as of June 30, 2014
Fund Commentary
The Fund returned 5.18% during the quarter, while the S&P 500® Index returned 5.23%. Large-cap equities outperformed both mid caps, as measured by the 4.33% return of the S&P MidCap 400® Index, and small caps, as gauged by the 2.07% return of the S&P SmallCap 600® Index.

Robust equity performance was driven by positive economic growth, increased merger and acquisition activity and the accommodative monetary policies of global central banks. The market shrugged off mounting geopolitical risk and focused instead on positive signals from the corporate sector and the economy in general. Global growth appeared to accelerate after a dismal first quarter that was largely a result of the unusually harsh winter in the United States. Despite increased investor optimism, upward earnings revisions and positive economic results, central banks remained dovish. The U.S. Federal Reserve appears on track to keep short-term rates near their current levels through mid-2015, while the European Central Bank introduced a negative deposit rate. These favorable central bank policies sparked a continued decline in bond yields, which in turn supported stock market performance by fueling large inflows of investor cash into equities.

The top-performing sectors in the Index were energy and utilities, which returned 12.09% and 7.77%, respectively. Energy stocks gained as the price of oil rose sharply amid growing concerns regarding the conflict in the Middle East, while utilities were supported by the environment of declining bond yields. The bottom-performing sectors were financials and consumer discretionary, with returns of 2.30% and 3.50%, respectively.
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.

Philosophy
  • 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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