N-CSR 1 d49721dncsr.htm HARTFORD MUTUAL FUNDS II, INC. HARTFORD MUTUAL FUNDS II, INC.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT

INVESTMENT COMPANIES

Investment Company Act file number: 811-00558

THE HARTFORD MUTUAL FUNDS II, INC.

(Exact name of registrant as specified in charter)

5 Radnor Corporate Center, Suite 300, 100 Matsonford Road, Radnor, Pennsylvania 19087

(Address of Principal Executive Offices) (Zip Code)

Edward P. Macdonald, Esquire

Hartford Funds Management Company, LLC

5 Radnor Corporate Center, Suite 300

100 Matsonford Road

Radnor, Pennsylvania 19087

(Name and Address of Agent for Service)

Registrant’s telephone number, including area code: (610) 386-4068

Date of fiscal year end: October 31

Date of reporting period: October 31, 2015

Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.

A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 100 F Street, NE, Washington, DC 20549. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.


Item 1. Reports to Stockholders.


LOGO

 


LOGO

A MESSAGE FROM THE PRESIDENT

Dear Fellow Shareholders:

Thank you for investing in Hartford Funds.

Market Review

During the year ended October 31, 2015, the period of this report, the stock market suffered its first correction (a decline of at least 10%) since 2011. Although volatility returned at

 

summer’s end, stocks recovered from the decline and the S&P 500 Index1 managed to climb back into positive territory, gaining 2.70% through the end of October.

The correction in domestic markets came as a response to uncertainty abroad. Since China is the second-largest economy in the world, late-summer worries of a slowdown in its economy had far-reaching impacts. The full impact of that slowing growth remains to be seen. Markets stabilized within a few weeks and stocks continued their upward climb, continuing the now six-year-old bull market that began in 2009.

From a broader perspective, a strong dollar, low oil prices, and central-bank policies influenced market movements throughout the period this report covers. Investors have been keeping a watchful eye on the U.S. Federal Reserve (the Fed) and international central banks, which continue to influence markets through quantitative-easing programs designed to support growth.

While the Fed ended its own quantitative-easing program in late 2014, its next influential move is to try to normalize interest rates, which have held near zero since 2008. At the time of this writing, that process is expected to begin in December 2015. Stocks have reacted to rumors of interest-rate hikes in the past, and are likely to do so again. However, that policy change will be particularly impactful for fixed-income investors, as bonds tend to be more sensitive to rate changes than equities.

As we enter 2016, we encourage you to maintain a strong relationship with a financial advisor who can help guide you through shifting markets with confidence. As the volatility during the summer of 2015 proved, markets are unpredictable and it’s important to proactively build a portfolio that takes into account your unique investment goals and risk tolerances. Your financial advisor can help you find a fit within our family of more than 45 mutual funds as you work toward those goals.

Thank you again for investing with Hartford Funds.

 

LOGO

James Davey

President

Hartford Funds

 

 

1  S&P 500 Index is a market capitalization-weighted price index composed of 500 widely held common stocks.


Domestic Equity Funds

Table of Contents

 

Fund Performance and Manager Discussions (Unaudited)

    2   

Expense Examples (Unaudited)

    38   

Financial Statements:

 

Schedules of Investments:

 

The Hartford Capital Appreciation Fund

    44   

Hartford Core Equity Fund

    53   

The Hartford Dividend and Growth Fund

    57   

The Hartford Equity Income Fund

    61   

The Hartford Growth Opportunities Fund

    64   

The Hartford Healthcare Fund

    70   

The Hartford MidCap Fund

    74   

The Hartford MidCap Value Fund

    78   

Hartford Small Cap Core Fund

    82   

The Hartford Small Company Fund

    87   

The Hartford SmallCap Growth Fund

    94   

The Hartford Value Opportunities Fund

    100   

Statements of Assets and Liabilities

    106   

Statements of Operations

    112   

Statements of Changes in Net Assets

    116   

Financial Highlights

    121   

Notes to Financial Statements

    134   

Report of Independent Registered Public Accounting Firm

    173   

Directors and Officers (Unaudited)

    174   

How to Obtain a Copy of each Fund’s Proxy Voting Policies and Voting Records (Unaudited)

    176   

Quarterly Portfolio Holdings Information (Unaudited)

    176   

Federal Tax Information (Unaudited)

    177   

Approval of Investment Management and Investment Sub-Advisory Agreements (Unaudited)

    178   

Main Risks (Unaudited)

    184   

The views expressed in each Fund’s Manager Discussion under “Why did the Fund perform this way?” and “What is the outlook?” are views of that Fund’s sub-adviser and portfolio management team through the end of the period and are subject to change based on market and other conditions. Each Fund’s Manager Discussion is for informational purposes only and does not represent an offer, recommendation or solicitation to buy, hold or sell any security. The specific securities identified and described, if any, do not represent all of the securities purchased or sold and you should not assume that investments in the securities identified and discussed will be profitable.


The Hartford Capital Appreciation Fund inception 07/22/1996

 

(sub-advised by Wellington Management Company LLP)   Investment objective – The Fund seeks growth of capital.

 

LOGO

The chart above represents the hypothetical growth of a $10,000 investment in Class A, which includes a sales charge. Growth results in classes other than Class A will vary from what is seen above due to differences in the expenses charged to those share classes.

 

Average Annual Total Returns (as of 10/31/15)

 

      1 Year      5 Years      10 Years  

Capital Appreciation A1

     4.20%         11.23%         7.19%   

Capital Appreciation A2

     -1.53%         9.98%         6.59%   

Capital Appreciation B1

     3.30%         10.29%         6.49% 3 

Capital Appreciation B2

     -0.33%         10.02%         6.49% 3 

Capital Appreciation C1

     3.47%         10.44%         6.43%   

Capital Appreciation C2

     2.74%         10.44%         6.43%   

Capital Appreciation I1

     4.53%         11.57%         7.49%   

Capital Appreciation R31

     3.87%         10.92%         6.97%   

Capital Appreciation R41

     4.18%         11.26%         7.27%   

Capital Appreciation R51

     4.49%         11.59%         7.55%   

Capital Appreciation R61,4

     4.55%         11.69%         7.64%   

Capital Appreciation Y1

     4.60%         11.70%         7.65%   

Russell 3000 Index

     4.49%         14.14%         7.94%   

S&P 500 Index

     5.20%         14.33%         7.85%   

 

1  Without sales charge
2  With sales charge
3  Class B shares convert to Class A shares after 8 years. The return shown reflects the conversion to Class A shares, which had different operating expenses for the period after conversion.
4  Inception: 11/07/2014.

PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND DOES NOT GUARANTEE FUTURE RESULTS. The investment return and principal value of the investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain performance data current to the most recent month-end, please visit our website www.hartfordfunds.com.

The initial investment in Class A shares reflects the maximum sales charge of 5.50% and returns for Class B shares reflect a contingent deferred sales charge of up to 5.00% and declining to zero, depending on the period of time the shares are held.

Returns for Class C shares reflect a contingent deferred sales charge of up to 1.00% on shares redeemed within twelve months of purchase.

Total returns presented above were calculated using the Fund’s net asset value available to shareholders for sale or redemption of Fund shares on October 31, 2015, which may exclude investment transactions as of this date. All share class returns assume the reinvestment of all distributions at net asset value and the deduction of all fund expenses.

Effective 9/30/09, Class B shares of the Fund were closed to new investments.

Class I shares commenced operations on 8/31/06. Performance prior to that date is that of the Fund’s Class A shares (excluding sales charges), which had different operating expenses. Class R3, R4 and R5 shares commenced operations on 12/22/06. Performance prior to that date is that of the Fund’s Class Y shares, which had different operating expenses. Class R6 shares commenced operations on 11/07/14. Performance prior to that date is that of the Fund’s Class Y shares.

Russell 3000 Index is an unmanaged index that measures the performance of the 3,000 largest U.S. companies based on total market capitalization.

S&P 500 Index is a market capitalization-weighted price index composed of 500 widely held common stocks.

You cannot invest directly in an index.

The chart and table do not reflect the deductions of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Performance information may reflect historical or current expense waivers/reimbursements from the investment adviser, without which performance would have been lower. For information on current expense waivers/reimbursements, please see the prospectus.

 

 

 

  2  

 


The Hartford Capital Appreciation Fund

Manager Discussion

October 31, 2015 (Unaudited)

 

 

 

Operating Expenses*

 

      Net      Gross  

Captial Appreciation Class A

     1.10%         1.10%   

Captial Appreciation Class B

     1.95%         1.95%   

Captial Appreciation Class C

     1.81%         1.81%   

Captial Appreciation Class I

     0.76%         0.76%   

Captial Appreciation Class R3

     1.40%         1.40%   

Captial Appreciation Class R4

     1.10%         1.10%   

Captial Appreciation Class R5

     0.80%         0.80%   

Captial Appreciation Class R6

     0.70%         0.70%   

Captial Appreciation Class Y

     0.70%         0.70%   

 

* Actual expenses may be higher or lower. Please see accompanying Financial Highlights for expense ratios for the year ended October 31, 2015.

Expense ratios are as shown in the most recent prospectus. Net expenses reflect contractual expense reimbursements in instances when these reductions reduce the Fund’s gross expenses. Contractual reimbursements remain in effect until February 29, 2016 and automatically renew for one-year terms unless terminated.

All investments are subject to risk including the possible loss of principal. For a discussion of the Fund’s risks, please see the Main Risks section of this report. For more detailed information on the risks associated with an investment in the Fund, please see the prospectus.

 

 

 

Portfolio Managers

Saul J. Pannell, CFA

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

Frank D. Catrickes, CFA

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

Kent M. Stahl, CFA

Senior Managing Director and Director, Investment Strategy and Risk

Wellington Management Company LLP

Gregg R. Thomas, CFA

Senior Managing Director and Associate Director, Investment Strategy and Risk

Wellington Management Company LLP

 

 

 

How did the Fund perform during the period?

The Class A shares of The Hartford Capital Appreciation Fund returned 4.20%, before sales charge, for the twelve-month period ended October 31, 2015, underperforming the Fund’s benchmarks, the Russell 3000 Index and the S&P 500 Index, which returned 4.49% and 5.20%, respectively, for the same period. The Fund outperformed the 2.09% average return of the Lipper Multi-Cap Core Funds peer group, a group of funds with investment strategies similar to those of the Fund.

Why did the Fund perform this way?

U.S. equities, as measured by the S&P 500 Index, rose during the twelve-month period. U.S. stocks finished 2014 with strong gains, retreated briefly early in 2015, but then reached new all-time highs on March 2, April 24, and May 21. The market pulled back in early March as soft manufacturing data, potentially negative currency- and oil-related earnings data, and valuation concerns weighed on investors’ minds. However, risk appetites increased after the March 18 Federal Open Market Committee statement underlined the U.S. Federal Reserve’s (Fed) hesitation to raise rates as U.S. domestic inflation remained subdued and other major central banks maintained

an easing bias. In April, the tech-heavy Nasdaq Composite topped the 5,000 mark for the first time in 15 years and broke its closing record from March 2000. Continued strong merger and acquisition (M&A) activity, a rebound in hiring, and solid housing data helped to fuel risk appetites. May marked the second-best month ever for M&A transactions involving U.S. companies with $234 billion in announced mergers. Stocks ended June on a sour note after negotiations between Greece and its creditors regarding Greece’s loan repayments broke down.

In the second half of the period, the U.S. economy remained on solid footing, with a sharp rebound in Gross Domestic Product (GDP), a seven-year low in unemployment, and a healthy housing market. While the growth slowdown in China and its implications for global commerce fueled investor anxiety during the second half of the period, uncertainty about the Fed’s rate hike timeline also weighed on sentiment. During August and September, the market remained extremely volatile and experienced its first correction (a decline of at least 10%) since October 2011. As many market participants expected, the Fed left rates unchanged at its highly anticipated September meeting. The Fed’s statement appeared to spook some

 

 

 

  3  

 


The Hartford Capital Appreciation Fund

Manager Discussion – (continued)

October 31, 2015 (Unaudited)

 

 

 

investors as it acknowledged that “recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term.” U.S. equities ended the period with their best monthly return in four years during the month of October on the heels of strong corporate earnings and continued accommodative monetary policy across the globe. During the period, returns varied noticeably by market-cap, as small- and mid-cap stocks underperformed large-cap stocks.

Six of ten sectors in the Russell 3000 Index posted positive returns during the period. Strong performers included the Consumer Discretionary (+16%), Information Technology (+11%), and Consumer Staples (+9%) sectors, while the Energy (-22%), Materials (-6%) and Telecommunication Services (-2%) sectors lagged on a relative basis.

The Fund underperformed the Russell 3000 Index primarily due to weak stock selection within the Energy, Industrials, and Materials sectors. Stock selection within the Consumer Staples and Consumer Discretionary sectors contributed to relative returns during the period. Sector allocation, a result of bottom-up stock selection, contributed to results relative to the Russell 3000 Index driven by our underweight to Energy and overweights to the Consumer Discretionary and Information Technology sectors.

Top detractors from performance relative to the Russell 3000 Index included Micron Technology (Information Technology), Mylan (Healthcare), and Pioneer Natural Resources (Energy). Shares of Micron Technology, a U.S.-based semiconductor manufacturer, fell as investors worried about the demand outlook for the DRAM (dynamic random-access memory) market. Shares of Mylan, a U.S.-based global pharmaceutical company, fell on news that Mylan’s competitor TEVA withdrew from its pursuit for the company. U.S.-based independent oil and gas exploration company Pioneer Natural Resources’ shares underperformed amid falling oil prices, as lower crude prices have caused a major retrenchment in oil company exploration and production spending. Halliburton (Energy), a U.S.-based global oilfield product and services company, detracted from performance on an absolute basis over the period.

Activision Blizzard (Information Technology), Uber Technologies (Information Technology), and Bristol-Myers (Healthcare), contributed to returns relative to the Russell 3000 Index over the period. The share price of Activision Blizzard, a U.S.-based electronic entertainment company, increased after successive quarterly earnings releases that beat market expectations. The company also recently announced plans to acquire King Digital Entertainment as it seeks to increase its mobile gaming offerings. The fair valuation of Uber Technologies, a U.S.-based ride-sharing service, increased as the company has been expanding and growing at a rapid pace, penetrating new markets and increasing market share on a global scale. Additionally, Baidu, a Chinese internet-search company,

announced that it intends to invest $600 million in Uber, and connect its mapping and search features with Uber in China. Shares of Bristol-Myers, a major U.S.-based pharmaceutical company, contributed to relative returns over the period due to strong earnings driven by success in its immune-oncology assets, in particular Opdivo. Amazon.com (Information Technology) was a top contributor to absolute returns over the period.

Derivatives were not used in a significant manner in this Fund during the period and did not have a material impact on performance during the period.

What is the outlook?

The period witnessed a dramatic increase in volatility as concerns about China weighed on the outlook for global growth. In addition, we believe that earnings growth looks more challenged and, following a long market expansion and relatively extended valuations, market sentiment has appeared to turn negative. We believe that while volatility may persist for a period of time, fundamentals in most developed markets look robust. We believe that a “muddle through” scenario in which China slows in a managed fashion will allow a return to a more “risk-on” approach as we move through the fourth quarter of 2015 and beyond.

At the end of the period, our largest overweights were to the Consumer Discretionary, Healthcare, and Information Technology sectors, while our largest underweights were to the Consumer Staples and Energy sectors, relative to the Russell 3000 Index.

Diversification by Sector

as of October 31, 2015

 

Sector    Percentage of
Net Assets
 

Equity Securities

  

Consumer Discretionary

     16.4

Consumer Staples

     5.3   

Energy

     3.7   

Financials

     17.7   

Health Care

     17.2   

Industrials

     10.6   

Information Technology

     22.2   

Materials

     3.1   

Telecommunication Services

     0.4   

Utilities

     1.1   
  

 

 

 

Total

     97.7
  

 

 

 

Short-Term Investments

     1.9   

Other Assets & Liabilities

     0.4   
  

 

 

 

Total

     100.0
  

 

 

 

A sector may be comprised of several industries. For Fund compliance purposes, the Fund may not use the same classification system and these sector classifications are used for financial reporting purposes.

 

 

 

  4  

 


Hartford Core Equity Fund* inception 04/30/1998

 

(sub-advised by Wellington Management Company LLP)   Investment objective – The Fund seeks growth of capital.

LOGO

The chart above represents the hypothetical growth of a $10,000 investment in Class A, which includes a sales charge. Growth results in classes other than Class A will vary from what is seen above due to differences in the expenses charged to those share classes.

 

Average Annual Total Returns (as of 10/31/15)

 

      1 Year      5 Years      10 Years  

Core Equity A1

     10.75%         15.81%         8.09%   

Core Equity A2

     4.66%         14.51%         7.48%   

Core Equity B1

     9.92%         14.92%         7.51% 3 

Core Equity B2

     4.92%         14.69%         7.51% 3 

Core Equity C1

     9.95%         14.98%         7.31%   

Core Equity C2

     8.95%         14.98%         7.31%   

Core Equity I1,4

     10.94%         15.85%         8.11%   

Core Equity R31

     10.46%         15.58%         7.96%   

Core Equity R41

     10.82%         15.96%         8.23%   

Core Equity R51

     11.10%         16.28%         8.53%   

Core Equity R61,4

     11.15%         16.32%         8.60%   

Core Equity Y1

     11.15%         16.32%         8.60%   

S&P 500 Index

     5.20%         14.33%         7.85%   

 

1  Without sales charge
2 With sales charge
3 Class B shares convert to Class A shares after 8 years. The return shown reflects the conversion to Class A shares, which had different operating expenses for the period after conversion.
4  Inception: 03/31/2015.

PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND DOES NOT GUARANTEE FUTURE RESULTS. The investment return and principal value of the investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain performance data current to the most recent month-end, please visit our website www.hartfordfunds.com.

The initial investment in Class A shares reflects the maximum sales charge of 5.50% and returns for Class B shares reflect a contingent deferred sales charge of up to 5.00% and declining to zero, depending on the period of time the shares are held.

Returns for Class C shares reflect a contingent deferred sales charge of up to 1.00% on shares redeemed within twelve months of purchase.

Total returns presented above were calculated using the Fund’s net asset value available to shareholders for sale or redemption of Fund shares on October 31, 2015, which may exclude investment transactions as of this date. All share class returns assume the reinvestment of all distributions at net asset value and the deduction of all fund expenses.

Effective 9/30/09, Class B shares of the Fund were closed to new investments.

Class R3, R4 and R5 shares commenced operations on 12/22/06. Performance prior to that date is that of the Fund’s Class Y shares, which had different operating expenses. Class I shares commenced operations on 3/31/15. Performance prior to that date is that of the Fund’s Class Y shares, which had different operating expenses. Class R6 shares commenced operations on 3/31/15 and performance prior to that date is that of the Fund’s Class Y shares.

S&P 500 Index is a market capitalization-weighted price index composed of 500 widely held common stocks.

You cannot invest directly in an index.

The chart and table do not reflect the deductions of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Performance information may reflect historical or current expense waivers/reimbursements from the investment adviser, without which performance would have been lower. For information on current expense waivers/reimbursements, please see the prospectus.

 

* Effective March 31, 2015, The Hardford Disciplined Equity Fund changed its name to Hardford Core Equity Fund.
 

 

 

  5  

 


Hartford Core Equity Fund

Manager Discussion

October 31, 2015 (Unaudited)

 

 

 

Operating Expenses*

 

      Net      Gross  

Core Equity Class A

     0.79%         1.07%   

Core Equity Class B

     1.54%         2.19%   

Core Equity Class C

     1.54%         1.76%   

Core Equity Class I

     0.54%         0.76%   

Core Equity Class R3

     1.09%         1.40%   

Core Equity Class R4

     0.79%         1.04%   

Core Equity Class R5

     0.49%         0.74%   

Core Equity Class R6

     0.45%         0.61%   

Core Equity Class Y

     0.49%         0.61%   

 

* Actual expenses may be higher or lower. Please see accompanying Financial Highlights for expense ratios for the year ended October 31, 2015.

Expense ratios are as shown in the most recent prospectus. Net expenses reflect contractual expense reimbursements in instances when these reductions reduce the Fund’s gross expenses. Contractual reimbursements remain in effect until February 29, 2016 and automatically renew for one-year terms unless terminated.

All investments are subject to risk including the possible loss of principal. For a discussion of the Fund’s risks, please see the Main Risks section of this report. For more detailed information on the risks associated with an investment in the Fund, please see the prospectus.

 

 

 

Portfolio Manager

Mammen Chally, CFA

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

 

 

 

How did the Fund perform during the period?

The Class A shares of the Hartford Core Equity Fund returned 10.75%, before sales charge, for the twelve-month period ended October 31, 2015, outperforming the Fund’s benchmark, the S&P 500 Index, which returned 5.20% for the same period. The Fund outperformed the 3.52% average return of the Lipper Large-Cap Core Funds peer group, a group of funds with investment strategies similar to those of the Fund.

Why did the Fund perform this way?

U.S. equities, as measured by the S&P 500 Index, rose during the twelve-month period. U.S. stocks finished 2014 with strong gains, retreated briefly early in 2015, but then reached new all-time highs on March 2, April 24, and May 21. The market pulled back in early March as soft manufacturing data, potentially negative currency- and oil-related earnings data, and valuation concerns weighed on investors’ minds. However, risk appetites increased after the March 18 Federal Open Market Committee statement underlined the U.S. Federal Reserve’s (Fed) hesitation to raise rates as U.S. domestic inflation remained subdued and other major central banks maintained an easing bias. In April, the tech-heavy Nasdaq Composite topped the 5,000 mark for the first time in 15 years and broke its closing record from March 2000. Continued strong merger and acquisition (M&A) activity, a rebound in hiring, and solid housing data helped to fuel risk appetites. May marked the second-best month ever for M&A transactions involving U.S. companies with $234 billion in announced mergers. Stocks ended June on a sour note after negotiations between Greece and its creditors regarding Greece’s loan repayments broke down.

In the second half of the period, the U.S. economy remained on solid footing, with a sharp rebound in Gross Domestic Product (GDP), a

seven-year low in unemployment, and a healthy housing market. While the growth slowdown in China and its implications for global commerce fueled investor anxiety during the second half of the period, uncertainty about the Fed’s rate hike timeline also weighed on sentiment. During August and September, the market remained extremely volatile and experienced its first correction (a decline of at least 10%) since October 2011. As many market participants expected, the Fed left rates unchanged at its highly anticipated September meeting. The Fed’s statement appeared to spook some investors as it acknowledged that “recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term.” U.S. equities ended the period with their best monthly return in four years during the month of October on the heels of strong corporate earnings and continued accommodative monetary policy across the globe.

Six out of ten sectors in the S&P 500 Index rose during the period, with Consumer Discretionary (+21%), Information Technology (+11%), and Consumer Staples (+9%) performing the best. Energy (-19%), Materials (-5%), and Telecommunication Services (-2%) lagged on a relative basis during the period. During the period, returns varied noticeably by market-cap, as small- and mid-cap stocks underperformed large-cap stocks.

Overall, outperformance versus the S&P 500 Index was driven by strong security selection, primarily within the Consumer Staples, Information Technology, and Industrials sectors. This more than offset weak stock selection within the Consumer Discretionary sector. Sector allocation, a result of the bottom up stock selection process, also contributed to outperformance relative to the S&P 500 Index during the period, in part due to our underweight to Energy and

 

 

 

  6  

 


Hartford Core Equity Fund

Manager Discussion – (continued)

October 31, 2015 (Unaudited)

 

 

 

Telecommunication Services and overweight to Healthcare. This was partially offset by our overweight to Utilities.

The top contributors to performance relative to the S&P 500 Index were Autozone (Consumer Discretionary), Coty (Consumer Staples), and Omnicare (Healthcare). Shares of AutoZone, a U.S.-based retailer of aftermarket auto parts, moved higher amid solid quarterly earnings and the announcement of an additional $750 million stock buyback authorization. Shares of Coty, a U.S.-based manufacturer and distributor of beauty products, rose after the company announced the acquisition of the beauty assets of Procter & Gamble (Consumer Staples). Shares of Omnicare, a Healthcare services company offering long term and specialty care services, rose after CVS Health (Consumer Staples) announced that it would acquire the company. In addition, our position in Mondelez (Consumer Staples) was a top contributor to absolute performance.

The top detractors from performance relative to the S&P 500 Index were Amazon.com (Consumer Discretionary), Biogen (Healthcare), and Facebook (Information Technology). Shares of Amazon.com, a U.S.-based leader in the online e-commerce industry, outperformed after the company posted better than expected quarterly earnings. Not owning this S&P 500 Index component stock weighed on relative performance during the period. Shares of Biogen, a U.S.-based biotechnology company, fell due to concerns about the industry’s high prescription drug prices and disappointing earnings. Shares of Facebook, a U.S. based global social networking service and website, rose during the period due to increased expectations around video ads and Instagram monetization. Not owning this benchmark-component stock weighed on relative performance during the period. Top absolute detractors also included Chevron (Energy) and Anadarko (Energy).

Derivatives were not used in a significant manner in this Fund during the period and did not have a material impact on performance during the period.

What is the outlook?

We believe the U.S. economy is still in a period of moderate economic growth, led by a steady expansion of consumption, housing, and technology spending. Because the Fed did not hike rates in September, there appears to be some concerns about weak global growth impacting the U.S. While uncertainty outside of the U.S. has increased, our base case is that the U.S. economy will continue on its moderate growth path. We think the U.S. employment situation is fairly healthy, which should continue to support housing and consumption. In terms of the Fed, our base case is that the central bank raises rates at its December meeting, followed by moderate additional hikes in 2016.

Globally, among large emerging economies, growth in China appears weak and Brazil is also struggling. Several emerging market economies are facing conditions that may make future growth difficult

as they contend with lower revenues from the sharp drop in the commodities complex and the increased burden of dollar denominated debt they hold due to the strength of the U.S. dollar. Many investors now fear that the U.S. economy is vulnerable due to this weak global economic backdrop, and the Fed’s recent commentary appeared to fuel this anxiety. Things have gotten a little more uncertain in terms of the global economy and the market seems a bit more unsettled. However, we remain cautiously optimistic that the U.S. economy can withstand any potential contagion.

Overall, we continue to find what we consider to be attractively valued stocks with the characteristics we seek. While the global economic landscape has weakened, we are cautiously optimistic about the outlook for the U.S. economy and for equity markets, and we continue to monitor policy decisions and economic trends which may impact our holdings. At the end of the period, our largest overweight positions relative to the S&P 500 Index were to Consumer Staples and Utilities, while our largest underweights were in Energy and Telecommunication Services.

Diversification by Sector

as of October 31, 2015

 

Sector    Percentage of
Net Assets
 

Equity Securities

  

Consumer Discretionary

     12.8

Consumer Staples

     14.0   

Energy

     2.5   

Financials

     13.3   

Health Care

     13.8   

Industrials

     7.9   

Information Technology

     20.0   

Materials

     3.4   

Utilities

     4.0   
  

 

 

 

Total

     91.7
  

 

 

 

Short-Term Investments

     3.9   

Other Assets & Liabilities

     4.4   
  

 

 

 

Total

     100.0
  

 

 

 

A sector may be comprised of several industries. For Fund compliance purposes, the Fund may not use the same classification system and these sector classifications are used for financial reporting purposes.

 

 

 

  7  

 


The Hartford Dividend and Growth Fund inception 07/22/1996

 

(sub-advised by Wellington Management Company LLP)   Investment objective – The Fund seeks a high level of current income consistent with growth of capital.

LOGO

The chart above represents the hypothetical growth of a $10,000 investment in Class A, which includes a sales charge. Growth results in classes other than Class A will vary from what is seen above due to differences in the expenses charged to those share classes.

 

Average Annual Total Returns (as of 10/31/15)

 

      1 Year      5 Years      10 Year  

Dividend and Growth A1

     2.46%         12.29%         7.82%   

Dividend and Growth A2

     -3.18%         11.03%         7.21%   

Dividend and Growth B1

     1.54%         11.29%         7.08% 3 

Dividend and Growth B2

     -3.07%         11.03%         7.08% 3 

Dividend and Growth C1

     1.70%         11.47%         7.02%   

Dividend and Growth C2

     0.77%         11.47%         7.02%   

Dividend and Growth I1

     2.67%         12.57%         8.09%   

Dividend and Growth R31

     2.12%         11.96%         7.57%   

Dividend and Growth R41

     2.42%         12.30%         7.89%   

Dividend and Growth R51

     2.73%         12.64%         8.17%   

Dividend and Growth R61,4

     2.79%         12.74%         8.26%   

Dividend and Growth Y1

     2.83%         12.75%         8.27%   

S&P 500 Index

     5.20%         14.33%         7.85%   

Russell 1000 Value Index

     0.53%         13.26%         6.75%   

 

1  Without sales charge
2  With sales charge
3 Class B shares convert to Class A shares after 8 years. The return shown reflects the conversion to Class A shares, which had different operating expenses for the period after conversion.
4  Inception: 11/07/2014.

PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND DOES NOT GUARANTEE FUTURE RESULTS. The investment return and principal value of the investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain performance data current to the most recent month-end, please visit our website www.hartfordfunds.com.

The initial investment in Class A shares reflects the maximum sales charge of 5.50% and returns for Class B shares reflect a contingent deferred sales charge of up to 5.00% and declining to zero, depending on the period of time the shares are held.

Returns for Class C shares reflect a contingent deferred sales charge of up to 1.00% on shares redeemed within twelve months of purchase.

Total returns presented above were calculated using the Fund’s net asset value available to shareholders for sale or redemption of Fund shares on October 31, 2015, which may exclude investment transactions as of this date. All share class returns assume the reinvestment of all distributions at net asset value and the deduction of all fund expenses.

Effective 9/30/09, Class B shares of the Fund were closed to new investments.

Class I shares commenced operations on 8/31/06. Performance prior to that date is that of the Fund’s Class A shares (excluding sales charges), which had different operating expenses. Class R3, R4 and R5 shares commenced operations on 12/22/06. Performance prior to that date is that of the Fund’s Class Y shares, which had different operating expenses. Class R6 shares commenced operations on 11/07/14. Performance prior to that date is that of the Fund’s Class Y shares.

S&P 500 Index is a market capitalization-weighted price index composed of 500 widely held common stocks.

Russell 1000 Value Index is an unmanaged index that measures the performance of those Russell 1000 Index companies with lower price-to-book ratios and lower forecasted growth values. The Russell 1000 Index is an unmanaged index that measures the performance of the 1,000 largest companies in the Russell 3000 Index, which measures the performance of the 3,000 largest U.S. companies, based on total market capitalizations.

You cannot invest directly in an index.

The chart and table do not reflect the deductions of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Performance information may reflect historical or current expense waivers/reimbursements from the investment adviser, without which performance would have been lower. For information on current expense waivers/reimbursements, please see the prospectus.

 

 

 

  8  

 


The Hartford Dividend and Growth Fund

Manager Discussion

October 31, 2015 (Unaudited)

 

 

 

Operating Expenses*

 

      Net      Gross  

Dividend and Growth Class A

     1.02%         1.02%   

Dividend and Growth Class B

     1.94%         1.96%   

Dividend and Growth Class C

     1.77%         1.77%   

Dividend and Growth Class I

     0.81%         0.81%   

Dividend and Growth Class R3

     1.35%         1.35%   

Dividend and Growth Class R4

     1.04%         1.04%   

Dividend and Growth Class R5

     0.74%         0.74%   

Dividend and Growth Class R6

     0.64%         0.64%   

Dividend and Growth Class Y

     0.64%         0.64%   

 

* Actual expenses may be higher or lower. Please see accompanying Financial Highlights for expense ratios for the year ended October 31, 2015.

Expense ratios are as shown in the most recent prospectus. Net expenses reflect contractual expense reimbursements in instances when these reductions reduce the Fund’s gross expenses. Contractual reimbursements remain in effect until February 29, 2016 and automatically renew for one-year terms unless terminated.

All investments are subject to risk including the possible loss of principal. For a discussion of the Fund’s risks, please see the Main Risks section of this report. For more detailed information on the risks associated with an investment in the Fund, please see the prospectus.

 

 

 

Portfolio Managers

Edward P. Bousa, CFA

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

Donald J. Kilbride

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

Matthew G. Baker

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

 

 

 

How did the Fund perform during the period?

The Class A shares of The Hartford Dividend and Growth Fund returned 2.46%, before sales charge, for the twelve-month period ended October 31, 2015, underperforming the Fund’s benchmark, the S&P 500 Index, which returned 5.20% for the same period. The Fund outperformed the Russell 1000 Value Index, the Fund’s other benchmark, which returned 0.53% for the same period. The Fund outperformed the 0.20% average return of the Lipper Equity Income Funds peer group, a group of funds with investment strategies similar to those of the Fund.

Why did the Fund perform this way?

U.S. equities, as measured by the S&P 500 Index, rose during the twelve-month period. U.S. stocks finished 2014 with strong gains, retreated briefly early in 2015, but then reached new all-time highs on March 2, April 24, and May 21. The market pulled back in early March as soft manufacturing data, potentially negative currency- and oil-related earnings data, and valuation concerns weighed on investors’ minds. However, risk appetites increased after the March 18 Federal Open Market Committee statement underlined the U.S. Federal Reserve’s (Fed) hesitation to raise rates as U.S. domestic inflation remained subdued and other major central banks maintained an easing bias. In April, the tech-heavy Nasdaq Composite topped the 5,000 mark for the first time in 15 years and broke its closing

record from March 2000. Continued strong merger and acquisition

activity (M&A), a rebound in hiring, and solid housing data helped to fuel risk appetites. May marked the second-best month ever for M&A transactions involving U.S. companies with $234 billion in announced mergers. Stocks ended June on a sour note after negotiations between Greece and its creditors regarding Greece’s loan repayments broke down.

In the second half of the period, the U.S. economy remained on solid footing, with a sharp rebound in Gross Domestic Product (GDP), a seven-year low in unemployment, and a healthy housing market. While the growth slowdown in China and its implications for global commerce fueled investor anxiety during the second half of the period, uncertainty about the Fed’s rate hike timeline also weighed on sentiment. During August and September, the market remained extremely volatile and experienced its first correction since (a declined at least 10%) October 2011. As many market participants expected, the Fed left rates unchanged at its highly anticipated September meeting. The Fed’s statement appeared to spook some investors as it acknowledged that “recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term.” U.S. equities ended the period with their best monthly return in four years during the month of October on the heels of strong corporate earnings and continued accommodative monetary policy across the globe.

 

 

 

  9  

 


The Hartford Dividend and Growth Fund

Manager Discussion – (continued)

October 31, 2015 (Unaudited)

 

 

 

Six out of ten sectors in the S&P 500 Index rose during the period, with Consumer Discretionary (+21%), Information Technology (+11%), and Consumer Staples (+9%) performing the best. Energy (-19%), Materials (-5%), and Telecommunication Services (-2%) lagged on a relative basis during the period. During the period, returns varied noticeably by market-cap, as small- and mid-cap stocks underperformed large-cap stocks.

Overall sector allocation, a result of the bottom up stock selection process, detracted from performance relative to the S&P 500 Index during the period, in part due to our underweights to Consumer Discretionary and Information Technology and overweight to Energy. This was partially offset by our underweight to the Materials sector. Security selection also detracted during the period, primarily due to negative selection within Consumer Discretionary, Energy, and Utilities. This was partially offset by positive stock selection within the Information Technology and Industrials sectors.

The Fund’s top detractors from performance relative to the S&P 500 Index included Amazon.com (Information Technology), Chevron (Energy), and Marathon Oil (Energy). Shares of Amazon.com, a U.S.-based leader in the online e-commerce industry, outperformed after the company posted better than expected quarterly earnings. Not owning this S&P 500 Index -component stock weighed on relative performance during the period. Shares of Chevron, a U.S.-based integrated oil and gas company, underperformed due to declining oil prices. Shares of Marathon Oil, an oil and natural gas exploration and production company, fell after the company reported a second-quarter net loss of $155 million, as cost reductions were not enough to offset the drop in the price of oil. Top absolute detractors also included NRG Energy (Energy).

The Fund’s top contributors to performance relative to the S&P 500 Index during the period were Accenture (Information Technology), Eli Lilly & Co (Healthcare), and Equifax (Industrials). Shares of Accenture, a global provider of management consulting, technology, and outsourcing services, rose due to better than expected earnings and strong growth in both the digital and core businesses. Shares of Eli Lilly & Co, a U.S.-based global pharmaceutical company, rose due to management’s greater focus on new product launches and pipeline advancements.

Shares of Equifax, a U.S.-based provider of information solutions and human resources business process outsourcing services, outperformed during the period due to acceleration in growth of all its business segments, favorable mortgage market conditions, and the smooth integration of recent acquisitions. Top absolute performers also included Microsoft (Information Technology) and Google (Information Technology).

Derivatives were not used in a significant manner in this Fund during the period and did not have a material impact on performance during the period.

What is the outlook?

We continue to search for investment ideas that fit with our process and philosophy. We remain focused on the significance of dividends, positive capital stewardship, and franchise value. We believe we have a solid portfolio of undervalued market leaders, stocks in industries with improving supply/demand trends, and solid companies that are temporarily out of favor. At the end of the period, our largest overweights were to the Financials, Industrials and Energy sectors, while our largest underweights were to the Consumer Discretionary and Information Technology sectors, relative to the S&P 500 Index.

Diversification by Sector

as of October 31, 2015

 

Sector    Percentage of
Net Assets
 

Equity Securities

  

Consumer Discretionary

     6.4

Consumer Staples

     7.7   

Energy

     9.0   

Financials

     21.8   

Health Care

     15.9   

Industrials

     12.4   

Information Technology

     14.7   

Materials

     1.7   

Telecommunication Services

     2.6   

Utilities

     4.0   
  

 

 

 

Total

     96.2
  

 

 

 

Short-Term Investments

     3.6   

Other Assets & Liabilities

     0.2   
  

 

 

 

Total

     100.0
  

 

 

 

A sector may be comprised of several industries. For Fund compliance purposes, the Fund may not use the same classification system and these sector classifications are used for financial reporting purposes.

 

 

 

  10  

 


The Hartford Equity Income Fund inception 08/28/2003

 

(sub-advised by Wellington Management Company LLP)   Investment objective – The Fund seeks a high level of current income consistent with growth of capital.

LOGO

The chart above represents the hypothetical growth of a $10,000 investment in Class A, which includes a sales charge. Growth results in classes other than Class A will vary from what is seen above due to differences in the expenses charged to those share classes.

 

Average Annual Total Returns (as of 10/31/15)

 

      1 Year      5 Years      10 Years  

Equity Income A1

     2.95%         13.09%         8.17%   

Equity Income A2

     -2.71%         11.81%         7.56%   

Equity Income B1

     2.82%         12.52%         7.48% 3 

Equity Income B2

     -2.09%         12.27%         7.48% 3 

Equity Income C1

     2.18%         12.26%         7.38%   

Equity Income C2

     1.20%         12.26%         7.38%   

Equity Income I1

     3.18%         13.40%         8.44%   

Equity Income R31

     2.61%         12.71%         7.91%   

Equity Income R41

     2.92%         13.05%         8.20%   

Equity Income R51

     3.22%         13.40%         8.50%   

Equity Income R61,4

     3.27%         13.52%         8.60%   

Equity Income Y1

     3.26%         13.52%         8.60%   

Russell 1000 Value Index

     0.53%         13.26%         6.75%   

 

1  Without sales charge
2  With sales charge
3  Class B shares convert to Class A shares after 8 years. The return shown reflects the conversion to Class A shares, which had different operating expenses for the period after conversion.
4  Inception: 11/07/2014.

PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND DOES NOT GUARANTEE FUTURE RESULTS. The investment return and principal value of the investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain performance data current to the most recent month-end, please visit our website www.hartfordfunds.com.

The initial investment in Class A shares reflects the maximum sales charge of 5.50% and returns for Class B shares reflect a contingent deferred sales charge of up to 5.00% and declining to zero, depending on the period of time the shares are held.

Returns for Class C shares reflect a contingent deferred sales charge of up to 1.00% on shares redeemed within twelve months of purchase.

Total returns presented above were calculated using the Fund’s net asset value available to shareholders for sale or redemption of Fund shares on October 31, 2015, which may exclude investment transactions as of this date. All share class returns assume the reinvestment of all distributions at net asset value and the deduction of all fund expenses.

Effective 9/30/09, Class B shares of the Fund were closed to new investments.

Class I shares commenced operations on 8/31/06. Performance prior to that date is that of the Fund’s Class A shares (excluding sales charges), which had different operating expenses. Class R3, R4 and R5 shares commenced operations on 12/22/06. Performance prior to that date is that of the Fund’s Class Y shares, which had different operating expenses. Class R6 shares commenced operations on 11/07/14. Performance prior to that date is that of the Fund’s Class Y shares.

Russell 1000 Value Index is an unmanaged index that measures the performance of those Russell 1000 Index companies with lower price-to-book ratios and lower forecasted growth values. The Russell 1000 Index is an unmanaged index that measures the performance of the 1,000 largest companies in the Russell 3000 Index, which measures the performance of the 3,000 largest U.S. companies, based on total market capitalizations.

You cannot invest directly in an index.

The chart and table do not reflect the deductions of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Performance information may reflect historical or current expense waivers/reimbursements from the investment adviser, without which performance would have been lower. For information on current expense waivers/reimbursements, please see the prospectus.

 

 

 

  11  

 


The Hartford Equity Income Fund

Manager Discussion

October 31, 2015 (Unaudited)

 

 

 

Operating Expenses*

 

      Net      Gross  

Equity Income Class A

     1.03%         1.03%   

Equity Income Class B

     1.91%         1.91%   

Equity Income Class C

     1.76%         1.76%   

Equity Income Class I

     0.76%         0.76%   

Equity Income Class R3

     1.37%         1.37%   

Equity Income Class R4

     1.06%         1.06%   

Equity Income Class R5

     0.76%         0.76%   

Equity Income Class R6

     0.66%         0.66%   

Equity Income Class Y

     0.66%         0.66%   

 

* Actual expenses may be higher or lower. Please see accompanying Financial Highlights for expense ratios for the year ended October 31, 2015.

Expense ratios are as shown in the most recent prospectus. Net expenses reflect contractual expense reimbursements in instances when these reductions reduce the Fund’s gross expenses. Contractual reimbursements remain in effect until February 29, 2016 and automatically renew for one-year terms unless terminated.

All investments are subject to risk including the possible loss of principal. For a discussion of the Fund’s risks, please see the Main Risks section of this report. For more detailed information on the risks associated with an investment in the Fund, please see the prospectus.

 

 

 

Portfolio Managers

W. Michael Reckmeyer, III, CFA

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

Karen H. Grimes, CFA

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

Ian R. Link, CFA

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

 

 

 

How did the Fund perform during the period?

The Class A shares of The Hartford Equity Income Fund returned 2.95%, before sales charge, for the twelve-month period ended October 31, 2015, outperforming the Fund’s benchmark, the Russell 1000 Value Index, which returned 0.53% for the same period. The Fund also outperformed the 0.20% average return of the Lipper Equity Income Funds peer group, a group of funds with investment strategies similar to those of the Fund.

Why did the Fund perform this way?

U.S. equities, as measured by the S&P 500 Index, rose during the twelve-month period. U.S. stocks finished 2014 with strong gains, retreated briefly early in 2015, but then reached new all-time highs on March 2, April 24, and May 21. The market pulled back in early March as soft manufacturing data, potentially negative currency- and oil-related earnings data, and valuation concerns weighed on investors’ minds. However, risk appetites increased after the March 18 Federal Open Market Committee statement underlined the U.S. Federal Reserve’s (Fed) hesitation to raise rates as U.S. domestic inflation remained subdued and other major central banks maintained an easing bias. In April, the tech-heavy Nasdaq Composite topped the 5,000 mark for the first time in 15 years and broke its closing record from March 2000. Continued strong merger and acquisition (M&A) activity, a rebound in hiring, and solid housing data helped to

fuel risk appetites. May marked the second-best month ever for M&A transactions involving U.S. companies with $234 billion in announced mergers. Stocks ended June on a sour note after negotiations between Greece and its creditors regarding Greece’s loan repayments broke down.

In the second half of the period, the U.S. economy remained on solid footing, with a sharp rebound in Gross Domestic Product (GDP), a seven-year low in unemployment, and a healthy housing market. While the growth slowdown in China and its implications for global commerce fueled investor anxiety during the second half of the period, uncertainty about the Fed’s rate hike timeline also weighed on sentiment. During August and September, the market remained extremely volatile and experienced its first correction (a decline of at least 10%) since October 2011. As many market participants expected, the Fed left rates unchanged at its highly anticipated September meeting. The Fed’s statement appeared to spook some investors as it acknowledged that “recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term.” U.S. equities ended the period with their best monthly return in four years during the month of October on the heels of strong corporate earnings and continued accommodative monetary policy across the globe.

 

 

 

  12  

 


The Hartford Equity Income Fund

Manager Discussion – (continued)

October 31, 2015 (Unaudited)

 

 

 

During the period six out of ten sectors within the Russell 1000 Value Index posted positive absolute returns, with Healthcare (+11%), Consumer Discretionary (+9%), and Financials (+4%) performing the best. Energy (-20%), Materials (-9%), and Utilities (-1%) lagged the index on a relative basis during the period. During the period, returns varied noticeably by market-cap, as small- and mid-cap stocks underperformed large-cap stocks.

Overall, outperformance versus the Russell 1000 Value Index was driven by strong security selection, primarily within the Information Technology and Consumer Staples sectors. This more than offset negative stock selection within Healthcare and Industrials. Sector allocation, driven by our bottom-up stock selection process, also contributed to relative returns during the period, primarily due to an underweight to Energy. This was partially offset by our underweight to Financials.

Top contributors to returns relative to the Russell 1000 Value Index included Kraft Foods (Consumer Staples), Home Depot (Consumer Discretionary), and Analog Devices (Information Technology). Shares of Kraft Foods, a U.S.-based food manufacturer and processor, rose on the back of news that Heinz is to take over the U.S. food manufacturer in a deal which will create one of North America’s biggest food companies and bring together some of the biggest household brands in the U.S., ranging from Heinz ketchup to Jell-O desserts. Shares of Analog Devices, a semiconductor company focused on industrial, communications, and automotive end-markets, rose based on strong earnings reports and recent discussion regarding a potential tie up between Maxim and Analog Devices. Shares of Home Depot, a U.S.-based home improvement retailer, rose due to release of earnings results and higher earnings guidance which exceeded investor expectations. Top absolute performance contributors for the period also included Microsoft (Information Technology).

Top detractors from relative performance during the period included Eaton Corp (Industrials), Marathon Oil (Energy), and UnitedHealth (Healthcare). Shares of Eaton Corp, a global diversified electrical equipment manufacturer, fell due to weaker-than-expected earnings results and outlook due to softness in the global industrial capital expenditures cycle. Shares of Marathon Oil, a U.S. exploration and production company moved lower during the period in conjunction with a protracted decline in oil prices, causing weaker than expected quarterly revenues. Shares of UnitedHealth, a U.S.-based health insurance company, rose based on strong earnings growth and positive fundamentals and outlook for 2016 earnings. Integration of the Catamaran pharmacy benefit management business has been accretive to the company’s Optum Rx business. Not owning this benchmark-constituent weighed on relative performance during the period. Top detractors from absolute performance also included Chevron (Energy).

Derivatives were not used in a significant manner in this Fund during the period and did not have a material impact on performance during the period.

What is the outlook?

Looking ahead, we are conscious that volatility is likely to remain elevated due to concerns about global growth. The market is focused on growth in China, where the government is applying a variety of stimulus measures to counteract the economic slowdown. Weakness has become apparent in Emerging Markets as well, and we have also seen effects of that weakness on export data from Germany. This may portend challenges for Europe more broadly. Geopolitical risk has also increased with uncertainty in the Middle East. Despite conditions that may make future growth difficult, our base case is for modest growth in the United States with improvement as we work through excess inventories in the Energy and Industrials sectors. Our view is that the energy markets are ultimately self-correcting which should take hold within the next 12-18 months and afford the Energy sector a reprieve.

In the meantime, U.S. consumer trends remain solid, and have the potential to buoy economic activity in other parts of the economy. At the end of the period, our largest overweights were to the Industrials, Utilities, and Healthcare sectors, while our largest underweights were to the Financials and Energy sectors, relative to the Russell 1000 Value Index.

Diversification by Sector

as of October 31, 2015

 

Sector    Percentage of
Net Assets
 

Equity Securities

  

Consumer Discretionary

     5.5

Consumer Staples

     7.4   

Energy

     11.2   

Financials

     24.3   

Health Care

     12.4   

Industrials

     12.8   

Information Technology

     11.7   

Materials

     2.2   

Telecommunication Services

     3.2   

Utilities

     8.2   
  

 

 

 

Total

     98.9
  

 

 

 

Short-Term Investments

     1.3   

Other Assets & Liabilities

     (0.2
  

 

 

 

Total

     100.0
  

 

 

 

A sector may be comprised of several industries. For Fund compliance purposes, the Fund may not use the same classification system and these sector classifications are used for financial reporting purposes.

 

 

 

  13  

 


The Hartford Growth Opportunities Fund inception 03/31/1963

 

(sub-advised by Wellington Management Company LLP)   Investment objective – The Fund seeks capital appreciation.

LOGO

The chart above represents the hypothetical growth of a $10,000 investment in Class A, which includes a sales charge. Growth results in classes other than Class A will vary from what is seen above due to differences in the expenses charged to those share classes.

 

Average Annual Total Returns (as of 10/31/15)

 

      1 Year      5 Years      10 Years  

Growth Opportunities A1

     12.72%         15.66%         9.28%   

Growth Opportunities A2

     6.52%         14.36%         8.66%   

Growth Opportunities B1

     11.72%         14.71%         8.61% 3 

Growth Opportunities B2

     7.40%         14.48%         8.61% 3 

Growth Opportunities C1

     11.95%         14.84%         8.50%   

Growth Opportunities C2

     11.09%         14.84%         8.50%   

Growth Opportunities I1

     12.99%         15.95%         9.60%   

Growth Opportunities R31

     12.39%         15.35%         9.08%   

Growth Opportunities R41

     12.70%         15.69%         9.40%   

Growth Opportunities R51

     13.02%         16.03%         9.67%   

Growth Opportunities R61,4

     13.10%         16.13%         9.77%   

Growth Opportunities Y1

     13.16%         16.14%         9.77%   

Russell 3000 Growth Index

     8.72%         15.16%         9.06%   

Russell 1000 Growth Index

     9.18%         15.30%         9.09%   

 

1  Without sales charge
2  With sales charge
3  Class B shares convert to Class A shares after 8 years. The return shown reflects the conversion to Class A shares, which had different operating expenses for the period after conversion.
4  Inception: 11/07/2014.

PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND DOES NOT GUARANTEE FUTURE RESULTS. The investment return and principal value of the investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain performance data current to the most recent month-end, please visit our website www.hartfordfunds.com.

The initial investment in Class A shares reflects the maximum sales charge of 5.50% and returns for Class B shares reflect a contingent deferred sales charge of up to 5.00% and declining to zero, depending on the period of time the shares are held.

Returns for Class C shares reflect a contingent deferred sales charge of up to 1.00% on shares redeemed within twelve months of purchase.

Total returns presented above were calculated using the Fund’s net asset value available to shareholders for sale or redemption of Fund shares on October 31, 2015, which may exclude investment transactions as of this date. All share class returns assume the reinvestment of all distributions at net asset value and the deduction of all fund expenses.

Effective 9/30/09, Class B shares of the Fund were closed to new investments.

Class I shares commenced operations on 8/31/06. Performance prior to that date is that of the Fund’s Class A shares (excluding sales charges), which had different operating expenses. Class R3, R4 and R5 shares commenced operations on 12/22/06. Performance prior to that date is that of the Fund’s Class Y shares, which had different operating expenses. Class R6 shares commenced operations on 11/07/14. Performance prior to that date is that of the Fund’s Class Y shares.

Russell 3000 Growth Index is an unmanaged index that measures the performance of those Russell 3000 Index companies with higher price-to-book ratios and higher forecasted growth values. The Russell 3000 Index is an unmanaged index that measures the performance of the 3,000 largest U.S. companies based on total market capitalization.

Russell 1000 Growth Index is an unmanaged index that measures the performance of those Russell 1000 Index companies with higher price-to-book ratios and higher forecasted growth values. The Russell 1000 Index is an unmanaged index that measures the performance of the 1,000 largest companies in the Russell 3000 Index, which measures the performance of the 3,000 largest U.S. companies based on total market capitalization.

You cannot invest directly in an index.

The chart and table do not reflect the deductions of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Performance information may reflect historical or current expense waivers/reimbursements from the investment adviser, without which performance would have been lower. For information on current expense waivers/reimbursements, please see the prospectus.

 

 

 

  14  

 


The Hartford Growth Opportunities Fund

Manager Discussion

October 31, 2015 (Unaudited)

 

 

 

Operating Expenses*

 

      Net      Gross  

Growth Opportunities Class A

     1.15%         1.15%   

Growth Opportunities Class B

     2.05%         2.07%   

Growth Opportunities Class C

     1.88%         1.88%   

Growth Opportunities Class I

     0.91%         0.91%   

Growth Opportunities Class R3

     1.45%         1.46%   

Growth Opportunities Class R4

     1.15%         1.15%   

Growth Opportunities Class R5

     0.85%         0.85%   

Growth Opportunities Class R6

     0.75%         0.75%   

Growth Opportunities Class Y

     0.75%         0.75%   

 

* Actual expenses may be higher or lower. Please see accompanying Financial Highlights for expense ratios for the year ended October 31, 2015.

Expense ratios are as shown in the most recent prospectus. Net expenses reflect contractual expense reimbursements in instances when these reductions reduce the Fund’s gross expenses. Contractual reimbursements remain in effect until February 29, 2016 and automatically renew for one-year terms unless terminated.

All investments are subject to risk including the possible loss of principal. For a discussion of the Fund’s risks, please see the Main Risks section of this report. For more detailed information on the risks associated with an investment in the Fund, please see the prospectus.

 

 

 

Portfolio Managers

Michael T. Carmen, CFA

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

Stephen Mortimer

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

Mario E. Abularach, CFA

Senior Managing Director and Equity Research Analyst

Wellington Management Company LLP

 

 

 

How did the Fund perform during the period?

The Class A shares of The Hartford Growth Opportunities Fund returned 12.72%, before sales charge, for the twelve-month period ended October 31, 2015, outperforming the Fund’s benchmarks, the Russell 1000 Growth Index and the Russell 3000 Growth Index, which returned 9.18% and 8.72%, respectively, for the same period. The Fund also outperformed the 5.48% average return of the Lipper Multi-Cap Growth Funds peer group, a group of funds with investment strategies similar to those of the Fund.

Why did the Fund perform this way?

U.S. equities, as measured by the S&P 500 Index, rose during the twelve-month period. U.S. stocks finished 2014 with strong gains, retreated briefly early in 2015, but then reached new all-time highs on March 2, April 24, and May 21. The market pulled back in early March as soft manufacturing data, potentially negative currency- and oil-related earnings data, and valuation concerns weighed on investors’ minds. However, risk appetites increased after the March 18 Federal Open Market Committee statement underlined the U.S. Federal Reserve’s (Fed) hesitation to raise rates as U.S. domestic inflation remained subdued and other major central banks maintained an easing bias. In April, the tech-heavy Nasdaq Composite topped the 5,000 mark for the first time in 15 years and broke its closing record from March 2000. Continued strong merger and acquisition

(M&A) activity, a rebound in hiring, and solid housing data helped to fuel risk appetites. May marked the second-best month ever for M&A transactions involving U.S. companies with $234 billion in announced mergers. Stocks ended June on a sour note after negotiations between Greece and its creditors regarding Greece’s loan repayments broke down.

In the second half of the period, the U.S. economy remained on solid footing, with a sharp rebound in Gross Domestic Product (GDP), a seven-year low in unemployment, and a healthy housing market. While the growth slowdown in China and its implications for global commerce fueled investor anxiety during the second half of the period, uncertainty about the Fed’s rate hike timeline also weighed on sentiment. During August and September, the market remained extremely volatile and experienced its first correction (a decline of at least 10%) since October 2011. As many market participants expected, the Fed left rates unchanged at its highly anticipated September meeting. The Fed’s statement appeared to spook some investors as it acknowledged that “recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term.” U.S. equities ended the period with their best monthly return in four years during the month of October on the heels of strong corporate earnings and continued accommodative monetary policy across the globe.

 

 

 

  15  

 


The Hartford Growth Opportunities Fund

Manager Discussion – (continued)

October 31, 2015 (Unaudited)

 

 

 

Six of the ten sectors in the Russell 3000 Growth Index rose during the period. Consumer Discretionary (+19%), Information Technology (+14%), and Consumer Staples (+14%) gained the most while Energy (-32%), Utilities (-8%), and Materials (-2%) declined over the period. During the period, returns varied noticeably by market-cap, as small- and mid-cap stocks underperformed large-cap stocks.

Strong security selection within Information Technology, Consumer Discretionary, and Healthcare was the primary driver of outperformance relative to the Russell 3000 Growth Index during the period, more than offsetting weak selection within Materials and Consumer Staples. Sector allocation, a result of our bottom-up stock selection process, also contributed to benchmark-relative performance due primarily to an underweight to Materials and Energy and an overweight to Information Technology. This was only partially offset by an underweight to Consumer Staples.

Top contributors to relative and absolute performance during the period included Amazon (Consumer Discretionary), Uber Technologies (Information Technology), and Netflix (Consumer Discretionary). Shares of Amazon, a U.S.-based leader in the online e-commerce industry, rose on healthy results from the U.S. retail side of the business. In addition, results have been driven by stronger than expected growth in Amazon Web Service (“AWS”). AWS is an early leader in the relatively small but fast growing segment of the cloud-computing services sector. The valuation of private placement Uber Technologies rose as the company has been expanding and growing at a rapid pace, penetrating new markets and increasing market share on a global scale. We initiated a position in Uber in 2014 and since that time the company has successfully completed additional rounds of financing at substantially increased valuations. With regard to the private placement nature of Uber, we attempt to mitigate the inherent risks in investing in these types of securities by investing only in companies that we expect will execute an IPO or liquidity event over a 1-3 year time horizon. Shares of Netflix, a U.S.-based provider of subscription service for television shows and movies via mail and digital streaming, rose due to improved marketing and content costs from global original content licensing, expectations for long-term subscriber growth, and earnings potential.

Top relative and absolute detractors from performance during the period included Platform Specialty (Materials), GoPro (Consumer Discretionary), and Baidu (Information Technology). Shares of Platform Specialty, a producer of specialty chemicals used by the electronics, agriculture, and offshore oil production and drilling industries, suffered as a result of global economic uncertainty and the potential impact it may have on the cyclical chemical industry. Shares of GoPro, a firm that produces action cameras, declined after the launch of its new improved HERO4 session camera did not perform as well as expected. The disappointing sales resulted in a reduction in earnings estimates going forward. Shares of China-based internet search provider Baidu underperformed as the company reported 2014 fourth quarter earnings and 2015 first and second quarter earnings that were lower than

consensus estimates. Lower earnings were driven by higher than expected selling, general, and administrative expenses, and revenue guidance was below expectations. The stock’s price was also affected by an overall sell-off in Chinese stocks following the devaluation of the Chinese renminbi and concerns about the overall growth rate of the Chinese economy.

Derivatives were not used in a significant manner in this Fund during the period and did not have a material impact on performance during the period.

What is the outlook?

The market volatility in the third quarter of 2015 provided us the opportunity to add some higher quality companies at attractive prices within industries displaying positive growth trends in our opinion. We believe equity markets will ultimately reward quality growth-oriented companies that are attractively valued and provide the potential for future growth for the portfolio. We strongly believe that the portfolio is well-positioned for future growth, but will continue to make new investments when given the opportunity. When the market environment becomes more challenging or when rates begin to rise, these investment opportunities may be found in non-traditional growth sectors.

At the end of the period, the Fund’s largest sector overweights were to Healthcare, Financials, and Information Technology, while our largest underweights were to Consumer Staples, Industrials, and Materials.

Diversification by Sector

as of October 31, 2015

 

Sector    Percentage of
Net Assets
 

Equity Securities

  

Consumer Discretionary

     17.8

Consumer Staples

     6.1   

Energy

     1.4   

Financials

     9.5   

Health Care

     22.0   

Industrials

     8.3   

Information Technology

     30.3   

Materials

     1.3   
  

 

 

 

Total

     96.7
  

 

 

 

Short-Term Investments

     3.6   

Other Assets & Liabilities

     (0.3
  

 

 

 

Total

     100.0
  

 

 

 

A sector may be comprised of several industries. For Fund compliance purposes, the Fund may not use the same classification system and these sector classifications are used for financial reporting purposes.

 

 

 

  16  

 


The Hartford Healthcare Fund inception 05/01/2000

 

(sub-advised by Wellington Management Company LLP)   Investment objective – The Fund seeks long-term capital appreciation.

LOGO

The chart above represents the hypothetical growth of a $10,000 investment in Class A, which includes a sales charge. Growth results in classes other than Class A will vary from what is seen above due to differences in the expenses charged to those share classes.

 

Average Annual Total Returns (as of 10/31/15)

 

      1 Year      5 Years      10 Years  

Healthcare A1

     13.19%         22.19%         12.15%   

Healthcare A2

     6.96%         20.81%         11.52%   

Healthcare B1

     12.23%         21.16%         11.45% 3 

Healthcare B2

     7.23%         20.98%         11.45% 3 

Healthcare C1

     12.40%         21.33%         11.35%   

Healthcare C2

     11.40%         21.33%         11.35%   

Healthcare I1

     13.51%         22.57%         12.48%   

Healthcare R31

     12.85%         21.89%         11.95%   

Healthcare R41

     13.19%         22.26%         12.29%   

Healthcare R51

     13.52%         22.63%         12.59%   

Healthcare Y1

     13.64%         22.74%         12.67%   

S&P North American Health Care Sector Index

     7.54%         21.04%         11.63%   

S&P 500 Index

     5.20%         14.33%         7.85%   

 

1  Without sales charge
2  With sales charge
3  Class B shares convert to Class A shares after 8 years. The return shown reflects the conversion to Class A shares, which had different operating expenses for the period after conversion.

PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND DOES NOT GUARANTEE FUTURE RESULTS. The investment return and principal value of the investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain performance data current to the most recent month-end, please visit our website www.hartfordfunds.com.

The initial investment in Class A shares reflects the maximum sales charge of 5.50% and returns for Class B shares reflect a contingent deferred sales charge of up to 5.00% and declining to zero, depending on the period of time the shares are held.

Returns for Class C shares reflect a contingent deferred sales charge of up to 1.00% on shares redeemed within twelve months of purchase.

Total returns presented above were calculated using the Fund’s net asset value available to shareholders for sale or redemption of Fund shares on October 31, 2015, which may exclude investment transactions as of this date. All share class returns assume the reinvestment of all distributions at net asset value and the deduction of all fund expenses.

Effective 9/30/09, Class B shares of the Fund were closed to new investments.

Class I shares commenced operations on 8/31/06. Performance prior to that date is that of the Fund’s Class A shares (excluding sales charges), which had different operating expenses. Class R3, R4 and R5 shares commenced operations on 12/22/06. Performance prior to that date is that of the Fund’s Class Y shares, which had different operating expenses.

S&P North American Health Care Sector Index is a modified capitalization-weighted index based on United States headquartered health care companies. Stocks in the index are weighted such that each stock is no more than 7.5% of the market capitalization as of the most recent reconstitution date. The companies included in the index must be common stocks and be traded on the NYSE MKT LLC, Nasdaq or the New York Stock Exchange and meet certain established market capitalization levels.

S&P 500 Index is a market capitalization-weighted price index composed of 500 widely held common stocks.

You cannot invest directly in an index.

The chart and table do not reflect the deductions of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Performance information may reflect historical or current expense waivers/reimbursements from the investment adviser, without which performance would have been lower. For information on current expense waivers/reimbursements, please see the prospectus.

 

 

 

  17  

 


The Hartford Healthcare Fund

Manager Discussion

October 31, 2015 (Unaudited)

 

 

 

Operating Expenses*

 

      Net     Gross  

Healthcare Class A

     1.33     1.33

Healthcare Class B

     2.20     2.20

Healthcare Class C

     2.06     2.06

Healthcare Class I

     1.05     1.05

Healthcare Class R3

     1.64     1.64

Healthcare Class R4

     1.34     1.34

Healthcare Class R5

     1.05     1.05

Healthcare Class Y

     0.94     0.94

 

* Actual expenses may be higher or lower. Please see accompanying Financial Highlights for expense ratios for the year ended October 31, 2015.

Expense ratios are as shown in the most recent prospectus. Net expenses reflect contractual expense reimbursements in instances when these reductions reduce the Fund’s gross expenses. Contractual reimbursements remain in effect until February 29, 2016 and automatically renew for one-year terms unless terminated.

All investments are subject to risk including the possible loss of principal. For a discussion of the Fund’s risks, please see the Main Risks section of this report. For more detailed information on the risks associated with an investment in the Fund, please see the prospectus.

 

 

 

Portfolio Managers

Jean M. Hynes, CFA

Senior Managing Director and Global Industry Analyst

Wellington Management Company LLP

Ann C. Gallo

Senior Managing Director and Global Industry Analyst

Wellington Management Company LLP

Kirk J. Mayer, CFA

Senior Managing Director and Global Industry Analyst

Wellington Management Company LLP

Robert L. Deresiewicz

Senior Managing Director and Global Industry Analyst

Wellington Management Company LLP

 

 

 

How did the Fund perform during the period?

The Class A shares of The Hartford Healthcare Fund returned 13.19%, before sales charge, for the twelve-month period ended October 31, 2015, outperforming the Fund’s benchmark, the S&P North American Health Care Sector Index, which returned 7.54% for the same period. The Fund also outperformed the S&P 500 Index, which returned 5.20% for the same period. The Fund outperformed the 10.43% average return of the Lipper Global Health and Biotechnology peer group, a group of funds with investment strategies similar to those of the Fund.

Why did the Fund perform this way?

Health care stocks (+8%) outperformed both the broader U.S. market (+5%) and the global equity market (+2%) during the period, as measured by the S&P North American Health Care Sector, S&P 500, and the MSCI World Indices respectively. However, the S&P North American Health Care Sector Index fell 11.5% in U.S. dollar terms during the third quarter, underperforming the broader U.S. market (-6.4% as measured by the S&P 500 Index). We believe Presidential candidate Hilary Clinton’s comments on controlling drug pricing and the push for lower prescription drug costs caused extreme

weakness across the industry. The biotech sector was hit the hardest in the third quarter, knocking out much of the gains achieved year to date.

Within the S&P North American Healthcare Sector Index, four of the five sub-sectors posted positive absolute returns during the period. Health care services (+12%) and medical technology (+9%) led while biopharma large-cap (+5%) biopharma mid-cap (+4%), and biopharma small-cap (-11%) lagged the broader health care index.

The Fund outperformed the S&P North American Health Care Sector Index due to positive stock selection while sector allocation modestly detracted from relative performance during the period. Security selection was strongest in biopharma names across large-cap, mid-cap, and small-cap during the period. Selection was positive in health care services as well, while selection in the medical technology sector detracted during the period. Overweight allocations to health services and medical technology as well as an underweight to large-cap biopharma contributed to relative performance over the period. However, overweight allocations to small-cap biopharma and mid-cap biopharma detracted from results relative to the S&P North American Health Care Sector Index. A modest cash position in an upward trending market environment detracted from relative results during the period.

 

 

 

  18  

 


The Hartford Healthcare Fund

Manager Discussion – (continued)

October 31, 2015 (Unaudited)

 

 

 

Holdings of Anacor Pharmaceuticals (biopharma mid-cap), Galapagos (biopharma small-cap), and Shionogi & Company (biopharma large-cap) contributed most to results relative to the S&P North American Health Care Sector Index. Anacor Pharmaceuticals, a company focused on small molecule therapeutics, was the top absolute and benchmark-relative contributor to performance during the period. Shares of the company benefited from positive sales momentum built by the company’s marketing partner, Novartis, for Anacor’s toenail-fungus-fighting drug Kerydin. Shares of Galapagos NV, a Belgium-based biotechnology company, outperformed over the period based on positive top-line data from a phase 1 study of a drug for the treatment of cystic fibrosis. Shares of Shionogi, a Japan-based pharmaceutical company, rose during the period, driven by continued expansion of its HIV treatments.

Pfizer (biopharma large-cap), Regulus Therapeutics (biopharma small-cap), and Arena Pharmaceutical (biopharma small-cap) were the top detractors from benchmark-relative performance over the period. Not holding shares of global biopharmaceutical company Pfizer detracted from returns relative to the S&P North American Health Care Sector Index during the period as the benchmark component has performed well and we did not hold a position in the portfolio during the period. Performance of U.S.-based Regulus, a biopharmaceutical company focused on discovering and developing microRNAs to treat a range of diseases, was weak during the period as a result of management turnover, but we view the data from their Hepatitis C drug candidate to be encouraging. Arena Pharmaceuticals has also been a detractor over the time period as prescriptions for their obesity drug, Belviq, have come in below expectations.

Derivatives were not used in a significant manner in this Fund during the period and did not have a material impact on performance during the period.

What is the outlook?

Looking forward, we expect continued volatility heading into the presidential election season. We suspect that the correction in health care stocks is not over, but we are optimistic that the worst is behind us and that the re-rating has created some attractive buying opportunities. While we believe that headline headwinds will continue, we do not see a path by which the government could institute universal price controls, especially in the near to mid-term. We firmly believe that truly innovative drugs will continue to be warmly embraced by the marketplace and will continue to command high prices.

For this period of market turmoil, our strategy is unchanged: namely, to identify what we consider to be innovative companies that offer meaningful value to the healthcare system. In the biopharma space, our current preference, on the margin, is for mature companies with strong revenue growth, ample cash, and innovative and exciting pipelines. In healthcare products and services, we seek companies

that will benefit from and/or facilitate the transition from a fee-for-service-based to a fee-for-value-based healthcare system.

We still remain optimistic about the health care sector overall. We believe that biomedical innovation is as robust as it has ever been and should fuel a decade or more of strong earnings growth for the most successful biopharmaceutical companies. Evolving structures of healthcare markets globally should create clear performance separation between the best and the worst health care services companies. We believe that our approach of evaluating secular themes across a long time horizon will enable us to capitalize on these trends. As is our practice, we will aim to trim stocks on strength and to add on weakness in order to seek to generate favorable returns and to minimize risk.

Diversification by Sector

as of October 31, 2015

 

Sector    Percentage of
Net Assets
 

Equity Securities

  

Consumer Staples

     2.2

Health Care

     94.1   

Information Technology

     0.3   
  

 

 

 

Total

     96.6
  

 

 

 

Short-Term Investments

     3.1   

Other Assets & Liabilities

     0.3   
  

 

 

 

Total

     100.0
  

 

 

 

A sector may be comprised of several industries. For Fund compliance purposes, the Fund may not use the same classification system and these sector classifications are used for financial reporting purposes.

 

 

 

  19  

 


The Hartford MidCap Fund inception 12/31/1997

 

(sub-advised by Wellington Management Company LLP)   Investment objective – The Fund seeks long-term growth of capital.

LOGO

The chart above represents the hypothetical growth of a $10,000 investment in Class A, which includes a sales charge. Growth results in classes other than Class A will vary from what is seen above due to differences in the expenses charged to those share classes.

 

Average Annual Total Returns (as of 10/31/15)

 

      1 Year      5 Years      10 Years  

MidCap A1

     7.28%         14.12%         9.59%   

MidCap A2

     1.38%         12.83%         8.98%   

MidCap B1

     6.28%         13.12%         8.89% 3 

MidCap B2

     1.63%         12.87%         8.89% 3 

MidCap C1

     6.46%         13.31%         8.84%   

MidCap C2

     5.52%         13.31%         8.84%   

MidCap I1

     7.52%         14.41%         9.80%   

MidCap R31

     6.91%         13.79%         9.58%   

MidCap R41

     7.26%         14.14%         9.79%   

MidCap R51

     7.59%         14.48%         10.01%   

MidCap R61,4

     7.69%         14.61%         10.08%   

MidCap Y1

     7.66%         14.60%         10.08%   

S&P MidCap 400 Index

     3.42%         13.41%         9.09%   

 

1  Without sales charge
2  With sales charge
3 Class B shares convert to Class A shares after 8 years. The return shown reflects the conversion to Class A shares, which had different operating expenses for the period after conversion.
4  Inception: 11/07/2014.

PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND DOES NOT GUARANTEE FUTURE RESULTS. The investment return and principal value of the investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain performance data current to the most recent month-end, please visit our website www.hartfordfunds.com.

The initial investment in Class A shares reflects the maximum sales charge of 5.50% and returns for Class B shares reflect a contingent deferred sales charge of up to 5.00% and declining to zero, depending on the period of time the shares are held.

Returns for Class C shares reflect a contingent deferred sales charge of up to 1.00% on shares redeemed within twelve months of purchase.

Total returns presented above were calculated using the Fund’s net asset value available to shareholders for sale or redemption of Fund shares on October 31, 2015, which may exclude investment transactions as of this date. All share class returns assume the reinvestment of all distributions at net asset value and the deduction of all fund expenses.

Effective 9/30/09, Class B shares of the Fund were closed to new investments.

Class I shares commenced operations on 2/27/09. Performance prior to that date is that of the Fund’s Class A shares (excluding sales charges), which had different operating expenses. Class R3, R4 and R5 shares commenced operations on 5/29/09. Performance prior to that date is that of the Fund’s Class Y shares which had different operating expenses. Class R6 shares commenced operations on 11/07/14. Performance prior to that date is that of the Fund’s Class Y shares.

S&P MidCap 400 Index is an unmanaged index of common stocks of companies chosen by S&P designed to represent price movements in the mid-cap U.S. equity market.

You cannot invest directly in an index.

The chart and table do not reflect the deductions of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Performance information may reflect historical or current expense waivers/reimbursements from the investment adviser, without which performance would have been lower. For information on current expense waivers/reimbursements, please see the prospectus.

 

 

 

  20  

 


The Hartford MidCap Fund

Manager Discussion

October 31, 2015 (Unaudited)

 

 

 

Operating Expenses*

 

      Net      Gross  

MidCap Class A

     1.15%         1.15%   

MidCap Class B

     2.05%         2.05%   

MidCap Class C

     1.88%         1.88%   

MidCap Class I

     0.90%         0.90%   

MidCap Class R3

     1.47%         1.47%   

MidCap Class R4

     1.16%         1.16%   

MidCap Class R5

     0.86%         0.86%   

MidCap Class R6

     0.76%         0.76%   

MidCap Class Y

     0.76%         0.76%   

 

* Actual expenses may be higher or lower. Please see accompanying Financial Highlights for expense ratios for the year ended October 31, 2015.

Expense ratios are as shown in the most recent prospectus. Net expenses reflect contractual expense reimbursements in instances when these reductions reduce the Fund’s gross expenses. Contractual reimbursements remain in effect until February 29, 2016 and automatically renew for one-year terms unless terminated.

All investments are subject to risk including the possible loss of principal. For a discussion of the Fund’s risks, please see the Main Risks section of this report. For more detailed information on the risks associated with an investment in the Fund, please see the prospectus.

 

 

 

Portfolio Managers

Philip W. Ruedi, CFA

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

Mark A. Whitaker, CFA

Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

 

 

 

How did the Fund perform during the period?

The Class A shares of The Hartford MidCap Fund returned 7.28%, before sales charge, for the twelve-month period ended October 31, 2015, outperforming the Fund’s benchmark, the S&P MidCap 400 Index, which returned 3.42% for the same period. The Fund also outperformed the 2.43% average return of the Lipper Mid-Cap Growth Funds peer group, a group of funds with investment strategies similar to those of the Fund.

Why did the Fund perform this way?

U.S. equities, as measured by the S&P 500 Index, rose during the twelve-month period. U.S. stocks finished 2014 with strong gains, retreated briefly early in 2015, but then reached new all-time highs on March 2, April 24, and May 21. The market pulled back in early March as soft manufacturing data, potentially negative currency- and oil-related earnings data, and valuation concerns weighed on investors’ minds. However, risk appetites increased after the March 18 Federal Open Market Committee statement underlined the U.S. Federal Reserve’s (Fed) hesitation to raise rates as U.S. domestic inflation remained subdued and other major central banks maintained an easing bias. In April, the tech-heavy Nasdaq Composite topped the 5,000 mark for the first time in 15 years and broke its closing record from March 2000. Continued strong merger and acquisition activity (M&A), a rebound in hiring, and solid housing data helped to fuel risk appetites. May marked the second-best month ever for M&A transactions involving U.S. companies with $234 billion in announced mergers. Stocks ended June on a sour note after negotiations between Greece and its creditors regarding Greece’s loan repayments broke down.

In the second half of the period, the U.S. economy remained on solid footing, with a sharp rebound in Gross Domestic Product (GDP), a seven-year low in unemployment, and a healthy housing market. While the growth slowdown in China and its implications for global commerce fueled investor anxiety during the second half of the period, uncertainty about the Fed’s rate hike timeline also weighed on sentiment. During August and September, the market remained extremely volatile and experienced its first correction (a decline of at least 10%) since October 2011. As many market participants expected, the Fed left rates unchanged at its highly anticipated September meeting. The Fed’s statement appeared to spook some investors as it acknowledged that “recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term.” U.S. equities ended the period with their best monthly return in four years during the month of October on the heels of strong corporate earnings and continued accommodative monetary policy across the globe. During the period, returns varied noticeably by market-cap, as small- and mid-cap stocks underperformed large-cap stocks. Within the S&P MidCap 400 Index, six of the ten sectors posted positive returns. The Healthcare (+15%), Information Technology (+12%), and Consumer Staples, (+9%) sectors performed best while Energy (-33%) and Materials (-8%) lagged.

The Fund outperformed the S&P MidCap 400 Index during the period primarily as a result of strong security selection. Stock selection was strongest in the Industrials, Financials, and Healthcare sectors, which more than offset negative stock selection in Information Technology.

 

 

 

  21  

 


The Hartford MidCap Fund

Manager Discussion – (continued)

October 31, 2015 (Unaudited)

 

 

 

Sector allocation, a result of our bottom up stock selection process, also contributed during the period due primarily to an overweight to the Healthcare sector and underweight to the Materials sectors. Our overweight to Energy and underweight to Financials detracted on a relative basis.

Top contributors to performance relative to the S&P MidCap 400 Index included Vantiv (Information Technology), Equifax (Industrials), and Genpact (Information Technology). Shares of Vantiv, a provider of electronic payments processing services to merchants and financial institutions, outperformed as the company reported strong results based on improved consumer spending and synergies from a recent acquisition. Shares of Equifax, a U.S.-based credit rating agency, outperformed during the period due to acceleration in growth of all its business segments, favorable mortgage market conditions, and the smooth integration of recent acquisitions. Shares of Genpact, a business process outsourcing company, outperformed due to benefits of recent investments in growth and booking large new customers. Top absolute contributors for the period included Alkermes (Information Technology).

Top relative detractors included Harley-Davidson (Consumer Discretionary), Skyworks Solutions (Information Technology), and Genesee & Wyoming (Industrials). Shares of Harley-Davidson, a U.S.-based motorcycle manufacturer, underperformed as its retail business is shrinking faster than expected. Skyworks Solutions, a U.S.-based semiconductor supplier with products sold to manufacturers of smart phones and other mobile devices, rose due to the success of the iPhone 6. Not owning this S&P MidCap 400 Index component stock weighed on relative performance during the period. Shares of Genesee & Wyoming, a short line railroad operator, declined during the period due to concerns about carload weakness in commodities segments such as coal, steel, and iron ore. Top absolute detractors included Apollo Education (Consumer Discretionary).

Derivatives were not used in a significant manner in this Fund during the period and did not have a material impact on performance during the period.

What is the outlook?

We are carefully managing our portfolio positioning to seek to capture what we believe are attractive opportunities. Healthcare remains an overweight, but we are increasingly finding opportunities in other sectors as drug pricing comes under greater scrutiny during this Presidential election season. We are also overweight Industrials where we hold what we believe to be market leading companies in the transportation, waste disposal, staffing, and credit rating industries. We continue to believe that our IT sector holdings should benefit from the growth of the “cloud,” data services, and electronic payments. Our financial holdings consist of what we believe to be well-managed regional banks and insurance companies, as well as

some blue chip financial services companies. We continue to find real estate investment trusts unattractive based on relative valuation.

Diversification by Sector

as of October 31, 2015

 

Sector    Percentage of
Net Assets
 

Equity Securities

  

Consumer Discretionary

     11.0

Consumer Staples

     2.4   

Energy

     6.1   

Financials

     15.7   

Health Care

     16.1   

Industrials

     21.7   

Information Technology

     21.8   

Materials

     2.9   

Utilities

     2.0   
  

 

 

 

Total

     99.7
  

 

 

 

Short-Term Investments

     0.3   

Other Assets & Liabilities

     0.0   
  

 

 

 

Total

     100.0
  

 

 

 

A sector may be comprised of several industries. For Fund compliance purposes, the Fund may not use the same classification system and these sector classifications are used for financial reporting purposes.

 

 

 

  22  

 


The Hartford MidCap Value Fund inception 04/30/2001

 

(sub-advised by Wellington Management Company LLP)   Investment objective – The Fund seeks long-term capital appreciation.

LOGO

The chart above represents the hypothetical growth of a $10,000 investment in Class A, which includes a sales charge. Growth results in classes other than Class A will vary from what is seen above due to differences in the expenses charged to those share classes.

 

Average Annual Total Returns (as of 10/31/15)

 

      1 Year      5 Years      10 Years  

MidCap Value A1

     2.28%         12.38%         8.42%   

MidCap Value A2

     -3.35%         11.12%         7.81%   

MidCap Value B1

     1.37%         11.49%         7.80% 3 

MidCap Value B2

     -3.04%         11.23%         7.80% 3 

MidCap Value C1

     1.45%         11.56%         7.62%   

MidCap Value C2

     0.57%         11.56%         7.62%   

MidCap Value I1

     2.57%         12.76%         8.63%   

MidCap Value R31

     1.97%         12.11%         8.50%   

MidCap Value R41

     2.26%         12.46%         8.68%   

MidCap Value R51

     2.62%         12.81%         8.85%   

MidCap Value Y1

     2.73%         12.91%         8.90%   

Russell 2500 Value Index

     -1.06%         11.92%         7.25%   

Russell MidCap Value Index

     0.47%         13.64%         8.39%   

 

1 Without sales charge
2  With sales charge
3  Class B shares convert to Class A shares after 8 years. The return shown reflects the conversion to Class A shares, which had different operating expenses for the period after conversion.

PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND DOES NOT GUARANTEE FUTURE RESULTS. The investment return and principal value of the investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain performance data current to the most recent month-end, please visit our website www.hartfordfunds.com.

The initial investment in Class A shares reflects the maximum sales charge of 5.50% and returns for Class B shares reflect a contingent deferred sales charge of up to 5.00% and declining to zero, depending on the period of time the shares are held.

Returns for Class C shares reflect a contingent deferred sales charge of up to 1.00% on shares redeemed within twelve months of purchase.

Total returns presented above were calculated using the Fund’s net asset value available to shareholders for sale or redemption of Fund shares on October 31, 2015, which may exclude investment transactions as of this date. All share class returns assume the reinvestment of all distributions at net asset value and the deduction of all fund expenses.

Effective 9/30/09, Class B shares of the Fund were closed to new investments.

Class I shares commenced operations on 5/28/10. Performance prior to that date is that of the Fund’s Class A shares (excluding sales charges), which had different operating expenses. Class R3, R4 and R5 shares commenced operations on 5/28/10. Performance prior to that date is that of the Fund’s Class Y shares which had different operating expenses.

Russell 2500 Value Index is an unmanaged index that measures the performance of those Russell 2500 Index companies with lower price-to-book ratios and lower forecasted growth values. The Russell 2500 Index is an unmanaged index that measures the performance of the 2,500 smallest U.S. companies based on total market capitalization.

Russell MidCap Value Index measures the performance of the mid-cap value segment of the U.S. equity universe. It includes those Russell MidCap Index companies with lower price-to-book ratios and lower forecasted growth values.

You cannot invest directly in an index.

The chart and table do not reflect the deductions of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Performance information may reflect historical or current expense waivers/reimbursements from the investment adviser, without which performance would have been lower. For information on current expense waivers/reimbursements, please see the prospectus.

 

 

 

  23  

 


The Hartford MidCap Value Fund

Manager Discussion

October 31, 2015 (Unaudited)

 

 

 

Operating Expenses*

 

      Net      Gross  

MidCap Value Class A

     1.27%         1.27%   

MidCap Value Class B

     2.10%         2.28%   

MidCap Value Class C

     1.99%         1.99%   

MidCap Value Class I

     0.92%         0.92%   

MidCap Value Class R3

     1.53%         1.53%   

MidCap Value Class R4

     1.22%         1.22%   

MidCap Value Class R5

     0.93%         0.93%   

MidCap Value Class Y

     0.82%         0.82%   

 

* Actual expenses may be higher or lower. Please see accompanying Financial Highlights for expense ratios for the year ended October 31, 2015.

Expense ratios are as shown in the most recent prospectus. Net expenses reflect contractual expense reimbursements in instances when these reductions reduce the Fund’s gross expenses. Contractual reimbursements remain in effect until February 29, 2016 and automatically renew for one-year terms unless terminated.

All investments are subject to risk including the possible loss of principal. For a discussion of the Fund’s risks, please see the Main Risks section of this report. For more detailed information on the risks associated with an investment in the Fund, please see the prospectus.

 

 

 

Portfolio Manager

James N. Mordy

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

 

 

 

How did the Fund perform during the period?

The Class A shares of The Hartford MidCap Value Fund returned 2.28%, before sales charge, for the twelve-month period ended October 31, 2015, outperforming the Fund’s benchmarks, the Russell 2500 Value Index and the Russell MidCap Value Index, which returned -1.06% and 0.47%, respectively, for the same period. The Fund also outperformed the 1.02% average return of the Lipper Mid-Cap Core Fund peer group, a group of funds with investment strategies similar to those of the Fund.

Why did the Fund perform this way?

U.S. equities, as measured by the S&P 500 Index, rose during the twelve-month period. U.S. stocks finished 2014 with strong gains, retreated briefly early in 2015, but then reached new all-time highs on March 2, April 24, and May 21. The market pulled back in early March as soft manufacturing data, potentially negative currency- and oil-related earnings data, and valuation concerns weighed on investors’ minds. However, risk appetites increased after the March 18 Federal Open Market Committee statement underlined the U.S. Federal Reserve’s (Fed) hesitation to raise rates as U.S. domestic inflation remained subdued and other major central banks maintained an easing bias. In April, the tech-heavy Nasdaq Composite topped the 5,000 mark for the first time in 15 years and broke its closing record from March 2000. Continued strong merger and acquisition (M&A) activity, a rebound in hiring, and solid housing data helped to fuel risk appetites. May marked the second-best month ever for M&A transactions involving U.S. companies with $234 billion in announced mergers. Stocks ended June on a sour note after negotiations between Greece and its creditors regarding Greece’s loan repayments broke down.

In the second half of the period, the U.S. economy remained on solid footing, with a sharp rebound in Gross Domestic Product (GDP), a

seven-year low in unemployment, and a healthy housing market. While the growth slowdown in China and its implications for global commerce fueled investor anxiety during the second half of the period, uncertainty about the Fed’s rate hike timeline also weighed on sentiment. During August and September, the market remained extremely volatile and experienced its first correction (a decline of at least 10%) since October 2011. As many market participants expected, the Fed left rates unchanged at its highly anticipated September meeting. The Fed’s statement appeared to spook some investors as it acknowledged that “recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term.” U.S. equities ended the period with their best monthly return in four years during the month of October on the heels of strong corporate earnings and continued accommodative monetary policy across the globe.

During the period, returns varied noticeably by market-cap, as small- and mid-cap stocks underperformed large-cap stocks. Seven of the ten sectors in the Russell 2500 Value Index gained during the period, with Consumer Staples (+11%), Healthcare (+9%), and Financials (+6%) performing the best, while Energy (-44%) and Materials (-17%) lagged during the period.

The Fund’s relative outperformance versus the Russell 2500 Value Index over the twelve-month period was driven primarily by strong security selection within Energy, Consumer Discretionary, and Financials, which more than offset unfavorable stock selection within Industrials. Overall sector allocation, a result of the stock selection process, detracted from relative returns, in part due to an underweight to the Financials sector and overweights in Materials. Overweights to the Information Technology and Healthcare sectors

 

 

 

  24  

 


The Hartford MidCap Value Fund

Manager Discussion – (continued)

October 31, 2015, (Unaudited)

 

 

 

contributed to performance relative to the Russell 2500 Value Index during the period.

Top contributors to both absolute returns and returns relative to the Russell 2500 Value Index included Norwegian Cruise Line (Consumer Discretionary), Ono Pharmaceutical (Healthcare), and Microsemi (Information Technology). Shares of Norwegian Cruise Line, a diversified cruise operator, rose during the period due to a favorable industry outlook with controlled capacity growth, solid advance bookings for 2016, and new markets opening up in China and Cuba. In addition, a new CEO at Norwegian is focused on opportunities to drive up revenue yields. Shares of Ono Pharmaceutical, a Japan-based biopharmaceutical company, rose as its partner, Bristol-Myers Squibb, won approval for its key immuno-oncology drug, Opdivo, for second line treatment of non-small-cell lung cancer. Shares of Microsemi, a U.S.-based analog and mixed signal semiconductor manufacturer, rose during the period after the firm introduced its second generation highly secure 64 gigabyte solid state drive.

Top detractors to both absolute returns and returns relative to the Russell 2500 Value Index included Methanex (Materials), Trican Well Services (Energy), and Wesco International (Industrials). Shares of Methanex, a Canada-based producer of methanol, fell during the period as lower oil prices pressured methanol prices which have further compressed the company’s earnings. Shares of Trican Well Services, a North American supplier of pressure pumping services to the oil and gas industry, fell during the period. Prospects for 2015 eroded much more quickly than we envisioned, and the company was forced to sell assets to provide cushion against debt covenants. Shares of Wesco International, a distributor of industrial cabling, electrical, and lighting products, fell after the company reduced forward earnings guidance as their industrial and construction end markets are suffering from weak commodity prices and the strong U.S. dollar (USD).

Derivatives were not used in a significant manner in this Fund during the period and did not have a material impact on performance during the period.

What is the outlook?

Looking ahead, we expect to see more evidence of wage pressures in the U.S. and therefore feel that in the absence of further global deterioration the Fed may have to raise rates in the next few months. In a slow growth environment, we believe the trajectory of rate increases may be limited. Our marginally more restrained view of growth prospects is the main reason we have increased our real estate investment trust (REIT) position, slightly trimmed our cyclical overweight, and maintained overweight positions in areas like housing and the Consumer Discretionary sector where we have higher conviction. While the U.S. appears to be in a more mature phase of the economic cycle, we do not believe a recession is imminent. As such, a lot of market damage seems to have already

been done across the cyclical and traditional value sectors. The market appears to be doing a better job of discounting the uncertainties, and this keeps us from wanting to get even more defensive at this time. At the end of the period, our largest overweight allocations relative to the Russell 2500 Value Index were in Consumer Discretionary, Materials, and Information Technology, while our largest underweights continued to be in Financials and Utilities.

Diversification by Sector

as of October 31, 2015

 

Sector    Percentage of
Net Assets
 

Equity Securities

  

Consumer Discretionary

     15.4

Consumer Staples

     1.7   

Energy

     6.5   

Financials

     31.1   

Health Care

     5.1   

Industrials

     13.2   

Information Technology

     11.5   

Materials

     7.9   

Utilities

     5.9   
  

 

 

 

Total

     98.3
  

 

 

 

Short-Term Investments

     1.7   

Other Assets & Liabilities

     0.0   
  

 

 

 

Total

     100.0
  

 

 

 

A sector may be comprised of several industries. For Fund compliance purposes, the Fund may not use the same classification system and these sector classifications are used for financial reporting purposes.

 

 

 

  25  

 


Hartford Small Cap Core Fund* inception 01/01/2005

 

 

(sub-advised by Wellington Management Company LLP)

  Investment objective – The Fund seeks long-term capital appreciation.

LOGO

The chart above represents the hypothetical growth of a $10,000 investment in Class A, which includes a sales charge. Growth results in classes other than Class A will vary from what is seen above due to differences in the expenses charged to those share classes.

 

Average Annual Total Returns (as of 10/31/15)

 

      1 Year      5 Years      10 Years  

Small Cap Core A1

     -1.17%         11.53%         6.82%   

Small Cap Core A2

     -6.60%         10.27%         6.21%   

Small Cap Core B1

     -1.92%         10.67%         6.29% 3 

Small Cap Core B2

     -6.33%         10.41%         6.29% 3 

Small Cap Core C1

     -1.86%         10.68%         6.05%   

Small Cap Core C2

     -2.74%         10.68%         6.05%   

Small Cap Core I1,4

     -0.93%         11.58%         6.84%   

Small Cap Core R31

     -1.29%         11.45%         6.99%   

Small Cap Core R41

     -0.97%         11.72%         7.12%   

Small Cap Core R51

     -0.75%         11.99%         7.24%   

Small Cap Core Y1

     -0.71%         12.01%         7.25%   

Russell 2000 Index

     0.34%         12.06%         7.47%   

Russell 2500 Index

     1.50%         13.07%         8.33%   

 

1  Without sales charge
2  With sales charge
3  Class B shares convert to Class A shares after 8 years. The return shown reflects the conversion to Class A shares, which had different operating expenses for the period after conversion.
4  Inception: 03/31/2015.

PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND DOES NOT GUARANTEE FUTURE RESULTS. The investment return and principal value of the investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain performance data current to the most recent month-end, please visit our website www.hartfordfunds.com.

The initial investment in Class A shares reflects the maximum sales charge of 5.50% and returns for Class B shares reflect a contingent deferred sales charge of up to 5.00% and declining to zero, depending on the period of time the shares are held. Returns for Class C shares reflect a contingent deferred sales charge of up to 1.00% on shares redeemed within twelve months of purchase.

Total returns presented above were calculated using the Fund’s net asset value available to shareholders for sale or redemption of Fund shares on October 31, 2015, which may

exclude investment transactions as of this date. All share class returns assume the reinvestment of all distributions at net asset value and the deduction of all fund expenses.

Effective 9/30/09, Class B shares of the Fund were closed to new investments.

Class R3, R4 and R5 shares commenced operations on 9/30/11. Performance prior to that date is that of the Fund’s Class Y shares, which had different operating expenses. Class I shares commenced operations on 03/31/15. Performance prior to that date is that of the Fund’s Class Y shares, which had different operating expenses.

Performance information includes the Fund’s performance when it invested, prior to 2/1/10, at least 80% of its assets in common stocks of mid-capitalization companies and prior to 7/10/15, at least 80% of its assets in common stocks of small-capitalization and mid-capitalization companies.

Performance information includes performance under the Fund’s previous sub-adviser, Hartford Investment Management Company. As of June 4, 2012, Hartford Investment Management Company no longer served as the sub-adviser to the Fund.

Russell 2000 Index is a broad-based unmanaged index comprised of 2,000 of the smallest U.S.-domiciled company common stocks (on the basis of capitalization) that are traded in the United States on the New York Stock Exchange, American Stock Exchange and Nasdaq.

Russell 2500 Index measures the performance of the small to mid-cap segment of the U.S. equity universe, commonly referred to as “smid” cap. The Russell 2500 Index is a subset of the Russell 3000 Index and includes approximately 2,500 of the smallest securities, based on a combination of their market capitalization and current index membership.

You cannot invest directly in an index.

The chart and table do not reflect the deductions of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Performance information may reflect historical or current expense waivers/reimbursements from the investment adviser, without which performance would have been lower. For information on current expense waivers/reimbursements, please see the prospectus.

The Fund has changed its benchmark from the Russell 2500 Index to the Russell 2000 Index. Hartford Funds Management Company, LLC believes that the Russell 2000 Index is a more appropriate index against which to measure performance in light of changes to the Fund’s investment strategy to a focus on stocks of small capitalization companies.

 

* Effective July 10, 2015, The Hartford Small/Mid Cap Equity Fund changed its name to the Hartford Small Cap Core Fund.
 

 

 

  26  

 


Hartford Small Cap Core Fund*

Manager Discussion

October 31, 2015 (Unaudited)

 

 

 

Operating Expenses*

 

      Net      Gross  

Small Cap Core Class A

     1.30%         1.41%   

Small Cap Core Class B

     2.05%         2.32%   

Small Cap Core Class C

     2.05%         2.16%   

Small Cap Core Class I

     1.05%         1.10%   

Small Cap Core Class R3

     1.50%         1.70%   

Small Cap Core Class R4

     1.20%         1.37%   

Small Cap Core Class R5

     0.90%         1.05%   

Small Cap Core Class Y

     0.85%         0.96%   

 

* Actual expenses may be higher or lower. Please see accompanying Financial Highlights for expense ratios for the year ended October 31, 2015.

 

Expense ratios are as shown in the most recent prospectus. Net expenses reflect contractual expense reimbursements in instances when these reductions reduce the Fund’s gross expenses. Contractual reimbursements remain in effect until February 29, 2016 and automatically renew for one-year terms unless terminated.

All investments are subject to risk including the possible loss of principal. For a discussion of the Fund’s risks, please see the Main Risks section of this report. For more detailed information on the risks associated with an investment in the Fund, please see the prospectus.

 

 

 

Portfolio Manager

David J. Elliott, CFA

Managing Director, Co-Director of Quantitative Investments and Portfolio Manager

Wellington Management Company LLP

 

 

 

How did the Fund perform during the period?

The Class A shares of the Hartford Small Cap Core Fund returned -1.17%, before sales charge, for the twelve-month period ended October 31, 2015, underperforming its benchmark**, which returned -0.16%. For the same period, the Fund also underperformed the average return of the Lipper Small-Cap Core Funds peer group -0.21%, a group of funds with investment strategies similar to those of the Fund.

Why did the Fund perform this way?

U.S. equities, as measured by the S&P 500 Index, rose during the twelve-month period. U.S. stocks finished 2014 with strong gains, retreated briefly early in 2015, but then reached new all-time highs on March 2, April 24, and May 21. The market pulled back in early March as soft manufacturing data, potentially negative currency- and oil-related earnings data, and valuation concerns weighed on investors’ minds. However, risk appetites increased after the March 18 Federal Open Market Committee statement underlined the U.S. Federal Reserve’s (Fed) hesitation to raise rates as U.S. domestic inflation remained subdued and other major central banks maintained an easing bias. In April, the tech-heavy Nasdaq Composite topped the 5,000 mark for the first time in 15 years and broke its closing record from March 2000. Continued strong merger and acquisition (M&A) activity, a rebound in hiring, and solid housing data helped to fuel risk appetites. May marked the second-best month ever for M&A transactions involving U.S. companies with $234 billion in announced mergers. Stocks ended June on a sour note after negotiations between Greece and its creditors regarding Greece’s loan repayments broke down.

 

In the second half of the period, the U.S. economy remained on solid footing, with a sharp rebound in Gross Domestic Product (GDP), a seven-year low in unemployment, and a healthy housing market. While the growth slowdown in China and its implications for global commerce fueled investor anxiety during the second half of the period, uncertainty about the Fed’s rate hike timeline also weighed on sentiment. During August and September, the market remained extremely volatile and experienced its first correction (a decline of at least 10%) since October 2011. As many market participants expected, the Fed left rates unchanged at its highly anticipated September meeting. The Fed’s statement appeared to spook some investors as it acknowledged that “recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term.” U.S. equities ended the period with their best monthly return in four years during the month of October on the heels of strong corporate earnings and continued accommodative monetary policy across the globe.

Security selection drove benchmark-relative underperformance over the twelve-month period. Weak selection in Financials, Materials, and Consumer Discretionary was partially offset by stronger stock

selection in the Industrials, Energy, and Healthcare sectors. Overall sector allocation, a result of our bottom-up stock selection process, contributed to benchmark-relative returns during the period due to underweights to Healthcare and Materials and an overweight to Consumer Discretionary. This was only partially offset by an

 

 

* Effective July 10, 2015, The Hartford Small/Mid Cap Equity Fund changed its name and strategy. The Fund’s investment strategy was revised to reflect the Fund’s change to a focus on small-capitalization stocks rather than both small small-capitalization and mid-capitalization stocks.
** Effective July 10, 2015, the benchmark changed from Russell 2500 Index to Russell 2000 Index. Benchmark returns and attribution results are against the spliced benchmark (Russell 2500 from inception to July 10, 2015 and Russell 2000 from July 10, 2015 to present).

 

 

  27  

 


Hartford Small Cap Core Fund

Manager Discussion – (continued)

October 31, 2015 (Unaudited)

 

 

 

overweight to the Energy sector and underweights to the Consumer Staples and Utilities sectors.

The largest detractors from benchmark-relative performance over the period were PDL BioPharma (Healthcare), Orexigen Therapeutic (Healthcare), and Resolute Forest Products (Materials). Shares of PDL BioPharma, a U.S.-based health care company that provides non-dilutive growth capital and financing solutions to public and private healthcare companies, underperformed over the period driven by concerns about future profitability within the industry due to potential government regulations. Shares of Orexigen Therapeutics, a U.S.-based biopharmaceutical company that focuses on the development of pharmaceutical product candidates for the treatment of obesity, underperformed over the period due to a widespread correction within biopharmaceuticals that did not make a distinction between the unique circumstances of each firm. Shares of Resolute Forest Products, a U.S.-based forest products company that offers newsprint, specialty papers, market pulp and wood products, fell over the period after announcing first quarter 2015 results that were well below expectations. Infoblox (Information Technology) detracted from absolute returns over the period due to concerns about the sustainability of their growth rate and the threat of new entrants into the niche.

The largest contributors to benchmark-relative performance during the period were Anacor Pharmaceuticals (Healthcare), Windstream Holdings (Telecommunication Services), and Alaska Air Group (Industrials). Anacor Pharmaceuticals is a U.S.-based biopharmaceutical company focused on discovering, developing and commercializing small-molecule therapeutics derived from its boron chemistry platform. Shares of Anacor benefited from positive sales momentum built by the company’s marketing partner, Novartis, for Anacor’s toenail-fungus-fighting drug Kerydin. Shares of Windstream

Holdings, a telecommunication services firm that provides communications and technology solutions, including managed services and cloud computing to businesses, fell over the period due to poor earnings results; not owning this benchmark constituent contributed to benchmark-relative performance over the period. Shares of Alaska Air Group, the holding company of Alaska Airlines, Inc. which operates a network of regional air carriers throughout the U.S., Canada and Mexico, outperformed over the period due to the expected positive impact from route expansion across the U.S. and Mexico. Skyworks Solutions (Information Technology) was a top contributor to absolute returns over the period.

Derivatives were not used in a significant manner in this Fund during the period and did not have a material impact on performance during the period.

What is the outlook?

The Fund seeks to add value by utilizing Wellington Management’s proprietary quantitative research and investment tools in a highly disciplined framework. The Fund focuses on stock selection as the

key driver of returns and uses quantitative portfolio optimization techniques to minimize unintended and uncompensated risks. Based on individual stock decisions seek to, the Fund ended the period most overweight the Information Technology, Telecommunication Services, and Consumer Discretionary sectors and most underweight the Healthcare, Industrials, and Financials sectors relative to the Russell 2000 Index.

Diversification by Sector

as of October 31, 2015

 

Sector    Percentage of
Net Assets
 

Equity Securities

  

Consumer Discretionary

     13.9

Consumer Staples

     3.3   

Energy

     3.0   

Financials

     25.2   

Health Care

     13.2   

Industrials

     12.1   

Information Technology

     18.8   

Materials

     3.6   

Telecommunication Services

     1.5   

Utilities

     3.7   
  

 

 

 

Total

     98.3
  

 

 

 

Short-Term Investments

     1.6   

Other Assets & Liabilities

     0.1   
  

 

 

 

Total

     100.0
  

 

 

 

A sector may be comprised of several industries. For Fund compliance purposes, the Fund may not use the same classification system and these sector classifications are used for financial reporting purposes.

 

 

 

  28  

 


The Hartford Small Company Fund inception 07/22/1996

 

(sub-advised by Wellington Management Company LLP)   Investment objective – The Fund seeks growth of capital.

LOGO

The chart above represents the hypothetical growth of a $10,000 investment in Class A, which includes a sales charge. Growth results in classes other than Class A will vary from what is seen above due to differences in the expenses charged to those share classes.

 

Average Annual Total Returns (as of 10/31/15)

 

      1 Year      5 Years      10 Years  

Small Company A1

     -6.22%         11.24%         7.13%   

Small Company A2

     -11.38%         9.99%         6.53%   

Small Company B1

     -6.98%         10.38%         6.54% 3 

Small Company B2

     -10.68%         10.12%         6.54% 3 

Small Company C1

     -6.87%         10.45%         6.36%   

Small Company C2

     -7.61%         10.45%         6.36%   

Small Company I1

     -6.03%         11.53%         7.39%   

Small Company R31

     -6.46%         11.04%         6.99%   

Small Company R41

     -6.15%         11.38%         7.30%   

Small Company R51

     -5.88%         11.71%         7.57%   

Small Company R61,4

     -5.80%         11.81%         7.67%   

Small Company Y1

     -5.80%         11.81%         7.67%   

Russell 2000 Growth Index

     3.52%         13.56%         8.67%   

 

1  Without sales charge
2  With sales charge
3  Class B shares convert to Class A shares after 8 years. The return shown reflects the conversion to Class A shares, which had different operating expenses for the period after conversion.
4  Inception: 11/07/2014.

PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND DOES NOT GUARANTEE FUTURE RESULTS. The investment return and principal value of the investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain performance data current to the most recent month-end, please visit our website www.hartfordfunds.com.

The initial investment in Class A shares reflects the maximum sales charge of 5.50% and returns for Class B shares reflect a contingent deferred sales charge of up to 5.00% and declining to zero, depending on the period of time the shares are held.

Returns for Class C shares reflect a contingent deferred sales charge of up to 1.00% on shares redeemed within twelve months of purchase.

Total returns presented above were calculated using the Fund’s net asset value available to shareholders for sale or redemption of Fund shares on October 31, 2015, which may exclude investment transactions as of this date. All share class returns assume the reinvestment of all distributions at net asset value and the deduction of all fund expenses.

Effective 9/30/09, Class B shares of the Fund were closed to new investments.

Performance information includes performance under the Fund’s previous sub-adviser, Hartford Investment Management Company. As of July 21, 2010, Hartford Investment Management Company no longer served as the sub-adviser to the Fund.

Class I shares commenced operations on 8/31/06. Performance prior to that date is that of the Fund’s Class A shares (excluding sales charges), which had different operating expenses. Class R3, R4 and R5 shares commenced operations on 12/22/06. Performance prior to that date is that of the Fund’s Class Y shares which had different operating expenses. Class R6 shares commenced operations on 11/07/14. Performance prior to that date is that of the Fund’s Class Y shares.

Russell 2000 Growth Index is an unmanaged index of those Russell 2000 Index growth companies with higher price-to-book ratios and higher forecasted growth values. The Russell 2000 Index is a broad-based unmanaged index comprised of 2,000 of the smallest U.S.-domiciled company common stocks (on the basis of capitalization) that are traded in the United States on the New York Stock Exchange, NYSE MKT LLC and Nasdaq.

You cannot invest directly in an index.

The chart and table do not reflect the deductions of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Performance information may reflect historical or current expense waivers/reimbursements from the investment adviser, without which performance would have been lower. For information on current expense waivers/reimbursements, please see the prospectus.

 

 

 

  29  

 


The Hartford Small Company Fund

Manager Discussion

October 31, 2015 (Unaudited)

 

 

 

Operating Expenses*

 

      Net      Gross  

Small Company Class A

     1.34%         1.34%   

Small Company Class B

     2.15%         2.29%   

Small Company Class C

     2.05%         2.05%   

Small Company Class I

     1.10%         1.10%   

Small Company Class R3

     1.55%         1.55%   

Small Company Class R4

     1.25%         1.25%   

Small Company Class R5

     0.95%         0.97%   

Small Company Class R6

     0.85%         0.85%   

Small Company Class Y

     0.85%         0.85%   

 

* Actual expenses may be higher or lower. Please see accompanying Financial Highlights for expense ratios for the year ended October 31, 2015.

Expense ratios are as shown in the most recent prospectus. Net expenses reflect contractual expense reimbursements in instances when these reductions reduce the Fund’s gross expenses. Contractual reimbursements remain in effect until February 29, 2016 and automatically renew for one-year terms unless terminated.

All investments are subject to risk including the possible loss of principal. For a discussion of the Fund’s risks, please see the Main Risks section of this report. For more detailed information on the risks associated with an investment in the Fund, please see the prospectus.

 

 

 

Portfolio Managers

Steven C. Angeli, CFA

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

Stephen Mortimer

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

Mario E. Abularach, CFA

Senior Managing Director and Equity Research Analyst

Wellington Management Company LLP

Mammen Chally, CFA

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

Jamie A. Rome, CFA

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

 

 

 

How did the Fund perform during the period?

The Class A shares of The Hartford Small Company Fund returned -6.22%, before sales charge, for the twelve-month period ended October 31, 2015, underperforming the Fund’s benchmark, the Russell 2000 Growth Index which returned 3.52% for the same period. The Fund also underperformed the 1.87% average return of the Lipper Small Cap Growth Funds peer group, a group of funds with investment strategies similar to those of the Fund.

Why did the Fund perform this way?

U.S. equities, as measured by the S&P 500 Index, rose during the twelve-month period. U.S. stocks finished 2014 with strong gains, retreated briefly early in 2015, but then reached new all-time highs on March 2, April 24, and May 21. The market pulled back in early March as soft manufacturing data, potentially negative currency- and oil-related earnings, and valuation concerns weighed on investors’ minds. However, risk appetites increased after the March 18 Federal

Open Market Committee statement underlined the U.S. Federal Reserve’s (Fed) hesitation to raise rates as U.S. domestic inflation remained subdued and other major central banks maintained an easing bias. In April, the tech-heavy Nasdaq Composite topped the 5,000 mark for the first time since the dot-com bubble and broke its closing record from March 2000. Continued strong merger and acquisition (M&A) activity, a rebound in hiring, and solid housing data helped to fuel risk appetites. May marked the second-best month ever for M&A transactions involving U.S. companies with $234 billion in announcements. Stocks ended June on a sour note after negotiations between Greece and its creditors broke down.

In the second half of the period, the U.S. economy remained on solid footing, with a sharp rebound in Gross Domestic Product (GDP), a seven-year low in unemployment, and a healthy housing market. While the growth slowdown in China and its implications for global commerce fueled investor anxiety during the second half of the

 

 

 

  30  

 


The Hartford Small Company Fund

Manager Discussion – (continued)

October 31, 2015 (Unaudited)

 

 

 

period, uncertainty about the Fed’s rate hike timeline also weighed on sentiment. During August and September, the market remained extremely volatile and experienced its first correction since October 2011. As many market participants expected, the Fed left rates unchanged at its highly anticipated September meeting. The Fed’s statement appeared to spook some investors as it acknowledged that “recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term.” U.S. equities ended the period with their best monthly return in four years during the month of October on the heels of strong corporate earnings and continued accommodative monetary policy across the globe.

Large cap stocks (+5%) outperformed both small cap stocks (+0%) and mid cap stocks (+3%) during the period, as measured by the S&P 500, Russell 2000, and S&P MidCap 400 indices respectively. Small cap growth (+4%) stocks outperformed small cap value (-3%) stocks during the period, as measured by the Russell 2000 Growth and Russell 2000 Value indices, respectively. Seven out of ten sectors in the Russell 2000 Growth Index had positive returns during the period. The Utilities (+14%), Information Technology (+13%), and Healthcare (+9%) sectors performed best, while Energy (-40%), Materials (-10%), and Industrials (-6%) lagged the broader index.

During the period, security selection was the primary driver of the Fund’s underperformance relative to the Russell 2000 Growth Index. Selection was weakest in the Information Technology, Consumer Discretionary, and Healthcare sectors which more than offset positive relative results from stronger selection in the Energy sector. Sector allocation, which is the result of bottom-up stock selection, also detracted from returns relative to the Russell 2000 Growth Index during the period; an overweight to Industrials and an underweight to Healthcare detracted from relative results. An underweight to Energy and an overweight to Financials contributed to performance relative to the Russell 2000 Growth Index during the period.

Top detractors from relative and absolute performance during the period included Platform Specialty (Materials), Mobileye (Information Technology), and Zulily (Consumer Discretionary). Shares of Platform Specialty, a producer of complex specialty chemicals, declined due to continued difficulties from foreign exchange rates. The company’s sales have been hurt as the U.S. dollar has strengthened abroad. Shares of Mobileye, maker of an Advanced Driver Assistance System that makes cars safer and easier to drive, came under pressure in the fourth quarter of 2014 due to concerns about competitive pressure. Shares of Zulily, an online merchandise retailer, fell after the company reported quarterly results above consensus expectations, but provided disappointing guidance, which implied a deceleration in user growth.

Top contributors to performance relative to the Russell 2000 Growth Index during the period included Anacor Pharmaceuticals (Healthcare), Dexcom (Healthcare), and WNS (Information

Technology). Shares of Anacor Pharmaceuticals, a biopharmaceutical company, surged after the company announced favorable Phase 3 trial results for a topical ointment to treat eczema. Medical device company DexCom outperformed over the period on positive news flow. Management announced strong quarterly revenue growth and raised sales guidance for the full fiscal year. Shares of WNS, a provider of business process management services, rose after the company posted strong quarterly earnings due to better-than-expected operating margins and continued efficiency gains. Top absolute contributors also included Headwaters (Materials).

Derivatives were not used in a significant manner in this Fund during the period and did not have a material impact on performance during the period.

What is the outlook?

From a fundamental standpoint, the recent market environment has been one of the most challenging we have encountered. Within the context of a narrow and volatile market, the market seems to be disassociating operating fundamentals from price performance, and this has in turn resulted in challenging relative performance for our approach. We remain confident in our investment process.

We view a diversified portfolio as a means to hedge against risk associated with unpredictable events and economic outcomes. As a residual of our bottom-up, stock-by-stock investment decisions, the Fund ended the period overweight in the Financials and Information Technology sectors relative to the Russell 2000 Growth Index. The Fund ended the period most underweight Healthcare and Consumer Discretionary.

Diversification by Sector

as of October 31, 2015

 

Sector    Percentage of
Net Assets
 

Equity Securities

  

Consumer Discretionary

     14.0

Consumer Staples

     1.6   

Energy

     2.0   

Financials

     15.3   

Health Care

     21.0   

Industrials

     11.6   

Information Technology

     25.3   

Materials

     5.1   

Utilities

     0.1   
  

 

 

 

Total

     96.0
  

 

 

 

Short-Term Investments

     8.7   

Other Assets & Liabilities

     (4.7
  

 

 

 

Total

     100.0
  

 

 

 

A sector may be comprised of several industries. For Fund compliance purposes, the Fund may not use the same classification system and these sector classifications are used for financial reporting purposes.

 

 

 

  31  

 


The Hartford SmallCap Growth Fund* inception 01/04/1988

(sub-advised by Wellington Management Company LLP)   Investment objective – The Fund seeks long-term capital appreciation.

LOGO

The chart above represents the hypothetical growth of a $10,000 investment in Class A, which includes a sales charge. Growth results in classes other than Class A will vary from what is seen above due to differences in the expenses charged to those share classes.

 

Average Annual Total Returns (as of 10/31/15)

 

      1 Year      5 Years      10 Years  

SmallCap Growth A1

     4.37%         14.62%         8.01%   

SmallCap Growth A2

     -1.37%         13.33%         7.40%   

SmallCap Growth B1

     3.54%         13.74%         7.43% 3 

SmallCap Growth B2

     -1.37%         13.50%         7.43% 3 

SmallCap Growth C1

     3.62%         13.80%         7.19%   

SmallCap Growth C2

     2.64%         13.80%         7.19%   

SmallCap Growth I1

     4.70%         14.98%         8.23%   

SmallCap Growth R31

     4.10%         14.37%         7.81%   

SmallCap Growth R41

     4.44%         14.72%         8.08%   

SmallCap Growth R51

     4.74%         15.06%         8.36%   

SmallCap Growth R61,4

     4.76%         15.15%         8.43%   

SmallCap Growth Y1

     4.84%         15.17%         8.44%   

Russell 2000 Growth Index

     3.52%         13.56%         8.67%   

 

1  Without sales charge
2  With sales charge
3  Class B shares convert to Class A shares after 8 years. The return shown reflects the conversion to Class A shares, which had different operating expenses for the period after conversion.
4  Inception: 11/07/2014.

PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND DOES NOT GUARANTEE FUTURE RESULTS. The investment return and principal value of the investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain performance data current to the most recent month-end, please visit our website www.hartfordfunds.com.

The initial investment in Class A shares reflects the maximum sales charge of 5.50% and returns for Class B shares reflect a contingent deferred sales charge of up to 5.00% and declining to zero, depending on the period of time the shares are held. Returns for Class C shares reflect a contingent deferred sales charge of up to 1.00% on shares redeemed within twelve months of purchase.

Total returns presented above were calculated using the Fund’s net asset value available to shareholders for sale or redemption of Fund shares on October 31, 2015, which may exclude investment transactions as of this date. All share class returns assume the reinvestment of all distributions at net asset value and the deduction of all fund expenses.

Effective 9/30/09, Class B shares of the Fund were closed to new investments.

Performance information includes performance under the Fund’s previous sub-adviser, Hartford Investment Management Company. As of July 21, 2010, Hartford Investment Management Company no longer served as the sub-adviser to the Fund.

Class I shares commenced operations on 8/31/06. Performance prior to that date is that of the Fund’s Class A shares (excluding sales charges), which had different operating expenses. Class R3, R4 and R5 shares commenced operations on 12/22/06. Performance prior to that date is that of the Fund’s Class Y shares, which had different operating expenses. Class R6 shares commenced operations on 11/07/14. Performance prior to that date is that of the Fund’s Class Y shares.

Russell 2000 Growth Index is an unmanaged index of those Russell 2000 Index growth companies with higher price-to-book ratios and higher forecasted growth values. The Russell 2000 Index is a broad-based unmanaged index comprised of 2,000 of the smallest U.S.-domiciled company common stocks (on the basis of capitalization) that are traded in the United States on the New York Stock Exchange, NYSE MKT LLC and Nasdaq.

You cannot invest directly in an index.

The chart and table do not reflect the deductions of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Performance information may reflect historical or current expense waivers/reimbursements from the investment adviser, without which performance would have been lower. For information on current expense waivers/reimbursements, please see the prospectus.

 

* Effective March 6, 2015, the Fund was closed to new investors until further notice. For more information, please see the Fund’s prospectus.
 

 

 

  32  

 


The Hartford SmallCap Growth Fund

Manager Discussion

October 31, 2015 (Unaudited)

 

 

 

Operating Expenses*

 

      Net      Gross  

SmallCap Growth Class A

     1.28%         1.28%   

SmallCap Growth Class B

     2.11%         2.26%   

SmallCap Growth Class C

     1.97%         1.97%   

SmallCap Growth Class I

     0.97%         0.97%   

SmallCap Growth Class R3

     1.53%         1.53%   

SmallCap Growth Class R4

     1.22%         1.22%   

SmallCap Growth Class R5

     0.91%         0.91%   

SmallCap Growth Class R6

     0.81%         0.81%   

SmallCap Growth Class Y

     0.81%         0.81%   

 

* Actual expenses may be higher or lower. Please see accompanying Financial Highlights for expense ratios for the year ended October 31, 2015.

Expense ratios are as shown in the most recent prospectus. Net expenses reflect contractual expense reimbursements in instances when these reductions reduce the Fund’s gross expenses. Contractual reimbursements remain in effect until February 29, 2016 and automatically renew for one-year terms unless terminated.

All investments are subject to risk including the possible loss of principal. For a discussion of the Fund’s risks, please see the Main Risks section of this report. For more detailed information on the risks associated with an investment in the Fund, please see the prospectus.

 

 

 

Portfolio Managers

Mammen Chally, CFA

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

David J. Elliott, CFA

Managing Director, Co-Director, Quantitative Investments and Portfolio Manager

Wellington Management Company LLP

 

 

 

How did the Fund perform during the period?

The Class A shares of The Hartford SmallCap Growth Fund returned 4.37%, before sales charge, for the twelve-month period ended October 31, 2015, outperforming the Fund’s benchmark, the Russell 2000 Growth Index, which returned 3.52%. For the same period, the Fund outperformed the 1.87% average return of the Lipper Small-Cap Growth Funds peer group, a group of funds with investment strategies similar to those of the Fund.

Why did the Fund perform this way?

U.S. equities, as measured by the S&P 500 Index, rose during the twelve-month period. U.S. stocks finished 2014 with strong gains, retreated briefly early in 2015, but then reached new all-time highs on March 2, April 24, and May 21. The market pulled back in early March as soft manufacturing data, potentially negative currency- and oil-related earnings data, and valuation concerns weighed on investors’ minds. However, risk appetites increased after the March 18 Federal Open Market Committee statement underlined the U.S. Federal Reserve’s (Fed) hesitation to raise rates as U.S. domestic inflation remained subdued and other major central banks maintained an easing bias. In April, the tech-heavy Nasdaq Composite topped the 5,000 mark for the first time in 15 years and broke its closing record from March 2000. Continued strong merger and acquisition (M&A) activity, a rebound in hiring, and solid housing data helped to fuel risk appetites. May marked the second-best month ever for M&A transactions involving U.S. companies with $234 billion in announced mergers. Stocks ended June on a sour note after negotiations between Greece and its creditors regarding Greece’s loan repayments broke down.

In the second half of the period, the U.S. economy remained on solid footing, with a sharp rebound in Gross Domestic Product (GDP), a seven-year low in unemployment, and a healthy housing market. While the growth slowdown in China and its implications for global commerce fueled investor anxiety during the second half of the period, uncertainty about the Fed’s rate hike timeline also weighed on sentiment. During August and September, the market remained extremely volatile and experienced its first correction (a decline of at least 10%) since October 2011. As many market participants expected, the Fed left rates unchanged at its highly anticipated September meeting. The Fed’s statement appeared to spook some investors as it acknowledged that “recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term.” U.S. equities ended the period with their best monthly return in four years during the month of October on the heels of strong corporate earnings and continued accommodative monetary policy across the globe.

Large cap stocks (+5%) outperformed both small cap stocks (+0%) and mid cap stocks (+3%) during the period, as measured by the S&P 500, Russell 2000, and S&P MidCap 400 indices, respectively. Small cap growth (+4%) stocks outperformed small cap value (-1%) stocks during the period, as measured by the Russell 2000 Growth and Russell 2500 Value indices, respectively. Seven out of ten sectors in the Russell 2000 Growth Index had positive returns during the period. The Utilities (+14%), Information Technology (+13%), and Healthcare (+9%) sectors performed best, while Energy (-40%), Materials (-10%), and Industrials (-6%) lagged the broader index.

 

 

 

  33  

 


The Hartford SmallCap Growth Fund

Manager Discussion – (continued)

October 31, 2015 (Unaudited)

 

 

 

Security selection was positive in all sectors and was the primary driver of outperformance relative to the Russell 2000 Growth Index during the period. Selection was strongest within Information Technology, Materials, and Financials. Sector allocation, driven by our bottom-up stock selection, detracted from relative returns during the period. Underweights to the Healthcare and Information Technology sectors and an overweight to Materials detracted from performance relative to the Russell 2000 Growth Index during the period. An underweight to the Energy sector and an overweight to Consumer Staples contributed to benchmark-relative results.

The top contributors to performance relative to the Russell 2000 Growth Index were Anacor Pharmaceuticals (Healthcare), DexCom (Healthcare), and Ellie Mae (Information Technology). Shares of Anacor Pharmaceuticals, a biopharmaceutical company, climbed after the company announced strong quarterly results well above Wall Street forecasts. Medical device company DexCom outperformed over the period on positive news flow, including management changes, strong revenue results, and FDA approval of a glucose monitoring system. Shares of Ellie Mae, a software vendor that sells software into the mortgage origination market, rose over the period, as the company benefited from stabilizing mortgage origination volumes, while gaining tremendous share and showing some of the best organic growth in the small cap software space. Top absolute contributors to performance for the period also included Manhattan Associates (Information Technology).

The top detractors from performance relative to the Russell 2000 Growth Index included Vince Holding (Consumer Discretionary), Synageva (Healthcare), and Sonus Networks (Information Technology). Vince Holding is an apparel vendor primarily focused on high-end department stores. The company’s shares fell after management positioned 2015 performance below Street expectations due to a slowdown in their wholesale business. Synageva is a biopharmaceutical company focused on developing therapies for patients with rare “orphan” diseases. Not holding this benchmark constituent detracted from relative performance during the period as shares of Synageva surged following a takeover announcement by Alexion Pharmaceuticals. Shares of Sonus Networks, a provider of networked solutions for telecommunications, wireless and cable service providers, fell after the company negatively preannounced first quarter 2015 results and updated calendar year 2015 results below its prior guide. The company pointed to orders it no longer expected to receive at the end of the quarter as the reason for the miss and lowered guide. Top absolute detractors from performance for the period also included Puma Biotechnology (Healthcare).

Derivatives were not used in a significant manner in this Fund during the period and did not have a material impact on performance during the period.

What is the outlook?

We believe the U.S. economy is still in a period of moderate economic growth, led by a steady expansion of consumption,

housing, and technology spending. Because the Fed did not hike rates in September, there appears to be some concerns about weak global growth impacting the U.S. While uncertainty outside of the U.S. has increased, our base case is that the U.S. economy will continue on its moderate growth path. We think the U.S. employment situation is fairly healthy, which should continue to support housing and consumption. In terms of the Fed, our base case is that the central bank raises rates at its December meeting, followed by moderate additional hikes in 2016.

Globally, among large emerging economies, growth in China appears weak and Brazil appears to be also struggling. Several emerging market economies are facing conditions that may make future growth difficult as they contend with lower revenues from the sharp drop in the commodities complex and the increased burden of dollar denominated debt they hold due to the strength of the U.S. dollar. Many investors now fear that the U.S. economy is vulnerable due to this weak global economic backdrop, and the Fed’s recent commentary appeared to fuel this anxiety. Things have gotten a little more uncertain in terms of the global economy and the market seems a bit more unsettled. However, we remain cautiously optimistic that the U.S. economy can withstand any potential contagion.

Overall, we continue to find what we consider to be attractively valued stocks with the characteristics we seek. While the global economic landscape has weakened, we are cautiously optimistic about the outlook for the U.S. economy and for equity markets, and we continue to monitor policy decisions and economic trends which may impact our holdings. At the end of the period, our largest overweights were to Consumer Staples and Financials while our largest underweights were to the Consumer Discretionary and Healthcare sectors relative to the Russell 2000 Growth Index.

Diversification by Sector

as of October 31, 2015

 

Sector    Percentage of
Net Assets
 

Equity Securities

  

Consumer Discretionary

     16.1

Consumer Staples

     4.5   

Energy

     1.6   

Financials

     10.2   

Health Care

     24.6   

Industrials

     12.5   

Information Technology

     24.8   

Materials

     4.1   

Telecommunication Services

     0.5   
  

 

 

 

Total

     98.9
  

 

 

 

Short-Term Investments

     1.2   

Other Assets & Liabilities

     (0.1
  

 

 

 

Total

     100.0
  

 

 

 

A sector may be comprised of several industries. For Fund compliance purposes, the Fund may not use the same classification system and these sector classifications are used for financial reporting purposes.

 

 

 

  34  

 


The Hartford Value Opportunities Fund inception 01/02/1996

 

(sub-advised by Wellington Management Company LLP)   Investment objective – The Fund seeks capital appreciation.

LOGO

The chart above represents the hypothetical growth of a $10,000 investment in Class A, which includes a sales charge. Growth results in classes other than Class A will vary from what is seen above due to differences in the expenses charged to those share classes.

 

Average Annual Total Returns (as of 10/31/15)

 

      1 Year      5 Years      10 Years  

Value Opportunities A1

     -1.20%         11.35%         6.25%   

Value Opportunities A2

     -6.64%         10.09%         5.65%   

Value Opportunities B1

     -1.94%         10.52%         5.68% 3 

Value Opportunities B2

     -6.45%         10.25%         5.68% 3 

Value Opportunities C1

     -1.90%         10.54%         5.46%   

Value Opportunities C2

     -2.80%         10.54%         5.46%   

Value Opportunities I1

     -0.78%         11.72%         6.54%   

Value Opportunities R31

     -1.45%         11.09%         6.03%   

Value Opportunities R41

     -1.11%         11.45%         6.33%   

Value Opportunities R51

     -0.87%         11.76%         6.60%   

Value Opportunities Y1

     -0.77%         11.79%         6.68%   

Russell 3000 Value Index

     0.24%         13.04%         6.71%   

Russell 1000 Value Index

     0.53%         13.26%         6.75%   

 

1  Without sales charge
2  With sales charge
3  Class B shares convert to Class A shares after 8 years. The return shown reflects the conversion to Class A shares, which had different operating expenses for the period after conversion.

PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND DOES NOT GUARANTEE FUTURE RESULTS. The investment return and principal value of the investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain performance data current to the most recent month-end, please visit our website www.hartfordfunds.com.

The initial investment in Class A shares reflects the maximum sales charge of 5.50% and returns for Class B shares reflect a contingent deferred sales charge of up to 5.00% and declining to zero, depending on the period of time the shares are held. Returns for Class C shares reflect a contingent deferred sales charge of up to 1.00% on shares redeemed within twelve months of purchase.

Total returns presented above were calculated using the Fund’s net asset value available to shareholders for sale or redemption of Fund shares on October 31, 2015, which may exclude investment transactions as of this date. All share class returns assume the reinvestment of all distributions at net asset value and the deduction of all fund expenses.

Effective 9/30/09, Class B shares of the Fund were closed to new investments.

Class I shares commenced operations on 8/31/06. Performance prior to that date is that of the Fund’s Class A shares (excluding sales charges), which had different operating expenses. Class R3, R4 and R5 shares commenced operations on 12/22/06. Performance prior to that date is that of the Fund’s Class Y shares, which had different operating expenses.

Russell 3000 Value Index is an unmanaged index that measures the performance of those Russell 3000 Index companies with lower price-to-book ratios and lower forecasted growth values. The Russell 3000 Index is an unmanaged index that measures the performance of the 3,000 largest U.S. companies based on total market capitalization.

Russell 1000 Value Index is an unmanaged index that measures the performance of those Russell 1000 Index companies with lower price-to-book ratios and lower forecasted growth values. The Russell 1000 Index is an unmanaged index that measures the performance of the 1,000 largest companies in the Russell 3000 Index, which measures the performance of the 3,000 largest U.S. companies, based on total market capitalizations.

You cannot invest directly in an index.

The chart and table do not reflect the deductions of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Performance information may reflect historical or current expense waivers/reimbursements from the investment adviser, without which performance would have been lower. For information on current expense waivers/reimbursements, please see the prospectus.

 

 

 

  35  

 


The Hartford Value Opportunities Fund

Manager Discussion

October 31, 2015 (Unaudited)

 

 

 

Operating Expenses*

 

      Net      Gross  

Value Opportunities Class A

     1.24%         1.24%   

Value Opportunities Class B

     2.10%         2.26%   

Value Opportunities Class C

     1.94%         1.94%   

Value Opportunities Class I

     0.86%         0.86%   

Value Opportunities Class R3

     1.52%         1.52%   

Value Opportunities Class R4

     1.20%         1.20%   

Value Opportunities Class R5

     0.87%         0.87%   

Value Opportunities Class Y

     0.82%         0.82%   

 

* Actual expenses may be higher or lower. Please see accompanying Financial Highlights for expense ratios for the year ended October 31, 2015.

Expense ratios are as shown in the most recent prospectus. Net expenses reflect contractual expense reimbursements in instances when these reductions reduce the Fund’s gross expenses. Contractual reimbursements remain in effect until February 29, 2016 and automatically renew for one-year terms unless terminated.

All investments are subject to risk including the possible loss of principal. For a discussion of the Fund’s risks, please see the Main Risks section of this report. For more detailed information on the risks associated with an investment in the Fund, please see the prospectus.

 

 

 

Portfolio Managers

David W. Palmer, CFA

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

James N. Mordy

Senior Managing Director and Equity Portfolio Manager

Wellington Management Company LLP

 

 

 

How did the Fund perform during the period?

The Class A shares of The Hartford Value Opportunities Fund returned -1.20%, before sales charge, for the twelve-month period ended October 31, 2015, underperforming the Fund’s benchmark, the Russell 3000 Value Index, which returned 0.24% for the same period. The Fund underperformed the Russell 1000 Value Index, the Fund’s other benchmark, which returned 0.53% for the same period. The Fund also underperformed the -0.67% average return of the Lipper Multi-Cap Value Fund peer group, a group of funds with investment strategies similar to those of the Fund.

Why did the Fund perform this way?

U.S. equities, as measured by the S&P 500 Index, rose during the twelve-month period. U.S. stocks finished 2014 with strong gains, retreated briefly early in 2015, but then reached new all-time highs on March 2, April 24, and May 21. The market pulled back in early March as soft manufacturing data, potentially negative currency- and oil-related earnings data, and valuation concerns weighed on investors’ minds. However, risk appetites increased after the March 18 Federal Open Market Committee statement underlined the U.S. Federal Reserve’s (Fed) hesitation to raise rates as U.S. domestic inflation remained subdued and other major central banks maintained an easing bias. In April, the tech-heavy Nasdaq Composite topped the 5,000 mark for the first time in 15 years and broke its closing record from March 2000. Continued strong merger and acquisition (M&A) activity, a rebound in hiring, and solid housing data helped to fuel risk appetites. May marked the second-best month ever for M&A transactions involving U.S. companies with $234 billion in announced mergers. Stocks ended June on a sour

note after negotiations between Greece and its creditors regarding Greece’s loan repayments broke down.

In the second half of the period, the U.S. economy remained on solid footing, with a sharp rebound in Gross Domestic Product (GDP), a seven-year low in unemployment, and a healthy housing market. While the growth slowdown in China and its implications for global commerce fueled investor anxiety during the second half of the period, uncertainty about the Fed’s rate hike timeline also weighed on sentiment. During August and September, the market remained extremely volatile and experienced its first correction (a decline of at least 10%) since October 2011. As many market participants expected, the Fed left rates unchanged at its highly anticipated September meeting. The Fed’s statement appeared to spook some investors as it acknowledged that “recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term.” U.S. equities ended the period with their best monthly return in four years during the month of October on the heels of strong corporate earnings and continued accommodative monetary policy across the globe.

Six of ten sectors within the Russell 3000 Value Index posted positive returns during the period. Healthcare (+10%) and Consumer Discretionary (+7%), were top performers while Energy (-21%) and Materials (-10%) lagged on a relative basis.

Sector allocation, a result of the bottom-up stock selection process, was the primary driver of the Fund’s underperformance relative to the Russell 3000 Value Index over the twelve-month period due to an

 

 

 

  36  

 


The Hartford Value Opportunities Fund

Manager Discussion – (continued)

October 31, 2015 (Unaudited)

 

 

 

overweight to Materials and an underweight to Healthcare. This was only partially offset by an underweight to Utilities. Security selection contributed to the Fund’s returns relative to the Russell 3000 Value Index over the period. Security selection was strongest within Information Technology, Financials and Consumer Staples, but this was partially offset by weaker selection in Energy, Materials, and Healthcare. A modest allocation to cash in a volatile market contributed to returns over the period.

The largest detractors from both absolute and relative performance included Southwestern Energy (Energy), Constellium (Energy), and Trican Well Services (Energy). Shares of Southwestern Energy, a U.S.-based energy company engaged in natural gas and oil exploration, development, and production, declined over the period as the impact of lower crude prices, compounded by the company’s announcement of disappointing second quarter earnings, weighed heavily on the company’s stock price. Constellium, a France-based aluminum smelting business, saw shares fall over the period due to weaker-than-expected earnings based on lower metals prices and operational issues. Shares of Trican Well Services, a supplier of pressure pumping services to the oil and gas industry, declined over the period along with the broader Energy sector despite beating consensus earnings and revenue estimates.

The largest contributors to performance relative to the Russell 3000 Value Index were Google (Information Technology) TESARO (Healthcare), and Exxon Mobil (Energy). Shares of Google, a multinational organization built around the company’s hugely popular search engine, rose over the period due to strong earnings results and higher growth expectations after the company announced a re-organization. Shares of TESARO, an oncology-focused biopharmaceutical company, outperformed over the period due to improving expectations regarding the timeline for ongoing clinical trials. Exxon Mobil, one of the world’s largest integrated oil and gas companies, saw shares underperform over the period as negative sentiment loomed over Energy stocks as oil prices were extremely volatile over the period; not holding this benchmark constituent contributed to under performance relative to the Russell 3000 Value Index. Top contributors on an absolute basis also included Cisco (Information Technology).

Derivatives were not used in a significant manner in this Fund during the period and did not have a material impact on performance during the period.

What is the outlook?

During the recent price volatility in the market, we have focused our research efforts on seeking to improve both aspects of the risk-reward dynamic in the portfolio and seeking to take advantage of price dislocations where it is possible and appears beneficial. By the end of the period, given our assessment of new pricing opportunities, our largest net additions to the portfolio were in the Energy and Industrials sectors. With the heightened level of investor discomfort creeping into stock prices over the past several months, we are

finding an expanding range of interesting opportunities upon which to focus our research lens.

In aggregate, we believe the overall risk exposures of the portfolio are consistent with their historical ranges since inception, and we continue to find what we consider to be attractively priced equities without assuming what we believe to be uncompensated risks. At the end of the period, the Fund was most overweight Materials, Consumer Discretionary, and Healthcare, and most underweight Consumer Staples, Industrials, and Energy relative to the Russell 3000 Value Index.

Diversification by Sector

as of October 31, 2015

 

Sector

   Percentage of
Net Assets
 

Equity Securities

  

Consumer Discretionary

     7.4

Consumer Staples

     1.6   

Energy

     11.1   

Financials

     32.3   

Health Care

     11.7   

Industrials

     8.5   

Information Technology

     11.6   

Materials

     7.3   

Telecommunication Services

     2.4   

Utilities

     5.9   
  

 

 

 

Total

     99.8
  

 

 

 

Short-Term Investments

     0.4   

Other Assets & Liabilities

     (0.2
  

 

 

 

Total

     100.0
  

 

 

 

A sector may be comprised of several industries. For Fund compliance purposes, the Fund may not use the same classification system and these sector classifications are used for financial reporting purposes.

 

 

 

  37  

 


Domestic Equity Funds

Expense Examples (Unaudited)

 

 

 

Your Fund’s Expenses

As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, if any, and contingent deferred sales charges (CDSC), if any, and (2) ongoing costs, including investment management fees, distribution and/or service (12b-1) fees, if any, and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in a Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period of May 1, 2015 through October 31, 2015.

Actual Expenses

The first set of columns of the table below provides information about actual account values and actual expenses. You may use the information in this row, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The second set of columns of the table below provides information about hypothetical account values and hypothetical expenses based on a Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in a Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) and CDSC. Therefore, the second set of columns of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would be higher. Expenses are equal to the Fund’s annualized expense ratios multiplied by average account value over the period, multiplied by 184/365 (to reflect the one-half year period).

The Hartford Capital Appreciation Fund

 

    Actual Return     Hypothetical (5% return before expenses)                    
     Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Annualized
expense
ratio
    Days in
the
current
1/2 year
    Days in
the full
year
 

Class A

  $ 1,000.00      $ 986.30      $ 5.51      $ 1,000.00      $ 1,019.66      $ 5.60        1.10     184        365   

Class B

  $ 1,000.00      $ 981.90      $ 9.89      $ 1,000.00      $ 1,015.22      $ 10.06        1.98     184        365   

Class C

  $ 1,000.00      $ 982.50      $ 9.14      $ 1,000.00      $ 1,015.98      $ 9.30        1.83     184        365   

Class I

  $ 1,000.00      $ 988.10      $ 3.76      $ 1,000.00      $ 1,021.43      $ 3.82        0.75     184        365   

Class R3

  $ 1,000.00      $ 984.90      $ 7.00      $ 1,000.00      $ 1,018.15      $ 7.12        1.40     184        365   

Class R4

  $ 1,000.00      $ 986.20      $ 5.51      $ 1,000.00      $ 1,019.66      $ 5.60        1.10     184        365   

Class R5

  $ 1,000.00      $ 987.60      $ 4.01      $ 1,000.00      $ 1,021.17      $ 4.08        0.80     184        365   

Class R6

  $ 1,000.00      $ 987.60      $ 3.76      $ 1,000.00      $ 1,021.43      $ 3.82        0.75     184        365   

Class Y

  $ 1,000.00      $ 988.30      $ 3.51      $ 1,000.00      $ 1,021.68      $ 3.57        0.70     184        365   

 

 

  38  

 


Domestic Equity Funds

Expense Examples (Unaudited) – (continued)

 

 

 

Hartford Core Equity Fund

 

    Actual Return     Hypothetical (5% return before expenses)                    
     Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through
October 31,
2015
    Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through
October 31,
2015
    Annualized
expense
ratio
    Days in
the
current
1/2 year
    Days in
the full
year
 

Class A

  $ 1,000.00      $ 1,032.60      $ 4.05      $ 1,000.00      $ 1,021.22      $ 4.02        0.79     184        365   

Class B

  $ 1,000.00      $ 1,028.60      $ 7.87      $ 1,000.00      $ 1,017.44      $ 7.83        1.54     184        365   

Class C

  $ 1,000.00      $ 1,028.60      $ 7.77      $ 1,000.00      $ 1,017.54      $ 7.73        1.52     184        365   

Class I

  $ 1,000.00      $ 1,033.90      $ 2.56      $ 1,000.00      $ 1,022.69      $ 2.55        0.50     184        365   

Class R3

  $ 1,000.00      $ 1,031.20      $ 5.58      $ 1,000.00      $ 1,019.71      $ 5.55        1.09     184        365   

Class R4

  $ 1,000.00      $ 1,032.60      $ 4.05      $ 1,000.00      $ 1,021.22      $ 4.02        0.79     184        365   

Class R5

  $ 1,000.00      $ 1,034.10      $ 2.51      $ 1,000.00      $ 1,022.74      $ 2.50        0.49     184        365   

Class R6

  $ 1,000.00      $ 1,034.40      $ 2.31      $ 1,000.00      $ 1,022.94      $ 2.29        0.45     184        365   

Class Y

  $ 1,000.00      $ 1,034.00      $ 2.31      $ 1,000.00      $ 1,022.94      $ 2.29        0.45     184        365   

The Hartford Dividend and Growth Fund

 

    Actual Return     Hypothetical (5% return before expenses)                    
     Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through
October 31,
2015
    Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through
October 31,
2015
    Annualized
expense
ratio
    Days in
the
current
1/2 year
    Days in
the full
year
 

Class A

  $ 1,000.00      $ 986.30      $ 5.11      $ 1,000.00      $ 1,020.06      $ 5.19        1.02     184        365   

Class B

  $ 1,000.00      $ 982.00      $ 9.49      $ 1,000.00      $ 1,015.63      $ 9.65        1.90     184        365   

Class C

  $ 1,000.00      $ 982.50      $ 8.89      $ 1,000.00      $ 1,016.23      $ 9.05        1.78     184        365   

Class I

  $ 1,000.00      $ 987.20      $ 4.06      $ 1,000.00      $ 1,021.12      $ 4.13        0.81     184        365   

Class R3

  $ 1,000.00      $ 984.60      $ 6.75      $ 1,000.00      $ 1,018.40      $ 6.87        1.35     184        365   

Class R4

  $ 1,000.00      $ 985.90      $ 5.26      $ 1,000.00      $ 1,019.91      $ 5.35        1.05     184        365   

Class R5

  $ 1,000.00      $ 987.50      $ 3.76      $ 1,000.00      $ 1,021.43      $ 3.82        0.75     184        365   

Class R6

  $ 1,000.00      $ 987.30      $ 3.51      $ 1,000.00      $ 1,021.68      $ 3.57        0.70     184        365   

Class Y

  $ 1,000.00      $ 988.00      $ 3.26      $ 1,000.00      $ 1,021.93      $ 3.31        0.65     184        365   

 

 

  39  

 


Domestic Equity Funds

Expense Examples (Unaudited) – (continued)

 

 

 

The Hartford Equity Income Fund

 

    Actual Return     Hypothetical (5% return before expenses)                    
     Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Annualized
expense
ratio
    Days in
the
current
1/2 year
    Days in
the full
year
 

Class A

  $ 1,000.00      $ 994.50      $ 5.18      $ 1,000.00      $ 1,020.01      $ 5.24        1.03     184        365   

Class B

  $ 1,000.00      $ 994.00      $ 5.88      $ 1,000.00      $ 1,019.31      $ 5.96        1.17     184        365   

Class C

  $ 1,000.00      $ 990.20      $ 8.93      $ 1,000.00      $ 1,016.23      $ 9.05        1.78     184        365   

Class I

  $ 1,000.00      $ 995.20      $ 3.77      $ 1,000.00      $ 1,021.43      $ 3.82        0.75     184        365   

Class R3

  $ 1,000.00      $ 992.70      $ 6.88      $ 1,000.00      $ 1,018.30      $ 6.97        1.37     184        365   

Class R4

  $ 1,000.00      $ 993.80      $ 5.38      $ 1,000.00      $ 1,019.81      $ 5.45        1.07     184        365   

Class R5

  $ 1,000.00      $ 995.40      $ 3.82      $ 1,000.00      $ 1,021.37      $ 3.87        0.76     184        365   

Class R6

  $ 1,000.00      $ 995.90      $ 3.47      $ 1,000.00      $ 1,021.73      $ 3.52        0.69     184        365   

Class Y

  $ 1,000.00      $ 995.90      $ 3.37      $ 1,000.00      $ 1,021.83      $ 3.41        0.67     184        365   

The Hartford Growth Opportunities Fund

 

    Actual Return     Hypothetical (5% return before expenses)                    
     Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Annualized
expense
ratio
    Days in
the
current
1/2 year
    Days in
the full
year
 

Class A

  $ 1,000.00      $ 1,017.80      $ 5.70      $ 1,000.00      $ 1,019.56      $ 5.70        1.12     184        365   

Class B

  $ 1,000.00      $ 1,013.20      $ 10.30      $ 1,000.00      $ 1,014.97      $ 10.31        2.03     184        365   

Class C

  $ 1,000.00      $ 1,014.20      $ 9.49      $ 1,000.00      $ 1,015.78      $ 9.50        1.87     184        365   

Class I

  $ 1,000.00      $ 1,018.90      $ 4.53      $ 1,000.00      $ 1,020.72      $ 4.53        0.89     184        365   

Class R3

  $ 1,000.00      $ 1,016.30      $ 7.37      $ 1,000.00      $ 1,017.90      $ 7.38        1.45     184        365   

Class R4

  $ 1,000.00      $ 1,017.70      $ 5.85      $ 1,000.00      $ 1,019.41      $ 5.85        1.15     184        365   

Class R5

  $ 1,000.00      $ 1,019.10      $ 4.33      $ 1,000.00      $ 1,020.92      $ 4.33        0.85     184        365   

Class R6

  $ 1,000.00      $ 1,019.20      $ 4.33      $ 1,000.00      $ 1,020.92      $ 4.33        0.85     184        365   

Class Y

  $ 1,000.00      $ 1,019.90      $ 3.82      $ 1,000.00      $ 1,021.43      $ 3.82        0.75     184        365   

 

 

  40  

 


Domestic Equity Funds

Expense Examples (Unaudited) – (continued)

 

 

 

The Hartford Healthcare Fund

 

    Actual Return     Hypothetical (5% return before expenses)                    
     Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Annualized
expense
ratio
    Days in
the
current
1/2 year
    Days in
the full
year
 

Class A

  $ 1,000.00      $ 1,012.00      $ 6.54      $ 1,000.00      $ 1,018.70      $ 6.56        1.29     184        365   

Class B

  $ 1,000.00      $ 1,007.50      $ 10.88      $ 1,000.00      $ 1,014.37      $ 10.92        2.15     184        365   

Class C

  $ 1,000.00      $ 1,008.40      $ 10.33      $ 1,000.00      $ 1,014.92      $ 10.36        2.04     184        365   

Class I

  $ 1,000.00      $ 1,013.40      $ 5.13      $ 1,000.00      $ 1,020.11      $ 5.14        1.01     184        365   

Class R3

  $ 1,000.00      $ 1,010.40      $ 8.11      $ 1,000.00      $ 1,017.14      $ 8.13        1.60     184        365   

Class R4

  $ 1,000.00      $ 1,012.10      $ 6.59      $ 1,000.00      $ 1,018.65      $ 6.61        1.30     184        365   

Class R5

  $ 1,000.00      $ 1,013.40      $ 5.13      $ 1,000.00      $ 1,020.11      $ 5.14        1.01     184        365   

Class Y

  $ 1,000.00      $ 1,014.30      $ 4.57      $ 1,000.00      $ 1,020.67      $ 4.58        0.90     184        365   

The Hartford MidCap Fund

 

    Actual Return     Hypothetical (5% return before expenses)                    
     Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Annualized
expense
ratio
    Days in
the
current
1/2 year
    Days in
the full
year
 

Class A

  $ 1,000.00      $ 1,008.40      $ 5.82      $ 1,000.00      $ 1,019.41      $ 5.85        1.15     184        365   

Class B

  $ 1,000.00      $ 1,003.50      $ 10.25      $ 1,000.00      $ 1,014.97      $ 10.31        2.03     184        365   

Class C

  $ 1,000.00      $ 1,004.40      $ 9.55      $ 1,000.00      $ 1,015.68      $ 9.60        1.89     184        365   

Class I

  $ 1,000.00      $ 1,009.70      $ 4.26      $ 1,000.00      $ 1,020.97      $ 4.28        0.84     184        365   

Class R3

  $ 1,000.00      $ 1,006.50      $ 7.43      $ 1,000.00      $ 1,017.80      $ 7.48        1.47     184        365   

Class R4

  $ 1,000.00      $ 1,008.10      $ 5.87      $ 1,000.00      $ 1,019.36      $ 5.90        1.16     184        365   

Class R5

  $ 1,000.00      $ 1,010.00      $ 4.36      $ 1,000.00      $ 1,020.87      $ 4.38        0.86     184        365   

Class R6

  $ 1,000.00      $ 1,010.20      $ 3.90      $ 1,000.00      $ 1,021.32      $ 3.92        0.77     184        365   

Class Y

  $ 1,000.00      $ 1,010.20      $ 3.85      $ 1,000.00      $ 1,021.37      $ 3.87        0.76     184        365   

The Hartford MidCap Value Fund

 

    Actual Return     Hypothetical (5% return before expenses)                    
     Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Annualized
expense
ratio
    Days in
the
current
1/2 year
    Days in
the full
year
 

Class A

  $ 1,000.00      $ 963.00      $ 6.23      $ 1,000.00      $ 1,018.85      $ 6.41        1.26     184        365   

Class B

  $ 1,000.00      $ 959.20      $ 10.32      $ 1,000.00      $ 1,014.67      $ 10.61        2.09     184        365   

Class C

  $ 1,000.00      $ 959.00      $ 9.78      $ 1,000.00      $ 1,015.22      $ 10.06        1.98     184        365   

Class I

  $ 1,000.00      $ 964.50      $ 4.46      $ 1,000.00      $ 1,020.67      $ 4.58        0.90     184        365   

Class R3

  $ 1,000.00      $ 962.30      $ 7.57      $ 1,000.00      $ 1,017.49      $ 7.78        1.53     184        365   

Class R4

  $ 1,000.00      $ 963.30      $ 6.04      $ 1,000.00      $ 1,019.06      $ 6.21        1.22     184        365   

Class R5

  $ 1,000.00      $ 964.80      $ 4.56      $ 1,000.00      $ 1,020.57      $ 4.69        0.92     184        365   

Class Y

  $ 1,000.00      $ 965.40      $ 4.01      $ 1,000.00      $ 1,021.12      $ 4.13        0.81     184        365   

 

 

  41  

 


Domestic Equity Funds

Expense Examples (Unaudited) – (continued)

 

 

 

Hartford Small Cap Core Fund

 

    Actual Return     Hypothetical (5% return before expenses)                    
     Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Annualized
expense
ratio
    Days in
the
current
1/2 year
    Days in
the full
year
 

Class A

  $ 1,000.00      $ 946.40      $ 6.28      $ 1,000.00      $ 1,018.75      $ 6.51        1.28     184        365   

Class B

  $ 1,000.00      $ 942.20      $ 10.04      $ 1,000.00      $ 1,014.87      $ 10.41        2.05     184        365   

Class C

  $ 1,000.00      $ 943.10      $ 9.94      $ 1,000.00      $ 1,014.97      $ 10.31        2.03     184        365   

Class I

  $ 1,000.00      $ 947.90      $ 4.86      $ 1,000.00      $ 1,020.22      $ 5.04        0.99     184        365   

Class R3

  $ 1,000.00      $ 945.50      $ 7.36      $ 1,000.00      $ 1,017.64      $ 7.63        1.50     184        365   

Class R4

  $ 1,000.00      $ 947.10      $ 5.89      $ 1,000.00      $ 1,019.16      $ 6.11        1.20     184        365   

Class R5

  $ 1,000.00      $ 948.10      $ 4.42      $ 1,000.00      $ 1,020.67      $ 4.58        0.90     184        365   

Class Y

  $ 1,000.00      $ 948.00      $ 4.17      $ 1,000.00      $ 1,020.92      $ 4.33        0.85     184        365   

The Hartford Small Company Fund

 

    Actual Return     Hypothetical (5% return before expenses)                    
     Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Annualized
expense
ratio
    Days in
the
current
1/2 year
    Days in
the full
year
 

Class A

  $ 1,000.00      $ 905.90      $ 6.39      $ 1,000.00      $ 1,018.50      $ 6.77        1.33     184        365   

Class B

  $ 1,000.00      $ 901.90      $ 10.16      $ 1,000.00      $ 1,014.52      $ 10.76        2.12     184        365   

Class C

  $ 1,000.00      $ 902.90      $ 9.83      $ 1,000.00      $ 1,014.87      $ 10.41        2.05     184        365   

Class I

  $ 1,000.00      $ 906.80      $ 5.33      $ 1,000.00      $ 1,019.61      $ 5.65        1.11     184        365   

Class R3

  $ 1,000.00      $ 904.60      $ 7.44      $ 1,000.00      $ 1,017.39      $ 7.88        1.55     184        365   

Class R4

  $ 1,000.00      $ 906.50      $ 6.01      $ 1,000.00      $ 1,018.90      $ 6.36        1.25     184        365   

Class R5

  $ 1,000.00      $ 907.50      $ 4.57      $ 1,000.00      $ 1,020.42      $ 4.84        0.95     184        365   

Class R6

  $ 1,000.00      $ 907.60      $ 4.33      $ 1,000.00      $ 1,020.67      $ 4.58        0.90     184        365   

Class Y

  $ 1,000.00      $ 908.00      $ 4.09      $ 1,000.00      $ 1,020.92      $ 4.33        0.85     184        365   

 

 

  42  

 


Domestic Equity Funds

Expense Examples (Unaudited) – (continued)

 

 

 

The Hartford SmallCap Growth Fund

 

    Actual Return     Hypothetical (5% return before expenses)                    
     Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Annualized
expense
ratio
    Days in
the
current
1/2 year
    Days in
the full
year
 

Class A

  $ 1,000.00      $ 964.10      $ 6.04      $ 1,000.00      $ 1,019.06      $ 6.21        1.22     184        365   

Class B

  $ 1,000.00      $ 960.70      $ 9.83      $ 1,000.00      $ 1,015.17      $ 10.11        1.99     184        365   

Class C

  $ 1,000.00      $ 960.60      $ 9.49      $ 1,000.00      $ 1,015.53      $ 9.75        1.92     184        365   

Class I

  $ 1,000.00      $ 965.60      $ 4.66      $ 1,000.00      $ 1,020.47      $ 4.79        0.94     184        365   

Class R3

  $ 1,000.00      $ 963.10      $ 7.37      $ 1,000.00      $ 1,017.69      $ 7.58        1.49     184        365   

Class R4

  $ 1,000.00      $ 964.60      $ 5.79      $ 1,000.00      $ 1,019.31      $ 5.96        1.17     184        365   

Class R5

  $ 1,000.00      $ 966.00      $ 4.31      $ 1,000.00      $ 1,020.82      $ 4.43        0.87     184        365   

Class R6

  $ 1,000.00      $ 965.50      $ 4.61      $ 1,000.00      $ 1,020.52      $ 4.74        0.93     184        365   

Class Y

  $ 1,000.00      $ 966.40      $ 3.82      $ 1,000.00      $ 1,021.32      $ 3.92        0.77     184        365   

The Hartford Value Opportunities Fund

 

    Actual Return     Hypothetical (5% return before expenses)                    
     Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Beginning
Account
Value
May 1,
2015
    Ending
Account
Value
October 31,
2015
    Expenses paid
during the period
May 1, 2015
through October 31,
2015
    Annualized
expense
ratio
    Days in
the
current
1/2 year
    Days in
the full
year
 

Class A

  $ 1,000.00      $ 938.60      $ 5.96      $ 1,000.00      $ 1,019.06      $ 6.21        1.22     184        365   

Class B

  $ 1,000.00      $ 935.20      $ 9.61      $ 1,000.00      $ 1,015.28      $ 10.01        1.97     184        365   

Class C

  $ 1,000.00      $ 935.30      $ 9.46      $ 1,000.00      $ 1,015.43      $ 9.86        1.94     184        365   

Class I

  $ 1,000.00      $ 940.90      $ 4.11      $ 1,000.00      $ 1,020.97      $ 4.28        0.84     184        365   

Class R3

  $ 1,000.00      $ 937.30      $ 7.37      $ 1,000.00      $ 1,017.59      $ 7.68        1.51     184        365   

Class R4

  $ 1,000.00      $ 938.80      $ 5.82      $ 1,000.00      $ 1,019.21      $ 6.06        1.19     184        365   

Class R5

  $ 1,000.00      $ 940.20      $ 4.40      $ 1,000.00      $ 1,020.67      $ 4.58        0.90     184        365   

Class Y

  $ 1,000.00      $ 940.80      $ 3.86      $ 1,000.00      $ 1,021.22      $ 4.02        0.79     184        365   

 

 

  43  

 


The Hartford Capital Appreciation Fund

Schedule of Investments

October 31, 2015

 

 

 

Shares or Principal Amount

 

Market Value

 
COMMON STOCKS - 94.7%  
      Automobiles & Components - 2.3%  
  1,075,863     

Delphi Automotive plc

  $ 89,501,043   
  393,319     

Fiat Chrysler Automobiles N.V. *

    5,794,822   
  295,578     

General Motors Co.

    10,318,628   
  2,595,187     

Goodyear Tire & Rubber Co.

    85,225,941   
  415,600     

Honda Motor Co., Ltd.

    13,748,229   
  109,900     

Magna International, Inc.

    5,795,889   
  136,400     

Thor Industries, Inc.

    7,376,512   
  236,632     

Volkswagen AG (Preference Shares)

    28,404,133   
   

 

 

 
      246,165,197   
   

 

 

 
      Banks - 5.5%  
  8,248,825     

Axis Bank Ltd.

    59,781,545   
  2,353,021     

Bank of America Corp.

    39,483,692   
  284,636     

BNP Paribas S.A.

    17,248,144   
  2,284,728     

Citigroup, Inc.

    121,478,988   
  4,395,130     

ICICI Bank Ltd.

    18,584,773   
  61,000     

ICICI Bank Ltd. ADR

    525,820   
  52,600     

Japan Post Bank Co., Ltd. *

    632,054   
  3,089,853     

JP Morgan Chase & Co.

    198,523,055   
  164,195     

M&T Bank Corp.

    19,678,771   
  887,627     

PNC Financial Services Group, Inc.

    80,117,213   
  196,000     

Sumitomo Mitsui Financial Group, Inc.

    7,819,154   
  592,407     

Wells Fargo & Co.

    32,072,915   
   

 

 

 
      595,946,124   
   

 

 

 
      Capital Goods - 5.0%  
  150,638     

3M Co.

    23,681,800   
  89,753     

AECOM *

    2,645,021   
  1,170,871     

AerCap Holdings N.V.

    48,591,146   
  230,647     

Airbus Group SE

    16,061,160   
  500,660     

Builders FirstSource, Inc. *

    5,917,801   
  104,190     

Danaher Corp.

    9,721,969   
  216,947     

DigitalGlobe, Inc.

    3,239,019   
  1,804,230     

DMG Mori Co., Ltd.

    25,677,271   
  547,798     

Eaton Corp. plc

    30,627,386   
  189,120     

Fortune Brands Home & Security, Inc.

    9,896,650   
  274,655     

Generac Holdings, Inc. *

    8,668,112   
  203,425     

General Electric Co.

    5,883,051   
  806,800     

HF Global, Inc. *(1)(2)

    9,762,248   
  159,400     

Honeywell International, Inc.

    16,462,832   
  126,141     

KLX, Inc. *

    4,933,374   
  372,334     

Lithium Technology Corp. *(1)(2)

    2,040,390   
  117,711     

Lockheed Martin Corp.

    25,876,409   
  101,981     

Northrop Grumman Corp.

    19,146,933   
  1,289,772     

Owens Corning

    58,723,319   
  575,184     

Raytheon Co.

    67,526,602   
  265,022     

Safran S.A.

    20,129,493   
  622,800     

Sanwa Holdings Corp.

    5,037,667   
  38,686     

Sulzer AG

    3,909,054   
  160,312     

TransDigm Group, Inc.

    35,244,593   
  568,827     

United Technologies Corp.

    55,978,265   
  99,420     

Wabco Holdings, Inc. *

    11,157,907   
  144,178     

WESCO International, Inc. *

    7,054,630   
   

 

 

 
      533,594,102   
   

 

 

 
      Commercial & Professional Services - 0.4%  
  75,219     

Clean Harbors, Inc. *

    3,496,931   
  135,416     

Equifax, Inc.

    14,431,283   
  75,000     

FTI Consulting, Inc.

    2,550,750   
  308,595     

Herman Miller, Inc.

    9,791,719   
  4,595     

Klarna Holding AB(1)(2)

    466,082   
  55,865     

Stericycle, Inc.

    6,780,335   
  362,400     

TriNet Group, Inc.

    6,878,352   
   

 

 

 
      44,395,452   
   

 

 

 

Shares or Principal Amount

 

Market Value

 
COMMON STOCKS - 94.7% - (continued)  
      Consumer Durables & Apparel - 2.9%  
  423,560     

Asics Corp.

  $ 11,699,020   
  549,105     

D.R. Horton, Inc.

    16,165,651   
  218,542     

Electrolux AB Series B

    6,429,586   
  31,734,000     

Global Brands Group Holding Ltd. *

    6,579,243   
  359,913     

Harman International Industries, Inc.

    39,576,033   
  440,487     

Kate Spade & Co. *

    7,915,551   
  515,773     

Lennar Corp. Class A

    25,824,754   
  118,692     

Luxottica Group S.p.A.

    8,320,348   
  4,178,701     

PulteGroup, Inc.

    76,595,589   
  60,900     

Ralph Lauren Corp.

    6,745,893   
  981,000     

Samsonite International S.A.

    2,904,801   
  3,300,125     

Sony Corp.

    93,807,381   
  275,615     

Vera Bradley, Inc.

    3,447,944   
   

 

 

 
      306,011,794   
   

 

 

 
      Consumer Services - 3.5%  
  440,490     

American Public Education, Inc. *

    9,571,848   
  23,655     

Chipotle Mexican Grill, Inc. *

    15,144,641   
  477,093     

Grand Canyon Education, Inc. *

    19,827,985   
  1,512,160     

Hilton Worldwide Holdings, Inc.

    37,788,878   
  805,555     

Las Vegas Sands Corp.

    39,883,028   
  578,865     

LifeLock, Inc. *

    8,109,899   
  322,925     

McDonald’s Corp.

    36,248,331   
  1,292,400     

Norwegian Cruise Line Holdings Ltd. *

    82,222,488   
  886,841     

Planet Fitness, Inc. Class A

    14,490,982   
  943,200     

Sands China Ltd.

    3,396,418   
  1,278,408     

Wyndham Worldwide Corp.

    103,998,491   
  135,362     

Wynn Resorts Ltd.

    9,468,572   
   

 

 

 
      380,151,561   
   

 

 

 
      Diversified Financials - 5.1%  
  244,632     

American Express Co.

    17,921,740   
  78,970     

Ameriprise Financial, Inc.

    9,109,979   
  251,482     

Banca Generali S.p.A.

    7,745,576   
  59,212     

Berkshire Hathaway, Inc. Class B

    8,054,016   
  164,518     

BlackRock, Inc.

    57,905,400   
  2,675,000     

Blackstone Group L.P.

    88,435,500   
  68,873     

Goldman Sachs Group, Inc.

    12,913,688   
  61,306     

Intercontinental Exchange, Inc.

    15,473,634   
  455,375     

LendingClub Corp. PIPE *

    6,457,218   
  46,328     

MarketAxess Holdings, Inc.

    4,693,490   
  427,226     

Markit, Ltd. *

    13,030,393   
  787,332     

McGraw Hill Financial, Inc.

    72,938,436   
  1,009,260     

MSCI, Inc.

    67,620,420   
  252,841     

Northern Trust Corp.

    17,797,478   
  66,875     

PJT Partners, Inc. Class A

    1,437,813   
  377,900     

PRA Group, Inc.

    20,708,920   
  228,847     

Raymond James Financial, Inc.

    12,611,758   
  1,578,120     

Springleaf Holdings, Inc. *

    74,029,609   
  304,330     

Waddell & Reed Financial, Inc. Class A

    11,241,950   
  280,644     

Wisdomtree Investments, Inc.

    5,396,784   
  9,427,772     

Zegona Communications plc *

    20,492,724   
   

 

 

 
      546,016,526   
   

 

 

 
      Energy - 3.7%  
  57,900     

Anadarko Petroleum Corp.

    3,872,352   
  524,365     

Atwood Oceanics, Inc.

    8,678,241   
  436,950     

Canadian Natural Resources Ltd.

    10,145,979   
  496,103     

Chevron Corp.

    45,085,841   
  2,294,648     

Cobalt International Energy, Inc. *

    17,599,950   
  113,799     

Continental Resources, Inc. *

    3,858,924   
  105,100     

Diamondback Energy, Inc. *

    7,760,584   
  864,500     

Ensco plc Class A

    14,376,635   
  1,882,549     

Halliburton Co.

    72,252,231   
 

 

The accompanying notes are an integral part of these financial statements.

 

 

  44  

 


The Hartford Capital Appreciation Fund

Schedule of Investments – (continued)

October 31, 2015

 

 

 

Shares or Principal Amount

 

Market Value

 
COMMON STOCKS - 94.7% - (continued)  
      Energy - 3.7% - (continued)  
  111,321     

Helmerich & Payne, Inc.

  $ 6,264,033   
  165,402     

HollyFrontier Corp.

    8,099,736   
  1,173,087     

Imperial Oil Ltd.

    39,005,143   
  1,257,118     

Karoon Gas Australia Ltd. *

    1,577,789   
  405,415     

Laredo Petroleum, Inc. *

    4,654,164   
  324,500     

Marathon Oil Corp.

    5,964,310   
  1,733,972     

McDermott International, Inc. *

    7,993,611   
  116,529     

National Oilwell Varco, Inc.

    4,386,152   
  97,571     

Newfield Exploration Co. *

    3,921,378   
  344,070     

Occidental Petroleum Corp.

    25,646,978   
  385,585     

Patterson-UTI Energy, Inc.

    5,741,361   
  216,695     

Pioneer Natural Resources Co.

    29,717,552   
  299,340     

QEP Resources, Inc.

    4,627,796   
  352,745     

Rice Energy, Inc. *

    5,382,889   
  1,509,708     

Southwestern Energy Co. *

    16,667,176   
  948,917     

Suncor Energy, Inc.

    28,211,302   
  34,155     

Superior Energy Services, Inc.

    483,635   
  2,726,600     

Trican Well Service Ltd. *

    1,814,119   
  646,928     

Whiting Petroleum Corp. *

    11,146,569   
   

 

 

 
      394,936,430   
   

 

 

 
      Food & Staples Retailing - 0.2%      
  41,350     

Ain Pharmaciez, Inc.

    1,957,458   
  42,598     

Costco Wholesale Corp.

    6,735,596   
  313,730     

Seven & I Holdings Co., Ltd.

    14,251,125   
   

 

 

 
      22,944,179   
   

 

 

 
      Food, Beverage & Tobacco - 4.5%      
  49,038     

Anheuser-Busch InBev N.V.

    5,851,440   
  98,543     

Anheuser-Busch InBev N.V. ADR

    11,759,136   
  723,563     

British American Tobacco plc

    42,986,553   
  1,578,005     

Coca-Cola Co.

    66,828,512   
  1,416,081     

ConAgra Foods, Inc.

    57,422,085   
  1,492,603     

Freshpet, Inc. *

    14,552,879   
  1,070,611     

Greencore Group plc

    4,978,008   
  712,665     

Molson Coors Brewing Co. Class B

    62,785,786   
  3,450,937     

Mondelez International, Inc. Class A

    159,295,252   
  316,767     

Monster Beverage Corp. *

    43,181,677   
  446,625     

Nomad Foods Ltd. *

    6,520,725   
  81,405     

Post Holdings, Inc. *

    5,231,899   
   

 

 

 
      481,393,952   
   

 

 

 
      Health Care Equipment & Services - 3.9%      
  291,583     

Acadia Healthcare Co., Inc. *

    17,906,112   
  569,097     

Becton Dickinson and Co.

    81,107,705   
  453,970     

Cardinal Health, Inc.

    37,316,334   
  533,600     

CareView Communications, Inc. *

    166,910   
  157,377     

Cerner Corp. *

    10,432,521   
  36,900     

Cigna Corp.

    4,946,076   
  129,692     

Dentsply International, Inc.

    7,891,758   
  294,493     

Edwards Lifesciences Corp.

    46,279,575   
  140,200     

Envision Healthcare Holdings, Inc. *

    3,953,640   
  116,807     

Essilor International S.A.

    15,332,487   
  42,400     

Express Scripts Holding Co.

    3,662,512   
  1,023,567     

HCA Holdings, Inc. *

    70,411,174   
  442,372     

IMS Health Holdings, Inc. *

    12,041,366   
  131,900     

McKesson Corp.

    23,583,720   
  375,107     

Medtronic plc

    27,727,909   
  358,556     

UnitedHealth Group, Inc.

    42,230,726   
  79,340     

Universal Health Services, Inc. Class B

    9,686,621   
  64,100     

Zimmer Biomet Holdings, Inc.

    6,702,937   
   

 

 

 
      421,380,083   
   

 

 

 

Shares or Principal Amount

 

Market Value

 
COMMON STOCKS - 94.7% - (continued)  
      Household & Personal Products - 0.6%      
  5,227,595     

Avon Products, Inc.

  $ 21,067,208   
  136,706     

Beiersdorf AG

    12,983,771   
  50,400     

Colgate-Palmolive Co.

    3,344,040   
  338,333     

Estee Lauder Cos., Inc. Class A

    27,222,273   
  31,400     

Kose Corp.

    3,066,511   
   

 

 

 
      67,683,803   
   

 

 

 
      Insurance - 5.3%  
  1,475,271     

ACE Ltd.

    167,502,269   
  2,321,335     

American International Group, Inc.

    146,383,385   
  208,447     

Arthur J Gallagher & Co.

    9,115,387   
  3,365,000     

China Life Insurance Co., Ltd. Class H

    12,134,466   
  13,000     

Japan Post Insurance Co., Ltd.

    237,010   
  243,550     

Lincoln National Corp.

    13,032,361   
  16,501     

Markel Corp.

    14,322,868   
  582,037     

Marsh & McLennan Cos., Inc.

    32,442,743   
  996,662     

MetLife, Inc.

    50,211,832   
  349,242     

Principal Financial Group, Inc.

    17,517,979   
  1,025,700     

Prudential Financial, Inc.

    84,620,250   
  200,529     

Torchmark Corp.

    11,632,687   
  262,519     

Unum Group

    9,096,283   
   

 

 

 
      568,249,520   
   

 

 

 
      Materials - 3.1%  
  110,900     

Bemis Co., Inc.

    5,077,002   
  465,972     

BRAAS Monier Building Group S.A.

    12,199,683   
  102,700     

Cabot Corp.

    3,691,038   
  140,578     

Celanese Corp. Series A

    9,988,067   
  440,900     

Chemours Co.

    3,055,437   
  389,219     

Constellium N.V. Class A *

    1,467,356   
  190,100     

Continental Gold, Inc. *

    236,971   
  416,664     

Huntsman Corp.

    5,487,465   
  19,313,200     

Ivanhoe Mines Ltd. Class A *

    10,338,972   
  2,233,229     

Louisiana-Pacific Corp. *

    39,438,824   
  1,163,366     

Methanex Corp.

    46,426,777   
  764,430     

Norbord, Inc.

    14,445,599   
  770,135     

Packaging Corp. of America

    52,715,741   
  556,016     

Platform Specialty Products Corp. *

    5,804,807   
  376,412     

Praxair, Inc.

    41,815,609   
  277,978     

Reliance Steel & Aluminum Co.

    16,667,561   
  138,900     

Rio Tinto plc ADR

    5,071,239   
  680,880     

Wacker Chemie AG

    59,751,893   
   

 

 

 
      333,680,041   
   

 

 

 
      Media - 1.8%  
  259,795     

CBS Corp. Class B

    12,085,663   
  11,937     

DISH Network Corp. Class A

    751,673   
  325,695     

Quebecor, Inc. Class B

    7,669,126   
  5,123,287     

Sky plc

    86,459,154   
  84,743     

Tribune Media Co. Class A

    3,417,685   
  2,853,900     

Twenty-First Century Fox, Inc. Class A

    87,586,191   
   

 

 

 
      197,969,492   
   

 

 

 
      Pharmaceuticals, Biotechnology & Life Sciences - 13.2%  
  22,235     

Agios Pharmaceuticals, Inc. *

    1,620,042   
  249,828     

Alkermes plc *

    17,967,630   
  715,040     

Allergan plc *

    220,568,389   
  46,253     

Alnylam Pharmaceuticals, Inc. *

    3,975,445   
  93,890     

Amgen, Inc.

    14,851,520   
  821,189     

Arena Pharmaceuticals, Inc. *

    1,552,047   
  197,200     

AstraZeneca plc

    12,568,048   
  212,090     

AstraZeneca plc ADR

    6,763,550   
  86,052     

Biogen, Inc. *

    24,998,967   
 

 

The accompanying notes are an integral part of these financial statements.

 

 

  45  

 


The Hartford Capital Appreciation Fund

Schedule of Investments – (continued)

October 31, 2015

 

 

 

Shares or Principal Amount

 

Market Value

 
COMMON STOCKS - 94.7% - (continued)  
      Pharmaceuticals, Biotechnology & Life
Sciences - 13.2% -
(continued)
 
  81,256     

BioMarin Pharmaceutical, Inc.

  $ 9,510,202   
  5,309,722     

Bristol-Myers Squibb Co.

    350,176,166   
  148,644     

Celgene Corp. *

    18,240,105   
  958,975     

Eisai Co., Ltd.

    59,983,491   
  64,069     

Five Prime Therapeutics, Inc. *

    2,059,818   
  213,170     

Gilead Sciences, Inc.

    23,050,072   
  352,200     

ICON plc *

    22,495,014   
  42,149     

Illumina, Inc. *

    6,039,109   
  131,305     

Incyte Corp. *

    15,432,277   
  560,961     

Johnson & Johnson

    56,673,890   
  4,976,115     

Merck & Co., Inc.

    271,994,446   
  2,717,213     

Mylan N.V. *

    119,801,921   
  69,750     

Ono Pharmaceutical Co., Ltd.

    9,555,379   
  41,700     

Perrigo Co. plc

    6,577,758   
  448,035     

Portola Pharmaceuticals, Inc. *

    21,330,946   
  22,777     

PTC Therapeutics, Inc. *

    566,464   
  55,664     

Regeneron Pharmaceuticals, Inc. *

    31,026,557   
  90,985     

Roche Holding AG

    24,702,324   
  1,877,915     

Sun Pharmaceutical Industries Ltd.

    25,536,079   
  174,928     

TESARO, Inc. *

    7,953,976   
  2,275,562     

TherapeuticsMD, Inc. *

    13,357,549   
  133,249     

Vertex Pharmaceuticals, Inc. *

    16,621,480   
   

 

 

 
      1,417,550,661   
   

 

 

 
      Real Estate - 1.3%  
  244,714     

American Tower Corp. REIT

    25,017,112   
  56,199     

AvalonBay Communities, Inc. REIT

    9,825,271   
  330,550     

CBRE Group, Inc. Class A

    12,322,904   
  365,321     

Columbia Property Trust, Inc. REIT

    9,074,574   
  272,600     

Host Hotels & Resorts, Inc. REIT

    4,724,158   
  22,425     

Relo Holdings, Inc.

    2,411,242   
  2,005,148     

Vonovia SE

    66,839,462   
  153,417     

WeWork Companies, Inc. Class A *(1)(2)

    4,541,235   
  189,905     

Weyerhaeuser Co. REIT

    5,569,914   
   

 

 

 
      140,325,872   
   

 

 

 
      Retailing - 5.4%  
  418,291     

Advance Auto Parts, Inc.

    83,001,483   
  236,375     

Amazon.com, Inc. *

    147,947,113   
  194,470     

CarMax, Inc.

    11,475,675   
  1,598,500     

Chico’s FAS, Inc.

    22,091,270   
  216,390     

Dollar Tree, Inc.

    14,171,381   
  1,940,969     

Groupon, Inc. *

    7,200,995   
  377,750     

Home Depot, Inc.

    46,705,010   
  12,011     

Honest Co. *(1)(2)

    494,607   
  51,552     

HSN, Inc.

    3,188,491   
  10,615     

JAND, Inc. Class A *(1)(2)

    109,725   
  127,677     

L Brands, Inc.

    12,254,439   
  378,882     

Lowe’s Cos., Inc.

    27,972,858   
  713,709     

Michaels Cos., Inc.

    16,686,516   
  21,100     

Priceline Group, Inc. *

    30,684,464   
  629,283     

Signet Jewelers Ltd.

    94,983,976   
  97,960     

Staples, Inc.

    1,272,500   
  626,898     

TJX Cos., Inc.

    45,882,665   
  152,898     

TripAdvisor, Inc.

    12,809,794   
  473,000     

Tuesday Morning Corp.

    2,558,930   
   

 

 

 
      581,491,892   
   

 

 

 
      Semiconductors & Semiconductor Equipment - 4.9%  
  738,138     

Cypress Semiconductor Corp.

    7,779,975   
  31,626,050     

GCL-Poly Energy Holdings Ltd. *

    6,532,330   
  5,232,824     

Intel Corp.

    177,183,421   

Shares or Principal Amount

 

Market Value

 
COMMON STOCKS - 94.7% - (continued)  
      Semiconductors & Semiconductor Equipment - 4.9% -
(continued)
 
  161,028     

Maxim Integrated Products, Inc.

  $ 6,598,927   
  4,123,961     

Micron Technology, Inc. *

    68,292,794   
  1,479,144     

NXP Semiconductors N.V. *

    115,890,932   
  11,702     

Qorvo, Inc.

    514,069   
  126,981     

Silicon Motion Technology Corp. ADR

    4,036,726   
  335,606     

SK Hynix, Inc.

    8,981,563   
  1,579,350     

Sumco Corp.

    15,920,958   
  322,163     

SunEdison Semiconductor Ltd. *

    3,463,252   
  1,599,983     

SunEdison, Inc. *

    11,679,876   
  3,531,458     

SunPower Corp. *

    94,784,333   
  85,600     

Synaptics, Inc.

    7,283,704   
   

 

 

 
      528,942,860   
   

 

 

 
      Software & Services - 13.2%  
  446,003     

Accenture plc Class A

    47,811,522   
  4,976,616     

Activision Blizzard, Inc.

    172,987,172   
  1,135,376     

Adobe Systems, Inc. *

    100,662,436   
  200,811     

Akamai Technologies, Inc. *

    12,213,325   
  951,281     

Alibaba Group Holding Ltd. ADR *

    79,745,886   
  36,624     

Alphabet, Inc. Class A *

    27,006,171   
  287,029     

Alphabet, Inc. Class C *

    204,023,084   
  50,581     

Apigee Corp.

    488,107   
  267,385     

Automatic Data Processing, Inc.

    23,259,821   
  376,969     

Baidu, Inc. ADR *

    70,670,378   
  222,300     

Blackhawk Network Holdings, Inc.

    9,465,534   
  215,200     

Cognizant Technology Solutions Corp. Class A *

    14,657,272   
  319,378     

CoStar Group, Inc.

    64,856,090   
  186,640     

Envestnet, Inc. *

    5,573,070   
  596,651     

Everyday Health, Inc. *

    5,608,519   
  1,770,226     

Facebook, Inc. Class A *

    180,509,945   
  637,259     

Genpact Ltd. *

    15,791,278   
  635,219     

Gogo, Inc. *

    8,975,645   
  3,337,731     

Microsoft Corp.

    175,698,160   
  374,370     

Nintendo Co., Ltd.

    59,849,259   
  1,379,759     

Optimal Payments plc *

    6,445,987   
  176,203     

Pandora Media, Inc. *

    2,028,097   
  1,091,206     

Quotient Technology, Inc. *

    6,045,281   
  161,194     

Salesforce.com, Inc. *

    12,526,386   
  177,478     

ServiceNow, Inc. *

    14,491,079   
  122,065     

Shutterstock, Inc. *

    3,476,411   
  280,905     

Verint Systems, Inc. *

    13,365,460   
  172,575     

VeriSign, Inc.

    13,909,545   
  1,267,848     

Web.com Group, Inc. *

    29,756,393   
  212,086     

Workday, Inc. Class A

    16,748,431   
  221,300     

Yandex N.V. Class A *

    3,562,930   
  70,276     

Zillow Group, Inc. Class A *

    2,165,204   
  372,002     

Zillow Group, Inc. Class C *

    10,300,735   
   

 

 

 
      1,414,674,613   
   

 

 

 
      Technology Hardware & Equipment - 2.6%  
  1,130,790     

Alps Electric Co., Ltd.

    35,098,794   
  239,909     

Amphenol Corp. Class A

    13,007,866   
  154,995     

Apple, Inc.

    18,521,903   
  554,361     

ARRIS Group, Inc.

    15,666,242   
  512,023     

Belden, Inc.

    32,784,833   
  489,910     

CDW Corp. of Delaware

    21,894,078   
  3,807,379     

Cisco Systems, Inc.

    109,842,884   
  105,555     

F5 Networks, Inc.

    11,632,161   
  1,139,910     

ParkerVision, Inc. *

    239,837   
  6,400     

Pure Storage, Inc. Class A *

    112,832   
  6,596     

Samsung Electronics Co., Ltd.

    7,911,411   
 

 

The accompanying notes are an integral part of these financial statements.

 

 

  46  

 


The Hartford Capital Appreciation Fund

Schedule of Investments – (continued)

October 31, 2015

 

 

 

Shares or Principal Amount

 

Market Value

 
COMMON STOCKS - 94.7% - (continued)  
      Technology Hardware & Equipment - 2.6% - (continued)  
  307,864     

Stratasys Ltd. *

  $ 7,850,532   
  116,311     

Western Digital Corp.

    7,771,901   
   

 

 

 
      282,335,274   
   

 

 

 
      Telecommunication Services - 0.4%  
  62,085     

SoftBank Group Corp.

    3,478,493   
  123,429     

T-Mobile US, Inc.

    4,676,725   
  666,223     

Verizon Communications, Inc.

    31,232,534   
   

 

 

 
      39,387,752   
   

 

 

 
      Transportation - 4.8%  
  83,539     

Alaska Air Group, Inc.

    6,369,849   
  254,680     

American Airlines Group, Inc.

    11,771,309   
  454,700