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: 811-08928
HSBC INVESTOR PORTFOLIOS
(Exact name of registrant as specified in charter)
452 FIFTH AVENUE
NEW YORK, NY 10018
(Address of principal executive offices) (Zip code)
CITI FUND SERVICES
3435 STELZER ROAD
COLUMBUS, OH 43219
(Name and address of agent for service)
Registrant’s telephone number, including area code: 1-800-782-8183
Date of fiscal year end: October 31
Date of reporting period: October 31, 2010
Item 1. Reports to Stockholders.
HSBC Global Asset Management (USA) Inc.
October 31, 2010
HSBC World Selection Funds
Annual Report
Aggressive Strategy Fund
Balanced Strategy Fund
Moderate Strategy Fund
Conservative Strategy Fund
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Table of Contents |
HSBC World Selection Funds
Annual Report - October 31, 2010
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HSBC Investor Portfolios |
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Barclays Capital U.S. Aggregate Bond Index is an unmanaged index generally representative of investment-grade fixed-rate debt issues, including government, corporate, asset-backed, and mortgage-backed securities, with maturities of at least one year.
Barclays Capital U.S. Corporate Bond Index is an unmanaged index includes publicly issued U.S. corporate and specified foreign debentures and secured notes that meet the specified maturity, liquidity, and quality requirements. To qualify, bonds must be SEC-registered.
Barclays Capital U.S. Corporate High-Yield Bond Index is an unmanaged index that covers the USD-denominated, non-investment grade, fixed-rate, taxable corporate bond market. Securities are classified as high-yield if the middle rating of Moody’s, Fitch, and S&P is Ba1/BB+/BB+ or below. The index excludes emerging markets debt.
Citigroup U.S. Domestic 3-Month U.S. Treasury Bill Index is an unmanaged index of three-month Treasury bills.
Merrill Lynch U.S. High Yield Master II Index is an unmanaged index which measures the performance of the broad high yield market.
MSCI EAFE Index (Europe, Australasia, Far East) is an unmanaged free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. & Canada. The MSCI EAFE Index currently consists of the following 22 developed market country indices: Australia, Austria, Belgium, Denmark, Finland, France, Germany, Greece, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland and the United Kingdom.
Russell Midcap® Index measures the performance of the mid-cap segment of the U.S. equity universe. The Russell Midcap® Index is a subset of the Russell 1000® Index. It includes approximately 800 of the smallest securities based on a combination of their market cap and current index membership. The Russell Midcap® Index represents approximately 31% of the total market capitalization of the Russell 1000 companies.
Russell 1000® Growth Index is an unmanaged index that measures the performance of the large-cap growth segment of the U.S. equity universe. It includes those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values.
Russell 1000® Value Index is an unmanaged index that measures the performance of the large-cap value segment of the U.S. equity universe. It includes those Russell 1000 companies with lower price-to-book ratios and lower expected growth values.
Russell 2000® Index is an unmanaged index which measures the performance of the small-cap segment of the U.S. equity universe. The Russell 2000 Index is a subset of the Russell 3000® Index representing approximately 8% of the total market capitalization of that index. It includes approximately 2000 of the smallest securities based on a combination of their market cap and current index membership.
Russell 2500™ Growth Index is an unmanaged index that measures the performance of the small- to mid-cap growth segment of the U.S. equity universe. It includes those Russell 2500 companies with higher price-to-book ratios and higher forecasted growth values.
Standard & Poor’s 500 Index (“S&P 500”) is an unmanaged index that is widely regarded as a gauge of the U.S. equities market, this index includes 500 leading companies in leading industries of the U.S. economy. The S&P 500 focuses on the large cap segment of the market, with approximately 75% coverage of U.S. equities.
Securities indices assume reinvestment of all distributions and interest payments and do not take in account brokerage fees or expenses. Securities in the Funds do not match those in the indices and performance of the Funds will differ. Investors cannot invest directly in an index.
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December 16, 2010
To Our Shareholders:
For the 12-month period ended October 31, 2010, equity and debt markets performed well, with returns of 16.52% for the S&P 500 Index1, 8.82% for the MSCI EAFE Index1, 26.58% for the Russell 2000 Index1 and 8.01% for the Barclays Capital U.S. Aggregate Bond Index1.
The period began with several encouraging economic indicators, which helped buoy investor sentiment. However, concerns about a “double-dip” recession in the U.S. increased, as did questions about the financial strength of certain countries in the European Union, such as Greece, whose debt was downgraded by credit rating agencies. The market declines associated with these concerns and events proved short-lived, though, and the markets strengthened late in the period. We are pleased that our funds also performed well during the 12 months under review. In the case of our money market funds, by far the largest asset class in our fund family, this performance comes despite the conservatism of our investment discipline—a discipline the investment adviser adopted ahead of Securities and Exchange Commission (“SEC”) mandated guidelines. These guidelines include, but are not limited to, daily and weekly portfolio liquidity requirements of 10% and 30%, respectively; portfolio quality limitations on second-tier securities; and a reduction in the overall weighted average maturity of money market funds.
These funds’ yields have been supported by significant fee waivers by the investment adviser and our other service providers, as shown in the chart below:
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Fund |
| Fees Waived |
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California Tax-Free Money Market Fund |
| $ | 327,580 |
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New York Tax-Free Money Market Fund |
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| 1,274,087 |
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Prime Money Market Fund |
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| 7,423,993 |
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Tax-Free Money Market Fund |
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| 438,252 |
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U.S. Government Money Market Fund |
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| 6,211,568 |
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U.S. Treasury Money Market Fund |
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| 6,910,492 |
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Such waivers have become common in the money market fund industry. A more detailed discussion of these fee waivers can be found in the footnotes that accompany the financial statements of the money market funds.
Overall, we are pleased with the performance of the equity funds. The HSBC Investor International Equity Fund has, however, lagged its benchmark for 1-, 3- and 5- year periods. In December 2010, the Board approved a change in sub-advisor for this fund; Lord Abbett & Co. was hired as the new sub-adviser to the fund, effective January 2010. Shareholders of this fund will receive more information about this change in the future.
The Board and the investment adviser continue to pursue appropriate expansion and positioning of the fund family. HSBC has a long history of operating and investing in emerging markets, and the possibility of offering U.S. investors funds that capitalize on that experience and expertise is intriguing. While it is increasingly difficult to find asset classes that provide real diversification (investment professionals describe this as “narrowing correlation coefficients”), at this time emerging markets appear to offer such diversification. Emerging markets are widely favored by the pundits at this time. They cite valuations that are attractive by historic measures, rising capital inflows (though they remain below prior highs) and “QEII”—the Fed’s second round of monetary easing, which some observers feel is likely to further boost such investment inflows, thereby increasing these valuations. Some concern remains about these markets’ abilities to absorb these inflows. We look forward to providing you with more information on this topic at the appropriate time in the future.
QEII, the Federal Reserve’s $600 billion program to buy long-term Treasuries over the next three quarters, is both controversial and problematic when banks are highly liquid and lending is trivial. At best, I believe that the program might stimulate U.S. Gross Domestic Product (“GDP”)1 growth by 0.5%—a paltry increment that comes at high cost given the twin deficits. So, we think it best to view this effort as effectively another effort to lift the value of risk assets and to recapitalize the banks, which may borrow from the Fed at 0.25% and buy Treasuries yielding 3% or more.
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1 | HSBC INVESTOR FAMILY OF FUNDS |
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Chairman’s Message (continued) |
At year end, the Board accepted with great regret the resignation of long-time independent chair Dr. Larry Robbins, a founding trustee of the predecessor fund family almost 25 years ago. We are delighted that Larry agreed to serve as trustee emeritus for a year, so his warmth and insight will still be available to us.
Finally, we note that Andrew Donohue stepped down as Director of the Division of Investment Management of the Securities and Exchange Commission effective November 19, 2010. “Buddy”, as he’s better known to his many friends in the fund industry, was a superb regulator—tough-minded but fair, creative, and single-minded in serving the needs of American investors. We all recall fondly his visit to a Board dinner—an outreach practice he followed throughout his SEC tenure and one that other government figures would do well to emulate.
This is my second letter as chairman to our shareholders. In drafting both reports, I’ve thought of how Charles Dickens began his novel about the French Revolution, A Tale of Two Cities: “It was the best of times, it was the worst of times...” So, too, might any money manager opine of any moment. Today, there are deep global economic imbalances—between east and west, north and south. And within our most advanced economies a growing gap prevails between governments’ promises and their ability to honor those promises. This challenge comes at a time of discouraging demographics in the OECD countries. We believe this challenge confers a special responsibility to provide the best possible risk-adjusted performance to those investors who entrust us with their capital.
I can assure you that my colleagues and I, as well as the investment adviser and other service providers, take this duty very seriously and pledge our very best effort to that good end.
Cordially,
Michael Seely
Chairman, HSBC Investor Funds
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1 | For additional information, please refer to the Glossary of Terms. |
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HSBC INVESTOR FAMILY OF FUNDS | 2 |
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Dear Shareholder,
Welcome to the HSBC Investor Funds annual report, covering the period between November 1, 2009 and October 31, 2010. This report offers detailed information about your Funds’ results. We encourage you to review it carefully.
Inside these pages you will find a letter from the Funds’ Chairman, Michael Seely, in which he comments on recent market developments. As always, the report includes the financial statements covering the fiscal year for each of the funds. The report also includes commentary from the Funds’ portfolio managers in which they discuss the investment markets during the period and their respective Fund’s performance. Each commentary is accompanied by the Fund’s return for the period, listed alongside the returns of its benchmark index and peer group average for comparative purposes.
The near-zero short-term rate environment has persisted throughout the Funds’ fiscal year and is likely to continue for some time. In response, HSBC has continued to waive a portion of its advisory and shareholder servicing fees from the various money market funds in order to maintain a positive yield for the Funds’ shareholders.
Our Multimanager team continues to review and monitor the subadvisors that manage the Equity Funds. The team also reviews and monitors the third party funds in which the World Selection Funds invest. We believe that this level of review and oversight helps to provide the Funds’ shareholders with significant benefits, including competitive performance.
In closing, we would like to thank you for investing through the HSBC Investor Funds. We appreciate the trust you place in us, and will continue working to earn it. Please contact us at any time with questions or concerns.
Sincerely,
Richard A. Fabietti
President
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3 | HSBC INVESTOR FAMILY OF FUNDS |
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HSBC Global Asset Management (USA) Inc. |
U.S. Economic Review
The 12-month period between November 1, 2009 and October 31, 2010 began with continued global macroeconomic improvements. Central banks around the developed world fueled the recovery by maintaining interest rates at record lows, and governments provided stimulus programs to spark growth. In the U.S., the Federal Reserve positioned the federal funds rate—a key factor in lending rates—at a historically low target range between 0.00% to 0.25%, and maintained its quantitative easing program throughout the 12-month period.
Early in the period, several encouraging U.S. economic indicators, including positive manufacturing data and improving consumer spending levels, suggested the rebound was gaining strength. However, as the year progressed, signs emerged that the U.S. economic recovery was losing momentum. For example, the index of leading indicators in April 2010 was worse than expected, falling for the first time since March 2009. Although this period of moderation continued, several economic indicators appeared to stabilize as the period wore on, reducing fears of a “double-dip” recession. Nevertheless, there are still some areas of concern—including high U.S. unemployment figures—and forecasts now point towards a slower recovery than was anticipated at the beginning of the period.
Meanwhile, the year was regularly punctuated by periods of volatility due to sovereign debt issues in the Eurozone. This was most apparent in April when credit rating downgrades of Greece and other peripheral Eurozone countries caused bond yields in those countries to rocket upwards. In response to the deterioration of the debt situation, the International Monetary Fund (IMF) and the European Central Bank (ECB) stepped in. They agreed to a $1 trillion package, providing loan guarantees and credits, not just to Greece but to all Eurozone states in financial difficulty, restoring a measure of comfort to investors. More recently, however, debt concerns have resurfaced and the fiscal situation of countries throughout the developed world, including the U.S., continue to cause concern.
Market Review
The financial markets rallied during the first half of the period driven by positive earnings surprises, attractive valuations and ample liquidity. Investors in this environment were more comfortable with higher-risk areas of the markets, helping emerging markets and small-cap stocks produce strong gains during the six months through April.
The fiscal troubles in the Eurozone largely halted the rally in international stocks. Investors became more risk averse in this environment, which in turn pushed down equity markets around the world. In May 2010, developed markets declined by an average of 9%, while emerging markets fell by roughly 8%. However, thanks to a financial support facility from the ECB and IMF, these declines generally were short-lived. Emerging markets stocks staged a particularly strong rebound, driven by strong macroeconomic data and performed well for the period as a whole. Developed market international stocks did not perform as well for the fiscal year, in large part because of the impact of the Eurozone’s sovereign debt issues. The MSCI EAFE Index1 (Europe, Australasia and Far East) of international stocks returned 8.82%, in U.S. Dollar terms, for the 12-month period.
Domestic stocks experienced much stronger returns than their counterparts in developed foreign markets. The S&P 500 Index1 of large-company stocks returned 16.52% for the 12 months through October 2010. Small-cap and mid-cap stocks were among the period’s strongest performers: The Russell 2000® Index1 of small-company stocks returned 26.58%, and the Russell Midcap® Index1 returned 27.71%. The small- and mid-cap categories especially benefited early in the period, due to the early strength and breadth of the U.S. economic recovery and strong corporate earnings results.
Within fixed income, the performance of U.S. Treasuries was mixed over the period. Initially, the pursuit of higher yielding assets led to lower demand for government bonds. As the period progressed, investors responded to increased market volatility by returning to the relative safety of U.S. government bonds, improving their performance. Still, Treasuries lagged the rest of the fixed-income market for the 12 months as a whole. Investment grade corporate bonds and high-yield bonds benefited from attractive valuation levels and a strong improvement in corporate earnings and microeconomic conditions.
The Barclays Capital U.S. Corporate Bond Index1, which tracks the broad investment-grade fixed-income market, returned 11.61% for the 12 months through October, while the Barclays Capital U.S. Corporate High-Yield Bond Index1 returned 19.35%.
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1 | For additional information, please refer to the Glossary of Terms. |
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HSBC INVESTOR FAMILY OF FUNDS | 4 |
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Aggressive Strategy Fund |
Balanced Strategy Fund |
Moderate Strategy Fund |
Conservative Strategy Fund |
Investment Concerns
Allocation Risk: The risks that the Adviser’s target asset and sector allocations and changes in target asset and sector allocations cause a Fund to underperform other similar funds or cause you to lose money, and that a Fund may not achieve its target asset and sector allocations.
Underlying Fund Selection Risk: The risk that a Fund may invest in Underlying Funds that underperform other similar funds or the markets more generally, due to poor investment decisions by the investment adviser(s) for the Underlying Funds or otherwise. Underlying funds also have their own expenses, which the Funds bear in addition to their own expenses.
Equity Securities Risk: A portion of the assets of a Fund is allocated to Underlying Funds investing primarily in equity securities. Therefore, the value of the Fund may increase or decrease as a result of its indirect interest in equity securities.
Fixed Income Securities Risk: A portion of the assets of a Fund is allocated to Underlying Funds investing primarily in fixed-income securities. Therefore, the value of the Fund may increase or decrease as a result of its indirect interest in fixed-income securities.
Foreign Securities/Emerging Markets Risk: Foreign securities, including those of emerging market issuers, are subject to additional risks including international trade, currency, political, and regulatory risks. Securities of emerging market issuers generally have more risk than securities issued by issuers in more developed foreign markets.
Market Commentary
The HSBC Investor World Selection Funds (“Funds”) generated the following returns during the 12-month period between November 1, 2009 and October 31, 2010:
Aggressive Strategy Fund: 12.01%
Balanced Strategy Fund: 11.95%
Moderate Strategy Fund: 10.69%
Conservative Strategy Fund: 8.14%
The Funds’ benchmark/reference indices posted the following performance:
S&P 500 Index1: 16.52%
MSCI EAFE Index1: 8.82%
Barclays Capital U.S. Aggregate Bond Index1: 8.01%
Citigroup U.S. Domestic 3-Month T-Bill Index1: 0.12%
The structure of the Funds changed during the period under review. We broadened their asset mix significantly: At the beginning of the period, the four Funds, formerly known as the Lifeline Funds, offered exposure to a limited set of asset classes, including large- and small-cap U.S. stocks, international stocks, fixed-income and short-term assets. As of January 19, 2010, we expanded the categories of asset classes used in each Fund to include enhancements such as emerging markets equity and debt, commodities and private equity. Our goal was to augment diversification and thereby improve the potential return each Fund offers at a given level of expected volatility.*
The Funds were aided by from a strong environment in the financial markets during the 12 months through October 31, 2010. The S&P 500 Index of large-company stocks rose 16.52% as equity prices responded to an improving economic environment and a strong recovery in corporate earnings. The Funds gained from their exposure to the fixed-income markets, which performed well during the period. In particular, the strong performance of high-yield bonds benefited the Funds during the period.*
The Funds’ benefited from overweight positions relative to their neutral weightings in small- and mid-cap U.S. equities and Latin American stocks. The Balanced Strategy and Aggressive Strategy Funds, which have sizable allocations to U.S. equities, especially benefited from those tactics.
Turning to the underlying manager selections within specific asset classes, strong selections in the small- and mid-cap U.S. equity market boosted the performance of the Funds’ core equity positions, as did manager selections within the Latin American equity market.*
The fixed-income portions of the Funds benefited from strong manager selection among emerging markets debt securities. However, selection among U.S. high-yield bonds dragged on relative performance during the period.*
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1 | For additional information, please refer to the Glossary of Terms. |
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* | Portfolio composition is subject to change. |
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5 | HSBC INVESTOR FAMILY OF FUNDS |
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Portfolio Reviews |
Aggressive Strategy Fund |
Value of a $10,000 Investment |
The chart above represents a comparison of a hypothetical $10,000 investment in the indicated Fund versus a similar investment in the Fund’s benchmarks and represents the reinvestment of dividends and capital gains in the Fund.
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Fund Performance |
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| Average Annual |
| Expense |
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As of October 31, 2010 |
| Inception |
| 1 |
| 5 |
| Since |
| Gross |
| Net |
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Aggressive Strategy Fund Class A1 |
| 2/14/05 |
| 12.01 |
| 2.91 |
| 3.60 |
| 2.16 |
| 1.50 |
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Aggressive Strategy Fund Class B2 |
| 2/9/05 |
| 13.04 |
| 3.20 |
| 3.79 |
| 2.91 |
| 2.25 |
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Aggressive Strategy Fund Class C3 |
| 6/10/05 |
| 16.06 |
| 3.22 |
| 4.01 |
| 2.91 |
| 2.25 |
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S&P 500 Index6 |
| — |
| 16.52 |
| 1.73 |
| 2.14 | 7 | N/A |
| N/A |
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MSCI EAFE Index6 |
| — |
| 8.82 |
| 3.79 |
| 4.72 | 7 | N/A |
| N/A |
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Barclays Capital U.S. Aggregate Bond Index6 |
| — |
| 8.01 |
| 6.45 |
| 5.59 | 7 | N/A |
| N/A |
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Citigroup U.S. Domestic 3-Month Treasury Bill Index6 |
| — |
| 0.12 |
| 2.42 |
| 2.49 | 7 | N/A |
| N/A |
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Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect the taxes that a shareholder would pay on Fund distributions or on the redemption of Fund shares. The investment return and principal value will fluctuate so that an investor’s shares, when redeemed may be worth more or less than the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.
The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower. Currently, contractual fee waivers are in effect from March 1, 2010 through March 1, 2011.
During the periods ended October 31, 2008, 2009 and 2010, one or more Underlying Funds in which the Fund invests in, received monies related to certain nonrecurring litigation settlements. Without the receipt of these payments, the returns for the applicable periods would be lower.
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1 | Reflects the maximum sales charge of 5.00%. |
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2 | Reflects the applicable contingent deferred sales charge, maximum of 4.00%. |
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3 | Reflects the applicable contingent deferred sales charge, maximum of 1.00%. |
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4 | Reflects the expense ratio as reported in the prospectus dated March 31, 2010. |
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5 | For additional information, please refer to the Glossary of Terms. |
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6 | Effective January 19, 2010 the Fund no longer compares its performance to that of the LifeLine Aggressive Growth Blended Portfolio Index due to a change to the Fund’s investment strategy. The Fund’s performance is now compared to broader-based market indices. The LifeLine Aggressive Growth Blended Portfolio Index consisted of a blend by a percentage of the following indices: Citigroup U.S. Domestic 3-Month Treasury Bill Index5 (1%); Russell 1000® Growth Index5 (21%); Russell 1000® Value Index5 (21%); Russell 2500TM Growth Index5 (34%) and the MSCI EAFE Index5 (23%). These indices are unmanaged and do not reflect the fees and expenses associated with a mutual fund, and investors cannot directly invest in an index. |
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7 | Return for the period 2/9/05 to 10/31/10. |
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| HSBC INVESTOR FAMILY OF FUNDS | 6 |
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Portfolio Reviews |
Balanced Strategy Fund |
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Value of a $10,000 Investment |
The chart above represents a comparison of a hypothetical $10,000 investment in the indicated Fund versus a similar investment in the Fund’s benchmarks and represents the reinvestment of dividends and capital gains in the Fund.
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Fund Performance |
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| Average Annual |
| Expense |
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As of October 31, 2010 |
| Inception |
| 1 |
| 5 |
| Since |
| Gross |
| Net |
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Balanced Strategy Fund Class A1 |
| 2/8/05 |
| 11.95 |
| 3.34 |
| 4.16 |
| 1.60 |
| 1.60 |
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Balanced Strategy Fund Class B2 |
| 2/1/05 |
| 13.01 |
| 3.63 |
| 4.51 |
| 2.35 |
| 2.35 |
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Balanced Strategy Fund Class C3 |
| 4/27/05 |
| 15.96 |
| 3.64 |
| 4.78 |
| 2.35 |
| 2.35 |
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S&P 500 Index6 |
| — |
| 16.52 |
| 1.73 |
| 2.13 | 7 | N/A |
| N/A |
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MSCI EAFE Index6 |
| — |
| 8.82 |
| 3.79 |
| 4.68 | 7 | N/A |
| N/A |
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Barclays Capital U.S. Aggregate Bond Index6 |
| — |
| 8.01 |
| 6.45 |
| 5.66 | 7 | N/A |
| N/A |
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Citigroup U.S. Domestic 3-Month Treasury Bill Index6 |
| — |
| 0.12 |
| 2.42 |
| 2.49 | 7 | N/A |
| N/A |
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Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect the taxes that a shareholder would pay on Fund distributions or on the redemption of Fund shares. The investment return and principal value will fluctuate so that an investor’s shares, when redeemed may be worth more or less than the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.
The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower.
During the periods ended October 31, 2007, 2008, 2009 and 2010, one or more Underlying Funds in which the Fund invests in, received monies related to certain nonrecurring litigation settlements. Without the receipt of these payments, the returns for the applicable periods would be lower.
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1 | Reflects the maximum sales charge of 5.00%. |
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2 | Reflects the applicable contingent deferred sales charge, maximum of 4.00%. |
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3 | Reflects the applicable contingent deferred sales charge, maximum of 1.00%. |
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4 | Reflects the expense ratio as reported in the prospectus dated March 31, 2010. |
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5 | For additional information, please refer to the Glossary of Terms. |
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6 | Effective January 19, 2010 the Fund no longer compares its performance to that of the LifeLine Growth Blended Portfolio Index due to a change to the Fund’s investment strategy. The Fund’s performance is now compared to broader-based market indices. The LifeLine Growth Blended Portfolio Index consisted of a blend by a percentage of the following indices: Citigroup U.S. Domestic 3-Month Treasury Bill Index5 (1%); Citigroup U.S. High Yield Market Capped Index5 (2%); Barclays Capital U.S. Aggregate Bond Index5 (15%); Russell 1000® Growth Index5 (21%); Russell 1000® Value Index5 (21%); Russell 2500TM Growth Index5 (20%), and the MSCI EAFE Index5 (20%). These indices are unmanaged and do not reflect the fees and expenses associated with a mutual fund, and investors cannot directly invest in an index. |
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7 | Return for the period 2/1/05 to 10/31/10. |
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7 | HSBC INVESTOR FAMILY OF FUNDS |
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Portfolio Reviews |
Moderate Strategy Fund |
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Value of a $10,000 Investment |
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The chart above represents a comparison of a hypothetical $10,000 investment in the indicated Fund versus a similar investment in the Fund’s benchmarks and represents the reinvestment of dividends and capital gains in the Fund.
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Fund Performance |
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| Average Annual |
| Expense |
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As of October 31, 2010 |
| Inception |
| 1 |
| 5 |
| Since |
| Gross |
| Net |
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Moderate Strategy Fund Class A1 |
| 2/3/05 |
| 10.69 |
| 3.53 |
| 3.93 |
| 1.58 |
| 1.58 |
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Moderate Strategy Fund Class B2 |
| 2/1/05 |
| 11.61 |
| 3.80 |
| 4.18 |
| 2.33 |
| 2.33 |
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Moderate Strategy Fund Class C3 |
| 6/10/05 |
| 14.55 |
| 3.80 |
| 4.05 |
| 2.33 |
| 2.33 |
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S&P 500 Index6 |
| — |
| 16.52 |
| 1.73 |
| 2.13 | 7 | N/A |
| N/A |
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MSCI EAFE Index6 |
| — |
| 8.82 |
| 3.79 |
| 4.68 | 7 | N/A |
| N/A |
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Barclays Capital U.S. Aggregate Bond Index6 |
| — |
| 8.01 |
| 6.45 |
| 5.66 | 7 | N/A |
| N/A |
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Citigroup U.S. Domestic 3-Month Treasury Bill Index6 |
| — |
| 0.12 |
| 2.42 |
| 2.49 | 7 | N/A |
| N/A |
|
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect the taxes that a shareholder would pay on Fund distributions or on the redemption of Fund shares. The investment return and principal value will fluctuate so that an investor’s shares, when redeemed may be worth more or less than the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.
The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower.
During the periods ended October 31, 2007, 2008, 2009 and 2010, one or more Underlying Funds in which the Fund invests in, received monies related to certain nonrecurring litigation settlements. Without the receipt of these payments, the returns for the applicable periods would be lower.
|
|
1 | Reflects the maximum sales charge of 5.00%. |
|
|
2 | Reflects the applicable contingent deferred sales charge, maximum of 4.00%. |
|
|
3 | Reflects the applicable contingent deferred sales charge, maximum of 1.00%. |
|
|
4 | Reflects the expense ratio as reported in the prospectus dated March 31, 2010. |
|
|
5 | For additional information, please refer to Glossary of Terms. |
|
|
6 | Effective January 19, 2010 the Fund no longer compares its performance to that of the LifeLine Moderate Growth Blended Portfolio Index due to a change to the Fund’s investment strategy. The Fund’s performance is now compared to broader-based market indices. The LifeLine Moderate Growth Blended Portfolio Index consisted of a blend by a percentage of the following indices: Citigroup U.S. Domestic 3-Month Treasury Bill Index5 (6%); Barclays Capital U.S. Aggregate Bond Index5 (26%); Citigroup U.S. High Yield Market Capped Index5 (5%); Russell 1000® Growth Index5 (19%); Russell 1000® Value Index5 (18%); Russell 2500TM Growth Index5 (11%) and the MSCI EAFE Index5 (15%). |
|
|
7 | Return for the period 2/1/05 to 10/31/10. |
|
|
|
| HSBC INVESTOR FAMILY OF FUNDS | 8 |
|
Portfolio Reviews |
Conservative Strategy Fund |
|
Value of a $10,000 Investment |
The chart above represents a comparison of a hypothetical $10,000 investment in the indicated Fund versus a similar investment in the Fund’s benchmarks and represents the reinvestment of dividends and capital gains in the Fund.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fund Performance |
|
|
| Average Annual |
| Expense |
| ||||||
As of October 31, 2010 |
| Inception |
| 1 |
| 5 |
| Since |
| Gross |
| Net |
|
Conservative Strategy Fund Class A1 |
| 2/23/05 |
| 8.14 |
| 3.43 |
| 3.53 |
| 1.79 |
| 1.79 |
|
Conservative Strategy Fund Class B2 |
| 2/17/05 |
| 8.94 |
| 3.73 |
| 3.61 |
| 2.54 |
| 2.54 |
|
Conservative Strategy Fund Class C3 |
| 4/19/05 |
| 12.07 |
| 3.83 |
| 4.21 |
| 2.54 |
| 2.54 |
|
S&P 500 Index6 |
| — |
| 16.52 |
| 1.73 |
| 2.15 | 7 | N/A |
| N/A |
|
MSCI EAFE Index6 |
| — |
| 8.82 |
| 3.79 |
| 4.26 | 7 | N/A |
| N/A |
|
Barclays Capital U.S. Aggregate Bond Index6 |
| — |
| 8.01 |
| 6.45 |
| 5.69 | 7 | N/A |
| N/A |
|
Citigroup U.S. Domestic 3-Month Treasury Bill Index6 |
| — |
| 0.12 |
| 2.42 |
| 2.51 | 7 | N/A |
| N/A |
|
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and do not reflect the taxes that a shareholder would pay on Fund distributions or on the redemption of Fund shares. The investment return and principal value will fluctuate so that an investor’s shares, when redeemed may be worth more or less than the original cost. To obtain performance information current to the most recent month end, please call 1-800-782-8183.
The performance above reflects any fee waivers that have been in effect during the applicable periods, as well as any expense reimbursements that have periodically been made. Absent such waivers and reimbursements, returns would have been lower.
During the periods ended October 31, 2007, 2008, 2009 and 2010, one or more Underlying Funds in which the Fund invests in, received monies related to certain nonrecurring litigation settlements. Without the receipt of these payments, the returns for the applicable periods would be lower.
|
|
1 | Reflects the maximum sales charge of 5.00%. |
|
|
2 | Reflects the applicable contingent deferred sales charge, maximum of 4.00%. |
|
|
3 | Reflects the applicable contingent deferred sales charge, maximum of 1.00%. |
|
|
4 | Reflects the expense ratio as reported in the prospectus dated March 31, 2010. |
|
|
5 | For additional information, please refer to the Glossary of Terms. |
|
|
6 | Effective January 19, 2010 the Fund no longer compares its performance to that of the LifeLine Conservative Growth Blended Portfolio Index due to a change to the Fund’s investment strategy. The Fund’s performance is now compared to broader-based market indices. The LifeLine Conservative Growth Blended Portfolio Index consisted of a blend by a percentage of the following indices: Citigroup U.S. Domestic 3-Month Treasury Bill Index5 (21%); Citigroup U.S. High Yield Market Capped Index5 (8%); Barclays Capital U.S. Aggregate Bond Index5 (25%); Barclays Capital Intermediate U.S. Aggregate Bond Index5 (3%); Russell 1000® Growth Index5 (15%); Russell 1000® Value Index5 (14%); Russell 2500TM Growth Index5 (4%) and the MSCI EAFE Index5 (10%). |
|
|
7 | Return for the period 2/17/05 to 10/31/10. |
|
|
|
9 | HSBC INVESTOR FAMILY OF FUNDS |
|
|
Portfolio Reviews |
Portfolio Composition* |
October 31, 2010 |
(Unaudited) |
|
|
|
|
|
HSBC Aggressive Strategy Portfolio |
|
|
|
|
|
|
|
| |
Investment Allocation |
| Percentage of Investments at Value |
| |
Affiliated Investment Companies |
| 59.5 | % |
|
Unaffiliated Investment Companies |
| 24.7 | % |
|
Exchange Traded Funds |
| 9.0 | % |
|
Affiliated Portfolios |
| 6.8 | % |
|
Total |
| 100.0 | % |
|
|
|
|
|
|
HSBC Balance Strategy Portfolio |
|
|
|
|
|
|
|
|
|
Investment Allocation |
| Percentage of Investments at Value |
| |
Affiliated Investment Companies |
| 41.7 | % |
|
Unaffiliated Investment Companies |
| 40.3 | % |
|
Exchange Traded Funds |
| 12.8 | % |
|
Affiliated Portfolios |
| 5.2 | % |
|
Total |
| 100.0 | % |
|
|
|
|
|
|
HSBC Moderate Strategy Portfolio |
|
|
|
|
|
|
|
|
|
Investment Allocation |
| Percentage of Investments at Value |
| |
Unaffiliated Investment Companies |
| 46.9 | % |
|
Affiliated Investment Companies |
| 29.9 | % |
|
Exchange Traded Funds |
| 19.2 | % |
|
Affiliated Portfolios |
| 3.9 | % |
|
Total |
| 100.0 | % |
|
|
|
|
|
|
HSBC Conservation Strategy Portfolio |
|
|
|
|
|
|
|
| |
Investment Allocation |
| Percentage of Investments at Value |
| |
Unaffiliated Investment Companies |
| 48.4 | % |
|
Exchange Traded Funds |
| 27.7 | % |
|
Affiliated Investment Companies |
| 20.8 | % |
|
Affiliated Portfolios |
| 3.1 | % |
|
Total |
| 100.0 | % |
|
|
|
|
|
|
HSBC Investor Growth Portfolio |
|
|
|
|
|
|
|
|
|
Investment Allocation |
| Percentage of Investments at Value |
| |
Computers & Peripherals |
| 8.6 | % |
|
Software |
| 7.1 | % |
|
IT Services |
| 6.9 | % |
|
Internet & Catalog Retail |
| 6.5 | % |
|
Machinery |
| 6.0 | % |
|
Communications Equipment |
| 5.8 | % |
|
Capital Markets |
| 5.4 | % |
|
Internet Software & Services |
| 4.8 | % |
|
Energy Equipment & Services |
| 4.2 | % |
|
Diversified Financial Services |
| 3.5 | % |
|
Road & Rail |
| 3.1 | % |
|
Aerospace & Defense |
| 2.9 | % |
|
Pharmaceuticals |
| 2.9 | % |
|
Metals & Mining |
| 2.8 | % |
|
Health Care Providers & Services |
| 2.8 | % |
|
Specialty Retail |
| 2.3 | % |
|
Hotels, Restaurants & Leisure |
| 2.2 | % |
|
Oil, Gas & Consumable Fuels |
| 2.0 | % |
|
Electronic Equipment, Instruments & Components |
| 2.0 | % |
|
Wireless Telecommunication Services |
| 1.8 | % |
|
Multiline Retail |
| 1.5 | % |
|
Construction & Engineering |
| 1.4 | % |
|
Investment Companies |
| 1.3 | % |
|
Air Freight & Logistics |
| 1.2 | % |
|
Semiconductors & Semiconductor Equipment |
| 1.1 | % |
|
Health Care Technology |
| 1.1 | % |
|
Personal Products |
| 1.1 | % |
|
Biotechnology |
| 1.1 | % |
|
Beverages |
| 1.0 | % |
|
Food & Staples Retailing |
| 1.0 | % |
|
Textiles, Apparel & Luxury Goods |
| 1.0 | % |
|
Chemicals |
| 0.9 | % |
|
Food Products |
| 0.9 | % |
|
Health Care Equipment & Supplies |
| 0.8 | % |
|
Auto Components |
| 0.5 | % |
|
Media |
| 0.5 | % |
|
Total |
| 100.0 | % |
|
|
|
|
|
|
HSBC International Equity Portfolio |
|
|
|
|
|
|
|
|
|
Investment Allocation |
| Percentage of Investments at Value |
| |
Europe |
| 61.2 | % |
|
Japan |
| 23.6 | % |
|
Australia & Far East |
| 8.0 | % |
|
Canada |
| 4.9 | % |
|
Other |
| 1.3 | % |
|
Cash |
| 1.0 | % |
|
Total |
| 100.0 | % |
|
|
|
HSBC INVESTOR FAMILY OF FUNDS | 10 |
|
Portfolio Reviews |
Portfolio Composition* |
October 31, 2010 |
(Unaudited) |
|
|
|
|
|
HSBC Investor Opportunity Portfolio |
|
|
|
|
|
|
|
|
|
Investment Allocation |
| Percentage of Investments at Value |
| |
Oil, Gas & Consumable Fuels |
| 9.2 | % |
|
Semiconductors & Semiconductor Equipment |
| 6.7 | % |
|
Software |
| 6.0 | % |
|
Machinery |
| 5.1 | % |
|
Hotels, Restaurants & Leisure |
| 4.7 | % |
|
Life Sciences Tools & Services |
| 4.5 | % |
|
Health Care Equipment & Supplies |
| 3.7 | % |
|
Auto Components |
| 3.4 | % |
|
Specialty Retail |
| 3.3 | % |
|
Health Care Providers & Services |
| 3.2 | % |
|
Food Products |
| 3.1 | % |
|
Commercial Services & Supplies |
| 3.0 | % |
|
Biotechnology |
| 2.9 | % |
|
Investment Companies |
| 2.9 | % |
|
Pharmaceuticals |
| 2.5 | % |
|
Media |
| 2.5 | % |
|
Containers & Packaging |
| 2.3 | % |
|
Chemicals |
| 2.3 | % |
|
Aerospace & Defense |
| 2.2 | % |
|
Internet Software & Services |
| 2.1 | % |
|
Wireless Telecommunication Services |
| 2.1 | % |
|
Textiles, Apparel & Luxury Goods |
| 2.1 | % |
|
Electrical Equipment |
| 2.1 | % |
|
Metals & Mining |
| 2.0 | % |
|
Communications Equipment |
| 2.0 | % |
|
Real Estate Investment Trusts (REITs) |
| 1.8 | % |
|
Capital Markets |
| 1.8 | % |
|
Road & Rail |
| 1.7 | % |
|
IT Services |
| 1.6 | % |
|
Diversified Financial Services |
| 1.6 | % |
|
Household Products |
| 1.5 | % |
|
Trading Companies & Distributors |
| 1.4 | % |
|
Energy Equipment & Services |
| 1.3 | % |
|
Commercial Banks |
| 1.0 | % |
|
Diversified Consumer Services |
| 0.4 | % |
|
Total |
| 100.0 | % |
|
|
|
|
|
|
HSBC Investor Value Portfolio |
|
|
|
|
|
|
|
|
|
Electrical Equipment |
| Percentage of Investments at Value |
| |
Insurance |
| 16.7 | % |
|
Oil, Gas & Consumable Fuels |
| 13.0 | % |
|
Pharmaceuticals |
| 8.5 | % |
|
Metals & Mining |
| 8.1 | % |
|
Software |
| 7.1 | % |
|
Investment Companies |
| 6.5 | % |
|
Media |
| 6.1 | % |
|
Communications Equipment |
| 4.7 | % |
|
Biotechnology |
| 4.3 | % |
|
Diversified Financial Services |
| 3.8 | % |
|
Aerospace & Defense |
| 3.7 | % |
|
Commercial Banks |
| 2.1 | % |
|
Food & Staples Retailing |
| 2.1 | % |
|
Tobacco |
| 2.0 | % |
|
Machinery |
| 1.8 | % |
|
Road & Rail |
| 1.7 | % |
|
Commercial Services & Supplies |
| 1.7 | % |
|
Household Products |
| 1.3 | % |
|
Energy Equipment & Services |
| 1.3 | % |
|
Independent Power Producers & Energy Traders |
| 1.3 | % |
|
Health Care Providers & Services |
| 1.2 | % |
|
Capital Markets |
| 1.0 | % |
|
Total |
| 100.0 | % |
|
|
|
* | Portfolio composition is subject to change. |
|
|
11 | HSBC INVESTOR FAMILY OF FUNDS |
|
AGGRESSIVE STRATEGY FUND |
|
|
|
|
|
|
|
|
Affiliated Investment Companies—6.8% | |||||||
|
|
|
|
|
| ||
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
HSBC Investor Mid-Cap Fund, |
|
| 106,123 |
|
| 775,762 |
|
HSBC Investor Prime Money Market |
|
| 179,698 |
|
| 179,698 |
|
|
|
|
|
|
| ||
TOTAL AFFILIATED |
|
|
|
|
| 955,460 |
|
|
|
|
|
|
| ||
| |||||||
Affiliated Portfolios—59.2% |
|
|
|
|
|
|
|
HSBC Investor Growth Portfolio |
|
| 2,248,339 |
|
| 3,189,999 |
|
HSBC Investor International Equity |
|
| 524,932 |
|
| 1,252,112 |
|
HSBC Investor Opportunity Portfolio |
|
| 215,784 |
|
| 788,085 |
|
HSBC Investor Value Portfolio |
|
| 2,314,315 |
|
| 3,124,626 |
|
|
|
|
|
|
| ||
TOTAL AFFILIATED |
|
|
|
|
| 8,354,822 |
|
|
|
|
|
|
| ||
| |||||||
Unaffiliated Investment Companies—26.4% |
|
|
|
|
|
|
|
BlackRock Latin America Fund, Inc., |
|
| 2,291 |
|
| 172,654 |
|
Cohen & Steers Institutional Global |
|
| 876 |
|
| 18,487 |
|
Delaware Emerging Markets Fund, |
|
| 43,150 |
|
| 663,222 |
|
EII Global Property Fund, |
|
| 1,255 |
|
| 18,527 |
|
Goldman Sachs Emerging Markets |
|
| 6,066 |
|
| 79,287 |
|
Goldman Sachs High Yield Fund, |
|
| 88,883 |
|
| 649,721 |
|
JPMorgan High Yield Fund, |
|
| 79,809 |
|
| 655,235 |
|
Lord Abbett Core Fixed Income Fund, |
|
| 10,861 |
|
| 124,895 |
|
Metropolitan West Total Return |
|
| 12,079 |
|
| 129,764 |
|
PIMCO Commodity RealReturn |
|
| 7,403 |
|
| 64,998 |
|
PIMCO Total Return Fund, |
|
| 14,286 |
|
| 166,984 |
|
Transamerica WMC Emerging |
|
| 68,949 |
|
| 984,592 |
|
|
|
|
|
|
| ||
TOTAL UNAFFILIATED |
|
|
|
|
| 3,728,366 |
|
|
|
|
|
|
| ||
| |||||||
Exchange Traded Funds—7.2% |
|
|
|
|
|
|
|
Consumer Staples Select Sector |
|
| 1,816 |
|
| 52,246 |
|
Health Care Select Sector SPDR Fund |
|
| 2,136 |
|
| 66,494 |
|
iShares iBoxx $ Investment Grade |
|
| 1,171 |
|
| 131,574 |
|
PowerShares Global Listed Private |
|
| 59,001 |
|
| 623,051 |
|
SPDR S&P International Consumer |
|
| 1,728 |
|
| 52,773 |
|
SPDR S&P International Health Care |
|
| 1,440 |
|
| 43,502 |
|
|
|
|
|
|
|
|
|
Exchange Traded Funds, continued |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
SPDR S&P International |
|
| 1,040 |
|
| 26,998 |
|
Vanguard Telecommunication |
|
| 237 |
|
| 15,042 |
|
|
|
|
|
|
| ||
TOTAL EXCHANGE TRADED |
|
|
|
|
| 1,011,680 |
|
|
|
|
|
|
| ||
TOTAL INVESTMENTS—99.6% |
|
|
|
|
| 14,050,328 |
|
|
|
|
|
|
|
|
|
| Percentages indicated are based on net assets of $14,102,990. |
|
|
(a) | The rate represents the annualized one-day yield that was in effect on October 31, 2010. |
|
|
ETF | — Exchange Traded Fund |
SPDR | — Standard & Poor’s Depositary Receipt |
|
|
|
See notes to financial statements | HSBC INVESTOR FAMILY OF FUNDS | 12 |
|
BALANCED STRATEGY FUND |
Schedule of Portfolio Investments—as of October 31, 2010 |
|
|
|
|
|
|
|
|
Affiliated Investment Companies—5.2% | |||||||
|
|
|
|
|
|
|
|
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
HSBC Investor Mid-Cap Fund, |
|
| 218,347 |
|
| 1,596,114 |
|
HSBC Investor Prime Money Market |
|
| 530,482 |
|
| 530,482 |
|
|
|
|
|
|
| ||
TOTAL AFFILIATED |
|
|
|
|
| 2,126,596 |
|
|
|
|
|
|
| ||
| |||||||
Affiliated Portfolios—41.7% |
|
|
|
|
|
|
|
HSBC Investor Growth Portfolio |
|
| 4,669,472 |
|
| 6,625,163 |
|
HSBC Investor International Equity Portfolio |
|
| 936,665 |
|
| 2,234,213 |
|
HSBC Investor Opportunity Portfolio |
|
| 461,079 |
|
| 1,683,953 |
|
HSBC Investor Value Portfolio |
|
| 4,774,420 |
|
| 6,446,088 |
|
|
|
|
|
|
| ||
TOTAL AFFILIATED |
|
|
|
|
| 16,989,417 |
|
|
|
|
|
|
| ||
| |||||||
Unaffiliated Investment Companies—46.4% |
|
|
|
|
|
|
|
BlackRock Latin America Fund, Inc., |
|
| 3,572 |
|
| 269,213 |
|
Cohen & Steers Institutional Global |
|
| 14,469 |
|
| 305,442 |
|
Delaware Emerging Markets Fund, |
|
| 64,740 |
|
| 995,061 |
|
EII Global Property Fund, |
|
| 21,392 |
|
| 315,744 |
|
Goldman Sachs Emerging Markets |
|
| 215,901 |
|
| 2,821,890 |
|
Goldman Sachs High Yield Fund, |
|
| 388,938 |
|
| 2,845,273 |
|
Highbridge Statistical Market Neutral |
|
| 11,773 |
|
| 180,717 |
|
JPMorgan High Yield Fund, |
|
| 341,349 |
|
| 2,802,472 |
|
Lord Abbett Core Fixed Income Fund, |
|
| 107,700 |
|
| 1,238,423 |
|
Metropolitan West Total Return |
|
| 115,159 |
|
| 1,237,093 |
|
Northern Institutional Diversified |
|
| 40,343 |
|
| 40,343 |
|
PIMCO Commodity RealReturn Strategy |
|
| 299,014 |
|
| 2,625,340 |
|
PIMCO Total Return Fund, |
|
| 141,510 |
|
| 1,654,103 |
|
Transamerica WMC Emerging Markets |
|
| 107,764 |
|
| 1,538,865 |
|
|
|
|
|
|
| ||
TOTAL UNAFFILIATED |
|
|
|
|
| 18,869,979 |
|
|
|
|
|
|
| ||
| |||||||
Exchange Traded Funds—6.7% |
|
|
|
|
|
|
|
Consumer Staples Select Sector SPDR Fund |
|
| 5,377 |
|
| 154,696 |
|
Health Care Select Sector SPDR Fund |
|
| 5,298 |
|
| 164,927 |
|
iShares iBoxx $Investment Grade Corporate Bond Fund |
|
| 6,871 |
|
| 772,025 |
|
PowerShares Global Listed Private Equity Portfolio ETF |
|
| 120,644 |
|
| 1,274,001 |
|
|
|
|
|
|
|
|
|
Exchange Traded Funds, continued |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
SPDR S&P International Consumer |
|
| 4,476 |
|
| 136,697 |
|
SPDR S&P International Health Care |
|
| 3,403 |
|
| 102,805 |
|
SPDR S&P International |
|
| 3,079 |
|
| 79,931 |
|
Vanguard Telecommunication |
|
| 696 |
|
| 44,175 |
|
|
|
|
|
|
| ||
TOTAL EXCHANGE TRADED |
|
|
|
|
| 2,729,257 |
|
|
|
|
|
|
| ||
TOTAL INVESTMENTS—100.0% |
|
|
|
|
| 40,715,249 |
|
|
|
|
|
|
|
|
|
| Percentages indicated are based on net assets of $40,732,596. |
|
|
(a) | The rate represents the annualized one-day yield that was in effect on October 31, 2010. |
|
|
ETF | — Exchange Traded Fund |
SPDR | — Standard & Poor’s Depositary Receipt |
|
|
|
13 | HSBC INVESTOR FAMILY OF FUNDS | See notes to financial statements |
|
MODERATE STRATEGY FUND |
Schedule of Portfolio Investments—as of October 31, 2010 |
|
|
|
|
|
|
|
|
Affiliated Investment Companies—3.9% | |||||||
|
|
|
|
|
|
|
|
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
HSBC Investor Mid-Cap Fund, |
|
| 150,549 |
|
| 1,100,514 |
|
HSBC Investor Prime Money Market |
|
| 470,360 |
|
| 470,360 |
|
|
|
|
|
|
| ||
TOTAL AFFILIATED |
|
|
|
|
| 1,570,874 |
|
|
|
|
|
|
| ||
| |||||||
Affiliated Portfolios—29.9% |
|
|
|
|
|
|
|
HSBC Investor Growth Portfolio |
|
| 3,070,904 |
|
| 4,357,075 |
|
HSBC Investor International Equity |
|
| 916,353 |
|
| 2,185,765 |
|
HSBC Investor Opportunity Portfolio |
|
| 297,827 |
|
| 1,087,724 |
|
HSBC Investor Value Portfolio |
|
| 3,162,111 |
|
| 4,269,260 |
|
|
|
|
|
|
| ||
TOTAL AFFILIATED |
|
|
|
|
| 11,899,824 |
|
|
|
|
|
|
| ||
| |||||||
Unaffiliated Investment Companies—61.1% |
|
|
|
|
|
|
|
BlackRock Latin America Fund, Inc., |
|
| 2,633 |
|
| 198,457 |
|
Cohen & Steers Institutional Global |
|
| 11,904 |
|
| 251,285 |
|
Delaware Emerging Markets Fund, |
|
| 47,604 |
|
| 731,666 |
|
EII Global Property Fund, |
|
| 20,810 |
|
| 307,151 |
|
Goldman Sachs Emerging Markets |
|
| 239,105 |
|
| 3,125,169 |
|
Goldman Sachs High Yield Fund, |
|
| 381,238 |
|
| 2,786,786 |
|
Highbridge Statistical Market Neutral |
|
| 34,670 |
|
| 532,179 |
|
JPMorgan High Yield Fund, |
|
| 335,620 |
|
| 2,755,437 |
|
Lord Abbett Core Fixed Income Fund, |
|
| 246,529 |
|
| 2,834,804 |
|
Metropolitan West Total Return |
|
| 263,600 |
|
| 2,831,707 |
|
Northern Institutional Diversified |
|
| 32,556 |
|
| 32,556 |
|
PIMCO Commodity RealReturn Strategy |
|
| 345,990 |
|
| 3,037,793 |
|
PIMCO Total Return Fund, |
|
| 322,260 |
|
| 3,766,833 |
|
Transamerica WMC Emerging Markets |
|
| 79,636 |
|
| 1,137,204 |
|
|
|
|
|
|
| ||
TOTAL UNAFFILIATED |
|
|
|
|
| 24,329,027 |
|
|
|
|
|
|
| ||
| |||||||
Exchange Traded Funds—5.0% |
|
|
|
|
|
|
|
Consumer Staples Select Sector |
|
| 4,092 |
|
| 117,727 |
|
Health Care Select Sector SPDR Fund |
|
| 3,948 |
|
| 122,901 |
|
iShares iBoxx $ Investment Grade |
|
| 6,766 |
|
| 760,228 |
|
PowerShares Global Listed Private |
|
| 65,775 |
|
| 694,584 |
|
|
|
|
|
|
|
|
|
Exchange Traded Funds, continued |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
SPDR S&P International Consumer |
|
| 3,400 |
|
| 103,836 |
|
SPDR S&P International Health Care |
|
| 2,640 |
|
| 79,754 |
|
SPDR S&P International |
|
| 2,445 |
|
| 63,473 |
|
Vanguard Telecommunication |
|
| 569 |
|
| 36,114 |
|
|
|
|
|
|
| ||
TOTAL EXCHANGE TRADED |
|
|
|
|
| 1,978,617 |
|
|
|
|
|
|
| ||
TOTAL INVESTMENTS—99.9% |
|
|
|
|
| 39,778,342 |
|
|
|
|
|
|
|
|
|
| Percentages indicated are based on net assets of $39,827,610. |
|
|
(a) | The rate represents the annualized one-day yield that was in effect on October 31, 2010. |
|
|
ETF | — Exchange Traded Fund |
SPDR | — Standard & Poor’s Depositary Receipt |
|
|
|
See notes to financial statements | HSBC INVESTOR FAMILY OF FUNDS | 14 |
|
CONSERVATIVE STRATEGY FUND |
Schedule of Portfolio Investments—as of October 31, 2010 |
|
|
|
|
|
|
|
|
Affiliated Investment Companies—3.1% | |||||||
|
|
|
|
|
|
|
|
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
HSBC Investor Mid-Cap Fund, |
|
| 34,397 |
|
| 251,441 |
|
HSBC Investor Prime Money Market |
|
| 239,347 |
|
| 239,347 |
|
|
|
|
|
|
| ||
TOTAL AFFILIATED |
|
|
|
|
| 490,788 |
|
|
|
|
|
|
| ||
| |||||||
Affiliated Portfolios—20.9% |
|
|
|
|
|
|
|
HSBC Investor Growth Portfolio |
|
| 760,370 |
|
| 1,078,832 |
|
HSBC Investor International Equity |
|
| 372,404 |
|
| 888,289 |
|
HSBC Investor Opportunity Portfolio |
|
| 73,386 |
|
| 268,019 |
|
HSBC Investor Value Portfolio |
|
| 797,449 |
|
| 1,076,660 |
|
|
|
|
|
|
| ||
TOTAL AFFILIATED |
|
|
|
|
| 3,311,800 |
|
|
|
|
|
|
| ||
| |||||||
Unaffiliated Investment Companies—73.2% |
|
|
|
|
|
|
|
Cohen & Steers Institutional Global |
|
| 956 |
|
| 20,179 |
|
Delaware Emerging Markets Fund, |
|
| 3,488 |
|
| 53,607 |
|
EII Global Property Fund, |
|
| 1,370 |
|
| 20,225 |
|
Goldman Sachs Emerging Markets Debt |
|
| 91,615 |
|
| 1,197,436 |
|
Goldman Sachs High Yield Fund, |
|
| 144,535 |
|
| 1,056,535 |
|
Highbridge Statistical Market Neutral |
|
| 27,772 |
|
| 426,295 |
|
JPMorgan High Yield Fund, |
|
| 129,754 |
|
| 1,065,284 |
|
Lord Abbett Core Fixed Income Fund, |
|
| 171,409 |
|
| 1,971,001 |
|
Metropolitan West Total Return |
|
| 183,281 |
|
| 1,968,888 |
|
Northern Institutional Diversified |
|
| 41,910 |
|
| 41,910 |
|
PIMCO Commodity RealReturn Strategy |
|
| 123,963 |
|
| 1,088,394 |
|
PIMCO Total Return Fund, |
|
| 224,550 |
|
| 2,624,725 |
|
Transamerica WMC Emerging Markets |
|
| 5,765 |
|
| 82,324 |
|
|
|
|
|
|
| ||
TOTAL UNAFFILIATED |
|
|
|
|
| 11,616,803 |
|
|
|
|
|
|
| ||
| |||||||
Exchange Traded Funds—2.9% |
|
|
|
|
|
|
|
Consumer Staples Select Sector |
|
| 906 |
|
| 26,066 |
|
Health Care Select Sector SPDR Fund |
|
| 876 |
|
| 27,270 |
|
iShares iBoxx $ Investment Grade |
|
| 2,699 |
|
| 303,260 |
|
PowerShares Global Listed Private |
|
| 3,961 |
|
| 41,828 |
|
SPDR S&P International Consumer |
|
| 739 |
|
| 22,569 |
|
|
|
|
|
|
|
|
|
Exchange Traded Funds, continued | |||||||
|
|
|
|
|
|
|
|
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
SPDR S&P International Health Care |
|
| 580 |
|
| 17,522 |
|
SPDR S&P International |
|
| 542 |
|
| 14,070 |
|
Vanguard Telecommunication |
|
| 124 |
|
| 7,870 |
|
|
|
|
|
|
| ||
TOTAL EXCHANGE TRADED |
|
|
|
|
| 460,455 |
|
|
|
|
|
|
| ||
TOTAL INVESTMENTS—100.1% |
|
|
|
|
| 15,879,846 |
|
|
|
|
|
|
|
|
|
| Percentages indicated are based on net assets of $15,872,522. |
|
|
(a) | The rate represents the annualized one-day yield that was in effect on October 31, 2010. |
|
|
ETF | — Exchange Traded Fund |
SPDR | — Standard & Poor’s Depositary Receipt |
|
|
|
15 | HSBC INVESTOR FAMILY OF FUNDS | See notes to financial statements |
(This Page Intentionally Left Blank)
|
HSBC INVESTOR WORLD SELECTION FUNDS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Aggressive |
| Balanced |
| Moderate |
| Conservative |
| ||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments in Affiliated Portfolios |
| $ | 8,354,822 |
| $ | 16,989,417 |
| $ | 11,899,824 |
| $ | 3,311,800 |
|
Investments in Affiliated Funds, at value (a) |
|
| 955,460 |
|
| 2,126,596 |
|
| 1,570,874 |
|
| 490,788 |
|
Investments in non-affiliates, at value |
|
| 4,740,046 |
|
| 21,599,236 |
|
| 26,307,644 |
|
| 12,077,258 |
|
|
|
|
|
|
| ||||||||
Total Investments |
|
| 14,050,328 |
|
| 40,715,249 |
|
| 39,778,342 |
|
| 15,879,846 |
|
|
|
|
|
|
| ||||||||
Receivable for capital shares issued |
|
| 57,590 |
|
| 135,162 |
|
| 148,216 |
|
| 63,982 |
|
Receivable for investments sold |
|
| 1,226 |
|
| — |
|
| — |
|
| — |
|
Income and dividends receivable |
|
| 326 |
|
| 3,254 |
|
| 7,564 |
|
| 5,266 |
|
Reclaims receivable |
|
| 6,536 |
|
| 15,453 |
|
| 13,265 |
|
| 3,050 |
|
Receivable from Custodian |
|
| 445 |
|
| 1,153 |
|
| 992 |
|
| 231 |
|
Receivable from Investment Adviser |
|
| 6,382 |
|
| 1,690 |
|
| 1,667 |
|
| 660 |
|
Prepaid expenses and other assets |
|
| 9,127 |
|
| 10,185 |
|
| 10,691 |
|
| 7,510 |
|
|
|
|
|
|
| ||||||||
Total Assets |
|
| 14,131,960 |
|
| 40,882,146 |
|
| 39,960,737 |
|
| 15,960,545 |
|
|
|
|
|
|
| ||||||||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash overdraft |
|
| 1,247 |
|
| 59 |
|
| 55 |
|
| 28 |
|
Payable for capital shares redeemed |
|
| — |
|
| 49,195 |
|
| 39,612 |
|
| 19,377 |
|
Payable for investments purchased |
|
| — |
|
| 40,167 |
|
| 32,365 |
|
| 41,738 |
|
Accrued expenses and other liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment Management |
|
| 586 |
|
| 1,690 |
|
| 1,667 |
|
| 660 |
|
Administration |
|
| 246 |
|
| 709 |
|
| 699 |
|
| 278 |
|
Distribution |
|
| 3,860 |
|
| 11,700 |
|
| 13,083 |
|
| 5,378 |
|
Shareholder Servicing |
|
| 2,919 |
|
| 8,423 |
|
| 8,327 |
|
| 3,292 |
|
Compliance Services |
|
| 1 |
|
| 1 |
|
| 1 |
|
| — |
|
Transfer Agent |
|
| 8,518 |
|
| 13,450 |
|
| 13,850 |
|
| 6,820 |
|
Trustee |
|
| 26 |
|
| 71 |
|
| 69 |
|
| 28 |
|
Other |
|
| 11,567 |
|
| 24,085 |
|
| 23,399 |
|
| 10,424 |
|
|
|
|
|
|
| ||||||||
Total Liabilities |
|
| 28,970 |
|
| 149,550 |
|
| 133,127 |
|
| 88,023 |
|
|
|
|
|
|
| ||||||||
Net Assets |
| $ | 14,102,990 |
| $ | 40,732,596 |
| $ | 39,827,610 |
| $ | 15,872,522 |
|
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Composition of Net Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital |
|
| 14,106,624 |
|
| 40,100,764 |
|
| 39,429,019 |
|
| 15,503,420 |
|
Accumulated net investment income (loss) |
|
| 16,716 |
|
| 489,748 |
|
| 102,701 |
|
| 44,293 |
|
Accumulated net realized gains (losses) from investment and foreign currency transactions |
|
| (1,222,999 | ) |
| (3,130,645 | ) |
| (2,825,032 | ) |
| (620,866 | ) |
Unrealized appreciation/depreciation from investments and foreign currencies |
|
| 1,202,649 |
|
| 3,272,729 |
|
| 3,120,922 |
|
| 945,675 |
|
|
|
|
|
|
| ||||||||
Net Assets |
| $ | 14,102,990 |
| $ | 40,732,596 |
| $ | 39,827,610 |
| $ | 15,872,522 |
|
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Shares |
| $ | 7,885,834 |
| $ | 21,642,278 |
| $ | 18,921,081 |
| $ | 7,138,641 |
|
Class B Shares |
|
| 5,519,142 |
|
| 15,593,267 |
|
| 18,362,456 |
|
| 7,411,018 |
|
Class C Shares |
|
| 698,014 |
|
| 3,497,051 |
|
| 2,544,073 |
|
| 1,322,863 |
|
|
|
|
|
|
| ||||||||
|
| $ | 14,102,990 |
| $ | 40,732,596 |
| $ | 39,827,610 |
| $ | 15,872,522 |
|
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares Outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
|
($0.001 par value, unlimited number of shares authorized): |
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Shares |
|
| 655,558 |
|
| 1,789,497 |
|
| 1,648,799 |
|
| 640,476 |
|
Class B Shares |
|
| 478,455 |
|
| 1,293,989 |
|
| 1,601,635 |
|
| 672,240 |
|
Class C Shares |
|
| 60,535 |
|
| 289,188 |
|
| 227,602 |
|
| 116,803 |
|
Net Asset Value, Offering Price and Redemption Price per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Shares |
| $ | 12.03 |
| $ | 12.09 |
| $ | 11.48 |
| $ | 11.15 |
|
Class B Shares (b) |
| $ | 11.54 |
| $ | 12.05 |
| $ | 11.46 |
| $ | 11.02 |
|
Class C Shares (b) |
| $ | 11.53 |
| $ | 12.09 |
| $ | 11.18 |
| $ | 11.33 |
|
Maximum Sales Charge—Class A Shares |
|
| 5.00 | % |
| 5.00 | % |
| 5.00 | % |
| 5.00 | % |
|
|
|
|
|
| ||||||||
Maximum Offering Price per share (Net Asset Value/(100%-maximum sales charge))—Class A Shares |
| $ | 12.66 |
| $ | 12.73 |
| $ | 12.08 |
| $ | 11.74 |
|
|
|
|
|
|
| ||||||||
Investments in Affiliated Funds, at cost (a) |
| $ | 881,535 |
| $ | 1,971,690 |
| $ | 1,458,441 |
| $ | 466,457 |
|
Investments in non-affiliates, at cost |
|
| 4,441,143 |
|
| 20,320,525 |
|
| 24,774,271 |
|
| 11,540,477 |
|
|
|
|
|
|
|
|
|
|
| ||
(a) | The investment in the affiliated funds is the HSBC Investor Prime Money Market Fund, Class I Shares and HSBC Investor Mid Cap Fund, Class I Shares (See Note 1). | |
| ||
(b) | Redemption Price per share varies by length of time shares are held. |
|
|
|
17 | HSBC INVESTOR WORLD SELECTION FUNDS | See notes to financial statements |
|
HSBC INVESTOR WORLD SELECTION FUNDS |
�� |
Statements of Operations—For the year ended October 31, 2010 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Aggressive |
| Balanced |
| Moderate |
| Conservative |
| ||||
Investment Income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment income from non-affiliates |
| $ | 102,265 |
| $ | 786,708 |
| $ | 1,051,487 |
| $ | 427,183 |
|
Investment Income from Affiliated Portfolios (a) |
|
| 98,247 |
|
| 206,371 |
|
| 178,963 |
|
| 45,700 |
|
Investment income from Affiliated Funds |
|
| 200 |
|
| 651 |
|
| 1,132 |
|
| 858 |
|
Tax reclaims from Affiliated Portfolios (a) |
|
| 3,444 |
|
| 2,372 |
|
| 3,144 |
|
| 3,322 |
|
Foreign tax withholding from Affiliated Portfolios (a) |
|
| (4,952 | ) |
| (9,148 | ) |
| (9,410 | ) |
| (2,806 | ) |
Expenses from Affiliated Portfolios (a) |
|
| (57,769 | ) |
| (121,632 | ) |
| (97,874 | ) |
| (23,480 | ) |
|
|
|
|
|
| ||||||||
Total Investment Income (Loss) |
|
| 141,435 |
|
| 865,322 |
|
| 1,127,442 |
|
| 450,777 |
|
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment Management |
|
| 5,709 |
|
| 16,545 |
|
| 17,625 |
|
| 6,207 |
|
Administration: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Shares |
|
| 1,322 |
|
| 3,620 |
|
| 3,538 |
|
| 1,157 |
|
Class B Shares |
|
| 905 |
|
| 2,579 |
|
| 3,237 |
|
| 1,201 |
|
Class C Shares |
|
| 95 |
|
| 482 |
|
| 377 |
|
| 166 |
|
Distribution: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Class B Shares |
|
| 33,424 |
|
| 95,941 |
|
| 119,635 |
|
| 44,375 |
|
Class C Shares |
|
| 3,485 |
|
| 17,817 |
|
| 13,940 |
|
| 6,124 |
|
Shareholder Servicing: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Shares |
|
| 16,268 |
|
| 44,883 |
|
| 43,641 |
|
| 14,231 |
|
Class B Shares |
|
| 11,144 |
|
| 31,978 |
|
| 39,887 |
|
| 14,791 |
|
Class C Shares |
|
| 1,161 |
|
| 5,938 |
|
| 4,646 |
|
| 2,038 |
|
Accounting |
|
| 19,187 |
|
| 19,189 |
|
| 19,189 |
|
| 19,176 |
|
Compliance Services |
|
| 50 |
|
| 147 |
|
| 156 |
|
| 54 |
|
Custodian |
|
| 24,968 |
|
| 29,001 |
|
| 28,465 |
|
| 23,249 |
|
Printing |
|
| 21,455 |
|
| 49,577 |
|
| 54,988 |
|
| 19,801 |
|
Transfer Agent |
|
| 49,561 |
|
| 78,953 |
|
| 77,439 |
|
| 39,663 |
|
Trustee |
|
| 172 |
|
| 499 |
|
| 535 |
|
| 187 |
|
Registration fees |
|
| 11,603 |
|
| 12,589 |
|
| 13,975 |
|
| 7,168 |
|
Other |
|
| 6,975 |
|
| 13,231 |
|
| 13,664 |
|
| 6,063 |
|
|
|
|
|
|
| ||||||||
Total expenses before fee reductions |
|
| 207,484 |
|
| 422,969 |
|
| 454,937 |
|
| 205,651 |
|
Fees contractually reduced by Investment Adviser |
|
| (56,869 | ) |
| — |
|
| — |
|
| — |
|
Fees voluntarily reduced by Investment Adviser |
|
| — |
|
| (16,545 | ) |
| (17,625 | ) |
| (6,207 | ) |
|
|
|
|
|
| ||||||||
Net Expenses |
|
| 150,615 |
|
| 406,424 |
|
| 437,312 |
|
| 199,444 |
|
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Investment Income (Loss) |
|
| (9,180 | ) |
| 458,898 |
|
| 690,130 |
|
| 251,333 |
|
|
|
|
|
|
| ||||||||
| |||||||||||||
Net Realized/Unrealized Gains (Losses) from Investments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net realized gains(losses) from affiliated investments and foreign currency transactions (a) |
|
| 597,399 |
|
| 1,440,050 |
|
| 1,202,953 |
|
| 264,527 |
|
Net realized gains(losses) from investments and foreign currency transactions |
|
| 10,267 |
|
| 421,472 |
|
| 827,311 |
|
| 461,923 |
|
Change in unrealized appreciation/depreciation from affiliated investments and foreign currencies (a) |
|
| 938,942 |
|
| 2,064,187 |
|
| 1,586,517 |
|
| 392,873 |
|
Change in unrealized appreciation/depreciation from investments and foreign currencies |
|
| 298,903 |
|
| 1,017,291 |
|
| 913,830 |
|
| 258,786 |
|
|
|
|
|
|
| ||||||||
Net realized/unrealized gains from investments and foreign currency transactions |
|
| 1,845,511 |
|
| 4,943,000 |
|
| 4,530,611 |
|
| 1,378,109 |
|
|
|
|
|
|
| ||||||||
Change In Net Assets Resulting From Operations |
| $ | 1,836,331 |
| $ | 5,401,898 |
| $ | 5,220,741 |
| $ | 1,629,442 |
|
|
|
|
|
|
|
|
|
|
| ||
(a) | Represents amounts allocated from the respective Affiliated Portfolios. |
|
|
|
See notes to financial statements | HSBC INVESTOR WORLD SELECTION FUNDS | 18 |
|
HSBC INVESTOR WORLD SELECTION FUNDS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Aggressive Strategy Fund |
| Balanced Strategy Fund |
| ||||||||
|
| For the |
| For the |
| For the |
| For the |
| ||||
Investment Activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income (loss) |
| $ | (9,180 | ) | $ | (19,050 | ) | $ | 458,898 |
| $ | 121,934 |
|
Net realized gains (losses) from investments transactions |
|
| 607,666 |
|
| (1,143,628 | ) |
| 1,861,522 |
|
| (3,219,284 | ) |
Change in unrealized appreciation/depreciation from investments and foreign currencies |
|
| 1,237,845 |
|
| 2,619,167 |
|
| 3,081,478 |
|
| 7,340,545 |
|
|
|
|
|
|
| ||||||||
Change in net assets resulting from operations |
|
| 1,836,331 |
|
| 1,456,489 |
|
| 5,401,898 |
|
| 4,243,195 |
|
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Shares |
|
| — |
|
| — |
|
| (120,819 | ) |
| (139,550 | ) |
Class B Shares |
|
| — |
|
| — |
|
| (13,178 | ) |
| (7,901 | ) |
Class C Shares |
|
| — |
|
| — |
|
| (2,104 | ) |
| (1,544 | ) |
|
|
|
|
|
| ||||||||
Change in net assets resulting from shareholder dividends |
|
| — |
|
| — |
|
| (136,101 | ) |
| (148,995 | ) |
|
|
|
|
|
| ||||||||
Change in net assets resulting from capital transactions |
|
| 2,784,370 |
|
| (31,438 | ) |
| 7,459,473 |
|
| (447,939 | ) |
|
|
|
|
|
| ||||||||
Change in net assets |
|
| 4,620,701 |
|
| 1,425,051 |
|
| 12,725,270 |
|
| 3,646,261 |
|
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning of period |
|
| 9,482,289 |
|
| 8,057,238 |
|
| 28,007,326 |
|
| 24,361,065 |
|
|
|
|
|
|
| ||||||||
End of period |
| $ | 14,102,990 |
| $ | 9,482,289 |
| $ | 40,732,596 |
| $ | 28,007,326 |
|
|
|
|
|
|
| ||||||||
Accumulated net investment income (loss) |
| $ | 16,716 |
| $ | — |
| $ | 489,748 |
| $ | 122,678 |
|
|
|
|
|
|
|
|
|
|
19 | HSBC INVESTOR WORLD SELECTION FUNDS | See notes to financial statements |
|
HSBC INVESTOR WORLD SELECTION FUNDS |
|
Statements of Changes in Net Assets (continued) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Aggressive Strategy Fund |
| Balanced Strategy Fund |
| ||||||||
|
| For the |
| For the |
| For the |
| For the |
| ||||
CAPITAL TRANSACTIONS: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from shares issued |
| $ | 2,263,565 |
| $ | 919,824 |
| $ | 5,390,506 |
| $ | 1,604,683 |
|
Dividends reinvested |
|
| — |
|
| — |
|
| 118,661 |
|
| 138,893 |
|
Value of shares redeemed |
|
| (860,729 | ) |
| (913,945 | ) |
| (2,048,014 | ) |
| (2,526,023 | ) |
|
|
|
|
|
| ||||||||
Class A Shares capital transactions |
|
| 1,402,836 |
|
| 5,879 |
|
| 3,461,153 |
|
| (782,447 | ) |
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class B Shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from shares issued |
|
| 1,549,215 |
|
| 424,668 |
|
| 4,043,666 |
|
| 935,667 |
|
Dividends reinvested |
|
| — |
|
| — |
|
| 13,153 |
|
| 7,888 |
|
Value of shares redeemed |
|
| (509,274 | ) |
| (383,617 | ) |
| (1,683,420 | ) |
| (915,409 | ) |
|
|
|
|
|
| ||||||||
Class B Shares capital transactions |
|
| 1,039,941 |
|
| 41,051 |
|
| 2,373,399 |
|
| 28,146 |
|
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class C Shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from shares issued |
|
| 470,488 |
|
| 16,971 |
|
| 1,889,455 |
|
| 496,755 |
|
Dividends reinvested |
|
| — |
|
| — |
|
| 2,040 |
|
| 1,544 |
|
Value of shares redeemed |
|
| (128,895 | ) |
| (95,339 | ) |
| (266,574 | ) |
| (191,937 | ) |
|
|
|
|
|
| ||||||||
Class C Shares capital transactions |
|
| 341,593 |
|
| (78,368 | ) |
| 1,624,921 |
|
| 306,362 |
|
|
|
|
|
|
| ||||||||
Change in net assets resulting from capital transactions |
| $ | 2,784,370 |
| $ | (31,438 | ) | $ | 7,459,473 |
| $ | (447,939 | ) |
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SHARE TRANSACTIONS: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Issued |
|
| 200,993 |
|
| 108,502 |
|
| 480,315 |
|
| 177,228 |
|
Reinvested |
|
| — |
|
| — |
|
| 10,886 |
|
| 17,211 |
|
Redeemed |
|
| (77,306 | ) |
| (107,013 | ) |
| (182,412 | ) |
| (293,206 | ) |
|
|
|
|
|
| ||||||||
Change in Class A Shares |
|
| 123,687 |
|
| 1,489 |
|
| 308,789 |
|
| (98,767 | ) |
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class B Shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Issued |
|
| 144,296 |
|
| 50,718 |
|
| 358,138 |
|
| 104,902 |
|
Reinvested |
|
| — |
|
| — |
|
| 1,203 |
|
| 973 |
|
Redeemed |
|
| (48,010 | ) |
| (45,783 | ) |
| (151,283 | ) |
| (105,971 | ) |
|
|
|
|
|
| ||||||||
Change in Class B Shares |
|
| 96,286 |
|
| 4,935 |
|
| 208,058 |
|
| (96 | ) |
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class C Shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Issued |
|
| 43,232 |
|
| 2,243 |
|
| 167,676 |
|
| 58,266 |
|
Reinvested |
|
| — |
|
| — |
|
| 186 |
|
| 190 |
|
Redeemed |
|
| (12,008 | ) |
| (11,023 | ) |
| (24,287 | ) |
| (19,296 | ) |
|
|
|
|
|
| ||||||||
Change in Class C Shares |
|
| 31,224 |
|
| (8,780 | ) |
| 143,575 |
|
| 39,160 |
|
|
|
|
|
|
|
|
|
|
See notes to financial statements | HSBC INVESTOR WORLD SELECTION FUNDS | 20 |
|
HSBC INVESTOR WORLD SELECTION FUNDS |
|
Statements of Changes in Net Assets (continued) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Moderate Strategy Fund |
| Conservative Strategy Fund |
| ||||||||
|
| For the |
| For the |
| For the |
| For the |
| ||||
Investment Activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income (loss) |
| $ | 690,130 |
| $ | 304,905 |
| $ | 251,333 |
| $ | 110,589 |
|
Net realized gains (losses) from investments transactions |
|
| 2,030,264 |
|
| (3,357,874 | ) |
| 726,450 |
|
| (973,853 | ) |
Change in unrealized appreciation/depreciation from investments and foreign currencies |
|
| 2,500,347 |
|
| 7,600,975 |
|
| 651,659 |
|
| 2,220,121 |
|
|
|
|
|
|
| ||||||||
Change in net assets resulting from operations |
|
| 5,220,741 |
|
| 4,548,006 |
|
| 1,629,442 |
|
| 1,356,857 |
|
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Shares |
|
| (395,383 | ) |
| (193,616 | ) |
| (127,525 | ) |
| (71,561 | ) |
Class B Shares |
|
| (254,802 | ) |
| (84,484 | ) |
| (93,624 | ) |
| (34,422 | ) |
Class C Shares |
|
| (32,803 | ) |
| (9,513 | ) |
| (14,198 | ) |
| (3,180 | ) |
|
|
|
|
|
| ||||||||
Change in net assets resulting from shareholder dividends |
|
| (682,988 | ) |
| (287,613 | ) |
| (235,347 | ) |
| (109,163 | ) |
|
|
|
|
|
| ||||||||
Change in net assets resulting from capital transactions |
|
| 3,662,397 |
|
| (620,407 | ) |
| 4,028,105 |
|
| (322,434 | ) |
|
|
|
|
|
| ||||||||
Change in net assets |
|
| 8,200,150 |
|
| 3,639,986 |
|
| 5,422,200 |
|
| 925,260 |
|
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning of period |
|
| 31,627,460 |
|
| 27,987,474 |
|
| 10,450,322 |
|
| 9,525,062 |
|
|
|
|
|
|
| ||||||||
End of period |
| $ | 39,827,610 |
| $ | 31,627,460 |
| $ | 15,872,522 |
| $ | 10,450,322 |
|
|
|
|
|
|
| ||||||||
Accumulated net investment income (loss) |
| $ | 102,701 |
| $ | 46,429 |
| $ | 44,293 |
| $ | 11,295 |
|
|
|
|
|
|
|
|
|
|
21 | HSBC INVESTOR WORLD SELECTION FUNDS | See notes to financial statements |
|
HSBC INVESTOR WORLD SELECTION FUNDS |
|
Statements of Changes in Net Assets (continued) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Moderate Strategy Fund |
| Conservative Strategy Fund |
| ||||||||
|
| For the |
| For the |
| For the |
| For the |
| ||||
CAPITAL TRANSACTIONS: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from shares issued |
| $ | 3,956,868 |
| $ | 1,737,577 |
| $ | 2,330,836 |
| $ | 845,986 |
|
Dividends reinvested |
|
| 392,648 |
|
| 193,104 |
|
| 121,984 |
|
| 69,473 |
|
Value of shares redeemed |
|
| (3,557,464 | ) |
| (2,409,781 | ) |
| (1,021,219 | ) |
| (1,218,686 | ) |
|
|
|
|
|
| ||||||||
Class A Shares capital transactions |
|
| 792,052 |
|
| (479,100 | ) |
| 1,431,601 |
|
| (303,227 | ) |
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class B Shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from shares issued |
|
| 3,696,441 |
|
| 1,513,370 |
|
| 2,543,077 |
|
| 770,085 |
|
Dividends reinvested |
|
| 252,936 |
|
| 84,267 |
|
| 92,314 |
|
| 33,341 |
|
Value of shares redeemed |
|
| (1,889,818 | ) |
| (1,629,024 | ) |
| (777,671 | ) |
| (820,164 | ) |
|
|
|
|
|
| ||||||||
Class B Shares capital transactions |
|
| 2,059,559 |
|
| (31,387 | ) |
| 1,857,720 |
|
| (16,738 | ) |
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class C Shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from shares issued |
|
| 1,048,351 |
|
| 297,893 |
|
| 973,280 |
|
| 79,844 |
|
Dividends reinvested |
|
| 32,527 |
|
| 9,424 |
|
| 13,686 |
|
| 3,101 |
|
Value of shares redeemed |
|
| (270,092 | ) |
| (417,237 | ) |
| (248,182 | ) |
| (85,414 | ) |
|
|
|
|
|
| ||||||||
Class C Shares capital transactions |
|
| 810,786 |
|
| (109,920 | ) |
| 738,784 |
|
| (2,469 | ) |
|
|
|
|
|
| ||||||||
Change in net assets resulting from capital transactions |
| $ | 3,662,397 |
| $ | (620,407 | ) | $ | 4,028,105 |
| $ | (322,434 | ) |
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SHARE TRANSACTIONS: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Issued |
|
| 367,550 |
|
| 194,386 |
|
| 220,441 |
|
| 94,440 |
|
Reinvested |
|
| 36,767 |
|
| 22,198 |
|
| 11,600 |
|
| 7,802 |
|
Redeemed |
|
| (332,930 | ) |
| (275,784 | ) |
| (97,162 | ) |
| (133,563 | ) |
|
|
|
|
|
| ||||||||
Change in Class A Shares |
|
| 71,387 |
|
| (59,200 | ) |
| 134,879 |
|
| (31,321 | ) |
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class B Shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Issued |
|
| 343,065 |
|
| 172,132 |
|
| 242,687 |
|
| 87,053 |
|
Reinvested |
|
| 23,691 |
|
| 9,836 |
|
| 8,875 |
|
| 3,828 |
|
Redeemed |
|
| (176,487 | ) |
| (191,599 | ) |
| (74,600 | ) |
| (91,989 | ) |
|
|
|
|
|
| ||||||||
Change in Class B Shares |
|
| 190,269 |
|
| (9,631 | ) |
| 176,962 |
|
| (1,108 | ) |
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class B Shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Issued |
|
| 99,026 |
|
| 33,657 |
|
| 90,908 |
|
| 8,443 |
|
Reinvested |
|
| 3,116 |
|
| 1,125 |
|
| 1,280 |
|
| 348 |
|
Redeemed |
|
| (25,776 | ) |
| (49,433 | ) |
| (23,022 | ) |
| (8,952 | ) |
|
|
|
|
|
| ||||||||
Change in Class C Shares |
|
| 76,366 |
|
| (14,651 | ) |
| 69,166 |
|
| (161 | ) |
|
|
|
|
|
|
|
|
|
See notes to financial statements | HSBC INVESTOR WORLD SELECTION FUNDS | 22 |
|
|
AGGRESSIVE STRATEGY FUND |
Selected data for a share outstanding throughout the periods indicated. (a)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Investment Activities |
| Dividends |
|
|
| |||||||||||||||||
|
|
|
|
|
|
|
| |||||||||||||||||||
|
| Net Asset |
| Net |
| Net Realized |
| Total from |
| Net |
| Total |
| Net Asset |
| |||||||||||
CLASS A SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Year Ended October 31, 2006 |
|
| $ | 10.60 |
|
| 0.01 |
|
| 2.01 |
|
| 2.02 |
|
| (0.05 | ) |
| (0.05 | ) |
|
| $ | 12.57 |
|
|
Year Ended October 31, 2007 |
|
|
| 12.57 |
|
| — | *(e) |
| 2.98 |
|
| 2.98 |
|
| — |
|
| — |
|
|
|
| 15.55 |
|
|
Year Ended October 31, 2008 |
|
|
| 15.55 |
|
| 0.02 | * |
| (6.05 | ) |
| (6.03 | ) |
| (0.90 | ) |
| (0.90 | ) |
|
|
| 8.62 |
|
|
Year Ended October 31, 2009 |
|
|
| 8.62 |
|
| 0.01 | * |
| 1.57 |
|
| 1.58 |
|
| — |
|
| — |
|
|
|
| 10.20 |
|
|
Year Ended October 31, 2010 |
|
|
| 10.20 |
|
| 0.03 | * |
| 1.80 |
|
| 1.83 |
|
| — |
|
| — |
|
|
|
| 12.03 |
|
|
CLASS B SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
|
| $ | 10.57 |
|
| (0.05 | ) |
| 1.97 |
|
| 1.92 |
|
| (0.05 | ) |
| (0.05 | ) |
|
| $ | 12.44 |
|
|
Year Ended October 31, 2007 |
|
|
| 12.44 |
|
| (0.11 | )* |
| 2.94 |
|
| 2.83 |
|
| — |
|
| — |
|
|
|
| 15.27 |
|
|
Year Ended October 31, 2008 |
|
|
| 15.27 |
|
| (0.08 | )* |
| (5.90 | ) |
| (5.98 | ) |
| (0.90 | ) |
| (0.90 | ) |
|
|
| 8.39 |
|
|
Year Ended October 31, 2009 |
|
|
| 8.39 |
|
| (0.06 | )* |
| 1.53 |
|
| 1.47 |
|
| — |
|
| — |
|
|
|
| 9.86 |
|
|
Year Ended October 31, 2010 |
|
|
| 9.86 |
|
| (0.05 | )* |
| 1.73 |
|
| 1.68 |
|
| — |
|
| — |
|
|
|
| 11.54 |
|
|
CLASS C SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
|
| $ | 10.55 |
|
| (0.04 | ) |
| 1.95 |
|
| 1.91 |
|
| (0.05 | ) |
| (0.05 | ) |
|
| $ | 12.41 |
|
|
Year Ended October 31, 2007 |
|
|
| 12.41 |
|
| (0.11 | )* |
| 2.96 |
|
| 2.85 |
|
| — |
|
| — |
|
|
|
| 15.26 |
|
|
Year Ended October 31, 2008 |
|
|
| 15.26 |
|
| (0.08 | )* |
| (5.89 | ) |
| (5.97 | ) |
| (0.90 | ) |
| (0.90 | ) |
|
|
| 8.39 |
|
|
Year Ended October 31, 2009 |
|
|
| 8.39 |
|
| (0.05 | )* |
| 1.51 |
|
| 1.46 |
|
| — |
|
| — |
|
|
|
| 9.85 |
|
|
Year Ended October 31, 2010 |
|
|
| 9.85 |
|
| (0.05 | )* |
| 1.73 |
|
| 1.68 |
|
| — |
|
| — |
|
|
|
| 11.53 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Ratios/Supplementary Data |
| ||||||||||||||||
|
|
|
| ||||||||||||||||||
|
| Total |
| Net Assets |
| Ratio of Net |
| Ratio of Net |
| Ratio of |
| Portfolio |
| ||||||||
CLASS A SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
Year Ended October 31, 2006 |
| 19.15 | % |
|
| $ | 4,116 |
|
| 1.50 | % |
| 0.05 | % |
| 3.52 | % |
| 48.46 | % |
|
Year Ended October 31, 2007 |
| 23.71 | % |
|
|
| 7,046 |
|
| 1.50 | % |
| (0.03 | )% |
| 2.27 | % |
| 45.50 | % |
|
Year Ended October 31, 2008 |
| (40.92 | )%(d) |
|
|
| 4,572 |
|
| 1.50 | % |
| 0.13 | % |
| 1.98 | % |
| 72.33 | % |
|
Year Ended October 31, 2009 |
| 18.33 | %(f) |
|
|
| 5,426 |
|
| 1.50 | % |
| 0.09 | % |
| 2.16 | % |
| 53.42 | % |
|
Year Ended October 31, 2010 |
| 17.94 | %(g) |
|
|
| 7,886 |
|
| 1.50 | % |
| 0.24 | % |
| 2.00 | % |
| 50.21 | % |
|
CLASS B SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
| 18.25 | % |
|
| $ | 2,998 |
|
| 2.25 | % |
| (0.70 | )% |
| 4.33 | % |
| 48.46 | % |
|
Year Ended October 31, 2007 |
| 22.75 | % |
|
|
| 4,942 |
|
| 2.25 | % |
| (0.77 | )% |
| 3.02 | % |
| 45.50 | % |
|
Year Ended October 31, 2008 |
| (41.36 | )%(d) |
|
|
| 3,166 |
|
| 2.25 | % |
| (0.62 | )% |
| 2.73 | % |
| 72.33 | % |
|
Year Ended October 31, 2009 |
| 17.52 | %(f) |
|
|
| 3,767 |
|
| 2.25 | % |
| (0.66 | )% |
| 2.91 | % |
| 53.42 | % |
|
Year Ended October 31, 2010 |
| 17.04 | %(g) |
|
|
| 5,519 |
|
| 2.25 | % |
| (0.51 | )% |
| 2.75 | % |
| 50.21 | % |
|
CLASS C SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
| 18.19 | % |
|
| $ | 229 |
|
| 2.25 | % |
| (0.69 | )% |
| 4.20 | % |
| 48.46 | % |
|
Year Ended October 31, 2007 |
| 22.97 | % |
|
|
| 528 |
|
| 2.25 | % |
| (0.79 | )% |
| 2.99 | % |
| 45.50 | % |
|
Year Ended October 31, 2008 |
| (41.32 | )%(d) |
|
|
| 319 |
|
| 2.25 | % |
| (0.64 | )% |
| 2.73 | % |
| 72.33 | % |
|
Year Ended October 31, 2009 |
| 17.40 | %(f) |
|
|
| 289 |
|
| 2.25 | % |
| (0.59 | )% |
| 2.93 | % |
| 53.42 | % |
|
Year Ended October 31, 2010 |
| 17.06 | %(g) |
|
|
| 698 |
|
| 2.25 | % |
| (0.47 | )% |
| 2.76 | % |
| 50.21 | % |
|
|
|
* | Calculated based on average shares outstanding. |
|
|
(a) | The per share amounts and percentages reflect income and expenses assuming inclusion of the Fund’s proportionate share of the income and expenses of the applicable HSBC Investor Portfolios. The Fund does not include expenses of the affiliated and unaffiliated investment companies in which the Fund invests. |
|
|
(b) | Excludes fee reductions. If such fee reductions had not occurred, the ratio would have been as indicated. |
|
|
(c) | Portfolio turnover rate is calculated by aggregating the results of multiplying the Fund’s investment percentage in the respective Portfolios, affiliated and unaffiliated investments companies by their corresponding portfolio turnover rates. Portfolio turnover rate is calculated on the basis of the Fund as a whole without distinguishing between classes of shares issued. |
|
|
(d) | During the year ended October 31, 2008, certain HSBC Investor Portfolios in which the Fund invests received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.11%, 0.11% and 0.11% for Class A Shares, Class B Shares and Class C Shares, respectively. |
|
|
(e) | Rounds to less than $0.01 or $(0.01). |
|
|
(f) | During the year ended October 31, 2009, certain HSBC Investor Portfolios in which the Fund invests received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.11%, 0.11% and 0.11% for Class A Shares, Class B Shares and Class C Shares, respectively. |
|
|
(g) | During the year ended October 31, 2010, certain HSBC Investor Portfolios in which the Fund invests received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.09%, 0.09% and 0.09% for Class A Shares, Class B Shares and Class C Shares, respectively. |
|
|
|
23 | HSBC INVESTOR WORLD SELECTION FUNDS | See notes to financial statements |
|
BALANCED STRATEGY FUND |
Financial Highlights |
Selected data for a share outstanding throughout the periods indicated. (a)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Investment Activities |
| Dividends |
|
|
| ||||||||||||||||||||
|
|
|
|
|
|
|
| ||||||||||||||||||||||
|
| Net Asset |
| Net |
| Net Realized |
| Total from |
| Net |
| Net Realized |
| Total |
| Net Asset |
| ||||||||||||
CLASS A SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Year Ended October 31, 2006 |
|
| $ | 10.72 |
|
| 0.07 |
|
| 1.69 |
|
| 1.76 |
|
| — |
|
| (0.03 | ) |
| (0.03 | ) |
|
| $ | 12.45 |
|
|
Year Ended October 31, 2007 |
|
|
| 12.45 |
|
| 0.11 | * |
| 2.34 |
|
| 2.45 |
|
| (0.08 | ) |
| (0.09 | ) |
| (0.17 | ) |
|
|
| 14.73 |
|
|
Year Ended October 31, 2008 |
|
|
| 14.73 |
|
| 0.12 | * |
| (5.21 | ) |
| (5.09 | ) |
| (0.09 | ) |
| (0.74 | ) |
| (0.83 | ) |
|
|
| 8.81 |
|
|
Year Ended October 31, 2009 |
|
|
| 8.81 |
|
| 0.07 | * |
| 1.55 |
|
| 1.62 |
|
| (0.09 | ) |
| — |
|
| (0.09 | ) |
|
|
| 10.34 |
|
|
Year Ended October 31, 2010 |
|
|
| 10.34 |
|
| 0.19 | * |
| 1.64 |
|
| 1.83 |
|
| (0.08 | ) |
| — |
|
| (0.08 | ) |
|
|
| 12.09 |
|
|
CLASS B SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
|
| $ | 10.78 |
|
| 0.02 |
|
| 1.66 |
|
| 1.68 |
|
| — |
|
| (0.03 | ) |
| (0.03 | ) |
|
| $ | 12.43 |
|
|
Year Ended October 31, 2007 |
|
|
| 12.43 |
|
| 0.01 | * |
| 2.34 |
|
| 2.35 |
|
| (0.02 | ) |
| (0.09 | ) |
| (0.11 | ) |
|
|
| 14.67 |
|
|
Year Ended October 31, 2008 |
|
|
| 14.67 |
|
| 0.03 | * |
| (5.20 | ) |
| (5.17 | ) |
| — | (g) |
| (0.74 | ) |
| (0.74 | ) |
|
|
| 8.76 |
|
|
Year Ended October 31, 2009 |
|
|
| 8.76 |
|
| 0.01 | * |
| 1.55 |
|
| 1.56 |
|
| (0.01 | ) |
| — |
|
| (0.01 | ) |
|
|
| 10.31 |
|
|
Year Ended October 31, 2010 |
|
|
| 10.31 |
|
| 0.11 | * |
| 1.64 |
|
| 1.75 |
|
| (0.01 | ) |
| — |
|
| (0.01 | ) |
|
|
| 12.05 |
|
|
CLASS C SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
|
| $ | 10.82 |
|
| 0.02 |
|
| 1.67 |
|
| 1.69 |
|
| — |
|
| (0.03 | ) |
| (0.03 | ) |
|
| $ | 12.48 |
|
|
Year Ended October 31, 2007 |
|
|
| 12.48 |
|
| 0.01 | * |
| 2.35 |
|
| 2.36 |
|
| (0.01 | ) |
| (0.09 | ) |
| (0.10 | ) |
|
|
| 14.74 |
|
|
Year Ended October 31, 2008 |
|
|
| 14.74 |
|
| 0.03 | * |
| (5.22 | ) |
| (5.19 | ) |
| (0.01 | ) |
| (0.74 | ) |
| (0.75 | ) |
|
|
| 8.80 |
|
|
Year Ended October 31, 2009 |
|
|
| 8.80 |
|
| 0.01 | * |
| 1.55 |
|
| 1.56 |
|
| (0.01 | ) |
| — |
|
| (0.01 | ) |
|
|
| 10.35 |
|
|
Year Ended October 31, 2010 |
|
|
| 10.35 |
|
| 0.12 | * |
| 1.63 |
|
| 1.75 |
|
| (0.01 | ) |
| — |
|
| (0.01 | ) |
|
|
| 12.09 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Ratios/Supplementary Data |
| ||||||||||||||||
|
|
|
| ||||||||||||||||||
|
| Total |
| Net Assets |
| Ratio of Net |
| Ratio of Net |
| Ratio of |
| Portfolio |
| ||||||||
CLASS A SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
Year Ended October 31, 2006 |
| 16.41 | % |
|
| $ | 12,562 |
|
| 1.50 | % |
| 0.87 | % |
| 2.19 | % |
| 80.30 | % |
|
Year Ended October 31, 2007 |
| 19.92 | %(d) |
|
|
| 21,352 |
|
| 1.50 | % |
| 0.84 | % |
| 1.65 | % |
| 73.45 | % |
|
Year Ended October 31, 2008 |
| (36.43 | )%(e) |
|
|
| 13,908 |
|
| 1.50 | % |
| 0.98 | % |
| 1.53 | % |
| 78.59 | % |
|
Year Ended October 31, 2009 |
| 18.66 | %(f) |
|
|
| 15,304 |
|
| 1.50 | % |
| 0.84 | % |
| 1.57 | % |
| 47.74 | % |
|
Year Ended October 31, 2010 |
| 17.79 | %(h) |
|
|
| 21,642 |
|
| 1.25 | % |
| 1.72 | % |
| 1.30 | % |
| 52.81 | % |
|
CLASS B SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
| 15.57 | % |
|
| $ | 8,702 |
|
| 2.25 | % |
| 0.11 | % |
| 2.94 | % |
| 80.30 | % |
|
Year Ended October 31, 2007 |
| 18.98 | %(d) |
|
|
| 13,905 |
|
| 2.25 | % |
| 0.09 | % |
| 2.40 | % |
| 73.45 | % |
|
Year Ended October 31, 2008 |
| (36.95 | )%(e) |
|
|
| 9,516 |
|
| 2.25 | % |
| 0.24 | % |
| 2.28 | % |
| 78.59 | % |
|
Year Ended October 31, 2009 |
| 17.80 | %(f) |
|
|
| 11,196 |
|
| 2.25 | % |
| 0.07 | % |
| 2.31 | % |
| 47.74 | % |
|
Year Ended October 31, 2010 |
| 17.01 | %(h) |
|
|
| 15,593 |
|
| 2.00 | % |
| 0.97 | % |
| 2.05 | % |
| 52.81 | % |
|
CLASS C SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
| 15.61 | % |
|
| $ | 585 |
|
| 2.25 | % |
| 0.14 | % |
| 2.90 | % |
| 80.30 | % |
|
Year Ended October 31, 2007 |
| 19.04 | %(d) |
|
|
| 1,273 |
|
| 2.25 | % |
| 0.07 | % |
| 2.39 | % |
| 73.45 | % |
|
Year Ended October 31, 2008 |
| (36.94 | )%(e) |
|
|
| 937 |
|
| 2.25 | % |
| 0.25 | % |
| 2.29 | % |
| 78.59 | % |
|
Year Ended October 31, 2009 |
| 17.81 | %(f) |
|
|
| 1,507 |
|
| 2.25 | % |
| 0.06 | % |
| 2.30 | % |
| 47.74 | % |
|
Year Ended October 31, 2010 |
| 16.96 | %(h) |
|
|
| 3,497 |
|
| 2.01 | % |
| 1.04 | % |
| 2.06 | % |
| 52.81 | % |
|
|
|
* | Calculated based on average shares outstanding. |
|
|
(a) | The per share amounts and percentages reflect income and expenses assuming inclusion of the Fund’s proportionate share of the income and expenses of the applicable HSBC Investor Portfolios. The Fund does not include expenses of the affiliated and unaffiliated investment companies in which the Fund invests. |
|
|
(b) | Excludes fee reductions. If such fee reductions had not occurred, the ratio would have been as indicated. |
|
|
(c) | Portfolio turnover rate is calculated by aggregating the results of multiplying the Fund’s investment percentage in the respective Portfolios, affiliated and unaffiliated investments companies by their corresponding portfolio turnover rates. Portfolio turnover rate is calculated on the basis of the Fund as a whole without distinguishing between classes of shares issued. |
|
|
(d) | During the year ended October 31, 2007, certain HSBC Investor Portfolios in which the Fund invests received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.23%, 0.24% and 0.23% for Class A Shares, Class B Shares and Class C Shares, respectively. |
|
|
(e) | During the year ended October 31, 2008, certain HSBC Investor Portfolios in which the Fund invests received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.15%, 0.15% and 0.15% for Class A Shares, Class B Shares and Class C Shares, respectively. |
|
|
(f) | During the year ended October 31, 2009, certain HSBC Investor Portfolios in which the Fund invests received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.11%, 0.11% and 0.11% for Class A Shares, Class B Shares and Class C Shares, respectively. |
|
|
(g) | Rounds to less than $0.01 or $(0.01). |
|
|
(h) | During the year ended October 31, 2010, certain HSBC Investor Portfolios in which the Fund invests received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.07%, 0.07% and 0.07% for Class A Shares, Class B Shares and Class C Shares, respectively. |
|
|
|
See notes to financial statements | HSBC INVESTOR WORLD SELECTION FUNDS | 24 |
|
MODERATE STRATEGY FUND |
Financial Highlights |
Selected data for a share outstanding throughout the periods indicated. (a)
|
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|
|
|
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|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Investment Activities |
| Dividends |
|
|
|
| ||||||||||||||||||
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||
|
| Net Asset |
| Net |
| Net Realized |
| Total from |
| Net |
| Net |
| Total |
| Net Asset |
| ||||||||||||
CLASS A SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
|
| $ | 10.49 |
|
| 0.17 |
|
| 1.23 |
|
| 1.40 |
|
| (0.17 | ) |
| (0.01 | ) |
| (0.18 | ) |
|
| $ | 11.71 |
|
|
Year Ended October 31, 2007 |
|
|
| 11.71 |
|
| 0.21 | * |
| 1.65 |
|
| 1.86 |
|
| (0.20 | ) |
| (0.10 | ) |
| (0.30 | ) |
|
|
| 13.27 |
|
|
Year Ended October 31, 2008 |
|
|
| 13.27 |
|
| 0.20 | * |
| (4.08 | ) |
| (3.88 | ) |
| (0.19 | ) |
| (0.50 | ) |
| (0.70 | ) |
|
|
| 8.69 |
|
|
Year Ended October 31, 2009 |
|
|
| 8.69 |
|
| 0.13 | * |
| 1.39 |
|
| 1.52 |
|
| (0.12 | ) |
| — |
|
| (0.12 | ) |
|
|
| 10.09 |
|
|
Year Ended October 31, 2010 |
|
|
| 10.09 |
|
| 0.25 | * |
| 1.38 |
|
| 1.63 |
|
| (0.24 | ) |
| — |
|
| (0.24 | ) |
|
|
| 11.48 |
|
|
CLASS B SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
|
| $ | 10.50 |
|
| 0.09 |
|
| 1.22 |
|
| 1.31 |
|
| (0.08 | ) |
| (0.01 | ) |
| (0.09 | ) |
|
| $ | 11.72 |
|
|
Year Ended October 31, 2007 |
|
|
| 11.72 |
|
| 0.12 | * |
| 1.65 |
|
| 1.77 |
|
| (0.12 | ) |
| (0.10 | ) |
| (0.22 | ) |
|
|
| 13.27 |
|
|
Year Ended October 31, 2008 |
|
|
| 13.27 |
|
| 0.11 | * |
| (4.08 | ) |
| (3.97 | ) |
| (0.10 | ) |
| (0.50 | ) |
| (0.61 | ) |
|
|
| 8.69 |
|
|
Year Ended October 31, 2009 |
|
|
| 8.69 |
|
| 0.06 | * |
| 1.39 |
|
| 1.45 |
|
| (0.06 | ) |
| — |
|
| (0.06 | ) |
|
|
| 10.08 |
|
|
Year Ended October 31, 2010 |
|
|
| 10.08 |
|
| 0.17 | * |
| 1.38 |
|
| 1.55 |
|
| (0.17 | ) |
| — |
|
| (0.17 | ) |
|
|
| 11.46 |
|
|
CLASS C SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
|
| $ | 10.28 |
|
| 0.09 |
|
| 1.19 |
|
| 1.28 |
|
| (0.08 | ) |
| (0.01 | ) |
| (0.09 | ) |
|
| $ | 11.47 |
|
|
Year Ended October 31, 2007 |
|
|
| 11.47 |
|
| 0.12 | * |
| 1.60 |
|
| 1.72 |
|
| (0.12 | ) |
| (0.10 | ) |
| (0.22 | ) |
|
|
| 12.97 |
|
|
Year Ended October 31, 2008 |
|
|
| 12.97 |
|
| 0.11 | * |
| (3.97 | ) |
| (3.86 | ) |
| 0.11 |
|
| (0.50 | ) |
| (0.62 | ) |
|
|
| 8.49 |
|
|
Year Ended October 31, 2009 |
|
|
| 8.49 |
|
| 0.06 | * |
| 1.35 |
|
| 1.41 |
|
| (0.06 | ) |
| — |
|
| (0.06 | ) |
|
|
| 9.84 |
|
|
Year Ended October 31, 2010 |
|
|
| 9.84 |
|
| 0.17 | * |
| 1.35 |
|
| 1.52 |
|
| (0.18 | ) |
| — |
|
| (0.18 | ) |
|
|
| 11.18 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Ratios/Supplementary Data |
| |||||||||||||||
|
|
|
|
| |||||||||||||||||
|
| Total |
| Net Assets |
| Ratio of Net |
| Ratio of Net |
| Ratio of |
| Portfolio |
| ||||||||
CLASS A SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
| 13.40 | % |
|
| $ | 11,973 |
|
| 1.50 | % |
| 1.65 | % |
| 2.12 | % |
| 101.57 | % |
|
Year Ended October 31, 2007 |
| 16.12 | %(d) |
|
|
| 20,140 |
|
| 1.50 | % |
| 1.70 | % |
| 1.60 | % |
| 92.87 | % |
|
Year Ended October 31, 2008 |
| (30.65 | )%(e) |
|
|
| 14,226 |
|
| 1.48 | % |
| 1.75 | % |
| 1.48 | % |
| 79.86 | % |
|
Year Ended October 31, 2009 |
| 17.75 | %(f) |
|
|
| 15,909 |
|
| 1.44 | % |
| 1.47 | % |
| 1.49 | % |
| 41.29 | % |
|
Year Ended October 31, 2010 |
| 16.39 | %(g) |
|
|
| 18,921 |
|
| 1.14 | % |
| 2.33 | % |
| 1.19 | % |
| 66.98 | % |
|
CLASS B SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
| 12.45 | % |
|
| $ | 10,731 |
|
| 2.25 | % |
| 0.91 | % |
| 2.87 | % |
| 101.57 | % |
|
Year Ended October 31, 2007 |
| 15.25 | %(d) |
|
|
| 16,513 |
|
| 2.25 | % |
| 0.95 | % |
| 2.35 | % |
| 92.87 | % |
|
Year Ended October 31, 2008 |
| (31.17 | )%(e) |
|
|
| 12,354 |
|
| 2.23 | % |
| 1.00 | % |
| 2.23 | % |
| 79.86 | % |
|
Year Ended October 31, 2009 |
| 16.82 | %(f) |
|
|
| 14,230 |
|
| 2.19 | % |
| 0.71 | % |
| 2.24 | % |
| 41.29 | % |
|
Year Ended October 31, 2010 |
| 15.61 | %(g) |
|
|
| 18,362 |
|
| 1.89 | % |
| 1.59 | % |
| 1.94 | % |
| 66.98 | % |
|
CLASS C SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
| 12.53 | % |
|
| $ | 763 |
|
| 2.25 | % |
| 0.87 | % |
| 2.83 | % |
| 101.57 | % |
|
Year Ended October 31, 2007 |
| 15.20 | %(d) |
|
|
| 1,766 |
|
| 2.25 | % |
| 0.95 | % |
| 2.33 | % |
| 92.87 | % |
|
Year Ended October 31, 2008 |
| (31.09 | )%(e) |
|
|
| 1,408 |
|
| 2.23 | % |
| 1.00 | % |
| 2.23 | % |
| 79.86 | % |
|
Year Ended October 31, 2009 |
| 16.75 | %(f) |
|
|
| 1,488 |
|
| 2.19 | % |
| 0.72 | % |
| 2.24 | % |
| 41.29 | % |
|
Year Ended October 31, 2010 |
| 15.55 | %(g) |
|
|
| 2,544 |
|
| 1.90 | % |
| 1.59 | % |
| 1.95 | % |
| 66.98 | % |
|
|
|
* | Calculated based on average shares outstanding. |
|
|
(a) | The per share amounts and percentages reflect income and expenses assuming inclusion of the Fund’s proportionate share of the income and expenses of the applicable HSBC Investor Portfolios. The Fund does not include expenses of the affiliated and unaffiliated investment companies in which the Fund invests. |
|
|
(b) | Excludes fee reductions. If such fee reductions had not occurred, the ratio would have been as indicated. |
|
|
(c) | Portfolio turnover rate is calculated by aggregating the results of multiplying the Fund’s investment percentage in the respective Portfolios, affiliated and unaffiliated investment companies by their corresponding portfolio turnover rates. Portfolio turnover rate is calculated on the basis of the Fund as a whole without distinguishing between classes of shares issued. |
|
|
(d) | During the year ended October 31, 2007, certain HSBC Investor Portfolios in which the Fund invests received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.41%, 0.41% and 0.33% for Class A Shares, Class B Shares and Class C Shares, respectively. |
|
|
(e) | During the year ended October 31, 2008, certain HSBC Investor Portfolios in which the Fund invests received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.19%, 0.19% and 0.19% for Class A Shares, Class B Shares and Class C Shares, respectively. |
|
|
(f) | During the year ended October 31, 2009, certain HSBC Investor Portfolios in which the Fund invests received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.09%, 0.09% and 0.09% for Class A Shares, Class B Shares and Class C Shares, respectively. |
|
|
(g) | During the year ended October 31, 2010, certain HSBC Investor Portfolios in which the Fund invests received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.06%, 0.06% and 0.06% for Class A Shares, Class B Shares and Class C Shares, respectively. |
|
|
|
25 | HSBC INVESTOR WORLD SELECTION FUNDS | See notes to financial statements |
|
CONSERVATIVE STRATEGY FUND |
Financial Highlights |
Selected data for a share outstanding throughout the periods indicated. (a)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Investment Activities |
| Dividends |
|
|
|
|
|
| ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||
|
| Net Asset |
| Net |
| Net Realized |
| Total from |
| Net |
| Net |
| Total |
| Net Asset |
| ||||||||||||
CLASS A SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
|
| $ | 10.29 |
|
| 0.22 |
|
| 0.85 |
|
| 1.07 |
|
| (0.25 | ) |
| — |
|
| (0.25 | ) |
|
| $ | 11.11 |
|
|
Year Ended October 31, 2007 |
|
|
| 11.11 |
|
| 0.29 | * |
| 1.03 |
|
| 1.32 |
|
| (0.27 | ) |
| (0.12 | ) |
| (0.39 | ) |
|
|
| 12.04 |
|
|
Year Ended October 31, 2008 |
|
|
| 12.04 |
|
| 0.24 | * |
| (2.93 | ) |
| (2.69 | ) |
| (0.25 | ) |
| (0.26 | ) |
| (0.51 | ) |
|
|
| 8.84 |
|
|
Year Ended October 31, 2009 |
|
|
| 8.84 |
|
| 0.14 | * |
| 1.16 |
|
| 1.30 |
|
| (0.13 | ) |
| — |
|
| (0.13 | ) |
|
|
| 10.01 |
|
|
Year Ended October 31, 2010 |
|
|
| 10.01 |
|
| 0.26 | * |
| 1.11 |
|
| 1.37 |
|
| (0.23 | ) |
| — |
|
| (0.23 | ) |
|
|
| 11.15 |
|
|
CLASS B SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
|
| $ | 10.19 |
|
| 0.15 |
|
| 0.83 |
|
| 0.98 |
|
| (0.16 | ) |
| — |
|
| (0.16 | ) |
|
| $ | 11.01 |
|
|
Year Ended October 31, 2007 |
|
|
| 11.01 |
|
| 0.20 | * |
| 1.05 |
|
| 1.25 |
|
| (0.20 | ) |
| (0.12 | ) |
| (0.32 | ) |
|
|
| 11.94 |
|
|
Year Ended October 31, 2008 |
|
|
| 11.94 |
|
| 0.16 | * |
| (2.91 | ) |
| (2.75 | ) |
| (0.17 | ) |
| (0.26 | ) |
| (0.43 | ) |
|
|
| 8.76 |
|
|
Year Ended October 31, 2009 |
|
|
| 8.76 |
|
| 0.07 | * |
| 1.15 |
|
| 1.22 |
|
| (0.07 | ) |
| — |
|
| (0.07 | ) |
|
|
| 9.91 |
|
|
Year Ended October 31, 2010 |
|
|
| 9.91 |
|
| 0.17 | * |
| 1.10 |
|
| 1.27 |
|
| (0.16 | ) |
| — |
|
| (0.16 | ) |
|
|
| 11.02 |
|
|
CLASS C SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
|
| $ | 10.41 |
|
| 0.15 |
|
| 0.85 |
|
| 1.00 |
|
| (0.17 | ) |
| — |
|
| (0.17 | ) |
|
| $ | 11.24 |
|
|
Year Ended October 31, 2007 |
|
|
| 11.24 |
|
| 0.21 | * |
| 1.11 |
|
| 1.32 |
|
| (0.19 | ) |
| (0.12 | ) |
| (0.31 | ) |
|
|
| 12.25 |
|
|
Year Ended October 31, 2008 |
|
|
| 12.25 |
|
| 0.16 | * |
| (2.98 | ) |
| (2.82 | ) |
| (0.17 | ) |
| (0.26 | ) |
| (0.43 | ) |
|
|
| 9.00 |
|
|
Year Ended October 31, 2009 |
|
|
| 9.00 |
|
| 0.07 | * |
| 1.18 |
|
| 1.25 |
|
| (0.07 | ) |
| — |
|
| (0.07 | ) |
|
|
| 10.18 |
|
|
Year Ended October 31, 2010 |
|
|
| 10.18 |
|
| 0.18 | * |
| 1.14 |
|
| 1.32 |
|
| (0.17 | ) |
| — |
|
| (0.17 | ) |
|
|
| 11.33 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Ratios/Supplementary Data |
| |||||||||||||||
|
|
|
|
| |||||||||||||||||
|
| Total |
| Net Assets |
| Ratio of Net |
| Ratio of Net |
| Ratio of |
| Portfolio |
| ||||||||
CLASS A SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
| 10.48 | % |
|
| $ | 3,069 |
|
| 1.50 | % |
| 2.33 | % |
| 3.22 | % |
| 96.58 | % |
|
Year Ended October 31, 2007 |
| 12.13 | %(d) |
|
|
| 6,669 |
|
| 1.50 | % |
| 2.52 | % |
| 2.06 | % |
| 88.67 | % |
|
Year Ended October 31, 2008 |
| (23.17 | )%(e) |
|
|
| 4,747 |
|
| 1.50 | % |
| 2.24 | % |
| 1.72 | % |
| 68.74 | % |
|
Year Ended October 31, 2009 |
| 14.95 | %(f) |
|
|
| 5,059 |
|
| 1.50 | % |
| 1.53 | % |
| 1.62 | % |
| 34.40 | % |
|
Year Ended October 31, 2010 |
| 13.86 | %(g) |
|
|
| 7,139 |
|
| 1.38 | % |
| 2.42 | % |
| 1.43 | % |
| 78.48 | % |
|
CLASS B SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
| 9.65 | % |
|
| $ | 2,567 |
|
| 2.25 | % |
| 1.54 | % |
| 3.98 | % |
| 96.58 | % |
|
Year Ended October 31, 2007 |
| 11.51 | %(d) |
|
|
| 4,928 |
|
| 2.25 | % |
| 1.77 | % |
| 2.82 | % |
| 88.67 | % |
|
Year Ended October 31, 2008 |
| (23.76 | )%(e) |
|
|
| 4,348 |
|
| 2.25 | % |
| 1.48 | % |
| 2.48 | % |
| 68.74 | % |
|
Year Ended October 31, 2009 |
| 14.05 | %(f) |
|
|
| 4,907 |
|
| 2.25 | % |
| 0.77 | % |
| 2.38 | % |
| 34.40 | % |
|
Year Ended October 31, 2010 |
| 12.94 | %(g) |
|
|
| 7,411 |
|
| 2.14 | % |
| 1.68 | % |
| 2.19 | % |
| 78.48 | % |
|
CLASS C SHARES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
| 9.66 | % |
|
| $ | 320 |
|
| 2.25 | % |
| 1.56 | % |
| 3.92 | % |
| 96.58 | % |
|
Year Ended October 31, 2007 |
| 11.97 | %(d) |
|
|
| 437 |
|
| 2.25 | % |
| 1.78 | % |
| 2.85 | % |
| 88.67 | % |
|
Year Ended October 31, 2008 |
| (23.73 | )%(e) |
|
|
| 430 |
|
| 2.25 | % |
| 1.46 | % |
| 2.48 | % |
| 68.74 | % |
|
Year Ended October 31, 2009 |
| 13.97 | %(f) |
|
|
| 485 |
|
| 2.25 | % |
| 0.78 | % |
| 2.37 | % |
| 34.40 | % |
|
Year Ended October 31, 2010 |
| 13.07 | %(g) |
|
|
| 1,323 |
|
| 2.16 | % |
| 1.71 | % |
| 2.21 | % |
| 78.48 | % |
|
|
|
* | Calculated based on average shares outstanding. |
|
|
(a) | The per share amounts and percentages reflect income and expenses assuming inclusion of the Fund’s proportionate share of the income and expenses of the applicable HSBC Investor Portfolios. The Fund does not include expenses of the affiliated and unaffiliated investment companies in which the Fund invests. |
|
|
(b) | Excludes fee reductions. If such fee reductions had not occurred, the ratio would have been as indicated. |
|
|
(c) | Portfolio turnover rate is calculated by aggregating the results of multiplying the Fund’s investment percentage in the respective Portfolios affiliated and unaffiliated investment companies by their corresponding portfolio turnover rates. Portfolio turnover rate is calculated on the basis of the Fund as a whole without distinguishing between classes of shares issued. |
|
|
(d) | During the year ended October 31, 2007, certain HSBC Investor Portfolios in which the Fund invests received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.44%, 0.47% and 0.48% for Class A Shares, Class B Shares and Class C Shares, respectively. |
|
|
(e) | During the year ended October 31, 2008, certain HSBC Investor Portfolios in which the Fund invests received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.19%, 0.19% and 0.19% for Class A Shares, Class B Shares and Class C Shares, respectively. |
|
|
(f) | During the year ended October 31, 2009, certain HSBC Investor Portfolios in which the Fund invests received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.08%, 0.08% and 0.08% for Class A Shares, Class B Shares and Class C Shares, respectively. |
|
|
(g) | During the year ended October 31, 2010, certain HSBC Investor Portfolios in which the Fund invests received monies related to certain nonrecurring litigation settlements. The corresponding impact to the total return was 0.05%, 0.05% and 0.05% for Class A Shares, Class B Shares and Class C Shares, respectively. |
|
|
|
See notes to financial statements | HSBC INVESTOR WORLD SELECTION FUNDS | 26 |
|
HSBC INVESTOR WORLD SELECTION FUNDS |
|
|
1. | Organization: |
|
|
| The HSBC Investor Funds (the “Trust’’), a Massachusetts business trust organized on April 22, 1987, is registered under the Investment Company Act of 1940, as amended (the “Act’’), as an open-end management investment company. As of October 31, 2010, the Trust is comprised of 15 separate operational funds, each a series of the HSBC Investor Family of Funds. The accompanying financial statements are presented for the following 4 funds (individually a “Fund’’, collectively the “World Selection Funds’’): |
|
|
|
| Fund | Short Name |
| ||
| HSBC Aggressive Strategy Fund | Aggressive Strategy Fund |
| HSBC Balanced Strategy Fund | Balanced Strategy Fund |
| HSBC Moderate Strategy Fund | Moderate Strategy Fund |
| HSBC Conservative Strategy Fund | Conservative Strategy Fund |
|
|
| The World Selection Funds are diversified series of the Trust and part of the HSBC Investor Family of Funds. Financial statements for all other funds of the HSBC Investor Family of Funds are published separately. |
|
|
| Each of the World Selection Funds is a “fund of funds,” meaning that it seeks to achieve its investment objective by investing primarily in a combination of mutual funds managed by HSBC Global Asset Management (USA) Inc. (“HSBC” or the “Investment Adviser”) (the “Affiliated Underlying Funds”), as well as mutual funds managed by other investment advisers and exchange-traded funds (“Unaffiliated Underlying Funds” and, together with the Affiliated Underlying Funds, the “Underlying Funds”). Each Fund may also purchase and hold exchange-traded notes (“ETNs”). The Underlying Funds may include private equity funds and real estate funds that are organized as mutual funds or Exchange Traded Funds (“ETFs”). Each World Selection Fund invests according to the investment objectives and strategies described in its Prospectus. |
|
|
|
|
| The financial statements of the Portfolios, including the Schedules of Portfolio Investments, are included elsewhere in this report. The financial statements of the Portfolios should be read in conjunction with the financial statements of the World Selection Funds. |
|
|
| The World Selection Funds are authorized to issue an unlimited number of shares of beneficial interest with a par value of $0.001 per share. Each Fund offers three classes of shares: Class A Shares, Class B Shares and Class C Shares. Class A Shares of the World Selection Funds have a maximum sales charge of 5.00% as a percentage of the original purchase price. The Class B Shares of the World Selection Funds are offered without any front-end sales charge, but will be subject to a contingent deferred sales charge (“CDSC”) ranging from a maximum of 4.00% if redeemed less than one year after purchase to 0.00% if redeemed more than four years after purchase. Class C Shares of the World Selection Funds are offered without any front-end sales charge, but will be subject to a maximum CDSC of 1.00% if redeemed less than one year after purchase. Each class of shares in the World Selection Funds has identical rights and privileges except with respect to arrangements pertaining to shareholder servicing or distribution, class-related expenses, voting rights on matters affecting a single class of shares, and the exchange privileges of each class of shares. |
|
|
| Under the Trust’s organizational documents, the World Selection Funds’ Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the World Selection Funds. In addition, in the normal course of business, the Trust enters into contracts with its service providers, which also provide for indemnifications by the World Selection Funds. The World Selection Funds’ maximum exposure under these arrangements is unknown as this would involve any future claims that may be made against the World Selection Funds. However, based on experience, the Trust expects the risk of loss to be remote. |
|
|
27 | HSBC INVESTOR WORLD SELECTION FUNDS |
|
HSBC INVESTOR WORLD SELECTION FUNDS |
Notes to Financial Statements—as of October 31, 2010 (continued) |
|
|
2. | Significant Accounting Policies: |
|
|
|
|
| The following is a summary of the significant accounting policies followed by the World Selection Funds in the preparation of their financial statements. The policies are in conformity with U.S. generally accepted accounting principles (“GAAP’’). The preparation of financial statements requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. Management has evaluated events and transactions through the date the financial statements were available to be issued, for purposes of recognition or disclosure in these financial statements and there are no subsequent events to report. |
|
|
| Securities Valuation: |
|
|
| The World Selection Funds record their investments in the Underlying Funds at the net asset value reported by those funds. The World Selection Funds record their investments in the Portfolios at fair value. The underlying securities of the Portfolios are recorded at fair value, as more fully discussed in the notes to those financial statements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The valuation techniques used to determine fair value in funds in which the World Selection Funds are invested are described in their respective notes to financial statements. |
|
|
| Investment Transactions and Related Income: |
|
|
| The World Selection Funds record daily their pro-rata income, expenses and unrealized/realized gains and losses derived from their respective Portfolios. Dividend income is recorded on the ex-dividend date for the Underlying Funds. Changes in holdings of the Underlying Funds for each World Selection Fund are reflected no later than the first business day following trade date. However, for financial reporting purposes, changes in holdings of the Underlying Funds are reflected as of trade date. In addition, the World Selection Funds accrue their own expenses daily as incurred. |
|
|
| Allocations: |
|
|
| Expenses directly attributable to a Fund are charged to that Fund. Expenses not directly attributable to a Fund are allocated proportionately among various or all funds within the HSBC Investor Family of Funds in relation to the net assets of each fund or on another reasonable basis. Class specific expenses are charged directly to the class incurring the expense. In addition, income, expenses (other than class specific expenses), and unrealized/realized gains and losses are allocated to each class based on relative net assets on a daily basis. |
|
|
| Dividends to Shareholders: |
|
|
| Dividends to shareholders from net investment income, if any, are declared and distributed quarterly in the case of the Moderate Strategy Fund and Conservative Strategy Fund, and annually in the case of the Aggressive Strategy Fund and Balanced Strategy Fund. |
|
|
| The World Selection Funds’ net realized gains, if any, are distributed to shareholders at least annually. Additional distributions are also made to the World Selection Funds’ shareholders to the extent necessary to avoid the federal excise tax on certain undistributed income and net capital gains of regulated investment companies. |
|
|
| The amount and character of net investment income and net realized gains distributions are determined in accordance with federal income tax regulations which may differ from GAAP. These “book/tax’’ differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature (e.g., reclassification of market discounts, certain gain/loss, paydowns, and certain distributions), such amounts are reclassified within the composition of net assets; temporary differences (e.g., wash losses and post-October loss deferrals) do not require reclassification. The World Selection Funds may utilize equalization accounting for tax purposes and designate earnings and profits, including net realized gains distributed to shareholders on redemption of shares, as a part of the dividends paid deduction for income tax purposes. To the extent distributions to shareholders from net investment income and net realized gains exceed net investment income and net realized gains for tax purposes, they are reported as distributions of capital. |
|
|
HSBC INVESTOR WORLD SELECTION FUNDS | 28 |
|
HSBC INVESTOR WORLD SELECTION FUNDS |
Notes to Financial Statements—as of October 31, 2010 (continued) |
|
|
| Redemption Fee: |
|
|
| Prior to February 28, 2010 a redemption fee of 2.00% was charged and recorded as paid-in-capital for any shares redeemed or exchanged after being held for less than 30 days. This fee did not apply to shares purchased through reinvested dividends or capital gains or shares held in certain omnibus accounts or retirement plans that could not implement the fee. The Trustees have approved the removal of such redemption fee effective February 28, 2010. For the fiscal years ended October 31, 2009 and October 31, 2010, respectively, the following World Selection Funds collected redemption fees as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
Fund |
| Fees Collected |
| Fees Collected |
| ||||||
|
|
| |||||||||
Aggressive Strategy Fund |
| $ |
| 47 |
| $ |
| 3 |
| ||
Balanced Strategy Fund |
|
|
| 431 |
|
|
| 11 |
| ||
Moderate Strategy Fund |
|
|
| 259 |
|
|
| 10 |
| ||
Conservative Strategy Fund |
|
|
| 63 |
|
|
| 1 |
|
|
|
|
| Federal Income Taxes: | |
|
| |
| Each Fund is a separate taxable entity for federal income tax purposes. Each Fund has qualified and intends to continue to qualify each year as a “regulated investment company’’ under Subchapter M of the Internal Revenue Code, as amended and to distribute substantially all of their taxable net investment income and net realized gains, if any, to their shareholders. Accordingly, no provision for federal income or excise tax is required. | |
|
| |
| Management of the Funds has reviewed tax positions taken in tax years that remain subject to examination by all major tax jurisdictions, including federal (i.e., the last four tax year ends and the interim tax period since then, as applicable). Management believes that there is no tax liability resulting from unrecognized tax benefits related to uncertain tax positions taken. | |
|
| |
3. | Investment Valuation Summary: | |
|
| |
| The valuation techniques employed by the World Selection Funds maximize the use of observable inputs and minimize the use of unobservable inputs in determining fair value. The inputs used for valuing the World Selection Funds’ investments are summarized in the three broad levels listed below: |
|
|
|
| • Level 1: | quoted prices in active markets for identical assets |
|
|
|
| • Level 2: | other significant observable inputs (including quoted prices for similar securities, interest rates, prepayments speeds, credit risk, etc.) |
|
|
|
| • Level 3: | significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments) |
|
|
|
| The inputs or methodology used for valuing investments are not necessarily an indication of the risk associated with investing in those investments. | |
|
| |
| The World Selection Funds record their investments in the Underlying Funds at the net asset value reported by those funds and are typically categorized as Level 1 in the fair value hierarchy. The World Selection Funds record their investments in their respective Portfolios at fair value and are typically categorized as a Level 2 in the fair value hierarchy. The underlying securities of the Portfolios are recorded at fair value, respectively, as more fully discussed below. | |
|
| |
| For the year ended October 31, 2010, there were no Level 3 investments for which significant unobservable inputs were used to determine fair value. | |
|
| |
| The following is a summary of the valuation inputs used as of October 31, 2010 in valuing the World Selection Funds’ investments based upon the three levels defined above: |
|
|
29 | HSBC INVESTOR WORLD SELECTION FUNDS |
|
HSBC INVESTOR WORLD SELECTION FUNDS |
Notes to Financial Statements—as of October 31, 2010 (continued) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| LEVEL 1 |
| LEVEL 2 |
| LEVEL 3 |
| Total |
| ||||
|
|
|
|
|
| ||||||||
Aggressive Strategy Fund |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment Companies: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Affiliated Investment Companies |
| $ | 955,460 |
| $ | — |
| $ | — |
| $ | 955,460 |
|
Affiliated Portfolios (a) |
|
| — |
|
| 8,354,822 |
|
| — |
|
| 8,354,822 |
|
Unaffiliated Investment Companies |
|
| 3,728,366 |
|
| — |
|
| — |
|
| 3,728,366 |
|
Exchange Traded Funds |
|
| 1,011,680 |
|
| — |
|
| — |
|
| 1,011,680 |
|
|
|
|
|
|
| ||||||||
Total Investment Companies |
| $ | 5,695,506 |
| $ | 8,354,822 |
| $ | — |
| $ | 14,050,328 |
|
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balanced Strategy Fund |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment Companies: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Affiliated Investment Companies |
| $ | 2,126,596 |
| $ | — |
| $ | — |
| $ | 2,126,596 |
|
Affiliated Portfolios (a) |
|
| — |
|
| 16,989,416 |
|
| — |
|
| 16,989,417 |
|
Unaffiliated Investment Companies |
|
| 18,869,979 |
|
| — |
|
| — |
|
| 18,869,979 |
|
Exchange Traded Funds |
|
| 2,729,257 |
|
| — |
|
| — |
|
| 2,729,257 |
|
|
|
|
|
|
| ||||||||
Total Investment Companies |
| $ | 23,725,832 |
| $ | 16,989,416 |
| $ | — |
| $ | 40,715,249 |
|
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Moderate Strategy Fund |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment Companies: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Affiliated Investment Companies |
| $ | 1,570,874 |
| $ | — |
| $ | — |
| $ | 1,570,874 |
|
Affiliated Portfolios (a) |
|
| — |
|
| 11,899,824 |
|
| — |
|
| 11,899,824 |
|
Unaffiliated Investment Companies |
|
| 24,329,027 |
|
| — |
|
| — |
|
| 24,329,027 |
|
Exchange Traded Funds |
|
| 1,978,617 |
|
| — |
|
| — |
|
| 1,978,617 |
|
|
|
|
|
|
| ||||||||
Total Investment Companies |
| $ | 27,878,518 |
| $ | 11,899,824 |
| $ | — |
| $ | 39,778,342 |
|
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Conservative Strategy Fund |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment Companies: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Affiliated Investment Companies |
| $ | 490,788 |
| $ | — |
| $ | — |
| $ | 490,788 |
|
Affiliated Portfolios (a) |
|
| — |
|
| 3,311,800 |
|
| — |
|
| 3,311,800 |
|
Unaffiliated Investment Companies |
|
| 11,616,803 |
|
| — |
|
| — |
|
| 11,616,803 |
|
Exchange Traded Funds |
|
| 460,455 |
|
| — |
|
| — |
|
| 460,455 |
|
|
|
|
|
|
| ||||||||
Total Investment Companies |
| $ | 12,568,046 |
| $ | 3,311,800 |
| $ | — |
| $ | 15,879,846 |
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
| (a) | Investments in Affiliated Portfolios represent ownership interests in the Portfolios. Due to the Funds’ master-feeder structure, the inputs used for valuing these investments are categorized as Level 2. |
|
|
|
|
| The Trust recognizes significant transfers between fair value hierarchy levels at the reporting period end. There were no significant transfers between Level 1 and 2 as of October 31, 2010. | ||
|
| ||
4. | Related Party Transactions: | ||
|
| ||
| Investment Management: | ||
|
| ||
| The Investment Adviser, a wholly owned subsidiary of HSBC Bank USA, N.A., a national bank organized under the laws of the United States, acts as Investment Adviser to the World Selection Funds. As Investment Adviser, HSBC manages the investments of the World Selection Funds and continuously reviews, supervises and administers the World Selection Funds’ investments. For its services as Investment Adviser, HSBC is entitled to receive a fee, computed daily and paid monthly, based on average daily net assets, at an annual rate of 0.05% for each Fund. The Investment Adviser is voluntarily waiving all of the fee for each of the World Selection Funds. Any voluntary fee waivers/reimbursements are not subject to recoupment in subsequent fiscal periods. Voluntary waivers/ reimbursements may be stopped at any time. |
|
|
HSBC INVESTOR WORLD SELECTION FUNDS | 30 |
|
HSBC INVESTOR WORLD SELECTION FUNDS |
Notes to Financial Statements—as of October 31, 2010 (continued) |
|
|
| Administration: |
|
|
| HSBC serves the World Selection Funds as Administrator. Under the terms of the Administration Agreement, HSBC received from the World Selection Funds (as well as the other funds in the HSBC Investor Family of Funds) a fee, accrued daily and paid monthly, at an annual rate of: |
|
|
|
|
|
Based on Average Daily Net Assets of |
|
| Fee Rate |
|
|
|
| ||
Up to $10 billion |
|
| 0.0550% |
|
In excess of $10 billion but not exceeding $20 billion |
|
| 0.0350% |
|
In excess of $20 billion but not exceeding $50 billion |
|
| 0.0275% |
|
In excess of $50 billion |
|
| 0.0250% |
|
|
|
| The fee breakpoints are determined on the basis of the aggregate average daily net assets of the HSBC Investor Family of Funds. The fee is allocated to each series of the HSBC Investor Family of Funds based upon its pro-rata share of net assets. For assets invested in underlying Portfolios by World Selection Funds, the Portfolios pay half of the administration fee and the World Selection Funds pay half, for a combination of the total fee rate above. Certain administration fees of the Portfolios also may be reduced by treating them as apportioned in part to other funds making investments in the Portfolios in master-feeder structures. An amount equal to 50% of the administration fees is deemed to be class-specific. |
|
|
| Pursuant to a Sub-Administration Agreement with HSBC, Citi Fund Services Ohio, Inc. (“Citi Ohio’’), a wholly-owned subsidiary of Citigroup, Inc., serves as the Sub-Administrator for the Trust and the HSBC Investor Family of Funds (collectively, the “Trusts”) subject to the general supervision of the Trusts’ Board of Trustees and HSBC. For these services, Citi Ohio is entitled to a fee, payable by HSBC, at an annual rate equivalent to the fee rates set forth above, minus 0.02% (2 basis points) which is retained by HSBC. |
|
|
| Under a Compliance Services Agreement between the Trusts and Citi Ohio (the “CCO Agreement’’), Citi Ohio makes an employee available to serve as the Trusts’ Chief Compliance Officer (the “CCO’’). Under the CCO Agreement, Citi Ohio also provides infrastructure and support in implementing the written policies and procedures comprising the Trusts’ compliance program, including support services to the CCO. For the services provided under the CCO Agreement, the HSBC Investor Family of Funds paid Citi Ohio $269,869 for the year ended October 31, 2010, plus reimbursement of certain out of pocket expenses. Expenses incurred by each Fund are reflected on the Statements of Operations as “Compliance Services.’’ Citi Ohio pays the salary and other compensation earned by individuals performing these services, as employees of Citi Ohio. |
|
|
| Distribution Arrangements: |
|
|
| Foreside Distribution Services, L.P. (“Foreside”), a wholly-owned subsidiary of Foreside Financial Group LLC, serves the Trust as Distributor (the “Distributor’’). The Trust has adopted a non-compensatory Distribution Plan and Agreement (the “Distribution Plan’’) pursuant to Rule 12b-1 of the Act. The Distribution Plan provides for reimbursement of expenses incurred by the Distributor related to distribution and marketing, at a rate not to exceed 0.25%, 1.00%, and 1.00% of the average daily net assets of Class A Shares (currently not being charged), Class B Shares (currently charging 0.75%), and Class C Shares (currently charging 0.75%) of the World Selection Funds, respectively. As of the most recent fiscal year end, Foreside, as Distributor, also received $628,328, $459,202, and $43,157 in commissions from sales of HSBC Investor Family of Funds, for Class A Shares, Class B Shares, and Class C Shares, respectively of which $60, $12, and $— were reallocated to HSBC-affiliated brokers and dealers, for Class A Shares, Class B Shares, and Class C Shares, respectively. |
|
|
| Shareholder Servicing: |
|
|
| The Trust has adopted a Shareholder Services Plan which provides for payments to shareholder servicing agents (which currently consist of HSBC and its affiliates) for providing various shareholder services. For performing these services, the shareholder servicing agents receive a fee that is computed daily and paid monthly up to 0.25%, 0.25% and 0.25% of the average daily net assets of Class A Shares, Class B Shares and Class C Shares of the World Selection Funds, respectively. The fees paid to the Distributor pursuant to the Distribution Plan and to shareholder servicing agents pursuant to the Shareholder Services Plan currently are not intended to exceed, in the aggregate, 0.25% of the average daily net assets of Class A Shares and 1.00% of the average daily net assets of Class B Shares and Class C Shares. |
|
|
31 | HSBC INVESTOR WORLD SELECTION FUNDS |
|
HSBC INVESTOR WORLD SELECTION FUNDS |
Notes to Financial Statements—as of October 31, 2010 (continued) |
|
|
| Fund Accounting, Transfer Agency and Trustees: |
|
|
| Citi Ohio provides fund accounting and transfer agency services for the Trusts. As transfer agent, Citi Ohio receives a fee based on the number of funds and shareholder accounts, subject to certain minimums and reimbursement of certain expenses. As fund accountant, Citi Ohio receives an annual fee per fund and share class, subject to minimums and reimbursement of certain expenses. Citi Ohio receives additional fees paid by the Trust for blue sky exemption services. |
|
|
| Each non-interested Trustee is compensated with a $60,000 annual Board retainer for service as a Trustee of the Trusts and Portfolio Trust, as well as a $3,000 annual retainer for each Committee of the Board of the Trusts and Portfolio Trust. Each non-interested Trustee also receives a $5,000 and $3,000 meeting fee for each regular in-person Board meeting and Committee meeting, respectively. Furthermore, each non-interested Trustee receives compensation for attending special meetings and/or functioning as a Committee or Board Chairperson. In addition, the non-interested Trustees are reimbursed for certain expenses incurred in connection with their Board membership. |
|
|
| Fee Reductions: |
|
|
| The Investment Adviser has agreed to contractually limit through March 1, 2011 the total expenses, exclusive of interest, taxes, brokerage commissions, and extraordinary expenses of the World Selection Funds. Each Fund Class has its own expense limitations based on the average daily net assets for any full fiscal year as follows: Class A Shares 1.50%, Class B Shares 2.25%, Class C Shares 2.25%. |
|
|
| Any amounts contractually waived or reimbursed by the Investment Adviser will be subject to repayment by the Fund to the Investment Adviser within three years to the extent that the repayment will not cause the Fund’s operating expenses to exceed the contractual expense limit that was in effect at the time of such waiver or reimbursement. During the year ended October 31, 2010, the Investment Adviser did not recapture any of its prior contractual waivers or reimbursements. As of October 31, 2010, the repayments that may potentially be made by the Funds are as follows: |
|
|
|
|
|
|
|
|
|
|
|
Fund |
| 2013* |
| 2012* |
| 2011* |
| |||
|
|
|
| |||||||
Aggressive Strategy Fund |
| $ | 56,869 |
| $ | 49,257 |
| $ | 51,467 |
|
Balanced Strategy Fund |
|
| — |
|
| 3,289 |
|
| — |
|
Moderate Strategy Fund |
|
| — |
|
| — |
|
| — |
|
Conservative Strategy Fund |
|
| — |
|
| 6,592 |
|
| 20,961 |
|
|
|
|
|
|
| ||
|
| * | The year listed above the amounts is the fiscal year ending in which the amounts will no longer be recoupable. |
|
| ||
| The Administrator and Citi Ohio may voluntarily waive/reimburse fees to help support the expense limits of each Fund. In addition, the Investment Adviser may waive/reimburse additional fees at their discretion. Any voluntary fee waivers/reimbursements are not subject to recoupment in subsequent fiscal periods. Voluntary waivers/reimbursements may be stopped at any time. Amounts waived/reimbursed by the Investment Adviser, Administrator, and Citi Ohio are reported separately on the Statements of Operations, as applicable. | ||
|
| ||
5. | Investment Transactions: | ||
|
| ||
| Cost of purchases and proceeds from sales of securities (excluding securities maturing less than one year from acquisition) for the year ended October 31, 2010 were as follows: |
|
|
|
|
|
|
|
|
Fund |
| Purchases |
| Sales |
| ||
|
|
| |||||
Aggressive Strategy Fund |
| $ | 6,444,706 |
| $ | 1,327,317 |
|
Balanced Strategy Fund |
|
| 24,558,228 |
|
| 7,826,585 |
|
Moderate Strategy Fund |
|
| 30,566,290 |
|
| 14,902,100 |
|
Conservative Strategy Fund |
|
| 14,854,961 |
|
| 7,164,128 |
|
|
|
|
|
|
|
|
|
Contributions and withdrawals of the respective Portfolios for the year ended October 31, 2010 totaled: | |||||||
|
|
|
|
|
|
|
|
|
| Contributions |
| Withdrawals |
| ||
|
|
|
| ||||
Aggressive Strategy Fund |
| $ | 3,013,258 |
| $ | 5,630,504 |
|
Balanced Strategy Fund |
|
| 4,314,061 |
|
| 13,805,588 |
|
Moderate Strategy Fund |
|
| 3,336,809 |
|
| 14,085,639 |
|
Conservative Strategy Fund |
|
| 1,344,522 |
|
| 3,161,396 |
|
|
|
HSBC INVESTOR WORLD SELECTION FUNDS | 32 |
|
HSBC INVESTOR WORLD SELECTION FUNDS |
Notes to Financial Statements—as of October 31, 2010 (continued) |
|
|
6. | Federal Tax Information: |
|
|
| At October 31, 2010, the cost basis of securities (which excludes investments in the Affiliated Portfolios) for federal income tax purposes, gross unrealized appreciation, gross unrealized depreciation and net unrealized appreciation/depreciation were as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fund |
| Tax Cost |
| Tax Unrealized |
| Tax Unrealized |
| Net Unrealized |
| ||||
|
|
|
|
| |||||||||
Aggressive Strategy Fund |
| $ | 5,322,678 |
| $ | 375,361 |
| $ | (2,533 | ) | $ | 372,828 |
|
Balanced Strategy Fund |
|
| 22,292,215 |
|
| 1,449,181 |
|
| (15,564 | ) |
| 1,433,617 |
|
Moderate Strategy Fund |
|
| 26,232,712 |
|
| 1,670,346 |
|
| (24,541 | ) |
| 1,645,805 |
|
Conservative Strategy Fund |
|
| 12,006,934 |
|
| 573,666 |
|
| (12,555 | ) |
| 561,111 |
|
|
|
| The tax character of dividends paid by the World Selection Funds for the year ended October 31, 2010 was as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Dividends paid from |
| ||||||||||
|
|
| |||||||||||
|
| Ordinary |
| Net Long Term |
| Total Taxable |
| Total Dividends |
| ||||
|
|
|
|
|
| ||||||||
Aggressive Strategy Fund |
| $ | — |
| $ | — |
| $ | — |
| $ | — |
|
Balanced Strategy Fund |
|
| 136,101 |
|
| — |
|
| 136,101 |
|
| 136,101 |
|
Moderate Strategy Fund |
|
| 682,988 |
|
| — |
|
| 682,988 |
|
| 682,988 |
|
Conservative Strategy Fund |
|
| 235,347 |
|
| — |
|
| 235,347 |
|
| 235,347 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The tax character of dividends paid by the World Selection Funds for the year ended October 31, 2009 was as follows: | |||||||||||||
|
|
|
| ||||||||||
|
| Dividends paid from |
| ||||||||||
|
|
| |||||||||||
|
| Ordinary |
| Net Long Term |
| Total Taxable |
| Total Dividends |
| ||||
|
|
|
|
|
| ||||||||
Aggressive Strategy Fund |
| $ | — |
| $ | — |
| $ | — |
| $ | — |
|
Balanced Strategy Fund |
|
| 148,995 |
|
| — |
|
| 148,995 |
|
| 148,995 |
|
Moderate Strategy Fund |
|
| 287,613 |
|
| — |
|
| 287,613 |
|
| 287,613 |
|
Conservative Strategy Fund |
|
| 109,163 |
|
| — |
|
| 109,163 |
|
| 109,163 |
|
|
|
|
|
|
| ||
|
| (1) | Total dividends paid may differ from the amount reported in the Statement of Changes in Net Assets because dividends are recognized when actually paid for tax purposes. |
|
| ||
| As of October 31, 2010, the components of accumulated earnings/(deficit) on a tax basis for the World Selection Funds were as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Undistributed |
| Undistributed |
| Accumulated |
| Accumulated |
| Unrealized |
| Total |
| ||||||
|
|
|
|
|
|
|
| ||||||||||||
Aggressive Strategy Fund |
| $ | 20,370 |
| $ | — |
| $ | 20,370 |
| $ | (1,154,845 | ) | $ | 1,130,841 |
| $ | (3,634 | ) |
Balanced Strategy Fund |
|
| 496,268 |
|
| — |
|
| 496,268 |
|
| (2,994,043 | ) |
| 3,129,607 |
|
| 631,832 |
|
Moderate Strategy Fund |
|
| 109,080 |
|
| — |
|
| 109,080 |
|
| (2,722,436 | ) |
| 3,011,947 |
|
| 398,591 |
|
Conservative Strategy Fund |
|
| 46,886 |
|
| — |
|
| 46,886 |
|
| (600,432 | ) |
| 922,648 |
|
| 369,102 |
|
|
|
|
|
|
| ||
|
| (1) | The difference between book-basis and tax-basis unrealized appreciation/depreciation are attributable primarily to: tax deferral of losses on wash sales, the realization for tax purposes of unrealized gains/losses on certain derivative instruments, the difference between book and tax amortization methods for premium and market discount, the realization for tax purposes of unrealized gains/losses on investments in passive foreign investment companies, and the return of capital investments from real estate investment trusts. |
|
|
|
|
| As of October 31, 2010, the following World Selection Funds have net capital loss carryforwards, which are available to offset future realized gains, if any, to the extent provided by the Treasury regulations. |
|
|
|
|
|
|
|
|
Fund |
| Amount |
| Expires |
| ||
|
|
| |||||
Aggressive Strategy Fund |
| $ | 26,859 |
|
| 2016 |
|
Aggressive Strategy Fund |
|
| 1,127,986 |
|
| 2017 |
|
Balanced Strategy Fund |
|
| 2,994,043 |
|
| 2017 |
|
Moderate Strategy Fund |
|
| 2,722,436 |
|
| 2017 |
|
Conservative Strategy Fund |
|
| 600,432 |
|
| 2017 |
|
|
|
33 | HSBC INVESTOR WORLD SELECTION FUNDS |
|
HSBC INVESTOR WORLD SELECTION FUNDS |
Notes to Financial Statements—as of October 31, 2010 (continued) |
|
|
| During the year ended October 31, 2010, the following Funds utilized capital loss carryforwards to offset capital gains realized: |
|
|
|
|
|
Fund |
| Amount |
| |
|
| |||
Aggressive Strategy Fund |
| $ | 884,978 |
|
Balanced Strategy Fund |
|
| 2,306,769 |
|
Moderate Strategy Fund |
|
| 2,545,342 |
|
Conservative Strategy Fund |
|
| 901,943 |
|
|
|
7. | Legal and Regulatory Matters: |
|
|
| On September 26, 2006 BISYS Fund Services, Inc. (“BISYS’’), an affiliate of BISYS Fund Services Ohio, Inc. which provided various services to the Funds, reached a settlement with the Securities and Exchange Commission (“the SEC’’) regarding the SEC’s investigation related to BISYS’ past payment of certain marketing and other expenses with respect to certain of its mutual fund clients. There was no impact on the Funds’ financial statements as the funds did not receive any settlement monies. |
|
|
8. | Subsequent Events (Unaudited): |
|
|
| Effective November 1, 2010, each non-interested Trustee is compensated with a $63,000 annual Board retainer for service as a Trustee of the Trust and the other HSBC Investor Funds, as well as a $3,000 annual retainer for each Committee of the Board of the Trust and other HSBC Investor Funds. Each non-interested Trustee also receives a $5,000 and $3,000 meeting fee for each regular in-person Board meeting and Committee meeting, respectively. Furthermore, each non-interested Trustee receives compensation for attending special meetings and/or functioning as a Committee or Board Chairperson. In addition, the noninterested Trustees are reimbursed for certain expenses incurred in connection with their Board membership. |
|
|
HSBC INVESTOR WORLD SELECTION FUNDS | 34 |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Trustees of
HSBC World Selection Funds:
We have audited the accompanying statements of assets and liabilities of HSBC World Selection Funds – HSBC World Selection Aggressive Strategy Fund, HSBC World Selection Balanced Strategy Fund, HSBC World Selection Moderate Strategy Fund and HSBC World Selection Conservative Strategy Fund (the Funds), including the schedules of portfolio investments, as of October 31, 2010, and the related statements of operations for the year then ended, the statements of changes in net assets for each year in the two-year period then ended and the financial highlights for each year in the five-year period then ended. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of October 31, 2010, by correspondence with the respective custodian or broker. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Funds as of October 31, 2010, the results of their operations for the year then ended, the changes in their net assets for each year in the two-year period then ended, and the financial highlights for each year in the five-year period then ended, in conformity with U.S. generally accepted accounting principles.
Columbus, Ohio
December 22, 2010
|
|
35 | HSBC INVESTOR WORLD SELECTION FUNDS |
|
HSBC INVESTOR FAMILY OF FUNDS |
Other Federal Income Tax Information (Unaudited)—as of October 31, 2010 |
|
|
| For the year ended October 31, 2010, the following percentages of the total ordinary income dividends paid by the Funds qualify for the corporate dividends received deduction available to corporate shareholders: |
|
|
|
|
|
Fund |
|
| Dividends | |
|
| |||
Balanced Strategy Fund |
| 96.99 | % | |
Moderate Strategy Fund |
| 26.02 | % | |
Conservative Strategy Fund |
| 26.86 | % |
|
|
| For the year ended October 31, 2010, dividends paid by the Funds may be subject to a maximum tax rate of 15%, as provided for by the Jobs and Growth Tax Relief Reconciliation Act of 2003. The Funds intend to designate the maximum amount allowable as taxed at a maximum rate of 15%. Complete information will be reported in conjunction with your 2009 Form 1099-DIV: |
|
|
|
|
|
Fund |
|
| Qualified | |
|
| |||
Balanced Strategy Fund |
| 97.48 | % | |
Moderate Strategy Fund |
| 44.87 | % | |
Conservative Strategy Fund |
| 83.09 | % |
|
|
HSBC INVESTOR WORLD SELECTION FUNDS | 36 |
|
HSBC INVESTOR FAMILY OF FUNDS |
Table of Shareholder Expenses (Unaudited)—as of October 31, 2010 |
|
|
| As a shareholder of the HSBC Investor World Selection Funds (“Funds”), you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases, redemption fees; and exchange fees; (2) ongoing costs, including management fees; distribution and/or shareholder servicing fees; and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds. |
|
|
| These examples are based on an investment of $1,000 invested at the beginning of the period and held for the entire period from May 1, 2010 through October 31, 2010. |
|
|
| Actual Example |
|
|
| The table below provides information about actual account values and actual expenses. You may use the information below, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Beginning |
| Ending |
| Expenses Paid |
| Annualized | ||||||
|
|
|
|
|
|
| ||||||||||
Aggressive Strategy Fund |
| Class A Shares |
| $ | 1,000.00 |
| $ | 1,039.80 |
|
| $ | 7.61 |
|
| 1.48 | % |
|
| Class B Shares |
|
| 1,000.00 |
|
| 1,036.80 |
|
|
| 11.45 |
|
| 2.23 | % |
|
| Class C Shares |
|
| 1,000.00 |
|
| 1,035.90 |
|
|
| 11.44 |
|
| 2.23 | % |
Balanced Strategy Fund |
| Class A Shares |
|
| 1,000.00 |
|
| 1,053.10 |
|
|
| 6.73 |
|
| 1.30 | % |
|
| Class B Shares |
|
| 1,000.00 |
|
| 1,049.70 |
|
|
| 10.59 |
|
| 2.05 | % |
|
| Class C Shares |
|
| 1,000.00 |
|
| 1,049.50 |
|
|
| 10.59 |
|
| 2.05 | % |
Moderate Strategy Fund |
| Class A Shares |
|
| 1,000.00 |
|
| 1,059.50 |
|
|
| 6.28 |
|
| 1.21 | % |
|
| Class B Shares |
|
| 1,000.00 |
|
| 1,054.90 |
|
|
| 10.15 |
|
| 1.96 | % |
|
| Class C Shares |
|
| 1,000.00 |
|
| 1,054.90 |
|
|
| 10.20 |
|
| 1.97 | % |
Conservative Strategy Fund |
| Class A Shares |
|
| 1,000.00 |
|
| 1,058.00 |
|
|
| 7.83 |
|
| 1.51 | % |
|
| Class B Shares |
|
| 1,000.00 |
|
| 1,054.10 |
|
|
| 11.70 |
|
| 2.26 | % |
|
| Class C Shares |
|
| 1,000.00 |
|
| 1,054.90 |
|
|
| 11.71 |
|
| 2.26 | % |
|
|
|
| ||
| * | Expenses are equal to the average account value over the period multiplied by the Funds’ annualized expense ratio, multiplied by the number of days in the most recent fiscal half-year divided by the number of days in the fiscal year (to reflect the one half year period). |
|
|
37 | HSBC INVESTOR WORLD SELECTION FUNDS |
|
HSBC INVESTOR FAMILY OF FUNDS |
Table of Shareholder Expenses (Unaudited)—as of October 31, 2010 (continued) |
|
|
| Hypothetical Example for Comparison Purposes |
|
|
| The table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare 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 transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Beginning |
| Ending |
| Expenses Paid |
| Annualized | ||||||
|
|
|
|
|
|
| ||||||||||
Aggressive Strategy Fund |
| Class A Shares |
| $ | 1,000.00 |
| $ | 1,017.74 |
|
| $ | 7.53 |
|
| 1.48 | % |
|
| Class B Shares |
|
| 1,000.00 |
|
| 1,013.96 |
|
|
| 11.32 |
|
| 2.23 | % |
|
| Class C Shares |
|
| 1,000.00 |
|
| 1,013.96 |
|
|
| 11.32 |
|
| 2.23 | % |
Balanced Strategy Fund |
| Class A Shares |
|
| 1,000.00 |
|
| 1,018.65 |
|
|
| 6.61 |
|
| 1.30 | % |
|
| Class B Shares |
|
| 1,000.00 |
|
| 1,014.87 |
|
|
| 10.41 |
|
| 2.05 | % |
|
| Class C Shares |
|
| 1,000.00 |
|
| 1,014.87 |
|
|
| 10.41 |
|
| 2.05 | % |
Moderate Strategy Fund |
| Class A Shares |
|
| 1,000.00 |
|
| 1,019.11 |
|
|
| 6.16 |
|
| 1.21 | % |
|
| Class B Shares |
|
| 1,000.00 |
|
| 1,015.32 |
|
|
| 9.96 |
|
| 1.96 | % |
|
| Class C Shares |
|
| 1,000.00 |
|
| 1,015.27 |
|
|
| 10.01 |
|
| 1.97 | % |
Conservative Strategy Fund |
| Class A Shares |
|
| 1,000.00 |
|
| 1,017.59 |
|
|
| 7.68 |
|
| 1.51 | % |
|
| Class B Shares |
|
| 1,000.00 |
|
| 1,013.81 |
|
|
| 11.47 |
|
| 2.26 | % |
|
| Class C Shares |
|
| 1,000.00 |
|
| 1,013.81 |
|
|
| 11.47 |
|
| 2.26 | % |
|
|
|
| ||
| * | Expenses are equal to the average account value over the period multiplied by the Funds’ annualized expense ratio, multiplied by the number of days in the most recent fiscal half-year divided by the number of days in the fiscal year (to reflect the one half year period). |
|
|
HSBC INVESTOR WORLD SELECTION FUNDS | 38 |
(This Page Intentionally Left Blank)
|
|
|
|
|
|
|
|
|
Common Stocks—98.1% | |||||||
|
|
|
|
|
|
|
|
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
Aerospace & Defense – 2.9% |
|
|
|
|
|
|
|
Goodrich Corp. |
|
| 11,800 |
|
| 968,426 |
|
United Technologies Corp. |
|
| 25,200 |
|
| 1,884,204 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 2,852,630 |
|
|
|
|
|
|
| ||
Air Freight & Logistics – 1.1% |
|
|
|
|
|
|
|
C.H. Robinson Worldwide, Inc. |
|
| 16,100 |
|
| 1,134,728 |
|
|
|
|
|
|
| ||
Auto Components – 0.5% |
|
|
|
|
|
|
|
BorgWarner, Inc. (a) |
|
| 9,700 |
|
| 544,267 |
|
|
|
|
|
|
| ||
Beverages – 1.0% |
|
|
|
|
|
|
|
PepsiCo, Inc. |
|
| 14,800 |
|
| 966,440 |
|
|
|
|
|
|
| ||
Biotechnology – 1.0% |
|
|
|
|
|
|
|
Celgene Corp. (a) |
|
| 16,700 |
|
| 1,036,569 |
|
|
|
|
|
|
| ||
Capital Markets – 5.4% |
|
|
|
|
|
|
|
Franklin Resources, Inc. |
|
| 13,200 |
|
| 1,514,040 |
|
Goldman Sachs Group, Inc. |
|
| 18,100 |
|
| 2,913,195 |
|
TD AMERITRADE Holding Corp. (a) |
|
| 52,000 |
|
| 888,680 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 5,315,915 |
|
|
|
|
|
|
| ||
Chemicals – 0.9% |
|
|
|
|
|
|
|
Ecolab, Inc. |
|
| 17,900 |
|
| 882,828 |
|
|
|
|
|
|
| ||
Communications Equipment – 5.8% |
|
|
|
|
|
|
|
Cisco Systems, Inc. (a) |
|
| 91,600 |
|
| 2,091,228 |
|
Juniper Networks, Inc. (a) |
|
| 21,700 |
|
| 702,863 |
|
QUALCOMM, Inc. |
|
| 64,100 |
|
| 2,892,833 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 5,686,924 |
|
|
|
|
|
|
| ||
Computers & Peripherals – 8.6% |
|
|
|
|
|
|
|
Apple, Inc. (a) |
|
| 16,480 |
|
| 4,958,338 |
|
EMC Corp. (a) |
|
| 109,200 |
|
| 2,294,292 |
|
NetApp, Inc. (a) |
|
| 22,700 |
|
| 1,208,775 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 8,461,405 |
|
|
|
|
|
|
| ||
Construction & Engineering – 1.4% |
|
|
|
|
|
|
|
Fluor Corp. |
|
| 28,600 |
|
| 1,378,234 |
|
|
|
|
|
|
| ||
Diversified Financial Services – 3.5% |
|
|
|
|
|
|
|
CME Group, Inc. |
|
| 3,700 |
|
| 1,071,705 |
|
IntercontinentalExchange, Inc. (a) |
|
| 7,700 |
|
| 884,499 |
|
JP Morgan Chase & Co. |
|
| 40,100 |
|
| 1,508,963 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 3,465,167 |
|
|
|
|
|
|
| ||
Electronic Equipment, Instruments & Components – 2.0% |
|
|
|
|
|
|
|
Agilent Technologies, Inc. (a) |
|
| 27,200 |
|
| 946,560 |
|
Amphenol Corp., Class A |
|
| 20,100 |
|
| 1,007,613 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 1,954,173 |
|
|
|
|
|
|
| ||
Energy Equipment & Services – 4.2% |
|
|
|
|
|
|
|
FMC Technologies, Inc. (a) |
|
| 25,700 |
|
| 1,852,970 |
|
Schlumberger Ltd. |
|
| 33,200 |
|
| 2,320,348 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 4,173,318 |
|
|
|
|
|
|
| ||
Financial Services – 2.8% |
|
|
|
|
|
|
|
Visa, Inc., Class A |
|
| 35,800 |
|
| 2,798,486 |
|
|
|
|
|
|
| ||
Food & Staples Retailing – 1.0% |
|
|
|
|
|
|
|
Costco Wholesale Corp. |
|
| 15,100 |
|
| 947,827 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Stocks, continued |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
Food Products – 0.9% |
|
|
|
|
|
|
|
Green Mountain Coffee Roasters, Inc. (a) |
|
| 25,600 |
|
| 844,544 |
|
|
|
|
|
|
| ||
Health Care Equipment & Supplies – 0.8% |
|
|
|
|
|
|
|
Varian Medical Systems, Inc. (a) |
|
| 13,000 |
|
| 821,860 |
|
|
|
|
|
|
| ||
Health Care Providers & Services – 2.8% |
|
|
|
|
|
|
|
Express Scripts, Inc. (a) |
|
| 56,300 |
|
| 2,731,676 |
|
|
|
|
|
|
| ||
Health Care Technology – 1.1% |
|
|
|
|
|
|
|
Cerner Corp. (a) |
|
| 11,900 |
|
| 1,045,177 |
|
|
|
|
|
|
| ||
Hotels, Restaurants & Leisure – 2.2% |
|
|
|
|
|
|
|
Ctrip.com International Ltd. ADR (a) |
|
| 20,400 |
|
| 1,062,228 |
|
Yum! Brands, Inc. |
|
| 22,900 |
|
| 1,134,924 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 2,197,152 |
|
|
|
|
|
|
| ||
Internet & Catalog Retail – 6.5% |
|
|
|
|
|
|
|
Amazon.com, Inc. (a) |
|
| 14,500 |
|
| 2,394,530 |
|
Netflix, Inc. (a) |
|
| 3,400 |
|
| 589,900 |
|
Priceline.com, Inc. (a) |
|
| 9,000 |
|
| 3,391,290 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 6,375,720 |
|
|
|
|
|
|
| ||
Internet Software & Services – 4.7% |
|
|
|
|
|
|
|
Baidu, Inc. ADR (a) |
|
| 15,650 |
|
| 1,721,657 |
|
Google, Inc., Class A (a) |
|
| 4,850 |
|
| 2,973,001 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 4,694,658 |
|
|
|
|
|
|
| ||
IT Services – 4.1% |
|
|
|
|
|
|
|
Cognizant Technology Solutions Corp. (a) |
|
| 61,600 |
|
| 4,015,704 |
|
|
|
|
|
|
| ||
Machinery – 6.0% |
|
|
|
|
|
|
|
Danaher Corp. |
|
| 58,800 |
|
| 2,549,568 |
|
Deere & Co. |
|
| 22,600 |
|
| 1,735,680 |
|
Illinois Tool Works, Inc. |
|
| 35,500 |
|
| 1,622,350 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 5,907,598 |
|
|
|
|
|
|
| ||
Media – 0.5% |
|
|
|
|
|
|
|
Scripps Networks Interactive, Class A |
|
| 9,900 |
|
| 503,811 |
|
|
|
|
|
|
| ||
Metals & Mining – 2.8% |
|
|
|
|
|
|
|
Cliffs Natural Resources, Inc. |
|
| 26,900 |
|
| 1,753,880 |
|
Walter Energy, Inc. |
|
| 11,700 |
|
| 1,029,132 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 2,783,012 |
|
|
|
|
|
|
| ||
Multiline Retail – 1.5% |
|
|
|
|
|
|
|
Kohl’s Corp. (a) |
|
| 29,400 |
|
| 1,505,280 |
|
|
|
|
|
|
| ||
Oil, Gas & Consumable Fuels – 2.0% |
|
|
|
|
|
|
|
Peabody Energy Corp. |
|
| 19,000 |
|
| 1,005,100 |
|
Petroleo Brasileiro SA ADR |
|
| 31,200 |
|
| 973,128 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 1,978,228 |
|
|
|
|
|
|
| ||
Personal Products – 1.0% |
|
|
|
|
|
|
|
The Estee Lauder Cos., Inc., Class A |
|
| 14,600 |
|
| 1,039,082 |
|
|
|
|
|
|
| ||
Pharmaceuticals – 2.9% |
|
|
|
|
|
|
|
Shire plc ADR |
|
| 20,900 |
|
| 1,465,090 |
|
Teva Pharmaceutical Industries Ltd. ADR |
|
| 26,400 |
|
| 1,370,160 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 2,835,250 |
|
|
|
|
|
|
| ||
Road & Rail – 3.0% |
|
|
|
|
|
|
|
Union Pacific Corp. |
|
| 34,200 |
|
| 2,998,656 |
|
|
|
|
|
|
|
|
|
|
See notes to financial statements. | HSBC INVESTOR PORTFOLIOS | 40 |
|
HSBC INVESTOR GROWTH PORTFOLIO |
Schedule of Portfolio Investments—as of October 31, 2010 (continued) |
|
|
|
|
|
|
|
|
Common Stocks, continued | |||||||
|
|
|
|
|
|
|
|
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
Semiconductors & Semiconductor Equipment – 1.1% |
|
|
|
|
|
|
|
Texas Instruments, Inc. |
|
| 38,300 |
|
| 1,132,531 |
|
|
|
|
|
|
| ||
Software – 7.0% |
|
|
|
|
|
|
|
Autodesk, Inc. (a) |
|
| 39,700 |
|
| 1,436,346 |
|
Citrix Systems, Inc. (a) |
|
| 27,100 |
|
| 1,736,297 |
|
Intuit, Inc. (a) |
|
| 13,200 |
|
| 633,600 |
|
Oracle Corp. |
|
| 106,200 |
|
| 3,122,280 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 6,928,523 |
|
|
|
|
|
|
| ||
Specialty Retail – 2.3% |
|
|
|
|
|
|
|
Dick’s Sporting Goods, Inc. (a) |
|
| 17,500 |
|
| 504,350 |
|
O’Reilly Automotive, Inc. (a) |
|
| 22,300 |
|
| 1,304,550 |
|
Urban Outfitters, Inc. (a) |
|
| 13,600 |
|
| 418,472 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 2,227,372 |
|
|
|
|
|
|
| ||
Textiles, Apparel & Luxury Goods – 1.0% |
|
|
|
|
|
|
|
Nike, Inc., Class B |
|
| 11,600 |
|
| 944,704 |
|
|
|
|
|
|
| ||
Wireless Telecommunication Services – 1.8% |
|
|
|
|
|
|
|
American Tower Corp., Class A (a) |
|
| 33,600 |
|
| 1,734,096 |
|
|
|
|
|
|
| ||
TOTAL COMMON STOCKS |
|
|
|
|
| 96,843,545 |
|
|
|
|
|
|
| ||
| |||||||
Investment Company—1.3% |
|
|
|
|
|
|
|
Northern Institutional Diversified Assets |
|
| 1,314,150 |
|
| 1,314,150 |
|
|
|
|
|
|
| ||
TOTAL INVESTMENT COMPANY |
|
|
|
|
| 1,314,150 |
|
|
|
|
|
|
| ||
TOTAL INVESTMENTS |
|
|
|
|
| 98,157,695 |
|
|
|
|
|
|
|
|
|
|
| ||
| Percentages indicated are based on net assets of $98,750,801. | |
| ||
ADR —American Depositary Receipt | ||
plc —Public Limited Company | ||
|
|
|
(a) | Represents non-income producing security. | |
|
|
|
(b) | The rate represents the annualized one-day yield that was in effect on October 31, 2010. |
|
|
|
41 | HSBC INVESTOR PORTFOLIOS | See notes to financial statements. |
|
Schedule of Portfolio Investments—as of October 31, 2010 |
|
|
|
|
|
|
|
|
Common Stocks—96.8% | |||||||
| |||||||
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
Australia – 3.9% |
|
|
|
|
|
|
|
Australia & New Zealand Banking Group Ltd. |
|
| 9,000 |
|
| 218,667 |
|
Boral Ltd. |
|
| 51,520 |
|
| 221,491 |
|
Incitec Pivot Ltd. |
|
| 46,600 |
|
| 169,763 |
|
National Australia Bank Ltd. |
|
| 33,165 |
|
| 826,900 |
|
Telstra Corp. Ltd. (a) |
|
| 70,200 |
|
| 183,554 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 1,620,375 |
|
|
|
|
|
|
| ||
Austria – 0.8% |
|
|
|
|
|
|
|
OMV AG |
|
| 8,600 |
|
| 321,273 |
|
|
|
|
|
|
| ||
Belgium – 1.3% |
|
|
|
|
|
|
|
Delhaize Group SA |
|
| 5,634 |
|
| 393,502 |
|
KBC Groep NV (b) |
|
| 3,300 |
|
| 143,531 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 537,033 |
|
|
|
|
|
|
| ||
Brazil – 1.3% |
|
|
|
|
|
|
|
Banco Do Brasil SA |
|
| 11,100 |
|
| 214,948 |
|
Vale SA, Preferred ADR |
|
| 10,900 |
|
| 313,157 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 528,105 |
|
|
|
|
|
|
| ||
Canada – 4.8% |
|
|
|
|
|
|
|
Agrium, Inc. |
|
| 1,900 |
|
| 168,123 |
|
Lundin Mining Corp. (b) |
|
| 45,600 |
|
| 288,913 |
|
National Bank of Canada |
|
| 5,900 |
|
| 388,453 |
|
Nexen, Inc. |
|
| 17,727 |
|
| 377,281 |
|
Penn West Energy Trust |
|
| 20,523 |
|
| 467,585 |
|
Suncor Energy, Inc. |
|
| 10,428 |
|
| 334,236 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 2,024,591 |
|
|
|
|
|
|
| ||
China – 0.4% |
|
|
|
|
|
|
|
China Petroleum & Chemical Corp. |
|
| 170,000 |
|
| 160,328 |
|
|
|
|
|
|
| ||
Denmark – 1.2% |
|
|
|
|
|
|
|
Danske Bank A/S (b) |
|
| 18,800 |
|
| 500,075 |
|
|
|
|
|
|
| ||
France – 14.7% |
|
|
|
|
|
|
|
Arkema |
|
| 4,200 |
|
| 271,369 |
|
BNP Paribas SA |
|
| 8,986 |
|
| 657,131 |
|
Bouygues SA |
|
| 12,600 |
|
| 555,217 |
|
Cap Gemini SA |
|
| 7,900 |
|
| 402,970 |
|
Compagnie Generale de Geophysique- |
|
| 7,000 |
|
| 163,165 |
|
Electricite de France |
|
| 9,500 |
|
| 435,274 |
|
France Telecom SA |
|
| 25,200 |
|
| 605,452 |
|
Lagardere S.C.A. |
|
| 10,300 |
|
| 439,248 |
|
PPR |
|
| 1,300 |
|
| 213,109 |
|
Renault SA (b) |
|
| 6,300 |
|
| 350,024 |
|
Sanofi-Aventis |
|
| 9,400 |
|
| 656,404 |
|
Societe Generale |
|
| 8,581 |
|
| 513,773 |
|
Vallourec SA |
|
| 2,234 |
|
| 231,825 |
|
Vivendi |
|
| 22,220 |
|
| 633,731 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 6,128,692 |
|
|
|
|
|
|
| ||
Germany – 8.0% |
|
|
|
|
|
|
|
Allianz SE |
|
| 5,800 |
|
| 726,816 |
|
Bayer AG |
|
| 10,200 |
|
| 765,071 |
|
Deutsche Bank AG |
|
| 6,800 |
|
| 393,843 |
|
E.ON AG |
|
| 20,200 |
|
| 633,604 |
|
|
|
|
|
|
|
|
|
Common Stocks, continued |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
Germany, continued |
|
|
|
|
|
|
|
Muenchener Rueckversicherungs- |
|
| 2,100 |
|
| 328,034 |
|
Thyssenkrupp AG |
|
| 13,700 |
|
| 503,598 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 3,350,966 |
|
|
|
|
|
|
| ||
Hong Kong – 1.5% |
|
|
|
|
|
|
|
Esprit Holdings Ltd. |
|
| 57,577 |
|
| 310,133 |
|
New World Development Co. Ltd. |
|
| 160,009 |
|
| 315,848 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 625,981 |
|
|
|
|
|
|
| ||
Italy – 4.5% |
|
|
|
|
|
|
|
ENI SpA |
|
| 25,200 |
|
| 567,754 |
|
Telecom Italia RSP |
|
| 204,200 |
|
| 250,064 |
|
Telecom Italia SpA |
|
| 286,200 |
|
| 438,899 |
|
UniCredit SpA |
|
| 232,800 |
|
| 606,783 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 1,863,500 |
|
|
|
|
|
|
| ||
Japan – 23.0% |
|
|
|
|
|
|
|
AEON Co. Ltd. |
|
| 18,100 |
|
| 213,285 |
|
Air Water, Inc. |
|
| 5,800 |
|
| 67,697 |
|
Asahi Breweries Ltd. |
|
| 16,200 |
|
| 327,222 |
|
Asahi Glass Co. Ltd. |
|
| 9,000 |
|
| 86,476 |
|
DIC Corp. |
|
| 59,000 |
|
| 110,006 |
|
Dowa Holdings Co. Ltd. |
|
| 19,800 |
|
| 120,351 |
|
East Japan Railway Co. |
|
| 2,600 |
|
| 160,783 |
|
ITOCHU Corp. |
|
| 39,700 |
|
| 348,393 |
|
Japan Tobacco, Inc. |
|
| 179 |
|
| 556,914 |
|
JFE Holdings, Inc. |
|
| 9,700 |
|
| 302,876 |
|
JX Holdings, Inc. |
|
| 41,500 |
|
| 243,996 |
|
KDDI Corp. |
|
| 62 |
|
| 334,083 |
|
KONAMI Corp. |
|
| 6,300 |
|
| 111,043 |
|
Konica Minolta Holdings, Inc. |
|
| 10,700 |
|
| 103,742 |
|
Mitsubishi Corp. |
|
| 24,600 |
|
| 591,684 |
|
Mitsubishi Materials Corp. (b) |
|
| 54,400 |
|
| 170,402 |
|
Mitsui & Co. Ltd. |
|
| 33,000 |
|
| 518,894 |
|
Mitsui Fudosan Co. Ltd. |
|
| 31,600 |
|
| 597,434 |
|
NAMCO BANDAI Holdings, Inc. |
|
| 20,600 |
|
| 189,996 |
|
NGK Spark Plug Co. Ltd. |
|
| 14,600 |
|
| 203,620 |
|
Nippon Express Co. Ltd. |
|
| 33,000 |
|
| 131,262 |
|
Nippon Telegraph & Telephone Corp. |
|
| 14,000 |
|
| 636,047 |
|
Nissan Motor Co. Ltd. |
|
| 53,900 |
|
| 475,687 |
|
Sharp Corp. |
|
| 39,800 |
|
| 393,300 |
|
Sony Corp. |
|
| 16,910 |
|
| 565,418 |
|
Sumitomo Electric Industries Ltd. |
|
| 21,500 |
|
| 274,462 |
|
Sumitomo Mitsui Financial Group, Inc. |
|
| 15,500 |
|
| 464,711 |
|
Sumitomo Realty & Development Co. Ltd. |
|
| 6,000 |
|
| 130,814 |
|
Sumitomo Rubber Industries Ltd. |
|
| 6,200 |
|
| 66,817 |
|
The Tokyo Electric Power Co., Inc. |
|
| 19,600 |
|
| 468,987 |
|
Tokyo Gas Co. Ltd. |
|
| 49,000 |
|
| 230,839 |
|
Toshiba Corp. |
|
| 86,900 |
|
| 435,310 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 9,632,551 |
|
|
|
|
|
|
| ||
Kazakhstan – 0.3% |
|
|
|
|
|
|
|
KazMunaiGas Exploration Production GDR |
|
| 7,050 |
|
| 121,260 |
|
|
|
|
|
|
|
|
|
|
See notes to financial statements. | HSBC INVESTOR PORTFOLIOS | 42 |
|
HSBC INVESTOR INTERNATIONAL EQUITY PORTFOLIO |
Schedule of Portfolio Investments—as of October 31, 2010 (continued) |
|
|
|
|
|
|
|
|
Common Stocks, continued |
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
Netherlands – 1.3% |
|
|
|
|
|
|
|
Koninklijke Ahold NV |
|
| 10,800 |
|
| 149,240 |
|
Randstad Holding NV (b) |
|
| 8,593 |
|
| 408,963 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 558,203 |
|
|
|
|
|
|
| ||
Norway – 0.4% |
|
|
|
|
|
|
|
Petroleum Geo-Services ASA (b) |
|
| 12,150 |
|
| 151,940 |
|
|
|
|
|
|
| ||
Russian Federation – 0.3% |
|
|
|
|
|
|
|
Gazprom OAO ADR |
|
| 5,600 |
|
| 122,752 |
|
|
|
|
|
|
| ||
South Korea – 1.4% |
|
|
|
|
|
|
|
Hana Financial Group, Inc. |
|
| 4,400 |
|
| 124,949 |
|
KB Financial Group, Inc. ADR |
|
| 3,679 |
|
| 165,187 |
|
Samsung Electronics Co. Ltd., Preferred |
|
| 600 |
|
| 294,907 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 585,043 |
|
|
|
|
|
|
| ||
Spain – 1.0% |
|
|
|
|
|
|
|
Telefonica SA |
|
| 16,200 |
|
| 437,350 |
|
|
|
|
|
|
| ||
Switzerland – 2.3% |
|
|
|
|
|
|
|
Novartis AG |
|
| 14,240 |
|
| 825,770 |
|
UBS AG (b) |
|
| 8,783 |
|
| 148,734 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 974,504 |
|
|
|
|
|
|
| ||
Taiwan – 0.6% |
|
|
|
|
|
|
|
AU Optronics Corp. (b) |
|
| 210,030 |
|
| 209,598 |
|
United Microelectronics Corp. |
|
| 118,000 |
|
| 56,084 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 265,682 |
|
|
|
|
|
|
| ||
Turkey – 0.8% |
|
|
|
|
|
|
|
Turkiye Garanti Bankasi AS |
|
| 30,900 |
|
| 189,623 |
|
Turkiye Is Bankasi AS, Class C |
|
| 32,000 |
|
| 143,933 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 333,556 |
|
|
|
|
|
|
| ||
United Kingdom – 23.0% |
|
|
|
|
|
|
|
AstraZeneca plc |
|
| 17,300 |
|
| 867,384 |
|
Aviva plc |
|
| 64,400 |
|
| 410,741 |
|
BAE Systems plc |
|
| 82,300 |
|
| 454,497 |
|
Barclays plc |
|
| 122,900 |
|
| 540,683 |
|
BP plc |
|
| 101,900 |
|
| 695,136 |
|
British American Tobacco plc |
|
| 5,400 |
|
| 205,902 |
|
FirstGroup plc |
|
| 29,600 |
|
| 193,435 |
|
Imperial Tobacco Group plc |
|
| 18,000 |
|
| 576,468 |
|
Inchcape plc (b) |
|
| 27,440 |
|
| 153,294 |
|
Informa plc |
|
| 20,900 |
|
| 145,990 |
|
Marks & Spencer Group plc |
|
| 82,200 |
|
| 562,855 |
|
Old Mutual plc |
|
| 257,800 |
|
| 536,516 |
|
Rentokil Initial plc (b) |
|
| 60,700 |
|
| 96,372 |
|
Rio Tinto plc |
|
| 14,000 |
|
| 905,252 |
|
Royal Dutch Shell plc, A Shares |
|
| 44,687 |
|
| 1,449,249 |
|
Thomas Cook Group plc |
|
| 39,000 |
|
| 113,030 |
|
Tui Travel plc |
|
| 46,300 |
|
| 156,588 |
|
Vodafone Group plc |
|
| 351,058 |
|
| 955,289 |
|
Xstrata plc |
|
| 30,940 |
|
| 599,538 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 9,618,219 |
|
|
|
|
|
|
| ||
TOTAL COMMON STOCKS |
|
|
|
|
| 40,461,979 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment Company—0.9% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Shares |
|
| Value($) |
|
|
|
|
|
|
| ||
Northern Institutional Diversified Assets |
|
| 391,214 |
|
| 391,214 |
|
|
|
|
|
|
| ||
TOTAL INVESTMENT COMPANY |
|
|
|
|
| 391,214 |
|
|
|
|
|
|
| ||
TOTAL INVESTMENTS |
|
|
|
|
| 40,853,193 |
|
|
|
|
|
|
|
|
|
|
| ||
| Percentages indicated are based on net assets of $41,817,594. | |
|
| |
ADR —American Depositary Receipt | ||
GDR —Global Depositary Receipt | ||
plc —Public Limited Company | ||
|
|
|
(a) | Rule 144A security or other security which is restricted as to resale to institutional investors. This security has been deemed liquid by the Investment Adviser based on procedures approved by the Board of Trustees. | |
|
| |
(b) | Represents non-income producing security. | |
|
| |
(c) | The rate represents the annualized one-day yield that was in effect on October 31, 2010. |
|
Schedule of Portfolio Investments—October 31, 2010 |
The Portfolio invested, as a percentage of net assets, in the following industries, as of October 31, 2010:
|
|
|
|
|
Industry |
| Percent of Net Assets |
| |
|
| |||
Commercial Banks |
| 13.4 | % |
|
Oil, Gas & Consumable Fuels |
| 11.8 | % |
|
Metals & Mining |
| 8.8 | % |
|
Pharmaceuticals |
| 7.6 | % |
|
Diversified Telecommunication Services |
| 6.3 | % |
|
Insurance |
| 3.9 | % |
|
Electric Utilities |
| 3.7 | % |
|
Trading Companies & Distributors |
| 3.5 | % |
|
Tobacco |
| 3.3 | % |
|
Media |
| 3.1 | % |
|
Wireless Telecommunication Services |
| 3.1 | % |
|
Real Estate Management & Development |
| 2.6 | % |
|
Household Durables |
| 2.4 | % |
|
Automobiles |
| 2.1 | % |
|
Food & Staples Retailing |
| 1.9 | % |
|
Multiline Retail |
| 1.9 | % |
|
Chemicals |
| 1.6 | % |
|
Capital Markets |
| 1.4 | % |
|
Construction & Engineering |
| 1.4 | % |
|
Air Freight & Logistics |
| 1.4 | % |
|
Computers & Peripherals |
| 1.1 | % |
|
Investment Companies |
| 1.0 | % |
|
IT Services |
| 1.0 | % |
|
Professional Services |
| 1.0 | % |
|
Road & Rail |
| 0.9 | % |
|
Beverages |
| 0.8 | % |
|
Energy Equipment & Services |
| 0.8 | % |
|
Semiconductors & Semiconductor Equipment |
| 0.8 | % |
|
Auto Components |
| 0.7 | % |
|
Electrical Equipment |
| 0.7 | % |
|
Hotels, Restaurants & Leisure |
| 0.7 | % |
|
Specialty Retail |
| 0.7 | % |
|
Machinery |
| 0.6 | % |
|
Commercial Services & Supplies |
| 0.5 | % |
|
Construction Materials |
| 0.5 | % |
|
Electronic Equipment, Instruments & Components |
| 0.5 | % |
|
Gas Utilities |
| 0.5 | % |
|
Leisure Equipment & Products |
| 0.5 | % |
|
Distributors |
| 0.4 | % |
|
Diversified Financial Services |
| 0.4 | % |
|
Software |
| 0.3 | % |
|
Building Products |
| 0.2 | % |
|
Office Electronics |
| 0.2 | % |
|
|
|
| ||
Total Investments |
| 100.0 | % |
|
|
|
|
|
|
|
43 | HSBC INVESTOR PORTFOLIOS | See notes to financial statements. |
|
Schedule of Portfolio Investments—as of October 31, 2010 |
|
|
|
|
|
|
|
|
Common Stocks—97.1% |
|
|
|
|
|
|
|
| |||||||
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
Aerospace & Defense – 2.2% |
|
|
|
|
|
|
|
BE Aerospace, Inc. (a) |
|
| 84,600 |
|
| 3,109,896 |
|
|
|
|
|
|
| ||
Auto Components – 3.3% |
|
|
|
|
|
|
|
Gentex Corp. |
|
| 125,800 |
|
| 2,513,484 |
|
The Goodyear Tire & Rubber Co. (a) |
|
| 210,800 |
|
| 2,154,376 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 4,667,860 |
|
|
|
|
|
|
| ||
Biotechnology – 2.9% |
|
|
|
|
|
|
|
Alexion Pharmaceuticals, Inc. (a) |
|
| 59,800 |
|
| 4,084,340 |
|
|
|
|
|
|
| ||
Capital Markets – 1.8% |
|
|
|
|
|
|
|
Waddell & Reed Financial, Inc., Class A |
|
| 87,900 |
|
| 2,555,253 |
|
|
|
|
|
|
| ||
Chemicals – 2.3% |
|
|
|
|
|
|
|
Celanese Corp., Series A |
|
| 89,600 |
|
| 3,194,240 |
|
|
|
|
|
|
| ||
Commercial Banks – 1.0% |
|
|
|
|
|
|
|
First Horizon National Corp. (a) |
|
| 1 |
|
| 10 |
|
Huntington Bancshares, Inc. |
|
| 247,500 |
|
| 1,403,325 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 1,403,335 |
|
|
|
|
|
|
| ||
Commercial Services & Supplies – 3.0% |
|
|
|
|
|
|
|
Hertz Global Holdings, Inc. (a) |
|
| 178,900 |
|
| 2,025,148 |
|
Waste Connections, Inc. |
|
| 52,450 |
|
| 2,136,813 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 4,161,961 |
|
|
|
|
|
|
| ||
Communications Equipment – 2.0% |
|
|
|
|
|
|
|
Brocade Communications Systems, Inc. (a) |
|
| 430,000 |
|
| 2,717,600 |
|
|
|
|
|
|
| ||
Containers & Packaging – 2.3% |
|
|
|
|
|
|
|
Crown Holdings, Inc. (a) |
|
| 100,800 |
|
| 3,244,752 |
|
|
|
|
|
|
| ||
Diversified Consumer Services – 0.4% |
|
|
|
|
|
|
|
New Oriental Education & Technology Group, Inc. ADR (a) |
|
| 5,200 |
|
| 558,324 |
|
|
|
|
|
|
| ||
Diversified Financial Services – 1.6% |
|
|
|
|
|
|
|
MSCI, Inc., Class A (a) |
|
| 60,800 |
|
| 2,179,680 |
|
|
|
|
|
|
| ||
Electrical Equipment – 2.1% |
|
|
|
|
|
|
|
AMETEK, Inc. |
|
| 53,100 |
|
| 2,870,055 |
|
|
|
|
|
|
| ||
Energy Equipment & Services – 1.3% |
|
|
|
|
|
|
|
Exterran Holdings, Inc. (a) |
|
| 70,000 |
|
| 1,761,900 |
|
|
|
|
|
|
| ||
Food Products – 3.1% |
|
|
|
|
|
|
|
Green Mountain Coffee Roasters, Inc. (a) |
|
| 45,100 |
|
| 1,487,849 |
|
Ralcorp Holdings, Inc. (a) |
|
| 45,450 |
|
| 2,820,627 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 4,308,476 |
|
|
|
|
|
|
| ||
Health Care Equipment & Supplies – 3.7% |
|
|
|
|
|
|
|
Hill-Rom Holdings, Inc. |
|
| 84,150 |
|
| 3,260,812 |
|
IDEXX Laboratories, Inc. (a) |
|
| 31,050 |
|
| 1,861,758 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 5,122,570 |
|
|
|
|
|
|
| ||
Health Care Providers & Services – 3.2% |
|
|
|
|
|
|
|
Community Health Systems, Inc. (a) |
|
| 60,450 |
|
| 1,818,336 |
|
Coventry Health Care, Inc. (a) |
|
| 89,200 |
|
| 2,089,064 |
|
Skilled Healthcare Group, Inc., Class A (a) |
|
| 146,700 |
|
| 550,125 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 4,457,525 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Stocks, continued |
|
|
|
|
|
|
|
| |||||||
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
Hotels, Restaurants & Leisure – 4.7% |
|
|
|
|
|
|
|
Ctrip.com International Ltd. ADR (a) |
|
| 59,600 |
|
| 3,103,372 |
|
Scientific Games Corp., Class A (a) |
|
| 176,700 |
|
| 1,395,930 |
|
WMS Industries, Inc. (a) |
|
| 48,350 |
|
| 2,109,510 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 6,608,812 |
|
|
|
|
|
|
| ||
Household Products – 1.5% |
|
|
|
|
|
|
|
Church & Dwight Co., Inc. |
|
| 32,300 |
|
| 2,126,955 |
|
|
|
|
|
|
| ||
Internet Software & Services – 2.2% |
|
|
|
|
|
|
|
VeriSign, Inc. (a) |
|
| 86,200 |
|
| 2,995,450 |
|
|
|
|
|
|
| ||
IT Services – 1.6% |
|
|
|
|
|
|
|
Alliance Data Systems Corp. (a) |
|
| 37,600 |
|
| 2,283,072 |
|
|
|
|
|
|
| ||
Life Sciences Tools & Services – 4.5% |
|
|
|
|
|
|
|
Illumina, Inc. (a) |
|
| 31,250 |
|
| 1,697,188 |
|
Life Technologies Corp. (a) |
|
| 49,600 |
|
| 2,488,928 |
|
Mettler-Toledo International, Inc. (a) |
|
| 15,570 |
|
| 2,032,819 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 6,218,935 |
|
|
|
|
|
|
| ||
Machinery – 5.1% |
|
|
|
|
|
|
|
Crane Co. |
|
| 60,000 |
|
| 2,295,600 |
|
IDEX Corp. |
|
| 72,100 |
|
| 2,601,368 |
|
Snap-on, Inc. |
|
| 42,050 |
|
| 2,144,550 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 7,041,518 |
|
|
|
|
|
|
| ||
Media – 2.5% |
|
|
|
|
|
|
|
DreamWorks Animation SKG, Inc. (a) |
|
| 57,900 |
|
| 2,043,870 |
|
Lamar Advertising Co. (a) |
|
| 40,400 |
|
| 1,373,196 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 3,417,066 |
|
|
|
|
|
|
| ||
Metals & Mining – 2.0% |
|
|
|
|
|
|
|
Compass Minerals International, Inc. |
|
| 35,630 |
|
| 2,810,138 |
|
|
|
|
|
|
| ||
Oil, Gas & Consumable Fuels – 9.2% |
|
|
|
|
|
|
|
Consol Energy, Inc. |
|
| 83,880 |
|
| 3,083,429 |
|
Denbury Resources, Inc. (a) |
|
| 148,700 |
|
| 2,530,874 |
|
Ensco International plc ADR |
|
| 79,600 |
|
| 3,688,664 |
|
Massey Energy Co. |
|
| 85,000 |
|
| 3,575,950 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 12,878,917 |
|
|
|
|
|
|
| ||
Pharmaceuticals – 2.5% |
|
|
|
|
|
|
|
Elan Corp. plc ADR (a) |
|
| 261,700 |
|
| 1,426,265 |
|
Santarus, Inc. (a) |
|
| 179,200 |
|
| 560,896 |
|
ViroPharma, Inc. (a) |
|
| 88,800 |
|
| 1,452,768 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 3,439,929 |
|
|
|
|
|
|
| ||
Real Estate Investment Trusts (REITs) – 1.8% |
|
|
|
|
|
|
|
Hospitality Properties Trust |
|
| 112,900 |
|
| 2,575,249 |
|
|
|
|
|
|
| ||
Road & Rail – 1.7% |
|
|
|
|
|
|
|
Landstar System, Inc. |
|
| 61,650 |
|
| 2,319,273 |
|
|
|
|
|
|
| ||
Semiconductors & Semiconductor Equipment – 6.7% |
|
|
|
|
|
|
|
Lam Research Corp. (a) |
|
| 32,900 |
|
| 1,506,491 |
|
LSI Corp. (a) |
|
| 418,300 |
|
| 2,191,892 |
|
NXP Semiconductors N.V. (a) |
|
| 107,500 |
|
| 1,417,925 |
|
ON Semiconductor Corp. (a) |
|
| 353,300 |
|
| 2,709,811 |
|
Skyworks Solutions, Inc. (a) |
|
| 67,100 |
|
| 1,537,261 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 9,363,380 |
|
|
|
|
|
|
|
|
|
|
See notes to financial statements. | HSBC INVESTOR PORTFOLIOS | 44 |
|
HSBC INVESTOR OPPORTUNITY PORTFOLIO |
|
Schedule of Portfolio Investments—as of October 31, 2010 (continued) |
|
|
|
|
|
|
|
|
Common Stocks, continued | |||||||
|
|
|
|
|
|
|
|
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
Software – 6.0% |
|
|
|
|
|
|
|
BMC Software, Inc. (a) |
|
| 46,550 |
|
| 2,116,163 |
|
Check Point Software Technologies Ltd. (a) |
|
| 74,750 |
|
| 3,195,562 |
|
Nuance Communications, Inc. (a) |
|
| 192,950 |
|
| 3,031,245 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 8,342,970 |
|
|
|
|
|
|
| ||
Specialty Retail – 3.3% |
|
|
|
|
|
|
|
Hibbett Sports, Inc. (a) |
|
| 77,950 |
|
| 2,100,753 |
|
O’Reilly Automotive, Inc. (a) |
|
| 42,750 |
|
| 2,500,875 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 4,601,628 |
|
|
|
|
|
|
| ||
Textiles, Apparel & Luxury Goods – 2.1% |
|
|
|
|
|
|
|
Fossil, Inc. (a) |
|
| 50,000 |
|
| 2,949,500 |
|
|
|
|
|
|
| ||
Trading Companies & Distributors – 1.4% |
|
|
|
|
|
|
|
WESCO International, Inc. (a) |
|
| 45,850 |
|
| 1,963,297 |
|
|
|
|
|
|
| ||
Wireless Telecommunication Services – 2.1% |
|
|
|
|
|
|
|
NII Holdings, Inc. (a) |
|
| 71,500 |
|
| 2,989,415 |
|
|
|
|
|
|
| ||
TOTAL COMMON STOCKS |
|
|
|
|
| 135,323,271 |
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
Investment Company—2.8% |
|
|
|
|
|
|
|
Northern Institutional Government Select |
|
| 3,971,916 |
|
| 3,971,916 |
|
|
|
|
|
|
| ||
TOTAL INVESTMENT COMPANY |
|
|
|
|
| 3,971,916 |
|
|
|
|
|
|
| ||
TOTAL INVESTMENTS |
|
|
|
|
| 139,295,187 |
|
|
|
|
|
|
|
|
|
|
| ||
| Percentages indicated are based on net assets of $139,401,552. | |
| ||
ADR — American Depositary Receipt | ||
plc — Public Limited Company | ||
|
|
|
(a) | Represents non-income producing security. | |
|
|
|
(b) | The rate represents the annualized one-day yield that was in effect on October 31, 2010. |
|
|
|
45 | HSBC INVESTOR PORTFOLIOS | See notes to financial statements. |
|
|
Schedule of Portfolio Investments—as of October 31, 2010 |
|
|
|
|
|
|
|
|
Common Stocks—94.2% | |||||||
|
|
|
|
|
|
|
|
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
Aerospace & Defense – 3.7% |
|
|
|
|
|
|
|
Lockheed Martin Corp. |
|
| 18,400 |
|
| 1,311,736 |
|
Raytheon Co. |
|
| 13,400 |
|
| 617,472 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 1,929,208 |
|
|
|
|
|
|
| ||
Biotechnology – 4.3% |
|
|
|
|
|
|
|
Amgen, Inc. (a) |
|
| 39,000 |
|
| 2,230,410 |
|
|
|
|
|
|
| ||
Capital Markets – 1.0% |
|
|
|
|
|
|
|
Goldman Sachs Group, Inc. |
|
| 3,200 |
|
| 515,040 |
|
|
|
|
|
|
| ||
Commercial Banks – 2.2% |
|
|
|
|
|
|
|
Wells Fargo & Co. |
|
| 42,700 |
|
| 1,113,616 |
|
|
|
|
|
|
| ||
Commercial Services & Supplies – 1.7% |
|
|
|
|
|
|
|
Pitney Bowes, Inc. |
|
| 39,500 |
|
| 866,630 |
|
|
|
|
|
|
| ||
Communications Equipment – 4.7% |
|
|
|
|
|
|
|
Motorola, Inc. (a) |
|
| 297,700 |
|
| 2,426,255 |
|
|
|
|
|
|
| ||
Diversified Financial Services – 3.8% |
|
|
|
|
|
|
|
Citigroup, Inc. (a) |
|
| 277,000 |
|
| 1,155,090 |
|
JP Morgan Chase & Co. |
|
| 22,150 |
|
| 833,505 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 1,988,595 |
|
|
|
|
|
|
| ||
Energy Equipment & Services – 1.3% |
|
|
|
|
|
|
|
Halliburton Co. |
|
| 21,500 |
|
| 684,990 |
|
|
|
|
|
|
| ||
Food & Staples Retailing – 2.1% |
|
|
|
|
|
|
|
CVS Caremark Corp. |
|
| 14,800 |
|
| 445,776 |
|
Kroger Co. (The) |
|
| 28,200 |
|
| 620,400 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 1,066,176 |
|
|
|
|
|
|
| ||
Health Care Providers & Services – 1.2% |
|
|
|
|
|
|
|
Aetna, Inc. |
|
| 20,800 |
|
| 621,088 |
|
|
|
|
|
|
| ||
Household Products – 1.3% |
|
|
|
|
|
|
|
Kimberly-Clark Corp. |
|
| 11,000 |
|
| 696,740 |
|
|
|
|
|
|
| ||
Independent Power Producers & |
|
|
|
|
|
|
|
NRG Energy, Inc. (a) |
|
| 33,800 |
|
| 672,958 |
|
|
|
|
|
|
| ||
Insurance – 16.9% |
|
|
|
|
|
|
|
Aon Corp. |
|
| 38,500 |
|
| 1,530,375 |
|
Genworth Financial, Inc., Class A (a) |
|
| 81,300 |
|
| 921,942 |
|
Lincoln National Corp. |
|
| 25,900 |
|
| 634,032 |
|
Loews Corp. |
|
| 41,240 |
|
| 1,628,155 |
|
MetLife, Inc. |
|
| 42,000 |
|
| 1,693,860 |
|
The Hartford Financial Services Group, Inc. |
|
| 43,900 |
|
| 1,052,722 |
|
Unum Group |
|
| 56,100 |
|
| 1,257,762 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 8,718,848 |
|
|
|
|
|
|
| ||
Machinery – 1.8% |
|
|
|
|
|
|
|
Ingersoll-Rand plc |
|
| 23,900 |
|
| 939,509 |
|
|
|
|
|
|
| ||
Media – 6.2% |
|
|
|
|
|
|
|
CBS Corp., Class B |
|
| 11,950 |
|
| 202,313 |
|
Time Warner, Inc. |
|
| 24,900 |
|
| 809,499 |
|
Viacom, Inc., Class B |
|
| 56,500 |
|
| 2,180,335 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 3,192,147 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Stocks, continued | |||||||
|
|
|
|
|
| ||
|
| Shares |
| Value($) |
| ||
|
|
|
| ||||
Metals & Mining – 8.2% |
|
|
|
|
|
|
|
AngloGold Ashanti Ltd. ADR |
|
| 40,727 |
|
| 1,918,649 |
|
Barrick Gold Corp. |
|
| 48,000 |
|
| 2,308,320 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 4,226,969 |
|
|
|
|
|
|
| ||
Oil, Gas & Consumable Fuels – 13.1% |
|
|
|
|
|
|
|
Apache Corp. |
|
| 19,400 |
|
| 1,959,788 |
|
Canadian Natural Resources Ltd. |
|
| 32,000 |
|
| 1,167,040 |
|
Hess Corp. |
|
| 12,100 |
|
| 762,663 |
|
Noble Energy, Inc. |
|
| 13,310 |
|
| 1,084,499 |
|
Occidental Petroleum Corp. |
|
| 12,000 |
|
| 943,560 |
|
Talisman Energy, Inc. |
|
| 46,600 |
|
| 845,324 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 6,762,874 |
|
|
|
|
|
|
| ||
Pharmaceuticals – 8.5% |
|
|
|
|
|
|
|
Merck & Co., Inc. |
|
| 37,600 |
|
| 1,364,128 |
|
Pfizer, Inc. |
|
| 92,000 |
|
| 1,600,800 |
|
Sanofi-Aventis ADR |
|
| 41,500 |
|
| 1,457,065 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 4,421,993 |
|
|
|
|
|
|
| ||
Road & Rail – 1.7% |
|
|
|
|
|
|
|
Union Pacific Corp. |
|
| 10,000 |
|
| 876,800 |
|
|
|
|
|
|
| ||
Software – 7.2% |
|
|
|
|
|
|
|
CA, Inc. |
|
| 112,800 |
|
| 2,618,088 |
|
Microsoft Corp. |
|
| 40,900 |
|
| 1,089,576 |
|
|
|
|
|
|
| ||
|
|
|
|
|
| 3,707,664 |
|
|
|
|
|
|
| ||
Tobacco – 2.0% |
|
|
|
|
|
|
|
Philip Morris International, Inc. |
|
| 18,100 |
|
| 1,058,850 |
|
|
|
|
|
|
| ||
TOTAL COMMON STOCKS |
|
|
|
|
| 48,717,360 |
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
Investment Company—6.5% |
|
|
|
|
|
|
|
Northern Institutional Government Select |
|
| 3,379,613 |
|
| 3,379,613 |
|
|
|
|
|
|
| ||
TOTAL INVESTMENT COMPANY |
|
|
|
|
| 3,379,613 |
|
|
|
|
|
|
| ||
TOTAL INVESTMENTS |
|
|
|
|
| 52,096,973 |
|
|
|
|
|
|
|
|
|
|
| ||
| Percentages indicated are based on net assets of $51,742,652. | |
| ||
ADR — American Depositary Receipt | ||
plc — Public Limited Company | ||
|
|
|
(a) | Represents non-income producing security. | |
|
|
|
(b) | The rate represents the annualized one-day yield that was in effect on October 31, 2010. |
|
|
|
See notes to financial statements. | HSBC INVESTOR PORTFOLIOS | 46 |
|
HSBC INVESTOR PORTFOLIOS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Growth |
| International |
| Opportunity |
| Value |
| ||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments in non-affiliates, at value |
| $ | 98,157,695 |
| $ | 40,853,193 |
| $ | 139,295,187 |
| $ | 52,096,973 |
|
Foreign currency, at value |
|
| — |
|
| 369,458 |
|
| — |
|
| — |
|
Dividends receivable |
|
| 25,966 |
|
| 127,818 |
|
| 79,334 |
|
| 20,518 |
|
Receivable for investments sold |
|
| 1,751,496 |
|
| 587,832 |
|
| 682,522 |
|
| — |
|
Prepaid expenses and other assets |
|
| 103 |
|
| 354 |
|
| 153 |
|
| 60 |
|
|
|
|
|
|
| ||||||||
Total Assets |
|
| 99,935,260 |
|
| 41,938,655 |
|
| 140,057,196 |
|
| 52,117,551 |
|
|
|
|
|
|
| ||||||||
| |||||||||||||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash overdraft |
|
| — |
|
| 1,159 |
|
| — |
|
| — |
|
Payable for investments purchased |
|
| 1,119,622 |
|
| 66,237 |
|
| 539,264 |
|
| 340,035 |
|
Accrued expenses and other liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment Management |
|
| 47,529 |
|
| 31,785 |
|
| 92,434 |
|
| 22,878 |
|
Administration |
|
| 1,938 |
|
| 821 |
|
| 2,718 |
|
| 1,025 |
|
Compliance Services |
|
| 2 |
|
| 1 |
|
| 3 |
|
| 1 |
|
Accounting |
|
| 24 |
|
| 285 |
|
| 4 |
|
| 31 |
|
Custodian |
|
| — |
|
| 15,958 |
|
| — |
|
| — |
|
Trustee |
|
| 167 |
|
| — |
|
| 240 |
|
| 91 |
|
Other |
|
| 15,177 |
|
| 4,815 |
|
| 20,981 |
|
| 10,838 |
|
|
|
|
|
|
| ||||||||
Total Liabilities |
|
| 1,184,459 |
|
| 121,061 |
|
| 655,644 |
|
| 374,899 |
|
|
|
|
|
|
| ||||||||
| |||||||||||||
Applicable to investors’ beneficial interest |
| $ | 98,750,801 |
| $ | 41,817,594 |
| $ | 139,401,552 |
| $ | 51,742,652 |
|
|
|
|
|
|
| ||||||||
Total Investments, at cost |
| $ | 78,705,605 |
| $ | 39,230,308 |
| $ | 121,095,594 |
| $ | 50,652,713 |
|
|
|
|
|
|
| ||||||||
Foreign currency, at cost |
| $ | — |
| $ | 366,489 |
| $ | — |
| $ | — |
|
|
|
|
|
|
|
|
|
|
47 | HSBC INVESTOR PORTFOLIOS | See notes to financial statements. |
|
HSBC INVESTOR PORTFOLIOS |
Statements of Operations—For the year ended October 31, 2010 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Growth |
| International |
| Opportunity |
| Value |
| ||||
Investment Income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends |
| $ | 580,486 |
| $ | 5,293,058 |
| $ | 713,126 |
| $ | 764,593 |
|
Foreign tax withholding |
|
| — |
|
| (726,788 | ) |
| — |
|
| (5,363 | ) |
|
|
|
|
|
| ||||||||
Total Investment Income |
|
| 580,486 |
|
| 4,566,270 |
|
| 713,126 |
|
| 759,230 |
|
|
|
|
|
|
| ||||||||
| |||||||||||||
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment Management |
|
| 520,858 |
|
| 1,111,069 |
|
| 1,058,022 |
|
| 258,230 |
|
Administration |
|
| 19,646 |
|
| 33,110 |
|
| 28,676 |
|
| 10,664 |
|
Accounting |
|
| 44,999 |
|
| 84,614 |
|
| 45,232 |
|
| 44,550 |
|
Compliance Services |
|
| 403 |
|
| 392 |
|
| 588 |
|
| 218 |
|
Custodian |
|
| 8,588 |
|
| 111,754 |
|
| 15,459 |
|
| 3,865 |
|
Printing |
|
| 5,755 |
|
| 7,077 |
|
| 7,901 |
|
| 3,108 |
|
Professional |
|
| 5,846 |
|
| 3,491 |
|
| 8,318 |
|
| 4,615 |
|
Trustee |
|
| 1,370 |
|
| 2,406 |
|
| 2,009 |
|
| 748 |
|
Other |
|
| 7,024 |
|
| (7,604 | ) |
| 8,707 |
|
| 3,310 |
|
|
|
|
|
|
| ||||||||
Total Expenses |
|
| 614,489 |
|
| 1,346,309 |
|
| 1,174,912 |
|
| 329,308 |
|
|
|
|
|
|
| ||||||||
| |||||||||||||
Net Investment Income (Loss) |
|
| (34,003 | ) |
| 3,219,961 |
|
| (461,786 | ) |
| 429,922 |
|
|
|
|
|
|
| ||||||||
| |||||||||||||
Net Realized/Unrealized Gains (Losses) from Investments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net realized gains (losses) from investments and foreign currency transactions |
|
| 4,569,747 |
|
| (24,730,645 | ) |
| 17,836,311 |
|
| 1,033,776 |
|
Change in unrealized appreciation/depreciation from investments and foreign currencies |
|
| 12,751,375 |
|
| 13,409,621 |
|
| 17,016,734 |
|
| 5,043,263 |
|
|
|
|
|
|
| ||||||||
| |||||||||||||
Net realized/unrealized gains from investments and foreign currency transactions |
|
| 17,321,122 |
|
| (11,321,024 | ) |
| 34,853,045 |
|
| 6,077,039 |
|
|
|
|
|
|
| ||||||||
Change In Net Assets Resulting From Operations |
| $ | 17,287,119 |
| $ | (8,101,063 | ) | $ | 34,391,259 |
| $ | 6,506,961 |
|
|
|
|
|
|
|
|
|
|
See notes to financial statements. | HSBC INVESTOR PORTFOLIOS | 48 |
|
HSBC INVESTOR PORTFOLIOS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Growth |
| International Equity |
| ||||||||
|
| For the |
| For the |
| For the |
| For the |
| ||||
Investment Activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income (loss) |
| $ | (34,003 | ) | $ | 136,286 |
| $ | 3,219,961 |
| $ | 4,063,044 |
|
Net realized gains (losses) from investments transactions |
|
| 4,569,747 |
|
| (12,681,042 | ) |
| (24,730,645 | ) |
| (72,712,532 | ) |
Change in unrealized appreciation/depreciation from investments and foreign currencies |
|
| 12,751,375 |
|
| 26,751,782 |
|
| 13,409,621 |
|
| 109,291,830 |
|
|
|
|
|
|
| ||||||||
Change in net assets resulting from operations |
|
| 17,287,119 |
|
| 14,207,026 |
|
| (8,101,063 | ) |
| 40,642,342 |
|
|
|
|
|
|
| ||||||||
Proceeds from contributions |
|
| 10,138,077 |
|
| 8,763,453 |
|
| 15,234,642 |
|
| 23,984,676 |
|
Value of withdrawals |
|
| (16,837,279 | ) |
| (16,749,107 | ) |
| (182,464,190 | ) |
| (46,787,723 | ) |
|
|
|
|
|
| ||||||||
Change in net assets resulting from transactions in investors’ beneficial interest |
|
| (6,699,202 | ) |
| (7,985,654 | ) |
| (167,229,548 | ) |
| (22,803,047 | ) |
|
|
|
|
|
| ||||||||
Change in net assets |
|
| 10,587,917 |
|
| 6,221,372 |
|
| (175,330,611 | ) |
| 17,839,295 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Net Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning of period |
|
| 88,162,884 |
|
| 81,941,512 |
|
| 217,148,205 |
|
| 199,308,910 |
|
|
|
|
|
|
| ||||||||
End of period |
| $ | 98,750,801 |
| $ | 88,162,884 |
| $ | 41,817,594 |
| $ | 217,148,205 |
|
|
|
|
|
|
|
|
|
|
49 | HSBC INVESTOR PORTFOLIOS | See notes to financial statements. |
|
HSBC INVESTOR PORTFOLIOS |
Statements of Changes in Net Assets (continued) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Opportunity |
| Value |
| ||||||||
|
| For the |
| For the |
| For the |
| For the |
| ||||
Investment Activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income (loss) |
| $ | (461,786 | ) | $ | (424,078 | ) | $ | 429,922 |
| $ | 644,544 |
|
Net realized gains (losses) from investments transactions |
|
| 17,836,311 |
|
| (15,580,861 | ) |
| 1,033,776 |
|
| (1,577,886 | ) |
Change in unrealized appreciation/depreciation from investments and foreign currencies |
|
| 17,016,734 |
|
| 31,798,950 |
|
| 5,043,263 |
|
| 9,018,297 |
|
|
|
|
|
|
| ||||||||
Change in net assets resulting from operations |
|
| 34,391,259 |
|
| 15,794,011 |
|
| 6,506,961 |
|
| 8,084,955 |
|
|
|
|
|
|
| ||||||||
Proceeds from contributions |
|
| 10,306,391 |
|
| 8,367,302 |
|
| 6,794,273 |
|
| 4,852,585 |
|
Value of withdrawals |
|
| (35,044,419 | ) |
| (22,382,631 | ) |
| (11,244,738 | ) |
| (12,914,556 | ) |
|
|
|
|
|
| ||||||||
Change in net assets resulting from transactions in investors’ beneficial interest |
|
| (24,738,028 | ) |
| (14,015,329 | ) |
| (4,450,465 | ) |
| (8,061,971 | ) |
|
|
|
|
|
| ||||||||
Change in net assets |
|
| 9,653,231 |
|
| 1,778,682 |
|
| 2,056,496 |
|
| 22,984 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning of period |
|
| 129,748,321 |
|
| 127,969,639 |
|
| 49,686,156 |
|
| 49,663,172 |
|
|
|
|
|
|
| ||||||||
End of period |
| $ | 139,401,552 |
| $ | 129,748,321 |
| $ | 51,742,652 |
| $ | 49,686,156 |
|
|
|
|
|
|
|
|
|
|
See notes to financial statements. | HSBC INVESTOR PORTFOLIOS | 50 |
|
HSBC INVESTOR PORTFOLIOS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Ratio/Supplementary Data |
| |||||||||||||||
|
|
|
|
| |||||||||||||||||
|
| Total |
| Net Assets |
| Ratio of Net |
| Ratio of Net |
| Ratio of |
| Portfolio |
| ||||||||
GROWTH PORTFOLIO |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
| 7.53 | % |
|
| $ | 59,828 |
|
| 0.69 | % |
| 0.38 | % |
| 0.69 | % |
| 75.06 | % |
|
Year Ended October 31, 2007 |
| 31.11 | % |
|
|
| 89,686 |
|
| 0.62 | % |
| 0.45 | % |
| 0.62 | % |
| 57.04 | % |
|
Year Ended October 31, 2008 |
| (37.75 | )%(b) |
|
|
| 81,942 |
|
| 0.62 | % |
| 0.19 | % |
| 0.62 | % |
| 157.87 | % |
|
Year Ended October 31, 2009 |
| 19.31 | % |
|
|
| 88,163 |
|
| 0.69 | % |
| 0.17 | % |
| 0.69 | % |
| 65.67 | % |
|
Year Ended October 31, 2010 |
| 20.34 | % |
|
|
| 98,751 |
|
| 0.68 | % |
| (0.04 | )% |
| 0.68 | % |
| 89.14 | % |
|
INTERNATIONAL EQUITY PORTFOLIO |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Year Ended October 31, 2006 |
| 32.79 | % |
|
|
| 333,755 |
|
| 0.86 | % |
| 2.03 | % |
| 0.86 | % |
| 33.39 | % |
|
Year Ended October 31, 2007 |
| 25.17 | % |
|
|
| 455,062 |
|
| 0.79 | % |
| 2.16 | % |
| 0.79 | % |
| 26.08 | % |
|
Year Ended October 31, 2008 |
| (51.79 | )% |
|
|
| 199,309 |
|
| 0.76 | % |
| 2.65 | % |
| 0.76 | % |
| 28.98 | % |
|
Year Ended October 31, 2009 |
| 24.16 | % |
|
|
| 217,148 |
|
| 0.88 | % |
| 2.23 | % |
| 0.88 | % |
| 58.31 | % |
|
Year Ended October 31, 2010 |
| 6.15 | % |
|
|
| 41,818 |
|
| 0.87 | % |
| 2.07 | % |
| 0.87 | % |
| 63.35 | % |
|
OPPORTUNITY PORTFOLIO |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Year Ended October 31, 2006 |
| 19.54 | % |
|
|
| 241,495 |
|
| 0.91 | % |
| (0.40 | )% |
| 0.91 | % |
| 60.83 | % |
|
Year Ended October 31, 2007 |
| 30.54 | % |
|
|
| 224,268 |
|
| 0.91 | % |
| (0.55 | )% |
| 0.91 | % |
| 69.41 | % |
|
Year Ended October 31, 2008 |
| (35.30 | )% |
|
|
| 127,970 |
|
| 0.87 | % |
| (0.46 | )% |
| 0.87 | % |
| 80.42 | % |
|
Year Ended October 31, 2009 |
| 15.41 | % |
|
|
| 129,748 |
|
| 0.90 | % |
| (0.37 | )% |
| 0.90 | % |
| 64.91 | % |
|
Year Ended October 31, 2010 |
| 28.74 | % |
|
|
| 139,402 |
|
| 0.89 | % |
| (0.35 | )% |
| 0.89 | % |
| 67.62 | % |
|
VALUE PORTFOLIO |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended October 31, 2006 |
| 22.21 | % |
|
|
| 67,432 |
|
| 0.71 | % |
| 1.23 | % |
| 0.71 | % |
| 20.63 | % |
|
Year Ended October 31, 2007 |
| 10.28 | % |
|
|
| 82,658 |
|
| 0.66 | % |
| 1.29 | % |
| 0.66 | % |
| 18.67 | % |
|
Year Ended October 31, 2008 |
| (39.91 | )% |
|
|
| 49,663 |
|
| 0.64 | % |
| 1.54 | % |
| 0.64 | % |
| 24.61 | % |
|
Year Ended October 31, 2009 |
| 20.05 | % |
|
|
| 49,686 |
|
| 0.68 | % |
| 1.41 | % |
| 0.68 | % |
| 19.77 | % |
|
Year Ended October 31, 2010 |
| 13.56 | % |
|
|
| 51,743 |
|
| 0.67 | % |
| 0.87 | % |
| 0.67 | % |
| 26.36 | % |
|
|
|
(a) | Excludes fee reductions. If such fee reductions had not occurred, the ratio would have been as indicated. |
|
|
(b) | During the year ended October 31, 2008, Winslow Capital Management, Inc. reimbursed $64,658 to the Growth Portfolio related to violations of certain investment policies and limitations. The corresponding impact to the total return was 0.08%. |
|
|
|
51 | HSBC INVESTOR PORTFOLIOS | See notes to financial statements. |
|
HSBC INVESTOR PORTFOLIOS |
|
|
1. | Organization: |
|
|
| The HSBC Investor Portfolios (the “Portfolio Trust’’), is an open-end management investment company organized as a New York trust under the laws of the State of New York on November 1, 1994. The Portfolio Trust contains the following master funds (individually a “Portfolio,’’ collectively the “Portfolios’’): |
|
|
|
|
|
| Portfolio |
| Short Name |
|
|
|
| ||
| HSBC Investor Growth Portfolio | Growth Portfolio | ||
| HSBC Investor International Equity Portfolio | International Equity Portfolio | ||
| HSBC Investor Opportunity Portfolio | Opportunity Portfolio | ||
| HSBC Investor Value Portfolio | Value Portfolio |
|
|
| The Portfolios operate as master funds in master-feeder arrangements, in which other funds invest all or part of their investable assets in the Portfolios. The Portfolios also receive investments from funds of funds. The Declaration of Trust permits the Board of Trustees to issue an unlimited number of beneficial interests in the Portfolios. |
|
|
| The Portfolios are diversified series of the Portfolio Trust and are part of the HSBC Investor Family of Funds. Financial statements for all other funds of the HSBC Investor Family of Funds are published separately. |
|
|
| Under the Portfolio Trust’s organizational documents, the Portfolio Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Portfolios. In addition, in the normal course of business, the Portfolio Trust may enter into contracts with its service providers, which also provide for indemnifications by the Portfolios. The Portfolios’ maximum exposure under these arrangements is unknown as this would involve any future claims that may be made against the Portfolios. However, based on experience, the Portfolio Trust expects that risk of loss to be remote. |
|
|
2. | Significant Accounting Policies: |
|
|
| The following is a summary of the significant accounting policies followed by the Portfolios in the preparation of their financial statements. The policies are in conformity with U.S. generally accepted accounting principles (“GAAP’’). The preparation of financial statements requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. Management has evaluated events and transactions through the date the financial statements were available to be issued, for purposes of recognition or disclosure in these financial statements. |
|
|
| Securities Valuation: |
|
|
| The Portfolios record their investments at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The valuation techniques used to determine fair value are further described in Note 3 below. |
|
|
| Investment Transactions and Related Income: |
|
|
| Investment transactions are accounted for no later than one business day after trade date. For financial reporting purposes, changes in holdings are accounted for on trade date on the last business day of the reporting period. Investment gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
|
|
| Foreign Currency Translation: |
|
|
| The accounting records of the Portfolios are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. Purchases and sales of securities, and income and expenses are translated at the prevailing rate of exchange on the respective dates of such transactions. The Portfolios do not isolate the portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
|
|
|
| HSBC INVESTOR PORTFOLIOS | 52 |
|
HSBC INVESTOR PORTFOLIOS |
Notes to Financial Statements—as of October 31, 2010 |
|
|
| Expense Allocations: |
|
|
| Expenses directly attributable to a Portfolio are charged to that Portfolio. Expenses not directly attributable to a Portfolio are allocated proportionally among various or all funds within the HSBC Investor Family of Funds in relation to net assets or on another reasonable basis. |
|
|
| Federal Income Taxes: |
|
|
| Each Portfolio will be treated as a partnership for U.S. Federal income tax purposes. Accordingly, each Portfolio passes through all of its net investment income and gains and losses to its feeder funds, and is therefore not subject to U.S. Federal income tax. As such, investors in the Portfolios will be taxed on their respective share of the Portfolios’ ordinary income and realized gains. It is intended that the Portfolios will be managed in such a way that an investor will be able to satisfy the requirements of the Internal Revenue Code applicable to regulated investment companies. |
|
|
| Management of the Portfolios has reviewed tax positions taken in tax years that remain subject to examination by all major tax jurisdictions, including federal (i.e., the last four tax year ends and the interim tax period since then, as applicable). Management believes that there is no tax liability resulting from unrecognized tax benefits related to uncertain tax positions taken. |
|
|
| Derivative Instruments |
|
|
| All open derivative positions at year end are reflected on the Portfolio’s Schedule of Portfolio Investments. The following is a description of the derivative instruments utilized by the Fund, including the primary underlying risk exposures related to each instrument type. |
|
|
| Foreign Currency Exchange Contracts: |
|
|
| Each Portfolio may enter into foreign currency exchange contracts. The Portfolios enter into foreign currency exchange contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of securities denominated in a particular currency. In addition to the foreign currency risk related to the use of these contracts, the Portfolios could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. The foreign currency exchange contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. For the year ended October 31, 2010, the International Equity Portfolio entered into foreign currency exchange contracts to hedge the U.S. dollar value of securities denominated in a particular currency. As of October 31, 2010, the Portfolios did not hold any foreign currency exchange contracts. For the year ended October 31, 2010, the monthly average contract amount of foreign exchange contracts held by the International Equity Portfolio was $6.24 million. |
|
|
| Futures Contracts: |
|
|
| Each Portfolio may invest in futures contracts. The Portfolios use futures contracts for the purpose of hedging their existing portfolio securities or securities they intend to purchase against fluctuations in fair value caused by changes in prevailing market interest rates. Upon entering into a futures contract, the Portfolio is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,’’ are made or received by the Portfolio each day, depending on the daily fluctuations in the fair value of the underlying security. The Portfolio recognizes a gain or loss equal to the daily variation margin. Should market conditions move unexpectedly, the Portfolio may not achieve the anticipated benefits of the futures contracts and may realize a loss. Futures contracts involve, to varying degrees, elements of market risk (generally equity price risk related to stock futures, interest rate risk related to bond futures, and foreign currency risk related to currency futures) and exposure to loss in excess of the variation margin. The primary risks associated with the use of futures contracts are the imperfect correlation between the change in market value of the securities held by the Portfolios and the prices of futures contracts, the possibility of an illiquid market, and the inability of the counterparty to meet the terms of the contract. For the year ended October 31, 2010, the Portfolios did not hold any futures contracts. |
|
|
53 | HSBC INVESTOR PORTFOLIOS |
|
HSBC INVESTOR PORTFOLIOS |
Notes to Financial Statements—as of October 31, 2010 (continued) |
|
|
| Summary of Derivative Instruments: |
|
|
| The following is a summary of the fair value of derivative instruments for the International Equity Portfolio as of October 31, 2010: |
|
|
|
|
|
|
|
|
|
|
|
| Asset Derivatives |
| Liability Derivatives |
| ||||
|
|
|
| ||||||
Primary Risk Exposure |
| Statements of Assets |
| Total Fair |
| Statements of Assets |
| Total Fair |
|
|
|
|
|
| |||||
Foreign Currency Exchange Contracts |
| Unrealized appreciation on foreign currency exchange contracts |
| $— |
| Unrealized depreciation on foreign currency exchange contracts |
| $— |
|
|
|
|
| ||
| * | Total Fair Value is presented by Primary Risk Exposure. For foreign currency exchange contracts, such amounts represent the unrealized gain/appreciation (for asset derivatives) or loss/depreciation (for liability derivatives). |
|
|
| The derivative instruments had the following impact on the Statements of Operations for the International Equity Portfolio for the period ended October 31, 2010: |
|
|
|
|
|
|
|
|
Primary Risk Exposure |
| Location of |
| Realized |
| Change in Unrealized |
|
|
|
|
| ||||
Foreign Currency Exchange Contracts |
| Net realized gains (losses) from investments and foreign currency transactions/change in unrealized appreciation/depreciation on investments and foreign currencies |
| $563,265 |
| $5,279 |
|
|
|
3. | Investment Valuation Summary: |
| |
| The valuation techniques employed by the Portfolios, as described below, maximize the use of observable inputs and minimize the use of unobservable inputs in determining fair value. The inputs used for valuing the Portfolios’ investments are summarized in the three broad levels listed below: |
|
|
|
| • | Level 1: quoted prices in active markets for identical assets |
|
|
|
| • | Level 2: other significant observable inputs (including quoted prices for similar securities, interest rates, prepayments speeds, credit risk, etc.) |
|
|
|
| • | Level 3: significant unobservable inputs (including the Portfolio’s own assumptions in determining the fair value of investments) |
|
|
| The inputs or methodology used for valuing investments are not necessarily an indication of the risk associated with investing in those investments. |
|
|
| Exchange traded, domestic equity securities are valued at the last sales price on a national securities exchange, or in the absence of recorded sales, at the readily available closing bid price on such exchanges, or at the quoted bid price in the over-the-counter market and are typically categorized as Level 1 in the fair value hierarchy. |
|
|
| Exchange traded, foreign equity securities are valued in the appropriate currency on the last quoted sale price and are typically categorized as Level 1 in the fair value hierarchy. Foreign equity securities that are not exchanged traded are valued in the appropriate currency at the average of the quoted bid and asked prices in the over-the-counter market and are typically categorized as Level 2 in the fair value hierarchy. |
|
|
| Shares of exchange traded and closed-end registered investment companies are valued in the same manner as other equity securities and are typically categorized as Level 1 in the fair value hierarchy. Mutual funds are valued at their net asset values, as reported by such companies and are typically categorized as Level 1 in the fair value hierarchy. |
|
|
HSBC INVESTOR PORTFOLIOS | 54 |
|
HSBC INVESTOR PORTFOLIOS |
Notes to Financial Statements—as of October 31, 2010 (continued) |
|
|
| Exchange traded futures contracts are valued at their settlement price on the exchange on which they are traded and are typically categorized as Level 1 in the fair value hierarchy. Forward foreign currency contracts are generally valued at the foreign currency exchange rate as of the close of the New York Stock Exchange and are typically categorized as Level 2 in the fair value hierarchy. Repurchase agreements are valued at original cost and are typically categorized as Level 2 in the fair value hierarchy. |
|
|
| Securities or other assets for which market quotations are not readily available, or are deemed unreliable due to a significant event or otherwise, are valued pursuant to procedures adopted by the Portfolio Trust’s Board of Trustees. Depending on the source and relative significance of valuation inputs, these instruments may be classified as Level 2 or Level 3 in the fair value hierarchy. Examples of potentially significant events that could affect the value of an individual security and thus require pricing under the procedures include corporate actions by the issuer, announcements by the issuer relating to its earnings or products, regulatory news, natural disasters, and litigation. Examples of potentially significant events that could affect multiple securities held by a Portfolio include governmental actions, natural disasters, and armed conflicts. In addition, if events materially affecting the value of foreign securities occur between the time when the exchange on which they are traded closes and the time when the Portfolios’ net assets are calculated, such securities may be valued using fair value pricing in accordance with procedures adopted by the Board of Trustees. Management identifies possible fluctuations in foreign securities by monitoring the rise or fall in the value of a designated benchmark index. In the event of a rise or fall greater than predetermined levels, the International Equity Portfolio may use a systematic valuation model provided by an independent third party to value its foreign securities, rather than local market closing prices. When the International Equity Portfolio uses such a valuation model, the value assigned to the International Equity Portfolio’s foreign securities may not be the quoted or published prices of the investment on their primary markets or exchanges and are typically categorized as Level 2 in the fair value hierarchy. The valuation of these securities may represent a transfer between Levels 1 and 2. The number of days on which fair value prices will be used will depend on market activity and it is possible that fair value prices will be used by the International Equity Portfolio to a significant extent. |
|
|
55 | HSBC INVESTOR PORTFOLIOS |
|
HSBC INVESTOR PORTFOLIOS |
Notes to Financial Statements—as of October 31, 2010 (continued) |
|
|
| For the year ended October 31, 2010, there were no Level 3 investments for which significant unobservable inputs were used to determine fair value. |
|
|
| The following is a summary of the valuation inputs used as of October 31, 2010 in valuing the Portfolios’ investments based upon three levels defined above: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| LEVEL 1 |
| LEVEL 2 |
| LEVEL 3 |
| Total |
| ||||
|
|
|
|
|
| ||||||||
Growth Portfolio |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment Securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Stocks (a) |
| $ | 96,843,545 |
| $ | — |
| $ | — |
| $ | 96,843,545 |
|
Investment Companies |
|
| 1,314,150 |
|
| — |
|
| — |
|
| 1,314,150 |
|
|
|
|
|
|
| ||||||||
Total Investment Securities |
| $ | 98,157,695 |
| $ | — |
| $ | — |
| $ | 98,157,695 |
|
�� |
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International Equity Portfolio |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment Securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Stocks: (+) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Brazil |
| $ | 528,105 |
| $ | — |
| $ | — |
| $ | 528,105 |
|
Canada |
|
| 2,024,591 |
|
| — |
|
| — |
|
| 2,024,591 |
|
Kazakhstan |
|
| 121,260 |
|
| — |
|
| — |
|
| 121,260 |
|
Russian Federation |
|
| 122,752 |
|
| — |
|
| — |
|
| 122,752 |
|
South Korea |
|
| 165,187 |
|
| 419,856 |
|
| — |
|
| 585,043 |
|
All other Common Stocks (b) |
|
| — |
|
| 37,080,228 |
|
| — |
|
| 37,080,228 |
|
Investment Companies |
|
| 391,214 |
|
| — |
|
| — |
|
| 391,214 |
|
|
|
|
|
|
| ||||||||
Total Investment Securities |
| $ | 3,353,109 |
| $ | 37,500,084 |
| $ | — |
| $ | 40,853,193 |
|
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Opportunity Portfolio |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment Securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Stocks (a) |
| $ | 135,323,271 |
| $ | — |
| $ | — |
| $ | 135,323,271 |
|
Investment Companies |
|
| 3,971,916 |
|
| — |
|
| — |
|
| 3,971,916 |
|
|
|
|
|
|
| ||||||||
Total Investment Securities |
| $ | 139,295,187 |
| $ | — |
| $ | — |
| $ | 139,295,187 |
|
|
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Value Portfolio |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment Securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Stocks (a) |
| $ | 48,717,360 |
| $ | — |
| $ | — |
| $ | 48,717,360 |
|
Investment Companies |
|
| 3,379,613 |
|
| — |
|
| — |
|
| 3,379,613 |
|
|
|
|
|
|
| ||||||||
Total Investment Securities |
| $ | 52,096,973 |
| $ | — |
| $ | — |
| $ | 52,096,973 |
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
| (a) | For detailed industry descriptions, see the accompanying Schedules of Portfolio Investments. |
|
|
|
|
|
| (b) | For detailed country descriptions, see the accompanying Schedules of Portfolio Investments. |
|
|
|
|
|
| (+) | Based on the domicile of the security issuer. |
|
|
|
|
| The Trust recognizes significant transfers between fair value hierarchy levels at the reporting period end. The only significant transfers between Levels 1 and 2 as of October 31, 2010 are related to the use of the systematic valuation model to value foreign securities in the International Equity Portfolio. | ||
|
|
|
|
4. | Related Party Transactions: | ||
|
|
|
|
| Investment Management: | ||
|
|
|
|
| HSBC Global Asset Management (USA) Inc. (“HSBC’’ or the “Investment Adviser’’), a wholly owned subsidiary of HSBC Bank USA, N.A., a national bank organized under the laws of the United States, acts as the Investment Adviser to the Portfolios pursuant to an investment management contract with the Portfolio Trust. As Investment Adviser, HSBC manages the investments of the Portfolios and continuously reviews, supervises, and administers the Portfolios’ investments, except that Winslow Capital Management, Inc., AllianceBernstein L.P., Westfield Capital Management Company, L.P. and NWQ Investment Management Company, LLC serve as Sub-Investment Advisers for the Growth Portfolio, International |
|
|
HSBC INVESTOR PORTFOLIOS | 56 |
|
HSBC INVESTOR PORTFOLIOS |
Notes to Financial Statements—as of October 31, 2010 (continued) |
|
|
| Equity Portfolio, Opportunity Portfolio, and the Value Portfolio, respectively, and are paid for their services directly by the respective Portfolios. |
|
|
| For their services, the Investment Adviser and Winslow Capital Management, Inc. (“Winslow”) receive in aggregate, from the Growth Portfolio, a fee, accrued daily and paid monthly, at an annual rate of: |
|
|
|
|
|
Based on Average Daily Net Assets of all Sub-Adviser serviced funds and separate accounts affiliated with HSBC: |
| Fee Rate* |
| |
|
| |||
Up to $250 million |
| 0.575 | % |
|
In excess of $250 million but not exceeding $500 million |
| 0.525 | % |
|
In excess of $500 million but not exceeding $750 million |
| 0.475 | % |
|
In excess of $750 million but not exceeding $1 billion |
| 0.425 | % |
|
In excess of $1 billion |
| 0.375 | % |
|
|
|
|
| ||
| * | The Growth Portfolio may pay the Investment Adviser and Winslow an aggregate maximum fee of up to 0.68%. Currently, the Investment Adviser’s contractual fee is 0.175% and Winslow’s maximum contractual fee is 0.40%. Accordingly, the current aggregate maximum fee rate is 0.575%. |
|
|
| For their services, the Investment Adviser and AllianceBernstein L.P. receive in aggregate, from the International Equity Portfolio, a fee, accrued daily and paid monthly, at an annual rate of: |
|
|
|
|
|
Based on Average Daily Net Assets of: |
| Fee Rate |
| |
|
| |||
Up to $10 million |
| 1.015 | % |
|
In excess of $10 million but not exceeding $25 million |
| 0.925 | % |
|
In excess of $25 million but not exceeding $50 million |
| 0.79 | % |
|
In excess of $50 million but not exceeding $100 million |
| 0.70 | % |
|
In excess of $100 million |
| 0.61 | % |
|
|
|
| For their services, the Investment Adviser and Westfield Capital Management Company, L.P. receive in aggregate, a fee, accrued daily and paid monthly, at an annual rate of 0.80% of the Opportunity Portfolio’s average daily net assets. |
|
|
| For their services, the Investment Adviser and NWQ Investment Management Company, LLC receive in aggregate, from the Value Portfolio, a fee, accrued daily and paid monthly, at an annual rate of: |
|
|
|
|
|
Based on Average Daily Net Assets of |
| Fee Rate |
| |
|
| |||
Up to $500 million |
| 0.525 | % |
|
In excess of $500 million but not exceeding $1 billion |
| 0.475 | % |
|
In excess of $1 billion |
| 0.425 | % |
|
|
|
| Any voluntary fee waivers/reimbursements are not subject to recoupment in subsequent fiscal periods. Voluntary waiver/reimbursements may be stopped at any time. |
|
|
| Administration: |
|
|
| HSBC serves the Portfolios as Administrator. Under the terms of the Administration Agreement, HSBC receives from the Portfolios (as well as the other funds in the HSBC Investor Family of Funds) a fee, accrued daily and paid monthly at annual rate of: |
|
|
|
|
|
Based on Average Daily Net Assets of |
| Fee Rate |
| |
|
| |||
Up to $10 billion |
| 0.0550 | % |
|
In excess of $10 billion but not exceeding $20 billion |
| 0.0350 | % |
|
In excess of $20 billion but not exceeding $50 billion |
| 0.0275 | % |
|
In excess of $50 billion |
| 0.0250 | % |
|
|
|
| The fee rates and breakpoints are determined on the basis of the aggregate average daily net assets of the HSBC Investor Family of Funds, however, the assets of the Portfolios and HSBC Investor Funds that invest in the Portfolios are not double-counted. The total administration fee paid to HSBC is allocated to each series in the HSBC Investor Family of Funds based upon its proportionate share of the aggregate net assets of the Family of Funds. For assets invested in the Portfolios by the HSBC Investor Funds, the Portfolios pay half of the administration fee and the other funds pay half of the administration fee, for a combination of the total fee rate set forth above. Certain administrative fees of the Portfolios also may be received by treating them as apportioned in part to other funds makes investments in the Portfolios a master-feeder structure. |
|
|
57 | HSBC INVESTOR PORTFOLIOS |
|
HSBC INVESTOR PORTFOLIOS |
Notes to Financial Statements—as of October 31, 2010 (continued) |
|
|
| Pursuant to a Sub-Administration Agreement with HSBC, Citi Fund Services Ohio, Inc. (“Citi Ohio’’), a wholly-owned subsidiary of Citigroup, Inc., serves as the Portfolio Trust’s Sub-Administrator subject to the general supervision of the Portfolio Trust’s Board of Trustees and HSBC. For these services, Citi Ohio is entitled to a fee, payable by HSBC, at an annual rate equivalent to the fee rates set forth above, minus 0.02% (2 basis points) which is retained by HSBC. |
|
|
| Under a Compliance Services Agreement between the Portfolio Trust and the other HSBC Investor Funds (the “Trusts”) and Citi Ohio (the “CCO Agreement’’), Citi Ohio makes an employee available to serve as the Trusts’ Chief Compliance Officer (the “CCO’’). Under the CCO Agreement, Citi Ohio also provides infrastructure and support in implementing the written policies and procedures comprising the Portfolios’ compliance program, including support services to the CCO. For the services provided under the CCO Agreement, the HSBC Investor Family of Funds paid Citi Ohio $269,869 for the year ended October 31, 2010, plus reimbursement of certain expenses. Expenses incurred by each Portfolio are reflected on the Statements of Operations as “Compliance Services.’’ Citi Ohio pays the salary and other compensation earned by individuals as employees of Citi Ohio. |
|
|
| Fund Accounting and Trustees: |
|
|
| Citi Ohio provides fund accounting services for the Portfolio Trust. For its services to the Portfolios, Citi Ohio receives an annual fee per portfolio, including reimbursement of certain expenses, that is accrued daily and paid monthly. |
|
|
| Each non-interested Trustee is compensated with a $60,000 annual Board retainer for services as a Trustee of the HSBC Investor Family of Funds (or the “Trusts”), as well as a $3,000 annual retainer for each Committee of the Board of the Trusts. Each non-interested Trustee also receives a $5,000 and $3,000 meeting fee for each regular in-person Board meeting and Committee meeting, respectively. Furthermore, each non-interested Trustee receives compensation for attending special meetings and/or functioning as a Committee or Board Chairperson. In addition, the non-interested Trustees are reimbursed for certain expenses incurred in connection with their Board membership. |
|
|
5. | Investment Transactions: |
|
|
| Cost of purchases and proceeds from sales of securities (excluding securities maturing less than one year from acquisition) for the year ended October 31, 2010 were as follows: |
|
|
|
|
|
|
|
|
Portfolio Name |
| Purchases |
| Sales |
| ||
|
|
| |||||
Growth Portfolio |
| $ | 78,285,103 |
| $ | 82,782,432 |
|
International Equity Portfolio |
|
| 94,911,257 |
|
| 123,210,909 |
|
Opportunity Portfolio |
|
| 86,072,250 |
|
| 105,288,751 |
|
Value Portfolio |
|
| 12,420,582 |
|
| 17,955,334 |
|
|
|
| For the year ended October 31, 2010, there were no long-term U.S. Government securities held by the Portfolio Trust. |
|
|
6. | Federal Income Tax Information: |
|
|
| At October 31, 2010, the cost basis of securities for federal income tax purposes, gross unrealized appreciation, gross unrealized depreciation and net unrealized appreciation/depreciation were as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fund |
| Tax Cost |
| Tax Unrealized |
| Tax Unrealized |
| Net Unrealized |
| ||||
|
|
|
|
| |||||||||
Growth Portfolio |
| $ | 79,283,771 |
| $ | 18,873,924 |
| $ | — |
| $ | 18,873,924 |
|
International Equity Portfolio |
|
| 39,386,379 |
|
| 3,376,252 |
|
| (1,909,438 | ) |
| 1,466,814 |
|
Opportunity Portfolio |
|
| 124,125,662 |
|
| 23,999,412 |
|
| (8,829,887 | ) |
| 15,169,525 |
|
Value Portfolio |
|
| 50,811,505 |
|
| 6,302,313 |
|
| (5,016,845 | ) |
| 1,285,468 |
|
|
|
|
| ||
| * | The difference between book-basis unrealized appreciation (depreciation) is attributable primarily to tax deferral of losses on wash sales. |
|
|
HSBC INVESTOR PORTFOLIOS | 58 |
|
HSBC INVESTOR PORTFOLIOS |
Notes to Financial Statements—as of October 31, 2010 (continued) |
|
|
7. | Legal and Regulatory Matters: |
|
|
| On September 26, 2006 BISYS Fund Services, Inc. (“BISYS’’), an affiliate of BISYS Fund Services Ohio, Inc. which provided various services to the Portfolios, reached a settlement with the Securities and Exchange Commission (the “SEC’’) regarding the SEC’s investigation related to BISYS’ past payment of certain marketing and other expenses with respect to certain of its mutual fund clients. There was no impact on the Portfolios’ financial statements as the Portfolios did not receive any settlement monies. |
|
|
8. | Subsequent Events (Unaudited): |
|
|
| Effective November 1, 2010, each non-interested Trustee is compensated with a $63,000 annual Board retainer for service as a Trustee of the Trust and the other HSBC Investor Funds, as well as a $3,000 annual retainer for each Committee of the Board of the Trust and other HSBC Investor Funds. Each non-interested Trustee also receives a $5,000 and $3,000 meeting fee for each regular in-person Board meeting and Committee meeting, respectively. Furthermore, each non-interested Trustee receives compensation for attending special meetings and/or functioning as a Committee or Board Chairperson. In addition, the noninterested Trustees are reimbursed for certain expenses incurred in connection with their Board membership. |
|
|
| Effective at the close of business on January 12, 2011, Lord, Abbett & Co. LLC will replace AllianceBernstein L.P. as Sub-Investment Adviser to the International Equity Portfolio. |
|
|
59 | HSBC INVESTOR PORTFOLIOS |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Trustees
of HSBC Investor Portfolios:
We have audited the accompanying statements of assets and liabilities of HSBC Investor Portfolios – HSBC Investor Growth Portfolio, HSBC Investor International Equity Portfolio, HSBC Investor Opportunity Portfolio and HSBC Investor Value Portfolio (the Funds), including the schedules of portfolio investments, as of October 31, 2010, and the related statements of operations for the year then ended, the changes in net assets for each year in the two-year period then ended, and the financial highlights for each year in the five-year period then ended. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of October 31, 2010, by correspondence with custodians and brokers or by other appropriate auditing procedures. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Funds as of October 31, 2010, the results of their operations for the year then ended, the changes in their net assets for each year in the two-year period then ended, and the financial highlights for each year in the five-year period then ended, in conformity with U.S. generally accepted accounting principles.
Columbus, Ohio
December 22, 2010
|
|
HSBC INVESTOR PORTFOLIOS | 60 |
|
HSBC INVESTOR PORTFOLIOS |
Table of Shareholder Expenses (Unaudited)—as of October 31, 2010 |
|
|
| As a shareholder of the HSBC Investor Portfolios (“Portfolios”), you incur ongoing costs, including management fees and other Fund expenses. |
|
|
| These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Portfolios and to compare these costs with the ongoing costs of investing in other mutual funds. |
|
|
| These examples are based on an investment of $1,000 invested at the beginning of the period and held for the entire period from May 1, 2010 through October 31, 2010. |
|
|
| Actual Example |
|
|
| The table below provides information about actual account values and actual expenses. You may use the information below, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Beginning |
| Ending |
| Expenses Paid |
| Annualized |
| ||||||||||
|
|
|
|
|
| ||||||||||||||
Growth Portfolio |
|
| $ | 1,000.00 |
|
|
| $ | 1,045.40 |
|
|
| $ | 3.56 |
|
| 0.69 | % |
|
International Equity Portfolio |
|
|
| 1,000.00 |
|
|
|
| 1,044.60 |
|
|
|
| 4.59 |
|
| 0.89 | % |
|
Opportunity Portfolio |
|
|
| 1,000.00 |
|
|
|
| 1,035.30 |
|
|
|
| 4.62 |
|
| 0.90 | % |
|
Value Portfolio |
|
|
| 1,000.00 |
|
|
|
| 996.50 |
|
|
|
| 3.42 |
|
| 0.68 | % |
|
|
|
* | Expenses are equal to the average account value over the period multiplied by the Portfolio’s annualized expense ratio, multiplied by the number of days in the most recent fiscal half-year divided by the number of days in the fiscal year (to reflect the one half year period). |
|
|
| Hypothetical Example for Comparison Purposes |
|
|
| The table below provides information about hypothetical account values and hypothetical expenses based on each Portfolio’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Portfolio’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 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 transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Beginning |
| Ending |
| Expenses Paid |
| Annualized |
| ||||||||||
|
|
|
|
|
| ||||||||||||||
Growth Portfolio |
|
| $ | 1,000.00 |
|
|
| $ | 1,021.73 |
|
|
| $ | 3.52 |
|
| 0.69 | % |
|
International Equity Portfolio |
|
|
| 1,000.00 |
|
|
|
| 1,020.72 |
|
|
|
| 4.53 |
|
| 0.89 | % |
|
Opportunity Portfolio |
|
|
| 1,000.00 |
|
|
|
| 1,020.67 |
|
|
|
| 4.58 |
|
| 0.90 | % |
|
Value Portfolio |
|
|
| 1,000.00 |
|
|
|
| 1,021.78 |
|
|
|
| 3.47 |
|
| 0.68 | % |
|
|
|
* | Expenses are equal to the average account value over the period multiplied by the Portfolio’s annualized expense ratio, multiplied by the number of days in the most recent fiscal half-year divided by the number of days in the fiscal year (to reflect the one half year period). |
|
|
61 | HSBC INVESTOR PORTFOLIOS |
|
|
HSBC INVESTOR FAMILY OF FUNDS |
MANAGEMENT OF THE TRUST
The following table contains information regarding the HSBC Investor Family of Funds Board of Trustees (“Trustees”). Asterisks indicate those Trustees who are “interested persons,” as defined in the Investment Company Act of 1940, as amended, of the HSBC Investor Family of Funds. The HSBC Investor Family of Funds’ Statement of Additional Information includes additional information about the Trustees and is available by calling (888) 525-5757.
|
|
|
|
|
|
|
|
|
|
|
Name, Address |
| Position(s) |
| Term of Office and |
| Principal Occupation(s) |
| Number of |
| Other Directorships |
|
|
|
|
|
|
|
|
|
|
|
NON-INTERESTED |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marcia L. Beck |
| Trustee |
| Indefinite; June 2008 |
| Private Investor (June 1999 – present); Executive Vice President, Prudential Investments (1997 – 1999); President and Trustee, The Goldman Sachs Mutual Funds (1992 – 1996) |
| 32 |
| None |
Susan S. Huang |
| Trustee |
| Indefinite; June 2008 |
| Private Investor (2000 – present); Senior Vice President, Schroder Investment Management (2001 – 2004); Managing Director, Chase Asset Management (1995 – 2000) |
| 32 |
| None |
Alan S. Parsow |
| Trustee |
| Indefinite; 1987 |
| General Partner, Elkhorn Partners, L.P. (a private investment partnership) (1989 – present) |
| 32 |
| Penn Treaty American Corporation (insurance) |
Thomas F. Robards |
| Trustee |
| Indefinite; 2005 |
| Partner, Robards & Co. LLC (investment and advisory services) (2005 – present); Chief Financial Officer, American Museum of Natural History (2003 – 2004) Chief Financial Officer, Datek Online Holdings (2000 – 2003); Previously EVP and CFO Republic New York Corporation |
| 32 |
| Overseas Shipholding Group (NYSE listed energy transportation); Ellington Financial LLC (NYSE listed financial services); Financial Federal Corporation (NYSE listed specialty finance) |
Michael Seely |
| Chairman |
| Indefinite; 1987 |
| Private Investor (2003 – present); General Partner, Global Multi Manager Partners (1999 – 2003); President of Investor Access Corporation (1981 – 2003) |
| 32 |
| None |
|
|
|
|
|
|
|
|
|
| |
EMERITUS TRUSTEE |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
| |
Larry M. Robbins |
| Emeritus |
| Until December 31, 2011; |
| Private Investor (2007 – present); Director, Center for Teaching and Learning, University of Pennsylvania (1999 – 2007) |
| 32 |
| None |
|
|
* | Includes both the Fund and the underlying fund for Funds with a master/feeder structure. |
|
|
HSBC INVESTOR PORTFOLIOS | 62 |
|
HSBC INVESTOR FAMILY OF FUNDS |
Board of Trustees and Officers (Unaudited) (continued) |
The names of the officers, their addresses, ages, position(s) held with the Trust, and principal occupation(s) during the past five years are described in the table below.
|
|
|
|
|
|
|
Name, Address |
| Position(s) |
| Term of Office and |
| Principal Occupation(s) |
|
|
|
|
|
|
|
Richard A. Fabietti |
| President |
| One year; 2004 |
| Senior Vice President, Head of Product Management, HSBC Global Asset Management (USA) Inc. (1998 – present) |
Stephen Sivillo |
| Vice President |
| One year; 2010 |
| Vice President of Product Administration, HSBC Global Asset Management (USA) Inc. (2010 – present); Chief Compliance Officer, Managers Funds (2009 – 2010); Director, Mutual Fund Compliance, AllianceBernstein (2007 – 2009); Assistant Vice President, Compliance, AllianceBernstein (2005 – 2007) |
Ty Edwards* |
| Treasurer |
| One year; 2010 |
| Senior Vice President, Citi Fund Services (2010 – present); Director, Product Management, Columbia Management (2007 – 2009); Deputy Treasurer, Columbia Funds, (2006 – 2007); Director, Fund Administration, Columbia Management (2004 – 2007) |
Jennifer A. English* |
| Secretary |
| One year; 2008 |
| Senior Vice President, Regulatory Administration, Citi (2005 – present) |
F. Martin Fox |
| Assistant Secretary |
| One year; 2008 |
| Assistant Vice President, Regulatory Administration, Citi (May 2008 – present); Contract Attorney, Update Legal LLC (2002 – 2008) |
Frederick J. Schmidt* |
| Chief |
| One year; 2004 |
| Senior Vice President and Chief Compliance Officer, CCO Services, Citi (2004 – present) |
|
|
* | Mr. Edwards, Mr. Schmidt and Ms. English also are officers of certain other investment companies of which Citi (or an affiliate) is the administrator or sub-administrator. |
|
|
63 | HSBC INVESTOR PORTFOLIOS |
Information regarding how the Portfolios voted proxies relating to portfolio securities during the most recent 12-month period ended June 30th is available (i) without charge, upon request, by calling 1-800-525-5757 for HSBC Bank USA and HSBC Brokerage (USA) Inc. clients and 1-800-782-8183 for all other shareholders; (ii) on the HSBC Investor Family of Funds’ web-site at www.investorfunds.us.hsbc.com; and (iii) on the Security and Exchange Commission’s (“Commission”) website at http://www.sec.gov.
(i) The Portfolios file their complete schedules of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q; (ii) the Portfolios’ Form N-Q are available on the Commission’s website at http://www.sec.gov; (iii) the Portfolios’ Forms N-Q may be reviewed and copied at the Commission’s Public Reference Room in Washington, DC and information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330; and (iv) the Portfolios’ Schedules of Investments will be available no later than 60 days after each period end, without charge, on the HSBC Investor Family of Funds’ website at www.investorfunds.us.hsbc.com.
An investment in a Portfolio is not a deposit of HSBC Bank USA, National Association, and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency.
|
|
HSBC INVESTOR PORTFOLIOS | 64 |
(This Page Intentionally Left Blank)
|
|
HSBC INVESTOR FAMILY OF FUNDS: | SHAREHOLDER SERVICING AGENTS |
| For HSBC Bank USA, N.A. and |
INVESTMENT ADVISER AND ADMINISTRATOR | HSBC Securities (USA) Inc. Clients |
HSBC Global Asset Management (USA) Inc. | HSBC Bank USA, N.A. |
452 Fifth Avenue | 452 Fifth Avenue |
New York, NY 10018 | New York, NY 10018 |
| 1-888-525-5757 |
SUB-ADVISERS |
|
HSBC Investor Growth Portfolio | For All Other Shareholders |
Winslow Capital Management, Inc. | HSBC Investor Funds |
4720 IDS Tower | P.O. Box 182845 |
80th South Eighth Street | Columbus, OH 43218-2845 |
Minneapolis, MN 55402 | 1-800-782-8183 |
|
|
HSBC Investor International Equity Portfolio | TRANSFER AGENT |
AllianceBernstein L.P. | Citi Fund Services |
1345 Avenue of the Americas, 39th Floor | 3435 Stelzer Road |
New York, NY 10105 | Columbus, OH 43219 |
|
|
HSBC Investor Opportunity Portfolio | DISTRIBUTOR |
Westfield Capital Management Company, L.P. | Foreside Distribution Services, L.P. |
One Financial Center | 690 Taylor Road, Suite 150 |
Boston, MA 02111 | Gahanna, OH 43230-3202 |
|
|
HSBC Investor Value Portfolio | CUSTODIAN |
NWQ Investment Management Company, LLC | The Northern Trust Company |
2049 Century Park East, 16th Floor | 50 South LaSalle Street |
Los Angeles, CA 90067 | Chicago, IL 60603 |
|
|
| INDEPENDENT REGISTERED PUBLIC |
| ACCOUNTING FIRM |
| KPMG LLP |
| 191 West Nationwide Blvd., Suite 500 |
| Columbus, OH 43215 |
|
|
| LEGAL COUNSEL |
| Dechert LLP |
| 1775 I Street, N.W. |
| Washington, D.C. 20006 |
The HSBC Investor Family of Funds are distributed by Foreside Distribution Services, L.P. This document must be preceded or accompanied by a current prospectus for the HSBC Investor Funds, which you should read carefully before you invest or send money.
|
|
|
|
| — NOT FDIC INSURED | — NO BANK GUARANTEE | — MAY LOSE VALUE |
|
|
HSB-SR-WS | 12/10 |
Item 2. Code of Ethics.
(a) The registrant has adopted a code of ethics that applies to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. This code of ethics is included as an Exhibit.
(b) During the period covered by the report, with respect to the registrant’s code of ethics that applies to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions; there have been no amendments to, nor any waivers granted from, a provision that relates to any element of the code of ethics definition enumerated in paragraph (b) of this Item 2.
Item 3. Audit Committee Financial Expert.
3(a)(1) The registrant’s board of directors has determined that the registrant has at least one audit committee financial expert serving on its audit committee.
3(a)(2) The audit committee financial expert is Thomas Robards, who is “independent” for purposes of this Item 3 of Form N-CSR.
Item 4. Principal Accountant Fees and Services.
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| (a) Audit Fees, | |
| 2009 | $228,000 |
| 2010 | $228,000 |
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| (b) Audit-Related Fees, |
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| 2009 | $10,700 |
| 2010 | $6,200 |
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| 2009 – Fees of $10,700 relate to the consent of N-1A filing and the consent of the N-14 filing for the HSBC Investor Core Plus Fixed Income Fund (Advisor), HSBC Investor Core Plus Fixed Income Fund and HSBC Investor Intermediate Duration Fixed Income Fund. | |
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| 2010 – Fees of $6,200 relate to the consent of N-1A. | |
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| (c) Tax Fees, | |
| 2009 | $160,805 |
| 2010 | $138,625 |
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| Fees for both 2009 and 2010 relate to the preparation of federal income and excise tax returns and the review of excise tax distributions. | |
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| (d) All Other Fees, | |
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| 2009 | $0 |
| 2010 | $0 |
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(e)(1) Disclose the audit committee’s pre-approval policies and procedures described in paragraph (c)(7) of Rule 2-01 of Regulation S-X. | ||
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(2) Disclose the percentage of services described in each of paragraphs (b) through (d) of this Item that were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X. | ||
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None of the services summarized in (b) – (d), above, were approved by the audit Committee pursuant to Rule 2-01(c)(7)(i)(C) of Regulation S-X. | ||
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| (f) Not applicable. | |
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| (g) Non-Audit Fees. | |
| 2009 | $171,505 |
| 2010 | $144,825 |
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(h) The audit committee considered the nonaudit services rendered to the registrant’s investment adviser and any entity controlling, controlled by, or under common control with the investment adviser, and believes the services are compatible with the principal accountant’s independence. |
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Investments.
(a) Included as a part of the report to shareholders filed under Item 1.
(b) 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, based on their evaluation of the registrant’s disclosure controls and procedures as conducted within 90 days of the filing date of this report, that these disclosure controls and procedures are adequately designed and are operating effectively to ensure that information required to be disclosed by the registrant on Form N-CSR is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms.
(b) There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Act (17 CFR 270.30a-3(d)) that occurred during the second fiscal quarter of the period covered by this report that have materially affected or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Item 12. Exhibits.
(a)(1) The code of ethics that is the subject of the disclosure required by Item 2 is attached hereto.
(a)(2) Certifications pursuant to Rule 30a-2(a) are attached hereto.
(a)(3) Not applicable.
(b) Certifications pursuant to Rule 30a-2(b) are furnished herewith.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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(Registrant) | HSBC INVESTOR PORTFOLIOS |
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By (Signature and Title)* | /s/ Richard A. Fabietti |
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| Richard A. Fabietti |
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| President |
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Date | December 20, 2010 |
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Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
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By (Signature and Title)* | /s/ Richard A. Fabietti |
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| Richard A. Fabietti |
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| President |
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Date | December 20, 2010 |
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By (Signature and Title)* | /s/ Ty Edwards |
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| Ty Edwards |
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| Treasurer |
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Date | December 20, 2010 |
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* Print the name and title of each signing officer under his or her signature.