Skadden, Arps, Slate, Meagher & Flom LLP
333 West Wacker Drive
Chicago, Illinois 60606
January 19, 2007
Mr. Larry Greene
Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549
Re: Van Kampen Trust --
Post-Effective Amendment No. 57 to the
Registration Statement on Form N-1A
(the "Registration Statement")
(File Nos. 33-4410 and 811-4629)
Dear Mr. Greene:
Thank you for your telephonic comments regarding Post-Effective Amendment
No. 57 to the Registration Statement on Form N-1A filed with the Securities and
Exchange Commission (the "Commission") by Van Kampen Trust (the "Trust"), on
behalf of its series Van Kampen Core Plus Fixed Income Fund (the "Fund"), on
November 21, 2006 pursuant to Rule 485(a) of the General Rules and Regulations
of the Commission promulgated under the Securities Act of 1933, as amended, and
the Investment Company Act of 1940, as amended (the "General Rules and
Regulations"). On behalf of the Fund, we have summarized your comments to the
best of our understanding, below which we have provided our response to those
comments. We have not included comments which we resolved in the course of our
conference call with you. Where changes were necessary in response to your
comments, they are reflected in Post-Effective Amendment No. 58 to the Trust's
Registration Statement on Form N-1A, which will be filed pursuant to Rule 485(b)
of the General Rules and Regulations via EDGAR on or about January 19, 2007.
PROSPECTUS
COMMENT 1 IN THE SECOND PARAGRAPH ON THE OUTSIDE FRONT COVER OF THE
PROSPECTUS, THE REFERENCE TO "ANY STATE REGULATOR" IN THE RULE
481 STATEMENT MAY BE DELETED IF THE FUND SO DESIRES.
Response 1 The Fund acknowledges the comment and opts to include the
reference.
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COMMENT 2 PLEASE SUPPLEMENTALLY EXPLAIN WHETHER THE FUND'S INVESTMENT
OBJECTIVE OF "TOTAL RETURN" IS CONSISTENT WITH THE TERM "FIXED
INCOME" IN ITS NAME.
Response 2 The Fund believes that the investment objective of "total
return" is consistent with a fund that invests primarily in
fixed income securities, as the Fund does. "Total return" is
generally understood to account for two categories of return:
income and capital appreciation. The inclusion of "fixed
income" in the Fund's name indicates the type of securities in
which the Fund primarily invests. Fixed income securities have
the potential for income and capital appreciation. In the
Fund's portfolio management process, the Fund considers a
fixed income security's potential for both income and capital
appreciation in its buy, hold and sell decisions. Thus, while
some fixed income funds do indeed focus primarily or
exclusively on income, this Fund invests in fixed income
securities and considers the fixed income security's potential
for both income and capital appreciation. The Fund notes that
other fixed income mutual funds also have an investment
objective of total return.
COMMENT 3 IN THE SECTION ENTITLED "RISK/RETURN SUMMARY -- PRINCIPAL
INVESTMENT STRATEGIES," PLEASE EXPLAIN WHAT IS MEANT BY THE
TERM "CORE" IN THE FUND'S NAME.
Response 3 The Fund considers "core" to mean a wide range of U.S.
investment grade fixed income securities, including U.S.
Treasury, agency, corporate, mortgage and asset-backed
securities. The Fund respectfully submits that it believes
that its current disclosure in the section referenced
adequately describes this as the Fund's principal investment
strategy without specifically defining the term "core." Thus,
the Fund does not believe that additional disclosure is
necessary.
COMMENT 4 REVISE THE SECTION ENTITLED "FEES AND EXPENSES OF THE FUND,"
SO THAT THE FOOTNOTES APPEAR AFTER THE "EXAMPLE."
Response 4 The Fund respectfully submits that its disclosure under
"Fees and Expenses of the Fund," as currently presented,
complies with the requirements of Item 3 of Form N-1A.
Specifically, the Fund believes that moving the footnotes to
the Fee and Expense table to after the Example and
accompanying text would hinder shareholders' ability to
comprehend the information presented in the Fee and Expense
table.
COMMENT 5 IN THE "FEES AND EXPENSES OF THE FUND" TABLE, IF APPLICABLE,
DISCLOSE THAT THE INVESTMENT ADVISER HAS THE ABILITY TO
RECAPTURE OR RECOUP ANY FEES THAT IT WAIVED OR REIMBURSED.
Response 5 The suggested disclosure is not applicable to the Fund.
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COMMENT 6 IN FOOTNOTE 7 TO THE "FEES AND EXPENSES OF THE FUND" TABLE,
PLEASE REVISE THE DISCLOSURE TO BE MORE SPECIFIC REGARDING THE
LENGTH OF TIME THAT THE FUND'S INVESTMENT ADVISER WILL WAIVE
OR REIMBURSE CERTAIN FEES.
Response 6 The Fund has added the requested disclosure.
COMMENT 7 PLEASE SUPPLEMENTALLY EXPLAIN HOW THE FOLLOWING SENTENCE,
WHICH IS FOUND IN THE SEVENTH PARAGRAPH IN THE SECTION
ENTITLED, "INVESTMENT OBJECTIVE, PRINCIPAL INVESTMENT
STRATEGIES AND RISKS -- PRINCIPAL INVESTMENT STRATEGIES AND
RISKS" IS CONSISTENT WITH THE FUND'S INVESTMENT OBJECTIVE OF
"TOTAL RETURN":
"BY USING SUCH INSTRUMENTS, THE FUND SEEKS TO LIMIT ITS
EXPOSURE TO ADVERSE INTEREST RATE CHANGES, BUT THE FUND
ALSO REDUCES ITS POTENTIAL FOR CAPITAL APPRECIATION ON
FIXED INCOME SECURITIES IF INTEREST RATES DECLINE."
Response 7 As discussed above in response to Comment 2, total return is
generally understood to account for two categories of return:
income and capital appreciation. The referenced sentence is
explaining that in purchasing or selling options, futures
contracts, options on futures contracts, forward contracts,
swaps, structured products or other interest rate-related
transactions, the Fund would generally be seeking to limit its
exposure to adverse changes in interest rates, and in doing
so, the Fund is subject to the risk that achieving "capital
appreciation" -- a component of its investment objective -- is
more difficult. The Fund is pointing out the fact that
utilizing such investments subjects the Fund to risk that it
might be more difficult to achieve its investment objective.
COMMENT 8 IN THE SECTION ENTITLED, "INVESTMENT OBJECTIVE, PRINCIPAL
INVESTMENT STRATEGIES AND RISKS -- OTHER INVESTMENTS AND RISK
FACTORS" PLEASE CLARIFY WHETHER THE FUND'S INVESTMENTS IN
REPURCHASE AGREEMENTS AND REVERSE REPURCHASE AGREEMENTS ARE A
PRINCIPAL INVESTMENT STRATEGY OF THE FUND.
Response 8 The Fund respectfully submits that the sub-heading entitled
"Other Investments and Risk Factors" within the main heading
entitled "Investment Objective, Principal Investment
Strategies and Risks" makes clear that investments described
thereunder are not principal investment strategies. Thus, the
Fund does not believe that additional disclosure is necessary.
COMMENT 9 IN THE FIFTH PARAGRAPH OF THE SECTION ENTITLED "INVESTMENT
OBJECTIVE, PRINCIPAL INVESTMENT STRATEGIES AND RISKS -- OTHER
INVESTMENTS AND RISK FACTORS," IF THE SHORT SALES IN WHICH THE
FUND MAY ENGAGE ARE "NAKED SHORT" SALES, PLEASE CLARIFY THAT
THE RISKS OF LOSS IN SUCH TYPES OF INVESTMENTS ARE UNLIMITED.
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Response 9 The Fund has added the requested disclosure.
COMMENT 10 UNDER "INVESTMENT ADVISORY SERVICES--PORTFOLIO MANAGEMENT,"
EXPLAIN SUPPLEMENTALLY WHETHER THE FOLLOWING SENTENCE IS
CONSISTENT WITH ITEM 5(a)(2) AND ITEM 15(a) OF FORM N-1A: "THE
COMPOSITION OF THE TEAM MAY CHANGE WITHOUT NOTICE FROM TIME TO
TIME."
Response 10 Item 5(a)(2) requires disclosure of the persons "primarily
responsible for the day-to-day management of the Fund's
portfolio ('Portfolio Manager')," and Item 15(a) requires
certain disclosure regarding such persons' management of other
accounts. The Fund is managed by a team of investment
professionals. The team may be comprised both of persons
"primarily responsible for the day-to-day management of the
Fund's portfolio" (any such persons are disclosed under Item
5(a)(2) and Item 15(a)) and persons who are not. The
referenced disclosure states that the composition of each team
may change without notice from time to time. We note
supplementally that, notwithstanding the Fund's disclosure
that team members may change without notice, to the extent
that a team member with primary responsibility for the
day-to-day management of the Fund's portfolio changes, the
Fund intends to supplement its Prospectus and its Statement of
Additional Information with the information required by Item
5(a)(2) and Item 15(a) for such team member.
COMMENT 11 IN THE SECTION ENTITLED "INVESTMENT ADVISORY SERVICES,"
PLEASE REVISE THE SUB-SECTION ENTITLED "COMPARATIVE
PERFORMANCE" SO THAT IT IS CLEAR THAT THE FUND'S HISTORICAL
PERFORMANCE IS NOT INCLUDED THEREIN.
Response 11 The Fund has revised the title of the sub-section as
requested.
COMMENT 12 PLEASE CONFIRM SUPPLEMENTALLY WHETHER THE ACCOUNTS THAT
COMPRISE THE COMPOSITE IN THE SECTION ENTITLED "INVESTMENT
ADVISORY SERVICES -- COMPARATIVE PERFORMANCE" INCLUDE ALL
ACCOUNTS MANAGED BY THE FUND'S PORTFOLIO MANAGEMENT TEAM THAT
HAVE SUBSTANTIALLY SIMILAR INVESTMENT OBJECTIVES, STRATEGIES
AND RISKS AS THE FUND.
Response 12 The Composite includes all such accounts. The Fund notes
that the following disclosure is currently in the second
sentence of the fourth paragraph in the section referenced:
"[t]he Composite includes all accounts managed by the
Fund's portfolio management team that have substantially
similar investment objectives, policies, strategies and
risks as the Fund."
COMMENT 13 IN THE SECTION ENTITLED "INVESTMENT ADVISORY SERVICES --
COMPARATIVE PERFORMANCE," PLEASE CLARIFY THAT THE PERFORMANCE
FIGURES FOR THE COMPOSITE
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ARE BASED ON THE ACTUAL INVESTMENT PERFORMANCE OF THE
COMPOSITE AFTER DEDUCTION OF ACTUAL FEES AND EXPENSES.
Response 13 The Fund has clarified the disclosure as requested.
COMMENT 14 PLEASE SUPPLEMENTALLY EXPLAIN WHAT IS MEANT BY "PORTFOLIO
MANAGEMENT TEAM" WITHIN THE STATEMENT "[T]HE SAME PORTFOLIO
MANAGEMENT TEAM IS RESPONSIBLE FOR MANAGING THE COMPOSITE AND
THE FUND" IN THE FIRST PARAGRAPH OF THE SECTION ENTITLED
"INVESTMENT ADVISORY SERVICES -- COMPARATIVE PERFORMANCE."
Response 14 "Portfolio management team" refers to the persons jointly and
primarily responsible for the day-to-day management of each of
the Fund's and the Composite's portfolio which are listed in
the preceding paragraph labeled "Portfolio management team":
W. David Armstrong and Roberto Sella. The Fund has revised the
sentence to the following: "[T]he same portfolio managers, see
above, are responsible for managing the Composite and the
Fund."
COMMENT 15 IN THE SECTION ENTITLED "PURCHASE OF SHARES -- PRICING FUND
SHARES," PLEASE PROVIDE THE REQUISITE FAIR VALUE PRICING
DISCLOSURE.
Response 15 The Fund notes that the requested disclosure is currently
in the fifth paragraph of the section referenced. Thus, the
Fund does not believe that additional disclosure is necessary.
COMMENT 16 IN THE ELEVENTH PARAGRAPH IN THE SECTION ENTITLED "PURCHASE
OF SHARES -- HOW TO BUY SHARES," PLEASE PROVIDE THE REQUISITE
DISCLOSURE REGARDING WHETHER THE FUND HAS A MONEY LAUNDERING
AGENT.
Response 16 The Fund has added the requested disclosure.
STATEMENT OF ADDITIONAL INFORMATION
COMMENT 17 IN THE SECTION ENTITLED "INVESTMENT OBJECTIVE, INVESTMENT
STRATEGIES AND RISKS -- VARIABLE AND FLOATING RATE SECURITIES,
INVERSE FLOATING RATE SECURITIES," IF THE FUND INTENDS TO
INVEST IN INVERSE FLOATING RATE OBLIGATIONS THAT ARE TO BE
ACCOUNTED FOR AS SECURED BORROWINGS, PLEASE ADD RELEVANT
DISCLOSURE.
Response 17 The Fund has added the requested disclosure.
COMMENT 18 IN THE SECTION ENTITLED "INVESTMENT RESTRICTIONS," INVESTMENT
RESTRICTION 2 PROVIDES THAT THE FUND SHALL NOT "ISSUE SENIOR
SECURITIES NOR BORROW MONEY, EXCEPT ... TO THE EXTENT
PERMITTED BY ... THE 1940 ACT" [EMPHASIS ADDED]. PLEASE
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ADD DISCLOSURE DESCRIBING THE PERMISSIBILITY UNDER THE CURRENT
APPLICABLE REGULATIONS OF THE EMPHASIZED PORTION.
Response 18 The Fund notes that the following disclosure is currently
in the third paragraph of the section of the Prospectus
entitled "Investment Objective, Principal Investment
Strategies and Risks -- Other Investments and Risk Factors":
"The Fund may borrow money to the extent permitted under
the 1940 Act. This means that, in general, the Fund may
borrow money from banks for any purpose on a secured
basis in an amount up to 33 1/3% of the Fund's total
assets."
Thus, the Fund does not believe that additional disclosure is
necessary.
COMMENT 19 IN THE SECTION ENTITLED "INVESTMENT RESTRICTIONS," INVESTMENT
RESTRICTION 2 PROVIDES THAT THE FUND SHALL NOT "ISSUE SENIOR
SECURITIES NOR BORROW MONEY, EXCEPT ... TO THE EXTENT
PERMITTED BY ... THE 1940 ACT". PLEASE ADD DISCLOSURE
REGARDING WHETHER THE FUND PRESENTLY INTENDS TO ENGAGE IN
INVESTMENT LEVERAGE, OR IN THE ALTERNATIVE, INCLUDE A POLICY
THAT THE FUND WILL NOT PURCHASE ADDITIONAL PORTFOLIO
SECURITIES AT ANY TIME THAT BORROWINGS EXCEED 5% OF THE FUND'S
TOTAL ASSETS.
Response 19 The Fund currently has an operating policy, which may be
changed by the Fund's Board of Trustees, not to borrow money
except for temporary purposes and then in an amount not in
excess of 5% of the value of the total assets of the Fund at
the time the borrowing is made.
COMMENT 20 IN THE SECTION ENTITLED "INVESTMENT RESTRICTIONS," INVESTMENT
RESTRICTION 4 PROVIDES THAT THE FUND MAY "NOT INVEST IN ANY
SECURITY IF, AS A RESULT, 25% OR MORE OF THE VALUE OF THE
FUND'S TOTAL ASSETS....ARE IN THE SECURITIES OF ISSUERS IN ANY
PARTICULAR INDUSTRY, EXCEPT ... WHEN THE FUND HAS TAKEN A
TEMPORARY DEFENSIVE POSITION". SINCE THIS EXCEPTION SUGGESTS
THAT THE FUND COULD CONCENTRATE ITS INVESTMENTS IN ANY
INDUSTRY OR GROUP OF INDUSTRIES WHEN IT HAS TAKEN A TEMPORARY
DEFENSIVE POSITION, IT APPEARS THAT THE FUND HAS RESERVED THE
FREEDOM OF ACTION TO CONCENTRATE ITS INVESTMENTS WHEN IT HAS
TAKEN A TEMPORARY DEFENSIVE POSITION. THE STAFF HAS
HISTORICALLY TAKEN THE POSITION THAT FUNDS MAY NOT RESERVE THE
RIGHT TO CONCENTRATE IN AN INDUSTRY OR GROUP OF INDUSTRIES.
ACCORDINGLY, PLEASE EXPLAIN TO US HOW THIS POLICY IS
CONSISTENT WITH SECTION 8(b)(1)(E) OF THE 1940 ACT.
Response 20 The Fund has deleted the referenced exception from Investment
Restriction 4.
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COMMENT 21 IN THE SECTION ENTITLED "INVESTMENT RESTRICTIONS," INVESTMENT
RESTRICTION 7 PROVIDES THAT THE FUND MAY "NOT ... MAKE LOANS
OF MONEY OR PROPERTY TO ANY PERSON, EXCEPT... THROUGH THE LOAN
OF PORTFOLIO SECURITIES...". PLEASE ADD DISCLOSURE INDICATING
THE AMOUNT OF PORTFOLIO SECURITIES LENDING THAT THE FUND
INTENDS TO DO.
Response 21 The Fund does not have a current intention to lend any of
its portfolio securities, thus the Fund does not believe that
any additional disclosure regarding such practice is
necessary.
COMMENT 22 IN THE "INVESTMENT OBJECTIVE, INVESTMENT STRATEGIES AND
RISKS" SECTION, PLEASE DISCLOSE THE FUND'S POLICY ON INVESTING
IN ILLIQUID SECURITIES.
Response 22 The Fund notes that the requested disclosure is currently
in two places: (i) the sixth paragraph of the section of the
Prospectus entitled "Investment Objective, Principal
Investment Strategies and Risks -- Other Investments and Risk
Factors" and (ii) the section of the Statement of Additional
Information entitled "Investment Objective, Investment
Strategies and Risks -- Illiquid Securities." Thus, the Fund
does not believe that additional disclosure is necessary.
* * *
Pursuant to Rule 485(b)(4), the undersigned hereby represents that this
Amendment to the Registration Statement does not contain any disclosures that
would render it ineligible to become effective under paragraph (b) of Rule 485
of the General Rules and Regulations.
In connection with the effectiveness of the Registration Statement, the
Fund acknowledges that the disclosure included in the Registration Statement is
the responsibility of the Fund. The Fund further acknowledges that the action of
the Commission or the staff acting pursuant to delegated authority in reviewing
the Registration Statement does not relieve the Fund from its full
responsibility for the adequacy and accuracy of the disclosures in the
Registration Statement; and that the Fund will not assert this action as a
defense in any proceeding initiated by the Commission or any person under the
federal securities laws of the United States.
Should you have any questions concerning our responses to your comments,
please direct them to Alice Gerstel at (212) 762-7546 or the undersigned at
(312) 407-0863.
Sincerely,
/s/ Charles B. Taylor
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