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Statement of Additional Information
John Hancock Funds II
January 1, 2023
 
A
C
I
R2
R4
R5
R6
NAV
1
Alternative Asset Allocation Fund
JAAAX
JAACX
JAAIX
JAAPX
JAASX
N/A
JAARX
N/A
N/A
Blue Chip Growth Fund
JBGAX
JBGCX
N/A
N/A
N/A
N/A
JHBCDX
JIBCX
Capital Appreciation Fund
N/A
N/A
N/A
N/A
N/A
N/A
N/A
JHCPX
JICPX
Capital Appreciation Value Fund
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Core Bond Fund
N/A
N/A
N/A
N/A
N/A
N/A
N/A
JHCDX
JICDX
Emerging Markets Fund
JEVAX
JEVCX
JEVIX
N/A
JEVRX
JEVNX
N/A
Emerging Markets Debt Fund
JMKAX
JMKCX
JMKIX
JHEMX
JHMDX
N/A
JEMIX
N/A
Equity Income Fund
JHEIX
JHERX
N/A
N/A
N/A
N/A
JIEMX
Floating Rate Income Fund
JFIAX
JFIGX
JFIIX
N/A
N/A
N/A
JFIRX
JFIHX
Fundamental Global Franchise Fund
JFGAX
N/A
JFGIX
N/A
N/A
N/A
JFGFX
N/A
Global Equity Fund
JHGEX
JGECX
JGEFX
JGERX
JGETX
N/A
JGEMX
N/A
Health Sciences Fund
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
High Yield Fund
N/A
N/A
N/A
N/A
N/A
N/A
N/A
JHHDX
JIHDX
International Small Company Fund
JISAX
JISDX
JSCIX
JHSMX
N/A
International Strategic Equity Allocation    Fund
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Mid Value Fund
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Multi-Asset High Income Fund
JIAFX
JIAGX
JIAIX
N/A
N/A
N/A
JIASX
N/A
Lifestyle Blend Aggressive Portfolio (formerly Multi-Index Lifestyle Aggressive Portfolio)
JABQX
N/A
JIIRX
N/A
JIIOX
Lifestyle Blend Balanced Portfolio (formerly Multi-Index Lifestyle Balanced Portfolio)
JABMX
N/A
JIBRX
N/A
JIBOX
Lifestyle Blend Conservative Portfolio (formerly Multi-Index Lifestyle Conservative Portfolio)
JABJX
N/A
JLCSX
N/A
JLCGX
Lifestyle Blend Growth Portfolio (formerly Multi-Index Lifestyle Growth Portfolio)
JABPX
N/A
JLGSX
N/A
JLGOX
Lifestyle Blend Moderate Portfolio (formerly Multi-Index Lifestyle Moderate Portfolio)
JABKX
N/A
JLMRX
N/A
JLMOX
2065 Lifetime Blend Portfolio (formerly Multi-Index 2065 Lifetime Portfolio)
JHBLX
N/A
N/A
N/A
JAAJX
N/A
JAAKX
N/A
JAAFX
2060 Lifetime Blend Portfolio (formerly Multi-Index 2060 Lifetime Portfolio)
JHBKX
N/A
N/A
N/A
JHIKX
N/A
JIEHX
N/A
JRODX
2055 Lifetime Blend Portfolio (formerly Multi-Index 2055 Lifetime Portfolio)
JHBJX
N/A
N/A
N/A
JLKWX
N/A
JLKYX
N/A
JLKZX
2050 Lifetime Blend Portfolio (formerly Multi-Index 2050 Lifetime Portfolio)
JHBFX
N/A
N/A
N/A
JRTYX
N/A
JRLZX
N/A
JRLWX
2045 Lifetime Blend Portfolio (formerly Multi-Index 2045 Lifetime Portfolio)
JHBEX
N/A
N/A
N/A
JRLUX
N/A
JRLVX
N/A
JRLQX
Manulife, Manulife Investment Management, Stylized M Design, and Manulife Investment Management & Stylized M Design are trademarks of The Manufacturers Life Insurance Company and are used by its affiliates under license.

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JH0831SAI

 
 
A
C
I
R2
R4
R5
R6
NAV
1
2040 Lifetime Blend Portfolio (formerly Multi-Index 2040 Lifetime Portfolio)
JHBAX
N/A
N/A
N/A
JRTVX
N/A
JRTWX
N/A
JRTTX
2035 Lifetime Blend Portfolio (formerly Multi-Index 2035 Lifetime Portfolio)
JHAYX
N/A
N/A
N/A
JRTMX
N/A
JRTNX
N/A
JRTKX
2030 Lifetime Blend Portfolio (formerly Multi-Index 2030 Lifetime Portfolio)
JHAVX
N/A
N/A
N/A
JRTIX
N/A
JRTJX
N/A
JRTGX
2025 Lifetime Blend Portfolio (formerly Multi-Index 2025 Lifetime Portfolio)
JHAUX
N/A
N/A
N/A
JRTDX
N/A
JRTFX
N/A
JRTBX
2020 Lifetime Blend Portfolio (formerly Multi-Index 2020 Lifetime Portfolio)
JHAPX
N/A
N/A
N/A
JRLPX
N/A
JRTAX
N/A
JRLOX
2015 Lifetime Blend Portfolio (formerly Multi-Index 2015 Lifetime Portfolio)
JHAOX
N/A
N/A
N/A
JRLKX
N/A
JRLLX
N/A
JRLIX
2010 Lifetime Blend Portfolio (formerly Multi-Index 2010 Lifetime Portfolio)
JHANX
N/A
N/A
N/A
JRLFX
N/A
JRLHX
N/A
JRLDX
2065 Preservation Blend Portfolio (formerly Multi-Index 2065 Preservation Portfolio)
N/A
JADAX
JAANX
JAAQX
N/A
JAAUX
N/A
JAALX
2060 Preservation Blend Portfolio (formerly Multi-Index 2060 Preservation Portfolio)
N/A
JTBLX
JSATX
JPORX
N/A
JTFOX
N/A
JCHOX
2055 Preservation Blend Portfolio (formerly Multi-Index 2055 Preservation Portfolio)
N/A
JACIX
JRIUX
JRIVX
N/A
JRIWX
N/A
JRIYX
2050 Preservation Blend Portfolio (formerly Multi-Index 2050 Preservation Portfolio)
N/A
JACQX
JRINX
JRIPX
N/A
JRISX
N/A
JRIOX
2045 Preservation Blend Portfolio (formerly Multi-Index 2045 Preservation Portfolio)
N/A
JACUX
JRVRX
JRVPX
N/A
JRVSX
N/A
JRVOX
2040 Preservation Blend Portfolio (formerly Multi-Index 2040 Preservation Portfolio)
N/A
JACVX
JRRRX
JRRPX
N/A
JRRSX
N/A
JRROX
2035 Preservation Blend Portfolio (formerly Multi-Index 2035 Preservation Portfolio)
N/A
JACWX
JRYRX
JRYPX
N/A
JRYSX
N/A
JRYOX
2030 Preservation Blend Portfolio (formerly Multi-Index 2030 Preservation Portfolio)
N/A
JACYX
JRHRX
JRHPX
N/A
JRHSX
N/A
JRHOX
2025 Preservation Blend Portfolio (formerly Multi-Index 2025 Preservation Portfolio)
N/A
JACZX
JRERX
JREPX
N/A
JRESX
N/A
JREOX
Income Preservation Blend Portfolio (formerly Multi-Index Income Preservation Portfolio)
N/A
JACKX
JRFNX
JRFPX
N/A
JRFSX
N/A
JRFOX
Multimanager 2065 Lifetime Portfolio
JAAWX
N/A
JABSX
JAAZX
JABBX
JABDX
JABEX
N/A
JAAVX
Multimanager 2060 Lifetime Portfolio
JJERX
N/A
JMENX
JVIMX
JROUX
JGHTX
JESRX
N/A
JRETX
Multimanager 2055 Lifetime Portfolio
JLKLX
N/A
JHRTX
JLKNX
JLKQX
JLKSX
JLKTX
N/A
JLKUX
Multimanager 2050 Lifetime Portfolio
JLKAX
N/A
JHRPX
JLKEX
JLKGX
JLKHX
JLKRX
N/A
JLKOX
Multimanager 2045 Lifetime Portfolio
JLJAX
N/A
JHROX
JLJEX
JLJGX
JLJHX
JLJIX
N/A
JLJOX
Multimanager 2040 Lifetime Portfolio
JLIAX
N/A
JHRDX
JLIEX
JLIGX
JLIHX
JLIIX
N/A
JLIOX
Multimanager 2035 Lifetime Portfolio
JLHAX
N/A
JHRMX
JLHEX
JLHGX
JLHHX
JLHIX
N/A
JLHOX
Multimanager 2030 Lifetime Portfolio
JLFAX
N/A
JHRGX
JLFEX
JLFGX
JLFHX
JLFIX
N/A
JLFOX
Multimanager 2025 Lifetime Portfolio
JLEAX
N/A
JHRNX
JLEEX
JLEGX
JLEHX
JLEIX
N/A
JLEOX
Multimanager 2020 Lifetime Portfolio
JLDAX
N/A
JHRVX
JLDEX
JLDGX
JLDHX
JLDIX
N/A
JLDOX
Multimanager 2015 Lifetime Portfolio
JLBAX
N/A
JHREX
JLBKX
JLBGX
JLBHX
JLBJX
N/A
JLBOX
Multimanager 2010 Lifetime Portfolio
JLAAX
N/A
JHRLX
JLAEX
JLAGX
JLAHX
JLAIX
N/A
JLAOX
New Opportunities Fund
JASOX
JBSOX
JHSOX
JSSOX
JUSOX
N/A
JWSOX
JISOX
Opportunistic Fixed Income Fund
JABWX
JABOX
JABTX
N/A
N/A
N/A
JABUX
JHGDX
JIGDX
Real Estate Securities Fund
JYEBX
JABFX
JABGX
N/A
N/A
N/A
JABIX
JIREX
Science & Technology Fund
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Small Cap Growth Fund
JSJAX
JSJCX
JSJIX
N/A
N/A
N/A
JSJFX
N/A

 
 
A
C
I
R2
R4
R5
R6
NAV
1
Small Cap Value Fund
JSCAX
N/A
JSCBX
N/A
N/A
N/A
JSCCX
N/A
Strategic Income Opportunities Fund
JIPAX
JIPCX
JIPIX
JIPPX
N/A
N/A
JIPRX
N/A
U.S. Sector Rotation Fund  
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
This Statement of Additional Information (“SAI”) provides information about  each fund listed above (each a fund and collectively, the funds).  Each fund is a series of the Trust indicated above. The information in this SAI is in addition to the information that is contained in  each fund’s prospectus dated January 1, 2023, as amended and supplemented from time to time (collectively, the “Prospectus”).  The funds  may offer other share classes that are described in separate prospectuses and SAIs.
This SAI is not a prospectus. It should be read in conjunction with the Prospectus. This SAI incorporates by reference the financial statements of  each fund  for the period ended August 31, 2022, as well as the related opinion of the fund’s independent registered public accounting firm, as included in the fund’s most recent annual report to shareholders (each an “Annual Report”). The financial statements of each fund for the fiscal period ended August 31, 2022 are available through the link(s) in the following table:
A copy of a Prospectus or an Annual Report  can be obtained free of charge by contacting:
John  Hancock Signature Services, Inc.
P.O. Box 219909
Kansas City, MO 64121-9909
800-225-5291
jhinvestments.com

 
 
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1

 
GLOSSARY
Term
Definition
“1933 Act”
the Securities Act of 1933, as amended
“1940 Act”
the Investment Company Act of 1940, as amended
“Advisers Act”
the Investment Advisers Act of 1940, as amended
“Advisor”
John Hancock Investment Management LLC (formerly, John  Hancock Advisers, LLC), 200 Berkeley Street, Boston, Massachusetts 02116
“Advisory Agreement”
an investment advisory agreement or investment management contract between the Trust and the Advisor
“Affiliated Subadvisors”
Manulife Investment Management (North America) Limited and Manulife Investment Management (US) LLC, as applicable
“affiliated underlying funds”
underlying funds that are advised by John Hancock’s investment advisor or its affiliates
“BDCs”
business development companies
“Board”
Board of Trustees of the Trust
“Bond Connect”
Mutual Bond Market Access between Mainland China and Hong Kong
“Brown Brothers Harriman”
Brown Brothers Harriman & Co.
“CATS”
Certificates of Accrual on Treasury Securities
“CBOs”
Collateralized Bond Obligations
“CCO”
Chief Compliance Officer
“CDSC”
Contingent Deferred Sales Charge
“CEA”
the Commodity Exchange Act, as amended
“China A-Shares”
Chinese stock exchanges
“CIBM”
China interbank bond market
“CLOs”
Collateralized Loan Obligations
“CMOs”
Collateralized Mortgage Obligations
“Code”
the Internal Revenue Code of 1986, as amended
“COFI floaters”
Cost of Funds Index
“CPI”
Consumer Price Index
“CPI-U”
Consumer Price Index for Urban Consumers
“CPO”
Commodity Pool Operator
“CFTC”
Commodity Futures Trading Commission
“Citibank”
Citibank, N.A., 388 Greenwich Street, New York, NY 10013
“Distributor”
John Hancock Investment Management Distributors LLC (formerly, John  Hancock Funds, LLC), 200 Berkeley Street, Boston, Massachusetts 02116
“EMU”
Economic and Monetary Union
“ETFs”
Exchange-Traded Funds
“ETNs”
Exchange-Traded Notes
“EU”
European Union
“Fannie Mae”
Federal National Mortgage Association
“FHFA”
Federal Housing Finance Agency
“FHLBs”
Federal Home Loan Banks
“FICBs”
Federal Intermediate Credit Banks
“Fitch”
Fitch Ratings
“Freddie Mac”
Federal Home Loan Mortgage Corporation
“funds” or “series”
The John Hancock funds within this SAI as noted on the front cover and as the context may require
“funds of funds”
funds that seek to achieve their investment objectives by investing in underlying funds, as permitted by Section 12(d) of the 1940 Act and the rules thereunder
“GNMA”
Government National Mortgage Association
2

 
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Term
Definition
“HKSCC”
Hong Kong Securities Clearing Company
“IOs”
Interest-Only
“IRA”
Individual Retirement Account
“IRS”
Internal Revenue Service
“JHCT”
John Hancock Collateral Trust
“JH Distributors”
John Hancock Distributors, LLC
“JHLICO New York”
John Hancock Life Insurance Company of New York
“JHLICO U.S.A.”
John Hancock Life Insurance Company (U.S.A.)
“LOI”
Letter of Intention
“LIBOR”
London Interbank Offered Rate
“MAAP”
Monthly Automatic Accumulation Program
“Manulife Financial” or “MFC”
Manulife Financial, a publicly traded company based in Toronto, Canada
“Manulife IM (NA)”
Manulife Investment Management (North America) Limited (formerly, John Hancock Asset Management a Division of Manulife Asset Management (North America) Limited)
“Manulife IM (US)”
Manulife Investment Management (US) LLC (formerly, John Hancock Asset Management a Division of Manulife Asset Management (US) LLC)
“MiFID II”
Markets in Financial Instruments Directive
“Moody’s”
Moody’s Investors Service, Inc
“NAV”
Net Asset Value
“NRSRO”
Nationally Recognized Statistical Rating Organization
“NYSE”
New York Stock Exchange
“OID”
Original Issue Discount
“OTC”
Over-The-Counter
“PAC”
Planned Amortization Class
“PFS”
Personal Financial Services
“POs”
Principal-Only
“PRC”
People’s Republic of China
“REITs”
Real Estate Investment Trusts
“RIC”
Regulated Investment Company
“RPS”
John Hancock Retirement Plan Services
“SARSEP”
Salary Reduction Simplified Employee Pension Plan
“SEC”
Securities and Exchange Commission
“SEP”
Simplified Employee Pension
“SIMPLE”
Savings Incentive Match Plan for Employees
“S&P”
S&P  Global Ratings
“SLMA”
Student Loan Marketing Association
“SPACs”
Special Purpose Acquisition Companies
“State Street”
State Street Bank and Trust Company, State Street Financial Center, One Lincoln Street, Boston, Massachusetts 02111
“Stock Connect”
Hong Kong Stock Connect Program
“subadvisor”
Any subadvisors employed by John Hancock within this SAI as noted in Appendix B and as the context may require
“TAC”
Target Amortization Class
“TIGRs”
Treasury Receipts, Treasury Investors Growth Receipts
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Term
Definition
“Trust”
John Hancock Bond Trust
John Hancock California Tax-Free Income Fund
John Hancock Capital Series
John Hancock Current Interest
John Hancock Exchange-Traded Fund Trust
John Hancock Funds II
John Hancock Funds III
John Hancock Investment Trust
John Hancock Investment Trust II
John Hancock Municipal Securities Trust
John Hancock Sovereign Bond Fund
John Hancock Strategic Series
John Hancock Variable Insurance Trust
“TSA”
Tax-Sheltered Annuity
“unaffiliated underlying funds”
underlying funds that are advised by an entity other than John Hancock’s investment advisor or its affiliates
“underlying funds”
funds in which the funds of funds invest
“UK”
United Kingdom
ORGANIZATION OF THE TRUST

The Trust is organized as a Massachusetts business trust under the laws of The Commonwealth of Massachusetts and is an open-end management investment company registered under the 1940 Act.  Each of Blue Chip Growth Fund, Emerging Markets Debt Fund, Fundamental Global Franchise Fund, and Real Estate Securities Fund  is a non-diversified series of  the Trust and each other fund is a diversified series of  the Trust, as those terms are used in the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.  The funds of funds may invest in affiliated and unaffiliated underlying funds. The following table sets forth the date the Trust was organized:
Trust
Date of Organization
John Hancock Funds II
June 28, 2005
The Advisor is a Delaware limited liability company whose principal offices are located at  200 Berkeley  Street, Boston, Massachusetts 02116. The Advisor is registered as an investment advisor under the Advisers Act. The Advisor is an indirect principally owned subsidiary of JHLICO U.S.A. JHLICO U.S.A. and its subsidiaries today offer a broad range of financial products, including life insurance, annuities, 401(k) plans, long-term care insurance, college savings, and other forms of business insurance. Additional information about John Hancock may be found on the Internet at johnhancock.com. The ultimate controlling parent of the Advisor is MFC, a publicly traded company based in Toronto, Canada. MFC is the holding company of The Manufacturers Life Insurance Company and its subsidiaries, collectively known as Manulife Financial.
The Advisor has retained for each fund a subadvisor that is responsible for providing investment advice to the fund subject to the review of the Board and the overall supervision of the Advisor.
Manulife Financial is a leading international financial services group with principal operations in Asia, Canada, and the United States. Operating primarily as John  Hancock in the United States and Manulife elsewhere, it provides financial protection products and advice, insurance, as well as wealth and asset management services through its extensive network of solutions for individuals, groups, and institutions. Its global headquarters are in Toronto, Canada, and it trades as ‘MFC’ on the Toronto Stock Exchange,  NYSE, and the Philippine Stock Exchange, and under ‘945’ in Hong Kong. Manulife Financial can be found on the Internet at manulife.com.
The following table sets forth each fund’s inception date:
Fund
Commencement of Operations
Alternative Asset Allocation Fund
January 2, 2009
Blue Chip Growth Fund
October 17, 2005
Capital Appreciation Fund
October 17, 2005
Capital Appreciation Value Fund
January 6, 2011
Core Bond Fund
October 17, 2005
Emerging Markets Fund
May 1, 2007
Emerging Markets Debt Fund
January 4, 2010
Equity Income Fund
October 17, 2005
Floating Rate Income Fund
January 2, 2008
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Fund
Commencement of Operations
Fundamental Global Franchise Fund
June 29, 2012
Global Equity Fund
May 16, 2013
Health Sciences Fund
September 30, 2011
High Yield Fund
October 15, 2005
International Small Company Fund
April 28, 2006
International Strategic Equity Allocation Fund
October 17, 2016
Mid Value Fund
January 2, 2009
Multi-Asset High Income Fund
November 14, 2014
Lifestyle Blend Aggressive Portfolio
December 30, 2013
Lifestyle Blend Balanced Portfolio
December 30, 2013
Lifestyle Blend Conservative Portfolio
December 30, 2013
Lifestyle Blend Growth Portfolio
December 30, 2013
Lifestyle Blend Moderate Portfolio
December 30, 2013
2065 Lifetime Blend Portfolio
September 23, 2020
2060 Lifetime Blend Portfolio
March 30, 2016
2055 Lifetime Blend Portfolio
March 26, 2014
2050 Lifetime Blend Portfolio
November 7, 2013
2045 Lifetime Blend Portfolio
November 7, 2013
2040 Lifetime Blend Portfolio
November 7, 2013
2035 Lifetime Blend Portfolio
November 7, 2013
2030 Lifetime Blend Portfolio
November 7, 2013
2025 Lifetime Blend Portfolio
November 7, 2013
2020 Lifetime Blend Portfolio
November 7, 2013
2015 Lifetime Blend Portfolio
November 7, 2013
2010 Lifetime Blend Portfolio
November 7, 2013
2065 Preservation Blend Portfolio
September 23, 2020
2060 Preservation Blend Portfolio
March 30, 2016
2055 Preservation Blend Portfolio
March 26, 2014
2050 Preservation Blend Portfolio
April 29, 2011
2045 Preservation Blend Portfolio
April 30, 2010
2040 Preservation Blend Portfolio
April 30, 2010
2035 Preservation Blend Portfolio
April 30, 2010
2030 Preservation Blend Portfolio
April 30, 2010
2025 Preservation Blend Portfolio
April 30, 2010
Income Preservation Blend Portfolio
April 30, 2010
Multimanager 2065 Lifetime Portfolio
September 23, 2020
Multimanager 2060 Lifetime Portfolio
March 30, 2016
Multimanager 2055 Lifetime Portfolio
March 26, 2014
Multimanager 2050 Lifetime Portfolio
April 29, 2011
Multimanager 2045 Lifetime Portfolio
October 30, 2006
Multimanager 2040 Lifetime Portfolio
October 30, 2006
Multimanager 2035 Lifetime Portfolio
October 30, 2006
Multimanager 2030 Lifetime Portfolio
October 30, 2006
Multimanager 2025 Lifetime Portfolio
October 30, 2006
Multimanager 2020 Lifetime Portfolio
October 30, 2006
Multimanager 2015 Lifetime Portfolio
October 30, 2006
Multimanager 2010 Lifetime Portfolio
October 30, 2006
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Fund
Commencement of Operations
New Opportunities Fund
October 17, 2005
Opportunistic Fixed Income Fund
October 17, 2005
Real Estate Securities Fund
October 15, 2005
Science & Technology Fund
February 14, 2013
Small Cap Growth Fund
October 31, 2005
Small Cap Value Fund
December 16, 2008
Strategic Income Opportunities Fund
April 28, 2006
U.S. Sector Rotation Fund
September 26, 2016
If a fund  or share class has been in operation for a period that is shorter than the three-year fiscal period covered in this SAI, information is provided for the period the fund  or share class, as applicable, was in operation.
ADDITIONAL INVESTMENT POLICIES AND OTHER INSTRUMENTS
The principal strategies and risks of investing in each fund are described in the applicable Prospectus. Unless otherwise stated in the applicable Prospectus or this SAI, the investment objective and policies of the funds may be changed without shareholder approval. Each fund may invest in the instruments below, and such instruments and investment policies apply to each fund, but only  if and to the extent that such policies are consistent with and permitted by a fund’s investment objective and policies. Each fund may also have indirect exposure to the instruments described below through derivative contracts, if applicable. By owning shares of the underlying funds, each fund of funds indirectly invests in the securities and instruments held by the underlying funds and bears the same risks of such underlying funds.
Asset-Backed Securities
The securitization techniques used to develop mortgage securities also are being applied to a broad range of other assets. Through the use of trusts and special purpose corporations, automobile and credit card receivables are being securitized in pass-through structures similar to mortgage pass-through structures or in a pay-through structure similar to the CMO structure.
Generally, the issuers of asset-backed bonds, notes or pass-through certificates are special purpose entities and do not have any significant assets other than the receivables securing such obligations. In general, the collateral supporting asset-backed securities is of a shorter maturity than that of mortgage loans. As a result, investment in these securities should be subject to less volatility than mortgage securities. Instruments backed by pools of receivables are similar to mortgage-backed securities in that they are subject to unscheduled prepayments of principal prior to maturity. When the obligations are prepaid, a fund must reinvest the prepaid amounts in securities with the prevailing interest rates at the time. Therefore, a fund’s ability to maintain an investment including high-yielding asset-backed securities will be affected adversely to the extent that prepayments of principal must be reinvested in securities that have lower yields than the prepaid obligations. Moreover, prepayments of securities purchased at a premium could result in a realized loss.   Unless otherwise stated in its Prospectus, a fund will only invest in asset-backed securities rated, at the time of purchase, “AA” or better by S&P or Fitch or “Aa” or better by Moody’s.
As with mortgage securities, asset-backed securities are often backed by a pool of assets representing the obligation of a number of different parties and use similar credit enhancement techniques. For a description of the types of credit enhancement that may accompany asset-backed securities, see “Types of Credit Support” below. When a fund invests in asset-backed securities, it will not limit its investments in asset-backed securities to those with credit enhancements. Although asset-backed securities are not generally traded on a national securities exchange, such securities are widely traded by brokers and dealers, and will not be considered illiquid securities for the purposes of the investment restriction on illiquid securities under the sub-section “Illiquid Securities” in this section below.
Types of Credit Support. To lessen the impact of an obligor’s failure to make payments on underlying assets, mortgage securities and asset-backed securities may contain elements of credit support. Such credit support falls into two categories:
liquidity protection; and
 
default protection.
 
Liquidity protection refers to the provision of advances, generally by the entity administering the pool of assets, to ensure that the pass-through of payments due on the underlying pool of assets occurs in a timely fashion. Default protection provides protection against losses resulting from ultimate default and enhances the likelihood of ultimate payment of the obligations on at least a portion of the assets in the pool. This protection may be provided through guarantees, insurance policies or letters of credit obtained by the issuer or sponsor from third parties, through various means of structuring the transaction or through a combination of such approaches. A fund will not pay any additional fees for such credit support, although the existence of credit support may increase the price of a security.
Some examples of credit support include:
“senior-subordinated securities” (multiple class securities with one or more classes subordinate to other classes as to the payment of principal thereof and interest thereon, with the result that defaults on the underlying assets are borne first by the holders of the subordinated class);
 
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creation of “reserve funds” (where cash or investments, sometimes funded from a portion of the payments on the underlying assets, are held in reserve against future losses); and
 
“over-collateralization” (where the scheduled payments on, or the principal amount of, the underlying assets exceed those required to make payment on the securities and pay any servicing or other fees).
 
The ratings of mortgage-backed securities and asset-backed securities for which third-party credit enhancement provides liquidity protection or default protection are generally dependent upon the continued creditworthiness of the provider of the credit enhancement. The ratings of these securities could be reduced in the event of deterioration in the creditworthiness of the credit enhancement provider even in cases where the delinquency and loss experienced on the underlying pool of assets is better than expected.
The degree of credit support provided for each issue is generally based on historical information concerning the level of credit risk associated with the underlying assets. Delinquency or loss greater than anticipated could adversely affect the return on an investment in mortgage securities or asset-backed securities.
Collateralized Debt Obligations.  CBOs,  CLOs, other collateralized debt obligations, and other similarly structured securities (collectively, “CDOs”) are types of asset-backed securities. A CBO is a trust that is often backed by a diversified pool of high risk, below investment grade fixed-income securities. The collateral can be from many different types of fixed-income securities such as high yield debt, residential privately issued mortgage-related securities, commercial privately issued mortgage-related securities, trust preferred securities and emerging market debt. A CLO is a trust typically collateralized by a pool of loans, which may include, among others, domestic and foreign senior secured loans, senior unsecured loans, and subordinate corporate loans, including loans that may be rated below investment grade or equivalent unrated loans. Other CDOs are trusts backed by other types of assets representing obligations of various parties. CDOs may charge management fees and administrative expenses.
In a CDO structure, the cash flows from the trust are split into two or more portions, called tranches, varying in risk and yield. The riskiest portion is the “equity” tranche which bears the bulk of defaults from the bonds or loans in the trust and serves to protect the other, more senior tranches from default in all but the most severe circumstances. Since it is partially protected from defaults, a senior tranche from a CDO trust typically has a higher rating and lower yield than its underlying securities, and can be rated investment grade. Despite the protection from the equity tranche, CDO tranches can experience substantial losses due to actual defaults, increased sensitivity to defaults due to collateral default and disappearance of protecting tranches, market anticipation of defaults, as well as aversion to CDO securities as a class. In the case of all CDO tranches, the market prices of and yields on tranches with longer terms to maturity tend to be more volatile than those of tranches with shorter terms to maturity due to the greater volatility and uncertainty of cash flows.
Borrowing
Unless otherwise prohibited, a  fund may borrow money in an amount that does not exceed 33% of its total assets. Borrowing by  a fund involves leverage, which may exaggerate any increase or decrease in  a fund’s investment performance and in that respect may be considered a speculative practice. The interest that  a fund must pay on any borrowed money, additional fees to maintain a line of credit or any minimum average balances required to be maintained are additional costs that will reduce or eliminate any potential investment income and may offset any capital gains. Unless the appreciation and income, if any, on the asset acquired with borrowed funds exceed the cost of borrowing, the use of leverage will diminish the investment performance of  a fund.
Brady Bonds
Brady Bonds are debt securities issued under the framework of the “Brady Plan,” an initiative announced by former U.S. Treasury Secretary Nicholas F. Brady in 1989 as a mechanism for debtor nations to restructure their outstanding external commercial bank indebtedness. The Brady Plan framework, as it has developed, involves the exchange of external commercial bank debt for newly issued bonds (“Brady Bonds”). Brady Bonds also may be issued in respect of new money being advanced by existing lenders in connection with the debt restructuring. Brady Bonds issued to date generally have maturities between 15 and 30 years from the date of issuance and have traded at a deep discount from their face value. In addition to Brady Bonds, investments in emerging market governmental obligations issued as a result of debt restructuring agreements outside of the scope of the Brady Plan are available.
Agreements implemented under the Brady Plan to date are designed to achieve debt and debt-service reduction through specific options negotiated by a debtor nation with its creditors. As a result, the financial packages offered by each country differ. The types of options have included:
the exchange of outstanding commercial bank debt for bonds issued at 100% of face value that carry a below-market stated rate of interest (generally known as par bonds);
 
bonds issued at a discount from face value (generally known as discount bonds);
 
bonds bearing an interest rate which increases over time; and
 
bonds issued in exchange for the advancement of new money by existing lenders.
 
Discount bonds issued to date under the framework of the Brady Plan have generally borne interest computed semiannually at a rate equal to 13/16th of one percent above current six-month LIBOR. Regardless of the stated face amount and interest rate of the various types of Brady Bonds, when investing in Brady Bonds, a fund will purchase Brady Bonds in secondary markets in which the price and yield to the investor reflect market conditions at the time of purchase.
Certain sovereign bonds are entitled to “value recovery payments” in certain circumstances, which in effect constitute supplemental interest payments but generally are not collateralized. Certain Brady Bonds have been collateralized as to principal due at maturity (typically 15 to 30 years from the
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date of issuance) by U.S. Treasury zero coupon bonds with a maturity equal to the final maturity of such Brady Bonds, although the collateral is not available to investors until the final maturity of the Brady Bonds. Collateral purchases are financed by the International Monetary Fund (the “IMF”), the World Bank and the debtor nations’ reserves. In addition, interest payments on certain types of Brady Bonds may be collateralized by cash or high-grade securities in amounts that typically represent between 12 and 18 months of interest accruals on these instruments, with the balance of the interest accruals being uncollateralized.
A fund may purchase Brady Bonds with no or limited collateralization, and must rely for payment of interest and (except in the case of principal collateralized Brady Bonds) principal primarily on the willingness and ability of the foreign government to make payment in accordance with the terms of the Brady Bonds.
Brady Bonds issued to date are purchased and sold in secondary markets through U.S. securities dealers and other financial institutions and are generally maintained through European transactional securities depositories. A substantial portion of the Brady Bonds and other sovereign debt securities in which a fund invests are likely to be acquired at a discount.
Canadian and Provincial Government and Crown Agency Obligations
Canadian Government Obligations. Canadian government obligations are debt securities issued or guaranteed as to principal or interest by the government of Canada pursuant to authority granted by the Parliament of Canada and approved by the Governor in Council, where necessary. These securities include treasury bills, notes, bonds, debentures and marketable government of Canada loans.
Canadian Crown Obligations. Canadian Crown agency obligations are debt securities issued or guaranteed by a Crown corporation, company or agency (“Crown Agencies”) pursuant to authority granted by the Parliament of Canada and approved by the Governor in Council, where necessary. Certain Crown Agencies are by statute agents of Her Majesty in right of Canada, and their obligations, when properly authorized, constitute direct obligations of the government of Canada. These obligations include, but are not limited to, those issued or guaranteed by the:
Export Development Corporation;
 
Farm Credit Corporation;
 
Federal Business Development Bank; and
 
Canada Post Corporation.
 
In addition, certain Crown Agencies that are not, by law, agents of Her Majesty may issue obligations that, by statute, the Governor in Council may authorize the Minister of Finance to guarantee on behalf of the government of Canada. Other Crown Agencies that are not, by law, agents of Her Majesty may issue or guarantee obligations not entitled to be guaranteed by the government of Canada. No assurance can be given that the government of Canada will support the obligations of Crown Agencies that are not agents of Her Majesty, which it has not guaranteed, since it is not obligated to do so by law.
Provincial Government Obligations. Provincial Government obligations are debt securities issued or guaranteed as to principal or interest by the government of any province of Canada pursuant to authority granted by the provincial Legislature and approved by the Lieutenant Governor in Council of such province, where necessary. These securities include treasury bills, notes, bonds and debentures.
Provincial Crown Agency Obligations. Provincial Crown Agency obligations are debt securities issued or guaranteed by a provincial Crown corporation, company or agency (“Provincial Crown Agencies”) pursuant to authority granted by the provincial Legislature and approved by the Lieutenant Governor in Council of such province, where necessary. Certain Provincial Crown Agencies are by statute agents of Her Majesty in right of a particular province of Canada, and their obligations, when properly authorized, constitute direct obligations of such province. Other Provincial Crown Agencies that are not, by law, agents of Her Majesty in right of a particular province of Canada may issue obligations that, by statute, the Lieutenant Governor in Council of such province may guarantee, or may authorize the Treasurer thereof to guarantee, on behalf of the government of such province. Finally, other Provincial Crown Agencies that are not, by law, agencies of Her Majesty may issue or guarantee obligations not entitled to be guaranteed by a provincial government. No assurance can be given that the government of any province of Canada will support the obligations of Provincial Crown Agencies that are not agents of Her Majesty and that it has not guaranteed, as it is not obligated to do so by law. Provincial Crown Agency obligations described above include, but are not limited to, those issued or guaranteed by a:
provincial railway corporation;
 
provincial hydroelectric or power commission or authority;
 
provincial municipal financing corporation or agency; and
 
provincial telephone commission or authority.
 
Certificates of Deposit, Time Deposits and Bankers’ Acceptances
Certificates of Deposit. Certificates of deposit are certificates issued against funds deposited in a bank or a savings and loan. They are issued for a definite period of time and earn a specified rate of return.
Time Deposits. Time deposits are non-negotiable deposits maintained in banking institutions for specified periods of time at stated interest rates.
Bankers’ Acceptances. Bankers’ acceptances are short-term credit instruments evidencing the obligation of a bank to pay a draft which has been drawn on it by a customer. These instruments reflect the obligations both of the bank and of the drawer to pay the face amount of the instrument upon maturity. They are primarily used to finance the import, export, transfer or storage of goods. They are “accepted” when a bank guarantees their payment at maturity.
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These obligations are not insured by the Federal Deposit Insurance Corporation.
Commercial Paper and Short-Term Notes
Commercial paper consists of unsecured promissory notes issued by corporations. Issues of commercial paper and short-term notes will normally have maturities of less than nine months and fixed rates of return, although such instruments may have maturities of up to one year.
Variable Amount Master Demand Notes. Commercial paper obligations may include variable amount master demand notes. Variable amount master demand notes are obligations that permit the investment of fluctuating amounts at varying rates of interest pursuant to direct arrangements between a fund, as lender, and the borrower. These notes permit daily changes in the amounts borrowed. The investing (i.e., “lending”) fund has the right to increase the amount under the note at any time up to the full amount provided by the note agreement, or to decrease the amount, and the borrower may prepay up to the full amount of the note without penalty. Because variable amount master demand notes are direct lending arrangements between the lender and borrower, it is not generally contemplated that such instruments will be traded. There is no secondary market for these notes, although they are redeemable (and thus immediately repayable by the borrower) at face value, plus accrued interest, at any time.
Except in the case of  Opportunistic Fixed Income Fund, an affiliated underlying fund, a  subadvisor will only invest in variable amount master demand notes issued by companies that, at the date of investment, have an outstanding debt issue rated “Aaa” or “Aa” by Moody’s or “AAA” or “AA” by S&P or Fitch, and that the subadvisor has determined present minimal risk of loss.  A subadvisor will look generally at the financial strength of the issuing company as “backing” for the note and not to any security interest or supplemental source, such as a bank letter of credit. A variable amount master demand note will be valued on each day a NAV is determined. The NAV generally will be equal to the face value of the note plus accrued interest unless the financial position of the issuer is such that its ability to repay the note when due is in question.
Conversion of Debt Securities
In the event debt securities held by  a fund are converted to or exchanged for equity securities, the fund may continue to hold such equity securities, but only if and to the extent consistent with and permitted by its investment objective and policies.
Convertible Securities
Convertible securities may include corporate notes or preferred securities. Investments in convertible securities are not subject to the rating criteria with respect to non-convertible debt obligations. As with all debt securities, the market value of convertible securities tends to decline as interest rates increase and, conversely, to increase as interest rates decline. The market value of convertible securities can also be heavily dependent upon the changing value of the equity securities into which such securities are convertible, depending on whether the market price of the underlying security exceeds the conversion price. Convertible securities generally rank senior to common stocks in an issuer’s capital structure and consequently entail less risk than the issuer’s common stock. However, the extent to which such risk is reduced depends upon the degree to which the convertible security sells above its value as a fixed-income security.
Corporate Obligations
Corporate obligations are bonds and notes issued by corporations to finance long-term credit needs.
Depositary Receipts
Securities of foreign issuers may include American Depositary Receipts, European Depositary Receipts, Global Depositary Receipts, International Depositary Receipts, and Non-Voting Depositary Receipts (“ADRs,” “EDRs,” “GDRs,” “IDRs,” and “NVDRs,” respectively, and collectively, “Depositary Receipts”). Depositary Receipts are certificates typically issued by a bank or trust company that give their holders the right to receive securities issued by a foreign or domestic corporation.
ADRs are U.S. dollar-denominated securities backed by foreign securities deposited in a U.S. securities depository. ADRs are created for trading in the U.S. markets. The value of an ADR will fluctuate with the value of the underlying security and will reflect any changes in exchange rates. An investment in ADRs involves risks associated with investing in foreign securities. Issuers of unsponsored ADRs are not contractually obligated to disclose material information in the United States, and, therefore, there may not be a correlation between that information and the market value of an unsponsored ADR.
EDRs, GDRs, IDRs, and NVDRs are receipts evidencing an arrangement with a foreign bank or exchange affiliate similar to that for ADRs and are designed for use in foreign securities markets. EDRs, GDRs, IDRs, and NVDRs are not necessarily quoted in the same currency as the underlying security. NVDRs do not have voting rights.
Exchange-Traded Notes
ETNs are senior, unsecured, unsubordinated debt securities the returns of which are linked to the performance of a particular market benchmark or strategy, minus applicable fees. ETNs are traded on an exchange (e.g., the NYSE) during normal trading hours; however, investors also can hold ETNs until they mature. At maturity, the issuer pays to the investor a cash amount equal to the principal amount, subject to the day’s market benchmark or strategy factor. ETNs do not make periodic coupon payments or provide principal protection. ETNs are subject to credit risk, including the credit risk of the issuer, and the value of the ETN may drop due to a downgrade in the issuer’s credit rating, despite the underlying market benchmark or strategy remaining unchanged. The value of an ETN also may be influenced by time to maturity, level of supply and demand for the ETN, volatility and lack of liquidity in underlying assets, changes in the applicable interest rates, changes in the issuer’s credit rating, and economic, legal, political, or geographic events that affect the referenced underlying asset. When a fund invests in ETNs, it will bear its proportionate share of any fees and expenses borne by the ETN. A decision by a fund to sell ETN holdings may be limited by the availability of a secondary market. In addition, although an ETN may be listed on an exchange, the issuer may not be required to maintain the listing, and there can be no assurance that a secondary market will exist for an ETN.
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ETNs also are subject to tax risk. No assurance can be given that the IRS will accept, or a court will uphold, how a fund characterizes and treats ETNs for tax purposes.
An ETN that is tied to a specific market benchmark or strategy may not be able to replicate and maintain exactly the composition and relative weighting of securities, commodities or other components in the applicable market benchmark or strategy. Some ETNs that use leverage can, at times, be relatively illiquid, and thus they may be difficult to purchase or sell at a fair price. Leveraged ETNs are subject to the same risk as other instruments that use leverage in any form. The market value of ETNs may differ from their market benchmark or strategy. This difference in price may be due to the fact that the supply and demand in the market for ETNs at any point in time is not always identical to the supply and demand in the market for the securities, commodities or other components underlying the market benchmark or strategy that the ETN seeks to track. As a result, there may be times when an ETN trades at a premium or discount to its market benchmark or strategy.
Fixed-Income Securities
Investment grade bonds are rated at the time of purchase in the four highest rating categories by a  NRSRO, such as those rated “Aaa,” “Aa,” “A” and “Baa” by Moody’s, or “AAA,” “AA,” “A” and “BBB” by S&P or Fitch. Obligations rated in the lowest of the top four rating categories (such as “Baa” by Moody’s or “BBB” by S&P or Fitch) may have speculative characteristics and changes in economic conditions or other circumstances are more likely to lead to a weakened capacity to make principal and interest payments, including a greater possibility of default or bankruptcy of the issuer, than is the case with higher grade bonds. Subsequent to its purchase by a fund, an issue of securities may cease to be rated or its rating may be reduced below the minimum required for purchase by a fund. In addition, it is possible that Moody’s, S&P, Fitch and other NRSROs might not timely change their ratings of a particular issue to reflect subsequent events. None of these events will require the sale of the securities by a fund, although a subadvisor will consider these events in determining whether it should continue to hold the securities.
In general, the ratings of Moody’s, S&P, and Fitch represent the opinions of these agencies as to the quality of the securities that they rate. It should be emphasized however, that ratings are relative and subjective and are not absolute standards of quality. These ratings will be used by a fund as initial criteria for the selection of portfolio securities. Among the factors that will be considered are the long-term ability of the issuer to pay principal and interest and general economic trends. Appendix A contains further information concerning the ratings of Moody’s, S&P, and Fitch and their significance.
Foreign Government Securities
Foreign government securities include securities issued or guaranteed by foreign governments (including political subdivisions) or their authorities, agencies, or instrumentalities or by supra-national agencies. Different kinds of foreign government securities have different kinds of government support. For example, some foreign government securities are supported by the full faith and credit of a foreign national government or political subdivision and some are not. Foreign government securities of some countries may involve varying degrees of credit risk as a result of financial or political instability in those countries and the possible inability of a fund to enforce its rights against the foreign government issuer. As with other fixed income securities, sovereign issuers may be unable or unwilling to make timely principal or interest payments. Supra-national agencies are agencies whose member nations make capital contributions to support the agencies’ activities.
High Yield (High Risk) Domestic Corporate Debt Securities
High yield corporate debt securities (also known as “junk bonds”) include bonds, debentures, notes, bank loans, credit-linked notes and commercial paper. Most of these debt securities will bear interest at fixed rates, except bank loans, which usually have floating rates. Bonds also may have variable rates of interest, and debt securities may involve equity features, such as equity warrants or convertible outright and participation features (i.e., interest or other payments, often in addition to a fixed rate of return, that are based on the borrower’s attainment of specified levels of revenues, sales or profits and thus enable the holder of the security to share in the potential success of the venture). Today, much high yield debt is used for general corporate purposes, such as financing capital needs or consolidating and paying down bank lines of credit.
The secondary market for high yield U.S. corporate debt securities is concentrated in relatively few market makers and is dominated by institutional investors, including funds, insurance companies and other financial institutions. Accordingly, the secondary market for such securities is not as liquid as, and is more volatile than, the secondary market for higher-rated securities. In addition, market trading volume for high yield U.S. corporate debt securities is generally lower and the secondary market for such securities could shrink or disappear suddenly and without warning as a result of adverse market or economic conditions, independent of any specific adverse changes in the condition of a particular issuer. The lack of sufficient market liquidity may cause a fund to incur losses because it will be required to effect sales at a disadvantageous time and then only at a substantial drop in price. These factors may have an adverse effect on the market price and a fund’s ability to dispose of particular portfolio investments. A less liquid secondary market also may make it more difficult for a fund to obtain precise valuations of the high yield securities in its portfolio.
A  fund is not obligated to dispose of securities whose issuers subsequently are in default or that are downgraded below the rating requirements that the fund imposes at the time of purchase.
Hybrid Instruments
Hybrid instruments (a type of potentially high-risk derivative) combine the elements of futures contracts or options with those of debt, preferred equity or a depository instrument.
Characteristics of Hybrid Instruments. Generally, a hybrid instrument is a debt security, preferred stock, depository share, trust certificate, certificate of deposit or other evidence of indebtedness on which a portion of or all interest payments, and/or the principal or stated amount payable at maturity, redemption or retirement, is determined by reference to the following:
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prices, changes in prices, or differences between prices of securities, currencies, intangibles, goods, articles or commodities (collectively, “underlying assets”); or
 
an objective index, economic factor or other measure, such as interest rates, currency exchange rates, commodity indices, and securities indices (collectively, “benchmarks”).
 
Hybrid instruments may take a variety of forms, including, but not limited to:
debt instruments with interest or principal payments or redemption terms determined by reference to the value of a currency or commodity or securities index at a future point in time;
 
preferred stock with dividend rates determined by reference to the value of a currency; or
 
convertible securities with the conversion terms related to a particular commodity.
 
Uses of Hybrid Instruments. Hybrid instruments provide an efficient means of creating exposure to a particular market, or segment of a market, with the objective of enhancing total return. For example, a fund may wish to take advantage of expected declines in interest rates in several European countries, but avoid the transaction costs associated with buying and currency-hedging the foreign bond positions.
One approach is to purchase a U.S. dollar-denominated hybrid instrument whose redemption price is linked to the average three-year interest rate in a designated group of countries. The redemption price formula would provide for payoffs of greater than par if the average interest rate was lower than a specified level, and payoffs of less than par if rates were above the specified level. Furthermore, the investing fund could limit the downside risk of the security by establishing a minimum redemption price so that the principal paid at maturity could not be below a predetermined minimum level if interest rates were to rise significantly.
The purpose of this type of arrangement, known as a structured security with an embedded put option, is to give  a fund the desired European bond exposure while avoiding currency risk, limiting downside market risk, and lowering transactions costs. Of course, there is no guarantee that such a strategy will be successful and the value of  a fund may decline if, for example, interest rates do not move as anticipated or credit problems develop with the issuer of the hybrid instrument.
Structured Notes. Structured notes include investments in an entity, such as a trust, organized and operated solely for the purpose of restructuring the investment characteristics of various securities. This type of restructuring involves the deposit or purchase of specified instruments and the issuance of one or more classes of securities backed by, or representing interests, in the underlying instruments. The cash flow on the underlying instruments may be apportioned among the newly issued structured notes to create securities with different investment characteristics, such as varying maturities, payment priorities or interest rate provisions. The extent of the income paid by the structured notes is dependent on the cash flow of the underlying instruments.
Illiquid Securities
A fund may not invest more than 15% of its net assets in securities that cannot be sold or disposed of in seven calendar days or less without the sale or disposition significantly changing the market value of the investment (“illiquid securities”).   Investment in illiquid securities involves the risk that, because of the lack of consistent market demand for such securities, a fund may be forced to sell them at a discount from the last offer price. To the extent that an investment is deemed to be an illiquid investment or a less liquid investment, a fund can expect to be exposed to greater liquidity risk.
Illiquid securities may include, but are not limited to: (a) securities (except for Section 4(a)(2) Commercial Paper, discussed below) that are not eligible for resale pursuant to Rule 144A under the 1933 Act; (b) repurchase agreements maturing in more than seven days (except for those that can be terminated after a notice period of seven days or less); (c) IOs and POs of non-governmental issuers; (d) time deposits maturing in more than seven days; (e) federal fund loans maturing in more than seven days; (f) bank loan participation interests; (g) foreign government loan participations; (h) municipal leases and participations therein; and (i) any other securities or other investments for which a liquid secondary market does not exist.
The  Trust has  implemented a written liquidity risk management program (the “LRM Program”) and related procedures to manage the liquidity risk of  a fund in accordance with Rule 22e-4 under the 1940 Act (“Rule 22e-4”). Rule 22e-4 defines “liquidity risk” as the risk that a fund could not meet requests to redeem shares issued by the fund without significant dilution of the remaining investors’ interests in the fund. The Board has designated the Advisor to serve as the administrator of the LRM Program and the related procedures. As a part of the LRM Program, the Advisor is responsible to identify illiquid investments and categorize the relative liquidity of  a fund’s investments in accordance with Rule 22e-4. Under the LRM Program, the Advisor assesses, manages, and periodically reviews  a  fund’s liquidity risk, and is responsible to make periodic reports to the Board and the SEC regarding the liquidity of  a  fund’s investments, and to notify the Board and the SEC of certain liquidity events specified in Rule 22e-4. The liquidity of  a  fund’s portfolio investments is determined based on relevant market, trading and investment-specific considerations under the LRM Program.
Commercial paper issued in reliance on Section 4(a)(2) of the 1933 Act (“Section 4(a)(2) Commercial Paper”) is restricted as to its disposition under federal securities law, and generally is sold to institutional investors, such as the funds, who agree that they are purchasing the paper for investment purposes and not with a view to public distribution. Any resale by the purchaser must be made in an exempt transaction. Section 4(a)(2) Commercial Paper normally is resold to other institutional investors, like the funds, through or with the assistance of the issuer or investment dealers who make a market in Section 4(a)(2) Commercial Paper, thus providing liquidity.
If the Advisor determines, pursuant to the LRM Program and related procedures, that specific Section 4(a)(2) Commercial Paper or securities that are restricted as to resale but for which a ready market is available pursuant to an exemption provided by Rule 144A under the 1933 Act or other exemptions from the registration requirements of the 1933 Act are liquid, they will not be subject to  a fund’s limitation on investments in illiquid
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securities. Investing in Section 4(a)(2) Commercial Paper could have the effect of increasing the level of illiquidity in  a fund if qualified institutional buyers become for a time uninterested in purchasing these restricted securities.
Index-Related Securities (“Equity Equivalents”)
A fund may invest in certain types of securities that enable investors to purchase or sell shares in a basket of securities that seeks to track the performance of an underlying index or a portion of an index. Such Equity Equivalents include, among others DIAMONDS (interests in a basket of securities that seeks to track the performance of the Dow Jones Industrial Average), SPDRs or S&P Depositary Receipts (an exchange-traded fund that tracks the S&P 500 Index). Such securities are similar to index mutual funds, but they are traded on various stock exchanges or secondary markets. The value of these securities is dependent upon the performance of the underlying index on which they are based. Thus, these securities are subject to the same risks as their underlying indices as well as the securities that make up those indices. For example, if the securities comprising an index that an index-related security seeks to track perform poorly, the index-related security will lose value.
Equity Equivalents may be used for several purposes, including to simulate full investment in the underlying index while retaining a cash balance for portfolio management purposes, to facilitate trading, to reduce transaction costs or to seek higher investment returns where an Equity Equivalent is priced more attractively than securities in the underlying index. Because the expense associated with an investment in Equity Equivalents may be substantially lower than the expense of small investments directly in the securities comprising the indices they seek to track, investments in Equity Equivalents may provide a cost-effective means of diversifying a fund’s assets across a broad range of securities.
To the extent a fund invests in securities of other investment companies, including Equity Equivalents, fund shareholders would indirectly pay a portion of the operating costs of such companies in addition to the expenses of its own operations. These costs include management, brokerage, shareholder servicing and other operational expenses. Indirectly, if a fund invests in Equity Equivalents, shareholders may pay higher operational costs than if they owned the underlying investment companies directly. Additionally, a fund’s investments in such investment companies are subject to limitations under the 1940 Act and market availability.
The prices of Equity Equivalents are derived and based upon the securities held by the particular investment company. Accordingly, the level of risk involved in the purchase or sale of an Equity Equivalent is similar to the risk involved in the purchase or sale of traditional common stock, with the exception that the pricing mechanism for such instruments is based on a basket of stocks. The market prices of Equity Equivalents are expected to fluctuate in accordance with both changes in the NAVs of their underlying indices and the supply and demand for the instruments on the exchanges on which they are traded. Substantial market or other disruptions affecting Equity Equivalents could adversely affect the liquidity and value of the shares of a fund.
Indexed Securities
Indexed securities are instruments whose prices are indexed to the prices of other securities, securities indices, currencies, or other financial indicators. Indexed securities typically, but not always, are debt securities or deposits whose value at maturity or coupon rate is determined by reference to a specific instrument or statistic.
Currency-indexed securities typically are short-term to intermediate-term debt securities whose maturity values or interest rates are determined by reference to the values of one or more specified foreign currencies, and may offer higher yields than U.S. dollar-denominated securities. Currency-indexed securities may be positively or negatively indexed; that is, their maturity value may increase when the specified currency value increases, resulting in a security that performs similarly to a foreign denominated instrument, or their maturity value may decline when foreign currencies increase, resulting in a security whose price characteristics are similar to a put on the underlying currency. Currency-indexed securities also may have prices that depend on the values of a number of different foreign currencies relative to each other.
The performance of indexed securities depends to a great extent on the performance of the security, currency, or other instrument to which they are indexed, and also may be influenced by interest rate changes in the United States and abroad. Indexed securities may be more volatile than the underlying instruments. Indexed securities also are subject to the credit risks associated with the issuer of the security, and their values may decline substantially if the issuer’s creditworthiness deteriorates. Issuers of indexed securities have included banks, corporations, and certain U.S. government agencies. An indexed security may be leveraged to the extent that the magnitude of any change in the interest rate or principal payable on an indexed security is a multiple of the change in the reference price.
Inflation-Indexed Bonds
Inflation-indexed bonds are debt instruments whose principal and/or interest value are adjusted periodically according to a rate of inflation (usually a CPI). Two structures are most common. The U.S. Treasury and some other issuers use a structure that accrues inflation into the principal value of the bond. Most other issuers pay out the inflation accruals as part of a semiannual coupon.
U.S. Treasury Inflation Protected Securities (“TIPS”) currently are issued with maturities of five, ten, or thirty years, although it is possible that securities with other maturities will be issued in the future. The principal amount of TIPS adjusts for inflation, although the inflation-adjusted principal is not paid until maturity. Semiannual coupon payments are determined as a fixed percentage of the inflation-adjusted principal at the time the payment is made.
If the rate measuring inflation falls, the principal value of inflation-indexed bonds will be adjusted downward, and consequently the interest payable on these securities (calculated with respect to a smaller principal amount) will be reduced. At maturity, TIPS are redeemed at the greater of their inflation-adjusted principal or at the par amount at original issue. If an inflation-indexed bond does not provide a guarantee of principal at maturity, the adjusted principal value of the bond repaid at maturity may be less than the original principal.
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The value of inflation-indexed bonds is expected to change in response to changes in real interest rates. Real interest rates in turn are tied to the relationship between nominal interest rates and the rate of inflation. For example, if inflation were to rise at a faster rate than nominal interest rates, real interest rates would likely decline, leading to an increase in value of inflation-indexed bonds. In contrast, if nominal interest rates increase at a faster rate than inflation, real interest rates would likely rise, leading to a decrease in value of inflation-indexed bonds.
While these securities, if held to maturity, are expected to be protected from long-term inflationary trends, short-term increases in inflation may lead to a decline in value. If nominal interest rates rise due to reasons other than inflation (for example, due to an expansion of non-inflationary economic activity), investors in these securities may not be protected to the extent that the increase in rates is not reflected in the bond’s inflation measure.
The inflation adjustment of TIPS is tied to the CPI-U, which is calculated monthly by the U.S. Bureau of Labor Statistics. The CPI-U is a measurement of price changes in the cost of living, made up of components such as housing, food, transportation, and energy. There can be no assurance that the CPI-U will accurately measure the real rate of inflation in the prices of goods and services.
Interfund Lending
Pursuant to an exemptive order issued by the SEC, a fund may lend money to, and borrow money from, other funds advised by the Advisor or any other investment advisor under common control with the Advisor, subject to the fundamental restrictions on borrowing and lending applicable to the fund. Each fund is authorized to participate fully in this program.
A fund will borrow through the program only when the costs are equal to or lower than the cost of bank loans, and a fund will lend through the program only when the returns are higher than those available from an investment in overnight repurchase agreements. Interfund loans and borrowings normally extend overnight, but can have a maximum duration of seven days. Loans may be called on one day’s notice. A fund may have to borrow from a bank at a higher interest rate if an interfund loan is called or not renewed. Any delay in repayment to a lending fund or from a borrowing fund could result in a lost investment opportunity or additional borrowing costs.
Investments in Creditors’ Claims
Creditors’ claims in bankruptcy (“Creditors’ Claims”) are rights to payment from a debtor under the U.S. bankruptcy laws. Creditors’ Claims may be secured or unsecured. A secured claim generally receives priority in payment over unsecured claims.
Sellers of Creditors’ Claims can either be: (i) creditors that have extended unsecured credit to the debtor company (most commonly trade suppliers of materials or services); or (ii) secured creditors (most commonly financial institutions) that have obtained collateral to secure an advance of credit to the debtor. Selling a Creditors’ Claim offers the creditor an opportunity to turn a claim that otherwise might not be satisfied for many years into liquid assets.
A Creditors’ Claim may be purchased directly from a creditor although most are purchased through brokers. A Creditors’ Claim can be sold as a single claim or as part of a package of claims from several different bankruptcy filings. Purchasers of Creditors’ Claims may take an active role in the reorganization process of the bankrupt company and, in certain situations in which a Creditors’ Claim is not paid in full, the claim may be converted into stock of the reorganized debtor.
Although Creditors’ Claims can be sold to other investors, the market for Creditors’ Claims is not liquid and, as a result, a purchaser of a Creditors’ Claim may be unable to sell the claim or may have to sell it at a drastically reduced price. There is no guarantee that any payment will be received from a Creditors’ Claim, especially in the case of unsecured claims.
Investment in Other Investment Companies
A fund may invest in other investment companies (including closed-end investment companies, unit investment trusts, open-end investment companies, investment companies exempted from registration under the 1940 Act pursuant to the rules thereunder and other pooled vehicles) to the extent permitted by federal securities laws, including Section 12 of the 1940 Act, and the rules, regulations and interpretations thereunder. A fund may invest in other investment companies beyond the statutory limits set forth in Section 12 of the 1940 Act (statutory limits)  to the extent permitted by an exemptive rule adopted by the SEC or pursuant to an exemptive order obtained from the SEC.
In October 2020, the SEC adopted Rule 12d1-4, which became effective on January 19, 2021, and permits a fund to invest in other investment companies beyond the statutory limits, subject to certain conditions. Compliance with Rule 12d1-4 is  required  as of  January 19, 2022.
Investing in other investment companies involves substantially the same risks as investing directly in the underlying instruments, but the total return on such investments at the investment company-level may be reduced by the operating expenses and fees of such other investment companies, including advisory fees. Certain types of investment companies, such as closed-end investment companies, issue a fixed number of shares that trade on a stock exchange or may involve the payment of substantial premiums above the value of such investment companies’ portfolio securities when traded  OTC or at discounts to their NAVs. Others are continuously offered at NAV, but also may be traded in the secondary market.
Blue Chip Growth Fund, Capital Appreciation Value Fund, Health Sciences Fund, and Equity Income Fund also may invest in shares of certain internal T. Rowe Price funds (collectively, the “T. Rowe Funds”), consistent with each such fund’s investment objective and policies. In order to prevent these funds from paying duplicate management fees, the value of shares of the T. Rowe Funds held in a T. Rowe Price-subadvised fund’s portfolio will be excluded from the fund’s total assets in calculating the subadvisory fees payable to T. Rowe Price.
Lending of Securities
A fund  may lend its securities so long as such loans do not represent more than 331/3% of its total assets. As collateral for the loaned securities, the borrower gives the lending portfolio collateral equal to at least 100% of the value of the loaned securities. The collateral will consist of cash (including
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U.S. dollars and foreign currency), cash equivalents or securities issued or guaranteed by the U.S. government or its agencies or instrumentalities. The borrower must also agree to increase the collateral if the value of the loaned securities increases. If the market value of the loaned securities declines, the borrower may request that some collateral be returned.
During the existence of the loan,  a fund  will receive from the borrower amounts equivalent to any dividends, interest or other distributions on the loaned securities, as well as interest on such amounts. If the fund  receives a payment in lieu of dividends (a “substitute payment”) with respect to securities on loan pursuant to a securities lending transaction, such income will not be eligible for the dividends-received deduction (the “DRD”) for corporate shareholders or for treatment as qualified dividend income for individual shareholders. The DRD and qualified dividend income are discussed more fully in this SAI under “Additional Information Concerning Taxes.”  Because Class 1 shares of the  funds are held directly by insurance companies affiliated with the Advisor, such insurance companies, rather than individuals who select the funds as investment options under variable insurance contracts, would receive the benefit of any DRD. As a result, a decision by the Advisor or an affiliated subadvisor for a particular fund to refrain from securities lending could benefit the affiliated insurance companies (which would receive the DRD) to the detriment of contract holders who have selected that fund (as they would not receive the benefit of securities lending income, including substitute payments). However, the Advisor and the affiliated subadvisors have a fiduciary duty to independently assess whether engaging in securities lending is in the best interests of a fund, which should act to limit this conflict of interest.
As with other extensions of credit, there are risks that collateral could be inadequate in the event of the borrower failing financially, which could result in actual financial loss, and risks that recovery of loaned securities could be delayed, which could result in interference with portfolio management decisions or exercise of ownership rights. The collateral is managed by an affiliate of the Advisor, which may incentivize the Advisor to lend fund securities to benefit this affiliate. The Advisor maintains robust oversight of securities lending activity and seeks to ensure that all lending activity undertaken by a fund is in the fund’s best interests. A fund will be responsible for the risks associated with the investment of cash collateral, including the risk that the fund may lose money on the investment or may fail to earn sufficient income to meet its obligations to the borrower. In addition,  a fund may lose its right to vote its shares of the loaned securities at a shareholder meeting if the subadvisor does not recall or does not timely recall the loaned securities, or if the borrower fails to return the recalled securities in advance of the record date for the meeting.
The Trust, on behalf of certain of its funds, has entered into an agency agreement for securities lending transactions (each, a “Securities Lending Agreement”) with each of Citibank, Brown Brothers Harriman, Fidelity and Goldman Sachs (each, a “Securities Lending Agent”). Pursuant to each Securities Lending Agreement, Citibank, Brown Brothers Harriman, Fidelity or Goldman Sachs acts as securities lending agent for the funds and administers each fund’s securities lending program. During the fiscal year, each Securities Lending Agent performed various services for the funds, including the following: (i) lending portfolio securities, previously identified by the fund as available for loan, and held by the fund’s custodian (“Custodian”) on behalf of the fund, to borrowers identified by the fund in the Securities Lending Agreement; (ii) instructing the Custodian to receive and deliver securities, as applicable, to effect such loans; (iii) locating borrowers; (iv) monitoring daily the market value of loaned securities; (v) ensuring daily movement of collateral associated with loan transactions; (vi) marking to market loaned securities and non-cash collateral; (vii) monitoring dividend activity with respect to loaned securities; (viii) negotiating loan terms with the borrowers; (ix) recordkeeping and account servicing related to securities lending activities; and (x) arranging for the return of loaned securities at the termination of the loan. Under each Securities Lending Agreement, Citibank, Brown Brothers Harriman, Fidelity or Goldman Sachs, as applicable, generally will bear the risk that a borrower may default on its obligation to return loaned securities.
Securities lending involves counterparty risk, including the risk that the loaned securities may not be returned or returned in a timely manner and/or a loss of rights in the collateral if the borrower or the lending agent defaults or fails financially. This risk is increased when the fund’s loans are concentrated with a single or limited number of borrowers. There are no limits on the number of borrowers to which the fund may lend securities and the fund may lend securities to only one or a small group of borrowers. In addition, under each Securities Lending Agreement, loans may be made to affiliates of Citibank, Brown Brothers Harriman, Fidelity or Goldman Sachs, as applicable, as identified in the applicable Securities Lending Agreement.
Cash collateral may be invested by a fund in JHCT, a privately offered 1940 Act registered institutional money market fund. Investment of cash collateral offers the opportunity for a fund to profit from income earned by this collateral pool, but also the risk of loss, should the value of the fund’s shares in the collateral pool decrease below  the NAV at which such shares were purchased.
For each fund that engaged in securities lending activities during the fiscal period ended August 31, 2022, the following tables detail the amounts of income and fees/compensation related to such activities during the period. Any fund not listed below did not engage in securities lending activities during the fiscal period ended August 31, 2022.
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Fund Name
Alternative Asset Allocation Fund
Blue Chip Growth Fund
Capital Appreciation Value Fund
Capital Appreciation Fund
Core Bond Fund
Gross Income from securities lending activities ($)
184,473
177,054
52,763
234
1,023
Fees and/or compensation for securities lending activities and related services
 
 
 
 
Fees paid to securities lending agent from a revenue split ($)
19,074
18,741
5,719
13
114
Fees paid for any cash collateral management service (including fees deducted from a pooled cash collateral reinvestment vehicle) that are not included in the revenue split ($)
11,400
7,406
1,465
14
107
Administrative fees not included in revenue split*
-
-
-
-
-
Indemnification fee not included in revenue split
-
-
-
-
-
Rebate (paid to borrower) ($)
20,436
19,278
5,520
115
-
Other fees not included in revenue split (specify)
-
-
-
-
-
Aggregate fees/compensation for securities lending activities ($)
50,910
45,425
12,704
142
221
Net Income from securities lending activities ($)
133,563
131,629
40,059
92
802
Fund Name
Equity Income Fund
Emerging Markets Fund
Emerging Markets Debt Fund
Floating Rate Income Fund
High Yield Fund
Gross Income from securities lending activities ($)
54,809
74,347
424,709
139,438
48,547
Fees and/or compensation for securities lending activities and related services
 
 
 
 
Fees paid to securities lending agent from a revenue split ($)
5,469
10,554
35,392
15,953
5,625
Fees paid for any cash collateral management service (including fees deducted from a pooled cash collateral reinvestment vehicle) that are not included in the revenue split ($)
7,100
955
24,789
8,949
2,657
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Fund Name
Equity Income Fund
Emerging Markets Fund
Emerging Markets Debt Fund
Floating Rate Income Fund
High Yield Fund
Administrative fees not included in revenue split*
-
-
-
-
-
Indemnification fee not included in revenue split
-
-
-
-
-
Rebate (paid to borrower) ($)
4,049
1,653
40,885
2,716
862
Other fees not included in revenue split (specify)
-
-
-
-
-
Aggregate fees/compensation for securities lending activities ($)
16,618
13,162
101,066
27,618
9,144
Net Income from securities lending activities ($)
38,191
61,185
323,643
111,820
39,403
Fund Name
International Small Company Fund
International Strategic Equity Allocation Fund
Mid Value Fund
Gross Income from securities lending activities ($)
666,205
1,200,728
210,347
Fees and/or compensation for securities lending activities and related services
 
 
Fees paid to securities lending agent from a revenue split ($)
78,527
89,463
21,812
Fees paid for any cash collateral management service (including fees deducted from a pooled cash collateral reinvestment vehicle) that are not included in the revenue split ($)
14,687
43,065
6,990
Administrative fees not included in revenue split*
-
-
-
Indemnification fee not included in revenue split
-
-
-
Rebate (paid to borrower) ($)
21,089
259,937
28,965
Other fees not included in revenue split (specify)
-
-
-
Aggregate fees/compensation for securities lending activities ($)
114,303
392,465
57,767
Net Income from securities lending activities ($)
551,902
808,263
152,580
Fund Name
Multi-Asset High Income Fund
2010 Lifetime Blend Portfolio
2015 Lifetime Blend Portfolio
2020 Lifetime Blend Portfolio
Gross Income from securities lending activities ($)
8,806
98,485
119,702
389,032
Fees and/or compensation for securities lending activities and related services
 
 
 
Fees paid to securities lending agent from a revenue split ($)
1,041
10,946
12,800
40,748
Fees paid for any cash collateral management service (including fees deducted from a pooled cash collateral reinvestment vehicle) that are not included in the revenue split ($)
121
5,506
6,515
23,209
Administrative fees not included in revenue split*
-
-
-
-
Indemnification fee not included in revenue split
-
-
-
-
Rebate (paid to borrower) ($)
356
5,343
10,743
39,617
Other fees not included in revenue split (specify)
-
-
-
-
Aggregate fees/compensation for securities lending activities ($)
1,518
21,795
30,058
103,574
Net Income from securities lending activities ($)
7,288
76,690
89,644
285,458
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Fund Name
2025 Lifetime Blend Portfolio
2025 Preservation Blend Portfolio
2030 Lifetime Blend Portfolio
2030 Preservation Blend Portfolio
2035 Lifetime Blend Portfolio
Gross Income from securities lending activities ($)
548,699
818,481
488,187
875,009
165,572
Fees and/or compensation for securities lending activities and related services
 
 
 
 
Fees paid to securities lending agent from a revenue split ($)
58,803
70,706
51,268
92,191
16,003
Fees paid for any cash collateral management service (including fees deducted from a pooled cash collateral reinvestment vehicle) that are not included in the revenue split ($)
32,421
34,493
29,828
57,973
15,755
Administrative fees not included in revenue split*
-
-
-
-
-
Indemnification fee not included in revenue split
-
-
-
-
-
Rebate (paid to borrower) ($)
45,086
61,446
47,731
78,742
21,419
Other fees not included in revenue split (specify)
-
-
-
-
-
Aggregate fees/compensation for securities lending activities ($)
136,310
166,645
128,827
228,906
53,177
Net Income from securities lending activities ($)
412,389
651,836
359,360
646,103
112,395
Fund Name
2035 Preservation Blend Portfolio
2040 Lifetime Blend Portfolio
2040 Preservation Blend Portfolio
2045 Lifetime Blend Portfolio
2045 Preservation Blend Portfolio
Gross Income from securities lending activities ($)
193,266
88,029
176,865
42,387
64,768
Fees and/or compensation for securities lending activities and related services
 
 
 
 
Fees paid to securities lending agent from a revenue split ($)
19,990
9,024
18,610
4,252
6,941
Fees paid for any cash collateral management service (including fees deducted from a pooled cash collateral reinvestment vehicle) that are not included in the revenue split ($)
19,695
8,731
14,005
4,958
6,812
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Fund Name
2035 Preservation Blend Portfolio
2040 Lifetime Blend Portfolio
2040 Preservation Blend Portfolio
2045 Lifetime Blend Portfolio
2045 Preservation Blend Portfolio
Administrative fees not included in revenue split*
-
-
-
-
-
Indemnification fee not included in revenue split
-
-
-
-
-
Rebate (paid to borrower) ($)
13,015
6,881
13,748
3,629
2,771
Other fees not included in revenue split (specify)
-
-
-
-
-
Aggregate fees/compensation for securities lending activities ($)
52,700
24,636
46,363
12,839
16,524
Net Income from securities lending activities ($)
140,566
63,393
130,502
29,548
48,244
Fund Name
2050 Lifetime Blend Portfolio
2050 Preservation Blend Portfolio
2055 Lifetime Blend Portfolio
2055 Preservation Blend Portfolio
Gross Income from securities lending activities ($)
32,325
49,415
16,755
10,096
Fees and/or compensation for securities lending activities and related services
 
 
 
Fees paid to securities lending agent from a revenue split ($)
3,168
5,051
1,707
995
Fees paid for any cash collateral management service (including fees deducted from a pooled cash collateral reinvestment vehicle) that are not included in the revenue split ($)
5,147
4,988
2,331
1,995
Administrative fees not included in revenue split*
-
-
-
-
Indemnification fee not included in revenue split
-
-
-
-
Rebate (paid to borrower) ($)
1,841
3,483
558
-
Other fees not included in revenue split (specify)
-
-
-
-
Aggregate fees/compensation for securities lending activities ($)
10,156
13,522
4,596
2,990
Net Income from securities lending activities ($)
22,169
35,893
12,159
7,106
Fund Name
2060 Lifetime Blend Portfolio
2060 Preservation Blend Portfolio
2065 Lifetime Blend Portfolio
2065 Preservation Blend Portfolio
Gross Income from securities lending activities ($)
10,342
6,349
164
10
Fees and/or compensation for securities lending activities and related services
 
 
 
Fees paid to securities lending agent from a revenue split ($)
1,109
768
19
1
Fees paid for any cash collateral management service (including fees deducted from a pooled cash collateral reinvestment vehicle) that are not included in the revenue split ($)
885
190
10
1
Administrative fees not included in revenue split*
-
-
-
-
Indemnification fee not included in revenue split
-
-
-
-
Rebate (paid to borrower) ($)
455
-
1
2
Other fees not included in revenue split (specify)
-
-
-
-
Aggregate fees/compensation for securities lending activities ($)
2,449
958
30
4
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Fund Name
2060 Lifetime Blend Portfolio
2060 Preservation Blend Portfolio
2065 Lifetime Blend Portfolio
2065 Preservation Blend Portfolio
Net Income from securities lending activities ($)
7,893
5,391
134
6
Fund Name
Lifestyle Blend Aggressive Portfolio
Lifestyle Blend Balanced Portfolio
Lifestyle Blend Conservative Portfolio
Lifestyle Blend Growth Portfolio
Gross Income from securities lending activities ($)
44,898
1,582,525
654,709
777,133
Fees and/or compensation for securities lending activities and related services
 
 
 
Fees paid to securities lending agent from a revenue split ($)
4,448
178,626
73,734
88,386
Fees paid for any cash collateral management service (including fees deducted from a pooled cash collateral reinvestment vehicle) that are not included in the revenue split ($)
4,741
82,916
33,694
47,188
Administrative fees not included in revenue split*
-
-
-
-
Indemnification fee not included in revenue split
-
-
-
-
Rebate (paid to borrower) ($)
4,359
69,478
30,350
21,892
Other fees not included in revenue split (specify)
-
-
-
-
Aggregate fees/compensation for securities lending activities ($)
13,548
331,020
137,778
157,466
Net Income from securities lending activities ($)
31,350
1,251,505
516,931
619,667
Fund Name
Lifestyle Blend Moderate Portfolio
Income Preservation Blend Portfolio
Opportunistic Fixed Income Fund
Real Estate Securities Fund
Science & Technology Fund
Gross Income from securities lending activities ($)
654,837
871,531
652
67
34,708
Fees and/or compensation for securities lending activities and related services
 
 
 
 
Fees paid to securities lending agent from a revenue split ($)
73,154
98,532
64
5
4,046
Fees paid for any cash collateral management service (including fees deducted from a pooled cash collateral reinvestment vehicle) that are not included in the revenue split ($)
35,828
56,728
121
15
1,311
Administrative fees not included in revenue split*
-
-
-
-
-
Indemnification fee not included in revenue split
-
-
-
-
-
Rebate (paid to borrower) ($)
33,272
25,682
-
2
968
Other fees not included in revenue split (specify)
-
-