%
VTB Bank OJSC (VTB Capital SA),
Registered, 6.47%, 3/4/15	300,000	316,860
Russian Federation – 1.9%
Alfa Issuance Ltd.,
Series E, 8.00%, 3/18/15, MTN	300,000	321,360
Sberbank of Russia (SB Capital SA),
5.50%, 7/7/15	250,000	264,688
		586,048
Turkey – 2.0%
Republic of Turkey, 7.00%, 9/26/16	565,000	629,523
TOTAL YANKEE DOLLARS
(COST $1,891,695)		1,880,299

See notes to financial statements. HSBC FAMILY OF FUNDS        23

HSBC EMERGING MARKETS LOCAL DEBT FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

U.S. Treasury Obligations – 3.3%
	Shares or
	Principal
	Amount ($)	Value ($)
U.S. Treasury Bills – 2.5%
0.05%, 6/26/14(b)	750,000	749,642
U.S. Treasury Bonds – 0.8%
3.13%, 2/15/43	280,000	253,575
TOTAL U.S. TREASURY OBLIGATIONS
(COST $1,043,462)		1,003,217
Investment Companies – 19.7%
Northern Institutional Diversified
Assets Portfolio, Institutional
Shares, 0.01% (c)	6,091,520	6,091,520
TOTAL INVESTMENT COMPANIES
(COST $6,091,520)		6,091,520
TOTAL INVESTMENT SECURITIES
(COST $31,906,057) — 96.9%		30,003,535

____________________

Percentages indicated are based on net assets of $30,956,500.
†	The principal amount is disclosed in local currency and the value is disclosed in U.S. Dollars.
(a)	Variable rate security. The interest rates on these securities are adjusted periodically to reflect then-current short-term interest rates. The rates presented represent the rates in effect on October 31, 2013. The maturity dates presented reflect the final maturity dates. However, some of these securities may contain put or demand features that allow the Fund to require the issuer to repurchase the security from the fund within various time periods, including daily, weekly, monthly, or semi-annually.
(b)	Discount note. Rate presented represents the effective yield at time of purchase.
(c)	The rate represents the annualized one-day yield that was in effect on October 31, 2013.
MTN — Medium Term Note

The Fund invested, as a percentage of net assets at value, in the following industries, as of October 31, 2013:

	Percentage of Net Assets
Industry	at Value (%)
Sovereign Bonds		69.9
Investment Companies		19.7
U.S. Treasury Obligations		3.3
Diversified Financial Services		3.0
Commercial Banks		1.0
		96.9

Interest Rate Swap Agreements

At October 31, 2013, $350,000 of cash was segregated for forward foreign currency exchange contracts and swap agreements. At October 31, 2013, the Fund’s open interest rate swap agreements were as follows:

Pay/										Unrealized
Receive		Fixed			Notional		Notional			Appreciation/
Floating		Rate	Expiration		Amount		Amount	Value		(Depreciation)
Rate	Floating Rate Index	(%)	Date	Counterparty	(Local)		($)	($)		($)
	3-Month MYR-
Pay	KLIBOR-BNM	3.24	5/3/18	Standard Charter Bank	1,500,000	MYR	475,571	(7,500	)		(7,500	)
				JPMorgan
Pay	1-Year BRL CDI	9.96	1/2/15	Chase Bank N.A.	5,100,000	BRL	2,277,192	(15,502	)		(15,502	)
	1-Month			Credit Suisse
Pay	MXN-TIIE-Banxico	6.38	7/11/23	International	14,000,000	MXN	1,073,175	(8,886	)		(8,886	)
Pay	1-Year BRL CDI	9.71	1/2/15	Barclays Bank PLC	5,700,000	BRL	2,545,097	(24,393	)		(24,393	)
	3-Month ZAR-			JPMorgan
Pay	JIBAR-SAFEX	5.94	8/8/15	Chase Bank N.A.	17,000,000	ZAR	1,695,135	8,115			8,115
	1-Month
Pay	MXN-TIIE-Banxico	4.33	9/8/15	Barclays Bank PLC	24,603,000	MXN	1,885,952	(6,279	)		(6,279	)
	1-Month			JPMorgan
Pay	MXN-TIIE-Banxico	6.47	9/12/23	Chase Bank N.A.	6,000,000	MXN	459,932	(2,012	)		(2,012	)
Pay	1-Year BRL CDI	10.94	1/4/16	Barclays Bank PLC	5,700,000	BRL	2,545,097	(12,354	)		(12,354	)
	1-Month
Pay	MXN-TIIE-Banxico	6.21	10/6/23	Barclays Bank PLC	10,000,000	MXN	766,554	(19,104	)		(19,104	)
	1-Month
Pay	MXN-TIIE-Banxico	6.69	12/23/21	Barclays Bank PLC	6,250,000	MXN	479,096	15,396			15,396
				JPMorgan
Pay	1-Year BRL CDI	10.44	1/2/14	Chase Bank N.A.	2,200,000	BRL	982,318	38,238			38,238
Pay	1-Year BRL CDI	10.02	1/4/21	Barclays Bank PLC	2,400,000	BRL	1,071,620	(54,874	)		(54,874	)
	1-Year ZAR-
Pay	JIBAR-SAFEX	5.98	1/24/18	Barclays Bank PLC	20,000,000	ZAR	1,994,276	(60,373	)		(60,373	)
	3-Month MYR-
Pay	KLIBOR-BNM	3.52	1/25/18	Standard Charter Bank	2,200,000	MYR	697,505	(1,826	)		(1,826	)
								(151,354	)		(151,354	)

24       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC EMERGING MARKETS LOCAL DEBT FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

At October 31, 2013, the Fund’s open forward foreign currency exchange contracts were as follows:

			Contract			Unrealized
			Amount	Contract		Appreciation/
		Delivery	(Local	Value	Value	(Depreciation)
Short Contracts	Counterparty	Date	Currency)	($)	($)	($)
Brazilian Real	Barclays Bank PLC	11/4/13	183,976	80,000	82,070		(2,070	)
Brazilian Real	Barclays Bank PLC	2/4/14	328,104	147,000	143,247		3,753
Brazilian Real	Barclays Bank PLC	2/4/14	994,290	446,992	434,098		12,894
Brazilian Real	JPMorgan Chase Bank N.A.	11/4/13	2,811,820	1,150,972	1,254,329		(103,357	)
Brazilian Real	Standard Chartered Bank	11/4/13	994,290	460,000	443,544		16,456
Brazilian Real	Standard Chartered Bank	11/4/13	2,610,813	1,166,062	1,164,661		1,401
Chinese Yuan	JPMorgan Chase Bank N.A.	2/20/14	430,290	70,000	70,346		(346	)
Chinese Yuan	Standard Chartered Bank	11/5/13	4,199,925	683,804	688,983		(5,179	)
Colombian Peso	Barclays Bank PLC	12/6/13	66,395,000	35,000	34,987		13
Colombian Peso	Standard Chartered Bank	12/6/13	2,335,738,345	1,236,822	1,230,834		5,988
European Euro	Barclays Bank PLC	12/16/13	45,473	60,559	61,738		(1,179	)
Hungarian Forint	Standard Chartered Bank	12/18/13	69,861,800	326,000	320,092		5,908
Indian Rupee	Barclays Bank PLC	1/16/14	18,843,720	300,000	301,247		(1,247	)
Indonesian Rupiah	Barclays Bank PLC	2/7/14	752,700,000	65,000	65,696		(696	)
Indonesian Rupiah	Standard Chartered Bank	11/4/13	2,318,060,000	217,148	205,644		11,504
Indonesian Rupiah	Standard Chartered Bank	2/7/14	400,160,000	34,304	34,926		(622	)
Korean Won	JPMorgan Chase Bank N.A.	11/4/13	651,600,000	600,000	614,244		(14,244	)
Korean Won	JPMorgan Chase Bank N.A.	2/6/14	651,600,000	602,998	612,119		(9,121	)
Malaysian Ringgit	Standard Chartered Bank	11/4/13	6,729,436	2,116,175	2,132,958		(16,783	)
Mexican Peso	Barclays Bank PLC	11/14/13	3,895,800	300,000	298,306		1,694
Mexican Peso	Barclays Bank PLC	1/16/14	3,895,800	300,625	296,821		3,804
Peruvian Nuevo Sol	Standard Chartered Bank	12/9/13	1,357,373	479,976	487,633		(7,657	)
Peruvian Nuevo Sol	Standard Chartered Bank	2/20/14	1,357,373	486,863	484,394		2,469
Philippine Peso	Standard Chartered Bank	11/8/13	8,118,880	188,155	187,995		160
Polish Zloty	Standard Chartered Bank	12/20/13	252,880	81,443	81,876		(433	)
Russian Ruble	Standard Chartered Bank	2/6/14	13,936,495	424,020	427,760		(3,740	)
South African Rand	Standard Chartered Bank	12/9/13	23,973,193	2,436,796	2,376,847		59,949
Thai Baht	Standard Chartered Bank	11/18/13	2,981,100	95,000	95,749		(749	)
Thai Baht	Standard Chartered Bank	11/18/13	18,474,450	580,000	593,376		(13,376	)
Thai Baht	Standard Chartered Bank	11/18/13	33,450,258	1,108,542	1,074,380		34,162
Thai Baht	Standard Chartered Bank	1/30/14	52,063,608	1,661,781	1,664,667		(2,886	)
Taiwan Dollar	JPMorgan Chase Bank N.A.	2/7/14	8,872,500	304,270	302,777		1,493
Taiwan Dollar	Standard Chartered Bank	11/1/13	8,872,500	300,000	302,012		(2,012	)
				18,546,307	18,570,356		(24,049	)

See notes to financial statements. HSBC FAMILY OF FUNDS        25

HSBC EMERGING MARKETS LOCAL DEBT FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

			Contract			Unrealized
			Amount	Contract		Appreciation/
		Delivery	(Local	Value	Value	(Depreciation)
Long Contracts	Counterparty	Date	Currency)	($)	($)	($)
Brazilian Real	Barclays Bank PLC	11/4/13	994,290	456,515	443,544		(12,971	)
Brazilian Real	Standard Chartered Bank	11/4/13	4,536,969	1,932,271	2,023,902		91,631
Brazilian Real	Standard Chartered Bank	11/4/13	1,069,640	440,000	477,157		37,157
Brazilian Real	Standard Chartered Bank	2/4/14	2,610,813	1,142,788	1,139,857		(2,931	)
Chilean Peso	Barclays Bank PLC	12/18/13	20,850,000	39,946	40,441		495
Chilean Peso	Standard Chartered Bank	12/18/13	305,462,040	600,000	592,481		(7,519	)
Chinese Yuan	Standard Chartered Bank	11/5/13	4,199,925	677,571	688,983		11,412
Chinese Yuan	Standard Chartered Bank	2/20/14	4,199,925	683,192	686,620		3,428
Colombian Peso	Standard Chartered Bank	12/6/13	2,402,133,345	1,227,143	1,265,821		38,678
Colombian Peso	Standard Chartered Bank	2/28/14	2,335,738,345	1,228,237	1,222,836		(5,401	)
Hungarian Forint	Standard Chartered Bank	12/18/13	259,444,812	1,167,855	1,188,721		20,866
Indian Rupee	JPMorgan Chase Bank N.A.	1/16/14	19,376,000	280,000	309,757		29,757
Indonesian Rupiah	Standard Chartered Bank	11/4/13	400,160,000	35,133	35,500		367
Indonesian Rupiah	Credit Suisse	11/4/13	1,917,900,000	180,000	170,145		(9,855	)
Korean Won	JPMorgan Chase Bank N.A.	11/4/13	651,600,000	606,422	614,244		7,822
Malaysian Ringgit	Barclays Bank PLC	11/4/13	1,783,375	550,000	565,257		15,257
Malaysian Ringgit	JPMorgan Chase Bank N.A.	2/10/14	224,588	70,000	70,714		714
Malaysian Ringgit	Standard Chartered Bank	11/4/13	4,946,061	1,509,326	1,567,701		58,375
Malaysian Ringgit	Standard Chartered Bank	2/10/14	493,865	156,000	155,500		(500	)
Malaysian Ringgit	Standard Chartered Bank	2/10/14	6,729,436	2,105,449	2,118,848		13,399
Mexican Peso	Barclays Bank PLC	1/16/14	10,127,278	786,646	771,596		(15,050	)
Mexican Peso	Barclays Bank PLC	11/14/13	3,895,800	302,117	298,306		(3,811	)
Mexican Peso	Standard Chartered Bank	1/16/14	19,545,065	1,445,640	1,489,136		43,496
Peruvian Nuevo Sol	Standard Chartered Bank	12/9/13	1,357,373	490,912	487,632		(3,280	)
Philippine Peso	Credit Suisse	11/8/13	8,118,880	186,942	187,995		1,053
Philippine Peso	Standard Chartered Bank	2/25/14	8,118,880	188,679	188,255		(424	)
Polish Zloty	JPMorgan Chase Bank N.A.	12/20/13	4,116,441	1,292,040	1,332,786		40,746
Romanian Leu	Standard Chartered Bank	12/18/13	1,113,572	324,278	340,620		16,342
Russian Ruble	Barclays Bank PLC	2/6/14	990,525	30,000	30,403		403
Singapore Dollar	JPMorgan Chase Bank N.A.	1/16/14	743,683	595,237	598,872		3,635
South African Rand	Standard Chartered Bank	12/9/13	1,219,413	122,798	120,900		(1,898	)
South African Rand	Standard Chartered Bank	12/9/13	22,753,780	2,206,534	2,255,947		49,413
South African Rand	Standard Chartered Bank	1/30/14	23,973,193	2,417,871	2,358,002		(59,869	)
Thai Baht	Standard Chartered Bank	11/18/13	2,842,200	90,000	91,288		1,288
Thai Baht	Standard Chartered Bank	11/18/13	52,063,608	1,668,705	1,672,217		3,512
Turkish Lira	Barclays Bank PLC	1/15/14	206,896	103,000	102,316		(684	)
Turkish Lira	Standard Chartered Bank	1/15/14	1,129,570	562,339	558,603		(3,736	)
Taiwan Dollar	JPMorgan Chase Bank N.A.	11/1/13	8,872,500	302,816	302,012		(804	)
				28,204,402	28,564,915		360,513

26       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC FRONTIER MARKETS FUND

Schedule of Portfolio Investments—as of October 31, 2013

Common Stocks – 83.0%
	Shares	Value ($)
Cambodia – 1.0%
NagaCorp Ltd.	992,000	916,149
Colombia – 2.2%
Banco Davivienda SA	114,094	1,496,698
Ecopetrol SA	175,062	416,365
		1,913,063
Croatia – 0.6%
Hrvatski Telekom dd	18,622	552,963
Egypt – 1.1%
Centamin plc *	744,375	599,080
Global Telecom Holding SAE*	119,093	408,894
		1,007,974
Estonia – 1.5%
Tallink Group Ltd.	1,026,555	1,342,093
Georgia – 2.6%
Bank of Georgia Holdings plc	73,916	2,339,241
Kazakhstan – 1.7%
KazMunaiGas Exploration
Production GDR (a)	108,164	1,534,847
Kenya – 1.0%
Safaricom Ltd.(b)	8,117,600	899,312
Kuwait – 6.4%
Kuwait Projects Co. (Holding) KSC	926,875	2,007,078
Mabanee Co. SAKC	327,550	1,418,569
Mobile Telecommunications Co.	522,500	1,316,915
National Bank of Kuwait	285,350	921,791
		5,664,353
Lebanon – 0.2%
Banque Audi SAL -
Audi Saradar Group	22,987	141,370
Nigeria – 11.0%
Dangote Cement plc	988,769	1,183,781
Diamond Bank plc *	27,506,532	1,152,605
FBN Holdings plc	15,787,370	1,611,565
Guaranty Trust Bank plc	8,705,082	1,387,767
Nestle Foods Nigeria plc	199,204	1,380,746
Nigerian Breweries plc	1,343,588	1,481,587
Zenith Bank plc	11,563,348	1,569,468
		9,767,519
Oman – 3.8%
Bank Muscat SAOG	1,304,717	2,026,548
Renaissance Services SAOG *	723,963	1,323,818
		3,350,366
Pakistan – 9.9%
Bank Alfalah Ltd.	2,341,500	498,145
D.G. Khan Cement Co. Ltd.	2,696,500	1,808,197
Engro Corp. Ltd. *	1,487,200	1,765,684
MCB Bank Ltd.	241,745	637,350
Pakistan Petroleum Ltd.	757,350	1,449,257
The Hub Power Co. Ltd.	2,387,192	1,399,874
United Bank Ltd.	1,021,700	1,179,408
		8,737,915
Panama – 2.1%
Copa Holdings SA, Class A	12,248	1,831,566
Peru – 2.6%
Credicorp Ltd.	16,800	2,294,880
Philippines – 3.5%
Cebu Air, Inc.	785,700	959,391
Security Bank Corp.	341,870	1,099,998
SM Investments Corp.	53,245	1,055,040
		3,114,429
Qatar – 13.9%
Doha Bank QSC	93,110	1,407,075
Gulf International Services QSC	78,702	1,267,190
Industries Qatar QSC	57,197	2,506,642
Qatar Electricity & Water Co.	24,126	1,054,000
Qatar Islamic Bank	36,477	678,525
Qatar National Bank	65,354	2,980,839
Qatar Telecom (QTEL) QSC	62,817	2,399,111
		12,293,382
Romania – 1.5%
SIF 5 Oltenia Craiova	2,564,547	1,320,247
Sri Lanka – 1.5%
John Keells Holdings plc	757,458	1,294,365
Turkmenistan – 1.5%
Dragon Oil plc	142,987	1,350,210
Ukraine – 0.0%
EastCoal, Inc. *(b)	36,050	2,939
EastCoal, Inc. *(b)	181,908	15,676
		18,615
United Arab Emirates – 13.4%
Al Noor Hospitals Group plc *	27,903	380,241
DP World Ltd.	113,316	1,915,041
Emaar Properties PJSC	2,016,816	3,338,572
First Gulf Bank PJSC	408,798	1,803,079
National Bank of Abu Dhabi	411,818	1,401,542
NMC Health plc	265,040	1,539,463
Union National Bank PJSC	1,061,845	1,459,968
		11,837,906
TOTAL COMMON STOCKS
(COST $70,069,095)		73,522,765
Preferred Stock – 0.5%
Colombia – 0.5%
Bancolombia SA,	33,887	474,623
TOTAL PREFERRED STOCK
(COST $500,820)		474,623

See notes to financial statements. HSBC FAMILY OF FUNDS        27

HSBC FRONTIER MARKETS FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

Convertible Corporate Bonds – 0.1%
	Shares or
	Principal
	Amount ($)	Value ($)
Oman – 0.1%
Bank Muscat SAOG, 4.50%, 3/20/16	45,141	12,311
Renaissance Services SAOG,
3.75%, 7/25/17	142,800	38,946
TOTAL CONVERTIBLE CORPORATE
BONDS (COST $59,301)		51,257
Warrants – 0.0%
Sri Lanka – 0.0%
John Keells Holdings plc *(b)	30,868	9,200
John Keells Holdings plc *(b)	30,868	6,841
		16,041
Ukraine – 0.0%
EastCoal, Inc. *(b)	360,500	—
TOTAL WARRANTS
(COST $—)		16,041
Participatory Notes – 12.0%
Saudi Arabia – 8.1%
Etihad Etisalat Co., 9/27/16,
(Deutsche Bank AG)	56,106	1,256,640
Samba Financial Group, 9/27/16,
(Deutsche Bank AG)	168,848	2,237,557
Saudi Dairy & Foodstuff Co., 3/25/15,
(Bank of America Corp.) *	12,126	295,149
Saudi Dairy & Foodstuff Co., 4/30/15,
(Citigroup Global Markets
Holding, Inc.) *	31,592	768,223
United Electronics Co., 2/13/15,
(Citigroup Global Markets
Holding, Inc.)	32,456	887,087
Yanbu National Petrochemical Co.,
10/14/15, (Credit Suisse AG)	100,576	1,736,425
		7,181,081
Vietnam – 3.9%
PetroVietnam Drilling & Well Services
JSC, 9/6/16, (JPMorgan Chase) *	541,980	1,620,520
Vietnam Dairy Products JSC, 1/20/15,
(Citigroup Global
Markets Holding, Inc.)	279,599	1,861,011
		3,481,531
TOTAL PARTICIPATORY NOTES
(COST $10,160,058)		10,662,612
Investment Companies – 2.6%
Northern Institutional Diversified
Assets Portfolio, Institutional
Shares, 0.01% (c)	2,324,522	2,324,522
TOTAL INVESTMENT COMPANIES
(COST $2,324,522)		2,324,522
TOTAL INVESTMENT SECURITIES
(COST $83,113,796) — 98.2%		87,051,820

____________________

Percentages indicated are based on net assets of $88,615,131.
*	Represents non-income producing security.
(a)	Rule 144A security or other security which is restricted as to resale to institutional investors. This security has been deemed liquid by the Investment Adviser based on procedures approved by the Board of Trustees.
(b)	Security was valued in good faith pursuant to procedures approved by the Board of Trustees as of October 31, 2013. The total of all such securities represents 1.05% of net assets of the Fund.
(c)	The rate represents the annualized one-day yield that was in effect on October 31, 2013.
GDR — Global Depositary Receipt

The Fund invested, as a percentage of net assets at value, in the following industries, as of October 31, 2013:

	Percentage of Net Assets
Industry	at Value (%)
Commercial Banks		38.4
Oil, Gas & Consumable Fuels		9.5
Diversified Financial Services		5.4
Food Products		4.9
Energy Equipment & Services		4.3
Construction Materials		3.4
Wireless Telecommunication Services		3.4
Airlines		3.1
Real Estate Management & Development		3.0
Diversified Telecommunication Services		2.7
Industrial Conglomerates		2.7
Investment Companies		2.6
Hotels, Restaurants & Leisure		2.3
Health Care Providers & Services		2.2
Chemicals		2.0
Beverages		1.7
Marine		1.6
Independent Power Producers &
Energy Traders		1.6
Capital Markets		1.5
Multi-Utilities		1.2
Metals & Mining		0.7
		98.2

28       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC TOTAL RETURN FUND

Schedule of Portfolio Investments—as of October 31, 2013

Foreign Bonds – 7.9%†
	Principal
	Amount ($)	Value ($)
Mexico – 7.3%
Mexican Bonos Desarr, Series M,
6.50%, 6/10/21 (a)	1,000,000	80,290
Mexican Bonos Desarr, Series M20,
10.00%, 12/5/24 (a)	240,000,000	24,234,768
Mexican Bonos Desarr, Series M30,
10.00%, 11/20/36 (a)	711,800	70,648
Mexican Cetes, Series BI, 0.00%,
11/14/13 (b)	3,200,000,000	24,496,359
		48,882,065
South Africa – 0.6%
Republic of South Africa,
Series R203, 8.25%, 9/15/17	35,115,000	3,700,824
TOTAL FOREIGN BONDS
(COST $54,642,044)		52,582,889
Yankee Dollars – 64.2%
Brazil – 9.9%
Banco Bradesco SA, Registered,
4.10%, 3/23/15	9,000,000	9,270,000
Banco do Brasil SA, Registered,
5.88%, 1/26/22	200,000	201,200
Banco do Estado do Rio Grande
do Sul SA, Registered,
7.38%, 2/2/22	1,900,000	1,961,750
Banco Nacional de Desenvolvimento
Economico e Social,
5.75%, 9/26/23 (c)	2,200,000	2,282,500
Banco Votorantim, Registered,
5.25%, 2/11/16, MTN	200,000	209,048
Caixa Economica Federal,
4.50%, 10/3/18 (c)	2,200,000	2,211,000
Caixa Economica Federal,
Registered, 2.38%, 11/6/17	3,750,000	3,562,500
Centrais Eletricas Brasileiras SA,
Registered, 6.88%, 7/30/19	2,160,000	2,359,800
Centrais Eletricas Brasileiras SA,
Registered, 5.75%, 10/27/21	2,775,000	2,733,375
Federal Republic of Brazil,
6.00%, 1/17/17	5,900,000	6,658,150
Federal Republic of Brazil,
2.63%, 1/5/23	14,025,000	12,517,312
Federal Republic of Brazil,
11.00%, 8/17/40,
Callable 8/17/15 @ 100.00	900,000	1,049,850
Petrobras International Finance Co.,
6.13%, 10/6/16	15,014,000	16,445,165
Petrobras International Finance Co.,
7.88%, 3/15/19	800,000	931,794
Petrobras International Finance Co.,
5.75%, 1/20/20	1,950,000	2,059,711
Votorantim Cimentos SA,
Registered, 7.25%, 4/5/41	1,600,000	1,576,000
		66,029,155
Canada – 0.2%
Harvest Operations Corp., 2.13%,
5/14/18 (c)	1,100,000	1,074,909
Chile – 1.1%
Banco del Estado de Chile,
2.00%, 11/9/17 (c)	2,600,000	2,553,509
Codelco, Inc., Registered,
7.50%, 1/15/19	1,300,000	1,575,812
CorpBanca SA, 3.13%, 1/15/18	2,400,000	2,260,039
Empresa Nacional de Petroleo,
Registered, 4.75%, 12/6/21	1,100,000	1,109,272
		7,498,632
China – 3.3%
CNOOC Curtis Funding No.1
Pty Ltd., 4.50%, 10/3/23 (c)	1,425,000	1,447,558
CNOOC Finance (2013) Ltd.,
1.13%, 5/9/16	1,300,000	1,292,284
CNPC General Capital Ltd.,
1.45%, 4/16/16 (c)	800,000	796,820
Sinopec Capital (2013) Ltd.,
1.25%, 4/24/16 (c)	3,300,000	3,280,296
Sinopec Group Overseas
Development (2012) Ltd.,
Registered, 3.90%, 5/17/22	10,000,000	9,883,110
Sinopec Group Overseas
Development (2013) Ltd.,
4.38%, 10/17/23 (c)	5,400,000	5,417,933
		22,118,001
Colombia – 9.7%
Banco Davivienda SA, Registered,
2.95%, 1/29/18	5,000,000	4,875,000
Banco de Bogota SA, Registered,
5.00%, 1/15/17	2,200,000	2,317,700
Bancolombia SA, 6.13%, 7/26/20	1,200,000	1,266,000
Bancolombia SA, 5.95%, 6/3/21	1,500,000	1,584,000
Grupo Aval Ltd., Registered,
5.25%, 2/1/17	3,410,000	3,580,500
Grupo Aval Ltd., Registered,
4.75%, 9/26/22	1,150,000	1,079,563
Republic of Colombia,
8.25%, 12/22/14	1,040,000	1,120,600
Republic of Colombia,
7.38%, 1/27/17	21,505,000	25,128,592
Republic of Colombia,
7.38%, 3/18/19	13,500,000	16,503,750
Republic of Colombia,
4.38%, 7/12/21	4,760,000	5,040,840
Republic of Colombia,
2.63%, 3/15/23,
Callable 12/15/22 @ 100.00	750,000	678,375
Republic of Colombia,
6.13%, 1/18/41	1,330,000	1,506,225
		64,681,145
Costa Rica – 0.2%
Republic of Costa Rica,
4.25%, 1/26/23 (c)	1,200,000	1,140,000

See notes to financial statements. HSBC FAMILY OF FUNDS        29

HSBC TOTAL RETURN FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

Yankee Dollars, continued
	Principal
	Amount ($)	Value ($)
Croatia – 1.0%
Croatia, Registered,
6.25%, 4/27/17	900,000	960,228
Croatia, Registered,
6.75%, 11/5/19	2,640,000	2,877,600
Croatia, Registered,
6.63%, 7/14/20	400,000	432,000
Croatia, Registered,
6.38%, 3/24/21	2,260,000	2,398,425
		6,668,253
Dominican Republic – 0.1%
Dominican Republic,
7.50%, 5/6/21	600,000	663,900
India – 0.2%
Vedanta Resources plc, Registered,
6.75%, 6/7/16	1,400,000	1,459,500
Indonesia – 5.0%
PT Pertamina (Persero) Tbk,
4.30%, 5/20/23 (c)	1,300,000	1,186,250
PT Pertamina Tbk, Registered,
4.88%, 5/3/22	1,300,000	1,251,250
Republic of Indonesia,
3.38%, 4/15/23 (c)	1,800,000	1,620,000
Republic of Indonesia, Registered,
7.25%, 4/20/15	4,784,000	5,154,760
Republic of Indonesia, Registered,
7.50%, 1/15/16	4,323,000	4,841,760
Republic of Indonesia, Registered,
6.88%, 3/9/17	1,750,000	1,990,625
Republic of Indonesia, Registered,
5.88%, 3/13/20	2,990,000	3,274,050
Republic of Indonesia, Registered,
4.88%, 5/5/21	7,260,000	7,532,250
Republic of Indonesia, Registered,
3.75%, 4/25/22	2,000,000	1,885,000
Republic of Indonesia, Registered,
5.38%, 10/17/23, MTN	4,500,000	4,744,035
		33,479,980
Iraq – 0.4%
Republic of Iraq, Registered,
5.80%, 1/15/28,
Callable 12/23/13 @ 100.00	2,675,000	2,327,250
Kazakhstan – 2.1%
Development Bank of Kazakhstan,
4.13%, 12/10/22 (c)	1,750,000	1,614,375
KazMunaiGaz Finance Sub B.V.,
Registered, 11.75%, 1/23/15	11,281,000	12,606,518
		14,220,893
Lithuania – 0.2%
Republic of Lithuania, Registered,
7.38%, 2/11/20	870,000	1,057,050
Luxembourg – 0.2%
VTB Bank OJSC (VTB Capital SA),
Registered, 6.47%, 3/4/15	1,150,000	1,214,630
VTB Bank OJSC (VTB Capital SA),
Registered, 6.00%, 4/12/17	200,000	213,000
		1,427,630
Mexico – 5.1%
Banco Santander SA,
4.13%, 11/9/22 (c)	1,100,000	1,051,875
Comision Federal de Electricidad,
4.88%, 1/15/24 (c)	1,600,000	1,622,000
Petroleos Mexicanos,
4.88%, 3/15/15	2,000,000	2,100,000
United Mexican States,
5.63%, 1/15/17	7,410,000	8,314,020
United Mexican States,
4.00%, 10/2/23	8,290,000	8,418,495
United Mexican States,
Series A, 6.05%, 1/11/40	10,890,000	12,332,925
		33,839,315
Namibia – 0.5%
Namibia International Bond,
Registered, 5.50%, 11/3/21	3,400,000	3,578,500
Panama – 0.5%
Republic of Panama,
5.20%, 1/30/20	3,190,000	3,528,140
Peru – 2.6%
Banco de Credito del Peru,
Registered, 5.38%, 9/16/20	780,000	824,850
BBVA Banco Continental SA,
Registered, 2.25%, 7/29/16	5,000,000	4,987,500
Continental Senior Trust,
Registered, 5.75%, 1/18/17	3,150,000	3,421,813
Corp. Financiera de Desarrollo SA,
Registered, 4.75%, 2/8/22	200,000	201,000
El Fondo MIVIVIENDA SA,
Registered, 3.50%, 1/31/23	975,000	892,125
Republic of Peru,
8.38%, 5/3/16 (c)	4,525,000	5,271,625
Republic of Peru,
6.55%, 3/14/37	1,660,000	1,977,890
		17,576,803
Republic of Serbia – 0.1%
Republic of Serbia, Registered,
5.25%, 11/21/17	410,000	407,950
Russian Federation – 9.3%
AK Transneft OAO, Registered,
5.67%, 3/5/14	400,000	406,440
Alfa Bank OJSC, Registered,
7.88%, 9/25/17	1,200,000	1,345,488
Alfa Bank OJSC, Registered,
7.75%, 4/28/21	500,000	543,750
Alfa Issuance Ltd., Series E,
8.00%, 3/18/15, MTN	450,000	482,040

30       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC TOTAL RETURN FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

Yankee Dollars, continued
	Principal
	Amount ($)	Value ($)
Russian Federation, continued
Gazprom OAO, Registered,
Series 2009/2, 10.50%,
3/25/14, MTN	10,000,000	10,357,400
Gazprom OAO, Registered,
8.13%, 7/31/14	3,601,000	3,787,172
Gazprom OAO, Registered,
Series 7, 6.21%,11/22/16, MTN	4,600,000	5,063,220
Gazprom OAO, Registered,
9.25%, 4/23/19	2,050,000	2,557,375
Gazprom OAO, Registered,
6.00%, 1/23/21	1,200,000	1,281,000
Gazprom OAO, Registered,
6.51%, 3/7/22, MTN	11,100,000	12,182,250
Russia Foreign Bond,
4.88%, 9/16/23 (c)	2,400,000	2,517,600
Russia Foreign Bond, Registered,
7.50%, 3/31/30	8,265,400	9,836,239
Russian Agricultural Bank OJSC,
Registered, 7.13%, 1/14/14	503,000	508,332
Russian Federation, Registered,
3.25%, 4/4/17	1,600,000	1,674,000
RZD Capital Ltd., Registered,
5.70%, 4/5/22	300,000	314,250
Sberbank of Russia (SB Capital SA),
Registered, 4.95%, 2/7/17	5,600,000	5,950,000
Sibur Securities Ltd.,
3.91%, 1/31/18 (c)	3,100,000	3,030,250
		61,836,806
Slovenia – 0.5%
Republic of Slovenia,
5.85%, 5/10/23 (c)	3,400,000	3,315,000
South Africa – 4.3%
Eskom Holdings SOC Ltd.,
6.75%, 8/6/23 (c)	2,450,000	2,529,625
Republic of South Africa,
6.88%, 5/27/19	6,100,000	7,045,500
Republic of South Africa,
5.50%, 3/9/20	15,670,000	17,001,950
Republic of South Africa,
5.88%, 9/16/25	1,200,000	1,279,740
Transnet SOC Ltd., Registered,
4.50%, 2/10/16	800,000	833,240
		28,690,055
Turkey – 7.4%
Akbank TAS, Registered,
5.13%, 7/22/15	9,080,000	9,309,270
Republic of Turkey,
9.50%, 1/15/14	906,000	919,345
Republic of Turkey,
7.25%, 3/15/15	18,392,000	19,633,460
Republic of Turkey,
7.50%, 7/14/17	3,600,000	4,122,000
Republic of Turkey,
7.50%, 11/7/19	100,000	117,750
Republic of Turkey,
5.63%, 3/30/21	2,638,000	2,816,065
Republic of Turkey,
5.13%, 3/25/22	660,000	675,840
Republic of Turkey,
6.25%, 9/26/22	4,800,000	5,292,000
Turkiye Halk Bankasi AS,
3.88%, 2/5/20 (c)	2,500,000	2,270,325
Turkiye Is Bankasi AS,
3.88%, 11/7/17 (c)	1,000,000	973,800
Turkiye Is Bankasi AS,
5.50%, 4/21/19 (c)	1,450,000	1,466,313
Turkiye Vakiflar Bankasi TAO,
5.00%, 10/31/18 (c)	800,000	796,040
Turkiye Vakiflar Bankasi TAO,
6.00%, 11/1/22 (c)	1,400,000	1,310,750
		49,702,958
Uruguay – 0.3%
Republica Oriental del Uruguay,
4.50%, 8/14/24	1,755,000	1,812,037
Republica Oriental del Uruguay,
6.88%, 9/28/25	275,000	326,563
		2,138,600
TOTAL YANKEE DOLLARS
(COST $433,430,334)		428,460,425
	Shares or
	Principal
	Amount ($)
U.S. Treasury Obligations – 14.0%
U.S. Treasury Bonds – 1.6%
3.13%, 2/15/43	11,830,000	10,713,544
U.S. Treasury Notes – 12.3%
1.75%, 5/15/23	88,350,000	82,517,486
TOTAL U.S. TREASURY
OBLIGATIONS
(COST $97,143,299)		93,231,030
Investment Companies – 10.3%
Northern Institutional Diversified
Assets Portfolio, Institutional
Shares, 0.01% (d)	69,101,935	69,101,935
TOTAL INVESTMENT COMPANIES
(COST $69,101,935)		69,101,935
TOTAL INVESTMENT SECURITIES
(COST $654,317,612) — 96.4%		643,376,279

See notes to financial statements. HSBC FAMILY OF FUNDS        31

HSBC TOTAL RETURN FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

____________________

Percentages indicated are based on net assets of $667,571,668.
†	The principal amount is disclosed in local currency and the value is disclosed in U.S. Dollars.
(a)	Variable rate security. The interest rates on these securities are adjusted periodically to reflect then-current short-term interest rates. The rates presented represent the rates in effect on October 31, 2013. The maturity dates presented reflect the final maturity dates. However, some of these securities may contain put or demand features that allow the Fund to require the issuer to repurchase the security from the fund within various time periods, including daily, weekly, monthly, or semi-annually.
(b)	Zero-Coupon Security.
(c)	Rule 144A security or other security which is restricted as to resale to institutional investors. This security has been deemed liquid by the Investment Adviser based on procedures approved by the Board of Trustees.
(d)	The rate represents the annualized one-day yield that was in effect on October 31, 2013.
MTN — Medium Term Note

The Fund invested, as a percentage of net assets at value, in the following industries, as of October 31, 2013:

	Percentage of Net Assets
Industry	at Value (%)
Sovereign Bonds	43.1
U.S. Treasury Obligations	14.0
Investment Companies	10.3
Oil, Gas & Consumable Fuels	10.2
Commercial Banks	8.5
Diversified Financial Services	7.5
Energy Equipment & Services	2.1
Metals & Mining	0.5
Industrial Conglomerates	0.2
	96.4

Futures Contracts

At October 31, 2013, the Fund’s open futures contracts were as follows:

						Unrealized
		Expiration	Number of	Notional		Appreciation/
Description	Type	Date	Contracts	Value		(Depreciation)
10-Year U.S. Treasury Note December Future	Short	12/20/13	356	$	45,339,938	$(1,499,848)

Interest Rate Swap Agreements

At October 31, 2013, $9,510,000 of cash was segregated for forward foreign currency exchange contracts and swap agreements. At October 31, 2013, the Fund’s open interest rate swap agreements were as follows:

											Upfront
											Premiums			Unrealized
Pay/Receive		Fixed				Notional		Notional			Paid/			Appreciation/
Floating		Rate		Expiration		Amount		Amount	Value		(Received)			(Depreciation)
Rate	Floating Rate Index	(%)		Date	Counterparty	(Local)		($)	($)		($)			($)
					Barclays Bank
Pay	1-Year BRL CDI	9.71	%	1/2/15	PLC	120,800,000	BRL	53,938,203	(516,969	)		—			(516,969	)
					Credit Suisse
Pay	1-Year BRL CDI	9.93	%	1/2/15	International	272,600,000	BRL	121,718,164	(864,720	)		—			(864,720	)
	1-Month				Credit Suisse
Receive	MXN-TIIE-Banxico	4.29	%	9/9/15	International	194,337,000	MXN	14,896,975	(39,357	)		(753	)		(38,604	)
	1-Month				Standard
Pay	MXN-TIIE-Banxico	6.50	%	9/13/23	Charter Bank	48,000,000	MXN	3,679,458	(8,102	)		—			(8,102	)
	1-Month				Barclays Bank
Receive	MXN-TIIE-Banxico	5.31	%	9/20/18	PLC	124,000,000	MXN	9,505,266	(14,641	)		—			(14,641	)
	1-Month				Standard
Pay	MXN-TIIE-Banxico	6.54	%	9/14/23	Charter Bank	71,000,000	MXN	5,442,531	3,988			—			3,988
	1-Month				Standard
Receive	MXN-TIIE-Banxico	5.30	%	9/20/18	Charter Bank	124,000,000	MXN	9,505,266	(10,422	)		—			(10,422	)
	1-Month				Barclays Bank
Receive	MXN-TIIE-Banxico	5.30	%	9/20/18	PLC	124,000,000	MXN	9,505,266	(10,422	)		—			(10,422	)
	1-Month				Barclays Bank
Pay	MXN-TIIE-Banxico	6.54	%	9/14/23	PLC	71,000,000	MXN	5,442,531	3,988			—			3,988
	1-Month				Barclays Bank
Pay	MXN-TIIE-Banxico	6.54	%	9/14/23	PLC	71,000,000	MXN	5,442,531	3,988			—			3,988
					Standard
Receive	3-Month LIBOR BBA	1.96	%	5/17/22	Charter Bank	1,200,000	USD	1,200,000	34,198			—			34,198
					Barclays Bank
Receive	3-Month LIBOR BBA	1.77	%	8/10/22	PLC	13,000,000	USD	13,000,000	698,884			—			698,884
									(719,587	)		(753	)		(718,834	)

32        HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC TOTAL RETURN FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

Credit Default Swap Agreements - Buy Protection(a)

At October 31, 2013, the Fund’s open credit default swap agreements were as follows:

								Upfront
			Implied Credit					Premiums		Unrealized
			Spread at	Notional	Fixed			Paid/		Appreciation/
		Expiration	October 31,	Amount	Rate	Value		(Received)		(Depreciation)
Underlying Instrument	Counterparty	Date	2013 (%) (b)	($) (c)	(%)	($)		($)		($)
	JPMorgan Chase
Republic of Korea	Bank N.A.	6/20/18	0.54	5,500,000	1.00	(125,129	)	(65,689	)		(59,440	)
	JPMorgan Chase
Republic of Korea	Bank N.A.	6/20/18	0.54	7,000,000	1.00	(159,255	)	(45,513	)		(113,742	)
	JPMorgan Chase
Republic of Korea	Bank N.A.	6/20/18	0.54	7,000,000	1.00	(159,255	)	(59,599	)		(99,656	)
	JPMorgan Chase
Republic of Korea	Bank N.A.	6/20/18	0.54	6,000,000	1.00	(136,504	)	(77,634	)		(58,870	)
	Barclays Bank
Emirate of Abu Dhabi	PLC	6/20/18	0.57	4,400,000	1.00	(102,743	)	(72,021	)		(30,722	)
	Credit Suisse
Republic of Korea	International	6/20/18	0.54	6,000,000	1.00	(136,504	)	(63,927	)		(72,577	)
	JPMorgan Chase
CDX.EM 20	Bank N.A.	12/20/18	2.71	22,000,000	5.00	(2,449,465	)	(2,134,000	)		(315,465	)
	Barclays Bank
CDX.EM 20	PLC	12/20/18	2.71	17,000,000	5.00	(1,892,769	)	(1,681,725	)		(211,044	)
	Credit Suisse
CDX.EM 20	International	12/20/18	2.71	4,400,000	5.00	(489,893	)	(426,800	)		(63,093	)
	Credit Suisse
CDX.EM 20	International	12/20/18	2.71	11,000,000	5.00	(1,224,733	)	(1,083,500	)		(141,233	)
	Credit Suisse
CDX.EM 20	International	12/20/18	2.71	4,300,000	5.00	(478,759	)	(427,850	)		(50,909	)
	Credit Suisse
CDX.EM 20	International	12/20/18	2.71	4,400,000	5.00	(489,893	)	(435,600	)		(54,293	)
	JPMorgan Chase
Republic of Korea	Bank N.A.	9/20/17	0.39	100,000	1.00	(2,529	)	1,211			(3,740	)
	Barclays Bank
State of Qatar	PLC	9/20/17	0.49	6,250,000	1.00	(131,617	)	74,259			(205,876	)
Republic of the	JPMorgan Chase
Philippines	Bank N.A.	9/20/17	0.69	1,700,000	1.00	(29,627	)	38,756			(68,383	)
	JPMorgan Chase
Republic of Korea	Bank N.A.	9/20/17	0.42	5,000,000	1.00	(126,466	)	12,067			(138,533	)
	Barclays Bank
Republic of South Africa	PLC	12/20/17	1.61	3,500,000	1.00	80,253		93,237			(12,984	)
	JPMorgan Chase
Republic of Turkey	Bank N.A.	12/20/17	1.61	3,500,000	1.00	80,253		89,748			(9,495	)
						(7,974,635	)	(6,264,580	)		(1,710,055	)

See notes to financial statements. HSBC FAMILY OF FUNDS        33

HSBC TOTAL RETURN FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

Credit Default Swap Agreements - Sell Protection(a)

At October 31, 2013, the Fund’s open credit default swap agreements were as follows:

								Upfront
			Implied Credit					Premiums		Unrealized
			Spread at	Notional	Fixed			Paid/		Appreciation/
		Expiration	October 31,	Amount	Rate	Value		(Received)		(Depreciation)
Underlying Instrument	Counterparty	Date	2013 (%) (b)	($) (c)	(%)	($)		($)		($)
People’s Republic of	JPMorgan
China	Chase Bank N.A.	6/20/18	0.71	5,500,000	1.00	78,544		71,224			7,320
Federative Republic
of Brazil	Barclays Bank PLC	6/20/18	1.62	2,500,000	1.00	(65,410	)	(39,915	)		(25,495	)
Federative Republic	JPMorgan
of Brazil	Chase Bank N.A.	6/20/18	1.56	2,500,000	1.00	(65,341	)	(46,715	)		(18,626	)
Federative Republic	Credit Suisse
of Brazil	International	6/20/18	1.62	14,000,000	1.00	(365,907	)	(297,735	)		(68,172	)
People’s Republic	JPMorgan
of China	Chase Bank N.A.	6/20/18	0.71	6,000,000	1.00	85,685		83,678			2,007
People’s Republic	Credit Suisse
of China	International	6/20/18	0.71	6,000,000	1.00	85,685		37,634			48,051
Federative Republic	Credit Suisse
of Brazil	International	6/20/18	1.62	4,500,000	1.00	(117,613	)	(96,534	)		(21,079	)
	Credit Suisse
Republic of Indonesia	International	6/20/18	1.81	3,800,000	1.00	(117,923	)	(207,184	)		89,261
	JPMorgan
Republic of Indonesia	Chase Bank N.A.	9/20/18	1.81	500,000	1.00	(18,400	)	(26,156	)		7,756
	Credit Suisse
Republic of Indonesia	International	9/20/18	1.90	1,800,000	1.00	(66,239	)	(120,906	)		54,667
	JPMorgan Chase
Republic of South Africa	Bank N.A.	9/20/18	1.82	13,000,000	1.00	(472,588	)	(716,665	)		244,077
Federative Republic
of Brazil	Barclays Bank PLC	12/20/18	1.74	3,000,000	1.00	(101,390	)	(85,040	)		(16,350	)
Federative Republic	JPMorgan
of Brazil	Chase Bank N.A.	12/20/18	1.74	10,000,000	1.00	(337,965	)	(297,825	)		(40,140	)
	JPMorgan
Republic of Peru	Chase Bank N.A.	6/20/17	1.23	100,000	1.00	277		(3,224	)		3,501
Republic of Turkey	Barclays Bank PLC	12/20/17	1.61	3,500,000	1.00	(78,904	)	(88,148	)		9,244
	JPMorgan
Republic of South Africa	Chase Bank N.A.	12/20/17	1.61	3,500,000	1.00	(78,904	)	(99,897	)		20,993
						(1,636,393	)	(1,933,408	)		297,015

(a)	When a credit event occurs as defined under the terms of the swap agreement, the Fund as a seller of credit protection will either (i) pay to the buyer of protection an amount equal to the par value of the defaulted reference entity and take delivery of the reference entity or (ii) pay a net amount equal to the par value of the defaulted reference entity less its recovery value. Alternatively, the Fund as a buyer of credit protection will either (i) receive from the seller of protection an amount equal to the par value of the defaulted reference entity and deliver the reference entity to the seller or (ii) receive a net amount equal to the par value of the defaulted reference entity less its recovery value.
(b)	Implied credit spread, represented in absolute terms, utilized in determining the fair value of the credit default swap agreements as of period end serves as an indicator of the current status of the payment/performance risk and represents the likelihood or risk of default for the credit derivative. The implied credit spread of a referenced entity reflects the cost of buying/selling protection and may include upfront payments required to be made to enter into the agreement. Generally, wider credit spreads represent a perceived deterioration of the referenced entity’s credit soundness and a greater likelihood or risk of default or other credit event occurring as defined under the terms of the swap agreement.
(c)	The notional amount represents the maximum potential amount of future payments that the Fund may receive as a buyer of credit protection if a credit event occurs, as defined under the terms of the swap agreement. Alternatively, the notional amount represents the maximum potential amount the Fund could be required to make as a seller of credit protection if a credit event occurs, as defined under the terms of the swap agreement.

34        HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC TOTAL RETURN FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

At October 31, 2013, the Fund’s open forward foreign currency exchange contracts were as follows:

			Contract			Unrealized
			Amount	Contract		Appreciation/
		Delivery	(Local	Value	Value	(Depreciation)
Short Contracts	Counterparty	Date	Currency)	($)	($)	($)
Brazilian Real	Barclays Bank PLC	11/4/13	3,610,529	1,570,000	1,610,625		(40,625	)
Brazilian Real	Barclays Bank PLC	11/4/13	57,180,060	26,460,000	25,507,524		952,476
Brazilian Real	Barclays Bank PLC	2/4/13	57,180,060	25,705,835	24,964,278		741,557
Brazilian Real	Standard Chartered Bank	11/4/13	118,346,351	52,856,789	52,793,271		63,518
Chinese Yuan	Standard Chartered Bank	11/5/13	149,467,470	24,335,309	24,519,618		(184,309	)
European Euro	Barclays Bank PLC	12/16/13	3,153,421	4,341,000	4,281,403		59,597
European Euro	Barclays Bank PLC	12/16/13	20,844,319	27,760,109	28,300,347		(540,238	)
Hungarian Forint	Credit Suisse	12/18/13	5,788,628,234	25,975,446	26,522,256		(546,810	)
Hungarian Forint	Credit Suisse	12/18/13	1,103,756,280	5,151,000	5,057,175		93,825
Indian Rupee	Barclays Bank PLC	1/16/14	753,748,800	12,000,000	12,049,896		(49,896	)
Mexican Peso	Barclays Bank PLC	11/14/13	64,930,000	5,000,000	4,971,762		28,238
Mexican Peso	Barclays Bank PLC	11/14/13	320,000,000	25,647,191	24,502,756		1,144,435
Mexican Peso	Barclays Bank PLC	1/16/14	390,992,430	30,171,497	29,789,671		381,826
Mexican Peso	Credit Suisse	11/14/13	68,335,290	5,260,000	5,232,509		27,491
Mexican Peso	Standard Chartered Bank	11/14/13	257,727,140	20,120,000	19,734,454		385,546
Polish Zloty	Credit Suisse	12/20/13	89,477,438	28,112,805	28,970,248		(857,443	)
Polish Zloty	Standard Chartered Bank	11/5/13	54,127,120	17,802,046	17,574,491		227,555
South African Rand	Barclays Bank PLC	1/30/14	232,942,449	23,300,000	22,912,211		387,789
South African Rand	Standard Chartered Bank	12/9/13	459,369,099	46,693,341	45,544,630		1,148,711
Turkish Lira	Standard Chartered Bank	1/15/14	29,271,719	14,572,469	14,475,656		96,813
				422,834,837	419,314,781		3,520,056

			Contract			Unrealized
			Amount	Contract		Appreciation/
		Delivery	(Local	Value	Value	(Depreciation)
Long Contracts	Counterparty	Date	Currency)	($)	($)	($)
Brazilian Real	Barclays Bank PLC	11/4/13	16,954,525	6,970,000	7,563,265		593,265
Brazilian Real	Barclays Bank PLC	11/4/13	57,180,060	26,253,471	25,507,524		(745,947	)
Brazilian Real	Standard Chartered Bank	11/4/13	105,002,355	44,719,913	46,840,631		2,120,718
Brazilian Real	Standard Chartered Bank	2/4/14	118,346,351	51,801,782	51,668,908		(132,874	)
Chilean Peso	Credit Suisse	12/18/13	6,611,932,000	13,040,000	12,824,649		(215,351	)
Chinese Yuan	Standard Chartered Bank	11/5/13	149,467,470	24,113,490	24,519,618		406,128
Chinese Yuan	Standard Chartered Bank	2/20/14	149,467,470	24,313,537	24,435,537		122,000
Indian Rupee	Standard Chartered Bank	1/16/14	768,454,000	11,177,512	12,284,982		1,107,470
Mexican Peso	Barclays Bank PLC	11/14/13	390,992,430	30,321,243	29,938,726		(382,517	)
Mexican Peso	Standard Chartered Bank	1/16/14	283,464,056	20,966,276	21,597,096		630,820
Polish Zloty	Credit Suisse	2/4/14	33,577,600	10,924,874	10,842,940		(81,934	)
Polish Zloty	JPMorgan Chase Bank N.A.	12/20/13	1,401,980	445,361	453,921		8,560
Polish Zloty	Standard Chartered Bank	2/4/14	54,127,120	17,704,222	17,478,828		(225,394	)
Russian Ruble	Standard Chartered Bank	2/6/14	3,999,150	121,675	122,748		1,073
South African Rand	Credit Suisse	12/9/13	457,920,605	44,736,284	45,401,017		664,733
South African Rand	Standard Chartered Bank	12/9/13	1,448,494	145,867	143,612		(2,255	)
South African Rand	Standard Chartered Bank	1/30/14	459,369,099	46,330,720	45,183,528		(1,147,192	)
Turkish Lira	Barclays Bank PLC	1/15/14	19,280,408	9,604,667	9,534,683		(69,984	)
Turkish Lira	Standard Chartered Bank	1/15/14	10,416,319	5,213,373	5,151,151		(62,222	)
				388,904,267	391,493,364		2,589,097

See notes to financial statements. HSBC FAMILY OF FUNDS        35

HSBC RMB FIXED INCOME FUND

Schedule of Portfolio Investments—as of October 31, 2013

Foreign Bonds – 86.5%†
	Principal
	Amount ($)	Value ($)
Australia – 2.4%
Australia & New Zealand Banking
Group Ltd., Series E,
2.90%, 8/14/15, MTN (a)	2,000,000	330,039
Brazil – 2.3%
Banco BTG Pactual SA, Series G,
4.10%, 3/26/16, MTN (a)	2,000,000	322,854
China – 33.2%
Baosteel Group Corp. Ltd.,
Registered, 4.15%, 3/1/17 (a)	2,000,000	333,865
Beijing Enterprises Water Group Ltd.,
3.75%, 6/30/14 (a)	3,000,000	492,204
Big Will Investments Ltd., Registered,
7.00%, 4/29/14 (a)	2,000,000	332,561
Bitronic Ltd., 4.00%, 12/12/15 (a)	3,000,000	492,185
China Guangdong Nuclear Power
Holding Co. Ltd., Registered,
3.75%, 11/1/15 (a)	2,000,000	329,741
China Shanshui Cement Group Ltd.,
6.50%, 7/22/14 (a)	2,000,000	331,718
Huaneng Power International, Inc.,
3.85%, 2/5/16 (a)	2,000,000	328,982
ICBC Luxembourg SA,
2.60%, 5/28/14	2,000,000	328,617
Intime Department Store
(Group) Co. Ltd., Registered,
4.65%, 7/21/14 (a)	2,000,000	328,526
Kaisa Group Holdings Ltd.,
6.88%, 4/22/16	2,000,000	328,618
New World China Land Ltd.,
8.50%, 4/11/15 (a)	2,000,000	347,819
Right Century Ltd.,
1.85%, 6/3/14 (a)	2,000,000	325,366
The Export-Import Bank of China,
2.70%, 4/7/14 (a)	2,000,000	328,323
		4,628,525
France – 3.6%
Veolia Environnement SA, Series E,
4.50%, 6/28/17, MTN (a)	3,000,000	504,747
Germany – 1.2%
BSH Bosch und Siemens
Hausgerate GmbH, Registered,
3.80%, 7/24/17 (a)	1,000,000	165,977
Hong Kong – 31.9%
BECL Investment Holding Ltd.,
4.75%, 2/21/14 (a)	3,000,000	493,308
China Resources Power
Holdings Co. Ltd., Series A,
2.90%, 11/12/13 (a)	2,000,000	328,247
Dorsett Hospitality
International Ltd., Series E,
6.00%, 4/3/18, MTN (a)	2,000,000	320,662
Eastern Air Overseas (Hong Kong)
Corp. Ltd., 4.00%, 8/8/14 (a)	2,000,000	328,361
Galaxy Entertainment Group Ltd.,
4.63%, 12/16/13 (a)	3,000,000	492,295
Gemdale International Holdings Ltd.,
9.15%, 7/26/15 (a)	2,000,000	347,905
Lafarge Shui On Cement Ltd.,
Registered, 9.00%, 11/14/14 (a)	2,000,000	343,853
Lai Fung Holdings Ltd.,
6.88%, 4/25/18	2,000,000	318,296
Noble Group Ltd., Series E,
4.00%, 1/30/16, MTN	1,000,000	164,396
Rainbow Days Ltd., Registered,
3.00%, 6/30/16 (a)	2,000,000	321,767
Silvery Castle Ltd.,
2.75%, 7/14/14 (a)	2,000,000	326,411
Singamas Container Holdings Ltd.,
Registered, 4.75%, 4/14/14 (a)	2,000,000	327,901
SK Global Chemical Co. Ltd.,
4.13%, 9/26/16	2,000,000	332,791
		4,446,193
Japan – 2.4%
Mitsui & Co. Ltd., Series E,
4.25%, 3/1/17, MTN (a)	2,000,000	334,985
Singapore – 2.4%
Global Logistic Properites Ltd.,
Registered, 3.38%, 5/11/16 (a)	2,000,000	327,379
South Korea – 2.4%
The Korea Development
Bank, Series E,
2.75%, 11/14/13, MTN (a)	2,000,000	328,302
United States – 4.7%
Caterpillar Financial Services Corp.,
Registered, 3.35%, 11/26/14	2,000,000	329,667
Yum! Brands, Inc., Registered,
2.38%, 9/29/14 (a)	2,000,000	325,713
		655,380
TOTAL FOREIGN BONDS
(COST $11,542,590)		12,044,381
Certificates of Deposit – 10.6%
China – 4.7%
China Construction Bank (Asia)
Corp. Ltd., Series FXCD,
2.75%, 3/11/14	2,000,000	329,206
China Development Bank Corp.,
2.90%, 6/25/14 (a)	2,000,000	329,442
		658,648
Japan – 2.4%
Sumitomo Mitsui Banking Corp.,
1.10%, 4/22/14 (a)	2,000,000	325,497
Singapore – 3.5%
Oversea-Chinese Banking Corp. Ltd.,
1.10%, 3/28/14 (a)	3,000,000	488,394
TOTAL CERTIFICATES OF DEPOSIT
(COST $1,413,124)		1,472,539

36        HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC RMB FIXED INCOME FUND

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

Investment Companies – 1.2%
	Shares	Value ($)
Northern Institutional Diversified
Assets Portfolio, Institutional
Shares, 0.01% (b)	168,744	168,744
TOTAL INVESTMENT COMPANIES
(COST $168,744)		168,744
TOTAL INVESTMENT SECURITIES
(COST $13,124,458) — 98.3%		13,685,664

____________________
 

Percentages indicated are based on net assets of $13,925,855.
†	The principal amount is disclosed in local currency and the value is disclosed in U.S. Dollars.
(a)	Variable rate security. The interest rates on these securities are adjusted periodically to reflect then-current short-term interest rates. The rates presented represent the rates in effect on October 31, 2013. The maturity dates presented reflect the final maturity dates. However, some of these securities may contain put or demand features that allow the Fund to require the issuer to repurchase the security from the fund within various time periods, including daily, weekly, monthly, or semi-annually.
(b)	The rate represents the annualized one-day yield that was in effect on October 31, 2013.
MTN — Medium Term Note

The Fund invested, as a percentage of net assets at value, in the following industries, as of October 31, 2013:

	Percentage of Net Assets
Industry	at Value (%)
Diversified Financial Services		56.8
Commercial Banks		9.5
Energy Equipment & Services		8.3
Construction Materials		4.8
Industrial Conglomerates		4.8
Specialty Retail		4.7
Diversified Telecommunication Services		3.5
Oil, Gas & Consumable Fuels		2.4
Diversified Consumer Services		2.3
Investment Companies		1.2
		98.3

See notes to financial statements. HSBC FAMILY OF FUNDS       37

HSBC FAMILY OF FUNDS

Statements of Assets and Liabilities – as of October 31, 2013

		Emerging			Emerging			Frontier			Total			RMB Fixed
		Markets			Markets Local			Markets			Return			Income
		Debt Fund			Debt Fund			Fund			Fund			Fund
Assets:
	Investments securities, at value		$	42,500,543		$	30,003,535		$	87,051,820		$	643,376,279		$	13,685,664
	Cash			—			—			—			—			—
	Segregated cash for collateral			—			350,000			—			9,510,000			—
	Segregated cash with brokers			39,410			—			—			651,162			—
	Foreign currency, at value			14,915			509,779			208,277			75,740			59,325
	Unrealized appreciation on forward foreign currency
	exchange contracts			23,061			650,894			—			11,394,144			—
	Unrealized appreciation on swap agreements			36,270			61,749			—			1,231,923			—
	Interest and dividends receivable			463,376			297,658			101,810			6,919,565			135,969
	Premiums paid on swap agreements			—			—			—			501,814			—
	Receivable for capital shares issued			49,345			6,125			1,084,921			3,122,300			19,058
	Receivable for investments sold			—			—			809,566			17,768,440			—
	Reclaims receivable			—			48,332			513			113,838			—
	Receivable from Investment Adviser			—			7,890			—			—			31,058
	Variation margin on futures contracts			—			—			—			55,625			—
	Prepaid expenses			11,850			16,653			15,307			16,975			19,127
	Total Assets			43,138,770			31,952,615			89,272,214			694,737,805			13,950,201
Liabilities:
	Cash overdraft			—			420,000			—			5,710,000			—
	Dividends payable			1,318			3,734			—			592,068			1,720
	Unrealized depreciation on forward foreign currency
	exchange contracts			9,034			314,430			—			5,284,991			—
	Unrealized depreciation on swap agreements			3,254			213,103			—			3,363,797			—
	Payable for investments purchased			845,587			—			475,775			1,113,550			—
	Premiums received on swap agreements			38,019			—			—			8,700,555			—
	Payable for capital shares redeemed			12,831			5,611			36,779			1,703,138			—
	Variation margin on futures contracts			3,281			—			—			—			—
	Accrued expenses and other liabilities:
	Investment Management			8,173			—			29,333			533,935			—
	Administration			1,765			1,316			3,562			28,153			587
	Shareholder Servicing			840			677			7,223			456			865
	Compliance Services			12			6			46			115			2
	Accounting			156			293			908			—			207
	Custodian			5,300			19,401			78,514			31,396			3,100
	Transfer Agent			5,304			4,627			4,751			42,798			4,574
	Trustee			125			70			753			1,685			42
	Other			14,711			12,847			19,439			59,500			13,249
	Total Liabilities			949,710			996,115			657,083			27,166,137			24,346
Net Assets			$	42,189,060		$	30,956,500		$	88,615,131		$	667,571,668		$	13,925,855

38       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC FAMILY OF FUNDS

Statements of Assets and Liabilities – as of October 31, 2013 (continued)

	Emerging			Emerging				Frontier			Total				RMB Fixed
	Markets			Markets Local				Markets			Return				Income
	Debt Fund			Debt Fund				Fund			Fund				Fund
Composition of Net Assets:
Capital			41,068,845			33,121,550				81,840,775			671,343,424				13,293,503
Accumulated net investment income (loss)			11,283			(497,249	)			286,049			187,549				70,399
Accumulated net realized gains (losses)
from investments			613,573			58,409				2,548,653			4,704,355				332
Unrealized appreciation/depreciation on investments			495,359			(1,726,210	)			3,939,654			(8,663,660	)			561,621
Net Assets		$	42,189,060		$	30,956,500			$	88,615,131		$	667,571,668			$	13,925,855
Net Assets:
Class A Shares		$	1,041,546		$	1,365,967			$	18,341,837		$	268,071			$	2,959,277
Class I Shares			41,026,852			29,493,174				70,273,294			642,545,191				10,856,479
Class S Shares			120,662			97,359				—			24,758,406				110,099
		$	42,189,060		$	30,956,500			$	88,615,131		$	667,571,668			$	13,925,855
Shares Outstanding
($0.001 par value, unlimited number of
shares authorized):
Class A Shares			99,975			149,312				1,404,556			26,459				281,217
Class I Shares			3,928,862			3,220,036				5,345,660			63,318,758				1,030,789
Class S Shares			11,554			10,629				—			2,439,597				10,453
Net Asset Value, Offering Price and Redemption Price
per share:
Class A Shares		$	10.42		$	9.15			$	13.06		$	10.13			$	10.52
Class I Shares		$	10.44		$	9.16			$	13.15		$	10.15			$	10.53
Class S Shares		$	10.44		$	9.16			$	—		$	10.15			$	10.53
Maximum Sales Charge - Class A Shares			4.75%			4.75%				5.00%			4.75%				4.75%
Maximum Offering Price per share (Net Asset Value/
(100%-maximum sales charge)) - Class A Shares		$	10.94		$	9.61			$	13.75		$	10.64			$	11.04
Total Investments, at cost		$	42,145,028		$	31,906,057			$	83,113,796		$	654,317,612			$	13,124,458
Foreign currency, at cost		$	13,617		$	514,401			$	207,346		$	74,670			$	59,355

See notes to financial statements. HSBC FAMILY OF FUNDS       39

HSBC FAMILY OF FUNDS

Statements of Operations—For the period ended October 31, 2013

					Emerging												RMB
	Emerging				Markets				Frontier				Total				Fixed
	Markets				Local Debt				Markets				Return				Income
	Debt Fund				Fund				Fund				Fund				Fund
Investment Income:
Interest		$	2,043,333			$	1,236,180			$	22,882			$	13,168,129			$	574,419
Dividends			137				937				1,236,409				13,903				27
Foreign tax withholding			—				(34,666	)			(95,322	)			—				(439	)
Total Investment Income			2,043,470				1,202,451				1,163,969				13,182,032				574,007
Expenses:
Investment Management			202,403				161,481				481,999				4,431,150				71,617
Advisory Services:
Operational Support - Class A Shares			1,265				3,290				15,035				501				4,836
Operational Support - Class I Shares			39,726				30,551				31,042				510,246				10,497
Administration:
Class A Shares			315				816				3,764				124				1,213
Class I Shares			19,761				15,198				15,477				253,951				5,272
Class S Shares			61				50				—				5,457				54
Shareholder Servicing:
Class A Shares			1,514				4,037				18,376				502				5,932
Accounting			65,357				57,982				61,278				68,996				56,953
Audit			20,614				20,614				21,797				14,842				20,590
Compliance Services			822				645				699				10,041				225
Custodian			20,324				65,439				217,379				157,208				12,359
Printing			6,263				7,683				3,329				151,363				2,058
Transfer Agent			31,672				27,875				27,339				367,313				28,803
Trustee			2,587				2,050				2,520				28,813				796
Registration fees			36,360				34,460				30,249				72,723				57,972
Other			9,521				7,726				14,916				111,277				3,346
Total expenses before fee reductions			458,565				439,897				945,199				6,184,507				282,523
Fees contractually reduced/reimbursed by
Investment Adviser			(112,179	)			(159,629	)			(201,653	)			—				(130,790	)
Net Expenses			346,386				280,268				743,546				6,184,507				151,733
Net Investment Income (Loss)			1,697,084				922,183				420,423				6,997,525				422,274
Net Realized/Unrealized Gains (Losses) from Investments:
Net realized gains (losses) from investment securities and
foreign currency transactions			589,578				(382,267	)			3,094,156				330,752				59,668
Net realized gains (losses) from swap agreements			38,683				(70,319	)			—				1,995,299				—
Net realized gains (losses) from futures transactions			(52,363	)			—				—				2,792,335				—
Net realized gains (losses) from options transactions			—				(21,251	)			—				(12,985	)			—
Net realized gains (losses) from forward foreign currency
exchange contracts			39,161				(67,998	)			(37,785	)			(3,376,735	)			863
Change in unrealized appreciation/depreciation on investments			(3,278,914	)			(1,801,503	)			2,477,159				(11,628,547	)			303,021
Net realized/unrealized gains (losses) from investments			(2,663,855	)			(2,343,338	)			5,533,530				(9,899,881	)			363,552
Change In Net Assets Resulting From Operations		$	(966,771	)		$	(1,421,155	)		$	5,953,953			$	(2,902,356	)		$	785,826

40       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC FAMILY OF FUNDS

Statements of Changes in Net Assets

	Emerging Markets Debt Fund								Emerging Markets Local Debt Fund
	For the				For the				For the				For the
	year ended				year ended				year ended				year ended
	October 31,				October 31,				October 31,				October 31,
	2013				2012				2013				2012
Investment Activities:
Operations:
Net investment income (loss)		$	1,697,084			$	1,753,907			$	922,183			$	696,005
Net realized gains (losses) from investments			615,059				990,534				(541,835	)			(19,291	)
Change in unrealized appreciation/depreciation
from investments			(3,278,914	)			3,109,845				(1,801,503	)			986,694
Change in net assets resulting from operations			(966,771	)			5,854,286				(1,421,155	)			1,663,408
Dividends:
Net investment income:
Class A Shares			(28,486	)			(18,843	)			(31,726	)			(19,827	)
Class I Shares			(1,845,859	)			(1,790,370	)			(710,776	)			(364,422	)
Class S Shares			(5,796	)			(5,580	)			(2,435	)			(1,447	)
Net realized gains:
Class A Shares			(9,441	)			(82	)			(10,809	)			—
Class I Shares			(772,828	)			(7,859	)			(163,733	)			—
Class S Shares			(2,419	)			(24	)			(546	)			—
Return of capital:
Class A Shares			—				—				(2,645	)			—
Class I Shares			—				—				(59,258	)			—
Class S Shares			—				—				(203	)			—
Change in net assets resulting from shareholder dividends			(2,664,829	)			(1,822,758	)			(982,131	)			(385,696	)
Change in net assets resulting from capital transactions			5,464,579				1,607,083				603,018				5,488,843
Change in Net Assets			1,832,979				5,638,611				(1,800,268	)			6,766,555
Net Assets:
Beginning of period			40,356,081				34,717,470				32,756,768				25,990,213
End of period		$	42,189,060			$	40,356,081			$	30,956,500			$	32,756,768
Accumulated net investment income (loss)		$	11,283			$	156,381			$	(497,249	)		$	(98,794	)

See notes to financial statements. HSBC FAMILY OF FUNDS       41

HSBC FAMILY OF FUNDS

Statements of Changes in Net Assets (continued)

	Emerging Markets Debt Fund								Emerging Markets Local Debt Fund
	For the				For the				For the				For the
	year ended				year ended				year ended				year ended
	October 31,				October 31,				October 31,				October 31,
	2013				2012				2013				2012
CAPITAL TRANSACTIONS:
Class A Shares:
Proceeds from shares issued		$	844,418			$	114,676			$	73,088			$	317,157
Dividends reinvested			36,938				18,862				45,180				19,823
Value of shares redeemed			(279,434	)			(53,069	)			(696,802	)			(165,752	)
Class A Shares capital transactions			601,922				80,469				(578,534	)			171,228
Class I Shares:
Proceeds from shares issued			5,475,189				4,722,544				2,185,689				5,310,513
Dividends reinvested			2,599,125				1,789,564				915,562				363,845
Value of shares redeemed			(3,219,872	)			(4,991,098	)			(1,922,883	)			(358,190	)
Class I Shares capital transactions			4,854,442				1,521,010				1,178,368				5,316,168
Class S Shares:
Proceeds from shares issued			—				—				—				39
Dividends reinvested			8,215				5,604				3,184				1,447
Value of shares redeemed			—				—				—				(39	)
Class S Shares capital transactions			8,215				5,604				3,184				1,447
Change in net assets resulting from capital transactions		$	5,464,579			$	1,607,083			$	603,018			$	5,488,843
SHARE TRANSACTIONS:
Class A Shares:
Issued			79,794				10,704				7,292				34,067
Reinvested			3,422				1,763				4,760				2,080
Redeemed			(25,425	)			(4,945	)			(70,968	)			(17,278	)
Change in Class A Shares			57,791				7,522				(58,916	)			18,869
Class I Shares:
Issued			514,194				439,010				224,421				577,774
Reinvested			236,733				167,373				96,859				38,045
Redeemed			(296,599	)			(475,609	)			(201,361	)			(37,005	)
Change in Class I Shares			454,328				130,774				119,919				578,814
Class S Shares:
Issued			—				—				—				4
Reinvested			748				524				337				151
Redeemed			—				—				—				(4	)
Change in Class S Shares			748				524				337				151

42      HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC FAMILY OF FUNDS

Statements of Changes in Net Assets (continued)

	Frontier Markets Fund								Total Return Fund
	For the				For the				For the				For the
	year ended				year ended				year ended				period ended
	October 31,				October 31,				October 31,				October 31,
	2013				2012				2013				2012(a)
Investment Activities:
Operations:
Net investment income (loss)		$	420,423			$	430,206			$	6,997,525			$	897,423
Net realized gains (losses) from investments			3,056,371				(304,677	)			1,728,666				1,650,456
Change in unrealized appreciation/depreciation on investments			2,477,159				1,859,842				(11,628,547	)			2,964,887
Change in net assets resulting from operations			5,953,953				1,985,371				(2,902,356	)			5,512,766
Dividends:
Net investment income:
Class A Shares			(55,553	)			(102	)			(1,371	)			(872	)
Class I Shares			(594,074	)			(28,979	)			(4,173,501	)			(1,117,289	)
Class S Shares			—				—				(100,910	)			(566	)
Net realized gains:
Class A Shares			—				—				(687	)			—
Class I Shares			—				—				(994,711	)			—
Class S Shares			—				—				(273	)			—
Change in net assets resulting from shareholder dividends			(649,627	)			(29,081	)			(5,271,453	)			(1,118,727	)
Change in net assets resulting from capital transactions			65,526,260				1,324,387				326,942,558				344,408,880
Change in Net Assets			70,830,586				3,280,677				318,768,749				348,802,919
Net Assets:
Beginning of period			17,784,545				14,503,868				348,802,919				—
End of period		$	88,615,131			$	17,784,545			$	667,571,668			$	348,802,919
Accumulated net investment income (loss)		$	286,049			$	568,629			$	187,549			$	209,007

____________________
 

(a)      Commenced operations on March 30, 2012.

See notes to financial statements. HSBC FAMILY OF FUNDS       43

HSBC FAMILY OF FUNDS

Statements of Changes in Net Assets (continued)

	Frontier Markets Fund								Total Return Fund
	For the				For the				For the				For the
	year ended				year ended				year ended				period ended
	October 31,				October 31,				October 31,				October 31,
	2013				2012				2013				2012(a)
CAPITAL TRANSACTIONS:
Class A Shares:
Proceeds from shares issued		$	20,178,523			$	1,295,654			$	128,377			$	251,147
Dividends reinvested			54,520				102				1,907				858
Value of shares redeemed			(4,091,405	)			(348	)			(115,220	)			—
Class A Shares capital transactions			16,141,638				1,295,408				15,064				252,005
Class I Shares:
Proceeds from shares issued			50,334,400				—				557,303,774				355,170,152
Dividends reinvested			594,074				28,979				212,870				53,217
Value of shares redeemed			(1,543,852	)			—				(255,586,928	)			(11,167,060	)
Class I Shares capital transactions			49,384,622				28,979				301,929,716				344,056,309
Class S Shares:
Proceeds from shares issued			—				—				25,001,000				100,000
Dividends reinvested			—				—				101,183				566
Value of shares redeemed			—				—				(104,405	)			—
Class S Shares capital transactions			—				—				24,997,778				100,566
Change in net assets resulting from capital transactions		$	65,526,260			$	1,324,387			$	326,942,558			$	344,408,880
SHARE TRANSACTIONS:
Class A Shares:
Issued			1,601,677				118,945				12,697				24,776
Reinvested			5,020				11				186				84
Redeemed			(331,062	)			(35	)			(11,284	)			—
Change in Class A Shares			1,275,635				118,921				1,599				24,860
Class I Shares:
Issued			3,918,149				—				54,781,199				34,798,480
Reinvested			54,502				3,150				20,907				5,198
Redeemed			(120,141	)			—				(25,200,517	)			(1,086,509	)
Change in Class I Shares			3,852,510				3,150				29,601,589				33,717,169
Class S Shares:
Issued			—				—				2,429,641				10,000
Reinvested			—				—				10,078				55
Redeemed			—				—				(10,177	)			—
Change in Class S Shares			—				—				2,429,542				10,055

____________________
 

(a) Commenced operations on March 30, 2012.

44       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC FAMILY OF FUNDS

Statements of Changes in Net Assets (continued)

	RMB Fixed Income Fund
	For the				For the
	year ended				period ended
	October 31,				October 31,
	2013				2012(b)
Investment Activities:
Operations:
Net investment income (loss)		$	422,274			$	104,312
Net realized gains (losses) from investments			60,531				9,607
Change in unrealized appreciation/depreciation on investments			303,021				258,600
Change in net assets resulting from operations			785,826				372,519
Dividends:
Net investment income:
Class A Shares			(75,699	)			(9,438	)
Class I Shares			(359,216	)			(87,437	)
Class S Shares			(3,758	)			(926	)
Net realized gains:
Class A Shares			(1	)			—
Class I Shares			(6	)			—
Class S Shares			—(c	)			—
Change in net assets resulting from shareholder dividends			(438,680	)			(97,801	)
Change in net assets resulting from capital transactions			1,811,342				11,492,649
Change in Net Assets			2,158,488				11,767,367
Net Assets:
Beginning of period			11,767,367				—
End of period		$	13,925,855			$	11,767,367
Accumulated net investment income (loss)		$	70,399			$	26,606

____________________
(b)	Commenced operations on June 8, 2012.
(c)	Amount is less than $0.50.

See notes to financial statements. HSBC FAMILY OF FUNDS       45

HSBC FAMILY OF FUNDS

Statements of Changes in Net Assets (continued)

	RMB Fixed Income Fund
	For the				For the
	year ended				period ended
	October 31,				October 31,
	2013				2012(b)
CAPITAL TRANSACTIONS:
Class A Shares:
Proceeds from shares issued		$	1,338,025			$	1,496,245
Dividends reinvested			62,209				8,041
Value of shares redeemed			(31,872	)			—
Class A Shares capital transactions			1,368,362				1,504,286
Class I Shares:
Proceeds from shares issued			80,000				9,800,000
Dividends reinvested			359,222				87,437
Value of shares redeemed			—				—
Class I Shares capital transactions			439,222				9,887,437
Class S Shares:
Proceeds from shares issued			—				100,000
Dividends reinvested			3,758				926
Value of shares redeemed			—				—
Class S Shares capital transactions			3,758				100,926
Change in net assets resulting from capital transactions		$	1,811,342			$	11,492,649
SHARE TRANSACTIONS:
Class A Shares:
Issued			128,908				148,592
Reinvested			5,986				792
Redeemed			(3,061	)			—
Change in Class A Shares			131,833				149,384
Class I Shares:
Issued			7,625				980,000
Reinvested			34,545				8,619
Redeemed			—				—
Change in Class I Shares			42,170				988,619
Class S Shares:
Issued			—				10,000
Reinvested			362				91
Redeemed			—				—
Change in Class S Shares			362				10,091
____________________
(b)       Commenced operations on June 8, 2012.

46       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC EMERGING MARKETS DEBT FUND

FinancialHighlights

Selected data for a share outstandingthroughout the periodsindicated.

				InvestmentActivities							Dividends											Ratios/Supplementary Data
	Net Asset Value, Beginning of Period			Net Investment Income (Loss)	Net Realized and Unrealized Gains (Losses) from Investments			Total from Investment Activities			Net Investment Income	Net Realized Gains from Investment Transactions			Total Dividends	Net Asset Value, End of Period			Total Return(a)			Net Assets at End of Period (000’s)		Ratio of Net Expenses to Average Net Assets(b)	Ratio of Net Investment Income (Loss) to Average Net Assets(b)	Ratios of Expenses to Average Net Assets (Excluding Fee Reductions)(b)	Portfolio Turnover (a)(c)
CLASS A SHARES
Period Ended October 31, 2011(d)		$	10.00	0.25		0.25			0.50		(0.27)		—		(0.27)		$	10.23		5.02	%		$355	1.20%	4.81%	1.38%	10%
Year Ended October 31, 2012		$	10.23	0.47		1.21			1.68		(0.49)		—	(e)	(0.49)		$	11.42		16.90	%		$482	1.20%	4.32%	1.55%	54%
Year Ended October 31, 2013		$	11.42	0.43		(0.74	)		(0.31	)	(0.47)		(0.22	)	(0.69)		$	10.42		(2.84	)%		$1,042	1.20%	3.92%	1.48%	53%
CLASS I SHARES
Period Ended October 31, 2011(d)		$	10.00	0.29		0.24			0.53		(0.28)		—		(0.28)		$	10.25		5.34	%		$34,257	0.85%	5.07%	1.12%	10%
Year Ended October 31, 2012		$	10.25	0.51		1.20			1.71		(0.52)		—	(e)	(0.52)		$	11.44		17.19	%		$39,751	0.85%	4.68%	1.28%	54%
Year Ended October 31, 2013		$	11.44	0.45		(0.72	)		(0.27	)	(0.51)		(0.22	)	(0.73)		$	10.44		(2.52	)%		$41,027	0.85%	4.19%	1.13%	53%
CLASS S SHARES
Period Ended October 31, 2011(d)		$	10.00	0.30		0.23			0.53		(0.28)		—		(0.28)		$	10.25		5.39	%		$105	0.75%	5.14%	1.02%	10%
Year Ended October 31, 2012		$	10.25	0.52		1.20			1.72		(0.53)		—	(e)	(0.53)		$	11.44		17.30	%		$124	0.75%	4.78%	1.18%	54%
Year Ended October 31, 2013		$	11.44	0.47		(0.73	)		(0.26	)	(0.52)		(0.22	)	(0.74)		$	10.44		(2.42	)%		$121	0.75%	4.29%	1.03%	53%

(a)	Not annualized for periods less than one year. Total return calculations do not include any redemption charges.
(b)	Annualized for periods less than one year.
(c)	Portfolio turnover rate is calculated on the basis of the Fund as a whole without the distinguishing between the classes of shares issued.
(d)	Commenced operations on April 7, 2011.
(e)	Represents less than $0.005 or $(0.005).

See notes to financial statements. HSBC FAMILY OF FUNDS       47

HSBC EMERGING MARKETS LOCAL DEBT FUND

FinancialHighlights

Selected data for a share outstandingthroughout the periodsindicated.

			InvestmentActivities									Dividends														Ratios/Supplementary Data
	Net Asset Value, Beginning of Period		Net Investment Income (Loss)			Net Realized and Unrealized Gains (Losses) from Investments			Total from Investment Activities			Net Investment Income	Net Realized Gains from Investment Transactions			Return of Capital			Total Dividends	Net Asset Value, End of Period			Total Return(a)			Net Assets at End of Period (000’s)		Ratio of Net Expenses to Average Net Assets(b)	Ratio of Net Investment Income (Loss) to Average Net Assets(b)	Ratios of Expenses to Average Net Assets (Excluding Fee Reductions)(b)	Portfolio Turnover (a)(c)
CLASS A SHARES
Period Ended October 31, 2011(d)		$10.00		0.12			(0.46	)		(0.34	)	(0.09)		—			(0.03	)	(0.12)		$	9.54		(3.43	)%		$1,807	1.20%	2.29%	1.66%	66%
Year Ended October 31, 2012		$9.54		0.21			0.21			0.42		(0.10)		—			—		(0.10)		$	9.86		4.47	%		$2,053	1.20%	2.13%	1.94%	43%
Year Ended October 31, 2013		$9.86		0.24	(e)		(0.69	)		(0.45	)	(0.19)		(0.05	)		(0.02	)	(0.26)		$	9.15		(4.60	)%		$1,366	1.20%	2.49%	1.69%	86%
CLASS I SHARES
Period Ended October 31, 2011(d)		$10.00		0.13			(0.45	)		(0.32	)	(0.10)		—			(0.03	)	(0.13)		$	9.55		(3.21	)%		$24,086	0.85%	2.46%	1.32%	66%
Year Ended October 31, 2012		$9.55		0.24			0.21			0.45		(0.13)		—			—		(0.13)		$	9.87		4.80	%		$30,602	0.85%	2.47%	1.62%	43%
Year Ended October 31, 2013		$9.87		0.28	(e)		(0.70	)		(0.42	)	(0.22)		(0.05	)		(0.02	)	(0.29)		$	9.16		(4.25	)%		$29,493	0.85%	2.87%	1.34%	86%
CLASS S SHARES
Period Ended October 31, 2011(d)		$10.00		0.14			(0.45	)		(0.31	)	(0.11)		—			(0.03	)	(0.14)		$	9.55		(3.16	)%		$97	0.75%	2.58%	1.22%	66%
Year Ended October 31, 2012		$9.55		0.25			0.21			0.46		(0.14)		—			—		(0.14)		$	9.87		4.89	%		$102	0.75%	2.59%	1.51%	43%
Year Ended October 31, 2013		$9.87		0.29	(e)		(0.70	)		(0.41	)	(0.23)		(0.05	)		(0.02	)	(0.30)		$	9.16		(4.16	)%		$97	0.75%	2.97%	1.24%	86%

(a)	Not annualized for periods less than one year. Total return calculations do not include any redemption charges.
(b)	Annualized for periods less than one year.
(c)	Portfolio turnover rate is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.
(d)	Commenced operations on April 7, 2011.
(e)	Calculated based on average shares outstanding.

48       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC FRONTIER MARKETS FUND

FinancialHighlights

Selected data for a share outstandingthroughout the periodsindicated.

			InvestmentActivities									Dividends											Ratios/Supplementary Data
	Net Asset Value, Beginning of Period		Net Investment Income (Loss)			Net Realized and Unrealized Gains (Losses) from Investments			Total from Investment Activities			Net Investment Income			Total Dividends			Net Asset Value, End of Period		Total Return(a)			Net Assets at End of Period (000’s)		Ratio of Net Expenses to Average Net Assets(b)	Ratio of Net Investment Income (Loss) to Average Net Assets(b)			Ratios of Expenses to Average Net Assets (Excluding Fee Reductions)(b)	Portfolio Turnover (a)(c)
CLASS A SHARES
Period Ended October 31, 2011(d)		$10.00		—	(e)		(0.34	)		(0.34	)		—			—			$9.66		(3.40	)%		$97	2.30%		(0.26	)%	2.57%		6	%
Year Ended October 31, 2012		$9.66		0.16	(f)		1.12			1.28			(0.01	)		(0.01	)		$10.93		13.27	%		$1,409	2.20%		1.51	%	3.79%		26	%
Year Ended October 31, 2013		$10.93		0.08	(f)		2.45			2.53			(0.40	)		(0.40	)		$13.06		23.85	%		$18,342	2.20%		0.60	%	2.69%		44	%
CLASS I SHARES
Period Ended October 31, 2011(d)		$10.00		—	(e)		(0.33	)		(0.33	)		—			—			$9.67		(3.30	)%		$14,407	1.96%		0.09	%	2.23%		6	%
Year Ended October 31, 2012		$9.67		0.29	(f)		1.03			1.32			(0.02	)		(0.02	)		$10.97		13.68	%		$16,375	1.85%		2.83	%	2.79%		26	%
Year Ended October 31, 2013		$10.97		0.15	(f)		2.43			2.58			(0.40	)		(0.40	)		$13.15		24.25	%		$70,273	1.85%		1.20	%	2.38%		44	%

(a)	Not annualized for periods less than one year. Total return calculations do not include any redemption charges.
(b)	Annualized for periods less than one year.
(c)	Portfolio turnover rate is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.
(d)	Commenced operations on September 6, 2011.
(e)	Represents less than $0.005 or $(0.005).
(f)	Calculated based on average shares outstanding.

See notes to financial statements. HSBC FAMILY OF FUNDS       49

HSBC TOTAL RETURN FUND

FinancialHighlights

Selected data for a share outstandingthroughout the periodsindicated.

				InvestmentActivities							Dividends													Ratios/Supplementary Data
	Net Asset Value, Beginning of Period			Net Investment Income (Loss)(a)	Net Realized and Unrealized Gains (Losses) from Investment			Total from Investment Activities			Net Investment Income	Net Realized Gains from Investment Transactions			Total Dividends			Net Asset Value, End of Period			Total Return(b)			Net Assets at End of Period (000’s)		Ratio of Net Expenses to Average Net Assets(c)	Ratio of Net Investment Income (Loss) to Average Net Assets(c)	Ratios of Expenses to Average Net Assets (Excluding Fee Reductions)(c)	Portfolio Turnover (b)(d)
CLASS A SHARES
Period Ended October 31, 2012(e)		$	10.00	0.03		0.33			0.36		(0.04)		—			(0.04	)		$	10.32		3.62	%		$256	1.60%	0.56%	1.61%	83%
Year Ended October 31, 2013		$	10.32	0.10		(0.21	)		(0.11	)	(0.05)		(0.03	)		(0.08	)		$	10.13		(1.06	)%		$268	1.47%	0.94%	1.47%	64%
CLASS I SHARES
Period Ended October 31, 2012(e)		$	10.00	0.07		0.31			0.38		(0.05)		—			(0.05	)		$	10.33		3.82	%		$348,443	1.18%	1.08%	1.18%	83%
Year Ended October 31, 2013		$	10.33	0.13		(0.20	)		(0.07	)	(0.08)		(0.03	)		(0.11	)		$	10.15		(0.66	)%		$642,545	1.18%	1.33%	1.18%	64%
CLASS S SHARES
Period Ended October 31, 2012(e)		$	10.00	0.05		0.34			0.39		(0.06)		—			(0.06	)		$	10.33		3.87	%		$104	1.15%	0.91%	1.48%	83%
Year Ended October 31, 2013		$	10.33	0.18		(0.24	)		(0.06	)	(0.09)		(0.03	)		(0.12	)		$	10.15		(0.57	)%		$24,758	1.12%	1.80%	1.12%	64%

(a)	Calculated using average share method.
(b)	Not annualized for periods less than one year. Total return calculations do not include any sales or redemption charges.
(c)	Annualized for periods less than one year.
(d)	Portfolio turnover rate is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.
(e)	Commenced operations on March 30, 2012.

50       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC RMB FIXED INCOME FUND

FinancialHighlights

Selected data for a share outstandingthroughout the periodsindicated.

				InvestmentActivities					Dividends									Ratios/Supplementary Data
	Net Asset Value, Beginning of Period			Net Investment Income (Loss)			Net Realized and Unrealized Gains (Losses) from Investments	Total from Investment Activities	Net Investment Income	Net Realized Gains from Investment Transactions			Total Dividends	Net Asset Value, End of Period			Total Return(a)	Net Assets at End of Period (000’s)		Ratio of Net Expenses to Average Net Assets(b)	Ratio of Net Investment Income (Loss) to Average Net Assets(b)	Ratios of Expenses to Average Net Assets (Excluding Fee Reductions)(b)	Portfolio Turnover (a)(c)
CLASS A SHARES
Period Ended October 31, 2012(d)		$	10.00		0.10	(e)	0.22	0.32	(0.08)		—		(0.08)		$	10.24	3.24%		$1,530	1.45%	2.54%	3.26%	—%
Year Ended October 31, 2013		$	10.24		0.31		0.29	0.60	(0.32)		—	(f)	(0.32)		$	10.52	5.96%		$2,959	1.45%	2.97%	2.50%	—%
CLASS I SHARES
Period Ended October 31, 2012(d)		$	10.00		0.10	(e)	0.24	0.34	(0.09)		—		(0.09)		$	10.25	3.40%		$10,134	1.10%	2.43%	2.26%	—%
Year Ended October 31, 2013		$	10.25		0.34		0.30	0.64	(0.36)		—	(f)	(0.36)		$	10.53	6.31%		$10,856	1.10%	3.30%	2.09%	—%
CLASS S SHARES
Period Ended October 31, 2012(d)		$	10.00		0.10	(e)	0.24	0.34	(0.09)		—		(0.09)		$	10.25	3.44%		$103	1.00%	2.53%	2.16%	—%
Year Ended October 31, 2013		$	10.25		0.35		0.30	0.65	(0.37)		—	(f)	(0.37)		$	10.53	6.41%		$110	1.00%	3.40%	1.99%	—%

(a)	Not annualized for periods less than one year. Total return calculations do not include any sales or redemption charges.
(b)	Annualized for periods less than one year.
(c)	Portfolio turnover rate is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.
(d)	Commenced operations on June 8, 2012.
(e)	Calculated based on average shares outstanding.
(f)	Represents less than $0.005 or $(0.005).

See notes to financial statements. HSBC FAMILY OF FUNDS       51

HSBC FAMILY OF FUNDS

Notes to Financial Statements — as of October 31, 2013

1. Organization:

     The HSBC Funds (the “Trust’’), a Massachusetts business trust organized on April 22, 1987, is registered under the Investment Company Act of 1940, as amended (the “Act’’), as an open-end management investment company. As of October 31, 2013, the Trust is comprised of 15 separate operational funds, each a series of the HSBC Family of Funds, which also includes the HSBC Advisor Funds Trust and the HSBC Portfolios (the “Trusts’’). The accompanying financial statements are presented for the following 5 funds (individually a “Fund,’’ collectively the “Funds’’ or the “Emerging Markets Funds’’):

Fund	Short Name
HSBC Emerging Markets Debt Fund	Emerging Markets Debt Fund
HSBC Emerging Markets Local Debt Fund	Emerging Markets Local Debt Fund
HSBC Frontier Markets Fund	Frontier Markets Fund
HSBC Total Return Fund	Total Return Fund
HSBC RMB Fixed Income Fund	RMB Fixed Income Fund

     Each of the Funds is a non-diversified fund. Financial statements for all other funds of the Trusts are published separately.

     The Funds are authorized to issue an unlimited number of shares of beneficial interest with a par value of $ 0.001 per share. The Emerging Markets Debt Fund, the Emerging Markets Local Debt Fund, the Total Return Fund and the RMB Fixed Income Fund (“Debt Funds’’) are authorized to issue three classes of shares: Class A Shares, Class I Shares, and Class S Shares. Class A Shares of the Debt Funds have a maximum sales charge of 4.75% as a percentage of the original purchase price. The Frontier Markets Fund is authorized to issue two classes of shares: Class A Shares and Class I Shares. Class A Shares of the Frontier Markets Fund have a maximum sales charge of 5.00% as a percentage of the original purchase price. Each class of shares in each Fund has identical rights and privileges, except with respect to arrangements pertaining to shareholder servicing and/or distribution, class-related expenses, voting rights on matters affecting a single class of shares, and exchange privileges of each class of shares.

     Under the Trust’s organizational documents, the Funds’ officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Funds. In addition, in the normal course of business, the Trust enters into contracts with its service providers, which also provide for indemnifications by the Funds. The Funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Funds. However, based on experience, the Trust expects the risk of loss to be remote.

2. Significant Accounting Policies:

     The following is a summary of the significant accounting policies followed by the Funds in the preparation of their financial statements. The policies are in conformity with U.S. generally accepted accounting principles (“GAAP’’). The preparation of financial statements requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

Securities Valuation:

     The Funds record their investments at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The valuation techniques used to determine fair value are further described in Note 3 below.

52       HSBC FAMILY OF FUNDS

HSBC FAMILY OF FUNDS

Notes to Financial Statements — as of October 31, 2013 (continued)

Investment Transactions and Related Income:

     Investment transactions are accounted for no later than one business day after trade date. However, for financial reporting purposes, investment transactions are accounted for on trade date. Investment gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date except in the case of foreign securities, in which case dividends are recorded as soon as such information becomes available.

Foreign Currency Translation:

     The accounting records of the Funds are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. Purchases and sales of securities, and income and expenses are translated at the prevailing rate of exchange on the respective dates of such transactions. The Funds do not isolate the portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies.

     Income received by the Funds from sources within foreign countries may be subject to withholding and other income or similar taxes imposed by such countries. The Funds accrue such taxes, as applicable, based on their current interpretation of tax rules in the foreign markets in which they invest.

Restricted and Illiquid Securities:

     A restricted security is a security which has been purchased through a private offering and cannot be resold to the general public without prior registration under the Securities Act of 1933 (the “1933 Act’’) or pursuant to the resale limitations provided by Rule 144 under the 1933 Act, or another exemption from the registration requirements of the 1933 Act. Certain restricted securities may be resold in transactions exempt from registration, normally to qualified institutional buyers, and may be deemed liquid by the Investment Adviser (as defined in Note 4) based on procedures established by the Board of Trustees (the “Board’’). Therefore, not all restricted securities are considered illiquid. At October 31, 2013, all restricted securities held were deemed liquid (except as noted below). The restricted securities held as of October 31, 2013 are identified below:

					%
	Acquisition	Acquisition	Principal	Fair	of Net
	Date	Cost	Amount ($)	Value ($)	Assets
Emerging Markets Debt Fund
Banco Nacional de Desenvolvimento Economico e Social, 5.75%, 9/26/23	9/19/2013	199,774	200,000	207,500	0.5	%
Banco Santander SA, 4.13%, 11/9/22	11/6/2012	147,275	150,000	143,437	0.3	%
Caixa Economica Federal, 4.50%, 10/3/18	9/26/2013	149,000	150,000	150,750	0.4	%
CNOOC Curtis Funding No.1 Pty Ltd., 4.50%, 10/3/23	9/26/2013	200,000	200,000	203,166	0.5	%
Comision Federal de Electricidad, 4.88%, 1/15/24	10/17/2013	198,854	200,000	202,750	0.5	%
Development Bank of Kazakhstan, 4.13%, 12/10/22	11/26/2012	196,764	200,000	184,500	0.4	%
PT Pertamina (Persero) Tbk, 4.30%, 5/20/23	5/13/2013	200,000	200,000	182,500	0.4	%
Republic of Indonesia, 3.38%, 4/15/23	4/8/2013	346,336	350,000	315,000	0.7	%
Republic of Indonesia, 5.38%, 10/17/23	7/17/2013	515,000	500,000	526,250	1.2	%
Republic of Nigeria, 6.38%, 7/12/23	7/2/2013	196,386	200,000	211,500	0.5	%
Republic of Paraguay, 4.63%, 1/25/23 *	1/17/2013	200,000	200,000	189,000	0.4	%
Republic of Slovenia, 5.85%, 5/10/23	5/2/2013	197,768	200,000	195,000	0.5	%
Russia Foreign Bond, 4.88%, 9/16/23	9/9/2013	400,124	400,000	419,600	1.0	%
Sinopec Capital (2013) Ltd., 3.13%, 4/24/23	4/19/2013	197,880	200,000	183,441	0.4	%
Sinopec Group Overseas Development (2013) Ltd., 4.38%, 10/17/23	10/9/2013	499,464	500,000	501,661	1.2	%
Turkiye Is Bankasi AS, 3.88%, 11/7/17	11/1/2012	198,654	200,000	194,760	0.5	%
Turkiye Vakiflar Bankasi TAO, 5.00%, 10/31/18	10/24/2013	198,700	200,000	199,010	0.5	%

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					%
	Acquisition	Acquisition	Principal	Fair	of Net
	Date	Cost	Amount ($)	Value ($)	Assets
Frontier Markets Fund
KazMunaiGas Exploration Production GDR	9/6/2011	1,723,320	108,164	1,534,847	1.7	%
Total Return Fund
Banco del Estado de Chile, 2.00%, 11/9/17	5/7/2013	2,616,744	2,600,000	2,553,509	0.4	%
Banco Nacional de Desenvolvimento Economico e Social, 5.75%, 9/26/23	9/19/2013	2,197,514	2,200,000	2,282,500	0.3	%
Banco Santander SA, 4.13%, 11/9/22	11/6/2012	1,080,013	1,100,000	1,051,875	0.2	%
Caixa Economica Federal, 4.50%, 10/3/18	9/26/2013	2,185,326	2,200,000	2,211,000	0.3	%
CNOOC Curtis Funding No.1 Pty Ltd., 4.50%, 10/3/23	9/26/2013	1,425,000	1,425,000	1,447,558	0.2	%
CNPC General Capital Ltd., 1.45%, 4/16/16	4/9/2013	799,184	800,000	796,820	0.1	%
Comision Federal de Electricidad, 4.88%, 1/15/24	10/17/2013	1,590,832	1,600,000	1,622,000	0.2	%
Development Bank of Kazakhstan, 4.13%, 12/10/22	11/29/2012	1,743,000	1,750,000	1,614,375	0.2	%
Eskom Holdings SOC Ltd., 6.75%, 8/6/23	7/30/2013	2,428,122	2,450,000	2,529,625	0.4	%
Harvest Operations Corp., 2.13%, 5/14/18	5/7/2013	1,096,007	1,100,000	1,074,909	0.2	%
PT Pertamina (Persero) Tbk, 4.30%, 5/20/23	5/13/2013	1,300,000	1,300,000	1,186,250	0.2	%
Republic of Costa Rica, 4.25%, 1/26/23	11/16/2012	1,199,868	1,200,000	1,140,000	0.2	%
Republic of Indonesia, 3.38%, 4/15/23	4/8/2013	1,781,154	1,800,000	1,620,000	0.2	%
Republic of Peru, 8.38%, 5/3/16	5/21/2013	5,416,706	4,525,000	5,271,625	0.8	%
Republic of Slovenia, 5.85%, 5/10/23	5/2/2013	3,362,056	3,400,000	3,315,000	0.5	%
Russia Foreign Bond, 4.88%, 9/16/23	9/9/2013	2,355,888	2,400,000	2,517,600	0.4	%
Sibur Securities Ltd., 3.91%, 1/31/18	1/24/2013	3,100,000	3,100,000	3,030,250	0.5	%
Sinopec Capital (2013) Ltd., 1.25%, 4/24/16	4/18/2013	3,291,387	3,300,000	3,280,296	0.5	%
Sinopec Group Overseas Development (2013) Ltd., 4.38%, 10/17/23	10/9/2013	5,362,848	5,400,000	5,417,933	0.8	%
Turkiye Halk Bankasi AS, 3.88%, 2/5/20	1/29/2013	2,472,525	2,500,000	2,270,325	0.3	%
Turkiye Is Bankasi AS, 3.88%, 11/7/17	11/1/2012	993,270	1,000,000	973,800	0.1	%
Turkiye Is Bankasi AS, 5.50%, 4/21/19	10/10/2013	1,442,272	1,450,000	1,466,313	0.2	%
Turkiye Vakiflar Bankasi TAO, 5.00%, 10/31/18	10/24/2013	794,800	800,000	796,040	0.1	%
Turkiye Vakiflar Bankasi TAO, 6.00%, 11/1/22	12/3/2012	1,452,724	1,400,000	1,310,750	0.2	%

____________________

*       As of October 31, 2013 this restricted security was deemed illiquid by the Investment Adviser.

Participation Notes and Participatory Notes:

     The Frontier Markets Fund may invest in participation notes or participatory notes (“P-notes”). P-notes are participation interest notes that are issued by banks or broker-dealers and are designed to offer a return linked to a particular underlying equity, debt, currency or market. If the P-note was held to maturity, the issuer would pay to, or receive from, the purchaser the difference between the nominal value of the underlying instrument at the time of purchase and that instrument’s value at maturity. The holder of a P-note that is linked to a particular underlying security or instrument may be entitled to receive any dividends paid in connection with that underlying security or instrument, but typically does not receive voting rights as it would if it directly owned the underlying security or instrument. P-notes involve transaction costs. Investments in P-notes involve the same risks associated with a direct investment in the underlying securities, instruments or markets that they seek to replicate. In addition, there can be no assurance that there will be a trading market for a P-note or that the trading price of a P-note will equal the underlying value of the security, instrument or market that it seeks to replicate. Due to liquidity and transfer restrictions, the secondary markets on which a P-note is traded may be less liquid than the market for other securities, or may be completely illiquid, which may also affect the ability of the Fund to accurately value a P-note. P-notes typically constitute general unsecured contractual obligations of the banks or broker- dealers that issue them, which subjects the Fund that holds them to counterparty risk (and this risk may be amplified if the Fund purchases P-notes from only a small number of issuers).

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Notes to Financial Statements — as of October 31, 2013 (continued)

Derivative Instruments:

     All open derivative positions at year end are reflected on the Funds’ Schedule of Portfolio Investments. The following is a description of the derivative instruments utilized by the Funds, including the primary underlying risk exposure related to each instrument type.

Forward Foreign Currency Exchange Contracts:

     Each Fund may enter into forward foreign currency exchange contracts. The Funds may enter into forward foreign currency exchange contracts in connection with planned purchases or sales of securities, to hedge the U.S. dollar value of securities denominated in a particular currency or to enhance return. The forward foreign currency exchange contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date.

     The Funds could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar.

     The Funds remain subject to credit risk with respect to the amount they expect to receive from counterparties. However, the Funds have sought to mitigate these risks by generally requiring the posting of collateral to a Fund at prearranged exposure levels to cover a Fund’s exposure to the counterparty.

     During the year ended October 31, 2013, the Funds entered into forward foreign currency exchange contracts to gain exposure to certain markets and for hedging purposes. The notional amount of forward foreign currency exchange contracts outstanding as of October 31, 2013 and the monthly average notional amount for these contracts during the year ended October 31, 2013 were as follows:

	Outstanding		Monthly Average
	Notional Amount ($)		Notional Amount ($)
Forward Foreign Currency Exchange Contracts:
Emerging Markets Debt Fund		3,666,908		611,998
Emerging Markets Local Debt Fund		57,440,322		43,525,024
Frontier Markets Fund		—		109,700
Total Return Fund		974,398,634		372,870,846

Options Contracts:

     The Funds may purchase or write put and call options on securities, indices, foreign currencies and derivative instruments. When purchasing options, the Funds pay a premium which is recorded as the cost basis in the investment and which is subsequently marked to market to reflect the current value of the option. Premiums paid for purchasing options that expire are treated as realized losses. When an option is exercised or closed, premiums paid for purchasing options are offset against proceeds to determine the realized gain or loss on the transaction. When writing options, the Funds receive a premium which is recorded as a liability and which is subsequently marked to market to reflect the current value of the option written. Premiums received from writing options that expire are treated as realized gains. Premiums received from writing options that are either exercised or closed are offset against the proceeds received or the amount paid on the transaction to determine the realized gains or losses.

     The Funds may purchase or write put and call options on foreign currencies for the purpose of protecting against declines in the dollar value of foreign portfolio securities and against increases in the U.S. dollar cost of foreign securities to be acquired. The Funds could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar.

     The Funds may enter into interest rate swaption agreements for hedging purposes. A swaption is an option to enter into a pre-defined swap agreement by some specified date in the future. The writer of the swaption becomes the counterparty to the swap if the buyer exercises their option. The interest rate swaption

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Notes to Financial Statements — as of October 31, 2013 (continued)

agreement will specify whether the buyer of the swaption will be a fixed rate receiver or a fixed rate buyer. The Funds could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in interest rates.

     The Funds remain subject to credit risk with respect to the amount they expect to receive from counterparties. However, the Funds have sought to mitigate these risks by generally requiring the posting of collateral to an Emerging Markets Fund at prearranged exposure levels to cover an Emerging Markets Fund’s exposure to the counterparty.

     During the year ended October 31, 2013, the Emerging Markets Local Debt Fund and the Total Return Fund invested in options on foreign currencies for the purpose of protecting against declines in the U.S. dollar value of foreign portfolio securities and against increases in the U.S. dollar cost of foreign securities to be acquired. The Emerging Markets Local Debt Fund also entered into interest rate swaption agreements for hedging purposes.

     The Emerging Markets Local Debt Fund and the Total Return Fund had the following transactions in purchased call and put options during the year ended October 31, 2013:

	Number of
Emerging Markets Local Debt Fund	Contracts			Cost
Options outstanding at October 31, 2012		3,270,000			$	35,411
Options expired		(3,270,000	)			(35,411	)
Options outstanding at October 31, 2013		—			$	—
	Number of
Total Return Fund	Contracts			Cost
Options outstanding at October 31, 2012		500,000			$	12,985
Options expired		(500,000	)			(12,985	)
Options outstanding at October 31, 2013		—			$	—
The Emerging Markets Local Debt Fund had the following transactions in written call and put options during the period ended October 31, 2013:
	Number of			Premiums
Emerging Markets Local Debt Fund	Contracts			Received
Options outstanding at October 31, 2012		—			$	—
Options written		(3,000,000	)			(14,160	)
Options expired		3,000,000				14,160
Options outstanding at October 31, 2013		—			$	—
Futures Contracts:

     The Funds may invest in futures contracts for the purpose of hedging existing portfolio securities or securities they intend to purchase against fluctuations in fair value caused by changes in prevailing market interest conditions. Upon entering into futures contracts, the Funds are required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin”, are made or received each day, depending on the daily fluctuations in the fair value of the underlying security. The Funds recognize an unrealized gain or loss equal to the daily variation margin. Should market conditions move unexpectedly, the Funds may not achieve the anticipated benefits of the futures contracts and may realize a loss. Futures contracts involve, to varying degrees, elements of market risk (generally equity price risk related to stock futures, interest rate risk related to bond futures, and foreign currency risk related to currency futures) and exposure to loss in excess of the variation margin. The primary risks associated with the use of futures contracts are the imperfect correlation between the change in market value of the securities held by the Funds and the prices of futures contracts,

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Notes to Financial Statements — as of October 31, 2013 (continued)

the possibility of an illiquid market, and the inability of the counterparty to meet the terms of the contract. During the year ended October 31, 2013, the Emerging Markets Debt Fund and the Total Return Fund invested in futures contracts to gain exposure to certain markets and for hedging purposes. The gross notional amount of futures contracts outstanding as of October 31, 2013 and the monthly average notional amount for these contracts for the year ended October 31, 2013 were as follows:

	Outstanding		Monthly Average
Futures Contacts:	Notional Amount ($)		Notional Amount ($)
Emerging Markets Debt Fund		2,674,547		673,859
Total Return Fund		45,339,938		35,484,767

Swap Agreements:

     The Funds may enter into swap contracts and other similar instruments in accordance with their investment objectives and policies. A swap is an agreement to exchange the return generated by one instrument for the return generated by another instrument. The payment streams are calculated by reference to a specified index and agreed upon notional amount. The term specified index includes currencies, fixed interest rates, prices and total return on interest rate indices, fixed income indices, stock indices and commodity indices.

     The Funds will usually enter into swaps on a net basis, which means that the two return streams are netted out in a cash settlement on the payment date or dates specified in the instrument, with a Fund receiving or paying only the net amount of the two returns. Upfront receipts and payments are recorded as deferred income (liability) or deferred expense (asset), as the case may be. These upfront receipts and payments are amortized to income or expense over the life of the swap agreement. Until a swap agreement is settled in cash, the gain or loss on the notional amount plus income on the instruments, less the interest paid by the Fund on the notional amount, is recorded as “unrealized appreciation or depreciation on swap agreements” and, when cash is exchanged, the gain or loss realized is recorded as “realized gains or losses on swap agreements”. A Fund’s obligations under a swap agreement will be accrued daily (offset against any amounts owing to the Fund) and any accrued but unpaid net amounts owed to a swap counterparty will be covered by the maintenance of a segregated account consisting of cash, U.S. government securities, or other liquid securities or by pledging such securities as collateral.

     Interest rate swaps involve the exchange of commitments to pay and receive interest based on a notional amount and are subject to interest rate risk exposure. Interest rate swaps do not involve the delivery of securities, other underlying assets or principal. Accordingly, the risk of loss with respect to interest rate swaps is limited to the net amount of interest payments that a Fund is contractually obligated to make. If the other party to an interest rate swap defaults, a Fund’s risk of loss consists of the net amount of interest payments that the Fund is contractually entitled to receive.

     Credit default swap agreements involve one party making a stream of payments (referred to as the buyer of protection) to another party (the seller of protection) in exchange for the right to receive a specified return in the event of a default or other credit event for the referenced entity, obligation or index and are subject to credit risk exposure. The maximum potential amount of future payments that a Fund as a seller of protection could be required to make under a credit default swap agreement would be an amount equal to the notional amount of the agreement. Notional amounts of each individual credit default swap agreement outstanding as of October 31, 2013 for which a Fund is the seller of protection are disclosed in the Schedules of Portfolio Investments. These potential amounts would be partially offset by any recovery values of the respective referenced obligations, upfront payments received upon entering into the agreement, or net amounts received from the settlement of buy protection credit default swap agreements entered into by a Fund for the same referenced entity or entities.

     The Funds remain subject to credit risk with respect to the amount they expect to receive from counterparties. However, the Funds have sought to mitigate these risks by generally requiring the posting of collateral to a Fund at pre-arranged exposure levels to cover a Fund’s exposure to the counterparty.

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Notes to Financial Statements — as of October 31, 2013 (continued)

     The use of swaps is a highly specialized activity that involves investment techniques and risks different from those associated with ordinary portfolio securities transactions. If the Investment Adviser is incorrect in its forecasts of market values, interest rates and currency exchange rates, the investment performance of a Fund would be less favorable than it would have been if this investment technique were not used.

     During the year ended October 31, 2013, the Emerging Markets Local Debt Fund and the Total Return Fund entered into interest rate swap agreements to manage their exposure to interest rates and as a substitute for investing directly in securities. The Emerging Markets Debt Fund and Total Return Fund also entered into credit default swap agreements primarily to manage and/or gain exposure to credit risk. The notional amount of swap agreements outstanding as of October 31, 2013 and the monthly average notional amount for these agreements during the year ended October 31, 2013 were as follows:

	Outstanding		Monthly Average
	Notional Amount ($)		Notional Amount ($)
Interest Rate Swap Agreements:
Emerging Markets Local Debt Fund		18,948,522		11,844,553
Total Return Fund		253,276,193		74,711,419
Credit Default Swap Agreements:
Emerging Markets Debt Fund		2,350,000		1,947,917
Total Return Fund		199,250,000		85,866,667
Summary of Derivative Instruments:
Fair Values of Derivative Instruments on the Statements of Assets and Liabilities as of October 31, 2013:

	Assets						Liabilities
	Unrealized						Unrealized
	Appreciation		Variation				Depreciation		Variation
	on Forward		Margin on		Unrealized		on Forward		Margin		Unrealized
	Foreign Currency		Futures		Appreciation		Foreign Currency		on Futures		Depreciation
	Exchange		Contracts^		on Swap		Exchange		Contracts^		on Swap
Fund	Contracts ($)		($)		Agreements ($)		Contracts ($)		($)		Agreements ($)
Foreign Exchange Rate Risk Exposure:
Emerging Markets Debt Fund		23,061		—		—		9,034		—		—
Emerging Market Local Debt Fund		650,894		—		—		314,430		—		—
Total Return Fund		11,394,144		—		—		5,284,991		—		—
Credit Contracts Risk Exposure:
Emerging Markets Debt Fund		—		—		36,270		—		—		3,254
Total Return Fund		—		—		486,877		—		—		1,899,917
Interest Rate Risk Exposure:
Emerging Markets Debt Fund		—		91,503		—		—		—		—
Emerging Market Local Debt Fund		—		—		61,749		—		—		213,103
Total Return Fund		—		—		745,046		—		1,499,848		1,463,880

____________________

^        Includes cumulative appreciation/depreciation on futures contracts as reported in the Schedule of Portfolio Investments. Only current day’s variation margin is reported on the Statement of Assets and Liabilities.

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Notes to Financial Statements — as of October 31, 2013 (continued)

The Effect of Derivative Instruments on the Statements of Operations for the year ended October 31, 2013:

	Realized Gain (Loss) on Derivatives Recognized as a Result from Operations												Net Change in Unrealized Appreciation/Depreciation on Derivatives Recognized as a Result from Operations
Fund	Net Realized Gains (Losses) from Forward Foreign Currency Exchange Contracts ($)			Net Realized Gains (Losses) from Futures Transactions ($)			Net Realized Gains (Losses) from Swap Agreements ($)			Net Realized Gains (Losses) from Options Transactions ($)			Change in Unrealized Appreciation/Depreciation on Investments ($)
Foreign Exchange Rate Risk Exposure:
Emerging Markets Debt Fund		39,161			—			—			—			14,181
Emerging Markets Local Debt Fund		(67,998	)		—			—			(21,251	)		129,468
Frontier Markets Fund		(37,785	)		—			—			—			—
Total Return Fund		(3,376,735	)		—			—			(12,985	)		6,174,638
RMB Fixed Income Fund		863			—			—			—			—
Credit Contracts Risk Exposure:
Emerging Markets Debt Fund		—			—			38,683			—			(36,570	)
Total Return Fund		—						532,955			—			(1,437,928	)
Interest Rate Risk Exposure:
Emerging Markets Debt Fund		—			(52,363	)		—			—			91,503
Emerging Markets Local Debt Fund		—			—			(70,319	)		—			(280,760	)
Total Return Fund		—			2,792,335			1,462,344			—			(2,053,263	)

Allocations:

     Expenses directly attributable to a Fund are charged to that Fund. Expenses not directly attributable to a Fund are allocated proportionately among the applicable series within the Trusts in relation to the net assets of each fund or on another reasonable basis. Class specific expenses are charged directly to the class incurring the expense. In addition, income, expenses (other than class specific expenses), and unrealized and realized gains and losses are allocated to each class based on relative net assets on a daily basis.

Dividends to Shareholders:

     Dividends to shareholders from net investment income, if any, are declared and distributed monthly in the case of the Funds, and annually in the case of the Frontier Markets Fund. Dividends from net realized gains, if any, are declared and paid at least annually by the Funds. Additional distributions are also made to the Funds’ shareholders to the extent necessary to avoid the federal excise tax on certain undistributed income and net realized gains of regulated investment companies.

     The amount and character of net investment income and net realized gains distributions are determined in accordance with federal income tax regulations which may differ from GAAP. These “book/tax’’ differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature (e.g., certain gain/loss, differing treatment on certain swap agreements, and certain distributions), such amounts are reclassified within the composition of net assets; temporary differences (e.g., wash losses and the realization for tax purposes of unrealized gains/losses on investments in passive foreign investment companies) do not require reclassification. The Funds may utilize equalization accounting for tax purposes and designate earnings and profits, including net realized gains distributed to shareholders on redemption of shares, as a part of the dividends paid deduction for income tax purposes. To the extent distributions to shareholders from net investment income and net realized gains exceed net investment income and net realized gains for tax purposes, they are reported as distributions of capital.

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Notes to Financial Statements — as of October 31, 2013 (continued)

Federal Income Taxes:

     Each Fund is a separate taxable entity for federal income tax purposes. Each Fund has qualified and intends to continue to qualify each year as a “regulated investment company’’ under Subchapter M of the Internal Revenue Code, as amended, and to distribute substantially all of its taxable net investment income and net realized gains, if any, to its shareholders. Accordingly, no provision for federal income or excise tax is required.

     Management of the Funds has reviewed tax positions taken in tax years that remain subject to examination by all major tax jurisdictions, including federal (i.e., the last four tax year ends and the interim tax period since then, as applicable). Management believes that there is no tax liability resulting from unrecognized tax benefits related to uncertain tax positions taken.

New Accounting Pronouncements:

     In January 2013, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2013-01 “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities” (“ASU 2013-01”), which amended Accounting Standards Codification Subtopic 210-20, Balance Sheet Offsetting. ASU 2013-01 clarified the scope of ASU No. 2011-11 “Disclosures about Offsetting Assets and Liabilities” (“ASU 2011-11”). ASU 2011-11 requires an entity to disclose information about offsetting and related arrangements to enable users of the financial statements to understand the effect of those arrangements on the entity’s financial position. ASU 2013-01 clarifies the scope of ASU 2011-11 as applying to derivatives accounted for in accordance with Topic 815, Derivatives and Hedging, including bifurcated embedded derivatives, repurchase agreements and reverse repurchase agreements, and securities borrowing and securities lending transactions that are offset either in accordance with other requirements of GAAP or subject to an enforceable master netting arrangement or similar agreement. The guidance in ASU 2013-01 and ASU 2011-11 is effective for interim and annual periods beginning on or after January 1, 2013. Management is evaluating any impact ASU 2013-01 and ASU 2011-11 may have on the Funds’ financial statements.

3. Investment Valuation Summary:

     The valuation techniques employed by the Funds, as described below, maximize the use of observable inputs and minimize the use of unobservable inputs in determining fair value. The inputs used for valuing the Funds’ investments are summarized in the three broad levels listed below:

• Level 1: quoted prices in active markets for identical assets

• Level 2: other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.)

• Level 3: significant unobservable inputs (including a Fund’s own assumptions in determining the fair value of investments)

     Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The Funds determine transfers between fair value hierarchy levels at the reporting period end. The inputs or methodology used for valuing investments are not necessarily an indication of the risk associated with investing in those investments.

     Bonds and other fixed income securities (other than short-term obligations but including listed issues) are valued at the bid price as of the time net asset value is determined on the basis of valuations furnished by a pricing service, the use of which has been approved by the Funds’ Board. In making such valuations, the pricing service utilizes both dealer-supplied valuations and matrix techniques which take into account appropriate factors such as the institutional-size trading in similar groups of securities, yield, quality, coupon rate, maturity, type of issue, trading characteristics other than market data and without exclusive reliance upon quoted prices or exchanges or over-the-counter prices, since such valuations are believed to reflect more accurately the fair value of such securities and are typically categorized as Level 2 in the fair value hierarchy.

     Exchange traded, domestic equity securities are valued at the last sale price on a national securities exchange, or in the absence of recorded sales, at the readily available closing bid price on such exchanges, or at the quoted bid price in the over-the-counter market and are typically categorized as Level 1 in the fair value hierarchy.

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     Exchange traded, foreign equity securities are valued in the appropriate currency on the last quoted sale price and are typically categorized as Level 1 in the fair value hierarchy. Foreign equity securities that are not exchange traded are valued in the appropriate currency at the average of the quoted bid and asked prices in the over-the-counter market and are typically categorized as Level 2 in the fair value hierarchy.

Mutual funds are valued at their net asset values, as reported by such companies and are typically categorized as Level 1 in the fair value hierarchy.

Exchange traded futures contracts are valued at their settlement price on the exchange on which they are traded and are typically categorized as Level 1 in the fair value hierarchy.

Forward foreign currency exchange contracts are valued at the current day’s interpolated foreign exchange rate, as calculated using the current day’s spot rate, and the 30 to 720 day forward rates and converted to U.S. dollars at the exchange rate of such currencies against the U.S. dollar, as of the close of regular trading on the New York Stock Exchange, as provided by an approved pricing service, and are typically categorized as Level 2 in the fair value hierarchy. Non-exchange traded derivatives, such as swaps and options, are generally valued by using a valuation provided by an approved independent pricing service and are typically categorized as Level 2 in the fair value hierarchy.

Securities or other assets for which market quotations are not readily available, or are deemed unreliable due to a significant event or otherwise, are valued pursuant to procedures adopted by the Trusts’ Board (“Procedures”). Depending on the source and relative significance of valuation inputs, these instruments may be classified as Level 2 or Level 3 in the fair value hierarchy. Examples of potentially significant events that could affect the value of an individual security and thus require pricing under the Procedures include corporate actions by the issuer, announcements by the issuer relating to its earnings or products, regulatory news, natural disasters, and litigation. Examples of potentially significant events that could affect multiple securities held by a Fund include governmental actions, natural disasters, and armed conflicts. Fair value pricing may require subjective determinations about the value of a security. While the Trust’s policy is intended to result in a calculation of a Fund’s net asset value (“NAV”) that fairly reflects security values as of the time of pricing, the Trust cannot ensure that fair values determined would accurately reflect the price that a Fund could obtain for a security if it were to dispose of that security as of the time of pricing. The prices used by a Fund may differ from the value that would be realized if the securities were sold and the differences could be material to the financial statements.

In addition, if events materially affecting the value of foreign securities occur between the time when the exchange on which they are traded closes and the time when the Funds’ NAV are calculated, such securities may be valued using fair value pricing in accordance with procedures adopted by the Board. Management identifies possible fluctuations in foreign securities by monitoring the rise or fall in the value of a designated benchmark index. In the event of a rise or fall greater than predetermined levels, the Funds may use a systematic valuation model provided by an independent third party to value its foreign securities, rather than local market closing prices. When a Fund uses such a valuation model, the value assigned to the Fund’s foreign securities may not be the quoted or published prices of the investments on their primary markets or exchanges and are typically categorized as Level 2 in the fair value hierarchy. The valuation of these securities may represent a transfer between Levels 1 and 2. The number of days on which fair value prices will be used will depend on market activity and it is possible that fair value prices will be used by the Funds to a significant extent.

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Notes to Financial Statements — as of October 31, 2012 (continued)

     The following is a summary of the valuation inputs used as of October 31, 2013 in valuing the Funds’ investments based upon the three levels defined above. The breakdown of country descriptions is disclosed in the Schedule of Portfolio Investments for each Fund:

	LEVEL 1 ($)	LEVEL 2 ($)		LEVEL 3 ($)		Total ($)
Emerging Markets Debt Fund
Investment Securities:
Corporate Obligation	—	10,850		—		10,850
Yankee Dollars	—	39,954,995		—		39,954,995
U.S. Treasury Obligation	—	224,156		—		224,156
Investment Companies	2,310,542	—		—		2,310,542
Total Investment Securities	2,310,542	40,190,001		—		42,500,543
Other Financial Instruments:(a)
Credit Default Swap Agreements	—	33,016		—		33,016
Forward Foreign Currency Contracts	—	14,027		—		14,027
Futures Contracts	91,503	—		—		91,503
Total Investments	91,503	47,043		—		138,546
Emerging Markets Local Debt
Investment Securities:
Foreign Bonds	—	21,028,499		—		21,028,499
Yankee Dollars	—	1,880,299		—		1,880,299
U.S. Treasury Obligations	—	1,003,217		—		1,003,217
Investment Companies	6,091,520	—		—		6,091,520
Total Investment Securities	6,091,520	23,912,015		—		30,003,535
Other Financial Instruments:(a)
Interest Rate Swap Agreements	—	(151,354	)	—		(151,354	)
Forward Foreign Currency Contracts	—	336,464		—		336,464
Total Investments	—	185,110		—		185,110
Frontier Markets Fund
Investment Securities:
Common Stocks
Metals & Mining	599,080	18,615		—		617,695
Other Common Stocks	72,905,070	—		—		72,905,070
Convertible Corporate Bonds	—	51,257		—		51,257
Participatory Notes	—	10,662,612		—		10,662,612
Investment Companies	2,324,522	—		—		2,324,522
Preferred Stock	474,623	—		—		474,623
Warrants	—	16,041		—	(b)	16,041
Total Investment Securities	76,303,295	10,748,525		—		87,051,820

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Notes to Financial Statements — as of October 31, 2013 (continued)

	LEVEL 1 ($)		LEVEL 2 ($)		LEVEL 3 ($)	Total ($)
Total Return Fund
Investment Securities:
Foreign Bonds	—		52,582,889		—	52,582,889
Yankee Dollars	—		428,460,425		—	428,460,425
U.S. Treasury Obligations	—		93,231,030		—	93,231,030
Investment Companies	69,101,935		—		—	69,101,935
Total Investment Securities	69,101,935		574,274,344		—	643,376,279
Other Financial Instruments:(a)
Interest Rate Swap Agreements	—		(718,834	)	—	(718,834	)
Credit Default Swap Agreements	—		(1,413,040	)	—	(1,413,040	)
Forward Foreign Currency Contracts	—		6,109,153		—	6,109,153
Futures Contracts	(1,499,848	)	—		—	(1,499,848	)
Total Investments	(1,499,848	)	3,977,279		—	2,477,431
RMB Fixed Income Fund
Investment Securities:
Foreign Bonds	—		12,044,381		—	12,044,381
Certificates of Deposit	—		1,472,539		—	1,472,539
Investment Companies	168,744		—		—	168,744
Total Investment Securities	168,744		13,516,920		—	13,685,664

____________________
 

(a)	Other financial instruments would include any derivative instruments, such as forward foreign currency contracts, futures contracts and swap agreements. These investments are generally recorded in the financial statements at the unrealized gain or loss on the investment.
(b)	Security was received as part of a private placement offering. The underlying stock price is trading significantly below the strike price of the warrants and the warrants are non-transferable. Security valued at $0 in good faith pursuant to procedures approved by the Board of Trustees as of October 31, 2013.

4. Related Party Transactions and Other Agreements and Plans:

Investment Management:

     HSBC Global Asset Management (USA) Inc. (“HSBC’’ or the “Investment Adviser’’), a wholly owned subsidiary of HSBC Bank USA, N.A., a national bank organized under the laws of the United States, acts as Investment Adviser to the Funds. As Investment Adviser, HSBC manages the investments of the Funds and continuously reviews, supervises and administers the Funds’ investments pursuant to an Investment Advisory Contract. For its services in this capacity, HSBC receives a fee from each Fund, accrued daily and paid monthly, based on the average daily net assets of Class A Shares, Class I Shares and Class S Shares of each respective Fund, at annual rate of:

Fund	Fee Rate(%)
Emerging Markets Debt Fund	0.50
Emerging Markets Local Debt Fund	0.50
Frontier Markets Fund	1.25
Total Return Fund	0.85
RMB Fixed Income Fund	0.55

HSBC Global Asset Management (UK) Limited (“AMEU”) acts as sub-adviser to the Frontier Markets Fund. AMEU receives a fee, accrued daily and paid monthly, based on average daily net assets of the Fund at an annual rate of 0.70% from the fees paid to the Investment Adviser.

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Notes to Financial Statements — as of October 31, 2013 (continued)

     HSBC Global Asset Management (Hong Kong) Limited (“AMHK”) acts as sub-adviser to the RMB Fixed Income Fund. AMHK receives a fee, accrued daily and paid monthly, based on average daily net assets of the Fund at an annual rate of 0.275% from the fees paid to the Investment Adviser.

HSBC also provides support services to the Funds pursuant to a Support Services Agreement. For its services in this capacity, HSBC receives a fee, accrued daily and paid monthly, based on the average daily net assets of Class A Shares and Class I Shares, at an annual rate of 0.20% and 0.10%, respectively.

Administration:

HSBC serves the Funds as Administrator. Under the terms of the Administration Agreement, HSBC receives from the Funds (as well as other funds in the Trusts combined) a fee, accrued daily and paid monthly, at an annual rate of:

Based on Combined Average Daily Net Assets of	Fee Rate(%)
Up to $10 billion	0.0550
In excess of $10 billion but not exceeding $20 billion	0.0350
In excess of $20 billion but not exceeding $ 50 billion	0.0275
In excess of $50 billion	0.0250

The fee rates and breakpoints are determined on the basis of the aggregate average daily net assets of the Trusts. The total administration fee paid to HSBC is allocated to each series based upon its proportionate share of the aggregate net assets of the Trusts, subject to certain allocations in cases where one fund invests some or all of its assets in another fund. An amount equal to 50% of the administration fee is deemed to be class specific.

Pursuant to a Sub-Administration Agreement with HSBC, Citi Fund Services Ohio, Inc. (“Citi’’), a wholly-owned subsidiary of Citigroup, Inc., serves as the Trusts’ Sub-Administrator, subject to the general supervision by the Trusts’ Board and HSBC. For these services, Citi is entitled to a fee, payable by HSBC, at an annual rate equivalent to the fee rates set forth above subject to certain reductions associated with services provided to new funds, minus 0.02%, which is retained by HSBC.

Under a Compliance Services Agreement between the Trusts and Citi (the “CCO Agreement’’), Citi makes an employee available to serve as the Trusts’ Chief Compliance Officer (the “CCO’’). Under the CCO Agreement, Citi also provides infrastructure and support in implementing the written policies and procedures comprising the Trusts’ compliance program, including support services to the CCO. For the services provided under the CCO Agreement, the Trusts paid Citi $287,560 for the year ended October 31, 2013, plus reimbursement of certain out of pocket expenses. Expenses incurred by each Fund are reflected on the Statements of Operations as “Compliance Services.’’ Citi pays the salary and other compensation earned by individuals performing these services, as employees of Citi.

Distribution Arrangements:

Foreside Distribution Services, L.P. (“Foreside”), a wholly-owned subsidiary of Foreside Financial Group LLC, serves the Trust as Distributor (the “Distributor’’). The Trust has adopted a non-compensatory Distribution Plan and Agreement (the “Distribution Plan’’) pursuant to Rule 12b-1 of the Act. The Distribution Plan provides for reimbursement of expenses incurred by the Distributor related to distribution and marketing, at a rate not to exceed 0.25% of the average daily net assets of Class A Shares (currently not being charged). For the year ended October 31, 2013, Foreside, as Distributor, also received $ 213,520 in commissions from sales of the Trusts for Class A Shares, of which $584 were reallocated to HSBC-affiliated brokers and dealers for Class A Shares.

Shareholder Servicing:

The Trust has adopted a Shareholder Services Plan, which provides for payments to shareholder servicing agents (which primarily consist of HSBC and its affiliates) for providing various shareholder services. For performing these services, the shareholder servicing agents receive a fee that is computed daily and paid monthly up to

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Notes to Financial Statements — as of October 31, 2013 (continued)

0.25% of the average daily net assets of Class A Shares. The aggregate fees paid to the Distributor pursuant to the Distribution Plan and to shareholder servicing agents pursuant to the Shareholder Services Plan may not exceed, in the aggregate, 0.50% annually of each Fund’s average daily net assets of Class A Shares.

Fund Accounting and Transfer Agency:

     Citi provides fund accounting and transfer agency services for each Fund. As transfer agent, Citi receives a fee based on the number of funds and shareholder accounts, subject to certain minimums, reductions associated with services provided to new funds and reimbursement of certain expenses. As fund accountant, Citi receives an annual fee per Fund and share class, subject to minimums, reductions associated with services provided to new funds and reimbursement of certain expenses. Citi receives additional fees paid by the Trust for blue sky exemption services.

Independent Trustees:

The Trusts pay each Independent Trustee an annual retainer of $100,000. The Trusts pay a fee of $10,000 for each regular meeting of the Board attended and a fee of $ 3,000 for each special meeting attended. The Trusts pay each Committee Chair an annual retainer of $ 3,000, with the exception of the Chair of the Audit Committee, who receives a retainer of $ 6,000. The Trusts also pay the Chairman of the Board, an additional annual retainer of $24,000. In addition, for time expended on Board duties outside normal meetings, which is authorized by the Board, a Trustee is compensated at the rate of $ 500 per hour, up to a maximum of $ 3,000 per day.

Fee Reductions:

The Investment Adviser has agreed to contractually limit, through March 1, 2014, the total annual expenses, exclusive of interest, taxes, brokerage commissions, extraordinary expenses, and indirect expenses attributable to the Fund’s investments in investment companies, of the Funds. Each Fund Class has its own expense limitations based on the average daily net assets for any full fiscal year as follows:

		Current
		Contractual
Fund	Class	Expense Limitation(%)
Emerging Markets Debt Fund	A	1.20
Emerging Markets Debt Fund	I	0.85
Emerging Markets Debt Fund	S	0.75
Emerging Markets Local Debt Fund	A	1.20
Emerging Markets Local Debt Fund	I	0.85
Emerging Markets Local Debt Fund	S	0.75
Frontier Markets Fund	A	2.20
Frontier Markets Fund	I	1.85
Total Return Fund	A	1.60
Total Return Fund	I	1.25
Total Return Fund	S	1.15
RMB Fixed Income Fund	A	1.45
RMB Fixed Income Fund	I	1.10
RMB Fixed Income Fund	S	1.00

Any amounts contractually waived or reimbursed by the Investment Adviser will be subject to repayment by the respective Fund to the Investment Adviser within three years to the extent that the repayment will not cause the Fund’s operating expenses to exceed the contractual expense limit that was in effect at the time

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Notes to Financial Statements — as of October 31, 2013 (continued)

of such waiver or reimbursement. During the year ended October 31, 2013, the Investment Adviser did not recapture any of its prior contractual waivers or reimbursements. As of October 31, 2013, the repayments that may potentially be made by the Funds are as follows:

	2016($)	2015($)	2014($)	Total ($)
Emerging Markets Debt Fund	112,179	159,226	31,279	302,684
Emerging Markets Local Debt Fund	159,629	218,089	41,089	418,807
Frontier Markets Fund	201,653	145,285	5,922	352,860
Total Return Fund	—	207	N/A	207
RMB Fixed Income Fund	130,790	51,659	N/A	182,449

     The Administrator and Citi may voluntarily waive/reimburse fees to help support the expense limits of the Funds. In addition, HSBC, in its role as Investment Adviser and Administrator, may waive/reimburse additional fees at its discretion. Any voluntary fee waivers/reimbursements are not subject to recoupment in subsequent fiscal periods. Voluntary waivers/reimbursements may be stopped at any time. Amounts waived/reimbursed by the Investment Adviser, Administrator, and Citi are reported separately on the Statements of Operations, as applicable.

5. Investment Transactions:

Cost of purchases and proceeds from sales of securities (excluding securities maturing less than one year from acquisition) for the year ended October 31, 2013 were as follows:

	Purchases($)	Sales($)
Emerging Markets Debt Fund	19,652,112	13,496,789
Emerging Markets Local Debt Fund	25,944,392	18,421,435
Frontier Markets Fund	78,727,023	16,625,243
Total Return Fund	503,641,700	178,664,318
RMB Fixed Income Fund	4,040,286	—

For the period ended October 31, 2013, purchases and sales on long-term U.S. government securities were as follows:

	Purchases($)	Sales($)
Emerging Markets Debt Fund	4,614,547	6,993,807
Emerging Markets Local Debt Fund	1,722,047	1,433,697
Total Return Fund	112,849,675	23,109,929

6. Investment Risks:

Foreign Securities Risk: Investments in foreign securities are generally considered riskier than investments in U.S. securities. Foreign securities, including those of emerging and frontier market issuers, are subject to additional risks, including international trade, political and regulatory risks.

Emerging Markets Risk: The prices of securities in emerging markets can fluctuate more significantly than the prices of companies in more developed countries. Securities of emerging market issuers generally have more risk than securities issued by issuers in more developed markets. The less developed the country, the greater affect the risks may have in an investment, and as a result, an investment may exhibit a higher degree of volatility than either the general domestic securities market or the securities markets of more developed foreign countries.

Frontier Market Countries Risk: Frontier market countries generally have smaller economies and even less developed capital markets or legal and political systems than traditional emerging market countries. As a result, the risks of investing in emerging market countries are magnified in frontier market countries. The magnification

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Notes to Financial Statements — as of October 31, 2013 (continued)

of risks are the result of: the potential for extreme price volatility and illiquidity in frontier markets; government ownership or control of parts of private sector and of certain companies; trade barriers, exchange controls, managed adjustments in relative currency values and other protectionist measures imposed or negotiated by the countries with which frontier market countries trade; and the relatively new and unsettled securities laws in many frontier market countries.

     Concentration of Credit Risk: The RMB Fixed Income Fund is likely to be more volatile than the performance of other mutual funds due to its focused investment in instruments having exposure to China. Because the Fund concentrates its investments in China, the Fund’s performance is expected to be closely tied to social, political, and economic conditions within China and to be more volatile than the performance of more geographically diversified funds.

Derivatives Risk: The term “derivatives” covers a broad range of investments, including futures and currency forwards. In general, a derivative refers to any financial instrument whose value is derived, at least in part, from the price of another security or a specified index, asset or rate. The use of derivatives presents risks different from, and possibly greater than, the risks associated with investing directly in traditional securities. The use of derivatives can lead to losses because of adverse movements in the price or value of the underlying asset, index or rate, which may be magnified by certain features of the derivatives. These risks are heightened when derivatives are used to enhance a Fund’s return or as a substitute for a position or security, rather than solely to hedge (or offset) the risk of a position or security held by a Fund. The success of a Fund’s derivatives strategies will also be affected by its ability to assess and predict the impact of market or economic developments on the underlying asset, index or rate and the derivative itself, without the benefit of observing the performance of the derivative under all possible market conditions. Derivatives involve the risk of mispricing or improper valuation and the risk that changes in the value of the derivative may not correlate perfectly with the underlying asset, index or rate. Certain derivative positions may be difficult to close out when a Fund’s portfolio manager may believe it would be appropriate to do so. Also, suitable derivative transactions may not be available in all circumstances and there can be no assurance that a Fund will engage in these transactions to reduce exposure to other risks when that would be beneficial.

Swap Risk: The use of swap agreements, which are agreements to exchange the return generated by one instrument for the return generated by another instrument (or index), and similar instruments involves risks that are different from those associated with ordinary portfolio securities transactions. For example, a Fund bears the risk of loss of the amount expected to be received under a swap agreement in the event of the default or bankruptcy of a swap agreement counterparty. Swap agreements may also subject a Fund to the risk that the counterparty to the transaction may not meet its obligations, causing the Fund’s value to decrease. Swap agreements may also be considered illiquid.

7. Federal Income Tax Information:

At October 31, 2013, the cost basis of securities for federal income tax purposes, gross unrealized appreciation, gross unrealized depreciation and net unrealized appreciation/depreciation were as follows:

								Net Unrealized
			Tax Unrealized		Tax Unrealized			Appreciation/
	Tax Cost ($)		Appreciation ($)		Depreciation ($)			(Depreciation) ($)*
Emerging Markets Debt Fund		42,144,821		965,867		(610,145	)		355,722
Emerging Markets Local Debt Fund		32,010,961		175,034		(2,182,460	)		(2,007,426	)
Frontier Markets Fund		83,433,339		5,979,059		(2,360,578	)		3,618,481
Total Return Fund		654,700,573		2,566,132		(13,890,426	)		(11,324,294	)
RMB Fixed Income Fund		13,124,458		566,388		(5,182	)		561,206

____________________
 

* The difference between book-basis unrealized appreciation (depreciation) is attributable primarily to tax deferral of losses on wash sales and the realization for tax purposes of unrealized gains/losses on investments in passive foreign investment companies.

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Notes to Financial Statements — as of October 31, 2013 (continued)

The tax character of dividends paid by the Funds as of the tax year ended October 31, 2013 was as follows:

	Dividends paid from
	Ordinary	Net Long Term		Total Taxable		Return of		Total Dividends
	Income ($)	Capital Gains ($)		Dividends ($)		Capital ($)		Paid ($)(1)
Emerging Markets Debt Fund	2,039,967		608,594		2,648,561		—		2,648,561
Emerging Markets Local Debt Fund	802,596		22,983		825,579		62,106		887,685
Frontier Markets Fund	649,627		—		649,627		—		649,627
Total Return Fund	4,959,505		—		4,959,505		—		4,959,505
RMB Fixed Income Fund	430,780		—		430,780		—		430,780

The tax character of dividends paid by the Funds as of the tax year ended October 31, 2012 was as follows:

	Dividends paid from
	Ordinary	Net Long Term	Total Taxable		Return of	Total Dividends
	Income ($)	Capital Gains ($)	Dividends ($)		Capital ($)	Paid ($)(1)
Emerging Markets Debt Fund	1,823,427	—		1,823,427	—		1,823,427
Emerging Markets Local Debt Fund	379,720	—		379,720	—		379,720
Frontier Markets Fund	29,081	—		29,081	—		29,081
Total Return Fund	783,622	—		783,622	—		783,622
RMB Fixed Income Fund	62,740	—		62,740	—		62,740

____________________
 

(1) Total dividends paid may differ from the amount reported in the Statement of Changes in Net Assets because dividends are recognized when actually paid for tax purposes.

As of the tax year ended October 31, 2013, the components of accumulated earnings/(deficit) on a tax basis for the Funds were as follows:

															Total
	Undistributed		Undistributed	Undistributed							Accumulated	Unrealized			Accumulated
	Ordinary		Tax Exempt	Long Term		Accumulated		Dividends			Capital and	Appreciation/			Earnings/
	Income ($)		Income ($)	Capital Gains ($)		Earnings ($)		Payable ($)*			Other Losses ($)	(Depreciation)($)			(Deficit) ($)
Emerging Markets
Debt Fund		256,931	—		650,922		907,853		(164,994	)	—		377,356			1,120,215
Emerging Markets
Local Debt Fund		—	—		—		—		(127,602	)	—		(2,037,448	)		(2,165,050	)
Frontier Markets
Fund		724,950	—		2,429,295		3,154,245		—		—		3,620,111			6,774,356
Total Return Fund		10,403,605	—		127,940		10,531,545		(647,053	)	—		(13,656,248	)		(3,771,756	)
RMB Fixed
Income Fund		113,692	—		—		113,692		(42,961	)	—		561,621			632,352

____________________
 

* Dividends payable may differ from the amount reported in the Statements of Assets and Liabilities because dividends payable on a tax basis include those dividends that will be reinvested.

During the latest tax year ended October 31, 2013, the following Fund utilized capital loss carryforwards to offset capital gains realized:

Fund	Amount ($)
Frontier Markets Fund	553,182

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Notes to Financial Statements — as of October 31, 2013 (continued)

8. Ownership and Principal Holders

     The beneficial ownership, either directly or indirectly, of more than 25% of the voting securities of a Fund creates presumptions of control of the Fund, under section 2 (a)(9) of the Act. As of October 31, 2013, the Emerging Markets Local Debt Fund and RMB Fixed Income Fund had individual shareholder accounts and/or omnibus shareholder accounts (comprised of a group of individual shareholders), each of which is affiliated with the Investment Adviser, and representing ownership in excess of 75% of each Fund, respectively.

9. Subsequent Events:

Management has evaluated events and transactions through the date the financial statements were issued, for purposes of recognition or disclosure in these financial statements and there are no subsequent events to report.

HSBC FAMILY OF FUNDS       69

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Trustees of
HSBC Funds:

We have audited the accompanying statements of assets and liabilities of HSBC Emerging Markets Debt Fund, HSBC Emerging Markets Local Debt Fund, HSBC Frontier Markets Fund, HSBC Total Return Fund and HSBC RMB Fixed Income Fund (the Funds), including the schedules of portfolio investments, as of October 31, 2013, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the years or periods in the two-year period then ended, and the financial highlights for each of the years or periods in the three-year period then ended. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the auditto obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of October 31, 2013, by correspondence with custodians and brokers or by other appropriate auditing procedures. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Funds as of October 31, 2013, the results of their operations for the year then ended, the changes in their net assets for each of the years or periods in the two-year period then ended, and the financial highlights for each of the years or periods in the three-year period then ended, in conformity with U.S. generally accepted accounting principles.

Columbus, Ohio
December 27, 2013

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Other Federal Income Tax Information — as of October 31, 2013 (Unaudited)

     During the year ended October 31, 2013, the following Funds declared capital gain distributions:

	Short Term		Long Term
	Capital Gain		Capital Gain
	Distributions ($)		Distributions ($)
Emerging Markets Debt Fund		176,091		608,594
Emerging Markets Local Debt Fund		413,214		22,983
Total Return Fund		995,672		—
RMB Fixed Income Fund		7		—

For the year ended October 31, 2013, dividends paid by the following Fund may be subject to a maximum tax rate of 15%, as provided for by the Jobs and Growth Tax Relief Reconciliation Act of 2003. The intends to designate the maximum amount allowable as taxed at a maximum rate of 15%.Complete information will be reported in conjunction with your 2013 Form 1099-DIV:

	Qualified
	Dividend
	Income (%)
Frontier Markets Fund	29.59

The following Funds intend to elect to pass through to shareholders the income tax credit for taxes paid to foreign countries. Foreign source income and foreign tax expense per outstanding share on October 31, 2013 are as follows:

	Foreign Source Income	Foreign Tax Expense
	Per Share ($)	Per Share ($)
Emerging Markets Local Debt Fund	0.40	0.01
Frontier Markets Fund	0.17	0.01

The pass-through of this foreign tax credit will only affect those persons who are shareholders on the dividend record date in December 2013. These shareholders will receive more detailed information along with their 2013 Form 1099-DIV.

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Table of Shareholder Expenses — as of October 31, 2013 (Unaudited)

     As a shareholder of the Funds, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, redemption fees and exchange fees; and (2) ongoing costs, including management fees, distribution fees and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare the cost with the ongoing costs of investing in other mutual funds.

These examples are based on an investment of $1,000 invested at the beginning of the period and held for the entire period from May 1, 2013 through October 31, 2013.

Actual Example

The table below provides information about actual account values and actual expenses. You may use the information below, 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 table under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

		Beginning								Annualized
		Account		Ending			Expenses Paid			Expense Ratio
		Value		Account Value			During Period*			During Period
		5/1/13		10/31/13			5/1/13 - 10/31/13			5/1/13 - 10/31/13
Emerging Markets Debt Fund	Class A		$1,000.00		$	944.70		$	5.88	1.20%
	Class I		1,000.00			945.40			4.17	0.85%
	Class S		1,000.00			945.90			3.68	0.75%
Emerging Markets Local Debt Fund	Class A		1,000.00			912.40			5.78	1.20%
	Class I		1,000.00			914.20			4.10	0.85%
	Class S		1,000.00			914.60			3.62	0.75%
Frontier Markets Fund	Class A		1,000.00			1,047.30			11.35	2.20%
	Class I		1,000.00			1,049.50			9.56	1.85%
Total Return Fund	Class A		1,000.00			990.20			7.93	1.58%
	Class I		1,000.00			992.90			6.18	1.23%
	Class S		1,000.00			993.40			5.68	1.13%
RMB Fixed Income Fund	Class A		1,000.00			1,019.30			7.38	1.45%
	Class I		1,000.00			1,021.00			5.60	1.10%
	Class S		1,000.00			1,021.50			5.10	1.00%

____________________
 

* Expenses are equal to the average account value over the period, multiplied by the Fund’s annualized expense ratio, multiplied by 184/365 (to reflect the one half year period).

72       HSBC FAMILY OF FUNDS

HSBC FAMILY OF FUNDS

Table of Shareholder Expenses — as of October 31, 2013 (Unaudited) (continued)

Hypothetical Example for Comparison Purposes

     The table below provides information about hypothetical account values and hypothetical expenses based on each 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 this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

										Annualized
		Beginning		Ending			Expenses Paid			Expense Ratio
		Account Value		Account Value			During Period*			During Period
		5/1/13		10/31/13			5/1/13 - 10/31/13			5/1/13 - 10/31/13
Emerging Markets Debt Fund	Class A		$1,000.00		$	1,019.16		$	6.11		1.20	%
	Class I		1,000.00			1,020.92			4.33		0.85	%
	Class S		1,000.00			1,021.42			3.82		0.75	%
Emerging Markets Local Debt Fund	Class A		1,000.00			1,019.16			6.11		1.20	%
	Class I		1,000.00			1,020.92			4.33		0.85	%
	Class S		1,000.00			1,021.42			3.82		0.75	%
Frontier Markets Fund	Class A		1,000.00			1,014.12			11.17		2.20	%
	Class I		1,000.00			1,015.88			9.40		1.85	%
Total Return Fund	Class A		1,000.00			1,017.24			8.03		1.58	%
	Class I		1,000.00			1,019.00			6.26		1.23	%
	Class S		1,000.00			1,019.51			5.75		1.13	%
RMB Fixed Income Fund	Class A		1,000.00			1,017.90			7.37		1.45	%
	Class I		1,000.00			1,019.66			5.60		1.10	%
	Class S		1,000.00			1,020.16			5.09		1.00	%

____________________
 

* Expenses are equal to the average account value over the period, multiplied by the Fund’s annualized expense ratio, multiplied by 184/365 (to reflect the one half year period).

HSBC FAMILY OF FUNDS       73

HSBC FAMILY OF FUNDS

Board of Trustees and Officers (Unaudited)

MANAGEMENT OF THE TRUST

     The following table contains information regarding the HSBC Family of Funds’ Board of Trustees (“Trustees”). Asterisks indicate those Trustees who are “interested persons,” as defined in the Investment Company Act of 1940, as amended, of the HSBC Family of Funds. The HSBC Family of Funds’ Statement of Additional Information includes additional information about the Trustees and is available, without charge, upon request by calling (888) 525-5757.

				Portfolios in
	Position(s)	Term of Office		Fund Complex	Other
Name,	Held with	and Length of	Principal Occupation(s)	Overseen By	Directorships
Address, Age	Funds	Time Served	During Past 5 Years	Trustee*	Held by Trustee
NON-INTERESTED
TRUSTEES
MARCIA L. BECK P.O. Box 182845 Columbus, OH 43218-3035 Age: 58	Trustee	Indefinite; 2008 to present	Private Investor (June 1999 – present); Executive Vice President, Prudential Investments (1997 – 1999); President and Trustee, The Goldman Sachs Mutual Funds (1992 – 1996)	21	None
SUSAN C. GAUSE P.O. Box 182845 Columbus, OH 43218-3035 Age: 60	Trustee	Indefinite; 2013 to present	Since 2003, Private Investor; Independent Trustee of Met Investors Series Trust (2008-2012); Chief Executive Officer, Dresdner RCM Global Investors and Allianz Dresdner Asset Management (2000-2002); Board Member of Dresdner Global Asset Management Board (2000-2002); Chief Operating Officer and Senior Managing Director of Dresdner RCM Global Investors (1998-2000)	21	Since 2012, Trustee, Metropolitan Series Fund
SUSAN S. HUANG P.O. Box 182845 Columbus, OH 43218-3035 Age: 59	Trustee	Indefinite; 2008 to present	Private Investor (2000- present); Senior Vice President, Schroder Investment Management (2001 – 2004); Managing Director, Chase Asset Management (1995-2000)	21	None
ALAN S. PARSOW P.O. Box 182845 Columbus, OH 43218-3035 Age: 63	Trustee	Indefinite; 1987 to present	General Partner, Elkhorn Partners, L.P. (a private investment partnership) (1989 – present)	21	None
THOMAS F. ROBARDS P.O. Box 182845 Columbus, OH 43218-3035 Age: 67	Trustee	Indefinite; 2005 to present	Partner, Robards & Co. LLC (investment and advisory services) (2005-present); Chief Financial Officer, American Museum of Natural History (2003-2004); Chief Financial Officer, Datek Online Holdings (2000-2003); Previously EVP and CFO Republic New York Corporation	21	Overseas Shipholding Group (energy transportation); Ellington Financial LLC (NYSE listed financial services); Ellington Residential Mortgage REIT (NYSE listed real estate investment trust)
MICHAEL SEELY P.O. Box 182845 Columbus, OH 43218-3035 Age: 68	Chairman and Trustee	Indefinite; 1987 to present	Private Investor (2003-present); General Partner, Global Multi Manager Partners (1999-2003); President of Investor Access Corporation (1981-2003)	21	None
INTERESTED TRUSTEE
DEBORAH HAZELL 452 Fifth Avenue New York NY 10018 Age: 50	Trustee	Indefinite; 2011 to present	CEO, HSBC Global Asset Management (USA) Inc. (2011-present); President and CEO, Fisher Francis Trees & Watts (“FFTW”) (investment advisor), February 2008-June 2011; Head of Client Service, Business Development and Marketing Group, FFTW (October 1999-February 2008)	21	None

____________________
 

* Includes the Trust, the HSBC Advisor Fund Trust and the HSBC Portfolios.

74       HSBC FAMILY OF FUNDS

HSBC FAMILY OF FUNDS

Board of Trustees and Officers (Unaudited) (continued)

	Position(s) Held	Term of Office and	Principal Occupation(s)
Name, Address, Age	Funds	Length of Time Served	During Past 5 Years
OFFICERS
RICHARD A. FABIETTI 452 Fifth Avenue New York, NY 10018 Age: 55	President	One year; 2004 to present	Senior Vice President, Head of Product Management, HSBC Global Asset Management (USA) Inc. (1998 - present)
STEPHEN SIVILLO 452 Fifth Avenue New York, NY 10018 Age: 42	Vice President	One year; 2010 to present	Vice President of Product Administration, HSBC Global Asset Management (USA) Inc. (2010 - present); Chief Compliance Officer, Managers Funds (2009 – 2010); Director, Mutual Fund Compliance, AllianceBernstein (2007-2009)
TY EDWARDS* 3435 Stelzer Road Columbus, OH 43219-3035 Age: 47	Treasurer	One year; 2010 to present	Senior Vice President, Citi Fund Services (2010– present); Director, Product Management, Columbia Management (2007-2009); Deputy Treasurer, Columbia Funds, (2006-2007)
JENNIFER A. ENGLISH* 100 Summer Street Suite 1500 Boston, MA 02110 Age: 41	Secretary	One year; 2008 to present	Senior Vice President, Regulatory Administration, Citi (2005 - present)
FREDERICK J. SCHMIDT* 1 Rexcorp Plaza Uniondale, NY 11556 Age: 54	Chief Compliance Officer	One year; 2004 to present	Director and Chief Compliance Officer, CCO Services, Citi (2004 - present)

____________________
 

* Mr. Edwards, Mr. Schmidt, and Ms. English also are officers of other investment companies of which Citi (or an affiliate) is the administrator or sub-administrator.

HSBC FAMILY OF FUNDS       75

Other Information (Unaudited):

     A description of the policies and procedures the Funds use to determine how to vote proxies relating to portfolio securities of each Fund, and information regarding how the Funds voted proxies relating to portfolio securities during the most recent 12-month period ended June 30th is available (i) without charge, upon request, by calling 1-800-525-5757 for HSBC Bank USA and HSBC Brokerage (USA) Inc. clients and 1-800-782-8183 for all other shareholders; (ii) on the Funds’ website at www.emfunds.us.hsbc.com or at www.investorfunds.us.hsbc.com; and (iii) on the Securities and Exchange Commission’s (“Commission”) website at http://www.sec.gov.

The Funds file their complete schedules of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Funds’ Forms N-Q are available on the Commission’s website at http://www.sec.gov. The Funds’ Forms N-Q may be reviewed and copied at the Commission’s Public Reference Room in Washington, D.C. and information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. The Funds’ Schedules of Investments will be available no later than 60 days after each period end, without charge, on the Funds’ website at www.emfunds.us.hsbc.com or at www.investorfunds.us.hsbc.com.

An investment in a Fund is not a deposit of HSBC Bank USA, N.A., and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency.

76       HSBC FAMILY OF FUNDS

HSBC FAMILY OF FUNDS: INVESTMENT ADVISER AND ADMINISTRATOR HSBC Global Asset Management (USA) Inc. 452 Fifth Avenue New York, NY 10018 SHAREHOLDER SERVICING AGENTS For HSBC Bank USA, N.A. and HSBC Securities (USA) Inc. Clients: HSBC Bank USA, N.A. 452 Fifth Avenue New York, NY 10018 1-888-525-5757 For All Other Shareholders: HSBC Funds P.O. Box 182845 Columbus, OH 43218 1-800-782-8183 TRANSFER AGENT Citi Fund Services 3435 Stelzer Road Columbus, OH 43219 DISTRIBUTOR Foreside Distribution Services, L.P. 690 Taylor Road, Suite 150 Gahanna, Ohio 43230

CUSTODIAN The Northern Trust Company 50 South LaSalle Street Chicago, IL 60603 INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM KPMG LLP 191 West Nationwide Blvd., Suite 500 Columbus, OH 43215 LEGAL COUNSEL Dechert LLP 1900 K Street, N.W. Washington, D.C. 20006

Investment products:

ARE NOT A BANK DEPOSIT OR OBLIGATION OF THE BANK OR ANY OF ITS AFFILIATES	ARE NOT FDIC INSURED	ARE NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY
ARE NOT GUARANTEED BY THE BANK OR ANY OF ITS AFFILIATES		MAY LOSE VALUE

Investment products are offered by HSBC Securities (USA) Inc. (HSI), member NYSE/FINRA/SIPC. HSI is an affiliate of HSBC Bank USA, N.A. Investment products: Are not a deposit or other obligation of the bank or any of its affiliates; Not FDIC insured or insured by any federal government agency of the United States; Not guaranteed by the bank or any of its affiliates; and are subject to investment risk, including possible loss of principal invested.

HSB-AR-EM-1213 12/13

HSBC Global Asset Management (USA) Inc.

HSBC World Selection^™ Funds
Annual Report
October 31, 2013

WORLD SELECTION FUNDS	Class A	Class B	Class C
Aggressive Strategy Fund	HAAGX	HBAGX	HCAGX
Balanced Strategy Fund	HAGRX	HSBGX	HCGRX
Moderate Strategy Fund	HSAMX	HSBMX	HSCMX
Conservative Strategy Fund	HACGX	HBCGX	HCCGX
Income Strategy Fund	HINAX	HINBX	HINCX

Table of Contents

HSBC World Selection Funds

Annual Report - October 31, 2013

Glossary of Terms
President’s Message	4
Commentary From the Investment Manager	5
Portfolio Reviews	6
Portfolio Composition	16
Schedules of Portfolio Investments
Aggressive Strategy Fund	18
Balanced Strategy Fund	19
Moderate Strategy Fund	20
Conservative Strategy Fund	21
Income Strategy Fund	22
Statements of Assets and Liabilities	23
Statements of Operations	24
Statements of Changes in Net Assets	25
Financial Highlights	31
Notes to Financial Statements	36
Report of Independent Registered Public Accounting Firm	46
Other Federal Income Tax Information	47
Table of Shareholder Expenses	48
HSBC Portfolios
Schedules of Portfolio Investments
HSBC Growth Portfolio	50
HSBC Opportunity Portfolio	52
Statements of Assets and Liabilities	54
Statements of Operations	55
Statements of Changes in Net Assets	56
Financial Highlights	57
Notes to Financial Statements	58
Report of Independent Registered Public Accounting Firm	63
Table of Shareholder Expenses	64
Board of Trustees and Officers	65
Other Information	67

The World Selection Funds (the “Funds”) are “fund of funds” which aim to provide superior risk adjusted returns relative to a single asset class investment over the long term by investing primarily in underlying funds. The underlying funds may include mutual funds managed by HSBC Global Asset Management (USA) Inc. (the “Adviser”), mutual funds managed by investment advisers that are not associated with the Adviser and exchange traded funds (“ETFs”) (collectively, “Underlying Funds”). The Funds may also purchase or hold exchange traded notes (“ETNs”). The Funds’ broadly diversified investment approach across various asset classes and investment styles aims to contribute to achieving their objectives. Each World Selection Fund has a strategic asset allocation which represents a carefully constructed blend of asset classes, regions and currencies to meet longer term investment goals.

Glossary of Terms

Barclays U.S. Aggregate Bond Index is an unmanaged index generally representative of investment-grade, USD-denominated, fixed-rate debt issues, taxable bond market, including Treasuries, government-related and corporate securities, asset-backed, mortgage-backed and commercial mortgage-backed securities, with maturities of at least one year.

Barclays U.S. Corporate High-Yield Bond Index is an unmanaged index that measures the non-investment grade, USD-denominated, fixed-rate, taxable corporate bond market. Securities are classified as high-yield if the middle rating of Moody’s, Fitch, and S&P is Ba1/BB+/BB+ or below. The index excludes emerging markets debt.

BofA Merrill Lynch U.S. High Yield Master II Index is an unmanaged index that tracks the performance of USD-denominated, below investment grade corporate debt publicly issued in the U.S. domestic market.

Citigroup U.S. Domestic 3-Month Treasury Bill Index is an unmanaged market value-weighted index of public obligations of the U.S. Treasury with maturities of three months.

Gross Domestic Product (“GDP”) measures the market value of the goods and services produced by labor and property in the United States.

Morgan Stanley Capital International Europe Australasia and Far East (“MSCI EAFE”) Index is an unmanaged equity index which captures large and mid cap representation across Developed Markets countries: Australia, Austria, Belgium, Denmark, Finland, France, Germany, Greece, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland and the UK (excluding the US and Canada). With 910 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.

Morgan Stanley Capital International Emerging Market (“MSCI EM”) Index is an unmanaged index that captures large and mid cap representation across 21 Emerging Markets (EM) countries: Brazil, Chile, China, Colombia, Czech Republic, Egypt, Hungary, India, Indonesia, Korea, Malaysia, Mexico, Morocco, Peru, Philippines, Poland, Russia, South Africa, Taiwan, Thailand and Turkey. With 818 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.

Russell 2000^® Index is an unmanaged index that measures the performance of the small-cap segment of the U.S. equity universe. The Russell 2000^® Index is a subset of the Russell 3000^® Index representing approximately 10% of the total market capitalization of that index. It includes approximately 2000 of the smallest securities based on a combination of their market cap and current index membership.

Standard & Poor’s 500 (“S&P 500”) Index is an unmanaged index that is widely regarded as a gauge of the U.S. equities market. This index includes 500 leading companies in leading industries of the U.S. economy. The S&P 500 Index focuses on the large-cap segment of the market, with approximately 75% coverage of U.S. equities.

Securities indices assume reinvestment of all distributions and interest payments and do not take in account brokerage fees or expenses. Securities in the Funds do not match those in the indices and performance of the Funds will differ. Investors cannot invest directly in an index.

President’s Message

Dear Shareholder,

We are pleased to send to you the HSBC Funds annual report, covering the fiscal year ended October 31, 2013. This report contains detailed information about your Funds’ portfolio of investments and operating results. We encourage you to review it carefully.

This report includes commentary from the Funds’ portfolio managers in which they discuss the investment markets and their respective Fund’s performance. The portfolio manager commentary is accompanied by the Fund’s return for the period, listed alongside the returns of its benchmark index and peer group average for comparative purposes.

In closing, we would like to thank you for investing in the HSBC Funds. We continue to focus the HSBC Fund Family on investment solutions to assist our shareholders in reaching their financial goals. We appreciate the trust you place in us, and will continue working to earn it. Please contact us at any time with questions or concerns.

Sincerely,

 

Richard A. Fabietti

President

4       HSBC FAMILY OF FUNDS

Commentary From the Investment Manager

HSBC Global Asset Management (USA) Inc.

U.S. Economic Review

Economic growth picked up pace in developing economies throughout the world during the 12-month period between November 1, 2012 and October 31, 2013. Many major economies, including the United States, reported improved economic data during the period, indicating new momentum for a modest but sustained recovery. The U.S. equity markets made strong gains during the period, boosted by improvements in the labor and housing markets and healthy corporate profits. Markets continued to benefit from the Federal Reserve Board’s (the “Fed”) decision to maintain the federal funds rate—a key factor in lending rates—at a historically low target range between 0.00% and 0.25%. Economic headwinds remained, however, including relatively high unemployment in some areas, low consumer spending and reduced government spending caused by sequestration.

Investor confidence declined mid-year due in part to expectations that the Fed would begin tapering its bond purchasing program. Concerns about the impact of tapering diminished, however, when the Fed announced in September that it would delay winding down its stimulus efforts until the unemployment rate fell significantly lower. The first shutdown of the U.S. government in 17 years occurred in October. This political crisis, along with the related standoff over raising the country’s borrowing limit, was another factor weighing on investor sentiment. The uncertainty surrounding the crisis dragged on equities, although markets regained momentum once a political deal was struck that reopened the government and raised the debt ceiling. Broad U.S. stock market indices ended the period significantly above where they were positioned 12 months earlier.

Improving political circumstances in the eurozone and positive economic data helped boost stocks in developed economies across the world. The economies of both Japan and Europe transitioned out of recession. Progress was made toward alleviating the sovereign debt crisis in Europe. The European Central Bank’s aggressive efforts, including its government bond-buying program known as Outright Monetary Transactions, reassured investors. Still, many developments in Europe revealed ongoing economic weaknesses, including a controversial bailout in Cyprus, political uncertainty in Italy and high unemployment throughout the eurozone.

Economic growth in many emerging markets slowed during the period, as concerns grew about rising inflation and potential decreases in global liquidity. In addition, signs of softening in China’s economy led to a fall in commodity prices, which dragged on stocks throughout emerging markets. Central banks in both India and Brazil fought rising inflation by raising interest rates.

The recovery of the U.S. housing market remained robust. New home sales and housing starts increased, though the pace of growth slowed late in the period. Although the unemployment rate gradually edged downward, it remained well above pre-recession levels. Moreover, the number of long-term unemployed individuals, including those who dropped out of the labor market entirely, remained high. Real income grew at a modest pace, but consumer spending remained weak, consumer confidence dropped sharply and personal savings rates slowed. Economic activity in the manufacturing sector expanded during the period, though the rate of growth slowed.

U.S. Gross Domestic Product¹ growth increased each quarter during the period, expanding at a rate of 0.1% during the fourth quarter of 2012 and quickening to a rate of 2.8% in the third quarter of 2013, according to preliminary estimates.

Market Review

The period began with U.S. markets retreating slightly due to the political face-off over the “fiscal cliff” and concerns about ongoing turmoil related to eurozone sovereign debt.

Equities then regained momentum in the first quarter of 2013 and began a steady rally that persisted through the duration of the period with only a few brief interruptions. The strong performance of equities was undeterred by uncertainty about government policy and concerns that the onset of automatic budget cuts—known as sequestration—would undermine economic growth. A political compromise that avoided the direst consequences of the fiscal cliff, along with improvement in the housing market, helped buoy investor confidence and fuel gains in the equity markets.

During the middle of the period equity prices fell as investors anticipated an imminent decrease in central bank liquidity. Stocks rebounded after the Fed delayed tapering its bond-purchasing program, with the S&P 500 Index¹ hitting a then-record high following the announcement. Equities ended the period in a rally that was spurred by the political deal that partially resolved the government shutdown and a second standoff over the debt ceiling.

Small- and mid-cap stocks outperformed large-cap stocks during the period, and emerging markets generally underperformed developed economies. The Russell 2000^® Index¹ of small-company stocks returned 36.28% and the MSCI Emerging Market Index¹ of emerging market stocks returned 6.90%.

Stocks in developed economies rose. Japanese equities performed well due to optimism regarding its central bank’s ambitious monetary easing schedule, which aimed to double the size of the monetary base over the next two years. International stocks made strong gains, slightly outperforming U.S. markets. The S&P 500 Index of large-company U.S. stocks returned 27.18% for the 12 months through October 2013. That compared to a 27.40% return for the MSCI EAFE Index¹ of international stocks in developed markets.

Rising interest rates, widening credit spreads and uncertainty about government policy resulted in weak performance in the U.S. fixed-income market during the period. Yields on U.S. Treasury bonds increased during the period, sending prices lower. Investment-grade corporate bonds also declined. Investors sought the more attractive yields offered by high-yield corporate bonds and high-yield municipal bonds, which were among the best-performing fixed-income sectors during the period. The Barclays U.S. Aggregate Bond Index¹, which tracks the broad investment-grade fixed-income market, returned -1.08% for the 12 months through October, while the Barclays U.S. Corporate High-Yield Bond Index¹ returned 8.87%. Fixed-income markets in Europe generated modest returns, while fixed-income in emerging markets ended the period significantly lower, despite a modest rebound in the final months of the period.

1     For additional information, please refer to the Glossary of Terms.

HSBC FAMILY OF FUNDS       5

Portfolio Reviews (Unaudited)

Aggressive Strategy Fund

(Class A Shares, Class B Shares and Class C Shares)

by Randeep Brar, CFA, Senior Vice President/Portfolio Manager
Caroline Hitch, Senior Portfolio Manager

The Aggressive Strategy Fund (the “Fund”) is a “fund of funds” which seeks long-term growth of capital by investing primarily in underlying funds. The underlying funds may include mutual funds managed by HSBC Global Asset Management (USA) Inc. (the “Adviser”), mutual funds managed by investment advisers that are not associated with the Adviser and exchange traded funds (“ETFs”) (collectively, “Underlying Funds”). The Fund may also purchase or hold exchange traded notes (“ETNs”).

Investment Concerns

Allocation Risk: The risk that the Adviser’s target asset and sector allocations and changes in target asset and sector allocations cause the Fund to underperform other similar funds or cause you to lose money, and that the Fund may not achieve its target asset and sector allocations.

Underlying Fund Selection Risk: The risk that the Fund may invest in Underlying Funds that underperform other similar funds or the markets more generally, due to poor investment decisions by the investment adviser(s) for the Underlying Funds or otherwise. Underlying Funds also have their own expenses, which the Fund bears in addition to its own expenses.

Equity Securities Risk: A portion of the assets of the Fund is allocated to Underlying Funds investing primarily in equity securities. Therefore, the value of the Fund may increase or decrease as a result of its indirect interest in equity securities.

Fixed Income Securities Risk: A portion of the assets of the Fund is allocated to Underlying Funds investing primarily in fixed income securities. Therefore, the value of the Fund may increase or decrease as a result of its indirect interest in fixed income securities.

Foreign Securities/Emerging Markets Risk: Foreign securities, including those of emerging market issuers, are subject to additional risks including international trade, currency, political, and regulatory risks. Securities of emerging market issuers generally have more risk than securities issued by issuers in more developed foreign markets. For a complete description of these and other risks associated with investment in a mutual fund, please refer to the Fund’s prospectus.

Market Commentary

The Fund returned 22.38% (without sales charge) for the Class A Shares for the year ended October 31, 2013. That compared to a 27.18% total return for the Fund’s primary benchmark, the S&P 500 Index¹.

The Fund measures performance against several additional reference indices for the year ended October 31, 2013: the MSCI EAFE Index¹ (27.40% total return), Barclays U.S. Aggregate Bond Index¹ (-1.08% total return), Bank of America/Merrill Lynch U.S. High Yield Master II Index¹ (8.83% total return) and Citigroup U.S. Domestic 3-Month Treasury Bill Index¹ (0.06% total return).

Portfolio Performance

Economic activity across the developed world gained momentum during the 12 months through October 31, 2013. Accommodative monetary policies in the U.S., Europe, and Japan helped fuel modest economic growth, and investors’ appetites for riskier asset classes such as equities grew during the period.

However, global financial markets closely watched U.S. policy developments during the period. In particular, the U.S. Federal Reserve (the Fed) signaled midway through the period that it might begin tapering its ongoing stimulus efforts. That led to considerable volatility in the global financial markets. However, market sentiment surged later in the period when the Fed announced it would keep its stimulus efforts intact.

In Europe, considerable progress was made in bringing the eurozone debt crisis under control. In the second quarter of 2013, the eurozone economy grew by an estimated 0.3%, ending a period of six consecutive quarters of recession.

Emerging markets lagged their developed market peers during the period. Such markets were very sensitive to Fed policy and the prospect of declining global liquidity if accommodative monetary policies were tightened.

The Fund did benefit from its overweight position in U.S. and international equities. However, as the Fund is a multi-asset portfolio and includes many asset classes to achieve its risk/return profile, the Fund did not capture the full benefit of the strong performance of U.S. and international equities. At the same time, the Fund performed better than its reference fixed-income indices, including the Barclays U.S. Aggregate Bond Index, which performed poorly during the 12-month period.

In this environment, the Fund was positioned with a modest overweight in developed market equities. We believed developed market equities offered appealing valuations, particularly compared to developed market government bonds, which were trading at historically low yields. The Fund’s allocation to domestic equities was the primary driver of returns during the period. In addition, the Fund benefited from its neutral weighting to emerging markets equities, as such stocks considerably underperformed their developed market peers during the period.

The Fund began the period with an underweight position in U.S. aggregate bonds, and its exposure to these bonds was reduced several times during the period as Treasury yields remained at historical lows. That strategy added value to the Fund’s overall performance during the period. Additionally, the Fund benefited from its overweight position in U.S. high-yield credit, as investors searching for yield sparked demand for such securities.

The portfolio’s exposure to alternative investments was little changed during the period. The Fund benefited from an underweight position in commodities, which performed very poorly. An overweight position in property benefited the Fund, as did the portfolio’s private equity allocation, which performed very well during the period.^†

†	Portfolio composition is subject to change.
1	For additional information, please refer to the Glossary of Terms.

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

6       HSBC FAMILY OF FUNDS

Portfolio Reviews (Unaudited)

Aggressive Strategy Fund

The charts above represent a historical since inception performance comparison of a hypothetical $10,000 investment in the indicated share class versus a similar investment in the Fund’s benchmark and represents the reinvestment of dividends and capital gains in the Fund.

			Average Annual					Expense
Fund Performance			Total Return (%)					Ratio (%)4
	Inception		1		5	Since
As of October 31, 2013	Date		Year		Year	Inception		Gross	Net
Aggressive Strategy Fund Class A1		2/14/05	16.28		11.84	5.67		2.26	2.10
Aggressive Strategy Fund Class B2		2/9/05	17.44		12.14	5.77		3.01	2.85
Aggressive Strategy Fund Class C3		6/9/05	20.45	7	12.16	6.06		3.01	2.85
S&P 500 Index5		—	27.18		15.17	6.76	6	N/A	N/A
MSCI EAFE Index5		—	27.40		12.52	6.12	6	N/A	N/A
Barclays U.S. Aggregate Bond Index5		—	-1.08		6.09	4.67	6	N/A	N/A
BofA Merrill Lynch U.S. High Yield Master II Index5		—	8.83		18.03	8.22	6	N/A	N/A
Citigroup U.S. Domestic 3-Month Treasury Bill Index5		—	0.06		0.12	1.66	6	N/A	N/A

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect the taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower. Currently, contractual fee waivers are in effect for the Fund through March 1, 2014.

Certain returns shown include monies received by series of HSBC Portfolios (the “Portfolios”), in which the Fund invests, in respect of one-time class action settlements. As a result, the Fund’s total returns for those periods were higher than they would have been had the Portfolios not received the payments.

1	Reflects the maximum sales charge of 5.00%.
2	Reflects the applicable contingent deferred sales charge, maximum of 4.00%.
3	Reflects the applicable contingent deferred sales charge, maximum of 1.00%.
4	Reflects the expense ratios as reported in the prospectus dated February 28, 2013. The Adviser has entered into a contractual expense limitation agreement with the Fund under which it will limit total expenses of the Fund (excluding interest, taxes, brokerage commissions, extraordinary expenses and estimated indirect expenses attributable to the Fund’s investments in investment companies other than the HSBC Growth Portfolio and the HSBC Opportunity Portfolio) to an annual rate of 1.50%, 2.25%, and 2.25% for Class A Shares, Class B Shares and Class C Shares, respectively. The expense limitation shall be in effect until March 1, 2014. The expense ratios reflected include Acquired Fund fees and expenses. Additional information pertaining to the October 31, 2013 expense ratios can be found in the financial highlights.
5	For additional information, please refer to the Glossary of Terms.
6	Return for the period February 9, 2005 to October 31, 2013.
7	The recent appreciation in the stock market has helped to produce short-term returns that are not typical and may not continue in the future. Because of ongoing market volatility, fund performance may be subject to substantial short-term changes.

The Fund’s performance is primarily measured against the S&P 500 Index, an unmanaged index that is widely regarded as a gauge of the U.S. equities market. This index includes 500 leading companies in leading industries of the U.S. economy. Although the S&P 500 Index focuses on the large-cap segment of the market, with approximately 75% coverage of U.S. equities, it is also an ideal proxy for the total market. The performance of the index does not reflect the deduction of expenses associated with a mutual fund, such as investment management and fund accounting fees. The Fund’s performance reflects the deduction of fees for these value-added services. Investors cannot invest directly in an index.

HSBC FAMILY OF FUNDS       7

Portfolio Reviews (Unaudited)

Balanced Strategy Fund

(Class A Shares, Class B Shares and Class C Shares)

by Randeep Brar, CFA, Senior Vice President/Portfolio Manager
Caroline Hitch, Senior Portfolio Manager

The Balanced Strategy Fund (the “Fund”) is a “fund of funds” which seeks long-term growth of capital by investing primarily in underlying funds. The underlying funds may include mutual funds managed by HSBC Global Asset Management (USA) Inc. (the “Adviser”), mutual funds managed by investment advisers that are not associated with the Adviser and exchange traded funds (“ETFs”) (collectively, “Underlying Funds”). The Fund may also purchase or hold exchange traded notes (“ETNs”).

Investment Concerns

Allocation Risk: The risk that the Adviser’s target asset and sector allocations and changes in target asset and sector allocations cause the Fund to underperform other similar funds or cause you to lose money, and that the Fund may not achieve its target asset and sector allocations.

Underlying Fund Selection Risk: The risk that the Fund may invest in Underlying Funds that underperform other similar funds or the markets more generally, due to poor investment decisions by the investment adviser(s) for the Underlying Funds or otherwise. Underlying Funds also have their own expenses, which the Fund bears in addition to its own expenses.

Equity Securities Risk: A portion of the assets of the Fund is allocated to Underlying Funds investing primarily in equity securities. Therefore, the value of the Fund may increase or decrease as a result of its indirect interest in equity securities.

Fixed Income Securities Risk: A portion of the assets of the Fund is allocated to Underlying Funds investing primarily in fixed income securities. Therefore, the value of the Fund may increase or decrease as a result of its indirect interest in fixed income securities.

Foreign Securities/Emerging Markets Risk: Foreign securities, including those of emerging market issuers, are subject to additional risks including international trade, currency, political, and regulatory risks. Securities of emerging market issuers generally have more risk than securities issued by issuers in more developed foreign markets. For a complete description of these and other risks associated with investment in a mutual fund, please refer to the Fund’s prospectus.

Market Commentary

The Fund returned 15.76% (without sales charge) for the Class A Shares for the year ended October 31, 2013. That compared to a 27.18% total return for the Fund’s primary benchmark, the S&P 500 Index¹.

The Fund measures performance against several additional reference indices for the year ended October 31, 2013: the MSCI EAFE Index¹ (27.40% total return), Barclays U.S. Aggregate Bond Index¹ (-1.08% total return), Bank of America/Merrill Lynch U.S. High Yield Master II Index¹ (8.83% total return) and Citigroup U.S. Domestic 3-Month Treasury Bill Index¹ (0.06% total return).

Portfolio Performance

Economic activity across the developed world gained momentum during the 12 months through October 31, 2013. Accommodative monetary policies in the U.S., Europe, and Japan helped fuel modest economic growth, and investors’ appetites for riskier asset classes such as equities grew during the period.

However, global financial markets closely watched U.S. policy developments during the period. In particular, the U.S. Federal Reserve (the Fed) signaled midway through the period that it might begin tapering its ongoing stimulus efforts. That led to considerable volatility in the global financial markets. However, market sentiment surged later in the period when the Fed announced it would keep its stimulus efforts intact.

In Europe, considerable progress was made in bringing the eurozone debt crisis under control. In the second quarter of 2013, the eurozone economy grew by an estimated 0.3%, ending a period of six consecutive quarters of recession.

Emerging markets lagged their developed market peers during the period. Such markets were very sensitive to Fed policy and the prospect of declining global liquidity if accommodative monetary policies were tightened.

The Fund did benefit from its overweight position in U.S. and international equities. However, as the Fund is a multi-asset portfolio and includes many asset classes to achieve its risk/return profile, the Fund did not capture the full benefit of the strong performance of U.S. and international equities. At the same time, the Fund performed better than its reference fixed-income indices, including the Barclays U.S. Aggregate Bond Index, which performed poorly during the 12-month period.

In this environment, the Fund was positioned with a modest overweight in developed market equities. We believed developed market equities offered appealing valuations, particularly compared to developed market government bonds, which were trading at historically low yields. The Fund’s allocation to domestic equities was the primary driver of returns during the period. Additionally, the Fund benefited from its neutral weighting to emerging markets equities, as such stocks considerably underperformed their developed market peers during the period.

The Fund began the period with an underweight position in U.S. aggregate bonds, and its exposure to these bonds was reduced several times during the period as Treasury yields remained at historical lows. That strategy added value to the Fund’s overall performance during the period. The Fund also benefited from its overweight positions in U.S. investment grade and high-yield credit, and its exposure to both hard and local currency emerging markets debt.

The portfolio’s exposure to alternative investments was little changed during the period. The Fund benefited from an underweight position in commodities, which performed very poorly. An overweight position in property benefited the Fund, as did the portfolio’s private equity allocation, which performed very well during the period.^†

†	Portfolio composition is subject to change.
1	For additional information, please refer to the Glossary of Terms.

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

8       HSBC FAMILY OF FUNDS

Portfolio Reviews (Unaudited)

Balanced Strategy Fund

The charts above represent a historical since inception performance comparison of a hypothetical $10,000 investment in the indicated share class versus a similar investment in the Fund’s benchmark and represents the reinvestment of dividends and capital gains in the Fund.

		Average Annual				Expense
Fund Performance		Total Return (%)				Ratio (%)4
	Inception	1	5	Since
As of October 31, 2013	Date	Year	Year	Inception		Gross	Net
Balanced Strategy Fund Class A1	2/8/05	9.94	11.24	5.68		1.77	1.77
Balanced Strategy Fund Class B2	2/1/05	10.89	11.52	5.87		2.52	2.52
Balanced Strategy Fund Class C3	4/27/05	13.87	11.52	6.17		2.52	2.52
S&P 500 Index5	—	27.18	15.17	6.78	6	N/A	N/A
MSCI EAFE Index5	—	27.40	12.52	6.10	6	N/A	N/A
Barclays U.S. Aggregate Bond Index5	—	-1.08	6.09	4.75	6	N/A	N/A
BofA Merrill Lynch U.S. High Yield Master II Index5	—	8.83	18.03	8.31	6	N/A	N/A
Citigroup U.S. Domestic 3-Month Treasury Bill Index5	—	0.06	0.12	1.65	6	N/A	N/A

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect the taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower.

Certain returns shown include monies received by series of HSBC Portfolios (the “Portfolios”), in which the Fund invests, in respect of one-time class action settlements. As a result, the Fund’s total returns for those periods were higher than they would have been had the Portfolios not received the payments.

1	Reflects the maximum sales charge of 5.00%.
2	Reflects the applicable contingent deferred sales charge, maximum of 4.00%.
3	Reflects the applicable contingent deferred sales charge, maximum of 1.00%.
4	Reflects the expense ratios as reported in the prospectus dated February 28, 2013. The expense ratios reflected include Acquired Fund fees and expenses. Additional information pertaining to the October 31, 2013 expense ratios can be found in the financial highlights.
5	For additional information, please refer to the Glossary of Terms.
6	Return for the period February 1, 2005 to October 31, 2013.

The Fund’s performance is primarily measured against the S&P 500 Index, an unmanaged index that is widely regarded as a gauge of the U.S. equities market. This index includes 500 leading companies in leading industries of the U.S. economy. Although the S&P 500 Index focuses on the large-cap segment of the market, with approximately 75% coverage of U.S. equities, it is also an ideal proxy for the total market. The performance of the index does not reflect the deduction of expenses associated with a mutual fund, such as investment management and fund accounting fees. The Fund’s performance reflects the deduction of fees for these value-added services. Investors cannot invest directly in an index.

HSBC FAMILY OF FUNDS       9

Portfolio Reviews (Unaudited)

Moderate Strategy Fund
(Class A Shares, Class B Shares and Class C Shares)

by Randeep Brar, CFA, Senior Vice President/Portfolio Manager
Caroline Hitch, Senior Portfolio Manager

The Moderate Strategy Fund (the “Fund”) is a “fund of funds” which seeks long-term growth of capital by investing primarily in underlying funds. The underlying funds may include mutual funds managed by HSBC Global Asset Management (USA) Inc. (the “Adviser”), mutual funds managed by investment advisers that are not associated with the Adviser and exchange traded funds (“ETFs”) (collectively, “Underlying Funds”). The Fund may also purchase or hold exchange traded notes (“ETNs”).

Investment Concerns

Allocation Risk: The risk that the Adviser’s target asset and sector allocations and changes in target asset and sector allocations cause the Fund to underperform other similar funds or cause you to lose money, and that the Fund may not achieve its target asset and sector allocations.

Underlying Fund Selection Risk: The risk that the Fund may invest in Underlying Funds that underperform other similar funds or the markets more generally, due to poor investment decisions by the investment adviser(s) for the Underlying Funds or otherwise. Underlying Funds also have their own expenses, which the Fund bears in addition to its own expenses.

Equity Securities Risk: A portion of the assets of the Fund is allocated to Underlying Funds investing primarily in equity securities. Therefore, the value of the Fund may increase or decrease as a result of its indirect interest in equity securities.

Fixed Income Securities Risk: A portion of the assets of the Fund is allocated to Underlying Funds investing primarily in fixed income securities. Therefore, the value of the Fund may increase or decrease as a result of its indirect interest in fixed income securities.

Foreign Securities/Emerging Markets Risk: Foreign securities, including those of emerging market issuers, are subject to additional risks including international trade, currency, political, and regulatory risks. Securities of emerging market issuers generally have more risk than securities issued by issuers in more developed foreign markets. For a complete description of these and other risks associated with investment in a mutual fund, please refer to the Fund’s prospectus.

Market Commentary

The Fund returned 10.80% (without sales charge) for the Class A Shares for the year ended October 31, 2013. That compared to a -1.08% total return for the Fund’s primary benchmark, the Barclays U.S. Aggregate Bond Index¹.

The Fund measures performance against several additional reference indices for the year ended October 31, 2013: the S&P 500 Index¹ (27.18% total return), MSCI EAFE Index¹ (27.40% total return), Bank of America/Merrill Lynch U.S. High Yield Master II Index¹ (8.83% total return) and Citigroup U.S. Domestic 3-Month Treasury Bill Index¹ (0.06% total return).

Portfolio Performance

Economic activity across the developed world gained momentum during the 12 months through October 31, 2013. Accommodative monetary policies in the U.S., Europe and Japan helped fuel modest economic growth, and investors’ appetites for riskier asset classes such as equities grew during the period.

However, global financial markets closely watched U.S. policy developments during the period. In particular, the U.S. Federal Reserve (the “Fed”) signaled midway through the period that it may begin tapering its ongoing stimulus efforts, including its large-scale purchases of assets such as Treasury bonds. That led to considerable volatility in the global financial markets. However, market sentiment surged later in the period when the Fed announced it would keep its stimulus efforts intact.

In Europe, considerable progress was made in bringing the eurozone debt crisis under control. In the second quarter of 2013, the eurozone economy grew by an estimated 0.3%, ending a period of six consecutive quarters of recession. Additionally, Japanese equities performed extremely well during the period thanks in large part to government stimulus efforts in that country.

Emerging markets lagged their developed market peers during the period. Such markets were very sensitive to Fed policy and the prospect of declining global liquidity if accommodative monetary policies were tightened. What’s more, a number of prominent emerging economies also had to contend with growth and inflation concerns. For instance, economic activity in China—the world’s largest emerging economy—showed signs of softening before posting strong growth late in the period.

In this environment, the Fund was positioned with a modest overweight in developed market equities. We believed developed market equities offered appealing valuations, particularly compared to developed market government bonds, which were trading at historically low yields. The Fund’s allocation to domestic equities was the primary driver of returns during the period. The Fund also benefited from its neutral weighting to emerging markets equities, as such stocks considerably underperformed their developed market peers during the period.^†

The Fund began the period with an underweight position in U.S. aggregate bonds, and its exposure to these bonds was reduced several times during the period as Treasury yields remained at historical lows. That strategy added value to the Fund’s overall performance. The Fund benefited from its overweight positions in U.S. investment grade and high-yield credit, and its exposure to both hard and local currency emerging markets debt.^†

There was very little change to the portfolio’s exposure to alternative investments during the period. The Fund benefited from an underweight position in commodities, which performed very poorly. An overweight position in property benefited the Fund, as did the portfolio’s private equity allocation, which performed very well during the period.^†

†	Portfolio composition is subject to change.
1	For additional information, please refer to the Glossary of Terms.

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

10       HSBC FAMILY OF FUNDS

Portfolio Reviews (Unaudited)

Moderate Strategy Fund

The charts above represent a historical since inception performance comparison of a hypothetical $10,000 investment in the indicated share class versus a similar investment in the Fund’s benchmark and represents the reinvestment of dividends and capital gains in the Fund.

		Average Annual				Expense
Fund Performance		Total Return (%)				Ratio (%)4
	Inception	1	5	Since
As of October 31, 2013	Date	Year	Year	Inception		Gross	Net
Moderate Strategy Fund Class A1	2/3/05	5.22	9.77	4.98		1.79	1.79
Moderate Strategy Fund Class B2	2/1/05	6.04	10.09	5.12		2.54	2.54
Moderate Strategy Fund Class C3	6/9/05	8.96	10.09	5.13		2.54	2.54
Barclays U.S. Aggregate Bond Index5	—	-1.08	6.09	4.75	6	N/A	N/A
S&P 500 Index5	—	27.18	15.17	6.78	6	N/A	N/A
MSCI EAFE Index5	—	27.40	12.52	6.10	6	N/A	N/A
BofA Merrill Lynch U.S. High Yield Master II Index5	—	8.83	18.03	8.31	6	N/A	N/A
Citigroup U.S. Domestic 3-Month Treasury Bill Index5	—	0.06	0.12	1.65	6	N/A	N/A

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect the taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower.

Certain returns shown include monies received by series of HSBC Portfolios (the “Portfolios”), in which the Fund invests, in respect of one-time class action settlements. As a result, the Fund’s total returns for those periods were higher than they would have been had the Portfolios not received the payments.

1	Reflects the maximum sales charge of 5.00%.
2	Reflects the applicable contingent deferred sales charge, maximum of 4.00%.
3	Reflects the applicable contingent deferred sales charge, maximum of 1.00%.
4	Reflects the expense ratios as reported in the prospectus dated February 28, 2013. The expense ratios reflected include Acquired Fund fees and expenses. Additional information pertaining to the October 31, 2013 expense ratios can be found in the financial highlights.
5	For additional information, please refer to Glossary of Terms.
6	Return for the period February 1, 2005 to October 31, 2013.

The Fund’s performance is primarily measured against the Barclays U.S. Aggregate Bond Index is an unmanaged index generally representative of investment-grade, USD-denominated, fixed-rate debt issues, taxable bond market, including Treasuries, government-related and corporate securities, asset-backed, mortgage-backed and commercial mortgage-backed securities, with maturities of at least one year. The performance of the index does not reflect the deduction of expenses associated with a mutual fund, such as investment management and fund accounting fees. The Fund’s performance reflects the deduction of fees for these value-added services. Investors cannot invest directly in an index.

HSBC FAMILY OF FUNDS       11

Portfolio Reviews (Unaudited)

Conservative Strategy Fund
(Class A Shares, Class B Shares and Class C Shares)

by Randeep Brar, CFA, Senior Vice President/Portfolio Manager
Caroline Hitch, Senior Portfolio Manager

The Conservative Strategy Fund (the “Fund”) is a “fund of funds” which seeks long-term growth of capital by investing primarily in underlying funds. The underlying funds may include mutual funds managed by HSBC Global Asset Management (USA) Inc. (the “Adviser”), mutual funds managed by investment advisers that are not associated with the Adviser and exchange traded funds (“ETFs”) (collectively, “Underlying Funds”). The Fund may also purchase or hold exchange traded notes (“ETNs”).

Investment Concerns

Allocation Risk: The risk that the Adviser’s target asset and sector allocations and changes in target asset and sector allocations cause the Fund to underperform other similar funds or cause you to lose money, and that the Fund may not achieve its target asset and sector allocations.

Underlying Fund Selection Risk: The risk that the Fund may invest in Underlying Funds that underperform other similar funds or the markets more generally, due to poor investment decisions by the investment adviser(s) for the Underlying Funds or otherwise. Underlying Funds also have their own expenses, which the Fund bears in addition to its own expenses.

Equity Securities Risk: A portion of the assets of the Fund is allocated to Underlying Funds investing primarily in equity securities. Therefore, the value of the Fund may increase or decrease as a result of its indirect interest in equity securities.

Fixed Income Securities Risk: A portion of the assets of the Fund is allocated to Underlying Funds investing primarily in fixed income securities. Therefore, the value of the Fund may increase or decrease as a result of its indirect interest in fixed income securities.

Foreign Securities/Emerging Markets Risk: Foreign securities, including those of emerging market issuers, are subject to additional risks including international trade, currency, political, and regulatory risks. Securities of emerging market issuers generally have more risk than securities issued by issuers in more developed foreign markets. For a complete description of these and other risks associated with investment in a mutual fund, please refer to the Fund’s prospectus.

Market Commentary

The Fund returned 6.28% (without sales charge) for the Class A Shares for the year ended October 31, 2013. That compared to a -1.08% total return for the Fund’s primary benchmark, the Barclays U.S. Aggregate Bond Index¹.

The Fund measures performance against several additional reference indices for the year ended October 31, 2013: the S&P 500 Index¹ (27.18% total return), MSCI EAFE Index¹ (27.40% total return), Bank of America/Merrill Lynch U.S. High Yield Master II Index¹ (8.83% total return) and Citigroup U.S. Domestic 3-Month Treasury Bill Index¹ (0.06% total return).

Portfolio Performance

Economic activity across the developed world gained momentum during the 12 months through October 31, 2013. Accommodative monetary policies in the U.S., Europe and Japan helped fuel modest economic growth, and investors’ appetites for riskier asset classes such as equities grew during the period.

However, global financial markets closely watched U.S. policy developments during the period. In particular, the U.S. Federal Reserve (the “Fed”) signaled midway through the period that it may begin tapering its ongoing stimulus efforts, including its large-scale purchases of assets such as Treasury bonds. That led to considerable volatility in the global financial markets. However, market sentiment surged later in the period when the Fed announced it would keep its stimulus efforts intact.

In Europe, considerable progress was made in bringing the eurozone debt crisis under control. In the second quarter of 2013, the eurozone economy grew by an estimated 0.3%, ending a period of six consecutive quarters of recession. Additionally, Japanese equities performed extremely well during the period thanks in large part to government stimulus efforts in that country.

Emerging markets lagged their developed market peers during the period. Such markets were very sensitive to Fed policy and the prospect of declining global liquidity if accommodative monetary policies were tightened. What’s more, a number of prominent emerging economies also had to contend with growth and inflation concerns. For instance, economic activity in China—the world’s largest emerging economy—showed signs of softening before posting strong growth late in the period.

In this environment, the Fund was positioned with a modest overweight in developed market equities. We believed developed market equities offered appealing valuations, particularly compared to developed market government bonds, which were trading at historically low yields. The Fund’s allocation to domestic equities was the primary driver of returns during the period. The Fund benefited from its neutral weighting to emerging markets equities, as such stocks considerably underperformed their developed market peers during the period.^†

The Fund began the period with an underweight position in U.S. aggregate bonds, and its exposure to these bonds was reduced several times during the period as Treasury yields remained at historical lows. That strategy added value to the Fund’s overall performance. The Fund benefited from its overweight positions in U.S. investment-grade and high-yield credit, and its exposure to both hard and local currency emerging markets debt.^†

There was very little change to the portfolio’s exposure to alternative investments during the period. The Fund benefited from an underweight position in commodities, which performed very poorly. An overweight position in property benefited the Fund, as did the portfolio’s private equity allocation, which performed very well during the period.^†

†	Portfolio composition is subject to change.
1	For additional information, please refer to the Glossary of Terms.

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

12       HSBC FAMILY OF FUNDS

Portfolio Reviews (Unaudited)

Conservative Strategy Fund

The charts above represent a historical since inception performance comparison of a hypothetical $10,000 investment in the indicated share class versus a similar investment in the Fund’s benchmark and represents the reinvestment of dividends and capital gains in the Fund.

		Average Annual				Expense
Fund Performance		Total Return (%)				Ratio (%)4
	Inception	1	5	Since
As of October 31, 2013	Date	Year	Year	Inception		Gross	Net
Conservative Strategy Fund Class A1	2/23/05	1.00	7.87	4.22		1.97	1.97
Conservative Strategy Fund Class B2	2/17/05	1.50	8.17	4.25		2.72	2.72
Conservative Strategy Fund Class C3	4/19/05	4.53	8.18	4.73		2.72	2.72
Barclays U.S. Aggregate Bond Index5	—	-1.08	6.09	4.76	6	N/A	N/A
S&P 500 Index5	—	27.18	15.17	6.68	6	N/A	N/A
MSCI EAFE Index5	—	27.40	12.52	5.83	6	N/A	N/A
BofA Merrill Lynch U.S. High Yield Master II Index5	—	8.83	18.03	8.22	6	N/A	N/A
Citigroup U.S. Domestic 3-Month Treasury Bill Index5	—	0.06	0.12	1.66	6	N/A	N/A

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect the taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower.

Certain returns shown include monies received by aeries of HSBC Portfolios (the “Portfolios”), in which the Fund invests, in respect of one-time class action settlements. As a result, the Fund’s total returns for those periods were higher than they would have been had the Portfolios not received the payments.

1	Reflects the maximum sales charge of 5.00%.
2	Reflects the applicable contingent deferred sales charge, maximum of 4.00%.
3	Reflects the applicable contingent deferred sales charge, maximum of 1.00%.
4	Reflects the expense ratios as reported in the prospectus dated February 28, 2013. The expense ratios reflected include Acquired Fund fees and expenses. Additional information pertaining to the October 31, 2013 expense ratios can be found in the financial highlights.
5	For additional information, please refer to the Glossary of Terms.
6	Return for the period February 17, 2005 to October 31, 2013.

The Fund’s performance is primarily measured against the Barclays U.S. Aggregate Bond Index is an unmanaged index generally representative of investment-grade, USD-denominated, fixed-rate debt issues, taxable bond market, including Treasuries, government-related and corporate securities, asset-backed, mortgage-backed and commercial mortgage-backed securities, with maturities of at least one year. The performance of the index does not reflect the deduction of expenses associated with a mutual fund, such as investment management and fund accounting fees. The Fund’s performance reflects the deduction of fees for these value-added services. Investors cannot invest directly in an index.

HSBC FAMILY OF FUNDS       13

Portfolio Reviews (Unaudited)

Income Strategy Fund
(Class A Shares, Class B Shares and Class C Shares)

Randeep Brar, CFA, Senior Vice President/Portfolio Manager
Caroline Hitch, Senior Portfolio Manager

The Income Strategy Fund (the “Fund”) is a “fund of funds” which primarily seeks current income and secondarily seeks to provide long-term growth of capital by investing primarily in underlying funds. The underlying funds may include mutual funds managed by HSBC Global Asset Management (USA) Inc. (the “Adviser”), mutual funds managed by investment advisers that are not associated with the Adviser and exchange traded funds (“ETFs”) (collectively, “Underlying Funds”). The Fund may also purchase or hold exchange traded notes (“ETNs”).

Investment Concerns

Allocation Risk: The risk that the Adviser’s target asset and sector allocations and changes in target asset and sector allocations cause the Fund to underperform other similar funds or cause you to lose money, and that the Fund may not achieve its target asset and sector allocations.

Underlying Fund Selection Risk: The risk that the Fund may invest in Underlying Funds that underperform other similar funds or the markets more generally, due to poor investment decisions by the investment adviser(s) for the Underlying Funds or otherwise. Underlying Funds also have their own expenses, which the Fund bears in addition to its own expenses.

Equity Securities Risk: A portion of the assets of the Fund is allocated to Underlying Funds investing primarily in equity securities. Therefore, the value of the Fund may increase or decrease as a result of its indirect interest in equity securities.

Fixed Income Securities Risk: A portion of the assets of the Fund is allocated to Underlying Funds investing primarily in fixed income securities. Therefore, the value of the Fund may increase or decrease as a result of its indirect interest in fixed income securities.

Foreign Securities/Emerging Markets Risk: Foreign securities, including those of emerging market issuers, are subject to additional risks including international trade, currency, political, and regulatory risks. Securities of emerging market issuers generally have more risk than securities issued by issuers in more developed foreign markets.

The net asset value per share of this Fund will fluctuate as the value of the securities in the portfolio changes.

For a complete description of these and other risks associated with investment in a mutual fund, please refer to the Fund’s prospectus.

Market Commentary

The Fund returned 2.57% (without sales charge) for the Class A Shares for the year ended October 31, 2013. That compared to a -1.08% total return for the Fund’s primary benchmark, Barclays U.S. Aggregate Bond Index¹, for the same period.

The Fund measures performance against several additional reference indices for the year ended October 31, 2013: the S&P 500 Index¹ (27.18% total return), MSCI EAFE Index¹ (27.40% total return), Bank of America/Merrill Lynch U.S. High Yield Master II Index¹ (8.83% total return) and Citigroup U.S. Domestic 3-Month Treasury Bill Index¹ (0.06% total return).

Portfolio Performance

Economic activity across the developed world gained momentum during the 12 months through October 31, 2013. Accommodative monetary policies in the U.S., Europe and Japan helped fuel modest economic growth, and investors’ appetites for riskier asset classes such as equities grew during the period.

However, global financial markets closely watched U.S. policy developments during the period. In particular, the U.S. Federal Reserve (the “Fed”) signaled midway through the period that it may begin tapering its ongoing stimulus efforts, including its large-scale purchases of assets such as Treasury bonds. That led to considerable volatility in the global financial markets. However, market sentiment surged later in the period when the Fed announced it would keep its stimulus efforts intact.

In Europe, considerable progress was made in bringing the eurozone debt crisis under control. In the second quarter of 2013, the eurozone economy grew by an estimated 0.3%, ending a period of six consecutive quarters of recession. Additionally, Japanese equities performed extremely well during the period thanks in large part to government stimulus efforts in that country.

Emerging markets lagged their developed market peers during the period. Such markets were very sensitive to Fed policy and the prospect of declining global liquidity if accommodative monetary policies were tightened. What’s more, a number of prominent emerging economies also had to contend with growth and inflation concerns. For instance, economic activity in China—the world’s largest emerging economy—showed signs of softening before posting strong growth late in the period.

In this environment, the Fund was positioned with a modest overweight in developed market equities. We believed developed market equities offered appealing valuations, particularly compared to developed market government bonds, which were trading at historically low yields. The Fund’s allocation to domestic equities was the primary driver of returns during the period. The Fund benefited from its neutral weighting to emerging markets equities, as such stocks considerably underperformed their developed market peers during the period.^†

The Fund began the period with an underweight position in U.S. aggregate bonds, and its exposure to these bonds was reduced several times during the period as Treasury yields remained at historical lows. That strategy added value to the Fund’s overall performance. The Fund benefited from its overweight positions in U.S. investment grade and high-yield credit, and its exposure to both hard and local currency emerging markets debt.^†

†	Portfolio composition is subject to change.
1	For additional information, please refer to the Glossary of Terms.

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

14       HSBC FAMILY OF FUNDS

Portfolio Reviews (Unaudited)

Income Strategy Fund

The charts above represent a historical since inception performance comparison of a hypothetical $10,000 investment in the indicated share class versus a similar investment in the Fund’s benchmark and represents the reinvestment of dividends and capital gains in the Fund.

		Average Annual				Expense
Fund Performance		Total Return (%)				Ratio (%)4
	Inception	1		Since
As of October 31, 2013	Date	Year		Inception		Gross	Net
Income Strategy Fund Class A1	3/20/12		-2.30	1.59		26.49	1.90
Income Strategy Fund Class B2	3/20/12		-2.16	2.09		27.24	2.65
Income Strategy Fund Class C3	3/20/12		0.76	3.84		27.24	2.65
Barclays U.S. Aggregate Bond Index5	—		-1.08	2.08	6	N/A	N/A
S&P 500 Index5	—		27.18	17.32	6	N/A	N/A
MSCI EAFE Index5	—		27.40	16.03	6	N/A	N/A
BofA Merrill Lynch U.S. High Yield Master II Index5	—		8.83	10.19	6	N/A	N/A
Citigroup U.S. Domestic 3-Month Treasury Bill Index5	—		0.06	0.07	6	N/A	N/A

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect the taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower. Currently, contractual fee waivers are in effect for the Fund through March 1, 2014.

1	Reflects the maximum sales charge of 4.75%.
2	Reflects the applicable contingent deferred sales charge, maximum of 4.00%.
3	Reflects the applicable contingent deferred sales charge, maximum of 1.00%.
4	Reflects the expense ratios as reported in the prospectus dated February 28, 2013. HSBC Global Asset Management (USA) Inc. has entered into a contractual expense limitation agreement with the Fund under which it will limit total expenses of the Fund (excluding interest, taxes, brokerage commissions, extraordinary expenses and estimated indirect expenses attributable to the Fund’s investments in investment companies other then the HSBC Growth Portfolio and HSBC Opportunity Portfolio) to an annual rate of 1.50%, 2.25% and 2.25% for Class A Shares, Class B Shares and Class C Shares, respectively. The expense limitation shall be in effect until March 1, 2014. The expense ratios reflected include Acquired Fund fees and expenses. Additional information pertaining to the October 31, 2013 expense ratios can be found in the financial highlights.
5	For additional information, please refer to the Glossary of Terms.
6	Return for the period March 21, 2012 to October 31, 2013.

The Fund’s performance is primarily measured against the Barclays U.S. Aggregate Bond Index is an unmanaged index generally representative of investment-grade, USD-denominated, fixed-rate debt issues, taxable bond market, including Treasuries, government-related and corporate securities, asset-backed, mortgage-backed and commercial mortgage-backed securities, with maturities of at least one year. The performance of the index does not reflect the deduction of expenses associated with a mutual fund, such as investment management and fund accounting fees. The Fund’s performance reflects the deduction of fees for these value-added services. Investors cannot invest directly in an index.

HSBC FAMILY OF FUNDS       15

Portfolio Reviews

Portfolio Composition*
October 31, 2013 (Unaudited)

Aggressive Strategy Fund
	Percentage of
Investment Allocation	Investments at Value(%)
Domestic Equities	57.8
International Equities	30.6
Fixed Income	6.8
Alternatives	4.6
Cash	0.2
Total	100.0
Balanced Strategy Fund
	Percentage of
Investment Allocation	Investments at Value(%)
Domestic Equities	41.4
International Equities	33.2
Fixed Income	18.5
Alternatives	6.5
Cash	0.4
Total	100.0
Moderate Strategy Fund
	Percentage of
Investment Allocation	Investments at Value(%)
Fixed Income	33.0
Domestic Equities	28.1
International Equities	27.9
Alternatives	10.2
Cash	0.8
Total	100.0
Conservative Strategy Fund
	Percentage of
Investment Allocation	Investments at Value(%)
Fixed Income	49.9
Domestic Equities	17.6
International Equities	26.0
Alternatives	5.2
Cash	1.3
Total	100.0
Income Strategy Fund
	Percentage of
Investment Allocation	Investments at Value(%)
Fixed Income	67.4
International Equities	22.4
Domestic Equities	8.9
Cash	1.3
Total	100.0

HSBC Growth Portfolio
	Percentage of
Investment Allocation	Investments at Value (%)
Internet Software & Services		9.4
Biotechnology		9.1
Internet & Catalog Retail		6.8
IT Services		6.4
Specialty Retail		5.9
Media		5.0
Chemicals		4.1
Oil, Gas & Consumable Fuels		4.1
Road & Rail		4.1
Hotels, Restaurants & Leisure		3.8
Capital Markets		3.7
Software		3.4
Aerospace & Defense		3.2
Textiles, Apparel & Luxury Goods		3.2
Computers & Peripherals		3.1
Semiconductors & Semiconductor
Equipment		3.1
Machinery		2.7
Food & Staples Retailing		2.4
Pharmaceuticals		2.1
Health Care Technology		1.7
Communications Equipment		1.5
Real Estate Investment Trusts (REITs)		1.5
Energy Equipment & Services		1.5
Wireless Telecommunication Services		1.4
Diversified Financial Services		1.2
Auto Components		1.2
Personal Products		1.1
Trading Companies & Distributors		1.0
Health Care Providers & Services		0.9
Airlines		0.7
Investment Companies		0.7
		100.0

____________________

*       Portfolio composition is subject to change.

16       HSBC FAMILY OF FUNDS

	Portfolio Reviews
Portfolio Composition* (continued)
October 31, 2013 (Unaudited)

HSBC Opportunity Portfolio
	Percentage of
Investment Allocation	Investments at Value (%)
Specialty Retail	8.1
IT Services	6.8
Chemicals	6.2
Household Durables	5.5
Oil, Gas & Consumable Fuels	5.1
Biotechnology	5.0
Health Care Equipment & Supplies	3.7
Life Sciences Tools & Services	3.4
Trading Companies & Distributors	3.3
Software	3.2
Aerospace & Defense	3.1
Semiconductors & Semiconductor
Equipment	3.0
Investment Companies	2.9
Commercial Banks	2.8
Containers & Packaging	2.7
Pharmaceuticals	2.7
Electrical Equipment	2.7
Internet Software & Services	2.6
Machinery	2.1
Professional Services	2.1
Insurance	2.0
Energy Equipment & Services	1.9
Health Care Providers & Services	1.9
Hotels, Restaurants & Leisure	1.9
Media	1.6
Commercial Services & Supplies	1.6
Capital Markets	1.6
Diversified Consumer Services	1.5
Auto Components	1.5
Road & Rail	1.3
Distributors	1.1
Real Estate Investment Trusts (REITs)	1.1
Real Estate Management &
Development	1.1
Health Care Technology	0.8
Construction Materials	0.8
Communications Equipment	0.7
Electronic Equipment,
Instruments & Components	0.6
	100.0

____________________

* Portfolio composition is subject to change.

HSBC FAMILY OF FUNDS       17

HSBC AGGRESSIVE STRATEGY FUND

Schedule of Portfolio Investments—as of October 31, 2013

Affiliated Investment Companies—1.4%
	Shares	Value ($)
HSBC Emerging Markets Debt Fund,
Class I Shares	21,418	223,608
HSBC Prime Money Market Fund,
Class I Shares, 0.03%(a)	42,491	42,491
TOTAL AFFILIATED INVESTMENT
COMPANIES (COST $259,917)		266,099
Affiliated Portfolios���11.5%
HSBC Growth Portfolio		1,364,526
HSBC Opportunity Portfolio		749,215
TOTAL AFFILIATED PORTFOLIOS		2,113,741
Unaffiliated Investment Companies—41.9%
Artisan Value Fund, Investor Shares	66,389	916,172
Brookfield Global Listed Real Estate
Fund, Institutional Shares	9,665	123,319
Brown Advisory Growth Equity Fund,
Institutional Shares	50,513	911,751
Columbia High Yield Bond Fund,
Class Z Shares	209,553	626,565
CRM Small/Mid Cap Value Fund,
Institutional Shares	39,042	746,490
Delaware Emerging Markets Fund,
Institutional Shares	60,380	995,667
JPMorgan Equity Income Fund,
Select Shares	108,831	1,383,248
JPMorgan High Yield Fund,
Select Shares	76,718	630,621
Principal Global Real Estate Securities
Fund, Institutional Shares	13,779	121,115
Trilogy Emerging Markets Equity Fund,
Institutional Shares	140,404	1,234,152
TOTAL UNAFFILIATED INVESTMENT
COMPANIES (COST $6,770,550)		7,689,100
Exchange Traded Funds—45.6%
iShares MSCI EAFE Index Fund	41,029	2,702,990
iShares MSCI Emerging Markets
Index Fund	5,673	240,876
PowerShares Global Listed Private
Equity Portfolio ETF	70,068	847,823
SPDR S&P 500 ETF Trust	26,103	4,587,080
TOTAL EXCHANGE TRADED
FUNDS (COST $7,103,708)		8,378,769
TOTAL INVESTMENT
SECURITIES—100.4%		18,447,709

____________________

Percentages indicated are based on net assets of $18,382,635.
(a)	The rate represents the annualized one-day yield that was in effect on October 31, 2013.

ETF	Exchange Traded Fund
SPDR	Standard & Poor’s Depositary Receipt

18        HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC BALANCED STRATEGY FUND

Schedule of Portfolio Investments—as of October 31, 2013

Affiliated Investment Companies—10.3%
	Shares	Value ($)
HSBC Emerging Markets Debt Fund,
Class I Shares	333,017	3,476,695
HSBC Emerging Markets Local Debt
Fund, Class I Shares	160,626	1,471,336
HSBC Prime Money Market Fund,
Class I Shares, 0.03%(a)	188,332	188,332
TOTAL AFFILIATED INVESTMENT
COMPANIES (COST $5,236,386)		5,136,363
Affiliated Portfolios—8.3%
HSBC Growth Portfolio		2,677,899
HSBC Opportunity Portfolio		1,470,039
TOTAL AFFILIATED PORTFOLIOS		4,147,938
Unaffiliated Investment Companies—45.7%
Artisan Value Fund, Investor Shares	128,817	1,777,679
Brookfield Global Listed Real Estate
Fund, Institutional Shares	78,112	996,707
Brown Advisory Growth Equity Fund,
Institutional Shares	98,963	1,786,290
Columbia High Yield Bond Fund,
Class Z Shares	1,111,635	3,323,789
CRM Small/Mid Cap Value Fund,
Institutional Shares	76,575	1,464,116
Delaware Emerging Markets Fund,
Institutional Shares	81,451	1,343,133
Janus Flexible Bond Fund,
Institutional Shares	28,013	296,378
JPMorgan Equity Income Fund,
Select Shares	210,589	2,676,581
JPMorgan High Yield Fund,
Select Shares	404,216	3,322,657
Lord Abbett Core Fixed Income Fund,
Institutional Shares	38,232	414,050
Metropolitan West Total Return Bond,
Institutional Shares	27,723	296,909
PIMCO Commodity RealReturn
Strategy Fund, Institutional Shares	271,531	1,534,151
PIMCO Total Return Fund,
Institutional Shares	50,106	546,153
Principal Global Real Estate Securities
Fund, Institutional Shares	111,739	982,188
T. Rowe Price New Income Fund,
Retail Shares	43,686	414,147
Trilogy Emerging Markets Equity Fund,
Institutional Shares	188,611	1,657,888
TOTAL UNAFFILIATED INVESTMENT
COMPANIES (COST $21,665,513)		22,832,816
Exchange Traded Funds—35.9%
iShares iBoxx $ Investment Grade
Corporate Bond Fund	5,443	627,034
iShares MSCI EAFE Index Fund	93,336	6,148,976
iShares MSCI Emerging Markets
Index Fund	12,425	527,565
PowerShares Global Listed Private
Equity Portfolio ETF	140,393	1,698,755
SPDR S&P 500 ETF Trust	50,648	8,900,373
TOTAL EXCHANGE TRADED
FUNDS (COST $15,308,567)		17,902,703
TOTAL INVESTMENT
SECURITIES—100.2%		50,019,820

____________________

Percentages indicated are based on net assets of $49,922,713.
(a)	The rate represents the annualized one-day yield that was in effect on October 31, 2013.

ETF	Exchange Traded Fund
SPDR	Standard & Poor’s Depositary Receipt

See notes to financial statements. HSBC FAMILY OF FUNDS        19

HSBC MODERATE STRATEGY FUND

Schedule of Portfolio Investments—as of October 31, 2013

Affiliated Investment Companies—12.2%
	Shares	Value ($)
HSBC Emerging Markets Debt Fund,
Class I Shares	310,161	3,238,081
HSBC Emerging Markets Local Debt
Fund, Class I Shares	193,511	1,772,558
HSBC Prime Money Market Fund,
Class I Shares, 0.03%(a)	357,947	357,947
TOTAL AFFILIATED INVESTMENT
COMPANIES (COST $5,403,702)		5,368,586
Affiliated Portfolios—5.6%
HSBC Growth Portfolio		1,598,762
HSBC Opportunity Portfolio		884,337
TOTAL AFFILIATED PORTFOLIOS		2,483,099
Unaffiliated Investment Companies—55.2%
Artisan Value Fund, Investor Shares	77,493	1,069,409
ASG Global Alternatives Fund,
Class Y Shares	30,090	350,248
Brookfield Global Listed Real Estate
Fund, Institutional Shares	66,485	848,349
Brown Advisory Growth Equity Fund,
Institutional Shares	59,536	1,074,617
Columbia High Yield Bond Fund,
Class Z Shares	972,907	2,908,992
CRM Small/Mid Cap Value Fund,
Institutional Shares	45,515	870,241
Delaware Emerging Markets Fund,
Institutional Shares	53,234	877,827
Janus Flexible Bond Fund,
Institutional Shares	116,842	1,236,188
JPMorgan Equity Income Fund,
Select Shares	128,265	1,630,247
JPMorgan High Yield Fund,
Select Shares	354,871	2,917,043
Lord Abbett Core Fixed Income Fund,
Institutional Shares	163,938	1,775,444
Metropolitan West Total Return Bond,
Institutional Shares	115,632	1,238,422
PIMCO Commodity RealReturn
Strategy Fund, Institutional Shares	280,262	1,583,480
PIMCO Total Return Fund,
Institutional Shares	213,954	2,332,103
Principal Global Real Estate Securities
Fund, Institutional Shares	95,190	836,720
T. Rowe Price New Income Fund,
Retail Shares	185,347	1,757,090
Trilogy Emerging Markets Equity Fund,
Institutional Shares	123,258	1,083,438
TOTAL UNAFFILIATED INVESTMENT
COMPANIES (COST $23,948,828)		24,389,858
Exchange Traded Funds—27.2%
iShares iBoxx $ Investment Grade
Corporate Bond	3,834	441,677
iShares MSCI EAFE ETF	76,811	5,060,309
iShares MSCI Emerging Markets ETF	7,346	311,911
PowerShares Global Listed Private
Equity Portfolio ETF	74,219	898,050
SPDR S&P 500 ETF Trust	30,198	5,306,694
TOTAL EXCHANGE TRADED
FUNDS (COST $10,248,627)		12,018,641
TOTAL INVESTMENT
SECURITIES—100.2%		44,260,184

____________________

Percentages indicated are based on net assets of $44,186,098.
(a)	The rate represents the annualized one-day yield that was in effect on October 31, 2013.

ETF	Exchange Traded Fund
SPDR	Standard & Poor’s Depositary Receipt

20        HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC CONSERVATIVE STRATEGY FUND

Schedule of Portfolio Investments—as of October 31, 2013

Affiliated Investment Companies—12.6%
	Shares	Value ($)
HSBC Emerging Markets Debt Fund,
Class I Shares	142,821	1,491,047
HSBC Emerging Markets Local Debt
Fund, Class I Shares	108,300	992,027
HSBC Prime Money Market Fund,
Class I Shares, 0.03%(a)	284,508	284,508
TOTAL AFFILIATED INVESTMENT
COMPANIES (COST $2,792,418)		2,767,582
Affiliated Portfolios—3.5%
HSBC Growth Portfolio		502,224
HSBC Opportunity Portfolio		267,527
TOTAL AFFILIATED PORTFOLIOS		769,751
Unaffiliated Investment Companies—64.9%
Artisan Value Fund, Investor Shares	23,928	330,202
ASG Global Alternatives Fund,
Class Y Shares	37,092	431,746
Brookfield Global Listed Real Estate
Fund, Institutional Shares	33,145	422,931
Brown Advisory Growth Equity Fund,
Institutional Shares	18,385	331,857
Columbia High Yield Bond Fund,
Class Z Shares	450,392	1,346,672
CRM Small/Mid Cap Value Fund,
Institutional Shares	14,050	268,642
Delaware Emerging Markets Fund,
Institutional Shares	7,652	126,189
Janus Flexible Bond Fund,
Institutional Shares	112,563	1,190,912
JPMorgan Equity Income Fund,
Select Shares	39,583	503,095
JPMorgan High Yield Fund,
Select Shares	163,489	1,343,876
Lord Abbett Core Fixed Income Fund,
Institutional Shares	153,506	1,662,473
Metropolitan West Total Return Bond,
Institutional Shares	111,396	1,193,054
PIMCO Commodity RealReturn
Strategy Fund, Institutional Shares	113,598	641,831
PIMCO Total Return Fund,
Institutional Shares	204,624	2,230,406
Principal Global Real Estate Securities
Fund, Institutional Shares	47,403	416,672
T. Rowe Price New Income Fund,
Retail Shares	175,196	1,660,854
Trilogy Emerging Markets Equity Fund,
Institutional Shares	14,556	127,950
TOTAL UNAFFILIATED INVESTMENT
COMPANIES (COST $13,945,824)		14,229,362
Exchange Traded Funds—19.2%
iShares iBoxx $ Investment Grade
Corporate Bond	2,796	322,099
iShares MSCI EAFE ETF	32,330	2,129,901
PowerShares Global Listed Private
Equity Portfolio ETF	6,440	77,924
SPDR S&P 500 ETF Trust	9,500	1,669,435
TOTAL EXCHANGE TRADED
FUNDS (COST $3,572,550)		4,199,359
TOTAL INVESTMENT
SECURITIES—100.2%		21,966,054

____________________

Percentages indicated are based on net assets of $21,919,106.
(a)	The rate represents the annualized one-day yield that was in effect on October 31, 2013.

ETF	Exchange Traded Fund
SPDR	Standard & Poor’s Depositary Receipt

See notes to financial statements. HSBC FAMILY OF FUNDS        21

HSBC INCOME STRATEGY FUND

Schedule of Portfolio Investments—as of October 31, 2013

Affiliated Investment Companies—10.5%
	Shares	Value ($)
HSBC Emerging Markets Debt Fund,
Class I Shares	6,139	64,096
HSBC Emerging Markets Local Debt
Fund, Class I Shares	6,828	62,548
HSBC Prime Money Market Fund,
Class I Shares, 0.03%(a)	16,773	16,773
TOTAL AFFILIATED INVESTMENT
COMPANIES (COST $148,734)		143,417
Unaffiliated Investment Companies—86.5%
Brookfield Global Listed Real Estate
Fund, Institutional Shares	2,468	31,493
Columbia High Yield Bond Fund,
Class Z Shares	19,576	58,532
Eaton Vance Floating - Rate Fund,
Institutional Shares	5,794	53,135
Federated Strategic Value Dividend Fund,
Institutional Shares	10,189	59,099
Janus Flexible Bond Fund,
Institutional Shares	10,049	106,319
JPMorgan Equity Income Fund,
Select Shares	4,664	59,276
JPMorgan High Yield Fund,
Select Shares	7,122	58,545
Lord Abbett Core Fixed Income Fund,
Institutional Shares	13,858	150,078
Metropolitan West Total Return Bond,
Institutional Shares	9,981	106,894
PIMCO Total Return Fund,
Institutional Shares	18,238	198,795
Principal Global Real Estate Securities
Fund, Institutional Shares	3,556	31,255
T. Rowe Price International Growth &
Income Fund, Retail Shares	7,163	110,596
T. Rowe Price New Income Fund,
Retail Shares	15,732	149,140
TOTAL UNAFFILIATED INVESTMENT
COMPANIES (COST $1,169,208)		1,173,157
Exchange Traded Fund—1.5%
iShares iBoxx $ Investment Grade
Corporate Bond	174	20,045
TOTAL EXCHANGE TRADED
FUNDS (COST $20,633)		20,045
TOTAL INVESTMENT
SECURITIES—98.5%		1,336,619

____________________

Percentages indicated are based on net assets of $1,356,479.
(a)	The rate represents the annualized one-day yield that was in effect on October 31, 2013.

22        HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC WORLD SELECTION FUNDS

Statements of Assets and Liabilities—as of October 31, 2013

	Aggressive				Balanced				Moderate				Conservative				Income
	Strategy				Strategy				Strategy				Strategy				Strategy
	Fund				Fund				Fund				Fund				Fund
Assets:
Investments in Affiliated Portfolios		$	2,113,741			$	4,147,938			$	2,483,099			$	769,751			$	—
Investments in Affiliated Investment Companies, at value(a)			266,099				5,136,363				5,368,586				2,767,582				143,417
Investments in non-affiliates, at value			16,067,869				40,735,519				36,408,499				18,428,721				1,193,202
Total Investments			18,447,709				50,019,820				44,260,184				21,966,054				1,336,619
Cash			—				—				—				465				—
Interest and dividends receivable			—				34				—				—				2,922
Receivable for capital shares issued			13,193				38,401				13,227				10,575				100
Receivable for investments sold			—				261,410				178,105				—				10,478
Reclaims receivable			74				138				123				42				—
Receivable from Investment Adviser			—				—				—				—				26,290
Prepaid expenses and other assets			5,333				5,171				5,551				4,699				3,319
Total Assets			18,466,309				50,324,974				44,457,190				21,981,835				1,379,728
Liabilities:
Cash overdraft			—				230,861				177,940				—				—
Income payable			—				—				—				—				2
Payable for investments purchased			—				30,371				—				465				—
Payable for capital shares redeemed			41,103				55,945				11,741				10,315				120
Accrued expenses and other liabilities:
Investment Management			3,457				10,544				9,364				4,680				—
Administration			387				1,052				934				467				57
Distribution			4,708				13,746				12,859				8,250				793
Shareholder Servicing			3,427				8,771				8,280				3,978				495
Compliance Services			1				3				2				2				3
Accounting			220				219				219				219				219
Custodian			5,381				9,647				9,574				8,456				6,594
Transfer Agent			9,733				17,339				17,327				9,881				4,507
Trustee			17				44				38				21				18
Other			15,240				23,719				22,814				15,995				10,441
Total Liabilities			83,674				402,261				271,092				62,729				23,249
Net Assets		$	18,382,635			$	49,922,713			$	44,186,098			$	21,919,106			$	1,356,479
Composition of Net Assets:
Capital			14,333,194				41,329,930				39,312,430				20,242,637				1,336,953
Accumulated net investment income (loss)			19,297				421,721				71,162				46,289				(3	)
Accumulated net realized gains (losses) from investments			1,001,299				2,750,213				1,526,432				415,207				21,485
Unrealized appreciation/depreciation on investments			3,028,845				5,420,849				3,276,074				1,214,973				(1,956	)
Net Assets		$	18,382,635			$	49,922,713			$	44,186,098			$	21,919,106			$	1,356,479
Net Assets:
Class A Shares		$	11,105,731			$	28,745,711			$	24,670,870			$	9,254,692			$	311,218
Class B Shares			5,603,935				15,632,859				15,406,610				9,222,391				402,196
Class C Shares			1,672,969				5,544,143				4,108,618				3,442,023				643,065
		$	18,382,635			$	49,922,713			$	44,186,098			$	21,919,106			$	1,356,479
Shares Outstanding
($0.001 par value, unlimited number of shares authorized):
Class A Shares			712,980				1,997,706				1,914,814				775,674				30,044
Class B Shares			377,714				1,090,847				1,197,506				783,500				38,907
Class C Shares			113,197				386,330				328,589				284,092				62,224
Net Asset Value, Offering Price and Redemption
Price per share:
Class A Shares		$	15.58			$	14.39			$	12.88			$	11.93			$	10.36
Class B Shares(b)		$	14.84			$	14.33			$	12.87			$	11.77			$	10.34
Class C Shares(b)		$	14.78			$	14.35			$	12.50			$	12.12			$	10.33
Maximum Sales Charge—Class A Shares			5.00	%			5.00	%			5.00	%			5.00	%			4.75	%
Maximum Offering Price per share (Net Asset Value/
(100%-maximum sales charge))—Class A Shares		$	16.40			$	15.15			$	13.56			$	12.56			$	10.88
Investments in Affiliated Investment Companies, at cost(a)		$	259,917			$	5,236,386			$	5,403,702			$	2,792,418			$	148,734
Investments in non-affiliates, at cost		$	13,874,258			$	36,974,080			$	34,197,455			$	17,518,374			$	1,189,841

____________________

(a)	Investment in the affiliated investment companies include the HSBC Prime Money Market Fund, Class I Shares, HSBC Emerging Markets Debt Fund, Class I Shares and HSBC Emerging Markets Local Debt Fund, Class I Shares (See Note 1).
(b)	Redemption Price per share varies by length of time shares are held.

See notes to financial statements. HSBC WORLD SELECTION FUNDS        23

HSBC WORLD SELECTION FUNDS

Statements of Operations—For the year ender October 31, 2013

	Aggressive				Balanced				Moderate				Conservative				Income
	Strategy				Strategy				Strategy				Strategy				Strategy
	Fund				Fund				Fund				Fund				Fund
Investment Income:
Investment income from non-affiliated investments		$	390,177			$	1,196,694			$	1,106,166			$	573,954			$	32,548
Investment income from affiliated investments(a)			37,593				274,359				222,116				100,905				3,620
Tax reclaims from affiliated portfolios			24				52				46				13				—
Expenses from affiliated portfolios			(18,894	)			(39,296	)			(24,004	)			(7,494	)			—
Total Investment Income			408,900				1,404,809				1,304,324				667,378				36,168
Expenses:
Investment Management			45,246				127,157				112,877				56,024				2,846
Administration:
Class A Shares			2,684				7,194				6,201				2,431				164
Class B Shares			1,404				4,015				4,134				2,403				192
Class C Shares			414				1,442				896				740				211
Distribution:
Class B Shares			42,320				120,988				124,587				72,385				2,859
Class C Shares			12,468				43,374				26,927				22,238				3,147
Shareholder Servicing:
Class A Shares			26,746				71,443				61,785				24,222				704
Class B Shares			14,110				40,349				41,551				24,148				901
Class C Shares			4,159				14,482				8,995				7,437				1,049
Accounting			22,909				22,969				22,975				22,959				48,859
Audit			16,476				15,075				16,610				16,532				16,186
Compliance Services			107				391				340				145				12
Custodian			22,981				41,047				39,321				33,262				22,493
Printing			11,285				7,351				12,323				4,313				791
Transfer Agent			60,509				109,088				103,832				60,963				27,286
Trustee			463				1,311				1,164				576				45
Registration fees			18,408				16,722				18,718				13,974				32,343
Other			5,309				12,561				12,073				5,293				1,809
Total expenses before fee reductions			307,998				656,959				615,309				370,045				161,897
Fees contractually reduced/reimbursed by Investment Adviser			(421	)			—				—				—				(138,725	)
Net Expenses			307,577				656,959				615,309				370,045				23,172
Net Investment Income (Loss)			101,323				747,850				689,015				297,333				12,996
Net Realized/Unrealized Gains (Losses) from Investments:
Net realized gains (losses) from affiliated investment securities(a)			498,052				1,227,389				796,398				247,317				1,944
Net realized gains (losses) from non-affiliated investment securities			798,090				1,735,660				1,115,253				318,792				30,054
Net realized gains distributions from affiliated underlying funds			3,414				73,037				69,669				33,240				—
Net realized gains distributions from non-affiliated underlying funds			29,764				151,174				248,209				193,591				—
Change in unrealized appreciation/depreciation on affiliated investments(a)			184,853				(135,212	)			(282,921	)			(154,094	)			(8,116	)
Change in unrealized appreciation/depreciation on non-affiliated investments			1,980,851				3,498,648				1,852,183				336,892				(11,891	)
Net realized/unrealized gains (losses) from investments			3,495,024				6,550,696				3,798,791				975,738				11,991
Change In Net Assets Resulting From Operations		$	3,596,347			$	7,298,546			$	4,487,806			$	1,273,071			$	24,987

____________________

(a) Represents amounts allocated from Affiliated Investment Companies and Affiliated Portfolios.

24        HSBC WORLD SELECTION FUNDS See notes to financial statements.

HSBC WORLD SELECTION FUNDS

Statements of Changes in Net Assets

	Aggressive Strategy Fund								Balanced Strategy Fund
	For the				For the				For the				For the
	year ended				year ended				year ended				year ended
	October 31,				October 31,				October 31,				October 31,
	2013				2012				2013				2012
Investment Activities:
Operations:
Net investment income (loss)		$	101,323			$	(30,313	)		$	747,850			$	829,128
Net realized gains (losses) from investments			1,329,320				435,511				3,187,260				1,339,315
Change in unrealized appreciation/depreciation on investments			2,165,704				869,238				3,363,436				2,007,609
Change in net assets resulting from operations			3,596,347				1,274,436				7,298,546				4,176,052
Dividends:
Net investment income:
Class A Shares			(31,802	)			(77,670	)			(526,976	)			(912,343	)
Class B Shares			—				(8,596	)			(168,352	)			(454,511	)
Class C Shares			—				(6,139	)			(59,678	)			(174,260	)
Change in net assets resulting from shareholder dividends			(31,802	)			(92,405	)			(755,006	)			(1,541,114	)
Change in net assets resulting from capital transactions			(2,901,389	)			(1,313,685	)			(8,823,314	)			(3,920,082	)
Change in net assets			663,156				(131,654	)			(2,279,774	)			(1,285,144	)
Net Assets:
Beginning of period			17,719,479				17,851,133				52,202,487				53,487,631
End of period		$	18,382,635			$	17,719,479			$	49,922,713			$	52,202,487
Accumulated net investment income (loss)		$	19,297			$	(63,840	)		$	421,721			$	320,543

See notes to financial statements. HSBC WORLD SELECTION FUNDS       25

HSBC WORLD SELECTION FUNDS

Statements of Changes in Net Assets (continued)

	Aggressive Strategy Fund								Balanced Strategy Fund
	For the				For the				For the				For the
	year ended				year ended				year ended				year ended
	October 31,				October 31,				October 31,				October 31,
	2013				2012				2013				2012
CAPITAL TRANSACTIONS:
Class A Shares:
Proceeds from shares issued		$	1,119,903			$	2,113,457			$	3,539,929			$	5,462,023
Dividends reinvested			31,467				76,522				512,520				896,978
Value of shares redeemed			(2,321,459	)			(1,916,446	)			(8,512,370	)			(6,605,601	)
Class A Shares capital transactions			(1,170,089	)			273,533				(4,459,921	)			(246,600	)
Class B Shares:
Proceeds from shares issued			222,109				692,637				670,001				2,081,326
Dividends reinvested			—				8,454				166,080				449,537
Value of shares redeemed			(1,586,642	)			(2,003,556	)			(4,094,807	)			(5,369,321	)
Class B Shares capital transactions			(1,364,533	)			(1,302,465	)			(3,258,726	)			(2,838,458	)
Class C Shares:
Proceeds from shares issued			216,625				280,202				1,158,773				980,626
Dividends reinvested			—				6,111				58,220				170,621
Value of shares redeemed			(583,392	)			(571,066	)			(2,321,660	)			(1,986,271	)
Class C Shares capital transactions			(366,767	)			(284,753	)			(1,104,667	)			(835,024	)
Change in net assets resulting from capital transactions		$	(2,901,389	)		$	(1,313,685	)		$	(8,823,314	)		$	(3,920,082	)
SHARE TRANSACTIONS:
Class A Shares:
Issued			80,079				170,638				264,663				449,415
Reinvested			2,391				6,672				40,135				78,890
Redeemed			(163,112	)			(154,093	)			(636,383	)			(540,992	)
Change in Class A Shares			(80,642	)			23,217				(331,585	)			(12,687	)
Class B Shares:
Issued			16,573				58,381				50,599				170,500
Reinvested			—				765				12,975				39,468
Redeemed			(119,259	)			(168,348	)			(306,391	)			(442,138	)
Change in Class B Shares			(102,686	)			(109,202	)			(242,817	)			(232,170	)
Class C Shares:
Issued			15,890				23,588				86,274				80,512
Reinvested			—				556				4,545				14,967
Redeemed			(43,405	)			(48,318	)			(172,661	)			(160,924	)
Change in Class C Shares			(27,515	)			(24,174	)			(81,842	)			(65,445	)

26       HSBC WORLD SELECTION FUNDS See notes to financial statements.

HSBC WORLD SELECTION FUNDS

Statements of Changes in Net Assets (continued)

	Moderate Strategy Fund								Conservative Strategy Fund
	For the				For the				For the				For the
	year ended				year ended				year ended				year ended
	October 31,				October 31,				October 31,				October 31,
	2013				2012				2013				2012
Investment Activities:
Operations:
Net investment income (loss)		$	689,015			$	927,899			$	297,333			$	436,646
Net realized gains (losses) from investments			2,229,529				1,043,026				792,940				130,546
Change in unrealized appreciation/depreciation on investments			1,569,262				1,583,173				182,798				1,028,581
Change in net assets resulting from operations			4,487,806				3,554,098				1,273,071				1,595,773
Dividends:
Net investment income:
Class A Shares			(535,629	)			(657,742	)			(210,889	)			(283,394	)
Class B Shares			(246,797	)			(398,779	)			(148,678	)			(215,487	)
Class C Shares			(55,954	)			(78,368	)			(43,828	)			(57,748	)
Change in net assets resulting from shareholder dividends			(838,380	)			(1,134,889	)			(403,395	)			(556,629	)
Change in net assets resulting from capital transactions			(5,581,708	)			(4,201,200	)			(1,590,952	)			1,174,324
Change in net assets			(1,932,282	)			(1,781,991	)			(721,276	)			2,213,468
Net Assets:
Beginning of period			46,118,380				47,900,371				22,640,382				20,426,914
End of period		$	44,186,098			$	46,118,380			$	21,919,106			$	22,640,382
Accumulated net investment income (loss)		$	71,162			$	43,306			$	46,289			$	16,781

See notes to financial statements. HSBC WORLD SELECTION FUNDS       27

HSBC WORLD SELECTION FUNDS

Statements of Changes in Net Assets (continued)

	Moderate Strategy Fund								Conservative Strategy Fund
	For the				For the				For the				For the
	year ended				year ended				year ended				year ended
	October 31,				October 31,				October 31,				October 31,
	2013				2012				2013				2012
CAPITAL TRANSACTIONS:
Class A Shares:
Proceeds from shares issued		$	3,831,691			$	5,814,895			$	1,655,437			$	2,466,524
Dividends reinvested			523,791				648,574				198,276				267,600
Value of shares redeemed			(6,879,650	)			(6,285,101	)			(2,914,887	)			(2,212,701	)
Class A Shares capital transactions			(2,524,168	)			178,368				(1,061,174	)			521,423
Class B Shares:
Proceeds from shares issued			893,722				1,837,722				981,218				1,972,436
Dividends reinvested			241,511				392,486				142,306				204,146
Value of shares redeemed			(4,683,399	)			(5,898,444	)			(2,079,054	)			(1,807,237	)
Class B Shares capital transactions			(3,548,166	)			(3,668,236	)			(955,530	)			369,345
Class C Shares:
Proceeds from shares issued			1,491,199				682,092				1,262,554				1,056,887
Dividends reinvested			53,892				77,318				42,276				54,627
Value of shares redeemed			(1,054,465	)			(1,470,742	)			(879,078	)			(827,958	)
Class C Shares capital transactions			490,626				(711,332	)			425,752				283,556
Change in net assets resulting from capital transactions		$	(5,581,708	)		$	(4,201,200	)		$	(1,590,952	)		$	1,174,324
SHARE TRANSACTIONS:
Class A Shares:
Issued			309,439				505,703				141,736				223,077
Reinvested			42,928				58,105				17,175				24,607
Redeemed			(556,132	)			(546,616	)			(249,249	)			(198,821	)
Change in Class A Shares			(203,765	)			17,192				(90,338	)			48,863
Class B Shares:
Issued			72,673				160,345				85,320				180,184
Reinvested			19,864				35,603				12,485				19,128
Redeemed			(378,804	)			(514,301	)			(180,032	)			(164,720	)
Change in Class B Shares			(286,267	)			(318,353	)			(82,227	)			34,592
Class C Shares:
Issued			123,399				61,003				106,168				93,307
Reinvested			4,542				7,205				3,602				4,973
Redeemed			(87,560	)			(131,493	)			(74,185	)			(73,251	)
Change in Class C Shares			40,381				(63,285	)			35,585				25,029

28       HSBC WORLD SELECTION FUNDS See notes to financial statements.

HSBC WORLD SELECTION FUNDS

Statements of Changes in Net Assets (continued)

	Income Strategy Fund
	For the				For the
	year ended				period ended
	October 31,				October 31,
	2013				2012(a)
Investment Activities:
Operations:
Net investment income (loss)		$	12,996			$	3,609
Net realized gains (losses) from investments			31,998				2,837
Change in unrealized appreciation/depreciation from investments			(20,007	)			18,051
Change in net assets resulting from operations			24,987				24,497
Dividends:
Net investment income:
Class A Shares			(9,746	)			(1,852	)
Class B Shares			(8,155	)			(687	)
Class C Shares			(6,165	)			(536	)
Net realized gains:
Class A Shares			(1,059	)			—
Class B Shares			(1,181	)			—
Class C Shares			(842	)			—
Change in net assets resulting from shareholder dividends			(27,148	)			(3,075	)
Change in net assets resulting from capital transactions			441,756				895,462
Change in net assets			439,595				916,884
Net Assets:
Beginning of period			916,884				—
End of period		$	1,356,479			$	916,884
Accumulated net investment income (loss)		$	(3	)		$	7,921

____________________
(a) Commenced operations on March 20, 2012.

See notes to financial statements. HSBC WORLD SELECTION FUNDS       29

HSBC WORLD SELECTION FUNDS

Statements of Changes in Net Assets (continued)

	Income Strategy Fund
	For the				For the
	year ended				period ended
	October 31,				October 31,
	2013				2012(a)
CAPITAL TRANSACTIONS:
Class A Shares:
Proceeds from shares issued		$	104,917			$	429,058
Dividends reinvested			10,780				1,851
Value of shares redeemed			(141,000	)			(103,668	)
Class A Shares capital transactions			(25,303	)			327,241
Class B Shares:
Proceeds from shares issued			65,346				349,020
Dividends reinvested			8,530				644
Value of shares redeemed			(17,586	)			(7,223	)
Class B Shares capital transactions			56,290				342,441
Class C Shares:
Proceeds from shares issued			505,835				226,393
Dividends reinvested			6,873				536
Value of shares redeemed			(101,939	)			(1,149	)
Class C Shares capital transactions			410,769				225,780
Change in net assets resulting from capital transactions		$	441,756			$	895,462
SHARE TRANSACTIONS:
Class A Shares:
Issued			10,151				42,276
Reinvested			1,048				179
Redeemed			(13,472	)			(10,138	)
Change in Class A Shares			(2,273	)			32,317
Class B Shares:
Issued			6,335				34,074
Reinvested			830				62
Redeemed			(1,693	)			(701	)
Change in Class B Shares			5,472				33,435
Class C Shares:
Issued			49,258				22,294
Reinvested			670				52
Redeemed			(9,936	)			(114	)
Change in Class C Shares			39,992				22,232

____________________
(a) Commenced operations on March 20, 2012.

30       HSBC WORLD SELECTION FUNDS See notes to financial statements.

AGGRESSIVE STRATEGY FUND

FinancialHighlights

Selected data for a share outstandingthroughout the periodsindicated.*

				InvestmentActivities									Dividends												Ratios/Supplemental Data
	Net Asset Value, Beginning of Period			Net Investment Income (Loss)(a)			Net Realized and Unrealized Gains (Losses) from Investments			Total from Investment Activities			Net Investment Income			Total Dividends			Net Asset Value, End of Period			Total Return(b)			Net Assets at End of Period (000’s)			Ratio of Net Expenses to Average Net Assets	Ratio of Net Investment Income (Loss) to Average Net Assets			Ratios of Expenses to Average Net Assets (Excluding Fee Reductions)	Portfolio Turnover (c)
CLASS A SHARES
Year Ended October 31, 2009		$	8.62		0.01			1.57			1.58			—			—			$	10.20		18.33	%(d)		$	5,426	1.50%		0.09	%	2.16%	53%
Year Ended October 31, 2010			10.20		0.03			1.80			1.83			—			—				12.03		17.94	%(e)			7,886	1.50%		0.24	%	2.00%	50%
Year Ended October 31, 2011			12.03		0.10			(0.07	)		0.03			(0.10	)		(0.10	)			11.96		0.20	%(f)			9,217	1.50%		0.77	%	1.61%	71%
Year Ended October 31, 2012			11.96		0.02			0.89			0.91			(0.10	)		(0.10	)			12.77		7.72	%			10,136	1.50%		0.16	%	1.66%	71%
Year Ended October 31, 2013			12.77		0.12			2.73			2.85			(0.04	)		(0.04	)			15.58		22.38	%			11,106	1.50%		0.86	%	1.50%	37%
CLASS B SHARES
Year Ended October 31, 2009		$	8.39		(0.06	)		1.53			1.47			—			—			$	9.86		17.52	%(d)		$	3,767	2.25%		(0.66	)%	2.91%	53%
Year Ended October 31, 2010			9.86		(0.05	)		1.73			1.68			—			—				11.54		17.04	%(e)			5,519	2.25%		(0.51	)%	2.75%	50%
Year Ended October 31, 2011			11.54		—	(h)		(0.06	)		(0.06	)		(0.03	)		(0.03	)			11.45		(0.53	)%(f)			6,750	2.25%		0.02	%	2.36%	71%
Year Ended October 31, 2012			11.45		(0.07	)		0.85			0.78			(0.01	)		(0.01	)			12.22		6.87	%			5,870	2.25%		(0.57	)%	2.40%	71%
Year Ended October 31, 2013			12.22		0.01			2.61			2.62			—			—				14.84		21.44	%(g)			5,604	2.25%		0.11	%	2.25%	37%
CLASS C SHARES
Year Ended October 31, 2009		$	8.39		(0.05	)		1.51			1.46			—			—			$	9.85		17.40	%(d)		$	289	2.25%		(0.59	)%	2.93%	53%
Year Ended October 31, 2010			9.85		(0.05	)		1.73			1.68			—			—				11.53		17.06	%(e)			698	2.25%		(0.47	)%	2.76%	50%
Year Ended October 31, 2011			11.53		—	(h)		(0.05	)		(0.05	)		(0.05	)		(0.05	)			11.43		(0.46	)%(f)			1,884	2.25%		—	%(i)	2.35%	71%
Year Ended October 31, 2012			11.43		(0.07	)		0.85			0.78			(0.04	)		(0.04	)			12.17		6.83	%			1,713	2.25%		(0.56	)%	2.40%	71%
Year Ended October 31, 2013			12.17		0.02			2.59			2.61			—			—				14.78		21.45	%(g)			1,673	2.25%		0.12	%	2.25%	37%

*	The per share amounts and percentages reflect income and expenses assuming inclusion of the Fund’s proportionate share of the income and expenses of the applicable HSBC Portfolios, the Fund does not include expenses of the affiliated and unaffiliated investment companies, in which the Fund invests.
(a)	Calculated based on average shares outstanding.
(b)	Total return calculations do not include any sales or redemption charges.
(c)	Portfolio turnover rate is calculated by aggregating the results of multiplying the Fund’s investment percentage in the respective Portfolios, affiliated and unaffiliated investment companies by their corresponding portfolio turnover rates. Portfolio turnover rate is calculated on the basis of the Fund as a whole without distinguishing between classes of shares issued.
(d)	During the year ended October 31, 2009, certain HSBC Portfolios, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.11%, 0.11% and 0.11% for Class A Shares, Class B Shares and Class C Shares, respectively.
(e)	During the year ended October 31, 2010, certain HSBC Portfolios, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.09%, 0.09% and 0.09% for Class A Shares, Class B Shares and Class C Shares, respectively.
(f)	During the year ended October 31, 2011, certain HSBC Portfolios, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.08%, 0.08% and 0.08% for Class A Shares, Class B Shares and Class C Shares, respectively.
(g)	Rounds to less than $0.01 or $(0.01).
(h)	Rounds to less than 0.005% or (0.005)%.

See notes to financial statements. HSBC WORLD SELECTION FUNDS       31

BALANCED STRATEGY FUND

FinancialHighlights

Selected data for a share outstandingthroughout the periodsindicated.*

				InvestmentActivities					Dividends								Ratios/Supplemental Data
	Net Asset Value, Beginning of Period			Net Investment Income (Loss)(a)	Net Realized and Unrealized Gains (Losses) from Investments			Total from Investment Activities	Net Investment Income	Total Dividends	Net Asset Value, End of Period			Total Return(b)			Net Assets at End of Period (000’s)			Ratio of Net Expenses to Average Net Assets	Ratio of Net Investment Income (Loss) to Average Net Assets	Ratios of Expenses to Average Net Assets (Excluding Fee Reductions)	Portfolio Turnover (c)
CLASS A SHARES
Year Ended October 31, 2009		$	8.81	0.07		1.55		1.62	(0.09)	(0.09)		$	10.34		18.66	%(d)		$	15,304	1.50%	0.84%	1.57%	48%
Year Ended October 31, 2010			10.34	0.19		1.64		1.83	(0.08)	(0.08)			12.09		17.79	%(e)			21,642	1.25%	1.72%	1.30%	53%
Year Ended October 31, 2011			12.09	0.32		(0.06	)	0.26	(0.28)	(0.28)			12.07		2.08	%(f)			28,262	1.12%	2.60%	1.14%	74%
Year Ended October 31, 2012			12.07	0.23		0.75		0.98	(0.39)	(0.39)			12.66		8.51	%			29,490	1.15%	1.89%	1.15%	62%
Year Ended October 31, 2013			12.66	0.24		1.72		1.96	(0.23)	(0.23)			14.39		15.76	%			28,746	1.04%	1.79%	1.04%	35%
CLASS B SHARES
Year Ended October 31, 2009		$	8.76	0.01		1.55		1.56	(0.01)	(0.01)		$	10.31		17.80	%(d)		$	11,196	2.25%	0.07%	2.31%	48%
Year Ended October 31, 2010			10.31	0.11		1.64		1.75	(0.01)	(0.01)			12.05		17.01	%(e)			15,593	2.00%	0.97%	2.05%	53%
Year Ended October 31, 2011			12.05	0.23		(0.07	)	0.16	(0.20)	(0.20)			12.01		1.30	%(f)			18,799	1.87%	1.85%	1.90%	74%
Year Ended October 31, 2012			12.01	0.14		0.75		0.89	(0.30)	(0.30)			12.60		7.66	%			16,805	1.91%	1.18%	1.91%	62%
Year Ended October 31, 2013			12.60	0.14		1.72		1.86	(0.13)	(0.13)			14.33		14.89	%			15,633	1.80%	1.05%	1.80%	35%
CLASS C SHARES
Year Ended October 31, 2009		$	8.80	0.01		1.55		1.56	(0.01)	(0.01)		$	10.35		17.81	%(d)		$	1,507	2.25%	0.06%	2.30%	48%
Year Ended October 31, 2010			10.35	0.12		1.63		1.75	(0.01)	(0.01)			12.09		16.96	%(e)			3,497	2.01%	1.04%	2.06%	53%
Year Ended October 31, 2011			12.09	0.23		(0.07	)	0.16	(0.21)	(0.21)			12.04		1.25	%(f)			6,427	1.87%	1.85%	1.90%	74%
Year Ended October 31, 2012			12.04	0.14		0.76		0.90	(0.32)	(0.32)			12.62		7.77	%			5,908	1.91%	1.18%	1.91%	62%
Year Ended October 31, 2013			12.62	0.14		1.72		1.86	(0.13)	(0.13)			14.35		14.87	%			5,544	1.80%	1.04%	1.80%	35%

*	The per share amounts and percentages reflect income and expenses assuming inclusion of the Fund’s proportionate share of the income and expenses of the applicable HSBC Portfolios, the Fund does not include expenses of the affiliated and unaffiliated investment companies, in which the Fund invests.
(a)	Calculated based on average shares outstanding.
(b)	Total return calculations do not include any sales or redemption charges.
(c)	Portfolio turnover rate is calculated by aggregating the results of multiplying the Fund’s investment percentage in the respective Portfolios, affiliated and unaffiliated investment companies by their corresponding portfolio turnover rates. Portfolio turnover rate is calculated on the basis of the Fund as a whole without distinguishing between classes of shares issued.
(d)	During the year ended October 31, 2009, certain HSBC Portfolios, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.11%, 0.11% and 0.11% for Class A Shares, Class B Shares and Class C Shares, respectively.
(e)	During the year ended October 31, 2010, certain HSBC Portfolios, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.07%, 0.07% and 0.07% for Class A Shares, Class B Shares and Class C Shares, respectively.
(f)	During the year ended October 31, 2011, certain HSBC Portfolios, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.06%, 0.06% and 0.06% for Class A Shares, Class B Shares and Class C Shares, respectively.

32       HSBC WORLD SELECTION FUNDS See notes to financial statements.

MODERATE STRATEGY FUND

FinancialHighlights

Selected data for a share outstandingthroughout the periodsindicated.

				InvestmentActivities							Dividends												Ratios/Supplemental Data
	Net Asset Value, Beginning of Period			Net Investment Income (Loss)(a)		Net Realized and Unrealized Gains (Losses) from Investments			Total from Investment Activities		Net Investment Income			Total Dividends			Net Asset Value, End of Period			Total Return(b)			Net Assets at End of Period (000’s)			Ratio of Net Expenses to Average Net Assets			Ratio of Net Investment Income (Loss) to Average Net Assets			Ratios of Expenses to Average Net Assets (Excluding Fee Reductions)			Portfolio Turnover (c)
CLASS A SHARES
Year Ended October 31, 2009		$	8.69		0.13		1.39			1.52		(0.12	)		(0.12	)		$	10.09		17.75	%(d)		$	15,909		1.44	%		1.47	%		1.49	%		41	%
Year Ended October 31, 2010			10.09		0.25		1.38			1.63		(0.24	)		(0.24	)			11.48		16.39	%(e)			18,921		1.14	%		2.33	%		1.19	%		67	%
Year Ended October 31, 2011			11.48		0.37		(0.12	)		0.25		(0.44	)		(0.44	)			11.29		2.19	%(f)			23,719		1.06	%		3.16	%		1.09	%		63	%
Year Ended October 31, 2012			11.29		0.26		0.65			0.91		(0.32	)		(0.32	)			11.88		8.24	%			25,175		1.16	%		2.30	%		1.16	%		61	%
Year Ended October 31, 2013			11.88		0.23		1.04			1.27		(0.27	)		(0.27	)			12.88		10.80	%			24,671		1.08	%		1.86	%		1.08	%		30	%
CLASS B SHARES
Year Ended October 31, 2009		$	8.69		0.06		1.39			1.45		(0.06	)		(0.06	)		$	10.08		16.82	%(d)		$	14,230		2.19	%		0.71	%		2.24	%		41	%
Year Ended October 31, 2010			10.08		0.17		1.38			1.55		(0.17	)		(0.17	)			11.46		15.61	%(e)			18,362		1.89	%		1.59	%		1.94	%		67	%
Year Ended October 31, 2011			11.46		0.28		(0.10	)		0.18		(0.36	)		(0.36	)			11.28		1.51	%(f)			20,323		1.81	%		2.40	%		1.84	%		63	%
Year Ended October 31, 2012			11.28		0.19		0.63			0.82		(0.23	)		(0.23	)			11.87		7.43	%			17,615		1.92	%		1.64	%		1.92	%		61	%
Year Ended October 31, 2013			11.87		0.14		1.04			1.18		(0.18	)		(0.18	)			12.87		10.04	%			15,407		1.83	%		1.12	%		1.83	%		30	%
CLASS C SHARES
Year Ended October 31, 2009		$	8.49		0.06		1.35			1.41		(0.06	)		(0.06	)		$	9.84		16.75	%(d)		$	1,488		2.19	%		0.72	%		2.24	%		41	%
Year Ended October 31, 2010			9.84		0.17		1.35			1.52		(0.18	)		(0.18	)			11.18		15.55	%(e)			2,544		1.90	%		1.59	%		1.95	%		67	%
Year Ended October 31, 2011			11.18		0.27		(0.11	)		0.16		(0.36	)		(0.36	)			10.98		1.42	%(f)			3,859		1.81	%		2.40	%		1.84	%		63	%
Year Ended October 31, 2012			10.98		0.18		0.62			0.80		(0.23	)		(0.23	)			11.55		7.49	%			3,329		1.91	%		1.64	%		1.91	%		61	%
Year Ended October 31, 2013			11.55		0.13		1.01			1.14		(0.19	)		(0.19	)			12.50		9.96	%			4,109		1.83	%		1.10	%		1.83	%		30	%

*	The per share amounts and percentages reflect income and expenses assuming inclusion of the Fund’s proportionate share of the income and expenses of the applicable HSBC Portfolios, the Fund does not include expenses of the affiliated and unaffiliated investment companies, in which the Fund invests.
(a)	Calculated based on average shares outstanding.
(b)	Total return calculations do not include any sales or redemption charges.
(c)	Portfolio turnover rate is calculated by aggregating the results of multiplying the Fund’s investment percentage in the respective Portfolios, affiliated and unaffiliated investment companies by their corresponding portfolio turnover rates. Portfolio turnover rate is calculated on the basis of the Fund as a whole without distinguishing between classes of shares issued.
(d)	During the year ended October 31, 2009, certain HSBC Portfolios, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.09%, 0.09% and 0.09% for Class A Shares, Class B Shares and Class C Shares, respectively.
(e)	During the year ended October 31, 2010, certain HSBC Portfolios, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.06%, 0.06% and 0.06% for Class A Shares, Class B Shares and Class C Shares, respectively.
(f)	During the year ended October 31, 2011, certain HSBC Portfolios, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.04%, 0.04% and 0.04% for Class A Shares, Class B Shares and Class C Shares, respectively.

See notes to financial statements. HSBC WORLD SELECTION FUNDS       33

CONSERVATIVE STRATEGY FUND

FinancialHighlights

Selected data for a share outstandingthroughout the periodsindicated.*

				InvestmentActivities							Dividends												Ratios/Supplemental Data
	Net Asset Value, Beginning of Period			Net Investment Income (Loss)(a)		Net Realized and Unrealized Gains (Losses) from Investments			Total from Investment Activities		Net Investment Income			Total Dividends			Net Asset Value, End of Period			Total Return(b)			Net Assets at End of Period (000’s)			Ratio of Net Expenses to Average Net Assets			Ratio of Net Investment Income (Loss) to Average Net Assets			Ratios of Expenses to Average Net Assets (Excluding Fee Reductions)			Portfolio Turnover (c)
CLASS A SHARES
Year Ended October 31, 2009		$	8.84		0.14		1.16			1.30		(0.13	)		(0.13	)		$	10.01		14.95	%(d)		$	5,059		1.50	%		1.53	%		1.62	%		34	%
Year Ended October 31, 2010			10.01		0.26		1.11			1.37		(0.23	)		(0.23	)			11.15		13.86	%(e)			7,139		1.38	%		2.42	%		1.43	%		78	%
Year Ended October 31, 2011			11.15		0.36		(0.10	)		0.26		(0.46	)		(0.46	)			10.95		2.40	%(f)			8,946		1.19	%		3.21	%		1.22	%		54	%
Year Ended October 31, 2012			10.95		0.27		0.58			0.85		(0.33	)		(0.33	)			11.47		8.00	%			9,933		1.34	%		2.40	%		1.34	%		59	%
Year Ended October 31, 2013			11.47		0.20		0.51			0.71		(0.25	)		(0.25	)			11.93		6.28	%			9,255		1.26	%		1.75	%		1.26	%		31	%
CLASS B SHARES
Year Ended October 31, 2009		$	8.76		0.07		1.15			1.22		(0.07	)		(0.07	)		$	9.91		14.05	%(d)		$	4,907		2.25	%		0.77	%		2.38	%		34	%
Year Ended October 31, 2010			9.91		0.17		1.10			1.27		(0.16	)		(0.16	)			11.02		12.94	%(e)			7,411		2.14	%		1.68	%		2.19	%		78	%
Year Ended October 31, 2011			11.02		0.27		(0.09	)		0.18		(0.38	)		(0.38	)			10.82		1.68	%(f)			8,995		1.94	%		2.46	%		1.97	%		54	%
Year Ended October 31, 2012			10.82		0.18		0.58			0.76		(0.25	)		(0.25	)			11.33		7.21	%			9,810		2.10	%		1.67	%		2.10	%		59	%
Year Ended October 31, 2013			11.33		0.12		0.50			0.62		(0.18	)		(0.18	)			11.77		5.50	%			9,222		2.01	%		1.00	%		2.01	%		31	%
CLASS C SHARES
Year Ended October 31, 2009		$	9.00		0.07		1.18			1.25		(0.07	)		(0.07	)		$	10.18		13.97	%(d)		$	485		2.25	%		0.78	%		2.37	%		34	%
Year Ended October 31, 2010			10.18		0.18		1.14			1.32		(0.17	)		(0.17	)			11.33		13.07	%(e)			1,323		2.16	%		1.71	%		2.21	%		78	%
Year Ended October 31, 2011			11.33		0.28		(0.10	)		0.18		(0.39	)		(0.39	)			11.12		1.57	%(f)			2,486		1.94	%		2.49	%		1.96	%		54	%
Year Ended October 31, 2012			11.12		0.19		0.60			0.79		(0.25	)		(0.25	)			11.66		7.28	%			2,897		2.08	%		1.69	%		2.08	%		59	%
Year Ended October 31, 2013			11.66		0.12		0.52			0.64		(0.18	)		(0.18	)			12.12		5.53	%			3,442		2.01	%		0.98	%		2.01	%		31	%

*	The per share amounts and percentages reflect income and expenses assuming inclusion of the Fund’s proportionate share of the income and expenses of the applicable HSBC Portfolios, the Fund does not include expenses of the affiliated and unaffiliated investment companies, in which the Fund invests.
(a)	Calculated based on average shares outstanding.
(b)	Total return calculations do not include any sales or redemption charges.
(c)	Portfolio turnover rate is calculated by aggregating the results of multiplying the Fund’s investment percentage in the respective Portfolios, affiliated and unaffiliated investment companies by their corresponding portfolio turnover rates. Portfolio turnover rate is calculated on the basis of the Fund as a whole without distinguishing between classes of shares issued.
(d)	During the year ended October 31, 2009, certain HSBC Portfolios, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.08%, 0.08% and 0.08% for Class A Shares, Class B Shares and Class C Shares, respectively.
(e)	During the year ended October 31, 2010, certain HSBC Portfolios, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.05%, 0.05% and 0.05% for Class A Shares, Class B Shares and Class C Shares, respectively.
(f)	During the year ended October 31, 2011, certain HSBC Portfolios, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.02%, 0.02% and 0.02% for Class A Shares, Class B Shares and Class C Shares, respectively.

34      HSBC WORLD SELECTION FUNDS See notes to financial statements.

INCOME STRATEGY FUND

FinancialHighlights

Selected data for a share outstandingthroughout the periodsindicated.*

				InvestmentActivities						Dividends															Ratios/Supplemental Data
	Net Asset Value, Beginning of Period			Net Investment Income (Loss)(a)		Net Realized and Unrealized Gains (Losses) from Investments		Total from Investment Activities		Net Investment Income			Net Realized Gains from Investment Transactions			Total Dividends			Net Asset Value, End of Period			Total Return (b)			Net Assets at End of Period (000’s)			Ratio of Net Expenses to Average Net Assets (c)			Ratio of Net Investment Income (Loss) to Average Net Assets (c)			Ratios of Expenses to Average Net Assets (Excluding Fee Reductions) (c)			Portfolio Turnover (b)(d)
CLASS A SHARES
Period Ended October 31, 2012(e)		$	10.00		0.10		0.40		0.50		(0.07	)		—			(0.07	)		$	10.43		5.02	%		$	337		1.50	%		1.58	%		29.67	%		31	%
Year Ended October 31, 2013			10.43		0.18		0.08		0.26		(0.30	)		(0.03	)		(0.33	)			10.36		2.57	%		$	311		1.50	%		1.72	%		13.61	%		48	%
CLASS B SHARES
Period Ended October 31, 2012(e)		$	10.00		0.06		0.39		0.45		(0.04	)		—			(0.04	)		$	10.41		4.52	%		$	348		2.25	%		0.89	%		26.84	%		31	%
Year Ended October 31, 2013			10.41		0.10		0.08		0.18		(0.22	)		(0.03	)		(0.25	)			10.34		1.81	%		$	402		2.25	%		0.97	%		14.39	%		48	%
CLASS C SHARES
Period Ended October 31, 2012(e)		$	10.00		0.06		0.39		0.45		(0.04	)		—			(0.04	)		$	10.41		4.47	%		$	232		2.25	%		0.90	%		27.00	%		31	%
Year Ended October 31, 2013			10.41		0.09		0.09		0.18		(0.23	)		(0.03	)		(0.26	)			10.33		1.75	%		$	643		2.25	%		0.84	%		14.49	%		48	%

*	The expense ratios reflected do not include expenses of the affiliated and unaffiliated investment companies, in which the Fund invests.
(a)	Calculated based on average shares outstanding.
(b)	Not annualized for periods less than one year. Total return calculations do not include any sales or redemption charges.
(c)	Annualized for periods less than one year.
(d)	Portfolio turnover rate is calculated on the basis of the Fund as a whole without the distinguishing between the classes of shares issued.
(e)	Commenced operations on March 20, 2012.

See notes to financial statements. HSBC WORLD SELECTION FUNDS       35

HSBC WORLD SELECTION FUNDS

Notes to Financial Statements—as of October 31, 2013

1. Organization:

     The HSBC Funds (the “Trust”), a Massachusetts business trust organized on April 22, 1987, is registered under the Investment Company Act of 1940, as amended (the “Act”), as an open-end management investment company. As of October 31, 2013, the Trust is comprised of 15 separate operational funds, each a series of the HSBC Family of Funds, which also includes the HSBC Advisor Funds Trust and the HSBC Portfolios (collectively the “Trusts”). The accompanying financial statements are presented for the following 5 funds (individually a “Fund,”collectively the “Funds” or the “World Selection Funds”):

Fund

Aggressive Strategy Fund

Balanced Strategy Fund

Moderate Strategy Fund

Conservative Strategy Fund

Income Strategy Fund

     All of the World Selection Funds are diversified funds. Financial statements for all other funds of the Trusts are published separately.

     The World Selection Funds, excluding the Income Strategy Fund, (collectively the “World Selection Feeder Funds”), currently invest in the HSBC Growth Portfolio and HSBC Opportunity Portfolio (individually a “Portfolio,” collectively the “Portfolios”), each of which is a diversified series of the HSBC Portfolios (the “Portfolio Trust”). The Portfolios operate as master funds in master-feeder arrangements in addition to receiving investments from the World Selection Feeder Funds.

     The financial statements of the Portfolios, including the Schedules of Portfolio Investments, are included elsewhere in this report. The financial statements of the Portfolios should be read in conjunction with the financial statements of the World SelectionFunds.

	Proportionate	Proportionate
	Ownership Interest	Ownership Interest
	in HSBC Growth Portfolio	in HSBC Opportunity Portfolio
	on October 31, 2013 (%)	on October 31, 2013 (%)
Aggressive Strategy Fund	1.5	0.3
Balanced Strategy Fund	3.0	0.6
Moderate Strategy Fund	1.8	0.4
Conservative Strategy Fund	0.6	0.1

     Each of the World Selection Funds is a “fund of funds,” meaning that it seeks to achieve its investment objective by investing primarily in a combination of mutual funds managed by HSBC Global Asset Management (USA) Inc. (the “Adviser”) (the “Affiliated Underlying Funds”), as well as mutual funds managed by other investment advisers and exchange-traded funds (“Unaffiliated Underlying Funds” and, together with the Affiliated Underlying Funds, the “Underlying Funds”). Each World Selection Fund may also purchase and hold Exchange Traded Notes (“ETNs”), which are debt securities issued by financial institutions that pay returns based on the performance of a market index or other reference asset. The Underlying Funds may include private equity funds and real estate funds that are organized as mutual funds or Exchange Traded Funds (“ETFs”). Each World Selection Fund invests according to the investment objectives and strategies described in its Prospectus.

     The World Selection Funds are authorized to issue an unlimited number of shares of beneficial interest with a par value of $ 0.001 per share. Each Fund offers three classes of shares: Class A Shares, Class B Shares and Class C Shares. Class A Shares of the World Selection Funds (except, the Income Strategy Fund) have a maximum sales charge of 5.00% as a percentage of the original purchase price. The Class A Shares of the

36       HSBC WORLD SELECTION FUNDS

HSBC WORLD SELECTION FUNDS

Notes to Financial Statements—as of October 31, 2013 (continued)

Income Strategy Fund have a maximum sales charge of 4.75% as a percentage of the original purchase price. Class B Shares of the World Selection Funds are offered without any front-end sales charge, but will be subject to a contingent deferred sales charge (“CDSC”) ranging from a maximum of 4.00% if redeemed less than one year after purchase to 0.00% if redeemed more than four years after purchase. Class C Shares of the World Selection Funds are offered without any front-end sales charge, but will be subject to a maximum CDSC of 1.00% if redeemed less than one year after purchase. Each class of shares in the World Selection Funds has identical rights and privileges except with respect to arrangements pertaining to shareholder servicing and/or distribution, class-related expenses, voting rights on matters affecting a single class of shares, and exchange privileges of each class of shares. Effective as of August 1, 2013, Class B Shares may no longer be purchased or acquired by any new or existing Class B shareholder, except through dividend and/or capital gains reinvestment.

     Under the Trust’s organizational documents, the World Selection Funds’ officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the World Selection Funds. In addition, in the normal course of business, the Trust enters into contracts with its service providers, which also provide for indemnifications by the World Selection Funds. The World Selection Funds’ maximum exposure under these arrangements is unknown as this would involve any future claims that may be made against the World Selection Funds. However, based on experience, the Trust expects the risk of loss to be remote.

2. Significant Accounting Policies:

     The following is a summary of the significant accounting policies followed by the World Selection Funds in the preparation of their financial statements. The policies are in conformity with U.S. generally accepted accounting principles (“GAAP’’). The preparation of financial statements requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

Securities Valuation:

     The World Selection Funds record their investments in the Underlying Funds at the net asset value reported by those funds. The World SelectionFeeder Funds record their investments in the Portfolios at fair value. The underlying securities of the Portfolios are recorded at fair value, as more fully discussed in the notes to those financial statements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The valuation techniques used to determine fair value in funds or Portfolios in which the World Selection Funds are invested are described in their respective notes to financial statements. Valuation techniques employed by the World Selection Funds’ are further described in Note 3 below.

Investment Transactions and Related Income:

     The World SelectionFeeder Funds record daily their proportionate income, expenses, unrealized appreciation and depreciation and realized gains and losses derived from their respective Portfolios. Dividend income is recorded on the ex-dividend date for the Underlying Funds. Changes in holdings of the Underlying Funds for each World Selection Fund are reflected not later than one business day after trade date. However, for financial reporting purposes, changes in holdings of the Underlying Funds are accounted for on trade date. In addition, the World Selection Funds accrue their own expenses daily.

HSBC WORLD SELECTION FUNDS       37

HSBC WORLD SELECTION FUNDS

Notes to Financial Statements—as of October 31, 2013 (continued)

Allocations:

     Expenses directly attributable to a Fund are charged to that Fund. Expenses not directly attributable to a Fund are allocated proportionately among the applicable series within the Trusts in relation to the net assets of each fund or on another reasonable basis. Class specific expenses are charged directly to the class incurring the expense. In addition, income, expenses (other than class specific expenses), and unrealized and realized gains and losses are allocated to each class based on relative net assets on a daily basis.

Dividends to Shareholders:

     Dividends to shareholders from net investment income, if any, are declared and distributed monthly in the case of the Income Strategy Fund, quarterly in the case of the Moderate Strategy Fund and Conservative Strategy Fund, and annually in the case of the Aggressive Strategy Fund and Balanced Strategy Fund.

     The World Selection Funds’ net realized gains, if any, are distributed to shareholders at least annually. Additional distributions are also made to the World Selection Funds’ shareholders to the extent necessary to avoid the federal excise tax on certain undistributed income and net capital gains of regulated investment companies.

     The amount and character of net investment income and net realized gains distributions are determined in accordance with federal income tax regulations which may differ from GAAP. These “book/tax” differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature (e.g., reclassification of market discounts, certain gain/loss, paydowns, and certain distributions), such amounts are reclassified within the composition of net assets; temporary differences (e.g., wash losses and post-October loss deferrals) do not require reclassification. The World Selection Funds may utilize equalization accounting for tax purposes and designate earnings and profits, including net realized gains distributed to shareholders on redemption of shares, as a part of the dividends paid deduction for income tax purposes. To the extent distributions to shareholders from net investment income and net realized gains exceed net investment income and net realized gains for tax purposes, they are reported as distributions of capital.

Federal Income Taxes:

     Each Fund is a separate taxable entity for federal income tax purposes. Each Fund has qualified and intends to continue to qualify each year as a “regulated investment company” under Subchapter M of the Internal Revenue Code, as amended, and to distribute substantially all of its taxable net investment income and net realized gains, if any, to its shareholders. Accordingly, no provision for federal income or excise tax is required.

     Management of the Funds has reviewed tax positions taken in tax years that remain subject to examination by all major tax jurisdictions, including federal (i.e., the last four tax year ends and the interim tax period since then, as applicable). Management believes that there is no tax liability resulting from unrecognized tax benefits related to uncertain tax positions taken.

38       HSBC WORLD SELECTION FUNDS

HSBC WORLD SELECTION FUNDS

Notes to Financial Statements—as of October 31, 2013 (continued)

New Accounting Pronouncements:

     In January 2013, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2013-01 “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities” (“ASU 2013-01”), which amended Accounting Standards Codification Subtopic 210-20, Balance Sheet Offsetting. ASU 2013-01 clarified the scope of ASU No. 2011-11 “Disclosures about Offsetting Assets and Liabilities” (“ASU 2011-11”). ASU 2011-11 requires an entity to disclose information about offsetting and related arrangements to enable users of the financial statements to understand the effect of those arrangements on the entity’s financial position. ASU 2013-01 clarifies the scope of ASU 2011-11 as applying to derivatives accounted for in accordance with Topic 815, Derivatives and Hedging, including bifurcated embedded derivatives, repurchase agreements and reverse repurchase agreements, and securities borrowing and securities lending transactions that are offset either in accordance with other requirements of GAAP or subject to an enforceable master netting arrangement or similar agreement. The guidance in ASU 2013-01 and ASU 2011-11 is effective for interim and annual periods beginning on or after January 1, 2013. Management is evaluating any impact ASU 2013-01 and ASU 2011-11 may have on the World Selection Funds’ financial statements.

3. Investment Valuation Summary:

The valuation techniques employed by the World Selection Funds, as described below, maximize the use of observable inputs and minimize the use of unobservable inputs in determining fair value. The inputs used for valuing the World Selection Funds’ investments are summarized in the three broad levels listed below:

• Level 1: quoted prices in active markets for identical assets

• Level 2: other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.)

• Level 3: significant unobservable inputs (including a Fund’s own assumptions in determining the fair value of investments)

Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The Funds determine transfers between fair value hierarchy levels at the reporting period end. The inputs or methodology used for valuing investments are not necessarily an indication of the risk associated with investing in those investments.

The World Selection Funds record their investments in the Underlying Funds at the net asset value reported by those funds and are typically categorized as Level 1 in the fair value hierarchy. The World Selection Feeder Funds record their investments in their respective Portfolios at fair value and are typically categorized as a Level 2 in the fair value hierarchy. The underlying securities of the Portfolios are recorded at fair value, as discussed more fully in the Notes to Financial Statements of the Portfolios included elsewhere in this report.

For the year ended October 31, 2013, there were no Level 3 investments for which significant unobservable inputs were used to determine fair value.

HSBC WORLD SELECTION FUNDS       39

HSBC WORLD SELECTION FUNDS

Notes to Financial Statements—as of October 31, 2013 (continued)

     The following is a summary of the valuation inputs used as of October 31, 2013 in valuing the World Selection Funds’ investments based upon the three levels defined above:

	LEVEL 1($)	LEVEL 2($)	LEVEL 3($)	Total($)
Aggressive Strategy Fund
Investment Securities:
Affiliated Investment Companies	266,099	—	—	266,099
Affiliated Portfolios(a)	—	2,113,741	—	2,113,741
Unaffiliated Investment Companies	7,689,100	—	—	7,689,100
Exchange Traded Funds	8,378,769	—	—	8,378,769
Total Investment Securities	16,333,968	2,113,741	—	18,447,709
Balanced Strategy Fund
Investment Securities:
Affiliated Investment Companies	5,136,363	—	—	5,136,363
Affiliated Portfolios(a)	—	4,147,938	—	4,147,938
Unaffiliated Investment Companies	22,832,816	—	—	22,832,816
Exchange Traded Funds	17,902,703	—	—	17,902,703
Total Investment Securities	45,871,882	4,147,938	—	50,019,820
Moderate Strategy Fund
Investment Securities:
Affiliated Investment Companies	5,368,586	—	—	5,368,586
Affiliated Portfolios(a)	—	2,483,099	—	2,483,099
Unaffiliated Investment Companies	24,389,858	—	—	24,389,858
Exchange Traded Funds	12,018,641	—	—	12,018,641
Total Investment Securities	41,777,085	2,483,099	—	44,260,184
Conservative Strategy Fund
Investment Securities:
Affiliated Investment Companies	2,767,582	—	—	2,767,582
Affiliated Portfolios(a)	—	769,751	—	769,751
Unaffiliated Investment Companies	14,229,362	—	—	14,229,362
Exchange Traded Funds	4,199,359	—	—	4,199,359
Total Investment Securities	21,196,303	769,751	—	21,966,054
Income Strategy Fund
Investment Securities:
Affiliated Investment Companies	143,417	—	—	143,417
Unaffiliated Investment Companies	1,173,157	—	—	1,173,157
Exchange Traded Funds	20,045	—	—	20,045
Total Investment Securities	1,336,619	—	—	1,336,619

____________________

(a)     Investments in Affiliated Portfolios represent ownership interests in the Portfolios. Due to the Funds’ master-feeder structure, the inputs used for valuing these instruments are categorized as Level 2.

40       HSBC WORLD SELECTION FUNDS

HSBC WORLD SELECTION FUNDS

Notes to Financial Statements—as of October 31, 2013 (continued)

4. Related Party Transactions and Other Agreements and Plans:

Investment Management:

     HSBC Global Asset Management (USA), Inc. (“HSBC” or the “Investment Adviser”), a wholly owned subsidiary of HSBC Bank USA, N.A., a national bank organized under the laws of the United States, acts as Investment Adviser to the World Selection Funds. As Investment Adviser, HSBC manages the investments of the World Selection Funds and continuously reviews, supervises and administers the World Selection Funds’ investments pursuant to an Investment Advisory Contract. For its services as Investment Adviser, HSBC is entitled to receive a fee, computed daily and paid monthly, based on average daily net assets, at an annual rate of 0.25% for each Fund.

Administration:

     HSBC serves the World Selection Funds as Administrator. Under the terms of the Administration Agreement, HSBC receives from the World Selection Funds (as well as other funds in the Trusts combined) a fee, accrued daily and paid monthly, at an annual rate of:

Based on Combined Average Daily Net Assets of	Fee Rate(%)
Up to $10 billion	0.0550
In excess of $10 billion but not exceeding $20 billion	0.0350
In excess of $20 billion but not exceeding $50 billion	0.0275
In excess of $50 billion	0.0250

     The fee rates and breakpoints are determined on the basis of the aggregate average daily net assets of the Trusts. The total administration fee paid to HSBC is allocated to each series of the Trusts based upon its proportionate share of the aggregate net assets of the Trusts. For assets invested in the Portfolios by World Selection Feeder Funds, the Portfolios pay half of the administration fee and the World Selection Feeder Funds pay half, for a combination of the total fee rate set forth above. Certain administration fees of the Portfolios also may be reduced by treating them as apportioned in part to other funds making investments in the Portfolios in master-feeder structures. An amount equal to 50% of the administration fee is deemed to be class specific.

     Pursuant to a Sub-Administration Agreement with HSBC, Citi Fund Services Ohio, Inc. (“Citi’’), a wholly-owned subsidiary of Citigroup, Inc., serves as the Sub-Administrator for the Trusts subject to the general supervision by the Trusts’ Board of Trustees (the “Board”) and HSBC. For these services, Citi is entitled to a fee, payable by HSBC, at an annual rate equivalent to the fee rates set forth above subject to certain reductions associated with services provided to new funds minus 0.02%, which is retained by HSBC.

     Under a Compliance Services Agreement between the Trusts and Citi (the “CCO Agreement”), Citi makes an employee available to serve as the Trusts’ Chief Compliance Officer (the “CCO”). Under the CCO Agreement, Citi also provides infrastructure and support in implementing the written policies and procedures comprising the Trusts’ compliance program, including support services to the CCO. For the services provided under the CCO Agreement, the Trusts paid Citi $287,560 for the year ended October 31, 2013, plus reimbursement of certain out of pocket expenses. Expenses incurred by each Fund are reflected on the Statements of Operations as “Compliance Services.” Citi pays the salary and other compensation earned by individuals performing these services, as employees of Citi.

HSBC WORLD SELECTION FUNDS       41

HSBC WORLD SELECTION FUNDS

Notes to Financial Statements—as of October 31, 2013 (continued)

Distribution Arrangements:

     Foreside Distribution Services, L.P. (“Foreside”), a wholly-owned subsidiary of Foreside Financial Group LLC, serves the Trustas Distributor (the “Distributor”). The Trust has adopted a non-compensatory Distribution Plan and Agreement (the “Distribution Plan”) pursuant to Rule 12b-1 of the Act. The Distribution Plan provides for reimbursement of expenses incurred by the Distributor related to distribution and marketing, at a rate not to exceed 0.25%, 1.00%, and 1.00% of the average daily net assets of Class A Shares (currently not being charged), Class B Shares (currently charging 0.75%), and Class C Shares (currently charging 0.75%) of the World Selection Funds, respectively. For the year ended October 31, 2013, Foreside, as Distributor, also received $213,520, $105,439, and $49,940 in commissions from sales of the Trusts, for Class A Shares, Class B Shares, and Class C Shares, respectively of which $584, $89, and $0 were reallocated to HSBC-affiliated brokers and dealers, for Class A Shares, Class B Shares, and Class C Shares, respectively.

Shareholder Servicing:

     The Trust has adopted a Shareholder Services Plan which provides for payments to shareholder servicing agents (which currently consist of HSBC and its affiliates) for providing various shareholder services. For performing these services, the shareholder servicing agents receive a fee that is computed daily and paid monthly up to 0.25% of the average daily net assets of each of the Class A Shares, Class B Shares and Class C Shares of the World Selection Funds. The fees paid to the Distributor pursuant to the Distribution Plan and to shareholder servicing agents pursuant to the Shareholder Services Plan currently will not exceed, in the aggregate, 0.25% of the average daily net assets of Class A Shares and 1.00% of the average daily net assets of Class B Shares and Class C Shares.

Fund Accounting and Transfer Agency:

     Citi provides fund accounting and transfer agency services for each Fund. As transfer agent, Citi receives a fee based on the number of funds and shareholder accounts, subject to certain minimums, reductions associated with services provided to new funds and reimbursement of certain expenses. As fund accountant, Citi receives an annual fee per Fund and share class, subject to minimums, reductions associated with services provided to new funds and reimbursement of certain expenses. Citi receives additional fees paid by the Trust for blue sky exemption services.

Independent Trustees:

     The Trusts pay each Independent Trustee an annual retainer of $100,000. The Trusts pay a fee of $10,000 for each regular meeting of the Board attended and a fee of $3,000 for each special meeting attended. The Trusts pay each Committee Chair an annual retainer of $3,000, with the exception of the Chair of the Audit Committee, who receives a retainer of $6,000. The Trusts also pay the Chairman of the Boardan additional annual retainer of $24,000. In addition, for time expended on Board duties outside normal meetings, which is authorized by the Board, a Trustee is compensated at the rate of $500 per hour, up to a maximum of $3,000 per day.

Fee Reductions:

     The Investment Adviser has agreed to contractually limit through March 1, 2014 the total annual expenses, exclusive of interest, taxes, brokerage commissions, extraordinary expenses and estimated indirect expenses attributable to the Funds’ investments in investment companies other than the HSBC Growth Portfolio and the HSBC Opportunity Portfolio. Each Fund Class has its own expense limitations based on the average daily net assets for any full fiscal year as follows: Class A Shares 1.50%, Class B Shares 2.25%, Class C Shares 2.25%.

42       HSBC WORLD SELECTION FUNDS

HSBC WORLD SELECTION FUNDS

Notes to Financial Statements—as of October 31, 2013 (continued)

     Any amounts contractually waived or reimbursed by the Investment Adviser will be subject to repayment by the respective Fund to the Investment Adviser within three years to the extent that the repayment will not cause the Fund’s operating expenses to exceed the contractual expense limit that was in effect at the time of such waiver or reimbursement. During the year ended October 31, 2013, the Investment Adviser did not recapture any of its prior contractual waivers or reimbursements. As of October 31, 2013, the repayments that may potentially be made by the Funds are as follows:

Fund	2016($)	2015($)	2014($)	Total
Aggressive Strategy Fund	421	27,768	19,298	47,487
Income Strategy Fund	138,725	77,417	N/A	216,142

The Administrator and Citi may voluntarily waive/reimburse fees to help support the expense limits of the Funds. In addition, HSBC, in its role as Investment Adviser and Administrator, may waive/reimburse additional fees at its discretion. Any voluntary fee waivers/reimbursements are not subject to recoupment in subsequent fiscal periods. Voluntary waivers/reimbursements may be stopped at any time. Amounts waived/reimbursed by the Investment Adviser, Administrator, and Citi are reported separately on the Statements of Operations, as applicable.

Affiliated Transactions:

A summary of each Fund’s investment in affiliated investment companies (excluding investments in the Affiliated Portfolios) for the year ended October 31, 2013 are as follows:

								Net			Change in
					Proceeds			Capital and			Unrealized
	Value		Purchases		from			Realized			Appreciation			Value		Dividend
	10/31/2012		at Cost		Sales			Gain (Loss)			(Depreciation)			10/31/2013		Income
	($)		($)		($)			($)			($)			($)		($)
Aggressive Strategy Fund
HSBC Prime Money Market Fund - Class I		13,222		571,643		(542,374	)		—			—			42,491		17
HSBC Emerging Markets Debt Fund - Class I		126,737		238,229		(133,815	)		(8,732	)		1,189			223,608		6,191
HSBC Emerging Markets Local Debt Fund -Class I		177,882		26,230		(189,161	)		(1,737	)		(13,214	)		—		2,617
Balanced Strategy Fund
HSBC Prime Money Market Fund - Class I		7,556		2,067,514		(1,886,738	)		—			—			188,332		297
HSBC Emerging Markets Debt Fund - Class I		3,360,039		1,385,304		(1,010,307	)		78,840			(337,181	)		3,476,695		145,801
HSBC Emerging Markets Local Debt Fund - Class I		1,855,546		358,400		(626,313	)		33,372			(149,669	)		1,471,336		41,061
Moderate Strategy Fund
HSBC Prime Money Market Fund - Class I		444,668		1,807,980		(1,894,701	)		—			—			357,947		508
HSBC Emerging Markets Debt Fund - Class I		3,137,780		1,028,962		(728,282	)		103,379			(303,758	)		3,238,081		136,996
HSBC Emerging Markets Local Debt Fund - Class I		2,064,417		385,335		(541,929	)		28,053			(163,318	)		1,772,558		47,747
Conservative Strategy Fund
HSBC Prime Money Market Fund - Class I		251,847		963,128		(930,467	)		—			—			284,508		260
HSBC Emerging Markets Debt Fund - Class I		1,427,385		528,541		(357,924	)		31,760			(138,715	)		1,491,047		62,242
HSBC Emerging Markets Local Debt Fund - Class I		1,138,041		142,679		(209,511	)		10,340			(89,522	)		992,027		26,985
Income Strategy Fund
HSBC Prime Money Market Fund - Class I		13,077		229,722		(226,026	)		—			—			16,773		16
HSBC Emerging Markets Debt Fund - Class I		37,955		41,751		(12,488	)		429			(3,551	)		64,096		2,106
HSBC Emerging Markets Local Debt Fund -Class I		47,112		39,180		(19,626	)		447			(4,565	)		62,548		1,497

HSBC WORLD SELECTION FUNDS        43

HSBC WORLD SELECTION FUNDS

Notes to Financial Statements—as of October 31, 2013 (continued)

5. Investment Transactions:

     Cost of purchases and proceeds from sales of securities (excluding securities maturing less than one year from acquisition) for the year ended October 31, 2013 were as follows:

Fund	Purchases($)	Sales($)
Aggressive Strategy Fund	5,093,809	6,713,132
Balanced Strategy Fund	14,292,199	20,104,586
Moderate Strategy Fund	11,329,834	14,951,499
Conservative Strategy Fund	6,164,269	6,937,692
Income Strategy Fund	1,007,422	523,784

     Contributions and withdrawals of the respective Portfolios for the year ended October 31, 2013 totaled:

Fund	Contributions($)		Withdrawals($)
Aggressive Strategy Fund		1,954,968		5,160,230
Balanced Strategy Fund		5,876,909		16,216,761
Moderate Strategy Fund		4,470,891		11,596,026
Conservative Strategy Fund		2,898,142		5,364,850

6. Federal Income Tax Information:

     At October 31, 2013, the cost basis of securities (which excludes investments in the Affiliated Portfolios) for federal income tax purposes, gross unrealized appreciation, gross unrealized depreciation and net unrealized appreciation/depreciation were as follows:

							Net Unrealized
		Tax Unrealized		Tax Unrealized			Appreciation/
	Tax Cost($)	Appreciation($)		Depreciation($)			(Depreciation)($)
Aggressive Strategy Fund	14,161,086		2,231,796		(58,914	)		2,172,882
Balanced Strategy Fund	42,375,327		4,599,486		(1,102,931	)		3,496,555
Moderate Strategy Fund	39,746,871		3,161,982		(1,131,768	)		2,030,214
Conservative Strategy Fund	20,522,237		1,149,918		(475,852	)		674,066
Income Strategy Fund	1,342,001		23,252		(28,634	)		(5,382	)

     The tax character of dividends paid by the World Selection Funds as of the tax year ended October 31, 2013, was as follows:

	Dividends paid from
			Net Long Term	Total Taxable		Return of	Total Dividends
	Ordinary Income($)		Capital Gains($)	Dividends($)		Capital($)	Paid($)(1)
Aggressive Strategy Fund		31,802	—		31,802	—		31,802
Balanced Strategy Fund		755,006	—		755,006	—		755,006
Moderate Strategy Fund		838,380	—		838,380	—		838,380
Conservative Strategy Fund		403,395	—		403,395	—		403,395
Income Strategy Fund		27,813	—		27,813	—		27,813

44       HSBC WORLD SELECTION FUNDS

HSBC WORLD SELECTION FUNDS

Notes to Financial Statements—as of October 31, 2013 (continued)

     The tax character of dividends paid by the World Selection Funds as of the tax year ended October 31, 2012, was as follows:

	Dividends paid from
			Net Long Term	Total Taxable		Return of	Total Dividends
	Ordinary Income($)		Capital Gains($)	Dividends($)		Capital($)	Paid($)(1)
Aggressive Strategy Fund		92,405	—		92,405	—		92,405
Balanced Strategy Fund		1,541,114	—		1,541,114	—		1,541,114
Moderate Strategy Fund		1,134,889	—		1,134,889	���		1,134,889
Conservative Strategy Fund		556,629	—		556,629	—		556,629
Income Strategy Fund		2,407	—		2,407	—		2,407

____________________
 

(1) Total dividends paid may differ from the amount reported in the Statement of Changes in Net Assets because dividends are recognized when actually paid for tax purposes.

     As of the tax year ended October 31, 2013, the components of accumulated earnings/(deficit) on a tax basis for the World Selection Funds were as follows:

													Total
	Undistributed		Undistributed	Undistributed					Accumulated	Unrealized			Accumulated
	Ordinary		Tax Exempt	Long Term		Accumulated		Dividends	Capital and	Appreciation/			Earnings/
	Income($)		Income($)	Capital Gains($)		Earnings($)		Payable($)	Other Losses($)	(Depreciation)($)(1)			(Deficit)($)
Aggressive Strategy Fund		19,139	—		1,042,364		1,061,503	—	—		2,987,938			4,049,441
Balanced Strategy Fund		561,014	—		2,808,513		3,369,527	—	—		5,223,256			8,592,783
Moderate Strategy Fund		70,957	—		1,711,810		1,782,767	—	—		3,090,901			4,873,668
Conservative Strategy Fund		122,965	—		550,496		673,461	—	—		1,003,008			1,676,469
Income Strategy Fund		17,522	—		7,386		24,908	—	—		(5,382	)		19,526

____________________
 

(1) The differences between book-basis and tax-basis unrealized appreciation/depreciation are attributable primarily to: tax deferral of losses on wash sales, the realization for tax purposes of unrealized gains/losses on certain derivative instruments, the difference between book and tax amortization methods for premium and market discount, the realization for tax purposes of unrealized gains/losses on investments in passive foreign investment companies and the return of capital adjustments from real estate investment trusts.

     During the latest tax year ended October 31, 2013, the following Funds utilized capital loss carryforwards to offset capital gains realized:

	Amount ($)
Aggressive Strategy Fund	290,415
Balanced Strategy Fund	265,735
Moderate Strategy Fund	472,739
Conservative Strategy Fund	126,294

7. Subsequent Events:

     Management has evaluated events and transactions through the date the financial statements were issued, for purposes of recognition or disclosure in these financial statements and there are no subsequent events to report.

HSBC WORLD SELECTION FUNDS       45

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Trustees of
HSBC Funds:

We have audited the accompanying statements of assets and liabilities of HSBC World Selection Funds – Aggressive Strategy Fund, Balanced Strategy Fund, Moderate Strategy Fund, Conservative Strategy Fund and Income Strategy Fund (the Funds), including the schedules of portfolio investments, as of October 31, 2013, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the years or periods in the two-year period then ended and the financial highlights for each of the years or periods in the five-year period then ended. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the auditto obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of October 31, 2013, by correspondence with the custodian, transfer agents, or by other appropriate auditing procedures. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Funds as of October 31, 2013, the results of their operations for the year then ended, the changes in their net assets for each of the years or periods in the two-year period then ended, and the financial highlights for each of the years or periods in the five-year period then ended, in conformity with U.S. generally accepted accounting principles.

Columbus, Ohio
December 27, 2013

46       HSBC WORLD SELECTION FUNDS

HSBC WORLD SELECTION FUNDS

Other Federal Income Tax Information—as of October 31, 2013 (Unaudited)

     During the year ended October 31, 2013, the following World Selection Fund declared capital gain distributions:

	Short Term Capital Gain	Long Term Capital Gain
	Distributions ($)	Distributions ($)
Income Strategy Fund	6,075	—

     For the year ended October 31, 2013, the following percentages of the total ordinary income dividends paid by the World Selection Funds qualify for the corporate dividends received deduction available to corporate shareholders:

	Dividends Received Deduction (%)
Aggressive Strategy Fund		100.00
Balanced Strategy Fund		31.18
Moderate Strategy Fund		22.42
Conservative Strategy Fund		12.05
Income Strategy Fund		6.05

     For the year ended October 31, 2013, dividends paid by the World Selection Funds may be subject to a maximum tax rate of 15%, as provided for by the Jobs and Growth Tax Relief Reconciliation Act of 2003. The World Selection Funds intend to designate the maximum amount allowable as taxed at a maximum rate of 15%. Complete information will be reported in conjunction with your 2013 Form 1099-DIV:

	Qualified Dividend Income (%)
Aggressive Strategy Fund		100.00
Balanced Strategy Fund		44.11
Moderate Strategy Fund		45.85
Conservative Strategy Fund		22.80
Income Strategy Fund		6.86

HSBC WORLD SELECTION FUNDS       47

HSBC WORLD SELECTION FUNDS

Table of Shareholder Expenses—as of October 31, 2013 (Unaudited)

     As a shareholder of the World Selection Funds, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, redemption fees and exchange fees; and (2) ongoing costs, including management fees, distribution and/or shareholder servicing fees and other World Selection Fund expenses (including expenses allocated from the Portfolios). These examples are intended to help you understand your ongoing costs (in dollars) of investing in the World Selection Funds and to compare these costs with the ongoing costs of investing in other mutual funds.

     These examples are based on an investment of $1,000 invested at the beginning of the period and held for the entire period from May 1, 2013 through October 31, 2013.

Actual Example

     The table below provides information about actual account values and actual expenses. You may use the information below, 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 table under the heading entitled ”Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

											Annualized
		Beginning			Ending			Expenses Paid			Expense Ratio
		Account Value			Account Value			During Period*			During Period
		5/1/13			10/31/13			5/1/13 - 10/31/13			5/1/13 - 10/31/13
Aggressive Strategy Fund	Class A Shares		$	1,000.00		$	1,086.50		$	7.99	1.52%
	Class B Shares			1,000.00			1,082.40			11.91	2.27%
	Class C Shares			1,000.00			1,082.00			11.91	2.27%
Balanced Strategy Fund	Class A Shares			1,000.00			1,051.10			5.48	1.06%
	Class B Shares			1,000.00			1,047.50			9.39	1.82%
	Class C Shares			1,000.00			1,047.40			9.39	1.82%
Moderate Strategy Fund	Class A Shares			1,000.00			1,026.50			5.67	1.11%
	Class B Shares			1,000.00			1,023.30			9.49	1.86%
	Class C Shares			1,000.00			1,022.90			9.48	1.86%
Conservative Strategy Fund	Class A Shares			1,000.00			1,004.50			6.62	1.31%
	Class B Shares			1,000.00			1,001.50			10.39	2.06%
	Class C Shares			1,000.00			1,001.70			10.44	2.07%
Income Strategy Fund	Class A Shares			1,000.00			985.30			7.51	1.50%
	Class B Shares			1,000.00			981.60			11.24	2.25%
	Class C Shares			1,000.00			980.80			11.23	2.25%

____________________
 

* Expenses are equal to the average account value over the period multiplied by the Fund’s annualized expense ratio, multiplied by 184/365 (to reflect the one half year period).

48       HSBC WORLD SELECTION FUNDS

HSBC WORLD SELECTION FUNDS

Table of Shareholder Expenses—as of October 31, 2013 (Unaudited) (continued)

Hypothetical Example for Comparison Purposes

     The table below provides information about hypothetical account values and hypothetical expenses based on the World Selection Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the World Selection 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 this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

     Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

											Annualized
		Beginning			Ending			Expenses Paid			Expense Ratio
		Account Value			Account Value			During Period*			During Period
		5/1/13			10/31/13			5/1/13 - 10/31/13			5/1/13 - 10/31/13
Aggressive Strategy Fund	Class A Shares		$	1,000.00		$	1,017.54		$	7.73	1.52%
	Class B Shares			1,000.00			1,013.76			11.52	2.27%
	Class C Shares			1,000.00			1,013.76			11.52	2.27%
Balanced Strategy Fund	Class A Shares			1,000.00			1,019.86			5.40	1.06%
	Class B Shares			1,000.00			1,016.03			9.25	1.82%
	Class C Shares			1,000.00			1,016.03			9.25	1.82%
Moderate Strategy Fund	Class A Shares			1,000.00			1,019.61			5.65	1.11%
	Class B Shares			1,000.00			1,015.83			9.45	1.86%
	Class C Shares			1,000.00			1,015.83			9.45	1.86%
Conservative Strategy Fund	Class A Shares			1,000.00			1,018.60			6.67	1.31%
	Class B Shares			1,000.00			1,014.82			10.46	2.06%
	Class C Shares			1,000.00			1,014.77			10.51	2.07%
Income Strategy Fund	Class A Shares			1,000.00			1,017.64			7.63	1.50%
	Class B Shares			1,000.00			1,013.86			11.42	2.25%
	Class C Shares			1,000.00			1,013.86			11.42	2.25%

____________________
 

* Expenses are equal to the average account value over the period multiplied by the Fund’s annualized expense ratio, multiplied by 184/365 (to reflect the one half year period).

HSBC WORLD SELECTION FUNDS       49

HSBC GROWTH PORTFOLIO

Schedule of Portfolio Investments—as of October 31, 2013

Common Stocks – 98.9%
	Shares	Value ($)
Aerospace & Defense – 3.1%
Precision Castparts Corp.	6,300	1,596,735
United Technologies Corp.	11,250	1,195,312
		2,792,047
Airlines – 0.7%
Delta Air Lines, Inc.	23,050	608,059
Auto Components – 1.2%
BorgWarner, Inc.	10,200	1,051,926
Biotechnology – 9.1%
Alexion Pharmaceuticals, Inc. (a)	7,300	897,535
Amgen, Inc.	13,850	1,606,600
Biogen Idec, Inc. (a)	6,900	1,684,911
Celgene Corp. (a)	14,050	2,086,284
Gilead Sciences, Inc. (a)	25,650	1,820,894
		8,096,224
Capital Markets – 3.7%
BlackRock, Inc.	5,365	1,613,846
Morgan Stanley	45,900	1,318,707
The Charles Schwab Corp.	13,800	312,570
		3,245,123
Chemicals – 4.1%
Ecolab, Inc.	9,500	1,007,000
Monsanto Co.	25,149	2,637,627
		3,644,627
Communications Equipment – 1.5%
F5 Networks, Inc. (a)	6,200	505,362
Qualcomm, Inc.	12,350	857,955
		1,363,317
Computers & Peripherals – 3.1%
Apple, Inc.	5,210	2,721,444
Diversified Financial Services – 1.2%
American Express Co.	13,100	1,071,580
Energy Equipment & Services – 1.5%
Schlumberger Ltd.	14,000	1,312,080
Food & Staples Retailing – 2.4%
Costco Wholesale Corp.	6,900	814,200
CVS Caremark Corp.	15,400	958,804
Whole Foods Market, Inc.	5,400	340,902
		2,113,906
Health Care Providers & Services – 0.9%
Catamaran Corp. (a)	16,400	770,144
Health Care Technology – 1.7%
athenahealth, Inc. (a)	3,600	480,636
Cerner Corp. (a)	18,000	1,008,540
		1,489,176
Hotels, Restaurants & Leisure – 3.8%
Chipotle Mexican Grill, Inc. (a)	1,170	616,555
Starbucks Corp.	23,200	1,880,360
Wynn Resorts Ltd.	5,200	864,500
		3,361,415
Internet & Catalog Retail – 6.8%
Amazon.com, Inc. (a)	8,235	2,997,787
Priceline.com, Inc. (a)	2,920	3,077,184
		6,074,971
Internet Software & Services – 9.4%
Baidu, Inc. (a)	4,400	707,960
eBay, Inc. (a)	30,150	1,589,206
Facebook, Inc., Class A(a)	35,100	1,764,126
Google, Inc., Class A(a)	3,550	3,658,559
LinkedIn Corp., Class A(a)	2,900	648,643
		8,368,494
IT Services – 6.3%
Cognizant Technology Solutions Corp.,
Class A(a)	12,100	1,051,853
MasterCard, Inc., Class A	1,955	1,401,930
Visa, Inc., Class A	16,100	3,166,387
		5,620,170
Machinery – 2.7%
Danaher Corp.	33,000	2,378,970
Media – 5.0%
CBS Corp., Class B	19,600	1,159,144
Liberty Global plc, Class A(a)	11,700	916,929
The Walt Disney Co.	14,400	987,696
Twenty-First Century Fox, Inc., Class A	39,750	1,354,680
		4,418,449
Oil, Gas & Consumable Fuels – 4.1%
EOG Resources, Inc.	4,300	767,120
Noble Energy, Inc.	14,000	1,049,020
Pioneer Natural Resources Co.	4,700	962,466
Range Resources Corp.	11,400	863,094
		3,641,700
Personal Products – 1.1%
The Estee Lauder Cos., Inc., Class A	13,150	933,124
Pharmaceuticals – 2.1%
Bristol-Myers Squibb Co.	15,400	808,808
Zoetis, Inc.	34,000	1,076,440
		1,885,248
Real Estate Investment Trusts (REITs) – 1.5%
American Tower Corp.	16,700	1,325,145
Road & Rail – 4.1%
The Kansas City Southern Railway Co.	3,600	437,472
Union Pacific Corp.	21,150	3,202,110
		3,639,582

50       HSBC PORTFOLIOS See notes to financial statements.

HSBC GROWTH PORTFOLIO

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

Common Stocks, continued
	Shares	Value ($)
Semiconductors & Semiconductor Equipment – 3.0%
Applied Materials, Inc.	47,800	853,230
ARM Holdings plc ADR	20,100	948,519
NXP Semiconductors NV (a)	21,250	895,050
		2,696,799
Software – 3.4%
Salesforce.com, Inc. (a)	47,150	2,515,924
ServiceNow, Inc. (a)	8,700	475,107
		2,991,031
Specialty Retail – 5.9%
Best Buy Co., Inc.	7,350	314,580
Dollar General Corp. (a)	22,300	1,288,494
Lowe’s Cos., Inc	22,300	1,110,094
Ross Stores, Inc.	12,600	974,610
Ulta Salon, Cosmetics & Fragrance,
Inc. (a)	11,700	1,507,545
		5,195,323
Textiles, Apparel & Luxury Goods – 3.1%
Lululemon Athletica, Inc. (a)	8,500	586,925
NIKE, Inc., Class B	18,300	1,386,408
Ralph Lauren Corp.	4,900	811,636
		2,784,969
Trading Companies & Distributors – 1.0%
W. W. Grainger, Inc.	3,365	905,084
Wireless Telecommunication Services – 1.4%
SBA Communications Corp.,
Class A(a)	14,250	1,246,448
TOTAL COMMON STOCKS
(COST $62,689,144)		87,746,575
Investment Companies – 0.7%
Northern Institutional Diversified Assets
Portfolio, Institutional Shares,
0.01% (b)	606,946	606,946
TOTAL INVESTMENT COMPANIES
(COST $606,946)		606,946
TOTAL INVESTMENT SECURITIES
(COST $63,296,090) — 99.6%		88,353,521

___________________

Percentages indicated are based on net assets of $88,684,466.

(a)	Represents non-income producing security.
(b)	The rate represents the annualized one-day yield that was in effect on October 31, 2013.

ADR American Depositary Receipt

See notes to financial statements. HSBC PORTFOLIOS        51

HSBC OPPORTUNITY PORTFOLIO

Schedule of Portfolio Investments—as of October 31, 2013

Common Stocks – 96.4%
	Shares	Value ($)
Aerospace & Defense – 3.1%
BE Aerospace, Inc. (a)	46,990	3,813,708
TransDigm Group, Inc.	22,385	3,255,003
		7,068,711
Auto Components – 1.5%
Gentex Corp.	114,150	3,360,576
Biotechnology – 4.9%
ACADIA Pharmaceuticals, Inc. (a)	102,800	2,336,644
Alkermes plc (a)	124,810	4,392,064
Cubist Pharmaceuticals, Inc. (a)	72,520	4,496,240
		11,224,948
Capital Markets – 1.6%
Raymond James Financial, Inc.	77,760	3,549,744
Chemicals – 6.2%
Celanese Corp., Series A	19,010	1,064,750
Cytec Industries, Inc.	35,570	2,955,511
Huntsman Corp.	153,470	3,563,573
Rockwood Holdings, Inc.	42,700	2,700,775
The Scotts Mircale-Gro Co.	63,830	3,748,098
		14,032,707
Commercial Banks – 2.8%
Comerica, Inc.	59,470	2,575,051
First Republic Bank	74,640	3,811,865
		6,386,916
Commercial Services & Supplies – 1.6%
Waste Connections, Inc.	83,135	3,553,190
Communications Equipment – 0.7%
JDS Uniphase Corp. (a)	118,500	1,551,165
Construction Materials – 0.7%
Martin Marietta Materials, Inc.	17,245	1,691,562
Containers & Packaging – 2.7%
Crown Holdings, Inc. (a)	48,790	2,127,244
Packaging Corp. of America	65,400	4,073,112
		6,200,356
Distributors – 1.1%
LKQ Corp. (a)	78,070	2,578,652
Diversified Consumer Services – 1.5%
Service Corp. International	188,540	3,395,605
Electrical Equipment – 2.7%
Generac Holdings, Inc.	43,690	2,156,102
Hubbell, Inc., Class B	36,500	3,925,210
		6,081,312
Electronic Equipment, Instruments & Components – 0.6%
IPG Photonics Corp.	19,110	1,266,420
Energy Equipment & Services – 1.9%
Rowan Cos. plc, Class A(a)	116,860	4,216,309
Health Care Equipment & Supplies – 3.7%
ArthroCare Corp. (a)	61,740	2,311,546
IDEXX Laboratories, Inc. (a)	30,700	3,311,302
Wright Medical Group, Inc. (a)	99,300	2,697,981
		8,320,829
Health Care Providers & Services – 1.9%
Community Health Systems, Inc.	96,490	4,209,859
Health Care Technology – 0.8%
Allscripts Healthcare Solutions, Inc. (a)	134,470	1,859,720
Hotels, Restaurants & Leisure – 1.8%
Arcos Dorados Holdings, Inc., Class A	113,250	1,363,530
Brinker International, Inc.	63,240	2,809,121
		4,172,651
Household Durables – 5.4%
Harman International Industries, Inc.	29,540	2,393,331
Jarden Corp. (a)	70,115	3,881,566
NVR, Inc. (a)	2,427	2,226,336
Taylor Morrison Home Corp., Class A(a)	95,750	2,129,480
Tempur Sealy International, Inc. (a)	44,480	1,705,808
		12,336,521
Insurance – 1.9%
Everest Re Group Ltd.	10,390	1,597,358
Genworth Financial, Inc., Class A(a)	194,860	2,831,316
		4,428,674
Internet Software & Services – 2.6%
MercadoLibre, Inc.	24,020	3,233,933
Pandora Media, Inc. (a)	105,680	2,655,738
		5,889,671
IT Services – 6.9%
Alliance Data Systems Corp. (a)	29,245	6,932,820
FleetCor Technologies, Inc. (a)	29,575	3,411,476
Genpact Ltd. (a)	111,310	2,207,277
Total System Services, Inc.	100,930	3,010,742
		15,562,315
Life Sciences Tools & Services – 3.3%
Covance, Inc. (a)	35,000	3,124,100
Mettler-Toledo International, Inc. (a)	18,120	4,483,975
		7,608,075
Machinery – 2.1%
Lincoln Electric Holdings, Inc.	34,780	2,408,167
The Timken Co.	44,450	2,347,405
		4,755,572
Media – 1.6%
Manchester United plc, Class A(a)	84,360	1,375,068
Nexstar Broadcasting Group, Inc.,
Class A	51,270	2,275,875
		3,650,943

52       HSBC PORTFOLIOS See notes to financial statements.

HSBC OPPORTUNITY PORTFOLIO

Schedule of Portfolio Investments—as of October 31, 2013 (continued)

Common Stocks, continued
	Shares	Value ($)
Oil, Gas & Consumable Fuels – 5.0%
CONSOL Energy, Inc.	72,100	2,631,650
Denbury Resources, Inc. (a)	140,980	2,677,210
Tesoro Corp.	124,510	6,087,294
		11,396,154
Pharmaceuticals – 2.7%
ViroPharma, Inc. (a)	157,970	6,132,395
Professional Services – 2.0%
IHS, Inc., Class A(a)	22,515	2,455,261
Robert Half International, Inc.	56,730	2,185,807
		4,641,068
Real Estate Investment Trusts (REITs) – 1.1%
Starwood Property Trust, Inc.	96,270	2,473,176
Real Estate Management & Development – 1.1%
Jones Lang LaSalle, Inc.	25,440	2,421,888
Road & Rail – 1.3%
Landstar System, Inc.	52,290	2,891,114
Semiconductors & Semiconductor Equipment – 3.0%
Avago Technologies Ltd.	37,670	1,711,348
NXP Semiconductors NV (a)	80,230	3,379,288
Skyworks Solutions, Inc. (a)	66,800	1,722,104
		6,812,740
Software – 3.2%
Concur Technologies, Inc. (a)	21,270	2,224,842
Informatica Corp. (a)	58,240	2,248,064
QLIK Technologies, Inc. (a)	108,820	2,757,499
		7,230,405
Specialty Retail – 8.1%
Best Buy Co., Inc.	118,510	5,072,228
GNC Holdings, Inc., Class A	30,610	1,800,480
Signet Jewelers Ltd.	45,130	3,369,406
Tractor Supply Co.	35,170	2,509,380
Urban Outfitters, Inc. (a)	93,210	3,530,795
Williams-Sonoma, Inc.	42,094	2,207,409
		18,489,698
Trading Companies & Distributors – 3.3%
United Rentals, Inc. (a)	47,670	3,079,005
WESCO International, Inc. (a)	52,080	4,450,757
		7,529,762
TOTAL COMMON STOCKS
(COST $167,155,410)		218,971,403
Investment Companies – 2.9%
Northern Institutional Government
Select Portfolio, Institutional Shares,
0.01% (b)	6,563,134	6,563,134
TOTAL INVESTMENT COMPANIES
(COST $6,563,134)		6,563,134
TOTAL INVESTMENT SECURITIES
(COST $173,718,544) — 99.3%		225,534,537

____________________

Percentages indicated are based on net assets of $227,068,664.

(a)	Represents non-income producing security.
(b)	The rate represents the annualized one-day yield that was in effect on October 31, 2013.

See notes to financial statements. HSBC PORTFOLIOS        53

HSBC PORTFOLIOS

Statements of Assets and Liabilities—as of October 31, 2013

	Growth		Opportunity
	Portfolio		Portfolio
Assets:
Investments in non-affiliates, at value	$	88,353,521	$	225,534,537
Dividends receivable		19,861		32,244
Receivable for investments sold		1,517,261		2,269,970
Prepaid expenses		594		1,339
Total Assets		89,891,237		227,838,090
Liabilities:
Payable for investments purchased		1,134,982		584,366
Accrued expenses and other liabilities:
Investment Management		49,082		150,660
Administration		2,318		5,839
Compliance Services		8		27
Accounting		212		223
Custodian		5,200		6,773
Trustee		83		346
Other		14,886		21,192
Total Liabilities		1,206,771		769,426
Applicable to investors’ beneficial interest	$	88,684,466	$	227,068,664
Total Investments, at cost	$	63,296,090	$	173,718,544

54       HSBC PORTFOLIOS See notes to financial statements.

HSBC PORTFOLIOS

Statements of Operations—For the year ended October 31, 2013

	Growth			Opportunity
	Portfolio			Portfolio
Investment Income:
Dividends		$	975,963		$	1,973,053
Total Investment Income			975,963			1,973,053
Expenses:
Investment Management			472,689			1,486,877
Administration			26,895			58,975
Accounting			44,063			44,249
Compliance Services			719			1,518
Custodian			9,900			13,555
Printing			1,791			4,180
Professional			20,043			25,426
Trustee			2,176			4,700
Other			4,584			9,513
Total Expenses			582,860			1,648,993
Net Investment Income (Loss)			393,103			324,060
Net Realized/Unrealized Gains (Losses) from Investments:
Net realized gains (losses) from investment securities			12,024,769			24,604,589
Change in unrealized appreciation/depreciation on investments			11,744,016			30,628,121
Net realized/unrealized gains (losses) from investments			23,768,785			55,232,710
Change In Net Assets Resulting From Operations		$	24,161,888		$	55,556,770

See notes to financial statements. HSBC PORTFOLIOS        55

HSBC PORTFOLIOS

Statements of Changes in Net Assets

	Growth								Opportunity
	Portfolio								Portfolio
	For the				For the				For the				For the
	year ended				year ended				year ended				year ended
	October 31, 2013				October 31, 2012				October 31, 2013				October 31, 2012
Investment Activities:
Operations:
Net investment income (loss)		$	393,103			$	116,496			$	324,060			$	224,890
Net realized gains (losses) from investments			12,024,769				12,654,581				24,604,589				8,826,465
Change in unrealized appreciation/depreciation
from investments			11,744,016				(6,525,872	)			30,628,121				8,291,618
Change in net assets resulting from operations			24,161,888				6,245,205				55,556,770				17,342,973
Proceeds from contributions			5,010,619				10,142,030				37,719,433				15,884,698
Value of withdrawals			(19,506,375	)			(42,657,788	)			(16,266,064	)			(24,493,548	)
Change in net assets resulting from transactions
in investors’ beneficial interest			(14,495,756	)			(32,515,758	)			21,453,369				(8,608,850	)
Change in net assets			9,666,132				(26,270,553	)			77,010,139				8,734,123
Net Assets:
Beginning of period			79,018,334				105,288,887				150,058,525				141,324,402
End of period		$	88,684,466			$	79,018,334			$	227,068,664			$	150,058,525

56       HSBC PORTFOLIOS See notes to financial statements.

HSBC PORTFOLIOS

Financial Highlights

Selected data for a share outstandingthroughout the periodsindicated.

				Ratios/Supplementary Data
													Ratios of
										Ratio of Net			Expenses
							Ratio of Net			Investment			to Average
				Net Assets at			Expenses to			Income (Loss)			Net Assets
	Total			End of Period			Average Net			to Average Net			(Excluding Fee	Portfolio
	Return			(000’s)			Assets			Assets			Reductions)	Turnover
GROWTH PORTFOLIO
Year Ended October 31, 2009		19.31	%		$	88,163		0.69	%		0.17	%	0.69%		66	%
Year Ended October 31, 2010		20.34	%		$	98,751		0.68	%		(0.04	)%	0.68%		89	%
Year Ended October 31, 2011		11.07	%		$	105,289		0.66	%		0.07	%	0.66%		56	%
Year Ended October 31, 2012		7.18	%		$	79,018		0.71	%		0.13	%	0.71%		53	%
Year Ended October 31, 2013		32.84	%		$	88,684		0.69	%		0.46	%	0.69%		75	%
OPPORTUNITY PORTFOLIO
Year Ended October 31, 2009		15.41	%		$	129,748		0.90	%		(0.37	)%	0.90%		65	%
Year Ended October 31, 2010		28.74	%		$	139,402		0.89	%		(0.35	)%	0.89%		68	%
Year Ended October 31, 2011		12.40	%		$	141,324		0.88	%		0.05	%	0.88%		69	%
Year Ended October 31, 2012		12.71	%		$	150,059		0.91	%		0.15	%	0.91%		59	%
Year Ended October 31, 2013		34.84	%		$	227,069		0.89	%		0.17	%	0.89%		70	%

See notes to financial statements. HSBC PORTFOLIOS        57

HSBC PORTFOLIOS

Notes to Financial Statements—as of October 31, 2013

1. Organization:

     The HSBC Portfolios (the “Portfolio Trust”), is an open-end management investment company organized as a New York trust under the laws of the State of New York on November 1, 1994. The Portfolio Trust contains the following master funds (individually a “Portfolio,” collectively the “Portfolios”):

Portfolio	Short Name
HSBC Growth Portfolio	Growth Portfolio
HSBC Opportunity Portfolio	Opportunity Portfolio

The Portfolios operate as master funds in master-feeder arrangements, in which other funds invest all or part of their investable assets in the Portfolios. The Portfolios also receive investments from funds of funds. The Declaration of Trust permits the Board of Trustees (the “Board”) to issue an unlimited number of beneficial interests in the Portfolios.

The Portfolios are diversified series of the Portfolio Trust and are part of the HSBC Family of Funds, which also includes the HSBC Advisor Funds Trust and HSBC Funds (collectively, the “Trusts”). Financial statements for all other funds of the Trusts are published separately.

Under the Portfolio Trust’s organizational documents, the Portfolio Trust’s officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Portfolios. In addition, in the normal course of business, the Portfolio Trust enters into contracts with its service providers, which also provide for indemnifications by the Portfolios. The Portfolios’ maximum exposure under these arrangements is unknown as this would involve any future claims that may be made against the Portfolios. However, based on experience, the Portfolio Trust expects that risk of loss to be remote.

2. Significant Accounting Policies:

The following is a summary of the significant accounting policies followed by the Portfolios in the preparation of their financial statements. The policies are in conformity with U.S. generally accepted accounting principles (“GAAP”). The preparation of financial statements requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

Securities Valuation:

The Portfolios record their investments at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The valuation techniques used to determine fair value are further described in Note 3 below.

Investment Transactions and Related Income:

Investment transactions are accounted for no later than one business day after trade date. However, for financial reporting purposes, investment transactions are accounted for on trade date. Investment gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date.

Expense Allocations:

Expenses directly attributable to a Portfolio are charged to that Portfolio. Expenses not directly attributable to a Portfolio are allocated proportionally among the applicable portfolios or funds within the Trusts in relation to net assets or on another reasonable basis.

58       HSBC PORTFOLIOS

HSBC PORTFOLIOS

Notes to Financial Statements — as of October 31, 2013 (continued)

Federal Income Taxes:

     Each Portfolio will be treated as a partnership for U.S. federal income tax purposes. Accordingly, each Portfolio passes through all of its net investment income and gains and losses to its feeder funds, and is therefore not subject to U.S. federal income tax. As such, investors in the Portfolios will be taxed on their respective share of the Portfolios’ ordinary income and realized gains. It is intended that the Portfolios will be managed in such a way that an investor will be able to satisfy the requirements of the Internal Revenue Code, as amended, applicable to regulated investment companies.

Management of the Portfolios has reviewed tax positions taken in tax years that remain subject to examination by all major tax jurisdictions, including federal (i.e., the last four tax year ends and the interim tax period since then, as applicable). Management believes that there is no tax liability resulting from unrecognized tax benefits related to uncertain tax positions taken.

New Accounting Pronouncements:

In January 2013, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2013-01 “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities” (“ASU 2013-01”) which amended Accounting Standards Codification Subtopic 210-20, Balance Sheet Offsetting. ASU 2013-01 clarified the scope of ASU No. 2011-11 “Disclosures about Offsetting Assets and Liabilities” (“ASU 2011-11”). ASU 2011-11 requires an entity to disclose information about offsetting and related arrangements to enable users of the financial statements to understand the effect of those arrangements on the entity’s financial position. ASU 2013-01 clarifies the scope of ASU 2011-11 as applying to derivatives accounted for in accordance with Topic 815, Derivatives and Hedging, including bifurcated embedded derivatives, repurchase agreements and reverse repurchase agreements, and securities borrowing and securities lending transactions that are offset either in accordance with other requirements of GAAP or subject to an enforceable master netting arrangement or similar agreement. The guidance in ASU 2013-01 and ASU 2011-11 is effective for interim and annual periods beginning on or after January 1, 2013. Management is evaluating any impact ASU 2013-01 and ASU 2011-11 may have on the Portfolios’ financial statements.

3. Investment Valuation Summary:

The valuation techniques employed by the Portfolios, as described below, maximize the use of observable inputs and minimize the use of unobservable inputs in determining fair value. The inputs used for valuing the Portfolios’ investments are summarized in the three broad levels listed below:

• Level 1: quoted prices in active markets for identical assets
   
• Level 2: other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.)
   
• Level 3: significant unobservable inputs (including a Portfolio’s own assumptions in determining the fair value of investments)

Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The Portfolios determine transfers between fair value hierarchy levels at the reporting period end. The inputs or methodology used for valuing investments are not necessarily an indication of the risk associated with investing in those investments.

Exchange traded, domestic equity securities are valued at the last sale price on a national securities exchange, or in the absence of recorded sales, at the readily available closing bid price on such exchanges, or at the quoted bid price in the over-the-counter market and are typically categorized as Level 1 in the fair value hierarchy.

Shares of exchange traded and closed-end registered investment companies are valued in the same manner as other equity securities and are typically categorized as Level 1 in the fair value hierarchy. Mutual funds are valued at their net asset values, as reported by such companies and are typically categorized as Level 1 in the fair value hierarchy.

HSBC PORTFOLIOS       59

HSBC PORTFOLIOS

Notes to Financial Statements — as of October 31, 2013 (continued)

     Repurchase agreements are valued at original cost and are typically categorized as Level 2 in the fair value hierarchy.

Securities or other assets for which market quotations are not readily available, or are deemed unreliable due to a significant event or otherwise, are valued pursuant to procedures adopted by the Trusts’ Board (“Procedures”). Depending on the source and relative significance of valuation inputs, these instruments may be classified as Level 2 or Level 3 in the fair value hierarchy. Examples of potentially significant events that could affect the value of an individual security and thus require pricing under the Procedures include corporate actions by the issuer, announcements by the issuer relating to its earnings or products, regulatory news, natural disasters, and litigation. Examples of potentially significant events that could affect multiple securities held by a Portfolio include governmental actions, natural disasters, and armed conflicts. Fair value pricing may require subjective determinations about the value of a security. While the Portfolio Trust’s policy is intended to result in a calculation of a Portfolio’s net asset value that fairly reflects security values as of the time of pricing, the Portfolio Trust cannot ensure that fair values determined would accurately reflect the price that a Portfolio could obtain for a security if it were to dispose of that security as of the time of pricing. The prices used by a Portfolio may differ from the value that would be realized if the securities were sold and the differences could be material to the financial statements.

For the year ended October 31, 2013, there were no Level 3 investments for which significant unobservable inputs were used to determine fair value.

The following is a summary of the valuation inputs used as of October 31, 2013 in valuing the Portfolios’ investments based upon the three levels defined above. The breakdown of investment categorization is disclosed in the Schedule of Portfolio Investments for each Portfolio:

	LEVEL 1 ($)	LEVEL 2 ($)	LEVEL 3 ($)	Total ($)
Growth Portfolio
Investment Securities:
Common Stocks	87,746,575	—	—	87,746,575
Investment Companies	606,946	—	—	606,946
Total Investment Securities	88,353,521	—	—	88,353,521
Opportunity Portfolio
Investment Securities:
Common Stocks	218,971,403	—	—	218,971,403
Investment Companies	6,563,134	—	—	6,563,134
Total Investment Securities	225,534,537	—	—	225,534,537

4. Related Party Transactions and Other Agreements:

Investment Management:

     HSBC Global Asset Management (USA) Inc. (“HSBC” or the “Investment Adviser”), a wholly owned subsidiary of HSBC Bank USA, N.A., a national bank organized under the laws of the United States, acts as the Investment Adviser to the Portfolios pursuant to an investment management contract with the Portfolio Trust. As Investment Adviser, HSBC manages the investments of the Portfolios and continuously reviews, supervises, and administers the Portfolios’ investments. Winslow Capital Management, Inc. (“Winslow”) and Westfield Capital Management Company, L.P. (“Westfield”) serve as subadvisers for the Growth Portfolio and Opportunity Portfolio, respectively, and are paid for their services directly by the respective Portfolios.

60       HSBC PORTFOLIOS

HSBC PORTFOLIOS

Notes to Financial Statements — as of October 31, 2013 (continued)

     For their services, the Investment Adviser and Winslow receive in aggregate, from the Growth Portfolio, a fee, accrued daily and paid monthly, at an annual rate of:

Based on Average Daily Net Assets of all Sub-Adviser serviced funds and separate accounts affiliated
with HSBC:	Fee Rate(%)*
Up to $250 million	0.575
In excess of $250 million but not exceeding $500 million	0.525
In excess of $500 million but not exceeding $750 million	0.475
In excess of $750 million but not exceeding $1 billion	0.425
In excess of $1 billion	0.375

____________________
 

* The Growth Portfolio may pay the Investment Adviser and Winslow an aggregate maximum fee of up to 0.68%. Currently, the Investment Adviser’s contractual fee is 0.175% and Winslow’s maximum contractual fee is 0.40%. Accordingly, the current aggregate maximum fee rate is 0.575%.

     For their services, the Investment Adviser and Westfield receive in aggregate, a fee, accrued daily and paid monthly, at an annual rate of 0.80% of the Opportunity Portfolio’s average daily net assets.

Administration:

HSBC serves the Portfolios as Administrator. Under the terms of the Administration Agreement, HSBC receives from the Portfolios (as well as other funds in the Trusts combined) a fee, accrued daily and paid monthly at an annual rate of:

Based on Combined Average Daily Net Assets of	Fee Rate(%)
Up to $10 billion	0.0550
In excess of $10 billion but not exceeding $20 billion	0.0350
In excess of $20 billion but not exceeding $50 billion	0.0275
In excess of $50 billion	0.0250

The fee rates and breakpoints are determined on the basis of the aggregate average daily net assets of the Trusts, however, the assets of the funds of the HSBC Funds and HSBC Advisor Funds Trust that invest in the Portfolios are not double-counted. The total administration fee paid to HSBC is allocated to each series based upon its proportionate share of the aggregate net assets of the Trusts. For assets invested in the Portfolios by the funds of the HSBC Funds and HSBC Advisor Funds Trust, the Portfolios pay half of the administration fee and the other funds pay half of the administration fee, for a combination of the total fee rate set forth above.

Pursuant to a Sub-Administration Agreement with HSBC, Citi Fund Services Ohio, Inc. (“Citi”), a wholly-owned subsidiary of Citigroup, Inc., serves as the Trusts’ Sub-Administrator subject to the general supervision by the Trusts’ Board and HSBC. For these services, Citi is entitled to a fee, payable by HSBC, at an annual rate equivalent to the fee rates set forth above subject to certain reductions associated with services provided to new portfolios, minus 0.02% which is retained by HSBC.

Under a Compliance Services Agreement between the Trusts and Citi (the “CCO Agreement”), Citi makes an employee available to serve as the Trusts’ Chief Compliance Officer (the “CCO”). Under the CCO Agreement, Citi also provides infrastructure and support in implementing the written policies and procedures comprising the Trusts’ compliance program, including support services to the CCO. For the services provided under the CCO Agreement, the Trusts paid Citi $287,560 for the year ended October 31, 2013, plus reimbursement of certain out of pocket expenses. Expenses incurred by each Portfolio are reflected on the Statements of Operations as “Compliance Services.” Citi pays the salary and other compensation earned by individuals performing these services, as employees of Citi.

Fund Accounting:

Citi provides fund accounting services for the Portfolio Trust. For its services to the Portfolios, Citi receives an annual fee per portfolio, including reimbursement of certain expenses, that is accrued daily and paid monthly.

HSBC PORTFOLIOS       61

HSBC PORTFOLIOS

Notes to Financial Statements — as of October 31, 2013 (continued)

Independent Trustees:

     The Trusts pay each Independent Trustee an annual retainer of $100,000. The Trusts pay a fee of $10,000 for each regular meeting of the Board attended and a fee of $ 3,000 for each special meeting attended. The Trusts pay each Committee Chair an annual retainer of $ 3,000, with the exception of the Chair of the Audit Committee, who receives a retainer of $ 6,000. The Trusts also pay the Chairman of the Boardan additional annual retainer of $24,000. In addition, for time expended on Board duties outside normal meetings, which is authorized by the Board, a Trustee is compensated at the rate of $ 500 per hour, up to a maximum of $ 3,000 per day.

5. Investment Transactions:

Cost of purchases and proceeds from sales of securities (excluding securities maturing less than one year from acquisition) for the year ended October 31, 2013 were as follow:

	Purchases ($)		Sales ($)
Growth Portfolio		62,055,996		74,114,396
Opportunity Portfolio		144,039,393		126,127,698

For the year ended October 31, 2013, there were no long-term U.S. government securities held by the Portfolio Trust.

6. Federal Income Tax Information:

At October 31, 2013, the cost basis of securities for federal income tax purposes, gross unrealized appreciation, gross unrealized depreciation and net unrealized appreciation/depreciation were as follows:

							Net Unrealized
			Tax Unrealized	Tax Unrealized			Appreciation/
	Tax Cost ($)		Appreciation ($)	Depreciation ($)			(Depreciation) ($)*
Growth Portfolio		59,903,953	28,711,719		(262,151	)	28,449,568
Opportunity Portfolio		174,027,654	53,521,776		(2,014,893	)	51,506,883

____________________
 

* The difference between book-basis unrealized appreciation (depreciation) is attributable primarily to tax deferral of losses on wash sales.

7. Subsequent Events:

Management has evaluated events and transactions through the date the financial statements were issued, for purposes of recognition or disclosure in these financial statements and there are no subsequent events to report.

62       HSBC PORTFOLIOS

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Trustees of
HSBC Portfolios:

We have audited the accompanying statements of assets and liabilities of HSBC Portfolios – HSBC Growth Portfolio and HSBC Opportunity Portfolio (the Funds), including the schedules of portfolio investments, as of October 31, 2013, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period then ended. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the auditto obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of October 31, 2013, by correspondence with custodians and brokers or by other appropriate auditing procedures. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Funds as of October 31, 2013, the results of their operations for the year then ended, the changes in their net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period then ended, in conformity with U.S. generally accepted accounting principles.

Columbus, Ohio
December 27, 2013

HSBC PORTFOLIOS       63

HSBC PORTFOLIOS

Table of Shareholder Expenses — as of October 31, 2013 (continued)

     As a shareholder of the Portfolios, you incur ongoing costs, including management fees and other Fund expenses.

These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Portfolios and to compare these costs with the ongoing costs of investing in other mutual funds.

These examples are based on an investment of $1,000 invested at the beginning of the period and held for the entire period from May 1, 2013 through October 31, 2013.

Actual Example

The table below provides information about actual account values and actual expenses. You may use the information below, 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 table under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

							Annualized
	Beginning		Ending		Expenses Paid		Expense Ratio
	Account Value		Account Value		During Period*		During Period
	5/1/13		10/31/13		5/1/13 - 10/31/13		5/1/13 - 10/31/13
Growth Portfolio		$1,000.00		$1,170.40		$3.61	0.66%
Opportunity Portfolio		1,000.00		1,139.50		4.75	0.88%

Hypothetical Example for Comparison Purposes

     The table below provides information about hypothetical account values and hypothetical expenses based on each Portfolio’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Portfolio’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 this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

							Annualized
	Beginning		Ending		Expenses Paid		Expense Ratio
	Account Value		Account Value		During Period*		During Period
	5/1/13		10/31/13		5/1/13 - 10/31/13		5/1/13 - 10/31/13
Growth Portfolio		$1,000.00		$1,021.88		$3.36	0.66%
Opportunity Portfolio		1,000.00		1,020.77		4.48	0.88%

____________________
 

* Expenses are equal to the average account value over the period, multiplied by the Portfolio's annualized expense ratio, multiplied by 184/365 (to reflect the one half year period).

64       HSBC PORTFOLIOS

HSBC PORTFOLIOS

Board of Trustees and Officers (Unaudited)

MANAGEMENT OF THE TRUST

     The following table contains information regarding the HSBC Family of Funds’ Board of Trustees (“Trustees”). Asterisks indicate those Trustees who are “interested persons,” as defined in the Investment Company Act of 1940, as amended, of the HSBC Family of Funds. The HSBC Family of Funds’ Statement of Additional Information includes additional information about the Trustees and is available, without charge, upon request by calling (888) 525-5757.

				Portfolios in
	Position(s)	Term of Office		Fund Complex	Other
Name,	Held with	and Length of	Principal Occupation(s)	Overseen By	Directorships
Address, Age	Funds	Time Served	During Past 5 Years	Trustee*	Held by Trustee
NON-INTERESTED
TRUSTEES
MARCIA L. BECK P.O. Box 182845 Columbus, OH 43218-3035 Age: 58	Trustee	Indefinite; 2008 to present	Private Investor (June 1999 – present); Executive Vice President, Prudential Investments (1997 – 1999); President and Trustee, The Goldman Sachs Mutual Funds (1992 – 1996)	21	None
SUSAN C. GAUSE P.O. Box 182845 Columbus, OH 43218-3035 Age: 60	Trustee	Indefinite; 2013 to present	Since 2003, Private Investor; Independent Trustee of Met Investors Series Trust (2008-2012); Chief Executive Officer, Dresdner RCM Global Investors and Allianz Dresdner Asset Management (2000-2002); Board Member of Dresdner Global Asset Management Board (2000-2002); Chief Operating Officer and Senior Managing Director of Dresdner RCM Global Investors (1998-2000)	21	Since 2012, Trustee, Metropolitan Series Fund
SUSAN S. HUANG P.O. Box 182845 Columbus, OH 43218-3035 Age: 59	Trustee	Indefinite; 2008 to present	Private Investor (2000-present); Senior Vice President, Schroder Investment Management (2001 – 2004); Managing Director, Chase Asset Management (1995-2000)	21	None
ALAN S. PARSOW P.O. Box 182845 Columbus, OH 43218-3035 Age: 63	Trustee	Indefinite; 1987 to present	General Partner, Elkhorn Partners, L.P. (a private investment partnership) (1989 – present)	21	None
THOMAS F. ROBARDS P.O. Box 182845 Columbus, OH 43218-3035 Age: 67	Trustee	Indefinite; 2005 to present	Partner, Robards & Co. LLC (investment and advisory services) (2005-present); Chief Financial Officer, American Museum of Natural History (2003-2004); Chief Financial Officer, Datek Online Holdings (2000-2003); Previously EVP and CFO Republic New York Corporation	21	Overseas Shipholding Group (energy transportation); Ellington Financial LLC (NYSE listed financial services) Ellington Residential Mortgage REIT (NYSE listed real estate investment trust)
MICHAEL SEELY P.O. Box 182845 Columbus, OH 43218-3035 Age: 68	Chairman and Trustee	Indefinite; 1987 to present	Private Investor (2003-present); General Partner, Global Multi Manager Partners (1999-2003); President of Investor Access Corporation (1981-2003)	21	None
INTERESTED TRUSTEE
DEBORAH HAZELL 452 Fifth Avenue New York NY 10018 Age: 50	Trustee	Indefinite; 2011 to present	CEO, HSBC Global Asset Management (USA) Inc. (2011-present); President and CEO, Fisher Francis Trees & Watts (“FFTW”) (investment advisor), February 2008-June 2011; Head of Client Service, Business Development and Marketing Group, FFTW (October 1999-February 2008)	21	None

____________________
 

* Includes the Trust, the HSBC Advisor Fund Trust and the HSBC Portfolios.

HSBC PORTFOLIOS       65

HSBC PORTFOLIOS

Board of Trustees and Officers (Unaudited) (continued)

	Position(s) Held	Term of Office and	Principal Occupation(s)
Name, Address, Age	with Funds	Length of Time Served	During Past 5 Years
OFFICERS
RICHARD A. FABIETTI 452 Fifth Avenue New York, NY 10018 Age: 55	President	One year; 2004 to present	Senior Vice President, Head of Product Management, HSBC Global Asset Management (USA) Inc. (1998 - present)
STEPHEN SIVILLO 452 Fifth Avenue New York, NY 10018 Age: 42	Vice President	One year; 2010 to present	Vice President of Product Administration, HSBC Global Asset Management (USA) Inc. (2010 - present); Chief Compliance Officer, Managers Funds (2009 – 2010); Director, Mutual Fund Compliance, AllianceBernstein (2007-2009)
TY EDWARDS* 3435 Stelzer Road Columbus, OH 43219-3035 Age: 47	Treasurer	One year; 2010 to present	Senior Vice President, Citi Fund Services (2010–present); Director, Product Management, Columbia Management (2007-2009); Deputy Treasurer, Columbia Funds, (2006-2007)
JENNIFER A. ENGLISH* 100 Summer Street Suite 1500 Boston, MA 02110 Age: 41	Secretary	One year; 2008 to present	Senior Vice President, Regulatory Administration, Citi (2005 - present)
FREDERICK J. SCHMIDT* 1 Rexcorp Plaza Uniondale, NY 11556 Age: 54	Chief Compliance Officer	One year; 2004 to present	Director and Chief Compliance Officer, CCO Services, Citi (2004 - present)

____________________

* Mr. Edwards, Mr. Schmidt, and Ms. English also are officers of other investment companies of which Citi (or an affiliate) is the administrator or sub-administrator.

66       HSBC PORTFOLIOS

     Other Information (Unaudited):

Information regarding how the Funds voted proxies relating to portfolio securities during the most recent 12-month period ended June 30th is available (i) without charge, upon request, by calling 1-800-525-5757 for HSBC Bank USA and HSBC Brokerage (USA) Inc. clients and 1-800-782-8183 for all other shareholders; (ii) on the Funds’ website at www.investorfunds.us.hsbc.com; and (iii) on the Security and Exchange Commission’s (“Commission”) website at http://www.sec.gov.

The Funds file their complete schedules of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Funds’ Forms N-Q are available on the Commission’s website at http://www.sec.gov. The Funds’ Forms N-Q may be reviewed and copied at the Commission’s Public Reference Room in Washington, D.C. and information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. The Funds’ Schedules of Investments will be available no later than 60 days after each period end, without charge, on the Funds’ website at www.investorfunds.us.hsbc.com.

An investment in a Fund is not a deposit of HSBC Bank USA, National Association, and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency.

HSBC PORTFOLIOS       67

HSBC FAMILY OF FUNDS: INVESTMENT ADVISER AND ADMINISTRATOR HSBC Global Asset Management (USA) Inc. 452 Fifth Avenue New York, NY 10018 SUB-ADVISERS HSBC Growth Portfolio Winslow Capital Management, LLC 4720 IDS Tower 80 South Eighth Street Minneapolis, MN 55402 HSBC Opportunity Portfolio Westfield Capital Management Company, L.P. One Financial Center Boston, MA 02111

SHAREHOLDER SERVICING AGENTS For HSBC Bank USA, N.A. and HSBC Securities (USA) Inc. Clients HSBC Bank USA, N.A. 452 Fifth Avenue New York, NY 10018 1-888-525-5757 For All Other Shareholders HSBC Funds P.O. Box 182845 Columbus, OH 43218 1-800-782-8183 TRANSFER AGENT Citi Fund Services 3435 Stelzer Road Columbus, OH 43219 DISTRIBUTOR Foreside Distribution Services, L.P. 690 Taylor Road, Suite 150 Gahanna, OH 43230 CUSTODIAN The Northern Trust Company 50 South LaSalle Street Chicago, IL 60603 INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM KPMG LLP 191 West Nationwide Blvd., Suite 500 Columbus, OH 43215 LEGAL COUNSEL Dechert LLP 1900 K Street, N.W. Washington, D.C. 20006

Investment products:

ARE NOT A BANK DEPOSIT OR OBLIGATION OF THE BANK OR ANY OF ITS AFFILIATES	ARE NOT FDIC INSURED	ARE NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY
ARE NOT GUARANTEED BY THE BANK OR ANY OF ITS AFFILIATES		MAY LOSE VALUE

Investment products are offered by HSBC Securities (USA) Inc. (HSI), member NYSE/FINRA/SIPC. HSI is an affiliate of HSBC Bank USA, N.A. Investment products: Are not a deposit or other obligation of the bank or any of its affiliates; Not FDIC insured or insured by any federal government agency of the United States; Not guaranteed by the bank or any of its affiliates; and are subject to investment risk, including possible loss of principal invested.

HSB-AR-WS-1213 12/13

HSBC Global Asset Management (USA) Inc.

HSBC Funds
Annual Report
October 31, 2013

EQUITY FUNDS	Class A	Class B	Class C	Class I
HSBC Growth Fund	HOTAX	HOTBX	HOTCX	HOTYX
HSBC Opportunity Fund	HSOAX	HOPBX	HOPCX	RESCX

Table of Contents

HSBC Family of Funds
Annual Report - October 31, 2013

Glossary of Terms
President’s Message	4
Commentary From the Investment Manager	5
Portfolio Reviews	6
Portfolio Composition	10
Statements of Assets and Liabilities	11
Statements of Operations	12
Statements of Changes in Net Assets	13
Financial Highlights	17
Notes to Financial Statements	20
Report of Independent Registered Public Accounting Firm	28
Other Federal Income Tax Information	29
Table of Shareholder Expenses	30
HSBC Portfolios
Schedules of Portfolio Investments
HSBC Growth Portfolio	32
HSBC Opportunity Portfolio	34
Statements of Assets and Liabilities	36
Statements of Operations	37
Statements of Changes in Net Assets	38
Financial Highlights	39
Notes to Financial Statements	40
Report of Independent Registered Public Accounting Firm	45
Table of Shareholder Expenses	46
Board of Trustees and Officers	47
Other Information	49

Glossary of Terms

Barclays U.S. Aggregate Bond Index is an unmanaged index generally representative of investment-grade, USD-denominated, fixed-rate debt issues, taxable bond market, including Treasuries, government-related and corporate securities, asset-backed, mortgage-backed and commercial mortgage-backed securities, with maturities of at least one year.

Barclays U.S. Corporate High-Yield Bond Index is an unmanaged index that measures the non-investment grade, USD-denominated, fixed-rate, taxable corporate bond market. Securities are classified as high-yield if the middle rating of Moody’s, Fitch, and S&P is Ba1/BB+/BB+ or below. The index excludes emerging markets debt.

Gross Domestic Product (“GDP”) measures the market value of the goods and services produced by labor and property in the United States.

Lipper Large-Cap Growth Funds Average is an equally weighted average of mutual funds that, by portfolio practice, invest at least 75% of their equity assets in companies with market capitalizations (on a three-year weighted basis) above Lipper’s U.S. Diversified Equity large-cap floor. Large-cap growth funds typically have an above-average price-to-earnings ratio, price-to-book ratio, and three-year sales-per-share growth value, compared to the S&P 500 Index.

Lipper Mid-Cap Growth Funds Average is an equally weighted average of mutual funds that, by portfolio practice, invest at least 75% of their equity assets in companies with market capitalizations (on a three-year weighted basis) below Lipper’s U.S. Diversified Equity large-cap floor. Mid-cap growth funds typically have an above-average price-to-earnings ratio, price-to-book ratio, and three-year sales-per-share growth value, compared to the S&P MidCap 400 Index.

Morgan Stanley Capital International Europe Australasia and Far East (“MSCI EAFE”) Index is an unmanaged equity index which captures large and mid cap representation across Developed Markets countries: Australia, Austria, Belgium, Denmark, Finland, France, Germany, Greece, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland and the UK (excluding the US and Canada). With 910 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.

Morgan Stanley Capital International Emerging Market (“MSCI EM”) Index is an unmanaged index that captures large and mid cap representation across 21 Emerging Markets (EM) countries: Brazil, Chile, China, Colombia, Czech Republic, Egypt, Hungary, India, Indonesia, Korea, Malaysia, Mexico, Morocco, Peru, Philippines, Poland, Russia, South Africa, Taiwan, Thailand and Turkey. With 818 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.

Russell 1000^® Growth Index is an unmanaged index that measures the performance of the large-cap growth segment of the U.S. equity universe. It includes those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values.

Russell 2000^® Index is an unmanaged index that measures the performance of the small-cap segment of the U.S. equity universe. The Russell 2000^® Index is a subset of the Russell 3000^® Index representing approximately 10% of the total market capitalization of that index. It includes approximately 2000 of the smallest securities based on a combination of their market cap and current index membership.

Russell 2500™ Growth Index is an unmanaged index that measures the performance of the small- to mid-cap growth segment of the U.S. equity universe. It includes those Russell 2500 companies with higher price-to-book ratios and higher forecasted growth values.

Standard & Poor’s 500 (“S&P 500”) Index is an unmanaged index that is widely regarded as a gauge of the U.S. equities market. This index includes 500 leading companies in leading industries of the U.S. economy. The S&P 500 Index focuses on the large-cap segment of the market, with approximately 75% coverage of U.S. equities.

Lipper is an independent mutual fund performance monitor whose results are based on total return and do not reflect a sales charge.

Securities indices assume reinvestment of all distributions and interest payments and do not take in account brokerage fees or expenses. Securities in the Funds do not match those in the indices and performance of the Funds will differ. Investors cannot invest directly in an index.

President’s Message

Dear Shareholder,

We are pleased to send to you the HSBC Funds annual report, covering the fiscal year ended October 31, 2013. This report contains detailed information about your Funds’ portfolio of investments and operating results. We encourage you to review it carefully.

This report includes commentary from the Funds’ portfolio managers in which they discuss the investment markets and their respective Fund’s performance. The portfolio manager commentary is accompanied by the Fund’s return for the period, listed alongside the returns of its benchmark index and peer group average for comparative purposes.

In closing, we would like to thank you for investing in the HSBC Funds. We continue to focus the HSBC Fund Family on investment solutions to assist our shareholders in reaching their financial goals. We appreciate the trust you place in us, and will continue working to earn it. Please contact us at any time with questions or concerns.

Sincerely,

Richard A. Fabietti
President

4       HSBC FAMILY OF FUNDS

Commentary From the Investment Manager

HSBC Global Asset Management (USA) Inc.

U.S. Economic Review

Economic growth picked up pace in developing economies throughout the world during the 12-month period between November 1, 2012 and October 31, 2013. Many major economies, including the United States, reported improved economic data during the period, indicating new momentum for a modest but sustained recovery. The U.S. equity markets made strong gains during the period, boosted by improvements in the labor and housing markets and healthy corporate profits. Markets continued to benefit from the Federal Reserve Board’s (the “Fed”) decision to maintain the federal funds rate—a key factor in lending rates—at a historically low target range between 0.00% and 0.25%. Economic headwinds remained, however, including relatively high unemployment in some areas, low consumer spending and reduced government spending caused by sequestration.

Investor confidence declined mid-year due in part to expectations that the Fed would begin tapering its bond purchasing program. Concerns about the impact of tapering diminished, however, when the Fed announced in September that it would delay winding down its stimulus efforts until the unemployment rate fell significantly lower. The first shutdown of the U.S. government in 17 years occurred in October. This political crisis, along with the related standoff over raising the country’s borrowing limit, was another factor weighing on investor sentiment. The uncertainty surrounding the crisis dragged on equities, although markets regained momentum once a political deal was struck that reopened the government and raised the debt ceiling. Broad U.S. stock market indices ended the period significantly above where they were positioned 12 months earlier.

Improving political circumstances in the eurozone and positive economic data helped boost stocks in developed economies across the world. The economies of both Japan and Europe transitioned out of recession. Progress was made toward alleviating the sovereign debt crisis in Europe. The European Central Bank’s aggressive efforts, including its government bond-buying program known as Outright Monetary Transactions, reassured investors. Still, many developments in Europe revealed ongoing economic weaknesses, including a controversial bailout in Cyprus, political uncertainty in Italy and high unemployment throughout the eurozone.

Economic growth in many emerging markets slowed during the period, as concerns grew about rising inflation and potential decreases in global liquidity. In addition, signs of softening in China’s economy led to a fall in commodity prices, which dragged on stocks throughout emerging markets. Central banks in both India and Brazil fought rising inflation by raising interest rates.

The recovery of the U.S. housing market remained robust. New home sales and housing starts increased, though the pace of growth slowed late in the period. Although the unemployment rate gradually edged downward, it remained well above pre-recession levels. Moreover, the number of long-term unemployed individuals, including those who dropped out of the labor market entirely, remained high. Real income grew at a modest pace, but consumer spending remained weak, consumer confidence dropped sharply and personal savings rates slowed. Economic activity in the manufacturing sector expanded during the period, though the rate of growth slowed.

U.S. Gross Domestic Product¹ growth increased each quarter during the period, expanding at a rate of 0.1% during the fourth quarter of 2012 and quickening to a rate of 2.8% in the third quarter of 2013, according to preliminary estimates.

Market Review

The period began with U.S. markets retreating slightly due to the political face-off over the “fiscal cliff” and concerns about ongoing turmoil related to eurozone sovereign debt.

Equities then regained momentum in the first quarter of 2013 and began a steady rally that persisted through the duration of the period with only a few brief interruptions. The strong performance of equities was undeterred by uncertainty about government policy and concerns that the onset of automatic budget cuts—known as sequestration—would undermine economic growth. A political compromise that avoided the direst consequences of the fiscal cliff, along with improvement in the housing market, helped buoy investor confidence and fuel gains in the equity markets.

During the middle of the period equity prices fell as investors anticipated an imminent decrease in central bank liquidity. Stocks rebounded after the Fed delayed tapering its bond-purchasing program, with the S&P 500 Index¹ hitting a then-record high following the announcement. Equities ended the period in a rally that was spurred by the political deal that partially resolved the government shutdown and a second standoff over the debt ceiling.

Small- and mid-cap stocks outperformed large-cap stocks during the period, and emerging markets generally underperformed developed economies. The Russell 2000^® Index¹ of small-company stocks returned 36.28% and the MSCI Emerging Market Index¹ of emerging market stocks returned 6.90%.

Stocks in developed economies rose. Japanese equities performed well due to optimism regarding its central bank’s ambitious monetary easing schedule, which aimed to double the size of the monetary base over the next two years. International stocks made strong gains, slightly outperforming U.S. markets. The S&P 500 Index of large-company U.S. stocks returned 27.18% for the 12 months through October 2013. That compared to a 27.40% return for the MSCI EAFE Index¹ of international stocks in developed markets.

Rising interest rates, widening credit spreads and uncertainty about government policy resulted in weak performance in the U.S. fixed-income market during the period. Yields on U.S. Treasury bonds increased during the period, sending prices lower. Investment-grade corporate bonds also declined. Investors sought the more attractive yields offered by high-yield corporate bonds and high-yield municipal bonds, which were among the best-performing fixed-income sectors during the period. The Barclays U.S. Aggregate Bond Index¹, which tracks the broad investment-grade fixed-income market, returned -1.08% for the 12 months through October, while the Barclays U.S. Corporate High-Yield Bond Index¹ returned 8.87%. Fixed-income markets in Europe generated modest returns, while fixed-income in emerging markets ended the period significantly lower, despite a modest rebound in the final months of the period.

1       For additional information, please refer to the Glossary of Terms.

HSBC FAMILY OF FUNDS       5

Portfolio Reviews (Unaudited)

HSBC Growth Fund
(Class A Shares, Class B Shares, Class C Shares and Class I Shares)

by Clark J. Winslow, CEO/Portfolio Manager
Justin H. Kelly, CFA, CIO/Portfolio Manager
Patrick M. Burton, Managing Director/Portfolio Manager
Winslow Capital Management, LLC

The HSBC Growth Fund (the “Fund”) seeks long-term growth of capital. Under normal market conditions, the Fund invests primarily in U.S. and foreign equity securities of high-quality companies with market capitalization generally in excess of $2 billion, which the subadviser believes have the potential to generate superior levels of long-term profitability and growth. The Fund utilizes a two-tier structure, commonly known as a “master-feeder” structure, in which the Fund invests all of its investable assets in the HSBC Growth Portfolio (the “Portfolio”). The Portfolio employs Winslow Capital Management, LLC as its subadviser.

Investment Concerns

Equity securities (stocks) are more volatile and carry more risk than other forms of investments, including investments in high-grade fixed income securities.

The growth investment style may fall out of favor in the marketplace and result in significant declines in the value of the Portfolio’s securities. Securities of companies considered to be growth investments may have rapid price swings in the event of earnings disappointments or during periods of market, political, regulatory and economic uncertainty.

For a complete description of these and other risks associated with investment in a mutual fund, please refer to the Fund’s prospectus.

Market Commentary

The Fund returned 32.17%* (without sales charge) for the Class A Shares and 32.49%* for the Class I Shares for the year ended October 31, 2013. That compared to a 28.30% total return for the Russell 1000^® Growth Index¹, the Fund’s primary performance benchmark, and a 29.24% total return for the Lipper Large-Cap Growth Funds Average¹.

Portfolio Performance

Stocks performed well during the period as investors gained confidence that the U.S. economy was not headed back into recession and that the risk of sovereign default in Portugal, Spain, and Italy was receding. As concerns about systematic risk waned, company fundamentals returned as a main driver of equity prices. Stable, dividend-paying companies that had performed well in the riskier environment appeared relatively overvalued to the Fund’s portfolio managers later in the period. As a result, investors began to favor shares of smaller, growth-oriented companies, which outperformed their larger counterparts during the final four months of the period.

In this environment, the Fund outperformed its Russell benchmark primarily due to stock selection in the consumer discretionary and information technology sectors. For example, an investment in an online travel company that posted strong earnings contributed to the gains in the portfolio’s consumer discretionary holdings. Similarly, a cloud-based relationship company that reported strong earnings boosted performance among the portfolio’s information technology holdings.^†

Moreover, the Fund benefited from moves made during the period to increase holdings of smaller, growth-oriented companies in anticipation of declining systematic risk. Additionally, a long-standing decision to underweight consumer staples boosted the Fund’s performance when the sector suffered as investors shifted away from defensive investments.^†

However, sector-weighting decisions detracted from the Fund’s performance. For instance, an overweight position in the financial sector hurt the Fund when that sector underperformed. Stock selection in the financial and industrial sectors also detracted from the Fund’s returns. For example, legal risks caused an investment in a financial content and analytics provider to underperform, while an investment in a shipping and delivery company underperformed due to slower than anticipated overnight business. Both stocks were sold during the period.^†

*	The recent appreciation in the stock market has helped to produce short-term returns that are not typical and may not continue in the future. Because of ongoing market volatility, fund performance may be subject to substantial short-term changes.
†	Portfolio composition is subject to change.
1	For additional information, please refer to the Glossary of Terms.

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

6       HSBC FAMILY OF FUNDS

	Portfolio Reviews (Unaudited)
HSBC Growth Fund

The charts above represent a historical since inception performance comparison of a hypothetical $10,000 investment in the indicated share class versus a similar investment in the Fund’s benchmark and represents the reinvestment of dividends and capital gains in the Fund.

		Average Annual					Expense
Fund Performance		Total Return (%)					Ratio (%)6
					Since
As of October 31, 2013	Inception Date	1 Year		5 Year	Inception		Gross	Net
HSBC Growth Fund Class A1	5/7/045	25.64	9	16.06	7.87		1.40	1.20
HSBC Growth Fund Class B2	5/7/045	27.16	9	16.36	7.93		2.15	1.95
HSBC Growth Fund Class C3	5/7/045	30.15	9	16.36	7.64		2.15	1.95
HSBC Growth Fund Class I	5/7/045	32.49	9	17.55	8.71		1.15	0.95
Russell 1000® Growth Index4	—	28.30		17.51	7.79	7	N/A	N/A
Lipper Large-Cap Growth Funds Average4	—	29.24		15.72	7.05	8	N/A	N/A

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect the taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower. Currently, contractual fee waivers are in effect for the Fund through March 1, 2014.

Certain returns shown include monies received by the Portfolio, in which the Fund invests, in respect of one-time class action settlements and a one-time reimbursement from HSBC Global Asset Management (USA) Inc. (the “Adviser”) to the Fund related to past marketing arrangements. As a result, the Fund’s total returns for those periods were higher than they would have been had the Portfolio and the Fund not received the payments. Investment in initial public offerings during the current fiscal year ended October 31, 2013 have benefited the Fund’s overall performance by approximately 0.06%. This effect on performance is not typical and may not continue in the future.

1	Reflects the maximum sales charge of 5.00%.
2	Reflects the applicable contingent deferred sales charge, maximum of 4.00%.
3	Reflects the applicable contingent deferred sales charge, maximum of 1.00%.
4	For additional information, please refer to the Glossary of Terms.
5	The HSBC Growth Fund was initially offered for purchase effective May 7, 2004; however, no shareholder activity occurred until May 10, 2004.
6	Reflects the expense ratios as reported in the prospectus dated February 28, 2013. The Adviser has entered into a contractual expense limitation agreement with the Fund under which it will limit total expenses of the Fund (excluding interest, taxes, brokerage commissions, extraordinary expenses and estimated indirect expenses attributable to the Fund’s investments in investment companies) to an annual rate of 1.20%, 1.95%, 1.95% and 0.95% for Class A Shares, Class B Shares, Class C Shares and Class I Shares, respectively. The expense limitation shall be in effect until March 1, 2014. Additional information pertaining to the October 31, 2013 expense ratios can be found in the financial highlights.
7	Return for the period May 10, 2004 to October 31, 2013.
8	Return for the period April 30, 2004 to October 31, 2013.
9	The recent appreciation in the stock market has helped to produce short-term returns that are not typical and may not continue in the future. Because of ongoing market volatility, fund performance may be subject to substantial short-term changes.

The Fund’s performance is measured against the Russell 1000^® Growth Index, an unmanaged index that measures the performance of the large-cap growth segment of the U.S. equity universe. It includes those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values. The performance of the index does not reflect the deduction of expenses associated with a mutual fund, such as investment management and fund accounting fees. The Fund’s performance reflects the deduction of fees for these value-added services. Investors cannot invest directly in an index.

HSBC FAMILY OF FUNDS       7

Portfolio Reviews (Unaudited)

HSBC Opportunity Fund (Advisor)
(Class I Shares)
HSBC Opportunity Fund
(Class A Shares, Class B Shares and Class C Shares)

by William A. Muggia, Committee Lead/Portfolio Manager
Ethan J. Myers, CFA, Portfolio Manager
John M. Montgomery, Portfolio Manager
Hamlen Thompson, Portfolio Manager
Bruce N. Jacobs, CFA, Portfolio Manager
Westfield Capital Management Company, L.P.

The HSBC Opportunity Fund and HSBC Opportunity Fund (Advisor) (collectively the “Fund”) seek long-term growth of capital by investing in equity securities of small- and mid-cap companies. Small- and mid-cap companies generally are defined as those that have market capitalizations within the range of market capitalizations represented in the Russell 2500™ Growth Index. The Fund may also invest in equity securities of larger, more established companies and may invest up to 20% of its assets in securities of foreign companies. The Fund employs a two-tier structure, commonly referred to as a “master-feeder” structure, in which the Fund invests all of its investable assets in the HSBC Opportunity Portfolio (the “Portfolio”). The Portfolio employs Westfield Capital Management Company, L.P. as its subadviser.

Investment Concerns

Equity securities (stocks) are more volatile and carry more risk than other forms of investments, including investments in high-grade fixed income securities.

Small- to mid-capitalization funds typically carry additional risks since smaller companies generally have a higher risk of failure, and historically, their stocks have experienced a greater degree of market volatility than stocks on average.

The growth investment style may fall out of favor in the marketplace and result in significant declines in the value of the Portfolio’s securities. Securities of companies considered to be growth investments may have rapid price swings in the event of earnings disappointments or during periods of market, political, regulatory and economic uncertainty.

There are risks associated with investing in foreign companies, such as erratic market conditions, economic and political instability and fluctuations in currency and exchange rates.

For a complete description of these and other risks associated with investment in a mutual fund, please refer to the Fund’s prospectus.

Market Commentary

For the year ended October 31, 2013, the Class I Shares of the HSBC Opportunity Fund (Advisor) produced a 34.70%* total return, and the Class A Shares of the Fund produced a 34.02%* total return (without sales charge). The Russell 2500^™ Growth Index¹, the Fund’s primary performance benchmark, and the Lipper Mid-Cap Growth Funds Average¹ returned 37.60% and 32.81%, respectively.

Portfolio Performance

U.S. equities continued to post strong returns for the period as investors brushed off concerns about interest rate volatility and worries about a potential U.S. government shutdown. The continuing stimulus efforts by the Federal Reserve, as well as signs of a gradually improving employment picture, helped boost investor confidence during the period. In this environment, small-cap stocks outperformed their large-cap counterparts. The information technology and financial sectors benefited the most from this growing confidence among investors, and were two of the strongest contributors to the Fund’s absolute returns.

The Fund lagged its benchmark for the period. Stock selection in the Fund’s energy holdings was a major detractor. In particular, the Fund was hurt by holdings of an oil field services company that underperformed when it missed analysts’ earnings expectations. The Fund’s sub-sector weighting in consumer discretionary further detracted from relative performance. An overweight position in the apparel retail sub-industry dragged on relative returns, as retailers were hurt by shifting consumer confidence during the period. The Fund was also hurt by underweight positions in Internet retailers and automobile manufacturers, which performed relatively well during the period.^†

However, strong stock selection in the information technology and materials sectors helped offset a portion of the Fund’s underperformance. Shares of a payment processor that consistently exceeded earnings expectations provided the biggest boost to the Fund’s relative performance. In the materials sector, stock selection across multiple subsectors—namely paper packaging, commodity chemicals, and fertilizers and agricultural chemicals—contributed to the Fund’s relative performance. In particular, holdings of a cardboard packaging manufacturer contributed positively as that company executed a strategic acquisition near the end of the period, which helped boost its earnings.^†

Furthermore, holdings of a specialty retail store and consumer electronics retailer helped offset some of the negative effects of sector weighting in the consumer discretionary sector. An underweight position in the gold sub-industry helped to boost the Fund’s relative performance, since gold prices fell, as investors grew more confident in the sustainability of the economic recovery.^†

*	The recent appreciation in the stock market has helped to produce short-term returns that are not typical and may not continue in the future. Because of ongoing market volatility, fund performance may be subject to substantial short-term changes.
†	Portfolio composition is subject to change.
1	For additional information, please refer to the Glossary of Terms.

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

8       HSBC FAMILY OF FUNDS

Portfolio Reviews (Unaudited)

HSBC Opportunity Fund

The charts above represent a historical 10-year performance comparison of a hypothetical $10,000 investment in the indicated share class versus a similar investment in the Fund’s benchmark and represents the reinvestment of dividends and capital gains in the Fund.

			Average Annual			Expense
Fund Performance			Total Return (%)			Ratio (%)5
As of October 31, 2013	Inception Date	1 Year	5 Year	10 Year		Gross	Net
HSBC Opportunity Fund Class A1	9/23/96	27.356	18.54		10.75	2.20	1.65
HSBC Opportunity Fund Class B2	1/6/98	29.106	18.84		10.82	2.95	2.40
HSBC Opportunity Fund Class C3	11/4/98	32.156	18.86		10.51	2.95	2.40
HSBC Opportunity Fund Class I†	9/3/96	34.706	20.36		11.79	1.08	1.08
Russell 2500™ Growth Index4	—	37.60	20.87		9.85	N/A	N/A
Lipper Mid-Cap Growth Funds Average4	—	32.81	18.15		8.69	N/A	N/A

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect the taxes that a shareholder would pay on Fund distributions or on 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 the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.

The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower. Currently, contractual fee waivers are in effect for the Fund through March 1, 2014 for Class A Shares, Class B Shares and Class C Shares.

Certain returns shown include monies received by the Portfolio, in which the Fund invests, in respect of one-time class action settlements and a one-time reimbursement from HSBC Global Asset Management (USA) Inc. (the “Adviser”) to the Fund related to past marketing arrangements. As a result, the Fund’s total returns for those periods were higher than they would have been had the Portfolio and the Fund not received the payments.

†	The Class I Shares are issued by a series of HSBC Advisor Funds Trust, also named the HSBC Opportunity Fund.
1	Reflects the maximum sales charge of 5.00%.
2	Reflects the applicable contingent deferred sales charge, maximum of 4.00%.
3	Reflects the applicable contingent deferred sales charge, maximum of 1.00%.
4	For additional information, please refer to the Glossary of Terms.
5	Reflects the expense ratios as reported in the prospectus dated February 28, 2013. The Adviser has entered into a contractual expense limitation agreement with the Fund under which it will limit total expenses of the Fund (excluding interest, taxes, brokerage commissions, extraordinary expenses and estimated indirect expenses attributable to the Fund’s investments in investment companies other than the Portfolio) to an annual rate of 1.65%, 2.40%, and 2.40% for Class A Shares, Class B Shares, and Class C Shares, respectively. The expense limitation shall be in effect until March 1, 2014. Additional information pertaining to the October 31, 2013 expense ratios can be found in the financial highlights.
6	The recent appreciation in the stock market has helped to produce short-term returns that are not typical and may not continue in the future. Because of ongoing market volatility, fund performance may be subject to substantial short-term changes.

The Fund’s performance is measured against the Russell 2500™ Growth Index, an unmanaged index that measures the performance of the small- to mid-cap growth segment of the U.S. equity universe. It includes those Russell 2500 companies with higher price-to-book ratios and higher forecasted growth values. The performance for the index does not reflect the deduction of expenses associated with a mutual fund, such as investment management and fund accounting fees. The Fund’s performance reflects the deduction of fees for these value-added services. Investors cannot invest directly in an index.

HSBC FAMILY OF FUNDS       9

Portfolio Reviews

Portfolio Composition*

October 31, 2013 (Unaudited)

HSBC Growth Portfolio
	Percentage of
Investment Allocation	Investments at Value (%)
Internet Software & Services	9.4
Biotechnology	9.1
Internet & Catalog Retail	6.8
IT Services	6.4
Specialty Retail	5.9
Media	5.0
Chemicals	4.1
Oil, Gas & Consumable Fuels	4.1
Road & Rail	4.1
Hotels, Restaurants & Leisure	3.8
Capital Markets	3.7
Software	3.4
Aerospace & Defense	3.2
Textiles, Apparel & Luxury Goods	3.2
Computers & Peripherals	3.1
Semiconductors & Semiconductor
Equipment	3.1
Machinery	2.7
Food & Staples Retailing	2.4
Pharmaceuticals	2.1
Health Care Technology	1.7
Communications Equipment	1.5
Real Estate Investment Trusts (REITs)	1.5
Energy Equipment & Services	1.5
Wireless Telecommunication Services	1.4
Diversified Financial Services	1.2
Auto Components	1.2
Personal Products	1.1
Trading Companies & Distributors	1.0
Health Care Providers & Services	0.9
Airlines	0.7
Investment Companies	0.7
	100.0

HSBC Opportunity Portfolio
	Percentage of
Investment Allocation	Investments at Value (%)
Specialty Retail	8.1
IT Services	6.8
Chemicals	6.2
Household Durables	5.5
Oil, Gas & Consumable Fuels	5.1
Biotechnology	5.0
Health Care Equipment & Supplies	3.7
Life Sciences Tools & Services	3.4
Trading Companies & Distributors	3.3
Software	3.2
Aerospace & Defense	3.1
Semiconductors & Semiconductor
Equipment	3.0
Investment Companies	2.9
Commercial Banks	2.8
Containers & Packaging	2.7
Pharmaceuticals	2.7
Electrical Equipment	2.7
Internet Software & Services	2.6
Machinery	2.1
Professional Services	2.1
Insurance	2.0
Energy Equipment & Services	1.9
Health Care Providers & Services	1.9
Hotels, Restaurants & Leisure	1.9
Media	1.6
Commercial Services & Supplies	1.6
Capital Markets	1.6
Diversified Consumer Services	1.5
Auto Components	1.5
Road & Rail	1.3
Distributors	1.1
Real Estate Investment Trusts (REITs)	1.1
Real Estate Management &
Development	1.1
Health Care Technology	0.8
Construction Materials	0.8
Communications Equipment	0.7
Electronic Equipment,
Instruments & Components	0.6
	100.0

____________________

* Portfolio composition is subject to change.

10       HSBC FAMILY OF FUNDS

HSBC FAMILY OF FUNDS

Statements of Assets and Liabilities — as of October 31, 2013

									Opportunity
	Growth				Opportunity				Fund
	Fund				Fund				(Advisor)
Assets:
Investments in Affiliated Portfolios		$	82,541,055			$	15,489,119			$	208,208,427
Receivable for capital shares issued			70,519				4,512				204,270
Receivable from Investment Adviser			—				5,872				—
Prepaid expenses			13,198				5,280				6,891
Total Assets			82,624,772				15,504,783				208,419,588
Liabilities:
Payable for capital shares redeemed			81,215				25,608				46,940
Accrued expenses and other liabilities:
Investment Management			22,883				—				—
Administration			1,730				320				4,306
Distribution			700				760				—
Shareholder Servicing			2,985				6,919				—
Compliance Services			8				1				24
Accounting			—				—				1
Transfer Agent			15,719				8,174				12,353
Trustee			92				21				322
Other			19,910				13,124				34,504
Total Liabilities			145,242				54,927				98,450
Net Assets		$	82,479,530			$	15,449,856			$	208,321,138
Composition of Net Assets:
Capital			47,816,585				10,080,559				139,710,690
Accumulated net investment income (loss)			(99,109	)			2,125				152,233
Accumulated net realized gains (losses) from investments			13,033,403				1,631,777				21,498,432
Unrealized appreciation/depreciation on investments			21,728,651				3,735,395				46,959,783
Net Assets		$	82,479,530			$	15,449,856			$	208,321,138
Net Assets:
Class A Shares		$	12,760,503			$	14,258,647			$	—
Class B Shares			492,917				480,139				—
Class C Shares			602,299				711,070				—
Class I Shares			68,623,811				—				208,321,138
		$	82,479,530			$	15,449,856			$	208,321,138
Shares Outstanding
($0.001 par value, unlimited number of shares authorized):
Class A Shares			587,363				1,115,750				—
Class B Shares			25,459				48,629				—
Class C Shares			30,900				70,141				—
Class I Shares			3,099,018				—				12,062,607
Net Asset Value, Offering Price and Redemption Price per share:
Class A Shares		$	21.73			$	12.78			$	—
Class B Shares(a)		$	19.36			$	9.87			$	—
Class C Shares(a)		$	19.49			$	10.14			$	—
Class I Shares		$	22.14			$	—			$	17.27
Maximum Sales Charge - Class A Shares			5.00	%			5.00	%			—	%
Maximum Offering Price per share
(Net Asset Value/(100%-maximum sales charge)) - Class A Shares		$	22.87			$	13.45			$	—

____________________

(a) Redemption Price per share varies by length of time shares are held.

See notes to financial statements. HSBC FAMILY OF FUNDS        11

HSBC FAMILY OF FUNDS

Statements of Operations — For the year ended October 31, 2013

									Opportunity
	Growth				Opportunity				Fund
	Fund				Fund				(Advisor)
Investment Income:
Investment Income from Affiliated Portfolios		$	877,071			$	138,747			$	1,795,937
Expenses from Affiliated Portfolios			(525,304	)			(115,917	)			(1,500,945	)
Total Investment Income			351,767				22,830				294,992
Expenses:
Administration:
Class A Shares			2,917				2,944				—
Class B Shares			130				119				—
Class C Shares			137				182				—
Class I Shares			15,792				—				42,091
Distribution:
Class B Shares			3,967				3,603				—
Class C Shares			4,117				5,447				—
Shareholder Servicing:
Class A Shares			29,132				28,974				—
Class B Shares			1,323				1,202				—
Class C Shares			1,372				1,808				—
Accounting			23,949				18,950				9,001
Audit			16,973				17,915				17,998
Compliance Services			649				109				1,426
Printing			77				2,382				6,617
Transfer Agent			96,259				50,527				64,598
Trustee			1,958				334				4,273
Registration fees			35,000				15,867				14,920
Other			11,412				4,676				20,266
Total expenses before fee reductions			245,164				155,039				181,190
Fees voluntarily reduced by Investment Adviser			—				(13,058	)			—
Fees contractually reduced by Investment Adviser			(5,267	)			(46,445	)			—
Net Expenses			239,897				95,536				181,190
Net Investment Income (Loss)			111,870				(72,706	)			113,802
Net Realized/Unrealized Gains (Losses) from Investments: (a)
Net realized gains (losses) from investment securities			9,661,220				1,860,103				22,059,925
Change in unrealized appreciation/depreciation on investments			11,851,661				2,027,660				28,194,578
Net realized/unrealized gains (losses) from investments			21,512,881				3,887,763				50,254,503
Change In Net Assets Resulting From Operations		$	21,624,751			$	3,815,057			$	50,368,305

____________________

(a) Represents amounts allocated from the respective Affiliated Portfolios.

12        HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC FAMILY OF FUNDS

Statements of Changes in Net Assets

	Growth Fund								Opportunity Fund
	For the				For the				For the				For the
	year ended				year ended				year ended				year ended
	October 31, 2013				October 31, 2012				October 31, 2013				October 31, 2012
Investment Activities:
Operations:
Net investment income (loss)		$	111,870			$	(133,004	)		$	(72,706	)		$	(67,015	)
Net realized gains (losses) from investments			9,661,220				8,364,394				1,860,103				786,559
Change in unrealized appreciation/depreciation
on investments			11,851,661				(3,332,031	)			2,027,660				610,433
Change in net assets resulting from operations			21,624,751				4,899,359				3,815,057				1,329,977
Dividends:
Net investment income:
Class I Shares			(77,975	)			—				—				—
Net realized gains:
Class A Shares			(789,480	)			—				(613,652	)			(1,598,939	)
Class B Shares			(47,389	)			—				(37,922	)			(93,318	)
Class C Shares			(38,688	)			—				(41,509	)			(76,609	)
Class I Shares			(4,180,730	)			—				—				—
Change in net assets resulting from shareholder dividends			(5,134,262	)			—				(693,083	)			(1,768,866	)
Change in net assets resulting from capital transactions			(4,356,680	)			(8,338,642	)			1,079,236				(429,918	)
Change in net assets			12,133,809				(3,439,283	)			4,201,210				(868,807	)
Net Assets:
Beginning of period			70,345,721				73,785,004				11,248,646				12,117,453
End of period		$	82,479,530			$	70,345,721			$	15,449,856			$	11,248,646
Accumulated net investment income (loss)		$	(99,109	)		$	(133,004	)		$	2,125			$	(49,006	)

See notes to financial statements. HSBC FAMILY OF FUNDS        13

HSBC FAMILY OF FUNDS

Statements of Changes in Net Assets (continued)

	Growth Fund								Opportunity Fund
	For the				For the				For the				For the
	year ended				year ended				year ended				year ended
	October 31, 2013				October 31, 2012				October 31, 2013				October 31, 2012
CAPITAL TRANSACTIONS:
Class A Shares:
Proceeds from shares issued		$	513,267			$	871,476			$	3,386,291			$	772,149
Dividends reinvested			760,894				—				601,275				1,562,653
Value of shares redeemed			(2,349,534	)			(5,909,138	)			(2,790,702	)			(2,900,653	)
Class A Shares capital transactions			(1,075,373	)			(5,037,662	)			1,196,864				(565,851	)
Class B Shares:
Proceeds from shares issued			18,851				111,305				22,345				69,230
Dividends reinvested			47,204				—				37,922				93,292
Value of shares redeemed			(290,302	)			(516,256	)			(182,066	)			(160,269	)
Class B Shares capital transactions			(224,247	)			(404,951	)			(121,799	)			2,253
Class C Shares:
Proceeds from shares issued			51,639				261,486				365,351				112,981
Dividends reinvested			38,495				—				41,448				76,317
Value of shares redeemed			(81,414	)			(42,587	)			(402,628	)			(55,618	)
Class C Shares capital transactions			8,720				218,899				4,171				133,680
Class I Shares:
Proceeds from shares issued			9,187,688				17,658,774				—				—
Dividends reinvested			4,246,858				—				—				—
Value of shares redeemed			(16,500,326	)			(20,773,702	)			—				—
Class I Shares capital transactions			(3,065,780	)			(3,114,928	)			—				—
Change in net assets resulting from capital transactions		$	(4,356,680	)		$	(8,338,642	)		$	1,079,236			$	(429,918	)
SHARE TRANSACTIONS:
Class A Shares:
Issued			27,668				49,445				295,105				77,300
Reinvested			45,103				—				59,888				175,974
Redeemed			(125,574	)			(334,366	)			(246,880	)			(293,635	)
Change in Class A Shares			(52,803	)			(284,921	)			108,113				(40,361	)
Class B Shares:
Issued			1,163				6,924				2,603				8,496
Reinvested			3,120				—				4,862				13,196
Redeemed			(17,588	)			(31,749	)			(21,126	)			(20,335	)
Change in Class B Shares			(13,305	)			(24,825	)			(13,661	)			1,357
Class C Shares:
Issued			3,117				16,065				40,827				14,173
Reinvested			2,526				—				5,175				10,526
Redeemed			(4,667	)			(2,629	)			(42,252	)			(6,916	)
Change in Class C Shares			976				13,436				3,750				17,783
Class I Shares:
Issued			491,350				981,882				—				—
Reinvested			247,171				—				—				—
Redeemed			(859,037	)			(1,163,041	)			—				—
Change in Class I Shares			(120,516	)			(181,159	)			—				—

14        HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC FAMILY OF FUNDS

Statements of Changes in Net Assets (continued)

	Opportunity Fund (Advisor)
	For the				For the
	year ended				year ended
	October 31, 2013				October 31, 2012
Investment Activities:
Operations:
Net investment income (loss)		$	113,802			$	(19,624	)
Net realized gains (losses) from investments			22,059,925				7,509,207
Change in unrealized appreciation/depreciation on investments			28,194,578				7,623,444
Change in net assets resulting from operations			50,368,305				15,113,027
Dividends:
Net realized gains:
Class I Shares			(6,472,825	)			(18,686,312	)
Change in net assets resulting from shareholder dividends			(6,472,825	)			(18,686,312	)
Change in net assets resulting from capital transactions			29,328,028				16,653,597
Change in net assets			73,223,508				13,080,312
Net Assets:
Beginning of period			135,097,630				122,017,318
End of period		$	208,321,138			$	135,097,630
Accumulated net investment income (loss)		$	152,233			$	38,431

See notes to financial statements. HSBC FAMILY OF FUNDS        15

HSBC FAMILY OF FUNDS

Statements of Changes in Net Assets (continued)

	Opportunity Fund (Advisor)
	For the				For the
	year ended				year ended
	October 31, 2013				October 31, 2012
CAPITAL TRANSACTIONS:
Class I Shares:
Proceeds from shares issued		$	43,552,792			$	20,813,526
Dividends reinvested			6,463,988				17,155,964
Value of shares redeemed			(20,688,752	)			(21,315,893	)
Class I Shares capital transactions			29,328,028				16,653,597
Change in net assets resulting from capital transactions		$	29,328,028			$	16,653,597
SHARE TRANSACTIONS:
Class I Shares:
Issued			2,895,000				1,554,122
Reinvested			478,814				1,465,070
Redeemed			(1,392,961	)			(1,642,101	)
Change in Class I Shares			1,980,853				1,377,091

16        HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC GROWTH FUND

Financial Highlights

Selected data for a share outstandingthroughout the periodsindicated.*

				InvestmentActivities					Dividends														Ratios/Supplementary Data
	Net Asset Value, Beginning of Period			Net Investment Income (Loss)(a)			Net Realized and Unrealized Gains (Losses) from Investments	Total from Investment Activities	Net InvestmentIncome			Net Realized Gains from Investment Transactions			Total Dividends			Net Asset Value, End of Period			Total Return(b)		Net Assets at End of Period(000’s)			Ratio of Net Expenses to Average Net Assets			Ratio of Net Investment Income (Loss) to Average Net Assets			Ratios of Expenses to Average Net Assets(Excluding Fee Reductions)			Portfolio Turnover (c)
CLASS A SHARES
Year Ended October 31, 2009		$	10.55		(0.04	)	2.03	1.99		—			—			—			$	12.54	18.86	%(d)		$	15,896		1.20	%		(0.33	)%		1.31	%		66	%
Year Ended October 31, 2010			12.54		(0.07	)	2.55	2.48		—			—			—				15.02	19.78	%(e)(f)			16,452		1.20	%		(0.54	)%(f)		1.23	%		89	%
Year Ended October 31, 2011			15.02		(0.07	)	1.64	1.57		—			—			—				16.59	10.45	%(g)			15,349		1.18	%		(0.45	)%		1.18	%		56	%
Year Ended October 31, 2012			16.59		(0.06	)	1.16	1.10		—			—			—				17.69	6.63	%(h)			11,327		1.20	%		(0.36	)%		1.27	%		53	%
Year Ended October 31, 2013			17.69		(0.01	)	5.34	5.33		—			(1.29	)		(1.29	)			21.73	32.24	%(i)			12,761		1.20	%		(0.05	)%		1.21	%		75	%
CLASS B SHARES
Year Ended October 31, 2009		$	9.85		(0.10	)	1.85	1.75		—			—			—			$	11.60	17.87	%(d)		$	2,059		1.95	%		(1.06	)%		2.06	%		66	%
Year Ended October 31, 2010			11.60		(0.16	)	2.36	2.20		—			—			—				13.80	18.97	%(e)(f)			1,213		1.95	%		(1.28	)%(f)		1.98	%		89	%
Year Ended October 31, 2011			13.80		(0.18	)	1.51	1.33		—			—			—				15.13	9.64	%(g)			962		1.93	%		(1.19	)%		1.93	%		56	%
Year Ended October 31, 2012			15.13		(0.17	)	1.06	0.89		—			—			—				16.02	5.88	%(h)			621		1.95	%		(1.10	)%		2.03	%		53	%
Year Ended October 31, 2013			16.02		(0.12	)	4.75	4.63		—			(1.29	)		(1.29	)			19.36	31.16	%(i)			493		1.95	%		(0.72	)%		1.96	%		75	%
CLASS C SHARES
Year Ended October 31, 2009		$	9.91		(0.12	)	1.89	1.77		—			—			—			$	11.68	17.86	%(d)		$	120		1.95	%		(1.12	)%		2.05	%		66	%
Year Ended October 31, 2010			11.68		(0.17	)	2.38	2.21		—			—			—				13.89	18.92	%(e)(f)			184		1.95	%		(1.30	)%(f)		1.99	%		89	%
Year Ended October 31, 2011			13.89		(0.18	)	1.52	1.34		—			—			—				15.23	9.65	%(g)			251		1.94	%		(1.21	)%		1.94	%		56	%
Year Ended October 31, 2012			15.23		(0.18	)	1.07	0.89		—			—			—				16.12	5.84	%(h)			482		1.95	%		(1.14	)%		2.03	%		53	%
Year Ended October 31, 2013			16.12		(0.14	)	4.80	4.66		—			(1.29	)		(1.29	)			19.49	31.15	%(i)			602		1.95	%		(0.81	)%		1.96	%		75	%
CLASS I SHARES
Year Ended October 31, 2009		$	10.62		(0.01	)	2.04	2.03		—			—			—			$	12.65	19.11	%(d)		$	39,400		0.95	%		(0.08	)%		1.06	%		66	%
Year Ended October 31, 2010			12.65		(0.04	)	2.58	2.54		—			—			—				15.19	20.08	%(e)(f)			49,474		0.95	%		(0.30	)%(f)		0.99	%		89	%
Year Ended October 31, 2011			15.19		(0.04	)	1.68	1.64		—			—			—				16.83	10.80	%(g)			57,222		0.94	%		(0.22	)%		0.94	%		56	%
Year Ended October 31, 2012			16.83		(0.02	)	1.18	1.16		—			—			—				17.99	6.89	%(h)			57,916		0.95	%		(0.12	)%		1.04	%		53	%
Year Ended October 31, 2013			17.99		0.04		5.42	5.46		(0.02	)		(1.29	)		(1.31	)			22.14	32.49	%(i)			68,624		0.95	%		0.20	%		0.96	%		75	%

*	The per share amounts and percentages reflect income and expenses assuming inclusion of the Fund’s proportionate share of the income and expenses of the HSBC Growth Portfolio.
(a)	Calculated based on average shares outstanding.
(b)	Total return calculations do not include any sales or redemption charges.
(c)	Portfolio turnover rate is calculated on the basis of the respective Portfolio in which the Fund invests all of its investable assets. Portfolio turnover rate is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.
(d)	During the year ended October 31, 2009, the Portfolio, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.50%, 0.54%, 0.53% and 0.49% for Class A Shares, Class B Shares, Class C Shares and Class I Shares, respectively.
(e)	During the year ended October 31, 2010, the Portfolio, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.17%, 0.17%, 0.17% and 0.17% for Class A Shares, Class B Shares, Class C Shares and Class I Shares, respectively.
(f)	During the year ended October 31, 2010, the Fund received a distribution from a “fair fund” established by the SEC in connection with a consent order against BISYS Fund Services, Inc. (See Note 7 in the Notes to Financial Statements). The corresponding impact to the net income ratio and the total return was 0.02%, 0.02%, 0.02% and 0.02% for Class A Shares, Class B Shares, Class C Shares and Class I Shares, respectively.
(g)	During the year ended October 31, 2011, the Portfolio, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.28%, 0.28%, 0.28% and 0.28% for Class A Shares, Class B Shares, Class C Shares and Class I Shares, respectively.
(h)	During the year ended October 31, 2012, the Portfolio, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.12%, 0.12%, 0.12% and 0.12% for Class A Shares, Class B Shares, Class C Shares and Class I Shares, respectively.
(i)	During the year ended October 31, 2013, the Portfolio, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.16%, 0.16%, 0.16% and 0.16% for Class A Shares, Class B Shares, Class C Shares and Class I Shares, respectively.

See notes to financial statements. HSBC FAMILY OF FUNDS        17

HSBC OPPORTUNITY FUND

Financial Highlights

Selected data for a share outstandingthroughout the periodsindicated.*

				InvestmentActivities					Dividends											Ratios/Supplementary Data
	Net Asset Value, Beginning of Period			Net Investment Income (Loss)(a)			Net Realized and Unrealized Gains (Losses) from Investments	Total from Investment Activities	Net Realized Gains from Investment Transactions			Total Dividends			Net Asset Value, End of Period			Total Return(b)		Net Assets at End of Period(000’s)			Ratio of Net Expenses to Average Net Assets			Ratio of Net Investment Income (Loss) to Average Net Assets			Ratios of Expenses to Average Net Assets(Excluding Fee Reductions)			Portfolio Turnover (c)
CLASS A SHARES
Year Ended October 31, 2009		$	7.09		(0.07	)	0.97	0.90		(0.43	)		(0.43	)		$	7.56	14.85	%		$	9,687		1.55	%		(1.02	)%		2.30	%		65	%
Year Ended October 31, 2010			7.56		(0.09	)	2.20	2.11		—			—				9.67	27.91	%(d)(e)			11,282		1.55	%		(1.00	)%(e)		2.07	%		68	%
Year Ended October 31, 2011			9.67		(0.07	)	1.19	1.12		(0.16	)		(0.16	)			10.63	11.59	%(f)			11,145		1.55	%		(0.62	)%		1.85	%		69	%
Year Ended October 31, 2012			10.63		(0.05	)	1.11	1.06		(1.56	)		(1.56	)			10.13	12.08	%(g)			10,204		1.55	%		(0.51	)%		2.20	%		59	%
Year Ended October 31, 2013			10.13		(0.06	)	3.34	3.28		(0.63	)		(0.63	)			12.78	34.02	%(h)			14,259		1.55	%		(0.49	)%		2.01	%		70	%
CLASS B SHARES
Year Ended October 31, 2009		$	6.10		(0.10	)	0.80	0.70		(0.43	)		(0.43	)		$	6.37	13.92	%		$	1,082		2.30	%		(1.77	)%		3.10	%		65	%
Year Ended October 31, 2010			6.37		(0.13	)	1.85	1.72		—			—				8.09	27.00	%(d)(e)			658		2.30	%		(1.78	)%(e)		2.86	%		68	%
Year Ended October 31, 2011			8.09		(0.12	)	0.99	0.87		(0.16	)		(0.16	)			8.80	10.75	%(f)			536		2.30	%		(1.36	)%		2.64	%		69	%
Year Ended October 31, 2012			8.80		(0.10	)	0.87	0.77		(1.56	)		(1.56	)			8.01	11.15	%(g)			499		2.30	%		(1.25	)%		2.99	%		59	%
Year Ended October 31, 2013			8.01		(0.11	)	2.60	2.49		(0.63	)		(0.63	)			9.87	33.10	%(h)			480		2.30	%		(1.24	)%		2.77	%		70	%
CLASS C SHARES
Year Ended October 31, 2009		$	6.21		(0.10	)	0.81	0.71		(0.43	)		(0.43	)		$	6.49	13.83	%		$	267		2.30	%		(1.78	)%		3.08	%		65	%
Year Ended October 31, 2010			6.49		(0.13	)	1.89	1.76		—			—				8.25	27.12	%(d)(e)			341		2.30	%		(1.75	)%(e)		2.86	%		68	%
Year Ended October 31, 2011			8.25		(0.13	)	1.02	0.89		(0.16	)		(0.16	)			8.98	10.79	%(f)			437		2.30	%		(1.38	)%		2.64	%		69	%
Year Ended October 31, 2012			8.98		(0.10	)	0.89	0.79		(1.56	)		(1.56	)			8.21	11.14	%(g)			545		2.30	%		(1.19	)%		3.03	%		59	%
Year Ended October 31, 2013			8.21		(0.11	)	2.67	2.56		(0.63	)		(0.63	)			10.14	33.15	%(h)			711		2.30	%		(1.21	)%		2.76	%		70	%

*	The per share amounts and percentages reflect income and expenses assuming inclusion of the Fund’s proportionate share of the income and expenses of the HSBC Opportunity Portfolio.
(a)	Calculated based on average shares outstanding.
(b)	Total return calculations do not include any sales or redemption charges.
(c)	Portfolio turnover rate is calculated on the basis of the respective Portfolio in which the Fund invests all of its investable assets. Portfolio turnover rate is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.
(d)	During the year ended October 31, 2010, the Portfolio, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.15%, 0.15% and 0.15% for Class A Shares, Class B Shares and Class C Shares, respectively.
(e)	During the year ended October 31, 2010, the Fund received a distribution from a “fair fund” established by the SEC in connection with a consent order against BISYS Fund Services, Inc. (See Note 7 in the Notes to Financial Statements). Corresponding impact to the net income ratio and the total return was 0.01%, 0.01% and 0.01% for Class A Shares, Class B Shares and Class C Shares, respectively.
(f)	During the year ended October 31, 2011, the Portfolio, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.10%, 0.10% and 0.10% for Class A Shares, Class B Shares and Class C Shares, respectively.
(g)	During the year ended October 31, 2012, the Portfolio, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.10%, 0.10% and 0.10% for Class A Shares, Class B Shares and Class C Shares, respectively.
(h)	During the year ended October 31, 2013, the Portfolio, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.13%, 0.13% and 0.13% for Class A Shares, Class B Shares and Class C Shares, respectively.

18       HSBC FAMILY OF FUNDS See notes to financial statements.

HSBC OPPORTUNITY FUND (ADVISOR)

Financial Highlights

Selected data for a share outstandingthroughout the periodsindicated.*

				InvestmentActivities					Dividends											Ratios/Supplementary Data
	Net Asset Value, Beginning of Period			Net Investment Income (Loss)			Net Realized and Unrealized Gains (Losses) from Investments	Total from Investment Activities	Net Realized Gains from Investment Transactions			Total Dividends			Net Asset Value, End of Period			Total Return(a)		Net Assets at End of Period(000’s)			Ratio of Net Expenses to Average Net Assets			Ratio of Net Investment Income (Loss) to Average Net Assets			Ratios of Expenses to Average Net Assets(Excluding Fee Reductions)			Portfolio Turnover (b)
CLASS I SHARES
Year Ended October 31, 2009		$	8.91		(0.04	)	1.32	1.28		(0.26	)		(0.26	)		$	9.93	15.47	%		$	100,285		1.02	%		(0.50	)%		1.02	%		65	%
Year Ended October 31, 2010			9.93		(0.06	)	2.90	2.84		—			—				12.77	28.60	%(c)(d)			117,064		1.01	%		(0.46	)%(d)		1.01	%		68	%
Year Ended October 31, 2011			12.77		(0.01	)	1.57	1.56		(0.31	)		(0.31	)			14.02	12.25	%(e)			122,017		1.01	%		(0.07	)%		1.01	%		69	%
Year Ended October 31, 2012			14.02		(0.01	)	1.46	1.45		(2.07	)		(2.07	)			13.40	12.50	%(f)			135,098		1.08	%		(0.01	)%		1.08	%		59	%
Year Ended October 31, 2013			13.40		0.01		4.47	4.48		(0.61	)		(0.61	)			17.27	34.70	%(g)			208,321		0.99	%		0.07	%		0.99	%		70	%

*	The per share amounts and percentages reflect income and expense assuming inclusion of the Fund’s proportionate share of the income and expenses of the HSBC Opportunity Portfolio.
(a)	Total return calculations do not include any sales or redemption charges.
(b)	Portfolio turnover rate is calculated on the basis of the respective Portfolio in which the Fund invests all of its investable assets. Portfolio turnover rate is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.
(c)	During the year ended October 31, 2010, the Portfolio, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.15% for Class I Shares.
(d)	During the year ended October 31, 2010, the Fund received a distribution from a “fair fund” established by the SEC in connection with a consent order against BISYS Fund Services, Inc. (See Note 7 in the Notes to Financial Statements). The corresponding impact to the net income ratio and the total return was 0.01% for the Class I Shares.
(e)	During the year ended October 31, 2011, the Portfolio, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.10% for Class I Shares.
(f)	During the year ended October 31, 2012, the Portfolio, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.10% for Class I Shares.
(g)	During the year ended October 31, 2013, the Portfolio, in which the Fund invests, received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.13% for Class I Shares.

See notes to financial statements. HSBC FAMILY OF FUNDS        19

HSBC FAMILY OF FUNDS

Notes to Financial Statements — as of October 31, 2013

1. Organization:

     The HSBC Funds (the “Trust”), a Massachusetts business trust organized on April 22, 1987, and the HSBC Advisor Funds Trust (the “Advisor Trust”), a Massachusetts business trust organized on April 5, 1996, are registered under the Investment Company Act of 1940, as amended (the “Act”), asopen-end management investment companies. As of October 31, 2013, the Trust is comprised of 15 separate operational funds and the Advisor Trust is comprised of 1 operational fund, each a series of the HSBC Family of Funds, which also includes the HSBC Portfolios (the “Portfolio Trust”) (collectively the “Trusts”). The accompanying financial statements are presented for the following 3 funds (individually a “Fund”, collectively the “Funds”) of the Trust and Advisor Trust:

Fund	Short Name	Trust
HSBC Growth Fund	Growth Fund	Trust
HSBC Opportunity Fund	Opportunity Fund	Trust
HSBC Opportunity Fund (Advisor)	Opportunity Fund (Advisor)	Advisor Trust

All the Funds are diversified funds. Financial statements for all other funds of the Trusts are published separately.

Each Fund utilizes a master-feeder fund structure and seeks to achieve its investment objectives by investing all of its investable assets in its respective Portfolio (as defined below).

		Proportionate
		Ownership
		Interest on
Fund	Respective Portfolio	October 31, 2013(%)
Growth Fund	HSBC Growth Portfolio		93.1
Opportunity Fund	HSBC Opportunity Portfolio		6.8
Opportunity Fund (Advisor)	HSBC Opportunity Portfolio		91.7

The HSBC Growth Portfolio and HSBC Opportunity Portfolio (individually a “Portfolio”, collectively the “Portfolios”) are diversified series of the Portfolio Trust. The Portfolios operate as master funds in master-feeder arrangements and also may receive investments from certain fund of funds.

The financial statements of the Portfolios, including the Schedules of Portfolio Investments, are included elsewhere in this report. The financial statements of the Portfolios should be read in conjunction with the financial statements of the Funds.

The Funds are authorized to issue an unlimited number of shares of beneficial interest with a par value of $ 0.001 per share. The Growth Fund offers four classes of shares: Class A Shares, Class B Shares, Class C Shares, and Class I Shares. The Opportunity Fund offers three classes of shares: Class A Shares, Class B Shares, and Class C Shares. The Opportunity Fund (Advisor) offers one class of shares: Class I Shares. Class A Shares of the Funds have a maximum sales charge of 5.00% as a percentage of the original purchase price. Class B Shares of the Funds are offered without any front-end sales charge but will be subject to a contingent deferred sales charge (“CDSC”) ranging from a maximum of 4.00% if redeemed less than one year after purchase to 0.00% if redeemed more than four years after purchase. Class C Shares of the Funds are offered without any front-end sales charge but will be subject to a maximum CDSC of 1.00% if redeemed less than one year after purchase. No sales charges are assessed with respect to Class I Shares of the Funds. Each class of shares in the Funds has identical rights and privileges except with respect to arrangements pertaining to shareholder servicing and/or distribution, class-related expenses, voting rights on matters affecting a single class of shares, and the exchange privilege of each class of shares. Effective as of August 1, 2013, Class B Shares of the Funds may no longer be purchased or acquired by any new or existing Class B shareholder, except through dividend and/or capital gains reinvestment.

20       HSBC FAMILY OF FUNDS

HSBC FAMILY OF FUNDS

Notes to Financial Statements — as of October 31, 2013 (continued)

     Under the Trusts’ organizational documents, the Trusts’ officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Funds. In addition, in the normal course of business, the Trusts enter into contracts with service providers, which also provide for indemnifications by the Funds. The Funds’ maximum exposure under these arrangements is unknown, as this would involve any future claims that may be made against the Funds. However, based on experience, the Trusts expect that risk of loss to be remote.

2. Significant Accounting Policies:

The following is a summary of the significant accounting policies followed by the Funds in the preparation of their financial statements. The policies are in conformity with U.S. generally accepted accounting principles (“GAAP”). The preparation of financial statements requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

Securities Valuation:

The Funds record their investments at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The valuation techniques used to determine fair value are further described in Note 3 below.

Investment Transactions and Related Income:

The Funds record investments into the Portfolios on a trade date basis. The Funds record daily their proportionate share of income, expenses, changes in unrealized appreciation and depreciation and realized gains and losses derived from their respective Portfolios. In addition, the Funds accrue their own expenses daily as incurred.

Allocations:

Expenses directly attributable to a Fund are charged to that Fund. Expenses not directly attributable to a Fund are allocated proportionately among the applicable series within the Trusts in relation to the net assets of each fund or on another reasonable basis. Class specific expenses are charged directly to the class incurring the expense. In addition, income, expenses (other than class specific expenses), and unrealized and realized gains and losses are allocated to each class based on relative net assets on a daily basis.

Dividends to Shareholders:

Dividends to shareholders from net investment income, if any, are declared and distributed semi-annually in the case of the Funds.

The Funds’ net realized gains, if any, are distributed to shareholders at least annually. Additional distributions are also made to the Funds’ shareholders to the extent necessary to avoid the federal excise tax on certain undistributed income and net capital gains of regulated investment companies.

The amount and character of net investment income and net realized gains distributions are determined in accordance with federal income tax regulations which may differ from GAAP. These “book/tax” differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature (e.g., reclassification of market discounts, certain gain/loss, paydowns, and certain distributions), such amounts are reclassified within the composition of net assets; temporary differences (e.g., wash losses and post-October loss deferrals) do not require reclassification. The Funds may utilize equalization accounting for tax purposes and designate earnings and profits, including net realized gains distributed to shareholders on redemption of shares, as a part of the dividends paid deduction for income tax purposes. To the extent distributions to shareholders from net investment income and net realized gains exceed net investment income and net realized gains for tax purposes, they are reported as distributions of capital.

HSBC FAMILY OF FUNDS       21

HSBC FAMILY OF FUNDS

Notes to Financial Statements — as of October 31, 2013 (continued)

Federal Income Taxes:

     Each Fund is a separate taxable entity for federal income tax purposes. Each Fund has qualified and intends to continue to qualify each year as a “regulated investment company” under Subchapter M of the Internal Revenue Code, as amended, and to distribute substantially all of its taxable net investment income and net realized gains, if any, to its shareholders. Accordingly, no provision for federal income or excise tax is required.

Management of the Funds has reviewed tax positions taken in tax years that remain subject to examination by all major tax jurisdictions, including federal (i.e., the last four tax year ends and the interim tax period since then, as applicable). Management believes that there is no tax liability resulting from unrecognized tax benefits related to uncertain tax positions taken.

New Accounting Pronouncements:

In January 2013, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2013-01 “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities” (“ASU 2013-01”), which amended Accounting Standards Codification Subtopic 210-20, Balance Sheet Offsetting. ASU 2013-01 clarified the scope of ASU No. 2011-11 “Disclosures about Offsetting Assets and Liabilities” (“ASU 2011-11”). ASU 2011-11 requires an entity to disclose information about offsetting and related arrangements to enable users of the financial statements to understand the effect of those arrangements on the entity’s financial position. ASU 2013-01 clarifies the scope of ASU 2011-11 as applying to derivatives accounted for in accordance with Topic 815, Derivatives and Hedging, including bifurcated embedded derivatives, repurchase agreements and reverse repurchase agreements, and securities borrowing and securities lending transactions that are offset either in accordance with other requirements of GAAP or subject to an enforceable master netting arrangement or similar agreement. The guidance in ASU 2013-01 and ASU 2011-11 is effective for interim and annual periods beginning on or after January 1, 2013. Management is evaluating any impact ASU 2013-01 and ASU 2011-11 may have on the Funds’ financial statements.

3. Investment Valuation Summary:

The valuation techniques employed by the Funds, as described below, maximize the use of observable inputs and minimize the use of unobservable inputs in determining fair value. The inputs used for valuing the Funds’ investments are summarized in the three broad levels listed below:

• Level 1: quoted prices in active markets for identical assets
   
• Level 2: other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.)
   
• Level 3: significant unobservable inputs (including a Fund’s own assumptions in determining the fair value of investments)

Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The Funds determine transfers between fair value hierarchy levels at the reporting period end. The inputs or methodology used for valuing investments are not necessarily an indication of the risk associated with investing in those investments.

The Funds record their investments in their respective Portfolios at fair value, which is typically categorized as Level 2 in the fair value hierarchy. The underlying securities of the Portfolios are recorded at fair value, as discussed more fully in the Notes to Financial Statements of the Portfolios included elsewhere in this report.

22       HSBC FAMILY OF FUNDS

HSBC FAMILY OF FUNDS

Notes to Financial Statements — as of October 31, 2013 (continued)

     For the year ended October 31, 2013, there were no Level 3 investments for which significant unobservable inputs were used to determine fair value. The following is a summary of the valuation inputs used as of October 31, 2013 in valuing the Funds’ investments based upon the three levels defined above:

	LEVEL 1 ($)	LEVEL 2 ($)	LEVEL 3 ($)	Total ($)
Growth Fund
Investment Securities:
Affiliated Portfolios(a)	—	82,541,055	—	82,541,055
Total Investment Companies	—	82,541,055	—	82,541,055
Opportunity Fund
Investment Securities:
Affiliated Portfolios(a)	—	15,489,119	—	15,489,119
Total Investment Companies	—	15,489,119	—	15,489,119
Opportunity Fund (Advisor)
Investment Companies:
Affiliated Portfolios(a)	—	208,208,427	—	208,208,427
Total Investment Companies	—	208,208,427	—	208,208,427

____________________
 

(a) Investments in Affiliated Portfolios represent ownership interests in the Portfolios. Due to the Funds’ master-feeder structure, the inputs used for valuing these instruments are categorized as Level 2.

4. Related Party Transactions and Other Agreements and Plans:

Investment Management:

HSBC Global Asset Management (USA) Inc. (“HSBC” or the “Investment Adviser”), a wholly owned subsidiary of HSBC Bank USA, N.A., a national bank organized under the laws of the United States, acts as Investment Adviser to the Portfolios. As Investment Adviser, HSBC manages the investments of the Portfolios and continuously reviews, supervises, and administers the Portfolios’ investments. The Funds are not directly charged any investment management fees.

Administration:

HSBC serves the Funds as Administrator. Under the terms of the Administration Agreement, HSBC receives from the Funds (as well as other funds in the Trusts combined) a fee, accrued daily and paid monthly, at an annual rate of:

Based on Combined Average Daily Net Assets of	Fee Rate(%)
Up to $10 billion	0.0550
In excess of $10 billion but not exceeding $20 billion	0.0350
In excess of $20 billion but not exceeding $50 billion	0.0275
In excess of $50 billion	0.0250

The fee rates and breakpoints are determined on the basis of the aggregate average daily net assets of the Trusts. The total administration fee paid to HSBC is allocated to each series based upon its proportionate share of the aggregate net assets of the Trusts. For assets invested in the Portfolios by the Funds, the Portfolios pay half of the administration fee and the Funds pay half, for a combination of the total fee rate as set forth above. Certain administration fees of the Portfolios also may be reduced by treating them as apportioned in part to other funds making investments in the Portfolios. An amount equal to 50% of the administration fee is deemed to be class specific.

HSBC FAMILY OF FUNDS       23

HSBC FAMILY OF FUNDS

Notes to Financial Statements — as of October 31, 2013 (continued)

     Pursuant to a Sub-Administration Agreement with HSBC, Citi Fund Services Ohio, Inc. (“Citi”), a wholly-owned subsidiary of Citigroup, Inc., serves as the Trusts’ Sub-Administrator, subject to the general supervision by the Trusts’ Board of Trustees (the “Board”) and HSBC. For these services, Citi is entitled to a fee, payable by HSBC, at an annual rate equivalent to the fee rates set forth above subject to certain reductions associated with services provided to new funds, minus 0.02% which is retained by HSBC.

Under a Compliance Services Agreement between the Trusts and Citi (the “CCO Agreement”), Citi makes an employee available to serve as the Trusts’ Chief Compliance Officer (the “CCO”). Under the CCO Agreement, Citi also provides infrastructure and support in implementing the written policies and procedures comprising the Trusts’ compliance program, including support services to the CCO. For the services provided under the CCO Agreement, the Trusts paid Citi $287,560 for the year ended October 31, 2013, plus reimbursement of certain out of pocket expenses. Expenses incurred by each Fund are reflected on the Statements of Operations as “Compliance Services.” Citi pays the salary and other compensation earned by individuals performing these services, as employees of Citi.

Distribution Arrangements:

Foreside Distribution Services, L.P. (“Foreside”), a wholly-owned subsidiary of Foreside Financial Group LLC, serves the Trust as Distributor (the “Distributor”). The Trust has adopted a non-compensatory Distribution Plan and Agreement (the “Distribution Plan”) pursuant to Rule 12b-1 of the Act. The Distribution Plan provides for reimbursement of expenses incurred by the Distributor related to distribution and marketing, at a rate not to exceed 0.25%, 1.00%, and 1.00% of the average daily net assets of Class A Shares (currently not being charged), Class B Shares (currently charging 0.75%), and Class C Shares (currently charging 0.75%) of the Funds, respectively. For the year ended October 31, 2013, Foreside, as Distributor, also received $213,520, $105,439, and $49,940 in commissions from sales of the Trusts, for Class A Shares, Class B Shares, and Class C Shares, respectively of which $584, $89, and $0 were reallocated to HSBC-affiliated brokers and dealers, for Class A Shares, Class B Shares, and Class C Shares, respectively.

Shareholder Servicing:

The Trust has adopted a Shareholder Services Plan, which provides for payments to shareholder servicing agents (which primarily consist of HSBC and its affiliates) for providing various shareholder services. For performing these services, the shareholder servicing agents receive a fee that is computed daily and paid monthly up to 0.25%, 0.25%, and 0.25% of the average daily net assets of Class A Shares, Class B Shares, and Class C Shares of the Funds, respectively. Thefees paid to the Distributor pursuant to the Distribution Plan and to shareholder servicing agents pursuant to the Shareholder Services Plan will not exceed in the aggregate 0.25% of the average daily net assets of Class A Shares, and 1.00% of the average daily net assets of Class B Shares and Class C Shares.

Fund Accounting and Transfer Agency:

Citi provides fund accounting and transfer agency services for each Fund. As transfer agent, Citi receives a fee based on the number of funds and shareholder accounts, subject to certain minimums, reductions associated with services provided to new funds and reimbursement of certain expenses. As fund accountant, Citi receives an annual fee per Fund and share class, subject to minimums, reductions associated with services provided to new funds and reimbursement of certain expenses. Citi receives additional fees paid by the Trust and the Advisor Trust for blue sky exemption services.

Independent Trustees:

The Trusts pay each Independent Trustee an annual retainer of $100,000. The Trusts pay a fee of $10,000 for each regular meeting of the Board attended and a fee of $ 3,000 for each special meeting attended. The Trusts pay each Committee Chair an annual retainer of $ 3,000, with the exception of the Chair of the Audit Committee, who receives a retainer of $ 6,000. The Trusts also pay the Chairman of the Board, an additional annual retainer of $24,000. In addition, for time expended on Board duties outside normal meetings, which is authorized by the Board, a Trustee is compensated at the rate of $ 500 per hour, up to a maximum of $3,000 per day.

24       HSBC FAMILY OF FUNDS

HSBC FAMILY OF FUNDS

Notes to Financial Statements — as of October 31, 2013 (continued)

Fee Reductions:

     The Investment Adviser has agreed to contractually limit, through March 1, 2014, the annual total expenses, exclusive of interest, taxes, brokerage commissions, extraordinary expenses, and estimated indirect expenses attributed to a Fund’s investment in investment companies of certain Funds. Each affected Fund Class has its own expense limitations based on the average daily net assets for any full fiscal year as follows:

		Current Contractual
		Expense
Fund	Class	Limitation(%)
Growth Fund	A	1.20
Growth Fund	B	1.95
Growth Fund	C	1.95
Growth Fund	I	0.95
Opportunity Fund	A	1.65
Opportunity Fund	B	2.40
Opportunity Fund	C	2.40
Opportunity Fund (Advisor)	I	1.10

Any amounts contractually waived or reimbursed by the Investment Adviser will be subject to repayment by the respective Fund to the Investment Adviser within three years to the extent that the repayment will not cause the Fund’s operating expenses to exceed the contractual expense limit that was in effect at the time of such waiver or reimbursement. During the year ended October 31, 2013, the Investment Adviser did not recapture any of its prior contractual waivers or reimbursements. As of October 31, 2013, the repayments that may potentially be made by the Funds are as follows:

Fund	2016($)	2015($)	2014($)	Total
Growth Fund	5,267	65,181	—	70,448
Opportunity Fund	46,445	65,241	27,228	138,914

The Administrator and Citi may voluntarily waive/reimburse fees to help support the expense limits of the Funds. In addition, HSBC, in its role as Investment Adviser and Administrator, may waive/reimburse additional fees at its discretion. Any voluntary fee waivers/reimbursements are not subject to recoupment in subsequent fiscal periods. Voluntary waivers/reimbursements may be stopped at any time. Amounts waived/reimbursed by the Investment Adviser, Administrator and Citi are reported separately on the Statements of Operations, as applicable.

5. Investment Transactions:

Contributions and withdrawals of the respective Portfolios for the year ended October 31, 2013 totaled:

Fund	Contributions($)		Withdrawals($)
Growth Fund		4,105,330		13,848,759
Opportunity Fund		2,826,611		2,492,440
Opportunity Fund (Advisor)		34,440,619		11,972,238

HSBC FAMILY OF FUNDS       25

HSBC FAMILY OF FUNDS

Notes to Financial Statements — as of October 31, 2013 (continued)

6. Federal Income Tax Information:

     The tax character of dividends paid by the Funds for the tax year ended October 31, 2013 was as follows:

	Dividends paid from
								Total
	Ordinary		Net Long Term		Total Taxable		Return of	Dividends
	Income ($)		Capital Gains ($)		Dividends ($)		Capital ($)	Paid ($)(1)
Growth Fund		77,975		5,056,287		5,134,262	—	5,134,262
Opportunity Fund		—		693,083		693,083	—	693,083
Opportunity Fund (Advisor)		—		6,472,825		6,472,825	—	6,472,825

The tax character of dividends paid by the Funds for the tax year ended October 31, 2012 was as follows:

	Dividends paid from
						Total
	Ordinary	Net Long Term		Total Taxable	Return of	Dividends
	Income ($)	Capital Gains ($)		Dividends ($)	Capital ($)	Paid ($)(1)
Opportunity Fund	122,612		1,646,254	1,768,866	—	1,768,866
Opportunity Fund (Advisor)	2,322,165		16,364,147	18,686,312	—	18,686,312

____________________
 

(1) Total dividends paid may differ from the amount reported in the Statement of Changes in Net Assets because dividends are recognized when actually paid for tax purposes.

As of the tax year October 31, 2013, the components of accumulated earnings/(deficit) on a tax basis for the Funds were as follows:

				Undistributed					Accumulated	Unrealized		Total
	Undistributed		Undistributed	Long Term					Capital and	Appreciation/		Accumulated
	Ordinary		Tax Exempt	Capital		Accumulated		Dividends	Other	(Depreciation)		Earnings/
	Income ($)		Income ($)	Gains ($)		Earnings ($)		Payable ($)	Losses ($)	($)(1)		(Deficit) ($)
Growth Fund		848,249	—		8,732,299		9,580,548	—	(99,109)		21,764,615		31,246,054
Opportunity Fund		61,565	—		1,630,496		1,692,061	—	—		3,677,236		5,369,297
Opportunity Fund
(Advisor)		2,210,509	—		19,414,139		21,624,648	—	—		46,985,800		68,610,448

____________________
 

(1) The differences between book-basis and tax-basis unrealized appreciation/depreciation are attributable primarily to: tax deferral of losses on wash sales, the realization for tax purposes of unrealized gains/losses on certain derivative instruments, the difference between book and tax amortization methods for premium and market discount, the realization for tax purposes of unrealized gains/losses on investments in passive foreign investment companies and the return of capital adjustments from real estate investment trusts.

Under current law, capital losses and specified ordinary losses realized after October 31st and non-specified ordinary losses incurred after December 31st (ordinary losses collectively known as “late year ordinary loss”) may be deferred and treated as occurring on the first business day of the following fiscal year. As of the tax year ended October 31, 2013, the following Funds had deferred losses, which will be treated as arising on the first day of the fiscal year ending October 31, 2014.

	Late Year
	Ordinary Losses ($)
Growth Fund	99,109

26       HSBC FAMILY OF FUNDS

HSBC FAMILY OF FUNDS

Notes to Financial Statements — as of October 31, 2013 (continued)

7. Legal and Regulatory Matters:

     On September 26, 2006 BISYS Fund Services, Inc. (“BISYS”), an affiliate of BISYS Fund Services Ohio, Inc. which provided various services to the Funds, reached a settlement with the Securities and Exchange Commission (the “SEC”) regarding the SEC’s investigation related to BISYS’ past payment of certain marketing and other expenses with respect to certain of its mutual fund clients. The related settlement monies were received by the Funds during the year ended October 31, 2010. The corresponding impact to the net income ratio and total return for the year ended October 31, 2010 are disclosed in the Funds’ Financial Highlights.

8. Subsequent Events:

Management has evaluated events and transactions through the date the financial statements were issued, for purposes of recognition or disclosure in these financial statements and there are no subsequent events to report.

HSBC FAMILY OF FUNDS       27

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Trustees of HSBC Funds and
HSBC Advisor Funds Trust:

We have audited the accompanying statements of assets and liabilities of HSBC Growth Fund, HSBC Opportunity Fund and HSBC Opportunity Fund (Advisor) (the Funds), as of October 31, 2013, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period then ended. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the auditto obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of October 31, 2013, by correspondence with the transfer agent of the HSBC Portfolios. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Funds as of October 31, 2013, the results of their operations for the year then ended, the changes in their net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period then ended, in conformity with U.S. generally accepted accounting principles.

Columbus, Ohio
December 27, 2013

28       HSBC FAMILY OF FUNDS

HSBC FAMILY OF FUNDS

Other Federal Income Tax Information — as of October 31, 2013 (Unaudited)

     During the year ended October 31, 2013, the following Funds declared capital gain distributions:

	Short Term	Long Term
	Capital Gain	Capital Gain
	Distributions ($)	Distributions ($)
Growth Fund	—		5,056,287
Opportunity Fund	—		693,083
Opportunity Fund (Advisor)	—		6,472,825

For the year ended October 31, 2013, the following percentages of the total ordinary income dividends paid by the Fund qualify for the corporate dividends received deduction available to corporate shareholders:

	Dividends
	Received
	Deduction (%)
Growth Fund	87.17

For the year ended October 31, 2013, dividends paid by the following Fund may be subject to a maximum tax rate of 15%, as provided for by the Jobs and Growth Tax Relief Reconciliation Act of 2003. The Fund intends to designate the maximum amount allowable as taxed at a maximum rate of 15%. Complete information will be reported in conjunction with your 2013 Form 1099-DIV:

	Qualified
	Dividend
	Income (%)
Growth Fund	79.00

HSBC FAMILY OF FUNDS       29

HSBC FAMILY OF FUNDS

Table of Shareholder Expenses — as of October 31, 2013 (Unaudited)

     As a shareholder of the Funds, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, redemption fees and exchange fees; and (2) ongoing costs, including management fees, distribution fees and/or shareholder servicing fees and other Fund expenses (including expenses allocated from the Portfolios). These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds.

These examples are based on an investment of $1,000 invested at the beginning of the period and held for the entire period from May 1, 2013 through October 31, 2013.

Actual Example

The table below provides information about actual account values and actual expenses. You may use the information below, 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 table under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

											Annualized
		Beginning			Ending			Expenses Paid			Expense Ratio
		Account Value			Account Value			During Period*			During Period
		5/1/13			10/31/13			5/1/13 - 10/31/13			5/1/13 - 10/31/13
Growth Fund	Class A Shares		$	1,000.00		$	1,167.70		$	6.56	1.20	%
	Class B Shares			1,000.00			1,162.80			10.63	1.95	%
	Class C Shares			1,000.00			1,162.90			10.63	1.95	%
	Class I Shares			1,000.00			1,168.30			5.19	0.95	%
Opportunity Fund	Class A Shares			1,000.00			1,136.00			8.35	1.55	%
	Class B Shares			1,000.00			1,131.90			12.36	2.30	%
	Class C Shares			1,000.00			1,131.70			12.36	2.30	%
Opportunity Fund (I Shares)	Class I Shares			1,000.00			1,138.40			5.28	0.98	%

____________________
 

* Expenses are equal to the average account value over the period, multiplied by the Fund’s annualized expense ratio, multiplied by 184/365 (to reflect the one half year period).

30       HSBC FAMILY OF FUNDS

HSBC FAMILY OF FUNDS

Table of Shareholder Expenses — as of October 31, 2013 (Unaudited) (continued)

Hypothetical Example for Comparison Purposes

     The table below provides information about hypothetical account values and hypothetical expenses based on each 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 this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

											Annualized
		Beginning			Ending			Expenses Paid			Expense Ratio
		Account Value			Account Value			During Period*			During Period
		5/1/13			10/31/13			5/1/13 - 10/31/13			5/1/13 - 10/31/13
Growth Fund	Class A Shares		$	1,000.00		$	1,019.16		$	6.11	1.20	%
	Class B Shares			1,000.00			1,015.38			9.91	1.95	%
	Class C Shares			1,000.00			1,015.38			9.91	1.95	%
	Class I Shares			1,000.00			1,020.42			4.84	0.95	%
Opportunity Fund	Class A Shares			1,000.00			1,017.39			7.88	1.55	%
	Class B Shares			1,000.00			1,013.61			11.67	2.30	%
	Class C Shares			1,000.00			1,013.61			11.67	2.30	%
Opportunity Fund (I Shares)	Class I Shares			1,000.00			1,020.27			4.99	0.98	%

____________________
 

* Expenses are equal to the average account value over the period, multiplied by the Fund’s annualized expense ratio, multiplied by 184/365 (to reflect the one half year period).

HSBC FAMILY OF FUNDS       31

HSBC GROWTH PORTFOLIO

Schedule of Portfolio Investments — as of October 31, 2013

Common Stocks – 98.9%
	Shares	Value ($)
Aerospace & Defense – 3.1%
Precision Castparts Corp.	6,300	1,596,735
United Technologies Corp.	11,250	1,195,312
		2,792,047
Airlines – 0.7%
Delta Air Lines, Inc.	23,050	608,059
Auto Components – 1.2%
BorgWarner, Inc.	10,200	1,051,926
Biotechnology – 9.1%
Alexion Pharmaceuticals, Inc. (a)	7,300	897,535
Amgen, Inc.	13,850	1,606,600
Biogen Idec, Inc. (a)	6,900	1,684,911
Celgene Corp. (a)	14,050	2,086,284
Gilead Sciences, Inc. (a)	25,650	1,820,894
		8,096,224
Capital Markets – 3.7%
BlackRock, Inc.	5,365	1,613,846
Morgan Stanley	45,900	1,318,707
The Charles Schwab Corp.	13,800	312,570
		3,245,123
Chemicals – 4.1%
Ecolab, Inc.	9,500	1,007,000
Monsanto Co.	25,149	2,637,627
		3,644,627
Communications Equipment – 1.5%
F5 Networks, Inc. (a)	6,200	505,362
Qualcomm, Inc.	12,350	857,955
		1,363,317
Computers & Peripherals – 3.1%
Apple, Inc.	5,210	2,721,444
Diversified Financial Services – 1.2%
American Express Co.	13,100	1,071,580
Energy Equipment & Services – 1.5%
Schlumberger Ltd.	14,000	1,312,080
Food & Staples Retailing – 2.4%
Costco Wholesale Corp.	6,900	814,200
CVS Caremark Corp.	15,400	958,804
Whole Foods Market, Inc.	5,400	340,902
		2,113,906
Health Care Providers & Services – 0.9%
Catamaran Corp. (a)	16,400	770,144
Health Care Technology – 1.7%
athenahealth, Inc. (a)	3,600	480,636
Cerner Corp. (a)	18,000	1,008,540
		1,489,176
Hotels, Restaurants & Leisure – 3.8%
Chipotle Mexican Grill, Inc. (a)	1,170	616,555
Starbucks Corp.	23,200	1,880,360
Wynn Resorts Ltd.	5,200	864,500
		3,361,415
Internet & Catalog Retail – 6.8%
Amazon.com, Inc. (a)	8,235	2,997,787
Priceline.com, Inc. (a)	2,920	3,077,184
		6,074,971
Internet Software & Services – 9.4%
Baidu, Inc. (a)	4,400	707,960
eBay, Inc. (a)	30,150	1,589,206
Facebook, Inc., Class A(a)	35,100	1,764,126
Google, Inc., Class A(a)	3,550	3,658,559
LinkedIn Corp., Class A(a)	2,900	648,643
		8,368,494
IT Services – 6.3%
Cognizant Technology Solutions Corp.,
Class A(a)	12,100	1,051,853
MasterCard, Inc., Class A	1,955	1,401,930
Visa, Inc., Class A	16,100	3,166,387
		5,620,170
Machinery – 2.7%
Danaher Corp.	33,000	2,378,970
Media – 5.0%
CBS Corp., Class B	19,600	1,159,144
Liberty Global plc, Class A(a)	11,700	916,929
The Walt Disney Co.	14,400	987,696
tt Century Fox, Inc., Class A	39,750	1,354,680
		4,418,449
Oil, Gas & Consumable Fuels – 4.1%
EOG Resources, Inc.	4,300	767,120
Noble Energy, Inc.	14,000	1,049,020
Pioneer Natural Resources Co.	4,700	962,466
Range Resources Corp.	11,400	863,094
		3,641,700
Personal Products – 1.1%
The Estee Lauder Cos., Inc., Class A	13,150	933,124
Pharmaceuticals – 2.1%
Bristol-Myers Squibb Co.	15,400	808,808
Zoetis, Inc.	34,000	1,076,440
		1,885,248
Real Estate Investment Trusts (REITs) – 1.5%
American Tower Corp.	16,700	1,325,145
Road & Rail – 4.1%
The Kansas City Southern Railway Co.	3,600	437,472
Union Pacific Corp.	21,150	3,202,110
		3,639,582

32       HSBC PORTFOLIOS See notes to financial statements.

HSBC GROWTH PORTFOLIO

Schedule of Portfolio Investments — as of October 31, 2013 (continued)

Common Stocks, continued
	Shares	Value ($)
Semiconductors & Semiconductor Equipment – 3.0%
Applied Materials, Inc.	47,800	853,230
ARM Holdings plc ADR	20,100	948,519
NXP Semiconductors NV (a)	21,250	895,050
		2,696,799
Software – 3.4%
Salesforce.com, Inc. (a)	47,150	2,515,924
ServiceNow, Inc. (a)	8,700	475,107
		2,991,031
Specialty Retail – 5.9%
Best Buy Co., Inc.	7,350	314,580
Dollar General Corp. (a)	22,300	1,288,494
Lowe’s Cos., Inc.	22,300	1,110,094
Ross Stores, Inc.	12,600	974,610
Ulta Salon, Cosmetics & Fragrance,
Inc. (a)	11,700	1,507,545
		5,195,323
Textiles, Apparel & Luxury Goods – 3.1%
Lululemon Athletica, Inc. (a)	8,500	586,925
NIKE, Inc., Class B	18,300	1,386,408
Ralph Lauren Corp.	4,900	811,636
		2,784,969
Trading Companies & Distributors – 1.0%
W. W. Grainger, Inc.	3,365	905,084
Wireless Telecommunication Services – 1.4%
SBA Communications Corp.,
Class A(a)	14,250	1,246,448
TOTAL COMMON STOCKS
(COST $62,689,144)		87,746,575
Investment Companies – 0.7%
Northern Institutional Diversified Assets
Portfolio, Institutional Shares,
0.01% (b)	606,946	606,946
TOTAL INVESTMENT COMPANIES
(COST $606,946)		606,946
TOTAL INVESTMENT SECURITIES
(COST $63,296,090) — 99.6%		88,353,521

____________________

Percentages indicated are based on net assets of $88,684,466.
(a)	Represents non-income producing security.
(b)	The rate represents the annualized one-day yield that was in effect on October 31, 2013.

ADR American Depositary Receipt

See notes to financial statements. HSBC PORTFOLIOS        33

HSBC OPPORTUNITY PORTFOLIO

Schedule of Portfolio Investments — as of October 31, 2013

Common Stocks – 96.4%
	Shares	Value ($)
Aerospace & Defense – 3.1%
BE Aerospace, Inc. (a)	46,990	3,813,708
TransDigm Group, Inc.	22,385	3,255,003
		7,068,711
Auto Components – 1.5%
Gentex Corp.	114,150	3,360,576
Biotechnology – 4.9%
ACADIA Pharmaceuticals, Inc. (a)	102,800	2,336,644
Alkermes plc (a)	124,810	4,392,064
Cubist Pharmaceuticals, Inc. (a)	72,520	4,496,240
		11,224,948
Capital Markets – 1.6%
Raymond James Financial, Inc.	77,760	3,549,744
Chemicals – 6.2%
Celanese Corp., Series A	19,010	1,064,750
Cytec Industries, Inc.	35,570	2,955,511
Huntsman Corp.	153,470	3,563,573
Rockwood Holdings, Inc.	42,700	2,700,775
The Scotts Mircale-Gro Co.	63,830	3,748,098
		14,032,707
Commercial Banks – 2.8%
Comerica, Inc.	59,470	2,575,051
First Republic Bank	74,640	3,811,865
		6,386,916
Commercial Services & Supplies – 1.6%
Waste Connections, Inc.	83,135	3,553,190
Communications Equipment – 0.7%
JDS Uniphase Corp. (a)	118,500	1,551,165
Construction Materials – 0.7%
Martin Marietta Materials, Inc.	17,245	1,691,562
Containers & Packaging – 2.7%
Crown Holdings, Inc. (a)	48,790	2,127,244
Packaging Corp. of America	65,400	4,073,112
		6,200,356
Distributors – 1.1%
LKQ Corp. (a)	78,070	2,578,652
Diversified Consumer Services – 1.5%
Service Corp. International	188,540	3,395,605
Electrical Equipment – 2.7%
Generac Holdings, Inc.	43,690	2,156,102
Hubbell, Inc., Class B	36,500	3,925,210
		6,081,312
Electronic Equipment, Instruments & Components – 0.6%
IPG Photonics Corp.	19,110	1,266,420
Energy Equipment & Services – 1.9%
Rowan Cos. plc, Class A(a)	116,860	4,216,309
Health Care Equipment & Supplies – 3.7%
ArthroCare Corp. (a)	61,740	2,311,546
IDEXX Laboratories, Inc. (a)	30,700	3,311,302
Wright Medical Group, Inc. (a)	99,300	2,697,981
		8,320,829
Health Care Providers & Services – 1.9%
Community Health Systems, Inc.	96,490	4,209,859
Health Care Technology – 0.8%
Allscripts Healthcare Solutions, Inc. (a)	134,470	1,859,720
Hotels, Restaurants & Leisure – 1.8%
Arcos Dorados Holdings, Inc., Class A	113,250	1,363,530
Brinker International, Inc.	63,240	2,809,121
		4,172,651
Household Durables – 5.4%
Harman International Industries, Inc.	29,540	2,393,331
Jarden Corp. (a)	70,115	3,881,566
NVR, Inc. (a)	2,427	2,226,336
Taylor Morrison Home Corp., Class A(a)	95,750	2,129,480
Tempur Sealy International, Inc. (a)	44,480	1,705,808
		12,336,521
Insurance – 1.9%
Everest Re Group Ltd.	10,390	1,597,358
Genworth Financial, Inc., Class A(a)	194,860	2,831,316
		4,428,674
Internet Software & Services – 2.6%
MercadoLibre, Inc.	24,020	3,233,933
Pandora Media, Inc. (a)	105,680	2,655,738
		5,889,671
IT Services – 6.9%
Alliance Data Systems Corp. (a)	29,245	6,932,820
FleetCor Technologies, Inc. (a)	29,575	3,411,476
Genpact Ltd. (a)	111,310	2,207,277
Total System Services, Inc.	100,930	3,010,742
		15,562,315
Life Sciences Tools & Services – 3.3%
Covance, Inc. (a)	35,000	3,124,100
Mettler-Toledo International, Inc. (a)	18,120	4,483,975
		7,608,075
Machinery – 2.1%
Lincoln Electric Holdings, Inc.	34,780	2,408,167
The Timken Co.	44,450	2,347,405
		4,755,572
Media – 1.6%
Manchester United plc, Class A(a)	84,360	1,375,068
Nexstar Broadcasting Group, Inc.,
Class A	51,270	2,275,875
		3,650,943

34        HSBC PORTFOLIOS See notes to financial statements.

HSBC OPPORTUNITY PORTFOLIO

Schedule of Portfolio Investments — as of October 31, 2013 (continued)

Common Stocks, continued
	Shares	Value ($)
Oil, Gas & Consumable Fuels – 5.0%
CONSOL Energy, Inc.	72,100	2,631,650
Denbury Resources, Inc. (a)	140,980	2,677,210
Tesoro Corp.	124,510	6,087,294
		11,396,154
Pharmaceuticals – 2.7%
ViroPharma, Inc. (a)	157,970	6,132,395
Professional Services – 2.0%
IHS, Inc., Class A(a)	22,515	2,455,261
Robert Half International, Inc.	56,730	2,185,807
		4,641,068
Real Estate Investment Trusts (REITs) – 1.1%
Starwood Property Trust, Inc.	96,270	2,473,176
Real Estate Management & Development – 1.1%
Jones Lang LaSalle, Inc.	25,440	2,421,888
Road & Rail – 1.3%
Landstar System, Inc.	52,290	2,891,114
Semiconductors & Semiconductor Equipment – 3.0%
Avago Technologies Ltd.	37,670	1,711,348
NXP Semiconductors NV (a)	80,230	3,379,288
Skyworks Solutions, Inc. (a)	66,800	1,722,104
		6,812,740
Software – 3.2%
Concur Technologies, Inc. (a)	21,270	2,224,842
Informatica Corp. (a)	58,240	2,248,064
QLIK Technologies, Inc. (a)	108,820	2,757,499
		7,230,405
Specialty Retail – 8.1%
Best Buy Co., Inc.	118,510	5,072,228
GNC Holdings, Inc., Class A	30,610	1,800,480
Signet Jewelers Ltd.	45,130	3,369,406
Tractor Supply Co.	35,170	2,509,380
Urban Outfitters, Inc. (a)	93,210	3,530,795
Williams-Sonoma, Inc.	42,094	2,207,409
		18,489,698
Trading Companies & Distributors – 3.3%
United Rentals, Inc. (a)	47,670	3,079,005
WESCO International, Inc. (a)	52,080	4,450,757
		7,529,762
TOTAL COMMON STOCKS
(COST $167,155,410)		218,971,403
Investment Companies – 2.9%
Northern Institutional Government
Select Portfolio, Institutional Shares,
0.01% (b)	6,563,134	6,563,134
TOTAL INVESTMENT COMPANIES
(COST $6,563,134)		6,563,134
TOTAL INVESTMENT SECURITIES
(COST $173,718,544) — 99.3%		225,534,537

____________________

Percentages indicated are based on net assets of $227,068,664.
(a)	Represents non-income producing security.
(b)	The rate represents the annualized one-day yield that was in effect on October 31, 2013.

See notes to financial statements. HSBC PORTFOLIOS        35

HSBC PORTFOLIOS

Statements of Assets and Liabilities — as of October 31, 2013

	Growth			Opportunity
	Portfolio			Portfolio
Assets:
Investments in non-affiliates, at value		$	88,353,521		$	225,534,537
Dividends receivable			19,861			32,244
Receivable for investments sold			1,517,261			2,269,970
Prepaid expenses			594			1,339
Total Assets			89,891,237			227,838,090
Liabilities:
Payable for investments purchased			1,134,982			584,366
Accrued expenses and other liabilities:
Investment Management			49,082			150,660
Administration			2,318			5,839
Compliance Services			8			27
Accounting			212			223
Custodian			5,200			6,773
Trustee			83			346
Other			14,886			21,192
Total Liabilities			1,206,771			769,426
Applicable to investors’ beneficial interest		$	88,684,466		$	227,068,664
Total Investments, at cost		$	63,296,090		$	173,718,544

36        HSBC PORTFOLIOS See notes to financial statements.

HSBC PORTFOLIOS

Statements of Operations — For the year ended October 31, 2013

	Growth			Opportunity
	Portfolio			Portfolio
Investment Income:
Dividends		$	975,963		$	1,973,053
Total Investment Income			975,963			1,973,053
Expenses:
Investment Management			472,689			1,486,877
Administration			26,895			58,975
Accounting			44,063			44,249
Compliance Services			719			1,518
Custodian			9,900			13,555
Printing			1,791			4,180
Professional			20,043			25,426
Trustee			2,176			4,700
Other			4,584			9,513
Total Expenses			582,860			1,648,993
Net Investment Income (Loss)			393,103			324,060
Net Realized/Unrealized Gains (Losses) from Investments:
Net realized gains (losses) from investment securities			12,024,769			24,604,589
Change in unrealized appreciation/depreciation on investments			11,744,016			30,628,121
Net realized/unrealized gains (losses) from investments			23,768,785			55,232,710
Change In Net Assets Resulting From Operations		$	24,161,888		$	55,556,770

See notes to financial statements. HSBC PORTFOLIOS        37

HSBC PORTFOLIOS

Statements of Changes in Net Assets

	Growth								Opportunity
	Portfolio								Portfolio
	For the				For the				For the				For the
	year ended				year ended				year ended				year ended
	October 31, 2013				October 31, 2012				October 31, 2013				October 31, 2012
Investment Activities:
Operations:
Net investment income (loss)		$	393,103			$	116,496			$	324,060			$	224,890
Net realized gains (losses) from investments			12,024,769				12,654,581				24,604,589				8,826,465
Change in unrealized appreciation/depreciation
from investments			11,744,016				(6,525,872	)			30,628,121				8,291,618
Change in net assets resulting from operations			24,161,888				6,245,205				55,556,770				17,342,973
Proceeds from contributions			5,010,619				10,142,030				37,719,433				15,884,698
Value of withdrawals			(19,506,375	)			(42,657,788	)			(16,266,064	)			(24,493,548	)
Change in net assets resulting from transactions
in investors’ beneficial interest			(14,495,756	)			(32,515,758	)			21,453,369				(8,608,850	)
Change in net assets			9,666,132				(26,270,553	)			77,010,139				8,734,123
Net Assets:
Beginning of period			79,018,334				105,288,887				150,058,525				141,324,402
End of period		$	88,684,466			$	79,018,334			$	227,068,664			$	150,058,525

38        HSBC PORTFOLIOS See notes to financial statements.

HSBC PORTFOLIOS

Financial Highlights

Selected data for a share outstandingthroughout the periodsindicated.

			Ratios/Supplementary Data
												Ratios of
									Ratio of Net			Expenses
						Ratio of Net			Investment			to Average
			Net Assets at			Expenses to			Income (Loss)			Net Assets
	Total		End of Period			Average Net			to Average Net			(Excluding Fee			Portfolio
	Return		(000’s)			Assets			Assets			Reductions)			Turnover
GROWTH PORTFOLIO
Year Ended October 31, 2009	19.31	%		$	88,163		0.69	%		0.17	%		0.69	%		66	%
Year Ended October 31, 2010	20.34	%		$	98,751		0.68	%		(0.04	)%		0.68	%		89	%
Year Ended October 31, 2011	11.07	%		$	105,289		0.66	%		0.07	%		0.66	%		56	%
Year Ended October 31, 2012	7.18	%		$	79,018		0.71	%		0.13	%		0.71	%		53	%
Year Ended October 31, 2013	32.84	%		$	88,684		0.69	%		0.46	%		0.69	%		75	%
OPPORTUNITY PORTFOLIO
Year Ended October 31, 2009	15.41	%		$	129,748		0.90	%		(0.37	)%		0.90	%		65	%
Year Ended October 31, 2010	28.74	%		$	139,402		0.89	%		(0.35	)%		0.89	%		68	%
Year Ended October 31, 2011	12.40	%		$	141,324		0.88	%		0.05	%		0.88	%		69	%
Year Ended October 31, 2012	12.71	%		$	150,059		0.91	%		0.15	%		0.91	%		59	%
Year Ended October 31, 2013	34.84	%		$	227,069		0.89	%		0.17	%		0.89	%		70	%

See notes to financial statements. HSBC PORTFOLIOS        39

HSBC PORTFOLIOS

Notes to Financial Statements — as of October 31, 2013

1. Organization:

The HSBC Portfolios (the “Portfolio Trust”), is an open-end management investment company organized as a New York trust under the laws of the State of New York on November 1, 1994. The Portfolio Trust contains the following master funds (individually a “Portfolio,” collectively the “Portfolios”):

Portfolio	Short Name
HSBC Growth Portfolio	Growth Portfolio
HSBC Opportunity Portfolio	Opportunity Portfolio

The Portfolios operate as master funds in master-feeder arrangements, in which other funds invest all or part of their investable assets in the Portfolios. The Portfolios also receive investments from funds of funds. The Declaration of Trust permits the Board of Trustees (the “Board”) to issue an unlimited number of beneficial interests in the Portfolios.

The Portfolios are diversified series of the Portfolio Trust and are part of the HSBC Family of Funds, which also includes the HSBC Advisor Funds Trust and HSBC Funds (collectively, the “Trusts”). Financial statements for all other funds of the Trusts are published separately.

Under the Portfolio Trust’s organizational documents, the Portfolio Trust’s officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Portfolios. In addition, in the normal course of business, the Portfolio Trust enters into contracts with its service providers, which also provide for indemnifications by the Portfolios. The Portfolios’ maximum exposure under these arrangements is unknown as this would involve any future claims that may be made against the Portfolios. However, based on experience, the Portfolio Trust expects that risk of loss to be remote.

2. Significant Accounting Policies:

The following is a summary of the significant accounting policies followed by the Portfolios in the preparation of their financial statements. The policies are in conformity with U.S. generally accepted accounting principles (“GAAP”). The preparation of financial statements requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

Securities Valuation:

The Portfolios record their investments at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The valuation techniques used to determine fair value are further described in Note 3 below.

Investment Transactions and Related Income:

Investment transactions are accounted for no later than one business day after trade date. However, for financial reporting purposes, investment transactions are accounted for on trade date. Investment gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date.

Expense Allocations:

Expenses directly attributable to a Portfolio are charged to that Portfolio. Expenses not directly attributable to a Portfolio are allocated proportionally among the applicable portfolios or funds within the Trusts in relation to net assets or on another reasonable basis.

40       HSBC PORTFOLIOS

HSBC PORTFOLIOS

Notes to Financial Statements — as of October 31, 2013 (continued)

Federal Income Taxes:

     Each Portfolio will be treated as a partnership for U.S. federal income tax purposes. Accordingly, each Portfolio passes through all of its net investment income and gains and losses to its feeder funds, and is therefore not subject to U.S. federal income tax. As such, investors in the Portfolios will be taxed on their respective share of the Portfolios’ ordinary income and realized gains. It is intended that the Portfolios will be managed in such a way that an investor will be able to satisfy the requirements of the Internal Revenue Code, as amended, applicable to regulated investment companies.

Management of the Portfolios has reviewed tax positions taken in tax years that remain subject to examination by all major tax jurisdictions, including federal (i.e., the last four tax year ends and the interim tax period since then, as applicable). Management believes that there is no tax liability resulting from unrecognized tax benefits related to uncertain tax positions taken.

New Accounting Pronouncements:

In January 2013, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2013-01 “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities” (“ASU 2013-01”) which amended Accounting Standards Codification Subtopic 210-20, Balance Sheet Offsetting. ASU 2013-01 clarified the scope of ASU No. 2011-11 “Disclosures about Offsetting Assets and Liabilities” (“ASU 2011-11”). ASU 2011-11 requires an entity to disclose information about offsetting and related arrangements to enable users of the financial statements to understand the effect of those arrangements on the entity’s financial position. ASU 2013-01 clarifies the scope of ASU 2011-11 as applying to derivatives accounted for in accordance with Topic 815, Derivatives and Hedging, including bifurcated embedded derivatives, repurchase agreements and reverse repurchase agreements, and securities borrowing and securities lending transactions that are offset either in accordance with other requirements of GAAP or subject to an enforceable master netting arrangement or similar agreement. The guidance in ASU 2013-01 and ASU 2011-11 is effective for interim and annual periods beginning on or after January 1, 2013. Management is evaluating any impact ASU 2013-01 and ASU 2011-11 may have on the Portfolios’ financial statements.

3. Investment Valuation Summary:

The valuation techniques employed by the Portfolios, as described below, maximize the use of observable inputs and minimize the use of unobservable inputs in determining fair value. The inputs used for valuing the Portfolios’ investments are summarized in the three broad levels listed below:

• Level 1: quoted prices in active markets for identical assets
   
• Level 2: other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.)
   
• Level 3: significant unobservable inputs (including a Portfolio’s own assumptions in determining the fair value of investments)

Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The Portfolios determine transfers between fair value hierarchy levels at the reporting period end. The inputs or methodology used for valuing investments are not necessarily an indication of the risk associated with investing in those investments.

Exchange traded, domestic equity securities are valued at the last sale price on a national securities exchange, or in the absence of recorded sales, at the readily available closing bid price on such exchanges, or at the quoted bid price in the over-the-counter market and are typically categorized as Level 1 in the fair value hierarchy.

Shares of exchange traded and closed-end registered investment companies are valued in the same manner as other equity securities and are typically categorized as Level 1 in the fair value hierarchy. Mutual funds are valued at their net asset values, as reported by such companies and are typically categorized as Level 1 in the fair value hierarchy.

HSBC PORTFOLIOS       41

HSBC PORTFOLIOS

Notes to Financial Statements — as of October 31, 2013 (continued)

     Repurchase agreements are valued at original cost and are typically categorized as Level 2 in the fair value hierarchy.

Securities or other assets for which market quotations are not readily available, or are deemed unreliable due to a significant event or otherwise, are valued pursuant to procedures adopted by the Trusts’ Board (“Procedures”). Depending on the source and relative significance of valuation inputs, these instruments may be classified as Level 2 or Level 3 in the fair value hierarchy. Examples of potentially significant events that could affect the value of an individual security and thus require pricing under the Procedures include corporate actions by the issuer, announcements by the issuer relating to its earnings or products, regulatory news, natural disasters, and litigation. Examples of potentially significant events that could affect multiple securities held by a Portfolio include governmental actions, natural disasters, and armed conflicts. Fair value pricing may require subjective determinations about the value of a security. While the Portfolio Trust’s policy is intended to result in a calculation of a Portfolio’s net asset value that fairly reflects security values as of the time of pricing, the Portfolio Trust cannot ensure that fair values determined would accurately reflect the price that a Portfolio could obtain for a security if it were to dispose of that security as of the time of pricing. The prices used by a Portfolio may differ from the value that would be realized if the securities were sold and the differences could be material to the financial statements.

For the year ended October 31, 2013, there were no Level 3 investments for which significant unobservable inputs were used to determine fair value.

The following is a summary of the valuation inputs used as of October 31, 2013 in valuing the Portfolios’ investments based upon the three levels defined above. The breakdown of investment categorization is disclosed in the Schedule of Portfolio Investments for each Portfolio:

	LEVEL 1 ($)	LEVEL 2 ($)	LEVEL 3 ($)	Total ($)
Growth Portfolio
Investment Securities:
Common Stocks	87,746,575	—	—	87,746,575
Investment Companies	606,946	—	—	606,946
Total Investment Securities	88,353,521	—	—	88,353,521
Opportunity Portfolio
Investment Securities:
Common Stocks	218,971,403	—	—	218,971,403
Investment Companies	6,563,134	—	—	6,563,134
Total Investment Securities	225,534,537	—	—	225,534,537

4. Related Party Transactions and Other Agreements:

Investment Management:

HSBC Global Asset Management (USA) Inc. (“HSBC” or the “Investment Adviser”), a wholly owned subsidiary of HSBC Bank USA, N.A., a national bank organized under the laws of the United States, acts as the Investment Adviser to the Portfolios pursuant to an investment management contract with the Portfolio Trust. As Investment Adviser, HSBC manages the investments of the Portfolios and continuously reviews, supervises, and administers the Portfolios’ investments. Winslow Capital Management, LLC (“Winslow”) and Westfield Capital Management Company, L.P. (“Westfield”) serve as subadvisers for the Growth Portfolio and Opportunity Portfolio, respectively, and are paid for their services directly by the respective Portfolios.

42       HSBC PORTFOLIOS

HSBC PORTFOLIOS

Notes to Financial Statements — as of October 31, 2013 (continued)

     For their services, the Investment Adviser and Winslow receive in aggregate, from the Growth Portfolio, a fee, accrued daily and paid monthly, at an annual rate of:

Based on Average Daily Net Assets of all Sub-Adviser serviced funds and separate accounts affiliated
with HSBC:	Fee Rate(%)*
Up to $250 million	0.575
In excess of $250 million but not exceeding $500 million	0.525
In excess of $500 million but not exceeding $750 million	0.475
In excess of $750 million but not exceeding $1 billion	0.425
In excess of $1 billion	0.375

____________________
 

* The Growth Portfolio may pay the Investment Adviser and Winslow an aggregate maximum fee of up to 0.68%. Currently, the Investment Adviser’s contractual fee is 0.175% and Winslow’s maximum contractual fee is 0.40%. Accordingly, the current aggregate maximum fee rate is 0.575%.

For their services, the Investment Adviser and Westfield receive in aggregate, a fee, accrued daily and paid monthly, at an annual rate of 0.80% of the Opportunity Portfolio’s average daily net assets.

Administration:

HSBC serves the Portfolios as Administrator. Under the terms of the Administration Agreement, HSBC receives from the Portfolios (as well as other funds in the Trusts combined) a fee, accrued daily and paid monthly at an annual rate of:

Based on Combined Average Daily Net Assets of	Fee Rate(%)
Up to $10 billion	0.0550
In excess of $10 billion but not exceeding $20 billion	0.0350
In excess of $20 billion but not exceeding $50 billion	0.0275
In excess of $50 billion	0.0250

The fee rates and breakpoints are determined on the basis of the aggregate average daily net assets of the Trusts, however, the assets of the funds of the HSBC Funds and HSBC Advisor Funds Trust that invest in the Portfolios are not double-counted. The total administration fee paid to HSBC is allocated to each series based upon its proportionate share of the aggregate net assets of the Trusts. For assets invested in the Portfolios by the funds of the HSBC Funds and HSBC Advisor Funds Trust, the Portfolios pay half of the administration fee and the other funds pay half of the administration fee, for a combination of the total fee rate set forth above.

Pursuant to a Sub-Administration Agreement with HSBC, Citi Fund Services Ohio, Inc. (“Citi”), a wholly-owned subsidiary of Citigroup, Inc., serves as the Trusts’ Sub-Administrator subject to the general supervision by the Trusts’ Board and HSBC. For these services, Citi is entitled to a fee, payable by HSBC, at an annual rate equivalent to the fee rates set forth above subject to certain reductions associated with services provided to new portfolios, minus 0.02% which is retained by HSBC.

Under a Compliance Services Agreement between the Trusts and Citi (the “CCO Agreement”), Citi makes an employee available to serve as the Trusts’ Chief Compliance Officer (the “CCO”). Under the CCO Agreement, Citi also provides infrastructure and support in implementing the written policies and procedures comprising the Trusts’ compliance program, including support services to the CCO. For the services provided under the CCO Agreement, the Trusts paid Citi $287,560 for the year ended October 31, 2013, plus reimbursement of certain out of pocket expenses. Expenses incurred by each Portfolio are reflected on the Statements of Operations as “Compliance Services.” Citi pays the salary and other compensation earned by individuals performing these services, as employees of Citi.

Fund Accounting:

Citi provides fund accounting services for the Portfolio Trust. For its services to the Portfolios, Citi receives an annual fee per portfolio, including reimbursement of certain expenses, that is accrued daily and paid monthly.

HSBC PORTFOLIOS       43

HSBC PORTFOLIOS

Notes to Financial Statements — as of October 31, 2013 (continued)

Independent Trustees:

     The Trusts pay each Independent Trustee an annual retainer of $100,000. The Trusts pay a fee of $10,000 for each regular meeting of the Board attended and a fee of $ 3,000 for each special meeting attended. The Trusts pay each Committee Chair an annual retainer of $ 3,000, with the exception of the Chair of the Audit Committee, who receives a retainer of $ 6,000. The Trusts also pay the Chairman of the Boardan additional annual retainer of $24,000. In addition, for time expended on Board duties outside normal meetings, which is authorized by the Board, a Trustee is compensated at the rate of $ 500 per hour, up to a maximum of $ 3,000 per day.

5. Investment Transactions:

Cost of purchases and proceeds from sales of securities (excluding securities maturing less than one year from acquisition) for the year ended October 31, 2013 were as follow:

	Purchases ($)	Sales ($)
Growth Portfolio	62,055,996	74,114,396
Opportunity Portfolio	144,039,393	126,127,698

For the year ended October 31, 2013, there were no long-term U.S. government securities held by the Portfolio Trust.

6. Federal Income Tax Information:

At October 31, 2013, the cost basis of securities for federal income tax purposes, gross unrealized appreciation, gross unrealized depreciation and net unrealized appreciation/depreciation were as follows:

						Net Unrealized
		Tax Unrealized	Tax Unrealized			Appreciation/
	Tax Cost ($)	Appreciation ($)	Depreciation ($)			(Depreciation) ($)*
Growth Portfolio	59,903,953	28,711,719		(262,151	)	28,449,568
Opportunity Portfolio	174,027,654	53,521,776		(2,014,893	)	51,506,883

____________________
 

* The difference between book-basis unrealized appreciation (depreciation) is attributable primarily to tax deferral of losses on wash sales.

7. Subsequent Events:

Management has evaluated events and transactions through the date the financial statements were issued, for purposes of recognition or disclosure in these financial statements and there are no subsequent events to report.

44       HSBC PORTFOLIOS

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Trustees of
HSBC Portfolios:

We have audited the accompanying statements of assets and liabilities of HSBC Portfolios – HSBC Growth Portfolio and HSBC Opportunity Portfolio (the Funds), including the schedules of portfolio investments, as of October 31, 2013, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period then ended. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the auditto obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of October 31, 2013, by correspondence with custodians and brokers or by other appropriate auditing procedures. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Funds as of October 31, 2013, the results of their operations for the year then ended, the changes in their net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period then ended, in conformity with U.S. generally accepted accounting principles.

Columbus, Ohio
December 27, 2013

HSBC PORTFOLIOS       45

HSBC PORTFOLIOS

Table of Shareholder Expenses — as of October 31, 2013 (Unaudited)

     As a shareholder of the Portfolios, you incur ongoing costs, including management fees and other Fund expenses.

These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Portfolios and to compare these costs with the ongoing costs of investing in other mutual funds.

These examples are based on an investment of $1,000 invested at the beginning of the period and held for the entire period from May 1, 2013 through October 31, 2013.

Actual Example

The table below provides information about actual account values and actual expenses. You may use the information below, 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 table under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

										Annualized
	Beginning			Ending			Expenses Paid			Expense Ratio
	Account Value			Account Value			During Period*			During Period
	5/1/13			10/31/13			5/1/13 - 10/31/13			5/1/13 - 10/31/13
Growth Portfolio		$	1,000.00		$	1,170.40		$	3.61		0.66	%
Opportunity Portfolio			1,000.00			1,139.50			4.75		0.88	%

Hypothetical Example for Comparison Purposes

The table below provides information about hypothetical account values and hypothetical expenses based on each Portfolio’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Portfolio’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 this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

										Annualized
	Beginning			Ending			Expenses Paid			Expense Ratio
	Account Value			Account Value			During Period*			During Period
	5/1/13			10/31/13			5/1/13 - 10/31/13			5/1/13 - 10/31/13
Growth Portfolio		$	1,000.00		$	1,021.88		$	3.36		0.66	%
Opportunity Portfolio			1,000.00			1,020.77			4.48		0.88	%

____________________
 

* Expenses are equal to the average account value over the period, multiplied by the Portfolio's annualized expense ratio, multiplied by 184/365 (to reflect the one half year period).

46       HSBC PORTFOLIOS

HSBC PORTFOLIOS

Board of Trustees and Officers (Unaudited)

MANAGEMENT OF THE TRUST

     The following table contains information regarding the HSBC Family of Funds’ Board of Trustees (“Trustees”). Asterisks indicate those Trustees who are “interested persons,” as defined in the Investment Company Act of 1940, as amended, of the HSBC Family of Funds. The HSBC Family of Funds’ Statement of Additional Information includes additional information about the Trustees and is available, without charge, upon request by calling (888) 525-5757.

				Portfolios in
	Position(s)	Term of Office		Fund Complex	Other
Name,	Held with	and Length of	Principal Occupation(s)	Overseen By	Directorships
Address, Age	Funds	Time Served	During Past 5 Years	Trustee*	Held by Trustee
NON-INTERESTED
TRUSTEES
MARCIA L. BECK P.O. Box 182845 Columbus, OH 43218-3035 Age: 58	Trustee	Indefinite; 2008 to present	Private Investor (June 1999 – present); Executive Vice President, Prudential Investments (1997 – 1999); President and Trustee, The Goldman Sachs Mutual Funds (1992 – 1996)	21	None
SUSAN C. GAUSE P.O. Box 182845 Columbus, OH 43218-3035 Age: 60	Trustee	Indefinite; 2013 to present	Since 2003, Private Investor; Independent Trustee of Met Investors Series Trust (2008-2012); Chief Executive Officer, Dresdner RCM Global Investors and Allianz Dresdner Asset Management (2000-2002); Board Member of Dresdner Global Asset Management Board (2000-2002); Chief Operating Officer and Senior Managing Director of Dresdner RCM Global Investors (1998-2000)	21	Since 2012, Trustee, Metropolitan Series Fund
SUSAN S. HUANG P.O. Box 182845 Columbus, OH 43218-3035 Age: 59	Trustee	Indefinite; 2008 to present	Private Investor (2000- present); Senior Vice President, Schroder Investment Management (2001 – 2004); Managing Director, Chase Asset Management (1995-2000)	21	None
ALAN S. PARSOW P.O. Box 182845 Columbus, OH 43218-3035 Age: 63	Trustee	Indefinite; 1987 to present	General Partner, Elkhorn Partners, L.P. (a private investment partnership) (1989 – present)	21	None
THOMAS F. ROBARDS P.O. Box 182845 Columbus, OH 43218-3035 Age: 67	Trustee	Indefinite; 2005 to present	Partner, Robards & Co. LLC (investment and advisory services) (2005-present); Chief Financial Officer, American Museum of Natural History (2003- 2004); Chief Financial Officer, Datek Online Holdings (2000-2003); Previously EVP and CFO Republic New York Corporation	21	Overseas Shipholding Group (energy transportation); Ellington Financial LLC (NYSE listed financial services); Ellington Residential Mortgage REIT (NYSE listed real estate investment trust)
MICHAEL SEELY P.O. Box 182845 Columbus, OH 43218-3035 Age: 68	Chairman and Trustee	Indefinite; 1987 to present	Private Investor (2003-present); General Partner, Global Multi Manager Partners (1999-2003); President of Investor Access Corporation (1981-2003)	21	None
INTERESTED TRUSTEE
DEBORAH HAZELL 452 Fifth Avenue New York NY 10018 Age: 50	Trustee	Indefinite; 2011 to present	CEO, HSBC Global Asset Management (USA) Inc. (2011-present); President and CEO, Fisher Francis Trees & Watts (“FFTW”) (investment advisor), February 2008-June 2011; Head of Client Service, Business Development and Marketing Group, FFTW (October 1999-February 2008)	21	None

____________________
 

* Includes the Trust, the HSBC Advisor Fund Trust and the HSBC Portfolios.

HSBC PORTFOLIOS       47

HSBC PORTFOLIOS

Board of Trustees and Officers (Unaudited) (continued)

	Position(s) Held	Term of Office and	Principal Occupation(s)
Name, Address, Age	with Funds	Length of Time Served	During Past 5 Years
OFFICERS
RICHARD A. FABIETTI 452 Fifth Avenue New York, NY 10018 Age: 55	President	One year; 2004 to present	Senior Vice President, Head of Product Management, HSBC Global Asset Management (USA) Inc. (1998 - present)
STEPHEN SIVILLO 452 Fifth Avenue New York, NY 10018 Age: 42	Vice President	One year; 2010 to present	Vice President of Product Administration, HSBC Global Asset Management (USA) Inc. (2010 - present); Chief Compliance Officer, Managers Funds (2009 – 2010); Director, Mutual Fund Compliance, AllianceBernstein (2007-2009)
TY EDWARDS* 3435 Stelzer Road Columbus, OH 43219-3035 Age: 47	Treasurer	One year; 2010 to present	Senior Vice President, Citi Fund Services (2010– present); Director, Product Management, Columbia Management (2007-2009); Deputy Treasurer, Columbia Funds, (2006-2007)
JENNIFER A. ENGLISH* 100 Summer Street Suite 1500 Boston, MA 02110 Age: 41	Secretary	One year; 2008 to present	Senior Vice President, Regulatory Administration, Citi (2005 - present)
FREDERICK J. SCHMIDT* 1 Rexcorp Plaza Uniondale, NY 11556 Age: 54	Chief Compliance Officer	One year; 2004 to present	Director and Chief Compliance Officer, CCO Services, Citi (2004 - present)

____________________
 

* Mr. Edwards, Mr. Schmidt, and Ms. English also are officers of other investment companies of which Citi (or an affiliate) is the administrator or sub-administrator.

48       HSBC PORTFOLIOS

     Other Information (Unaudited):

     Information regarding how the Funds voted proxies relating to portfolio securities during the most recent 12-month period ended June 30th is available (i) without charge, upon request, by calling 1-800-525-5757 for HSBC Bank USA and HSBC Brokerage (USA) Inc. clients and 1-800-782-8183 for all other shareholders; (ii) on the Funds’ website at www.investorfunds.us.hsbc.com; and (iii) on the Security and Exchange Commission’s (“Commission”) website at http://www.sec.gov.

The Funds file their complete schedules of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Funds’ Forms N-Q are available on the Commission’s website at http://www.sec.gov. The Funds’ Forms N-Q may be reviewed and copied at the Commission’s Public Reference Room in Washington, D.C. and information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. The Funds’ Schedules of Investments will be available no later than 60 days after each period end, without charge, on the Funds’ website at www.investorfunds.us.hsbc.com.

An investment in a Fund is not a deposit of HSBC Bank USA, National Association, and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency.

HSBC PORTFOLIOS       49

HSBC FAMILY OF FUNDS: INVESTMENT ADVISER AND ADMINISTRATOR HSBC Global Asset Management (USA) Inc.
452 Fifth Avenue
New York, NY 10018 SUB-ADVISERS HSBC Growth Portfolio
Winslow Capital Management, LLC
4720 IDS Tower
80 South Eighth Street
Minneapolis, MN 55402 HSBC Opportunity Portfolio
Westfield Capital Management Company, L.P.
One Financial Center
Boston, MA 02111 SHAREHOLDER SERVICING AGENTS For HSBC Bank USA, N.A. and
HSBC Securities (USA) Inc. Clients HSBC Bank USA, N.A.
452 Fifth Avenue
New York, NY 10018
1-888-525-5757 For All Other Shareholders HSBC Funds
P.O. Box 182845
Columbus, OH 43218
1-800-782-8183 TRANSFER AGENT Citi Fund Services
3435 Stelzer Road
Columbus, OH 43219 DISTRIBUTOR Foreside Distribution Services, L.P.
690 Taylor Road, Suite 150
Gahanna, OH 43230 CUSTODIAN The Northern Trust Company
50 South LaSalle Street
Chicago, IL 60603 INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM KPMG LLP
191 West Nationwide Blvd., Suite 500
Columbus, OH 43215 LEGAL COUNSEL Dechert LLP
1900 K Street, N.W.
Washington, D.C. 20006

 

Investment products:
ARE NOT A BANK DEPOSIT OR OBLIGATION OF THE BANK OR ANY OF ITS AFFILIATES	ARE NOT FDIC INSURED	ARE NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY
ARE NOT GUARANTEED BY THE BANK OR ANY OF ITS AFFILIATES		MAY LOSE VALUE

Investment products are offered by HSBC Securities (USA) Inc. (HSI), member NYSE/FINRA/SIPC. HSI is an affiliate of HSBC Bank USA, N.A. Investment products: Are not a deposit or other obligation of the bank or any of its affiliates; Not FDIC insured or insured by any federal government agency of the United States; Not guaranteed by the bank or any of its affiliates; and are subject to investment risk, including possible loss of principal invested.

HSB-AR-RTL-1213 12/13

Item 2. Code of Ethics.

(a) The registrant has adopted a code of ethics that applies to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. This code of ethics is included as an Exhibit.

(b) During the period covered by the report, with respect to the registrant's code of ethics that applies to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions; there have been no amendments to, nor any waivers granted from, a provision that relates to any element of the code of ethics definition enumerated in paragraph (b) of this Item 2.

Item 3. Audit Committee Financial Expert.

3(a)(1) The registrant’s board of directors has determined that the registrant has at least one audit committee financial expert serving on its audit committee.

3(a)(2) The audit committee financial expert is Thomas Robards, who is “independent” for purposes of this Item 3 of Form N-CSR.

Item 4. Principal Accountant Fees and Services.

(a) Audit Fees,
2012       $184,855
2013       $176,323

(b) Audit-Related Fees,
2012       $5,950
2013       $5,833

2012 – Fees of $5,950 relate to the consent of N-1A filing.
2013 – Fees of $5,833 relate to the consent of N-1A filing.

(c) Tax Fees,
2012       $110,130
2013       $101,875

Fees for both 2012 and 2013 relate to the preparation of federal income and excise tax returns and the review of excise tax distributions.

(d) All Other Fees,
2012       $ 0
2013       $ 0

(e)(1) The audit committee is required to pre-approve all audit and permitted non-audit services performed by the registrant’s independent auditors in accordance with the audit committee charter and the Investment Company Act of 1940.

(e)(2)

2012       0%
2013       0%

      (f) Not applicable.

(g) Non-Audit Fees.
2012       $116,080
2013       $107,708

(h) The audit committee considered the nonaudit services rendered to the registrant’s investment adviser and any entity controlling, controlled by, or under common control with the investment adviser, and believes the services are compatible with the principal accountant’s independence.

Item 5. Audit Committee of Listed Registrants.

Not applicable.

Item 6. Investments.

(a) Included as a part of the report to shareholders filed under Item 1.
(b) Not applicable.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Not applicable.

Item 8. Portfolio Managers of Closed-End Management Investment Companies.

Not applicable.

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

Not applicable.

Item 10. Submission of Matters to a Vote of Security Holders.

Not applicable.

Item 11. Controls and Procedures.

(a)The registrant’s principal executive officer and principal financial officer have concluded, based on their evaluation of the registrant's disclosure controls and procedures as conducted within 90 days of the filing date of this report, that these disclosure controls and procedures are adequately designed and are operating effectively to ensure that information required to be disclosed by the registrant on Form N-CSR is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms.

(b)There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Act (17 CFR 270.30a-3(d)) that occurred during the second fiscal quarter of the period covered by this report that have materially affected or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Item 12. Exhibits.

(a)(1) The code of ethics that is the subject of the disclosure required by Item 2 is attached hereto.

(a)(2) Certifications pursuant to Rule 30a-2(a) are attached hereto.

(a)(3) Not applicable.

(b) Certifications pursuant to Rule 30a-2(b) are furnished herewith.

SIGNATURES

       Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

(Registrant)          HSBC FUNDS

By (Signature and Title)	/s/ Richard A. Fabietti
	Richard A. Fabietti
	President

Date 12/23/13

       Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By (Signature and Title)	/s/ Richard A. Fabietti
	Richard A. Fabietti
	President

Date 12/23/13

By (Signature and Title)	/s/ Ty Edwards
	Ty Edwards
	Treasurer

Date 12/23/13