UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER
REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number: | 811-21335 | |
Exact name of registrant as specified in charter: | Optimum Fund Trust | |
Address of principal executive offices: | 2005 Market Street | |
Philadelphia, PA 19103 | ||
Name and address of agent for service: | David F. Connor, Esq. | |
2005 Market Street | ||
Philadelphia, PA 19103 | ||
Registrants telephone number, including area code: | (800) 523-1918 | |
Date of fiscal year end: | March 31 | |
Date of reporting period: | March 31, 2017 |
Item 1. Reports to Stockholders
Optimum Fixed Income Fund
Optimum International Fund
Optimum Large Cap Growth Fund
Optimum Large Cap Value Fund
Optimum Small-Mid Cap Growth Fund
Optimum Small-Mid Cap Value Fund
Annual report
March 31, 2017
Carefully consider the Funds investment objectives, risk factors, charges, and expenses before investing. This and other information can be found in the Funds prospectus and, if available, their summary prospectuses, which may be obtained by visiting optimummutualfunds.com/literature or calling 800 914-0278. Investors should read the prospectus and, if available, the summary prospectus carefully before investing.
1 | ||||
4 | ||||
7 | ||||
10 | ||||
13 | ||||
16 | ||||
19 | ||||
23 | ||||
26 | ||||
29 | ||||
32 | ||||
35 | ||||
38 | ||||
Security type / sector / country allocations |
40 | |||
Financial statements |
||||
45 | ||||
112 | ||||
115 | ||||
117 | ||||
120 | ||||
138 | ||||
167 | ||||
168 | ||||
171 | ||||
173 |
Neither Delaware Investments nor its affiliates referred to in this document are authorized deposit-taking institutions for the purposes of the Banking Act 1959 (Commonwealth of Australia). The obligations of these entities do not represent deposits or other liabilities of Macquarie Bank Limited (MBL), a subsidiary of Macquarie Group Limited and an affiliate of Delaware Investments. MBL does not guarantee or otherwise provide assurance in respect of the obligations of these entities, unless noted otherwise. The Funds are governed by US laws and regulations.
Unless otherwise noted, views expressed herein are current as of March 31, 2017, and subject to change for events occurring after such a date. Holdings are as of the date indicated and subject to change.
The Funds are not FDIC insured and are not guaranteed. It is possible to lose the principal amount invested.
Mutual fund advisory services provided by Delaware Management Company, a series of Delaware Management Business Trust, which is a registered investment advisor. Delaware Investments, a member of Macquarie Group, refers to Delaware Management Holdings, Inc. and its subsidiaries, including the Funds distributor, Delaware Distributors, L.P. Macquarie Group refers to Macquarie Group Limited and its subsidiaries and affiliates worldwide.
All third-party marks cited are the property of their respective owners.
© 2017 Delaware Management Holdings, Inc.
April 11, 2017 (Unaudited)
Performance review (for the year ended March 31, 2017) |
||||||
Optimum Fixed Income Fund (Institutional Class shares) |
1-year return | +2.40% | ||||
Optimum Fixed Income Fund (Class A shares) |
1-year return | +2.03% | ||||
Bloomberg Barclays US Aggregate Index* (benchmark) |
1-year return | +0.44% |
Past performance does not guarantee future results.
For complete, annualized performance for Optimum Fixed Income Fund, please see the table on page 19.
Institutional Class shares are available without sales or asset-based distribution charges only to certain eligible institutional accounts. The performance of Class A shares excludes the applicable sales charge. Both Institutional Class shares and Class A shares reflect the reinvestment of all distributions.
Please see page 21 for a description of the index. Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index.
*Formerly, the Barclays US Aggregate Index.
(continues) | 1 |
Portfolio management reviews
Optimum Fixed Income Fund
2 |
(continues) | 3 |
Portfolio management reviews
April 11, 2017 (Unaudited)
Performance review (for the year ended March 31, 2017) | ||||||
Optimum International Fund (Institutional Class shares)* |
1-year return | +14.18% | ||||
Optimum International Fund (Class A shares)* |
1-year return | +13.91% | ||||
MSCI EAFE Index (gross) (benchmark) |
1-year return | +12.25% | ||||
MSCI EAFE Index (net) (benchmark) |
1-year return | +11.67% |
Past performance does not guarantee future results.
For complete, annualized performance for Optimum International Fund, please see the table on page 23.
Institutional Class shares are available without sales or asset-based distribution charges only to certain eligible institutional accounts. The performance of Class A shares excludes the applicable sales charge. Both Institutional Class shares and Class A shares reflect the reinvestment of all distributions.
Please see page 24 for a description of the index. Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index.
*Total returns for the report period presented in the table differ from the returns in Financial highlights. The total returns presented in the above table are calculated based on the net asset value (NAV) at which shareholder transactions were processed. The total returns presented in Financial highlights are calculated in the same manner, but also take into account certain adjustments that are necessary under US generally accepted accounting principles (US GAAP) required in the annual report.
4 |
(continues) | 5 |
Portfolio management reviews
Optimum International Fund
6 |
April 11, 2017 (Unaudited)
Performance review (for the year ended March 31, 2017) |
||||||
Optimum Large Cap Growth Fund (Institutional Class shares) |
1-year return | +17.14% | ||||
Optimum Large Cap Growth Fund (Class A shares) |
1-year return | +16.83% | ||||
Russell 1000® Growth Index (benchmark) |
1-year return | +15.76% |
Past performance does not guarantee future results.
For complete, annualized performance for Optimum Large Cap Growth Fund, please see the table on page 26.
Institutional Class shares are available without sales or asset-based distribution charges only to certain eligible institutional accounts. The performance of Class A shares excludes the applicable sales charge. Both Institutional Class shares and Class A shares reflect the reinvestment of all distributions.
Please see page 27 for a description of the index. Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index.
(continues) | 7 |
Portfolio management reviews
Optimum Large Cap Growth Fund
8 |
(continues) | 9 |
Portfolio management reviews
April 11, 2017 (Unaudited)
Performance review (for the year ended March 31, 2017) |
||||||
Optimum Large Cap Value Fund (Institutional Class shares) |
1-year return | +15.30% | ||||
Optimum Large Cap Value Fund (Class A shares) |
1-year return | +14.99% | ||||
Russell 1000® Value Index (benchmark) |
1-year return | +19.22% |
Past performance does not guarantee future results.
For complete, annualized performance for Optimum Large Cap Value Fund, please see the table on page 29.
Institutional Class shares are available without sales or asset-based distribution charges only to certain eligible institutional accounts. The performance of Class A shares excludes the applicable sales charge. Both Institutional Class shares and Class A shares reflect the reinvestment of all distributions.
Please see page 30 for a description of the index. Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index.
10 |
(continues) | 11 |
Portfolio management reviews
Optimum Large Cap Value Fund
12 |
Optimum Small-Mid Cap Growth Fund
April 11, 2017 (Unaudited)
Performance review (for the year ended March 31, 2017) |
||||||
Optimum Small-Mid Cap Growth Fund (Institutional Class shares) |
1-year return | +21.80% | ||||
Optimum Small-Mid Cap Growth Fund (Class A shares) |
1-year return | +21.55% | ||||
Russell 2500 Growth Index (benchmark) |
1-year return | +19.77% |
Past performance does not guarantee future results.
For complete, annualized performance for Optimum Small-Mid Cap Growth Fund, please see the table on page 32.
Institutional Class shares are available without sales or asset-based distribution charges only to certain eligible institutional accounts. The performance of Class A shares excludes the applicable sales charge. Both Institutional Class shares and Class A shares reflect the reinvestment of all distributions.
Please see page 33 for a description of the index. Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index.
(continues) | 13 |
Portfolio management reviews
Optimum Small-Mid Cap Growth Fund
14 |
(continues) | 15 |
Portfolio management reviews
Optimum Small-Mid Cap Value Fund
April 11, 2017 (Unaudited)
Performance review (for the year ended March 31, 2017) |
||||||
Optimum Small-Mid Cap Value Fund (Institutional Class shares) |
1-year return | +20.05% | ||||
Optimum Small-Mid Cap Value Fund (Class A shares) |
1-year return | +19.84% | ||||
Russell 2500 Value Index (benchmark) |
1-year return | +23.13% |
Past performance does not guarantee future results.
For complete, annualized performance for Optimum Small-Mid Cap Value Fund please see the table on page 35.
Institutional Class shares are available without sales or asset-based distribution charges only to certain eligible institutional accounts. The performance of Class A shares excludes the applicable sales charge. Both Institutional Class shares and Class A shares reflect the reinvestment of all distributions.
Please see page 36 for a description of the index. Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index.
16 |
(continues) | 17 |
Portfolio management reviews
Optimum Small-Mid Cap Value Fund
18 |
Optimum Fixed Income Fund | March 31, 2017 | |
(Unaudited) |
The performance data quoted represent past performance; past performance does not guarantee future results. Investment return and principal value will fluctuate so your shares, when redeemed, may be worth more or less than their original cost. Please obtain the performance data for the most recent month end by calling 800 914-0278 or visiting our website at optimummutualfunds.com/performance. Current performance may be lower or higher than the performance data quoted.
Fund and benchmark performance1,2 | ||||||
Average annual total returns through March 31, 2017 | 1 year | 5 years | 10 years | |||
Class A (Est. Aug. 1, 2003) |
||||||
Excluding sales charge |
+2.03% | +1.90% | +4.41% | |||
Including sales charge |
-2.55% | +0.96% | +3.92% | |||
Class C (Est. Aug. 1, 2003) |
||||||
Excluding sales charge |
+1.27% | +1.15% | +3.70% | |||
Including sales charge |
+0.27% | +1.15% | +3.70% | |||
Institutional Class (Est. Aug. 1, 2003) |
||||||
Excluding sales charge |
+2.40% | +2.18% | +4.73% | |||
Including sales charge |
+2.40% | +2.18% | +4.73% | |||
Bloomberg Barclays US Aggregate Index |
+0.44% | +2.34% | +4.27% |
1Returns reflect the reinvestment of all distributions and are presented both with and without the applicable sales charges described below. Returns do not reflect the deduction of taxes the shareholder would pay on Fund distributions or redemptions of Fund shares.
Expense limitations were in effect for certain classes during some or all of the periods shown in the Fund and benchmark performance graph. The current expenses for each class are listed on the Fund expense ratios table below. Performance would have been lower had expense limitations not been in effect.
Institutional Class shares are available without sales or asset-based distribution charges only to certain eligible institutional accounts.
Class A shares are sold with a maximum front-end sales charge of 4.50%, and have an annual distribution and service fee of 0.25% of average daily net assets. Performance for Class A shares, excluding sales charges, assumes that no front-end sales charge applied.
Class C shares are sold with a contingent deferred sales charge of 1.00% if redeemed during the first 12 months. They are also subject to an annual distribution and service fee of 1.00% of average daily net assets.
Performance for Class C shares, excluding sales charges, assumes either that contingent deferred sales charges did not apply or that the investment was not redeemed.
The Fund and benchmark performance table and the Performance of a $10,000 investment graph do not reflect the deduction of taxes the shareholder would pay on Fund distributions or redemptions of Fund shares.
2 The Funds expense ratios, as described in the most recent prospectus, are disclosed in the Fund expense ratios table on the next page. Delaware Management Company has agreed to reimburse certain expenses and/or waive certain fees in order to prevent total fund operating expenses (excluding any 12b-1 fees and certain other expenses) from exceeding 0.92% of the Funds average daily net assets from April 1, 2016, through March 31, 2017.* Please see the most recent prospectus and any applicable supplement(s) for additional information on these fee waivers and/or reimbursements.
(continues) | 19 |
Performance summaries
Optimum Fixed Income Fund
Fund expense ratios | Class A | Class C | Institutional Class | |||
Total annual operating expenses (without fee waivers) |
1.17% |
1.92% |
0.92% | |||
Net expenses (including fee waivers, if any) |
1.17% |
1.92% |
0.92% | |||
Type of waiver |
Contractual | Contractual | Contractual |
* The aggregate contractual waiver period covering this report is from July 29, 2015 to July 29, 2017.
Fixed income securities and bond funds can lose value, and investors can lose principal, as interest rates rise. They also may be affected by economic conditions that hinder an issuers ability to make interest and principal payments on its debt.
The Fund may also be subject to prepayment risk, the risk that the principal of a bond that is held by a portfolio will be prepaid prior to maturity, at the time when interest rates are lower than what the bond was paying. A portfolio may then have to reinvest that money at a lower interest rate.
Securities in the lowest of the rating categories considered to be investment grade (that is, Baa or BBB) have some speculative characteristics.
High yielding, non-investment-grade bonds (junk bonds) involve higher risk than investment grade bonds.
The high yield secondary market is particularly susceptible to liquidity problems when institutional investors, such as mutual funds and certain other financial institutions, temporarily stop buying bonds for regulatory, financial, or other reasons. In addition, a less liquid secondary market makes it more difficult for the Fund to obtain precise valuations of the high yield securities in its portfolio.
If and when we invest in forward foreign currency contracts or use other investments to hedge against currency risks, the Fund will be subject to special risks, including counterparty risk.
The Fund may invest in derivatives, which may involve additional expenses and are subject to risk, including the risk that an underlying security or securities index moves in the opposite direction from what the portfolio manager anticipated. A derivatives transaction depends upon the counterparties ability to fulfill their contractual obligations.
Portfolio turnover is a measure of how frequently the managers buy and sell assets within a fund over a particular period. It is usually reported for a 12-month time period.
20 |
Performance of a $10,000 Investment1
Average annual total returns from March 31, 2007 through March 31, 2017
1The Performance of $10,000 investment graph assumes $10,000 invested in Class A and Institutional Class shares of the Fund on March 31, 2007, and includes the effect of a 4.50% front-end sales charge (for Class A shares) and the reinvestment of all distributions. The graph does not reflect the deduction of taxes the shareholders would pay on Fund distributions or redemptions of Fund shares. Expense limitations were in effect for some or all of the periods shown. Performance would have been lower had expense limitations not been in effect. Current expenses are listed in the Fund expense ratios table on page 20. Please note additional details on pages 19 through 22.
The graph also assumes $10,000 invested in the Bloomberg Barclays US Aggregate Index as of March 31, 2007. The Bloomberg Barclays US Aggregate Index (formerly known as the Barclays US Aggregate Index) measures the performance of publicly issued investment grade (Baa3/ BBB- or better) corporate, US government, mortgage- and asset-backed securities with at least one year to maturity and at least $250 million par amount outstanding.
The S&P/LSTA (Loan Syndications and Trading Association) Leveraged Loan Index, mentioned on page 2, is a broad index designed to reflect the market-value-weighted performance of US dollar-denominated institutional leveraged loans.
The BofA Merrill Lynch BB-B US High Yield Index, mentioned on page 2, tracks the performance of US dollar-denominated high yield corporate debt rated BB1 through B3 publicly issued in the US domestic market.
The Bloomberg Barclays US Mortgage-Backed Securities (MBS) Index, mentioned on pages 1 and 2, measures the performance of agency mortgage-backed pass-through securities (both fixed-rate and hybrid adjustable-rate mortgage) issued by the Federal National Mortgage Association (Fannie Mae), Federal Home Loan Mortgage Association (Freddie Mac), and Government National Mortgage Association (Ginnie Mae).
The BofA Merrill Lynch US Dollar 3-Month Deposit Offered Rate Constant Maturity Index, mentioned on pages 1 and 2, represents the London interbank offered rate (Libor) with a constant 3-month average maturity. Libor, published by the British Bankers Association, is a composite of the rates of interest at which banks borrow from one another in the London market, and it is a widely used benchmark for short-term interest rates.
The BofA Merrill Lynch 13 Year US Treasury Index, mentioned on pages 1 and 3, is composed of US Treasury notes and bonds with maturities of at least one year but less than three years. It does not include inflation-linked US government bonds.
Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index. Past performance is not a guarantee of future results.
(continues) | 21 |
Performance summaries
Optimum Fixed Income Fund
Performance of other Fund classes will vary due to different charges and expenses.
Stock symbols and CUSIP numbers | ||||
Nasdaq symbols | CUSIPs | |||
Class A | OAFIX | 246118681 | ||
Class C | OCFIX | 246118665 | ||
Institutional Class | OIFIX | 246118657 |
22 |
Optimum International Fund | March 31, 2017 | |
(Unaudited) |
The performance data quoted represent past performance; past performance does not guarantee future results. Investment return and principal value will fluctuate so your shares, when redeemed, may be worth more or less than their original cost. Please obtain the performance data for the most recent month end by calling 800 914-0278 or visiting our website at optimummutualfunds.com/performance. Current performance may be lower or higher than the performance data quoted.
Fund and benchmark performance1,2 | ||||||
Average annual total returns through March 31, 2017 | 1 year | 5 years | 10 years | |||
Class A (Est. Aug. 1, 2003) |
||||||
Excluding sales charge |
+13.91%* | +4.68% | +0.10% | |||
Including sales charge |
+7.34%* | +3.44% | 0.49% | |||
Class C (Est. Aug. 1, 2003) |
||||||
Excluding sales charge |
+13.07%* | +3.92% | 0.59% | |||
Including sales charge |
+12.07%* | +3.92% | 0.59% | |||
Institutional Class (Est. Aug. 1, 2003) |
||||||
Excluding sales charge |
+14.18%* | +4.97% | +0.42% | |||
Including sales charge |
+14.18%* | +4.97% | +0.42% | |||
MSCI EAFE Index (gross) |
+12.25% | +6.32% | +1.53% | |||
MSCI EAFE Index (net) |
+11.67% | +5.83% | +1.05% |
*Total returns for the report period presented in the table differ from the returns in Financial highlights. The total returns presented in the above table are calculated based on the net asset value (NAV) at which shareholder transactions were processed. The total returns presented in Financial highlights are calculated in the same manner, but also take into account certain adjustments that are necessary under US generally accepted accounting principles (US GAAP) required in the annual report.
1Returns reflect the reinvestment of all distributions and are presented both with and without the applicable sales charges described below. Returns do not reflect the deduction of taxes the shareholder would pay on Fund distributions or redemptions of Fund shares.
Expense limitations were in effect for certain classes during some or all of the periods shown in the Fund and benchmark performance graph. The current expenses for each class are listed on the Fund expense ratios table below. Performance would have been lower had expense limitations not been in effect.
Institutional Class shares are available without sales or asset-based distribution charges only to certain eligible institutional accounts.
Class A shares are sold with a maximum front-end sales charge of up to 5.75%, and have an annual distribution and service fee of up to 0.25% of average daily net assets. Performance for Class A shares, excluding sales charges, assumes that no front-end sales charge applied.
Class C shares are sold with a contingent deferred sales charge of 1.00% if redeemed during the first 12 months. They are also subject to an annual distribution and service fee of up to 1.00% of average daily net assets.
Performance for Class C shares, excluding sales charges, assumes either that contingent deferred sales charges did not apply or that the investment was not redeemed.
The Fund and benchmark performance table and the Performance of a $10,000 investment graph do not reflect the deduction of taxes the shareholder would pay on Fund distributions or redemptions of Fund shares.
2 The Funds expense ratios, as described in the most recent prospectus, are disclosed in the Fund expense ratios table on the next page. Delaware Management Company has agreed to reimburse certain expenses and/or waive certain fees in order to prevent total fund operating expenses (excluding any 12b-1 fees and certain other expenses) from exceeding 1.25% of the Funds average daily net assets from April 1, 2016, through March 31, 2017.* Please see the most recent prospectus and any applicable supplement(s) for additional information on these fee waivers and/or reimbursements.
(continues) | 23 |
Performance summaries
Optimum International Fund
Fund expense ratios | Class A | Class C | Institutional Class | |||
Total annual operating expenses (without fee waivers) |
1.49% | 2.24% | 1.24% | |||
Net expenses (including fee waivers, if any) |
1.49% | 2.24% | 1.24% | |||
Type of waiver |
Contractual | Contractual | Contractual |
* The aggregate contractual waiver period covering this report is from July 29, 2015 to July 29, 2017. Prior to July 29, 2016, the contractual waiver was 1.25%.
International investments entail risks not ordinarily associated with US investments including fluctuation in currency values, differences in accounting principles, or economic or political instability in other nations. Investing in emerging markets can be riskier than investing in established foreign markets due to increased volatility and lower trading volume.
The Funds may invest in derivatives, which may involve additional expenses and are subject to risk, including the risk that an underlying security or securities index moves in the opposite direction from what the portfolio manager anticipated. A derivative transaction depends upon the counterparties ability to fulfill their contractual obligations.
There is no guarantee that a dividend-paying stock will continue to pay dividends.
Performance of a $10,000 Investment1
Average annual total returns from March 31, 2007 through March 31, 2017
1The Performance of $10,000 investment graph assumes $10,000 invested in Class A and Institutional Class shares of the Fund on March 31, 2007, and includes the effect of a 5.75% front-end sales charge (for Class A shares) and the reinvestment of all distributions. The graph does not reflect the deduction of taxes the shareholders would pay on Fund distributions or redemptions of Fund shares. Expense limitations were in effect for some or all of the periods shown. Performance would have been lower had expense limitations not been in effect. Current expenses are listed in the Fund expense ratios table above. Please note additional details on pages 23 through 25.
The graph also assumes $10,000 invested in the MSCI EAFE Index as of March 31, 2007. The MSCI EAFE (Europe, Australasia, Far East) Index is a free float-adjusted market capitalization weighted index designed to measure equity market performance of developed markets, excluding the United States and Canada. Index gross return approximates the maximum possible dividend reinvestment. Index net return approximates the minimum possible dividend reinvestment, after deduction of withholding tax at the highest possible rate.
24 |
The MSCI ACWI ex USA Index, mentioned on page 4, is a free float-adjusted market capitalization weighted index that is designed to measure equity market performance across developed and emerging markets worldwide, excluding the United States. Index net return approximates the minimum possible dividend reinvestment, after deduction of withholding tax at the highest possible rate.
The MSCI Emerging Markets Index, mentioned on page 4, is a free float-adjusted market capitalization index designed to measure equity market performance across emerging market countries worldwide. Index net return approximates the minimum possible dividend reinvestment, after deduction of withholding tax at the highest possible rate.
The Russell 1000 Index, mentioned on page 4, measures the performance of the large-cap segment of the US equity universe.
Russell Investment Group is the source and owner of the trademarks, service marks, and copyrights related to the Russell Indexes. Russell® is a trademark of Russell Investment Group.
Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index. Past performance is not a guarantee of future results.
Performance of other Fund classes will vary due to different charges and expenses.
Stock symbols and CUSIP numbers | ||||
Nasdaq symbols | CUSIPs | |||
Class A | OAIEX | 246118731 | ||
Class C | OCIEX | 246118715 | ||
Institutional Class | OIIEX | 246118699 |
(continues) | 25 |
Performance summaries
Optimum Large Cap Growth Fund | March 31, 2017 | |
(Unaudited) |
The performance data quoted represent past performance; past performance does not guarantee future results. Investment return and principal value will fluctuate so your shares, when redeemed, may be worth more or less than their original cost. Please obtain the performance data for the most recent month end by calling 800 914-0278 or visiting our website at optimummutualfunds.com/performance. Current performance may be lower or higher than the performance data quoted.
Fund and benchmark performance1,2 | ||||||||||||
Average annual total returns through March 31, 2017 | 1 year | 5 years | 10 years | |||||||||
Class A (Est. Aug. 1, 2003) |
||||||||||||
Excluding sales charge |
+16.83% | +12.55% | +7.63% | |||||||||
Including sales charge |
+10.14% | +11.23% | +6.99% | |||||||||
Class C (Est. Aug. 1, 2003) |
||||||||||||
Excluding sales charge |
+15.88% | +11.75% | +6.89% | |||||||||
Including sales charge |
+14.88% | +11.75% | +6.89% | |||||||||
Institutional Class (Est. Aug. 1, 2003) |
||||||||||||
Excluding sales charge |
+17.14% | +12.89% | +7.97% | |||||||||
Including sales charge |
+17.14% | +12.89% | +7.97% | |||||||||
Russell 1000 Growth Index |
+15.76% | +13.32% | +9.13% |
1Returns reflect the reinvestment of all distributions and are presented both with and without the applicable sales charges described below. Returns do not reflect the deduction of taxes the shareholder would pay on Fund distributions or redemptions of Fund shares.
Expense limitations were in effect for certain classes during some or all of the periods shown in the Fund and benchmark performance graph. The current expenses for each class are listed on the Fund expense ratios table on the next page. Performance would have been lower had expense limitations not been in effect.
Institutional Class shares are available without sales or asset-based distribution charges only to certain eligible institutional accounts.
Class A shares are sold with a maximum front-end sales charge of 5.75%, and have an annual distribution and service fee of 0.25% of average daily net assets. Performance for Class A shares, excluding sales charges, assumes that no front-end sales charge applied.
Class C shares are sold with a contingent deferred sales charge of 1.00% if redeemed during the first 12 months. They are also subject to an annual distribution and service fee of 1.00% of average daily net assets.
Performance for Class C shares, excluding sales charges, assumes either that contingent deferred sales charges did not apply or that the investment was not redeemed.
The Fund and benchmark performance table and the Performance of a $10,000 investment graph do not reflect the deduction of taxes the shareholder would pay on Fund distributions or redemptions of Fund shares.
2 The Funds expense ratios, as described in the most recent prospectus, are disclosed in the Fund expense ratios table on the next page. Delaware Management Company has agreed to reimburse certain expenses and/or waive certain fees in order to prevent total fund operating expenses (excluding any 12b-1 fees and certain other expenses) from exceeding 1.10% of the Funds average daily net assets from April 1, 2016, through March 31, 2017.* Please see the most recent prospectus and any applicable supplement(s) for additional information on these fee waivers and/or reimbursements.
26 |
Fund expense ratios | Class A | Class C | Institutional Class | |||||||||
Total annual operating expenses |
||||||||||||
(without fee waivers) |
1.37% | 2.12% | 1.12% | |||||||||
Net expenses |
||||||||||||
(including fee waivers, if any) |
1.35% | 2.10% | 1.10% | |||||||||
Type of waiver |
Contractual | Contractual | Contractual |
* The aggregate contractual waiver period covering this report is from July 29, 2015 to July 29, 2017. Prior to July 29, 2016, the contractual waiver was 1.09%.
Narrowly focused investments may exhibit higher volatility than investments in multiple industry sectors.
REIT investments are subject to many of the risks associated with direct real estate ownership, including changes in economic conditions, credit risk, and interest rate fluctuations.
Performance of a $10,000 Investment1
Average annual total returns from March 31, 2007 through March 31, 2017
1The Performance of $10,000 investment graph assumes $10,000 invested in Class A and Institutional Class shares of the Fund on March 31, 2007, and includes the effect of a 5.75% front-end sales charge (for Class A shares) and the reinvestment of all distributions. The graph does not reflect the deduction of taxes the shareholders would pay on Fund distributions or redemptions of Fund shares. Expense limitations were in effect for some or all of the periods shown. Performance would have been lower had expense limitations not been in effect. Current expenses are listed in the Fund expense ratios table above. Please note additional details on pages 26 through 28.
The graph also assumes $10,000 invested in the Russell 1000 Growth Index as of March 31, 2007. The Russell 1000 Growth Index measures the performance of the large-cap growth segment of the US equity universe. It includes those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values.
Russell Investment Group is the source and owner of the trademarks, service marks, and copyrights related to the Russell Indexes. Russell® is a trademark of Russell Investment Group.
Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index. Past performance is not a guarantee of future results.
Performance of other Fund classes will vary due to different charges and expenses.
(continues) | 27 |
Performance summaries
Optimum Large Cap Growth Fund
Stock symbols and CUSIP numbers | ||||
Nasdaq symbols | CUSIPs | |||
Class A | OALGX | 246118707 | ||
Class C | OCLGX | 246118889 | ||
Institutional Class | OILGX | 246118871 |
28
Optimum Large Cap Value Fund | March 31, 2017 | |
(Unaudited) |
The performance data quoted represent past performance; past performance does not guarantee future results. Investment return and principal value will fluctuate so your shares, when redeemed, may be worth more or less than their original cost. Please obtain the performance data for the most recent month end by calling 800 914-0278 or visiting our website at optimummutualfunds.com/performance. Current performance may be lower or higher than the performance data quoted.
Fund and benchmark performance1,2 |
||||||||||||
Average annual total returns through March 31, 2017 |
1 year | 5 years | 10 years | |||||||||
Class A (Est. Aug. 1, 2003) |
||||||||||||
Excluding sales charge |
+14.99% | +9.31% | +4.96% | |||||||||
Including sales charge |
+8.40% | +8.01% | +4.34% | |||||||||
Class C (Est. Aug. 1, 2003) |
||||||||||||
Excluding sales charge |
+14.13% | +8.55% | +4.25% | |||||||||
Including sales charge |
+13.13% | +8.55% | +4.25% | |||||||||
Institutional Class (Est. Aug. 1, 2003) |
||||||||||||
Excluding sales charge |
+15.30% | +9.63% | +5.30% | |||||||||
Including sales charge |
+15.30% | +9.63% | +5.30% | |||||||||
Russell 1000 Value Index |
+19.22% | +13.13% | +5.93% |
1Returns reflect the reinvestment of all distributions and are presented both with and without the applicable sales charges described below. Returns do not reflect the deduction of taxes the shareholder would pay on Fund distributions or redemptions of Fund shares.
Expense limitations were in effect for certain classes during some or all of the periods shown in the Fund and benchmark performance graph. The current expenses for each class are listed on the Fund expense ratios table on the next page. Performance would have been lower had expense limitations not been in effect.
Institutional Class shares are available without sales or asset-based distribution charges only to certain eligible institutional accounts.
Class A shares are sold with a maximum front-end sales charge of up to 5.75%, and have an annual distribution and service fee of up to 0.25% of average daily net assets. Performance for Class A shares, excluding sales charges, assumes that no front-end sales charge applied.
Class C shares are sold with a contingent deferred sales charge of 1.00% if redeemed during the first 12 months. They are also subject to an annual distribution and service fee of up to 1.00% of average daily net assets.
Performance for Class C shares, excluding sales charges, assumes either that contingent deferred sales charges did not apply or that the investment was not redeemed.
The Fund and benchmark performance table and the Performance of a $10,000 investment graph do not reflect the deduction of taxes the shareholder would pay on Fund distributions or redemptions of Fund shares.
2 The Funds expense ratios, as described in the most recent prospectus, are disclosed in the Fund expense ratios table on the next page. Delaware Management Company has agreed to reimburse certain expenses and/or waive certain fees in order to prevent total fund operating expenses (excluding any 12b-1 fees and certain other expenses) from exceeding 1.08% of the Funds average daily net assets from April 1, 2016, through March 31, 2017.* Please see the most recent prospectus and any applicable supplement(s) for additional information on these fee waivers and/or reimbursements.
(continues) | 29 |
Performance summaries
Optimum Large Cap Value Fund
Fund expense ratios | Class A | Class C | Institutional Class | |||||||||
Total annual operating expenses |
||||||||||||
(without fee waivers) |
1.34% | 2.09% | 1.09% | |||||||||
Net expenses |
||||||||||||
(including fee waivers, if any) |
1.33% | 2.08% | 1.08% | |||||||||
Type of waiver |
Contractual | Contractual | Contractual |
*The aggregate contractual waiver period covering this report is from July 29, 2015 to July 29, 2017. Prior to July 29, 2016, the contractual waiver was 1.08%.
Performance of a $10,000 Investment1
Average annual total returns from March 31, 2007 through March 31, 2017
1The Performance of $10,000 investment graph assumes $10,000 invested in Class A and Institutional Class shares of the Fund on March 31, 2007, and includes the effect of a 5.75% front-end sales charge (for Class A shares) and the reinvestment of all distributions. The graph does not reflect the deduction of taxes the shareholders would pay on Fund distributions or redemptions of Fund shares. Expense limitations were in effect for some or all of the periods shown. Performance would have been lower had expense limitations not been in effect. Current expenses are listed in the Fund expense ratios table above. Please note additional details on pages 29 through 31.
The graph also assumes $10,000 invested in the Russell 1000 Value Index as of March 31, 2007. The Russell 1000 Value Index measures the performance of the large-cap value segment of the US equity universe. It includes those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values.
Russell Investment Group is the source and owner of the trademarks, service marks, and copyrights related to the Russell Indexes. Russell® is a trademark of Russell Investment Group.
Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index. Past performance is not a guarantee of future results.
Performance of other Fund classes will vary due to different charges and expenses.
30 |
Stock symbols and CUSIP numbers | ||||
Nasdaq symbols | CUSIPs | |||
Class A | OALVX | 2461118863 | ||
Class C | OCLVX | 2461118848 | ||
Institutional Class | OILVX | 2461118830 |
(continues) | 31 |
Performance summaries
Optimum Small-Mid Cap Growth Fund | March 31, 2017 | |
(Unaudited) |
The performance data quoted represent past performance; past performance does not guarantee future results. Investment return and principal value will fluctuate so your shares, when redeemed, may be worth more or less than their original cost. Please obtain the performance data for the most recent month end by calling 800 914-0278 or visiting our website at optimummutualfunds.com/performance. Current performance may be lower or higher than the performance data quoted.
Fund and benchmark performance1,2 | ||||||||||||
Average annual total returns through March 31, 2017 | 1 year | 5 years | 10 years | |||||||||
Class A (Est. Aug. 1, 2003) |
||||||||||||
Excluding sales charge |
+21.55% | +8.56% | +4.59% | |||||||||
Including sales charge |
+14.55% | +7.29% | +3.97% | |||||||||
Class C (Est. Aug. 1, 2003) |
||||||||||||
Excluding sales charge |
+20.60% | +7.77% | +3.86% | |||||||||
Including sales charge |
+19.60% | +7.77% | +3.86% | |||||||||
Institutional Class (Est. Aug. 1, 2003) |
||||||||||||
Excluding sales charge |
+21.80% | +8.87% | +4.91% | |||||||||
Including sales charge |
+21.80% | +8.87% | +4.91% | |||||||||
Russell 2500 Growth Index |
+19.77% | +12.17% | +8.47% |
1Returns reflect the reinvestment of all distributions and are presented both with and without the applicable sales charges described below. Returns do not reflect the deduction of taxes the shareholder would pay on Fund distributions or redemptions of Fund shares.
Expense limitations were in effect for certain classes during some or all of the periods shown in the Fund and benchmark performance graph. The current expenses for each class are listed on the Fund expense ratios table on the next page. Performance would have been lower had expense limitations not been in effect.
Institutional Class shares are available without sales or asset-based distribution charges only to certain eligible institutional accounts.
Class A shares are sold with a maximum front-end sales charge of 5.75%, and have an annual distribution and service fee of 0.25% of average daily net assets. Performance for Class A shares, excluding sales charges, assumes that no front-end sales charge applied.
Class C shares are sold with a contingent deferred sales charge of 1.00% if redeemed during the first 12 months. They are also subject to an annual distribution and service fee of 1.00% of average daily net assets.
Performance for Class C shares, excluding sales charges, assumes either that contingent deferred sales charges did not apply or that the investment was not redeemed.
The Fund and benchmark performance table and the Performance of a $10,000 investment graph do not reflect the deduction of taxes the shareholder would pay on Fund distributions or redemptions of Fund shares.
2 The Funds expense ratios, as described in the most recent prospectus, are disclosed in the Fund expense ratios table on the next page. Delaware Management Company has agreed to reimburse certain expenses and/or waive certain fees in order to prevent total fund operating expenses (excluding any 12b-1 fees and certain other expenses) from exceeding 1.33% of the Funds average daily net assets from April 1, 2016, through March 31, 2017.* Please see the most recent prospectus and any applicable supplement(s) for additional information on these fee waivers and/or reimbursements.
32 |
Fund expense ratios | Class A | Class C | Institutional Class | |||
Total annual operating expenses (without fee waivers) |
1.78% |
2.53% |
1.53% | |||
Net expenses (including fee waivers, if any) |
1.58% |
2.33% |
1.33% | |||
Type of waiver |
Contractual | Contractual | Contractual |
*The aggregate contractual waiver period covering this report is from July 29, 2015 to July 29, 2017. Prior to July 29, 2016, the contractual waiver was 1.34%.
Investments in small and/or medium-sized companies typically exhibit greater risk and higher volatility than larger, more established companies.
Performance of a $10,000 Investment1
Average annual total returns from March 31, 2007 through March 31, 2017
1The Performance of $10,000 investment graph assumes $10,000 invested in Class A and Institutional Class shares of the Fund on March 31, 2007, and includes the effect of a 5.75% front-end sales charge (for Class A shares) and the reinvestment of all distributions. The graph does not reflect the deduction of taxes the shareholders would pay on Fund distributions or redemptions of Fund shares. Expense limitations were in effect for some or all of the periods shown. Performance would have been lower had expense limitations not been in effect. Current expenses are listed in the Fund expense ratios table above. Please note additional details on pages 32 through 34.
The graph also assumes $10,000 invested in the Russell 2500 Growth Index as of March 31, 2007. The Russell 2500 Growth Index measures the performance of the small- to mid-cap growth segment of the US equity universe. It includes those Russell 2500 companies with higher price-to-book ratios and higher forecasted growth values.
Russell Investment Group is the source and owner of the trademarks, service marks, and copyrights related to the Russell Indexes. Russell® Investment Group.
Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index. Past performance is not a guarantee of future results.
Performance of other Fund classes will vary due to different charges and expenses.
(continues) | 33 |
Performance summaries
Optimum Small-Mid Cap Growth Fund
Stock symbols and CUSIP numbers | ||||
Nasdaq symbols | CUSIPs | |||
Class A | OASGX | 246118822 | ||
Class C | OCSGX | 246118798 | ||
Institutional Class | OISGX | 246118780 |
34 |
Optimum Small-Mid Cap Value Fund | March 31, 2017 | |
(Unaudited)
|
The performance data quoted represent past performance; past performance does not guarantee future results. Investment return and principal value will fluctuate so your shares, when redeemed, may be worth more or less than their original cost. Please obtain the performance data for the most recent month end by calling 800 914-0278 or visiting our website at optimummutualfunds.com/performance. Current performance may be lower or higher than the performance data quoted.
Fund and benchmark performance1,2
Average annual total returns through March 31, 2017 |
1 year | 5 years | 10 years | |||||||||
Class A (Est. Aug. 1, 2003) |
||||||||||||
Excluding sales charge |
+19.84% | +7.65% | +4.04% | |||||||||
Including sales charge |
+12.98% | +6.38% | +3.43% | |||||||||
Class C (Est. Aug. 1, 2003) |
||||||||||||
Excluding sales charge |
+18.89% | +6.87% | +3.33% | |||||||||
Including sales charge |
+17.89% | +6.87% | +3.33% | |||||||||
Institutional Class (Est. Aug. 1, 2003) |
||||||||||||
Excluding sales charge |
+20.05% | +7.93% | +4.38% | |||||||||
Including sales charge |
+20.05% | +7.93% | +4.38% | |||||||||
Russell 2500 Value Index |
+23.13% | +12.92% | +6.79% |
1Returns reflect the reinvestment of all distributions and are presented both with and without the applicable sales charges described below. Returns do not reflect the deduction of taxes the shareholder would pay on Fund distributions or redemptions of Fund shares.
Expense limitations were in effect for certain classes during some or all of the periods shown in the Fund and benchmark performance graph. The current expenses for each class are listed on the Fund expense ratios table on the next page. Performance would have been lower had expense limitations not been in effect.
Institutional Class shares are available without sales or asset-based distribution charges only to certain eligible institutional accounts.
Class A shares are sold with a maximum front-end sales charge of 5.75%, and have an annual distribution and service fee of 0.25% of average daily net assets. Performance for Class A shares, excluding sales charges, assumes that no front-end sales charge applied.
Class C shares are sold with a contingent deferred sales charge of 1.00% if redeemed during the first 12 months. They are also subject to an annual distribution and service fee of 1.00% of average daily net assets.
Performance for Class C shares, excluding sales charges, assumes either that contingent deferred sales charges did not apply or that the investment was not redeemed.
The Fund and benchmark performance table and the Performance of a $10,000 investment graph do not reflect the deduction of taxes the shareholder would pay on Fund distributions or redemptions of Fund shares.
2 The Funds expense ratios, as described in the most recent prospectus, are disclosed in the Fund expense ratios table on the next page. Delaware Management Company has agreed to reimburse certain expenses and/or waive certain fees in order to prevent total fund operating expenses (excluding any 12b-1 fees and certain other expenses) from exceeding 1.25% of the Funds average daily net assets from April 1, 2016, through March 31, 2017.* Please see the most recent prospectus and any applicable supplement(s) for additional information on these fee waivers and/or reimbursements.
(continues) | 35 |
Performance summaries
Optimum Small-Mid Cap Value Fund
Fund expense ratios |
Class A | Class C | Institutional Class | |||
Total annual operating expenses (without fee waivers) |
1.69% | 2.44% | 1.44% | |||
Net expenses (including fee waivers, if any) |
1.50% | 2.25% | 1.25% | |||
Type of waiver |
Contractual | Contractual | Contractual |
*The aggregate contractual waiver period covering this report is from July 29, 2015 to July 29, 2017. Prior to July 29, 2016, the contractual waiver was 1.27%.
Investing involves risk, including the possible loss of principal.
Investments in small and/or medium-sized companies typically exhibit greater risk and higher volatility than larger, more established companies.
Performance of a $10,000 Investment1
Average annual total returns from March 31, 2007 through March 31, 2017
1The Performance of $10,000 investment graph assumes $10,000 invested in Class A and Institutional Class shares of the Fund on March 31, 2007, and includes the effect of a 5.75% front-end sales charge (for Class A shares) and the reinvestment of all distributions. The graph does not reflect the deduction of taxes the shareholders would pay on Fund distributions or redemptions of Fund shares. Expense limitations were in effect for some or all of the periods shown. Performance would have been lower had expense limitations not been in effect. Current expenses are listed in the Fund expense ratios table above. Please note additional details on pages 35 through 37.
The graph also assumes $10,000 invested in the Russell 2500 Value Index as of March 31, 2007. The Russell 2500 Value Index measures the performance of the small- to mid-cap value segment of the US equity universe. It includes those Russell 2500 companies with lower price-to-book ratios and lower forecasted growth values.
Russell Investment Group is the source and owner of the trademarks, service marks, and copyrights related to the Russell Index. Russell® is a trademark of Russell Investment Group.
Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index. Past performance is not a guarantee of future results.
Performance of other Fund classes will vary due to different charges and expenses.
36
Stock symbols and CUSIP numbers | ||||
Nasdaq symbols | CUSIPs | |||
Class A | OASVX | 246118772 | ||
Class C | OCSVX | 246118756 | ||
Institutional Class | OISVX | 246118749 |
(continues) | 37 |
For the six-month period from October 1, 2016 to March 31, 2017 (Unaudited)
38
(continues) | 39 |
Security type / sector allocations
Optimum Fixed Income Fund
As of March 31, 2017 (Unaudited)
Sector designations may be different than the sector designations presented in other Fund materials. The sector designations may represent the investment manager or sub-advisors internal sector classifications, which may result in the sector designations for one fund being different than another funds sector designations.
40 |
Security type / country and sector allocations
Optimum International Fund
As of March 31, 2017 (Unaudited)
Sector designations may be different than the sector designations presented in other Fund materials. The sector designations may represent the investment manager or sub-advisors internal sector classifications, which may result in the sector designations for one fund being different than another funds sector designations.
(continues) | 41 |
Security type / sector allocations and top 10 equity holdings
Sector designations may be different than the sector designations presented in other Fund materials. The sector designations may represent the investment manager or sub-advisors internal sector classifications, which may result in the sector designations for one fund being different than another funds sector designations.
42
Sector designations may be different than the sector designations presented in other Fund materials. The sector designations may represent the investment manager or sub-advisors internal sector classifications, which may result in the sector designations for one fund being different than another funds sector designations.
(continues) | 43 |
Security type / sector allocations and top 10 equity holdings
44
Optimum Fixed Income Fund
March 31, 2017
(continues) | 45 |
Schedules of investments
Optimum Fixed Income Fund
46 |
(continues) | 47 |
Schedules of investments
Optimum Fixed Income Fund
48 |
(continues) | 49 |
Schedules of investments
Optimum Fixed Income Fund
50 |
(continues) | 51 |
Schedules of investments
Optimum Fixed Income Fund
52 |
(continues) | 53 |
Schedules of investments
Optimum Fixed Income Fund
54 |
(continues) | 55 |
Schedules of investments
Optimum Fixed Income Fund
56 |
(continues) | 57 |
Schedules of investments
Optimum Fixed Income Fund
58 |
(continues) | 59 |
Schedules of investments
Optimum Fixed Income Fund
60 |
(continues) | 61 |
Schedules of investments
Optimum Fixed Income Fund
62 |
(continues) | 63 |
Schedules of investments
Optimum Fixed Income Fund
64 |
(continues) | 65 |
Schedules of investments
Optimum Fixed Income Fund
66 |
(continues) | 67 |
Schedules of investments
Optimum Fixed Income Fund
68 |
(continues) | 69 |
Schedules of investments
Optimum Fixed Income Fund
70 |
(continues) | 71 |
Schedules of investments
Optimum Fixed Income Fund
72 |
(continues) | 73 |
Schedules of investments
Optimum Fixed Income Fund
74 |
(continues) | 75 |
Schedules of investments
Optimum Fixed Income Fund
76 |
(continues) | 77 |
Schedules of investments
Optimum Fixed Income Fund
78 |
(continues) | 79 |
Schedules of investments
Optimum Fixed Income Fund
80 |
(continues) | 81 |
Schedules of investments
Optimum Fixed Income Fund
82 |
(continues) | 83 |
Schedules of investments
Optimum Fixed Income Fund
84 |
The following foreign currency exchange contracts, futures contracts, and swap contracts were outstanding at March 31, 2017:1
Foreign Currency Exchange Contracts
Counterparty |
Contracts to Receive (Deliver) |
In Exchange For | Settlement Date |
Unrealized Appreciation (Depreciation) |
||||||||||||||||||||||||||||
BAML |
AUD | (510,000 | ) | USD | 391,130 | 4/4/17 | $ | 1,516 | ||||||||||||||||||||||||
BAML |
AUD | (1,324,000 | ) | USD | 1,014,610 | 5/2/17 | 3,644 | |||||||||||||||||||||||||
BAML |
AUD | (2,830,386 | ) | USD | 2,154,631 | 5/12/17 | (6,142 | ) | ||||||||||||||||||||||||
BAML |
BRL | 22,254,720 | USD | (7,187,288 | ) | 5/3/17 | (132,097 | ) | ||||||||||||||||||||||||
BAML |
CAD | 591,000 | USD | (437,229 | ) | 4/4/17 | 7,208 | |||||||||||||||||||||||||
BAML |
CAD | (1,370,047 | ) | USD | 1,023,218 | 5/12/17 | (7,617 | ) | ||||||||||||||||||||||||
BAML |
EUR | (1,098,000 | ) | USD | 1,172,318 | 4/3/17 | 821 | |||||||||||||||||||||||||
BAML |
EUR | (18,510,000 | ) | USD | 19,634,223 | 4/4/17 | (115,629 | ) | ||||||||||||||||||||||||
BAML |
EUR | 1,098,000 | USD | (1,173,822 | ) | 5/2/17 | (779 | ) | ||||||||||||||||||||||||
BAML |
EUR | 2,301,970 | USD | (2,504,543 | ) | 5/12/17 | (44,024 | ) | ||||||||||||||||||||||||
BAML |
INR | 23,338,266 | USD | (338,133 | ) | 4/20/17 | 21,463 | |||||||||||||||||||||||||
BAML |
JPY | 108,000,000 | USD | (971,223 | ) | 4/4/17 | (1,010 | ) | ||||||||||||||||||||||||
BAML |
JPY | (108,000,000 | ) | USD | 972,241 | 5/2/17 | 903 | |||||||||||||||||||||||||
BAML |
JPY | 34,779,403 | USD | (315,645 | ) | 5/12/17 | (2,735 | ) | ||||||||||||||||||||||||
BAML |
MXN | 88,622,555 | USD | (4,313,932 | ) | 4/17/17 | 407,113 | |||||||||||||||||||||||||
BAML |
MXN | (14,300,000 | ) | USD | 716,038 | 8/17/17 | (31,616 | ) | ||||||||||||||||||||||||
BAML |
NZD | (3,177,739 | ) | USD | 2,231,535 | 5/12/17 | 6,388 | |||||||||||||||||||||||||
BAML |
SGD | (9,478,079 | ) | USD | 6,747,789 | 6/23/17 | (32,254 | ) | ||||||||||||||||||||||||
BAML |
TWD | (69,157,201 | ) | USD | 2,265,666 | 6/23/17 | (21,051 | ) | ||||||||||||||||||||||||
BCLY |
BRL | 8,658,540 | USD | (2,743,082 | ) | 5/12/17 | (4,208 | ) | ||||||||||||||||||||||||
BCLY |
COP | 3,270,500,226 | USD | (1,113,816 | ) | 5/12/17 | 17,069 | |||||||||||||||||||||||||
BNP |
AUD | 564,000 | USD | (433,611 | ) | 4/4/17 | (2,744 | ) | ||||||||||||||||||||||||
BNP |
AUD | (1,381,816 | ) | USD | 1,051,275 | 5/12/17 | (3,631 | ) | ||||||||||||||||||||||||
BNP |
EUR | 18,058,000 | USD | (19,475,553 | ) | 4/4/17 | (207,977 | ) | ||||||||||||||||||||||||
BNP |
EUR | (18,396,000 | ) | USD | 19,865,416 | 5/2/17 | 212,127 | |||||||||||||||||||||||||
BNP |
GBP | 12,176,000 | USD | (15,155,344 | ) | 4/4/17 | 101,356 | |||||||||||||||||||||||||
BNP |
GBP | (12,176,000 | ) | USD | 15,165,232 | 5/2/17 | (101,523 | ) | ||||||||||||||||||||||||
BNP |
JPY | (108,000,000 | ) | USD | 963,343 | 4/4/17 | (6,870 | ) | ||||||||||||||||||||||||
BNP |
MXN | (45,000,000 | ) | USD | 2,252,748 | 8/17/17 | (100,009 | ) | ||||||||||||||||||||||||
BNP |
NOK | 6,491,578 | USD | (762,989 | ) | 5/12/17 | (6,609 | ) | ||||||||||||||||||||||||
BNYM |
CAD | (4,650 | ) | USD | 3,487 | 4/3/17 | (9 | ) | ||||||||||||||||||||||||
CITI |
CAD | 625,000 | USD | (469,501 | ) | 4/4/17 | 505 | |||||||||||||||||||||||||
CITI |
CAD | (2,446,000 | ) | USD | 1,838,254 | 5/2/17 | (1,900 | ) |
(continues) | 85 |
Schedules of investments
Optimum Fixed Income Fund
Counterparty |
Contracts to Receive (Deliver) |
In Exchange For | Settlement Date |
Unrealized Appreciation (Depreciation) |
||||||||||||||||||||||||||||||
CITI |
EUR | 452,000 | USD | (477,909 | ) | 4/4/17 | $ | 4,367 | ||||||||||||||||||||||||||
HSBC |
EUR | (142,638 | ) | USD | 155,240 | 5/12/17 | 2,778 | |||||||||||||||||||||||||||
HSBC |
GBP | 360,383 | USD | (452,857 | ) | 5/12/17 | (887 | ) | ||||||||||||||||||||||||||
JPMC |
AUD | (54,000 | ) | USD | 40,888 | 4/4/17 | (365 | ) | ||||||||||||||||||||||||||
JPMC |
CAD | (1,216,000 | ) | USD | 912,716 | 4/4/17 | (1,727 | ) | ||||||||||||||||||||||||||
JPMC |
DKK | 265,000 | USD | (38,343 | ) | 4/3/17 | (337 | ) | ||||||||||||||||||||||||||
JPMC |
GBP | (12,176,000 | ) | USD | 15,004,364 | 4/4/17 | (252,336 | ) | ||||||||||||||||||||||||||
JPMC |
KRW | (1,150,799,750 | ) | USD | 1,034,590 | 5/12/17 | 4,368 | |||||||||||||||||||||||||||
JPMC |
MXN | 158,865,000 | USD | (7,905,266 | ) | 4/17/17 | 557,691 | |||||||||||||||||||||||||||
JPMC |
PLN | (795,314 | ) | USD | 203,643 | 5/12/17 | 3,183 | |||||||||||||||||||||||||||
JPMC |
SEK | 813,406 | USD | (92,873 | ) | 5/12/17 | (1,917 | ) | ||||||||||||||||||||||||||
JPMC |
THB | (4,239,616 | ) | USD | 120,829 | 6/23/17 | (2,477 | ) | ||||||||||||||||||||||||||
TD |
AUD | 1,099,731 | USD | (838,451 | ) | 5/12/17 | 1,105 | |||||||||||||||||||||||||||
TD |
COP | 2,706,630,221 | USD | (921,876 | ) | 5/12/17 | 14,032 | |||||||||||||||||||||||||||
TD |
EUR | 77,397 | USD | (83,175 | ) | 5/12/17 | (447 | ) | ||||||||||||||||||||||||||
TD |
JPY | 129,558,430 | USD | (1,176,669 | ) | 5/12/17 | (11,031 | ) | ||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||||||
$ | 265,679 | |||||||||||||||||||||||||||||||||
|
|
Futures Contracts
Contracts to Buy (Sell) |
Notional Cost (Proceeds) |
Notional Value |
Expiration Date |
Unrealized Appreciation (Depreciation) |
||||||||||||
(1,002) 90 Day Euro |
$ | (246,727,610 | ) | $ | (245,464,950 | ) | 12/18/18 | $ | 1,262,660 | |||||||
(344) 90 Day Euro |
(85,079,134 | ) | (84,576,700 | ) | 3/20/18 | 502,434 | ||||||||||
(235) 90 Day Euro |
(57,914,207 | ) | (57,704,250 | ) | 6/19/18 | 209,957 | ||||||||||
(39) 90 Day Euro |
(9,613,433 | ) | (9,565,725 | ) | 9/18/18 | 47,708 | ||||||||||
(4) 90 Day Euro |
(989,605 | ) | (984,500 | ) | 12/19/17 | 5,105 | ||||||||||
(647) 90 Day Euro |
(159,009,302 | ) | (159,436,975 | ) | 9/19/17 | (427,673 | ) | |||||||||
(120) 90 Day Sterling |
(18,659,627 | ) | (18,671,344 | ) | 12/20/18 | (11,717 | ) | |||||||||
86 Australian 3 yr Bonds |
6,403,839 | 6,442,277 | 6/16/17 | 38,438 | ||||||||||||
111 Australian 10 yr Bonds |
8,218,811 | 8,248,885 | 6/16/17 | 30,074 | ||||||||||||
(40) Euro-Bund |
(6,888,698 | ) | (6,888,114 | ) | 6/9/17 | 584 | ||||||||||
(258) Euro-O.A.T |
(40,546,292 | ) | (40,470,466 | ) | 6/9/17 | 75,826 | ||||||||||
(449) U.S. Treasury 2 yr Notes |
(97,102,543 | ) | (97,187,453 | ) | 7/1/17 | (84,910 | ) | |||||||||
2,835 U.S. Treasury 5 yr Notes |
333,271,939 | 333,754,804 | 7/3/17 | 482,865 | ||||||||||||
1,398 U.S. Treasury 10 yr Notes |
174,090,227 | 174,138,375 | 6/22/17 | 48,148 | ||||||||||||
248 U.S. Treasury Ultra Bond |
37,059,421 | 37,409,250 | 6/22/17 | 349,829 | ||||||||||||
|
|
|
|
|||||||||||||
$ | (163,486,214 | ) | $ | 2,529,328 | ||||||||||||
|
|
|
|
86 |
Swap Contracts
CDS Contracts2
Counterparty |
Swap Referenced Obligation |
Notional Value3 |
Annual Protection Payments |
Termination Date |
Upfront Payments Paid (Received) |
Unrealized Appreciation (Depreciation)4 |
||||||||||||||||
Protection Purchased / Moodys ratings: |
||||||||||||||||||||||
HSBC |
CDX.EM.275 | 2,240,000 | 1.00% | 6/20/22 | $124,850 | $ | (5,993 | ) | ||||||||||||||
ICE |
CSFB CDX.NA.HY.276 | 5,742,000 | 5.00% | 12/20/21 | (263,103) | (191,054 | ) | |||||||||||||||
ICE |
CSFB CDX.NA.IG.267 | 10,300,000 | 1.00% | 6/20/21 | (105,063) | (104,441 | ) | |||||||||||||||
ICE |
JPMC CDX.NA.HY.276 | 3,960,000 | 5.00% | 12/20/21 | (276,640) | (36,572 | ) | |||||||||||||||
|
|
|||||||||||||||||||||
(338,060 | ) | |||||||||||||||||||||
|
|
|||||||||||||||||||||
Protection Sold / Moodys ratings: | ||||||||||||||||||||||
BAML |
Citigroup 6.125% 5/15/18 Baa1 | 700,000 | 1.00% | 12/20/20 | (1,106) | 14,345 | ||||||||||||||||
BAML |
Republic of Brazil 4.25% 1/7/25 Ba2 CDS |
700,000 | 1.00% | 12/20/21 | (61,562) | 29,306 | ||||||||||||||||
BAML |
Republic of Colombia 10.375% 1/28/33 Baa2 |
100,000 | 1.00% | 6/20/21 | (2,763) | 2,727 | ||||||||||||||||
BAML |
Republic of Colombia 10.375% 1/28/33 Baa2 |
500,000 | 1.00% | 12/20/21 | (22,350) | 18,036 | ||||||||||||||||
BAML |
Republic of Italy 6.875% 9/27/23 Baa2 |
9,800,000 | 1.00% | 6/20/21 | (138,384) | (68,439 | ) | |||||||||||||||
BNP |
Republic of Colombia 10.375% 1/28/33 Baa2 |
200,000 | 1.00% | 6/20/21 | (5,594) | 5,522 | ||||||||||||||||
DB |
CMBX.NA.AAA8 | 14,200,000 | 0.50% | 10/17/57 | (933,206) | 740,000 | ||||||||||||||||
DB |
Republic of Colombia 10.375% 1/28/33 Baa2 |
200,000 | 1.00% | 6/20/21 | (5,525) | 5,453 | ||||||||||||||||
GSC |
Republic of Colombia 10.375% 1/28/33 Baa2 |
3,100,000 | 1.00% | 6/20/21 | (87,900) | 86,789 | ||||||||||||||||
JPMC |
Mexico LA 5 yr 5.950% 3/19/19 A3 |
12,900,000 | 1.00% | 12/20/19 | 66,915 | 58,799 | ||||||||||||||||
JPMC |
Republic of Colombia 10.375% 1/28/33 Baa2 |
100,000 | 1.00% | 6/20/21 | (2,797) | 2,761 | ||||||||||||||||
JPMC |
Volkswagen International 5.375% 5/22/18 A3 |
EUR | 2,500,000 | 1.00% | 12/20/17 | (16,473) | 27,497 | |||||||||||||||
|
|
|||||||||||||||||||||
$ | 922,796 | |||||||||||||||||||||
|
|
|||||||||||||||||||||
Total |
$ | 584,736 | ||||||||||||||||||||
|
|
(continues) | 87 |
Schedules of investments
Optimum Fixed Income Fund
Interest Rate Swap Contracts9
Counterparty |
Swap Referenced Obligation |
Notional Value3 | Fixed Interest Rate Paid (Received) |
Variable Interest Rate Paid (Received) |
Termination Date |
Upfront Payments Paid (Received) |
Unrealized Appreciation (Depreciation)4 |
|||||||||||||||
CME |
BAML 10 yr USD-ICE- 3-month LIBOR | 1,490,000 | 1.686% | (0.999%) | 4/5/26 | $ | | $ | 82,776 | |||||||||||||
CME |
BAML 30 yr USD-ICE- 3-month LIBOR | 1,770,000 | 2.767% | (1.152%) | 12/21/46 | | (27,905 | ) | ||||||||||||||
CME |
BAML 5 yr USD-ICE- 3-month LIBOR | 5,035,000 | 1.199% | (1.005%) | 4/6/21 | | 145,869 | |||||||||||||||
CME |
BAML 5 yr USD-ICE- 3-month LIBOR | 6,220,000 | 1.190% | (1.038%) | 8/9/21 | | 208,066 | |||||||||||||||
CME |
BAML 7 yr USD-ICE- 3-month LIBOR | 750,000 | 1.416% | (1.005%) | 4/6/23 | | 31,600 | |||||||||||||||
CME |
CSFB 10 yr USD-ICE- 3-month LIBOR | 20,700,000 | (1.500%) | 1.149% | 6/21/27 | (1,791,289 | ) | (864 | ) | |||||||||||||
CME |
CSFB 10 yr USD-ICE- 3-month LIBOR | 6,600,000 | 1.500% | (1.148%) | 6/21/27 | 582,211 | (10,797 | ) | ||||||||||||||
CME |
CSFB 2 yr USD-ICE- 3-month LIBOR | 7,200,000 | 1.350% | (1.350%) | 12/28/18 | | (26,667 | ) | ||||||||||||||
CME |
CSFB 2 yr USD-ICE- 3-month LIBOR | 30,100,000 | 1.450% | (1.148%) | 6/28/21 | | 497,716 | |||||||||||||||
CME |
CSFB 3 yr USD-ICE- 3-month LIBOR | 32,700,000 | 1.250% | (1.148%) | 6/21/20 | 733,215 | (119,703 | ) | ||||||||||||||
CME |
CSFB 30 yr USD-ICE- 3-month LIBOR | 500,000 | 2.500% | (1.131%) | 6/15/46 | (20,715 | ) | 41,500 | ||||||||||||||
CME |
CSFB 30 yr USD-ICE- 3-month LIBOR | 900,000 | 2.250% | (1.152%) | 12/21/46 | (71,604 | ) | 158,454 | ||||||||||||||
CME |
CSFB 4 yr USD-ICE- 3-month LIBOR | 16,500,000 | 1.250% | (1.042%) | 6/21/21 | 489,597 | (1,379 | ) | ||||||||||||||
CME |
CSFB 4 yr USD-ICE- 3-month LIBOR | 1,600,000 | 2.000% | (1.137%) | 12/16/19 | (4,459 | ) | (5,670 | ) | |||||||||||||
CME |
CSFB 5 yr Mexico TIEE-Banxico 28D | MXN | 82,500,000 | (5.797%) | 6.606% | 9/6/21 | (146,999 | ) | (89,575 | ) | ||||||||||||
CME |
CSFB 5 yr USD-ICE- 3-month LIBOR | 2,900,000 | 1.250% | (1.148%) | 6/21/22 | 118,951 | 2,504 | |||||||||||||||
CME |
CSFB 5yr Mexico TIEE-Banxico 28D | MXN | 17,900,000 | (7.199%) | 6.606% | 12/3/21 | (19,232 | ) | 20,036 | |||||||||||||
LCH |
BAML 3 yr USD-ICE- 3-month LIBOR | 5,860,000 | 1.666% | (1.156%) | 1/25/20 | | 17,665 | |||||||||||||||
LCH |
BAML 30 yr USD-ICE- 3-month LIBOR | 440,000 | 2.596% | (1.041%) | 1/23/47 | | 5,253 | |||||||||||||||
LCH |
BAML 30 yr USD-ICE- 3-month LIBOR | 440,000 | 2.623% | (1.043%) | 1/24/47 | | 2,706 | |||||||||||||||
LCH |
BAML 30 yr USD-ICE- 3-month LIBOR | 440,000 | 2.661% | (1.037%) | 1/27/47 | | (959 | ) | ||||||||||||||
LCH |
BAML 30 yr USD-ICE- 3-month LIBOR | 705,000 | 2.686% | (1.039%) | 1/30/47 | | (5,471 | ) | ||||||||||||||
LCH |
BAML 30 yr USD-ICE- 3-month LIBOR | 620,000 | 2.480% | (1.015%) | 1/11/47 | | 23,086 |
88 |
Counterparty |
Swap Referenced Obligation |
Notional Value3 | Fixed Interest Rate Paid (Received) |
Variable Interest Rate Paid (Received) |
Termination Date |
Upfront Payments Paid (Received) |
Unrealized Appreciation (Depreciation)4 |
|||||||||||||||||||
LCH |
BAML 7 yr USD-ICE- 3-month LIBOR |
|
3,260,000 |
|
|
2.125% |
|
|
(1.038%) |
|
|
1/25/24 |
|
$ |
|
|
$ |
17,016 |
| |||||||
LCH |
BAML JPMC 30 yr USD-ICE-3-month LIBOR |
|
885,000 |
|
|
2.715% |
|
|
(1.156%) |
|
|
12/22/46 |
|
|
|
|
|
(12,316 |
) | |||||||
LCH |
CSFB 30 yr USD-ICE- 3-month LIBOR |
|
16,600,000 |
|
|
2.250% |
|
|
(1.131%) |
|
|
6/15/46 |
|
|
(1,106,464 |
) |
|
1,644,082 |
| |||||||
LCH |
CSFB 7 yr USD-ICE- 3-month LIBOR |
|
42,500,000 |
|
|
2.250% |
|
|
(1.137%) |
|
|
12/16/22 |
|
|
317,758 |
|
|
(624,558 |
) | |||||||
|
|
|||||||||||||||||||||||||
$ | 1,972,465 | |||||||||||||||||||||||||
|
|
The use of foreign currency exchange contracts, futures contracts, and swap contracts involves elements of market risk and risks in excess of the amounts disclosed in these financial statements. The foreign currency exchange contracts and notional values presented above represent the Funds total exposure in such contracts, whereas only the net unrealized appreciation (depreciation) is reflected in the Funds net assets.
Reverse Repurchase Agreement10
Counterparty |
Interest Rate |
Trade Date |
Maturity Date |
Face Value |
Repurchase Price |
|||||||||||||||
MLP - U.S. Treasury Note 1.125% 1/31/19 |
1.00% | 3/30/17 | 4/6/17 | $ | (2,400,000 | ) | $ | (2,400,467 | ) |
The type of underlying collateral and the remaining maturity of open reverse repurchase agreement in relation to the reverse repurchase agreement is as follows:
Remaining Contracted Maturity of the Agreement
Reverse Repurchase Agreement |
Up to 30 days |
Total | ||||
U.S. Treasury Note |
$(2,400,000) | $(2,400,000) |
Unfunded Loan Commitments11
The Fund may invest in floating rate loans. In connection with these investments, the Fund may also enter into unfunded corporate loan commitments (commitments). Commitments may obligate the Fund to furnish temporary financing to a borrower until permanent financing can be arranged. In connection with these commitments, the Fund earns a commitment fee, typically set as a percentage of the commitment amount. The following unfunded loan commitments were outstanding at March 31, 2017:
Borrower | Principal Amount |
Cost | Value | Unrealized Appreciation (Depreciation) |
||||||||||||
Allied Universal |
||||||||||||||||
Holdco |
||||||||||||||||
5.50% 7/28/22 |
$ 104,387 | $ 102,732 | $ 105,248 | $ 2,516 | ||||||||||||
CenturyLink |
||||||||||||||||
6.034% 2/23/18 |
1,700,000 | 1,691,500 | 1,700,000 | 8,500 | ||||||||||||
CH Hold |
||||||||||||||||
0.50% 2/1/24 |
40,909 | 40,807 | 41,259 | 452 | ||||||||||||
Total |
$1,845,296 | $1,835,039 | $1,846,507 | $11,468 |
(continues) | 89 |
Schedules of investments
Optimum Fixed Income Fund
90 |
(continues) | 91 |
Schedules of investments
Optimum International Fund
March 31, 2017
92 |
(continues) | 93 |
Schedules of investments
Optimum International Fund
94 |
(continues) | 95 |
Schedules of investments
Optimum International Fund
96 |
Optimum Large Cap Growth Fund
March 31, 2017
(continues) | 97 |
Schedules of investments
Optimum Large Cap Growth Fund
98 |
(continues) | 99 |
Schedules of investments
Optimum Large Cap Growth Fund
100 |
Optimum Large Cap Value Fund
March 31, 2017
(continues) | 101 |
Schedules of investments
Optimum Large Cap Value Fund
102 |
103 |
Schedules of investments
Optimum Small-Mid Cap Growth Fund
March 31, 2017
104 |
(continues) | 105 |
Schedules of investments
Optimum Small-Mid Cap Growth Fund
106 |
(continues) | 107 |
Schedules of investments
Optimum Small-Mid Cap Value Fund
March 31, 2017
108 |
(continues) | 109 |
Schedules of investments
Optimum Small-Mid Cap Value Fund
110 |
111 |
Statements of assets and liabilities
Optimum Fund Trust
March 31, 2017
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund |
|||||||||||||||||||
Assets: |
||||||||||||||||||||||||
Investments, at value1,2 |
$ | 1,998,296,233 | $ | 556,006,698 | $ | 1,453,522,908 | $ | 1,321,818,724 | $ | 434,578,413 | $ | 419,889,508 | ||||||||||||
Short-term investments, at value3 |
173,718,136 | 5,021,664 | 21,848,000 | 17,351,535 | 10,699,068 | 942,439 | ||||||||||||||||||
Short-term investments held as collateral for loaned securities, at value4 |
| 19,091,711 | | | | | ||||||||||||||||||
Cash collateral due from brokers |
4,738,554 | | | | | | ||||||||||||||||||
Cash |
2,772,682 | 108,252 | 450,263 | 547,479 | | | ||||||||||||||||||
Foreign currencies, at value5 |
2,021,578 | 313,256 | | 15,708 | | | ||||||||||||||||||
Receivable for securities sold |
159,165,737 | | 25,874,020 | 6,369,094 | 2,404,513 | 5,122,426 | ||||||||||||||||||
Dividends and interest receivable |
12,551,484 | 2,764,787 | 562,746 | 1,762,878 | 155,214 | 574,550 | ||||||||||||||||||
Unrealized appreciation of interest rate swap contracts |
2,898,329 | | | | | | ||||||||||||||||||
Receivable for fund shares sold |
2,265,359 | 671,443 | 1,625,713 | 1,623,264 | 563,613 | 580,815 | ||||||||||||||||||
Unrealized appreciation of foreign currency exchange contracts |
1,367,637 | | | | | | ||||||||||||||||||
Unrealized appreciation of credit default swap contracts |
991,235 | | | | | | ||||||||||||||||||
Variation margin due from broker on futures contracts |
731,699 | | | | | | ||||||||||||||||||
Swap payments receivable |
142,379 | | | | | | ||||||||||||||||||
Securities lending income receivable |
| 16,246 | | | | | ||||||||||||||||||
Foreign tax reclaims receivable |
| 861,341 | 27,617 | 363,891 | | | ||||||||||||||||||
Upfront payments paid on interest rate swap contracts |
2,241,732 | | | | | | ||||||||||||||||||
Upfront payments paid on credit default swap contracts |
191,765 | | | | | | ||||||||||||||||||
Other assets6 |
415,736 | | | | | | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total assets |
2,364,510,275 | 584,855,398 | 1,503,911,267 | 1,349,852,573 | 448,400,821 | 427,109,738 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
112
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund |
|||||||||||||||||||
Liabilities: |
||||||||||||||||||||||||
Reverse repurchase agreement payable |
$ | 2,400,000 | $ | | $ | | $ | | $ | | $ | | ||||||||||||
Options written, at value7 |
701,385 | | | | | | ||||||||||||||||||
Cash overdraft |
| | | | 428,331 | 578,587 | ||||||||||||||||||
Payable for securities purchased |
461,947,831 | 671,291 | 15,167,505 | 5,155,658 | 4,732,855 | 710,819 | ||||||||||||||||||
Cash collateral due to brokers |
2,852,000 | | | | | | ||||||||||||||||||
Payable for fund shares redeemed |
1,830,234 | 463,103 | 1,221,685 | 1,194,192 | 378,617 | 379,350 | ||||||||||||||||||
Swap payments payable |
589,522 | | | | | | ||||||||||||||||||
Dividend disbursing and transfer agent fees payable |
319,900 | 96,484 | 252,627 | 231,266 | 74,872 | 72,506 | ||||||||||||||||||
Variation margin due to brokers on centrally cleared interest rate swap contracts |
105,256 | | | | | | ||||||||||||||||||
Variation margin due to brokers on centrally cleared credit default swap contracts |
2,777 | | | | | | ||||||||||||||||||
Interest payable for reverse repurchase agreements |
607 | | | | | | ||||||||||||||||||
Obligation to return securities lending collateral |
| 19,077,705 | | | | | ||||||||||||||||||
Investment management fees payable to affiliates |
829,492 | 372,764 | 920,331 | 730,753 | 334,449 | 308,814 | ||||||||||||||||||
Other accrued expenses |
654,258 | 280,904 | 366,595 | 338,474 | 136,744 | 114,534 | ||||||||||||||||||
Administration expenses payable to affiliates |
143,814 | 56,446 | 120,269 | 112,793 | 44,924 | 43,504 | ||||||||||||||||||
Distribution fees payable to affiliates |
112,718 | 27,176 | 96,465 | 88,861 | 15,281 | 13,150 | ||||||||||||||||||
Trustees fees and expenses payable to affiliates |
51,069 | 15,392 | 40,287 | 36,397 | 11,993 | 11,524 | ||||||||||||||||||
Accounting fees payable to affiliates |
11,434 | 3,449 | 9,030 | 8,266 | 2,676 | 2,592 | ||||||||||||||||||
Upfront receipts on interest rate swap contracts |
3,160,762 | | | | | | ||||||||||||||||||
Upfront receipts on credit default swap contracts |
1,922,466 | | | | | | ||||||||||||||||||
Unrealized depreciation of foreign currency exchange contracts |
1,101,958 | 530 | | | | | ||||||||||||||||||
Unrealized depreciation of interest rate swap contracts |
820,608 | | | | | | ||||||||||||||||||
Unrealized depreciation of credit default swap contracts |
403,722 | | | | | | ||||||||||||||||||
Bond proceeds payable6 |
1,385,788 | | | | | | ||||||||||||||||||
Other liabilities |
11,581 | 134,816 | | | | | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total liabilities |
481,359,182 | 21,200,060 | 18,194,794 | 7,896,660 | 6,160,742 | 2,235,380 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total Net Assets |
$ | 1,883,151,093 | $ | 563,655,338 | $ | 1,485,716,473 | $ | 1,341,955,913 | $ | 442,240,079 | $ | 424,874,358 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net Assets Consist of: |
|
|||||||||||||||||||||||
Paid-in capital |
$ | 1,905,050,974 | $ | 545,624,793 | $ | 1,128,928,892 | $ | 1,098,748,396 | $ | 368,909,369 | $ | 335,338,237 | ||||||||||||
Undistributed (accumulated) net investment income (loss) |
13,181,364 | 1,599,942 | | 3,293,407 | (1,114,999 | ) | 1,701,989 | |||||||||||||||||
Accumulated net realized gain (loss) |
(42,555,678 | ) | (21,181,051 | ) | 50,168,461 | 40,192,990 | 41,667 | 6,892,253 | ||||||||||||||||
Net unrealized appreciation of investments |
2,535,499 | 37,760,442 | 306,620,591 | 199,741,054 | 74,404,042 | 80,941,879 | ||||||||||||||||||
Net unrealized depreciation of foreign currencies |
(7,225 | ) | (148,258 | ) | (1,471 | ) | (19,934 | ) | | | ||||||||||||||
Net unrealized appreciation (depreciation) of foreign currency exchange contracts |
265,679 | (530 | ) | | | | | |||||||||||||||||
Net unrealized appreciation of futures contracts |
2,529,328 | | | | | | ||||||||||||||||||
Net unrealized depreciation of options purchased |
(493,456 | ) | ||||||||||||||||||||||
Net unrealized appreciation of options written |
516,329 | | | | | | ||||||||||||||||||
Net unrealized appreciation of swap contracts |
2,128,279 | | | | | | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total Net Assets |
$ | 1,883,151,093 | $ | 563,655,338 | $ | 1,485,716,473 | $ | 1,341,955,913 | $ | 442,240,079 | $ | 424,874,358 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(continues) | 113 |
Statements of assets and liabilities
Optimum Fund Trust
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund |
|||||||||||||||||||
Net Asset Value |
|
|||||||||||||||||||||||
Class A: |
||||||||||||||||||||||||
Net assets |
$ | 33,838,055 | $ | 8,680,265 | $ | 32,214,755 | $ | 28,739,366 | $ | 5,292,917 | $ | 4,279,389 | ||||||||||||
Shares of beneficial interest outstanding, unlimited authorization, no par |
3,602,048 | 707,371 | 1,913,398 | 1,863,360 | 397,802 | 310,874 | ||||||||||||||||||
Net asset value per share |
$ | 9.39 | $ | 12.27 | $ | 16.84 | $ | 15.42 | $ | 13.31 | $ | 13.77 | ||||||||||||
Sales charge |
4.50 | % | 5.75 | % | 5.75 | % | 5.75 | % | 5.75 | % | 5.75 | % | ||||||||||||
Offering price per share, equal to net asset value per share / (1 sales charge) |
$ | 9.83 | $ | 13.02 | $ | 17.87 | $ | 16.36 | $ | 14.12 | $ | 14.61 | ||||||||||||
Class C: |
||||||||||||||||||||||||
Net assets |
$ | 124,024,135 | $ | 29,544,526 | $ | 105,082,273 | $ | 95,495,129 | $ | 16,667,720 | $ | 14,267,782 | ||||||||||||
Shares of beneficial interest outstanding, unlimited authorization, no par |
13,216,480 | 2,466,621 | 7,093,812 | 6,262,382 | 1,438,213 | 1,168,323 | ||||||||||||||||||
Net asset value per share |
$ | 9.38 | $ | 11.98 | $ | 14.81 | $ | 15.25 | $ | 11.59 | $ | 12.21 | ||||||||||||
Institutional Class: |
||||||||||||||||||||||||
Net assets |
$ | 1,725,288,903 | $ | 525,430,547 | $ | 1,348,419,445 | $ | 1,217,721,418 | $ | 420,279,442 | $ | 406,327,187 | ||||||||||||
Shares of beneficial interest outstanding, unlimited authorization, no par |
183,760,473 | 42,533,735 | 75,725,300 | 78,777,220 | 29,626,226 | 27,979,463 | ||||||||||||||||||
Net asset value per share |
$ | 9.39 | $ | 12.35 | $ | 17.81 | $ | 15.46 | $ | 14.19 | $ | 14.52 | ||||||||||||
|
||||||||||||||||||||||||
1 Investments, at cost |
$ | 1,996,258,906 | $ | 518,248,296 | $ | 1,146,902,317 | $ | 1,122,078,077 | $ | 360,174,179 | $ | 338,947,641 | ||||||||||||
2 Including securities on loan |
| 26,639,200 | | | | | ||||||||||||||||||
3 Short-term investments, at cost |
173,713,385 | 5,021,744 | 21,848,000 | 17,351,128 | 10,699,260 | 942,427 | ||||||||||||||||||
4 Short-term investments held as collateral for loaned securities, at cost |
| 19,089,591 | | | | | ||||||||||||||||||
5 Foreign currencies, at cost |
2,026,067 | 309,114 | | 15,667 | | | ||||||||||||||||||
6 See Note 13 in Notes to financial statements. |
(970,052 | ) | | | | | | |||||||||||||||||
7 Premium received |
(1,217,714 | ) | | | | | |
See accompanying notes, which are an integral part of the financial statements.
114 |
Optimum Fund Trust
Year ended March 31, 2017
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund |
|||||||||||||||||||
Investment Income: |
||||||||||||||||||||||||
Interest |
$ | 66,148,158 | $ | 13,838 | $ | 87,529 | $ | 71,232 | $ | 27,207 | $ | 13,518 | ||||||||||||
Dividends |
224,177 | 14,945,370 | 14,623,551 | 32,690,104 | 1,785,432 | 9,070,505 | ||||||||||||||||||
Securities lending income |
| 180,863 | | | | | ||||||||||||||||||
Foreign tax withheld |
(11,341 | ) | (1,362,160 | ) | (15,706 | ) | (110,626 | ) | (4,243 | ) | (1,358 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
66,360,994 | 13,777,911 | 14,695,374 | 32,650,710 | 1,808,396 | 9,082,665 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Expenses: |
||||||||||||||||||||||||
Management fees |
10,881,235 | 4,417,359 | 10,896,027 | 9,573,320 | 4,734,712 | 4,287,247 | ||||||||||||||||||
Distribution expenses Class A |
93,820 | 22,592 | 82,709 | 75,456 | 13,185 | 11,031 | ||||||||||||||||||
Distribution expenses Class C |
1,403,125 | 303,762 | 1,079,611 | 995,891 | 167,176 | 147,061 | ||||||||||||||||||
Dividend disbursing and transfer agent fees and expenses |
4,080,764 | 1,170,842 | 2,997,844 | 2,776,697 | 887,861 | 873,431 | ||||||||||||||||||
Administration expenses |
1,784,623 | 668,303 | 1,407,986 | 1,331,753 | 516,514 | 507,720 | ||||||||||||||||||
Accounting fees |
733,547 | 208,329 | 537,833 | 497,895 | 156,798 | 154,130 | ||||||||||||||||||
Reports and statements to shareholders expenses |
385,796 | 113,552 | 273,117 | 319,392 | 84,173 | 131,876 | ||||||||||||||||||
Trustees fees and expenses |
218,972 | 62,809 | 160,911 | 149,948 | 47,869 | 46,990 | ||||||||||||||||||
Custodian fees |
211,341 | 155,419 | 68,967 | 63,859 | 43,188 | 21,913 | ||||||||||||||||||
Professional fees |
203,812 | 78,632 | 140,362 | 118,511 | 80,933 | 52,844 | ||||||||||||||||||
Pricing fees |
135,963 | 32,947 | 1,127 | 1,488 | 1,004 | 885 | ||||||||||||||||||
Registration fees |
75,415 | 54,541 | 63,657 | 62,849 | 55,692 | 53,795 | ||||||||||||||||||
Insurance fees |
40,986 | 10,679 | 29,868 | 25,679 | 9,331 | 8,873 | ||||||||||||||||||
Interest expense |
5,523 | | | | | | ||||||||||||||||||
Tax services |
1,771 | 38,028 | 2,434 | 733 | 874 | 511 | ||||||||||||||||||
Other |
23,544 | 9,799 | 18,592 | 18,071 | 8,964 | 10,388 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
20,280,237 | 7,347,593 | 17,761,045 | 16,011,542 | 6,808,274 | 6,308,695 | |||||||||||||||||||
Less expenses waived |
(244,551 | ) | | (408,030 | ) | (178,075 | ) | (888,915 | ) | (832,874 | ) | |||||||||||||
Less expense paid indirectly |
(843 | ) | (823 | ) | (927 | ) | (929 | ) | (906 | ) | (913 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total operating expenses |
20,034,843 | 7,346,770 | 17,352,088 | 15,832,538 | 5,918,453 | 5,474,908 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net Investment Income (Loss) |
46,326,151 | 6,431,141 | (2,656,714 | ) | 16,818,172 | (4,110,057 | ) | 3,607,757 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(continues) | 115 |
Statements of operations
Optimum Fund Trust
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund |
|||||||||||||||||||
Net Realized and Unrealized Gain (Loss): |
||||||||||||||||||||||||
Net realized gain (loss) on: |
||||||||||||||||||||||||
Investments1 |
$ | 7,992,078 | $ | 6,829,604 | $ | 102,466,450 | $ | 221,783,804 | $ | 19,561,084 | $ | 34,020,737 | ||||||||||||
Foreign currencies |
(4,573,028 | ) | 242,644 | 210 | (137,412 | ) | (4,747 | ) | | |||||||||||||||
Foreign currency exchange contracts |
3,099,794 | (211,679 | ) | 86,479 | (2,644 | ) | 6,831 | | ||||||||||||||||
Futures contracts |
(13,948,762 | ) | | | | | | |||||||||||||||||
Options purchased |
(157,060 | ) | | | | | | |||||||||||||||||
Options written |
1,954,209 | | | | | | ||||||||||||||||||
Swap contracts |
(2,812,669 | ) | | | | | | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net realized gain (loss) |
(8,445,438 | ) | 6,860,569 | 102,553,139 | 221,643,748 | 19,563,168 | 34,020,737 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net change in unrealized appreciation (depreciation) of: |
||||||||||||||||||||||||
Investments2 |
(12,146,514 | ) | 58,274,025 | 131,161,619 | (43,645,912 | ) | 68,639,734 | 38,728,388 | ||||||||||||||||
Foreign currencies |
91,880 | (153,559 | ) | (283 | ) | (11,380 | ) | 183 | | |||||||||||||||
Foreign currency exchange contracts |
2,823,705 | (509 | ) | | | | | |||||||||||||||||
Futures contracts |
4,565,500 | | | | | | ||||||||||||||||||
Options purchased |
321,608 | | | | | | ||||||||||||||||||
Options written |
(298,864 | ) | | | | | | |||||||||||||||||
Swap contracts |
13,264,658 | | | | | | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net change in unrealized appreciation (depreciation) |
8,621,973 | 58,119,957 | 131,161,336 | (43,657,292 | ) | 68,639,917 | 38,728,388 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net Realized and Unrealized Gain |
176,535 | 64,980,526 | 233,714,475 | 177,986,456 | 88,203,085 | 72,749,125 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net Increase in Net Assets Resulting from Operations |
$ | 46,502,686 | $ | 71,411,667 | $ | 231,057,761 | $ | 194,804,628 | $ | 84,093,028 | $ | 76,356,882 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
1Includes $25,140 capital gain taxes paid for Optimum Fixed Income Fund.
2Includes $11,503 and $119,254 capital gain taxes accrued for Optimum Fixed Income Fund and Optimum International Fund, respectively.
See accompanying notes, which are an integral part of the financial statements.
116
Statements of changes in net assets
Optimum Fund Trust
Optimum Fixed Income Fund | Optimum International Fund | |||||||||||||||
Year ended | Year ended | |||||||||||||||
3/31/17 | 3/31/16 | 3/31/17 | 3/31/16 | |||||||||||||
Increase (Decrease) in Net Assets from Operations: |
||||||||||||||||
Net investment income |
$ | 46,326,151 | $ | 47,403,894 | $ | 6,431,141 | $ | 5,015,942 | ||||||||
Net realized gain (loss) |
(8,445,438 | ) | (27,629,119 | ) | 6,860,569 | (10,956,221 | ) | |||||||||
Net change in unrealized appreciation (depreciation) |
8,621,973 | (30,091,919 | ) | 58,119,957 | (23,203,947 | ) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net increase (decrease) in net assets resulting from operations |
46,502,686 | (10,317,144 | ) | 71,411,667 | (29,144,226 | ) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Dividends and Distributions to Shareholders from: |
||||||||||||||||
Net investment income: |
||||||||||||||||
Class A |
(676,539 | ) | (1,085,313 | ) | (80,080 | ) | (50,629 | ) | ||||||||
Class C |
(1,524,429 | ) | (3,029,706 | ) | (65,461 | ) | | |||||||||
Institutional Class |
(37,864,252 | ) | (54,756,893 | ) | (5,899,992 | ) | (4,309,148 | ) | ||||||||
Net realized gain: |
||||||||||||||||
Class A |
| (85,457 | ) | | | |||||||||||
Class C |
| (332,935 | ) | | | |||||||||||
Institutional Class |
| (3,939,345 | ) | | | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
(40,065,220 | ) | (63,229,649 | ) | (6,045,533 | ) | (4,359,777 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Capital Share Transactions: |
||||||||||||||||
Proceeds from shares sold: |
||||||||||||||||
Class A |
2,615,487 | 4,608,270 | 626,232 | 1,203,348 | ||||||||||||
Class C |
7,193,141 | 20,019,238 | 1,814,846 | 4,103,792 | ||||||||||||
Institutional Class |
378,540,581 | 480,837,856 | 85,837,495 | 183,077,658 | ||||||||||||
Net asset value of shares issued upon reinvestment of dividends and distributions: |
||||||||||||||||
Class A |
674,466 | 1,167,080 | 79,845 | 50,419 | ||||||||||||
Class C |
1,523,427 | 3,361,112 | 65,389 | | ||||||||||||
Institutional Class |
37,826,389 | 58,657,351 | 5,894,688 | 4,306,426 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
428,373,491 | 568,650,907 | 94,318,495 | 192,741,643 | |||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Cost of shares redeemed: |
||||||||||||||||
Class A |
(9,136,395 | ) | (7,872,126 | ) | (2,172,483 | ) | (1,788,908 | ) | ||||||||
Class C |
(38,409,617 | ) | (30,460,309 | ) | (7,546,843 | ) | (5,982,044 | ) | ||||||||
Institutional Class |
(589,700,192 | ) | (406,639,728 | ) | (169,259,362 | ) | (92,688,776 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
(637,246,204 | ) | (444,972,163 | ) | (178,978,688 | ) | (100,459,728 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Increase (decrease) in net assets derived from capital share transactions |
(208,872,713 | ) | 123,678,744 | (84,660,193 | ) | 92,281,915 | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net Increase (Decrease) in Net Assets |
(202,435,247 | ) | 50,131,951 | (19,294,059 | ) | 58,777,912 | ||||||||||
Net Assets: |
||||||||||||||||
Beginning of year |
2,085,586,340 | 2,035,454,389 | 582,949,397 | 524,171,485 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
End of year |
$ | 1,883,151,093 | $ | 2,085,586,340 | $ | 563,655,338 | $ | 582,949,397 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Undistributed net investment income |
$ | 13,181,364 | $ | 5,660,130 | $ | 1,599,942 | $ | 1,160,288 | ||||||||
|
|
|
|
|
|
|
|
See accompanying notes, which are an integral part of the financial statements.
(continues) | 117 |
Statements of changes in net assets
Optimum Fund Trust
Optimum Large Cap Growth Fund | Optimum Large Cap Value Fund | |||||||||||||||
Year ended | Year ended | |||||||||||||||
3/31/17 | 3/31/16 | 3/31/17 | 3/31/16 | |||||||||||||
Increase (Decrease) in Net Assets from Operations: |
||||||||||||||||
Net investment income (loss) |
$ | (2,656,714 | ) | $ | (7,209,710 | ) | $ | 16,818,172 | $ | 15,708,179 | ||||||
Net realized gain |
102,553,139 | 96,753,459 | 221,643,748 | 1,430,982 | ||||||||||||
Net change in unrealized appreciation (depreciation) |
131,161,336 | (122,893,611 | ) | (43,657,292 | ) | (75,770,012 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Net increase (decrease) in net assets resulting from operations |
231,057,761 | (33,349,862 | ) | 194,804,628 | (58,630,851 | ) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Dividends and Distributions to Shareholders from: |
||||||||||||||||
Net investment income: |
||||||||||||||||
Class A |
| | (322,766 | ) | (321,261 | ) | ||||||||||
Class C |
| | (382,046 | ) | (274,376 | ) | ||||||||||
Institutional Class |
| | (16,045,433 | ) | (14,327,950 | ) | ||||||||||
Net realized gain: |
||||||||||||||||
Class A |
(1,203,358 | ) | (3,719,537 | ) | (3,180,253 | ) | | |||||||||
Class C |
(4,316,642 | ) | (13,957,426 | ) | (10,410,746 | ) | | |||||||||
Institutional Class |
(45,828,776 | ) | (136,563,101 | ) | (129,552,015 | ) | | |||||||||
|
|
|
|
|
|
|
|
|||||||||
(51,348,776 | ) | (154,240,064 | ) | (159,893,259 | ) | (14,923,587 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Capital Share Transactions: |
||||||||||||||||
Proceeds from shares sold: |
||||||||||||||||
Class A |
1,584,659 | 2,170,167 | 1,599,717 | 2,199,582 | ||||||||||||
Class C |
4,926,393 | 8,435,040 | 5,099,592 | 8,104,091 | ||||||||||||
Institutional Class |
227,791,648 | 290,002,877 | 320,762,276 | 254,483,230 | ||||||||||||
Net asset value of shares issued upon reinvestment of dividends and distributions: |
||||||||||||||||
Class A |
1,200,552 | 3,677,396 | 3,494,971 | 317,257 | ||||||||||||
Class C |
4,311,583 | 13,948,506 | 10,774,076 | 274,091 | ||||||||||||
Institutional Class |
45,764,351 | 136,409,018 | 145,399,962 | 14,310,905 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
285,579,186 | 454,643,004 | 487,130,594 | 279,689,156 | |||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Cost of shares redeemed: |
||||||||||||||||
Class A |
(8,255,058 | ) | (8,356,642 | ) | (7,586,746 | ) | (6,085,917 | ) | ||||||||
Class C |
(30,464,822 | ) | (27,572,016 | ) | (26,404,995 | ) | (20,750,036 | ) | ||||||||
Institutional Class |
(445,881,165 | ) | (317,836,544 | ) | (409,895,778 | ) | (220,344,722 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
(484,601,045 | ) | (353,765,202 | ) | (443,887,519 | ) | (247,180,675 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Increase (decrease) in net assets derived from capital share transactions |
(199,021,859 | ) | 100,877,802 | 43,243,075 | 32,508,481 | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net Increase (Decrease) in Net Assets |
(19,312,874 | ) | (86,712,124 | ) | 78,154,444 | (41,045,957 | ) | |||||||||
Net Assets: |
||||||||||||||||
Beginning of year |
1,505,029,347 | 1,591,741,471 | 1,263,801,469 | 1,304,847,426 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
End of year |
$ | 1,485,716,473 | $ | 1,505,029,347 | $ | 1,341,955,913 | $ | 1,263,801,469 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Undistributed (accumulated) net investment income (loss) |
$ | | $ | (1,408,686 | ) | $ | 3,293,407 | $ | 3,365,536 | |||||||
|
|
|
|
|
|
|
|
See accompanying notes, which are an integral part of the financial statements.
118
Optimum Small-Mid Cap Growth Fund | Optimum Small-Mid Cap Value Fund | |||||||||||||||
Year ended | Year ended | |||||||||||||||
3/31/17 | 3/31/16 | 3/31/17 | 3/31/16 | |||||||||||||
Increase (Decrease) in Net Assets from Operations: |
||||||||||||||||
Net investment income (loss) |
$ | (4,110,057 | ) | $ | (4,546,430 | ) | $ | 3,607,757 | $ | (655,163 | ) | |||||
Net realized gain (loss) |
19,563,168 | 22,927,598 | 34,020,737 | (16,532,077 | ) | |||||||||||
Net change in unrealized appreciation (depreciation) |
68,639,917 | (111,069,637 | ) | 38,728,388 | (45,591,581 | ) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net increase (decrease) in net assets resulting from operations |
84,093,028 | (92,688,469 | ) | 76,356,882 | (62,778,821 | ) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Dividends and Distributions to Shareholders from: |
||||||||||||||||
Net investment income: |
||||||||||||||||
Class A |
| | (16,209 | ) | | |||||||||||
Institutional Class |
| | (2,284,918 | ) | | |||||||||||
Return of capital: |
||||||||||||||||
Class A |
| (108 | ) | | (325 | ) | ||||||||||
Class C |
| (416 | ) | | (1,284 | ) | ||||||||||
Institutional Class |
| (8,917 | ) | | (31,607 | ) | ||||||||||
Net realized gain: |
||||||||||||||||
Class A |
| (848,264 | ) | | (181,566 | ) | ||||||||||
Class C |
| (3,111,096 | ) | | (716,111 | ) | ||||||||||
Institutional Class |
| (64,692,634 | ) | | (16,831,364 | ) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
| (68,661,435 | ) | (2,301,127 | ) | (17,762,257 | ) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Capital Share Transactions: |
||||||||||||||||
Proceeds from shares sold: |
||||||||||||||||
Class A |
420,894 | 451,922 | 372,174 | 413,183 | ||||||||||||
Class C |
1,008,435 | 1,541,727 | 624,715 | 1,260,654 | ||||||||||||
Institutional Class |
78,489,396 | 118,186,291 | 76,824,883 | 116,775,502 | ||||||||||||
Net asset value of shares issued upon reinvestment of dividends and distributions: |
||||||||||||||||
Class A |
| 837,719 | 16,178 | 181,312 | ||||||||||||
Class C |
| 3,109,916 | | 716,788 | ||||||||||||
Institutional Class |
| 64,636,607 | 2,282,053 | 16,847,228 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
79,918,725 | 188,764,182 | 80,120,003 | 136,194,667 | |||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Cost of shares redeemed: |
||||||||||||||||
Class A |
(1,198,557 | ) | (1,341,729 | ) | (1,195,842 | ) | (923,567 | ) | ||||||||
Class C |
(4,441,565 | ) | (3,951,373 | ) | (4,032,657 | ) | (3,003,693 | ) | ||||||||
Institutional Class |
(178,827,032 | ) | (117,328,470 | ) | (184,660,997 | ) | (115,400,981 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
(184,467,154 | ) | (122,621,572 | ) | (189,889,496 | ) | (119,328,241 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Increase (decrease) in net assets derived from capital share transactions |
(104,548,429 | ) | 66,142,610 | (109,769,493 | ) | 16,866,426 | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net Decrease in Net Assets |
(20,455,401 | ) | (95,207,294 | ) | (35,713,738 | ) | (63,674,652 | ) | ||||||||
Net Assets: |
||||||||||||||||
Beginning of year |
462,695,480 | 557,902,774 | 460,588,096 | 524,262,748 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
End of year |
$ | 442,240,079 | $ | 462,695,480 | $ | 424,874,358 | $ | 460,588,096 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Undistributed (accumulated) net investment income (loss) |
$ | (1,114,999 | ) | $ | (1,156,797 | ) | $ | 1,701,989 | $ | (167,745 | ) | |||||
|
|
|
|
|
|
|
|
See accompanying notes, which are an integral part of the financial statements.
(continues) | 119 |
Optimum Fixed Income Fund Class A
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 9.370 | $ | 9.720 | $ | 9.540 | $ | 9.850 | $ | 9.710 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment income1 |
0.201 | 0.202 | 0.203 | 0.213 | 0.225 | |||||||||||||||
Net realized and unrealized gain (loss) |
(0.004 | ) | (0.278 | ) | 0.194 | (0.353 | ) | 0.302 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
0.197 | (0.076 | ) | 0.397 | (0.140 | ) | 0.527 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Net investment income |
(0.177 | ) | (0.254 | ) | (0.217 | ) | (0.142 | ) | (0.172 | ) | ||||||||||
Net realized gain |
| (0.020 | ) | | (0.028 | ) | (0.215 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
(0.177 | ) | (0.274 | ) | (0.217 | ) | (0.170 | ) | (0.387 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 9.390 | $ | 9.370 | $ | 9.720 | $ | 9.540 | $ | 9.850 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return2 |
2.03% | (0.63% | ) | 4.21% | (1.40% | ) | 5.47% | |||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 33,838 | $ | 39,545 | $ | 43,144 | $ | 43,241 | $ | 41,210 | ||||||||||
Ratio of expenses to average net assets |
1.17% | 1.23% | 1.17% | 1.31% | 1.35% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
1.18% | 1.23% | 1.17% | 1.34% | 1.40% | |||||||||||||||
Ratio of net investment income to average net assets |
2.12% | 2.13% | 2.11% | 2.24% | 2.27% | |||||||||||||||
Ratio of net investment income to average net assets prior to fees waived |
2.11% | 2.13% | 2.11% | 2.21% | 2.22% | |||||||||||||||
Portfolio turnover |
419% | 536% | 482%3 | 323%3 | 208% |
1 | The average shares outstanding method has been applied for per share information. |
2 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return during some of the periods reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
3 | As a result of the addition of Delaware Management Companys diversified floating rate investment strategy and Pacific Investment Management Company, LLC s low-duration investment strategy on Feb. 1, 2014, to the Funds principal investment strategy, the Funds portfolio turnover rate increased substantially during the years ended March 31, 2015 and 2014. |
See accompanying notes, which are an integral part of the financial statements.
120 |
Optimum Fixed Income Fund Class C
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 9.370 | $ | 9.710 | $ | 9.530 | $ | 9.840 | $ | 9.710 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment income1 |
0.130 | 0.131 | 0.131 | 0.148 | 0.161 | |||||||||||||||
Net realized and unrealized gain (loss) |
(0.013 | ) | (0.269 | ) | 0.194 | (0.351 | ) | 0.292 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
0.117 | (0.138 | ) | 0.325 | (0.203 | ) | 0.453 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Net investment income |
(0.107 | ) | (0.182 | ) | (0.145 | ) | (0.079 | ) | (0.108 | ) | ||||||||||
Net realized gain |
| (0.020 | ) | | (0.028 | ) | (0.215 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
(0.107 | ) | (0.202 | ) | (0.145 | ) | (0.107 | ) | (0.323 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 9.380 | $ | 9.370 | $ | 9.710 | $ | 9.530 | $ | 9.840 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return2 |
1.27% | (1.39% | ) | 3.44% | (2.06% | ) | 4.69% | |||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 124,024 | $ | 153,266 | $ | 166,154 | $ | 161,353 | $ | 155,728 | ||||||||||
Ratio of expenses to average net assets |
1.92% | 1.98% | 1.92% | 1.99% | 2.00% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
1.93% | 1.98% | 1.92% | 2.02% | 2.05% | |||||||||||||||
Ratio of net investment income to average net assets |
1.37% | 1.38% | 1.36% | 1.56% | 1.62% | |||||||||||||||
Ratio of net investment income to average net assets prior to fees waived |
1.36% | 1.38% | 1.36% | 1.53% | 1.57% | |||||||||||||||
Portfolio turnover |
419% | 536% | 482%3 | 323%3 | 208% |
1 | The average shares outstanding method has been applied for per share information. |
2 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return during some of the periods reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
3 | As a result of the addition of Delaware Management Companys diversified floating rate investment strategy and Pacific Investment Management Company, LLC s low-duration investment strategy on Feb. 1, 2014, to the Funds principal investment strategy, the Funds portfolio turnover rate increased substantially during the years ended March 31, 2015 and 2014. |
See accompanying notes, which are an integral part of the financial statements.
(continues) | 121 |
Financial highlights
Optimum Fixed Income Fund Institutional Class
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 9.370 | $ | 9.720 | $ | 9.540 | $ | 9.850 | $ | 9.710 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment income1 |
0.225 | 0.226 | 0.227 | 0.244 | 0.260 | |||||||||||||||
Net realized and unrealized gain (loss) |
(0.004 | ) | (0.278 | ) | 0.194 | (0.350 | ) | 0.301 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
0.221 | (0.052 | ) | 0.421 | (0.106 | ) | 0.561 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Net investment income |
(0.201 | ) | (0.278 | ) | (0.241 | ) | (0.176 | ) | (0.206 | ) | ||||||||||
Net realized gain |
| (0.020 | ) | | (0.028 | ) | (0.215 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
(0.201 | ) | (0.298 | ) | (0.241 | ) | (0.204 | ) | (0.421 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 9.390 | $ | 9.370 | $ | 9.720 | $ | 9.540 | $ | 9.850 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return2 |
2.40% | (0.48% | ) | 4.47% | (1.05% | ) | 5.72% | |||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 1,725,289 | $ | 1,892,775 | $ | 1,826,156 | $ | 1,509,156 | $ | 1,297,154 | ||||||||||
Ratio of expenses to average net assets |
0.92% | 0.98% | 0.92% | 0.99% | 1.00% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
0.93% | 0.98% | 0.92% | 1.02% | 1.05% | |||||||||||||||
Ratio of net investment income to average net assets |
2.37% | 2.38% | 2.36% | 2.56% | 2.62% | |||||||||||||||
Ratio of net investment income to average net assets prior to fees waived |
2.36% | 2.38% | 2.36% | 2.53% | 2.57% | |||||||||||||||
Portfolio turnover |
419% | 536% | 482%3 | 323%3 | 208% |
1 | The average shares outstanding method has been applied for per share information. |
2 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value. Total investment return during some of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
3 | As a result of the addition of Delaware Management Companys diversified floating rate investment strategy and Pacific Investment Management Company, LLC s low-duration investment strategy on Feb. 1, 2014, to the Funds principal investment strategy, the Funds portfolio turnover rate increased substantially during the years ended March 31, 2015 and 2014. |
See accompanying notes, which are an integral part of the financial statements.
122
Optimum International Fund Class A
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 10.950 | $ | 11.660 | $ | 12.570 | $ | 10.970 | $ | 10.420 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment income1 |
0.106 | 0.083 | 0.062 | 0.142 | 0.185 | |||||||||||||||
Net realized and unrealized gain (loss) |
1.318 | (0.734 | ) | (0.846 | ) | 1.540 | 0.620 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
1.424 | (0.651 | ) | (0.784 | ) | 1.682 | 0.805 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Net investment income |
(0.104 | ) | (0.059 | ) | (0.126 | ) | (0.082 | ) | (0.255 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
(0.104 | ) | (0.059 | ) | (0.126 | ) | (0.082 | ) | (0.255 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 12.270 | $ | 10.950 | $ | 11.660 | $ | 12.570 | $ | 10.970 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return2 |
13.08% | (5.58% | ) | (6.25% | ) | 15.31% | 8.10% | |||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 8,680 | $ | 9,117 | $ | 10,291 | $ | 11,277 | $ | 9,553 | ||||||||||
Ratio of expenses to average net assets |
1.48% | 1.56% | 1.47% | 1.68% | 1.75% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
1.48% | 1.56% | 1.47% | 1.68% | 1.84% | |||||||||||||||
Ratio of net investment income to average net assets |
0.93% | 0.74% | 0.51% | 1.20% | 1.81% | |||||||||||||||
Ratio of net investment income to average net assets prior to fees waived |
0.93% | 0.74% | 0.51% | 1.20% | 1.72% | |||||||||||||||
Portfolio turnover |
68% | 47% | 117% | 126% | 70% |
1 | The average shares outstanding method has been applied for per share information. |
2 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return during some of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
See accompanying notes, which are an integral part of the financial statements.
(continues) | 123 |
Financial highlights
Optimum International Fund Class C
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 10.690 | $ | 11.410 | $ | 12.290 | $ | 10.760 | $ | 10.230 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment income (loss)1 |
0.020 | (0.001 | ) | (0.028 | ) | 0.061 | 0.116 | |||||||||||||
Net realized and unrealized gain (loss) |
1.295 | (0.719 | ) | (0.832 | ) | 1.512 | 0.606 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
1.315 | (0.720 | ) | (0.860 | ) | 1.573 | 0.722 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Net investment income |
(0.025 | ) | | (0.020 | ) | (0.043 | ) | (0.192 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
(0.025 | ) | | (0.020 | ) | (0.043 | ) | (0.192 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 11.980 | $ | 10.690 | $ | 11.410 | $ | 12.290 | $ | 10.760 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return2 |
12.32% | (6.31% | ) | (7.00% | ) | 14.56% | 7.37% | |||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 29,544 | $ | 31,777 | $ | 35,996 | $ | 37,893 | $ | 32,064 | ||||||||||
Ratio of expenses to average net assets |
2.23% | 2.31% | 2.22% | 2.36% | 2.40% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
2.23% | 2.31% | 2.22% | 2.36% | 2.49% | |||||||||||||||
Ratio of net investment income (loss) to average net assets |
0.18% | (0.01% | ) | (0.24% | ) | 0.52% | 1.16% | |||||||||||||
Ratio of net investment income (loss) to average net assets prior to fees waived |
0.18% | (0.01% | ) | (0.24% | ) | 0.52% | 1.07% | |||||||||||||
Portfolio turnover |
68% | 47% | 117% | 126% | 70% |
1 | The average shares outstanding method has been applied for per share information. |
2 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return during some of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
See accompanying notes, which are an integral part of the financial statements.
124
Optimum International Fund Institutional Class
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 11.020 | $ | 11.740 | $ | 12.660 | $ | 11.050 | $ | 10.490 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment income1 |
0.136 | 0.111 | 0.093 | 0.182 | 0.223 | |||||||||||||||
Net realized and unrealized gain (loss) |
1.326 | (0.743 | ) | (0.856 | ) | 1.551 | 0.627 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
1.462 | (0.632 | ) | (0.763 | ) | 1.733 | 0.850 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Net investment income |
(0.132 | ) | (0.088 | ) | (0.157 | ) | (0.123 | ) | (0.290 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
(0.132 | ) | (0.088 | ) | (0.157 | ) | (0.123 | ) | (0.290 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 12.350 | $ | 11.020 | $ | 11.740 | $ | 12.660 | $ | 11.050 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return2 |
13.36% | (5.38% | ) | (6.04% | ) | 15.79% | 8.41% | |||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 525,431 | $ | 542,055 | $ | 477,884 | $ | 589,098 | $ | 426,258 | ||||||||||
Ratio of expenses to average net assets |
1.23% | 1.31% | 1.22% | 1.36% | 1.40% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
1.23% | 1.31% | 1.22% | 1.36% | 1.49% | |||||||||||||||
Ratio of net investment income to average net assets |
1.18% | 0.99% | 0.76% | 1.52% | 2.16% | |||||||||||||||
Ratio of net investment income to average net assets prior to fees waived |
1.18% | 0.99% | 0.76% | 1.52% | 2.07% | |||||||||||||||
Portfolio turnover |
68% | 47% | 117% | 126% | 70% |
1 | The average shares outstanding method has been applied for per share information. |
2 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value. Total investment return during some of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
See accompanying notes, which are an integral part of the financial statements.
(continues) | 125 |
Financial highlights
Optimum Large Cap Growth Fund Class A
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 14.970 | $ | 17.000 | $ | 16.390 | $ | 14.530 | $ | 13.480 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment income (loss)1 |
(0.055 | ) | (0.102 | ) | (0.083 | ) | (0.099 | ) | 0.014 | |||||||||||
Net realized and unrealized gain (loss) |
2.515 | (0.200 | ) | 2.711 | 3.631 | 1.042 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
2.460 | (0.302 | ) | 2.628 | 3.532 | 1.056 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Net investment income |
| | | | (0.006 | ) | ||||||||||||||
Net realized gain |
(0.590 | ) | (1.728 | ) | (2.018 | ) | (1.672 | ) | | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
(0.590 | ) | (1.728 | ) | (2.018 | ) | (1.672 | ) | (0.006 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 16.840 | $ | 14.970 | $ | 17.000 | $ | 16.390 | $ | 14.530 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return2 |
16.83% | (2.27% | ) | 17.27% | 25.17% | 7.76% | ||||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 32,215 | $ | 33,787 | $ | 40,790 | $ | 39,044 | $ | 34,182 | ||||||||||
Ratio of expenses to average net assets |
1.35% | 1.42% | 1.37% | 1.54% | 1.60% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
1.38% | 1.44% | 1.37% | 1.55% | 1.63% | |||||||||||||||
Ratio of net investment income (loss) to average net assets |
(0.35% | ) | (0.62% | ) | (0.50% | ) | (0.62% | ) | 0.10% | |||||||||||
Ratio of net investment income (loss) to average net assets prior to fees waived |
(0.38% | ) | (0.64% | ) | (0.50% | ) | (0.63% | ) | 0.07% | |||||||||||
Portfolio turnover |
52% | 88% | 86% | 98% | 102% |
1 | The average shares outstanding method has been applied for per share information. |
2 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return during some of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
See accompanying notes, which are an integral part of the financial statements.
126
Optimum Large Cap Growth Fund Class C
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 13.340 | $ | 15.440 | $ | 15.160 | $ | 13.630 | $ | 12.720 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment loss1 |
(0.152 | ) | (0.203 | ) | (0.189 | ) | (0.192 | ) | (0.069 | ) | ||||||||||
Net realized and unrealized gain (loss) |
2.212 | (0.169 | ) | 2.487 | 3.394 | 0.979 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
2.060 | (0.372 | ) | 2.298 | 3.202 | 0.910 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Net realized gain |
(0.590 | ) | (1.728 | ) | (2.018 | ) | (1.672 | ) | | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
(0.590 | ) | (1.728 | ) | (2.018 | ) | (1.672 | ) | | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 14.810 | $ | 13.340 | $ | 15.440 | $ | 15.160 | $ | 13.630 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return2 |
15.88% | (2.98% | ) | 16.44% | 24.27% | 7.15% | ||||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 105,082 | $ | 114,907 | $ | 137,892 | $ | 127,540 | $ | 115,242 | ||||||||||
Ratio of expenses to average net assets |
2.10% | 2.17% | 2.12% | 2.22% | 2.25% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
2.13% | 2.19% | 2.12% | 2.23% | 2.28% | |||||||||||||||
Ratio of net investment loss to average net assets |
(1.10% | ) | (1.37% | ) | (1.25% | ) | (1.30% | ) | (0.55% | ) | ||||||||||
Ratio of net investment loss to average net assets prior to fees waived |
(1.13% | ) | (1.39% | ) | (1.25% | ) | (1.31% | ) | (0.58% | ) | ||||||||||
Portfolio turnover |
52% | 88% | 86% | 98% | 102% |
1 | The average shares outstanding method has been applied for per share information. |
2 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return during some of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
See accompanying notes, which are an integral part of the financial statements.
(continues) | 127 |
Financial highlights
Optimum Large Cap Growth Fund Institutional Class
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 15.760 | $ | 17.760 | $ | 17.000 | $ | 14.970 | $ | 13.880 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment income (loss)1 |
(0.017 | ) | (0.064 | ) | (0.044 | ) | (0.049 | ) | 0.062 | |||||||||||
Net realized and unrealized gain (loss) |
2.657 | (0.208 | ) | 2.822 | 3.754 | 1.068 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
2.640 | (0.272 | ) | 2.778 | 3.705 | 1.130 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Net investment income |
| | | (0.003 | ) | (0.040 | ) | |||||||||||||
Net realized gain |
(0.590 | ) | (1.728 | ) | (2.018 | ) | (1.672 | ) | | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
(0.590 | ) | (1.728 | ) | (2.018 | ) | (1.675 | ) | (0.040 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 17.810 | $ | 15.760 | $ | 17.760 | $ | 17.000 | $ | 14.970 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return2 |
17.14% | (2.00% | ) | 17.55% | 25.51% | 8.25% | ||||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 1,348,419 | $ | 1,356,335 | $ | 1,413,059 | $ | 1,026,377 | $ | 728,104 | ||||||||||
Ratio of expenses to average net assets |
1.10% | 1.17% | 1.12% | 1.22% | 1.25% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
1.13% | 1.19% | 1.12% | 1.23% | 1.28% | |||||||||||||||
Ratio of net investment income (loss) to average net assets |
(0.10% | ) | (0.37% | ) | (0.25% | ) | (0.30% | ) | 0.45% | |||||||||||
Ratio of net investment income (loss) to average net assets prior to fees waived |
(0.13% | ) | (0.39% | ) | (0.25% | ) | (0.31% | ) | 0.42% | |||||||||||
Portfolio turnover |
52% | 88% | 86% | 98% | 102% |
1 | The average shares outstanding method has been applied for per share information. |
2 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value. Total investment return during some of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
See accompanying notes, which are an integral part of the financial statements.
128
Optimum Large Cap Value Fund Class A
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 15.130 | $ | 16.010 | $ | 15.360 | $ | 12.900 | $ | 11.750 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment income1 |
0.165 | 0.165 | 0.124 | 0.157 | 0.173 | |||||||||||||||
Net realized and unrealized gain (loss) |
2.046 | (0.890 | ) | 0.692 | 2.399 | 1.259 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
2.211 | (0.725 | ) | 0.816 | 2.556 | 1.432 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Net investment income |
(0.177 | ) | (0.155 | ) | (0.166 | ) | (0.096 | ) | (0.282 | ) | ||||||||||
Net realized gain |
(1.744 | ) | | | | | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
(1.921 | ) | (0.155 | ) | (0.166 | ) | (0.096 | ) | (0.282 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 15.420 | $ | 15.130 | $ | 16.010 | $ | 15.360 | $ | 12.900 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return2 |
14.99% | (4.54% | ) | 5.34% | 19.96% | 12.48% | ||||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 28,739 | $ | 30,502 | $ | 35,952 | $ | 37,299 | $ | 32,995 | ||||||||||
Ratio of expenses to average net assets |
1.33% | 1.40% | 1.33% | 1.50% | 1.57% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
1.34% | 1.41% | 1.33% | 1.51% | 1.59% | |||||||||||||||
Ratio of net investment income to average net assets |
1.06% | 1.07% | 0.79% | 1.12% | 1.48% | |||||||||||||||
Ratio of net investment income to average net assets prior to fees waived |
1.05% | 1.06% | 0.79% | 1.11% | 1.46% | |||||||||||||||
Portfolio turnover |
82%3 | 39% | 35% | 37% | 49% |
1 | The average shares outstanding method has been applied for per share information. |
2 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return during some of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
3 | As a result of Rothschild Asset Management Inc. replacing Herdon Capital Management, LLC as one of the sub-advisors to Optimum Large Cap Value Fund during the Funds fiscal year ending March 31, 2017, the Funds portfolio turnover rate increased substantially during the year ended March 31, 2017. |
See accompanying notes, which are an integral part of the financial statements.
(continues) | 129 |
Financial highlights
Optimum Large Cap Value Fund Class C
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 14.990 | $ | 15.850 | $ | 15.220 | $ | 12.780 | $ | 11.590 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment income1 |
0.047 | 0.049 | 0.007 | 0.061 | 0.096 | |||||||||||||||
Net realized and unrealized gain (loss) |
2.021 | (0.871 | ) | 0.674 | 2.389 | 1.254 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
2.068 | (0.822 | ) | 0.681 | 2.450 | 1.350 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Net investment income |
(0.064 | ) | (0.038 | ) | (0.051 | ) | (0.010 | ) | (0.160 | ) | ||||||||||
Net realized gain |
(1.744 | ) | | | | | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
(1.808 | ) | (0.038 | ) | (0.051 | ) | (0.010 | ) | (0.160 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 15.250 | $ | 14.990 | $ | 15.850 | $ | 15.220 | $ | 12.780 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return2 |
14.13% | (5.19% | ) | 4.48% | 19.17% | 11.85% | ||||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 95,495 | $ | 103,693 | $ | 122,772 | $ | 123,541 | $ | 111,806 | ||||||||||
Ratio of expenses to average net assets |
2.08% | 2.15% | 2.08% | 2.18% | 2.22% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
2.09% | 2.16% | 2.08% | 2.19% | 2.24% | |||||||||||||||
Ratio of net investment income to average net assets |
0.31% | 0.32% | 0.04% | 0.44% | 0.83% | |||||||||||||||
Ratio of net investment income to average net assets prior to fees waived |
0.30% | 0.31% | 0.04% | 0.43% | 0.81% | |||||||||||||||
Portfolio turnover |
82%3 | 39% | 35% | 37% | 49% |
1 | The average shares outstanding method has been applied for per share information. |
2 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return during some of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
3 | As a result of Rothschild Asset Management Inc. replacing Herdon Capital Management, LLC as one of the sub-advisors to Optimum Large Cap Value Fund during the Funds fiscal year ending March 31, 2017, the Funds portfolio turnover rate increased substantially during the year ended March 31, 2017. |
See accompanying notes, which are an integral part of the financial statements.
130
Optimum Large Cap Value Fund Institutional Class
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 15.160 | $ | 16.040 | $ | 15.390 | $ | 12.920 | $ | 11.800 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment income1 |
0.204 | 0.204 | 0.165 | 0.203 | 0.214 | |||||||||||||||
Net realized and unrealized gain (loss) |
2.056 | (0.890 | ) | 0.690 | 2.410 | 1.255 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
2.260 | (0.686 | ) | 0.855 | 2.613 | 1.469 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Net investment income |
(0.216 | ) | (0.194 | ) | (0.205 | ) | (0.143 | ) | (0.349 | ) | ||||||||||
Net realized gain |
(1.744 | ) | | | | | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
(1.960 | ) | (0.194 | ) | (0.205 | ) | (0.143 | ) | (0.349 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 15.460 | $ | 15.160 | $ | 16.040 | $ | 15.390 | $ | 12.920 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return2 |
15.30% | (4.29% | ) | 5.60% | 20.31% | 12.92% | ||||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 1,217,722 | $ | 1,129,606 | $ | 1,146,123 | $ | 1,002,553 | $ | 730,785 | ||||||||||
Ratio of expenses to average net assets |
1.08% | 1.15% | 1.08% | 1.18% | 1.22% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
1.09% | 1.16% | 1.08% | 1.19% | 1.24% | |||||||||||||||
Ratio of net investment income to average net assets |
1.31% | 1.32% | 1.04% | 1.44% | 1.83% | |||||||||||||||
Ratio of net investment income to average net assets prior to fees waived |
1.30% | 1.31% | 1.04% | 1.43% | 1.81% | |||||||||||||||
Portfolio turnover |
82%3 | 39% | 35% | 37% | 49% |
1 | The average shares outstanding method has been applied for per share information. |
2 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value. Total investment return during some of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
3 | As a result of Rothschild Asset Management Inc. replacing Herdon Capital Management, LLC as one of the sub-advisors to Optimum Large Cap Value Fund during the Funds fiscal year ending March 31, 2017, the Funds portfolio turnover rate increased substantially during the year ended March 31, 2017. |
See accompanying notes, which are an integral part of the financial statements.
(continues) | 131 |
Financial highlights
Optimum Small-Mid Cap Growth Fund Class A
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 10.950 | $ | 15.370 | $ | 15.570 | $ | 14.260 | $ | 13.000 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment loss1 |
(0.139 | ) | (0.148 | ) | (0.164 | ) | (0.193 | ) | (0.079 | ) | ||||||||||
Net realized and unrealized gain (loss) |
2.499 | (2.264 | ) | 1.442 | 3.073 | 1.653 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
2.360 | (2.412 | ) | 1.278 | 2.880 | 1.574 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Return of capital |
| | 2 | | | | ||||||||||||||
Net realized gain |
| (2.008 | ) | (1.478 | ) | (1.570 | ) | (0.314 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
| (2.008 | ) | (1.478 | ) | (1.570 | ) | (0.314 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 13.310 | $ | 10.950 | $ | 15.370 | $ | 15.570 | $ | 14.260 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return3 |
21.55% | (16.77% | ) | 8.93% | 21.63% | 12.50% | ||||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 5,293 | $ | 5,040 | $ | 7,050 | $ | 7,158 | $ | 6,415 | ||||||||||
Ratio of expenses to average net assets |
1.58% | 1.66% | 1.63% | 1.76% | 1.86% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
1.79% | 1.85% | 1.77% | 1.96% | 2.05% | |||||||||||||||
Ratio of net investment loss to average net assets |
(1.16% | ) | (1.09% | ) | (1.09% | ) | (1.28% | ) | (0.62% | ) | ||||||||||
Ratio of net investment loss to average net assets prior to fees waived |
(1.37% | ) | (1.28% | ) | (1.23% | ) | (1.48% | ) | (0.81% | ) | ||||||||||
Portfolio turnover |
180%4 | 104% | 72% | 58% | 78% |
1 | The average shares outstanding method has been applied for per share information. |
2 | For the year ended March 31, 2016, return of capital distribution of $108 for Class A calculated to a de minimis amount of $0.000 per share. |
3 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return during all of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
4 | As a result of Peregrine Capital Management, LLC and Columbus Circle Investors replacing Columbia Wanger Asset Management and Wellington Management as the sub-advisors to Optimum Small-Mid Cap Growth Fund during the Funds fiscal year ending March 31, 2017, the Funds portfolio turnover rate increased substantially during the year ended March 31, 2017. |
See accompanying notes, which are an integral part of the financial statements.
132
Optimum Small-Mid Cap Growth Fund Class C
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 9.610 | $ | 13.860 | $ | 14.290 | $ | 13.280 | $ | 12.220 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment loss1 |
(0.200 | ) | (0.223 | ) | (0.252 | ) | (0.274 | ) | (0.151 | ) | ||||||||||
Net realized and unrealized gain (loss) |
2.180 | (2.019 | ) | 1.300 | 2.854 | 1.525 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
1.980 | (2.242 | ) | 1.048 | 2.580 | 1.374 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Return of capital |
| | 2 | | | | ||||||||||||||
Net realized gain |
| (2.008 | ) | (1.478 | ) | (1.570 | ) | (0.314 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
| (2.008 | ) | (1.478 | ) | (1.570 | ) | (0.314 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 11.590 | $ | 9.610 | $ | 13.860 | $ | 14.290 | $ | 13.280 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return3 |
20.60% | (17.39% | ) | 8.08% | 20.82% | 11.73% | ||||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 16,668 | $ | 16,972 | $ | 23,206 | $ | 22,581 | $ | 20,921 | ||||||||||
Ratio of expenses to average net assets |
2.33% | 2.41% | 2.38% | 2.45% | 2.51% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
2.54% | 2.60% | 2.52% | 2.65% | 2.70% | |||||||||||||||
Ratio of net investment loss to average net assets |
(1.91% | ) | (1.84% | ) | (1.84% | ) | (1.97% | ) | (1.27% | ) | ||||||||||
Ratio of net investment loss to average net assets prior to fees waived |
(2.12% | ) | (2.03% | ) | (1.98% | ) | (2.17% | ) | (1.46% | ) | ||||||||||
Portfolio turnover |
180%4 | 104% | 72% | 58% | 78% |
1 | The average shares outstanding method has been applied for per share information. |
2 | For the year ended March 31, 2016, return of capital distribution of $416 for Class C calculated to a de minimis amount of $0.000 per share. |
3 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return during all of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
4 | As a result of Peregrine Capital Management, LLC and Columbus Circle Investors replacing Columbia Wanger Asset Management and Wellington Management as the sub-advisors to Optimum Small-Mid Cap Growth Fund during the Funds fiscal year ending March 31, 2017, the Funds portfolio turnover rate increased substantially during the year ended March 31, 2017. |
See accompanying notes, which are an integral part of the financial statements.
(continues) | 133 |
Financial highlights
Optimum Small-Mid Cap Growth Fund Institutional Class
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 11.650 | $ | 16.170 | $ | 16.270 | $ | 14.780 | $ | 13.420 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment loss1 |
(0.116 | ) | (0.120 | ) | (0.132 | ) | (0.152 | ) | (0.036 | ) | ||||||||||
Net realized and unrealized gain (loss) |
2.656 | (2.392 | ) | 1.510 | 3.212 | 1.710 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
2.540 | (2.512 | ) | 1.378 | 3.060 | 1.674 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Return of capital |
| | 2 | | | | ||||||||||||||
Net realized gain |
| (2.008 | ) | (1.478 | ) | (1.570 | ) | (0.314 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
| (2.008 | ) | (1.478 | ) | (1.570 | ) | (0.314 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 14.190 | $ | 11.650 | $ | 16.170 | $ | 16.270 | $ | 14.780 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return3 |
21.80% | (16.54% | ) | 9.18% | 22.03% | 12.94% | ||||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 420,279 | $ | 440,683 | $ | 527,647 | $ | 436,823 | $ | 321,441 | ||||||||||
Ratio of expenses to average net assets |
1.33% | 1.41% | 1.38% | 1.45% | 1.51% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
1.54% | 1.60% | 1.52% | 1.65% | 1.70% | |||||||||||||||
Ratio of net investment loss to average net assets |
(0.91% | ) | (0.84% | ) | (0.84% | ) | (0.97% | ) | (0.27% | ) | ||||||||||
Ratio of net investment loss to average net assets prior to fees waived |
(1.12% | ) | (1.03% | ) | (0.98% | ) | (1.17% | ) | (0.46% | ) | ||||||||||
Portfolio turnover |
180%4 | 104% | 72% | 58% | 78% |
1 | The average shares outstanding method has been applied for per share information. |
2 | For the year ended March 31, 2016, return of capital distribution of $8,916 for Institutional Class calculated to a de minimis amount of $0.000 per share. |
3 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value. Total investment return during all of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
4 | As a result of Peregrine Capital Management, LLC and Columbus Circle Investors replacing Columbia Wanger Asset Management and Wellington Management as the sub-advisors to Optimum Small-Mid Cap Growth Fund during the Funds fiscal year ending March 31, 2017, the Funds portfolio turnover rate increased substantially during the year ended March 31, 2017. |
See accompanying notes, which are an integral part of the financial statements.
134
Optimum Small-Mid Cap Value Fund Class A
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 11.530 | $ | 13.640 | $ | 14.880 | $ | 13.740 | $ | 12.590 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment income (loss)1 |
0.080 | (0.043 | ) | (0.092 | ) | (0.092 | ) | (0.027 | ) | |||||||||||
Net realized and unrealized gain (loss) |
2.207 | (1.579 | ) | (0.032 | ) | 2.873 | 1.609 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
2.287 | (1.622 | ) | (0.124 | ) | 2.781 | 1.582 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Net investment income |
(0.047 | ) | | | | | ||||||||||||||
Return of capital |
| (0.001 | ) | | | | ||||||||||||||
Net realized gain |
| (0.487 | ) | (1.116 | ) | (1.641 | ) | (0.432 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
(0.047 | ) | (0.488 | ) | (1.116 | ) | (1.641 | ) | (0.432 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 13.770 | $ | 11.530 | $ | 13.640 | $ | 14.880 | $ | 13.740 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return2 |
19.84% | (11.96% | ) | (0.69% | ) | 21.85% | 13.23% | |||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 4,279 | $ | 4,302 | $ | 5,440 | $ | 6,058 | $ | 5,711 | ||||||||||
Ratio of expenses to average net assets |
1.51% | 1.61% | 1.62% | 1.70% | 1.76% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
1.71% | 1.75% | 1.68% | 1.86% | 1.98% | |||||||||||||||
Ratio of net investment income (loss) to average net assets |
0.64% | (0.35% | ) | (0.65% | ) | (0.64% | ) | (0.22% | ) | |||||||||||
Ratio of net investment income (loss) to average net assets prior to fees waived |
0.44% | (0.49% | ) | (0.71% | ) | (0.80% | ) | (0.44% | ) | |||||||||||
Portfolio turnover |
30% | 90%3 | 31% | 33% | 36% |
1 | The average shares outstanding method has been applied for per share information. |
2 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return during all of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
3 | As a result of LSV Asset Management replacing The Delafield Group, a division of Tocqueville Asset Management L.P., and The Killen Group, Inc. as one of the sub-advisors to Optimum Small-Mid Cap Value Fund during the Funds fiscal year ending March 31, 2016, the Funds portfolio turnover rate increased substantially during the year ended March 31, 2016. |
See accompanying notes, which are an integral part of the financial statements.
(continues) | 135 |
Financial highlights
Optimum Small-Mid Cap Value Fund Class C
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 10.270 | $ | 12.300 | $ | 13.630 | $ | 12.800 | $ | 11.830 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment loss1 |
(0.012 | ) | (0.122 | ) | (0.179 | ) | (0.175 | ) | (0.100 | ) | ||||||||||
Net realized and unrealized gain (loss) |
1.952 | (1.420 | ) | (0.035 | ) | 2.646 | 1.502 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
1.940 | (1.542 | ) | (0.214 | ) | 2.471 | 1.402 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Return of capital |
| (0.001 | ) | | | | ||||||||||||||
Net realized gain |
| (0.487 | ) | (1.116 | ) | (1.641 | ) | (0.432 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
| (0.488 | ) | (1.116 | ) | (1.641 | ) | (0.432 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 12.210 | $ | 10.270 | $ | 12.300 | $ | 13.630 | $ | 12.800 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return2 |
18.89% | (12.62% | ) | (1.45% | ) | 21.08% | 12.45% | |||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 14,268 | $ | 15,136 | $ | 19,245 | $ | 20,846 | $ | 20,058 | ||||||||||
Ratio of expenses to average net assets |
2.26% | 2.36% | 2.37% | 2.40% | 2.41% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
2.46% | 2.50% | 2.43% | 2.56% | 2.63% | |||||||||||||||
Ratio of net investment loss to average net assets |
(0.11% | ) | (1.10% | ) | (1.40% | ) | (1.34% | ) | (0.87% | ) | ||||||||||
Ratio of net investment loss to average net assets prior to fees waived |
(0.31% | ) | (1.24% | ) | (1.46% | ) | (1.50% | ) | (1.09% | ) | ||||||||||
Portfolio turnover |
30% | 90%3 | 31% | 33% | 36% |
1 | The average shares outstanding method has been applied for per share information. |
2 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return during all of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
3 | As a result of LSV Asset Management replacing The Delafield Group, a division of Tocqueville Asset Management L.P., and The Killen Group, Inc. as one of the sub-advisors to Optimum Small-Mid Cap Value Fund during the Funds fiscal year ending March 31, 2016, the Funds portfolio turnover rate increased substantially during the year ended March 31, 2016. |
See accompanying notes, which are an integral part of the financial statements.
136
Optimum Small-Mid Cap Value Fund Institutional Class
Selected data for each share of the Fund outstanding throughout each period were as follows:
Year ended | ||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/15 | 3/31/14 | 3/31/13 | ||||||||||||||||
Net asset value, beginning of period |
$ | 12.160 | $ | 14.310 | $ | 15.530 | $ | 14.230 | $ | 12.990 | ||||||||||
Income (loss) from investment operations: |
||||||||||||||||||||
Net investment income (loss)1 |
0.117 | (0.013 | ) | (0.059 | ) | (0.050 | ) | 0.016 | ||||||||||||
Net realized and unrealized gain (loss) |
2.320 | (1.649 | ) | (0.045 | ) | 2.995 | 1.661 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total from investment operations |
2.437 | (1.662 | ) | (0.104 | ) | 2.945 | 1.677 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Less dividends and distributions from: |
||||||||||||||||||||
Net investment income |
(0.077 | ) | | | (0.004 | ) | (0.005 | ) | ||||||||||||
Return of capital |
| (0.001 | ) | | | | ||||||||||||||
Net realized gain |
| (0.487 | ) | (1.116 | ) | (1.641 | ) | (0.432 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total dividends and distributions |
(0.077 | ) | (0.488 | ) | (1.116 | ) | (1.645 | ) | (0.437 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net asset value, end of period |
$ | 14.520 | $ | 12.160 | $ | 14.310 | $ | 15.530 | $ | 14.230 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total return2 |
20.05% | (11.67% | ) | (0.53% | ) | 22.29% | 13.56% | |||||||||||||
Ratios and supplemental data: |
||||||||||||||||||||
Net assets, end of period (000 omitted) |
$ | 406,327 | $ | 441,150 | $ | 499,578 | $ | 439,417 | $ | 318,758 | ||||||||||
Ratio of expenses to average net assets |
1.26% | 1.36% | 1.37% | 1.40% | 1.41% | |||||||||||||||
Ratio of expenses to average net assets prior to fees waived |
1.46% | 1.50% | 1.43% | 1.56% | 1.63% | |||||||||||||||
Ratio of net investment income (loss) to average net assets |
0.89% | (0.10% | ) | (0.40% | ) | (0.34% | ) | 0.13% | ||||||||||||
Ratio of net investment income (loss) to average net assets prior to fees waived |
0.69% | (0.24% | ) | (0.46% | ) | (0.50% | ) | (0.09% | ) | |||||||||||
Portfolio turnover |
30% | 90%3 | 31% | 33% | 36% |
1 | The average shares outstanding method has been applied for per share information. |
2 | Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value. Total investment return during all of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect. |
3 | As a result of LSV Asset Management replacing The Delafield Group, a division of Tocqueville Asset Management L.P., and The Killen Group, Inc. as one of the sub-advisors to Optimum Small-Mid Cap Value Fund during the Funds fiscal year ending March 31, 2016, the Funds portfolio turnover rate increased substantially during the year ended March 31, 2016. |
See accompanying notes, which are an integral part of the financial statements.
(continues) | 137 |
Optimum Fund Trust
March 31, 2017
Optimum Fund Trust (Trust) is organized as a Delaware statutory trust and offers six series: Optimum Fixed Income Fund, Optimum International Fund, Optimum Large Cap Growth Fund, Optimum Large Cap Value Fund, Optimum Small-Mid Cap Growth Fund, and Optimum Small-Mid Cap Value Fund, (each, a Fund, or collectively, the Funds). The Trust is an open-end investment company. The Funds are considered diversified under the Investment Company Act of 1940 (1940 Act), as amended, and offer Class A, Class C, and Institutional Class shares. Class A shares are sold with a maximum front-end sales charge of 4.50% for Optimum Fixed Income Fund and 5.75% for Optimum International Fund, Optimum Large Cap Growth Fund, Optimum Large Cap Value Fund, Optimum Small-Mid Cap Growth Fund, and Optimum Small-Mid Cap Value Fund. Class A share purchases of $1,000,000 or more will incur a contingent deferred sales charge (CDSC) instead of front-end sales charge of 1.00% if redeemed during the first year and 0.50% during the second year, provided that Delaware Distributors, L.P. (DDLP) paid a financial advisor a commission on the purchase of those shares. Class C shares are sold with a CDSC of 1.00%, if redeemed during the first 12 months. Institutional Class shares are not subject to a sales charge and are offered for sale exclusively to certain eligible investors.
The investment objective of Optimum Fixed Income Fund is to seek a high level of income. The Fund may also seek growth of capital.
The investment objective of Optimum International Fund is to seek long-term growth of capital. The Fund may also seek income.
The investment objective of Optimum Large Cap Growth Fund is to seek long-term growth of capital.
The investment objective of Optimum Large Cap Value Fund is to seek long-term growth of capital. The Fund may also seek income.
The investment objective of Optimum Small-Mid Cap Growth Fund is to seek long-term growth of capital.
The investment objective of Optimum Small-Mid Cap Value Fund is to seek long-term growth of capital.
1. Significant Accounting Policies
The following accounting policies are in accordance with U.S. generally accepted accounting principles (U.S. GAAP) and are consistently followed by the Funds.
Security Valuation Equity securities and exchange-traded funds (ETFs), except those traded on the Nasdaq Stock Market LLC (Nasdaq), are valued at the last quoted sales price as of the time of the regular close of the New York Stock Exchange on the valuation date. Equity securities and ETFs traded on the Nasdaq are valued in accordance with the Nasdaq Official Closing Price, which may not be the last sales price. If, on a particular day, an equity security or ETF does not trade, the mean between the bid and ask prices will be used, which approximates fair value. Equity securities listed on a foreign exchange are normally valued at the last quoted sales price on the valuation date. Open-end investment company securities are valued at net asset value (NAV) per share, as reported by the underlying investment company. U.S. government and agency securities are valued at the mean between the bid and ask prices, which approximates fair value. Other debt securities, credit default swap (CDS) contracts, interest rate swap options contracts (swaptions) and interest rate swap contracts are valued based upon valuations provided by an independent pricing service or broker/counterparty and reviewed by management. To the extent current market prices are not available, the pricing service may take into account developments related to the specific security, as well as transactions in comparable securities. Valuations for fixed income securities utilize matrix systems, which reflect such factors as security prices, yields, maturities, and ratings, and are supplemented by dealer and exchange quotations. For asset-backed securities, collateralized mortgage obligations, commercial mortgage securities, and U.S. government agency mortgage securities, pricing vendors utilize matrix pricing which considers prepayment speed, attributes of the collateral, yield or price of bonds of comparable quality, coupon, maturity, and type as well as broker/dealer-supplied prices. Swap prices are derived using daily swap curves and models that incorporate a number of market data factors, such as discounted cash flows, trades, and values of the underlying reference instruments. Foreign currency exchange contracts and foreign cross currency exchange contracts are valued at the mean between the bid and the ask prices, which approximates fair value. Interpolated values are derived when the settlement date of the contract is an interim date for which quotations are not available. Futures contracts and options on futures contracts are valued at the daily quoted settlement prices. Exchange-traded options are valued at the last reported sale price or, if no sales are reported, at the mean between the last reported bid and ask prices, which approximates fair value. Generally, other securities and assets for which market quotations are not readily available are valued at fair value as determined in good faith under the direction of the Trusts Board of Trustees (Board). In determining whether market quotations are readily available or fair valuation will be used, various factors will be taken into consideration, such as market closures or suspension of trading in a security. Each Fund may use fair value pricing more frequently for securities traded primarily in non-U.S. markets because, among other things, most foreign markets close well before each Fund values its securities, generally as of 4:00 p.m. Eastern time. The earlier close of these foreign markets gives rise to the possibility that significant events, including broad market moves,
138 |
government actions or pronouncements, aftermarket trading, or news events may have occurred in the interim. Whenever such a significant event occurs, each Fund may value foreign securities using fair value prices based on third-party vendor modeling tools (international fair value pricing).
Federal and Foreign Income Taxes No provision for federal income taxes has been made as each Fund intends to continue to qualify for federal income tax purposes as a regulated investment company (RIC) under Subchapter M of the Internal Revenue Code of 1986, as amended, and make the requisite distributions to shareholders. The Funds evaluate tax positions taken or expected to be taken in the course of preparing each Funds tax returns to determine whether the tax positions are more-likely-than-not of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold are recorded as a tax benefit or expense in the current year. Management has analyzed each Funds tax positions taken for all open federal income tax years (March 31, 2014March 31, 2017) and has concluded that no provision for federal income tax is required in any Funds financial statements. In regard to foreign taxes only, each Fund has open tax years in certain foreign countries in which it invests that may date back to the inception of each Fund.
Class Accounting Investment income, common expenses, and realized and unrealized gain (loss) on investments are allocated to the various classes of the Funds on the basis of daily net assets of each class. Distribution expenses relating to a specific class are charged directly to that class.
Repurchase Agreements Each Fund may purchase certain U.S. government securities subject to the counterpartys agreement to repurchase them at an agreed upon date and price. The counterparty will be required on a daily basis to maintain the value of the collateral subject to the agreement at not less than the repurchase price (including accrued interest). The agreements are conditioned upon the collateral being deposited under the Federal Reserve book-entry system with each Funds custodian or a third-party sub-custodian. In the event of default or bankruptcy by the other party to the agreement, retention of the collateral may be subject to legal proceedings. All open repurchase agreements as of the date of this report were entered into on March 31, 2017, and matured on the next business day.
Reverse Repurchase Agreements Optimum Fixed Income Fund may enter into reverse repurchase agreements. In a reverse repurchase agreement, the Fund sells securities to a bank or broker/dealer and agrees to repurchase the securities at an agreed upon date and price. The Fund will maintain in a segregated account, cash, cash equivalents, or U.S. government securities in an amount sufficient to cover its obligations under reverse repurchase agreements with broker/dealers (but no collateral is required on reverse repurchase agreements with banks). The Fund will subject its investments in reverse repurchase agreements to the borrowing provisions set forth in the 1940 Act. The use of reverse repurchase agreements by the Fund creates leverage, which increases the Funds investment risk. If the income and gains on securities purchased with the proceeds of reverse repurchase agreements exceed the costs of the agreements, the Funds earnings or NAV will increase faster than otherwise would be the case; conversely, if the income and gains fail to exceed the costs, earnings or NAV would decline faster than otherwise would be the case. For the year ended March 31, 2017, the Fund had average reverse repurchase agreements of $468,942, for which it paid interest at an average rate of 1.18%. At March 31, 2017, the Fund posted $2,395,358 in securities collateral for reverse repurchase agreements, which comprised of U.S. treasury obligations.
To Be Announced Trades (TBA) Optimum Fixed Income Fund may contract to purchase or sell securities for a fixed price at a transaction date beyond the customary settlement period (examples: when issued, delayed delivery, forward commitment, or TBA transactions) consistent with the Funds ability to manage its investment portfolio and meet redemption requests. These transactions involve a commitment by the Fund to purchase or sell securities for a predetermined price or yield with payment and delivery taking place more than three days in the future, or after a period longer than the customary settlement period for that type of security. No interest will be earned by the Fund on such purchases until the securities are delivered or the transaction is completed; however, the market value may change prior to delivery. Optimum Fixed Income Fund received $2,172,000 cash collateral for TBA trades as of March 31, 2017, which is shown as Cash collateral due to brokers on the Statements of assets and liabilities. The Fund also received $721,800 in securities collateral for TBA trades comprised of U.S. treasury obligations.
Foreign Currency Transactions Transactions denominated in foreign currencies are recorded at the prevailing exchange rates on the valuation date in accordance with the Funds prospectus. The value of all assets and liabilities denominated in foreign currencies is translated daily into U.S. dollars at the exchange rate of such currencies against the U.S. dollar. Transaction gains or losses resulting from changes in exchange rates during the reporting period or upon settlement of the foreign currency transaction are reported in operations for the current period. The Funds generally bifurcate that portion of realized gains and losses on investments in debt securities which is due to changes in foreign exchange rates from that which is due to changes in market prices of debt securities. That portion of gains (losses), which is due to changes in foreign exchange rates is included on the Statements of operations under Net realized gain (loss) on foreign currencies. For
(continues) | 139 |
Notes to financial statements
Optimum Fund Trust
1. Significant Accounting Policies (continued)
foreign equity securities, the realized gains and losses are included on the Statements of operations under Net realized and unrealized gain (loss) on investments. The Funds report certain foreign currency related transactions as components of realized gains (losses) for financial reporting purposes, whereas such components are treated as ordinary income (loss) for federal income tax purposes.
Use of Estimates Each Fund is an investment company, whose financial statements are prepared in conformity with U.S. GAAP. Therefore, each Fund follows the accounting and reporting guidelines for investment companies. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the fair value of investments, the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and the differences could be material.
Other Expenses directly attributable to a Fund are charged directly to that Fund. Other expenses common to various funds within the Trust are generally allocated among such funds on the basis of average net assets. Management fees and certain other expenses are paid monthly. Security transactions are recorded on the date the securities are purchased or sold (trade date) for financial reporting purposes. Costs used in calculating realized gains and losses on the sale of investment securities are those of the specific securities sold. Dividend income is recorded on the ex-dividend date and interest income is recorded on the accrual basis. Discounts and premiums on debt securities are accreted or amortized to interest income, respectively, over the lives of the respective securities using the effective interest method. Realized gains (losses) on paydowns of asset- and mortgage-backed securities are classified as interest income. Distributions received from investments in real estate investment trusts (REITs) are recorded as dividend income on the ex-dividend date, subject to reclassification upon notice of the character of such distributions by the issuer. Distributions received from investments in master limited partnerships are recorded as return of capital on investments on the ex-dividend date. Foreign dividends are also recorded on the ex-dividend date or as soon after the ex-dividend date that the Funds are aware of such dividends, net of all tax withholdings, a portion of which may be reclaimable. Withholding taxes and reclaims on foreign dividends and interest have been recorded in accordance with the Funds understanding of the applicable countrys tax rules and rates. Each Fund may pay foreign capital gains taxes on certain foreign securities held, which are reported as components of realized losses for financial reporting purposes, whereas such components are treated as ordinary loss for federal income tax purposes. Each Fund declares and pays distributions from net investment income and net realized gain on investments, if any, at least annually. The Funds may distribute more frequently, if necessary for tax purposes. Dividends and distributions, if any, are recorded on the ex-dividend date.
Each Fund may receive earnings credits from its custodian when positive cash balances are maintained, which may be used to offset custody fees. There were no such earnings credits for the year ended March 31, 2017.
Each Fund receives earnings credits from its transfer agent when positive cash balances are maintained, which may be used to offset transfer agent fees. If the amount earned is greater than $1.00 dollar, the expense paid under this arrangement is included on the Statements of operations under Dividend disbursing and transfer agent fees and expenses with the corresponding expense offset shown under Less expense paid indirectly. For the year ended March 31, 2017, each Fund earned the following amounts under this agreement:
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund | |||||||
$843 | $823 | $927 | $929 | $906 | $913 |
2. Investment Management, Administration Agreements, and Other Transactions with Affiliates
Delaware Management Company (DMC), a series of Delaware Management Business Trust, furnishes investment management services to each Fund and has full discretion and responsibility, subject to the overall supervision of the Board, to select and contract with one or more investment sub-advisors to manage the investment operations and composition of each Fund, and to render investment advice for each Fund, including the purchase, retention, and dispositions of investments, securities, and cash contained in each Fund. The investment management agreement obligates DMC to implement decisions with respect to the allocation or reallocation of each Funds assets among one or more current or additional sub-advisors, and to monitor the sub-advisors compliance with the relevant Funds investment objective, policies and restrictions. DMC pays the sub-advisors out of its fees.
140
In accordance with the terms of its respective investment management agreement, DMC is entitled to receive an annual fee equal to the following percentage rates of the average daily net assets of each Fund:
Optimum Fixed Income Fund |
0.7000% of net assets up to $25 million | |
0.6500% of net assets from $25 million to $100 million | ||
0.6000% of net assets from $100 million to $500 million | ||
0.5500% of net assets from $500 million to $1 billion | ||
0.5000% of net assets from $1 billion to $2.5 billion | ||
0.4750% of net assets over $2.5 billion | ||
Optimum International Fund |
0.8750% of net assets up to $50 million | |
0.8000% of net assets from $50 million to $100 million | ||
0.7800% of net assets from $100 million to $300 million | ||
0.7650% of net assets from $300 million to $400 million | ||
0.7300% of net assets over $400 million | ||
Optimum Large Cap Growth Fund |
0.8000% of net assets up to $250 million | |
0.7875% of net assets from $250 million to $300 million | ||
0.7625% of net assets from $300 million to $400 million | ||
0.7375% of net assets from $400 million to $500 million | ||
0.7250% of net assets from $500 million to $1 billion | ||
0.7100% of net assets from $1 billion to $1.5 billion | ||
0.7000% of net assets over $1.5 billion | ||
Optimum Large Cap Value Fund |
0.8000% of net assets up to $100 million | |
0.7375% of net assets from $100 million to $250 million | ||
0.7125% of net assets from $250 million to $500 million | ||
0.6875% of net assets from $500 million to $1 billion | ||
0.6675% of net assets from $1 billion to $1.5 billion | ||
0.6475% of net assets over $1.5 billion | ||
Optimum Small-Mid Cap Growth Fund |
1.1000% of net assets | |
Optimum Small-Mid Cap Value Fund |
1.0500% of net assets up to $75 million | |
1.0250% of net assets from $75 million to $150 million | ||
1.0000% of net assets over $150 million |
DMC has entered into sub-advisory agreements for the Trust as follows: Optimum Fixed Income Fund Pacific Investment Management Company, LLC (PIMCO); Optimum International Fund Acadian Asset Management LLC (Acadian), and EARNEST Partners, LLC (EARNEST); Optimum Large Cap Growth Fund T. Rowe Price Associates, Inc. (T. Rowe Price), and Fred Alger Management, Inc. (Alger); Optimum Large Cap Value Fund Massachusetts Financial Services Company (MFS) and Rothschild Asset Management Inc. (Rothschild); Optimum Small-Mid Cap Growth Fund Columbus Circle Investors (CCI) and Peregrine Capital Management LLC (Peregrine); Optimum Small-Mid Cap Value Fund LSV Asset Management (LSV) and Westwood Management Corp. (Westwood). Prior to Oct. 3, 2016, Herdon Capital Management, LLC (Herdon) was also a sub-advisor for Optimum Large Cap Value Fund.
For the year ended March 31, 2017, DMC paid the following sub-advisory fees:
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund | |||||||
$2,448,536 | $2,242,737 | $5,289,578 | $4,076,492 | $1,990,338 | $2,195,301 |
(continues) | 141 |
Notes to financial statements
Optimum Fund Trust
2. Investment Management, Administration Agreements, and Other Transactions with Affiliates (continued)
DMC has contractually agreed to waive that portion, if any, of its management fee and/or pay/reimburse each Fund to the extent necessary to ensure that total annual fund operating expenses (excluding any distribution and service (12b-1) fees, acquired fund fees and expenses, taxes, interest, short sale and dividend interest expenses, brokerage fees, certain insurance costs, and nonroutine expenses or costs, including, but not limited to, those relating to reorganizations, litigation, conducting shareholder meetings, and liquidations (collectively, nonroutine expenses)) do not exceed the following percentages of each Funds average daily net assets. For purposes of these waivers and reimbursements, nonroutine expenses may also include such additional costs and expenses as may be agreed upon from time to time by the Board and DMC. These waivers and reimbursements may be terminated only by agreement of DMC and the Funds.
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund | |||||||
Operating expense limitation as a percentage of average daily net assets (per annum) for the
period |
0.92% | 1.25% | 1.10% | 1.08% | 1.33% | 1.25% | ||||||
Operating expense limitation as a percentage of average daily net assets (per annum) for the
period |
0.92% | 1.25% | 1.09% | 1.08% | 1.34% | 1.27% |
Delaware Investments Fund Services Company (DIFSC), an affiliate of DMC, provides fund accounting and financial administration oversight services to the Trust. Those services include overseeing the Funds pricing process, the calculation and payment of fund expenses, and financial reporting in shareholder reports, registration statements and other regulatory filings. DIFSC also manages the process for the payment of dividends and distributions and the dissemination of Funds NAVs and performance data. For these services, the Funds pay DIFSC an asset-based fee, plus certain out-of-pocket expenses and transactional charges. DIFSC fees are calculated based on the aggregate daily net assets of the Trust at the following annual rate: 0.0075% of the first $3 billion; 0.0070% of the next $2 billion; 0.0065% of the next $2.5 billion; 0.0055% of the next $2.5 billion; and 0.0050% of aggregate average daily net assets in excess of $10 billion. The fees payable to DIFSC under the service agreement described above are allocated among all funds in the Trust on a relative NAV basis. These amounts are included on the Statements of operations under Accounting fees. For the year ended March 31, 2017, each Fund was charged for these services as follows:
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund | |||||||
$143,713 | $40,815 | $105,317 | $97,546 | $30,719 | $30,197 |
DIFSC provides the Trust with administrative services including: preparation, filing and maintaining governing documents; preparation of materials and reports for the Board; and preparation and filing of registration statements and other regulatory filings. For these administrative services, each Fund pays DIFSC a fee at an annual rate (plus out-of-pocket expenses) of 0.120% of assets up to $500 million of the Funds average daily net assets; 0.095% of assets from $500 million to $1 billion; and 0.070% of assets over $1 billion.
DIFSC is also the shareholder servicing, dividend disbursing, and transfer agent for each Fund. For these services, the Trust pays DIFSC a fee at an annual rate of 0.200% of the Trusts total average daily net assets, subject to certain minimums, plus out-of-pocket expenses. Pursuant to a sub-transfer agency agreement between DIFSC and BNY Mellon Investment Servicing (US) Inc. (BNYMIS), BNYMIS provides certain sub-transfer agency services to the Funds. Sub-transfer agency fees are paid by the Funds and are also included on the Statements of operations under Dividend disbursing and transfer agent fees and expenses.
142
DDLP, an affiliate of DMC, serves as the national distributor of each Funds shares pursuant to a Distribution Agreement. Pursuant to the Distribution Agreement and Rule 12b-1 plan, each Fund pays DDLP an annual 12b-1 fee of 0.25% of the average daily net assets of the Class A shares and 1.00% of the average daily net assets of the Class C shares. Institutional Class shares pay no 12b-1 fees.
For the year ended March 31, 2017, DDLP earned commissions on sales of Class A shares for each Fund as follows:
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund | |||||||
$33,326 | $2,814 | $8,546 | $8,474 | $2,592 | $2,249 |
For the year ended March 31, 2017, DDLP received gross CDSC commissions on redemptions of each Funds Class C shares, and these commissions were entirely used to offset upfront commissions previously paid by DDLP to broker/dealers on sales of those shares. The amounts received were as follows:
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund | |||||||
$15,380 | $3,194 | $9,337 | $9,535 | $1,648 | $1,126 |
DMC, DIFSC and DDLP are indirect, wholly owned subsidiaries of Delaware Management Holdings, Inc. Certain officers of DMC, DIFSC and DDLP are officers and/or Trustees of the Trust. These officers and Trustees are paid no compensation by the Funds.
Cross trades for the year ended March 31, 2017, were executed by the Funds pursuant to procedures adopted by the Board designed to ensure compliance with Rule 17a-7 under the 1940 Act. Cross trading is the buying or selling of portfolio securities between funds of investment companies, or between a fund of an investment company and another entity, that are or could be considered affiliates by virtue of having a common investment advisor (or affiliated investment advisors), common directors/trustees and/or common officers. At its regularly scheduled meetings, the Board reviews such transactions for compliance with the procedures adopted by the Board. Optimum Large Cap Growth Fund did not engage in securities cross trades for the year ended March 31, 2017. Pursuant to these procedures, for the year ended March 31, 2017, the Funds engaged in securities purchases and securities sales, which resulted in net realized gain as follows.
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund |
||||||||||||||||
Purchases |
$ | 12,806,169 | $ | | $ | | $ | | $ | | ||||||||||
Sales |
44,576,914 | 1,778,377 | 71,090,160 | 4,474,431 | 5,673,779 | |||||||||||||||
Net realized gain |
933 | 16 | 24,065 | 1,419 | 265 |
3. Investments
For the year ended March 31, 2017, each Fund made purchases and sales of investments securities other than short-term investments as follows:
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund |
|||||||||||||||||||
Purchases other than U.S. government securities |
$ | 6,086,188,597 | $ | 385,091,868 | $ | 745,296,820 | $ | 1,098,280,410 | $ | 755,522,036 | $ | 127,856,370 | ||||||||||||
Purchases of U.S. government securities |
3,368,627,459 | | | | | | ||||||||||||||||||
Sales other than U.S. government securities |
6,143,886,167 | 467,209,617 | 998,796,633 | 1,192,222,897 | 855,576,347 | 229,962,121 | ||||||||||||||||||
Sales of U.S. government securities |
3,609,807,688 | | | | | |
(continues) | 143 |
Notes to financial statements
Optimum Fund Trust
3. Investments (continued)
At March 31, 2017, the cost and unrealized appreciation (depreciation) of investments for federal income tax purposes for each Fund were as follows:
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund |
|||||||||||||||||||
Cost of investments |
$ | 2,177,677,148 | $ | 544,690,259 | $ | 1,185,781,576 | $ | 1,145,298,394 | $ | 372,621,111 | $ | 341,104,621 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Aggregate unrealized appreciation of investments |
$ | 29,762,821 | $ | 82,525,590 | $ | 313,057,883 | $ | 217,943,288 | $ | 83,694,407 | $ | 86,516,989 | ||||||||||||
Aggregate unrealized depreciation of investments |
(35,425,600 | ) | (47,095,776 | ) | (23,468,551 | ) | (24,071,423 | ) | (11,038,037 | ) | (6,789,663 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net unrealized appreciation (depreciation) of investments |
$ | (5,662,779 | ) | $ | 35,429,814 | $ | 289,589,332 | $ | 193,871,865 | $ | 72,656,370 | $ | 79,727,326 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
U.S. GAAP defines fair value as the price that each Fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. A three-level hierarchy for fair value measurements has been established based upon the transparency of inputs to the valuation of an asset or liability. Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the reporting entitys own assumptions about the assumptions that market participants would use in pricing the asset or liability based on the best information available under the circumstances. Each Funds investment in its entirety is assigned a level based upon the observability of the inputs which are significant to the overall valuation. The three-level hierarchy of inputs is summarized below.
Level 1 | | Inputs are quoted prices in active markets for identical investments. (Examples: equity securities, open-end investment companies, futures contracts, exchange-traded options contracts) | ||
Level 2 | | Other observable inputs, including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks, and default rates) or other market-corroborated inputs. (Examples: debt securities, government securities, swap contracts, foreign currency exchange contracts, foreign securities utilizing international fair value pricing, broker-quoted securities, fair valued securities) | ||
Level 3 | | Significant unobservable inputs, including each Funds own assumptions used to determine the fair value of investments. (Examples: broker-quoted securities, fair valued securities) |
Level 3 investments are valued using significant unobservable inputs. Each Fund may also use an income-based valuation approach in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Valuations may also be based upon current market prices of securities that are comparable in coupon, rating, maturity, and industry. The derived value of a Level 3 investment may not represent the value which is received upon disposition and this could impact the results of operations.
144
The following tables summarize the valuation of each Funds investments by fair value hierarchy levels as of March 31, 2017:
Optimum Fixed Income Fund | ||||||||||||||||||||||||||||||
Securities |
Level 1 |
Level 2 |
Level 3 |
Total | ||||||||||||||||||||||||||
Assets: |
||||||||||||||||||||||||||||||
Agency, Asset- & Mortgage-Backed Securities1 |
$ | | $ | 726,322,247 | $ | 281,348 | $ | 726,603,595 | ||||||||||||||||||||||
Corporate Debt |
| 881,103,675 | | 881,103,675 | ||||||||||||||||||||||||||
Foreign Debt |
| 89,273,525 | | 89,273,525 | ||||||||||||||||||||||||||
Municipal Bonds |
| 19,248,506 | | 19,248,506 | ||||||||||||||||||||||||||
Loan Agreements1 |
| 124,238,400 | 4,332,705 | 128,571,105 | ||||||||||||||||||||||||||
Common Stock |
| | | | ||||||||||||||||||||||||||
Convertible Preferred Stock1 |
103,434 | 3,397,720 | | 3,501,154 | ||||||||||||||||||||||||||
Preferred Stock |
| 5,196,176 | | 5,196,176 | ||||||||||||||||||||||||||
U.S. Treasury Obligations |
| 144,306,164 | | 144,306,164 | ||||||||||||||||||||||||||
Short-Term Investments |
| 173,718,136 | | 173,718,136 | ||||||||||||||||||||||||||
Options Purchased |
| 492,333 | | 492,333 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Total Value of Securities |
$ | 103,434 | $ | 2,167,296,882 | $ | 4,614,053 | $ | 2,172,014,369 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Liabilities: |
||||||||||||||||||||||||||||||
Reverse Repurchase Agreements |
$ | | $ | (2,400,000 | ) | $ | | $ | (2,400,000 | ) | ||||||||||||||||||||
Derivatives: |
||||||||||||||||||||||||||||||
Foreign Currency Exchange Contracts |
$ | | $ | 265,679 | $ | | $ | 265,679 | ||||||||||||||||||||||
Futures Contracts |
2,529,328 | | | 2,529,328 | ||||||||||||||||||||||||||
Swap Contracts |
| 2,557,201 | | 2,557,201 | ||||||||||||||||||||||||||
Options Written1 |
(255,938 | ) | (445,447 | ) | | (701,385 | ) |
1Security type is valued across multiple levels. Level 1 investments represent exchange-traded investments, Level 2 investments represent investments with observable inputs or matrix-priced investments, and Level 3 investments represent investments without observable inputs. The amounts attributed to Level 1 investments, Level 2 investments, and Level 3 investments represent the following percentages of the total market value of these security types:
Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||
Agency, Asset & Mortgage-Backed Securities |
| 99.96 | % | 0.04 | % | 100.00 | % | |||||||||||||||||||||
Convertible Preferred Stock |
2.95 | % | 97.05 | % | | 100.00 | % | |||||||||||||||||||||
Loan Agreements |
| 96.63 | % | 3.37 | % | 100.00 | % | |||||||||||||||||||||
Options Written |
36.49 | % | 63.51 | % | | 100.00 | % |
(continues) | 145 |
Notes to financial statements
Optimum Fund Trust
3. Investments (continued)
Optimum International Fund |
||||||||||||||||||||
Securities |
Level 1 |
Level 2 |
Level 3 |
Total | ||||||||||||||||
Assets: |
||||||||||||||||||||
Common Stock |
||||||||||||||||||||
Australia |
$ | 10,487,186 | $ | | $ | | $ | 10,487,186 | ||||||||||||
Austria |
15,394,027 | | | 15,394,027 | ||||||||||||||||
Bermuda |
5,818,128 | | | 5,818,128 | ||||||||||||||||
Brazil |
7,473,819 | | | 7,473,819 | ||||||||||||||||
Canada |
21,390,901 | | | 21,390,901 | ||||||||||||||||
China/Hong Kong |
36,863,661 | | | 36,863,661 | ||||||||||||||||
Colombia |
3,348,761 | | | 3,348,761 | ||||||||||||||||
Czech Republic |
2,333,973 | | | 2,333,973 | ||||||||||||||||
Denmark |
8,380,606 | | | 8,380,606 | ||||||||||||||||
Finland |
1,806,426 | | | 1,806,426 | ||||||||||||||||
France |
21,873,189 | | | 21,873,189 | ||||||||||||||||
Germany |
19,054,767 | | | 19,054,767 | ||||||||||||||||
India |
21,469,356 | | | 21,469,356 | ||||||||||||||||
Indonesia |
15,333,660 | | | 15,333,660 | ||||||||||||||||
Ireland |
11,655,542 | | | 11,655,542 | ||||||||||||||||
Israel |
18,808,405 | | | 18,808,405 | ||||||||||||||||
Italy |
10,395,474 | | | 10,395,474 | ||||||||||||||||
Japan |
97,933,552 | | | 97,933,552 | ||||||||||||||||
Mexico |
4,372,959 | | | 4,372,959 | ||||||||||||||||
Netherlands |
22,568,738 | | | 22,568,738 | ||||||||||||||||
New Zealand |
4,708,018 | | | 4,708,018 | ||||||||||||||||
Norway |
14,600,123 | | | 14,600,123 | ||||||||||||||||
Republic of Korea |
21,006,782 | | | 21,006,782 | ||||||||||||||||
Singapore |
6,426,815 | | | 6,426,815 | ||||||||||||||||
South Africa |
915,430 | | | 915,430 | ||||||||||||||||
Spain |
11,541,620 | | | 11,541,620 | ||||||||||||||||
Sweden |
3,702,437 | | | 3,702,437 | ||||||||||||||||
Switzerland |
37,173,426 | | | 37,173,426 | ||||||||||||||||
Taiwan |
14,431,559 | | | 14,431,559 | ||||||||||||||||
Thailand |
3,087,865 | | | 3,087,865 | ||||||||||||||||
Turkey |
3,675,519 | | | 3,675,519 | ||||||||||||||||
United Kingdom |
63,422,417 | | | 63,422,417 | ||||||||||||||||
United States |
13,708,403 | | 843,154 | 14,551,557 | ||||||||||||||||
Short-Term Investments |
| 5,021,664 | | 5,021,664 | ||||||||||||||||
Securities Lending Collateral |
| 19,091,711 | | 19,091,711 | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||
Total Value of Securities |
$ | 555,163,544 | $ | 24,113,375 | $ | 843,154 | $ | 580,120,073 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||
Derivatives: |
||||||||||||||||||||
Foreign Currency Exchange Contract |
$ | | $ | (530 | ) | $ | | $ | (530 | ) |
146
Optimum Large Cap Growth Fund | ||||||||||||||||||||||
Securities |
Level 1 |
Level 2 |
Level 3 |
Total |
||||||||||||||||||
Assets: |
||||||||||||||||||||||
Common Stock |
||||||||||||||||||||||
Consumer Discretionary |
$ | 325,892,711 | $ | | $ | 1,755,878 | $ | 327,648,589 | ||||||||||||||
Consumer Staples |
50,877,902 | | | 50,877,902 | ||||||||||||||||||
Energy |
15,130,699 | | | 15,130,699 | ||||||||||||||||||
Financials |
69,551,073 | | 121,720 | 69,672,793 | ||||||||||||||||||
Healthcare |
220,676,758 | | | 220,676,758 | ||||||||||||||||||
Industrials |
92,581,167 | | | 92,581,167 | ||||||||||||||||||
Information Technology |
589,730,786 | 2,070,469 | | 591,801,255 | ||||||||||||||||||
Materials |
15,977,954 | | | 15,977,954 | ||||||||||||||||||
Real Estate |
33,822,326 | | | 33,822,326 | ||||||||||||||||||
Telecommunication Services |
13,749,717 | | | 13,749,717 | ||||||||||||||||||
Utilities |
6,123,249 | | | 6,123,249 | ||||||||||||||||||
Convertible Preferred Stock |
| | 8,471,851 | 8,471,851 | ||||||||||||||||||
U.S. Master Limited Partnerships |
6,988,648 | | | 6,988,648 | ||||||||||||||||||
Short-Term Investments |
| 21,848,000 | | 21,848,000 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||
Total Value of Securities |
$ | 1,441,102,990 | $ | 23,918,469 | $ | 10,349,449 | $ | 1,475,370,908 | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||
Optimum Large Cap Value Fund |
||||||||||||||||||||||
Securities |
Level 1 |
Level 2 |
Total |
|||||||||||||||||||
Assets: |
||||||||||||||||||||||
Common Stock |
$ | 1,321,818,724 | $ | | $ | 1,321,818,724 | ||||||||||||||||
Short-Term Investments |
| 17,351,535 | 17,351,535 | |||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||
Total Value of Securities |
$ | 1,321,818,724 | $ | 17,351,535 | $ | 1,339,170,259 | ||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||
Optimum Small-Mid Cap Growth Fund | ||||||||||||||||||||||
Securities |
Level 1 |
Level 2 |
Level 3 |
Total |
||||||||||||||||||
Assets: |
||||||||||||||||||||||
Common Stock |
$ | 429,239,180 | $ | | $ | | $ | 429,239,180 | ||||||||||||||
Convertible Preferred Stock |
| 754,273 | 4,584,960 | 5,339,233 | ||||||||||||||||||
Short-Term Investments |
| 10,699,068 | | 10,699,068 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||
Total Value of Securities |
$ | 429,239,180 | $ | 11,453,341 | $ | 4,584,960 | $ | 445,277,481 | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||
Optimum Small-Mid Cap Value Fund |
||||||||||||||||||||||
Securities |
Level 1 |
Level 2 |
Total |
|||||||||||||||||||
Assets: |
||||||||||||||||||||||
Common Stock |
$ | 419,889,508 | $ | | $ | 419,889,508 | ||||||||||||||||
Short-Term Investments |
| 942,439 | 942,439 | |||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||
Total Value of Securities |
$ | 419,889,508 | $ | 942,439 | $ | 420,831,947 | ||||||||||||||||
|
|
|
|
|
|
Securities valued at zero on the Schedules of investments are considered to be Level 3 investments in these tables.
(continues) | 147 |
Notes to financial statements
Optimum Fund Trust
3. Investments (continued)
During the year ended March 31, 2017, there were no transfers between Level 1 investments, Level 2 investments, or Level 3 investments that had a significant impact to the Funds. This does not include transfers between Level 1 investments and Level 2 investments due to the Funds utilizing international fair value pricing during the year. In accordance with the fair valuation procedures described in Note 1, international fair value pricing of securities in each Fund occurs when market volatility exceeds an established rolling threshold. If the threshold is exceeded on a given date, then prices of international securities (those that traded on exchanges that close at a different time than the time that the Funds NAV is determined) are established using a separate pricing feed from a third-party vendor designed to establish a price for each such security as of the time that the Funds NAV is determined. Further, international fair value pricing uses other observable market-based inputs in place of the closing exchange price due to the events occurring after the close of the exchange or market on which the investment is principally traded, causing a change in classification between levels. International fair value pricing was not utilized at March 31, 2017. Each Funds policy is to recognize transfers between levels at the beginning of the reporting period.
A reconciliation of Level 3 investments is presented when each Fund has a significant amount of Level 3 investments at the beginning, interim, or end of the period in relation to each Funds net assets. With the exception of Optimum Small-Mid Cap Growth Fund, management has determined not to provide a reconciliation of Level 3 investments as they are not considered significant to each Funds net assets at the beginning, interim, or end of the year. Management has determined not to provide additional disclosure on Level 3 inputs since the Level 3 investments are not considered significant to each Funds net assets at the end of the year. There were no Level 3 investments during the year ended March 31, 2017 for Optimum Large Cap Value Fund and Optimum Small-Mid Cap Value Fund.
The following is a reconciliation of investments in which significant unobservable inputs (Level 3) were used in determining fair value for Optimum Small-Mid Cap Growth Fund:
Common Stock |
Convertible Preferred Stock |
Total | ||||||||||
Beginning balance March 31, 2016 |
$ | 296,387 | $ | 6,108,877 | $ | 6,405,264 | ||||||
Transfers out of Level 3 |
(366,983 | ) | (1,093,633 | ) | (1,460,616 | ) | ||||||
Net change in unrealized appreciation (depreciation) |
70,596 | (430,284 | ) | (359,688 | ) | |||||||
|
|
|
|
|
|
|||||||
Ending balance March 31, 2017 |
$ | | $ | 4,584,960 | $ | 4,584,960 | ||||||
|
|
|
|
|
|
|||||||
Net change in unrealized appreciation (depreciation) from investments still held at the end of the year |
$ | | $ | 164,731 | $ | 164,731 |
Each Fund fair values its financial instruments at fair value using independent pricing sources under the policies approved by the Board. The Pricing Committee is the committee formed by the advisor to develop pricing policies and procedures and to provide oversight of the pricing function for the Funds.
When market quotations are not readily available for one or more portfolio securities, the Funds NAV shall be calculated by using the fair value of the securities as determined by the Pricing Committee. Such fair value is the amount that a Fund might reasonably expect to receive for the security (or asset) upon its current sale. Each such determination should be based on a consideration of all relevant factors, which are likely to vary from one pricing context to another. Examples of such factors may include, but are not limited to: (i) the type of security, (ii) the size of the holding, (iii) the initial cost of the security, (iv) the existence of any contractual restrictions of the securitys disposition, (v) the price and extent of public trading in similar securities of the issuer or of comparable companies, (vi) quotations or evaluated prices from broker/dealers and/or pricing services, (vii) information obtained from the issuer, analysts, and/or appropriate stock exchange (for exchange-traded securities), (viii) an analysis of the companys financial statements, and (ix) an evaluation of the forces that influence the issuer and the market(s) in which the security is purchased and sold.
The Pricing Committee, or its delegate, employs various methods for calibrating these valuation approaches, including due diligence of the Funds pricing vendors and periodic back-testing of the prices that are fair valued under these procedures and reviews of any market related activity. The pricing of all securities fair valued by the Pricing Committee is subsequently reported to and approved by the Board on a quarterly basis.
148
Quantitative information about Level 3 fair value measurements for Optimum Small-Mid Cap Growth Fund are as follows:
Assets |
Value | Valuation |
Unobservable Inputs |
Range of Unobservable Inputs |
Weighted Average Discounted Enterprise Value / Revenue Multiple | |||||
Convertible |
$4,584,960 | Comparable company approach | Enterprise value /revenue multiple Range of comparable companies | 1.7x to 12.4x | 4.93× |
A significant change to the inputs may result in a significant change to the valuation.
4. Dividend and Distribution Information
Income and long-term capital gain distributions are determined in accordance with federal income tax regulations, which may differ from U.S. GAAP. Additionally, distributions from net gains on foreign currency transactions and net short-term gains on sales of investment securities are treated as ordinary income for federal income tax purposes. The tax character of dividends and distributions paid during the years ended March 31, 2017 and 2016 were as follows:
Year ended March 31, 2017
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund | |||||||||||||||||||||||||
Ordinary income |
$ | 40,065,220 | $ | 6,045,533 | $ | | $ | 16,750,245 | $ | $ | 2,301,127 | |||||||||||||||||||
Long-term capital gains |
| | 51,348,776 | 143,143,014 | | | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total |
$ | 40,065,220 | $ | 6,045,533 | $ | 51,348,776 | $ | 159,893,259 | $ | $ | 2,301,127 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Year ended March 31, 2016 |
|
|||||||||||||||||||||||||||||
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund | |||||||||||||||||||||||||
Ordinary income |
$ | 62,183,208 | $ | 4,359,777 | $ | 15,880,220 | $ | 14,923,587 | $ | 269,821 | $ | 303,097 | ||||||||||||||||||
Long-term capital gains |
1,046,441 | | 138,359,844 | | 68,382,173 | 17,425,944 | ||||||||||||||||||||||||
Return of capital |
| | | | 9,441 | 33,216 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total |
$ | 63,229,649 | $ | 4,359,777 | $ | 154,240,064 | $ | 14,923,587 | $ | 68,661,435 | $ | 17,762,257 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(continues) | 149 |
Notes to financial statements
Optimum Fund Trust
5. Components of Net Assets on a Tax Basis
As of March 31, 2017, the components of net assets on a tax basis were as follows:
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
||||||||||
Shares of beneficial interest |
$ | 1,905,050,974 | $ | 545,624,793 | $ | 1,128,928,892 | ||||||
Undistributed ordinary income |
14,262,271 | 1,627,894 | 921,920 | |||||||||
Undistributed long-term capital gains |
| | 66,277,800 | |||||||||
Capital loss carryforwards |
(32,138,119 | ) | (18,878,375 | ) | | |||||||
Other temporary difference* |
(970,052 | ) | | | ||||||||
Unrealized appreciation (depreciation) of investments, foreign currencies, and derivatives |
(3,053,981 | ) | 35,281,026 | 289,587,861 | ||||||||
|
|
|
|
|
|
|||||||
Net assets |
$ | 1,883,151,093 | $ | 563,655,338 | $ | 1,485,716,473 | ||||||
|
|
|
|
|
|
|||||||
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund |
||||||||||
Share of beneficial interest |
$ | 1,098,748,396 | $ | 368,909,369 | $ | 335,338,237 | ||||||
Undistributed ordinary income |
3,293,407 | | 1,942,057 | |||||||||
Undistributed long-term capital gains |
46,062,179 | 1,789,339 | 7,866,738 | |||||||||
Qualified late year ordinary losses deferred |
| (1,114,999 | ) | | ||||||||
Unrealized appreciation of investments and foreign currencies |
193,851,931 | 72,656,370 | 79,727,326 | |||||||||
|
|
|
|
|
|
|||||||
Net assets |
$ | 1,341,955,913 | $ | 442,240,079 | $ | 424,874,358 | ||||||
|
|
|
|
|
|
*See Note 13.
The differences between book basis and tax basis components of net assets are primarily attributable to tax deferral of losses on wash sales, tax deferral of losses on straddles, mark-to-market of foreign currency exchange contracts, mark-to-market of futures contracts, tax recognition of unrealized gain on passive foreign investment companies, tax treatment of contingent payment on debt instruments, amortization of premium on convertible securities, treasury inflation protected securities, troubled debt, partnership interest and swap contracts.
Qualified late year ordinary represent losses realized from Jan. 1, 2017 through March 31, 2017 that in accordance with federal income tax regulations, the Funds have elected to defer and treat as having arisen in the following fiscal year.
150
For financial reporting purposes, capital accounts are adjusted to reflect the tax character of permanent book/tax differences. Reclassifications are primarily due to tax treatment of net operating losses, redesignation of dividends and distributions, gain (loss) on foreign currency transactions, tax treatment of partnerships, amortization of premium on convertible securities, treasury inflation protected securities, CDS contracts, foreign capital gain tax, contingent payment on debt instruments, sale of passive foreign investment companies, and paydown gains (losses) of asset- and mortgage-backed securities. Results of operations and net assets were not affected by these reclassifications. For the year ended March 31, 2017, the Funds recorded the following reclassifications:
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund | |||||||||||||||||||||||||
Undistributed (accumulated) net investment income (loss) |
$ | 1,260,303 | $ | 54,046 | $ | 4,065,400 | $ | (140,056 | ) | $ | 4,151,855 | $ | 563,104 | |||||||||||||||||
Accumulated net realized gain (loss) |
(1,260,303 | ) | (54,046 | ) | (4,065,394 | ) | 140,056 | (2,084 | ) | (417,892 | ) | |||||||||||||||||||
Paid-in capital |
| | (6 | ) | | (4,149,771 | ) | (145,212 | ) |
For federal income tax purposes, capital loss carryforwards may be carried forward and applied against future capital gains. At March 31, 2017, Optimum International Fund and Optimum Large Cap Value Fund utilized $7,606,077 and $13,066,441, respectively, of capital loss carryforwards.
Under the Regulated Investment Company Modernization Act of 2010 (Act), net capital losses recognized for tax years beginning after Dec. 22, 2010 may be carried forward indefinitely, and their character is retained as short-term and/or long-term losses. Previously, net capital losses were carried forward for eight years and treated as short-term losses. As a transition rule, the Act requires that post-enactment net capital losses be used before pre-enactment net capital losses.
At March 31, 2017, there were no capital loss carryforwards for Optimum Large Cap Growth Fund, Optimum Large Cap Value Fund, Optimum Small-Mid Cap Growth Fund, and Optimum Small-Mid Cap Value Fund. Capital loss carryforwards available to offset future realized capital gains, through the indicated expiration dates for Optimum Fixed Income Fund and Optimum International Fund were as follows:
Pre-enactment capital loss | No expiration | |||||||||||||||||||||||||||||||||
Expiration date | Post-enactment capital loss character | |||||||||||||||||||||||||||||||||
2018 | Short-term | Long-term | Total | |||||||||||||||||||||||||||||||
Optimum Fixed Income Fund |
$ | | $ | 11,736,396 | $ | 20,401,723 | $ | 32,138,119 | ||||||||||||||||||||||||||
Optimum International Fund |
4,316,656 | 9,162,162 | 5,399,557 | 18,878,375 |
(continues) | 151 |
Notes to financial statements
Optimum Fund Trust
6. Capital Shares
Transactions in capital shares were as follows:
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
||||||||||||||||||||||
Year ended | Year ended | Year ended | ||||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/17 | 3/31/16 | 3/31/17 | 3/31/16 | |||||||||||||||||||
Shares sold: |
||||||||||||||||||||||||
Class A |
277,152 | 484,087 | 55,487 | 106,661 | 102,264 | 134,056 | ||||||||||||||||||
Class C |
762,019 | 2,109,294 | 164,385 | 370,858 | 359,119 | 569,981 | ||||||||||||||||||
Institutional Class |
39,990,811 | 50,670,245 | 7,475,950 | 16,417,062 | 13,872,596 | 16,932,034 | ||||||||||||||||||
Shares issued upon reinvestment of dividends and distributions: |
||||||||||||||||||||||||
Class A |
73,073 | 126,444 | 6,992 | 4,638 | 78,519 | 233,634 | ||||||||||||||||||
Class C |
164,873 | 363,757 | 5,854 | | 319,613 | 992,070 | ||||||||||||||||||
Institutional Class |
4,107,100 | 6,368,876 | 513,028 | 394,001 | 2,831,952 | 8,237,260 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
45,375,028 | 60,122,703 | 8,221,696 | 17,293,220 | 17,564,063 | 27,099,035 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Shares redeemed: |
||||||||||||||||||||||||
Class A |
(966,352 | ) | (831,370 | ) | (188,046 | ) | (160,976 | ) | (524,169 | ) | (510,659 | ) | ||||||||||||
Class C |
(4,076,187 | ) | (3,222,618 | ) | (675,780 | ) | (552,865 | ) | (2,200,265 | ) | (1,879,403 | ) | ||||||||||||
Institutional Class |
(62,330,129 | ) | (43,001,210 | ) | (14,653,443 | ) | (8,328,689 | ) | (27,022,876 | ) | (18,670,206 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
(67,372,668 | ) | (47,055,198 | ) | (15,517,269 | ) | (9,042,530 | ) | (29,747,310 | ) | (21,060,268 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net increase (decrease) |
(21,997,640 | ) | 13,067,505 | (7,295,573 | ) | 8,250,690 | (12,183,247 | ) | 6,038,767 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund |
||||||||||||||||||||||
Year ended | Year ended | Year ended | ||||||||||||||||||||||
3/31/17 | 3/31/16 | 3/31/17 | 3/31/16 | 3/31/17 | 3/31/16 | |||||||||||||||||||
Shares sold: |
||||||||||||||||||||||||
Class A |
103,359 | 143,327 | 35,937 | 33,959 | 30,413 | 33,499 | ||||||||||||||||||
Class C |
333,639 | 531,160 | 97,187 | 127,921 | 57,348 | 113,119 | ||||||||||||||||||
Institutional Class |
20,845,005 | 16,516,757 | 6,203,398 | 8,398,792 | 5,847,685 | 8,991,621 | ||||||||||||||||||
Shares issued upon reinvestment of dividends and distributions: |
||||||||||||||||||||||||
Class A |
233,309 | 20,818 | | 70,219 | 1,195 | 15,444 | ||||||||||||||||||
Class C |
726,016 | 18,116 | | 296,465 | | 68,396 | ||||||||||||||||||
Institutional Class |
9,693,331 | 937,805 | | 5,097,525 | 159,920 | 1,361,942 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
31,934,659 | 18,167,983 | 6,336,522 | 14,024,881 | 6,096,561 | 10,584,021 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Shares redeemed: |
||||||||||||||||||||||||
Class A |
(489,275 | ) | (394,347 | ) | (98,337 | ) | (102,565 | ) | (93,744 | ) | (74,853 | ) | ||||||||||||
Class C |
(1,716,380 | ) | (1,375,133 | ) | (425,001 | ) | (332,514 | ) | (362,310 | ) | (273,196 | ) | ||||||||||||
Institutional Class |
(26,278,928 | ) | (14,408,404 | ) | (14,415,539 | ) | (8,288,503 | ) | (14,304,324 | ) | (8,979,943 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
(28,484,583 | ) | (16,177,884 | ) | (14,938,877 | ) | (8,723,582 | ) | (14,760,378 | ) | (9,327,992 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net increase (decrease) |
3,450,076 | 1,990,099 | (8,602,355 | ) | 5,301,299 | (8,663,817 | ) | 1,256,029 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
152
Certain shareholders may exchange shares of one class for another class in the same Fund. There were no exchange transactions for the year ended March 31, 2017. For the year ended March 31, 2016, each Fund had the following exchange transactions. These exchange transactions are included as subscriptions and redemptions in the table on the previous page and the Statements of changes in net assets.
Year ended 3/31/16 |
|||||||||||||||
Exchange Redemptions |
Exchange Subscriptions |
||||||||||||||
Class C Shares | Class A Shares | Value | |||||||||||||
Optimum Fixed Income Fund |
10,722 | 10,688 | $ | 102,288 | |||||||||||
Optimum International Fund |
1,512 | 1,476 | 17,488 | ||||||||||||
Optimum Large Cap Growth Fund |
4,535 | 4,109 | 73,970 | ||||||||||||
Optimum Large Cap Value Fund |
3,867 | 3,821 | 61,640 | ||||||||||||
Optimum Small-Mid Cap Growth Fund |
837 | 753 | 11,843 | ||||||||||||
Optimum Small-Mid Cap Value Fund |
652 | 587 | 7,731 |
7. Derivatives
U.S. GAAP requires disclosures that enable investors to understand: (1) how and why an entity uses derivatives; (2) how they are accounted for; and (3) how they affect an entitys results of operations and financial position.
Foreign Currency Exchange Contracts Each Fund may enter into foreign currency exchange contracts and foreign cross currency exchange contracts as a way of managing foreign exchange rate risk. Each Fund may also enter into these contracts to fix the U.S. dollar value of a security that it has agreed to buy or sell for the period between the date the trade was entered into and the date the security is delivered and paid for. Each Fund may enter into these contracts to hedge the U.S. dollar value of securities it already owns that are denominated in foreign currencies. In addition, each Fund may enter into these contracts to facilitate or expedite the settlement of portfolio transactions. The change in value is recorded as an unrealized gain or loss. When the contract is closed, a realized gain or loss is recorded equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed.
The use of foreign currency exchange contracts and foreign cross currency exchange contracts does not eliminate fluctuations in the underlying prices of the securities, but does establish a rate of exchange that can be achieved in the future. Although foreign currency exchange contracts and foreign cross currency exchange contracts limit the risk of loss due to an unfavorable change in the value of the hedged currency, they also limit any potential gain that might result should the value of the currency change favorably. In addition, each Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts. Each Funds maximum risk of loss from counterparty credit risk is the value of its currency exchanged with the counterparty. The risk is generally mitigated by having a netting arrangement between the Funds and the counterparty and by the posting of collateral by the counterparty to the Funds to cover the Funds exposure to the counterparty.
During the year ended March 31, 2017, with the exception of Optimum Small-Mid Cap Value Fund, the Funds used foreign currency exchange contracts to fix the U.S. dollar value of a security between trade date and settlement date, to hedge the U.S. dollar value of securities the Funds already own that are denominated in foreign currencies, and to facilitate or expedite the settlement of portfolio transactions.
During the year ended March 31, 2017, with the exception of Optimum Small-Mid Cap Value, held foreign currency exchange contracts which are reflected on the Statements of operations under Net realized and unrealized gain (loss) on foreign currency exchange contracts.
Futures Contracts A futures contract is an agreement in which the writer (or seller) of the contract agrees to deliver to the buyer an amount of cash or securities equal to a specific dollar amount times the difference between the value of a specific security or index at the close of the last trading day of the contract and the price at which the agreement is made. Optimum Fixed Income Fund may use futures in the normal course of pursuing its investment objective. Optimum Fixed Income Fund may invest in futures contracts to hedge its existing portfolio securities against fluctuations in fair value caused by changes in interest rates or market conditions. Upon entering into a futures contract, the Fund deposits cash or pledges U.S. government securities to a broker, equal to the minimum initial margin requirements of the exchange on which the contract is traded. Subsequent payments are received from the broker or paid to the broker each day, based on the daily fluctuation in the market value of the contract. These receipts or payments are known as variation margin and are recorded daily by the Fund as unrealized gains or losses until the contracts are closed. When the contracts are closed, the Fund records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed. Risks of entering into futures contracts include potential imperfect correlation between the futures contracts and the underlying securities and the possibility of an illiquid
(continues) | 153 |
Notes to financial statements
Optimum Fund Trust
7. Derivatives (continued)
secondary market for these instruments. When investing in futures, there is reduced counterparty credit risk to the Fund because futures are exchange-traded and the exchanges clearinghouse, as counterparty to all exchange-traded futures, guarantees against default. The Fund posted $1,832,000 cash and securities collateral valued at $4,887,228, as margin for open futures contracts. Securities collateral are presented on the Schedules of investments and cash collateral is presented on the Statements of assets and liabilities as Cash collateral due from brokers.
During the year ended March 31, 2017, Optimum Fixed Income Fund used futures contracts to hedge the Funds existing portfolio securities against fluctuations in value caused by changes in interest rates or market conditions and to facilitate investments in portfolio securities.
Options Contracts Optimum Fixed Income Fund may enter into options contracts in the normal course of pursuing its investment objective. The Fund may buy or write options contracts for any number of reasons, including without limitation: to manage the Funds exposure to changes in securities prices caused by interest rates or market conditions and foreign currencies; as an efficient means of adjusting the Funds overall exposure to certain markets; to protect the value of portfolio securities; and as a cash management tool. The Fund may buy or write call or put options on securities, futures, swaps, swaptions, financial indices, and foreign currencies. When the Fund buys an option, a premium is paid and an asset is recorded and adjusted on a daily basis to reflect the current market value of the option purchased. When the Fund writes an option, a premium is received and a liability is recorded and adjusted on a daily basis to reflect the current market value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains. The difference between the premium received and the amount paid on effecting a closing purchase transaction, including brokerage commissions, is treated as realized gain or loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security in determining whether the Fund has a realized gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. The Fund, as writer of an option, bears the market risk of an unfavorable change in the price of the security underlying the written option. When writing options, the Fund is subject to minimal counterparty risk because the counterparty is only obligated to pay premiums and does not bear the market risk of an unfavorable market change.
Transactions in options written during the year ended March 31, 2017 for Optimum Fixed Income Fund were as follows:
Number of | ||||||||
Call options |
contracts | Premiums | ||||||
Options outstanding March 31, 2016 |
73,110,000 | $ | 255,102 | |||||
Options written |
108,662,827 | 1,626,440 | ||||||
Options expired |
(148,472,100 | ) | (701,211 | ) | ||||
Options terminated in closing purchase transactions |
(14,200,363 | ) | (412,865 | ) | ||||
|
|
|
|
|||||
Options outstanding March 31, 2017 |
19,100,364 | $ | 767,466 | |||||
|
|
|
|
|||||
Number of | ||||||||
Put options |
contracts | Premiums | ||||||
Options outstanding March 31, 2016 |
268,400,364 | $ | 1,351,614 | |||||
Options written |
164,162,769 | 1,096,441 | ||||||
Options expired |
(300,762,920 | ) | (1,370,893 | ) | ||||
Options terminated in closing purchase transactions |
(108,400,213 | ) | (626,914 | ) | ||||
|
|
|
|
|||||
Options outstanding March 31, 2017 |
23,400,000 | $ | 450,248 | |||||
|
|
|
|
During the year ended March 31, 2017, Optimum Fixed Income Fund used options contracts to manage the Funds exposure to changes in securities prices caused by interest rates or market conditions, to adjust the Funds overall exposure to certain markets, to protect the value of portfolio securities, to manage the Funds exposure to changes in foreign currencies, and to receive premiums for writing options.
Swap Contracts Optimum Fixed Income Fund may enter into currency swap contracts, index swap contracts, inflation swaps, interest rate swap contracts, and CDS contracts in the normal course of pursuing its investment objective. The Fund may invest in interest rate swaps to manage the Funds sensitivity to interest rates or to hedge against changes in interest rates. The Fund may use currency swaps to protect against currency fluctuations. The Fund may use inflation swaps to hedge the inflation risk in nominal bonds, thereby creating synthetic inflation-indexed bonds. The Fund may enter into CDS contracts in order to hedge against a credit event, to enhance total return or to gain exposure to certain securities or markets. The Fund will not be permitted to enter into any swap transactions unless, at the time of entering into
154
such transactions, the unsecured long-term debt of the actual counterparty, combined with any credit enhancements, is rated at least BBB- by Standard & Poors Financial Services LLC. (S&P) or Baa3 by Moodys Investors Service Inc. (Moodys) or is determined to be of equivalent credit quality by DMC.
Inflation Swaps. Inflation swap agreements involve commitments to pay a regular stream of inflation-indexed cash payments in exchange for receiving a stream of nominal interest payments (or vice versa), where both payment streams are based on notional amounts. The nominal interest payments may be based on either a fixed interest rate or variable interest rate such as the London Interbank Offered Rate (LIBOR). The change in value of swap contracts outstanding, if any, is recorded as unrealized appreciation or depreciation. A realized gain or loss is recorded on maturity or termination of the swap contract. The Funds maximum risk of loss from counterparty credit risk is the discounted net value of the cash flows to be received from/paid to the counterparty over the swap contracts remaining life, to the extent that the amount is positive. This risk is mitigated, for bilateral swap contracts, by having a netting arrangement between the Fund and the counterparty and by the posting of collateral by the counterparty to the Fund to cover the Funds exposure to the counterparty.
During the year ended March 31, 2017, Optimum Fixed Income Fund used inflation swaps to hedge the inflation risk in nominal bonds (i.e., non-inflation-protected bonds) thereby creating synthetic inflation-indexed bonds.
Interest Rate Swaps. An interest rate swap contract is an exchange of interest rates between counterparties. In one instance, an interest rate swap involves payments received by Optimum Fixed Income Fund from another party based on a variable or floating interest rate, in return for making payments based on a fixed interest rate. An interest rate swap can also work in reverse with the Fund receiving payments based on a fixed interest rate and making payments based on a variable or floating interest rate. Interest rate swaps may be used to adjust the Funds sensitivity to interest rates or to hedge against changes in interest rates. Periodic payments on such contracts are accrued daily and recorded as unrealized appreciation (depreciation) on swap contracts. Upon periodic payment (receipt) or termination of the contract, such amounts are recorded as realized gains or losses on swap contracts. The Funds maximum risk of loss from counterparty credit risk is the discounted net value of the cash flows to be received from/paid to the counterparty over the interest rate swap contracts remaining life, to the extent that the amount is positive. This risk is mitigated by (1) for bilateral swap contracts, having a netting arrangement between the Fund and the counterparty and by the posting of collateral by the counterparty to the Fund to cover the Funds exposure to the counterparty and (2) for cleared swaps, trading these instruments through a central counterparty.
During the year ended March 31, 2017, Optimum Fixed Income Fund entered into interest rate swap contracts to manage the Funds sensitivity to interest rates or to hedge against changes in interest rates.
Credit Default Swaps. A CDS contract is a risk-transfer instrument through which one party (purchaser of protection) transfers to another party (seller of protection) the financial risk of a credit event (as defined in the CDS agreement), as it relates to a particular reference security or basket of securities (such as an index). In exchange for the protection offered by the seller of protection, the purchaser of protection agrees to pay the seller of protection a periodic amount at a stated rate that is applied to the notional amount of the CDS contract. In addition, an upfront payment may be made or received by the Fund in connection with an unwinding or assignment of a CDS contract. Upon the occurrence of a credit event, the seller of protection would pay the par (or other agreed-upon) value of the reference security (or basket of securities) to the counterparty. Credit events generally include, among others, bankruptcy, failure to pay, and obligation default.
During the year ended March 31, 2017, Optimum Fixed Income Fund entered into CDS contracts as a purchaser and seller of protection, as a hedge against credit events. Periodic payments (receipts) on such contracts are accrued daily and recorded as unrealized losses (gains) on swap contracts. Upon payment (receipt), such amounts are recorded as realized losses (gains) on swap contracts. Upfront payments made or received in connection with CDS contracts are amortized over the expected life of the CDS contracts as unrealized losses (gains) on swap contracts. The change in value of CDS contracts is recorded daily as unrealized appreciation or depreciation. A realized gain or loss is recorded upon a credit event (as defined in the CDS agreement) or the maturity or termination of the agreement. Initial margin and variation margin are posted to central counterparties for centrally cleared CDS basket trades, as determined by the applicable central counterparty.
As disclosed in the footnotes to the Schedules of investments, at March 31, 2017, the notional value of the protection sold was EUR 2,500,000 and USD 42,500,000, which reflects the maximum potential amount Optimum Fixed Income Fund would have been required to make as a seller of credit protection if a credit event had occurred. In addition to serving as the source of the current value of the securities, the quoted market prices and resulting market values for credit default swap agreements on securities and credit indices serve as an indicator of the current status of the payment/performance risk and represent the likelihood of an expected liability (or profit) for the credit derivative if the swap agreement has been closed/sold as of the period end. Increasing market values, in absolute terms when compared to the notional amount
(continues) | 155 |
Notes to financial statements
Optimum Fund Trust
7. Derivatives (continued)
of the swap, represent a deterioration of the reference entitys credit soundness and a greater likelihood of risk of default or other credit event occurring as defined under the terms of the agreement. At March 31, 2017, net unrealized appreciation of the protection sold was $922,796.
CDS contracts may involve greater risks than if Optimum Fixed Income Fund had invested in the reference obligation directly. CDS contracts are subject to general market risk, liquidity risk, counterparty risk, and credit risk. The Funds maximum risk of loss from counterparty credit risk, either as the seller of protection or the buyer of protection, is the fair value of the contract. This risk is mitigated by (1) for bilateral swap contracts, having a netting arrangement between the Fund and the counterparty and by the posting of collateral by the counterparty to the Fund to cover the Funds exposure to the counterparty and (2) for cleared swaps, trading these instruments through a central counterparty.
During the year ended March 31, 2017, Optimum Fixed Income Fund used CDS contracts to hedge against credit events, to enhance total return, and to gain exposure to certain securities or markets.
Swaps Generally. The value of open swaps may differ from that which would be realized in the event Optimum Fixed Income Fund terminated its position in the contract on a given day. Risks of entering into these contracts include the potential inability of the counterparty to meet the terms of the contracts. This type of risk is generally limited to the amount of favorable movement in the value of the underlying security, instrument or basket of instruments, if any, at the day of default. Risks also arise from potential losses from adverse market movements and such losses could exceed the unrealized amounts shown on the Schedules of investments.
At March 31, 2017, for bilateral derivative contracts, Optimum Fixed Income Fund posted $640,000 in cash collateral for certain open derivatives, which is presented as Cash collateral due from brokers on the Statements of assets and liabilities. Optimum Fixed Income Fund posted $2,266,553 cash and $3,193,991 securities collateral respectively for certain centrally cleared derivatives. Cash collateral is presented as Cash collateral due from brokers on the Statements of assets and liabilities and securities collateral is presented on the Schedules of investments. At March 31, 2017, for bilateral derivative contracts, the Fund received $680,000 in cash collateral. Cash collateral received is presented as Cash collateral due to brokers on the Statements of assets and liabilities.
Fair values of derivative instruments for Optimum Fixed Income Fund as of March 31, 2017 were as follows:
Asset Derivatives | ||||||||||||||||||||
Fair Value | ||||||||||||||||||||
Currency | Interest rate | Credit | ||||||||||||||||||
Statements of Assets and Liabilities Location | Contracts | Contracts | Contracts | Total | ||||||||||||||||
Unrealized appreciation of foreign currency exchange contracts |
$ | 1,367,637 | $ | | $ | | $ | 1,367,637 | ||||||||||||
Variation margin due from broker on futures contracts* |
2,027,864 | 1,025,764 | | 3,053,628 | ||||||||||||||||
Unrealized appreciation of swap contracts |
| 2,898,329 | 991,235 | 3,889,564 | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||
Total |
$ | 3,395,501 | $ | 3,924,093 | $ | 991,235 | $ | 8,310,829 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||
Liability Derivatives | ||||||||||||||||||||
Fair Value | ||||||||||||||||||||
Currency | Interest | Credit | ||||||||||||||||||
Statements of Assets and Liabilities Location | Contracts | Contracts | Contracts | Total | ||||||||||||||||
Unrealized depreciation of foreign currency exchange contracts |
$ | (1,101,958 | ) | $ | | $ | | $ | (1,101,958 | ) | ||||||||||
Variation margin due from broker on futures contracts* |
(439,390 | ) | (84,910 | ) | | (524,300 | ) | |||||||||||||
Options written, at value |
| (701,385 | ) | | (701,385 | ) | ||||||||||||||
Variation margin due to brokers on centrally cleared swap contracts |
| (105,256 | ) | (2,777 | ) | (108,033 | ) | |||||||||||||
Unrealized depreciation of swap contracts |
| (820,608 | ) | (403,722 | ) | (1,224,330 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||
Total |
$ | (1,541,348 | ) | $ | (1,712,159 | ) | $ | (406,499 | ) | $ | (3,660,006 | ) | ||||||||
|
|
|
|
|
|
|
|
*Includes cumulative appreciation (depreciation) of futures contracts from the date the contracts were opened through March 31, 2017. Only current day variation margin is reported on Optimum Fixed Income Funds Statements of assets and liabilities.
156
The effect of derivative instruments on Optimum Fixed Income Funds Statements of operations for the year ended March 31, 2017 was as follows:
Net Realized Gain (Loss) on: | ||||||||||||||||||||||||||||||
Foreign Currency Exchange Contracts |
Futures Contracts |
Options Purchased |
Options Written |
Swap Contracts |
Total | |||||||||||||||||||||||||
Currency contracts |
$ | 3,099,794 | $ | (1,268,969 | ) | $ | (7,710 | ) | $ | 886,324 | $ | | $ | 2,709,439 | ||||||||||||||||
Equity contracts |
| (1,182,939 | ) | | | | (1,182,939 | ) | ||||||||||||||||||||||
Interest rate contracts |
| (11,496,854 | ) | (149,350 | ) | 1,017,464 | (2,517,361 | ) | (13,146,101 | ) | ||||||||||||||||||||
Credit contracts |
| | 50,421 | (295,308 | ) | (244,887 | ) | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total |
$ | 3,099,794 | $ | (13,948,762 | ) | $ | (157,060 | ) | $ | 1,954,209 | $ | (2,812,669 | ) | $ | (11,864,488 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Net Change in Unrealized Appreciation (Depreciation) of: | ||||||||||||||||||||||||||||||
Foreign | ||||||||||||||||||||||||||||||
Currency | ||||||||||||||||||||||||||||||
Exchange | Futures | Options | Options | Swap | ||||||||||||||||||||||||||
Contracts | Contracts | Purchased | Written | Contracts | Total | |||||||||||||||||||||||||
Currency contracts |
$ | 2,823,705 | $ | 4,302,511 | $ | (6,213 | ) | $ | 141,422 | $ | | $ | 7,261,425 | |||||||||||||||||
Equity contracts |
| 77,415 | | | | 77,415 | ||||||||||||||||||||||||
Interest rate contracts |
| 185,574 | 327,821 | (409,383 | ) | 12,913,848 | 13,017,860 | |||||||||||||||||||||||
Credit contracts |
| | | (30,903 | ) | 350,810 | 319,907 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total |
$ | 2,823,705 | $ | 4,565,500 | $ | 321,608 | $ | (298,864 | ) | $ | 13,264,658 | $ | 20,676,607 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Derivatives generally. The tables below summarize the average balance of derivative holdings by the Funds during the year ended March 31, 2017.
Long Derivative Volume | ||||||||||||||||||||||||||||
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
|||||||||||||||||||||||||
Foreign currency exchange contracts (average cost) |
USD | 50,814,217 | USD 872,751 | USD | | USD | 30,579 | |||||||||||||||||||||
Futures contracts |
390,822,572 | | | | ||||||||||||||||||||||||
Options contracts |
381,711 | | | | ||||||||||||||||||||||||
CDS contracts |
EUR | 612,075 | | | | |||||||||||||||||||||||
USD | 15,636,490 | | | | ||||||||||||||||||||||||
Inflation swap contracts |
158,103 | | | | ||||||||||||||||||||||||
Interest rate swap contracts |
| | | |||||||||||||||||||||||||
CAD | 4,122,925 | | | | ||||||||||||||||||||||||
MXN | 322,062,055 | | | | ||||||||||||||||||||||||
USD | 11,218,636 | | | |
(continues) | 157 |
Notes to financial statements
Optimum Fund Trust
7. Derivatives (continued)
Short Derivative Volume | ||||||||||||||||||||||||||
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
|||||||||||||||||||||||
Foreign currency exchange contracts |
USD | 147,204,543 | USD 920,882 | USD | 18,564 | USD | 24,965 | |||||||||||||||||||
Futures contracts |
934,390,947 | | | | ||||||||||||||||||||||
Options contracts |
501,242 | | | | ||||||||||||||||||||||
CDS contracts |
EUR | 3,822,134 | | | | |||||||||||||||||||||
USD | 40,811,166 | | | | ||||||||||||||||||||||
Interest rate swap contracts |
GBP | 3,568,379 | | | | |||||||||||||||||||||
MXN | 10,131,225 | | | | ||||||||||||||||||||||
USD | 242,306,937 | | | |
* Long represents buying protection and short represents selling protection.
** Long represents receiving fixed interest payments and short represents paying fixed interest payments.
8. Offsetting
In December 2011, the Financial Accounting Standards Board (FASB) issued guidance that expanded disclosure requirements on the offsetting of certain assets and liabilities. The disclosures are required for investments and derivative financial instruments subject to master netting or similar agreements which are eligible for offset on the Statements of assets and liabilities and require an entity to disclose both gross and net information about such investments and transactions in the financial statements. In January 2013, the FASB issued guidance that clarified which investments and transactions are subject to the offsetting disclosure requirements. The scope of the disclosure requirements for offsetting is limited to derivative instruments, repurchase agreements and reverse repurchase agreements, and securities borrowing.
In order to better define its contractual rights and to secure rights that will help the Funds mitigate its counterparty risk, each Fund entered into an International Swaps and Derivatives Association, Inc. Master Agreement (ISDA Master Agreement) or a similar agreement with certain of its derivative contract counterparties. An ISDA Master Agreement is a bilateral agreement between each Fund and a counterparty that governs certain over-the-counter (OTC) derivatives and foreign exchange contracts and typically contains, among other things, collateral posting items and netting provisions in the event of a default and/or termination event. Under an ISDA Master Agreement, each Fund may, under certain circumstances, offset with the counterparty certain derivative financial instruments payables and/or receivables with collateral held and/or posted and create one single net payment. The provisions of the ISDA Master Agreement typically permit a single net payment in the event of default (close-out), including the bankruptcy or insolvency of the counterparty. However, bankruptcy, or insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against the right of offset in bankruptcy, insolvency, or other events.
For financial reporting purposes, each Fund does not offset derivative assets and derivative liabilities that are subject to netting arrangements on the Statements of assets and liabilities.
158
At March 31, 2017, Optimum Fixed Income Fund and Optimum International Fund had the following assets and liabilities subject to offsetting provisions:
Offsetting of Financial Assets and Liabilities and Derivative Assets and Liabilities
Optimum Fixed Income Fund | |||||||||||||||
Gross Value of | Gross Value of | ||||||||||||||
Counterparty |
Derivative Asset | Derivative Liability | Net Position | ||||||||||||
Bank of America Merrill Lynch |
$ | 521,784 | $ | (478,028 | ) | $ | 43,756 | ||||||||
Barclays Bank |
17,069 | (4,208 | ) | 12,861 | |||||||||||
BNP Paribas |
319,005 | (429,363 | ) | (110,358 | ) | ||||||||||
Bank of New York Mellon |
| (9 | ) | (9 | ) | ||||||||||
Citigroup Global Markets |
4,872 | (1,900 | ) | 2,972 | |||||||||||
Deutsche Bank |
745,453 | | 745,453 | ||||||||||||
Goldman Sachs |
86,789 | | 86,789 | ||||||||||||
Hong Kong Shanghai Bank |
2,778 | (6,880 | ) | (4,102 | ) | ||||||||||
JPMorgan Chase Bank |
654,299 | (259,159 | ) | 395,140 | |||||||||||
Morgan Stanley Capital |
500,515 | (458,618 | ) | 41,897 | |||||||||||
Toronto Dominion Bank |
15,137 | (11,478 | ) | 3,659 | |||||||||||
|
|
|
|
|
|
||||||||||
Total |
$ | 2,867,701 | $ | (1,649,643 | ) | $ | 1,218,058 | ||||||||
|
|
|
|
|
|
Optimum Fixed Income Fund | ||||||||||||||||||||||||||||||
Counterparty |
Net Position | Fair Value of Non-Cash Collateral Received |
Cash Collateral Received |
Fair Value of Non-Cash Collateral Pledged |
Cash Collateral Pledged |
Net Exposure(b) | ||||||||||||||||||||||||
Bank of America Merrill Lynch |
$ | 43,756 | $ | | $ | | $ | | $ | | $ | 43,756 | ||||||||||||||||||
Barclays Bank |
12,861 | | | | | 12,861 | ||||||||||||||||||||||||
BNP Paribas |
(110,358 | ) | | | | 110,358 | | |||||||||||||||||||||||
Bank of New York Mellon |
(9 | ) | | | | | (9 | ) | ||||||||||||||||||||||
Citigroup Global Markets |
2,972 | | | | | 2,972 | ||||||||||||||||||||||||
Deutsche Bank |
745,453 | | | | | 745,453 | ||||||||||||||||||||||||
Goldman Sachs |
86,789 | | | | | 86,789 | ||||||||||||||||||||||||
Hong Kong Shanghai Bank |
(4,102 | ) | | | | (4,102 | ) | |||||||||||||||||||||||
JPMorgan Chase Bank |
395,140 | | (395,140 | ) | | | | |||||||||||||||||||||||
Morgan Stanley Capital |
41,897 | | (10,000 | ) | | | 31,897 | |||||||||||||||||||||||
Toronto Dominion Bank |
3,659 | | | | | 3,659 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total |
$ | 1,218,058 | $ | | $ | (405,140 | ) | $ | | $ | 110,358 | $ | 923,276 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(continues) | 159 |
Notes to financial statements
Optimum Fund Trust
8. Offsetting (continued)
Optimum International Fund | ||||||
Gross Value of | Gross Value of | |||||
Counterparty |
Derivative Asset | Derivative Liability | Net Position | |||
Brown Brothers Harriman |
$ | $(530) | $(530) |
Optimum International Fund | ||||||||||||
Fair Value of | Fair Value of | |||||||||||
Non-Cash | Cash Collateral | Non-Cash | Cash Collateral | |||||||||
Counterparty |
Net Position | Collateral Received | Received | Collateral Pledged | Pledged | Net Exposure(b) | ||||||
Brown Brothers Harriman |
$(530) | $ | $ | $ | $ | $(530) |
Master Repurchase Agreements
Optimum Fixed Income Fund | |||||||||||||||||||||||||
Counterparty |
Repurchase Agreements |
Fair Value of Non-Cash Collateral Received(a) |
Cash Collateral Received |
Net Collateral Received |
Net Exposure(b) | ||||||||||||||||||||
Bank of America Merrill Lynch |
$ | 5,743,260 | $ | (5,743,260 | ) | $ | | $ | (5,743,260 | ) | $ | | |||||||||||||
Bank of Montreal |
5,743,260 | (5,743,260 | ) | | (5,743,260 | ) | | ||||||||||||||||||
BNP Paribas |
6,094,480 | (6,094,480 | ) | | (6,094,480 | ) | | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Total |
$ | 17,581,000 | $ | (17,581,000 | ) | $ | | $ | (17,581,000 | ) | $ | | |||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Optimum International Fund | |||||||||||||||||||||||||
Counterparty |
Repurchase Agreements |
Fair Value of Non-Cash Collateral Received(a) |
Cash Collateral Received |
Net Collateral Received |
Net Exposure(b) | ||||||||||||||||||||
Bank of America Merrill Lynch |
$ | 999,296 | $ | (999,296 | ) | $ | | $ | (999,296 | ) | $ | | |||||||||||||
Bank of Montreal |
999,297 | (999,297 | ) | | (999,297 | ) | | ||||||||||||||||||
BNP Paribas |
1,060,407 | (1,060,407 | ) | | (1,060,407 | ) | | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Total |
$ | 3,059,000 | $ | (3,059,000 | ) | $ | | $ | (3,059,000 | ) | $ | | |||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Optimum Large Cap Growth Fund | |||||||||||||||||||||||||
Counterparty |
Repurchase Agreements |
Fair Value of Non-Cash Collateral Received(a) |
Cash Collateral Received |
Net Collateral Received |
Net Exposure(b) | ||||||||||||||||||||
Bank of America Merrill Lynch |
$ | 7,137,179 | $ | (7,137,179 | ) | $ | | $ | (7,137,179 | ) | $ | | |||||||||||||
Bank of Montreal |
7,137,179 | (7,137,179 | ) | | (7,137,179 | ) | | ||||||||||||||||||
BNP Paribas |
7,573,642 | (7,573,642 | ) | | (7,573,642 | ) | | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Total |
$ | 21,848,000 | $ | (21,848,000 | ) | $ | | $ | (21,848,000 | ) | $ | | |||||||||||||
|
|
|
|
|
|
|
|
|
|
160
Optimum Large Cap Value Fund | |||||||||||||||||||||||||
Counterparty |
Repurchase Agreements |
Fair Value of Non-Cash Collateral Received(a) |
Cash Collateral Received |
Net Collateral Received |
Net Exposure(b) | ||||||||||||||||||||
Bank of America Merrill Lynch |
$ | 3,112,552 | $ | (3,112,552 | ) | $ | | $ | (3,112,552 | ) | $ | | |||||||||||||
Bank of Montreal |
3,112,553 | (3,112,553 | ) | | (3,112,553 | ) | | ||||||||||||||||||
BNP Paribas |
3,302,895 | (3,302,895 | ) | | (3,302,895 | ) | | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Total |
$ | 9,528,000 | $ | (9,528,000 | ) | $ | | $ | (9,528,000 | ) | $ | | |||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Optimum Small-Mid Cap Growth Fund | |||||||||||||||||||||||||
Counterparty |
Repurchase Agreements |
Fair Value of Non-Cash Collateral Received(a) |
Cash Collateral Received |
Net Collateral Received |
Net Exposure(b) | ||||||||||||||||||||
Bank of America Merrill Lynch |
$ | 1,024,124 | $ | (1,024,124 | ) | $ | | $ | (1,024,124 | ) | $ | | |||||||||||||
Bank of Montreal |
1,024,124 | (1,024,124 | ) | | (1,024,124 | ) | | ||||||||||||||||||
BNP Paribas |
1,086,752 | (1,086,752 | ) | | (1,086,752 | ) | | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Total |
$ | 3,135,000 | $ | (3,135,000 | ) | $ | | $ | (3,135,000 | ) | $ | | |||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Optimum Small-Mid Cap Value Fund | |||||||||||||||||||||||||
Counterparty |
Repurchase Agreements |
Fair Value of Non-Cash Collateral Received(a) |
Cash Collateral Received |
Net Collateral Received |
Net Exposure(b) | ||||||||||||||||||||
Bank of America Merrill Lynch |
$ | 212,338 | $ | (212,338 | ) | $ | | $ | (212,338 | ) | $ | | |||||||||||||
Bank of Montreal |
212,338 | (212,338 | ) | | (212,338 | ) | | ||||||||||||||||||
BNP Paribas |
225,324 | (225,324 | ) | | (225,324 | ) | | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Total |
$ | 650,000 | $ | (650,000 | ) | $ | | $ | (650,000 | ) | $ | | |||||||||||||
|
|
|
|
|
|
|
|
|
|
Reverse repurchase agreements
Reverse repurchase transactions are entered into by Optimum Fixed Income Fund under Master Repurchase Agreements (each, an MRA). MRA which permits the Fund, under certain circumstances, including an event of default (such as bankruptcy or insolvency), to offset payables and/or receivables under the MRA with collateral posted to the counterparty and create one single net payment due to or from the Fund. With reverse repurchase transactions, typically the Fund and the counterparties are permitted to sell, repledge, or use the collateral associated with the transaction. Bankruptcy or insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against such a right of offset in the event of the MRA counterpartys bankruptcy or insolvency. Pursuant to the terms of the MRA, the Fund posts securities as collateral with a market value in excess of the repurchase price to be paid or received by the Fund upon the maturity of the transaction. Upon a bankruptcy or insolvency of the MRA counterparty, the Fund is considered an unsecured creditor with respect to excess collateral and, as such, the return of excess collateral may be delayed.
(continues) | 161 |
Notes to financial statements
Optimum Fund Trust
8. Offsetting (continued)
As of March 31, 2017, the following table is a summary of Optimum Fixed Income Funds open reverse repurchase agreements by counterparty which are subject to offset under an MRA on a net basis:
Optimum Fixed Income Fund | |||||||||||||||||||||||||
Counterparty |
Reverse Repurchase Agreements |
Fair Value of Non-Cash Collateral Pledged |
Cash Collateral Pledged |
Net Collateral Pledged |
Net Exposure(b) | ||||||||||||||||||||
Merrill Lynch Pierce Fenner & Smith |
$ | (2,400,000 | ) | $ | 2,395,358 | $ | | $ | 2,395,358 | $ | (4,642 | ) |
In the event the counterparty of securities under an MRA files for bankruptcy or becomes insolvent, the Optimum Fixed Income Funds use of the proceeds of the agreement may be restricted while the other party, or its trustee or receiver, determines whether or not to enforce the Funds obligation to repurchase the securities.
Securities Lending
Securities lending transactions are entered into by Optimum International Fund under Master Securities Lending Agreements (each, an MSLA) which provide the right, in the event of default (including bankruptcy or insolvency), for the non-defaulting party to liquidate the collateral and calculate a net exposure to the defaulting party or request additional collateral. In the event that a borrower defaults, the Fund, as lender, would offset the market value of the collateral received against the market value of the securities loaned. When the value of the collateral is greater than that of the market value of the securities loaned, the lender is left with a net amount payable to the defaulting party. However, bankruptcy or insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against such a right of offset in the event of an MSLA counterpartys bankruptcy or insolvency. Under the MSLA, the borrower can resell or re-pledge the loaned securities, and the Fund can reinvest cash collateral, or, upon an event of default, resell or re-pledge the collateral.
As of March 31, 2017, the following table is a summary of Optimum International Funds securities lending agreements by counterparty which are subject to offset under an MSLA:
Counterparty |
Securities Loaned at Value |
Cash Collateral Received(a) |
Fair value of Non-Cash Collateral Received |
Net Exposure(b) | ||||||||||||||||
The Bank of New York Mellon |
$ | 26,639,200 | $ | (15,212,230 | ) | $ | (11,426,970 | ) | $ | |
(a)The value of the related collateral exceeded the value of the repurchase agreements and securities lending transactions as of March 31, 2017.
(b)Net exposure represents the receivable (payable) that would be due from (to) the counterparty in the event of default.
9. Securities Lending
Each Fund may lend its securities pursuant to a security lending agreement (Lending Agreement) with The Bank of New York Mellon (BNY Mellon). At the time a security is loaned, the borrower must post collateral equal to the required percentage of the market value of the loaned security, including any accrued interest. The required percentage is: (1) 102% with respect to U.S. securities and foreign securities that are denominated and payable in U.S. dollars; and (2) 105% with respect to foreign securities. With respect to each loan, if on any business day the aggregate market value of securities collateral plus cash collateral held is less than the aggregate market value of the securities that are the subject of such loan, the borrower will be notified to provide additional collateral by the end of the following business day, which, together with the collateral already held, will be not less than the applicable initial collateral requirements for such security loan. If the aggregate market value of securities collateral and cash collateral held with respect to a security loan exceeds the applicable initial collateral requirement, upon the request of the borrower, BNY Mellon must return enough collateral to the borrower by the end of the following business day to reduce the value of the remaining collateral to the applicable initial collateral requirement for such security loan. As a result of the foregoing, the value of the collateral held with respect to a loaned security on any particular day may be more or less than the value of the security on loan.
162
Cash collateral received by each Fund of the Trust is generally invested in a series of individual separate accounts, each corresponding to a Fund. The investment guidelines permit each separate account to hold certain securities that would be considered eligible securities for a money market fund. Cash collateral received is generally invested in government securities; certain obligations issued by government sponsored enterprises; repurchase agreements collateralized by U.S. Treasury securities; obligations issued by the central government of any Organization for Economic Cooperation and Development (OECD) country or its agencies, instrumentalities, or establishments; obligations of supranational organizations; commercial paper, notes, bonds, and other debt obligations; certificates of deposit, time deposits, and other bank obligations; and asset-backed securities as disclosed on the Schedules of investments. Securities purchased with cash collateral are valued at the market value. A Fund can also accept U.S. government securities and letters of credit (non-cash collateral) in connection with securities loans.
In the event of default or bankruptcy by the lending agent, realization and/or retention of the collateral may be subject to legal proceedings. In the event the borrower fails to return loaned securities and the collateral received is insufficient to cover the value of the loaned securities and provided such collateral shortfall is not the result of investment losses, the lending agent has agreed to pay the amount of the shortfall to the Funds or, at the discretion of the lending agent, replace the loaned securities. The Funds continue to record dividends or interest, as applicable, on the securities loaned and are subject to changes in value of the securities loaned that may occur during the term of the loan. The Funds have the right under the Lending Agreement to recover the securities from the borrower on demand. With respect to security loans collateralized by non-cash collateral, the Funds receive loan premiums paid by the borrower. With respect to security loans collateralized by cash collateral, the earnings from the collateral investments are shared among the Funds, the security lending agent, and the borrower. The Funds record security lending income net of allocations to the security lending agent and the borrower.
Each Fund may incur investment losses as a result of investing securities lending collateral. This could occur if an investment in the collateral investment account defaulted or became impaired. Under those circumstances, the value of a Funds cash collateral account may be less than the amount a Fund would be required to return to the borrowers of the securities and that Fund would be required to make up for this shortfall.
During the year ended March 31, 2017, Optimum Fixed Income Fund, Optimum Large Cap Growth Fund, Optimum Large Cap Value Fund, Optimum Small-Mid Cap Growth Fund, and Optimum Small-Mid Cap Value Fund had no securities on loan.
The following table reflects a breakdown of transactions accounted for as secured borrowings, the gross obligation by the type of collateral pledged, and the remaining contractual maturity of those transactions as of March 31, 2017 for the Optimum International Fund:
Securities Lending Transactions |
Overnight and Continuous |
Under 30 days |
Between 30 & 90 days |
Over 90 days |
Total | ||||||||||||||||||||
Common stock |
$ | 19,091,711 | $ | | $ | | $ | | $ | 19,091,711 |
10. Credit and Market Risk
Some countries in which the Funds may invest require governmental approval for the repatriation of investment income, capital, or the proceeds of sales of securities by foreign investors. In addition, if there is deterioration in a countrys balance of payments or for other reasons, a country may impose temporary restrictions on foreign capital remittances abroad.
The securities exchanges of certain foreign markets are substantially smaller, less liquid and more volatile than the major securities markets in the United States. Consequently, acquisition and disposition of securities by the Funds may be inhibited. In addition, a significant portion of the aggregate market value of securities listed on the major securities exchanges in emerging markets is held by a smaller number of investors. This may limit the number of shares available for acquisition or disposition by the Funds.
Optimum Fixed Income Fund invests in high yield fixed income securities, which are securities rated lower than BBB by S&P and lower than Baa3 by Moodys, or similarly rated by another nationally recognized statistical rating organization. Investments in these higher yielding securities are generally accompanied by a greater degree of credit risk than higher rated securities. Additionally, lower rated securities may be more susceptible to adverse economic and competitive industry conditions than investment grade securities.
Optimum Fixed Income Fund invests in bank loans and other securities that may subject it to direct indebtedness risk, the risk that the Fund will not receive payment of principal, interest and other amounts due in connection with these investments and will depend primarily on the financial condition of the borrower. Loans that are fully secured offer the Fund more protection than unsecured loans in the event of nonpayment of scheduled interest or principal, although there is no assurance that the liquidation of collateral from a secured loan would satisfy the corporate borrowers obligation, or that the collateral can be liquidated. Some loans or claims may be in default at the time of purchase. Certain of the loans and the other direct indebtedness acquired by the Fund may involve revolving credit facilities or other standby
(continues) | 163 |
Notes to financial statements
Optimum Fund Trust
financing commitments that obligate the Fund to pay additional cash on a certain date or on demand. These commitments may require the Fund to increase its investment in a company at a time when the Fund might not otherwise decide to do so (including at a time when the companys financial condition makes it unlikely that such amounts will be repaid). To the extent that the Fund is committed to advance additional funds, it will at all times hold and maintain cash or other high grade debt obligations in an amount sufficient to meet such commitments. As the Fund may be required to rely upon another lending institution to collect and pass on to the Fund amounts payable with respect to the loan and to enforce the Funds rights under the loan and other direct indebtedness, an insolvency, bankruptcy, or reorganization of the lending institution may delay or prevent the Fund from receiving such amounts. The highly leveraged nature of many loans may make them especially vulnerable to adverse changes in economic or market conditions. Investments in such loans and other direct indebtedness may involve additional risk to the Fund.
Optimum Fixed Income Fund invests in certain obligations that may have liquidity protection designed to ensure that the receipt of payments due on the underlying security is timely. Such protection may be provided through guarantees, insurance policies, or letters of credit obtained by the issuer or sponsor through third parties, through various means of structuring the transaction or through a combination of such approaches. The Fund will not pay any additional fees for such credit support, although the existence of credit support may increase the price of a security.
Optimum Fixed Income Fund invests in fixed income securities whose value is derived from an underlying pool of mortgages or consumer loans. The value of these securities is sensitive to changes in economic conditions, including delinquencies and/or defaults, and may be adversely affected by shifts in the markets perception of the issuers and changes in interest rates. Investors receive principal and interest payments as the underlying mortgages and consumer loans are paid back. Some of these securities are collateralized mortgage obligations (CMOs). CMOs are debt securities issued by U.S. government agencies or by financial institutions and other mortgage lenders, which are collateralized by a pool of mortgages held under an indenture. Prepayment of mortgages may shorten the stated maturity of the obligations and can result in a loss of premium, if any has been paid. Certain of these securities may be stripped (securities which provide only the principal or interest feature of the underlying security). The yield to maturity on an interest-only CMO is extremely sensitive not only to changes in prevailing interest rates, but also to the rate of principal payments (including prepayments) on the related underlying mortgage assets. A rapid rate of principal payments may have a material adverse effect on the Funds yield to maturity. If the underlying mortgage assets experience greater than anticipated prepayments of principal, the Fund may fail to fully recoup its initial investment in these securities even if the securities are rated in the highest rating categories.
Optimum Small-Mid Cap Growth Fund and Optimum Small-Mid Cap Value Fund invest a significant portion of their assets in small- and mid-sized companies. Investments in small- and mid-sized companies may be more volatile than investments in larger companies for a number of reasons, which include more limited financial resources or a dependence on narrow product lines.
Optimum Large Cap Growth Fund, Optimum Large Cap Value Fund, Optimum Small-Mid Cap Growth Fund, and Optimum Small-Mid Cap Value Fund may invest in REITs and are subject to the risks associated with that industry. If a Fund holds real estate directly as a result of defaults or receives rental income directly from real estate holdings, its tax status as a regulated investment company may be jeopardized. There were no direct real estate holdings during the year ended March 31, 2017. The Funds REIT holdings are also affected by interest rate changes, particularly if the REITs they hold use floating rate debt to finance their ongoing operations. The Funds also invests in real estate acquired as a result of ownership of securities or other instruments, including issuers that invest, deal, or otherwise engage in transactions in real estate or interests therein. These instruments may include interests in private equity limited partnerships or limited liability companies that hold real estate investments (Real Estate Limited Partnerships). The Funds will limit their investments in Real Estate Limited Partnerships to 5% of their total assets at the time of purchase.
Each Fund may invest up to 15% of its net assets in illiquid securities, which may include securities with contractual restrictions on resale, securities exempt from registration under Rule 144A promulgated under the Securities Act of 1933 (the Act), as amended, and other securities which may not be readily marketable. The Funds may also invest in securities exempt from registration under Section 4(a)(2) of the Act, which exempts from registration transactions by an issuer not involving any public offering. The relative illiquidity of these securities may impair the Funds from disposing of them in a timely manner and at a fair price when it is necessary or desirable to do so. While maintaining oversight, the Trusts Board has delegated to DMC, the day-to-day functions of determining whether individual securities are liquid for purposes of the Funds limitation on investments in illiquid securities. Securities eligible for resale pursuant to Rule 144A, which are determined to be liquid, are not subject to the Funds 15% limit on investments in illiquid securities. Rule 144A and restricted securities have been identified on the Schedules of investments.
164
11. Contractual Obligations
Each Fund enters into contracts in the normal course of business that contain a variety of indemnifications. Each Funds maximum exposure under these arrangements is unknown. However, each Fund has not had prior claims or losses pursuant to these contracts. Management has reviewed the Funds existing contracts and expects the risk of loss to be remote.
12. Recent Accounting Pronouncements
On Oct. 13, 2016, the Securities and Exchange Commission amended existing rules intended to modernize reporting and disclosure of information. These amendments relate to Regulation S-X which sets forth the form and content of financial statements. At this time, management is evaluating the implications of adopting these amendments and their impact on the financial statements and accompanying notes.
13. General Motors Term Loan Litigation
Optimum Fixed Income Fund received notice of a litigation proceeding related to a General Motors Corporation (G.M.) term loan participation previously held by the Fund in 2009. We believe the matter subject to the litigation notice will likely lead to a recovery from the Fund of certain amounts received by the Fund because a U.S. Court of Appeals has ruled that the Fund and similarly situated investors were unsecured creditors rather than secured lenders of G.M. as a result of an erroneous Uniform Commercial Code filing made by a third party. The Fund received the full principal on the loans in 2009 after the G.M. bankruptcy. However, based upon the court ruling the estate is seeking to recover such amounts arguing that, as unsecured creditors, the Fund should not have received payment in full. Based upon currently available information related to the litigation and the Funds potential exposure, the Fund recorded a liability of $1,385,788 and an asset of $415,736 based on the expected recoveries to unsecured creditors as of March 31, 2017 that resulted in a net decrease in the Funds NAV to reflect this likely recovery.
14. Subsequent Events
At a meeting held on Dec. 1415, 2016 (the Meeting), the Board approved an amended and restated fee schedule for the Investment Management Agreement between DMC and the Trust in connection with each of the Funds that became effective on April 1, 2017. In accordance with the terms of the amended and restated fee schedule for the Investment Management Agreement, DMC is entitled to receive an annual fee equal to the following percentage rates of the average daily net assets of each Fund beginning April 1, 2017:
Optimum Fixed Income Fund | 0.6000% of net assets up to $500 million | |
0.5500% of net assets from $500 million to $1 billion | ||
0.5000% of net assets from $1 billion to $1.5 billion | ||
0.4500% of net assets from $1.5 billion to $2 billion | ||
0.4250% of net assets from $2 billion to $2.5 billion | ||
0.4000% of net assets from $2.5 billion to $5 billion | ||
0.3750% of net assets over $5 billion | ||
Optimum International Fund | 0.7500% of net assets up to $500 million | |
0.7150% of net assets from $500 million to $1 billion | ||
0.7000% of net assets from $1 billion to $1.5 billion | ||
0.6750% of net assets from $1.5 billion to $2 billion | ||
0.6500% of net assets from $2 billion to $2.5 billion | ||
0.6000% of net assets over $2.5 billion | ||
Optimum Large Cap Growth Fund | 0.7500% of net assets up to $500 million | |
0.7000% of net assets from $500 million to $1 billion | ||
0.6500% of net assets from $1 billion to $1.5 billion | ||
0.6250% of net assets from $1.5 billion to $2 billion | ||
0.6000% of net assets from $2 billion to $2.5 billion | ||
0.5750% of net assets from $2.5 billion to $5 billion | ||
0.5500% of net assets over $5 billion |
(continues) | 165 |
Notes to financial statements
Optimum Fund Trust
14. Subsequent Events (continued)
Optimum Large Cap Value Fund | 0.7000% of net assets up to $500 million | |
0.6500% of net assets from $500 million to $1 billion | ||
0.6000% of net assets from $1 billion to $1.5 billion | ||
0.5750% of net assets from $1.5 billion to $2 billion | ||
0.5500% of net assets from $2 billion to $2.5 billion | ||
0.5250% of net assets from 2.5 billion to $5 billion | ||
0.5000% of net assets over $5 billion | ||
Optimum Small-Mid Cap Growth Fund | 1.1000% of net assets up to $250 million | |
1.0000% of net assets from $250 million to $500 million | ||
0.9000% of net assets from $500 million to $750 million | ||
0.8000% of net assets from $750 million to $1 billion | ||
0.7500% of net assets from $1 billion to $1.5 billion | ||
0.7000% of net assets over $1.5 billion | ||
Optimum Small-Mid Cap Value Fund | 1.0000% of net assets up to $250 million | |
0.9000% of net assets from $250 million to $500 million | ||
0.8000% of net assets from $500 million to $750 million | ||
0.7500% of net assets from $750 million to $1 billion | ||
0.7000% of net assets from $1 billion to $1.5 billion | ||
0.6500% of net assets over $1.5 billion |
In addition, at the Meeting the Board also approved an amended and restated fee schedule for the administrative, shareholder servicing, dividend disbursing and transfer agency services provided to the Funds by DIFSC under the Amended and Restated Mutual Fund Services Agreement between the Trust and DIFSC. The amended and restated fee schedule for these services became effective on April 1, 2017.
For these administrative services, effective April 1, 2017, the Trust pays DIFSC a fee at an annual rate (plus out-of-pocket expenses) of 0.0525% of assets up to $7.5 billion of the Trusts average daily net assets; 0.0475% of assets from $7.5 billion to $10 billion; 0.0425% of assets from $10 billion to $12 billion; 0.0375% of assets from $12 billion to $14 billion; and 0.0325% of assets over $14 billion.
For these shareholder servicing, dividend disbursing and transfer agency services, effective April 1, 2017, the Trust pays DIFSC a fee at an annual rate of 0.18% of the Trusts total average daily net assets, subject to certain minimums, plus out-of-pocket expenses.
Effective April 3, 2017, Delaware Investments® Family of Funds became Delaware FundsSM by Macquarie and Delaware Investments changed its name to Macquarie Investment Management (MIM). MIM is the marketing name for the companies comprising the asset management division of Macquarie Group Limited. Certain entities providing services to the Funds have also changed their names to reflect the use of the MIM name.
Management has determined that no other material events or transactions occurred subsequent to March 31, 2017 that would require recognition or disclosure in the Funds financial statements.
166
registered public accounting firm
To the Board of Trustees of Optimum Fund Trust and Shareholders of the Funds, as defined:
In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of Optimum Fixed Income Fund, Optimum International Fund, Optimum Large Cap Growth Fund, Optimum Large Cap Value Fund, Optimum Small-Mid Cap Growth Fund and Optimum Small-Mid Cap Value Fund (constituting Optimum Fund Trust, hereafter referred to as the Funds) as of March 31, 2017, the results of each of their operations for the year then ended, the changes in each of their net assets for each of the two years in the period then ended and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as financial statements) are the responsibility of the Funds management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities as of March 31, 2017 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Philadelphia, Pennsylvania
May 26, 2017
167 |
(Unaudited)
Optimum Fund Trust
Tax Information
The information set forth below is for each Funds fiscal year as required by federal income tax laws. Shareholders, however, must report distributions on a calendar year basis for income tax purposes, which may include distributions for portions of two fiscal years of the Funds. Accordingly, the information needed by shareholders for income tax purposes will be sent to them in January of each year. Please consult your tax advisor for proper treatment of this information.
All disclosures are based on financial information available as of the date of this annual report and, accordingly are subject to change. For any and all items requiring reporting, it is the intention of the Funds to report the maximum amount permitted under the Internal Revenue Code and the regulations thereunder.
For the fiscal year ended March 31, 2017, each Fund reports distributions paid during the year as follows:
(A) Long-Term Capital Gains Distributions (Tax Basis) |
(B) Ordinary Income Distributions* (Tax Basis) |
Total Distributions (Tax Basis) |
(C) Qualifying Dividends1 | |||||||||||||||||
Optimum Fixed Income Fund |
| 100.00 | % | 100.00 | % | 0.33 | % | |||||||||||||
Optimum International Fund |
| 100.00 | % | 100.00 | % | | ||||||||||||||
Optimum Large Cap Growth Fund |
100.00 | % | | 100.00 | % | | ||||||||||||||
Optimum Large Cap Value Fund |
89.52 | % | 10.48 | % | 100.00 | % | 100.00 | % | ||||||||||||
Optimum Small-Mid Cap Value Fund |
| 100.00 | % | 100.00 | % | 100.00 | % |
(A) and (B) are based on a percentage of each Funds total distributions.
(C) is based on a percentage of each Funds ordinary income distributions.
1Qualifying dividends represent dividends which qualify for the corporate dividends received deduction.
*For the fiscal year ended March 31, 2017, certain dividends paid by the Funds may be subject to a maximum tax rate of 20%. The percentage of dividends paid by the Funds from ordinary income reported as qualified income are as reported in the following table. Complete information will be computed and reported in conjunction with your 2017 Form 1099-DIV.
Optimum Fixed Income Fund |
Optimum International Fund |
Optimum Large Cap Growth Fund |
Optimum Large Cap Value Fund |
Optimum Small-Mid Cap Growth Fund |
Optimum Small-Mid Cap Value Fund | |||||||
0.37% |
100.00% | | 100.00% | | 100.00% |
Optimum International Fund intends to pass through foreign tax credits in the maximum amount of $793,429. The gross foreign source income earned during the fiscal year 2017 by the Fund was $14,850,429.
168 |
Board Consideration of Amended Fee Schedule for Investment Management Agreement for Optimum Fund Trust at a Meeting Held Dec. 1415, 2016
At a meeting held Dec. 1415, 2016 (the Meeting), the Board of Trustees (the Board or Trustees) of Optimum Fund Trust (the Trust), including a majority of non-interested or independent Trustees (the Independent Trustees), approved a fee restructuring proposal that lowered current investment management fees charged to the Funds by Delaware Management Company (DMC or Management) and lowered the administration and transfer agency fees charged to the Funds by DMCs affiliate. In particular, the Board approved an amended and restated fee schedule (the Amended Fee Schedule) for the Investment Management Agreement between DMC and the Trust on behalf of each of the six separate series within the Trust (each, a Fund or collectively, the Funds).
In reaching its decision with regard to the Amended Fee Schedule, the Board took into account information provided, and discussions held, in connection with the Investment Management Agreement renewal process undertaken by the Board that culminated in the renewal of DMCs Investment Management Agreement at the Boards September 2016 meeting (the September Renewal) and additional materials provided to the Board in regards to the Amended Fee Schedule proposal in connection with the Meeting.
In considering the Amended Fee Schedule, the Independent Trustees received assistance and advice from and met separately with independent counsel. In this regard, the Independent Trustees reviewed with independent counsel their legal duties and obligations in connection with the approval of the Amended Fee Schedule and discussed, in detail, the matters related to such approval. The materials prepared by Management specifically in connection with the approval of the Amended Fee Schedule were provided to the Independent Trustees in advance of the Meeting. While attention was given to all information furnished, the following discusses some primary factors relevant to the Boards decision. This discussion of the information and factors considered by the Board (as well as the discussion above) is not intended to be exhaustive, but rather summarizes certain factors considered by the Board. In view of the wide variety of factors considered, the Board did not, unless otherwise noted, find it practicable to quantify or otherwise assign relative weights to the following factors. In addition, individual Trustees may have assigned different weights to various factors.
Nature, extent, and quality of services. Following discussions in this regard and for reasons underlying the Boards decision in connection with the September Renewal, the Trustees were satisfied with the nature, extent and quality of the services provided by DMC to each of the Funds. In addition, the Board took into consideration Managements representation that there would be no change in the nature, quality and quantity of the services DMC provides to the Funds.
Investment performance. As noted in connection with the September Renewal, the Board was either satisfied with the overall investment performance of a Fund or the Board believed that DMC had taken appropriate steps to improve the performance of a Fund. The Funds and DMCs performance during the period between the September Renewal and the Meeting had not altered the Boards assessment of DMC in regards to investment performance.
Comparative expenses. In considering the appropriateness of the investment management fees charged to the Funds, the Board also reviewed and considered the investment management fees in light of the nature, extent and quality of the investment management services provided, and to be provided, by DMC. It was noted that at the September Renewal the Trustees considered various other products, portfolios and entities that are advised by DMC, as well as their relative fees and reasons for differences with respect thereto and any potential conflicts of interest. Attention was also given to an analysis of each Funds Institutional Class share expenses, including investment management fees, as compared to a group of other multi-advised institutional funds deemed comparable by Lipper Inc. (an independent third-party analyst and subsidiary of Broadridge Inc.), provided in connection with the September Renewal. It was noted that the Boards analysis in regards to these items had not materially changed from the September Renewal.
The Trustees noted that DMC was proposing fee concessions for the services provided for investment management. Materials were furnished to the Board ahead of the Meeting detailing these fee schedule changes and information on pro forma Fund expenses were also provided to the Board showing the expected impact of the Amended Fee Schedule on the Funds expense ratios. The Trustees also noted that DMC, since inception, had waived fees to the extent necessary to keep expenses of each Fund from exceeding a designated percentage of the applicable Funds average daily net assets, and that the Trustees had also previously discussed in detail the current cap on expenses in effect for each Fund through July 29, 2017. It was noted that DMC plans on continuing to utilize expense caps to strategically reduce a Funds total expenses after the Amended Fee Schedule goes into effect on April 1, 2017. While intending to continuously monitor the fee structure of each Fund, the Trustees found the revised expense structure of each Fund to be acceptable in view of the nature and structure of Fund operations and Managements cap on expenses.
(continues) | 169 |
Other Fund information
(Unaudited)
Optimum Fund Trust
Board Consideration of Amended Fee Schedule for Investment Management Agreement for Optimum Fund Trust at a Meeting Held Dec. 1415, 2016 (continued)
DMCs profitability; economies of scale. Based on the asset size of each Fund and the reimbursement and/or waiver of expenses by DMC, as well as the profitability information furnished to them by DMC, the Trustees did not believe that the level of profit being realized by DMC and its affiliates from services provided to any of the Funds was excessive. The profitability for DMC and its affiliates was provided both prior to the proposed fee restructuring and post-fee restructuring based on pro forma profitability reports. In connection with the September Renewal, the Board was also provided with information on potential fall-out benefits derived or to be derived by DMC and its affiliates in connection with their relationship to the Funds, such as the fees received for non-investment management services provided to the Funds by certain affiliates of DMC, soft dollar arrangements, and commissions paid to affiliated broker-dealers.
The Trustees recognized that as the Funds get larger at some point, economies of scale may result in DMC realizing a larger profit margin on management services provided to a Fund. The Trustees also noted that economies of scale are shared with a Fund and its shareholders through investment management fee breakpoints so that as a Fund grows in size, its effective investment management fee rate declines. After the implementation of the Amended Fee Schedule, the Board noted that each Funds fee schedule with DMC would have breakpoints and the last breakpoint for each Fund would be set at an asset level that is higher than each Funds current assets under management.
170 |
Board of trustees and officers addendum
Optimum Fund Trust
A mutual fund is governed by a Board of Trustees, which has oversight responsibility for the management of a funds business affairs. Trustees establish procedures and oversee and review the performance of the investment manager, the distributor and others that perform services for the fund. The independent fund trustees, in particular, are advocates for shareholder interests. The following is a list of the Trustees and Officers of the Trust with certain background and related information.
Name, Address, and Age |
Position(s) Held with Fund(s) |
Length of Time Served |
Principal Occupation(s) During Past 5 Years |
Number of Portfolios in Fund or Officer |
Other Directorships Held by Trustee or Officer | |||||
INTERESTED TRUSTEES | ||||||||||
Matt Audette2 2005 Market Street Philadelphia, PA 19103 |
Trustee | Dec.16, 2016 to present |
Chief Financial Officer and Managing Director LPL Financial LLC (2015-Present) |
6 | None | |||||
May 1974 |
||||||||||
Chief Financial Officer E*TRADE Financial Corporation (2011-2015) |
||||||||||
Shawn K. Lytle2,4 2005 Market Street Philadelphia, PA 19103 |
Trustee, President and Chief Executive Officer |
Trustee since Oct. 14, 2015; President and Chief |
Mr. Lytle has served as President of Delaware Investments3,4 |
6 | Trustee Delaware Investments® Family of Funds | |||||
Executive Officer | since June 2015 | (62 funds) | ||||||||
February 1970 |
since June 18, 2015 | and was the Regional Head | (September 2015-Present) | |||||||
of Americas for UBS Global | ||||||||||
Asset Management from 2010 through 2015.
|
||||||||||
INDEPENDENT TRUSTEES | ||||||||||
Robert J. Christian |
Chairman | Nov. 1, 2007 | Private Investor | 6 | Trustee FundVantage | |||||
2005 Market Street |
and Trustee | to present | (2006-Present) | Trust (34 mutual funds) | ||||||
Philadelphia, PA 19103 |
(2007-Present) | |||||||||
February 1949 |
||||||||||
Durant Adams Hunter | Trustee | July 17, 2003 | Managing Partner Ridgeway Partners | 6 | None | |||||
2005 Market Street |
to present | (Executive recruiting) | ||||||||
Philadelphia, PA 19103 |
(2004-Present) | |||||||||
November 1948 |
||||||||||
Pamela J. Moret |
Trustee | Oct. 1, 2013 | Private Investor | 6 | Director Blue Cross | |||||
2005 Market Street |
to present | (2015Present) | Blue Shield of Minnesota | |||||||
Philadelphia, PA 19103 |
(2014-Present) | |||||||||
Chief Executive Officer | ||||||||||
February 1956 |
brightpeak financial | |||||||||
(2011-June 2015) | ||||||||||
Senior Vice President | ||||||||||
Thrivent Financial for Lutherans | ||||||||||
(2002-2015) | ||||||||||
Stephen Paul Mullin |
Trustee | July 17, 2003 | President | 6 | Director Nasdaq | |||||
2005 Market Street |
to present | Econsult Solutions, Inc. | Futures, Inc. | |||||||
Philadelphia, PA 19103 |
(Economic Consulting) | (2007-Present) | ||||||||
(2013-Present) | ||||||||||
February 1956 |
||||||||||
Senior Vice President | ||||||||||
Econsult Corp. | ||||||||||
(Economic consulting) | ||||||||||
(2000-2012) |
(continues) | 171 |
Board of trustees and officers addendum
Optimum Fund Trust
Name, Address, and Age |
Position(s) Held with Fund(s) |
Length of Time Served |
Principal Occupation(s) During Past 5 Years |
Number of Portfolios in Fund or Officer |
Other Directorships Held by Trustee or Officer | |||||
INDEPENDENT TRUSTEES (continued) | ||||||||||
Robert A. Rudell 2005 Market Street Philadelphia, PA 19103 |
Trustee | July 17, 2003 to present |
Private Investor (2002-Present) |
6 | Director and Independent Chairman Heartland Funds | |||||
(3 mutual funds) | ||||||||||
September 1948 |
(2005-Present) | |||||||||
Jon Edward |
Trustee | July 17, 2003 | President H&S | 6 | None | |||||
Socolofsky |
to present | Enterprises of Minocqua, LLC | ||||||||
2005 Market Street |
(Commercial real estate developer) | |||||||||
Philadelphia, PA 19103 |
(2005-Present) | |||||||||
March 1946 |
Private Investor | |||||||||
(2002-Present) | ||||||||||
Susan M. Stalnecker |
Trustee | Dec. 14, 2016 | Private Investor | 6 | Trustee Duke University | |||||
2005 Market Street |
to present | (2016-Present) | Health System, Audit | |||||||
Philadelphia, PA 19103 |
Committee member | |||||||||
Vice President Productivity & Shared | (2010Present) | |||||||||
January 1953 |
Services E.I. du Pont de Nemours and |
|||||||||
Company (2012-2016) | Director Leidos | |||||||||
(2016-Present) | ||||||||||
Vice President and Treasurer | ||||||||||
E.I. du Pont de Nemours and | ||||||||||
Company (2006-2012) | ||||||||||
OFFICERS | ||||||||||
David F. Connor |
Senior Vice President, | Senior Vice President | David F. Connor has served in | 6 | None4 | |||||
2005 Market Street |
General Counsel, | since May 2013; | various capacities at | |||||||
Philadelphia, PA 19103 |
and Secretary | General Counsel | different times at | |||||||
since May 2015; | Delaware Investments3. | |||||||||
December 1963 |
Secretary since | |||||||||
Oct. 2005 | ||||||||||
Daniel V. Geatens |
Vice President | Sept. 20, 2007 | Daniel V. Geatens has served in | 6 | None4 | |||||
2005 Market Street |
and Treasurer | to present | various capacities at | |||||||
Philadelphia, PA 19103 |
different times at | |||||||||
Delaware Investments3. | ||||||||||
October 1972 |
||||||||||
Richard Salus |
Senior | Jan. 1, 2006 | Richard Salus has served in | 6 | None4 | |||||
2005 Market Street |
Vice President | to present | various executive capacities | |||||||
Philadelphia, PA 19103 |
and | at different times at | ||||||||
Chief Financial | Delaware Investments3. | |||||||||
October 1963 |
Officer |
1 | The term Fund Complex refers to the Funds in the Optimum Fund Trust. |
2 | Interested persons of the Funds by virtue of their executive and management positions or relationships with the Funds service providers or sub-service providers. |
3 | Delaware Investments is the marketing name for Delaware Management Holdings, Inc. and its subsidiaries, including the Trusts manager, principal underwriters, and transfer agent. |
4 | Messrs, Lytle, Connor, Geatens, and Salus also serve in similar capacities for the Delaware Investments® Family of Funds, a fund complex that has the same manager, principal underwriter, and transfer agent as the Trust. |
The Statement of Additional Information for the Funds includes additional information about the Trustees and Officers and is available, without charge, upon request by calling your financial advisor or 800 914-0278.
172 |
This annual report is for the information of Optimum Fund Trust shareholders, but it may be used with prospective investors when preceded or accompanied by a current prospectus for Optimum Fund Trust and the fact sheet for the most recently completed calendar quarter. The prospectus sets forth details about charges, expenses, investment objectives, and operating policies of the investment company. You should read the prospectus carefully before you invest. The figures in this report represent past results that are not a guarantee of future results. The return and principal value of an investment in the investment company will fluctuate so that shares, when redeemed, may be worth more or less than their original cost.
Board of trustees | Affiliated officers | Contact information | ||
Matt Audette | David F. Connor | Investment manager | ||
Chief Financial Officer and Managing Director LPL Financial LLC |
Senior Vice President, General Counsel, and Secretary Optimum Fund Trust Philadelphia, PA |
Delaware Management Company, a series of Delaware Management Business Trust Philadelphia, PA | ||
Shawn K. Lytle
President Delaware Investments Philadelphia, PA
Robert J. Christian
Private Investor
Durant Adams Hunter
Managing Partner Ridgeway Partners
Pamela J. Moret
Private Investor
Stephen Paul Mullin
President Econsult Solutions, Inc.
Robert A. Rudell
Private Investor
Jon Edward Socolofsky
Private Investor
Susan M. Stalnecker
Private Investor |
Daniel V. Geatens
Vice President and Treasurer Optimum Fund Trust Philadelphia, PA
Richard Salus
Senior Vice President and Chief Financial Officer Optimum Fund Trust Philadelphia, PA |
National distributor
Delaware Distributors, L.P.
Shareholder servicing, dividend disbursing, and transfer agent
Delaware Investments Fund Services Company 2005 Market Street Philadelphia, PA 19103-7094
For shareholders
800 914-0278
For securities dealers and financial institutions representatives only
800 362-7500
Website
optimummutualfunds.com |
Each Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year on Forms N-Q. Each Funds Forms N-Q, as well as a description of the policies and procedures that the Funds use to determine how to vote proxies (if any) relating to portfolio securities and the Schedules of Investments included in the Funds most recent Forms N-Q are available without charge (i) upon request, by calling 800 914-0278; (ii) on the Funds website at optimummutualfunds.com/literature; and (iii) on the SECs website at sec.gov. Each Funds Forms N-Q may be reviewed and copied at the SECs Public Reference Room in Washington, D.C.; information on the operation of the Public Reference Room may be obtained by calling 800 SEC-0330.
Information (if any) regarding how the Funds voted proxies relating to portfolio securities during the most recently disclosed 12-month period ended June 30 is available without charge (i) through the Funds website at optimummutualfunds.com/proxy; and (ii) on the SECs website at sec.gov.
173 |
Item 2. Code of Ethics
The registrant has adopted a code of ethics that applies to the registrants principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party. A copy of the registrants Code of Business Ethics has been posted on the Optimum Mutual Funds Internet Web site at www.optimummutualfunds.com. Any amendments to the Code of Business Ethics, and information on any waiver from its provisions granted by the registrant, will also be posted on this Web site within five business days of such amendment or waiver and will remain on the Web site for at least 12 months.
Item 3. Audit Committee Financial Expert
The registrants Board of Trustees/Directors has determined that certain members of the registrants Audit Committee are audit committee financial experts, as defined below. For purposes of this item, an audit committee financial expert is a person who has the following attributes:
a. An understanding of generally accepted accounting principles and financial statements;
b. The ability to assess the general application of such principles in connection with the accounting for estimates, accruals, and reserves;
c. Experience preparing, auditing, analyzing, or evaluating financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by the registrants financial statements, or experience actively supervising one or more persons engaged in such activities;
d. An understanding of internal controls and procedures for financial reporting; and
e. An understanding of audit committee functions.
An audit committee financial expert shall have acquired such attributes through:
a. Education and experience as a principal financial officer, principal accounting officer, controller, public accountant, or auditor or experience in one or more positions that involve the performance of similar functions;
b. Experience actively supervising a principal financial officer, principal accounting officer, controller, public accountant, auditor, or person performing similar functions;
c. Experience overseeing or assessing the performance of companies or public accountants with respect to the preparation, auditing, or evaluation of financial statements; or
d. Other relevant experience.
The registrants Board of Trustees/Directors has also determined that each member of the registrants Audit Committee is independent. In order to be independent for purposes of this item, the Audit Committee member may not: (i) other than in his or her capacity as a member of the Board of Trustees/Directors or any committee thereof, accept directly or indirectly any consulting, advisory or other compensatory fee from the issuer; or (ii) be an interested person of the registrant as defined in Section 2(a)(19) of the Investment Company Act of 1940.
The names of the audit committee financial experts on the registrants Audit Committee are set forth below:
Robert J. Christian | |
Robert A. Rudell | |
Jon E. Socolofsky |
Item 4. Principal Accountant Fees and Services
PricewaterhouseCoopers LLP (PwC), the Independent Accountant to the series portfolios of Optimum Fund Trust (Funds), has advised the Audit Committee of the Board of Trustees of the Funds (Audit Committee) that, as of the date of the filing of this Annual Report on Form N-CSR, it is in discussions with the staff of the Securities and Exchange Commission (SEC Staff), or the SEC, regarding the interpretation and application of Rule 2-01(c)(1)(ii)(A) of Regulation S-X, or the Loan Rule.
The Loan Rule prohibits accounting firms, such as PwC, from having certain financial relationships with their audit clients and affiliated entities. Specifically, the Loan Rule provides, in relevant part, that an accounting firm generally would not be independent if it receives a loan from a lender that is a record or beneficial owner of more than ten percent of the audit clients equity securities. Under the SEC Staffs interpretation of the Loan Rule, based on information provided to us by PwC, some of PwCs relationships with its lenders who also own shares of one or more funds within the Delaware FundsSM by Macquarie investment company complex (which includes the Funds) implicate the Loan Rule, calling into question PwCs independence with respect to the Funds. PwC believes that, in light of the facts of these lending relationships, its ability to exercise objective judgment with respect to the audit of the Funds has not been impaired.
The Audit Committee has considered the lending relationships described by PwC and has concluded that (1) the lending relationships did not affect PwCs application of objective judgment in conducting its audits and issuing reports on the Funds financial statements; and (2) a reasonable investor with knowledge of the lending relationships described by PwC would reach the same conclusion. In making this determination, the Audit Committee considered, among other things, PwCs description of the relevant lending relationships and PwCs representation that its objectivity was not impaired in conducting its audit of the Funds financial statements. In connection with this determination, PwC advised the Audit Committee that it believes PwC is independent and it continues to have discussions with the SEC Staff.
If the SEC were ultimately to determine that PwC was not independent with respect to the Funds for certain time periods, the Funds filings with the SEC that contain the Funds financial statements for such periods would be non-compliant with the applicable securities laws. If the SEC determines that PwC was not independent, among other things, the Funds could be required to have independent audits conducted on the Funds previously audited financial statements by another registered public accounting firm for the affected periods. The time involved to conduct such independent audits may impair the Funds ability to issue shares. Any of the foregoing possible outcomes potentially could have a material adverse effect on the Funds.
(a) Audit fees.
The aggregate fees billed for services provided to the registrant by its independent auditors for the audit of the registrants annual financial statements and for services normally provided by the independent auditors in connection with statutory and regulatory filings or engagements were $153,000 for the fiscal year ended March 31, 2017.
The aggregate fees billed for services provided to the registrant by its independent auditors for the audit of the registrants annual financial statements and for services normally provided by the independent auditors in connection with statutory and regulatory filings or engagements were $148,500 for the fiscal year ended March 31, 2016.
(b) Audit-related fees.
The aggregate fees billed by the registrants independent auditors for services relating to the performance of the audit of the registrants financial statements and not reported under paragraph (a) of this Item were $0 for the fiscal year ended March 31, 2017.
The aggregate fees billed by the registrants independent auditors for services relating to the performance of the audit of the financial statements of the registrants investment adviser and other service providers under common control with the adviser and that relate directly to the operations or financial reporting of the registrant were $640,000 for the registrants fiscal year ended March 31, 2017. The percentage of these fees relating to services approved by the registrants Audit Committee pursuant to the de minimis exception from the pre-approval requirement in Rule 2-01(c)(7)(i)(C) of Regulation S-X was 0%. These audit-related services were as follows: year-end audit procedures; group reporting and subsidiary statutory audits.
The aggregate fees billed by the registrants independent auditors for services relating to the performance of the audit of the registrants financial statements and not reported under paragraph (a) of this Item were $0 for the fiscal year ended March 31, 2016.
The aggregate fees billed by the registrants independent auditors for services relating to the performance of the audit of the financial statements of the registrants investment adviser and other service providers under common control with the adviser and that relate directly to the operations or financial reporting of the registrant were $667,000 for the registrants fiscal year ended March 31, 2016. The percentage of these fees relating to services approved by the registrants Audit Committee pursuant to the de minimis exception from the pre-approval requirement in Rule 2-01(c)(7)(i)(C) of Regulation S-X was 0%. These audit-related services were as follows: year end audit procedures; group reporting and subsidiary statutory audits.
(c) Tax fees.
The aggregate fees billed by the registrants independent auditors for tax-related services provided to the registrant were $29,175 for the fiscal year ended March 31, 2017. The percentage of these fees relating to services approved by the registrants Audit Committee pursuant to the de minimis exception from the pre-approval requirement in Rule 2-01(c)(7)(i)(C) of Regulation S-X was 0%. These tax-related services were as follows: review of income tax returns and review of annual excise distribution calculations.
The aggregate fees billed by the registrants independent auditors for tax-related services provided to the registrants investment adviser and other service providers under common control with the adviser and that relate directly to the operations or financial reporting of the registrant were $0 for the registrants fiscal year ended March 31, 2017.
The aggregate fees billed by the registrants independent auditors for tax-related services provided to the registrant were $29,175 for the fiscal year ended March 31, 2016. The percentage of these fees relating to services approved by the registrants Audit Committee pursuant to the de minimis exception from the pre-approval requirement in Rule 2-01(c)(7)(i)(C) of Regulation S-X was 0%. These tax-related services were as follows: review of income tax returns and review of annual excise distribution calculations.
The aggregate fees billed by the registrants independent auditors for tax-related services provided to the registrants investment adviser and other service providers under common control with the adviser and that relate directly to the operations or financial reporting of the registrant were $0 for the registrants fiscal year ended March 31, 2016.
(d) All other fees.
The aggregate fees billed for all services provided by the independent auditors to the registrant other than those set forth in paragraphs (a), (b) and (c) of this Item were $0 for the fiscal year ended March 31, 2017.
The aggregate fees billed for all services other than those set forth in paragraphs (b) and (c) of this Item provided by the registrants independent auditors to the registrants adviser and other service providers under common control with the adviser and that relate directly to the operations or financial reporting of the registrant were $0 for the registrants fiscal year ended March 31, 2017. The percentage of these fees relating to services approved by the registrants Audit Committee pursuant to the de minimis exception from the pre-approval requirement in Rule 2-01(c)(7)(i)(C) of Regulation S-X was 0%.
The aggregate fees billed for all services provided by the independent auditors to the registrant other than those set forth in paragraphs (a), (b) and (c) of this Item were $0 for the fiscal year ended March 31, 2016.
The aggregate fees billed for all services other than those set forth in paragraphs (b) and (c) of this Item provided by the registrants independent auditors to the registrants adviser and other service providers under common control with the adviser and that relate directly to the operations or financial reporting of the registrant were $0 for the registrants fiscal year ended March 31, 2016. The percentage of these fees relating to services approved by the registrants Audit Committee pursuant to the de minimis exception from the pre-approval requirement in Rule 2-01(c)(7)(i)(C) of Regulation S-X was 0%.
(e) The registrants Audit Committee has established pre-approval policies and procedures as permitted by Rule 2-01(c)(7)(i)(B) of Regulation S-X (the Pre-Approval Policy) with respect to services provided by the registrants independent auditors. Pursuant to the Pre-Approval Policy, the Audit Committee has pre-approved the services set forth in the table below with respect to the registrant up to the specified fee limits. Certain fee limits are based on aggregate fees to the registrant and other registrants within the Optimum Fund Trust.
Service | Range of Fees |
Audit Services | |
Statutory audits or financial audits for new Funds |
up to $25,000 per Fund |
Services associated with SEC registration statements (e.g., Form N-1A, Form N-14, etc.), periodic reports and other documents filed with the SEC or other documents issued in connection with securities offerings (e.g., comfort letters for closed-end Fund offerings, consents), and assistance in responding to SEC comment letters |
up to $10,000 per Fund |
Consultations by Fund management as to the accounting or disclosure treatment of transactions or events and/or the actual or potential impact of final or proposed rules, standards or interpretations by the SEC, FASB, or other regulatory or standard-setting bodies (Note: Under SEC rules, some consultations may be considered audit-related services rather than audit services) |
up to $25,000 in the aggregate |
Audit-Related Services |
|
Consultations by Fund management as to the accounting or disclosure treatment of transactions or events and /or the actual or potential impact of final or proposed rules, standards or interpretations by the SEC, FASB, or other regulatory or standard-setting bodies (Note: Under SEC rules, some consultations may be considered audit services rather than audit-related services) |
up to $25,000 in the aggregate |
Tax Services |
|
U.S. federal, state and local and international tax planning and advice (e.g., consulting on statutory, regulatory or administrative developments, evaluation of Funds tax compliance function, etc.) |
up to $25,000 in the aggregate |
U.S. federal, state and local tax compliance (e.g., excise distribution reviews, etc.) |
up to $5,000 per Fund |
Review of federal, state, local and international income, franchise and other tax returns |
up to $5,000 per Fund |
Under the Pre-Approval Policy, the Audit Committee has also pre-approved the services set forth in the table below with respect to the registrants investment adviser and other entities controlling, controlled by or under common control with the investment adviser that provide ongoing services to the registrant (the Control Affiliates) up to the specified fee limit. This fee limit is based on aggregate fees to the investment adviser and its Control Affiliates.
Service | Range of Fees |
Non-Audit Services | |
Services associated with periodic reports and other documents filed with the SEC and assistance in responding to SEC comment letters | up to $10,000 in the aggregate |
The Pre-Approval Policy requires the registrants independent auditors to report to the Audit Committee at each of its regular meetings regarding all services initiated since the last such report was rendered, including those services authorized by the Pre-Approval Policy.
(f) Not applicable.
(g) The aggregate non-audit fees billed by the registrants independent auditors for services rendered to the registrant and to its investment adviser and other service providers under common control with the adviser were $11,180,000 and $10,036,000 for the registrants fiscal years ended March 31, 2017 and March 31, 2016, respectively.
(h) In connection with its selection of the independent auditors, the registrants Audit Committee has considered the independent auditors provision of non-audit services to the registrants investment adviser and other service providers under common control with the adviser that were not required to be pre-approved pursuant to Rule 2-01(c)(7)(ii) of Regulation S-X. The Audit Committee has determined that the independent auditors provision of these services is compatible with maintaining the auditors independence.
Item 5. Audit Committee of Listed Registrants
Not applicable.
Item 6. Investments
(a) Included as part of report to shareholders filed under Item 1 of this Form N-CSR.
(b) Divestment of securities in accordance with Section 13(c) of the Investment Company Act of 1940.
Not applicable.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies
Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies
Not applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders
Not applicable.
Item 11. Controls and Procedures
The registrants principal executive officer and principal financial officer have evaluated the registrants disclosure controls and procedures within 90 days of the filing of this report and have concluded that they are effective in providing reasonable assurance that the information required to be disclosed by the registrant in its reports or statements filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission.
There were no significant changes in the registrants internal control over financial reporting that occurred during the second fiscal quarter of the period covered by the report to stockholders included herein (i.e., the registrants fourth fiscal quarter) that have materially affected, or are reasonably likely to materially affect, the registrants internal control over financial reporting.
Item 12. Exhibits
(a) (1) Code of Ethics
Not applicable.
(2) Certifications of Principal Executive Officer and Principal Financial Officer pursuant to Rule 30a-2 under the Investment Company Act of 1940 are attached hereto as Exhibit 99.CERT.
(3) Written solicitations to purchase securities pursuant to Rule 23c-1 under the Securities Exchange Act of 1934.
Not applicable.
(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 are furnished herewith as Exhibit 99.906CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf, by the undersigned, thereunto duly authorized.
OPTIMUM FUND TRUST
/s/ SHAWN LYTLE | |
By: | Shawn Lytle |
Title: | President and Chief Executive Officer |
Date: | June 6, 2017 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
/s/ SHAWN LYTLE | |
By: | Shawn Lytle |
Title: | President and Chief Executive Officer |
Date: | June 6, 2017 |
/s/ RICHARD SALUS | |
By: | Richard Salus |
Title: | Chief Financial Officer |
Date: | June 6, 2017 |
EXHIBIT 99.CERT
CERTIFICATION
I, Shawn Lytle, certify that:
1. | I have reviewed this report on Form N-CSR of Optimum Fund Trust; | |||
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |||
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; | |||
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: | |||
(a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |||
(b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |||
(c) | evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and | |||
(d) | disclosed in this report any change in the registrants internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and | |||
5. | The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): | |||
(a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and | |||
(b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: June 6, 2017
/s/ SHAWN LYTLE | |
By: | Shawn Lytle |
Title: | President and Chief Executive Officer |
CERTIFICATION
I, Richard Salus, certify that:
1. | I have reviewed this report on Form N-CSR of Optimum Fund Trust; | |||
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |||
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; | |||
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: | |||
(a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |||
(b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |||
(c) | evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and | |||
(d) | disclosed in this report any change in the registrants internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and | |||
5. | The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): | |||
(a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and | |||
(b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: June 6, 2017
/s/ RICHARD SALUS | |
By: | Richard Salus |
Title: | Chief Financial Officer |
EXHIBIT 99.906CERT
Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
In connection with the attached report of the registrant on Form N-CSR to be filed with the Securities and Exchange Commission (the Report), each of the undersigned officers of the registrant does hereby certify, to the best of such officers knowledge, that:
1. | The Report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934; and | |
2. | The information contained in the Report fairly represents, in all material respects, the financial condition and results of operations of the registrant as of, and for, the periods presented in the Report. |
Date: June 6, 2017
/s/ SHAWN LYTLE | |
By: | Shawn Lytle |
Title: | President and Chief Executive Officer |
/s/ RICHARD SALUS | |
By: | Richard Salus |
Title: | Chief Financial Officer |
A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act, or other document authenticating, acknowledging, or otherwise adopting the signatures that appear in typed form within the electronic version of this written statement required by Section 906, has been provided to the registrant and will be retained by the registrant and furnished to the SEC or its staff upon request.
*=)\'Z9:ZMK3SQV=WXB\'^%H&MX&N)#JWCCQ;HG@G0$:-2"L#Z
M[X@TY)9.D<;O(>$-'Z!^AT= !0!%-/#;1M-<3100QC<\LTB11HHZEGWW[?GBOP]\.+.
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M\@_X6OX\_P"C9?C?_P"#_P#9N_\ H@Z LNZ_'_(/^%K^//\ HV7XW_\ @_\
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M *-E^-__ (/_ -F[_P"B#H"R[K\?\@_X6OX\_P"C9?C?_P"#_P#9N_\ H@Z
MLNZ_'_(/^%K^//\ HV7XW_\ @_\ V;O_ *(.@++NOQ_R#_A:_CS_ *-E^-__
M (/_ -F[_P"B#H"R[K\?\@_X6OX\_P"C9?C?_P"#_P#9N_\ H@Z LNZ_'_(/
M^%K^//\ HV7XW_\ @_\ V;O_ *(.@++NOQ_R#_A:_CS_ *-E^-__ (/_ -F[
M_P"B#H"R[K\?\@_X6OX\_P"C9?C?_P"#_P#9N_\ H@Z LNZ_'_(/^%K^//\
MHV7XW_\ @_\ V;O_ *(.@++NOQ_R#_A:_CS_ *-E^-__ (/_ -F[_P"B#H"R
M[K\?\@_X6OX\_P"C9?C?_P"#_P#9N_\ H@Z LNZ_'_(/^%K^//\ HV7XW_\
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M_CS_ *-E^-__ (/_ -F[_P"B#H"R[K\?\@_X6OX\_P"C9?C?_P"#_P#9N_\
MH@Z LNZ_'_(/^%K^//\ HV7XW_\ @_\ V;O_ *(.@++NOQ_R#_A:_CS_ *-E
M^-__ (/_ -F[_P"B#H"R[K\?\@_X6OX\_P"C9?C?_P"#_P#9N_\ H@Z LNZ_
M'_(/^%K^//\ HV7XW_\ @_\ V;O_ *(.@++NOQ_R-OPW\0O%NN:U9:7J?P+^
M*G@VQNOM'G^)/$FK_!*ZT73?(M)[B+[9!X0^,6N:L_VB:&.UC^R:7=8ENHC+
MY4 EFA-@M;KMZ_Y'JE @H * "@ H * "@ H * "@ H * "@ H * "@"EJ5I-
M>Z?>V-OJ-[I$]W:7%M#JFG+8OJ&G2S1-''?62:G97EFUU"S"2,75I;G2H./MX4_:R33G[.C[2G2E7E"+
MBY0A.K!6YH*