THE ALGER FUNDS II
QUARTERLY REPORT
JULY 31, 2022
THE ALGER FUNDS II | ALGER SPECTRA FUND
Schedule of Investments July 31, 2022 (Unaudited)
| | | | | | |
COMMON STOCKS—110.1% | | SHARES | | | VALUE | |
AEROSPACE & DEFENSE—4.1% | | | | | | | | |
HEICO Corp., Cl. A+ | | | 795,575 | | | $ | 101,579,016 | |
TransDigm Group, Inc.*,+ | | | 117,516 | | | | 73,134,907 | |
| | | | | | | 174,713,923 | |
AIR FREIGHT & LOGISTICS—0.4% | | | | | | | | |
GXO Logistics, Inc.* | | | 387,037 | | | | 18,577,776 | |
APPAREL ACCESSORIES & LUXURY GOODS—0.3% | | | | | | | | |
Lululemon Athletica, Inc.* | | | 35,316 | | | | 10,965,971 | |
APPAREL RETAIL—0.5% | | | | | | | | |
Aritzia, Inc.* | | | 673,627 | | | | 21,250,561 | |
APPLICATION SOFTWARE—6.2% | | | | | | | | |
Avalara, Inc.* | | | 182,988 | | | | 15,996,811 | |
Cadence Design Systems, Inc.* | | | 248,158 | | | | 46,177,240 | |
Datadog, Inc., Cl. A*,+ | | | 910,776 | | | | 92,908,260 | |
Intuit, Inc. + | | | 120,070 | | | | 54,772,332 | |
Paycom Software, Inc.* | | | 33,314 | | | | 11,009,944 | |
Paylocity Holding Corp.* | | | 108,171 | | | | 22,275,654 | |
The Trade Desk, Inc., Cl. A* | | | 450,211 | | | | 20,259,495 | |
| | | | | | | 263,399,736 | |
AUTOMOBILE MANUFACTURERS—4.4% | | | | | | | | |
Rivian Automotive, Inc., Cl. A* | | | 514,014 | | | | 17,630,680 | |
Tesla, Inc.*,+ | | | 189,019 | | | | 168,500,988 | |
| | | | | | | 186,131,668 | |
BIOTECHNOLOGY—6.8% | | | | | | | | |
AbbVie, Inc. | | | 500,743 | | | | 71,861,628 | |
Alkermes PLC* | | | 1,181,169 | | | | 30,237,927 | |
BioNTech SE# | | | 105,035 | | | | 17,346,530 | |
Celldex Therapeutics, Inc.* | | | 156,922 | | | | 4,820,644 | |
Natera, Inc.*,+ | | | 2,012,926 | | | | 94,607,522 | |
Seagen, Inc.* | | | 114,094 | | | | 20,534,638 | |
United Therapeutics Corp.* | | | 130,609 | | | | 30,179,822 | |
Vertex Pharmaceuticals, Inc.* | | | 68,030 | | | | 19,076,292 | |
| | | | | | | 288,665,003 | |
CASINOS & GAMING—1.8% | | | | | | | | |
MGM Resorts International+ | | | 2,380,976 | | | | 77,929,345 | |
CONSUMER FINANCE—0.8% | | | | | | | | |
American Express Co. | | | 232,674 | | | | 35,836,450 | |
DATA PROCESSING & OUTSOURCED SERVICES—3.5% | | | | | | | | |
Marqeta, Inc., Cl. A* | | | 3,357,760 | | | | 32,200,918 | |
Visa, Inc., Cl. A+ | | | 541,288 | | | | 114,812,598 | |
| | | | | | | 147,013,516 | |
ELECTRIC UTILITIES—1.3% | | | | | | | | |
NextEra Energy, Inc. + | | | 638,872 | | | | 53,978,295 | |
ELECTRICAL COMPONENTS & EQUIPMENT—1.6% | | | | | | | | |
Eaton Corp., PLC | | | 152,730 | | | | 22,663,605 | |
Generac Holdings, Inc.* | | | 176,552 | | | | 47,368,901 | |
| | | | | | | 70,032,506 | |
ELECTRONIC COMPONENTS—0.8% | | | | | | | | |
II-VI, Inc.* | | | 682,770 | | | | 35,941,013 | |
THE ALGER FUNDS II | ALGER SPECTRA FUND
Schedule of Investments July 31, 2022 (Unaudited) (Continued)
| | | | | | |
COMMON STOCKS—110.1% (CONT.) | | SHARES | | | VALUE | |
ELECTRONIC EQUIPMENT & INSTRUMENTS—0.7% | | | | | | | | |
Zebra Technologies Corp., Cl. A* | | | 79,471 | | | $ | 28,425,982 | |
FINANCIAL EXCHANGES & DATA—1.5% | | | | | | | | |
CME Group, Inc., Cl. A | | | 104,365 | | | | 20,818,730 | |
S&P Global, Inc. + | | | 111,526 | | | | 42,037,495 | |
| | | | | | | 62,856,225 | |
HEALTHCARE DISTRIBUTORS—2.6% | | | | | | | | |
AmerisourceBergen Corp., Cl. A | | | 208,061 | | | | 30,362,342 | |
McKesson Corp. | | | 235,456 | | | | 80,427,060 | |
| | | | | | | 110,789,402 | |
HEALTHCARE EQUIPMENT—2.1% | | | | | | | | |
Edwards Lifesciences Corp.* | | | 324,664 | | | | 32,641,718 | |
Insulet Corp.* | | | 56,916 | | | | 14,103,785 | |
Intuitive Surgical, Inc.* | | | 190,574 | | | | 43,864,418 | |
| | | | | | | 90,609,921 | |
HEALTHCARE FACILITIES—0.7% | | | | | | | | |
Acadia Healthcare Co., Inc.* | | | 377,151 | | | | 31,269,589 | |
HEALTHCARE TECHNOLOGY—0.8% | | | | | | | | |
Veeva Systems, Inc., Cl. A* | | | 144,301 | | | | 32,262,818 | |
HOTELS RESORTS & CRUISE LINES—0.7% | | | | | | | | |
Airbnb, Inc., Cl. A* | | | 264,305 | | | | 29,332,569 | |
HYPERMARKETS & SUPER CENTERS—2.0% | | | | | | | | |
Costco Wholesale Corp. + | | | 154,953 | | | | 83,876,059 | |
INTERACTIVE HOME ENTERTAINMENT—0.9% | | | | | | | | |
Take-Two Interactive Software, Inc.* | | | 279,219 | | | | 37,060,738 | |
INTERACTIVE MEDIA & SERVICES—5.5% | | | | | | | | |
Alphabet, Inc., Cl. C*,+ | | | 1,744,323 | | | | 203,457,835 | |
Tencent Holdings Ltd. | | | 729,627 | | | | 28,199,036 | |
| | | | | | | 231,656,871 | |
INTERNET & DIRECT MARKETING RETAIL—9.6% | | | | | | | | |
Alibaba Group Holding Ltd.#,*,+ | | | 405,740 | | | | 36,260,984 | |
Altaba, Inc.*,(a) | | | 606,454 | | | | 1,043,101 | |
Amazon.com, Inc.*,+ | | | 2,286,772 | | | | 308,599,881 | |
MercadoLibre, Inc.* | | | 75,160 | | | | 61,158,444 | |
| | | | | | | 407,062,410 | |
LIFE SCIENCES TOOLS & SERVICES—1.5% | | | | | | | | |
Bio-Techne Corp. | | | 165,985 | | | | 63,950,701 | |
MANAGED HEALTHCARE—2.6% | | | | | | | | |
Centene Corp.* | | | 648,134 | | | | 60,257,018 | |
UnitedHealth Group, Inc. | | | 95,378 | | | | 51,727,305 | |
| | | | | | | 111,984,323 | |
MOVIES & ENTERTAINMENT—2.7% | | | | | | | | |
Live Nation Entertainment, Inc.*,+ | | | 985,608 | | | | 92,637,296 | |
Netflix, Inc.* | | | 95,696 | | | | 21,522,030 | |
| | | | | | | 114,159,326 | |
OIL & GAS EQUIPMENT & SERVICES—2.4% | | | | | | | | |
Baker Hughes Co., Cl. A+ | | | 2,847,820 | | | | 73,160,496 | |
Schlumberger NV+ | | | 731,615 | | | | 27,091,703 | |
| | | | | | | 100,252,199 | |
THE ALGER FUNDS II | ALGER SPECTRA FUND
Schedule of Investments July 31, 2022 (Unaudited) (Continued)
| | | | | | |
COMMON STOCKS—110.1% (CONT.) | | SHARES | | | VALUE | |
OIL & GAS EXPLORATION & PRODUCTION—3.6% | | | | | | | | |
Coterra Energy, Inc. | | | 1,144,726 | | | $ | 35,017,168 | |
Diamondback Energy, Inc. | | | 139,880 | | | | 17,907,438 | |
EOG Resources, Inc. | | | 295,214 | | | | 32,833,701 | |
Pioneer Natural Resources Co.+ | | | 277,467 | | | | 65,745,806 | |
| | | | | | | 151,504,113 | |
OIL & GAS STORAGE & TRANSPORTATION—0.5% | | | | | | | | |
Cheniere Energy, Inc. | | | 155,774 | | | | 23,300,675 | |
PHARMACEUTICALS—4.3% | | | | | | | | |
AstraZeneca PLC# | | | 875,217 | | | | 57,965,622 | |
Bayer AG | | | 455,129 | | | | 26,541,295 | |
Catalent, Inc.* | | | 451,814 | | | | 51,100,163 | |
Eli Lilly & Co. | | | 57,915 | | | | 19,093,996 | |
Jazz Pharmaceuticals PLC* | | | 191,375 | | | | 29,865,983 | |
| | | | | | | 184,567,059 | |
REAL ESTATE SERVICES—1.0% | | | | | | | | |
FirstService Corp. | | | 311,957 | | | | 41,752,325 | |
REGIONAL BANKS—0.9% | | | | | | | | |
SVB Financial Group* | | | 96,668 | | | | 39,010,371 | |
RESTAURANTS—3.6% | | | | | | | | |
Shake Shack, Inc., Cl. A*,(b) | | | 2,147,120 | | | | 110,490,795 | |
The Cheesecake Factory, Inc. | | | 1,469,701 | | | | 42,959,360 | |
| | | | | | | 153,450,155 | |
SEMICONDUCTOR EQUIPMENT—3.3% | | | | | | | | |
Applied Materials, Inc.+ | | | 479,628 | | | | 50,830,975 | |
SolarEdge Technologies, Inc.*,+ | | | 251,920 | | | | 90,723,950 | |
| | | | | | | 141,554,925 | |
SEMICONDUCTORS—3.8% | | | | | | | | |
Advanced Micro Devices, Inc.*,+ | | | 1,238,931 | | | | 117,041,812 | |
NVIDIA Corp.+ | | | 119,670 | | | | 21,735,662 | |
NXP Semiconductors NV | | | 113,723 | | | | 20,911,385 | |
| | | | | | | 159,688,859 | |
SPECIALTY CHEMICALS—1.7% | | | | | | | | |
Albemarle Corp. | | | 290,794 | | | | 71,043,882 | |
SYSTEMS SOFTWARE—12.4% | | | | | | | | |
Crowdstrike Holdings, Inc., Cl. A* | | | 219,244 | | | | 40,253,198 | |
Microsoft Corp.+ | | | 1,528,666 | | | | 429,157,693 | |
Palo Alto Networks, Inc.* | | | 38,021 | | | | 18,976,281 | |
ServiceNow, Inc.* | | | 88,509 | | | | 39,533,430 | |
| | | | | | | 527,920,602 | |
TECHNOLOGY HARDWARE STORAGE & PERIPHERALS—5.4% | | | | | | | | |
Apple, Inc.+ | | | 1,412,172 | | | | 229,492,072 | |
TRUCKING—0.8% | | | | | | | | |
Old Dominion Freight Line, Inc. | | | 114,004 | | | | 34,601,354 | |
TOTAL COMMON STOCKS | | | | | | | 4,677,871,288 | |
(Cost $4,085,726,132) | | | | | | | | |
PREFERRED STOCKS—0.2% | | SHARES | | | VALUE | |
BIOTECHNOLOGY—0.0% | | | | | | | | |
Prosetta Biosciences, Inc., Series D*,@,(a),(b) | | | 2,912,012 | | | | — | |
THE ALGER FUNDS II | ALGER SPECTRA FUND
Schedule of Investments July 31, 2022 (Unaudited) (Continued)
| | | | | | |
PREFERRED STOCKS—0.2% (CONT.) | | SHARES | | | VALUE | |
DATA PROCESSING & OUTSOURCED SERVICES—0.2% | | | | | | | | |
Chime Financial, Inc., Series G*,@,(a) | | | 188,583 | | | $ | 9,310,343 | |
TOTAL PREFERRED STOCKS | | | | | | | | |
(Cost $26,129,444) | | | | | | | 9,310,343 | |
REAL ESTATE INVESTMENT TRUST—0.8% | | SHARES | | | VALUE | |
SPECIALIZED—0.8% | | | | | | | | |
Crown Castle International Corp. | | | 177,375 | | | | 32,044,567 | |
(Cost $31,219,441) | | | | | | | 32,044,567 | |
SPECIAL PURPOSE VEHICLE—0.3% | | SHARES | | | VALUE | |
DATA PROCESSING & OUTSOURCED SERVICES—0.3% | | | | | | | | |
Crosslink Ventures Capital LLC, Cl. A*,@,(a),(b) | | | 294 | | | | 8,671,530 | |
Crosslink Ventures Capital LLC, Cl. B*,@,(a),(b) | | | 183 | | | | 5,515,986 | |
| | | | | | | 14,187,516 | |
TOTAL SPECIAL PURPOSE VEHICLE | | | | | | | | |
(Cost $11,925,000) | | | | | | | 14,187,516 | |
Total Investments | | | | | | | | |
(Cost $4,155,000,017) | | | 111.4 | % | | $ | 4,733,413,714 | |
Affiliated Securities (Cost $143,175,907) | | | | | | | 124,678,311 | |
Unaffiliated Securities (Cost $4,011,824,110) | | | | | | | 4,608,735,403 | |
Securities Sold Short (Proceeds $450,320,243) | | | (9.5 | )% | | | (404,509,588 | ) |
Liabilities in Excess of Other Assets | | | (1.9 | )% | | | (81,183,907 | ) |
NET ASSETS | | | 100.0 | % | | $ | 4,247,720,219 | |
| + | All or a portion of this security is held as collateral for securities sold short. |
| # | American Depositary Receipts. |
| (a) | Security is valued in good faith at fair value determined using significant unobservable inputs pursuant to procedures established by the Board. |
| (b) | Deemed an affiliate of the Fund in accordance with Section 2(a)(3) of the Investment Company Act of 1940. See Note 5 - Affiliated Securities. |
| * | Non-income producing security. |
| @ | Restricted security - Investment in security not registered under the Securities Act of 1933. Sales or transfers of the investment may be restricted only to qualified buyers. |
Security | | Acquisition Date(s) | | Acquisition Cost | | | % of net assets (Acquisition Date) | | | Market Value | | | % of net assets as of 7/31/2022 | |
Chime Financial, Inc., Series G | | 8/24/21 | | $ | 13,025,390 | | | | 0.15 | % | | $ | 9,310,343 | | | | 0.22 | % |
Crosslink Ventures Capital LLC, Cl. A | | 10/2/20 | | | 7,350,000 | | | | 0.10 | % | | | 8,671,530 | | | | 0.20 | % |
Crosslink Ventures Capital LLC, Cl. B | | 12/16/20 | | | 4,575,000 | | | | 0.06 | % | | | 5,515,986 | | | | 0.13 | % |
Prosetta Biosciences, Inc., Series D | | 2/6/15 | | | 13,104,054 | | | | 0.28 | % | | | 0 | | | | 0.00 | % |
Total | | | | | | | | | | | | $ | 23,497,859 | | | | 0.55 | % |
See Notes to Financial Statements.
THE ALGER FUNDS II | ALGER SPECTRA FUND
Schedule of Investments - Securities Sold Short July 31, 2022 (Unaudited)
| | | | | | |
COMMON STOCKS—(9.5)% | | SHARES | | | VALUE | |
APPLICATION SOFTWARE—(0.2)% | | | | | | | | |
Elastic NV | | | (90,813 | ) | | $ | (7,255,051 | ) |
AUTO PARTS & EQUIPMENT—(0.3)% | | | | | | | | |
QuantumScape Corp., Cl. A | | | (1,369,662 | ) | | | (14,819,743 | ) |
AUTOMOBILE MANUFACTURERS—(0.3)% | | | | | | | | |
Lucid Group, Inc. | | | (466,217 | ) | | | (8,508,460 | ) |
Thor Industries, Inc. | | | (75,267 | ) | | | (6,347,266 | ) |
| | | | | | | (14,855,726 | ) |
BIOTECHNOLOGY—(0.2)% | | | | | | | | |
Regeneron Pharmaceuticals, Inc. | | | (17,361 | ) | | | (10,098,720 | ) |
CABLE & SATELLITE—(0.2)% | | | | | | | | |
Charter Communications, Inc., Cl. A | | | (21,635 | ) | | | (9,348,483 | ) |
EXCHANGE TRADED FUNDS—(1.1)% | | | | | | | | |
Direxion NASDAQ-100 Equal Weighted Index Shares | | | (682,471 | ) | | | (47,547,755 | ) |
GENERAL MERCHANDISE STORES—(0.8)% | | | | | | | | |
Target Corp. | | | (198,309 | ) | | | (32,399,724 | ) |
HOME FURNISHINGS—(0.1)% | | | | | | | | |
Tempur Sealy International, Inc. | | | (159,972 | ) | | | (4,396,031 | ) |
HOME IMPROVEMENT RETAIL—(0.3)% | | | | | | | | |
Floor & Decor Holdings, Inc., Cl. A | | | (163,422 | ) | | | (13,166,911 | ) |
HOUSEHOLD PRODUCTS—(0.5)% | | | | | | | | |
The Clorox Co. | | | (144,541 | ) | | | (20,501,695 | ) |
INTERNET & DIRECT MARKETING RETAIL—(0.3)% | | | | | | | | |
Wayfair, Inc., Cl. A | | | (214,196 | ) | | | (11,547,306 | ) |
LIFE SCIENCES TOOLS & SERVICES—(0.4)% | | | | | | | | |
Charles River Laboratories International, Inc. | | | (60,431 | ) | | | (15,140,383 | ) |
MARKET INDICES—(3.1)% | | | | | | | | |
iShares Russell Mid-Cap Growth ETF | | | (481,069 | ) | | | (42,771,845 | ) |
SPDR S&P 500 ETF Trust | | | (218,908 | ) | | | (90,187,907 | ) |
| | | | | | | (132,959,752 | ) |
OTHER DIVERSIFIED FINANCIAL SERVICES—(0.7)% | | | | | | | | |
iShares 20+ Year Treasury Bond ETF | | | (246,057 | ) | | | (28,894,474 | ) |
SYSTEMS SOFTWARE—(0.4)% | | | | | | | | |
Monday.com Ltd. | | | (47,448 | ) | | | (4,874,333 | ) |
Zscaler, Inc. | | | (96,266 | ) | | | (14,927,006 | ) |
| | | | | | | (19,801,339 | ) |
TECHNOLOGY HARDWARE STORAGE & PERIPHERALS—(0.6)% | | | | | | | | |
HP, Inc. | | | (456,101 | ) | | | (15,229,212 | ) |
Logitech International SA# | | | (115,452 | ) | | | (6,547,283 | ) |
| | | | | | | (21,776,495 | ) |
TOTAL COMMON STOCKS | | | | | | | | |
(Proceeds $450,320,243) | | | | | | $ | (404,509,588 | ) |
THE ALGER FUNDS II | ALGER SPECTRA FUND
Schedule of Investments - Securities Sold Short July 31, 2022 (Unaudited) (Continued)
| | | | | | |
| | | | | VALUE | |
Total Securities Sold Short | | | | | | | | |
(Proceeds $450,320,243) | | | | | | $ | (404,509,588 | ) |
| # | American Depositary Receipts. |
See Notes to Financial Statements.
THE ALGER FUNDS II | ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments July 31, 2022 (Unaudited)
| | | | | | |
COMMON STOCKS—80.6% | | SHARES | | | VALUE | |
AEROSPACE & DEFENSE—5.7% | | | | | | | | |
HEICO Corp.+ | | | 48,412 | | | $ | 7,635,057 | |
HEICO Corp., Cl. A+ | | | 40,387 | | | | 5,156,612 | |
Kratos Defense & Security Solutions, Inc.*,+ | | | 79,623 | | | | 1,145,775 | |
TransDigm Group, Inc.*,+ | | | 22,686 | | | | 14,118,405 | |
Triumph Group, Inc.* | | | 159,587 | | | | 2,479,982 | |
| | | | | | | 30,535,831 | |
APPAREL RETAIL—0.7% | | | | | | | | |
Aritzia, Inc.* | | | 43,010 | | | | 1,356,814 | |
MYT Netherlands Parent BV#,* | | | 179,850 | | | | 2,372,222 | |
| | | | | | | 3,729,036 | |
APPLICATION SOFTWARE—10.1% | | | | | | | | |
Altair Engineering, Inc., Cl. A* | | | 2,802 | | | | 165,066 | |
Avalara, Inc.* | | | 36,489 | | | | 3,189,868 | |
Bill.com Holdings, Inc.* | | | 4,834 | | | | 652,977 | |
Cerence, Inc.* | | | 13,278 | | | | 374,041 | |
Datadog, Inc., Cl. A* | | | 75,548 | | | | 7,706,651 | |
Ebix, Inc.+ | | | 80,154 | | | | 1,896,444 | |
Everbridge, Inc.* | | | 2,061 | | | | 51,813 | |
HubSpot, Inc.* | | | 11,067 | | | | 3,408,636 | |
Intuit, Inc.+ | | | 5,898 | | | | 2,690,491 | |
Paylocity Holding Corp.*,+ | | | 75,483 | | | | 15,544,214 | |
Procore Technologies, Inc.* | | | 61,173 | | | | 3,162,644 | |
SEMrush Holdings, Inc., Cl. A* | | | 28,850 | | | | 350,816 | |
Splunk, Inc.* | | | 10,513 | | | | 1,092,406 | |
Sprinklr, Inc., Cl. A* | | | 162,250 | | | | 1,839,915 | |
Sprout Social, Inc., Cl. A*,+ | | | 23,150 | | | | 1,206,115 | |
SPS Commerce, Inc.*,+ | | | 52,096 | | | | 6,239,017 | |
The Trade Desk, Inc., Cl. A*,+ | | | 6,625 | | | | 298,125 | |
Vertex, Inc., Cl. A*,+ | | | 349,891 | | | | 3,936,274 | |
| | | | | | | 53,805,513 | |
ASSET MANAGEMENT & CUSTODY BANKS—1.9% | | | | | | | | |
Hamilton Lane, Inc., Cl. A+ | | | 65,623 | | | | 4,959,130 | |
StepStone Group, Inc., Cl. A+ | | | 200,738 | | | | 5,347,660 | |
| | | | | | | 10,306,790 | |
AUTOMOBILE MANUFACTURERS—1.1% | | | | | | | | |
Tesla, Inc.*,+ | | | 6,517 | | | | 5,809,580 | |
THE ALGER FUNDS II | ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments July 31, 2022 (Unaudited) (Continued)
| | | | | | |
COMMON STOCKS—80.6% (CONT.) | | SHARES | | | VALUE | |
BIOTECHNOLOGY—5.4% | | | | | | | | |
AbbVie, Inc. | | | 8,001 | | | $ | 1,148,223 | |
ACADIA Pharmaceuticals, Inc.*,+ | | | 190,336 | | | | 2,796,036 | |
ADMA Biologics, Inc.* | | | 840,368 | | | | 1,798,387 | |
Alkermes PLC* | | | 79,319 | | | | 2,030,566 | |
Apellis Pharmaceuticals, Inc.* | | | 29,902 | | | | 1,682,885 | |
BioMarin Pharmaceutical, Inc.* | | | 32,959 | | | | 2,836,122 | |
BioNTech SE#,+ | | | 9,778 | | | | 1,614,837 | |
Celldex Therapeutics, Inc.* | | | 40,092 | | | | 1,231,626 | |
Natera, Inc.*,+ | | | 154,094 | | | | 7,242,418 | |
Seagen, Inc.* | | | 13,602 | | | | 2,448,088 | |
Ultragenyx Pharmaceutical, Inc.* | | | 22,113 | | | | 1,178,181 | |
United Therapeutics Corp.* | | | 4,871 | | | | 1,125,542 | |
Vertex Pharmaceuticals, Inc.* | | | 6,260 | | | | 1,755,367 | |
| | | | | | | 28,888,278 | |
CASINOS & GAMING—0.9% | | | | | | | | |
MGM Resorts International+ | | | 151,925 | | | | 4,972,505 | |
CONSTRUCTION & ENGINEERING—0.5% | | | | | | | | |
Ameresco, Inc., Cl. A*,+ | | | 46,127 | | | | 2,639,387 | |
CONSUMER FINANCE—1.3% | | | | | | | | |
American Express Co. | | | 31,382 | | | | 4,833,456 | |
LendingTree, Inc.* | | | 5,118 | | | | 233,278 | |
Upstart Holdings, Inc.*,+ | | | 74,659 | | | | 1,816,454 | |
| | | | | | | 6,883,188 | |
DATA PROCESSING & OUTSOURCED SERVICES—0.2% | | | | | | | | |
Marqeta, Inc., Cl. A* | | | 126,412 | | | | 1,212,291 | |
DIVERSIFIED BANKS—0.4% | | | | | | | | |
JPMorgan Chase & Co. | | | 20,823 | | | | 2,402,141 | |
DIVERSIFIED METALS & MINING—0.5% | | | | | | | | |
MP Materials Corp.*,+ | | | 86,035 | | | | 2,888,195 | |
DIVERSIFIED SUPPORT SERVICES—0.7% | | | | | | | | |
UniFirst Corp. | | | 18,620 | | | | 3,647,472 | |
EDUCATION SERVICES—1.1% | | | | | | | | |
Chegg, Inc.*,+ | | | 288,014 | | | | 6,134,698 | |
Duolingo, Inc., Cl. A* | | | 179 | | | | 16,423 | |
| | | | | | | 6,151,121 | |
ELECTRICAL COMPONENTS & EQUIPMENT—1.3% | | | | | | | | |
Generac Holdings, Inc.*,+ | | | 26,114 | | | | 7,006,386 | |
ELECTRONIC EQUIPMENT & INSTRUMENTS—0.9% | | | | | | | | |
908 Devices, Inc.* | | | 189,561 | | | | 4,265,123 | |
Novanta, Inc.* | | | 4,767 | | | | 735,071 | |
| | | | | | | 5,000,194 | |
ENVIRONMENTAL & FACILITIES SERVICES—4.4% | | | | | | | | |
Casella Waste Systems, Inc., Cl. A*,+ | | | 50,043 | | | | 4,050,981 | |
Montrose Environmental Group, Inc.*,+ | | | 263,034 | | | | 10,552,924 | |
Waste Connections, Inc.+ | | | 66,963 | | | | 8,930,855 | |
| | | | | | | 23,534,760 | |
GENERAL MERCHANDISE STORES—0.2% | | | | | | | | |
Ollie’s Bargain Outlet Holdings, Inc.*,+ | | | 21,212 | | | | 1,250,447 | |
THE ALGER FUNDS II | ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments July 31, 2022 (Unaudited) (Continued)
| | | | | | |
COMMON STOCKS—80.6% (CONT.) | | SHARES | | | VALUE | |
HEALTHCARE DISTRIBUTORS—0.1% | | | | | | | | |
PetIQ, Inc., Cl. A* | | | 16,984 | | | $ | 278,538 | |
HEALTHCARE EQUIPMENT—4.6% | | | | | | | | |
Edwards Lifesciences Corp.*,+ | | | 12,181 | | | | 1,224,678 | |
Glaukos Corp.*,+ | | | 129,641 | | | | 6,981,168 | |
Impulse Dynamics NV, Series E*,@,(a) | | | 1,056,141 | | | | 3,485,265 | |
Inogen, Inc.* | | | 88,370 | | | | 2,458,453 | |
Insulet Corp.*,+ | | | 11,403 | | | | 2,825,663 | |
Intuitive Surgical, Inc.* | | | 6,750 | | | | 1,553,648 | |
Nevro Corp.*,+ | | | 77,510 | | | | 3,360,059 | |
TransMedics Group, Inc.* | | | 60,476 | | | | 2,442,021 | |
| | | | | | | 24,330,955 | |
HEALTHCARE FACILITIES—0.3% | | | | | | | | |
Acadia Healthcare Co., Inc.* | | | 22,598 | | | | 1,873,600 | |
HEALTHCARE SERVICES—1.1% | | | | | | | | |
Accolade, Inc.* | | | 183,626 | | | | 1,696,704 | |
Agiliti, Inc.* | | | 188,294 | | | | 4,121,756 | |
| | | | | | | 5,818,460 | |
HEALTHCARE TECHNOLOGY—0.8% | | | | | | | | |
Definitive Healthcare Corp., Cl. A* | | | 361 | | | | 9,379 | |
Inspire Medical Systems, Inc.* | | | 6,342 | | | | 1,325,414 | |
Phreesia, Inc.* | | | 74,655 | | | | 1,753,646 | |
Veeva Systems, Inc., Cl. A*,+ | | | 5,581 | | | | 1,247,800 | |
| | | | | | | 4,336,239 | |
INSURANCE BROKERS—0.1% | | | | | | | | |
Goosehead Insurance, Inc., Cl. A | | | 7,809 | | | | 438,944 | |
INTERACTIVE HOME ENTERTAINMENT—0.2% | | | | | | | | |
Take-Two Interactive Software, Inc.* | | | 9,467 | | | | 1,256,555 | |
INTERACTIVE MEDIA & SERVICES—0.8% | | | | | | | | |
Tencent Holdings Ltd. | | | 105,006 | | | | 4,058,331 | |
INTERNET & DIRECT MARKETING RETAIL—3.0% | | | | | | | | |
Amazon.com, Inc.* | | | 80,149 | | | | 10,816,107 | |
MercadoLibre, Inc.* | | | 4,536 | | | | 3,690,989 | |
The RealReal, Inc.* | | | 616,205 | | | | 1,435,758 | |
| | | | | | | 15,942,854 | |
INTERNET SERVICES & INFRASTRUCTURE—1.0% | | | | | | | | |
BigCommerce Holdings, Inc.* | | | 5,197 | | | | 81,333 | |
MongoDB, Inc., Cl. A* | | | 16,402 | | | | 5,125,133 | |
| | | | | | | 5,206,466 | |
IT CONSULTING & OTHER SERVICES—0.5% | | | | | | | | |
CI&T, Inc., Cl. A* | | | 87,546 | | | | 991,021 | |
Globant SA* | | | 8,851 | | | | 1,763,473 | |
| | | | | | | 2,754,494 | |
LEISURE FACILITIES—0.2% | | | | | | | | |
Planet Fitness, Inc., Cl. A* | | | 14,494 | | | | 1,142,272 | |
THE ALGER FUNDS II | ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments July 31, 2022 (Unaudited) (Continued)
| | | | | | |
COMMON STOCKS—80.6% (CONT.) | | SHARES | | | VALUE | |
LIFE SCIENCES TOOLS & SERVICES—1.4% | | | | | | | | |
NeoGenomics, Inc.*,+ | | | 10,313 | | | $ | 104,367 | |
Repligen Corp.* | | | 11,366 | | | | 2,425,050 | |
Thermo Fisher Scientific, Inc. | | | 4,258 | | | | 2,548,030 | |
Waters Corp.* | | | 6,595 | | | | 2,400,778 | |
| | | | | | | 7,478,225 | |
MANAGED HEALTHCARE—0.8% | | | | | | | | |
Centene Corp.* | | | 44,139 | | | | 4,103,603 | |
Progyny, Inc.* | | | 10,547 | | | | 322,000 | |
| | | | | | | 4,425,603 | |
MOVIES & ENTERTAINMENT—1.4% | | | | | | | | |
Live Nation Entertainment, Inc.*,+ | | | 77,325 | | | | 7,267,777 | |
OIL & GAS EQUIPMENT & SERVICES—2.9% | | | | | | | | |
Baker Hughes Co., Cl. A+ | | | 97,185 | | | | 2,496,683 | |
Core Laboratories NV+ | | | 333,207 | | | | 6,310,940 | |
Dril-Quip, Inc.* | | | 169,791 | | | | 4,355,139 | |
Schlumberger NV+ | | | 66,238 | | | | 2,452,793 | |
| | | | | | | 15,615,555 | |
OIL & GAS EXPLORATION & PRODUCTION—4.0% | | | | | | | | |
Coterra Energy, Inc.+ | | | 218,577 | | | | 6,686,271 | |
EOG Resources, Inc.+ | | | 66,123 | | | | 7,354,200 | |
Pioneer Natural Resources Co.+ | | | 30,893 | | | | 7,320,096 | |
| | | | | | | 21,360,567 | |
PHARMACEUTICALS—0.9% | | | | | | | | |
Aerie Pharmaceuticals, Inc.* | | | 147,529 | | | | 1,034,178 | |
Bayer AG | | | 20,577 | | | | 1,199,968 | |
Catalent, Inc.* | | | 21,212 | | | | 2,399,077 | |
| | | | | | | 4,633,223 | |
REAL ESTATE SERVICES—2.5% | | | | | | | | |
FirstService Corp.+ | | | 98,938 | | | | 13,241,862 | |
REGIONAL BANKS—2.9% | | | | | | | | |
Seacoast Banking Corp. of Florida | | | 51,107 | | | | 1,828,609 | |
Signature Bank+ | | | 64,016 | | | | 11,879,449 | |
SVB Financial Group* | | | 4,293 | | | | 1,732,440 | |
| | | | | | | 15,440,498 | |
RESTAURANTS—1.9% | | | | | | | | |
Shake Shack, Inc., Cl. A* | | | 72,794 | | | | 3,745,979 | |
The Cheesecake Factory, Inc.+ | | | 166,721 | | | | 4,873,255 | |
Wingstop, Inc. | | | 10,306 | | | | 1,300,411 | |
| | | | | | | 9,919,645 | |
SEMICONDUCTOR EQUIPMENT—1.8% | | | | | | | | |
Applied Materials, Inc.+ | | | 39,222 | | | | 4,156,748 | |
SolarEdge Technologies, Inc.*,+ | | | 14,595 | | | | 5,256,097 | |
| | | | | | | 9,412,845 | |
THE ALGER FUNDS II | ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments July 31, 2022 (Unaudited) (Continued)
| | | | | | |
COMMON STOCKS—80.6% (CONT.) | | SHARES | | | VALUE | |
SEMICONDUCTORS—3.3% | | | | | | | | |
Advanced Micro Devices, Inc.*,+ | | | 72,988 | | | $ | 6,895,176 | |
Impinj, Inc.* | | | 59,845 | | | | 5,088,022 | |
NXP Semiconductors NV | | | 13,144 | | | | 2,416,919 | |
SiTime Corp.* | | | 16,701 | | | | 3,106,052 | |
| | | | | | | 17,506,169 | |
SPECIALTY CHEMICALS—1.2% | | | | | | | | |
Albemarle Corp. | | | 25,278 | | | | 6,175,668 | |
SYSTEMS SOFTWARE—3.9% | | | | | | | | |
Crowdstrike Holdings, Inc., Cl. A* | | | 12,213 | | | | 2,242,307 | |
Microsoft Corp.+ | | | 51,971 | | | | 14,590,338 | |
Rapid7, Inc.* | | | 2,415 | | | | 154,488 | |
ServiceNow, Inc.* | | | 8,306 | | | | 3,709,958 | |
| | | | | | | 20,697,091 | |
TECHNOLOGY HARDWARE STORAGE & PERIPHERALS—0.9% | | | | | | | | |
Apple, Inc. | | | 30,134 | | | | 4,897,076 | |
THRIFTS & MORTGAGE FINANCE—0.1% | | | | | | | | |
Axos Financial, Inc.*,+ | | | 18,210 | | | | 760,450 | |
TRADING COMPANIES & DISTRIBUTORS—0.3% | | | | | | | | |
SiteOne Landscape Supply, Inc.*,+ | | | 10,295 | | | | 1,434,402 | |
TRUCKING—0.4% | | | | | | | | |
Old Dominion Freight Line, Inc. | | | 1,747 | | | | 530,232 | |
XPO Logistics, Inc.* | | | 28,763 | | | | 1,718,302 | |
| | | | | | | 2,248,534 | |
TOTAL COMMON STOCKS | | | | | | | | |
(Cost $443,637,219) | | | | | | | 430,616,013 | |
PREFERRED STOCKS—0.0% | | SHARES | | | VALUE |
BIOTECHNOLOGY—0.0% | | | | | | | | |
Prosetta Biosciences, Inc., Series D*,@,(a),(b) | | | 41,418 | | | | — | |
(Cost $186,381) | | | | | | | — | |
RIGHTS—0.0% | | SHARES | | | VALUE |
BIOTECHNOLOGY—0.0% | | | | | | | | |
Tolero CDR*,@,(a),(c) | | | 126,108 | | | | 74,404 | |
(Cost $67,638) | | | | | | | 74,404 | |
REAL ESTATE INVESTMENT TRUST—0.5% | | SHARES | | | VALUE |
INDUSTRIAL—0.5% | | | | | | | | |
Prologis, Inc. | | | 18,588 | | | | 2,464,025 | |
(Cost $2,266,858) | | | | | | | 2,464,025 | |
SPECIAL PURPOSE VEHICLE—0.3% | | SHARES | | | VALUE |
DATA PROCESSING & OUTSOURCED SERVICES—0.3% | | | | | | | | |
Crosslink Ventures Capital LLC, Cl. A*,@,(a),(b) | | | 37 | | | | 1,091,315 | |
Crosslink Ventures Capital LLC, Cl. B*,@,(a),(b) | | | 22 | | | | 663,124 | |
| | | | | | | 1,754,439 | |
TOTAL SPECIAL PURPOSE VEHICLE | | | | | | | | |
(Cost $1,475,000) | | | | | | | 1,754,439 | |
THE ALGER FUNDS II | ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments July 31, 2022 (Unaudited) (Continued)
| | | | | | | | | | | |
PURCHASED OPTIONS—0.0% SECURITY NAME/ EXPIRATION DATE/ STRIKE PRICE | | NOTIONAL AMOUNTS | | | COUNTERPARTY | | NUMBER OF CONTRACTS | | | VALUE | |
PUT OPTIONS—0.0% | | | | | | | | | | | | | | |
Twist Bioscience Corp., 10/21/22, $30.00 | | $ | 1,968,300 | | | BNP Paribas | | | 450 | | | $ | 94,500 | |
Twist Bioscience Corp., 8/19/22, $35.00 | | $ | 1,968,300 | | | BNP Paribas | | | 450 | | | | 58,500 | |
(Cost $276,488) | | | | | | | | | | | | | 153,000 | |
TOTAL PURCHASED OPTIONS | | | | | | | | | | | | | | |
(Cost $276,488) | | | | | | | | | | | | | 153,000 | |
Total Investments | | | | | | | | | | | | | | |
(Cost $447,909,584) | | | | | | | | | 81.4 | % | | $ | 435,061,881 | |
Affiliated Securities (Cost $1,661,381) | | | | | | | 1,754,439 | |
Unaffiliated Securities (Cost $446,248,203) | | | | | | | 433,307,442 | |
Securities Sold Short (Proceeds $289,609,471) | | | (43.8 | )% | | | (234,044,246 | ) |
Swaps | | | 0.0 | % | | | 106,649 | |
Other Assets in Excess of Liabilities | | | 62.4 | % | | | 333,359,655 | |
NET ASSETS | | | | | | | | | 100.0 | % | | $ | 534,483,939 | |
| + | All or a portion of this security is held as collateral for securities sold short. |
| # | American Depositary Receipts. |
| (a) | Security is valued in good faith at fair value determined using significant unobservable inputs pursuant to procedures established by the Board. |
| (b) | Deemed an affiliate of the Fund in accordance with Section 2(a)(3) of the Investment Company Act of 1940. See Note 5 - Affiliated Securities. |
| (c) | Contingent Deferred Rights. |
| * | Non-income producing security. |
| @ | Restricted security - Investment in security not registered under the Securities Act of 1933. Sales or transfers of the investment may be restricted only to qualified buyers. |
Security | | Acquisition Date(s) | | Acquisition Cost | | | % of net assets (Acquisition Date) | | | Market Value | | | % of net assets as of 7/31/2022 | |
Crosslink Ventures Capital LLC, Cl. A | | 10/2/20 | | $ | 925,000 | | | | 0.24 | % | | $ | 1,091,315 | | | | 0.21 | % |
Crosslink Ventures Capital LLC, Cl. B | | 12/16/20 | | | 550,000 | | | | 0.11 | % | | | 663,124 | | | | 0.12 | % |
Impulse Dynamics NV, Series E | | 2/11/22 | | | 3,485,265 | | | | 0.47 | % | | | 3,485,265 | | | | 0.65 | % |
Prosetta Biosciences, Inc., Series D | | 2/6/15 | | | 186,381 | | | | 0.25 | % | | | 0 | | | | 0.00 | % |
Tolero CDR | | 2/6/17 | | | 67,638 | | | | 0.09 | % | | | 74,404 | | | | 0.01 | % |
| | | | | | | | | | | | $ | 5,314,108 | | | | 0.99 | % |
Swaps outstanding as of July 31, 2022:
Centrally cleared swaps - Contracts for difference
| | | | | | | | | | | | | | | | | |
Contract Amount | | | Counterparty | | Reference Company | | Market Value | | | Unrealized Appreciation | | | Unrealized (Depreciation) | | | Net Unrealized Appreciation/ (Depreciation) | |
| (15,703 | )
| | Goldman Sachs | | The Clorox Co. | | $ | 106,649 | | | $ | 106,649 | | | $ | — | | | $ | 106,649 | |
Total | | | | | | | | 106,649 | | | $ | 106,649 | | | $ | — | | | $ | 106,649 | |
See Notes to Financial Statements.
THE ALGER FUNDS II | ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments - Securities Sold Short July 31, 2022 (Unaudited)
COMMON STOCKS—(42.8)% | | SHARES | | | VALUE | |
ADVERTISING—(0.4)% | | | | | | | | |
Cardlytics, Inc. | | | (135,433 | ) | | $ | (1,868,975 | ) |
AEROSPACE & DEFENSE—(0.8)% | | | | | | | | |
Archer Aviation, Inc., Cl. A | | | (1,094,206 | ) | | | (4,420,592 | ) |
AIRLINES—(1.7)% | | | | | | | | |
Blade Air Mobility, Inc. | | | (219,146 | ) | | | (1,217,356 | ) |
Joby Aviation, Inc. | | | (1,414,985 | ) | | | (7,839,017 | ) |
| | | | | | | (9,056,373 | ) |
APPAREL ACCESSORIES & LUXURY GOODS—0.0% | | | | | | | | |
Oxford Industries, Inc. | | | (2,674 | ) | | | (255,100 | ) |
APPAREL RETAIL—0.0% | | | | | | | | |
Boot Barn Holdings, Inc. | | | (3,469 | ) | | | (216,119 | ) |
APPLICATION SOFTWARE—(2.4)% | | | | | | | | |
Amplitude, Inc., Cl. A | | | (166,852 | ) | | | (2,466,073 | ) |
Elastic NV | | | (28,610 | ) | | | (2,285,653 | ) |
HashiCorp, Inc., Cl. A | | | (71,886 | ) | | | (2,605,149 | ) |
Latch, Inc. | | | (795,673 | ) | | | (954,808 | ) |
MicroStrategy, Inc., Cl. A | | | (4,893 | ) | | | (1,399,692 | ) |
Palantir Technologies, Inc., Cl. A | | | (231,575 | ) | | | (2,396,801 | ) |
| | | | | | | (12,108,176 | ) |
ASSET MANAGEMENT & CUSTODY BANKS—(0.1)% | | | | | | | | |
Main Street Capital Corp. | | | (5,909 | ) | | | (266,023 | ) |
AUTO PARTS & EQUIPMENT—(1.9)% | | | | | | | | |
LCI Industries | | | (12,705 | ) | | | (1,716,318 | ) |
Patrick Industries, Inc. | | | (23,654 | ) | | | (1,436,271 | ) |
QuantumScape Corp., Cl. A | | | (642,692 | ) | | | (6,953,927 | ) |
| | | | | | | (10,106,516 | ) |
AUTOMOBILE MANUFACTURERS—(0.9)% | | | | | | | | |
Fisker, Inc. | | | (361,653 | ) | | | (3,464,636 | ) |
Thor Industries, Inc. | | | (21,594 | ) | | | (1,821,022 | ) |
| | | | | | | (5,285,658 | ) |
AUTOMOTIVE RETAIL—(1.0)% | | | | | | | | |
Carvana Co., Cl. A | | | (182,425 | ) | | | (5,317,689 | ) |
BIOTECHNOLOGY—(2.6)% | | | | | | | | |
Exact Sciences Corp. | | | (25,229 | ) | | | (1,137,828 | ) |
Novavax, Inc. | | | (31,636 | ) | | | (1,724,478 | ) |
Regeneron Pharmaceuticals, Inc. | | | (3,059 | ) | | | (1,779,390 | ) |
Twist Bioscience Corp. | | | (214,826 | ) | | | (9,396,489 | ) |
| | | | | | | (14,038,185 | ) |
BROADCASTING—(0.2)% | | | | | | | | |
Paramount Global, Cl. B | | | (48,057 | ) | | | (1,136,548 | ) |
CABLE & SATELLITE—(0.7)% | | | | | | | | |
Charter Communications, Inc., Cl. A | | | (8,309 | ) | | | (3,590,319 | ) |
CASINOS & GAMING—(0.2)% | | | | | | | | |
Boyd Gaming Corp. | | | (21,546 | ) | | | (1,196,019 | ) |
THE ALGER FUNDS II | ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments - Securities Sold Short July 31, 2022 (Unaudited) (Continued)
COMMON STOCKS—(42.8)% (CONT.) | | SHARES | | | VALUE | |
COMMODITY CHEMICALS—(1.5)% | | | | | | | | |
PureCycle Technologies, Inc. | | | (1,069,177 | ) | | $ | (8,104,362 | ) |
COMPUTER & ELECTRONICS RETAIL—(0.4)% | | | | | | | | |
Best Buy Co., Inc. | | | (24,435 | ) | | | (1,881,251 | ) |
DATA PROCESSING & OUTSOURCED SERVICES—(0.5)% | | | | | | | | |
Affirm Holdings, Inc., Cl. A | | | (100,754 | ) | | | (2,704,237 | ) |
DEPARTMENT STORES—(0.2)% | | | | | | | | |
Nordstrom, Inc. | | | (42,488 | ) | | | (998,893 | ) |
DIVERSIFIED SUPPORT SERVICES—(0.4)% | | | | | | | | |
Healthcare Services Group, Inc. | | | (134,388 | ) | | | (1,927,124 | ) |
ELECTRICAL COMPONENTS & EQUIPMENT—(2.0)% | | | | | | | | |
FREYR Battery SA | | | (656,634 | ) | | | (6,553,207 | ) |
Shoals Technologies Group, Inc., Cl. A | | | (143,522 | ) | | | (3,391,425 | ) |
Vicor Corp. | | | (12,094 | ) | | | (882,378 | ) |
| | | | | | | (10,827,010 | ) |
ELECTRONIC EQUIPMENT & INSTRUMENTS—(1.8)% | | | | | | | | |
SmartRent, Inc., Cl. A | | | (1,685,592 | ) | | | (9,540,451 | ) |
EXCHANGE TRADED FUNDS—(6.1)% | | | | | | | | |
ARK Genomic Revolution ETF | | | (621,964 | ) | | | (22,770,102 | ) |
ARK Next Generation Internet ETF | | | (173,708 | ) | | | (9,463,612 | ) |
| | | | | | | (32,233,714 | ) |
FOOD RETAIL—(0.2)% | | | | | | | | |
Sprouts Farmers Market, Inc. | | | (43,052 | ) | | | (1,189,957 | ) |
GENERAL MERCHANDISE STORES—(0.5)% | | | | | | | | |
Target Corp. | | | (14,763 | ) | | | (2,411,979 | ) |
HEALTHCARE EQUIPMENT—(0.2)% | | | | | | | | |
IDEXX Laboratories, Inc. | | | (3,152 | ) | | | (1,258,215 | ) |
HEALTHCARE SERVICES—(0.5)% | | | | | | | | |
23andMe Holding Co., Cl. A | | | (880,730 | ) | | | (2,448,429 | ) |
HEALTHCARE TECHNOLOGY—(0.4)% | | | | | | | | |
American Well Corp., Cl. A | | | (384,922 | ) | | | (1,501,196 | ) |
Health Catalyst, Inc. | | | (28,847 | ) | | | (482,899 | ) |
| | | | | | | (1,984,095 | ) |
HOME FURNISHINGS—(0.6)% | | | | | | | | |
Tempur Sealy International, Inc. | | | (112,301 | ) | | | (3,086,032 | ) |
HOME IMPROVEMENT RETAIL—(0.3)% | | | | | | | | |
Floor & Decor Holdings, Inc., Cl. A | | | (16,698 | ) | | | (1,345,358 | ) |
HYPERMARKETS & SUPER CENTERS—(0.3)% | | | | | | | | |
Walmart, Inc. | | | (13,824 | ) | | | (1,825,459 | ) |
INDUSTRIAL MACHINERY—(0.9)% | | | | | | | | |
Desktop Metal, Inc. Cl. A | | | (1,327,444 | ) | | | (2,827,456 | ) |
Velo3D, Inc. | | | (697,666 | ) | | | (2,239,508 | ) |
| | | | | | | (5,066,964 | ) |
INTERACTIVE MEDIA & SERVICES—(0.5)% | | | | | | | | |
Twitter, Inc. | | | (60,372 | ) | | | (2,512,079 | ) |
THE ALGER FUNDS II | ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments - Securities Sold Short July 31, 2022 (Unaudited) (Continued)
COMMON STOCKS—(42.8)% (CONT.) | | SHARES | | | VALUE | |
INTERNET & DIRECT MARKETING RETAIL—(1.2)% | | | | | | | | |
DoorDash, Inc., Cl. A | | | (32,757 | ) | | $ | (2,284,801 | ) |
eBay, Inc. | | | (27,201 | ) | | | (1,322,785 | ) |
Porch Group, Inc. | | | (197,212 | ) | | | (380,619 | ) |
Poshmark, Inc., Cl. A | | | (82,697 | ) | | | (892,301 | ) |
Rent the Runway, Inc., Cl. A | | | (85,526 | ) | | | (379,735 | ) |
Vivid Seats, Inc., Cl. A | | | (30,464 | ) | | | (254,679 | ) |
Wayfair, Inc., Cl. A | | | (21,402 | ) | | | (1,153,782 | ) |
| | | | | | | (6,668,702 | ) |
INTERNET SERVICES & INFRASTRUCTURE—(1.3)% | | | | | | | | |
Cloudflare, Inc., Cl. A | | | (76,179 | ) | | | (3,833,327 | ) |
DigitalOcean Holdings, Inc. | | | (49,787 | ) | | | (2,040,271 | ) |
Snowflake, Inc., Cl. A | | | (8,846 | ) | | | (1,326,104 | ) |
| | | | | | | (7,199,702 | ) |
IT CONSULTING & OTHER SERVICES—(0.2)% | | | | | | | | |
Accenture PLC, Cl. A | | | (3,657 | ) | | | (1,119,993 | ) |
LIFE & HEALTH INSURANCE—(0.4)% | | | | | | | | |
Trupanion, Inc. | | | (35,512 | ) | | | (2,238,321 | ) |
LIFE SCIENCES TOOLS & SERVICES—(0.5)% | | | | | | | | |
Charles River Laboratories International, Inc. | | | (9,115 | ) | | | (2,283,672 | ) |
Lonza Group AG | | | (1,019 | ) | | | (619,136 | ) |
| | | | | | | (2,902,808 | ) |
MARKET INDICES—(2.1)% | | | | | | | | |
iShares Russell 2000 Growth ETF | | | (47,998 | ) | | | (11,020,821 | ) |
METAL & GLASS CONTAINERS—(0.2)% | | | | | | | | |
O-I Glass, Inc. | | | (86,144 | ) | | | (1,267,178 | ) |
PAPER PACKAGING—(0.6)% | | | | | | | | |
Ranpak Holdings Corp., Cl. A | | | (664,212 | ) | | | (3,394,123 | ) |
PROPERTY & CASUALTY INSURANCE—(0.4)% | | | | | | | | |
Lemonade, Inc. | | | (108,733 | ) | | | (2,049,617 | ) |
REAL ESTATE SERVICES—(1.4)% | | | | | | | | |
Offerpad Solutions, Inc. | | | (1,187,989 | ) | | | (2,506,657 | ) |
Opendoor Technologies, Inc. | | | (802,644 | ) | | | (3,940,982 | ) |
Zillow Group, Inc., Cl. A | | | (34,320 | ) | | | (1,201,200 | ) |
| | | | | | | (7,648,839 | ) |
REGIONAL BANKS—(1.1)% | | | | | | | | |
Silvergate Capital Corp., Cl. A | | | (63,900 | ) | | | (5,961,231 | ) |
RESTAURANTS—(0.3)% | | | | | | | | |
Portillo’s, Inc., Cl. A | | | (53,134 | ) | | | (1,213,049 | ) |
Sweetgreen, Inc., Cl. A | | | (41,123 | ) | | | (646,042 | ) |
| | | | | | | (1,859,091 | ) |
SPECIALTY CHEMICALS—(0.2)% | | | | | | | | |
PPG Industries, Inc. | | | (9,966 | ) | | | (1,288,504 | ) |
SPECIALTY STORES—(0.8)% | | | | | | | | |
Dick’s Sporting Goods, Inc. | | | (13,151 | ) | | | (1,230,802 | ) |
Five Below, Inc. | | | (15,358 | ) | | | (1,951,541 | ) |
THE ALGER FUNDS II | ALGER DYNAMIC OPPORTUNITIES FUND
Schedule of Investments - Securities Sold Short July 31, 2022 (Unaudited) (Continued)
COMMON STOCKS—(42.8)% (CONT.) | | SHARES | | | VALUE | |
SPECIALTY STORES—(0.8)% (CONT.) | | | | | | | | |
Tractor Supply Co. | | �� | (6,248 | ) | | $ | (1,196,367 | ) |
| | | | | | | (4,378,710 | ) |
SYSTEMS SOFTWARE—(1.2)% | | | | | | | | |
Monday.com Ltd. | | | (15,431 | ) | | | (1,585,227 | ) |
SentinelOne, Inc., Cl. A | | | (42,977 | ) | | | (1,067,978 | ) |
UiPath, Inc., Cl. A | | | (84,486 | ) | | | (1,548,628 | ) |
Zscaler, Inc. | | | (12,597 | ) | | | (1,953,291 | ) |
| | | | | | | (6,155,124 | ) |
TECHNOLOGY HARDWARE STORAGE & | | | | | | | | |
PERIPHERALS—(0.3)% | | | | | | | | |
HP, Inc. | | | (37,375 | ) | | | (1,247,951 | ) |
Logitech International SA | | | (11,169 | ) | | | (633,394 | ) |
| | | | | | | (1,881,345 | ) |
TRUCKING—(0.4)% | | | | | | | | |
Lyft, Inc., Cl. A | | | (138,662 | ) | | | (1,921,855 | ) |
TOTAL COMMON STOCKS | | | | | | | | |
(Proceeds $283,304,399) | | | | | | $ | (229,163,865 | ) |
REAL ESTATE INVESTMENT TRUST—(1.0)% | | SHARES | | | VALUE | |
DIVERSIFIED—(0.4)% | | | | | | | | |
Empire State Realty Trust, Inc., Cl. A | | | (236,497 | ) | | | (2,017,319 | ) |
HEALTHCARE—(0.2)% | | | | | | | | |
Omega Healthcare Investors, Inc. | | | (29,925 | ) | | | (927,675 | ) |
OFFICE—(0.1)% | | | | | | | | |
Paramount Group, Inc. | | | (40,832 | ) | | | (320,531 | ) |
REAL ESTATE OPERATING COMPANIES—(0.3)% | | | | | | | | |
Seritage Growth Properties, Cl. A | | | (133,973 | ) | | | (1,610,356 | ) |
RETAIL—0.0% | | | | | | | | |
CBL & Associates Properties, Inc. | | | (75 | ) | | | (2,309 | ) |
Pennsylvania Real Estate Investment Trust | | | (402 | ) | | | (2,191 | ) |
| | | | | | | (4,500 | ) |
TOTAL REAL ESTATE INVESTMENT TRUST | | | | | | | | |
(Proceeds $6,305,072) | | | | | | $ | (4,880,381 | ) |
Total Securities Sold Short | | | | | | | | |
(Proceeds $289,609,471) | | | | | | $ | (234,044,246 | ) |
See Notes to Financial Statements.
THE ALGER FUNDS II | ALGER EMERGING MARKETS FUND
Schedule of Investments July 31, 2022 (Unaudited)
COMMON STOCKS—97.9% | | SHARES | | | VALUE | |
ARGENTINA—4.8% | | | | | | | | |
IT CONSULTING & OTHER SERVICES—4.8% | | | | | | | | |
Globant SA* | | | 7,350 | | | $ | 1,464,414 | |
(Cost $1,756,061) | | | | | | | | |
BRAZIL—12.5% | | | | | | | | |
ASSET MANAGEMENT & CUSTODY BANKS—1.0% | | | | | | | | |
Vinci Partners Investments Ltd., Cl. A | | | 31,922 | | | | 307,728 | |
DIVERSIFIED CAPITAL MARKETS—3.4% | | | | | | | | |
Banco BTG Pactual SA | | | 237,000 | | | | 1,031,918 | |
FOOTWEAR—4.2% | | | | | | | | |
Arezzo Industria e Comercio SA | | | 84,000 | | | | 1,284,890 | |
HEALTHCARE FACILITIES—1.1% | | | | | | | | |
Rede D’Or Sao Luiz SA | | | 56,000 | | | | 350,538 | |
HEAVY ELECTRICAL EQUIPMENT—1.4% | | | | | | | | |
Aeris Industria E Comercio de Equipamentos Para Geracao de Energia SA | | | 714,000 | | | | 413,957 | |
RESEARCH & CONSULTING SERVICES—0.7% | | | | | | | | |
Boa Vista Servicos SA | | | 214,000 | | | | 222,501 | |
SPECIALTY STORES—0.7% | | | | | | | | |
Pet Center Comercio e Participacoes SA | | | 120,000 | | | | 224,488 | |
TOTAL BRAZIL | | | | | | | | |
(Cost $4,619,245) | | | | | | | 3,836,020 | |
CHINA—42.3% | | | | | | | | |
APPAREL ACCESSORIES & LUXURY GOODS—2.6% | | | | | | | | |
Li Ning Co., Ltd. | | | 99,000 | | | | 803,046 | |
APPLICATION SOFTWARE—4.5% | | | | | | | | |
Glodon Co., Ltd., Cl. A | | | 101,000 | | | | 694,313 | |
Thunder Software Technology Co., Ltd., Cl. A | | | 31,978 | | | | 675,516 | |
| | | | | | | 1,369,829 | |
ASSET MANAGEMENT & CUSTODY BANKS—1.6% | | | | | | | | |
Noah Holdings Ltd.#,* | | | 28,514 | | | | 496,144 | |
AUTOMOBILE MANUFACTURERS—5.2% | | | | | | | | |
BYD Co., Ltd., Cl. H | | | 43,522 | | | | 1,592,285 | |
BREWERS—4.8% | | | | | | | | |
Budweiser Brewing Co. APAC Ltd. | | | 528,000 | | | | 1,461,989 | |
DIVERSIFIED METALS & MINING—1.2% | | | | | | | | |
Ganfeng Lithium Co., Ltd., Cl. H | | | 42,000 | | | | 379,773 | |
FINANCIAL EXCHANGES & DATA—3.2% | | | | | | | | |
East Money Information Co., Ltd., Cl. A | | | 300,782 | | | | 994,184 | |
INDUSTRIAL MACHINERY—3.3% | | | | | | | | |
Han’s Laser Technology Industry Group Co., Ltd., Cl. A | | | 211,200 | | | | 995,467 | |
INTERNET & DIRECT MARKETING RETAIL—8.3% | | | | | | | | |
JD.com, Inc.# | | | 15,740 | | | | 936,530 | |
JD.com, Inc., Cl. A | | | 34,619 | | | | 1,032,767 | |
THE ALGER FUNDS II | ALGER EMERGING MARKETS FUND
Schedule of Investments July 31, 2022 (Unaudited) (Continued)
COMMON STOCKS—97.9% (CONT.) | | SHARES | | | VALUE | |
CHINA—42.3% (CONT.) | | | | | | | | |
INTERNET & DIRECT MARKETING RETAIL—8.3% (CONT.) | | | | | | | | |
Meituan, Cl. B* | | | 26,000 | | | $ | 583,263 | |
| | | | | | | 2,552,560 | |
OIL & GAS DRILLING—3.1% | | | | | | | | |
China Oilfield Services Ltd., Cl. H | | | 1,040,000 | | | | 958,018 | |
SEMICONDUCTORS—4.5% | | | | | | | | |
LONGi Green Energy Technology Co., Ltd., Cl. A | | | 148,971 | | | | 1,362,097 | |
TOTAL CHINA | | | | | | | | |
(Cost $14,529,739) | | | | | | | 12,965,392 | |
GREECE—2.4% | | | | | | | | |
SPECIALTY STORES—2.4% | | | | | | | | |
JUMBO SA | | | 47,500 | | | | 736,297 | |
(Cost $824,758) | | | | | | | | |
HONG KONG—2.4% | | | | | | | | |
FINANCIAL EXCHANGES & DATA—2.4% | | | | | | | | |
Hong Kong Exchanges & Clearing Ltd. | | | 16,176 | | | | 742,319 | |
(Cost $908,184) | | | | | | | | |
INDIA—9.6% | | | | | | | | |
APPLICATION SOFTWARE—1.3% | | | | | | | | |
Route Mobile Ltd. | | | 22,000 | | | | 390,429 | |
DIVERSIFIED BANKS—2.6% | | | | | | | | |
HDFC Bank Ltd. | | | 43,500 | | | | 793,458 | |
HOUSEHOLD APPLIANCES—1.1% | | | | | | | | |
Amber Enterprises India Ltd.* | | | 11,000 | | | | 347,183 | |
INVESTMENT BANKING & BROKERAGE—1.7% | | | | | | | | |
Angel One Ltd. | | | 31,000 | | | | 537,818 | |
LIFE SCIENCES TOOLS & SERVICES—2.9% | | | | | | | | |
Syngene International Ltd. | | | 123,000 | | | | 883,877 | |
TOTAL INDIA | | | | | | | | |
(Cost $3,518,727) | | | | | | | 2,952,765 | |
INDONESIA—2.1% | | | | | | | | |
REGIONAL BANKS—2.1% | | | | | | | | |
Bank BTPN Syariah Tbk PT | | | 3,358,570 | | | | 637,242 | |
(Cost $799,775) | | | | | | | | |
SOUTH KOREA—5.8% | | | | | | | | |
SEMICONDUCTORS—2.7% | | | | | | | | |
LEENO Industrial, Inc. | | | 8,189 | | | | 829,127 | |
SPECIALTY CHEMICALS—3.1% | | | | | | | | |
Chunbo Co., Ltd. | | | 5,123 | | | | 931,316 | |
TOTAL SOUTH KOREA | | | | | | | | |
(Cost $1,520,843) | | | | | | | 1,760,443 | |
TAIWAN—8.1% | | | | | | | | |
ELECTRONIC EQUIPMENT & INSTRUMENTS—2.9% | | | | | | | | |
Chroma ATE, Inc. | | | 155,000 | | | | 892,341 | |
THE ALGER FUNDS II | ALGER EMERGING MARKETS FUND
Schedule of Investments July 31, 2022 (Unaudited) (Continued)
COMMON STOCKS—97.9% (CONT.) | | SHARES | | | VALUE | |
TAIWAN—8.1% (CONT.) | | | | | | | | |
SEMICONDUCTORS—5.2% | | | | | | | | |
Realtek Semiconductor Corp. | | | 51,000 | | | $ | 584,807 | |
Taiwan Semiconductor Manufacturing Co., Ltd. | | | 59,500 | | | | 1,017,477 | |
| | | | | | | 1,602,284 | |
TOTAL TAIWAN | | | | | | | | |
(Cost $3,247,496) | | | | | | | 2,494,625 | |
UNITED STATES—5.7% | | | | | | | | |
IT CONSULTING & OTHER SERVICES—5.7% | | | | | | | | |
EPAM Systems, Inc.* | | | 4,950 | | | | 1,728,788 | |
(Cost $1,256,175) | | | | | | | | |
VIETNAM—2.2% | | | | | | | | |
REAL ESTATE DEVELOPMENT—2.2% | | | | | | | | |
Vinhomes JSC | | | 266,500 | | | | 685,006 | |
(Cost $923,854) | | | | | | | | |
TOTAL COMMON STOCKS | | | | | | | | |
(Cost $33,904,857) | | | | | | | 30,003,311 | |
Total Investments | | | | | | | | |
(Cost $33,904,857) | | | 97.9 | % | | $ | 30,003,311 | |
Unaffiliated Securities (Cost $33,904,857) | | | | | | | 30,003,311 | |
Other Assets in Excess of Liabilities | | | 2.1 | % | | | 647,586 | |
NET ASSETS | | | 100.0 | % | | $ | 30,650,897 | |
| # | American Depositary Receipts. |
| * | Non-income producing security. |
See Notes to Financial Statements.
THE ALGER FUNDS II | ALGER RESPONSIBLE INVESTING FUND
Schedule of Investments July 31, 2022 (Unaudited)
COMMON STOCKS—96.6% | | SHARES | | | VALUE | |
AGRICULTURAL & FARM MACHINERY—0.7% | | | | | | | | |
Deere & Co. | | | 1,527 | | | $ | 524,036 | |
APPAREL ACCESSORIES & LUXURY GOODS—1.4% | | | | | | | | |
Levi Strauss & Co., Cl. A | | | 18,358 | | | | 347,333 | |
Lululemon Athletica, Inc.* | | | 2,388 | | | | 741,498 | |
| | | | | | | 1,088,831 | |
APPLICATION SOFTWARE—8.9% | | | | | | | | |
Adobe, Inc.* | | | 5,654 | | | | 2,318,819 | |
Autodesk, Inc.* | | | 3,176 | | | | 687,032 | |
Bill.com Holdings, Inc.* | | | 1,861 | | | | 251,384 | |
Intuit, Inc. | | | 2,702 | | | | 1,232,571 | |
Paycom Software, Inc.* | | | 947 | | | | 312,974 | |
Salesforce, Inc.* | | | 10,491 | | | | 1,930,554 | |
| | | | | | | 6,733,334 | |
AUTO PARTS & EQUIPMENT—0.8% | | | | | | | | |
Aptiv PLC* | | | 5,666 | | | | 594,307 | |
AUTOMOBILE MANUFACTURERS—3.1% | | | | | | | | |
Tesla, Inc.* | | | 2,633 | | | | 2,347,188 | |
BIOTECHNOLOGY—1.0% | | | | | | | | |
Vertex Pharmaceuticals, Inc.* | | | 2,680 | | | | 751,499 | |
BUILDING PRODUCTS—0.5% | | | | | | | | |
Allegion PLC | | | 3,268 | | | | 345,428 | |
CONSUMER FINANCE—0.5% | | | | | | | | |
American Express Co. | | | 2,261 | | | | 348,239 | |
DATA PROCESSING & OUTSOURCED SERVICES—4.9% | | | | | | | | |
PayPal Holdings, Inc.* | | | 4,775 | | | | 413,181 | |
Visa, Inc., Cl. A | | | 15,505 | | | | 3,288,765 | |
| | | | | | | 3,701,946 | |
DISTRIBUTORS—0.4% | | | | | | | | |
Pool Corp. | | | 929 | | | | 332,303 | |
ELECTRIC UTILITIES—0.7% | | | | | | | | |
NextEra Energy, Inc. | | | 5,908 | | | | 499,167 | |
ELECTRICAL COMPONENTS & EQUIPMENT—1.8% | | | | | | | | |
Eaton Corp., PLC | | | 3,523 | | | | 522,778 | |
Generac Holdings, Inc.* | | | 1,496 | | | | 401,377 | |
Rockwell Automation, Inc. | | | 1,599 | | | | 408,193 | |
| | | | | | | 1,332,348 | |
ELECTRONIC EQUIPMENT & INSTRUMENTS—1.2% | | | | | | | | |
Cognex Corp. | | | 3,907 | | | | 199,179 | |
Trimble, Inc.* | | | 7,334 | | | | 509,199 | |
Zebra Technologies Corp., Cl. A* | | | 530 | | | | 189,576 | |
| | | | | | | 897,954 | |
ELECTRONIC MANUFACTURING SERVICES—1.3% | | | | | | | | |
Flex Ltd.* | | | 56,652 | | | | 951,754 | |
ENVIRONMENTAL & FACILITIES SERVICES—0.7% | | | | | | | | |
Tetra Tech, Inc. | | | 3,425 | | | | 524,950 | |
THE ALGER FUNDS II | ALGER RESPONSIBLE INVESTING FUND
Schedule of Investments July 31, 2022 (Unaudited) (Continued)
COMMON STOCKS—96.6% (CONT.) | | SHARES | | | VALUE | |
FINANCIAL EXCHANGES & DATA—2.7% | | | | | | | | |
CME Group, Inc., Cl. A | | | 2,074 | | | $ | 413,722 | |
S&P Global, Inc. | | | 4,366 | | | | 1,645,676 | |
| | | | | | | 2,059,398 | |
FOOD DISTRIBUTORS—0.7% | | | | | | | | |
Sysco Corp. | | | 5,920 | | | | 502,608 | |
FOOTWEAR—1.2% | | | | | | | | |
NIKE, Inc., Cl. B | | | 8,142 | | | | 935,679 | |
HEALTHCARE DISTRIBUTORS—0.5% | | | | | | | | |
McKesson Corp. | | | 1,041 | | | | 355,585 | |
HEALTHCARE EQUIPMENT—0.9% | | | | | | | | |
Dexcom, Inc.* | | | 2,700 | | | | 221,616 | |
Edwards Lifesciences Corp.* | | | 4,366 | | | | 438,958 | |
| | | | | | | 660,574 | |
HEALTHCARE SERVICES—1.4% | | | | | | | | |
Cigna Corp. | | | 3,875 | | | | 1,067,020 | |
HEALTHCARE SUPPLIES—0.4% | | | | | | | | |
Align Technology, Inc.* | | | 1,128 | | | | 316,934 | |
HOME IMPROVEMENT RETAIL—2.4% | | | | | | | | |
The Home Depot, Inc. | | | 6,091 | | | | 1,833,026 | |
HOUSEHOLD PRODUCTS—1.2% | | | | | | | | |
The Procter & Gamble Co. | | | 6,776 | | | | 941,254 | |
INDUSTRIAL CONGLOMERATES—1.1% | | | | | | | | |
Honeywell International, Inc. | | | 4,177 | | | | 803,905 | |
INDUSTRIAL GASES—0.9% | | | | | | | | |
Air Products & Chemicals, Inc. | | | 2,905 | | | | 721,108 | |
INDUSTRIAL MACHINERY—0.6% | | | | | | | | |
Xylem, Inc. | | | 5,375 | | | | 494,661 | |
INTERACTIVE HOME ENTERTAINMENT—0.5% | | | | | | | | |
Take-Two Interactive Software, Inc.* | | | 3,084 | | | | 409,339 | |
INTERACTIVE MEDIA & SERVICES—4.6% | | | | | | | | |
Alphabet, Inc., Cl. A* | | | 16,160 | | | | 1,879,731 | |
Alphabet, Inc., Cl. C* | | | 13,940 | | | | 1,625,962 | |
| | | | | | | 3,505,693 | |
INTERNET & DIRECT MARKETING RETAIL—6.4% | | | | | | | | |
Amazon.com, Inc.* | | | 35,940 | | | | 4,850,103 | |
INVESTMENT BANKING & BROKERAGE—1.3% | | | | | | | | |
Morgan Stanley | | | 11,732 | | | | 989,008 | |
IT CONSULTING & OTHER SERVICES—1.0% | | | | | | | | |
Accenture PLC, Cl. A | | | 2,401 | | | | 735,330 | |
LEISURE FACILITIES—0.8% | | | | | | | | |
Vail Resorts, Inc. | | | 2,419 | | | | 573,617 | |
LIFE SCIENCES TOOLS & SERVICES—2.3% | | | | | | | | |
Agilent Technologies, Inc. | | | 4,610 | | | | 618,201 | |
Danaher Corp. | | | 3,769 | | | | 1,098,550 | |
| | | | | | | 1,716,751 | |
MANAGED HEALTHCARE—1.2% | | | | | | | | |
Humana, Inc. | | | 1,867 | | | | 899,894 | |
THE ALGER FUNDS II | ALGER RESPONSIBLE INVESTING FUND
Schedule of Investments July 31, 2022 (Unaudited) (Continued)
COMMON STOCKS—96.6% (CONT.) | | SHARES | | | VALUE | |
METAL & GLASS CONTAINERS—0.9% | | | | | | | | |
Ball Corp. | | | 9,682 | | | $ | 710,852 | |
MOVIES & ENTERTAINMENT—1.0% | | | | | | | | |
Live Nation Entertainment, Inc.* | | | 8,120 | | | | 763,199 | |
PHARMACEUTICALS—2.9% | | | | | | | | |
Bristol-Myers Squibb Co. | | | 8,904 | | | | 656,937 | |
Merck & Co., Inc. | | | 8,311 | | | | 742,505 | |
Zoetis, Inc., Cl. A | | | 4,472 | | | | 816,363 | |
| | | | | | | 2,215,805 | |
RAILROADS—0.8% | | | | | | | | |
Union Pacific Corp. | | | 2,735 | | | | 621,666 | |
RESTAURANTS—0.9% | | | | | | | | |
Starbucks Corp. | | | 7,708 | | | | 653,484 | |
SEMICONDUCTOR EQUIPMENT—4.8% | | | | | | | | |
Applied Materials, Inc. | | | 6,450 | | | | 683,571 | |
ASML Holding NV# | | | 1,580 | | | | 907,615 | |
Lam Research Corp. | | | 2,569 | | | | 1,285,810 | |
SolarEdge Technologies, Inc.* | | | 2,094 | | | | 754,113 | |
| | | | | | | 3,631,109 | |
SEMICONDUCTORS—5.3% | | | | | | | | |
Advanced Micro Devices, Inc.* | | | 4,705 | | | | 444,481 | |
NVIDIA Corp. | | | 11,997 | | | | 2,179,015 | |
Taiwan Semiconductor Manufacturing Co., Ltd.# | | | 11,145 | | | | 986,110 | |
Universal Display Corp. | | | 3,508 | | | | 405,034 | |
| | | | | | | 4,014,640 | |
SOFT DRINKS—1.4% | | | | | | | | |
PepsiCo, Inc. | | | 5,971 | | | | 1,044,686 | |
SYSTEMS SOFTWARE—11.6% | | | | | | | | |
Microsoft Corp. | | | 31,384 | | | | 8,810,744 | |
TECHNOLOGY HARDWARE STORAGE & PERIPHERALS—7.0% | | | | | | | | |
Apple, Inc. | | | 32,436 | | | | 5,271,174 | |
TOTAL COMMON STOCKS | | | | | | | | |
(Cost $34,433,293) | | | | | | | 73,082,130 | |
REAL ESTATE INVESTMENT TRUST—3.2% | | SHARES | | | VALUE | |
INDUSTRIAL—1.3% | | | | | | | | |
Prologis, Inc. | | | 7,288 | | | | 966,097 | |
SPECIALIZED—1.9% | | | | | | | | |
Equinix, Inc. | | | 1,513 | | | | 1,064,759 | |
SBA Communications Corp., Cl. A | | | 1,119 | | | | 375,749 | |
| | | | | | | 1,440,508 | |
TOTAL REAL ESTATE INVESTMENT TRUST | | | | | | | | |
(Cost $1,412,758) | | | | | | | 2,406,605 | |
THE ALGER FUNDS II | ALGER RESPONSIBLE INVESTING FUND
Schedule of Investments July 31, 2022 (Unaudited) (Continued)
| | | | | VALUE | |
Total Investments | | | | | | | | |
(Cost $35,846,051) | | | 99.8 | % | | $ | 75,488,735 | |
Unaffiliated Securities (Cost $35,846,051) | | | | | | | 75,488,735 | |
Other Assets in Excess of Liabilities | | | 0.2 | % | | | 167,537 | |
NET ASSETS | | | 100.0 | % | | $ | 75,656,272 | |
| # | American Depositary Receipts. |
| * | Non-income producing security. |
See Notes to Financial Statements.
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited)
NOTE 1 — General:
The Alger Funds II (the “Trust”) is an open-end registered investment company organized as a business trust under the laws of the Commonwealth of Massachusetts. The Trust qualifies as an investment company as defined in Financial Accounting Standards Board (“FASB”) 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 four series – Alger Spectra Fund, Alger Dynamic Opportunities Fund, Alger Emerging Markets Fund and Alger Responsible Investing 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, C, I, Y and Z. Class A shares are generally subject to an initial sales charge while Class C shares are generally subject to a deferred sales charge. Class C shares will automatically convert to Class A shares on the fifth business day of the month following the eighth anniversary of the purchase date of a shareholder’s Class C shares, without the imposition of any sales load, fee or other charge. Class C shares held at certain dealers may not convert to Class A shares or may be converted on a different schedule. At conversion, a proportionate amount of shares representing reinvested dividends and distributions will also be converted into Class A shares. Effective August 27, 2019, Class C shares were closed to direct shareholders and are only available for purchase through certain financial intermediaries and group retirement plan recordkeeping platforms, Class I shares, Class Z shares and Class Y shares are sold to institutional investors without an initial or deferred sales charge and Class Z shares and Class Y shares are generally subject to a minimum initial investment of $500,000. Each class has identical rights to assets and earnings, except that each share class bears the pro rata allocation of the Fund’s expenses other than a class expense (not including advisory or custodial fees or other expenses related to the management of the Fund’s assets).
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 Trust’s Board of Trustees (the “Board”). Investments held by the Funds 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).
Investments in money market funds and short-term securities held by the Funds having a remaining maturity of sixty days or less are valued at amortized cost which approximates market value.
Equity securities, including traded rights, warrants and option contracts for which valuation information is readily available, are valued at the last quoted sales price or official closing price on the primary market or exchange on which they are traded as reported by an independent pricing service. 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.
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Swap contracts are privately negotiated in the over-the-counter market (“OTC Swaps”) or may be executed in a multilateral or other trade facility platform, such as a registered commodities exchange (“Centrally Cleared Swaps”). Centrally cleared swaps are valued at the last reported sale on the clearing exchange.
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 and described further herein.
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 closing prices to reflect what the Trust’s investment adviser, pursuant to policies established by the Board, 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 Funds are open.
FASB 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.) |
| ● | Level 3 – 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, but are not limited to, revenue multiples, earnings before interest, taxes, depreciation and amortization (“EBITDA”) multiples, discount rates, time to exit and the probabilities of success of certain outcomes. Such unobservable market information may be obtained from a company’s financial statements and from industry studies, market data, and market indicators such as benchmarks and indexes. Because of the inherent uncertainty and often limited markets for restricted securities, the valuations assigned to such securities by the Funds may significantly differ from the valuations that would have been assigned by the Funds had there been an active market for such securities.
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Valuation processes are determined by a Valuation Committee (“Committee”) authorized by the Board and comprised of representatives of the Trust’s investment adviser and officers of the Trust. The Committee reports its fair value determinations and related valuation information to the Board. The Board is responsible for approving the valuation policy and procedures.
While Committee meetings are held on an as-needed basis, the Committee generally 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 the previous day’s prices.
In December 2020, the Securities and Exchange Commission (the “SEC”) adopted Rule 2a-5 under the Investment Company Act of 1940, as amended (the “1940 Act”), which is intended to address valuation practices and the role of the board of directors with respect to the fair value of the investments of a registered investment company. Among other things, Rule 2a-5 will permit the Board to designate the Funds’ investment adviser, Fred Alger Management, LLC (“Alger Management” or the “Investment Manager”), to perform the Funds’ fair value determinations, which will be subject to the Board’s oversight and certain reporting and other requirements intended to ensure that the Board receives the information it needs to oversee the Investment Manager’s fair value determinations. Compliance with Rule 2a-5 will not be required until September 2022. The Funds, the Board, and the Investment Manager are currently in the process of implementing the requirements of Rule 2a-5 for compliance with these requirements by the September 2022 compliance deadline.
(b) Cash and Cash Equivalents: Cash and cash equivalents include U.S. dollars, foreign cash and overnight time deposits.
NOTE 3 — Fair Value Measurements:
The following is a summary of the inputs used as of July 31, 2022, 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.
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Alger Spectra Fund | | TOTAL | | | LEVEL 1 | | | LEVEL 2 | | | LEVEL 3 | |
COMMON STOCKS | | | | | | | | | | | | | | | | |
Communication Services | | $ | 382,876,935 | | | $ | 354,677,899 | | | $ | 28,199,036 | | | $ | — | |
Consumer Discretionary | | | 886,122,679 | | | | 885,079,578 | | | | — | | | | 1,043,101 | |
Consumer Staples | | | 83,876,059 | | | | 83,876,059 | | | | — | | | | — | |
Energy | | | 275,056,987 | | | | 275,056,987 | | | | — | | | | — | |
Financials | | | 137,703,046 | | | | 137,703,046 | | | | — | | | | — | |
Healthcare | | | 914,098,816 | | | | 887,557,521 | | | | 26,541,295 | | | | — | |
Industrials | | | 297,925,559 | | | | 297,925,559 | | | | — | | | | — | |
Information Technology | | | 1,533,436,705 | | | | 1,533,436,705 | | | | — | | | | — | |
Materials | | | 71,043,882 | | | | 71,043,882 | | | | — | | | | — | |
Real Estate | | | 41,752,325 | | | | 41,752,325 | | | | — | | | | — | |
Utilities | | | 53,978,295 | | | | 53,978,295 | | | | — | | | | — | |
TOTAL COMMON STOCKS | | $ | 4,677,871,288 | | | $ | 4,622,087,856 | | | $ | 54,740,331 | | | $ | 1,043,101 | |
PREFERRED STOCKS | | | | | | | | | | | | | | | | |
Healthcare | | | — | * | | | — | | | | — | | | | — | * |
Information Technology | | | 9,310,343 | | | | — | | | | — | | | | 9,310,343 | |
TOTAL PREFERRED STOCKS | | $ | 9,310,343 | | | $ | — | | | $ | — | | | $ | 9,310,343 | |
REAL ESTATE INVESTMENT TRUST | | | | | | | | | | | | | | | | |
Real Estate | | | 32,044,567 | | | | 32,044,567 | | | | — | | | | — | |
SPECIAL PURPOSE VEHICLE | | | | | | | | | | | | | | | | |
Information Technology | | | 14,187,516 | | | | — | | | | — | | | | 14,187,516 | |
TOTAL INVESTMENTS IN SECURITIES | | $ | 4,733,413,714 | | | $ | 4,654,132,423 | | | $ | 54,740,331 | | | $ | 24,540,960 | |
SECURITIES SOLD SHORT COMMON STOCKS | | | | | | | | | | | | | | | | |
Communication Services | | | 9,348,483 | | | | 9,348,483 | | | | — | | | | — | |
Consumer Discretionary | | | 91,185,441 | | | | 91,185,441 | | | | — | | | | — | |
Consumer Staples | | | 20,501,695 | | | | 20,501,695 | | | | — | | | | — | |
Exchange Traded Funds | | | 47,547,755 | | | | 47,547,755 | | | | — | | | | — | |
Financials | | | 28,894,474 | | | | 28,894,474 | | | | — | | | | — | |
Healthcare | | | 25,239,103 | | | | 25,239,103 | | | | — | | | | — | |
Information Technology | | | 48,832,885 | | | | 48,832,885 | | | | — | | | | — | |
Market Indices | | | 132,959,752 | | | | 132,959,752 | | | | — | | | | — | |
TOTAL COMMON STOCKS | | $ | 404,509,588 | | | $ | 404,509,588 | | | $ | — | | | $ | — | |
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Alger Dynamic Opportunities Fund | | TOTAL | | | LEVEL 1 | | | LEVEL 2 | | | LEVEL 3 | |
COMMON STOCKS | | | | | | | | | | | | | | | | |
Communication Services | | $ | 12,582,663 | | | $ | 8,524,332 | | | $ | 4,058,331 | | | $ | — | |
Consumer Discretionary | | | 48,917,460 | | | | 48,917,460 | | | | — | | | | — | |
Energy | | | 36,976,122 | | | | 36,976,122 | | | | — | | | | — | |
Financials | | | 36,232,011 | | | | 36,232,011 | | | | — | | | | — | |
Healthcare | | | 82,063,121 | | | | 77,377,888 | | | | 1,199,968 | | | | 3,485,265 | |
Industrials | | | 71,046,772 | | | | 71,046,772 | | | | — | | | | — | |
Information Technology | | | 120,492,139 | | | | 120,492,139 | | | | — | | | | — | |
Materials | | | 9,063,863 | | | | 9,063,863 | | | | — | | | | — | |
Real Estate | | | 13,241,862 | | | | 13,241,862 | | | | — | | | | — | |
TOTAL COMMON STOCKS | | $ | 430,616,013 | | | $ | 421,872,449 | | | $ | 5,258,299 | | | $ | 3,485,265 | |
PREFERRED STOCKS | | | | | | | | | | | | | | | | |
Healthcare | | | — | * | | | — | | | | — | | | | — | * |
RIGHTS | | | | | | | | | | | | | | | | |
Healthcare | | | 74,404 | | | | — | | | | — | | | | 74,404 | |
REAL ESTATE INVESTMENT TRUST | | | | | | | | | | | | | | | | |
Real Estate | | | 2,464,025 | | | | 2,464,025 | | | | — | | | | — | |
SPECIAL PURPOSE VEHICLE | | | | | | | | | | | | | | | | |
Information Technology | | | 1,754,439 | | | | — | | | | — | | | | 1,754,439 | |
PURCHASED OPTIONS | | | | | | | | | | | | | | | | |
Healthcare | | | 153,000 | | | | 58,500 | | | | 94,500 | | | | — | |
TOTAL INVESTMENTS IN SECURITIES | | $ | 435,061,881 | | | $ | 424,394,974 | | | $ | 5,352,799 | | | $ | 5,314,108 | |
SECURITIES SOLD SHORT COMMON STOCKS | | | | | | | | | | | | | | | | |
Communication Services | | | 9,107,921 | | | | 9,107,921 | | | | — | | | | — | |
Consumer Discretionary | | | 45,007,117 | | | | 45,007,117 | | | | — | | | | — | |
Consumer Staples | | | 3,015,416 | | | | 3,015,416 | | | | — | | | | — | |
Exchange Traded Funds | | | 32,233,714 | | | | 32,233,714 | | | | — | | | | — | |
Financials | | | 10,515,192 | | | | 10,515,192 | | | | — | | | | — | |
Healthcare | | | 22,631,732 | | | | 22,012,596 | | | | 619,136 | | | | — | |
Industrials | | | 33,219,918 | | | | 33,219,918 | | | | — | | | | — | |
Information Technology | | | 40,709,028 | | | | 40,709,028 | | | | — | | | | — | |
Market Indices | | | 11,020,821 | | | | 11,020,821 | | | | — | | | | — | |
Materials | | | 14,054,167 | | | | 14,054,167 | | | | — | | | | — | |
Real Estate | | | 7,648,839 | | | | 7,648,839 | | | | — | | | | — | |
TOTAL COMMON STOCKS | | $ | 229,163,865 | | | $ | 228,544,729 | | | $ | 619,136 | | | $ | — | |
REAL ESTATE INVESTMENT TRUST | | | | | | | | | | | | | | | | |
Real Estate | | | 4,880,381 | | | | 4,880,381 | | | | — | | | | — | |
TOTAL SECURITIES SOLD SHORT | | $ | 234,044,246 | | | $ | 233,425,110 | | | $ | 619,136 | | | $ | — | |
FINANCIAL DERIVATIVE INSTRUMENTS - ASSETS | | | | | | | | | | | | | | | | |
Swaps - Contracts for difference | | $ | 106,649 | | | $ | — | | | $ | 106,649 | | | $ | — | |
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Alger Emerging Markets Fund | | TOTAL | | | LEVEL 1 | | | LEVEL 2 | | | LEVEL 3 | |
COMMON STOCKS | | | | | | | | | | | | | | | | |
Consumer Discretionary | | $ | 7,540,749 | | | $ | 2,445,908 | | | $ | 5,094,841 | | | $ | — | |
Consumer Staples | | | 1,461,989 | | | | — | | | | 1,461,989 | | | | — | |
Energy | | | 958,018 | | | | — | | | | 958,018 | | | | — | |
Financials | | | 5,540,811 | | | | 1,835,790 | | | | 3,705,021 | | | | — | |
Healthcare | | | 1,234,415 | | | | 350,538 | | | | 883,877 | | | | — | |
Industrials | | | 1,631,925 | | | | 636,458 | | | | 995,467 | | | | — | |
Information Technology | | | 9,639,309 | | | | 3,193,202 | | | | 6,446,107 | | | | — | |
Materials | | | 1,311,089 | | | | — | | | | 1,311,089 | | | | — | |
Real Estate | | | 685,006 | | | | — | | | | 685,006 | | | | — | |
TOTAL COMMON STOCKS | | $ | 30,003,311 | | | $ | 8,461,896 | | | $ | 21,541,415 | | | $ | — | |
TOTAL INVESTMENTS IN SECURITIES | | $ | 30,003,311 | | | $ | 8,461,896 | | | $ | 21,541,415 | | | $ | — | |
Alger Responsible Investing Fund | | TOTAL | | | LEVEL 1 | | | LEVEL 2 | | | LEVEL 3 | |
COMMON STOCKS | | | | | | | | | | | | | | | | |
Communication Services | | | 4,678,231 | | | | 4,678,231 | | | | — | | | | — | |
Consumer Discretionary | | | 13,208,538 | | | | 13,208,538 | | | | — | | | | — | |
Consumer Staples | | | 2,488,548 | | | | 2,488,548 | | | | — | | | | — | |
Financials | | | 3,396,645 | | | | 3,396,645 | | | | — | | | | — | |
Healthcare | | | 7,984,062 | | | | 7,984,062 | | | | — | | | | — | |
Industrials | | | 4,646,994 | | | | 4,646,994 | | | | — | | | | — | |
Information Technology | | | 34,747,985 | | | | 34,747,985 | | | | — | | | | — | |
Materials | | | 1,431,960 | | | | 1,431,960 | | | | — | | | | — | |
Utilities | | | 499,167 | | | | 499,167 | | | | — | | | | — | |
TOTAL COMMON STOCKS | | $ | 73,082,130 | | | $ | 73,082,130 | | | $ | — | | | $ | — | |
REAL ESTATE INVESTMENT TRUST | | | | | | | | | | | | | | | | |
Real Estate | | | 2,406,605 | | | | 2,406,605 | | | | — | | | | — | |
TOTAL INVESTMENTS IN SECURITIES | | $ | 75,488,735 | | | $ | 75,488,735 | | | $ | — | | | $ | — | |
*Alger Spectra Fund’s and Alger Dynamic Opportunities Fund’s holdings of Prosetta Biosciences, Inc., Series D shares are classified as a Level 3 investment and are fair valued at zero as of July 31, 2022.
| | FAIR VALUE MEASUREMENTS USING SIGNIFICANT UNOBSERVABLE INPUTS (LEVEL 3) | |
Alger Spectra Fund | | Common Stocks | |
Opening balance at November 1, 2021 | | $ | 2,371,235 | |
Transfers into Level 3 | | | — | |
Transfers out of Level 3 | | | — | |
Total gains or losses | | | | |
Included in net realized gain (loss) on investments | | | — | |
Included in net change in unrealized appreciation (depreciation) on investments | | | (1,328,134 | ) |
Purchases and sales | | | | |
Purchases | | | — | |
Sales | | | — | |
Closing balance at July 31, 2022 | | | 1,043,101 | |
Net change in unrealized appreciation (depreciation) attributable to investments still held at July 31, 2022 | | $ | (1,328,134 | ) |
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
| | FAIR VALUE MEASUREMENTS USING SIGNIFICANT UNOBSERVABLE INPUTS (LEVEL 3) | |
Alger Spectra Fund | | Preferred Stocks | |
Opening balance at November 1, 2021 | | $ | 13,025,390 | * |
Transfers into Level 3 | | | — | |
Transfers out of Level 3 | | | — | |
Total gains or losses | | | | |
Included in net realized gain (loss) on investments | | | — | |
Included in net change in unrealized appreciation (depreciation) on investments | | | (3,715,047 | ) |
Purchases and sales | | | | |
Purchases | | | — | |
Sales | | | — | |
Closing balance at July 31, 2022 | | | 9,310,343 | * |
Net change in unrealized appreciation (depreciation) attributable to investments still held at July 31, 2022 | | $ | (3,715,047 | ) |
Alger Spectra Fund | | Special Purpose Vehicle | |
Opening balance at November 1, 2021 | | $ | 19,486,623 | |
Transfers into Level 3 | | | — | |
Transfers out of Level 3 | | | — | |
Total gains or losses | | | | |
Included in net realized gain (loss) on investments | | | — | |
Included in net change in unrealized appreciation (depreciation) on investments | | | (5,299,107 | ) |
Purchases and sales | | | | |
Purchases | | | — | |
Sales | | | — | |
Closing balance at July 31, 2022 | | | 14,187,516 | |
Net change in unrealized appreciation (depreciation) attributable to investments still held at July 31, 2022 | | $ | (5,299,107 | ) |
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, 2021 | | $ | — | |
Transfers into Level 3 | | | — | |
Transfers out of Level 3 | | | — | |
Total gains or losses | | | | |
Included in net realized gain (loss) on investments | | | — | |
Included in net change in unrealized appreciation (depreciation) on investments | | | — | |
Purchases and sales | | | | |
Purchases | | | 3,485,265 | |
Sales | | | — | |
Closing balance at July 31, 2022 | | | 3,485,265 | |
Net change in unrealized appreciation (depreciation) attributable to investments still held at July 31, 2022 | | $ | — | |
Alger Dynamic Opportunities Fund | | Preferred Stocks | |
Opening balance at November 1, 2021 | | $ | — | * |
Transfers into Level 3 | | | — | |
Transfers out of Level 3 | | | — | |
Total gains or losses | | | | |
Included in net realized gain (loss) on investments | | | — | |
Included in net change in unrealized appreciation (depreciation) on investments | | | — | |
| | | | |
Purchases and sales | | | | |
Purchases | | | — | |
Sales | | | — | |
Closing balance at July 31, 2022 | | | — | * |
Net change in unrealized appreciation (depreciation) attributable to investments still held at July 31, 2022 | | $ | — | |
Alger Dynamic Opportunities Fund | | Rights | |
Opening balance at November 1, 2021 | | $ | 94,581 | |
Transfers into Level 3 | | | — | |
Transfers out of Level 3 | | | — | |
Total gains or losses | | | | |
Included in net realized gain (loss) on investments | | | — | |
Included in net change in unrealized appreciation (depreciation) on investments | | | (20,177 | ) |
| | | | |
Purchases and sales | | | | |
Purchases | | | — | |
Sales | | | — | |
Closing balance at July 31, 2022 | | | 74,404 | |
Net change in unrealized appreciation (depreciation) attributable to investments still held at July 31, 2022 | | $ | (20,177 | ) |
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
| | FAIR VALUE MEASUREMENTS USING SIGNIFICANT UNOBSERVABLE INPUTS (LEVEL 3) | |
Alger Dynamic Opportunities Fund | | Special Purpose Vehicle | |
Opening balance at November 1, 2021 | | $ | 2,408,930 | |
Transfers into Level 3 | | | — | |
Transfers out of Level 3 | | | — | |
Total gains or losses | | | | |
Included in net realized gain (loss) on investments | | | — | |
Included in net change in unrealized appreciation (depreciation) on investments | | | (654,491 | ) |
Purchases and sales | | | | |
Purchases | | | — | |
Sales | | | — | |
Closing balance at July 31, 2022 | | | 1,754,439 | |
Net change in unrealized appreciation (depreciation) attributable to investments still held at July 31, 2022 | | $ | (654,491 | ) |
* Includes securities that are fair valued at zero.
The following table provides quantitative information about each Fund’s Level 3 fair value measurements of its investments as of July 31, 2022. The table below is not intended to be all-inclusive, but rather provides information on the Level 3 inputs as they relate to each Fund’s fair value measurements.
| | Fair Value July 31, 2022 | | Valuation Methodology | | Unobservable Input | | Input/Range | | Weighted Average Inputs |
Alger Spectra Fund | | | | | | | | | | |
Common Stocks | $ | 1,043,101 | | Income Approach | | Discount Rate Probability of Success | | 6.80% 15.00%-50.00% | | N/A |
Preferred Stocks | | —* | | Income Approach | | Discount Rate | | 100.00% | | N/A |
Preferred Stocks | | 9,310,343 | | Market Approach | | Transaction Price Revenue Multiple | | N/A 20.00x-22.00x | | N/A |
Special Purpose Vehicle | | 14,187,516 | | Market Approach | | Transaction Price Revenue Multiple | | N/A 20.00x-22.00x | | N/A |
| | | | | | | | | | |
Alger Dynamic Opportunities Fund | | | | | | | | | |
Common Stocks | $ | 3,485,265 | | Market Approach | | Priced at Cost | | N/A | | N/A |
Preferred Stocks | | —* | | Income Approach | | Discount Rate | | 100.00% | | N/A |
Rights | | 74,404 | | Income Approach | | Discount Rate Probability of Success | | 9.06%-9.20% 0.00%-60.00% | | N/A |
Special Purpose Vehicle | | 1,754,439 | | Market Approach | | Transaction Price Revenue Multiple | | N/A 20.00x-22.00x | | N/A |
* Prosetta Biosciences, Inc., Series D shares are classified as a Level 3 investment and are fair valued at zero as of July 31, 2022.
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
The significant unobservable inputs used in the fair value measurement of each Fund’s securities are revenue and EBITDA multiples, discount rates, and the probability of success of certain outcomes. Significant increases and decreases in these inputs in isolation and interrelationships between these inputs would have resulted in significantly higher or lower fair value measurements than those noted in the table above. Generally, all other things being equal, increases in revenue and EBITDA multiples, decreases in discount rates, and increases in the probability of success result in higher fair value measurements, whereas decreases in revenues and EBITDA multiples, increases in discount rates, and decreases in the probability of success result in lower fair value measurements.
Certain of the Funds’ assets and liabilities are held at carrying amount or face value, which approximates fair value for financial reporting purposes. As of July 31, 2022, such assets were categorized within the ASC 820 disclosure hierarchy as follows:
| | TOTAL | | | LEVEL 1 | | | LEVEL 2 | | | LEVEL 3 | |
Cash, Foreign Cash and Cash Equivalents: | | | | | | | | | | | | | | | | |
Alger Spectra Fund | | $ | 998,907 | | | $ | 5 | | | $ | 998,902 | | | $ | — | |
Collateral held for short sales(a) | | | 60,427,437 | | | | 60,427,437 | | | | — | | | | — | |
Due to broker(b) | | | (142,168,141 | ) | | | (142,168,141 | ) | | | — | | | | — | |
Alger Dynamic Opportunities Fund | | | 74,206,727 | | | | 47 | | | | 74,206,680 | | | | — | |
Collateral held for short sales(a) | | | 259,164,763 | | | | 259,164,763 | | | | — | | | | — | |
Alger Emerging Markets Fund | | | 557,574 | | | | 322,747 | | | | 234,827 | | | | — | |
Alger Responsible Investing Fund | | | 264,557 | | | | — | | | | 264,557 | | | | — | |
| (a) | The collateral held for short sales balance represents restricted cash held at prime brokers as of July 31, 2022. |
| (b) | The due to broker balance represents a margin payable related to short sales due to prime brokers as of July 31, 2022. |
NOTE 4 — Derivatives:
FASB 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, the Funds may also buy and sell call and put options on equities and equity indexes. The Funds may also purchase call options to increase their exposure to the stock market and also provide diversification of risk. The Funds may also purchase put options in order to protect from significant market declines that may occur over a short period of time. The Funds may also 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 nine months ended July 31, 2022, options were used in accordance with these objectives.
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
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 clearinghouse that acts as an intermediary between buyer and seller, receiving initial and maintenance margin from both, and guaranteeing performance of the option contract. The purchased options included on the Schedule of Investments are exchange traded and not subject to offsetting.
Swaps — Swap agreements are two-party contracts entered into primarily by institutional investors for periods ranging from a few weeks to more than one year. In a standard “swap” transaction, two parties agree to exchange the returns (or differentials in rates of return) earned or realized on particular predetermined investments or instruments. The gross returns to be exchanged or “swapped” between the parties are generally calculated with respect to a “notional amount,” i.e., the return on or increase in value of a particular dollar amount invested at a particular interest rate, in a particular foreign currency, or in a “basket” of swaps or securities representing a particular index. The “notional amount” of the swap agreement is only used as a basis upon which to calculate the obligations that the parties to a swap agreement have agreed to exchange.
Contracts for Differences — The Funds may enter into Contracts for Differences (“CFDs”). CFDs are leveraged derivative instruments that allow a Fund to take a position on the change in the market price of an underlying asset, such as a stock, or the value of an index or currency exchange rate. With a short CFD, a Fund is seeking to profit from a decrease in the market price of the asset. CFDs are subject to liquidity risk because the liquidity of CFDs is based on the liquidity of the underlying instrument, and are subject to counterparty risk, i.e., the risk that the counterparty to the CFD transaction may be unable or unwilling to make payments or to otherwise honor its financial obligations under the terms of the contract. It is also possible that the market price of the CFD will move between the time the order is placed by a Fund and when it is executed by the issuer, which can result in the trade being executed at a less favorable price. CFDs, like many other derivative instruments, involve the risk that, if the derivative security declines in value, additional margin would be required to maintain the margin level. The seller may require a Fund to deposit additional sums to cover this decline in value, and the margin call may be made at short notice. If additional margin is not provided in time, the seller may liquidate the positions at a loss which a Fund is liable. The potential for margin calls and large losses are much greater in CFDs than in other leveraged products. Most CFDs are traded OTC. CFDs are not registered with the SEC or any U.S. regulator, and are not subject to U.S. regulation. A Fund will receive or pay an amount based upon the amount, if any, by which the notional amount of the CFD would have decreased or increased in value had it sold the particular stocks short, less the dividends that would have been paid on those stocks, plus a floating rate of interest on the notional amount of the CFD. All of these components are reflected in the market value of the CFD. The use of swap agreements is a highly specialized activity which involves strategies and risks different from those associated with ordinary portfolio security transactions. If Alger Management is incorrect in its forecasts of applicable market factors, or a counterparty defaults, the investment performance of the Fund would diminish compared with what it would have been if these techniques were not used. In addition, it is possible that developments in the swap market, including potential government regulation, could adversely affect the Fund’s ability to terminate existing swap agreements or to realize amounts to be received under such agreements.
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
NOTE 5 — Affiliated Securities:
During the nine-month period ended July 31, 2022, as disclosed in the following table, certain Funds held 5% or more of the outstanding voting securities of the issuers listed below. As such, these issuers were “affiliated persons” of the applicable Fund(s) for purposes of the 1940 Act. Transactions during the nine-month period ended July 31, 2022 with such affiliated persons are summarized below. During this period, other Funds in the Trust may also have held voting shares of the issuers at levels below 5%.
Security | | Shares Held at October 31, 2021 | | | Shares Purchased | | | Shares Sold | | | Shares Held at July 31, 2022 | | | Dividend Income | | | Realized Gain (Loss) | | | Net Change in Unrealized App(Dep) | | | Value at July 31, 2022 | |
Alger Spectra Fund | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Shake Shack, Inc., Cl. A** | | | 1,270,946 | | | | 2,263,630 | | | | (1,387,456 | ) | | | 2,147,120 | | | $ | — | | | $ | 641,499 | | | $ | (2,188,452 | ) | | $ | 110,490,795 | |
Preferred Stocks | | | | | | | | | | | | | | | | | �� | | | | | | | | | | | | | | | |
Prosetta Biosciences, Inc., Series D*** | | | 2,912,012 | | | | — | | | | — | | | | 2,912,012 | | | | — | | | | — | | | | — | | | | — | * |
Special Purpose Vehicle | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Crosslink Ventures Capital LLC, Cl. A | | | 294 | | | | — | | | | — | | | | 294 | | | | — | | | | — | | | | (3,096,702 | ) | | | 8,671,530 | |
Crosslink Ventures Capital LLC, Cl. B | | | 183 | | | | — | | | | — | | | | 183 | | | | — | | | | — | | | | (2,202,405 | ) | | | 5,515,986 | |
Total | | | | | | | | | | | | | | | | | | $ | — | | | $ | 641,499 | | | $ | (7,487,559 | ) | | $ | 124,678,311 | |
THE ALGER FUNDS II
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Security | | Shares Held at October 31, 2021 | | | Shares Purchased | | | Shares Sold | | | Shares Held at July 31, 2022 | | | Dividend Income | | | Realized Gain (Loss) | | | Net Change in Unrealized App(Dep) | | | Value at July 31, 2022 | |
Alger Dynamic | | | | | | | | | | | | | | | | | | | | | | | | |
Opportunities Fund | | | | | | | | | | | | | | | | | | | | | |
Preferred Stocks | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Prosetta Biosciences, Inc., Series D*** | | | 41,418 | | | | — | | | | — | | | | 41,418 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | * |
Special Purpose Vehicle | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Crosslink Ventures Capital LLC, Cl. A | | | 37 | | | | — | | | | — | | | | 37 | | | | — | | | | — | | | | (389,721 | ) | | | 1,091,315 | |
Crosslink Ventures Capital LLC, Cl. B | | | 22 | | | | — | | | | — | | | | 22 | | | | — | | | | — | | | | (264,770 | ) | | | 663,124 | |
Total | | | | | | | | | | | | | | | | | | $ | — | | | $ | — | | | $ | (654,491 | ) | | $ | 1,754,439 | |
* Prosetta Biosciences, Inc., Series D shares are classified as a Level 3 investment and are fair valued at zero as of July 31, 2022.
** Non-affiliated at October 31, 2021.
*** Prosetta Biosciences, Inc., Series D is deemed to be an affiliate of the Funds because the Funds and Prosetta Biosciences, Inc., Series D are under common control.
- 37 -