Most major U.S. stock indexes advanced amid good corporate earnings and hopes for an acceleration in economic growth in the spring, despite turmoil between Russia and Ukraine. Developed non-U.S. markets were mixed, with European and Nordic stocks delivering the best gains, while Asia-Pacific stocks were hurt by losses in Japan and Hong Kong. Emerging markets equities fell slightly against a backdrop of slowing growth in various economies.
The Global Infrastructure Fund returned 4.92% in the quarter compared with 6.78% for the UBS World Infrastructure & Utilities Index and 3.58% for the Lipper Specialty/Miscellaneous Funds Average. For the 12 months ended March 31, 2014, the fund returned 12.03% versus 13.80% for the UBS World Infrastructure & Utilities Index and 7.20% for the Lipper Specialty/Miscellaneous Funds Average. The fund's 1-year and Since Inception (01/27/2010) average annual total returns were 12.03% and 8.22%, respectively, as of March 31, 2014. The fund's expense ratio was 1.68% 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.
The Global Infrastructure 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.
Our good absolute performance, though underperforming the benchmark UBS World Infrastructure & Utilities Index, was driven by solid returns in the utilities and energy sectors. North America continues to be our largest regional exposure in the fund.. UK stocks, one of our larger country exposures helped performance. China's slowing growth weighed on the portfolio, as did losses in Japan stocks, although our Japan holdings outperformed the index. Indonesia was among the best-performing countries due to an overweight and good stock selection. Solid stock selection in India also contributed to results.
We believe Europe's anemic economic recovery will continue as austerity gradually eases and the U.S. recovers. Although optimistic about Japan's longer-term prospects, we are looking for signs that its policymakers will address key structural reforms. Emerging markets face slower growth amid a fading commodity super cycle and much slower growth in China. Over the longer term, we believe that the secular growth drivers for the emerging market asset class remain in place. We continue to leverage our independent global research platform and favor bottom-up stock selection to uncover unique opportunities.