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 811-04010
OCM Mutual Fund
(Exact name of registrant as specified in charter)
2600 Kitty Hawk Road, Suite 119
Livermore, California 94551
(Address of principal executive offices) (Zip code)
Gregory M. Orrell
Orrell Capital Management, Inc
2600 Kitty Hawk Road, Suite 119
Livermore, California 94551
(Name and address of agent for service)
Registrant's telephone number, including area code: (925) 455-0802
Date of fiscal year end: November 30
Date of reporting period: May 31, 2014
ITEM 1. REPORT TO STOCKHOLDERS.
--------------
OCM GOLD FUND
==============
SEMI-ANNUAL REPORT
MAY 31, 2014
(UNAUDITED)
Dear Fellow Shareholders:
After a difficult 2013, gold prices stabilized in the first half of 2014. Shares
of gold mining companies increased modestly from historically extreme valuations
versus gold bullion (see Gold/XAU ratio chart, gold mining companies are
represented by the XAU). Over the six month fiscal period ended May 31, 2014,
the OCM Gold Fund Investor Class appreciated 5.51% (+0.76% after maximum sales
load) while the Advisor Class gained 6.01% compared to a 0.93% decline in the
Philadelphia Gold and Silver Index (XAU)(1) and 7.62% gain for the S&P 500
Index(2). The price of gold bullion at May 31, 2014 was basically unchanged at
$1,250.50 based on the London PM fix, down a modest $2.50 per ounce during the
six month period. Your Fund's investment strategy of owning a broad cross
section of the gold mining industry, including shares in intermediate/mid-tier
gold producers and junior gold producers, allowed the Fund to outperform the XAU
Index over the fiscal period.
GOLD/XAU RATIO
12/19/1983 3.40
12/19/1985 3.93
12/19/1989 3.40
12/19/1991 4.80
12/19/1993 2.91
12/19/1995 3.17
12/19/1997 4.06
12/19/1999 4.21
12/19/2001 5.04
12/19/2003 3.97
12/19/2005 4.06
12/19/2007 4.70
12/19/2009 6.73
12/19/2011 8.61
SOURCE: GLOBAL INSIGHTS -- DATA AS OF 5/31/2014
MARKET COMMENTARY
While strong equity markets continued to be a headwind for capital flows into
the gold sector along with negative commentary from main stream investment
banks, it appears fair weather holders of gold have exited the market relieving
the downward momentum on gold prices experienced in 2013. Much of the gold sold
from vaults in New York and London over the past two years has found its way to
the Far East. Gold in Asia tends to be viewed with longer time horizons and as a
strategic asset, therefore it is unlikely to be sold back into Western markets
as gold prices rise. In our opinion, gold and gold mining equities are in the
process of completing a major correction bottom that dates back to last summer
following the August 2011 high of $1,900/oz high. As we have
- 1 -
stated in recent shareholder letters, the current pull back in gold is similar,
in our opinion, to the gold price action experienced in 1975 to 1976 when gold
prices declined from $190/oz. to $103/oz., with the main difference being the
added zero representing the currency debasement over the past 40 years. While
further downside is quite possible, we are comfortable the stage is set for the
gold price in U.S. dollar terms to resume its secular uptrend over the coming
years.
Markets remain keenly focused on central bank monetary policy with the Federal
Reserve expected to end its bond buying/money printing operation by the end of
the year. The Federal Reserve has pronounced to keep interest rates low for the
foreseeable future after concluding its quantitative easing (QE) operation. We
view the pronouncement more as confirmation that the Federal Reserve's ability
to normalize interest rates in the current environment is limited with private
and public debt levels having exploded 40% since 2008 due to low rates. Central
bank efforts to stimulate economic growth with cheap money and money printing
have successfully lifted asset prices while elevating risk levels with economic
growth muted. As the Bank of International Settlements (BIS) points out in its
Annual Report published June 29th: "Overall, it is hard to avoid the sense of a
puzzling disconnect between the markets' buoyancy and underlying economic
developments globally ....... Progress in strengthening banks' balance sheets
has been uneven and private debt keeps growing. Macroeconomic policy has little
room for maneuver to deal with any untoward surprises that might be sprung,
including a normal recession." Consequently, should material inflation, as
measured by the consumer price index (CPI), materialize (it is our belief the
CPI understates real life cost of living inflation), we believe it will be
difficult for the Federal Reserve to gain the credibility necessary to fight
inflation with higher interest rates. In essence, we believe it will
consistently be behind the curve with negative interest rates (as represented by
short-term T-bill rates minus inflation). Historically, negative interest rates
provide a favorable environment for gold as paper money is losing value
transparently.
Interestingly, the U.S. dollar, as measured by the U.S. Dollar Index (DXY), has
failed to move higher with equity markets and improving U.S. economic conditions
over the past three years. There is no historical precedent for such divergent
behavior for the U.S. dollar, which obviously begs the question, why? Perhaps
the foreign exchange market has sniffed out the Federal Reserve's policy
predicament when it comes to fighting future inflation. More troublesome for
the dollar may be the move by Russia and China and its trading partners to
increase trade away from the dollar in an effort to "de-dollarize" the global
economy and United States influence. Another possible explanation is the
positive effects of monetary stimulus showing signs of being exhausted both in
the U.S. and globally, raising possibility that the Fed will embark on another
round of QE at the first hint of a recession, due to the fear of domino leverage
setting the stage for a possible repeat of the near death experience of 2008.
At the moment, markets are complacent and willing to ignore the growing risk
profile that is presented by rising debt levels, elevated geopolitical tensions
and sluggish global economic activity. In our opinion, the fragility of the
western financial system is there for all to see with the potential for
accelerated monetary debasement of paper currencies a real danger due to the
repercussions from extreme monetary policies pursued over the past decade. We
may indeed be living a "the emperor has no clothes" moment. However, to predict
the instance when the market will focus on the exposed risks is difficult at
best.
SHARES OF GOLD MINING COMPANIES
Shares of gold mining companies have outperformed bullion through the first six
months of 2014. Gold mining industry efforts to improve cost structures and
exhibit capital discipline has helped improve investor sentiment toward the
sector. The poor performance of gold equities versus bullion since 2008 has led
to much soul searching for the gold mining industry that is starting to show
positive results in our opinion, as mining companies shed
- 2 -
unprofitable or marginal production that was being subsidized by profitable
operations and focus on cash flow generation versus number of ounces produced.
Additionally, the gold mining industry is realizing, in our opinion, that the
practice of lowering the cut-off grade mined in order to mine the marginal ounce
fails to deliver incremental value while reducing the operating leverage
investors demand from gold mining equities. It is becoming increasingly clear,
in our opinion, that with the advent of gold exchange traded funds (ETFs) over
the past ten years, shares of gold mining companies will no longer trade on pure
optionality of production and leverage to the gold price given that investors
have other vehicles to gain exposure to the gold market. Therefore, mining
companies must maintain capital discipline and seek higher rates of return on
investment in order to attract investors' capital. The problem is few projects
in the current sub $1,400 per ounce gold price environment produce the necessary
returns that allow for repayment of capital, investment in exploration, and
payment of dividends to shareholders. Consequently, the gold mining industry, in
our opinion, is set to shrink both in terms of the number of ounces produced and
the number of gold mining companies, even as gold prices rise. We believe this
environment underscores the importance of stock selection in the gold mining
sector moving forward as those companies that exhibit an ability to find and
develop quality projects will significantly outperform their peers. In our
opinion, your Fund is well positioned to benefit from the changing environment.
For example, we believe the Fund's top two holdings, Goldcorp, Inc. and
Randgold Resources Ltd. ADR (15.1% and 13.0% of Fund net assets, respectively as
of May 31, 2014) provide exposure to superior asset quality, top level
management, and new mines that will be able generate free cash flow for
management to utilize in an attempt to create shareholder value.
CONCLUSION
We believe the rationale for owning gold assets as protection against monetary
policy decisions designed to promote currency debasement remains a sound
investment strategy. In light of rising public and private sector debt levels,
the prospect for collateral damage from the Federal Reserve's extreme monetary
policies since 2008 appears greater than ever, in our opinion. Investor
complacency and disinterest in gold assets due to rising financial asset values
we believe has created an opportunistic entry point into gold related assets for
investors. In particular, we see gold mining equities as attractive at current
levels as fundamental change is taking place in the gold industry at a time when
gold mining equities are trading at historically low levels versus gold.
We appreciate your shareholding and confidence in the OCM Gold Fund and we look
forward to assisting you in meeting your investment objectives. Should you have
any questions regarding the Fund or gold, please contact your financial adviser
or you may contact us directly at 1-800-779-4681. For questions regarding your
account, please contact Shareholder Services at 1-800-628-9403.
Sincerely,
/S/ GREGORY M. ORRELL
-----------------------
Gregory M. Orrell
President and Portfolio Manager
July 24, 2014
- 3 -
INVESTING IN THE OCM GOLD FUND INVOLVES RISKS INCLUDING THE LOSS OF PRINCIPAL.
MANY OF THE COMPANIES IN WHICH THE FUND INVESTS ARE SMALLER CAPITALIZATION
COMPANIES WHICH MAY SUBJECT THE FUND TO GREATER RISK THAN SECURITIES OF LARGER,
MORE-ESTABLISHED COMPANIES, AS THEY OFTEN HAVE LIMITED PRODUCT LINES, MARKETS OR
FINANCIAL RESOURCES AND MAY BE SUBJECT TO MORE-ABRUPT MARKET MOVEMENTS. THE FUND
ALSO INVESTS IN SECURITIES OF GOLD AND PRECIOUS METALS WHICH MAY BE SUBJECT TO
GREATER PRICE FLUCTUATIONS OVER SHORT PERIODS OF TIME. THE FUND IS A
NON-DIVERSIFIED INVESTMENT COMPANY MEANING IT WILL INVEST IN FEWER SECURITIES
THAN DIVERSIFIED INVESTMENT COMPANIES AND ITS PERFORMANCE MAY BE MORE VOLATILE.
THE FUND CONTAINS INTERNATIONAL SECURITIES THAT MAY PROVIDE THE OPPORTUNITY FOR
GREATER RETURN BUT ALSO HAVE SPECIAL RISKS ASSOCIATED WITH FOREIGN INVESTING
INCLUDING FLUCTUATIONS IN CURRENCY, GOVERNMENT REGULATION, DIFFERENCES IN
ACCOUNTING STANDARDS AND LIQUIDITY.
Investor Class Performance as of May 31, 2014
--------------------------------------------------------------------------------
OCMGX OCMGX Philadelphia Gold S&P 500
(without load) (with load) and Silver Index
(XAU)
--------------------------------------------------------------------------------
Six Months 5.51% 0.76% (0.93)% 7.62%
--------------------------------------------------------------------------------
One Year (12.58)% (16.51)% (19.20)% 20.45%
--------------------------------------------------------------------------------
3 Year Annualized (22.80)% (23.97)% (24.54)% 15.15%
--------------------------------------------------------------------------------
5 Year Annualized (7.16)% (8.01)% (10.60)% 18.40%
--------------------------------------------------------------------------------
10 Year Annualized 4.64% 4.16% 0.73% 7.77%
--------------------------------------------------------------------------------
Advisor Class Performance as of May 31, 2014
--------------------------------------------------------------------------------
OCMAX Philadelphia Gold and S&P 500
Silver Index (XAU)
--------------------------------------------------------------------------------
Six Months 6.01% (0.93)% 7.62%
--------------------------------------------------------------------------------
One Year (11.99)% (19.20)% 20.45%
--------------------------------------------------------------------------------
3 Year Annualized (22.35)% (24.54)% 15.15%
--------------------------------------------------------------------------------
Since Inception (10.25)% (13.34)% 15.11%
Annualized*
--------------------------------------------------------------------------------
* Inception: April 1, 2010
THE PERFORMANCE DATA QUOTED ABOVE REPRESENTS PAST PERFORMANCE. CURRENT
PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE DATA QUOTED ABOVE. PAST
PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. THE INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE SO THAT INVESTOR'S SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. THE FUND'S TOTAL
ANNUAL OPERATING EXPENSES FOR THE OCM GOLD FUND INVESTOR CLASS AND ADVISOR CLASS
ARE 2.22% AND 1.69% RESPECTIVELY. PLEASE REVIEW THE FUND'S PROSPECTUS FOR MORE
INFORMATION REGARDING THE FUND'S FEES AND EXPENSES. FOR PERFORMANCE INFORMATION
CURRENT TO THE MOST RECENT MONTH-END, PLEASE CALL TOLL-FREE 800-628-9403. THE
RETURNS SHOWN INCLUDE THE REINVESTMENT OF ALL DIVIDENDS BUT DO NOT REFLECT THE
DEDUCTION OF TAXES THAT A SHAREHOLDER WOULD PAY ON FUND DISTRIBUTIONS OR THE
REDEMPTION OF FUND SHARES.
1 The Philadelphia Gold and Silver Index (XAU) is an unmanaged
capitalization-weighted index composed of 16 companies listed on U.S.
exchanges involved in the gold and silver mining industry. The index is
generally considered as representative of the gold and silver share market.
2 The S&P 500 Index, a registered trademark of McGraw-Hill Co., Inc. is a
market capitalization-weighted index of 500 widely held common stocks. You
cannot invest directly in an index.
- 4 -
OCM GOLD FUND
SCHEDULE OF INVESTMENTS
MAY 31, 2014
(UNAUDITED)
Shares Value
------ -----
COMMON STOCKS 91.0%
MAJOR GOLD PRODUCERS 29.5%
152,722 AngloGold Ashanti Ltd. ADR* ................... $ 2,411,480
400,000 Gold Fields Ltd. ADR .......................... 1,416,000
450,050 Goldcorp, Inc.................................. 10,517,669
258,200 Kinross Gold Corp.* ........................... 975,996
107,961 Newmont Mining Corp............................ 2,471,227
280,000 Sibanye Gold Ltd. ADR ......................... 2,749,600
-------------
20,541,972
-------------
INTERMEDIATE/MID-TIER GOLD PRODUCERS 33.8%
127,250 Agnico-Eagle Mines Ltd......................... 3,848,040
250,000 Alacer Gold Corp............................... 546,436
145,200 AuRico Gold, Inc............................... 503,844
500,000 Centerra Gold, Inc............................. 2,125,795
360,833 Eldorado Gold Corp............................. 2,074,790
600,000 Endeavour Mining Corp.* ....................... 403,947
520,200 IAMGOLD Corp................................... 1,586,610
149,900 New Gold, Inc.* ............................... 791,472
122,500 Randgold Resources Ltd. ADR ................... 9,056,425
348,250 Yamana Gold, Inc............................... 2,563,120
-------------
23,500,479
-------------
JUNIOR GOLD PRODUCERS 7.4%
100,000 Alamos Gold, Inc............................... 827,000
175,000 Argonaut Gold Ltd.* ........................... 597,159
568,400 B2Gold Corp.* ................................. 1,378,670
300,000 Dundee Precious Metals, Inc.* ................. 993,268
500,000 Mandalay Resources Corp........................ 419,626
1,281,500 Wesdome Gold Mines Ltd.* ...................... 886,401
-------------
5,102,124
-------------
EXPLORATION AND DEVELOPMENT COMPANIES 2.7%
500,000 Amarillo Gold Corp.* .......................... 64,558
2,190,000 Avala Resources Ltd.* ......................... 141,381
150,000 MAG Silver Corp.* ............................. 1,056,903
300,000 Sabina Silver Corp.* .......................... 166,006
5,100,040 Sutter Gold Mining, Inc.* ..................... 470,353
-------------
1,899,201
-------------
PRIMARY SILVER PRODUCERS 10.5%
200,000 Fortuna Silver Mines, Inc.* ................... 772,849
210,000 Silver Wheaton Corp............................ 4,361,524
100,000 Tahoe Resources, Inc.* ........................ 2,074,149
5,600 Tahoe Resources, Inc.*^ ....................... 116,368
-------------
7,324,890
-------------
OTHER 7.1%
14,800 Franco-Nevada Corp............................. 686,699
10,200 Franco-Nevada Corp.^ .......................... 474,708
60,000 Royal Gold, Inc................................ 3,763,200
-------------
4,924,607
-------------
TOTAL COMMON STOCKS
(Cost $30,565,231) .......................... 63,293,273
-------------
See notes to financial statements.
- 5 -
OCM GOLD FUND
SCHEDULE OF INVESTMENTS
AS OF MAY 31, 2014
(UNAUDITED)
Shares Value
------ -----
EXCHANGE TRADED FUND 6.5%
37,500 SPDR Gold Trust* .............................. 4,516,125
-------------
TOTAL EXCHANGE TRADED FUND
(Cost $1,657,875) ........................... 4,516,125
-------------
WARRANTS 0.0%
75,000 Veris Gold Corp.*
Exercise Price 1.95 CAD,
Exp. 12/18/2016 ............................. 2,075
-------------
TOTAL WARRANTS ................................ 2,075
-------------
(Cost $0)
SHORT-TERM INVESTMENT 3.1%
2,148,125 UMB Money Market Fiduciary, 0.01% ............. 2,148,125
-------------
TOTAL SHORT-TERM INVESTMENT
(Cost $2,148,125) .......................... 2,148,125
-------------
TOTAL INVESTMENTS
(Cost $34,371,231) ................. 100.6% 69,959,598
LIABILITIES LESS OTHER ASSETS ........ (0.6)% (397,468)
-------------
TOTAL NET ASSETS ........................100.0% $ 69,562,130
=============
ADR - American Depository Receipt.
CAD - Canadian Dollars.
* Non-income producing security.
^ Denoted investment is a Canadian security traded on U.S. stock exchange.
See notes to financial statements.
- 6 -
OCM GOLD FUND
SCHEDULE OF INVESTMENTS -- MAY 31, 2014 (CONTINUED)
(UNAUDITED)
SUMMARY OF INVESTMENTS BY COUNTRY
Percent of
Investment
Country Value Securities
------------------------------------------------------------------
Canada $ 41,023,469 58.6%
Cayman Islands 403,947 0.6
Jersey 9,056,425 13.0
South Africa 6,577,080 9.4
United States(1) 12,898,677 18.4
--------------------------------
Total $ 69,959,598 100.0%
================================
(1) Includes short-term investments.
See notes to financial statements.
- 7 -
OCM GOLD FUND
STATEMENT OF ASSETS AND LIABILITIES - MAY 31, 2014
(UNAUDITED)
ASSETS:
Investments in unaffiliated issuers, at value
(cost $34,371,231) .................................. $ 69,959,598
Interest and dividends receivable .................... 89,825
Receivable for fund shares sold ...................... 33,856
Prepaid expenses and other assets .................... 32,890
-------------------
Total assets ....................................... 70,116,169
-------------------
LIABILITIES:
Investment securities purchased ...................... 205,137
Payable for fund shares redeemed ..................... 91,706
Investment adviser fees .............................. 58,823
Accrued distribution fees ............................ 144,415
Accrued Trustees' fees ............................... 2,487
Accrued expenses and other liabilities ............... 51,471
-------------------
Total liabilities ................................. 554,039
-------------------
Net Assets ........................................ $ 69,562,130
===================
NET ASSETS CONSIST OF:
Shares of beneficial interest, no par value:
unlimited shares authorized ........................ $ 33,772,149
Undistributed net investment loss .................... (2,335,106)
Accumulated net realized gain on investments
and foreign currency transactions .................. 2,536,682
Net unrealized appreciation on investments and
foreign currency translations ...................... 35,588,405
-------------------
Net Assets ........................................ $ 69,562,130
===================
CALCULATION OF MAXIMUM OFFERING PRICE:
INVESTOR CLASS:
Net asset value and redemption price per share .... $ 11.88
Maximum sales charge (4.50% of offering price) .... 0.56
-------------------
Offering price to public .......................... $ 12.44
-------------------
Shares outstanding ................................ 4,369,832
===================
ADVISOR CLASS:
Net asset value and redemption price per share .... $ 12.18
-------------------
Shares outstanding ................................ 1,446,875
===================
Total shares outstanding .......................... 5,816,707
===================
See notes to financial statements.
- 8 -
OCM GOLD FUND
STATEMENT OF OPERATIONS - SIX MONTHS ENDED MAY 31, 2014
(UNAUDITED)
Investment Income
Interest ............................................. $ 118
Dividend (net of foreign withholding taxes of $57,106) 447,852
-------------------
Total investment income ........................... 447,970
-------------------
EXPENSES
Investment advisory fees ............................. 335,802
Distribution fees - Investor Class ................... 233,562
Distribution fees - Advisor Class .................... 19,674
Fund administration and accounting fees .............. 63,801
Transfer agent fees and expenses ..................... 52,409
Professional fees .................................... 30,154
Federal and state registration fees .................. 16,771
Chief Compliance Officer fees ........................ 12,970
Custody fees ......................................... 10,977
Reports to shareholders .............................. 10,090
Trustees' fees ....................................... 4,987
Other expenses ....................................... 4,475
-------------------
Total expenses .................................... 795,672
-------------------
Net investment loss ............................... (347,702)
-------------------
REALIZED AND UNREALIZED GAIN/(LOSS) ON INVESTMENTS:
Net realized loss on investments and
foreign currency transactions ....................... (208)
Net change in unrealized appreciation on
investments and foreign currency translations ....... 3,619,874
-------------------
NET GAIN ON INVESTMENTS ......................... 3,619,666
-------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS .............. $ 3,271,964
===================
See notes to financial statements.
- 9 -
OCM GOLD FUND
STATEMENTS OF CHANGES IN NET ASSETS
SIX MONTHS ENDED YEAR ENDED
MAY 31,2014 NOVEMBER 30,
(UNAUDITED) 2013
----------------- ------------------
OPERATIONS:
Net investment loss ..................................$ (347,702) $ (708,463)
Net realized gain/(loss) on investments
and foreign currency transactions .................. (208) 3,273,721
Net change in unrealized appreciation/depreciation
on investments and for currency translations ....... 3,619,874 (66,178,788)
----------------- ------------------
Net increase/(decrease) in net assets
resulting from operations .......................... 3,271,964 (63,613,530)
----------------- ------------------
DISTRIBUTIONS PAID TO SHAREHOLDERS
INVESTOR CLASS:
Distributions paid from net realized gains ........ -- (2,269,221)
----------------- ------------------
Total distributions from Investor Class ........... -- (2,269,221)
----------------- ------------------
ADVISOR CLASS:
Distributions paid from net realized gains ........ -- (324,079)
----------------- ------------------
Total distributions from Advisor Class ............ -- (324,079)
----------------- ------------------
Total distributions ............................... -- (2,593,300)
----------------- ------------------
FUND SHARE TRANSACTIONS
INVESTOR CLASS:
Net proceeds from shares sold ...................... 1,322,457 2,805,157
Distributions reinvested ........................... -- 2,094,448
Payment of shares redeemed(1) ...................... (4,456,157) (20,515,001)
----------------- ------------------
Net decrease in net assets from
Investor Class share transactions ................ (3,133,700) (15,615,396)
----------------- ------------------
ADVISOR CLASS:
Net proceeds from shares sold ...................... 6,833,448 4,587,915
Distributions reinvested ........................... -- 294,659
Payment of shares redeemed(2) ...................... (1,645,434) (1,432,205)
----------------- ------------------
Net increase in net assets from
Advisor Class share transactions .................. 5,188,014 3,450,369
----------------- ------------------
Net increase/(decrease) in net assets
from Fund share transactions ...................... 2,054,314 (12,165,027)
----------------- ------------------
TOTAL INCREASE/(DECREASE) IN NET ASSETS ............ 5,326,278 (78,371,857)
See notes to financial statements.
- 10 -
OCM GOLD FUND
STATEMENTS OF CHANGES IN NET ASSETS
(CONTINUED)
SIX MONTHS ENDED YEAR ENDED
MAY 31,2014 NOVEMBER 30,
(UNAUDITED) 2013
----------------- ------------------
NET ASSETS, BEGINNING OF PERIOD .........................$ 64,235,852 $ 142,607,709
----------------- ------------------
NET ASSETS, END OF PERIOD ............................... 69,562,130 64,235,852
================= ==================
ACCUMULATED NET INVESTMENT LOSS ........................$ (2,335,106) $ (1,987,404)
================= ==================
TRANSACTIONS IN SHARES
INVESTOR CLASS:
Shares sold ........................................ 103,757 181,993
Shares issued on reinvestment of distributions ..... -- 104,305
Shares redeemed .................................... (372,764) (1,425,698)
----------------- ------------------
Net decrease in Investor Class shares outstanding .. (269,007) (1,139,400)
================= ==================
ADVISOR CLASS:
Shares sold ........................................ 532,811 338,942
Shares issued on reinvestment of distributions ..... -- 14,451
Shares redeemed .................................... (130,838) (95,809)
----------------- ------------------
Net increase in Advisor Class shares outstanding ... 401,973 257,584
================= ==================
Net increase/(decrease) in Fund shares outstanding . 132,966 (881,816)
================= ==================
(1) Net of redemption fees of $79 for the six months ended May 31, 2014 and
$5,270 for the year ended November 30, 2013, respectively.
(2) Net of redemption fees of $3,207 for the six months ended May 31, 2014 and
$5,492 for the year ended November 30, 2013, respectively.
See notes to financial statements.
- 11 -
OCM GOLD FUND
NOTES TO FINANCIAL STATEMENTS - MAY 31, 2014
(UNAUDITED)
NOTE 1. ORGANIZATION
OCM Mutual Fund (the "Trust") is registered under the Investment Company
Act of 1940, as amended, as an open-end management investment company. The
Trust was organized as a Massachusetts business trust on January 6, 1984 and
consists of the OCM Gold Fund (the "Fund"). The investment objective for the
Fund is long-term growth of capital through investing primarily in equity
securities of domestic and foreign companies engaged in activities related to
gold and precious metals.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Fund in the preparation of its financial statements.
SECURITY VALUATION - Portfolio securities that are listed on national
securities exchanges, other than the NASDAQ Stock Market LLC, are valued at the
last sale price as of the close of business of such securities exchanges, or, in
the absence of recorded sales, at the average of readily available closing bid
and ask prices on such exchanges. NASDAQ Global Select Market, Global Market and
Capital Market securities are valued at the NASDAQ Official Closing Price
("NOCP"). If a NOCP is not issued for a given day, these securities are valued
at the average of readily available closing bid and asked prices. Unlisted
securities are valued at the average of the quoted bid and ask prices in the
over-the-counter market. Short-term investments which mature in less than 60
days are valued at amortized cost (unless the Board of Trustees determines that
this method does not represent fair value). Short-term investments which mature
after 60 days are valued at market. Securities and other assets for which market
quotations are not readily available are valued at fair value as determined in
good faith by the investment adviser under procedures established by and under
the general supervision and responsibility of the Trust's Board of Trustees. For
each investment that is fair valued, the investment adviser considers, to the
extent applicable, various factors including, but not limited to, the type of
security, the financial condition of the company, comparable companies in the
public market, the nature and duration of the cause for a quotation not being
readily available and other relevant factors.
Under FAIR VALUE MEASUREMENTS AND DISCLOSURES, various inputs are used in
determining the value of the Fund's investments. These inputs are summarized
into three broad levels as described below:
o Level 1 - quoted prices in active markets for identical securities
o Level 2 - other significant observable inputs (including quoted prices
for similar securities, interest rates, and evaluated quotation
obtained from pricing services)
o Level 3 - significant unobservable inputs (including the Fund's own
assumptions in determining the fair value of investments).
- 12 -
OCM GOLD FUND
NOTES TO FINANCIAL STATEMENTS - MAY 31, 2014 (CONTINUED)
(UNAUDITED)
The inputs or methodology used for valuing securities are not an indication of
the risk associated with investing in those securities. The following is a
summary of the inputs used, as of May 31, 2014, in valuing the Fund's assets:
------------------------------------------------- ---------------- -------------- ----------- --------------
SECTOR LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
------------------------------------------------- ---------------- -------------- ----------- --------------
COMMON STOCKS
------------------------------------------------- ---------------- -------------- ----------- --------------
Major Gold Producers $20,541,972 $ - $ - $20,541,972
------------------------------------------------- ---------------- -------------- ----------- --------------
Intermediate/Mid-Tier Gold Producers 23,500,479 - - 23,500,479
------------------------------------------------- ---------------- -------------- ----------- --------------
Junior Gold Producers 5,102,124 - - 5,102,124
------------------------------------------------- ---------------- -------------- ----------- --------------
Exploration and Development Companies 1,899,201 - - 1,899,201
------------------------------------------------- ---------------- -------------- ----------- --------------
Primary Silver Producers 7,324,890 - - 7,324,890
------------------------------------------------- ---------------- -------------- ----------- --------------
Other 4,924,607 - - 4,924,607
------------------------------------------------- ---------------- -------------- ----------- --------------
EXCHANGE TRADED FUND 4,516,125 - - 4,516,125
------------------------------------------------- ---------------- -------------- ----------- --------------
SHORT-TERM INVESTMENT 2,148,125 - - 2,148,125
------------------------------------------------- ---------------- -------------- ----------- --------------
WARRANTS
------------------------------------------------- ---------------- -------------- ----------- --------------
Junior Gold Producers 2,075 - - 2,075
------------------------------------------------- ---------------- -------------- ----------- --------------
TOTAL $69,959,598 $ - $ - $69,959,598
------------------------------------------------- ---------------- -------------- ----------- --------------
There were no Level 2 or 3 securities as of May 31, 2014. The Fund
recognizes transfers between levels at the end of the reporting period. There
were no transfers at period end.
FOREIGN CURRENCY - Investment securities and other assets and liabilities
denominated in foreign currencies are translated into U.S. dollar amounts at the
date of valuation. Purchases and sales of investment securities and income and
expense items denominated in foreign currencies are translated into U.S. dollar
amounts on the respective dates of such transactions. The Fund does not isolate
that portion of the results of operations resulting from changes in foreign
exchange rates on investments from the fluctuations arising from changes in
market prices of securities held. Such fluctuations for the six months ended May
31, 2014 are included within the realized and unrealized gain/loss on
investments section of the Statement of Operations.
Reported net realized foreign exchange gains or losses arise from sales of
foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amounts of dividends, interest and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent of the amounts actually received or
paid. Net unrealized foreign exchange gains and losses arise from changes in the
fair value of assets and liabilities, other than investments in securities at
fiscal period end, resulting from changes in exchange rates. Such fluctuations
for the six months ended May 31, 2014 are included within the realized and
unrealized gain/ loss on investments section of the Statement of Operations.
FEDERAL INCOME TAXES - The Fund intends to comply with the requirements of
the Internal Revenue Code necessary to qualify as a regulated investment company
and to make the requisite distributions of income to its shareholders which will
be sufficient to relieve it from all or substantially all federal income taxes.
- 13 -
OCM GOLD FUND
NOTES TO FINANCIAL STATEMENTS - MAY 31, 2014 (CONTINUED)
(UNAUDITED)
ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES ("Income Tax Statement")
requires an evaluation of tax positions taken (or expected to be taken) in the
course of preparing a Fund's tax returns to determine whether these positions
meet a "more-likely-than-not" standard that, based on the technical merits, have
a more than fifty percent likelihood of being sustained by a taxing authority
upon examination. A tax position that meets the "more-likely-than-not"
recognition threshold is measured to determine the amount of benefit to
recognize in the financial statements. The Fund's policy is to classify interest
and penalties associated with underpayment of federal and state income taxes, if
any, as income tax expense on the Statement of Operations. As of May 31, 2014,
the Fund did not have any interest or penalties associated with the underpayment
of any income taxes.
The Income Tax Statement requires management of the Fund to analyze all
open tax years, fiscals years 2010-2013 as defined by IRS statute of limitations
for all major jurisdictions, including federal tax authorities and certain state
tax authorities. As of and during the six months ended May 31, 2014, the Fund
did not have a liability for any unrecognized tax benefits. The Fund has no
examination in progress and is not aware of any tax positions for which it is
reasonably possible that the total amounts of unrecognized tax benefits will
significantly change in the next twelve months.
SHARE CLASSES - The Fund offers two classes of shares, Investor Class and
Advisor Class. The outstanding shares of the Fund on April 1,2010 were renamed
"Investor Class shares." The Advisor Class shares commenced operations on April
1, 2010. The two classes represent interests in the same portfolio of
investments and have the same rights. Investor Class shares are subject to an
annual 12b-1 fee of up to 0.99% of the Fund's average daily net assets allocable
to Investor Class shares, whereas Advisor Class shares are subject to an annual
12b-1 fee of up to 0.25% of the Fund's average daily net assets allocable to
Advisor Class shares. Income, expenses (other than expenses attributable to a
specific class) and realized and unrealized gains and losses on investments are
allocated to each class of shares in proportion to their relative shares
outstanding.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME - Securities transactions are
accounted for on a trade date basis. Realized gains and losses on sales of
securities are calculated on the identified cost basis. Dividend income is
recorded on the ex-dividend date and interest income is recorded on an accrual
basis.
DISTRIBUTIONS TO SHAREHOLDERS - The character of distributions made during
the year from net investment income or net realized gains may differ from the
characterization for federal income tax purposes due to differences in the
recognition of income, expense or gain items for financial statement and tax
purposes. To the extent that these differences are attributable to permanent
book and tax accounting differences, the components of net assets have been
adjusted.
REDEMPTION FEE - A 1.50% redemption fee is retained by the Fund to offset
transaction costs and other expenses associated with short-term investing. The
fee is imposed on redemptions or exchanges of shares held less than three months
from their purchase date. The Fund records the fee as a reduction of shares
redeemed and as a credit to shares of beneficial interest. For the six months
ended May 31, 2014, the Investor Class and the Advisor Class received $79 and
$3,207 in redemption fees, respectively.
GUARANTEES AND INDEMNIFICATIONS - In the normal course of business, the
Fund enters into contracts with service providers that contain general
indemnification clauses. The Fund's maximum exposure under these arrangements is
unknown as this would involve future claims against the Fund that have not yet
occurred. Based on experience, the Fund expects the risk of loss to be remote.
USE OF ESTIMATES - The preparation of financial statements in conformity
with accounting principles generally accepted in the United States of America
requires management to make 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.
DERIVATIVE INSTRUMENTS - Equity securities in the gold mining industry,
particularly the smaller companies, may occasionally issue warrants as part of
their capital structure. A warrant gives the holder the right to purchase the
underlying equity at the exercise price until the expiration date of the
warrant. The Fund may hold such warrants for exposure to smaller companies in
the portfolio or other reasons associated with the Fund's overall objective of
long-term growth, though warrants will typically not be a significant part of
the Fund's portfolio. The Fund's maximum risk in holding warrants is the loss of
the entire amount paid for the warrants. The Fund did not have any transactions
involving warrants during the six months ended May 31, 2014. At May 31, 2014,
the Fund held warrants as listed on the Schedule of Investments.
- 14 -
OCM GOLD FUND
NOTES TO FINANCIAL STATEMENTS - MAY 31, 2014 (CONTINUED)
(UNAUDITED)
DISCLOSURES ABOUT OFFSETTING ASSETS AND LIABILITIES requires an entity to
disclose information about offsetting and related arrangements to enable users
of its financial statements to understand the effect of those arrangements on
its financial position. The guidance requires retrospective application for all
comparative periods presented. Management has evaluated the impact on the
financial statement disclosures and determined that there is no effect.
SUBSEQUENT EVENTS - Management has evaluated subsequent events and
determined there were no subsequent events that require recognition or
disclosure in the financial statements.
NOTE 3. INVESTMENT ADVISORY AGREEMENT AND AFFILIATED PARTIES
The Fund has an investment advisory agreement with Orrell Capital
Management, Inc. ("OCM"). Under the agreement, the Fund pays OCM a fee computed
daily and payable monthly, at the following annual rates based upon average
daily net assets:
ASSETS FEE RATE
------ --------
$0 to $250 million . . . . . . . . . . . . 0.950%
$250 million to $500 million . . . . . . . . . 0.800%
$500 million to $1 billion . . . . . . . . . 0.700%
Over $1 billion . . . . . . . . . . . . . 0.600%
The Fund does not compensate Trustees and Officers affiliated with OCM. For
the six months ended May 31, 2014, the expenses accrued for Trustees who are not
affiliated with OCM are reported on the Statement of Operations. The Fund pays
the salary and related expenses of the Fund's Chief Compliance Officer. The
expenses accrued for the Chief Compliance Officer are reported on the Statement
of Operations.
NOTE 4. DISTRIBUTION AGREEMENT AND PLAN
The Trust has adopted a Distribution Plan (the "Plan") pursuant to Rule
12b-1 under the Investment Company Act of 1940, as amended. The Plan authorizes
the Fund to reimburse the distributor for marketing expenses incurred in
distributing shares of the Fund, including the cost of printing sales material
and making payments to dealers of the Fund's Investor Class and Advisor Class,
in any fiscal year, subject to limits of 0.99% and 0.25%, respectively, of the
average daily net assets of each respective class. For the six months ended May
31, 2014, the Investor Class and the Advisor Class accrued $233,562 and $19,674,
respectively, in expenses under the Plan.
NOTE 5. PURCHASES AND SALES OF SECURITIES
Purchases and sales of investment securities (excluding short-term
securities and U.S. government obligations) for the six months ended May 31,
2014 were $3,407,596 and $0, respectively. There were no purchases or sales of
U.S. government obligations.
NOTE 6. FEDERAL INCOME TAX INFORMATION
At May 31, 2014, gross unrealized appreciation and depreciation of
investments owned by the Fund, based on cost for federal income tax purposes
were as follows:
Cost of investments.............................. $35,781,277
===========
Unrealized appreciation.......................... $37,454,320
Unrealized depreciation.......................... (3,275,999)
Unrealized appreciation on foreign currency.. (106)
------------
Net unrealized appreciation on investments... $34,178,215
============
The difference between cost amounts for financial statement and federal
income tax purposes is due primarily to investments in passive foreign
investment companies ("PFICs").
- 15 -
OCM GOLD FUND
NOTES TO FINANCIAL STATEMENTS - MAY 31, 2014 (CONTINUED)
(UNAUDITED)
The tax character of distributions paid during the fiscal years ended
November 30, 2013 and 2012 was as follows:
2013 2012
----- ----
Ordinary income .................................. $ -- $ --
Net long-term capital gains ...................... 2,593,300 7,122,610
------------- ----------
Total distributions .............................. $ 2,593,300 $7,122,610
============= ==========
As of November 30, 2013 the components of accumulated earnings on a tax
basis were as follows:
Undistributed ordinary income ............... $ --
Undistributed long-term gains ............... 2,492,975
---------------
Tax accumulated earnings .................... 2,492,975
Accumulated capital and other losses ........ (710,194)
Unrealized appreciation on investments ...... 30,735,236
---------------
Total accumulated earnings .................. $ 32,518,017
===============
The Fund has $710,194 in Qualified late-year losses, which are deferred
until fiscal year 2014 for tax purposes. Net late-year ordinary losses incurred
after December 31 and within the taxable year and net late-year specified losses
incurred after October 31 and within the taxable year are deemed to arise on the
first day of the Fund's next taxable year.
NOTE 7. CONCENTRATION OF RISK
Investing in foreign securities involves certain risks not necessarily
found in U.S. markets. These include risks associated with adverse changes in
economic, political, regulatory and other conditions, changes in currency
exchange rates, exchange control regulations, expropriation of assets or
nationalization, imposition of withholding taxes on dividend or interest
payments or capital gains, and possible difficulty in obtaining and enforcing
judgments against foreign entities. Further, issuers of foreign securities are
subject to different, and often less comprehensive, accounting, reporting, and
disclosure requirements than domestic issuers.
As the Fund concentrates its investments in the gold mining industry, a
development adversely affecting the industry (for example, changes in the mining
laws which increases production costs or a significant decrease in the market
price of gold) would have a greater adverse effect on the Fund than it would if
the Fund invested in a number of different industries.
NOTE 8. ILLIQUID SECURITIES
The Fund may invest up to 15% of net assets in securities for which there
is no readily available market ("illiquid securities"). The 15% limitation
includes securities whose disposition would be subject to legal restrictions
("restricted securities"). Illiquid and restricted securities often have a
market value lower than the market price of unrestricted securities of the same
issuer and are not readily marketable without some time delay. This could result
in the Fund being unable to realize a favorable price upon disposition of such
securities and in some cases might make disposition of such securities at the
time desired by the Fund impossible.
- 16 -
OCM GOLD FUND
Financial Highlights Investor Class
SIX MONTHS END YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
MAY 31, 2014 NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30,
(UNAUDITED) 2013 2012 2011 2010 2009
---------- ---------- ----------- ---------- ----------- ----------
Per Share Operating Performance
(For a share outstanding throughout each period)
Net asset value,
beginning of period $ 11.26 $ 21.68 $ 28.49 $ 30.53 $ 24.68 $ 12.35
---------- ---------- ----------- ---------- ----------- ----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (0.07)(1) (0.27) (0.25) (0.29) (0.43) (0.29)
Net realized and unrealized
gain/(loss) on investments
and foreign currency
transactions 0.69 (9.75) (5.48) 0.76 6.81 12.65
---------- ---------- ----------- ---------- ----------- ----------
Total from investment operations 0.62 (10.02) (5.73) 0.47 6.38 12.36
---------- ---------- ----------- ---------- ----------- ----------
LESS DISTRIBUTIONS:
Dividends from net investment income -- -- -- -- -- --
Distribution from net realized gains -- (0.40) (1.08) (2.51) (0.53) (0.03)
---------- ---------- ----------- ---------- ----------- ----------
Total distributions -- (0.40) (1.08) (2.51) (0.53) (0.03)
---------- ---------- ----------- ---------- ----------- ----------
NET ASSET VALUE, END OF PERIOD $ 11.88 $ 11.26 $ 21.68 $ 28.49 $ 30.53 $ 24.68
========== ========== =========== ========== =========== ==========
TOTAL RETURN* 5.51%(2) (47.03)% (20.27)% 1.70% 26.70% 100.14%
Ratios/Supplemental Data:
Net assets, end of year (in 000's) $ 51,932 $ 52,231 $ 125,286 $ 168,305 $ 175,802 $ 159,833
Ratio of expenses to
average net assets 2.39%(3) 2.22% 1.99% 1.73% 1.93% 1.94%
Ratio of net investment loss
to average net assets (1.12)%(3) (0.85)% (1.04)% (1.03)% (1.57)% (1.59)%
Portfolio turnover rate 0%(2) 8% 1% 5% 12% 6%
----------------------------------
*Assumes no sales charge
(1) Based on average shares method.
(2) Not annualized.
(3) Annualized.
See notes to financial statements.
- 17 -
OCM GOLD FUND
Financial Highlights Advisor Class
FOR THE PERIOD
SIX MONTHS END YEAR ENDED YEAR ENDED YEAR ENDED APRIL 1, 2010#--
MAY 31, 2014 NOVEMBER 30, NOVEMBER 30, NOVEMBER 30, NOVEMBER 30,
(UNAUDITED) 2013 2012 2011 2010
----------- ----------- ------------- ------------- --------------
Per Share Operating Performance
(For a share outstanding throughout each period)
Net asset value, beginning of period $ 11.49 $ 22.00 $ 28.74 $ 30.65 $ 22.24
----------- ----------- ------------- ------------- --------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income/(loss) (0.03)(1) (0.08) (0.12) (0.18) (0.13)
Net realized and unrealized
gain/(loss) on investments and
foreign currency transactions 0.72 (10.03) (5.54) 0.78 8.54
----------- ----------- ------------- ------------- --------------
Total from investment operations 0.69 (10.11) (5.66) 0.60 8.41
----------- ----------- ------------- ------------- --------------
LESS DISTRIBUTIONS:
Dividends from net investment income -- -- -- -- --
Distribution from net realized gains -- (0.40) (1.08) (2.51) --
----------- ----------- ------------- ------------- --------------
Total distributions -- (0.40) (1.08) (2.51) --
----------- ----------- ------------- ------------- --------------
NET ASSET VALUE, END OF PERIOD $ 12.18 $ 11.49 $ 22.00 $ 28.74 $ 30.65
=========== =========== ============= ============= ==============
TOTAL RETURN 6.01%(2) (46.75)% (19.83)% 2.15% 37.81%(2)
Ratios/Supplemental Data:
Net assets, end of year (in 000's) $ 17,630 $ 12,005 $ 17,322 $ 20,328 $ 20,386
Ratio of expenses to average
net assets 1.78%(3) 1.69% 1.48% 1.30% 1.34%(3)
Ratio of net investment loss
to average net assets (0.51)(3) (0.31)% (0.52)% (0.60)% (0.98)(3)
Portfolio turnover rate 0%(2) 8% 1% 5% 12%(2)
----------------------------------
# Inception date of Advisor Class.
(1) Based on average shares method.
(2) Not annualized.
(3) Annualized.
See notes to financial statements.
- 18 -
OCM GOLD FUND
EXPENSE EXAMPLE -- FOR THE PERIOD ENDED MAY 31, 2014
(UNAUDITED)
As a shareholder of the OCM Gold Fund (the "Fund"), you incur two types of
costs: (1) transaction costs, including sales charges (loads) on purchase
payments and redemption fees on certain redemptions; and (2) ongoing costs,
including management fees; distribution (12b-1) fees; and other Fund expenses.
This Example is intended to help you understand your ongoing costs (in dollars)
of investing in the Fund and to compare these costs with the ongoing costs of
investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning
of the period and held for the entire period from December 1, 2013 to May 31,
2014 (the "period").
ACTUAL EXPENSES
The row titled "Actual" in the table below provides information about
actual account values and actual expenses. You may use this information,
together with the amount you invested, to estimate the expenses you paid over
the period. Simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 equals 8.6), then multiply the result by the
number in the appropriate line for your share class under the heading entitled
"Expenses Paid During the Period" to estimate the expenses you paid on your
account during the periods.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The row titled "Hypothetical" in the table below provides information about
hypothetical account values and hypothetical expenses based on each class'
actual expense ratio and an assumed rate of return of 5% per year before
expenses, which is not each class' actual return. The hypothetical account
values and expenses may not be used to estimate the actual ending account
balance or expenses you paid for the period. You may use this information to
compare the ongoing costs of investing in the classes of the Fund and other
funds. To do so, compare these 5% hypothetical examples 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) and redemption fees. Therefore, the hypothetical lines of
the table are useful in comparing the 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 could have been higher.
EXPENSES PAID DURING THE PERIOD
Expenses paid
Beginning Ending during the
account value account value period ended
December 1, 2013 May 31, 2014 May 31, 2014*
INVESTOR CLASS
Actual $1,000.00 $1,055.10 $12.23
Hypothetical
(5% return before expenses) 1,000.00 1,013.10 11.98
ADVISOR CLASS
Actual 1,000.00 1,060.10 9.13
Hypothetical
(5% return before expenses) 1,000.00 1,016.13 8.94
* Expenses are equal to the Investor Class' and Advisor Class' annualized
expense ratios of 2.39% and 1.78%, respectively, for the period, multiplied
by the average account value over the period, multiplied by 182/365 (to
reflect the one-half year period).
- 19 -
OCM GOLD FUND
OTHER INFORMATION
(UNAUDITED)
INVESTMENTS BY SECTOR AS OF MAY 31, 2014
AS A PERCENTAGE OF TOTAL INVESTMENTS
INTERMEDIATE/MID-TIER GOLD PRODUCERS 33.6%
MAJOR GOLD PRODUCERS 29.4%
JUNIOR GOLD PRODUCERS 7.3%
EXPLORATION AND DEVELOPMENT COMPANIES 2.7%
PRIMARY SILVER PRODUCERS 10.5%
EXCHANGE TRADED FUND 6.4%
OTHER 7.0%
SHORT -TERM INVESTMENT 3.1%
A description of the Fund's proxy voting policies and procedures and a
record of the Fund's proxy votes for the year ended June 30, 2013 are available
without charge, upon request by calling toll free 1-800-779-4681 and on the
Securities and Exchange Commission's (SEC) website at http://www.sec.gov.
Quarterly Filings of Portfolio Holdings
The Fund will file its complete schedule of investments with the SEC for
the first and third quarters of each fiscal year on Form N-Q. The Fund's Forms
N-Q will be available on the EDGAR database on the SEC's website at
http://www.sec.gov. These Forms may also be reviewed and copied at the SEC's
Public Reference Room in Washington, D.C. Information about the operation of the
Public Reference Room may be obtained by calling 1-800-SEC-0330.
- 20 -
OCM Gold Fund
Distributed by:
Northern Lights Distributors, LLC
17605 Wright Street
Omaha, NE 68130 2244-NLD-7/28/2014
ITEM 2. CODE OF ETHICS.
Not applicable to semi-annual reports.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable to semi-annual reports.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Not applicable to semi-annual reports.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not applicable to semi-annual reports.
ITEM 6. SCHEDULE OF INVESTMENTS
The schedules of investments in securities in unaffiliated issuers are included
as part of the reports to shareholders filed under Item 1.
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. SUBMISSIONS OF MATTERS TO A VOTE OF SECURITY HOLDERS
As of the end of the period covered by this report, the registrant had not
adopted any procedures by which shareholders may recommend nominees to the
registrant's Board of Directors.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The registrant's certifying officer has concluded that the registrant's
disclosure controls and procedures (as defined in Rule 30a-2 under the
Investment Company Act of 1940 (the "Act")) are effective in design and
operation and are sufficient to form the basis of the certifications
required by Rule 30a-2 under the Act, based on their evaluation of these
disclosure controls and procedures within 90 days of the filing date of
this report on Form N-CSR.
(b) Not applicable.
ITEM 12. EXHIBITS.
(a)(1) Code of Ethics - Not applicable.
(a)(2) Certification for each principal executive and principal financial
officer of the registrant as required by Rule 30a-2 under the Act (17 CFR
270.30a-2(a)) - Filed as an attachment to this filing.
(b) Certifications required by Rule 30a-2(b) under the Act (17 CFR
270.30a-2(b)), Rule 13a-14(b) or Rule 15d-14(b) under the Exchange Act (17
CFR 240.13a-14(b) or 240.15d-14(b)), and Section 1350 of Chapter 63 of
Title 18 of the United States Code (18 U.S.C. 1350) - Filed as an
attachment to this filing.
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.
OCM Mutual Fund
By: /s/ Gregory M. Orrell
----------------------
Gregory M. Orrell
President and Treasurer
Date: July 29, 2014
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ Gregory M. Orrell
---------------------
Gregory M. Orrell
President and Treasurer
Date: July 29, 2014