Notes to financial statements
unaudited
Capital World Growth and Income Fund, Inc. (the "fund") is registered under the Investment Company Act of 1940 as an open-end, diversified management investment company. The fund seeks long-term growth of capital while providing current income. It invests on a global basis in a diversified portfolio consisting primarily of common stocks and other equity securities.
The fund has 16 share classes consisting of five retail share classes, five 529 college savings plan share classes and six retirement plan share classes. The 529 college savings plan share classes (529-A, 529-B, 529-C, 529-E and 529-F-1) can be used to save for college education. The six retirement plan share classes (R-1, R-2, R-3, R-4, R-5 and R-6) are generally offered only through eligible employer-sponsored retirement plans. The fund’s share classes are described below:
| Share class | Initial sales charge | Contingent deferred sales charge upon redemption | Conversion feature |
| Classes A and 529-A | Up to 5.75% | None (except 1% for certain redemptions within one year of purchase without an initial sales charge) | None |
| Classes B and 529-B* | None | Declines from 5% to 0% for redemptions within six years of purchase | Classes B and 529-B convert to Classes A and 529-A, respectively, after eight years |
| Class C | None | 1% for redemptions within one year of purchase | Class C converts to Class F-1 after 10 years |
| Class 529-C | None | 1% for redemptions within one year of purchase | None |
| Class 529-E | None | None | None |
| Classes F-1, F-2 and 529-F-1 | None | None | None |
| Classes R-1, R-2, R-3, R-4, R-5 and R-6 | None | None | None |
*Class B and 529-B shares of the fund are not available for purchase.
Holders of all share classes have equal pro rata rights to assets, dividends and liquidation proceeds. Each share class has identical voting rights, except for the exclusive right to vote on matters affecting only its class. Share classes have different fees and expenses ("class-specific fees and expenses"), primarily due to different arrangements for distribution, administrative and shareholder services. Differences in class-specific fees and expenses will result in differences in net investment income and, therefore, the payment of different per-share dividends by each class.
| 2. | Significant accounting policies |
The financial statements have been prepared to comply with accounting principles generally accepted in the United States of America. These principles require management to make estimates and assumptions that affect reported amounts and disclosures. Actual results could differ from those estimates. The fund follows the significant accounting policies described below, as well as the valuation policies described in the next section on valuation.
Security transactions and related investment income – Security transactions are recorded by the fund as of the date the trades are executed with brokers. Realized gains and losses from security transactions are determined based on the specific identified cost of the securities. In the event a security is purchased with a delayed payment date, the fund will segregate liquid assets sufficient to meet its payment obligations. Dividend income is recognized on the ex-dividend date and interest income is recognized on an accrual basis. Market discounts, premiums and original issue discounts on fixed-income securities are amortized daily over the expected life of the security.
Class allocations – Income, fees and expenses (other than class-specific fees and expenses) and realized and unrealized gains and losses are allocated daily among the various share classes based on their relative net assets. Class-specific fees and expenses, such as distribution, administrative and shareholder services, are charged directly to the respective share class.
Dividends and distributions to shareholders – Dividends and distributions paid to shareholders are recorded on the ex-dividend date.
Currency translation – Assets and liabilities, including investment securities, denominated in currencies other than U.S. dollars are translated into U.S. dollars at the exchange rates in effect on the valuation date. Purchases and sales of investment securities and income and expenses are translated into U.S. dollars at the exchange rates on the dates of such transactions. On the accompanying financial statements, the effects of changes in exchange rates on investment securities are included with the net realized gain or loss and net unrealized appreciation or depreciation on investments. The realized gain or loss and unrealized appreciation or depreciation resulting from all other transactions denominated in currencies other than U.S. dollars are disclosed separately.
The fund’s investments are reported at fair value as defined by accounting principles generally accepted in the United States of America. The fund generally determines its net asset value as of approximately 4:00 p.m. New York time each day the New York Stock Exchange is open.
Methods and inputs – The fund uses the following methods and inputs to establish the fair value of its assets and liabilities. Use of particular methods and inputs may vary over time based on availability and relevance as market and economic conditions evolve.
Equity securities are generally valued at the official closing price of, or the last reported sale price on, the exchange or market on which such securities are traded, as of the close of business on the day the securities are being valued or, lacking any sales, at the last available bid price. Prices for each security are taken from the principal exchange or market in which the security trades.
Fixed-income securities, including short-term securities purchased with more than 60 days left to maturity, are generally valued at prices obtained as of approximately 3:00 p.m. New York time from one or more pricing vendors. Vendors value such securities based on one or more of the inputs described in the following table. The table provides examples of inputs that are commonly relevant for valuing particular classes of fixed-income securities in which the fund is authorized to invest. However, these classifications are not exclusive, and any of the inputs may be used to value any other class of fixed-income security.
| Fixed-income class | Examples of standard inputs |
| All | Benchmark yields, transactions, bids, offers, quotations from dealers and trading systems, new issues, spreads and other relationships observed in the markets among comparable securities; and proprietary pricing models such as yield measures calculated using factors such as cash flows, financial or collateral performance and other reference data (collectively referred to as “standard inputs”) |
| Corporate bonds & notes; convertible securities | Standard inputs and underlying equity of the issuer |
| Bonds & notes of governments & government agencies | Standard inputs and interest rate volatilities |
| Mortgage-backed; asset-backed obligations | Standard inputs and cash flows, prepayment information, default rates, delinquency and loss assumptions, collateral characteristics, credit enhancements and specific deal information |
Where the investment adviser deems it appropriate to do so (such as when vendor prices are unavailable or not deemed to be representative), fixed-income securities will be valued in good faith at the mean quoted bid and asked prices that are reasonably and timely available (or bid prices, if asked prices are not available) or at prices for securities of comparable maturity, quality and type.
Securities with both fixed-income and equity characteristics, or equity securities traded principally among fixed-income dealers, are generally valued in the manner described above for either equity or fixed-income securities, depending on which method is deemed most appropriate by the investment adviser. Short-term securities purchased within 60 days to maturity are valued at amortized cost, which approximates fair value. The value of short-term securities originally purchased with maturities greater than 60 days is determined based on an amortized value to par when they reach 60 days or less remaining to maturity.
Securities and other assets for which representative market quotations are not readily available or are considered unreliable by the investment adviser are fair valued as determined in good faith under guidelines adopted by authority of the fund's board of directors. Market quotations may be considered unreliable if events occur that materially affect the value of securities (particularly equity securities trading outside the U.S.) between the close of trading in those securities and the close of regular trading on the New York Stock Exchange. Various inputs may be reviewed in order to make a good faith determination of a security’s fair value. These inputs include, but are not limited to, the type and cost of the security; contractual or legal restrictions on resale of the security; relevant financial or business developments of the issuer; actively traded similar or related securities; conversion or exchange rights on the security; related corporate actions; significant events occurring after the close of trading in the security; and changes in overall market conditions. Fair valuations and valuations of investments that are not actively trading involve judgment and may differ materially from valuations that would have been used had greater market activity occurred.
Classifications - The fund classifies its assets and liabilities into three levels based on the inputs used to value the assets or liabilities. Level 1 values are based on quoted prices in active markets for identical securities. Level 2 values are based on significant observable market inputs, such as quoted prices for similar securities and quoted prices in inactive markets. Level 3 values are based on significant unobservable inputs that reflect the fund’s determination of assumptions that market participants might reasonably use in valuing the securities. The valuation levels are not necessarily an indication of the risk or liquidity associated with the underlying investment. For example, U.S. government securities are refl ected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market. The following table presents the fund’s valuation levels as of May 31, 2010 (dollars in thousands):
| Investment securities: | | Level 1 | | | Level 2 | | | Level 3 | | | Total | |
| Common stocks: | | | | | | | | | | | | |
| Financials | | $ | 9,925,476 | | | $ | 1,426,727 | * | | $ | - | | | $ | 11,352,203 | |
| Information technology | | | 9,046,773 | | | | - | | | | - | | | | 9,046,773 | |
| Industrials | | | 6,961,285 | | | | 240,802 | * | | | - | | | | 7,202,087 | |
| Consumer staples | | | 6,370,072 | | | | 525,064 | * | | | - | | | | 6,895,136 | |
| Telecommunication services | | | 6,311,436 | | | | 285,217 | * | | | - | | | | 6,596,653 | |
| Consumer discretionary | | | 5,102,297 | | | | 626,958 | * | | | - | | | | 5,729,255 | |
| Health care | | | 5,633,847 | | | | - | | | | - | | | | 5,633,847 | |
| Energy | | | 3,701,407 | | | | 1,476,695 | * | | | - | | | | 5,178,102 | |
| Utilities | | | 3,422,802 | | | | 523,832 | * | | | - | | | | 3,946,634 | |
| Materials | | | 2,758,323 | | | | - | | | | - | | | | 2,758,323 | |
| Miscellaneous | | | 2,518,605 | | | | 274,169 | * | | | - | | | | 2,792,774 | |
| Preferred stocks | | | - | | | | 241,670 | | | | - | | | | 241,670 | |
| Convertible securities | | | 252,793 | | | | 184,768 | | | | - | | | | 437,561 | |
| Bonds & notes | | | - | | | | 943,702 | | | | - | | | | 943,702 | |
| Short-term securities | | | - | | | | 2,317,613 | | | | - | | | | 2,317,613 | |
| Total | | $ | 62,005,116 | | | $ | 9,067,217 | | | $ | - | | | $ | 71,072,333 | |
| | | | | | | | | | | | | | | | | |
| (*) Includes certain securities trading outside the U.S. whose values were adjusted as a result of significant market movements following the close of local trading; therefore, $4,660,065,000 of investment securities were classified as Level 2 instead of Level 1. | |
Investing in the fund may involve certain risks including, but not limited to, those described below.
The fund is subject to risks, including the possibility that the fund's income and the value of its portfolio holdings may fluctuate in response to events specific to the companies or markets in which the fund invests, as well as economic, political or social events in the U.S. or abroad.
The prices of, and the income generated by, the common stocks and other securities held by the fund may decline in response to certain events taking place around the world, including those directly involving the issuers whose securities are owned by the fund; conditions affecting the general economy; overall market changes; local, regional or global political, social or economic instability; governmental or governmental agency responses to economic conditions; and currency, interest rate and commodity price fluctuations. Investments in securities issued by entities based outside the U.S. may be subject to the risks described above to a greater extent. These investments may also be affected by currency controls; different accounting, auditing, financial reporting, disclosure and regulatory and legal standards and practices; expropriation; changes in tax policy; greater market volatility; different securities market structures; higher transaction costs; and various administrative difficulties, such as delays in clearing and settling portfolio transactions or in receiving payment of dividends. These risks may be heightened in connection with investments in developing countries. Investments in securities issued by entities domiciled in the U.S. may also be subject to many of these risks.
5. Taxation and distributions
Federal income taxation – The fund complies with the requirements under Subchapter M of the Internal Revenue Code applicable to mutual funds and intends to distribute substantially all of its net taxable income and net capital gains each year. The fund is not subject to income taxes to the extent such distributions are made. Therefore, no federal income tax provision is required.
As of and during the period ended May 31, 2010, the fund did not have a liability for any unrecognized tax benefits. The fund recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the statement of operations. During the period, the fund did not incur any interest or penalties.
The fund is not subject to examination by U.S. federal tax authorities for tax years before 2005, by state tax authorities for tax years before 2004 and by tax authorities outside the U.S. for tax years before 2003.
Non-U.S. taxation – Dividend and interest income is recorded net of non-U.S. taxes paid. Gains realized by the fund on the sale of securities in certain countries are subject to non-U.S. taxes. The fund records a liability based on unrealized gains to provide for potential non-U.S. taxes payable upon the sale of these securities.
Distributions – Distributions paid to shareholders are based on net investment income and net realized gains determined on a tax basis, which may differ from net investment income and net realized gains for financial reporting purposes. These differences are due primarily to different treatment for items such as currency gains and losses; short-term capital gains and losses; capital losses related to sales of certain securities within 30 days of purchase; unrealized appreciation of certain investments in securities outside the U.S.; net capital losses; and income on certain investments. The fiscal year in which amounts are distributed may differ from the year in which the net investment income and net realized gains are recorde d by the fund for financial reporting purposes.
The components of distributable earnings on a tax basis are reported as of the fund’s most recent year-end. As of November 30, 2009, the components of distributable earnings on a tax basis were as follows:
| | | (dollars in thousands) | |
| Undistributed ordinary income | | | | | $ | 794,862 | |
| Capital loss carryforwards*: | | | | | | | |
| Expiring 2016 | | $ | (2,728,750 | ) | | | | |
| Expiring 2017 | | | (13,178,426 | ) | | | (15,907,176 | ) |
Post-October capital loss deferrals (realized during the period November 1, 2009, through November 30, 2009)† | | | | | | | (362,906 | ) |
| | |
| *The capital loss carryforwards will be used to offset any capital gains realized by the fund in the current year or in subsequent years through the expiration dates. The fund will not make distributions from capital gains while capital loss carryforwards remain. | |
| †These deferrals are considered incurred in the subsequent year. | | | | | | | | |
As of May 31, 2010, the tax basis unrealized appreciation (depreciation) and cost of investment securities were as follows:
| | (dollars in thousands) | |
| Gross unrealized appreciation on investment securities | | $ | 7,616,029 | |
| Gross unrealized depreciation on investment securities | | | (7,353,936 | ) |
| Net unrealized appreciation on investment securities | | | 262,093 | |
| Cost of investment securities | | | 70,810,240 | |
Ordinary income distributions paid to shareholders from net investment income were as follows (dollars in thousands):
| Share class | | Six months ended May 31, 2010 | | | Year ended November 30, 2009 | |
| Class A | | $ | 544,325 | | | $ | 1,709,423 | |
| Class B | | | 17,366 | | | | 76,151 | |
| Class C | | | 37,466 | | | | 158,321 | |
| Class F-1 | | | 41,041 | | | | 130,498 | |
| Class F-2 | | | 13,539 | | | | 20,416 | |
| Class 529-A | | | 17,595 | | | | 49,808 | |
| Class 529-B | | | 1,035 | | | | 4,336 | |
| Class 529-C | | | 2,831 | | | | 10,753 | |
| Class 529-E | | | 669 | | | | 2,049 | |
| Class 529-F-1 | | | 530 | | | | 1,373 | |
| Class R-1 | | | 1,418 | | | | 4,509 | |
| Class R-2 | | | 7,614 | | | | 27,566 | |
| Class R-3 | | | 18,675 | | | | 55,202 | |
| Class R-4 | | | 18,401 | | | | 49,554 | |
| Class R-5 | | | 18,238 | | | | 55,468 | |
| Class R-6* | | | 6,770 | | | | 6,858 | |
| Total | | $ | 747,513 | | | $ | 2,362,285 | |
| | | | | | | | | |
| *Class R-6 was offered beginning May 1, 2009. | | | | | |
6. Fees and transactions with related parties
Capital Research and Management Company ("CRMC"), the fund’s investment adviser, is the parent company of American Funds Distributors,® Inc. ("AFD"), the principal underwriter of the fund’s shares, and American Funds Service Company® ("AFS"), the fund’s transfer agent.
Investment advisory services - The Investment Advisory and Service Agreement with CRMC provides for monthly fees accrued daily. These fees are based on a series of decreasing annual rates beginning with 0.600% on the first $500 million of daily net assets and decreasing to 0.350% on such assets in excess of $115 billion. For the six months ended May 31, 2010, the investment advisory services fee was $149,694,000, which was equivalent to an annualized rate of 0.376% of average daily net assets.
Class-specific fees and expenses – Expenses that are specific to individual share classes are accrued directly to the respective share class. The principal class-specific fees and expenses are described below:
Distribution services – The fund has adopted plans of distribution for all share classes, except Classes F-2, R-5 and R-6. Under the plans, the board of directors approves certain categories of expenses that are used to finance activities primarily intended to sell fund shares and service existing accounts. The plans provide for payments, based on an annualized percentage of average daily net assets, ranging from 0.30% to 1.00% as noted below. In some cases, the board of directors has limited the amounts that may be paid to less than the maximum allowed by the plans. All share classes with a plan may use up to 0.25% of average daily net assets to pay service fees, or to compensate AFD for paying service fees, to firms that hav e entered into agreements with AFD to provide certain shareholder services. The remaining amounts available to be paid under each plan are paid to dealers to compensate them for their sales activities.
For Classes A and 529-A, the board of directors has also approved the reimbursement of dealer and wholesaler commissions paid by AFD for certain shares sold without a sales charge. These classes reimburse AFD for amounts billed within the prior 15 months but only to the extent that the overall annual expense limit of 0.30% is not exceeded. As of May 31, 2010, there were no unreimbursed expenses subject to reimbursement for Classes A or 529-A.
| Share class | Currently approved limits | Plan limits |
| Class A | 0.30% | 0.30% |
| Class 529-A | 0.30 | 0.50 |
| Classes B and 529-B | 1.00 | 1.00 |
| Classes C, 529-C and R-1 | 1.00 | 1.00 |
| Class R-2 | 0.75 | 1.00 |
| Classes 529-E and R-3 | 0.50 | 0.75 |
| Classes F-1, 529-F-1 and R-4 | 0.25 | 0.50 |
Transfer agent services – The fund has a transfer agent agreement with AFS for Classes A and B. Under this agreement, these share classes compensate AFS for transfer agent services including shareholder recordkeeping, communications and transaction processing. AFS is also compensated for certain transfer agent services provided to all other share classes from the administrative services fees paid to CRMC as described below.
Administrative services – The fund has an administrative services agreement with CRMC for all share classes, except Classes A and B, to provide certain services, including transfer agent and record keeping services; coordinating, monitoring, assisting and overseeing third-party service providers; and educating advisers and shareholders about the impact of market-related events, tax laws affecting investments, retirement plan restrictions, exchange limitations, and other related matters. Each relevant share class pays CRMC annual fees up to 0.15% (0.10% for Class R-5 and 0.05% for Class R-6) based on its respective average daily net assets. Each relevant share class also pays AFS additional amounts for certain transfer agent services. CRMC and AFS may use these fees to compensate third p arties for performing these services. Each 529 share class is subject to an additional administrative services fee payable to the Commonwealth of Virginia for the maintenance of the 529 college savings plan. The quarterly fee is based on a series of decreasing annual rates beginning with 0.10% on the first $30 billion of the net assets invested in Class 529 shares of the American Funds and decreasing to 0.06% on such assets between $120 billion and $150 billion. The fee for any given calendar quarter is accrued and calculated on the basis of the average net assets of Class 529 shares of the American Funds for the last month of the prior calendar quarter. Although these amounts are included with administrative services fees on the accompanying financial statements, the Commonwealth of Virginia is not considered a related party.
Expenses under the agreements described above for the six months ended May 31, 2010, were as follows (dollars in thousands):
| Share class | Distribution services | Transfer agent services | Administrative services |
| CRMC administrative services | Transfer agent services | Commonwealth of Virginia administrative services |
| Class A | $66,113 | $39,906 | Not applicable | Not applicable | Not applicable |
| Class B | 14,161 | 2,112 | Not applicable | Not applicable | Not applicable |
| Class C | 31,331 | Included in administrative services | $4,702 | $796 | Not applicable |
| Class F-1 | 5,063 | 2,548 | 255 | Not applicable |
| Class F-2 | Not applicable | 795 | 39 | Not applicable |
| Class 529-A | 1,966 | 886 | 167 | $916 |
| Class 529-B | 912 | 88 | 32 | 91 |
| Class 529-C | 2,489 | 242 | 75 | 250 |
| Class 529-E | 205 | 40 | 8 | 41 |
| Class 529-F-1 | - | 24 | 5 | 25 |
| Class R-1 | 1,165 | 147 | 30 | Not applicable |
| Class R-2 | 4,725 | 925 | 1,753 | Not applicable |
| Class R-3 | 5,560 | 1,617 | 569 | Not applicable |
| Class R-4 | 2,386 | 1,377 | 41 | Not applicable |
| Class R-5 | Not applicable | 758 | 16 | Not applicable |
| Class R-6 | Not applicable | 161 | 2 | Not applicable |
| Total | $136,076 | $42,018 | $14,310 | $3,788 | $1,323 |
Directors’ deferred compensation – Since the adoption of the deferred compensation plan in 1993, directors who are unaffiliated with CRMC may elect to defer the cash payment of part or all of their compensation. These deferred amounts, which remain as liabilities of the fund, are treated as if invested in shares of the fund or other American Funds. These amounts represent general, unsecured liabilities of the fund and vary according to the total returns of the selected funds. Directors’ compensation of $427,000, shown on the accompanying financial statements, includes $378,000 in current fees (either paid in cash or deferred) and a net increase of $49,000 in the value of the deferred amounts.
Affiliated officers and directors – Officers and certain directors of the fund are or may be considered to be affiliated with CRMC, AFS and AFD. No affiliated officers or directors received any compensation directly from the fund.
7. Capital share transactions
Capital share transactions in the fund were as follows (dollars and shares in thousands):
| Share class | | Sales(*) | | | Reinvestments of dividends and distributions | | | Repurchases(*) | | | Net (decrease) increase | |
| | | Amount | | | Shares | | | Amount | | | Shares | | | Amount | | | Shares | | | Amount | | | Shares | |
| Six months ended May 31, 2010 | | | | | | | | | | | | | | | | | | | | | | |
| Class A | | $ | 3,187,464 | | | | 95,185 | | | $ | 515,602 | | | | 15,197 | | | $ | (5,179,380 | ) | | | (156,873 | ) | | $ | (1,476,314 | ) | | | (46,491 | ) |
| Class B | | | 37,456 | | | | 1,122 | | | | 16,860 | | | | 499 | | | | (323,010 | ) | | | (9,761 | ) | | | (268,694 | ) | | | (8,140 | ) |
| Class C | | | 408,273 | | | | 12,292 | | | | 33,338 | | | | 991 | | | | (648,925 | ) | | | (19,827 | ) | | | (207,314 | ) | | | (6,544 | ) |
| Class F-1 | | | 600,004 | | | | 18,034 | | | | 37,148 | | | | 1,097 | | | | (711,734 | ) | | | (21,644 | ) | | | (74,582 | ) | | | (2,513 | ) |
| Class F-2 | | | 321,009 | | | | 9,613 | | | | 9,379 | | | | 276 | | | | (185,674 | ) | | | (5,662 | ) | | | 144,714 | | | | 4,227 | |
| Class 529-A | | | 184,678 | | | | 5,535 | | | | 17,592 | | | | 519 | | | | (86,824 | ) | | | (2,624 | ) | | | 115,446 | | | | 3,430 | |
| Class 529-B | | | 3,437 | | | | 103 | | | | 1,035 | | | | 31 | | | | (12,388 | ) | | | (373 | ) | | | (7,916 | ) | | | (239 | ) |
| Class 529-C | | | 57,302 | | | | 1,723 | | | | 2,830 | | | | 84 | | | | (30,737 | ) | | | (931 | ) | | | 29,395 | | | | 876 | |
| Class 529-E | | | 8,999 | | | | 270 | | | | 669 | | | | 20 | | | | (5,150 | ) | | | (157 | ) | | | 4,518 | | | | 133 | |
| Class 529-F-1 | | | 8,970 | | | | 269 | | | | 529 | | | | 16 | | | | (4,051 | ) | | | (122 | ) | | | 5,448 | | | | 163 | |
| Class R-1 | | | 55,115 | | | | 1,658 | | | | 1,404 | | | | 42 | | | | (20,597 | ) | | | (626 | ) | | | 35,922 | | | | 1,074 | |
| Class R-2 | | | 194,457 | | | | 5,876 | | | | 7,525 | | | | 224 | | | | (190,717 | ) | | | (5,792 | ) | | | 11,265 | | | | 308 | |
| Class R-3 | | | 420,993 | | | | 12,642 | | | | 18,211 | | | | 539 | | | | (349,418 | ) | | | (10,555 | ) | | | 89,786 | | | | 2,626 | |
| Class R-4 | | | 419,526 | | | | 12,525 | | | | 18,278 | | | | 540 | | | | (278,110 | ) | | | (8,381 | ) | | | 159,694 | | | | 4,684 | |
| Class R-5 | | | 254,572 | | | | 7,647 | | | | 17,992 | | | | 530 | | | | (500,099 | ) | | | (15,120 | ) | | | (227,535 | ) | | | (6,943 | ) |
| Class R-6 | | | 512,742 | | | | 15,463 | | | | 6,769 | | | | 200 | | | | (65,381 | ) | | | (1,941 | ) | | | 454,130 | | | | 13,722 | |
| Total net increase | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (decrease) | | $ | 6,674,997 | | | | 199,957 | | | $ | 705,161 | | | | 20,805 | | | $ | (8,592,195 | ) | | | (260,389 | ) | | $ | (1,212,037 | ) | | | (39,627 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Year ended November 30, 2009 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Class A | | $ | 5,634,311 | | | | 202,086 | | | $ | 1,632,579 | | | | 60,039 | | | $ | (10,857,239 | ) | | | (407,937 | ) | | $ | (3,590,349 | ) | | | (145,812 | ) |
| Class B | | | 146,474 | | | | 5,569 | | | | 73,743 | | | | 2,731 | | | | (572,222 | ) | | | (21,521 | ) | | | (352,005 | ) | | | (13,221 | ) |
| Class C | | | 663,023 | | | | 23,791 | | | | 149,763 | | | | 5,564 | | | | (1,340,195 | ) | | | (51,270 | ) | | | (527,409 | ) | | | (21,915 | ) |
| Class F-1 | | | 1,062,501 | | | | 38,240 | | | | 114,839 | | | | 4,234 | | | | (1,703,989 | ) | | | (63,851 | ) | | | (526,649 | ) | | | (21,377 | ) |
| Class F-2 | | | 983,737 | | | | 34,325 | | | | 13,832 | | | | 487 | | | | (153,120 | ) | | | (5,313 | ) | | | 844,449 | | | | 29,499 | |
| Class 529-A | | | 245,229 | | | | 8,767 | | | | 49,793 | | | | 1,831 | | | | (156,871 | ) | | | (5,846 | ) | | | 138,151 | | | | 4,752 | |
| Class 529-B | | | 11,926 | | | | 462 | | | | 4,336 | | | | 160 | | | | (14,889 | ) | | | (562 | ) | | | 1,373 | | | | 60 | |
| Class 529-C | | | 81,220 | | | | 2,922 | | | | 10,746 | | | | 397 | | | | (58,574 | ) | | | (2,176 | ) | | | 33,392 | | | | 1,143 | |
| Class 529-E | | | 12,904 | | | | 465 | | | | 2,048 | | | | 75 | | | | (8,500 | ) | | | (317 | ) | | | 6,452 | | | | 223 | |
| Class 529-F-1 | | | 11,134 | | | | 397 | | | | 1,373 | | | | 51 | | | | (6,695 | ) | | | (243 | ) | | | 5,812 | | | | 205 | |
| Class R-1 | | | 71,826 | | | | 2,580 | | | | 4,454 | | | | 164 | | | | (31,923 | ) | | | (1,164 | ) | | | 44,357 | | | | 1,580 | |
| Class R-2 | | | 359,598 | | | | 13,225 | | | | 27,535 | | | | 1,019 | | | | (256,621 | ) | | | (9,388 | ) | | | 130,512 | | | | 4,856 | |
| Class R-3 | | | 677,243 | | | | 24,411 | | | | 55,047 | | | | 2,027 | | | | (438,046 | ) | | | (15,794 | ) | | | 294,244 | | | | 10,644 | |
| Class R-4 | | | 618,187 | | | | 22,241 | | | | 49,529 | | | | 1,816 | | | | (418,241 | ) | | | (15,026 | ) | | | 249,475 | | | | 9,031 | |
| Class R-5 | | | 597,447 | | | | 21,560 | | | | 53,891 | | | | 1,991 | | | | (852,656 | ) | | | (31,119 | ) | | | (201,318 | ) | | | (7,568 | ) |
Class R-6(†) | | | 426,564 | | | | 15,423 | | | | 6,858 | | | | 234 | | | | (11,555 | ) | | | (361 | ) | | | 421,867 | | | | 15,296 | |
| Total net increase | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (decrease) | | $ | 11,603,324 | | | | 416,464 | | | $ | 2,250,366 | | | | 82,820 | | | $ | (16,881,336 | ) | | | (631,888 | ) | | $ | (3,027,646 | ) | | | (132,604 | ) |
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(*)Includes exchanges between share classes of the fund. | | | | | | | | | | | | | | | | | | | | | |
(†)Class R-6 was offered beginning May 1, 2009. | | | | | | | | | | | | | | | | | | | | | | | | | |
8. Investment transactions
The fund made purchases and sales of investment securities, excluding short-term securities and U.S. government obligations, if any, of $10,224,425,000 and $10,563,863,000, respectively, during the six months ended May 31, 2010.
