Fundamental. Thinking. Worldwide. Beginning on January 1,
2021, as permitted by regulations adopted by the Securities and Exchange
Commission, paper copies of the Fund’s shareholder reports will no longer be
sent by mail, unless you specifically request paper copies of the reports from
the Fund or from your financial intermediary, such as a broker-dealer or bank.
Instead, the reports will be made available on a website, and you will be
notified by mail each time a report is posted and provided with a website link
to access the report. If you already elected to receive shareholder reports
electronically, you will not be affected by this change and you need not take
any action. You may elect to receive shareholder reports and other
communications from the Fund electronically by contacting your financial
intermediary. You may elect to receive all future reports in paper free of
charge. You can inform the Fund that you wish to continue receiving paper copies
of your shareholder reports by calling (877) 435-8105 or by sending an email request to
[email protected]. If your account is held through a financial
intermediary, you can contact your financial intermediary to make your election.
Your election to receive reports in paper will apply to all Funds held with the
Fund complex/your financial intermediary. The SAI and the Fund’s annual and
semi-annual reports are also available free of charge on Harding Loevner’s
website at hardingloevnerfunds.com. Reports and other information about the Fund
are also available on the EDGAR database on the Commission’s Internet site at
SEC.gov or by electronic request at the following e-mail address: [email protected]. A
duplication fee will be applied to written requests and needs to be paid at the
time your request is submitted. As with all mutual funds, the Securities and
Exchange Commission has not approved or disapproved these securities or
determined if this prospectus is truthful or complete. Any representation to the
contrary is a criminal offense. Prospectus February 28, 2020 Mutual Funds
for Individual Investors Global Equity Portfolio HLMGX: Advisor
Class International Equity Portfolio HLMNX: Investor
Class International Small Companies Portfolio HLMSX: Investor
Class Emerging Markets Portfolio HLEMX: Advisor Class Frontier
Emerging Markets Portfolio HLMOX: Investor Class
|
|
|
|
|
PORTFOLIO
SUMMARY |
|
GLOBAL EQUITY PORTFOLIO
|
INVESTMENT OBJECTIVE
The Global Equity Portfolio (the
“Portfolio”) seeks long-term capital appreciation through investments in equity
securities of companies based both inside and outside the United States.
PORTFOLIO FEES AND EXPENSES
This table describes the fees and
expenses that you may pay if you buy and hold shares of the Advisor
Class of the Portfolio. The table does not take into account brokerage
commissions that you may pay on your purchases and sales of Advisor Class shares
of the Portfolio.
|
|
|
|
|
|
SHAREHOLDER
FEES
(fees paid directly from
your investment) |
|
|
|
Maximum Sales
Charge (Load) Imposed on Purchases (as a percentage of offering
price) |
|
|
None |
|
|
|
Redemption Fee (as
a percentage of amount redeemed within 90 days or less from the date of
purchase) |
|
|
None |
|
|
ANNUAL PORTFOLIO OPERATING
EXPENSES
(expenses that you pay
each year as a percentage of the value of your
investment) |
|
|
|
Management
Fees |
|
|
0.80% |
|
|
|
Distribution
(12b-1) Fees |
|
|
None |
|
|
|
Other Expenses |
|
|
0.32% |
|
Total Annual Portfolio Operating
Expenses |
|
|
1.12% |
|
Fee Waiver and/or Expense
Reimbursement1 |
|
|
0.00% |
|
|
|
Total Annual
Portfolio Operating Expenses After Fee Waiver and/or Expense
Reimbursement1 |
|
|
1.12% |
|
|
1Harding
Loevner LP has contractually agreed to waive a portion of its management
fee and/or reimburse the Advisor Class of the Portfolio for its other
operating expenses to the extent Total Annual Portfolio Operating Expenses
(excluding dividend expenses, borrowing costs, interest expense relating
to short sales, interest, taxes, brokerage commissions and extraordinary
expenses), as a percentage of average daily net assets, exceed 1.25%
through February 28, 2021. This fee waiver and expense reimbursement
agreement may be terminated by the Board at any time and will
automatically terminate upon the termination of the Investment Advisory
Agreement. |
|
Example:
This example is intended to help you compare the cost of investing in the
Advisor Class of the Portfolio with the cost of investing in other mutual
funds. The example assumes that you invest $10,000 in the Advisor Class of
the Portfolio for the time periods indicated and then redeem all of your shares
at the end of those periods. The example also assumes that your investment has a
5% return each year and that the Advisor Class’s operating expenses remain the
same. The example does not take into account brokerage commissions that you may
pay on your purchases and sales of Advisor Class shares of the Portfolio.
Although your actual costs may be higher or lower, based on these assumptions
your costs would be:
|
|
|
|
|
|
|
|
|
|
|
1 YEAR |
|
3 YEARS |
|
5 YEARS |
|
10 YEARS |
|
|
|
|
$114 |
|
$356 |
|
$617 |
|
$1,363 |
PORTFOLIO TURNOVER
The Portfolio 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 Portfolio shares are held in a taxable
account. These costs, which are not reflected in annual portfolio operating
expenses or in the example, affect the Portfolio’s performance. During the most
recent fiscal year, the Portfolio’s portfolio turnover rate was 39% of the
average value of its portfolio.
PRINCIPAL INVESTMENT STRATEGIES
The Portfolio invests in companies
based in the United States and other developed markets, as well as in
emerging and frontier markets. Harding Loevner LP (“Harding Loevner”), the
Portfolio’s investment adviser, undertakes fundamental research in an effort to
identify companies that are well managed, financially sound, fast growing, and
strongly competitive, and whose shares are reasonably priced relative to
estimates of their value. To reduce its volatility, the Portfolio is diversified
across dimensions of geography, industry, currency, and market capitalization.
The Portfolio normally holds investments across at least 15 countries.
The Portfolio will normally invest
broadly in equity securities of companies domiciled in the following countries
and regions: (1) Europe; (2) the Pacific Rim; (3) the United
States, Canada, and Mexico; and (4) countries with emerging or frontier
markets. At least 65% of the Portfolio’s total assets will be denominated in at
least three currencies, which may include the U.S. dollar. For purposes of
compliance with this restriction, American Depositary Receipts, Global
Depositary Receipts, and European Depositary Receipts, (collectively,
“Depositary Receipts”), will be considered to be denominated in the currency of
the country where the securities underlying the Depositary Receipts are
principally traded.
The Portfolio invests, under normal
circumstances, at least 80% of its net assets (plus any borrowings for
investment purposes) in common stocks, preferred stocks, rights, and warrants
issued by companies that are based both inside and outside the United States,
securities convertible into such securities (including Depositary Receipts), and
investment companies that invest in the types of securities in which the
Portfolio would normally invest.
Because some emerging market
countries do not permit foreigners to participate directly in their securities
markets or otherwise present difficulties for efficient foreign investment, the
Portfolio may use equity derivative securities, and, in particular,
participation notes, to gain exposure to those countries.
PRINCIPAL RISKS
The Portfolio is subject to numerous
risks, any of which could cause an investor to lose money. The principal risks
of the Portfolio are as follows:
Market
Risk: Investments in the Portfolio may lose value due to a general
downturn in stock markets.
Currency
Risk: Foreign
currencies may experience steady or sudden devaluation relative to the U.S.
dollar, adversely affecting the value of the Portfolio’s investments. Because
the Portfolio’s net asset value is determined on the basis of U.S. dollars, if
the local currency of a foreign market depreciates against the U.S. dollar, you
may lose money even if the foreign market prices of the Portfolio’s holdings
rise.
Foreign Investment
Risk: Securities issued by foreign entities involve risks not associated
with U.S. investments. These risks include additional taxation, political,
economic, social or diplomatic instability, and the above-mentioned possibility
of changes in foreign currency exchange rates. There may also be less
publicly-available information about a foreign issuer. Such risks may be
magnified with respect to securities of issuers in frontier emerging markets.
Emerging and
Frontier Market Risk: Emerging and frontier market securities involve certain risks, such
as exposure to economies less diverse and mature than that of the United States
or more established foreign markets. Economic or political instability may cause
larger price changes in emerging or frontier market securities than in
securities of issuers based in more developed foreign countries.
Participation Notes
Risk: Participation notes are issued by banks, or broker-dealers, or
their affiliates and are designed to replicate the return of a particular
underlying equity or debt security, currency, or market. When the participation
note matures, the issuer of the participation note will pay to, or receive from,
the Portfolio the difference between the nominal value of the underlying
instrument at the time of purchase and that instrument’s value at maturity.
Participation notes involve the same risks associated with a direct investment
in the underlying security, currency, or market. In addition, participation
notes involve counterparty risk, because the Portfolio has no rights under
participation notes against the issuer(s) of the underlying security(ies) and
must rely on the creditworthiness of the issuer of the participation note.
NAV
Risk: The net
asset value of the Portfolio and the value of your investment will fluctuate.
PORTFOLIO PERFORMANCE
The following bar chart shows how
the investment results of the Portfolio’s Advisor Class shares have varied from
year to year. The table that follows shows how the average annual total returns
of the Portfolio’s Advisor Class shares compare with a broad measure of market
performance. Together, these provide an indication of
the risks of investing in the
Portfolio. How the Advisor Class shares of the Portfolio have performed in the
past (before and after taxes) is not necessarily an indication of how they will
perform in the future.
Updated Portfolio performance
information is available at www.hardingloevnerfunds.com or by calling
(877) 435-8105.
The best calendar quarter return
during the period shown above was 15.79% in the first quarter of 2012; the worst
was -16.27% in the third quarter of 2011.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVERAGE ANNUAL TOTAL
RETURNS
(for the periods ended
December 31, 2019) |
|
|
|
1-YEAR |
|
|
5-YEAR |
|
|
10-YEAR |
|
|
GLOBAL
EQUITY PORTFOLIO - ADVISOR CLASS |
|
|
|
|
|
Return
Before Taxes |
|
|
28.77% |
|
|
|
10.19% |
|
|
|
9.77% |
|
|
|
|
|
Return
After Taxes on Distributions1 |
|
|
28.69% |
|
|
|
8.72% |
|
|
|
8.87% |
|
|
|
|
|
Return
After Taxes on Distributions and Sale of Portfolio Shares1 |
|
|
17.09% |
|
|
|
7.84% |
|
|
|
7.88% |
|
|
|
|
|
MSCI ALL
COUNTRY WORLD (NET) INDEX (reflects no deduction for fees,
expenses, or U.S. taxes) |
|
|
26.60% |
|
|
|
8.41% |
|
|
|
8.79% |
|
|
1After-tax
returns in the table above are calculated using the historical highest
individual federal marginal income tax rates and do not reflect the impact
of state and local taxes. Actual after-tax returns depend on an investor’s
tax situation and may differ from those shown, and after-tax returns shown
are not relevant to investors who hold their Portfolio shares through
tax-deferred arrangements, such as 401(k) plans or Individual Retirement
Accounts. |
|
MANAGEMENT
Investment Adviser
Harding Loevner serves as investment
adviser to the Portfolio.
Portfolio Managers
Peter Baughan, Ferrill Roll, Scott
Crawshaw, Jingyi Li, Christopher Mack, and Richard Schmidt serve as the
portfolio managers of the Global Equity Portfolio. Mr. Baughan has held his
position since February 2003, Mr. Roll has held his position since
January 2001, Mr. Crawshaw has held his position since January 2018,
Mr. Li has held his position since February 2019, Mr. Mack has held
his position since June 2014 and Mr. Schmidt has held his position since
February 2015. Messrs. Baughan and Roll are the co-lead portfolio managers.
PURCHASE AND SALE OF PORTFOLIO SHARES
The minimum initial investment in
the Advisor Class of the Portfolio is $5,000. Additional purchases may be
for any amount. You may purchase, redeem (sell) or exchange shares of the
Portfolio on any business day through certain authorized brokers and other
financial intermediaries or directly from the Portfolio by mail, telephone, or
wire.
TAX CONSIDERATIONS
The Portfolio’s distributions are
generally taxable to you as ordinary income, capital gains, or a combination of
the two, unless you are investing through a tax-deferred arrangement, such as a
401(k) plan or an individual retirement account. Upon withdrawal, your
investment through a tax-deferred arrangement may become taxable.
PAYMENTS TO BROKERS-DEALERS AND OTHER FINANCIAL
INTERMEDIARIES
If you purchase Portfolio shares
through a broker-dealer or other financial intermediary (such as a bank), the
Portfolio and its related companies may pay the intermediary for the sale of
Portfolio shares and related services. These payments may create a conflict of
interest by influencing the broker-dealer or other intermediary and your
salesperson to recommend the Portfolio over another investment. Ask your
salesperson or visit your financial intermediary’s website for more information.
|
|
|
|
|
PORTFOLIO
SUMMARY |
|
INTERNATIONAL EQUITY PORTFOLIO
|
INVESTMENT OBJECTIVE
The International Equity Portfolio
(the “Portfolio”) seeks long-term capital appreciation through investments in
equity securities of companies based outside the United States.
PORTFOLIO FEES AND EXPENSES
This table describes the fees and
expenses that you may pay if you buy and hold shares of the Investor
Class of the Portfolio.
|
|
|
|
|
|
SHAREHOLDER
FEES
(fees paid directly from
your investment) |
|
|
|
Maximum Sales
Charge (Load) Imposed on Purchases (as a percentage of offering
price) |
|
|
None |
|
|
|
Redemption Fee (as
a percentage of amount redeemed within 90 days or less from the date of
purchase) |
|
|
None |
|
|
ANNUAL PORTFOLIO OPERATING
EXPENSES
(expenses that you pay
each year as a percentage of the value of your
investment) |
|
|
|
Management
Fees |
|
|
0.67% |
|
|
|
Distribution
(12b-1) Fees |
|
|
0.25% |
|
|
|
Other Expenses |
|
|
0.21% |
|
Total Annual Portfolio Operating
Expenses |
|
|
1.13% |
|
Fee Waiver and/or Expense
Reimbursement1 |
|
|
0.00% |
|
|
|
Total Annual
Portfolio Operating Expenses After Fee Waiver and/or Expense
Reimbursement1 |
|
|
1.13% |
|
|
1Harding
Loevner LP has contractually agreed to waive a portion of its management
fee and/or reimburse the Investor Class of the Portfolio for its
other operating expenses to the extent Total Annual Portfolio Operating
Expenses (excluding dividend expenses, borrowing costs, interest expense
relating to short sales, interest, taxes, brokerage commissions and
extraordinary expenses), as a percentage of average daily net assets,
exceed 1.25% through February 28, 2021. This fee waiver and expense
reimbursement agreement may be terminated by the Board at any time and
will automatically terminate upon the termination of the Investment
Advisory Agreement. |
|
Example:
This example is intended to help you compare the cost of investing in the
Investor Class of the Portfolio with the cost of investing in other mutual
funds. The example assumes that you invest $10,000 in the Investor Class of
the Portfolio for the time periods indicated and then redeem all of your shares
at the end of those periods. The example also assumes that your investment has a
5% return each year and that the Investor Class’s operating expenses remain the
same. Although your actual costs may be higher or lower, based on these
assumptions your costs would be:
|
|
|
|
|
|
|
|
|
|
|
1 YEAR |
|
3 YEARS |
|
5 YEARS |
|
10 YEARS |
|
|
|
|
$115 |
|
$359 |
|
$622 |
|
$1,375 |
PORTFOLIO TURNOVER
The Portfolio 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 Portfolio shares are held in a taxable
account. These costs, which are not reflected in annual portfolio operating
expenses or in the example, affect the Portfolio’s performance. During the most
recent fiscal year, the Portfolio’s portfolio turnover rate was 30% of the
average value of its portfolio.
PRINCIPAL INVESTMENT STRATEGIES
The Portfolio invests primarily in
companies based in developed markets outside the United States as well as in
companies in emerging and frontier markets. Harding Loevner LP (“Harding
Loevner”), the Portfolio’s investment adviser, undertakes fundamental research
in an effort to identify companies that are well managed, financially sound,
fast growing, and strongly competitive, and whose shares are reasonably priced
relative to estimates of their value. To reduce its volatility, the Portfolio is
diversified across dimensions of geography, industry, currency, and market
capitalization. The Portfolio normally holds investments across at least
15 countries.
Factors bearing on whether a company
is considered to be “based” outside the United States may include: (1) it
is legally domiciled outside the United States; (2) it conducts at least
50% of its business, as measured by the location of its sales, earnings, assets,
or production, outside the United States; or (3) it has the principal
exchange listing for its securities outside the United States.
The Portfolio will normally invest
broadly in equity securities of companies domiciled in the following countries
and regions: (1) Europe; (2) the Pacific Rim; (3) Canada and
Mexico; and (4) countries with emerging or frontier markets. At least 65%
of the Portfolio’s total assets will be denominated in at least three currencies
other than the U.S. dollar. For purposes of compliance with this restriction,
American Depositary Receipts, Global Depositary Receipts, and European
Depositary Receipts (collectively, “Depositary Receipts”), will be considered to
be denominated in the currency of the country where the securities underlying
the Depositary Receipts are principally traded.
The Portfolio invests, under normal
circumstances, at least 80% of its net assets (plus any borrowings for
investment purposes) in common stocks, preferred stocks, rights, and warrants
issued by companies that are based outside the United States, securities
convertible into such securities (including Depositary Receipts), and
investment companies that invest in
the types of securities in which the Portfolio would normally invest. The
Portfolio also may invest in securities of U.S. companies that derive, or are
expected to derive, a significant portion of their revenues from their foreign
operations, although under normal circumstances not more than 15% of the
Portfolio’s total assets will be invested in securities of U.S. companies.
Because some emerging market
countries do not permit foreigners to participate directly in their securities
markets or otherwise present difficulties for efficient foreign investment, the
Portfolio may use equity derivative securities, and, in particular,
participation notes, to gain exposure to those countries.
PRINCIPAL RISKS
The Portfolio is subject to numerous
risks, any of which could cause an investor to lose money. The principal risks
of the Portfolio are as follows:
Market
Risk: Investments
in the Portfolio may lose value due to a general downturn in stock markets.
Currency
Risk: Foreign
currencies may experience steady or sudden devaluation relative to the U.S.
dollar, adversely affecting the value of the Portfolio’s investments. Because
the Portfolio’s net asset value is determined on the basis of U.S. dollars, if
the local currency of a foreign market depreciates against the U.S. dollar, you
may lose money even if the foreign market prices of the Portfolio’s holdings
rise.
Foreign Investment
Risk: Securities issued by foreign entities involve risks not associated
with U.S. investments. These risks include additional taxation, political,
economic, social or diplomatic instability, and the above-mentioned possibility
of changes in foreign currency exchange rates. There may also be less
publicly-available information about a foreign issuer. Such risks may be
magnified with respect to securities of issuers in frontier emerging markets.
Emerging and
Frontier Market Risk: Emerging and frontier market securities involve certain risks, such
as exposure to economies less diverse and mature than that of the United States
or more established foreign markets. Economic or political instability may cause
larger price changes in emerging or frontier market securities than in
securities of issuers based in more developed foreign countries.
Participation Notes
Risk: Participation notes are issued by banks, or broker-dealers, or
their affiliates and are designed to replicate the return of a particular
underlying equity or debt security, currency, or market. When the participation
note matures, the issuer of the participation note will pay to, or receive from,
the Portfolio the difference between the nominal value of the underlying
instrument at the time of purchase and that instrument’s value at maturity.
Participation notes involve the same risks associated with a direct investment
in the underlying security, currency, or market. In addition, participation
notes involve
counterparty risk, because the
Portfolio has no rights under participation notes against the issuer(s) of the
underlying security(ies) and must rely on the creditworthiness of the issuer of
the participation note.
NAV
Risk: The net
asset value of the Portfolio and the value of your investment will
fluctuate.
PORTFOLIO PERFORMANCE
The following bar chart shows how
the investment results of the Portfolio’s Investor Class shares have varied from
year to year. The table that follows shows how the average annual total returns
of the Portfolio’s Investor Class shares compare with a broad measure of market
performance. Together, these provide an indication of the risks of investing in
the Portfolio. How the Investor Class shares of the Portfolio have
performed in the past (before and after taxes) is not necessarily an indication
of how they will perform in the future.
Updated Portfolio performance
information is available at www.hardingloevnerfunds.com or by calling
(877) 435-8105.
|
|
INTERNATIONAL EQUITY PORTFOLIO |
The best calendar quarter return
during the period shown above was 16.25% in the third quarter of 2010; the worst
was -19.67% in the third quarter of 2011.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVERAGE ANNUAL TOTAL
RETURNS
(for the periods ended
December 31, 2019) |
|
|
|
1-YEAR |
|
|
5-YEAR |
|
|
10-YEAR |
|
|
INTERNATIONAL EQUITY PORTFOLIO - INVESTOR CLASS |
|
|
|
|
|
Return
Before Taxes |
|
|
24.81% |
|
|
|
7.35% |
|
|
|
7.22% |
|
|
|
|
|
Return
After Taxes on Distributions1 |
|
|
24.57% |
|
|
|
7.19% |
|
|
|
7.11% |
|
|
|
|
|
Return
After Taxes on Distributions and Sale of Portfolio Shares1 |
|
|
15.08% |
|
|
|
5.84% |
|
|
|
5.91% |
|
|
|
|
|
MSCI ALL COUNTRY
WORLD ex-U.S. (NET)
INDEX (reflects no deduction for fees, expenses, or U.S.
taxes) |
|
|
21.51% |
|
|
|
5.51% |
|
|
|
4.97% |
|
|
1After-tax
returns in the table above are calculated using the historical highest
individual federal marginal income tax rates and do not reflect the impact
of state and local taxes. Actual after-tax returns depend on an investor’s
tax situation and may differ from those shown, and after-tax returns shown
are not relevant to investors who hold their Portfolio shares through
tax-deferred arrangements, such as 401(k) plans or Individual Retirement
Accounts. |
|
MANAGEMENT
Investment Adviser
Harding Loevner serves as investment
adviser to the Portfolio.
Portfolio Managers
Ferrill Roll, Andrew West, Bryan
Lloyd and Patrick Todd serve as the portfolio managers of the International
Equity Portfolio. Mr. Roll has held his position since October 2004,
Mr. West has held his position since June 2014, Mr. Lloyd has held his
position since June 2014 and Mr. Todd has held his position since January
2017. Messrs. Roll and West are the co-lead portfolio managers.
PURCHASE AND SALE OF PORTFOLIO SHARES
The minimum initial investment in
the Investor Class of the Portfolio is $5,000. Additional purchases may be
for any amount. You may purchase, redeem (sell) or exchange shares of the
Portfolio on any business day through certain authorized brokers and other
financial intermediaries or directly from the Portfolio by mail, telephone, or
wire.
TAX CONSIDERATIONS
The Portfolio’s distributions are
generally taxable to you as ordinary income, capital gains, or a combination of
the two, unless you are investing through a tax-deferred arrangement, such as a
401(k) plan or an individual retirement account. Upon withdrawal, your
investment through a tax-deferred arrangement may become taxable.
PAYMENTS TO BROKERS-DEALERS AND OTHER FINANCIAL
INTERMEDIARIES
If you purchase Portfolio shares
through a broker-dealer or other financial intermediary (such as a bank), the
Portfolio and its related companies may pay the intermediary for the sale of
Portfolio shares and related services. These payments may create a conflict of
interest by influencing the broker-dealer or other intermediary and your
salesperson to recommend the Portfolio over another investment. Ask your
salesperson or visit your financial intermediary’s website for more information.
|
|
|
|
|
PORTFOLIO
SUMMARY |
|
INTERNATIONAL SMALL COMPANIES PORTFOLIO
|
INVESTMENT OBJECTIVE
The International Small Companies
Portfolio (the “Portfolio”) seeks long-term capital appreciation through
investments in equity securities of small companies based outside the United
States.
PORTFOLIO FEES AND EXPENSES
This table describes the fees and
expenses that you may pay if you buy and hold shares of the Investor
Class of the Portfolio.
|
|
|
|
|
|
SHAREHOLDER
FEES
(fees paid directly from
your investment) |
|
|
|
Maximum Sales
Charge (Load) Imposed on Purchases (as a percentage of offering
price) |
|
|
None |
|
|
|
Redemption Fee (as
a percentage of amount redeemed within 90 days or less from the date of
purchase) |
|
|
None |
|
|
ANNUAL PORTFOLIO OPERATING
EXPENSES
(expenses that you pay
each year as a percentage of the value of your
investment) |
|
|
|
Management
Fees |
|
|
1.15% |
|
|
|
Distribution
(12b-1) Fees |
|
|
0.25% |
|
|
|
Other Expenses |
|
|
0.30% |
|
Total Annual Portfolio Operating
Expenses |
|
|
1.70% |
|
Fee Waiver and/or Expense
Reimbursement1 |
|
|
-0.30% |
|
|
|
Total Annual
Portfolio Operating Expenses After Fee Waiver and/or Expense
Reimbursement1 |
|
|
1.40% |
|
|
1Harding
Loevner LP has contractually agreed to waive a portion of its management
fee and/or reimburse the Investor Class of the Portfolio for its
other operating expenses to the extent Total Annual Portfolio Operating
Expenses (excluding dividend expenses, borrowing costs, interest expense
relating to short sales, interest, taxes, brokerage commissions and
extraordinary expenses), as a percentage of average daily net assets,
exceed 1.40% through February 28, 2021. This fee waiver and expense
reimbursement agreement may be terminated by the Board at any time and
will automatically terminate upon the termination of the Investment
Advisory Agreement. |
|
Example: This example is intended to help you compare the cost of investing
in the Investor Class of the Portfolio with the cost of investing in other
mutual funds. The example assumes that you invest $10,000 in the Investor
Class of the Portfolio for the time periods indicated and then redeem all
of your shares at the end of those periods. The example also assumes that your
investment has a 5% return each year and that the Investor Class’s operating
expenses remain the same, except that the example assumes the fee waiver and
expense reimbursement agreement pertains only through February 28, 2021.
Although your actual costs may be higher or lower, based on these assumptions
your costs would be:
|
|
|
|
|
|
|
|
|
|
|
1 YEAR |
|
3 YEARS |
|
5 YEARS |
|
10 YEARS |
|
|
|
|
$143 |
|
$506 |
|
$895 |
|
$1,984 |
PORTFOLIO TURNOVER
The Portfolio 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 Portfolio shares are held in a taxable
account. These costs, which are not reflected in annual portfolio operating
expenses or in the example, affect the Portfolio’s performance. During the most
recent fiscal year, the Portfolio’s portfolio turnover rate was 37% of the
average value of its portfolio.
PRINCIPAL INVESTMENT STRATEGIES
The Portfolio invests primarily in
small companies based outside the United States, including companies in emerging
and frontier as well as in developed markets. Harding Loevner LP (“Harding
Loevner”), the Portfolio’s investment adviser, undertakes fundamental research
in an effort to identify companies that are well managed, financially sound,
fast growing, and strongly competitive, and whose shares are reasonably priced
relative to estimates of their value.
Companies considered to be small are
those having a market capitalization, at time of purchase, within the range of
the market capitalization of companies in the Portfolio’s benchmark index,
currently the MSCI All Country World ex-U.S. Small Cap Index (the “Index”). As
of December 31, 2019, the range of market capitalization of companies in
the Index was US$35 million to US$9.151 billion. To reduce its
volatility, the Portfolio is diversified across dimensions of geography,
industry, and currency. The Portfolio normally holds investments across at least
15 countries.
Factors bearing on whether a company
is considered to be “based” outside the United States may include: (1) it
is legally domiciled outside the United States; (2) it conducts at least
50% of its business, as measured by the location of its sales, earnings, assets,
or production, outside the United States; or (3) it has the principal
exchange listing for its securities outside the United States.
The Portfolio will normally invest
broadly in equity securities of small companies domiciled in the following
countries and regions: (1) Europe; (2) the Pacific Rim;
(3) Canada and Mexico; and (4) countries with emerging or frontier
markets. At least 65% of the Portfolio’s total assets will be denominated in at
least three currencies other than the U.S. dollar. For purposes of compliance
with this restriction, American Depositary Receipts, Global Depositary Receipts,
and European Depositary Receipts (collectively, “Depositary Receipts”) will be
considered to be denominated in the currency of the country where the securities
underlying the Depositary Receipts are principally traded.
The Portfolio invests, under normal
circumstances, at least 80% of its net assets (plus any borrowings for
investment purposes) in common stocks, preferred stocks, rights, and warrants
issued by small companies that are based outside the United States, securities
convertible into such securities (including Depositary Receipts), and investment
companies that invest in the types of securities in which the Portfolio would
normally invest. If the Portfolio continues to hold securities of small
companies whose market capitalization, subsequent to purchase, grows to exceed
the upper range of the market capitalization of the Index, it may continue to
treat them as small for the purposes of the 80% requirement. The Portfolio also
may invest in securities of small U.S. companies that derive, or are expected to
derive, a significant portion of their revenues from their foreign operations,
although under normal circumstances not more than 15% of the Portfolio’s total
assets will be invested in securities of U.S. companies.
Because some emerging market
countries do not permit foreigners to participate directly in their securities
markets or otherwise present difficulties for efficient foreign investment, the
Portfolio may use equity derivative securities, and, in particular,
participation notes, to gain exposure to those countries.
PRINCIPAL RISKS
The Portfolio is subject to numerous
risks, any of which could cause an investor to lose money. The principal risks
of the Portfolio are as follows:
Market
Risk: Investments in the Portfolio may lose value due to a general
downturn in stock markets.
Currency
Risk: Foreign
currencies may experience steady or sudden devaluation relative to the U.S.
dollar, adversely affecting the value of the Portfolio’s investments. Because
the Portfolio’s net asset value is determined on the basis of U.S. dollars, if
the local currency of a foreign market depreciates against the U.S. dollar, you
may lose money even if the foreign market prices of the Portfolio’s holdings
rise.
Foreign Investment
Risk: Securities issued by foreign entities involve risks not associated
with U.S. investments. These risks include additional taxation, political,
economic, social or diplomatic instability, and the above-mentioned possibility
of changes in foreign currency exchange rates. There may also be less
publicly-available information about a foreign issuer. Such risks may be
magnified with respect to securities of issuers in frontier emerging markets.
Emerging and
Frontier Market Risk: Emerging and frontier market securities involve certain risks, such
as exposure to economies less diverse and mature than that of the United States
or more established foreign markets. Economic or political instability may cause
larger price changes in emerging or frontier market securities than in
securities of issuers based in more developed foreign countries.
Small Company
Risk: The
securities of small companies have historically exhibited more volatility with a
lower degree of liquidity than larger companies.
Participation Notes
Risk: Participation
notes are issued by banks, or broker-dealers, or their affiliates and are
designed to replicate the return of a particular underlying equity or debt
security, currency, or market. When the participation note matures, the issuer
of the participation note will pay to, or receive from, the Portfolio the
difference between the nominal value of the underlying instrument at the time of
purchase and that instrument’s value at maturity. Participation notes involve
the same risks associated with a direct investment in the underlying security,
currency, or market. In addition, participation notes involve counterparty risk,
because the Portfolio has no rights under participation notes against the
issuer(s) of the underlying security(ies) and must rely on the creditworthiness
of the issuer of the participation note.
NAV
Risk: The net
asset value of the Portfolio and the value of your investment will fluctuate.
PORTFOLIO PERFORMANCE
The following bar chart shows how
the investment results of the Portfolio’s Investor Class shares have varied from
year to year. The table that follows shows how the average annual total returns
of the Portfolio’s Investor Class shares compare with a broad measure of market
performance. Together, these provide an indication of the risks of investing in
the Portfolio. How the Investor Class shares of the Portfolio have
performed in the past (before and after taxes) is not necessarily an indication
of how they will perform in the future.
Updated Portfolio performance
information is available at www.hardingloevnerfunds.com or by calling
(877) 435-8105.
|
|
INTERNATIONAL SMALL COMPANIES PORTFOLIO |
The best calendar quarter return
during the period shown above was 17.39% in the third quarter of 2010; the worst
was -21.17% in the third quarter of 2011.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVERAGE ANNUAL TOTAL
RETURNS
(for the periods ended
December 31, 2019) |
|
|
|
1-YEAR |
|
|
5-YEAR |
|
|
10-YEAR |
|
|
INTERNATIONAL SMALL COMPANIES PORTFOLIO - INVESTOR CLASS |
|
|
|
|
|
Return
Before Taxes |
|
|
29.45% |
|
|
|
8.32% |
|
|
|
8.91% |
|
|
|
|
|
Return
After Taxes on Distributions1 |
|
|
29.39% |
|
|
|
7.71% |
|
|
|
8.37% |
|
|
|
|
|
Return
After Taxes on Distributions and Sale of Portfolio Shares1 |
|
|
17.65% |
|
|
|
6.56% |
|
|
|
7.27% |
|
|
|
|
|
MSCI ALL COUNTRY
WORLD ex-U.S. SMALL CAP (NET) INDEX (reflects no deduction for fees,
expenses, or U.S. taxes) |
|
|
22.42% |
|
|
|
7.04% |
|
|
|
6.92% |
|
|
1After-tax
returns in the table above are calculated using the historical highest
individual federal marginal income tax rates and do not reflect the impact
of state and local taxes. Actual after-tax returns depend on an
investor’s tax situation and may differ from those shown, and after-tax
returns shown are not relevant to investors who hold their Portfolio
shares through tax-deferred arrangements, such as 401(k) plans or
Individual Retirement Accounts. |
|
MANAGEMENT
Investment Adviser
Harding Loevner serves as investment
adviser to the Portfolio.
Portfolio Managers
Jafar Rizvi and Anix Vyas serve as
the portfolio managers of the International Small Companies Portfolio.
Mr. Rizvi has held his position since June 2011 and Mr. Vyas has held
his position since April 2018. Messrs. Rizvi and Vyas are co-lead portfolio
managers.
PURCHASE AND SALE OF PORTFOLIO SHARES
The minimum initial investment in
the Investor Class of the Portfolio is $5,000. Additional purchases may be
for any amount. You may purchase, redeem (sell) or exchange shares of the
Portfolio on any business day through certain authorized brokers and other
financial intermediaries or directly from the Portfolio by mail, telephone, or
wire.
TAX CONSIDERATIONS
The Portfolio’s distributions are
generally taxable to you as ordinary income, capital gains, or a combination of
the two, unless you are investing through a tax-deferred arrangement, such as a
401(k) plan or an individual retirement account. Upon withdrawal, your
investment through a tax-deferred arrangement may become taxable.
PAYMENTS TO BROKERS-DEALERS AND OTHER FINANCIAL
INTERMEDIARIES
If you purchase Portfolio shares
through a broker-dealer or other financial intermediary (such as a bank), the
Portfolio and its related companies may pay the intermediary for the sale of
Portfolio shares and related services. These payments may create a conflict of
interest by influencing the broker-dealer or other intermediary and your
salesperson to recommend the Portfolio over another investment. Ask your
salesperson or visit your financial intermediary’s website for more information.
|
|
|
|
|
PORTFOLIO
SUMMARY |
|
EMERGING MARKETS
PORTFOLIO |
INVESTMENT OBJECTIVE
The Emerging Markets Portfolio (the
“Portfolio”) seeks long-term capital appreciation through investments in equity
securities of companies based in emerging markets.
PORTFOLIO FEES AND EXPENSES
This table describes the fees and
expenses that you may pay if you buy and hold shares of the Advisor
Class of the Portfolio. The table does not take into account brokerage
commissions that you may pay on your purchases and sales of Advisor Class shares
of the Portfolio.
|
|
|
|
|
|
SHAREHOLDER
FEES
(fees paid directly from
your investment) |
|
|
|
Maximum Sales
Charge (Load) Imposed on Purchases (as a percentage of offering
price) |
|
|
None |
|
|
|
Redemption Fee (as
a percentage of amount redeemed within 90 days or less from the date of
purchase) |
|
|
None |
|
|
ANNUAL PORTFOLIO OPERATING
EXPENSES
(expenses that you pay
each year as a percentage of the value of your
investment) |
|
|
|
Management
Fees |
|
|
1.12% |
|
|
|
Distribution
(12b-1) Fees |
|
|
None |
|
|
|
Other Expenses |
|
|
0.25% |
|
Total Annual Portfolio Operating
Expenses |
|
|
1.37% |
|
Fee Waiver and/or Expense
Reimbursement1 |
|
|
0.00% |
|
|
|
Total Annual
Portfolio Operating Expenses After Fee Waiver and/or Expense
Reimbursement1 |
|
|
1.37% |
|
|
1Harding
Loevner LP has contractually agreed to waive a portion of its management
fee and/or reimburse the Advisor Class of the Portfolio for its other
operating expenses to the extent Total Annual Portfolio Operating Expenses
(excluding dividend expenses, borrowing costs, interest expense relating
to short sales, interest, taxes, brokerage commissions and extraordinary
expenses), as a percentage of average daily net assets, exceed 1.75%
through February 28, 2021. This fee waiver and expense reimbursement
agreement may be terminated by the Board at any time and will
automatically terminate upon the termination of the Investment Advisory
Agreement. |
|
Example: This example is intended to help you compare the cost of investing
in the Advisor Class of the Portfolio with the cost of investing in other
mutual funds. The example assumes that you invest $10,000 in the Advisor
Class of the Portfolio for the time periods indicated and then redeem all
of your shares at the end of those periods. The example also assumes that your
investment has a 5% return each year and that the Advisor Class’s operating
expenses remain the same. The example does not take into account brokerage
commissions that you may pay on your purchases and sales of Advisor Class shares
of the Portfolio. Although your actual costs may be higher or lower, based on
these assumptions your costs would be:
|
|
|
|
|
|
|
|
|
|
|
1 YEAR |
|
3 YEARS |
|
5 YEARS |
|
10 YEARS |
|
|
|
|
$139 |
|
$434 |
|
$750 |
|
$1,646 |
PORTFOLIO TURNOVER
The Portfolio 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 Portfolio shares are held in a taxable
account. These costs, which are not reflected in annual portfolio operating
expenses or in the example, affect the Portfolio’s performance. During the most
recent fiscal year, the Portfolio’s portfolio turnover rate was 19% of the
average value of its portfolio.
PRINCIPAL INVESTMENT STRATEGIES
The Portfolio invests primarily in
companies that are based in emerging and frontier markets. Emerging and frontier
markets offer investment opportunities that arise from long-term trends in
demographics, deregulation, offshore outsourcing, and improving corporate
governance in developing countries. Harding Loevner LP (“Harding Loevner”), the
Portfolio’s investment adviser, undertakes fundamental research in an effort to
identify companies that are well managed, financially sound, fast growing, and
strongly competitive, and whose shares are reasonably priced relative to
estimates of their value. To reduce its volatility, the Portfolio is diversified
across dimensions of geography, industry, and currency. The Portfolio normally
holds investments across at least 15 countries. Emerging and frontier
markets include countries that have an emerging stock market as defined by
Morgan Stanley Capital International, countries or markets with low- to
middle-income economies as classified by the World Bank, and other countries or
markets with similar characteristics. Emerging and frontier markets tend to have
relatively low gross national product per capita compared to the world’s major
economies and may have the potential for rapid economic growth.
Factors bearing on whether a company
is considered to be “based” in an emerging or frontier market may include:
(1) it is legally domiciled in an emerging or frontier market; (2) it
conducts at least 50% of its business, as measured by the location of its sales,
earnings, assets, or production, in an emerging or frontier market; or
(3) it has the principal exchange listing for its securities in an emerging
or frontier market.
The Portfolio will invest broadly in
equity securities of companies domiciled in one of at least 15 countries with
emerging or frontier markets, generally considered to include all countries
except Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany,
Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand,
Norway, Portugal, Singapore, Spain, Sweden, Switzerland, the United Kingdom, and
the United States. At least 65% of the Portfolio’s total assets will be
denominated in at least three currencies other
than the U.S. dollar. For purposes
of compliance with this restriction, American Depositary Receipts, Global
Depositary Receipts, and European Depositary Receipts (collectively, “Depositary
Receipts”) will be considered to be denominated in the currency of the country
where the securities underlying the Depositary Receipts are principally traded.
The Portfolio invests at least 65%
of its total assets in common stocks, preferred stocks, rights, and warrants
issued by companies that are based in emerging or frontier markets, securities
convertible into such securities (including Depositary Receipts), and investment
companies that invest in the types of securities in which the Portfolio would
normally invest. The Portfolio also may invest in securities of U.S. companies
that derive, or are expected to derive, a significant portion of their revenues
from their foreign operations, although under normal circumstances, not more
than 15% of the Portfolio’s total assets will be invested in securities of U.S.
companies.
The Portfolio invests, under normal
circumstances, at least 80% of its net assets (plus any borrowings for
investment purposes) in emerging markets securities, which includes frontier
markets securities, and investment companies that invest in the types of
securities in which the Portfolio would normally invest.
Because some emerging market
countries do not permit foreigners to participate directly in their securities
markets or otherwise present difficulties for efficient foreign investment, the
Portfolio may use equity derivative securities, and, in particular,
participation notes, to gain exposure to those countries.
PRINCIPAL RISKS
The Portfolio is subject to numerous
risks, any of which could cause an investor to lose money. The principal risks
of the Portfolio are as follows:
Market
Risk: Investments in the Portfolio may lose value due to a general
downturn in stock markets.
Currency
Risk: Foreign
currencies may experience steady or sudden devaluation relative to the U.S.
dollar, adversely affecting the value of the Portfolio’s investments. Because
the Portfolio’s net asset value is determined on the basis of U.S. dollars, if
the local currency of a foreign market depreciates against the U.S. dollar, you
may lose money even if the foreign market prices of the Portfolio’s holdings
rise.
Foreign Investment
Risk: Securities issued by foreign entities involve risks not associated
with U.S. investments. These risks include additional taxation, political,
economic, social or diplomatic instability, and the above-mentioned possibility
of changes in foreign currency exchange rates. There may also be less
publicly-available information about a foreign issuer. Such risks may be
magnified with respect to securities of issuers in frontier emerging markets.
Emerging and
Frontier Market Risk: Emerging and frontier market securities involve certain risks, such
as exposure to economies less diverse and mature than that of the United States
or more established foreign markets. Economic or political instability may cause
larger price changes in emerging or frontier market securities than in
securities of issuers based in more developed foreign countries.
Participation Notes
Risk: Participation notes are issued by banks, or broker-dealers, or
their affiliates and are designed to replicate the return of a particular
underlying equity or debt security, currency, or market. When the participation
note matures, the issuer of the participation note will pay to, or receive from,
the Portfolio the difference between the nominal value of the underlying
instrument at the time of purchase and that instrument’s value at maturity.
Participation notes involve the same risks associated with a direct investment
in the underlying security, currency, or market. In addition, participation
notes involve counterparty risk, because the Portfolio has no rights under
participation notes against the issuer(s) of the underlying security(ies) and
must rely on the creditworthiness of the issuer of the participation note.
NAV
Risk: The net
asset value of the Portfolio and the value of your investment will fluctuate.
Financials Sector
Risk: To the
extent the Portfolio invests in securities and other obligations of issuers in
the financials sector, the Portfolio will be vulnerable to events affecting
companies in the financials industry. Examples of risks affecting the financials
sector include changes in governmental regulation, issues relating to the
availability and cost of capital, changes in interest rates and/or monetary
policy, and price competition. In addition, financials companies are often more
highly leveraged than other companies, making them inherently riskier. As of
October 31, 2019, the Portfolio had 20.9% of net assets invested in the
financials sector.
PORTFOLIO PERFORMANCE
The following bar chart shows how
the investment results of the Portfolio’s Advisor Class shares have varied from
year to year. The table that follows shows how the average total returns of the
Portfolio’s Advisor Class shares compare with a broad measure of market
performance. Together these provide an indication of the risks of investing in
the Portfolio. How the Advisor Class shares of the Portfolio have performed in
the past (before and after taxes) is not necessarily an indication of how they
will perform in the future.
Updated Portfolio performance
information is available at www.hardingloevnerfunds.com or by calling
(877) 435-8105.
|
|
EMERGING MARKETS PORTFOLIO |
The best calendar quarter return
during the period shown above was 19.93% in the third quarter of 2010; the worst
was -21.20% in the third quarter of 2011.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVERAGE ANNUAL TOTAL
RETURNS
(for the periods ended
December 31, 2019) |
|
|
|
1-YEAR |
|
|
5-YEAR |
|
|
10-YEAR |
|
|
EMERGING
MARKETS PORTFOLIO - ADVISOR CLASS |
|
|
|
|
|
Return
Before Taxes |
|
|
25.80% |
|
|
|
6.23% |
|
|
|
5.44% |
|
|
|
|
|
Return
After Taxes on Distributions1 |
|
|
25.53% |
|
|
|
6.15% |
|
|
|
5.08% |
|
|
|
|
|
Return
After Taxes on Distributions and Sale of Portfolio Shares1 |
|
|
15.72% |
|
|
|
4.99% |
|
|
|
4.41% |
|
|
|
|
|
MSCI EMERGING
MARKETS (NET) INDEX (reflects no deduction for fees, expenses, or
U.S. taxes) |
|
|
18.42% |
|
|
|
5.61% |
|
|
|
3.68% |
|
|
1After-tax
returns in the table above are calculated using the historical highest
individual federal marginal income tax rates and do not reflect the impact
of state and local taxes. Actual after-tax returns depend on an investor’s
tax situation and may differ from those shown, and after-tax returns shown
are not relevant to investors who hold their Portfolio shares through
tax-deferred arrangements, such as 401(k) plans or Individual Retirement
Accounts. |
|
MANAGEMENT
Investment Adviser
Harding Loevner serves as investment
adviser to the Portfolio.
Portfolio Managers
Scott Crawshaw, Craig Shaw, Pradipta
Chakrabortty, G. Rusty Johnson, and Richard Schmidt serve as the portfolio
managers of the Emerging Markets Portfolio. Mr. Crawshaw has held his
position since June 2014, Mr. Shaw has held his position since December
2006, Mr. Chakrabortty has held his position since January 2015,
Mr. Johnson has held his position since the Portfolio’s inception in
November 1998, and Mr. Schmidt has held his position since December 2011.
Messrs. Crawshaw and Shaw are the co-lead portfolio managers.
PURCHASE AND SALE OF PORTFOLIO SHARES
The minimum initial investment in
the Advisor Class of the Portfolio is $5,000. Additional purchases may be
for
any amount. You may purchase, redeem
(sell) or exchange shares of the Portfolio on any business day through certain
authorized brokers and other financial intermediaries or directly from the
Portfolio by mail, telephone, or wire.
Shares of the Emerging Markets
Portfolio may not be available for purchase by all investors through financial
intermediaries. For more information, see the section captioned
“Shareholder Information—Purchase and Redemption of Shares” in the Portfolio’s
prospectus.
TAX CONSIDERATIONS
The Portfolio’s distributions are
generally taxable to you as ordinary income, capital gains, or a combination of
the two, unless you are investing through a tax-deferred arrangement, such as a
401(k) plan or an individual retirement account. Upon withdrawal, your
investment through a tax-deferred arrangement may become taxable.
PAYMENTS TO BROKERS-DEALERS AND OTHER FINANCIAL
INTERMEDIARIES
If you purchase Portfolio shares
through a broker-dealer or other financial intermediary (such as a bank), the
Portfolio and its related companies may pay the intermediary for the sale of
Portfolio shares and related services. These payments may create a conflict of
interest by influencing the broker-dealer or other intermediary and your
salesperson to recommend the Portfolio over another investment. Ask your
salesperson or visit your financial intermediary’s website for more information.
|
|
|
|
|
PORTFOLIO
SUMMARY |
|
FRONTIER EMERGING MARKETS
PORTFOLIO |
INVESTMENT OBJECTIVE
The Frontier Emerging Markets
Portfolio (the “Portfolio”) seeks long-term capital appreciation through
investments in equity securities of companies based in frontier and smaller
emerging markets.
PORTFOLIO FEES AND EXPENSES
This table describes the fees and
expenses that you may pay if you buy and hold shares of the Investor
Class of the Portfolio.
|
|
|
|
|
|
SHAREHOLDER
FEES
(fees paid directly from
your investment) |
|
|
|
Maximum Sales
Charge (Load) Imposed on Purchases (as a percentage of offering
price) |
|
|
None |
|
|
|
Redemption Fee (as
a percentage of amount redeemed within 90 days or less from the date of
purchase) |
|
|
None |
|
|
ANNUAL PORTFOLIO OPERATING
EXPENSES
(expenses that you pay
each year as a percentage of the value of your
investment) |
|
|
|
Management
Fees |
|
|
1.35% |
|
|
|
Distribution
(12b-1) Fees |
|
|
0.25% |
|
|
|
Other Expenses |
|
|
0.40% |
|
Total Annual Portfolio Operating
Expenses |
|
|
2.00% |
|
Fee Waiver and/or Expense
Reimbursement1 |
|
|
0.00% |
|
|
|
Total Annual
Portfolio Operating Expenses After Fee Waiver and/or Expense
Reimbursement1 |
|
|
2.00% |
|
|
1Harding
Loevner LP has contractually agreed to waive a portion of its management
fee and/or reimburse the Investor Class of the Portfolio for its
other operating expenses to the extent Total Annual Portfolio Operating
Expenses (excluding dividend expenses, borrowing costs, interest expense
relating to short sales, interest, taxes, brokerage commissions and
extraordinary expenses), as a percentage of average daily net assets,
exceed 2.00% through February 28, 2021. This fee waiver and expense
reimbursement agreement may be terminated by the Board at any time and
will automatically terminate upon the termination of the Investment
Advisory Agreement. |
|
Example: This example is intended to help you compare the cost of investing
in the Investor Class of the Portfolio with the cost of investing in other
mutual funds. The example assumes that you invest $10,000 in the Investor
Class of the Portfolio for the time periods indicated and then redeem all
of your shares at the end of those periods. The example also assumes that your
investment has a 5% return each year and that the Investor Class’s operating
expenses remain the same. Although your actual costs may be higher or lower,
based on these assumptions your costs would be:
|
|
|
|
|
|
|
|
|
|
|
1 YEAR |
|
3 YEARS |
|
5 YEARS |
|
10 YEARS |
|
|
|
|
$203 |
|
$627 |
|
$1,078 |
|
$2,327 |
PORTFOLIO TURNOVER
The Portfolio 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 Portfolio shares are held in a taxable account. These costs,
which are not reflected in annual portfolio operating expenses or in the
example, affect the Portfolio’s performance. During the most recent fiscal year,
the Portfolio’s portfolio turnover rate was 31% of the average value of its
portfolio.
PRINCIPAL INVESTMENT STRATEGIES
The Portfolio invests primarily in
companies that are based in frontier emerging markets, including the smaller
traditionally-recognized emerging markets. Frontier emerging markets, with the
exception of the oil-producing Gulf States and certain of the smaller
traditionally-recognized emerging markets, tend to have relatively low gross
national product per capita compared to the larger traditionally-recognized
emerging markets and the world’s major developed economies. The frontier
emerging markets include the least developed markets even by emerging markets
standards. Frontier emerging markets offer investment opportunities that arise
from long-term trends in demographics, deregulation, offshore outsourcing and
improving corporate governance in developing countries. Harding Loevner LP
(“Harding Loevner”), the Portfolio’s investment adviser, undertakes fundamental
research in an effort to identify companies that are well managed, financially
sound, fast growing, and strongly competitive, and whose shares are reasonably
priced relative to estimates of their value. To reduce its volatility, the
Portfolio is diversified across dimensions of geography, industry, and currency.
The Portfolio normally holds investments across at least 15 countries.
As used herein, frontier emerging
markets include countries that are represented in the MSCI Frontier Markets
Index or the S&P Frontier Markets BMI, or similar market indices, and the
smaller of the traditionally-recognized emerging markets, such as those
individually constituting less than 5% of the MSCI Emerging Markets Index or the
S&P Emerging Markets BMI. Factors bearing on whether a company is considered
to be “based” in a frontier emerging market may include: (1) it is legally
domiciled in a frontier emerging market; (2) it conducts at least 50% of
its business, as measured by the location of its sales, earnings, assets, or
production, in frontier emerging markets; or (3) it has the principal
exchange listing for its securities in a frontier emerging market. Frontier
emerging markets generally include all countries except Australia, Austria,
Belgium, Canada, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel,
Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain,
Sweden, Switzerland, the United Kingdom, and the United States and the
larger traditionally-recognized emerging markets of Taiwan, South Korea, Mexico,
South Africa, Brazil, India, China,
and Russia. At least 65% of the
Portfolio’s total assets will be denominated in at least three currencies
other than the U.S. dollar. For purposes of compliance with this restriction,
American Depositary Receipts, Global Depositary Receipts, and European
Depositary Receipts (collectively, “Depositary Receipts”) will be considered to
be denominated in the currency of the country where the securities underlying
the Depositary Receipts are principally traded.
The Portfolio invests at least 65%
of its total assets in common stocks, preferred stocks, rights, and warrants
issued by companies that are based in the frontier emerging markets, securities
convertible into such securities (including Depositary Receipts), and investment
companies that invest in the types of securities in which the Portfolio would
normally invest. The Portfolio also may invest in securities of U.S. companies
that derive, or are expected to derive, a significant portion of their revenues
from their foreign operations, although under normal circumstances, not more
than 15% of the Portfolio’s total assets will be invested in securities of U.S.
companies.
The Portfolio invests, under normal
circumstances, at least 80% of its net assets (plus any borrowings for
investment purposes) in frontier emerging market securities, and investment
companies that invest in the types of securities in which the Portfolio would
normally invest.
The Portfolio may invest up to 35%
of its total assets in securities of companies in any one industry if, at the
time of investment, that industry represents 20% or more of the Portfolio’s
benchmark index, currently the MSCI Frontier Emerging Markets Index.
Because some frontier emerging
market countries do not permit foreigners to participate directly in their
securities markets or otherwise present difficulties for efficient foreign
investment, the Portfolio may use equity derivative securities, and, in
particular, participation notes, to gain exposure to those countries.
PRINCIPAL RISKS
The Portfolio is subject to numerous
risks, any of which could cause an investor to lose money. The principal risks
of the Portfolio are as follows:
Market
Risk: Investments in the Portfolio may lose value due to a general
downturn in stock markets.
Currency
Risk: Foreign
currencies may experience steady or sudden devaluation relative to the U.S.
dollar, adversely affecting the value of the Portfolio’s investments. Because
the Portfolio’s net asset value is determined on the basis of U.S. dollars, if
the local currency of a foreign market depreciates against the U.S. dollar, you
may lose money even if the foreign market prices of the Portfolio’s holdings
rise.
Foreign Investment
Risk: Securities issued by foreign entities involve risks not associated
with U.S. investments. These risks include additional taxation,
political, economic, social or
diplomatic instability, and the above-mentioned possibility of changes in the
foreign currency exchange rates. There may also be less publicly-available
information about a foreign issuer. Such risks may be magnified with respect to
securities of issuers in frontier emerging markets.
Frontier Emerging
Market Risk: Frontier emerging market securities involve certain risks, such as
exposure to economies less diverse and mature than that of the United States or
more established foreign markets. Economic or political instability may cause
larger price changes in frontier emerging market securities than in securities
of issuers based in more developed foreign countries, including securities of
issuers based in larger emerging markets. Frontier emerging markets generally
receive less investor attention than developed markets and larger emerging
markets.
Participation Notes
Risk: Participation notes are issued by banks, or broker-dealers, or
their affiliates and are designed to replicate the return of a particular
underlying equity or debt security, currency, or market. When the participation
note matures, the issuer of the participation note will pay to, or receive from,
the Portfolio the difference between the nominal value of the underlying
instrument at the time of purchase and that instrument’s value at maturity.
Participation notes involve the same risks associated with a direct investment
in the underlying security, currency, or market. In addition, participation
notes involve counterparty risk, because the Portfolio has no rights under
participation notes against the issuer(s) of the underlying security(ies) and
must rely on the creditworthiness of the issuer of the participation note.
Concentration
Risk: The
Portfolio may invest up to 35% of its total assets in securities of companies in
any one industry if, at the time of investment, that industry represents 20% or
more of the Portfolio’s benchmark index, currently the MSCI Frontier Emerging
Markets Index. Accordingly, at any time the Portfolio has such a concentration
of investments in a single industry group, it will be particularly vulnerable to
factors that adversely affect that industry group.
NAV
Risk: The net
asset value of the Portfolio and the value of your investment will fluctuate.
Financials Sector
Risk: To the
extent the Portfolio invests in securities and other obligations of issuers in
the financials sector, the Portfolio will be vulnerable to events affecting
companies in the financials industry. Examples of risks affecting the financials
sector include changes in governmental regulation, issues relating to the
availability and cost of capital, changes in interest rates and/or monetary
policy, and price competition. In addition, financials companies are often more
highly leveraged than other companies, making them inherently riskier. As of
October 31, 2019, the Portfolio had 33.7% of net assets invested in the
financials sector.
PORTFOLIO PERFORMANCE
The following bar chart shows how
the investment results of the Portfolio’s Investor Class shares have varied
from year to year. The table that
follows shows how the average annual total returns of the Portfolio’s Investor
Class shares compare with a broad measure of market performance. Together, these
provide an indication of the risks of investing in the Portfolio. How the
Investor Class shares of the Portfolio have performed in the past (before
and after taxes) is not necessarily an indication of how they will perform in
the future.
Updated Portfolio performance
information is available at www.hardingloevnerfunds.com or by calling
(877) 435-8105.
|
|
FRONTIER EMERGING MARKETS PORTFOLIO |
The best calendar quarter return
during the period shown above was 10.42% in the first quarter of 2012; the worst
was -15.70% in the third quarter of 2011.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVERAGE ANNUAL TOTAL
RETURNS
(for the periods ended
December 31, 2019) |
|
|
|
1-YEAR |
|
|
5 YEARS |
|
|
SINCE INCEPTION 12/31/10 |
|
|
FRONTIER
EMERGING MARKETS PORTFOLIO - INVESTOR CLASS |
|
|
|
|
|
Return
Before Taxes |
|
|
10.42% |
|
|
|
-1.02% |
|
|
|
1.09% |
|
|
|
|
|
Return
After Taxes on Distributions1 |
|
|
10.26% |
|
|
|
-1.10% |
|
|
|
1.00% |
|
|
|
|
|
Return
After Taxes on Distributions and Sale of Portfolio Shares1 |
|
|
6.69% |
|
|
|
-0.62% |
|
|
|
0.95% |
|
|
|
|
|
MSCI FRONTIER EMERGING MARKETS (NET)
INDEX
(reflects no deduction for fees,
expenses, or U.S. taxes) |
|
|
14.10% |
|
|
|
1.17% |
|
|
|
1.86% |
|
|
1After-tax
returns in the table above are calculated using the historical highest
individual federal marginal income tax rates and do not reflect the impact
of state and local taxes. The return after taxes on distributions and sale
of Portfolio shares may exceed the Portfolio’s other returns due to an
assumed tax benefit from any losses on a sale of Portfolio shares at the
end of the measurement period. Actual after-tax returns depend on an
investor’s tax situation and may differ from those shown, and after-tax
returns shown are not relevant to investors who hold their Portfolio
shares through tax-deferred arrangements, such as 401(k) plans or
Individual Retirement Accounts. |
|
MANAGEMENT
Investment Adviser
Harding Loevner serves as investment
adviser to the Portfolio.
Portfolio Managers
Pradipta Chakrabortty and Babatunde
Ojo serve as the portfolio managers of the Frontier Emerging Markets Portfolio.
Mr. Chakrabortty has held his position since December 2008 and Mr. Ojo
has held his position since June 2014. Messrs. Chakrabortty and Ojo are co-lead
portfolio managers.
PURCHASE AND SALE OF PORTFOLIO SHARES
The minimum initial investment in
the Investor Class of the Portfolio is $5,000. Additional purchases may be
for any amount. You may purchase, redeem (sell) or exchange shares of the
Portfolio on any business day through certain authorized brokers and other
financial intermediaries or directly from the Portfolio by mail, telephone, or
wire.
TAX CONSIDERATIONS
The Portfolio’s distributions are
generally taxable to you as ordinary income, capital gains, or a combination of
the two, unless you are investing through a tax-deferred arrangement, such as a
401(k) plan or an individual retirement account. Upon withdrawal, your
investment through a tax-deferred arrangement may become taxable.
PAYMENTS TO BROKERS-DEALERS AND OTHER FINANCIAL
INTERMEDIARIES
If you purchase Portfolio shares
through a broker-dealer or other financial intermediary (such as a bank), the
Portfolio and its related companies may pay the intermediary for the sale of
Portfolio shares and related services. These payments may create a conflict of
interest by influencing the broker-dealer or other intermediary and your
salesperson to recommend the Portfolio over another investment. Ask your
salesperson or visit your financial intermediary’s website for more information.
INVESTMENT OBJECTIVES AND INVESTMENT
PROCESS
Harding, Loevner Funds, Inc. (the
“Fund”) is a no-load, open-end management investment company that currently has
nine separate diversified portfolios, including the Global Equity Portfolio,
International Equity Portfolio, International Small Companies Portfolio,
Emerging Markets Portfolio, and Frontier Emerging Markets Portfolio, whose
Advisor and Investor Class shares are offered in this Prospectus (each, a
“Portfolio,” and collectively, the “Portfolios”). Each Portfolio has its own
investment objective, strategy, and policies. The Fund is advised by Harding
Loevner. There is no assurance that a Portfolio will achieve its investment
objective.
The investment objectives, policies,
and risks of the Portfolios are detailed below. Except as otherwise indicated,
the Fund’s board of directors (the “Board of Directors”) may change the
investment policies at any time to the extent that such changes are consistent
with the investment objective of the applicable Portfolio.
However, each Portfolio’s investment
objective is fundamental and may not be changed without a majority vote of the
Portfolio’s outstanding shares, which is defined under the Investment Company
Act of 1940, as amended, as the lesser of (a) 67% of the shares of the
applicable Portfolio present or represented if the holders of more than 50% of
the shares are present or represented at the shareholders’ meeting, or
(b) more than 50% of the shares of the applicable Portfolio (a “majority
vote”).
The Portfolios may, from time to
time, take temporary defensive positions that are inconsistent with the
Portfolios’ principal investment strategies in attempting to respond to adverse
changes in market and economic conditions. For temporary defensive purposes, the
Portfolios may temporarily hold cash (foreign currencies or multinational
currency) and/or invest up to 100% of their assets in high quality debt
securities or money market instruments of U.S. or foreign issuers. The
Portfolios may miss certain investment opportunities if they use such temporary
defensive strategies and thus may not achieve their investment objectives.
INVESTMENT OBJECTIVES
The investment objective of each
Portfolio is:
|
|
|
Portfolio |
|
Objective |
Global
Equity |
|
Seeks
long-term capital appreciation through investments in equity securities of
companies based both inside and outside the
United States |
International Equity |
|
Seeks
long-term capital appreciation through investments in equity securities of
companies based outside the United States |
International Small Companies |
|
Seeks
long-term capital appreciation through investments in equity securities of
small companies based outside the United States |
Emerging
Markets |
|
Seeks
long-term capital appreciation through investments in equity securities of
companies based in emerging markets |
Frontier
Emerging Markets |
|
Seeks
long-term capital appreciation through investments in equity securities of
companies based in frontier and smaller emerging
markets |
INVESTMENT PROCESS
Harding Loevner believes investing
in the shares of high-quality growing businesses at reasonable prices leads to
superior risk-adjusted returns over the long-term. The firm manages the
Portfolios utilizing a bottom-up, business-focused approach based on careful
study of individual companies and the competitive dynamics of the global
industries in which they participate. The process Harding Loevner uses to
identify and value companies consists of four parts: (1) Initial
Qualification of companies for further research; (2) In-Depth
Research into the businesses of qualified candidates; (3) Valuation
and Rating of securities of potential investments; and (4) Portfolio
Construction by selecting from analyst-rated securities to create a
diversified portfolio from the most-promising opportunities.
To qualify companies for intensive
research, Harding Loevner’s investment analysts survey companies in their
assigned portions of the investment universe to identify potential candidates
that meet four key criteria. They must exhibit: (i) Competitive Advantages
that enable them to earn high margins that can be sustained over time;
(ii) Sustainable Growth in sales, earnings, and cash flows;
(iii) Financial Strength, in terms of free cash flow and available
borrowing capacity; and (iv) Quality Management including a proven record
of success and respect for interests of minority shareholders. Sources for
investment ideas include, but are not limited to, analysts’ investigations into
the competitors, suppliers, and customers of existing companies under research;
their encounters with companies during onsite company visits, investor
conferences, trade shows, and other research travel; and objective screens on
company fundamentals using Harding Loevner’s quality and growth metrics.
Companies that appear qualified on
these key criteria are then examined more intensively using primary and
secondary sources, including company reports, management interviews, contact
with trade associations, and visits to company facilities. Investment analysts
assess qualified companies on ten competitive management and financial
characteristics using a proprietary scoring system known as the Quality
Assessment (“QA”) framework. This framework aids analysts in gaining insight
into companies’ competitive positions and the extent and durability of their
growth prospects, and facilitates comparing businesses across different
countries and industries.
To evaluate the investment potential
of the strongest candidates, analysts use a multi-stage cash-flow return on
investment approach to construct financial models incorporating their forecasts
for long-term growth in earnings and cash flows. The financial models include
adjustments based upon the QA score. Analysts primarily use a discounted cash
flow analysis to estimate the value of companies’ securities. Based upon their
business forecasts and evaluation of investment potential, analysts predict the
relative price performance of stocks under their coverage, and issue purchase
and sale recommendations accordingly. When issuing a recommendation on the stock
of a company, analysts
also set out expectations for the
future business performance of the company (“mileposts”). These mileposts
provide analysts with an indelible record of their expectations for the business
and form the basis of ongoing review of the company’s progress.
In constructing portfolios for the
Global Equity, International Equity, International Small Companies, Emerging
Markets, and Frontier Emerging Markets Portfolios, Harding Loevner’s portfolio
managers select among the analyzed securities. The portfolio managers take into
consideration the securities’ predicted relative price performance, the
timeliness and investment potential, the implications for portfolio risk of
their selections, and the requirement to observe portfolio diversification
guidelines.
A holding is reduced or removed from
a Portfolio if and when it: (i) grows to too large a proportion of the
portfolio, in terms of its impact on portfolio risk; (ii) becomes
substantially overpriced in relation to its estimated value; (iii) fails to
achieve the pre-established milestones for business (as opposed to share price)
performance, including breach of trust by management; or (iv) is displaced
by more compelling investment opportunities.
ADDITIONAL INFORMATION ON PORTFOLIO
INVESTMENT STRATEGIES AND RISKS
OTHER INVESTMENT STRATEGIES
The Global Equity, International
Equity, and International Small Companies Portfolios may each invest up to 20%,
and the Emerging Markets and Frontier Emerging Markets Portfolios may each
invest up to 35%, of their respective total assets in debt securities of
domestic and foreign issuers, including emerging market and frontier emerging
market issuers. The types of debt securities the Portfolios may invest in
include instruments such as corporate bonds, debentures, notes, commercial
paper, short-term notes, medium-term notes, and variable rate notes. Such
securities may be rated below investment grade, that is, rated below Baa by
Moody’s or below BBB by S&P and in unrated securities judged to be of
equivalent quality (commonly referred to as “junk bonds”) as determined by
Harding Loevner. However, a Portfolio may not invest in securities rated, at the
time of investment, C or below by Moody’s, or D or below by S&P, or in
securities of comparable quality as determined by Harding Loevner.
RISKS ASSOCIATED WITH THE PORTFOLIOS’ INVESTMENT POLICIES
AND TECHNIQUES
The share price of a Portfolio will
change daily based on changes in the value of the securities that a Portfolio
holds. The principal risks of investing in each of the Portfolios and the
circumstances reasonably likely to cause the value of your investment to decline
are described in the “Portfolio Summary” section of each Portfolio in this
Prospectus. Additional information concerning those principal risks and the
additional risks that apply to each Portfolio are set forth below. Please note
that there are other circumstances that are not described here that could cause
the value of your investment to decline and prevent a Portfolio from achieving
its investment objective.
Market
Risk. The risk
that the value of the securities in which a Portfolio invests may go up or down
in response to the prospects of individual companies, particular industry
sectors or governments and/or such factors as general economic conditions,
political or regulatory developments, changes in interest rates, and perceived
desirability of equity securities relative to other investments. Price changes
may be temporary or last for extended periods. A Portfolio’s investments may be
over-weighted from time to time in one or more industry sectors, which will
increase the Portfolio’s exposure to risk of loss from adverse developments
affecting those sectors.
Currency
Risk. Investments in foreign currencies are subject to the risk that
those currencies will decline in value relative to the U.S. dollar or, in the
case of hedged
positions, that the U.S. dollar will
decline relative to the currency being hedged. Currency exchange rates may
experience steady or sudden fluctuation over short periods of time. A decline in
the value of foreign currencies relative to the U.S. dollar will reduce the
value of securities held by a Portfolio and denominated in those currencies. A
Portfolio may seek to reduce currency risk by hedging part or all of its
exposure to various foreign currencies, although a Portfolio generally does not
hedge foreign currency exposure; however, if such hedging techniques are
employed, there is no assurance that they will be successful.
Foreign
Investments. Securities issued by foreign governments, foreign corporations,
international agencies and obligations of foreign banks involve risks not
associated with securities issued by U.S. entities. Changes in foreign currency
exchange rates may affect the value of investments of a Portfolio. With respect
to certain foreign countries, there is the possibility of expropriation of
assets, confiscatory taxation and political or social instability or diplomatic
developments that could affect investment in those countries. There may be less
publicly-available information about a foreign financial instrument than about a
U.S. instrument and foreign entities may not be subject to accounting, auditing
and financial reporting standards and requirements comparable to those of U.S.
entities. A Portfolio could encounter difficulties in obtaining or enforcing a
judgment against the issuer in certain foreign countries. Such risks may be
magnified with respect to securities of issuers in frontier emerging markets. In
addition, certain foreign investments may be subject to foreign withholding or
other taxes, although the Portfolio will seek to minimize such withholding taxes
whenever practical. Investors may be able to deduct such taxes in computing
their taxable income or to use such amounts as credits (subject to a holding
period and certain other restrictions) against their U.S. income taxes if more
than 50% of the Portfolio’s total assets at the close of any taxable year
consist of stock or securities of foreign corporations. Ownership of unsponsored
Depositary Receipts may not entitle the Portfolio to financial or other reports
from the issuer to which it would be entitled as the owner of sponsored
Depositary Receipts. See also “Shareholder Information—Tax Considerations”
below.
Emerging and
Frontier Market Securities. The risks of investing in foreign securities may be intensified in the
case of investments in issuers domiciled or doing substantial business in
developing countries with limited or immature capital markets. Security prices
and currency valuations in emerging and frontier markets can be significantly
more volatile than in the more established markets of the developed nations,
reflecting the greater uncertainties of investing in less mature markets and
economies. In particular, developing countries may have relatively unstable
governments, present the risk of sudden adverse government action and even
nationalization of businesses, restrictions on foreign ownership, or
prohibitions of repatriation of assets, and may have less protection of property
rights than more developed countries. The economies of
developing countries may be
predominantly based on only a few industries, may be highly vulnerable to
changes in local or global trade conditions and may suffer from extreme debt
burdens or volatile inflation rates. Local securities markets may trade a small
number of securities and may be unable to respond effectively to increases in
trading volume, potentially making prompt liquidation of substantial holdings
difficult or impossible at times. Transaction settlement and dividend collection
procedures may be less reliable than in developed markets. Securities of issuers
located in developing countries may have limited marketability and may be
subject to more abrupt or erratic price movements.
Geopolitical
Risk. The value of
your investment in the Portfolios is based on the market prices of the
securities the Portfolios hold. These prices change daily due to economic and
other events that affect markets generally, as well as those that affect
particular regions, countries, industries, companies or governments. These price
movements, sometimes called volatility, may be greater or less depending on the
types of securities a Portfolio owns and the markets in which the securities
trade. The interconnectivity between global economies and financial markets
increases the likelihood that events or conditions in one region or financial
market may adversely impact issuers in a different country, region or financial
market. Securities in a Portfolio may decline in value due to inflation (or
expectations for inflation), interest rates, global demand for particular
products or resources, natural disasters, wars, terrorism, regulatory events and
governmental or quasi-governmental actions. Further, the recent rise of
nationalist economic policies, including trade protectionism, may have a
negative impact on the Portfolios’ performance. It is difficult to predict when
similar events or policies may affect the U.S. or global financial markets or
the effects that such events or policies may have. Any such events or policies
could have a significant adverse impact on the value and risk profile of a
Portfolio.
Geographic
Risk. Concentration
of the investments of a Portfolio in issuers located in a particular country or
region will subject such Portfolio, to a greater extent than if investments were
less concentrated, to the risks of volatile economic cycles and/or conditions,
and developments that may be particular to that country or region, such as:
adverse securities markets; adverse exchange rates; social, political,
regulatory, economic or environmental developments; or natural disasters.
Small- and
Mid-Capitalization Companies. Investment in smaller and
medium-sized companies involves greater risk than investment in larger, more
established companies. Their common stock and other securities may trade less
frequently and in limited volume. Accordingly, the prices of such securities are
generally more sensitive to purchase and sale transactions and tend to be more
volatile than the prices of securities of companies with larger market
capitalizations. Because of this, if a Portfolio wishes to sell a large quantity
of a small or medium-sized company’s shares, it may have to sell at a lower
price than it believes is reflective of the value of the shares, or it may have
to sell in smaller quantities
than desired and over a period of
time. These companies may face greater business risks because they lack the
management depth or experience, financial resources, product diversification, or
competitive strengths of larger companies, and they may be more adversely
affected by poor economic conditions. There may be less publicly-available
information about smaller companies than larger companies. Small company stocks,
as a group, tend to go in and out of favor based on economic conditions and
market sentiment, and during certain periods will perform poorly relative to
other types of investments, including larger company stocks. Generally, the
smaller the company size, the greater these risks become.
Greater China
Risk. Investing in
Greater China involves a higher degree of risk than other regions and economies.
The economy, industries, and securities and currency markets of Greater China
are particularly vulnerable to the region’s dependence on exports and
international trade and increasing competition from Asia’s other low-cost
emerging economies. The imposition of tariffs or other trade barriers by the
U.S. or foreign governments on Mainland China exports and other restrictions on
or barriers to investment in China may adversely impact Chinese issuers.
Currency fluctuations, currency convertibility, interest rate fluctuations and
higher rates of inflation as a result of internal social unrest or conflicts
with other countries may have negative effects on the economies and securities
markets of Greater China. The government of the People’s Republic of China
(“PRC”) exercises significant control over the economy in Mainland China and may
at any time alter or discontinue economic reforms. Investments in Greater China
are subject to the risk of confiscatory taxation, nationalization or
expropriation of assets, potentially frequent changes in the law, and imperfect
information because companies in the China region may not be subject to the same
disclosure, accounting, auditing and financial reporting standards and practices
as U.S. companies. The occurrence of catastrophic events (such as hurricanes,
earthquakes, pandemic disease, acts of terrorism and other catastrophes) in
Greater China could also have a negative impact on a Portfolio.
Investing in certain China-related
securities, such as Chinese A-shares listed and traded on the Shanghai Stock
Exchange and the Shenzhen Stock Exchange through the Hong Kong—Shanghai Stock
Connect and Hong Kong—Shenzhen Stock Connect programs, has certain associated
risks including a lack of certainty regarding how PRC securities regulations and
listing rules of the Shanghai and Shenzhen Stock Exchanges will be applied;
underdeveloped concepts of beneficial ownership and associated rights (i.e.,
participation in corporate actions and shareholder meetings); limitations on the
ability to pursue claims against the issuer; and untested PRC trading, clearance
and settlement procedures. Companies in China may also create variable interest
entities (“VIEs”), special purpose vehicles established offshore to obtain
indirect financing due to Chinese regulations that restrict direct offshore
investing. A Portfolio invested in a VIE may be exposed to certain associated
risks, including that the PRC government outlaws the structure, with uncertain
impact
to existing investors in the VIE;
that the contracts underlying the VIE structure may not be enforced by Chinese
courts; and that shareholders of the domestic Chinese company leverage the VIE
structure to their benefit and to the detriment of the offshore investor.
Taiwan and Hong Kong do not exercise
the same level of control over their economies as does the PRC with respect to
Mainland China, but changes to their political and economic relationships with
the PRC could adversely impact a Portfolio’s investments in Taiwan and Hong
Kong.
Participation
Notes. Participation notes are issued by banks, or broker-dealers, or
their affiliates and are designed to replicate the return of a particular
underlying equity or debt security, currency, or market. When the participation
note matures, the issuer of the participation note will pay to, or receive from,
a Portfolio the difference between the nominal value of the underlying
instrument at the time of purchase and that instrument’s value at maturity.
Participation notes involve the same risks associated with a direct investment
in the underlying security, currency, or market that they seek to replicate. A
Portfolio has no rights under participation notes against the issuer(s) of the
underlying security(ies) and must rely on the creditworthiness of the issuer(s)
of the participation notes. In general, the opportunity to sell participation
notes to a third party will be limited or nonexistent.
Additional information regarding the
risks and special considerations associated with derivatives appears in the
Statement of Additional Information (“SAI”), which may be obtained by following
the instructions at the back of this Prospectus.
NAV
Risk. The net
asset value of a Portfolio and the value of your investment will fluctuate.
Financials Sector
Risk. To the
extent a Portfolio invests in securities and other obligations of issuers in the
financials sector, the Portfolio will be vulnerable to events affecting
companies in the financials industry. Examples of risks affecting the financials
sector include changes in governmental regulation, issues relating to the
availability and cost of capital, changes in interest rates and/or monetary
policy, and price competition. In addition, financials companies are often more
highly leveraged than other companies, making them inherently riskier.
Concentration
Risk. The
Frontier Emerging Markets Portfolio may invest up to 35% of its total assets in
the securities of companies in any one industry if, at the time of investment,
that industry represents 20% or more of the Portfolio’s benchmark index,
currently the MSCI Frontier Emerging Markets Index. At any time the Portfolio
has such a concentration of investments in a single industry group, it will be
particularly vulnerable to adverse economic, political, and other factors that
affect that industry group. Investment opportunities in many frontier emerging
market countries may be concentrated in the banking industry. In many frontier
emerging markets, banks are among the largest publicly-traded
companies and their securities are
among the most widely traded. The banking industry is a comparatively narrow
segment of the economy generally, including in frontier emerging market
countries and, therefore, the Portfolio may experience greater volatility than
portfolios investing in a less-concentrated fashion or a broader range of
industries. Issuers in the banking industry may be subject to additional risks
such as increased competition within the industry, or changes in legislation, or
government regulations affecting the industry. The value of the Portfolio’s
shares may be particularly vulnerable to factors affecting the banking industry,
such as the availability and cost of capital funds, changes in interest rates,
the rate of corporate and consumer debt defaults, extensive government
regulation, and price competition. Such risks may be magnified with respect to
securities of issuers in frontier emerging markets. Please refer to the
Portfolio’s SAI for further information relating to concentration.
Investment Style
Risk.
Different investment styles (e.g., “growth” or “value”) tend to shift in and
out of favor depending upon market and economic conditions as well as investor
sentiment. One style will underperform other styles over certain periods when
that style is out of favor or does not respond as positively to market or other
events. The Portfolios may outperform or underperform other funds that invest in
similar asset classes but employ different investment styles. There may be
market and economic conditions under which an investment philosophy emphasizing
high business quality and earnings growth, as is applied to the Portfolios, will
underperform other investment styles. At times, the market may place a greater
emphasis on current dividends or to discount prospective returns on capital
investment for future growth, which would tend to favor a value style of
investing.
Management
Risk. A
strategy used by Harding Loevner may fail to produce the intended results.
Debt Security
Risk. Debt
securities may lose value due to unfavorable fluctuations in the level of
interest rates or due to a decline in the creditworthiness of the issuer. As
interest rates rise, the value of debt securities generally declines. This risk
is generally greater for debt securities with longer maturities than for debt
securities with shorter maturities.
Credit
Quality. The
value of an individual security or particular type of security can be more
volatile than the market as a whole and can behave differently from the value of
the market as a whole. Lower-quality debt securities (those of less than
investment-grade quality) and certain other types of securities involve greater
risk of default or price changes due to changes in the credit quality of the
issuer. The value of lower-quality debt securities and certain other types of
securities can be more volatile due to increased sensitivity to adverse issuer,
political, regulatory, market or economic developments, and such securities
might be difficult to resell.
Counterparty (or
Default) Risk. An issuer of fixed-income securities held by a Portfolio or a
counterparty to
a derivative transaction entered
into by a Portfolio may default on its obligation to pay interest and repay
principal. Generally, the lower the credit rating of a security, the greater the
risk that the issuer of the security will default on its obligation.
High-quality securities are generally believed to have relatively low degrees of
credit risk. The Portfolios intend to enter into financial transactions only
with counterparties that are creditworthy at the time of the transactions. There
is always the risk that the analysis of creditworthiness is incorrect or may
change due to market conditions. To the extent that a Portfolio focuses its
transactions with a limited number of counterparties, it will be more
susceptible to the risks associated with one or more counterparties.
Illiquid and
Restricted Securities. Each Portfolio may invest up to 15% of the value of its net assets in
illiquid securities. Illiquid securities are securities that may not be sold or
disposed of in the ordinary course of business within seven days at
approximately the value at which a Portfolio has valued the investments and
include securities with legal or contractual restrictions on resale, time
deposits, repurchase agreements having maturities longer than seven days and
securities that do not have readily available market quotations. In addition, a
Portfolio may invest in securities that are sold in private placement
transactions between their issuers and their purchasers and that are neither
listed on an exchange nor traded over-the-counter. These factors may have an
adverse effect on the Portfolio’s ability to dispose of particular securities
and may limit a Portfolio’s ability to obtain accurate market quotations for
purposes of valuing securities and calculating net asset value and to sell
securities at fair value. If any privately placed securities held by a Portfolio
are required to be registered under the securities laws of one or more
jurisdictions before being resold, the Portfolio may be required to bear the
expenses of registration.
High Yield/High
Risk Securities. The Portfolios may invest in debt and convertible securities rated
lower than Baa by Moody’s or BBB by S&P, or unrated securities of equivalent
quality (commonly referred to as “junk bonds”) as determined by Harding Loevner.
Junk bonds typically involve greater risk and are less liquid than higher grade
debt securities. The lower the ratings of such debt securities, the greater
their risks render them like equity securities. None of the Portfolios may
invest in securities rated, at the time of investment, C or below by Moody’s, or
D or below by S&P, or the equivalent as determined by Harding Loevner, which
may be in default with respect to payment of principal or interest.
Derivatives and
Hedging. The
Portfolios may use derivative instruments, including without limitation,
options, futures, participation notes, options on futures, forwards, swaps,
structured securities, and derivatives relating to foreign currency transactions
(collectively, “derivatives”), for hedging purposes and to increase overall
return for the Portfolios. The use of derivatives involves special risks,
including possible default by the other party to the transaction, illiquidity
and, to the extent a Portfolio’s orientation as to certain anticipated
market movements is incorrect, the
possibility that the use of derivatives could result in greater losses than if
they had not been used.
Options and
Futures. The
Portfolios may purchase or sell options. The sale of put and call options could
result in losses to a Portfolio, force the purchase or sale of portfolio
securities at inopportune times, or for prices higher or lower than current
market values, or cause the Portfolio to hold a security it might otherwise
sell. The purchase of options involves costs associated with the option premium
and, if the option is exercised, risks associated with the settlement and the
creditworthiness of the party selling the option. The use of options and futures
transactions entails certain special risks. In particular, the variable degree
of correlation between price movements of futures contracts and price movements
in the related portfolio position of a Portfolio could create the possibility
that losses on the derivative will be greater than gains in the value of the
Portfolio’s position. The loss from investing in futures transactions that are
unhedged or uncovered is potentially unlimited. In addition, futures and options
markets could be illiquid in some circumstances and certain over-the-counter
options could have no markets. A Portfolio might not be able to close out
certain positions without incurring substantial losses. To the extent a
Portfolio utilizes futures and options transactions for hedging, such
transactions should tend to reduce the risk of loss due to a decline in the
value of the hedged position and, at the same time, limit any potential gain to
the Portfolio that might result from an increase in value of the position.
Finally, the daily variation margin requirements for futures contracts create a
greater ongoing potential financial risk than would the purchase of options, in
which case the exposure is limited to the cost of the initial premium and
transaction costs.
DISCLOSURE OF PORTFOLIO HOLDINGS
A description of the Fund’s policies
and procedures regarding disclosure of each Portfolio’s portfolio securities is
available in the SAI. Portfolio holdings information as of each calendar quarter
end is available to shareholders on the Fund’s website. This information is
available no sooner than five (5) business days after the applicable
calendar quarter end. Certain other additional information about the Fund’s
Portfolios is available publicly on the website for AMG Funds, www.amgfunds.com.
MANAGEMENT OF THE FUND
INVESTMENT ADVISER
Harding Loevner serves as investment
adviser to the Fund’s Portfolios. Harding Loevner, established in 1989, is a
registered investment adviser that provides global investment management for
private investors and institutions. As of December 31, 2019, Harding
Loevner managed approximately $73 billion in assets. Harding Loevner is
located at 400 Crossing Boulevard, Fourth Floor, Bridgewater, New Jersey 08807.
Subject to the direction and
authority of the Board of Directors, Harding Loevner provides investment
advisory services to each Portfolio pursuant to investment advisory agreements
(the “Investment Advisory Agreements”). Under the Investment Advisory
Agreements, Harding Loevner is responsible for providing investment research and
advice, determining which portfolio securities shall be purchased or sold by
each Portfolio, purchasing and selling securities on behalf of the Portfolios,
and determining how voting and other rights with respect to the portfolio
securities of the Portfolios are exercised in accordance with each Portfolio’s
investment objective, policies, and restrictions. Harding Loevner also provides
office space, equipment, and personnel necessary to manage the Portfolios.
Harding Loevner bears the expense of providing the above services to each
Portfolio.
The aggregate annualized advisory
fees paid by each Portfolio, excluding any applicable waivers or reimbursements,
to Harding Loevner during the fiscal year ended October 31, 2019 as a
percentage of each Portfolio’s average daily net assets were:
|
|
|
|
|
Portfolio |
|
Aggregate Advisory Fees |
|
|
|
Global
Equity |
|
|
0.80 |
% |
|
|
International Equity |
|
|
0.67 |
% |
|
|
International Small Companies |
|
|
1.15 |
% |
|
|
Emerging
Markets |
|
|
1.12 |
% |
|
|
Frontier
Emerging Markets |
|
|
1.35 |
% |
Harding Loevner may make payments
from its own resources to parties that provide distribution, recordkeeping,
shareholder communication, and other services under mutual fund supermarket and
other programs. See also “Distribution of Fund Shares” below.
ADVISORY CONTRACT APPROVAL
A discussion of the basis for the
Board of Directors’ approval of the Investment Advisory Agreement for the
Portfolios is available in the Fund’s annual report to shareholders for the
period ended October 31, 2019.
PORTFOLIO MANAGEMENT
Peter Baughan, CFA has been a
co-lead portfolio manager since 2003 and an analyst since 1997. As an analyst,
he focuses on consumer discretionary and industrials companies. Mr. Baughan
graduated from the University of North Carolina, Chapel Hill in 1983 and joined
Harding Loevner in 1997. Mr. Baughan serves as a co-lead portfolio manager
for the Global Equity Portfolio.
Pradipta Chakrabortty has been a
portfolio manager and an analyst since 2008. As an analyst, he focuses on
frontier emerging market companies. Mr. Chakrabortty graduated from BIRLA
Institute of Technology & Science (Pilani, India) in 1994, received an
MBA in Finance and Marketing from XLRI School of Management (Jamshedpur, India)
in 1998, and received an MBA in Finance from University of Pennsylvania, the
Wharton School, in 2008. He joined Harding Loevner in 2008.
Mr. Chakrabortty serves as a co-lead portfolio manager for the Frontier
Emerging Markets Portfolio and as a portfolio manager for the Institutional
Emerging Markets Portfolio and Emerging Markets Portfolio.
Scott Crawshaw has been a portfolio
manager since 2014 and an analyst since 2015. As an analyst, he focuses on
emerging markets companies. Mr. Crawshaw graduated from University of
Bristol in 1995. From 2004 to 2014, Mr. Crawshaw was a senior portfolio
manager and research analyst for Russell Investments. He joined Harding Loevner
in 2014. Mr. Crawshaw serves as a co-lead portfolio manager for the
Institutional Emerging Markets Portfolio and Emerging Markets Portfolio and a
portfolio manager for the Global Equity Portfolio.
G. Rusty Johnson, CFA has been a
portfolio manager since 1998, and an analyst since 1994. As an analyst, he
focuses on emerging markets companies. He graduated from Washington and Lee
University in 1986. He also studied at Fu Jen University in Taiwan and Chinese
University in Hong Kong. Mr. Johnson joined Harding Loevner in 1994.
Mr. Johnson serves as a portfolio manager for the Institutional Emerging
Markets Portfolio and Emerging Markets Portfolio.
Jingyi Li has been a portfolio
manager since 2019 and an analyst since 2010. As an analyst, he focuses on
industrials, utilities, and Chinese companies. Mr. Li graduated from
Shanghai Jiaotong University in 1998 and received an MBA from the Yale School of
Management in 2005. He joined Harding Loevner in 2010. Mr. Li serves as a
portfolio manager for the Global Equity Portfolio.
Bryan Lloyd, CFA has been a
portfolio manager since 2014 and an analyst since 2011 when he joined Harding
Loevner. As an analyst, he focuses on financials companies. Mr. Lloyd
graduated from Lafayette College in 1996. Mr. Lloyd serves as a portfolio
manager for the International Equity Portfolio.
Christopher Mack, CFA has been a
portfolio manager since 2014 and an analyst since 2008. As an analyst, he
focuses on information technology companies. Mr. Mack
graduated from Lafayette College in
2004 and joined Harding Loevner that same year. Mr. Mack serves as a
portfolio manager for the Global Equity Portfolio.
Babatunde Ojo, CFA has been a
portfolio manager since 2014 and an analyst since 2012. As an analyst, he
focuses on frontier emerging markets companies. Mr. Ojo graduated from
University of Lagos in 2002. He received an MBA in Finance and Management from
University of Pennsylvania, the Wharton School, in 2012 and joined Harding
Loevner that same year. Mr. Ojo serves as a co-lead portfolio manager for
the Frontier Emerging Markets Portfolio.
Jafar Rizvi, CFA has been a
portfolio manager since 2011 and an analyst since 2008. As an analyst, he
focuses on communication services, consumer discretionary, and international
small companies. Mr. Rizvi graduated from Aligarh University in 1988 and
from J Nehru University in 1990. He received an MBA from Baruch College, The
City University of New York in 1998 and an MPA from Columbia University’s School
of International & Public Affairs in 2010. He joined Harding Loevner in
2008. Mr. Rizvi serves as a co-lead portfolio manager for the International
Small Companies Portfolio.
Ferrill Roll, CFA has been a co-lead
portfolio manager since 2001 an analyst since 1996, and the Co-Chief Investment
Officer since 2016. As an analyst, he focuses on financials companies.
Mr. Roll graduated from Stanford University in 1980 and joined Harding
Loevner in 1996. Mr. Roll serves as a co-lead portfolio manager for the
Global Equity Portfolio and International Equity Portfolio.
Richard Schmidt, CFA has been a
portfolio manager and analyst since 2011. As an analyst, he focuses on consumer
staples companies. Mr. Schmidt graduated from Georgetown University in
1986. He joined Harding Loevner in 2011. Mr. Schmidt serves as a portfolio
manager for the Global Equity Portfolio, Institutional Emerging Markets
Portfolio, and Emerging Markets Portfolio.
Craig Shaw, CFA has been a portfolio
manager since 2006 and an analyst since 2001. As an analyst, he focuses on
energy companies. Mr. Shaw graduated from Concordia College in 1986, and
received an MIM in International Management from Thunderbird/Garvin School of
International Management in 1989. He joined Harding Loevner in 2001.
Mr. Shaw serves as a co-lead portfolio manager for the Institutional
Emerging Markets Portfolio and Emerging Markets Portfolio.
Patrick Todd, CFA has been a
portfolio manager since 2017 and an analyst since 2012 when he joined Harding
Loevner. As an analyst, he focuses on health care and real estate companies.
Mr. Todd graduated from Harvard University in 2002 and received an MBA in
Applied Value Investing from Columbia Business School in 2011. Mr. Todd
serves as a portfolio manager for the International Equity Portfolio.
Anix Vyas, CFA has been a portfolio
manager since 2018 and an analyst since 2013. As an analyst, he focuses on
industrials and materials companies. Mr. Vyas graduated from Fordham
University in 2002 and received an MBA in Finance from University of
Pennsylvania, the Wharton School, in 2010. He joined Harding Loevner in 2013.
Mr. Vyas serves as a co-lead portfolio manager for the International Small
Companies Portfolio.
Andrew West, CFA has been a
portfolio manager since 2014 and an analyst since 2006. From 2011 to 2019, he
also served as Manager of Investment Research. As an analyst, he focuses on
consumer discretionary and industrials companies. Mr. West graduated from
the University of Central Florida in 1991 and received an MBA in Finance and
International Business from New York University, Leonard N. Stern School of
Business, in 2003. He joined Harding Loevner in 2006. Mr. West serves as a
co-lead portfolio manager for the International Equity Portfolio and a portfolio
manager for the Global Equity Research Portfolio, International Equity Research
Portfolio, and Emerging Markets Research Portfolio.
In providing services to the Fund,
Harding Loevner may use portfolio management and research resources of a foreign
(non-U.S.) affiliate that is not registered under the Investment Advisers Act of
1940, as amended, and may provide services to the Fund through a “participating
affiliate” arrangement, as that term is used in relief granted by the staff of
the Securities and Exchange Commission allowing U.S. registered investment
advisers to use portfolio management or research resources of advisory
affiliates subject to the regulatory supervision of the registered investment
adviser.
Additional information regarding the
portfolio managers’ compensation, their management of other funds and their
ownership of the Fund can be found in the SAI.
PORTFOLIO EXPENSES
Each Portfolio pays for all of its
expenses out of its own assets. Harding Loevner or other service providers may
waive all or any portion of their fees and reimburse certain expenses to each
Portfolio. Any fee waiver or expense reimbursement would increase the investment
performance of each Portfolio for the period during which the waiver or
reimbursement is in effect.
SHAREHOLDER INFORMATION
DETERMINATION OF NET ASSET VALUE
The “net asset value” per share
(“NAV”) of the Portfolios is calculated as of the close of business (normally
4:00 p.m. New York Time) on days when the New York Stock Exchange is
open for business, except when trading is restricted (a “Business Day”). Each
Class or Portfolio determines its NAV per share by subtracting that
Class or Portfolio’s liabilities (including accrued expenses and dividends
payable) from the total value of the Portfolio’s investments or the portion of a
Portfolio’s investments attributable to a Class and other assets and
dividing the result by the total issued and outstanding shares of the
Class or Portfolio. Because the Portfolios may invest in foreign securities
that are primarily listed on foreign exchanges that may trade on weekends or
other days when the Portfolios do not price their shares, the value of the
Portfolios’ assets may be affected on days when shareholders will not be able to
purchase or redeem the Portfolios’ shares.
Each Portfolio’s investments are
valued based on market quotations, or if market quotations are not readily
available or are deemed unreliable, the fair value of the Portfolio’s
investments may be determined in good faith under procedures established by the
Board of Directors as discussed below.
Fair
Valuation. Since trading in many foreign securities is normally completed
before the time at which a Portfolio calculates its NAV, the effect on the value
of such securities held by a Portfolio of events that occur between the close of
trading in the security and the time at which the Portfolio prices its
securities would not be reflected in the Portfolio’s calculation of its NAV if
foreign securities were generally valued at their closing prices.
To address this issue, the Board of
Directors has approved the daily use of independently provided quantitative
models that may adjust the closing prices of certain foreign equity securities
based on information that becomes available after the foreign market closes,
through the application of an adjustment factor to such securities’ closing
prices. Adjustment factors may be greater than, less than, or equal to 1. Thus,
use of these quantitative models could cause the Portfolio’s NAV per share to
differ significantly from that which would have been calculated using closing
market prices. The use of these quantitative models is also intended to decrease
the opportunities for persons to engage in “time zone arbitrage,” i.e., trading
intended to take advantage of stale closing prices in foreign markets that could
affect the NAV of the Portfolios.
Additionally, any securities for
which market quotations are not readily available, such as when a foreign market
is closed, or for which available prices are deemed unreliable, are priced by
Harding Loevner at “fair value as determined in good faith” in accordance with
procedures established by and under the general supervision of the Board of
Directors.
PURCHASE AND REDEMPTION OF SHARES
Purchases. The minimum initial investment in the Investor Class of the
International Equity Portfolio, the International Small Companies Portfolio, and
the Frontier Emerging Markets Portfolio, and the Advisor Class of the
Global Equity Portfolio and the Emerging Markets Portfolio of the Fund is
$5,000. Additional purchases or redemptions may be of any amount. Individuals
may satisfy the minimum investment by aggregating their fiduciary accounts. The
Fund reserves the right to waive the minimum initial investment amount for any
Portfolio.
The Fund has authorized one or more
brokers to receive purchase orders on its behalf. Such brokers are authorized to
designate other intermediaries to accept purchase orders on the Fund’s behalf.
The Fund will be deemed to have received a purchase order when an authorized
broker or, if applicable, a broker’s authorized agent receives the order in
proper form. Share purchase orders placed through an authorized broker or the
broker’s authorized designee will be priced at the NAV per share next determined
after they are received in proper form by an authorized broker or the broker’s
authorized designee and accepted by the Fund. With respect to purchases of
Portfolio shares through certain brokers: (1) a broker may charge
transaction fees, brokerage commissions, or other different, or additional fees;
(2) duplicate mailings of Fund material to shareholders who reside at the
same address may be eliminated; and (3) the minimum initial investment
through certain brokers may be less than a direct purchase with the Fund.
The offering of shares of a
Portfolio is continuous and purchases of shares of a Portfolio may be made on
any Business Day. The Fund offers shares of each Portfolio at a public offering
price equal to the NAV per share next determined after receipt of a purchase
order.
You may be required to pay a
commission directly to a broker or financial intermediary for effecting
transactions in Advisor Class shares of the Portfolios.
Shares of the Emerging Markets
Portfolio may not be available for purchase by all investors.
Generally, shares will be available
for purchase by new and existing shareholders, including investors who purchase
shares directly from the Portfolio or through financial intermediaries, and by
participants in retirement or employee benefit plans. However, the Fund
reserves the right to: (1) limit an investor’s ability to purchase shares
through certain financial intermediaries; (2) limit the ability of
financial intermediaries to acquire shares on behalf of their customers; and
(3) prohibit any financial intermediary from increasing the allocation to
the Emerging Markets Portfolio in model portfolios. In each case, the Fund
will consider whether additional purchases are expected to negatively impact the
Portfolio or its shareholders as a whole.
The investment strategies used by
Harding Loevner to manage the Funds have capacity limitations. In circumstances
where the amount of total exposure to a strategy or investment type for a Fund
is, in the opinion of Harding Loevner, capacity constrained, Harding Loevner, in
consultation with the Board, reserves the right to close the Fund to new
investors and/or impose restrictions on new investments in the Fund.
If you are purchasing shares of the
Emerging Markets Portfolio through a financial intermediary, please consult with
an appropriate representative to confirm your eligibility to invest in the
Portfolio.
Investors may be required to
demonstrate eligibility to buy shares of the Portfolio before an investment is
accepted.
The Fund and Harding Loevner may
make exceptions or otherwise modify this policy at any time. For questions
about qualifying to purchase shares of the Portfolio, please call
(877) 435-8105.
You may purchase shares of a
Portfolio utilizing the following methods:
Wire
Transfer: Purchases
of shares may be made by wire transfer of Federal funds. Share purchase orders
are effective on the date when the Transfer Agent receives a completed Account
Application Form (and other required documents) and Federal funds become
available to the Fund in the Fund’s account with the Transfer Agent as set forth
below. The shareholder’s bank may impose a charge to execute the wire transfer.
Please call the Transfer Agent at (877) 435-8105 for instructions and
policies on purchasing shares by wire.
In order to purchase shares on a
particular Business Day, a purchaser must call the Transfer Agent as soon as
possible, but no later than by the close of business (normally 4:00 p.m. New
York Time), to inform the Fund of the incoming wire transfer and clearly
indicate the name of the Portfolio and which class of shares is to be purchased.
If Federal funds are received by the Fund that same day, the order will be
effective on that day. If the Fund receives trade instructions after the
above-mentioned cut-off time, or if the Transfer Agent does not receive Federal
funds, such purchase order shall be executed as of the date that Federal funds
are received. Portfolio shares are normally issued upon receipt of payment by
cash, check, or wire transfer.
Check: A check used to purchase shares in a Portfolio must be payable to
the Portfolio in which you wish to purchase shares, and must be drawn against
funds on deposit at a U.S. bank. For a new account, the order must include a
completed Account Application Form (and other required documents, if any). For
an existing account, the order should include the account number from your
statement. In all cases, the purchase price is based on the NAV per share next
determined after the purchase order and check are received and deposited in good
order. The Fund or the Transfer Agent reserves
the right to reject any check. All
checks for share purchases should be sent to the Fund’s Transfer Agent at:
Regular Mail:
Harding, Loevner Funds, Inc.
c/o The Northern Trust Company
P.O. Box 4766
Chicago, Illinois 60680-4766
Overnight Delivery:
The Northern Trust Company
Attn: Harding, Loevner Funds,
Inc.
333 South Wabash Avenue
Attn: Funds Center, Floor 38
Chicago, Illinois 60604
The Fund reserves the right in its
sole discretion: (i) to suspend or modify the offering of a Portfolio’s
shares, (ii) to reject purchase orders, and (iii) to modify or
eliminate the minimum initial investment in Portfolio shares. Purchase orders
may be refused if, for example, they are of a size that could disrupt management
of a Portfolio.
Please note that in compliance with
the USA Patriot Act of 2001, the Fund’s Transfer Agent will verify certain
information on your account application as part of the Fund’s anti-money
laundering compliance program. If you do not supply the necessary information,
the Fund’s Transfer Agent may not be able to open your account. Additionally, if
the Fund’s Transfer Agent is unable to verify your identity or that of another
person authorized to act on your behalf, or if it believes it has identified
potentially criminal activity, the Fund reserves the right to close your account
or take any other action it deems reasonable or required by law.
Redemptions. Upon the request of a shareholder, the Fund will redeem all or any part
of the shares held through the account. The redemption price is the NAV per
share next determined after receipt by the Transfer Agent of proper notice of
redemption as described below. If the Transfer Agent receives such notice by the
close of business (normally 4:00 p.m. New York Time) on any Business Day, the
redemption will be effective on the date of receipt.
Payment of redemption proceeds made
by check or wire will normally be made within one to three Business Days
following receipt of the redemption request, or at other times in accordance
with the requirements of your intermediary.
For Shares held directly with the
Fund, payment of redemption proceeds by wire will normally be made on the next
Business Day following receipt of the redemption order. For payment by check,
the Portfolios typically expect to mail the check on the next Business Day
following receipt of the redemption order.
For Shares held through financial
intermediaries, the length of time that the Portfolios typically expect to pay
redemption proceeds depends on the
method of payment and the agreement between the financial intermediary and the
Portfolio. For redemption proceeds that are paid directly to you by a Portfolio,
the Portfolio typically expects to make payments by wire or by mailing a check
on the next Business Day following the Portfolio’s receipt of a redemption order
from the financial intermediary. For payments that are made to your financial
intermediary for transmittal to you, the Portfolios expect to pay redemption
proceeds to the financial intermediary within one to three Business Days
following the Portfolio’s receipt of the redemption order from the financial
intermediary.
Payment of redemption proceeds may
take longer than the time a Portfolio typically expects and may take up to seven
days, as permitted by the 1940 Act.
For redemption orders that settle on
federal bank holidays, your redemption proceeds will be sent on the next
Business Day following the holiday.
If you are redeeming shares recently
purchased by check or electronic transaction, your redemption may not be paid
until your check or electronic transaction has cleared. This may delay your
payment for up to 10 days. If the notice is received on a day that is not a
Business Day or after the above-mentioned cut-off time, the redemption notice
will be deemed received as of the next Business Day.
The Fund has authorized one or more
brokers to receive redemption orders on its behalf. Such brokers are authorized
to designate other intermediaries to receive redemption orders on the Fund’s
behalf. The Fund will be deemed to have received a redemption order when an
authorized broker or, if applicable, a broker’s authorized agent receives the
order in proper form. Share redemption orders placed through an authorized
broker or the broker’s authorized designee will be priced at the Portfolio’s NAV
per share next determined after they are received in good order by an authorized
broker or the broker’s authorized designee.
The Fund imposes no charge to redeem
shares; however, a shareholder’s or broker’s bank may impose its own wire
transfer fee for receipt of a wire. Redemptions may be executed in any amount
requested by the shareholder up to the amount the shareholder has invested in
the Portfolio. When a shareholder’s account balance falls below $5,000 following
a redemption, the Portfolio may close the account. Such shareholders will be
notified that the minimum account balance is not being maintained and will be
allowed 60 days to make additional investments before the account is closed.
To redeem shares, a shareholder or
any authorized agent (so designated on the Account Application Form) must
provide the Transfer Agent with the dollar or share amount to be redeemed, the
account to which the redemption proceeds should be wired (which account shall
have been previously designated by the shareholder on its Account Application
Form), the name of the shareholder, and the shareholder’s account number.
Shares that are redeemed prior to
the record date of a distribution do not receive dividends.
Certain requests or changes must be
made in writing to the Transfer Agent and must include a signature guaranteed by
a national bank that is a member of the Medallion Signature Program, using the
specific Medallion “Guaranteed” stamp. Notarized signatures are not sufficient.
Further documentation may be required when the Transfer Agent deems it
appropriate. Requests or changes must include a Signature Guarantee if a
shareholder:
◾ |
|
wishes to
change its authorized agent; |
◾ |
|
wishes to
redeem shares within 10 Business Days of changing the account address of
record; |
◾ |
|
wishes to
change the account designated to receive redemption proceeds; or
|
◾ |
|
requests
that a check be mailed to a different address than the record address.
|
A shareholder may request redemption
by calling the Transfer Agent (toll-free) at (877) 435-8105. Telephone
redemption privileges are made available to shareholders of the Fund on the
Account Application Form. The Fund or the Transfer Agent employ reasonable
procedures designed to confirm that instructions communicated by telephone are
genuine. The Fund or the Transfer Agent may require personal identification
codes and will only wire funds according to pre-existing bank account
instructions. No bank account instruction changes will be accepted via
telephone.
Generally, all redemptions will be
for cash. Periodically, the Portfolios may satisfy redemption requests by
accessing a line of credit or overdraft facility. On a less regular basis, under
stressed market conditions, as well as for other temporary or emergency
purposes, the Portfolios may satisfy redemption requests by distributing
redemption proceeds in-kind (instead of cash) or by borrowing through other
sources. While the Portfolios do not generally use redemptions in-kind, the Fund
reserves the right to redeem from any Portfolio in-kind to manage the impact of
large redemptions on the Portfolios. Redemption in-kind proceeds will typically
be made by delivering a pro-rata amount of a Portfolio’s holdings that are
readily marketable securities to the redeeming shareholder within seven days
after the Portfolio’s receipt of the redemption order.
Redemption proceeds will only be
paid to the shareholder of record, to a financial intermediary holding an
account in the name of the shareholder of record, or to a court-appointed
guardian or executor of the shareholder of record.
Restrictions on
Frequent Trading. Frequent purchases and sales of a Portfolio’s shares can harm
shareholders in various ways, including reducing the returns to long-term
shareholders by increasing costs (such as brokerage commissions) to the
Portfolio and by disrupting portfolio management strategies. Accordingly, the
Board of Directors has adopted policies and procedures to
discourage frequent trading of
Portfolio shares. The Fund uses fair value pricing of securities to discourage
frequent trading and eliminate the opportunity for time zone arbitrage. While
the Fund is committed to preventing market timing and disruptive frequent
trading in the Portfolios, there is no guarantee that the Fund or its agents
will be able to detect all instances of time zone arbitrage and frequent
trading.
Omnibus accounts are maintained by
intermediaries acting on behalf of multiple shareholders. Since individual
trades in omnibus accounts are not ordinarily disclosed to the Fund, the Fund
may be unable to detect or deter frequent trading by participants in such
omnibus accounts.
Exchange
Privilege. Investor
Class and Advisor Class shares of the Portfolios may be exchanged for
shares of another Portfolio or class of the Fund (excluding Institutional
Class Z) based on the respective NAV of the shares involved in the
exchange, if: (i) the shareholder wishing to exchange shares resides in a
state where the Portfolio and class of shares to be acquired are qualified for
sale; and (ii) the investment meets the minimum initial investment
requirement for the Portfolio and class of shares to be acquired. The following
table includes the minimum initial investment required by each class of each
Portfolio.
|
|
|
|
|
|
|
|
|
|
|
Portfolio |
|
Minimum Initial
Investment (by Class) |
|
|
|
|
|
|
|
|
$5,000 |
|
$100,000 |
|
$500,000 |
|
$10,000,000 |
|
$25,000,000 |
|
|
|
|
|
|
Global
Equity |
|
Advisor Class |
|
Institutional Class† |
|
|
|
|
|
|
|
|
|
|
|
|
International Equity |
|
Investor Class |
|
Institutional Class† |
|
|
|
|
|
|
|
|
|
|
|
|
International Small Companies |
|
Investor Class |
|
Institutional Class† |
|
|
|
|
|
|
|
|
|
|
|
|
Institutional Emerging Markets†‡ |
|
|
|
|
|
Institutional Class†‡
|
|
|
|
|
|
|
|
|
|
|
Emerging
Markets‡ |
|
Advisor Class‡ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Frontier
Emerging Markets |
|
Investor Class |
|
Institutional Class I† |
|
|
|
Institutional Class II† |
|
|
† |
Not
offered in this Prospectus. |
‡ |
Shares of
the Portfolio may not be available for purchase by all investors. For
more information, see the section “Shareholder Information—Purchase and
Redemption of Shares” in the Portfolio’s Prospectus.
|
An exchange order is treated for tax
purposes the same as a redemption (on which a taxable gain or loss may be
realized) followed by a purchase and may be subject to federal income tax.
Investors who wish to make exchanges should telephone the Transfer Agent
(toll-free) at (877) 435-8105.
In addition, a shareholder holding
shares of a Portfolio through fee-based (advisory) programs of certain
intermediaries may decide to transfer such shares to a brokerage (non-advisory)
account of such intermediaries. The shareholder may have these shares exchanged
by their intermediary to a different class of shares of the same Portfolio as a
result of the transfer of the shares to a brokerage account with the
intermediary. Such exchanges will be effected on the basis of the relative NAV
of the two share classes, without the imposition of any fees or other charges by
the relevant Portfolio. The fees and expenses of the new class may be higher
than those of the previously held class. It is expected that the intermediary
will treat the exchange as a non-taxable event. Shareholders should carefully
review information in the applicable Prospectus regarding share class features,
including exchanges, or contact their intermediary for more
information. The relevant share class may be described in a separate
Prospectus for each Portfolio.
Share Class
Conversions. On the
request of shareholders, the Investor Class or Advisor Class shares of
a Portfolio may be converted to Institutional Class or Institutional
Class I shares (which are not offered in this Prospectus) of the same
Portfolio if the account balance of the shareholder requesting conversion is at
least $100,000, at which time the shareholder’s account will be subject to the
requirements of Institutional Class or Institutional Class I shares.
Any such conversion will occur at the relative NAV of the two share classes,
without the imposition of any fees or other charges if the accounts are held
directly with the Fund. A conversion between share classes of the same Portfolio
is generally not a taxable event. Investors who wish to request a conversion
should telephone the Transfer Agent (toll-free) at (877) 435-8105 or their
salesperson.
DIVIDENDS
Each class of the Portfolios will
declare a dividend from its net investment income and distributions from its
realized net short-term and net long-term capital gains, if any, at least
annually, and (unless a shareholder has elected to receive cash) pay such
dividends and distributions by automatically reinvesting in additional shares of
the Portfolio at the NAV per share on the ex-date of the dividends or
distributions.
TAX CONSIDERATIONS
The following discussion is for
general information only. An investor should consult with his or her own tax
adviser as to the tax consequences of an investment in a Portfolio, including
the status of distributions from each Portfolio under applicable state or local
law.
Federal Income
Taxes. Each
Class or Portfolio intends to distribute all of its taxable income by
automatically reinvesting dividends in additional shares of the same
Class or Portfolio and distributing those shares to its shareholders,
unless a shareholder elects on the Account Application Form to receive cash
payments for such distributions. Shareholders receiving distributions from a
Portfolio in the form of additional shares will be treated for federal income
tax purposes as receiving a distribution of the amount of cash that they would
have received had they elected to receive the distribution in cash.
Dividends paid by a Portfolio from
its investment company taxable income (including interest and net short-term
capital gains) will be taxable to a U.S. shareholder as ordinary income, whether
received in cash or in additional shares. Distributions of net capital gains
(the excess of net long-term capital gains over net short-term capital losses)
are generally taxable to shareholders at the applicable capital gains rates,
regardless of how long they have held their shares. If a portion of a
Portfolio’s income consists of qualifying dividends paid by corporations, a
portion of the dividends paid by the Portfolio may be eligible for either the
corporate dividends-received deduction or the lower individual tax rate on
qualified dividends if both the Portfolio and shareholder satisfy applicable
holding period requirements. The maximum individual rate applicable to
“qualified dividend income” and long-term capital gains is currently generally
either 15% or 20%, depending on whether the individual’s income exceeds certain
threshold amounts. An additional 3.8% Medicare tax is imposed on certain net
investment income (including ordinary dividends and capital gain distributions
received from the Portfolio and net gains from redemptions or other taxable
dispositions of Portfolio shares) of U.S. individuals, estates, and trusts to
the extent that such person’s “modified adjusted gross income” (in the case of
an individual) or “adjusted gross income” (in the case of an estate or trust)
exceeds certain threshold amounts.
The sale or exchange of Portfolio
shares is a taxable transaction for federal income tax purposes. Each
shareholder will generally recognize a gain or loss on such transactions equal
to the difference, if any, between the amount of the net sales proceeds and the
shareholder’s tax basis in the Portfolio shares. Such gain or loss will be
capital gain or loss if the shareholder held its Portfolio shares as a capital
asset. Any capital gain or loss will generally be treated either as long-term
capital gain or loss if the shareholder held the Portfolio shares for more than
one year at the time of the sale or exchange, or otherwise as short-term capital
gain or loss.
If a shareholder buys shares of a
Portfolio before a distribution, the shareholder will be subject to tax on the
entire amount of the taxable distribution received. Distributions are taxable to
shareholders even if they are paid from income or gain earned by the Portfolio
before their investment (and thus were included in the price they paid for their
Portfolio shares).
The Portfolios (or their
administrative agents) are required to report to the Internal Revenue Service
and furnish to shareholders the cost basis information for sale transactions of
shares purchased on or after January 1, 2012. Shareholders may elect to
have one of several cost basis methods applied to their account when calculating
the cost basis of shares sold, including average cost, first-in, first-out or
some other specific identification method. Unless you instruct otherwise, the
Portfolios will use average cost as their default cost basis method, and will
treat sales as first coming from shares purchased prior to January 1, 2012.
If average cost is used for the first sale of shares covered by these new rules,
the shareholder may only use an alternative cost method for shares purchased
prospectively. Shareholders should consult with their tax advisors to determine
the best cost basis method for their tax situation. Shareholders that hold their
shares through a financial intermediary should contact such financial
intermediary with respect to reporting of cost basis and available elections for
their accounts.
A distribution will be treated as
paid on December 31 of the current calendar year if it is declared by a
Portfolio in October, November or December with a record date in any such month
and paid by the Portfolio during January of the following calendar year. Such
distributions will be taxable to shareholders in the calendar year in which the
distributions are declared, rather than the calendar year in which the
distributions are received. The Fund will inform shareholders of the amount and
tax status of all amounts treated as distributed to them after the close of each
calendar year.
If more than 50% of the value of a
Portfolio’s total assets at the close of any taxable year consists of securities
of foreign corporations, the Portfolio will be eligible to file an election with
the Internal Revenue Service that would generally enable its shareholders to
benefit from any foreign tax credit or deduction available for any foreign taxes
the Portfolio pays. Pursuant to this election, a shareholder will be required to
include in gross income (in addition to dividends actually received) its pro
rata share of the foreign taxes paid by a Portfolio, and may be entitled either
to deduct its pro rata share of the foreign taxes in computing its taxable
income or to use the amount as a foreign tax credit against its U.S. federal
income tax liability (subject to certain holding period and other requirements).
The consequences of such an election are discussed in more detail in the SAI.
The Portfolios may be required to
withhold U.S. federal income tax at the applicable rate on all distributions
payable to shareholders if they fail to provide the Portfolios with their
correct taxpayer identification number or to make required certifications, or if
they have
been notified by the IRS that they
are subject to backup withholding. Backup withholding is not an additional tax.
Any amounts withheld may be credited against U.S. federal income tax liability.
Foreign shareholders may be subject
to different U.S. federal income tax treatment, including withholding tax at the
rate of 30% on amounts treated as ordinary dividends from the Portfolios, as
discussed in more detail in the SAI.
State and Local
Taxes. A Portfolio
may be subject to state, local, or foreign taxation in any jurisdiction in which
the Portfolio may be deemed to be doing business.
Portfolio distributions may be
subject to state and local taxes. Shareholders should consult their own tax
advisers regarding the particular tax consequences of an investment in a
Portfolio.
The foregoing discussion is only a
brief summary of the important federal tax considerations generally affecting
the Fund and its shareholders. No attempt is made to present a detailed
explanation of the federal, state or, local income tax treatment of the Fund or
its shareholders, and this discussion is not intended as a substitute for
careful tax planning. Accordingly, potential investors should consult their tax
advisers with specific reference to their own tax situation.
SHAREHOLDER COMMUNICATIONS
Inquiries concerning the Fund may be
made by writing to Harding, Loevner Funds, Inc., c/o The Northern Trust Company,
Attn: Funds Center, Floor 38, 333 South Wabash Avenue, Chicago, Illinois
60604 or by calling the Fund (toll-free) at (877) 435-8105.
When the Fund sends financial
reports, prospectuses, and other regulatory materials to shareholders, we
attempt to reduce the volume of mail you receive by sending one copy of these
documents to two or more account holders who share the same address. This will
continue indefinitely, unless you notify us otherwise. Should you wish to
receive individual copies of materials, please call the Transfer Agent at
(877) 435-8105. Once we have received your instructions, you will begin
receiving individual copies for each account at the same address within 30 days.
DISTRIBUTION OF FUND SHARES
Shares of the Fund are distributed
by Quasar Distributors, LLC (“Quasar” or the “Distributor”) pursuant to a
distribution agreement (the “Distribution Agreement”) between Harding Loevner,
the Fund, and Quasar, under which Quasar serves as the exclusive distributor of
the Fund.
The Fund has agreements with various
financial intermediaries under which customers of these intermediaries may
purchase and hold shares of the Portfolios. These intermediaries assess fees in
consideration for providing certain account maintenance, record keeping and
transactional services. In recognition of the savings of expenses to the Fund
arising from the intermediaries’ assumption of non-distribution related
functions that the Fund would otherwise perform, such as providing
sub-accounting and related shareholder services, each Portfolio or
Class (except Institutional Class Z which is not offered in this
Prospectus) is authorized, pursuant to a Shareholder Servicing Plan, to pay to
each intermediary up to 0.25% of its average daily net assets attributable to
that intermediary (subject to any applicable fee waiver and/or expense
reimbursement). Because of the fee waivers and/or expense reimbursements
applicable to the Portfolios during the fiscal year ended October 31, 2019,
Harding Loevner paid a portion of the Portfolios’ share of these fees during
that period.
In addition, Harding Loevner may, at
its own expense and out of its own legitimate profits, provide additional cash
payments to financial intermediaries that distribute shares of the Portfolios or
provide account maintenance, record keeping and transactional services. Harding
Loevner may also share with financial advisors and 529 Plan managers and/or
administrators certain marketing expenses or pay for the opportunity to
distribute the Portfolios, sponsor informational meetings, seminars, client
awareness events, support for marketing materials, or business building
programs. These payments, sometimes referred to as “revenue sharing,” do not
change the price paid by investors to purchase the Fund’s shares or the amount
the Portfolios receive as proceeds from such sales. Such payments may differ as
to amount among financial intermediaries based on various factors, including
levels of assets and/or sales (based on gross or net sales) or some other
criteria. In some circumstances, the payments may relate to the Portfolios’
inclusion on a financial intermediary’s preferred list of funds offered to its
clients and may create an incentive for a broker-dealer, or other financial
intermediary, or its representatives to recommend or offer shares of the
Portfolios to its customers over other funds that do not have sponsors making
similar payments. You may wish to consider whether such arrangements exist when
evaluating any recommendations to purchase or sell shares of the Portfolios. The
Fund may enter into additional similar arrangements in the future. Further
information concerning these arrangements is included in the SAI.
Class Expenses and
Distribution Plan. Investor Class shares are subject to a 12b-1 (Distribution) fee of
up to 0.25% of the average daily net assets attributed to such shares.
The Board of Directors has approved
a Distribution Plan with respect to the Investor Class shares. Under the
Distribution Plan, the Distributor is entitled to receive a fee (as set forth
above), which the Distributor may in turn allocate among and remit to selected
dealers and others (each, an “Agent”) as compensation attributable to the assets
contributed to the applicable Investor Class by shareholders who are
customers of the Agent. Because these fees are paid out of Investor
Class assets on an ongoing basis, over time these fees will increase the
cost of your investment and may cost you more than paying other types of sales
charges, such as front-end loads that may be charged by other funds.
FINANCIAL HIGHLIGHTS
The financial highlights table is
intended to help you understand each Portfolio’s financial performance for the
past five years or since inception, if less than five years. Certain information
reflects financial results for a single share of a Class. The total returns in
the table represent the rate that an investor would have earned or lost on an
investment in a Class or Portfolio (assuming reinvestment of all dividends
and distributions). This information has been derived from the Fund’s financial
statements, which have been audited
by KPMG LLP, an independent registered public accounting firm, whose report,
along with the Fund’s financial statements, is included in the annual report,
which is incorporated by reference in this Prospectus and the SAI. Information
on how to obtain the semi-annual and audited annual reports for the Fund is
found on the back cover of this Prospectus.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GLOBAL
EQUITY PORTFOLIO – ADVISOR CLASS |
|
|
|
|
For the Fiscal Year
Ended Oct. 31, 2019 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2018 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2017 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2016 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2015 |
|
|
|
|
|
|
|
Net
asset value, beginning of year |
|
$ |
35.60 |
|
|
$ |
40.78 |
|
|
$ |
32.47 |
|
|
$ |
32.38 |
|
|
$ |
32.92 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase (Decrease) in Net Assets from Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income (loss)(1) |
|
|
0.03 |
|
|
|
0.07 |
|
|
|
0.01 |
|
|
|
0.05 |
|
|
|
0.04 |
|
|
|
|
|
|
|
Net realized and unrealized gain (loss) on investments and foreign
currency-related transactions |
|
|
3.43 |
|
|
|
(0.15 |
) |
|
|
8.73 |
|
|
|
0.91 |
|
|
|
0.68 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
increase (decrease) from investment operations |
|
|
3.46 |
|
|
|
(0.08 |
) |
|
|
8.74 |
|
|
|
0.96 |
|
|
|
0.72 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions to Shareholders from: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
(0.04 |
) |
|
|
(0.08 |
) |
|
|
(0.04 |
) |
|
|
(0.03 |
) |
|
|
(0.03 |
) |
|
|
|
|
|
|
Net
realized gain from investments |
|
|
(3.72 |
) |
|
|
(5.02 |
) |
|
|
(0.39 |
) |
|
|
(0.84 |
) |
|
|
(1.23 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
distributions |
|
|
(3.76 |
) |
|
|
(5.10 |
) |
|
|
(0.43 |
) |
|
|
(0.87 |
) |
|
|
(1.26 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
asset value, end of year |
|
$ |
35.30 |
|
|
$ |
35.60 |
|
|
$ |
40.78 |
|
|
$ |
32.47 |
|
|
$ |
32.38 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Return |
|
|
11.60% |
|
|
|
(0.57)% |
|
|
|
27.28% |
|
|
|
3.12% |
|
|
|
2.28% |
|
|
|
|
|
|
|
Ratios/Supplemental Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net assets, end of year (000’s) |
|
$ |
48,181 |
|
|
$ |
90,567 |
|
|
$ |
75,244 |
|
|
$ |
56,698 |
|
|
$ |
64,726 |
|
|
|
|
|
|
|
Expenses to average net assets |
|
|
1.12% |
|
|
|
1.14% |
|
|
|
1.14% |
|
|
|
1.19% |
|
|
|
1.18% |
|
|
|
|
|
|
|
Expenses to average net assets (net of fees
waived/reimbursed) |
|
|
1.12% |
|
|
|
1.14% |
|
|
|
1.14% |
|
|
|
1.19% |
|
|
|
1.18% |
|
|
|
|
|
|
|
Net investment income to average net assets |
|
|
0.09% |
|
|
|
0.18% |
|
|
|
0.02% |
|
|
|
0.15% |
|
|
|
0.13% |
|
|
|
|
|
|
|
Portfolio turnover rate |
|
|
39% |
|
|
|
42% |
|
|
|
33% |
|
|
|
24% |
|
|
|
45% |
|
(1) |
Net
investment income per share was calculated using the average shares
outstanding method. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTERNATIONAL EQUITY PORTFOLIO – INVESTOR CLASS |
|
|
|
|
For the Fiscal Year
Ended Oct. 31, 2019 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2018 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2017 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2016 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2015 |
|
|
|
|
|
|
|
Net
asset value, beginning of year |
|
$ |
20.65 |
|
|
$ |
22.55 |
|
|
$ |
18.30 |
|
|
$ |
17.62 |
|
|
$ |
18.23 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase (Decrease) in Net Assets from Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income (loss)(1) |
|
|
0.22 |
|
|
|
0.21 |
|
|
|
0.19 |
|
|
|
0.14 |
|
|
|
0.15 |
|
|
|
|
|
|
|
Net realized and unrealized gain (loss) on investments and foreign
currency-related transactions |
|
|
1.98 |
|
|
|
(1.80 |
) |
|
|
4.18 |
|
|
|
0.66 |
|
|
|
(0.64 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
increase (decrease) from investment operations |
|
|
2.20 |
|
|
|
(1.59 |
) |
|
|
4.37 |
|
|
|
0.80 |
|
|
|
(0.49 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions to Shareholders from: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
(0.19 |
) |
|
|
(0.13 |
) |
|
|
(0.12 |
) |
|
|
(0.12 |
) |
|
|
(0.12 |
) |
|
|
|
|
|
|
Net
realized gain from investments |
|
|
— |
|
|
|
(0.18 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
distributions |
|
|
(0.19 |
) |
|
|
(0.31 |
) |
|
|
(0.12 |
) |
|
|
(0.12 |
) |
|
|
(0.12 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
asset value, end of year |
|
$ |
22.66 |
|
|
$ |
20.65 |
|
|
$ |
22.55 |
|
|
$ |
18.30 |
|
|
$ |
17.62 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Return |
|
|
10.79% |
|
|
|
(7.16)% |
|
|
|
24.04% |
|
|
|
4.63% |
|
|
|
(2.76)% |
|
|
|
|
|
|
|
Ratios/Supplemental Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net assets, end of year (000’s) |
|
$ |
395,339 |
|
|
$ |
411,712 |
|
|
$ |
644,243 |
|
|
$ |
433,765 |
|
|
$ |
405,101 |
|
|
|
|
|
|
|
Expenses to average net assets |
|
|
1.13% |
|
|
|
1.14% |
|
|
|
1.14% |
|
|
|
1.15% |
|
|
|
1.17% |
|
|
|
|
|
|
|
Expenses to average net assets (net of fees
waived/reimbursed) |
|
|
1.13% |
|
|
|
1.14% |
|
|
|
1.14% |
|
|
|
1.15% |
|
|
|
1.17% |
|
|
|
|
|
|
|
Net investment income to average net assets |
|
|
1.03% |
|
|
|
0.92% |
|
|
|
0.95% |
|
|
|
0.83% |
|
|
|
0.83% |
|
|
|
|
|
|
|
Portfolio turnover rate |
|
|
30% |
|
|
|
10% |
|
|
|
12% |
|
|
|
22% |
|
|
|
12% |
|
(1) |
Net
investment income per share was calculated using the average shares
outstanding method. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTERNATIONAL SMALL COMPANIES PORTFOLIO – INVESTOR
CLASS |
|
|
|
|
For the Fiscal Year
Ended Oct. 31, 2019 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2018 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2017 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2016 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2015 |
|
|
|
|
|
|
|
Net
asset value, beginning of year |
|
$ |
15.16 |
|
|
$ |
16.55 |
|
|
$ |
13.64 |
|
|
$ |
13.33 |
|
|
$ |
13.80 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase (Decrease) in Net Assets from Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income (loss)(1) |
|
|
0.09 |
|
|
|
0.10 |
|
|
|
0.05 |
|
|
|
0.16 |
|
|
|
0.08 |
|
|
|
|
|
|
|
Net realized and unrealized gain (loss) on investments and foreign
currency-related transactions |
|
|
1.21 |
|
|
|
(1.29 |
) |
|
|
3.42 |
|
|
|
0.35 |
|
|
|
(0.26 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
increase (decrease) from investment operations |
|
|
1.30 |
|
|
|
(1.19 |
) |
|
|
3.47 |
|
|
|
0.51 |
|
|
|
(0.18 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions to Shareholders from: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
(0.10 |
) |
|
|
(0.05 |
) |
|
|
(0.15 |
) |
|
|
(0.07 |
) |
|
|
(0.03 |
) |
|
|
|
|
|
|
Net
realized gain from investments |
|
|
(0.88 |
) |
|
|
(0.15 |
) |
|
|
(0.41 |
) |
|
|
(0.13 |
) |
|
|
(0.26 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
distributions |
|
|
(0.98 |
) |
|
|
(0.20 |
) |
|
|
(0.56 |
) |
|
|
(0.20 |
) |
|
|
(0.29 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
asset value, end of year |
|
$ |
15.48 |
|
|
$ |
15.16 |
|
|
$ |
16.55 |
|
|
$ |
13.64 |
|
|
$ |
13.33 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Return |
|
|
9.82% |
|
|
|
(7.35)% |
|
|
|
26.71% |
|
|
|
3.92% |
|
|
|
(1.29)% |
|
|
|
|
|
|
|
Ratios/Supplemental Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net assets, end of year (000’s) |
|
$ |
57,095 |
|
|
$ |
57,912 |
|
|
$ |
50,292 |
|
|
$ |
44,363 |
|
|
$ |
50,164 |
|
|
|
|
|
|
|
Expenses to average net assets |
|
|
1.70% |
|
|
|
1.75% |
|
|
|
1.80% |
|
|
|
1.90% |
|
|
|
1.93% |
|
|
|
|
|
|
|
Expenses to average net assets (net of fees
waived/reimbursed) |
|
|
1.40% |
|
|
|
1.40% |
|
|
|
1.40% |
|
|
|
1.50% |
|
|
|
1.55% |
|
|
|
|
|
|
|
Net investment income to average net assets |
|
|
0.63% |
|
|
|
0.58% |
|
|
|
0.37% |
|
|
|
1.18% |
|
|
|
0.58% |
|
|
|
|
|
|
|
Portfolio turnover rate |
|
|
37% |
|
|
|
52% |
|
|
|
19% |
|
|
|
49% |
|
|
|
38% |
|
(1) |
Net
investment income per share was calculated using the average shares
outstanding method. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EMERGING
MARKETS PORTFOLIO – ADVISOR CLASS |
|
|
|
|
For the Fiscal Year
Ended Oct. 31, 2019 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2018 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2017 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2016 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2015 |
|
|
|
|
|
|
|
Net
asset value, beginning of year |
|
$ |
48.21 |
|
|
$ |
57.46 |
|
|
$ |
46.27 |
|
|
$ |
42.02 |
|
|
$ |
50.88 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase (Decrease) in Net Assets from Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income (loss)(1) |
|
|
0.58 |
|
|
|
0.42 |
|
|
|
0.43 |
|
|
|
0.30 |
|
|
|
0.26 |
|
|
|
|
|
|
|
Net realized and unrealized gain (loss) on investments and foreign
currency-related transactions |
|
|
7.28 |
|
|
|
(9.24 |
) |
|
|
11.02 |
|
|
|
4.17 |
|
|
|
(6.80 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
increase (decrease) from investment operations |
|
|
7.86 |
|
|
|
(8.82 |
) |
|
|
11.45 |
|
|
|
4.47 |
|
|
|
(6.54 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions to Shareholders from: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
(0.42 |
) |
|
|
(0.40 |
) |
|
|
(0.26 |
) |
|
|
(0.22 |
) |
|
|
(0.39 |
) |
|
|
|
|
|
|
Net
realized gain from investments |
|
|
— |
|
|
|
(0.03 |
) |
|
|
— |
|
|
|
— |
(2) |
|
|
(1.93 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
distributions |
|
|
(0.42 |
) |
|
|
(0.43 |
) |
|
|
(0.26 |
) |
|
|
(0.22 |
) |
|
|
(2.32 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
asset value, end of year |
|
$ |
55.65 |
|
|
$ |
48.21 |
|
|
$ |
57.46 |
|
|
$ |
46.27 |
|
|
$ |
42.02 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Return |
|
|
16.46% |
|
|
|
(15.47)% |
|
|
|
24.93% |
|
|
|
10.73% |
|
|
|
(13.17)% |
|
|
|
|
|
|
|
Ratios/Supplemental Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net assets, end of year (000’s) |
|
$ |
4,274,314 |
|
|
$ |
3,459,157 |
|
|
$ |
4,014,977 |
|
|
$ |
2,998,484 |
|
|
$ |
2,381,671 |
|
|
|
|
|
|
|
Expenses to average net assets |
|
|
1.37% |
|
|
|
1.40% |
|
|
|
1.42% |
|
|
|
1.42% |
|
|
|
1.45% |
|
|
|
|
|
|
|
Expenses to average net assets (net of fees
waived/reimbursed) |
|
|
1.37% |
|
|
|
1.40% |
|
|
|
1.42% |
|
|
|
1.42% |
|
|
|
1.45% |
|
|
|
|
|
|
|
Net investment income to average net assets |
|
|
1.10% |
|
|
|
0.73% |
|
|
|
0.84% |
|
|
|
0.72% |
|
|
|
0.57% |
|
|
|
|
|
|
|
Portfolio turnover rate |
|
|
19% |
|
|
|
24% |
|
|
|
17% |
|
|
|
26% |
|
|
|
30% |
|
(1) |
Net
investment income per share was calculated using the average shares
outstanding method. |
(2) |
Amount was
less than $0.005 per share. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FRONTIER
EMERGING MARKETS PORTFOLIO – INVESTOR CLASS |
|
|
|
|
For the Fiscal Year
Ended Oct. 31, 2019 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2018 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2017 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2016 |
|
|
|
For the Fiscal Year
Ended Oct. 31, 2015 |
|
|
|
|
|
|
|
Net
asset value, beginning of year |
|
$ |
7.57 |
|
|
$ |
8.43 |
|
|
$ |
7.28 |
|
|
$ |
7.55 |
|
|
$ |
9.41 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase (Decrease) in Net Assets from Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income (loss)(1) |
|
|
0.11 |
|
|
|
0.07 |
|
|
|
0.04 |
|
|
|
0.07 |
|
|
|
0.06 |
|
|
|
|
|
|
|
Net realized and unrealized gain (loss) on investments and foreign
currency-related transactions |
|
|
0.13 |
|
|
|
(0.79 |
) |
|
|
1.15 |
|
|
|
(0.30 |
) |
|
|
(1.80 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
increase (decrease) from investment operations |
|
|
0.24 |
|
|
|
(0.72 |
) |
|
|
1.19 |
|
|
|
(0.23 |
) |
|
|
(1.74 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions to Shareholders from: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
investment income |
|
|
(0.06 |
) |
|
|
(0.14 |
) |
|
|
(0.04 |
) |
|
|
(0.04 |
) |
|
|
(0.02 |
) |
|
|
|
|
|
|
Net
realized gain from investments |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.10 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
distributions |
|
|
(0.06 |
) |
|
|
(0.14 |
) |
|
|
(0.04 |
) |
|
|
(0.04 |
) |
|
|
(0.12 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
asset value, end of year |
|
$ |
7.75 |
|
|
$ |
7.57 |
|
|
$ |
8.43 |
|
|
$ |
7.28 |
|
|
$ |
7.55 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Return |
|
|
3.24% |
|
|
|
(8.75)% |
|
|
|
16.40% |
|
|
|
(3.01)% |
|
|
|
(18.64)% |
|
|
|
|
|
|
|
Ratios/Supplemental Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net assets, end of year (000’s) |
|
$ |
20,560 |
|
|
$ |
25,388 |
|
|
$ |
30,981 |
|
|
$ |
32,771 |
|
|
$ |
45,622 |
|
|
|
|
|
|
|
Expenses to average net assets |
|
|
2.00% |
|
|
|
2.06% |
|
|
|
2.13% |
|
|
|
2.23% |
|
|
|
2.20% |
|
|
|
|
|
|
|
Expenses to average net assets (net of fees
waived/reimbursed) |
|
|
2.00% |
|
|
|
2.00% |
|
|
|
2.00% |
|
|
|
2.23% |
|
|
|
2.20% |
|
|
|
|
|
|
|
Net investment income to average net assets |
|
|
1.38% |
|
|
|
0.87% |
|
|
|
0.48% |
|
|
|
1.02% |
|
|
|
0.75% |
|
|
|
|
|
|
|
Portfolio turnover rate |
|
|
31% |
|
|
|
20% |
|
|
|
28% |
|
|
|
47% |
|
|
|
38% |
|
(1) |
Net
investment income per share was calculated using the average shares
outstanding method. |
HARDING, LOEVNER FUNDS,
INC. (THE “FUND”)
PRIVACY NOTICE
The Fund collects nonpublic personal
information about you from the following sources:
|
◾ |
|
Information, such as your name, address, social security number,
assets, and income, submitted by you on applications, forms, or in other
written or verbal customer communications. This information may also be
provided by a consultant or intermediary acting on your behalf.
|
|
◾ |
|
Information that results from any transaction performed by us for
you. |
The Fund will not disclose any
nonpublic personal information about you or its former customers to anyone
except as permitted or required by law.
If you decide to close your
account(s) or become an inactive customer, the Fund will adhere to the privacy
policies and practices as described in this notice.
The Fund restricts access to your
personal and account information to only those employees who need to know that
information to provide products or services to you. The Fund maintains physical,
administrative and technical safeguards to protect your nonpublic personal
information.
[This page is not part of the
Prospectus]
Availability of Additional Information About the Fund The
SAI, dated February 28, 2020, as may be supplemented thereafter, containing
additional information about the Fund and each Portfolio, has been filed with
the Securities and Exchange Commission (the ‘‘Commission’’) and is incorporated
by reference into this Prospectus. Additional information about each Portfolio’s
investments is available in the Fund’s annual and semi-annual reports to
shareholders. In the Fund’s annual report, you will find a discussion of the
market conditions and investment strategies that significantly affected each
Portfolio’s performance during its last fiscal year. To order free copies of the
Fund’s annual or semi-annual report or its SAI, to request other information
about the Fund and to make general shareholder inquiries, call (toll free) 1(877)435-8105, or write to the following
address: Harding, Loevner Funds, Inc. c/o The Northern Trust Company P.O. Box
4766 Chicago, Illinois 60680-4766 The SAI and the Fund’s annual and semi-annual
reports are also available free of charge on Harding Loevner’s website at
hardingloevnerfunds.com. Reports and other information about the Fund are also
available on the EDGAR database on the Commission’s Internet site at SEC.gov or
by electronic request at the following e-mail address: [email protected]. A
duplication fee will be applied to written requests and needs to be paid at the
time your request is submitted. Investment Company Act file number 811-07739 Harding, Loevner Funds, Inc. c/o
Northern Trust Attn: Funds Center, Floor 38 333 South Wabash Avenue Chicago, IL
60604 (877) 435-8105
www.hardingloevnerfunds.com