2020-10-16FixedIncomeFunds-Retail-January
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Prospectus January
1, 2021 |
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Fund |
Administrator
Class |
Wells
Fargo Adjustable Rate Government Fund |
ESADX |
Wells
Fargo Core Plus Bond Fund |
WIPDX |
Wells
Fargo Government Securities Fund |
WGSDX |
Wells
Fargo High Yield Bond Fund |
EKHYX |
Wells
Fargo Short Duration Government Bond Fund |
MNSGX |
Wells
Fargo Short-Term High Yield Bond Fund |
WDHYX |
Wells
Fargo Ultra Short-Term Income Fund |
WUSDX |
The U.S.
Securities and Exchange Commission (“SEC”) has not approved or disapproved these
securities or passed upon the accuracy or adequacy of this Prospectus. Anyone
who tells you
otherwise is committing a crime.
Fund
shares are NOT deposits or other obligations of, or guaranteed by, Wells Fargo
Bank, N.A., its affiliates or any other depository institution. Fund shares are
not insured or guaranteed
by the U.S. Government, the Federal Deposit Insurance Corporation or any other
government agency and may lose value.
Adjustable
Rate Government Fund Summary
Investment
Objective
The Fund
seeks current income consistent with capital
preservation.
Fees
and Expenses
These
tables are intended to help you understand the various costs and expenses you
will pay if you buy and hold shares of
the Fund.
|
|
Shareholder
Fees (fees paid directly from your investment)
|
|
Maximum
sales charge (load) imposed on purchases (as a percentage of offering
price) |
None |
Maximum
deferred sales charge (load) (as a percentage of offering
price) |
None |
|
|
|
Management
Fees |
0.35% |
Distribution
(12b-1) Fees |
0.00% |
Other
Expenses |
0.47% |
Acquired
Fund Fees and Expenses |
0.01% |
Total
Annual Fund Operating Expenses |
0.83% |
Fee
Waivers |
(0.22)% |
Total
Annual Fund Operating Expenses After Fee Waivers2
|
% |
1. |
Expenses
have been adjusted as necessary from amounts incurred during the Fund’s
most recent fiscal year to reflect current fees and expenses.
|
2. |
The
Manager has contractually committed through December
31, 2021, to
waive fees and/or reimburse expenses to the extent necessary to
cap Total Annual Fund Operating Expenses After Fee Waiver at 0.60%
for Administrator
Class. Brokerage commissions, stamp duty fees, interest,
taxes, acquired fund fees and expenses (if any), and extraordinary
expenses are excluded from the expense cap. Prior to or after the
commitment
expiration date, the cap may be increased or the commitment to maintain
the cap may be terminated only with the approval of
the Board of Trustees. |
Example
of Expenses
The
example below is intended to help you compare the costs of investing in the Fund
with the costs of investing in other
funds. The example assumes a $10,000 initial investment, 5% annual total return,
and that fees and expenses
remain the same as in the tables above. To the extent that the Manager is
waiving fees or reimbursing expenses,
the example assumes that such waiver or reimbursement will only be in place
through the date noted above.
Although your actual costs may be higher or lower, based on these assumptions,
your costs would be:
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|
After:
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1
Year |
$62 |
3
Years |
$243 |
5
Years |
$439 |
10
Years |
$1,005 |
Portfolio
Turnover
The Fund
pays transaction costs, such as commissions, when it buys and sells securities
(or “turns over” its portfolio).
A higher portfolio turnover rate may indicate higher transaction costs and may
result in higher taxes when Fund
shares are held in a taxable account. These costs, which are not reflected in
annual fund operating expenses
or in the example, affect the Fund’s performance. During the most recent fiscal
year, the Fund’s portfolio turnover
rate was 9% of the
average value of its portfolio.
Principal
Investment Strategies
Under
normal circumstances, we invest:
■ |
at
least 80% of the Fund’s net assets in mortgage-backed and asset-backed
securities issued or guaranteed by U.S.
Government agencies or government-sponsored entities, that have interest
rates that reset at periodic intervals;
and |
■ |
up to
20% of the Fund’s total assets in obligations that pay fixed interest
rates. |
We invest
principally in mortgage-backed securities (including collateralized mortgage
obligations (CMOs)) and asset-backed
securities issued or guaranteed by U.S. Government agencies or
government-sponsored entities. Under
normal circumstances, we expect to maintain an average credit quality rating for
the portfolio equivalent to the
highest rating available from a Nationally Recognized Statistical Ratings
Organization (NRSRO). In the event that a
NRSRO assigns U.S. sovereign debt a rating below its highest rating, we expect
to maintain an average credit
quality rating that is equivalent to the average rating assigned to U.S.
sovereign debt. We may also use futures
for duration and yield curve management. As part of our mortgage-backed
securities investment strategy, we may
enter into dollar roll transactions. Under normal circumstances, the
dollar-weighted average reset period of the
adjustable rate securities held by the Fund will not exceed one
year.
We employ
a top-down, macroeconomic outlook to determine the portfolio’s duration, yield
curve positioning, issuer
selection and sector allocation. Macroeconomic factors considered may include,
among others, the pace of economic
growth, employment conditions, corporate profits, inflation, monetary and fiscal
policy, as well as the influence
of international economic and financial conditions. In combination with our
top-down macroeconomic approach,
we employ a bottom-up process of fundamental securities analysis to select the
specific securities for investment.
Elements of this evaluation may include the effect of changing principal
prepayments, interest rate and yield
spread volatility, and the impact of changes in the level and shape of the yield
curve on a security’s value. We may
sell a security based on how we expect these factors to affect a security’s
value relative to its indicated sales
price as well as changes in portfolio strategy or cash flow needs. A security
may also be sold and replaced with one that
presents a better value or risk/reward
profile.
Principal
Investment Risks
An
investment in the Fund may lose money, is
not a deposit of Wells Fargo Bank, N.A. or its affiliates, is not insured
or
guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency, and is
primarily subject to
the risks briefly summarized below.
Market
Risk. The
values of, and/or the income generated by, securities held by the Fund may
decline due to general
market conditions or other factors, including those directly involving the
issuers of such securities. Securities
markets are volatile and may decline significantly in response to adverse
issuer, regulatory, political, or economic
developments. Different sectors of the market and different security types may
react differently to such
developments.
Debt
Securities Risk. Debt
securities are subject to credit risk and interest rate risk. Credit risk is the
possibility that the
issuer or guarantor of a debt security may be unable, or perceived to be unable,
to pay interest or repay principal
when they become due. In these instances, the value of an investment could
decline and the Fund could lose
money. Credit risk increases as an issuer’s credit quality or financial strength
declines. Interest rate risk is the possibility
that interest rates will change over time. When interest rates rise, the value
of debt securities tends to fall. The
longer the terms of the debt securities held by a Fund, the more the Fund is
subject to this risk. If interest rates
decline, interest that the Fund is able to earn on its investments in debt
securities may also decline, which could
cause the Fund to reduce the dividends it pays to shareholders, but the value of
those securities may increase.
Very low or negative interest rates may magnify interest rate
risk.
Mortgage-
and Asset-Backed Securities Risk. Mortgage-
and asset-backed securities may decline in value and become
less liquid when defaults on the underlying mortgages or assets occur and may
exhibit additional volatility in periods
of rising interest rates. Rising interest rates tend to extend the duration of
these securities, making them more
sensitive to changes in interest rates than instruments with fixed payment
schedules. When interest rates
decline or are low, the prepayment of mortgages or assets underlying such
securities can reduce a Fund’s returns.
U.S.
Government Obligations Risk. U.S.
Government obligations may be adversely impacted by changes in interest
rates, and securities issued or guaranteed by U.S. Government agencies or
government-sponsored entities
may not be backed by the full faith and credit of the U.S.
Government.
Derivatives
Risk. The use
of derivatives, such as futures, options and swap agreements, can lead to
losses, including
those magnified by leverage, particularly when derivatives are used to enhance
return rather than mitigate
risk. Certain derivative instruments may be difficult to sell when the portfolio
manager believes it would be
appropriate to do so, or the other party to a derivative contract may be
unwilling or unable to fulfill its contractual
obligations.
Futures
Contracts Risk. A Fund
that uses futures contracts, which are a type of derivative, is subject to the
risk of loss
caused by unanticipated market movements. In addition, there may at times be an
imperfect correlation between
the movement in the prices of futures contracts and the value of their
underlying instruments or indexes, and there
may at times not be a liquid secondary market for certain futures
contracts.
Management
Risk.
Investment decisions, techniques, analyses or models implemented by a
Fund’s manager or sub-adviser
in seeking to achieve the Fund’s investment objective may not produce expected
returns, may cause the Fund’s
shares to lose value or may cause the Fund to underperform other funds with
similar investment objectives.
Performance
The
following information provides some indication of the risks of investing in the
Fund by showing changes in the Fund’s
performance from year to year. The
Fund’s average annual total returns are compared to the performance of one or
more indices. Past
performance before and after taxes is no guarantee of future
results. Current
month-end
performance is available on the Fund’s website at wfam.com.
|
|
|
Calendar
Year Total Returns for Administrator Class as of 12/31 each
year1,2
|
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Highest
Quarter: June
30, 2010
|
+1.10%
|
Lowest
Quarter: December
31, 2015
|
-0.20%
|
Year-to-date
total return
as of September
30, 2020 is
+1.03%
|
|
|
|
|
|
|
|
|
Inception
Date
of Share
Class |
1
Year |
5
Year |
10
Year |
Administrator
Class (before taxes) |
7/30/2010
|
2.95% |
1.02% |
1.31% |
Administrator
Class (after taxes on distributions) |
7/30/2010
|
1.97% |
0.48% |
0.79% |
Administrator
Class (after taxes on distributions and the
sale of Fund Shares) |
7/30/2010
|
1.75% |
0.54% |
0.79% |
Bloomberg
Barclays 6-Month Treasury Bill Index (reflects
no deduction for fees, expenses, or taxes) |
|
2.55% |
1.28% |
0.75% |
1. |
Historical
performance shown prior to July 12, 2010 is based on the performance of
the Fund’s predecessor, Evergreen Adjustable Rate Fund. |
2. |
Historical
performance shown for the Administrator Class shares prior to their
inception reflects the performance of the Institutional Class shares,
adjusted to reflect the higher expenses applicable to the Administrator
Class shares. |
After-tax
returns are calculated using the historical highest individual federal marginal
income tax rates and do not reflect
the impact of state, local or foreign taxes.
Actual
after-tax returns depend on an investor’s tax situation and may
differ from those shown, and after-tax returns shown are not relevant to
tax-exempt investors or investors
who hold their Fund shares through tax-deferred arrangements, such as 401(k)
Plans or Individual Retirement
Accounts.
Fund
Management
|
|
|
Manager |
Sub-Adviser |
Portfolio
Manager, Title/Managed Since |
Wells
Fargo Funds Management,
LLC |
Wells
Capital Management Incorporated |
Christopher
Y. Kauffman, CFA,
Portfolio Manager / 2008 Michal
Stanczyk,
Portfolio Manager / 2015 |
Purchase
and Sale of Fund Shares
Administrator
Class shares are generally available through intermediaries for the
accounts of their customers and directly
to institutional investors and individuals. Institutional investors may include
corporations; private banks and trust
companies; endowments and foundations; defined contribution, defined benefit and
other employer sponsored
retirement plans; institutional retirement plan platforms; insurance companies;
registered investment advisor
firms; bank trusts; 529 college savings plans; family offices; and funds of
funds, including those managed by Funds
Management. In general, you can buy or sell shares of the Fund online or by
mail, phone or wire, on any day the
New York Stock Exchange (“NYSE”) is open for regular trading. You also may buy
and sell shares through a financial
professional.
|
|
Minimum
Investments |
To
Buy or Sell Shares |
Minimum
Initial Investment Administrator
Class: $1 million (this amount may be reduced or eliminated for
certain
eligible investors)
Minimum
Additional Investment Administrator
Class: None |
Mail:
Wells Fargo Funds P.O.
Box 219967 Kansas
City, MO 64121-9967 Online:
wfam.com Phone
or Wire:
1-800-222-8222 Contact
your financial professional. |
Tax
Information
Any
distributions you receive from the Fund may be taxable as ordinary income or
capital gains, except when your investment
is in an IRA, 401(k) or other tax-advantaged investment plan. However,
subsequent withdrawals from such a
tax-advantaged investment plan may be subject to federal income tax. You should
consult your tax adviser about your
specific tax situation.
Payments
to Intermediaries
If you
purchase a Fund through an intermediary, the Fund and its related companies may
pay the intermediary for the sale
of Fund shares and related services. These payments may create a conflict of
interest by influencing the intermediary
and your financial professional to recommend the Fund over another investment.
Consult your financial
professional or visit your intermediary’s website for more
information.
Core
Plus Bond Fund Summary
Investment
Objective
The Fund
seeks total return, consisting of current income and capital
appreciation.
Fees
and Expenses
These
tables are intended to help you understand the various costs and expenses you
will pay if you buy and hold shares of
the Fund.
|
|
Shareholder
Fees (fees paid directly from your investment)
|
|
Maximum
sales charge (load) imposed on purchases (as a percentage of offering
price) |
None |
Maximum
deferred sales charge (load) (as a percentage of offering
price) |
None |
|
|
|
Management
Fees |
0.43% |
Distribution
(12b-1) Fees |
0.00% |
Other
Expenses |
0.38% |
Acquired
Fund Fees and Expenses |
0.02% |
Total
Annual Fund Operating Expenses |
0.83% |
Fee
Waivers |
(0.19)% |
Total
Annual Fund Operating Expenses After Fee Waivers2
|
% |
1. |
Expenses
have been adjusted as necessary from amounts incurred during the Fund’s
most recent fiscal year to reflect current fees and expenses.
|
2. |
The
Manager has contractually committed through December
31, 2021, to
waive fees and/or reimburse expenses to the extent necessary to
cap Total Annual Fund Operating Expenses After Fee Waiver at 0.62%
for Administrator
Class. Brokerage commissions, stamp duty fees, interest,
taxes, acquired fund fees and expenses (if any), and extraordinary
expenses are excluded from the expense cap. Prior to or after the
commitment
expiration date, the cap may be increased or the commitment to maintain
the cap may be terminated only with the approval of
the Board of Trustees. |
Example
of Expenses
The
example below is intended to help you compare the costs of investing in the Fund
with the costs of investing in other
funds. The example assumes a $10,000 initial investment, 5% annual total return,
and that fees and expenses
remain the same as in the tables above. To the extent that the Manager is
waiving fees or reimbursing expenses,
the example assumes that such waiver or reimbursement will only be in place
through the date noted above.
Although your actual costs may be higher or lower, based on these assumptions,
your costs would be:
|
|
After:
|
|
1
Year |
$65 |
3
Years |
$246 |
5
Years |
$442 |
10
Years |
$1,008 |
Portfolio
Turnover
The Fund
pays transaction costs, such as commissions, when it buys and sells securities
(or “turns over” its portfolio).
A higher portfolio turnover rate may indicate higher transaction costs and may
result in higher taxes when Fund
shares are held in a taxable account. These costs, which are not reflected in
annual fund operating expenses
or in the example, affect the Fund’s performance. During the most recent fiscal
year, the Fund’s portfolio turnover
rate was 130% of the
average value of its portfolio.
Principal
Investment Strategies
Under
normal circumstances, we invest:
■ |
at
least 80% of the Fund’s net assets in debt
securities; |
■ |
up to
35% of the Fund’s total assets in debt securities that are below
investment-grade;
and |
■ |
up to
25% of the Fund’s total assets in debt securities of foreign issuers,
including emerging markets issuers and debt
securities denominated in foreign
currencies. |
We invest
principally in debt securities, including corporate, mortgage- and asset-backed
securities, bank loans, foreign
sovereign debt, supranational agencies, and U.S. Government obligations. These
securities may have fixed, floating
or variable rates and may include debt securities of both domestic and foreign
issuers. We invest in both investment-grade
and below investment-grade debt securities (often called “high yield” securities
or “junk bonds”),
including unrated securities, as well as securities that are in default at the
time of purchase.
We may
invest in debt securities of foreign issuers, including emerging markets
issuers, denominated in any currency.
We may seek to add yield by having exposures to a variety of credits, mortgages,
and higher yielding countries
and currencies. We may also use futures and swap agreements to manage risk or to
enhance return. We may enter
into currency-related transactions through derivative instruments, including
currency and cross currency
forwards. The use of derivative currency transactions is intended to allow the
Fund to manage, hedge or reduce a
foreign currency-specific risk exposure of a portfolio security or its
denominated currency or to obtain net long
exposure to selected currencies for the purpose of generating income or
additional returns.
While we
may purchase securities of any maturity or duration, under normal circumstances,
we expect to maintain an overall
portfolio dollar-weighted average effective duration that is within 1 year of
that of the Fund’s benchmark.
The Fund’s benchmark, the Bloomberg Barclays U.S. Aggregate Bond Index, had a
duration of 6.23 years, as
of November 30, 2020. “Dollar-Weighted Average Effective Duration” is an
aggregate measure of the sensitivity
of a fund’s fixed income portfolio securities to changes in interest rates. As a
general matter, the price of a fixed
income security with a longer effective duration will fluctuate more in response
to changes in interest rates than
the price of a fixed income security with a shorter effective
duration.
We start
our investment process with a top-down, macroeconomic outlook to determine
portfolio duration and yield
curve positioning as well as industry, sector and credit quality allocations.
Macroeconomic factors considered may
include, among others, the pace of economic growth, employment conditions,
corporate profits, inflation, monetary
and fiscal policy, as well as the influence of international economic and
financial conditions. Within these parameters,
we then apply rigorous credit research to select individual securities that we
believe can add value from
income and/or the potential for capital appreciation. Our credit research may
include an assessment of an issuer’s
general financial condition, its competitive positioning and management
strength, as well as industry characteristics
and other factors. We may sell a security due to changes in credit
characteristics or outlook, as well as changes
in portfolio strategy or cash flow needs. A security may also be sold and
replaced with one that presents a
better value or risk/reward profile.
Principal
Investment Risks
An
investment in the Fund may lose money, is
not a deposit of Wells Fargo Bank, N.A. or its affiliates, is not insured
or
guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency, and is
primarily subject to
the risks briefly summarized below.
Market
Risk. The
values of, and/or the income generated by, securities held by the Fund may
decline due to general
market conditions or other factors, including those directly involving the
issuers of such securities. Securities
markets are volatile and may decline significantly in response to adverse
issuer, regulatory, political, or economic
developments. Different sectors of the market and different security types may
react differently to such
developments.
Debt
Securities Risk. Debt
securities are subject to credit risk and interest rate risk. Credit risk is the
possibility that the
issuer or guarantor of a debt security may be unable, or perceived to be unable,
to pay interest or repay principal
when they become due. In these instances, the value of an investment could
decline and the Fund could lose
money. Credit risk increases as an issuer’s credit quality or financial strength
declines. Interest rate risk is the possibility
that interest rates will change over time. When interest rates rise, the value
of debt securities tends to fall. The
longer the terms of the debt securities held by a Fund, the more the Fund is
subject to this risk. If interest rates
decline, interest that the Fund is able to earn on its investments in debt
securities may also decline, which could
cause the Fund to reduce the dividends it pays to shareholders, but the value of
those securities may increase.
Very low or negative interest rates may magnify interest rate
risk.
Derivatives
Risk. The use
of derivatives, such as futures, options and swap agreements, can lead to
losses, including
those magnified by leverage, particularly when derivatives are used to enhance
return rather than mitigate
risk. Certain derivative instruments may be difficult to sell when the portfolio
manager believes it would be
appropriate to do so, or the other party to a derivative contract may be
unwilling or unable to fulfill its contractual
obligations.
Emerging
Markets Risk. Emerging
market securities typically present even greater exposure to the risks
described
under “Foreign Investment Risk” and may be particularly sensitive to global
economic conditions. Emerging
market securities are also typically less liquid than securities of developed
countries and could be difficult
to sell, particularly during a market
downturn.
Foreign
Currency Contracts Risk. A Fund
that enters into forwards or other foreign currency contracts, which are
a type of
derivative, is subject to the risk that the portfolio manager may be incorrect
in his or her judgment of future
exchange rate changes.
Foreign
Investment Risk. Foreign
investments may be subject to lower liquidity, greater price volatility and
risks related to
adverse political, regulatory, market or economic developments. Foreign
investments may involve exposure
to changes in foreign currency exchange rates and may be subject to higher
withholding and other taxes.
Futures
Contracts Risk. A Fund
that uses futures contracts, which are a type of derivative, is subject to the
risk of loss
caused by unanticipated market movements. In addition, there may at times be an
imperfect correlation between
the movement in the prices of futures contracts and the value of their
underlying instruments or indexes, and there
may at times not be a liquid secondary market for certain futures
contracts.
High
Yield Securities Risk. High
yield securities and unrated securities of similar credit quality (commonly
known as “junk
bonds”) have a much greater risk of default or of not returning principal and
their values tend to be more volatile
than higher-rated securities with similar
maturities.
Loan
Risk. Loans may
be unrated, less liquid and more difficult to value than traditional debt
securities. The highly leveraged
capital structure of the borrowers in such transactions may make such loans
especially vulnerable to adverse
changes in financial, economic or market conditions. A Fund may be unable to
sell loans at a desired time or price.
The Fund may also not be able to control amendments, waivers or the exercise of
any remedies that a lender
would have under a direct loan and may assume liability as a
lender.
Management
Risk.
Investment decisions, techniques, analyses or models implemented by a
Fund’s manager or sub-adviser
in seeking to achieve the Fund’s investment objective may not produce expected
returns, may cause the Fund’s
shares to lose value or may cause the Fund to underperform other funds with
similar investment objectives.
Mortgage-
and Asset-Backed Securities Risk. Mortgage-
and asset-backed securities may decline in value and become
less liquid when defaults on the underlying mortgages or assets occur and may
exhibit additional volatility in periods
of rising interest rates. Rising interest rates tend to extend the duration of
these securities, making them more
sensitive to changes in interest rates than instruments with fixed payment
schedules. When interest rates
decline or are low, the prepayment of mortgages or assets underlying such
securities can reduce a Fund’s returns.
Swaps
Risk.
Depending on their structure, swap agreements and options to enter into swap
agreements (“swaptions”),
both of which are types of derivatives, may increase or decrease a Fund’s
exposure to long- or short-term
interest rates, foreign currency values, mortgage-backed securities, corporate
borrowing rates, or credit
events or other reference points such as security prices or inflation
rates.
U.S.
Government Obligations Risk. U.S.
Government obligations may be adversely impacted by changes in interest
rates, and securities issued or guaranteed by U.S. Government agencies or
government-sponsored entities
may not be backed by the full faith and credit of the U.S.
Government.
Performance
The
following information provides some indication of the risks of investing in the
Fund by showing changes in the Fund’s
performance from year to year. The
Fund’s average annual total returns are compared to the performance of one or
more indices. Past
performance before and after taxes is no guarantee of future
results. Current
month-end
performance is available on the Fund’s website at wfam.com.
|
|
|
Calendar
Year Total Returns for Administrator Class as of 12/31 each
year1
|
|
Highest
Quarter: March
31, 2019
|
+3.42%
|
Lowest
Quarter: June
30, 2013
|
-2.70%
|
Year-to-date
total return
as of September
30, 2020 is
+8.42%
|
|
|
|
|
|
|
|
|
Inception
Date
of Share
Class |
1
Year |
5
Year |
10
Year |
Administrator
Class (before taxes) |
7/30/2010
|
9.24% |
3.98% |
4.65% |
Administrator
Class (after taxes on distributions) |
7/30/2010
|
7.63% |
2.74% |
3.37% |
Administrator
Class (after taxes on distributions and the
sale of Fund Shares) |
7/30/2010
|
5.52% |
2.51% |
3.11% |
Bloomberg
Barclays U.S. Aggregate Bond Index (reflects
no deduction for fees, expenses, or taxes) |
|
8.72% |
3.05% |
3.75% |
1. |
Historical
performance shown for the Administrator Class shares prior to their
inception reflects the performance of the Institutional Class
shares
and has been adjusted to include the higher expenses applicable to
the Administrator Class
shares. |
After-tax
returns are calculated using the historical highest individual federal marginal
income tax rates and do not reflect
the impact of state, local or foreign taxes.
Actual
after-tax returns depend on an investor’s tax situation and may
differ from those shown, and after-tax returns shown are not relevant to
tax-exempt investors or investors
who hold their Fund shares through tax-deferred arrangements, such as 401(k)
Plans or Individual Retirement
Accounts.
Fund
Management
|
|
|
Manager |
Sub-Adviser |
Portfolio
Manager, Title/Managed Since |
Wells
Fargo Funds Management, LLC |
Wells
Capital Management Incorporated |
Christopher
Y. Kauffman, CFA,
Porfolio Manager
/ 2015 Jay
N. Mueller, CFA,
Portfolio Manager / 2018 Janet
S. Rilling, CFA, CPA,
Portfolio Manager
/ 2008 Michael
J. Schueller, CFA,
Portfolio Manager
/ 2017 Noah
M. Wise, CFA,
Portfolio Manager / 2015 |
Purchase
and Sale of Fund Shares
Administrator
Class shares are generally available through intermediaries for the
accounts of their customers and directly
to institutional investors and individuals. Institutional investors may include
corporations; private banks and trust
companies; endowments and foundations; defined contribution, defined benefit and
other employer sponsored
retirement plans; institutional retirement plan platforms; insurance companies;
registered investment advisor
firms; bank trusts; 529 college savings plans; family offices; and funds of
funds, including those managed by Funds
Management. In general, you can buy or sell shares of the Fund online or by
mail, phone or wire, on any day the
New York Stock Exchange (“NYSE”) is open for regular trading. You also may buy
and sell shares through a financial
professional.
|
|
Minimum
Investments |
To
Buy or Sell Shares |
Minimum
Initial Investment Administrator
Class: $1 million (this amount may be reduced or eliminated for
certain
eligible investors)
Minimum
Additional Investment Administrator
Class: None |
Mail:
Wells Fargo Funds P.O.
Box 219967 Kansas
City, MO 64121-9967 Online:
wfam.com Phone
or Wire:
1-800-222-8222 Contact
your financial professional. |
Tax
Information
Any
distributions you receive from the Fund may be taxable as ordinary income or
capital gains, except when your investment
is in an IRA, 401(k) or other tax-advantaged investment plan. However,
subsequent withdrawals from such a
tax-advantaged investment plan may be subject to federal income tax. You should
consult your tax adviser about your
specific tax situation.
Payments
to Intermediaries
If you
purchase a Fund through an intermediary, the Fund and its related companies may
pay the intermediary for the sale
of Fund shares and related services. These payments may create a conflict of
interest by influencing the intermediary
and your financial professional to recommend the Fund over another investment.
Consult your financial
professional or visit your intermediary’s website for more
information.
Government
Securities Fund Summary
Investment
Objective
The Fund
seeks current income.
Fees
and Expenses
These
tables are intended to help you understand the various costs and expenses you
will pay if you buy and hold shares of
the Fund.
|
|
Shareholder
Fees (fees paid directly from your investment)
|
|
Maximum
sales charge (load) imposed on purchases (as a percentage of offering
price) |
None |
Maximum
deferred sales charge (load) (as a percentage of offering
price) |
None |
|
|
|
Management
Fees |
0.44% |
Distribution
(12b-1) Fees |
0.00% |
Other
Expenses |
0.40% |
Acquired
Fund Fees and Expenses |
0.01% |
Total
Annual Fund Operating Expenses |
0.85% |
Fee
Waivers |
(0.20)% |
Total
Annual Fund Operating Expenses After Fee Waivers2
|
% |
1. |
Expenses
have been adjusted as necessary from amounts incurred during the Fund’s
most recent fiscal year to reflect current fees and expenses.
|
2. |
The
Manager has contractually committed through December
31, 2021, to
waive fees and/or reimburse expenses to the extent necessary to
cap Total Annual Fund Operating Expenses After Fee Waiver at 0.64%
for Administrator
Class. Brokerage commissions, stamp duty fees, interest,
taxes, acquired fund fees and expenses (if any), and extraordinary
expenses are excluded from the expense cap. Prior to or after the
commitment
expiration date, the cap may be increased or the commitment to maintain
the cap may be terminated only with the approval of
the Board of Trustees. |
Example
of Expenses
The
example below is intended to help you compare the costs of investing in the Fund
with the costs of investing in other
funds. The example assumes a $10,000 initial investment, 5% annual total return,
and that fees and expenses
remain the same as in the tables above. To the extent that the Manager is
waiving fees or reimbursing expenses,
the example assumes that such waiver or reimbursement will only be in place
through the date noted above.
Although your actual costs may be higher or lower, based on these assumptions,
your costs would be:
|
|
After:
|
|
1
Year |
$66 |
3
Years |
$251 |
5
Years |
$452 |
10
Years |
$1,030 |
Portfolio
Turnover
The Fund
pays transaction costs, such as commissions, when it buys and sells securities
(or “turns over” its portfolio).
A higher portfolio turnover rate may indicate higher transaction costs and may
result in higher taxes when Fund
shares are held in a taxable account. These costs, which are not reflected in
annual fund operating expenses
or in the example, affect the Fund’s performance. During the most recent fiscal
year, the Fund’s portfolio turnover
rate was 111% of the
average value of its portfolio.
Principal
Investment Strategies
Under
normal circumstances, we invest:
■ |
at
least 80% of the Fund’s net assets in U.S. Government obligations and
repurchase agreements collateralized by U.S.
Government obligations;
and |
■ |
up to
20% of the Fund’s net assets in non-government investment-grade debt
securities. |
We invest
principally in U.S. Government obligations, including debt securities issued or
guaranteed by the U.S. Treasury,
U.S. Government agencies or government-sponsored entities. These securities may
have fixed, floating or
variable rates and also include mortgage-backed securities. As part of our
mortgage-backed securities investment
strategy, we may enter into dollar rolls. We may also use futures for duration
and yield curve management.
We employ
a top-down, macroeconomic outlook to determine the portfolio’s duration, yield
curve positioning and sector
allocation. Macroeconomic factors considered may include, among others, the pace
of economic growth, employment
conditions, inflation, monetary and fiscal policy, as well as the influence of
international economic and
financial conditions. In combination with our top-down, macroeconomic approach,
we employ a bottom-up process of
fundamental securities analysis to select the specific securities for
investment. Elements of this evaluation
may include duration measurements, historical yield spread relationships,
volatility trends, mortgage refinance
rates, as well as other factors. We may sell a security due to changes in our
outlook, as well as changes in portfolio
strategy or cash flow needs. A security may also be sold and replaced with one
that presents a better value or
risk/reward profile.
Principal
Investment Risks
An
investment in the Fund may lose money, is
not a deposit of Wells Fargo Bank, N.A. or its affiliates, is not insured
or
guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency, and is
primarily subject to
the risks briefly summarized below.
Market
Risk. The
values of, and/or the income generated by, securities held by the Fund may
decline due to general
market conditions or other factors, including those directly involving the
issuers of such securities. Securities
markets are volatile and may decline significantly in response to adverse
issuer, regulatory, political, or economic
developments. Different sectors of the market and different security types may
react differently to such
developments.
Debt
Securities Risk. Debt
securities are subject to credit risk and interest rate risk. Credit risk is the
possibility that the
issuer or guarantor of a debt security may be unable, or perceived to be unable,
to pay interest or repay principal
when they become due. In these instances, the value of an investment could
decline and the Fund could lose
money. Credit risk increases as an issuer’s credit quality or financial strength
declines. Interest rate risk is the possibility
that interest rates will change over time. When interest rates rise, the value
of debt securities tends to fall. The
longer the terms of the debt securities held by a Fund, the more the Fund is
subject to this risk. If interest rates
decline, interest that the Fund is able to earn on its investments in debt
securities may also decline, which could
cause the Fund to reduce the dividends it pays to shareholders, but the value of
those securities may increase.
Very low or negative interest rates may magnify interest rate
risk.
U.S.
Government Obligations Risk. U.S.
Government obligations may be adversely impacted by changes in interest
rates, and securities issued or guaranteed by U.S. Government agencies or
government-sponsored entities
may not be backed by the full faith and credit of the U.S.
Government.
Derivatives
Risk. The use
of derivatives, such as futures, options and swap agreements, can lead to
losses, including
those magnified by leverage, particularly when derivatives are used to enhance
return rather than mitigate
risk. Certain derivative instruments may be difficult to sell when the portfolio
manager believes it would be
appropriate to do so, or the other party to a derivative contract may be
unwilling or unable to fulfill its contractual
obligations.
Futures
Contracts Risk. A Fund
that uses futures contracts, which are a type of derivative, is subject to the
risk of loss
caused by unanticipated market movements. In addition, there may at times be an
imperfect correlation between
the movement in the prices of futures contracts and the value of their
underlying instruments or indexes, and there
may at times not be a liquid secondary market for certain futures
contracts.
Management
Risk.
Investment decisions, techniques, analyses or models implemented by a
Fund’s manager or sub-adviser
in seeking to achieve the Fund’s investment objective may not produce expected
returns, may cause
the Fund’s
shares to lose value or may cause the Fund to underperform other funds with
similar investment objectives.
Mortgage-
and Asset-Backed Securities Risk. Mortgage-
and asset-backed securities may decline in value and become
less liquid when defaults on the underlying mortgages or assets occur and may
exhibit additional volatility in periods
of rising interest rates. Rising interest rates tend to extend the duration of
these securities, making them more
sensitive to changes in interest rates than instruments with fixed payment
schedules. When interest rates
decline or are low, the prepayment of mortgages or assets underlying such
securities can reduce a Fund’s returns.
Performance
The
following information provides some indication of the risks of investing in the
Fund by showing changes in the Fund’s
performance from year to year. The
Fund’s average annual total returns are compared to the performance of one or
more indices. Past
performance before and after taxes is no guarantee of future
results. Current
month-end
performance is available on the Fund’s website at wfam.com.
|
|
|
Calendar
Year Total Returns for Administrator Class as of 12/31 each
year |
|
Highest
Quarter: September
30, 2011
|
+4.06%
|
Lowest
Quarter: December
31, 2016
|
-3.07%
|
Year-to-date
total return
as of September
30, 2020 is
+6.33%
|
|
|
|
|
|
|
Average
Annual Total Returns for the periods ended
12/31/2019 |
|
Inception
Date
of Share
Class |
1
Year |
5
Year |
10
Year |
Administrator
Class (before taxes) |
4/8/2005
|
6.27% |
2.18% |
2.91% |
Administrator
Class (after taxes on distributions) |
4/8/2005
|
5.23% |
1.21% |
1.97% |
Administrator
Class (after taxes on distributions and the sale
of Fund Shares) |
4/8/2005
|
3.70% |
1.25% |
1.89% |
Bloomberg
Barclays U.S. Aggregate ex Credit Index (reflects
no deduction for fees, expenses, or taxes) |
|
6.66% |
2.47% |
3.15% |
Bloomberg
Barclays Intermediate U.S. Government Bond Index
(reflects no deduction for fees, expenses, or taxes) |
|
5.20% |
1.99% |
2.38% |
After-tax
returns are calculated using the historical highest individual federal marginal
income tax rates and do not reflect
the impact of state, local or foreign taxes.
Actual
after-tax returns depend on an investor’s tax situation and may
differ from those shown, and after-tax returns shown are not relevant to
tax-exempt investors or investors
who hold their Fund shares through tax-deferred arrangements, such as 401(k)
Plans or Individual Retirement
Accounts.
Fund
Management
|
|
|
Manager
|
Sub-Adviser |
Portfolio
Manager, Title / Managed Since |
Wells
Fargo Funds Management,
LLC |
Wells
Capital Management Incorporated |
Christopher
Y. Kauffman, CFA,
Portfolio Manager / 2010 Jay
N. Mueller, CFA,
Portfolio Manager / 2015 Michal
Stanczyk,
Portfolio Manager / 2017 |
Purchase
and Sale of Fund Shares
Administrator
Class shares are generally available through intermediaries for the
accounts of their customers and directly
to institutional investors and individuals. Institutional investors may include
corporations; private banks and trust
companies; endowments and foundations; defined contribution, defined benefit and
other employer sponsored
retirement plans; institutional retirement plan platforms; insurance companies;
registered investment advisor
firms; bank trusts; 529 college savings plans; family offices; and funds of
funds, including those managed by Funds
Management. In general, you can buy or sell shares of the Fund online or by
mail, phone or wire, on any day the
New York Stock Exchange (“NYSE”) is open for regular trading. You also may buy
and sell shares through a financial
professional.
|
|
Minimum
Investments |
To
Buy or Sell Shares |
Minimum
Initial Investment Administrator
Class: $1 million (this amount may be reduced or eliminated for
certain
eligible investors)
Minimum
Additional Investment Administrator
Class: None |
Mail:
Wells Fargo Funds P.O.
Box 219967 Kansas
City, MO 64121-9967 Online:
wfam.com Phone
or Wire:
1-800-222-8222 Contact
your financial professional. |
Tax
Information
Any
distributions you receive from the Fund may be taxable as ordinary income or
capital gains, except when your investment
is in an IRA, 401(k) or other tax-advantaged investment plan. However,
subsequent withdrawals from such a
tax-advantaged investment plan may be subject to federal income tax. You should
consult your tax adviser about your
specific tax situation.
Payments
to Intermediaries
If you
purchase a Fund through an intermediary, the Fund and its related companies may
pay the intermediary for the sale
of Fund shares and related services. These payments may create a conflict of
interest by influencing the intermediary
and your financial professional to recommend the Fund over another investment.
Consult your financial
professional or visit your intermediary’s website for more
information.
High
Yield Bond Fund Summary
Investment
Objective
The
Fund seeks total return, consisting of a high level of current income and
capital appreciation.
Fees
and Expenses
These
tables are intended to help you understand the various costs and expenses you
will pay if you buy and hold shares of
the Fund.
|
|
Shareholder
Fees (fees paid directly from your investment)
|
|
Maximum
sales charge (load) imposed on purchases (as a percentage of offering
price) |
None |
Maximum
deferred sales charge (load) (as a percentage of offering
price) |
None |
|
|
|
Management
Fees |
0.55% |
Distribution
(12b-1) Fees |
0.00% |
Other
Expenses |
0.43% |
Total
Annual Fund Operating Expenses |
0.98% |
Fee
Waivers |
(0.18)% |
Total
Annual Fund Operating Expenses After Fee Waivers2
|
% |
1. |
Expenses
have been adjusted as necessary from amounts incurred during the Fund’s
most recent fiscal year to reflect current fees and expenses.
|
2. |
The
Manager has contractually committed through December
31, 2021, to
waive fees and/or reimburse expenses to the extent necessary to
cap Total Annual Fund Operating Expenses After Fee Waiver at 0.80%
for Administrator
Class. Brokerage commissions, stamp duty fees, interest,
taxes, acquired fund fees and expenses (if any), and extraordinary
expenses are excluded from the expense cap. Prior to or after the
commitment
expiration date, the cap may be increased or the commitment to maintain
the cap may be terminated only with the approval of
the Board of Trustees. |
Example
of Expenses
The
example below is intended to help you compare the costs of investing in the Fund
with the costs of investing in other
funds. The example assumes a $10,000 initial investment, 5% annual total return,
and that fees and expenses
remain the same as in the tables above. To the extent that the Manager is
waiving fees or reimbursing expenses,
the example assumes that such waiver or reimbursement will only be in place
through the date noted above.
Although your actual costs may be higher or lower, based on these assumptions,
your costs would be:
|
|
After:
|
|
1
Year |
$82 |
3
Years |
$294 |
5
Years |
$524 |
10
Years |
$1,185 |
Portfolio
Turnover
The Fund
pays transaction costs, such as commissions, when it buys and sells securities
(or “turns over” its portfolio).
A higher portfolio turnover rate may indicate higher transaction costs and may
result in higher taxes when Fund
shares are held in a taxable account. These costs, which are not reflected in
annual fund operating expenses
or in the example, affect the Fund’s performance. During the most recent fiscal
year, the Fund’s portfolio turnover
rate was 34% of the
average value of its portfolio.
Principal
Investment Strategies
Under
normal circumstances, we invest:
■ |
at
least 80% of the Fund’s net assets in debt securities that are
below-investment grade;
and |
■ |
up to
10% of the Fund’s total assets in equity securities, including common and
preferred
stocks. |
We invest
principally in below investment-grade debt securities (often called “high yield”
securities or “junk bonds”) of
corporate issuers. These include traditional corporate bonds as well as
convertible bonds. These securities
may have fixed, floating or variable rates. We may invest in below
investment-grade debt securities of any credit
quality. The average credit quality of the Fund’s portfolio is expected to be
equivalent to B or higher based on
the credit ratings assigned to underlying securities by Moody’s, Standard &
Poor’s, from other Nationally Recognized
Statistical Ratings Organizations, or our credit quality assessment of the
underlying securities. We do not manage
the Fund’s portfolio to a specific maturity or duration. We may also use futures
for duration and yield curve
management. We may invest up to 10% of the Fund’s total assets in equity
securities, including common and
preferred stocks. For equity securities, we seek out dividend yielding
securities of companies that we believe have
strong fundamental attributes. We may invest in equity securities of companies
of any size.
Securities
in the Fund’s portfolio may be issued by domestic or foreign issuers (including
foreign governments), and may
include securities of emerging markets
issuers.
We start
our investment process by looking at macroeconomic factors, such as the pace of
economic growth, employment
conditions, corporate profits, inflation rates, monetary and fiscal policy,
within the context of other even
broader factors, including the influence of international economic and financial
conditions. This top-down, macroeconomic
outlook helps us to determine the sectors and industries in which we believe the
portfolio should invest,
and in what proportions. We then seek those industries within this macroeconomic
environment which we find
attractive - industries that are either growing at or above the rate of economic
growth (growth industries) or out of
favor industries with potentially improving outlooks (value industries.) Within
those industries, we prefer companies
with sustainable competitive advantages and high barriers to entry, and we
specifically seek companies with
strong management teams and financial
flexibility.
We
regularly review the investments of the portfolio and may sell a portfolio
holding when it has achieved its valuation
target, there is deterioration in the underlying fundamentals of the business,
or we have identified a more
attractive investment opportunity.
Principal
Investment Risks
An
investment in the Fund may lose money, is
not a deposit of Wells Fargo Bank, N.A. or its affiliates, is not insured
or
guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency, and is
primarily subject to
the risks briefly summarized below.
Market
Risk. The
values of, and/or the income generated by, securities held by the Fund may
decline due to general
market conditions or other factors, including those directly involving the
issuers of such securities. Securities
markets are volatile and may decline significantly in response to adverse
issuer, regulatory, political, or economic
developments. Different sectors of the market and different security types may
react differently to such
developments.
Debt
Securities Risk. Debt
securities are subject to credit risk and interest rate risk. Credit risk is the
possibility that the
issuer or guarantor of a debt security may be unable, or perceived to be unable,
to pay interest or repay principal
when they become due. In these instances, the value of an investment could
decline and the Fund could lose
money. Credit risk increases as an issuer’s credit quality or financial strength
declines. Interest rate risk is the possibility
that interest rates will change over time. When interest rates rise, the value
of debt securities tends to fall. The
longer the terms of the debt securities held by a Fund, the more the Fund is
subject to this risk. If interest rates
decline, interest that the Fund is able to earn on its investments in debt
securities may also decline, which could
cause the Fund to reduce the dividends it pays to shareholders, but the value of
those securities may increase.
Very low or negative interest rates may magnify interest rate
risk.
High
Yield Securities Risk. High
yield securities and unrated securities of similar credit quality (commonly
known as “junk
bonds”) have a much greater risk of default or of not returning principal and
their values tend to be more volatile
than higher-rated securities with similar
maturities.
Convertible
Securities Risk. A
convertible security has characteristics of both equity and debt securities and,
as a result, is
exposed to risks that are typically associated with both types of securities.
The market value of a
convertible
security tends to decline as interest rates increase but also tends to reflect
changes in the market price of the
common stock of the issuing company.
Derivatives
Risk. The use
of derivatives, such as futures, options and swap agreements, can lead to
losses, including
those magnified by leverage, particularly when derivatives are used to enhance
return rather than mitigate
risk. Certain derivative instruments may be difficult to sell when the portfolio
manager believes it would be
appropriate to do so, or the other party to a derivative contract may be
unwilling or unable to fulfill its contractual
obligations.
Emerging
Markets Risk. Emerging
market securities typically present even greater exposure to the risks
described
under “Foreign Investment Risk” and may be particularly sensitive to global
economic conditions. Emerging
market securities are also typically less liquid than securities of developed
countries and could be difficult
to sell, particularly during a market
downturn.
Equity
Securities Risk. The
values of equity securities may experience periods of substantial price
volatility and may
decline significantly over short time periods. In general, the values of equity
securities are more volatile than those of
debt securities. Equity securities fluctuate in value and price in response to
factors specific to the issuer of the
security, such as management performance, financial condition, and market demand
for the issuer’s products or
services, as well as factors unrelated to the fundamental condition of the
issuer, including general market, economic
and political conditions. Different parts of a market, industry and sector may
react differently to adverse issuer,
market, regulatory, political, and economic
developments.
Foreign
Investment Risk. Foreign
investments may be subject to lower liquidity, greater price volatility and
risks related to
adverse political, regulatory, market or economic developments. Foreign
investments may involve exposure
to changes in foreign currency exchange rates and may be subject to higher
withholding and other taxes.
Futures
Contracts Risk. A Fund
that uses futures contracts, which are a type of derivative, is subject to the
risk of loss
caused by unanticipated market movements. In addition, there may at times be an
imperfect correlation between
the movement in the prices of futures contracts and the value of their
underlying instruments or indexes, and there
may at times not be a liquid secondary market for certain futures
contracts.
Growth/Value
Investing Risk.
Securities that exhibit growth or value characteristics tend to perform
differently and shift
into and out of favor with investors depending on changes in market and economic
sentiment and conditions.
Management
Risk.
Investment decisions, techniques, analyses or models implemented by a
Fund’s manager or sub-adviser
in seeking to achieve the Fund’s investment objective may not produce expected
returns, may cause the Fund’s
shares to lose value or may cause the Fund to underperform other funds with
similar investment objectives.
Performance
The
following information provides some indication of the risks of investing in the
Fund by showing changes in the Fund’s
performance from year to year. The
Fund’s average annual total returns are compared to the performance of one or
more indices. Past
performance before and after taxes is no guarantee of future
results. Current
month-end
performance is available on the Fund’s website at wfam.com.
|
|
|
Calendar
Year Total Returns for Administrator Class as of 12/31 each
year1
|
|
Highest
Quarter: March
31, 2019
|
+7.77%
|
Lowest
Quarter: December
31, 2018
|
-5.32%
|
Year-to-date
total return
as of September
30, 2020 is
+0.65%
|
|
|
|
|
|
|
|
|
Inception
Date
of Share
Class |
1
Year |
5
Year |
10
Year |
Administrator
Class (before taxes) |
4/14/1998
|
15.36% |
5.32% |
6.69% |
Administrator
Class (after taxes on distributions) |
4/14/1998
|
13.33% |
3.39% |
4.53% |
Administrator
Class (after taxes on distributions and the
sale of Fund Shares) |
4/14/1998
|
9.03% |
3.19% |
4.27% |
ICE
BofA U.S. High Yield Constrained Index (reflects no deduction
for fees, expenses, or taxes) |
|
14.41% |
6.14% |
7.48% |
1. |
Historical
performance shown prior to July 12, 2010 is based on the performance of
the Fund’s predecessor, Evergreen High Income
Fund. |
After-tax
returns are calculated using the historical highest individual federal marginal
income tax rates and do not reflect
the impact of state, local or foreign taxes.
Actual
after-tax returns depend on an investor’s tax situation and may
differ from those shown, and after-tax returns shown are not relevant to
tax-exempt investors or investors
who hold their Fund shares through tax-deferred arrangements, such as 401(k)
Plans or Individual Retirement
Accounts.
Fund
Management
|
|
|
Manager |
Sub-Adviser |
Portfolio
Manager, Title/Managed Since |
Wells
Fargo Funds Management, LLC |
Wells
Capital Management Incorporated |
Robert
Junkin,
Portfolio Manager / 2019 Margaret
D. Patel,
Portfolio Manager / 2012 |
Purchase
and Sale of Fund Shares
Administrator
Class shares are generally available through intermediaries for the
accounts of their customers and directly
to institutional investors and individuals. Institutional investors may include
corporations; private banks and trust
companies; endowments and foundations; defined contribution, defined benefit and
other employer sponsored
retirement plans; institutional retirement plan platforms; insurance companies;
registered investment advisor
firms; bank trusts; 529 college savings plans; family offices; and funds of
funds, including those managed by Funds
Management. In general, you can buy or sell shares of the Fund online or by
mail, phone or wire, on any day the
New York Stock Exchange (“NYSE”) is open for regular trading. You also may buy
and sell shares through a financial
professional.
|
|
Minimum
Investments |
To
Buy or Sell Shares |
Minimum
Initial Investment Administrator
Class: $1 million (this amount may be reduced or eliminated for
certain
eligible investors)
Minimum
Additional Investment Administrator
Class: None |
Mail:
Wells Fargo Funds P.O.
Box 219967 Kansas
City, MO 64121-9967 Online:
wfam.com Phone
or Wire:
1-800-222-8222 Contact
your financial professional. |
Tax
Information
Any
distributions you receive from the Fund may be taxable as ordinary income or
capital gains, except when your investment
is in an IRA, 401(k) or other tax-advantaged investment plan. However,
subsequent withdrawals from such a
tax-advantaged investment plan may be subject to federal income tax. You should
consult your tax adviser about your
specific tax situation.
Payments
to Intermediaries
If you
purchase a Fund through an intermediary, the Fund and its related companies may
pay the intermediary for the sale
of Fund shares and related services. These payments may create a conflict of
interest by influencing the intermediary
and your financial professional to recommend the Fund over another investment.
Consult your financial
professional or visit your intermediary’s website for more
information.
Short
Duration Government Bond Fund Summary
Investment
Objective
The Fund
seeks to provide current income consistent with capital
preservation.
Fees
and Expenses
These
tables are intended to help you understand the various costs and expenses you
will pay if you buy and hold shares of
the Fund.
|
|
Shareholder
Fees (fees paid directly from your investment)
|
|
Maximum
sales charge (load) imposed on purchases (as a percentage of offering
price) |
None |
Maximum
deferred sales charge (load) (as a percentage of offering
price) |
None |
|
|
Annual
Fund Operating Expenses (expenses that you pay each year as a percentage
of the value of your investment) |
Management
Fees |
0.35% |
Distribution
(12b-1) Fees |
0.00% |
Other
Expenses |
0.40% |
Total
Annual Fund Operating Expenses |
0.75% |
Fee
Waivers |
(0.15)% |
Total
Annual Fund Operating Expenses After Fee Waivers1
|
% |
1. |
The
Manager has contractually committed through December
31, 2021, to
waive fees and/or reimburse expenses to the extent necessary to
cap Total Annual Fund Operating Expenses After Fee Waiver at 0.60%
for Administrator
Class. Brokerage commissions, stamp duty fees, interest,
taxes, acquired fund fees and expenses (if any), and extraordinary
expenses are excluded from the expense cap. Prior to or after the
commitment
expiration date, the cap may be increased or the commitment to maintain
the cap may be terminated only with the approval of
the Board of Trustees. |
Example
of Expenses
The
example below is intended to help you compare the costs of investing in the Fund
with the costs of investing in other
funds. The example assumes a $10,000 initial investment, 5% annual total return,
and that fees and expenses
remain the same as in the tables above. To the extent that the Manager is
waiving fees or reimbursing expenses,
the example assumes that such waiver or reimbursement will only be in place
through the date noted above.
Although your actual costs may be higher or lower, based on these assumptions,
your costs would be:
|
|
After:
|
|
1
Year |
$61 |
3
Years |
$225 |
5
Years |
$402 |
10
Years |
$916 |
Portfolio
Turnover
The Fund
pays transaction costs, such as commissions, when it buys and sells securities
(or “turns over” its portfolio).
A higher portfolio turnover rate may indicate higher transaction costs and may
result in higher taxes when Fund
shares are held in a taxable account. These costs, which are not reflected in
annual fund operating expenses
or in the example, affect the Fund’s performance. During the most recent fiscal
year, the Fund’s portfolio turnover
rate was 395% of the
average value of its portfolio.
Principal
Investment Strategies
Under
normal circumstances, we invest:
■ |
at
least 80% of the Fund’s net assets in U.S. Government obligations;
and |
■ |
up to
20% of the Fund’s net assets in non-government mortgage- and asset-backed
securities. |
We invest
principally in U.S. Government obligations, including debt securities issued or
guaranteed by the U.S. Treasury,
U.S. Government agencies or government-sponsored entities. We will purchase only
securities that are rated, at
the time of purchase, within the two highest rating categories assigned by a
Nationally Recognized Statistical
Ratings Organization, or are deemed by us to be of comparable quality. As part
of our investment strategy,
we may enter into mortgage dollar rolls. While we may purchase securities
of any maturity or duration, under
normal circumstances, we expect the portfolio’s overall dollar-weighted average
effective duration to be less than
that of a 3-year U.S. Treasury note. “Dollar-Weighted Average Effective
Duration” is an aggregate measure of
the sensitivity of a fund’s fixed income portfolio securities to changes in
interest rates. As a general matter,
the price of a fixed income security with a longer effective duration will
fluctuate more in response to changes in
interest rates than the price of a fixed income security with a shorter
effective duration.
We invest
in debt securities that we believe offer competitive returns and are
undervalued, offering additional income
and/or price appreciation potential, relative to other debt securities of
similar credit quality and interest rate
sensitivity. As part of our investment strategy, we invest in mortgage-backed
securities guaranteed by U.S. Government
agencies that we believe will sufficiently outperform U.S. Treasuries. We may
sell a security that has achieved
its desired return or if we believe the security or its sector has become
overvalued. We may also sell a security
if a more attractive opportunity becomes available or if the security is no
longer attractive due to its risk profile or
as a result of changes in the overall market
environment.
Principal
Investment Risks
An
investment in the Fund may lose money, is
not a deposit of Wells Fargo Bank, N.A. or its affiliates, is not insured
or
guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency, and is
primarily subject to
the risks briefly summarized below.
Market
Risk. The
values of, and/or the income generated by, securities held by the Fund may
decline due to general
market conditions or other factors, including those directly involving the
issuers of such securities. Securities
markets are volatile and may decline significantly in response to adverse
issuer, regulatory, political, or economic
developments. Different sectors of the market and different security types may
react differently to such
developments.
Debt
Securities Risk. Debt
securities are subject to credit risk and interest rate risk. Credit risk is the
possibility that the
issuer or guarantor of a debt security may be unable, or perceived to be unable,
to pay interest or repay principal
when they become due. In these instances, the value of an investment could
decline and the Fund could lose
money. Credit risk increases as an issuer’s credit quality or financial strength
declines. Interest rate risk is the possibility
that interest rates will change over time. When interest rates rise, the value
of debt securities tends to fall. The
longer the terms of the debt securities held by a Fund, the more the Fund is
subject to this risk. If interest rates
decline, interest that the Fund is able to earn on its investments in debt
securities may also decline, which could
cause the Fund to reduce the dividends it pays to shareholders, but the value of
those securities may increase.
Very low or negative interest rates may magnify interest rate
risk.
U.S.
Government Obligations Risk. U.S.
Government obligations may be adversely impacted by changes in interest
rates, and securities issued or guaranteed by U.S. Government agencies or
government-sponsored entities
may not be backed by the full faith and credit of the U.S.
Government.
Management
Risk.
Investment decisions, techniques, analyses or models implemented by a
Fund’s manager or sub-adviser
in seeking to achieve the Fund’s investment objective may not produce expected
returns, may cause the Fund’s
shares to lose value or may cause the Fund to underperform other funds with
similar investment objectives.
Mortgage-
and Asset-Backed Securities Risk. Mortgage-
and asset-backed securities may decline in value and become
less liquid when defaults on the underlying mortgages or assets occur and may
exhibit additional volatility in periods
of rising interest rates. Rising interest rates tend to extend the duration of
these securities, making them more
sensitive to changes in interest rates than instruments with fixed payment
schedules. When interest rates
decline or are low, the prepayment of mortgages or assets underlying such
securities can reduce a Fund’s returns.
Performance
The
following information provides some indication of the risks of investing in the
Fund by showing changes in the Fund’s
performance from year to year. The
Fund’s average annual total returns are compared to the performance of one or
more indices. Past
performance before and after taxes is no guarantee of future
results. Current
month-end
performance is available on the Fund’s website at wfam.com.
|
|
|
Calendar
Year Total Returns for Administrator Class as of 12/31 each
year |
|
Highest
Quarter: June
30, 2019
|
+1.39%
|
Lowest
Quarter: December
31, 2016
|
-0.56%
|
Year-to-date
total return
as of September
30, 2020 is
+3.30%
|
|
|
|
|
|
|
Average
Annual Total Returns for the periods ended
12/31/2019 |
|
Inception
Date
of Share
Class |
1
Year |
5
Year |
10
Year |
Administrator
Class (before taxes) |
12/18/1992
|
3.50% |
1.25% |
1.50% |
Administrator
Class (after taxes on distributions) |
12/18/1992
|
2.40% |
0.40% |
0.65% |
Administrator
Class (after taxes on distributions and the
sale of Fund Shares) |
12/18/1992
|
2.06% |
0.57% |
0.80% |
Bloomberg
Barclays U.S. 1-3 Year Government Bond Index
(reflects no deduction for fees, expenses, or taxes)
|
|
3.59% |
1.40% |
1.25% |
After-tax
returns are calculated using the historical highest individual federal marginal
income tax rates and do not reflect
the impact of state, local or foreign taxes.
Actual
after-tax returns depend on an investor’s tax situation and may
differ from those shown, and after-tax returns shown are not relevant to
tax-exempt investors or investors
who hold their Fund shares through tax-deferred arrangements, such as 401(k)
Plans or Individual Retirement
Accounts.
Fund
Management
|
|
|
Manager
|
Sub-Adviser |
Portfolio
Manager, Title/Managed Since |
Wells
Fargo Funds Management,
LLC |
Wells
Capital Management Incorporated |
Maulik
Bhansali, CFA,
Portfolio Manager/2017 Jarad
Vasquez,
Portfolio Manager/2017 |
Purchase
and Sale of Fund Shares
Administrator
Class shares are generally available through intermediaries for the
accounts of their customers and directly
to institutional investors and individuals. Institutional investors may include
corporations; private banks and trust
companies; endowments and foundations; defined contribution, defined benefit and
other employer sponsored
retirement plans; institutional retirement plan platforms; insurance companies;
registered investment advisor
firms; bank trusts; 529 college savings plans; family offices; and funds of
funds, including those managed by Funds
Management. In general, you can buy or sell shares of the Fund online or by
mail, phone or wire, on any day the
New York Stock Exchange (“NYSE”) is open for regular trading. You also may buy
and sell shares through a financial
professional.
|
|
Minimum
Investments |
To
Buy or Sell Shares |
Minimum
Initial Investment Administrator
Class: $1 million (this amount may be reduced or eliminated for
certain
eligible investors)
Minimum
Additional Investment Administrator
Class: None |
Mail:
Wells Fargo Funds P.O.
Box 219967 Kansas
City, MO 64121-9967 Online:
wfam.com Phone
or Wire:
1-800-222-8222 Contact
your financial professional. |
Tax
Information
Any
distributions you receive from the Fund may be taxable as ordinary income or
capital gains, except when your investment
is in an IRA, 401(k) or other tax-advantaged investment plan. However,
subsequent withdrawals from such a
tax-advantaged investment plan may be subject to federal income tax. You should
consult your tax adviser about your
specific tax situation.
Payments
to Intermediaries
If you
purchase a Fund through an intermediary, the Fund and its related companies may
pay the intermediary for the sale
of Fund shares and related services. These payments may create a conflict of
interest by influencing the intermediary
and your financial professional to recommend the Fund over another investment.
Consult your financial
professional or visit your intermediary’s website for more
information.
Short-Term
High Yield Bond Fund Summary
Investment
Objective
The Fund
seeks total return, consisting of a high level of current income and capital
appreciation.
Fees
and Expenses
These
tables are intended to help you understand the various costs and expenses you
will pay if you buy and hold shares of
the Fund.
|
|
Shareholder
Fees (fees paid directly from your investment)
|
|
Maximum
sales charge (load) imposed on purchases (as a percentage of offering
price) |
None |
Maximum
deferred sales charge (load) (as a percentage of offering
price) |
None |
|
|
Annual
Fund Operating Expenses (expenses that you pay each year as a percentage
of the value of your investment) |
Management
Fees |
0.49% |
Distribution
(12b-1) Fees |
0.00% |
Other
Expenses |
0.39% |
Acquired
Fund Fees and Expenses |
0.01% |
Total
Annual Fund Operating Expenses |
0.89% |
Fee
Waivers |
(0.23)% |
Total
Annual Fund Operating Expenses After Fee Waivers1
|
% |
1. |
The
Manager has contractually committed through December
31, 2021, to
waive fees and/or reimburse expenses to the extent necessary to
cap Total Annual Fund Operating Expenses After Fee Waiver at 0.65%
for Administrator
Class. Brokerage commissions, stamp duty fees, interest,
taxes, acquired fund fees and expenses (if any), and extraordinary
expenses are excluded from the expense cap. Prior to or after the
commitment
expiration date, the cap may be increased or the commitment to maintain
the cap may be terminated only with the approval of
the Board of Trustees. |
Example
of Expenses
The
example below is intended to help you compare the costs of investing in the Fund
with the costs of investing in other
funds. The example assumes a $10,000 initial investment, 5% annual total return,
and that fees and expenses
remain the same as in the tables above. To the extent that the Manager is
waiving fees or reimbursing expenses,
the example assumes that such waiver or reimbursement will only be in place
through the date noted above.
Although your actual costs may be higher or lower, based on these assumptions,
your costs would be:
|
|
After:
|
|
1
Year |
$67 |
3
Years |
$261 |
5
Years |
$471 |
10
Years |
$1,075 |
Portfolio
Turnover
The Fund
pays transaction costs, such as commissions, when it buys and sells securities
(or “turns over” its portfolio).
A higher portfolio turnover rate may indicate higher transaction costs and may
result in higher taxes when Fund
shares are held in a taxable account. These costs, which are not reflected in
annual fund operating expenses
or in the example, affect the Fund’s performance. During the most recent fiscal
year, the Fund’s portfolio turnover
rate was 78% of the
average value of its portfolio.
Principal
Investment Strategies
Under
normal circumstances, we invest:
■ |
at
least 80% of the Fund’s net assets in below investment-grade corporate
debt securities;
and |
■ |
up to
25% of the Fund’s total assets in U.S. dollar-denominated debt securities
of foreign
issuers. |
We invest
principally in below investment-grade debt securities (often called “high-yield”
securities or “junk bonds”) of
corporate issuers. These include traditional corporate bonds as well as bank
loans. These securities may have
fixed, floating or variable rates. As part of our below investment-grade debt
securities investment strategy, we will
generally invest in securities that are rated BB through CCC by Standard &
Poor’s or Ba through Caa by Moody’s,
or an equivalent quality rating from another Nationally Recognized Statistical
Ratings Organization, or are deemed
by us to be of comparable quality. We may also use credit default swap
agreements to reduce cash positions
and to cost-effectively increase credit exposure, and futures to manage duration
exposure. While we may
purchase securities of any maturity, under normal circumstances, we expect the
Fund’s dollar-weighted average
effective maturity to be three years or less. “Dollar-Weighted Average Effective
Maturity” is a measure of the
average time until the final payment of principal and interest is due on fixed
income securities in the Fund’s portfolio.
We start
our investment process with a focus on bottom-up fundamental credit
analysis to generate new ideas, to understand
the potential risks, to select individual securities that may potentially add
value from income and/or capital
appreciation. Our credit research may include an assessment of an issuer’s
general financial condition, its competitive
positioning and management strength, as well as industry characteristics and
other factors. We may sell a
security due to changes in credit characteristics or outlook, as well as changes
in portfolio strategy or cash flow
needs. A security may also be sold and replaced with one that presents a better
value or risk/reward profile.
Principal
Investment Risks
An
investment in the Fund may lose money, is
not a deposit of Wells Fargo Bank, N.A. or its affiliates, is not insured
or
guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency, and is
primarily subject to
the risks briefly summarized below.
Market
Risk. The
values of, and/or the income generated by, securities held by the Fund may
decline due to general
market conditions or other factors, including those directly involving the
issuers of such securities. Securities
markets are volatile and may decline significantly in response to adverse
issuer, regulatory, political, or economic
developments. Different sectors of the market and different security types may
react differently to such
developments.
Debt
Securities Risk. Debt
securities are subject to credit risk and interest rate risk. Credit risk is the
possibility that the
issuer or guarantor of a debt security may be unable, or perceived to be unable,
to pay interest or repay principal
when they become due. In these instances, the value of an investment could
decline and the Fund could lose
money. Credit risk increases as an issuer’s credit quality or financial strength
declines. Interest rate risk is the possibility
that interest rates will change over time. When interest rates rise, the value
of debt securities tends to fall. The
longer the terms of the debt securities held by a Fund, the more the Fund is
subject to this risk. If interest rates
decline, interest that the Fund is able to earn on its investments in debt
securities may also decline, which could
cause the Fund to reduce the dividends it pays to shareholders, but the value of
those securities may increase.
Very low or negative interest rates may magnify interest rate
risk.
High
Yield Securities Risk. High
yield securities and unrated securities of similar credit quality (commonly
known as “junk
bonds”) have a much greater risk of default or of not returning principal and
their values tend to be more volatile
than higher-rated securities with similar
maturities.
Derivatives
Risk. The use
of derivatives, such as futures, options and swap agreements, can lead to
losses, including
those magnified by leverage, particularly when derivatives are used to enhance
return rather than mitigate
risk. Certain derivative instruments may be difficult to sell when the portfolio
manager believes it would be
appropriate to do so, or the other party to a derivative contract may be
unwilling or unable to fulfill its contractual
obligations.
Foreign
Investment Risk. Foreign
investments may be subject to lower liquidity, greater price volatility and
risks related to
adverse political, regulatory, market or economic developments. Foreign
investments may involve exposure
to changes in foreign currency exchange rates and may be subject to higher
withholding and other taxes.
Futures
Contracts Risk. A Fund
that uses futures contracts, which are a type of derivative, is subject to the
risk of loss
caused by unanticipated market movements. In addition, there may at times be an
imperfect correlation
between
the movement in the prices of futures contracts and the value of their
underlying instruments or indexes, and there
may at times not be a liquid secondary market for certain futures
contracts.
Loan
Risk. Loans may
be unrated, less liquid and more difficult to value than traditional debt
securities. The highly leveraged
capital structure of the borrowers in such transactions may make such loans
especially vulnerable to adverse
changes in financial, economic or market conditions. A Fund may be unable to
sell loans at a desired time or price.
The Fund may also not be able to control amendments, waivers or the exercise of
any remedies that a lender
would have under a direct loan and may assume liability as a
lender.
Management
Risk.
Investment decisions, techniques, analyses or models implemented by a
Fund’s manager or sub-adviser
in seeking to achieve the Fund’s investment objective may not produce expected
returns, may cause the Fund’s
shares to lose value or may cause the Fund to underperform other funds with
similar investment objectives.
Swaps
Risk.
Depending on their structure, swap agreements and options to enter into swap
agreements (“swaptions”),
both of which are types of derivatives, may increase or decrease a Fund’s
exposure to long- or short-term
interest rates, foreign currency values, mortgage-backed securities, corporate
borrowing rates, or credit
events or other reference points such as security prices or inflation
rates.
Performance
The
following information provides some indication of the risks of investing in the
Fund by showing changes in the Fund’s
performance from year to year. The
Fund’s average annual total returns are compared to the performance of one or
more indices. Past
performance before and after taxes is no guarantee of future
results. Current
month-end
performance is available on the Fund’s website at wfam.com.
|
|
|
Calendar
Year Total Returns for Administrator Class as of 12/31 each
year1
|
|
Highest
Quarter: December
31, 2011
|
+3.46%
|
Lowest
Quarter: September
30, 2011
|
-1.99%
|
Year-to-date
total return
as of September
30, 2020 is
+1.95%
|
|
|
|
|
|
|
|
|
Inception
Date
of Share
Class |
1
Year |
5
Year |
10
Year |
Administrator
Class (before taxes) |
7/30/2010
|
6.80% |
3.34% |
3.82% |
Administrator
Class (after taxes on distributions) |
7/30/2010
|
5.31% |
1.95% |
2.28% |
Administrator
Class (after taxes on distributions and the
sale of Fund Shares) |
7/30/2010
|
4.01% |
1.93% |
2.29% |
ICE
BofA High Yield U.S. Corporates, Cash Pay, BB Rated,
1-5 Year Index (reflects no deduction for fees, expenses,
or taxes) |
|
10.94% |
5.09% |
6.38% |
1. |
Historical
performance shown for the Administrator Class shares prior to their
inception reflects the performance of the Class A shares and includes
the higher expenses applicable to the Class A shares. If these expenses
had not been included, returns for the Administrator Class shares
would be higher. |
After-tax
returns are calculated using the historical highest individual federal marginal
income tax rates and do not reflect
the impact of state, local or foreign taxes.
Actual
after-tax returns depend on an investor’s tax situation and may
differ from those shown, and after-tax returns shown are not relevant to
tax-exempt investors or investors
who hold their Fund shares through tax-deferred arrangements, such as 401(k)
Plans or Individual Retirement
Accounts.
Fund
Management
|
|
|
Manager |
Sub-Adviser |
Portfolio
Manager, Title/Managed Since |
Wells
Fargo Funds Management, LLC |
Wells
Capital Management Incorporated |
Chris
Lee, CFA,
Portfolio Manager / 2020 Michael
J. Schueller,
CFA,
Portfolio Manager
/ 2007
|
Purchase
and Sale of Fund Shares
Administrator
Class shares are generally available through intermediaries for the
accounts of their customers and directly
to institutional investors and individuals. Institutional investors may include
corporations; private banks and trust
companies; endowments and foundations; defined contribution, defined benefit and
other employer sponsored
retirement plans; institutional retirement plan platforms; insurance companies;
registered investment advisor
firms; bank trusts; 529 college savings plans; family offices; and funds of
funds, including those managed by Funds
Management. In general, you can buy or sell shares of the Fund online or by
mail, phone or wire, on any day the
New York Stock Exchange (“NYSE”) is open for regular trading. You also may buy
and sell shares through a financial
professional.
|
|
Minimum
Investments |
To
Buy or Sell Shares |
Minimum
Initial Investment Administrator
Class: $1 million (this amount may be reduced or eliminated for
certain
eligible investors)
Minimum
Additional Investment Administrator
Class: None |
Mail:
Wells Fargo Funds P.O.
Box 219967 Kansas
City, MO 64121-9967 Online:
wfam.com Phone
or Wire:
1-800-222-8222 Contact
your financial professional. |
Tax
Information
Any
distributions you receive from the Fund may be taxable as ordinary income or
capital gains, except when your investment
is in an IRA, 401(k) or other tax-advantaged investment plan. However,
subsequent withdrawals from such a
tax-advantaged investment plan may be subject to federal income tax. You should
consult your tax adviser about your
specific tax situation.
Payments
to Intermediaries
If you
purchase a Fund through an intermediary, the Fund and its related companies may
pay the intermediary for the sale
of Fund shares and related services. These payments may create a conflict of
interest by influencing the intermediary
and your financial professional to recommend the Fund over another investment.
Consult your financial
professional or visit your intermediary’s website for more
information.
Ultra
Short-Term Income Fund Summary
Investment
Objective
The Fund
seeks current income consistent with capital
preservation.
Fees
and Expenses
These
tables are intended to help you understand the various costs and expenses you
will pay if you buy and hold shares of
the Fund.
|
|
Shareholder
Fees (fees paid directly from your investment)
|
|
Maximum
sales charge (load) imposed on purchases (as a percentage of offering
price) |
None |
Maximum
deferred sales charge (load) (as a percentage of offering
price) |
None |
|
|
|
Management
Fees |
0.25% |
Distribution
(12b-1) Fees |
0.00% |
Other
Expenses |
0.38% |
Acquired
Fund Fees and Expenses |
0.02% |
Total
Annual Fund Operating Expenses |
0.65% |
Fee
Waivers |
(0.13)% |
Total
Annual Fund Operating Expenses After Fee Waivers2
|
% |
1. |
Expenses
have been adjusted as necessary from amounts incurred during the Fund’s
most recent fiscal year to reflect current fees and expenses.
|
2. |
The
Manager has contractually committed through December
31, 2021, to
waive fees and/or reimburse expenses to the extent necessary to
cap Total Annual Fund Operating Expenses After Fee Waiver at 0.50%
for Administrator
Class. Brokerage commissions, stamp duty fees, interest,
taxes, acquired fund fees and expenses (if any), and extraordinary
expenses are excluded from the expense cap. Prior to or after the
commitment
expiration date, the cap may be increased or the commitment to maintain
the cap may be terminated only with the approval of
the Board of Trustees. |
Example
of Expenses
The
example below is intended to help you compare the costs of investing in the Fund
with the costs of investing in other
funds. The example assumes a $10,000 initial investment, 5% annual total return,
and that fees and expenses
remain the same as in the tables above. To the extent that the Manager is
waiving fees or reimbursing expenses,
the example assumes that such waiver or reimbursement will only be in place
through the date noted above.
Although your actual costs may be higher or lower, based on these assumptions,
your costs would be:
|
|
After:
|
|
1
Year |
$53 |
3
Years |
$195 |
5
Years |
$349 |
10
Years |
$798 |
Portfolio
Turnover
The Fund
pays transaction costs, such as commissions, when it buys and sells securities
(or “turns over” its portfolio).
A higher portfolio turnover rate may indicate higher transaction costs and may
result in higher taxes when Fund
shares are held in a taxable account. These costs, which are not reflected in
annual fund operating expenses
or in the example, affect the Fund’s performance. During the most recent fiscal
year, the Fund’s portfolio turnover
rate was 68% of the
average value of its portfolio.
Principal
Investment Strategies
Under
normal circumstances, we invest:
■ |
at
least 80% of the Fund’s net assets in income-producing debt
securities; |
■ |
up to
25% of the Fund’s total assets in U.S. dollar-denominated debt securities
of foreign issuers;
and |
■ |
up to
15% of the Fund’s total assets in below investment-grade debt
securities. |
We invest
principally in income-producing debt securities. Our portfolio holdings may
include U.S. Government obligations,
corporate debt securities, bank loans and mortgage- and asset-backed debt
securities. These securities
may have fixed, floating or variable rates. We may invest in investment-grade
and below investment-grade
debt securities (often called “high-yield” securities or “junk bonds”), as well
as in debt securities of both
domestic and foreign issuers. As part of our below investment-grade debt
securities investment strategy, we will
generally invest in securities that are rated at least BB by Standard &
Poor’s or Ba by Moody’s, or an equivalent
quality rating from another Nationally Recognized Statistical Ratings
Organization, or are deemed by us to be
of comparable quality. We may also use futures for duration and yield curve
management. While we may purchase
securities of any maturity or duration, under normal circumstances, we expect
the Fund’s dollar-weighted
average effective maturity to be 1.5 years or less and the Fund’s
dollar-weighted average effective
duration to be 1 year or less. “Dollar-Weighted Average Effective Maturity” is a
measure of the average time until
the final payment of principal and interest is due on fixed income securities in
the Fund’s portfolio. “Dollar-Weighted
Average Effective Duration” is an aggregate measure of the sensitivity of a
fund’s fixed income portfolio
securities to changes in interest rates. As a general matter, the price of a
fixed income security with a longer
effective duration will fluctuate more in response to changes in interest rates
than the price of a fixed income
security with a shorter effective duration.
We employ
a top-down, macroeconomic outlook to determine the portfolio’s duration, yield
curve positioning, credit
quality and sector allocation. Macroeconomic factors considered may include,
among others, the pace of economic
growth, employment conditions, corporate profits, inflation, monetary and fiscal
policy, as well as the influence
of international economic and financial conditions. In combination with our
top-down, macroeconomic approach,
we employ a bottom-up process of fundamental securities analysis to select the
specific securities for investment.
Elements of this evaluation may include credit research, duration measurements,
historical yield spread
relationships, volatility trends, mortgage refinance rates, as well as other
factors. Our credit analysis may consider
an issuer’s general financial condition, its competitive position and its
management strategies, as well as industry
characteristics and other factors. We may sell a security due to changes in
credit characteristics or outlook,
as well as changes in portfolio strategy or cash flow needs. A security may also
be sold and replaced with one that
presents a better value or risk/reward
profile.
Principal
Investment Risks
An
investment in the Fund may lose money, is
not a deposit of Wells Fargo Bank, N.A. or its affiliates, is not insured
or
guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency, and is
primarily subject to
the risks briefly summarized below.
Market
Risk. The
values of, and/or the income generated by, securities held by the Fund may
decline due to general
market conditions or other factors, including those directly involving the
issuers of such securities. Securities
markets are volatile and may decline significantly in response to adverse
issuer, regulatory, political, or economic
developments. Different sectors of the market and different security types may
react differently to such
developments.
Debt
Securities Risk. Debt
securities are subject to credit risk and interest rate risk. Credit risk is the
possibility that the
issuer or guarantor of a debt security may be unable, or perceived to be unable,
to pay interest or repay principal
when they become due. In these instances, the value of an investment could
decline and the Fund could lose
money. Credit risk increases as an issuer’s credit quality or financial strength
declines. Interest rate risk is the possibility
that interest rates will change over time. When interest rates rise, the value
of debt securities tends to fall. The
longer the terms of the debt securities held by a Fund, the more the Fund is
subject to this risk. If interest rates
decline, interest that the Fund is able to earn on its investments in debt
securities may also decline, which could
cause the Fund to reduce the dividends it pays to shareholders, but the value of
those securities may increase.
Very low or negative interest rates may magnify interest rate
risk.
Derivatives
Risk. The use
of derivatives, such as futures, options and swap agreements, can lead to
losses, including
those magnified by leverage, particularly when derivatives are used to enhance
return rather than mitigate
risk. Certain derivative instruments may be difficult to sell when the portfolio
manager believes it would
be
appropriate to do so, or the other party to a derivative contract may be
unwilling or unable to fulfill its contractual
obligations.
Foreign
Investment Risk. Foreign
investments may be subject to lower liquidity, greater price volatility and
risks related to
adverse political, regulatory, market or economic developments. Foreign
investments may involve exposure
to changes in foreign currency exchange rates and may be subject to higher
withholding and other taxes.
Futures
Contracts Risk. A Fund
that uses futures contracts, which are a type of derivative, is subject to the
risk of loss
caused by unanticipated market movements. In addition, there may at times be an
imperfect correlation between
the movement in the prices of futures contracts and the value of their
underlying instruments or indexes, and there
may at times not be a liquid secondary market for certain futures
contracts.
High
Yield Securities Risk. High
yield securities and unrated securities of similar credit quality (commonly
known as “junk
bonds”) have a much greater risk of default or of not returning principal and
their values tend to be more volatile
than higher-rated securities with similar
maturities.
Loan
Risk. Loans may
be unrated, less liquid and more difficult to value than traditional debt
securities. The highly leveraged
capital structure of the borrowers in such transactions may make such loans
especially vulnerable to adverse
changes in financial, economic or market conditions. A Fund may be unable to
sell loans at a desired time or price.
The Fund may also not be able to control amendments, waivers or the exercise of
any remedies that a lender
would have under a direct loan and may assume liability as a
lender.
Management
Risk.
Investment decisions, techniques, analyses or models implemented by a
Fund’s manager or sub-adviser
in seeking to achieve the Fund’s investment objective may not produce expected
returns, may cause the Fund’s
shares to lose value or may cause the Fund to underperform other funds with
similar investment objectives.
Mortgage-
and Asset-Backed Securities Risk. Mortgage-
and asset-backed securities may decline in value and become
less liquid when defaults on the underlying mortgages or assets occur and may
exhibit additional volatility in periods
of rising interest rates. Rising interest rates tend to extend the duration of
these securities, making them more
sensitive to changes in interest rates than instruments with fixed payment
schedules. When interest rates
decline or are low, the prepayment of mortgages or assets underlying such
securities can reduce a Fund’s returns.
U.S.
Government Obligations Risk. U.S.
Government obligations may be adversely impacted by changes in interest
rates, and securities issued or guaranteed by U.S. Government agencies or
government-sponsored entities
may not be backed by the full faith and credit of the U.S.
Government.
Performance
The
following information provides some indication of the risks of investing in the
Fund by showing changes in the Fund’s
performance from year to year. The
Fund’s average annual total returns are compared to the performance of one or
more indices. Past
performance before and after taxes is no guarantee of future
results. Current
month-end
performance is available on the Fund’s website at wfam.com.
|
|
|
Calendar
Year Total Returns for Administrator Class as of 12/31 each
year |
|
Highest
Quarter: March
31, 2010
|
+1.64%
|
Lowest
Quarter: September
30, 2011
|
-0.21%
|
Year-to-date
total return
as of September
30, 2020 is
+1.86%
|
|
|
|
|
|
|
Average
Annual Total Returns for the periods ended
12/31/2019 |
|
Inception
Date
of Share
Class |
1
Year |
5
Year |
10
Year |
Administrator
Class (before taxes) |
4/8/2005
|
3.50% |
1.62% |
1.55% |
Administrator
Class (after taxes on distributions) |
4/8/2005
|
2.55% |
1.00% |
1.00% |
Administrator
Class (after taxes on distributions and the
sale of Fund Shares) |
4/8/2005
|
2.06% |
0.96% |
0.96% |
Bloomberg
Barclays Short-Term Government/Corporate
Bond Index (reflects no deduction
for fees, expenses, or taxes) |
|
2.69% |
1.34% |
0.85% |
After-tax
returns are calculated using the historical highest individual federal marginal
income tax rates and do not reflect
the impact of state, local or foreign taxes.
Actual
after-tax returns depend on an investor’s tax situation and may
differ from those shown, and after-tax returns shown are not relevant to
tax-exempt investors or investors
who hold their Fund shares through tax-deferred arrangements, such as 401(k)
Plans or Individual Retirement
Accounts.
Fund
Management
|
|
|
Manager
|
Sub-Adviser |
Portfolio
Manager, Title/Managed Since |
Wells
Fargo Funds Management, LLC |
Wells
Capital Management Incorporated |
Christopher
Y. Kauffman, CFA,
Portfolio Manager
/ 2010 Jay
N. Mueller, CFA,
Portfolio Manager / 2004 Michael
J. Schueller, CFA,
Portfolio Manager
/ 2019 Noah
M. Wise, CFA,
Portfolio Manager / 2013 |
Purchase
and Sale of Fund Shares
Administrator
Class shares are generally available through intermediaries for the
accounts of their customers and directly
to institutional investors and individuals. Institutional investors may include
corporations; private banks and trust
companies; endowments and foundations; defined contribution, defined benefit and
other employer sponsored
retirement plans; institutional retirement plan platforms; insurance companies;
registered investment advisor
firms; bank trusts; 529 college savings plans; family offices; and funds of
funds, including those managed by Funds
Management. In general, you can buy or sell shares of the Fund online or by
mail, phone or wire, on any day the
New York Stock Exchange (“NYSE”) is open for regular trading. You also may buy
and sell shares through a financial
professional.
|
|
Minimum
Investments |
To
Buy or Sell Shares |
Minimum
Initial Investment Administrator
Class: $1 million (this amount may be reduced or eliminated for
certain
eligible investors)
Minimum
Additional Investment Administrator
Class: None |
Mail:
Wells Fargo Funds P.O.
Box 219967 Kansas
City, MO 64121-9967 Online:
wfam.com Phone
or Wire:
1-800-222-8222 Contact
your financial professional. |
Tax
Information
Any
distributions you receive from the Fund may be taxable as ordinary income or
capital gains, except when your investment
is in an IRA, 401(k) or other tax-advantaged investment plan. However,
subsequent withdrawals from such a
tax-advantaged investment plan may be subject to federal income tax. You should
consult your tax adviser about your
specific tax situation.
Payments
to Intermediaries
If you
purchase a Fund through an intermediary, the Fund and its related companies may
pay the intermediary for the sale
of Fund shares and related services. These payments may create a conflict of
interest by influencing the intermediary
and your financial professional to recommend the Fund over another investment.
Consult your financial
professional or visit your intermediary’s website for more
information.
Details
About the Funds
Adjustable
Rate Government Fund
Investment
Objective
The Fund
seeks current income consistent with capital preservation.
The Fund’s
Board of Trustees can change this investment objective without a shareholder
vote.
Principal
Investment Strategies
Under
normal circumstances, we invest:
■ |
at
least 80% of the Fund’s net assets in mortgage-backed and asset-backed
securities issued or guaranteed by U.S.
Government agencies or government-sponsored entities, that have interest
rates that reset at periodic intervals;
and |
■ |
up to
20% of the Fund’s total assets in obligations that pay fixed interest
rates. |
We invest
principally in mortgage-backed securities (including collateralized mortgage
obligations (CMOs)) and asset-backed
securities issued or guaranteed by U.S. Government agencies or
government-sponsored entities. Under
normal circumstances, we expect to maintain an average credit quality rating for
the portfolio equivalent to the
highest rating available from a Nationally Recognized Statistical Ratings
Organization (NRSRO). In the event that a
NRSRO assigns U.S. sovereign debt a rating below its highest rating, we expect
to maintain an average credit
quality rating that is equivalent to the average rating assigned to U.S.
sovereign debt. We may also use futures
for duration and yield curve management. As part of our mortgage-backed
securities investment strategy, we may
enter into dollar roll transactions. Under normal circumstances, the
dollar-weighted average reset period of the
adjustable rate securities held by the Fund will not exceed one
year.
We employ
a top-down, macroeconomic outlook to determine the portfolio’s duration, yield
curve positioning, issuer
selection and sector allocation. Macroeconomic factors considered may include,
among others, the pace of economic
growth, employment conditions, corporate profits, inflation, monetary and fiscal
policy, as well as the influence
of international economic and financial conditions. In combination with our
top-down macroeconomic approach,
we employ a bottom-up process of fundamental securities analysis to select the
specific securities for investment.
Elements of this evaluation may include the effect of changing principal
prepayments, interest rate and yield
spread volatility, and the impact of changes in the level and shape of the yield
curve on a security’s value. We may
sell a security based on how we expect these factors to affect a security’s
value relative to its indicated sales
price as well as changes in portfolio strategy or cash flow needs. A security
may also be sold and replaced with one that
presents a better value or risk/reward profile.
We may
actively trade portfolio securities, which may lead to higher transaction costs
that may affect the Fund’s performance.
In addition, active trading of portfolio securities may lead to higher taxes if
your shares are held in a taxable
account.
The Fund
may hold some of its assets in cash or in money market instruments, including
U.S. Government obligations,
shares of other funds and repurchase agreements, or make other short-term
investments for purposes
of maintaining liquidity or for short-term defensive purposes when we believe it
is in the best interests of the
shareholders to do so. During such periods, the Fund may not achieve its
objective.
Principal
Investment Risks
The Fund
is primarily subject to the risks mentioned below.
These and
other risks could cause you to lose money in your investment in the Fund and
could adversely affect the Fund’s net
asset value, yield and total return. These risks are described in the
“Description of Principal Investment Risks”
section.
Core
Plus Bond Fund
Investment
Objective
The Fund
seeks total return, consisting of current income and capital
appreciation.
The Fund’s
Board of Trustees can change this investment objective without a shareholder
vote.
Principal
Investment Strategies
Under
normal circumstances, we invest:
■ |
at
least 80% of the Fund’s net assets in debt
securities; |
■ |
up to
35% of the Fund’s total assets in debt securities that are below
investment-grade; and |
■ |
up to
25% of the Fund’s total assets in debt securities of foreign issuers,
including emerging markets issuers and debt
securities denominated in foreign
currencies. |
We invest
principally in debt securities, including corporate, mortgage- and asset-backed
securities, bank loans, foreign
sovereign debt, supranational agencies, and U.S. Government obligations. These
securities may have fixed, floating
or variable rates and may include debt securities of both domestic and foreign
issuers. We invest in both investment-grade
and below investment-grade debt securities (often called “high yield” securities
or “junk bonds”),
including unrated securities, as well as securities that are in default at the
time of purchase.
We may
invest in debt securities of foreign issuers, including emerging markets
issuers, denominated in any currency.
We may seek to add yield by having exposures to a variety of credits, mortgages,
and higher yielding countries
and currencies. We may also use futures and swap agreements to manage risk or to
enhance return. We may enter
into currency-related transactions through derivative instruments, including
currency and cross currency
forwards. The use of derivative currency transactions is intended to allow the
Fund to manage, hedge or reduce a
foreign currency-specific risk exposure of a portfolio security or its
denominated currency or to obtain net long
exposure to selected currencies for the purpose of generating income or
additional returns.
While we
may purchase securities of any maturity or duration, under normal circumstances,
we expect to maintain an overall
portfolio dollar-weighted average effective duration that is within 1 year of
that of the Fund’s benchmark.
The Fund’s benchmark, the Bloomberg Barclays U.S. Aggregate Bond Index, had a
duration of 6.23 years, as
of November 30, 2020. “Dollar-Weighted Average Effective Duration” is an
aggregate measure of the sensitivity
of a fund’s fixed income portfolio securities to changes in interest rates. As a
general matter, the price of a fixed
income security with a longer effective duration will fluctuate more in response
to changes in interest rates than
the price of a fixed income security with a shorter effective
duration.
We start
our investment process with a top-down, macroeconomic outlook to determine
portfolio duration and yield
curve positioning as well as industry, sector and credit quality allocations.
Macroeconomic factors considered may
include, among others, the pace of economic growth, employment conditions,
corporate profits, inflation, monetary
and fiscal policy, as well as the influence of international economic and
financial conditions. Within these parameters,
we then apply rigorous credit research to select individual securities that we
believe can add value from
income and/or the potential for capital appreciation. Our credit research may
include an assessment of an issuer’s
general financial condition, its competitive positioning and management
strength, as well as industry characteristics
and other factors. We may sell a security due to changes in credit
characteristics or outlook, as well as changes
in portfolio strategy or cash flow needs. A security may also be sold and
replaced with one that presents a
better value or risk/reward profile.
We may
actively trade portfolio securities, which may lead to higher transaction costs
that may affect the Fund’s performance.
In addition, active trading of portfolio securities may lead to higher taxes if
your shares are held in a taxable
account.
The Fund
may hold some of its assets in cash or in money market instruments, including
U.S. Government obligations,
shares of other funds and repurchase agreements, or make other short-term
investments for purposes
of maintaining liquidity or for short-term defensive purposes when we believe it
is in the best interests of the
shareholders to do so. During such periods, the Fund may not achieve its
objective.
Principal
Investment Risks
The Fund
is primarily subject to the risks mentioned below.
These and
other risks could cause you to lose money in your investment in the Fund and
could adversely affect the Fund’s net
asset value, yield and total return. These risks are described in the
“Description of Principal Investment Risks”
section.
Government
Securities Fund
Investment
Objective
The Fund
seeks current income.
The Fund’s
Board of Trustees can change this investment objective without a shareholder
vote.
Principal
Investment Strategies
Under
normal circumstances, we invest:
■ |
at
least 80% of the Fund’s net assets in U.S. Government obligations and
repurchase agreements collateralized by U.S.
Government obligations; and |
■ |
up to
20% of the Fund’s net assets in non-government investment-grade debt
securities. |
We invest
principally in U.S. Government obligations, including debt securities issued or
guaranteed by the U.S. Treasury,
U.S. Government agencies or government-sponsored entities. These securities may
have fixed, floating or
variable rates and also include mortgage-backed securities. As part of our
mortgage-backed securities investment
strategy, we may enter into dollar rolls. We may also use futures for duration
and yield curve management.
We employ
a top-down, macroeconomic outlook to determine the portfolio’s duration, yield
curve positioning and sector
allocation. Macroeconomic factors considered may include, among others, the pace
of economic growth, employment
conditions, inflation, monetary and fiscal policy, as well as the influence of
international economic and
financial conditions. In combination with our top-down, macroeconomic approach,
we employ a bottom-up process of
fundamental securities analysis to select the specific securities for
investment. Elements of this evaluation
may include duration measurements, historical yield spread relationships,
volatility trends, mortgage refinance
rates, as well as other factors. We may sell a security due to changes in our
outlook, as well as changes in portfolio
strategy or cash flow needs. A security may also be sold and replaced with one
that presents a better value or
risk/reward profile.
We may
actively trade portfolio securities, which may lead to higher transaction costs
that may affect the Fund’s performance.
In addition, active trading of portfolio securities may lead to higher taxes if
your shares are held in a taxable
account.
The Fund
may hold some of its assets in cash or in money market instruments, including
U.S. Government obligations,
shares of other funds and repurchase agreements, or make other short-term
investments for purposes
of maintaining liquidity or for short-term defensive purposes when we believe it
is in the best interests of the
shareholders to do so. During such periods, the Fund may not achieve its
objective.
Principal
Investment Risks
The Fund
is primarily subject to the risks mentioned below.
These and
other risks could cause you to lose money in your investment in the Fund and
could adversely affect the Fund’s net
asset value, yield and total return. These risks are described in the
“Description of Principal Investment Risks”
section.
High
Yield Bond Fund
Investment
Objective
The
Fund seeks total return, consisting of a high level of current income and
capital appreciation.
The Fund’s
Board of Trustees can change this investment objective without a shareholder
vote.
Principal
Investment Strategies
Under
normal circumstances, we invest:
■ |
at
least 80% of the Fund’s net assets in debt securities that are
below-investment grade; and |
■ |
up to
10% of the Fund’s total assets in equity securities, including common and
preferred stocks. |
We invest
principally in below investment-grade debt securities (often called “high yield”
securities or “junk bonds”) of
corporate issuers. These include traditional corporate bonds as well as
convertible bonds. These securities
may have fixed, floating or variable rates. We may invest in below
investment-grade debt securities of any credit
quality. The average credit quality of the Fund’s portfolio is expected to be
equivalent to B or higher based on
the credit ratings assigned to underlying securities by Moody’s, Standard &
Poor’s, from other Nationally Recognized
Statistical Ratings Organizations, or our credit quality assessment of the
underlying securities. We do not manage
the Fund’s portfolio to a specific maturity or duration. We may also use futures
for duration and yield curve
management. We may invest up to 10% of the Fund’s total assets in equity
securities, including common and
preferred stocks. For equity securities, we seek out dividend yielding
securities of companies that we believe have
strong fundamental attributes. We may invest in equity securities of companies
of any size.
Securities
in the Fund’s portfolio may be issued by domestic or foreign issuers (including
foreign governments), and may
include securities of emerging markets issuers.
We start
our investment process by looking at macroeconomic factors, such as the pace of
economic growth, employment
conditions, corporate profits, inflation rates, monetary and fiscal policy,
within the context of other even
broader factors, including the influence of international economic and financial
conditions. This top-down, macroeconomic
outlook helps us to determine the sectors and industries in which we believe the
portfolio should invest,
and in what proportions. We then seek those industries within this macroeconomic
environment which we find
attractive - industries that are either growing at or above the rate of economic
growth (growth industries) or out of
favor industries with potentially improving outlooks (value industries.) Within
those industries, we prefer companies
with sustainable competitive advantages and high barriers to entry, and we
specifically seek companies with
strong management teams and financial flexibility.
We
regularly review the investments of the portfolio and may sell a portfolio
holding when it has achieved its valuation
target, there is deterioration in the underlying fundamentals of the business,
or we have identified a more
attractive investment opportunity.
We may
actively trade portfolio securities, which may lead to higher transaction costs
that may affect the Fund’s performance.
In addition, active trading of portfolio securities may lead to higher taxes if
your shares are held in a taxable
account.
The Fund
may hold some of its assets in cash or in money market instruments, including
U.S. Government obligations,
shares of other funds and repurchase agreements, or make other short-term
investments for purposes
of maintaining liquidity or for short-term defensive purposes when we believe it
is in the best interests of the
shareholders to do so. During such periods, the Fund may not achieve its
objective.
Principal
Investment Risks
The Fund
is primarily subject to the risks mentioned below.
These and
other risks could cause you to lose money in your investment in the Fund and
could adversely affect the Fund’s net
asset value, yield and total return. These risks are described in the
“Description of Principal Investment Risks”
section.
Short
Duration Government Bond Fund
Investment
Objective
The Fund
seeks to provide current income consistent with capital
preservation.
The Fund’s
Board of Trustees can change this investment objective without a shareholder
vote.
Principal
Investment Strategies
Under
normal circumstances, we invest:
■ |
at
least 80% of the Fund’s net assets in U.S. Government obligations;
and |
■ |
up to
20% of the Fund’s net assets in non-government mortgage- and asset-backed
securities. |
We invest
principally in U.S. Government obligations, including debt securities issued or
guaranteed by the U.S. Treasury,
U.S. Government agencies or government-sponsored entities. We will purchase only
securities that are rated, at
the time of purchase, within the two highest rating categories assigned by a
Nationally Recognized Statistical
Ratings Organization, or are deemed by us to be of comparable quality. As part
of our investment strategy,
we may enter into mortgage dollar rolls. While we may purchase securities
of any maturity or duration, under
normal circumstances, we expect the portfolio’s overall dollar-weighted average
effective duration to be less than
that of a 3-year U.S. Treasury note. “Dollar-Weighted Average Effective
Duration” is an aggregate measure of
the sensitivity of a fund’s fixed income portfolio securities to changes in
interest rates. As a general matter,
the price of a fixed income security with a longer effective duration will
fluctuate more in response to changes in
interest rates than the price of a fixed income security with a shorter
effective duration.
We invest
in debt securities that we believe offer competitive returns and are
undervalued, offering additional income
and/or price appreciation potential, relative to other debt securities of
similar credit quality and interest rate
sensitivity. As part of our investment strategy, we invest in mortgage-backed
securities guaranteed by U.S. Government
agencies that we believe will sufficiently outperform U.S. Treasuries. We may
sell a security that has achieved
its desired return or if we believe the security or its sector has become
overvalued. We may also sell a security
if a more attractive opportunity becomes available or if the security is no
longer attractive due to its risk profile or
as a result of changes in the overall market environment.
We may
actively trade portfolio securities, which may lead to higher transaction costs
that may affect the Fund’s performance.
In addition, active trading of portfolio securities may lead to higher taxes if
your shares are held in a taxable
account.
The Fund
may hold some of its assets in cash or in money market instruments, including
U.S. Government obligations,
shares of other funds and repurchase agreements, or make other short-term
investments for purposes
of maintaining liquidity or for short-term defensive purposes when we believe it
is in the best interests of the
shareholders to do so. During such periods, the Fund may not achieve its
objective.
Principal
Investment Risks
The Fund
is primarily subject to the risks mentioned below.
These and
other risks could cause you to lose money in your investment in the Fund and
could adversely affect the Fund’s net
asset value, yield and total return. These risks are described in the
“Description of Principal Investment Risks”
section.
Short-Term
High Yield Bond Fund
Investment
Objective
The Fund
seeks total return, consisting of a high level of current income and capital
appreciation.
The Fund’s
Board of Trustees can change this investment objective without a shareholder
vote.
Principal
Investment Strategies
Under
normal circumstances, we invest:
■ |
at
least 80% of the Fund’s net assets in below investment-grade corporate
debt securities; and |
■ |
up to
25% of the Fund’s total assets in U.S. dollar-denominated debt securities
of foreign issuers. |
We invest
principally in below investment-grade debt securities (often called “high-yield”
securities or “junk bonds”) of
corporate issuers. These include traditional corporate bonds as well as bank
loans. These securities may have
fixed, floating or variable rates. As part of our below investment-grade debt
securities investment strategy, we will
generally invest in securities that are rated BB through CCC by Standard &
Poor’s or Ba through Caa by Moody’s,
or an equivalent quality rating from another Nationally Recognized Statistical
Ratings Organization, or are deemed
by us to be of comparable quality. We may also use credit default swap
agreements to reduce cash positions
and to cost-effectively increase credit exposure, and futures to manage duration
exposure. While we may
purchase securities of any maturity, under normal circumstances, we expect the
Fund’s dollar-weighted average
effective maturity to be three years or less. “Dollar-Weighted Average Effective
Maturity” is a measure of the
average time until the final payment of principal and interest is due on fixed
income securities in the Fund’s portfolio.
We start
our investment process with a focus on bottom-up fundamental credit
analysis to generate new ideas, to understand
the potential risks, to select individual securities that may potentially add
value from income and/or capital
appreciation. Our credit research may include an assessment of an issuer’s
general financial condition, its competitive
positioning and management strength, as well as industry characteristics and
other factors. We may sell a
security due to changes in credit characteristics or outlook, as well as changes
in portfolio strategy or cash flow
needs. A security may also be sold and replaced with one that presents a better
value or risk/reward profile.
We may
actively trade portfolio securities, which may lead to higher transaction costs
that may affect the Fund’s performance.
In addition, active trading of portfolio securities may lead to higher taxes if
your shares are held in a taxable
account.
The Fund
may hold some of its assets in cash or in money market instruments, including
U.S. Government obligations,
shares of other funds and repurchase agreements, or make other short-term
investments for purposes
of maintaining liquidity or for short-term defensive purposes when we believe it
is in the best interests of the
shareholders to do so. During such periods, the Fund may not achieve its
objective.
Principal
Investment Risks
The Fund
is primarily subject to the risks mentioned below.
These and
other risks could cause you to lose money in your investment in the Fund and
could adversely affect the Fund’s net
asset value, yield and total return. These risks are described in the
“Description of Principal Investment Risks”
section.
Ultra
Short-Term Income Fund
Investment
Objective
The Fund
seeks current income consistent with capital preservation.
The Fund’s
Board of Trustees can change this investment objective without a shareholder
vote.
Principal
Investment Strategies
Under
normal circumstances, we invest:
■ |
at
least 80% of the Fund’s net assets in income-producing debt
securities; |
■ |
up to
25% of the Fund’s total assets in U.S. dollar-denominated debt securities
of foreign issuers; and |
■ |
up to
15% of the Fund’s total assets in below investment-grade debt
securities. |
We invest
principally in income-producing debt securities. Our portfolio holdings may
include U.S. Government obligations,
corporate debt securities, bank loans and mortgage- and asset-backed debt
securities. These securities
may have fixed, floating or variable rates. We may invest in investment-grade
and below investment-grade
debt securities (often called “high-yield” securities or “junk bonds”), as well
as in debt securities of both
domestic and foreign issuers. As part of our below investment-grade debt
securities investment strategy, we will
generally invest in securities that are rated at least BB by Standard &
Poor’s or Ba by Moody’s, or an equivalent
quality rating from another Nationally Recognized Statistical Ratings
Organization, or are deemed by us to be
of comparable quality. We may also use futures for duration and yield curve
management. While we may purchase
securities of any maturity or duration, under normal circumstances, we expect
the Fund’s dollar-weighted
average effective maturity to be 1.5 years or less and the Fund’s
dollar-weighted average effective
duration to be 1 year or less. “Dollar-Weighted Average Effective Maturity” is a
measure of the average time until
the final payment of principal and interest is due on fixed income securities in
the Fund’s portfolio. “Dollar-Weighted
Average Effective Duration” is an aggregate measure of the sensitivity of a
fund’s fixed income portfolio
securities to changes in interest rates. As a general matter, the price of a
fixed income security with a longer
effective duration will fluctuate more in response to changes in interest rates
than the price of a fixed income
security with a shorter effective duration.
We employ
a top-down, macroeconomic outlook to determine the portfolio’s duration, yield
curve positioning, credit
quality and sector allocation. Macroeconomic factors considered may include,
among others, the pace of economic
growth, employment conditions, corporate profits, inflation, monetary and fiscal
policy, as well as the influence
of international economic and financial conditions. In combination with our
top-down, macroeconomic approach,
we employ a bottom-up process of fundamental securities analysis to select the
specific securities for investment.
Elements of this evaluation may include credit research, duration measurements,
historical yield spread
relationships, volatility trends, mortgage refinance rates, as well as other
factors. Our credit analysis may consider
an issuer’s general financial condition, its competitive position and its
management strategies, as well as industry
characteristics and other factors. We may sell a security due to changes in
credit characteristics or outlook,
as well as changes in portfolio strategy or cash flow needs. A security may also
be sold and replaced with one that
presents a better value or risk/reward profile.
We may
actively trade portfolio securities, which may lead to higher transaction costs
that may affect the Fund’s performance.
In addition, active trading of portfolio securities may lead to higher taxes if
your shares are held in a taxable
account.
The Fund
may hold some of its assets in cash or in money market instruments, including
U.S. Government obligations,
shares of other funds and repurchase agreements, or make other short-term
investments for purposes
of maintaining liquidity or for short-term defensive purposes when we believe it
is in the best interests of the
shareholders to do so. During such periods, the Fund may not achieve its
objective.
Principal
Investment Risks
The Fund
is primarily subject to the risks mentioned below.
These and
other risks could cause you to lose money in your investment in the Fund and
could adversely affect the Fund’s net
asset value, yield and total return. These risks are described in the
“Description of Principal Investment Risks”
section.
Description
of Principal Investment Risks
Understanding
the risks involved in fund investing will help you make an informed decision
that takes into account your risk
tolerance and preferences. The risks that are most likely to have a material
effect on a particular Fund as
a whole
are called “principal risks.” The principal risks for each Fund have
been previously identified and are described
below (in alphabetical order). Additional information about the principal risks
is included in the Statement
of Additional Information.
Convertible
Securities Risk. A
convertible security has characteristics of both equity and debt securities and,
as a result, is
exposed to risks that are typically associated with both types of securities.
The market value of a convertible
security tends to decline as interest rates increase but also tends to reflect
changes in the market price of the
common stock of the issuing company. A convertible security is also exposed to
the risk that an issuer is unable to
meet its obligation to make dividend or interest and principal payments when due
as a result of changing financial
or market conditions. In the event of a liquidation of the issuer, holders of a
convertible security would generally
be paid only after holders of any senior debt obligations. A Fund may be forced
to convert a convertible security
before it would otherwise choose to do so, which may decrease the Fund’s
return.
Debt
Securities Risk. Debt
securities are subject to credit risk and interest rate risk. Credit risk is the
possibility that the
issuer or guarantor of a debt security may be unable, or perceived to be unable,
to pay interest or repay principal
when they become due. In these instances, the value of an investment could
decline and the Fund could lose
money. Credit risk increases as an issuer’s credit quality or financial strength
declines. The credit quality of a debt
security may deteriorate rapidly and cause significant deterioration in the
Fund’s net asset value. Interest rate risk is
the possibility that interest rates will change over time. When interest rates
rise, the value of debt securities tends to
fall. The longer the terms of the debt securities held by a Fund, the more the
Fund is subject to this risk. If interest
rates decline, interest that the Fund is able to earn on its investments in debt
securities may also decline, which
could cause the Fund to reduce the dividends it pays to shareholders, but the
value of those securities may increase.
Some debt securities give the issuers the option to call, redeem or prepay the
securities before their maturity
dates. If an issuer calls, redeems or prepays a debt security during a time of
declining interest rates, the Fund might
have to reinvest the proceeds in a security offering a lower yield, and
therefore might not benefit from any
increase in value as a result of declining interest rates. Very low or negative
interest rates may magnify interest
rate risk. Changing interest rates, including rates that fall below zero, may
have unpredictable effects on markets,
may result in heightened market volatility and may detract from Fund performance
to the extent the Fund is
exposed to such interest rates. Interest rate changes and their impact on the
Fund and its share price can be sudden
and unpredictable. Changes in market conditions and government policies may lead
to periods of heightened
volatility in the debt securities market, reduced liquidity Fund investments and
an increase in Fund redemptions.
Derivatives
Risk. The use
of derivatives, such as futures, options and swap agreements, presents risks
different from, and
possibly greater than, the risks associated with investing directly in
traditional securities. The use of derivatives
can lead to losses because of adverse movements in the price or value of the
derivatives’ underlying assets,
indexes or rates and the derivatives themselves, which may be magnified by
certain features of the derivatives.
These risks are heightened when derivatives are used to enhance a Fund’s return
or as a substitute for a position
or security, rather than solely to hedge (or mitigate) the risk of a position or
security held by the Fund. The
success of a derivative strategy will be affected by the portfolio manager’s
ability to assess and predict market or
economic developments and their impact on the derivatives’ underlying assets,
indexes or reference rates, as well as
the derivatives themselves. Certain derivative instruments may become illiquid
and, as a result, may be difficult
to sell when the portfolio manager believes it would be appropriate to do so.
Certain derivatives create leverage,
which can magnify the impact of a decline in the value of their underlying
assets, indexes or reference rates, and
increase the volatility of the Fund’s net asset value. Certain derivatives
(e.g., over-the-counter swaps) are also
subject to the risk that the counterparty to the derivative contract will be
unwilling or unable to fulfill its contractual
obligations, which may cause a Fund to lose money, suffer delays or incur costs
arising from holding or selling an
underlying asset. Changes in laws or regulations may make the use of derivatives
more costly, may limit the
availability of derivatives, or may otherwise adversely affect the use, value or
performance of derivatives.
Emerging
Markets Risk. Emerging
market securities typically present even greater exposure to the risks
described
under “Foreign Investment Risk” and may be particularly sensitive to global
economic conditions. For example,
emerging market countries are typically more dependent on exports and are,
therefore, more vulnerable to
recessions in other countries. Emerging markets tend to have less developed
legal and financial systems and a smaller
market capitalization than markets in developed countries. Some emerging markets
are subject to greater political
instability. Additionally, emerging markets may have more volatile currencies
and be more sensitive than
developed
markets to a variety of economic factors, including inflation. Emerging market
securities are also typically
less liquid than securities of developed countries and could be difficult to
sell, particularly during a market downturn.
Equity
Securities Risk. The
values of equity securities may experience periods of substantial price
volatility and may
decline significantly over short time periods. In general, the values of equity
securities are more volatile than those of
debt securities. Equity securities fluctuate in value and price in response to
factors specific to the issuer of the
security, such as management performance, financial condition, and market demand
for the issuer’s products or
services, as well as factors unrelated to the fundamental condition of the
issuer, including general market, economic
and political conditions. Investing in equity securities poses risks specific to
an issuer, as well as to the particular
type of company issuing the equity securities. For example, investing in the
equity securities of small- or mid-capitalization
companies can involve greater risk than is customarily associated with investing
in stocks of larger,
more-established companies. Different parts of a market, industry and sector may
react differently to adverse
issuer, market, regulatory, political, and economic developments. Negative news
or a poor outlook for a particular
industry can cause the share prices of securities of companies in that industry
to decline.
Foreign
Currency Contracts Risk. A Fund
that enters into forwards or other foreign currency contracts, which are
a type of
derivative, is subject to the risk that the portfolio manager may be incorrect
in his or her judgment of future
exchange rate changes. The Fund’s gains from positions in foreign currency
contracts may accelerate and/or lead to
recharacterization of the Fund’s income or gains and its distributions to
shareholders. The Fund’s losses from such
positions may also lead to recharacterization of the Fund’s income and its
distributions to shareholders and may
cause a return of capital to Fund shareholders.
Foreign
Investment Risk. Foreign
investments may be subject to lower liquidity, greater price volatility and
risks related to
adverse political, regulatory, market or economic developments. Foreign
companies may be subject to significantly
higher levels of taxation than U.S. companies, including potentially
confiscatory levels of taxation, thereby
reducing the earnings potential of such foreign companies. Foreign investments
may involve exposure to changes in
foreign currency exchange rates. Such changes may reduce the U.S. dollar value
of the investments. Foreign
investments may be subject to additional risks, such as potentially higher
withholding and other taxes, and may also
be subject to greater trade settlement, custodial, and other operational risks
than domestic investments. Certain
foreign markets may also be characterized by less stringent investor protection
and disclosure standards.
Futures Contracts
Risk. A Fund
that uses futures contracts, which are a type of derivative, is subject to the
risk of loss
caused by unanticipated market movements. In addition, there may at times be an
imperfect correlation between
the movement in the prices of futures contracts and the value of their
underlying instruments or indexes, and there
may at times not be a liquid secondary market for certain futures
contracts.
Growth/Value
Investing Risk.
Securities that exhibit certain characteristics, such as growth characteristics
or value
characteristics, tend to perform differently and shift into and out of favor
with investors depending on changes in
market and economic sentiment and conditions. As a result, a Fund’s performance
may at times be worse than
the performance of other mutual funds that invest more broadly or in securities
that exhibit different characteristics.
High
Yield Securities Risk. High
yield securities and unrated securities of similar credit quality (commonly
known as “junk
bonds”) have a much greater risk of default (or in the case of bonds currently
in default, of not returning principal)
and their values tend to be more volatile than higher-rated securities with
similar maturities. Additionally,
these securities tend to be less liquid and more difficult to value than
higher-rated securities.
Loan
Risk. Loans may
be unrated, less liquid and more difficult to value than traditional debt
securities. Loans may be made to
finance highly leveraged corporate operations or acquisitions. The highly
leveraged capital structure of the
borrowers in such transactions may make such loans especially vulnerable to
adverse changes in financial, economic
or market conditions. Loans generally are subject to restrictions on transfer,
and only limited opportunities
may exist to sell such loans in secondary markets. As a result, a Fund may be
unable to sell loans at a desired
time or price. If the Fund acquires only an assignment or a participation in a
loan made by a third party, the Fund may
not be able to control amendments, waivers or the exercise of any remedies that
a lender would have under a
direct loan and may assume liability as a lender.
Management
Risk.
Investment decisions, techniques, analyses or models implemented by a Fund’s
manager or sub-adviser
in seeking to achieve the Fund’s investment objective may not produce the
returns expected, may cause the
Fund’s shares to lose value or may cause the Fund to underperform other funds
with similar investment objectives.
Market
Risk. The
values of, and/or the income generated by, securities held by a Fund may decline
due to general market
conditions or other factors, including those directly involving the issuers of
such securities. Securities markets
are volatile and may decline significantly in response to adverse issuer,
regulatory, political, or economic developments.
Different sectors of the market and different security types may react
differently to such developments.
Political, geopolitical, natural and other events, including war, terrorism,
trade disputes, government
shutdowns, market closures, natural and environmental disasters, epidemics,
pandemics and other public
health crises and related events have led, and in the future may lead, to
economic uncertainty, decreased economic
activity, increased market volatility and other disruptive effects on U.S. and
global economies and markets.
Such events may have significant adverse direct or indirect effects on a Fund
and its investments. In addition,
economies and financial markets throughout the world are becoming increasingly
interconnected, which increases
the likelihood that events or conditions in one country or region will adversely
impact markets or issuers in other
countries or regions.
Mortgage-
and Asset-Backed Securities Risk. Mortgage-
and asset-backed securities are subject to risk of default on
the underlying mortgages or assets, particularly during periods of economic
downturn. Defaults on the underlying
mortgages or assets may cause such securities to decline in value and become
less liquid. Rising interest
rates tend to extend the duration of these securities, making them more
sensitive to changes in interest rates than
instruments with fixed payment schedules. As a result, in a period of rising
interest rates, these securities
may exhibit additional volatility. When interest rates decline or are low,
borrowers may pay off their mortgage
or other debts sooner than expected, which can reduce the returns of a Fund.
Funds that may enter into mortgage
dollar roll transactions are subject to the risk that the market value of the
securities that are required to be
repurchased in the future may decline below the agreed upon repurchase price.
They also involve the risk that the party
to whom the securities are sold may become insolvent, limiting a Fund’s ability
to repurchase securities at the
agreed upon price.
Swaps
Risk. Depending
on their structure, swap agreements and options to enter into swap agreements
(“swaptions”),
both of which are types of derivatives, may increase or decrease a Fund’s
exposure to long- or short-term
interest rates, foreign currency values, mortgage-backed securities, corporate
borrowing rates, or credit
events or other reference points such as security prices or inflation
rates.
U.S.
Government Obligations Risk. U.S.
Government obligations may be adversely impacted by changes in interest
rates, and securities issued or guaranteed by U.S. Government agencies or
government-sponsored entities
may not be backed by the full faith and credit of the U.S. Government. If a
government-sponsored entity is unable
to meet its obligations or its creditworthiness declines, the performance of a
Fund that holds securities issued or
guaranteed by the entity will be adversely impacted.
Portfolio
Holdings Information
A
description of the Wells Fargo Funds’ policies and procedures with respect to
disclosure of the Wells Fargo Funds’
portfolio holdings is available in the Funds’ Statement
of Additional Information.
Pricing Fund
Shares
A Fund’s NAV
is the value of a single share. The NAV is calculated as of the close of regular
trading on the New York Stock
Exchange (“NYSE”) (generally 4:00 p.m. Eastern time) on each day that the NYSE
is open, although a Fund may
deviate from this calculation time under unusual or unexpected
circumstances. The NAV
is calculated
separately for each class of shares of a multiple-class Fund. The most recent
NAV for each class of a Fund is
available at wfam.com. To calculate the NAV of a Fund’s
shares, the Fund’s
assets are valued and totaled, liabilities
are subtracted, and the balance, called net assets, is divided by the number of
shares outstanding. The price at
which a purchase or redemption request is processed is based on the next NAV
calculated after the request is
received in good order. Generally, NAV is not calculated, and purchase and
redemption requests are not processed,
on days that the NYSE is closed for trading; however, under unusual or
unexpected circumstances, a Fund may
elect to remain open even on days that the NYSE is closed or closes early. To
the extent that a Fund’s
assets are
traded in various markets on days when the Fund is
closed, the value of the Fund’s
assets may be affected
on days when you are unable to buy or sell Fund
shares. Conversely, trading in some of a Fund’s
assets may not
occur on days when the Fund is
open.
With
respect to any portion of a Fund’s
assets that may be invested in other mutual funds, the value of
the Fund’s
shares is
based on the NAV of the shares of the other mutual funds in which
the Fund
invests. The valuation methods
used by mutual funds in pricing their shares, including the circumstances under
which they will use fair value
pricing and the effects of using fair value pricing, are included in the
prospectuses of such funds. To the extent a Fund
invests a portion of its assets in non-registered investment vehicles,
the Fund’s
interests in the non-registered
vehicles are fair valued at NAV.
With
respect to a Fund’s
assets invested directly in securities, the Fund’s
investments are generally valued at current
market prices. Equity securities, options and futures are generally valued at
the official closing price or, if none, the
last reported sales price on the primary exchange or market on which they are
listed (closing price). Equity
securities that are not traded primarily on an exchange are generally valued at
the quoted bid price obtained
from a broker-dealer.
Debt
securities are valued at the evaluated bid price provided by an independent
pricing service or, if a reliable price is
not available, the quoted bid price from an independent
broker-dealer.
We are
required to depart from these general valuation methods and use fair value
pricing methods to determine the values
of certain investments if we believe that the closing price or the quoted bid
price of a security, including a security
that trades primarily on a foreign exchange, does not accurately reflect its
current market value as of the time
a Fund
calculates its NAV. The closing price or the quoted bid price of a security may
not reflect its current market
value if, among other things, a significant event occurs after the closing price
or quoted bid price are made available,
but before the time as of which a Fund
calculates its NAV, that materially affects the value of the security.
We use various criteria, including a systemic evaluation of U.S. market moves
after the close of foreign markets,
in deciding whether a foreign security’s market price is still reliable and, if
not, what fair market value to assign to
the security. In addition, we use fair value pricing to determine the value of
investments in securities and other
assets, including illiquid securities, for which current market quotations or
evaluated prices from a pricing service or
broker-dealer are not readily available.
The fair
value of a Fund’s
securities and other assets is determined in good faith pursuant to policies and
procedures
adopted by the Fund’s
Board of Trustees. In light of the judgment involved in making fair value
decisions,
there can be no assurance that a fair value assigned to a particular security is
accurate or that it reflects the price
that the Fund could
obtain for such security if it were to sell the security at the time as of which
fair value pricing is
determined. Such fair value pricing may result in NAVs that are higher or lower
than NAVs based on the closing
price or quoted bid price. See the Statement of Additional Information for
additional details regarding the determination
of NAVs.
Management
of the Funds
The
Manager
Wells
Fargo Funds Management, LLC (“Funds Management”), headquartered at 525 Market
Street, San Francisco, CA 94105,
provides advisory
and Fund level administrative services to the Funds
pursuant to an investment
management
agreement (the “Management Agreement”). Funds Management is a wholly owned
subsidiary of Wells
Fargo & Company, a publicly traded diversified financial services company
that provides banking, insurance, investment,
mortgage and consumer financial services. Funds Management is a registered
investment adviser that
provides advisory services for registered mutual funds, closed-end funds and
other funds and accounts. Funds
Management is a part of Wells Fargo Asset Management, the trade name used by the
asset management businesses
of Wells Fargo & Company.
Funds
Management is responsible for implementing the investment objectives and
strategies of the Funds.
Funds Management’s
investment professionals review and analyze the Funds’
performance, including relative to peer funds, and
monitor the Funds’
compliance with their
investment objectives and strategies. Funds Management is responsible
for reporting to the Board on investment performance and other matters affecting
the Funds.
When appropriate,
Funds Management recommends to the Board enhancements to Fund features,
including changes to Fund
investment objectives, strategies and policies. Funds Management also
communicates with shareholders
and
intermediaries about Fund performance and features.
Funds
Management is also responsible for providing Fund-level
administrative services to the Funds,
which include,
among others, providing such services in connection with the Funds’
operations; developing and implementing
procedures for monitoring compliance with regulatory requirements and compliance
with the Funds’
investment objectives, policies and restrictions; and providing any
other Fund-level
administrative services
reasonably necessary for the operation of the Funds,
other than those services that are provided by the Funds’ transfer
and dividend disbursing agent, custodian and fund accountant.
To assist
Funds Management in implementing the investment objectives and strategies of the
Funds,
Funds Management
may contract with one or more sub-advisers to provide day-to-day portfolio
management services to the
Funds.
Funds Management employs a team of investment professionals who identify and
recommend the initial
hiring of any sub-adviser and oversee and monitor the activities of any
sub-adviser on an ongoing basis. Funds
Management retains overall responsibility for the investment activities of the
Funds.
A
discussion regarding the basis for the Board’s approval of the Management
Agreement and any applicable sub-advisory
agreements for each Fund is
available in the Fund’s annual
report for the period ended August
31st.
For each Fund’s
most recent fiscal year end, the management
fee paid to Funds Management pursuant to the Management
Agreement, net of any applicable waivers and reimbursements, was as
follows:
|
|
Management
Fees Paid |
|
As
a % of average daily net assets |
Adjustable
Rate Government Fund |
0.27% |
Core
Plus Bond Fund |
0.28% |
Government
Securities Fund |
0.38% |
High
Yield Bond Fund |
0.43% |
Short
Duration Government Bond Fund |
0.32% |
Short-Term
High Yield Bond Fund |
0.37% |
Ultra
Short-Term Income Fund |
0.21% |
The
Sub-Adviser and Portfolio Managers
The
following sub-adviser
and portfolio
managers provide day-to-day portfolio management services to the Funds.
These services include making purchases and sales of securities and other
investment assets for the Funds,
selecting broker-dealers, negotiating brokerage commission rates and maintaining
portfolio transaction
records. The sub-adviser is
compensated for its services
by Funds Management from the fees Funds Management
receives for its services as investment manager to
the Funds. The
Statement of Additional Information
provides additional information about the portfolio
managers’ compensation, other accounts managed by
the portfolio
managers and the portfolio
managers’ ownership of securities in the Funds.
Wells
Capital Management Incorporated (“Wells
Capital Management”) is a registered investment adviser located at 525
Market Street, San Francisco, CA 94105. Wells Capital Management, an affiliate
of Funds Management and indirect
wholly owned subsidiary of Wells Fargo & Company, is a multi-boutique
asset management firm committed
to delivering superior investment services to institutional clients, including
mutual funds. Wells Capital Management
is a part of Wells Fargo Asset Management, the trade name used by the asset
management businesses
of Wells Fargo & Company.
|
|
Maulik
Bhansali, CFA Short
Duration Government Bond
Fund |
Mr.
Bhansali joined Wells Capital Management in 2001, where he currently
serves as a Senior
Portfolio Manager. |
Robert
Junkin High
Yield Bond Fund |
Mr.
Junkin joined Wells Capital Management or one of its predecessor firms in
2007, where
he currently serves as a Portfolio Manager. |
Christopher
Y. Kauffman, CFA Adjustable
Rate Government Fund Core
Plus Bond Fund Government
Securities Fund Ultra
Short-Term Income Fund |
Mr.
Kauffman joined Wells Capital Management or one of its affiliate firms in
2003, where
he currently serves as a Senior Portfolio Manager. |
Chris
Lee, CFA Short-Term
High Yield Bond Fund |
Mr.
Lee joined Wells Capital Management in 2012, where he currently serves as
a Senior
Portfolio Manager on the Multi-Sector Fixed Income Plus and High Yield
team. |
Jay
N. Mueller, CFA Core
Plus Bond Fund Government
Securities Fund Ultra
Short-Term Income Fund |
Mr.
Mueller joined Wells Capital Management or one of its predecessor firms in
1991, where
he currently serves as a Portfolio Manager specializing in macroeconomic
analysis. |
Margaret
D. Patel High
Yield Bond Fund |
Ms.
Patel joined Wells Capital Management or one of its predecessor firms in
2007, where
she currently serves as a Managing Director and Senior Portfolio
Manager. |
Janet
S. Rilling, CFA, CPA Core
Plus Bond Fund |
Ms.
Rilling joined Wells Capital Management or one of its predecessor firms in
1995, where
she currently serves as a Senior Portfolio Manager and specializes in
investment-grade
corporate debt securities. |
Michael
J. Schueller, CFA Core
Plus Bond Fund Short-Term
High Yield Bond Fund Ultra
Short-Term Income Fund |
Mr.
Schueller joined Wells Capital Management or one of its predecessor firms
in 2000, where
he currently serves as a Senior Portfolio Manager specializing in
high-yield securities. |
Michal
Stanczyk Adjustable
Rate Government Fund Government
Securities Fund |
Mr.
Stanczyk joined Wells Capital Management or one of its predecessor firms
in 2007, where
he currently serves as a Portfolio Manager in the Fixed Income team. He
was a Research
Analyst prior to becoming a Portfolio Manager in 2015. |
Jarad
Vasquez Short
Duration Government Bond
Fund |
Mr.
Vasquez joined Wells Capital Management in 2007, where he currently serves
as a Senior
Portfolio Manager. |
Noah
M. Wise, CFA Core
Plus Bond Fund Ultra
Short-Term Income Fund |
Mr.
Wise joined Wells Capital Management or one of its predecessor firms in
2008, where
he currently serves as a Portfolio Manager in the Fixed Income
team. |
Multi-Manager
Arrangement
The Funds and
Funds Management have obtained an exemptive order from the SEC that permits
Funds Management,
subject to Board approval, to select certain sub-advisers and enter into or
amend sub-advisory agreements
with them, without obtaining shareholder approval. The SEC order extends to
sub-advisers that are not
otherwise affiliated with Funds Management or the Funds, as
well as sub-advisers that are wholly-owned subsidiaries
of Funds Management or of a company that wholly owns Funds Management. In
addition, the SEC staff,
pursuant to no-action relief, has extended multi-manager relief to any
affiliated sub-adviser, such as affiliated
sub-advisers that are not wholly-owned subsidiaries of Funds Management or of a
company that wholly owns Funds
Management, provided certain conditions are satisfied (all such sub-advisers
covered by the order or relief,
“Multi-Manager Sub-Advisers”).
As such,
Funds Management, with Board approval, may hire or replace Multi-Manager
Sub-Advisers for each Fund that is
eligible to rely on the order or relief. Funds Management, subject to Board
oversight, has the responsibility to oversee
Multi-Manager Sub-Advisers and to recommend their hiring, termination and
replacement. If a new sub-adviser
is hired for a Fund pursuant to the order or relief, the Fund is required to
notify shareholders within 90 days.
The Funds are not
required to disclose the individual fees that Funds Management pays to a
Multi-Manager Sub-Adviser.
Account
Information
Share
Class Eligibility
Administrator
Class shares are generally available through intermediaries for the
accounts of their customers and directly
to institutional investors and individuals. Institutional investors may include
corporations; private banks; trust
companies; endowments and foundations; defined contribution, defined benefit and
other employer sponsored
retirement plans; institutional retirement plan platforms; insurance companies;
registered investment advisor
firms; bank trusts; 529 college savings plans; family offices; and funds of
funds, including those managed by Funds
Management. The following investors may purchase Administrator
Class shares and are not subject to a minimum
initial investment amount except, as noted below:
■ |
Employee
benefit plan programs; |
■ |
Broker-dealer
managed account or wrap programs that charge an asset-based
fee; |
■ |
Registered
investment adviser mutual fund wrap programs or other accounts that charge
a fee for advisory, investment,
consulting or similar services; |
■ |
Private
bank and trust company managed accounts or wrap programs that charge an
asset-based fee; |
■ |
Internal
Revenue Code Section 529 college savings plan
accounts; |
■ |
Funds
of funds, including those advised by Funds
Management; |
■ |
Private
Bank and Trust Departments of Wells Fargo & Company purchasing shares
on behalf of their clients; |
■ |
Endowments,
non-profits, and charitable organizations who invest a minimum initial
investment amount of $500,000
in a Fund; |
■ |
Any
other institutions or customers of intermediaries who invest a minimum
initial investment amount of $1 million
in a Fund; |
■ |
Individual
investors who invest a minimum initial investment amount of $1 million
directly in a Fund; |
■ |
Certain
investors and related accounts as detailed in the Statement of Additional
Information; and |
■ |
Individual
investors who purchase through an intermediary-sponsored self-directed
brokerage account program that
may or may not charge transaction fees. |
Eligibility
requirements for Administrator
Class shares may be modified or discontinued at any time.
Your Fund
may offer other classes of shares in addition to those offered through this
Prospectus. You may be eligible
to invest in one or more of these other classes of shares. Each share class
bears varying expenses and may differ in
other features. Consult your financial professional for more information
regarding a Fund’s available share classes.
The
information in this Prospectus is not intended for distribution to, or use by,
any person or entity in any non-U.S.
jurisdiction or country where such distribution or use would be contrary to any
law or regulation, or which would
subject Fund shares to any registration requirement within such jurisdiction or
country.
Share
Class Features
The table
below summarizes the key features of the share class offered through this
Prospectus.
|
|
|
|
Administrator
Class |
Front-End
Sales Charge |
|
None |
Contingent
Deferred Sales Charge (CDSC) |
|
None |
Ongoing
Distribution (12b-1) Fees |
|
None |
Shareholder
Servicing Fee |
|
0.25% |
Information
regarding sales charges, breakpoint levels, reductions and waivers is also
available free of charge on our
website at wfam.com. You may wish to discuss your choice of share class with
your financial professional.
Compensation
to Financial Professionals and Intermediaries
Shareholder
Servicing Plan
Each Fund
has adopted a shareholder servicing plan (“Servicing Plan”). The Servicing Plan
authorizes the Fund to enter into
agreements with the Fund’s distributor, manager, or any of their affiliates to
provide or engage other entities
to provide certain shareholder services, including establishing and maintaining
shareholder accounts, processing
and verifying purchase,
redemption and exchange transactions, and providing such other shareholder
liaison or
related services as may reasonably be requested. Under the Servicing Plan, fees
are paid up to the following
amounts:
|
|
|
Fund
|
Administrator
Class |
Adjustable
Rate Government Fund |
|
0.25% |
Core
Plus Bond Fund |
|
0.25% |
Government
Securities Fund |
|
0.25% |
High
Yield Bond Fund |
|
0.25% |
Short
Duration Government Bond Fund |
|
0.25% |
Short-Term
High Yield Bond Fund |
|
0.25% |
Ultra
Short-Term Income Fund |
|
0.25% |
Additional
Payments to Financial Professionals and Intermediaries
In
addition to dealer reallowances and payments made by certain classes
of each Fund
for distribution and shareholder
servicing, the Fund’s manager, the distributor or their affiliates make
additional payments (“Additional
Payments”) to certain financial professionals and intermediaries for selling
shares and providing shareholder
services, which include broker-dealers and 401(k) service providers and record
keepers. These Additional
Payments, which may be significant, are paid by the Fund’s manager, the
distributor or their affiliates, out of
their revenues, which generally come directly or indirectly from Fund
fees.
In return
for these Additional Payments, each
Fund’s manager and distributor expect the Fund to receive certain marketing
or servicing considerations that are not generally available to mutual funds
whose sponsors do not make such
payments. Such considerations are expected to include, without limitation,
placement of the Fund on a list of
mutual funds offered as investment options to the intermediary’s clients
(sometimes referred to as “Shelf Space”);
access to the intermediary’s financial professionals; and/or the ability to
assist in training and educating the
intermediary’s financial professionals.
The
Additional Payments may create potential conflicts of interest between an
investor and a financial professional
or intermediary who is recommending or making available a particular mutual fund
over other mutual funds.
Before investing, you should consult with your financial professional and review
carefully any disclosure by the
intermediary as to what compensation the intermediary receives from mutual fund
sponsors, as well as how your
financial professional is compensated.
The
Additional Payments are typically paid in fixed dollar amounts, based on the
number of customer accounts maintained
by an intermediary, or based on a percentage of sales and/or assets under
management, or a combination
of the above. The Additional Payments are either up-front or ongoing or both and
differ among intermediaries.
In a given year, Additional Payments to an intermediary that is compensated
based on its customers’
assets typically range between 0.02% and 0.25% of assets invested in a Fund by
the intermediary’s customers.
Additional Payments to an intermediary that is compensated based on a percentage
of sales typically range
between 0.10% and 0.25% of the gross sales of a Fund attributable to the
financial intermediary.
More
information on the FINRA member firms that have received the Additional Payments
described in this section is
available in the Statement of Additional Information, which is on file with the
SEC and is also available on the Wells
Fargo Funds website at wfam.com.
Buying
and Selling Fund Shares
For more
information regarding buying and selling Fund shares, please visit wfam.com. You
may buy (purchase) and sell
(redeem) Fund shares as follows:
|
|
|
|
Opening
an Account |
Adding
to an Account or Selling Fund Shares |
Through
Your Financial Professional |
Contact
your financial professional.
Transactions
will be subject to the terms of
your account with your intermediary. |
Contact
your financial professional.
Transactions
will be subject to the terms of your
account with your intermediary. |
Through
Your Retirement Plan |
Contact
your retirement plan administrator.
Transactions
will be subject to the terms of
your retirement plan account. |
Contact
your retirement plan administrator.
Transactions
will be subject to the terms of your
retirement plan account. |
Online |
New
accounts cannot be opened online. Contact
your financial professional or retirement
plan administrator, or refer to
the section on opening an account by mail. |
Visit
wfam.com.
Online
transactions are limited to a maximum
of $100,000. You may be eligible for
an exception to this maximum. Please call
Investor Services at 1-800-222-8222 for
more information. |
By
Telephone |
Call
Investor Services at 1-800-222-8222.
Available
only if you have another Wells Fargo
Fund account with your bank information
on file. |
Call
Investor Services at 1-800-222-8222.
Redemption
requests may not be made by phone
if the address on your account was changed
in the last 15 days. In this event, you
must request your redemption by mail. For
joint accounts, telephone requests generally
require only one of the account owners
to call unless you have instructed us otherwise. |
By
Mail |
Complete
an account application and submit
it according to the instructions on
the application.
Account
applications are available online at
wfam.com or by calling Investor Services
at 1-800-222-8222. |
Send
the items required under “Requests in
Good Order” below to:
Regular
Mail Wells
Fargo Funds P.O.
Box 219967 Kansas
City, MO 64121-9967
Overnight
Only Wells
Fargo Funds 430 W
7th Street STE 219967 Kansas
City, MO 64105-1407 |
Requests
in “Good Order”. All
purchase and redemption requests must be received in “good order.” This means
that a
request generally must include:
■ |
The
Fund name(s), share class(es) and account
number(s); |
■ |
The
amount (in dollars or shares) and type (purchase or redemption) of the
request; |
■ |
If by
mail, the signature of each registered owner as it appears in the account
application; |
■ |
For
purchase requests, payment of the full amount of the purchase request (see
“Payment” below); and |
■ |
Any
supporting legal documentation that may be
required. |
Purchase
and redemption requests in good order will be processed at the next NAV
calculated after the Fund’s transfer
agent or an authorized intermediary1 receives
your request. If your request is not received in good order, additional
documentation may be required to process your transaction. We reserve the right
to waive any of the above
requirements.
1. |
The
Fund’s shares may be purchased through an intermediary that has entered
into a dealer agreement with the Fund’s distributor. The Fund
has approved the acceptance of a purchase or redemption request effective
as of the time of its receipt by such an authorized intermediary
or its designee, as long as the request is received by one of those
entities prior to the Fund’s closing time. These intermediaries
may
charge transaction fees. We reserve the right to adjust the closing time
in certain circumstances. |
Payment. Payment
for Fund shares may be made as follows:
|
|
By
Wire |
Purchases
into a new or existing account may be funded by using the following wire
instructions:
State
Street Bank & Trust Boston,
MA Bank
Routing Number: ABA 011000028 Wire
Purchase Account: 9905-437-1 Attention:
Wells Fargo Funds (Name
of Fund, Account Number and any applicable share class) Account
Name: Provide your name as registered on the Fund account or as included
in your
account application. |
By
Check |
Make
checks payable to Wells Fargo Funds. |
By
Exchange |
Identify
an identically registered Wells Fargo Fund account from which you wish to
exchange
(see “Exchanging Fund Shares” below for restrictions on
exchanges). |
By
Electronic Funds Transfer (“EFT”) |
Additional
purchases for existing accounts may be funded by EFT using your linked
bank
account. |
All
payments must be in U.S. dollars, and all checks and EFTs must be drawn on U.S.
banks. You will be charged a $25.00 fee
for every check or EFT that is returned to us as unpaid.
Form of
Redemption Proceeds. You may
request that your redemption proceeds be sent to you by check, by EFT
into a
linked bank account, or by wire to a linked bank account. Please call Investor
Services at 1-800-222-8222 regarding
the requirements for linking bank accounts or for wiring funds. Under normal
circumstances, we expect to meet
redemption requests either by using uninvested cash or cash equivalents or by
using the proceeds from the sale
of portfolio securities, at the discretion of the portfolio manager(s). The
Wells Fargo Funds may also borrow
through a bank line of credit for the purpose of meeting redemption requests,
although we do not expect to draw
funds from this source on a regular basis. In lieu of making cash payments, we
reserve the right to determine
in our sole discretion, including under stressed market conditions, whether to
satisfy one or more redemption
requests by making payments in securities. In such cases, we may meet all or
part of a redemption request by
making payment in securities equal in value to the amount of the redemption
payable to you as permitted
under the 1940 Act, and the rules thereunder, in which case the redeeming
shareholder should expect to incur
transaction costs upon the disposition of any securities received.
Timing
of Redemption Proceeds. We
normally will send out redemption proceeds within one business day after
we accept
your request to redeem. We reserve the right to delay payment for up to seven
days. If you wish to redeem
shares purchased by check, by EFT or through the Automatic Investment Plan
within seven days of purchase,
you may be asked to resubmit your redemption request if your payment has not yet
cleared. Payment of redemption
proceeds may be delayed for longer than seven days under extraordinary
circumstances or as permitted
by the SEC in order to protect remaining shareholders. Such extraordinary
circumstances are discussed further in
the Statement of Additional Information.
Retirement
Plans and Other Products. If you
purchased shares through a packaged investment product or retirement
plan, read the directions for redeeming shares provided by the product or plan.
There may be special requirements
that supersede or are in addition to the requirements in this
Prospectus.
Exchanging
Fund Shares
Exchanges
between two funds involve two transactions: (1) the redemption of shares of one
fund; and (2) the purchase
of shares of another. In general, the same rules and procedures described under
“Buying and Selling Fund Shares”
apply to exchanges. There are, however, additional policies and considerations
you should keep in mind while
making or considering an exchange:
■ |
In
general, exchanges may be made between like share classes of any fund in
the Wells Fargo Funds complex offered
to the general public for investment (i.e., a fund not closed to new
accounts), with the following exceptions:
(1) Class A shares of non-money market funds may also be exchanged for
Service Class shares of any retail or
government money market fund; (2) Service Class shares may be exchanged
for Class A shares of any non-money
market fund; and (3) no exchanges are allowed into institutional money
market funds. |
■ |
If you
make an exchange between Class A shares of a money market fund or Class A2
or Class A shares of a non-money
market fund, you will buy the shares at the public offering price of the
new fund, unless you are otherwise eligible
to buy shares at NAV. |
■ |
Same-fund
exchanges between share classes are permitted subject to the following
conditions: (1) the shareholder
must meet the eligibility guidelines of the class being purchased in the
exchange; (2) exchanges out of Class A
and Class C shares would not be allowed if shares are subject to a CDSC;
and (3) for non-money market funds,
in order to exchange into Class A shares, the shareholder must be able to
qualify to purchase Class A shares
at NAV based on current Prospectus
guidelines. |
■ |
An
exchange request will be processed on the same business day, provided that
both funds are open at the time the
request is received. If one or both funds are closed, the exchange will be
processed on the following business day. |
■ |
You
should carefully read the Prospectus for the Fund into which you wish to
exchange. |
■ |
Every
exchange involves redeeming fund shares, which may produce a capital gain
or loss for tax purposes. |
■ |
If you
are making an initial investment into a fund through an exchange, you must
exchange at least the minimum
initial investment amount for the new fund, unless your balance has fallen
below that amount due to investment
performance. |
■ |
If you
are making an additional investment into a fund that you already own
through an exchange, you must exchange
at least the minimum subsequent investment amount for the fund you are
exchanging into. |
■ |
Class C
share exchanges will not trigger a CDSC. The new shares received in the
exchange will continue to age according
to the original shares’ CDSC schedule and will be charged the CDSC
applicable to the original shares upon
redemption. |
Generally,
we will notify you at least 60 days in advance of any changes in the above
exchange policies.
Frequent
Purchases and Redemptions of Fund Shares
Wells
Fargo Funds reserves the right to reject any purchase or exchange order for
any reason. If a shareholder redeems
$20,000 or more (including redemptions that are part of an exchange transaction)
from a Covered Fund, that
shareholder is “blocked” from purchasing shares of that Covered Fund (including
purchases that are part of an exchange
transaction) for 30 calendar days after the redemption.
Excessive
trading by Fund shareholders can negatively impact a Fund and its long-term
shareholders in several ways,
including disrupting Fund investment strategies, increasing transaction costs,
decreasing tax efficiency, and diluting
the value of shares held by long-term shareholders. Excessive trading in Fund
shares can negatively impact a
Fund’s long-term performance by requiring it to maintain more assets in cash or
to liquidate portfolio holdings
at a disadvantageous time. Certain Funds may be more susceptible than others to
these negative effects. For
example, Funds that have a greater percentage of their investments in non-U.S.
securities may be more susceptible
than other Funds to arbitrage opportunities resulting from pricing variations
due to time zone differences
across international financial markets. Similarly, Funds that have a greater
percentage of their investments
in small company securities may be more susceptible than other Funds to
arbitrage opportunities due to the
less liquid nature of small company securities. Both types of Funds also may
incur higher transaction costs in
liquidating portfolio holdings to meet excessive redemption levels. Fair value
pricing may reduce these arbitrage
opportunities, thereby reducing some of the negative effects of excessive
trading.
Wells
Fargo Funds, other than the Adjustable Rate Government Fund, Conservative Income
Fund, Ultra Short-Term
Income Fund and Ultra Short-Term Municipal Income Fund (“Ultra-Short Funds”) and
the money market
funds, (the “Covered Funds”). The
Covered Funds are not designed to serve as vehicles for frequent trading.
The Covered Funds actively discourage and take steps to prevent the portfolio
disruption and negative effects on
long-term shareholders that can result from excessive trading activity by
Covered Fund shareholders. The Board
has approved the Covered Funds’ policies and procedures, which provide, among
other things, that Funds
Management may deem trading activity to be excessive if it determines that such
trading activity would likely be
disruptive to a Covered Fund by increasing expenses or lowering returns. In this
regard, the Covered Funds take
steps to avoid accommodating frequent purchases and redemptions of shares by
Covered Fund shareholders.
Funds Management monitors available shareholder trading information across all
Covered Funds on a daily
basis. If a shareholder redeems $20,000 or more (including redemptions that are
part of an exchange transaction)
from a Covered Fund, that shareholder is “blocked” from purchasing shares of
that Covered Fund (including
purchases that are part of an exchange transaction) for 30 calendar days after
the redemption. This policy
does not apply to:
■ |
Dividend
reinvestments; |
■ |
Systematic
investments or exchanges where the financial intermediary maintaining
the shareholder account identifies
the transaction as a systematic redemption or purchase at the time of the
transaction; |
■ |
Rebalancing
transactions within certain asset allocation or “wrap” programs where the
financial intermediary maintaining
a shareholder account is able to identify the transaction as part of an
asset allocation program approved
by Funds Management; |
■ |
Transactions
initiated by a “fund of funds” or Section 529 Plan into an underlying fund
investment; |
■ |
Permitted
exchanges between share classes of the same
Fund; |
■ |
Certain
transactions involving participants in employer-sponsored retirement
plans, including: participant withdrawals
due to mandatory distributions, rollovers and hardships, withdrawals of
shares acquired by participants through
payroll deductions, and shares acquired or sold by a participant in
connection with plan loans; and |
■ |
Purchases
below $20,000 (including purchases that are part of an exchange
transaction). |
The
money market funds and the Ultra-Short Funds. Because
the money market funds and Ultra-Short Funds are often used
for short-term investments, they are designed to accommodate more frequent
purchases and redemptions
than the Covered Funds. As a result, the money market funds and Ultra-Short
Funds do not anticipate
that frequent purchases and redemptions, under normal circumstances, will have
significant adverse consequences
to the money market funds or Ultra-Short Funds or their shareholders. Although
the money market
funds and Ultra-Short Funds do not prohibit frequent trading, Funds Management
will seek to prevent an investor
from utilizing the money market funds and Ultra-Short Funds to facilitate
frequent purchases and redemptions
of shares in the Covered Funds in contravention of the policies and procedures
adopted by the Covered
Funds.
All
Wells Fargo Funds. In
addition, Funds Management reserves the right to accept purchases, redemptions
and exchanges
made in excess of applicable trading restrictions in designated accounts held by
Funds Management or its
affiliate that are used at all times exclusively for addressing operational
matters related to shareholder accounts,
such as testing of account functions, and are maintained at low balances that do
not exceed specified dollar
amount limitations.
In the
event that an asset allocation or “wrap” program is unable to implement the
policy outlined above, Funds Management
may grant a program-level exception to this policy. A financial intermediary
relying on the exception is
required to provide Funds Management with specific information regarding its
program and ongoing information
about its program upon request.
A
financial intermediary through whom you may purchase shares of the Fund may
independently attempt to identify
excessive trading and take steps to deter such activity. As a result, a
financial intermediary may on its own limit or
permit trading activity of its customers who invest in Fund shares using
standards different from the standards
used by Funds Management and discussed in this Prospectus. Funds Management may
permit a financial
intermediary to enforce its own internal policies and procedures concerning
frequent trading rather than the
policies set forth above in instances where Funds Management reasonably believes
that the intermediary’s policies
and procedures effectively discourage disruptive trading activity. If you
purchase Fund shares through a financial
intermediary, you should contact the intermediary for more information about
whether and how restrictions
or limitations on trading activity will be applied to your
account.
Account
Policies
Advance
Notice of Large Transactions. We
strongly urge you to make all purchases and redemptions of Fund shares as
early in the day as possible and to notify us or your intermediary at least one
day in advance of transactions
in Fund shares in excess of $1 million. This will help us to manage the Funds
most effectively. When you give
this advance notice, please provide your name and account number.
Householding. To help
keep Fund expenses low, a single copy of a Prospectus or shareholder report may
be sent to shareholders
of the same household. If your household currently receives a single copy of a
Prospectus or shareholder
report and you would prefer to receive multiple copies, please call Investor
Services at 1-800-222-8222
or contact your financial professional.
Retirement
Accounts. We offer
a variety of retirement account types for individuals and small businesses.
There may be
special distribution requirements for a retirement account, such as required
distributions or mandatory Federal
income tax withholdings. For more information about the retirement accounts
listed below, including any distribution
requirements, call Investor Services at 1-800-222-8222. For retirement accounts
held directly with a Fund,
certain fees may apply including an annual account maintenance fee.
The
retirement accounts available for individuals and small businesses
are:
■ |
Individual
Retirement Accounts, including Traditional IRAs and Roth
IRAs. |
■ |
Small
business retirement accounts, including Simple IRAs and SEP
IRAs. |
Small
Account Redemptions. We
reserve the right to redeem accounts that have values that fall below a Fund’s
minimum
initial investment amount due to shareholder redemptions (as opposed to market
movement). Before doing so,
we will give you approximately 60 days to bring your account value above the
Fund’s minimum initial investment
amount. Please call Investor Services at 1-800-222-8222 or contact your
financial professional for further
details.
Transaction
Authorizations. We may
accept telephone, electronic, and clearing agency transaction instructions
from
anyone who represents that he or she is a shareholder and provides reasonable
confirmation of his or her identity.
Neither we nor Wells Fargo Funds will be liable for any losses incurred if we
follow such instructions we reasonably
believe to be genuine. For transactions through our website, we may assign
personal identification numbers
(PINs) and you will need to create a login ID and password for account access.
To safeguard your account, please
keep these credentials confidential. Contact us immediately if you believe there
is a discrepancy on your confirmation
statement or if you believe someone has obtained unauthorized access to your
online access credentials.
Identity
Verification. We are
required by law to obtain from you certain personal information that will be
used to verify
your identity. If you do not provide the information, we will not be able to
open your account. In the rare event that
we are unable to verify your identity as required by law, we reserve the right
to redeem your account at the
current NAV of the Fund’s shares. You will be responsible for any losses, taxes,
expenses, fees, or other results of such a
redemption.
Right
to Freeze Accounts, Suspend Account Services or Reject or Terminate an
Investment. We
reserve the right, to
the extent permitted by law and/or regulations, to freeze any account or suspend
account services when we have
received reasonable notice (written or otherwise) of a dispute between
registered or beneficial account owners or
when we believe a fraudulent transaction may occur or has occurred.
Additionally, we reserve the right to reject
any purchase or exchange request and to terminate a shareholder’s investment,
including closing the shareholder’s
account.
Distributions
The Funds,
except the Core Plus Bond Fund, generally declare distributions of any net
investment income daily,and pay such
distributions monthly. The Core Plus Bond Fund generally declares distributions
of any net investment income
monthly, and pays such distributions monthly. For the Core Plus Bond Fund,
the amount distributed in any given
period may be less than the amount earned in that period or more than
the amount earned in that period if it
includes amounts earned in a previous period but retained for later
distribution. The Funds generally make distributions
of any realized net capital gains annually. Please note, distributions
have the effect of reducing the NAV per
share by the amount distributed.
We offer
the following distribution options. To change your current option for payment of
distributions, please call Investor
Services at 1-800-222-8222.
■ |
Automatic
Reinvestment Option—Allows you to use distributions to buy new shares of
the same class of the Fund
that generated the distributions. The new shares are purchased at NAV
generally on the day the distribution is
paid. This option is automatically assigned to your account unless you
specify another option. |
■ |
Check
Payment Option—Allows you to receive distributions via checks mailed to
your address of record or to another
name and address which you have specified in written instructions. A
Medallion Guarantee may also be required.
If checks remain uncashed for six months or are undeliverable by the Post
Office, we will reinvest the distributions
at the earliest date possible, and future distributions will be
automatically reinvested. |
■ |
Bank
Account Payment Option—Allows you to receive distributions directly in a
checking or savings account through
EFT. The bank account must be linked to your Wells Fargo Fund account. Any
distribution returned to us due
to an invalid banking instruction will be sent to your address of record
by check at the earliest date possible,
and future distributions will be automatically
reinvested. |
■ |
Directed
Distribution Purchase Option—Allows you to buy shares of a different Wells
Fargo Fund of the same share
class. The new shares are purchased at NAV generally on the day the
distribution is paid. In order to use this
option, you need to identify the Fund and account the distributions are
coming from, and the Fund and account
to which the distributions are being directed. You must meet any required
minimum investment amounts in both
Funds prior to using this option. |
You are
eligible to earn distributions beginning on the business day after the Fund’s
transfer agent or an authorized
intermediary receives your purchase request in good order.
Other
Information
Taxes
The
following discussion regarding federal income taxes is based on laws that were
in effect as of the date of this Prospectus
and summarizes only some of the important federal income tax considerations
affecting the Fund and you as a
shareholder. It does not apply to foreign or tax-exempt shareholders or those
holding Fund shares through a
tax-advantaged account, such as a 401(k) Plan or IRA. This discussion is not
intended as a substitute for careful
tax planning. You should consult your tax adviser about your specific tax
situation. Please see the Statement
of Additional Information for additional federal income tax
information.
The Fund
elected to be treated, and intends to qualify each year, as a regulated
investment company (“RIC”) under the
Internal Revenue Code of 1986, as amended. A RIC is not subject to tax at the
corporate level on income and gains from
investments that are distributed in a timely manner to shareholders. However,
the Fund’s failure to qualify as
a RIC would result in corporate level taxation, and consequently, a reduction in
income available for distribution
to you as a shareholder.
We will
pass on to a Fund’s shareholders substantially all of the Fund’s net investment
income and realized net capital
gains, if any. Distributions from a Fund’s ordinary income and net short-term
capital gains, if any, generally will be
taxable to you as ordinary income. Distributions from a Fund’s net long-term
capital gains, if any, generally will be
taxable to you as long-term capital gains. If you are an individual and meet
certain holding period requirements
with respect to your Fund shares, you may be eligible for reduced tax rates on
qualified dividend income, if
any, distributed by the Fund.
Corporate
shareholders may be able to deduct a portion of their distributions when
determining their taxable income.
Individual
taxpayers are subject to a maximum tax rate of 37% on ordinary income and a
maximum tax rate on long-term
capital gains and qualified dividends of 20%. For U.S. individuals with income
exceeding $200,000 ($250,000
if married and filing jointly), a 3.8% Medicare contribution tax will apply on
“net investment income,” including
interest, dividends, and capital gains. Corporations are subject to tax on all
income and gains at a tax rate of 21%.
However, a RIC is not subject to tax at the corporate level on income and gains
from investments that are distributed
in a timely manner to shareholders.
Distributions
from a Fund normally will be taxable to you when paid, whether you take
distributions in cash or automatically
reinvest them in additional Fund shares. Following the end of each year, we will
notify you of the federal
income tax status of your distributions for the year.
If you buy
shares of a Fund shortly before it makes a taxable distribution, your
distribution will, in effect, be a taxable
return of part of your investment. Similarly, if you buy shares of a Fund when
it holds appreciated securities,
you will receive a taxable return of part of your investment if and when the
Fund sells the appreciated securities
and distributes the gain. The Fund has built up, or has the potential to build
up, high levels of unrealized appreciation.
Your
redemptions (including redemptions in-kind) and exchanges of Fund shares
ordinarily will result in a taxable capital
gain or loss, depending on the amount you receive for your shares (or are deemed
to receive in the case of exchanges)
and the amount you paid (or are deemed to have paid) for them. Such capital gain
or loss generally will be
long-term capital gain or loss if you have held your redeemed or exchanged Fund
shares for more than one year at the
time of redemption or exchange. In certain circumstances, losses realized on the
redemption or exchange of Fund
shares may be disallowed.
When you
receive a distribution from a Fund or redeem shares, you may be subject to
backup withholding.
Financial
Highlights
The
following tables are intended
to help you understand a Fund’s financial performance for the past five years
(or since
inception, if shorter). Certain information reflects financial results for a
single Fund share. Total returns represent
the rate you would have earned (or lost) on an investment in each Fund
(assuming reinvestment of all distributions).
The information in the following tables has
been derived from the Funds’
financial statements
which have been
audited by KPMG LLP, the Funds’ independent registered public accounting firm,
whose report, along
with each
Fund’s financial statements,
is also included in each
Fund’s annual report, a copy of which is available
upon request.
Adjustable
Rate Government Fund
For a
share outstanding throughout each period
|
|
|
|
|
|
|
|
|
|
|
|
|
Year
ended August 31 |
Administrator
Class |
|
2020 |
|
2019 |
|
2018 |
|
2017 |
|
2016 |
Net
asset value, beginning of period |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Net
realized and unrealized gains (losses) on investments
|
|
|
|
|
|
|
|
|
|
|
Total
from investment operations |
|
|
|
|
|
|
|
|
|
|
Distributions
to shareholders from |
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Net
realized gains |
|
|
|
|
|
|
|
|
|
|
Tax
basis return of capital |
|
|
|
|
|
|
|
|
|
|
Total
distributions to shareholders |
|
|
|
|
|
|
|
|
|
|
Net
asset value, end of period |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
Total
return |
|
|
|
|
|
|
|
|
|
|
Ratios
to average net assets (annualized) |
|
|
|
|
|
|
|
|
|
|
Gross
expenses |
|
|
|
|
|
|
|
|
|
|
Net
expenses |
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Supplemental
data |
|
|
|
|
|
|
|
|
|
|
Portfolio
turnover rate |
|
|
|
|
|
|
|
|
|
|
Net
assets, end of period (000s omitted) |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
1. |
Calculated
based upon average shares outstanding |
2. |
Amount
is less than $0.005 |
Core
Plus Bond Fund
For a
share outstanding throughout each period
|
|
|
|
|
|
|
|
|
|
|
|
|
Year
ended August 31 |
Administrator
Class |
|
2020 |
|
2019 |
|
2018 |
|
2017 |
|
2016 |
Net
asset value, beginning of period |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Net
realized and unrealized gains (losses) on investments
|
|
|
|
|
|
|
|
|
|
|
Total
from investment operations |
|
|
|
|
|
|
|
|
|
|
Distributions
to shareholders from |
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Net
realized gains |
|
|
|
|
|
|
|
|
|
|
Total
distributions to shareholders |
|
|
|
|
|
|
|
|
|
|
Net
asset value, end of period |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
Total
return |
|
|
|
|
|
|
|
|
|
|
Ratios
to average net assets (annualized) |
|
|
|
|
|
|
|
|
|
|
Gross
expenses |
|
|
|
|
|
|
|
|
|
|
Net
expenses |
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Supplemental
data |
|
|
|
|
|
|
|
|
|
|
Portfolio
turnover rate |
|
|
|
|
|
|
|
|
|
|
Net
assets, end of period (000s omitted) |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
Government
Securities Fund
For a
share outstanding throughout each period
|
|
|
|
|
|
|
|
|
|
|
|
|
Year
ended August 31 |
Administrator
Class |
|
2020 |
|
2019 |
|
2018 |
|
2017 |
|
2016 |
Net
asset value, beginning of period |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Net
realized and unrealized gains (losses) on investments
|
|
|
|
|
|
|
|
|
|
|
Total
from investment operations |
|
|
|
|
|
|
|
|
|
|
Distributions
to shareholders from |
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Net
realized gains |
|
|
|
|
|
|
|
|
|
|
Tax
basis return of capital |
|
|
|
|
|
|
|
|
|
|
Total
distributions to shareholders |
|
|
|
|
|
|
|
|
|
|
Net
asset value, end of period |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
Total
return |
|
|
|
|
|
|
|
|
|
|
Ratios
to average net assets (annualized) |
|
|
|
|
|
|
|
|
|
|
Gross
expenses |
|
|
|
|
|
|
|
|
|
|
Net
expenses |
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Supplemental
data |
|
|
|
|
|
|
|
|
|
|
Portfolio
turnover rate |
|
|
|
|
|
|
|
|
|
|
Net
assets, end of period (000s omitted) |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
1. |
Calculated
based upon average shares outstanding |
High
Yield Bond Fund
For a
share outstanding throughout each period
|
|
|
|
|
|
|
|
|
|
|
|
|
Year
ended August 31 |
Administrator
Class |
|
2020 |
|
2019 |
|
2018 |
|
2017 |
|
2016 |
Net
asset value, beginning of period |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Net
realized and unrealized gains (losses) on investments
|
|
|
|
|
|
|
|
|
|
|
Total
from investment operations |
|
|
|
|
|
|
|
|
|
|
Distributions
to shareholders from |
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Tax
basis return of capital |
|
|
|
|
|
|
|
|
|
|
Total
distributions to shareholders |
|
|
|
|
|
|
|
|
|
|
Net
asset value, end of period |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
Total
return |
|
|
|
|
|
|
|
|
|
|
Ratios
to average net assets (annualized) |
|
|
|
|
|
|
|
|
|
|
Gross
expenses |
|
|
|
|
|
|
|
|
|
|
Net
expenses |
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Supplemental
data |
|
|
|
|
|
|
|
|
|
|
Portfolio
turnover rate |
|
|
|
|
|
|
|
|
|
|
Net
assets, end of period (000s omitted) |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
1. |
Calculated
based upon average shares outstanding |
2. |
Amount
is less than $0.005. |
Short
Duration Government Bond Fund
For a
share outstanding throughout each period
|
|
|
|
|
|
|
|
|
|
|
|
|
Year
ended August 31 |
Administrator
Class |
|
2020 |
|
2019 |
|
2018 |
|
2017 |
|
2016 |
Net
asset value, beginning of period |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Net
realized and unrealized gains (losses) on investments
|
|
|
|
|
|
|
|
|
|
|
Total
from investment operations |
|
|
|
|
|
|
|
|
|
|
Distributions
to shareholders from |
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Net
asset value, end of period |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
Total
return |
|
|
|
|
|
|
|
|
|
|
Ratios
to average net assets (annualized) |
|
|
|
|
|
|
|
|
|
|
Gross
expenses |
|
|
|
|
|
|
|
|
|
|
Net
expenses |
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Supplemental
data |
|
|
|
|
|
|
|
|
|
|
Portfolio
turnover rate |
|
|
|
|
|
|
|
|
|
|
Net
assets, end of period (000s omitted) |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
1. |
Calculated
based upon average shares outstanding |
Short-Term
High Yield Bond Fund
For a
share outstanding throughout each period
|
|
|
|
|
|
|
|
|
|
|
|
|
Year
ended August 31 |
Administrator
Class |
|
2020 |
|
2019 |
|
2018 |
|
2017 |
|
2016 |
Net
asset value, beginning of period |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Net
realized and unrealized gains (losses) on investments
|
|
|
|
|
|
|
|
|
|
|
Total
from investment operations |
|
|
|
|
|
|
|
|
|
|
Distributions
to shareholders from |
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Net
asset value, end of period |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
Total
return |
|
|
|
|
|
|
|
|
|
|
Ratios
to average net assets (annualized) |
|
|
|
|
|
|
|
|
|
|
Gross
expenses |
|
|
|
|
|
|
|
|
|
|
Net
expenses |
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Supplemental
data |
|
|
|
|
|
|
|
|
|
|
Portfolio
turnover rate |
|
|
|
|
|
|
|
|
|
|
Net
assets, end of period (000s omitted) |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
Ultra
Short-Term Income Fund
For a
share outstanding throughout each period
|
|
|
|
|
|
|
|
|
|
|
|
|
Year
ended August 31 |
Administrator
Class |
|
2020 |
|
2019 |
|
2018 |
|
2017 |
|
2016 |
Net
asset value, beginning of period |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Net
realized and unrealized gains (losses) on investments
|
|
|
|
|
|
|
|
|
|
|
Total
from investment operations |
|
|
|
|
|
|
|
|
|
|
Distributions
to shareholders from |
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Net
asset value, end of period |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
Total
return |
|
|
|
|
|
|
|
|
|
|
Ratios
to average net assets (annualized) |
|
|
|
|
|
|
|
|
|
|
Gross
expenses |
|
|
|
|
|
|
|
|
|
|
Net
expenses |
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
|
|
|
|
|
|
|
|
Supplemental
data |
|
|
|
|
|
|
|
|
|
|
Portfolio
turnover rate |
|
|
|
|
|
|
|
|
|
|
Net
assets, end of period (000s omitted) |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
1. |
Calculated
based upon average shares outstanding |
|
|
|
|
FOR
MORE INFORMATION
More
information on a Fund is available free upon request, including
the following documents:
Statement
of Additional Information (“SAI”) Supplements
the disclosures made by this Prospectus. The
SAI, which has been filed with the SEC, is incorporated
by reference into this Prospectus and therefore
is legally part of this Prospectus.
Annual/Semi-Annual
Reports Provide
financial and other important information, including
a discussion of the market conditions and
investment strategies that significantly affected Fund
performance over the reporting period.
To
obtain copies of the above documents or for more information
about Wells Fargo Funds, contact us:
By
telephone: Individual
Investors: 1-800-222-8222 Retail
Investment Professionals: 1-888-877-9275 Institutional
Investment Professionals: 1-800-260-5969 |
By
mail: Wells
Fargo Funds P.O.
Box 219967 Kansas
City, MO 64121-9967
Online: wfam.com
From
the SEC: Visit
the SEC’s Public Reference Room in Washington, DC
(phone 1-202-551-8090 for operational information
for the SEC’s Public Reference Room) or the
SEC’s website at sec.gov.
To
obtain information for a fee, write or email: SEC’s
Public Reference Section 100
“F” Street, NE Washington,
DC 20549-0102 [email protected]
The
Wells Fargo Funds are distributed by Wells
Fargo Funds Distributor, LLC, a member of FINRA, and
an affiliate of Wells Fargo &
Company. |
|
|
©
2021
Wells Fargo & Company. All rights reserved. |
011IFAM/P1003 ICA
Reg. No. 811-09253 |