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 811-04801
---------------------------------------------
SunAmerica Equity Funds
--------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
Harborside Financial Center, 3200 Plaza 5 Jersey City, NJ 07311
--------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
John T. Genoy
Senior Vice President
SunAmerica Asset Management Corp.
Harborside Financial Center,
3200 Plaza 5
Jersey City, NJ 07311
--------------------------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: (201) 324-6414
-----------------------------
Date of fiscal year end: September 30
--------------------------
Date of reporting period: March 31, 2013
-------------------------
Item 1. Reports to Stockholders
[PHOTO]
SEMI-ANNUAL REPORT 2013
SUNAMERICA
Equity Funds
MARCH 31, 2013 SEMI-ANNUAL REPORT
SUNAMERICA EQUITY FUNDS
SUNAMERICA INTERNATIONAL DIVIDEND STRATEGY FUND (SIEAX)
SUNAMERICA VALUE FUND (SSVAX)
SUNAMERICA JAPAN FUND (SAESX)
TABLE OF CONTENTS
SHAREHOLDER LETTER.......................................... 2
EXPENSE EXAMPLE............................................. 4
STATEMENT OF ASSETS AND LIABILITIES......................... 6
STATEMENT OF OPERATIONS..................................... 8
STATEMENT OF CHANGES IN NET ASSETS.......................... 9
FINANCIAL HIGHLIGHTS........................................ 10
PORTFOLIO OF INVESTMENTS.................................... 13
NOTES TO FINANCIAL STATEMENTS............................... 22
SHAREHOLDER LETTER -- (UNAUDITED)
Dear Shareholders,
We are pleased to present this semi-annual update for the SunAmerica Equity
Funds for the six months ended March 31, 2013. It was a period wherein U.S. and
international equity performance was generally strong overall; however,
volatility also presented itself.
As the semi-annual period began in October 2012, the U.S. equity market
experienced a pullback. Despite strong housing data and an encouraging drop in
the unemployment rate, investors focused on disappointing corporate revenue
results and worries that the divisive political atmosphere in Washington, D.C.
might prevent Congress from reaching a deal on the then-looming fiscal cliff.
Also pressuring the U.S. equity market was the worst storm in decades battering
the East Coast. The U.S. equity market subsequently regained momentum in
November 2012, as election day largely preserved the status quo in the White
House and Congress, and economic data showed signs of improvement. In December
2012, the Federal Reserve (the "Fed") provided a boost to equities after
announcing further monetary accommodation and shifts in its policy regarding
rate guidance. The Fed said that short-term interest rates would remain near
zero as long as unemployment remains above 6.5% and inflation stays in check.
International equities rallied during the fourth quarter of 2012 despite a host
of weak economic data points. The Eurozone fell into recession for the second
time in four years, and the unemployment rate there climbed to 11.7%, a new
record. However, optimism generated from the European Central Bank's ("ECB")
bond-buying program and the resolution of a deal on reducing Greece's debt
encouraged investors. The export-driven economies of the Pacific Basin surged
as well, led by Japan. Housing starts in Japan rebounded sharply on a
year-over-year basis, partly owing to earthquake-related rebuilding efforts.
Investors also cheered the election of Prime Minister Shinzo Abe, as he vowed
to pursue aggressive monetary easing to end deflation and get the Japanese
economy growing again.
U.S. equities then finished the first quarter of 2013 at a new record high. The
rally began on the first trading day of the year after a last-minute compromise
by the U.S. Congress averted the fiscal cliff. Optimism was furthered by better
than expected corporate earnings, a robust housing market and a steadily
improving employment picture. Investors also took solace from Fed Chair
Bernanke's defense of the central bank's quantitative easing measures,
lessening fears that the asset purchasing program would end earlier than
expected. European equities also rallied during the first quarter of 2013,
despite a banking crisis in Cyprus, political paralysis in Italy and a number
of tepid economic data points, including five consecutive quarters of economic
contraction and an unemployment rate that rose to 11.9%, the highest reading on
record. However, the credible backstop provided by the ECB's Outright Monetary
Transactions program eased fears. Japanese stocks once again led the Pacific
Basin region's rally, as investors' honeymoon with pro-business Prime Minister
Abe continued. In his first major action since taking office, Abe announced a
$116 billion spending program aimed at reversing deflation and fueling economic
growth. Market participants also applauded the nomination of Asian Development
Bank President Haruhiko Kuroda as Japan's new central bank chief, a move that
pointed to continued monetary stimulus. On the economic front, it was reported
that Japan's annualized Gross Domestic Product ("GDP") growth had resumed in
the fourth quarter of 2012, and consumer confidence rose to its highest level
since mid-2007. The yen's more than 20% decline against the U.S. dollar during
the semi-annual period improved the outlook for Japanese exporters, but did
reduce equity returns expressed in U.S. dollars.
Against this backdrop, U.S. equities, as measured by the S&P 500(R) Index*,
returned 10.19% for the six months ended March 31, 2013. International
equities, as measured by the MSCI All Country (AC) World ex-U.S. Index*, only
modestly lagged the U.S. equity market, returning 9.20% for the same six-month
period; while Japanese equities, as measured by the MSCI Japan Index*, returned
18.08%.
Amid these conditions, each of the portfolios in the SunAmerica Equity Funds
generated positive gains during the semi-annual period. On the following pages,
you will find detailed financials statements and portfolio information for each
of the SunAmerica Equity Funds.
2
We thank you for being a part of the SunAmerica Equity Funds. We value your
ongoing confidence in us and look forward to serving your investment needs in
the future. As always, if you have any questions regarding your investments,
please contact your financial advisor or get in touch with us directly at
800-858-8850 or www.safunds.com.
Sincerely,
THE SUNAMERICA EQUITY FUNDS INVESTMENT PROFESSIONALS
Steve Neimeth Jun Oh Brendan Voege Timothy Campion
Sarah Kallok Ben Barrett Mike Beaulieu Kara Murphy
Jay Merchant Chris Kagaoan Jennifer Coombs Jane Bayar
Jayme Liesiewski Kei Yamamoto
--------
Past performance is no guarantee of future results.
*The S&P 500 INDEX is Standard & Poor's 500 Composite Stock Price Index, a
widely recognized, unmanaged index of U.S. common stock prices. The MORGAN
STANLEY CAPITAL INTERNATIONAL (MSCI) ALL COUNTRY (AC) WORLD EX-U.S. INDEX is a
free float-adjusted market capitalization-weighted index designed to measure
the equity market performance of 47 global developed and emerging markets,
excluding the U.S. The MSCI JAPAN INDEX is a free-float adjusted market
capitalization weighted index that is designed to track the equity market
performance of Japanese securities listed on Tokyo Stock Exchange, Osaka Stock
Exchange, JASDAQ and Nagoya Stock Exchange. Indices are not managed and an
investor cannot invest directly in an index.
3
SUNAMERICA EQUITY FUNDS
EXPENSE EXAMPLE -- MARCH 31, 2013 -- (UNAUDITED)
DISCLOSURE OF PORTFOLIO EXPENSES IN SHAREHOLDER REPORTS
As a shareholder of a Fund (each, a "Fund" and collectively, the "Funds") in
the SunAmerica Equity Funds (the "Trust"), you may incur two types of costs:
(1) transaction costs, including sales charges (loads) on purchase payments,
contingent deferred sales charges, redemption fees* (applicable to Class A
shares of SunAmerica International Dividend Strategy Fund and SunAmerica Japan
Fund only) and (2) ongoing costs, including management fees; distribution and
service fees; and other Fund expenses. The Example set forth below is 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. The Example is based on an investment of $1,000 invested at
October 1, 2012 and held until March 31, 2013.
ACTUAL EXPENSES
The "Actual" section of the table provides information about actual account
values and actual expenses. You may use the information in these columns,
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 column under the heading entitled "Expenses Paid During the Six
Months Ended March 31, 2013" to estimate the expenses you paid on your account
during this period. For shareholder accounts in classes other than Class I and
Class Z, the "Expenses Paid During the Six Months Ended March 31, 2013" column
does not include small account fees that may be charged if your account balance
is below $500 ($250 for retirement plan accounts). In addition, the "Expenses
Paid During the Six Months Ended March 31, 2013" column does not include
administrative fees that may apply to qualified retirement plan accounts. See
the Funds' prospectus, your retirement plan document and/or materials from your
financial adviser, for a full description of these fees. Had these fees been
included, the "Expenses Paid During the Six Months Ended March 31, 2013" column
would have been higher and the "Ending Account Value" would have been lower.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The "Hypothetical" section of the table 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 the ongoing costs of
investing in the Funds and other funds. To do so, compare this 5% hypothetical
example with the 5% hypothetical examples that appear in the shareholder
reports of other funds. For shareholder accounts in classes other than Class I
and Class Z the "Expenses Paid During the Six Months Ended March 31, 2013"
column does not include small account fees that may be charged if your account
balance is below $500 ($250 for retirement plan accounts). In addition, the
"Expenses Paid During the Six Months Ended March 31, 2013" column does not
include administrative fees that may apply to qualified retirement plan
accounts. See the Funds' prospectus, your retirement plan document and/or
materials from your financial adviser, for a full description of these fees.
Had these fees been included, the "Expenses Paid During the Six Months Ended
March 31, 2013" column would have been higher and the "Ending Account Value"
would have been lower.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transaction costs, including sales
charges on purchase payments, contingent deferred sales charges, redemption
fees* (applicable to Class A shares of SunAmerica International Dividend
Strategy Fund and SunAmerica Japan Fund only); small account fees and
administrative fees, if applicable to your account. Please refer to the Fund's
prospectus, your retirement plan document and/or materials from your financial
adviser, for more information. Therefore, the "Hypothetical" example 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 transaction costs
and other fees were included, your costs would have been higher.
--------
*See Note 13
4
SUNAMERICA EQUITY FUNDS
EXPENSE EXAMPLE -- MARCH 31, 2013 -- (UNAUDITED) (CONTINUED)
ACTUAL HYPOTHETICAL
----------------------------------------- -----------------------------------------
ENDING ACCOUNT
ENDING ACCOUNT EXPENSE PAID VALUE USING A EXPENSE PAID
VALUE USING DURING THE HYPOTHETICAL DURING THE
BEGINNING ACTUAL SIX MONTHS BEGINNING 5% ASSUMED SIX MONTHS
ACCOUNT VALUE RETURN AT ENDED ACCOUNT VALUE RETURN AT ENDED
AT OCTOBER 1, MARCH 31, MARCH 31, AT OCTOBER 1, MARCH 31, MARCH 31,
FUND 2012 2013 2013 2012 2013 2013
---- ------------- -------------- ------------ ------------- -------------- ------------
INTERNATIONAL DIVIDEND STRATEGY FUND#
Class A............................. $1,000.00 $1,029.75 $ 9.61 $1,000.00 $1,015.46 $ 9.55
Class B............................. $1,000.00 $1,026.73 $12.89 $1,000.00 $1,012.22 $12.79
Class C............................. $1,000.00 $1,026.75 $12.89 $1,000.00 $1,012.22 $12.79
Class I............................. $1,000.00 $1,029.85 $ 9.11 $1,000.00 $1,015.96 $ 9.05
VALUE FUND
Class A............................. $1,000.00 $1,109.21 $ 8.36 $1,000.00 $1,017.00 $ 8.00
Class B#............................ $1,000.00 $1,105.43 $11.97 $1,000.00 $1,013.56 $11.45
Class C#............................ $1,000.00 $1,104.93 $11.97 $1,000.00 $1,013.56 $11.45
Class Z............................. $1,000.00 $1,112.78 $ 4.95 $1,000.00 $1,020.24 $ 4.73
JAPAN FUND#
Class A............................. $1,000.00 $1,140.25 $10.14 $1,000.00 $1,015.46 $ 9.55
Class B............................. $1,000.00 $1,134.74 $13.57 $1,000.00 $1,012.22 $12.79
Class C............................. $1,000.00 $1,136.57 $13.58 $1,000.00 $1,012.22 $12.79
EXPENSE
RATIO
AS OF
MARCH 31,
FUND 2013
---- ---------
INTERNATIONAL DIVIDEND STRATEGY FUND#
Class A............................. 1.90%
Class B............................. 2.55%
Class C............................. 2.55%
Class I............................. 1.80%
VALUE FUND
Class A............................. 1.59%
Class B#............................ 2.28%
Class C#............................ 2.28%
Class Z............................. 0.94%
JAPAN FUND#
Class A............................. 1.90%
Class B............................. 2.55%
Class C............................. 2.55%
--------
* Expenses are equal to the Fund's annualized expense ratio multiplied by the
average account value over the period, multiplied by 182 days divided by 365
days. These ratios do not reflect transaction costs, including sales charges
on purchase payments, contingent deferred sales charges, redemption fees (1)
(International Dividend Strategy Fund and Japan Fund only), small account
fees and administrative fees, if applicable to your account. Please refer to
your Prospectus, your retirement plan documents and/or materials from your
financial advisor for more information.
# During the stated period, the investment advisor either waived a portion of
or all of the fees and assumed a portion of or all expenses for the Funds or
through recoupment provisions, recovered a portion of or all fees and
expenses waived or reimbursed in the previous two fiscal years. As a result,
if these fees and expenses had not been waived or assumed, the
"Actual/Hypothetical Ending Account Value" would have been lower and the
"Actual/Hypothetical Expenses Paid During the Six Months Ended March 31,
2013" and the "Expense Ratios" would have been higher. If these fees and
expenses had not been recouped, the "Actual/Hypothetical Ending Account
Value" would have been higher and the "Actual/Hypothetical Expenses Paid
During the Six Months Ended March 31, 2013" and "Expense Ratios" would have
been lower.
(1)See Note 13
5
SUNAMERICA EQUITY FUNDS
STATEMENT OF ASSETS AND LIABILITIES -- MARCH 31, 2013 -- (UNAUDITED)
INTERNATIONAL
DIVIDEND
STRATEGY FUND VALUE FUND JAPAN FUND
------------- ------------ -----------
ASSETS:
Investments at value (unaffiliated)*............................................ $ 95,187,478 $111,544,400 $20,184,108
Repurchase agreements (cost approximates value)................................. 2,066,000 6,875,000 --
------------- ------------ -----------
Total investments.............................................................. 97,253,478 118,419,400 20,184,108
------------- ------------ -----------
Cash............................................................................ 198 28,412 118,828
Foreign cash*................................................................... 263,718 -- 169,415
Receivable for:
Fund shares sold............................................................... 760,647 1,169 172,629
Dividends and interest......................................................... 622,910 135,158 174,940
Investments sold............................................................... -- 1,441,492 298,618
Prepaid expenses and other assets............................................... 340 8,933 137
Due from investment adviser for expense reimbursements/fee waivers.............. 24,739 1,659 12,541
------------- ------------ -----------
Total assets.................................................................... 98,926,030 120,036,223 21,131,216
------------- ------------ -----------
LIABILITIES:
Payable for:
Fund shares redeemed........................................................... 56,391 91,161 18,889
Investments purchased.......................................................... -- 5,526,223 94,364
Investment advisory and management fees........................................ 84,312 72,596 20,144
Distribution and service maintenance fees...................................... 42,858 44,967 6,515
Transfer agent fees and expenses............................................... 27,927 41,459 4,983
Trustees' fees and expenses.................................................... 2,476 3,708 951
Other accrued expenses......................................................... 132,847 87,921 56,905
------------- ------------ -----------
Total liabilities............................................................... 346,811 5,868,035 202,751
------------- ------------ -----------
Net Assets...................................................................... $ 98,579,219 $114,168,188 $20,928,465
============= ============ ===========
NET ASSETS REPRESENTED BY:
Shares of beneficial interest, $0.01 par value.................................. $ 91,247 $ 79,395 $ 29,389
Paid-in capital................................................................. 200,086,811 177,034,945 19,651,795
------------- ------------ -----------
200,178,058 177,114,340 19,681,184
Accumulated undistributed net investment income (loss).......................... (534,231) 219,069 (42,173)
Accumulated undistributed net realized gain (loss) on investments, futures
contracts, options contracts, securities sold short, foreign exchange
transactions................................................................... (101,393,334) (74,883,170) (214,258)
Unrealized appreciation (depreciation) on investments........................... 341,212 11,717,949 1,504,395
Unrealized foreign exchange gain (loss) on other assets and liabilities......... (12,486) -- (683)
------------- ------------ -----------
Net Assets...................................................................... $ 98,579,219 $114,168,188 $20,928,465
============= ============ ===========
*Cost
Investments (unaffiliated)..................................................... $ 94,846,266 $ 99,826,451 $18,679,713
============= ============ ===========
Foreign cash................................................................... $ 265,661 $ -- $ 169,880
============= ============ ===========
See Notes to Financial Statements
6
SUNAMERICA EQUITY FUNDS
STATEMENT OF ASSETS AND LIABILITIES -- MARCH 31, 2013 -- (UNAUDITED)
(CONTINUED)
INTERNATIONAL
DIVIDEND
STRATEGY FUND VALUE FUND JAPAN FUND
------------- ----------- -----------
CLASS A (UNLIMITED SHARES AUTHORIZED):
Net assets...................................................................... $72,834,138 $93,935,525 $20,107,148
Shares of beneficial interest issued and outstanding............................ 6,593,984 6,452,574 2,820,368
Net asset value and redemption price per share.................................. $ 11.05 $ 14.56 $ 7.13
Maximum sales charge (5.75% of offering price).................................. $ 0.67 $ 0.89 $ 0.43
----------- ----------- -----------
Maximum offering price to public................................................ $ 11.72 $ 15.45 $ 7.56
=========== =========== ===========
CLASS B (UNLIMITED SHARES AUTHORIZED):
Net assets...................................................................... $ 5,222,108 $ 4,963,831 $ 201,277
Shares of beneficial interest issued and outstanding............................ 514,936 364,031 29,038
Net asset value, offering and redemption price per share (excluding any
applicable contingent deferred sales charge)................................... $ 10.14 $ 13.64 $ 6.93
=========== =========== ===========
CLASS C (UNLIMITED SHARES AUTHORIZED):
Net assets...................................................................... $19,312,874 $15,216,680 $ 620,040
Shares of beneficial interest issued and outstanding............................ 1,907,072 1,119,507 89,510
Net asset value, offering and redemption price per share (excluding any
applicable contingent deferred sales charge)................................... $ 10.13 $ 13.59 $ 6.93
=========== =========== ===========
CLASS I (UNLIMITED SHARES AUTHORIZED):
Net assets...................................................................... $ 1,210,099 $ -- $ --
Shares of beneficial interest issued and outstanding............................ 108,678 -- --
Net asset value, offering and redemption price per share........................ $ 11.13 $ -- $ --
=========== =========== ===========
CLASS Z (UNLIMITED SHARES AUTHORIZED):
Net assets...................................................................... $ -- $ 52,152 $ --
Shares of beneficial interest issued and outstanding............................ -- 3,407 --
Net asset value, offering and redemption price per share........................ $ -- $ 15.31 $ --
=========== =========== ===========
See Notes to Financial Statements
7
SUNAMERICA EQUITY FUNDS
STATEMENT OF OPERATIONS -- MARCH 31, 2013 -- (UNAUDITED)
INTERNATIONAL
DIVIDEND
STRATEGY FUND VALUE FUND JAPAN FUND
------------- ----------- ----------
INVESTMENT INCOME:
Dividends (unaffiliated)........................................................ $1,255,293 $ 1,389,019 $ 190,268
Interest (unaffiliated)......................................................... 8,368 325 --
---------- ----------- ----------
Total investment income*...................................................... 1,263,661 1,389,344 190,268
---------- ----------- ----------
EXPENSES:
Investment advisory and management fees......................................... 403,400 410,965 116,039
Distribution and service maintenance fees:
Class A....................................................................... 103,449 156,874 34,221
Class B....................................................................... 24,745 25,138 951
Class C....................................................................... 76,735 74,088 2,178
Service Fees Class I............................................................ 1,588 -- --
Transfer agent fees and expenses:
Class A....................................................................... 76,768 113,996 22,547
Class B....................................................................... 7,567 8,910 667
Class C....................................................................... 19,821 18,849 912
Class I....................................................................... 1,477 -- --
Registration fees:
Class A....................................................................... 21,070 20,074 6,185
Class B....................................................................... 9,988 7,186 3,297
Class C....................................................................... 9,430 7,681 3,363
Class I....................................................................... -- -- --
Custodian and accounting fees................................................... 79,729 25,838 24,080
Reports to shareholders......................................................... 29,868 29,774 2,218
Audit and tax fees.............................................................. 25,135 23,449 26,944
Legal fees...................................................................... 24,678 7,611 7,300
Directors' fees and expenses.................................................... 2,934 3,082 1,096
Interest expense................................................................ -- -- 134
Other expenses.................................................................. 12,552 12,273 10,985
---------- ----------- ----------
Total expenses before fee waivers, expense reimbursements, expense
recoupments, custody credits and fees paid indirectly........................ 930,934 945,788 263,117
Net (Fees waived and expenses reimbursed)/recouped by investment adviser
(Note 3)..................................................................... (99,147) (8,529) (69,343)
Custody credits earned on cash balances....................................... -- (3) --
Fees paid indirectly (Note 4)................................................. -- (9,625) --
---------- ----------- ----------
Net expenses.................................................................. 831,787 927,631 193,774
---------- ----------- ----------
Net investment income (loss)..................................................... 431,874 461,713 (3,506)
---------- ----------- ----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCIES:
Net realized gain (loss) on investments (unaffiliated)........................... 146,900 7,112,736 (24,693)
Net realized foreign exchange gain (loss) on other assets and liabilities........ 9,037 -- (11,926)
---------- ----------- ----------
Net realized gain (loss) on investments and foreign currencies................... 155,937 7,112,736 (36,619)
---------- ----------- ----------
Change in unrealized appreciation (depreciation) on investments (unaffiliated)... 282,054 3,742,508 2,645,749
Change in unrealized foreign exchange gain (loss) on other assets and
liabilities..................................................................... (11,100) -- (2,691)
---------- ----------- ----------
Net unrealized gain (loss) on investments and foreign currencies................. 270,954 3,742,508 2,643,058
---------- ----------- ----------
Net realized and unrealized gain (loss) on investments and foreign currencies.... 426,891 10,855,244 2,606,439
---------- ----------- ----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS.................. $ 858,765 $11,316,957 $2,602,933
========== =========== ==========
--------
* Net of foreign withholding taxes on interest and dividends of.................. $ 186,779 $ 2,357 $ 14,625
========== =========== ==========
See Notes to Financial Statements
8
SUNAMERICA EQUITY FUNDS
STATEMENT OF CHANGES IN NET ASSETS -- MARCH 31, 2013
INTERNATIONAL DIVIDEND
STRATEGY FUND VALUE FUND JAPAN FUND
------------------------- -------------------------- -------------------------
FOR THE SIX FOR THE SIX FOR THE SIX
MONTHS ENDED FOR THE YEAR MONTHS ENDED FOR THE YEAR MONTHS ENDED FOR THE YEAR
MARCH 31, ENDED MARCH 31, ENDED MARCH 31, ENDED
2013 SEPTEMBER 30, 2013 SEPTEMBER 30, 2013 SEPTEMBER 30,
(UNAUDITED) 2012 (UNAUDITED) 2012 (UNAUDITED) 2012
------------ ------------- ------------ ------------- ------------ -------------
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS:
Net investment income (loss)...... $ 431,874 $ 1,309,087 $ 461,713 $ 754,515 $ (3,506) $ 126,503
Net realized gain (loss) on
investments and foreign
currencies...................... 155,937 (6,737,866) 7,112,736 3,765,375 (36,619) 497,689
Net unrealized gain (loss) on
investments and foreign
currencies...................... 270,954 11,471,568 3,742,508 22,892,776 2,643,058 562,077
----------- ----------- ------------ ------------ ----------- ------------
Net increase (decrease) in net
assets resulting from operations.. 858,765 6,042,789 11,316,957 27,412,666 2,602,933 1,186,269
----------- ----------- ------------ ------------ ----------- ------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (Class A)... (859,382) (1,234,410) (743,703) (898,865) (470,762) (47,904)
Net investment income (Class B)... (78,446) (64,930) (4,399) (27,012) (3,078) --
Net investment income (Class C)... (228,273) (173,790) (36,119) (88,986) (6,981) --
Net investment income (Class I)... (21,274) (33,449) -- -- -- --
Net investment income (Class Z)... -- -- (1,988) (3,390) -- --
Net realized gain on securities
(Class A)....................... -- -- -- -- -- (4,495,773)
Net realized gain on securities
(Class B)....................... -- -- -- -- -- (55,170)
Net realized gain on securities
(Class C)....................... -- -- -- -- -- (160,446)
Net realized gain on securities
(Class I)....................... -- -- -- -- -- --
Net realized gain on securities
(Class Z)....................... -- -- -- -- -- --
----------- ----------- ------------ ------------ ----------- ------------
Total distributions to shareholders (1,187,375) (1,506,579) (786,209) (1,018,253) (480,821) (4,759,293)
----------- ----------- ------------ ------------ ----------- ------------
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM CAPITAL
SHARE TRANSACTIONS (NOTE 7)....... 29,166,766 (4,916,682) (6,595,972) (32,552,724) (2,543,367) (7,572,688)
----------- ----------- ------------ ------------ ----------- ------------
TOTAL INCREASE (DECREASE) IN NET
ASSETS............................ 28,838,156 (380,472) 3,934,776 (6,158,311) (421,255) (11,145,712)
NET ASSETS:
Beginning of period................ 69,741,063 70,121,535 110,233,412 116,391,723 21,349,720 32,495,432
----------- ----------- ------------ ------------ ----------- ------------
End of period+..................... $98,579,219 $69,741,063 $114,168,188 $110,233,412 $20,928,465 $ 21,349,720
=========== =========== ============ ============ =========== ============
--------
+ Includes accumulated
undistributed net investment
income (loss)..................... $ (534,231) $ 221,270 $ 219,069 $ 543,565 $ (42,173) $ 442,154
=========== =========== ============ ============ =========== ============
See Notes to Financial Statements
9
SUNAMERICA EQUITY FUNDS
FINANCIAL HIGHLIGHTS
INTERNATIONAL DIVIDEND STRATEGY FUND
------------------------------------
NET GAIN
(LOSS) ON
NET INVESTMENTS DISTRI- NET NET
ASSET NET (BOTH DIVIDENDS BUTIONS ASSET ASSETS
VALUE INVESTMENT REALIZED TOTAL FROM FROM NET FROM DISTRIBUTIONS TOTAL VALUE END OF
BEGINNING INCOME AND INVESTMENT INVESTMENT CAPITAL FROM RETURN DISTRI- END OF TOTAL PERIOD
PERIOD ENDED OF PERIOD (LOSS)(1) UNREALIZED) OPERATIONS INCOME GAINS OF CAPITAL BUTIONS PERIOD RETURN(2) (000'S)
------------ --------- ---------- ----------- ---------- ---------- ------- ------------- ------- ------ --------- --------
CLASS A
-
09/30/08 $19.80 $ 0.17 $(5.85) $(5.68) $ -- $(1.68) $ -- $(1.68) $12.44 (31.34)% $ 46,384
09/30/09 12.44 0.10 (0.71)(5) (0.61) (0.22) -- (0.03) (0.25) 11.58 (4.28) 122,343
09/30/10 11.58 (0.01) 0.33 0.32 (0.00) -- (0.06) (0.06) 11.84 2.79 100,990
09/30/11 11.84 0.08 (1.64) (1.56) (0.00) -- -- (0.00) 10.28 (13.17) 50,177
09/30/12 10.28 0.23 0.66 0.89 (0.26) -- -- (0.26) 10.91 8.77 51,309
03/31/13(6) 10.91 0.07 0.25 0.32 (0.18) -- -- (0.18) 11.05 2.98 72,834
CLASS B
-
09/30/08 18.44 0.04 (5.36) (5.32) -- (1.68) -- (1.68) 11.44 (31.72) 9,279
09/30/09 11.44 0.03 (0.63)(5) (0.60) (0.09) -- (0.03) (0.12) 10.72 (4.85) 12,960
09/30/10 10.72 (0.09) 0.31 0.22 -- -- -- -- 10.94 2.05 8,815
09/30/11 10.94 (0.02) (1.49) (1.51) -- -- -- -- 9.43 (13.80) 5,130
09/30/12 9.43 0.13 0.62 0.75 (0.14) -- -- (0.14) 10.04 7.97 4,572
03/31/13(6) 10.04 0.02 0.25 0.27 (0.17) -- -- (0.17) 10.14 2.67 5,222
CLASS C
-
09/30/08 18.42 0.05 (5.37) (5.32) -- (1.68) -- (1.68) 11.42 (31.77) 14,221
09/30/09 11.42 0.03 (0.63)(5) (0.60) (0.09) -- (0.03) (0.12) 10.70 (4.86) 25,123
09/30/10 10.70 (0.09) 0.32 0.23 -- -- -- -- 10.93 2.15 19,763
09/30/11 10.93 (0.02) (1.49) (1.51) -- -- -- -- 9.42 (13.82) 13,190
09/30/12 9.42 0.14 0.61 0.75 (0.14) -- -- (0.14) 10.03 7.98 12,571
03/31/13(6) 10.03 0.03 0.24 0.27 (0.17) -- -- (0.17) 10.13 2.68 19,313
CLASS I
-
09/30/08 19.96 0.17 (5.89) (5.72) -- (1.68) -- (1.68) 12.56 (31.29) 4,964
09/30/09 12.56 0.09 (0.70)(5) (0.61) (0.25) -- (0.03) (0.28) 11.67 (4.12) 4,799
09/30/10 11.67 (0.02) 0.35 0.33 (0.01) -- (0.06) (0.07) 11.93 2.80 2,600
09/30/11 11.93 0.08 (1.65) (1.57) (0.00) -- -- (0.00) 10.36 (13.13) 1,625
09/30/12 10.36 0.24 0.66 0.90 (0.27) -- -- (0.27) 10.99 8.84 1,289
03/31/13(6) 10.99 0.07 0.26 0.33 (0.19) -- -- (0.19) 11.13 2.98 1,210
RATIO
OF NET
RATIO OF INVESTMENT
EXPENSES INCOME (LOSS)
TO AVERAGE TO AVERAGE PORTFOLIO
NET ASSETS NET ASSETS TURNOVER
---------- ------------- ---------
1.90%(4) 0.98%(4) 199%
1.89(3)(4) 1.14(3)(4) 431
1.85(4) (0.11)(4) 295
1.84 0.63 262
1.90(3) 2.07(3) 248
1.90(3)(7) 1.25(3)(7) 11
2.55(3)(4) 0.25(3)(4) 199%
2.55(3)(4) 0.36(3)(4) 431
2.55(3)(4) (0.86)(3)(4) 295
2.55(3) (0.18)(3) 262
2.55(3) 1.29(3) 248
2.55(3)(7) 0.49(3)(7) 11
2.55(3)(4) 0.31(3)(4) 199%
2.55(3)(4) 0.41(3)(4) 431
2.55(3)(4) (0.82)(3)(4) 295
2.55(3) (0.14)(3) 262
2.55(3) 1.38(3) 248
2.55(3)(7) 0.57(3)(7) 11
1.80(3)(4) 1.01(3)(4) 199%
1.80(3)(4) 0.95(3)(4) 431
1.80(3)(4) (0.16)(3)(4) 295
1.80(3) 0.59(3) 262
1.80(3) 2.14(3) 248
1.80(3)(7) 1.22(3)(7) 11
--------
(1)Calculated based upon average shares outstanding.
(2)Total return is not annualized and does not reflect sales load. Total return
does include expense reimbursements and expense reductions.
(3)Net of the following expense reimbursements (recoupments) (based on average
net assets) (See Note 3):
09/30/08 09/30/09 09/30/10 09/30/11 09/30/12 03/31/13(6)(7)
-------- -------- -------- -------- -------- --------------
International Dividend Strategy Class A. -- % 0.00% -- % -- % 0.25% 0.21%
International Dividend Strategy Class B. 0.06 0.22 0.11 0.07 0.53 0.59
International Dividend Strategy Class C. 0.01 0.08 0.02 (0.00) 0.33 0.27
International Dividend Strategy Class I. 0.09 0.27 0.01 (0.09) 0.17 0.12
(4)Includes expense reimbursements, but excludes expense reductions. If the
expense reductions had been applied the ratio of expenses to average net
assets would have been lower and the ratio of net investment income to
average net assets would have been higher by:
09/30/08 09/30/09 09/30/10
-------- -------- --------
International Dividend Strategy Class A. 0.00% 0.00% 0.01%
International Dividend Strategy Class B. 0.00 0.00 0.00
International Dividend Strategy Class C. 0.00 0.00 0.01
International Dividend Strategy Class I. 0.00 0.00 0.00
(5)Includes the effect of a merger.
(6)Unaudited
(7)Annualized
See Notes to Financial Statements
10
SUNAMERICA EQUITY FUNDS
FINANCIAL HIGHLIGHTS -- (CONTINUED)
VALUE FUND
----------
NET GAIN
(LOSS) ON
NET INVESTMENTS DISTRI- NET NET
ASSET NET (BOTH DIVIDENDS BUTIONS ASSET ASSETS
VALUE INVESTMENT REALIZED TOTAL FROM FROM NET FROM DISTRIBUTIONS TOTAL VALUE END OF
BEGINNING INCOME AND INVESTMENT INVESTMENT CAPITAL FROM RETURN DISTRI- END OF TOTAL PERIOD
PERIOD ENDED OF PERIOD (LOSS)(1) UNREALIZED) OPERATIONS INCOME GAINS OF CAPITAL BUTIONS PERIOD RETURN(2) (000'S)
------------ --------- ---------- ----------- ---------- ---------- ------- ------------- ------- ------ --------- --------
CLASS A
-
09/30/08 $19.32 $ 0.19 $(3.86) $(3.67) $(0.21) $(2.70) $-- $(2.91) $12.74 (21.70)% $ 77,903
09/30/09 12.74 0.16 (1.88) (1.72) (0.23) -- -- (0.23) 10.79 (13.24) 52,112
09/30/10 10.79 0.14 0.30(5) 0.44 (0.07) -- -- (0.07) 11.16 4.13 122,673
09/30/11 11.16 0.08 (0.70) (0.62) (0.06) -- -- (0.06) 10.48 (5.63) 94,560
09/30/12 10.48 0.10 2.79 2.89 (0.13) -- -- (0.13) 13.24 27.84 90,132
03/31/13(7) 13.24 0.07 1.36 1.43 (0.11) -- -- (0.11) 14.56 10.92 93,936
CLASS B
-
09/30/08 18.24 0.09 (3.62) (3.53) (0.10) (2.70) -- (2.80) 11.91 (22.16) 21,304
09/30/09 11.91 0.10 (1.76) (1.66) (0.14) -- -- (0.14) 10.11 (13.78) 11,213
09/30/10 10.11 (0.00) 0.35(5) 0.35 (0.02) -- -- (0.02) 10.44 3.43 12,416
09/30/11 10.44 (0.01) (0.66) (0.67) -- -- -- -- 9.77 (6.42) 6,732
09/30/12 9.77 0.01 2.61 2.62 (0.04) -- -- (0.04) 12.35 26.92 5,277
03/31/13(7) 12.35 0.02 1.28 1.30 (0.01) -- -- (0.01) 13.64 10.54 4,964
CLASS C
-
09/30/08 18.24 0.09 (3.62) (3.53) (0.10) (2.70) -- (2.80) 11.91 (22.16) 14,194
09/30/09 11.91 0.09 (1.76) (1.67) (0.14) -- -- (0.14) 10.10 (13.86) 9,386
09/30/10 10.10 (0.00) 0.35(5) 0.35 (0.02) -- -- (0.02) 10.43 3.44 21,389
09/30/11 10.43 (0.01) (0.65) (0.66) -- -- -- -- 9.77 (6.33) 14,941
09/30/12 9.77 0.01 2.61 2.62 (0.06) -- -- (0.06) 12.33 26.95 14,688
03/31/13(7) 12.33 0.02 1.27 1.29 (0.03) -- -- (0.03) 13.59 10.49 15,217
CLASS Z
-
09/30/08 20.16 0.29 (4.05) (3.76) (0.28) (2.70) -- (2.98) 13.42 (21.28) 25,827
09/30/09 13.42 0.22 (1.98) (1.76) (0.30) -- -- (0.30) 11.36 (12.75) 21,138
09/30/10 11.36 0.15 0.38(5) 0.53 (0.11) -- -- (0.11) 11.78 4.72 22,591
09/30/11 11.78 0.19 (0.77) (0.58) (0.13) -- -- (0.13) 11.07 (5.03) 159
09/30/12 11.07 0.19 2.94 3.13 (0.24) -- -- (0.24) 13.96 28.63 137
03/31/13(7) 13.96 0.13 1.42 1.55 (0.20) -- -- (0.20) 15.31 11.28 52
RATIO
OF NET
RATIO OF INVESTMENT
EXPENSES INCOME (LOSS)
TO AVERAGE TO AVERAGE PORTFOLIO
NET ASSETS(4) NET ASSETS(4) TURNOVER
------------- ------------- ---------
1.63%(3) 1.23%(3) 207%
1.63(3) 1.68(3) 204
1.61(3) 0.64(3) 157(6)
1.50(3) 0.67(3) 231
1.53 0.80 214
1.59(8) 0.95(8) 96
2.28(3) 0.58(3) 207%
2.28(3) 1.06(3) 204
2.28(3) (0.02)(3) 157(6)
2.28(3) (0.13)(3) 231
2.28(3) 0.08(3) 214
2.28(3)(8) 0.27(3)(8) 96
2.28(3) 0.58(3) 207%
2.28(3) 1.02(3) 204
2.28(3) (0.02)(3) 157(6)
2.26(3) (0.10)(3) 231
2.26 0.08 214
2.28(3)(8) 0.25(3)(8) 96
1.06(3) 1.81(3) 207%
1.06(3) 2.20(3) 204
0.98(3) 1.26(3) 157(6)
0.87(3) 1.05(3) 231
0.92 1.45 214
0.94(8) 1.73(8) 96
--------
(1)Calculated based upon average shares outstanding.
(2)Total return is not annualized and does not reflect sales load. Total return
does include expense reimbursements and expense reductions.
(3)Net of the following expense reimbursements (recoupments) (based on average
net assets) (See Note 3):
09/30/08 09/30/09 09/30/10 09/30/11 09/30/12 03/31/13(7)(8)
-------- -------- -------- -------- -------- --------------
Value Class A........................... 0.11% 0.21% (0.10)% (0.02)% -- % -- %
Value Class B........................... 0.14 0.29 0.01 (0.04) 0.13 0.30
Value Class C........................... 0.14 0.28 (0.08) (0.08) -- 0.01
Value Class Z........................... 0.10 0.13 (0.09) (0.00) -- --
(4)Includes expense reimbursements, but excludes expense reductions. If the
expense reductions had been applied the ratio of expenses to average net
assets would have been lower and the ratio of net investment income to
average net assets would have been higher by:
09/30/08 09/30/09 09/30/10 09/30/11 09/30/12 03/31/13(7)(8)
-------- -------- -------- -------- -------- --------------
Value Class A........................... 0.03% 0.02% 0.01% 0.01% 0.00% 0.02%
Value Class B........................... 0.03 0.02 0.01 0.01 0.00 0.02
Value Class C........................... 0.03 0.02 0.01 0.01 0.00 0.02
Value Class Z........................... 0.03 0.02 0.01 0.00 0.00 0.02
(5)Includes the effect of a merger.
(6)Excludes purchases due to a fund merger.
(7)Unaudited
(8)Annualized
See Notes to Financial Statements
11
SUNAMERICA EQUITY FUNDS
FINANCIAL HIGHLIGHTS -- (CONTINUED)
JAPAN FUND
----------
NET GAIN
(LOSS) ON
NET INVESTMENTS DISTRI- NET NET
ASSET NET (BOTH DIVIDENDS BUTIONS ASSET ASSETS
VALUE INVESTMENT REALIZED TOTAL FROM FROM NET FROM DISTRIBUTIONS TOTAL VALUE END OF
BEGINNING INCOME AND INVESTMENT INVESTMENT CAPITAL FROM RETURN DISTRI- END OF TOTAL PERIOD
PERIOD ENDED OF PERIOD (LOSS)(1) UNREALIZED) OPERATIONS INCOME GAINS OF CAPITAL BUTIONS PERIOD RETURN(2) (000'S)
------------ --------- ---------- ----------- ---------- ---------- ------- ------------- ------- ------ --------- -------
CLASS A
09/30/08 $14.00 $(0.00) $(5.52) $(5.52) $ -- $(0.13) $(0.01) $(0.14) $8.34 (39.79)% $16,830
09/30/09 8.34 0.01 (0.01) 0.00 (0.00) -- -- (0.00) 8.34 0.02(4) 68,492
09/30/10 8.34 (0.02) 1.07 1.05 (0.29) -- -- (0.29) 9.10 13.01 58,538
09/30/11 9.10 0.00 (1.11) (1.11) (0.26) -- -- (0.26) 7.73 (12.68) 31,292
09/30/12 7.73 0.04 0.02 0.06 (0.01) (1.37) -- (1.38) 6.41 1.38 20,714
03/31/13(5) 6.41 (0.00) 0.88 0.88 (0.16) -- -- (0.16) 7.13 14.03 20,107
CLASS B
09/30/08 13.88 (0.08) (5.45) (5.53) -- (0.13) (0.01) (0.14) 8.21 (40.21) 633
09/30/09 8.21 (0.04) 0.00 (0.04) -- -- -- -- 8.17 (0.49)(4) 313
09/30/10 8.17 (0.07) 1.04 0.97 (0.22) -- -- (0.22) 8.92 12.16 377
09/30/11 8.92 (0.05) (1.09) (1.14) (0.23) -- -- (0.23) 7.55 (13.24) 316
09/30/12 7.55 (0.01) 0.04 0.03 -- (1.37) -- (1.37) 6.21 0.87 197
03/31/13(5) 6.21 (0.02) 0.84 0.82 (0.10) -- -- (0.10) 6.93 13.47 201
CLASS C
09/30/08 13.88 (0.09) (5.44) (5.53) -- (0.13) (0.01) (0.14) 8.21 (40.20) 2,199
09/30/09 8.21 (0.04) (0.01) (0.05) -- -- -- -- 8.16 (0.61)(4) 724
09/30/10 8.16 (0.07) 1.05 0.98 (0.22) -- -- (0.22) 8.92 12.30 691
09/30/11 8.92 (0.04) (1.11) (1.15) (0.23) -- -- (0.23) 7.54 (13.35) 888
09/30/12 7.54 (0.02) 0.05 0.03 -- (1.37) -- (1.37) 6.20 0.85 438
03/31/13(5) 6.20 (0.00) 0.83 0.83 (0.10) -- -- (0.10) 6.93 13.66 620
RATIO
OF NET
RATIO OF INVESTMENT
EXPENSES INCOME (LOSS)
TO AVERAGE TO AVERAGE PORTFOLIO
NET ASSETS(3) NET ASSETS(3) TURNOVER
------------- ------------- ---------
1.90% (0.04)% 93%
1.90 0.19 148
1.90 (0.24) 77
1.90 0.04 79
1.90 0.52 192
1.90(6) (0.03)(6) 57
2.55 (0.68) 93%
2.55 (0.53) 148
2.55 (0.85) 77
2.55 (0.55) 79
2.55 (0.16) 192
2.55(6) (0.63)(6) 57
2.55 (0.78) 93%
2.55 (0.58) 148
2.55 (0.86) 77
2.55 (0.48) 79
2.55 (0.23) 192
2.55(6) (0.10)(6) 57
--------
(1)Calculated based upon average shares outstanding.
(2)Total return is not annualized and does not reflect sales load. Total return
does include expense reimbursements and expense reductions.
(3)Net of the following expense reimbursements (based on average net assets)
(See Note 3):
09/30/08 09/30/09 09/30/10 09/30/11 09/30/12 03/31/13(5)(6)
-------- -------- -------- -------- -------- --------------
Japan Class A........................... 0.54% 0.31% 0.18% 0.27% 0.59% 0.61%
Japan Class B........................... 1.53 4.07 5.60 3.06 6.15 4.49
Japan Class C........................... 0.77 1.68 2.66 1.19 2.80 2.29
(4)The Fund's performance was increased by less than 0.01% from gains on
disposal of investments in violation of investment restrictions.
(5)Unaudited
(6)Annualized
See Notes to Financial Statements
12
SUNAMERICA INTERNATIONAL DIVIDEND STRATEGY FUND
PORTFOLIO PROFILE -- MARCH 31, 2013 -- (UNAUDITED)
INDUSTRY ALLOCATION*
Telephone-Integrated................... 9.8%
Television............................. 7.8
Electric-Integrated.................... 5.4
Cellular Telecom....................... 5.4
Medical-Drugs.......................... 4.6
Chemicals-Diversified.................. 4.1
Non-Ferrous Metals..................... 4.1
Real Estate Operations & Development... 4.0
Oil Companies-Integrated............... 4.0
Steel-Producers........................ 3.1
Insurance-Multi-line................... 3.0
Gambling (Non-Hotel)................... 2.4
Computer Services...................... 2.4
Computers-Periphery Equipment.......... 2.4
Machinery-General Industrial........... 2.4
Miscellaneous Manufacturing............ 2.3
Building-Heavy Construction............ 2.2
Metal-Copper........................... 2.2
Repurchase Agreements.................. 2.1
Telecom Services....................... 2.1
Metal-Diversified...................... 2.1
Oil Companies-Exploration & Production. 2.0
Electric-Generation.................... 1.9
Building & Construction-Misc........... 1.9
Shipbuilding........................... 1.8
Coal................................... 1.6
Rubber & Vinyl......................... 1.6
Metal-Iron............................. 1.5
Investment Companies................... 1.5
Building-Residential/Commercial........ 1.4
Petrochemicals......................... 1.3
Electronic Components-Misc............. 1.3
Wireless Equipment..................... 1.1
Electric-Transmission.................. 1.0
Electric-Distribution.................. 0.7
Exchange-Traded Funds.................. 0.2
----
98.7%
====
COUNTRY ALLOCATION*
Brazil......... 16.3%
Taiwan......... 9.5
Israel......... 7.2
Finland........ 6.6
France......... 6.5
Poland......... 5.7
South Korea.... 4.9
United States.. 4.5
Sweden......... 4.3
Italy.......... 4.2
Singapore...... 4.0
Indonesia...... 3.2
Germany........ 3.0
Mexico......... 2.5
Greece......... 2.4
Spain.......... 2.4
China.......... 2.3
Denmark........ 2.0
United Kingdom. 2.0
Canada......... 2.0
Belgium........ 1.6
Chile.......... 1.6
----
98.7%
====
--------
*Calculated as a percentage of net assets
13
SUNAMERICA INTERNATIONAL DIVIDEND STRATEGY FUND
PORTFOLIO OF INVESTMENTS -- MARCH 31, 2013 -- (UNAUDITED)
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
------------------------------------------------------------------------
COMMON STOCK -- 86.4%
BELGIUM -- 1.6%
Belgacom SA....................................... 63,230 $1,572,176
----------
BERMUDA -- 0.0%
Peace Mark Holdings, Ltd.+(1)(2).................. 800,000 0
Peregrine Investments Holdings, Ltd.+(1)(2)....... 91,000 0
----------
0
----------
BRAZIL -- 9.3%
Brookfield Incorporacoes SA....................... 1,126,300 1,396,573
Cia Siderurgica Nacional SA....................... 330,600 1,491,109
Light SA.......................................... 147,400 1,456,342
Porto Seguro SA................................... 213,100 2,976,084
Tractebel Energia SA.............................. 109,300 1,875,797
----------
9,195,905
----------
CANADA -- 2.0%
Canadian Oil Sands, Ltd........................... 95,041 1,955,545
----------
CHILE -- 1.6%
CAP SA............................................ 48,444 1,568,800
----------
CHINA -- 2.3%
China International Marine Containers Group Co.,
Ltd., Class H+................................... 1,402,300 2,304,893
----------
DENMARK -- 2.0%
TDC A/S........................................... 257,869 1,981,681
----------
FINLAND -- 6.6%
Elisa Oyj......................................... 87,744 1,629,949
Metso Oyj......................................... 54,537 2,320,527
Orion Oyj, Class B................................ 96,310 2,529,889
----------
6,480,365
----------
FRANCE -- 6.5%
Bouygues SA....................................... 68,339 1,853,841
Societe Television Francaise 1.................... 230,829 2,587,845
Total SA.......................................... 40,853 1,956,414
----------
6,398,100
----------
GREECE -- 2.4%
OPAP SA........................................... 303,658 2,398,024
----------
INDONESIA -- 3.2%
Indo Tambangraya Megah Tbk PT..................... 430,500 1,572,704
Vale Indonesia Tbk PT............................. 6,547,500 1,600,238
----------
3,172,942
----------
ISRAEL -- 7.2%
Bezeq The Israeli Telecommunication Corp., Ltd.... 1,674,666 2,314,920
Israel Chemicals, Ltd............................. 162,188 2,090,711
Partner Communications Co., Ltd................... 436,767 2,685,733
----------
7,091,364
----------
ITALY -- 4.2%
Eni SpA........................................... 86,648 1,947,281
Mediaset SpA...................................... 1,066,535 2,178,106
----------
4,125,387
----------
MEXICO -- 2.5%
Grupo Mexico SAB de CV, Class B................... 611,400 2,469,631
----------
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
----------------------------------------------------------------------
POLAND -- 5.7%
KGHM Polska Miedz SA........................... 42,051 $ 2,036,099
PGE SA......................................... 311,014 1,597,538
Synthos SA..................................... 1,031,353 1,993,717
-----------
5,627,354
-----------
SINGAPORE -- 4.0%
Keppel Land, Ltd............................... 698,000 2,216,677
Yangzijiang Shipbuilding Holdings, Ltd......... 2,222,000 1,737,267
-----------
3,953,944
-----------
SOUTH KOREA -- 4.9%
KT Corp........................................ 67,630 2,148,143
SK Telecom Co., Ltd............................ 16,160 2,624,628
-----------
4,772,771
-----------
SPAIN -- 2.4%
Indra Sistemas SA.............................. 199,304 2,376,222
-----------
SWEDEN -- 4.3%
Skanska AB, Class B............................ 121,612 2,195,707
Tele2 AB, Class B.............................. 117,178 2,036,629
-----------
4,232,336
-----------
TAIWAN -- 9.5%
China Petrochemical Development Corp........... 2,362,850 1,279,464
E Ink Holdings, Inc............................ 1,589,000 1,257,348
Farglory Land Development Co., Ltd............. 987,000 1,833,355
HTC Corp....................................... 136,000 1,114,904
Lite-On Technology Corp........................ 1,446,910 2,338,342
TSRC Corp...................................... 785,800 1,554,474
-----------
9,377,887
-----------
UNITED KINGDOM -- 2.0%
AstraZeneca PLC................................ 39,423 1,976,442
-----------
UNITED STATES -- 2.2%
SoftBrands, Inc. +(1)(2)....................... 40 0
Southern Copper Corp........................... 56,552 2,124,659
-----------
2,124,659
-----------
TOTAL COMMON STOCK
(cost $82,572,592)............................ 85,156,428
-----------
PREFERRED STOCK -- 10.0%
BRAZIL -- 7.0%
Bradespar SA................................... 112,300 1,460,718
Centrais Eletricas Brasileiras SA, Class B..... 186,000 1,166,951
Cia de Transmissao de Energia Eletrica
Paulista...................................... 56,200 930,073
Cia Energetica de Minas Gerais................. 95,500 1,114,343
Eletropaulo Metropolitana Eletricidade de Sao
Paulo SA...................................... 144,400 705,504
Vale SA, Class A............................... 92,200 1,514,007
-----------
6,891,596
-----------
GERMANY -- 3.0%
ProSiebenSat.1 Media AG........................ 82,560 2,947,698
-----------
TOTAL PREFERRED STOCK
(cost $12,080,979)............................ 9,839,294
-----------
14
SUNAMERICA INTERNATIONAL DIVIDEND STRATEGY FUND
PORTFOLIO OF INVESTMENTS -- MARCH 31, 2013 -- (UNAUDITED) (CONTINUED)
SHARES/
PRINCIPAL VALUE
SECURITY DESCRIPTION AMOUNT (NOTE 2)
--------------------------------------------------------------
EXCHANGE-TRADED FUNDS -- 0.2%
iShares MSCI ACWI ex US Index Fund
(cost $192,695)..................... 4,474 $ 191,756
-----------
TOTAL LONG-TERM INVESTMENT SECURITIES
(cost $94,846,266).................. 95,187,478
-----------
REPURCHASE AGREEMENT -- 2.1%
State Street Bank & Trust Co. Joint
Repurchase Agreement(3)
(cost $2,066,000)................... $2,066,000 2,066,000
-----------
TOTAL INVESTMENTS --
(cost $96,912,266)(4)............... 98.7% 97,253,478
Other assets less liabilities.......... 1.3 1,325,741
---------- -----------
NET ASSETS -- 100.0% $98,579,219
========== ===========
--------
+ Non-income producing security
(1)Fair valued security. Securities are classified as Level 3 based on the
securities valuation inputs; see Note 2.
(2)Illiquid security. At March 31, 2013, the aggregate value of these
securities was $0 representing 0.0% of net assets.
(3)See Note 2 for details of Joint Repurchase Agreements.
(4)See Note 6 for cost of investments on a tax basis.
The following is a summary of the inputs used to value the Fund's net assets as
of March 31, 2013 (see Note 2):
LEVEL 1 -- UNADJUSTED LEVEL 2 -- OTHER LEVEL 3 -- SIGNIFICANT
QUOTED PRICES OBSERVABLE INPUTS UNOBSERVABLE INPUTS TOTAL
- --------------------- ----------------- ---------------------- -----------
ASSETS
Long-Term Investment Securities:
Common Stock:
Bermuda....................... $ -- $ -- $ 0 $ 0
Brazil........................ 9,195,905 -- -- 9,195,905
Finland....................... 6,480,365 -- -- 6,480,365
France........................ 6,398,100 -- -- 6,398,100
Israel........................ 7,091,364 -- -- 7,091,364
Poland........................ 5,627,354 -- -- 5,627,354
Taiwan........................ 9,377,887 -- -- 9,377,887
United States................. 2,124,659 -- 0 2,124,659
Other Countries*.............. 38,860,794 -- -- 38,860,794
Preferred Stock:
Brazil........................ 6,891,596 -- -- 6,891,596
Germany....................... 2,947,698 -- -- 2,947,698
Exchange Traded Funds.......... 191,756 -- -- 191,756
Repurchase Agreement............. -- 2,066,000 -- 2,066,000
----------- ---------- --- -----------
TOTAL............................ $95,187,478 $2,066,000 $ 0 $97,253,478
=========== ========== === ===========
--------
* Sum of all other countries each of which individually has an aggregate
market value of less than 5% of net assets. For a detailed presentation of
securities by country classification, please refer to the Portfolio of
Investments.
The Fund's policy is to recognize transfers between Levels as of the end of the
reporting period. There were no transfers between Levels during the reporting
period.
At the beginning and end of the reporting period, Level 3 investments in
securities were not considered a material portion of the Fund.
See Notes to Financial Statements
15
SUNAMERICA VALUE FUND
PORTFOLIO PROFILE -- MARCH 31, 2013 -- (UNAUDITED)
INDUSTRY ALLOCATION*
Banks-Super Regional................... 7.9%
Oil Companies-Exploration & Production. 7.2
Oil Companies-Integrated............... 7.0
Medical-Drugs.......................... 6.6
Repurchase Agreement................... 6.0
Diversified Banking Institutions....... 5.9
Insurance-Multi-line................... 4.3
Computers.............................. 3.9
Cable/Satellite TV..................... 3.1
Medical-HMO............................ 2.9
Metal-Copper........................... 2.9
Telephone-Integrated................... 2.6
Applications Software.................. 2.5
Multimedia............................. 2.1
Diversified Manufacturing Operations... 2.0
Electronic Components-Semiconductors... 1.9
Oil Field Machinery & Equipment........ 1.9
Networking Products.................... 1.8
Oil-Field Services..................... 1.8
Apparel Manufacturers.................. 1.7
Retail-Drug Store...................... 1.7
Aerospace/Defense-Equipment............ 1.6
Oil & Gas Drilling..................... 1.6
Food-Misc./Diversified................. 1.6
Machinery-Construction & Mining........ 1.6
Tobacco................................ 1.5
Aerospace/Defense...................... 1.5
Insurance-Property/Casualty............ 1.5
Cruise Lines........................... 1.4
Enterprise Software/Service............ 1.4
Medical-Generic Drugs.................. 1.4
Beverages-Non-alcoholic................ 1.4
Cosmetics & Toiletries................. 1.3
Instruments-Controls................... 1.3
Chemicals-Diversified.................. 1.3
Retail-Discount........................ 1.2
Medical Products....................... 1.2
Engineering/R&D Services............... 1.2
Pharmacy Services...................... 1.0
Cellular Telecom....................... 1.0
-----
103.7%
=====
--------
*Calculated as a percentage of net assets
16
SUNAMERICA VALUE FUND
PORTFOLIO OF INVESTMENTS -- MARCH 31, 2013 -- (UNAUDITED)
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
--------------------------------------------------------
COMMON STOCK -- 97.7%
AEROSPACE/DEFENSE -- 1.5%
Boeing Co.......................... 20,000 $1,717,000
----------
AEROSPACE/DEFENSE-EQUIPMENT -- 1.6%
United Technologies Corp........... 20,000 1,868,600
----------
APPAREL MANUFACTURERS -- 1.7%
Coach, Inc......................... 40,000 1,999,600
----------
APPLICATIONS SOFTWARE -- 2.5%
Microsoft Corp..................... 100,000 2,861,000
----------
BANKS-SUPER REGIONAL -- 7.9%
Capital One Financial Corp......... 30,000 1,648,500
PNC Financial Services Group, Inc.. 30,000 1,995,000
US Bancorp......................... 50,000 1,696,500
Wells Fargo & Co................... 100,000 3,699,000
----------
9,039,000
----------
BEVERAGES-NON-ALCOHOLIC -- 1.4%
PepsiCo, Inc....................... 20,000 1,582,200
----------
CABLE/SATELLITE TV -- 3.1%
Comcast Corp., Class A............. 40,000 1,680,400
DISH Network Corp., Class A........ 50,000 1,895,000
----------
3,575,400
----------
CELLULAR TELECOM -- 1.0%
Vodafone Group PLC ADR............. 40,000 1,136,400
----------
CHEMICALS-DIVERSIFIED -- 1.3%
E.I. du Pont de Nemours & Co....... 30,000 1,474,800
----------
COMPUTERS -- 3.9%
Apple, Inc......................... 10,000 4,426,300
----------
COSMETICS & TOILETRIES -- 1.3%
Procter & Gamble Co................ 20,000 1,541,200
----------
CRUISE LINES -- 1.4%
Royal Caribbean Cruises, Ltd....... 50,000 1,661,000
----------
DIVERSIFIED BANKING INSTITUTIONS -- 5.9%
Bank of America Corp............... 100,000 1,218,000
Citigroup, Inc..................... 50,000 2,212,000
JPMorgan Chase & Co................ 70,000 3,322,200
----------
6,752,200
----------
DIVERSIFIED MANUFACTURING OPERATIONS -- 2.0%
General Electric Co................ 100,000 2,312,000
----------
ELECTRONIC COMPONENTS-SEMICONDUCTORS -- 1.9%
Intel Corp......................... 100,000 2,185,000
----------
ENGINEERING/R&D SERVICES -- 1.2%
Fluor Corp......................... 20,000 1,326,600
----------
ENTERPRISE SOFTWARE/SERVICE -- 1.4%
Oracle Corp........................ 50,000 1,617,000
----------
FOOD-MISC./DIVERSIFIED -- 1.6%
ConAgra Foods, Inc................. 50,000 1,790,500
----------
INSTRUMENTS-CONTROLS -- 1.3%
Honeywell International, Inc....... 20,000 1,507,000
----------
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
--------------------------------------------------------------
INSURANCE-MULTI-LINE -- 4.3%
Allstate Corp............................ 30,000 $1,472,100
Hartford Financial Services Group, Inc... 60,000 1,548,000
MetLife, Inc............................. 50,000 1,901,000
----------
4,921,100
----------
INSURANCE-PROPERTY/CASUALTY -- 1.5%
Travelers Cos., Inc...................... 20,000 1,683,800
----------
MACHINERY-CONSTRUCTION & MINING -- 1.6%
Joy Global, Inc.......................... 30,000 1,785,600
----------
MEDICAL PRODUCTS -- 1.2%
Covidien PLC............................. 20,000 1,356,800
----------
MEDICAL-DRUGS -- 6.6%
Johnson & Johnson........................ 30,000 2,445,900
Merck & Co., Inc......................... 50,000 2,211,500
Pfizer, Inc.............................. 100,000 2,886,000
----------
7,543,400
----------
MEDICAL-GENERIC DRUGS -- 1.4%
Teva Pharmaceutical Industries, Ltd. ADR. 40,000 1,587,200
----------
MEDICAL-HMO -- 2.9%
Aetna, Inc............................... 20,000 1,022,400
UnitedHealth Group, Inc.................. 40,000 2,288,400
----------
3,310,800
----------
METAL-COPPER -- 2.9%
Freeport-McMoRan Copper & Gold, Inc...... 100,000 3,310,000
----------
MULTIMEDIA -- 2.1%
Time Warner, Inc......................... 20,000 1,152,400
Viacom, Inc., Class B.................... 20,000 1,231,400
----------
2,383,800
----------
NETWORKING PRODUCTS -- 1.8%
Cisco Systems, Inc....................... 100,000 2,091,000
----------
OIL & GAS DRILLING -- 1.6%
Ensco PLC, Class A....................... 30,000 1,800,000
----------
OIL COMPANIES-EXPLORATION & PRODUCTION -- 7.2%
Anadarko Petroleum Corp.................. 30,000 2,623,500
Apache Corp.............................. 20,000 1,543,200
Devon Energy Corp........................ 30,000 1,692,600
Occidental Petroleum Corp................ 30,000 2,351,100
----------
8,210,400
----------
OIL COMPANIES-INTEGRATED -- 7.0%
Chevron Corp............................. 30,000 3,564,600
Exxon Mobil Corp......................... 30,000 2,703,300
Marathon Oil Corp........................ 50,000 1,686,000
----------
7,953,900
----------
OIL FIELD MACHINERY & EQUIPMENT -- 1.9%
National Oilwell Varco, Inc.............. 30,000 2,122,500
----------
OIL-FIELD SERVICES -- 1.8%
Halliburton Co........................... 50,000 2,020,500
----------
PHARMACY SERVICES -- 1.0%
Express Scripts Holding Co.+............. 20,000 1,153,000
----------
17
SUNAMERICA VALUE FUND
PORTFOLIO OF INVESTMENTS -- MARCH 31, 2013 -- (UNAUDITED) (CONTINUED)
SHARES/
PRINCIPAL VALUE
SECURITY DESCRIPTION AMOUNT (NOTE 2)
----------------------------------------------------------------
COMMON STOCK (CONTINUED)
RETAIL-DISCOUNT -- 1.2%
Target Corp.......................... 20,000 $ 1,369,000
------------
RETAIL-DRUG STORE -- 1.7%
Walgreen Co.......................... 40,000 1,907,200
------------
TELEPHONE-INTEGRATED -- 2.6%
AT&T, Inc............................ 40,000 1,467,600
Verizon Communications, Inc.......... 30,000 1,474,500
------------
2,942,100
------------
TOBACCO -- 1.5%
Altria Group, Inc.................... 50,000 1,719,500
------------
TOTAL LONG-TERM INVESTMENT SECURITIES
(cost $99,826,451).................. 111,544,400
------------
REPURCHASE AGREEMENT -- 6.0%
State Street Bank & Trust Co. Joint
Repurchase Agreement(1)
(cost $6,875,000)................... $6,875,000 6,875,000
------------
TOTAL INVESTMENTS
(cost $106,701,451)(2).............. 103.7% 118,419,400
Liabilities in excess of other assets.. (3.7) (4,251,212)
---------- ------------
NET ASSETS 100.0% $114,168,188
========== ============
--------
+ Non-income producing security
(1)See Note 2 for details of Joint Repurchase Agreements.
(2)See Note 6 for cost of investments on a tax basis.
ADR-- American Depository Receipt
The following is a summary of the inputs used to value the Fund's net assets as
of March 31, 2013 (see Note 2):
LEVEL 1 -- UNADJUSTED LEVEL 2 -- OTHER LEVEL 3 -- SIGNIFICANT
QUOTED PRICES OBSERVABLE INPUTS UNOBSERVABLE INPUTS TOTAL
- --------------------- ----------------- ---------------------- ------------
ASSETS:
Long-Term Investment Securities:
Common Stock:
Banks-Super Regional.................... $ 9,039,000 $ -- $-- $ 9,039,000
Diversified Banking Institutions........ 6,752,200 -- -- 6,752,200
Medical-Drugs........................... 7,543,400 -- -- 7,543,400
Oil Companies-Exploration & Production.. 8,210,400 -- -- 8,210,400
Oil Companies-Integrated................ 7,953,900 -- -- 7,953,900
Other Industries*....................... 72,045,500 -- -- 72,045,500
Repurchase Agreement....................... -- 6,875,000 -- 6,875,000
------------ ---------- --- ------------
Total...................................... $111,544,400 $6,875,000 $-- $118,419,400
============ ========== === ============
--------
* Sum of all other industries each of which individually has an aggregate
market value of less than 5% of net assets. For a detailed presentation of
securities by industry classification, please refer to the Portfolio of
Investments.
The Fund's policy is to recognize transfers between Levels as of the end of the
reporting period. There were no transfers between Levels during the reporting
period.
See Notes to Financial Statements
18
SUNAMERICA JAPAN FUND
PORTFOLIO PROFILE -- MARCH 31, 2013 -- (UNAUDITED)
INDUSTRY ALLOCATION*
Auto/Truck Parts & Equipment-Original.. 9.8%
Auto-Cars/Light Trucks................. 6.4
Electric Products-Misc................. 4.9
Diversified Banking Institutions....... 4.6
Telephone-Integrated................... 4.2
Television............................. 3.3
Electronic Components-Misc............. 3.3
Chemicals-Diversified.................. 2.8
Medical-Drugs.......................... 2.8
Insurance-Property/Casualty............ 2.7
Oil Refining & Marketing............... 2.6
Banks-Commercial....................... 2.6
Retail-Consumer Electronics............ 2.5
Chemicals-Specialty.................... 2.4
Cosmetics & Toiletries................. 2.2
E-Commerce/Services.................... 2.0
Leisure Products....................... 2.0
Tobacco................................ 1.9
Steel-Producers........................ 1.9
Retail-Discount........................ 1.9
Entertainment Software................. 1.8
Oil Companies-Exploration & Production. 1.6
Travel Services........................ 1.6
Machine Tools & Related Products....... 1.5
Rubber-Tires........................... 1.5
Casino Services........................ 1.4
Steel-Specialty........................ 1.4
Electronic Measurement Instruments..... 1.4
Machinery-General Industrial........... 1.3
Transport-Marine....................... 1.3
Computers-Integrated Systems........... 1.2
Finance-Leasing Companies.............. 1.1
Lighting Products & Systems............ 1.1
Beverages-Non-alcoholic................ 1.0
Photo Equipment & Supplies............. 1.0
Distribution/Wholesale................. 1.0
Transport-Truck........................ 1.0
Office Automation & Equipment.......... 0.9
Web Portals/ISP........................ 0.9
Rubber & Vinyl......................... 0.8
Retail-Catalog Shopping................ 0.8
Transport-Services..................... 0.8
Semiconductor Equipment................ 0.6
Internet Content-Entertainment......... 0.5
Water Treatment Systems................ 0.5
E-Commerce/Products.................... 0.5
Medical-Nursing Homes.................. 0.4
Non-Ferrous Metals..................... 0.4
Commercial Services.................... 0.3
----
96.4%
====
COUNTRY ALLOCATION*
Japan..... 96.4%
Australia. 0.0
Bermuda... 0.0
----
96.4%
====
--------
*Calculated as a percentage of net assets
19
SUNAMERICA JAPAN FUND
PORTFOLIO OF INVESTMENTS -- MARCH 31, 2013 -- (UNAUDITED)
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
-----------------------------------------------------------------
COMMON STOCK -- 96.4%
AUTO-CARS/LIGHT TRUCKS -- 6.4%
Honda Motor Co., Ltd........................ 10,500 $ 396,342
Isuzu Motors, Ltd........................... 48,000 282,863
Nissan Motor Co., Ltd....................... 68,300 656,312
----------
1,335,517
----------
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL -- 9.8%
Aisin Seiki Co., Ltd........................ 5,850 214,297
Exedy Corp.................................. 17,700 411,208
Keihin Corp................................. 11,100 153,689
NOK Corp.................................... 6,500 93,173
Stanley Electric Co., Ltd................... 18,630 327,775
TACHI-S Co., Ltd............................ 33,360 591,894
Tokai Rika Co., Ltd......................... 14,850 263,005
----------
2,055,041
----------
BANKS-COMMERCIAL -- 2.6%
Sumitomo Mitsui Financial Group, Inc........ 13,410 537,511
----------
BEVERAGES-NON-ALCOHOLIC -- 1.0%
DyDo Drinco, Inc............................ 4,600 213,198
----------
CASINO SERVICES -- 1.4%
Sankyo Co., Ltd............................. 6,390 302,266
----------
CHEMICALS-DIVERSIFIED -- 2.8%
Mitsubishi Gas Chemical Co., Inc............ 46,000 303,313
Showa Denko KK.............................. 194,000 290,444
----------
593,757
----------
CHEMICALS-SPECIALTY -- 2.4%
Lintec Corp................................. 7,600 142,349
Tokyo Ohka Kogyo Co., Ltd................... 17,400 368,212
----------
510,561
----------
COAL -- 0.0%
White Energy Co., Ltd.+..................... 446 79
----------
COMMERCIAL SERVICES -- 0.3%
Nichii Gakkan Co............................ 7,300 64,877
----------
COMPUTERS-INTEGRATED SYSTEMS -- 1.2%
Net One Systems Co., Ltd.................... 29,200 254,857
----------
COSMETICS & TOILETRIES -- 2.2%
Pigeon Corp................................. 2,700 196,953
Pola Orbis Holdings, Inc.................... 8,290 263,100
----------
460,053
----------
DISTRIBUTION/WHOLESALE -- 1.0%
Hitachi High-Technologies Corp.............. 9,700 203,929
----------
DIVERSIFIED BANKING INSTITUTIONS -- 4.6%
Mitsubishi UFJ Financial Group, Inc......... 160,600 951,527
----------
E-COMMERCE/PRODUCTS -- 0.5%
Start Today Co., Ltd........................ 7,600 93,931
----------
E-COMMERCE/SERVICES -- 2.0%
Dena Co., Ltd............................... 7,890 214,047
Rakuten, Inc................................ 20,810 211,459
----------
425,506
----------
ELECTRIC PRODUCTS-MISC. -- 4.9%
Brother Industries, Ltd..................... 27,759 290,028
Funai Electric Co., Ltd.+................... 5,100 62,491
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
-----------------------------------------------------------------
ELECTRIC PRODUCTS-MISC. (CONTINUED)
Hitachi, Ltd................................. 66,500 $ 383,409
Mitsubishi Electric Corp..................... 36,180 290,808
----------
1,026,736
----------
ELECTRONIC COMPONENTS-MISC. -- 3.3%
Dainippon Screen Manufacturing Co., Ltd.+.... 24,000 110,597
Futaba Corp./Chiba........................... 18,700 197,563
Kyocera Corp................................. 1,100 102,899
Toshiba Corp................................. 56,500 283,160
----------
694,219
----------
ELECTRONIC MEASUREMENT INSTRUMENTS -- 1.4%
Azbil Corp................................... 13,490 283,321
----------
ENTERTAINMENT SOFTWARE -- 1.8%
Konami Corp.................................. 18,200 366,203
----------
FINANCE-LEASING COMPANIES -- 1.1%
Mitsubishi UFJ Lease & Finance Co., Ltd...... 44,900 236,943
----------
INSURANCE-PROPERTY/CASUALTY -- 2.7%
Tokio Marine Holdings, Inc................... 20,300 571,193
----------
INTERNET CONTENT-ENTERTAINMENT -- 0.5%
Gree, Inc.................................... 8,500 104,964
----------
LEISURE PRODUCTS -- 2.0%
Sega Sammy Holdings, Inc..................... 20,860 423,269
----------
LIGHTING PRODUCTS & SYSTEMS -- 1.1%
Ushio, Inc................................... 21,400 221,317
----------
MACHINE TOOLS & RELATED PRODUCTS -- 1.5%
THK Co., Ltd................................. 16,300 314,646
----------
MACHINERY-GENERAL INDUSTRIAL -- 1.3%
Amada Co., Ltd............................... 41,230 275,363
----------
MEDICAL-DRUGS -- 2.8%
Eisai Co., Ltd............................... 8,700 387,980
Shionogi & Co., Ltd.......................... 9,600 198,055
----------
586,035
----------
MEDICAL-NURSING HOMES -- 0.4%
Message Co., Ltd............................. 34 91,697
----------
MISCELLANEOUS MANUFACTURING -- 0.0%
Peace Mark Holdings, Ltd.+(1)(2)............. 8,000 0
----------
NON-FERROUS METALS -- 0.4%
OSAKA Titanium Technologies Co............... 4,200 84,241
----------
OFFICE AUTOMATION & EQUIPMENT -- 0.9%
Canon, Inc................................... 5,400 194,946
----------
OIL COMPANIES-EXPLORATION & PRODUCTION -- 1.6%
Inpex Corp................................... 64 339,775
----------
OIL REFINING & MARKETING -- 2.6%
JX Holdings, Inc............................. 99,900 552,643
----------
PHOTO EQUIPMENT & SUPPLIES -- 1.0%
FUJIFILM Holdings Corp....................... 10,620 207,032
----------
RETAIL-CATALOG SHOPPING -- 0.8%
ASKUL Corp................................... 11,700 168,456
----------
RETAIL-CONSUMER ELECTRONICS -- 2.5%
K's Holdings Corp............................ 16,270 519,127
----------
20
SUNAMERICA JAPAN FUND
PORTFOLIO OF INVESTMENTS -- MARCH 31, 2013 -- (UNAUDITED) (CONTINUED)
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
------------------------------------------------------
COMMON STOCK (CONTINUED)
RETAIL-DISCOUNT -- 1.9%
Don Quijote Co., Ltd............... 8,900 $394,065
--------
RUBBER & VINYL -- 0.8%
JSR Corp........................... 8,600 174,593
--------
RUBBER-TIRES -- 1.5%
Bridgestone Corp................... 9,100 306,296
--------
SEMICONDUCTOR EQUIPMENT -- 0.6%
Tokyo Electron, Ltd................ 2,790 123,384
--------
STEEL-PRODUCERS -- 1.9%
Yamato Kogyo Co., Ltd.............. 13,570 397,965
--------
STEEL-SPECIALTY -- 1.4%
Hitachi Metals, Ltd................ 31,500 294,664
--------
TELEPHONE-INTEGRATED -- 4.2%
Nippon Telegraph & Telephone Corp.. 3,240 141,221
Softbank Corp...................... 16,010 737,772
--------
878,993
--------
TELEVISION -- 3.3%
Fuji Media Holdings, Inc........... 238 412,166
TV Asahi Corp...................... 14,600 282,296
--------
694,462
--------
TOBACCO -- 1.9%
Japan Tobacco, Inc................. 12,780 407,093
--------
TRANSPORT-MARINE -- 1.3%
Kawasaki Kisen Kaisha, Ltd.+....... 126,000 266,235
--------
VALUE
SECURITY DESCRIPTION SHARES (NOTE 2)
----------------------------------------------------
TRANSPORT-SERVICES -- 0.8%
Kintetsu World Express, Inc... 4,600 $ 167,774
-----------
TRANSPORT-TRUCK -- 1.0%
Sankyu, Inc................... 23,000 102,081
Seino Holdings Corp........... 11,320 97,839
-----------
199,920
-----------
TRAVEL SERVICES -- 1.6%
HIS Co., Ltd.................. 7,300 331,360
-----------
WATER TREATMENT SYSTEMS -- 0.5%
Kurita Water Industries, Ltd.. 4,700 102,803
-----------
WEB PORTALS/ISP -- 0.9%
Yahoo Japan Corp.............. 391 179,765
-----------
TOTAL INVESTMENTS
(cost $18,679,713)(3)........ 96.4% 20,184,108
Other assets less liabilities... 3.6 744,357
------ -----------
NET ASSETS 100.0% $20,928,465
====== ===========
--------
+ Non-income producing security
(1)Fair valued security. Securities are classified as Level 3 based on the
securities valuation inputs; see Note 2.
(2)Illiquid security. At March 31, 2013, the aggregate value of these
securities was $0 representing 0.0% of net assets.
(3)See Note 6 for cost of investments on a tax basis.
The following is a summary of the inputs used to value the Fund's net assets as
of March 31, 2013 (see Note 2):
LEVEL 1 -- UNADJUSTED LEVEL 2 -- OTHER LEVEL 3 -- SIGNIFICANT
QUOTED PRICES OBSERVABLE INPUTS UNOBSERVABLE INPUTS TOTAL
- --------------------- ----------------- ---------------------- -----------
ASSETS:
Long-Term Investment Securities:
Common Stock:
Auto-Cars/Light Trucks................. $ 1,335,517 $-- $-- $ 1,335,517
Auto/Truck Parts & Equipment-Original.. 2,055,041 -- -- 2,055,041
Miscellaneous Manufacturing............ -- -- 0 0
Other Industries*...................... 16,793,550 -- -- 16,793,550
------------ --- --- -----------
TOTAL..................................... $20,184,108 $-- $ 0 $20,184,108
============ === === ===========
--------
* Sum of all other industries each of which individually has an aggregate
market value of less than 5% of net assets. For a detailed presentation of
securities by industry classification, please refer to the Portfolio of
Investments.
The Fund's policy is to recognize transfers between Levels as of the end of the
reporting period. There were no transfers between Levels during the reporting
period.
At the beginning and end of the reporting period, Level 3 investments in
securities were not considered a material portion of the Fund.
See Notes to Financial Statements
21
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- MARCH 31, 2013 -- (UNAUDITED)
Note 1. Organization
SunAmerica Equity Funds is registered under the Investment Company Act of
1940, as amended (the "1940 Act") as an open-end management investment
company and was organized as a Massachusetts business trust (the "Trust" or
"Equity Funds") on June 16, 1986. It currently consists of three different
funds (each, a "Fund" and collectively, the "Funds"). Each Fund is a
separate series of the Trust with a distinct objective and/or strategy. Each
Fund is advised and/or managed by SunAmerica Asset Management Corp. (the
"Adviser" or "SunAmerica"). An investor may invest in one or more of the
following Funds: SunAmerica International Dividend Strategy Fund
("International Dividend Strategy Fund"), SunAmerica Value Fund ("Value
Fund"), and SunAmerica Japan Fund ("Japan Fund"). The Funds are considered
to be separate entities for financial and tax reporting purposes.
The investment objective and principal investment techniques for each of the
Funds are as follows:
INTERNATIONAL DIVIDEND STRATEGY FUND seeks total return by employing a "buy
and hold" strategy to identify approximately 50 to 100 high dividend
yielding equity securities selected annually from the MSCI ACWI ex-U.S.
Index. At least 80% of the Fund's net assets, plus any borrowings for
investment purposes, will be invested in dividend yielding equity securities.
VALUE FUND seeks long-term growth of capital by active trading of equity
securities selected on the basis of a value criteria, issued by companies of
any market capitalization, that offer the potential for long-term growth of
capital.
JAPAN FUND seeks long-term capital appreciation by active trading of
securities of Japanese issuers and other investments that are tied
economically to Japan ("Japanese companies"). Under normal circumstances, at
least 80% of the Fund's net assets, plus any borrowings for investment
purposes, will be invested in Japanese Companies.
Each Fund is organized as a "diversified" fund within the meaning of the
1940 Act.
Each Fund offers multiple classes of shares. The classes within each Fund
are presented in the Statement of Assets and Liabilities. The cost structure
for each class is as follows:
Class A shares are offered at net asset value per share plus an initial
sales charge. Additionally, purchases of Class A shares in amounts
$1,000,000 or more will be purchased at net asset value but will be subject
to a contingent deferred sales charge on redemptions made within two years
of purchase. With respect to Class A shares of the International Dividend
Strategy Fund and Japan Fund, a redemption fee* of 2% will be assessed on
the proceeds of any redemption of shares that were purchased within ninety
(90) calendar days prior to the date of such redemption. An exchange fee* of
2% will be assessed on the amount of any exchange of Class A shares of the
International Dividend Strategy Fund and Japan Fund that were purchased
within ninety (90) calendar days prior to the date of such exchange.
Class B shares are offered without an initial sales charge, although a
declining contingent deferred sales charge may be imposed on redemptions
made within six years of purchase. Class B shares of each Fund convert
automatically to Class A shares approximately eight years after purchase of
such Class B shares and at such time will be subject to the lower
distribution fee applicable to Class A shares.
Class C shares are offered at net asset value per share without an initial
sales charge, although may be subject to a contingent deferred sales charge
on redemptions made within 12 months of purchase.
Class I and Class Z shares are offered at net asset value per share. These
classes are offered exclusively to certain institutions and to participants
in certain employee benefit plans and other programs. Class I shares are
closed to new purchases; however, existing investors may continue to
purchase shares through reinvestments of dividends and capital gains
distributions.
Each class of shares bears the same voting, dividend, liquidation and other
rights and conditions, except as may otherwise be provided in the Trust's
registration statement. Class A, Class B and Class C shares each make
distribution and account maintenance fee payments under the distribution
plans pursuant to Rule 12b-1 under the 1940 Act, except that Class B and
--------
* See Note 13
22
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- MARCH 31, 2013 -- (UNAUDITED)
(CONTINUED)
Class C shares are subject to higher distribution fee rates. Class I shares
and Class Z shares have not adopted 12b-1 plans and make no payments
thereunder, however, Class I shares pay a service fee to the Funds'
distributor for providing administrative and shareholder services.
INDEMNIFICATIONS: Under the Trust's organizational documents, its officers
and trustees are indemnified against certain liabilities arising out of the
performance of their duties to the Trust. In addition, pursuant to
Indemnification Agreements between the Trust and each of the current
trustees who is not an "interested person," as defined in Section 2(a)(19)
of the 1940 Act, of the Trust (collectively, the "Disinterested Trustees"),
the Trust provides the Disinterested Trustees with a limited indemnification
against liabilities arising out of the performance of their duties to the
Trust, whether such liabilities are asserted during or after their service
as trustees. In addition, in the normal course of business the Trust enters
into contracts that contain the obligation to indemnify others. The Trust's
maximum exposure under these arrangements is unknown. Currently, however,
the Trust expects the risk of loss to be remote.
Note 2. Significant Accounting Policies
The preparation of financial statements in accordance with U.S. generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts and disclosures in the
financial statements. Actual results could differ from those estimates and
those differences could be significant. The following is a summary of
significant accounting policies consistently followed by the Trust in the
preparation of its financial statements:
SECURITY VALUATION: In accordance with the authoritative guidance on fair
value measurements and disclosures under accounting principles generally
accepted in the United States of America ("GAAP"), the Funds disclose the
fair value of its investments in a hierarchy that prioritizes the inputs to
valuation techniques used to measure the fair value. In accordance with
GAAP, fair value is defined as the price that the Funds would receive upon
selling an asset or transferring a liability in a timely transaction to an
independent third party in the principal or most advantageous market. GAAP
established a three-tier hierarchy to provide more transparency around the
inputs used to measure fair value and to establish classification of fair
value measurements for disclosure purposes. Inputs refer broadly to the
assumptions that market participants would use in pricing the asset or
liability, including assumptions about risk. Inputs may be observable or
unobservable. Observable inputs are inputs that reflect the assumptions
market participants would use in pricing the asset or liability developed
based on market data obtained from sources independent of the reporting
entity. Unobservable inputs are inputs that reflect the reporting entity's
own assumptions about the assumptions market participants would use in
pricing the asset or liability developed based on the best information
available in the circumstances. The three-tiers are as follows:
Level 1 -- Unadjusted quoted prices in active markets for identical
securities
Level 2 -- Other significant observable inputs (including quoted prices for
similar securities, interest rates, prepayment speeds, credit risk,
referenced indices, quoted prices in inactive markets, adjusted quoted
prices in active markets, adjusted quoted prices on foreign equity
securities that were adjusted in accordance with pricing procedures approved
by the Board of Trustees ("the Board") etc.).
Level 3 -- Significant unobservable inputs (includes inputs that reflect the
Funds' own assumptions about the assumptions market participants would use
in pricing the security, developed based on the best information available
under the circumstances.)
Changes in valuation techniques may result in transfers in or out of an
investment's assigned Level within the hierarchy. The methodology used for
valuing investments are not necessarily an indication of the risk associated
with investing in those investments and the determination of the
significance of a particular input to the fair value measurement in its
entirety requires judgment and consideration of factors specific to each
security.
The availability of observable inputs can vary from security to security and
is affected by a wide variety of factors, including, for example, the type
of security, whether the security is recently issued and not yet established
in the marketplace, the liquidity of markets, and other characteristics
particular to the security. To the extent that valuation is based on models
or inputs that are less observable or unobservable in the market, the
determination of fair value requires more judgment. Accordingly, the degree
of judgment exercised in determining fair value is greatest for instruments
categorized in Level 3.
23
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- MARCH 31, 2013 -- (UNAUDITED)
(CONTINUED)
The summary of inputs used to value the Funds' net assets as of March 31,
2013 are reported on a schedule following the Portfolio of Investments.
Stocks are generally valued based upon closing sales prices reported on
recognized securities exchanges on which the securities are principally
traded and are generally categorized as Level 1. Stocks listed on the NASDAQ
are valued using the NASDAQ Official Closing Price ("NOCP"). Generally, the
NOCP will be the last sale price unless the reported trade for the stock is
outside the range of the bid/ask price. In such cases, the NOCP will be
normalized to the nearer of the bid or ask price. For listed securities
having no sales reported and for unlisted securities, such securities will
be valued based upon the last reported bid price.
As of the close of regular trading on the New York Stock Exchange ("NYSE"),
securities traded primarily on security exchanges outside the United States
are valued at the last sale price on such exchanges on the day of valuation,
or if there is no sale on the day of valuation, at the last-reported bid
price. If a security's price is available from more than one exchange, the
Funds use the exchange that is the primary market for the security. Such
securities are generally categorized as Level 1. However, depending on the
foreign market, closing prices may be up to 15 hours old when they are used
to price the Fund's shares, and the Fund may determine that certain closing
prices do not reflect the fair value of the security. This determination
will be based on review of a number of factors, including developments in
foreign markets, the performance of U.S. securities markets, and the
performance of instruments trading in U.S. markets that represent foreign
securities and baskets of foreign securities. If a Fund determines that
closing prices do not reflect the fair value of the securities, the Fund
will adjust the previous closing prices in accordance with pricing
procedures approved by the Board to reflect what it believes to be the fair
value of the securities as of the close of regular trading on the NYSE. The
Funds may also fair value securities in other situations, for example, when
a particular foreign market is closed but a Fund is open. For foreign equity
securities and foreign equity futures contracts, the Funds use an outside
pricing service to provide it with closing market prices and information
used for adjusting those prices, and when so adjusted, such securities and
futures are generally categorized as Level 2.
On March 29, 2013, the NYSE was closed for Good Friday, however, certain
foreign markets were open. As a result, the Funds' priced securities that
traded on the open foreign markets at the closing price of the applicable
market and the remaining securities were valued at their applicable closing
or fair value prices on March 28, 2013, the last day in the reporting period
that the Funds were open.
Bonds and debentures, other long-term debt securities, and short term debt
securities with maturities in excess of 60 days, are valued at bid prices
obtained for the day of valuation from a bond pricing service, when such
prices are available and are generally categorized as Level 2. The pricing
services may use valuation models or matrix pricing which considers
information with respect to comparable bond and note transactions,
quotations from bond dealers, or by reference to other securities that are
considered comparable in such characteristics as rating, interest rate, and
maturity date, option adjusted spreads models, prepayments projections,
interest rate spreads, and yield curves to determine current value. If a
vendor quote is unavailable, the securities may be priced at the mean of two
independent quotes obtained from brokers.
Short-term securities with 60 days or less to maturity are amortized to
maturity based on their cost to the Fund if acquired within 60 days of
maturity or, if already held by the Fund on the 60th day, are amortized to
maturity based on the value determined on the 61st day, and are generally
categorized as Level 2.
Investments in registered investment companies that do not trade on an
exchange are valued at the end of day net asset value per share. Investments
in registered investment companies that trade on an exchange are valued at
the last sales price or official closing price as of the close of the
customary trading session on the exchange where the security is principally
traded. Registered investment companies are generally categorized as Level 1.
Other securities are valued on the basis of last sale or bid price (if a
last sale price is not available) which is, in the opinion of the Adviser,
the broadest and most representative market, that may be either a securities
exchange or over-the-counter market and are generally categorized as Level 1
or Level 2.
The Board is responsible for the share valuation process and has adopted a
policy and procedures (the "PRC Procedures") for valuing the securities and
other assets held by the Funds, including procedures for the fair valuation
of securities and other assets for which market quotations are not readily
available or are unreliable. The PRC Procedures provide for the
establishment of a
24
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- MARCH 31, 2013 -- (UNAUDITED)
(CONTINUED)
pricing review committee, which is responsible for, among other things,
making certain determinations in connection with the Trust's fair valuation
procedures. Securities for which market quotations are not readily available
or the values of which may be significantly impacted by the occurrence of
developments or significant events are generally categorized as Level 3.
There is no single standard for making fair value determinations, which may
result in prices that vary from those of other funds.
REPURCHASE AGREEMENTS: The Funds, along with other affiliated registered
investment companies, pursuant to procedures adopted by the Board and
applicable guidance from the Securities and Exchange Commission ("SEC"), may
transfer uninvested cash balances into a single joint account, the daily
aggregate balance of which is invested in one or more repurchase agreements
collateralized by U.S. Treasury or federal agency obligations. In a
repurchase agreement, the seller of a security agrees to repurchase the
security at a mutually agreed-upon time and price, which reflects the
effective rate of return for the term of the agreement. For repurchase
agreements and joint repurchase agreements, the Funds' custodian takes
possession of the collateral pledged for investments in such repurchase
agreements ("repo" or collectively "repos"). The underlying collateral is
valued daily on a mark to market basis, plus accrued interest to ensure that
the value, at the time the agreement is entered into, is equal to at least
102% of the repurchase price, including accrued interest. In the event of
default of the obligation to repurchase, the Fund has the right to liquidate
the collateral and apply the proceeds in satisfaction of the obligation. If
the seller defaults and the value of the collateral declines or if
bankruptcy proceedings are commenced with respect to the seller of the
security, realization of the collateral by the Fund may be delayed or
limited.
As of March 31, 2013, the following Funds held an undivided interest in the
joint repurchase agreement with State Street Bank & Trust Co.:
PERCENTAGE PRINCIPAL
FUND OWNERSHIP AMOUNT
---- ---------- ----------
International Dividend Strategy. 0.70% $2,066,000
Value........................... 2.34 6,875,000
As of such date, the repurchase agreement in that joint account and the
collateral thereof were as follows:
State Street Bank & Trust Co., dated March 28, 2013, bearing interest at a
rate of 0.01% per annum, with a principal amount of $293,509,000, a
repurchase price of $293,509,326, and a maturity date of April 1, 2013. The
repurchase agreement is collateralized by the following:
INTEREST MATURITY PRINCIPAL MARKET
TYPE OF COLLATERAL RATE DATE AMOUNT VALUE
------------------ -------- ---------- ------------ ------------
U.S. Treasury Notes. 0.25% 01/31/2014 $ 4,685,000 $ 4,690,655
U.S. Treasury Notes. 0.25 08/15/2015 11,400,000 11,385,750
U.S. Treasury Notes. 0.38 11/15/2015 15,560,000 15,603,319
U.S. Treasury Notes. 0.63 11/30/2017 45,120,000 45,120,000
U.S. Treasury Notes. 1.50 06/30/2016 8,955,000 9,300,708
U.S. Treasury Notes. 1.75 03/31/2014 140,570,000 143,987,116
U.S. Treasury Notes. 2.13 02/29/2016 15,435,000 16,245,338
U.S. Treasury Notes. 2.13 08/15/2021 50,645,000 53,050,638
SECURITIES TRANSACTIONS, INVESTMENT INCOME, EXPENSES, DIVIDENDS AND
DISTRIBUTIONS TO SHAREHOLDERS: Security transactions are recorded on a trade
date basis. Realized gains and losses on the sale of investments are
calculated on the identified cost basis. For financial statement purposes,
the Funds amortize all premiums and accrete all discounts on fixed income
securities.
Interest income is accrued daily from settlement date except when collection
is not expected. Dividend income is recorded on the ex-dividend date except
for certain dividends from foreign securities, which are recorded as soon as
the Trust is informed after the ex-dividend date.
Funds which earn foreign income and capital gains may be subject to foreign
withholding taxes and capital gains taxes at various rates. Under applicable
foreign law, a withholding of tax may be imposed on interest, dividends, and
capital gains from the sale of foreign securities at various rates.
25
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- MARCH 31, 2013 -- (UNAUDITED)
(CONTINUED)
Net investment income, expenses other than class specific expenses, and
realized and unrealized gains and losses are allocated daily to each class
of shares based upon the relative net asset value of outstanding shares of
each class of shares at the beginning of the day (after adjusting for
current capital shares activity of the respective class).
Expenses common to all Funds, not directly related to individual Funds are
allocated among the Funds based upon relative net assets or other
appropriate allocation methods. In all other respects, expenses are charged
to each Fund as incurred on a specific identification basis. Interest earned
on cash balances held at the custodian are shown as custody credits on the
Statement of Operations.
Dividends from net investment income, if any, are normally paid quarterly
for the International Dividend Strategy Fund. All other Funds pay annually.
Capital gain distributions, if any, are paid annually. Each of the Funds
reserves the right to declare and pay dividends less frequently than
disclosed above, provided that the net realized capital gains and net
investment income, if any, are paid at least annually. The Funds record
dividends and distributions to their shareholders on the ex-dividend date.
The amount of dividends and distributions from net investment income and net
realized capital gains are determined and presented in accordance with
federal income tax regulations, which may differ from U.S. generally
accepted accounting principles. These "book/tax" differences are either
considered temporary or permanent in nature. To the extent these differences
are permanent in nature, such amounts are reclassified within the capital
accounts at fiscal year end based on their federal tax-basis treatment;
temporary differences do not require reclassification. Net assets are not
affected by these reclassifications.
Each Fund is considered a separate entity for tax purposes and intends to
comply with the requirements of the Internal Revenue Code, as amended,
applicable to regulated investment companies and distribute all of its
taxable income, including any net capital gains on investments, to its
shareholders. Each Fund also intends to distribute sufficient net investment
income and net capital gains, if any, so that each Fund will not be subject
to excise tax on undistributed income and gains. Therefore, no federal
income tax or excise tax provision is required.
Each Fund recognizes the tax benefits of uncertain tax positions only when
the position is more likely than not to be sustained, assuming examination
by tax authorities. Management has analyzed each Fund's tax positions and
concluded that no liability for unrecognized tax benefits should be recorded
related to uncertain tax positions taken on returns filed for open tax years
2009 - 2011 or expected to be taken in each Fund's 2012 tax return. The
Funds are not aware of any tax provisions for which it is reasonably
possible that the total amounts of unrecognized tax benefits will change
materially in the next twelve months. The Funds file U.S. federal and
certain state income tax returns. With few exceptions, the Funds are no
longer subject to U.S. federal and state tax examinations by tax authorities
for tax returns ending before 2009.
FOREIGN CURRENCY TRANSLATION: The books and records of the Funds are
maintained in U.S. dollars. Assets and liabilities denominated in foreign
currencies and commitments under forward foreign currency contracts are
translated into U.S. dollars based on the exchange rate of such currencies
against U.S. dollars on the date of valuation.
The Funds do not isolate that portion of the results of operations arising
as a result of changes in the foreign exchange rates from the changes in the
market prices of securities held at the end of the year.
Similarly, the Funds do not isolate the effect of changes in foreign
exchange rates from the changes in the market prices of portfolio securities
sold during the period.
Realized foreign exchange gains and losses on other assets and liabilities
and change in unrealized foreign exchange gains and losses on other assets
and liabilities located in the Statement of Operations include realized
foreign exchange gains and losses from currency gains or losses between the
trade and the settlement dates of securities transactions, the difference
between the amounts of interest, dividends and foreign withholding taxes
recorded on the Funds' books and the U.S. dollar equivalent amounts actually
received or paid and changes in the unrealized foreign exchange gains and
losses relating to the other assets and liabilities arising as a result of
changes in the exchange rates and realized gains and losses on forward
foreign currency contracts.
26
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- MARCH 31, 2013 -- (UNAUDITED)
(CONTINUED)
NEW ACCOUNTING PRONOUNCEMENTS
In May 2011 the FASB issued Accounting Standards Update ("ASU") No. 2011-11
"Disclosures about Offsetting Assets and Liabilities which was subsequently
clarified in FASB ASU 2013-01 "Clarifying the Scope of Disclosures about
Offsetting Assets and Liabilities" which was issued January 2013. The
amended Standard 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
new and revised disclosures are effective for annual reporting periods
beginning on or after January 1, 2013, and interim periods within those
annual periods. At this time, management is evaluating the implications of
ASU 2013-01 and its impact on the financial statements.
Note 3. Investment Advisory and Management Agreement, Distribution Agreement
and Service Agreement
The Trust, on behalf of each Fund, has an Investment Advisory and Management
Agreement (the "Agreement") with SunAmerica. Under the Agreement, SunAmerica
provides continuous supervision of a Fund's portfolio and administers its
corporate affairs, subject to general review by the Trustees. In connection
therewith, SunAmerica furnishes the Funds with office facilities, maintains
certain of the Funds' books and records, and pays the salaries and expenses
of all personnel, including officers of the Funds who are employees of
SunAmerica and its affiliates.
The Funds pay SunAmerica a monthly investment advisory and management fee
calculated daily at the following annual percentages of each Fund's average
daily net assets:
MANAGEMENT
FUND FEES
---- ----------
International Dividend Strategy Fund+. 1.00%
Value Fund............................ 0.75
Japan Fund............................ 1.15
For the six months ended March 31, 2013, SunAmerica earned fees in the
amounts stated in the Statement of Operations.
The Japan Fund is subadvised by Wellington Management Company, LLP
("Wellington Management") pursuant to a subadvisory agreement with
SunAmerica. Wellington Management receives an annual fee of 0.45% of average
daily net assets of the Japan Fund, which is paid by SunAmerica. In
addition, Wellington Management has agreed to voluntarily waive 50% or
0.225% of the subadvisory fee payable to it by SunAmerica. The voluntary fee
waiver may be discontinued at any time by Wellington Management.
SunAmerica has contractually agreed to waive fees or reimburse expenses to
the extent necessary to cap the Funds' annual fund operating expenses at the
following percentages of each Class's average daily net assets. For the
purposes of waived fee and/or reimbursed expense calculations, annual fund
operating expenses shall not include extraordinary expenses, as determined
under generally accepted accounting principals, or acquired fund fees and
expenses. The contractual fee waivers and expense reimbursements will
continue in effect indefinitely unless terminated by the Trustees, including
a majority of the Disinterested Trustees.
--------
+ Pursuant to a Fee Waiver Agreement, SunAmerica is contractually obligated to
waive its advisory fee so that the aggregate advisory fee payable by the
Fund to SunAmerica does not exceed an annual rate of 0.95% of average daily
net assets. For the six months ended March 31, 2013, the amount of the
advisory fees waived were $20,170. These amounts are reflected in the
Statement of Operations.
27
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- MARCH 31, 2013 -- (UNAUDITED)
(CONTINUED)
FUND PERCENTAGE
---- ----------
International Dividend Strategy Fund Class A. 1.90%
International Dividend Strategy Fund Class B. 2.55
International Dividend Strategy Fund Class C. 2.55
International Dividend Strategy Fund Class I. 1.80
Value Fund Class A........................... 1.63
Value Fund Class B........................... 2.28
Value Fund Class C........................... 2.28
Value Fund Class Z........................... 1.06
Japan Fund Class A........................... 1.90
Japan Fund Class B........................... 2.55
Japan Fund Class C........................... 2.55
Any contractual waivers and/or reimbursements made by SunAmerica are subject
to recoupment from the Funds within two years after the occurrence of the
waiver and/or reimbursement, provided that the Funds are able to effect such
payments to SunAmerica and remain in compliance with the expense limitations
in effect at the time the waivers and/or reimbursements were made.
For the six months ended March 31, 2013, pursuant to the contractual expense
limitations referred to above, SunAmerica has waived or reimbursed expenses
as follows:
OTHER EXPENSES
FUND REIMBURSED
---- --------------
Japan Fund. $33,433
FUND AMOUNT
---- -------
International Dividend Strategy Fund Class A. $48,564
International Dividend Strategy Fund Class B. 13,449
International Dividend Strategy Fund Class C. 16,519
International Dividend Strategy Fund Class I. 469
Value Fund Class B........................... 7,462
Value Fund Class C........................... 1,405
Japan Fund Class A........................... 27,682
Japan Fund Class B........................... 3,954
Japan Fund Class C........................... 4,274
For the six months ended March 31, 2013, the amounts recouped by SunAmerica
are as follows:
FUND AMOUNT
---- ------
International Dividend Strategy Fund Class I. $ 24
Value Fund Class C........................... 338
At March 31, 2013, expenses previously waived and/or reimbursed by
SunAmerica that remain subject to recoupment and expire during the time
periods indicated are as follows:
OTHER EXPENSES REIMBURSED
-------------------------------------
SEPTEMBER 30, SEPTEMBER 30, MARCH 31,
FUND 2013 2014 2015
---- ------------- ------------- ---------
International Dividend Strategy Fund. $ -- $129,712 $ --
Japan Fund........................... 43,421 131,442 33,433
28
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- MARCH 31, 2013 -- (UNAUDITED)
(CONTINUED)
CLASS SPECIFIC EXPENSES REIMBURSED
-------------------------------------
SEPTEMBER 30, SEPTEMBER 30, MARCH 31,
FUND 2013 2014 2015
---- ------------- ------------- ---------
International Dividend Strategy Fund Class A. $ -- $26,974 $48,564
International Dividend Strategy Fund Class B. 4,289 16,021 13,449
International Dividend Strategy Fund Class C. 2,850 18,097 16,519
International Dividend Strategy Fund Class I. -- 65 469
Value Fund Class B........................... 73 9,064 7,462
Value Fund Class C........................... -- -- 1,067
Japan Fund Class A........................... 8,952 17,985 27,683
Japan Fund Class B........................... 7,252 15,081 3,953
Japan Fund Class C........................... 7,224 15,134 4,275
The Trust, on behalf of each Fund, has entered into a Distribution Agreement
with SunAmerica Capital Services, Inc. ("SACS" or the "Distributor"), an
affiliate of the Adviser. Each Fund has adopted a Distribution Plan on
behalf of each class of shares (other than Class I and Class Z shares) (each
a "Plan" and collectively, the "Plans") in accordance with the provisions of
Rule 12b-1 under the 1940 Act, hereinafter referred to as the "Class A
Plan," "Class B Plan" and "Class C Plan." In adopting the Plans, the
Trustees determined that there was a reasonable likelihood that each such
Plan would benefit the Fund and the shareholders of the respective class.
The sales charge and distribution fees of a particular class will not be
used to subsidize the sale of shares of any other class.
Under the Class A Plan, Class B Plan and Class C Plan, the Distributor
receives a distribution fee from a Fund at an annual rate of 0.10%, 0.75%
and 0.75%, respectively, of the average daily net assets of the Fund's
Class A, Class B and Class C shares to compensate the Distributor and
certain securities firms for providing sales and promotional activities for
distributing that class of shares. The distribution costs for which the
Distributor may be compensated include fees paid to broker-dealers that have
sold Fund shares, commissions and other expenses such as those incurred for
sales literature, prospectus printing and distribution and compensation to
wholesalers. It is possible that in any given year the amount paid to the
Distributor under each Class' Plan may exceed the Distributor's distribution
costs as described above. The Plans provide that the Class A, Class B and
Class C shares of each Fund will pay the Distributor an account maintenance
fee up to an annual rate of 0.25% of the aggregate average daily net assets
of such class of shares for payments to compensate the Distributor and
certain securities firms for account maintenance activities. Accordingly,
for the six months ended March 31, 2013, SACS received fees (see Statement
of Operations) based upon the aforementioned rates.
In addition, SACS is paid a fee of 0.25% of average daily net assets of
Class I shares in connection with providing administrative and shareholder
services to Class I shareholders. For the six months ended March 31, 2013,
SACS earned fees (see Statement of Operations) based upon the aforementioned
rates.
SACS receives sales charges on each Fund's Class A shares, portions of which
are reallocated to affiliated broker-dealers and non-affiliated
broker-dealers. SACS also receives the proceeds of contingent deferred sales
charges paid by investors in connection with certain redemptions of each
Fund's Class A, Class B and Class C shares. SACS has advised the Funds that
for the six months ended March 31, 2013, the proceeds received from sales
(and paid out to affiliated and non-affiliated broker-dealers) and
redemptions are as follows:
CLASS A CLASS B CLASS C
--------------------------------------------- ---------- ----------
CONTINGENT CONTINGENT CONTINGENT
AFFILIATED DEFERRED DEFERRED DEFERRED
SALES BROKER- NON-AFFILIATED SALES SALES SALES
FUND CHARGES DEALERS BROKER-DEALERS CHARGES CHARGES CHARGES
---- -------- ---------- -------------- ---------- ---------- ----------
International Dividend Strategy Fund. $137,872 $16,160 $99,948 $62 $2,495 $1,370
Value Fund........................... 23,572 7,213 12,676 48 3,708 585
Japan Fund........................... 3,017 938 1,611 -- 267 50
29
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- MARCH 31, 2013 -- (UNAUDITED)
(CONTINUED)
The Trust has entered into a Service Agreement with SunAmerica Fund
Services, Inc. ("SAFS"), an affiliate of the Adviser. Under the Service
Agreement, SAFS performs certain shareholder account functions by assisting
the Funds' transfer agent, State Street Bank and Trust Company, in
connection with the services that it offers to the shareholders of the
Funds. Pursuant to the Service Agreement, the Funds (except for Class Z
shares of the Funds) pay a fee to SAFS for services rendered based upon an
annual rate of 0.22% of average daily net assets. No portion of this fee is
paid or reimbursed by the Class Z shares, however, Class Z shares pay all
direct transfer agency fees and out-of-pocket expenses relating to Class Z
shares. For the six months ended March 31, 2013, the Funds incurred the
following expenses which are included in transfer agent fees payable in the
Statement of Asset and Liabilities and in transfer agent fees and expenses
in the Statement of Operations to compensate SAFS pursuant to the terms of
the Service Agreement.
EXPENSE PAYABLE AT MARCH 31, 2013
------------------------------- -------------------------------
FUND CLASS A CLASS B CLASS C CLASS I CLASS A CLASS B CLASS C CLASS I
---- ------- ------- ------- ------- ------- ------- ------- -------
International Dividend Strategy Fund. $65,025 $5,444 $16,882 $1,397 $13,756 $994 $3,560 $235
Value Fund........................... 98,606 5,530 16,299 -- 17,527 932 2,826 --
Japan Fund........................... 21,510 209 479 -- 3,723 36 93 --
At March 31, 2013, the following affiliates owned a percentage of the
outstanding shares of the following funds: Focused Multi-Asset Strategy
Portfolio and Focused Balanced Strategy Portfolio owned 16% and 8%,
respectively of the SunAmerica International Dividend Strategy Fund; Focused
Multi-Asset Strategy Portfolio and Focused Balanced Strategy Portfolio owned
16% and 15%, respectively, of SunAmerica Value Fund; and Focused Multi-Asset
Strategy Portfolio owned 88% of the Japan Fund.
Note 4. Expense Reductions
Through expense offset arrangements resulting from broker commission
recapture, a portion of the expenses of the Funds set forth below have been
reduced. For the six months ended March 31, 2012, the amount of expense
reductions received by each Fund used to offset the Fund's non-affiliated
expenses were as follows:
TOTAL EXPENSE
REDUCTIONS
-------------
Value Fund. $9,625
Note 5. Purchases and Sales of Securities
The cost of purchases and proceeds from sales and maturities of long-term
investments during the six months ended March 31, 2013 were as follows:
INTERNATIONAL
DIVIDEND
STRATEGY
FUND VALUE FUND JAPAN FUND
------------- ------------ -----------
Purchases (excluding U.S. government securities)... $36,089,878 $100,148,360 $11,643,229
Sales (excluding U.S. government securities)....... 8,825,994 107,095,458 15,057,872
Purchase of U.S. government securities............. -- -- --
Sales and maturities of U.S. government securities. -- -- --
Note 6. Federal Income Taxes
The following details the tax basis of distributions as well as the
components of distributable earnings. The tax basis components of
distributable earnings differ from the amounts reflected in the Statement of
Assets and Liabilities by temporary book/tax differences primarily arising
from wash sales, post October losses, investments in passive foreign
investment companies, and derivative transactions.
30
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- MARCH 31, 2013 -- (UNAUDITED)
(CONTINUED)
FOR THE YEAR ENDED SEPTEMBER 30, 2012
---------------------------------------------------------------
DISTRIBUTABLE EARNINGS TAX DISTRIBUTIONS
---------------------------------------- ---------------------
LONG-TERM GAINS/ UNREALIZED LONG-TERM
ORDINARY CAPITAL LOSS APPRECIATION ORDINARY CAPITAL
INCOME CARRYOVER (DEPRECIATION)* INCOME GAINS
-------- ---------------- --------------- ---------- ----------
International Dividend Strategy Fund. $269,339 $(92,699,294) $ 57,772 $1,506,579 $ --
Value Fund........................... 547,426 (78,839,105) 4,818,646 1,018,253 --
Japan Fund........................... 480,814 (168,220) (1,171,183) 47,904 4,711,389
--------
* Unrealized appreciation (depreciation) includes amounts for other assets and
liabilities denominated in foreign currency.
The amounts of aggregate unrealized gain (loss) and the cost of investment
securities for federal income tax purposes, including short-term securities
and repurchase agreements, were as follows at March 31, 2013:
INTERNATIONAL
DIVIDEND
STRATEGY VALUE JAPAN
FUND FUND FUND
------------- ------------ -----------
Cost (tax basis)........................... $96,912,266 $109,858,246 $18,710,811
=========== ============ ===========
Appreciation............................... 8,517,275 12,148,694 1,894,848
Depreciation............................... (8,176,063) (3,587,540) (421,551)
----------- ------------ -----------
Net unrealized appreciation (depreciation). $ 341,212 $ 8,561,154 $ 1,473,297
=========== ============ ===========
For Federal income tax purposes, the Funds indicated below have capital loss
carryforwards, which expire in the year indicated, as of September 30, 2012,
which are available to offset future capital gains, if any:
CAPITAL LOSS CARRYFORWARD+ UNLIMITED
----------------------------------------------- ------------
FUND 2015 2016 2017 2018 ST LT
---- ----------- ----------- ----------- ----------- -------- ---
International Dividend Strategy Fund*. $31,528,888 $25,210,425 $16,578,456 $19,381,525 $ -- $--
Value Fund*........................... -- 21,181,582 36,272,125 21,385,398 -- --
Japan Fund............................ -- -- -- -- 168,220 --
--------
+ On December 22, 2010, the Regulated Investment Company Modernization Act of
2010 (the "Act") was enacted, which changed various technical rules
governing the tax treatment of regulated investment companies. The changes
are generally effective for taxable years beginning after the date of
enactment. Under the Act, the Funds will be permitted to carry forward
capital losses incurred in taxable years beginning after the date of
enactment for an unlimited period. However, any losses incurred during those
future taxable years will be required to be utilized prior to the losses
incurred in pre-enactment taxable years, which carry an expiration date. As
a result of this ordering rule, pre-enactment capital loss carryforwards may
be more likely to expire unused. Additionally, post-enactment capital losses
that are carried forward will retain their character as either short-term or
long-term losses rather than being considered all short-term as under
previous law.
* The capital loss carryforwards include realized capital losses from the
acquisition of other funds. Certain losses may be subject to annual
limitations imposed by the Internal Revenue Code. Therefore, it is possible
that not all of the capital losses will be available for use. As of
September 30, 2012, based on current tax law, the International Dividend
Strategy Fund and the Value Fund have $0 and $19,837,903, respectively, of
capital losses that will not be available for use.
Note 7. Capital Share Transactions
Transactions in capital shares of each class of each Fund were as follows:
INTERNATIONAL DIVIDEND STRATEGY FUND
--------------------------------------------------------------------------------------------
CLASS A CLASS B
------------------------------------------------ ------------------------------------------
FOR THE FOR THE
SIX MONTHS ENDED FOR THE SIX MONTHS ENDED FOR THE
MARCH 31, 2013 YEAR ENDED MARCH 31, 2013 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 2012 (UNAUDITED) SEPTEMBER 30, 2012
---------------------- ------------------------ ------------------- ---------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
--------- ----------- ---------- ------------ ------- ---------- -------- -----------
Shares sold(1)(2)........... 2,582,509 $29,534,767 1,019,549 $ 11,094,004 114,861 $1,194,173 86,088 $ 870,181
Reinvested dividends........ 71,193 781,702 112,965 1,177,713 6,489 65,537 6,312 60,708
Shares redeemed(1)(2)(3)(4). (764,562) (8,498,580) (1,308,627) (14,378,854) (61,597) (627,116) (181,208) (1,830,341)
--------- ----------- ---------- ------------ ------- ---------- -------- -----------
Net increase (decrease)..... 1,889,140 $21,817,889 (176,113) $ (2,107,137) 59,753 $ 632,594 (88,808) $ (899,452)
========= =========== ========== ============ ======= ========== ======== ===========
31
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- MARCH 31, 2013 -- (UNAUDITED)
(CONTINUED)
INTERNATIONAL DIVIDEND STRATEGY FUND
------------------------------------------------------------------------------------
CLASS C CLASS I
-------------------------------------------- --------------------------------------
FOR THE FOR THE FOR THE
SIX MONTHS ENDED FOR THE SIX MONTHS ENDED YEAR ENDED
MARCH 31, 2013 YEAR ENDED MARCH 31, 2013 SEPTEMBER 30,
(UNAUDITED) SEPTEMBER 30, 2012 (UNAUDITED) 2012
--------------------- --------------------- ------------------ ------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
-------- ----------- -------- ----------- ------- --------- ------- ---------
Shares sold............. 791,268 $ 8,220,821 185,050 $ 1,865,186 -- $ -- -- $ --
Reinvested dividends.... 19,508 196,841 15,621 150,588 1,922 21,274 3,185 33,449
Shares redeemed(3)(4)... (157,058) (1,604,127) (348,129) (3,492,494) (10,559) (118,526) (42,711) (466,822)
-------- ----------- -------- ----------- ------- --------- ------- ---------
Net increase (decrease). 653,718 $ 6,813,535 (147,458) $(1,476,720) (8,637) $ (97,252) (39,526) $(433,373)
======== =========== ======== =========== ======= ========= ======= =========
--------
(1)For the six months ended March 31, 2013, includes automatic conversion of
23,500 shares of Class B shares in the amount of $240,946 to 21,612 shares
of Class A shares in the amount of $240,946.
(2)For the year ended September 30, 2012, includes automatic conversion of
79,774 shares of Class B shares in the amount of $804,583 to 73,386 shares
of Class A shares in the amount of $804,583.
(3)For the six months ended March 31, 2013, net of redemption fees* of $4,341,
$382, $1,139 and $101 for Class A, Class B, Class C and Class I shares,
respectively.
(4)For the year ended September 30, 2012, net of redemption fees* of $1,248,
$119, $308 and $33 for Class A, Class B, Class C and Class I shares,
respectively.
* See Note 13
VALUE FUND
---------------------------------------------------------------------------------------------
CLASS A CLASS B
------------------------------------------------ -------------------------------------------
FOR THE FOR THE
SIX MONTHS ENDED FOR THE SIX MONTHS ENDED FOR THE
MARCH 31, 2013 YEAR ENDED MARCH 31, 2013 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 2012 (UNAUDITED) SEPTEMBER 30, 2012
---------------------- ------------------------ -------------------- ---------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
-------- ------------ ---------- ------------ ------- ----------- -------- -----------
Shares sold(1)(2)....... 364,737 $ 5,067,517 2,524,070 $ 30,914,234 17,685 $ 229,851 44,100 $ 499,807
Reinvested dividends.... 53,495 705,602 74,831 840,354 338 4,187 2,340 24,642
Shares redeemed(1)(2)... (773,296) (10,539,218) (4,811,741) (57,374,168) (81,321) (1,038,469) (307,988) (3,539,177)
-------- ------------ ---------- ------------ ------- ----------- -------- -----------
Net increase (decrease). (355,064) $ (4,766,099) (2,212,840) $(25,619,580) (63,298) $ (804,431) (261,548) $(3,014,728)
======== ============ ========== ============ ======= =========== ======== ===========
VALUE FUND
---------------------------------------------------------------------------------------------
CLASS C CLASS Z
------------------------------------------------ -------------------------------------------
FOR THE FOR THE
SIX MONTHS ENDED FOR THE SIX MONTHS ENDED FOR THE
MARCH 31, 2013 YEAR ENDED MARCH 31, 2013 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 2012 (UNAUDITED) SEPTEMBER 30, 2012
---------------------- ------------------------ -------------------- ---------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
-------- ------------ ---------- ------------ ------- ----------- -------- -----------
Shares sold............. 54,220 $ 681,394 21,595 $ 246,087 -- $ -- -- $ --
Reinvested dividends.... 2,279 28,121 6,436 67,705 144 1,988 288 3,390
Shares redeemed......... (128,327) (1,642,481) (365,452) (4,173,442) (6,539) (94,464) (4,890) (62,156)
-------- ------------ ---------- ------------ ------- ----------- -------- -----------
Net increase (decrease). (71,828) $ (932,966) (337,421) $ (3,859,650) (6,395) $ (92,476) (4,602) $ (58,766)
======== ============ ========== ============ ======= =========== ======== ===========
--------
(1)For the six months ended March 31, 2013, includes automatic conversion of
29,897 shares of Class B shares in the amount of $382,592 to 27,977 shares
of Class A shares in the amount of $382,592.
(2)For the year ended September 30, 2012, includes automatic conversion of
168,077 shares of Class B shares in the amount of $1,938,494 to 157,217
shares of Class A shares in the amount of $1,938,494.
32
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- MARCH 31, 2013 -- (UNAUDITED)
(CONTINUED)
JAPAN FUND
-------------------------------------------------------------------------------------
CLASS A CLASS B
----------------------------------------------- ------------------------------------
FOR THE FOR THE
SIX MONTHS ENDED FOR THE SIX MONTHS ENDED FOR THE
MARCH 31, 2013 YEAR ENDED MARCH 31, 2013 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 2012 (UNAUDITED) SEPTEMBER 30, 2012
--------------------- ------------------------ ---------------- ------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
-------- ----------- ---------- ------------ ------ -------- ------- ---------
Shares sold(1)(2)........... 195,388 $ 1,315,587 262,298 $ 1,634,936 1,465 $ 9,237 4,006 $ 25,910
Reinvested dividends........ 73,705 468,763 724,542 4,513,895 496 3,078 9,104 55,170
Shares redeemed(1)(2)(3)(4). (678,374) (4,443,218) (1,806,599) (13,332,511) (4,723) (29,573) (23,141) (151,723)
-------- ----------- ---------- ------------ ------ -------- ------- ---------
Net increase (decrease)..... (409,281) $(2,658,868) (819,759) $ (7,183,680) (2,762) $(17,258) (10,031) $ (70,643)
======== =========== ========== ============ ====== ======== ======= =========
JAPAN FUND
-----------------------------------------------
CLASS C
-----------------------------------------------
FOR THE
SIX MONTHS ENDED FOR THE
MARCH 31, 2013 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 2012
--------------------- ------------------------
SHARES AMOUNT SHARES AMOUNT
-------- ----------- ---------- ------------
Shares sold................. 30,958 $ 209,390 10,819 $ 74,500
Reinvested dividends........ 1,039 6,443 24,675 149,530
Shares redeemed(3)(4)....... (13,119) (83,074) (82,544) (542,395)
-------- ----------- ---------- ------------
Net increase (decrease)..... 18,878 $ 132,759 (47,050) $ (318,365)
======== =========== ========== ============
--------
(1)For the six months ended March 31, 2013, includes automatic conversion of
778 shares of Class B shares in the amount of $4,918 to 754 shares of
Class A shares in the amount of $4,918.
(2)For the year ended September 30, 2012, includes automatic conversion of
2,148 shares of Class B shares in the amount of $14,704 to 2,090 shares of
Class A shares in the amount of $14,704.
(3)For the six months ended March 31, 2013, net of redemption fees* of $1,971,
$19, and $43 for Class A, Class B, and Class C shares, respectively.
(4)For the year ended September 30, 2012, net of redemption fees* of $272, $3,
and $8 for Class A, Class B, and Class C shares, respectively.
* See Note 13
Note 8. Line of Credit
The SunAmerica family of mutual funds has established a $75 million
committed and a $50 million uncommitted line of credit with State Street
Bank and Trust Company, the Funds' custodian. Interest is currently payable
at the higher of the Federal Funds Rate plus 125 basis points or the
overnight London Interbank Offered Rate plus 125 basis points on the
committed line and State Street Bank and Trust Company's discretionary bid
rate on the uncommitted line of credit. There is also a commitment fee of 10
basis points per annum on the daily unused portion of the committed line of
credit which is included in other expenses on the Statement of Operations.
Borrowings under the line of credit will commence when the respective Fund's
cash shortfall exceeds $100,000. For the six months ended March 31, 2013,
the following Funds had borrowings:
AVERAGE WEIGHTED
DAYS INTEREST DEBT AVERAGE
FUND OUTSTANDING CHARGES UTILIZED INTEREST
---- ----------- -------- -------- --------
Japan Fund. 22 $134 $153,464 1.43%
At March 31, 2013, there were no borrowings outstanding.
Note 9. Interfund Lending Agreement
Pursuant to the exemptive relief granted by the Securities and Exchange
Commission, the Funds are permitted to participate in an interfund lending
program among investment companies advised by SunAmerica or an affiliate.
The interfund lending program allows the participating Funds to borrow money
from and lend money to each other for temporary or emergency purposes. An
interfund loan will be made under this facility only if the participating
Funds receive a more favorable interest rate than would otherwise be
available from a typical bank for a comparable transaction. For the six
months ended March 31, 2013, none of the Funds participated in this program.
33
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- MARCH 31, 2013 -- (UNAUDITED)
(CONTINUED)
Note 10. Trustees' Retirement Plan
The Board has adopted the SunAmerica Disinterested Trustees' and Directors'
Retirement Plan (the "Retirement Plan") effective January 1, 1993, as
amended, for the Disinterested Trustees. The Retirement Plan provides
generally that a Disinterested Trustee may become a participant
("Participant") in the Retirement Plan if he or she has at least 10 years of
consecutive service as a Disinterested Trustee of any of the adopting
SunAmerica mutual funds (the "Adopting Funds") or has attained the age of 60
while a Trustee and completed five (5) consecutive years of service as a
Trustee of any Adopting Fund (an "Eligible Trustee/Director"). Pursuant to
the Retirement Plan, an Eligible Trustee may receive benefits upon (i) his
or her death or disability while a Trustee or (ii) the termination of his or
her tenure as a Trustee, other than removal for cause from each of the
Adopting Funds with respect to which he or she is an Eligible Trustee.
As of each of the first 10 birthdays after becoming a Participant and on
which he or she is both a Trustee and Participant, each Eligible Trustee
will be credited with an amount equal to 50% of his or her regular fees
(excluding committee fees) for services as a Disinterested Trustee of each
Adopting Fund for the calendar year in which such birthday occurs. In
addition, an amount equal to 8.50% of any amounts credited under the
preceding statement during prior years is added to each Eligible Trustee's
account. The rights of any Participant to benefits under the Retirement Plan
shall be an unsecured claim against the assets of the Adopting Funds. An
Eligible Trustee may receive any benefits payable under the Retirement Plan,
at his or her election, either in one lump sum or in up to 15 annual
installments. Any undistributed amounts shall continue to accrue interest at
8.50%.
Effective December 3, 2008, the Retirement Plan was amended to, among other
things, (1) freeze the Retirement Plan as to future accruals for active
Participants as of December 31, 2008, (2) prohibit Disinterested Trustees
from first becoming participants in the Retirement Plan after December 31,
2008 and (3) permit active Participants to elect to receive a distribution
of their entire Retirement Plan account balance in 2009. The freeze on
future accruals does not apply to Participants that have commenced receiving
benefits under the Retirement Plan on or before December 31, 2008.
The following amounts for the Retirement Plan Liabilities are included in
the Trustees' fees and expenses payable line on the Statement of Assets and
Liabilities and the amounts for the Retirement Plan Expenses are included in
the Trustees' fees and expenses line on the Statement of Operations.
RETIREMENT PLAN RETIREMENT PLAN RETIREMENT PLAN
LIABILITY EXPENSE PAYMENTS
--------------- --------------- ---------------
FUND AS OF MARCH 31, 2013
---- -----------------------------------------------
International Dividend Strategy Fund. $1,732 $32 $457
Value Fund........................... 3,091 48 821
Note 11. Investment Concentration
Some of the Funds may invest internationally, including in "emerging market"
countries. Emerging market securities involve risks not typically associated
with investing in securities of issuers in more developed markets. The
markets of emerging market countries are typically more volatile and
potentially less liquid than more developed markets. Emerging market
countries may have relatively unstable government and may present the risk
of nationalization of businesses, expropriation, confiscatory taxation or,
in certain instances, reversion to closed market, centrally planned
economies. These securities may be denominated in currencies other than U.S.
dollars. When investing internationally, the value of the investment may be
affected by fluctuating currency values, changing local and regional
economic, political and social conditions, and greater market volatility. In
addition, because the Japan Fund concentrates its investments in Japan, the
Fund's performance is expected to be closely tied to social, political and
economic conditions of that country. At March 31, 2013, the International
Dividend Strategy Fund had 16.3% of its net assets invested in equity
securities domiciled in Brazil, while the Japan Fund had 96.4% of its net
assets invested in equity securities domiciled Japan.
34
SUNAMERICA EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS -- MARCH 31, 2013 -- (UNAUDITED)
(CONTINUED)
Note 12. Other Matters
On December 13, 2012, the International Dividend Strategy Fund paid a
distribution to shareholders in the aggregate amount of $1,187,375. It has
been subsequently determined that $134,616 (11.3%) is estimated to be a
return of capital and, accordingly, this updated information is being
provided pursuant to Rule 19a-1(e) of the 1940 Act. This updated information
does not reflect the tax character of the distribution and should not be
used for tax reporting purposes.
Note 13. Subsequent Event
The Board of Trustees of the Trust approved the termination of the 2.00%
redemption and exchange fees applicable to the Class A shares of the Funds,
effective May 1, 2013. Accordingly, the Funds will no longer assess a
redemption or exchange fee on redemptions or exchanges of shares that occur
on or after May 1, 2013.
35
[LOGO]
HARBORSIDE FINANCIAL CENTER
3200 PLAZA 5
JERSEY CITY, NJ 07311-4992
TRUSTEES SHAREHOLDER SERVICING This report is submitted
Richard W. Grant AGENT solely for the general
Peter A. Harbeck SunAmerica Fund information of
Dr. Judith L. Craven Services, Inc. shareholders of the
William F. Devin Harborside Financial Funds. Distribution of
Stephen J. Gutman Center this report to persons
William J. Shea 3200 Plaza 5 other than shareholders
Jersey City, NJ of the Funds is
OFFICERS 07311-4992 authorized only in
John T. Genoy, President con-nection with a
and Chief Executive CUSTODIAN AND TRANSFER currently effective
Officer AGENT pro-spectus, setting
Donna M. Handel, State Street Bank and forth details of the
Treasurer Trust Company Funds, which must precede
Timothy P. Pettee, Vice P.O. Box 5607 or accom-pany this report.
President Boston, MA 02110
James Nichols, Vice DELIVERY OF SHAREHOLDER
President VOTING PROXIES ON TRUST DOCUMENTS
Katherine Stoner, Vice PORTFOLIO SECURITIES The Funds have adopted a
President and Chief A description of the policy that allows them
Compliance Officer policies and procedures to send only one copy of
Gregory N. Bressler, that the Trust uses to a Fund's prospectus,
Chief Legal Officer determine how to vote proxy material, annual
and Secretary proxies relating to report and semi-annual
Gregory R. Kingston, securities held in a report (the "shareholder
Vice President and Fund's portfolio which is documents") to
Assistant Treasurer available in the Trust's shareholders with
Kathleen Fuentes, Statement of Additional multiple accounts
Assistant Secretary Information, may be residing at the same
John E. McLean, obtained without charge "household." This
Assistant Secretary upon request, by calling practice is called
Nori L. Gabert, Vice (800) 858-8850. This householding and reduces
President and in-formation is also Fund expenses, which
Assistant Secretary available from the EDGAR benefits you and other
Matthew Hackethal, database on the U.S. shareholders. Unless the
Anti-Money Laundering Securities and Ex-change Funds receive
Compliance Officer Commission's website at instructions to the
Diedre L. Shepherd, http://www.sec.gov. con-trary, you will only
Assistant Treasurer receive one copy of the
PROXY VOTING RECORD ON shareholder documents.
INVESTMENT ADVISER SUNAMERICA EQUITY FUNDS The Funds will continue
SunAmerica Asset Information regarding how to household the
Management Corp. SunAmerica Equity Funds share-holder documents
Harborside Financial voted proxies relating to indefinitely, until we
Center securities held in are instructed otherwise.
3200 Plaza 5 SunAmerica Equity Funds If you do not wish to
Jersey City, NJ during the most recent participate in
07311-4992 twelve month period ended householding, please
June 30 is available, contact Shareholder
DISTRIBUTOR once filed with the U.S. Services at (800)
SunAmerica Capital Securities and Exchange 858-8850 ext. 6010 or
Services, Inc. Commission, without send a written request
Harborside Financial charge, upon request, by with your name, the name
Center calling (800) 858-8850 or of your fund(s) and your
3200 Plaza 5 on the U.S. Securities account number(s) to
Jersey City, NJ and Exchange Commission's SunAmerica Mutual Funds
07311-4992 website at c/o BFDS, P.O. Box
http://www.sec.gov. 219186, Kansas City MO,
64121-9186. We will
DISCLOSURE OF QUARTERLY resume individual
PORTFOLIO HOLDINGS mailings for your account
The Trust is required to within thirty (30) days
file its complete of receipt of your
schedule of portfolio request.
holdings with the U.S.
Securities and Exchange The accompanying report
Commission for its first has not been audited by
and third fiscal quarters independent accountants
on Form N-Q. The Trust's and accordingly no
Forms N-Q are available opinion has been
on the U.S. Securities expressed thereon.
and Exchange Commission's
website at
http://www.sec.gov. You
can also review and
obtain copies of the
Forms N-Q at the U.S.
Securities and Exchange
Com-mission's Public
Reference Room in
Wash-ington, DC
(information on the
operation of Public
Reference Room may be
obtained by calling
1-800-SEC-0330).
[GRAPHIC]
GO PAPERLESS!!
DID YOU KNOW THAT YOU HAVE THE OPTION TO
RECEIVE YOUR SHAREHOLDER REPORTS ONLINE?
By choosing this convenient service, you will no longer receive paper copies of
Fund documents such as annual reports, semi-annual reports, prospectuses and
proxy statements in the mail. Instead, you are provided with quick and easy
access to this information via the Internet.
Why Choose Electronic Delivery?
IT'S QUICK -- Fund documents will be received faster than via traditional mail.
IT'S CONVENIENT -- Elimination of bulky documents from personal files.
IT'S COST EFFECTIVE -- Reduction of your Fund's printing and mailing costs.
TO SIGN UP FOR ELECTRONIC DELIVERY, FOLLOW
THESE SIMPLE STEPS:
1 GO TO WWW.SAFUNDS.COM
2 CLICK ON THE LINK TO "GO PAPERLESS!!"
The email address you provide will be kept strictly confidential. Once your
enrollment has been processed, you will begin receiving email notifications
when anything you receive electronically is available online.
You can return to www.safunds.com at any time to change your email
address, edit your preferences or to cancel this service if you choose to
resume physical delivery of your Fund documents.
Please note - this option is only available to accounts opened through the
Funds.
FOR INFORMATION ON RECEIVING THIS REPORT ONLINE, SEE INSIDE BACK COVER.
FUNDS DISTRIBUTED BY SUNAMERICA CAPITAL SERVICES, INC.
This fund report must be preceded by or accompanied by a prospectus.
Investors should carefully consider a Fund's investment objectives, risks,
charges and expenses before investing. The prospectus, containing this and
other important information, can be obtained from your financial adviser, the
SunAmerica Sales Desk at 800-858-8850, ext. 6003, or at www.safunds.com. Read
the prospectus carefully before investing.
WWW.SAFUNDS.COM
EQSAN - 3/13
[LOGO]
AIG
Sun America
Mutual Funds
Item 2. Code of Ethics.
Not applicable.
Item 3. Audit Committee Financial Expert.
Not applicable.
Item 4. Principal Accountant Fees and Services.
Not applicable.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Investments.
Included in Item 1 to the Form.
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.
There were no material changes to the procedures by which shareholders
may recommend nominees to the registrant's Board of Trustees that were
implemented after the registrant last provided disclosure in response
to the requirements of Item 407(c)(2)(iv) of Regulation S-K (17 CFR
299.407) (as required by 22(b)(15)) of Schedule 14A (17 CFR 240.14a-
101), or this Item 10.
Item 11. Controls and Procedures.
(a) An evaluation was performed within 90 days of the filing of this
report, under the supervision and with the participation of the
registrant's management, including the President and Treasurer, of the
effectiveness of the design and operation of the registrant's
disclosure controls and procedures (as defined under Rule 30a-3(c)
under the Investment Company Act of 1940 (17 CFR 270. 30a-3(c))). Based
on that evaluation, the registrant's management, including the
President and Treasurer, concluded that the registrant's disclosure
controls and procedures are effective.
(b) There was no change in the registrant's internal control over financial
reporting (as defined in Rule 30a-3(d) under the Investment Company Act
of 1940 (17 CFR 270.30a-3(d))) that occurred during the registrant's
last fiscal quarter of the period covered by this report that has
materially affected, or is reasonably likely to materially affect, the
registrant's internal contro1 over financial reporting.
Item 12. Exhibits.
(a) (1) Not applicable.
(2) Certifications pursuant to Rule 30a-2(a) under the Investment
Company Act of 1940 (17 CFR 270.30a-2(a)) attached hereto as Exhibit
99.CERT.
(3) Not applicable.
(b) Certification pursuant to Rule 30a-2(b)under the Investment Company
Act of 1940 (17 CFR 270.30a-2(a)) and Section 906 of the
Sarbanes-Oxley Act of 2002 attached hereto as Exhibit 99.906.CERT.
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.
SunAmerica Equity Funds
By: /s/ John T. Genoy
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John T. Genoy
President
Date: June 6, 2013
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/ John T. Genoy
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John T. Genoy
President
Date: June 6, 2013
By: /s/ Donna M. Handel
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Donna M. Handel
Treasurer
Date: June 6, 2013