Global Sustainability Index
as of June 30, 2014
Fund Commentary
The Global Sustainability Index Fund returned 4.89% for the second quarter of 2014, closely tracking the MSCI World ESG Index, which returned 4.77%. The World ESG Index slightly underperformed the MSCI World Index, which returned 4.86% for the same period.

The United States, at approximately 50% of the Index, returned 5.21% during the quarter. Hong Kong, Canada and Norway posted the best performance, returning 10.93%, 10.78% and 9.85%, respectively. Japan, which makes up nearly 10% of the Index, returned 6.38%, while the United Kingdom, which also accounts for slightly less than 10% of the Index, returned 4.11%.

Developed market equities provided positive returns in the quarter, driven by positive global economic growth indicators and continued accommodative monetary policy from a range of central banks. The market shrugged off mounting geopolitical risks, including continued instability in Ukraine and the rise of the Islamic State of Iraq and the Levant (ISIS), instead appearing to focus on positive signals from the corporate sector and the global economy in general. Global growth appeared to accelerate during the period after a dismal first quarter resulting partly from an unusually harsh U.S. winter. An increase in U.S. merger and acquisition activity contributed to investor optimism, and upward earnings revisions further boosted the markets. Despite the increased optimism and positive economic results, central banks remained dovish. The U.S. Federal Reserve maintained its near-zero short-term rate policy and measured pace of bond purchase tapering, while the European Central Bank went further by introducing a negative deposit rate.
Investor Profile

If you are an investor who wants to invest in a broad, diversified set of large- and mid-cap developed global companies in North America, Europe and Asia-Pacific, that are selected based on sector ranking of environmental, social and government factors, you may find this Fund attractive.

Philosophy
  • Seek to duplicate the investment composition and overall performance of the stocks included in the MSCI World ESG Index.
  • The Index is a diversified, sector neutral global benchmark constructed using environmental, social and governance (ESG) factors.
  • Sector and regional neutrality is designed to help the Index outperform other social responsibility and sustainability indices.
 
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