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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number 811-01743
The Alger Funds II
(Exact name of registrant as specified in charter)
360 Park Avenue South New York, New York 10010
(Address of principal executive offices) (Zip code)
Mr. Hal Liebes
Fred Alger Management, Inc.
360 Park Avenue South
New York, New York 10010
(Name and address of agent for service)
Registrant's telephone number, including area code: 212-806-8800
Date of fiscal year end: October 31
Date of reporting period: April 30, 2015
ITEM 1. REPORT(S) TO STOCKHOLDERS.
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Shareholders' Letter April 30, 2015
Dear Shareholders,
Market Rally Continues as Skeptics Cling to Pessimistic View
Pundits for many years have incorrectly opined that equity markets, both in the United States
and abroad, would collapse, even as stocks have continued to generate strong returns. It’s
puzzling that skeptics and critics on almost any topic seem to be positioned as the smarter
or wiser voices in the room. And yet, those who have been skeptical of equity markets have
been wrong in meaningful ways, unlike optimists, including Alger. Indeed, the equity rally
following the market lows of March of 2009 has continued, with the S&P 500 index gaining
4.40% for the six-month reporting period ended April 30 of this year. International equities
also advanced during the reporting period, with the MSCI ACWI ex USA Index gaining
5.80% and the MSCI Emerging Markets Index returning 4.04%.
Market Volatility
In the U.S., investor sentiment was supported by strong corporate fundamentals, merger and
acquisition activity, low interest rates, a strengthening labor market, and expectations that
consumer spending could increase as low oil and gasoline prices reduce Americans’ energy
bills. Yet, markets were volatile during the reporting period, with the S&P 500 producing 12
declines of more than 1%. In comparison, the six-month period ended October 31, 2014,
generated only eight declines of more than 1%.
Early in the reporting period ended April 30, the potential for declining oil prices to crimp
energy producers’ earnings and cause industrial businesses to cut capital expenditures weighed
upon investor sentiment. At other times, investors grew concerned that a combination of
uneven global economic growth and a strong U.S. dollar could curtail America’s exports.
Expectations that the Federal Reserve would raise interest rates this year also weighed upon
investor sentiment. Rather than react quickly to day-by-day changes in investor sentiment, we
remained focused on our research-driven strategy that seeks attractive companies that have
strong potential to grow their earnings. We held to our belief that equities have potential for
generating attractive returns.
Oil Prices Jar Investors
From September of 2013 to the start of the six-month reporting period, the price of West
Texas Intermediate crude (WTI) dropped abruptly from $109.62 to $78.77 a barrel, a result
of growing oil production in U.S. shale reserves, a strengthening U.S. dollar, and moderating
global energy demand. The price decline continued during the reporting period, with WTI
hitting a low of $43.39 in mid-March. At times, the price declines sparked equity selloffs
as investors grew fearful that the adverse impact of cheap oil on energy company profits
could expand to other industries and hinder U.S. economic growth. Concerns over oil
companies, of course, were warranted, with fourth-quarter earnings for the S&P 500 energy
sector declining 22.1%, according to FactSet Research Systems, Inc. At the end of January,
furthermore, first-quarter energy earnings were forecasted to decline 54%, according to
consensus estimates compiled by FactSet. It appears that fears that the impact of cheap oil
would extend to other industries may have been overblown, with first-quarter ex-energy
earnings having grown 6.8% among S&P 500 companies that had reported results by the
end of the reporting period, according to FactSet.
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Rather than quickly sell energy holdings, we assessed if individual companies could mitigate
the impact of low oil prices on earnings by reducing capital expenditures or reducing other
expenses. While we acknowledged that industries that support energy companies could
experience declining revenues as petroleum companies curtail new projects, we continued
to believe that low oil costs could create growth opportunities for consumer companies and
stimulate the U.S. economy. Indeed, savings at the gasoline pump this year could give U.S.
consumers an additional $100 billion to $200 billion in disposable income and also help keep
U.S. food costs down by decreasing trucking expenses, according to Goldman Sachs and
the Wall Street Journal. Low oil prices are also helping energy-intensive industries, such as
airlines, cut fuel expenses and grow earnings. With that in mind, Goldman Sachs estimates
that lower energy costs could increase U.S. economic growth by 0.2% to 0.5% this year.
Global Economic Growth and a Strengthening U.S. Dollar
Investors also anticipated that uneven global economic growth and a strong U.S. dollar
would hurt the earnings of American exporters and U.S. multinational companies. Indeed,
prior to the first-quarter earnings season, analysts estimated that S&P 500 profits would
decline 5.8% because the strongest U.S. dollar in 12 years would hinder exporting. That
concern appeared to be validated when Monsanto Company, FedEx Corp., Oracle Corp.,
Adobe Systems, Inc., and a handful of other corporations that are usually among the first
to report quarterly results said currency had been a major headwind. The World Bank also
played a role in dampening investors’ outlook for U.S. exports when it forecasted that the
global economy will grow only 3% this year compared to its earlier forecast of 3.4%.
At Alger, our fundamental research-driven investment strategy seeks to understand risks,
including the potential for adverse currency exchange rates that may affect our holdings.
Rather than hastily sell equities of U.S. exporters, we continued to monitor portfolio holdings
while assessing if each individual company could take actions, such as cutting expenses, to
help offset the impact of a strong U.S. dollar. As it turns out, investors’ reactions to the
strong U.S. dollar may have been excessive, with S&P 500 first-quarter ex-energy earnings
climbing 6.8% as previously noted.
Weak economic growth abroad, of course, is challenging for U.S. exporters. While the
eurozone economy is showing signs of improving, its growth is expected to limp along at
1.5% for 2015, according to the International Monetary Fund. Russia’s economy, meanwhile,
is struggling with declining revenues from energy exports and sanctions that seek to punish
the country for its annexation of the Crimea section of Ukraine, and the World Bank
expects Russia’s economy to contract 3.8% this year. In the Pacific, the Bank of Japan has
lowered its forecasted annual GDP rate to 2.0% from 2.1%, and in China, a housing slump
and weakening growth of exports has been causing economic growth to moderate. After
having grown 7.4% in 2014, the country’s economy is estimated to have grown only 7% in
the first quarter.
Yet, we maintain that a strong U.S. dollar, while being a headwind in the near term for American
exporters, is likely to stimulate global economic growth by supporting manufacturing
abroad. A strong dollar makes U.S. goods more expensive in the global marketplace, which
gives exporters in countries with weaker currencies a competitive advantage. At the same
time, consumers in foreign countries will be more likely to purchase locally manufactured
goods as currency exchange rates make U.S. products more expensive. Central banks in
many countries, furthermore, are continuing to roll out monetary stimulus. Among other
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measures, the eurozone is in the midst of a 1 trillion euro ($1.12 trillion) quantitative
easing program that involves purchasing securities to pump cash into the economy and
keep interest rates low. The Bank of Japan, for its part, is plowing 80 trillion yen, or the
equivalent of $668 billion, annually into the economy with quantitative easing. Russia, while
falling short of embracing quantitative easing, remains committed to more traditional forms
of monetary stimulus and China continues to take action to support economic growth. It
has published a definitive plan for the One Belt One Road strategy, which among other
initiatives, seeks to encourage trade by improving infrastructure for global transportation.
China has also launched a coordinated agency response to reduce administrative measures
for the housing sector. The People’s Bank of China, meanwhile, has continued working on
interest rate deregulation and it has lowered policy rates.
From a broader perspective, central banks across emerging markets have generally maintained
accommodative policies. We note that emerging markets’ earnings growth is expected to
hover above 12% this year. In addition, the price-to-earnings discount of emerging markets
to developed markets, while narrowing to less than 30% by the end of the reporting period,
is still excessive in our opinion. We believe a 10% to 12% discount is more appropriate.
Growth of foreign countries’ economies, we maintain, will be an important tailwind for U.S.
corporations. For now, however, it is primarily the U.S. that is serving as a driver of global
economic growth.
Federal Reserve Policies
With the Federal Reserve having concluded its asset purchase program, investors have
been anticipating when the central bank will increase the Fed Funds rate from the current
record low target which is now 0% to 0.25%. Fed officials have emphasized that they will
patiently wait for the economy to be strong enough to withstand a rate increase. Despite
those comments, investors continued to grow cautious and sold U.S. equities when favorable
economic data validated fears that a rate hike was approaching. At Alger, our research-driven
strategy seeks to understand how our portfolio holdings manage risk, including interest
rates. Strong companies with healthy balance sheets and potential to grow their earnings, we
maintain, may be less susceptible to the adverse impacts of higher interest rates, including
increased financing costs. Interest rate increases, furthermore, are likely to be moderate.
With low interest rates in many countries and widening spreads between foreign and U.S.
bonds, investors abroad who are seeking income-producing securities are likely to turn to
America’s fixed-income market. We believe that the flow of assets to U.S. fixed-income
securities is likely to support bond prices and keep interest rates down.
Economic Growth
Investors also reacted to the uneven growth of the U.S. economy. According to preliminary
data, the country’s economy grew at a disappointing 0.2% annualized-growth rate during the
first quarter of this year compared to the 2.2% rate for the last three months of 2014. In
reacting to the news, the Federal Reserve maintained that “transitory factors” were partially
to blame. Indeed, severe winter weather, a strong U.S. dollar, declining oil prices, and labor
issues at West Coast ports are believed to have hurt economic growth. We maintain that the
economic recovery is stronger than commonly believed. So far, shoppers appear to have
had a subdued reaction to lower gasoline prices, with retail spending increasing only 1.9% in
the first quarter. Going forward, a combination of low gasoline prices and a strengthening
labor market is likely to support shoppers’ willingness to spend, which is significant since
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consumer spending represents roughly 70% of U.S. GDP. We are encouraged to have seen
seasonally adjusted unemployment decline from a Great Recession high of 10% to 5.5% as
of February and March, and first quarter wages and salaries increase 0.7% after increasing
0.6% in the fourth quarter.
Reasons for Optimism
We believe that a strengthening U.S. economy will continue to provide fertile ground for
corporations to grow their earnings and that merger and acquisition activity, shareholder
activism, and strong corporate fundamentals are likely to support equities during the
foreseeable future. In the aftermath of the subprime mortgage crisis, U.S. corporations have
been disciplined with their spending as they continue to grow their earnings. As a result,
cash levels held in the U.S. by nonfinancial companies totaled $1.73 trillion at the end of
2014, a 117% increase from 2007, according to estimates from Moody’s and MarketWatch.
With large cash balances, corporations are completing mergers and acquisitions at a rapid
pace. After declining to $78.8 billion as of January, deal volume increased to $190.4 billion
as of March, according to FactSet Research Systems. In addition to supporting valuations,
mergers and acquisitions can potentially help companies grow their earnings by expanding
the lineup of products and services that can be distributed with existing sales networks.
It is our belief that shareholder activism is also a significant factor that will continue to
support equity valuations. Activists force companies to be efficient with operations and
capital, which puts executives under increased pressure to perform and make decisions that
benefit shareholders. Activists have targeted some of the biggest companies, such as Procter
& Gamble Co., Apple, Inc., PepsiCo, Inc., Microsoft Corp., and eBay, Inc. and are likely to
ramp up their efforts—at the end of 2014, activist funds held about $120 billion in assets,
up 269% over the past five years, according to Corporate Compliance Insights.
With strong corporate fundamentals, meanwhile, businesses are providing additional
support to their stock valuations by returning cash to investors through dividends and stock
buybacks. In the first quarter, dividend net increases (or dividend increases minus decreases)
increased $12.6 billion, according to S&P Dow Jones Indices. The growth rate trailed the
$17.9 billion increase during the first quarter of 2014, but S&P Dow Jones Indices still
expects dividend payments to set a new record this year. Stock buybacks are also continuing
at a record pace. In April, U.S. companies announced $141 billion in authorized stock
buyback programs, which was the highest monthly number ever recorded and a 121% year-
over-year increase, according to Birinyi Associates.
Going Forward
We believe that equities, over time, are likely to generate attractive returns, although market
volatility will continue. We maintain that investment managers who use research-driven
strategies can potentially find leading businesses that are well prepared to benefit from large-
scale global trends, such as the rising value of the U.S. dollar, rapidly declining oil prices,
quantitative easing abroad, and other forms of monetary stimulus. At the same time, trends
within industries, such as medical breakthroughs, the rising use of the Internet, and growing
demand for residential and industrial real estate, are creating new opportunities for leading
businesses to grow their earnings. With that in mind, we will remain committed to using our
research-driven investment strategy to produce attractive returns for our clients.
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Portfolio Matters
Alger Spectra Fund
The Alger Spectra Fund returned 7.46% for the six-month period ended April 30, 2015,
compared to the 6.59% return of the Russell 3000 Growth Index.
During the period, the largest sector weightings were Information Technology and Health
Care. The largest sector overweight was Health Care and the largest sector underweight was
Consumer Staples. Financials, Health Care, and Information Technology sectors provided
the largest contributions to relative performance, while Consumer Staples detracted from
results.
For the reporting period, the Fund’s average portfolio allocation to long positions, which
was increased by leverage, was 101.48% of assets. In aggregate, long positions contributed
approximately 7.69% to performance. The Fund’s average allocation to short positions was
-3.71%. The short positions detracted approximately 0.23% from performance.
Among the most important relative contributors were Actavis PLC.; The Blackstone Group
LP.; NXP Semiconductors NV; Avago Technologies Ltd.; and CVS Caremark Corp. Shares
of Actavis performed strongly during the first quarter of 2015. Actavis develops generic and
branded products for oncology, women’s health, and other medical needs. The company’s
acquisitions of Forest Laboratories, Inc.; Furiex Pharmaceuticals, Inc.; and Allergan,
Inc. have resulted in increased earnings and revenues estimates, thereby supporting the
performance of Actavis stock. The acquisitions, furthermore, have increased the company's
exposure to higher-margined drugs, especially dermatology products Botox and Juvederm
and eye care product Restasis. Actavis has also received Food and Drug Administration
approvals for several new drugs that have significant market potential.
Conversely, detracting from overall results on a relative basis were Kraft Foods Group, Inc.;
Oracle Corp.; Gilead Sciences, Inc.; and Microsoft Corp. Also detracting from performance
was AbbVie, Inc. The company is developing treatments for rheumatoid arthritis, psoriasis,
hepatitis C, Crohn's disease, and Parkinson's disease. Concerns that the company’s hepatitis
C treatment would lose market share to products from Gilead Sciences, Inc. hurt the
performance of AbbVie stock. In addition, AbbVie announced it will acquire Pharmacyclics,
Inc. for more than $21 billion, a price that many investors believe is too expensive.
Among short positions, NetSuite, Inc. was a top contributor to performance. The company
provides cloud-based software for small- and medium-size businesses. It generated a loss
in 2014 with revenues falling short of expenses. During the reporting period, NetSuite
management forecast first-quarter and full-year earnings that fell slightly below consensus
expectations. Short selling entails selling borrowed stock with the goal of buying the stock
in the future to return the security to the lender. As the price of NetSuite declined, the
portfolio’s cost of purchasing the stock declined, resulting in the position having a positive
impact on performance.
Short position Express Scripts Holding Company, however, detracted from results. The
company is a leading pharmacy benefits manager that offers services that help contain
pharmaceutical costs for large employers. Performance of Express Scripts shares
strengthened after the company’s management team said it was raising its outlook for
client retention despite a very price competitive environment. As the share price increased,
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the portfolio’s cost of purchasing the stock also increased, resulting in the short position
detracting from results.
Alger Green Fund
The Alger Green Fund returned 5.42% for the six-month period ended April 30, 2015,
compared to the 6.59% return of the Russell 3000 Growth Index.
During the period, the largest sector weightings were Information Technology and
Consumer Discretionary. The largest sector overweight was Industrials and the largest
sector underweight was Health Care. Relative outperformance in the Utilities and Industrials
sectors was the most important contributor to performance, while Health Care and
Consumer Staples were among sectors that detracted from results.
Among the most important relative contributors were TerraForm Power, Inc., Cl. A;
SunEdison, Inc.; Aetna, Inc.; Harman International Industries, Inc.; and Acuity Brands,
Inc. Performance of Acuity stock strengthened after the company’s management team said
increased manufacturing efficiency and strong sales of light emitting diodes drove strong
quarterly results. Acuity develops and distributes a variety of lighting products, including
components, power supplies, and integrated systems for commercial and residential
applications.
Conversely, detracting from overall results on a relative basis were EnerNOC, Inc.; Alibaba
Group Holding Ltd.; Johnson & Johnson; and Tesla Motors, Inc. Shares of consumer
packaged-goods company Procter & Gamble Co. also detracted from results. The
company offers products under brands such as Tide, Pampers, Pantene, Crest and Gillette.
Disappointing economic conditions in Europe, South America, and China have pressured
sales and earnings while the soaring U.S. dollar has resulted in significant currency losses.
Alger Analyst Fund
The Alger Analyst Fund returned 5.04% for the six-month period ended April 30, 2015,
compared to the 7.77% return of the Russell Midcap Growth Index.
During the period, the largest sector weightings were Consumer Discretionary and
Information Technology. The largest sector overweight was Consumer Discretionary and
the largest sector underweight was Health Care. Relative outperformance in a handful of
sectors including Consumer Discretionary, Energy, and Materials was the most important
contributor to performance, while Health Care and Consumer Staples were among sectors
that detracted from results.
Among the most important relative contributors were CoStar Group, Inc.; Jarden Corp.; The
Sherwin-Williams Co.; and Delphi Automotive PLC. Shares of cruise line operator Royal
Caribbean Cruises Ltd. also supported performance. The company has been experiencing an
increase in cruise booking, including cruises to ports in Europe, China, and the Caribbean.
Conversely, detracting from relative performance were Aerie Pharmaceuticals, Inc.; Pacira
Pharmaceuticals, Inc.; MGM Resorts International; and Pharmacyclics, Inc. Eagle Materials,
Inc., which is a domestic manufacturer of gypsum wallboard, cement, recycled paperboard,
aggregates, concrete, and sand for oil and natural gas wells that use hydraulic fracturing, also
detracted from results. During the reporting period, investors became concerned that low
oil prices would cause energy companies to curtail hydraulic fracturing, which could reduce
demand for fracturing sand.
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Alger Dynamic Opportunities Fund
The Alger Dynamic Opportunities Fund returned 3.19% for the six-month period ended
April 30, 2015, compared to the 4.40% return of the Fund’s benchmark, the S&P 500 index.
The Fund uses a strategy that includes long and short positions. The strategy seeks to
generate market-like returns over long-term periods, generally threeto five years, while
limiting the impact upon performance of market downturns. During shorter-term periods,
such strategies may underperform when markets generate strong gains, perform in line or
modestly outperform when markets are flat, and outperform when markets decline.
During the reporting period, the Fund’s long exposure increased from 66.50% to 68.18%
of assets. The Fund’s average long exposure was 68.14%. Long positions, in aggregate,
performed roughly in line with the Fund’s benchmark and had an approximately 3.17%
contribution to absolute performance. Short positions decreased from -16.30% of assets
to -12.74%. The average allocation to short position was -15.69%. Short positions trailed
the performance of the Fund’s benchmark and detracted 0.49% from performance. Net
exposure, which is the difference between long and short exposure, averaged 81.02%.
During the period, the largest sector weightings were Information Technology and Health
Care. The largest sector overweight was Health Care and the largest sector underweight was
Financials. Relative outperformance in the Information Technology and Energy sectors
was the most important contributor to performance, while Consumer Discretionary and
Consumer Staples were among sectors that detracted from results.
Among the most important relative contributors were The Blackstone Group LP.;
Pharmacyclics, Inc.; Habit Restaurants, Inc.; NXP Semiconductors NV; and Intercept
Pharmaceuticals, Inc. Netherlands-domiciled NXP manufactures components for radio
frequency, power management, and digital processing. Its products are used in smartphones,
including the iPhone. The shares performed strongly on expectations that growing sales of
the iPhone would support demand for NXP products that enable the smartphone to provide
digital payment services. Investors also reacted favorably to news that NXP will merge with
Freescale Semiconductor Ltd. because the deal could potentially result in significant revenue
and cost-saving synergies.
Conversely, detracting from relative performance were Apple, Inc.; Tenet Healthcare
Corporation; Insulet Corp.; and Halliburton Company. Shares of Precision Castparts
Corp. also detracted from results. The company manufactures metal components for a
wide variety of applications, including aircraft, gas turbines, and oil and natural gas wells.
It also manufactures fasteners used in aviation and other industries. Precision Castparts
stock performance weakened after the company reduced year-ahead guidance. Management
expects aviation customers to reduce their stock of aircraft components, while low oil and
gas prices have led to reduced demand for energy-industry products.
Among short positions, NetSuite, Inc. was a top contributor to performance for reasons
described in the Alger Spectra Fund discussion.
Short position Express Scripts Holding Company, however, detracted from results for
reasons described in the Alger Spectra Fund discussion.
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Alger Emerging Markets Fund
The Alger Emerging Markets Fund returned 3.60% for the six-month period ended April
30, 2015, compared to the 4.04% return of its benchmark, the MSCI Emerging Markets
Index.
During the reporting period, the largest sector weightings were Financials and Information
Technology. The largest sector overweight was Consumer Discretionary and the largest
sector underweight was Energy. Relative outperformance in the Consumer Discretionary
and Industrials sectors was the most important contributor to performance, while Financials
and Information Technology detracted from results.
Stock selection resulted in India, Brazil, South Korea, and Hong Kong providing the greatest
contributions to relative performance, while Columbia, Mexico, Taiwan, and Poland were
among countries that detracted from results.
Among the most important relative contributors were Cheil Industries, Inc.; Luxoft Holding,
Inc.; CJ CGV Co. Ltd.; and Ping An Insurance (Group) Company of China Ltd., Cl. H. Shares
of China South Locomotive and Rolling Stock Corp. also contributed to performance. The
company produces locomotive equipment and rolling stock and it provides related services.
Trading of its shares and the shares of various other railway-related companies was halted
in late October pending a mega-merger with China CNR Corporation, the equivalent rail
group for northern China. The shares reopened on the last day of the year with China South
Locomotive stock soaring, in part due to optimism over the merger. In addition, the outlook
for orders from both the mainland and from overseas remains promising with additional
railway capital expenditures having been announced.
Conversely, detracting from overall results on a relative basis were Pacific Rubiales Energy
Corp.; GAEC Educacao SA; Alfa S.A.B. de C.V. Cl. A; and Mexichem SAB de CV. Shares of
Qiwi PLC also detracted from results. Qiwi is a Russian payments provider. The company
posted stronger-than-expected third-quarter results, but investors became concerned that
the weakening ruble could impact future discretionary consumption, which could dampen
e-commerce, consumer credit, and money remittances that account for the bulk of Qiwi’s
revenues.
- 8 -
As always, we strive to deliver consistently superior investment results to you, our
shareholders, and we thank you for your continued confidence in Alger.
Respectfully submitted,
Daniel C. Chung, CFA
Chief Investment Officer
Fred Alger Management, Inc.
The following companies represented the stated percentages of Fred Alger Management,
Inc. assets under management as of April 30, 2015: FactSet Research Systems, Inc., 0.00%;
Empirical Research Partners, 0.00%; Goldman Sachs Group, 0.00%; Monsanto Co., 0.00%;
FedEx Corp., 0.00%; Oracle Corp, 0.00%; Adobe Systems, Inc., 0.74%; Bloomberg LP,
0.00%; Procter & Gamble Co., 0.00%; Apple, Inc., 5.23%; PepsiCo, Inc., 0.79%; Microsoft
Corp., 1.31%; eBay, Inc., 0.01%; Forest Laboratories, Inc., 0.00%; Furiex Pharmaceuticals,
Inc., 0.00%; Allergan, Inc., 0.00%; Gilead Sciences, Inc., 1.57%; Pharmacyclics, Inc., 0.25%;
China CNR Corporation, 0.00%; Freescale Semiconductor Ltd., 0.06%; Merck & Co., Inc.,
0.00%.
Investors cannot invest directly in an index. Index performance does not reflect the
deduction for fees, expenses, or taxes.
This report and the financial statements contained herein are submitted for the general
information of shareholders of the funds. This report is not authorized for distribution to
prospective investors in a fund unless proceeded or accompanied by an effective prospectus
for the fund. Fund performance returns represent the six-month period return of Class
A shares prior to the deduction of any sales charges and include the reinvestment of any
dividends or distributions.
The performance data quoted represents past performance, which is not an
indication or guarantee of future results.
Standardized performance results can be found on the following pages. The investment
return and principal value of an investment in a fund will fluctuate so that an investor’s
shares, when redeemed, may be worth more or less than their original cost. Current
performance may be lower or higher than the performance quoted. For performance data
current to the most recent month-end, visit us at www.alger.com or call us at (800) 992-3863.
The views and opinions of the funds’ management in this report are as of the date of the
Shareholders’ Letter and are subject to change at any time subsequent to this date. There
is no guarantee that any of the assumptions that formed the basis for the opinions stated
herein are accurate or that they will materialize. Moreover, the information forming the
basis for such assumptions is from sources believed to be reliable; however, there is no
guarantee that such information is accurate. Any securities mentioned, whether owned in a
fund or otherwise, are considered in the context of the construction of an overall portfolio
of securities and therefore reference to them should not be construed as a recommendation
or offer to purchase or sell any such security. Inclusion of such securities in a fund and
transactions in such securities, if any, may be for a variety of reasons, including, without
- 9 -
limitation, in response to cash flows, inclusion in a benchmark, and risk control. The
reference to a specific security should also be understood in such context and not viewed as
a statement that the security is a significant holding in a fund. Please refer to the Schedule
of Investments for each fund which is included in this report for a complete list of fund
holdings as of April 30, 2015. Securities mentioned in the Shareholders’ Letter, if not found
in the Schedule of Investments, may have been held by the funds during the fiscal period.
A Word about Risk
Growth stocks tend to be more volatile than other stocks as the price of growth stocks
tends to be higher in relation to their companies’ earnings and may be more sensitive
to market, political and economic developments. Investing in the stock market involves
gains and losses and may not be suitable for all investors. Stocks of small- and mid-sized
companies are subject to greater risk than stocks of larger, more established companies
owing to such factors as limited liquidity, inexperienced management, and limited financial
resources. Investing in foreign securities involves additional risk (including currency risk,
risks related to political, social or economic conditions, and risks associated with foreign
markets, such as increased volatility, limited liquidity, less stringent regulatory and legal
system, and lack of industry and country diversification), and may not be suitable for all
investors. Special risks associated with investments in emerging country issuers include
exposure to currency fluctuations, less liquidity, less developed or less efficient trading
markets, lack of comprehensive company information, political instability and different
auditing and legal standards.
Foreign currencies are subject to risks caused by inflation, interest rates, budget deficits and
low savings rates, political factors and government controls. Some of the countries where a
fund can invest may have restrictions that could limit the access to investment opportunities.
The securities of issuers located in emerging markets can be more volatile and less liquid
than those of issuers in more mature economies. Investing in emerging markets involves
higher levels of risk, including increased information, market, and valuation risks, and may
not be suitable for all investors.
Funds that participate in leveraging are subject to the risk that the cost of borrowing
money to leverage will exceed the returns for securities purchased or that the securities
purchased may actually go down in value; thus, the fund’s net asset value can decrease more
quickly than if the fund had not borrowed. The Alger Spectra Fund and the Alger Dynamic
Opportunities Fund may engage in short sales, which presents additional risk. To engage in
a short sale, a fund arranges with a broker to borrow the security being sold short. In order
to close out its short position, a fund will replace the security by purchasing the security at
the price prevailing at the time of replacement. The fund will incur a loss if the price of the
security sold short has increased since the time of the short sale and may experience a gain
if the price has decreased since the short sale.
The Alger Green Fund's environmental focus may limit the investment options available
to the Fund and may result in lower returns than returns of funds not subject to such
investment considerations. For a more detailed discussion of the risks associated with a
fund, please see the prospectus.
Before investing, carefully consider a fund’s investment objective, risks, charges,
and expenses.
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For a prospectus or a summary prospectus containing this and other information
about the Alger Funds II call us at (800) 992-3863 or visit us at www.alger.com. Read
it carefully before investing.
Fred Alger & Company, Incorporated, Distributor. Member NYSE Euronext, SIPC.
NOT FDIC INSURED. NOT BANK GUARANTEED. MAY LOSE VALUE.
Definitions:
• The S&P 500 is an unmanaged index generally representative of the U.S.
stock market without regard to company size.
• The MSCI Emerging Markets Index is a free float-adjusted market capital-
ization index that is designed to measure equity market performance in the
global emerging markets.
• The MSCI ACWI ex USA Index is a market capitalization-weighted index de-
signed to provide a broad measure of equity market performance throughout
the world, including both developed and emerging markets, but excluding the
United States.
• The Russell 3000 Growth Index measures the performance of the broad
growth segment of the U.S. equity universe. It includes those Russell 3000
Index companies with higher price-to-book ratios and higher forecasted
growth values.
• The Russell 1000 Growth Index is an unmanaged index designed to measure
the performance of the largest 1,000 companies in the Russell 3000 Index
with higher price-to-book ratios and higher forecasted growth values.
• The Russell Midcap Growth Index measures the performance of the mid-
cap growth segment of the U.S. equity universe. It includes those Russell
Midcap Index companies with higher price-to-book ratios and higher fore-
casted growth values.
• Empirical Research Partners LLC is a broker-dealer that provides research on
a range of topics of interest to institutional investors.
• FactSet Research Systems is a multinational financial data and software com-
pany.
• Goldman Sachs is a global investment banking, securities and investment
management firm.
• Bloomberg provides business and financial information, data, news, and in-
sight.
• Moody’s provides credit ratings, financial research, tools and analysis.
• Birinyi Associates, Inc. is a money management and research firm.
• MarketWatch operates a financial information website that provides business
news, analysis, and stock market data.
• S&P Dow Jones Indices provides investable and benchmark indices to the
financial markets.
- 11 -
• Corporate Compliance insights is a professionally designed and managed fo-
rum dedicated to online discussion and analysis of corporate compliance,
risk assessment, ethics, audit, and corporate governance topics.
The Fund’s average annual total returns include changes in share price and reinvestment of dividends and capital
gains.
Alger Spectra Fund’s Class A shares performance prior to September 23, 2008 is that of the fund’s Class N shares,
adjusted to reflect applicable sales charges and operating expenses.
| | | |
| FUND PERFORMANCE AS OF 3/31/15 (Unaudited) | |
| AVERAGE ANNUAL TOTAL RETURNS | | |
| | 1 YEAR | 5 YEARS | 10 YEARS |
| |
| Alger Spectra Class A | 12.11% | 14.61% | 13.27% |
| Alger Spectra Class C* | 16.44% | 14.99% | 13.06% |
| Alger Spectra Class I† | 18.35% | 15.90% | 13.97% |
| |
| |
| | 1 YEAR | 5 YEARS | Since 12/29/2010 |
| |
| Alger Spectra Class Z | 18.64% | n/a | 16.44% |
* Historical performance prior to September 24, 2008, inception of the class, is that of the Fund's Class A shares, adjusted to
reflect the current maximum sales charge and the higher operating expenses of Class C shares.
† Historical performance prior to September 24, 2008, inception of the class, is that of the Fund's Class A shares, which has
been adjusted to remove the front-end sales charge imposed by Class A shares.
- 12 -
Alger Green Fund’s Class A shares performance figures prior to January 12, 2007, are those of the Alger
Green Institutional Fund and performance prior to October 19, 2006, represents the performance of the
Alger Socially Responsible Growth Institutional Fund Class I, the predecessor fund to the Alger Green
Institutional Fund. The predecessor fund followed different investment strategies and had a different portfolio
manager. As of January 12, 2007, the Alger Green Institutional Fund became the Alger Green Fund.
| | | | |
| FUND PERFORMANCE AS OF 3/31/15 (Unaudited) | |
| AVERAGE ANNUAL TOTAL RETURNS | | |
| | 1 | 5 | 10 | SINCE |
| | YEAR | YEARS | YEARS | INCEPTION |
| Alger Green Class A (Inception 12/4/00) | 2.94% | 9.63% | 8.19% | 1.65% |
| Alger Green Class C (Inception 9/24/08)* | 6.98% | 9.97% | n/a | 8.23% |
| Alger Green Class I (Inception 9/24/08)† | 8.80% | 10.84% | n/a | 9.05% |
| |
| Alger Analyst Class A (Inception 3/30/07) | 6.09% | 11.70% | n/a | 7.04% |
| Alger Analyst Class C (Inception 9/24/08)* | 10.21% | 12.15% | n/a | 7.00% |
| Alger Analyst Class I (Inception 9/24/08)† | 11.93% | 12.91% | n/a | 7.75% |
| |
| Alger Dynamic Opportunities Class A (Inception 11/2/09) | 2.26% | 5.18% | n/a | 5.97% |
| Alger Dynamic Opportunities Class C (Inception | | | | |
| 12/29/10)‡ | 6.17% | 5 53% | n/a | 6.22% |
| Alger Dynamic Opportunities Class Z (Inception 12/29/10) | 8.31% | n/a | n/a | 6.96% |
| |
| Alger Emerging Markets Class A (Inception 12/29/10) | (5.62)% | n/a | n/a | (2.69)% |
| Alger Emerging Markets Class C (Inception 12/29/10) | (2.09)% | n/a | n/a | (2.29)% |
| Alger Emerging Markets Class I (Inception 12/29/10) | (0.43)% | n/a | n/a | (1.59)% |
| Alger Emerging Markets Class Z (Inception 2/28/14) | 0.11% | n/a | n/a | (0.20)% |
* Since inception performance is calculated since the inception of the Class A shares. Historical performance prior to September
24, 2008, inception of the class, is that of the Fund's Class A shares, reduced to reflect the current maximum sales charge
and the higher operating expenses of Class C shares.
† Since inception performance is calculated since the inception of the Class A shares. Historical performance prior to September
24, 2008, inception of the class, is that of the Fund's Class A shares, which has been adjusted to remove the front-end sales
charge imposed by Class A shares.
‡ Since inception performance is calculated since the inception of the Class A shares. Historical performance prior to December
29, 2010, inception of the class, is that of the Fund's Class A shares, reduced to reflect the current maximum sales charge
and the higher operating expenses of Class C shares.
- 13 -
ALGER SPECTRA FUND
Fund Highlights Through April 30, 2015 (Unaudited)
The chart above illustrates the change in value of a hypothetical $10,000 investment made in the Alger Spectra Fund
Class A shares, with an initial 5.25% maximum sales charge, and the Russell 3000 Growth Index (an unmanaged
index of common stocks) for the ten years ended April 30, 2015. The figures for the Alger Spectra Fund Class A and
the Russell 3000 Growth Index include reinvestment of dividends. Performance for the Alger Spectra Fund Class
C, Class I and Class Z shares will vary from the results shown above due to the operating expenses and the current
maximum sales charge of each share class. Investors cannot invest directly in any index. Index performance does
not reflect deduction for fees, expenses, or taxes.
| | | | |
| PERFORMANCE COMPARISON AS OF 4/30/15 | | |
| AVERAGE ANNUAL TOTAL RETURNS | | | |
| | | | | Since |
| | 1YEAR | 5YEARS | 10YEARS | 12/31/1974 |
| Class A (Inception 7/28/69) | 12.46% | 14.39% | 13.65% | 16.02% |
| Class C (Inception 9/24/08)* | 16.75% | 14.77% | 13.43% | 15.31% |
| Class I (Inception 9/24/08)† | 18.74% | 15.69% | 14.34% | 16.19% |
| Russell 3000 Growth Index | 16.50% | 15.45% | 9.69% | n/a |
| |
| |
| | | | | Since |
| | 1YEAR | 5YEARS | 10YEARS | 12/29/2010 |
| Class Z (Inception 12/29/10) | 19.03% | n/a | n/a | 15.86% |
| Russell 3000 Growth Index | 16.50% | n/a | n/a | 15.20% |
- 14 -
ALGER SPECTRA FUND
Fund Highlights Through April 30, 2015 (Unaudited) (Continued)
The performance data quoted represents past performance, which is not an indication or a guarantee of future results. The Fund’s average
annual total returns include changes in share price and reinvestment of dividends and capital gains. Class A returns reflect the maximum
initial sales charge and Class C returns reflect the applicable contingent deferred sales charge. Class A, C, and I historical performance
is calculated from December 31, 1974, the first full calendar year that Fred Alger Management, Inc. was the Fund's investment advisor.
The Fund operated as a closed-end fund from August 23, 1978 to February 12, 1996, during which time the calculation of total return
assumes dividends were reinvested at market value. Had dividends not been reinvested, performance would have been lower. The chart
and table above do not reflect the deduction of taxes that a shareholder would have paid on Fund distributions or on the redemption of
Fund shares. Investment return and principal will fluctuate and the Fund’s shares, when redeemed, may be worth more or less than their
original cost. Current performance may be higher or lower than the performance quoted. For updated performance, visit us at www.alger.
com or call us at (800) 992-3863.
* Since inception performance is calculated since the inception of the Class A shares. Historical performance prior to September
24, 2008, inception of the class, is that of the Fund's Class A shares, reduced to reflect the current maximum sales charge
and the higher operating expenses of Class C shares.
† Since inception performance is calculated since the inception of the Class A shares. Historical performance prior to September
24, 2008, inception of the class, is that of the Fund's Class A shares, which has been adjusted to remove the front-end sales
charge imposed by Class A shares.
- 15 -
ALGER GREEN FUND
Fund Highlights Through April 30, 2015 (Unaudited)
The chart above illustrates the change in value of a hypothetical $10,000 investment made in the Alger Green Fund
Class A shares, with an initial 5.25% maximum sales charge, and the Russell 3000 Growth Index (an unmanaged
index of common stocks) for the ten years ended April 30, 2015. The figures for the Alger Green Fund Class A and
the Russell 3000 Growth Index include reinvestment of dividends. Performance for the Alger Green Fund Class C
and Class I shares will vary from the results shown above due to the operating expenses and the current maximum
sales charge of each share class. Investors cannot invest directly in any index. Index performance does not reflect
deduction for fees, expenses, or taxes.
| | | | |
| PERFORMANCE COMPARISON AS OF 4/30/15 | | |
| AVERAGE ANNUAL TOTAL RETURNS | | | |
| | | | | Since |
| | 1 YEAR | 5 YEARS | 10 YEARS | 12/4/2000 |
| Class A (Inception 12/4/00) | 4.96% | 9.26% | 8.49% | 1.68% |
| Russell 3000 Growth Index | 16.50% | 15.45% | 9.69% | 4.33% |
| |
| |
| PERFORMANCE COMPARISON AS OF 4/30/15 | | |
| AVERAGE ANNUAL TOTAL RETURNS | | | |
| | | | | Since |
| | 1 YEAR | 5 YEARS | 10 YEARS | 12/4/2000 |
| Class C (Inception 9/24/08) | 8.90% | 9.55% | n/a | 8.20% |
| Class I (Inception 9/24/08) | 10.77% | 10.45% | n/a | 9.03% |
| Russell 3000 Growth Index | 16.50% | 15.45% | n/a | 12.94% |
- 16 -
ALGER GREEN FUND
Fund Highlights Through April 30, 2015 (Unaudited) (Continued)
The performance data quoted represents past performance, which is not an indication or a guarantee of future results. The Fund’s average
annual total returns include changes in share price and reinvestment of dividends and capital gains. Class A returns reflect the maximum
initial sales charge and Class C returns reflect the applicable contingent deferred sales charge. Performance figures prior to January 12,
2007, are those of the Alger Green Institutional Fund and performance prior to October 19, 2006, represents the performance of the
Alger Socially Responsible Growth Institutional Fund Class I, the predecessor fund to the Alger Green Institutional Fund. The pre-
decessor fund followed different investment strategies and had a different portfolio manager. As of January 12, 2007, the Alger Green
Institutional Fund became the Alger Green Fund. The chart and table above do not reflect the deduction of taxes that a shareholder
would have paid on Fund distributions or on the redemption of Fund shares. Investment return and principal will fluctuate and the
Fund’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be higher or lower than the
performance quoted. For updated performance, visit us at www.alger.com or call us at (800) 992-3863.
- 17 -
ALGER ANALYST FUND
Fund Highlights Through April 30, 2015 (Unaudited)
The chart above illustrates the change in value of a hypothetical $10,000 investment made in the Alger Analyst Fund
Class A shares, with an initial 5.25% maximum sales charge, and the Russell Midcap Growth Index (an unmanaged
index of common stocks) from March 30, 2007, the inception date of the Alger Analyst Fund Class A, through April
30, 2015. The figures for the Alger Analyst Fund Class A and the Russell Midcap Growth Index include reinvestment
of dividends. Performance for the Alger Analyst Fund Class C and Class I shares will vary from the results shown
above due to the operating expenses and the current maximum sales charge of each share class. Investors cannot
invest directly in any index. Index performance does not reflect deduction for fees, expenses, or taxes.
| | | | |
| PERFORMANCE COMPARISON AS OF 4/30/15 | | |
| AVERAGE ANNUAL TOTAL RETURNS | | | |
| | | | | Since |
| | 1 YEAR | 5 YEARS | 10 YEARS | 3/30/2007 |
| Class A (Inception 3/30/07) | 6.99% | 10.79% | n/a | 6.61% |
| Class C (Inception 9/24/08)* | 11.22% | 11.24% | n/a | 6.56% |
| Class I (Inception 9/24/08)† | 12.92% | 11.99% | n/a | 7.30% |
| Russell Midcap Growth Index | 16.46% | 15.59% | n/a | 8.93% |
The performance data quoted represents past performance, which is not an indication or a guarantee of future results. The Fund’s average
annual total returns include changes in share price and reinvestment of dividends and capital gains. Class A returns reflect the maximum
initial sales charge and Class C returns reflect the applicable contingent deferred sales charge. The chart and table above do not reflect the
deduction of taxes that a shareholder would have paid on Fund distributions or on the redemption of Fund shares. Investment return
and principal will fluctuate and the Fund’s shares, when redeemed, may be worth more or less than their original cost. Current performance
may be higher or lower than the performance quoted. For updated performance, visit us at www.alger.com or call us at (800) 992-3863.
* Since inception performance is calculated since the inception of the Class A shares. Historical performance prior to September
24, 2008, inception of the class, is that of the Fund's Class A shares, reduced to reflect the current maximum sales charge
and the higher operating expenses of Class C shares.
† Since inception performance is calculated since the inception of the Class A shares. Historical performance prior to September
24, 2008, inception of the class, is that of the Fund's Class A shares, which has been adjusted to remove the front-end sales
charge imposed by Class A shares.
- 18 -
ALGER DYNAMIC OPPORTUNITIES FUND
Fund Highlights Through April 30, 2015 (Unaudited)
The chart above illustrates the change in value of a hypothetical $10,000 investment made in Alger Dynamic
Opportunities Fund Class A shares, with an initial 5.25% maximum sales charge, and the S&P 500 Index and
the Blended S&P 500/3-Month London Interbank Offered Rate (“LIBOR”) (an unmanaged indices of common
stocks) from November 2, 2009, the inception date of the Alger Dynamic Opportunities Fund Class A, through
April 30, 2015. The figures for the Alger Dynamic Opportunities Fund Class A and the S&P 500 Index and the
Blended S&P 500/LIBOR include reinvestment of dividends. Performance for the Alger Dynamic Opportunities
Fund Class C and Class Z shares will vary from the results shown above due to the operating expenses and the
current maximum sales charge of each share class. Investors cannot invest directly in any index. Index performance
does not reflect deduction for fees, expenses, or taxes.
| | | | |
| PERFORMANCE COMPARISON AS OF 4/30/15 | | |
| AVERAGE ANNUAL TOTAL RETURNS | | | |
| | | | | Since |
| | 1 YEAR | 5 YEARS | 10 YEARS | 11/2/2009 |
| Class A (Inception 11/2/09) | 3.68% | 5.28% | n/a | 5.75% |
| Class C (Inception 12/29/10)* | 7.54% | 5.61% | n/a | 5.98% |
| S&P 500 Index | 12.98% | 14.33% | n/a | 15.86% |
| Blended S&P 500 / LIBOR | 6.53% | 7.34% | n/a | 8.05% |
| | | | |
| | | | | Since |
| | 1 YEAR | 5 YEARS | 10 YEARS | 12/29/2010 |
| Class Z (Inception 12/29/10) | 9.74% | n/a | n/a | 6.67% |
| S&P 500 Index | 12.98% | n/a | n/a | 14.73% |
| Blended S&P 500 / LIBOR | 6.53% | n/a | n/a | 7.47% |
The performance data quoted represents past performance, which is not an indication or a guarantee of future results. The Fund’s average
annual total returns include changes in share price and reinvestment of dividends and capital gains. Class A returns reflect the maximum
initial sales charge and Class C returns reflect the applicable contingent deferred sales charge. The chart and table above do not reflect the
deduction of taxes that a shareholder would have paid on Fund distributions or on the redemption of Fund shares. Investment return
and principal will fluctuate and the Fund’s shares, when redeemed, may be worth more or less than their original cost. Current performance
may be higher or lower than the performance quoted. For updated performance, visit us at www.alger.com or call us at (800) 992-3863.
- 19 -
ALGER DYNAMIC OPPORTUNITIES FUND
Fund Highlights Through April 30, 2015 (Unaudited) (Continued)
* Since inception performance is calculated since the inception of the Class A shares. Historical performance prior to
December 29, 2010, inception of the class, is that of the Fund's Class A shares, reduced to reflect the current maximum
sales charge and the higher operating expenses of Class C shares.
- 20 -
ALGER EMERGING MARKETS FUND
Fund Highlights Through April 30, 2015 (Unaudited)
The chart above illustrates the change in value of a hypothetical $10,000 investment made in Alger Emerging
Markets Fund Class A shares, with an initial 5.25% maximum sales charge, and the MSCI Emerging Markets Index
(an unmanaged index of common stocks) from December 29, 2010, the inception date of the Alger Emerging
Markets Fund Class A, through April 30, 2015. The figures for the Alger Emerging Markets Fund Class A and the
MSCI Emerging Markets Index include reinvestment of dividends. Performance for the Alger Emerging Markets
Fund Class C, Class I and Class Z shares will vary from the results shown above due to differences in expense and
sales charges those classes bear. Investors cannot invest directly in any index. Index performance does not reflect
deduction for fees, expenses, or taxes.
| | | | |
| PERFORMANCE COMPARISON AS OF 4/30/15 | | |
| AVERAGE ANNUAL TOTAL RETURNS | | | |
| | | | | Since |
| | 1YEAR | 5YEARS | 10YEARS | 12/29/2010 |
| Class A (Inception 12/29/10) | 0.82% | n/a | n/a | (1.33)% |
| Class C (Inception 12/29/10) | 4.54% | n/a | n/a | (0.97)% |
| Class I (Inception 12/29/10) | 6.46% | n/a | n/a | (0.23)% |
| MSCI Emerging Markets Index | 8.17% | n/a | n/a | 0.89% |
| |
| | | | | Since |
| | 1YEAR | 5YEARS | 10YEARS | 2/28/2014 |
| Class Z (Inception 2/28/14) | 6.89% | n/a | n/a | 4.92% |
| MSCI Emerging Markets Index | 8.17% | n/a | n/a | 10.18% |
The performance data quoted represents past performance, which is not an indication or a guarantee of future results. The Fund’s average
annual total returns include changes in share price and reinvestment of dividends and capital gains. Class A returns reflect the maximum
initial sales charge and Class C returns reflect the applicable contingent deferred sales charge. The chart and table above do not reflect the
deduction of taxes that a shareholder would have paid on Fund distributions or on the redemption of Fund shares. Investment return
and principal will fluctuate and the Fund’s shares, when redeemed, may be worth more or less than their original cost. Current performance
may be higher or lower than the performance quoted. For updated performance, visit us at www.alger.com or call us at (800) 992-3863.
- 21 -
PORTFOLIO SUMMARY†
April 30, 2015 (Unaudited)
| | | | | | | | |
| | | | | | | | | Alger Dynamic |
| SECTORS | | Alger Spectra Fund* | | Alger Green Fund | Alger Analyst Fund | | Opportunities Fund* |
| Consumer Discretionary | | 16.3% | | 22.4% | | 28.5% | | 6.2% |
| Consumer Staples | | 6.2 | | 7.4 | | 2.7 | | 1.9 |
| Energy | | 5.0 | | 0.0 | | 9.4 | | 1.8 |
| Exchange Traded Funds | | 0.0 | | 0.0 | | 0.0 | | 0.2 |
| Financials | | 8.9 | | 0.9 | | 5.8 | | 4.1 |
| Health Care | | 19.4 | | 8.3 | | 14.0 | | 12.2 |
| Industrials | | 8.6 | | 20.4 | | 13.3 | | 4.4 |
| Information Technology | | 31.2 | | 30.0 | | 18.7 | | 22.6 |
| Market Indices | | 0.0 | | 0.0 | | 0.0 | | (0.8) |
| Materials | | 1.9 | | 3.0 | | 3.8 | | 0.9 |
| Telecommunication Services | 1.3 | | 0.0 | | 1.3 | | 0.4 |
| U.S. Government & Agency | | 0.0 | | 0.0 | | 0.0 | | 27.7 |
| Utilities | | 0.8 | | 4.2 | | 0.0 | | 0.9 |
| Short-Term Investments and | | | | | | | | |
| Net Other Assets | | 0.4 | | 3.4 | | 2.5 | | 17.5 |
| | | 100.0% | | 100.0% | | 100.0% | | 100.0% |
| | | Alger Emerging Markets | | | | | | |
| COUNTRY | | Fund | | | | | | |
| Brazil | | 7.2% | | | | | | |
| Chile | | 0.9 | | | | | | |
| China | | 24.6 | | | | | | |
| Colombia | | 0.8 | | | | | | |
| Egypt | | 0.5 | | | | | | |
| Hong Kong | | 1.6 | | | | | | |
| India | | 9.9 | | | | | | |
| Indonesia | | 2.4 | | | | | | |
| Malaysia | | 1.4 | | | | | | |
| Mexico | | 5.1 | | | | | | |
| Peru | | 1.0 | | | | | | |
| Philippines | | 1.2 | | | | | | |
| Poland | | 0.2 | | | | | | |
| Russia | | 3.5 | | | | | | |
| South Africa | | 6.3 | | | | | | |
| South Korea | | 14.7 | | | | | | |
| Taiwan | | 10.3 | | | | | | |
| Thailand | | 1.8 | | | | | | |
| Turkey | | 1.4 | | | | | | |
| United Arab Emirates | | 0.7 | | | | | | |
| United Kingdom | | 1.3 | | | | | | |
| Cash and Net Other Assets | | 3.2 | | | | | | |
| | | 100.0% | | | | | | |
* Includes short sales as a reduction of sector exposure.
† Based on net assets for each Fund
- 22 -
THE ALGER FUNDS II ALGER SPECTRA FUND
Schedule of Investments April 30, 2015 (Unaudited)
| | | | | |
| COMMON STOCKS—98.3% | | SHARES | | | VALUE |
| ADVERTISING—0.0% | | | | | |
| Choicestream, Inc.*,@,(a) | | 178,292 | $ | 85,580 |
| AEROSPACE & DEFENSE—2.9% | | | | | |
| Honeywell International, Inc.+ | | 853,900 | | | 86,175,588 |
| Lockheed Martin Corp. | | 95,700 | | | 17,857,620 |
| The Boeing Co.+ | | 187,600 | | | 26,890,584 |
| United Technologies Corp. | | 106,500 | | | 12,114,375 |
| | | | | 143,038,167 |
| AIR FREIGHT & LOGISTICS—0.5% | | | | | |
| United Parcel Service, Inc., Cl. B | | 271,600 | | 27,303,948 |
| AIRLINES—0.9% | | | | | |
| JetBlue Airways Corp.* | | 213,100 | | | 4,374,943 |
| United Continental Holdings, Inc.* | | 717,599 | | | 42,869,364 |
| | | | | 47,244,307 |
| ALTERNATIVE CARRIERS—1.3% | | | | | |
| Level 3 Communications, Inc.* | | 661,400 | | | 36,998,716 |
| Zayo Group Holdings, Inc.* | | 989,900 | | | 26,281,845 |
| | | | | 63,280,561 |
| APPAREL ACCESSORIES & LUXURY GOODS—0.9% | | | | | |
| PVH Corp. | | 190,100 | | | 19,646,835 |
| Quiksilver, Inc.* | | 1,570,123 | | | 2,606,404 |
| Under Armour, Inc., Cl. A* | | 323,200 | | | 25,064,160 |
| | | | | 47,317,399 |
| APPLICATION SOFTWARE—2.7% | | | | | |
| Adobe Systems, Inc.* | | 597,700 | | | 45,461,062 |
| Autodesk, Inc.* | | 174,100 | | | 9,894,103 |
| Mobileye NV* | | 297,600 | | | 13,350,336 |
| Palantir Technologies, Inc., Cl. A*,@ | | 348,292 | | | 2,476,356 |
| Salesforce.com, inc.* | | 892,021 | | | 64,956,969 |
| | | | | 136,138,826 |
| ASSET MANAGEMENT & CUSTODY BANKS—0.2% | | | | | |
| Affiliated Managers Group, Inc.* | | 46,500 | | 10,515,045 |
| AUTO PARTS & EQUIPMENT—1.8% | | | | | |
| Delphi Automotive PLC. | | 808,100 | | | 67,072,300 |
| Lear Corp. | | 122,700 | | | 13,623,381 |
| WABCO Holdings, Inc.* | | 95,500 | | | 11,884,975 |
| | | | | 92,580,656 |
| AUTOMOBILE MANUFACTURERS—0.0% | | | | | |
| Tesla Motors, Inc.* | | 7,400 | | | 1,672,770 |
| BIOTECHNOLOGY—6.4% | | | | | |
| Amgen, Inc. | | 26,845 | | | 4,239,094 |
| Biogen, Inc.*+ | | 193,380 | | | 72,310,583 |
| BioMarin Pharmaceutical, Inc.* | | 196,500 | | | 22,017,825 |
| Celgene Corp.*+ | | 254,900 | | | 27,544,494 |
| Gilead Sciences, Inc.*+ | | 866,650 | | | 87,106,991 |
| Incyte Corp.* | | 203,100 | | | 19,733,196 |
| Intercept Pharmaceuticals, Inc.* | | 117,512 | | | 29,708,209 |
| Pharmacyclics, Inc.* | | 98,900 | | | 25,338,180 |
| Puma Biotechnology, Inc.* | | 21,970 | | | 3,967,343 |
- 23 -
THE ALGER FUNDS II ALGER SPECTRA FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | | VALUE |
| BIOTECHNOLOGY—(CONT.) | | | | | |
| United Therapeutics Corp.* | | 138,700 | $ | 22,149,003 |
| Vertex Pharmaceuticals, Inc.* | | 59,600 | | | 7,347,488 |
| | | | | 321,462,406 |
| BREWERS—0.6% | | | | | |
| Anheuser-Busch InBev NV# | | 51,000 | | | 6,122,040 |
| Molson Coors Brewing Co., Cl. B | | 315,100 | | | 23,163,001 |
| | | | | 29,285,041 |
| BUILDING PRODUCTS—0.6% | | | | | |
| Fortune Brands Home & Security, Inc. | | 246,995 | | | 11,015,977 |
| Lennox International, Inc. | | 177,300 | | | 18,786,708 |
| | | | | 29,802,685 |
| CABLE & SATELLITE—1.1% | | | | | |
| Comcast Corporation, Cl. A | | 917,740 | | 53,008,662 |
| COMMUNICATIONS EQUIPMENT—0.8% | | | | | |
| Arista Networks, Inc.* | | 432,958 | | | 27,713,642 |
| QUALCOMM, Inc. | | 203,400 | | | 13,831,200 |
| | | | | 41,544,842 |
| COMPUTER STORAGE & PERIPHERALS—0.1% | | | | | |
| SanDisk Corp. | | 106,400 | | | 7,122,416 |
| CONSTRUCTION MATERIALS—0.5% | | | | | |
| Martin Marietta Materials, Inc. | | 25,400 | | | 3,623,310 |
| Vulcan Materials Co. | | 274,600 | | | 23,483,792 |
| | | | | 27,107,102 |
| CONSUMER FINANCE—0.3% | | | | | |
| Discover Financial Services | | 268,455 | | 15,562,336 |
| DATA PROCESSING & OUTSOURCED SERVICES—3.7% | | | | | |
| Alliance Data Systems Corp.* | | 152,015 | | | 45,195,580 |
| Fiserv, Inc.* | | 356,700 | | | 27,679,920 |
| Visa, Inc., Cl. A+ | | 1,703,460 | | 112,513,533 |
| | | | | 185,389,033 |
| DEPARTMENT STORES—0.1% | | | | | |
| Nordstrom, Inc. | | 93,600 | | | 7,072,416 |
| DRUG RETAIL—2.6% | | | | | |
| CVS Caremark Corp. | | 752,200 | | | 74,685,938 |
| Rite Aid Corp.* | | 902,400 | | | 6,957,504 |
| Walgreens Boots Alliance, Inc. | | 573,550 | | | 47,564,502 |
| | | | | 129,207,944 |
| FOOD RETAIL—0.8% | | | | | |
| The Kroger Co. | | 363,600 | | | 25,055,676 |
| Whole Foods Market, Inc. | | 314,900 | | | 15,039,624 |
| | | | | 40,095,300 |
| FOOTWEAR—0.9% | | | | | |
| NIKE, Inc., Cl. B | | 460,500 | | 45,515,820 |
| GENERAL MERCHANDISE STORES—1.4% | | | | | |
| Dollar General Corp. | | 303,000 | | | 22,031,130 |
| Dollar Tree, Inc.* | | 614,600 | | | 46,961,586 |
| | | | | 68,992,716 |
- 24 -
THE ALGER FUNDS II ALGER SPECTRA FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | | VALUE |
| HEALTH CARE EQUIPMENT—1.3% | | | | | |
| Becton Dickinson and Co. | | 255,100 | $ | 35,935,937 |
| DexCom, Inc.* | | 217,298 | | | 14,682,826 |
| Intuitive Surgical, Inc.* | | 25,900 | | | 12,845,882 |
| | | | | 63,464,645 |
| HEALTH CARE FACILITIES—1.2% | | | | | |
| HCA Holdings, Inc.* | | 722,149 | | | 53,446,247 |
| Universal Health Services, Inc., Cl. B | | 67,300 | | | 7,870,735 |
| | | | | 61,316,982 |
| HEALTH CARE SERVICES—0.6% | | | | | |
| Omnicare, Inc. | | 313,400 | | 27,572,932 |
| HOME ENTERTAINMENT SOFTWARE—0.5% | | | | | |
| Activision Blizzard, Inc. | | 1,093,100 | | 24,939,077 |
| HOME IMPROVEMENT RETAIL—1.7% | | | | | |
| Lowe's Companies, Inc. | | 879,800 | | | 60,583,028 |
| The Home Depot, Inc. | | 249,596 | | | 26,701,780 |
| | | | | 87,284,808 |
| HOMEBUILDING—0.2% | | | | | |
| Toll Brothers, Inc.* | | 281,700 | | | 10,011,618 |
| HOTELS RESORTS & CRUISE LINES—2.3% | | | | | |
| Ctrip.com International Ltd.#* | | 497,800 | | | 31,699,904 |
| Hilton Worldwide Holdings, Inc.* | | 1,629,019 | | | 47,176,390 |
| Norwegian Cruise Line Holdings Ltd.* | | 190,900 | | | 9,260,559 |
| Royal Caribbean Cruises Ltd.+ | | 365,312 | | | 24,863,135 |
| | | | | 112,999,988 |
| HOUSEWARES & SPECIALTIES—0.4% | | | | | |
| Jarden Corp.* | | 353,750 | | 18,104,925 |
| INDUSTRIAL CONGLOMERATES—1.0% | | | | | |
| Danaher Corp. | | 419,200 | | | 34,324,096 |
| General Electric Co. | | 497,000 | | | 13,458,760 |
| | | | | 47,782,856 |
| INDUSTRIAL GASES—0.5% | | | | | |
| Air Products & Chemicals, Inc. | | 172,500 | | 24,741,675 |
| INDUSTRIAL MACHINERY—0.5% | | | | | |
| Ingersoll-Rand PLC. | | 398,104 | | | 26,211,167 |
| INTERNET RETAIL—2.8% | | | | | |
| Amazon.com, Inc.*+ | | 179,900 | | | 75,878,222 |
| NetFlix, Inc.* | | 26,600 | | | 14,802,900 |
| Qunar Cayman Islands Ltd.#* | | 291,300 | | | 13,641,579 |
| The Priceline Group, Inc.* | | 15,300 | | | 18,938,493 |
| TripAdvisor, Inc.* | | 190,503 | | | 15,333,586 |
| | | | | 138,594,780 |
| INTERNET SOFTWARE & SERVICES—9.6% | | | | | |
| Demandware, Inc.* | | 420,600 | | | 25,908,960 |
| Facebook, Inc., Cl. A*+ | | 2,628,315 | | 207,032,373 |
| Google, Inc., Cl. C*+ | | 272,053 | | 146,184,959 |
| GrubHub, Inc.* | | 910,058 | | | 37,467,088 |
| LinkedIn Corp., Cl. A* | | 99,700 | | | 25,137,361 |
- 25 -
THE ALGER FUNDS II ALGER SPECTRA FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | | VALUE |
| INTERNET SOFTWARE & SERVICES—(CONT.) | | | | | |
| Yahoo! Inc.* | | 986,595 | $ | 41,994,416 |
| | | | | 483,725,157 |
| INVESTMENT BANKING & BROKERAGE—0.5% | | | | | |
| Morgan Stanley | | 181,000 | | | 6,753,110 |
| The Charles Schwab Corp. | | 529,000 | | | 16,134,500 |
| | | | | 22,887,610 |
| IT CONSULTING & OTHER SERVICES—0.5% | | | | | |
| Cognizant Technology Solutions Corp., Cl. A* | | 462,200 | | 27,057,188 |
| LIFE SCIENCES TOOLS & SERVICES—1.1% | | | | | |
| Thermo Fisher Scientific, Inc.+ | | 438,274 | | 55,082,276 |
| MANAGED HEALTH CARE—2.8% | | | | | |
| Aetna, Inc. | | 27,700 | | | 2,960,299 |
| Cigna Corp. | | 515,500 | | | 64,251,920 |
| Humana, Inc. | | 352,300 | | | 58,340,880 |
| UnitedHealth Group, Inc. | | 139,424 | | | 15,531,834 |
| | | | | 141,084,933 |
| MOVIES & ENTERTAINMENT—1.3% | | | | | |
| The Walt Disney Co. | | 614,700 | | 66,830,184 |
| MULTI-LINE INSURANCE—1.4% | | | | | |
| American International Group, Inc. | | 229,900 | | | 12,941,071 |
| Hartford Financial Services Group, Inc. | | 1,388,955 | | | 56,627,695 |
| | | | | 69,568,766 |
| MULTI-UTILITIES—0.4% | | | | | |
| Sempra Energy | | 166,700 | | 17,698,539 |
| OIL & GAS EQUIPMENT & SERVICES—1.8% | | | | | |
| Baker Hughes, Inc. | | 925,600 | | | 63,366,576 |
| Schlumberger Ltd. | | 87,500 | | | 8,278,375 |
| Weatherford International PLC.* | | 1,378,020 | | | 20,050,191 |
| | | | | 91,695,142 |
| OIL & GAS EXPLORATION & PRODUCTION—2.7% | | | | | |
| Anadarko Petroleum Corp.+ | | 753,651 | | | 70,918,559 |
| Devon Energy Corp. | | 954,000 | | | 65,072,340 |
| | | | | 135,990,899 |
| OIL & GAS STORAGE & TRANSPORTATION—0.5% | | | | | |
| Cheniere Energy, Inc.* | | 331,057 | | 25,322,550 |
| OIL, GAS & CONSUMABLE FUELS—0.3% | | | | | |
| The Williams Cos., Inc. | | 253,300 | | 12,966,427 |
| OTHER DIVERSIFIED FINANCIAL SERVICES—2.1% | | | | | |
| Bank of America Corp. | | 2,433,617 | | | 38,767,519 |
| Citigroup, Inc. | | 1,246,800 | | | 66,479,376 |
| | | | | 105,246,895 |
| PACKAGED FOODS & MEATS—0.5% | | | | | |
| Mead Johnson Nutrition Co., Cl. A | | 239,800 | | 23,001,616 |
| PHARMACEUTICALS—5.7% | | | | | |
| Actavis PLC.*+ | | 611,265 | | 172,902,418 |
| Bristol-Myers Squibb Co. | | 527,500 | | | 33,617,575 |
| Mallinckrodt PLC.* | | 74,500 | | | 8,431,910 |
| Mylan NV* | | 142,700 | | | 10,311,502 |
- 26 -
THE ALGER FUNDS II ALGER SPECTRA FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | | VALUE |
| PHARMACEUTICALS—(CONT.) | | | | | |
| Pacira Pharmaceuticals, Inc.* | | 59,460 | $ | 4,071,821 |
| Shire PLC. | | 630,438 | | | 51,644,802 |
| Teva Pharmaceutical Industries Ltd.# | | 118,200 | | | 7,141,644 |
| | | | | 288,121,672 |
| RAILROADS—0.9% | | | | | |
| Union Pacific Corp. | | 424,100 | | 45,052,143 |
| RENEWABLE ELECTRICITY—0.4% | | | | | |
| TerraForm Power, Inc., Cl. A | | 467,630 | | 18,485,414 |
| RESEARCH & CONSULTING SERVICES—0.3% | | | | | |
| CoStar Group, Inc.* | | 64,814 | | 13,249,926 |
| RESTAURANTS—1.4% | | | | | |
| Darden Restaurants, Inc. | | 204,600 | | | 13,047,342 |
| McDonald's Corp. | | 213,237 | | | 20,588,032 |
| Starbucks Corp.+ | | 691,060 | | | 34,262,755 |
| | | | | 67,898,129 |
| SECURITY & ALARM SERVICES—0.7% | | | | | |
| Tyco International PLC. | | 871,321 | | 34,312,621 |
| SEMICONDUCTOR EQUIPMENT—1.2% | | | | | |
| Lam Research Corp. | | 54,675 | | | 4,132,337 |
| SunEdison, Inc.* | | 2,248,500 | | | 56,932,020 |
| | | | | 61,064,357 |
| SEMICONDUCTORS—3.7% | | | | | |
| Altera Corp. | | 356,040 | | | 14,839,747 |
| Avago Technologies Ltd. | | 385,600 | | | 45,068,928 |
| Broadcom Corp., Cl. A | | 626,000 | | | 27,672,330 |
| Micron Technology, Inc.* | | 1,461,045 | | | 41,099,196 |
| NXP Semiconductors NV* | | 511,721 | | | 49,186,623 |
| Samsung Electronics Co., Ltd. | | 6,500 | | | 8,508,880 |
| | | | | 186,375,704 |
| SOFT DRINKS—1.0% | | | | | |
| PepsiCo, Inc.+ | | 534,515 | | 50,843,067 |
| SPECIALIZED FINANCE—0.6% | | | | | |
| McGraw Hill Financial, Inc. | | 267,200 | | 27,868,960 |
| SPECIALTY CHEMICALS—1.1% | | | | | |
| PPG Industries, Inc. | | 258,200 | | 57,206,792 |
| SPECIALTY STORES—0.8% | | | | | |
| Signet Jewelers Ltd. | | 316,212 | | 42,413,516 |
| SYSTEMS SOFTWARE—2.5% | | | | | |
| Microsoft Corp.+ | | 1,679,420 | | | 81,686,989 |
| Oracle Corp. | | 719,700 | | | 31,393,314 |
| ServiceNow, Inc.* | | 164,900 | | | 12,344,414 |
| | | | | 125,424,717 |
| TECHNOLOGY HARDWARE STORAGE & PERIPHERALS—6.5% | | | | | |
| Apple, Inc.+ | | 2,475,985 | | 309,869,523 |
| Western Digital Corp. | | 187,560 | | | 18,332,114 |
| | | | | 328,201,637 |
| TOBACCO—0.7% | | | | | |
| Altria Group, Inc. | | 716,100 | | 35,840,805 |
- 27 -
THE ALGER FUNDS II ALGER SPECTRA FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | | VALUE |
| TRADING COMPANIES & DISTRIBUTORS—1.2% | | | | | |
| HD Supply Holdings, Inc.* | | 1,788,571 | $ 59,022,843 |
| TOTAL COMMON STOCKS | | | | | |
| (Cost $4,187,513,432) | | | | 4,932,911,916 |
| PREFERRED STOCKS—0.7% | | SHARES | | | VALUE |
| ADVERTISING—0.1% | | | | | |
| Choicestream, Inc., Cl. A*,@,(a) | | 1,537,428 | | | 737,965 |
| Choicestream, Inc., Cl. B*,@,(a) | | 3,765,639 | | | 1,807,507 |
| | | | | | 2,545,472 |
| APPLICATION SOFTWARE—0.2% | | | | | |
| Palantir Technologies, Inc., Cl. B*,@ | | 1,420,438 | | | 10,099,314 |
| Palantir Technologies, Inc., Cl. D*,@ | | 185,062 | | | 1,315,791 |
| | | | | | 11,415,105 |
| BIOTECHNOLOGY—0.3% | | | | | |
| Prosetta Biosciences, Inc.*,@,(a) | | 2,912,012 | | 13,104,054 |
| PHARMACEUTICALS—0.1% | | | | | |
| Intarcia Therapeutics, Inc.*,@ | | 171,099 | | | 7,528,356 |
| TOTAL PREFERRED STOCKS | | | | | |
| (Cost $32,736,484) | | | | | 34,592,987 |
| MASTER LIMITED PARTNERSHIP—2.9% | | SHARES | | | VALUE |
| ASSET MANAGEMENT & CUSTODY BANKS—2.9% | | | | | |
| The Blackstone Group LP. | | 3,173,069 | | 129,968,907 |
| The Carlyle Group LP. | | 551,480 | | | 16,649,181 |
| | | | | 146,618,088 |
| TOTAL MASTER LIMITED PARTNERSHIP | | | | | |
| (Cost $120,551,759) | | | | 146,618,088 |
| REAL ESTATE INVESTMENT TRUST—1.3% | | SHARES | | | VALUE |
| HEALTH CARE—0.1% | | | | | |
| Physicians Realty Trust | | 310,500 | | | 5,154,300 |
| MORTGAGE—0.5% | | | | | |
| Blackstone Mortgage Trust, Inc., Cl. A | | 767,500 | | 23,585,275 |
| SPECIALIZED—0.7% | | | | | |
| Crown Castle International Corp. | | 440,000 | | 36,753,200 |
| TOTAL REAL ESTATE INVESTMENT TRUST | | | | | |
| (Cost $65,401,660) | | | | | 65,492,775 |
| Total Investments | | | | | |
| (Cost $4,406,203,335)(b) | | 103.2% | | 5,179,615,766 |
| Liabilities in Excess of Other Assets | | (3.2)% | | (162,055,880) |
| NET ASSETS | | 100.0% | $ 5,017,559,886 |
# American Depositary Receipts.
(a) Deemed an affiliate of the Alger fund complex during the year for purposes of Section 2(a)(3) of the Investment
Company Act of 1940. See Affiliated Securities in Notes to Financial Statements.
(b) At April 30, 2015, the net unrealized appreciation on investments, based on cost for federal income tax purposes
of $4,461,789,003, amounted to $717,826,763 which consisted of aggregate gross unrealized appreciation of
$810,648,991 and aggregate gross unrealized depreciation of $92,822,228.
* Non-income producing security.
- 28 -
THE ALGER FUNDS II ALGER SPECTRA FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
@ Restricted security - Investment in security not registered under the Securities Act of 1933. The investment is deemed
to not be liquid and may be sold only to qualified buyers.
| | | | |
| Security | Acquisition Date(s) | Cost | Market Value | % of net assets |
| Choicestream, Inc. | 3/14/2014 | $51,705 | $85,580 | 0.00% |
| Choicestream, Inc., Cl. A | 12/17/2013 | 1,229,452 | 737,965 | 0.01% |
| Choicestream, Inc., Cl. B | 7/10/2014 | 2,259,383 | 1,807,507 | 0.04% |
| Intarcia Therapeutics, Inc. | 3/27/2014 | 5,541,897 | 7,528,356 | 0.15% |
| Palantir Technologies, Inc., Cl. A | 10/07/2014 | 2,266,336 | 2,476,356 | 0.05% |
| Palantir Technologies, Inc., Cl. B | 10/07/2014 | 9,379,767 | 10,099,314 | 0.20% |
| Palantir Technologies, Inc., Cl. D | 10/14/2014 | 1,221,931 | 1,315,791 | 0.03% |
| Prosetta Biosciences, Inc. | 2/06/2015 | 13,104,054 | 13,104,054 | 0.26% |
| Total | | | $37,154,923 | 0.74% |
| | | | | |
| + All or a portion of this security is held as collateral for securities sold short. | | |
| |
| See Notes to Financial Statements | | | | |
- 29 -
THE ALGER FUNDS II ALGER SPECTRA FUND
Schedule of Investments- Securities Sold Short April 30, 2015 (Unaudited)
| | | | | |
| COMMON STOCKS—-3.6% | | SHARES | | | VALUE |
| AGRICULTURAL & FARM MACHINERY—-0.2% | | | | | |
| Deere & Co. | | (98,200) | $ | (8,889,064) |
| ASSET MANAGEMENT & CUSTODY BANKS—-0.2% | | | | | |
| Waddell & Reed Financial, Inc., Cl. A | | (248,100) | | (12,236,292) |
| BIOTECHNOLOGY—-0.1% | | | | | |
| Myriad Genetics, Inc.* | | (163,716) | | | (5,407,540) |
| BROADCASTING—-0.2% | | | | | |
| Scripps Networks Interactive, Inc., Cl. A | | (123,400) | | | (8,620,724) |
| COMMUNICATIONS EQUIPMENT—-0.1% | | | | | |
| Polycom, Inc.* | | (407,700) | | | (5,320,485) |
| COMPUTER STORAGE & PERIPHERALS—0.0% | | | | | |
| NetApp, Inc. | | (48,500) | | | (1,758,125) |
| CONSTRUCTION & FARM MACHINERY & HEAVY TRUCKS—-0.5% | | | | | |
| Cummins, Inc. | | (60,000) | | | (8,295,600) |
| PACCAR, Inc. | | (208,900) | | (13,651,615) |
| | | | | (21,947,215) |
| DATA PROCESSING & OUTSOURCED SERVICES—-0.1% | | | | | |
| Syntel, Inc.* | | (99,900) | | | (4,497,498) |
| EXCHANGE TRADED FUNDS—-0.3% | | | | | |
| SPDR S&P Oil & Gas Exploration & Production ETF | | (239,924) | | (13,217,413) |
| HOUSEWARES & SPECIALTIES—-0.3% | | | | | |
| Tupperware Brands Corp. | | (254,400) | | (17,009,184) |
| INTERNET SOFTWARE & SERVICES—-0.2% | | | | | |
| AOL, Inc.* | | (232,700) | | | (9,284,730) |
| REGIONAL BANKS—-0.2% | | | | | |
| Hancock Holding Co. | | (322,800) | | | (9,396,708) |
| RESTAURANTS—-0.4% | | | | | |
| Dunkin' Brands Group, Inc. | | (353,400) | | (18,415,674) |
| SEMICONDUCTORS—-0.3% | | | | | |
| Linear Technology Corp. | | (316,400) | | (14,595,532) |
| Taiwan Semiconductor Manufacturing Co., Ltd.# | | (78,200) | | | (1,911,208) |
| | | | | (16,506,740) |
| SPECIALTY CHEMICALS—-0.2% | | | | | |
| Celanese Corp. | | (132,100) | | | (8,766,156) |
| SYSTEMS SOFTWARE—-0.1% | | | | | |
| NetSuite, Inc.* | | (85,300) | | | (8,152,121) |
| TRADING COMPANIES & DISTRIBUTORS—-0.2% | | | | | |
| Fastenal Co. | | (282,300) | | (12,031,626) |
| TOTAL (Proceeds $184,395,140) | | | $ (181,457,295) |
* Non-income producing security.
# American Depositary Receipts.
See Notes to Financial Statements.
- 30 -
THE ALGER FUNDS II ALGER GREEN FUND
Schedule of Investments April 30, 2015 (Unaudited)
| | | | | |
| COMMON STOCKS—96.5% | | SHARES | | | VALUE |
| ADVERTISING—0.0% | | | | | |
| Choicestream, Inc.*,@,(a) | | 3,619 | $ | 1,737 |
| AEROSPACE & DEFENSE—3.0% | | | | | |
| Hexcel Corp. | | 17,450 | | | 875,117 |
| Honeywell International, Inc. | | 15,440 | | | 1,558,205 |
| | | | | | 2,433,322 |
| AGRICULTURAL & FARM MACHINERY—0.5% | | | | | |
| Lindsay Corp. | | 5,510 | | | 436,337 |
| AIR FREIGHT & LOGISTICS—2.2% | | | | | |
| FedEx Corp. | | 5,515 | | | 935,178 |
| United Parcel Service, Inc., Cl. B | | 8,190 | | | 823,341 |
| | | | | | 1,758,519 |
| APPLICATION SOFTWARE—1.5% | | | | | |
| EnerNOC, Inc.* | | 37,525 | | | 414,651 |
| SAP SE# | | 10,330 | | | 781,878 |
| | | | | | 1,196,529 |
| AUTO PARTS & EQUIPMENT—3.5% | | | | | |
| BorgWarner, Inc. | | 21,140 | | | 1,251,488 |
| Delphi Automotive PLC. | | 5,015 | | | 416,245 |
| Johnson Controls, Inc. | | 24,140 | | | 1,216,173 |
| | | | | | 2,883,906 |
| AUTOMOBILE MANUFACTURERS—2.2% | | | | | |
| General Motors Co. | | 9,060 | | | 317,643 |
| Tesla Motors, Inc.* | | 6,455 | | | 1,459,153 |
| | | | | | 1,776,796 |
| COMMODITY CHEMICALS—0.9% | | | | | |
| Calgon Carbon Corp. | | 33,430 | | | 741,812 |
| COMMUNICATIONS EQUIPMENT—1.1% | | | | | |
| Cisco Systems, Inc. | | 31,190 | | | 899,208 |
| CONSTRUCTION & ENGINEERING—0.7% | | | | | |
| AECOM* | | 16,870 | | | 532,417 |
| CONSUMER ELECTRONICS—1.5% | | | | | |
| Harman International Industries, Inc. | | 9,665 | | | 1,260,123 |
| DATA PROCESSING & OUTSOURCED SERVICES—2.9% | | | | | |
| Alliance Data Systems Corp.* | | 3,965 | | | 1,178,834 |
| Visa, Inc., Cl. A | | 17,900 | | | 1,182,295 |
| | | | | | 2,361,129 |
| DISTRIBUTORS—1.6% | | | | | |
| LKQ Corp.* | | 49,255 | | | 1,333,333 |
| ELECTRIC UTILITIES—1.8% | | | | | |
| Duke Energy Corp. | | 9,010 | | | 698,906 |
| ITC Holdings Corp. | | 21,765 | | | 783,540 |
| | | | | | 1,482,446 |
| ELECTRICAL COMPONENTS & EQUIPMENT—4.0% | | | | | |
| Acuity Brands, Inc. | | 12,295 | | | 2,052,650 |
- 31 -
THE ALGER FUNDS II ALGER GREEN FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | | VALUE |
| ELECTRICAL COMPONENTS & EQUIPMENT—(CONT.) | | | | | |
| SolarCity Corp.* | | 20,400 | $ | 1,225,020 |
| | | | | | 3,277,670 |
| ELECTRONIC EQUIPMENT MANUFACTURERS—0.7% | | | | | |
| Itron, Inc.* | | 15,035 | | | 539,155 |
| ELECTRONIC MANUFACTURING SERVICES—0.3% | | | | | |
| Trimble Navigation Ltd.* | | 10,030 | | | 255,063 |
| ENVIRONMENTAL & FACILITIES SERVICES—4.1% | | | | | |
| Clean Harbors, Inc.* | | 10,490 | | | 579,573 |
| Covanta Holding Corp. | | 37,680 | | | 764,527 |
| Tetra Tech, Inc. | | 37,500 | | | 1,016,625 |
| Waste Management, Inc. | | 19,170 | | | 949,490 |
| | | | | | 3,310,215 |
| FOOD DISTRIBUTORS—1.5% | | | | | |
| United Natural Foods, Inc.* | | 17,545 | | | 1,183,586 |
| FOOD RETAIL—1.4% | | | | | |
| Whole Foods Market, Inc. | | 24,415 | | | 1,166,060 |
| FOOTWEAR—2.7% | | | | | |
| NIKE, Inc., Cl. B | | 22,690 | | | 2,242,680 |
| HOME IMPROVEMENT RETAIL—3.0% | | | | | |
| The Home Depot, Inc. | | 23,245 | | | 2,486,750 |
| HOUSEHOLD PRODUCTS—1.3% | | | | | |
| The Procter & Gamble Co. | | 13,504 | | | 1,073,703 |
| HYPERMARKETS & SUPER CENTERS—0.4% | | | | | |
| Wal-Mart Stores, Inc. | | 4,540 | | | 354,347 |
| INDUSTRIAL CONGLOMERATES—1.5% | | | | | |
| General Electric Co. | | 44,755 | | | 1,211,965 |
| INDUSTRIAL GASES—0.9% | | | | | |
| Praxair, Inc. | | 5,860 | | | 714,510 |
| INDUSTRIAL MACHINERY—3.5% | | | | | |
| Pall Corp. | | 10,040 | | | 977,093 |
| Woodward Governor Co. | | 19,370 | | | 911,358 |
| Xylem, Inc. | | 25,755 | | | 953,450 |
| | | | | | 2,841,901 |
| INTERNET RETAIL—2.3% | | | | | |
| Amazon.com, Inc.* | | 4,510 | | | 1,902,228 |
| INTERNET SOFTWARE & SERVICES—7.4% | | | | | |
| eBay, Inc.* | | 21,835 | | | 1,272,107 |
| Facebook, Inc., Cl. A* | | 25,840 | | | 2,035,417 |
| Google, Inc., Cl. A* | | 2,530 | | | 1,388,388 |
| Google, Inc., Cl. C* | | 2,536 | | | 1,362,694 |
| | | | | | 6,058,606 |
| LIFE & HEALTH INSURANCE—0.9% | | | | | |
| Lincoln National Corp. | | 12,950 | | | 731,546 |
- 32 -
THE ALGER FUNDS II ALGER GREEN FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | | VALUE |
| MANAGED HEALTH CARE—1.9% | | | | | |
| Aetna, Inc. | | 10,080 | $ | 1,077,250 |
| Cigna Corp. | | 3,905 | | | 486,719 |
| | | | | | 1,563,969 |
| MOVIES & ENTERTAINMENT—2.0% | | | | | |
| The Walt Disney Co. | | 15,370 | | | 1,671,026 |
| PACKAGED FOODS & MEATS—1.2% | | | | | |
| The WhiteWave Foods Co.* | | 22,670 | | | 996,800 |
| PHARMACEUTICALS—6.4% | | | | | |
| Actavis PLC.* | | 5,540 | | | 1,567,045 |
| Bristol-Myers Squibb Co. | | 24,880 | | | 1,585,602 |
| Johnson & Johnson | | 14,665 | | | 1,454,768 |
| Merck & Co., Inc. | | 10,705 | | | 637,590 |
| | | | | | 5,245,005 |
| RAILROADS—0.9% | | | | | |
| Norfolk Southern Corp. | | 7,225 | | | 728,641 |
| RENEWABLE ELECTRICITY—2.4% | | | | | |
| TerraForm Power, Inc., Cl. A | | 49,880 | | | 1,971,756 |
| RESTAURANTS—3.5% | | | | | |
| Chipotle Mexican Grill, Inc.* | | 2,635 | | | 1,637,231 |
| Starbucks Corp. | | 24,565 | | | 1,217,933 |
| | | | | | 2,855,164 |
| SEMICONDUCTOR EQUIPMENT—2.1% | | | | | |
| SunEdison, Inc.* | | 67,650 | | | 1,712,898 |
| SEMICONDUCTORS—4.4% | | | | | |
| Broadcom Corp., Cl. A | | 20,825 | | | 920,569 |
| ChipMOS TECHNOLOGIES Bermuda Ltd. | | 22,060 | | | 509,586 |
| First Solar, Inc.* | | 22,690 | | | 1,353,912 |
| Intel Corp. | | 25,545 | | | 831,490 |
| | | | | | 3,615,557 |
| SOFT DRINKS—1.6% | | | | | |
| The Coca-Cola Co. | | 31,660 | | | 1,284,130 |
| SPECIALTY CHEMICALS—1.2% | | | | | |
| Albemarle Corp. | | 8,260 | | | 493,122 |
| Chemtura Corp.* | | 17,315 | | | 521,701 |
| | | | | | 1,014,823 |
| SYSTEMS SOFTWARE—1.8% | | | | | |
| Microsoft Corp. | | 29,620 | | | 1,440,717 |
| TECHNOLOGY HARDWARE STORAGE & PERIPHERALS—7.8% | | | | | |
| Apple, Inc. | | 47,490 | | | 5,943,373 |
| EMC Corp. | | 15,480 | | | 416,567 |
| | | | | | 6,359,940 |
| TOTAL COMMON STOCKS | | | | | |
| (Cost $56,132,917) | | | | | 78,908,025 |
- 33 -
THE ALGER FUNDS II ALGER GREEN FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | |
| PREFERRED STOCKS—0.1% | | SHARES | | VALUE |
| ADVERTISING—0.1% | | | | |
| Choicestream, Inc., Cl. A*,@,(a) | | 31,215 | $ | 14,983 |
| Choicestream, Inc., Cl. B*,@,(a) | | 69,819 | | 33,513 |
| | | | | 48,496 |
| TOTAL PREFERRED STOCKS | | | | |
| (Cost $66,853) | | | | 48,496 |
| Total Investments | | | | |
| (Cost $56,199,770)(b) | | 96.6% | | 78,956,521 |
| Other Assets in Excess of Liabilities | | 3.4% | | 2,775,532 |
| NET ASSETS | | 100.0% | $ | 81,732,053 |
# American Depositary Receipts.
(a) Deemed an affiliate of the Alger fund complex during the year for purposes of Section 2(a)(3) of the Investment
Company Act of 1940. See Affiliated Securities in Notes to Financial Statements.
(b) At April 30, 2015, the net unrealized appreciation on investments, based on cost for federal income tax purposes
of $56,216,083, amounted to $22,740,438 which consisted of aggregate gross unrealized appreciation of
$23,573,620 and aggregate gross unrealized depreciation of $833,182.
* Non-income producing security.
@ Restricted security - Investment in security not registered under the Securities Act of 1933. The investment is deemed
to not be liquid and may be sold only to qualified buyers.
| | | | |
| Security | Acquisition Date(s) | Cost | Market Value | % of net assets |
| Choicestream, Inc. | 3/14/2014 | $1,050 | $1,737 | 0.00% |
| Choicestream, Inc., Cl. A | 12/17/2013 | 24,962 | 14,983 | 0.02% |
| Choicestream, Inc., Cl. B | 7/10/2014 | 41,891 | 33,513 | 0.04% |
| Total | | | $50,233 | 0.06% |
| | | | | |
| |
| |
| See Notes to Financial Statements | | | | |
- 34 -
THE ALGER FUNDS II ALGER ANALYST FUND
Schedule of Investments April 30, 2015 (Unaudited)
| | | | | |
| COMMON STOCKS—93.3% | | SHARES | | | VALUE |
| AEROSPACE & DEFENSE—2.6% | | | | | |
| Honeywell International, Inc. | | 2,411 | $ | 243,318 |
| AIRLINES—1.3% | | | | | |
| Spirit Airlines, Inc.* | | 1,728 | | | 118,316 |
| ALTERNATIVE CARRIERS—1.3% | | | | | |
| Level 3 Communications, Inc.* | | 2,094 | | | 117,138 |
| APPAREL ACCESSORIES & LUXURY GOODS—1.7% | | | | | |
| Under Armour, Inc., Cl. A* | | 1,965 | | | 152,386 |
| APPLICATION SOFTWARE—0.7% | | | | | |
| ACI Worldwide, Inc.* | | 2,959 | | | 68,146 |
| ASSET MANAGEMENT & CUSTODY BANKS—0.9% | | | | | |
| WisdomTree Investments, Inc. | | 4,470 | | | 85,109 |
| AUTO PARTS & EQUIPMENT—3.0% | | | | | |
| Delphi Automotive PLC. | | 3,326 | | | 276,058 |
| BIOTECHNOLOGY—5.3% | | | | | |
| Biogen, Inc.* | | 454 | | | 169,764 |
| Gilead Sciences, Inc.* | | 1,001 | | | 100,611 |
| Intercept Pharmaceuticals, Inc.* | | 509 | | | 128,680 |
| United Therapeutics Corp.* | | 576 | | | 91,981 |
| | | | | | 491,036 |
| BREWERS—1.1% | | | | | |
| The Boston Beer Co., Inc., Cl. A* | | 425 | | | 105,315 |
| BUILDING PRODUCTS—1.5% | | | | | |
| Lennox International, Inc. | | 1,339 | | | 141,880 |
| CONSTRUCTION MATERIALS—1.4% | | | | | |
| Vulcan Materials Co. | | 1,526 | | | 130,504 |
| DATA PROCESSING & OUTSOURCED SERVICES—3.0% | | | | | |
| Alliance Data Systems Corp.* | | 284 | | | 84,436 |
| Visa, Inc., Cl. A | | 2,944 | | | 194,451 |
| | | | | | 278,887 |
| EDUCATION SERVICES—1.7% | | | | | |
| Grand Canyon Education, Inc.* | | 3,362 | | | 152,231 |
| ELECTRONIC EQUIPMENT MANUFACTURERS—1.1% | | | | | |
| FEI Co. | | 1,373 | | | 103,607 |
| GENERAL MERCHANDISE STORES—2.4% | | | | | |
| Dollar Tree, Inc.* | | 2,942 | | | 224,798 |
| HEALTH CARE FACILITIES—2.2% | | | | | |
| HCA Holdings, Inc.* | | 1,095 | | | 81,041 |
| Tenet Healthcare Corporation* | | 2,509 | | | 120,081 |
| | | | | | 201,122 |
| HOME IMPROVEMENT RETAIL—1.1% | | | | | |
| The Home Depot, Inc. | | 984 | | | 105,268 |
- 35 -
THE ALGER FUNDS II ALGER ANALYST FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | | VALUE |
| HOMEBUILDING—1.4% | | | | | |
| Toll Brothers, Inc.* | | 3,659 | $ | 130,041 |
| HOTELS RESORTS & CRUISE LINES—4.0% | | | | | |
| Hilton Worldwide Holdings, Inc.* | | 2,318 | | | 67,129 |
| La Quinta Holdings, Inc.* | | 3,873 | | | 93,262 |
| Norwegian Cruise Line Holdings Ltd.* | | 2,640 | | | 128,067 |
| Royal Caribbean Cruises Ltd. | | 1,154 | | | 78,541 |
| | | | | | 366,999 |
| HOUSEWARES & SPECIALTIES—1.9% | | | | | |
| Jarden Corp.* | | 3,392 | | | 173,603 |
| HUMAN RESOURCE & EMPLOYMENT SERVICES—0.6% | | | | | |
| Robert Half International, Inc. | | 1,046 | | | 58,001 |
| INTERNET RETAIL—1.6% | | | | | |
| Amazon.com, Inc.* | | 343 | | | 144,671 |
| INTERNET SOFTWARE & SERVICES—12.7% | | | | | |
| Criteo SA#* | | 3,094 | | | 128,277 |
| DealerTrack Holdings, Inc.* | | 2,716 | | | 106,766 |
| Demandware, Inc.* | | 2,567 | | | 158,127 |
| Facebook, Inc., Cl. A* | | 3,634 | | | 286,250 |
| Google, Inc., Cl. C* | | 318 | | | 170,874 |
| GrubHub, Inc.* | | 3,210 | | | 132,156 |
| LendingClub Corp.* | | 3,913 | | | 68,282 |
| Shutterstock, Inc.* | | 853 | | | 57,569 |
| Yahoo! Inc.* | | 1,637 | | | 69,679 |
| | | | | | 1,177,980 |
| INVESTMENT BANKING & BROKERAGE—1.3% | | | | | |
| TD Ameritrade Holding Corp. | | 3,241 | | | 117,486 |
| MANAGED HEALTH CARE—1.9% | | | | | |
| Cigna Corp. | | 1,380 | | | 172,003 |
| MULTI-LINE INSURANCE—0.7% | | | | | |
| Hartford Financial Services Group, Inc. | | 1,682 | | | 68,575 |
| OIL & GAS EQUIPMENT & SERVICES—4.8% | | | | | |
| Baker Hughes, Inc. | | 2,866 | | | 196,206 |
| US Silica Holdings, Inc. | | 2,047 | | | 76,455 |
| Weatherford International PLC.* | | 12,103 | | | 176,099 |
| | | | | | 448,760 |
| OIL & GAS EXPLORATION & PRODUCTION—3.3% | | | | | |
| Anadarko Petroleum Corp. | | 2,336 | | | 219,818 |
| Oasis Petroleum, Inc.* | | 4,896 | | | 87,834 |
| | | | | | 307,652 |
| PHARMACEUTICALS—4.6% | | | | | |
| Actavis PLC.* | | 601 | | | 169,999 |
| Aerie Pharmaceuticals, Inc.* | | 3,479 | | | 33,538 |
| Pacira Pharmaceuticals, Inc.* | | 752 | | | 51,497 |
| Shire PLC.# | | 716 | | | 174,353 |
| | | | | | 429,387 |
- 36 -
THE ALGER FUNDS II ALGER ANALYST FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | VALUE |
| RESEARCH & CONSULTING SERVICES—2.5% | | | | |
| CoStar Group, Inc.* | | 1,151 | $ | 235,299 |
| RESTAURANTS—4.0% | | | | |
| Bloomin' Brands, Inc. | | 4,990 | | 113,073 |
| Diamond Resorts International, Inc.* | | 4,752 | | 152,112 |
| Jack in the Box, Inc. | | 1,248 | | 108,289 |
| | | | | 373,474 |
| SECURITY & ALARM SERVICES—2.1% | | | | |
| Tyco International PLC. | | 4,839 | | 190,560 |
| SOFT DRINKS—1.6% | | | | |
| PepsiCo, Inc. | | 1,554 | | 147,816 |
| SPECIALTY CHEMICALS—2.4% | | | | |
| The Sherwin-Williams Co. | | 795 | | 221,010 |
| SPECIALTY STORES—5.7% | | | | |
| Signet Jewelers Ltd. | | 824 | | 110,523 |
| The Michaels Cos, Inc.* | | 3,861 | | 99,845 |
| Tiffany & Co. | | 820 | | 71,734 |
| Tractor Supply Co. | | 1,470 | | 126,508 |
| Ulta Salon, Cosmetics & Fragrance, Inc.* | | 773 | | 116,793 |
| | | | | 525,403 |
| SYSTEMS SOFTWARE—1.2% | | | | |
| ServiceNow, Inc.* | | 1,498 | | 112,140 |
| TRADING COMPANIES & DISTRIBUTORS—1.7% | | | | |
| HD Supply Holdings, Inc.* | | 4,879 | | 161,007 |
| TRUCKING—1.0% | | | | |
| Saia, Inc.* | | 2,328 | | 94,866 |
| TOTAL COMMON STOCKS | | | | |
| (Cost $7,736,618) | | | | 8,651,852 |
| MASTER LIMITED PARTNERSHIP—2.8% | | SHARES | | VALUE |
| ASSET MANAGEMENT & CUSTODY BANKS—1.5% | | | | |
| The Blackstone Group LP. | | 3,301 | | 135,209 |
| OIL & GAS STORAGE & TRANSPORTATION—1.3% | | | | |
| Cheniere Energy Partners LP. | | 3,771 | | 122,897 |
| TOTAL MASTER LIMITED PARTNERSHIP | | | | |
| (Cost $238,433) | | | | 258,106 |
| REAL ESTATE INVESTMENT TRUST—1.4% | | SHARES | | VALUE |
| SPECIALIZED—1.4% | | | | |
| Crown Castle International Corp. | | 1,594 | | 133,147 |
| (Cost $138,903) | | | | 133,147 |
| Total Investments | | | | |
| (Cost $8,113,954)(a) | | 97.5% | | 9,043,105 |
| Other Assets in Excess of Liabilities | | 2.5% | | 231,855 |
| NET ASSETS | | 100.0% | $ | 9,274,960 |
- 37 -
THE ALGER FUNDS II ALGER ANALYST FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
# American Depositary Receipts.
(a) At April 30, 2015, the net unrealized appreciation on investments, based on cost for federal income tax purposes
of $8,181,231, amounted to $861,874 which consisted of aggregate gross unrealized appreciation of $1,139,831
and aggregate gross unrealized depreciation of $277,957.
* Non-income producing security.
See Notes to Financial Statements.
- 38 -
THE ALGER FUNDS II ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments April 30, 2015 (Unaudited)
| COMMON STOCKS—62.8% | | SHARES | | | VALUE |
| AEROSPACE & DEFENSE—1.6% | | | | | |
| General Dynamics Corp. | | 2,510 | $ | 344,673 |
| Honeywell International, Inc. | | 7,400 | | | 746,808 |
| Lockheed Martin Corp. | | 1,715 | | | 320,019 |
| | | | | | 1,411,500 |
| AIRLINES—0.8% | | | | | |
| United Continental Holdings, Inc.* | | 11,435 | | | 683,127 |
| ALTERNATIVE CARRIERS—0.4% | | | | | |
| Zayo Group Holdings, Inc.* | | 15,250 | | | 404,888 |
| APPAREL ACCESSORIES & LUXURY GOODS—0.9% | | | | | |
| Moncler SpA | | 24,305 | | | 433,886 |
| Under Armour, Inc., Cl. A* | | 5,435 | | | 421,484 |
| | | | | | 855,370 |
| APPLICATION SOFTWARE—2.9% | | | | | |
| ACI Worldwide, Inc.* | | 18,970 | | | 436,879 |
| Adobe Systems, Inc.* | | 11,340 | | | 862,520 |
| Guidewire Software, Inc.* | | 7,660 | | | 382,617 |
| Mobileye NV* | | 10,010 | | | 449,049 |
| Palantir Technologies, Inc., Cl. A*,@ | | 6,606 | | | 46,969 |
| Synchronoss Technologies, Inc.* | | 8,915 | | | 409,020 |
| | | | | | 2,587,054 |
| ASSET MANAGEMENT & CUSTODY BANKS—0.2% | | | | | |
| WisdomTree Investments, Inc. | | 11,170 | | | 212,677 |
| AUTO PARTS & EQUIPMENT—1.4% | | | | | |
| Delphi Automotive PLC. | | 10,630 | | | 882,290 |
| WABCO Holdings, Inc.* | | 3,060 | | | 380,817 |
| | | | | | 1,263,107 |
| AUTOMOBILE MANUFACTURERS—0.5% | | | | | |
| Tesla Motors, Inc.* | | 1,890 | | | 427,235 |
| BIOTECHNOLOGY—4.7% | | | | | |
| Biogen, Inc.* | | 2,920 | | | 1,091,876 |
| Gilead Sciences, Inc.*+ | | 14,120 | | | 1,419,201 |
| Intercept Pharmaceuticals, Inc.* | | 2,910 | | | 735,677 |
| Pharmacyclics, Inc.* | | 2,010 | | | 514,962 |
| United Therapeutics Corp.* | | 3,140 | | | 501,427 |
| | | | | | 4,263,143 |
| CABLE & SATELLITE—0.5% | | | | | |
| Comcast Corporation, Cl. A+ | | 7,610 | | | 439,554 |
| CASINOS & GAMING—0.2% | | | | | |
| Las Vegas Sands Corp. | | 2,930 | | | 154,938 |
| COMMUNICATIONS EQUIPMENT—0.9% | | | | | |
| Arista Networks, Inc.* | | 3,280 | | | 209,953 |
| Cisco Systems, Inc. | | 20,945 | | | 603,844 |
| | | | | | 813,797 |
- 39 -
THE ALGER FUNDS II ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | | VALUE |
| CONSUMER FINANCE—0.4% | | | | | |
| Discover Financial Services | | 6,425 | $ | 372,457 |
| DATA PROCESSING & OUTSOURCED SERVICES—2.1% | | | | | |
| Alliance Data Systems Corp.* | | 3,550 | | | 1,055,451 |
| Fiserv, Inc.* | | 5,950 | | | 461,720 |
| Visa, Inc., Cl. A | | 6,005 | | | 396,630 |
| | | | | | 1,913,801 |
| DRUG RETAIL—0.9% | | | | | |
| CVS Caremark Corp.+ | | 8,530 | | | 846,944 |
| ELECTRONIC EQUIPMENT MANUFACTURERS—0.4% | | | | | |
| FLIR Systems, Inc. | | 12,250 | | | 378,403 |
| EXCHANGE TRADED FUNDS—0.2% | | | | | |
| ProShares Ultra Bloomberg Crude Oil* | | 15,540 | | | 151,670 |
| GENERAL MERCHANDISE STORES—0.7% | | | | | |
| Dollar Tree, Inc.* | | 8,285 | | | 633,057 |
| HEALTH CARE EQUIPMENT—0.6% | | | | | |
| Becton Dickinson and Co. | | 3,975 | | | 559,958 |
| HEALTH CARE FACILITIES—1.2% | | | | | |
| HCA Holdings, Inc.*+ | | 14,585 | | | 1,079,436 |
| HOME ENTERTAINMENT SOFTWARE—0.5% | | | | | |
| Activision Blizzard, Inc. | | 21,645 | | | 493,831 |
| HOME IMPROVEMENT RETAIL—0.9% | | | | | |
| The Home Depot, Inc.+ | | 7,485 | | | 800,745 |
| HOTELS RESORTS & CRUISE LINES—1.2% | | | | | |
| Hilton Worldwide Holdings, Inc.* | | 15,370 | | | 445,115 |
| Royal Caribbean Cruises Ltd. | | 9,650 | | | 656,779 |
| | | | | | 1,101,894 |
| INDUSTRIAL CONGLOMERATES—0.7% | | | | | |
| Danaher Corp. | | 8,105 | | | 663,637 |
| INDUSTRIAL MACHINERY—0.9% | | | | | |
| Pall Corp. | | 4,010 | | | 390,253 |
| Sun Hydraulics Corp. | | 9,935 | | | 386,571 |
| | | | | | 776,824 |
| INTERNET RETAIL—0.5% | | | | | |
| TripAdvisor, Inc.* | | 2,755 | | | 221,750 |
| Vipshop Holdings Ltd.#* | | 9,630 | | | 272,433 |
| | | | | | 494,183 |
| INTERNET SOFTWARE & SERVICES—9.1% | | | | | |
| Criteo SA#* | | 34,985 | | | 1,450,478 |
| DealerTrack Holdings, Inc.* | | 13,050 | | | 512,995 |
| Demandware, Inc.* | | 10,360 | | | 638,176 |
| Facebook, Inc., Cl. A*+ | | 23,040 | | | 1,814,861 |
| Google, Inc., Cl. C*+ | | 2,842 | | | 1,527,120 |
| GrubHub, Inc.* | | 14,090 | | | 580,085 |
| LinkedIn Corp., Cl. A* | | 2,045 | | | 515,606 |
- 40 -
THE ALGER FUNDS II ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | | VALUE |
| INTERNET SOFTWARE & SERVICES—(CONT.) | | | | | |
| Tencent Holdings Ltd. | | 19,560 | $ | 406,070 |
| Yahoo! Inc.* | | 18,810 | | | 800,648 |
| | | | | | 8,246,039 |
| LIFE SCIENCES TOOLS & SERVICES—0.9% | | | | | |
| Thermo Fisher Scientific, Inc. | | 6,410 | | | 805,609 |
| MANAGED HEALTH CARE—1.8% | | | | | |
| Aetna, Inc. | | 7,705 | | | 823,434 |
| Cigna Corp. | | 3,380 | | | 421,283 |
| Humana, Inc. | | 2,395 | | | 396,612 |
| | | | | | 1,641,329 |
| MOVIES & ENTERTAINMENT—1.2% | | | | | |
| Lions Gate Entertainment Corp. | | 24,105 | | | 747,496 |
| Rentrak Corp.* | | 6,260 | | | 296,724 |
| | | | | | 1,044,220 |
| MULTI-LINE INSURANCE—1.0% | | | | | |
| Hartford Financial Services Group, Inc. | | 21,085 | | | 859,635 |
| MULTI-UTILITIES—0.5% | | | | | |
| Sempra Energy | | 4,440 | | | 471,395 |
| OIL & GAS EXPLORATION & PRODUCTION—1.3% | | | | | |
| Anadarko Petroleum Corp. | | 10,520 | | | 989,932 |
| iPath Goldman Sachs Crude Oil Total Return Index* | | 13,780 | | | 171,699 |
| | | | | | 1,161,631 |
| OTHER DIVERSIFIED FINANCIAL SERVICES—1.6% | | | | | |
| Bank of America Corp. | | 60,565 | | | 964,801 |
| Citigroup, Inc. | | 8,295 | | | 442,289 |
| | | | | | 1,407,090 |
| PHARMACEUTICALS—3.8% | | | | | |
| Actavis PLC.*+ | | 10,092 | | | 2,854,623 |
| Bristol-Myers Squibb Co. | | 8,700 | | | 554,451 |
| | | | | | 3,409,074 |
| RAILROADS—0.5% | | | | | |
| Union Pacific Corp. | | 4,050 | | | 430,232 |
| REAL ESTATE SERVICES—0.5% | | | | | |
| Jones Lang LaSalle, Inc. | | 2,715 | | | 450,853 |
| RENEWABLE ELECTRICITY—0.4% | | | | | |
| TerraForm Power, Inc., Cl. A | | 9,825 | | | 388,382 |
| RESTAURANTS—0.6% | | | | | |
| Bloomin' Brands, Inc. | | 9,075 | | | 205,640 |
| Shake Shack, Inc., Cl. A* | | 4,380 | | | 301,125 |
| | | | | | 506,765 |
| SECURITY & ALARM SERVICES—0.4% | | | | | |
| Tyco International PLC. | | 9,550 | | | 376,079 |
| SEMICONDUCTOR EQUIPMENT—0.7% | | | | | |
| SunEdison, Inc.* | | 24,510 | | | 620,593 |
- 41 -
THE ALGER FUNDS II ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | | VALUE |
| SEMICONDUCTORS—4.0% | | | | | |
| Altera Corp. | | 9,485 | $ | 395,335 |
| Avago Technologies Ltd. | | 8,780 | | | 1,026,206 |
| Broadcom Corp., Cl. A | | 11,150 | | | 492,886 |
| Micron Technology, Inc.* | | 22,330 | | | 628,143 |
| NXP Semiconductors NV*+ | | 11,530 | | | 1,108,263 |
| | | | | | 3,650,833 |
| SOFT DRINKS—1.2% | | | | | |
| PepsiCo, Inc. | | 11,570 | | | 1,100,538 |
| SPECIALTY CHEMICALS—1.3% | | | | | |
| Ecolab, Inc. | | 3,665 | | | 410,407 |
| PPG Industries, Inc. | | 2,715 | | | 601,535 |
| Senomyx, Inc.* | | 20,890 | | | 120,953 |
| | | | | | 1,132,895 |
| SYSTEMS SOFTWARE—2.7% | | | | | |
| Gigamon, Inc.* | | 8,980 | | | 264,281 |
| Oracle Corp. | | 26,010 | | | 1,134,556 |
| ServiceNow, Inc.* | | 2,930 | | | 219,340 |
| TubeMogul, Inc.* | | 60,025 | | | 864,360 |
| | | | | | 2,482,537 |
| TECHNOLOGY HARDWARE STORAGE & PERIPHERALS—2.4% | | | | | |
| Apple, Inc.+ | | 14,695 | | | 1,839,079 |
| Nimble Storage, Inc.* | | 14,285 | | | 349,411 |
| | | | | | 2,188,490 |
| TRADING COMPANIES & DISTRIBUTORS—0.7% | | | | | |
| HD Supply Holdings, Inc.*+ | | 18,560 | | | 612,480 |
| TOTAL COMMON STOCKS | | | | | |
| (Cost $50,660,549) | | | | | 56,769,929 |
| PREFERRED STOCKS—1.0% | | SHARES | | | VALUE |
| APPLICATION SOFTWARE—0.3% | | | | | |
| Palantir Technologies, Inc., Cl. B*,@ | | 26,941 | | | 191,551 |
| Palantir Technologies, Inc., Cl. D*,@ | | 3,510 | | | 24,956 |
| | | | | | 216,507 |
| BIOTECHNOLOGY—0.2% | | | | | |
| Prosetta Biosciences, Inc.*,@,(a) | | 41,418 | | | 186,381 |
| PHARMACEUTICALS—0.5% | | | | | |
| Intarcia Therapeutics, Inc.*,@ | | 2,964 | | | 130,415 |
| Tolero Pharmaceuticals, Inc.*,@,(a) | | 106,120 | | | 320,069 |
| | | | | | 450,484 |
| TOTAL PREFERRED STOCKS | | | | | |
| (Cost $803,533) | | | | | 853,372 |
| RIGHTS—0.0% | | SHARES | | | VALUE |
| BIOTECHNOLOGY—0.0% | | | | | |
| Adolor Corp., CPR, 12/31/2049*,@,(b) | | 49,870 | | | 25,932 |
| (Cost $–) | | | | | 25,932 |
- 42 -
THE ALGER FUNDS II ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | |
| MASTER LIMITED PARTNERSHIP—2.7% | | SHARES | | VALUE |
| ASSET MANAGEMENT & CUSTODY BANKS—2.0% | | | | |
| The Blackstone Group LP.+ | | 44,085 | $ | 1,805,721 |
| OIL & GAS STORAGE & TRANSPORTATION—0.7% | | | | |
| Cheniere Energy Partners LP. | | 20,030 | | 652,778 |
| TOTAL MASTER LIMITED PARTNERSHIP | | | | |
| (Cost $1,995,486) | | | | 2,458,499 |
| REAL ESTATE INVESTMENT TRUST—0.9% | | SHARES | | VALUE |
| MORTGAGE—0.4% | | | | |
| Blackstone Mortgage Trust, Inc., Cl. A | | 10,970 | | 337,108 |
| SPECIALIZED—0.5% | | | | |
| Crown Castle International Corp. | | 5,120 | | 427,674 |
| TOTAL REAL ESTATE INVESTMENT TRUST | | | | |
| (Cost $774,603) | | | | 764,782 |
| U.S. GOVERNMENT AGENCY OBLIGATIONS (EXCLUDING | | | | |
| MORTGAGE-BACKED)—27.7% | | SHARES | | VALUE |
| (Cost $24,999,861) | | | | 24,999,861 |
| Total Investments | | | | |
| (Cost $79,234,032)(c) | | 95.1% | | 85,872,375 |
| Other Assets in Excess of Liabilities | | 4.9% | | 4,463,019 |
| NET ASSETS | | 100.0% | $ | 90,335,394 |
# American Depositary Receipts.
(a) Deemed an affiliate of the Alger fund complex during the year for purposes of Section 2(a)(3) of the Investment
Company Act of 1940. See Affiliated Securities in Notes to Financial Statements.
(b) Right - Contingent Payment Right granted December 13, 2011 and may not be sold. Right is deemed to be illiquid
and represents 0.0% of the net assets of the Fund.
(c) At April 30, 2015, the net unrealized appreciation on investments, based on cost for federal income tax purposes
of $79,578,458, amounted to $6,293,917 which consisted of aggregate gross unrealized appreciation of
$7,475,478 and aggregate gross unrealized depreciation of $1,181,561.
* Non-income producing security.
@ Restricted security - Investment in security not registered under the Securities Act of 1933. The investment is deemed
to not be liquid and may be sold only to qualified buyers.
| | | | |
| Security | Acquisition Date(s) | Cost | Market Value | % of net assets |
| Adolor Corp., CPR | 10/24/2011 | $– | $25,932 | 0.03% |
| Intarcia Therapeutics, Inc. | 3/27/2014 | 96,004 | 130,415 | 0.15% |
| Palantir Technologies, Inc., Cl. A | 10/07/2014 | 42,985 | 46,969 | 0.05% |
| Palantir Technologies, Inc., Cl. B | 10/07/2014 | 177,903 | 191,551 | 0.21% |
| Palantir Technologies, Inc., Cl. D | 10/14/2014 | 23,176 | 24,956 | 0.03% |
| Prosetta Biosciences, Inc. | 2/06/20150 | 186,381 | 186,381 | 0.21% |
| Tolero Pharmaceuticals, Inc. | 8/01/2014 | 154,147 | 154,147 | 0.35% |
| Tolero Pharmaceuticals, Inc. | 10/31/2014 | 165,922 | 165,922 | 0.35% |
| Total | | | $926,273 | 1.03% |
| | | | | |
| + All or a portion of this security is held as collateral for securities sold short. | | |
| |
| See Notes to Financial Statements. | | | | |
- 43 -
THE ALGER FUNDS II ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments- Securities Sold Short April 30, 2015 (Unaudited)
| | | | | |
| COMMON STOCKS—-12.4% | | SHARES | | | VALUE |
| AGRICULTURAL & FARM MACHINERY—-0.2% | | | | | |
| Deere & Co. | | (2,190) | $ | (198,239) |
| APPAREL RETAIL—-0.3% | | | | | |
| The Gap, Inc. | | (6,590) | | | (261,228) |
| APPLICATION SOFTWARE—-0.3% | | | | | |
| King Digital Entertainment, PLC. | | (3,985) | | | (63,202) |
| Workday, Inc., Cl. A* | | (1,865) | | | (170,107) |
| | | | | | (233,309) |
| ASSET MANAGEMENT & CUSTODY BANKS—-0.2% | | | | | |
| T. Rowe Price Group, Inc. | | (2,070) | | | (168,043) |
| BIOTECHNOLOGY—-0.1% | | | | | |
| Myriad Genetics, Inc.* | | (3,920) | | | (129,478) |
| BROADCASTING—-0.4% | | | | | |
| Scripps Networks Interactive, Inc., Cl. A | | (4,615) | | | (322,404) |
| COMMUNICATIONS EQUIPMENT—-0.2% | | | | | |
| Polycom, Inc.* | | (14,000) | | | (182,700) |
| CONSTRUCTION & FARM MACHINERY & HEAVY TRUCKS—-0.8% | | | | | |
| Cummins, Inc. | | (2,340) | | | (323,528) |
| PACCAR, Inc. | | (5,780) | | | (377,723) |
| | | | | | (701,251) |
| CONSUMER FINANCE—-0.2% | | | | | |
| Capital One Financial Corp. | | (1,940) | | | (156,849) |
| DIVERSIFIED BANKS—-0.2% | | | | | |
| SPDR S&P Regional Banking ETF | | (5,411) | | | (222,446) |
| DIVERSIFIED CHEMICALS—-0.2% | | | | | |
| FMC Corporation | | (3,620) | | | (214,702) |
| ELECTRICAL COMPONENTS & EQUIPMENT—-0.2% | | | | | |
| Emerson Electric Co. | | (3,010) | | | (177,078) |
| HEALTH CARE EQUIPMENT—-1.1% | | | | | |
| Baxter International, Inc. | | (7,080) | | | (486,679) |
| Varian Medical Systems, Inc.* | | (6,080) | | | (540,208) |
| | | | | | (1,026,887) |
| HEALTH CARE FACILITIES—-0.2% | | | | | |
| Community Health Systems, Inc.* | | (3,885) | | | (208,547) |
| HEALTH CARE SUPPLIES—-0.1% | | | | | |
| DENTSPLY International, Inc. | | (1,805) | | | (92,055) |
| HOME FURNISHING RETAIL—-0.3% | | | | | |
| Bed Bath & Beyond, Inc.* | | (3,200) | | | (225,472) |
| HOUSEWARES & SPECIALTIES—-0.4% | | | | | |
| Tupperware Brands Corp. | | (5,300) | | | (354,358) |
| INSURANCE BROKERS—-0.2% | | | | | |
| Aon PLC. | | (2,040) | | | (196,309) |
| INTEGRATED OIL & GAS—-0.2% | | | | | |
| Statoil ASA# | | (8,775) | | | (186,293) |
- 44 -
THE ALGER FUNDS II ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments- Securities Sold Short April 30, 2015 (Unaudited) (Continued)
| | | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | | VALUE |
| INTERNET SOFTWARE & SERVICES—-0.6% | | | | | |
| Twitter, Inc.* | | (4,560) | $ | (177,658) |
| Zillow Group, Inc., Cl. A* | | (3,810) | | | (372,008) |
| | | | | | (549,666) |
| IT CONSULTING & OTHER SERVICES—-0.4% | | | | | |
| Accenture PLC., Cl. A | | (4,260) | | | (394,689) |
| LIFE & HEALTH INSURANCE—-0.2% | | | | | |
| MetLife, Inc. | | (4,020) | | | (206,186) |
| MARKET INDICES—-1.6% | | | | | |
| iShares Russell 2000 Growth | | (4,728) | | | (695,252) |
| iShares Russell 2000 Index Fund | | (2,468) | | | (299,023) |
| SPDR S&P 500 ETF Trust | | (2,073) | | | (432,262) |
| | | | | | (1,426,537) |
| REGIONAL BANKS—-0.5% | | | | | |
| Cullen/Frost Bankers, Inc. | | (2,470) | | | (180,162) |
| Hancock Holding Co. | | (8,100) | | | (235,791) |
| | | | | | (415,953) |
| RESTAURANTS—-1.0% | | | | | |
| Buffalo Wild Wings, Inc.* | | (1,005) | | | (160,096) |
| Dunkin' Brands Group, Inc. | | (8,155) | | | (424,957) |
| Yum! Brands, Inc. | | (2,880) | | | (247,565) |
| | | | | | (832,618) |
| SEMICONDUCTORS—-1.3% | | | | | |
| Linear Technology Corp. | | (10,060) | | | (464,068) |
| Taiwan Semiconductor Manufacturing Co., Ltd.# | | (8,770) | | | (214,339) |
| Texas Instruments, Inc. | | (10,215) | | | (553,755) |
| | | | | | (1,232,162) |
| SPECIALTY CHEMICALS—-0.2% | | | | | |
| Celanese Corp. | | (2,625) | | | (174,195) |
| SYSTEMS SOFTWARE—-0.6% | | | | | |
| FireEye, Inc.* | | (4,225) | | | (174,492) |
| NetSuite, Inc.* | | (3,580) | | | (342,141) |
| | | | | | (516,633) |
| TOBACCO—-0.2% | | | | | |
| Philip Morris International, Inc. | | (2,335) | | | (194,902) |
| TOTAL Common Stocks | | | $ (11,201,189) |
| (Proceeds $10,592,218) | | | | | |
| REAL ESTATE INVESTMENT TRUST—-0.2% | | SHARES | | | VALUE |
| MORTGAGE REITS—-0.2% | | | | | |
| Annaly Capital Management, Inc. | | (17,670) | | | (177,937) |
| (Proceeds $193,795) | | | | | |
| TOTAL (Proceeds $10,786,013) | | | $ (11,379,126) |
- 45 -
THE ALGER FUNDS II ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments- Securities Sold Short April 30, 2015 (Unaudited) (Continued)
* Non-income producing security.
# American Depositary Receipts.
See Notes to Financial Statements.
- 46 -
THE ALGER FUNDS II ALGER EMERGING MARKETS FUND
Schedule of Investments April 30, 2015 (Unaudited)
| | | | | |
| COMMON STOCKS—96.8% | | SHARES | | | VALUE |
| BRAZIL—7.2% | | | | | |
| APPAREL ACCESSORIES & LUXURY GOODS—0.2% | | | | | |
| Restoque Comercio e Confeccoes de Roupas SA | | 22,600 | $ | 66,862 |
| BREWERS—0.9% | | | | | |
| Ambev SA | | 38,635 | | | 243,242 |
| DIVERSIFIED BANKS—1.9% | | | | | |
| Banco Bradesco SA# | | 8,620 | | | 92,148 |
| Itau Unibanco Holding SA# | | 32,493 | | | 416,560 |
| | | | | | 508,708 |
| DIVERSIFIED COMMERCIAL & PROFESSIONAL SERVICES—0.9% | | | | | |
| Cielo SA | | 16,290 | | | 227,106 |
| INDUSTRIAL MACHINERY—1.0% | | | | | |
| WEG SA | | 48,828 | | | 260,509 |
| MANAGED HEALTH CARE—0.6% | | | | | |
| Odontoprev SA | | 48,484 | | | 169,226 |
| MULTI-LINE INSURANCE—0.7% | | | | | |
| BB Seguridade Participacoes SA | | 16,000 | | | 187,481 |
| PAPER PRODUCTS—1.0% | | | | | |
| Suzano Papel e Celulose SA | | 53,481 | | | 268,445 |
| TOTAL BRAZIL | | | | | |
| (Cost $1,912,430) | | | | | 1,931,579 |
| CHILE—0.9% | | | | | |
| BREWERS—0.9% | | | | | |
| Cia Cervecerias Unidas SA# | | 10,600 | | | 231,822 |
| (Cost $218,627) | | | | | |
| CHINA—24.6% | | | | | |
| ALUMINUM—1.0% | | | | | |
| China Hongqiao Group Ltd. | | 279,500 | | | 261,094 |
| APPAREL ACCESSORIES & LUXURY GOODS—0.7% | | | | | |
| Li Ning Co., Ltd.* | | 325,500 | | | 180,591 |
| AUTOMOBILE MANUFACTURERS—0.8% | | | | | |
| Brilliance China Automotive Holdings Ltd. | | 107,610 | | | 202,713 |
| CONSTRUCTION & ENGINEERING—1.7% | | | | | |
| China Communications Construction Co., Ltd. | | 91,206 | | | 166,869 |
| China State Construction International Holdings Ltd. | | 153,568 | | | 299,194 |
| | | | | | 466,063 |
| CONSTRUCTION & FARM MACHINERY & HEAVY TRUCKS—0.5% | | | | | |
| China South Locomotive and Rolling Stock Corp. | | 65,000 | | | 125,968 |
| CONSTRUCTION MATERIALS—0.5% | | | | | |
| Anhui Conch Cement Co., Ltd. | | 31,361 | | | 127,663 |
| CONSUMER ELECTRONICS—0.9% | | | | | |
| Haier Electronics Group Co., Ltd. | | 84,000 | | | 240,607 |
| ELECTRONIC EQUIPMENT & INSTRUMENTS—1.0% | | | | | |
| PAX Global Technology Ltd.* | | 188,145 | | | 274,313 |
- 47 -
THE ALGER FUNDS II ALGER EMERGING MARKETS FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | | VALUE |
| CHINA—(CONT.) | | | | | |
| HEALTH CARE DISTRIBUTORS—0.9% | | | | | |
| Phoenix Healthcare Group Co., Ltd. | | 119,913 | $ | 248,168 |
| INDEPENDENT POWER PRODUCERS & ENERGY TRADERS—1.8% | | | | |
| Huadian Power International Corp., Ltd. | | 186,000 | | | 206,630 |
| Huaneng Renewables Corp., Ltd. | | 601,760 | | | 263,984 |
| | | | | | 470,614 |
| INDUSTRIAL CONGLOMERATES—1.3% | | | | | |
| China Everbright International Ltd. | | 182,299 | | | 341,528 |
| INTEGRATED OIL & GAS—1.1% | | | | | |
| China Petroleum & Chemical Corp. | | 307,423 | | | 289,558 |
| INTERNET RETAIL—1.3% | | | | | |
| Qunar Cayman Islands Ltd.#* | | 2,709 | | | 126,862 |
| Vipshop Holdings Ltd.#* | | 8,268 | | | 233,902 |
| | | | | | 360,764 |
| INTERNET SOFTWARE & SERVICES—3.7% | | | | | |
| Alibaba Group Holding Ltd.#* | | 2,089 | | | 169,815 |
| Tencent Holdings Ltd. | | 39,807 | | | 826,402 |
| | | | | | 996,217 |
| INVESTMENT BANKING & BROKERAGE—0.6% | | | | | |
| Haitong Securities Co., Ltd. | | 52,448 | | | 172,224 |
| LIFE & HEALTH INSURANCE—3.3% | | | | | |
| China Life Insurance Co., Ltd. | | 95,047 | | | 463,560 |
| Ping An Insurance Group Co., of China Ltd. | | 29,116 | | | 420,000 |
| | | | | | 883,560 |
| REAL ESTATE DEVELOPMENT—1.2% | | | | | |
| China Overseas Land & Investment Ltd. | | 75,033 | | | 313,670 |
| WIRELESS TELECOMMUNICATION SERVICES—2.3% | | | | | |
| China Mobile Ltd. | | 42,230 | | | 602,087 |
| TOTAL CHINA | | | | | |
| (Cost $4,896,468) | | | | | 6,557,402 |
| COLOMBIA—0.8% | | | | | |
| CONSTRUCTION MATERIALS—0.8% | | | | | |
| Cementos Argos SA | | 56,997 | | | 215,354 |
| (Cost $245,543) | | | | | |
| EGYPT—0.5% | | | | | |
| DIVERSIFIED BANKS—0.5% | | | | | |
| Commercial International Bank Egypt SAE(a) | | 19,931 | | | 137,524 |
| (Cost $134,819) | | | | | |
| HONG KONG—1.6% | | | | | |
| LIFE & HEALTH INSURANCE—1.0% | | | | | |
| AIA Group Ltd. | | 40,295 | | | 269,313 |
- 48 -
THE ALGER FUNDS II ALGER EMERGING MARKETS FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | | VALUE |
| HONG KONG—(CONT.) | | | | | |
| MULTI-LINE INSURANCE—0.6% | | | | | |
| China Taiping Insurance Holdings Co., Ltd.* | | 45,400 | $ | 170,168 |
| TOTAL HONG KONG | | | | | |
| (Cost $352,272) | | | | | 439,481 |
| INDIA—9.9% | | | | | |
| AIR FREIGHT & LOGISTICS—0.4% | | | | | |
| Blue Dart Express Ltd. | | 1,077 | | | 97,620 |
| APPAREL ACCESSORIES & LUXURY GOODS—0.9% | | | | | |
| Titan Co., Ltd. | | 38,639 | | | 237,132 |
| AUTO PARTS & EQUIPMENT—1.3% | | | | | |
| Motherson Sumi Systems Ltd. | | 44,381 | | | 353,385 |
| CONSTRUCTION & ENGINEERING—0.7% | | | | | |
| Voltas Ltd. | | 43,557 | | | 191,850 |
| CONSTRUCTION & FARM MACHINERY & HEAVY TRUCKS—0.8% | | | | | |
| Tata Motors Ltd.# | | 5,440 | | | 224,073 |
| CONSUMER FINANCE—0.5% | | | | | |
| Shriram Transport Finance Co., Ltd. | | 8,512 | | | 131,268 |
| DIVERSIFIED BANKS—2.7% | | | | | |
| Axis Bank Ltd. | | 29,843 | | | 267,681 |
| HDFC Bank Ltd. | | 15,420 | | | 274,209 |
| IndusInd Bank Ltd. | | 13,932 | | | 181,375 |
| | | | | | 723,265 |
| OIL, GAS & CONSUMABLE FUELS—0.7% | | | | | |
| Reliance Industries Ltd. | | 13,041 | | | 177,512 |
| PHARMACEUTICALS—1.4% | | | | | |
| Aurobindo Pharma Ltd. | | 18,789 | | | 380,229 |
| WIRELESS TELECOMMUNICATION SERVICES—0.5% | | | | | |
| Bharti Infratel Ltd. | | 21,500 | | | 135,331 |
| TOTAL INDIA | | | | | |
| (Cost $2,091,367) | | | | | 2,651,665 |
| INDONESIA—2.4% | | | | | |
| ALTERNATIVE CARRIERS—0.9% | | | | | |
| Tower Bersama Infrastructure Tbk PT | | 374,812 | | | 245,056 |
| CONSTRUCTION & FARM MACHINERY & HEAVY TRUCKS—0.6% | | | | | |
| United Tractors Tbk PT | | 102,700 | | | 169,549 |
| DIVERSIFIED BANKS—0.9% | | | | | |
| Bank Rakyat Indonesia Persero Tbk., PT | | 261,000 | | | 234,069 |
| TOTAL INDONESIA | | | | | |
| (Cost $601,923) | | | | | 648,674 |
| MALAYSIA—1.4% | | | | | |
| HEALTH CARE DISTRIBUTORS—0.7% | | | | | |
| KPJ Healthcare Bhd. | | 154,273 | | | 184,478 |
- 49 -
THE ALGER FUNDS II ALGER EMERGING MARKETS FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | | VALUE |
| MALAYSIA—(CONT.) | | | | | |
| WIRELESS TELECOMMUNICATION SERVICES—0.7% | | | | | |
| Axiata Group Bhd. | | 93,200 | $ | 176,328 |
| TOTAL MALAYSIA | | | | | |
| (Cost $366,945) | | | | | 360,806 |
| MEXICO—5.1% | | | | | |
| AGRICULTURAL PRODUCTS—0.8% | | | | | |
| Gruma SAB de CV | | 17,100 | | | 206,010 |
| CONSTRUCTION MATERIALS—0.9% | | | | | |
| Cemex SAB de CV#* | | 25,872 | | | 248,889 |
| DIVERSIFIED REAL ESTATE ACTIVITIES—1.3% | | | | | |
| Corporacion Inmobiliaria Vesta SAB de CV | | 190,881 | | | 358,343 |
| GAS UTILITIES—1.2% | | | | | |
| Infraestructura Energetica Nova SAB de CV | | 52,800 | | | 308,173 |
| RESTAURANTS—0.9% | | | | | |
| Alsea SAB de CV* | | 75,700 | | | 227,478 |
| TOTAL MEXICO | | | | | |
| (Cost $1,298,425) | | | | | 1,348,893 |
| PERU—1.0% | | | | | |
| DIVERSIFIED BANKS—1.0% | | | | | |
| Credicorp Ltd. | | 1,773 | | | 270,471 |
| (Cost $242,120) | | | | | |
| PHILIPPINES—1.2% | | | | | |
| PACKAGED FOODS & MEATS—1.2% | | | | | |
| Universal Robina Corp. | | 66,911 | | | 326,644 |
| (Cost $267,932) | | | | | |
| POLAND—0.2% | | | | | |
| AIR FREIGHT & LOGISTICS—0.2% | | | | | |
| Integer.pl SA* | | 1,488 | | | 61,982 |
| (Cost $98,556) | | | | | |
| RUSSIA—3.5% | | | | | |
| DATA PROCESSING & OUTSOURCED SERVICES—0.6% | | | | | |
| QIWI PLC.# | | 6,200 | | | 168,268 |
| FOOD RETAIL—1.2% | | | | | |
| Magnit PJSC(a) | | 2,999 | | | 165,395 |
| X5 Retail Group NV*,(a) | | 7,061 | | | 144,044 |
| | | | | | 309,439 |
| IT CONSULTING & OTHER SERVICES—1.7% | | | | | |
| Luxoft Holding, Inc.* | | 8,854 | | | 458,903 |
| TOTAL RUSSIA | | | | | |
| (Cost $722,788) | | | | | 936,610 |
| SOUTH AFRICA—6.3% | | | | | |
| APPAREL RETAIL—0.9% | | | | | |
| Mr Price Group Ltd. | | 10,894 | | | 232,712 |
- 50 -
THE ALGER FUNDS II ALGER EMERGING MARKETS FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | | VALUE |
| SOUTH AFRICA—(CONT.) | | | | | |
| CABLE & SATELLITE—1.8% | | | | | |
| Naspers Ltd. | | 3,047 | $ | 478,817 |
| CASINOS & GAMING—0.5% | | | | | |
| Sun International Ltd. | | 11,981 | | | 133,228 |
| OTHER DIVERSIFIED FINANCIAL SERVICES—2.2% | | | | | |
| Brait SE* | | 29,298 | | | 222,814 |
| FirstRand Ltd. | | 75,394 | | | 359,857 |
| | | | | | 582,671 |
| PHARMACEUTICALS—0.9% | | | | | |
| Aspen Pharmacare Holdings Ltd. | | 8,271 | | | 251,468 |
| TOTAL SOUTH AFRICA | | | | | |
| (Cost $1,323,262) | | | | | 1,678,896 |
| SOUTH KOREA—14.7% | | | | | |
| AUTOMOBILE MANUFACTURERS—0.9% | | | | | |
| Hyundai Motor Co. | | 1,540 | | | 241,628 |
| BUILDING PRODUCTS—1.0% | | | | | |
| KCC Corp. | | 514 | | | 262,462 |
| COMMODITY CHEMICALS—0.8% | | | | | |
| Lotte Chemical Corp. | | 868 | | | 202,271 |
| CONSTRUCTION & FARM MACHINERY & HEAVY TRUCKS—0.5% | | | | | |
| Hyundai Mipo Dockyard Co., Ltd.* | | 1,615 | | | 134,195 |
| DIVERSIFIED BANKS—1.0% | | | | | |
| KB Financial Group, Inc. | | 6,945 | | | 264,038 |
| FOOD BEVERAGE & TOBACCO—1.0% | | | | | |
| CJ CheilJedang Corp. | | 714 | | | 277,417 |
| HOME FURNISHINGS—0.6% | | | | | |
| Hanssem Co., Ltd. | | 813 | | | 149,827 |
| HOUSEHOLD PRODUCTS—0.7% | | | | | |
| LG Household & Health Care Ltd. | | 243 | | | 177,776 |
| INTERNET SOFTWARE & SERVICES—1.2% | | | | | |
| NAVER Corp. | | 511 | | | 308,371 |
| MOVIES & ENTERTAINMENT—1.1% | | | | | |
| CJ CGV Co., Ltd. | | 4,101 | | | 302,308 |
| PROPERTY & CASUALTY INSURANCE—0.8% | | | | | |
| Hyundai Marine & Fire Insurance Co., Ltd. | | 8,314 | | | 220,758 |
| SEMICONDUCTORS—5.1% | | | | | |
| Eo Technics Co., Ltd. | | 1,306 | | | 134,224 |
| Samsung Electronics Co., Ltd. | | 943 | | | 1,234,442 |
| | | | | | 1,368,666 |
| TOTAL SOUTH KOREA | | | | | |
| (Cost $3,594,796) | | | | | 3,909,717 |
| TAIWAN—10.3% | | | | | |
| COMPUTER HARDWARE—0.7% | | | | | |
| Pegatron Corp. | | 57,000 | | | 169,924 |
- 51 -
THE ALGER FUNDS II ALGER EMERGING MARKETS FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | | VALUE |
| TAIWAN—(CONT.) | | | | | |
| COMPUTER STORAGE & PERIPHERALS—0.8% | | | | | |
| Primax Electronics Ltd. | | 167,000 | $ | 221,387 |
| DEPARTMENT STORES—0.7% | | | | | |
| Poya International Co., Ltd. | | 18,000 | | | 193,071 |
| DIVERSIFIED BANKS—1.8% | | | | | |
| E.Sun Financial Holding Co., Ltd. | | 406,100 | | | 278,459 |
| SinoPac Financial Holdings Co., Ltd. | | 461,500 | | | 209,458 |
| | | | | | 487,917 |
| ELECTRONIC EQUIPMENT & INSTRUMENTS—1.1% | | | | | |
| TPK Holding Co., Ltd. | | 44,200 | | | 275,655 |
| ELECTRONIC EQUIPMENT MANUFACTURERS—1.1% | | | | | |
| Chroma ATE, Inc. | | 118,900 | | | 287,292 |
| SEMICONDUCTORS—3.4% | | | | | |
| ASPEED Technology, Inc. | | 21,900 | | | 201,652 |
| eMemory Technology, Inc. | | 17,000 | | | 193,447 |
| Taiwan Semiconductor Manufacturing Co., Ltd. | | 107,100 | | | 514,063 |
| | | | | | 909,162 |
| TEXTILES—0.7% | | | | | |
| Eclat Textile Co., Ltd. | | 14,320 | | | 192,642 |
| TOTAL TAIWAN | | | | | |
| (Cost $2,568,451) | | | | | 2,737,050 |
| THAILAND—1.8% | | | | | |
| CATALOG RETAIL—0.4% | | | | | |
| COL PCL | | 62,500 | | | 112,655 |
| CONSTRUCTION MATERIALS—0.7% | | | | | |
| The Siam Cement PC | | 11,200 | | | 182,539 |
| OIL & GAS EXPLORATION & PRODUCTION—0.7% | | | | | |
| PTT Exploration & Production PCL | | 55,600 | | | 197,067 |
| TOTAL THAILAND | | | | | |
| (Cost $494,839) | | | | | 492,261 |
| TURKEY—1.4% | | | | | |
| DIVERSIFIED BANKS—0.6% | | | | | |
| Turkiye Is Bankasi | | 71,711 | | | 161,540 |
| FOOD RETAIL—0.8% | | | | | |
| Migros Ticaret AS* | | 25,564 | | | 204,711 |
| TOTAL TURKEY | | | | | |
| (Cost $420,911) | | | | | 366,251 |
| UNITED ARAB EMIRATES—0.7% | | | | | |
| DIVERSIFIED BANKS—0.7% | | | | | |
| Abu Dhabi Commercial Bank PJSC | | 93,548 | | | 190,257 |
| (Cost $194,945) | | | | | |
| UNITED KINGDOM—1.3% | | | | | |
| AIRLINES—0.7% | | | | | |
| Wizz Air Holdings Plc.*(b) | | 9,083 | | | 198,744 |
- 52 -
THE ALGER FUNDS II ALGER EMERGING MARKETS FUND
Schedule of Investments April 30, 2015 (Unaudited) (Continued)
| | | | |
| COMMON STOCKS—(CONT.) | | SHARES | | VALUE |
| UNITED KINGDOM—(CONT.) | | | | |
| BREWERS—0.6% | | | | |
| SABMiller PLC. | | 2,817 | $ | 149,792 |
| TOTAL UNITED KINGDOM | | | | |
| (Cost $312,706) | | | | 348,536 |
| TOTAL COMMON STOCKS | | | | |
| (Cost $22,360,125) | | | 25,841,875 |
| Total Investments | | | | |
| (Cost $22,360,125)(c) | | 96.8% | | 25,841,875 |
| Other Assets in Excess of Liabilities | | 3.2% | | 851,960 |
| NET ASSETS | | 100.0% | $ | 26,693,835 |
# American Depositary Receipts.
(a) Global Depositary Receipts.
(b) Pursuant to Securities and Exchange Commission Rule 144A, these securities may be sold prior to their maturity
only to qualified institutional buyers. These securities are however deemed to be liquid and represent 0.7% of the
net assets of the Portfolio.
(c) At April 30, 2015, the net unrealized appreciation on investments, based on cost for federal income tax purposes
of $22,454,995, amounted to $3,386,880 which consisted of aggregate gross unrealized appreciation of
$4,615,015 and aggregate gross unrealized depreciation of $1,228,135.
* Non-income producing security.
See Notes to Financial Statements.
- 53 -
THE ALGER FUNDS II
Statement of Assets and Liabilities April 30, 2015 (Unaudited)
| | | | |
| | Alger Spectra Fund | Alger Green Fund |
| |
| ASSETS: | | | | |
| Investments in securities, at value (Identified cost below)* | | | | |
| see accompanying schedules of investments | $ | 5,163,880,660 | $ | 78,906,288 |
| Investments in affiliated securities, at value (Identified cost | | | | |
| below)** see accompanying schedules of investments | | 15,735,106 | | 50,233 |
| Cash and cash equivalents | | 3,229,277 | | 3,249,284 |
| Receivable for investment securities sold | | 102,794,843 | | 1,042,932 |
| Receivable for shares of beneficial interest sold | | 19,201,873 | | 70,218 |
| Dividends and interest receivable | | 4,223,260 | | 29,704 |
| Prepaid expenses | | 254,687 | | 38,886 |
| Total Assets | | 5,309,319,706 | | 83,387,545 |
| |
| LIABILITIES: | | | | |
| Securities sold short, at value ‡ | | 181,457,295 | | — |
| Payable for investment securities purchased | | 98,625,727 | | 1,341,226 |
| Payable for shares of beneficial interest redeemed | | 5,087,372 | | 178,388 |
| Accrued investment advisory fees | | 3,300,173 | | 48,076 |
| Accrued transfer agent fees | | 1,109,600 | | 26,652 |
| Accrued distribution fees | | 1,322,854 | | 20,447 |
| Accrued administrative fees | | 115,281 | | 1,862 |
| Accrued shareholder administrative fees | | 57,537 | | 886 |
| Dividends payable | | 328,257 | | — |
| Accrued other expenses | | 355,724 | | 37,955 |
| Total Liabilities | | 291,759,820 | | 1,655,492 |
| NET ASSETS | $ | 5,017,559,886 | $ | 81,732,053 |
| |
| NET ASSETS CONSIST OF: | | | | |
| Paid in capital (par value of $.001 per share) | | 3,991,700,960 | | 58,068,308 |
| Undistributed net investment income (accumulated loss) | | 11,835,522 | | (67,341) |
| Undistributed net realized gain | | 237,673,129 | | 974,335 |
| Net unrealized appreciation on investments | | 776,350,275 | | 22,756,751 |
| NET ASSETS | $ | 5,017,559,886 | $ | 81,732,053 |
| * Identified cost | $ | 4,389,558,741 | $ | 56,131,867 |
| ** Identified cost | $ | 16,644,594 | $ | 67,903 |
| ‡ Proceeds received on short sales | $ | 184,395,140 | $ | — |
| See Notes to Financial Statements. | | | | |
- 54 -
THE ALGER FUNDS II
Statement of Assets and Liabilities April 30, 2015 (Unaudited) (Continued)
| | | | |
| | Alger Spectra Fund | Alger Green Fund |
| |
| NET ASSETS BY CLASS: | | | | |
| Class A | $ | 2,104,162,944 | $ | 33,106,898 |
| Class C | $ | 784,708,069 | $ | 5,735,535 |
| Class I | $ | 1,099,743,079 | $ | 42,889,620 |
| Class Z | $ | 1,028,945,794 | $ | — |
| |
| SHARES OF BENEFICIAL INTEREST OUTSTANDING — NOTE 6: | | | |
| Class A | | 116,402,965 | | 3,534,997 |
| Class C | | 45,697,820 | | 645,761 |
| Class I | | 60,342,226 | | 4,585,372 |
| Class Z | | 56,259,796 | | — |
| |
| NET ASSET VALUE PER SHARE: | | | | |
| Class A — Net Asset Value Per Share Class A and Class A | $ | 18.08 | $ | 9.37 |
| Class A — Offering Price Per Share | | | | |
| (includes a 5.25% sales charge) | $ | 19.08 | $ | 9.88 |
| Class C — Net Asset Value Per Share Class C and Class C | $ | 17.17 | $ | 8.88 |
| Class I — Net Asset Value Per Share Class I and Class I | $ | 18.23 | $ | 9.35 |
| Class Z — Net Asset Value Per Share Class Z | $ | 18.29 | $ | — |
| See Notes to Financial Statements. | | | | |
- 55 -
THE ALGER FUNDS II
Statement of Assets and Liabilities April 30, 2015 (Unaudited) (Continued)
| | | | |
| | | | | Alger Dynamic |
| | Alger Analyst Fund | Opportunities Fund |
| |
| ASSETS: | | | | |
| Investments in securities, at value (Identified cost below)* | | | | |
| see accompanying schedules of investments | $ | 9,043,105 | $ | 85,365,925 |
| Investments in affiliated securities, at value (Identified cost | | | | |
| below)** see accompanying schedules of investments | | — | | 506,450 |
| Cash and cash equivalents (a) | | 213,958 | | 14,799,064 |
| Receivable for investment securities sold | | — | | 182,125 |
| Receivable for shares of beneficial interest sold | | 1,736 | | 1,178,234 |
| Dividends and interest receivable | | 6,712 | | 64,827 |
| Receivable from Investment Manager | | 8,024 | | — |
| Prepaid expenses | | 36,026 | | 39,123 |
| Total Assets | | 9,309,561 | | 102,135,748 |
| |
| LIABILITIES: | | | | |
| Securities sold short, at value ‡ | | — | | 11,379,126 |
| Payable for investment securities purchased | | — | | 226,391 |
| Payable for shares of beneficial interest redeemed | | — | | 20,261 |
| Accrued investment advisory fees | | 5,900 | | 84,376 |
| Accrued transfer agent fees | | 1,104 | | 17,163 |
| Accrued distribution fees | | 2,190 | | 15,182 |
| Accrued administrative fees | | 216 | | 1,934 |
| Accrued shareholder administrative fees | | 119 | | 985 |
| Dividends payable | | — | | 11,713 |
| Accrued other expenses | | 25,072 | | 43,223 |
| Total Liabilities | | 34,601 | | 11,800,354 |
| NET ASSETS | $ | 9,274,960 | $ | 90,335,394 |
| |
| NET ASSETS CONSIST OF: | | | | |
| Paid in capital (par value of $.001 per share) | | 7,959,344 | | 83,741,847 |
| Undistributed net investment income (accumulated loss) | | (54,341) | | (1,562,897) |
| Undistributed net realized gain | | 440,807 | | 2,111,213 |
| Net unrealized appreciation on investments | | 929,150 | | 6,045,231 |
| NET ASSETS | $ | 9,274,960 | $ | 90,335,394 |
| * Identified cost | $ | 8,113,954 | $ | 78,727,582 |
| ** Identified cost | $ | — | $ | 506,450 |
| ‡ Proceeds received on short sales | $ | — | $ | 10,786,013 |
| (a) Includes restricted cash held as collateral for short sales | $ | — | $ | 4,545,807 |
| See Notes to Financial Statements. | | | | |
- 56 -
THE ALGER FUNDS II
Statement of Assets and Liabilities April 30, 2015 (Unaudited) (Continued)
| | | | |
| | | | | Alger Dynamic |
| | Alger Analyst Fund | Opportunities Fund |
| |
| NET ASSETS BY CLASS: | | | | |
| Class A | $ | 6,913,910 | $ | 50,099,873 |
| Class C | $ | 350,470 | $ | 7,060,594 |
| Class I | $ | 2,010,580 | $ | — |
| Class Z | $ | — | $ | 33,174,927 |
| |
| SHARES OF BENEFICIAL INTEREST OUTSTANDING — NOTE 6: | | | |
| Class A | | 516,354 | | 4,000,378 |
| Class C | | 27,542 | | 584,836 |
| Class I | | 150,606 | | — |
| Class Z | | — | | 2,617,954 |
| |
| NET ASSET VALUE PER SHARE: | | | | |
| Class A — Net Asset Value Per Share Class A and Class A | $ | 13.39 | $ | 12.52 |
| Class A — Offering Price Per Share | | | | |
| (includes a 5.25% sales charge) | $ | 14.13 | $ | 13.22 |
| Class C — Net Asset Value Per Share Class C and Class C | $ | 12.72 | $ | 12.07 |
| Class I — Net Asset Value Per Share Class I | $ | 13.35 | $ | — |
| Class Z — Net Asset Value Per Share Class Z | $ | — | $ | 12.67 |
| See Notes to Financial Statements. | | | | |
- 57 -
THE ALGER FUNDS II
Statement of Assets and Liabilities April 30, 2015 (Unaudited) (Continued)
| | | |
| | | | Alger Emerging |
| | | | Markets Fund |
| |
| ASSETS: | | | |
| Investments in securities, at value (Identified cost below)* | | | |
| see accompanying schedules of investments | | $ | 25,841,875 |
| Cash and cash equivalents | | | 531,277 |
| Foreign cash † | | | 267,000 |
| Receivable for investment securities sold | | | 181,496 |
| Receivable for shares of beneficial interest sold | | | 162,885 |
| Dividends and interest receivable | | | 10,822 |
| Receivable from Investment Manager | | | 34,863 |
| Prepaid expenses | | | 44,354 |
| Total Assets | | | 27,074,572 |
| |
| LIABILITIES: | | | |
| Payable foreign currency | | | 548 |
| Payable for investment securities purchased | | | 265,682 |
| Payable for shares of beneficial interest redeemed | | | 4,577 |
| Foreign capital gain tax payable | | | 17,922 |
| Accrued investment advisory fees | | | 23,589 |
| Accrued transfer agent fees | | | 6,544 |
| Accrued distribution fees | | | 6,377 |
| Accrued administrative fees | | | 590 |
| Accrued shareholder administrative fees | | | 268 |
| Accrued other expenses | | | 54,640 |
| Total Liabilities | | | 380,737 |
| NET ASSETS | | $ | 26,693,835 |
| |
| NET ASSETS CONSIST OF: | | | |
| Paid in capital (par value of $.001 per share) | | | 26,118,845 |
| Undistributed net investment income (accumulated loss) | | | (105,674) |
| Undistributed net realized gain (accumulated realized loss) | | | (2,782,162) |
| Net unrealized appreciation on investments | | | 3,462,826 |
| NET ASSETS | | $ | 26,693,835 |
| * Identified cost | | $ | 22,360,125 |
| † Cost of foreign cash | | $ | 266,056 |
| See Notes to Financial Statements. | | | |
| | | | |
- 58 -
THE ALGER FUNDS II
Statement of Assets and Liabilities April 30, 2015 (Unaudited) (Continued)
| | |
| | | Alger Emerging |
| | | Markets Fund |
| |
| NET ASSETS BY CLASS: | | |
| Class A | $ | 7,371,213 |
| Class C | $ | 2,955,184 |
| Class I | $ | 12,609,353 |
| Class Z | $ | 3,758,085 |
| |
| SHARES OF BENEFICIAL INTEREST OUTSTANDING — NOTE 6: | | |
| Class A | | 753,972 |
| Class C | | 310,356 |
| Class I | | 1,297,965 |
| Class Z | | 384,811 |
| |
| NET ASSET VALUE PER SHARE: | | |
| Class A — Net Asset Value Per Share Class A | $ | 9.78 |
| Class A — Offering Price Per Share | | |
| (includes a 5.25% sales charge) | $ | 10.32 |
| Class C — Net Asset Value Per Share Class C | $ | 9.52 |
| Class I — Net Asset Value Per Share Class I | $ | 9.71 |
| Class Z — Net Asset Value Per Share Class Z | $ | 9.77 |
| See Notes to Financial Statements. | | |
- 59 -
THE ALGER FUNDS II
Statement of Operations For the six months ended April 30, 2015 (Unaudited)
| | | | |
| | Alger Spectra Fund | Alger Green Fund |
| |
| INCOME: | | | | |
| Dividends (net of foreign withholding taxes*) | $ | 27,487,027 | $ | 488,185 |
| Interest | | 33,186 | | 725 |
| Total Income | | 27,520,213 | | 488,910 |
| |
| EXPENSES: | | | | |
| Advisory fees — Note 3(a) | | 18,856,487 | | 283,287 |
| Distribution fees — Note 3(c) | | | | |
| Class A | | 2,454,825 | | 40,337 |
| Class C | | 3,585,984 | | 27,104 |
| Class I | | 1,344,783 | | 52,636 |
| Shareholder administrative fees — Note 3(f) | | 323,830 | | 5,215 |
| Administration fees — Note 3(b) | | 650,916 | | 10,972 |
| Dividends on securities sold short | | 1,613,389 | | — |
| Custodian fees | | 177,629 | | 14,190 |
| Interest expenses | | 1,192 | | — |
| Borrowing fees on short sales | | 1,983,527 | | — |
| Transfer agent fees and expenses — Note 3(f) | | 1,297,331 | | 26,914 |
| Printing fees | | 243,270 | | 10,702 |
| Professional fees | | 76,994 | | 16,216 |
| Registration fees | | 166,805 | | 28,093 |
| Trustee fees — Note 3(g) | | 70,491 | | 4,974 |
| Fund accounting fees | | 319,795 | | 6,528 |
| Miscellaneous | | 117,585 | | 4,597 |
| Total Expenses | | 33,284,833 | | 531,765 |
| NET INVESTMENT LOSS | | (5,764,620) | | (42,855) |
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS, OPTIONS AND FOREIGN CURRENCY:
| | | | |
| Net realized gain on investments and purchased options | | 310,964,890 | | 1,043,043 |
| Net realized (loss) on foreign currency transactions | | (85,669) | | — |
| Net change in unrealized appreciation on investments, | | | | |
| options and foreign currency | | 25,344,053 | | 3,185,961 |
| Net change in unrealized appreciation on short sales | | 3,266,626 | | — |
| Net realized and unrealized gain on investments, options, and | | | | |
| foreign currency | | 339,489,900 | | 4,229,004 |
| NET INCREASE IN NET ASSETS RESULTING FROM | | | | |
| OPERATIONS | $ | 333,725,280 | $ | 4,186,149 |
| * Foreign withholding taxes | $ | 125,025 | $ | — |
| See Notes to Financial Statements. | | | | |
- 60 -
THE ALGER FUNDS II
Statement of Operations For the six months ended April 30, 2015 (Unaudited) (Continued)
| | | | |
| | | | | Alger Dynamic |
| | Alger Analyst Fund | Opportunities Fund |
| |
| INCOME: | | | | |
| Dividends (net of foreign withholding taxes*) | $ | 41,535 | $ | 294,020 |
| Interest | | 26 | | 3,080 |
| Total Income | | 41,561 | | 297,100 |
| |
| EXPENSES: | | | | |
| Advisory fees — Note 3(a) | | 34,158 | | 470,529 |
| Distribution fees — Note 3(c) | | | | |
| Class A | | 8,437 | | 51,319 |
| Class C | | 1,778 | | 31,880 |
| Class I | | 2,504 | | — |
| Shareholder administrative fees — Note 3(f) | | 686 | | 5,463 |
| Administration fees — Note 3(b) | | 1,252 | | 10,783 |
| Dividends on securities sold short | | — | | 101,862 |
| Custodian fees | | 17,043 | | 26,811 |
| Interest expenses | | 27 | | 864 |
| Borrowing fees on short sales | | — | | 61,027 |
| Transfer agent fees and expenses — Note 3(f) | | 1,457 | | 20,686 |
| Printing fees | | 448 | | 4,525 |
| Professional fees | | 14,933 | | 17,587 |
| Registration fees | | 26,245 | | 28,862 |
| Trustee fees — Note 3(g) | | 4,021 | | 4,920 |
| Fund accounting fees | | 1,869 | | 6,432 |
| Miscellaneous | | 2,372 | | 5,439 |
| Total Expenses | | 117,230 | | 848,989 |
| Less, expense reimbursements/waivers — Note 3(a) | | (54,109) | | — |
| Net Expenses | | 63,121 | | 848,989 |
| NET INVESTMENT LOSS | | (21,560) | | (551,889) |
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS, OPTIONS AND FOREIGN CURRENCY:
| | | | |
| Net realized gain on investments and purchased options | | 475,454 | | 2,387,142 |
| Net realized (loss) on foreign currency transactions | | (9) | | (319) |
| Net change in unrealized (depreciation) on investments, | | | | |
| options and foreign currency | | (11,055) | | (80,656) |
| Net change in unrealized appreciation on short sales | | — | | 505,909 |
| Net realized and unrealized gain on investments, options, and | | | | |
| foreign currency | | 464,390 | | 2,812,076 |
| NET INCREASE IN NET ASSETS RESULTING FROM | | | | |
| OPERATIONS | $ | 442,830 | $ | 2,260,187 |
| * Foreign withholding taxes | $ | 3 | $ | 635 |
| See Notes to Financial Statements. | | | | |
- 61 -
THE ALGER FUNDS II
Statement of Operations For the six months ended April 30, 2015 (Unaudited) (Continued)
| | |
| | | Alger Emerging |
| | | Markets Fund |
| |
| INCOME: | | |
| Dividends (net of foreign withholding taxes*) | $ | 124,377 |
| Interest | | 210 |
| Total Income | | 124,587 |
| |
| EXPENSES: | | |
| Advisory fees — Note 3(a) | | 132,342 |
| Distribution fees — Note 3(c) | | |
| Class A | | 8,496 |
| Class C | | 12,428 |
| Class I | | 14,194 |
| Shareholder administrative fees — Note 3(f) | | 1,505 |
| Administration fees — Note 3(b) | | 3,307 |
| Custodian fees | | 82,757 |
| Interest expenses | | 139 |
| Transfer agent fees and expenses — Note 3(f) | | 10,265 |
| Printing fees | | 2,881 |
| Professional fees | | 18,146 |
| Registration fees | | 36,152 |
| Trustee fees — Note 3(g) | | 4,217 |
| Fund accounting fees | | 3,655 |
| Miscellaneous | | 10,414 |
| Total Expenses | | 340,898 |
| Less, expense reimbursements/waivers — Note 3(a) | | (133,395) |
| Net Expenses | | 207,503 |
| NET INVESTMENT LOSS | | (82,916) |
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS, OPTIONS AND FOREIGN CURRENCY:
| | |
| Net realized (loss) on investments and purchased options | | (716,174) |
| Net realized (loss) on foreign currency transactions | | (11,056) |
| Net change in unrealized appreciation on investments, options and foreign currency | | 1,736,476 |
| Net realized and unrealized gain on investments, options, and foreign currency | | 1,009,246 |
| NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 926,330 |
| * Foreign withholding taxes | $ | 19,303 |
| See Notes to Financial Statements. | | |
- 62 -
THE ALGER FUNDS II
Statement of Changes in Net Assets (Unaudited)
| | | | | |
| | | | Alger Spectra Fund |
| | | | For the | | For the |
| | | | Six Months Ended | | Year Ended |
| | | | April 30, 2015 | | October 31, 2014 |
| |
| Net investment loss | $ | (5,764,620) | $ | (17,001,382) |
| Net realized gain on investments, options and foreign currency | | | 310,879,221 | | 549,046,110 |
| Net change in unrealized appreciation on investments, options | | | | | |
| and foreign currency | | | 28,610,679 | | 67,064,225 |
| Net increase in net assets resulting from operations | | | 333,725,280 | | 599,108,953 |
| |
| Dividends and distributions to shareholders from: | | | | | |
| Net realized gains: | | | | | |
| Class A | | | (232,068,288) | | (109,164,264) |
| Class C | | | (86,801,799) | | (28,224,522) |
| Class I | | | (129,154,885) | | (42,881,976) |
| Class Z | | | (115,269,367) | | (22,142,007) |
| Total dividends and distributions to shareholders | | | (563,294,339) | | (202,412,769) |
| |
| Increase (decrease) from shares of beneficial interest transactions: | | | | |
| Class A | | | 351,173,230 | | (224,389,370) |
| Class C | | | 173,259,788 | | 140,106,414 |
| Class I | | | 122,001,484 | | 203,149,916 |
| Class Z | | | 144,851,985 | | 511,410,776 |
| Net increase from shares of beneficial interest transactions — | | | | | |
| Note 6(a) | | | 791,286,487 | | 630,277,736 |
| |
| Redemption Fees: | | | | | |
| Class A | | | 15,847 | | 32,095 |
| Class C | | | 5,723 | | 3,015 |
| Total Redemption Fees — Note 6(b) | | | 21,570 | | 35,110 |
| Total increase | | | 561,738,998 | | 1,027,009,030 |
| |
| Net Assets: | | | | | |
| Beginning of period | | | 4,455,820,888 | | 3,428,811,858 |
| END OF PERIOD | $ | 5,017,559,886 | $ | 4,455,820,888 |
| Undistributed net investment income | $ | 11,835,522 | $ | 916,003 |
| See Notes to Financial Statements. | | | | | |
- 63 -
THE ALGER FUNDS II
Statement of Changes in Net Assets (Unaudited) (Continued)
| | | | | |
| | | | Alger Green Fund |
| | | | For the | | For the |
| | | | Six Months Ended | | Year Ended |
| | | | April 30, 2015 | | October 31, 2014 |
| |
| Net investment loss | $ | (42,855) | $ | (65,084) |
| Net realized gain on investments, options and foreign currency | | | 1,043,043 | | 2,157,805 |
| Net change in unrealized appreciation on investments, options | | | | | |
| and foreign currency | | | 3,185,961 | | 3,686,119 |
| Net increase in net assets resulting from operations | | | 4,186,149 | | 5,778,840 |
| |
| Dividends and distributions to shareholders from: | | | | | |
| Net investment income: | | | | | |
| Class I | | | — | | (9,327) |
| Net realized gains: | | | | | |
| Class A | | | (887,146) | | (1,150,902) |
| Class C | | | (153,204) | | (163,867) |
| Class I | | | (1,154,776) | | (1,380,791) |
| Total dividends and distributions to shareholders | | | (2,195,126) | | (2,704,887) |
| |
| Increase (decrease) from shares of beneficial interest transactions: | | | | |
| Class A | | | 620,425 | | (198,956) |
| Class C | | | 366,857 | | 1,001,925 |
| Class I | | | (56,803) | | 5,141,845 |
| Net increase from shares of beneficial interest transactions — | | | | | |
| Note 6(a) | | | 930,479 | | 5,944,814 |
| |
| Redemption Fees: | | | | | |
| Class A | | | 3 | | 1,346 |
| Class C | | | — | | 3 |
| Total Redemption Fees — Note 6(b) | | | 3 | | 1,349 |
| Total increase | | | 2,921,505 | | 9,020,116 |
| |
| Net Assets: | | | | | |
| Beginning of period | | | 78,810,548 | | 69,790,432 |
| END OF PERIOD | $ | 81,732,053 | $ | 78,810,548 |
| Undistributed net investment income (accumulated loss) | $ | (67,341) | $ | (36,753) |
| See Notes to Financial Statements. | | | | | |
- 64 -
THE ALGER FUNDS II
Statement of Changes in Net Assets (Unaudited) (Continued)
| | | | | |
| | | | Alger Analyst Fund |
| | | | For the | | For the |
| | | | Six Months Ended | | Year Ended |
| | | | April 30, 2015 | | October 31, 2014 |
| |
| Net investment loss | $ | (21,560) | $ | (37,457) |
| Net realized gain on investments, options and foreign currency | | | 475,445 | | 632,972 |
| Net change in unrealized appreciation (depreciation) on | | | | | |
| investments, options and foreign currency | | | (11,055) | | 91,298 |
| Net increase in net assets resulting from operations | | | 442,830 | | 686,813 |
| |
| Dividends and distributions to shareholders from: | | | | | |
| Net investment income: | | | | | |
| Class A | | | (27,209) | | — |
| Class I | | | (11,760) | | — |
| Net realized gains: | | | | | |
| Class A | | | (461,447) | | (477,809) |
| Class C | | | (26,114) | | (32,608) |
| Class I | | | (136,646) | | (182,876) |
| Total dividends and distributions to shareholders | | | (663,176) | | (693,293) |
| |
| Increase (decrease) from shares of beneficial interest transactions: | | | | |
| Class A | | | 616,754 | | 1,690,213 |
| Class C | | | (7,686) | | 90,807 |
| Class I | | | 84,021 | | 164,661 |
| Net increase from shares of beneficial interest transactions — | | | | | |
| Note 6(a) | | | 693,089 | | 1,945,681 |
| Total increase | | | 472,743 | | 1,939,201 |
| |
| Net Assets: | | | | | |
| Beginning of period | | | 8,802,217 | | 6,863,016 |
| END OF PERIOD | $ | 9,274,960 | $ | 8,802,217 |
| Undistributed net investment income (accumulated loss) | $ | (54,341) | $ | (14,195) |
| See Notes to Financial Statements. | | | | | |
- 65 -
THE ALGER FUNDS II
Statement of Changes in Net Assets (Unaudited) (Continued)
| | | | | |
| | | | Alger Dynamic Opportunities Fund |
| | | | For the | | For the |
| | | | Six Months Ended | | Year Ended |
| | | | April 30, 2015 | | October 31, 2014 |
| |
| Net investment loss | $ | (551,889) | $ | (1,081,687) |
| Net realized gain on investments, options and foreign currency | | | 2,386,823 | | 4,064,728 |
| Net change in unrealized appreciation on investments, options | | | | | |
| and foreign currency | | | 425,253 | | 1,116,109 |
| Net increase in net assets resulting from operations | | | 2,260,187 | | 4,099,150 |
| |
| Dividends and distributions to shareholders from: | | | | | |
| Net realized gains: | | | | | |
| Class A | | | (2,281,541) | | (2,433,734) |
| Class C | | | (361,352) | | (107,762) |
| Class Z | | | (1,765,215) | | (1,265,284) |
| Total dividends and distributions to shareholders | | | (4,408,108) | | (3,806,780) |
| |
| Increase (decrease) from shares of beneficial interest transactions: | | | | |
| Class A | | | 2,799,375 | | 11,614,091 |
| Class C | | | 1,441,937 | | 4,332,175 |
| Class Z | | | 4,141,605 | | 9,233,825 |
| Net increase from shares of beneficial interest transactions — | | | | | |
| Note 6(a) | | | 8,382,917 | | 25,180,091 |
| |
| Redemption Fees: | | | | | |
| Class A | | | 508 | | 4,651 |
| Class C | | | — | | 155 |
| Total Redemption Fees — Note 6(b) | | | 508 | | 4,806 |
| Total increase | | | 6,235,504 | | 25,477,267 |
| |
| Net Assets: | | | | | |
| Beginning of period | | | 84,099,890 | | 58,622,623 |
| END OF PERIOD | $ | 90,335,394 | $ | 84,099,890 |
| Undistributed net investment income (accumulated loss) | $ | (1,562,897) | $ | (1,036,497) |
| See Notes to Financial Statements. | | | | | |
- 66 -
THE ALGER FUNDS II
Statement of Changes in Net Assets (Unaudited) (Continued)
| | | | | |
| | | | Alger Emerging Markets Fund |
| | | | For the | | For the |
| | | | Six Months Ended | | Year Ended |
| | | | April 30, 2015 | | October 31, 2014 |
| |
| Net investment loss | $ | (82,916) | $ | (32,142) |
| Net realized loss on investments, options and foreign currency | | | (727,230) | | (882,634) |
| Net change in unrealized appreciation on investments, options | | | | | |
| and foreign currency | | | 1,736,476 | | 546,176 |
| Net increase (decrease) in net assets resulting from operations | | | 926,330 | | (368,600) |
| |
| Increase (decrease) from shares of beneficial interest transactions: | | | | |
| Class A | | | 208,437 | | 1,718,949 |
| Class C | | | 695,481 | | 1,715,588 |
| Class I | | | 704,806 | | 1,393,804 |
| Class Z | | | (41,279) | | 3,778,018 |
| Net increase from shares of beneficial interest transactions — | | | | | |
| Note 6(a) | | | 1,567,445 | | 8,606,359 |
| |
| Redemption Fees: | | | | | |
| Class A | | | 10 | | 625 |
| Class C | | | 3 | | 4 |
| Class Z | | | 61 | | — |
| Total Redemption Fees — Note 6(b) | | | 74 | | 629 |
| Total increase | | | 2,493,849 | | 8,238,388 |
| |
| Net Assets: | | | | | |
| Beginning of period | | | 24,199,986 | | 15,961,598 |
| END OF PERIOD | $ | 26,693,835 | $ | 24,199,986 |
| Undistributed net investment income (accumulated loss) | $ | (105,674) | $ | (28,202) |
| See Notes to Financial Statements. | | | | | |
- 67 -
THE ALGER FUNDS II
Financial Highlights for a share outstanding throughout the period (Unaudited)
| | | | | | | | | | | | |
| Alger Spectra Fund | | | | | | Class A | | | | |
| | Six months | | | | | | | | | | |
| | | ended | Year ended | Year ended | Year ended | Year ended | Year ended |
| | 4/30/2015(i) | 10/31/2014 | 10/31/2013 | 10/31/2012 | 10/31/2011 | 10/31/2010 |
| Net asset value, beginning of period | $ | 19.13 | $ | 17.37 | $ | 13.82 | $ | 12.35 | $ | 11.33 | $ | 9.28 |
| INCOME FROM INVESTMENT | | | | | | | | | | | | |
| OPERATIONS: | | | | | | | | | | | | |
| Net investment income (loss)(ii) | | (0.02) | | (0.06) | | 0.05 | | 0.02 | | (0.05) | | (0.06) |
| Net realized and unrealized gain on | | | | | | | | | | | | |
| investments | | 1.35 | | 2.82 | | 3.91 | | 1.66 | | 1.07 | | 2.11 |
| Total from investment operations | | 1.33 | | 2.76 | | 3.96 | | 1.68 | | 1.02 | | 2.05 |
| Dividends from net investment income | – | | – | | (0.09) | | – | | – | | – |
| Distributions from net realized gains | | (2.38) | | (1.00) | | (0.32) | | (0.21) | | – | | – |
| Net asset value, end of period | $ | 18.08 | $ | 19.13 | $ | 17.37 | $ | 13.82 | $ | 12.35 | $ | 11.33 |
| Total return(iii) | | 7.46% | | 16.56% | | 29.29% | | 14.00% | | 9.00% | | 22.00% |
| RATIOS/SUPPLEMENTAL DATA: | | | | | | | | | | | | |
| Net assets, end of period (000's | | | | | | | | | | | | |
| omitted) | $2,104,163 | $1,846,479 | $1,866,317 | $1,158,220 | $ 836,857 | $ 488,872 |
| Ratio of gross expenses to average | | | | | | | | | | | | |
| net assets | | 1.36%(iv) | | 1.52%(v) | | 1.52%(vi) | | 1.49%(vii) | | 1.58%(viii) | | 1.74%(ix) |
| Ratio of expense reimbursements to | | | | | | | | | | | | |
| average net assets | | – | | – | | – | | – | | – | | – |
| Ratio of net expenses to average net | | | | | | | | | | | | |
| assets | | 1.36% | | 1.52% | | 1.52% | | 1.49% | | 1.58% | | 1.74% |
| Ratio of net investment income (loss) to | | | | | | | | | | | | |
| average net assets | | (0.20)% | | (0.35)% | | 0.35% | | | 0.16% | | (0.38)% | | (0.57)% |
| Portfolio turnover rate | | 65.66% | | 149.01% | | 113.69% | | 139.90% | | 163.11% | | 252.68% |
| See Notes to Financial Statements. | | | | | | | | | | | |
(i) Ratios have been annualized; total return and portfolio turnover rate have not been annualized.
(ii) Amount was computed based on average shares outstanding during the period.
(iii) Does not reflect the effect of sales charges, if applicable.
(iv) Includes 0.15% related to dividend expense on short positions and interest expense for the period ended 4/30/15
(v) Includes 0.27% related to dividend expense on short positions and interest expense for the period ended 10/31/14
(vi) Includes 0.22% related to dividend expense on short positions and interest expense for the period ended 10/31/13
(vii) Includes 0.12% related to dividend expense on short positions and interest expense for the period ended 10/31/12
(viii) Includes 0.18% related to dividend expense on short positions and interest expense for the period ended 10/31/11
(ix) Includes 0.32% related to dividend expense on short positions and interest expense for the period ended 10/31/10
- 68 -
THE ALGER FUNDS II
Financial Highlights for a share outstanding throughout the period (Unaudited)
| | | | | | | | | | | | | |
| Alger Spectra Fund | | | | | | Class C | | | | |
| | Six months | | | | | | | | | | | |
| | | ended | Year ended | Year ended | Year ended | Year ended | Year ended |
| | 4/30/2015(i) | 10/31/2014 | 10/31/2013 | | 10/31/2012 | 10/31/2011 | 10/31/2010 |
| Net asset value, beginning of period | $ | 18.35 | $ | 16.81 | $ | 13.43 | $ | 12.09 | $ | 11.18 | $ | 9.23 |
| INCOME FROM INVESTMENT | | | | | | | | | | | | | |
| OPERATIONS: | | | | | | | | | | | | | |
| Net investment loss(ii) | | (0.08) | | (0.19) | | (0.07) | | | (0.07) | | (0.13) | | (0.14) |
| Net realized and unrealized gain on | | | | | | | | | | | | | |
| investments | | 1.28 | | 2.73 | | 3.79 | | | 1.62 | | 1.04 | | 2.09 |
| Total from investment operations | | 1.20 | | 2.54 | | 3.72 | | | 1.55 | | 0.91 | | 1.95 |
| Dividends from net investment income | – | | – | | (0.02) | | | – | | – | | – |
| Distributions from net realized gains | | (2.38) | | (1.00) | | (0.32) | | | (0.21) | | – | | – |
| Net asset value, end of period | $ | 17.17 | $ | 18.35 | $ | 16.81 | $ | 13.43 | $ | 12.09 | $ | 11.18 |
| Total return(iii) | | 7.04% | | 15.69% | | 28.38% | | | 13.12% | | 8.20% | | 21.00% |
| RATIOS/SUPPLEMENTAL DATA: | | | | | | | | | | | | | |
| Net assets, end of period (000's | | | | | | | | | | | | | |
| omitted) | $ 784,708 | $ 650,438 | $ 458,750 | $ 242,972 | $ 134,399 | $ 47,351 |
| Ratio of gross expenses to average | | | | | | | | | | | | | |
| net assets | | 2.11%(iv) | | 2.27%(v) | | 2.28%(vi) | | | 2.24%(vii) | | 2.32%(viii) | | 2.52%(ix) |
| Ratio of expense reimbursements to | | | | | | | | | | | | | |
| average net assets | | – | | – | | – | | | – | | – | | – |
| Ratio of net expenses to average net | | | | | | | | | | | | | |
| assets | | 2.11% | | 2.27% | | 2.28% | | | 2.24% | | 2.32% | | 2.52% |
| Ratio of net investment income (loss) to | | | | | | | | | | | | | |
| average net assets | | (0.95)% | | (1.12)% | | (0.46)% | | | (0.57)% | | (1.11)% | | (1.38)% |
| Portfolio turnover rate | | 65.66% | | 149.01% | | 113.69% | | | 139.90% | | 163.11% | | 252.68% |
| See Notes to Financial Statements. | | | | | | | | | | | | |
(i) Ratios have been annualized; total return and portfolio turnover rate have not been annualized.
(ii) Amount was computed based on average shares outstanding during the period.
(iii) Does not reflect the effect of sales charges, if applicable.
(iv) Includes 0.15% related to dividend expense on short positions and interest expense for the period ended 4/30/15
(v) Includes 0.28% related to dividend expense on short positions and interest expense for the period ended 10/31/14
(vi) Includes 0.22% related to dividend expense on short positions and interest expense for the period ended 10/31/13
(vii) Includes 0.13% related to dividend expense on short positions and interest expense for the period ended 10/31/12
(viii) Includes 0.17% related to dividend expense on short positions and interest expense for the period ended 10/31/11
(ix) Includes 0.31% related to dividend expense on short positions and interest expense for the period ended 10/31/10
- 69 -
THE ALGER FUNDS II
Financial Highlights for a share outstanding throughout the period (Unaudited)
| | | | | | | | | | | | |
| Alger Spectra Fund | | | | | | Class I | | | | |
| | Six months | | | | | | | | | | |
| | | ended | Year ended | Year ended | Year ended | Year ended | Year ended |
| | 4/30/2015(i) | 10/31/2014 | 10/31/2013 | 10/31/2012 | 10/31/2011 | 10/31/2010 |
| Net asset value, beginning of period | $ | 19.27 | $ | 17.48 | $ | 13.92 | $ | 12.42 | $ | 11.39 | $ | 9.32 |
| INCOME FROM INVESTMENT | | | | | | | | | | | | |
| OPERATIONS: | | | | | | | | | | | | |
| Net investment income (loss)(ii) | | (0.02) | | (0.06) | | 0.06 | | 0.03 | | (0.04) | | (0.05) |
| Net realized and unrealized gain on | | | | | | | | | | | | |
| investments | | 1.36 | | 2.85 | | 3.91 | | 1.68 | | 1.07 | | 2.12 |
| Total from investment operations | | 1.34 | | 2.79 | | 3.97 | | 1.71 | | 1.03 | | 2.07 |
| Dividends from net investment income | – | | – | | (0.09) | | – | | – | | – |
| Distributions from net realized gains | | (2.38) | | (1.00) | | (0.32) | | (0.21) | | – | | – |
| Net asset value, end of period | $ | 18.23 | $ | 19.27 | $ | 17.48 | $ | 13.92 | $ | 12.42 | $ | 11.39 |
| Total return(iii) | | 7.46% | | 16.63% | | 29.30% | | 14.07% | | 9.10% | | 22.10% |
| RATIOS/SUPPLEMENTAL DATA: | | | | | | | | | | | | |
| Net assets, end of period (000's | | | | | | | | | | | | |
| omitted) | $1,099,743 | $1,030,304 | $ 736,036 | $ 431,557 | $ 266,366 | $ 116,343 |
| Ratio of gross expenses to average | | | | | | | | | | | | |
| net assets | | 1.34%(iv) | | 1.50%(v) | | 1.50%(vi) | | 1.43%(vii) | | 1.50%(viii) | | 1.64%(ix) |
| Ratio of expense reimbursements to | | | | | | | | | | | | |
| average net assets | | – | | – | | – | | – | | – | | (0.01)% |
| Ratio of net expenses to average net | | | | | | | | | | | | |
| assets | | 1.34% | | 1.50% | | 1.50% | | 1.43% | | 1.50% | | 1.63% |
| Ratio of net investment income (loss) to | | | | | | | | | | | | |
| average net assets | | (0.18)% | | (0.35)% | | 0.36% | | 0.25% | | (0.29)% | | (0.46)% |
| Portfolio turnover rate | | 65.66% | | 149.01% | | 113.69% | | 139.90% | | 163.11% | | 252.68% |
| See Notes to Financial Statements. | | | | | | | | | | | |
(i) Ratios have been annualized; total return and portfolio turnover rate have not been annualized.
(ii) Amount was computed based on average shares outstanding during the period.
(iii) Does not reflect the effect of sales charges, if applicable.
(iv) Includes 0.15% related to dividend expense on short positions and interest expense for the period ended 4/30/15
(v) Includes 0.28% related to dividend expense on short positions and interest expense for the period ended 10/31/14
(vi) Includes 0.22% related to dividend expense on short positions and interest expense for the period ended 10/31/13
(vii) Includes 0.12% related to dividend expense on short positions and interest expense for the period ended 10/31/12
(viii) Includes 0.18% related to dividend expense on short positions and interest expense for the period ended 10/31/11
(ix) Includes 0.32% related to dividend expense on short positions and interest expense for the period ended 10/31/10
- 70 -
THE ALGER FUNDS II
Financial Highlights for a share outstanding throughout the period (Unaudited)
| | | | | | | | | | |
| Alger Spectra Fund | | | | | | Class Z | | | | |
| | | | | | | | | | From 12/29/2010 |
| | Six ended months | Year ended | Year ended | Year ended | (commencement of operations) to |
| | 4/30/2015(i) 10/31/2014 10/31/2013 10/31/2012 10/31/2011(ii) |
| Net asset value, beginning of period | $ | 19.30 | $ | 17.46 | $ | 13.90 | $ | 12.38 | $ | 12.20 |
| INCOME FROM INVESTMENT | | | | | | | | | | |
| OPERATIONS: | | | | | | | | | | |
| Net investment income (loss)(iii) | | 0.01 | | (0.02) | | 0.10 | | 0.08 | | – |
| Net realized and unrealized gain on | | | | | | | | | | |
| investments | | 1.36 | | 2.86 | | 3.91 | | 1.65 | | 0.18 |
| Total from investment operations | | 1.37 | | 2.84 | | 4.01 | | 1.73 | | 0.18 |
| Dividends from net investment income | – | | – | | (0.13) | | – | | – |
| Distributions from net realized gains | | (2.38) | | (1.00) | | (0.32) | | (0.21) | | – |
| Net asset value, end of period | $ | 18.29 | $ | 19.30 | $ | 17.46 | $ | 13.90 | $ | 12.38 |
| Total return(iv) | | 7.57% | | 17.01% | | 29.68% | | 14.28% | | 1.50% |
| RATIOS/SUPPLEMENTAL DATA: | | | | | | | | | | |
| Net assets, end of period (000's | | | | | | | | | | |
| omitted) | $1,028,946 | $ 928,600 | $ 367,709 | $ 215,244 | $ | 3,373 |
| Ratio of gross expenses to average | | | | | | | | | | |
| net assets | | 1.05%(v) | | 1.23%(vi) | | 1.20%(vii) | | 1.20%(viii) | | 2.65%(ix) |
| Ratio of expense reimbursements to | | | | | | | | | | |
| average net assets | | – | | – | | – | | – | | (1.41)% |
| Ratio of net expenses to average net | | | | | | | | | | |
| assets | | 1.05% | | 1.23% | | 1.20% | | 1.20% | | 1.24% |
| Ratio of net investment income (loss) to | | | | | | | | | | |
| average net assets | | 0.11% | | (0.11)% | | 0.65% | | 0.60% | | (0.01)% |
| Portfolio turnover rate | | 65.66% | | 149.01% | | 113.69% | | 139.90% | | 163.11% |
| See Notes to Financial Statements. | | | | | | | | | |
(i) Ratios have been annualized; total return and portfolio turnover rate have not been annualized.
(ii) Ratios have been annualized; total return has not been annualized; portfolio turnover is for the twelve months then ended.
(iii) Amount was computed based on average shares outstanding during the period.
(iv) Does not reflect the effect of sales charges, if applicable.
(v) Includes 0.15% related to dividend expense on short positions and interest expense for the period ended 4/30/15
(vi) Includes 0.30% related to dividend expense on short positions and interest expense for the period ended 10/31/14
(vii) Includes 0.22% related to dividend expense on short positions and interest expense for the period ended 10/31/13
(viii) Includes 0.17% related to dividend expense on short positions and interest expense for the period ended 10/31/12
(ix) Includes 0.14% related to dividend expense on short positions and interest expense for the period ended 10/31/11
- 71 -
THE ALGER FUNDS II
Financial Highlights for a share outstanding throughout the period (Unaudited)
| | | | | | | | | | | | | |
| Alger Green Fund | | | | | | Class A | | | | | |
| | Six months | | | | | | | | | | | |
| | | ended | Year ended | Year ended | Year ended | Year ended | Year ended |
| | 4/30/2015(i) | 10/31/2014 | 10/31/2013 | 10/31/2012 | 10/31/2011 | 10/31/2010 |
| Net asset value, beginning of period | $ | 9.14 | $ | 8.78 | $ | 6.68 | $ | 6.01 | $ | 6.03 | $ | 5.24 |
| INCOME FROM INVESTMENT | | | | | | | | | | | | | |
| OPERATIONS: | | | | | | | | | | | | | |
| Net investment income (loss)(ii) | | – | | – | | 0.01 | | | 0.01 | | (0.01) | | (0.01) |
| Net realized and unrealized gain (loss) | | | | | | | | | | | | | |
| on investments | | 0.49 | | 0.69 | | 2.10 | | | 0.66 | | (0.01) | | 0.80 |
| Total from investment operations | | 0.49 | | 0.69 | | 2.11 | | | 0.67 | | (0.02) | | 0.79 |
| Dividends from net investment income | – | | – | | (0.01) | | | – | | – | | – |
| Distributions from net realized gains | | (0.26) | | (0.33) | | – | | | – | | – | | – |
| Net asset value, end of period | $ | 9.37 | $ | 9.14 | $ | 8.78 | $ | 6.68 | $ | 6.01 | $ | 6.03 |
| Total return(iii) | | 5.42% | | 7.99% | | 31.63% | | | 11.15% | | (0.30)% | | 15.10% |
| RATIOS/SUPPLEMENTAL DATA: | | | | | | | | | | | | | |
| Net assets, end of period (000's | | | | | | | | | | | | | |
| omitted) | $ 33,107 | $ 31,662 | $ 30,586 | $ 26,243 | $ 27,018 | $ 37,545 |
| Ratio of gross expenses to average | | | | | | | | | | | | | |
| net assets | | 1.28% | | 1.33% | | 1.41% | | | 1.49% | | 1.46% | | 1.44% |
| Ratio of expense reimbursements to | | | | | | | | | | | | | |
| average net assets | | – | | – | | (0.06)% | | | (0.17)% | | (0.21)% | | (0.19)% |
| Ratio of net expenses to average net | | | | | | | | | | | | | |
| assets | | 1.28% | | 1.33% | | 1.35% | | | 1.32% | | 1.25% | | 1.25% |
| Ratio of net investment income (loss) to | | | | | | | | | | | | | |
| average net assets | | (0.05)% | | (0.05)% | | 0.18% | | | 0.12% | | (0.14)% | | (0.21)% |
| Portfolio turnover rate | | 9.07% | | 24.22% | | 43.35% | | | 21.25% | | 28.25% | | 29.44% |
| See Notes to Financial Statements. | | | | | | | | | | | | |
(i) Ratios have been annualized; total return and portfolio turnover rate have not been annualized.
(ii) Amount was computed based on average shares outstanding during the period.
(iii) Does not reflect the effect of sales charges, if applicable.
- 72 -
THE ALGER FUNDS II
Financial Highlights for a share outstanding throughout the period (Unaudited)
| | | | | | | | | | | | | |
| Alger Green Fund | | | | | | Class C | | | | | |
| | Six months | | | | | | | | | | | |
| | | ended | Year ended | Year ended | Year ended | Year ended | Year ended |
| | 4/30/2015(i) | 10/31/2014 | 10/31/2013 | | 10/31/2012 | 10/31/2011 | 10/31/2010 |
| Net asset value, beginning of period | $ | 8.71 | $ | 8.45 | $ | 6.47 | $ | 5.88 | $ | 5.94 | $ | 5.20 |
| INCOME FROM INVESTMENT | | | | | | | | | | | | | |
| OPERATIONS: | | | | | | | | | | | | | |
| Net investment loss(ii) | | (0.04) | | (0.07) | | (0.05) | | | (0.05) | | (0.05) | | (0.05) |
| Net realized and unrealized gain (loss) | | | | | | | | | | | | | |
| on investments | | 0.47 | | 0.66 | | 2.03 | | | 0.64 | | (0.01) | | 0.79 |
| Total from investment operations | | 0.43 | | 0.59 | | 1.98 | | | 0.59 | | (0.06) | | 0.74 |
| Distributions from net realized gains | | (0.26) | | (0.33) | | – | | | – | | – | | – |
| Net asset value, end of period | $ | 8.88 | $ | 8.71 | $ | 8.45 | $ | 6.47 | $ | 5.88 | $ | 5.94 |
| Total return(iii) | | 4.98% | | 7.09% | | 30.45% | | | 10.03% | | (1.00)% | | 14.20% |
| RATIOS/SUPPLEMENTAL DATA: | | | | | | | | | | | | | |
| Net assets, end of period (000's | | | | | | | | | | | | | |
| omitted) | $ | 5,735 | $ | 5,261 | $ | 4,096 | $ | 2,484 | $ | 2,517 | $ | 2,436 |
| Ratio of gross expenses to average | | | | | | | | | | | | | |
| net assets | | 2.07% | | 2.09% | | 2.16% | | | 2.31% | | 2.25% | | 2.26% |
| Ratio of expense reimbursements to | | | | | | | | | | | | | |
| average net assets | | – | | – | | – | | | (0.10)% | | (0.25)% | | (0.26)% |
| Ratio of net expenses to average net | | | | | | | | | | | | | |
| assets | | 2.07% | | 2.09% | | 2.16% | | | 2.21% | | 2.00% | | 2.00% |
| Ratio of net investment income (loss) to | | | | | | | | | | | | | |
| average net assets | | (0.85)% | | (0.81)% | | (0.69)% | | | (0.77)% | | (0.90)% | | (0.97)% |
| Portfolio turnover rate | | 9.07% | | 24.22% | | 43.35% | | | 21.25% | | 28.25% | | 29.44% |
| See Notes to Financial Statements. | | | | | | | | | | | | |
(i) Ratios have been annualized; total return and portfolio turnover rate have not been annualized.
(ii) Amount was computed based on average shares outstanding during the period.
(iii) Does not reflect the effect of sales charges, if applicable.
- 73 -
THE ALGER FUNDS II
Financial Highlights for a share outstanding throughout the period (Unaudited)
| | | | | | | | | | | | |
| Alger Green Fund | | | | | | Class I | | | | | |
| | Six months | | | | | | | | | | |
| | | ended | Year ended | Year ended | Year ended | Year ended | Year ended |
| | 4/30/2015(i) | 10/31/2014 | 10/31/2013 | 10/31/2012 | 10/31/2011 | 10/31/2010 |
| Net asset value, beginning of period | $ | 9.12 | $ | 8.77 | $ | 6.67 | $ | 6.01 | $ | 6.02 | $ | 5.24 |
| INCOME FROM INVESTMENT | | | | | | | | | | | | |
| OPERATIONS: | | | | | | | | | | | | |
| Net investment income (loss)(ii) | | – | | – | | 0.01 | | 0.01 | | (0.01) | | (0.01) |
| Net realized and unrealized gain on | | | | | | | | | | | | |
| investments | | 0.49 | | 0.68 | | 2.10 | | 0.65 | | – | | 0.79 |
| Total from investment operations | | 0.49 | | 0.68 | | 2.11 | | 0.66 | | (0.01) | | 0.78 |
| Dividends from net investment income | – | | – | | (0.01) | | – | | – | | – |
| Distributions from net realized gains | | (0.26) | | (0.33) | | – | | – | | – | | – |
| Net asset value, end of period | $ | 9.35 | $ | 9.12 | $ | 8.77 | $ | 6.67 | $ | 6.01 | $ | 6.02 |
| Total return(iii) | | 5.42% | | 7.91% | | 31.68% | | 11.00% | | (0.20)% | | 14.90% |
| RATIOS/SUPPLEMENTAL DATA: | | | | | | | | | | | | |
| Net assets, end of period (000's | | | | | | | | | | | | |
| omitted) | $ 42,890 | $ 41,888 | $ 35,108 | $ 19,717 | $ 19,604 | $ 13,461 |
| Ratio of gross expenses to average | | | | | | | | | | | | |
| net assets | | 1.28% | | 1.30% | | 1.35% | | 1.52% | | 1.63% | | 1.47% |
| Ratio of expense reimbursements to | | | | | | | | | | | | |
| average net assets | | – | | – | | – | | (0.20)% | | (0.38)% | | (0.22)% |
| Ratio of net expenses to average net | | | | | | | | | | | | |
| assets | | 1.28% | | 1.30% | | 1.35% | | 1.32% | | 1.25% | | 1.25% |
| Ratio of net investment income (loss) to | | | | | | | | | | | | |
| average net assets | | (0.05)% | | (0.03)% | | 0.14% | | 0.10% | | (0.16)% | | (0.22)% |
| Portfolio turnover rate | | 9.07% | | 24.22% | | 43.35% | | 21.25% | | 28.25% | | 29.44% |
| See Notes to Financial Statements. | | | | | | | | | | | |
(i) Ratios have been annualized; total return and portfolio turnover rate have not been annualized.
(ii) Amount was computed based on average shares outstanding during the period.
(iii) Does not reflect the effect of sales charges, if applicable.
- 74 -
THE ALGER FUNDS II
Financial Highlights for a share outstanding throughout the period (Unaudited)
| | | | | | | | | | | | |
| Alger Analyst Fund | | | | | | Class A | | | | |
| | Six months | | | | | | | | | | |
| | | ended | Year ended | Year ended | Year ended | Year ended | Year ended |
| | 4/30/2015(i) | 10/31/2014 | 10/31/2013 | 10/31/2012 | 10/31/2011 | 10/31/2010 |
| Net asset value, beginning of period | $ | 13.74 | $ | 13.86 | $ | 10.83 | $ | 9.85 | $ | 9.54 | $ | 8.02 |
| INCOME FROM INVESTMENT | | | | | | | | | | | | |
| OPERATIONS: | | | | | | | | | | | | |
| Net investment loss(ii) | | (0.03) | | (0.06) | | (0.01) | | (0.03) | | (0.05) | | (0.05) |
| Net realized and unrealized gain on | | | | | | | | | | | | |
| investments | | 0.70 | | 1.33 | | 3.66 | | 1.01 | | 0.36 | | 1.57 |
| Total from investment operations | | 0.67 | | 1.27 | | 3.65 | | 0.98 | | 0.31 | | 1.52 |
| Dividends from net investment income | (0.06) | | – | | – | | – | | – | | – |
| Distributions from net realized gains | | (0.96) | | (1.39) | | (0.62) | | – | | – | | – |
| Net asset value, end of period | $ | 13.39 | $ | 13.74 | $ | 13.86 | $ | 10.83 | $ | 9.85 | $ | 9.54 |
| Total return(iii) | | 5.04% | | 9.83% | | 35.40% | | 10.00% | | 3.20% | | 19.00% |
| RATIOS/SUPPLEMENTAL DATA: | | | | | | | | | | | | |
| Net assets, end of period (000's | | | | | | | | | | | | |
| omitted) | $ | 6,914 | $ | 6,459 | $ | 4,766 | $ | 2,524 | $ | 2,306 | $ | 2,236 |
| Ratio of gross expenses to average | | | | | | | | | | | | |
| net assets | | 2.54% | | 2.75% | | 4.07% | | 4.85% | | 5.31% | | 5.68% |
| Ratio of expense reimbursements to | | | | | | | | | | | | |
| average net assets | | (1.18)% | | (1.45)% | | (2.77)% | | (3.58)% | | (4.11)% | | (4.48)% |
| Ratio of net expenses to average net | | | | | | | | | | | | |
| assets | | 1.36% | | 1.30% | | 1.30% | | 1.27% | | 1.20% | | 1.20% |
| Ratio of net investment income (loss) to | | | | | | | | | | | | |
| average net assets | | (0.45)% | | (0.43)% | | (0.07)% | | (0.30)% | | (0.50)% | | (0.60)% |
| Portfolio turnover rate | | 64.42% | | 170.12% | | 158.26% | | 158.39% | | 141.68% | | 73.54% |
| See Notes to Financial Statements. | | | | | | | | | | | |
(i) Ratios have been annualized; total return and portfolio turnover rate have not been annualized.
(ii) Amount was computed based on average shares outstanding during the period.
(iii) Does not reflect the effect of sales charges, if applicable.
- 75 -
THE ALGER FUNDS II
Financial Highlights for a share outstanding throughout the period (Unaudited)
| | | | | | | | | | | | | |
| Alger Analyst Fund | | | | | | Class C | | | | |
| | Six months | | | | | | | | | | | |
| | | ended | Year ended | Year ended | Year ended | Year ended | Year ended |
| | 4/30/2015(i) | 10/31/2014 | 10/31/2013 | | 10/31/2012 | 10/31/2011 | 10/31/2010 |
| Net asset value, beginning of period | $ | 13.09 | $ | 13.35 | $ | 10.51 | $ | 9.62 | $ | 9.39 | $ | 7.95 |
| INCOME FROM INVESTMENT | | | | | | | | | | | | | |
| OPERATIONS: | | | | | | | | | | | | | |
| Net investment loss(ii) | | (0.07) | | (0.14) | | (0.09) | | | (0.10) | | (0.12) | | (0.12) |
| Net realized and unrealized gain on | | | | | | | | | | | | | |
| investments | | 0.66 | | 1.27 | | 3.55 | | | 0.99 | | 0.35 | | 1.56 |
| Total from investment operations | | 0.59 | | 1.13 | | 3.46 | | | 0.89 | | 0.23 | | 1.44 |
| Dividends from net investment income | – | | – | | – | | | – | | – | | – |
| Distributions from net realized gains | | (0.96) | | (1.39) | | (0.62) | | | – | | – | | – |
| Net asset value, end of period | $ | 12.72 | $ | 13.09 | $ | 13.35 | $ | 10.51 | $ | 9.62 | $ | 9.39 |
| Total return(iii) | | 4.68% | | 9.09% | | 34.63% | | | 9.25% | | 2.40% | | 18.10% |
| RATIOS/SUPPLEMENTAL DATA: | | | | | | | | | | | | | |
| Net assets, end of period (000's | | | | | | | | | | | | | |
| omitted) | $ | 350 | $ | 368 | $ | 282 | $ | 184 | $ | 165 | $ | 166 |
| Ratio of gross expenses to average | | | | | | | | | | | | | |
| net assets | | 3.32% | | 3.53% | | 5.49% | | | 6.00% | | 6.45% | | 6.54% |
| Ratio of expense reimbursements to | | | | | | | | | | | | | |
| average net assets | | (1.37)% | | (1.58)% | | (3.54)% | | | (4.05)% | | (4.50)% | | (4.59)% |
| Ratio of net expenses to average net | | | | | | | | | | | | | |
| assets | | 1.95% | | 1.95% | | 1.95% | | | 1.95% | | 1.95% | | 1.95% |
| Ratio of net investment income (loss) to | | | | | | | | | | | | | |
| average net assets | | (1.04)% | | (1.08)% | | (0.73)% | | | (0.99)% | | (1.25)% | | (1.35)% |
| Portfolio turnover rate | | 64.42% | | 170.12% | | 158.26% | | | 158.39% | | 141.68% | | 73.54% |
| See Notes to Financial Statements. | | | | | | | | | | | | |
(i) Ratios have been annualized; total return and portfolio turnover rate have not been annualized.
(ii) Amount was computed based on average shares outstanding during the period.
(iii) Does not reflect the effect of sales charges, if applicable.
- 76 -
THE ALGER FUNDS II
Financial Highlights for a share outstanding throughout the period (Unaudited)
| | | | | | | | | | | | |
| Alger Analyst Fund | | | | | | Class I | | | | |
| | Six months | | | | | | | | | | |
| | | ended | Year ended | Year ended | Year ended | Year ended | Year ended |
| | 4/30/2015(i) | 10/31/2014 | 10/31/2013 | 10/31/2012 | 10/31/2011 | 10/31/2010 |
| Net asset value, beginning of period | $ | 13.73 | $ | 13.85 | $ | 10.82 | $ | 9.84 | $ | 9.53 | $ | 8.01 |
| INCOME FROM INVESTMENT | | | | | | | | | | | | |
| OPERATIONS: | | | | | | | | | | | | |
| Net investment loss(ii) | | (0.03) | | (0.06) | | (0.01) | | (0.03) | | (0.05) | | (0.05) |
| Net realized and unrealized gain on | | | | | | | | | | | | |
| investments | | 0.69 | | 1.33 | | 3.66 | | 1.01 | | 0.36 | | 1.57 |
| Total from investment operations | | 0.66 | | 1.27 | | 3.65 | | 0.98 | | 0.31 | | 1.52 |
| Dividends from net investment income | (0.08) | | – | | – | | – | | – | | – |
| Distributions from net realized gains | | (0.96) | | (1.39) | | (0.62) | | – | | – | | – |
| Net asset value, end of period | $ | 13.35 | $ | 13.73 | $ | 13.85 | $ | 10.82 | $ | 9.84 | $ | 9.53 |
| Total return(iii) | | 5.02% | | 9.84% | | 35.44% | | 10.00% | | 3.30% | | 19.00% |
| RATIOS/SUPPLEMENTAL DATA: | | | | | | | | | | | | |
| Net assets, end of period (000's | | | | | | | | | | | | |
| omitted) | $ | 2,011 | $ | 1,975 | $ | 1,815 | $ | 1,180 | $ | 776 | $ | 183 |
| Ratio of gross expenses to average | | | | | | | | | | | | |
| net assets | | 2.55% | | 2.79% | | 4.07% | | 5.95% | | 6.91% | | 14.02% |
| Ratio of expense reimbursements to | | | | | | | | | | | | |
| average net assets | | (1.19)% | | (1.49)% | | (2.77)% | | (4.68)% | | (5.71)% | | (12.82)% |
| Ratio of net expenses to average net | | | | | | | | | | | | |
| assets | | 1.36% | | 1.30% | | 1.30% | | 1.27% | | 1.20% | | 1.20% |
| Ratio of net investment income (loss) to | | | | | | | | | | | | |
| average net assets | | (0.45)% | | (0.41)% | | (0.08)% | | (0.33)% | | (0.50)% | | (0.60)% |
| Portfolio turnover rate | | 64.42% | | 170.12% | | 158.26% | | 158.39% | | 141.68% | | 73.54% |
| See Notes to Financial Statements. | | | | | | | | | | | |
(i) Ratios have been annualized; total return and portfolio turnover rate have not been annualized.
(ii) Amount was computed based on average shares outstanding during the period.
(iii) Does not reflect the effect of sales charges, if applicable.
- 77 -
THE ALGER FUNDS II
Financial Highlights for a share outstanding throughout the period (Unaudited)
| | | | | | | | | | | | |
| Alger Dynamic Opportunities | | | | | | | | | | | | |
| Fund | | | | | | Class A | | | | |
| | | | | | | | | | | | From 11/2/2009 |
| | Six ended months | Year ended | Year ended | Year ended | Year ended | (commencement of operations) to |
| | 4/30/2015(i) 10/31/2014 10/31/2013 10/31/2012 10/31/2011 10/31/2010(ii) |
| Net asset value, beginning of period | $ | 12.86 | $ | 12.90 | $ | 11.12 | $ | 10.64 | $ | 10.55 | $ | 10.00 |
| INCOME FROM INVESTMENT | | | | | | | | | | | | |
| OPERATIONS: | | | | | | | | | | | | |
| Net investment loss(iii) | | (0.09) | | (0.20) | | (0.16) | | (0.14) | | (0.21) | | (0.20) |
| Net realized and unrealized gain on | | | | | | | | | | | | |
| investments | | 0.49 | | 0.96 | | 1.94 | | 0.77 | | 0.30 | | 0.75 |
| Total from investment operations | | 0.40 | | 0.76 | | 1.78 | | 0.63 | | 0.09 | | 0.55 |
| Distributions from net realized gains | | (0.74) | | (0.80) | | – | | (0.15) | | – | | – |
| Net asset value, end of period | $ | 12.52 | $ | 12.86 | $ | 12.90 | $ | 11.12 | $ | 10.64 | $ | 10.55 |
| Total return(iv) | | 3.19% | | 6.15% | | 16.01% | | 6.07% | | 0.90% | | 5.50% |
| RATIOS/SUPPLEMENTAL DATA: | | | | | | | | | | | | |
| Net assets, end of period (000's | | | | | | | | | | | | |
| omitted) | $ 50,100 | $ 48,464 | $ 36,712 | $ 21,741 | $ 11,514 | $ 14,527 |
| Ratio of gross expenses to average | | | | | | | | | | | | |
| net assets | | 2.21%(v) | | 2.46%(vi) | | 2.61%(vii) | | 2.98%(viii) | | 3.09%(ix) | | 3.30%(x) |
| Ratio of expense reimbursements to | | | | | | | | | | | | |
| average net assets | | – | | – | | (0.03)% | | (0.36)% | | (0.62)% | | (0.78)% |
| Ratio of net expenses to average net | | | | | | | | | | | | |
| assets | | 2.21% | | 2.46% | | 2.58% | | 2.62% | | 2.47% | | 2.52% |
| Ratio of net investment income (loss) to | | | | | | | | | | | | |
| average net assets | | (1.46)% | | (1.57)% | | (1.37)% | | (1.26)% | | (1.87)% | | (2.00)% |
| Portfolio turnover rate | | 66.14% | | 205.45% | | 201.50% | | 257.74% | | 430.05% | | 438.65% |
| See Notes to Financial Statements. | | | | | | | | | | | |
(i) Ratios have been annualized; total return and portfolio turnover rate have not been annualized.
(ii) Ratios have been annualized; total return has not been annualized; portfolio turnover is for the twelve months then ended.
(iii) Amount was computed based on average shares outstanding during the period.
(iv) Does not reflect the effect of sales charges, if applicable.
(v) Includes 0.41% related to dividend expense on short positions and interest expense for the period ended 4/30/15
(vi) Includes 0.57% related to dividend expense on short positions and interest expense for the period ended 10/31/14
(vii) Includes 0.58% related to dividend expense on short positions and interest expense for the period ended 10/31/13
(viii) Includes 0.62% related to dividend expense on short positions and interest expense for the period ended 10/31/12
(ix) Includes 0.47% related to dividend expense on short positions and interest expense for the period ended 10/31/11
(x) Includes 0.45% related to dividend expense on short positions and interest expense for the period ended 10/31/10
- 78 -
THE ALGER FUNDS II
Financial Highlights for a share outstanding throughout the period (Unaudited)
| | | | | | | | | | |
| Alger Dynamic Opportunities | | | | | | | | | | |
| Fund | | | | | | Class C | | | | |
| | | | | | | | | | From 12/29/2010 |
| | Six ended months | Year ended | Year ended | Year ended | (commencement of operations) to |
| | 4/30/2015(i) 10/31/2014 10/31/2013 10/31/2012 10/31/2011(ii) |
| Net asset value, beginning of period | $ | 12.47 | $ | 12.62 | $ | 10.95 | $ | 10.57 | $ | 10.96 |
| INCOME FROM INVESTMENT | | | | | | | | | | |
| OPERATIONS: | | | | | | | | | | |
| Net investment loss(iii) | | (0.13) | | (0.29) | | (0.25) | | (0.22) | | (0.23) |
| Net realized and unrealized gain (loss) | | | | | | | | | | |
| on investments | | 0.47 | | 0.94 | | 1.92 | | 0.75 | | (0.16) |
| Total from investment operations | | 0.34 | | 0.65 | | 1.67 | | 0.53 | | (0.39) |
| Distributions from net realized gains | | (0.74) | | (0.80) | | – | | (0.15) | | – |
| Net asset value, end of period | $ | 12.07 | $ | 12.47 | $ | 12.62 | $ | 10.95 | $ | 10.57 |
| Total return(iv) | | 2.80% | | 5.38% | | 15.15% | | 5.25% | | (3.60)% |
| RATIOS/SUPPLEMENTAL DATA: | | | | | | | | | | |
| Net assets, end of period (000's | | | | | | | | | | |
| omitted) | $ | 7,060 | $ | 5,808 | $ | 1,407 | $ | 622 | $ | 539 |
| Ratio of gross expenses to average | | | | | | | | | | |
| net assets | | 2.97%(v) | | 3.23%(vi) | | 3.36%(vii) | | 4.00%(viii) | | 4.12%(ix) |
| Ratio of expense reimbursements to | | | | | | | | | | |
| average net assets | | – | | – | | (0.03)% | | (0.62)% | | (0.96)% |
| Ratio of net expenses to average net | | | | | | | | | | |
| assets | | 2.97% | | 3.23% | | 3.33% | | 3.38% | | 3.16% |
| Ratio of net investment income (loss) to | | | | | | | | | | |
| average net assets | | (2.20)% | | (2.36)% | | (2.13)% | | (2.05)% | | 2.56% |
| Portfolio turnover rate | | 66.14% | | 205.45% | | 201.50% | | 257.74% | | 430.05% |
| See Notes to Financial Statements. | | | | | | | | | |
(i) Ratios have been annualized; total return and portfolio turnover rate have not been annualized.
(ii) Ratios have been annualized; total return has not been annualized; portfolio turnover is for the twelve months then ended.
(iii) Amount was computed based on average shares outstanding during the period.
(iv) Does not reflect the effect of sales charges, if applicable.
(v) Includes 0.42% related to dividend expense on short positions and interest expense for the period ended 4/30/15
(vi) Includes 0.59% related to dividend expense on short positions and interest expense for the period ended 10/31/14
(vii) Includes 0.58% related to dividend expense on short positions and interest expense for the period ended 10/31/13
(viii) Includes 0.63% related to dividend expense on short positions and interest expense for the period ended 10/31/12
(ix) Includes 0.41% related to dividend expense on short positions and interest expense for the period ended 10/31/11
- 79 -
THE ALGER FUNDS II
Financial Highlights for a share outstanding throughout the period (Unaudited)
| | | | | | | | | | |
| Alger Dynamic Opportunities | | | | | | | | | | |
| Fund | | | | | | Class Z | | | | |
| | | | | | | | | | From 12/29/2010 |
| | Six ended months | Year ended | Year ended | Year ended | (commencement of operations) to |
| | 4/30/2015(i) 10/31/2014 10/31/2013 10/31/2012 10/31/2011(ii) |
| Net asset value, beginning of period | $ | 12.99 | $ | 12.98 | $ | 11.16 | $ | 10.66 | $ | 10.96 |
| INCOME FROM INVESTMENT | | | | | | | | | | |
| OPERATIONS: | | | | | | | | | | |
| Net investment loss(iii) | | (0.07) | | (0.16) | | (0.13) | | (0.10) | | (0.15) |
| Net realized and unrealized gain (loss) | | | | | | | | | | |
| on investments | | 0.49 | | 0.97 | | 1.95 | | 0.75 | | (0.15) |
| Total from investment operations | | 0.42 | | 0.81 | | 1.82 | | 0.65 | | (0.30) |
| Distributions from net realized gains | | (0.74) | | (0.80) | | – | | (0.15) | | – |
| Net asset value, end of period | $ | 12.67 | $ | 12.99 | $ | 12.98 | $ | 11.16 | $ | 10.66 |
| Total return(iv) | | 3.32% | | 6.52% | | 16.29% | | 6.34% | | (2.70)% |
| RATIOS/SUPPLEMENTAL DATA: | | | | | | | | | | |
| Net assets, end of period (000's | | | | | | | | | | |
| omitted) | $ 33,175 | $ 29,828 | $ 20,504 | $ 17,158 | $ 11,368 |
| Ratio of gross expenses to average | | | | | | | | | | |
| net assets | | 1.94%(v) | | 2.18%(vi) | | 2.34%(vii) | | 2.73%(viii) | | 11.84%(ix) |
| Ratio of expense reimbursements to | | | | | | | | | | |
| average net assets | | – | | – | | – | | (0.35)% | | (9.30)% |
| Ratio of net expenses to average net | | | | | | | | | | |
| assets | | 1.94% | | 2.18% | | 2.34% | | 2.38% | | 2.54% |
| Ratio of net investment income (loss) to | | | | | | | | | | |
| average net assets | | (1.18)% | | (1.29)% | | (1.08)% | | (0.90)% | | (1.92)% |
| Portfolio turnover rate | | 66.14% | | 205.45% | | 201.50% | | 257.74% | | 430.05% |
| See Notes to Financial Statements. | | | | | | | | | |
(i) Ratios have been annualized; total return and portfolio turnover rate have not been annualized.
(ii) Ratios have been annualized; total return has not been annualized; portfolio turnover is for the twelve months then ended.
(iii) Amount was computed based on average shares outstanding during the period.
(iv) Does not reflect the effect of sales charges, if applicable.
(v) Includes 0.42% related to dividend expense on short positions and interest expense for the period ended 4/30/15
(vi) Includes 0.57% related to dividend expense on short positions and interest expense for the period ended 10/31/14
(vii) Includes 0.58% related to dividend expense on short positions and interest expense for the period ended 10/31/13
(viii) Includes 0.62% related to dividend expense on short positions and interest expense for the period ended 10/31/12
(ix) Includes 0.79% related to dividend expense on short positions and interest expense for the period ended 10/31/11
- 80 -
THE ALGER FUNDS II
Financial Highlights for a share outstanding throughout the period (Unaudited)
| | | | | | | | | | |
| Alger Emerging Markets Fund | | | | | | Class A | | | | |
| | | | | | | | | | From 12/29/2010 |
| | Six ended months | Year ended | Year ended | Year ended | (commencement of operations) to |
| | 4/30/2015(i) 10/31/2014 10/31/2013 10/31/2012 10/31/2011(ii) |
| Net asset value, beginning of period | $ | 9.44 | $ | 9.57 | $ | 8.52 | $ | 8.32 | $ | 10.00 |
| INCOME FROM INVESTMENT | | | | | | | | | | |
| OPERATIONS: | | | | | | | | | | |
| Net investment income (loss)(iii) | | (0.03) | | (0.01) | | 0.02 | | 0.03 | | 0.04 |
| Net realized and unrealized gain (loss) | | | | | | | | | | |
| on investments | | 0.37 | | (0.12) | | 1.19 | | 0.17 | | (1.72) |
| Total from investment operations | | 0.34 | | (0.13) | | 1.21 | | 0.20 | | (1.68) |
| Dividends from net investment income | – | | – | | (0.16) | | – | | – |
| Net asset value, end of period | $ | 9.78 | $ | 9.44 | $ | 9.57 | $ | 8.52 | $ | 8.32 |
| Total return(iv) | | 3.60% | | (1.36)% | | 14.31% | | 2.40% | | (16.80)% |
| RATIOS/SUPPLEMENTAL DATA: | | | | | | | | | | |
| Net assets, end of period (000's | | | | | | | | | | |
| omitted) | $ | 7,371 | $ | 6,931 | $ | 5,260 | $ | 1,176 | $ | 764 |
| Ratio of gross expenses to average | | | | | | | | | | |
| net assets | | 2.80% | | 2.99% | | 3.49% | | 4.43% | | 4.60% |
| Ratio of expense reimbursements to | | | | | | | | | | |
| average net assets | | (1.10)% | | (1.29)% | | (1.79)% | | (2.73)% | | (2.90)% |
| Ratio of net expenses to average net | | | | | | | | | | |
| assets | | 1.70% | | 1.70% | | 1.70% | | 1.70% | | 1.70% |
| Ratio of net investment income (loss) to | | | | | | | | | | |
| average net assets | | (0.69)% | | (0.13)% | | 0.19% | | 0.31% | | 0.51% |
| Portfolio turnover rate | | 54.75% | | 98.25% | | 103.59% | | 150.09% | | 121.91% |
| See Notes to Financial Statements. | | | | | | | | | |
(i) Ratios have been annualized; total return and portfolio turnover rate have not been annualized.
(ii) Ratios have been annualized; total return has not been annualized; portfolio turnover is for the twelve months then ended.
(iii) Amount was computed based on average shares outstanding during the period.
(iv) Does not reflect the effect of sales charges, if applicable.
- 81 -
THE ALGER FUNDS II
Financial Highlights for a share outstanding throughout the period (Unaudited)
| | | | | | | | | | |
| Alger Emerging Markets Fund | | | | | | Class C | | | | |
| | | | | | | | | | From 12/29/2010 |
| | Six ended months | Year ended | Year ended | Year ended | (commencement of operations) to |
| | 4/30/2015(i) 10/31/2014 10/31/2013 10/31/2012 10/31/2011(ii) |
| Net asset value, beginning of period | $ | 9.23 | $ | 9.42 | $ | 8.37 | $ | 8.23 | $ | 10.00 |
| INCOME FROM INVESTMENT | | | | | | | | | | |
| OPERATIONS: | | | | | | | | | | |
| Net investment loss(iii) | | (0.06) | | (0.08) | | (0.06) | | (0.05) | | (0.03) |
| Net realized and unrealized gain (loss) | | | | | | | | | | |
| on investments | | 0.35 | | (0.11) | | 1.17 | | 0.19 | | (1.74) |
| Total from investment operations | | 0.29 | | (0.19) | | 1.11 | | 0.14 | | (1.77) |
| Dividends from net investment income | – | | – | | (0.06) | | – | | – |
| Net asset value, end of period | $ | 9.52 | $ | 9.23 | $ | 9.42 | $ | 8.37 | $ | 8.23 |
| Total return(iv) | | 3.14% | | (2.02)% | | 13.34% | | 1.70% | | (17.70)% |
| RATIOS/SUPPLEMENTAL DATA: | | | | | | | | | | |
| Net assets, end of period (000's | | | | | | | | | | |
| omitted) | $ | 2,955 | $ | 2,151 | $ | 484 | $ | 151 | $ | 142 |
| Ratio of gross expenses to average | | | | | | | | | | |
| net assets | | 3.54% | | 3.79% | | 4.75% | | 5.61% | | 5.99% |
| Ratio of expense reimbursements to | | | | | | | | | | |
| average net assets | | (1.09)% | | (1.34)% | | (2.30)% | | (3.16)% | | (3.54)% |
| Ratio of net expenses to average net | | | | | | | | | | |
| assets | | 2.45% | | 2.45% | | 2.45% | | 2.45% | | 2.45% |
| Ratio of net investment income (loss) to | | | | | | | | | | |
| average net assets | | (1.39)% | | (0.84)% | | (0.73)% | | (0.57)% | | (0.39)% |
| Portfolio turnover rate | | 54.75% | | 98.25% | | 103.59% | | 150.09% | | 121.91% |
| See Notes to Financial Statements. | | | | | | | | | |
(i) Ratios have been annualized; total return and portfolio turnover rate have not been annualized.
(ii) Ratios have been annualized; total return has not been annualized; portfolio turnover is for the twelve months then ended.
(iii) Amount was computed based on average shares outstanding during the period.
(iv) Does not reflect the effect of sales charges, if applicable.
- 82 -
THE ALGER FUNDS II
Financial Highlights for a share outstanding throughout the period (Unaudited)
| | | | | | | | | | |
| Alger Emerging Markets Fund | | | | | | Class I | | | | |
| | | | | | | | | | From 12/29/2010 |
| | Six ended months | Year ended | Year ended | Year ended | (commencement of operations) to |
| | 4/30/2015(i) 10/31/2014 10/31/2013 10/31/2012 10/31/2011(ii) |
| Net asset value, beginning of period | $ | 9.38 | $ | 9.51 | $ | 8.48 | $ | 8.28 | $ | 10.00 |
| INCOME FROM INVESTMENT | | | | | | | | | | |
| OPERATIONS: | | | | | | | | | | |
| Net investment income (loss)(iii) | | (0.03) | | (0.02) | | 0.01 | | 0.01 | | – |
| Net realized and unrealized gain (loss) | | | | | | | | | | |
| on investments | | 0.36 | | (0.11) | | 1.19 | | 0.19 | | (1.72) |
| Total from investment operations | | 0.33 | | (0.13) | | 1.20 | | 0.20 | | (1.72) |
| Dividends from net investment income | – | | – | | (0.17) | | – | | – |
| Net asset value, end of period | $ | 9.71 | $ | 9.38 | $ | 9.51 | $ | 8.48 | $ | 8.28 |
| Total return(iv) | | 3.62% | | (1.37)% | | 14.26% | | 2.42% | | (17.20)% |
| RATIOS/SUPPLEMENTAL DATA: | | | | | | | | | | |
| Net assets, end of period (000's | | | | | | | | | | |
| omitted) | $ 12,610 | $ 11,451 | $ 10,218 | $ | 8,712 | $ | 8,490 |
| Ratio of gross expenses to average | | | | | | | | | | |
| net assets | | 2.74% | | 2.92% | | 3.45% | | 4.28% | | 4.16% |
| Ratio of expense reimbursements to | | | | | | | | | | |
| average net assets | | (1.04)% | | (1.22)% | | (1.75)% | | (2.58)% | | (2.46)% |
| Ratio of net expenses to average net | | | | | | | | | | |
| assets | | 1.70% | | 1.70% | | 1.70% | | 1.70% | | 1.70% |
| Ratio of net investment income (loss) to | | | | | | | | | | |
| average net assets | | (0.67)% | | (0.16)% | | 0.06% | | 0.15% | | 0.05% |
| Portfolio turnover rate | | 54.75% | | 98.25% | | 103.59% | | 150.09% | | 121.91% |
| See Notes to Financial Statements. | | | | | | | | | |
(i) Ratios have been annualized; total return and portfolio turnover rate have not been annualized.
(ii) Ratios have been annualized; total return has not been annualized; portfolio turnover is for the twelve months then ended.
(iii) Amount was computed based on average shares outstanding during the period.
(iv) Does not reflect the effect of sales charges, if applicable.
- 83 -
THE ALGER FUNDS II
Financial Highlights for a share outstanding throughout the period (Unaudited)
| | | | |
| Alger Emerging Markets Fund | | Class Z | |
| |
| | Six months | From 2/28/2014 |
| | | ended | (commencement of operations) to |
| | 4/30/2015(i) | 10/31/2014(ii) |
| Net asset value, beginning of period | $ | 9.41 | $ | 9.24 |
| INCOME FROM INVESTMENT | | | | |
| OPERATIONS: | | | | |
| Net investment income (loss)(iii) | | (0.01) | | 0.02 |
| Net realized and unrealized gain on | | | | |
| investments | | 0.37 | | 0.15 |
| Total from investment operations | | 0.36 | | 0.17 |
| Net asset value, end of period | $ | 9.77 | $ | 9.41 |
| Total return(iv) | | 3.83% | | 1.84% |
| RATIOS/SUPPLEMENTAL DATA: | | | | |
| Net assets, end of period (000's | | | | |
| omitted) | $ | 3,758 | $ | 3,667 |
| Ratio of gross expenses to average | | | | |
| net assets | | 2.67% | | 3.35% |
| Ratio of expense reimbursements to | | | | |
| average net assets | | (1.42)% | | (2.10)% |
| Ratio of net expenses to average net | | | | |
| assets | | 1.25% | | 1.25% |
| Ratio of net investment income (loss) to | | | | |
| average net assets | | (0.26)% | | 0.29% |
| Portfolio turnover rate | | 54.75% | | 98.25% |
| See Notes to Financial Statements. | | | |
(i) Ratios have been annualized; total return and portfolio turnover rate have not been annualized.
(ii) Ratios have been annualized; total return has not been annualized; portfolio turnover is for the twelve months then ended.
(iii) Amount was computed based on average shares outstanding during the period.
(iv) Does not reflect the effect of sales charges, if applicable.
- 84 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited)
NOTE 1 — General:
The Alger Funds II (the “Trust”) is a diversified open-end registered investment company
organized as a business trust under the laws of the Commonwealth of Massachusetts. The
Fund qualifies as an investment company as defined in the Financial Accounting Standards
Board Accounting Standards Codification 946-Financial Services – Investment Companies.
The Trust operates as a series company currently offering an unlimited number of shares
of beneficial interest in five funds—Alger Spectra Fund, Alger Green Fund, Alger Analyst
Fund, Alger Dynamic Opportunities Fund and Alger Emerging Markets Fund (collectively,
the “Funds” or individually, each a “Fund”). The Funds normally invest primarily in equity
securities and each has an investment objective of long-term capital appreciation.
Each Fund offers one or more of the following share classes: Class A shares, Class C shares,
Class I shares and Class Z shares. Class A shares are generally subject to an initial sales
charge while Class C shares are generally subject to a deferred sales charge. Class I shares
and Class Z shares are sold to institutional investors without an initial or deferred sales
charge. Each class has identical rights to assets and earnings, except that each share class
bears the costs of its plan of distribution, if it maintains one, and transfer agency and sub-
transfer agency services.
NOTE 2 — Significant Accounting Policies:
(a) Investment Valuation: The Funds value their financial instruments at fair value using
independent dealers or pricing services under policies approved by the Board of Trustees.
Investments are valued on each day the New York Stock Exchange (the “NYSE”) is open,
as of the close of the NYSE (normally 4:00 p.m. Eastern time).
Equity securities and option contracts for which valuation information is readily available are
valued at the last quoted sales price or official closing price as reported by an independent
pricing service on the primary market or exchange on which they are traded. In the absence
of quoted sales, such securities are valued at the bid price or, in the absence of a recent
bid price, the equivalent as obtained from one or more of the major market makers for the
securities to be valued.
Debt securities generally trade in the over-the-counter market. Debt securities with
remaining maturities of more than sixty days at the time of acquisition are valued on
the basis of last available bid prices or current market quotations provided by dealers
or pricing services. In determining the value of a particular investment, pricing services
may use certain information with respect to transactions in such investments, quotations
from dealers, pricing matrixes, market transactions in comparable investments, various
relationships observed in the market between investments and calculated yield measures
based on valuation technology commonly employed in the market for such investments.
Asset-backed and mortgage-backed securities are valued by independent pricing services
using models that consider estimated cash flows of each tranche of the security, establish a
benchmark yield and develop an estimated tranche-specific spread to the benchmark yield
based on the unique attributes of the tranche. Debt securities with a remaining maturity of
sixty days or less are valued at amortized cost which approximates market value.
- 85 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Securities for which market quotations are not readily available are valued at fair value, as
determined in good faith pursuant to procedures established by the Board of Trustees.
Securities in which the Funds invest may be traded in foreign markets that close before the
close of the NYSE. Developments that occur between the close of the foreign markets and
the close of the NYSE may result in adjustments to the foreign closing prices to reflect what
the investment adviser, pursuant to policies established by the Board of Trustees, believes
to be the fair value of these securities as of the close of the NYSE. The Funds may also fair
value securities in other situations, for example, when a particular foreign market is closed
but the Fund is open.
Financial Accounting Standards Board Accounting Standards Codification 820 – Fair Value
Measurements and Disclosures (“ASC 820”) defines fair value as the price that the Funds
would receive upon selling an investment in a timely transaction to an independent buyer
in the principal or most advantageous market of the investment. ASC 820 established a
three-tier hierarchy to maximize the use of observable market data and minimize the use of
unobservable inputs and to establish classification of fair value measurements for disclosure
purposes. Inputs refer broadly to the assumptions that market participants would use in
pricing the asset or liability and may be observable or unobservable. Observable inputs
are based on market data obtained from sources independent of the Funds. Unobservable
inputs are inputs that reflect the Funds’ own assumptions based on the best information
available in the circumstances. The three-tier hierarchy of inputs is summarized in the three
broad Levels listed below.
• Level 1 – quoted prices in active markets for identical investments
• Level 2 – significant other observable inputs (including quoted prices for similar
investments, interest rates, prepayment speeds, credit risk, etc.)
• Level3 – significant unobservable inputs (including the Funds’ own assumptions in
determining the fair value of investments)
The Funds’ valuation techniques are generally consistent with either the market or the
income approach to fair value. The market approach considers prices and other relevant
information generated by market transactions involving identical or comparable assets
to measure fair value. The income approach converts future amounts to a current, or
discounted, single amount. These fair value measurements are determined on the basis
of the value indicated by current market expectations about such future events. Inputs
for Level 1 include exchange-listed prices and broker quotes in an active market. Inputs
for Level 2 include the last trade price in the case of a halted security, an exchange-listed
price which has been adjusted for fair value factors, and prices of closely related securities.
Additional Level 2 inputs include an evaluated price which is based upon a compilation of
observable market information such as spreads for fixed income and preferred securities.
Inputs for Level 3 include revenue multiples, earnings before interest, taxes, depreciation
and amortization (“EBITDA”) multiples, discount rates, and the probabilities of success of
certain outcomes. Such unobservable market information may be obtained from a company’s
- 86 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
financial statements and from industry studies, market data, and market indicators such as
benchmarks and indices.
Valuation processes are determined by a Valuation Committee (“Committee”) established
by the Trust’s Board of Trustees (“Board”) and comprised of representatives of the Trust’s
investment advisor. The Committee reports its fair valuation determinations to the Board
which is responsible for approving valuation policy and procedures.
While the Committee meets on an as-needed basis, the Committee formally meets
quarterly to review and evaluate the effectiveness of the procedures for making fair value
determinations. The Committee considers, among other things, the results of quarterly
back testing of the fair value model for foreign securities, pricing comparisons between
primary and secondary price sources, the outcome of price challenges put to the Funds’
pricing vendor, and variances between transactional prices and previous mark-to-markets.
The Funds will record a change to a security’s fair value level if new inputs are available or
it becomes evident that inputs previously considered for leveling have changed or are no
longer relevant. Transfers between Levels 1 and 2 are recognized at the end of the reporting
period, and transfers into and out of Level 3 are recognized during the reporting period.
(b) Cash and Cash Equivalents: Cash and cash equivalents include U.S. dollars, foreign cash
and overnight time deposits.
(c) Securities Transactions and Investment Income: Securities transactions are recorded on a
trade date basis. Realized gains and losses from securities transactions are recorded on the
identified cost basis. Dividend income is recognized on the ex-dividend date and interest
income is recognized on the accrual basis.
(d) Foreign Currency Translations: The books and records of the Funds are maintained in U.S.
dollars. Foreign currencies, investments and other assets and liabilities are translated into
U.S. dollars at the prevailing rates of exchange on the valuation date. Purchases and sales
of investment securities and income and expenses are translated into U.S. dollars at the
prevailing exchange rates on the respective dates of such transactions.
Net realized gains and losses on foreign currency transactions represent net gains and losses
from the disposition of foreign currencies, currency gains and losses realized between the
trade dates and settlement dates of security transactions, and the difference between the
amount of net investment income accrued and the U.S. dollar amount actually received.
The effects of changes in foreign currency exchange rates on investments in securities
are included in realized and unrealized gain or loss on investments in the accompanying
Statement of Operations.
(e) Short Sales: Securities sold short represent an obligation to deliver the securities at a
future date. A Fund may sell a security it does not own in anticipation of a decline in the
value of that security before the delivery date. When a Fund sells a security short, it must
borrow the security sold short and deliver it to the broker-dealer through which it made
the short sale. Dividends paid on securities sold short are disclosed as an expense on the
- 87 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Statement of Operations. A gain, limited to the price at which the Fund sold the security
short, or a loss, unlimited in size, will be recognized upon the termination of a short sale.
To secure its obligation to deliver to the broker-dealer the securities sold short, the Fund
must segregate an amount of cash or liquid securities with its custodian equal to any excess
of the current market value of the securities sold short over any cash or liquid securities
deposited as collateral with the broker in connection with the short sale (not including the
proceeds of the short sale). As a result of that requirement, the Fund will not gain any
leverage merely by selling short, except to the extent that it earns interest or other income
or gains on the segregated cash or liquid securities while also being subject to gain or loss
from the securities sold short.
(f) Option Contracts: When a Fund writes an option, an amount equal to the premium received
by the Fund is recorded as a liability and is subsequently adjusted to the current fair value
of the option written. Premiums received from writing options that expire unexercised are
treated by the Fund on the expiration date as realized gains from investments. The difference
between the premium and the amount paid on effecting a closing purchase transaction,
including brokerage commissions, is also treated as a realized gain, or, if the premium is less
than the amount paid for the closing purchase transaction, as a realized loss. If a call option
is exercised, the premium is added to the proceeds from the sale of the underlying security
in determining whether the Fund has realized a gain or loss. If a put option is exercised, the
premium reduces the cost basis of the securities purchased by the Fund. The Fund, as writer
of an option, bears the market risk of an unfavorable change in the price of the security
underlying the written option.
The Funds may also purchase put and call options. Each Fund pays a premium which is
included in the Fund’s Statement of Assets and Liabilities as an investment and subsequently
marked to market to reflect the current value of the option. Premiums paid for purchasing
options which expire are treated as realized losses. The risk associated with purchasing put
and call options is limited to the premium paid. Premiums paid for purchasing options
which are exercised or closed are added to the amounts paid or offset against the proceeds
on the underlying security to determine the realized gain or loss.
(g) Lending of Fund Securities: The Funds may lend their securities to financial institutions,
provided that the market value of the securities loaned will not at any time exceed one
third of the Fund’s total assets, as defined in its prospectuses. The Funds earn fees on the
securities loaned, which are included in interest income in the accompanying Statements
of Operations. In order to protect against the risk of failure by the borrower to return the
securities loaned or any delay in the delivery of such securities, the loan is collateralized by
cash or securities that are maintained with the Custodian in an amount equal to at least 102
percent of the current market value of U.S. loaned securities or 105 percent for non-U.S.
loaned securities. The market value of the loaned securities is determined at the close of
business of the Fund. Any required additional collateral is delivered to the Custodian and
any excess collateral is returned to the borrower on the next business day. In the event the
borrower fails to return the loaned securities when due, the Funds may take the collateral
to replace the securities. If the value of the collateral is less than the purchase cost of
- 88 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
replacement securities, the Custodian shall be responsible for any shortfall, but only to
the extent that the shortfall is not due to any diminution in collateral value, as defined in
the securities lending agreement. The Funds are required to maintain the collateral in a
segregated account and determine its value each day until the loaned securities are returned.
Cash collateral may be invested as determined by the Funds. Collateral is returned to the
borrower upon settlement of the loan. There were no securities loaned as of April 30, 2015.
(h) Dividends to Shareholders: Dividends and distributions payable to shareholders are
recorded by the Funds on the ex-dividend date. Dividends from net investment income and
distributions from net realized gains are declared and paid annually after the end of the fiscal
year in which earned.
Each class is treated separately in determining the amounts of dividends from net investment
income payable to holders of its shares.
The characterization of distributions to shareholders for financial reporting purposes is
determined in accordance with federal income tax rules. Therefore, the source of a Fund’s
distributions may be shown in the accompanying financial statements as either from, or in
excess of, net investment income, net realized gain on investment transactions or return of
capital, depending on the type of book/tax differences that may exist. Capital accounts within
the financial statements are adjusted for permanent book/tax differences. Reclassifications
result primarily from the difference in tax treatment of net operating losses, passive foreign
investment companies, and foreign currency transactions. The reclassifications are done
annually at fiscal year end and have no impact on the net asset values of the Funds, and are
designed to present each Fund’s capital accounts on a tax basis.
(i) Federal Income Taxes: It is each Fund’s policy to comply with the requirements of the
Internal Revenue Code Subchapter M applicable to regulated investment companies and to
distribute all of its taxable income to its shareholders. Provided the Funds maintain such
compliance, no federal income tax provision is required. Each Fund is treated as a separate
entity for the purpose of determining such compliance.
Financial Accounting Standards Board Accounting Standards Codification 740 – Income
Taxes (“ASC 740”) requires the Funds to measure and recognize in their financial statements
the benefit of a tax position taken (or expected to be taken) on an income tax return if such
position will more likely than not be sustained upon examination based on the technical
merits of the position. No tax years are currently under investigation. The Funds file
income tax returns in the U.S., as well as New York State and New York City. The statute of
limitations on the tax returns for the Alger Spectra Fund, Alger Green Fund, Alger Analyst
Fund, Alger Dynamic Opportunities Fund and Alger Emerging Markets Fund remains
open for the tax years 2011-2014 and the intermediary period through April 30, 2015.
Management does not believe there are any uncertain tax positions that require recognition
of a tax liability.
(j) Allocation Methods: The Trust accounts separately for the assets, liabilities and operations
of each Fund. Expenses directly attributable to each Fund are charged to that Fund’s
operations; expenses which are applicable to all Funds are allocated among them based on
- 89 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
net assets. Income, realized and unrealized gains and losses, and expenses of each Fund
are allocated among the Fund’s classes based on relative net assets, with the exception of
distribution fees, transfer agency fees, and shareholder servicing and related fees.
(k) Estimates: These financial statements have been prepared in accordance with accounting
principles generally accepted in the United States of America, which require using estimates
and assumptions that affect the reported amounts therein. Actual results may differ from
those estimates. These unaudited interim financial statements reflect all adjustments which
are, in the opinion of management, necessary to present a fair statement of results for the
interim period. All such adjustments are of normal recurring nature.
NOTE 3 — Investment Advisory Fees and Other Transactions with Affiliates:
(a) Investment Advisory: Fees incurred by each Fund, pursuant to the provisions of the Trust’s
Investment Advisory Agreement with Fred Alger Management, Inc., (“Alger Management”
or the “Manager”), are payable monthly and computed based on the following rates. The
actual rate paid as a percentage of average daily net assets, for the six months ended April
30, 2015, is set forth below under the heading “Actual Rate.”:
| | | | |
| | Tier 1 | Tier 2 | Tier 3 | Actual Rate |
| Alger Spectra Fund(a) | 0.900% | 0.750% | 0.650% | 0.860% |
| Alger Green Fund(b) | 0.710 | 0.650 | — | 0.710 |
| Alger Analyst Fund(b) | 0.750 | 0.700 | — | 0.750 |
| Alger Dynamic Opportunities Fund(b) | 1.200 | 1.000 | — | 1.200 |
| Alger Emerging Markets Fund(c) | 1.100 | — | — | 1.100 |
(a) Tier 1 rate is paid on assets up to $2 billion, Tier 2 rate is paid on assets between $2 and
$4 billion and Tier 3 rate is paid on assets in excess of $4 billion.
(b) Tier 1 rate is paid on assets up to $1 billion and Tier 2 rate is paid on assets in excess of
$1 billion.
(c) Tier 1 rate is paid on all assets.
Alger Management has established expense caps for several share classes, effective through
February 28, 2016, whereby it reimburses the share classes if annualized operating expenses
(excluding interest, taxes, brokerage, dividend expense and extraordinary expenses) exceed
the rates, based on average daily net assets, listed below:
| | | | | | | |
| | | | | | FEES WAIVED / |
| | | | | | REIMBURSED FOR |
| | | | | | THE SIX MONTHS |
| | | CLASS | | | ENDED |
| | A | C | I | Z | APRIL 30, 2015 |
| Alger Analyst Fund | 1.50% | 1.95% | 1.50% | – | | $ | 54,109 |
| Alger Emerging Markets Fund | 1.70 | 2.45 | 1.70 | 1.25% | | | 68,895 |
Alger Management voluntarily reduced its advisory fee for the Alger Emerging Markets
Fund by $64,500 for the six months ended April 30, 2015.
- 90 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
(b) Administration Fees: Fees incurred by each Fund, pursuant to the provisions of the Trust’s
Administration Agreement with Fred Alger Management, Inc., are payable monthly and
computed based on the average daily net assets of each Fund at the annual rate of 0.0275%.
(c) Distribution Fees: The Trust has adopted a distribution plan pursuant to which Class
A shares, Class C shares and Class I shares of each Fund pay Fred Alger & Company,
Incorporated, the distributor (the “Distributor” or “Alger Inc.”), a fee at the annual rate
listed below of the respective average daily net assets of the share class of the designated
Fund to compensate Alger Inc. for its activities and expenses incurred in distributing the
share class and shareholder servicing. Fees paid may be more or less than the expenses
incurred by Alger Inc.
| |
| | FEE |
| SHARE CLASS | RATE |
| A | 0.25% |
| C | 1.00 |
| I | 0.25 |
(d) Sales Charges: Purchases and sales of shares of the Funds may be subject to initial sales
charges or contingent deferred sales charges. The contingent deferred sales charges are
used by Alger Inc. to offset distribution expenses previously incurred. Sales charges do not
represent expenses of the Trust. For the six months ended April 30, 2015, the initial sales
charges and contingent deferred sales charges imposed, all of which were retained by Alger
Inc, were as follows:
| | | | |
| | | | | CONTINGENT |
| | INITIAL SALES | DEFERRED SALES |
| | | CHARGES | | CHARGES |
| Alger Spectra Fund | $ | 6,676 | $ | 35,831 |
| Alger Green Fund | | 1,185 | | 1,268 |
| Alger Analyst Fund | | – | | 529 |
| Alger Dynamic Opportunities Fund | | – | | 607 |
| Alger Emerging Markets Fund | | 15 | | 42 |
(e) Brokerage Commissions: During the six months ended April 30, 2015, Alger Spectra Fund,
Alger Green Fund, Alger Analyst Fund, Alger Dynamic Opportunities Fund and Alger
Emerging Markets Fund paid Alger Inc., an affiliate of Alger Management, $891,624, $925,
$3,618, $9,048, and $297, respectively, in connection with securities transactions.
(f) Shareholder Administrative Fees: The Trust has entered into a shareholder administrative
services agreement with Alger Management, to compensate Alger Management for its
liaison and administrative oversight of Boston Financial Data Services, Inc., the transfer
agent, and other related services. The Funds compensate Alger Management at the annual
rate of 0.0165% of their respective average daily net assets for the Class A and Class C
shares and 0.01% of the daily net assets of the Class I shares and Class Z shares for these
services.
Alger Management makes payments to intermediaries that provide sub-accounting services
to omnibus accounts invested in the Funds. A portion of the fees paid by Alger Management
to intermediaries that provide sub-accounting services are charged back to the appropriate
- 91 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Fund, subject to certain limitations, as approved by the Board. For the six months ended
April 30, 2015, Alger Management charged back to Alger Spectra Fund, Alger Green Fund,
Alger Analyst Fund, Alger Dynamic Opportunities Fund and Alger Emerging Markets
Fund $503,597, $15,792, $237, $9,159 and $2,636, respectively, for these services, which are
included in transfer agent fees and expenses in the accompanying Statements of Operations
(g) Trustees’ Fees: From November 1, 2014 through February 28, 2015, the Fund paid each
trustee who is not affiliated with Alger Management or its affiliates $950 for each meeting
attended, to a maximum of $3,800 per annum, plus travel expenses incurred for attending
the meeting. The Chairman of the Board received an additional annual fee of $24,300 which
was paid, pro rata, by all U.S.-registered funds managed by Alger Management. Additionally,
each member of the Fund’s audit committee received $81 from the Fund for each audit
committee meeting attended, to a maximum of $324 per annum.
Effective March 1, 2015, each Independent Trustee receives a fee of $25,875 for each
meeting attended, to a maximum of $103,500 per annum, paid pro rata by each Fund in
the Alger Fund Complex, plus travel expenses incurred for attending the meeting. The
Independent Trustee appointed as Chairman of the Board of Trustees receives an additional
compensation of $24,300 per annum paid pro rata by each fund in the Alger Fund Complex.
Additional, each member of the Audit Committee receives a fee of $2,500 for each meeting
attended to a maximum of $10,000 per annum, paid pro rata by each Fund in the Alger
Fund Complex.
(h) Interfund Loans: The Funds, along with other funds advised by Alger Management, may
borrow money from and lend money to each other for temporary or emergency purposes.
To the extent permitted under its investment restrictions, each fund may lend uninvested
cash in an amount up to 15% of its net assets to other funds. If a fund has borrowed from
other funds and has aggregate borrowings from all sources that exceed 10% of the fund’s
total assets, such fund will secure all of its loans from other funds. The interest rate charged
on interfund loans is equal to the average of the overnight time deposit rate and bank loan
rate available to the funds. There were no interfund loans outstanding as of April 30, 2015.
During the six months ended April 30, 2015, Alger Spectra Fund, Alger Green Fund, Alger
Dynamic Opportunities Fund and Alger Emerging Markets Fund earned interfund loan
interest income of $19,864, $182, $529 and $16, respectively.
(i) Other Transactions with Affiliates: Certain officers of the Trust are directors and officers of
Alger Management and Alger Inc. At April 30, 2015, Alger Management and its affiliates
owned the following shares:
- 92 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
| | | | | | | | |
| | | | | SHARE CLASS | | |
| | | A | | C | | I | | Z |
| Alger Spectra Fund | 1,602,556 14,423 | 14,344 | | 104 |
| Alger Green Fund | | — | | — | | — | | — |
| Alger Analyst Fund | 414,046 | 14,847 | 128,988 | | — |
| Alger Dynamic Opportunities Fund | 129,880 | | 105 | | — | 1,732,953 |
| Alger Emerging Markets Fund | 115,052 | | 101 | 1,007,783 10,823 |
NOTE 4 — Securities Transactions:
The following summarizes the securities transactions by the Trust, other than short-term
securities, purchased options and short sales for the six months ended April 30, 2015:
| | | | |
| | | PURCHASES | | SALES |
| Alger Spectra Fund | | $3,423,902,515 | | $3,182,517,532 |
| Alger Green Fund | | 6,961,572 | | 7,588,301 |
| Alger Analyst Fund | | 5,774,846 | | 5,866,530 |
| Alger Dynamic Opportunities Fund | | 38,037,014 | | 35,629,804 |
| Alger Emerging Markets Fund | | 14,657,866 | | 13,019,966 |
Transactions in foreign securities may involve certain considerations and risks not typically
associated with those of U.S. companies because of, among other factors, the level of
governmental supervision and regulation of foreign security markets, and the possibility of
political or economic instability. Additional risks associated with investing in the emerging
markets include increased volatility, limited liquidity, and less stringent regulatory and legal
system.
NOTE 5 — Borrowing:
The Funds may borrow from their custodian on an uncommitted basis. Each Fund pays the
custodian a market rate of interest, generally based upon the London Interbank Offered
Rate. The Funds may also borrow from other funds advised by Alger Management, as
discussed in Note 3(h). For the six months ended April 30, 2015, the Funds had the
following borrowings:
| | | | |
| | AVERAGE DAILY | WEIGHTED AVERAGE |
| | | BORROWING | | INTEREST RATE |
| Alger Spectra Fund | $ | 183,749 | | 2.19% |
| Alger Analyst Fund | | 2,433 | | 2.20 |
| Alger Dynamic Opportunities Fund | | 79,593 | | 2.19 |
| Alger Emerging Markets Fund | | 12,727 | | 2.20 |
The highest amount borrowed during the six months ended April 30, 2015 for each Fund
was as follows:
| | |
| | HIGHEST BORROWING |
| Alger Spectra Fund | $ | 33,255,669 |
| Alger Analyst Fund | | 292,054 |
| Alger Dynamic Opportunities Fund | | 1,806,187 |
| Alger Emerging Markets Fund | | 365,869 |
- 93 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
NOTE 6 — Share Capital:
(a) The Trust has an unlimited number of authorized shares of beneficial interest of $.001
par value which are presently divided into five series. Each series is divided into separate
classes. The transactions of shares of beneficial interest were as follows:
| | | | | | | | |
| | | | | | | | |
| | FOR THE SIX MONTHS ENDED | | FOR THE YEAR ENDED |
| | | APRIL 30, 2015 | | OCTOBER 31, 2014 |
| | | SHARES | | AMOUNT | | SHARES | | AMOUNT |
| Alger Spectra Fund | | | | | | | | |
| Class A: | | | | | | | | |
| Shares sold | | 20,191,082 | $ | 365,970,551 | | 32,338,699 | $ | 579,845,405 |
| Shares converted from Class C | | 719 | | 12,414 | | 22 | | 389 |
| Dividends reinvested | | 11,977,865 | | 207,942,485 | | 5,854,567 | | 100,640,010 |
| Shares redeemed | | (12,277,267) | (222,736,373) | | (49,152,547) | (904,843,079) |
| Net increase (decrease) | | 19,892,399 | $ | 351,189,077 | | (10,959,259) | $ | (224,357,275) |
| Class C: | | | | | | | | |
| Shares sold | | 9,180,680 | $ | 157,799,559 | | 10,495,116 | $ | 181,342,515 |
| Shares converted to Class A | | (755) | | (12,414) | | (23) | | (389) |
| Dividends reinvested | | 4,064,447 | | 67,185,473 | | 1,307,096 | | 21,684,718 |
| Shares redeemed | | (2,988,359) | | (51,707,107) | | (3,642,642) | | (62,917,415) |
| Net increase | | 10,256,013 | $ | 173,265,511 | | 8,159,547 | $ | 140,109,429 |
| Class I: | | | | | | | | |
| Shares sold | | 14,683,540 | $ | 266,756,070 | | 21,286,862 | $ | 384,958,874 |
| Dividends reinvested | | 7,049,801 | | 123,371,317 | | 2,350,328 | | 40,684,169 |
| Shares redeemed | | (14,861,108) | (268,125,903) | | (12,278,080) | (222,493,127) |
| Net increase | | 6,872,233 | $ | 122,001,484 | | 11,359,110 | $ | 203,149,916 |
| Class Z: | | | | | | | | |
| Shares sold | | 10,528,987 | $ | 191,390,079 | | 37,571,892 | $ | 703,742,849 |
| Dividends reinvested | | 4,088,271 | | 71,708,282 | | 358,899 | | 6,208,950 |
| Shares redeemed | | (6,461,086) | (118,246,376) | | (10,885,301) | (198,541,023) |
| Net increase | | 8,156,172 | $ | 144,851,985 | | 27,045,490 | $ | 511,410,776 |
| |
| Alger Green Fund | | | | | | | | |
| Class A: | | | | | | | | |
| Shares sold | | 359,765 | $ | 3,301,070 | | 828,187 | $ | 7,358,641 |
| Dividends reinvested | | 87,670 | | 790,782 | | 121,073 | | 1,054,550 |
| Shares redeemed | | (378,091) | | (3,471,424) | | (968,434) | | (8,610,801) |
| Net increase (decrease) | | 69,344 | $ | 620,428 | | (19,174) | $ | (197,610) |
| Class C: | | | | | | | | |
| Shares sold | | 70,966 | $ | 624,548 | | 185,722 | $ | 1,571,391 |
| Dividends reinvested | | 15,308 | | 131,343 | | 16,476 | | 137,736 |
| Shares redeemed | | (44,498) | | (389,034) | | (83,282) | | (707,199) |
| Net increase | | 41,776 | $ | 366,857 | | 118,916 | $ | 1,001,928 |
| Class I: | | | | | | | | |
| Shares sold | | 540,709 | $ | 4,995,791 | | 1,645,240 | $ | 14,568,124 |
| Dividends reinvested | | 126,542 | | 1,140,144 | | 157,333 | | 1,368,794 |
| Shares redeemed | | (672,543) | | (6,192,738) | | (1,216,946) | | (10,795,073) |
| Net increase (decrease) | | (5,292) $ | $ | (56,803) | | 585,627 | $ | 5,141,845 |
| |
| |
| | | | | | | | | - 94 - |
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
| | | | | | | | |
| | FOR THE SIX MONTHS ENDED | | FOR THE YEAR ENDED |
| | | APRIL 30, 2015 | | OCTOBER 31, 2014 |
| | | SHARES | | AMOUNT | | SHARES | | AMOUNT |
| Alger Analyst Fund | | | | | | | | |
| Class A: | | | | | | | | |
| Shares sold | | 18,741 | $ | 260,277 | | 113,069 | $ | 1,535,251 |
| Dividends reinvested | | 36,998 | | 484,675 | | 35,523 | | 457,530 |
| Shares redeemed | | (9,526) | | (128,198) | | (22,216) | | (302,568) |
| Net increase | | 46,213 | $ | 616,754 | | 126,376 | $ | 1,690,213 |
| Class C: | | | | | | | | |
| Shares sold | | 770 | $ | 10,000 | | 6,256 | $ | 83,134 |
| Dividends reinvested | | 2,094 | | 26,114 | | 2,589 | | 31,952 |
| Shares redeemed | | (3,452) | | (43,800) | | (1,865) | | (24,279) |
| Net increase (decrease) | | (588) | $ | (7,686) | | 6,980 | $ | 90,807 |
| Class I: | | | | | | | | |
| Shares sold | | 3,749 | $ | 49,374 | | 40,453 | $ | 542,527 |
| Dividends reinvested | | 9,914 | | 129,474 | | 12,461 | | 160,368 |
| Shares redeemed | | (6,942) | | (94,827) | | (40,038) | | (538,234) |
| Net increase | | 6,721 | $ | 84,021 | | 12,876 | $ | 164,661 |
| |
| Alger Dynamic Opportunities Fund | | | | | | | | |
| Class A: | | | | | | | | |
| Shares sold | | 1,844,842 | $ | 23,487,710 | | 2,969,594 | $ | 37,388,559 |
| Dividends reinvested | | 184,459 | | 2,266,955 | | 196,268 | | 2,425,867 |
| Shares redeemed | | (1,796,636) | | (22,954,782) | | (2,244,716) | | (28,195,684) |
| Net increase | | 232,665 | $ | 2,799,883 | | 921,146 | $ | 11,618,742 |
| Class C: | | | | | | | | |
| Shares sold | | 171,263 | $ | 2,071,763 | | 388,509 | $ | 4,753,942 |
| Dividends reinvested | | 29,847 | | 354,289 | | 8,722 | | 105,191 |
| Shares redeemed | | (81,905) | | (984,115) | | (43,152) | | (526,803) |
| Net increase | | 119,205 | $ | 1,441,937 | | 354,079 | $ | 4,332,330 |
| Class Z: | | | | | | | | |
| Shares sold | | 437,858 | $ | 5,598,179 | | 742,459 | $ | 9,566,861 |
| Dividends reinvested | | 142,127 | | 1,765,215 | | 101,629 | | 1,265,283 |
| Shares redeemed | | (258,003) | | (3,221,789) | | (127,352) | | (1,598,319) |
| Net increase | | 321,982 | $ | 4,141,605 | | 716,736 | $ | 9,233,825 |
- 95 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
| | | | | | | | |
| | FOR THE SIX MONTHS ENDED | | FOR THE YEAR ENDED |
| | | APRIL 30, 2015 | | OCTOBER 31, 2014 |
| | | SHARES | | AMOUNT | | SHARES | | AMOUNT |
| Alger Emerging Markets Fund | | | | | | | | |
| Class A: | | | | | | | | |
| Shares sold | | 164,933 | $ | 1,515,553 | | 650,411 | $ | 6,150,709 |
| Shares redeemed | | (144,992) | | (1,307,106) | | (466,138) | | (4,431,135) |
| Net increase | | 19,941 | $ | 208,447 | | 184,273 | $ | 1,719,574 |
| Class C: | | | | | | | | |
| Shares sold | | 96,595 | $ | 866,066 | | 187,274 | $ | 1,767,329 |
| Shares redeemed | | (19,288) | | (170,582) | | (5,639) | | (51,737) |
| Net increase | | 77,307 | $ | 695,484 | | 181,635 | $ | 1,715,592 |
| Class I: | | | | | | | | |
| Shares sold | | 95,838 | $ | 868,699 | | 234,530 | $ | 2,208,761 |
| Shares redeemed | | (18,338) | | (163,893) | | (88,851) | | (814,957) |
| Net increase | | 77,500 | $ | 704,806 | | 145,679 | $ | 1,393,804 |
| Class Z: | | | | | | | | |
| Shares sold | | 154,425 | $ | 1,383,034 | | 395,253 | $ | 3,829,565 |
| Shares redeemed | | (159,347) | | (1,424,252) | | (5,520) | | (51,547) |
| Net increase (decrease) | | (4,922) | $ | (41,218) | | 389,733 | $ | 3,778,018 |
(b) Redemption Fee: Prior to March 1, 2015, the Funds imposed a 2.00% redemption fee
on certain Class A and Class C shares redeemed (including shares redeemed by exchange)
within 30 days after such shares were acquired. The fees retained by the Funds are included
as paid-in capital on the accompanying Statement of Assets and Liabilities.
NOTE 7 — Income Tax Information:
At October 31, 2014, the Alger Emerging Markets Fund, for federal income tax purposes,
had capital loss carryforwards as set forth in the table below. These amounts may be applied
against future net realized gains.
| | |
| | Alger Emerging |
| Expiration Dates | Markets Fund |
| POST ACT | $ | 2,015,972 |
| Total | | 2,015,972 |
Under the Regulated Investment Company Modernization Act of 2010, capital losses
incurred by the Funds after October 31, 2011 will not be subject to expiration (“POST
ACT”). In addition, losses incurred after October 31, 2011 must be utilized prior to the
utilization of capital loss carryforwards above.
The difference between book-basis and tax-basis unrealized appreciation (depreciation) is
determined annually and is attributable primarily to the tax deferral of losses on wash sales,
988 currency transactions, nondeductible expenses on dividends sold short, the tax treatment
of partnerships investments, the realization of unrealized appreciation of passive foreign
investment companies, and return of capital from real estate investment trust investments.
- 96 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
NOTE 8 — Fair Value Measurements
The following is a summary of the inputs used as of April 30, 2015 in valuing the Funds’
investments carried at fair value on a recurring basis. Based upon the nature, characteristics,
and risks associated with their investments, the Funds have determined that presenting them
by security type and sector is appropriate.
| | | | | | | | | | | | | |
| Alger Spectra Fund | | TOTAL FUND | | | LEVEL 1 | | | LEVEL 2 | | | LEVEL 3 |
| COMMON STOCKS | | | | | | | | | | | | | |
| Consumer Discretionary | $ 860,383,967 | $ 860,298,387 | | | | — | $ | 85,580 |
| Consumer Staples | | 308,273,773 | 308,273,773 | | | | — | | | — |
| Energy | | 265,975,018 | 265,975,018 | | | | — | | | — |
| Financials | | 251,649,612 | 251,649,612 | | | | — | | | — |
| Health Care | | 958,105,846 | 958,105,846 | | | | — | | | — |
| Industrials | | 473,020,663 | 473,020,663 | | | | — | | | — |
| Information Technology | | 1,606,982,954 1,604,506,598 | | | | — | | 2,476,356 |
| Materials | | 109,055,569 | 109,055,569 | | | | — | | | — |
| Telecommunication Services | | 63,280,561 | 63,280,561 | | | | — | | | — |
| Utilities | | 36,183,953 | 36,183,953 | | | | — | | | — |
| TOTAL COMMON STOCKS | $ 4,932,911,916 | $ 4,930,349,980 | | | | — | $ | | 2,561,936 |
| MASTER LIMITED PARTNERSHIP | | | | | | | | | | | | | |
| Financials | | 146,618,088 | 146,618,088 | | | | — | | | — |
| PREFERRED STOCKS | | | | | | | | | | | | | |
| Consumer Discretionary | | | 2,545,472 | | | — | | | | — | | 2,545,472 |
| Health Care | | 20,632,410 | | | — | | | | — | 20,632,410 |
| Information Technology | | 11,415,105 | | | — | | | | — | 11,415,105 |
| TOTAL PREFERRED STOCKS | $ | 34,592,987 | | | — | | | | — | $ | | 34,592,987 |
| REAL ESTATE INVESTMENT TRUST | | | | | | | | | | | | |
| Financials | | 65,492,775 | 65,492,775 | | | | — | | | — |
| TOTAL INVESTMENTS IN | | | | | | | | | | | | | |
| SECURITIES | $ 5,179,615,766 | $ 5,142,460,843 | | | | — | $ | | 37,154,923 |
| SECURITIES SOLD SHORT | | | | | | | | | | | | | |
| COMMON STOCKS | | | | | | | | | | | | | |
| Consumer Discretionary | | 44,045,582 | 44,045,582 | | | | — | | | — |
| Energy | | 13,217,413 | 13,217,413 | | | | — | | | — |
| Financials | | 21,633,000 | 21,633,000 | | | | — | | | — |
| Health Care | | | 5,407,540 | | 5,407,540 | | | | — | | | — |
| Industrials | | 42,867,905 | 42,867,905 | | | | — | | | — |
| Information Technology | | 45,519,699 | 45,519,699 | | | | — | | | — |
| Materials | | | 8,766,156 | | 8,766,156 | | | | — | | | — |
| TOTAL COMMON STOCKS | $ | 181,457,295 | $ | | 181,457,295 | | | | — | | | — |
- 97 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
| | | | | | | | | | | | |
| Alger Green Fund | | TOTAL FUND | | LEVEL 1 | | | LEVEL 2 | | | LEVEL 3 |
| COMMON STOCKS | | | | | | | | | | | | |
| Consumer Discretionary | $ 18,413,743 | $ 18,412,006 | | | | — | $ | | 1,737 |
| Consumer Staples | | | 6,058,626 | | 6,058,626 | | | | — | | | — |
| Financials | | | 731,546 | | 731,546 | | | | — | | | — |
| Health Care | | | 6,808,974 | | 6,808,974 | | | | — | | | — |
| Industrials | | 16,530,987 | 16,530,987 | | | | — | | | — |
| Information Technology | | 24,438,802 | 24,438,802 | | | | — | | | — |
| Materials | | | 2,471,145 | | 2,471,145 | | | | — | | | — |
| Utilities | | | 3,454,202 | | 3,454,202 | | | | — | | | — |
| TOTAL COMMON STOCKS | $ | 78,908,025 | $ | 78,906,288 | | | | — | $ | | 1,737 |
| PREFERRED STOCKS | | | | | | | | | | | | |
| Consumer Discretionary | | | 48,496 | | — | | | | — | | 48,496 |
| TOTAL INVESTMENTS IN | | | | | | | | | | | | |
| SECURITIES | $ | 78,956,521 | $ | 78,906,288 | | | | — | $ | | 50,233 |
| |
| |
| Alger Analyst Fund | | TOTAL FUND | | LEVEL 1 | | | LEVEL 2 | | | LEVEL 3 |
| COMMON STOCKS | | | | | | | | | | | | |
| Consumer Discretionary | $ | 2,624,932 | $ | 2,624,932 | | | | — | | | — |
| Consumer Staples | | | 253,131 | | 253,131 | | | | — | | | — |
| Energy | | | 756,412 | | 756,412 | | | | — | | | — |
| Financials | | | 271,170 | | 271,170 | | | | — | | | — |
| Health Care | | | 1,293,548 | | 1,293,548 | | | | — | | | — |
| Industrials | | | 1,243,247 | | 1,243,247 | | | | — | | | — |
| Information Technology | | | 1,740,760 | | 1,740,760 | | | | — | | | — |
| Materials | | | 351,514 | | 351,514 | | | | — | | | — |
| Telecommunication Services | | | 117,138 | | 117,138 | | | | — | | | — |
| TOTAL COMMON STOCKS | $ | 8,651,852 | $ | 8,651,852 | | | | — | | | — |
| MASTER LIMITED PARTNERSHIP | | | | | | | | | | | | |
| Energy | | | 122,897 | | 122,897 | | | | — | | | — |
| Financials | | | 135,209 | | 135,209 | | | | — | | | — |
| TOTAL MASTER LIMITED | | | | | | | | | | | | |
| PARTNERSHIP | $ | 258,106 | $ | 258,106 | | | | — | | | — |
| REAL ESTATE INVESTMENT TRUST | | | | | | | | | | | |
| Financials | | | 133,147 | | 133,147 | | | | — | | | — |
| TOTAL INVESTMENTS IN | | | | | | | | | | | | |
| SECURITIES | $ | 9,043,105 | $ | 9,043,105 | | | | — | | | — |
- 98 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
| | | | | | | | | | | | |
| Alger Dynamic Opportunities Fund | | TOTAL FUND | | | LEVEL 1 | | | LEVEL 2 | | | LEVEL 3 |
| COMMON STOCKS | | | | | | | | | | | | |
| Consumer Discretionary | $ | 7,721,068 | $ | 7,721,068 | | | — | | | — |
| Consumer Staples | | | 1,947,482 | | 1,947,482 | | | — | | | — |
| Energy | | | 1,161,631 | | 1,161,631 | | | — | | | — |
| Exchange Traded Funds | | | 151,670 | | 151,670 | | | — | | | — |
| Financials | | | 3,302,712 | | 3,302,712 | | | — | | | — |
| Health Care | | 11,758,549 | 11,758,549 | | | — | | | — |
| Industrials | | | 4,953,879 | | 4,953,879 | | | — | | | — |
| Information Technology | | 23,375,378 | 23,328,409 | | | — | | 46,969 |
| Materials | | | 1,132,895 | | 1,132,895 | | | — | | | — |
| Telecommunication Services | | | 404,888 | | 404,888 | | | — | | | — |
| Utilities | | | 859,777 | | 859,777 | | | — | | | — |
| TOTAL COMMON STOCKS | $ | 56,769,929 | $ | | 56,722,960 | | | — | $ | | 46,969 |
| MASTER LIMITED PARTNERSHIP | | | | | | | | | | | | |
| Energy | | | 652,778 | | 652,778 | | | — | | | — |
| Financials | | | 1,805,721 | | 1,805,721 | | | — | | | — |
| TOTAL MASTER LIMITED | | | | | | | | | | | | |
| PARTNERSHIP | $ | 2,458,499 | $ | | 2,458,499 | | | — | | | — |
| PREFERRED STOCKS | | | | | | | | | | | | |
| Health Care | | | 636,865 | | | — | | | — | | 636,865 |
| Information Technology | | | 216,507 | | | — | | | — | | 216,507 |
| TOTAL PREFERRED STOCKS | $ | 853,372 | | | — | | | — | $ | | 853,372 |
| REAL ESTATE INVESTMENT TRUST | | | | | | | | | | |
| Financials | | | 764,782 | | 764,782 | | | — | | | — |
| RIGHTS | | | | | | | | | | | | |
| Health Care | | | 25,932 | | | — | | | — | | 25,932 |
| U.S. GOVERNMENT AGENCY OBLIGATIONS (EXCLUDING MORTGAGE-BACKED) | | | |
| U.S. Government & Agency | | 24,999,861 | | | — | 24,999,861 | | | — |
| TOTAL INVESTMENTS IN | | | | | | | | | | | | |
| SECURITIES | $ | 85,872,375 | $ | | 59,946,241 | $ | | 24,999,861 | $ | | 926,273 |
| SECURITIES SOLD SHORT | | | | | | | | | | | | |
| COMMON STOCKS | | | | | | | | | | | | |
| Consumer Discretionary | | | 1,996,080 | | 1,996,080 | | | — | | | — |
| Consumer Staples | | | 194,902 | | 194,902 | | | — | | | — |
| Energy | | | 186,293 | | 186,293 | | | — | | | — |
| Financials | | | 2,097,071 | | 2,097,071 | | | — | | | — |
| Health Care | | | 1,456,967 | | 1,456,967 | | | — | | | — |
| Industrials | | | 1,076,568 | | 1,076,568 | | | — | | | — |
| Information Technology | | | 3,109,159 | | 3,109,159 | | | — | | | — |
| Market Indices | | | 695,252 | | 695,252 | | | — | | | — |
| Materials | | | 388,897 | | 388,897 | | | — | | | — |
| TOTAL COMMON STOCKS | $ | 11,201,189 | $ | | 11,201,189 | | | — | | | — |
| REAL ESTATE INVESTMENT TRUST | | | | | | | | | | | |
| Financials | | | 177,937 | | 177,937 | | | — | | | — |
| TOTAL SECURITIES SOLD SHORT | | $ | (11,379,126) | $ | | (11,379,126) | | | — | | | — |
- 99 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
| | | | | | | | | | |
| Alger Emerging Markets Fund | TOTAL FUND | | LEVEL 1 | | | LEVEL 2 | | | LEVEL 3 |
| COMMON STOCKS | | | | | | | | | | |
| Consumer Discretionary | $ | 3,906,420 | $ | 3,906,420 | | | — | | | — |
| Consumer Staples | | 2,126,853 | | 2,126,853 | | | — | | | — |
| Energy | | 664,137 | | 664,137 | | | — | | | — |
| Financials | | 6,267,245 | | 6,267,245 | | | — | | | — |
| Health Care | | 1,233,569 | | 1,233,569 | | | — | | | — |
| Industrials | | 2,534,544 | | 2,534,544 | | | — | | | — |
| Information Technology | | 5,665,264 | | 5,665,264 | | | — | | | — |
| Materials | | 1,506,254 | | 1,506,254 | | | — | | | — |
| Telecommunication Services | | 1,158,802 | | 1,158,802 | | | — | | | — |
| Utilities | | 778,787 | | 778,787 | | | — | | | — |
| TOTAL COMMON STOCKS | $ | 25,841,875 | $ | 25,841,875 | | | — | | | — |
| TOTAL INVESTMENTS IN | | | | | | | | | | |
| SECURITIES | $ | 25,841,875 | $ | 25,841,875 | | | — | | | — |
| | | |
| | | FAIR VALUE |
| | MEASUREMENTS |
| | USING SIGNIFICANT |
| | UNOBSERVABLE |
| | INPUTS (LEVEL 3) |
| Alger Spectra Fund | Common Stocks |
| Opening balance at November 1, 2014 | $ | 2,208,793 |
| Transfers into Level 3 | | | — |
| Transfers out of Level 3 | | | — |
| Total gains or losses | | | |
| Included in net realized gain (loss) on investments | | – |
| Included in net unrealized gain (loss) on investments | | 353,143 |
| Purchases and sales | | | – |
| Purchases | | – |
| Sales | | – |
| Closing balance at April 30, 2015 | | | 2,561,936 |
| The amount of total gains or losses for the period included in net realized | | | |
| and unrealized gain (loss) attributable to change in unrealized appreciation | | | |
| (depreciation) relating to investments still held at 4/30/2015 | $ | 353,143 |
| |
| Alger Spectra Fund | Preferred Stocks |
| Opening balance at November 1, 2014 | $ | 20,225,421 |
| Transfers into Level 3 | | | — |
| Transfers out of Level 3 | | | — |
| Total gains or losses | | | |
| Included in net realized gain (loss) on investments | | – |
| Included in net unrealized gain (loss) on investments | | 1,263,512 |
| Purchases and sales | | | – |
| Purchases | | 13,104,054 |
| Sales | | – |
| Closing balance at April 30, 2015 | | | 34,592,987 |
| The amount of total gains or losses for the period included in net realized | | | |
| and unrealized gain (loss) attributable to change in unrealized appreciation | | | |
| (depreciation) relating to investments still held at 4/30/2015 | $ | 1,263,512 |
- 100 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
| | | |
| | | FAIR VALUE |
| | MEASUREMENTS |
| | USING SIGNIFICANT |
| | UNOBSERVABLE |
| | INPUTS (LEVEL 3) |
| |
| |
| Alger Green Fund | Common Stocks |
| Opening balance at November 1, 2014 | $ | 2,063 |
| Transfers into Level 3 | | | — |
| Transfers out of Level 3 | | | — |
| Total gains or losses | | | |
| Included in net realized gain (loss) on investments | | – |
| Included in net unrealized gain (loss) on investments | | (326) |
| Purchases and sales | | | – |
| Purchases | | – |
| Sales | | – |
| Closing balance at April 30, 2015 | | | 1,737 |
| The amount of total gains or losses for the period included in net realized | | | |
| and unrealized gain (loss) attributable to change in unrealized appreciation | | | |
| (depreciation) relating to investments still held at 4/30/2015 | $ | (326) |
| |
| Alger Green Fund | Preferred Stocks |
| Opening balance at November 1, 2014 | $ | 57,589 |
| Transfers into Level 3 | | | — |
| Transfers out of Level 3 | | | — |
| Total gains or losses | | | |
| Included in net realized gain (loss) on investments | | – |
| Included in net unrealized gain (loss) on investments | | (9,093) |
| Purchases and sales | | | – |
| Purchases | | – |
| Sales | | – |
| Closing balance at April 30, 2015 | | | 48,496 |
| The amount of total gains or losses for the period included in net realized | | | |
| and unrealized gain (loss) attributable to change in unrealized appreciation | | | |
| (depreciation) relating to investments still held at 4/30/2015 | $ | (9,093) |
- 101 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
| | | |
| | | FAIR VALUE |
| | MEASUREMENTS |
| | USING SIGNIFICANT |
| | UNOBSERVABLE |
| | INPUTS (LEVEL 3) |
| Alger Dynamic Opportunities Fund | Common Stocks |
| Opening balance at November 1, 2014 | $ | 39,966 |
| Transfers into Level 3 | | | — |
| Transfers out of Level 3 | | | — |
| Total gains or losses | | | |
| Included in net realized gain (loss) on investments | | – |
| Included in net unrealized gain (loss) on investments | | 7,003 |
| Purchases and sales | | | – |
| Purchases | | – |
| Sales | | – |
| Closing balance at April 30, 2015 | | | 46,969 |
| The amount of total gains or losses for the period included in net realized | | | |
| and unrealized gain (loss) attributable to change in unrealized appreciation | | | |
| (depreciation) relating to investments still held at 4/30/2015 | $ | 7,003 |
| |
| Alger Dynamic Opportunities Fund | Preferred Stocks |
| Opening balance at November 1, 2014 | $ | 314,186 |
| Transfers into Level 3 | | | 320,069 |
| Transfers out of Level 3 | | | — |
| Total gains or losses | | | |
| Included in net realized gain (loss) on investments | | – |
| Included in net unrealized gain (loss) on investments | | 32,736 |
| Purchases and sales | | | – |
| Purchases | | 186,381 |
| Sales | | – |
| Closing balance at April 30, 2015 | | | 853,372 |
| The amount of total gains or losses for the period included in net realized | | | |
| and unrealized gain (loss) attributable to change in unrealized appreciation | | | |
| (depreciation) relating to investments still held at 4/30/2015 | $ | 32,736 |
| |
| Alger Dynamic Opportunities Fund | | | Rights |
| Opening balance at November 1, 2014 | $ | 25,932 |
| Transfers into Level 3 | | | — |
| Transfers out of Level 3 | | | — |
| Total gains or losses | | | |
| Included in net realized gain (loss) on investments | | – |
| Included in net unrealized gain (loss) on investments | | – |
| Purchases and sales | | | – |
| Purchases | | – |
| Sales | | – |
| Closing balance at April 30, 2015 | | | 25,932 |
| The amount of total gains or losses for the period included in net realized | | | |
| and unrealized gain (loss) attributable to change in unrealized appreciation | | | |
| (depreciation) relating to investments still held at 4/30/2015 | $ | — |
- 102 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
The following table provides quantitative information about our Level 3 fair value
measurements of our investments as of April 30, 2015. In addition to the techniques and
inputs noted in the table below, according to our valuation policy we may also use other
valuation techniques and methodologies when determining our fair value measurements.
The table below is not intended to be all-inclusive, but rather provides information on the
Level 3 inputs as they relate to our fair value measurements.
| | | | | |
| | | Fair Value | Valuation | Unobservable | |
| | | April 30, 2015 | Methodology | Input | Input |
| Alger Spectra Fund | | | | | |
| Common Stocks | $ 85,580 | Income | Discount Rate | 10% |
| | | | Approach | | |
| Common Stocks | | 2,476,356 | Income | Discount Rate | 40% |
| | | | Approach | | |
| Preferred Stocks | | 18,943,461 | Income | Discount Rate | 10% |
| | | | Approach | | |
| Preferred Stocks | | 13,104,054 | Income | Discount Rate | 12% |
| | | | Approach | | |
| Preferred Stocks | | 2,545,472 | Income | Discount Rate | 40% |
| | | | Approach | | |
| Alger Green Fund | | | | | |
| Common Stocks | $ 1,737 | Income | Discount Rate | 40% |
| | | | Approach | | |
| Preferred Stocks | | 48,496 | Income | Discount Rate | 40% |
| | | | Approach | | |
| Alger Dynamic Opportunities Fund | | | | |
| Common Stocks | $ 46,969 | Income | Discount Rate | 10% |
| | | | Approach | | |
| Preferred Stocks | | 346,922 | Income | Discount Rate | 10% |
| | | | Approach | | |
| Preferred Stocks | | 186,381 | Income | Discount Rate | 12% |
| | | | Approach | | |
| Preferred Stocks | | 320,069 | Income | Discount Rate | 15% |
| | | | Approach | | |
| *Rights | | 25,932 | Cost Approach | Probability of | 0%-44% |
| | | | | Success | |
*The above amounts exclude $25,932 of investments where the determination of fair value
approximates cost without adjustments.
The significant unobservable inputs used in the fair value measurement of the Fund’s
securities are revenue and EBITDA multiples, discount rates, and the probabilities of
success of certain outcomes. Significant increases and decreases in these inputs in isolation
and interrelationships between those inputs could result in significantly higher or lower fair
value measurements as noted in the table above.
On April 30, 2015, the Alger Emerging Markets Fund transferred $125,968 from Level 2 to
Level 1, utilizing exchange listed prices rather than fair value adjusted prices.
Certain of the Fund’s assets and liabilities are held at carrying amount or face value, which
approximates fair value for financial statement purposes. As of April 30, 2015, such assets
are categorized within the ASC 820 disclosure hierarchy as follows:
- 103 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
| | | | | | | | | |
| | TOTAL FUND | LEVEL 1 | | LEVEL 2 | | LEVEL 3 |
| Cash, Foreign cash and Cash equivalents: | | | | | | | | | |
| Alger Spectra Fund | | $ 3,229,277 | $ 3,229,277 | | | — | | | — |
| Alger Green Fund | | 3,249,284 | 3,249,284 | | | — | | | — |
| Alger Analyst Fund | | 213,958 | 213,958 | | | — | | | — |
| Alger Dynamic Opportunities Fund | 14,799,064 | 14,799,064 | | | — | | | — |
| Alger Emerging Markets Fund | | 798,277 | 798,277 | | | — | | | — |
| Total | $ 21,244,602 | $ 21,244,602 | | | — | | | — |
NOTE 9 — Derivatives:
Financial Accounting Standards Board Accounting Standards Codification 815 – Derivatives
and Hedging (“ASC 815”) requires qualitative disclosures about objectives and strategies for
using derivatives, quantitative disclosures about fair value amounts of and gains and losses
on derivative instruments, and disclosures about credit-risk-related contingent features in
derivative agreements.
Options—The Funds seek to capture the majority of the returns associated with equity
market investments. To meet this investment goal, the Funds invest in a broadly diversified
portfolio of common stocks, while also buying and selling call and put options on equities
and equity indices. The Funds purchase call options to increase their exposure to the stock
market and also provide diversification of risk. The Funds purchase put options in order
to protect from significant market declines that may occur over a short period of time. The
Funds will write covered call and cash secured put options to generate cash flows while
reducing the volatility of the Funds’ portfolios. The cash flows may be an important source
of the Funds’ returns, although written call options may reduce the Funds’ ability to profit
from increases in the value of the underlying security or equity portfolio. The value of a
call option generally increases as the price of the underlying stock increases and decreases
as the stock decreases in price. Conversely, the value of a put option generally increases
as the price of the underlying stock decreases and decreases as the stock increases in price.
The combination of the diversified stock portfolio and the purchase and sale of options
is intended to provide the Funds with the majority of the returns associated with equity
market investments but with reduced volatility and returns that are augmented with the cash
flows from the sale of options. During the six months ended April 30, 2015, options were
used in accordance with these objectives.
The Funds’ option contracts were not subject to any rights of offset with any counterparty.
All of the Funds’ options were exchange traded which utilize a clearing house that acts as an
intermediary between buyer and seller, receiving initial and maintenance margin from both,
and guaranteeing performance of the option contract.
There were no open derivative instruments as of April 30, 2015.
For the six months ended April 30, 2015, Alger Dynamic Opportunities Fund had option
purchases of $70,851 and option sales of $48,362 The effect of derivative instruments on
the accompanying Statement of Operations for the six months ended April 30, 2015, is as
follows
- 104 -
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
| | |
| NET REALIZED LOSS ON INVESTMENTS, OPTIONS | | |
| Alger Dynamic Opportunities Fund | | |
| Derivatives not accounted for as hedging instruments | | Options |
| Purchased Options | $ | (22,488) |
| Total | $ | (22,488) |
NOTE 10 — Affiliated Securities:
The securities listed below are deemed to be affiliate’s of the Funds because the Funds or
affiliates owned 5% or more of the company’s voting securities during all or part of the six
months ended April 30, 2015. Purchase and sale transactions and dividend income earned
during the year were as follows:
| | | | | | | |
| | Shares/Par | | | Shares/Par | | | |
| | at | | | at | | Realized | |
| | October 31, Purchases/ | Sales/ | April | Dividend | Gain | Value at April |
| Security | 2014 | Conversion Conversion | 30, 2015 | Income | (Loss) | 30, 2015 |
| |
| Alger Spectra Fund | | | | | | | |
| Common Stocks | | | | | | | |
| Choicestream, Inc.* | 178,292 | – | – | 178,292 | – | – | 85,580 |
| Preferred Stocks | | | | | | | |
| Choicestream, Inc.* | 5,303,067 | – | – | 5,303,067 | – | – | 2,545,472 |
| Prosetta Biosciences, | | | | | | | |
| Inc.* | – | 2,912,012 | – | 2,912,012 | – | – | 13,104,054 |
| Alger Green Fund | | | | | | | |
| Common Stocks | | | | | | | |
| Choicestream, Inc.* | 3,619 | – | – | 3,619 | – | – | 85,580 |
| Preferred Stocks | | | | | | | |
| Choicestream, Inc.* | 101,034 | – | – | 101,034 | – | – | 48,496 |
| Alger Dynamic | | | | | | | |
| Opportunities Fund | | | | | | | |
| Preferred Stocks | | | | | | | |
| Prosetta Biosciences, | | | | | | | |
| Inc.* | 41,418 | – | – | 41,418 | – | – | 186,381 |
| Tolero | | | | | | | |
| Pharmaceuticals, Inc.* | 106,120 | – | – | 106,120 | – | – | 320,069 |
| |
| * Non-income producing security. | | | | | |
NOTE 11 — Subsequent Events:
Management of each Fund has evaluated events that have occurred subsequent to April
30, 2015 through the issuance date of the Financial Statements. No such events have been
identified which require recognition and disclosure.
- 105 -
THE ALGER FUNDS II
ADDITIONAL INFORMATION (Unaudited)
Shareholder Expense Example
As a shareholder of a Fund, you incur two types of costs: transaction costs, if applicable,
including sales charges (loads) and redemption fees; and ongoing costs, including
management fees, distribution (12b-1) fees, if applicable, and other fund expenses. This
example is intended to help you understand your ongoing costs (in dollars) of investing in
the Fund and to compare these costs with the ongoing costs of investing in other mutual
funds.
The example below is based on an investment of $1,000 invested at the beginning of the
six-month period starting November 1, 2014 and ending April 30, 2015.
Actual Expenses
The first line for each class of shares in the table below provides information about actual
account values and actual expenses. You may use the information in this line, together
with the amount you invested, to estimate the expenses that you would have paid over the
period. Simply divide your account value by $1,000 (for example, an $8,600 account value
divided by $1,000 = 8.6), then multiply the result by the number in the first line under the
heading entitled “Expenses Paid during the Period” to estimate the expenses you paid on
your account during this period.
Hypothetical Example for Comparison Purposes
The second line for each class of shares in the table below provides information about
hypothetical account values and hypothetical expenses based on the Fund’s actual expense
ratios for each class of shares and an assumed rate of return of 5% per year before expenses,
which is not the Fund’s actual return. The hypothetical account values and expenses may not
be used to estimate the actual ending account balance or expenses you paid for the period.
You may use this information to compare the ongoing costs of investing in the Fund and
other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical
examples that appear in the shareholder reports of other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs
only and do not reflect any transaction costs, such as sales charges (loads) and redemption
fees. Therefore, the second line under each class of shares in the table is useful in comparing
ongoing costs only, and will not help you determine the relative total costs of owning
different funds. In addition, if these transactional costs were included, your costs would
have been higher.
- 106 -
THE ALGER FUNDS II
ADDITIONAL INFORMATION (Unaudited) (Continued)
| | | | | | | | |
| | | | | | | | Annualized |
| | | | | | Expenses | Expense Ratio |
| | | Beginning | Ending | Paid During | | For the |
| | | | Account | Account | the Six Months | Six Months |
| | | | Value | Value | | Ended | | Ended |
| | | November 1, 2014 | April 30, 2015 | April 30, 2015(a) | April 30, 2015(b) |
| Alger Spectra Fund | | | | | | | |
| Class A | Actual | $ | 1,000.00 | $ 1,074.64 | $ | 7.00 | | 1.36% |
| | Hypothetical(c) | | 1,000.00 | 1,018.05 | | 6.80 | | 1.36 |
| Class C | Actual | | 1,000.00 | 1,070.37 | 10.83 | | 2.11 |
| | Hypothetical(c) | | 1,000.00 | 1,014.33 | 10.54 | | 2.11 |
| Class I | Actual | | 1,000.00 | 1,074.64 | | 6.89 | | 1.34 |
| | Hypothetical(c) | | 1,000.00 | 1,018.15 | | 6.71 | | 1.34 |
| Class Z | Actual | | 1,000.00 | 1,075.65 | | 5.40 | | 1.05 |
| | Hypothetical(c) | | 1,000.00 | 1,019.59 | | 5.26 | | 1.05 |
| | | | | | | | | |
| Alger Green Fund | | | | | | | |
| Class A | Actual | $ | 1,000.00 | $ 1,054.16 | $ | 6.52 | | 1.28% |
| | Hypothetical(c) | | 1,000.00 | 1,018.45 | | 6.41 | | 1.28 |
| Class C | Actual | | 1,000.00 | 1,049.83 | 10.52 | | 2.07 |
| | Hypothetical(c) | | 1,000.00 | 1,014.53 | 10.34 | | 2.07 |
| Class I | Actual | | 1,000.00 | 1,054.25 | | 6.52 | | 1.28 |
| | Hypothetical(c) | | 1,000.00 | 1,018.45 | | 6.41 | | 1.28 |
| | | | | | | | | |
| Alger Analyst Fund | | | | | | | |
| Class A | Actual | $ | 1,000.00 | $ 1,050.41 | $ | 6.91 | | 1.36% |
| | Hypothetical(c) | | 1,000.00 | 1,018.05 | | 6.80 | | 1.36 |
| Class C | Actual | | 1,000.00 | 1,046.80 | | 9.90 | | 1.95 |
| | Hypothetical(c) | | 1,000.00 | 1,015.12 | | 9.74 | | 1.95 |
| Class I | Actual | | 1,000.00 | 1,050.21 | | 6.96 | | 1.36 |
| | Hypothetical(c) | | 1,000.00 | 1,018.00 | | 6.85 | | 1.36 |
| | | | | | | | | |
| Alger Dynamic Opportunities Fund | | | | | | | |
| Class A | Actual | $ | 1,000.00 | $ 1,031.93 | $ | 11.13 | | 2.21% |
| | Hypothetical(c) | | 1,000.00 | 1,013.84 | | 11.03 | | 2.21 |
| Class C | Actual | | 1,000.00 | 1,027.96 | 14.93 | | 2.97 |
| | Hypothetical(c) | | 1,000.00 | 1,010.07 | 14.80 | | 2.97 |
| Class Z | Actual | | 1,000.00 | 1,033.18 | | 9.78 | | 1.94 |
| | Hypothetical(c) | | 1,000.00 | 1,015.17 | | 9.69 | | 1.94 |
| | | | | | | | | |
- 107 -
THE ALGER FUNDS II
ADDITIONAL INFORMATION (Unaudited) (Continued)
| | | | | | | | |
| | | | | | | | Annualized |
| | | | | | Expenses | Expense Ratio |
| | | Beginning | Ending | Paid During | | For the |
| | | | Account | Account | the Six Months | Six Months |
| | | | Value | Value | | Ended | | Ended |
| | | November 1, 2014 | April 30, 2015 | April 30, 2015(a) | April 30, 2015(b) |
| Alger Emerging Markets Fund | | | | | | | |
| Class A | Actual | $ | 1,000.00 | $ 1,036.02 | $ | 8.63 | | 1.70% |
| | Hypothetical(c) | | 1,000.00 | 1,016.31 | | 8.55 | | 1.70 |
| Class C | Actual | | 1,000.00 | 1,031.42 | 12.39 | | 2.45 |
| | Hypothetical(c) | | 1,000.00 | 1,012.60 | 12.28 | | 2.45 |
| Class I | Actual | | 1,000.00 | 1,036.25 | | 8.63 | | 1.70 |
| | Hypothetical(c) | | 1,000.00 | 1,016.31 | | 8.55 | | 1.70 |
| Class Z | Actual | | 1,000.00 | 1,038.26 | | 6.37 | | 1.25 |
| | Hypothetical(c) | | 1,000.00 | 1,018.55 | | 6.31 | | 1.25 |
| | | | | | | | | |
(a) Expenses are equal to the annualized expense ratio of the respective share class, multiplied by the average account
value over the period, multiple by 181/365 (to reflect the one-half year period).
(b) Annualized.
(c) 5% annual return before expenses.
- 108 -
THE ALGER FUNDS II
ADDITIONAL INFORMATION (Unaudited) (Continued)
| | |
| Privacy Policy | | |
| |
| U.S. Consumer Privacy Notice Rev. 01/2015 | 3/30/15 |
| FACTS | WHAT DOES ALGER DO WITH YOUR PERSONAL INFORMATION? |
| |
| |
| Why? | Financial companies choose how they share your personal information. Federal law |
| | gives consumers the right to limit some but not all sharing. Federal law also requires us |
| | to tell you how we collect, share, and protect your personal information. Please read this |
| | notice carefully to understand what we do. | |
| What? | The types of personal information we collect and share depend on the product or service |
| | you have with us. | |
| | This information can include: | |
| | • Social Security number and | |
| | • Account balances and | |
| | • Transaction history and | |
| | • Purchase history and | |
| | • Assets | |
| | When you are no longer our customer, we continue to share your information as |
| | described in this notice. | |
| How? | All financial companies need to share personal information to run their everyday business. |
| | In the section below, we list the reasons financial companies can share their personal |
| | information; the reasons chooses to share; and whether you can limit this sharing. |
| | |
| Reasons we can share your personal | Does | Can you limit |
| information | Alger share? | this sharing? |
| For our everyday business purposes — | Yes | No |
| such as to process your transactions, maintain | | |
| your account(s), respond to court orders and | | |
| legal investigations, or report to credit bureaus | | |
| For our marketing purposes —to offer our | Yes | No |
| products and services to you | | |
| For joint marketing with other financial | No | We don’t share |
| companies | | |
| For our affiliates’ everyday business | Yes | No |
| purposes — information about your | | |
| transactions and experiences | | |
| For our affiliates’ everyday business | No | We don’t share |
| purposes — information about your | | |
| creditworthiness | | |
| For nonaffiliates to market to you — for all | No | We don’t share |
| credit card accounts | | |
| For nonaffiliates to market to you | No | We don’t share |
| Question? Call 1-800-342-2186 | | |
- 109 -
THE ALGER FUNDS II
ADDITIONAL INFORMATION (Unaudited) (Continued)
| |
| Who we are | |
| |
| Who is providing this notice? | Alger includes Fred Alger Management, Inc. and Fred |
| | Alger & Company, Incorporated as well as the following |
| | funds: The Alger Funds, The Alger Funds II, The Alger |
| | Institutional Funds, The Alger Portfolios, and Alger |
| | Global Growth Fund. |
| |
| |
| What we do | |
| How does Alger | To protect your personal information from unauthorized |
| protect my personal | access and use, we use security measures that comply |
| information? | with federal law. These measures include computer |
| | safeguards and secured files and buildings. |
| How does Alger | We collect your personal information, for example, |
| collect my personal | when you: |
| information? | • Open an account or |
| | • Make deposits or withdrawals from your account or |
| | • Give us your contact information or |
| | • Provide account information or |
| | • Pay us by check. |
| |
| |
| Why can’t I limit all sharing? | Federal law gives you the right to limit only |
| | • sharing for affiliates’ everyday business purposes |
| | information about your credit worthiness |
| | • affiliates from using your information to market to you |
| | • sharing for nonaffiliates to market to you |
| | State laws and individual companies may give you |
| | additional rights to limit sharing. |
| |
| |
| Definitions | |
| Affiliates | Companies related by common ownership or control. |
| | They can be financial and nonfinancial companies. |
| | • Our affiliates include Fred Alger Management, Inc. |
| | and Fred Alger & Company, Incorporated as well as |
| | the following funds: The Alger Funds, The Alger |
| | Funds II, The Alger Institutional Funds, The Alger |
| | Portfolios, and Alger Global Growth Fund. |
| Nonaffiliates | Companies not related by common ownership or |
| | control. They can be financial and nonfinancial |
| | companies |
| Joint marketing | A formal agreement between nonaffiliated financial |
| | companies that together market financial products or |
| | services to you. |
| Other important information | |
- 110 -
THE ALGER FUNDS II
ADDITIONAL INFORMATION (Unaudited) (Continued)
Proxy Voting Policies
A description of the policies and procedures the Trust uses to determine how to vote
proxies relating to portfolio securities and information regarding how the Fund voted
proxies relating to portfolio securities during the most recent 12-month period ended June
30 are available, without charge, by calling (800) 992-3863 or online on the Funds’ website
at www.alger.com or on the SEC’s website at www.sec.gov.
Fund Holdings
The Board of Trustees has adopted policies and procedures relating to disclosure of the
Funds’ portfolio securities. These policies and procedures recognize that there may be
legitimate business reasons for holdings to be disclosed and seek to balance those interests
to protect the proprietary nature of the trading strategies and implementation thereof by
the Funds.
Generally, the policies prohibit the release of information concerning portfolio holdings
which have not previously been made public to individual investors, institutional investors,
intermediaries that distribute the Funds’ shares and other parties which are not employed
by the Manager or its affiliates except when the legitimate business purposes for selective
disclosure and other conditions (designed to protect the Funds) are acceptable.
The Funds make their full holdings available semi-annually in shareholder reports filed on
Form N-CSR and after the first and third fiscal quarters in regulatory filings on Form N-Q.
These shareholder reports and regulatory filings are filed with the SEC, as required by federal
securities laws, and are generally available within sixty (60) days of the end of the Funds’
fiscal quarter. The Funds’ Forms N-Q are available online on the SEC’s website at www.
sec.gov or may be reviewed and copied at the SEC’s Public Reference Room in Washington,
D.C. Information regarding the operation of the SEC’s Public Reference Room may be
obtained by calling 1-800-SEC-0330.
In addition, the Funds make publicly available their respective month-end top 10 holdings
with a 15 day lag and their month-end full portfolios with a 60 day lag on their website www.
alger.com and through other marketing communications (including printed advertising/
sales literature and/or shareholder telephone customer service centers). No compensation
or other consideration is received for the non-public disclosure of portfolio holdings
information.
In accordance with the foregoing, the Funds provide portfolio holdings information to
service providers who provide necessary or beneficial services when such service providers
need access to this information in the performance of their services and are subject to
duties of confidentiality (1) imposed by law, including a duty not to trade on non-public
information, and/or (2) pursuant to an agreement that confidential information is not to be
disclosed or used (including trading on such information) other than as required by law. From
time to time, the Funds will communicate with these service providers to confirm that they
understand the Funds’ policies and procedures regarding such disclosure. This agreement
must be approved by the Funds’ Chief Compliance Officer, President or Secretary.
- 111 -
THE ALGER FUNDS II
ADDITIONAL INFORMATION (Unaudited) (Continued)
The Board of Trustees periodically reviews a report disclosing the third parties to whom
each Fund’s holdings information has been disclosed and the purpose for such disclosure,
and it considers whether or not the release of information to such third parties is in the best
interest of the Fund and its shareholders.
In addition to material the Funds routinely provide to shareholders, the Manager may,
upon request, make additional statistical information available regarding the Funds. Such
information will include, but not be limited to, relative weightings and characteristics of a
Fund portfolios versus its peers or an index (such as P/E ratio, alpha, beta, capture ratio,
standard deviation, EPS forecasts, Sharpe ratio, information ratio, R-squared, and market
cap analysis), security specific impact on overall portfolio performance month-end top
ten contributors to and detractors from performance, breakdown of High Unit Volume
Growth holdings vs. Positive Lifecycle Change holdings, portfolio turnover, and requests
of a similar nature. Please contact the Funds at (800) 992-3863 to obtain such information.
- 112 -
THE ALGER FUNDS II
360 Park Avenue South
New York, NY 10010
(800) 992-3863
www.alger.com
Investment Manager
Fred Alger Management, Inc.
360 Park Avenue South
New York, NY 10010
Distributor
Fred Alger & Company, Incorporated
360 Park Avenue South
New York, NY 10010
Transfer Agent and Dividend Disbursing Agent
State Street Bank and Trust Company
c/o Boston Financial Data Services, Inc.
P.O. Box 8480
Boston, MA 02266-8480
This report is submitted for the general information of the shareholders of The Alger
Funds II. It is not authorized for distribution to prospective investors unless accompanied
by an effective Prospectus for the Trust, which contains information concerning the Trust’s
investment policies, fees and expenses as well as other pertinent information.
- 113 -
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AFIISAR
ITEM 2. CODE OF ETHICS.
Not applicable.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. INVESTMENTS.
Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The Registrant’s principal executive officer and principal financial officer have concluded
that the Registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under
the Investment Company Act of 1940, as amended) are effective based on their evaluation
of the disclosure controls and procedures as of a date within 90 days of the filing date of
this document.
(b) No changes in the Registrant’s internal control over financial reporting occurred during
the Registrant’s second fiscal quarter of the period covered by this report that materially
affected, or are reasonably likely to materially affect, the Registrant’s internal control over
financial reporting.
ITEM 12. EXHIBITS.
| (a) | (1) Not applicable |
| (a) | (2) Certifications of principal executive officer and principal financial officer as required by |
rule 30a-2(a) under the Investment Company Act of 1940 are attached as Exhibit 99.CERT
| (a) | (3) Not applicable |
| (b) | Certifications of principal executive officer and principal financial officer as required by rule |
30a-2(b) under the Investment Company Act of 1940 are attached as Exhibit 99.906CERT
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment
Company Act of 1940, the registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
The Alger Funds II
By: /s/Hal Liebes
Hal Liebes
President
Date: June 29, 2015
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: /s/Hal Liebes
Hal Liebes
President
Date: June 29, 2015
By: /s/Michael D. Martins
Michael D. Martins
Treasurer
Date: June 29, 2015
