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 fiscal year ended
October 31, 2022, the Fund’s portfolio turnover rate was 95% of the average value of its
portfolio.
PRINCIPAL
INVESTMENT STRATEGY. Under normal
circumstances, the Fund invests primarily in a diversified portfolio of common
stocks covering a broad range of industries, companies and market
capitalizations that the sub-adviser, Wellington Management Company LLP
(“Wellington Management”), believes exhibit long-term growth potential. The Fund
may invest in securities of companies of any market capitalization, but tends to
focus on mid to large capitalization stocks. The Fund may invest up to 25% of
its net assets in foreign issuers and non-dollar securities. The Fund may trade
securities actively. Wellington Management uses fundamental analysis to identify
companies with accelerating operating characteristics for purchase. Based on
market or economic conditions, the Fund may, through its normal bottom-up stock
selection process, focus in one or more sectors of the
market.
PRINCIPAL
RISKS. The principal
risks of investing in the Fund are described below. When you sell
your shares they may be worth more
or less than what you paid for them, which means that you could lose money as a
result of your investment. An
investment in the Fund is not a bank deposit and is not insured or guaranteed by
the Federal Deposit Insurance Corporation or any other government
agency. As with any
fund, there is no guarantee that the Fund will achieve its investment
objective.
Market
Risk –
Market risk
is the risk that one or more markets in which the Fund invests will go down in
value, including the possibility that the markets will go down sharply and
unpredictably. Securities of a company may decline in value due to its financial
prospects and activities, including certain operational impacts, such as data
breaches and cybersecurity attacks. Securities may also decline in value due to
general market and economic movements and trends, including adverse changes to
credit markets, or as a result of other events such as geopolitical events,
natural disasters, or widespread pandemics (such as COVID-19) or other adverse
public health developments.
Equity
Risk –
The risk that
the price of equity or equity related securities may decline due to changes in a
company’s financial condition and overall market and economic
conditions.
Large
Cap Securities Risk –
The
securities of large market capitalization companies may underperform other
segments of the market because such companies may be less responsive to
competitive challenges and opportunities and may be unable to attain high growth
rates during periods of economic expansion.
Mid-Cap
Securities Risk –
The
securities of mid-capitalization companies generally trade in lower volumes and
are generally subject to greater and less predictable price changes than the
securities of larger capitalization companies.
Growth
Investing Style Risk –
If the
sub-adviser incorrectly assesses a company’s prospects for growth or how other
investors will value the company’s growth, then the price of the company’s stock
may decrease, or may not increase to the level anticipated by the sub-adviser.
In addition, growth stocks may be more volatile than other stocks because they
are more sensitive to investors’ perceptions of the issuing company’s growth
potential. Also, the growth investing style may over time go in and out of
favor. At times when the investing style used by the Fund is out of favor, the
Fund may underperform other equity funds that use different investing
styles.
Sector
Risk –
To the extent
the Fund invests more heavily in a particular sector or sectors, its performance
will be especially sensitive to developments that significantly affect those
sectors. Individual sectors may be more volatile, and may perform differently,
from the broader market.
Foreign
Investments Risk –
Investments in
foreign securities may be riskier, more volatile, and less liquid than
investments in U.S. securities. Differences between the U.S. and foreign
regulatory regimes and securities markets, including the less stringent investor
protection, less stringent accounting, corporate governance, financial reporting
and disclosure standards of some foreign markets, as well as political and
economic developments in foreign countries and regions and the U.S. (including
the imposition of sanctions, tariffs, or other governmental restrictions), may
affect the value of the Fund’s investments in foreign securities. Changes in
currency exchange rates may also adversely affect the Fund’s foreign
investments.
