Multi-Manager Mid Cap
as of March 31, 2014
Fund Commentary
The U.S. economy continues to grow, but the pace of growth slackened during the winter months, due in part to unfavorable weather. In the first quarter, increased geopolitical risk from the Russia/Ukraine conflict and a more hawkish-than-expected stance from U.S. Federal Reserve Chair Janet Yellen contributed to volatility in the U.S. equity market, which nevertheless finished with a positive return. Mid-cap stocks as measured by the Russell Midcap® Index returned 3.53%, outperforming their large- and small-cap counterparts. The Russell Midcap® Value Index led domestic equity markets, outperforming the Russell Midcap® Growth Index by 3.18% during the quarter. Defensive sectors such as health care and utilities outperformed cyclical sectors. For the same period, REITs were top gainers, returning 8.6% as measured by the Dow Jones All Equity REIT Total Return Index.

The Multi-Manager Mid Cap Fund underperformed during the quarter, with a return of 1.68% compared with the Russell Midcap® return of 3.53%. Stock selection drove the Fund’s underperformance during the quarter, with particular weakness in the healthcare and industrials sectors.

Sub-adviser LSV’s quantitative portfolio was the strongest performer during the quarter, returning over 5% and matching the strong returns of the Russell Midcap Value Index. The Fund’s other sub-advisers, Geneva and Systematic, both underperformed meaningfully during the period. Geneva’s stock selection within the technology sector hindered results, while Systematic was hurt by performance among financials and consumer discretionary holdings.
Investor Profile

If you're a long-term investor looking to diversify your investments by pursuing the growth potential of mid-sized company stocks, then this Fund may be right for you. It is intended for investors who are aware that mid-sized company stocks are generally riskier than large-company stocks due to greater volatility and less liquidity.

  • Invest in mid-cap stocks through a variety of external mid-cap managers who have distinct investment styles and strategies.
  • Select complementary managers from a broad universe of investment managers.
  • Blend managers into a single fund in an effort to provide an attractive combination of risk and return.
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Not FDIC insured | May lose value | No bank guarantee

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