as of March 31, 2014
Fund Commentary
The Fund returned 1.79% during the first quarter, in line with the 1.81% return of the S&P 500® Index. Large-cap equities underperformed mid caps, as measured by the 3.04% return of the S&P MidCap 400® Index, but slightly outperformed small caps, as gauged by the 1.13% return of the S&P SmallCap 600® Index.

The top-performing sectors in the Index were utilities and health care, which returned 10.09% and 5.81%, respectively. The bottom-performing sectors were consumer discretionary and industrials, with returns of -2.80% and 0.14%, respectively. Defensive stocks typically performed well during a period in which investors grew more concerned about potential risk factors, while those with higher economic sensitivity generally lagged.

After finishing 2013 with a return of 32.4%, large-cap U.S. equities paused, and a number of concerns contributed to the muted performance. These included slower-than- expected economic data in the United States, the conflict between Russia and Ukraine, and evidence of deteriorating credit conditions in China. In addition, the markets faced headwinds created by the U.S. Federal Reserve (Fed) tapering its stimulative asset purchase program, as well as the new threat that the Fed may enact its first interest rate increase sooner than investors were expecting. At the same time, however, the markets were supported by many of the same factors that led to such strong performance in 2013, including steady corporate earnings, robust corporate balance sheets and the lack of significant return potential in either bonds or cash.
Investor Profile

If you're a moderate-risk investor seeking competitive long-term investment returns through a broadly diversified portfolio, this Fund may be appropriate for you. It offers a high degree of relative predictability in an uncertain stock market by seeking investment results, before expenses, approximating the aggregate price and dividend performance of the securities included in the S&P 500 Stock Index.

  • Passively managed, the Fund seeks to duplicate the investment composition and overall performance of the stocks included in the S&P 500® Index.
  • Invest at least 80% of its net assets in equity securities in the Index, in weightings that approximate the relative composition of the Index.
  • Use proprietary quantitative techniques designed to minimize trading costs.
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Not FDIC insured | May lose value | No bank guarantee

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