U.S. nonfarm payrolls continued to slowly improve, averaging 272,000 jobs added for March, April and May, while the unemployment rate fell to 6.1%. First-quarter GDP was revised down from -1.0% to -2.9% as the harsh winter weather conditions took their toll on the economy. However, economic data for the second quarter showed signs of stabilizing.
The Fund returned 1.15% during the second quarter, outperforming its benchmark. The Funds allocation to mortgage-backed securities was a positive contributor to performance, as was our security selection within the sector.
If you're a conservative investor who prefers the income and quality assurance offered by government securities, you may find this Fund attractive. It is best suited for investors with relatively low-risk profiles and can provide a solid-core holding for income-oriented investors of all ages.
- Invest primarily in securities issued or guaranteed by the U.S. government or by its agencies.
- Select high-quality securities with maturities, under normal circumstances, between one and 10 years, with risk exposure managed in an effort to achieve reasonable returns.
- Buy and sell securities using a relative value approach that employs models that analyze and compare expected returns and assumed risks.