U.S. stocks generated mixed results in the second quarter. Major indexes reached new all-time highs in May and June but closed below their best levels of the quarter following a sharp sell-off at the end of June. For most of the period, the market was supported by merger activity, a strengthening economy, and signs that the stronger dollar and lower oil prices did not hurt first-quarter corporate earnings as much as initially feared.
The Spectrum Growth Fund returned 0.78% in the quarter compared with 0.14% for the Russell 3000 Index and 0.15% for the Lipper Multi-Cap Core Funds Index. For the 12 months ended June 30, 2015, the fund returned 4.12% versus 7.29% for the Russell 3000 Index and 5.97% for the Lipper Multi-Cap Core Funds Index. The fund's average annual total returns were 4.12%, 15.20%, and 7.95% for the 1-, 5-, and 10-year periods, respectively, as of June 30, 2015. The fund's expense ratio was 0.78% as of its fiscal year ended December 31, 2014.
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Current performance may be lower or higher than the quoted past performance, which cannot guarantee future results.
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The Spectrum Growth Fund blends domestic and non-U.S. growth and value funds across the market capitalization spectrum. Security selection produced strong results across a majority of the underlying funds. The inclusion of diversifying allocations contributed to relative performance for the period as did the holding non-U.S. equities, which outperformed U.S. equities. However, the addition of real assets partially offset some of the benefits of the non-U.S. equity inclusion.
Global growth is likely to progress at a modest pace over the coming months amid continuing accommodative monetary policies from many central banks, even as the Fed is likely to begin normalizing its interest rate policy later this year. We expect upward pressure on U.S. interest rates to trend higher if economic growth improves and the Fed begins to raise interest rates. We believe that modest global growth coupled with geopolitical uncertainty underscores the value of the Spectrum Funds' broadly diversified portfolios.
We believe that modest global growth coupled with geopolitical uncertainty underscore the value of the Spectrum Growth Fund's broadly diversified portfolios