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Investment Company Act file number | 811-05646 |
New Century Portfolios |
(Exact name of registrant as specified in charter) |
100 William Street, Suite 200 Wellesley, Massachusetts | 02481 |
(Address of principal executive offices) | (Zip code) |
Weston Financial Group, Inc. 100 William Street, Suite 200 Wellesley, MA 02481 |
(Name and address of agent for service) |
Registrant's telephone number, including area code: | (781) 235-7055 |
Date of fiscal year end: | October 31, 2015 | |
Date of reporting period: | October 31, 2015 |
Item 1. | Reports to Stockholders. |
![]() New Century Capital
New Century Balanced
New Century International
New Century Alternative Strategies
ANNUAL REPORT
Year Ended October 31, 2015
100 William Street, Suite 200, Wellesley MA 02481 781-239-0445 888-639-0102 Fax 781-237-1635
|
contents
LETTER TO SHAREHOLDERS | 2-5 |
PERFORMANCE CHARTS | 6-9 |
NEW CENTURY PORTFOLIOS | |
New Century Capital Portfolio | |
Portfolio Information | 10 |
Schedule of Investments | 11-12 |
New Century Balanced Portfolio | |
Portfolio Information | 13 |
Schedule of Investments | 14-15 |
New Century International Portfolio | |
Portfolio Information | 16 |
Schedule of Investments | 17-18 |
New Century Alternative Strategies Portfolio | |
Portfolio Information | 19 |
Schedule of Investments | 20-21 |
Statements of Assets and Liabilities | 22 |
Statements of Operations | 23 |
Statements of Changes in Net Assets | 24-27 |
Financial Highlights | 28-31 |
Notes to Financial Statements | 32-41 |
Report of Independent Registered Public Accounting Firm | 42 |
Board of Trustees and Officers | 43-45 |
About Your Portfolios’ Expenses | 46-47 |
Trustees’ Approval of Investment Advisory Agreements | 48-54 |
LETTER TO SHAREHOLDERS | December, 2015 |
Dear Fellow Shareholders:
We are pleased to present our 26th Annual Report. This report summarizes the 12-month period ended October 31, 2015. This report presents important financial information for each of the New Century Portfolios (together, the “Portfolios” and each, a “Portfolio”). We invite you to visit our website at www.newcenturyportfolios.com for additional information.
● ● ●
When I was young I had a fear of the dentist. Sure he had an office with video games, a toy box and bubble gum flavored teeth cleaner to keep kids like me happy; still I would panic every time I was scheduled for a cleaning. Looking back on it I was scared of the unknown even though each cleaning wasn’t the ordeal I made it out to be and most likely helped to avoid more painful future dental work. The markets and the Federal Reserve have had a similar relationship in 2015. Each time the Federal Reserve was ready to move from a zero-rate policy to an extremely accommodative policy the global markets threw a fit. The Federal Reserve would reassure the markets by constantly bringing up the slower normalization path, and numerous reasons why small raises to the Federal Funds rate now could decrease the need for a hastened tightening in the future. Each time, though volatility increased, equities sold off, and the Federal Reserve was forced to keep rate hikes on hold. To nobody’s surprise the global markets also fear the unknown.
Many will point to other factors beside the Federal Reserve for increased volatility and the equity market correction of late Q3 2015 including: China and the Yuan devaluation; the historically long period between U.S. equity market correctionsi; and the bear market in energy and commodities. We believe that while all these factors contributed to volatility, the uncertainty around the Federal Reserve and its ongoing policy is driving the volatility. It is the known unknown that every Federal Reserve meeting is “live,” but will continue to have the ambiguous “data dependent” mandate that we expect will continue to drive volatility during 2016. We view “liftoff” as a positive and believe the Federal Reserve can properly navigate raising short term rates without derailing the economic recovery.
Our observations for the rest of calendar 2015 and the start of 2016 remain cautious and centered on a slower growth environment with the opportunity for international equities to outpace domestic equities. We remain bullish on international equities fueled by Quantitative Easing (QE) and favorable exchange rates. We feel developed international equities in the large and mid-cap spectrum, both international and domestically, should perform well. We expect large U.S. companies will face more scrutiny from investors who are growing tired of hearing about the stronger dollar hurting company earnings and are increasingly looking for top line growth. We favor consumer based technology, and health care sectors for their strong earnings growth and demographic tailwinds. We also continue to favor domestic investments in mid and small capitalization sectors versus solely mega-cap companies as mid- and small-cap investments have less exposure to foreign sales and currency pressure. Fixed-income will be the most interesting asset class, as the Federal Reserve can only control the short end of the curve, creating opportunities for us to take advantage of the belly of the curve. As for energy, it’s anyone’s guess where the commodity goes from here in the near-
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term. Without a macro event (war, natural disaster), we believe the oversupply story stays intact for 2016; however, we believe the spot price of energyii can recover back into the $50s. If we have one fear, it’s in housing, a lagging indicator sector which, if wage inflation does not increase, could put pressure on current rent prices and home values. For this reason we prefer investments focused on home goods rather than home builders.
Overall, we continue to take a long-term view of the Portfolios in the lower return environment we are currently experiencing. We will be looking for opportunities to increase exposure to developed international markets. We do not believe that chasing headline yield in any asset class is prudent as there are positive returns to be made with proper allocations over time. And don’t fear the dentist, a regular cleaning can ensure a less painful future.
New Century Capital Portfolio (NCCPX) returned 1.20% versus 5.20% for the S&P 500® Composite Index and 2.58% for the Morningstar Large Blend Category for the twelve-months ended October 31, 2015. The major drag on the Portfolio was an overweight to health care. During the equity market correction in August and September 2015, health care was hit especially hard, fueled by news articles about drug pricing, a Hillary Clinton tweet, and a negative report on Valeant. With health care’s above average earnings growth and the prospect of new innovative drugs in the pipeline, we remain bullish on the health care sector’s long-term potential. Based on our feeling regarding the long-term value of this sector, and in an effort to mitigate capital gains distributions from the Portfolio, we made a tactical decision only to trim health care holdings, even if doing so led to short-term underperformance. Investments in mid-cap, consumer, and information technology were all positive contributors to performance. However, small-caps remained under pressure, and therefore we reduced these positions in the Portfolio. We are bullish about international investments with around 10% of the Portfolio invested internationally on a look through basis.
New Century Balanced Portfolio (NCIPX) returned (2.04%) versus 0.07% for the Morningstar Moderate Target Risk Index, 0.45% for the Moderate Allocation Category, 5.20% for the S&P 500® Composite Index, and 1.86% for the Barclays U.S. Intermediate Government/Credit Index for the twelve-months ended October 31, 2015. We were disappointed by the performance of several of our core holdings, most notably in the fixed-income area where non-dollar denominated debt was a major downside contributor. In the face of this underperformance, we reduced allocations to several investments while moving those funds to lower risk fixed-income investments. On the equity side, overweights to health care and energy hurt performance as did an underweight to consumer discretionary. We believe the losses incurred by our MLP investments were overdone and the market did not properly evaluate the differentiated business and yield that MLPs have over traditional integrated energy companies. We identified an opportunity to capitalize on short-term opportunities in the closed-end fund area where discounts to net asset value represented great value opportunities. In addition, a new international fund, which we believe has a great track record and extremely good downside capture, was added to the Portfolio. The Portfolio remains overweight equities compared to our traditional 60/40 stocks/bonds allocation.
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New Century International Portfolio (NCFPX) returned 0.45%, outperforming the (0.07%) for the MSCI EAFE Index, (4.68%) for the MSCI ACWI ex-U.S. Index, and (1.56%) for the Morningstar Foreign Large Blend Category for the twelve-months ended October 31, 2015. We were largely satisfied with the performance of the Portfolio for the last six months as this year has been a very difficult one for foreign large-cap managers, and we are seeing positive divergence between our Portfolio and competitors as our downside capture was superior to the category. U.S. dollar weakness versus the Euro and Yen from mid-March through September 2015 posed a headwind to our dollar hedged positions; however, with the anticipated divergence between the Federal Reserve and other Central Banks, we anticipate continuing to currency hedge to an extent through at least Q1 calendar 2016. Allocations to small and mid-cap equities were a large positive driver as was dividend growth investments. We remain slightly underweight emerging markets compared to the MSCI ACWI-ex U.S. Index, with those investments concentrated in China and India. During the last six-months ended October 31, 2015 we had negligible to no direct exposure to Brazil and Russia, and we are beginning to believe both markets may be over sold.
New Century Alternative Strategies (NCHPX) returned (3.56%) versus 0.07% for the Morningstar Moderate Target Risk Index, (0.67%) for the Multialternative Category, 5.20% for the S&P 500® Composite Index, and 1.86% for the Barclays U.S. Intermediate Government/Credit Index for the twelve-months ended October 31, 2015. Investments in energy, MLPs, and commodities had a significant negative impact on Portfolio performance, despite a reduction to those allocations, however we believe that the Portfolio’s MLP investments have significant long-term appreciation potential given strong cash flows and current depressed valuations. The Portfolio’s positions in long/short equity, market neutral funds, and managed futures funds generated positive absolute returns, and we continue to increase these positions for their low correlation to equity markets. Domestic and multisector fixed-income funds were positive contributors to performance, while global fixed-income had a negative return due in part to the strengthening U.S. dollar. During the past twelve-months we have expanded the Portfolio’s merger arbitrage positions to include funds with participation in the mid- and small-cap market sectors. During Q3 of calendar 2015, the Portfolio has added to positions in fixed-income closed-end funds trading at historically wide discounts to their net asset value. We will continue to take a disciplined approach to create a broadly diversified, low volatility portfolio with multiple sources of return, and containing both inflation and market hedged investments.
We appreciate and thank you for your trust in New Century Portfolios.
Sincerely,
Nicole M. Tremblay, Esq. | Matthew I. Solomon | Ronald A. Sugameli |
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Investors should take into consideration the investment objectives, risks, charges and expenses of the New Century Portfolios carefully before investing. The prospectus contains these details and other information and should be read carefully before investing. Principal value of an investment will fluctuate and shares when redeemed may be worth more or less than your original investment. Past performance is not indicative of future results. Portfolio holdings and opinions expressed herein are subject to change.
i | Measured by the S&P 500® Composite Index |
ii | Measured by USD West Texas Intermediate (WTI) |
5
NEW CENTURY CAPITAL PORTFOLIO
PERFORMANCE CHARTS (Unaudited)
Comparison of the Change in Value of a $10,000 Investment
in New Century Capital Portfolio and S&P 500® Composite Index
Average Annual Total Returns For Periods Ended October 31, 2015 | |||
1 Year | 5 Years | 10 Years | |
New Century Capital Portfolio (a) | 1.20% | 9.98% | 5.73% |
S&P 500® Composite Index* | 5.20% | 14.33% | 7.85% |
(a) | The total returns do not reflect the deduction of taxes that a shareholder would pay on Portfolio distributions or the redemption of Portfolio shares. |
* | The S&P 500® Composite Index is comprised of 500 U.S. stocks and is an indicator of the performance of the overall U.S. stock market. An investor cannot invest in an index and its returns are not indicative of the performance of any specific investment. |
6
NEW CENTURY BALANCED PORTFOLIO
PERFORMANCE CHARTS (Unaudited)
Comparison of the Change in Value of a $10,000 Investment
in New Century Balanced Portfolio, S&P 500® Composite Index and
Barclays U.S. Intermediate Government/Credit Index
Average Annual Total Returns For Periods Ended October 31, 2015 | |||
1 Year | 5 Years | 10 Years | |
New Century Balanced Portfolio (a) | (2.04%) | 6.75% | 4.80% |
S&P 500® Composite Index* | 5.20% | 14.33% | 7.85% |
Barclays U.S. Intermediate Government/Credit Index* | 1.86% | 2.30% | 4.22% |
(a) | The total returns do not reflect the deduction of taxes that a shareholder would pay on Portfolio distributions or the redemption of Portfolio shares. |
* | The S&P 500® Composite Index is comprised of 500 U.S. stocks and is an indicator of the performance of the overall U.S. stock market. The Barclays U.S. Intermediate Government/Credit Index is the non-securitized component of the U.S. Aggregate Index, and includes Treasuries, government-related issues, and corporates. An investor cannot invest in an index and its returns are not indicative of the performance of any specific investment. |
7
NEW CENTURY INTERNATIONAL PORTFOLIO
PERFORMANCE CHARTS (Unaudited)
Comparison of the Change in Value of a $10,000 Investment
in New Century International Portfolio, MSCI EAFE Index
and MSCI ACWI ex-USA Index
Average Annual Total Returns For Periods Ended October 31, 2015 | |||
1 Year | 5 Years | 10 Years | |
New Century International Portfolio (a) | 0.45% | 2.65% | 4.30% |
MSCI EAFE Index* | (0.07%) | 4.81% | 4.06% |
MSCI ACWI ex-USA Index* | (4.68%) | 2.61% | 4.16% |
(a) | The total returns do not reflect the deduction of taxes that a shareholder would pay on Portfolio distributions or the redemption of Portfolio shares. |
* | The MSCI EAFE (Europe, Australasia and Far East) Index is a free float weighted capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. and Canada. The MSCI ACWI ex-USA Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets. The index consists of 45 country indices comprising 22 developed and 23 emerging market country indices. An investor cannot invest in an index and its returns are not indicative of the performance of any specific investment. |
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NEW CENTURY ALTERNATIVE STRATEGIES PORTFOLIO
PERFORMANCE CHARTS (Unaudited)
Comparison of the Change in Value of a $10,000 Investment
in New Century Alternative Strategies Portfolio, S&P 500® Composite Index
and Barclays U.S. Intermediate Government/Credit Index
Average Annual Total Returns For Periods Ended October 31, 2015 | |||
1 Year | 5 Years | 10 Years | |
New Century Alternative Strategies Portfolio (a) | (3.56%) | 2.10% | 2.73% |
S&P 500® Composite Index* | 5.20% | 14.33% | 7.85% |
Barclays U.S. Intermediate Government/Credit Index* | 1.86% | 2.30% | 4.22% |
(a) | The total returns do not reflect the deduction of taxes that a shareholder would pay on Portfolio distributions or the redemption of Portfolio shares. |
* | The S&P 500® Composite Index is comprised of 500 U.S. stocks and is an indicator of the performance of the overall U.S. stock market. The Barclays U.S. Intermediate Government/Credit Index is the non-securitized component of the U.S. Aggregate Index, and includes Treasuries, government-related issues, and corporates. An investor cannot invest in an index and its returns are not indicative of the performance of any specific investment. |
9
NEW CENTURY CAPITAL PORTFOLIO
PORTFOLIO INFORMATION (Unaudited)
October 31, 2015
Asset Allocation (% of Net Assets) |
Top Ten Long-Term Holdings |
Security Description | % of Net Assets |
Vanguard Dividend Growth Fund - Investor Shares | 7.3% |
Vanguard 500 Index Fund - Admiral Shares | 7.3% |
Putnam Equity Income Fund - Class Y | 6.4% |
Wells Fargo Advantage Growth Fund - Institutional Class | 5.4% |
American Funds AMCAP Fund - Class A | 4.3% |
Glenmede Large Cap Growth Portfolio | 4.1% |
Glenmede Large Cap Core Portfolio | 3.9% |
MFS Growth Fund - Class I | 3.8% |
Fidelity Select Health Care Portfolio | 3.5% |
JPMorgan Value Advantage Fund - Institutional Class | 3.5% |
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NEW CENTURY CAPITAL PORTFOLIO |
INVESTMENT COMPANIES — 96.2% | Shares | Value | ||||||
Large-Cap Funds — 60.7% | ||||||||
American Funds AMCAP Fund - Class A (b) | 167,170 | $ | 4,632,270 | |||||
ClearBridge Aggressive Growth Fund - Class I (b) | 9,452 | 2,051,590 | ||||||
DFA U.S. Large Cap Value Portfolio - Institutional Class | 58,502 | 1,946,376 | ||||||
Dodge & Cox Stock Fund | 14,433 | 2,526,283 | ||||||
Glenmede Large Cap Core Portfolio | 188,967 | 4,221,526 | ||||||
Glenmede Large Cap Growth Portfolio | 179,490 | 4,433,396 | ||||||
iShares MSCI USA Minimum Volatility ETF (a) | 88,200 | 3,700,872 | ||||||
iShares S&P 500 Growth ETF (a) | 29,200 | 3,445,308 | ||||||
iShares S&P 500 Value ETF (a) | 23,105 | 2,084,764 | ||||||
JPMorgan Value Advantage Fund - Institutional Class | 127,086 | 3,736,317 | ||||||
MFS Growth Fund - Class I (b) | 53,430 | 4,087,942 | ||||||
Putnam Equity Income Fund - Class Y | 335,102 | 6,943,323 | ||||||
Vanguard 500 Index Fund - Admiral Shares | 40,754 | 7,827,651 | ||||||
Vanguard Dividend Growth Fund - Investor Shares | 337,036 | 7,846,191 | ||||||
Wells Fargo Advantage Growth Fund - Institutional Class (b) | 112,473 | 5,858,697 | ||||||
65,342,506 | ||||||||
Sector Funds — 18.3% | ||||||||
Fidelity Select Health Care Portfolio | 17,537 | 3,754,284 | ||||||
Financial Select Sector SPDR Fund (a) | 40,000 | 963,200 | ||||||
First Trust Dow Jones Internet Index Fund (a) (b) | 30,000 | 2,232,000 | ||||||
iShares U.S. Energy ETF (a) | 33,400 | 1,279,554 | ||||||
Ivy Science and Technology Fund - Class I (b) | 58,266 | 3,294,942 | ||||||
Market Vectors Retail ETF (a) | 18,000 | 1,386,000 | ||||||
PowerShares Dynamic Pharmaceuticals Portfolio (a) | 47,000 | 3,310,210 | ||||||
SPDR S&P Regional Banking ETF (a) | 37,400 | 1,601,842 | ||||||
Vanguard Consumer Discretionary ETF (a) | 15,000 | 1,905,150 | ||||||
19,727,182 | ||||||||
Mid-Cap Funds — 9.3% | ||||||||
iShares S&P Mid-Cap 400 Growth ETF (a) | 12,600 | 2,081,268 | ||||||
iShares S&P Mid-Cap 400 Value ETF (a) | 12,100 | 1,481,161 | ||||||
John Hancock Disciplined Value Mid Cap Fund - Class I | 120,540 | 2,491,562 | ||||||
Putnam Equity Spectrum Fund - Class Y | 51,979 | 2,047,975 | ||||||
SPDR S&P MidCap 400 ETF Trust (a) | 7,102 | 1,865,766 | ||||||
9,967,732 | ||||||||
International Funds — 4.8% | ||||||||
iShares Currency Hedged MSCI Japan ETF (a) | 25,000 | 744,250 | ||||||
JOHCM International Select Fund - Class I | 19,227 | 349,937 | ||||||
Lazard International Strategic Equity Portfolio - Institutional Shares | 141,135 | 1,957,546 | ||||||
MFS International Value Fund - Class I | 57,929 | 2,147,449 | ||||||
5,199,182 |
See accompanying notes to financial statements.
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NEW CENTURY CAPITAL PORTFOLIO |
INVESTMENT COMPANIES — 96.2% (Continued) | Shares | Value | ||||||
Small-Cap Funds — 3.1% | ||||||||
Goldman Sachs Small Cap Growth Insights Fund - Institutional Class (b) | 18,364 | $ | 651,190 | |||||
Hodges Small Cap Fund - Institutional Class | 111,104 | 2,139,855 | ||||||
iShares S&P Small-Cap 600 Value ETF (a) | 5,200 | 579,956 | ||||||
3,371,001 | ||||||||
Total Investment Companies (Cost $77,897,876) | $ | 103,607,603 |
MONEY MARKET FUNDS — 3.9% | Shares | Value | ||||||
Invesco STIT-STIC Prime Portfolio (The) - Institutional Class, 0.08% (c) (Cost $4,202,489) | 4,202,489 | $ | 4,202,489 | |||||
Total Investments at Value — 100.1% (Cost $82,100,365) | $ | 107,810,092 | ||||||
Liabilities in Excess of Other Assets — (0.1%) | (117,475 | ) | ||||||
Net Assets — 100.0% | $ | 107,692,617 |
(a) | Exchange-traded fund. |
(b) | Non-income producing security. |
(c) | The rate shown is the 7-day effective yield as of October 31, 2015. |
See accompanying notes to financial statements.
12
NEW CENTURY BALANCED PORTFOLIO
PORTFOLIO INFORMATION (Unaudited)
October 31, 2015
Asset Allocation (% of Net Assets) |
![](https://capedge.com/proxy/N-CSR/0001111830-16-001041/fp0017237_6.jpg)
Top Ten Long-Term Holdings |
Security Description | % of Net Assets |
PIMCO Income Fund - Institutional Class | 6.4% |
iShares Core S&P 500 ETF | 5.6% |
JPMorgan Value Advantage Fund - Institutional Class | 5.5% |
American Funds AMCAP Fund - Class A | 5.1% |
Dodge & Cox Income Fund | 4.7% |
Loomis Sayles Bond Fund - Institutional Class | 4.7% |
John Hancock Disciplined Value Fund - Class I | 4.3% |
SPDR S&P MidCap 400 ETF Trust | 4.2% |
First Eagle Global Fund - Class A | 3.8% |
Fidelity Select Health Care Portfolio | 3.6% |
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NEW CENTURY BALANCED PORTFOLIO |
INVESTMENT COMPANIES — 94.3% | Shares | Value | ||||||
Large-Cap Funds — 28.6% | ||||||||
American Funds AMCAP Fund - Class A (b) | 125,960 | $ | 3,490,344 | |||||
ClearBridge Aggressive Growth Fund - Class I (b) | 9,420 | 2,044,686 | ||||||
iShares Core S&P 500 ETF (a) | 18,100 | 3,783,805 | ||||||
John Hancock Disciplined Value Fund - Class I | 156,480 | 2,904,266 | ||||||
JPMorgan Hedged Equity Fund - Select Class | 73,386 | 1,167,562 | ||||||
JPMorgan Value Advantage Fund - Institutional Class | 126,240 | 3,711,447 | ||||||
Wells Fargo Advantage Growth Fund - Institutional Class (b) | 43,741 | 2,278,494 | ||||||
19,380,604 | ||||||||
Fixed Income/Multi-Sector Bond Funds — 23.2% | ||||||||
Angel Oak Multi-Strategy Income Fund - Class I | 105,783 | 1,241,897 | ||||||
BlackRock Strategic Income Opportunities Portfolio - Institutional Shares | 225,815 | 2,251,372 | ||||||
Dodge & Cox Income Fund | 236,475 | 3,199,509 | ||||||
Loomis Sayles Bond Fund - Institutional Class | 228,436 | 3,195,812 | ||||||
PIMCO Income Fund - Institutional Class | 356,664 | 4,351,301 | ||||||
Western Asset Core Plus Bond Fund - Class I | 129,287 | 1,495,854 | ||||||
15,735,745 | ||||||||
International Funds — 13.6% | ||||||||
Dodge & Cox International Stock Fund | 5,228 | 208,561 | ||||||
First Eagle Global Fund - Class A | 48,265 | 2,562,868 | ||||||
Harding, Loevner International Equity Portfolio - Institutional Class | 120,516 | 2,131,936 | ||||||
JOHCM International Select Fund - Class I | 12,864 | 234,124 | ||||||
John Hancock International Growth Fund - Class I | 71,683 | 1,559,811 | ||||||
Lazard Global Listed Infrastructure Portfolio - Institutional Shares | 104,222 | 1,498,710 | ||||||
Pear Tree Polaris Foreign Value Small Cap Fund - Institutional Shares | 79,722 | 1,006,892 | ||||||
9,202,902 | ||||||||
Sector Funds — 11.8% | ||||||||
Fidelity Select Health Care Portfolio | 11,341 | 2,427,778 | ||||||
iShares U.S. Energy ETF (a) | 14,000 | 536,340 | ||||||
Oppenheimer SteelPath MLP Select 40 Fund - Class Y (b) | 88,540 | 896,908 | ||||||
Putnam Absolute Return 500 Fund - Class Y | 131,926 | 1,530,343 | ||||||
SPDR S&P Regional Banking ETF (a) | 30,000 | 1,284,900 | ||||||
Vanguard Global Minimum Volatility Fund - Admiral Shares | 54,558 | 1,288,664 | ||||||
7,964,933 | ||||||||
Mid-Cap Funds — 6.4% | ||||||||
John Hancock Disciplined Value Mid Cap Fund - Class I | 72,324 | 1,494,937 | ||||||
SPDR S&P MidCap 400 ETF Trust (a) | 10,780 | 2,832,014 | ||||||
4,326,951 |
See accompanying notes to financial statements.
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NEW CENTURY BALANCED PORTFOLIO |
INVESTMENT COMPANIES — 94.3% (Continued) | Shares | Value | ||||||
Convertible Bond Funds — 4.0% | ||||||||
AllianzGI Convertible & Income Fund II (c) | 110,600 | $ | 623,784 | |||||
AllianzGI Convertible Fund - Institutional Class | 63,656 | 2,104,478 | ||||||
2,728,262 | ||||||||
Small-Cap Funds — 3.6% | ||||||||
Brown Capital Management Small Company Fund - Institutional Class (b) | 16,264 | 1,276,101 | ||||||
iShares S&P Small-Cap 600 Value ETF (a) | 10,700 | 1,193,371 | ||||||
2,469,472 | ||||||||
High Yield Bond Funds — 3.1% | ||||||||
Loomis Sayles Institutional High Income Fund | 199,407 | 1,381,892 | ||||||
Western Asset High Income Opportunity Fund, Inc. (c) | 150,000 | 729,000 | ||||||
2,110,892 | ||||||||
Total Investment Companies (Cost $53,269,507) | $ | 63,919,761 |
STRUCTURED NOTES — 3.1% | Par Value | Value | ||||||
BNP Paribas Return Enhanced Notes Linked to the Performance of PowerShares S&P 500 Low Volatility Portfolio, due 03/31/2017 (b) | $ | 750,000 | $ | 918,017 | ||||
JPMorgan Chase & Co., Certificates of Deposit Linked to the JPMorgan Efficiente Plus DS 5 Index, due 06/23/2020 (b) | 1,250,000 | 1,190,875 | ||||||
Total Structured Notes (Cost $2,000,000) | $ | 2,108,892 |
MONEY MARKET FUNDS — 2.7% | Shares | Value | ||||||
Invesco STIT-STIC Prime Portfolio (The) - Institutional Class, 0.08% (d) (Cost $1,809,656) | 1,809,656 | $ | 1,809,656 | |||||
Total Investments at Value — 100.1% (Cost $57,079,163) | $ | 67,838,309 | ||||||
Liabilities in Excess of Other Assets — (0.1%) | (62,509 | ) | ||||||
Net Assets — 100.0% | $ | 67,775,800 |
(a) | Exchange-traded fund. |
(b) | Non-income producing security. |
(c) | Closed-end fund. |
(d) | The rate shown is the 7-day effective yield as of October 31, 2015. |
See accompanying notes to financial statements.
15
NEW CENTURY INTERNATIONAL PORTFOLIO
PORTFOLIO INFORMATION (Unaudited)
October 31, 2015
Asset Allocation (% of Net Assets) |
![](https://capedge.com/proxy/N-CSR/0001111830-16-001041/fp0017237_5.jpg)
Top Ten Long-Term Holdings |
Security Description | % of Net Assets |
T. Rowe Price European Stock Fund | 7.1% |
Matthews Japan Fund - Institutional Class | 7.0% |
Franklin Mutual European Fund - Class A | 6.4% |
WisdomTree Japan Hedged Equity Fund | 6.1% |
iShares MSCI United Kingdom ETF | 5.4% |
Oakmark International Fund - Class I | 4.9% |
John Hancock International Growth Fund - Class I | 4.8% |
MFS International Value Fund - Class I | 4.5% |
Matthews Pacific Tiger Fund - Investor Class | 4.3% |
WisdomTree Europe Hedged Equity Fund | 4.3% |
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NEW CENTURY INTERNATIONAL PORTFOLIO |
INVESTMENT COMPANIES — 96.1% | Shares | Value | ||||||
Europe Funds — 38.2% | ||||||||
Columbia European Equity Fund - Class A | 254,806 | $ | 1,773,450 | |||||
DFA United Kingdom Small Company Portfolio - Institutional Class | 15,655 | 555,743 | ||||||
Franklin Mutual European Fund - Class A | 168,363 | 3,411,048 | ||||||
Invesco European Growth Fund - Class Y | 13,646 | 501,637 | ||||||
iShares MSCI France ETF (a) | 30,000 | 773,700 | ||||||
iShares MSCI Germany ETF (a) | 47,600 | 1,290,436 | ||||||
iShares MSCI Ireland Capped ETF (a) | 25,000 | 986,000 | ||||||
iShares MSCI Switzerland Capped ETF (a) | 45,600 | 1,448,712 | ||||||
iShares MSCI United Kingdom ETF (a) | 165,146 | 2,885,101 | ||||||
T. Rowe Price European Stock Fund | 182,994 | 3,753,203 | ||||||
WisdomTree Europe Hedged Equity Fund (a) | 37,500 | 2,279,250 | ||||||
WisdomTree Europe SmallCap Dividend Fund (a) | 10,000 | 560,400 | ||||||
20,218,680 | ||||||||
Diversified Funds — 33.4% | ||||||||
Deutsche X-Trackers MSCI EAFE Hedged Equity ETF (a) | 40,000 | 1,115,200 | ||||||
DFA International Small Cap Value Portfolio - Institutional Class | 25,433 | 494,415 | ||||||
Dodge & Cox International Stock Fund | 32,631 | 1,301,649 | ||||||
iShares MSCI EAFE Minimum Volatility ETF (a) | 13,500 | 888,570 | ||||||
Ivy International Core Equity Fund - Class I | 66,988 | 1,163,585 | ||||||
JOHCM International Select Fund - Class I | 56,575 | 1,029,665 | ||||||
John Hancock International Growth Fund - Class I | 116,768 | 2,540,869 | ||||||
Lazard Global Listed Infrastructure Portfolio - Institutional Shares | 107,987 | 1,552,850 | ||||||
MFS International Value Fund - Class I | 64,485 | 2,390,465 | ||||||
Oakmark International Fund - Class I | 110,184 | 2,593,730 | ||||||
Pear Tree Polaris Foreign Value Small Cap Fund - Institutional Shares | 69,073 | 872,393 | ||||||
Templeton Institutional Foreign Smaller Companies Series | 82,457 | 1,773,652 | ||||||
17,717,043 | ||||||||
Asia/Pacific Funds — 22.3% | ||||||||
iShares MSCI Australia ETF (a) | 45,100 | 853,292 | ||||||
Matthews China Dividend Fund - Investor Class | 54,010 | 770,179 | ||||||
Matthews India Fund - Investor Class | 34,471 | 945,880 | ||||||
Matthews Japan Fund - Institutional Class | 203,805 | 3,711,290 | ||||||
Matthews Pacific Tiger Fund - Investor Class | 88,092 | 2,300,101 | ||||||
WisdomTree Japan Hedged Equity Fund (a) | 61,000 | 3,250,690 | ||||||
11,831,432 | ||||||||
Diversified Emerging Markets Funds — 2.2% | ||||||||
William Blair Emerging Markets Small Cap Growth Fund - Class I | 73,544 | 1,173,759 | ||||||
Total Investment Companies (Cost $46,119,166) | $ | 50,940,914 |
See accompanying notes to financial statements.
17
NEW CENTURY INTERNATIONAL PORTFOLIO |
MONEY MARKET FUNDS — 4.0% | Shares | Value | ||||||
Invesco STIT-STIC Prime Portfolio (The) - Institutional Class, 0.08% (b) (Cost $2,104,593) | 2,104,593 | $ | 2,104,593 | |||||
Total Investments at Value — 100.1% (Cost $48,223,759) | $ | 53,045,507 | ||||||
Liabilities in Excess of Other Assets — (0.1%) | (57,628 | ) | ||||||
Net Assets — 100.0% | $ | 52,987,879 |
(a) | Exchange-traded fund. |
(b) | The rate shown is the 7-day effective yield as of October 31, 2015. |
See accompanying notes to financial statements.
18
NEW CENTURY ALTERNATIVE STRATEGIES PORTFOLIO
PORTFOLIO INFORMATION (Unaudited)
October 31, 2015
Asset Allocation (% of Net Assets) |
![](https://capedge.com/proxy/N-CSR/0001111830-16-001041/fp0017237_4.jpg)
Top Ten Long-Term Holdings |
Security Description | % of Net Assets |
Boston Partners Long/Short Research Fund - Institutional Class | 6.0% |
361 Managed Futures Strategy Fund - Class I | 5.5% |
Calamos Market Neutral Income Fund - Class A | 5.3% |
Berwyn Income Fund | 5.3% |
First Eagle Global Fund - Class A | 5.3% |
The Merger Fund - Investor Class | 4.9% |
John Hancock Global Absolute Return Strategies Fund - Class I | 4.8% |
Weitz Partners III Opportunity Fund - Institutional Class | 4.6% |
FPA Crescent Fund | 4.3% |
Touchstone Merger Arbitrage Fund - Institutional Class | 3.6% |
19
NEW CENTURY ALTERNATIVE STRATEGIES PORTFOLIO |
INVESTMENT COMPANIES — 92.1% | Shares | Value | ||||||
Long/Short Equity Funds — 18.0% | ||||||||
Boston Partners Long/Short Research Fund - Institutional Class (b) | 357,014 | $ | 5,580,123 | |||||
Goldman Sachs Long Short Fund - Institutional Shares (b) | 147,128 | 1,353,578 | ||||||
Gotham Absolute Return Fund - Institutional Class | 80,773 | 1,042,775 | ||||||
TFS Market Neutral Fund (b) | 89,616 | 1,398,009 | ||||||
Vanguard Market Neutral Fund - Investor Shares (b) | 253,516 | 3,070,082 | ||||||
Weitz Partners III Opportunity Fund - Institutional Class (b) | 292,520 | 4,273,716 | ||||||
16,718,283 | ||||||||
Arbitrage Funds — 17.0% | ||||||||
Calamos Market Neutral Income Fund - Class A | 380,856 | 4,981,595 | ||||||
Kellner Merger Fund - Institutional Class | 275,681 | 3,002,168 | ||||||
The Merger Fund - Investor Class | 293,037 | 4,553,802 | ||||||
Touchstone Merger Arbitrage Fund - Institutional Class (b) | 308,509 | 3,331,893 | ||||||
15,869,458 | ||||||||
Global Macro Funds — 14.0% | ||||||||
Calamos Global Dynamic Income Fund (d) | 96,000 | 737,280 | ||||||
First Eagle Global Fund - Class A | 93,219 | 4,949,933 | ||||||
Franklin Mutual Global Discovery Fund - Class Z | 90,453 | 2,944,256 | ||||||
John Hancock Global Absolute Return Strategies Fund - Class I | 397,243 | 4,449,117 | ||||||
13,080,586 | ||||||||
Managed Futures Funds — 10.8% | ||||||||
361 Managed Futures Strategy Fund - Class I | 453,710 | 5,117,845 | ||||||
AQR Managed Futures Strategy Fund - Class N | 282,922 | 3,041,413 | ||||||
ASG Managed Futures Strategy Fund - Class Y | 179,856 | 1,929,856 | ||||||
10,089,114 | ||||||||
Asset Allocation Funds — 9.6% | ||||||||
Berwyn Income Fund | 378,652 | 4,971,706 | ||||||
FPA Crescent Fund | 118,375 | 3,951,367 | ||||||
8,923,073 | ||||||||
High Yield/Fixed Income Funds — 9.1% | ||||||||
BlackRock Credit Allocation Income Trust (d) | 70,000 | 877,100 | ||||||
PIMCO Corporate & Income Strategy Fund (d) | 16,000 | 220,160 | ||||||
PIMCO Dynamic Credit Income Fund (d) | 60,000 | 1,125,600 | ||||||
PIMCO Income Fund - Institutional Class | 165,240 | 2,015,932 | ||||||
PIMCO Income Strategy Fund II (d) | 126,000 | 1,161,720 | ||||||
Templeton Global Bond Fund - Class A | 38,926 | 458,156 | ||||||
Templeton Global Income Fund (d) | 403,000 | 2,631,590 | ||||||
8,490,258 | ||||||||
Natural Resources Funds — 5.5% | ||||||||
First Eagle Gold Fund - Class I (b) | 72,254 | 909,682 | ||||||
Oppenheimer SteelPath MLP Select 40 Fund - Class Y (b) | 121,727 | 1,233,096 | ||||||
SPDR Gold Trust (a) (b) (c) | 4,800 | 524,640 | ||||||
Tortoise MLP & Pipeline Fund - Institutional Class | 190,751 | 2,422,542 | ||||||
5,089,960 |
See accompanying notes to financial statements.
20
NEW CENTURY ALTERNATIVE STRATEGIES PORTFOLIO |
INVESTMENT COMPANIES — 92.1% (Continued) | Shares | Value | ||||||
Real Estate Funds — 5.0% | ||||||||
CBRE Clarion Global Real Estate Income Fund (d) | 147,500 | $ | 1,177,050 | |||||
Vanguard REIT ETF (a) | 17,900 | 1,430,031 | ||||||
Versus Capital Multi-Manager Real Estate Income Fund | 56,370 | 1,502,818 | ||||||
Voya Global Real Estate Fund - Class I | 25,126 | 502,762 | ||||||
4,612,661 | ||||||||
Option Hedged Funds — 3.1% | ||||||||
BlackRock Enhanced Equity Dividend Trust (d) | 120,000 | 918,000 | ||||||
JPMorgan Hedged Equity Fund - Select Class | 121,997 | 1,940,967 | ||||||
2,858,967 | ||||||||
Total Investment Companies (Cost $78,762,012) | $ | 85,732,360 |
STRUCTURED NOTES — 4.6% | Par Value | Value | ||||||
BNP Paribas Buffered Return Enhanced Notes Linked to the Performance of WTI Crude Oil, due 03/24/2016 (b) | $ | 1,500,000 | $ | 871,731 | ||||
JPMorgan Chase & Co., Certificates of Deposit Linked to the JPMorgan Efficiente Plus DS 5 Index, | 1,600,000 | 1,524,320 | ||||||
JPMorgan Chase & Co., Dual Directional Contingent Buffered Return Enhanced Notes Linked to the EURO STOXX 50 Index, due 12/14/2016 (b) | 1,800,000 | 1,883,160 | ||||||
Total Structured Notes (Cost $4,900,000) | $ | 4,279,211 |
MONEY MARKET FUNDS — 3.1% | Shares | Value | ||||||
Invesco STIT-STIC Prime Portfolio (The) - Institutional Class, 0.08% (e) (Cost $2,893,888) | 2,893,888 | $ | 2,893,888 | |||||
Total Investments at Value — 99.8% (Cost $86,555,900) | $ | 92,905,459 | ||||||
Other Assets in Excess of Liabilities — 0.2% | 218,841 | |||||||
Net Assets — 100.0% | $ | 93,124,300 |
(a) | Exchange-traded fund. |
(b) | Non-income producing security. |
(c) | For federal income tax purposes, structured as a grantor trust. |
(d) | Closed-end fund. |
(e) | The rate shown is the 7-day effective yield as of October 31, 2015. |
See accompanying notes to financial statements.
21
NEW CENTURY PORTFOLIOS |
| New Century Capital Portfolio | New Century Balanced Portfolio | New Century International Portfolio | New Century Alternative Strategies Portfolio | ||||||||||||
ASSETS | ||||||||||||||||
Investments in securities: | ||||||||||||||||
At acquisition cost | $ | 82,100,365 | $ | 57,079,163 | $ | 48,223,759 | $ | 86,555,900 | ||||||||
At value (Note 1A) | $ | 107,810,092 | $ | 67,838,309 | $ | 53,045,507 | $ | 92,905,459 | ||||||||
Cash | — | — | — | 5,604 | ||||||||||||
Dividends receivable | 283 | 41,256 | 149 | 39,904 | ||||||||||||
Receivable for investment securities sold | — | — | — | 240,213 | ||||||||||||
Receivable for capital shares sold | 592 | 1,456 | 681 | 40,198 | ||||||||||||
Other assets | 6,558 | 4,131 | 3,293 | 5,788 | ||||||||||||
TOTAL ASSETS | 107,817,525 | 67,885,152 | 53,049,630 | 93,237,166 | ||||||||||||
LIABILITIES | ||||||||||||||||
Payable for investment securities purchased | — | 31,360 | — | 3,183 | ||||||||||||
Payable for capital shares redeemed | — | — | — | 17,701 | ||||||||||||
Payable to Adviser (Note 2) | 91,634 | 55,378 | 46,224 | 61,737 | ||||||||||||
Payable to Distributor (Note 3) | 22,500 | 14,300 | 8,346 | 19,720 | ||||||||||||
Other accrued expenses | 10,774 | 8,314 | 7,181 | 10,525 | ||||||||||||
TOTAL LIABILITIES | 124,908 | 109,352 | 61,751 | 112,866 | ||||||||||||
NET ASSETS | $ | 107,692,617 | $ | 67,775,800 | $ | 52,987,879 | $ | 93,124,300 | ||||||||
Net assets consist of: | ||||||||||||||||
Paid-in capital | $ | 72,217,868 | $ | 53,265,898 | $ | 42,792,330 | $ | 86,658,528 | ||||||||
Accumulated net investment income (loss) | 38,193 | 7,281 | 372,796 | (245,556 | ) | |||||||||||
Accumulated net realized gains on investments | 9,726,829 | 3,743,475 | 5,001,005 | 361,769 | ||||||||||||
Net unrealized appreciation on investments | 25,709,727 | 10,759,146 | 4,821,748 | 6,349,559 | ||||||||||||
Net assets | $ | 107,692,617 | $ | 67,775,800 | $ | 52,987,879 | $ | 93,124,300 | ||||||||
Shares of beneficial interest outstanding (unlimited number of shares authorized, no par value) | 5,732,068 | 4,474,474 | 4,042,935 | 7,428,940 | ||||||||||||
Net asset value, offering price and redemption price per share (a) | $ | 18.79 | $ | 15.15 | $ | 13.11 | $ | 12.54 |
(a) | Redemption price may differ from the net asset value per share depending upon the length of time held (Note 1B). |
See accompanying notes to financial statements.
22
NEW CENTURY PORTFOLIOS |
| New Century Capital Portfolio | New Century Balanced Portfolio | New Century International Portfolio | New Century Alternative Strategies Portfolio | ||||||||||||
INVESTMENT INCOME | ||||||||||||||||
Dividends | $ | 1,736,888 | $ | 1,795,226 | $ | 1,451,734 | $ | 2,422,944 | ||||||||
EXPENSES | ||||||||||||||||
Investment advisory fees (Note 2) | 1,100,465 | 660,856 | 553,789 | 803,014 | ||||||||||||
Distribution costs (Note 3) | 271,012 | 153,460 | 116,912 | 212,604 | ||||||||||||
Accounting fees | 51,536 | 40,747 | 36,626 | 49,834 | ||||||||||||
Trustees’ fees (Note 2) | 49,373 | 31,055 | 24,097 | 46,134 | ||||||||||||
Legal and audit fees | 41,696 | 29,866 | 25,109 | 40,508 | ||||||||||||
Administration fees (Note 2) | 42,280 | 27,736 | 22,199 | 40,025 | ||||||||||||
Transfer agent fees | 27,670 | 21,876 | 19,657 | 26,797 | ||||||||||||
Custody and bank service fees | 20,358 | 14,615 | 12,793 | 21,435 | ||||||||||||
Insurance expense | 9,469 | 5,991 | 4,838 | 9,563 | ||||||||||||
Postage & supplies | 7,713 | 4,596 | 4,613 | 7,570 | ||||||||||||
Other expenses | 11,716 | 10,050 | 9,271 | 18,246 | ||||||||||||
Total expenses | 1,633,288 | 1,000,848 | 829,904 | 1,275,730 | ||||||||||||
NET INVESTMENT INCOME | 103,600 | 794,378 | 621,830 | 1,147,214 | ||||||||||||
REALIZED AND UNREALIZED GAINS (LOSSES) ON INVESTMENTS | ||||||||||||||||
Net realized gains on investments | 6,439,711 | 2,011,401 | 3,643,254 | 1,604,506 | ||||||||||||
Capital gain distributions from regulated investment companies | 3,649,047 | 1,886,686 | 1,358,019 | 2,356,058 | ||||||||||||
Net change in unrealized appreciation (depreciation) on investments | (8,731,786 | ) | (6,100,130 | ) | (5,462,919 | ) | (8,560,792 | ) | ||||||||
NET REALIZED AND UNREALIZED GAINS (LOSSES) ON INVESTMENTS | 1,356,972 | (2,202,043 | ) | (461,646 | ) | (4,600,228 | ) | |||||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $ | 1,460,572 | $ | (1,407,665 | ) | $ | 160,184 | $ | (3,453,014 | ) |
See accompanying notes to financial statements.
23
NEW CENTURY PORTFOLIOS |
New Century | ||||||||
| Year Ended October 31, 2015 | Year Ended October 31, 2014 | ||||||
FROM OPERATIONS | ||||||||
Net investment income (loss) | $ | 103,600 | $ | (65,407 | ) | |||
Net realized gains from security transactions | 6,439,711 | 12,309,795 | ||||||
Capital gain distributions from regulated investment companies | 3,649,047 | 2,163,549 | ||||||
Net change in unrealized appreciation (depreciation) on investments | (8,731,786 | ) | (1,938,516 | ) | ||||
Net increase in net assets from operations | 1,460,572 | 12,469,421 | ||||||
DISTRIBUTIONS TO SHAREHOLDERS | ||||||||
From net realized gains on security transactions (Note 1E) | (14,111,794 | ) | (10,250,145 | ) | ||||
FROM CAPITAL SHARE TRANSACTIONS | ||||||||
Proceeds from shares sold | 2,018,578 | 1,834,772 | ||||||
Proceeds from redemption fees collected (Note 1B) | 450 | 136 | ||||||
Net asset value of shares issued in reinvestment of distributions to shareholders | 13,577,593 | 9,899,484 | ||||||
Payments for shares redeemed | (10,206,553 | ) | (11,828,041 | ) | ||||
Net increase (decrease) in net assets from capital share transactions | 5,390,068 | (93,649 | ) | |||||
TOTAL INCREASE (DECREASE) IN NET ASSETS | (7,261,154 | ) | 2,125,627 | |||||
NET ASSETS | ||||||||
Beginning of year | 114,953,771 | 112,828,144 | ||||||
End of year | $ | 107,692,617 | $ | 114,953,771 | ||||
ACCUMULATED NET INVESTMENT INCOME (LOSS) | $ | 38,193 | $ | (65,407 | ) | |||
CAPITAL SHARE ACTIVITY | ||||||||
Shares sold | 103,562 | 90,311 | ||||||
Shares reinvested | 720,297 | 497,461 | ||||||
Shares redeemed | (525,929 | ) | (576,155 | ) | ||||
Net increase in shares outstanding | 297,930 | 11,617 | ||||||
Shares outstanding, beginning of year | 5,434,138 | 5,422,521 | ||||||
Shares outstanding, end of year | 5,732,068 | 5,434,138 |
See accompanying notes to financial statements.
24
NEW CENTURY PORTFOLIOS |
New Century | ||||||||
| Year Ended October 31, 2015 | Year Ended October 31, 2014 | ||||||
FROM OPERATIONS | ||||||||
Net investment income | $ | 794,378 | $ | 637,899 | ||||
Net realized gains from security transactions | 2,011,401 | 3,628,603 | ||||||
Capital gain distributions from regulated investment companies | 1,886,686 | 1,240,264 | ||||||
Net change in unrealized appreciation (depreciation) on investments | (6,100,130 | ) | (62,987 | ) | ||||
Net increase (decrease) in net assets from operations | (1,407,665 | ) | 5,443,779 | |||||
DISTRIBUTIONS TO SHAREHOLDERS | ||||||||
From net investment income (Note 1E) | (819,672 | ) | (790,570 | ) | ||||
From net realized gains on security transactions (Note 1E) | (4,869,042 | ) | (3,999,254 | ) | ||||
Decrease in net assets from distributions to shareholders | (5,688,714 | ) | (4,789,824 | ) | ||||
FROM CAPITAL SHARE TRANSACTIONS | ||||||||
Proceeds from shares sold | 3,042,189 | 3,165,864 | ||||||
Proceeds from redemption fees collected (Note 1B) | 69 | — | ||||||
Net asset value of shares issued in reinvestment of distributions to shareholders | 5,346,443 | 4,582,522 | ||||||
Payments for shares redeemed | (7,253,329 | ) | (6,122,526 | ) | ||||
Net increase in net assets from capital share transactions | 1,135,372 | 1,625,860 | ||||||
TOTAL INCREASE (DECREASE) IN NET ASSETS | (5,961,007 | ) | 2,279,815 | |||||
NET ASSETS | ||||||||
Beginning of year | 73,736,807 | 71,456,992 | ||||||
End of year | $ | 67,775,800 | $ | 73,736,807 | ||||
ACCUMULATED NET INVESTMENT INCOME | $ | 7,281 | $ | 32,950 | ||||
CAPITAL SHARE ACTIVITY | ||||||||
Shares sold | 194,377 | 191,900 | ||||||
Shares reinvested | 345,600 | 286,766 | ||||||
Shares redeemed | (455,573 | ) | (373,561 | ) | ||||
Net increase in shares outstanding | 84,404 | 105,105 | ||||||
Shares outstanding, beginning of year | 4,390,070 | 4,284,965 | ||||||
Shares outstanding, end of year | 4,474,474 | 4,390,070 |
See accompanying notes to financial statements.
25
NEW CENTURY PORTFOLIOS |
New Century | ||||||||
| Year Ended October 31, 2015 | Year Ended October 31, 2014 | ||||||
FROM OPERATIONS | ||||||||
Net investment income | $ | 621,830 | $ | 393,493 | ||||
Net realized gains from security transactions | 3,643,254 | 5,452,098 | ||||||
Capital gain distributions from regulated investment companies | 1,358,019 | 589,544 | ||||||
Net change in unrealized appreciation (depreciation) on investments | (5,462,919 | ) | (6,883,739 | ) | ||||
Net increase (decrease) in net assets from operations | 160,184 | (448,604 | ) | |||||
DISTRIBUTIONS TO SHAREHOLDERS | ||||||||
From net investment income (Note 1E) | (642,401 | ) | (361,371 | ) | ||||
From net realized gains on security transactions (Note 1E) | (6,041,792 | ) | (4,279,496 | ) | ||||
Decrease in net assets from distributions to shareholders | (6,684,193 | ) | (4,640,867 | ) | ||||
FROM CAPITAL SHARE TRANSACTIONS | ||||||||
Proceeds from shares sold | 2,686,446 | 1,123,604 | ||||||
Proceeds from redemption fees collected (Note 1B) | 363 | 2 | ||||||
Net asset value of shares issued in reinvestment of distributions to shareholders | 6,541,948 | 4,538,606 | ||||||
Payments for shares redeemed | (5,789,633 | ) | (7,207,518 | ) | ||||
Net increase (decrease) in net assets from capital share transactions | 3,439,124 | (1,545,306 | ) | |||||
TOTAL DECREASE IN NET ASSETS | (3,084,885 | ) | (6,634,777 | ) | ||||
NET ASSETS | ||||||||
Beginning of year | 56,072,764 | 62,707,541 | ||||||
End of year | $ | 52,987,879 | $ | 56,072,764 | ||||
ACCUMULATED NET INVESTMENT INCOME | $ | 372,796 | $ | 393,443 | ||||
CAPITAL SHARE ACTIVITY | ||||||||
Shares sold | 196,264 | 73,873 | ||||||
Shares reinvested | 507,915 | 296,060 | ||||||
Shares redeemed | (423,665 | ) | (467,703 | ) | ||||
Net increase (decrease) in shares outstanding | 280,514 | (97,770 | ) | |||||
Shares outstanding, beginning of year | 3,762,421 | 3,860,191 | ||||||
Shares outstanding, end of year | 4,042,935 | 3,762,421 |
See accompanying notes to financial statements.
26
NEW CENTURY PORTFOLIOS |
New Century Alternative Strategies Portfolio | ||||||||
| Year Ended October 31, 2015 | Year Ended October 31, 2014 | ||||||
FROM OPERATIONS | ||||||||
Net investment income | $ | 1,147,214 | $ | 817,361 | ||||
Net realized gains from security transactions | 1,604,506 | 1,346,766 | ||||||
Capital gain distributions from regulated investment companies | 2,356,058 | 1,612,359 | ||||||
Net change in unrealized appreciation (depreciation) on investments | (8,560,792 | ) | (1,966,593 | ) | ||||
Net increase (decrease) in net assets from operations | (3,453,014 | ) | 1,809,893 | |||||
DISTRIBUTIONS TO SHAREHOLDERS | ||||||||
From net investment income (Note 1E) | (1,227,530 | ) | (748,917 | ) | ||||
FROM CAPITAL SHARE TRANSACTIONS | ||||||||
Proceeds from shares sold | 7,355,390 | 12,507,050 | ||||||
Proceeds from redemption fees collected (Note 1B) | 2,417 | 335 | ||||||
Net asset value of shares issued in reinvestment of distributions to shareholders | 1,192,680 | 721,862 | ||||||
Payments for shares redeemed | (32,292,139 | ) | (16,154,264 | ) | ||||
Net decrease in net assets from capital share transactions | (23,741,652 | ) | (2,925,017 | ) | ||||
TOTAL DECREASE IN NET ASSETS | (28,422,196 | ) | (1,864,041 | ) | ||||
NET ASSETS | ||||||||
Beginning of year | 121,546,496 | 123,410,537 | ||||||
End of year | $ | 93,124,300 | $ | 121,546,496 | ||||
ACCUMULATED NET INVESTMENT LOSS | $ | (245,556 | ) | $ | (165,240 | ) | ||
CAPITAL SHARE ACTIVITY | ||||||||
Shares sold | 567,487 | 950,486 | ||||||
Shares reinvested | 92,099 | 55,358 | ||||||
Shares redeemed | (2,483,406 | ) | (1,229,535 | ) | ||||
Net decrease in shares outstanding | (1,823,820 | ) | (223,691 | ) | ||||
Shares outstanding, beginning of year | 9,252,760 | 9,476,451 | ||||||
Shares outstanding, end of year | 7,428,940 | 9,252,760 |
See accompanying notes to financial statements.
27
NEW CENTURY CAPITAL PORTFOLIO |
Selected Per Share Data and Ratios for a Share Outstanding Throughout Each Year | ||||||||||||||||||||
| Years Ended October 31, | |||||||||||||||||||
2015 | 2014 | 2013 | 2012 | 2011 | ||||||||||||||||
PER SHARE OPERATING PERFORMANCE | ||||||||||||||||||||
Net asset value, beginning of year | $ | 21.15 | $ | 20.81 | $ | 17.55 | $ | 16.11 | $ | 15.41 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.02 | (0.01 | ) | (0.00 | )(a) | (0.01 | ) | (0.04 | ) | |||||||||||
Net realized and unrealized gains on investments | 0.24 | 2.29 | 4.11 | 1.54 | 0.74 | |||||||||||||||
Total from investment operations | 0.26 | 2.28 | 4.11 | 1.53 | 0.70 | |||||||||||||||
Less distributions: | ||||||||||||||||||||
Distributions from net realized gains | (2.62 | ) | (1.94 | ) | (0.85 | ) | (0.09 | ) | — | |||||||||||
Proceeds from redemption fees collected (Note 1B) | 0.00 | (a) | 0.00 | (a) | 0.00 | (a) | — | — | ||||||||||||
Net asset value, end of year | $ | 18.79 | $ | 21.15 | $ | 20.81 | $ | 17.55 | $ | 16.11 | ||||||||||
TOTAL RETURN (b) | 1.20 | % | 11.53 | % | 24.45 | % | 9.57 | % | 4.54 | % | ||||||||||
RATIOS/SUPPLEMENTAL DATA | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 107,693 | $ | 114,954 | $ | 112,828 | $ | 87,664 | $ | 88,602 | ||||||||||
Ratio of expenses to average net assets (c) | 1.44 | % | 1.41 | % | 1.43 | % | 1.46 | % | 1.42 | % | ||||||||||
Ratio of net investment income (loss) to average net assets (d) | 0.09 | % | (0.06 | %) | (0.00 | %) | (0.05 | %) | (0.25 | %) | ||||||||||
Portfolio turnover | 32 | % | 26 | % | 28 | % | 7 | % | 60 | % |
(a) | Amount rounds to less than $0.01 per share. |
(b) | Total return is a measure of the change in the value of an investment in the Portfolio over the years covered, which assumes dividends or capital gains distributions, if any, are reinvested in shares of the Portfolio. Returns shown do not reflect the taxes a shareholder would pay on Portfolio distributions, if any, or the redemption of Portfolio shares. |
(c) | The ratios of expenses to average net assets do not reflect the Portfolio’s proportionate share of expenses of the underlying investment companies in which the Portfolio invests (Note 2). |
(d) | Recognition of net investment income (loss) by the Portfolio is affected by the timing of the declaration of dividends by the underlying investment companies in which the Portfolio invests. |
See accompanying notes to financial statements.
28
NEW CENTURY BALANCED PORTFOLIO |
Selected Per Share Data and Ratios for a Share Outstanding Throughout Each Year | ||||||||||||||||||||
| Years Ended October 31, | |||||||||||||||||||
2015 | 2014 | 2013 | 2012 | 2011 | ||||||||||||||||
PER SHARE OPERATING PERFORMANCE | ||||||||||||||||||||
Net asset value, beginning of year | $ | 16.80 | $ | 16.68 | $ | 14.56 | $ | 13.59 | $ | 13.22 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income | 0.19 | 0.15 | 0.18 | 0.17 | 0.20 | |||||||||||||||
Net realized and unrealized gains (losses) on investments | (0.51 | ) | 1.10 | 2.12 | 0.97 | 0.37 | ||||||||||||||
Total from investment operations | (0.32 | ) | 1.25 | 2.30 | 1.14 | 0.57 | ||||||||||||||
Less distributions: | ||||||||||||||||||||
Distributions from net investment income | (0.19 | ) | (0.19 | ) | (0.18 | ) | (0.17 | ) | (0.20 | ) | ||||||||||
Distributions from net realized gains | (1.14 | ) | (0.94 | ) | — | — | — | |||||||||||||
Total distributions | (1.33 | ) | (1.13 | ) | (0.18 | ) | (0.17 | ) | (0.20 | ) | ||||||||||
Proceeds from redemption fees collected (Note 1B) | 0.00 | (a) | — | 0.00 | (a) | 0.00 | (a) | 0.00 | (a) | |||||||||||
Net asset value, end of year | $ | 15.15 | $ | 16.80 | $ | 16.68 | $ | 14.56 | $ | 13.59 | ||||||||||
TOTAL RETURN (b) | (2.04 | %) | 7.81 | % | 15.97 | % | 8.54 | % | 4.29 | % | ||||||||||
RATIOS/SUPPLEMENTAL DATA | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 67,776 | $ | 73,737 | $ | 71,457 | $ | 66,826 | $ | 64,582 | ||||||||||
Ratio of expenses to average net assets (c) | 1.40 | % | 1.40 | % | 1.43 | % | 1.45 | % | 1.43 | % | ||||||||||
Ratio of net investment income to average net assets (d) | 1.11 | % | 0.88 | % | 1.17 | % | 1.18 | % | 1.39 | % | ||||||||||
Portfolio turnover | 33 | % | 16 | % | 21 | % | 13 | % | 17 | % |
(a) | Amount rounds to less than $0.01 per share. |
(b) | Total return is a measure of the change in the value of an investment in the Portfolio over the years covered, which assumes dividends or capital gains distributions, if any, are reinvested in shares of the Portfolio. Returns shown do not reflect the taxes a shareholder would pay on Portfolio distributions, if any, or the redemption of Portfolio shares. |
(c) | The ratios of expenses to average net assets do not reflect the Portfolio’s proportionate share of expenses of the underlying investment companies in which the Portfolio invests (Note 2). |
(d) | Recognition of net investment income by the Portfolio is affected by the timing of the declaration of dividends by the underlying investment companies in which the Portfolio invests. |
See accompanying notes to financial statements.
29
NEW CENTURY INTERNATIONAL PORTFOLIO |
Selected Per Share Data and Ratios for a Share Outstanding Throughout Each Year | ||||||||||||||||||||
| Years Ended October 31, | |||||||||||||||||||
| 2015 | 2014 | 2013 | 2012 | 2011 | |||||||||||||||
PER SHARE OPERATING PERFORMANCE | ||||||||||||||||||||
Net asset value, beginning of year | $ | 14.90 | $ | 16.24 | $ | 13.92 | $ | 13.41 | $ | 14.53 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income | 0.16 | 0.11 | 0.11 | 0.15 | 0.10 | |||||||||||||||
Net realized and unrealized gains (losses) on investments | (0.13 | ) | (0.22 | ) | 2.37 | 0.46 | (1.14 | ) | ||||||||||||
Total from investment operations | 0.03 | (0.11 | ) | 2.48 | 0.61 | (1.04 | ) | |||||||||||||
Less distributions: | ||||||||||||||||||||
Distributions from net investment income | (0.17 | ) | (0.10 | ) | (0.16 | ) | (0.10 | ) | (0.08 | ) | ||||||||||
Distributions from net realized gains | (1.65 | ) | (1.13 | ) | — | — | — | |||||||||||||
Total distributions | (1.82 | ) | (1.23 | ) | (0.16 | ) | (0.10 | ) | (0.08 | ) | ||||||||||
Proceeds from redemption fees collected (Note 1B) | 0.00 | (a) | 0.00 | (a) | 0.00 | (a) | 0.00 | (a) | 0.00 | (a) | ||||||||||
Net asset value, end of year | $ | 13.11 | $ | 14.90 | $ | 16.24 | $ | 13.92 | $ | 13.41 | ||||||||||
TOTAL RETURN (b) | 0.45 | % | (0.89 | %) | 17.95 | % | 4.60 | % | (7.22 | %) | ||||||||||
RATIOS/SUPPLEMENTAL DATA | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 52,988 | $ | 56,073 | $ | 62,708 | $ | 57,266 | $ | 61,262 | ||||||||||
Ratios of expenses to average net assets (c) | 1.50 | % | 1.47 | % | 1.43 | % | 1.50 | % | 1.46 | % | ||||||||||
Ratios of net investment income to average net assets (d) | 1.12 | % | 0.66 | % | 0.67 | % | 1.03 | % | 0.63 | % | ||||||||||
Portfolio turnover | 54 | % | 22 | % | 32 | % | 4 | % | 13 | % |
(a) | Amount rounds to less than $0.01 per share. |
(b) | Total return is a measure of the change in the value of an investment in the Portfolio over the years covered, which assumes dividends or capital gains distributions, if any, are reinvested in shares of the Portfolio. Returns shown do not reflect the taxes a shareholder would pay on Portfolio distributions, if any, or the redemption of Portfolio shares. |
(c) | The ratios of expenses to average net assets do not reflect the Portfolio’s proportionate share of expenses of the underlying investment companies in which the Portfolio invests (Note 2). |
(d) | Recognition of net investment income by the Portfolio is affected by the timing of the declaration of dividends by the underlying investment companies in which the Portfolio invests. |
See accompanying notes to financial statements.
30
NEW CENTURY ALTERNATIVE STRATEGIES PORTFOLIO |
Selected Per Share Data and Ratios for a Share Outstanding Throughout Each Year | ||||||||||||||||||||
| Years Ended October 31, | |||||||||||||||||||
| 2015 | 2014 | 2013 | 2012 | 2011 | |||||||||||||||
PER SHARE OPERATING PERFORMANCE | ||||||||||||||||||||
Net asset value, beginning of year | $ | 13.14 | $ | 13.02 | $ | 12.24 | $ | 11.80 | $ | 11.87 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income | 0.12 | 0.09 | 0.05 | 0.14 | 0.17 | |||||||||||||||
Net realized and unrealized gains (losses) on investments | (0.58 | ) | 0.11 | 0.80 | 0.47 | (0.09 | ) | |||||||||||||
Total from investment operations | (0.46 | ) | 0.20 | 0.85 | 0.61 | 0.08 | ||||||||||||||
Less distributions: | ||||||||||||||||||||
Distributions from net investment income | (0.14 | ) | (0.08 | ) | (0.07 | ) | (0.17 | ) | (0.15 | ) | ||||||||||
Proceeds from redemption fees collected (Note 1B) | 0.00 | (a) | 0.00 | (a) | 0.00 | (a) | 0.00 | (a) | 0.00 | (a) | ||||||||||
Net asset value, end of year | $ | 12.54 | $ | 13.14 | $ | 13.02 | $ | 12.24 | $ | 11.80 | ||||||||||
TOTAL RETURN (b) | (3.56 | %) | 1.53 | % | 6.99 | % | 5.26 | % | 0.62 | % | ||||||||||
RATIOS/SUPPLEMENTAL DATA | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 93,124 | $ | 121,546 | $ | 123,411 | $ | 117,272 | $ | 114,841 | ||||||||||
Ratio of expenses to average net assets (c) | 1.19 | % | 1.14 | % | 1.13 | % | 1.11 | % | 1.09 | % | ||||||||||
Ratio of net investment income to average net assets (d) | 1.07 | % | 0.66 | % | 0.39 | % | 1.15 | % | 1.48 | % | ||||||||||
Portfolio turnover | 40 | % | 29 | % | 25 | % | 32 | % | 31 | % |
(a) | Amount rounds to less than $0.01 per share. |
(b) | Total return is a measure of the change in the value of an investment in the Portfolio over the years covered, which assumes dividends or capital gains distributions, if any, are reinvested in shares of the Portfolio. Returns shown do not reflect the taxes a shareholder would pay on Portfolio distributions, if any, or the redemption of Portfolio shares. |
(c) | The ratios of expenses to average net assets do not reflect the Portfolio’s proportionate share of expenses of the underlying investment companies in which the Portfolio invests (Note 2). |
(d) | Recognition of net investment income by the Portfolio is affected by the timing of the declaration of dividends by the underlying investment companies in which the Portfolio invests. |
See accompanying notes to financial statements.
31
NEW CENTURY PORTFOLIOS
NOTES TO FINANCIAL STATEMENTS
October 31, 2015
(1) | SIGNIFICANT ACCOUNTING POLICIES |
New Century Portfolios (“New Century”) is organized as a Massachusetts business trust which is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company and currently offers shares of four series: New Century Capital Portfolio, New Century Balanced Portfolio, New Century International Portfolio and New Century Alternative Strategies Portfolio (together, the “Portfolios” and each, a “Portfolio”). New Century Capital Portfolio and New Century Balanced Portfolio commenced operations on January 31, 1989. New Century International Portfolio commenced operations on November 1, 2000, and New Century Alternative Strategies Portfolio commenced operations on May 1, 2002.
Weston Financial Group, Inc. (the “Adviser”), a wholly-owned subsidiary of The Washington Trust Company, serves as the investment adviser to each Portfolio. Weston Securities Corporation (the “Distributor”), a wholly-owned subsidiary of Washington Trust Bancorp, Inc., serves as the distributor and principal underwriter to each Portfolio.
The investment objective of New Century Capital Portfolio is to provide capital growth, with a secondary objective to provide income, while managing risk. This Portfolio seeks to achieve its objective by investing primarily in shares of other registered investment companies, including exchange-traded funds (“ETFs”), that emphasize investments in equity securities (domestic and foreign).
The investment objective of New Century Balanced Portfolio is to provide income, with a secondary objective to provide capital growth, while managing risk. This Portfolio seeks to achieve its objective by investing primarily in shares of other registered investment companies, including ETFs, that emphasize investments in equity securities (domestic and foreign), fixed income (domestic and foreign), or in a composite of such securities. This Portfolio maintains at least 25% of its assets in fixed income securities by selecting registered investment companies that invest in such securities.
The investment objective of New Century International Portfolio is to provide capital growth, with a secondary objective to provide income, while managing risk. This Portfolio seeks to achieve its objective by investing primarily in shares of registered investment companies, including ETFs, which emphasize investments in equities but which focus on securities in foreign and emerging markets, and with less emphasis on securities in domestic markets.
The investment objective of New Century Alternative Strategies Portfolio is to provide total return while managing risk. This Portfolio seeks to achieve its objective by investing primarily in shares of other registered investment companies, including ETFs and closed-end funds, that emphasize alternative strategies and have low correlation to the securities in the S&P 500 Composite Index.
32
NEW CENTURY PORTFOLIOS
NOTES TO FINANCIAL STATEMENTS (Continued)
October 31, 2015
The price of shares of each Portfolio fluctuates daily and there is no assurance that the Portfolios will be successful in achieving their stated investment objectives.
As an investment company, as defined in Financial Accounting Standards Board (“FASB”) Accounting Standards Update 2013-08, each Portfolio follows accounting and reporting guidance under FASB Accounting Standards Codification Topic 946, “Financial Services – Investment Companies.” The following is a summary of significant accounting policies followed by the Portfolios in the preparation of their financial statements. These policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”).
A. | Investment Valuation |
Investments in shares of other open-end investment companies are valued at their net asset value as reported by such companies. The net asset value as reported by open-end investment companies may be based on fair value pricing; to understand the fair value pricing process used by such companies, consult their most current prospectus. The Portfolios may also invest in closed-end investment companies, ETF’s, and to a certain extent, directly in securities when the Adviser deems it appropriate. Investments in closed-end investment companies, ETF’s and direct investments in securities are valued at market prices, as described in the paragraph below.
Investments in securities traded on a national securities exchange or included in NASDAQ are generally valued at the last reported sales price, the closing price or the official closing price; and securities traded in the over-the-counter market and listed securities for which no sale is reported on that date are valued at the last reported bid price. It is expected that fixed income securities will ordinarily be traded in the over-the-counter market. When market quotations are not readily available, fixed income securities may be valued on the basis of prices provided by an independent pricing service. Other assets and securities for which no quotations are readily available or for which quotations the Adviser believes do not reflect market value are valued at their fair value as determined in good faith by the Adviser under the procedures established by the Board of Trustees, and will be classified as Level 2 or 3 within the fair value hierarchy (see below), depending on the inputs used. Factors considered in determining the value of portfolio investments subject to fair value determination include, but are not limited to, the following: only a bid price or an asked price is available; the spread between bid and asked prices is substantial; infrequency of sales; thinness of market; the size of reported trades; a temporary lapse in the provision of prices by any reliable pricing source; and actions of the securities or future markets, such as the suspension or limitation of trading.
33
NEW CENTURY PORTFOLIOS |
GAAP establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. Various inputs are used in determining the value of the Portfolios’ investments. These inputs are summarized in the three broad levels listed below:
● | Level 1 – quoted prices in active markets for identical securities |
● | Level 2 – other significant observable inputs |
● | Level 3 – significant unobservable inputs |
Structured Notes held by New Century Balanced and New Century Alternative Strategies Portfolios are typically classified as Level 2 since the values for such securities are customarily based on prices provided by an independent pricing service that utilizes various “other significant observable inputs” including bid and ask quotations, prices of similar securities, underlying index values and interest rates, among other factors.
The inputs or methodology used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level of the fair value hierarchy within which the fair value measurement of that security is determined to fall in its entirety is the lowest level input that is significant to the fair value measurement.
The following is a summary of the inputs used to value each Portfolio’s investments by security type as of October 31, 2015:
New Century Capital Portfolio | ||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Investment Companies | $ | 103,607,603 | $ | — | $ | — | $ | 103,607,603 | ||||||||
Money Market Funds | 4,202,489 | — | — | 4,202,489 | ||||||||||||
Total | $ | 107,810,092 | $ | — | $ | — | $ | 107,810,092 |
New Century Balanced Portfolio | ||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Investment Companies | $ | 63,919,761 | $ | — | $ | — | $ | 63,919,761 | ||||||||
Structured Notes | — | 2,108,892 | — | 2,108,892 | ||||||||||||
Money Market Funds | 1,809,656 | — | — | 1,809,656 | ||||||||||||
Total | $ | 65,729,417 | $ | 2,108,892 | $ | — | $ | 67,838,309 |
34
NEW CENTURY PORTFOLIOS |
New Century International Portfolio | ||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Investment Companies | $ | 50,940,914 | $ | — | $ | — | $ | 50,940,914 | ||||||||
Money Market Funds | 2,104,593 | — | — | 2,104,593 | ||||||||||||
Total | $ | 53,045,507 | $ | — | $ | — | $ | 53,045,507 |
New Century Alternative Strategies Portfolio | ||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Investment Companies | $ | 85,732,360 | $ | — | $ | — | $ | 85,732,360 | ||||||||
Structured Notes | — | 4,279,211 | — | 4,279,211 | ||||||||||||
Money Market Funds | 2,893,888 | — | — | 2,893,888 | ||||||||||||
Total | $ | 88,626,248 | $ | 4,279,211 | $ | — | $ | 92,905,459 |
Refer to each Portfolio’s Schedule of Investments for a listing of the securities using Level 1 and Level 2 inputs. As of October 31, 2015, the Portfolios did not have any transfers into and out of any Level. In addition, the Portfolios did not have derivative instruments or any assets or liabilities that were measured at fair value on a recurring basis using significant unobservable inputs (Level 3) as of October 31, 2015. It is the Portfolios’ policy to recognize transfers into and out of any Level at the end of the reporting period.
B. | Share Valuation |
The net asset value per share of each Portfolio is calculated daily by dividing the total value of its assets, less liabilities, by the number of shares outstanding. The offering price and redemption price per share of each Portfolio is equal to the net asset value per share, except that shares of each Portfolio are subject to a redemption fee of 2% if redeemed within 30 days of the date of purchase. This redemption fee applies to all shareholders and accounts; however, each Portfolio reserves the right to waive such redemption fees on employer sponsored retirement accounts. No redemption fee is imposed on the exchange of shares among the various Portfolios of the Trust, the redemption of shares representing reinvested dividends or capital gain distributions, or on amounts representing capital appreciation of shares. During the years ended October 31, 2015 and 2014, proceeds from redemption fees totaled $450 and $136, respectively, for New Century Capital Portfolio; $69 and $0, respectively, for New Century Balanced Portfolio; $363 and $2, respectively, for New Century International Portfolio; and $2,417 and $335, respectively, for New Century Alternative Strategies Portfolio. Any redemption fees collected are credited to paid-in capital of the applicable Portfolio.
C. | Investment Transactions |
Investment transactions are recorded on a trade date basis for financial reporting purposes. Gains and losses on securities sold are determined on a specific identification method.
35
NEW CENTURY PORTFOLIOS
NOTES TO FINANCIAL STATEMENTS (Continued)
October 31, 2015
D. | Income Recognition |
Interest income, if any, is accrued on portfolio investments daily. Dividend income and capital gain distributions are recorded on the ex-dividend date or as soon as the information is available if after the ex-dividend date.
E. | Distributions to Shareholders |
Dividends arising from net investment income, if any, are declared and paid semi-annually to shareholders of New Century Balanced and New Century Alternative Strategies Portfolios. Dividends from net investment income, if any, are declared and paid annually to shareholders of New Century Capital and New Century International Portfolios. Net realized short-term capital gains, if any, may be distributed throughout the year and net realized long-term capital gains, if any, are distributed annually. Income distributions and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP.
The tax character of distributions paid during the years ended October 31, 2015 and 2014 was as follows:
Year Ended | Ordinary Income | Long-Term Capital Gains | Total Distributions | |||||||||
New Century Capital Portfolio | ||||||||||||
October 31, 2015 | $ | — | $ | 14,111,794 | $ | 14,111,794 | ||||||
October 31, 2014 | $ | 100,544 | $ | 10,149,601 | $ | 10,250,145 | ||||||
New Century Balanced Portfolio | ||||||||||||
October 31, 2015 | $ | 912,546 | $ | 4,776,168 | $ | 5,688,714 | ||||||
October 31, 2014 | $ | 790,570 | $ | 3,999,254 | $ | 4,789,824 | ||||||
New Century International Portfolio | ||||||||||||
October 31, 2015 | $ | 699,568 | $ | 5,984,625 | $ | 6,684,193 | ||||||
October 31, 2014 | $ | 361,371 | $ | 4,279,496 | $ | 4,640,867 | ||||||
New Century Alternative Strategies Portfolio | ||||||||||||
October 31, 2015 | $ | 1,227,530 | $ | — | $ | 1,227,530 | ||||||
October 31, 2014 | $ | 748,917 | $ | — | $ | 748,917 |
F. | Cost of Operations |
The Portfolios bear all costs of their operations other than expenses specifically assumed by the Adviser. Expenses directly attributable to a Portfolio are charged to that Portfolio; other expenses are allocated proportionately among the Portfolios in relation to the net assets of each Portfolio.
36
NEW CENTURY PORTFOLIOS
NOTES TO FINANCIAL STATEMENTS (Continued)
October 31, 2015
G. | Use of Estimates |
In preparing financial statements in accordance with GAAP, management is required to make estimates and assumptions that affect the reported amount of assets and liabilities, the disclosure of contingent assets and liabilities, and revenues and expenses during the reporting period. Actual results could differ from those estimates.
(2) | INVESTMENT ADVISORY AGREEMENT, ADMINISTRATION AGREEMENT AND TRUSTEES’ FEES |
Each Portfolio has entered into an Investment Advisory Agreement with the Adviser. Investment advisory fees for each Portfolio are computed daily and paid monthly. The investment advisory fees for each of New Century Capital and New Century International Portfolios are computed at an annualized rate of 1.00% (100 basis points) on the first $100 million of average daily net assets and 0.75% (75 basis points) of average daily net assets exceeding that amount. The investment advisory fees for New Century Balanced Portfolio are computed at an annualized rate of 1.00% (100 basis points) on the first $50 million of average daily net assets and 0.75% (75 basis points) of average daily net assets exceeding that amount. The investment advisory fees for New Century Alternative Strategies Portfolio are computed at an annualized rate of 0.75% (75 basis points) of average daily net assets. The advisory fees are calculated based on the net assets of each Portfolio separately, and not on the total net assets of the Portfolios combined.
The Adviser has contractually agreed to limit the total expenses of each Portfolio (excluding interest, taxes, brokerage, acquired fund fees and expenses and extraordinary expenses) to an annual rate of 1.50% of average net assets. The limitation on total expenses does not include a Portfolio’s proportionate share of expenses of the underlying investment companies (i.e. acquired fund fees and expenses) in which such Portfolio invests. This contractual agreement is in place until March 1, 2016. During the year ended October 31, 2015, no reduction of advisory fees was necessary with respect to any Portfolio.
Any advisory fee reductions and/or any other operating expenses absorbed by the Adviser pursuant to the expense limitation agreement shall be reimbursed by the Portfolio to the Adviser, if so requested by the Adviser, provided the aggregate amount of the Portfolio’s current total operating expenses for such year does not exceed the applicable existing limitation on Portfolio expenses, and the reimbursement is made within three years after the year in which the Adviser incurred the expense. As of October 31, 2015, there are no such amounts due to the Adviser.
Fees paid by the Portfolios pursuant to an Administration Agreement with the Adviser to administer the ordinary course of the Portfolios’ business are paid monthly based on actual expenses incurred in the oversight of the Portfolios’ affairs.
37
NEW CENTURY PORTFOLIOS
NOTES TO FINANCIAL STATEMENTS (Continued)
October 31, 2015
The Portfolios pay each Trustee who is not affiliated with the Adviser a $12,000 annual retainer, paid quarterly, and a per meeting fee of $6,000 for regularly scheduled Board meetings, and a per meeting fee of $2,000 for Audit Committee meetings. The Portfolios will also pay each Trustee who is not affiliated with the Adviser a $6,000 special Board meeting fee if such meeting is held independently of a regularly scheduled meeting and $2,000 special Audit Committee meeting fee if such Audit Committee meeting is held independently of a regularly scheduled meetinng. Any Trustee who is affiliated with the Adviser and any officer of New Century does not receive compensation from the Portfolios at this time.
Certain officers and Trustees of New Century are also officers and/or directors of the Adviser and are not paid any fees by the Portfolios for serving in such capacities.
(3) | DISTRIBUTION PLAN AND OTHER TRANSACTIONS WITH RELATED PARTIES |
The Portfolios have adopted a Distribution Plan (the “Plan”) under Section 12(b) of the Investment Company Act of 1940, as amended, and Rule 12b-1 thereunder. Under the Plan, each Portfolio may pay up to 0.25% (25 basis points) of its average daily net assets to the Distributor for activities primarily intended to result in the sale of shares. Under its terms, the Plan shall remain in effect from year to year, provided such continuance is approved annually by a vote of a majority of the Trustees and a majority of those Trustees who are not “interested persons” of the Portfolios and who have no direct or indirect financial interest in the operation of the Plan or in any agreement related to the Plan.
During the year ended October 31, 2015, the Distributor received $271,012, $153,460, $116,912 and $212,604 from New Century Capital, New Century Balanced, New Century International and New Century Alternative Strategies Portfolios, respectively, pursuant to the Plan. As described below, these net amounts were offset by the sales commissions and other compensation received by the Distributor.
During the year ended October 31, 2015, the Distributor also received sales commissions and other compensation of $12,431, $26,617, $19,087 and $54,873 in connection with the purchase of investment company shares by New Century Capital, New Century Balanced, New Century International and New Century Alternative Strategies Portfolios, respectively. The Distributor has agreed to reduce payments made by each Portfolio pursuant to the Plan in amounts equal to the sales commissions and other compensation it has received as a result of a Portfolio’s investment in other investment companies.
Certain officers and Trustees of New Century are also officers and/or directors of the Distributor and are not paid any fees by the Portfolios for serving in such capacities.
38
NEW CENTURY PORTFOLIOS
NOTES TO FINANCIAL STATEMENTS (Continued)
October 31, 2015
(4) | INVESTMENT TRANSACTIONS |
During the year ended October 31, 2015, the cost of purchases and the proceeds from sales of securities, other than short-term investments and U.S. government securities, were as follows:
| New Century Capital Portfolio | New Century Balanced Portfolio | New Century International Portfolio | New Century Alternative Strategies Portfolio | ||||||||||||
Purchase of investment securities | $ | 35,725,875 | $ | 23,465,458 | $ | 29,147,980 | $ | 42,648,179 | ||||||||
Proceeds from sales of investment securities | $ | 42,785,835 | $ | 26,324,662 | $ | 31,841,857 | $ | 65,984,650 |
(5) | TAX MATTERS |
Each Portfolio has qualified and intends to continue to qualify as a regulated investment company under the Internal Revenue Code of 1986, as amended (the “Code”). Qualification generally will relieve the Portfolios of liability for federal income taxes to the extent 100% of their net investment income and net realized capital gains are distributed in accordance with the Code.
In order to avoid imposition of the excise tax applicable to regulated investment companies, it is also each Portfolio’s intention to declare as dividends in each calendar year at least 98% of its net investment income (earned during the calendar year) and 98.2% of its net realized capital gains (earned during the twelve months ended October 31) plus undistributed amounts from prior years.
The tax character of accumulated earnings at October 31, 2015 was as follows:
New Century Capital Portfolio | New Century Balanced Portfolio | New Century International Portfolio | New Century Alternative Strategies Portfolio | |||||||||||||
Undistributed ordinary income | $ | 38,193 | $ | 7,281 | $ | 372,796 | $ | — | ||||||||
Net unrealized appreciation | 25,709,727 | 10,612,493 | 4,728,276 | 6,234,485 | ||||||||||||
Undistributed long-term gains | 9,726,829 | 3,890,128 | 5,094,477 | 476,843 | ||||||||||||
Qualified ordinary late year losses | — | — | — | (245,556 | ) | |||||||||||
Total accumulated earnings | $ | 35,474,749 | $ | 14,509,902 | $ | 10,195,549 | $ | 6,465,772 |
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NEW CENTURY PORTFOLIOS
NOTES TO FINANCIAL STATEMENTS (Continued)
October 31, 2015
The following information is based upon the federal income tax cost of investment securities as of October 31, 2015:
| New Century Capital Portfolio | New Century Balanced Portfolio | New Century International Portfolio | New Century Alternative Strategies Portfolio | ||||||||||||
Federal income tax cost | $ | 82,100,365 | $ | 57,225,816 | $ | 48,317,231 | $ | 86,670,974 | ||||||||
Gross unrealized appreciation | $ | 26,426,989 | $ | 11,030,776 | $ | 6,099,901 | $ | 8,756,654 | ||||||||
Gross unrealized depreciation | (717,262 | ) | (418,283 | ) | (1,371,625 | ) | (2,522,169 | ) | ||||||||
Net unrealized appreciation | $ | 25,709,727 | $ | 10,612,493 | $ | 4,728,276 | $ | 6,234,485 |
The difference between the federal income tax cost of portfolio investments and the financial statement cost of portfolio investments for New Century Balanced, New Century International and New Century Alternative Strategies Portfolios is due to certain timing differences in the recognition of capital losses under income tax regulations and GAAP. These “book/tax” differences are temporary in nature and are primarily due to the tax deferral of losses on wash sales.
During the year ended October 31, 2015, New Century Capital Portfolio and New Century Alternative Strategies Portfolio utilized $361,481 and $3,471,844, respectively, of short-term capital loss carryforwards to offset current year realized capital gains.
Net qualified ordinary late year losses, incurred after December 31, 2014 and within the taxable year, are deemed to arise on the first day of the Portfolios’ next taxable year. For the year ended October 31, 2015, New Century Alternative Strategies Portfolio intends to defer to November 1, 2015 for federal tax purposes qualified ordinary late year losses of $245,556.
For the year ended October 31, 2015, New Century Balanced Portfolio and New Century International Portfolio reclassified $375 and $76, respectively, of distributions in excess of net realized capital gains against net investment income. These reclassifications are reflected on the Statements of Assets and Liabilities. Such reclassifications, the result of permanent differences between the financial statement and income tax reporting requirements, have no effect on either Portfolio’s net assets or net asset value per share.
The Portfolios recognize the tax benefits or expenses of uncertain tax positions only when the positions are “more likely than not” to be sustained assuming examination by tax authorities. Management has reviewed the Portfolios’ tax positions taken on federal income tax returns for all open tax years (tax years ended October 31, 2012 through October 31, 2015) and has concluded that no provision for unrecognized tax benefits or expenses is required in these financial statements. Each Portfolio identifies its major tax jurisdiction as U.S. Federal.
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NEW CENTURY PORTFOLIOS
NOTES TO FINANCIAL STATEMENTS (Continued)
October 31, 2015
(6) | INVESTMENT IN OTHER INVESTMENT COMPANIES |
The Portfolios are funds of funds which invest primarily in the shares of registered open-end and closed-end investment companies, including exchange-traded investment companies, which are commonly referred to as “ETFs.” Thus, each Portfolio is affected by the performance of those companies. Investing in investment companies does not eliminate investment risk.
Closed-end investment companies and ETFs trade on securities exchanges, and the market price for which such securities trade may not correspond exactly with the net asset value of the investment company. In addition, a closed-end investment company may trade infrequently, with small volume and at a discount to the net asset value, which may affect the Portfolio’s ability to sell shares of such company at a reasonable price. Further, ETFs which hold stocks included in a particular index will not be able to perfectly replicate the performance of the indices they track because the total return generated by the securities will be reduced by transaction costs incurred in adjusting the actual balance of the securities.
(7) | CONTINGENCIES AND COMMITMENTS |
New Century indemnifies its officers and Trustees for certain liabilities that might arise from the performance of their duties to the Portfolios. Additionally, in the normal course of business, New Century, on behalf of its Portfolios, enters into contracts that contain a variety of representations and warranties and which provide general indemnifications. The Portfolios’ maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Portfolios that have not yet occurred. However, based on experience, New Century expects the risk of loss to be remote.
(8) | SUBSEQUENT EVENTS |
The Portfolios are required to recognize in the financial statements the effects of all subsequent events that provide additional evidence about conditions that existed as of the date of the Statements of Assets and Liabilities. For non-recognized subsequent events that must be disclosed to keep the financial statements from being misleading, the Portfolios are required to disclose the nature of the event as well as an estimate of its financial effect, or a statement that such an estimate cannot be made. Management has evaluated subsequent events through the issuance of these financial statements and has noted no such events.
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NEW CENTURY PORTFOLIOS
REPORT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
To the Board of Trustees
and the Shareholders of New Century Portfolios
We have audited the accompanying statements of assets and liabilities of New Century Capital Portfolio, New Century Balanced Portfolio, New Century International Portfolio and New Century Alternative Strategies Portfolio (the “Portfolios”), each a series of shares of beneficial interest in New Century Portfolios, including the schedules of investments, as of October 31, 2015, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the five-year period then ended. These financial statements and financial highlights are the responsibility of the Portfolios’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of October 31, 2015 by correspondence with the custodian. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of New Century Capital Portfolio, New Century Balanced Portfolio, New Century International Portfolio and New Century Alternative Strategies Portfolio as of October 31, 2015, and the results of their operations for the year then ended, the changes in their net assets for each of the years in the two-year period then ended and their financial highlights for each of the years in the five-year period then ended, in conformity with accounting principles generally accepted in the United States of America.
BBD, LLP |
Philadelphia, Pennsylvania
December 21, 2015
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NEW CENTURY PORTFOLIOS
BOARD OF TRUSTEES AND OFFICERS
(Unaudited)
Overall responsibility for management of New Century rests with the Board of Trustees. Each Trustee serves during his or her lifetime until such Trustee’s termination, or death, resignation, retirement or removal. The Trustees, in turn, elect the officers of New Century to actively supervise its day-to-day operations. The officers have been elected for an annual term. The following table provides information regarding each Trustee and executive officer of New Century:
Name, | Length | Position(s) | Principal Occupation(s) | Number of | Other |
Interested Trustee | |||||
*John W. Filoon, III | Since 2013 | Trustee | President, Chief Operating Officer and Director, Weston Financial Group, Inc.; CEO (since 2013), Secretary and Director (since 2011), and General Securities Principal (since 2012), Weston Securities Corporation; Managing Director of Investments, SVP Bank of America Merrill Lynch (2009-2011). | 4 | None |
Non-Interested Trustees | |||||
Stanley H. Cooper, Esq. | Since 2008 | Chairman | Attorney in private practice. | 4 | None |
J. Kevin Connaughton | Since 2015 | Trustee | Retired. Formerly President of the Columbia Funds, Managing Director of Columbia Management Investment Advisors, LLC (12/2008-2/2015). | 4 | Director, The Autism Project of RI |
Michael A. Diorio, CPA | Since 1988 | Trustee | Financial Consultant. | 4 | Director, The Milford National Bank & Trust Company since 1996 |
* | John W. Filoon, III is considered to be an “interested person” of the Trust within the meaning of Section 2(a)(19) of the Investment Company Act of 1940, as amended. Mr. Filoon is an interested person because he is an officer of the Adviser and the Distributor. |
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NEW CENTURY PORTFOLIOS
BOARD OF TRUSTEES AND OFFICERS
(Unaudited) (Continued)
Name, | Length | Position(s) | Principal Occupation(s) |
Executive Officers | |||
Nicole M. Tremblay, Esq. | Since 2011 | President (CEO) Chief Financial Officer, Treasurer, Secretary | Senior Vice President, Chief Compliance Officer, Weston Financial Group, Inc.; President, Chief Compliance Officer, and General Securities Principal, Weston Securities Corporation. |
Ronald A. Sugameli | Since 2015 | Senior Vice President | Portfolio Manager since 2002; Managing Director, Chief Investment Officer, Secretary, Weston Financial Group, Inc.; Vice President, Secretary, Weston Securities Corporation. |
Stephen G. DaCosta | Since 2011 | Chief Financial Officer, Treasurer | Vice President, Divisional Controller, Weston Financial Group, Inc.; Vice President, Financial Operations Principal, Weston Securities Corporation. |
Kimberly S. Berliner | Since 2014 | Vice President, Secretary | Senior Compliance Analyst, Weston Financial Group, Inc., since 2013; Portfolio Compliance Specialist, MFS Investment Management (2010-2011). |
Matthew I. Solomon 100 William Street, Wellesley, MA 02481 1979 | Since 2015 | Vice President | Vice President, Portfolio Manager since 2014, Weston Financial Group, Inc.; Vice President, Portfolio Manager New Century Portfolios since 2015; Manager, Investment Consultant, Investance America 2010-2014. |
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NEW CENTURY PORTFOLIOS
BOARD OF TRUSTEES AND OFFICERS
(Unaudited) (Continued)
Name, | Length | Position(s) | Principal Occupation(s) |
Executive Officers (Continued) | |||
William F. LeFavor 100 William Street, Wellesley, MA 02481 1983 | Since 2015 | Vice President | Assistant Portfolio Manager since 2012; Assistant Vice President, Financial Counselor, Weston Financial Group, Inc.; Registered Representative, Weston Securities Corporation. |
Ronald D. Halterman 100 William Street, Wellesley, MA 02481 1982 | Since 2015 | Vice President | Assistant Portfolio Manager since 2011; Associate Counselor, Weston Financial Group, Inc.; Registered Representative, Weston Securities Corporation. |
Additional information about members of the Board of Trustees and executive officers is available in the Statement of Additional Information (“SAI”). To obtain a free copy of the SAI, please call 1-888-639-0102.
Further, the Board of Trustees and New Century’s principal executive officer, principal financial officer and other persons performing similar functions have adopted a Code of Ethics. To obtain a free copy of the Code of Ethics, please call 1-888-639-0102.
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NEW CENTURY PORTFOLIOS
ABOUT YOUR PORTFOLIOS’ EXPENSES (Unaudited)
We believe it is important for you to understand the impact of costs on your investment. As a shareholder of the Portfolios, you may incur two types of costs: (1) transaction costs, including redemption fees; and (2) ongoing costs, including management fees, distribution (12b-1) fees and other expenses. The following examples are intended to help you understand ongoing costs (in dollars) of investing in the Portfolios and to compare these costs with the ongoing costs of investing in other mutual funds.
A mutual fund’s ongoing costs are expressed as a percentage of its average net assets. This figure is known as the expense ratio. The examples in the tables below are based on an investment of $1,000 made at the beginning of the period shown (May 1, 2015) and held until the end of the period (October 31, 2015).
The table below illustrates each Portfolio’s ongoing costs in two ways:
Actual fund return – This section helps you to estimate the actual expenses that you paid over the period. The “Ending Account Value” shown is derived from each Portfolio’s actual return, and the third column shows the dollar amount of operating expenses that would have been paid by an investor who started with an initial investment of $1,000 in each of the Portfolios. You may use the information here, together with the amount you invested, to estimate the expenses that you paid over the period.
To do so, 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 given for the Portfolios under the heading “Expenses Paid During Period.”
Hypothetical 5% return – This section is intended to help you compare the Portfolios’ ongoing costs with those of other mutual funds. It assumes that each Portfolio had an annual return of 5% before expenses during the period shown, but that the expense ratio is unchanged. In this case, because the return used is not the Portfolios’ actual returns, the results do not apply to your investment. The example is useful in making comparisons because the Securities and Exchange Commission (“SEC”) requires all mutual funds to calculate expenses based on a 5% return. You can assess each Portfolio’s ongoing costs by comparing this hypothetical example with the hypothetical examples that appear in shareholder reports of other mutual funds.
Note that expenses shown in the table are meant to highlight and help you compare ongoing costs only. The Portfolios do not charge sales loads. However, a redemption fee of 2% is applied on the sale of shares of the Portfolios held for less than 30 days.
The calculations assume no shares were bought or sold during the period. Your actual costs may have been higher or lower, depending on the amount of your investment and the timing of any purchases or redemptions. In addition, the calculations do not reflect the Portfolios’ proportionate shares of expenses of the underlying investment companies in which the Portfolios invest.
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NEW CENTURY PORTFOLIOS
ABOUT YOUR PORTFOLIOS’ EXPENSES (Unaudited)
(Continued)
More information about the Portfolios’ expenses, including recent annual expense ratios, can be found in this report. For additional information on operating expenses and other shareholder costs, please refer to the Portfolios’ prospectus.
Beginning Account Value May 1, 2015 | Ending October 31, 2015 | Net | Expenses Paid During Period(b) | |
New Century Capital Portfolio | ||||
Actual | $1,000.00 | $971.60 | 1.45% | $7.21 |
Hypothetical 5% Return (before expenses) | $1,000.00 | $1,017.90 | 1.45% | $7.37 |
New Century Balanced Portfolio | ||||
Actual | $1,000.00 | $954.60 | 1.41% | $6.95 |
Hypothetical 5% Return (before expenses) | $1,000.00 | $1,018.10 | 1.41% | $7.17 |
New Century International Portfolio | ||||
Actual | $1,000.00 | $929.10 | 1.49% | $7.24 |
Hypothetical 5% Return (before expenses) | $1,000.00 | $1,017.69 | 1.49% | $7.58 |
New Century Alternative Strategies Portfolio | ||||
Actual | $1,000.00 | $953.60 | 1.21% | $5.96 |
Hypothetical 5% Return (before expenses) | $1,000.00 | $1,019.11 | 1.21% | $6.16 |
(a) | Annualized, based on the Portfolio’s most recent one-half year expenses. |
(b) | Expenses are equal to the Portfolios' annualized expense ratio multiplied by the average account value over the period, muliplied by 184/365 (to reflect the one-half year period). |
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NEW CENTURY PORTFOLIOS
TRUSTEES’ APPROVAL OF INVESTMENT
ADVISORY AGREEMENTS (Unaudited)
Weston Financial Group, Inc. (“Weston” and/or “Adviser”) serves as the investment adviser to each Portfolio of New Century. The Investment Company Act of 1940, as amended (the “1940 Act”), provides, in substance, that each Investment Advisory Agreement between a Portfolio and its investment adviser will continue in effect from year to year only if its continuance is approved at least annually by the Board of Trustees, including by a vote of majority of the Trustees who are not “interested persons” of the Trust, as that term is defined in the 1940 Act (the “Independent Trustees”), cast in person at a meeting called for considering such approval.
At a regularly scheduled meeting of the Board of Trustees (the “Board”) of New Century Portfolios (the “Trust” and/or “New Century”) held on September 17, 2015, the Board, including a majority of the Independent Trustees, voted to approve the continuance of each Investment Advisory Agreement (collectively, the “Advisory Agreements”) on behalf of each of the Capital, Balanced, International and Alternative Strategies Portfolios for an additional one-year period through October 31, 2016. In approving the continuance of the Advisory Agreements, the Board, including a majority of the Independent Trustees, determined that the advisory fee structures were fair and reasonable and that continuance of the Advisory Agreements was in the best interests of the Portfolios and their shareholders. The approval of the Advisory Agreements, including the advisory fees proposed in connection with the continuation of agreements, was unanimous and thus included a majority of the Independent Trustees and by a majority of the entire Board.
The Board was assisted in their review of the Advisory Agreements by the Chief Compliance Officer (the “CCO”), who also serves as the President and Chief Executive Officer of the Trust, whom is an interested party as defined by the 1940 Act. The CCO provided to the Board per the Trustees request, the following materials to assist in their review of the Advisory Agreements: (i) a detailed memorandum prepared by Counsel outlining the Trustees fiduciary responsibilities relating to New Century’s corporate/trust doctrines and the 1940 Act to assist in determining whether to continue with the Advisory Agreements; (ii) an expense ratio analysis chart detailing the net and gross expense ratios for each Portfolio (as compared to each Portfolio’s respective Morningstar category and based on various ranges of assets under management); and (iii) expense analysis charts demonstrating fees, expenses and investment performance for each of the Portfolios (as compared to comparable groups of funds and benchmarks as classified by Morningstar for the periods ending June 30, 2014 and June 30, 2015). In their discussion with the CCO, the Board was provided a reasonable basis for the Trustees to conclude that the investment advisory fees proposed in connection with each of the Advisory Agreements were reasonable with respect to the Portfolios.
Counsel to the Independent Trustees noted that the Board has always taken a very thorough approach with respect to the annual renewal process, which is one of the most important duties of the Board. Counsel explained that his firm served as counsel to the Trust and its Independent Trustees. He noted that his firm does not serve as counsel to the Adviser nor the Distributor. Counsel then reviewed the Board’s responsibilities with respect to
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NEW CENTURY PORTFOLIOS
TRUSTEES’ APPROVAL OF INVESTMENT
ADVISORY AGREEMENTS (Unaudited) (Continued)
the renewal of investment advisory and distribution agreements under federal and state law, noting that Section 15(c) of the 1940 Act imposes a duty on all board members to request such information as they believe to be reasonably necessary to evaluate the terms of any investment advisory agreement. He explained that there also is a corresponding duty imposed on the Adviser to provide requested information, and any additional information that the Adviser believes to be reasonably necessary for the Board to evaluate the terms of the Agreements.
Counsel further added that the Board has had years of discussion and counseling with respect to the issues covered, including contemporaneous detailed briefing of trustees on the major cases handed down during recent years. The Board has also received appropriate briefings on recent cases brought by the U.S. Securities and Exchange Commission (the “SEC”) that addressed the SEC’s views on how boards should perform their duties. The Board has devoted significant time and attention not only to the governing laws, but to the facts and circumstances that are relevant to decisions made in accordance with that law.
Counsel then reminded the Board that they were permitted to take into account quantitative and qualitative information furnished to the Board throughout the year at regular Board meetings and Audit Committee meetings, in the required monthly reports from Management, as well as materials prepared specifically in connection with the annual review of the Advisory Agreements. He noted that at the Board’s regular meetings, the Trustees typically received investment performance reports and related financial information concerning the Portfolios, brokerage commissions and execution reports provided by the Adviser, and information provided by the Portfolio Managers and their team of assistants and analysts covering the specific performance of each Portfolio and the investment strategies used in pursuing each Portfolio’s investment objectives, among other reports.
Counsel discussed various factors the Board should consider when reviewing the investment advisory, administration and distribution agreements. He added that the Adviser provides certain administrative services to the Trust pursuant to an Administration Agreement, and that although the Administration Agreement is not technically subject to the provisions of Section 15(c) of the 1940 Act, it is appropriate for the Trustees to employ the same criteria in reviewing the renewal of the Administration Agreement as they do the Advisory Agreements and Distribution Agreement. This would include the Board’s consideration of the benefit to the Adviser by way of compensation it receives from its role as the Administrator of the Trust. Counsel noted that Section 15(c) of the 1940 Act and the rules thereunder required that the investment advisory agreements and the distribution agreement be approved by a majority of the Independent Trustees at an in-person meeting. It was noted for the record that all of the Trustees, including the Independent Trustees, including a majority of the Independent Trustees and a majority of the full Board, were participating in-person at this meeting.
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NEW CENTURY PORTFOLIOS
TRUSTEES’ APPROVAL OF INVESTMENT
ADVISORY AGREEMENTS (Unaudited) (Continued)
Counsel further explained that the Board had previously discussed their fiduciary duties and responsibilities extensively at prior meetings during the year and in prior years, and that through its oversight of the Adviser the Board had demonstrated that it was sensitive to the Portfolios’ expenses. He noted that the Board stays up-to-date on current topics in the industry, such as the Jones v. Harris and the Gallus decisions. He noted that there had been several extended discussions among the Board and Counsel regarding the Jones v. Harris Supreme Court decision that affirmed the Gartenberg standard. He further noted that boards are expected to understand the profitability and the effectiveness of the Adviser and this Board understands the Adviser’s business very well given its long working relationship of over 26 years. He added that the Board has a very effective process in place with the Adviser and is diligent about reviewing the information provided to them monthly by the CCO or quarterly, prior to Board meetings, and presenting their questions at the meetings or pursuing the information by contacting the CCO directly.
The Trustees discussed the advisory fee structure of the Capital, Balanced and International versus the Alternative Strategies investment advisory fee structure which maintains a flat 0.75%. The CCO noted that the when the Alternative Strategies Portfolio was launched in 2002 it was one of the first alternative funds in the marketplace. As such, Management had decided on a competitive fee structure that would be attractive to investment advisors, broker/dealers, and their internal clients. The CCO further explained that the Alternative Strategies Portfolio was designed to be more of a unique type of investment with a lower fee structure to attract institutional business, whereas and the Capital, Balanced and International Portfolios were not initially designed to be utilized by institutions, although they could be a suitable option. The CCO noted that when Management proposed and the Board voted to reduce the breakpoint for the Balanced Portfolio effective May 1, 2014, from 1.00% on the first $100 million to 1.00% on the first $50 million and 0.75% thereafter, they had also compared the Capital and International Portfolios to determine whether a shift in the breakpoints was appropriate. Management agreed to revisit the breakpoints for the Capital and International Portfolios at a later date. She explained that the primary driver for reducing the Balanced Portfolio’s breakpoints was due to the makeup of the Portfolio having a substantial portion invested in fixed income funds, which are typically lower cost investments.
The CCO then discussed the nature, extent and quality of the materials provided to the Board for each meeting and additional materials such as the compliance memorandums provided on a more frequent basis. She explained that Management continuously seeks to improve the type and quality of the materials provided to the Board so the Board can make reasonable and sound decisions with respect to any matters requiring their review and approval. If the Adviser is interested in investing in new products, the CCO provides the Board with detailed information so the Board can determine whether to permit the new investment vehicle, or with the purchase of the new Cybersecurity policy, the CCO provided the Board with additional materials that led them to determine that it was appropriate to purchase a cybersecurity policy for the Trust.
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NEW CENTURY PORTFOLIOS
TRUSTEES’ APPROVAL OF INVESTMENT
ADVISORY AGREEMENTS (Unaudited) (Continued)
The Board expressed their satisfaction with the thorough and timely materials they receive from the Adviser as well as the form of communication and amount of communication that transpires between the Board and the Adviser. In addition, the Independent Trustees noted that they were extremely pleased with the quality of services provided by all the service providers as well as the relationship that the Advisor has with all of the service providers.
The CCO added that the Adviser continues to take steps to demonstrate its commitment to the Trust and its shareholders. The CCO further explained that the Adviser takes its responsibilities seriously and strives to provide quality materials to the Board and provide the Board with opportunities to discuss the Portfolios and their performance with the Portfolio Managers. The Board discussed the importance of continuity with regard to the relationship between the Trust and the Board, the Adviser and the Distributor. The CCO noted the value of Weston’s long-term relationship with the Portfolios and reported on the many functions that the Adviser’s Compliance staff performs for the Portfolios. The Adviser further discussed its commitment to enhancing and growing the Portfolios and servicing its shareholders. The Board discussed the cohesiveness of the Portfolio Management team for each of the Portfolios with Messrs. Solomon, Sugameli and LeFavor. The CCO specifically noted that (i) Mr. Solomon dedicates his time to actively managing the Portfolios, including research, operational, and the marketing component to outside Platforms to grow the Portfolios; (ii) there is an enhanced research process including leveraging the time of the financial associates as research analysts as additional resources for the Portfolios; and (iii) the Adviser’s upgrade of Tamarac’s Advisor View portfolio management system, which shows the Advisor is investing in the technology which is available to the Portfolio Managers that will assist them in working more effectively, efficiently, and productively.
The Trustees next reviewed and discussed the background, qualifications, education and experience of the Adviser’s investment professionals and support personnel who provide portfolio management, investment research, and similar services to the Portfolios. In addition, the Trustees discussed the additional research and services that are available to the Portfolios because of the relationship with the Adviser and the Adviser having $2 billion in assets under management amongst a number of platforms. The Board also stated that a long-term relationship with a capable, conscientious Adviser and its personnel is in the best interest of shareholders and such shareholders have benefited from such continuity of advice and from Weston’s strong commitment to compliance. The Board noted its satisfaction with dedication and hard work of the Adviser’s personnel. The Trustees also discussed and considered the quality of shareholder communications, administrative duties, and other services provided by the Adviser to the Trust, the Adviser’s robust compliance program, and the Adviser’s role in coordinating such services and programs for the Trust. The Trustees specifically noted that Management has been exceptionally responsive to any issues raised by the Board and that the Trustees are satisfied with Management’s responses to the Trustees’ inquiries and with their willingness to follow up on matters. The Trustees also expressed their pleasure with
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NEW CENTURY PORTFOLIOS
TRUSTEES’ APPROVAL OF INVESTMENT
ADVISORY AGREEMENTS (Unaudited) (Continued)
the strong relationship that has developed between the Board and the Trust’s CCO over the past thirteen years. The Trustees also took into consideration the belief that the Adviser is a quality firm with a reputation for high moral integrity and honesty.
Next, the Portfolio Manager, in conjunction with the CCO, reviewed the Expense Ratio and Annual Fee Comparison Charts that were provided in the materials as of June 30, 2015. The CCO explained that the Expense Ratio Chart shows the average fund expenses on a cap-weighted basis. The Portfolio Manager discussed the difficulty in finding comparable fund-of-funds, explaining that many fund-of-funds hold inter-family funds, whereas New Century is purchasing and selling funds that have their own expense ratios. The Portfolio Manager discussed the expense ratios of the Portfolios, noting that they have been consistent as compared to other funds of similar size, investment objectives and Morningstar Category classification. The CCO noted that these charts are important for the Trustees to review and discuss the different layer of expenses for each of the Portfolios that the Adviser or the Trust is charging.
The Board then reviewed the contractual investment advisory fee rates, including administrative fee and distribution fee rates, and considered each of the Portfolios’ investment advisory fees and total expense ratios individually and in comparison to a group of similarly managed funds with similar investment styles, investment objectives and asset sizes as classified by Morningstar. The Portfolio Manager reviewed each of the Capital, Balanced, International, and Alternative Strategies Portfolios net and gross expense ratios in comparison to a subset of fund-of-fund mutual funds with similar characteristics to the Portfolios as of June 30, 2015.
The CCO then discussed the Adviser’s Operating Expense Agreement (the “Agreement”) with the Portfolios. Pursuant to this Agreement, the Adviser has agreed to reduce fees and/or reimburse certain other expenses so that the ratio of total operating expenses of each Portfolio is limited to 1.50% of such Portfolio’s average net assets. Further, the Board was reminded that in January 2015 the Adviser agreed to extend the current Operating Expense Agreement through March 1, 2016 and to review each January thereafter. The Board was informed that Portfolios operate under this Agreement, however the Portfolios’ expenses are currently below the level that would trigger the use of such Agreement at this time.
The Board then discussed the Portfolios’ performance, noting that the Portfolios continue to improve even through the current market turbulence. The Portfolio Managers reported that the Portfolios’ have been performing competitively in the industry, with Capital and International in the top half of their category, and that the Portfolios’ returns, as well as their Morningstar ratings, have been satisfactory. They discussed the Portfolios’ fund-of-funds structure noting that investing in a fund-of-funds is a benefit to shareholders and they need to market the Portfolios and their message of the value of a fund-of-funds product in order to grow the assets in the Portfolios. If they can increase assets and can keep expenses low the Trust will be able to reduce fees and benefit the shareholders in the long run. The Board
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NEW CENTURY PORTFOLIOS
TRUSTEES’ APPROVAL OF INVESTMENT
ADVISORY AGREEMENTS (Unaudited) (Continued)
discussed the ways they are looking to market the funds including revamping the website and the product sheets and creating a cost-effective marketing piece that would describe each of the Portfolios, list the value proposition of a fund-of-funds approach, and focus on the story of the Portfolios by illustrating their beneficial differences, especially during volatile markets. The Board expressed its satisfaction with the experience of the Portfolio Managers and the steps the Adviser and Portfolio Managers are taking to improve the performance and grow the Portfolios’ assets. Further, the Board discussed that many funds-of-funds in the industry have the ability to select intra-family funds and therefore are able keep their expense ratios lower, and with this taken into consideration the Portfolios perform competitively.
The Board next considered whether economies of scale are realized by the Adviser and its affiliates as the Portfolios’ assets increase and the extent to which this is reflected in the level of management fees charged. To support such analysis, the Board reviewed the Portfolios’ gross and net expense ratios and expense caps and noted that certain Portfolio expenses are relatively fixed and unrelated to asset size. The Board confirmed that the Adviser may enjoy some economies of scale as a Portfolio’s assets grow but that these economies of scale are currently being shared equitably by the Adviser, its affiliates, and the Portfolios for the benefit of shareholders. The Board also considered the extent of profits realized by the Adviser and its affiliates in providing investment advisory and administrative services to the Portfolios. The Board considered the fact that the Adviser and its affiliates received other compensation from its relationship with the Trust, such as administration fees for being fund administrator and distribution fees pursuant to a Rule 12b-1 plan. The Board concluded that, in light of the foregoing factors and the nature, extent and quality of the services rendered, the profits realized by the Adviser and its affiliates are reasonable.
In its discussions, the Board noted but did not rely upon comparisons of the services to be rendered and the amounts to be paid under the contract with those of other investment advisory contracts, such as contracts of the same or other investment advisers with other registered investment companies or other types of clients (i.e. pension funds and other institutional investors). These factors were considered not to be as significant in a situation where the Independent Trustees were determining whether to re-approve the Advisory Agreements containing the same terms and conditions with an existing entity.
The Board then considered the continuance of its service agreements. The Board considered the renewal of the investment advisory agreements and administration agreement between Weston and the Trust, on behalf of each of the Portfolios. In this regard, the Trustees noted that Weston was proposing that the operating expense limitation agreement currently in place with respect to each of the Portfolios be extended for a comparable one year period. The Board also considered the distribution agreement between the Distributor and the Trust on behalf of each Portfolio. Ms. Tremblay added that with respect to the approval of the Administration Agreement, the Adviser provides all of the back office services for the Portfolios which includes such responsibilities as (i) the Compliance staff handles the twenty
53
NEW CENTURY PORTFOLIOS
TRUSTEES’ APPROVAL OF INVESTMENT
ADVISORY AGREEMENTS (Unaudited) (Continued)
six required SEC filings for the Trust as well as performing other required monthly testing; and (ii) the Adviser’s Investment Department facilitates the Portfolio Managers’ trading activities for the Portfolios including daily reconciliations.
Therefore, the Board approved the renewal of the Advisory Agreements for a one-year period commencing November 1, 2015. The Board based its approval upon its evaluation of: (i) the nature, extent and quality of the services provided by the Adviser; (ii) the Adviser’s commitment to compliance and the policies and procedures maintained to monitor such compliance; (iii) the investment performance of the Portfolios and the effect of recent market and economic turmoil on the performance, asset levels and expense ratios of each Portfolio; (iv) the costs of the services provided and the profits realized by the Adviser from its relationship with the Portfolios; (v) the extent to which economies of scale may be realized as the Portfolios’ assets grow; and, (vi) whether fee levels reflect any such economies of scales for the benefit of the Portfolios’ shareholders. Further, the Trustees believed the proposed Advisory Agreements would provide a continuity of relationship for the Portfolios that the Board felt was a significant factor to be considered. In evaluating the various factors noted above, each Independent Trustee weighed each factor, relative to one-another, as he saw fit, and each Independent Trustee may have allocated different weight to each such factor.
After considering all of the information described above, and in light of the totality of circumstances including the nature, extent and quality of the services provided by the Adviser, the Board concluded with respect to each Portfolio that the investment advisory fees, as well as the Portfolios’ total expense ratios, were both fair and reasonable. In doing so, they noted that they had considered the other relationships between the Trust and the Adviser, and the benefits the Adviser receives from its relationship with the Portfolios. Further, the Board noted the total expense ratios of the Portfolios appear to be fair and reasonable with respect to other funds in the industry that share similar investment strategies. The Trustees also noted that the breakpoints and expense limitation agreements, as applicable, demonstrated Weston’s strong commitment to the Trust and its shareholders.
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INVESTMENT ADVISER AND ADMINISTRATOR Weston Financial Group, Inc. Wellesley, MA
DISTRIBUTOR Weston Securities Corporation Wellesley, MA
COUNSEL Greenberg Traurig, LLP Philadelphia, PA
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM BBD, LLP Philadelphia, PA
TRANSFER AGENT Ultimus Fund Solutions, LLC Cincinnati, OH
CUSTODIAN US Bank, N.A. Cincinnati, OH
This report and the financial statements contained herein are submitted for the general information of the shareholders of the Portfolios. This report is authorized for distribution to prospective investors in the Portfolios only if preceded or accompanied by an effective Prospectus which contains details concerning the management fees, expenses and other pertinent information.
A description of the policies and procedures that the Portfolios use to determine how to vote proxies relating to portfolio securities is available without charge upon request by calling toll-free 1-888-639-0102, or on the SEC’s website at http://www.sec.gov. Information regarding how the Portfolios voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available without charge upon request by calling toll-free 1-888-639-0102, or on the SEC’s website at http://www.sec.gov.
The Portfolios file a complete listing of portfolio holdings with the SEC as of the end of the first and third quarters of each fiscal year on Form N-Q. The Portfolios’ Forms N-Q are available without charge upon request by calling 1-888-639-0102, or on the SEC’s website at http://www.sec.gov. The Portfolios’ Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC, or by calling 1-800-SEC-0330.
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Item 2. | Code of Ethics. |
Item 3. | Audit Committee Financial Expert. |
Item 4. | Principal Accountant Fees and Services. |
(a) | Audit Fees. The aggregate fees billed for professional services rendered by the principal accountant for the audit of the registrant's annual financial statements or for services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements were $50,400 and $50,000 with respect to the registrant's fiscal years ended October 31, 2015 and 2014, respectively. |
(b) | Audit-Related Fees. No fees were billed in either of the last two fiscal years for assurance and related services by the principal accountant that are reasonably related to the performance of the audit of the registrant’s financial statements and are not reported under paragraph (a) of this Item. |
(c) | Tax Fees. The aggregate fees billed for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning were $8,800 and $8,400 with respect to the registrant's fiscal years ended October 31, 2015 and 2014, respectively. The services comprising these fees are the preparation of the registrant's federal income and excise tax returns. |
(d) | All Other Fees. No fees were billed in either of the last two fiscal years for products and services provided by the principal accountant, other than the services reported in paragraphs (a) through (c) of this Item. |
(e)(1) | The audit committee has not adopted pre-approval policies and procedures described in paragraph (c)(7) of Rule 2-01 of Regulation S-X. |
(e)(2) | None of the services described in paragraph (b) through (d) of this Item were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X. |
(f) | Less than 50% of hours expended on the principal accountant’s engagement to audit the registrant’s financial statements for the most recent fiscal year were attributed to work performed by persons other than the principal accountant’s full-time, permanent employees. |
(g) | During the fiscal years ended October 31, 2015 and 2014, aggregate non-audit fees of $8,800 and $8,400, respectively, were billed by the registrant's accountant for services rendered to the registrant. No non-audit fees were billed in either of the last two fiscal years by the registrant's accountant for services rendered to the registrant's investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant. |
(h) | The principal accountant has not provided any non-audit services that were not previously approved to the registrant’s investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant. |
Item 5. | Audit Committee of Listed Registrants. |
Item 6. | Schedule of Investments. |
(a) | Not applicable [schedule filed with Item 1] |
(b) | Not applicable |
Item 7. | Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. |
Item 8. | Portfolio Managers of Closed-End Management Investment Companies. |
Item 9. | Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. |
Item 10. | Submission of Matters to a Vote of Security Holders. |
Item 11. | Controls and Procedures. |
Item 12. | Exhibits. |
Exhibit 99.CODE ETH | Code of Ethics |
Exhibit 99.CERT | Certifications required by Rule 30a-2(a) under the Act |
Exhibit 99.906CERT | Certifications required by Rule 30a-2(b) under the Act |
(Registrant) | New Century Portfolios | ||
By (Signature and Title)* | /s/ Nicole M. Tremblay | ||
Nicole M. Tremblay, President | |||
Date | January 7, 2016 | ||
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. | |||
By (Signature and Title)* | /s/ Nicole M. Tremblay | ||
Nicole M. Tremblay, President | |||
Date | January 7, 2016 | ||
By (Signature and Title)* | /s/ Stephen G. DaCosta | ||
Stephen G. DaCosta, Treasurer and Principal Financial Officer | |||
Date | January 7, 2016 |
* | Print the name and title of each signing officer under his or her signature. |