N-CSR/A 1 a14-22446_2ncsra.htm N-CSR/A

 

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

811-02064

 

PAX WORLD FUNDS SERIES TRUST I

(Exact name of registrant as specified in charter)

 

30 Penhallow Street, Suite 400, Portsmouth, NH

 

03801

(Address of principal executive offices)

 

(Zip code)

 

Pax World Management LLC

30 Penhallow Street, Suite 400, Portsmouth, NH  03801

Attn.:  Joseph Keefe

(Name and address of agent for service)

 

Registrant’s telephone number, including area code:

800-767-1729

 

 

Date of fiscal year end:

December 31

 

 

Date of reporting period:

December 31, 2013

 

 

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, 450 Fifth Street, NW, Washington, DC  20549-0609.  The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. §3507.

 



 

Item 1.                                 Reports to Stockholders

 



December 31, 2013

ANNUAL
REPORT

The ESG Managers® Asset Allocation Portfolios

ESG Managers® Growth Portfolio

Class A (PAGAX)

Institutional Class (PAGIX)

Class C (PAGCX)

ESG Managers® Growth and Income Portfolio

Class A (PGPAX)

Institutional Class (PMIIX)

Class C (PWCCX)

ESG Managers® Balanced Portfolio

Class A (PMPAX)

Institutional Class (PWPIX)

Class C (PWPCX)

ESG Managers® Income Portfolio

Class A (PWMAX)

Institutional Class (PWMIX)

Class C (PWMCX)

Pax World Management LLC is the investment adviser to ESG Managers® Portfolios




Table of Contents

Letter to Shareholders

   

2

   

Portfolio Commentary

   

7

   

Portfolio Highlights

 

ESG Managers® Growth Portfolio

   

13

   

ESG Managers® Growth and Income Portfolio

   

16

   

ESG Managers® Balanced Portfolio

   

20

   

ESG Managers® Income Portfolio

   

24

   

Shareholder Expense Examples

   

28

   

Schedules of Investments

   

30

   

Statements of Assets and Liabilities

   

38

   

Statements of Operations

   

42

   

Statements of Changes in Net Assets

   

44

   

Statements of Changes in Net Assets—Shares of Beneficial Interest

   

46

   

Financial Highlights

   

48

   

Notes to Financial Statements

   

52

   

Report of the Independent Registered Public Accounting Firm

   

72

   

For More Information

General Fund Information

877.374.7678

Shareholder Account Information

888.374.8920

Account Inquiries

ESG Managers Portfolios

P.O. Box 55389

Boston, MA 02205-5389

Investment Adviser

Pax World Management LLC

30 Penhallow Street, Suite 400

Portsmouth, NH 03801

Transfer and
Dividend Disbursing Agent

Boston Financial Data Services

P.O. Box 55389

Boston, MA 02205-5389

Custodian

State Street Bank and Trust Company

1 Lincoln Street

Boston, MA 02111




Letter to Shareholders

by Joseph Keefe, President and CEO

Dear fellow shareholders,

I am pleased to report that, in a year characterized by soaring equity markets, each of the Pax World ESG Managers Portfolios delivered positive investment returns in 2013. The Growth & Income Portfolio, Balanced Portfolio and Income Portfolio outperformed their blended benchmarks, while the Growth Portfolio slightly underperformed its blended benchmark, for the year ended December 31, 2013.

As 2014 begins, we can only hope that our somewhat tepid economic recovery begins to be felt on Main Street as well as Wall Street. 2013 certainly underscored the fact that financial markets and the underlying economy are not always in sync. This disconnect may in fact be worsening. Continued high levels of unemployment and anemic economic growth uncomfortably co-exist alongside outsized market gains the likes of which we have not seen in many years. The returns delivered by financial markets simply are not as widely distributed as would be the benefits of a true economic recovery. Thus, some Americans have seen their investment portfolios grow while the vast majority of Americans have seen their standard of living remain static, or even worsen. A growing chorus of concern about widening economic inequality previews the policy debates that may dominate 2014.

Globally, markets generally trailed the strong U.S. recovery over the past year, although there is some sentiment going into 2014 that we will see continued economic recovery in Europe and perhaps in other parts of the globe. At Pax World, we continue to believe that a globally diversified portfolio constitutes the best investment strategy going forward. Our colleagues at Morningstar Associates, who set the asset allocation targets for ESG Managers Portfolios, are very much of the same mind.

For most of the past three years, our asset allocation targets across the ESG Managers Portfolios have tended to be overweight the U.S. and underweight non-U.S. developed markets—given steady if unspectacular growth in the U.S. economy contrasted with slower growth elsewhere in the developed world as well as in emerging markets. In fact, emerging economies may continue to face


2



headwinds in 2014 as the U.S. Federal Reserve (the "Fed") winds down its bond purchasing program. Although Europe shows signs of emerging from recession and stock-market valuations in the U.S. have reached healthy levels, we are not inclined to stray significantly from our current strategic targets. On the fixed-income side, we continue to be underweight interest rate-sensitive strategies and overweight credit-sensitive strategies.

ESG Managers Portfolios were founded on the belief that funds that invest in companies with strong sustainability or environmental, social and governance ("ESG") characteristics can deliver competitive financial performance as well as positive social and environmental outcomes over time. Accordingly, we have assembled some of the most experienced, well-known investment managers in the sustainable investment arena, all under one-roof, in a series of asset allocation funds that we hope can provide a one-stop solution for investors and their financial advisors. As the financial crisis and recession recede and global economic growth slowly gains momentum, we continue to believe that the ESG Managers Portfolios provide an attractive option for investors and advisors who seek to integrate ESG concerns into their investments while gaining exposure to global stock and bond markets.

We also continue to take our responsibilities as investors seriously. We remain active investors, pressing the companies we own—through proxy voting, dialogue, shareholder resolutions and other strategies—to embrace higher ESG standards, whether it be naming women to their boards of directors, taking steps to report on and reduce greenhouse gas emissions, disclosing their lobbying and political activity or other positive actions. We believe investors can make a difference, and we are determined to do so.

As 2014 begins, our goals remain the same: to deliver competitive investment performance across ESG Managers Portfolios by assembling a group of funds and investment managers that invest in companies that meet credible environmental, social and governance standards; to serve and represent our shareholders as best we possibly can; and to leverage our influence as investors to achieve positive social and environmental outcomes—for our own communities and for the larger global community.


3



We will do our best to live up to these commitments in the year ahead.

Sincerely,

Joseph F. Keefe
President and CEO


4



Performance Information

Commentary The portfolio manager commentaries in this report provide insight from the respective fund managers in an effort to help you examine your fund. The views expressed therein are those of the portfolio managers and are for the period covered by this report. Such commentary does not necessarily represent the views of the Board of Trustees of your fund. The views expressed herein are subject to change at any time based upon market and/or other conditions and Pax World Management LLC, Morningstar Associates, LLC and the funds disclaim any responsibility to update such views. The commentaries should not be relied upon as investment advice.

Historical performance Historical performance can be evaluated in several ways. Each fund's portfolio highlights provide total and average annual total returns. A comparison of this historical data to an appropriate benchmark is also provided. These performance figures include changes in a fund's share price, plus reinvestment of any dividends (generally income) and any capital gains (generally profits the fund earns when it sells securities that have grown in value).

The Funds' distributor, ALPS Distributors, Inc., is not affiliated with Pax World Management LLC or Morningstar Associates, LLC.


5




As of October 1, 2013, the ESG Managers Portfolios transitioned to investing primarily through mutual funds and/or exchange-traded funds ("ETFs"). Prior to that date, the ESG Managers Portfolios had followed a manager-of-managers approach rather than a fund-of-funds approach, primarily investing directly in separately managed "sleeves" of securities managed by multiple managers as well as in mutual funds and ETFs (both affiliated and unaffiliated). Morningstar Associates, LLC determines the allocation of the ESG Managers Portfolios among mutual funds and ETFs, as well as one remaining sleeve of large cap value securities managed by ClearBridge Advisors, LLC ("ClearBridge"). ClearBridge and each of the advisers of the mutual funds and ETFs in which the ESG Managers Portfolios invest follows its own environmental, social and governance (ESG) criteria. The table below lists the mutual funds and strategies in which the ESG Managers Portfolios were invested as of December 31, 2013. The mutual funds and ETFs in which the ESG Managers Portfolios invest may change at any time without notice.

Sleeve Subadviser or Fund Manager

 

Strategy

 

Access Capital Strategies

 

Investment Grade Fixed Income*

 

Ariel Investments, LLC

 

Small/Mid Cap Value*

 

ClearBridge Advisors, LLC

 

Large Cap Value

 

Community Capital Management, Inc.

 

Investment Grade Fixed Income*

 

Miller/Howard Investments, Inc.

 

Equity Income*

 

Everence Capital Management

 

Investment Grade Fixed Income*

 

Neuberger Berman Management, LLC

 

Large Cap Blend*

 

Parnassus Investments

 

Equity Income*

 

Portfolio 21 Investments

 

World Stock*

 

Pax World Management LLC

 

Global Environmental Markets*

 

Pax World Management LLC

 

High Yield Bond*

 

Pax World Management LLC

 

Mixed Asset*

 

Pax World Management LLC

 

Small Cap*

 

Pax World Management LLC

 

International Equity*

 

Pax World Management LLC

 

Passive International Equity*

 

PIMCO

 

Income*

 

Schroder Investment Management, Ltd.

 

Emerging Markets Equity*

 

TIAA-CREF

 

Social Choice Bond*

 

*Some or all of the Strategy is represented by direct investments in mutual fund shares (see Schedules of Investments).


6



December 31, 2013

Portfolio Commentary

Portfolio Construction Advisors

Jon Hale, Ph.D., CFA, Managing Consultant, Morningstar Associates & Peter Di Teresa, Senior Investment Consultant, Morningstar Associates

The ESG Managers Portfolios garnered strong returns in 2013, certainly helped by the surging U.S. stock market but also benefiting from good allocation decisions and benchmark-topping performances by most of its underlying equity and bond managers. Before we review the year and look toward the future, let's first take a moment to describe these unique investments.

Pax World Management LLC (the advisor) and Morningstar Associates LLC (the subadvisor/portfolio construction manager) created the ESG Managers Portfolios so that individual and institutional investors could easily incorporate sustainable investment principles into their portfolios using a single investment vehicle. The four ESG Managers Portfolios are broadly diversified funds of funds (that also use separate accounts in some instances) covering a wide range of investor risk profiles, using underlying managers who all consider environmental, social, and governance (ESG) factors in their investment processes. Selecting the ESG Managers Portfolio that most closely matches their risk profile allows investors to use it as a stand-alone sustainable investment portfolio, or as a supplement to their existing portfolio without altering their preferred asset allocation.

•  The ESG Managers Growth is an all equity globally diversified portfolio that is normally allocated approximately two thirds to U.S. stocks, one fourth to developed-markets stocks outside the U.S., and about 10% to emerging-markets stocks. The portfolio is further diversified across market caps and investment styles.

•  ESG Managers Growth and Income is a lower volatility equity portfolio that puts greater emphasis on dividend-generating stocks than the Growth portfolio does, and also includes a fixed income allocation of around 20% of assets, typically, that serves to lower overall volatility and generate income through its higher yielding bond positions.


7



December 31, 2013

Portfolio Commentary, continued

•  ESG Managers Balanced is a broadly diversified take on the traditional 60/40 stock/bond balanced fund. Its equity allocation is similar to that of the Growth portfolio with positions in U.S. and non-U.S. stocks across market cap and style spectra. Its bond allocation is a mix of investment grade, core-plus and high yield approaches.

•  ESG Managers Income is our most conservative option with a target equity allocation of 35%. The equity allocation is tilted towards dividend generating stocks (similar to the equity allocation in Growth and Income). Its bond allocation is broadly diversified (similar to the bond allocation in Balanced) with a mix of investment grade, core-plus and high-yield approaches.

We use seventeen underlying funds or separate-account strategies in the portfolios from thirteen different investment firms. They have been selected based on strong long-term performance and how well the strategies fit with each other in our portfolios. Underlying strategies are removed when they fail to live up to our expectations for performance and style consistency. Our allocations are based on strategic targets set by the portfolio construction managers in consultation with Morningstar's Asset Allocation Committee, shorter-term market conditions, and the positioning decisions of the underlying managers, which we monitor on a regular basis. Rebalancing and reallocation are ongoing processes that happen on an as-needed basis using daily cash flows whenever possible.

Market Review

With all that in mind, let's take a brief look at 2013. Stocks in the U.S. were the big story, backed by monetary stimulus in the form of the Fed quantitative easing1 and by continued economic growth, albeit growth that continued to be below trend for a recovery. The S&P 500 Stock Index2 gained 32.39%, marking its highest calendar year return since 1997. Stocks outside the U.S. were mixed. The MSCI EAFE Index3 of developed markets stocks gained 22.78% on the strength of Japan's economic stimulus and the emergence of the eurozone from its recession and debt crisis. Emerging markets, often a source of much better performance when developed markets rally, were negative for the year as Brazil's economy struggled with low growth and high inflation and China's high growth engine shifted to lower gear as the country moved toward a more consumer oriented economy. The anticipation of tightened monetary policy in


8



December 31, 2013

Portfolio Commentary, continued

the U.S. was also a factor, as the Fed's quantitative easing program had supported riskier assets. MSCI Emerging Markets Index4 lost 2.60%. Fixed-income markets also suffered in anticipation of tighter monetary policy. The Barclays U.S. Aggregate Bond Index5 slipped 2.02%, its first calendar year loss since 1999. Less interest rate sensitive bond sectors avoided losses, trading on the improving economy. The Barclays U.S. Corporate High Yield Index6 rose 7.44% for the year.

Against that backdrop, the ESG Managers Portfolios Class A shares posted net returns ranging from 9.54% for the Income Portfolio to 28.74% for the Growth Portfolio. Three of the four portfolios comfortably beat their blended benchmarks7 on a net basis and the fourth came very close. (See accompanying table)

Total returns for the 12-month period ended December 31, 2013:

Class A Shares

 

Portfolio

  Blended
Benchmark7
 

Growth Portfolio

   

28.84

%

   

29.15

%

 

Growth and Income Portfolio

   

23.86

%

   

22.52

%

 

Balanced Portfolio

   

17.48

%

   

16.01

%

 

Income Portfolio

   

9.65

%

   

8.14

%

 

Performance Highlights

Emerging markets position responsible for Growth Portfolio's narrow underperformance

Despite an outstanding return of more than 28%, the Growth Portfolio fell just short of its blended benchmark. While such a narrow gap is of little real consequence, it resulted primarily from our "off-benchmark" emerging-markets position, which averaged between 5% and 6% of assets over the course of the year, costing the Portfolio an estimated one percentage point of return relative to the benchmark. Our non-U.S. equity position in the blended benchmark is represented solely by the MSCI EAFE Index which, as we've already discussed, outperformed the MSCI Emerging Markets Index by more than 25 percentage points. Of some consolation is the fact that our emerging markets manager, Schroder Emerging Markets Equity, modestly outperformed the MSCI Emerging Markets Index for the year. The other three Portfolios also had off-benchmark emerging markets exposure that detracted from performance but all three comfortably outperformed their blended benchmarks.


9



December 31, 2013

Portfolio Commentary, continued

Equity overweight helped Growth and Income, Balanced and Income Portfolios

In light of the strong equity market, we kept the three multi-asset class portfolios overweight their equity targets for most of the year by about three percentage points, with the overweight focused on U.S. large cap and mid cap stocks. This benefitted the Portfolios as stocks outperformed bonds by a wide margin, and U.S. stocks comfortably outperformed non-U.S. stocks.

Reallocation away from U.S. Treasury Inflation Protected Securities (TIPS) helped Growth and Income, Balanced and Income Portfolios

We entered the year with modest allocations to TIPS in these three Portfolios. Absent expectations of rising inflation, however, inflation-protected bonds tend to behave like long term credits and are, therefore, extremely sensitive to rising interest rates. With rates starting to rise early in the year, we sold positions, a move that proved beneficial. The Barclays U.S. Treasury TIPS Index8 lost -8.61% for the year.

Reallocation from Parnassus Small Cap Fund

Parnassus Small Cap underperformed during the first half of 2013 even though we were in the type of up market in which the fund had performed well in the past. During the first half of 2013, we reallocated largely to the Pax World Small Cap Fund.

Strong overall performance of underlying strategies

It was a strong year overall for our underlying strategies when we measure each one by its own best-fitting index. Of the 17 strategies being used at the end of the year, 12 beat their benchmarks for 2013. That's an excellent number because all but one are actively managed. It not only demonstrated, at least for 2013, that carefully chosen active managers can deliver alpha10 but also that ESG—oriented managers can deliver alpha.

Outlook

We entered the new year optimistic that continued economic growth, though modest, would provide the underpinning for another positive year for stocks. That said, we don't expect returns anywhere close to those of 2013 nor do we expect the ride to be completely smooth. Stocks continue to look approximately fairly valued to us. The median stock in Morningstar's coverage universe trades at only a 2% premium to its fair value estimate (as of


10



December 31, 2013

Portfolio Commentary, continued

December 27, 2013). That is a bottom-up measure based on Morningstar stock analysts' assessment of the potential of the companies they cover to generate future cash flows. While price/earnings multiples are above average compared to the very long term, they are close to average over the past 25 years. While we may experience volatility as some investors take profits and some stock prices adjust to lower rates of earnings growth, we expect to remain modestly overweight equities in the Portfolios because we expect stocks to rise and bonds to be vulnerable to rising rates in 2014. We also believe the measured withdrawal of monetary stimulus this year could lead investors away from more risky fare and set the stage for higher quality stocks to outperform. This could benefit the ESG Managers Portfolios because so many of our equity managers emphasize company quality in their investment processes, along with ESG factors. On the fixed-income side, we are positioned to guard against rising interest rates that we expect to occur with continued economic growth and Fed tapering. Our duration is about 4.7 years, shorter than that of the Barclays U.S. Aggregate Index (5.6 years). We are underweight rate sensitive U.S. Treasuries relative to the index and, as noted above, do not have exposure to inflation protected bonds. We are overweight our most flexible manager, PIMCO Income.

In closing, we'd like to take this opportunity to thank you for your confidence in the ESG Managers Portfolios. We believe they are attractive options for investors wanting a diversified portfolio of underlying managers who believe sustainable investing helps lead them to high-quality, lower-risk companies that will perform well over the long term while respecting the environment and the concerns of other stakeholders.

1Quantitative easing is monetary policy used by central banks to stimulate a national economy. Typically, central banks implement quantitative easing by buying financial assets from commercial banks and other private institutions, injecting a pre-determined quantity of money into the economy.

2Standard & Poor's 500 Composite Stock Index is an unmanaged index of large capitalization common stocks.

3MSCI EAFE (Europe, Australasia, Far East) Index is a free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. and Canada. The MSCI EAFE Index consists of the following 21 developed market country indices: Australia, Austria, Belgium, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, and the United Kingdom. Performance for the MSCI EAFE Index is shown "net," which includes dividend reinvestments after deduction of foreign withholding tax.

4MSCI Emerging Markets Index is an unmanaged index of stocks considered to be representative of stocks of developing countries.


11



December 31, 2013

Portfolio Commentary, continued

5Barclays U.S. Aggregate Bond Index represents securities that are U.S. domestic, taxable and dollar denominated. The index covers the U.S. investment grade fixed rate bond market, with index components for government and corporate securities and asset-backed securities.

6Barclays U.S. Corporate High Yield Index is an unmanaged index that covers the universe of fixed rate, non-investment grade, Debt.

7Blended Benchmarks

The Blended Benchmark for the Growth and Income Portfolio is comprised of 55% S&P 500 Index, 25% MSCI EAFE (Net) Index, and 20% Barclays U.S. Aggregate.

The Blended Benchmark for the Balanced Portfolio is comprised of 42% S&P 500 Index, 18% MSCI EAFE (Net) Index and 40% Barclays Aggregate U.S. Bond Index.

The Blended Benchmark for the Income Portfolio is comprised of 24% S&P 500 Index, 11% MSCI EAFE (Net) Index and 65% Barclays U.S. Aggregate Bond Index.

The Blended Benchmark for the Growth Portfolio is comprised of 66% S&P 500 Index and 34% MSCI EAFE (Net) Index.

8Barclays U.S. Treasury Inflation Protected Securities Index includes all publicly issued, U.S. Treasury inflation-protected securities (TIPS) that have at least one year remaining to maturity, are rated investment grade, and have $250 million or more of outstanding face value

9Russell 2000 Index is an unmanaged index considered representative of small-cap stocks.

10Alpha is a coefficient measuring risk-adjusted performance, considering the risk due to the specific security, rather than the overall market.

Securities of small and medium-sized companies may have less liquidity and more volatile prices than securities of larger companies, which can make it difficult for the Fund to sell such securities at desired times or prices.

The portfolio commentary in this report provides insight in an effort to help you examine your fund. The views expressed therein are those of the portfolio construction advisers and are for the period covered by this report. Such commentary does not necessarily represent the views of the Board of Trustees of your fund. The views expressed herein are subject to change at any time based upon market and/or other conditions and Pax World Management LLC and the funds disclaim any responsibility to update such views. The commentaries should not be relied upon as investment advice.


12



December 31, 2013

Growth Portfolio

Portfolio Highlights (Unaudited)

Total Return—Historical Growth of $10,000—Since Inception

Returns—Period ended December 31, 2013

       

Total Return

 

Average Annual Returns

 

Share class

  Ticker
Symbol
     

1 Year

 

3 Years

  Since
Inception1
 
Class A2, 3   

PAGAX

 

NAV4

   

28.84

%

   

10.92

%

   

10.71

%

 
       

POP

   

21.75

%

   

8.86

%

   

9.16

%

 
Institutional Class2   

PAGIX

 

   

28.98

%

   

11.18

%

   

11.00

%

 
Class C2, 5   

PAGCX

 

NAV4

   

27.84

%

   

10.11

%

   

9.90

%

 
       

CDSC

   

26.56

%

   

N/A

     

N/A

   

Blended Index6, 7, 8, 10

     

   

29.15

%

   

13.49

%

   

12.84

%

 

Lipper Multi-Cap Core Funds Index9, 10

     

   

32.58

%

   

14.39

%

   

14.53

%

 

S&P 500 Index7, 10

     

   

32.39

%

   

16.18

%

   

15.47

%

 

1The Fund's inception date is January 4, 2010.

2Total return figures include reinvested dividends and capital gains distributions, and changes in principal value, and do not reflect the taxes that a shareholder might pay on Fund distributions or on the redemption of Fund shares. These figures represent past performance, which is no guarantee of future results. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance shown. For more recent month-end performance data, please visit www.esgmanagers.com.

3A 1.00% CDSC (contingent deferred sales charge) may be charged on any shares purchased without an initial sales charge as part of a purchase over $1 million that are sold within 18 months of purchase. POP (public offering price) reflects the maximum sales load for the Fund's Class A shares of 5.50%. NAV


13



December 31, 2013

Growth Portfolio, continued

Portfolio Highlights (Unaudited), continued

performance does not reflect the deduction of the sales load or the CDSC, which if reflected would reduce the performance shown.

4NAV is Net Asset Value.

5A 1.00% CDSC (contingent deferred sales charge) may be charged on shares redeemed within one year of purchase. NAV performance does not reflect the deduction of the sales load or the CDSC, which if reflected would reduce the performance shown.

6The Blended Index is composed of 66% S&P 500 Index and 34% MSCI EAFE (Net) Index.

7The S&P 500 Index is an index of large capitalization common stocks.

8The MSCI EAFE (Europe, Australasia, Far East) Index is a free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. and Canada. The MSCI EAFE Index consisted of the following 21 developed market country indices: Australia, Austria, Belgium, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, and the United Kingdom. Performance for the MSCI EAFE Index is shown "net", which includes dividend reinvestments after deduction of foreign withholding tax.

9The Lipper Multi-Cap Core Funds Index tracks the results of the 30 largest mutual funds in the Lipper Multi-Cap Core Funds Average. The Lipper Multi-Cap Core Funds Average is a total return performance average of the mutual funds tracked by Lipper, Inc. that, by portfolio practice, invest at least 75% of their equity assets in any one market capitalization range over an extended period of time. Multi-Cap Core Funds typically have an average price-to-earnings ratio, price-to-book ratio, and three-year sales-per-share growth value, compared to the S&P SuperComposite 1500 Index. The Lipper Multi-Cap Core Funds Index is not what is typically considered to be an "index" because it tracks the performance of other mutual funds rather than the changes in the value of a group of securities, a securities index or some other traditional economic indicator.

10Unlike the Growth Portfolio, the Blended Index, the Lipper Multi-Cap Core Funds Index and the S&P 500 Index are not investments, are not professionally managed, have no policy of sustainable investing and (with the exception of the Lipper Multi-Cap Core Funds Index) do not reflect deductions for fees, expenses or taxes. Investors cannot invest directly in any index.


14



December 31, 2013

Manager Allocations

Manager/Strategy

 

Percent of Net Assets

 

EQUITY

 

Large-Cap Multi-Cap

 

ClearBridge ESG Large Cap Value

   

18.1

%

 

Touchstone Premium Yield Equity Fund

   

2.5

%

 

Parnassus Equity Income Fund

   

20.7

%

 

Neuberger Berman Socially Responsive Fund

   

23.0

%

 

Small/Mid-Cap

 

Ariel Fund

   

6.3

%

 

Pax World Small Cap Fund

   

6.6

%

 

International/World

 

Pax World International Fund

   

2.3

%

 

Pax MSCI EAFE ESG Index ETF

   

9.1

%

 

Portfolio 21 Global Equity Fund

   

3.3

%

 

Schroder Emerging Markets Equity Fund

   

5.7

%

 

Sector Specific

 

Pax World Global Environmental Markets Fund

   

2.2

%

 

Total Equities

    98.8

%

 

Other

   

0.2

%

 

Total

   

100.0

%

 

*Rounds to less that 0.1%

Top Ten Holdings

Company

 

Percent of Net Assets

 

Neuberger Berman Socially Responsive Fund

   

23.0

%

 

Parnassus Equity Income Fund

   

20.7

%

 

Pax MSCI EAFE ESG Index ETF

   

9.1

%

 

Pax World Small Cap Fund

   

6.6

%

 

Ariel Fund

   

6.3

%

 

Schroder Emerging Markets Equity Fund

   

5.7

%

 

Portfolio 21 Global Equity Fund

   

3.3

%

 

Touchstone Premium Yield Equity Fund

   

2.5

%

 

Pax World International Fund

   

2.3

%

 

Pax World Global Environmental Markets Fund

   

2.2

%

 

Total

   

81.7

%

 

Holdings are subject to change.


15



December 31, 2013

Growth and Income Portfolio

Portfolio Highlights (Unaudited)

Total Return—Historical Growth of $10,000—Since Inception

Returns—Period ended December 31, 2013

       

Total Return

 

Average Annual Returns

 

Share class

  Ticker
Symbol
     

1 Year

 

3 Years

  Since
Inception1
 
Class A2, 3   

PGPAX

 

NAV4

   

23.86

%

   

10.21

%

   

10.14

%

 
       

POP

   

17.03

%

   

8.15

%

   

8.59

%

 
Institutional Class2   

PMIIX

 

   

24.32

%

   

10.53

%

   

10.41

%

 
Class C2, 5   

PWCCX

 

NAV4

   

22.94

%

   

9.36

%

   

9.28

%

 
       

CDSC

   

21.71

%

   

N/A

     

N/A

   

Blended Index6, 7, 8, 9, 11

     

   

22.52

%

   

11.71

%

   

11.42

%

 
Lipper Mixed-Asset Target Allocation
Growth Funds Index10, 11
     

   

20.33

%

   

10.81

%

   

10.91

%

 

S&P 500 Index7, 11

     

   

32.39

%

   

16.18

%

   

15.47

%

 

1The Fund's inception date is January 4, 2010.

2Total return figures include reinvested dividends and capital gains distributions, and changes in principal value, and do not reflect the taxes that a shareholder might pay on Fund distributions or on the redemption of Fund shares. These figures represent past performance, which is no guarantee of future results. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance shown. For more recent month-end performance data, please visit www.esgmanagers.com.

3A 1.00% CDSC (contingent deferred sales charge) may be charged on any shares purchased without an initial sales charge as part of a purchase over $1 million that are sold within 18 months of purchase. POP


16



December 31, 2013

(public offering price) reflects the maximum sales load for the Fund's Class A shares of 5.50%. NAV performance does not reflect the deduction of the sales load or the CDSC, which if reflected would reduce the performance shown.

4NAV is Net Asset Value.

5A 1.00% CDSC (contingent deferred sales charge) may be charged on shares redeemed within one year of purchase. NAV performance does not reflect the deduction of the sales load or the CDSC, which if reflected would reduce the performance shown.

6The Blended Index is composed of 55% S&P 500 Index, 25% MSCI EAFE (Net) Index and 20% Barclays U.S. Aggregate Bond Index.

7The S&P 500 Index is an index of large capitalization common stocks.

8The MSCI EAFE (Europe, Australasia, Far East) Index is a free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. and Canada. The MSCI EAFE Index consisted of the following 21 developed market country indices: Australia, Austria, Belgium, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, and the United Kingdom. Performance for the MSCI EAFE Index is shown "net", which includes dividend reinvestments after deduction of foreign withholding tax.

9The Barclays U.S. Aggregate Bond Index represents securities that are U.S. domestic, taxable and dollar denominated. The index covers the U.S. investment grade fixed rate bond market, with index components for government and corporate securities and asset-backed securities.

10The Lipper Mixed-Asset Target Allocation Growth Funds Index tracks the results of the 30 largest mutual funds in the Lipper Mixed-Asset Target Allocation Growth Funds Average. The Lipper Mixed-Asset Target Allocation Growth Funds Average is a total return performance average of mutual funds tracked by Lipper, Inc. whose primary objective is to conserve principal by maintaining, at all times a mix of between 60%-80% equity securities, with the remainder invested in bonds, cash, and cash equivalents. The Lipper Mixed-Asset Target Allocation Growth Funds Index is not what is typically considered to be an "index" because it tracks the performance of other mutual funds rather than changes in the value of a group of securities, a securities index or some other traditional economic indicator.

11Unlike the Growth and Income Portfolio, the Blended Index, the Lipper Mixed-Asset Target Allocation Growth Funds Index and the S&P 500 Index are not investments, are not professionally managed, have no policy of sustainable investing and (with the exception of the Lipper Mixed-Asset Target Allocation Growth Funds Index) do not reflect deductions for fees, expenses or taxes. Investors cannot invest directly in any index.


17



December 31, 2013

Growth and Income Portfolio, continued

Portfolio Highlights (Unaudited), continued

Manager Allocations

Manager/Strategy

 

Percent of Net Assets

 

EQUITY

 

Large-Cap Multi-Cap

 

ClearBridge ESG Large Cap Value

   

14.9

%

 

Touchstone Premium Yield Equity Fund

   

12.1

%

 

Parnassus Equity Income Fund

   

18.2

%

 

Neuberger Berman Socially Responsive Fund

   

15.6

%

 

Small/Mid-Cap

 

Ariel Fund

   

3.3

%

 

Pax World Small Cap Fund

   

3.6

%

 

International/World

 

Pax World International Fund

   

1.7

%

 

Pax MSCI EAFE ESG Index ETF

   

7.0

%

 

Portfolio 21 Global Equity Fund

   

2.7

%

 

Schroder Emerging Markets Equity Fund

   

4.6

%

 

Sector Specific

 

Pax World Global Environmental Markets Fund

   

1.1

%

 

Total Equities

    84.8

%

 

FIXED INCOME

 

Investment Grade

 

Access Capital Community Investment Fund

   

0.3

%

 

CRA Qualified Investment Fund

   

0.2

%

 

Praxis Intermediate Income Fund

   

2.2

%

 

TIAA-CREF Social Choice Bond Fund

   

3.0

%

 

PIMCO Income Fund

   

6.1

%

 

High Yield

 

Pax World High Yield Bond Fund

   

3.5

%

 

Total Fixed Income

    15.3

%

 

MIXED ASSET

 

Balanced

 

Pax World Balanced Fund

   

0.1

%

 

Total Mixed Asset

   

0.1

%

 

Other

   

-0.2

%

 

Total

   

100.0

%

 

*Rounds to less that 0.1%


18



December 31, 2013

Top Ten Holdings

Company

 

Percent of Net Assets

 

Parnassus Equity Income Fund

   

18.2

%

 

Neuberger Berman Socially Responsive Fund

   

15.6

%

 

Touchstone Premium Yield Equity Fund

   

12.1

%

 

Pax MSCI EAFE ESG Index ETF

   

7.0

%

 

PIMCO Income Fund

   

6.1

%

 

Schroder Emerging Markets Equity Fund

   

4.6

%

 

Pax World Small Cap Fund

   

3.6

%

 

Pax World High Yield Bond Fund

   

3.5

%

 

Ariel Fund

   

3.3

%

 

TIAA-CREF Social Choice Bond Fund

   

3.0

%

 

Total

   

77.0

%

 

Holdings are subject to change.


19



December 31, 2013

Balanced Portfolio

Portfolio Highlights (Unaudited)

Total Return—Historical Growth of $10,000—Since Inception

Returns—Period ended December 31, 2013

       

Total Return

 

Average Annual Returns

 

Share class

  Ticker
Symbol
     

1 Year

 

3 Years

  Since
Inception1
 
Class A2, 3   

PMPAX

 

NAV4

   

17.48

%

   

8.97

%

   

8.62

%

 
       

POP

   

11.05

%

   

6.92

%

   

7.10

%

 
Institutional Class2   

PWPIX

 

   

17.86

%

   

9.20

%

   

8.86

%

 
Class C2, 5   

PWPCX

 

NAV4

   

16.70

%

   

8.14

%

   

7.79

%

 
       

CDSC

   

15.53

%

   

N/A

     

N/A

   

Blended Index6, 7, 8, 9, 11

     

   

16.01

%

   

9.72

%

   

9.75

%

 
Lipper Mixed-Asset Target Allocation
Moderate Funds Index10, 11
     

   

14.77

%

   

8.78

%

   

9.20

%

 

S&P 500 Index7, 11

     

   

32.39

%

   

16.18

%

   

15.47

%

 

1The Fund's inception date is January 4, 2010.

2Total return figures include reinvested dividends and capital gains distributions, and changes in principal value, and do not reflect the taxes that a shareholder might pay on Fund distributions or on the redemption of Fund shares. These figures represent past performance, which is no guarantee of future results. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance shown. For more recent month-end performance data, please visit www.esgmanagers.com.

3A 1.00% CDSC (contingent deferred sales charge) may be charged on any shares purchased without an initial sales charge as part of a purchase over $1 million that are sold within 18 months of purchase. POP (public offering price) reflects the maximum sales load for the Fund's Class A shares of 5.50%. NAV


20



December 31, 2013

performance does not reflect the deduction of the sales load or the CDSC, which if reflected would reduce the performance shown.

4NAV is Net Asset Value.

5A 1.00% CDSC (contingent deferred sales charge) may be charged on shares redeemed within one year of purchase. NAV performance does not reflect the deduction of the sales load or the CDSC, which if reflected would reduce the performance shown.

6The Blended Index is composed of 42% S&P 500 Index, 18% MSCI EAFE (Net) Index and 40% Barclays U.S. Aggregate Bond Index.

7The S&P 500 Index is an index of large capitalization common stocks.

8The MSCI EAFE (Europe, Australasia, Far East) Index is a free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. and Canada. The MSCI EAFE Index consisted of the following 21 developed market country indices: Australia, Austria, Belgium, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, and the United Kingdom. Performance for the MSCI EAFE Index is shown "net", which includes dividend reinvestments after deduction of foreign withholding tax.

9The Barclays U.S. Aggregate Bond Index represents securities that are U.S. domestic, taxable and dollar denominated. The index covers the U.S. investment grade fixed rate bond market, with index components for government and corporate securities and asset-backed securities.

10The Lipper Mixed-Asset Target Allocation Moderate Funds Index tracks the results of the 30 largest mutual funds in the Lipper Mixed-Asset Target Allocation Moderate Funds Average. The Lipper Mixed-Asset Target Allocation Moderate Funds Average is a total return performance average of mutual funds tracked by Lipper, Inc. whose primary objective is to conserve principal by maintaining, at all times a mix of between 40%-60% equity securities, with the remainder invested in bonds, cash, and cash equivalents. The Lipper Mixed-Asset Target Allocation Moderate Funds Index is not what is typically considered to be an "index" because it tracks the performance of other mutual funds rather than changes in the value of a group of securities, a securities index or some other traditional economic indicator.

11Unlike the Balanced Portfolio, the Blended Index, the Lipper Mixed-Asset Target Allocation Moderate Funds Index and the S&P 500 Index are not investments, are not professionally managed, have no policy of sustainable investing and (with the exception of the Lipper Mixed-Asset Target Allocation Moderate Funds Index) do not reflect deductions for fees, expenses or taxes. Investors cannot invest directly in any index.


21



December 31, 2013

Balanced Portfolio, continued

Portfolio Highlights (Unaudited), continued

Manager Allocations

Manager/Strategy

 

Percent of Net Assets

 

EQUITY

 

Large-Cap Multi-Cap

 

ClearBridge ESG Large Cap Value

   

11.7

%

 

Touchstone Premium Yield Equity Fund

   

3.9

%

 

Parnassus Equity Income Fund

   

14.7

%

 

Neuberger Berman Socially Responsive Fund

   

14.3

%

 

Small/Mid-Cap

 

Ariel Fund

   

3.5

%

 

Pax World Small Cap Fund

   

3.5

%

 

International/World

 

Pax World International Fund

   

0.6

%

 

Pax MSCI EAFE ESG Index ETF

   

6.1

%

 

Portfolio 21 Global Equity Fund

   

2.6

%

 

Schroder Emerging Markets Equity Fund

   

3.1

%

 

Sector Specific

 

Pax World Global Environmental Markets Fund

   

1.8

%

 

Total Equities

    65.8

%

 

FIXED INCOME

 

Investment Grade

 

Access Capital Community Investment Fund

   

5.6

%

 

CRA Qualified Investment Fund

   

6.5

%

 

Praxis Intermediate Income Fund

   

7.5

%

 

TIAA-CREF Social Choice Bond Fund

   

6.6

%

 

PIMCO Income Fund

   

4.9

%

 

High Yield

 

Pax World High Yield Bond Fund

   

3.2

%

 

Total Fixed Income

    34.3

%

 

MIXED ASSET

 

Balanced

 

Pax World Balanced Fund

   

0.1

%

 

Total Mixed Asset

   

0.1

%

 

Other

   

-0.2

%

 

Total

   

100.0

%

 


22



December 31, 2013

Top Ten Holdings

Company

 

Percent of Net Assets

 

Parnassus Equity Income Fund

   

14.7

%

 

Neuberger Berman Socially Responsive Fund

   

14.3

%

 

Praxis Intermediate Income Fund

   

7.5

%

 

TIAA-CREF Social Choice Bond Fund

   

6.6

%

 

CRA Qualified Investment Fund

   

6.5

%

 

Pax MSCI EAFE ESG Index ETF

   

6.1

%

 

Access Capital Community Investment Fund

   

5.6

%

 

PIMCO Income Fund

   

4.9

%

 

Touchstone Premium Yield Equity

   

3.9

%

 

Ariel Fund

   

3.5

%

 

Total

   

73.6

%

 

Holdings are subject to change.


23



December 31, 2013

Income Portfolio

Portfolio Highlights (Unaudited)

Total Return—Historical Growth of $10,000—Since Inception

Returns—Period ended December 31, 2013

       

Total Return

 

Average Annual Returns

 

Share class

  Ticker
Symbol
     

1 Year

 

3 Years

  Since
Inception1
 
Class A2, 3   

PWMAX

 

NAV4

   

9.65

%

   

6.30

%

   

6.61

%

 
       

POP

   

4.75

%

   

4.67

%

   

5.39

%

 
Institutional Class2   

PWMIX

 

   

9.89

%

   

6.57

%

   

6.87

%

 
Class C2, 5   

PWMCX

 

NAV4

   

8.82

%

   

5.53

%

   

5.80

%

 
       

CDSC

   

7.74

%

   

N/A

     

N/A

   

Blended Index6, 7, 8, 9, 11

     

   

8.14

%

   

7.03

%

   

7.42

%

 
Lipper Mixed-Asset Target Allocation
Conservative Funds Index10, 11
     

   

7.08

%

   

6.14

%

   

6.89

%

 

Barclays U.S. Aggregate Bond Index9, 11

     

   

-2.02

%

   

3.26

%

   

4.05

%

 

1The Fund's inception date is January 4, 2010.

2Total return figures include reinvested dividends and capital gains distributions, and changes in principal value, and do not reflect the taxes that a shareholder might pay on Fund distributions or on the redemption of Fund shares. These figures represent past performance, which is no guarantee of future results. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance shown. For more recent month-end performance data, please visit www.esgmanagers.com.

3A 1.00% CDSC (contingent deferred sales charge) may be charged on any shares purchased without an initial sales charge as part of a purchase over $1 million that are sold within 18 months of purchase. POP (public offering price) reflects the maximum sales load for the Fund's Class A shares of 4.50%. NAV


24



December 31, 2013

performance does not reflect the deduction of the sales load or the CDSC, which if reflected would reduce the performance shown.

4NAV is Net Asset Value.

5A 1.00% CDSC (contingent deferred sales charge) may be charged on shares redeemed within one year of purchase. NAV performance does not reflect the deduction of the sales load or the CDSC, which if reflected would reduce the performance shown.

6The Blended Index is composed of 24% S&P 500 Index, 11% MSCI EAFE (Net) Index and 65% Barclays U.S. Aggregate Bond Index.

7The S&P 500 Index is an index of large capitalization common stocks.

8The MSCI EAFE (Europe, Australasia, Far East) Index is a free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. and Canada. The MSCI EAFE Index consisted of the following 21 developed market country indices: Australia, Austria, Belgium, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, and the United Kingdom. Performance for the MSCI EAFE Index is shown "net", which includes dividend reinvestments after deduction of foreign withholding tax.

9The Barclays U.S. Aggregate Bond Index represents securities that are U.S. domestic, taxable and dollar denominated. The index covers the U.S. investment grade fixed rate bond market, with index components for government and corporate securities and asset-backed securities.

10The Lipper Mixed-Asset Target Allocation Conservative Funds Index tracks the results of the 30 largest mutual funds in the Lipper Mixed-Asset Target Allocation Conservative Funds Average. The Lipper Mixed-Asset Target Allocation Conservative Funds Average is a total return performance average of mutual funds tracked by Lipper, Inc. whose primary objective is to conserve principal by maintaining, at all times a mix of between 20%-40% equity securities, with the remainder invested in bonds, cash, and cash equivalents. The Lipper Mixed-Asset Target Allocation Conservative Funds Index is not what is typically considered to be an "index" because it tracks the performance of other mutual funds rather than changes in the value of a group of securities, a securities index or some other traditional economic indicator.

11Unlike the Income Portfolio, the Blended Index, the Lipper Mixed-Asset Target Allocation Conservative Funds Index and the Barclays U.S. Aggregate Bond Index are not investments, are not professionally managed, have no policy of sustainable investing and (with the exception of the Lipper Mixed-Asset Target Allocation Conservative Funds Index) do not reflect deductions for fees, expenses or taxes. Investors cannot invest directly in any index.


25



December 31, 2013

Income Portfolio, continued

Portfolio Highlights (Unaudited), continued

Manager Allocations

Manager/Strategy

 

Percent of Net Assets

 

EQUITY

 

Large-Cap Multi-Cap

 

ClearBridge ESG Large Cap Value

   

6.3

%

 

Touchstone Premium Yield Equity Fund

   

7.0

%

 

Parnassus Equity Income Fund

   

9.7

%

 

Neuberger Berman Socially Responsive Fund

   

6.2

%

 

Small/Mid-Cap

 

Ariel Fund

   

1.2

%

 

Pax World Small Cap Fund

   

1.6

%

 

International/World

 

Pax World International Fund

   

0.1

%

 

Pax MSCI EAFE ESG Index ETF

   

2.5

%

 

Portfolio 21 Global Equity Fund

   

1.6

%

 

Schroder Emerging Markets Equity Fund

   

2.2

%

 

Sector Specific

 

Pax World Global Environmental Markets Fund

   

1.7

%

 

Total Equities

   

40.1

%

 

FIXED INCOME

 

Investment Grade

 

Access Capital Community Investment Fund

   

11.6

%

 

CRA Qualified Investment Fund

   

4.3

%

 

Praxis Intermediate Income Fund

   

16.1

%

 

TIAA-CREF Social Choice Bond Fund

   

13.0

%

 

PIMCO Income Fund

   

14.1

%

 

High Yield

 

Pax World High Yield Bond Fund

   

1.5

%

 

Total Fixed Income

    60.6

%

 

MIXED ASSET

 

Balanced

 

Pax World Balanced Fund

   

0.0

%

 

Total Mixed Asset

   

0.0

%

 

Other

   

-0.7

%

 

Total

   

100.0

%

 


26



December 31, 2013

Top Ten Holdings

Company

 

Percent of Net Assets

 

Praxis Intermediate Income Fund

   

16.1

%

 

PIMCO Income Fund

   

14.1

%

 

TIAA-CREF Social Choice Bond Fund

   

13.0

%

 

Access Capital Community Investment Fund

   

11.6

%

 

Parnassus Equity Income Fund

   

9.7

%

 

Touchstone Premium Yield Equity Fund

   

7.0

%

 

Neuberger Berman Socially Responsive Fund

   

6.2

%

 

CRA Qualified Investment Fund

   

4.3

%

 

Pax MSCI EAFE ESG Index ETF

   

2.5

%

 

Schroder Emerging Markets Equity Fund

   

2.2

%

 

Total

   

86.7

%

 

Holdings are subject to change.


27



December 31, 2013

Shareholder Expense Examples (Unaudited)

Examples As a shareholder of the ESG Managers Growth, Growth and Income, Balanced or Income Portfolios, you incur ongoing costs, including management fees; distribution and/or service (12b-1) fees; and other Fund expenses. The examples on the next page are intended to help you understand your ongoing costs (in dollars) of investing in each of the Funds and compare these costs with the ongoing costs of investing in other mutual funds. For more information, see the relevant Fund's prospectus or talk to your financial adviser.

The examples are based on an investment of $1,000 invested at the beginning of the period and held for the entire period beginning on July 1, 2013 and ending on December 31, 2013.

Please note that Individual Retirement Account (IRA), Coverdell Education Savings, Roth IRA, SEP-IRA, SIMPLE IRA, and 403(b)(7) accounts are charged an annual custodial fee of twelve dollars. If you are invested in one of these account types, you should add an additional six dollars to the estimated expenses paid during the period.

Actual Expenses For each Fund, the first table on the next page provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. For the Fund, 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 under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period.

Hypothetical Examples for Comparison Purposes For each Fund, the second table on the following page provides information about hypothetical account values and hypothetical expenses based on each Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not each 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 the Funds and other funds. To do so, compare these 5% hypothetical examples with the 5% hypothetical examples that appear in the shareholder reports of the other funds.


28



December 31, 2013

Shareholder Expense Examples (Unaudited), continued

Please note that the expenses shown in the tables are meant to highlight your ongoing costs only and do not reflect any transactional costs or expenses of underlying fund investments. Therefore, the second 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 and underlying fund expenses were included, your costs would have been higher.

Based on Actual Fund Return

  Beginning
Account Value
(7/1/13)
  Ending
Account Value
(12/31/13)
  Annualized
Expense
Ratio
  Expenses Paid
During Period1
 

Growth - Class A

 

$

1,000.00

   

$

1,155.00

     

1.26

%

 

$

6.84

   

Growth - Institutional

   

1,000.00

     

1,154.40

     

1.01

%

   

5.48

   

Growth - Class C

   

1,000.00

     

1,150.20

     

2.01

%

   

10.89

   

Growth and Income - Class A

   

1,000.00

     

1,129.60

     

1.12

%

   

6.01

   

Growth and Income - Institutional

   

1,000.00

     

1,132.60

     

0.87

%

   

4.68

   

Growth and Income - Class C

   

1,000.00

     

1,124.80

     

1.87

%

   

10.02

   

Balanced - Class A

   

1,000.00

     

1,099.40

     

1.08

%

   

5.71

   

Balanced - Institutional

   

1,000.00

     

1,100.90

     

0.83

%

   

4.40

   

Balanced - Class C

   

1,000.00

     

1,096.00

     

1.83

%

   

9.67

   

Income - Class A

   

1,000.00

     

1,059.00

     

0.99

%

   

5.14

   

Income - Institutional

   

1,000.00

     

1,061.10

     

0.74

%

   

3.84

   

Income - Class C

   

1,000.00

     

1,055.30

     

1.74

%

   

9.01

   
Based on Hypothetical 5% Return
(before expenses)
  Beginning
Account Value
(7/1/13)
  Ending
Account Value
(12/31/13)
  Annualized
Expense
Ratio
  Expenses Paid
During Period1
 

Growth - Class A

 

$

1,000.00

   

$

1,018.85

     

1.26

%

 

$

6.41

   

Growth - Institutional

   

1,000.00

     

1,020.11

     

1.01

%

   

5.14

   

Growth - Class C

   

1,000.00

     

1,015.07

     

2.01

%

   

10.21

   

Growth and Income - Class A

   

1,000.00

     

1,019.56

     

1.12

%

   

5.70

   

Growth and Income - Institutional

   

1,000.00

     

1,020.82

     

0.87

%

   

4.43

   

Growth and Income - Class C

   

1,000.00

     

1,015.78

     

1.87

%

   

9.50

   

Balanced - Class A

   

1,000.00

     

1,019.76

     

1.08

%

   

5.50

   

Balanced - Institutional

   

1,000.00

     

1,021.02

     

0.83

%

   

4.23

   

Balanced - Class C

   

1,000.00

     

1,015.98

     

1.83

%

   

9.30

   

Income - Class A

   

1,000.00

     

1,020.21

     

0.99

%

   

5.04

   

Income - Institutional

   

1,000.00

     

1,021.48

     

0.74

%

   

3.77

   

Income - Class C

   

1,000.00

     

1,016.43

     

1.74

%

   

8.84

   

1Expenses are equal to each Funds' annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period beginning on July 1, 2013 and ending on December 31, 2013).


29




December 31, 2013

Schedule of Investments

Growth Portfolio

Percent of Net Assets
Name of Issuer and
Title of Issuer
  Shares/
Principal/
Contracts
 

Value

 

COMMON STOCKS: 18.1%

 

Consumer Discretionary: 3.0%

 

DISH Network Corp., Class A (a)

   

1,731

   

$

100,260

   

Home Depot, Inc.

   

622

     

51,215

   

McDonald's Corp.

   

200

     

19,406

   

SES SA

   

907

     

29,384

   

Target Corp.

   

403

     

25,498

   

Time Warner Cable, Inc.

   

492

     

66,666

   

Time Warner, Inc.

   

1,102

     

76,831

   
Twenty-First Century Fox, Inc.,
Class A
   

783

     

27,546

   
Twenty-First Century Fox, Inc.,
Class B
   

1,377

     

47,644

   
     

444,450

   

Consumer Staples: 2.0%

 

Coca-Cola Co., The

   

966

     

39,905

   

CVS Caremark Corp.

   

1,240

     

88,747

   

Kellogg Co.

   

693

     

42,322

   

Kimberly-Clark Corp.

   

426

     

44,500

   

PepsiCo, Inc.

   

671

     

55,653

   

Sysco Corp.

   

725

     

26,173

   
     

297,300

   

Energy: 1.9%

 

Cameron International Corp. (a)

   

485

     

28,872

   

ConocoPhillips

   

876

     

61,889

   

National Oilwell Varco, Inc.

   

339

     

26,961

   

Noble Corp PLC

   

937

     

35,109

   

Royal Dutch Shell PLC, ADR

   

849

     

60,508

   

Schlumberger, Ltd.

   

513

     

46,226

   

Suncor Energy, Inc.

   

809

     

28,356

   
     

287,921

   

Financials: 4.9%

 

American Express Co.

   

743

     

67,412

   

American Tower Corp., REIT

   

465

     

37,116

   

Bank of New York Mellon Corp., The

   

879

     

30,712

   

Capital One Financial Corp.

   

457

     

35,011

   

Citigroup, Inc.

   

566

     

29,494

   

JPMorgan Chase & Co.

   

1,820

     

106,434

   

Loews Corp.

   

654

     

31,549

   

Marsh & McLennan Cos., Inc.

   

1,021

     

49,376

   

MetLife, Inc.

   

671

     

36,180

   

Progressive Corp., The

   

671

     

18,298

   

State Street Corp.

   

971

     

71,262

   

Travelers Cos., Inc., The

   

555

     

50,250

   

US Bancorp

   

2,018

     

81,527

   

Wells Fargo & Co.

   

2,190

     

99,426

   
     

744,047

   
Percent of Net Assets
Name of Issuer and
Title of Issuer
  Shares/
Principal/
Contracts
 

Value

 

COMMON STOCKS, continued

 

Health Care: 1.4%

 

Johnson & Johnson

   

501

   

$

45,887

   

Merck & Co., Inc.

   

1,010

     

50,550

   

Novartis AG, ADR

   

368

     

29,580

   

Pfizer, Inc.

   

1,035

     

31,702

   
Teva Pharmaceutical
Industries, Ltd., ADR
   

646

     

25,892

   

WellPoint, Inc.

   

369

     

34,092

   
     

217,703

   

Industrials: 2.2%

 

Danaher Corp.

   

832

     

64,230

   

Emerson Electric Co.

   

746

     

52,354

   

General Electric Co.

   

2,975

     

83,389

   

Honeywell International, Inc.

   

770

     

70,355

   

Illinois Tool Works, Inc.

   

663

     

55,745

   
     

326,073

   

Information Technology: 1.3%

 

IBM

   

188

     

35,263

   

Microsoft Corp.

   

948

     

35,484

   

Motorola Solutions, Inc.

   

626

     

42,255

   

TE Connectivity, Ltd.

   

866

     

47,725

   

Xerox Corp

   

3,104

     

37,776

   
     

198,503

   

Materials: 0.5%

 

Air Products & Chemicals, Inc.

   

290

     

32,416

   

Crown Holdings, Inc. (a)

   

1,068

     

47,601

   
     

80,017

   

Telecommunication Services: 0.6%

 

AT&T, Inc.

   

671

     

23,592

   

Verizon Communications, Inc.

   

468

     

22,998

   

Vodafone Group PLC, ADR

   

1,217

     

47,840

   
     

94,430

   

Utilities: 0.3%

 

Sempra Energy

   

505

     

45,329

   

TOTAL COMMON STOCKS

 

(Cost $1,939,802)

       

2,735,773

   

AFFILIATED INVESTMENT COMPANIES: 20.2%

 

Pax MSCI EAFE ESG Index ETF

   

45,870

     

1,371,972

   
Pax World Global Environmental
Markets Fund (b)
   

25,444

     

327,203

   

Pax World International Fund (b)

   

36,737

     

344,596

   

Pax World Small Cap Fund (b)

   

72,993

     

996,357

   

TOTAL AFFILIATED INVESTMENT COMPANIES

 

(Cost $2,592,776)

       

3,040,128

   

SEE NOTES TO FINANCIAL STATEMENTS
30



December 31, 2013

Schedule of Investments, continued

Growth Portfolio, continued

Percent of Net Assets
Name of Issuer and
Title of Issuer
  Shares/
Principal/
Contracts
 

Value

 

NON-AFFILIATED INVESTMENT COMPANIES: 61.5%

 

Ariel Fund (b)

   

13,005

   

$

957,933

   
Neuberger Berman Socially
Responsive Fund (b)
   

99,649

     

3,477,742

   

Parnassus Equity Income Fund (b)

   

85,122

     

3,126,546

   

Portfolio 21 Global Equity Fund (b)

   

12,253

     

499,311

   
Schroder Emerging Markets
Equity Fund (c)
   

64,082

     

854,214

   
Touchstone Premium Yield
Equity Fund (d)
   

40,076

     

373,940

   

TOTAL NON-AFFILIATED INVESTMENT COMPANIES

 

(Cost $8,983,089)

 

   

9,289,686

   

TOTAL INVESTMENTS: 99.8%

 

(Cost $13,515,667)

 

   

15,065,587

   

OTHER ASSETS AND LIABILITIES—

 

(Net): 0.2%

 

   

35,170

   

Net Assets: 100.0%

     

$

15,100,757

   

(a)  Non income producing security.

(b)  Institutional Class shares

(c)  Investor Class shares

(d)  Class Y shares

ADR  American Depository Receipt

REIT  Real Estate Investment Trust

 

 

 

SEE NOTES TO FINANCIAL STATEMENTS
31



December 31, 2013

Schedule of Investments

Growth and Income Portfolio

Percent of Net Assets
Name of Issuer and
Title of Issuer
  Shares/
Principal/
Contracts
 

Value

 

COMMON STOCKS: 14.9%

 

Consumer Discretionary: 2.4%

 

DISH Network Corp., Class A (a)

   

1,013

   

$

58,673

   

Home Depot, Inc.

   

382

     

31,454

   

McDonald's Corp.

   

115

     

11,158

   

SES SA

   

524

     

16,976

   

Target Corp.

   

236

     

14,932

   

Time Warner Cable, Inc.

   

291

     

39,431

   

Time Warner, Inc.

   

666

     

46,434

   
Twenty First Century Fox, Inc.,
Class B
   

792

     

27,402

   
Twenty-First Century Fox, Inc.,
Class A
   

419

     

14,740

   
     

261,200

   

Consumer Staples: 1.6%

 

CVS Caremark Corp.

   

764

     

54,679

   

Coca-Cola Co., The

   

592

     

24,456

   

Kellogg Co.

   

416

     

25,405

   

Kimberly-Clark Corp.

   

261

     

27,264

   

PepsiCo, Inc.

   

419

     

34,752

   

Sysco Corp.

   

427

     

15,415

   
     

181,971

   

Energy: 1.6%

 

Cameron International Corp. (a)

   

294

     

17,502

   

ConocoPhillips

   

537

     

37,939

   

National Oilwell Varco, Inc.

   

207

     

16,463

   

Noble Corp PLC

   

574

     

21,508

   

Royal Dutch Shell PLC, ADR

   

515

     

36,704

   

Schlumberger, Ltd.

   

311

     

28,024

   

Suncor Energy, Inc.

   

485

     

16,998

   
     

175,138

   

Financials: 4.0%

 

American Express Co.

   

452

     

41,010

   

American Tower Corp., REIT

   

272

     

21,711

   

Bank of New York Mellon Corp., The

   

546

     

19,077

   

Capital One Financial Corp.

   

285

     

21,834

   

Citigroup, Inc.

   

315

     

16,415

   

JPMorgan Chase & Co.

   

1,106

     

64,679

   

Loews Corp.

   

403

     

19,441

   

Marsh & McLennan Cos., Inc.

   

616

     

29,790

   

MetLife, Inc.

   

405

     

21,838

   

Progressive Corp., The

   

413

     

11,263

   

State Street Corp.

   

577

     

42,346

   

Travelers Cos., Inc., The

   

343

     

31,055

   

US Bancorp

   

1,203

     

48,601

   

Wells Fargo & Co.

   

1,338

     

60,744

   
     

449,804

   
Percent of Net Assets
Name of Issuer and
Title of Issuer
  Shares/
Principal/
Contracts
 

Value

 

COMMON STOCKS, continued

 

Health Care: 1.2%

 

Johnson & Johnson

   

309

   

$

28,301

   

Merck & Co., Inc.

   

610

     

30,531

   

Novartis AG, ADR

   

222

     

17,844

   

Pfizer, Inc.

   

617

     

18,899

   
Teva Pharmaceutical
Industries, Ltd., ADR
   

401

     

16,072

   

WellPoint, Inc.

   

226

     

20,880

   
     

132,527

   

Industrials: 1.8%

 

Danaher Corp.

   

490

     

37,828

   

Emerson Electric Co.

   

453

     

31,792

   

General Electric Co.

   

1,804

     

50,566

   

Honeywell International, Inc.

   

456

     

41,665

   

Illinois Tool Works, Inc.

   

403

     

33,884

   
     

195,735

   

Information Technology: 1.1%

 

IBM

   

114

     

21,383

   

Microsoft Corp.

   

595

     

22,271

   

Motorola Solutions, Inc.

   

384

     

25,920

   

TE Connectivity, Ltd.

   

526

     

28,988

   

Xerox Corp

   

1,871

     

22,770

   
     

121,332

   

Materials: 0.4%

 

Air Products & Chemicals, Inc.

   

178

     

19,897

   

Crown Holdings, Inc. (a)

   

649

     

28,926

   
     

48,823

   

Telecommunication Services: 0.5%

 

AT&T, Inc.

   

422

     

14,838

   

Verizon Communications, Inc.

   

285

     

14,005

   

Vodafone Group PLC, ADR

   

711

     

27,949

   
     

56,792

   

Utilities: 0.3%

 

Sempra Energy

   

312

     

28,005

   

TOTAL COMMON STOCKS

 

(Cost $1,088,433)

       

1,651,327

   

AFFILIATED INVESTMENT COMPANIES: 17.1%

 

Pax MSCI EAFE ESG Index ETF

   

26,258

     

785,376

   

Pax World Balanced Fund (b)

   

237

     

5,857

   
Pax World Global Environmental
Markets Fund (b)
   

10,549

     

135,658

   

Pax World High Yield Bond Fund (b)

   

51,305

     

386,842

   

Pax World International Fund (b)

   

20,344

     

190,828

   

Pax World Small Cap Fund (b)

   

29,668

     

404,962

   

TOTAL AFFILIATED INVESTMENT COMPANIES

 

(Cost $1,654,406)

       

1,909,523

   

SEE NOTES TO FINANCIAL STATEMENTS
32



December 31, 2013

Schedule of Investments, continued

Growth and Income Portfolio, continued

Percent of Net Assets
Name of Issuer and
Title of Issuer
  Shares/
Principal/
Contracts
 

Value

 

NON-AFFILIATED INVESTMENT COMPANIES: 68.2%

 
Access Capital Community
Investment Fund (b)
   

3,088

   

$

28,289

   

Ariel Fund (b)

   

4,999

     

368,253

   

CRA Qualified Investment Fund (b)

   

1,889

     

19,833

   
Neuberger Berman Socially
Responsive Fund (b)
   

50,141

     

1,749,902

   

Parnassus Equity Income Fund (b)

   

55,320

     

2,031,916

   

PIMCO Income Fund (b)

   

55,238

     

677,214

   
Praxis Intermediate
Income Fund (b)
   

23,767

     

243,133

   

Portfolio 21 Global Equity Fund (b)

   

7,348

     

299,436

   
Schroder Emerging Markets
Equity Fund (c)
   

38,094

     

507,799

   
TIAA-CREF Social Choice
Bond Fund (b)
   

34,197

     

333,763

   
Touchstone Premium Yield
Equity Fund (d)
   

144,201

     

1,345,398

   

TOTAL NON-AFFILIATED INVESTMENT COMPANIES

 

(Cost $7,416,456)

 

   

7,604,936

   

TOTAL INVESTMENTS: 100.2%

 

(Cost $10,159,295)

 

   

11,165,786

   

OTHER ASSETS AND LIABILITIES—

 

(Net): -0.2%

       

(17,932

)

 

Net Assets: 100.0%

     

$

11,147,854

   

(a)  Non income producing security.

(b)  Institutional Class shares

(c)  Investor Class shares

(d)  Class Y shares

ADR  American Depository Receipt

REIT  Real Estate Investment Trust

 

 

 

SEE NOTES TO FINANCIAL STATEMENTS
33



December 31, 2013

Schedule of Investments

Balanced Portfolio

Percent of Net Assets
Name of Issuer and
Title of Issuer
  Shares/
Principal/
Contracts
 

Value

 

COMMON STOCKS: 11.7%

 

Consumer Discretionary: 1.9%

 

DISH Network Corp., Class A (a)

   

1,121

   

$

64,928

   

Home Depot, Inc.

   

388

     

31,948

   

McDonald's Corp.

   

132

     

12,808

   

SES SA

   

614

     

19,891

   

Target Corp.

   

252

     

15,944

   

Time Warner Cable, Inc.

   

313

     

42,412

   

Time Warner, Inc.

   

701

     

48,874

   
Twenty First Century Fox, Inc.,
Class B
   

887

     

30,690

   
Twenty-First Century Fox, Inc.,
Class A
   

439

     

15,444

   
     

282,939

   

Consumer Staples: 1.3%

 

CVS Caremark Corp.

   

800

     

57,256

   

Coca-Cola Co., The

   

622

     

25,695

   

Kellogg Co.

   

446

     

27,237

   

Kimberly-Clark Corp.

   

276

     

28,831

   

PepsiCo, Inc.

   

444

     

36,825

   

Sysco Corp.

   

446

     

16,101

   
     

191,945

   

Energy: 1.2%

 

Cameron International Corp. (a)

   

315

     

18,752

   

ConocoPhillips

   

562

     

39,705

   

National Oilwell Varco, Inc.

   

214

     

17,019

   

Noble Corp PLC

   

602

     

22,557

   

Royal Dutch Shell PLC, ADR

   

548

     

39,057

   

Schlumberger, Ltd.

   

321

     

28,925

   

Suncor Energy, Inc.

   

521

     

18,261

   
     

184,276

   

Financials: 3.2%

 

American Express Co.

   

467

     

42,371

   

American Tower Corp., REIT

   

303

     

24,185

   

Bank of New York Mellon Corp., The

   

563

     

19,671

   

Capital One Financial Corp.

   

297

     

22,753

   

Citigroup, Inc.

   

345

     

17,978

   

JPMorgan Chase & Co.

   

1,154

     

67,486

   

Loews Corp.

   

430

     

20,743

   

Marsh & McLennan Cos., Inc.

   

646

     

31,241

   

MetLife, Inc.

   

426

     

22,970

   

Progressive Corp., The

   

422

     

11,508

   

State Street Corp.

   

603

     

44,254

   

Travelers Cos., Inc., The

   

352

     

31,870

   

US Bancorp

   

1,314

     

53,086

   

Wells Fargo & Co.

   

1,402

     

63,651

   
     

473,767

   
Percent of Net Assets
Name of Issuer and
Title of Issuer
  Shares/
Principal/
Contracts
 

Value

 

COMMON STOCKS, continued

 

Health Care: 1.0%

 

Johnson & Johnson

   

318

   

$

29,126

   

Merck & Co., Inc.

   

643

     

32,182

   

Novartis AG, ADR

   

214

     

17,201

   

Pfizer, Inc.

   

638

     

19,542

   
Teva Pharmaceutical
Industries, Ltd., ADR
   

430

     

17,234

   

WellPoint, Inc.

   

240

     

22,175

   
     

137,460

   

Industrials: 1.4%

 

Danaher Corp.

   

535

     

41,302

   

Emerson Electric Co.

   

491

     

34,458

   

General Electric Co.

   

1,908

     

53,482

   

Honeywell International, Inc.

   

503

     

45,960

   

Illinois Tool Works, Inc.

   

427

     

35,902

   
     

211,104

   

Information Technology: 0.8%

 

IBM

   

120

     

22,507

   

Microsoft Corp.

   

602

     

22,532

   

Motorola Solutions, Inc.

   

396

     

26,729

   

TE Connectivity, Ltd.

   

548

     

30,200

   

Xerox Corp

   

1,967

     

23,938

   
     

125,906

   

Materials: 0.4%

 

Air Products & Chemicals, Inc.

   

190

     

21,239

   

Crown Holdings, Inc. (a)

   

689

     

30,710

   
     

51,949

   

Telecommunication Services: 0.4%

 

AT&T, Inc.

   

444

     

15,611

   

Verizon Communications, Inc.

   

298

     

14,644

   

Vodafone Group PLC, ADR

   

786

     

30,898

   
     

61,153

   

Utilities: 0.2%

 

Sempra Energy

   

325

     

29,172

   

TOTAL COMMON STOCKS

 

(Cost $1,160,504)

       

1,749,671

   

AFFILIATED INVESTMENT COMPANIES: 15.2%

 

Pax MSCI EAFE ESG Index ETF

   

30,395

     

909,114

   

Pax World Balanced Fund

   

330

     

8,162

   
Pax World Global Environmental
Markets Fund
   

20,241

     

260,297

   

Pax World High Yield Bond Fund

   

62,738

     

473,048

   

Pax World International Fund

   

8,664

     

81,270

   

Pax World Small Cap Fund

   

37,845

     

516,588

   

TOTAL AFFILIATED INVESTMENT COMPANIES

 

(Cost $1,933,206)

       

2,248,479

   

SEE NOTES TO FINANCIAL STATEMENTS
34



December 31, 2013

Schedule of Investments, continued

Balanced Portfolio, continued

Percent of Net Assets
Name of Issuer and
Title of Issuer
  Shares/
Principal/
Contracts
 

Value

 

NON-AFFILIATED INVESTMENT COMPANIES: 73.3%

 
Access Capital Community
Investment Fund (b)
   

89,916

   

$

823,627

   

Ariel Fund (b)

   

7,048

     

519,146

   

CRA Qualified Investment Fund (b)

   

91,957

     

965,546

   
Neuberger Berman Socially
Responsive Fund (b)
   

61,043

     

2,130,388

   

Parnassus Equity Income Fund (b)

   

59,532

     

2,186,600

   

PIMCO Income Fund (b)

   

59,311

     

727,152

   
Praxis Intermediate
Income Fund (b)
   

109,278

     

1,117,916

   

Portfolio 21 Global Equity Fund (b)

   

9,626

     

392,240

   
Schroder Emerging Markets
Equity Fund (c)
   

34,634

     

461,671

   
TIAA-CREF Social Choice
Bond Fund (b)
   

100,209

     

978,038

   
Touchstone Premium Yield
Equity Fund (d)
   

62,128

     

579,654

   

TOTAL NON-AFFILIATED INVESTMENT COMPANIES

 

(Cost $10,809,642)

 

   

10,881,978

   

TOTAL INVESTMENTS: 100.2%

 

(Cost $13,903,352)

 

   

14,880,128

   

OTHER ASSETS AND LIABILITIES—

 

(Net): -0.2%

       

(36,280

)

 

Net Assets: 100.0%

     

$

14,843,848

   

(a)  Non income producing security.

(b)  Institutional Class share

(c)  Investor Class shares

(d)  Class Y shares

ADR  American Depository Receipt

REIT  Real Estate Investment Trust

 

 

 

SEE NOTES TO FINANCIAL STATEMENTS
35



December 31, 2013

Schedule of Investments

Income Portfolio

Percent of Net Assets
Name of Issuer and
Title of Issuer
  Shares/
Principal/
Contracts
 

Value

 

COMMON STOCKS: 6.2%

 

Consumer Discretionary: 1.0%

 

DISH Network Corp., Class A (a)

   

264

   

$

15,291

   

Home Depot, Inc.

   

90

     

7,411

   

McDonald's Corp.

   

29

     

2,814

   

SES SA

   

136

     

4,406

   

Target Corp.

   

57

     

3,606

   

Time Warner Cable, Inc.

   

69

     

9,350

   

Time Warner, Inc.

   

160

     

11,155

   
Twenty First Century Fox, Inc.,
Class B
   

253

     

8,754

   
Twenty-First Century Fox, Inc.,
Class A
   

53

     

1,865

   
     

64,652

   

Consumer Staples: 0.7%

 

CVS Caremark Corp.

   

180

     

12,882

   

Coca-Cola Co., The

   

142

     

5,866

   

Kellogg Co.

   

98

     

5,985

   

Kimberly-Clark Corp.

   

60

     

6,268

   

PepsiCo, Inc.

   

100

     

8,294

   

Sysco Corp.

   

101

     

3,646

   
     

42,941

   

Energy: 0.7%

 

Cameron International Corp. (a)

   

71

     

4,227

   

ConocoPhillips

   

127

     

8,973

   

National Oilwell Varco, Inc.

   

48

     

3,817

   

Noble Corp PLC

   

138

     

5,171

   

Royal Dutch Shell PLC, ADR

   

124

     

8,837

   

Schlumberger, Ltd.

   

74

     

6,668

   

Suncor Energy, Inc.

   

116

     

4,066

   
     

41,759

   

Financials: 1.7%

 

American Express Co.

   

108

     

9,799

   

American Tower Corp., REIT

   

72

     

5,747

   

Bank of New York Mellon Corp., The

   

129

     

4,507

   

Capital One Financial Corp.

   

66

     

5,056

   

Citigroup, Inc.

   

82

     

4,273

   

JPMorgan Chase & Co.

   

258

     

15,088

   

Loews Corp.

   

94

     

4,535

   

Marsh & McLennan Cos., Inc.

   

145

     

7,012

   

MetLife, Inc.

   

95

     

5,122

   

Progressive Corp., The

   

97

     

2,645

   

State Street Corp.

   

136

     

9,981

   

Travelers Cos., Inc., The

   

78

     

7,062

   

US Bancorp

   

288

     

11,635

   

Wells Fargo & Co.

   

312

     

14,165

   
     

106,627

   
Percent of Net Assets
Name of Issuer and
Title of Issuer
  Shares/
Principal/
Contracts
 

Value

 

COMMON STOCKS, continued

 

Health Care: 0.5%

 

Johnson & Johnson

   

73

   

$

6,686

   

Merck & Co., Inc.

   

145

     

7,257

   

Novartis AG, ADR

   

52

     

4,180

   

Pfizer, Inc.

   

145

     

4,441

   
Teva Pharmaceutical
Industries, Ltd., ADR
   

94

     

3,768

   

WellPoint, Inc.

   

54

     

4,989

   
     

31,321

   

Industrials: 0.7%

 

Danaher Corp.

   

118

     

9,110

   

Emerson Electric Co.

   

109

     

7,650

   

General Electric Co.

   

431

     

12,080

   

Honeywell International, Inc.

   

111

     

10,142

   

Illinois Tool Works, Inc.

   

94

     

7,904

   
     

46,886

   

Information Technology: 0.4%

 

IBM

   

27

     

5,064

   

Microsoft Corp.

   

138

     

5,165

   

Motorola Solutions, Inc.

   

90

     

6,075

   

TE Connectivity, Ltd.

   

123

     

6,779

   

Xerox Corp

   

438

     

5,330

   
     

28,413

   

Materials: 0.2%

 

Air Products & Chemicals, Inc.

   

43

     

4,807

   

Crown Holdings, Inc. (a)

   

155

     

6,908

   
     

11,715

   

Telecommunication Services: 0.2%

 

AT&T, Inc.

   

99

     

3,481

   

Verizon Communications, Inc.

   

66

     

3,243

   

Vodafone Group PLC, ADR

   

186

     

7,312

   
     

14,036

   

Utilities: 0.1%

 

Sempra Energy

   

74

     

6,642

   

TOTAL COMMON STOCKS

 

(Cost $251,820)

       

394,992

   

AFFILIATED INVESTMENT COMPANIES: 7.6%

 

Pax MSCI EAFE ESG Index ETF (b)

   

5,287

     

158,134

   

Pax World Balanced Fund (b)

   

79

     

1,959

   
Pax World Global Environmental
Markets Fund (b)
   

8,606

     

110,679

   

Pax World High Yield Bond Fund (b)

   

13,209

     

99,595

   

Pax World International Fund (b)

   

1,183

     

11,100

   

Pax World Small Cap Fund (b)

   

7,406

     

101,097

   

TOTAL AFFILIATED INVESTMENT COMPANIES

 

(Cost $398,299)

       

482,564

   

SEE NOTES TO FINANCIAL STATEMENTS
36



December 31, 2013

Schedule of Investments, continued

Income Portfolio, continued

Percent of Net Assets
Name of Issuer and
Title of Issuer
  Shares/
Principal/
Contracts
 

Value

 

NON-AFFILIATED INVESTMENT COMPANIES: 86.9%

 
Access Capital Community
Investment Fund (b)
   

80,508

   

$

737,458

   

Ariel Fund (b)

   

1,007

     

74,206

   

CRA Qualified Investment Fund (b)

   

25,723

     

270,088

   
Neuberger Berman Socially
Responsive Fund (b)
   

11,298

     

394,311

   

Parnassus Equity Income Fund (b)

   

16,772

     

616,052

   

PIMCO Income Fund (b)

   

72,887

     

893,592

   
Praxis Intermediate
Income Fund (b)
   

99,645

     

1,019,363

   

Portfolio 21 Global Equity Fund (b)

   

2,527

     

102,965

   
Schroder Emerging Markets
Equity Fund (c)
   

10,266

     

136,849

   
TIAA-CREF Social Choice
Bond Fund (b)
   

84,498

     

824,699

   
Touchstone Premium Yield
Equity Fund (d)
   

47,376

     

442,016

   

TOTAL NON-AFFILIATED INVESTMENT COMPANIES

 

(Cost $5,525,101)

 

   

5,511,599

   

TOTAL INVESTMENTS: 100.7%

 

(Cost $6,175,220)

 

   

6,389,155

   

OTHER ASSETS AND LIABILITIES—

 

(Net): -0.7%

       

(43,269

)

 

Net Assets: 100.0%

     

$

6,345,886

   

(a)  Non income producing security.

(b)  Institutional Class shares

(c)  Investor Class shares

(d)  Class Y shares

ADR  American Depository Receipt

REIT  Real Estate Investment Trust

 

 

 

SEE NOTES TO FINANCIAL STATEMENTS
37




December 31, 2013

Statements of Assets and Liabilities

ASSETS

 

Growth

 

Growth and Income

 

Investments, at cost—Note A

 

$

13,515,667

   

$

10,159,295

   

Investments in unaffiliated issuers, at value—Note A

 

$

12,025,459

   

$

9,256,263

   

Investments in affiliated issuers, at value

   

3,040,128

     

1,909,523

   
Total Investments    

15,065,587

     

11,165,786

   

Foreign currency at value (cost: $5; $3; $3; and $1, respectively)

   

5

     

5

   

Prepaid Expenses

   

399

     

2,496

   

Receivables:

 
Capital stock sold    

57,652

     

26,829

   

Dividends and interest—Note B

   

13,339

     

8,115

   

Investment securities sold

   

107,591

     

45,652

   

Investment Adviser reimbursement

   

7,356

     

6,337

   

Other

   

329

     

277

   
Total Assets    

15,252,258

     

11,255,497

   

LIABILITIES

 

Payables:

 

Capital stock reacquired

   

9,882

     

1,202

   

Investment securities purchased

   

16,205

     

9,654

   

Payable to bank

   

63,271

     

35,964

   

Accrued expenses:

 

Investment advisory fees—Note B

   

7,493

     

5,075

   

Distribution expense

   

3,931

     

4,161

   

Trustees fees

   

104

     

   

Compliance expense

   

5,686

     

5,686

   

Transfer agent fees

   

3,085

     

   

Printing and other shareholder communication fees

   

48

     

131

   

Custodian fees

   

6,024

     

5,558

   

Legal and audit fees

   

23,350

     

27,926

   

Other accrued expenses

   

12,422

     

12,286

   
Total Liabilities    

151,501

     

107,643

   
NET ASSETS  

$

15,100,757

   

$

11,147,854

   

SEE NOTES TO FINANCIAL STATEMENTS
38



December 31, 2013

ASSETS

 

Balanced

 

Income

 

Investments, at cost—Note A

 

$

13,903,352

   

$

6,175,220

   

Investments in unaffiliated issuers, at value—Note A

 

$

12,631,649

   

$

5,906,591

   

Investments in affiliated issuers, at value

   

2,248,479

     

482,564

   
Total Investments    

14,880,128

     

6,389,155

   

Foreign currency at value (cost: $5; $3; $3; and $1, respectively)

   

4

     

7

   

Prepaid Expenses

   

2,591

     

4,948

   

Receivables:

 
Capital stock sold    

41,696

     

2,146

   

Dividends and interest—Note B

   

8,835

     

1,835

   

Investment securities sold

   

10,506

     

45,991

   

Investment Adviser reimbursement

   

4,272

     

3,728

   

Other

   

277

     

74

   
Total Assets    

14,948,309

     

6,447,884

   

LIABILITIES

 

Payables:

 

Capital stock reacquired

   

     

   

Investment securities purchased

   

18,799

     

3,103

   

Payable to bank

   

24,237

     

42,934

   

Accrued expenses:

 

Investment advisory fees—Note B

   

6,318

     

2,515

   

Distribution expense

   

4,031

     

1,781

   

Trustees fees

   

     

   

Compliance expense

   

5,686

     

5,686

   

Transfer agent fees

   

     

   

Printing and other shareholder communication fees

   

226

     

106

   

Custodian fees

   

5,331

     

6,109

   

Legal and audit fees

   

27,922

     

27,864

   

Other accrued expenses

   

11,911

     

11,900

   
Total Liabilities    

104,461

     

101,998

   
NET ASSETS  

$

14,843,848

   

$

6,345,886

   

SEE NOTES TO FINANCIAL STATEMENTS
39



December 31, 2013

Statements of Assets and Liabilities, continued

   

Growth

 

Growth and Income

 

NET ASSETS REPRESENTED BY

 
Paid in Capital  

$

13,270,350

   

$

9,869,352

   
Undistributed (distributions in excess of) net investment income    

     

   
Accumulated net realized gain (loss)    

280,470

     

271,993

   

Net unrealized appreciation (depreciation) of:

 
Investments    

1,549,920

     

1,006,491

   

Foreign currency translations

   

17

     

18

   
NET ASSETS  

$

15,100,757

   

$

11,147,854

   

Class A

 
Net assets  

$

9,432,147

   

$

5,966,482

   
Capital Shares Outstanding    

753,813

     

491,988

   

Net asset value per share

 

$

12.51

   

$

12.13

   

Institutional Class

 
Net assets  

$

3,508,356

   

$

1,487,129

   
Capital Shares Outstanding    

279,800

     

122,394

   

Net asset value per share

 

$

12.54

   

$

12.15

   

Class C

 
Net assets  

$

2,160,254

   

$

3,694,293

   
Capital Shares Outstanding    

173,491

     

305,927

   

Net asset value per share

 

$

12.45

   

$

12.08

   

SEE NOTES TO FINANCIAL STATEMENTS
40



December 31, 2013

   

Balanced

 

Income

 

NET ASSETS REPRESENTED BY

 
Paid in Capital  

$

13,631,767

   

$

6,050,128

   
Undistributed (distributions in excess of) net investment income    

     

3,251

   
Accumulated net realized gain (loss)    

235,289

     

78,563

   

Net unrealized appreciation (depreciation) of:

 
Investments    

976,776

     

213,935

   

Foreign currency translations

   

16

     

9

   
NET ASSETS  

$

14,843,848

   

$

6,345,886

   

Class A

 
Net assets  

$

7,446,127

   

$

2,727,570

   
Capital Shares Outstanding    

643,985

     

254,492

   

Net asset value per share

 

$

11.56

   

$

10.72

   

Institutional Class

 
Net assets  

$

4,311,549

   

$

2,167,911

   
Capital Shares Outstanding    

372,278

     

202,023

   

Net asset value per share

 

$

11.58

   

$

10.73

   

Class C

 
Net assets  

$

3,086,172

   

$

1,450,405

   
Capital Shares Outstanding    

269,090

     

136,868

   

Net asset value per share

 

$

11.47

   

$

10.60

   

SEE NOTES TO FINANCIAL STATEMENTS
41



Year Ended December 31, 2013

Statements of Operations

   

Growth

 

Growth and Income

 

INVESTMENT INCOME

 

Income

 
Dividends (net of foreign withholding tax of $3,698; $3,438; $3,130;
and $866; respectively)
 

$

244,383

   

$

250,000

   

Dividends from affiliate—Note C

   

44,325

     

53,702

   

Interest

   

14

     

11,775

   

Other income

   

(69

)

   

(87

)

 

Total Income

   

288,653

     

315,390

   

Expenses

 

Investment advisory fees—Note B

   

111,117

     

97,956

   

Distribution expenses—Class A (Note B)

   

24,067

     

11,471

   

Distribution expenses—Class C (Note B)

   

4,807

     

6,900

   

Service plan expenses—Class C (Note B)

   

14,419

     

20,700

   

Transfer agent fees

   

15,962

     

8,823

   

Printing and other shareholder communication fees

   

8,131

     

9,373

   

Custodian fees

   

114,126

     

116,438

   

Legal fees and related expenses

   

13,843

     

13,804

   

Trustees' fees and expenses

   

17,753

     

17,247

   

Compliance expense

   

11,090

     

11,090

   

Audit fees

   

21,822

     

26,263

   

Registration fees

   

51,137

     

51,768

   

Other expenses

   

887

     

889

   

Total Expenses

   

409,161

     

392,722

   

Less:

 

Advisory fee waiver—Note B

   

(14,965

)

   

(20,992

)

 

Expenses assumed by Adviser—Note B

   

(210,335

)

   

(221,883

)

 

Net expenses

   

183,861

     

149,847

   

Net investment income (loss)

   

104,792

     

165,543

   

REALIZED AND UNREALIZED GAIN (LOSS)—Notes A and C

 

Net realized gain (loss) on:

 

Investments in unaffiliated issuers

   

2,618,562

     

2,238,540

   

Investments in affiliated issuers

   

428,806

     

349,978

   

Foreign currency transactions

   

(159

)

   

(134

)

 

Change in unrealized appreciation (depreciation) on:

 
Investments in unaffiliated issuers    

51,226

     

(273,000

)

 

Investments in affiliated issuers

   

326,384

     

160,922

   

Foreign currency translation

   

(15

)

   

(43

)

 
Net realized and unrealized gain (loss) on investments and
foreign currency
   

3,424,804

     

2,476,263

   

Net increase (decrease) in net assets resulting from operations

 

$

3,529,596

   

$

2,641,806

   

SEE NOTES TO FINANCIAL STATEMENTS
42



Year Ended December 31, 2013

   

Balanced

 

Income

 

INVESTMENT INCOME

 

Income

 
Dividends (net of foreign withholding tax of $3,698; $3,438; $3,130;
and $866; respectively)
 

$

327,395

   

$

169,215

   

Dividends from affiliate—Note C

   

55,590

     

17,636

   

Interest

   

43,661

     

35,763

   

Other income

   

(82

)

   

(26

)

 

Total Income

   

426,564

     

222,588

   

Expenses

 

Investment advisory fees—Note B

   

125,170

     

52,155

   

Distribution expenses—Class A (Note B)

   

18,969

     

5,119

   

Distribution expenses—Class C (Note B)

   

6,858

     

3,144

   

Service plan expenses—Class C (Note B)

   

20,574

     

9,433

   

Transfer agent fees

   

8,613

     

4,991

   

Printing and other shareholder communication fees

   

10,456

     

6,516

   

Custodian fees

   

116,154

     

114,967

   

Legal fees and related expenses

   

14,054

     

13,534

   

Trustees' fees and expenses

   

17,662

     

16,914

   

Compliance expense

   

11,090

     

11,090

   

Audit fees

   

26,263

     

26,263

   

Registration fees

   

51,531

     

51,124

   

Other expenses

   

1,587

     

466

   

Total Expenses

   

428,981

     

315,716

   

Less:

 

Advisory fee waiver—Note B

   

(18,794

)

   

(7,986