Global equity markets sagged late in the quarter. U.S. stocks remained in slightly positive territory, while all other major regions declined. Europe suffered the most damage among developed markets. Developed European markets continued to struggle amid weakness in the manufacturing sector and negative consumer sentiment. Stocks in emerging markets were down slightly, though performance varied widely among individual emerging markets. Latin America and the emerging markets in Europe, the Middle East, and Africa were hit hardest.
The Global Stock Fund returned −0.98% in the quarter compared with −2.20% for the MSCI All Country World Index and −2.84% for the Lipper Global Multi-Cap Growth Funds Average. For the 12 months ended September 30, 2014, the fund returned 14.38% versus 11.89% for the MSCI All Country World Index and 8.82% for the Lipper Global Multi-Cap Growth Funds Average. The fund's average annual total returns were 14.38%, 11.35%, and 8.25% for the 1-, 5-, and 10-year periods, respectively, as of September 30, 2014. The fund's expense ratio was 0.91% as of its fiscal year ended October 31, 2013.
For up-to-date standardized total returns, including the most recent month-end performance, please click on the Performance tab, above.
Current performance may be lower or higher than the quoted past performance, which cannot guarantee future results.
Share price, principal value, and return will vary and you may have a gain or loss when you sell your shares.
The Global Stock Fund charges a 2%
redemption fee on shares held 90 days or less.
The performance information shown does not reflect the deduction of the redemption fee;
if it did, the performance would be lower.
Stock selection in the financials, information technology, and consumer discretionary sectors aided fund performance during the quarter. Our holdings in emerging markets were also beneficial, notwithstanding weakness in the regions, as was an underweight in Europe. On a negative note, our stock selection in industrials and telecommunications trimmed results. Our sector weightings are primarily the result of bottom-up stock picking. The portfolio's most notable overweight is industrials, given our recent additions following weakness in that area. We are also significantly overweight in information technology, with many of our positions focused on Internet companies that are hybrids of technology and media.
Despite some recent disappointments, we remain convinced the global economy will remain on an upward trajectory. Business conditions and industry dynamics remain broadly favorable, while the extended period of underinvestment experienced since the financial crises should ultimately yield a strong capital expenditure cycle. We believe that flagging European growth will benefit from the conclusion of the European Central Bank's asset quality review and its ongoing stimulus measures. The path forward for equities is likely to be volatile, but we believe it will be profitable for investors willing to take a disciplined, long-term approach. Our focus is centered on providing value through stock selection and prudent management of risk.