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 | 811-05476 | |||||||
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LORD ABBETT GLOBAL FUND, INC. | ||||||||
(Exact name of registrant as specified in charter) | ||||||||
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90 Hudson Street, Jersey City, NJ |
| 07302 | ||||||
(Address of principal executive offices) |
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Thomas R. Phillips, Esq., Vice President & Assistant Secretary 90 Hudson Street, Jersey City, NJ 07302 | ||||||||
(Name and address of agent for service) | ||||||||
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Registrant’s telephone number, including area code: | (800) 201-6984 |
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Date of fiscal year end: | 12/31 |
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Date of reporting period: | 6/30/2008 |
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Item 1: Report to Shareholders.
2008
LORD ABBETT SEMIANNUAL REPORT
Lord Abbett
Global Allocation Fund*
Developing Local Markets Fund
For the six-month period ended June 30, 2008
* Formerly known as Global Equity Fund
Lord Abbett Global Allocation Fund and
Lord Abbett Developing Local Markets Fund
Semiannual Report
For the six-month period ended June 30, 2008
Dear Shareholders: We are pleased to provide you with this overview of the performance of the Lord Abbett Global Allocation Fund (formerly, the Lord Abbett Global Equity Fund) and the Lord Abbett Developing Local Markets Fund for the six-month period ended June 30, 2008. On this and the following pages, we discuss the major factors that influenced performance. For detailed and more timely information about the Funds, please visit our Website at www.lordabbett.com, where you also can access the quarterly commentaries of the Funds' portfolio managers.
General information about Lord Abbett mutual funds, as well as in-depth discussion of market trends and investment strategies, is also provided in Lord Abbett Insights, a newsletter accompanying your quarterly account statements. We also encourage you to call Lord Abbett at 888-522-2388 and speak to one of our professionals if you would like more information.
Thank you for investing in Lord Abbett mutual funds. We value the trust that you place in us and look forward to serving your investment needs in the years to come.
Best regards,
Robert S. Dow
Chairman
From left to right: Robert S. Dow, Director and Chairman of the Lord Abbett Funds; E. Thayer Bigelow, Independent Lead Director of the Lord Abbett Funds; and Daria L. Foster, Director and President of the Lord Abbett Funds.
Q: What were the overall market conditions during the six-month period ended June 30, 2008?
A: The first half of the year was turbulent for equity markets, which generally trended lower. The second quarter began on a positive note amid hopes that the worst of the credit crunch was over. But as evidence increasingly indicated otherwise, the markets turned downward – and stayed that way. The S&P 500® Index1 was down 11.91% for the six-month period.
The ongoing credit crunch that began a year ago continued to have a visible impact on the broader economy. Consumers and businesses found it increasingly difficult to
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access credit at a time when costs were rising and revenues slowing. Consumer confidence plummeted against a backdrop of rising unemployment, falling home values, rising mortgage delinquencies, and soaring prices on everything from energy to orange juice. Inflation concerns continued to plague the markets. The dollar remained weak, which hurt consumers, but boosted exports, which helped sustain the slow pace of growth.
Most U.S. equity asset classes and investment styles returned negative results for the first half of the year. Mid cap stocks (as measured by the Russell Midcap® Index2) generally performed better than small caps (as measured by the Russell 2000® Index3) and large caps (as measured by the Russell 1000® Index4), which performed the worst. Growth stocks generally outperformed value stocks for the six-month period.
International equity markets declined in the six-month period ended June 30, 2008. The MSCI EAFE® Index5 with Gross Dividends (primarily a large company index) declined 10.58%. The MSCI World ex-U.S. Index6 with Net Dividends fell 9.76%, a milder drop than the U.S. equity markets, as measured by the S&P 500 Index, which declined 11.91%. Emerging markets, as measured by the MSCI Emerging Markets Index,7 fell 11.76%, with the biggest declines occurring in India, Turkey, the Philippines, and China. Against that backdrop, oil prices jumped 50.7%, to $140.00 a barrel, from $92.92, while gold rose 11.0%, to $925.40 an ounce, from $833.92 at the end of December 2007. In terms of country performance, the hardest hit markets in the MSCI EAFE Index were New Zealand, Greece, and Portugal, down 26.94%, 26.74%, and 25.37%, respectively. Canada and Norway were the only countries to show gains. As for sector performance, the biggest laggards in the MSCI EAFE Index included financials, consumer discretionary, and telecommunication services. The telecommunication services sector was de-rated by a number of analysts during the period. On the positive side, materials and energy were the only sectors to finish in positive territory.
Foreign currencies continued to gain strength against the U.S. dollar, which reached new lows in March and April (as measured by the U.S. Federal Reserve Board's (the Fed) trade-weighted dollar index of leading currencies). The dollar rebounded in May and June, relative to the major currencies represented by the Americas and Pacific subindexes of the Fed's trade-weighted dollar index.
Lord Abbett Global Allocation Fund (formerly, the Lord Abbett Global Equity Fund)
Prior to July 1, 2008, the Lord Abbett Global Allocation Fund was known as the
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Lord Abbett Global Equity Fund. Performance commentary in this report reflects the Global Allocation Fund's investment objective and investment strategy prior to July 1, 2008, at which time the Fund implemented its present global allocation strategy. For more information, please see the Global Allocation Fund's prospectus.
Q: How did the Global Allocation Fund perform during the six-month period ended June 30, 2008?
A: The Fund returned -11.27%, reflecting performance at the net asset value (NAV) of Class A shares with all distributions reinvested, compared to its benchmark, the MSCI World® Index with Gross Dividends,8 which returned -10.25% over the same period.
Q: What were the most significant factors affecting performance?
A: The greatest detractors from the Fund's performance relative to its benchmark for the six-month period were the energy sector (primarily owing to an underweight position), the telecommunication services sector, and the industrials sector.
Among individual holdings that detracted from performance were financials holding National Bank of Greece S.A. (the Fund's number-one detractor), an international provider of retail and corporate banking services; information technology holding Nokia Corp., a telecommunications company primarily focused on the manufacturing and global sales of mobile handsets; and industrials holding General Electric Co., a provider of jet engines, power plant turbines, locomotives, medical imaging equipment, and private label credit cards.
The greatest contributors to the Fund's performance relative to the benchmark were the healthcare, information technology, and consumer staples sectors.
Among individual holdings that contributed to performance were materials holding Monsanto Co. (the Fund's number-one contributor), a provider of technology-based solutions and agricultural products for growers and downstream customers in the agricultural markets; information technology holding Activision, Inc., a publisher of interactive entertainment software; and healthcare holding Celgene Corp., a global biopharmaceutical company.
The Fund's portfolio is actively managed and, therefore, its holdings and weightings of a particular issuer or particular sector as a percentage of portfolio assets are subject to change. Sectors may include many industries.
Lord Abbett Developing Local Markets Fund
Q: How did the Developing Local Markets Fund perform during the six-month period ended June 30, 2008?
A: The Fund returned 7.55%, reflecting performance at the net asset value (NAV) of Class A shares with all distributions
3
reinvested, compared to its benchmark, the JPMorgan Emerging Local Markets Index Plus (ELMI+),9 which returned 8.75% over the same period.
Q: What were the most significant factors affecting performance?
A: Detracting from performance relative to the portfolio's benchmark were the portfolio's underweights in currencies of eastern and central European countries (Hungary, Slovakia, Czech Republic) that are EU members, whose currencies are closely linked to the euro, which appreciated versus the U.S. dollar. Also detracting from performance was an overweight in the currencies of India and the Philippines, which are heavy importers of energy and agricultural products.
Contributing to performance relative to its benchmark was the portfolio's overweight position in the currencies of Russia and Brazil, which are commodity-exporting countries that also raised interest rates. Also contributing to performance relative to the benchmark was the portfolio's underweight position in the currencies of Chile, Peru, and Colombia – nations which failed to control inflation. The portfolio's underweight of the South African rand helped performance, as the rand declined amid political turmoil in the country.
The Fund's portfolio is actively managed and, therefore, its holdings and the weightings of a particular issuer or particular sector as a percentage of portfolio assets are subject to change. Sectors may include many industries.
A prospectus contains important information about a fund, including its investment objectives, risks, charges, and ongoing expenses, which an investor should carefully consider before investing. To obtain a prospectus on any Lord Abbett mutual fund, please contact your investment professional or Lord Abbett Distributor LLC at 888-522-2388 or visit our Website at www.lordabbett.com. Read the prospectus carefully before investing.
1 The S&P 500® Index is widely regarded as the standard for measuring large-cap U.S. stock market performance and includes a representative sample of leading companies in leading industries.
2 The Russell Midcap® Index measures the performance of the 800 smallest companies in the Russell 1000 Index, which represent approximately 31% of the total market capitalization of the Russell 1000 Index.
3 The Russell 2000® Index measures the performance of the 2000 smallest companies in the Russell 3000® Index.
4 The Russell 1000® Index is a capitalization-weighted price-only index which is comprised of 1000 of the largest capitalized US-domiciled companies whose common stock trades in the United States on the New York Stock Exchange, American Stock Exchange and Nasdaq and which are included in the Russell 3000® Index. This large cap market-oriented Index is highly correlated with the S&P 500 Index.
5 The MSCI EAFE® Index with Gross Dividends is an unmanaged index that reflects the stock markets of 21 countries, including Europe, Australasia, and the Far East, with values expressed in U.S. dollars. The MSCI EAFE Index with Gross Dividends approximates the maximum possible dividend reinvestment. The amount reinvested is the entire dividend distributed to individuals resident in the country of the company, but does not include tax credits.
6 The MSCI World ex-U.S. Index with Net Dividends is a free float-adjusted market capitalization weighted
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index that is designed to measure the equity market performance of developed markets. As of June 2007 the MSCI World ex-U.S. with Net Dividends Index consisted of the following 23 developed market country indexes: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Greece, Hong Kong, Ireland, Italy, Japan, Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, the United Kingdom and the United States. The MSCI World ex-U.S. Index with Net Dividends Index approximates the minimum possible dividend reinvestment. The dividend is reinvested after deduction of withholding tax, applying the rate to nonresident individuals who do not benefit from double taxation treaties. MSCI uses withholding tax rates applicable to Luxembourg holding companies, as Luxembourg applies the highest rates.
7 The MSCI Emerging Markets Index is a free float-adjusted market capitalization index that is designed to measure equity market performance in the global emerging markets. As of June 2007, the MSCI Emerging Markets Index consisted of the following 25 emerging market country indexes: Argentina, Brazil, Chile, China, Colombia, Czech Republic, Egypt, Hungary, India, Indonesia, Israel, Jordan, Korea, Malaysia, Mexico, Morocco, Pakistan, Peru, Philippines, Poland, Russia, South Africa, Taiwan, Thailand, and Turkey.
8 The MSCI World® Index with Gross Dividends is an unmanaged capitalization index representing the industry composition and a sampling of small, medium and large capitalization companies from global markets. It is a Morgan Stanley International Index that includes stocks traded on 23 exchanges in Europe, Australasia, and the Far East. The MSCI World Index with Gross Dividends approximates the maximum possible dividend reinvestment. The amount reinvested is the entire dividend distributed to individuals resident in the country of the company, but does not include tax credits.
9 The JPMorgan Emerging Local Markets Index Plus tracks total returns for local-denominated money-market instruments.
Indexes are unmanaged, do not reflect the deduction of fees or expenses, and are not available for direct investment.
Important Performance and Other Information
Performance data quoted reflect past performance and are no guarantee of future results. Current performance may be higher or lower than the performance quoted. The investment return and principal value of an investment in the Funds will fluctuate so that shares, on any given day or when redeemed, may be worth more or less than their original cost. You can obtain performance data current to the most recent month-end by calling Lord Abbett at 888-522-2388 or referring to our Website at www.lordabbett.com.
Except where noted, comparative Fund performance does not account for the deduction of sales charges and would be different if sales charges were included. The Funds offer several classes of shares with distinct pricing options. For a full description of the differences in pricing alternatives, please see the Funds' prospectuses.
During the period covered by this report, expense reimbursements were in place. Without such expense reimbursements, the Funds' returns would have been lower.
The views of the Funds' management and the portfolio holdings described in this report are as of June 30, 2008; these views and portfolio holdings may have changed subsequent to this date, and they do not guarantee the future performance of the markets or the Funds. Information provided in this report should not be considered a recommendation to purchase or sell securities.
A Note about Risk: See Notes to Financial Statements for a discussion of investment risks. For a more detailed discussion of the risks associated with the Funds, please see the Funds' prospectuses.
Mutual funds are not insured by the FDIC, are not deposits or other obligations of, or guaranteed by banks, and are subject to investment risks including possible loss of principal amount invested.
5
Expense Example
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, including sales charges on purchase payments (these charges vary among the share classes); and (2) ongoing costs, including management fees; distribution and service (12b-1) fees (these charges vary among the share classes); and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in each Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (January 1, 2008 through June 30, 2008).
Actual Expenses
For each class of each Fund, the first line of the table on the following pages provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During the Period 1/1/08 – 6/30/08" to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
For each class of each Fund, the second line of the table on the following pages provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in each Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
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Global Allocation Fund (formerly, Global Equity Fund)
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. Therefore, the second line of 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.
Beginning Account Value | Ending Account Value | Expenses Paid During Period† | |||||||||||||
1/1/08 | 6/30/08 | 1/1/08 – 6/30/08 | |||||||||||||
Class A* | |||||||||||||||
Actual | $ | 1,000.00 | $ | 887.30 | $ | 7.51 | |||||||||
Hypothetical (5% Return Before Expenses) | $ | 1,000.00 | $ | 1,016.89 | $ | 8.02 | |||||||||
Class B* | |||||||||||||||
Actual | $ | 1,000.00 | $ | 884.80 | $ | 10.54 | |||||||||
Hypothetical (5% Return Before Expenses) | $ | 1,000.00 | $ | 1,013.65 | $ | 11.26 | |||||||||
Class C* | |||||||||||||||
Actual | $ | 1,000.00 | $ | 884.20 | $ | 10.54 | |||||||||
Hypothetical (5% Return Before Expenses) | $ | 1,000.00 | $ | 1,013.65 | $ | 11.26 | |||||||||
Class F* | |||||||||||||||
Actual | $ | 1,000.00 | $ | 889.40 | $ | 6.25 | |||||||||
Hypothetical (5% Return Before Expenses) | $ | 1,000.00 | $ | 1,018.24 | $ | 6.67 | |||||||||
Class I* | |||||||||||||||
Actual | $ | 1,000.00 | $ | 889.10 | $ | 5.87 | |||||||||
Hypothetical (5% Return Before Expenses) | $ | 1,000.00 | $ | 1,018.64 | $ | 6.27 | |||||||||
Class R2* | |||||||||||||||
Actual | $ | 1,000.00 | $ | 986.30 | $ | 0.35 | |||||||||
Hypothetical (5% Return Before Expenses) | $ | 1,000.00 | $ | 1,024.56 | $ | 0.33 | |||||||||
Class R3* | |||||||||||||||
Actual | $ | 1,000.00 | $ | 986.30 | $ | 0.36 | |||||||||
Hypothetical (5% Return Before Expenses) | $ | 1,000.00 | $ | 1,024.56 | $ | 0.34 |
† For each class of the Fund, expenses are equal to the annualized expense ratio of such class (1.60% for Class A, 2.25% for Class B, 2.25% for Class C, 1.33% for Class F, 1.25% for Class I, 1.85% for Class R2, and 1.75% for Class R3) multiplied by the average account value over the period, multiplied by 182/366 for Class A, B, C, F and I (to reflect one-half year period) and multiplied by 7/366 for Class R2 and Class R3 (to reflect the period June 24, 2008, commencement of investment of operations, to June 30, 2008).
* As described in Note 3 of the Financial Statements, effective July 1, 2008, the Fund's annualized expenses are contractually limited to 1.35% for Class A, 2.00% for Classes B and C, 1.10% for Class F, 1.00% for Class I, 1.60% for Class R2, and 1.50% for Class R3. Had these restated expenses been in place throughout the most recent half-year period, expenses paid during the period would have been:
Actual | Hypothetical (5% Return Before Expenses) | ||||||||||
Class A | $ | 6.33 | $ | 6.77 | |||||||
Class B | $ | 9.37 | $ | 10.01 | |||||||
Class C | $ | 9.37 | $ | 10.01 | |||||||
Class F | $ | 5.17 | $ | 5.52 | |||||||
Class I | $ | 4.70 | $ | 5.02 | |||||||
Class R2 | $ | 0.30 | $ | 0.28 | |||||||
Class R3 | $ | 0.31 | $ | 0.29 |
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Global Allocation Fund (formerly, Global Equity Fund)
Portfolio Holdings Presented by Sector
June 30, 2008
Sector* | %** | ||||||
Consumer Discretionary | 4.84 | % | |||||
Consumer Staples | 14.80 | % | |||||
Energy | 10.19 | % | |||||
Financials | 15.63 | % | |||||
Health Care | 11.11 | % | |||||
Industrials | 8.87 | % | |||||
Information Technology | 12.01 | % | |||||
Materials | 8.04 | % | |||||
Telecommunication Services | 4.53 | % | |||||
Utilities | 6.37 | % | |||||
Short-Term Investment | 3.61 | % | |||||
Total | 100.00 | % |
* A sector may comprise several industries.
** Represents percent of total investments.
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Developing Local Markets Fund
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. Therefore, the second line of 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.
Beginning Account Value | Ending Account Value | Expenses Paid During Period† | |||||||||||||
1/1/08 | 6/30/08 | 1/1/08 – 6/30/08 | |||||||||||||
Class A | |||||||||||||||
Actual | $ | 1,000.00 | $ | 1,075.50 | $ | 6.35 | |||||||||
Hypothetical (5% Return Before Expenses) | $ | 1,000.00 | $ | 1,018.74 | $ | 6.17 | |||||||||
Class B | |||||||||||||||
Actual | $ | 1,000.00 | $ | 1,073.50 | $ | 9.64 | |||||||||
Hypothetical (5% Return Before Expenses) | $ | 1,000.00 | $ | 1,015.56 | $ | 9.37 | |||||||||
Class C | |||||||||||||||
Actual | $ | 1,000.00 | $ | 1,071.90 | $ | 9.63 | |||||||||
Hypothetical (5% Return Before Expenses) | $ | 1,000.00 | $ | 1,015.56 | $ | 9.37 | |||||||||
Class F | |||||||||||||||
Actual | $ | 1,000.00 | $ | 1,075.80 | $ | 4.39 | |||||||||
Hypothetical (5% Return Before Expenses) | $ | 1,000.00 | $ | 1,020.62 | $ | 4.27 | |||||||||
Class I | |||||||||||||||
Actual | $ | 1,000.00 | $ | 1,078.90 | $ | 4.45 | |||||||||
Hypothetical (5% Return Before Expenses) | $ | 1,000.00 | $ | 1,020.58 | $ | 4.32 | |||||||||
Class P | |||||||||||||||
Actual | $ | 1,000.00 | $ | 1,075.10 | $ | 6.81 | |||||||||
Hypothetical (5% Return Before Expenses) | $ | 1,000.00 | $ | 1,018.31 | $ | 6.62 | |||||||||
Class R2 | |||||||||||||||
Actual | $ | 1,000.00 | $ | 1,074.20 | $ | 7.58 | |||||||||
Hypothetical (5% Return Before Expenses) | $ | 1,000.00 | $ | 1,017.56 | $ | 7.37 | |||||||||
Class R3 | |||||||||||||||
Actual | $ | 1,000.00 | $ | 1,074.80 | $ | 7.07 | |||||||||
Hypothetical (5% Return Before Expenses) | $ | 1,000.00 | $ | 1,018.03 | $ | 6.87 |
† For each class of the Fund, expenses are equal to the annualized expense ratio of such class (1.23% for Class A, 1.87% for Classes B and C, .85% for Class F, .86% for Class I, 1.32% for Class P, 1.47% for Class R2 and 1.37% for Class R3) multiplied by the average account value over the period, multiplied by 182/366 (to reflect one-half year period).
Portfolio Holdings Presented by Sector
June 30, 2008 | |||||||
Sector* | %** | ||||||
Agency | 1.90 | % | |||||
Asset Backed | 38.52 | % | |||||
Banking | 8.42 | % | |||||
Basic Industry | 0.36 | % | |||||
Capital Goods | 0.23 | % | |||||
Consumer Cyclical | 0.02 | % | |||||
Consumer Non-Cyclical | 0.06 | % | |||||
Energy | 0.68 | % | |||||
Finance & Investment | 4.69 | % | |||||
Foreign Sovereign | 0.13 | % | |||||
Sector* | %** | ||||||
Government Guaranteed | 0.98 | % | |||||
Media | 0.48 | % | |||||
Mortgage Backed | 35.78 | % | |||||
Services Cyclical | 0.30 | % | |||||
Services Non-Cyclical | 0.56 | % | |||||
Sovereign | 4.78 | % | |||||
Technology & Electronics | 0.13 | % | |||||
Telecommunications | 1.88 | % | |||||
Short-Term Investments | 0.10 | % | |||||
Total | 100.00 | % |
* A sector may comprise several industries.
** Represents percent of total investments.
9
Schedule of Investments (unaudited)
GLOBAL ALLOCATION FUND (formerly, Global Equity Fund) June 30, 2008
Investments | Shares | U.S. $ Value (000) | |||||||||
LONG-TERM INVESTMENTS 96.11% | |||||||||||
COMMON STOCKS 95.08% | |||||||||||
Australia 0.56% | |||||||||||
Health Care Services 0.56% | |||||||||||
Sonic Healthcare Ltd. | 43,473 | $ | 606 | ||||||||
Belgium 0.65% | |||||||||||
Banks 0.27% | |||||||||||
KBC Group NV | 2,632 | 292 | |||||||||
Food Retail 0.38% | |||||||||||
Delhaize Group | 6,141 | 414 | |||||||||
Total Belgium | 706 | ||||||||||
Bermuda 0.56% | |||||||||||
Oil & Gas Drilling 0.41% | |||||||||||
Seadrill Ltd. | 14,800 | 452 | |||||||||
Oil & Gas Equipment & Services 0.15% | |||||||||||
Weatherford International Ltd.* | 3,200 | 159 | |||||||||
Total Bermuda | 611 | ||||||||||
Brazil 1.17% | |||||||||||
Banks 0.21% | |||||||||||
Unibanco-Uniao de Bancos Brasileiros SA GDR | 1,800 | 228 | |||||||||
Diversified Capital Markets 0.26% | |||||||||||
Porto Seguro SA | 24,400 | 282 | |||||||||
Electric Utilities 0.28% | |||||||||||
EDP-Energias do Brasil SA | 15,200 | 302 | |||||||||
Tobacco 0.42% | |||||||||||
Souza Cruz SA | 16,300 | 465 | |||||||||
Total Brazil | 1,277 |
Investments | Shares | U.S. $ Value (000) | |||||||||
Canada 3.48% | |||||||||||
Communications Equipment 0.01% | |||||||||||
Nortel Networks Corp.* | 667 | $ | 6 | ||||||||
Diversified Metals & Mining 2.04% | |||||||||||
Equinox Minerals Ltd.* | 128,800 | 561 | |||||||||
Fording Canadian Coal Trust Unit | 11,200 | 1,071 | |||||||||
Teck Cominco Ltd. Class B | 12,204 | 588 | |||||||||
2,220 | |||||||||||
Gold 0.44% | |||||||||||
Barrick Gold Corp. | 10,506 | 478 | |||||||||
Oil & Gas Exploration & Production 0.99% | |||||||||||
Addax Petroleum Corp. | 22,450 | 1,084 | |||||||||
Total Canada | 3,788 | ||||||||||
China 0.24% | |||||||||||
Real Estate Management & Development 0.24% | |||||||||||
Sino-Ocean Land Holdings Ltd. | 467,500 | 264 | |||||||||
Egypt 0.48% | |||||||||||
Wireless Telecommunication Services 0.48% | |||||||||||
Orascom Telecom Holdings (SAE) GDR | 8,100 | 518 | |||||||||
Finland 0.38% | |||||||||||
Communications Equipment 0.38% | |||||||||||
Nokia Oyj ADR | 16,700 | 409 | |||||||||
France 3.66% | |||||||||||
Banks 1.03% | |||||||||||
BNP Paribas SA | 6,139 | 556 | |||||||||
Societe Generale | 6,476 | 564 | |||||||||
1,120 |
See Notes to Financial Statements.
10
Schedule of Investments (unaudited)(continued)
GLOBAL ALLOCATION FUND (formerly, Global Equity Fund) June 30, 2008
Investments | Shares | U.S. $ Value (000) | |||||||||
France (continued) | |||||||||||
Food Retail 0.36% | |||||||||||
Casino Guichard-Perrachon SA | 3,486 | $ | 395 | ||||||||
Integrated Oil & Gas 0.56% | |||||||||||
Total SA | 7,090 | 605 | |||||||||
Movies & Entertainment 0.50% | |||||||||||
Vivendi SA | 14,377 | 545 | |||||||||
Multi-Line Insurance 0.45% | |||||||||||
AXA | 16,634 | 494 | |||||||||
Multi-Utilities 0.76% | |||||||||||
SUEZ SA | 12,163 | 828 | |||||||||
Total France | 3,987 | ||||||||||
Germany 6.14% | |||||||||||
Automobile Manufacturers 0.24% | |||||||||||
Bayerische Motoren Werke AG | 5,439 | 262 | |||||||||
Diversified Chemicals 0.63% | |||||||||||
Bayer AG | 5,000 | 421 | |||||||||
Symrise GmbH & Co. AG | 12,021 | 261 | |||||||||
682 | |||||||||||
Electric Utilities 0.81% | |||||||||||
E. On AG | 4,378 | 883 | |||||||||
Health Care Services 1.27% | |||||||||||
Fresenius Medical Care AG & Co. KGaA | 25,150 | 1,386 | |||||||||
Household Products 0.65% | |||||||||||
Henkel KGaA | 18,926 | 711 | |||||||||
Industrial Conglomerates 0.51% | |||||||||||
Siemens AG | 4,990 | 554 | |||||||||
Industrial Gases 0.95% | |||||||||||
Linde AG | 7,335 | 1,031 |
Investments | Shares | U.S. $ Value (000) | |||||||||
Integrated Telecommunication 0.82% | |||||||||||
Deutsche Telekom AG Registered Shares | 54,679 | $ | 895 | ||||||||
Pharmaceuticals 0.26% | |||||||||||
Merck KGaA | 1,977 | 281 | |||||||||
Total Germany | 6,685 | ||||||||||
Greece 0.78% | |||||||||||
Banks 0.78% | |||||||||||
National Bank of Greece SA | 18,951 | 854 | |||||||||
Hong Kong 1.13% | |||||||||||
Banks 0.59% | |||||||||||
BOC Hong Kong (Holdings) Ltd. | 242,500 | 642 | |||||||||
Casinos & Gaming 0.28% | |||||||||||
Galaxy Entertainment Group Ltd.* | 467,000 | 302 | |||||||||
Water Utilities 0.26% | |||||||||||
Guangdong Investment Ltd. | 707,100 | 287 | |||||||||
Total Hong Kong | 1,231 | ||||||||||
India 0.26% | |||||||||||
Systems Software 0.26% | |||||||||||
Tata Consultancy Services Ltd. | 14,108 | 281 | |||||||||
Italy 1.66% | |||||||||||
Aerospace & Defense 0.40% | |||||||||||
Finmeccanica SpA | 16,555 | 435 | |||||||||
Electric Utilities 0.75% | |||||||||||
Enel SpA | 85,332 | 812 | |||||||||
Oil & Gas Refining & Marketing 0.51% | |||||||||||
ENI SpA | 7,550 | 560 | |||||||||
Total Italy | 1,807 |
See Notes to Financial Statements.
11
Schedule of Investments (unaudited)(continued)
GLOBAL ALLOCATION FUND (formerly, Global Equity Fund) June 30, 2008
Investments | Shares | U.S. $ Value (000) | |||||||||
Japan 6.73% | |||||||||||
Automobile Manufacturers 0.52% | |||||||||||
Toyota Motor Corp. | 11,900 | $ | 561 | ||||||||
Banks 0.48% | |||||||||||
Sumitomo Mitsui Financial Group Inc | 69 | 519 | |||||||||
Home Entertainment Software 0.88% | |||||||||||
Nintendo Co., Ltd. | 1,700 | 959 | |||||||||
Integrated Telecommunication 0.56% | |||||||||||
Nippon Telegraph & Telephone Corp. | 125 | 612 | |||||||||
Office Electronics 0.74% | |||||||||||
Ricoh Co., Ltd. | 44,600 | 805 | |||||||||
Office REITs 0.54% | |||||||||||
Nippon Commercial Investment REIT | 208 | 588 | |||||||||
Railroads 0.86% | |||||||||||
East Japan Railway Co. | 115 | 937 | |||||||||
Real Estate Investment Trusts 0.15% | |||||||||||
Nippon Residential Investment Corp. REIT | 56 | 168 | |||||||||
Real Estate Management & Development 0.17% | |||||||||||
Tokyo Tatemono Co., Ltd. | 29,000 | 188 | |||||||||
Semiconductor & Semiconductor Equipment 0.24% | |||||||||||
Elpida Memory, Inc.* | 8,300 | 266 | |||||||||
Trading Companies & Distributors 1.59% | |||||||||||
Mitsubishi Corp. | 19,400 | 639 | |||||||||
Mitsui & Co., Ltd. | 26,000 | 574 | |||||||||
Sumitomo Corp. | 39,400 | 518 | |||||||||
1,731 | |||||||||||
Total Japan | 7,334 |
Investments | Shares | U.S. $ Value (000) | |||||||||
Liberia 0.07% | |||||||||||
Leisure 0.07% | |||||||||||
Royal Caribbean Cruises Ltd. | 3,500 | $ | 79 | ||||||||
Mexico 0.15% | |||||||||||
Real Estate Management & Development 0.15% | |||||||||||
Desarrolladora Homex, SA de CV ADR* | 2,700 | 158 | |||||||||
Netherlands 0.49% | |||||||||||
Diversified Financial Services 0.37% | |||||||||||
ING Groep NV CVA | 12,431 | 396 | |||||||||
Food Retail 0.12% | |||||||||||
Koninklijke Ahold NV | 9,954 | 134 | |||||||||
Total Netherlands | 530 | ||||||||||
Netherlands Antilles 0.92% | |||||||||||
Oil & Gas Equipment & Services 0.92% | |||||||||||
Schlumberger Ltd. | 9,346 | 1,004 | |||||||||
Norway 0.85% | |||||||||||
Oil & Gas Equipment & Services 0.85% | |||||||||||
Petroleum Geo-Services ASA* | 37,790 | 928 | |||||||||
Panama 0.17% | |||||||||||
Hotels 0.17% | |||||||||||
Carnival Corp. Unit | 5,700 | 188 | |||||||||
Portugal 0.23% | |||||||||||
Electric Utilities 0.23% | |||||||||||
EDP-Energias de Portugal, SA | 48,754 | 255 | |||||||||
Russia 0.51% | |||||||||||
Oil & Gas Refining & Marketing 0.51% | |||||||||||
OAO Gazprom ADR | 9,500 | 551 |
See Notes to Financial Statements.
12
Schedule of Investments (unaudited)(continued)
GLOBAL ALLOCATION FUND (formerly, Global Equity Fund) June 30, 2008
Investments | Shares | U.S. $ Value (000) | |||||||||
South Africa 1.28% | |||||||||||
Diversified Metals & Mining 0.89% | |||||||||||
Impala Platinum Holdings Ltd. | 24,484 | $ | 966 | ||||||||
Wireless Telecommunication Services 0.39% | |||||||||||
MTN Group Ltd. | 26,903 | 428 | |||||||||
Total South Africa | 1,394 | ||||||||||
South Korea 1.09% | |||||||||||
Banks 0.37% | |||||||||||
Kookmin Bank | 6,921 | 409 | |||||||||
Semiconductor & Semiconductor Equipment 0.72% | |||||||||||
Samsung Electronics Co., Ltd. | 1,311 | 783 | |||||||||
Total South Korea | 1,192 | ||||||||||
Spain 2.07% | |||||||||||
Banks 0.75% | |||||||||||
Banco Santander SA | 29,370 | 540 | |||||||||
Banco Santander SA ADR | 15,200 | 276 | |||||||||
816 | |||||||||||
Heavy Electrical Equipment 0.43% | |||||||||||
Gamesa Corporacion Tecnologica, SA | 9,461 | 465 | |||||||||
Highway & Railtracks 0.24% | |||||||||||
Cintra Concesiones de Infraestructuras de Transporte SA | 23,156 | 260 | |||||||||
Integrated Oil & Gas 0.65% | |||||||||||
Repsol YPF, SA | 14,512 | 572 | |||||||||
Repsol YPF, SA ADR | 3,500 | 137 | |||||||||
709 | |||||||||||
Total Spain | 2,250 |
Investments | Shares | U.S. $ Value (000) | |||||||||
Switzerland 2.90% | |||||||||||
Diversified Capital Markets 0.25% | |||||||||||
Credit Suisse Group | 5,992 | $ | 275 | ||||||||
Life Sciences Tools & Services 0.66% | |||||||||||
Lonza Group Ltd. AG | 5,200 | 721 | |||||||||
Packaged Foods 0.93% | |||||||||||
Nestle SA | 22,270 | 1,006 | |||||||||
Pharmaceuticals 1.06% | |||||||||||
Roche Holding Ltd. AG | 6,426 | 1,158 | |||||||||
Total Switzerland | 3,160 | ||||||||||
Taiwan 1.18% | |||||||||||
Semiconductor & Semiconductor Equipment 1.18% | |||||||||||
MediaTek Inc. | 53,000 | 611 | |||||||||
Taiwan Semiconductor Manufacturing Co., Ltd. ADR | 61,724 | 674 | |||||||||
Total Taiwan | 1,285 | ||||||||||
United Kingdom 9.65% | |||||||||||
Advertising 0.36% | |||||||||||
Aegis Group plc | 179,510 | 385 | |||||||||
Aerospace & Defense 0.95% | |||||||||||
BAE Systems plc | 117,471 | 1,035 | |||||||||
Banks 0.63% | |||||||||||
Royal Bank of Scotland Group plc (The) | 161,153 | 690 | |||||||||
Brewers 0.75% | |||||||||||
SABMiller plc | 35,679 | 819 | |||||||||
Distillers & Vintners 0.80% | |||||||||||
Diageo plc | 47,315 | 871 | |||||||||
Diversified Metals & Mining 0.72% | |||||||||||
Anglo American plc | 11,103 | 780 |
See Notes to Financial Statements.
13
Schedule of Investments (unaudited)(continued)
GLOBAL ALLOCATION FUND (formerly, Global Equity Fund) June 30, 2008
Investments | Shares | U.S. $ Value (000) | |||||||||
United Kingdom (continued) | |||||||||||
Food Retail 0.44% | |||||||||||
Tesco plc | 65,071 | $ | 479 | ||||||||
Household Products 0.37% | |||||||||||
Reckitt Benckiser plc | 7,941 | 403 | |||||||||
Life & Health Insurance 0.45% | |||||||||||
Prudential plc | 46,301 | 492 | |||||||||
Multi-Line Insurance 0.59% | |||||||||||
Aviva plc | 64,649 | 645 | |||||||||
Multi-Utilities 0.63% | |||||||||||
National Grid plc | 52,179 | 686 | |||||||||
Oil & Gas Exploration & Production 0.66% | |||||||||||
Tullow Oil plc | 37,980 | 722 | |||||||||
Packaged Foods 0.33% | |||||||||||
Premier Foods plc | 188,913 | 358 | |||||||||
Publishing & Printing 0.63% | |||||||||||
Reed Elsevier plc | 59,605 | 684 | |||||||||
Soft Drinks 0.11% | |||||||||||
Diageo plc ADR | 1,637 | 121 | |||||||||
Tobacco 0.39% | |||||||||||
British American Tobacco plc | 12,262 | 425 | |||||||||
Wireless Telecommunication Services 0.84% | |||||||||||
Vodafone Group plc | 308,615 | 917 | |||||||||
Total United Kingdom | 10,512 | ||||||||||
United States 45.64% | |||||||||||
Aerospace & Defense 2.35% | |||||||||||
Boeing Co. (The) | 3,600 | 237 | |||||||||
General Dynamics Corp. | 2,806 | 236 | |||||||||
Honeywell International Inc. | 6,558 | 330 |
Investments | Shares | U.S. $ Value (000) | |||||||||
Lockheed Martin Corp. | 5,600 | $ | 552 | ||||||||
Raytheon Co. | 9,633 | 542 | |||||||||
United Technologies Corp. | 10,700 | 660 | |||||||||
2,557 | |||||||||||
Agricultural Products 0.65% | |||||||||||
Archer Daniels Midland Co. | 21,100 | 712 | |||||||||
Air Freight & Couriers 0.30% | |||||||||||
United Parcel Service, Inc. Class B | 5,310 | 326 | |||||||||
Apparel & Accessories 0.35% | |||||||||||
Coach, Inc.* | 9,400 | 271 | |||||||||
Polo Ralph Lauren Corp., Class A | 1,700 | 107 | |||||||||
378 | |||||||||||
Banks 1.95% | |||||||||||
Bank of America Corp. | 15,264 | 364 | |||||||||
Bank of New York Mellon Corp. (The) | 17,505 | 662 | |||||||||
Marshall & Ilsley Corp. (The) | 3,899 | 60 | |||||||||
U.S. Bancorp | 14,900 | 416 | |||||||||
Wachovia Corp. | 3,885 | 60 | |||||||||
Wells Fargo & Co. | 23,864 | 567 | |||||||||
2,129 | |||||||||||
Biotechnology 1.96% | |||||||||||
Amgen Inc.* | 10,600 | 500 | |||||||||
Celgene Corp.* | 9,200 | 588 | |||||||||
Genzyme Corp.* | 6,900 | 497 | |||||||||
Gilead Sciences, Inc.* | 10,356 | 548 | |||||||||
2,133 | |||||||||||
Brewers 0.25% | |||||||||||
Anheuser-Busch Cos., Inc. | 4,300 | 267 | |||||||||
Broadcasting & Cable TV 0.12% | |||||||||||
Comcast Corp. Class A | 7,037 | 132 |
See Notes to Financial Statements.
14
Schedule of Investments (unaudited)(continued)
GLOBAL ALLOCATION FUND (formerly, Global Equity Fund) June 30, 2008
Investments | Shares | U.S. $ Value (000) | |||||||||
United States (continued) | |||||||||||
Communications Equipment 1.87% | |||||||||||
Cisco Systems, Inc.* | 27,800 | $ | 647 | ||||||||
Corning Inc. | 21,354 | 492 | |||||||||
QUALCOMM Inc. | 20,196 | 896 | |||||||||
2,035 | |||||||||||
Computer & Electronics Retail 0.32% | |||||||||||
Best Buy Co., Inc. | 8,800 | 348 | |||||||||
Computer Hardware 1.56% | |||||||||||
Harris Corp. | 2,400 | 121 | |||||||||
Hewlett-Packard Co. | 17,090 | 756 | |||||||||
International Business Machines Corp. | 6,900 | 818 | |||||||||
1,695 | |||||||||||
Construction & Farm Machinery 0.15% | |||||||||||
Caterpillar Inc. | 2,258 | 167 | |||||||||
Department Stores 0.30% | |||||||||||
Kohl's Corp.* | 8,300 | 332 | |||||||||
Diversified Capital Markets 0.71% | |||||||||||
JPMorgan Chase & Co. | 22,423 | 769 | |||||||||
Diversified Financial Services 0.36% | |||||||||||
Citigroup, Inc. | 11,744 | 197 | |||||||||
Western Union Co. (The) | 7,700 | 190 | |||||||||
387 | |||||||||||
Diversified Metals & Mining 0.11% | |||||||||||
Freeport-McMoRan Copper & Gold Inc. | 1,005 | 118 | |||||||||
Drug Retail 0.96% | |||||||||||
CVS Caremark Corp. | 24,152 | 956 | |||||||||
Walgreen Co. | 2,644 | 86 | |||||||||
1,042 |
Investments | Shares | U.S. $ Value (000) | |||||||||
Electric Utilities 1.63% | |||||||||||
FPL Group, Inc. | 7,700 | $ | 505 | ||||||||
Northeast Utilities | 12,900 | 329 | |||||||||
PG&E Corp. | 13,213 | 525 | |||||||||
Progress Energy, Inc. | 9,951 | 416 | |||||||||
1,775 | |||||||||||
Electrical Components & Equipment 0.45% | |||||||||||
Emerson Electric Co. | 9,920 | 491 | |||||||||
Electronic Equipment & Instruments 0.13% | |||||||||||
Agilent Technologies, Inc.* | 3,900 | 139 | |||||||||
Fertilizers & Agricultural Chemicals 1.48% | |||||||||||
Monsanto Co. | 12,750 | 1,612 | |||||||||
Food Retail 0.24% | |||||||||||
Kroger Co. (The) | 9,063 | 262 | |||||||||
General Merchandise Stores 0.38% | |||||||||||
Macy's, Inc. | 4,200 | 81 | |||||||||
Target Corp. | 7,200 | 335 | |||||||||
416 | |||||||||||
Health Care Equipment 1.05% | |||||||||||
Baxter International, Inc. | 5,483 | 351 | |||||||||
Medtronic, Inc. | 6,000 | 310 | |||||||||
St. Jude Medical, Inc.* | 11,700 | 478 | |||||||||
1,139 | |||||||||||
Health Care Services 1.19% | |||||||||||
Express Scripts, Inc.* | 10,500 | 658 | |||||||||
Medco Health Solutions, Inc.* | 6,334 | 299 | |||||||||
Quest Diagnostics Inc. | 6,926 | 336 | |||||||||
1,293 | |||||||||||
Health Care Supplies 0.01% | |||||||||||
Mylan Laboratories Inc.* | 1,300 | 16 | |||||||||
Home Entertainment Software 0.46% | |||||||||||
Electronic Arts Inc.* | 11,400 | 506 |
See Notes to Financial Statements.
15
Schedule of Investments (unaudited)(continued)
GLOBAL ALLOCATION FUND (formerly, Global Equity Fund) June 30, 2008
Investments | Shares | U.S. $ Value (000) | |||||||||
United States (continued) | |||||||||||
Home Improvement Retail 0.15% | |||||||||||
Home Depot Inc. (The) | 7,000 | $ | 164 | ||||||||
Household Products 2.03% | |||||||||||
Colgate-Palmolive Co. | 10,267 | 709 | |||||||||
Procter & Gamble Co. (The) | 24,790 | 1,508 | |||||||||
2,217 | |||||||||||
Hypermarkets & Super Centers 1.06% | |||||||||||
Wal-Mart Stores, Inc. | 20,602 | 1,158 | |||||||||
Industrial Conglomerates 0.62% | |||||||||||
General Electric Co. | 25,356 | 677 | |||||||||
Industrial Gases 0.77% | |||||||||||
Praxair, Inc. | 8,899 | 839 | |||||||||
Insurance: Brokers 0.70% | |||||||||||
Aon Corp. | 16,700 | 767 | |||||||||
Integrated Oil & Gas 3.00% | |||||||||||
Chevron Corp. | 9,971 | 988 | |||||||||
ConocoPhillips | 3,758 | 355 | |||||||||
ExxonMobil Corp. | 19,442 | 1,713 | |||||||||
Marathon Oil Corp. | 1,500 | 78 | |||||||||
Occidental Petroleum Corp. | 1,500 | 135 | |||||||||
3,269 | |||||||||||
Integrated Telecommunication 1.43% | |||||||||||
AT&T Inc. | 39,310 | 1,324 | |||||||||
Sprint Nextel Corp.* | 5,040 | 48 | |||||||||
Verizon Communications, Inc. | 5,112 | 181 | |||||||||
1,553 | |||||||||||
Internet Software & Services 0.17% | |||||||||||
WebMD Health Corp., Class A* | 200 | 5 | |||||||||
Yahoo! Inc.* | 8,600 | 178 | |||||||||
183 |
Investments | Shares | U.S. $ Value (000) | |||||||||
Investment Banking & Brokerage 0.72% | |||||||||||
Goldman Sachs Group, Inc. (The) | 1,200 | $ | 210 | ||||||||
Merrill Lynch & Co., Inc. | 9,700 | 308 | |||||||||
Morgan Stanley | 7,500 | 270 | |||||||||
788 | |||||||||||
IT Consulting & Services 0.94% | |||||||||||
Activision, Inc.* | 29,964 | 1,021 | |||||||||
Life & Health Insurance 0.42% | |||||||||||
MetLife, Inc. | 4,500 | 238 | |||||||||
Prudential Financial, Inc. | 3,600 | 215 | |||||||||
453 | |||||||||||
Movies & Entertainment 0.32% | |||||||||||
Time Warner Inc. | 9,700 | 143 | |||||||||
Walt Disney Co. (The) | 6,662 | 208 | |||||||||
351 | |||||||||||
Multi-Line Insurance 0.39% | |||||||||||
American International Group, Inc. | 7,399 | 196 | |||||||||
Hartford Financial Group, Inc. (The) | 3,551 | 229 | |||||||||
425 | |||||||||||
Multi-Utilities 0.57% | |||||||||||
Dominion Resources, Inc. | 13,000 | 617 | |||||||||
Oil & Gas Equipment & Services 0.16% | |||||||||||
Baker Hughes, Inc. | 1,988 | 174 | |||||||||
Oil & Gas Exploration & Production 0.32% | |||||||||||
Apache Corp. | 1,000 | 139 | |||||||||
XTO Energy Inc. | 3,080 | 211 | |||||||||
350 | |||||||||||
Oil & Gas Refining & Marketing 0.45% | |||||||||||
Hess Corp. | 2,200 | 278 | |||||||||
Valero Energy Corp. | 5,300 | 218 | |||||||||
496 |
See Notes to Financial Statements.
16
Schedule of Investments (unaudited)(continued)
GLOBAL ALLOCATION FUND (formerly, Global Equity Fund) June 30, 2008
Investments | Shares | U.S. $ Value (000) | |||||||||
United States (continued) | |||||||||||
Packaged Foods 1.84% | |||||||||||
Campbell Soup Co. | 5,700 | $ | 191 | ||||||||
Kellogg Co. | 8,800 | 423 | |||||||||
Kraft Foods, Inc. Class A | 23,030 | 655 | |||||||||
Wm. Wrigley Jr. Co. | 9,400 | 731 | |||||||||
2,000 | |||||||||||
Pharmaceuticals 3.06% | |||||||||||
Abbott Laboratories | 10,700 | 567 | |||||||||
Amylin Pharmaceuticals, Inc.* | 5,100 | 130 | |||||||||
Bristol-Myers Squibb Co. | 8,100 | 166 | |||||||||
Eli Lilly & Co. | 8,700 | 402 | |||||||||
ImClone Systems Inc.* | 6,978 | 282 | |||||||||
Johnson & Johnson | 7,160 | 461 | |||||||||
Merck & Co., Inc. | 15,600 | 588 | |||||||||
Pfizer Inc. | 21,249 | 371 | |||||||||
Schering-Plough Corp. | 18,700 | 368 | |||||||||
3,335 | |||||||||||
Regional Banks 0.70% | |||||||||||
PNC Financial Services Group, Inc. (The) | 11,400 | 651 | |||||||||
SunTrust Banks, Inc. | 3,100 | 112 | |||||||||
763 | |||||||||||
Restaurants 0.05% | |||||||||||
Darden Restaurants Inc. | 1,700 | 54 | |||||||||
Semiconductor & Semiconductor Equipment 0.85% | |||||||||||
Intel Corp. | 33,488 | 719 | |||||||||
NVIDIA Corp.* | 500 | 10 | |||||||||
Texas Instruments Inc. | 7,061 | 199 | |||||||||
928 | |||||||||||
Soft Drinks 1.26% | |||||||||||
Coca-Cola Co. (The) | 14,200 | 738 | |||||||||
PepsiCo, Inc. | 9,939 | 632 | |||||||||
1,370 |
Investments | Shares | U.S. $ Value (000) | |||||||||
Specialty Stores 0.06% | |||||||||||
GameStop Corp.* | 600 | $ | 24 | ||||||||
Tiffany & Co. | 1,100 | 45 | |||||||||
69 | |||||||||||
Systems Software 1.60% | |||||||||||
Adobe Systems Inc.* | 8,033 | 317 | |||||||||
Microsoft Corp. | 31,670 | 871 | |||||||||
Oracle Corp.* | 26,626 | 559 | |||||||||
1,747 | |||||||||||
Thrifts & Mortgages Finance 0.30% | |||||||||||
Fannie Mae | 17,000 | 332 | |||||||||
Tobacco 0.41% | |||||||||||
Philip Morris International Inc. | 9,000 | 444 | |||||||||
Total United States | 49,720 | ||||||||||
Total Common Stocks (cost $105,036,196) | 103,564 | ||||||||||
PREFERRED STOCKS 1.03% | |||||||||||
Brazil 0.44% | |||||||||||
Electric Utilities 0.44% | |||||||||||
Companhia de Transmissao de Energia Electrica Paulista | 14,400 | 475 | |||||||||
Russia 0.59% | |||||||||||
Banks 0.59% | |||||||||||
Sberbank | 326,700 | 647 | |||||||||
Total Preferred Stocks (cost $1,166,569) | 1,122 | ||||||||||
Total Long-Term Investments (cost $106,202,765) | 104,686 |
See Notes to Financial Statements.
17
Schedule of Investments (unaudited)(concluded)
GLOBAL ALLOCATION FUND (formerly, Global Equity Fund) June 30, 2008
Investments | Principal Amount (000) | U.S. $ Value (000) | |||||||||
SHORT-TERM INVESTMENT 3.60% | |||||||||||
Repurchase Agreement | |||||||||||
Repurchase Agreement dated 6/30/2008, 1.68% due 7/1/2008 with State Street Bank & Trust Co. collateralized by $3,990,000 of Federal National Mortgage Assoc. at 3.375% due 12/15/2008; value $4,004,963; proceeds: $3,925,730 (cost $3,925,547) | $ | 3,926 | $ | 3,926 | |||||||
Total Investments in Securities 99.71% (cost $110,128,312) | 108,612 | ||||||||||
Foreign Cash and Other Assets in Excess of Liabilities 0.29% | 316 | ||||||||||
Net Assets 100.00% | $ | 108,928 |
ADR American Depositary Receipt.
GDR Global Depositary Receipt.
REIT Real Estate Investment Trust.
Unit More than one class of securities traded together.
* Non income-producing security.
See Notes to Financial Statements.
18
Schedule of Investments (unaudited)
DEVELOPING LOCAL MARKETS FUND June 30, 2008
Investments | Interest Rate | Maturity Date | Modified Duration | Principal Amount (000) | Value | ||||||||||||||||||
ASSET-BACKED SECURITIES 34.08% | |||||||||||||||||||||||
Automobile 11.23% | |||||||||||||||||||||||
BMW Vehicle Owner Trust 2005-A A4 | 4.28 | % | 2/25/2010 | 0.44 | $ | 813 | $ | 815,354 | |||||||||||||||
Capital Auto Receivables Asset Trust 2006-1 A3 | 5.03 | % | 10/15/2009 | 0.15 | 119 | 119,449 | |||||||||||||||||
Capital Auto Receivables Asset Trust 2006-1 A4 | 5.04 | % | 5/17/2010 | 0.55 | 830 | 838,059 | |||||||||||||||||
Capital One Prime Auto Receivables Trust 2006-1 A3 | 4.99 | % | 9/15/2010 | 0.38 | 734 | 739,712 | |||||||||||||||||
Carmax Auto Owner Trust 2006-2 A3 | 5.15 | % | 2/15/2011 | 0.58 | 1,244 | 1,257,665 | |||||||||||||||||
Daimler Chrysler Auto Trust 2005-B A4 | 4.20 | % | 7/8/2010 | 0.45 | 828 | 830,813 | |||||||||||||||||
Daimler Chrysler Auto Trust 2006-B A3 | 5.33 | % | 8/8/2010 | 0.43 | 269 | 271,054 | |||||||||||||||||
Ford Credit Auto Owner Trust 2005-A A4 | 3.72 | % | 10/15/2009 | 0.20 | 718 | 718,919 | |||||||||||||||||
Ford Credit Auto Owner Trust 2005-B A4 | 4.38 | % | 1/15/2010 | 0.29 | 410 | 410,313 | |||||||||||||||||
Ford Credit Auto Owner Trust 2005-B B | 4.64 | % | 4/15/2010 | 0.77 | 530 | 530,375 | |||||||||||||||||
Ford Credit Auto Owner Trust 2006-B A4 | 5.25 | % | 9/15/2011 | 1.51 | 1,000 | 1,018,765 | |||||||||||||||||
Harley-Davidson Motorcycle Trust 2005-4 A2 | 4.85 | % | 6/15/2012 | 1.01 | 500 | 504,684 | |||||||||||||||||
Harley-Davidson Motorcycle Trust 2006-3 A3 | 5.24 | % | 1/15/2012 | 0.60 | 840 | 848,383 | |||||||||||||||||
Harley-Davidson Motorcycle Trust 2007-1 A2 | 5.29 | % | 1/18/2011 | 0.24 | 867 | 871,206 | |||||||||||||||||
USAA Auto Owner Trust 2005-4 A3 | 4.83 | % | 4/15/2010 | 0.17 | 213 | 213,345 | |||||||||||||||||
USAA Auto Owner Trust 2006-1 A3 | 5.01 | % | 9/15/2010 | 0.36 | 394 | 396,952 | |||||||||||||||||
USAA Auto Owner Trust 2006-2 A3 | 5.32 | % | 9/15/2010 | 0.30 | 166 | 166,580 | |||||||||||||||||
USAA Auto Owner Trust 2006-4 A3 | 5.01 | % | 6/15/2011 | 0.59 | 840 | 848,952 | |||||||||||||||||
World Omni Auto Receivables Trust 2005-A A4 | 3.82 | % | 11/14/2011 | 0.69 | 741 | 743,422 | |||||||||||||||||
Total | 12,144,002 | ||||||||||||||||||||||
Credit Cards 13.07% | |||||||||||||||||||||||
American Express Credit Account Master Trust 2002-5 A | 2.641 | %# | 2/15/2012 | 0.03 | 1,000 | 997,820 | |||||||||||||||||
American Express Credit Account Master Trust 2004-4 A | 2.561 | %# | 3/15/2012 | 0.03 | 760 | 757,331 | |||||||||||||||||
BA Credit Card Trust 2006-A9 A9 | 2.481 | %# | 2/15/2013 | 0.02 | 675 | 665,985 | |||||||||||||||||
BA Credit Card Trust 2007-A13 A13 | 2.691 | %# | 4/16/2012 | 0.03 | 956 | 952,832 | |||||||||||||||||
BA Credit Card Trust 2008-A1 A1 | 3.051 | %# | 4/15/2013 | 0.03 | 1,000 | 998,708 | |||||||||||||||||
Bank One Issuance Trust 2004-A6 A6 | 3.94 | % | 4/16/2012 | 1.07 | 1,000 | 1,005,123 |
See Notes to Financial Statements.
19
Schedule of Investments (unaudited)(continued)
DEVELOPING LOCAL MARKETS FUND June 30, 2008
Investments | Interest Rate | Maturity Date | Modified Duration | Principal Amount (000) | Value | ||||||||||||||||||
Credit Cards (continued) | |||||||||||||||||||||||
Capital One Multi-Asset Execution Trust 2005-A3 A3 | 4.05 | % | 3/15/2013 | 1.76 | $ | 500 | $ | 496,641 | |||||||||||||||
Chase Credit Card Master Trust 2003-5 A | 2.591 | %# | 1/17/2011 | 0.03 | 1,000 | 999,756 | |||||||||||||||||
Chase Issuance Trust 2005-A12 A | 2.481 | %# | 2/15/2011 | 0.03 | 1,000 | 998,566 | |||||||||||||||||
Chase Issuance Trust 2005-A3 A | 2.491 | %# | 10/17/2011 | 0.03 | 600 | 598,772 | |||||||||||||||||
Citibank Credit Card Issuance Trust 2006-A2 A2 | 4.85 | % | 2/10/2011 | 0.58 | 1,130 | 1,140,806 | |||||||||||||||||
Citibank Credit Card Issuance Trust 2007-A2 A2 | 2.668 | %# | 5/21/2012 | 0.13 | 250 | 247,324 | |||||||||||||||||
Discover Card Master Trust I 2006-2 A1 | 2.471 | %# | 1/17/2012 | 0.03 | 900 | 891,470 | |||||||||||||||||
First USA Credit Card Master Trust 1998-6 A | 2.641 | %# | 4/18/2011 | 0.04 | 1,600 | 1,599,981 | |||||||||||||||||
MBNA Credit Card Master Note Trust 2001-A5 A5 | 2.681 | %# | 3/15/2011 | 0.03 | 930 | 929,808 | |||||||||||||||||
MBNA Credit Card Master Note Trust 2005-A7 A7 | 4.30 | % | 2/15/2011 | 0.20 | 850 | 852,421 | |||||||||||||||||
Total | 14,133,344 | ||||||||||||||||||||||
Home Equity 9.78% | |||||||||||||||||||||||
Bank One Issuance Trust 2003-A7 A7 | 3.35 | % | 3/15/2011 | 0.03 | 1,401 | 1,401,333 | |||||||||||||||||
Bank One Issuance Trust 2004-A1 A1 | 3.45 | % | 10/17/2011 | 0.60 | 800 | 801,052 | |||||||||||||||||
BMW Vehicle Owner Trust 2006-A A3 | 5.13 | % | 9/27/2010 | 0.45 | 574 | 578,792 | |||||||||||||||||
Capital One Multi-Asset Execution Trust 2003-A4 A4 | 3.65 | % | 7/15/2011 | 0.20 | 1,570 | 1,572,299 | |||||||||||||||||
Capital One Prime Auto Receivables Trust 2006-2 A3 | 4.98 | % | 9/15/2010 | 0.38 | 825 | 829,906 | |||||||||||||||||
Capital One Prime Auto Receivables Trust 2007-2 A3 | 4.89 | % | 1/17/2012 | 1.11 | 890 | 897,456 | |||||||||||||||||
Citibank Credit Card Issuance Trust 2005-A10 A10 | 2.481 | %# | 12/15/2010 | 0.03 | 1,000 | 998,601 | |||||||||||||||||
Daimler Chrysler Auto Trust 2005-A A4 | 3.74 | % | 2/8/2010 | 0.29 | 848 | 848,668 | |||||||||||||||||
Discover Card Master Trust I 2003-4 A1 | 2.581 | %# | 5/15/2011 | 0.03 | 975 | 972,528 | |||||||||||||||||
MBNA Credit Card Master Note Trust 2003-A11 A11 | 3.65 | % | 3/15/2011 | 0.28 | 200 | 200,354 | |||||||||||||||||
MBNA Credit Card Master Note Trust 2003-A12 A12 | 2.581 | %# | 5/16/2011 | 0.03 | 250 | 249,766 | |||||||||||||||||
MBNA Credit Card Master Note Trust 2006-A1 A | 4.90 | % | 7/15/2011 | 0.60 | 965 | 974,915 | |||||||||||||||||
USAA Auto Owner Trust 2006-3 A3 | 5.36 | % | 2/15/2011 | 0.46 | 241 | 243,100 | |||||||||||||||||
Total | 10,568,770 | ||||||||||||||||||||||
Total Asset-Backed Securities (cost $36,719,069) | 36,846,116 |
See Notes to Financial Statements.
20
Schedule of Investments (unaudited)(continued)
DEVELOPING LOCAL MARKETS FUND June 30, 2008
Investments | Interest Rate | Maturity Date | Modified Duration | Principal Amount (000) | Value | ||||||||||||||||||
CORPORATE BONDS 6.92% | |||||||||||||||||||||||
Auto Loans 0.02% | |||||||||||||||||||||||
General Motors Acceptance Corp. LLC | 6.75 | % | 12/1/2014 | 4.61 | $ | 25 | $ | 16,530 | |||||||||||||||
Banking 0.72% | |||||||||||||||||||||||
Citigroup, Inc. | 7.25 | % | 10/1/2010 | 2.03 | 275 | 286,025 | |||||||||||||||||
Standard Bank plc (United Kingdom)(a) | Zero Coupon | 7/17/2008 | 498 | 497,707 | |||||||||||||||||||
Total | 783,732 | ||||||||||||||||||||||
Building Materials 0.23% | |||||||||||||||||||||||
CRH America, Inc. | 5.625 | % | 9/30/2011 | 2.87 | 250 | 244,595 | |||||||||||||||||
Chemicals 0.09% | |||||||||||||||||||||||
Braskem Financial Ltd. (Cayman Islands)†(a) | 7.25 | % | 6/5/2018 | 6.94 | 100 | 99,500 | |||||||||||||||||
Consumer/Commercial/Lease Financing 0.47% | |||||||||||||||||||||||
General Electric Capital Corp. | 5.25 | % | 10/19/2012 | 3.77 | 500 | 505,355 | |||||||||||||||||
Electronics 0.13% | |||||||||||||||||||||||
Tyco Electronics Group SA (Luxembourg)(a) | 6.00 | % | 10/1/2012 | 3.65 | 140 | 141,491 | |||||||||||||||||
Food: Wholesale 0.06% | |||||||||||||||||||||||
Corn Products International, Inc. | 8.45 | % | 8/15/2009 | 1.03 | 65 | 67,365 | |||||||||||||||||
Gas Distribution 0.66% | |||||||||||||||||||||||
KeySpan Gas East Corp | 7.875 | % | 2/1/2010 | 1.44 | 300 | 315,496 | |||||||||||||||||
Northern Natural Gas Co.† | 6.75 | % | 9/15/2008 | 0.20 | 400 | 402,123 | |||||||||||||||||
Total | 717,619 | ||||||||||||||||||||||
Health Services 0.55% | |||||||||||||||||||||||
UnitedHealth Group Inc. | 5.125 | % | 11/15/2010 | 2.18 | 300 | 297,285 | |||||||||||||||||
WellPoint, Inc. | 5.00 | % | 1/15/2011 | 2.29 | 300 | 296,656 | |||||||||||||||||
Total | 593,941 | ||||||||||||||||||||||
Investments & Miscellaneous Financial Services 1.13% | |||||||||||||||||||||||
Bank of America Corp. | 5.375 | % | 8/15/2011 | 2.79 | 250 | 253,798 | |||||||||||||||||
Fiserv, Inc. | 6.125 | % | 11/20/2012 | 3.77 | 300 | 301,802 |
See Notes to Financial Statements.
21
Schedule of Investments (unaudited)(continued)
DEVELOPING LOCAL MARKETS FUND June 30, 2008
Investments | Interest Rate | Maturity Date | Modified Duration | Principal Amount (000) | Value | ||||||||||||||||||
Investments & Miscellaneous Financial Services (continued) | |||||||||||||||||||||||
Goldman Sachs Group, Inc. | 4.50 | % | 6/15/2010 | 1.84 | $ | 350 | $ | 350,631 | |||||||||||||||
Xstrata Finance Ltd. (Canada)†(a) | 5.50 | % | 11/16/2011 | 3.01 | 320 | 316,778 | |||||||||||||||||
Total | 1,223,009 | ||||||||||||||||||||||
Media: Broadcast 0.12% | |||||||||||||||||||||||
Cox Communications, Inc. | 7.75 | % | 11/1/2010 | 2.10 | 125 | 131,781 | |||||||||||||||||
Media: Cable 0.26% | |||||||||||||||||||||||
Comcast Corp. | 5.85 | % | 1/15/2010 | 1.42 | 275 | 279,315 | |||||||||||||||||
Media: Diversified 0.09% | |||||||||||||||||||||||
Grupo Televisa SA (Mexico)†(a) | 6.00 | % | 5/15/2018 | 7.27 | 100 | 97,754 | |||||||||||||||||
Metals/Mining Excluding Steel 0.23% | |||||||||||||||||||||||
BHP Billiton Ltd. (Australia)(a) | 5.125 | % | 3/29/2012 | 3.32 | 250 | 249,496 | |||||||||||||||||
Railroads 0.24% | |||||||||||||||||||||||
CSX Corp. | 6.75 | % | 3/15/2011 | 2.41 | 250 | 259,247 | |||||||||||||||||
Steel Producers/Products 0.02% | |||||||||||||||||||||||
Allegheny Technologies Inc. | 8.375 | % | 12/15/2011 | 2.97 | 25 | 26,490 | |||||||||||||||||
Support: Services 0.06% | |||||||||||||||||||||||
Corrections Corp. of America | 7.50 | % | 5/1/2011 | 0.79 | 60 | 60,600 | |||||||||||||||||
Telecommunications: Integrated/Services 1.84% | |||||||||||||||||||||||
AT&T, Inc. | 5.30 | % | 11/15/2010 | 2.17 | 275 | 281,390 | |||||||||||||||||
British Telecommunications plc (United Kingdom)(a) | 8.625 | % | 12/15/2010 | 2.20 | 250 | 268,586 | |||||||||||||||||
Deutsche Telekom International Finance B.V.(Netherlands)(a) | 8.50 | %# | 6/15/2010 | 1.79 | 275 | 291,050 | |||||||||||||||||
France Telecom SA (France)(a) | 7.75 | % | 3/1/2011 | 2.34 | 275 | 291,412 | |||||||||||||||||
SK Telecom Co. Ltd. (Korea)†(a) | 4.25 | % | 4/1/2011 | 2.53 | 500 | 485,664 | |||||||||||||||||
Telecom Italia Capital SpA (Luxembourg)(a) | 5.25 | % | 11/15/2013 | 4.55 | 250 | 236,432 | |||||||||||||||||
Telefonica Europe BV (Netherlands)(a) | 7.75 | % | 9/15/2010 | 1.98 | 125 | 131,811 | |||||||||||||||||
Total | 1,986,345 | ||||||||||||||||||||||
Total Corporate Bonds (cost $7,469,480) | 7,484,165 |
See Notes to Financial Statements.
22
Schedule of Investments (unaudited)(continued)
DEVELOPING LOCAL MARKETS FUND June 30, 2008
Investments | Interest Rate | Maturity Date | Modified Duration | Principal Amount (000) | Value | ||||||||||||||||||
FOREIGN BONDS(b) 5.51% | |||||||||||||||||||||||
Hungary 0.96% | |||||||||||||||||||||||
Hungary Government Bond | 6.50 | % | 8/12/2008 | 0.10 | HUF | 155,000 | $ | 1,033,575 | |||||||||||||||
Mexico 2.37% | |||||||||||||||||||||||
Mexican Cetes | Zero Coupon | 8/14/2008 | 11.84 | MXN | 2,670 | 2,565,752 | |||||||||||||||||
Nigeria 0.66% | |||||||||||||||||||||||
Nigeria Treasury Bond | 12.50 | % | 2/24/2009 | 0.60 | NGN | 81,000 | 719,832 | ||||||||||||||||
Poland 1.52% | |||||||||||||||||||||||
Poland Government Bond | Zero Coupon | 12/12/2008 | 0.43 | PLN | 3,600 | 1,640,943 | |||||||||||||||||
Total Foreign Bonds (cost $5,923,724) | 5,960,102 | ||||||||||||||||||||||
GOVERNMENT SPONSORED ENTERPRISES BONDS 0.22% | |||||||||||||||||||||||
Brazilian Government International Bond (Brazil)(a) | 6.00 | % | 1/17/2017 | 6.46 | $ | 100 | 102,200 | ||||||||||||||||
Jamaica Government International Bond (Jamaica)(a) | 8.00 | % | 6/24/2019 | 6.57 | 120 | 109,800 | |||||||||||||||||
Panama Government International Bond (Panama)(a) | 7.25 | % | 3/15/2015 | 5.22 | 30 | 32,400 | |||||||||||||||||
Total Government Sponsored Enterprises Bonds (cost $254,608) | 244,400 | ||||||||||||||||||||||
GOVERNMENT SPONSORED ENTERPRISES PASS-THROUGHS 1.90% | |||||||||||||||||||||||
Federal Home Loan Mortgage Corp. | 7.00 | % | 2/1/2032 | 3.95 | 55 | 58,140 | |||||||||||||||||
Federal Home Loan Mortgage Corp.(c) | 5.718 | %# | 11/1/2037 | 2.38 | 877 | 886,604 | |||||||||||||||||
Federal National Mortgage Assoc. | 5.927 | %# | 5/1/2036 | 1.75 | 228 | 232,739 | |||||||||||||||||
Federal National Mortgage Assoc. | 5.485 | %# | 4/1/2036 | 1.56 | 252 | 256,764 | |||||||||||||||||
Federal National Mortgage Assoc. | 5.52 | %# | 4/1/2036 | 1.64 | 127 | 129,002 | |||||||||||||||||
Federal National Mortgage Assoc. | 5.661 | %# | 8/1/2036 | 2.02 | 476 | 486,952 | |||||||||||||||||
Total Government Sponsored Enterprises Pass-Throughs (cost $2,046,938) | 2,050,201 | ||||||||||||||||||||||
NON-AGENCY COMMERCIAL MORTGAGE-BACKED SECURITIES 47.23% | |||||||||||||||||||||||
Banc of America Commercial Mortgage Inc. 2003-1 A1 | 3.878 | % | 9/11/2036 | 1.66 | 385 | 377,492 | |||||||||||||||||
Banc of America Commercial Mortgage Inc. 2004-2 A2 | 3.52 | % | 11/10/2038 | 0.46 | 1,267 | 1,260,346 | |||||||||||||||||
Banc of America Commercial Mortgage Inc. 2004-4 A3 | 4.128 | % | 7/10/2042 | 0.96 | 1,700 | 1,690,890 |
See Notes to Financial Statements.
23
Schedule of Investments (unaudited)(continued)
DEVELOPING LOCAL MARKETS FUND June 30, 2008
Investments | Interest Rate | Maturity Date | Modified Duration | Principal Amount (000) | Value | ||||||||||||||||||
NON-AGENCY COMMERCIAL MORTGAGE-BACKED SECURITIES (continued) | |||||||||||||||||||||||
Banc of America Commercial Mortgage Inc. 2005-1 A3 | 4.877 | % | 11/10/2042 | 1.45 | $ | 105 | $ | 104,877 | |||||||||||||||
Banc of America Commercial Mortgage Inc. 2006-2 A1 | 5.611 | % | 5/10/2045 | 1.58 | 1,135 | 1,142,324 | |||||||||||||||||
Banc of America Commercial Mortgage Inc. 2006-3 A1 | 5.685 | % | 7/10/2044 | 1.34 | 144 | 145,428 | |||||||||||||||||
Banc of America Commercial Mortgage Inc.2005-3 A2 | 4.501 | % | 7/10/2043 | 1.71 | 1,772 | 1,754,024 | |||||||||||||||||
Bear Stearns Commercial Mortgage 2002-T6 A1 | 5.92 | % | 10/15/2036 | 1.08 | 576 | 583,164 | |||||||||||||||||
Bear Stearns Commercial Mortgage 2004-PWR3 A1 | 4.361 | % | 6/11/2041 | 0.81 | 1,243 | 1,240,248 | |||||||||||||||||
Bear Stearns Commercial Mortgage 2004-PWR6 A2 | 4.133 | % | 11/11/2041 | 0.97 | 1,475 | 1,467,108 | |||||||||||||||||
Bear Stearns Commercial Mortgage 2004-T14 A2 | 4.17 | % | 1/12/2041 | 0.50 | 568 | 566,515 | |||||||||||||||||
Bear Stearns Commercial Mortgage 2005-PW10 A2 | 5.27 | % | 12/11/2040 | 2.14 | 1,280 | 1,280,023 | |||||||||||||||||
Bear Stearns Commercial Mortgage 2005-PWR7 A2 | 4.945 | % | 2/11/2041 | 2.84 | 125 | 122,907 | |||||||||||||||||
Bear Stearns Commercial Mortgage 2005-PWR8 A1 | 4.212 | % | 6/11/2041 | 0.93 | 335 | 333,458 | |||||||||||||||||
Bear Stearns Commercial Mortgage 2005-T20 A1 | 4.94 | % | 10/12/2042 | 1.18 | 693 | 694,064 | |||||||||||||||||
Bear Stearns Commercial Mortgage 2005-T20 A2 | 5.127 | %# | 10/12/2042 | 1.95 | 285 | 284,560 | |||||||||||||||||
Bear Stearns Commercial Mortgage 2006-PW11 A1 | 5.266 | % | 3/11/2039 | 1.72 | 755 | 754,547 | |||||||||||||||||
Bear Stearns Commercial Mortgage 2006-PW12 A1 | 5.546 | %# | 9/11/2038 | 1.50 | 1,215 | 1,221,801 | |||||||||||||||||
Bear Stearns Commercial Mortgage 2006-T22 A1 | 5.415 | %# | 4/12/2038 | 1.38 | 623 | 625,323 | |||||||||||||||||
Citigroup Commercial Mortgage Trust 2005-C3 A2 | 4.639 | % | 5/15/2043 | 1.51 | 1,240 | 1,232,211 | |||||||||||||||||
Citigroup/Deutsche Bank Commercial Mortgage Trust 2006-CD2 AAB | 5.575 | %# | 1/15/2046 | 4.16 | 920 | 891,123 | |||||||||||||||||
Commercial Mortgage Pass-Through Certificates 2005-C6 A1 | 4.735 | % | 6/10/2044 | 0.81 | 720 | 720,693 | |||||||||||||||||
Credit Suisse Mortgage Capital Certificates 2006-C3 A1 | 4.991 | % | 6/15/2038 | 1.57 | 108 | 107,448 |
See Notes to Financial Statements.
24
Schedule of Investments (unaudited)(continued)
DEVELOPING LOCAL MARKETS FUND June 30, 2008
Investments | Interest Rate | Maturity Date | Modified Duration | Principal Amount (000) | Value | ||||||||||||||||||
NON-AGENCY COMMERCIAL MORTGAGE-BACKED SECURITIES (continued) | |||||||||||||||||||||||
CS First Boston Mortgage Securities Corp. 2003-CK2 A2 | 3.861 | % | 3/15/2036 | 0.84 | $ | 383 | $ | 379,979 | |||||||||||||||
CS First Boston Mortgage Securities Corp. 2004-C3 A2 | 3.913 | % | 7/15/2036 | 0.46 | 573 | 571,125 | |||||||||||||||||
CS First Boston Mortgage Securities Corp. 2004-C5 A2 | 4.183 | % | 11/15/2037 | 1.21 | 1,375 | 1,364,465 | |||||||||||||||||
CS First Boston Mortgage Securities Corp. 2005-C1 A2 | 4.609 | % | 2/15/2038 | 1.49 | 500 | 497,107 | |||||||||||||||||
CS First Boston Mortgage Securities Corp. 2005-C2 A2 | 4.577 | % | 4/15/2037 | 1.67 | 1,122 | 1,112,544 | |||||||||||||||||
CS First Boston Mortgage Securities Corp. 2005-C6 A1 | 4.938 | % | 12/15/2040 | 1.03 | 746 | 747,484 | |||||||||||||||||
GE Capital Commercial Mortgage Corp. 2004-C1 A2 | 3.915 | % | 11/10/2038 | 1.19 | 25 | 24,736 | |||||||||||||||||
GE Capital Commercial Mortgage Corp. 2004-C2 A2 | 4.119 | % | 3/10/2040 | 1.35 | 400 | 395,939 | |||||||||||||||||
GE Capital Commercial Mortgage Corp. 2004-C3 A2 | 4.433 | % | 7/10/2039 | 0.92 | 600 | 598,894 | |||||||||||||||||
GE Capital Commercial Mortgage Corp. 2005-C4 A1 | 5.082 | % | 11/10/2045 | 1.36 | 638 | 639,766 | |||||||||||||||||
GMAC Commercial Mortgage Securities Inc 2006-C1 A1 | 4.975 | % | 11/10/2045 | 1.31 | 250 | 249,589 | |||||||||||||||||
GMAC Commercial Mortgage Securities Inc. 2003-C1 A1 | 3.337 | % | 5/10/2036 | 2.20 | 827 | 793,368 | |||||||||||||||||
GMAC Commercial Mortgage Securities Inc. 2003-C2 A1 | 4.576 | % | 5/10/2040 | 2.83 | 508 | 495,628 | |||||||||||||||||
Greenwich Capital Commercial Funding Corp. 2003-C2 A2 | 4.022 | % | 1/5/2036 | 0.73 | 865 | 861,292 | |||||||||||||||||
Greenwich Capital Commercial Funding Corp. 2005-GG5 A2 | 5.117 | % | 4/10/2037 | 1.99 | 210 | 209,703 | |||||||||||||||||
Greenwich Capital Commercial Funding Corp. 2007-GG9 A1 | 5.233 | % | 3/10/2039 | 1.93 | 435 | 431,789 | |||||||||||||||||
GS Mortgage Securities Corp. II 2004-C1 A1 | 3.659 | % | 10/10/2028 | 0.38 | 132 | 131,753 | |||||||||||||||||
GS Mortgage Securities Corp. II 2004-GG2 A2 | 4.293 | % | 8/10/2038 | 0.51 | 139 | 138,439 | |||||||||||||||||
GS Mortgage Securities Corp. II 2006-GG6 A2 | 5.506 | %# | 4/10/2038 | 2.23 | 200 | 199,930 | |||||||||||||||||
JP Morgan Chase Commercial Mortgage Securities Corp. 2004-C3 A1 | 3.765 | % | 1/15/2042 | 0.64 | 654 | 650,434 |
See Notes to Financial Statements.
25
Schedule of Investments (unaudited)(continued)
DEVELOPING LOCAL MARKETS FUND June 30, 2008
Investments | Interest Rate | Maturity Date | Modified Duration | Principal Amount (000) | Value | ||||||||||||||||||
NON-AGENCY COMMERCIAL MORTGAGE-BACKED SECURITIES (continued) | |||||||||||||||||||||||
JP Morgan Chase Commercial Mortgage Securities Corp. 2004-C3 A2 | 4.223 | % | 1/15/2042 | 1.38 | $ | 265 | $ | 262,550 | |||||||||||||||
JP Morgan Chase Commercial Mortgage Securities Corp. 2004-LN2 A1 | 4.475 | % | 7/15/2041 | 2.37 | 929 | 909,869 | |||||||||||||||||
JP Morgan Chase Commercial Mortgage Securities Corp. 2005-LDP1 A1 | 4.116 | % | 3/15/2046 | 0.42 | 501 | 499,593 | |||||||||||||||||
JP Morgan Chase Commercial Mortgage Securities Corp. 2005-LDP2 A2 | 4.575 | % | 7/15/2042 | 1.73 | 1,000 | 990,688 | |||||||||||||||||
JP Morgan Chase Commercial Mortgage Securities Corp. 2005-LDP3 A2 | 4.851 | % | 8/15/2042 | 1.89 | 395 | 392,433 | |||||||||||||||||
JP Morgan Chase Commercial Mortgage Securities Corp. 2005-LDP5 A1 | 5.035 | % | 12/15/2044 | 0.74 | 379 | 379,603 | |||||||||||||||||
JP Morgan Chase Commercial Mortgage Securities Corp. 2006-LDP6 ASB | 5.49 | %# | 4/15/2043 | 4.08 | 990 | 961,845 | |||||||||||||||||
LB-UBS Commercial Mortgage Trust 2002-C2 A2 | 4.904 | % | 6/15/2026 | 0.42 | 446 | 446,612 | |||||||||||||||||
LB-UBS Commercial Mortgage Trust 2003-C7 A2 | 4.064 | %# | 9/15/2027 | 1.18 | 284 | 281,520 | |||||||||||||||||
LB-UBS Commercial Mortgage Trust 2003-C8 A1 | 3.636 | % | 11/15/2027 | 0.05 | 478 | 477,789 | |||||||||||||||||
LB-UBS Commercial Mortgage Trust 2003-C8 A2 | 4.207 | % | 11/15/2027 | 0.51 | 1,055 | 1,053,419 | |||||||||||||||||
LB-UBS Commercial Mortgage Trust 2004-C1 A1 | 2.964 | % | 1/15/2029 | 0.15 | 181 | 180,593 | |||||||||||||||||
LB-UBS Commercial Mortgage Trust 2004-C2 A2 | 3.246 | % | 3/15/2029 | 0.55 | 400 | 397,154 | |||||||||||||||||
LB-UBS Commercial Mortgage Trust 2004-C6 A2 | 4.187 | % | 8/15/2029 | 0.98 | 1,000 | 995,225 | |||||||||||||||||
LB-UBS Commercial Mortgage Trust 2004-C7 A2 | 3.992 | % | 10/15/2029 | 1.21 | 915 | 906,698 | |||||||||||||||||
LB-UBS Commercial Mortgage Trust 2006-C7 A1 | 5.279 | % | 11/15/2038 | 1.88 | 223 | 222,549 | |||||||||||||||||
Merrill Lynch Mortgage Trust 2005-CKII A1 | 5.077 | % | 11/12/2037 | 1.04 | 702 | 703,895 | |||||||||||||||||
Merrill Lynch Mortgage Trust 2005-LC1 ASB | 5.282 | %# | 1/12/2044 | 3.54 | 70 | 68,646 | |||||||||||||||||
Merrill Lynch Mortgage Trust 2005-MKB2 A1 | 4.446 | % | 9/12/2042 | 0.53 | 34 | 34,302 | |||||||||||||||||
Merrill Lynch Mortgage Trust 2006-C1 A1 | 5.528 | %# | 5/12/2039 | 1.31 | 1,286 | 1,292,842 |
See Notes to Financial Statements.
26
Schedule of Investments (unaudited)(continued)
DEVELOPING LOCAL MARKETS FUND June 30, 2008
Investments | Interest Rate | Maturity Date | Modified Duration | Principal Amount (000) | Value | ||||||||||||||||||
NON-AGENCY COMMERCIAL MORTGAGE-BACKED SECURITIES (continued) | |||||||||||||||||||||||
Merrill Lynch Mortgage Trust 2006-C1 A2 | 5.613 | %# | 5/12/2039 | 2.46 | $ | 1,380 | $ | 1,381,796 | |||||||||||||||
Merrill Lynch/Countrywide Commercial Mortgage Trust 2006-1 A2 | 5.439 | %# | 2/12/2039 | 2.32 | 875 | 872,089 | |||||||||||||||||
Merrill Lynch/Countrywide Commercial Mortgage Trust 2007-7 A1 | 5.549 | % | 6/12/2050 | 1.94 | 1,400 | 1,396,670 | |||||||||||||||||
Morgan Stanley Capital I 2004-HQ3 A2 | 4.05 | % | 1/13/2041 | 1.29 | 924 | 914,691 | |||||||||||||||||
Morgan Stanley Capital I 2004-T15 A2 | 4.69 | % | 6/13/2041 | 1.36 | 600 | 598,305 | |||||||||||||||||
Morgan Stanley Capital I 2006-T23 A1 | 5.682 | % | 8/12/2041 | 1.87 | 128 | 128,661 | |||||||||||||||||
Morgan Stanley Capital I 2007-IQ14 A1 | 5.38 | % | 4/15/2049 | 2.37 | 1,061 | 1,048,834 | |||||||||||||||||
Option One Mortgage Loan Trust 2007-D2 IIA1 | 5.90 | % | 3/25/2037 | 1.20 | 209 | 207,228 | |||||||||||||||||
Wachovia Bank Commercial Mortgage Trust 2003-C8 A1 | 3.444 | % | 11/15/2035 | 0.17 | 1,603 | 1,598,670 | |||||||||||||||||
Wachovia Bank Commercial Mortgage Trust 2004-C14 A2 | 4.368 | % | 8/15/2041 | 1.29 | 1,500 | 1,490,147 | |||||||||||||||||
Wachovia Bank Commercial Mortgage Trust 2004-C15 A2 | 4.039 | % | 10/15/2041 | 1.29 | 465 | 459,976 | |||||||||||||||||
Wachovia Bank Commercial Mortgage Trust 2004-C16 A2 | 4.38 | % | 10/15/2041 | 1.25 | 245 | 243,449 | |||||||||||||||||
Wachovia Bank Commercial Mortgage Trust 2006-C23 A2 | 5.416 | % | 1/15/2045 | 2.28 | 170 | 169,302 | |||||||||||||||||
Total Non-Agency Commercial Mortgage-Backed Securities (cost $50,683,524) | 51,062,181 | ||||||||||||||||||||||
Total Long-Term Investments (cost $103,097,348) | 103,647,165 | ||||||||||||||||||||||
SHORT-TERM INVESTMENTS 1.67% | |||||||||||||||||||||||
Government Sponsored Enterprises Securities 1.58% | |||||||||||||||||||||||
Federal Home Loan Bank Discount Notes | 2.00 | % | 7/1/2008 | 1,709 | 1,709,000 | ||||||||||||||||||
Repurchase Agreement 0.09% | |||||||||||||||||||||||
Repurchase Agreement dated 6/30/2008, 1.68% due 7/1/2008 with State Street Bank & Trust Co. collateralized by $105,000 of Federal Home Loan Mortgage Corp. at 3.65% due 6/18/2010; value: $105,263; proceeds: $100,426 | 100 | 100,422 | |||||||||||||||||||||
Total Short-Term Investments (cost $1,809,422) | 1,809,422 | ||||||||||||||||||||||
Total Investments in Securities 97.53% (cost $104,906,765) | 105,456,587 | ||||||||||||||||||||||
Foreign Cash and Other Assets in Excess of Liabilities(d) 2.47% | 2,665,374 | ||||||||||||||||||||||
Net Assets 100.00% | $ | 108,121,961 |
See Notes to Financial Statements.
27
Schedule of Investments (unaudited)(continued)
DEVELOPING LOCAL MARKETS FUND June 30, 2008
# Variable rate security. The interest rate represents the rate at June 30, 2008.
† Security was purchased pursuant to Rule 144A under the Securities Act of 1933 or is a private placement and, unless registered under the Act or exempted from registration, may only be resold to qualified institutional investors. Unless otherwise noted, 144A securities are deemed to be liquid.
(a) Foreign security traded in U.S. dollars.
(b) Investment in non-U.S. dollar denominated securities.
(c) Security pledged as collateral for open futures contracts as of June 30, 2008.
(d) Foreign Cash and Other Assets in Excess of Liabilities include net unrealized appreciation (depreciation) on futures contracts and forward currency exchange contracts, as follows:
Open Futures Contracts Open as of June 30, 2008: | |||||||||||||||||||||||
Type | Expiration | Contracts | Position | Market Value | Unrealized Appreciation/ (Depreciation) | ||||||||||||||||||
U.S. 2-Year Treasury Note | September 2008 | 15,000 | Short | $ | (15,840,234 | ) | $ | (51,448 | ) | ||||||||||||||
U.S. 5-Year Treasury Note | September 2008 | 16,400 | Short | (18,130,969 | ) | (118,411 | ) | ||||||||||||||||
Totals | $ | (33,971,203 | ) | $ | (169,859 | ) |
Forward Foreign Currency Contracts Open as of June 30, 2008: |
Forward Foreign Currency Contracts | Transaction Type | Expiration Date | Foreign Currency | U.S. $ Cost on Origination Date | U.S. $ Current Value | Unrealized Appreciation/ (Depreciation) | |||||||||||||||||||||
Argentine Peso | Buy | 8/1/2008 | 1,635,000 | $ | 521,285 | $ | 535,273 | $ | 13,987 | ||||||||||||||||||
Argentine Peso | Buy | 9/2/2008 | 1,800,000 | 552,995 | 583,053 | 30,057 | |||||||||||||||||||||
Brazilian Real | Sell | 7/3/2008 | 5,100,000 | 3,161,245 | 3,178,909 | (17,663 | ) | ||||||||||||||||||||
Brazilian Real | Buy | 7/3/2008 | 5,100,000 | 2,991,306 | 3,178,909 | 187,603 | |||||||||||||||||||||
Brazilian Real | Buy | 8/1/2008 | 760,000 | 447,774 | 470,259 | 22,485 | |||||||||||||||||||||
Brazilian Real | Sell | 8/1/2008 | 760,000 | 458,494 | 470,259 | (11,765 | ) | ||||||||||||||||||||
Brazilian Real | Buy | 9/2/2008 | 1,935,000 | 1,153,659 | 1,188,295 | 34,637 | |||||||||||||||||||||
Brazilian Real | Buy | 10/6/2008 | 2,600,000 | 1,545,779 | 1,582,314 | 36,535 | |||||||||||||||||||||
Brazilian Real | Buy | 11/5/2008 | 3,700,000 | 2,244,465 | 2,235,341 | (9,123 | ) | ||||||||||||||||||||
Chilean Peso | Buy | 8/1/2008 | 599,450,000 | 1,281,553 | 1,140,373 | (141,180 | ) | ||||||||||||||||||||
Chilean Peso | Buy | 9/2/2008 | 533,200,000 | 1,098,796 | 1,012,105 | (86,691 | ) | ||||||||||||||||||||
Chilean Peso | Buy | 10/6/2008 | 483,000,000 | 997,048 | 914,716 | (82,332 | ) | ||||||||||||||||||||
Chinese Yuan Renminbi | Buy | 7/3/2008 | 14,200,000 | 2,052,182 | 2,072,380 | 20,198 | |||||||||||||||||||||
Chinese Yuan Renminbi | Sell | 7/3/2008 | 14,200,000 | 2,069,247 | 2,072,380 | (3,133 | ) | ||||||||||||||||||||
Chinese Yuan Renminbi | Buy | 11/5/2008 | 15,200,000 | 2,258,041 | 2,263,231 | 5,191 | |||||||||||||||||||||
Colombian Peso | Buy | 7/3/2008 | 785,000,000 | 444,256 | 409,899 | (34,357 | ) | ||||||||||||||||||||
Colombian Peso | Sell | 7/3/2008 | 785,000,000 | 402,564 | 409,899 | (7,335 | ) | ||||||||||||||||||||
Colombian Peso | Buy | 8/1/2008 | 1,050,775,000 | 593,426 | 544,266 | (49,160 | ) | ||||||||||||||||||||
Colombian Peso | Sell | 8/1/2008 | 1,050,775,000 | 544,161 | 544,266 | (105 | ) | ||||||||||||||||||||
Colombian Peso | Buy | 9/2/2008 | 416,700,000 | 247,521 | 213,988 | (33,533 | ) | ||||||||||||||||||||
Colombian Peso | Buy | 11/5/2008 | 785,000,000 | 393,090 | 397,714 | 4,624 | |||||||||||||||||||||
Czech Koruna | Buy | 7/3/2008 | 41,700,000 | 2,597,897 | 2,748,478 | 150,581 | |||||||||||||||||||||
Czech Koruna | Sell | 7/3/2008 | 41,700,000 | 2,706,244 | 2,748,478 | (42,234 | ) |
See Notes to Financial Statements.
28
Schedule of Investments (unaudited)(continued)
DEVELOPING LOCAL MARKETS FUND June 30, 2008
Forward Foreign Currency Contracts | Transaction Type | Expiration Date | Foreign Currency | U.S. $ Cost on Origination Date | U.S. $ Current Value | Unrealized Appreciation/ (Depreciation) | |||||||||||||||||||||
Czech Koruna | Buy | 8/1/2008 | 20,635,000 | $ | 1,302,140 | $ | 1,358,620 | $ | 56,480 | ||||||||||||||||||
Czech Koruna | Buy | 10/6/2008 | 32,700,000 | 2,052,034 | 2,148,004 | 95,970 | |||||||||||||||||||||
Czech Koruna | Sell | 10/6/2008 | 7,500,000 | 475,044 | 492,661 | (17,617 | ) | ||||||||||||||||||||
Czech Koruna | Buy | 11/5/2008 | 16,300,000 | 1,070,889 | 1,069,633 | (1,256 | ) | ||||||||||||||||||||
Hong Kong Dollar | Buy | 7/3/2008 | 24,500,000 | 3,146,734 | 3,142,338 | (4,396 | ) | ||||||||||||||||||||
Hong Kong Dollar | Sell | 7/3/2008 | 24,500,000 | 3,142,395 | 3,142,338 | 57 | |||||||||||||||||||||
Hong Kong Dollar | Buy | 8/1/2008 | 33,060,000 | 4,258,772 | 4,242,886 | (15,886 | ) | ||||||||||||||||||||
Hong Kong Dollar | Buy | 10/6/2008 | 22,100,000 | 2,839,149 | 2,839,554 | 405 | |||||||||||||||||||||
Hong Kong Dollar | Buy | 11/5/2008 | 30,900,000 | 3,972,016 | 3,971,733 | (283 | ) | ||||||||||||||||||||
Hungarian Forint | Buy | 7/3/2008 | 280,000,000 | 1,532,987 | 1,871,224 | 338,237 | |||||||||||||||||||||
Hungarian Forint | Sell | 7/3/2008 | 280,000,000 | 1,816,567 | 1,871,224 | (54,656 | ) | ||||||||||||||||||||
Hungarian Forint | Buy | 8/1/2008 | 520,000,000 | 3,210,351 | 3,458,577 | 248,226 | |||||||||||||||||||||
Hungarian Forint | Buy | 11/5/2008 | 57,000,000 | 374,139 | 373,873 | (265 | ) | ||||||||||||||||||||
Indian Rupee | Buy | 7/3/2008 | 33,400,000 | 810,272 | 775,835 | (34,437 | ) | ||||||||||||||||||||
Indian Rupee | Sell | 7/3/2008 | 38,600,000 | 897,674 | 896,623 | 1,051 | |||||||||||||||||||||
Indian Rupee | Buy | 8/1/2008 | 91,000,000 | 2,162,919 | 2,101,895 | (61,024 | ) | ||||||||||||||||||||
Indian Rupee | Buy | 9/2/2008 | 42,000,000 | 1,025,391 | 965,318 | (60,073 | ) | ||||||||||||||||||||
Indonesian Rupiah | Sell | 7/3/2008 | 16,200,000,000 | 1,757,213 | 1,756,137 | 1,075 | |||||||||||||||||||||
Indonesian Rupiah | Buy | 7/3/2008 | 17,100,000,000 | 1,836,556 | 1,853,701 | 17,145 | |||||||||||||||||||||
Indonesian Rupiah | Buy | 8/1/2008 | 5,535,000,000 | 591,968 | 597,018 | 5,049 | |||||||||||||||||||||
Indonesian Rupiah | Buy | 10/6/2008 | 12,000,000,000 | 1,263,158 | 1,277,905 | 14,747 | |||||||||||||||||||||
Indonesian Rupiah | Buy | 11/5/2008 | 13,700,000,000 | 1,465,084 | 1,450,930 | (14,154 | ) | ||||||||||||||||||||
Israeli New Shekel | Sell | 7/3/2008 | 6,555,000 | 1,950,220 | 1,957,878 | (7,658 | ) | ||||||||||||||||||||
Israeli New Shekel | Buy | 7/3/2008 | 6,555,000 | 1,843,239 | 1,957,878 | 114,639 | |||||||||||||||||||||
Israeli New Shekel | Buy | 8/1/2008 | 9,600,000 | 2,800,015 | 2,863,167 | 63,152 | |||||||||||||||||||||
Israeli New Shekel | Buy | 11/5/2008 | 4,355,000 | 1,289,053 | 1,293,897 | 4,844 | |||||||||||||||||||||
Malaysian Ringgit | Buy | 8/1/2008 | 4,350,000 | 1,352,876 | 1,331,442 | (21,433 | ) | ||||||||||||||||||||
Malaysian Ringgit | Sell | 9/2/2008 | 3,400,000 | 1,040,169 | 1,040,831 | (662 | ) | ||||||||||||||||||||
Malaysian Ringgit | Buy | 9/2/2008 | 6,400,000 | 2,034,653 | 1,959,212 | (75,441 | ) | ||||||||||||||||||||
Malaysian Ringgit | Buy | 10/6/2008 | 2,920,000 | 904,585 | 894,062 | (10,522 | ) | ||||||||||||||||||||
Mexican Peso | Sell | 7/3/2008 | 30,100,000 | 2,889,316 | 2,917,314 | (27,998 | ) | ||||||||||||||||||||
Mexican Peso | Buy | 7/3/2008 | 30,100,000 | 2,784,728 | 2,917,314 | 132,585 | |||||||||||||||||||||
Mexican Peso | Buy | 8/5/2008 | 34,225,000 | 3,191,273 | 3,301,069 | 109,795 | |||||||||||||||||||||
Mexican Peso | Buy | 9/9/2008 | 36,000,000 | 3,391,772 | 3,455,503 | 63,731 | |||||||||||||||||||||
Mexican Peso | Buy | 11/5/2008 | 17,500,000 | 1,667,715 | 1,666,570 | (1,145 | ) | ||||||||||||||||||||
New Romanian Leu | Buy | 8/1/2008 | 1,070,000 | 445,786 | 458,876 | 13,090 | |||||||||||||||||||||
New Romanian Leu | Buy | 9/2/2008 | 2,175,000 | 895,919 | 926,196 | 30,277 | |||||||||||||||||||||
New Romanian Leu | Buy | 10/6/2008 | 3,350,000 | 1,392,819 | 1,415,689 | 22,870 | |||||||||||||||||||||
New Russian Ruble | Sell | 7/3/2008 | 52,700,000 | 2,250,213 | 2,246,773 | 3,440 | |||||||||||||||||||||
New Russian Ruble | Buy | 7/3/2008 | 52,700,000 | 2,210,848 | 2,246,773 | 35,926 | |||||||||||||||||||||
New Russian Ruble | Buy | 8/1/2008 | 35,200,000 | 1,481,855 | 1,499,918 | 18,062 | |||||||||||||||||||||
New Russian Ruble | Buy | 10/6/2008 | 39,800,000 | 1,671,040 | 1,691,552 | 20,511 | |||||||||||||||||||||
New Russian Ruble | Buy | 11/5/2008 | 55,200,000 | 2,346,141 | 2,342,565 | (3,575 | ) |
See Notes to Financial Statements.
29
Schedule of Investments (unaudited)(concluded)
DEVELOPING LOCAL MARKETS FUND June 30, 2008
Forward Foreign Currency Contracts | Transaction Type | Expiration Date | Foreign Currency | U.S. $ Cost on Origination Date | U.S. $ Current Value | Unrealized Appreciation/ (Depreciation) | |||||||||||||||||||||
New Turkish Lira | Sell | 7/3/2008 | 4,390,000 | $ | 3,586,601 | $ | 3,583,097 | $ | 3,504 | ||||||||||||||||||
New Turkish Lira | Buy | 7/3/2008 | 4,390,000 | 3,446,089 | 3,583,097 | 137,008 | |||||||||||||||||||||
New Turkish Lira | Sell | 8/1/2008 | 469,000 | 368,711 | 378,319 | (9,608 | ) | ||||||||||||||||||||
New Turkish Lira | Buy | 8/1/2008 | 4,539,000 | 3,505,851 | 3,661,383 | 155,532 | |||||||||||||||||||||
New Turkish Lira | Buy | 9/2/2008 | 2,410,000 | 1,875,093 | 1,917,988 | 42,895 | |||||||||||||||||||||
New Turkish Lira | Buy | 11/5/2008 | 4,540,000 | 3,523,477 | 3,516,757 | (6,720 | ) | ||||||||||||||||||||
Peruvian Nuevo Sol | Sell | 8/1/2008 | 340,000 | 122,523 | 114,733 | 7,789 | |||||||||||||||||||||
Peruvian Nuevo Sol | Buy | 8/1/2008 | 340,000 | 123,659 | 114,733 | (8,926 | ) | ||||||||||||||||||||
Peruvian Nuevo Sol | Sell | 9/2/2008 | 340,000 | 698,847 | 654,381 | 44,466 | |||||||||||||||||||||
Peruvian Nuevo Sol | Buy | 9/2/2008 | 1,940,000 | 706,019 | 654,381 | (51,638 | ) | ||||||||||||||||||||
Philippine Peso | Sell | 7/3/2008 | 30,100,000 | 689,983 | 670,308 | 19,675 | |||||||||||||||||||||
Philippine Peso | Buy | 7/3/2008 | 30,100,000 | 735,405 | 670,308 | (65,097 | ) | ||||||||||||||||||||
Philippine Peso | Buy | 8/1/2008 | 62,700,000 | 1,408,605 | 1,393,351 | (15,254 | ) | ||||||||||||||||||||
Philippine Peso | Sell | 9/2/2008 | 16,900,000 | 380,631 | 374,517 | 6,113 | |||||||||||||||||||||
Philippine Peso | Buy | 9/2/2008 | 51,500,000 | 1,171,588 | 1,141,280 | (30,308 | ) | ||||||||||||||||||||
Polish Zloty | Sell | 7/3/2008 | 8,770,000 | 4,115,246 | 4,114,072 | 1,174 | |||||||||||||||||||||
Polish Zloty | Buy | 7/3/2008 | 8,770,000 | 3,837,268 | 4,114,072 | 276,803 | |||||||||||||||||||||
Polish Zloty | Buy | 8/1/2008 | 13,215,000 | 5,988,553 | 6,180,914 | 192,361 | |||||||||||||||||||||
Polish Zloty | Buy | 11/5/2008 | 6,910,000 | 3,205,875 | 3,204,501 | (1,374 | ) | ||||||||||||||||||||
Singapore Dollar | Sell | 7/3/2008 | 4,337,790 | 3,188,145 | 3,188,716 | (571 | ) | ||||||||||||||||||||
Singapore Dollar | Buy | 7/3/2008 | 4,337,790 | 3,133,159 | 3,188,716 | 55,556 | |||||||||||||||||||||
Singapore Dollar | Buy | 8/1/2008 | 2,290,000 | 1,684,905 | 1,685,694 | 788 | |||||||||||||||||||||
Singapore Dollar | Buy | 9/5/2008 | 8,080,000 | 5,939,767 | 5,956,981 | 17,214 | |||||||||||||||||||||
Singapore Dollar | Buy | 11/5/2008 | 5,000,000 | 3,695,218 | 3,695,925 | 707 | |||||||||||||||||||||
Slovak Koruna | Buy | 8/1/2008 | 2,323,000 | 112,330 | 120,900 | 8,570 | |||||||||||||||||||||
Slovak Koruna | Buy | 9/2/2008 | 27,050,000 | 1,324,863 | 1,405,946 | 81,083 | |||||||||||||||||||||
South African Rand | Sell | 7/3/2008 | 6,600,000 | 845,287 | 842,194 | 3,093 | |||||||||||||||||||||
South African Rand | Buy | 7/3/2008 | 6,600,000 | 842,209 | 842,194 | (15 | ) | ||||||||||||||||||||
South African Rand | Buy | 8/1/2008 | 11,975,000 | 1,475,532 | 1,515,636 | 40,104 | |||||||||||||||||||||
South African Rand | Buy | 10/6/2008 | 12,525,000 | 1,572,031 | 1,558,422 | (13,609 | ) | ||||||||||||||||||||
South African Rand | Buy | 11/5/2008 | 13,600,000 | 1,685,463 | 1,678,625 | (6,838 | ) | ||||||||||||||||||||
Taiwan Dollar | Buy | 10/6/2008 | 16,000,000 | 532,623 | 531,762 | (861 | ) | ||||||||||||||||||||
Thai Baht | Buy | 11/5/2008 | 73,000,000 | 2,175,857 | 2,178,131 | 2,274 | |||||||||||||||||||||
Total Unrealized Appreciation on Forward Foreign Currency Contracts | $ | 1,872,060 |
See Notes to Financial Statements.
30
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31
Statements of Assets and Liabilities (unaudited)
June 30, 2008
Global Allocation Fund* | Developing Local Markets Fund | ||||||||||
ASSETS: | |||||||||||
Investments in securities, at cost | $ | 110,128,312 | $ | 104,906,765 | |||||||
Investments in securities, at value | $ | 108,611,725 | $ | 105,456,587 | |||||||
Foreign cash, at value (cost $413,664 and $116,855, respectively) | 435,509 | 117,629 | |||||||||
Deposits with brokers for futures contracts | – | 231,500 | |||||||||
Receivables: | |||||||||||
Interest and dividends | 222,551 | 504,756 | |||||||||
Investment securities sold | 1,834,431 | – | |||||||||
Paydown recievable | – | 60,757 | |||||||||
Capital shares sold | 108,911 | 2,220,125 | |||||||||
From advisor (See Note 3) | 12,088 | 5 | |||||||||
Unrealized appreciation on forward foreign currency contracts | – | 3,013,971 | |||||||||
Prepaid expenses and other assets | 46,595 | 55,247 | |||||||||
Total assets | 111,271,810 | 111,660,577 | |||||||||
LIABILITIES: | |||||||||||
Payables: | |||||||||||
Investment securities purchased | 1,933,862 | 1,431,358 | |||||||||
Capital shares reacquired | 164,924 | 135,124 | |||||||||
Management fees | 68,283 | 40,094 | |||||||||
12b-1 distribution fees | 50,571 | 44,840 | |||||||||
Fund administration | 3,657 | 3,215 | |||||||||
Directors' fees | 28,788 | 44,080 | |||||||||
Variation margin on future contracts | – | 256,598 | |||||||||
Payable for open forward currency contracts | – | 1,141,911 | |||||||||
Distributions payable | 284 | 236,480 | |||||||||
Accrued expenses and other liabilities | 93,163 | 204,916 | |||||||||
Total liabilities | 2,343,532 | 3,538,616 | |||||||||
NET ASSETS | $ | 108,928,278 | $ | 108,121,961 | |||||||
COMPOSITION OF NET ASSETS: | |||||||||||
Paid-in capital | $ | 109,597,898 | $ | 109,668,298 | |||||||
Undistributed net investment income | 592,244 | 1,567,489 | |||||||||
Accumulated net realized gain (loss) on investments, futures contracts and foreign currency related transactions | 233,295 | (5,380,257 | ) | ||||||||
Net unrealized appreciation (depreciation) on investments, futures contracts and translation of assets and liabilities denominated in foreign currencies | (1,495,159 | ) | 2,266,431 | ||||||||
Net Assets | $ | 108,928,278 | $ | 108,121,961 |
* Formerly, Global Equity Fund
See Notes to Financial Statements.
32
Statements of Assets and Liabilities (unaudited)(concluded)
June 30, 2008
Global Allocation Fund* | Developing Local Markets Fund | ||||||||||
Net assets by class: | |||||||||||
Class A Shares | $ | 82,469,994 | $ | 78,333,241 | |||||||
Class B Shares | $ | 11,014,202 | $ | 4,674,488 | |||||||
Class C Shares | $ | 14,721,691 | $ | 14,223,395 | |||||||
Class F Shares | $ | 13,222 | $ | 615,747 | |||||||
Class I Shares | $ | 689,404 | $ | 10,242,142 | |||||||
Class P Shares | – | $ | 10,755 | ||||||||
Class R2 Shares | $ | 9,882 | $ | 11,093 | |||||||
Class R3 Shares | $ | 9,882 | $ | 11,100 | |||||||
Outstanding shares by class: | |||||||||||
Class A Shares (430 million and 415 million shares of common stock authorized, $.001 par value) | 7,181,656 | 10,999,666 | |||||||||
Class B Shares (15 million and 30 million shares of common stock authorized, $.001 par value) | 1,034,058 | 655,171 | |||||||||
Class C Shares (20 million and 20 million shares of common stock authorized, $.001 par value) | 1,379,164 | 1,991,150 | |||||||||
Class F Shares (20 million and 20 million shares of common stock authorized, $.001 par value) | 1,152 | 86,611 | |||||||||
Class I Shares (15 million and 15 million shares of common stock authorized, $.001 par value) | 59,803 | 1,437,109 | |||||||||
Class P Shares (20 million and 20 million shares of common stock authorized, $.001 par value) | – | 1,515 | |||||||||
Class R2 Shares (20 million and 20 million shares of common stock authorized, $.001 par value) | 861 | 1,557 | |||||||||
Class R3 Shares (20 million and 20 million shares of common stock authorized, $.001 par value) | 861 | 1,558 | |||||||||
Net asset value, offering and redemption price per share (Net assets divided by outstanding shares): | |||||||||||
Class A Shares–Net asset value | $ | 11.48 | $ | 7.12 | |||||||
Class A Shares–Maximum offering price (Net asset value plus sales charge of 5.75% and 4.75%, respectively) | $ | 12.18 | $ | 7.48 | |||||||
Class B Shares–Net asset value | $ | 10.65 | $ | 7.13 | |||||||
Class C Shares–Net asset value | $ | 10.67 | $ | 7.14 | |||||||
Class F Shares–Net asset value | $ | 11.48 | $ | 7.11 | |||||||
Class I Shares–Net asset value | $ | 11.53 | $ | 7.13 | |||||||
Class P Shares–Net asset value | – | $ | 7.10 | ||||||||
Class R2 Shares–Net asset value | $ | 11.48 | $ | 7.12 | |||||||
Class R3 Shares–Net asset value | $ | 11.48 | $ | 7.12 |
* Formerly, Global Equity Fund
See Notes to Financial Statements.
33
Statements of Operations (unaudited)
For the Six Months Ended June 30, 2008
Global Allocation Fund* | Developing Local Markets | ||||||||||
Investment income: | |||||||||||
Dividends (net of foreign withholding taxes of $104,089 and $0, respectively) | $ | 1,599,404 | $ | – | |||||||
Interest | 46,838 | 1,659,530 | |||||||||
Total investment income | 1,646,242 | 1,659,530 | |||||||||
Expenses: | |||||||||||
Management fees | 431,152 | 175,995 | |||||||||
12b-1 distribution plan–Class A | 152,768 | 95,495 | |||||||||
12b-1 distribution plan–Class B | 58,704 | 18,791 | |||||||||
12b-1 distribution plan–Class C | 75,973 | 41,336 | |||||||||
12b-1 distribution plan–Class F | 5 | 29 | |||||||||
12b-1 distribution plan–Class P | – | 23 | |||||||||
12b-1 distribution plan–Class R2 | 1 | 32 | |||||||||
12b-1 distribution plan–Class R3 | 1 | 26 | |||||||||
Shareholder servicing | 186,189 | 49,304 | |||||||||
Professional | 30,497 | 29,062 | |||||||||
Reports to shareholders | 26,313 | 20,239 | |||||||||
Fund administration | 22,995 | 14,080 | |||||||||
Custody | 43,593 | 11,134 | |||||||||
Directors' fees | 1,443 | 737 | |||||||||
Registration | 39,766 | 51,057 | |||||||||
Other | 3,906 | – | |||||||||
Gross expenses | 1,073,306 | 507,340 | |||||||||
Expense reductions (See Note 7) | (946 | ) | (1,946 | ) | |||||||
Expenses assumed by advisor (See Note 7) | (66,322 | ) | (37,510 | ) | |||||||
Net expenses | 1,006,038 | 467,884 | |||||||||
Net investment income | 640,204 | 1,191,646 | |||||||||
Net realized and unrealized gain (loss): | |||||||||||
Net realized gain on investments and foreign currency related transactions (net of foreign capital gains tax) | 429,405 | 3,294,580 | |||||||||
Net change in unrealized appreciation on investments, futures contracts, and translation of assets and liabilities denominated in foreign currencies | (15,115,803 | ) | 730,371 | ||||||||
Net realized and unrealized gain (loss) | (14,686,398 | ) | 4,024,951 | ||||||||
Net Increase (Decrease) in Net Assets Resulting From Operations | $ | (14,046,194 | ) | $ | 5,216,597 |
* Formerly, Global Equity Fund
See Notes to Financial Statements.
34
Statements of Changes in Net Assets
Global Allocation Fund* | |||||||||||
INCREASE (DECREASE) IN NET ASSETS | For the Six Months Ended June 30, 2008 (unaudited) | For the Year Ended December 31, 2007 | |||||||||
Operations: | |||||||||||
Net investment income | $ | 640,204 | $ | 353,275 | |||||||
Net realized gain (loss) on investments and foreign currency related transactions | 429,405 | 12,750,606 | |||||||||
Net change in unrealized appreciation (depreciation) on investments and translation of assets and liabilities denominated in foreign currencies | (15,115,803 | ) | (350,004 | ) | |||||||
Net increase in net assets resulting from operations | (14,046,194 | ) | 12,753,877 | ||||||||
Net investment income | |||||||||||
Class A | – | (188,552 | ) | ||||||||
Class B | – | – | |||||||||
Class C | – | – | |||||||||
Class F | – | (47 | ) | ||||||||
Class I | – | (4,225 | ) | ||||||||
Net realized gain | |||||||||||
Class A | (1,330,734 | ) | (9,949,992 | ) | |||||||
Class B | (190,934 | ) | (1,436,997 | ) | |||||||
Class C | (255,528 | ) | (1,803,400 | ) | |||||||
Class F | (212 | ) | (868 | ) | |||||||
Class I | (11,072 | ) | (81,544 | ) | |||||||
Class R2 | (159 | ) | – | ||||||||
Class R3 | (159 | ) | – | ||||||||
Total distributions to shareholders | (1,788,798 | ) | (13,465,625 | ) | |||||||
Capital share transactions (Net of share conversions) (See Note 11): | |||||||||||
Net proceeds from sales of shares | 11,608,509 | 26,278,759 | |||||||||
Reinvestment of distributions | 1,711,657 | 12,889,477 | |||||||||
Cost of shares reacquired | (12,449,407 | ) | (22,396,093 | ) | |||||||
Net increase (decrease) in net assets resulting from capital share transactions | 870,759 | 16,772,143 | |||||||||
Net increase (decrease) in net assets | (14,964,233 | ) | 16,060,395 | ||||||||
NET ASSETS: | |||||||||||
Beginning of period | $ | 123,892,511 | $ | 107,832,116 | |||||||
End of period | $ | 108,928,278 | $ | 123,892,511 | |||||||
Undistributed (distributions in excess of) net investment income | $ | 592,244 | $ | (47,960 | ) |
* Formerly, Global Equity Fund
See Notes to Financial Statements.
35
Statements of Changes in Net Assets (concluded)
Developing Local Markets Fund | |||||||||||
INCREASE (DECREASE) IN NET ASSETS | For the Six Months Ended June 30, 2008 (unaudited) | For the Year Ended December 31, 2007 | |||||||||
Operations: | |||||||||||
Net investment income | $ | 1,191,646 | $ | 1,849,190 | |||||||
Net realized gain on investments, futures contracts and foreign currency related transactions | 3,294,580 | 2,395,847 | |||||||||
Net change in unrealized appreciation on investments, futures contracts and translation of assets and liabilities denominated in foreign currencies | 730,371 | (49,255 | ) | ||||||||
Net increase in net assets resulting from operations | 5,216,597 | 4,195,782 | |||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | |||||||||||
Class A | (903,195 | ) | (4,222,377 | ) | |||||||
Class B | (50,337 | ) | (292,105 | ) | |||||||
Class C | (109,890 | ) | (517,997 | ) | |||||||
Class F | (1,104 | ) | (630 | ) | |||||||
Class I | (69,664 | ) | (88,523 | ) | |||||||
Class P | (162 | ) | (799 | ) | |||||||
Class R2 | (163 | ) | (618 | ) | |||||||
Class R3 | (170 | ) | (621 | ) | |||||||
Total distributions to shareholders | (1,134,685 | ) | (5,123,670 | ) | |||||||
Capital share transactions (Net of share conversions) (See Note 11): | |||||||||||
Net proceeds from sales of shares | 56,737,607 | 9,551,552 | |||||||||
Reinvestment of distributions | 890,198 | 4,343,294 | |||||||||
Cost of shares reacquired | (7,920,022 | ) | (20,867,881 | ) | |||||||
Net increase/(decrease) in net assets resulting from capital share transactions | 49,707,783 | (6,973,035 | ) | ||||||||
Net increase (decrease) in net assets | 53,789,695 | (7,900,923 | ) | ||||||||
NET ASSETS: | |||||||||||
Beginning of period | $ | 54,332,266 | $ | 62,233,189 | |||||||
End of period | $ | 108,121,961 | $ | 54,332,266 | |||||||
Undistributed net investment income | $ | 1,567,489 | $ | 1,510,528 |
See Notes to Financial Statements.
36
Financial Highlights
GLOBAL ALLOCATION FUND (formerly, Global Equity Fund)
Class A Shares | |||||||||||||||||||||||||||
Six Months Ended 6/30/2008 | Year Ended 12/31 | ||||||||||||||||||||||||||
(unaudited) | 2007 | 2006 | 2005 | 2004 | 2003 | ||||||||||||||||||||||
Per Share Operating Performance | |||||||||||||||||||||||||||
Net asset value, beginning of period | $ | 13.15 | $ | 13.17 | $ | 12.23 | $ | 11.75 | $ | 10.51 | $ | 8.33 | |||||||||||||||
Investment operations: | |||||||||||||||||||||||||||
Net investment income (loss)(a) | .08 | .06 | .05 | .05 | (.01 | ) | .04 | ||||||||||||||||||||
Net realized and unrealized gain | (1.56 | ) | 1.48 | 2.13 | .91 | 1.27 | 2.16 | ||||||||||||||||||||
Total income from operations | (1.48 | ) | 1.54 | 2.18 | .96 | 1.26 | 2.20 | ||||||||||||||||||||
Distributions to shareholders from: | |||||||||||||||||||||||||||
Net investment income | – | (.03 | ) | (.04 | ) | (.05 | ) | (.02 | ) | (.02 | ) | ||||||||||||||||
Net realized gains | (.19 | ) | (1.53 | ) | (1.20 | ) | (.43 | ) | – | – | |||||||||||||||||
Total distributions | (.19 | ) | (1.56 | ) | (1.24 | ) | (.48 | ) | (.02 | ) | (.02 | ) | |||||||||||||||
Net asset value, end of period | $ | 11.48 | $ | 13.15 | $ | 13.17 | $ | 12.23 | $ | 11.75 | $ | 10.51 | |||||||||||||||
Total Return(b) | (11.27 | )%(c) | 11.82 | % | 18.12 | % | 8.21 | % | 11.99 | % | 26.38 | % | |||||||||||||||
Ratios to Average Net Assets: | |||||||||||||||||||||||||||
Expenses, excluding expense reductions and including expenses assumed | .80 | %(c) | 1.60 | % | 1.60 | % | 1.60 | % | 2.05 | % | 1.95 | % | |||||||||||||||
Expenses, including expense reductions and expenses assumed | .80 | %(c) | 1.60 | % | 1.60 | % | 1.60 | % | 2.05 | % | 1.95 | % | |||||||||||||||
Expenses, excluding expense reductions and expenses assumed | .86 | %(c) | 1.71 | % | 1.83 | % | 1.94 | % | 2.05 | % | 1.95 | % | |||||||||||||||
Net investment income | .63 | %(c) | .45 | % | .36 | % | .43 | % | (.11 | )% | .45 | % | |||||||||||||||
Supplemental Data: | |||||||||||||||||||||||||||
Net assets, end of period (000's) | $ | 82,470 | $ | 94,321 | $ | 83,067 | $ | 67,807 | $ | 59,915 | $ | 52,828 | |||||||||||||||
Portfolio turnover rate | 34.27 | %(c) | 87.01 | % | 95.23 | % | 97.65 | % | 170.93 | % | 56.26 | % |
(a) Calculated using average shares outstanding during the period.
(b) Total return does not consider the effects of sales loads and assumes the reinvestment of all distributions.
(c) Not annualized.
See Notes to Financial Statements.
37
Financial Highlights (continued)
GLOBAL ALLOCATION FUND (formerly, Global Equity Fund)
Class B Shares | |||||||||||||||||||||||||||
Six Months Ended 6/30/2008 | Year Ended 12/31 | ||||||||||||||||||||||||||
(unaudited) | 2007 | 2006 | 2005 | 2004 | 2003 | ||||||||||||||||||||||
Per Share Operating Performance | |||||||||||||||||||||||||||
Net asset value, beginning of period | $ | 12.25 | $ | 12.42 | $ | 11.65 | $ | 11.24 | $ | 10.10 | $ | 8.04 | |||||||||||||||
Investment operations: | |||||||||||||||||||||||||||
Net investment income (loss)(a) | .04 | (.03 | ) | (.04 | ) | (.02 | ) | (.08 | ) | (.02 | ) | ||||||||||||||||
Net realized and unrealized gain | (1.45 | ) | 1.39 | 2.02 | .86 | 1.22 | 2.08 | ||||||||||||||||||||
Total from investment operations | (1.41 | ) | 1.36 | 1.98 | .84 | 1.14 | 2.06 | ||||||||||||||||||||
Distributions to shareholders from: | |||||||||||||||||||||||||||
From net investment income | – | – | (.01 | ) | – | – | – | ||||||||||||||||||||
Net realized gains | (.19 | ) | (1.53 | ) | (1.20 | ) | (.43 | ) | – | – | |||||||||||||||||
Total distributions | (.19 | ) | (1.53 | ) | (1.21 | ) | (.43 | ) | – | – | |||||||||||||||||
Net asset value, end of period | $ | 10.65 | $ | 12.25 | $ | 12.42 | $ | 11.65 | $ | 11.24 | $ | 10.10 | |||||||||||||||
Total Return(b) | (11.52 | )%(c) | 11.08 | % | 17.28 | % | 7.52 | % | 11.29 | % | 25.62 | % | |||||||||||||||
Ratios to Average Net Assets: | |||||||||||||||||||||||||||
Expenses, excluding expense reductions and including expenses assumed | 1.12 | %(c) | 2.25 | % | 2.25 | % | 2.25 | % | 2.69 | % | 2.61 | % | |||||||||||||||
Expenses, including expense reductions and expenses assumed | 1.12 | %(c) | 2.25 | % | 2.25 | % | 2.25 | % | 2.69 | % | 2.61 | % | |||||||||||||||
Expenses, excluding expense reductions and expenses assumed | 1.18 | %(c) | 2.36 | % | 2.48 | % | 2.58 | % | 2.69 | % | 2.61 | % | |||||||||||||||
Net investment income (loss) | .30 | %(c) | (.20 | )% | (.29 | )% | (.22 | )% | (.75 | )% | (.21 | )% | |||||||||||||||
Supplemental Data: | |||||||||||||||||||||||||||
Net assets, end of period (000's) | $ | 11,014 | $ | 12,653 | $ | 11,502 | $ | 9,064 | $ | 7,818 | $ | 6,033 | |||||||||||||||
Portfolio turnover rate | 34.27 | %(c) | 87.01 | % | 95.23 | % | 97.65 | % | 170.93 | % | 56.26 | % |
(a) Calculated using average shares outstanding during the period.
(b) Total return does not consider the effects of sales loads and assumes the reinvestment of all distributions.
(c) Not annualized.
See Notes to Financial Statements.
38
Financial Highlights (continued)
GLOBAL ALLOCATION FUND (formerly, Global Equity Fund)
Class C Shares | |||||||||||||||||||||||||||
Six Months Ended 6/30/2008 | Year Ended 12/31 | ||||||||||||||||||||||||||
(unaudited) | 2007 | 2006 | 2005 | 2004 | 2003 | ||||||||||||||||||||||
Per Share Operating Performance | |||||||||||||||||||||||||||
Net asset value, beginning of period | $ | 12.28 | $ | 12.44 | $ | 11.67 | $ | 11.25 | $ | 10.11 | $ | 8.06 | |||||||||||||||
Investment from operations: | |||||||||||||||||||||||||||
Net investment income (loss)(a) | .04 | (.03 | ) | (.04 | ) | (.02 | ) | (.08 | ) | (.02 | ) | ||||||||||||||||
Net realized and unrealized gain | (1.46 | ) | 1.40 | 2.02 | .87 | 1.22 | 2.07 | ||||||||||||||||||||
Total from investment operations | (1.42 | ) | 1.37 | 1.98 | .85 | 1.14 | 2.05 | ||||||||||||||||||||
Distributions to shareholders from: | |||||||||||||||||||||||||||
From net investment income | – | – | (.01 | ) | – | – | – | ||||||||||||||||||||
Net realized gains | (.19 | ) | (1.53 | ) | (1.20 | ) | (.43 | ) | – | – | |||||||||||||||||
Total distributions | (.19 | ) | (1.53 | ) | (1.21 | ) | (.43 | ) | – | – | |||||||||||||||||
Net asset value, end of period | $ | 10.67 | $ | 12.28 | $ | 12.44 | $ | 11.67 | $ | 11.25 | $ | 10.11 | |||||||||||||||
Total Return(b) | (11.58 | )%(c) | 11.14 | % | 17.25 | % | 7.61 | % | 11.28 | % | 25.59 | % | |||||||||||||||
Ratios to Average Net Assets: | |||||||||||||||||||||||||||
Expenses, excluding expense reductions and including expenses assumed | 1.12 | %(c) | 2.25 | % | 2.25 | % | 2.25 | % | 2.69 | % | 2.61 | % | |||||||||||||||
Expenses, including expense reductions and expenses assumed | 1.12 | %(c) | 2.25 | % | 2.25 | % | 2.25 | % | 2.69 | % | 2.61 | % | |||||||||||||||
Expenses, excluding expense reductions and expenses assumed | 1.18 | %(c) | 2.36 | % | 2.48 | % | 2.58 | % | 2.69 | % | 2.61 | % | |||||||||||||||
Net investment income (loss) | .31 | %(c) | (.20 | )% | (.30 | )% | (.22 | )% | (.75 | )% | (.29 | )% | |||||||||||||||
Supplemental Data: | |||||||||||||||||||||||||||
Net assets, end of period (000's) | $ | 14,722 | $ | 16,104 | $ | 12,681 | $ | 8,991 | $ | 7,158 | $ | 4,111 | |||||||||||||||
Portfolio turnover rate | 34.27 | %(c) | 87.01 | % | 95.23 | % | 97.65 | % | 170.93 | % | 56.26 | % |
(a) Calculated using average shares outstanding during the period.
(b) Total return does not consider the effects of sales loads and assumes the reinvestment of all distributions.
(c) Not annualized.
See Notes to Financial Statements.
39
Financial Highlights (continued)
GLOBAL ALLOCATION FUND (formerly, Global Equity Fund)
Class F Shares | |||||||||||
Six Months Ended 6/30/2008 (unaudited) | 9/28/2007(a) to 12/31/2007 | ||||||||||
Per Share Operating Performance | |||||||||||
Net asset value, beginning of period | $ | 13.12 | $ | 14.71 | |||||||
Investment operations: | |||||||||||
Net investment income(b) | .09 | .01 | |||||||||
Net realized and unrealized loss | (1.54 | ) | (.26 | ) | |||||||
Total loss from operations | (1.45 | ) | (.25 | ) | |||||||
Distributions to shareholders from: | |||||||||||
From net investment income | – | (.07 | ) | ||||||||
Net realized gains | (.19 | ) | (1.27 | ) | |||||||
Total distributions | (.19 | ) | (1.34 | ) | |||||||
Net asset value, end of period | $ | 11.48 | $ | 13.12 | |||||||
Total Return(c) | (11.06 | )%(d) | (1.67 | )%(d) | |||||||
Ratio to Average Net Assets: | |||||||||||
Expenses, excluding expense reductions and including expenses assumed | .66 | %(d) | .30 | %(d) | |||||||
Expenses, including expense reductions and expenses assumed | .66 | %(d) | .30 | %(d) | |||||||
Expenses, excluding expense reductions and expenses assumed | .72 | %(d) | .39 | %(d) | |||||||
Net investment income | .76 | %(d) | .04 | %(d) | |||||||
Supplemental Data: | |||||||||||
Net assets, end of period (000's) | $ | 13 | $ | 10 | |||||||
Portfolio turnover rate | 34.27 | %(d) | 87.01 | %(d) |
(a) Commencement of investment operations was September 28, 2007, SEC effective date was September 14, 2007, and date shares first became available to the public was October 1, 2007.
(b) Calculated using average shares outstanding during the period.
(c) Total return does not consider the effects of sales loads and assumes the reinvestment of all distributions.
(d) Not annualized.
See Notes to Financial Statements.
40
Financial Highlights (continued)
GLOBAL ALLOCATION FUND (formerly, Global Equity Fund)
Class I Shares | |||||||||||||||||||||||
Six Months Ended 6/30/2008 | Year Ended 12/31 | 10/19/2004(a) to | |||||||||||||||||||||
(unaudited) | 2007 | 2006 | 2005 | 12/31/2004 | |||||||||||||||||||
Per Share Operating Performance | |||||||||||||||||||||||
Net asset value, beginning of period | $ | 13.18 | $ | 13.19 | $ | 12.25 | $ | 11.76 | $ | 10.54 | |||||||||||||
Investment from operations: | |||||||||||||||||||||||
Net investment income(b) | .10 | .11 | .09 | .09 | – | (d) | |||||||||||||||||
Net realized and unrealized gain | (1.56 | ) | 1.49 | 2.14 | (.92 | ) | 1.22 | ||||||||||||||||
Total from investment operations | (1.46 | ) | 1.60 | 2.23 | 1.01 | 1.22 | |||||||||||||||||
Distributions to shareholders from: | |||||||||||||||||||||||
From net investment income | – | (.08 | ) | (.09 | ) | (.09 | ) | – | |||||||||||||||
Net realized gains | (.19 | ) | (1.53 | ) | (1.20 | ) | (.43 | ) | – | ||||||||||||||
Total distributions | (.19 | ) | (1.61 | ) | (1.29 | ) | (.52 | ) | – | ||||||||||||||
Net asset value, end of period | $ | 11.53 | $ | 13.18 | $ | 13.19 | $ | 12.25 | $ | 11.76 | |||||||||||||
Total Return(c) | (11.09 | )%(e) | 12.25 | % | 18.46 | % | 8.64 | % | 11.57 | %(e) | |||||||||||||
Ratio to Average Net Assets: | |||||||||||||||||||||||
Expenses, excluding expense reductions and including expenses assumed | .62 | %(e) | 1.25 | % | 1.25 | % | 1.25 | % | .33 | %(e) | |||||||||||||
Expenses, including expense reductions and expenses assumed | .62 | %(e) | 1.25 | % | 1.25 | % | 1.25 | % | .33 | %(e) | |||||||||||||
Expenses, excluding expense reductions and expenses assumed | .68 | %(e) | 1.36 | % | 1.48 | % | 1.58 | % | .33 | %(e) | |||||||||||||
Net investment income | .80 | %(e) | .78 | % | .70 | % | .77 | % | .02 | %(e) | |||||||||||||
Supplemental Data: | |||||||||||||||||||||||
Net assets, end of period (000's) | $ | 689 | $ | 804 | $ | 582 | $ | 478 | $ | 460 | |||||||||||||
Portfolio turnover rate | 34.27 | %(e) | 87.01 | % | 95.23 | % | 97.65 | % | 170.93 | %(e) |
(a) Commencement of offering of class shares.
(b) Calculated using average shares outstanding during the period.
(c) Total return does not consider the effects of sales loads and assumes the reinvestment of all distributions.
(d) Amount is less than $.01.
(e) Not annualized.
See Notes to Financial Statements.
41
Financial Highlights (continued)
GLOBAL ALLOCATION FUND (formerly, Global Equity Fund)
Class R2 Shares | |||||||
6/24/2008(a) to 6/30/2008 (unaudited) | |||||||
Per Share Operating Performance | |||||||
Net asset value — beginning of period | $ | 11.83 | |||||
Investment operations: | |||||||
Net investment income(b) | – | (c) | |||||
Net realized and unrealized gain | (.16 | ) | |||||
Total from investment operations | (.16 | ) | |||||
Distributions to shareholders from: | |||||||
Net realized gains | (.19 | ) | |||||
Net asset value, end of period | $ | 11.48 | |||||
Total Return(d) | (1.37 | )%(e) | |||||
Ratios to Average Net Assets: | |||||||
Expenses, excluding expense reductions and including expenses assumed | .03 | %(e) | |||||
Expenses, including expense reductions and expenses assumed | .03 | %(e) | |||||
Expenses, excluding expense reductions and expenses assumed | .03 | %(e) | |||||
Net investment income | .01 | %(e) | |||||
Supplemental Data: | |||||||
Net assets, end of period (000's) | $ | 10 | |||||
Portfolio turnover rate | 34.27 | %(e) |
(a) Commencement of investment operations was June 24, 2008, SEC effective date was September 14, 2007, and date shares first became available to the public was July 1, 2008.
(b) Calculated using average shares outstanding during the period.
(c) Amount is less than $.01.
(d) Total return does not consider the effects of sales loads and assumes the reinvestment of all distributions.
(e) Not annualized.
See Notes to Financial Statements.
42
Financial Highlights (concluded)
GLOBAL ALLOCATION FUND (formerly, Global Equity Fund)
Class R3 Shares | |||||||
6/24/2008(a) to 6/30/2008 (unaudited) | |||||||
Per Share Operating Performance | |||||||
Net asset value — beginning of period | $ | 11.83 | |||||
Investment operations: | |||||||
Net investment income(b) | – | (c) | |||||
Net realized and unrealized gain | (.16 | ) | |||||
Total from investment operations | (.16 | ) | |||||
Distributions to shareholders from: | |||||||
Net realized gains | (.19 | ) | |||||
Net asset value, end of period | $ | 11.48 | |||||
Total Return(d) | (1.37 | )%(e) | |||||
Ratios to Average Net Assets: | |||||||
Expenses, excluding expense reductions and including expenses assumed | .03 | %(e) | |||||
Expenses, including expense reductions and expenses assumed | .03 | %(e) | |||||
Expenses, excluding expense reductions and expenses assumed | .03 | %(e) | |||||
Net investment income | .01 | %(e) | |||||
Supplemental Data: | |||||||
Net assets, end of period (000's) | $ | 10 | |||||
Portfolio turnover rate | 34.27 | %(e) |
(a) Commencement of investment operations was June 24, 2008, SEC effective date was September 14, 2007, and date shares first became available to the public was July 1, 2008.
(b) Calculated using average shares outstanding during the period.
(c) Amount is less than $.01.
(d) Total return does not consider the effects of sales loads and assumes the reinvestment of all distributions.
(e) Not annualized.
See Notes to Financial Statements.
43
Financial Highlights
DEVELOPING LOCAL MARKETS FUND
Class A Shares | |||||||||||||||||||||||||||
Six Months Ended 6/30/2008 | Year Ended 12/31 | ||||||||||||||||||||||||||
(unaudited) | 2007 | 2006 | 2005 | 2004 | 2003 | ||||||||||||||||||||||
Per Share Operating Performance | |||||||||||||||||||||||||||
Net asset value, beginning of period | $ | 6.73 | $ | 6.84 | $ | 6.80 | $ | 7.66 | $ | 7.43 | $ | 6.91 | |||||||||||||||
Investment operations: | |||||||||||||||||||||||||||
Net investment income(a) | .12 | .22 | .18 | .17 | .17 | .18 | |||||||||||||||||||||
Net realized and unrealized gain (loss) | .39 | .31 | .17 | (.59 | ) | .43 | .68 | ||||||||||||||||||||
Total from investment operations | .51 | .53 | .35 | (.42 | ) | .60 | .86 | ||||||||||||||||||||
Distributions to shareholders from: | |||||||||||||||||||||||||||
Net investment income | (.12 | ) | (.64 | ) | (.31 | ) | (.44 | ) | (.37 | ) | (.34 | ) | |||||||||||||||
Net asset value, end of period | $ | 7.12 | $ | 6.73 | $ | 6.84 | $ | 6.80 | $ | 7.66 | $ | 7.43 | |||||||||||||||
Total Return(b) | 7.55 | %(c) | 7.98 | % | 5.22 | % | (5.61 | )% | 8.40 | % | 12.79 | % | |||||||||||||||
Ratios to Average Net Assets: | |||||||||||||||||||||||||||
Expenses, excluding expense reductions and including expenses assumed | .61 | %(c) | 1.14 | % | 1.30 | % | 1.30 | % | 1.40 | % | 1.35 | % | |||||||||||||||
Expenses, including expense reductions and expenses assumed | .61 | %(c) | 1.14 | % | 1.30 | % | 1.30 | % | 1.40 | % | 1.35 | % | |||||||||||||||
Expenses, excluding expense reductions and expenses assumed | .67 | %(c) | 1.83 | % | 1.43 | % | 1.38 | % | 1.40 | % | 1.35 | % | |||||||||||||||
Net investment income | 1.72 | %(c) | 3.25 | % | 2.70 | % | 2.36 | % | 2.33 | % | 2.43 | % | |||||||||||||||
Supplemental Data: | |||||||||||||||||||||||||||
Net assets, end of period (000's) | $ | 78,333 | $ | 44,148 | $ | 50,398 | $ | 52,275 | $ | 55,821 | $ | 56,386 | |||||||||||||||
Portfolio turnover rate | 37.81 | %(c) | 301.30 | % | 271.35 | % | 194.12 | % | 260.11 | % | 239.18 | % |
(a) Calculated using average shares outstanding during the period.
(b) Total return does not consider the effects of sales loads and assumes the reinvestment of all distributions.
(c) Not annualized.
See Notes to Financial Statements.
44
Financial Highlights (continued)
DEVELOPING LOCAL MARKETS FUND
Class B Shares | |||||||||||||||||||||||||||
Six Months Ended 6/30/2008 | Year Ended 12/31 | ||||||||||||||||||||||||||
(unaudited) | 2007 | 2006 | 2005 | 2004 | 2003 | ||||||||||||||||||||||
Per Share Operating Performance | |||||||||||||||||||||||||||
Net asset value, beginning of period | $ | 6.74 | $ | 6.85 | $ | 6.80 | $ | 7.67 | $ | 7.45 | $ | 6.92 | |||||||||||||||
Investment operations: | |||||||||||||||||||||||||||
Net investment income(a) | .10 | .18 | .14 | .12 | .12 | .13 | |||||||||||||||||||||
Net realized and unrealized gain | .38 | .28 | .17 | (.60 | ) | .43 | .70 | ||||||||||||||||||||
Total from investment operations | .48 | .46 | .31 | (.48 | ) | .55 | .83 | ||||||||||||||||||||
Distributions to shareholders from: | |||||||||||||||||||||||||||
From net investment income | (.09 | ) | (.57 | ) | (.26 | ) | (.39 | ) | (.33 | ) | (.30 | ) | |||||||||||||||
Net asset value, end of period | $ | 7.13 | $ | 6.74 | $ | 6.85 | $ | 6.80 | $ | 7.67 | $ | 7.45 | |||||||||||||||
Total Return(b) | 7.35 | %(c) | 7.26 | % | 4.67 | % | (6.34 | )% | 7.58 | % | 12.22 | % | |||||||||||||||
Ratios to Average Net Assets: | |||||||||||||||||||||||||||
Expenses, excluding expense reductions and including expenses assumed | .93 | %(c) | 1.79 | % | 1.95 | % | 1.95 | % | 2.04 | % | 1.99 | % | |||||||||||||||
Expenses, including expense reductions and expenses assumed | .93 | %(c) | 1.79 | % | 1.95 | % | 1.95 | % | 2.04 | % | 1.99 | % | |||||||||||||||
Expenses, excluding expense reductions and expenses assumed | .99 | %(c) | 2.46 | % | 2.08 | % | 2.03 | % | 2.04 | % | 1.99 | % | |||||||||||||||
Net investment income | 1.41 | %(c) | 2.58 | % | 2.05 | % | 1.71 | % | 1.69 | % | 1.79 | % | |||||||||||||||
Supplemental Data: | |||||||||||||||||||||||||||
Net assets, end of period (000's) | $ | 4,674 | $ | 3,303 | $ | 4,184 | $ | 4,636 | $ | 5,291 | $ | 3,719 | |||||||||||||||
Portfolio turnover rate | 37.81 | %(c) | 301.30 | % | 271.35 | % | 194.12 | % | 260.11 | % | 239.18 | % |
(a) Calculated using average shares outstanding during the period.
(b) Total return does not consider the effects of sales loads and assumes the reinvestment of all distributions.
(c) Not annualized.
See Notes to Financial Statements.
45
Financial Highlights (continued)
DEVELOPING LOCAL MARKETS FUND
Class C Shares | |||||||||||||||||||||||||||
Six Months Ended 6/30/2008 | Year Ended 12/31 | ||||||||||||||||||||||||||
(unaudited) | 2007 | 2006 | 2005 | 2004 | 2003 | ||||||||||||||||||||||
Per Share Operating Performance | |||||||||||||||||||||||||||
Net asset value, beginning of period | $ | 6.75 | $ | 6.86 | $ | 6.81 | $ | 7.67 | $ | 7.45 | $ | 6.92 | |||||||||||||||
Investment from operations: | |||||||||||||||||||||||||||
Net investment income(a) | .10 | .18 | .14 | .12 | .12 | .13 | |||||||||||||||||||||
Net realized and unrealized gain | .38 | .30 | .17 | (.59 | ) | .43 | .70 | ||||||||||||||||||||
Total from investment operations | .48 | .48 | .31 | (.47 | ) | .55 | .83 | ||||||||||||||||||||
Distributions to shareholders from: | |||||||||||||||||||||||||||
From net investment income | (.09 | ) | (.59 | ) | (.26 | ) | (.39 | ) | (.33 | ) | (.30 | ) | |||||||||||||||
Net asset value, end of period | $ | 7.14 | $ | 6.75 | $ | 6.86 | $ | 6.81 | $ | 7.67 | $ | 7.45 | |||||||||||||||
Total Return(b) | 7.19 | %(c) | 7.27 | % | 4.66 | % | (6.20 | )% | 7.59 | % | 12.29 | % | |||||||||||||||
Ratios to Average Net Assets: | |||||||||||||||||||||||||||
Expenses, excluding expense reductions and including expenses assumed | .93 | %(c) | 1.79 | % | 1.95 | % | 1.95 | % | 2.04 | % | 1.99 | % | |||||||||||||||
Expenses, including expense reductions and expenses assumed | .93 | %(c) | 1.79 | % | 1.95 | % | 1.95 | % | 2.04 | % | 1.99 | % | |||||||||||||||
Expenses, excluding expense reductions and expenses assumed | .98 | %(c) | 2.47 | % | 2.08 | % | 2.02 | % | 2.04 | % | 1.99 | % | |||||||||||||||
Net investment income | 1.39 | %(c) | 2.60 | % | 2.05 | % | 1.70 | % | 1.69 | % | 1.79 | % | |||||||||||||||
Supplemental Data: | |||||||||||||||||||||||||||
Net assets, end of period (000's) | $ | 14,223 | $ | 5,952 | $ | 6,608 | $ | 7,004 | $ | 6,235 | $ | 5,212 | |||||||||||||||
Portfolio turnover rate | 37.81 | %(c) | 301.30 | % | 271.35 | % | 194.12 | % | 260.11 | % | 239.18 | % |
(a) Calculated using average shares outstanding during the period.
(b) Total return does not consider the effects of sales loads and assumes the reinvestment of all distributions.
(c) Not annualized.
See Notes to Financial Statements.
46
Financial Highlights (continued)
DEVELOPING LOCAL MARKETS FUND
Class F Shares | |||||||||||
Six Months Ended 6/30/2008 (unaudited) | 9/28/2007(a) to 12/31/2007 | ||||||||||
Per Share Operating Performance | |||||||||||
Net asset value, beginning of period | $ | 6.73 | $ | 6.92 | |||||||
Investment operations: | |||||||||||
Net investment income(b) | .13 | .07 | |||||||||
Net realized and unrealized gain | .38 | .17 | |||||||||
Total from investment operations | .51 | .24 | |||||||||
Distributions to shareholders from: | |||||||||||
From net investment income | (.13 | ) | (.43 | ) | |||||||
Net asset value, end of period | $ | 7.11 | $ | 6.73 | |||||||
Total Return(c) | 7.58 | %(d) | 3.56 | %(d) | |||||||
Ratio to Average Net Assets: | |||||||||||
Expenses, excluding expense reductions and including expenses assumed | .42 | %(d) | .16 | %(d) | |||||||
Expenses, including expense reductions and expenses assumed | .42 | %(d) | .16 | %(d) | |||||||
Expenses, excluding expense reductions and expenses assumed | .45 | %(d) | .17 | %(d) | |||||||
Net investment income | 1.88 | %(d) | 1.02 | %(d) | |||||||
Supplemental Data: | |||||||||||
Net assets, end of period (000's) | $ | 616 | $ | 10 | |||||||
Portfolio turnover rate | 37.81 | %(d) | 301.30 | %(d) |
(a) Commencement of investment operations was September 28, 2007; SEC effective date was September 14, 2007 and date shares first became available to the public was October 1, 2007.
(b) Calculated using average shares outstanding during the period.
(c) Total return does not consider the effects of sales loads and assumes the reinvestment of all distributions.
(d) Not annualized.
See Notes to Financial Statements.
47
Financial Highlights (continued)
DEVELOPING LOCAL MARKETS FUND
Class I Shares | |||||||||||||||||||||||
Six Months Ended 6/30/2008 | Year Ended 12/31 | 10/19/2004(a) to | |||||||||||||||||||||
(unaudited) | 2007 | 2006 | 2005 | 12/31/2004 | |||||||||||||||||||
Per Share Operating Performance | |||||||||||||||||||||||
Net asset value, beginning of period | $ | 6.73 | $ | 6.85 | $ | 6.80 | $ | 7.66 | $ | 7.38 | |||||||||||||
Investment from operations: | |||||||||||||||||||||||
Net investment income(b) | .14 | .25 | .21 | .20 | .04 | ||||||||||||||||||
Net realized and unrealized gain | .39 | .29 | .17 | (.60 | ) | .37 | |||||||||||||||||
Total from investment operations | .53 | .54 | .38 | (.40 | ) | .41 | |||||||||||||||||
Distributions to shareholders from: | |||||||||||||||||||||||
From net investment income | (.13 | ) | (.66 | ) | (.33 | ) | (.46 | ) | (.13 | ) | |||||||||||||
Net asset value, end of period | $ | 7.13 | $ | 6.73 | $ | 6.85 | $ | 6.80 | $ | 7.66 | |||||||||||||
Total Return(c) | 7.89 | %(d) | 8.20 | % | 5.75 | % | (5.28 | )% | 5.79 | %(d) | |||||||||||||
Ratio to Average Net Assets: | |||||||||||||||||||||||
Expenses, excluding expense reductions and including expenses assumed | .43 | %(d) | .77 | % | .95 | % | .95 | % | .21 | %(d) | |||||||||||||
Expenses, including expense reductions and expenses assumed | .43 | %(d) | .77 | % | .95 | % | .95 | % | .21 | %(d) | |||||||||||||
Expenses, excluding expense reductions and expenses assumed | .45 | %(d) | 1.45 | % | 1.08 | % | 1.03 | % | .21 | %(d) | |||||||||||||
Net investment income | 1.93 | %(d) | 3.64 | % | 3.03 | % | 2.71 | % | .57 | %(d) | |||||||||||||
Supplemental Data: | |||||||||||||||||||||||
Net assets, end of period (000's) | $ | 10,242 | $ | 888 | $ | 1041 | $ | 564 | $ | 577 | |||||||||||||
Portfolio turnover rate | 37.81 | %(d) | 301.30 | % | 271.35 | % | 194.12 | % | 260.11 | %(d) |
(a) Commencement of offering of class shares.
(b) Calculated using average shares outstanding during the period.
(c) Total return does not consider the effects of sales loads and assumes the reinvestment of all distributions.
(d) Not annualized.
See Notes to Financial Statements.
48
Financial Highlights (continued)
DEVELOPING LOCAL MARKETS FUND
Class P Shares | |||||||||||||||||||||||||||
Six Months Ended 6/30/2008 | Year Ended 12/31 | ||||||||||||||||||||||||||
(unaudited) | 2007 | 2006 | 2005 | 2004 | 2003 | ||||||||||||||||||||||
Per Share Operating Performance | |||||||||||||||||||||||||||
Net asset value, beginning of period | $ | 6.71 | $ | 6.82 | $ | 6.77 | $ | 7.59 | $ | 7.39 | $ | 6.87 | |||||||||||||||
Investment operations: | |||||||||||||||||||||||||||
Net investment income(a) | .12 | .22 | .18 | .16 | .16 | .17 | |||||||||||||||||||||
Net realized and unrealized gain | .38 | .30 | .17 | (.58 | ) | .36 | .69 | ||||||||||||||||||||
Total income from operations | .50 | .52 | .35 | (.42 | ) | .52 | .86 | ||||||||||||||||||||
Distributions to shareholders from: | |||||||||||||||||||||||||||
From net investment income | (.11 | ) | (.63 | ) | (.30 | ) | (.40 | ) | (.32 | ) | (.34 | ) | |||||||||||||||
Net asset value, end of period | $ | 7.10 | $ | 6.71 | $ | 6.82 | $ | 6.77 | $ | 7.59 | $ | 7.39 | |||||||||||||||
Total Return(b) | 7.51 | %(c) | 7.96 | % | 5.34 | % | (5.60 | )% | 7.34 | % | 12.78 | % | |||||||||||||||
Ratios to Average Net Assets: | |||||||||||||||||||||||||||
Expenses, excluding expense reductions and including expenses assumed | .65 | %(c) | 1.17 | % | 1.22 | % | 1.38 | % | 1.49 | % | 1.44 | % | |||||||||||||||
Expenses, including expense reductions and expenses assumed | .65 | %(c) | 1.17 | % | 1.22 | % | 1.38 | % | 1.49 | % | 1.44 | % | |||||||||||||||
Expenses, excluding expense reductions and expenses assumed | .72 | %(c) | 1.93 | % | 1.50 | % | 1.39 | % | 1.49 | % | 1.44 | % | |||||||||||||||
Net investment income | 1.71 | %(c) | 3.30 | % | 2.60 | % | 2.20 | % | 2.24 | % | 2.34 | % | |||||||||||||||
Supplemental Data: | |||||||||||||||||||||||||||
Net assets, end of period (000's) | $ | 11 | $ | 9 | $ | 2 | $ | 2 | $ | 2 | $ | 1,904 | |||||||||||||||
Portfolio turnover rate | 37.81 | %(c) | 301.30 | % | 271.35 | % | 194.12 | % | 260.11 | % | 239.18 | % |
(a) Calculated using average shares outstanding during the period.
(b) Total return does not consider the effects of sales loads and assumes the reinvestment of all distributions.
(c) Not annualized.
See Notes to Financial Statements.
49
Financial Highlights (continued)
DEVELOPING LOCAL MARKETS FUND
Class R2 Shares | |||||||||||
Six Months Ended 6/30/2008 (unaudited) | 9/28/2007(a) to 12/31/2007 | ||||||||||
Per Share Operating Performance | |||||||||||
Net asset value, beginning of period | $ | 6.73 | $ | 6.92 | |||||||
Investment operations: | |||||||||||
Net investment income(b) | .11 | .06 | |||||||||
Net realized and unrealized gain | .39 | .17 | |||||||||
Total from investment operations | .50 | .23 | |||||||||
Distributions to shareholders from: | |||||||||||
From net investment income | (.11 | ) | (.42 | ) | |||||||
Net asset value, end of period | $ | 7.12 | $ | 6.73 | |||||||
Total Return(c) | 7.42 | %(d) | 3.45 | %(d) | |||||||
Ratio to Average Net Assets: | |||||||||||
Expenses, excluding expense reductions and including expenses assumed | .73 | %(d) | .27 | %(d) | |||||||
Expenses, including expense reductions and expenses assumed | .73 | %(d) | .27 | %(d) | |||||||
Expenses, excluding expense reductions and expenses assumed | .80 | %(d) | .28 | %(d) | |||||||
Net investment income | 1.62 | %(d) | .92 | %(d) | |||||||
Supplemental Data: | |||||||||||
Net assets, end of period (000's) | $ | 11 | $ | 10 | |||||||
Portfolio turnover rate | 37.81 | %(d) | 301.30 | %(d) |
(a) Commencement of investment operations was September 28, 2007; SEC effective date was September 14, 2007 and date shares first became available to the public was October 1, 2007.
(b) Calculated using average shares outstanding during the period.
(c) Total return does not consider the effects of sales loads and assumes the reinvestment of all distributions.
(d) Not annualized.
See Notes to Financial Statements.
50
Financial Highlights (concluded)
DEVELOPING LOCAL MARKETS FUND
Class R3 Shares | |||||||||||
Six Months Ended 6/30/2008 (unaudited) | 9/28/2007(a) to 12/31/2007 | ||||||||||
Per Share Operating Performance | |||||||||||
Net asset value, beginning of period | $ | 6.73 | $ | 6.92 | |||||||
Investment operations: | |||||||||||
Net investment income(b) | .11 | .07 | |||||||||
Net realized and unrealized gain | .39 | .17 | |||||||||
Total from investment operations | .50 | .24 | |||||||||
Distributions to shareholders from: | |||||||||||
From net investment income | (.11 | ) | (.43 | ) | |||||||
Net asset value, end of period | $ | 7.12 | $ | 6.73 | |||||||
Total Return(c) | 7.48 | %(d) | 3.48 | %(d) | |||||||
Ratio to Average Net Assets: | |||||||||||
Expenses, excluding expense reductions and including expenses assumed | .68 | %(d) | .25 | %(d) | |||||||
Expenses, including expense reductions and expenses assumed | .68 | %(d) | .25 | %(d) | |||||||
Expenses, excluding expense reductions and expenses assumed | .75 | %(d) | .25 | %(d) | |||||||
Net investment income | 1.68 | %(d) | .95 | %(d) | |||||||
Supplemental Data: | |||||||||||
Net assets, end of period (000's) | $ | 11 | $ | 10 | |||||||
Portfolio turnover rate | 37.81 | %(d) | 301.30 | %(d) |
(a) Commencement of investment operations was September 28, 2007; SEC effective date was September 14, 2007 and date shares first became available to the public was October 1, 2007.
(b) Calculated using average shares outstanding during the period.
(c) Total return does not consider the effects of sales loads and assumes the reinvestment of all distributions.
(d) Not annualized.
See Notes to Financial Statements.
51
Notes to Financial Statements
1. ORGANIZATION
Lord Abbett Global Fund, Inc. (the "Company") is registered under the Investment Company Act of 1940 (the "Act") as an open-end management investment company incorporated under Maryland law on February 23, 1988. The Company consists of the following two portfolios ("the Funds") and their respective classes: Lord Abbett Global Allocation Fund ("Global Allocation Fund"; formerly, "Equity Series" or "Global Equity Fund"), Class A, B, C, F, I, R2 and R3 shares; and Lord Abbett Developing Local Markets Fund ("Developing Local Markets Fund"), Class A, B, C, F, I, P, R2 and R3 shares. As of the date of this report, no Class P shares have been issued for Global Allocation Fund. Global Allocation Fund is diversified as defined under the Act and Developing Local Markets Fund is non-diversified. As of October 1, 2007, Developing Local Markets Fund Class P shares were closed to substantially all new retirement and benefit plans and fee-based programs, w ith certain exceptions as set forth in the Fund's Prospectus.
Prior to adopting its current investment objective on July 1, 2008, Global Allocation Fund's investment objective was long-term growth of capital and income consistent with reasonable risk. The production of current income was a secondary consideration. Effective July 1, 2008, Global Allocation Fund's investment objective is total return. Developing Local Markets Fund's investment objective is to seek high total return. Effective July 1, 2008, the Global Allocation Fund invests in other mutual funds ("Underlying Funds") managed by Lord, Abbett & Co. LLC ("Lord Abbett"), as described in the current Prospectus.
Each class of shares has different expenses and dividends. A front-end sales charge is normally added to the Net Asset Value ("NAV") for Class A shares. There is no front-end sales charge in the case of the Classes B, C, F, I, P, R2 and R3 shares, although there may be a contingent deferred sales charge ("CDSC") as follows: Class A shares purchased without a sales charge and redeemed before the first day of the month in which the one-year anniversary of the purchase falls (subject to certain exceptions); Class B shares redeemed before the sixth anniversary of purchase; and Class C shares redeemed before the first anniversary of purchase. Class B shares will automatically convert to Class A shares on the 25th day of the month (or the next business day thereafter) following the eighth anniversary of the original purchase of Class B shares.
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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.
2. SIGNIFICANT ACCOUNTING POLICIES
(a) Investment Valuation–Securities traded on any recognized U.S. or non-U.S. exchange or on The NASDAQ Stock Market LLC are valued at the last sale price or official closing price on the exchange or system on which they are principally traded. Events occurring after the close of trading on non-U.S. exchanges may result in adjustments to the valuation of foreign securities to more accurately reflect their fair value as of the close of regular trading on the New York Stock Exchange LLC ("NYSE"). The Funds may rely on an independent fair valuation service in adjusting the valuations of foreign securities. Unlisted equity securities are valued at the last quoted sale price or, if no sale price is available, at the mean between the most
52
Notes to Financial Statements (continued)
recently quoted bid and asked prices. Fixed income securities are valued at the mean between the bid and asked prices on the basis of prices supplied by independent pricing services, which reflect broker/dealer supplied valuations and electronic data processing techniques. Exchange-traded options and futures contracts are valued at the last sale price in the market where they are principally traded. If no sale has occurred, the mean between the most recently quoted bid and asked prices is used. Securities for which market quotations are not readily available are valued at fair value as determined by management and approved in good faith by the Board of Directors. Short-term securities with 60 days or less remaining to maturity are valued using the amortized cost method, which approximates current market value.
(b) Security Transactions–Security transactions are recorded as of the date that the securities are purchased or sold (trade date). Realized gains and losses on sales of portfolio securities are calculated using the identified-cost method. Realized and unrealized gains (losses) are allocated to each class of shares based upon the relative proportion of net assets at the beginning of the day.
(c) Investment Income–Dividend income is recorded on the ex-dividend date. Interest income is recorded on the accrual basis. Discounts are accreted and premiums are amortized using the effective interest method. Withholding taxes on foreign dividends have been provided for in accordance with the Fund's understanding of the applicable country's tax rules and rates. Investment income is allocated to each class of shares based upon the relative proportion of net assets at the beginning of the day.
(d) Federal Taxes–It is the policy of each Fund to meet the requirements of Subchapter M of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all taxable income and capital gains to its shareholders. Therefore, no Federal income tax provision is required.
The Funds have adopted Financial Accounting Standards Board ("FASB") Interpretation No. 48 ("FIN 48"), Accounting for Uncertainty in Income Taxes. FIN 48 establishes financial accounting and disclosure requirements for recognition and measurement of tax positions taken or expected to be taken on an income tax return. The adoption of FIN 48 has not resulted in any changes in the Funds' net assets, results of operations and financial statement disclosures.
(e) Expenses–Expenses incurred by the Company that do not specifically relate to an individual fund are generally allocated to the Funds within the Company on a pro rata basis. Expenses, excluding class specific expenses, are allocated to each class of shares based upon the relative proportion of net assets at the beginning of the day. Class A, B, C, F, P, R2 and R3 shares bear their class specific share of all expenses and fees relating to the Fund's 12b-1 Distribution Plan.
(f) Foreign Transactions–The books and records of the Funds are maintained in U.S. dollars and transactions denominated in foreign currencies are recorded in each Fund's records at the rate prevailing when earned or recorded. Asset and liability accounts that are denominated in foreign currencies are adjusted to reflect current exchange rates. The resultant exchange gains and losses are included in Net realized gain on investments and foreign currency related transactions on each Fund's Statement of Operations. Each Fund does not isolate that portion of the results of operations arising as a result of changes in the foreign exchange rates from the changes in market prices of the securities.
53
Notes to Financial Statements (continued)
(g) Forward Foreign Currency Exchange Contracts–Each Fund may invest substantially in forward foreign currency contracts or other derivatives, such as options, futures contracts, and swap agreements. U.S. fixed income instruments are used to "cover" the Developing Local Markets Fund's net exposure under forward contracts and other instruments that provide investment exposure to the currencies of developing markets. A forward foreign currency exchange contract is a commitment to purchase or sell a foreign currency at a future date at a negotiated rate. Forward contracts may also be structured for cash settlement rather than physical delivery. The contracts are valued daily at forward exchange rates and any unrealized gain (loss) is included in Net change in unrealized appreciati on on investments and translation of assets and liabilities denominated in foreign currencies on each Fund's Statement of Operations. The gain (loss) arising from the difference between the U.S. dollar cost of the original contract and the value of the foreign currency in U.S. dollars upon closing of such contracts is included in Net realized gain on investments and foreign currency related transactions on the Statement of Operations.
(h) Futures Contracts–Developing Local Markets Fund may purchase and sell futures contracts for bona fide hedging purposes including hedging against changes in interest rates and securities prices. At the time of entering into a futures transaction, an investor is required to deposit and maintain a specified amount of cash or eligible securities called "initial margin." Subsequent payments called "variation margin" are made on a daily basis as the market price of the futures contract fluctuates. The Fund will record an unrealized gain (loss) based on the amount of variation margin. When a contract is closed, a realized gain (loss) is recorded equal to the difference between the opening and closing value of the contract. Generally, open futures contracts are marked to market for Federal income tax purposes at fiscal year-end.
(i) When-Issued or Forward Transactions–Developing Local Markets Fund may purchase securities on a when-issued or forward basis. When-issued, forward transactions or to-be-announced ("TBA") transactions involve a commitment by a fund to purchase securities, with payment and delivery ("settlement") to take place in the future, in order to secure what is considered to be an advantageous price or yield at the time of entering into the transaction. During the period between purchase and settlement, the value of the securities will fluctuate and assets consisting of cash and/or marketable securities (normally short-term U.S. Government or U.S. Government sponsored enterprise securities) marked to market daily in an amount sufficient to make payment at settlement will be segregated a t the Fund custodian in order to pay for the commitment. At the time the Fund makes the commitment to purchase a security on a when-issued basis, it will record the transaction and reflect the liability for the purchase and value of the security in determining its net asset value. The Fund, generally, has the ability to close out a purchase obligation on or before the settlement date rather than take delivery of the security. Under no circumstances will settlement for such securities take place more than 120 days after the purchase date.
(j) TBA Sale Commitments–Developing Local Markets Fund may enter into TBA sale commitments to hedge its positions or to sell mortgage-backed securities it owns under delayed delivery arrangements. Proceeds of TBA sale commitments are not received until the contractual settlement date. During the time a TBA sale commitment is outstanding, equivalent deliverable securities, or an offsetting TBA purchase commitment deliverable on or before the sale commitment date, are held as "cover" for the transaction. Unsettled TBA sale commitments are valued at the current market value of the underlying securities,
54
Notes to Financial Statements (continued)
according to the procedures described under "Investment Valuation" above. The contract is adjusted to market value daily and the change in market value is recorded by the Fund as unrealized appreciation (depreciation). If the TBA sale (purchase) commitment is closed through the acquisition of an offsetting purchase (sale) commitment, the Fund realizes a gain or loss from the sale of the securities based upon the unit price established at the date the commitment was entered into.
(k) Mortgage Dollar Rolls–Developing Local Markets Fund may sell mortgage-backed securities for delivery in the current month and simultaneously contract to repurchase substantially similar (same type, coupon and maturity) securities on a specific future date. Such transactions are treated as financing transactions for financial reporting purposes. During the roll period, the Fund loses the right to receive principal (including prepayments of principal) and interest paid on the securities sold.
(l) Repurchase Agreements–Each Fund may enter into repurchase agreements with respect to securities. A repurchase agreement is a transaction in which a Fund acquires a security and simultaneously commits to resell that security to the seller (a bank or securities dealer) at an agreed-upon price on an agreed-upon date. Each Fund requires at all times that the repurchase agreement be collateralized by cash, or by securities of the U.S. Government, its agencies, its instrumentalities, or U.S. Government sponsored enterprises having a value equal to, or in excess of, the value of the repurchase agreement (including accrued interest). If the seller of the agreement defaults on its obligation to repurchase the underlying securities at a time when the value of these securities has dec lined, the Funds may incur a loss upon disposition of the securities.
(m) Reverse Repurchase Agreements–Each Fund may enter into reverse repurchase agreements. In a reverse repurchase agreement, a Fund sells a security to a securities dealer or bank for cash and agrees to repurchase the same security at an agreed-upon later date at an agreed-upon price. The interest payments associated with such transactions are included in interest expense in the Statement of Operations. Reverse repurchase agreements expose a Fund to credit risk, but this risk is reduced because each Fund maintains collateral equal to at least 100% of the market value of the securities sold. As of June 30, 2008, Developing Local Markets Fund did not have any open reverse repurchase agreements.
(n) Short Sales–Developing Local Markets Fund may sell a security it does not own in anticipation of a decline in the fair value of that security. When a Fund sells a security short, it must borrow the security sold short and deliver it to the broker-dealer through which it made the short sale. A gain, limited to the price at which the Fund sold the security short, or a loss, unlimited in size, will be realized upon the termination of a short sale. As of June 30, 2008, the Fund did not have any open short sales.
(o) Fair Value Measurements–Each Fund adopted FASB Statement No. 157, Fair Value Measurements ("SFAS 157"), effective January 1, 2008. In accordance with SFAS 157, fair value is defined as the price that each Fund would receive upon selling an investment in a timely transaction to an independent buyer in the principal or most advantageous market of the investment. SFAS 157 established a three-tier hierarchy to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including assumptions about risk – for example, the risk inherent in a particular valuat ion technique
55
Notes to Financial Statements (continued)
used to measure fair value including such a pricing model and/or the risk inherent in the inputs to the valuation technique. Inputs may be observable or unobservable. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability. Observable inputs are based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the reporting entity's own assumptions about the assumptions market participants would use in pricing the asset or liability. Unobservable inputs are based on the best information available in the circumstances. The three-tier hierarchy of inputs is summarized in the three broad Levels listed below:
• Level 1 – quoted prices in active markets for identical investments;
• Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.); and
• Level 3 – significant unobservable inputs (including the Fund's own assumptions in determining the fair value of investments).
The inputs or methodology used for valuing securities are not necessarily an indication of the risks associated with investing in those securities.
The following is a summary of the inputs used as of June 30, 2008 in valuing each Fund's investments carried at value:
Global Allocation Fund | Developing Local Markets Fund | ||||||||||||||||||
Valuation Inputs | Investments in Securities | Other Financial Instruments | Investments in Securities | Other Financial Instruments* | |||||||||||||||
Level 1 – Quoted Prices | $ | 104,686,178 | $ | - | $ | - | $ | 1,702,201 | |||||||||||
Level 2 – Other Significant Observable Inputs | 3,925,547 | - | 105,456,587 | - | |||||||||||||||
Total | $ | 108,611,725 | $ | - | $ | 105,456,587 | $ | 1,702,201 |
* Other Financial Instruments include futures and forward currency contracts.
3. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Management Fees
The Company has a management agreement with Lord Abbett pursuant to which Lord Abbett supplies each Fund with investment management services and executive and other personnel, pays the remuneration of officers, provides office space and pays for ordinary and necessary office and clerical expenses relating to research and statistical work and supervision of each Fund's investment portfolio.
The management fees are based on average daily net assets at the following annual rates:
Global Allocation Fund: | |||||||
First $1 billion | .75 | % | |||||
Next $1 billion | .70 | % | |||||
Over $2 billion | .65 | % | |||||
Developing Local Markets Fund: | |||||||
First $1 billion | .50 | % | |||||
Over $1 billion | .45 | % |
56
Notes to Financial Statements (continued)
For the year ended June 30, 2008, the fee paid to Lord Abbett was at the following annualized rates:
Management Fees | |||||||
Global Allocation Fund | .75 | % | |||||
Developing Local Markets Fund | .50 | % |
Effective July 1, 2008, the management fee for Global Allocation Fund is calculated on average daily net assets at the annual rate of .25%. Lord Abbett has contractually agreed to waive its fee for the period July 1, 2008 though April 30, 2009.
For the period January 1, 2008 through June 30, 2008, Lord Abbett contractually agreed to reimburse the Global Allocation Fund to the extent necessary so that each class' total annual operating expenses do not exceed the following annual rates:
Class | % of Average Daily Net Assets | ||||||
A | 1.60 | % | |||||
B | 2.25 | % | |||||
C | 2.25 | % | |||||
F | 1.35 | % | |||||
I | 1.25 | % | |||||
P | 1.70 | % | |||||
R2 | 1.85 | % | |||||
R3 | 1.75 | % |
Effective July 1, 2008 through April 30, 2009, Lord Abbett has contractually agreed to reimburse the Global Allocation Fund to the extent necessary so that each class' total annual operating expenses do not exceed the following annual rates:
Class | % of Average Daily Net Assets | ||||||
A | 1.35 | % | |||||
B | 2.00 | % | |||||
C | 2.00 | % | |||||
F | 1.10 | % | |||||
I | 1.00 | % | |||||
P | 1.45 | % | |||||
R2 | 1.60 | % | |||||
R3 | 1.50 | % |
For the period January 1, 2008 through April 30, 2009, Lord Abbett has contractually agreed to reimburse the Developing Local Markets Fund to the extent necessary so that each class' total annual operating expenses do not exceed the following annual rates:
Class | % of Average Daily Net Assets | ||||||
A | 1.30 | % | |||||
B | 1.95 | % | |||||
C | 1.95 | % | |||||
F | 1.05 | % | |||||
I | .95 | % | |||||
P | 1.40 | % | |||||
R2 | 1.55 | % | |||||
R3 | 1.45 | % |
57
Notes to Financial Statements (continued)
Lord Abbett provides certain administrative services to the Funds pursuant to an Administrative Services Agreement at an annual rate of .04% of the Fund's average daily net assets. Effective July 1, 2008, this fee will not be charged to the Global Allocation Fund.
12b-1 Distribution Plan
Each Fund has adopted a distribution plan with respect to Class A, B, C, F, P, R2 and R3 shares pursuant to Rule 12b-1 under the Act, which provides for the payment of ongoing distribution and service fees to Lord Abbett Distributor LLC ("Distributor"), an affiliate of Lord Abbett. The fees are accrued daily at annual rates based upon average daily net assets as follows:
Fees* | Class A | Class B | Class C | Class F | Class P(1) | Class R2 | Class R3 | ||||||||||||||||||||||||
Service | .25 | % | .25 | % | .25 | % | - | .20 | % | .25 | % | .25 | % | ||||||||||||||||||
Distribution | .10 | % | .75 | % | .75 | % | .10 | % | .25 | % | .35 | % | .25 | % |
* The Fund may designate a portion of the aggregate fee as attributable to service activities for purposes of calculating Financial Industry Regulatory Authority Inc. ("FINRA") sales charge limitations.
(1) Developing Local Markets Fund only.
Class I does not have a distribution plan.
Commissions
Distributor received the following commissions on sales of shares of the Funds, after concessions were paid to authorized dealers, for the six months ended June 30, 2008:
Distributor Commissions | Dealers' Concessions | ||||||||||
Global Allocation Fund | $ | 20,256 | $ | 107,086 | |||||||
Developing Local Markets Fund | 28,821 | 149,252 |
Distributor received the following amount of CDSCs for the year ended June 30, 2008:
Class A | Class C | ||||||||||
Global Allocation Fund | $ | 271 | $ | 161 | |||||||
Developing Local Markets Fund | 19 | 1,799 |
Two Directors and certain of the Fund's officers have an interest in Lord Abbett.
4. DISTRIBUTIONS AND CAPITAL LOSS CARRYFORWARDS
Dividends from net investment income, if any, are declared daily and paid monthly for Developing Local Markets Fund. Prior to June 30, 2008, dividends from net investment income, if any, were declared and paid semiannually for Global Allocation Fund. Effective July 1, 2008, dividends from net investment income, if any, are declared and paid quarterly for Global Allocation Fund. Taxable net realized gains from investment transactions, reduced by capital loss carryforwards, if any, are declared and distributed to shareholders at least annually. The capital loss carryforward amount, if any, is available to offset future net capital gains. Dividends and distributions to shareholders are recorded on the ex-dividend date. The amount of dividends and distributions from net investment income and net realized capital gains are determined in accordance with Federal income tax regulations which may differ from accounting principles generally accepted i n the United States of America. These book/tax differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature, such amounts are reclassified within the components of net assets based on their federal
58
Notes to Financial Statements (continued)
tax basis treatment; temporary differences do not require reclassification. Dividends and distributions, which exceed earnings and profits for tax purposes, are reported as a tax return of capital.
The tax character of distributions paid during the six months ended June 30, 2008 and fiscal year ended December 31, 2007 was as follows:
Global Allocation Fund | Developing Local Markets Fund | ||||||||||||||||||
Six Months Ended 6/30/2008 (unaudited) | Year Ended 12/31/2007 | Six Months Ended 6/30/2008 (unaudited) | Year Ended 12/31/2007 | ||||||||||||||||
Distributions paid from: | |||||||||||||||||||
Ordinary income | $ | 660,488 | $ | 7,402,846 | $ | 1,134,685 | $ | 5,123,670 | |||||||||||
Net long-term capital gains | 1,128,310 | 6,062,779 | - | - | |||||||||||||||
Total distributions paid | $ | 1,788,798 | $ | 13,465,625 | $ | 1,134,685 | $ | 5,123,670 |
As of June 30, 2008, the aggregate unrealized security gains and losses based on cost for U.S. Federal income tax purposes were as follows:
Global Allocation Fund | Developing Local Markets Fund | ||||||||||
Tax cost | $ | 110,322,870 | $ | 104,923,399 | |||||||
Gross unrealized gain | 9,668,077 | 793,407 | |||||||||
Gross unrealized loss | (11,379,222 | ) | (260,219 | ) | |||||||
Net unrealized security gain (loss) | $ | (1,711,145 | ) | $ | 533,188 |
The difference between book-basis and tax-basis unrealized gains (losses) is attributable to wash sales and amortization.
5. PORTFOLIO SECURITIES TRANSACTIONS
Purchases and sales of investment securities (excluding short-term investments) for the fiscal year ended June 30, 2008 are as follows:
U.S. Government Purchases* | Non-U.S. Government Purchases | U.S. Government Sales* | Non-U.S. Government Sales | ||||||||||||||||
Global Allocation Fund | $ | - | $ | 38,337,982 | $ | - | $ | 39,091,429 | |||||||||||
Developing Local Markets Fund | 1,417,176 | 68,676,013 | 1,805,072 | 24,123,490 |
* Includes U.S. Government sponsored enterprises securities.
6. DIRECTORS' REMUNERATION
The Company's officers and the two Directors who are associated with Lord Abbett do not receive any compensation from the Company for serving in such capacities. Outside Directors' fees are allocated among all Lord Abbett-sponsored funds based on the net assets of each fund. There is an equity-based plan available to all outside Directors under which outside Directors must defer receipt of a portion of, and may elect to defer receipt of an additional portion of, Directors' fees. The deferred amounts are treated as though equivalent dollar amounts have been invested
59
Notes to Financial Statements (continued)
proportionately in the funds. Such amounts and earnings accrued thereon are included in Directors' fees on the Statement of Operations and in Directors' fees payable on the Statement of Assets and Liabilities and are not deductible for U.S. Federal income tax purposes until such amounts are paid.
7. EXPENSE REDUCTIONS
The Company has entered into arrangements with the Funds' transfer agent and custodian, whereby credits realized as a result of uninvested cash balances are used to reduce a portion of each Fund's expenses.
8. LINE OF CREDIT
Global Allocation Fund, along with certain other funds managed by Lord Abbett, has available a $250,000,000 unsecured revolving credit facility ("Facility") from a consortium of banks, to be used for temporary or emergency purposes as an additional source of liquidity to fund redemptions of investor shares. Any borrowings under this Facility will bear interest at current market rates as defined in the agreement. The fee for this Facility is at an annual rate of .08%. As of June 30, 2008, there were no loans outstanding pursuant to this Facility nor was the Facility utilized at any time during the year ended June 30, 2008.
9. CUSTODIAN AND ACCOUNTING AGENT
State Street Bank & Trust Company ("SSB") is the Company's custodian and accounting agent. SSB performs custodial, accounting and recordkeeping functions relating to portfolio transactions and calculating each Fund's NAV.
10. INVESTMENT RISKS
Each Fund is subject to the risks of investing in securities that are issued by non-U.S. entities, the risks of investing in derivatives, liquidity risk, and the risks from leverage.
Foreign securities may pose greater risks than domestic securities, including greater price fluctuations, less government regulation, and higher transaction costs. Foreign investments also may be affected by changes in currency rates or currency controls.
Derivatives are subject to risks such as liquidity risk, leveraging risk, interest rate risk, market risk, and credit risk. Derivatives also 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 value of the underlying asset, rate, or index.
Illiquid securities may lower a Fund's returns since the Fund may be unable to sell these securities at its desired time or price.
Leverage, including borrowing, may increase volatility in a Fund by magnifying the effect of changes in the value of the Fund's holdings. The use of leverage may cause investors in a Fund to lose more money in adverse environments than would be the case in the absence of leverage.
Prior to adopting its current investment strategy on July 1, 2008, the Global Allocation Fund was subject to the following general risks and considerations associated with equity investing. The
60
Notes to Financial Statements (continued)
value of an investment will fluctuate in response to movements in the stock market in general and to the changing prospects of individual companies in which the Global Allocation Fund invests. Although certain companies in which the Global Allocation Fund may invest may exhibit earnings and revenue growth above the market trend, the stocks of these companies may be more volatile and may drop in value if earnings and revenue growth do not meet expectations. With respect to foreign currency transactions in which the Fund may engage, there is no guarantee that these transactions will be successful. They may lower the Fund's return or result in significant losses.
Effective July 1, 2008, Global Allocation Fund is subject to investment risks associated with its new investment strategies, which are described in the current prospectus.
The Developing Local Markets Fund is subject to the general risks and considerations associated with investing in debt securities, including interest rate risk. When interest rates rise, the prices of debt securities and an investment in the Developing Local Markets Fund are likely to decline. In times of economic uncertainty, high-yield debt securities (or "junk bonds") may decline in price, even when interest rates are falling. There is also the risk that an issuer of a debt security will fail to make timely payments of principal or interest to the Developing Local Markets Fund, a risk that is greater with junk bonds.
Foreign currency exchange rates may fluctuate significantly over short periods of time. The Developing Local Markets Fund's use of currency-related transactions involves the risk that Lord Abbett will not accurately predict currency movements, and the Fund's returns could be reduced as a result. A decline in the value of foreign currencies relative to the U.S. dollar will reduce the value of securities held by the Developing Local Markets Fund that are denominated in those currencies.
The securities markets of developing or emerging countries tend to be less liquid, are especially subject to greater price volatility, have a smaller market capitalization, have less government regulation and may not be subject to as extensive and frequent accounting, financial, and other reporting requirements as securities issued in more developed countries.
The Developing Local Markets Fund believes that its investment strategies with respect to foreign currencies will generate qualifying income under current U.S. federal income tax law. However, there can be no assurance that the U.S. Treasury Department will not issue regulations in the future (possibly with retroactive effect) that would treat some or all of the Fund's foreign currency gains as nonqualifying income.
These factors can affect each Fund's performance.
61
Notes to Financial Statements (continued)
11. SUMMARY OF CAPITAL TRANSACTIONS
Transactions in shares of capital stock are as follows:
GLOBAL ALLOCATION FUND
Six Months Ended June 30, 2008 (unaudited) | Year Ended December 31, 2007 | ||||||||||||||||||
Class A Shares | Shares | Amount | Shares | Amount | |||||||||||||||
Shares sold | 643,278 | $ | 7,890,480 | 1,215,912 | $ | 17,010,004 | |||||||||||||
Converted from Class B* | 16,956 | 206,395 | 41,894 | 583,098 | |||||||||||||||
Reinvestment of distributions | 112,018 | 1,284,031 | 737,648 | 9,775,524 | |||||||||||||||
Shares reacquired | (763,744 | ) | (9,300,879 | ) | (1,131,751 | ) | (15,846,193 | ) | |||||||||||
Increase | 8,508 | $ | 80,027 | 863,703 | $ | 11,522,433 | |||||||||||||
Class B Shares | |||||||||||||||||||
Shares sold | 130,069 | $ | 1,483,947 | 235,633 | $ | 3,090,432 | |||||||||||||
Reinvestment of distributions | 17,115 | 181,943 | 109,940 | 1,359,027 | |||||||||||||||
Shares reacquired | (127,603 | ) | (1,447,180 | ) | (194,549 | ) | (2,548,549 | ) | |||||||||||
Converted to Class A* | (18,233 | ) | (206,395 | ) | (44,611 | ) | (583,098 | ) | |||||||||||
Increase | 1,348 | $ | 12,315 | 106,413 | $ | 1,317,812 | |||||||||||||
Class C Shares | |||||||||||||||||||
Shares sold | 188,997 | $ | 2,152,226 | 454,896 | $ | 5,944,096 | |||||||||||||
Reinvestment of distributions | 21,980 | 234,081 | 134,683 | 1,668,249 | |||||||||||||||
Shares reacquired | (143,490 | ) | (1,618,775 | ) | (297,396 | ) | (3,924,128 | ) | |||||||||||
Increase | 67,487 | $ | 767,532 | 292,183 | $ | 3,688,217 | |||||||||||||
Class F Shares | Period Ended December 31, 2007† | ||||||||||||||||||
Shares sold | 382 | $ | 4,517 | 681.81 | $ | 10,029 | |||||||||||||
Reinvestment of distributions | 19 | 213 | 69.66 | 913 | |||||||||||||||
Increase | 401 | $ | 4,730 | 751.47 | $ | 10,942 | |||||||||||||
Class I Shares | Year Ended December 31, 2007 | ||||||||||||||||||
Shares sold | 4,592 | $ | 57,309 | 15,746 | $ | 224,198 | |||||||||||||
Reinvestment of distributions | 963 | 11,071 | 6,473 | 85,764 | |||||||||||||||
Shares reacquired | (6,760 | ) | (82,573 | ) | (5,368 | ) | (77,223 | ) | |||||||||||
Increase (decrease) | (1,205 | ) | $ | (14,193 | ) | 16,851 | $ | 232,739 | |||||||||||
Class R2 Shares | Period Ended June 30, 2008†† | ||||||||||||||||||
Shares sold | 847 | $ | 10,015 | ||||||||||||||||
Reinvestment of distributions | 14 | 159 | |||||||||||||||||
Increase | 861 | $ | 10,174 | ||||||||||||||||
Class R3 Shares | |||||||||||||||||||
Shares sold | 847 | $ | 10,015 | ||||||||||||||||
Reinvestment of distributions | 14 | 159 | |||||||||||||||||
Increase | 861 | $ | 10,174 |
* Automatic conversion of Class B shares occurs approximately eight years after the initial purchase date.
† For the period September 28, 2007 (commencement of investment operations) to December 31, 2007.
†† For the period June 23, 2008 (commencement of investment operations) to June 30, 2008.
62
Notes to Financial Statements (continued)
DEVELOPING LOCAL MARKETS FUND
Six Months Ended June 30, 2008 (unaudited) | Year Ended December 31, 2007 | ||||||||||||||||||
Class A Shares | Shares | Amount | Shares | Amount | |||||||||||||||
Shares sold | 5,189,166 | $ | 36,170,435 | 1,022,043 | $ | 6,984,852 | |||||||||||||
Converted from Class B* | 16,228 | 111,494 | 48,852 | 331,700 | |||||||||||||||
Reinvestment of distributions | 105,462 | 727,653 | 536,642 | 3,617,915 | |||||||||||||||
Shares reacquired | (870,287 | ) | (6,024,034 | ) | (2,411,351 | ) | (16,429,458 | ) | |||||||||||
Increase (decrease) | 4,440,569 | $ | 30,985,548 | (803,814 | ) | $ | (5,494,991 | ) | |||||||||||
Class B Shares | |||||||||||||||||||
Shares sold | 229,890 | $ | 1,597,920 | 97,913 | $ | 672,860 | |||||||||||||
Reinvestment of distributions | 5,821 | 40,200 | 34,457 | 232,444 | |||||||||||||||
Shares reacquired | (54,245 | ) | (373,795 | ) | (204,168 | ) | (1,398,703 | ) | |||||||||||
Converted to Class A* | (16,204 | ) | (111,494 | ) | (48,780 | ) | (331,700 | ) | |||||||||||
Increase (decrease) | 165,262 | $ | 1,152,831 | (120,578 | ) | $ | (825,099 | ) | |||||||||||
Class C Shares | |||||||||||||||||||
Shares sold | 1,228,606 | $ | 8,618,629 | 238,003 | $ | 1,631,457 | |||||||||||||
Reinvestment of distributions | 11,023 | 76,306 | 59,659 | 402,838 | |||||||||||||||
Shares reacquired | (130,215 | ) | (901,827 | ) | (378,495 | ) | (2,583,706 | ) | |||||||||||
Increase (decrease) | 1,109,414 | $ | 7,793,108 | (80,833 | ) | $ | (549,411 | ) | |||||||||||
Class F Shares | Period Ended December 31, 2007† | ||||||||||||||||||
Shares sold | 85,027 | $ | 600,853 | 1,447 | $ | 10,014 | |||||||||||||
Reinvestment of distributions | 48 | 332 | 89 | 599 | |||||||||||||||
Shares reacquired | - | - | - | - | |||||||||||||||
Increase | 85,075 | $ | 601,185 | 1,536 | $ | 10,613 | |||||||||||||
Class I Shares | Year Ended December 31, 2007 | ||||||||||||||||||
Shares sold | 1,389,078 | $ | 9,748,789 | 32,388 | $ | 224,542 | |||||||||||||
Reinvestment of distributions | 6,477 | 45,368 | 13,079 | 88,309 | |||||||||||||||
Shares reacquired | (90,366 | ) | (620,282 | ) | (65,395 | ) | (455,424 | ) | |||||||||||
Increase | 1,305,189 | $ | 9,173,875 | (19,928 | ) | $ | (142,573 | ) | |||||||||||
Class P Shares | |||||||||||||||||||
Shares sold | 118 | $ | 981 | 1,147 | $ | 7,827 | |||||||||||||
Reinvestment of distributions | - | - | 1 | 6 | |||||||||||||||
Shares reacquired | (12 | ) | (84 | ) | (85 | ) | (590 | ) | |||||||||||
Increase (decrease) | 106 | $ | 897 | 1,063 | $ | 7,243 | |||||||||||||
Class R2 Shares | Period Ended December 31, 2007† | ||||||||||||||||||
Shares sold | - | $ | - | 1,445 | $ | 10,000 | |||||||||||||
Reinvestment of distributions | 24 | 167 | 88 | 591 | |||||||||||||||
Increase | 24 | $ | 167 | 1,533 | $ | 10,591 | |||||||||||||
Class R3 Shares | |||||||||||||||||||
Shares sold | - | $ | - | 1,445 | $ | 10,000 | |||||||||||||
Reinvestment of distributions | 24 | 172 | 89 | 592 | |||||||||||||||
Increase | 24 | $ | 172 | 1,534 | $ | 10,592 |
* Automatic conversion of Class B shares occurs approximately eight years after the initial purchase date.
† For the period September 28, 2007 (commencement of investment operations) to December 31, 2007.
63
Notes to Financial Statements (concluded)
12. RECENT ACCOUNTING PRONOUNCEMENTS
In March 2008, FASB issued FASB Statement No. 161, Disclosures about Derivative Instruments and Hedging Activities ("SFAS 161"). SFAS 161 is intended to improve financial reporting about derivative instruments and hedging activities by requiring enhanced disclosures to enable investors to better understand their effects on an entity's financial position, financial performance and cash flows, SFAS 161 is effective for fiscal years and interim periods beginning after November 15, 2008. Management is currently evaluating the impact the adoption of SFAS 161 will have on the Fund's financial statement disclosures.
64
Supplemental Proxy Information (unaudited)
A special meeting of the shareholders (the "Meeting") of Lord Abbett Global Allocation Fund (formerly, Lord Abbett Global Equity Fund) ("Global Allocation Fund" or the "Fund") was held on May 15, 2008.
The meeting for the Global Allocation Fund was held for the purpose of approving the proposal to: (1) convert the Fund to a fund-of-funds structure, meaning that it would invest in certain mutual funds in the Lord Abbett Family of Funds; (2) change the Fund's investment objective from "long-term growth of capital and income consistent with reasonable risk" to "total return"; (3) amend two of the Fund's fundamental investment restrictions; and (4) amend the investment management agreement between the Fund and Lord Abbett, which will reduce the contractual investment management fee payable to Lord Abbett.
The results of the proxy solicitation on the preceding matter were as follows:
Matter | Votes For | Votes Against | Abstentions | ||||||||||||
1. Proposal – To convert the Fund to a fund-of-funds structure. | 4,333,812.366 | 259,452.097 | 364,165.508 | ||||||||||||
2. Proposal – To change the Fund's investment objective. | 4,293,441.764 | 306,078.797 | 357,909.410 | ||||||||||||
3(a). Proposal – To amend the Fund's fundamental investment restriction regarding concentration. | 4,346,719.009 | 245,057.336 | 365,653.626 | ||||||||||||
3(b). Proposal – To amend the Fund's fundamental investment restriction regarding diversification. | 4,378,622.288 | 223,392.850 | 355,414.833 | ||||||||||||
4. Proposal – To amend the investment management agreement between the Fund and Lord Abbett, which will reduce the contractual investment management fee payable to Lord Abbett. | 4,350,603.420 | 246,129.409 | 360,697.142 |
65
Householding
The Company has adopted a policy that allows it to send only one copy of each Fund's Prospectuses, proxy material, annual report and semiannual report to certain shareholders residing at the same "household." This reduces Fund expenses, which benefits you and other shareholders. If you need additional copies or do not want your mailings to be "householded," please call Lord Abbett at 888-522-2388 or send a written request with your name, the name of your fund or funds and your account number or numbers to Lord Abbett Family of Funds, P.O. Box 219336, Kansas City, MO 64121.
Proxy Voting Policies, Procedures and Records
A description of the policies and procedures that Lord Abbett uses to vote proxies related to each Funds' portfolio securities, and information on how Lord Abbett voted each Fund's proxies during the 12-month period ended June 30 are available without charge, upon request, (i) by calling 888-522-2388; (ii) on Lord Abbett's website at www.lordabbett.com; and (iii) on the Securities and Exchange Commission's ("SEC") website at www.sec.gov.
Shareholder Reports and Quarterly Portfolio Disclosure
The Funds are required to file their complete schedule of portfolio holdings with the SEC for its first and third fiscal quarters on Form N-Q. Copies of the filings are available without charge, upon request on the SEC's website at www.sec.gov and may be available by calling Lord Abbett at 888-522-2388. You can also obtain copies of Form N-Q by (i) visiting the SEC's Public Reference Room in Washington, DC (information on the operation of the Public Reference Room may be obtained by calling 800-SEC-0330); (ii) sending your request and duplicating fee to the SEC's Public Reference Section, Washington, DC 20549-0102; or (iii) sending your request electronically, after paying a duplicating fee, to publicinfo@sec.gov.
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This report, when not used for the general information
of shareholders of the Fund, is to be distributed only if
preceded or accompanied by a current fund prospectus.
Lord Abbett Mutual Fund shares are distributed by
LORD ABBETT DISTRIBUTOR LLC.
Lord Abbett Global Fund, Inc.
Lord Abbett Global Allocation Fund
Lord Abbett Developing Local Markets Fund
LAGF-3-0608
(8/08)
Item 2: |
| Code of Ethics. | |||
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Item 3: |
| Audit Committee Financial Expert. | |||
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Item 4: | Principal Accountant Fees and Services. | ||||
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Item 5: | Audit Committee of Listed Registrants. | ||||
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Item 6: | Investments. | ||||
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Item 7: | Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. | ||||
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Item 8: | Portfolio Managers of Closed-End Management Investment Companies. | ||||
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Item 9: | Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. | ||||
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Item 10: |
| Submission of Matters to a Vote of Security Holders. | |||
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Item 11: |
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(a) |
| Based on their evaluation of the Registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) as of a date within 90 days prior to the filing date of this report, the Chief Executive Officer and Chief Financial Officer of the Registrant have concluded that such disclosure controls and procedures are reasonably designed and effective to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to them by others within those entities. | |||
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(b) |
| There were no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) 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. | |||
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Item 12: | Exhibits. | ||||
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| (a)(2) | Certification of each principal executive officer and principal financial officer of the Registrant as required by Rule 30a-2 under the Investment Company Act of 1940 is attached hereto as a part of EX-99.CERT. | |||
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| (a)(3) | Not applicable. | |||
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| (b) | Certification of each principal executive officer and principal financial officer of the Registrant as required by Section 906 of the Sarbanes-Oxley Act of 2002 is provided as a part of EX-99.906CERT. | |||
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.
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| LORD ABBETT GLOBAL FUND, INC. |
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| By: | /s/ Robert S. Dow |
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| Robert S. Dow |
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| Chief Executive Officer and Chairman |
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Date: August 21, 2008 |
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| By: | /s/ Joan A. Binstock |
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| Joan A. Binstock |
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| Chief Financial Officer and Vice President |
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Date: August 21, 2008 |
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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.
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| By: | /s/ Robert S. Dow |
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| Robert S. Dow |
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| Chief Executive Officer and Chairman |
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Date: August 21, 2008 |
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| By: | /s/ Joan A. Binstock |
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| Joan A. Binstock |
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| Chief Financial Officer and Vice President |
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Date: August 21, 2008 |
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