N-Q 1 algerfunds_nq.htm algerfunds_nq.htm - Generated by SEC Publisher for SEC Filing

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number 811-1355

The Alger Funds

__________________________________________________________________
(Exact name of registrant as specified in charter)

360 Park Avenue South, New York, New York 10010

__________________________________________________________________
(Address of principal executive offices) (Zip code)

Mr. Hal Liebes

Fred Alger Management, Inc.

360 Park Avenue South

New York, New York 10010

__________________________________________________________________
(Name and address of agent for service)

Registrant's telephone number, including area code: 212-806-8800

Date of fiscal year end: October 31

Date of reporting period: July 31, 2017

 

ITEM 1. Schedule of Investments.

- 2 -

 

THE ALGER FUNDS | ALGER CAPITAL APPRECIATION FUND
Schedule of Investments July 31, 2017 (Unaudited)

COMMON STOCKS—95.3%   SHARES       VALUE
AEROSPACE & DEFENSE—0.4%            
General Dynamics Corp. 54,154 $ 10,632,055
APPAREL ACCESSORIES & LUXURY GOODS—0.7%            
PVH Corp. 151,927   18,123,372
APPLICATION SOFTWARE—4.3%            
Adobe Systems, Inc. * 204,825     30,004,814
Autodesk, Inc. * 353,919     39,210,686
salesforce. com, Inc. * 516,827     46,927,892
        116,143,392
AUTO PARTS & EQUIPMENT—0.5%            
Delphi Automotive PLC. 144,942   13,105,656
BIOTECHNOLOGY—5.7%            
ACADIA Pharmaceuticals, Inc. * 160,848     4,788,445
Alexion Pharmaceuticals, Inc. * 16,109     2,212,410
BioMarin Pharmaceutical, Inc. * 131,700     11,554,041
Celgene Corp. * 402,624     54,519,316
Clovis Oncology, Inc. * 94,663     8,028,369
Exact Sciences Corp. * 354,687     13,761,855
Incyte Corp. * 131,072     17,470,587
Sarepta Therapeutics, Inc. * 105,046     4,052,675
TESARO, Inc. * 33,329     4,254,780
Vertex Pharmaceuticals, Inc. * 220,405     33,461,887
        154,104,365
BREWERS—0.4%            
Molson Coors Brewing Co. , Cl. B 123,158   10,958,599
BROADCASTING—1.6%            
CBS Corp. , Cl. B 658,068   43,320,616
BUILDING PRODUCTS—0.4%            
Johnson Controls International PLC. 306,126     11,923,608
CABLE & SATELLITE—2.0%            
Charter Communications, Inc. , Cl. A* 23,418     9,177,748
Comcast Corporation, Cl. A 1,117,295     45,194,583
        54,372,331
CONSTRUCTION MATERIALS—0.2%            
Vulcan Materials Co. 41,589     5,120,438
CONSUMER FINANCE—0.2%            
LendingClub Corp. * 1,140,324     5,781,443
DATA PROCESSING & OUTSOURCED SERVICES—3.9%            
Visa, Inc. , Cl. A 1,059,763   105,510,004
DIVERSIFIED BANKS—0.5%            
JPMorgan Chase & Co. 159,733   14,663,489
DIVERSIFIED CHEMICALS—0.4%            
EI Du Pont de Nemours & Co. 118,376     9,731,691
ELECTRICAL COMPONENTS & EQUIPMENT—0.2%            
Rockwell Automation, Inc. 24,763     4,086,638
FINANCIAL EXCHANGES & DATA—1.9%            
IntercontinentalExchange Group, Inc. 580,218     38,706,343
S&P Global, Inc. 80,846     12,417,137
        51,123,480

 

- 3 -

 

THE ALGER FUNDS | ALGER CAPITAL APPRECIATION FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES       VALUE
FOOD DISTRIBUTORS—0.4%            
Performance Food Group Co. * 329,628 $ 9,493,286
FOOTWEAR—0.2%            
NIKE, Inc. , Cl. B 112,173     6,623,816
HEALTH CARE EQUIPMENT—2.7%            
Boston Scientific Corp. * 610,160     16,242,459
Danaher Corp. 250,905     20,446,248
DexCom, Inc. * 132,619     8,833,752
Edwards Lifesciences Corp. * 75,139     8,654,510
Medtronic PLC. 217,983     18,304,033
        72,481,002
HEALTH CARE SERVICES—0.1%            
Envision Healthcare Corp. * 36,371     2,052,416
HOME ENTERTAINMENT SOFTWARE—1.0%            
Electronic Arts, Inc. * 230,106   26,862,574
HOME IMPROVEMENT RETAIL—1.6%            
The Home Depot, Inc. 287,686   43,037,826
HOTELS RESORTS & CRUISE LINES—0.1%            
Marriott International, Inc. , Cl. A 26,299     2,740,093
HOUSEWARES & SPECIALTIES—1.0%            
Newell Brands, Inc. 486,389   25,642,428
HYPERMARKETS & SUPER CENTERS—0.4%            
Wal-Mart Stores, Inc. 150,978   12,076,730
INDUSTRIAL CONGLOMERATES—2.9%            
Honeywell International, Inc. 570,266   77,624,608
INDUSTRIAL GASES—0.9%            
Air Products & Chemicals, Inc. 161,577   22,968,171
INDUSTRIAL MACHINERY—0.7%            
Stanley Black & Decker, Inc. 127,940   17,999,879
INTERNET RETAIL—8.2%            
Amazon. com, Inc. * 181,333   179,117,111
Expedia, Inc. 106,089     16,599,746
NetFlix, Inc. * 141,948     25,786,273
        221,503,130
INTERNET SOFTWARE & SERVICES—13.4%            
Alibaba Group Holding Ltd. #* 430,373     66,686,296
Alphabet, Inc. , Cl. C* 152,530   141,929,165
Altaba, Inc. * 215,480     12,584,032
Facebook, Inc. , Cl. A* 807,971   136,749,092
Match Group, Inc. * 132,696     2,421,702
Palantir Technologies, Inc. , Cl. A*,@ 153,282     931,955
        361,302,242
INVESTMENT BANKING & BROKERAGE—0.9%            
Morgan Stanley 510,511   23,942,966
IT CONSULTING & OTHER SERVICES—0.7%            
Cognizant Technology Solutions Corp. , Cl. A 282,397   19,575,760
LEISURE FACILITIES—0.6%            
Vail Resorts, Inc. 80,741   17,016,973

 

- 4 -

 

THE ALGER FUNDS | ALGER CAPITAL APPRECIATION FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES       VALUE
LIFE SCIENCES TOOLS & SERVICES—0.6%            
Illumina, Inc. * 95,417 $ 16,588,245
MANAGED HEALTH CARE—4.8%            
Aetna, Inc. 233,446     36,023,052
Cigna Corp. 68,882     11,955,160
Humana, Inc. 62,325     14,409,540
UnitedHealth Group, Inc. 356,864     68,450,084
        130,837,836
MOVIES & ENTERTAINMENT—0.8%            
The Walt Disney Co. 50,804     5,584,883
Time Warner, Inc. 148,759     15,235,897
        20,820,780
OIL & GAS EQUIPMENT & SERVICES—0.6%            
Halliburton Company 350,271   14,865,501
OIL & GAS EXPLORATION & PRODUCTION—1.2%            
Anadarko Petroleum Corp. 207,829     9,491,550
Pioneer Natural Resources Co. 144,536     23,573,822
        33,065,372
OTHER DIVERSIFIED FINANCIAL SERVICES—1.0%            
Bank of America Corp. 1,122,557   27,076,075
PERSONAL PRODUCTS—0.6%            
The Estee Lauder Companies, Inc. , Cl. A 153,523   15,197,242
PHARMACEUTICALS—0.9%            
Allergan PLC. 64,605     16,301,779
Bristol-Myers Squibb Co. 130,262     7,411,908
        23,713,687
RAILROADS—0.5%            
Union Pacific Corp. 142,574   14,679,419
RESTAURANTS—1.2%            
McDonald's Corp. 203,538   31,576,885
SEMICONDUCTOR EQUIPMENT—0.9%            
Applied Materials, Inc. 550,623   24,398,105
SEMICONDUCTORS—5.2%            
Broadcom Ltd. 299,582     73,894,896
Cavium Networks, Inc. * 162,698     10,077,514
Microchip Technology, Inc. 428,628     34,307,385
Micron Technology, Inc. * 570,092     16,030,987
NVIDIA Corp. 39,026     6,342,116
        140,652,898
SOFT DRINKS—0.5%            
PepsiCo, Inc. 125,104   14,588,377
SPECIALTY CHEMICALS—0.4%            
The Sherwin-Williams Co. 33,732     11,376,792
SYSTEMS SOFTWARE—7.3%            
Choicestream, Inc. *,@,(a) 82,955     –
Microsoft Corp. 2,242,950   163,062,465
Oracle Corp. 286,649     14,312,385
Red Hat, Inc. * 64,197     6,347,157

 

- 5 -

 

THE ALGER FUNDS | ALGER CAPITAL APPRECIATION FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES         VALUE
SYSTEMS SOFTWARE—(CONT. )              
ServiceNow, Inc. * 131,391 $   14,512,136
        198,234,143
TECHNOLOGY HARDWARE STORAGE & PERIPHERALS—7.6%              
Apple, Inc. 1,164,931   173,260,187
Western Digital Corp. 384,314       32,712,808
        205,972,995
TOBACCO—0.8%              
Philip Morris International, Inc. 193,007   22,525,847
TRADING COMPANIES & DISTRIBUTORS—0.8%              
HD Supply Holdings, Inc. * 453,993       14,750,232
United Rentals, Inc. * 56,759       6,752,051
        21,502,283
WIRELESS TELECOMMUNICATION SERVICES—0.5%              
T-Mobile US, Inc. * 203,182   12,528,202
TOTAL COMMON STOCKS              
(Cost $1,956,165,909)         2,571,845,761
PREFERRED STOCKS—0.3%   SHARES         VALUE
INTERNET SOFTWARE & SERVICES—0.1%              
Palantir Technologies, Inc. , Cl. B*,@ 625,130       3,800,790
Palantir Technologies, Inc. , Cl. D*,@ 81,445       495,186
            4,295,976
PHARMACEUTICALS—0.2%              
Intarcia Therapeutics, Inc. , Series DD*,@ 76,682       4,503,534
SYSTEMS SOFTWARE—–%              
Choicestream, Inc. , Cl. A*,@,(a) 715,332       –
Choicestream, Inc. , Cl. B*,@,(a) 1,649,956       –
            –
TOTAL PREFERRED STOCKS              
(Cost $8,711,512)             8,799,510
WARRANTS—–%   SHARES         VALUE
SYSTEMS SOFTWARE—–%              
Choicestream, Inc. , 6/22/26@,(a) 387,502       –
(Cost $387,114)              –
MASTER LIMITED PARTNERSHIP—1.2%   SHARES         VALUE
ASSET MANAGEMENT & CUSTODY BANKS—1.2%              
The Blackstone Group LP. 941,019   31,477,085
(Cost $27,542,334)             31,477,085
REAL ESTATE INVESTMENT TRUST—2.0%   SHARES         VALUE
SPECIALIZED—2.0%              
Crown Castle International Corp. 268,986       27,054,612
Equinix, Inc. 58,411       26,327,590
        53,382,202
TOTAL REAL ESTATE INVESTMENT TRUST              
(Cost $46,771,775)             53,382,202

 

- 6 -

 

THE ALGER FUNDS | ALGER CAPITAL APPRECIATION FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

    PRINCIPAL        
CORPORATE BONDS—0.0%   AMOUNT       VALUE
SYSTEMS SOFTWARE—–%            
Choicestream, Inc. , 11.00%, 8/05/18@,(a) 387,502     $ –
(Cost $388)            –
Total Investments            
       (Cost $2,039,579,032)(b) 98.8 %   2,665,504,558
Other Assets in Excess of Liabilities 1.2 %   32,498,820
NET ASSETS 100.0 % $ 2,698,003,378

 

* Non-income producing security.
# American Depositary Receipts.
@ Restricted security - Investment in security not registered under the Securities Act of 1933. The investment is
deemed to not be liquid and may be sold only to qualified buyers.

        % of net assets       % of net assets  
  Acquisition     (Acquisition     Market as of  
Security Date(s)   Cost Date)     Value 7/31/2017  
Choicestream, Inc. 03/14/14 $ 24,057 0.00 % $ 0 0.00 %
Choicestream, Inc. , 11.00%,                  
8/05/18 08/04/16   388 0.00 %   0 0.00 %
Choicestream, Inc. , 6/22/26 08/04/16   387,114 0.02 %   0 0.00 %
Choicestream, Inc. , Cl. A 12/17/13   572,038 0.03 %   0 0.00 %
Choicestream, Inc. , Cl. B 07/10/14   989,973 0.05 %   0 0.00 %
Intarcia Therapeutics, Inc. , Series                  
DD 03/27/14   2,483,730 0.14 %   4,503,534 0.17 %
Palantir Technologies, Inc. , Cl. A 10/07/14   997,406 0.05 %   931,955 0.03 %
Palantir Technologies, Inc. , Cl. B 10/07/14   4,128,004 0.22 %   3,800,790 0.14 %
Palantir Technologies, Inc. , Cl. D 10/14/14   537,767 0.03 %   495,186 0.02 %
Total           $ 9,731,465 0.36 %
                   

 

(a) Deemed an affiliate of the Alger fund complex during the year for purposes of Section 2(a)(3) of the
Investment Company Act of 1940. See Affiliated Securities in Notes to Financial Statements.
(b) At July 31, 2017, the net unrealized appreciation on investments, based on cost for federal income tax
purposes of $2,075,865,824, amounted to $589,638,734 which consisted of aggregate gross unrealized
appreciation of $637,966,595 and aggregate gross unrealized depreciation of $48,327,861.

See Notes to Financial Statements

- 7 -

 

THE ALGER FUNDS | ALGER INTERNATIONAL GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited)

COMMON STOCKS—97.4%   SHARES   VALUE
AUSTRALIA—1.4%        
DIVERSIFIED METALS & MINING—1.4%        
Rio Tinto Ltd. 48,000 $ 2,530,186
          (Cost $2,090,449)        
AUSTRIA—1.4%        
DIVERSIFIED BANKS—1.4%        
Erste Group Bank AG 58,000   2,402,541
          (Cost $2,003,254)        
BRAZIL—0.5%        
DIVERSIFIED BANKS—0.5%        
Itau Unibanco Holding SA* 70,000   837,831
          (Cost $861,351)        
CANADA—9.7%        
DIVERSIFIED BANKS—1.9%        
Royal Bank of Canada 44,000   3,282,355
FOOD RETAIL—1.2%        
Alimentation Couche-Tard, Inc. 45,000   2,133,782
GOLD—0.3%        
Agnico Eagle Mines Ltd. 12,700   592,932
INTEGRATED OIL & GAS—0.6%        
Suncor Energy, Inc. 30,000   978,585
LIFE & HEALTH INSURANCE—2.4%        
Manulife Financial Corp. 207,000   4,263,523
OIL & GAS EXPLORATION & PRODUCTION—3.3%        
Canadian Natural Resources Ltd. 30,000   917,469
Encana Corp. 482,000   4,851,700
        5,769,169
TOTAL CANADA        
(Cost $16,815,960)       17,020,346
CHINA—11.0%        
CASINOS & GAMING—0.6%        
Sands China Ltd. 200,000   926,295
CONSTRUCTION & ENGINEERING—0.6%        
China State Construction International Holdings Ltd. 680,000   1,097,106
DIVERSIFIED BANKS—1.0%        
China Construction Bank Corp. 2,170,000   1,801,771
ELECTRICAL COMPONENTS & EQUIPMENT—0.7%        
Byd Co. , Ltd. 200,000   1,244,787
ELECTRONIC EQUIPMENT & INSTRUMENTS—0.5%        
Hangzhou Hikvision Digital Technology Co. , Ltd. 200,000   891,071
HEALTH CARE FACILITIES—0.7%        
China Resources Phoenix Healthcare Holdings Co. , Ltd. * 953,705   1,204,236
INTERNET RETAIL—0.5%        
JD. com, Inc. #* 20,000   903,400
INTERNET SOFTWARE & SERVICES—6.4%        
Alibaba Group Holding Ltd. #* 39,000   6,043,050
Tencent Holdings Ltd. 127,500   5,089,000
        11,132,050
TOTAL CHINA        
(Cost $13,770,564)       19,200,716

 

- 8 -

 

THE ALGER FUNDS | ALGER INTERNATIONAL GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES   VALUE
DENMARK—0.4%        
BIOTECHNOLOGY—0.4%        
Genmab A/S* 3,000 $ 681,731
           (Cost $675,637)        
FRANCE—6.4%        
APPAREL ACCESSORIES & LUXURY GOODS—0.7%        
LVMH Moet Hennessy Louis Vuitton SE 5,000   1,255,890
AUTO PARTS & EQUIPMENT—1.1%        
Valeo SA 28,000   1,938,598
BIOTECHNOLOGY—0.3%        
DBV Technologies SA#* 12,100   538,934
CONSTRUCTION & ENGINEERING—0.8%        
SPIE SA* 49,000   1,377,205
DIVERSIFIED BANKS—2.4%        
BNP Paribas SA 54,000   4,184,590
ELECTRICAL COMPONENTS & EQUIPMENT—1.1%        
Schneider Electric SE 24,900   1,954,148
TOTAL FRANCE        
(Cost $10,225,259)       11,249,365
GERMANY—13.6%        
ADVERTISING—1.2%        
Stroeer SE & Co KGaA 31,600   2,037,182
APPLICATION SOFTWARE—2.0%        
SAP SE 33,200   3,515,241
AUTOMOBILE MANUFACTURERS—1.0%        
Bayerische Motoren Werke AG 9,235   848,471
Volkswagen AG 6,000   922,695
        1,771,166
CONSTRUCTION & FARM MACHINERY & HEAVY TRUCKS—1.4%        
KION Group AG 27,600   2,394,841
HEALTH CARE SERVICES—0.6%        
Fresenius Medical Care AG & Co. 11,700   1,103,269
INDUSTRIAL CONGLOMERATES—1.5%        
Siemens AG 20,000   2,713,918
INTEGRATED TELECOMMUNICATION SERVICES—1.0%        
Deutsche Telekom AG 99,000   1,808,529
MULTI-LINE INSURANCE—1.9%        
Allianz SE 15,391   3,280,576
PHARMACEUTICALS—1.6%        
Bayer AG 22,200   2,811,759
REAL ESTATE OPERATING COMPANIES—0.8%        
Aroundtown Property Holdings PLC. 240,000   1,422,185
STEEL—0.6%        
thyssenkrupp AG 34,000   1,009,806
TOTAL GERMANY        
(Cost $20,619,790)       23,868,472
HONG KONG—3.0%        
HOUSEHOLD APPLIANCES—0.8%        
Techtronic Industries Co. , Ltd. 330,000   1,466,278

 

- 9 -

 

THE ALGER FUNDS | ALGER INTERNATIONAL GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES   VALUE
HONG KONG—(CONT. )        
INDUSTRIAL CONGLOMERATES—0.8%        
CK Hutchison Holdings Ltd. 100,000 $ 1,315,904
LIFE & HEALTH INSURANCE—1.4%        
AIA Group Ltd. 312,693   2,459,474
TOTAL HONG KONG        
(Cost $4,551,305)       5,241,656
INDIA—2.5%        
ALUMINUM—0.5%        
Hindalco Industries Ltd. * 250,000   857,160
DIVERSIFIED BANKS—1.1%        
HDFC Bank Ltd. 64,727   1,849,878
OIL & GAS REFINING & MARKETING—0.9%        
Reliance Industries Ltd. * 65,000   1,635,759
TOTAL INDIA        
(Cost $2,752,682)       4,342,797
ITALY—2.2%        
DIVERSIFIED BANKS—1.1%        
UniCredit SpA* 100,000   1,965,311
INTERNET RETAIL—1.1%        
Yoox Net-A-Porter Group SpA* 55,000   1,821,655
TOTAL ITALY        
(Cost $3,200,868)       3,786,966
JAPAN—15.1%        
AUTOMOBILE MANUFACTURERS—0.7%        
Subaru Corp. * 31,706   1,144,015
COMMODITY CHEMICALS—0.7%        
Toray Industries, Inc. 133,706   1,207,520
CONSTRUCTION & ENGINEERING—0.6%        
Kyudenko Corp. * 30,000   1,131,680
CONSUMER ELECTRONICS—1.5%        
Sony Corp. 62,000   2,547,574
DIVERSIFIED BANKS—1.6%        
Mitsubishi UFJ Financial Group, Inc. 436,000   2,766,409
DIVERSIFIED CHEMICALS—0.7%        
Daicel Corp. 95,900   1,246,689
DIVERSIFIED REAL ESTATE ACTIVITIES—0.8%        
Mitsui Fudosan Co. , Ltd. 64,550   1,481,639
ELECTRONIC COMPONENTS—0.8%        
Alps Electric Co. , Ltd. 53,500   1,455,037
ELECTRONIC EQUIPMENT MANUFACTURERS—0.5%        
Keyence Corp. 1,900   877,757
FOOD RETAIL—1.0%        
Seven & i Holdings Co. , Ltd. 42,000   1,693,027
GENERAL MERCHANDISE STORES—0.7%        
Don Quijote Holdings Co. , Ltd. 33,000   1,198,685
HOMEBUILDING—0.7%        
Haseko Corp. 98,900   1,238,459
HUMAN RESOURCE & EMPLOYMENT SERVICES—0.8%        
Persol Holdings Co. , Ltd. 75,000   1,422,179

 

- 10 -

 

THE ALGER FUNDS | ALGER INTERNATIONAL GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES   VALUE
JAPAN—(CONT. )        
INDUSTRIAL MACHINERY—1.5%        
DMG Mori Co. , Ltd. * 80,000 $ 1,327,271
FANUC Corp. 6,400   1,308,689
        2,635,960
LIFE & HEALTH INSURANCE—0.9%        
T&D Holdings, Inc. * 110,000   1,622,915
OIL & GAS REFINING & MARKETING—0.5%        
Nippon Gas Co. , Ltd. 30,000   941,664
WIRELESS TELECOMMUNICATION SERVICES—1.1%        
SoftBank Group Corp. 24,000   1,934,605
TOTAL JAPAN        
(Cost $24,859,666)       26,545,814
NETHERLANDS—2.0%        
DIVERSIFIED BANKS—0.9%        
ING Groep NV 89,035   1,663,445
SEMICONDUCTOR EQUIPMENT—1.1%        
ASML Holding NV# 12,800   1,924,224
TOTAL NETHERLANDS        
(Cost $2,716,956)       3,587,669
NORWAY—1.1%        
DIVERSIFIED BANKS—0.5%        
Skandiabanken ASA(a) 81,000   911,618
PACKAGED FOODS & MEATS—0.6%        
Leroy Seafood Group ASA 165,000   957,610
TOTAL NORWAY        
(Cost $1,621,758)       1,869,228
RUSSIA—0.4%        
FOOD RETAIL—0.4%        
X5 Retail Group NV*,(b) 20,000   773,600
          (Cost $650,901)        
SOUTH KOREA—4.7%        
DIVERSIFIED METALS & MINING—0.7%        
POSCO* 4,000   1,194,331
ELECTRONIC EQUIPMENT MANUFACTURERS—0.8%        
SFA Engineering Corp. * 40,600   1,360,923
SEMICONDUCTORS—1.3%        
SK Hynix, Inc. 40,000   2,349,867
TECHNOLOGY HARDWARE STORAGE & PERIPHERALS—1.9%        
Samsung Electronics Co. , Ltd. 1,560   3,352,143
TOTAL SOUTH KOREA        
(Cost $6,541,206)       8,257,264
SPAIN—0.8%        
ELECTRIC UTILITIES—0.8%        
Iberdrola SA 180,000   1,418,869
          (Cost $1,264,763)        
SWEDEN—2.6%        
BUILDING PRODUCTS—0.5%        
Assa Abloy AB, Cl. B 42,000   899,697

 

- 11 -

 

THE ALGER FUNDS | ALGER INTERNATIONAL GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES   VALUE
SWEDEN—(CONT. )        
DIVERSIFIED BANKS—1.1%        
Nordea Bank AB* 148,000 $ 1,867,308
ELECTRONIC MANUFACTURING SERVICES—0.3%        
HMS Networks AB 32,073   470,704
HOUSEHOLD PRODUCTS—0.7%        
Essity AB* 43,000   1,246,693
TOTAL SWEDEN        
(Cost $4,062,236)       4,484,402
SWITZERLAND—5.6%        
DIVERSIFIED CAPITAL MARKETS—3.0%        
Credit Suisse Group AG 120,000   1,845,080
UBS Group AG 197,000   3,426,809
        5,271,889
INDUSTRIAL MACHINERY—0.8%        
Interroll Holding AG* 1,000   1,311,679
PACKAGED FOODS & MEATS—1.8%        
Nestle SA 38,000   3,208,392
TOTAL SWITZERLAND        
(Cost $9,294,836)       9,791,960
TAIWAN—2.9%        
ELECTRONIC COMPONENTS—0.4%        
Largan Precision Co. , Ltd. * 4,000   729,378
ENVIRONMENTAL & FACILITIES SERVICES—0.4%        
Sunny Friend Environmental Technology Co. , Ltd. 160,000   812,643
SEMICONDUCTORS—2.1%        
Taiwan Semiconductor Manufacturing Co. , Ltd. * 514,100   3,631,839
TOTAL TAIWAN        
(Cost $3,432,249)       5,173,860
UNITED KINGDOM—6.8%        
ASSET MANAGEMENT & CUSTODY BANKS—1.0%        
Man Group PLC. 840,000   1,773,483
DIVERSIFIED SUPPORT SERVICES—0.5%        
Babcock International Group PLC. 80,000   891,241
HOUSEHOLD PRODUCTS—0.9%        
Reckitt Benckiser Group PLC. 16,000   1,555,756
INDUSTRIAL CONGLOMERATES—0.7%        
Smiths Group PLC. 62,000   1,255,897
IT CONSULTING & OTHER SERVICES—0.8%        
Keywords Studios PLC. * 90,904   1,354,211
PHARMACEUTICALS—1.8%        
GlaxoSmithKline PLC. 87,104   1,734,108
Shire PLC. 24,000   1,341,760
        3,075,868
TRADING COMPANIES & DISTRIBUTORS—1.1%        
Ashtead Group PLC. 90,000   1,933,735
TOTAL UNITED KINGDOM        
(Cost $11,273,510)       11,840,191

 

- 12 -

 

THE ALGER FUNDS | ALGER INTERNATIONAL GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES       VALUE
UNITED STATES—3.3%            
BUILDING PRODUCTS—0.3%            
Johnson Controls International PLC. 15,000     $ 584,250
HEALTH CARE EQUIPMENT—0.8%            
Medtronic PLC. 16,000       1,343,520
SEMICONDUCTORS—2.2%            
Broadcom Ltd. 15,600       3,847,896
TOTAL UNITED STATES            
(Cost $4,783,611)           5,775,666
TOTAL COMMON STOCKS            
             (Cost $148,068,811)         170,681,130
Total Investments            
(Cost $148,068,811)(c) 97.4 %   170,681,130
Other Assets in Excess of Liabilities 2.6 %   4,582,672
NET ASSETS 100.0 % $ 175,263,802

 

* Non-income producing security.
# American Depositary Receipts.
(a) Global Depositary Receipts.
(b) Pursuant to Securities and Exchange Commission Rule 144A, these securities may be sold prior to their
maturity only to qualified institutional buyers.  These securities are however deemed to be liquid and represent
0.5% of the net assets of the Portfolio.
(c) At July 31, 2017, the net unrealized appreciation on investments, based on cost for federal income tax
purposes of $148,974,634, amounted to $21,706,496 which consisted of aggregate gross unrealized
appreciation of $27,715,859 and aggregate gross unrealized depreciation of $6,009,363.

See Notes to Financial Statements

- 13 -

 

THE ALGER FUNDS | ALGER MID CAP GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited)

COMMON STOCKS—91.7%   SHARES       VALUE
AEROSPACE & DEFENSE—0.7%            
HEICO Corp. 16,583 $ 1,332,776
APPAREL ACCESSORIES & LUXURY GOODS—1.7%            
Hanesbrands, Inc. 38,841     890,235
PVH Corp. 18,182     2,168,931
          3,059,166
APPAREL RETAIL—0.9%            
Burlington Stores, Inc. * 9,478     824,870
Ross Stores, Inc. 15,415     852,758
          1,677,628
APPLICATION SOFTWARE—3.8%            
Autodesk, Inc. * 28,743     3,184,437
Mobileye NV* 28,244     1,787,845
PTC, Inc. * 12,195     673,042
Splunk, Inc. * 18,292     1,097,703
          6,743,027
ASSET MANAGEMENT & CUSTODY BANKS—1.0%            
WisdomTree Investments, Inc. 169,767     1,772,367
AUTO PARTS & EQUIPMENT—1.9%            
Delphi Automotive PLC. 17,738     1,603,870
WABCO Holdings, Inc. * 13,091     1,800,929
          3,404,799
AUTOMOTIVE RETAIL—0.3%            
O'Reilly Automotive, Inc. * 2,415     493,385
BIOTECHNOLOGY—7.9%            
Alexion Pharmaceuticals, Inc. * 7,198     988,573
BioMarin Pharmaceutical, Inc. * 17,158     1,505,271
Bluebird Bio, Inc. * 13,469     1,269,453
Clovis Oncology, Inc. * 23,020     1,952,326
Exact Sciences Corp. * 30,143     1,169,549
Exelixis, Inc. * 26,856     728,066
Incyte Corp. * 14,400     1,919,376
Sarepta Therapeutics, Inc. * 26,929     1,038,921
TESARO, Inc. * 9,588     1,224,004
Vertex Pharmaceuticals, Inc. * 14,319     2,173,911
        13,969,450
BROADCASTING—0.8%            
CBS Corp. , Cl. B 22,950     1,510,798
BUILDING PRODUCTS—1.9%            
Fortune Brands Home & Security, Inc. 32,873     2,158,770
Johnson Controls International PLC. 29,083     1,132,783
          3,291,553
CASINOS & GAMING—1.1%            
MGM Resorts International 26,330     867,047
Wynn Resorts Ltd. 8,303     1,073,910
          1,940,957
COMMUNICATIONS EQUIPMENT—1.5%            
Lumentum Holdings, Inc. * 17,048     1,067,205

 

- 14 -

 

THE ALGER FUNDS | ALGER MID CAP GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES       VALUE
COMMUNICATIONS EQUIPMENT—(CONT. )            
Palo Alto Networks, Inc. * 11,712 $ 1,543,407
          2,610,612
CONSTRUCTION MATERIALS—0.9%            
Vulcan Materials Co. 12,699     1,563,501
CONSUMER FINANCE—0.4%            
LendingClub Corp. * 143,989     730,024
DATA PROCESSING & OUTSOURCED SERVICES—3.9%            
Fiserv, Inc. * 24,047     3,090,039
FleetCor Technologies, Inc. * 4,807     730,952
Total System Services, Inc. 23,332     1,480,649
WNS Holdings Ltd. #* 46,847     1,618,564
          6,920,204
ELECTRICAL COMPONENTS & EQUIPMENT—1.6%            
AMETEK, Inc. 15,459     951,965
Rockwell Automation, Inc. 11,586     1,912,038
          2,864,003
ELECTRONIC COMPONENTS—0.7%            
Universal Display Corp. 10,061     1,213,357
ELECTRONIC EQUIPMENT & INSTRUMENTS—1.0%            
Cognex Corp. 5,113     486,042
Trimble, Inc. * 34,286     1,283,325
          1,769,367
FERTILIZERS & AGRICULTURAL CHEMICALS—0.7%            
FMC Corporation 15,217     1,162,274
FINANCIAL EXCHANGES & DATA—3.2%            
IntercontinentalExchange Group, Inc. 32,859     2,192,024
MarketAxess Holdings, Inc. 8,909     1,807,547
S&P Global, Inc. 10,953     1,682,271
          5,681,842
FOOD DISTRIBUTORS—1.2%            
Performance Food Group Co. * 71,806     2,068,013
GENERAL MERCHANDISE STORES—0.8%            
Dollar Tree, Inc. * 21,024     1,515,410
HEALTH CARE EQUIPMENT—5.9%            
ABIOMED, Inc. * 15,369     2,275,995
DexCom, Inc. * 15,498     1,032,321
Edwards Lifesciences Corp. * 17,210     1,982,248
IDEXX Laboratories, Inc. * 13,243     2,204,430
Insulet Corp. * 34,332     1,727,243
Masimo Corp. * 13,485     1,275,681
        10,497,918
HEALTH CARE SUPPLIES—1.0%            
Align Technology, Inc. * 10,874     1,818,459
HEALTH CARE TECHNOLOGY—1.7%            
Agilent Technologies, Inc. 17,583     1,051,287
Cotiviti Holdings, Inc. * 15,015     646,396
Medidata Solutions, Inc. * 17,554     1,348,323
          3,046,006

 

- 15 -

 

THE ALGER FUNDS | ALGER MID CAP GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES     VALUE
HOME ENTERTAINMENT SOFTWARE—1.7%          
Electronic Arts, Inc. * 18,395 $ 2,147,432
Take-Two Interactive Software, Inc. * 11,685   928,724
        3,076,156
HOME FURNISHINGS—0.8%          
Mohawk Industries, Inc. * 5,400   1,344,546
HOTELS RESORTS & CRUISE LINES—2.3%          
Extended Stay America, Inc. 103,055   2,037,397
Norwegian Cruise Line Holdings Ltd. * 35,782   1,970,515
        4,007,912
HOUSEHOLD PRODUCTS—1.0%          
Church & Dwight Co. , Inc. 34,319   1,830,919
HOUSEWARES & SPECIALTIES—0.6%          
Newell Brands, Inc. 20,629   1,087,561
INDUSTRIAL CONGLOMERATES—1.2%          
Roper Technologies, Inc. 9,142   2,125,149
INDUSTRIAL GASES—1.1%          
Air Products & Chemicals, Inc. 13,655   1,941,058
INDUSTRIAL MACHINERY—2.8%          
Fortive Corp. 34,201   2,214,173
Stanley Black & Decker, Inc. 14,816   2,084,463
Welbilt, Inc. * 37,003   721,188
        5,019,824
INTERNET RETAIL—1.3%          
Expedia, Inc. 14,408   2,254,420
INTERNET SOFTWARE & SERVICES—2.4%          
LogMeIn, Inc. 13,480   1,569,746
Match Group, Inc. * 93,848   1,712,726
Palantir Technologies, Inc. , Cl. A*,@ 16,376   99,566
Yelp, Inc. * 25,216   820,277
        4,202,315
IT CONSULTING & OTHER SERVICES—2.7%          
DXC Technology Co. 14,796   1,159,711
EPAM Systems, Inc. * 18,143   1,559,028
Gartner, Inc. * 16,492   2,116,253
        4,834,992
LEISURE FACILITIES—1.3%          
Vail Resorts, Inc. 11,338   2,389,597
LEISURE PRODUCTS—0.7%          
Coach, Inc. 27,489   1,295,831
LIFE SCIENCES TOOLS & SERVICES—1.8%          
Illumina, Inc. * 12,232   2,126,533
Mettler-Toledo International, Inc. * 1,929   1,105,472
        3,232,005
MANAGED HEALTH CARE—0.9%          
WellCare Health Plans, Inc. * 9,207   1,629,547
METAL & GLASS CONTAINERS—0.9%          
Ball Corp. 37,525   1,572,297

 

- 16 -

 

THE ALGER FUNDS | ALGER MID CAP GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES       VALUE
OIL & GAS EXPLORATION & PRODUCTION—1.3%            
Encana Corp. 77,397 $ 778,614
Parsley Energy, Inc. , Cl. A* 18,645     545,925
Pioneer Natural Resources Co. 5,757     938,967
          2,263,506
PACKAGED FOODS & MEATS—1.1%            
Pinnacle Foods, Inc. 14,704     873,123
TreeHouse Foods, Inc. * 11,820     1,002,691
          1,875,814
PAPER PACKAGING—0.5%            
International Paper Co. * 16,336     898,153
PHARMACEUTICALS—2.2%            
Aerie Pharmaceuticals, Inc. * 32,154     1,745,962
Zoetis, Inc. 34,497     2,156,753
          3,902,715
PROPERTY & CASUALTY INSURANCE—0.5%            
The Progressive Corp. 19,666     926,859
RAILROADS—0.6%            
Kansas City Southern 9,819     1,013,223
REGIONAL BANKS—1.7%            
Citizens Financial Group, Inc. 23,317     817,960
Regions Financial Corp. 149,868     2,188,073
          3,006,033
SEMICONDUCTOR EQUIPMENT—1.7%            
Lam Research Corp. 18,710     2,983,497
SEMICONDUCTORS—4.9%            
Broadcom Ltd. 12,116     2,988,532
Cavium Networks, Inc. * 35,221     2,181,589
Microchip Technology, Inc. 22,408     1,793,536
Skyworks Solutions, Inc. 16,118     1,690,295
          8,653,952
SPECIALTY STORES—0.5%            
Ulta Beauty, Inc. * 3,313     832,259
SYSTEMS SOFTWARE—3.5%            
Proofpoint, Inc. * 17,946     1,529,717
Red Hat, Inc. * 24,750     2,447,032
ServiceNow, Inc. * 19,991     2,208,006
          6,184,755
TECHNOLOGY HARDWARE STORAGE & PERIPHERALS—1.4%            
Western Digital Corp. 29,350     2,498,272
TRADING COMPANIES & DISTRIBUTORS—1.4%            
HD Supply Holdings, Inc. * 35,053     1,138,872
United Rentals, Inc. * 10,985     1,306,776
          2,445,648
TRUCKING—0.4%            
Old Dominion Freight Line, Inc. 7,703     738,795
TOTAL COMMON STOCKS            
       (Cost $140,288,569)         162,724,506

 

- 17 -

 

THE ALGER FUNDS | ALGER MID CAP GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

PREFERRED STOCKS—0.7%   SHARES         VALUE
BIOTECHNOLOGY—0.5%              
Prosetta Biosciences, Inc. , Series D*,@,(a) 219,610     $   836,714
INTERNET SOFTWARE & SERVICES—0.2%              
Palantir Technologies, Inc. , Cl. B*,@ 66,787         406,065
Palantir Technologies, Inc. , Cl. D*,@ 8,701         52,902
              458,967
TOTAL PREFERRED STOCKS              
(Cost $1,486,720)             1,295,681
RIGHTS—0.8%   SHARES         VALUE
BIOTECHNOLOGY—0.8%              
Tolero Pharmaceuticals, Inc. , CDR@,(a) 590,059         1,361,738
(Cost $315,502)             1,361,738
REAL ESTATE INVESTMENT TRUST—3.6%   SHARES         VALUE
HEALTH CARE—0.4%              
Omega Healthcare Investors, Inc. 22,865         722,306
SPECIALIZED—3.2%              
Crown Castle International Corp. 9,176         922,922
CyrusOne, Inc. 26,967         1,610,200
Lamar Advertising Co. , Cl. A 21,883         1,544,283
SBA Communications Corp. , Cl. A* 11,355         1,561,880
              5,639,285
TOTAL REAL ESTATE INVESTMENT TRUST              
(Cost $6,097,138)             6,361,591
SPECIAL PURPOSE VEHICLE—0.2%   SHARES         VALUE
CONSUMER FINANCE—0.2%              
JS Kred SPV I, LLC.@ 314,956         357,727
(Cost $314,956)             357,727
Total Investments              
(Cost $148,502,885)(b) 97.0 %   172,101,243
Other Assets in Excess of Liabilities 3.0 %       5,397,923
NET ASSETS 100.0 %   $   177,499,166

 

* Non-income producing security.
# American Depositary Receipts.

- 18 -

 

THE ALGER FUNDS | ALGER MID CAP GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

@ Restricted security - Investment in security not registered under the Securities Act of 1933. The investment is
deemed to not be liquid and may be sold only to qualified buyers.

        % of net assets       % of net assets  
  Acquisition     (Acquisition     Market as of  
Security Date(s)   Cost Date)     Value 7/31/2017  
JS Kred SPV I, LLC. 06/26/15 $ 314,956 0.15 % $ 357,727 0.20 %
Palantir Technologies, Inc. , Cl. A 10/07/14   106,558 0.05 %   99,566 0.06 %
Palantir Technologies, Inc. , Cl. B 10/07/14   441,024 0.22 %   406,065 0.23 %
Palantir Technologies, Inc. , Cl. D 10/14/14   57,451 0.03 %   52,902 0.03 %
Prosetta Biosciences, Inc. , Series                  
D 02/06/15   988,245 0.50 %   836,714 0.47 %
Tolero Pharmaceuticals, Inc. ,                  
CDR 01/11/17   315,502 0.15 %   1,361,738 0.77 %
Total           $ 3,114,712 1.76 %
                   

 

(a) Deemed an affiliate of the Alger fund complex during the year for purposes of Section 2(a)(3) of the
Investment Company Act of 1940. See Affiliated Securities in Notes to Financial Statements.
(b) At July 31, 2017, the net unrealized appreciation on investments, based on cost for federal income tax
purposes of $148,562,615, amounted to $23,538,628 which consisted of aggregate gross unrealized
appreciation of $26,041,227 and aggregate gross unrealized depreciation of $2,502,599.

See Notes to Financial Statements

- 19 -

 

THE ALGER FUNDS | ALGER SMID CAP GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited)

COMMON STOCKS—92.6%   SHARES       VALUE
AEROSPACE & DEFENSE—2.6%            
HEICO Corp. 52,899 $ 4,251,493
AIR FREIGHT & LOGISTICS—2.5%            
XPO Logistics, Inc. * 68,208     4,099,983
APPAREL ACCESSORIES & LUXURY GOODS—1.4%            
Canada Goose Holdings, Inc. * 123,508     2,354,062
APPAREL RETAIL—0.7%            
Francesca's Holdings Corp. * 111,101     1,081,013
APPLICATION SOFTWARE—14.3%            
Ebix, Inc. 77,482     4,474,586
Everbridge, Inc. * 160,025     3,784,591
Globant SA* 51,873     2,384,602
HubSpot, Inc. * 34,967     2,529,862
Paylocity Holding Corp. * 108,988     4,955,684
RealPage, Inc. * 18,706     724,858
Ultimate Software Group, Inc. * 21,570     4,868,565
        23,722,748
ASSET MANAGEMENT & CUSTODY BANKS—1.0%            
Financial Engines, Inc. 14,467     556,256
Virtus Investment Partners, Inc. 9,023     1,062,909
          1,619,165
BIOTECHNOLOGY—9.4%            
ACADIA Pharmaceuticals, Inc. * 132,021     3,930,265
Portola Pharmaceuticals, Inc. * 93,818     5,788,571
Puma Biotechnology, Inc. * 29,191     2,774,604
Ultragenyx Pharmaceutical, Inc. * 46,768     3,101,654
        15,595,094
CONSUMER ELECTRONICS—0.6%            
GoPro, Inc. * 125,867     1,037,144
EDUCATION SERVICES—3.2%            
Chegg, Inc. * 376,150     5,209,677
ELECTRONIC MANUFACTURING SERVICES—2.5%            
IPG Photonics Corp. * 26,984     4,118,838
GENERAL MERCHANDISE STORES—1.9%            
Ollie's Bargain Outlet Holdings, Inc. * 70,933     3,170,705
HEALTH CARE EQUIPMENT—3.1%            
Insulet Corp. * 102,385     5,150,989
HEALTH CARE FACILITIES—1.5%            
US Physical Therapy, Inc. 39,349     2,482,922
HEALTH CARE SERVICES—0.9%            
Diplomat Pharmacy, Inc. * 94,265     1,495,985
HEALTH CARE TECHNOLOGY—2.3%            
Cotiviti Holdings, Inc. * 87,780     3,778,929
HUMAN RESOURCE & EMPLOYMENT SERVICES—2.7%            
WageWorks, Inc. * 67,214     4,382,353
INDUSTRIAL MACHINERY—4.3%            
Middleby Corp. * 49,167     6,425,144
Proto Labs, Inc. * 9,129     674,633
          7,099,777

 

- 20 -

 

THE ALGER FUNDS | ALGER SMID CAP GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES       VALUE
INTERNET RETAIL—3.8%            
Wayfair, Inc. , Cl. A* 83,097 $ 6,344,456
INTERNET SOFTWARE & SERVICES—10.5%            
2U, Inc. * 31,787     1,644,977
GTT Communications, Inc. * 103,062     3,148,544
Palantir Technologies, Inc. , Cl. A*,@ 81,310     494,365
Shutterstock, Inc. * 2,802     118,076
SPS Commerce, Inc. * 5,218     301,600
Stamps. com, Inc. * 48,899     7,241,942
The Trade Desk, Inc. , Cl. A* 81,211     4,329,359
        17,278,863
IT CONSULTING & OTHER SERVICES—2.0%            
EPAM Systems, Inc. * 39,256     3,373,268
LEISURE FACILITIES—1.7%            
Planet Fitness, Inc. , Cl. A 127,277     2,884,097
PHARMACEUTICALS—0.6%            
Aerie Pharmaceuticals, Inc. * 17,238     936,023
REAL ESTATE SERVICES—4.4%            
FirstService Corp. 112,439     7,245,569
REGIONAL BANKS—3.9%            
Independent Bank Group, Inc. 41,205     2,486,722
Signature Bank* 28,988     4,017,157
          6,503,879
RESTAURANTS—0.7%            
Chuy's Holdings, Inc. * 48,527     1,142,811
SEMICONDUCTORS—3.8%            
Impinj, Inc. * 5,624     276,364
MACOM Technology Solutions Holdings, Inc. * 98,775     5,980,826
          6,257,190
TECHNOLOGY HARDWARE STORAGE & PERIPHERALS—1.2%            
Electronics For Imaging, Inc. * 41,438     2,013,058
Stratasys Ltd. * 2,233     53,570
          2,066,628
THRIFTS & MORTGAGE FINANCE—2.6%            
BofI Holding, Inc. * 153,978     4,291,367
TRADING COMPANIES & DISTRIBUTORS—2.5%            
H&E Equipment Services, Inc. 42,870     967,576
SiteOne Landscape Supply, Inc. * 59,070     3,101,175
          4,068,751
TOTAL COMMON STOCKS            
      (Cost $130,701,532)         153,043,779
PREFERRED STOCKS—3.6%   SHARES       VALUE
BIOTECHNOLOGY—0.5%            
Prosetta Biosciences, Inc. , Series D*,@,(a) 231,474     881,916
INTERNET SOFTWARE & SERVICES—1.4%            
Palantir Technologies, Inc. , Cl. B*,@ 331,607     2,016,171
Palantir Technologies, Inc. , Cl. D*,@ 43,203     262,674
          2,278,845

 

- 21 -

 

THE ALGER FUNDS | ALGER SMID CAP GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

PREFERRED STOCKS—(CONT. )   SHARES         VALUE
PHARMACEUTICALS—1.7%              
Intarcia Therapeutics, Inc. , Series DD*,@ 49,317     $   2,896,387
TOTAL PREFERRED STOCKS              
(Cost $5,114,017)             6,057,148
RIGHTS—0.1%   SHARES         VALUE
BIOTECHNOLOGY—0.1%              
Dyax Corp. *,@ 37,550         106,642
       (Cost $1)             106,642
Total Investments              
(Cost $135,815,550)(b) 96.3 %   159,207,569
Other Assets in Excess of Liabilities 3.7 %       6,127,835
NET ASSETS 100.0 %   $   165,335,404

 

* Non-income producing security.
@ Restricted security - Investment in security not registered under the Securities Act of 1933. The investment is
deemed to not be liquid and may be sold only to qualified buyers.

        % of net assets       % of net assets  
  Acquisition     (Acquisition     Market as of  
Security Date(s)   Cost Date)     Value 7/31/2017  
Dyax Corp. 05/07/15 $ 0 0 % $ 1,704 0.00 %
Dyax Corp. 05/15/15   0 0 % $ 45,156 0.03 %
Dyax Corp. 06/18/15   0 0 % $ 19,312 0.01 %
Dyax Corp. 06/26/15   0 0 % $ 40,470 0.02 %
Intarcia Therapeutics, Inc. , Series                  
DD 03/27/14   1,597,378 0.14 %   2,896,387 1.75 %
Palantir Technologies, Inc. , Cl. A 10/07/14   529,084 0.05 %   494,365 0.30 %
Palantir Technologies, Inc. , Cl. B 10/07/14   2,189,744 0.22 %   2,016,171 1.22 %
Palantir Technologies, Inc. , Cl. D 10/14/14   285,262 0.03 %   262,674 0.16 %
Prosetta Biosciences, Inc. , Series                  
D 02/06/15   1,041,633 0.10 %   881,916 0.53 %
Total           $ 6,658,155 4.02 %
                   

 

(a) Deemed an affiliate of the Alger fund complex during the year for purposes of Section 2(a)(3) of the
Investment Company Act of 1940. See Affiliated Securities in Notes to Financial Statements.
(b) At July 31, 2017, the net unrealized appreciation on investments, based on cost for federal income tax
purposes of $142,574,388, amounted to $16,633,181 which consisted of aggregate gross unrealized
appreciation of $26,778,037 and aggregate gross unrealized depreciation of $10,144,856.

See Notes to Financial Statements

- 22 -

 

THE ALGER FUNDS | ALGER SMALL CAP GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited)

COMMON STOCKS—96.8%   SHARES       VALUE
AEROSPACE & DEFENSE—1.4%            
Hexcel Corp. 36,897 $ 1,888,019
APPAREL RETAIL—0.7%            
Burlington Stores, Inc. * 10,920     950,368
APPLICATION SOFTWARE—13.3%            
ACI Worldwide, Inc. * 101,461     2,350,851
Blackbaud, Inc. 40,898     3,776,521
Ellie Mae, Inc. * 11,521     1,004,862
Everbridge, Inc. * 27,084     640,537
Guidewire Software, Inc. * 26,163     1,887,922
HubSpot, Inc. * 21,438     1,551,039
Manhattan Associates, Inc. * 43,165     1,907,893
Paycom Software, Inc. * 13,586     952,243
Tyler Technologies, Inc. * 21,601     3,711,268
        17,783,136
ASSET MANAGEMENT & CUSTODY BANKS—2.1%            
WisdomTree Investments, Inc. 272,830     2,848,345
BIOTECHNOLOGY—5.4%            
ACADIA Pharmaceuticals, Inc. * 43,948     1,308,332
Bluebird Bio, Inc. * 4,216     397,358
Clovis Oncology, Inc. * 11,531     977,944
Halozyme Therapeutics, Inc. * 51,042     647,212
Incyte Corp. * 6,064     808,271
Ironwood Pharmaceuticals, Inc. * 30,125     534,719
Sarepta Therapeutics, Inc. * 13,688     528,083
TESARO, Inc. * 9,526     1,216,089
Ultragenyx Pharmaceutical, Inc. * 12,869     853,472
          7,271,480
BREWERS—0.6%            
Craft Brew Alliance, Inc. * 42,368     741,440
BUILDING PRODUCTS—1.8%            
Masonite International Corp. * 31,525     2,447,916
COMMUNICATIONS EQUIPMENT—1.4%            
NetScout Systems, Inc. * 52,671     1,817,150
CONSUMER FINANCE—1.9%            
LendingClub Corp. * 495,519     2,512,281
ELECTRONIC COMPONENTS—2.1%            
Dolby Laboratories Inc. , Cl. A 27,658     1,431,301
Universal Display Corp. 11,755     1,417,653
          2,848,954
ELECTRONIC EQUIPMENT & INSTRUMENTS—5.4%            
Cognex Corp. 57,327     5,449,505
FLIR Systems, Inc. 45,623     1,702,650
          7,152,155
FINANCIAL EXCHANGES & DATA—0.6%            
MarketAxess Holdings, Inc. 4,185     849,095
FOOD DISTRIBUTORS—1.6%            
Performance Food Group Co. * 71,730     2,065,824

 

- 23 -

 

THE ALGER FUNDS | ALGER SMALL CAP GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES       VALUE
HEALTH CARE EQUIPMENT—10.6%            
Abaxis, Inc. 45,061 $ 2,117,867
ABIOMED, Inc. * 19,874     2,943,141
Cantel Medical Corp. 47,896     3,553,883
Cardiovascular Systems, Inc. * 25,444     802,758
DexCom, Inc. * 16,919     1,126,975
Inogen, Inc. * 24,056     2,270,405
Insulet Corp. * 26,330     1,324,662
        14,139,691
HEALTH CARE SUPPLIES—6.2%            
Meridian Bioscience, Inc. 63,459     859,870
Neogen Corp. * 56,778     3,739,967
Quidel Corp. * 114,877     3,674,915
          8,274,752
HEALTH CARE TECHNOLOGY—9.2%            
Medidata Solutions, Inc. * 60,900     4,677,729
Quality Systems, Inc. * 82,749     1,415,008
Veeva Systems, Inc. , Cl. A* 58,318     3,718,356
Vocera Communications, Inc. * 89,531     2,441,510
        12,252,603
HOME ENTERTAINMENT SOFTWARE—2.5%            
Take-Two Interactive Software, Inc. * 41,322     3,284,273
HUMAN RESOURCE & EMPLOYMENT SERVICES—2.3%            
WageWorks, Inc. * 47,755     3,113,626
INDUSTRIAL MACHINERY—2.4%            
DMC Global, Inc. 29,564     410,939
Sun Hydraulics Corp. 67,855     2,806,483
          3,217,422
INTERNET SOFTWARE & SERVICES—4.6%            
Cornerstone OnDemand, Inc. * 37,515     1,512,230
NIC, Inc. 54,029     877,971
Q2 Holdings, Inc. * 36,341     1,413,665
Shopify, Inc. , Cl. A* 15,031     1,388,414
SPS Commerce, Inc. * 16,393     947,515
          6,139,795
IT CONSULTING & OTHER SERVICES—1.2%            
InterXion Holding NV* 33,466     1,602,017
LEISURE FACILITIES—0.9%            
Planet Fitness, Inc. , Cl. A 52,869     1,198,012
LEISURE PRODUCTS—0.3%            
Vista Outdoor, Inc. * 14,453     333,720
LIFE SCIENCES TOOLS & SERVICES—3.9%            
Bio-Techne Corp. 31,568     3,659,047
PRA Health Sciences, Inc. * 21,335     1,587,324
          5,246,371
MANAGED HEALTH CARE—0.8%            
HealthEquity, Inc. * 23,788     1,091,156
MOVIES & ENTERTAINMENT—1.5%            
Lions Gate Entertainment Corp. , Cl. A* 21,534     633,100

 

- 24 -

 

THE ALGER FUNDS | ALGER SMALL CAP GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES         VALUE
MOVIES & ENTERTAINMENT—(CONT. )              
Lions Gate Entertainment Corp. , Cl. B* 21,534 $   592,400
Live Nation Entertainment, Inc. * 19,623       731,349
            1,956,849
OIL & GAS EQUIPMENT & SERVICES—0.7%              
RPC, Inc. 43,747       906,000
OIL & GAS EXPLORATION & PRODUCTION—0.4%              
Parsley Energy, Inc. , Cl. A* 19,498       570,901
PERSONAL PRODUCTS—0.7%              
elf Beauty, Inc. * 36,951       937,447
PHARMACEUTICALS—1.3%              
Aerie Pharmaceuticals, Inc. * 31,679       1,720,170
RESTAURANTS—1.9%              
Shake Shack, Inc. , Cl. A* 45,030       1,486,440
Wingstop, Inc. 35,951       1,078,890
            2,565,330
SEMICONDUCTORS—2.2%              
Cavium Networks, Inc. * 21,259       1,316,783
Microsemi Corp. * 31,717       1,651,821
            2,968,604
SPECIALTY CHEMICALS—2.3%              
Balchem Corp. 31,950       2,479,320
Flotek Industries, Inc. * 64,794       545,565
            3,024,885
SPECIALTY STORES—0.4%              
Five Below, Inc. * 12,094       584,261
SYSTEMS SOFTWARE—2.2%              
Proofpoint, Inc. * 35,089       2,990,986
TOTAL COMMON STOCKS              
(Cost $96,740,214)         129,295,034
PREFERRED STOCKS—0.1%   SHARES         VALUE
BIOTECHNOLOGY—0.1%              
Prosetta Biosciences, Inc. , Series D*,@,(a) 50,688       193,121
(Cost $228,096)             193,121
RIGHTS—0.3%   SHARES         VALUE
BIOTECHNOLOGY—0.3%              
Dyax Corp. *,@ 9,700       27,548
Neuralstem, Inc. , 1/8/2019*,@ 5,997       –
Tolero Pharmaceuticals, Inc. , CDR@,(a) 174,782       403,362
            430,910
TOTAL RIGHTS              
(Cost $94,483)             430,910
REAL ESTATE INVESTMENT TRUST—1.0%   SHARES         VALUE
SPECIALIZED—1.0%              
CyrusOne, Inc. 22,660       1,353,029
(Cost $762,426)             1,353,029

 

- 25 -

 

THE ALGER FUNDS | ALGER SMALL CAP GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

SPECIAL PURPOSE VEHICLE—0.3%   SHARES         VALUE
CONSUMER FINANCE—0.3%              
JS Kred SPV I, LLC.@ 290,078     $   329,471
(Cost $290,078)             329,471
Total Investments              
(Cost $98,115,297)(b) 98.5 %   131,601,565
Other Assets in Excess of Liabilities 1.5 %       1,968,200
NET ASSETS 100.0 %   $   133,569,765

 

- 26 -

 

THE ALGER FUNDS | ALGER SMALL CAP GROWTH FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

* Non-income producing security.
@ Restricted security - Investment in security not registered under the Securities Act of 1933. The investment is
deemed to not be liquid and may be sold only to qualified buyers.

        % of net assets       % of net assets  
  Acquisition     (Acquisition     Market as of  
Security Date(s)   Cost Date)     Value 7/31/2017  
Dyax Corp. 05/01/15 $ 0 0.00 % $ 17,324 0.01 %
Dyax Corp. 08/14/15 $ 0 0.00 %   10,224 0.01 %
JS Kred SPV I, LLC. 06/26/15   290,078 0.15 %   329,470 0.25 %
Neuralstem, Inc. 01/03/14   0 0.00 %   0 0 %
Prosetta Biosciences, Inc. , Series                  
D 02/06/15   228,096 0.10 %   193,121 0.14 %
Tolero Pharmaceuticals, Inc. ,                  
CDR 01/11/17   94,483 0.04 %   403,362 0.30 %
Total           $ 953,501 0.71 %

 

(a) Deemed an affiliate of the Alger fund complex during the year for purposes of Section 2(a)(3) of the
Investment Company Act of 1940. See Affiliated Securities in Notes to Financial Statements.
(b) At July 31, 2017, the net unrealized appreciation on investments, based on cost for federal income tax
purposes of $99,310,451, amounted to $32,291,114 which consisted of aggregate gross unrealized
appreciation of $36,404,996 and aggregate gross unrealized depreciation of $4,113,882.

See Notes to Financial Statements

- 27 -

 

THE ALGER FUNDS | ALGER SMALL CAP FOCUS FUND
Schedule of Investments July 31, 2017 (Unaudited)

COMMON STOCKS—99.4%   SHARES       VALUE
APPLICATION SOFTWARE—20.6%            
ACI Worldwide, Inc. * 584,815 $ 13,550,163
ANSYS, Inc. * 61,985     8,030,157
Blackbaud, Inc. 161,609     14,922,975
Ellie Mae, Inc. * 83,104     7,248,331
Guidewire Software, Inc. * 164,555     11,874,289
HubSpot, Inc. * 70,693     5,114,639
Manhattan Associates, Inc. * 109,109     4,822,618
Paycom Software, Inc. * 122,676     8,598,361
PROS Holdings, Inc. * 261,850     7,549,135
Tyler Technologies, Inc. * 100,725     17,305,562
        99,016,230
ASSET MANAGEMENT & CUSTODY BANKS—2.3%            
WisdomTree Investments, Inc. 1,049,057   10,952,155
BIOTECHNOLOGY—6.2%            
Clovis Oncology, Inc. * 107,061     9,079,844
Incyte Corp. * 82,769     11,032,280
Ironwood Pharmaceuticals, Inc. * 326,012     5,786,713
TESARO, Inc. * 31,529     4,024,992
        29,923,829
COMMUNICATIONS EQUIPMENT—1.1%            
NetScout Systems, Inc. * 148,811     5,133,980
CONSUMER FINANCE—1.5%            
LendingClub Corp. * 1,438,091     7,291,121
ELECTRONIC COMPONENTS—1.7%            
Universal Display Corp. 67,978     8,198,147
ELECTRONIC EQUIPMENT & INSTRUMENTS—3.8%            
Cognex Corp. 194,674   18,505,710
FINANCIAL EXCHANGES & DATA—2.0%            
MarketAxess Holdings, Inc. 46,908     9,517,164
HEALTH CARE EQUIPMENT—14.4%            
Abaxis, Inc. 175,148     8,231,956
ABIOMED, Inc. * 54,703     8,100,967
Cantel Medical Corp. 206,481     15,320,890
Cardiovascular Systems, Inc. * 225,910     7,127,460
Heska Corp. * 75,503     8,270,599
Inogen, Inc. * 102,792     9,701,509
Insulet Corp. * 255,319     12,845,099
        69,598,480
HEALTH CARE SUPPLIES—6.3%            
Meridian Bioscience, Inc. 349,446     4,734,993
Neogen Corp. * 192,992     12,712,383
Quidel Corp. * 404,254     12,932,086
        30,379,462
HEALTH CARE TECHNOLOGY—10.3%            
Medidata Solutions, Inc. * 252,355     19,383,388
Veeva Systems, Inc. , Cl. A* 310,594     19,803,473
Vocera Communications, Inc. * 390,325     10,644,163
        49,831,024

 

- 28 -

 

THE ALGER FUNDS | ALGER SMALL CAP FOCUS FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES         VALUE
HUMAN RESOURCE & EMPLOYMENT SERVICES—3.0%              
WageWorks, Inc. * 224,272   $ 14,622,534
INDUSTRIAL MACHINERY—4.4%              
DMC Global, Inc. 293,154         4,074,841
Proto Labs, Inc. * 103,382         7,639,930
Sun Hydraulics Corp. 234,776         9,710,335
          21,425,106
INTERNET SOFTWARE & SERVICES—8.5%              
Cornerstone OnDemand, Inc. * 180,625         7,280,994
NIC, Inc. 386,399         6,278,984
Shopify, Inc. , Cl. A* 141,773         13,095,572
SPS Commerce, Inc. * 106,599         6,161,422
Stamps. com, Inc. * 54,519         8,074,264
          40,891,236
LIFE SCIENCES TOOLS & SERVICES—2.3%              
Bio-Techne Corp. 94,740     10,981,313
MANAGED HEALTH CARE—1.9%              
HealthEquity, Inc. * 198,315         9,096,709
PERSONAL PRODUCTS—1.5%              
elf Beauty, Inc. * 274,854         6,973,046
RESTAURANTS—1.2%              
Wingstop, Inc. 188,030         5,642,780
SEMICONDUCTORS—1.9%              
Cavium Networks, Inc. * 149,172         9,239,714
SPECIALTY CHEMICALS—1.7%              
Balchem Corp. 103,740         8,050,224
SYSTEMS SOFTWARE—2.8%              
Proofpoint, Inc. * 158,992     13,552,478
TOTAL COMMON STOCKS              
       (Cost $410,310,501)         478,822,442
RIGHTS—0.0%   SHARES         VALUE
BIOTECHNOLOGY—0.0%              
Tolero Pharmaceuticals, Inc. , CDR@,(a) 11,905         27,474
       (Cost $6,436)             27,474
Total Investments              
       (Cost $410,316,937)(b) 99.4 %   478,849,916
Other Assets in Excess of Liabilities 0.6 %       3,050,376
NET ASSETS 100.0 %   $   481,900,292

 

* Non-income producing security.

- 29 -

 

THE ALGER FUNDS | ALGER SMALL CAP FOCUS FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

@ Restricted security - Investment in security not registered under the Securities Act of 1933. The investment is
deemed to not be liquid and may be sold only to qualified buyers.

        % of net assets       % of net assets  
  Acquisition     (Acquisition     Market as of  
Security Date(s)   Cost Date)     Value 7/31/2017  
Tolero Pharmaceuticals, Inc. ,                  
CDR 01/11/17 $ 6,436 0.04 % $ 27,474 0.01 %
Total           $ 27,474 0.01 %
                   

 

(a) Deemed an affiliate of the Alger fund complex during the year for purposes of Section 2(a)(3) of the
Investment Company Act of 1940. See Affiliated Securities in Notes to Financial Statements.
(b) At July 31, 2017, the net unrealized appreciation on investments, based on cost for federal income tax
purposes of $411,365,902, amounted to $67,484,014 which consisted of aggregate gross unrealized
appreciation of $76,518,314 and aggregate gross unrealized depreciation of $9,034,300.

See Notes to Financial Statements

- 30 -

 

THE ALGER FUNDS | ALGER HEALTH SCIENCES FUND
Schedule of Investments July 31, 2017 (Unaudited)

COMMON STOCKS—91.1%   SHARES       VALUE
BIOTECHNOLOGY—36.6%            
ACADIA Pharmaceuticals, Inc. * 22,000 $ 654,940
Agenus, Inc. * 66,000     293,040
Alexion Pharmaceuticals, Inc. * 25,000     3,433,500
Amicus Therapeutics, Inc. * 110,000     1,424,500
Axovant Sciences Ltd* 11,500     263,580
Bavarian Nordic A/S* 7,950     520,372
Bellicum Pharmaceuticals, Inc. * 48,000     507,840
Biogen, Inc. * 5,500     1,592,745
BioMarin Pharmaceutical, Inc. * 41,500     3,640,795
Bioverativ, Inc. * 19,000     1,177,430
Bluebird Bio, Inc. * 22,500     2,120,625
Blueprint Medicines Corp. * 5,000     261,650
Calithera Biosciences, Inc. * 23,000     351,900
Celgene Corp. * 25,000     3,385,250
Clovis Oncology, Inc. * 32,247     2,734,868
Curis, Inc. * 45,000     87,750
CytomX Therapeutics, Inc. * 11,000     148,390
Exact Sciences Corp. * 41,000     1,590,800
Exelixis, Inc. * 29,000     786,190
Five Prime Therapeutics, Inc. * 15,000     422,100
Flexion Therapeutics, Inc. * 10,000     228,000
Genmab A/S* 7,500     1,704,327
Halozyme Therapeutics, Inc. * 160,000     2,028,800
Ignyta, Inc. * 32,000     304,000
Incyte Corp. * 36,500     4,865,085
Kite Pharma, Inc. * 16,000     1,734,560
Ra Pharmaceuticals, Inc. * 33,000     485,430
Radius Health, Inc. * 12,000     528,360
Regeneron Pharmaceuticals, Inc. * 6,000     2,949,720
Repligen Corp* 36,000     1,449,720
Sage Therapeutics, Inc. * 9,009     718,468
Sarepta Therapeutics, Inc. * 70,000     2,700,600
Spark Therapeutics, Inc. * 21,000     1,491,000
TESARO, Inc. * 15,500     1,978,730
Vertex Pharmaceuticals, Inc. * 39,000     5,920,980
        54,486,045
HEALTH CARE DISTRIBUTORS—0.3%            
AmerisourceBergen Corp. , Cl. A 3,500     328,370
PetIQ, Inc. * 3,000     69,840
          398,210
HEALTH CARE EQUIPMENT—15.2%            
ABIOMED, Inc. * 28,500     4,220,565
Baxter International, Inc. 26,000     1,572,480
Boston Scientific Corp. * 26,000     692,120
DexCom, Inc. * 23,000     1,532,030
Edwards Lifesciences Corp. * 20,000     2,303,600
Glaukos Corp. * 21,000     843,780
Heska Corp. * 2,000     219,080

 

- 31 -

 

THE ALGER FUNDS | ALGER HEALTH SCIENCES FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES       VALUE
HEALTH CARE EQUIPMENT—(CONT. )            
IDEXX Laboratories, Inc. * 20,000 $ 3,329,200
Insulet Corp. * 35,000     1,760,850
Intuitive Surgical, Inc. * 1,600     1,501,216
Masimo Corp. * 15,500     1,466,300
Obalon Therapeutics, Inc. * 46,795     397,757
Stryker Corp. 19,000     2,794,900
        22,633,878
HEALTH CARE FACILITIES—0.4%            
Surgery Partners, Inc. * 28,000     555,800
HEALTH CARE SERVICES—1.0%            
BioTelemetry, Inc. * 12,000     410,400
Tivity Health, Inc. * 26,530     1,051,915
          1,462,315
HEALTH CARE SUPPLIES—3.3%            
Align Technology, Inc. * 17,500     2,926,525
Merit Medical Systems Inc. * 16,000     656,000
West Pharmaceutical Services, Inc. 15,000     1,330,500
          4,913,025
HEALTH CARE TECHNOLOGY—3.0%            
Agilent Technologies, Inc. 30,000     1,793,700
Cotiviti Holdings, Inc. * 7,000     301,350
Medidata Solutions, Inc. * 10,500     806,505
Veeva Systems, Inc. , Cl. A* 25,000     1,594,000
          4,495,555
LIFE SCIENCES TOOLS & SERVICES—4.3%            
Charles River Laboratories International, Inc. * 3,500     343,700
Illumina, Inc. * 15,500     2,694,675
Mettler-Toledo International, Inc. * 3,400     1,948,472
NanoString Technologies, Inc. * 45,000     684,450
PRA Health Sciences, Inc. * 6,500     483,600
QIAGEN N. V. 9,000     295,560
          6,450,457
MANAGED HEALTH CARE—10.2%            
Aetna, Inc. 14,000     2,160,340
Cigna Corp. 13,000     2,256,280
Humana, Inc. 12,500     2,890,000
UnitedHealth Group, Inc. 33,500     6,425,635
WellCare Health Plans, Inc. * 8,000     1,415,920
        15,148,175
PHARMACEUTICALS—16.8%            
AbbVie, Inc. 25,000     1,747,750
Aerie Pharmaceuticals, Inc. * 40,000     2,172,000
Allergan PLC. 8,000     2,018,640
AstraZeneca PLC. # 15,000     452,700
Bristol-Myers Squibb Co. 80,000     4,552,000
Dermira, Inc. * 36,000     991,080
Eli Lilly & Co. 10,000     826,600
Emmaus Life Sciences, Inc. *,@ 479,063     3,724,140

 

- 32 -

 

THE ALGER FUNDS | ALGER HEALTH SCIENCES FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES         VALUE
PHARMACEUTICALS—(CONT. )              
GW Pharmaceuticals PLC. #* 6,500     $   726,570
Intra-Cellular Therapies, Inc. * 13,000         150,410
Johnson & Johnson 23,000         3,052,560
Merck & Co. , Inc. 13,000         830,440
Novo Nordisk A/S# 26,000         1,102,400
Prothena Corp. , PLC. * 1,500         92,640
Supernus Pharmaceuticals, Inc. * 16,500         667,425
Zoetis, Inc. 30,000         1,875,600
          24,982,955
TOTAL COMMON STOCKS              
(Cost $106,285,607)         135,526,415
PREFERRED STOCKS—2.6%   SHARES         VALUE
BIOTECHNOLOGY—2.3%              
Prosetta Biosciences, Inc. , Series D*,@,(a) 897,366         3,418,964
PHARMACEUTICALS—0.3%              
Intarcia Therapeutics, Inc. , Series DD*,@ 7,546         443,177
TOTAL PREFERRED STOCKS              
(Cost $4,282,562)             3,862,141
RIGHTS—4.0%   SHARES         VALUE
BIOTECHNOLOGY—3.1%              
Dyax Corp. *,@ 21,800         61,912
Neuralstem, Inc. , 1/8/2019*,@ 26,472         –
Tolero Pharmaceuticals, Inc. , CDR@,(a) 1,956,996         4,516,355
              4,578,267
PHARMACEUTICALS—0.9%              
Emmaus Life Sciences, Inc. , 9/11/2018*,@ 320,000         1,367,616
TOTAL RIGHTS              
(Cost $1,044,373)             5,945,883
Total Investments              
(Cost $111,612,542)(b) 97.7 %   145,334,439
Other Assets in Excess of Liabilities 2.3 %       3,382,252
NET ASSETS 100.0 %   $   148,716,691

 

* Non-income producing security.
# American Depositary Receipts.

- 33 -

 

THE ALGER FUNDS | ALGER HEALTH SCIENCES FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

@ Restricted security - Investment in security not registered under the Securities Act of 1933. The investment is
deemed to not be liquid and may be sold only to qualified buyers.

        % of net assets       % of net assets  
  Acquisition     (Acquisition     Market as of  
Security Date(s)   Cost Date)     Value 7/31/2017  
Dyax Corp. 04/01/15 $ 0 0.00 % $ 60,634 0.04 %
Dyax Corp. 10/15/15   0 0.00 %   1,278 0.00 %
Emmaus Life Sciences, Inc. 09/09/13   800,000 0.42 %   2,487,616 1.67 %
Emmaus Life Sciences, Inc. 06/06/14   556,721 0.28 %   1,236,524 . 83 %
Emmaus Life Sciences, Inc. ,                  
Rights 09/09/13   0 0.00 %   1,367,616 0.92 %
Intarcia Therapeutics, Inc. , Series                  
DD 03/27/14   244,415 0.15 %   443,177 0.29 %
Neuralstem, Inc. 01/03/14   0 0 %   0 0.00 %
Prosetta Biosciences, Inc. , Series                  
D 02/06/15   4,038,147 2.00 %   3,418,964 2.30 %
Tolero Pharmaceuticals, Inc. ,                  
CDR 01/11/17   1,044,373 0.52 %   4,516,355 3.04 %
Total           $ 13,532,164 9.09 %
                   

 

(a) Deemed an affiliate of the Alger fund complex during the year for purposes of Section 2(a)(3) of the
Investment Company Act of 1940. See Affiliated Securities in Notes to Financial Statements.
(b) At July 31, 2017, the net unrealized appreciation on investments, based on cost for federal income tax
purposes of $112,946,614, amounted to $32,387,825 which consisted of aggregate gross unrealized
appreciation of $36,966,631 and aggregate gross unrealized depreciation of $4,578,806.

See Notes to Financial Statements

- 34 -

 

THE ALGER FUNDS | ALGER GROWTH & INCOME FUND
Schedule of Investments July 31, 2017 (Unaudited)

COMMON STOCKS—91.2%   SHARES     VALUE
AEROSPACE & DEFENSE—3.4%          
General Dynamics Corp. 7,556 $ 1,483,469
The Boeing Co. 10,004   2,425,570
        3,909,039
AIR FREIGHT & LOGISTICS—0.4%          
United Parcel Service, Inc. , Cl. B 4,399   485,166
AIRPORT SERVICES—0.5%          
Macquarie Infrastructure Corp. 8,137   616,866
APPAREL RETAIL—0.6%          
The Gap, Inc. 26,419   629,565
ASSET MANAGEMENT & CUSTODY BANKS—1.6%          
BlackRock, Inc. 4,284   1,827,254
AUTO PARTS & EQUIPMENT—0.8%          
Delphi Automotive PLC. 10,328   933,858
BIOTECHNOLOGY—1.3%          
Amgen, Inc. 4,100   715,491
Gilead Sciences, Inc. 9,700   738,073
        1,453,564
BREWERS—0.6%          
Molson Coors Brewing Co. , Cl. B 7,489   666,371
BUILDING PRODUCTS—1.1%          
Johnson Controls International PLC. 31,280   1,218,356
CABLE & SATELLITE—2.4%          
Comcast Corporation, Cl. A 66,582   2,693,242
COMMUNICATIONS EQUIPMENT—1.2%          
Cisco Systems, Inc. 43,199   1,358,609
CONSUMER ELECTRONICS—0.5%          
Garmin Ltd. 11,100   557,109
CONSUMER FINANCE—0.5%          
Discover Financial Services 9,386   571,983
DIVERSIFIED BANKS—4.8%          
JPMorgan Chase & Co. 42,602   3,910,863
Wells Fargo & Co. 28,454   1,534,809
        5,445,672
DIVERSIFIED CHEMICALS—1.0%          
The Dow Chemical Co. * 17,320   1,112,637
DRUG RETAIL—1.5%          
CVS Caremark Corp. 15,600   1,246,908
Walgreens Boots Alliance, Inc. 6,100   492,087
        1,738,995
ELECTRICAL COMPONENTS & EQUIPMENT—0.6%          
Eaton Corp. , PLC. 9,500   743,375
FINANCIAL EXCHANGES & DATA—1.5%          
CME Group, Inc. 13,763   1,687,619
HEALTH CARE EQUIPMENT—0.9%          
Becton Dickinson and Co. 5,100   1,027,140
HOME IMPROVEMENT RETAIL—2.0%          
The Home Depot, Inc. 15,200   2,273,920

 

- 35 -

 

THE ALGER FUNDS | ALGER GROWTH & INCOME FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES     VALUE
HOTELS RESORTS & CRUISE LINES—1.5%          
Extended Stay America, Inc. 37,604 $ 743,431
Royal Caribbean Cruises Ltd. 8,400   949,788
        1,693,219
HOUSEHOLD PRODUCTS—1.5%          
The Procter & Gamble Co. 18,860   1,712,865
HYPERMARKETS & SUPER CENTERS—0.8%          
Wal-Mart Stores, Inc. 11,700   935,883
INDUSTRIAL CONGLOMERATES—3.8%          
General Electric Co. 68,347   1,750,366
Honeywell International, Inc. 19,156   2,607,515
        4,357,881
INDUSTRIAL GASES—0.6%          
Air Products & Chemicals, Inc. 4,609   655,169
INTEGRATED OIL & GAS—3.3%          
Exxon Mobil Corp. 33,028   2,643,561
TOTAL SA# 23,119   1,171,440
        3,815,001
INTEGRATED TELECOMMUNICATION SERVICES—3.0%          
AT&T, Inc. 30,300   1,181,700
Verizon Communications, Inc. 45,395   2,197,118
        3,378,818
INTERNET RETAIL—0.6%          
Amazon. com, Inc. * 640   632,179
INTERNET SOFTWARE & SERVICES—4.9%          
Alphabet, Inc. , Cl. A* 2,005   1,895,727
Alphabet, Inc. , Cl. C* 2,010   1,870,305
Facebook, Inc. , Cl. A* 10,900   1,844,825
        5,610,857
INVESTMENT BANKING & BROKERAGE—2.2%          
Morgan Stanley 54,020   2,533,538
LEISURE FACILITIES—0.5%          
Six Flags Entertainment Corp. 10,410   592,017
LEISURE PRODUCTS—1.0%          
Coach, Inc. 16,537   779,554
Mattel, Inc. 17,300   346,346
        1,125,900
MANAGED HEALTH CARE—3.1%          
Aetna, Inc. 11,549   1,782,126
UnitedHealth Group, Inc. 8,912   1,709,411
        3,491,537
MOVIES & ENTERTAINMENT—0.9%          
Time Warner, Inc. 10,000   1,024,200
MULTI-LINE INSURANCE—0.8%          
Hartford Financial Services Group, Inc. 16,900   929,500
MULTI-UTILITIES—0.8%          
Sempra Energy 7,991   903,063
OIL & GAS EQUIPMENT & SERVICES—0.7%          
Halliburton Company 19,500   827,580

 

- 36 -

 

THE ALGER FUNDS | ALGER GROWTH & INCOME FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

COMMON STOCKS—(CONT. )   SHARES         VALUE
OIL & GAS EXPLORATION & PRODUCTION—0.7%              
ConocoPhillips 17,676 $   801,960
OTHER DIVERSIFIED FINANCIAL SERVICES—1.5%              
Bank of America Corp. 69,555       1,677,667
PACKAGED FOODS & MEATS—0.7%              
The Kraft Heinz Co. 8,600       752,156
PHARMACEUTICALS—8.3%              
Bristol-Myers Squibb Co. 28,880       1,643,272
Eli Lilly & Co. 20,500       1,694,530
GlaxoSmithKline PLC. # 21,339       864,656
Johnson & Johnson 20,000       2,654,400
Pfizer, Inc. 62,024       2,056,716
Roche Holding AG# 17,055       540,695
            9,454,269
RAILROADS—0.7%              
CSX Corp. 17,130       845,194
RESTAURANTS—1.9%              
Darden Restaurants, Inc. 8,100       679,428
McDonald's Corp. 9,800       1,520,372
            2,199,800
SEMICONDUCTOR EQUIPMENT—1.1%              
Kla-Tencor Corp. 13,444       1,245,318
SEMICONDUCTORS—4.2%              
Broadcom Ltd. 10,900       2,688,594
Intel Corp. 42,000       1,489,740
QUALCOMM, Inc. 12,100       643,599
            4,821,933
SOFT DRINKS—2.9%              
PepsiCo, Inc. 20,247       2,361,003
The Coca-Cola Co. 20,700       948,888
            3,309,891
SYSTEMS SOFTWARE—4.2%              
Choicestream, Inc. *,@,(a) 5,064       –
Microsoft Corp. 66,604       4,842,111
            4,842,111
TECHNOLOGY HARDWARE STORAGE & PERIPHERALS—5.6%              
Apple, Inc. 33,935       5,047,152
Western Digital Corp. 15,758       1,341,321
            6,388,473
TOBACCO—2.2%              
Altria Group, Inc. 39,079       2,538,963
TOTAL COMMON STOCKS              
        (Cost $63,164,736)         104,047,282
CONVERTIBLE PREFERRED STOCKS—0.6%   SHARES         VALUE
PHARMACEUTICALS—0.6%              
Allergan PLC. , 5.50%, 3/1/2018* 770       688,388
       (Cost $770,000)             688,388

 

- 37 -

 

THE ALGER FUNDS | ALGER GROWTH & INCOME FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

PREFERRED STOCKS—–%   SHARES         VALUE
SYSTEMS SOFTWARE—–%              
Choicestream, Inc. , Cl. A*,@,(a) 43,672     $   –
Choicestream, Inc. , Cl. B*,@,(a) 89,234         –
              –
TOTAL PREFERRED STOCKS              
(Cost $88,465)              –
WARRANTS—–%   SHARES         VALUE
SYSTEMS SOFTWARE—–%              
Choicestream, Inc. , 6/22/26@,(a) 15,285         –
(Cost $15,269)              –
MASTER LIMITED PARTNERSHIP—1.9%   SHARES         VALUE
ASSET MANAGEMENT & CUSTODY BANKS—1.5%              
The Blackstone Group LP. 50,400         1,685,880
OIL & GAS STORAGE & TRANSPORTATION—0.4%              
Cheniere Energy Partners LP. 16,300         478,405
TOTAL MASTER LIMITED PARTNERSHIP              
(Cost $1,679,617)             2,164,285
REAL ESTATE INVESTMENT TRUST—3.1%   SHARES         VALUE
HEALTH CARE—0.7%              
Welltower, Inc. 11,100         814,629
MORTGAGE—0.6%              
Blackstone Mortgage Trust, Inc. , Cl. A 22,200         685,314
SPECIALIZED—1.8%              
Crown Castle International Corp. 11,257         1,132,229
Lamar Advertising Co. , Cl. A 12,600         889,182
              2,021,411
TOTAL REAL ESTATE INVESTMENT TRUST              
(Cost $2,848,793)             3,521,354
    PRINCIPAL          
CORPORATE BONDS—0.0%   AMOUNT         VALUE
SYSTEMS SOFTWARE—–%              
Choicestream, Inc. , 11.00%, 8/05/18@,(a) 15,285         –
(Cost $15)              –
Total Investments              
(Cost $68,566,895)(b) 96.8 %   110,421,309
Other Assets in Excess of Liabilities 3.2 %       3,613,375
NET ASSETS 100.0 %   $   114,034,684

 

- 38 -

 

THE ALGER FUNDS | ALGER GROWTH & INCOME FUND
Schedule of Investments July 31, 2017 (Unaudited) (Continued)

* Non-income producing security.
# American Depositary Receipts.
@ Restricted security - Investment in security not registered under the Securities Act of 1933. The investment is
deemed to not be liquid and may be sold only to qualified buyers.

        % of net assets       % of net assets  
  Acquisition     (Acquisition     Market as of  
Security Date(s)   Cost Date)     Value 7/31/2017  
Choicestream, Inc. 03/14/14 $ 1,468 0.00 % $ 0 0.00 %
Choicestream, Inc. , 11.00%,                  
8/05/18 08/04/16   15 0.00 %   0 0.00 %
Choicestream, Inc. , 6/22/26 08/04/16   15,269 0.02 %   0 0.00 %
Choicestream, Inc. , Cl. A 12/17/13   34,924 0.03 %   0 0.00 %
Choicestream, Inc. , Cl. B 07/10/14   53,541 0.05 %   0 0.00 %
Total           $ 0 0.00 %
                   

 

(a) Deemed an affiliate of the Alger fund complex during the year for purposes of Section 2(a)(3) of the
Investment Company Act of 1940. See Affiliated Securities in Notes to Financial Statements.
(b) At July 31, 2017, the net unrealized appreciation on investments, based on cost for federal income tax
purposes of $68,296,148, amounted to $42,125,161 which consisted of aggregate gross unrealized
appreciation of $43,422,998 and aggregate gross unrealized depreciation of $1,297,837.

See Notes to Financial Statements

- 39 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited)

NOTE 1 — General:
The Alger Funds (the “Trust”) is a diversified, open-end registered investment company
organized as a business trust under the laws of the Commonwealth of Massachusetts. The
Trust qualifies as an investment company as defined in the Financial Accounting Standards
Board Accounting Standards Codification 946-Financial Services – Investment Companies.
The Trust operates as a series company currently offering an unlimited number of shares
of beneficial interest in eight funds — Alger Capital Appreciation Fund, Alger International
Growth Fund, Alger Mid Cap Growth Fund, Alger SMid Cap Growth Fund, Alger Small
Cap Growth Fund, Alger Growth Opportunities Fund, Alger Health Sciences Fund and
Alger Growth & Income Fund (collectively, the “Funds” or individually, each a “Fund”).
The Alger Capital Appreciation Fund, Alger International Growth Fund, Alger Mid Cap
Growth Fund, Alger SMid Cap Growth Fund, Alger Small Cap Growth Fund, Alger
Growth Opportunities Fund and Alger Health Sciences Fund normally invest primarily in
equity securities and each has an investment objective of long-term capital appreciation.
The Alger Growth & Income Fund also invests primarily in equity securities but has an
investment objective of both capital appreciation and current income.

Each Fund offers one or more of the following share classes: Class A, B, C, I and Z. Class A
shares are generally subject to an initial sales charge while Class B and C shares are generally
subject to a deferred sales charge. Class B shares will automatically convert to Class A shares
eight years after the end of the calendar month in which the order to purchase was accepted.
The conversion is completed without the imposition of any sales charges or other fees.
Class I and Z shares are sold to institutional investors without an initial or deferred sales
charge. Each class has identical rights to assets and earnings, except that each share class
bears the pro rata allocation of the fund’s expense other than a class expense (not including
advisory or custodial fees or other expenses related to the management of the fund’s assets)
to a share class.

NOTE 2 — Significant Accounting Policies:
(a) Investment Valuation: The Funds value their financial instruments at fair value using
independent dealers or pricing services under policies approved by the Board of Trustees.
Investments are valued on each day the New York Stock Exchange (the “NYSE”) is open,
as of the close of the NYSE (normally 4:00 p.m. Eastern Standard Time).
Equity securities and option contracts for which valuation information is readily available are
valued at the last quoted sales price or official closing price as reported by an independent
pricing service on the primary market or exchange on which they are traded. In the absence
of quoted sales, such securities are valued at the bid price or, in the absence of a recent
bid price, the equivalent as obtained from one or more of the major market makers for the
securities to be valued.

The industry classifications of the Funds’ investments, as presented in the accompanying
Schedules of Investments, represent Management’s belief as to the most meaningful
presentation of the classification of such investments. For Fund compliance purposes, the
Funds’ industry classifications refer to any one or more of the industry sub-classifications
- 40 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

used by one or more widely recognized market indexes or rating group indexes, with the
primary source being Global Industry Classification Standard (GICS).

Debt securities generally trade in the over-the-counter market. Debt securities with
remaining maturities of more than sixty days at the time of acquisition are valued on
the basis of last available bid prices or current market quotations provided by dealers
or pricing services. In determining the value of a particular investment, pricing services
may use certain information with respect to transactions in such investments, quotations
from dealers, pricing matrixes, market transactions in comparable investments, various
relationships observed in the market between investments and calculated yield measures
based on valuation technology commonly employed in the market for such investments.
Asset-backed and mortgage-backed securities are valued by independent pricing services
using models that consider estimated cash flows of each tranche of the security, establish a
benchmark yield and develop an estimated tranche-specific spread to the benchmark yield
based on the unique attributes of the tranche. Debt securities with a remaining maturity of
sixty days or less are valued at amortized cost which approximates market value.

Securities for which market quotations are not readily available are valued at fair value, as
determined in good faith pursuant to procedures established by the Board of Trustees.

Securities in which the Funds invest may be traded in foreign markets that close before the
close of the NYSE. Developments that occur between the close of the foreign markets and
the close of the NYSE may result in adjustments to the closing foreign prices to reflect what
the investment manager, pursuant to policies established by the Board of Trustees, believes
to be the fair value of these securities as of the close of the NYSE. The Funds may also fair
value securities in other situations, for example, when a particular foreign market is closed
but the Fund is open.

Financial Accounting Standards Board Accounting Standards Codification 820 – Fair Value
Measurements and Disclosures (“ASC 820”) defines fair value as the price that the Funds
would receive upon selling an investment in a timely transaction to an independent buyer
in the principal or most advantageous market of the investment. ASC 820 established a
three-tier hierarchy to maximize the use of observable market data and minimize the use of
unobservable inputs and to establish classification of fair value measurements for disclosure
purposes. Inputs refer broadly to the assumptions that market participants would use in
pricing the asset or liability and may be observable or unobservable. Observable inputs
are based on market data obtained from sources independent of the Funds. Unobservable
inputs are inputs that reflect the Funds’ own assumptions based on the best information
available in the circumstances. The three-tier hierarchy of inputs is summarized in the three
broad Levels listed below.

• Level 1 – quoted prices in active markets for identical investments
• Level 2 – significant other observable inputs (including quoted prices for similar
investments, interest rates, prepayment speeds, credit risk, etc.)
• Level 3 – significant unobservable inputs (including the Funds’ own assumptions in
determining the fair value of investments)
- 41 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

The Funds’ valuation techniques are generally consistent with either the market or the
income approach to fair value. The market approach considers prices and other relevant
information generated by market transactions involving identical or comparable assets
to measure fair value. The income approach converts future amounts to a current, or
discounted, single amount. These fair value measurements are determined on the basis
of the value indicated by current market expectations about such future events. Inputs
for Level 1 include exchange-listed prices and broker quotes in an active market. Inputs
for Level 2 include the last trade price in the case of a halted security, an exchange-listed
price which has been adjusted for fair value factors, and prices of closely related securities.
Additional Level 2 inputs include an evaluated price which is based upon a compilation of
observable market information such as spreads for fixed income and preferred securities.
Inputs for Level 3 include revenue multiples, earnings before interest, taxes, depreciation
and amortization (“EBITDA”) multiples, discount rates, and the probabilities of success of
certain outcomes. Such unobservable market information may be obtained from a company’s
financial statements and from industry studies, market data, and market indicators such as
benchmarks and indices.

Because of the inherent uncertainty and often limited markets for restricted securities, the
values may significantly differ from the values if there was an active market.

Valuation processes are determined by a Valuation Committee (“Committee”) established
by the Trust’s Board of Trustees (“Board”) and comprised of representatives of the Trust’s
investment advisor. The Committee reports its fair valuation determinations to the Board
which is responsible for approving valuation policy and procedures.

While the Committee meets on an as-needed basis, the Committee formally meets
quarterly to review and evaluate the effectiveness of the procedures for making fair value
determinations. The Committee considers, among other things, the results of quarterly
back testing of the fair value model for foreign securities, pricing comparisons between
primary and secondary price sources, the outcome of price challenges put to the Funds’
pricing vendor, and variances between transactional prices and previous mark-to-markets.

The Funds will record a change to a security’s fair value level if new inputs are available or
it becomes evident that inputs previously considered for leveling have changed or are no
longer relevant. Transfers between Levels 1 and 2 are recognized at the end of the reporting
period, and transfers into and out of Level 3 are recognized during the reporting period.

(b) Cash and Cash Equivalents: Cash and cash equivalents include U.S. dollars, foreign cash
and overnight time deposits.
NOTE 3 — Fair Value Measurements:
The following is a summary of the inputs used as of July 31, 2017 in valuing the Funds’
investments carried at fair value on a recurring basis. Based upon the nature, characteristics,
and risks associated with their investments, the Funds have determined that presenting them
by security type and sector is appropriate.

- 42 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

Alger Capital Appreciation Fund     TOTAL FUND     LEVEL 1           LEVEL 2   LEVEL 3
COMMON STOCKS                              
Consumer Discretionary $ 497,883,906 $ 497,883,906       — —
Consumer Staples   84,840,081   84,840,081       — —
Energy   47,930,873   47,930,873       — —
Financials   122,587,453   122,587,453       — —
Health Care   399,777,551   399,777,551       — —
Industrials   158,448,490   158,448,490       — —
Information Technology   1,198,652,113    

1,197,720,158

         —   931,955
Materials   49,197,092   49,197,092       — —
Telecommunication Services   12,528,202   12,528,202       — —
TOTAL COMMON STOCKS $ 2,571,845,761 $   2,570,913,806         — $ 931,955
CORPORATE BONDS                              
Information Technology   —   —       — —
MASTER LIMITED PARTNERSHIP                              
Financials   31,477,085   31,477,085       — —
PREFERRED STOCKS                              
Health Care     4,503,534   —       —   4,503,534
Information Technology     4,295,976   —       —   4,295,976
TOTAL PREFERRED STOCKS $ 8,799,510   —       — $ 8,799,510
REAL ESTATE INVESTMENT TRUST                            
Real Estate   53,382,202   53,382,202       — —
WARRANTS                              
Information Technology   —   —       — —
TOTAL INVESTMENTS IN                              
         SECURITIES   $  2,665,504,558 $   2,655,773,093         — $ 9,731,465
 
Alger International Growth Fund     TOTAL FUND     LEVEL 1           LEVEL 2   LEVEL 3
COMMON STOCKS                              
Consumer Discretionary $ 18,249,197   $ 903,400 $ 17,345,797 —
Consumer Staples   11,568,860     4,154,075         7,414,785 —
Energy     9,325,177     6,747,754         2,577,423 —
Financials   43,686,554     8,383,709       35,302,845 —
Health Care   10,759,319     1,882,454         8,876,865 —
Industrials   24,976,870     1,895,929       23,080,941 —
Information Technology   36,892,341   13,640,085       23,252,256 —
Materials     8,638,624     592,932         8,045,692 —
Real Estate     1,422,185   —         1,422,185 —
Telecommunication Services     3,743,134   —         3,743,134 —
Utilities     1,418,869   —         1,418,869 —
TOTAL COMMON STOCKS $ 170,681,130 $ 38,200,338 $ 132,480,792 —
TOTAL INVESTMENTS IN                              
            SECURITIES $ 170,681,130 $ 38,200,338 $ 132,480,792 —

 

- 43 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

Alger Mid Cap Growth Fund     TOTAL FUND     LEVEL 1     LEVEL 2   LEVEL 3
COMMON STOCKS                          
Consumer Discretionary $ 25,013,340 $ 25,013,340   — —
Consumer Staples     5,774,746     5,774,746   — —
Energy     2,263,506     2,263,506   — —
Financials   12,117,125   12,117,125   — —
Health Care   38,096,100   38,096,100   — —
Industrials   20,631,900   20,631,900   — —
Information Technology   51,690,506   51,590,940   —   99,566
Materials     7,137,283     7,137,283   — —
TOTAL COMMON STOCKS

$

162,724,506 $ 162,624,940   — $ 99,566
PREFERRED STOCKS                          
Health Care     836,714   —   —   836,714
Information Technology     458,967   —   —   458,967
TOTAL PREFERRED STOCKS $ 1,295,681   —   — $ 1,295,681
REAL ESTATE INVESTMENT TRUST                        
Real Estate     6,361,591     6,361,591   — —
RIGHTS                          
Health Care     1,361,738   —   —   1,361,738
SPECIAL PURPOSE VEHICLE                          
Financials     357,727   —   —   357,727
TOTAL INVESTMENTS IN                          
       SECURITIES $ 172,101,243 $ 168,986,531   — $ 3,114,712
 
Alger SMid Cap Focus Fund     TOTAL FUND     LEVEL 1     LEVEL 2   LEVEL 3
COMMON STOCKS                          
Consumer Discretionary $ 23,223,965 $ 23,223,965   — —
Financials   12,414,411   12,414,411   — —
Health Care   29,439,942   29,439,942   — —
Industrials   23,902,357   23,902,357   — —
Information Technology   56,817,535   56,323,170   —   494,365
Real Estate     7,245,569     7,245,569   — —
TOTAL COMMON STOCKS $ 153,043,779 $ 152,549,414   — $ 494,365
PREFERRED STOCKS                          
Health Care     3,778,303   —   —   3,778,303
Information Technology     2,278,845   —   —   2,278,845
TOTAL PREFERRED STOCKS $ 6,057,148   —   — $ 6,057,148
RIGHTS                          
Health Care     106,642   —   —   106,642
TOTAL INVESTMENTS IN                          
        SECURITIES $ 159,207,569 $ 152,549,414   — $ 6,658,155

 

- 44 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

Alger Small Cap Growth Fund     TOTAL FUND     LEVEL 1     LEVEL 2   LEVEL 3
COMMON STOCKS                          
Consumer Discretionary $ 7,588,540   $ 7,588,540   — —
Consumer Staples     3,744,711     3,744,711   — —
Energy     1,476,901     1,476,901   — —
Financials     6,209,721     6,209,721   — —
Health Care   49,996,223   49,996,223   — —
Industrials   10,666,983   10,666,983   — —
Information Technology   46,587,070   46,587,070   — —
Materials     3,024,885     3,024,885   — —
TOTAL COMMON STOCKS $ 129,295,034 $ 129,295,034   — —
PREFERRED STOCKS                          
Health Care     193,121   —   —   193,121
REAL ESTATE INVESTMENT TRUST                        
Real Estate     1,353,029     1,353,029   — —
RIGHTS                          
Health Care     430,910   —   —   430,910
SPECIAL PURPOSE VEHICLE                          
Financials     329,471   —   —   329,471
TOTAL INVESTMENTS IN                          
        SECURITIES $ 131,601,565 $ 130,648,063   — $ 953,502
Alger Small Cap Focus Fund     TOTAL FUND     LEVEL 1     LEVEL 2   LEVEL 3
COMMON STOCKS                          
Consumer Discretionary $ 5,642,780   $ 5,642,780   — —
Consumer Staples     6,973,046     6,973,046   — —
Financials   27,760,440   27,760,440   — —
Health Care   199,810,817   199,810,817   — —
Industrials   36,047,640   36,047,640   — —
Information Technology   194,537,495   194,537,495   — —
Materials     8,050,224     8,050,224   — —
TOTAL COMMON STOCKS $ 478,822,442 $ 478,822,442   — —
RIGHTS                          
Health Care     27,474   —   —   27,474
TOTAL INVESTMENTS IN                          
         SECURITIES $ 478,849,916 $ 478,822,442   — $ 27,474

 

- 45 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

Alger Health Sciences Fund     TOTAL FUND     LEVEL 1   LEVEL 2   LEVEL 3
COMMON STOCKS                      
Health Care $ 135,526,415 $ 129,577,576 $ 2,224,699 $ 3,724,140
PREFERRED STOCKS                      
Health Care     3,862,141   — —   3,862,141
RIGHTS                      
Health Care     5,945,883   — —   5,945,883
TOTAL INVESTMENTS IN                      
SECURITIES $ 145,334,439 $ 129,577,576 $ 2,224,699 $ 13,532,164
 
Alger Growth & Income Fund     TOTAL FUND     LEVEL 1   LEVEL 2   LEVEL 3
COMMON STOCKS                      
Consumer Discretionary $  14,355,009 $ 14,355,009 — —
Consumer Staples   11,655,124   11,655,124 — —
Energy     5,444,541     5,444,541 — —
Financials   14,673,233   14,673,233 — —
Health Care   15,426,510   15,426,510 — —
Industrials   12,175,877   12,175,877 — —
Information Technology   24,267,301   24,267,301 — —
Materials     1,767,806     1,767,806 — —
Telecommunication Services     3,378,818     3,378,818 — —
Utilities     903,063     903,063 — —
TOTAL COMMON STOCKS $  104,047,282 $ 104,047,282 — —
CONVERTIBLE PREFERRED STOCKS                
Health Care     688,388     688,388 — —
CORPORATE BONDS                      
Information Technology   —   — — —
MASTER LIMITED PARTNERSHIP                      
Energy     478,405     478,405 — —
Financials     1,685,880     1,685,880 — —
TOTAL MASTER LIMITED                      
PARTNERSHIP $ 2,164,285   $ 2,164,285 — —
PREFERRED STOCKS                      
Information Technology   —   — — —
REAL ESTATE INVESTMENT TRUST                    
Financials     685,314     685,314 — —
Real Estate     2,836,040     2,836,040 — —
TOTAL REAL ESTATE                      
INVESTMENT TRUST $ 3,521,354   $ 3,521,354 — —
WARRANTS                      
Information Technology   —   — — —
TOTAL INVESTMENTS IN                      
SECURITIES $  110,421,309 $ 110,421,309 — —

 

- 46 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

    FAIR VALUE  
  MEASUREMENTS  
  USING SIGNIFICANT  
  UNOBSERVABLE  
  INPUTS (LEVEL 3)  
Alger Capital Appreciation Fund Common Stocks  
Opening balance at November 1, 2016 $ 1,172,607  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments –  
Included in net unrealized gain (loss) on investments (240,652 )
Purchases and sales –  
Purchases –  
Sales –  
Closing balance at July 31, 2017 931,955  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ (240,652 )
 
Alger Capital Appreciation Fund Corporate Bonds  
Opening balance at November 1, 2016 $ 387,502  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments –  
Included in net unrealized gain (loss) on investments (387,502 )
Purchases and sales –  
Purchases –  
Sales –  
Closing balance at July 31, 2017 0  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ (387,502 )
 
Alger Capital Appreciation Fund Preferred Stocks  
Opening balance at November 1, 2016 $ 10,752,714  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments –  
Included in net unrealized gain (loss) on investments (1,953,204 )
Purchases and sales –  
Purchases –  
Sales –  
Closing balance at July 31, 2017 8,799,510  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ (1,953,204 )

 

- 47 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

    FAIR VALUE  
  MEASUREMENTS  
  USING SIGNIFICANT  
  UNOBSERVABLE  
  INPUTS (LEVEL 3)  
Alger Capital Appreciation Fund     Warrants  
Opening balance at November 1, 2016 $ 379,752  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments –  
Included in net unrealized gain (loss) on investments (379,752 )
Purchases and sales –  
Purchases –  
Sales –  
Closing balance at July 31, 2017 0  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ (379,752 )
 
    FAIR VALUE  
  MEASUREMENTS  
  USING SIGNIFICANT  
  UNOBSERVABLE  
  INPUTS (LEVEL 3)  
Alger Mid Cap Growth Fund Common Stocks  
Opening balance at November 1, 2016 $ 125,276  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments –  
Included in net unrealized gain (loss) on investments (25,710 )
Purchases and sales –  
Purchases –  
Sales –  
Closing balance at July 31, 2017 99,566  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ (25,710 )

 

- 48 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

    FAIR VALUE  
  MEASUREMENTS  
  USING SIGNIFICANT  
  UNOBSERVABLE  
  INPUTS (LEVEL 3)  
Alger Mid Cap Growth Fund Preferred Stocks  
Opening balance at November 1, 2016 $ 2,103,258  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments 3,292,351  
Included in net unrealized gain (loss) on investments 261,923  
Purchases and sales –  
Purchases –  
Sales (4,361,851 )
Closing balance at July 31, 2017 1,295,681  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ 3,554,274  
 
Alger Mid Cap Growth Fund     Rights  
Opening balance at November 1, 2016 $ —  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments –  
Included in net unrealized gain (loss) on investments 1,046,236  
Purchases and sales –  
Purchases 315,502  
Sales –  
Closing balance at July 31, 2017 1,361,738  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ 1,046,236  
 
  Special Purpose  
Alger Mid Cap Growth Fund     Vehicle  
Opening balance at November 1, 2016 $ 327,271  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments –  
Included in net unrealized gain (loss) on investments 30,456  
Purchases and sales –  
Purchases –  
Sales –  
Closing balance at July 31, 2017 357,727  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ 30,456  

 

- 49 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

    FAIR VALUE  
  MEASUREMENTS  
  USING SIGNIFICANT  
  UNOBSERVABLE  
  INPUTS (LEVEL 3)  
Alger Small Cap Growth Fund Preferred Stocks  
Opening balance at November 1, 2016 $ 396,005  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments 971,747  
Included in net unrealized gain (loss) on investments 117,397  
Purchases and sales –  
Purchases –  
Sales (1,292,028 )
Closing balance at July 31, 2017 193,121  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ 1,089,144  
 
Alger Small Cap Growth Fund     Rights  
Opening balance at November 1, 2016 $ —  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments –  
Included in net unrealized gain (loss) on investments 336,427  
Purchases and sales –  
Purchases 94,483  
Sales –  
Closing balance at July 31, 2017 430,910  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ 336,427  

 

- 50 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

    FAIR VALUE  
  MEASUREMENTS  
  USING SIGNIFICANT  
  UNOBSERVABLE  
  INPUTS (LEVEL 3)  
  Special Purpose  
Alger Small Cap Growth Fund     Vehicle  
Opening balance at November 1, 2016 $ 301,420  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments –  
Included in net unrealized gain (loss) on investments 28,051  
Purchases and sales –  
Purchases –  
Sales –  
Closing balance at July 31, 2017 329,471  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ 28,051  
 
    FAIR VALUE  
  MEASUREMENTS  
  USING SIGNIFICANT  
  UNOBSERVABLE  
  INPUTS (LEVEL 3)  
Alger Small Cap Focus Fund Preferred Stocks  
Opening balance at November 1, 2016 $ 56,319  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments 82,330  
Included in net unrealized gain (loss) on investments (9,920 )
Purchases and sales –  
Purchases –  
Sales (128,729 )
Closing balance at July 31, 2017 0  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ 72,410  

 

- 51 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

    FAIR VALUE
  MEASUREMENTS
  USING SIGNIFICANT
  UNOBSERVABLE
  INPUTS (LEVEL 3)
Alger Small Cap Focus Fund     Rights
Opening balance at November 1, 2016 $ —
Transfers into Level 3 —
Transfers out of Level 3 —
Total gains or losses      
Included in net realized gain (loss) on investments –
Included in net unrealized gain (loss) on investments 21,038
Purchases and sales –
Purchases 6,436
Sales –
Closing balance at July 31, 2017 27,474
The amount of total gains or losses for the period included in net realized      
and unrealized gain (loss) attributable to change in unrealized appreciation      
(depreciation) relating to investments still held at 7/31/2017 $ 21,038
 
    FAIR VALUE
  MEASUREMENTS
  USING SIGNIFICANT
  UNOBSERVABLE
  INPUTS (LEVEL 3)
Alger Health Sciences Fund Common Stocks
Opening balance at November 1, 2016 $ 143,719
Transfers into Level 3 —
Transfers out of Level 3 —
Total gains or losses      
Included in net realized gain (loss) on investments –
Included in net unrealized gain (loss) on investments 3,580,421
Purchases and sales –
Purchases –
Sales –
Closing balance at July 31, 2017 3,724,140
The amount of total gains or losses for the period included in net realized      
and unrealized gain (loss) attributable to change in unrealized appreciation      
(depreciation) relating to investments still held at 7/31/2017 $ 3,580,421

 

- 52 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

    FAIR VALUE  
  MEASUREMENTS  
  USING SIGNIFICANT  
  UNOBSERVABLE  
  INPUTS (LEVEL 3)  
Alger Health Sciences Fund Preferred Stocks  
Opening balance at November 1, 2016 $ 6,250,448  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments 10,958,392  
Included in net unrealized gain (loss) on investments 1,197,906  
Purchases and sales –  
Purchases –  
Sales (14,544,605 )
Closing balance at July 31, 2017 3,862,141  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ 12,156,298  
 
Alger Health Sciences Fund     Rights  
Opening balance at November 1, 2016 $ —  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments –  
Included in net unrealized gain (loss) on investments 5,588,486  
Purchases and sales –  
Purchases 357,397  
Sales –  
Closing balance at July 31, 2017 5,945,883  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ 5,588,486  

 

- 53 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

    FAIR VALUE  
  MEASUREMENTS  
  USING SIGNIFICANT  
  UNOBSERVABLE  
  INPUTS (LEVEL 3)  
Alger Growth & Income Fund Common Stocks  
Opening balance at November 1, 2016 $ 14,979  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments –  
Included in net unrealized gain (loss) on investments (14,979 )
Purchases and sales –  
Purchases –  
Sales –  
Closing balance at July 31, 2017 0  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ (14,979 )
 
Alger Growth & Income Fund Corporate Bonds  
Opening balance at November 1, 2016 $ 15,285  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments –  
Included in net unrealized gain (loss) on investments (15,285 )
Purchases and sales –  
Purchases –  
Sales –  
Closing balance at July 31, 2017 0  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ (15,285 )
 
Alger Growth & Income Fund Preferred Stocks  
Opening balance at November 1, 2016 $ 52,648  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments –  
Included in net unrealized gain (loss) on investments (52,648 )
Purchases and sales –  
Purchases –  
Sales –  
Closing balance at July 31, 2017 0  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ (52,648 )

 

- 54 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

    FAIR VALUE  
  MEASUREMENTS  
  USING SIGNIFICANT  
  UNOBSERVABLE  
  INPUTS (LEVEL 3)  
Alger Growth & Income Fund     Warrants  
Opening balance at November 1, 2016 $ 14,979  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments –  
Included in net unrealized gain (loss) on investments (14,979 )
Purchases and sales –  
Purchases –  
Sales –  
Closing balance at July 31, 2017 0  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ (14,979 )
 
    FAIR VALUE  
  MEASUREMENTS  
  USING SIGNIFICANT  
  UNOBSERVABLE  
  INPUTS (LEVEL 3)  
Alger SMid Cap Focus Fund Common Stocks  
Opening balance at November 1, 2016 $ 622,021  
Transfers into Level 3 —  
Transfers out of Level 3 —  
Total gains or losses        
Included in net realized gain (loss) on investments –  
Included in net unrealized gain (loss) on investments (127,656 )
Purchases and sales –  
Purchases –  
Sales –  
Closing balance at July 31, 2017 494,365  
The amount of total gains or losses for the period included in net realized        
and unrealized gain (loss) attributable to change in unrealized appreciation        
(depreciation) relating to investments still held at 7/31/2017 $ (127,656 )

 

- 55 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

    FAIR VALUE
  MEASUREMENTS
  USING SIGNIFICANT
  UNOBSERVABLE
  INPUTS (LEVEL 3)
Alger SMid Cap Focus Fund Preferred Stocks
Opening balance at November 1, 2016 $ 6,615,493
Transfers into Level 3 —
Transfers out of Level 3 —
Total gains or losses      
Included in net realized gain (loss) on investments –
Included in net unrealized gain (loss) on investments 558,345
Purchases and sales –
Purchases –
Sales –
Closing balance at July 31, 2017 6,057,148
The amount of total gains or losses for the period included in net realized      
and unrealized gain (loss) attributable to change in unrealized appreciation      
(depreciation) relating to investments still held at 7/31/2017 $ 558,345
 
Alger SMid Cap Focus Fund     Rights
Opening balance at November 1, 2016 $ —
Transfers into Level 3 —
Transfers out of Level 3 —
Total gains or losses      
Included in net realized gain (loss) on investments –
Included in net unrealized gain (loss) on investments 106,642
Purchases and sales –
Purchases –
Sales –
Closing balance at July 31, 2017 106,642
The amount of total gains or losses for the period included in net realized      
and unrealized gain (loss) attributable to change in unrealized appreciation      
(depreciation) relating to investments still held at 7/31/2017 $ 106,642

 

The following table provides quantitative information about our Level 3 fair value
measurements of our investments as of July 31, 2017. In addition to the techniques and
inputs noted in the table below, according to our valuation policy we may also use other
valuation techniques and methodologies when determining our fair value measurements.
The table below is not intended to be all-inclusive, but rather provides information on the
Level 3 inputs as they relate to our fair value measurements.

    Fair Value Valuation Unobservable     Weighted  
    July 31, 2017 Methodology Input Input/ Range   Average  
Alger Capital Appreciation Fund                
Common Stocks $ 931,955 Income Revenue 10x-18x N/A  
      Approach Multiple 20-40% 20%
        Discount Rate 10-50% N/A  
        Scenario        
        Probability        

 

- 56 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

        Time to Exit 0.55-2.55   N/A  
          Years      
Preferred Stocks   4,295,976 Income Revenue 10x-18x N/A  
      Approach Multiple 20-40% 20%
        Discount Rate 10-80% N/A  
        Scenario      
        Probability      
        Time to Exit 0.55-2.55 N/A  
          Years    
Preferred Stocks   4,503,534 Market Scenario 80-100% N/A  
      Approach Probability Time 0.25-1.75 N/A  
        to Exit Years    
Warrants   0 Income Discount Rate 40% N/A  
      Approach        
Corporate Bonds   0 Income Discount Rate 40% N/A  
      Approach          
Alger Mid Cap Growth Fund                
Common Stocks $ 99,566 Income Revenue 10x-18x N/A  
      Approach Multiple 20-40% 20%
        Discount Rate 10-50% N/A  
        Scenario      
        Probability      
        Time to Exit 0.55-2.55 N/A  
          Years    
Preferred Stocks   1,295,681 Income Revenue 9x-17x N/A  
      Approach Multiple 20-39.5% 23.68%
        Discount Rate 10-80% 43.5%
        Scenario      
        Probability        
        Time to Exit 0.55-2.55   N/A  
          Years      
Special Purpose Vehicle   357,727 Market Revenue 2.6x-3.1x   N/A  
      Approach Multiple        
Rights   1,361,738 Income Discount Rate 21.5-22.5%   N/A  
      Approach          
Alger Health Sciences Fund                
Common Stocks   3,724,140 Income Discount Rate 30% N/A  
      Approach          
Preferred Stocks   443,177 Market Scenario 80-100% N/A  
      Approach Probability Time 0.25-1.75   N/A  
        to Exit Years   N/A  
        Volatility 67.8%    
Preferred Stocks   3,418,964 Income Discount Rate 35.5-39.5%   N/A  
      Approach          
Rights   5,945,883 Income Discount Rate 21.5-30% N/A  
      Approach          
Alger Growth & Income Fund                
Common Stocks   0 Income Discount Rate 40% N/A  
      Approach          

 

- 57 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

Preferred Stocks 0 Income Discount Rate 40% N/A  
    Approach        
Corporate Bonds 0 Income Discount Rate 40% N/A  
    Approach        
Warrants 0 Income Discount Rate 40% N/A  
    Approach        
Alger SMid Cap Growth Fund            
Common Stocks 494,365 Income Revenue 10x-18x N/A  
    Approach Multiple 20-40% 20%
      Discount Rate 10-50% N/A  
      Scenario        
      Probability        
      Time to Exit 0.55-2.55   N/A  
        Years      
Preferred Stocks 2,278,845 Market Scenario 80-100% N/A  
    Approach Probability Time 1.0-2.5 Years  N/A  
      to Exit 67.8% N/A  
      Volatility      
Preferred Stocks 3,778,303 Income Revenue 10x-18x N/A  
    Approach Multiple 20-40% 24.81%
      Discount Rate 10-50% N/A  
      Scenario      
      Probability        
      Time to Exit 0.55-2.55   N/A  
        Years      
Alger Small Cap Growth Fund              
Preferred Stocks 430,910 Income Discount Rate 35.5-39.5%   N/A  
    Approach          
Special Purpose Vehicle 329,471 Market Revenue 2.6x-3.1x   N/A  
    Approach Multiple        
Rights 430,910 Income Discount Rate 21.5-22.5%   N/A  
    Approach          
Alger Small Cap Focus Fund              
Rights 27,474 Income Discount Rate 21.5-22.5%   N/A  
    Approach          

 

The significant unobservable inputs used in the fair value measurement of the company’s
securities are revenue and EBITDA multiples, discount rates, and the probabilities of
success of certain outcomes. Significant increases and decreases in these inputs in isolation
and interrelationships between those inputs could result in significantly higher or lower fair
value measurements as noted in the table above.

On July 31, 2017 there were no transfers of securities between Level 1, Level 2 and Level 3

Certain of the Fund’s assets and liabilities are held at carrying amount or face value, which
approximates fair value for financial statement purposes. As of July 31, 2017, such assets are
categorized within the disclosure hierarchy as follows:

- 58 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

    TOTAL FUND   LEVEL 1 LEVEL 2   LEVEL 3
Cash, Foreign cash and Cash equivalents:                      
Alger Capital Appreciation Fund $ 26,933,284 — $ 26,933,284 —
Alger International Growth Fund     3,177,058   — 3,177,058   —
Alger Mid Cap Growth Fund     6,014,140   — 6,014,140   —
Alger Small Cap Growth Fund     3,480,761   — 3,480,761   —
Alger Small Cap Focus Fund     9,705,302   — 9,705,302   —
Alger Health Sciences Fund     1,393,532   —  1,393,532   —
Alger Growth & Income Fund     3,337,886   —  3,337,886   —
Alger SMid Cap Focus Fund     6,156,818   — 6,156,818   —
Total $ 60,198,781 — $ 60,198,781 —

 

NOTE 4 — Derivatives:
Financial Accounting Standards Board Accounting Standards Codification 815 – Derivatives
and Hedging (“ASC 815”) requires qualitative disclosures about objectives and strategies for
using derivatives, quantitative disclosures about fair value amounts of and gains and losses
on derivative instruments, and disclosures about credit-risk-related contingent features in
derivative agreements.

Options—The Funds seek to capture the majority of the returns associated with equity
market investments. To meet this investment goal, the Funds invest in a broadly diversified
portfolio of common stocks, while also buying and selling call and put options on equities
and equity indices. The Funds purchase call options to increase their exposure to the stock
market and also provide diversification of risk. The Funds purchase put options in order
to protect from significant market declines that may occur over a short period of time. The
Funds will write covered call and cash secured put options to generate cash flows while
reducing the volatility of the Funds’ portfolios. The cash flows may be an important source
of the Funds’ returns, although written call options may reduce the Funds’ ability to profit
from increases in the value of the underlying security or equity portfolio. The value of a
call option generally increases as the price of the underlying stock increases and decreases
as the stock decreases in price. Conversely, the value of a put option generally increases
as the price of the underlying stock decreases and decreases as the stock increases in price.
The combination of the diversified stock portfolio and the purchase and sale of options
is intended to provide the Funds with the majority of the returns associated with equity
market investments but with reduced volatility and returns that are augmented with the cash
flows from the sale of options. During the three months ended July 31, 2017, options were
used in accordance with these objectives.

The Funds’ option contracts were not subject to any rights of offset with any counterparty.
All of the Funds’ options were exchange traded which utilize a clearing house that acts as an
intermediary between buyer and seller, receiving initial and maintenance margin from both,
and guaranteeing performance of the option contract.

For the three months ended July 31, 2017, there were no open derivative instruments.

- 59 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

NOTE 5 — Affiliated Securities:
The securities listed below are deemed to be affiliate’s of the Funds because the Funds or
their affiliates owned 5% or more of the company’s voting securities during all or part of
the period ended July 31, 2017. Purchase and sale transactions and dividend income earned
during the year were as follows:

  Shares at     Shares at     Value at
  October 31,     July 31, Dividend   July 31,
Security 2016 Additions Reductions 2017 Income   2017
Alger Capital Appreciation Fund              
Common Stocks              
Choicestream Inc. * 82,955 — — 82,955 — $ 0
Preferred Stocks              
Choicestream, Inc. 2,365,288 — — 2,365,288 —   0
Class A & Class B*              
Corporate Bonds              
Choicestream, Inc. , 387,502 — — 387,502 —   0
11.0%,8/05/18              
Warrants              
Choicestream, Inc. , 06/22/26 387,502 — — 387,502 —   0
Alger Mid Cap Growth Fund              
Preferred Stocks              
Prosetta Biosciences, 219,610 — — 219,610 —   836,714
Inc. *              
Tolero Pharmaceuticals, Inc. * 495,000 — 495,000 0 —   0
Alger SMid Cap Growth Fund              
Preferred Stocks              
Prosetta Biosciences, 231,474 — — 231,474 —   881,916
Inc. *              
Alger Small Cap Growth Fund              
Preferred Stocks              
Prosetta Biosciences, 50,688 — — 50,688 —   193,121
Inc. *              
Tolero Pharmaceuticals, Inc. * 148,237 — 148,237 0 —   0
Alger Small Cap Focus Fund              
Preferred Stocks              
Tolero Pharmaceuticals, Inc. * 10,097 — 10,097 0 —   0
Alger Health Sciences Fund              

 

- 60 -

 

THE ALGER FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

Preferred Stocks            
Prosetta Biosciences, 897,366 — — 897,366 — 3,418,964
Inc. *            
Tolero Pharmaceuticals, Inc. * 1,638,547 — 1,638,547 0 — 0
Alger Growth & Income Fund            
Common Stocks            
Choicestream Inc. * 5,064 — — 5,064 — 0
Preferred Stocks            
Choicestream, Inc. 132,906 — — 132,906 — 0
Class A & Class B*            
Corporate Bonds            
Choicestream, Inc. , 15,285 — — 18,285 — 0
11.0%,8/05/18            
Warrants            
Choicestream, Inc. , 06/22/26 15,285 — — 15,285 — 0

 

* Non-income producing security.

- 61 -

 

ITEM 2. Controls and Procedures.

(a) Based on their evaluation of Registrant’s disclosure controls and procedures (as
defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended) as of a
date within 90 days of the filing of this document, Registrant’s principal executive officer and
principal financial officer found Registrant’s disclosure controls and procedures to provide
reasonable assurances that information required to be disclosed by Registrant in the reports
it files under the Securities Exchange Act of 1934 (a) is accumulated and communicated
to Registrant’s management, including its principal executive officer and principal financial
officer, as appropriate to allow timely decisions regarding required disclosure, and (b) is
recorded, processed, summarized and reported within the time periods specified in the rules
and forms adopted by the U.S. Securities and Exchange Commission.

(b) No changes in the registrant’s internal control over financial reporting occurred during
the registrant’s last fiscal quarter that materially affected, or are reasonably likely to materially
affect, the registrant’s internal control over financial reporting.

ITEM 3. Exhibits.

Certifications of principal executive officer and principal financial officer as required by
Rule 30a-2(a) under the Investment Company Act of 1940 are attached as Exhibit 99.
CERT.

- 62 -

 

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.

The Alger Funds

By /s/Hal Liebes

Hal Liebes

President

Date: September 26, 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.

By /s/Hal Liebes

Hal Liebes

President

Date: September 26, 2017

By /s/ Michael D. Martins

Michael D. Martins

Treasurer

Date: September 26, 2017

- 63 -