485BPOS 2012-04-30 0001413594 2012-09-24 Aberdeen Funds false 2012-09-24 2012-09-24 <tt>The Diversified Alternatives Fund pays transaction costs, such as commissions,<br />when it buys and sells certain securities (or "turns over" its portfolio).&#xA0;&#xA0;A<br />higher portfolio turnover rate may indicate higher transaction costs and may<br />result in higher taxes when Fund shares are held in a taxable account.&#xA0;&#xA0;These<br />costs, which are not reflected in annual fund operating expenses or in the<br />example, affect the Fund's performance.&#xA0;&#xA0;During the most recent fiscal year, the<br />Fund's portfolio turnover rate was 26.76% of the average value of its portfolio.<br />The Fund's portfolio turnover rate for the current fiscal year is expected to be<br />higher as a result of purchases and sales of portfolio holdings made to realign<br />the Fund's portfolio with the investment strategy changes.</tt> <div style="display:none">~ http://www.aberdeen-asset.us/role/ExpenseExample_S000020306Member column dei_LegalEntityAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> <div style="display:none">~ http://www.aberdeen-asset.us/role/BarChartData_S000020306Member column dei_LegalEntityAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> <tt>The Aberdeen Diversified Alternatives Fund (formerly, Aberdeen Optimal Allocations <br />Fund: Specialty) (the "Diversified Alternatives Fund" or the "Fund") seeks total <br />return.</tt> <tt>This Example is intended to help you compare the cost of investing in the<br />Diversified Alternatives Fund with the cost of investing in other mutual funds.<br /><br />The Example assumes that you invest $10,000 in the Diversified Alternatives Fund<br />for the time periods indicated and then sell all of your shares at the end of<br />those periods. It assumes a 5% return each year, no change in expenses and the<br />expense limitations (if applicable). Although your actual costs may be higher or<br />lower, based on these assumptions your costs would be:</tt> <tt>The Diversified Alternatives Fund is a "fund of funds" that seeks to achieve its<br />investment objective by investing in underlying funds (the "Underlying Funds")<br />that provide exposure to non-traditional or alternative asset classes or<br />investment strategies.&#xA0;&#xA0;The Fund intends to allocate and reallocate its assets<br />among a range of non-traditional or alternative asset classes in a flexible and<br />dynamic way to capture return from such non-traditional or alternative sources. <br />The Fund's non-traditional or alternative exposures include industry sector<br />equity strategies, long-short strategies, foreign currency trading strategies,<br />floating rate bank loans, emerging market bonds, managed futures strategies,<br />real estate and&#xA0;&#xA0;other non-core investments. The Fund seeks to provide a return<br />that has low correlation to traditional core asset classes (i.e., U.S. large cap<br />equity and investment grade bonds) by combining several non-traditional or<br />alternative asset class exposures in measured amounts.&#xA0;&#xA0;In selecting Underlying<br />Funds and asset class exposures, the Adviser will take asset diversification and<br />potential volatility of return into account.&#xA0;&#xA0;Non-traditional or alternative<br />asset categories have tended over time to have a lower correlation with the<br />broad U.S. stock and bond markets. The Underlying Funds include, among others,<br />mutual funds advised by Aberdeen Asset Management Inc., the Fund's investment<br />adviser (the "Adviser"), as well as unaffiliated mutual funds and exchange-traded <br />funds. There is no minimum or maximum amount of assets that can be invested in <br />affiliated Underlying Funds.&#xA0;&#xA0;The Underlying Funds may be either actively managed <br />or passively managed (that is, provided indexed exposures) in nature. Some or all <br />of the Underlying Funds may invest in derivatives.<br /><br />The Adviser develops strategic asset allocation views among broad asset classes<br />based on its ongoing analyses of global financial markets and macro-economic<br />conditions. The Fund's portfolio management team constructs the Fund's portfolio <br />by setting target asset class allocations for the Fund. The portfolio management <br />team then manages the Fund's portfolio by dynamically adjusting the Fund's asset <br />class allocations based on the Adviser's asset allocation views and selecting <br />Underlying Funds to obtain exposures to the asset classes. The asset category <br />allocations for the Fund are limited to non-traditional or alternative asset <br />categories. As part of its process, the team evaluates the suitability of both <br />active and passive vehicles to provide exposure to each asset category. The target <br />asset category allocations established by the portfolio management team are <br />intended to promote diversification among the asset classes.&#xA0;&#xA0;The Fund's target <br />and actual asset category allocations and the Underlying Funds held in the Fund's <br />portfolio are monitored by the portfolio management team on an ongoing basis and <br />may be adjusted to reflect changes to the Adviser's views. The Fund retains the <br />flexibility to emphasize specific asset category allocations based on relative <br />valuations and other economic factors in order to seek to achieve the Fund's <br />objective. While the Fund will not invest more than 25% of its total assets in <br />any one Underlying Fund, the Fund may have significant exposure to one or more <br />asset classes (including real estate and commodities) depending on market<br />conditions.&#xA0;&#xA0;The Fund has the ability to invest, through the Underlying Funds,<br />in small, medium or large capitalization issuers without regard to credit<br />quality (including high yield bonds, which are commonly known as "junk bonds")<br />or geographic location, and is not limited by industry sector or the duration of<br />individual instruments or the portfolio as a whole. At times, the Fund may<br />emphasize any one of these exposures. Asset classes may be added or removed at<br />the Adviser's discretion.<br /><br />For additional information regarding the above identified strategies, see "Fund<br />Details: Additional Information about Principal Strategies" in the prospectus.</tt> Aberdeen Diversified Alternatives Fund (formerly, Aberdeen Optimal Allocations Fund: Specialty) You may qualify for sales charge discounts if you and your family invest, or agree to invest in the future, at least $50,000 in Aberdeen Funds. Example After-tax returns are calculated using the historical highest individual federal marginal income tax rates in effect and do not reflect state and local taxes. Objective Remember, however, that past performance (before and after taxes) is not necessarily indicative of how the Fund will perform in the future. If the value of the Fund's investments goes down, you may lose money. "Acquired fund fees and expenses" are based on the estimated composition of the Fund for the upcoming year. Principal Risks Shareholder Fees (fees paid directly from your investment) 0.2676 Your actual after-tax return depends on your personal tax situation and may differ from what is shown here. After-tax returns are not relevant to investors in tax-deferred arrangements, such as individual retirement accounts, 401(k) plans or certain other employer-sponsored retirement plans. Annual Total Returns - Class A Shares (Years Ended Dec. 31) Performance 50000 The bar chart and table below can help you evaluate potential risks of the Diversified Alternatives Fund. <tt>Best Quarter:&#xA0;&#xA0;19.07% - 2nd quarter 2009<br /><br />Worst Quarter:&#xA0;&#xA0;-21.91% - 4th quarter 2008<br /><br />Year-to-Date Return as of June 30, 2012: 11.87%</tt> 866-667-9231 Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment) Average Annual Total Returns as of December 31, 2011 Portfolio Turnover <tt>The Diversified Alternatives Fund cannot guarantee that it will achieve its<br />investment objective.<br /><br />As with any fund, the value of the Fund's investments - and therefore, the value<br />of Fund shares - may fluctuate. These changes may occur because of:<br /><br />Affiliated Funds Risk - The Fund's Adviser serves as the adviser of certain<br />Underlying Funds. It is possible that a conflict of interest among the Fund and<br />the Underlying Funds could affect how the Fund's Adviser fulfills its fiduciary<br />duties to the Fund and the Underlying Funds.<br /><br />Asset Allocation Risk - The Fund is subject to different levels and combinations<br />of risk, based on its actual allocation among the various asset classes and<br />Underlying Funds.&#xA0;&#xA0;The Fund will be exposed to risks of the Underlying Funds in<br />which it invests. The Fund will be affected by stock and bond market risks,<br />among others.&#xA0;&#xA0;To the extent the Fund invests in Underlying Funds that expose it<br />to non-traditional or alternative asset classes (which include investments that<br />focus on a specialized asset class (e.g. long-short strategies) as well as<br />specific market sectors within a broader asset class), the Fund will be exposed<br />to the increased risk associated with those asset classes.&#xA0;&#xA0;The potential impact<br />of the risks related to an asset class depends on the size of Fund's investment<br />allocation to it.<br /><br />Asset Class Variation Risk - The Underlying Funds invest principally in the<br />securities or investments constituting their asset class. However, under normal<br />market conditions, an Underlying Fund may vary the percentage of its assets in<br />these securities or investments (subject to any applicable regulatory requirements). <br />Depending upon the percentage of securities or investments in a particular asset <br />class held by the Underlying Funds at any given time and the percentage of the <br />Fund's assets invested in various Underlying Funds, the Fund's actual exposure <br />to the securities or investments in a particular asset class may vary substantially <br />from its allocation model for that asset class.<br /><br />Fund of Funds Risk - Your cost of investing in the Fund, as a fund of funds, may<br />be higher than the cost of investing in a mutual fund that only invests directly<br />in individual securities. An Underlying Fund may change its investment objective<br />or policies without the Fund's approval, which could force the Fund to withdraw<br />its investment from such Underlying Fund at a time that is unfavorable to the<br />Fund. In addition, one Underlying Fund may buy the same securities that another<br />Underlying Fund sells. Therefore, the Fund would indirectly bear the costs of<br />these trades without accomplishing any investment purpose.<br /><br />Performance Risk - The Fund's investment performance is directly tied to the<br />performance of the Underlying Funds in which the Fund invests. If one or more<br />of the Underlying Funds fails to meet its investment objective, the Fund's<br />performance could be negatively affected. There can be no assurance that the<br />Fund or any Underlying Fund will achieve its investment objective.<br /><br />Redemption Fee Risk - Certain unaffiliated Underlying Funds may charge redemption <br />fees to shareholders who redeem their Underlying Fund shares within a specified <br />period of time following the purchase of such shares.<br /> <br />Ordinarily, a mutual fund that imposes redemption fees does so in order to deter<br />investors from engaging in excessive or short-term trading, often referred to as<br />"market timing," and to reimburse it for transaction costs borne by other fund<br />shareholders on account of market timing activity.&#xA0;&#xA0;The Fund does not intend to<br />engage in market timing in Underlying Fund shares.&#xA0;&#xA0;However, the Fund will place<br />purchase and redemption orders in shares of Underlying Funds pursuant to an<br />established asset allocation model in response to daily purchases and redemptions <br />of the Fund's own shares, to conduct periodic rebalancing of the Fund's assets to <br />conform to the established model following periods of market fluctuation, and in <br />response to changes made to an existing asset allocation model itself. While the <br />portfolio managers will attempt to conduct the Fund's purchase and redemption of <br />Underlying Fund shares in a manner to avoid or minimize subjecting the Fund to <br />redemption fees, there may be instances where payment of such fees is unavoidable <br />or the portfolio managers are not successful in minimizing their impact.<br /><br />Principal Risks of Underlying Funds<br /><br />Alternative Strategies Risk - The performance of Underlying Funds that pursue<br />alternative strategies is linked to the performance of highly volatile<br />alternative asset classes (e.g., commodities and currencies) and alternative<br />strategies (e.g., managed futures). To the extent the Fund invests in such <br />Underlying Funds, the Fund's share price will be exposed to potentially significant <br />fluctuations in value. In addition, Underlying Funds that employ alternative <br />strategies have the risk that anticipated opportunities do not play out as planned, <br />resulting in potentially substantial losses to the Underlying Fund. Furthermore, <br />alternative strategies may employ leverage, involve extensive short positions <br />and/or focus on narrow segments of the market, which may magnify the overall risks <br />and volatility associated with such Underlying Funds' investments.&#xA0;&#xA0;Depending on <br />the particular alternative strategies used by an Underlying Fund, it may be subject <br />to risks not associated with more traditional investments.&#xA0;&#xA0;These risks may include, <br />but are not limited to, derivatives risk, liquidity risk, credit risk, commodity<br />risk and counterparty risk.<br /> <br />Commodity Risk - the value of commodities may be more volatile than the value of<br />equity securities or debt instruments and their value may be affected by changes<br />in overall market movements, commodity index volatility, changes in interest<br />rates, or factors affecting a particular industry or commodity. The price of a<br />commodity may be affected by demand/supply imbalances in the market for the<br />commodity.<br /><br />Counterparty and Third Party Risk - transactions involving a counterparty or third <br />party (other than the issuer of the instrument) are subject to the counterparty's <br />or third party's credit risk and ability to perform in accordance with the terms <br />of the transaction.<br /> <br />Credit Risk - a debt instrument's price depends, in part, on the credit quality<br />of the issuer, borrower, counterparty, or underlying collateral and can decline<br />in response to changes in the financial condition of the issuer, borrower,<br />counterparty, or underlying collateral, or changes in specific or general<br />market, economic, industry, political, regulatory, geopolitical, or other<br />conditions. High yield bonds ("junk bonds") may be subject to an increased risk<br />of default, a more limited secondary market than investment grade bonds, and<br />greater price volatility.<br /><br />Currency Risk - the value of foreign currencies relative to the U.S. dollar<br />fluctuates in response to market, economic, political, regulatory, geopolitical<br />or other conditions. A decline in the value of a foreign currency versus the<br />U.S. dollar reduces the value in U.S. dollars of investments denominated in that<br />foreign currency.<br /><br />Derivatives Risk - derivatives can be highly volatile and involve risks in addition <br />to the risks of the underlying security. Gains or losses from derivatives can be <br />substantially greater than the derivatives' original cost and can involve leverage.<br /> <br />Floating Rate Loan Risk - Floating rate loans generally are subject to restrictions <br />on resale. Floating rate loans sometimes trade infrequently in the secondary market. <br />As a result, valuing a floating rate loan can be more difficult, and buying and <br />selling a floating rate loan at an acceptable price can be more difficult or delayed. <br />Difficulty in selling a floating rate loan can result in a loss. In addition, a <br />floating rate loan may not be fully collateralized which may cause the floating rate <br />loan to decline significantly in value.<br /> <br />Foreign and Emerging Markets Risk - foreign securities can involve risks<br />relating to market, economic, political, regulatory, geopolitical, or other<br />conditions and may be more volatile, harder to price and less liquid than U.S.<br />securities.&#xA0;&#xA0;These risks are greater for securities of companies in emerging<br />markets countries.<br /><br />Inflation-Adjusting Risk - interest payments on inflation-adjusted debt<br />instruments can be unpredictable and vary based on the level of inflation. If<br />inflation is negative, principal and income can both decline.<br /><br />Interest Rate Risk - changes in interest rates may cause a decline in the market<br />value of an investment. With bonds and other fixed-income securities, a rise in<br />interest rates typically causes a fall in values.<br /><br />Leveraging Risk - the use of leverage may exaggerate changes in the net asset<br />value of Underlying Fund shares and thus result in increased volatility of<br />returns.<br /><br />Liquidity Risk - it may not be possible to sell certain investments, types of<br />investments, and/or segments of the market at any particular time or at an<br />acceptable price.<br /><br />Prepayment/Extension Risk - instruments subject to prepayment and/or extension<br />can reduce the potential for gain for the instrument's holders if the instrument<br />is prepaid and increase the potential for loss if the maturity of the instrument<br />is extended.<br /> <br />Real Estate-Related Investment Risk - investing in real estate-related securities <br />include risks related to general, regional and local economic conditions; <br />fluctuations in interest rates; property tax rates, zoning laws, environmental <br />regulations and other governmental action; cash flow dependency; increased <br />operating expenses; lack of availability of mortgage funds; losses due to natural <br />disasters; changes in property values and rental rates; and other factors.<br /><br />Sector Risk - At times, the Fund may have a significant portion of its assets<br />invested in Underlying Funds that invest primarily in securities of companies<br />conducting business in a broadly related group of industries within an economic <br />sector. Companies in the same economic sector may be similarly affected by economic <br />or market events, making the Fund more vulnerable to unfavorable developments in <br />that economic sector than funds that invest more broadly.<br /> <br />Short Sale Risk - the risk that the price of the security sold short will increase <br />in value between the time of the short sale and the time the Underlying Fund must <br />purchase the security and return it to the lender.<br /><br />Small- and Mid-Cap Securities Risk - in general, stocks of small- and mid-cap<br />companies may be more volatile and less liquid than larger company stocks.<br /> <br />Stock Market Risk - an Underlying Fund could lose value if the individual stocks<br />in which it invests or overall stock markets in which such stocks trade go down.<br /><br />If the value of the Fund's investments goes down, you may lose money.<br /><br />For additional information regarding the above identified risks, see "Fund Details: <br />Additional Information about Investments, Investment Techniques and Risks" in the <br />prospectus.</tt> Fees and Expenses of the Fund After-tax returns are shown in the following table for Class A shares only and will vary for other classes. Principal Strategies www.aberdeen-asset.us <tt>The Fund changed its investment objective and strategy effective September 24,<br />2012. Performance information for periods prior to September 24, 2012 does not<br />reflect the current investment strategy.&#xA0;&#xA0;In connection with the change of<br />investment objective and strategy, the Fund changed its name from Aberdeen<br />Optimal Allocations Fund: Specialty to Aberdeen Diversified Alternatives Fund.<br />The returns presented for the Fund for periods prior to June 23, 2008 reflect<br />the performance of a predecessor fund (the "Predecessor Fund"). The Fund adopted<br />the performance of the Predecessor Fund as the result of a reorganization on<br />June 23, 2008 in which the Fund acquired all of the assets, subject to the<br />liabilities, of the Predecessor Fund. The investment objective and strategy of<br />the Fund, prior to the recent changes noted above, and those of the Predecessor<br />Fund, were substantially similar.<br /><br />The bar chart and table below can help you evaluate potential risks of the<br />Diversified Alternatives Fund. The bar chart shows how the Fund's annual total<br />returns for Class A have varied from year to year. The returns in the bar chart<br />do not reflect the impact of sales charges. If the applicable sales charges were<br />included, the annual total returns would be lower than those shown. The table<br />compares the Fund's average annual total returns to the returns of the Citi<br />3-Month Treasury Bill and the S&amp;P 500 Index. Effective September 24, 2012, the<br />Citi 3-Month Treasury Bill Index replaced the S&amp;P 500 Index as the Fund's<br />benchmark. The Adviser believes that the composition of the Citi 3-Month Treasury <br />Bill Index makes it the most meaningful comparison index given the Fund's <br />investment objective. Remember, however, that past performance (before and after <br />taxes) is not necessarily indicative of how the Fund will perform in the future. <br />For updated performance information, please visit www.aberdeen-asset.us or call <br />866-667-9231.</tt> <tt>This table describes the fees and expenses that you may pay when you buy and<br />hold shares of the Diversified Alternatives Fund. You may qualify for sales<br />charge discounts if you and your family invest, or agree to invest in the<br />future, at least $50,000 in Aberdeen Funds.&#xA0;&#xA0;More information about these and<br />other discounts is available from your financial advisor and in the "Investing<br />with Aberdeen Funds: Choosing a Share Class - Reduction and Waiver of Class A<br />Sales Charges" section on page 33 of the Fund's prospectus and in the<br />"Additional Information on Purchases and Sales" - "Waiver of Class A Sales<br />Charges" and "Reduction of Sales Charges" section on pages 90-92 of the Fund's<br />Statement of Additional Information.</tt> <div style="display:none">~ http://www.aberdeen-asset.us/role/OperatingExpensesData_S000020306Member column dei_LegalEntityAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> You would pay the following expenses on the same investment if you did not sell your shares: <div style="display:none">~ http://www.aberdeen-asset.us/role/PerformanceTableData_S000020306Member column dei_LegalEntityAxis compact * column rr_PerformanceMeasureAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> <tt>After-tax returns are shown in the following table for Class A shares only and<br />will vary for other classes. After-tax returns are calculated using the<br />historical highest individual federal marginal income tax rates in effect and do<br />not reflect state and local taxes. Your actual after-tax return depends on your<br />personal tax situation and may differ from what is shown here. After-tax returns<br />are not relevant to investors in tax-deferred arrangements, such as individual<br />retirement accounts, 401(k) plans or certain other employer-sponsored retirement<br />plans.</tt> <div style="display:none">~ http://www.aberdeen-asset.us/role/ExpenseExampleNoRedemption_S000020306Member column dei_LegalEntityAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> <div style="display:none">~ http://www.aberdeen-asset.us/role/ShareholderFeesData_S000020306Member column dei_LegalEntityAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> Citi 3-Month Treasury Bill Index 0.0008 0.0136 0.0219 2004-06-29 S&P 500® Index 0.0211 -0.0025 0.0350 2004-06-29 Class A shares - After Taxes on Distributions and Sales of Shares -0.0415 -0.0113 0.0358 2004-06-29 Class A shares - After Taxes on Distributions -0.0692 -0.0181 0.0361 2004-06-29 GAISX 0.0000 Institutional Service Class shares - Before Taxes 136 481 -0.0052 2092 906 -0.0601 0.0067 0.0015 2014-02-27 -0.0059 0.0000 0.0134 0.0186 0.0510 2004-06-29 0.0104 0.0000 GASIX 0.0000 Institutional Class shares - Before Taxes 131 465 -0.0052 2038 880 -0.0601 0.0062 0.0015 2014-02-27 -0.0059 0.0000 0.0129 0.0181 0.0510 2004-06-29 0.0104 0.0000 GASRX 0.0000 Class R shares - Before Taxes 186 631 -0.0052 2604 1158 -0.0656 0.0066 0.0015 2014-02-27 -0.0111 0.0050 0.0183 0.0235 0.0454 2004-06-29 0.0104 0.0000 GAMCX 0.0000 Class C shares - Before Taxes 332 232 770 -0.0052 3060 1389 -0.0692 0.0062 0.0015 2014-02-27 3060 -0.0156 770 1389 0.0100 0.0229 0.0281 0.0405 2004-06-29 0.0104 0.0100 GASAX Worst Quarter: Best Quarter: 0.0575 2012-06-30 Class A shares - Before Taxes 724 2009-06-30 1089 -0.2191 -0.0052 0.1160 2757 1532 0.1083 0.1907 -0.0638 0.0063 -0.3738 0.0015 2014-02-27 2008-12-31 0.3221 -0.0084 0.1046 Year-to-Date -0.0638 0.0025 0.0155 0.0207 0.1864 0.0481 2004-06-29 0.1187 0.0104 0.0000 <tt>The Dynamic Allocation Fund pays transaction costs, such as commissions, when <br />it buys and sells certain securities (or "turns over" its portfolio). A higher<br />portfolio turnover rate may indicate higher transaction costs and may result <br />in higher taxes when Fund shares are held in a taxable account. These costs, <br />which are not reflected in annual fund operating expenses or in the example, <br />affect the Fund's performance. During the most recent fiscal year, the Fund's <br />portfolio turnover rate was 20.14% of the average value of its portfolio. The <br />Fund's portfolio turnover rate for the current fiscal year is expected to be <br />higher as a result of purchases and sales of portfolio holdings made to realign <br />the Fund's portfolio with the investment strategy changes.</tt> <div style="display:none">~ http://www.aberdeen-asset.us/role/ExpenseExample_S000020304Member column dei_LegalEntityAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> <div style="display:none">~ http://www.aberdeen-asset.us/role/BarChartData_S000020304Member column dei_LegalEntityAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> <tt>The Aberdeen Dynamic Allocation Fund (formerly, Aberdeen Optimal Allocations Fund: <br />Moderate Growth) (the "Dynamic Allocation Fund" or the "Fund") seeks total return.</tt> <tt>This Example is intended to help you compare the cost of investing in the<br />Dynamic Allocation Fund with the cost of investing in other mutual funds.<br /><br />The Example assumes that you invest $10,000 in the Dynamic Allocation Fund <br />for the time periods indicated and then sell all of your shares at the end <br />of those periods. It assumes a 5% return each year, no change in expenses <br />and the expense limitations (if applicable). Although your actual costs may <br />be higher or lower, based on these assumptions your costs would be:</tt> reflects no deduction for fees, expenses or taxes <tt>The Dynamic Allocation Fund is a "fund of funds" that seeks to achieve its<br />investment objective by investing in underlying funds (the "Underlying Funds")<br />that provide exposure to a wide spectrum of asset classes. The Fund intends to<br />allocate and reallocate its assets among a range of asset classes in a flexible<br />and dynamic way to capture return from a number of equity, fixed income and<br />other sources.&#xA0;&#xA0;The types of asset classes to which the Underlying Funds provide<br />exposure include U.S. and international equities, U.S. and international bonds<br />(including emerging market bonds) and real estate. The Fund may also allocate<br />assets to a limited extent to Underlying Funds that pursue alternative investment <br />strategies, such as managed futures, commodity-linked instruments, equity sectors, <br />currencies and floating rate loans. The Underlying Funds include, among others, <br />mutual funds advised by Aberdeen Asset Management Inc., the Fund's investment <br />adviser (the "Adviser"), as well as unaffiliated mutual funds and exchange-traded <br />funds. There is no minimum or maximum amount of assets that can be invested in <br />affiliated Underlying Funds. The Underlying Funds may be either actively managed <br />or passively managed (that is, providing indexed exposures) in nature. Some or <br />all of the Underlying Funds may invest in derivatives.<br /><br />The Adviser develops strategic asset allocation views among broad asset classes<br />based on its ongoing analyses of global financial markets and macro-economic<br />conditions. The Fund's portfolio management team constructs the Fund's portfolio <br />by setting target asset class allocations for the Fund. The portfolio management <br />team then manages the Fund's portfolio by dynamically adjusting the Fund's asset <br />class allocations based on the Adviser's asset allocation views and selecting <br />Underlying Funds to obtain exposures to the asset classes. As part of its <br />process, the team evaluates the suitability of both active and passive vehicles <br />to provide exposure to each asset class. The Fund's target and actual asset class <br />allocations and the Underlying Funds held in the Fund's portfolio are monitored <br />by the portfolio management team on an ongoing basis and are adjusted periodically <br />to reflect changes to the Adviser's views. The Fund retains the flexibility to <br />emphasize specific asset class allocations based on relative valuations and other <br />economic factors in order to seek to achieve the Fund's objective. While the Fund <br />will not invest more than 25% of its total assets in any one Underlying Fund, the <br />Fund may have significant exposure to one or more asset classes depending on market <br />conditions. The Fund has the ability to invest, through the Underlying Funds, in <br />small, medium or large capitalization issuers without regard to credit quality <br />(including high yield bonds, which are commonly known as "junk bonds") or geographic <br />location, and is not limited by industry sector or the duration of individual <br />instruments or the portfolio as a whole.&#xA0;&#xA0;At times, the Fund may emphasize any one <br />of these exposures. Asset classes may be added or removed at the Adviser's discretion.<br /><br />For additional information regarding the above identified strategies, see "Fund<br />Details: Additional Information about Principal Strategies" In the prospectus.</tt> Aberdeen Dynamic Allocation Fund (formerly, Aberdeen Optimal Allocations Fund: Moderate Growth) You may qualify for sales charge discounts if you and your family invest, or agree to invest in the future, at least $50,000 in Aberdeen Funds. Example After-tax returns are calculated using the historical highest individual federal marginal income tax rates in effect and do not reflect state and local taxes. Objective Remember, however, that past performance (before and after taxes) is not necessarily indicative of how the Fund will perform in the future. If the value of the Fund's investments goes down, you may lose money. "Acquired fund fees and expenses" are based on the estimated composition of the Fund for the upcoming year. Principal Risks Shareholder Fees (fees paid directly from your investment) 0.2014 Your actual after-tax return depends on your personal tax situation and may differ from what is shown here. After-tax returns are not relevant to investors in tax-deferred arrangements, such as individual retirement accounts, 401(k) plans or certain other employer-sponsored retirement plans. Annual Total Returns - Class A Shares (Years Ended Dec. 31) Performance 50000 The bar chart and table below can help you evaluate potential risks of the Dynamic Allocation Fund. <tt>Best Quarter:&#xA0;&#xA0;16.83% - 2nd quarter 2009<br /><br />Worst Quarter:&#xA0;&#xA0;-18.37% - 4th quarter 2008<br /><br />Year-to-Date Return as of June 30, 2012: 10.87%</tt> 866-667-9231 Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment) Average Annual Total Returns as of December 31, 2011 Portfolio Turnover <tt>The Dynamic Allocation Fund cannot guarantee that it will achieve its investment<br />objective.<br /><br />As with any fund, the value of the Fund's investments - and therefore, the value<br />of Fund shares - may fluctuate. These changes may occur because of:<br /> <br />Affiliated Funds Risk - The Fund's Adviser serves as the adviser of certain<br />Underlying Funds. It is possible that a conflict of interest among the Fund and <br />the Underlying Funds could affect how the Fund's Adviser fulfills its fiduciary <br />duties to the Fund and the Underlying Funds.<br /> <br />Asset Allocation Risk - The Fund is subject to different levels and combinations<br />of risk, based on its actual allocation among the various asset classes and<br />Underlying Funds.&#xA0;&#xA0;The Fund will be exposed to risks of the Underlying Funds in<br />which it invests. The Fund will be affected by stock and bond market risks,<br />among others.&#xA0;&#xA0;To the extent the Fund invests in Underlying Funds that expose it<br />to non-traditional or alternative asset classes (which include investments that<br />focus on a specialized asset class (e.g. long-short strategies) as well as<br />specific market sectors within a broader asset class), the Fund will be exposed<br />to the increased risk associated with those asset classes.&#xA0;&#xA0;The potential impact<br />of the risks related to an asset class depends on the size of Fund's investment<br />allocation to it.<br /><br />Asset Class Variation Risk - The Underlying Funds invest principally in the<br />securities or investments constituting their asset class. However, under normal<br />market conditions, an Underlying Fund may vary the percentage of its assets in<br />these securities or investments (subject to any applicable regulatory requirements). <br />Depending upon the percentage of securities or investments in a particular asset <br />class held by the Underlying Funds at any given time and the percentage of the <br />Fund's assets invested in various Underlying Funds, the Fund's actual exposure <br />to the securities or investments in a particular asset class may vary <br />substantially from its allocation model for that asset class.<br /><br />Fund of Funds Risk - Your cost of investing in the Fund, as a fund of funds, may<br />be higher than the cost of investing in a mutual fund that only invests directly<br />in individual securities. An Underlying Fund may change its investment objective<br />or policies without the Fund's approval, which could force the Fund to withdraw<br />its investment from such Underlying Fund at a time that is unfavorable to the<br />Fund. In addition, one Underlying Fund may buy the same securities that another<br />Underlying Fund sells. Therefore, the Fund would indirectly bear the costs of<br />these trades without accomplishing any investment purpose.<br /><br />Performance Risk - The Fund's investment performance is directly tied to the<br />performance of the Underlying Funds in which the Fund invests.&#xA0;&#xA0;If one or more<br />of the Underlying Funds fails to meet its investment objective, the Fund's<br />performance could be negatively affected.&#xA0;&#xA0;There can be no assurance that the<br />Fund or any Underlying Fund will achieve its investment objective.<br /><br />Redemption Fee Risk - Certain unaffiliated Underlying Funds may charge redemption <br />fees to shareholders who redeem their Underlying Fund shares within a specified <br />period of time following the purchase of such shares.<br /> <br />Ordinarily, a mutual fund that imposes redemption fees does so in order to deter<br />investors from engaging in excessive or short-term trading, often referred to as<br />"market timing," and to reimburse it for transaction costs borne by other fund<br />shareholders on account of market timing activity. The Fund does not intend to<br />engage in market timing in Underlying Fund shares. However, the Fund will place<br />purchase and redemption orders in shares of Underlying Funds pursuant to an<br />established asset allocation model in response to daily purchases and redemptions <br />of the Fund's own shares, to conduct periodic rebalancing of the Fund's assets <br />to conform to the established model following periods of market fluctuation, and <br />in response to changes made to an existing asset allocation model itself. While <br />the portfolio managers will attempt to conduct the Fund's purchase and redemption <br />of Underlying Fund shares in a manner to avoid or minimize subjecting the Fund to <br />redemption fees, there may be instances where payment of such fees is unavoidable <br />or the portfolio managers are not successful in minimizing their impact.<br /><br />Principal Risks of Underlying Funds<br /><br />Alternative Strategies Risk - The performance of Underlying Funds that pursue<br />alternative strategies is linked to the performance of highly volatile<br />alternative asset classes (e.g., commodities and currencies) and alternative<br />strategies (e.g., managed futures). To the extent the Fund invests in such<br />Underlying Funds, the Fund's share price will be exposed to potentially<br />significant fluctuations in value. In addition, Underlying Funds that employ<br />alternative strategies have the risk that anticipated opportunities do not play<br />out as planned, resulting in potentially substantial losses to the Underlying<br />Fund. Furthermore, alternative strategies may employ leverage, involve extensive <br />short positions and/or focus on narrow segments of the market, which may magnify <br />the overall risks and volatility associated with such Underlying Funds' <br />investments.&#xA0;&#xA0;Depending on the particular alternative strategies used by an <br />Underlying Fund, it may be subject to risks not associated with more traditional <br />investments.&#xA0;&#xA0;These risks may include, but are not limited to, derivatives risk, <br />liquidity risk, credit risk, commodity risk and counterparty risk.<br /><br />Commodity Risk - the value of commodities may be more volatile than the value of<br />equity securities or debt instruments and their value may be affected by changes<br />in overall market movements, commodity index volatility, changes in interest<br />rates, or factors affecting a particular industry or commodity. The price of a<br />commodity may be affected by demand/supply imbalances in the market for the<br />commodity.<br />&#xA0;&#xA0;<br />Counterparty and Third Party Risk - transactions involving a counterparty or third <br />party (other than the issuer of the instrument) are subject to the counterparty's <br />or third party's credit risk and ability to perform in accordance with the terms <br />of the transaction.<br /> <br />Credit Risk - a debt instrument's price depends, in part, on the credit quality of <br />the issuer, borrower, counterparty, or underlying collateral and can decline in <br />response to changes in the financial condition of the issuer, borrower,<br />counterparty, or underlying collateral, or changes in specific or general market, <br />economic, industry, political, regulatory, geopolitical, or other conditions. High <br />yield bonds ("junk bonds") may be subject to an increased risk of default, a more <br />limited secondary market than investment grade bonds, and greater price volatility.<br /><br />Currency Risk - the value of foreign currencies relative to the U.S. dollar<br />fluctuates in response to market, economic, political, regulatory, geopolitical<br />or other conditions. A decline in the value of a foreign currency versus the U.S. <br />dollar reduces the value in U.S. dollars of investments denominated in that foreign <br />currency.<br /><br />Derivatives Risk - derivatives can be highly volatile and involve risks in addition <br />to the risks of the underlying security. Gains or losses from derivatives can be <br />substantially greater than the derivatives' original cost and can involve leverage.<br /> <br />Floating Rate Loan Risk - Floating rate loans generally are subject to restrictions <br />on resale. Floating rate loans sometimes trade infrequently in the secondary market. <br />As a result, valuing a floating rate loan can be more difficult, and buying and <br />selling a floating rate loan at an acceptable price can be more difficult or delayed. <br />Difficulty in selling a floating rate loan can result in a loss. In addition, a <br />floating rate loan may not be fully collateralized which may cause the floating rate <br />loan to decline significantly in value.<br /><br />Foreign and Emerging Markets Risk - foreign securities can involve risks relating <br />to market, economic, political, regulatory, geopolitical, or other conditions and <br />may be more volatile, harder to price and less liquid than U.S. securities. These <br />risks are greater for securities of companies in emerging markets countries.<br /> <br />Inflation-Adjusting Risk - interest payments on inflation-adjusted debt instruments <br />can be unpredictable and vary based on the level of inflation. If inflation is <br />negative, principal and income can both decline.<br /> <br />Interest Rate Risk - changes in interest rates may cause a decline in the market<br />value of an investment. With bonds and other fixed-income securities, a rise in<br />interest rates typically causes a fall in values.<br /><br />Leveraging Risk - the use of leverage may exaggerate changes in the net asset<br />value of Underlying Fund shares and thus result in increased volatility of<br />returns.<br /><br />Liquidity Risk - it may not be possible to sell certain investments, types of<br />investments, and/or segments of the market at any particular time or at an<br />acceptable price.<br /><br />Prepayment/Extension Risk - instruments subject to prepayment and/or extension<br />can reduce the potential for gain for the instrument's holders if the instrument<br />is prepaid and increase the potential for loss if the maturity of the instrument<br />is extended.<br /> <br />Real Estate-Related Investment Risk - investing in real estate-related securities <br />include risks related to general, regional and local economic conditions; <br />fluctuations in interest rates; property tax rates, zoning laws, environmental <br />regulations and other governmental action; cash flow dependency; increased <br />operating expenses; lack of availability of mortgage funds; losses due to <br />natural disasters; changes in property values and rental rates; and other factors.<br /> <br />Sector Risk - At times, the Fund may have a significant portion of its assets<br />invested in Underlying Funds that invest primarily in securities of companies<br />conducting business in a broadly related group of industries within an economic<br />sector. Companies in the same economic sector may be similarly affected by<br />economic or market events, making the Fund more vulnerable to unfavorable<br />developments in that economic sector than funds that invest more broadly.<br /><br />Short Sale Risk - the risk that the price of the security sold short will increase <br />in value between the time of the short sale and the time the Underlying Fund must <br />purchase the security and return it to the lender.<br /> <br />Small- and Mid-Cap Securities Risk - in general, stocks of small- and mid-cap<br />companies may be more volatile and less liquid than larger company stocks.<br /><br />Stock Market Risk - an Underlying Fund could lose value if the individual stocks<br />in which it invests or overall stock markets in which such stocks trade go down.<br /> <br />If the value of the Fund's investments goes down, you may lose money.<br /> <br />For additional information regarding the above identified risks, see "Fund Details: <br />Additional Information about Investments, Investment Techniques and Risks" in the<br />prospectus.</tt> Fees and Expenses of the Fund After-tax returns are shown in the following table for Class A shares only and will vary for other classes. Principal Strategies www.aberdeen-asset.us <tt>The Fund changed its investment objective and strategy effective September 24,<br />2012.&#xA0;&#xA0;Performance information for periods prior to September 24, 2012 does not<br />reflect the current investment strategy.&#xA0;&#xA0;In connection with the change of<br />investment objective and strategy, the Fund changed its name from Aberdeen<br />Optimal Allocations Fund: Moderate Growth to Aberdeen Dynamic Allocation Fund.<br />The returns presented for the Fund for periods prior to June 23, 2008 reflect<br />the performance of a predecessor fund (the "Predecessor Fund"), which was<br />acquired by the Fund. The Fund adopted the performance of the Predecessor Fund<br />as the result of a reorganization on June 23, 2008 in which the Fund acquired<br />all of the assets, subject to the liabilities, of the Predecessor Fund. The<br />investment objective and strategy of the Dynamic Allocation Fund, prior to the<br />recent changes noted above, and those of the Predecessor Fund, were<br />substantially similar.<br /> <br />The bar chart and table below can help you evaluate potential risks of the<br />Dynamic Allocation Fund. The bar chart shows how the Fund's annual total returns<br />for Class A have varied from year to year. The returns in the bar chart do not<br />reflect the impact of sales charges. If the applicable sales charges were<br />included, the annual total returns would be lower than those shown. The table<br />compares the Fund's average annual total returns to the returns of the S&amp;P 500<br />Index.&#xA0;&#xA0;Remember, however, that past performance (before and after taxes) is not<br />necessarily indicative of how the Fund will perform in the future.&#xA0;&#xA0;For updated<br />performance information, please visit www.aberdeen-asset.us or call<br />866-667-9231.</tt> <tt>This table describes the fees and expenses that you may pay when you buy and<br />hold shares of the Dynamic Allocation Fund. You may qualify for sales charge<br />discounts if you and your family invest, or agree to invest in the future, at<br />least $50,000 in Aberdeen Funds.&#xA0;&#xA0;More information about these and other<br />discounts is available from your financial advisor and in the "Investing with<br />Aberdeen Funds: Choosing a Share Class - Reduction and Waiver of Class A Sales<br />Charges" section on page 33 of the Fund's prospectus and in the "Additional<br />Information on Purchases and Sales" - "Waiver of Class A Sales Charges" and<br />"Reduction of Sales Charges" section on pages 90-92 of the Fund's Statement of<br />Additional Information.</tt> <div style="display:none">~ http://www.aberdeen-asset.us/role/OperatingExpensesData_S000020304Member column dei_LegalEntityAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> You would pay the following expenses on the same investment if you did not sell your shares: <div style="display:none">~ http://www.aberdeen-asset.us/role/PerformanceTableData_S000020304Member column dei_LegalEntityAxis compact * column rr_PerformanceMeasureAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> <tt>After-tax returns are shown in the following table for Class A shares only and<br />will vary for other classes. After-tax returns are calculated using the historical <br />highest individual federal marginal income tax rates in effect and do not reflect <br />state and local taxes. Your actual after-tax return depends on your personal tax <br />situation and may differ from what is shown here. After-tax returns are not <br />relevant to investors in tax-deferred arrangements, such as individual retirement <br />accounts, 401(k) plans or certain other employer-sponsored retirement plans.</tt> <div style="display:none">~ http://www.aberdeen-asset.us/role/ExpenseExampleNoRedemption_S000020304Member column dei_LegalEntityAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> <div style="display:none">~ http://www.aberdeen-asset.us/role/ShareholderFeesData_S000020304Member column dei_LegalEntityAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> S&P 500® Index (reflects no deduction for fees, expenses or taxes) 0.0211 -0.0025 0.0346 2004-06-29 Class A shares - After Taxes on Distributions and Sales of Shares -0.0185 0.0071 0.0401 2004-06-29 Class A shares - After Taxes on Distributions -0.0337 0.0031 0.0407 2009-06-29 GAASX 0.0000 Institutional Service Class shares - Before Taxes 117 417 -0.0047 1840 709 -0.0319 0.0062 0.0015 2014-02-27 0.0142 0.0000 0.0115 0.0162 0.0535 2004-06-29 0.0085 0.0000 GMMIX 0.0000 Institutional Class shares - Before Taxes 112 401 -0.0047 1785 764 -0.0319 0.0057 0.0015 2014-02-27 0.0142 0.0000 0.0110 0.0157 0.0535 2004-06-29 0.0085 0.0000 GAGRX 0.0000 Class R shares - Before Taxes 167 568 -0.0047 2365 1045 -0.0315 0.0061 0.0015 2014-02-27 0.0114 0.0050 0.0164 0.0211 0.0503 2004-06-29 0.0085 0.0000 GMMCX 0.0000 Class C shares - Before Taxes 313 213 708 -0.0047 2832 1279 -0.0363 0.0057 0.0015 2014-02-27 2832 0.0067 708 1279 0.0100 0.0210 0.0257 0.0457 2004-06-29 0.0085 0.0100 GMMAX Worst Quarter: Best Quarter: 0.0575 2012-06-30 Class A shares - Before Taxes 708 2009-06-30 1038 -0.1837 -0.0047 0.1277 2555 1438 0.1092 0.1683 -0.0285 0.0061 -0.3148 0.0015 2014-02-27 2008-12-31 0.2889 0.0142 0.0962 Year-to-Date Return -0.0285 0.0025 0.0139 0.0186 0.1419 0.0535 2004-06-29 0.1087 0.0085 0.0000 <tt>The Diversified Income Fund pays transaction costs, such as commissions, when it<br />buys and sells certain securities (or "turns over" its portfolio).&#xA0;&#xA0;A higher<br />portfolio turnover rate may indicate higher transaction costs and may result in<br />higher taxes when Fund shares are held in a taxable account.&#xA0;&#xA0;These costs, which<br />are not reflected in annual fund operating expenses or in the example, affect<br />the Fund's performance.&#xA0;&#xA0;During the most recent fiscal year, the Fund's portfolio <br />turnover rate was 26.55% of the average value of its portfolio.&#xA0;&#xA0;The Fund's <br />portfolio turnover rate for the current fiscal year is expected to be higher as a <br />result of purchases and sales of portfolio holdings made to realign the Fund's <br />portfolio with the investment strategy changes.</tt> <div style="display:none">~ http://www.aberdeen-asset.us/role/ExpenseExample_S000020303Member column dei_LegalEntityAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> <div style="display:none">~ http://www.aberdeen-asset.us/role/BarChartData_S000020303Member column dei_LegalEntityAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> <tt>The Aberdeen Diversified Income Fund (formerly, Aberdeen Optimal Allocations Fund: Moderate) <br />(the "Diversified Income Fund" or the "Fund") seeks total return with an emphasis on current <br />income.</tt> <tt>This Example is intended to help you compare the cost of investing in the<br />Diversified Income Fund with the cost of investing in other mutual funds.<br /><br />The Example assumes that you invest $10,000 in the Diversified Income Fund <br />for the time periods indicated and then sell all of your shares at the end <br />of those periods. It assumes a 5% return each year, no change in expenses <br />and the expense limitations (if applicable). Although your actual costs may <br />be higher or lower, based on these assumptions your costs would be:</tt> reflects no deduction for fees, expenses or taxes <tt>The Diversified Income Fund is a "fund of funds" that seeks to achieve its<br />investment objective by investing in underlying funds (the "Underlying Funds")<br />that provide exposure to a wide spectrum of asset classes. The Fund intends to<br />allocate and reallocate its assets among a range of asset classes in a flexible<br />and dynamic way to capture income from a number of fixed income, equity and<br />other sources. The types of asset classes to which the Underlying Funds provide<br />exposure include U.S. and international equities, U.S. and international bonds<br />(including emerging market bonds) and real estate. The Fund may also allocate<br />assets to a limited extent to Underlying Funds that pursue alternative investment <br />strategies, such as managed futures, commodity-linked instruments, equity sectors, <br />currencies and floating rate loans. The asset classes are selected primarily <br />based on their income-generating potential, without regard to the source of <br />income, although diversification benefits and potential for capital appreciation <br />may also be considered. The Fund may invest in Underlying Funds that do not have <br />income as an objective, and to the extent it does so, it will not generate as much <br />current income as a fund focused entirely on income-generation. The Underlying <br />Funds include, among others, mutual funds advised by Aberdeen Asset Management <br />Inc., the Fund's investment adviser (the "Adviser"), as well as unaffiliated mutual <br />funds and exchange-traded funds. There is no minimum or maximum amount of assets <br />that can be invested in affiliated Underlying Funds. The Underlying Funds may be <br />either actively managed or passively managed (that is, providing indexed exposures) <br />in nature. Some or all of the Underlying Funds may invest in derivatives.<br /><br />The Adviser develops strategic asset allocation views among broad asset classes<br />based on its ongoing analyses of global financial markets and macro-economic<br />conditions. The Fund's portfolio management team constructs the Fund's portfolio <br />by setting target asset class allocations for the Fund. The portfolio management <br />team then manages the Fund's portfolio by dynamically adjusting the Fund's asset <br />class allocations based on the Adviser's asset allocation views and selecting <br />Underlying Funds to obtain exposures to the asset classes.&#xA0;&#xA0;As part of its <br />process, the team evaluates the suitability of both active and passive vehicles <br />to provide exposure to each asset class. The target asset class allocations <br />established by the portfolio management team are intended to promote<br />diversification among the asset classes. The Fund's target and actual asset<br />class allocations and the Underlying Funds held in the Fund's portfolio are<br />monitored by the portfolio management team on an ongoing basis and are adjusted<br />periodically to reflect changes to the Adviser's views. The Fund retains the<br />flexibility to emphasize specific asset class allocations based on relative<br />valuations and other economic factors in order to seek to achieve the Fund's<br />objective. While the Fund will not invest more than 25% of its total assets in<br />any one Underlying Fund, the Fund may have significant exposure to one or more<br />asset classes depending on market conditions. The Fund has the ability to<br />invest, through the Underlying Funds, in small, medium or large capitalization<br />issuers without regard to credit quality (including high yield bonds, which are<br />commonly known as "junk bonds") or geographic location, and is not limited by<br />industry sector or the duration of individual instruments or the portfolio as a<br />whole. At times, the Fund may emphasize any one of these exposures. Asset<br />classes may be added or removed at the Adviser's discretion.<br /><br />For additional information regarding the above identified strategies, see "Fund<br />Details: Additional Information about Principal Strategies" in the prospectus.</tt> Aberdeen Diversified Income Fund (formerly, Aberdeen Optimal Allocations Fund: Moderate) You may qualify for sales charge discounts if you and your family invest, or agree to invest in the future, at least $50,000 in Aberdeen Funds. Example After-tax returns are calculated using the historical highest individual federal marginal income tax rates in effect and do not reflect state and local taxes. Objective Remember, however, that past performance (before and after taxes) is not necessarily indicative of how the Fund will perform in the future. If the value of the Fund's investments goes down, you may lose money. "Acquired fund fees and expenses" are based on the estimated composition of the Fund for the upcoming year. Principal Risks Shareholder Fees (fees paid directly from your investment) 0.2655 Your actual after-tax return depends on your personal tax situation and may differ from what is shown here. After-tax returns are not relevant to investors in tax-deferred arrangements, such as individual retirement accounts, 401(k) plans or certain other employer-sponsored retirement plans. Annual Total Returns - Class A Shares (Years Ended Dec. 31) Performance 50000 The bar chart and table below can help you evaluate potential risks of the Diversified Income Fund. <tt>Best Quarter:&#xA0;&#xA0;13.37% - 2nd quarter 2009<br /><br />Worst Quarter:&#xA0;&#xA0;-12.61% - 3rd quarter 2008<br /><br />Year-to-Date Return as of June 30, 2012: 9.82%</tt> 866-667-9231 Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment) Average Annual Total Returns as of December 31, 2011 Portfolio Turnover <tt>The Diversified Income Fund cannot guarantee that it will achieve its investment<br />objective.<br /><br />As with any fund, the value of the Fund's investments - and therefore, the value<br />of Fund shares - may fluctuate. These changes may occur because of:<br /><br />Affiliated Funds Risk - The Fund's Adviser serves as the adviser of certain<br />Underlying Funds. It is possible that a conflict of interest among the Fund and<br />the Underlying Funds could affect how the Fund's Adviser fulfills its fiduciary<br />duties to the Fund and the Underlying Funds.<br /><br />Asset Allocation Risk - The Fund is subject to different levels and combinations<br />of risk, based on its actual allocation among the various asset classes and<br />Underlying Funds.&#xA0;&#xA0;The Fund will be exposed to risks of the Underlying Funds in<br />which it invests. The Fund will be affected by stock and bond market risks,<br />among others.&#xA0;&#xA0;To the extent the Fund invests in Underlying Funds that expose it<br />to non-traditional or alternative asset classes (which include investments that<br />focus on a specialized asset class (e.g. long-short strategies) as well as<br />specific market sectors within a broader asset class), the Fund will be exposed<br />to the increased risk associated with those asset classes.&#xA0;&#xA0;The potential impact<br />of the risks related to an asset class depends on the size of Fund's investment<br />allocation to it.<br /> <br />Asset Class Variation Risk - The Underlying Funds invest principally in the<br />securities or investments constituting their asset class. However, under normal<br />market conditions, an Underlying Fund may vary the percentage of its assets in<br />these securities or investments (subject to any applicable regulatory requirements). <br />Depending upon the percentage of securities or investments in a particular asset <br />class held by the Underlying Funds at any given time and the percentage of the <br />Fund's assets invested in various Underlying Funds, the Fund's actual exposure <br />to the securities or investments in a particular asset class may vary <br />substantially from its allocation model for that asset class.<br /><br />Fund of Funds Risk - Your cost of investing in the Fund, as a fund of funds, may<br />be higher than the cost of investing in a mutual fund that only invests directly<br />in individual securities. An Underlying Fund may change its investment objective<br />or policies without the Fund's approval, which could force the Fund to withdraw<br />its investment from such Underlying Fund at a time that is unfavorable to the<br />Fund. In addition, one Underlying Fund may buy the same securities that another<br />Underlying Fund sells. Therefore, the Fund would indirectly bear the costs of<br />these trades without accomplishing any investment purpose.<br /><br />Performance Risk - The Fund's investment performance is directly tied to the<br />performance of the Underlying Funds in which the Fund invests. If one or more<br />of the Underlying Funds fails to meet its investment objective, the Fund's<br />performance could be negatively affected. There can be no assurance that the<br />Fund or any Underlying Fund will achieve its investment objective.<br /> <br />Redemption Fee Risk - Certain unaffiliated Underlying Funds may charge redemption <br />fees to shareholders who redeem their Underlying Fund shares within a specified <br />period of time following the purchase of such shares.<br /> <br />Ordinarily, a mutual fund that imposes redemption fees does so in order to deter<br />investors from engaging in excessive or short-term trading, often referred to as<br />"market timing," and to reimburse it for transaction costs borne by other fund<br />shareholders on account of market timing activity. The Fund does not intend to<br />engage in market timing in Underlying Fund shares. However, the Fund will place<br />purchase and redemption orders in shares of Underlying Funds pursuant to an<br />established asset allocation model in response to daily purchases and<br />redemptions of the Fund's own shares, to conduct periodic rebalancing of the<br />Fund's assets to conform to the established model following periods of market<br />fluctuation, and in response to changes made to an existing asset allocation<br />model itself.&#xA0;&#xA0;While the portfolio managers will attempt to conduct the Fund's<br />purchase and redemption of Underlying Fund shares in a manner to avoid or<br />minimize subjecting the Fund to redemption fees, there may be instances where<br />payment of such fees is unavoidable or the portfolio managers are not successful<br />in minimizing their impact.<br /> <br />Principal Risks of Underlying Funds<br /><br />Alternative Strategies Risk - The performance of Underlying Funds that pursue<br />alternative strategies is linked to the performance of highly volatile<br />alternative asset classes (e.g., commodities and currencies) and alternative<br />strategies (e.g., managed futures). To the extent the Fund invests in such<br />Underlying Funds, the Fund's share price will be exposed to potentially<br />significant fluctuations in value. In addition, Underlying Funds that employ<br />alternative strategies have the risk that anticipated opportunities do not play<br />out as planned, resulting in potentially substantial losses to the Underlying<br />Fund. Furthermore, alternative strategies may employ leverage, involve extensive <br />short positions and/or focus on narrow segments of the market, which may magnify <br />the overall risks and volatility associated with such Underlying Funds' <br />investments. Depending on the particular alternative strategies used by an <br />Underlying Fund, it may be subject to risks not associated with more traditional <br />investments. These risks may include, but are not limited to, derivatives risk, <br />liquidity risk, credit risk, commodity risk and counterparty risk.<br />&#xA0;&#xA0;<br />Counterparty and Third Party Risk - transactions involving a counterparty or<br />third party (other than the issuer of the instrument) are subject to the<br />counterparty's or third party's credit risk and ability to perform in accordance<br />with the terms of the transaction.<br /> <br />Credit Risk - a debt instrument's price depends, in part, on the credit quality<br />of the issuer, borrower, counterparty, or underlying collateral and can decline<br />in response to changes in the financial condition of the issuer, borrower,<br />counterparty, or underlying collateral, or changes in specific or general market, <br />economic, industry, political, regulatory, geopolitical, or other conditions. <br />High yield bonds ("junk bonds") may be subject to an increased risk of default, <br />a more limited secondary market than investment grade bonds, and greater price <br />volatility.<br /> <br />Currency Risk - the value of foreign currencies relative to the U.S. dollar<br />fluctuates in response to market, economic, political, regulatory, geopolitical<br />or other conditions. A decline in the value of a foreign currency versus the<br />U.S. dollar reduces the value in U.S. dollars of investments denominated in that<br />foreign currency.<br /> <br />Derivatives Risk - derivatives can be highly volatile and involve risks in<br />addition to the risks of the underlying security. Gains or losses from derivatives <br />can be substantially greater than the derivatives' original cost and can involve <br />leverage.<br /><br />Floating Rate Loan Risk - Floating rate loans generally are subject to restrictions <br />on resale. Floating rate loans sometimes trade infrequently in the secondary market. <br />As a result, valuing a floating rate loan can be more difficult, and buying and <br />selling a floating rate loan at an acceptable price can be more difficult or delayed. <br />Difficulty in selling a floating rate loan can result in a loss. In addition, a <br />floating rate loan may not be fully collateralized which may cause the floating rate <br />loan to decline significantly in value.<br /> <br />Foreign and Emerging Markets Risk - foreign securities can involve risks relating <br />to market, economic, political, regulatory, geopolitical, or other conditions and <br />may be more volatile, harder to price and less liquid than U.S. securities.&#xA0;&#xA0;These <br />risks are greater for securities of companies in emerging markets countries.<br /> <br />Inflation-Adjusting Risk - interest payments on inflation-adjusted debt instruments <br />can be unpredictable and vary based on the level of inflation. If inflation is negative, <br />principal and income can both decline.<br /><br />Interest Rate Risk - changes in interest rates may cause a decline in the market <br />value of an investment. With bonds and other fixed-income securities, a rise in interest <br />rates typically causes a fall in values.<br /> <br />Leveraging Risk - the use of leverage may exaggerate changes in the net asset value <br />of Underlying Fund shares and thus result in increased volatility of returns.<br /> <br />Liquidity Risk - it may not be possible to sell certain investments, types of investments, <br />and/or segments of the market at any particular time or at an acceptable price.<br /> <br />Prepayment/Extension Risk - instruments subject to prepayment and/or extension can <br />reduce the potential for gain for the instrument's holders if the instrument is <br />prepaid and increase the potential for loss if the maturity of the instrument is <br />extended.<br /> <br />Real Estate-Related Investment Risk - investing in real estate-related securities <br />include risks related to general, regional and local economic conditions; fluctuations <br />in interest rates; property tax rates, zoning laws, environmental regulations and other <br />governmental action; cash flow dependency; increased operating expenses; lack of <br />availability of mortgage funds; losses due to natural disasters; changes in property <br />values and rental rates; and other factors.<br /><br />Sector Risk - At times, the Fund may have a significant portion of its assets invested <br />in Underlying Funds that invest primarily in securities of companies conducting business <br />in a broadly related group of industries within an economic sector. Companies in the <br />same economic sector may be similarly affected by economic or market events, making the <br />Fund more vulnerable to unfavorable developments in that economic sector than funds that <br />invest more broadly<br /> <br />Short Sale Risk - the risk that the price of the security sold short will increase in <br />value between the time of the short sale and the time the Underlying Fund must purchase <br />the security and return it to the lender.<br /> <br />Small- and Mid-Cap Securities Risk - in general, stocks of small- and mid-cap companies <br />may be more volatile and less liquid than larger company stocks.<br /> <br />Stock Market Risk - an Underlying Fund could lose value if the individual stocks in <br />which it invests or overall stock markets in which such stocks trade go down.<br /><br />If the value of the Fund's investments goes down, you may lose money.<br /> <br />For additional information regarding the above identified risks, see "Fund Details: <br />Additional Information about Investments, Investment Techniques and Risks" in the<br />prospectus.</tt> Fees and Expenses of the Fund After-tax returns are shown in the following table for Class A shares only and will vary for other classes. Principal Strategies www.aberdeen-asset.us <tt>The Fund changed its investment objective and strategy effective September 24,<br />2012. Performance information for periods prior to September 24, 2012 does not<br />reflect the current investment strategy.&#xA0;&#xA0;In connection with the change in<br />investment objective and strategy, the Fund changed its name from Aberdeen<br />Optimal Allocations Fund: Moderate to Aberdeen Diversified Income Fund. The<br />returns presented for the Fund for periods prior to June 23, 2008 reflect the<br />performance of a predecessor fund (the "Predecessor Fund"), which was acquired<br />by the Fund. The Fund adopted the performance of the Predecessor Fund as the<br />result of a reorganization on June 23, 2008 in which the Fund acquired all of<br />the assets, subject to the liabilities, of the Predecessor Fund. The investment<br />objective and strategy of the Fund, prior to the recent changes noted above, and<br />those of the Predecessor Fund, were substantially similar.<br /><br />The bar chart and table below can help you evaluate potential risks of the<br />Diversified Income Fund. The bar chart shows how the Fund's annual total returns<br />for Class A have varied from year to year. The returns in the bar chart do not<br />reflect the impact of sales charges. If the applicable sales charges were<br />included, the annual total returns would be lower than those shown. The table<br />compares the Fund's average annual total returns to the returns of the Barclays<br />U.S. Aggregate Bond Index and of the S&amp;P 500 Index. Effective September 24,<br />2012, the Barclays U.S. Aggregate Bond Index replaced the S&amp;P 500 Index as the<br />Fund's benchmark as a result of a change in the investment objective and<br />strategy of the Fund. The Adviser believes that the composition of the Barclays<br />U.S. Aggregate Bond Index makes a more meaningful comparison index given the<br />Fund's current investment objective and strategy. Remember, however, that past<br />performance (before and after taxes) is not necessarily indicative of how the<br />Fund will perform in the future. For updated performance information, please<br />visit www.aberdeen-asset.us or call 866-667-9231.</tt> <tt>This table describes the fees and expenses that you may pay when you buy and<br />hold shares of the Diversified Income Fund.&#xA0;&#xA0;You may qualify for sales charge<br />discounts if you and your family invest, or agree to invest in the future, at<br />least $50,000 in Aberdeen Funds.&#xA0;&#xA0;More information about these and other<br />discounts is available from your financial advisor and in the "Investing with<br />Aberdeen Funds: Choosing a Share Class - Reduction and Waiver of Class A Sales<br />Charges" section on page 33 of the Fund's prospectus and in the "Additional<br />Information on Purchases and Sales" - "Waiver of Class A Sales Charges" and<br />"Reduction of Sales Charges" section on pages 90-92 of the Fund's Statement of<br />Additional Information.</tt> <div style="display:none">~ http://www.aberdeen-asset.us/role/OperatingExpensesData_S000020303Member column dei_LegalEntityAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> You would pay the following expenses on the same investment if you did not sell your shares: <div style="display:none">~ http://www.aberdeen-asset.us/role/PerformanceTableData_S000020303Member column dei_LegalEntityAxis compact * column rr_PerformanceMeasureAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> <tt>After-tax returns are shown in the following table for Class A shares only and<br />will vary for other classes. After-tax returns are calculated using the historical <br />highest individual federal marginal income tax rates in effect and do not reflect <br />state and local taxes. Your actual after-tax return depends on your personal tax <br />situation and may differ from what is shown here. After-tax returns are not <br />relevant to investors in tax-deferred arrangements, such as individual retirement <br />accounts, 401(k) plans or certain other employer-sponsored retirement plans.</tt> <div style="display:none">~ http://www.aberdeen-asset.us/role/ExpenseExampleNoRedemption_S000020303Member column dei_LegalEntityAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> <div style="display:none">~ http://www.aberdeen-asset.us/role/ShareholderFeesData_S000020303Member column dei_LegalEntityAxis compact * column rr_ProspectusShareClassAxis compact * row primary compact * ~</div> Barclays U.S. Aggregate Bond Index (reflects no deduction for fees, expenses or taxes) 0.0784 0.0650 0.0709 2004-06-29 S&P 500® Index (reflects no deduction for fees, expenses or taxes) 0.0211 -0.0025 0.0350 2004-06-29 Class A shares - After Taxes on Distributions and Sales of Shares -0.0072 0.0181 0.0432 2004-06-29 Class A shares - After Taxes on Distributions -0.0176 0.0164 0.0449 2004-06-29 GAMSX 0.0000 Institutional Service Class shares - Before Taxes 106 375 -0.0040 1453 709 -0.0091 0.0055 0.0015 2014-02-27 0.0301 0.0000 0.0104 0.0144 0.0595 2004-06-29 0.0074 0.0000 GMAIX 0.0000 Institutional Class shares - Before Taxes 101 359 -0.0040 1597 682 -0.0091 0.0050 0.0015 2014-02-27 0.0301 0.0000 0.0099 0.0139 0.0595 2004-06-29 0.0074 0.0000 GMRRX 0.0000 Class R shares - Before Taxes 164 551 -0.0040 2271 1007 -0.0161 0.0062 0.0015 2014-02-27 0.0249 0.0050 0.0161 0.0201 0.0538 2004-06-29 0.0074 0.0000 GMACX 0.0000 Class C shares - Before Taxes 302 202 667 -0.0040 2663 1201 -0.0195 0.0050 0.0015 2014-02-27 2663 0.0201 667 1201 0.0100 0.0199 0.0239 0.0492 2004-06-29 0.0074 0.0100 GMAAX Worst Quarter: Best Quarter: 0.0575 2012-06-30 Class A shares - Before Taxes 697 2009-06-30 996 -0.1261 -0.0040 0.1075 2373 1357 0.0946 0.1337 -0.0112 0.0053 -0.2264 0.0015 2014-02-27 2008-09-30 0.2364 0.0277 0.0769 Year-to-Date Return -0.0112 0.0025 0.0127 0.0167 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otherwise eligible to purchase Class A shares without a sales charge, a contingent deferred sales charge (CDSC) of up to 1.00% will be charged on Class A shares redeemed within 18 months of purchase if you paid no sales charge on the original purchase and a finder's fee was paid. "Acquired fund fees and expenses" are based on the estimated composition of the Fund for the upcoming year. Aberdeen Funds (the "Trust") and Aberdeen Asset Management Inc. (the "Adviser") have entered into a written contract limiting operating expenses to 0.25% for all Classes of the Fund at least through February 27, 2014. This limit excludes certain expenses, including any taxes, interest, brokerage fees, short-sale dividend expenses, Acquired Fund Fees and Expenses, 12b-1 fees, administrative services fees and extraordinary expenses. The Trust is authorized to reimburse the Adviser for management fees previously limited and/or for expenses previously paid by the Adviser, provided, however, that any reimbursements must be paid at a date not more than three years after the date when the Adviser limited the fees or reimbursed the expenses and the reimbursements do not cause a Class to exceed the applicable expense limitation in the contract at the time the fees were limited or expenses are paid. This contract may not be terminated before February 27, 2014.