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 811-5017

Ivy Variable Insurance Portfolios

(Exact name of registrant as specified in charter)

6300 Lamar Avenue, Overland Park, Kansas 66202

(Address of principal executive offices) (Zip code)

Jennifer K. Dulski

6300 Lamar Avenue

Overland Park, Kansas 66202

(Name and address of agent for service)

Registrant’s telephone number, including area code: (913) 236-2000

Date of fiscal year end: December 31

Date of reporting period: June 30, 2020

ITEM 1. REPORTS TO STOCKHOLDERS.

  VARIABLE INSURANCE PORTFOLIOS   Semiannual Report   JUNE 30, 2020

Ivy Variable Insurance Portfolios
Asset Strategy	Class I	Class II
Balanced		Class II
Energy	Class I	Class II
Growth		Class II
High Income	Class I	Class II
International Core Equity		Class II
Mid Cap Growth	Class I	Class II
Natural Resources		Class II
Science and Technology	Class I	Class II
Small Cap Core		Class II
Small Cap Growth	Class I	Class II

Beginning on January 1, 2021, as permitted by regulations adopted by the U.S. Securities and Exchange Commission (SEC), you may not be receiving paper copies of the Fund’s annual or semi-annual shareholder reports by mail, unless you specifically request paper copies of the reports from the insurance company that offers your variable annuity or variable life insurance contract or from your financial intermediary. Instead of delivering paper copies of the report, the insurance company may choose to make the reports available on a website, and will notify you by mail each time a shareholder report is posted and provide you with a website link to access the report. Instructions for requesting paper copies will be provided by your insurance company.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the insurance company or your financial intermediary electronically by following the instructions provided by the insurance company or by contacting your financial intermediary.

You may elect to receive all future Fund shareholder reports in paper free of charge from the insurance company. You can inform the insurance company or your financial intermediary that you wish to continue receiving paper copies of your shareholder reports by following the instructions provided by the insurance company or by contacting your financial intermediary. Your election to receive reports in paper will apply to all portfolio companies available under your contract with the insurance company.

CONTENTS IVY VIP

President’s Letter	3
Illustration of Portfolio Expenses	4
Portfolio Highlights and Schedule of Investments:
Asset Strategy	6
Balanced	13
Energy	20
Growth	23
High Income	26
International Core Equity	34
Mid Cap Growth	38
Natural Resources	41
Science and Technology	44
Small Cap Core	47
Small Cap Growth	50
Statements of Assets and Liabilities	54
Statements of Operations	56
Statements of Changes in Net Assets	58
Financial Highlights	60
Notes to Financial Statements	68
Proxy Voting Information	87
Quarterly Portfolio Schedule Information	88

2 SEMIANNUAL REPORT 2020

PRESIDENT’S LETTER IVY VIP

	JUNE 30, 2020 (UNAUDITED)
Philip J. Sanders, CFA

Dear Shareholder,

Markets thus far in 2020 have been, to use an overused word, unprecedented. In a matter of months, we have witnessed economic and market moves that typically take an entire market cycle of many years to unfold. Financial markets had been positive in early 2020, as political conflicts, trade uncertainty and global economic growth concerns waned. However, that upward trajectory suddenly reversed in late February 2020 and markets declined in response to two exogenous shocks: the COVID-19 pandemic and the collapse in energy markets. The COVID-19 pandemic caused one of the most rapid and dramatic global economic downturns in history. The U.S. stock markets dropped approximately 35% from peak in February to trough in late March. Global economic activity hit a full stop around the world, as countries and businesses implemented plans to isolate and protect each other. The pause on economic activity, along with a conflict between Russia and Saudi Arabia, caused a historic rout in oil markets. Remarkably, within about 30 days, we moved from a relatively strong domestic economy with financial market indexes hitting record highs, to a global recession.

Governments and central banks have taken unprecedented steps to mitigate the economic blow of social distancing. Monetary policy response has been broader and more rapid than at any other time in history. Global central banks have enacted aggressive stimulus through lower interest rates, quantitative easing (QE) and liquidity provisions, with some developing countries implementing QE for the first time. The U.S. Federal Reserve’s (Fed) response has been the strongest with a broad array of policy measures including an unprecedented pace of QE.

Just as global central banks are acting aggressively, governments around the world are responding with fiscal stimulus. While projected budget deficits for many countries are huge, those figures include loans designed to keep companies afloat and people employed. Up to this point, the fiscal impulse for most major countries is between 5 and 10% of gross domestic product (GDP). This is extremely aggressive both in size and speed of implementation, as we have only been facing this pandemic for a few months. More global fiscal stimulus seems probable. For instance, in addition to the $2.2 trillion CARES (Coronavirus Aid, Relief and Economic Security) Act, we expect another large fiscal stimulus in the U.S. to become law, which will likely include some form of extension to unemployment benefits and provide aid to state and local governments.

Enthusiasm about the economy possibly regaining momentum has been muted by ongoing uncertainty regarding the public health risks of reopening. While volatility has retreated sharply from the record highs of late March, it remains at elevated levels. Recent moves have shown that markets are likely to respond to changes in new

COVID-19 cases, both positively and negatively. Since the March 23 trough, the S&P 500 Index has stabilized and experienced a rapid bounce back. Year-to-date as of June 30, the Index is down 3.1%. Given this rebound, investors might wonder if the market is ahead of itself.

As we move forward and examine the investment landscape, we continue to put greater emphasis on the fundamentals and quality of asset classes and sectors. We believe it is important to stay focused on the merits of individual market sectors, industries and company business models when making investment decisions. Those fundamentals historically have tended to outweigh external factors. In today’s environment, we believe there are many high-quality businesses offering attractive entry points and cyclicals that will likely be key beneficiaries as economies continue to recover. Importantly, through this uncertain time, we remain focused on the innovation and management skill within individual companies, the ultimate drivers of long-term stock prices.

Economic Snapshot

	6/30/2020			12/31/2019
S&P 500 Index		3,100.29			3,230.78
MSCI EAFE Index		1,780.58			2,036.94
10-Year Treasury Yield		0.66	%		1.92	%
U.S. unemployment rate		11.1	%		3.5	%
30-year fixed mortgage rate		3.13	%		3.74	%
Oil price per barrel		$39.27			$61.14

Sources: Bloomberg, U.S. Department of Labor, MBA, CME

All government statistics shown are subject to periodic revision. The S&P 500 Index is an unmanaged index that tracks the stocks of 500 primarily large-cap U.S. companies. MSCI EAFE Index is an unmanaged index comprised of securities that represent the securities markets in Europe, Australasia and the Far East. It is not possible to invest directly in any of these indexes. Mortgage rates are from BankRate and reflect the overnight national average rate on a conventional 30-year fixed loan. Oil prices reflect the market price of West Texas intermediate grade crude.

Respectfully,

Philip J. Sanders, CFA

President

The opinions expressed in this letter are those of the President of the Ivy Variable Insurance Portfolios and are current only through the end of the period of the report, as stated on the cover. The President’s views are subject to change at any time, based on market and other conditions, and no forecasts can be guaranteed.

2020 SEMIANNUAL REPORT 3

ILLUSTRATION OF PORTFOLIO EXPENSES IVY VIP

(UNAUDITED)

Expense Example

As a shareholder of a Portfolio, you incur ongoing costs, including management fees, distribution and service fees, and other Portfolio expenses. The following table is intended to help you understand your ongoing costs (in dollars) of investing in a Portfolio 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 six-month period ended June 30, 2020.

Actual Expenses

The first section in the following table provides information about actual investment values and actual expenses for each share class. You may use the information in this section, together with your initial investment in Portfolio shares, to estimate the expenses that you paid over the period. Simply divide the value of that investment by $1,000 (for example, a $7,500 initial investment divided by $1,000 = 7.5), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your investment during this period. In addition, there are fees and expenses imposed under the variable annuity or variable life insurance contract through which shares of the Portfolio are held. Additional fees have the effect of reducing investment returns.

Hypothetical Example for Comparison Purposes

The second section in the following table provides information about hypothetical investment values and hypothetical expenses for each share class based on the Portfolio’s actual expense ratio and an assumed rate of return of five percent per year before expenses, which is not the Portfolio’s actual return. The hypothetical investment values and expenses may not be used to estimate the actual investment value at the end of the period or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Portfolio and other funds. To do so, compare this five percent hypothetical example with the five percent 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 as a shareholder of the Portfolio and do not reflect any fees and expenses imposed under the variable annuity or variable life insurance contract through which shares of the Portfolio are held.

Expenses paid may be impacted by expense reduction arrangements. If those arrangements had not been in place, expenses paid would have been higher. See Note 6 in Notes to Financial Statements for further information.

4 SEMIANNUAL REPORT 2020

ILLUSTRATION OF PORTFOLIO EXPENSES IVY VIP

(UNAUDITED)

	Actual(1)						Hypothetical(2)
Portfolio	Beginning Account Value 12-31-19		Ending Account Value 6-30-20		Expenses Paid During Period*		Beginning Account Value 12-31-19		Ending Account Value 6-30-20		Expenses Paid During Period*		Annualized Expense Ratio Based on the Six-Month Period
Asset Strategy
Class I	$	1,000	$	952.70	$	3.71	$	1,000	$	1,021.04	$	3.84		0.77%
Class II	$	1,000	$	951.50	$	4.98	$	1,000	$	1,019.80	$	5.15		1.02%
Balanced
Class II	$	1,000	$	967.70	$	5.02	$	1,000	$	1,019.76	$	5.15		1.03%
Energy
Class I	$	1,000	$	532.00	$	3.98	$	1,000	$	1,019.67	$	5.25		1.05%
Class II	$	1,000	$	531.30	$	4.90	$	1,000	$	1,018.42	$	6.46		1.30%
Growth
Class II	$	1,000	$	1,087.90	$	5.22	$	1,000	$	1,019.87	$	5.05		1.00%
High Income
Class I	$	1,000	$	929.30	$	3.28	$	1,000	$	1,021.43	$	3.44		0.69%
Class II	$	1,000	$	928.10	$	4.53	$	1,000	$	1,020.18	$	4.75		0.94%
International Core Equity
Class II	$	1,000	$	892.00	$	5.49	$	1,000	$	1,019.05	$	5.86		1.17%
Mid Cap Growth
Class I	$	1,000	$	1,119.60	$	4.45	$	1,000	$	1,020.65	$	4.24		0.85%
Class II	$	1,000	$	1,118.20	$	5.83	$	1,000	$	1,019.41	$	5.55		1.10%
Natural Resources
Class II	$	1,000	$	772.70	$	5.94	$	1,000	$	1,018.17	$	6.76		1.35%
Science and Technology
Class I	$	1,000	$	1,045.80	$	4.71	$	1,000	$	1,020.31	$	4.65		0.91%
Class II	$	1,000	$	1,044.40	$	5.93	$	1,000	$	1,019.08	$	5.86		1.16%
Small Cap Core
Class II	$	1,000	$	830.40	$	5.49	$	1,000	$	1,018.84	$	6.06		1.21%
Small Cap Growth
Class I	$	1,000	$	998.20	$	4.40	$	1,000	$	1,020.44	$	4.44		0.89%
Class II	$	1,000	$	996.90	$	5.69	$	1,000	$	1,019.19	$	5.75		1.14%

* Portfolio expenses are equal to the Portfolio’s annualized expense ratio (provided in the table), multiplied by the average account value over the period, multiplied by 182 days in the six-month period ended June 30, 2020, and divided by 366.

(1) This section uses the Portfolio’s actual total return and actual Portfolio expenses. It is a guide to the actual expenses paid by the Portfolio in the period. The “Ending Account Value” shown is computed using the Portfolio’s actual return and the “Expenses Paid During Period” column shows the dollar amount that would have been paid by an investor who started with $1,000 in the Portfolio. A shareholder may use the information here, together with the dollar amount invested, to estimate the expenses that were paid over the period. For every thousand dollars a shareholder has invested, the expenses are listed in the last column of this section.

(2) This section uses a hypothetical five percent annual return and actual Portfolio expenses. It helps to compare the Portfolio’s ongoing costs with other mutual funds. A shareholder can compare the Portfolio’s ongoing costs by comparing this hypothetical example with the hypothetical examples that appear in shareholder reports of other Portfolios.

The above illustrations are based on ongoing costs only.

2020 SEMIANNUAL REPORT 5

PORTFOLIO HIGHLIGHTS ASSET STRATEGY

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Stocks	62.3%
Information Technology	19.9%
Industrials	9.7%
Financials	8.0%
Consumer Discretionary	7.2%
Health Care	7.2%
Consumer Staples	4.7%
Energy	1.9%
Materials	1.6%
Utilities	1.2%
Communication Services	0.9%
Bullion (Gold)	6.8%
Purchased Options	0.0%
Bonds	28.8%
Corporate Debt Securities	18.8%
United States Government and Government Agency Obligations	4.2%
Loans	3.5%
Mortgage-Backed Securities	1.4%
Other Government Securities	0.9%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	2.1%

Country Weightings

North America	49.5%
United States	47.0%
Other North America	2.5%
Bullion (Gold)	6.8%
Europe	26.5%
France	6.0%
United Kingdom	5.5%
Germany	5.4%
Switzerland	3.9%
Other Europe	5.7%
Pacific Basin	12.8%
South America	1.4%
Bahamas/Caribbean	0.9%
Liabilities (Net of Cash and Other Assets), Cash Equivalents+ and Purchased Options	2.1%

Top 10 Equity Holdings

Company	Country	Sector	Industry
Microsoft Corp.	United States	Information Technology	Systems Software
Amazon.com, Inc.	United States	Consumer Discretionary	Internet & Direct Marketing Retail
Taiwan Semiconductor Manufacturing Co. Ltd.	Taiwan	Information Technology	Semiconductors
Visa, Inc., Class A	United States	Information Technology	Data Processing & Outsourced Services
Adobe, Inc.	United States	Information Technology	Application Software
Zimmer Holdings, Inc.	United States	Health Care	Health Care Equipment
ASML Holding N.V., Ordinary Shares	Netherlands	Information Technology	Semiconductor Equipment
Intuit, Inc.	United States	Information Technology	Application Software
ORIX Corp.	Japan	Financials	Consumer Finance
Ingersoll-Rand, Inc.	United States	Industrials	Industrial Machinery

See your advisor or www.ivyinvestments.com for more information on the Portfolio’s most recently published Top 10 Equity Holdings.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

6 SEMIANNUAL REPORT 2020

CONSOLIDATED SCHEDULE OF INVESTMENTS ASSET STRATEGY (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS	Shares			Value
Communication Services
Integrated Telecommunication Services – 0.9%
Deutsche Telekom AG, Registered Shares (A)		388		$	6,514
Total Communication Services – 0.9%					6,514
Consumer Discretionary
Apparel, Accessories & Luxury Goods – 1.1%
adidas AG (A)		28			7,273
Auto Parts & Equipment – 1.0%
Aptiv plc		86			6,712
Automobile Manufacturers – 0.9%
Subaru Corp. (A)		180			3,768
Suzuki Motor Corp. (A)		61			2,075
					5,843
General Merchandise Stores – 0.9%
Dollar Tree, Inc. (B)		70			6,512
Internet & Direct Marketing Retail – 2.7%
Amazon.com, Inc. (B)		7			18,754
Leisure Facilities – 0.0%
COTA Racing & Entertainment LLC, Class B (B)(C)		—	*		—
Leisure Products – 0.0%
Media Group Holdings LLC, Series H (B)(C)(D)(E)		32			—	*
Media Group Holdings LLC, Series T (B)(C)(D)(E)		4			—
					—	*
Restaurants – 0.6%
Compass Group plc (A)		313			4,313
Total Consumer Discretionary – 7.2%					49,407
Consumer Staples
Distillers & Vintners – 0.8%
Pernod Ricard S.A. (A)		33			5,183
Household Products – 1.0%
Procter & Gamble Co. (The)		57			6,854
Hypermarkets & Super Centers – 0.9%
Wal-Mart Stores, Inc.		53			6,395
Packaged Foods & Meats – 0.9%
Nestle S.A., Registered Shares (A)		57			6,316
Personal Products – 1.1%
Beiersdorf Aktiengesellschaft (A)(F)		66			7,557
Total Consumer Staples – 4.7%					32,305
Energy
Oil & Gas Exploration & Production – 0.5%
Canadian Natural Resources Ltd.		215			3,739

COMMON STOCKS (Continued)	Shares		Value
Oil & Gas Refining & Marketing – 1.4%
Reliance Industries Ltd. (A)		409	$	9,307
Reliance Industries Ltd. (A)		27		288
				9,595
Total Energy – 1.9%				13,334
Financials
Consumer Finance – 1.5%
ORIX Corp. (A)		805		9,996
Diversified Banks – 1.5%
BNP Paribas S.A. (A)		148		5,912
UniCredit S.p.A. (A)		420		3,875
				9,787
Investment Banking & Brokerage – 0.7%
Morgan Stanley		105		5,077
Life & Health Insurance – 2.5%
AIA Group Ltd. (A)		885		8,282
Ping An Insurance (Group) Co. of China Ltd., H Shares (A)		914		9,110
				17,392
Mortgage REITs – 0.1%
AGNC Investment Corp.		52		675
Other Diversified Financial Services – 0.9%
Citigroup, Inc.		121		6,193
Thrifts & Mortgage Finance – 0.8%
Housing Development Finance Corp. Ltd. (A)		240		5,582
Total Financials – 8.0%				54,702
Health Care
Biotechnology – 0.9%
Sarepta Therapeutics, Inc. (B)		40		6,365
Health Care Equipment – 2.6%
Koninklijke Philips Electronics N.V., Ordinary Shares (A)		142		6,601
Zimmer Holdings, Inc.		94		11,220
				17,821
Managed Health Care – 0.8%
Anthem, Inc.		22		5,668
Pharmaceuticals – 2.9%
GlaxoSmithKline plc (A)		343		6,925
Merck & Co., Inc.		83		6,400
Merck KGaA (A)		61		7,081
				20,406
Total Health Care – 7.2%				50,260
Industrials
Aerospace & Defense – 1.7%
Airbus SE (A)		80		5,754

COMMON STOCKS (Continued)	Shares		Value
Aerospace & Defense (Continued)
Northrop Grumman Corp.		20	$	6,051
				11,805
Construction & Engineering – 1.6%
Larsen & Toubro Ltd. (A)		352		4,421
Vinci (A)(F)		71		6,606
				11,027
Construction Machinery & Heavy Trucks – 0.7%
Caterpillar, Inc.		39		4,982
Electrical Components & Equipment – 1.1%
Schneider Electric S.A. (A)		69		7,707
Industrial Machinery – 1.4%
Ingersoll-Rand, Inc. (B)		354		9,952
Railroads – 2.2%
Kansas City Southern		41		6,087
Union Pacific Corp.		53		8,909
				14,996
Trading Companies & Distributors – 1.0%
Ferguson plc (A)		82		6,725
Total Industrials – 9.7%				67,194
Information Technology
Application Software – 3.3%
Adobe, Inc. (B)		28		12,238
Intuit, Inc. (G)		36		10,613
				22,851
Data Processing & Outsourced Services – 3.3%
Fiserv, Inc. (B)		95		9,318
Visa, Inc., Class A		72		13,827
				23,145
Electronic Equipment & Instruments – 1.1%
Keyence Corp. (A)		19		7,837
Internet Services & Infrastructure – 0.7%
VeriSign, Inc. (B)		22		4,627
IT Consulting & Other Services – 0.7%
Garter, Inc., Class A (B)		38		4,602
Semiconductor Equipment – 1.6%
ASML Holding N.V., Ordinary Shares (A)		30		10,944
Semiconductors – 3.9%
QUALCOMM, Inc. (G)		98		8,951
Taiwan Semiconductor Manufacturing Co. Ltd. (A)		1,672		17,861
				26,812
Systems Software – 3.0%
Microsoft Corp.		103		20,887
Technology Hardware, Storage & Peripherals – 2.3%
Apple, Inc.		23		8,402

2020 SEMIANNUAL REPORT 7

CONSOLIDATED SCHEDULE OF INVESTMENTS ASSET STRATEGY (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS (Continued)	Shares		Value
Technology Hardware, Storage & Peripherals (Continued)
Samsung Electronics Co. Ltd. (A)		162	$	7,171
				15,573
Total Information Technology – 19.9%				137,278
Materials
Diversified Metals & Mining – 0.6%
Glencore International plc (A)		1,796		3,825
Gold – 1.0%
Barrick Gold Corp.		270		7,274
Total Materials – 1.6%				11,099
Utilities
Electric Utilities – 1.2%
E.ON AG (A)		754		8,509
Total Utilities – 1.2%				8,509
TOTAL COMMON STOCKS – 62.3%			$	430,602
(Cost: $408,725)

PURCHASED OPTIONS	Number of Contracts (Unrounded)		Notional Amount
AGNC Investment Corp.,
Call $14.00, Expires 9-18-20, OTC (Ctrpty: Morgan Stanley & Co., Inc.)		2,104		210		86
TOTAL PURCHASED OPTIONS – 0.0%					$	86
(Cost: $143)

CORPORATE DEBT SECURITIES	Principal
Communication Services
Cable & Satellite – 0.4%
Altice France Holding S.A.,
10.500%, 5-15-27 (H)	$	2,383	2,625
Integrated Telecommunication Services – 1.3%
AT&T, Inc.:
2.750%, 6-1-31		1,087	1,125
3.650%, 6-1-51		653	681
Frontier Communications Corp.:
7.625%, 4-15-24 (I)		2,119	699
6.875%, 1-15-25 (I)		6,323	1,882
11.000%, 9-15-25 (I)		5,680	1,960
9.000%, 8-15-31 (I)		2,119	641
West Corp.,
8.500%, 10-15-25 (H)		1,500	1,192
			8,180
Interactive Media & Services – 0.1%
Tencent Holdings Ltd.,
3.240%, 6-3-50 (H)		1,090	1,092
Total Communication Services – 1.8%			11,897

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Consumer Discretionary
Automobile Manufacturers – 0.3%
Ford Motor Co.:
8.500%, 4-21-23	$	1,081	$	1,143
9.000%, 4-22-25		1,081		1,169
				2,312
Casinos & Gaming – 0.0%
Sands China Ltd.,
3.800%, 1-8-26 (H)		200		205
General Merchandise Stores – 0.1%
Dollar General Corp.,
3.500%, 4-3-30		540		605
Hotels, Resorts & Cruise Lines – 0.1%
Carnival Corp.,
11.500%, 4-1-23 (H)		432		467
Internet & Direct Marketing Retail – 0.2%
Amazon.com, Inc.:
1.500%, 6-3-30		1,090		1,105
2.500%, 6-3-50		218		221
				1,326
Leisure Facilities – 0.3%
Circuit of the Americas LLC, Series D,
0.000%, 10-2-23 (C)(J)		3,642		2,389
Total Consumer Discretionary – 1.0%				7,304
Consumer Staples
Brewers – 0.2%
Anheuser-Busch InBev Worldwide, Inc. (GTD by AB INBEV/BBR/COB):
3.500%, 6-1-30		860		967
4.500%, 6-1-50		432		515
				1,482
Tobacco – 0.4%
Altria Group, Inc. (GTD by Philip Morris USA, Inc.),
5.950%, 2-14-49		1,567		2,054
B.A.T. Capital Corp. (GTD by British American Tobacco plc, B.A.T. Netherlands Finance B.V., B.A.T. International Finance B.V. and Reynolds American, Inc.),
4.906%, 4-2-30		647		760
				2,814
Total Consumer Staples – 0.6%				4,296
Energy
Integrated Oil & Gas – 1.1%
Petrobras Global Finance B.V. (GTD by Petroleo Brasileiro S.A.),
5.600%, 1-3-31 (F)		1,744		1,752
Petroleos Mexicanos:
6.490%, 1-23-27 (H)		4,223		3,855
6.840%, 1-23-30 (H)		1,233		1,081

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Integrated Oil & Gas (Continued)
Petronas Capital Ltd.:
3.500%, 4-21-30 (H)	$	432	$	480
4.550%, 4-21-50 (H)		424		537
				7,705
Oil & Gas Exploration & Production – 0.6%
Laredo Petroleum, Inc.:
9.500%, 1-15-25		2,741		1,895
10.125%, 1-15-28 (F)		3,064		2,114
				4,009
Oil & Gas Storage & Transportation – 1.1%
Energy Transfer Operating L.P.:
3.750%, 5-15-30		842		832
6.750%, 5-15-68		3,900		3,273
7.125%, 5-15-68		3,900		3,335
				7,440
Total Energy – 2.8%				19,154
Financials
Diversified Banks – 6.4%
Banco de Credito del Peru,
3.125%, 7-1-30 (H)		438		434
Banco Santander S.A.:
5.375%, 4-17-25 (H)		1,134		1,241
2.746%, 5-28-25		654		677
3.490%, 5-28-30		436		467
Bank of New York Mellon Corp. (The),
4.700%, 9-20-68		435		453
Barclays plc:
7.875%, 12-29-49		7,618		7,732
8.000%, 9-15-68		2,013		2,086
BNP Paribas S.A.,
2.219%, 6-9-26 (H)		200		204
Credit Agricole S.A.,
1.907%, 6-16-26 (H)		657		666
HSBC Holdings plc:
2.848%, 6-4-31		1,086		1,111
6.875%, 12-29-49		1,089		1,105
ING Groep N.V.,
6.875%, 12-29-49 (F)		2,681		2,776
Royal Bank of Scotland Group plc (The),
8.625%, 12-29-49		5,081		5,283
Societe Generale Group,
7.375%, 12-29-49 (H)		6,791		6,850
Societe Generale S.A.,
3.653%, 7-8-35 (H)		3,284		3,284
Standard Chartered plc,
7.500%, 12-29-49 (H)		3,731		3,851
UniCredit S.p.A.:
5.861%, 6-19-32 (H)		3,700		3,841
5.459%, 6-30-35 (H)		2,672		2,693
				44,754

8 SEMIANNUAL REPORT 2020

CONSOLIDATED SCHEDULE OF INVESTMENTS ASSET STRATEGY (in thousands)

JUNE 30, 2020 (UNAUDITED)

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Diversified Capital Markets – 1.4%
Credit Suisse Group AG:
2.193%, 6-5-26 (H)	$	654	$	662
6.375%, 2-21-68 (H)		1,232		1,251
7.500%, 6-11-68 (H)		2,852		3,066
7.125%, 7-29-68		4,855		5,003
				9,982
Investment Banking & Brokerage – 0.3%
Charles Schwab Corp. (The),
5.375%, 9-1-68		1,083		1,157
Macquarie Bank Ltd.,
3.624%, 6-3-30 (H)		872		913
				2,070
Life & Health Insurance – 0.1%
AIA Group Ltd.,
3.375%, 4-7-30 (H)		540		588
Multi-Line Insurance – 0.7%
Athene Holding Ltd.,
6.150%, 4-3-30		4,313		4,963
Other Diversified Financial Services – 0.3%
Grupo Aval Ltd.,
4.375%, 2-4-30 (H)		1,689		1,613
JPMorgan Chase & Co.,
2.956%, 5-13-31		332		353
				1,966
Specialized Finance – 0.2%
AerCap Ireland Capital Ltd. and AerCap Global Aviation Trust:
4.500%, 9-15-23		1,022		1,022
6.500%, 7-15-25		436		457
				1,479
Total Financials – 9.4%				65,802
Health Care
Pharmaceuticals – 0.2%
Teva Pharmaceutical Finance Netherlands III B.V. (GTD by Teva Pharmaceutical Industries Ltd.),
2.800%, 7-21-23		1,000		945
Total Health Care – 0.2%				945
Industrials
Aerospace & Defense – 1.4%
Boeing Co. (The):
4.875%, 5-1-25		1,083		1,179
5.150%, 5-1-30		3,047		3,400
5.805%, 5-1-50		1,083		1,278
Wolverine Escrow LLC:
8.500%, 11-15-24 (H)		2,080		1,362
9.000%, 11-15-26 (H)		2,081		1,363
13.125%, 11-15-27 (H)		2,081		1,353
				9,935
Air Freight & Logistics – 0.3%
FedEx Corp.:
4.250%, 5-15-30		1,081		1,234

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Air Freight & Logistics (Continued)
5.250%, 5-15-50	$	756	$	923
				2,157
Airlines – 0.2%
Aerovias de Mexico S.A. de C.V. (GTD by Grupo Aeromexico S.A.B. de C.V.),
7.000%, 2-5-25 (H)(I)		2,587		595
Southwest Airlines Co.,
5.250%, 5-4-25		542		572
				1,167
Total Industrials – 1.9%				13,259
Information Technology
IT Consulting & Other Services – 0.2%
Atento Luxco 1 S.A.,
6.125%, 8-10-22 (H)		744		603
Leidos, Inc. (GTD by Leidos Holdings, Inc.):
3.625%, 5-15-25 (H)		326		356
4.375%, 5-15-30 (H)		326		367
				1,326
Semiconductors – 0.3%
Broadcom, Inc.:
4.700%, 4-15-25 (H)		541		609
5.000%, 4-15-30 (H)		1,081		1,242
Microchip Technology, Inc.,
4.250%, 9-1-25 (H)		545		550
				2,401
Total Information Technology – 0.5%				3,727
Materials
Construction Materials – 0.2%
Hillman Group, Inc. (The),
6.375%, 7-15-22 (H)		1,079		996
Steel – 0.4%
CSN Resources S.A.,
7.625%, 2-13-23 (H)		2,960		2,745
Total Materials – 0.6%				3,741
TOTAL CORPORATE DEBT SECURITIES – 18.8%			$	130,125
(Cost: $139,317)
MORTGAGE-BACKED SECURITIES
Non-Agency REMIC/CMO – 1.4%
Credit Suisse Mortgage Trust, Series 2018-RPL8, Class A1 (Mortgage spread to 3-year U.S. Treasury index),
4.125%, 7-25-58 (H)(K)		1,686		1,726
Ellington Financial Mortgage Trust, Series 2018-1, Class B1 (Mortgage spread to 10-year U.S. Treasury index),
5.574%, 10-25-58 (H)(K)		1,500		1,509

MORTGAGE-BACKED SECURITIES (Continued)	Principal		Value
Non-Agency REMIC/CMO (Continued)
Homeward Opportunities Fund I Trust, Series 2019-1, Class B1 (Mortgage spread to 10-year U.S. Treasury index),
4.800%, 1-25-59 (H)(K)	$	1,061	$	1,032
Merrill Lynch Mortgage Investors Trust, Series 1998-C1, Class F,
6.250%, 11-15-26		602		602
Verus Securitization Trust, Series 2018-3, Class B1 (Mortgage spread to 5-year U.S. Treasury index),
5.694%, 10-25-58 (H)(K)		2,100		1,945
Verus Securitization Trust, Series 2019-1, Class B1 (Mortgage spread to 10-year U.S. Treasury index),
5.311%, 2-25-59 (H)(K)		3,432		3,028
				9,842
TOTAL MORTGAGE-BACKED SECURITIES – 1.4%			$	9,842
(Cost: $10,561)
OTHER GOVERNMENT SECURITIES(L)
Argentina – 0.8%
Province of Mendoza,
8.375%, 5-19-24		4,362		2,268
Republic of Argentina:
4.625%, 1-11-23 (I)		6,531		2,734
5.875%, 1-11-28 (I)		2,100		842
				5,844
Columbia – 0.1%
Republic of Columbia,
3.125%, 4-15-31		327		324
TOTAL OTHER GOVERNMENT SECURITIES – 0.9%			$	6,168
(Cost: $12,911)
LOANS (K)
Communication Services
Integrated Telecommunication Services – 0.7%
West Corp. (3-Month ICE LIBOR plus 400 bps),
5.000%, 10-10-24		6,062		5,150
Total Communication Services – 0.7%				5,150
Consumer Discretionary
Specialty Stores – 0.4%
Staples, Inc. (ICE LIBOR plus 500 bps),
5.687%, 4-12-26		3,402		2,917
Total Consumer Discretionary – 0.4%				2,917

2020 SEMIANNUAL REPORT 9

CONSOLIDATED SCHEDULE OF INVESTMENTS ASSET STRATEGY (in thousands)

JUNE 30, 2020 (UNAUDITED)

LOANS (K) (Continued)	Principal		Value
Energy
Oil & Gas Storage & Transportation – 0.3%
EPIC Crude Services L.P. (ICE LIBOR plus 500 bps),
5.370%, 3-1-26	$	2,818	$	2,151
Total Energy – 0.3%				2,151
Financials
Property & Casualty Insurance – 0.7%
Amynta Agency Borrower, Inc. (ICE LIBOR plus 400 bps),
4.678%, 2-28-25		5,283		4,556
Total Financials – 0.7%				4,556
Health Care
Health Care Facilities – 0.4%
Surgery Center Holdings, Inc. (ICE LIBOR plus 325 bps),
4.250%, 8-31-24		2,805		2,454
Health Care Services – 0.3%
Heartland Dental LLC (ICE LIBOR plus 375 bps),
3.678%, 4-30-25		2,605		2,311
Total Health Care – 0.7%				4,765
Materials
Construction Materials – 0.7%
Hillman Group, Inc. (The) (ICE LIBOR plus 350 bps),
5.072%, 5-31-25		5,277		4,934
Total Materials – 0.7%				4,934
TOTAL LOANS – 3.5%			$	24,473
(Cost: $27,950)

UNITED STATES GOVERNMENT AGENCY OBLIGATIONS	Principal		Value
Mortgage-Backed Obligations – 1.2%
Federal Home Loan Mortgage Corp. Agency REMIC/CMO,
4.500%, 1-15-43 (M)	$	5,314	$	825
Federal Home Loan Mortgage Corp. Agency REMIC/CMO (1-Month U.S. LIBOR plus 615 bps),
5.965%, 11-15-47 (K)(M)		3,069		474
Federal National Mortgage Association Agency REMIC/CMO:
4.500%, 10-25-40 (M)		2,584		423
4.500%, 5-25-47 (M)		2,058		340
5.000%, 3-25-49 (M)		1,988		303
Federal National Mortgage Association Agency REMIC/CMO (1-Month U.S. LIBOR plus 562 bps),
5.436%, 6-25-45 (K)(M)		4,019		906
Federal National Mortgage Association Agency REMIC/CMO (1-Month U.S. LIBOR plus 625 bps):
5.936%, 4-25-45 (K)(M)		1,997		497
5.916%, 4-25-46 (K)(M)		4,661		918
5.916%, 8-25-46 (K)(M)		4,752		993
6.066%, 6-25-48 (K)(M)		10,624		2,305
				7,984
TOTAL UNITED STATES GOVERNMENT AGENCY OBLIGATIONS – 1.2%			$	7,984
(Cost: $8,143)
UNITED STATES GOVERNMENT OBLIGATIONS
Treasury Inflation Protected Obligations – 1.3%
U.S. Treasury Notes:
0.625%, 1-15-26		2,772		3,005
0.125%, 7-15-26		5,776		6,140
				9,145

UNITED STATES GOVERNMENT OBLIGATIONS (Continued)	Principal		Value
Treasury Obligations – 1.7%
U.S. Treasury Bonds:
2.750%, 8-15-47	$	7,526	$	9,829
3.000%, 2-15-49		1,591		2,195
				12,024
TOTAL UNITED STATES GOVERNMENT OBLIGATIONS – 3.0%			$	21,169
(Cost: $17,538)
BULLION – 6.8%	Troy Ounces
Gold		27		47,359
(Cost: $32,745)
SHORT-TERM SECURITIES	Shares
Money Market Funds (O) – 4.6%
Dreyfus Institutional Preferred Government Money Market Fund – Institutional Shares, 0.100% (N)		17,625		17,625
State Street Institutional U.S. Government Money Market Fund – Premier Class, 0.120%		14,347		14,347
				31,972
TOTAL SHORT-TERM SECURITIES – 4.6%			$	31,972
(Cost: $31,972)
TOTAL INVESTMENT SECURITIES – 102.5%			$	709,780
(Cost: $690,005)
LIABILITIES, NET OF CASH AND OTHER ASSETS – (2.5)%				(17,204	)
NET ASSETS – 100.0%			$	692,576

Notes to Consolidated Schedule of Investments

* Not shown due to rounding.

(A) Listed on an exchange outside the United States.

(B) No dividends were paid during the preceding 12 months.

(C) Restricted securities. At June 30, 2020, the Portfolio owned the following restricted securities:

Security	Acquisition Date(s)		Shares		Cost		Value
Media Group Holdings LLC, Series H		8-29-13 to 10-31-13		32	$	22,329	$	—	*
Media Group Holdings LLC, Series T		7-2-13 to 1-23-15		4		8,413		—
					$	30,742	$	—	*

10 SEMIANNUAL REPORT 2020

CONSOLIDATED SCHEDULE OF INVESTMENTS ASSET STRATEGY (in thousands)

JUNE 30, 2020 (UNAUDITED)

The total value of these securities represented 0.0% of net assets at June 30, 2020.

(D) Investment is owned by an entity that is treated as a corporation for U.S. tax purposes and is owned by the Portfolio and consolidated as described in Note 5 of the Notes to Financial Statements.

(E) Securities whose value was determined using significant unobservable inputs.

(F) All or a portion of securities with an aggregate value of $16,835 are on loan.

(G) All or a portion of securities with an aggregate value of $6,838 are held in collateralized accounts to cover potential obligations with respect to outstanding written options.

(H) Securities were purchased pursuant to an exemption from registration available under Rule 144A under the Securities Act of 1933 and may only be resold in transactions exempt from registration, normally to qualified institutional buyers. At June 30, 2020 the total value of these securities amounted to $64,072 or 9.3% of net assets.

(I) Non-income producing as the issuer has either missed its most recent interest payment or declared bankruptcy.

(J) Zero coupon bond.

(K) Variable rate security. Interest rate disclosed is that which is in effect at June 30, 2020. Description of the reference rate and spread, if applicable, are included in the security description.

(L) Other Government Securities may include emerging markets sovereign, quasi-sovereign, corporate and supranational agency and organization debt securities.

(M) Interest-only security. Amount shown as principal represents notional amount for computation of interest.

(N) Investment made with cash collateral received from securities on loan.

(O) Rate shown is the annualized 7-day yield at June 30, 2020.

The following written options were outstanding at June 30, 2020 (contracts and exercise prices unrounded):

Underlying Security	Counterparty, if OTC	Type	Number of Contracts		Notional Amount	Expiration Month		Exercise Price		Premium Received		Value
AGNC Investment Corp.	Morgan Stanley & Co., Inc.	Put		2,104	211		September 2020	$	10.00	$	140	$	(50	)
	Morgan Stanley & Co., Inc.	Call		2,104	210		September 2020		17.00		32		(12	)
										$	172	$	(62	)

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Common Stocks
Communication Services	$	—	$	6,514	$	—
Consumer Discretionary		31,978		17,429		—	*
Consumer Staples		13,249		19,056		—
Energy		4,027		9,307		—
Financials		11,945		42,757		—
Health Care		36,254		14,006		—
Industrials		35,981		31,213		—
Information Technology		93,465		43,813		—
Materials		7,274		3,825		—
Utilities		—		8,509		—
Total Common Stocks	$	234,173	$	196,429	$	—	*
Purchased Options		—		86		—
Corporate Debt Securities		—		130,125		—
Mortgage-Backed Securities		—		9,842		—
Other Government Securities		—		6,168		—
Loans		—		24,473		—
United States Government Agency Obligations		—		7,984		—
United States Government Obligations		—		21,169		—
Bullion		47,359		—		—
Short-Term Securities		31,972		—		—
Total	$	313,504	$	396,276	$	—	*
Liabilities
Written Options	$	—	$	62	$	—

2020 SEMIANNUAL REPORT 11

CONSOLIDATED SCHEDULE OF INVESTMENTS ASSET STRATEGY (in thousands)

JUNE 30, 2020 (UNAUDITED)

During the period ended June 30, 2020, securities totaling $4,938 were transferred from Level 3 to Level 2 due to increased availability of observable market data due to increased market activity or information for these securities.

The following acronyms are used throughout this schedule:

CMO = Collaterized Mortgage Obligation

GTD = Guaranteed

ICE = Intercontinental Exchange

LIBOR = London Interbank Offered Rate

OTC = Over the Counter

REIT = Real Estate Investment Trust

REMIC = Real Estate Mortgage Investment Conduit

Country Diversification

(as a % of net assets)
United States	47.0%
France	6.0%
United Kingdom	5.5%
Germany	5.4%
Switzerland	3.9%
Japan	3.4%
Netherlands	3.3%
India	2.8%

Country Diversification (Continued)

Taiwan	2.6%
Canada	1.5%
Italy	1.5%
China	1.4%
Hong Kong	1.3%
South Korea	1.0%
Mexico	1.0%
Other Countries	3.5%
Other+	8.9%

+Includes gold bullion, options, liabilities (net of cash and other assets), and cash equivalents

See Accompanying Notes to Financial Statements.

12 SEMIANNUAL REPORT 2020

PORTFOLIO HIGHLIGHTS BALANCED

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Stocks	65.4%
Information Technology	18.0%
Financials	8.8%
Consumer Discretionary	8.3%
Health Care	8.3%
Industrials	7.3%
Communication Services	6.4%
Consumer Staples	4.0%
Energy	3.7%
Materials	0.6%
Bonds	33.8%
Corporate Debt Securities	20.8%
United States Government and Government Agency Obligations	12.3%
Loans	0.7%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	0.8%

Top 10 Equity Holdings

Company	Sector	Industry
Apple, Inc.	Information Technology	Technology Hardware, Storage & Peripherals
Microsoft Corp.	Information Technology	Systems Software
Autodesk, Inc.	Information Technology	Application Software
Lowe’s Co., Inc.	Consumer Discretionary	Home Improvement Retail
Electronic Arts, Inc.	Communication Services	Interactive Home Entertainment
Zimmer Holdings, Inc.	Health Care	Health Care Equipment
Constellation Brands, Inc.	Consumer Staples	Distillers & Vintners
QUALCOMM, Inc.	Information Technology	Semiconductors
Cisco Systems, Inc.	Information Technology	Communications Equipment
Facebook, Inc., Class A	Communication Services	Interactive Media & Services

See your advisor or www.ivyinvestments.com for more information on the Portfolio’s most recently published Top 10 Equity Holdings.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

2020 SEMIANNUAL REPORT 13

SCHEDULE OF INVESTMENTS BALANCED (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS	Shares		Value
Communication Services
Interactive Home Entertainment – 1.9%
Electronic Arts, Inc. (A)		44	$	5,755
Interactive Media & Services – 3.9%
Alphabet, Inc., Class A (A)		3		3,763
Alphabet, Inc., Class C (A)		3		3,759
Facebook, Inc., Class A (A)		20		4,565
				12,087
Movies & Entertainment – 0.6%
Walt Disney Co. (The)		17		1,900
Total Communication Services – 6.4%				19,742
Consumer Discretionary
Apparel, Accessories & Luxury Goods – 0.9%
V.F. Corp.		48		2,896
Automotive Retail – 0.8%
O’Reilly Automotive, Inc. (A)		5		2,300
Casinos & Gaming – 1.2%
Las Vegas Sands, Inc.		80		3,633
Home Improvement Retail – 2.2%
Lowe’s Co., Inc.		50		6,798
Internet & Direct Marketing Retail – 1.3%
Amazon.com, Inc. (A)		1		4,058
Restaurants – 0.8%
Darden Restaurants, Inc.		30		2,284
Specialty Stores – 1.1%
Tractor Supply Co.		25		3,289
Total Consumer Discretionary – 8.3%				25,258
Consumer Staples
Distillers & Vintners – 1.6%
Constellation Brands, Inc.		29		5,033
Packaged Foods & Meats – 1.0%
Mondelez International, Inc., Class A		58		2,989
Tobacco – 1.4%
Philip Morris International, Inc.		62		4,335
Total Consumer Staples – 4.0%				12,357
Energy
Integrated Oil & Gas – 1.3%
Chevron Corp.		14		1,205
Hess Corp.		51		2,627
				3,832
Oil & Gas Exploration & Production – 0.8%
Canadian Natural Resources Ltd.		151		2,626

COMMON STOCKS (Continued)	Shares		Value
Oil & Gas Storage & Transportation – 0.6%
Enterprise Products Partners L.P.		97	$	1,762
Total Energy – 2.7%				8,220
Financials
Diversified Banks – 0.7%
Northern Trust Corp.		26		2,030
Insurance Brokers – 1.0%
Aon plc (A)		15		2,978
Investment Banking & Brokerage – 1.4%
Goldman Sachs Group, Inc. (The)		23		4,454
Multi-Sector Holdings – 1.3%
Berkshire Hathaway, Inc., Class B (A)		22		3,876
Other Diversified Financial Services – 1.6%
Citigroup, Inc.		36		1,833
JPMorgan Chase & Co.		34		3,240
				5,073
Regional Banks – 1.1%
PNC Financial Services Group, Inc. (The)		33		3,496
Total Financials – 7.1%				21,907
Health Care
Health Care Equipment – 1.7%
Zimmer Holdings, Inc.		44		5,249
Health Care Technology – 1.4%
Cerner Corp.		64		4,384
Managed Health Care – 1.9%
Anthem, Inc.		16		4,227
UnitedHealth Group, Inc.		5		1,561
				5,788
Pharmaceuticals – 3.2%
Elanco Animal Health, Inc. (A)		98		2,093
GlaxoSmithKline plc ADR		94		3,825
Jazz Pharmaceuticals plc (A)		15		1,669
Merck & Co., Inc.		31		2,372
				9,959
Total Health Care – 8.2%				25,380
Industrials
Aerospace & Defense – 2.1%
Boeing Co. (The)		15		2,753
Northrop Grumman Corp.		5		1,396
Raytheon Technologies Corp.		37		2,250
				6,399
Agricultural & Farm Machinery – 1.1%
Deere & Co.		22		3,429

COMMON STOCKS (Continued)	Shares		Value
Electrical Components & Equipment – 0.7%
Emerson Electric Co.		34	$	2,129
Industrial Machinery – 1.0%
Snap-on, Inc.		21		2,940
Railroads – 1.4%
Union Pacific Corp.		25		4,206
Research & Consulting Services – 1.0%
IHS Markit Ltd.		39		2,969
Total Industrials – 7.3%				22,072
Information Technology
Application Software – 2.3%
Autodesk, Inc. (A)		29		6,986
Communications Equipment – 2.2%
Cisco Systems, Inc.		102		4,769
Motorola Solutions, Inc.		16		2,193
				6,962
Data Processing & Outsourced Services – 1.4%
Fiserv, Inc. (A)		45		4,367
Electronic Manufacturing Services – 0.9%
IPG Photonics Corp. (A)		18		2,887
IT Consulting & Other Services – 0.8%
Cognizant Technology Solutions Corp., Class A		42		2,394
Semiconductors – 3.7%
Infineon Technologies AG ADR		148		3,487
Micron Technology, Inc. (A)		61		3,144
QUALCOMM, Inc.		54		4,944
				11,575
Systems Software – 3.3%
Microsoft Corp.		49		9,984
Technology Hardware, Storage & Peripherals – 3.4%
Apple, Inc.		29		10,566
Total Information Technology – 18.0%				55,721
Materials
Specialty Chemicals – 0.6%
Sherwin-Williams Co. (The)		3		1,918
Total Materials – 0.6%				1,918
TOTAL COMMON STOCKS – 62.6%			$	192,575
(Cost: $176,924)

14 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS BALANCED (in thousands)

JUNE 30, 2020 (UNAUDITED)

INVESTMENT FUNDS	Shares		Value
Registered Investment Companies – 1.7%
Invesco Senior Loan ETF		131	$	2,793
iShares iBoxx $ High Yield Corporate Bond ETF		9		716
iShares iBoxx $ Investment Grade Corporate Bond ETF		12		1,559
				5,068
TOTAL INVESTMENT FUNDS – 1.7%			$	5,068
(Cost: $5,067)
PREFERRED STOCKS
Energy
Oil & Gas Exploration & Production – 1.0%
Targa Resources Corp.,
9.500% (A)(B)		3		3,127
Total Energy – 1.0%				3,127
Health Care
Pharmaceuticals – 0.1%
Elanco Animal Health, Inc.,
5.000%		8		307
Total Health Care – 0.1%				307
TOTAL PREFERRED STOCKS – 1.1%			$	3,434
(Cost: $3,625)
CORPORATE DEBT SECURITIES	Principal
Communication Services
Advertising – 0.1%
Lamar Media Corp.,
4.875%, 1-15-29 (C)	$	230		231
Broadcasting – 0.1%
Fox Corp.,
3.050%, 4-7-25		340		368
Cable & Satellite – 0.5%
Charter Communications Operating LLC and Charter Communications Operating Capital Corp.,
2.800%, 4-1-31		360		365
Comcast Corp. (GTD by Comcast Cable Communications and NBCUniversal),
4.250%, 10-15-30		450		551
Comcast Corp. (GTD by Comcast Cable Communications LLC and NBCUniversal Media LLC),
3.450%, 2-1-50		675		765
				1,681
Movies & Entertainment – 0.3%
Walt Disney Co. (The),
2.750%, 9-1-49		1,000		976

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Publishing – 0.2%
Thomson Reuters Corp.,
3.350%, 5-15-26	$	425	$	462
Wireless Telecommunication Service – 0.2%
T-Mobile USA, Inc.,
3.875%, 4-15-30 (C)		575		641
Total Communication Services – 1.4%				4,359
Consumer Discretionary
Automobile Manufacturers – 0.2%
General Motors Co.,
6.800%, 10-1-27		475		553
Casinos & Gaming – 0.3%
Colt Merger Sub, Inc.,
8.125%, 7-1-27 (C)		320		311
International Game Technology plc,
5.250%, 1-15-29 (C)		350		340
Las Vegas Sands Corp.,
3.500%, 8-18-26		220		220
				871
General Merchandise Stores – 0.2%
Dollar General Corp.,
3.500%, 4-3-30		300		336
Target Corp.,
2.650%, 9-15-30		350		384
				720
Homebuilding – 0.1%
NVR, Inc.,
3.000%, 5-15-30		400		418
Hotels, Resorts & Cruise Lines – 0.0%
Carnival Corp.,
11.500%, 4-1-23 (C)		120		130
Internet & Direct Marketing Retail – 0.5%
Amazon.com, Inc.,
2.800%, 8-22-24		1,000		1,087
Expedia Group, Inc.:
6.250%, 5-1-25 (C)		360		384
7.000%, 5-1-25 (C)		43		45
				1,516
Leisure Facilities – 0.1%
Cedar Fair Entertainment Co., Magnum Management Corp., Canada’s Wonderland Co. and Millennium Operations LLC,
5.500%, 5-1-25 (C)		350		352
Total Consumer Discretionary – 1.4%				4,560
Consumer Staples
Agricultural Products – 0.1%
Archer Daniels Midland Co.,
2.750%, 3-27-25		350		380

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Brewers – 0.1%
Anheuser-Busch InBev Worldwide, Inc. (GTD by AB INBEV/BBR/COB),
4.750%, 1-23-29	$	312	$	377
Drug Retail – 0.1%
CVS Health Corp.,
5.050%, 3-25-48		300		390
Food Distributors – 0.1%
U.S. Foods, Inc.,
6.250%, 4-15-25 (C)		120		122
Food Retail – 0.1%
Alimentation Couche-Tard, Inc.,
2.950%, 1-25-30 (C)		350		363
Household Products – 0.1%
Procter & Gamble Co. (The),
3.000%, 3-25-30		350		401
Hypermarkets & Super Centers – 1.1%
Walmart, Inc.,
4.050%, 6-29-48		2,500		3,278
Packaged Foods & Meats – 0.2%
Nestle Holdings, Inc.,
4.000%, 9-24-48 (C)		555		715
Personal Products – 0.2%
Estee Lauder Co., Inc. (The),
4.150%, 3-15-47		375		474
Soft Drinks – 0.7%
Coca-Cola Co. (The),
3.375%, 3-25-27		400		459
Keurig Dr Pepper, Inc.,
3.400%, 11-15-25		400		445
PepsiCo, Inc.,
2.875%, 10-15-49		1,050		1,136
				2,040
Total Consumer Staples – 2.8%				8,540
Energy
Oil & Gas Drilling – 0.4%
Nabors Industries Ltd., Convertible,
0.750%, 1-15-24		3,600		1,298
Oil & Gas Exploration & Production – 0.2%
EQT Corp.,
6.125%, 2-1-25 (D)		500		498
Oil & Gas Storage & Transportation – 0.6%
Colorado Interstate Gas Co.,
4.150%, 8-15-26 (C)		800		890
Williams Partners L.P.,
3.600%, 3-15-22		1,000		1,039
				1,929
Total Energy – 1.2%				3,725

2020 SEMIANNUAL REPORT 15

SCHEDULE OF INVESTMENTS BALANCED (in thousands)

JUNE 30, 2020 (UNAUDITED)

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Financials
Asset Management & Custody Banks – 0.5%
Apollo Management Holdings L.P.,
2.650%, 6-5-30 (C)	$	600	$	597
Brookfield Finance, Inc. (GTD by Brookfield Asset Management, Inc.),
4.350%, 4-15-30		475		536
National Securities Clearing Corp.,
1.500%, 4-23-25 (C)		350		358
				1,491
Consumer Finance – 0.1%
General Motors Financial Co., Inc. (GTD by AmeriCredit Financial Services, Inc.):
3.450%, 4-10-22		250		255
3.700%, 5-9-23		150		154
				409
Diversified Banks – 0.2%
Bank of America Corp.,
2.884%, 10-22-30		400		433
U.S. Bancorp,
3.100%, 4-27-26		400		444
				877
Investment Banking & Brokerage – 0.9%
Goldman Sachs Group, Inc. (The),
2.905%, 7-24-23		2,000		2,078
Morgan Stanley,
2.699%, 1-22-31		400		425
				2,503
Life & Health Insurance – 0.7%
Northwestern Mutual Life Insurance Co. (The),
3.850%, 9-30-47 (C)		1,000		1,143
Sumitomo Life Insurance Co.,
4.000%, 9-14-77 (C)		1,000		1,070
				2,213
Multi-Line Insurance – 0.3%
Aon Corp. (GTD by Aon plc),
2.800%, 5-15-30		350		374
Aon plc (GTD by Aon Corp.),
2.800%, 3-15-21		500		509
				883
Other Diversified Financial Services – 0.9%
Citigroup, Inc.:
2.666%, 1-29-31		350		363
5.950%, 12-29-49		150		142
6.250%, 12-29-49		750		796
JPMorgan Chase & Co.:
2.956%, 5-13-31		267		284
5.300%, 11-1-68		250		237
JPMorgan Chase & Co. (3-Month U.S. LIBOR plus 332 bps),
4.753%, 1-1-68 (E)		750		662

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Other Diversified Financial Services (Continued)
JPMorgan Chase & Co. (3-Month U.S. LIBOR plus 347 bps),
4.230%, 4-29-49 (E)	$	194	$	177
				2,661
Property & Casualty Insurance – 0.1%
Berkshire Hathaway Finance Corp. (GTD by Berkshire Hathaway, Inc.),
2.200%, 3-15-21		200		202
Regional Banks – 0.2%
PNC Bank N.A.,
3.250%, 6-1-25		600		665
Specialized Finance – 0.1%
AerCap Ireland Capital Ltd. and AerCap Global Aviation Trust,
6.500%, 7-15-25		250		262
Total Financials – 4.0%				12,166
Health Care
Biotechnology – 0.3%
Amgen, Inc.,
3.375%, 2-21-50		700		767
Biogen, Inc.,
2.250%, 5-1-30		235		237
				1,004
Health Care Supplies – 0.7%
Baxter International, Inc.,
3.750%, 10-1-25 (C)		350		399
Dentsply Sirona, Inc.,
3.250%, 6-1-30		475		498
Shire Acquisitions Investments Ireland Designated Activity Co.,
2.875%, 9-23-23		1,000		1,059
				1,956
Life Sciences Tools & Services – 0.2%
Thermo Fisher Scientific, Inc.,
4.133%, 3-25-25		350		400
Managed Health Care – 0.0%
UnitedHealth Group, Inc.,
2.000%, 5-15-30		125		131
Pharmaceuticals – 1.1%
Bristol-Myers Squibb Co.,
3.450%, 11-15-27 (C)		500		575
Forest Laboratories, Inc.,
5.000%, 12-15-21 (C)		1,258		1,321
Johnson & Johnson,
3.400%, 1-15-38		1,000		1,181
Zoetis, Inc.,
2.000%, 5-15-30		235		240
				3,317
Total Health Care – 2.3%				6,808

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Industrials
Aerospace & Defense – 1.1%
BAE Systems plc,
3.400%, 4-15-30 (C)	$	350	$	382
Boeing Co. (The),
3.750%, 2-1-50		525		474
General Dynamics Corp.,
3.625%, 4-1-30		350		410
L3Harris Technologies, Inc.,
4.400%, 6-15-28		1,000		1,182
Raytheon Technologies Corp.:
2.250%, 7-1-30		300		313
3.125%, 7-1-50		175		187
Spirit AeroSystems, Inc. (GTD by Spirit AeroSystems Holdings, Inc.),
4.600%, 6-15-28		535		429
				3,377
Agricultural & Farm Machinery – 0.2%
Deere & Co.,
3.100%, 4-15-30		600		680
Air Freight & Logistics – 0.2%
United Parcel Service, Inc.,
3.900%, 4-1-25		650		738
Airlines – 0.3%
Southwest Airlines Co.:
2.650%, 11-5-20		375		375
4.750%, 5-4-23		600		620
				995
Environmental & Facilities Services – 0.6%
Republic Services, Inc.,
3.050%, 3-1-50		700		715
Waste Management, Inc. (GTD by Waste Management Holdings, Inc.),
3.150%, 11-15-27		1,000		1,120
				1,835
Industrial Conglomerates – 0.1%
Honeywell International, Inc.,
1.950%, 6-1-30		300		313
Research & Consulting Services – 0.2%
CoStar Group, Inc.,
2.800%, 7-15-30 (C)		350		358
RELX Capital, Inc. (GTD by RELX plc),
3.000%, 5-22-30		350		379
				737
Total Industrials – 2.7%				8,675
Information Technology
Application Software – 0.3%
Autodesk, Inc.,
2.850%, 1-15-30		500		551
Infor, Inc.,
1.750%, 7-15-25 (C)		125		126

16 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS BALANCED (in thousands)

JUNE 30, 2020 (UNAUDITED)

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Application Software (Continued)
Intuit, Inc.:
1.350%, 7-15-27	$	115	$	115
1.650%, 7-15-30		290		289
				1,081
Communications Equipment – 0.2%
Motorola Solutions, Inc.,
4.600%, 2-23-28		400		455
Data Processing & Outsourced Services – 0.2%
PayPal Holdings, Inc.,
2.300%, 6-1-30		350		364
Visa, Inc.,
2.700%, 4-15-40		240		257
				621
IT Consulting & Other Services – 0.1%
Leidos, Inc. (GTD by Leidos Holdings, Inc.),
3.625%, 5-15-25 (C)		175		191
Semiconductor Equipment – 0.1%
Lam Research Corp.,
1.900%, 6-15-30		350		358
Semiconductors – 0.5%
Broadcom, Inc.,
4.700%, 4-15-25 (C)		300		338
Intel Corp.,
3.250%, 11-15-49		500		570
Xilinx, Inc.,
2.375%, 6-1-30		525		540
				1,448
Systems Software – 0.1%
Microsoft Corp.,
2.525%, 6-1-50		350		362
Technology Hardware, Storage & Peripherals – 0.6%
Apple, Inc.:
3.200%, 5-11-27		1,000		1,134
2.950%, 9-11-49		500		548
				1,682
Total Information Technology – 2.1%				6,198
Materials
Construction Materials – 0.4%
Hillman Group, Inc. (The),
6.375%, 7-15-22 (C)		1,318		1,216
Diversified Metals & Mining – 0.1%
Anglo American plc,
4.125%, 4-15-21 (C)		500		508
Fertilizers & Agricultural Chemicals – 0.1%
Nutrien Ltd.,
2.950%, 5-13-30		350		371

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Metal & Glass Containers – 0.1%
Ardagh Packaging Finance plc and Ardagh Holdings USA, Inc.,
5.250%, 8-15-27 (C)	$	220	$	216
Specialty Chemicals – 0.4%
Ecolab, Inc.,
3.250%, 12-1-27		1,000		1,134
Total Materials – 1.1%				3,445
Real Estate
Real Estate Services – 0.1%
Realogy Group LLC and Realogy Co-Issuer Corp. (GTD by Realogy Intermediate Holdings LLC),
7.625%, 6-15-25 (C)		350		349
Specialized REITs – 0.7%
American Tower Corp.,
2.250%, 1-15-22		1,200		1,230
Crown Castle International Corp.:
5.250%, 1-15-23		200		223
3.100%, 11-15-29		600		643
				2,096
Total Real Estate – 0.8%				2,445
Utilities
Electric Utilities – 0.7%
Duke Energy Corp.,
3.150%, 8-15-27		500		554
Entergy Texas, Inc.,
2.550%, 6-1-21		300		305
Exelon Corp.,
2.450%, 4-15-21		400		405
Florida Power & Light Co.,
3.150%, 10-1-49		425		483
Oncor Electric Delivery Co. LLC,
2.750%, 5-15-30 (C)		450		494
				2,241
Multi-Utilities – 0.2%
Dominion Energy, Inc.,
3.600%, 3-15-27		450		498
Water Utilities – 0.1%
American Water Capital Corp.,
3.750%, 9-1-47		375		435
Total Utilities – 1.0%				3,174
TOTAL CORPORATE DEBT SECURITIES – 20.8%			$	64,095
(Cost: $62,183)

LOANS (E)	Principal		Value
Consumer Discretionary
Casinos & Gaming – 0.2%
Golden Nugget LLC,
0.000%, 10-4-23 (F)	$	867	$	685
Leisure Facilities – 0.3%
United PF Holdings LLC (ICE LIBOR plus 400 bps),
4.308%, 1-6-27		1,019		898
Total Consumer Discretionary – 0.5%				1,583
Industrials
Industrial Machinery – 0.2%
Form Technologies LLC (ICE LIBOR plus 850 bps),
9.500%, 1-30-23		1,100		601
Total Industrials – 0.2%				601
TOTAL LOANS – 0.7%			$	2,184
(Cost: $2,686)
UNITED STATES GOVERNMENT AGENCY OBLIGATIONS
Mortgage-Backed Obligations – 1.0%
Federal Home Loan Mortgage Corp. Agency REMIC/CMO,
3.000%, 6-15-45		679		719
Federal National Mortgage Association Agency REMIC/CMO:
3.500%, 6-25-29		440		478
3.000%, 10-25-46		679		722
Federal National Mortgage Association Fixed Rate Pass-Through Certificates:
6.500%, 10-1-28		54		60
6.500%, 2-1-29		23		25
7.500%, 4-1-31		26		29
7.000%, 7-1-31		32		39
7.000%, 9-1-31		56		67
6.500%, 2-1-32		131		157
7.000%, 2-1-32		84		99
7.000%, 3-1-32		31		38
7.000%, 7-1-32		61		72
5.500%, 5-1-33		26		30
5.500%, 6-1-33		29		33
4.500%, 11-1-43		418		474
U.S. Department of Veterans Affairs, Guaranteed REMIC Pass-Through Certificates, Vendee Mortgage Trust, Series 1997-1, Class 3A,
8.293%, 12-15-26		22		26
				3,068
TOTAL UNITED STATES GOVERNMENT AGENCY OBLIGATIONS – 1.0%			$	3,068
(Cost: $2,927)

2020 SEMIANNUAL REPORT 17

SCHEDULE OF INVESTMENTS BALANCED (in thousands)

JUNE 30, 2020 (UNAUDITED)

UNITED STATES GOVERNMENT OBLIGATIONS	Principal		Value
Treasury Inflation Protected Obligations – 1.4%
U.S. Treasury Bonds:
2.125%, 2-15-40	$	1,026	$	1,513
1.000%, 2-15-46		487		630
U.S. Treasury Notes,
0.125%, 7-15-26		1,872		1,990
				4,133
Treasury Obligations – 9.9%
U.S. Treasury Bonds:
0.625%, 5-15-30		525		524
3.500%, 2-15-39		3,000		4,243
3.750%, 8-15-41		150		221
U.S. Treasury Notes:
2.875%, 11-15-21		750		778
2.000%, 10-31-22		480		500
2.125%, 12-31-22		2,900		3,041
2.750%, 11-15-23		1,600		1,737
1.750%, 6-30-24		1,400		1,485

UNITED STATES GOVERNMENT OBLIGATIONS (Continued)	Principal		Value
Treasury Obligations (Continued)
2.250%, 10-31-24	$	3,635	$	3,949
1.500%, 11-30-24		1,700		1,794
2.875%, 4-30-25		500		562
2.875%, 5-31-25		900		1,013
3.000%, 9-30-25		900		1,025
2.625%, 12-31-25		800		899
0.625%, 3-31-27		5,440		5,495
2.750%, 2-15-28		250		292
2.875%, 8-15-28		737		873
1.500%, 2-15-30		1,855		2,005
				30,436
TOTAL UNITED STATES GOVERNMENT OBLIGATIONS – 11.3%			$	34,569
(Cost: $31,616)

SHORT-TERM SECURITIES	Shares		Value
Money Market Funds (H) – 1.1%
Dreyfus Institutional Preferred Government Money Market Fund – Institutional Shares, 0.100% (G)		150	$	150
State Street Institutional U.S. Government Money Market Fund – Premier Class, 0.120%		3,373		3,373
				3,523
TOTAL SHORT-TERM SECURITIES – 1.1%			$	3,523
(Cost: $3,523)
TOTAL INVESTMENT SECURITIES – 100.3%			$	308,516
(Cost: $288,551)
LIABILITIES, NET OF CASH AND OTHER ASSETS – (0.3)%				(826	)
NET ASSETS – 100.0%			$	307,690

Notes to Schedule of Investments

(A) No dividends were paid during the preceding 12 months.

(B) Restricted security. At June 30, 2020, the Portfolio owned the following restricted security:

Security	Acquisition Date(s)		Shares		Cost		Value
Targa Resources Corp., 9.500%		3-2-20		3	$	3,225	$	3,127

The total value of this security represented 1.0% of net assets at June 30, 2020.

(C) Securities were purchased pursuant to an exemption from registration available under Rule 144A under the Securities Act of 1933 and may only be resold in transactions exempt from registration, normally to qualified institutional buyers. At June 30, 2020 the total value of these securities amounted to $14,165 or 4.6% of net assets.

(D) All or a portion of securities with an aggregate value of $147 are on loan.

(E) Variable rate security. Interest rate disclosed is that which is in effect at June 30, 2020. Description of the reference rate and spread, if applicable, are included in the security description.

(F) All or a portion of this position has not settled. Full contract rates do not take effect until settlement date.

(G) Investment made with cash collateral received from securities on loan.

(H) Rate shown is the annualized 7-day yield at June 30, 2020.

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Common Stocks	$	192,575	$	—	$	—
Investment Funds		5,068		—		—
Preferred Stocks		307		3,127		—
Corporate Debt Securities		—		64,095		—
Loans		—		2,184		—
United States Government Agency Obligations		—		3,068		—
United States Government Obligations		—		34,569		—
Short-Term Securities		3,523		—		—
Total	$	201,473	$	107,043	$	—

18 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS BALANCED (in thousands)

JUNE 30, 2020 (UNAUDITED)

The following acronyms are used throughout this schedule:

ADR = American Depositary Receipts

CMO = Collateralized Mortgage Obligation

GTD = Guaranteed

ICE = Intercontinental Exchange

LIBOR = London Interbank Offered Rate

REMIC = Real Estate Mortgage Investment Conduit

REIT = Real Estate Investment Trust

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 19

PORTFOLIO HIGHLIGHTS ENERGY

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Stocks	97.5%
Energy	84.5%
Information Technology	9.4%
Utilities	3.6%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	2.5%

Country Weightings

North America	95.3%
United States	91.3%
Canada	4.0%
Europe	2.2%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	2.5%

Top 10 Equity Holdings

Company	Country	Sector	Industry
Marathon Petroleum Corp.	United States	Energy	Oil & Gas Refining & Marketing
Phillips 66	United States	Energy	Oil & Gas Refining & Marketing
Valero Energy Corp.	United States	Energy	Oil & Gas Refining & Marketing
Wright Express Corp.	United States	Information Technology	Data Processing & Outsourced Services
Hess Corp.	United States	Energy	Integrated Oil & Gas
Pioneer Natural Resources Co.	United States	Energy	Oil & Gas Exploration & Production
Cactus, Inc., Class A	United States	Energy	Oil & Gas Equipment & Services
Concho Resources, Inc.	United States	Energy	Oil & Gas Exploration & Production
Exxon Mobil Corp.	United States	Energy	Oil & Gas Exploration & Production
Chevron Corp.	United States	Energy	Integrated Oil & Gas

See your advisor or www.ivyinvestments.com for more information on the Portfolio’s most recently published Top 10 Equity Holdings.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

20 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS ENERGY (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS	Shares		Value
Energy
Integrated Oil & Gas – 12.0%
Chevron Corp.		13	$	1,120
Hess Corp.		26		1,358
Suncor Energy, Inc.		42		712
Total S.A. ADR		19		729
				3,919
Oil & Gas Drilling – 1.0%
Helmerich & Payne, Inc.		17		332
Oil & Gas Equipment & Services – 19.2%
Baker Hughes, Inc.		71		1,098
Cactus, Inc., Class A		61		1,264
ChampionX Corp. (A)		85		826
Dril-Quip, Inc. (A)		28		837
Halliburton Co.		63		818
Liberty Oilfield Services, Inc., Class A		27		149
National Oilwell Varco, Inc.		35		426
Schlumberger Ltd.		47		858
				6,276
Oil & Gas Exploration & Production – 32.3%
Cabot Oil & Gas Corp.		22		385
Canadian Natural Resources Ltd.		34		587
Concho Resources, Inc.		24		1,238
ConocoPhillips		25		1,054
Continental Resources, Inc. (B)		34		592
Diamondback Energy, Inc.		20		833
EOG Resources, Inc.		19		987
Exxon Mobil Corp.		25		1,125
Noble Energy, Inc.		16		145
Parsley Energy, Inc., Class A		92		983
Pioneer Natural Resources Co.		13		1,311
Viper Energy Partners L.P.		37		384
WPX Energy, Inc. (A)		152		967
				10,591

COMMON STOCKS (Continued)	Shares		Value
Oil & Gas Refining & Marketing – 15.8%
Marathon Petroleum Corp.		47	$	1,749
Phillips 66		24		1,745
Valero Energy Corp.		29		1,691
				5,185
Oil & Gas Storage & Transportation – 4.2%
Energy Transfer L.P.		29		203
Enterprise Products Partners L.P.		41		747
MPLX L.P.		11		182
Rattler Midstream L.P.		26		255
				1,387
Total Energy – 84.5%				27,690
Information Technology
Application Software – 2.6%
Aspen Technology, Inc. (A)		8		835
Data Processing & Outsourced Services – 4.2%
Wright Express Corp. (A)		8		1,387
Semiconductor Equipment – 1.4%
Enphase Energy, Inc. (A)		10		474
Semiconductors – 1.2%
First Solar, Inc. (A)		8		378
Total Information Technology – 9.4%				3,074
Utilities
Electric Utilities – 2.5%
American Electric Power Co., Inc.		4		314
Duke Energy Corp.		4		313
NextEra Energy, Inc.		1		203
				830

COMMON STOCKS (Continued)	Shares		Value
Multi-Utilities – 1.1%
Dominion Energy, Inc.		4	$	349
Total Utilities – 3.6%				1,179
TOTAL COMMON STOCKS – 97.5%			$	31,943
(Cost: $48,144)
SHORT-TERM SECURITIES
Money Market Funds (D) – 4.1%
Dreyfus Institutional Preferred Government Money Market Fund – Institutional Shares,
0.100% (C)		560		560
State Street Institutional U.S. Government Money Market Fund – Premier Class,
0.120%		793		793
				1,353
TOTAL SHORT-TERM SECURITIES – 4.1%			$	1,353
(Cost: $1,353)
TOTAL INVESTMENT SECURITIES – 101.6%			$	33,296
(Cost: $49,497)
LIABILITIES, NET OF CASH AND OTHER ASSETS – (1.6)%				(513	)
NET ASSETS – 100.0%			$	32,783

Notes to Schedule of Investments

(A) No dividends were paid during the preceding 12 months.

(B) All or a portion of securities with an aggregate value of $541 are on loan.

(C) Investment made with cash collateral received from securities on loan.

(D) Rate shown is the annualized 7-day yield at June 30, 2020.

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Common Stocks	$	31,943	$	—	$	—
Short-Term Securities		1,353		—		—
Total	$	33,296	$	—	$	—

2020 SEMIANNUAL REPORT 21

SCHEDULE OF INVESTMENTS ENERGY (in thousands)

JUNE 30, 2020 (UNAUDITED)

Country Diversification

(as a % of net assets)
United States	91.3%
Canada	4.0%
France	2.2%
Other+	2.5%

+Includes liabilities (net of cash and other assets), and cash equivalents

See Accompanying Notes to Financial Statements.

22 SEMIANNUAL REPORT 2020

PORTFOLIO HIGHLIGHTS GROWTH

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Stocks	99.1%
Information Technology	39.6%
Consumer Discretionary	18.0%
Health Care	14.0%
Communication Services	10.8%
Industrials	8.9%
Consumer Staples	3.5%
Financials	2.9%
Real Estate	1.4%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	0.9%

Top 10 Equity Holdings

Company	Sector	Industry
Microsoft Corp.	Information Technology	Systems Software
Apple, Inc.	Information Technology	Technology Hardware, Storage & Peripherals
Amazon.com, Inc.	Consumer Discretionary	Internet & Direct Marketing Retail
Visa, Inc., Class A	Information Technology	Data Processing & Outsourced Services
Alphabet, Inc., Class A	Communication Services	Interactive Media & Services
Facebook, Inc., Class A	Communication Services	Interactive Media & Services
Motorola Solutions, Inc.	Information Technology	Communications Equipment
Adobe, Inc.	Information Technology	Application Software
Coca-Cola Co. (The)	Consumer Staples	Soft Drinks
Cerner Corp.	Health Care	Health Care Technology

See your advisor or www.ivyinvestments.com for more information on the Portfolio’s most recently published Top 10 Equity Holdings.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

2020 SEMIANNUAL REPORT 23

SCHEDULE OF INVESTMENTS GROWTH (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS	Shares		Value
Communication Services
Interactive Home Entertainment – 2.5%
Electronic Arts, Inc. (A)		152	$	20,017
Interactive Media & Services – 8.3%
Alphabet, Inc., Class A (A)		22		31,685
Alphabet, Inc., Class C (A)		5		7,465
Facebook, Inc., Class A (A)		126		28,606
				67,756
Total Communication Services – 10.8%				87,773
Consumer Discretionary
Apparel, Accessories & Luxury Goods – 1.2%
V.F. Corp.		166		10,145
Automobile Manufacturers – 1.6%
Ferrari N.V.		76		13,046
Automotive Retail – 1.1%
O’Reilly Automotive, Inc. (A)		21		8,720
Footwear – 0.7%
NIKE, Inc., Class B		61		5,933
Home Improvement Retail – 2.2%
Home Depot, Inc. (The)		73		18,253
Internet & Direct Marketing Retail – 8.6%
Amazon.com, Inc. (A)		18		49,035
Booking Holdings, Inc. (A)		13		20,933
				69,968
Specialty Stores – 2.6%
Tractor Supply Co.		158		20,853
Total Consumer Discretionary – 18.0%				146,918
Consumer Staples
Personal Products – 0.5%
Estee Lauder Co., Inc. (The), Class A		22		4,195
Soft Drinks – 3.0%
Coca-Cola Co. (The)		555		24,779
Total Consumer Staples – 3.5%				28,974
Financials
Financial Exchanges & Data – 2.9%
CME Group, Inc.		49		7,932
S&P Global, Inc.		47		15,638
				23,570
Total Financials – 2.9%				23,570
Health Care
Biotechnology – 1.4%
Vertex Pharmaceuticals, Inc. (A)		41		11,828

COMMON STOCKS (Continued)	Shares		Value
Health Care Equipment – 2.4%
Danaher Corp.		50	$	8,774
Intuitive Surgical, Inc. (A)		19		11,047
				19,821
Health Care Supplies – 1.9%
Cooper Cos., Inc. (The)		54		15,296
Health Care Technology – 2.9%
Cerner Corp.		350		23,978
Life Sciences Tools & Services – 1.2%
Mettler-Toledo International, Inc. (A)		12		9,448
Managed Health Care – 2.8%
UnitedHealth Group, Inc.		76		22,454
Pharmaceuticals – 1.4%
Zoetis, Inc.		81		11,080
Total Health Care – 14.0%				113,905
Industrials
Aerospace & Defense – 1.2%
Northrop Grumman Corp.		32		9,977
Construction Machinery & Heavy Trucks – 0.8%
Caterpillar, Inc.		50		6,369
Industrial Machinery – 2.4%
Stanley Black & Decker, Inc.		139		19,434
Railroads – 1.2%
Union Pacific Corp.		57		9,690
Research & Consulting Services – 2.1%
CoStar Group, Inc. (A)		7		5,013
Verisk Analytics, Inc., Class A		69		11,749
				16,762
Trucking – 1.2%
J.B. Hunt Transport Services, Inc.		83		10,016
Total Industrials – 8.9%				72,248
Information Technology
Application Software – 7.2%
Adobe, Inc. (A)		61		26,347
Intuit, Inc.		53		15,696
NVIDIA Corp.		43		16,417
				58,460
Communications Equipment – 3.3%
Motorola Solutions, Inc.		192		26,862
Data Processing & Outsourced Services – 10.9%
Broadridge Financial Solutions, Inc.		115		14,521
FleetCor Technologies, Inc. (A)		51		12,894
MasterCard, Inc., Class A		14		4,025
PayPal, Inc. (A)		115		19,960

COMMON STOCKS (Continued)	Shares		Value
Data Processing & Outsourced Services (Continued)
Visa, Inc., Class A		193	$	37,224
				88,624
Internet Services & Infrastructure – 1.4%
VeriSign, Inc. (A)		57		11,884
Systems Software – 9.8%
Microsoft Corp.		394		80,129
Technology Hardware, Storage & Peripherals –  7.0%
Apple, Inc.		157		57,291
Total Information Technology – 39.6%				323,250
Real Estate
Specialized REITs – 1.4%
American Tower Corp., Class A		24		6,231
Equinix, Inc.		8		5,515
				11,746
Total Real Estate – 1.4%				11,746
TOTAL COMMON STOCKS – 99.1%			$	808,384
(Cost: $542,779)
SHORT-TERM SECURITIES
Money Market Funds (B) – 1.0%
State Street Institutional U.S. Government Money Market Fund – Premier Class, 0.120%		8,180		8,180
TOTAL SHORT-TERM SECURITIES – 1.0%			$	8,180
(Cost: $8,180)
TOTAL INVESTMENT SECURITIES – 100.1%			$	816,564
(Cost: $550,959)
LIABILITIES, NET OF CASH AND OTHER ASSETS – (0.1)%				(431	)
NET ASSETS – 100.0%			$	816,133

24 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS GROWTH (in thousands)

JUNE 30, 2020 (UNAUDITED)

Notes to Schedule of Investments

(A) No dividends were paid during the preceding 12 months.

(B) Rate shown is the annualized 7-day yield at June 30, 2020.

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Common Stocks	$	808,384	$	—	$	—
Short-Term Securities		8,180		—		—
Total	$	816,564	$	—	$	—

The following acronym is used throughout this schedule:

REIT = Real Estate Investment Trust

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 25

PORTFOLIO HIGHLIGHTS HIGH INCOME

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Stocks	6.4%
Financials	4.2%
Consumer Discretionary	1.2%
Energy	1.0%
Health Care	0.0%
Consumer Staples	0.0%
Industrials	0.0%
Warrants	0.0%
Bonds	89.2%
Corporate Debt Securities	66.4%
Loans	22.8%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	4.4%

Quality Weightings

Investment Grade	0.1%
BBB	0.1%
Non-Investment Grade	89.1%
BB	9.5%
B	43.5%
CCC	29.7%
Below CCC	1.0%
Non-rated	5.4%
Liabilities (Net of Cash and Other Assets), Cash Equivalents+ and Equities	10.8%

Our preference is to always use ratings obtained from Standard & Poor’s, Moody’s, and Fitch. It is each Portfolio’s general policy to classify such security at the lower rating level if only two ratings are available. If more than two ratings are available and a median exists, the median is used. If more than two ratings exist without a median, the lower of the two middle ratings is used. We do not evaluate these ratings, but simply assign them to the appropriate credit quality category as determined by the rating agency.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

26 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS HIGH INCOME (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS	Shares			Value
Consumer Discretionary
Apparel Retail – 0.0%
True Religion Apparel, Inc. (A)(B)		13		$	—	*
Casinos & Gaming – 0.0%
New Cotai Participation Corp., Class B (A)(B)(C)		—	*		—
Education Services – 0.5%
Laureate Education, Inc., Class A (A)		443			4,411
Hotels, Resorts & Cruise Lines – 0.7%
Studio City International Holdings Ltd. ADR (A)		343			5,456
Total Consumer Discretionary – 1.2%					9,867
Consumer Staples
Agricultural Products – 0.0%
ASG Warrant Corp. (A)(B)(C)		1			—
Total Consumer Staples – 0.0%					—
Energy
Coal & Consumable Fuels – 0.0%
Westmoreland Coal Co. (A)		29			272
Oil & Gas Equipment & Services – 0.0%
Larchmont Resources LLC (A)(B)(C)(D)(E)		1			45
McDermott International, Inc. (A)(B)		21			—	*
					45
Oil & Gas Exploration & Production – 0.0%
Bellatrix Exploration Ltd. (A)(B)(D)		436			—	*
Sabine Oil & Gas Corp. (A)(B)(C)		—	*		4
					4
Total Energy – 0.0%					321
Health Care
Pharmaceuticals – 0.0%
Advanz Pharma Corp. (A)(D)		35			105
Total Health Care – 0.0%					105
Industrials
Air Freight & Logistics – 0.0%
BIS Industries Ltd. (B)(C)		1,605			—	*
Total Industrials – 0.0%					—	*
TOTAL COMMON STOCKS – 1.2%				$	10,293
(Cost: $13,362)
INVESTMENT FUNDS
Registered Investment Companies – 4.2%
Invesco Senior Loan ETF		424			9,056
iShares iBoxx $ High Yield Corporate Bond ETF		290			23,670
					32,726

	Shares		Value
TOTAL INVESTMENT FUNDS – 4.2%			$	32,726
(Cost: $33,375)
PREFERRED STOCKS
Consumer Staples
Agricultural Products – 0.0%
Pinnacle Agriculture Enterprises LLC (A)(B)(C)		4,583		—	*
Total Consumer Staples – 0.0%				—	*
Energy
Oil & Gas Exploration & Production – 1.0%
Targa Resources Corp., 9.500% (A)(C)		8		7,833
Total Energy – 1.0%				7,833
TOTAL PREFERRED STOCKS – 1.0%			$	7,833
(Cost: $10,499)
WARRANTS
Oil & Gas Exploration & Production – 0.0%
Ultra Resources, Inc., expires 7-14-25(B)(G)		20		1
TOTAL WARRANTS – 0.0%			$	1
(Cost: $5)
CORPORATE DEBT SECURITIES	Principal
Communication Services
Broadcasting – 1.2%
Clear Channel Outdoor Holdings, Inc.,
5.125%, 8-15-27 (F)	$	5,508		5,288
Clear Channel Worldwide Holdings, Inc.,
9.250%, 2-15-24		3,979		3,691
				8,979
Cable & Satellite – 9.8%
Altice Financing S.A.:
7.500%, 5-15-26 (F)		1,870		1,963
5.000%, 1-15-28 (F)		1,421		1,412
Altice France Holding S.A.:
10.500%, 5-15-27 (F)		12,589		13,867
6.000%, 2-15-28 (F)		10,750		10,152
Altice France S.A.:
7.375%, 5-1-26 (F)		5,343		5,578
8.125%, 2-1-27 (F)		7,213		7,898
CCO Holdings LLC and CCO Holdings Capital Corp.,
5.000%, 2-1-28 (F)		4,233		4,371
CSC Holdings LLC:
5.500%, 5-15-26 (F)		2,025		2,078
5.375%, 2-1-28 (F)		4,930		5,152
5.750%, 1-15-30 (F)		1,372		1,433
DISH DBS Corp.:
5.875%, 7-15-22		2,310		2,349
5.875%, 11-15-24		1,610		1,600
7.750%, 7-1-26		2,821		2,991
7.375%, 7-1-28 (F)		741		736

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Cable & Satellite (Continued)
Neptune Finco Corp., 6.625%, 10-15-25 (F)	$	788	$	819
VTR Comunicaciones S.p.A., 5.125%, 1-15-28 (F)		2,964		3,025
VTR Finance B.V.:
6.875%, 1-15-24 (F)		8,223		8,412
6.375%, 7-15-28 (F)		2,826		2,900
				76,736
Integrated Telecommunication Services – 4.0%
Frontier Communications Corp.:
6.875%, 1-15-25 (H)		6,315		1,880
11.000%, 9-15-25 (H)		8,236		2,842
8.500%, 4-1-26 (F)(H)		11,690		11,053
Northwest Fiber LLC, 10.750%, 6-1-28 (F)		957		995
West Corp., 8.500%, 10-15-25 (F)		18,737		14,896
				31,666
Publishing – 0.3%
MDC Partners, Inc., 6.500%, 5-1-24 (F)		2,381		2,214
Wireless Telecommunication Service – 2.4%
Digicel Group Ltd., 8.750%, 5-25-24 (F)		1,351		1,320
Digicel Group Ltd. (5.000% Cash and 3.000% PIK), 8.000%, 4-1-25 (F)(I)		573		143
Digicel Group Ltd. (7.000% Cash or 7.000% PIK), 7.000%, 10-1-68 (F)(I)		533		37
Digicel International Finance Ltd.:
8.750%, 5-25-24 (F)		9,626		9,409
8.000%, 12-31-26 (F)		539		324
Digicel International Finance Ltd. (6.000% Cash and 7.000% PIK), 13.000%, 12-31-25 (F)(I)		684		575
Digicel International Finance Ltd. (8.000% Cash and 2.000% PIK or 10.000% PIK), 10.000%, 4-1-24 (I)		4,983		3,438
Digicel Ltd., 6.750%, 3-1-23 (F)		6,795		3,499
				18,745
Total Communication Services – 17.7%				138,340
Consumer Discretionary
Apparel Retail – 0.4%
Abercrombie & Fitch Management Co. (GTD by Abercrombie & Fitch Co.),
8.750%, 7-15-25 (F)		2,594		2,555
L Brands, Inc.:
6.875%, 7-1-25 (F)		375		387
9.375%, 7-1-25 (F)		673		674
				3,616
Auto Parts & Equipment – 0.1%
Adient U.S. LLC, 9.000%, 4-15-25 (F)		597		643

2020 SEMIANNUAL REPORT 27

SCHEDULE OF INVESTMENTS HIGH INCOME (in thousands)

JUNE 30, 2020 (UNAUDITED)

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Automobile Manufacturers – 0.4%
Ford Motor Co.:
8.500%, 4-21-23	$	1,491	$	1,577
9.000%, 4-22-25		1,491		1,612
				3,189
Automotive Retail – 1.2%
Allison Transmission, Inc.,
5.000%, 10-1-24 (F)		781		779
Asbury Automotive Group, Inc.:
4.500%, 3-1-28 (F)		2,378		2,307
4.750%, 3-1-30 (F)		4,297		4,189
Lithia Motors, Inc., 4.625%, 12-15-27 (F)		1,119		1,108
Sonic Automotive, Inc., 6.125%, 3-15-27		1,198		1,186
				9,569
Casinos & Gaming – 3.0%
Boyd Gaming Corp.:
8.625%, 6-1-25 (F)		748		781
4.750%, 12-1-27 (F)		2,089		1,793
Colt Merger Sub, Inc.:
6.250%, 7-1-25 (F)		2,963		2,940
8.125%, 7-1-27 (F)		4,631		4,503
Everi Payments, Inc., 7.500%, 12-15-25 (F)		3,346		3,204
Gateway Casinos & Entertainment Ltd., 8.250%, 3-1-24 (F)		2,450		2,009
Golden Nugget, Inc.,
6.750%, 10-15-24 (F)		5,273		3,790
Scientific Games International, Inc. (GTD by Scientific Games Corp.):
5.000%, 10-15-25 (F)		1,023		944
7.000%, 5-15-28 (F)		282		226
7.250%, 11-15-29 (F)		282		226
Wynn Macau Ltd.:
4.875%, 10-1-24 (F)		855		834
5.500%, 10-1-27 (F)		2,301		2,278
				23,528
Department Stores – 0.1%
Nordstrom, Inc.:
4.000%, 10-15-21		393		393
8.750%, 5-15-25 (F)		296		318
				711
Education Services – 2.3%
Laureate Education, Inc.,
8.250%, 5-1-25 (F)		17,225		17,871
Hotels, Resorts & Cruise Lines – 0.5%
Boyne USA, Inc.,
7.250%, 5-1-25 (F)		2,468		2,585
NCL Corp. Ltd.,
12.250%, 5-15-24 (F)		1,507		1,576
				4,161
Leisure Facilities – 0.5%
Cedar Fair L.P., Magnum Management Corp., Canada’s Wonderland Co. and Millennium Operations LLC, 5.375%, 4-15-27		2,137		1,913

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Leisure Facilities (Continued)
Live Nation Entertainment, Inc., 4.750%, 10-15-27 (F)	$	1,521	$	1,308
Six Flags Theme Parks, Inc., 7.000%, 7-1-25 (F)		297		307
				3,528
Specialized Consumer Services – 0.1%
Nielsen Finance LLC and Nielsen Finance Co.,
5.000%, 4-15-22 (F)		896		893
Specialty Stores – 2.5%
Party City Holdings, Inc.,
6.625%, 8-1-26 (F)		1,785		384
Staples, Inc.:
7.500%, 4-15-26 (F)		18,924		14,869
10.750%, 4-15-27 (F)		7,355		4,486
				19,739
Total Consumer Discretionary – 11.1%				87,448
Consumer Staples
Food Distributors – 0.1%
Performance Food Group, Inc.,
6.875%, 5-1-25 (F)		373		385
Packaged Foods & Meats – 4.9%
JBS USA LLC and JBS USA Finance, Inc.:
5.875%, 7-15-24 (F)		6,983		7,079
5.750%, 6-15-25 (F)		4,650		4,708
JBS USA Lux S.A. and JBS USA Finance, Inc.,
6.750%, 2-15-28 (F)		3,115		3,290
JBS USA, JBS USA Food Co. and JBS USA Finance, Inc. (GTD by JBS S.A.):
6.500%, 4-15-29 (F)		545		578
5.500%, 1-15-30 (F)		2,078		2,130
Pilgrim’s Pride Corp.:
5.750%, 3-15-25 (F)		881		878
5.875%, 9-30-27 (F)		3,082		3,083
Post Holdings, Inc.:
5.000%, 8-15-26 (F)		1,267		1,272
5.750%, 3-1-27 (F)		7,368		7,626
Simmons Foods, Inc.:
7.750%, 1-15-24 (F)		1,656		1,728
5.750%, 11-1-24 (F)		6,704		6,369
				38,741
Total Consumer Staples – 5.0%				39,126
Energy
Oil & Gas Drilling – 0.6%
KCA Deutag UK Finance plc,
7.250%, 5-15-21 (F)		5,209		2,493
Offshore Drilling Holding S.A., 8.375%, 9-20-20 (F)(J)		8,682		2,008
				4,501
Oil & Gas Equipment & Services – 0.1%
Nine Energy Service, Inc.,
8.750%, 11-1-23 (F)		1,917		934

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Oil & Gas Exploration & Production – 3.6%
Bellatrix Exploration Ltd.,
8.500%, 9-11-23 (H)	$	1,022	$	—	*
Bellatrix Exploration Ltd. (3.000% Cash or 9.500% PIK),
9.500%, 12-15-23 (H)(I)		1,113		—	*
Crownrock L.P.,
5.625%, 10-15-25 (F)		6,957		6,235
Endeavor Energy Resources L.P.:
5.500%, 1-30-26 (F)		2,453		2,349
5.750%, 1-30-28 (F)		1,789		1,717
Endeavor Energy Resources L.P. and EER Finance, Inc.,
6.625%, 7-15-25 (F)		1,803		1,817
EQT Corp.,
6.125%, 2-1-25 (K)		1,492		1,487
Extraction Oil & Gas, Inc.,
5.625%, 2-1-26 (F)(H)		2,389		460
Laredo Petroleum, Inc.:
9.500%, 1-15-25		4,262		2,946
10.125%, 1-15-28 (K)		2,841		1,960
QEP Resources, Inc.:
5.250%, 5-1-23		1,438		949
5.625%, 3-1-26		1,085		689
Sanchez Energy Corp.,
7.250%, 2-15-23  (F)(H)		622		6
Seven Generations Energy Ltd.:
6.750%, 5-1-23 (F)		5,646		5,420
5.375%, 9-30-25 (F)		2,523		2,221
				28,256
Oil & Gas Refining & Marketing – 1.7%
Callon Petroleum Co. (GTD by Callon Petroleum Operating Co.):
6.125%, 10-1-24		1,081		368
6.375%, 7-1-26		386		127
Comstock Escrow Corp., 9.750%, 8-15-26		10,817		10,118
EP Energy LLC and Everest Acquisition Finance, Inc.:
9.375%, 5-1-24 (F)(H)		1,320		—	*
8.000%, 2-15-25 (F)(H)		1,386		—	*
7.750%, 5-15-26 (F)(H)		1,933		387
PBF Holding Co. LLC:
9.250%, 5-15-25 (F)		885		945
6.000%, 2-15-28 (F)		1,420		1,178
				13,123
Total Energy – 6.0%				46,814
Financials
Consumer Finance – 0.6%
Alliance Data Systems Corp., 4.750%, 12-15-24 (F)		2,991		2,692
CURO Group Holdings Corp., 8.250%, 9-1-25 (F)		2,815		2,251
				4,943
Financial Exchanges & Data – 0.8%
Refinitiv U.S. Holdings, Inc.,
8.250%, 11-15-26 (F)		5,889		6,378

28 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS HIGH INCOME (in thousands)

JUNE 30, 2020 (UNAUDITED)

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Insurance Brokers – 3.2%
Ardonagh Midco 2 plc, 11.500%, 1-15-27 (F)	$	6,277	$	6,308
NFP Corp.:
7.000%, 5-15-25 (F)		1,498		1,573
6.875%, 7-15-25 (F)		14,533		13,946
8.000%, 7-15-25 (F)		2,791		2,728
				24,555
Investment Banking & Brokerage – 0.5%
INTL FCStone, Inc., 8.625%, 6-15-25 (F)		3,791		3,959
Other Diversified Financial Services – 1.5%
New Cotai LLC and New Cotai Capital Corp. (10.625% Cash or 10.625% PIK), 10.625%, 5-1-19 (F)(H)(I)		26,095		11,743
Property & Casualty Insurance – 0.8%
Amwins Group, Inc., 7.750%, 7-1-26 (F)		4,026		4,227
Hub International Ltd., 7.000%, 5-1-26 (F)		1,827		1,827
				6,054
Specialized Finance – 1.7%
BCPE Cycle Merger Sub II, Inc., 10.625%, 7-15-27 (F)		5,496		5,661
Compass Group Diversified Holdings LLC, 8.000%, 5-1-26 (F)		7,778		7,910
				13,571
Thrifts & Mortgage Finance – 0.7%
Provident Funding Associates L.P. and PFG Finance Corp., 6.375%, 6-15-25 (F)		5,937		5,551
Total Financials – 9.8%				76,754
Health Care
Health Care Facilities – 1.7%
RegionalCare Hospital Partners Holdings, Inc. and Legend Merger Sub, Inc., 9.750%, 12-1-26 (F)		6,811		6,948
Surgery Center Holdings, Inc., 10.000%, 4-15-27(F)(K)		6,654		6,654
				13,602
Health Care Services – 0.5%
Heartland Dental LLC, 8.500%, 5-1-26 (F)		4,714		4,268
Health Care Technology – 1.5%
Verscend Holding Corp., 9.750%, 8-15-26 (F)		11,186		12,053
Pharmaceuticals – 1.7%
Advanz Pharma Corp., 8.000%, 9-6-24		430		398
Bausch Health Cos., Inc.:
9.000%, 12-15-25 (F)		855		921
9.250%, 4-1-26 (F)		2,515		2,729
8.500%, 1-31-27 (F)		5,239		5,560

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Pharmaceuticals (Continued)
Par Pharmaceutical, Inc., 7.500%, 4-1-27 (F)	$	2,871	$	2,946
				12,554
Total Health Care – 5.4%				42,477
Industrials
Aerospace & Defense – 5.2%
Arconic Rolled Products Corp., 6.125%, 2-15-28 (F)		568		568
TransDigm UK Holdings plc, 6.875%, 5-15-26		2,171		2,019
TransDigm, Inc. (GTD by TransDigm Group, Inc.):
6.500%, 7-15-24		6,077		5,848
6.500%, 5-15-25		1,162		1,087
6.250%, 3-15-26 (F)		7,179		7,174
6.375%, 6-15-26		2,490		2,272
7.500%, 3-15-27		2,673		2,569
5.500%, 11-15-27		6,936		6,055
Wolverine Escrow LLC:
8.500%, 11-15-24 (F)		7,697		5,041
9.000%, 11-15-26 (F)		11,228		7,354
13.125%, 11-15-27 (F)		847		551
				40,538
Diversified Support Services – 0.3%
Ahern Rentals, Inc., 7.375%, 5-15-23 (F)		3,901		1,873
Environmental & Facilities Services – 0.4%
GFL Environmental, Inc.:
7.000%, 6-1-26 (F)		1,975		2,054
8.500%, 5-1-27 (F)		572		622
Waste Pro USA, Inc., 5.500%, 2-15-26 (F)		482		460
				3,136
Security & Alarm Services – 0.2%
Prime Security Services Borrower LLC and Prime Finance, Inc., 6.250%, 1-15-28 (F)		2,132		2,008
Total Industrials – 6.1%				47,555
Information Technology
Application Software – 1.9%
Kronos Acquisition Holdings, Inc., 9.000%, 8-15-23 (F)		15,902		15,226
Data Processing & Outsourced Services – 0.2%
j2 Cloud Services LLC and j2 Global, Inc., 6.000%, 7-15-25 (F)		1,192		1,213
Electronic Equipment & Instruments – 0.4%
NCR Corp.:
8.125%, 4-15-25 (F)		1,183		1,254
5.750%, 9-1-27 (F)		755		755
6.125%, 9-1-29 (F)		966		971
				2,980

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
IT Consulting & Other Services – 0.1%
Sabre GLBL, Inc. (GTD by Sabre Holdings Corp.), 9.250%, 4-15-25 (F)	$	739	$	779
Total Information Technology – 2.6%				20,198
Materials
Aluminum – 1.0%
Constellium N.V.:
5.750%, 5-15-24 (F)		3,551		3,551
5.875%, 2-15-26 (F)		2,322		2,332
Constellium SE, 5.625%, 6-15-28 (F)		1,090		1,074
Novelis Corp. (GTD by Novelis, Inc.), 4.750%, 1-30-30 (F)		1,137		1,086
				8,043
Commodity Chemicals – 0.6%
NOVA Chemicals Corp.:
4.875%, 6-1-24 (F)		2,943		2,744
5.250%, 6-1-27 (F)		1,655		1,453
				4,197
Construction Materials – 0.7%
Hillman Group, Inc. (The), 6.375%, 7-15-22 (F)		5,883		5,430
Metal & Glass Containers – 0.4%
ARD Finance S.A. (6.500% Cash or 7.250% PIK),
6.500%, 6-30-27 (F)(I)		2,110		2,088
HudBay Minerals, Inc.:
7.250%, 1-15-23 (F)		408		402
7.625%, 1-15-25 (F)		611		585
				3,075
Total Materials – 2.7%				20,745
TOTAL CORPORATE DEBT SECURITIES – 66.4%			$	519,457
(Cost: $585,932)
LOANS (L)
Communication Services
Advertising – 0.4%
Advantage Sales & Marketing, Inc. (ICE LIBOR plus 325 bps),
4.250%, 7-25-21		786		715
Advantage Sales & Marketing, Inc. (ICE LIBOR plus 650 bps),
7.500%, 7-25-22		2,951		2,426
				3,141
Broadcasting – 0.7%
Clear Channel Outdoor Holdings, Inc. (ICE LIBOR plus 350 bps),
4.260%, 8-1-26		6,564		5,934

2020 SEMIANNUAL REPORT 29

SCHEDULE OF INVESTMENTS HIGH INCOME (in thousands)

JUNE 30, 2020 (UNAUDITED)

LOANS (L) (Continued)	Principal		Value
Integrated Telecommunication Services – 2.4%
Northwest Fiber LLC (ICE LIBOR plus 550 bps):
5.673%, 5-1-27 (B)	$	5,538	$	5,483
5.674%, 5-1-27 (B)		1,065		1,054
West Corp. (3-Month ICE LIBOR plus 400 bps),
5.000%, 10-10-24		14,442		12,269
				18,806
Publishing – 0.3%
Recorded Books, Inc. (ICE LIBOR plus 425 bps),
4.444%, 8-31-25		2,377		2,285
Wireless Telecommunication Service – 0.8%
Digicel International Finance Ltd. (ICE LIBOR plus 325 bps),
3.800%, 5-27-24		7,887		6,598
Total Communication Services – 4.6%				36,764
Consumer Discretionary
Apparel Retail – 0.5%
Talbots, Inc. (The) (ICE LIBOR plus 700 bps),
8.000%, 11-28-22		3,763		3,023
TRLG Intermediate Holdings LLC,
10.000%, 10-27-22 (H)		1,517		664
				3,687
Housewares & Specialties – 0.6%
KIK Custom Products, Inc. (ICE LIBOR plus 400 bps),
5.000%, 5-15-23		4,573		4,345
Leisure Facilities – 0.5%
United PF Holdings LLC (ICE LIBOR plus 400 bps),
4.308%, 1-6-27		3,473		3,062
United PF Holdings LLC (ICE LIBOR plus 850 bps),
9.500%, 12-30-26 (B)		943		943
				4,005
Restaurants – 0.1%
CEC Entertainment, Inc. (ICE LIBOR plus 650 bps),
9.572%, 8-30-26 (H)		1,774		993
NPC International, Inc. (ICE LIBOR plus 750 bps),
8.500%, 4-18-25		3,326		67
				1,060
Specialized Consumer Services – 0.3%
Asurion LLC (ICE LIBOR plus 600 bps),
6.678%, 8-4-25		1,861		1,847

LOANS (L) (Continued)	Principal		Value
Specialty Stores – 1.7%
Academy Sports + Outdoors (ICE LIBOR plus 400 bps),
5.000%, 7-2-22	$	3,142	$	2,509
Academy Sports + Outdoors (ICE LIBOR plus 500 bps),
0.000%, 7-2-22 (M)		1,122		896
Jo-Ann Stores, Inc. (ICE LIBOR plus 500 bps),
6.000%, 10-16-23		4,256		2,568
Jo-Ann Stores, Inc. (ICE LIBOR plus 925 bps),
10.250%, 5-21-24		3,971		1,390
Party City Holdings, Inc. (ICE LIBOR plus 250 bps):
3.250%, 8-19-22		58		27
4.100%, 8-19-22		1,690		798
Staples, Inc. (ICE LIBOR plus 500 bps),
5.687%, 4-12-26		6,030		5,171
				13,359
Textiles – 0.5%
SIWF Holdings, Inc. (ICE LIBOR plus 425 bps),
5.322%, 6-15-25		4,197		3,904
Total Consumer Discretionary – 4.2%				32,207
Energy
Coal & Consumable Fuels – 0.5%
Foresight Energy LLC (ICE LIBOR plus 725 bps),
7.363%, 3-28-22 (H)		6,950		417
Foresight Energy LLC (ICE LIBOR plus 800 bps),
8.300%, 6-29-27		1,564		1,564
Westmoreland Coal Co. (ICE LIBOR plus 650 bps),
9.250%, 3-15-22 (B)		463		416
Westmoreland Mining Holdings LLC (15.000% Cash or 15.000% PIK),
15.000%, 3-15-29 (B)(I)		2,015		1,209
				3,606
Oil & Gas Equipment & Services – 0.1%
Larchmont Resources LLC (8.000% Cash or 8.000% PIK),
8.000%, 8-7-20 (B)(E)(I)		757		379
Oil & Gas Exploration & Production – 0.1%
California Resources Corp. (ICE LIBOR plus 1,037.50 bps), 11.375%, 12-31-21		2,885		130
California Resources Corp. (ICE LIBOR plus 475 bps), 5.750%, 12-31-22		1,928		658
				788
Oil & Gas Storage & Transportation – 0.6%
EPIC Crude Services L.P. (ICE LIBOR plus 500 bps),
5.370%, 3-1-26		6,000		4,580

LOANS (L) (Continued)	Principal		Value
Oil & Gas Storage & Transportation (Continued)
Oryx Midstream Holdings LLC (ICE LIBOR plus 400 bps),
4.178%, 5-22-26	$	376	$	333
				4,913
Total Energy – 1.3%				9,686
Financials
Asset Management & Custody Banks – 0.5%
Edelman Financial Holdings II, Inc. (ICE LIBOR plus 675 bps),
6.930%, 7-20-26		4,048		3,676
Other Diversified Financial Services – 0.0%
New Cotai LLC (1-Month U.S. LIBOR plus 25 bps):
2.250%, 7-20-20		116		115
3.500%, 7-20-20		71		72
				187
Property & Casualty Insurance – 0.9%
Amynta Agency Borrower, Inc. (ICE LIBOR plus 400 bps),
4.678%, 2-28-25		8,330		7,185
Specialized Finance – 0.5%
Gulf Finance LLC (ICE LIBOR plus 525 bps),
6.250%, 8-25-23		6,032		3,860
Total Financials – 1.9%				14,908
Health Care
Health Care Equipment – 0.1%
LifeScan Global Corp. (3-Month ICE LIBOR plus 950 bps), 10.675%, 10-1-25		632		441
Health Care Facilities – 0.4%
Surgery Center Holdings, Inc. (ICE LIBOR plus 325 bps), 4.250%, 8-31-24		3,270		2,860
Surgery Center Holdings, Inc. (ICE LIBOR plus 800 bps), 9.000%, 8-31-24		337		337
				3,197
Health Care Services – 2.4%
Heartland Dental LLC,
0.000%, 4-30-25 (M)		541		480
Heartland Dental LLC (ICE LIBOR plus 375 bps),
3.678%, 4-30-25		6,251		5,545
LifePoint Health, Inc. (ICE LIBOR plus 375 bps),
3.928%, 11-16-25		2,507		2,344
U.S. Renal Care, Inc. (3-Month ICE LIBOR plus 500 bps),
5.178%, 6-26-26		10,608		10,182
				18,551

30 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS HIGH INCOME (in thousands)

JUNE 30, 2020 (UNAUDITED)

LOANS (L) (Continued)	Principal		Value
Health Care Technology – 0.9%
Verscend Holding Corp. (ICE LIBOR plus 450 bps),
4.678%, 8-27-25	$	6,843	$	6,598
Pharmaceuticals – 0.2%
Advanz Pharma Corp. Ltd.,
0.000%, 9-6-24 (M)		300		277
Concordia International Corp. (ICE LIBOR plus 550 bps),
6.500%, 9-6-24		1,146		1,059
Endo Luxembourg Finance Co. I S.a.r.l. (ICE LIBOR plus 425 bps),
5.000%, 4-27-24		736		694
				2,030
Total Health Care – 4.0%				30,817
Industrials
Building Products – 0.1%
Hampton Rubber Co. & SEI Holding Corp. (ICE LIBOR plus 800 bps),
9.072%, 3-27-22		1,074		852
Construction & Engineering – 0.7%
McDermott Technology Americas, Inc.,
0.000%, 10-21-20 (M)		446		442
McDermott Technology Americas, Inc. (ICE LIBOR plus 500 bps):
0.000%, 5-10-25 (H)(M)		3,050		1,046
9.250%, 5-10-25 (H)		5,530		1,898
McDermott Technology Americas, Inc. (ICE LIBOR plus 900 bps),
10.000%, 10-21-20		1,409		1,397
Tensar International Corp. (ICE LIBOR plus 850 bps),
9.500%, 7-10-22		1,119		839
				5,622
Diversified Support Services – 0.0%
Creative Artists Agency LLC (ICE LIBOR plus 375 bps),
3.928%, 11-26-26		262		247
Industrial Conglomerates – 0.6%
PAE Holding Corp. (ICE LIBOR plus 550 bps), 6.500%, 10-20-22 (B)		4,824		4,655

LOANS (L) (Continued)	Principal		Value
Industrial Conglomerates (Continued)
PAE Holding Corp. (ICE LIBOR plus 950 bps), 10.500%, 10-20-23 (B)	$	387	$	374
				5,029
Industrial Machinery – 1.2%
Form Technologies LLC (ICE LIBOR plus 325 bps),
4.700%, 1-28-22		2,341		1,896
Form Technologies LLC (ICE LIBOR plus 850 bps),
9.500%, 1-30-23		13,354		7,300
				9,196
Total Industrials – 2.6%				20,946
Information Technology
Application Software – 0.6%
Applied Systems, Inc. (ICE LIBOR plus 700 bps),
8.000%, 9-19-25		1,954		1,944
Kronos Acquisition Holdings, Inc. (ICE LIBOR plus 700 bps),
8.000%, 5-15-23 (B)		528		518
Ultimate Software Group, Inc. (The):
0.000%, 5-3-26 (M)		1,404		1,385
0.000%, 5-3-27 (M)		744		755
				4,602
Communications Equipment – 1.1%
MLN U.S. Holdco LLC (ICE LIBOR plus 450 bps),
4.678%, 11-30-25		8,740		7,107
MLN U.S. Holdco LLC (ICE LIBOR plus 875 bps),
8.928%, 11-30-26		2,920		1,498
				8,605
Data Processing & Outsourced Services – 1.3%
Cardtronics USA, Inc.,
0.000%, 6-24-27 (B)(M)		2,387		2,339
CommerceHub, Inc. (ICE LIBOR plus 375 bps),
3.678%, 5-21-25 (B)		3,129		2,988
Cyxtera DC Holdings, Inc. (ICE LIBOR plus 300 bps),
8.250%, 5-1-25		3,429		1,195
Cyxtera DC Holdings, Inc. (ICE LIBOR plus 325 bps),
3.630%, 5-1-24		5,284		3,971
				10,493

LOANS (L) (Continued)	Principal		Value
Internet Services & Infrastructure – 0.5%
Informatica LLC,
7.125%, 2-14-25	$	3,776	$	3,771
Total Information Technology – 3.5%				27,471
Materials
Construction Materials – 0.7%
Hillman Group, Inc. (The),
0.000%, 5-31-25 (M)		736		688
Hillman Group, Inc. (The) (ICE LIBOR plus 350 bps),
5.072%, 5-31-25		5,248		4,907
				5,595
Total Materials – 0.7%				5,595
TOTAL LOANS – 22.8%			$	178,394
(Cost: $226,553)
SHORT-TERM SECURITIES	Shares
Money Market Funds (O) – 7.1%
Dreyfus Institutional Preferred Government Money Market Fund – Institutional Shares, 0.100% (N)		3,889		3,889
State Street Institutional U.S. Government Money Market Fund – Premier Class, 0.120%		51,908		51,908
				55,797
TOTAL SHORT-TERM SECURITIES – 7.1%			$	55,797
(Cost: $55,797)
TOTAL INVESTMENT SECURITIES – 102.7%			$	804,501
(Cost: $925,523)
LIABILITIES, NET OF CASH AND OTHER ASSETS – (2.7)%				(21,161	)
NET ASSETS – 100.0%			$	783,340

Notes to Schedule of Investments

* Not shown due to rounding.

(A) No dividends were paid during the preceding 12 months.

(B) Securities whose value was determined using significant unobservable inputs.

2020 SEMIANNUAL REPORT 31

SCHEDULE OF INVESTMENTS HIGH INCOME (in thousands)

JUNE 30, 2020 (UNAUDITED)

(C) Restricted securities. At June 30, 2020, the Portfolio owned the following restricted securities:

Security	Acquisition Date(s)		Shares			Cost		Value
ASG Warrant Corp.		5-31-18		1		$	72	$	—
BIS Industries Ltd.		12-22-17		1,605			151		—	*
Larchmont Resources LLC		12-8-16		1			340		45
New Cotai Participation Corp., Class B		4-12-13		—	*		62		—
Sabine Oil & Gas Corp.		12-7-16		—	*		12		4
Pinnacle Agriculture Enterprises LLC		3-10-17		4,583			2,083		—	*
Targa Resources Corp., 9.500%		10-24-17		8			8,416		7,833
						$	11,136	$	7,882

The total value of these securities represented 1.0% of net assets at June 30, 2020.

(D) Listed on an exchange outside the United States.

(E) Deemed to be an affiliate due to the Portfolio owning at least 5% of the voting securities.

(F) Securities were purchased pursuant to an exemption from registration available under Rule 144A under the Securities Act of 1933 and may only be resold in transactions exempt from registration, normally to qualified institutional buyers. At June 30, 2020 the total value of these securities amounted to $455,093 or 58.1% of net assets.

(G) Warrants entitle the Portfolio to purchase a predetermined number of shares of common stock and are non-income producing. The purchase price and number of shares are subject to adjustment under certain conditions until the expiration date, if any.

(H) Non-income producing as the issuer has either missed its most recent interest payment or declared bankruptcy.

(I) Payment-in-kind bond which may pay interest in additional par and/or in cash. Rates shown are the current rate and possible payment rates.

(J) Step bond that pays an initial coupon rate for the first period and then a higher or lower coupon rate for the following periods. Interest rate disclosed is that which is in effect at June 30, 2020.

(K) All or a portion of securities with an aggregate value of $3,802 are on loan.

(L) Variable rate security. Interest rate disclosed is that which is in effect at June 30, 2020. Description of the reference rate and spread, if applicable, are included in the security description.

(M) All or a portion of this position has not settled. Full contract rates do not take effect until settlement date.

(N) Investment made with cash collateral received from securities on loan.

(O) Rate shown is the annualized 7-day yield at June 30, 2020.

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Common Stocks
Consumer Discretionary	$	9,867	$	—	$	—	*
Energy		—		272		49
Health Care		—		105		—
Industrials		—		—		—	*
Total Common Stocks	$	9,867	$	377	$	49
Investment Funds		32,726		—		—
Preferred Stocks		—		7,833		—	*
Warrants		—		—		1
Corporate Debt Securities		—		519,457		—
Loans		—		158,036		20,358
Short-Term Securities		55,797		—		—
Total	$	98,390	$	685,703	$	20,408

32 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS HIGH INCOME (in thousands)

JUNE 30, 2020 (UNAUDITED)

The following table is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Common Stocks			Preferred Stocks			Warrants		Corporate Debt Securities			Loans
Beginning Balance 1-1-20	$	350		$	—	*	$	—	$	2,640		$	20,995
Net realized gain (loss)		—			—			—		(2,522	)		9
Net change in unrealized appreciation (depreciation)		(315	)		—			—		3,961			(731	)
Purchases		—			—			—		—			11,384
Sales		—			—			—		(4,079	)		(5,654	)
Amortization/Accretion of premium/discount		—			—			—		—			(95	)
Transfers into Level 3 during the period		14			—			1		—			10,265
Transfers out of Level 3 during the period		—			—			—		—			(15,815	)
Ending Balance 6-30-20	$	49		$	—	*	$	1	$	—		$	20,358
Net change in unrealized appreciation (depreciation) for all Level 3 investments still held as of 6-30-20	$	(315	)	$	—		$	—	$	—		$	(696	)

Transfers from Level 2 to Level 3 occurred primarily due to the lack of observable market data due to decreased market activity or information for these securities. Transfers from Level 3 to Level 2 occurred primarily due to the increased availability of observable market data due to increased market activity or information.

Information about Level 3 fair value measurements:

	Fair Value at 6-30-20			Valuation Technique(s)	Unobservable Input(s)	Input value(s)
Assets
Common Stocks	$	49		Third-party valuation service	Broker quote		N/A
		—	*	Market comparable approach	Adjusted EBITDA multiple		4.03X
Preferred Stocks		—	*	Transaction	Price		$0
Warrants		1		Third-party valuation service	Broker quote		N/A
Loans		20,358		Third-party valuation service	Broker quotes		N/A

Significant increases (decreases) in the adjusted EBITDA multiple inputs as of the reporting date would result in a higher (lower) fair value measurement.

The following acronyms are used throughout this schedule:

ADR = American Depositary Receipts

ETF = Exchange Traded Fund

GTD = Guaranteed

ICE = Intercontinental Exchange

PIK = Payment In Kind

LIBOR = London Interbank Offered Rate

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 33

PORTFOLIO HIGHLIGHTS INTERNATIONAL CORE EQUITY

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Stocks	96.6%
Health Care	14.5%
Industrials	14.1%
Consumer Staples	12.6%
Financials	12.5%
Consumer Discretionary	12.0%
Materials	8.4%
Information Technology	7.1%
Energy	6.5%
Communication Services	5.1%
Real Estate	2.3%
Utilities	1.5%
Bonds	1.0%
Other Government Securities	1.0%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	2.4%

Country Weightings

Europe	63.0%
Germany	15.0%
France	14.1%
United Kingdom	12.4%
Switzerland	7.5%
Norway	4.1%
Netherlands	4.1%
Other Europe	5.8%
Pacific Basin	28.6%
Japan	14.3%
Australia	4.9%
Hong Kong	3.6%
Other Pacific Basin	5.8%
North America	6.0%
Canada	4.2%
Other North America	1.8%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	2.4%

Top 10 Equity Holdings

Company	Country	Sector	Industry
Roche Holdings AG, Genusscheine	Switzerland	Health Care	Pharmaceuticals
Nestle S.A., Registered Shares	Switzerland	Consumer Staples	Packaged Foods & Meats
SAP AG	Germany	Information Technology	Application Software
Newcrest Mining Ltd.	Australia	Materials	Gold
DNB ASA	Norway	Financials	Diversified Banks
Legal & General Group plc	United Kingdom	Financials	Life & Health Insurance
Airbus SE	France	Industrials	Aerospace & Defense
Merck KGaA	Germany	Health Care	Pharmaceuticals
SPDR Gold Trust	United States	Materials	Gold
Anglo American plc	United Kingdom	Materials	Diversified Metals & Mining

See your advisor or www.ivyinvestments.com for more information on the Portfolio’s most recently published Top 10 Equity Holdings.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

34 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS INTERNATIONAL CORE EQUITY (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS	Shares		Value
Australia
Financials – 1.1%
Australia and New Zealand Banking Group Ltd.		519	$	6,735
Materials – 3.8%
BHP Group plc		285		5,841
BHP Group plc ADR		116		4,770
Newcrest Mining Ltd.		527		11,679
				22,290
Total Australia – 4.9%			$	29,025
Canada
Consumer Discretionary – 1.2%
Dollarama, Inc.		203		6,759
Energy – 3.0%
Canadian Natural Resources Ltd.		426		7,409
Seven Generations Energy Ltd., Class A (A)		1,583		3,532
Suncor Energy, Inc.		367		6,193
				17,134
Total Canada – 4.2%			$	23,893
China
Consumer Discretionary – 1.2%
Gree Electric Appliances, Inc. of Zhuhai, A Shares		874		7,019
Consumer Staples – 1.1%
Wens Foodstuffs Group Co. Ltd., Class A		1,991		6,162
Total China – 2.3%			$	13,181
Denmark
Health Care – 1.3%
Novo Nordisk A/S ADR		28		1,834
Novo Nordisk A/S, Class B		87		5,641
				7,475
Industrials – 1.4%
A.P. Moller - Maersk A/S		5		6,439
A.P. Moller - Maersk A/S, Class A		2		1,830
				8,269
Total Denmark – 2.7%			$	15,744
France
Communication Services – 2.4%
Orange S.A.		544		6,508
Ubisoft Entertainment S.A. (A)		88		7,307
				13,815
Consumer Staples – 2.3%
Carrefour S.A. (B)		444		6,892
Pernod Ricard S.A.		41		6,500
				13,392

COMMON STOCKS (Continued)	Shares		Value
Energy – 1.6%
Total S.A. (B)		241	$	9,302
Financials – 1.1%
BNP Paribas S.A.		161		6,445
Industrials – 3.6%
Airbus SE		157		11,248
Schneider Electric S.A.		86		9,598
				20,846
Information Technology – 1.6%
Cap Gemini S.A.		79		9,081
Utilities – 1.5%
ENGIE		714		8,849
Total France – 14.1%			$	81,730
Germany
Communication Services – 0.6%
Deutsche Telekom AG, Registered Shares		218		3,653
Consumer Discretionary – 2.3%
adidas AG		24		6,312
Continental AG		71		6,951
				13,263
Consumer Staples – 1.2%
Beiersdorf Aktiengesellschaft		60		6,793
Financials – 1.2%
Munchener Ruckversicherungs-Gesellschaft AG, Registered Shares		26		6,707
Health Care – 4.8%
Bayer AG		114		8,463
Fresenius Medical Care AG & Co. KGaA (A)		103		8,858
Merck KGaA		89		10,343
				27,664
Industrials – 1.2%
Hochtief Aktiengesellschaft		78		6,976
Information Technology – 2.5%
SAP AG		105		14,661
Real Estate – 1.2%
Deutsche Wohnen AG		150		6,747
Total Germany – 15.0%			$	86,464
Hong Kong
Consumer Discretionary – 1.3%
Alibaba Group Holding Ltd. (A)		276		7,441

COMMON STOCKS (Continued)	Shares		Value
Financials – 2.3%
AIA Group Ltd.		596	$	5,577
Hong Kong Exchanges and Clearing Ltd.		179		7,604
				13,181
Total Hong Kong – 3.6%			$	20,622
India
Energy – 1.1%
Reliance Industries Ltd.		290		6,374
Total India – 1.1%			$	6,374
Ireland
Materials – 1.0%
CRH plc		173		5,924
Total Ireland – 1.0%			$	5,924
Japan
Communication Services – 0.5%
Dentsu Group, Inc. (B)		129		3,062
Consumer Discretionary – 4.4%
Isuzu Motors Ltd.		818		7,435
Subaru Corp.		481		10,062
Zozo, Inc.		377		8,409
				25,906
Consumer Staples – 2.8%
Asahi Breweries Ltd. (B)		184		6,470
Seven & i Holdings Co. Ltd.		306		9,997
				16,467
Financials – 1.1%
ORIX Corp.		490		6,083
Health Care – 1.1%
Terumo Corp.		168		6,383
Industrials – 2.8%
SMC Corp.		18		9,353
Taisei Corp.		191		6,947
				16,300
Information Technology – 0.5%
Shimadzu Corp.		119		3,182
Real Estate – 1.1%
Mitsubishi Estate Co. Ltd.		426		6,354
Total Japan – 14.3%			$	83,737
Luxembourg
Energy – 0.8%
Tenaris S.A.		375		2,440
Tenaris S.A. ADR		180		2,329
				4,769
Total Luxembourg – 0.8%			$	4,769

2020 SEMIANNUAL REPORT 35

SCHEDULE OF INVESTMENTS INTERNATIONAL CORE EQUITY (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS (Continued)	Shares		Value
Netherlands
Consumer Discretionary – 1.6%
Prosus N.V. (A)		98	$	9,095
Health Care – 1.3%
Koninklijke Philips Electronics N.V., Ordinary Shares		160		7,442
Industrials – 1.2%
Randstad Holding N.V.		160		7,166
Total Netherlands – 4.1%			$	23,703
Norway
Consumer Staples – 1.1%
Mowi ASA		333		6,349
Financials – 2.0%
DNB ASA (A)		860		11,482
Total Norway – 3.1%			$	17,831
Singapore
Communication Services – 0.9%
Singapore Telecommunications Ltd.		2,868		5,102
Total Singapore – 0.9%			$	5,102
South Korea
Information Technology – 1.5%
Samsung Electronics Co. Ltd.		191		8,453
Total South Korea – 1.5%			$	8,453
Sweden
Industrials – 1.3%
Epiroc AB, Class A		473		5,926
Epiroc AB, Class B		129		1,587
				7,513
Total Sweden – 1.3%			$	7,513

COMMON STOCKS (Continued)	Shares		Value
Switzerland
Consumer Staples – 2.5%
Nestle S.A., Registered Shares		133	$	14,772
Health Care – 3.5%
Alcon, Inc.		98		5,637
Roche Holdings AG, Genusscheine		43		14,798
				20,435
Industrials – 1.5%
Ferguson plc		104		8,508
Total Switzerland – 7.5%			$	43,715
United Kingdom
Communication Services – 0.7%
WPP Group plc		486		3,790
Consumer Staples – 1.6%
British American Tobacco plc		246		9,434
Financials – 3.7%
Legal & General Group plc		4,138		11,282
Lloyds Banking Group plc		7,226		2,787
Prudential plc		516		7,778
				21,847
Health Care – 2.5%
GlaxoSmithKline plc		458		9,255
GlaxoSmithKline plc ADR		131		5,330
				14,585
Industrials – 1.1%
BAE Systems plc		1,032		6,171
Information Technology – 1.0%
Amdocs Ltd.		98		5,986
Materials – 1.8%
Anglo American plc		439		10,128
Total United Kingdom – 12.4%			$	71,941
TOTAL COMMON STOCKS – 94.8%			$	549,721
(Cost: $587,554)

INVESTMENT FUNDS	Shares		Value
United States – 1.8%
SPDR Gold Trust (A)		62	$	10,334
TOTAL INVESTMENT FUNDS – 1.8%			$	10,334
(Cost: $7,858)
OTHER GOVERNMENT SECURITIES (C)	Principal
Norway – 1.0%
Norway Government Bond
3.750%, 5-25-21 (D)(E)		NOK54,170		5,811
TOTAL OTHER GOVERNMENT SECURITIES – 1.0%			$	5,811
(Cost: $6,210)
SHORT-TERM SECURITIES	Shares
Money Market Funds (F) – 4.9%
State Street Institutional U.S. Government Money Market Fund – Premier Class 0.120%		12,633		12,633
Dreyfus Institutional Preferred Government Money Market Fund – Institutional Shares 0.100% (G)		15,859		15,859
				28,492
TOTAL SHORT-TERM SECURITIES – 4.9%			$	28,492
(Cost: $28,492)
TOTAL INVESTMENT SECURITIES – 102.5%			$	594,358
(Cost: $630,114)
LIABILITIES, NET OF CASH AND OTHER ASSETS – (2.5)%				(14,372	)
NET ASSETS – 100.0%			$	579,986

Notes to Schedule of Investments

(A) No dividends were paid during the preceding 12 months.

(B) All or a portion of securities with an aggregate value of $20,376 are on loan.

(C) Other Government Securities may include emerging markets sovereign, quasi-sovereign, corporate and supranational agency and organization debt securities.

(D) Principal amounts are denominated in the indicated foreign currency, where applicable (NOK—Norwegian Krone).

(E) Securities were purchased pursuant to an exemption from registration available under Rule 144A under the Securities Act of 1933 and may only be resold in transactions exempt from registration, normally to qualified institutional buyers. At June 30, 2020 the total value of these securities amounted to $5,811 or 1.0% of net assets.

(F) Rate shown is the annualized 7-day yield at June 30, 2020.

(G) Investment made with cash collateral received from securities on loan.

36 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS INTERNATIONAL CORE EQUITY (in thousands)

JUNE 30, 2020 (UNAUDITED)

The following forward foreign currency contracts were outstanding at June 30, 2020:

	Currency to be Delivered			Currency to be Received		Settlement Date		Counterparty	Unrealized Appreciation		Unrealized Depreciation
U.S. Dollar		34,745	Japanese Yen		3,766,940		7-14-20	Deutsche Bank AG	$	148	$	—

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Common Stocks
Communication Services	$	—	$	29,422	$	—
Consumer Discretionary		15,854		53,629		—
Consumer Staples		—		73,369		—
Energy		19,651		17,928		—
Financials		—		72,480		—
Health Care		15,881		68,103		—
Industrials		—		81,749		—
Information Technology		5,986		35,377		—
Materials		4,770		33,572		—
Real Estate		—		13,101		—
Utilities		—		8,849		—
Total Common Stocks	$	62,142	$	487,579	$	—
Investment Funds		10,334		—		—
Other Government Securities		—		5,811		—
Short-Term Securities		28,492		—		—
Total	$	100,968	$	493,390	$	—
Forward Foreign Currency Contracts	$	—	$	148	$	—

The following acronym is used throughout this schedule:

ADR = American Depositary Receipts

Market Sector Diversification

(as a % of net assets)
Health Care	14.5%
Industrials	14.1%
Financials	12.6%
Consumer Staples	12.5%
Consumer Discretionary	12.0%
Materials	8.4%
Information Technology	7.1%

Market Sector Diversification (Continued)

Energy	6.5%
Communication Services	5.1%
Real Estate	2.3%
Utilities	1.5%
Other Government Securities	1.0%
Other+	2.4%

+Includes liabilities (net of cash and other assets), and cash equivalents

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 37

PORTFOLIO HIGHLIGHTS MID CAP GROWTH

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Stocks	100.1%
Information Technology	34.2%
Health Care	20.9%
Industrials	16.8%
Consumer Discretionary	12.6%
Financials	6.3%
Communication Services	4.2%
Materials	3.0%
Consumer Staples	1.3%
Energy	0.8%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	-0.1%

Top 10 Equity Holdings

Company	Sector	Industry
Chipotle Mexican Grill, Inc., Class A	Consumer Discretionary	Restaurants
CoStar Group, Inc.	Industrials	Research & Consulting Services
Electronic Arts, Inc.	Communication Services	Interactive Home Entertainment
MarketAxess Holdings, Inc.	Financials	Financial Exchanges & Data
DexCom, Inc.	Health Care	Health Care Equipment
Teradyne, Inc.	Information Technology	Semiconductor Equipment
Square, Inc., Class A	Information Technology	Data Processing & Outsourced Services
Twilio, Inc., Class A	Information Technology	Internet Services & Infrastructure
DocuSign, Inc.	Information Technology	Application Software
Fastenal Co.	Industrials	Trading Companies & Distributors

See your advisor or www.ivyinvestments.com for more information on the Portfolio’s most recently published Top 10 Equity Holdings.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

38 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS MID CAP GROWTH (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS	Shares		Value
Communication Services
Interactive Home Entertainment – 3.2%
Electronic Arts, Inc. (A)		131	$	17,291
Interactive Media & Services – 1.0%
Twitter, Inc. (A)		176		5,241
Total Communication Services – 4.2%				22,532
Consumer Discretionary
Apparel, Accessories & Luxury Goods – 1.4%
lululemon athletica, Inc. (A)		24		7,622
Auto Parts & Equipment – 1.4%
BorgWarner, Inc.		221		7,808
Department Stores – 0.7%
Nordstrom, Inc. (B)		227		3,516
General Merchandise Stores – 0.6%
Ollie’s Bargain Outlet Holdings, Inc. (A)		32		3,111
Internet & Direct Marketing Retail – 1.2%
MercadoLibre, Inc. (A)		7		6,513
Restaurants – 3.6%
Chipotle Mexican Grill, Inc., Class A (A)		18		19,299
Specialty Stores – 3.7%
Tractor Supply Co.		87		11,460
Ulta Beauty, Inc. (A)		41		8,322
				19,782
Total Consumer Discretionary – 12.6%				67,651
Consumer Staples
Packaged Foods & Meats – 1.3%
Hershey Foods Corp.		52		6,740
Total Consumer Staples – 1.3%				6,740
Energy
Oil & Gas Exploration & Production – 0.8%
Noble Energy, Inc.		500		4,482
Total Energy – 0.8%				4,482
Financials
Financial Exchanges & Data – 3.2%
MarketAxess Holdings, Inc.		34		17,060
Regional Banks – 3.1%
First Republic Bank		87		9,187
SVB Financial Group (A)		35		7,532
				16,719
Total Financials – 6.3%				33,779

COMMON STOCKS (Continued)	Shares		Value
Health Care
Biotechnology – 3.3%
Genmab A.S. ADR (A)		186	$	6,306
Seattle Genetics, Inc. (A)		66		11,280
				17,586
Health Care Equipment – 8.7%
Abiomed, Inc. (A)		38		9,226
DexCom, Inc. (A)		41		16,484
Edwards Lifesciences Corp. (A)		136		9,409
Glaukos Corp. (A)		90		3,468
Intuitive Surgical, Inc. (A)		15		8,355
				46,942
Health Care Services – 2.7%
Laboratory Corp. of America Holdings (A)		47		7,745
Teladoc Health, Inc. (A)		35		6,743
				14,488
Health Care Supplies – 1.6%
Align Technology, Inc. (A)		12		3,267
National Vision Holdings, Inc. (A)		169		5,143
				8,410
Health Care Technology – 1.8%
Cerner Corp.		142		9,754
Life Sciences Tools & Services – 2.8%
10x Genomics, Inc., Class A (A)		29		2,607
Agilent Technologies, Inc.		82		7,236
TECHNE Corp.		21		5,500
				15,343
Total Health Care – 20.9%				112,523
Industrials
Building Products – 4.4%
A. O. Smith Corp.		192		9,035
Trane Technologies plc		52		4,596
Trex Co., Inc. (A)		77		10,060
				23,691
Industrial Machinery – 3.9%
IDEX Corp.		54		8,609
Ingersoll-Rand, Inc. (A)		182		5,108
Middleby Corp. (A)		91		7,201
				20,918
Research & Consulting Services – 5.9%
CoStar Group, Inc. (A)		26		18,775
TransUnion		151		13,104
				31,879
Trading Companies & Distributors – 2.6%
Fastenal Co.		324		13,880
Total Industrials – 16.8%				90,368

COMMON STOCKS (Continued)	Shares		Value
Information Technology
Application Software – 7.3%
DocuSign, Inc. (A)		82	$	14,196
Guidewire Software, Inc. (A)		94		10,416
Tyler Technologies, Inc. (A)		26		9,100
Zendesk, Inc. (A)		61		5,368
				39,080
Communications Equipment – 1.4%
Arista Networks, Inc. (A)		36		7,527
Data Processing & Outsourced Services – 2.7%
Square, Inc., Class A (A)		136		14,301
Electronic Components – 2.9%
II-VI, Inc. (A)		107		5,074
Maxim Integrated Products, Inc.		176		10,645
				15,719
Electronic Equipment & Instruments – 3.8%
Coherent, Inc. (A)		40		5,270
Keysight Technologies, Inc. (A)		117		11,790
Novanta, Inc. (A)		33		3,550
				20,610
Internet Services & Infrastructure – 3.4%
Twilio, Inc., Class A (A)		65		14,296
VeriSign, Inc. (A)		19		4,030
				18,326
Semiconductor Equipment – 3.4%
Brooks Automation, Inc.		79		3,503
Teradyne, Inc.		177		14,994
				18,497
Semiconductors – 7.3%
Advanced Micro Devices, Inc. (A)		188		9,877
Microchip Technology, Inc.		101		10,660
Monolithic Power Systems, Inc.		53		12,637
Universal Display Corp.		40		5,911
				39,085
Systems Software – 2.0%
CrowdStrike Holdings, Inc., Class A (A)		50		5,040
Palo Alto Networks, Inc. (A)		24		5,404
				10,444
Total Information Technology – 34.2%				183,589
Materials
Fertilizers & Agricultural Chemicals – 1.4%
Scotts Miracle-Gro Co. (The)		58		7,764
Specialty Chemicals – 1.6%
RPM International, Inc.		113		8,465
Total Materials – 3.0%				16,229
TOTAL COMMON STOCKS – 100.1%			$	537,893
(Cost: $370,914)

2020 SEMIANNUAL REPORT 39

SCHEDULE OF INVESTMENTS MID CAP GROWTH (in thousands)

JUNE 30, 2020 (UNAUDITED)

SHORT-TERM SECURITIES	Shares		Value
Money Market Funds (D) – 1.6%
Dreyfus Institutional Preferred Government Money Market Fund – Institutional Shares, 0.100% (C)		3,497	$	3,497
State Street Institutional U.S. Government Money Market Fund – Premier Class,
0.120%		5,186		5,186
				8,683
TOTAL SHORT-TERM SECURITIES – 1.6%			$	8,683
(Cost: $8,683)
TOTAL INVESTMENT SECURITIES – 101.7%			$	546,576
(Cost: $379,597)
LIABILITIES, NET OF CASH AND OTHER ASSETS – (1.7)%				(9,163	)
NET ASSETS – 100.0%			$	537,413

Notes to Schedule of Investments

(A) No dividends were paid during the preceding 12 months.

(B) All or a portion of securities with an aggregate value of $3,419 are on loan.

(C) Investment made with cash collateral received from securities on loan.

(D) Rate shown is the annualized 7-day yield at June 30, 2020.

The following written options were outstanding at June 30, 2020 (contracts and exercise prices unrounded):

Underlying Security	Counterparty, if OTC	Type	Number of Contracts		Notional Amount	Expiration Month		Exercise Price		Premium Received		Value
Align Technology, Inc.	N/A	Put		45	5		July 2020	$	210.00	$	33	$	(3)
Middleby Corp.	N/A	Put		193	19		July 2020		55.00		29		(7)
National Vision Holdings, Inc.	N/A	Put		476	48		July 2020		25.00		49		(11)
Nordstrom, Inc.	N/A	Put		1,032	103		July 2020		12.50		57		(20)
Square, Inc., Class A	N/A	Call		712	71		July 2020		95.00		118		(819)
Teladoc Health, Inc.	N/A	Call		353	35		July 2020		210.00		118		(101)
Twilio, Inc., Class A	N/A	Call		325	33		July 2020		230.00		130		(161)
										$	534	$	(1,122)

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Common Stocks	$	537,893	$	—	$	—
Short-Term Securities		8,683		—		—
Total	$	546,576	$	—	$	—
Liabilities
Written Options	$	1,101	$	21	$	—

The following acronyms are used throughout this schedule:

ADR = American Depositary Receipts

OTC = Over the Counter

See Accompanying Notes to Financial Statements.

40 SEMIANNUAL REPORT 2020

PORTFOLIO HIGHLIGHTS NATURAL RESOURCES

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Stocks	95.3%
Materials	49.4%
Energy	29.1%
Industrials	8.5%
Utilities	4.3%
Consumer Staples	3.4%
Information Technology	0.6%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	4.7%

Country Weightings

North America	75.8	%
United States	55.4	%
Canada	20.4	%
Europe	10.6	%
United Kingdom	4.4	%
France	4.2	%
Other Europe	2.0	%
Pacific Basin	5.5	%
Other	3.4	%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	4.7	%

Top 10 Equity Holdings

Company	Country	Sector	Industry
Barrick Gold Corp.	Canada	Materials	Gold
Phillips 66	United States	Energy	Oil & Gas Refining & Marketing
Agnico-Eagle Mines Ltd.	Canada	Materials	Gold
Franco-Nevada Corp.	Canada	Materials	Gold
Valero Energy Corp.	United States	Energy	Oil & Gas Refining & Marketing
Wheaton Precious Metals Corp.	Canada	Materials	Precious Metals & Minerals
Canadian Pacific Railway Ltd.	Canada	Industrials	Railroads
Union Pacific Corp.	United States	Industrials	Railroads
BHP Group plc	Australia	Materials	Diversified Metals & Mining
Rio Tinto plc	United Kingdom	Materials	Diversified Metals & Mining

See your advisor or www.ivyinvestments.com for more information on the Portfolio’s most recently published Top 10 Equity Holdings.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

2020 SEMIANNUAL REPORT 41

SCHEDULE OF INVESTMENTS NATURAL RESOURCES (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS	Shares		Value
Australia
Materials – 2.9%
BHP Group plc		99	$	2,022
Total Australia – 2.9%			$	2,022
Canada
Industrials – 3.0%
Canadian Pacific Railway Ltd.		8		2,121
Materials – 17.4%
Agnico-Eagle Mines Ltd.		40		2,577
Barrick Gold Corp.		189		5,102
Franco-Nevada Corp.		16		2,277
Wheaton Precious Metals Corp.		48		2,126
				12,082
Total Canada – 20.4%			$	14,203
France
Energy – 2.1%
Total S.A. ADR		38		1,472
Materials – 2.1%
L Air Liquide S.A.		10		1,468
Total France – 4.2%			$	2,940
Hong Kong
Materials – 0.0%
China Metal Recycling (Holdings) Ltd. (A)(B)		1,900		—	*
Total Hong Kong – 0.0%			$	—	*
India
Energy – 2.6%
Reliance Industries Ltd.		81		1,776
Total India – 2.6%			$	1,776

COMMON STOCKS (Continued)	Shares		Value
Portugal
Energy – 2.0%
Galp Energia SGPS S.A., Class B		118	$	1,371
Total Portugal – 2.0%			$	1,371
South Africa
Materials – 3.4%
AngloGold Ashanti Ltd. ADR		45	$	1,322
Mondi plc		57		1,059
				2,381
Total South Africa – 3.4%			$	2,381
United Kingdom
Materials – 4.4%
Croda International plc		16		1,062
Rio Tinto plc		36		2,002
				3,064
Total United Kingdom – 4.4%			$	3,064
United States
Consumer Staples – 3.4%
Bunge Ltd.		27		1,126
Tyson Foods, Inc.		21		1,236
				2,362
Energy – 22.4%
Cabot Oil & Gas Corp.		78		1,336
Chevron Corp.		14		1,278
Concho Resources, Inc.		20		1,013
Diamondback Energy, Inc.		15		637
Enterprise Products Partners L.P.		46		841
EOG Resources, Inc.		27		1,360
Magellan Midstream Partners L.P.		29		1,244
Marathon Petroleum Corp.		49		1,844
Parsley Energy, Inc., Class A		36		385
Phillips 66		43		3,059
Valero Energy Corp.		37		2,185
WPX Energy, Inc. (A)		67		425
				15,607
Industrials – 5.5%
Union Pacific Corp.		12		2,054
Waste Management, Inc.		17		1,769
				3,823

COMMON STOCKS (Continued)	Shares		Value
Information Technology – 0.6%
Enphase Energy, Inc. (A)		9	$	425
Materials – 19.2%
Air Products and Chemicals, Inc.		7		1,747
Albemarle Corp.		5		372
Avery Dennison Corp.		11		1,261
Ball Corp.		19		1,328
FMC Corp.		12		1,165
Graphic Packaging Holding Co.		80		1,121
Packaging Corp. of America		16		1,637
PPG Industries, Inc.		13		1,430
Sherwin-Williams Co. (The)		3		1,731
Southern Copper Corp.		39		1,566
				13,358
Utilities – 4.3%
Atmos Energy Corp.		14		1,381
NextEra Energy, Inc.		7		1,605
				2,986
Total United States – 55.4%			$	38,561
TOTAL COMMON STOCKS – 95.3%			$	66,318
(Cost: $77,054)
SHORT-TERM SECURITIES
Money Market Funds (C) – 4.9%
State Street Institutional U.S. Government Money Market Fund – Premier Class 0.120%		3,385		3,385
TOTAL SHORT-TERM SECURITIES – 4.9%			$	3,385
(Cost: $3,385)
TOTAL INVESTMENT SECURITIES – 100.2%			$	69,703
(Cost: $80,439)
LIABILITIES, NET OF CASH AND OTHER ASSETS – (0.2)%				(166	)
NET ASSETS – 100.0%			$	69,537

Notes to Schedule of Investments

* Not shown due to rounding.

(A) No dividends were paid during the preceding 12 months.

(B) Securities whose value was determined using significant unobservable inputs.

(C) Rate shown is the annualized 7-day yield at June 30, 2020.

The following forward foreign currency contracts were outstanding at June 30, 2020:

	Currency to be Delivered			Currency to be Received		Settlement Date		Counterparty	Unrealized Appreciation		Unrealized Depreciation
Euro		3,925	U.S. Dollar		4,299		7-14-20	Morgan Stanley International	$	—	$	112
British Pound		4,699	U.S. Dollar		5,818		7-14-20	UBS AG		—		5
									$	—	$	117

42 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS NATURAL RESOURCES (in thousands)

JUNE 30, 2020 (UNAUDITED)

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Common Stocks
Consumer Staples	$	2,362	$	—	$	—
Energy		17,133		3,093		—
Industrials		5,944		—		—
Information Technology		425		—		—
Materials		26,762		7,613		—	*
Utilities		2,986		—		—
Total Common Stocks	$	55,612	$	10,706	$	—	*
Short-Term Securities		3,385		—		—
Total	$	58,997	$	10,706	$	—	*
Liabilities
Forward Foreign Currency Contracts	$	—	$	117	$	—

The following acronym is used throughout this schedule:

ADR = American Depositary Receipts

Market Sector Diversification

(as a % of net assets)
Materials	49.4%
Energy	29.1%
Industrials	8.5%
Utilities	4.3%
Consumer Staples	3.4%
Information Technology	0.6%
Other+	4.7%

+Includes liabilities (net of cash and other assets), and cash equivalents

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 43

PORTFOLIO HIGHLIGHTS SCIENCE AND TECHNOLOGY

ALL DATA AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Stocks	94.2%
Information Technology	57.2%
Health Care	15.5%
Communication Services	11.4%
Consumer Discretionary	8.1%
Real Estate	1.8%
Materials	0.2%
Warrants	0.0%
Bonds	0.1%
Corporate Debt Securities	0.1%
Cash and Other Assets (Net of Liabilities), and Cash Equivalents+	5.7%

Country Weightings

North America	76.8%
United States	76.8%
Pacific Basin	10.4%
China	4.7%
Other Pacific Basin	5.7%
Europe	7.1%
Netherlands	3.5%
Other Europe	3.6%
Cash and Other Assets (Net of Liabilities), and Cash Equivalents+	5.7%

Top 10 Equity Holdings

Company	Country	Sector	Industry
Microsoft Corp.	United States	Information Technology	Systems Software
Apple, Inc.	United States	Information Technology	Technology Hardware, Storage & Peripherals
Facebook, Inc., Class A	United States	Communication Services	Interactive Media & Services
Vertex Pharmaceuticals, Inc.	United States	Health Care	Biotechnology
Micron Technology, Inc.	United States	Information Technology	Semiconductors
Amazon.com, Inc.	United States	Consumer Discretionary	Internet & Direct Marketing Retail
Alibaba Group Holding Ltd. ADR	China	Consumer Discretionary	Internet & Direct Marketing Retail
Aspen Technology, Inc.	United States	Information Technology	Application Software
ASML Holding N.V., NY Registry Shares	Netherlands	Information Technology	Semiconductor Equipment
Cerner Corp.	United States	Health Care	Health Care Technology

See your advisor or www.ivyinvestments.com for more information on the Portfolio’s most recently published Top 10 Equity Holdings.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

44 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS SCIENCE AND TECHNOLOGY (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS	Shares		Value
Communication Services
Interactive Media & Services – 11.4%
Alphabet, Inc., Class A (A)		9	$	13,262
Alphabet, Inc., Class C (A)		9		13,207
Facebook, Inc., Class A (A)		153		34,730
Tencent Holdings Ltd. (B)		56		3,607
				64,806
Total Communication Services – 11.4%				64,806
Consumer Discretionary
Internet & Direct Marketing Retail – 8.1%
Alibaba Group Holding Ltd. ADR (A)		107		23,090
Amazon.com, Inc. (A)		8		23,094
				46,184
Total Consumer Discretionary – 8.1%				46,184
Health Care
Biotechnology – 10.8%
CRISPR Therapeutics AG (A)		66		4,887
Evogene Ltd. (A)		137		137
Ionis Pharmaceuticals, Inc. (A)		144		8,488
Moderna, Inc. (A)(C)		171		10,948
Sarepta Therapeutics, Inc. (A)		62		9,941
Vertex Pharmaceuticals, Inc. (A)		93		27,019
				61,420
Health Care Services – 1.3%
Teladoc Health, Inc. (A)		37		7,115
Health Care Technology – 3.4%
Cerner Corp.		285		19,512
Total Health Care – 15.5%				88,047
Information Technology
Application Software – 9.5%
ACI Worldwide, Inc. (A)		681		18,393
Aspen Technology, Inc. (A)		216		22,429
NVIDIA Corp.		18		6,782
salesforce.com, Inc. (A)		34		6,402
				54,006

COMMON STOCKS (Continued)	Shares		Value
Data Processing & Outsourced Services – 6.7%
Euronet Worldwide, Inc. (A)		147	$	14,104
Fiserv, Inc. (A)		48		4,675
WNS (Holdings) Ltd. ADR (A)		353		19,403
				38,182
Semiconductor Equipment – 3.5%
ASML Holding N.V., NY Registry Shares		54		20,011
Semiconductors – 17.3%
Infineon Technologies AG (B)		649		15,201
Microchip Technology, Inc.		83		8,751
Micron Technology, Inc. (A)		515		26,558
QUALCOMM, Inc.		189		17,217
Semtech Corp. (A)		139		7,257
Taiwan Semiconductor Manufacturing Co. Ltd. ADR		120		6,793
Universal Display Corp.		109		16,305
				98,082
Systems Software – 11.6%
Microsoft Corp.		289		58,784
ServiceNow, Inc. (A)		18		7,188
				65,972
Technology Hardware, Storage & Peripherals – 8.6%
Apple, Inc.		117		42,539
Samsung Electronics Co. Ltd. (B)		142		6,298
				48,837
Total Information Technology – 57.2%				325,090
Materials
Fertilizers & Agricultural Chemicals – 0.2%
Marrone Bio Innovations, Inc. (A)		1,138		1,332
Total Materials – 0.2%				1,332
Real Estate
Specialized REITs – 1.8%
QTS Realty Trust, Inc., Class A		160		10,274
Total Real Estate – 1.8%				10,274
TOTAL COMMON STOCKS – 94.2%			$	535,733
(Cost: $270,516)

WARRANTS		Shares		Value
Fertilizers & Agricultural Chemicals – 0.0%
Marrone Bio Innovations, Inc., expires 12-15-20 (D)(E)		85	$	36
Marrone Bio Innovations, Inc., expires 12-15-21 (D)(E)		32		13
Marrone Bio Innovations, Inc., expires 3-15-21 (D)(E)		38		16
Marrone Bio Innovations, Inc., expires 9-15-20 (D)(E)		18		8
				73
TOTAL WARRANTS – 0.0%			$	73
(Cost: $—)
CORPORATE DEBT SECURITIES	Principal
Materials
Fertilizers & Agricultural Chemicals – 0.1%
Marrone Bio Innovations, Inc.,
8.000%, 12-31-22 (D)	$	288		286
Total Materials – 0.1%				286
TOTAL CORPORATE DEBT SECURITIES – 0.1%			$	286
(Cost: $287)
SHORT-TERM SECURITIES	Shares
Money Market Funds (F) — 5.6%
State Street Institutional U.S. Government Money Market Fund – Premier Class, 0.120%		32,050		32,050
TOTAL SHORT-TERM SECURITIES – 5.6%			$	32,050
(Cost: $32,050)
TOTAL INVESTMENT SECURITIES – 99.9%			$	568,142
(Cost: $302,853)
CASH AND OTHER ASSETS, NET OF LIABILITIES – 0.1%				385
NET ASSETS – 100.0%			$	568,527

2020 SEMIANNUAL REPORT 45

SCHEDULE OF INVESTMENTS SCIENCE AND TECHNOLOGY (in thousands)

JUNE 30, 2020 (UNAUDITED)

Notes to Schedule of Investments

(A) No dividends were paid during the preceding 12 months.

(B) Listed on an exchange outside the United States.

(C) All or a portion of securities with an aggregate value of $5,939 are on loan.

(D) Restricted securities. At June 30, 2020, the Portfolio owned the following restricted securities:

Security	Acquisition Date(s)		Principal		Cost		Value
Marrone Bio Innovations, Inc., 8.000%, 12-31-22		8-20-15	$	288	$	287	$	286
			Shares
Marrone Bio Innovations, Inc., expires 12-15-20		8-20-15 – 5-1-20		85		—		36
Marrone Bio Innovations, Inc., expires 12-15-21		8-20-15 – 5-1-20		32		—		13
Marrone Bio Innovations, Inc., expires 3-15-21		8-20-15 – 5-1-20		38		—		16
Marrone Bio Innovations, Inc., expires 9-15-20		8-20-15 – 5-1-20		18		—		8
					$	287	$	359

The total value of these securities represented 0.1% of net assets at June 30, 2020.

(E) Warrants entitle the Portfolio to purchase a predetermined number of shares of common stock and are non-income producing. The purchase price and number of shares are subject to adjustment under certain conditions until the expiration date, if any.

(F) Rate shown is the annualized 7-day yield at June 30, 2020.

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Common Stocks
Communication Services	$	61,199	$	3,607	$	—
Consumer Discretionary		46,184		—		—
Health Care		88,047		—		—
Information Technology		303,591		21,499		—
Materials		1,332		—		—
Real Estate		10,274		—		—
Total Common Stocks	$	510,627	$	25,106	$	—
Warrants		—		73		—
Corporate Debt Securities		—		286		—
Short-Term Securities		32,050		—		—
Total	$	542,677	$	25,465	$	—

The following acronyms are used throughout this schedule:

ADR = American Depositary Receipts

REIT = Real Estate Investment Trust

Country Diversification

(as a % of net assets)
United States	76.8%
China	4.7%
Netherlands	3.5%
India	3.4%

Country Diversification (Continued)

Germany	2.7%
Taiwan	1.2%
South Korea	1.1%
Other Countries	0.9%
Other+	5.7%

+Includes cash and other assets (net of liabilities), and cash equivalents

See Accompanying Notes to Financial Statements.

46 SEMIANNUAL REPORT 2020

PORTFOLIO HIGHLIGHTS SMALL CAP CORE

ALL DATA AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Stocks	99.5%
Information Technology	19.8%
Health Care	16.2%
Financials	16.1%
Industrials	14.7%
Consumer Discretionary	10.8%
Consumer Staples	6.3%
Materials	6.2%
Communication Services	2.8%
Energy	2.4%
Real Estate	2.3%
Utilities	1.9%
Cash and Other Assets (Net of Liabilities), and Cash Equivalents+	0.5%

Top 10 Equity Holdings

Company	Sector	Industry
Switch, Inc., Class A	Information Technology	IT Consulting & Other Services
TreeHouse Foods, Inc.	Consumer Staples	Packaged Foods & Meats
Chemed Corp.	Health Care	Health Care Services
Knight Transportation, Inc.	Industrials	Trucking
Coherent, Inc.	Information Technology	Electronic Equipment & Instruments
Encompass Health Corp.	Health Care	Health Care Facilities
TCF Financial Corp.	Financials	Regional Banks
Halozyme Therapeutics, Inc.	Health Care	Biotechnology
Kemper Corp.	Financials	Multi-Line Insurance
Encore Capital Group, Inc.	Financials	Consumer Finance

See your advisor or www.ivyinvestments.com for more information on the Portfolio’s most recently published Top 10 Equity Holdings.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

2020 SEMIANNUAL REPORT 47

SCHEDULE OF INVESTMENTS SMALL CAP CORE (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS	Shares		Value
Communication Services
Alternative Carriers – 2.8%
Cogent Communications Group, Inc.		32	$	2,440
Vonage Holdings Corp. (A)		179		1,801
				4,241
Total Communication Services – 2.8%				4,241
Consumer Discretionary
Apparel, Accessories & Luxury Goods – 0.9%
Columbia Sportswear Co.		17		1,398
Auto Parts & Equipment – 0.8%
Visteon Corp. (A)		17		1,168
Education Services – 2.4%
2U, Inc. (A)		96		3,645
Footwear – 1.5%
Skechers USA, Inc. (A)		69		2,177
Homebuilding – 2.3%
KB Home		37		1,127
TopBuild Corp. (A)		21		2,384
				3,511
Homefurnishing Retail – 1.0%
Restoration Hardware Holdings, Inc.(A)		6		1,551
Leisure Products – 1.0%
Polaris, Inc.		16		1,495
Specialized Consumer Services – 0.9%
frontdoor, Inc. (A)		32		1,405
Total Consumer Discretionary – 10.8%				16,350
Consumer Staples
Agricultural Products – 1.0%
Bunge Ltd.		37		1,502
Packaged Foods & Meats – 5.3%
Nomad Foods Ltd. (A)		71		1,521
TreeHouse Foods, Inc. (A)		149		6,529
				8,050
Total Consumer Staples – 6.3%				9,552
Energy
Oil & Gas Exploration & Production – 2.4%
Magnolia Oil & Gas Corp. (A)		325		1,970
Parsley Energy, Inc., Class A		155		1,659
				3,629
Total Energy – 2.4%				3,629

COMMON STOCKS (Continued)	Shares		Value
Financials
Consumer Finance – 2.6%
Encore Capital Group, Inc.(A)(B)		115	$	3,928
Financial Exchanges & Data – 2.0%
Morningstar, Inc.		22		3,070
Investment Banking & Brokerage – 1.5%
LPL Investment Holdings, Inc.		29		2,280
Multi-Line Insurance – 2.6%
Kemper Corp.		54		3,941
Regional Banks – 6.0%
First Horizon National Corp.		144		1,433
TCF Financial Corp.		142		4,180
Webster Financial Corp.		120		3,444
				9,057
Thrifts & Mortgage Finance – 1.4%
Essent Group Ltd.		61		2,195
Total Financials – 16.1%				24,471
Health Care
Biotechnology – 2.8%
Exact Sciences Corp. (A)		3		303
Halozyme Therapeutics, Inc. (A)		147		3,953
				4,256
Health Care Equipment – 3.0%
Integer Holdings Corp. (A)		23		1,672
NuVasive, Inc. (A)		25		1,398
Tandem Diabetes Care, Inc. (A)		15		1,526
				4,596
Health Care Facilities – 2.9%
Encompass Health Corp.		71		4,385
Health Care Services – 3.3%
Chemed Corp.		11		4,917
Health Care Supplies – 2.0%
Haemonetics Corp. (A)		24		2,134
Quidel Corp. (A)		4		889
				3,023
Health Care Technology – 0.9%
Change Healthcare, Inc. (A)		122		1,371
Managed Health Care – 1.3%
HealthEquity, Inc. (A)		33		1,963
Total Health Care – 16.2%				24,511
Industrials
Electrical Components & Equipment – 3.6%
Generac Holdings, Inc. (A)		19		2,311
nVent Electric plc		169		3,172
				5,483

COMMON STOCKS (Continued)	Shares		Value
Environmental & Facilities Services – 2.0%
Clean Harbors, Inc. (A)		50	$	2,983
Industrial Machinery – 2.1%
Crane Co.		20		1,178
RBC Bearings, Inc. (A)		15		2,043
				3,221
Research & Consulting Services – 4.0%
FTI Consulting, Inc. (A)		21		2,388
ICF International, Inc.		55		3,584
				5,972
Trucking – 3.0%
Knight Transportation, Inc.		110		4,593
Total Industrials – 14.7%				22,252
Information Technology
Application Software – 1.2%
Q2 Holdings, Inc. (A)		22		1,881
Data Processing & Outsourced Services – 3.6%
Cardtronics plc, Class A (A)		133		3,196
EVERTEC, Inc.		79		2,231
				5,427
Electronic Components – 1.2%
Knowles Corp. (A)		117		1,788
Electronic Equipment & Instruments – 3.0%
Coherent, Inc. (A)		34		4,488
IT Consulting & Other Services – 4.3%
Switch, Inc., Class A		370		6,586
Semiconductor Equipment – 2.4%
Brooks Automation, Inc.		70		3,109
Enphase Energy, Inc. (A)		12		567
				3,676
Semiconductors – 2.0%
First Solar, Inc. (A)		60		2,951
Systems Software – 2.1%
Varonis Systems, Inc. (A)		36		3,181
Total Information Technology – 19.8%				29,978
Materials
Commodity Chemicals – 0.9%
Cabot Corp.		38		1,410
Diversified Chemicals – 1.0%
Huntsman Corp.		86		1,546
Diversified Metals & Mining – 2.5%
Compass Minerals International, Inc.		76		3,724

48 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS SMALL CAP CORE (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS (Continued)	Shares		Value
Specialty Chemicals – 1.8%
Element Solutions, Inc. (A)		245	$	2,660
Total Materials – 6.2%				9,340
Real Estate
Industrial REITs – 0.7%
STAG Industrial, Inc.		37		1,091
Retail REITs – 1.6%
Agree Realty Corp.		36		2,348
Total Real Estate – 2.3%				3,439
Utilities
Electric Utilities – 0.8%
Portland General Electric Co.		30		1,241
Gas Utilities – 1.1%
ONE Gas, Inc.		21		1,637
Total Utilities – 1.9%				2,878
TOTAL COMMON STOCKS – 99.5%			$	150,641
(Cost: $154,209)

SHORT-TERM SECURITIES	Shares		Value
Money Market Funds (D) – 0.5%
Dreyfus Institutional Preferred Government Money Market Fund – Institutional Shares, 0.100% (C)		563	$	563
State Street Institutional U.S. Government Money Market Fund – Premier Class, 0.120%		252		252
				815
TOTAL SHORT-TERM SECURITIES – 0.5%			$	815
(Cost: $815)
TOTAL INVESTMENT SECURITIES – 100.0%			$	151,456
(Cost: $155,024)
CASH AND OTHER ASSETS, NET OF LIABILITIES – 0.0%				32
NET ASSETS – 100.0%			$	151,488

Notes to Schedule of Investments

(A) No dividends were paid during the preceding 12 months.

(B) All or a portion of securities with an aggregate value of $549 are on loan.

(C) Investment made with cash collateral received from securities on loan.

(D) Rate shown is the annualized 7-day yield at June 30, 2020.

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Common Stocks	$	150,641	$	—	$	—
Short-Term Securities		815		—		—
Total	$	151,456	$	—	$	—

The following acronym is used throughout this schedule:

REIT = Real Estate Investment Trust

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 49

PORTFOLIO HIGHLIGHTS SMALL CAP GROWTH

ALL DATA AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Stocks	93.3%
Health Care	26.1%
Information Technology	26.0%
Industrials	14.9%
Consumer Discretionary	13.2%
Financials	7.7%
Consumer Staples	2.7%
Communication Services	2.3%
Real Estate	0.4%
Cash and Other Assets (Net of Liabilities), and Cash Equivalents+	6.7%

Top 10 Equity Holdings

Company	Sector	Industry
Five9, Inc.	Information Technology	Application Software
Wingstop, Inc.	Consumer Discretionary	Restaurants
Monolithic Power Systems, Inc.	Information Technology	Semiconductors
Mercury Computer Systems, Inc.	Industrials	Aerospace & Defense
CareDx, Inc.	Health Care	Health Care Technology
LHC Group, Inc.	Health Care	Health Care Services
Knight Transportation, Inc.	Industrials	Trucking
Varonis Systems, Inc.	Information Technology	Systems Software
Q2 Holdings, Inc.	Information Technology	Application Software
Nexstar Broadcasting Group, Inc.	Communication Services	Broadcasting

See your advisor or www.ivyinvestments.com for more information on the Portfolio’s most recently published Top 10 Equity Holdings.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

50 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS SMALL CAP GROWTH (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS	Shares		Value
Communication Services
Broadcasting – 2.3%
Gray Television, Inc. (A)		117	$	1,631
Nexstar Broadcasting Group, Inc.		83		6,927
				8,558
Total Communication Services – 2.3%				8,558
Consumer Discretionary
Auto Parts & Equipment – 1.5%
Fox Factory Holding Corp. (A)		66		5,443
Casinos & Gaming – 1.9%
Churchill Downs, Inc.		40		5,291
Monarch Casino & Resort, Inc. (A)		52		1,769
				7,060
Footwear – 0.9%
Deckers Outdoor Corp. (A)		17		3,411
Homebuilding – 2.9%
Installed Building Products, Inc. (A)		92		6,299
TopBuild Corp. (A)		38		4,338
				10,637
Leisure Facilities – 0.6%
SeaWorld Entertainment, Inc. (A)		149		2,212
Leisure Products – 1.5%
Malibu Boats, Inc., Class A (A)		105		5,461
Restaurants – 3.9%
Texas Roadhouse, Inc., Class A		66		3,446
Wingstop, Inc.		78		10,783
				14,229
Total Consumer Discretionary – 13.2%				48,453
Consumer Staples
Packaged Foods & Meats – 2.7%
Nomad Foods Ltd. (A)		281		6,018
TreeHouse Foods, Inc. (A)		89		3,884
				9,902
Total Consumer Staples – 2.7%				9,902
Financials
Asset Management & Custody Banks – 0.9%
Hamilton Lane, Inc., Class A		48		3,227
Insurance Brokers – 1.9%
eHealth, Inc. (A)		43		4,250
SelectQuote, Inc. (A)		100		2,534
				6,784
Investment Banking & Brokerage – 3.2%
Houlihan Lokey, Inc.		119		6,644
LPL Investment Holdings, Inc.		64		5,018
				11,662

COMMON STOCKS (Continued)	Shares		Value
Regional Banks – 1.7%
Prosperity Bancshares, Inc.		48	$	2,821
Seacoast Banking Corp. of Florida (A)		173		3,526
				6,347
Total Financials – 7.7%				28,020
Health Care
Biotechnology – 2.5%
Acceleron Pharma, Inc. (A)		6		533
Amicus Therapeutics, Inc. (A)		93		1,401
Halozyme Therapeutics, Inc. (A)		38		1,015
Insmed, Inc. (A)		26		709
Novavax, Inc. (A)		5		381
PTC Therapeutics, Inc. (A)		13		674
Vericel Corp. (A)		319		4,411
				9,124
Health Care Distributors – 1.9%
PetIQ, Inc. (A)		197		6,870
Health Care Equipment – 7.6%
Axonics Modulation Technologies, Inc. (A)		12		431
Insulet Corp. (A)		25		4,884
iRhythm Technologies, Inc. (A)		31		3,535
NovoCure Ltd. (A)		20		1,185
Penumbra, Inc. (A)		29		5,182
Tactile Systems Technology, Inc. (A)		116		4,791
Tandem Diabetes Care, Inc. (A)		51		5,072
Veracyte, Inc. (A)		106		2,753
				27,833
Health Care Services – 4.2%
1Life Healthcare, Inc. (A)(B)		105		3,814
AMN Healthcare Services, Inc. (A)		95		4,320
LHC Group, Inc. (A)		42		7,356
				15,490
Health Care Supplies – 3.0%
Haemonetics Corp. (A)		71		6,336
OraSure Technologies, Inc. (A)		117		1,361
STAAR Surgical Co. (A)		53		3,254
				10,951
Health Care Technology – 6.0%
CareDx, Inc. (A)		222		7,857
HMS Holdings Corp. (A)		192		6,215
Livongo Health, Inc. (A)(B)		43		3,208
Omnicell, Inc. (A)		68		4,778
				22,058
Life Sciences Tools & Services – 0.2%
NeoGenomics, Inc. (A)		26		798
Managed Health Care – 0.7%
HealthEquity, Inc. (A)		46		2,717
Total Health Care – 26.1%				95,841

COMMON STOCKS (Continued)	Shares		Value
Industrials
Aerospace & Defense – 2.4%
Mercury Computer Systems, Inc. (A)		112	$	8,815
Air Freight & Logistics – 1.4%
Air Transport Services Group, Inc. (A)		236		5,260
Building Products – 1.7%
Simpson Manufacturing Co., Inc.		37		3,094
Trex Co., Inc. (A)		23		3,019
				6,113
Electrical Components & Equipment – 1.2%
EnerSys		67		4,322
Environmental & Facilities Services – 1.2%
Clean Harbors, Inc. (A)		72		4,310
Industrial Machinery – 3.1%
Crane Co.		72		4,297
John Bean Technologies Corp.		45		3,873
RBC Bearings, Inc. (A)		26		3,441
				11,611
Security & Alarm Services – 1.6%
Brink’s Co. (The)		128		5,808
Trucking – 2.3%
Knight Transportation, Inc.		175		7,280
Saia, Inc. (A)		11		1,253
				8,533
Total Industrials – 14.9%				54,772
Information Technology
Application Software – 13.4%
Envestnet, Inc. (A)		71		5,253
Five9, Inc. (A)		117		12,897
Globant S.A. (A)		44		6,636
HubSpot, Inc. (A)		12		2,676
LivePerson, Inc. (A)		90		3,748
Mimecast Ltd. (A)		147		6,119
Q2 Holdings, Inc. (A)		81		6,963
Smartsheet, Inc., Class A (A)		95		4,825
				49,117
Communications Equipment – 1.2%
Viavi Solutions, Inc. (A)		331		4,212
Data Processing & Outsourced Services – 0.6%
EVO Payments, Inc., Class A (A)		100		2,278
Electronic Equipment & Instruments – 1.3%
Coherent, Inc. (A)		36		4,699
IT Consulting & Other Services – 1.7%
Booz Allen Hamilton Holding Corp.		51		3,955
Switch, Inc., Class A		129		2,299
				6,254

2020 SEMIANNUAL REPORT 51

SCHEDULE OF INVESTMENTS SMALL CAP GROWTH (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS (Continued)	Shares		Value
Semiconductor Equipment – 1.2%
Enphase Energy, Inc. (A)		93	$	4,439
Semiconductors – 2.8%
Monolithic Power Systems, Inc.		39		9,218
SiTime Corp. (A)		24		1,161
				10,379
Systems Software – 3.8%
Proofpoint, Inc. (A)		60		6,657
Varonis Systems, Inc. (A)		81		7,202
				13,859
Total Information Technology – 26.0%				95,237
Real Estate
Health Care REITs – 0.4%
Community Healthcare Trust, Inc.		35		1,412
Total Real Estate – 0.4%				1,412
TOTAL COMMON STOCKS – 93.3%			$	342,195
(Cost: $270,923)

SHORT-TERM SECURITIES	Shares		Value
Money Market Funds (D) – 6.5%
Dreyfus Institutional Preferred Government Money Market Fund – Institutional Shares, 0.100% (C)		2,801	$	2,801
State Street Institutional U.S. Government Money Market Fund – Premier Class, 0.120%		20,911		20,911
				23,712
TOTAL SHORT-TERM SECURITIES – 6.5%			$	23,712
(Cost: $23,712)
TOTAL INVESTMENT SECURITIES – 99.8%			$	365,907
(Cost: $294,635)
CASH AND OTHER ASSETS, NET OF LIABILITIES – 0.2%				802
NET ASSETS – 100.0%			$	366,709

Notes to Schedule of Investments

* Not shown due to rounding.

(A) No dividends were paid during the preceding 12 months.

(B) All or a portion of securities with an aggregate value of $2,746 are on loan.

(C) Investment made with cash collateral received from securities on loan.

(D) Rate shown is the annualized 7-day yield at June 30, 2020.

The following total return swap agreements were outstanding at June 30, 2020:

Underlying Security

Long/Short

Counterparty

Maturity Date

Notional Amount

Financing Fee(1)(2)

Value

Upfront Payments/ (Receipts)

Unrealized Appreciation

Biotech Custom Index

Long

JPMorgan Chase Bank N.A.

06/29/2021

$

14,041

1-Month LIBOR minus 0.2 bps

$

227

$

—

$

227

(1) The Portfolio pays the financing fee multiplied by the notional amount if long on the swap agreement. If the Portfolio is short on the swap agreement, the Portfolio receives the financing fee multiplied by the notional amount.

(2) At the termination date, a net cash flow is exchanged where the market-linked total return is equivalent to the return of the underlying security less a financing rate, if any. If the Portfolio is long on the swap agreement, the Portfolio would receive payments on any net positive total return, and would owe payments in the event of a negative total return. If the Portfolio is short on the swap agreement, the Portfolio would owe payments on any net positive total return, and would receive payments in the event of a negative total return.

52 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS SMALL CAP GROWTH (in thousands)

JUNE 30, 2020 (UNAUDITED)

The following table represents security positions within the total return basket swap as of June 30, 2020:

Reference Entity	Shares			Notional Amount		Value		% of Value
Global Blood Therapeutics, Inc.		—	*	$	911	$	15		6.5	%
Repligen Corp.		—	*		637		10		4.5
ACADIA Pharmaceuticals, Inc.		—	*		588		9		4.2
Immunomedics, Inc.		—	*		561		9		4.0
Iovance Biotherapeutics, Inc.		—	*		426		7		3.0
Emergent BioSolutions, Inc.		—	*		394		6		2.8
Acceleron Pharma, Inc.		—	*		382		6		2.7
Ultragenyx Pharmaceutical, Inc.		—	*		380		6		2.7
Halozyme Therapeutics, Inc.		—	*		375		6		2.7
Arrowhead Pharmaceuticals, Inc.		—	*		366		6		2.6
Momenta Pharmaceuticals, Inc.		—	*		360		6		2.6
PTC Therapeutics, Inc.		—	*		336		5		2.4
Blueprint Medicines Corp.		—	*		332		5		2.4
MyoKardia, Inc.		—	*		319		5		2.3
Amicus Therapeutics, Inc.		—	*		315		5		2.2
FibroGen, Inc.		—	*		297		5		2.1
Axsome Therapeutics, Inc.		—	*		259		4		1.8
Mirati Therapeutics, Inc.		—	*		247		4		1.8
Natera, Inc.		—	*		237		4		1.7
Intercept Pharmaceuticals, Inc.		—	*		232		4		1.6
Arena Pharmaceuticals, Inc.		—	*		227		4		1.6
Insmed, Inc.		—	*		207		3		1.5
Pacira BioSciences, Inc.		—	*		193		3		1.4
Apellis Pharmaceuticals, Inc.		—	*		191		3		1.4
Biohaven Pharmaceutical Holding Co. Ltd.		—	*		183		3		1.3
Ironwood Pharmaceuticals, Inc.		—	*		175		3		1.2
Invitae Corp.		—	*		166		3		1.2
Fate Therapeutics, Inc.		—	*		164		3		1.2
Reata Pharmaceuticals, Inc.		—	*		154		3		1.1
REGENXBIO, Inc.		—	*		153		2		1.1
Xencor, Inc.		—	*		153		2		1.1
Veracyte, Inc.		—	*		149		2		1.1
Theravance Biopharma, Inc.		—	*		148		2		1.1
Corcept Therapeutics, Inc.		—	*		144		2		1.0
Zogenix, Inc.		—	*		140		2		1.0
Editas Medicine, Inc.		—	*		134		2		1.0
Supernus Pharmaceuticals, Inc.		—	*		133		2		1.0
Allakos, Inc.		—	*		131		2		0.9
Allogene Therapeutics, Inc.		—	*		130		2		0.9
Heron Therapeutics, Inc.		—	*		121		2		0.9
Denali Therapeutics, Inc.		—	*		120		2		0.9
Dicerna Pharmaceuticals, Inc.		—	*		117		2		0.8

Reference Entity	Shares			Notional Amount		Value			% of Value
Esperion Therapeutics, Inc.		—	*	$	114	$	2			0.8	%
NanoString Technologies, Inc.		—	*		112		2			0.8
Exact Sciences Corp.		—	*		111		2			0.8
Epizyme, Inc.		—	*		109		2			0.8
Innoviva, Inc.		—	*		105		2			0.7
TG Therapeutics, Inc.		—	*		95		2			0.7
Enanta Pharmaceuticals, Inc.		—	*		92		2			0.7
Omeros Corp.		—	*		90		1			0.6
Aimmune Therapeutics, Inc.		—	*		87		1			0.6
Radius Health, Inc.		—	*		81		1			0.6
Twist Bioscience Corp.		—	*		80		1			0.6
Sangamo Therapeutics, Inc.		—	*		76		1			0.5
Tricida, Inc.		—	*		76		1			0.5
Aerie Pharmaceuticals, Inc.		—	*		75		1			0.5
Madrigal Pharmaceuticals, Inc.		—	*		75		1			0.5
Vericel Corp.		—	*		73		1			0.5
Adverum Biotechnologies, Inc.		—	*		72		1			0.5
Retrophin, Inc.		—	*		71		1			0.5
Amphastar Pharmaceuticals, Inc.		—	*		70		1			0.5
Codexis, Inc.		—	*		70		1			0.5
Vanda Pharmaceuticals, Inc.		—	*		69		1			0.5
PetIQ, Inc.		—	*		62		1			0.4
Athenex, Inc.		—	*		62		1			0.4
Phibro Animal Health Corp.		—	*		60		1			0.4
Heska Corp.		—	*		57		1			0.4
Portola Pharmaceuticals, Inc.		—	*		54		1			0.4
ZIOPHARM Oncology, Inc.		—	*		52		1			0.4
Cara Therapeutics, Inc.		—	*		51		1			0.4
Pacific Biosciences of California, Inc.		—	*		49		1			0.4
UroGen Pharma Ltd.		—	*		49		1			0.3
ANI Pharmaceuticals, Inc.		—	*		43		1			0.3
Atara Biotherapeutics, Inc.		—	*		42		1			0.3
Clovis Oncology, Inc.		—	*		42		1			0.3
Amneal Pharmaceuticals, Inc.		—	*		39		1			0.3
AnaptysBio, Inc.		—	*		37		1			0.3
Spectrum Pharmaceuticals, Inc.		—	*		34		1			0.2
Accelerate Diagnostics, Inc.		—	*		34		1			0.2
G1 Therapeutics, Inc.		—	*		30		1			0.2
Voyager Therapeutics, Inc.		—	*		30		1			0.2
Stemline Therapeutics, Inc.		—	*		24		—	*		0.2
						$	227

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Common Stocks	$	342,195	$	—	$	—
Short-Term Securities		23,712		—		—
Total	$	365,907	$	—	$	—
Total Return Swaps	$	—	$	227	$	—

The following acronym is used throughout this schedule:

REIT = Real Estate Investment Trust

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 53

STATEMENTS OF ASSETS AND LIABILITIES IVY VIP

AS OF JUNE 30, 2020 (UNAUDITED)

(In thousands, except per share amounts)	Asset Strategy(1)			Balanced			Energy				Growth			High Income				International Core Equity				Mid Cap Growth
ASSETS
Investments in unaffiliated securities at value+^		$	662,421		$	308,516		$	33,296			$	816,564		$	804,077			$	594,358			$	546,576
Investments in affiliated securities at value+			—			—			—				—			424				—				—
Bullion at value+			47,359			—			—				—			—				—				—
Investments at Value			709,780			308,516			33,296				816,564			804,501				594,358				546,576
Cash			439			28			—				—			7,034				1				26
Cash denominated in foreign currencies at value+			—			—			—				—			—				964				—
Investment securities sold receivable			2,373			637			321				—			13,380				645				642
Dividends and interest receivable			3,190			965			32				539			11,779				2,337				67
Capital shares sold receivable			52			18			40				30			232				27				447
Receivable from affiliates			—			—			—				—			—				—				154
Unrealized appreciation on forward foreign currency contracts			—			—			—				—			—				148				—
Receivable from securities lending income – net			16			1			1				—			4				22				—	*
Prepaid and other assets			—			—			—				1			—	*			—				—
Total Assets			715,850			310,165			33,690				817,134			836,930				598,502				547,912
LIABILITIES
Cash collateral on securities loaned at value			17,625			150			560				—			3,889				15,859				3,497
Investment securities purchased payable			4,734			2,068			316				—			44,236				1,719				397
Capital shares redeemed payable			667			168			15				808			5,068				470				5,404
Independent Trustees and Chief Compliance Officer fees payable			124			57			7				133			58				73				32
Distribution and service fees payable			5			2			—	*			6			5				4				2
Investment management fee payable			13			6			1				16			13				13				13
Accounting services fee payable			14			8			1				17			17				13				12
Written options at value+			62			—			—				—			—				—				1,122
Other liabilities			30			16			7				21			304				365				20
Total Liabilities			23,274			2,475			907				1,001			53,590				18,516				10,499
Commitments and Contingencies
(See Note 2 and Note 14)
Total Net Assets		$	692,576		$	307,690		$	32,783			$	816,133		$	783,340			$	579,986			$	537,413
NET ASSETS
Capital paid in (shares authorized – unlimited)		$	663,611		$	274,795		$	101,158			$	503,896		$	961,765			$	658,375			$	334,308
Accumulated earnings gain (loss)			28,965			32,895			(68,375	)			312,237			(178,425	)			(78,389	)			203,105
Total Net Assets		$	692,576		$	307,690		$	32,783			$	816,133		$	783,340			$	579,986			$	537,413
CAPITAL SHARES OUTSTANDING:
Class I			35			N/A			56				N/A			6,267				N/A				16,034
Class II			76,942			41,658			15,486				77,100			257,290				42,637				24,835
NET ASSET VALUE PER SHARE:
Class I		$	9.01			N/A		$	2.11				N/A		$	2.98				N/A			$	13.19
Class II		$	9.00		$	7.39		$	2.11			$	10.59		$	2.97			$	13.60			$	13.12
+COST
Investments in unaffiliated securities at cost		$	657,260		$	288,551		$	49,497			$	550,959		$	924,427			$	630,114			$	379,597
Investments in affiliated securities at cost			—			—			—				—			1,096				—				—
Bullion at cost			32,745			—			—				—			—				—				—
Cash denominated in foreign currencies at cost			—			—			—				—			—				965				—
Written options premiums received at cost			172			—			—				—			—				—				534
^Securities loaned at value			16,835			147			541				—			3,802				20,376				3,419

* Not shown due to rounding.

(1) Consolidated Statement of Assets and Liabilities (See Note 5 in Notes to Financial Statements).

See Accompanying Notes to Financial Statements.

54 SEMIANNUAL REPORT 2020

STATEMENTS OF ASSETS AND LIABILITIES IVY VIP

AS OF JUNE 30, 2020 (UNAUDITED)

(In thousands, except per share amounts)	Natural Resources				Science and Technology			Small Cap Core				Small Cap Growth
ASSETS
Investments in unaffiliated securities at value+^		$	69,703			$	568,142		$	151,456			$	365,907
Investments at Value			69,703				568,142			151,456				365,907
Cash denominated in foreign currencies at value+			—	*			—			—				—
Investment securities sold receivable			19				—			1,076				19,081
Dividends and interest receivable			83				287			87				324
Capital shares sold receivable			37				467			4				19
Receivable from affiliates			—				—			—				64
Swap agreements, at value			—				—			—				227
Receivable from securities lending income – net			—				2			—	*			—	*
Total Assets			69,842				568,898			152,623				385,622
LIABILITIES
Cash collateral on securities loaned at value			—				—			563				2,801
Investment securities purchased payable			20				—			225				15,553
Capital shares redeemed payable			96				268			293				461
Independent Trustees and Chief Compliance Officer fees payable			15				54			29				66
Distribution and service fees payable			—	*			4			1				2
Investment management fee payable			2				13			4				8
Accounting services fee payable			4				12			5				8
Unrealized depreciation on forward foreign currency contracts			117				—			—				—
Other liabilities			51				20			15				14
Total Liabilities			305				371			1,135				18,913
Commitments and Contingencies
(See Note 2 and Note 14)
Total Net Assets		$	69,537			$	568,527		$	151,488			$	366,709
NET ASSETS
Capital paid in (shares authorized – unlimited)		$	150,840			$	281,149		$	165,303			$	280,049
Accumulated earnings gain (loss)			(81,303	)			287,378			(13,815	)			86,660
Total Net Assets		$	69,537			$	568,527		$	151,488			$	366,709
CAPITAL SHARES OUTSTANDING:
Class I			N/A				59			N/A				5,904
Class II			23,999				19,051			14,097				35,964
NET ASSET VALUE PER SHARE:
Class I			N/A			$	29.91			N/A			$	8.79
Class II		$	2.90			$	29.75		$	10.75			$	8.75
+COST
Investments in unaffiliated securities at cost		$	80,439			$	302,853		$	155,024			$	294,635
Cash denominated in foreign currencies at cost			—				—			—				—
^Securities loaned at value			—				5,939			549				2,746

*Not shown due to rounding.

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 55

STATEMENTS OF OPERATIONS IVY VIP

FOR THE SIX MONTHS ENDED JUNE 30, 2020 (UNAUDITED)

(In thousands)	Asset Strategy(1)				Balanced				Energy				Growth				High Income				International Core Equity				Mid Cap Growth
INVESTMENT INCOME
Dividends from unaffiliated securities		$	4,629			$	1,929			$	423			$	3,567			$	967			$	8,469			$	1,488
Foreign dividend withholding tax			(362	)			(22	)			(7	)			(14	)			—				(763	)			—
Interest and amortization from unaffiliated securities			6,406				1,487				4				29				28,486				125				46
Interest and amortization from affiliated securities			—				—				—				—				33				—				—
Securities lending income – net			26				9				4				—	*			117				33				7
Total Investment Income			10,699				3,403				424				3,582				29,603				7,864				1,541
EXPENSES
Investment management fee			2,421				1,076				127				2,678				2,477				2,519				2,159
Distribution and service fees:
Class II			864				384				37				956				980				741				370
Shareholder servicing:
Class I			—	*			N/A				—	*			N/A				—	*			N/A				—	*
Class II			—	*			—	*			—	*			—	*			—	*			—	*			—	*
Custodian fees			21				4				5				5				10				37				10
Independent Trustees and Chief Compliance Officer fees			18				15				2				41				28				15				13
Accounting services fee			88				47				10				95				101				75				70
Professional fees			78				36				29				33				84				42				30
Third-party valuation service fees			—				—				—				—				—				7				—	*
Commitment and interest expense for borrowing			—				—				—				—				42				—				—
Other			40				12				4				22				35				19				16
Total Expenses			3,530				1,574				214				3,830				3,757				3,455				2,668
Less:
Expenses in excess of limit			—				—				(21	)			—				—				—				(154	)
Total Net Expenses			3,530				1,574				193				3,830				3,757				3,455				2,514
Net Investment Income (Loss)			7,169				1,829				231				(248	)			25,846				4,409				(973	)
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:
Investments in unaffiliated securities			6,012				11,145				(14,171	)			47,210				(9,225	)			(45,744	)			36,487
Written options			599				—				—				—				—				24				1,393
Forward foreign currency contracts			—				—				—				—				—				(950	)			—
Foreign currency exchange transactions			(102	)			—				—				—				—				134				(1	)
Net change in unrealized appreciation (depreciation) on:
Investments in unaffiliated securities			(52,167	)			(24,748	)			(3,326	)			19,383				(79,253	)			(30,562	)			22,446
Investments in affiliated securities			—				—				—				—				(531	)			—				—
Written options			110				—				—				—				—				—				(588	)
Forward foreign currency contracts			—				—				—				—				—				981				—
Foreign currency exchange transactions			2				—				—				—				—				7				—	*
Net Realized and Unrealized Gain (Loss)			(45,546	)			(13,603	)			(17,497	)			66,593				(89,009	)			(76,110	)			59,737
Net Increase (Decrease) in Net Assets Resulting from Operations		$	(38,377	)		$	(11,774	)		$	(17,266	)		$	66,345			$	(63,163	)		$	(71,701	)		$	58,764

* Not shown due to rounding.

(1) Consolidated Statement of Operations (See Note 5 in Notes to Financial Statements).

See Accompanying Notes to Financial Statements.

56 SEMIANNUAL REPORT 2020

STATEMENTS OF OPERATIONS IVY VIP

FOR THE SIX MONTHS ENDED JUNE 30, 2020 (UNAUDITED)

(In thousands)	Natural Resources				Science and Technology				Small Cap Core				Small Cap Growth
INVESTMENT INCOME
Dividends from unaffiliated securities		$	1,103			$	1,518			$	860			$	694
Foreign dividend withholding tax			(42	)			(80	)			—				—
Interest and amortization from unaffiliated securities			10				56				17				59
Securities lending income – net			1				7				2				9
Total Investment Income			1,072				1,501				879				762
EXPENSES
Investment management fee			297				2,274				676				1,503
Distribution and service fees:
Class II			87				667				199				377
Shareholder servicing:
Class I			N/A				—	*			N/A				—	*
Class II			—	*			—	*			—	*			—	*
Custodian fees			6				9				11				2
Independent Trustees and Chief Compliance Officer fees			2				19				4				18
Accounting services fee			21				71				32				54
Professional fees			40				37				31				31
Third-party valuation service fees			1				2				—				—
Other			15				23				8				24
Total Expenses			469				3,102				961				2,009
Less:
Expenses in excess of limit			—				—				—				(64	)
Total Net Expenses			469				3,102				961				1,945
Net Investment Income (Loss)			603				(1,601	)			(82	)			(1,183	)
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:
Investments in unaffiliated securities			(19,206	)			25,685				(9,994	)			16,155
Swap agreements			—				—				—				1,330
Forward foreign currency contracts			(106	)			—				—				—
Foreign currency exchange transactions			(2	)			(2	)			—				—
Net change in unrealized appreciation (depreciation) on:
Investments in unaffiliated securities			(1,206	)			160				(20,815	)			(16,758	)
Swap agreements			—				—				—				(399	)
Forward foreign currency contracts			784				—				—				—
Foreign currency exchange transactions			—	*			—	*			—				—
Net Realized and Unrealized Gain (Loss)			(19,736	)			25,843				(30,809	)			328
Net Increase (Decrease) in Net Assets Resulting from Operations		$	(19,133	)		$	24,242			$	(30,891	)		$	(855	)

* Not shown due to rounding.

.

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 57

STATEMENTS OF CHANGES IN NET ASSETS IVY VIP

	Asset Strategy(1)								Balanced								Energy
(In thousands)	Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19				Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19				Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income		$	7,169			$	14,981			$	1,829			$	4,555			$	231			$	177
Net realized gain (loss) on investments			6,509				32,609				11,145				17,335				(14,171	)			(7,223	)
Net change in unrealized appreciation (depreciation)			(52,055	)			104,156				(24,748	)			43,391				(3,326	)			8,632
Net Increase (Decrease) in Net Assets Resulting from Operations			(38,377	)			151,746				(11,774	)			65,281				(17,266	)			1,586
Distributions to Shareholders From:
Accumulated earnings:
(combined net investment income and net realized gains)
Class I			(1	)			(20	)			N/A				N/A				(2	)			—
Class II			(3,105	)			(45,846	)			(21,608	)			(31,681	)			(234	)			—
Total Distributions to Shareholders			(3,106	)			(45,866	)			(21,608	)			(31,681	)			(236	)			—
Capital Share Transactions			(38,549	)			(86,614	)			233				(3,079	)			8,628				873
Net Increase (Decrease) in Net Assets			(80,032	)			19,266				(33,149	)			30,521				(8,874	)			2,459
Net Assets, Beginning of Period			772,608				753,342				340,839				310,318				41,657				39,198
Net Assets, End of Period		$	692,576			$	772,608			$	307,690			$	340,839			$	32,783			$	41,657
	Growth								High Income								International Core Equity
(In thousands)	Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19				Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19				Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income (loss)		$	(248	)		$	(392	)		$	25,846			$	58,517			$	4,409			$	13,679
Net realized gain (loss) on investments			47,210				112,843				(9,225	)			(1,766	)			(46,536	)			645
Net change in unrealized appreciation (depreciation)			19,383				118,696				(79,784	)			36,407				(29,574	)			105,350
Net Increase (Decrease) in Net Assets Resulting from Operations			66,345				231,147				(63,163	)			93,158				(71,701	)			119,674
Distributions to Shareholders From:
Accumulated earnings:
(combined net investment income and net realized gains)
Class I			N/A				N/A				(1,439	)			(3,156	)			N/A				N/A
Class II			(112,473	)			(186,937	)			(57,106	)			(55,287	)			(14,682	)			(70,370	)
Total Distributions to Shareholders			(112,473	)			(186,937	)			(58,545	)			(58,443	)			(14,682	)			(70,370	)
Capital Share Transactions			71,561				77,299				19,175				4,104				(32,708	)			(26,103	)
Net Increase (Decrease) in Net Assets			25,433				121,509				(102,533	)			38,819				(119,091	)			23,201
Net Assets, Beginning of Period			790,700				669,191				885,873				847,054				699,077				675,876
Net Assets, End of Period		$	816,133			$	790,700			$	783,340			$	885,873			$	579,986			$	699,077

(1) Consolidated Statements of Changes in Net Assets (See Note 5 in Notes to Financial Statements).

See Accompanying Notes to Financial Statements.

58 SEMIANNUAL REPORT 2020

STATEMENTS OF CHANGES IN NET ASSETS IVY VIP

	Mid Cap Growth								Natural Resources								Science and Technology
(In thousands)	Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19				Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19				Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income (loss)		$	(973	)		$	(1,716	)		$	603			$	1,676			$	(1,601	)		$	(2,507	)
Net realized gain (loss) on investments			37,879				41,235				(19,314	)			(8,446	)			25,683				74,933
Net change in unrealized appreciation (depreciation)			21,858				114,679				(422	)			15,165				160				130,323
Net Increase (Decrease) in Net Assets Resulting from Operations			58,764				154,198				(19,133	)			8,395				24,242				202,749
Distributions to Shareholders From:
Accumulated earnings:
(combined net investment income and net realized gains)
Class I			(16,217	)			(35,378	)			N/A				N/A				(47	)			(80	)
Class II			(23,025	)			(46,820	)			(1,678	)			(870	)			(24,127	)			(49,737	)
Total Distributions to Shareholders			(39,242	)			(82,198	)			(1,678	)			(870	)			(24,174	)			(49,817	)
Capital Share Transactions			(29,675	)			61,552				2,740				(8,357	)			(11,964	)			(2,175	)
Net Increase (Decrease) in Net Assets			(10,153	)			133,552				(18,071	)			(832	)			(11,896	)			150,757
Net Assets, Beginning of Period			547,566				414,014				87,608				88,440				580,423				429,666
Net Assets, End of Period		$	537,413			$	547,566			$	69,537			$	87,608			$	568,527			$	580,423
	Small Cap Core								Small Cap Growth
(In thousands)	Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19				Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment loss		$	(82	)		$	(89	)		$	(1,183	)		$	(3,127	)
Net realized gain (loss) on investments			(9,994	)			9,076				17,485				23,488
Net change in unrealized appreciation (depreciation)			(20,815	)			32,388				(17,157	)			60,210
Net Increase (Decrease) in Net Assets Resulting from Operations			(30,891	)			41,375				(855	)			80,571
Distributions to Shareholders From:
Accumulated earnings:
(combined net investment income and net realized gains)
Class I			N/A				N/A				—				(4,305	)
Class II			(8,739	)			(36,690	)			—				(24,945	)
Total Distributions to Shareholders			(8,739	)			(36,690	)			—				(29,250	)
Capital Share Transactions			3,102				7,974				(21,379	)			(14,405	)
Net Increase (Decrease) in Net Assets			(36,528	)			12,659				(22,234	)			36,916
Net Assets, Beginning of Period			188,016				175,357				388,943				352,027
Net Assets, End of Period		$	151,488			$	188,016			$	366,709			$	388,943

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 59

FINANCIAL HIGHLIGHTS IVY VIP

FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD

	Net Asset Value, Beginning of Period			Net Investment Income (Loss)(1)				Net Realized and Unrealized Gain (Loss) on Investments				Total from Investment Operations				Distributions From Net Investment Income				Distributions From Net Realized Gains				Total Distributions
Asset Strategy
Class I Shares
Six-month period ended 6-30-2020 (unaudited)		$	9.50		$	0.10			$	(0.55	)		$	(0.45	)		$	(0.01	)		$	(0.03	)		$	(0.04	)
Year ended 12-31-2019			8.29			0.20				1.63				1.83				(0.23	)			(0.39	)			(0.62	)
Year ended 12-31-2018			9.37			0.18				(0.67	)			(0.49	)			(0.20	)			(0.39	)			(0.59	)
Year ended 12-31-2017(4)			8.57			0.08				0.88				0.96				(0.16	)			—				(0.16	)
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			9.50			0.09				(0.55	)			(0.46	)			(0.01	)			(0.03	)			(0.04	)
Year ended 12-31-2019			8.29			0.18				1.62				1.80				(0.20	)			(0.39	)			(0.59	)
Year ended 12-31-2018			9.37			0.16				(0.67	)			(0.51	)			(0.18	)			(0.39	)			(0.57	)
Year ended 12-31-2017			8.04			0.03				1.44				1.47				(0.14	)			—				(0.14	)
Year ended 12-31-2016			8.30			0.06				(0.27	)			(0.21	)			(0.05	)			—				(0.05	)
Year ended 12-31-2015			10.87			0.08				(0.77	)			(0.69	)			(0.04	)			(1.84	)			(1.88	)
Balanced
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			8.22			0.04				(0.33	)			(0.29	)			(0.11	)			(0.43	)			(0.54	)
Year ended 12-31-2019			7.46			0.11				1.44				1.55				(0.14	)			(0.65	)			(0.79	)
Year ended 12-31-2018			7.95			0.12				(0.36	)			(0.24	)			(0.13	)			(0.12	)			(0.25	)
Year ended 12-31-2017			7.47			0.12				0.70				0.82				(0.12	)			(0.22	)			(0.34	)
Year ended 12-31-2016			8.76			0.11				0.00	*			0.11				(0.12	)			(1.28	)			(1.40	)
Year ended 12-31-2015			10.19			0.12				(0.09	)			0.03				(0.09	)			(1.37	)			(1.46	)
Energy
Class I Shares
Six-month period ended 6-30-2020 (unaudited)			4.02			0.02				(1.90	)			(1.88	)			(0.03	)			—				(0.03	)
Year ended 12-31-2019			3.88			0.03				0.11				0.14				—				—				—
Year ended 12-31-2018			5.87			0.00	*			(1.99	)			(1.99	)			—				—				—
Year ended 12-31-2017(4)			5.84			0.06				0.02				0.08				(0.05	)			—				(0.05	)
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			4.00			0.02				(1.89	)			(1.87	)			(0.02	)			—				(0.02	)
Year ended 12-31-2019			3.87			0.02				0.11				0.13				—				—				—
Year ended 12-31-2018			5.87			(0.02	)			(1.98	)			(2.00	)			—				—				—
Year ended 12-31-2017			6.77			0.04				(0.90	)			(0.86	)			(0.04	)			—				(0.04	)
Year ended 12-31-2016			5.04			(0.02	)			1.76				1.74				(0.01	)			—				(0.01	)
Year ended 12-31-2015			6.51			0.00	*			(1.44	)			(1.44	)			—	*			(0.03	)			(0.03	)

* Not shown due to rounding.

(1) Based on average weekly shares outstanding.

(2) Based on net asset value. Total returns do not reflect a sales charge or contingent deferred sales charge, if applicable. Total returns for periods less than one year are not annualized.

(3) Ratios excluding expense waivers are included only for periods in which the class had waived or reimbursed expenses.

(4) For the period from April 28, 2017 (commencement of operations of the class) through December 31, 2017.

(5) Annualized.

(6) Portfolio turnover is calculated at the fund level. Percentage indicated was calculated for the period ended December 31, 2017.

60 SEMIANNUAL REPORT 2020

	Net Asset Value, Beginning of Period			Net Investment Income (Loss)(1)				Net Realized and Unrealized Gain (Loss) on Investments				Total from Investment Operations				Distributions From Net Investment Income				Distributions From Net Realized Gains				Total Distributions
Growth
Class II Shares
Six-month period ended 6-30-2020 (unaudited)		$	11.33		$	0.00	*		$	0.90			$	0.90			$	—			$	(1.64	)		$	(1.64	)
Year ended 12-31-2019			11.02			(0.01	)			3.58				3.57				—				(3.26	)			(3.26	)
Year ended 12-31-2018			12.09			0.00	*			0.36				0.36				—	*			(1.43	)			(1.43	)
Year ended 12-31-2017			10.30			0.01				2.84				2.85				(0.03	)			(1.03	)			(1.06	)
Year ended 12-31-2016			11.42			0.03				0.03				0.06				—	*			(1.18	)			(1.18	)
Year ended 12-31-2015			12.08			0.00	*			0.85				0.85				(0.01	)			(1.50	)			(1.51	)
High Income
Class I Shares
Six-month period ended 6-30-2020 (unaudited)			3.48			0.11				(0.36	)			(0.25	)			(0.25	)			—				(0.25	)
Year ended 12-31-2019			3.35			0.24				0.13				0.37				(0.24	)			—				(0.24	)
Year ended 12-31-2018			3.65			0.23				(0.29	)			(0.06	)			(0.24	)			—				(0.24	)
Year ended 12-31-2017(4)			3.73			0.16				(0.03	)			0.13				(0.21	)			—				(0.21	)
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			3.47			0.10				(0.36	)			(0.26	)			(0.24	)			—				(0.24	)
Year ended 12-31-2019			3.34			0.23				0.13				0.36				(0.23	)			—				(0.23	)
Year ended 12-31-2018			3.64			0.22				(0.29	)			(0.07	)			(0.23	)			—				(0.23	)
Year ended 12-31-2017			3.61			0.23				0.01				0.24				(0.21	)			—				(0.21	)
Year ended 12-31-2016			3.35			0.24				0.28				0.52				(0.26	)			—				(0.26	)
Year ended 12-31-2015			3.85			0.26				(0.48	)			(0.22	)			(0.24	)			(0.04	)			(0.28	)
International Core Equity
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			15.65			0.10				(1.81	)			(1.71	)			(0.34	)			—	*			(0.34	)
Year ended 12-31-2019			14.66			0.29				2.28				2.57				(0.25	)			(1.33	)			(1.58	)
Year ended 12-31-2018			18.58			0.30				(3.45	)			(3.15	)			(0.28	)			(0.49	)			(0.77	)
Year ended 12-31-2017			15.30			0.23				3.29				3.52				(0.24	)			—				(0.24	)
Year ended 12-31-2016			15.53			0.24				(0.11	)			0.13				(0.20	)			(0.16	)			(0.36	)
Year ended 12-31-2015			18.00			0.20				(0.06	)			0.14				(0.24	)			(2.37	)			(2.61	)

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 61

FINANCIAL HIGHLIGHTS IVY VIP

FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD

	Net Asset Value, End of Period			Total Return(2)			Net Assets, End of Period (in millions)				Ratio of Expenses to Average Net Assets Including Expense Waiver			Ratio of Net Investment Income (Loss) to Average Net Assets Including Expense Waiver			Ratio of Expenses to Average Net Assets Excluding Expense Waiver(3)			Ratio of Net Investment Income (Loss) to Average Net Assets Excluding Expense Waiver(3)			Portfolio Turnover Rate
Asset Strategy
Class I Shares
Six-month period ended 6-30-2020 (unaudited)		$	9.01		-4.73	%		$	—	*		0.77	%(5)		2.34	%(5)		—	%		—	%		29	%
Year ended 12-31-2019			9.50		22.08				—	*		0.77			2.19			0.77			2.19			46
Year ended 12-31-2018			8.29		-5.20				—	*		0.78			1.91			0.78			1.91			58
Year ended 12-31-2017(4)			9.37		11.16				—	*		0.74	(5)		1.30	(5)		—			—			39	(6)
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			9.00		-4.85				692			1.02	(5)		2.08	(5)		—			—			29
Year ended 12-31-2019			9.50		21.78				772			1.02			1.94			—			—			46
Year ended 12-31-2018			8.29		-5.44				753			1.03			1.65			—			—			58
Year ended 12-31-2017			9.37		18.27				936			1.02			0.35			—			—			39
Year ended 12-31-2016			8.04		-2.57				954			1.01			0.70			1.02			0.69			68
Year ended 12-31-2015			8.30		-8.35				1,268			0.98			0.81			0.99			0.80			70
Balanced
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			7.39		-3.23				308			1.03	(5)		1.19	(5)		—			—			44
Year ended 12-31-2019			8.22		22.09				341			1.01			1.38			—			—			44
Year ended 12-31-2018			7.46		-3.24				310			1.01			1.55			—			—			54
Year ended 12-31-2017			7.95		11.37				362			1.01			1.54			—			—			48
Year ended 12-31-2016			7.47		2.03				361			1.01			1.53			—			—			54
Year ended 12-31-2015			8.76		-0.32				383			1.00			1.28			—			—			44
Energy
Class I Shares
Six-month period ended 6-30-2020 (unaudited)			2.11		-46.80				—	*		1.05	(5)		1.80	(5)		1.19	(5)		1.66	(5)		30
Year ended 12-31-2019			4.02		3.74				—	*		1.04			0.64			—			—			21
Year ended 12-31-2018			3.88		-33.96				—	*		0.94			-0.09			0.94			-0.09			37
Year ended 12-31-2017(4)			5.87		1.55				—	*		0.92	(5)		1.70	(5)		—			—			22	(6)
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			2.11		-46.87				33			1.30	(5)		1.55	(5)		1.44	(5)		1.41	(5)		30
Year ended 12-31-2019			4.00		3.48				42			1.29			0.42			—			—			21
Year ended 12-31-2018			3.87		-34.14				39			1.19			-0.41			—			—			37
Year ended 12-31-2017			5.87		-12.64				169			1.19			0.75			—			—			22
Year ended 12-31-2016			6.77		34.55				196			1.19			-0.27			—			—			31
Year ended 12-31-2015			5.04		-22.14				117			1.20			0.08			—			—			34

62 SEMIANNUAL REPORT 2020

	Net Asset Value, End of Period			Total Return(2)			Net Assets, End of Period (in millions)			Ratio of Expenses to Average Net Assets Including Expense Waiver			Ratio of Net Investment Income (Loss) to Average Net Assets Including Expense Waiver			Ratio of Expenses to Average Net Assets Excluding Expense Waiver(3)			Ratio of Net Investment Income (Loss) to Average Net Assets Excluding Expense Waiver(3)			Portfolio Turnover Rate
Growth
Class II Shares
Six-month period ended 6-30-2020 (unaudited)		$	10.59		8.79	%		$	816		1.00	% (5)		-0.06	% (5)		—	%		—	%		18	%
Year ended 12-31-2019			11.33		36.59				791		1.00			-0.05			—			—			30
Year ended 12-31-2018			11.02		2.28				669		1.00			-0.02			—			—			37
Year ended 12-31-2017			12.09		29.34				883		0.99			0.05			—			—			41
Year ended 12-31-2016			10.30		1.22				835		0.98			0.26			1.00			0.24			53
Year ended 12-31-2015			11.42		7.17				897		0.96			0.03			0.99			0.00			30
High Income
Class I Shares
Six-month period ended 6-30-2020 (unaudited)			2.98		-7.07				19		0.69	(5)		6.68	(5)		—			—			24
Year ended 12-31-2019			3.48		11.49				27		0.67			6.82			—			—			35
Year ended 12-31-2018			3.35		-1.86				44		0.66			6.50			0.66			6.50			42
Year ended 12-31-2017(4)			3.65		3.42				56		0.66	(5)		6.53	(5)		—			—			52	(6)
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			2.97		-7.19				764		0.94	(5)		6.43	(5)		—			—			24
Year ended 12-31-2019			3.47		11.19				859		0.92			6.57			—			—			35
Year ended 12-31-2018			3.34		-2.11				803		0.91			6.27			—			—			42
Year ended 12-31-2017			3.64		6.68				887		0.91			6.22			—			—			52
Year ended 12-31-2016			3.61		16.19				845		0.89			6.97			0.92			6.94			36
Year ended 12-31-2015			3.35		-6.50				725		0.89			7.01			0.92			6.98			44
International Core Equity
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			13.60		-10.80				580		1.17	(5)		1.49	(5)		—			—			44
Year ended 12-31-2019			15.65		18.69				699		1.16			1.93			—			—			69
Year ended 12-31-2018			14.66		-17.81				676		1.16			1.70			—			—			51
Year ended 12-31-2017			18.58		23.16				835		1.16			1.33			—			—			59
Year ended 12-31-2016			15.30		1.08				736		1.17			1.60			—			—			77
Year ended 12-31-2015			15.53		-0.94				675		1.16			1.18			—			—			87

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 63

FINANCIAL HIGHLIGHTS IVY VIP

FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD

	Net Asset Value, Beginning of Period			Net Investment Income (Loss)(1)				Net Realized and Unrealized Gain (Loss) on Investments				Total from Investment Operations				Distributions From Net Investment Income				Distributions From Net Realized Gains				Total Distributions
Mid Cap Growth
Class I Shares
Six-month period ended 6-30-2020 (unaudited)		$	12.77		$	(0.01	)		$	1.45			$	1.44			$	—			$	(1.02	)		$	(1.02	)
Year ended 12-31-2019			11.10			(0.02	)			3.95				3.93				—				(2.26	)			(2.26	)
Year ended 12-31-2018			11.63			(0.02	)			0.09				0.07				—				(0.60	)			(0.60	)
Year ended 12-31-2017(4)			10.30			0.00	*			1.64				1.64				—				(0.31	)			(0.31	)
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			12.69			(0.03	)			1.45				1.42				—				(0.99	)			(0.99	)
Year ended 12-31-2019			11.07			(0.06	)			3.94				3.88				—				(2.26	)			(2.26	)
Year ended 12-31-2018			11.61			(0.05	)			0.09				0.04				—				(0.58	)			(0.58	)
Year ended 12-31-2017			9.44			(0.04	)			2.52				2.48				—				(0.31	)			(0.31	)
Year ended 12-31-2016			9.42			(0.01	)			0.55				0.54				—				(0.52	)			(0.52	)
Year ended 12-31-2015			10.84			(0.01	)			(0.52	)			(0.53	)			—				(0.89	)			(0.89	)
Natural Resources
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			3.84			0.03				(0.90	)			(0.87	)			(0.07	)			—				(0.07	)
Year ended 12-31-2019			3.55			0.07				0.26				0.33				(0.04	)			—				(0.04	)
Year ended 12-31-2018			4.63			0.03				(1.10	)			(1.07	)			(0.01	)			—				(0.01	)
Year ended 12-31-2017			4.50			0.00	*			0.14				0.14				(0.01	)			—				(0.01	)
Year ended 12-31-2016			3.66			0.01				0.86				0.87				(0.03	)			—				(0.03	)
Year ended 12-31-2015			4.72			0.02				(1.08	)			(1.06	)			—	*			—				—	*
Science and Technology
Class I Shares
Six-month period ended 6-30-2020 (unaudited)			29.94			(0.05	)			1.34				1.29				—				(1.32	)			(1.32	)
Year ended 12-31-2019			21.91			(0.06	)			10.95				10.89				—				(2.86	)			(2.86	)
Year ended 12-31-2018			27.04			(0.03	)			(1.24	)			(1.27	)			—				(3.86	)			(3.86	)
Year ended 12-31-2017(4)			25.22			(0.04	)			4.16				4.12				—				(2.30	)			(2.30	)

* Not shown due to rounding.

(1) Based on average weekly shares outstanding.

(2) Based on net asset value. Total returns do not reflect a sales charge or contingent deferred sales charge, if applicable. Total returns for periods less than one year are not annualized.

(3) Ratios excluding expense waivers are included only for periods in which the class had waived or reimbursed expenses.

(4) For the period from April 28, 2017 (commencement of operations of the class) through December 31, 2017.

(5) For the period from November 5, 2018 (commencement of operations of the class) through December 31, 2018.

(6) Annualized.

(7) Portfolio turnover is calculated at the fund level. Percentage indicated was calculated for the period ended December 31, 2017.

(8) Portfolio turnover is calculated at the fund level. Percentage indicated was calculated for the period ended December 31, 2018.

(9) Expense ratio based on the period excluding reorganization expenses was 0.89%.

(10) Expense ratio based on the period excluding reorganization expenses was 1.14%.

64 SEMIANNUAL REPORT 2020

	Net Asset Value, Beginning of Period			Net Investment Income (Loss)(1)				Net Realized and Unrealized Gain (Loss) on Investments				Total from Investment Operations				Distributions From Net Investment Income				Distributions From Net Realized Gains				Total Distributions
Class II Shares
Six-month period ended 6-30-2020 (unaudited)		$	29.82		$	(0.08	)		$	1.32			$	1.24			$	—			$	(1.31	)		$	(1.31	)
Year ended 12-31-2019			21.84			(0.13	)			10.90				10.77				—				(2.79	)			(2.79	)
Year ended 12-31-2018			27.04			(0.11	)			(1.23	)			(1.34	)			—				(3.86	)			(3.86	)
Year ended 12-31-2017			22.34			(0.13	)			7.08				6.95				—				(2.25	)			(2.25	)
Year ended 12-31-2016			22.96			(0.11	)			0.34				0.23				—				(0.85	)			(0.85	)
Year ended 12-31-2015			25.02			(0.15	)			(0.41	)			(0.56	)			—				(1.50	)			(1.50	)
Small Cap Core
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			13.71			(0.01	)			(2.31	)			(2.32	)			—				(0.64	)			(0.64	)
Year ended 12-31-2019			13.51			0.00	*			3.12				3.12				—				(2.92	)			(2.92	)
Year ended 12-31-2018			18.32			(0.06	)			(1.37	)			(1.43	)			(0.02	)			(3.36	)			(3.38	)
Year ended 12-31-2017			18.34			0.00	*			2.21				2.21				—				(2.23	)			(2.23	)
Year ended 12-31-2016			15.66			0.01				4.17				4.18				(0.07	)			(1.43	)			(1.50	)
Year ended 12-31-2015			17.98			0.05				(0.95	)			(0.90	)			(0.02	)			(1.40	)			(1.42	)
Small Cap Growth
Class I Shares
Six-month period ended 6-30-2020 (unaudited)			8.80			(0.02	)			0.01				(0.01	)			—				—				—
Year ended 12-31-2019			7.69			(0.05	)			1.85				1.80				—				(0.69	)			(0.69	)
Year ended 12-31-2018(5)			8.76			0.00	*			(1.07	)			(1.07	)			—				—				—
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			8.77			(0.03	)			0.01				(0.02	)			—				—				—
Year ended 12-31-2019			7.68			(0.07	)			1.85				1.78				—				(0.69	)			(0.69	)
Year ended 12-31-2018			11.63			(0.06	)			0.03				(0.03	)			(0.05	)			(3.87	)			(3.92	)
Year ended 12-31-2017			9.69			(0.07	)			2.27				2.20				—				(0.26	)			(0.26	)
Year ended 12-31-2016			10.60			(0.07	)			0.23				0.16				—				(1.07	)			(1.07	)
Year ended 12-31-2015			12.15			(0.09	)			0.51				0.42				—				(1.97	)			(1.97	)

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 65

FINANCIAL HIGHLIGHTS IVY VIP

FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD

	Net Asset Value, End of Period			Total Return(2)			Net Assets, End of Period (in millions)				Ratio of Expenses to Average Net Assets Including Expense Waiver			Ratio of Net Investment Income (Loss) to Average Net Assets Including Expense Waiver			Ratio of Expenses to Average Net Assets Excluding Expense Waiver(3)			Ratio of Net Investment Income (Loss) to Average Net Assets Excluding Expense Waiver(3)			Portfolio Turnover Rate
Mid Cap Growth
Class I Shares
Six-month period ended 6-30-2020 (unaudited)		$	13.19		11.96	%		$	211			0.85	%(6)		-0.24	%(6)		—	%		—	%		14	%
Year ended 12-31-2019			12.77		38.28				233			0.85			-0.20			0.90			-0.25			20
Year ended 12-31-2018			11.10		0.20				184			0.85			-0.14			0.90			-0.19			53
Year ended 12-31-2017(4)			11.63		16.44				131			0.85	(6)		0.05	(6)		0.89	(6)		0.01	(6)		25	(7)
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			13.12		11.82				326			1.10	(6)		-0.49	(6)		1.16	(6)		-0.55	(6)		14
Year ended 12-31-2019			12.69		37.94				315			1.10			-0.45			1.15			-0.50			20
Year ended 12-31-2018			11.07		-0.06				230			1.10			-0.42			1.15			-0.47			53
Year ended 12-31-2017			11.61		26.89				585			1.11			-0.39			1.15			-0.43			25
Year ended 12-31-2016			9.44		6.12				615			1.10			-0.09			1.15			-0.14			33
Year ended 12-31-2015			9.42		-5.78				586			1.10			-0.07			1.15			-0.12			42
Natural Resources
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			2.90		-22.73				70			1.35	(6)		1.73	(6)		—			—			38
Year ended 12-31-2019			3.84		9.46				88			1.24			1.88			—			—			36
Year ended 12-31-2018			3.55		-23.23				88			1.21			0.72			—			—			33
Year ended 12-31-2017			4.63		2.97				131			1.36			0.11			—			—			44
Year ended 12-31-2016			4.50		23.81				144			1.36			0.20			—			—			67
Year ended 12-31-2015			3.66		-22.39				114			1.35			0.54			—			—			34
Science and Technology
Class I Shares
Six-month period ended 6-30-2020 (unaudited)			29.91		4.58				2			0.91	(6)		-0.35	(6)		—			—			4
Year ended 12-31-2019			29.94		49.86				1			0.90			-0.23			—			—			31
Year ended 12-31-2018			21.91		-5.00				1			0.91			-0.11			0.91			-0.11			17
Year ended 12-31-2017(4)			27.04		17.24				—	*		0.90	(6)		-0.25	(6)		—			—			27	(7)
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			29.75		4.44				567			1.16	(6)		-0.60	(6)		—			—			4
Year ended 12-31-2019			29.82		49.48				579			1.15			-0.48			—			—			31
Year ended 12-31-2018			21.84		-5.23				429			1.16			-0.38			—			—			17
Year ended 12-31-2017			27.04		32.12				645			1.15			-0.51			—			—			27
Year ended 12-31-2016			22.34		1.54				514			1.15			-0.52			1.17			-0.54			16
Year ended 12-31-2015			22.96		-2.88				582			1.13			-0.60			1.15			-0.62			25

66 SEMIANNUAL REPORT 2020

	Net Asset Value, End of Period			Total Return(2)			Net Assets, End of Period (in millions)			Ratio of Expenses to Average Net Assets Including Expense Waiver			Ratio of Net Investment Income (Loss) to Average Net Assets Including Expense Waiver			Ratio of Expenses to Average Net Assets Excluding Expense Waiver(3)			Ratio of Net Investment Income (Loss) to Average Net Assets Excluding Expense Waiver(3)			Portfolio Turnover Rate
Small Cap Core
Class II Shares
Six-month period ended 6-30-2020 (unaudited)		$	10.75		-16.96	%		$	151		1.21	% (6)		-0.10	% (6)		—	%		—	%		92	%
Year ended 12-31-2019			13.71		24.33				188		1.18			-0.05			—			—			126
Year ended 12-31-2018			13.51		-10.49				175		1.17			-0.34			—			—			112
Year ended 12-31-2017			18.32		13.73				316		1.15			0.01			—			—			112
Year ended 12-31-2016			18.34		28.88				348		1.16			0.08			—			—			182
Year ended 12-31-2015			15.66		-5.58				318		1.15			0.26			—			—			142
Small Cap Growth
Class I Shares
Six-month period ended 6-30-2020 (unaudited)			8.79		-0.18				52		0.89	(6)		-0.46	(6)		—			—			28
Year ended 12-31-2019			8.80		23.68				58		0.89			-0.60			0.91			-0.62			41
Year ended 12-31-2018(5)			7.69		-12.24				52		1.05	(6)(9)		0.15	(6)		1.07	(6)		0.13	(6)		52	(8)
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			8.75		-0.31				315		1.14	(6)		-0.71	(6)		1.17	(6)		-0.74	(6)		28
Year ended 12-31-2019			8.77		23.37				331		1.14			-0.84			1.17			-0.87			41
Year ended 12-31-2018			7.68		-4.11				300		1.16	(10)		-0.52			1.18			-0.54			52
Year ended 12-31-2017			11.63		23.12				377		1.15			-0.69			1.17			-0.71			55
Year ended 12-31-2016			9.69		2.92				426		1.14			-0.79			1.16			-0.81			107
Year ended 12-31-2015			10.60		1.88				430		1.13			-0.76			1.15			-0.78			102

See Accompanying Notes to Financial Statements.

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NOTES TO FINANCIAL STATEMENTS IVY VIP

JUNE 30, 2020 (UNAUDITED)

1. ORGANIZATION

Ivy Variable Insurance Portfolios, a Delaware statutory trust (the “Trust”), is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. Asset Strategy, Balanced, Energy, Growth, High Income, International Core Equity, Mid Cap Growth, Natural Resources, Science and Technology, Small Cap Core and Small Cap Growth (each, a “Portfolio”) are eleven series of the Trust and are the only series of the Trust included in these financial statements. The assets belonging to each Portfolio are held separately by the custodian. The investment objective, policies and risk factors of each Portfolio are described more fully in the Prospectus and Statement of Additional Information (“SAI”). Each Portfolio’s investment adviser is Ivy Investment Management Company (“IICO”).

Each Portfolio offers Class II shares. Asset Strategy, Energy, High Income, Mid Cap Growth, Science and Technology and Small Cap Growth also offer Class I shares. All classes of shares have identical rights and voting privileges with respect to the Portfolio in general and exclusive voting rights on matters that affect that class alone. Net investment income, net assets and net asset value per share (“NAV”) may differ due to each class having its own expenses, such as transfer agent and shareholder servicing fees, directly attributable to that class. Class II shares have a distribution and service plan. Class I shares are not included in the plan.

2. SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies consistently followed by each Portfolio.

Security Transactions and Related Investment Income. Security transactions are accounted for on the trade date (date the order to buy or sell is executed). Realized gains and losses are calculated on the identified cost basis. Interest income is recorded on the accrual basis and includes paydown gain (loss) and accretion of discounts and amortization of premiums. Dividend income is recorded on the ex-dividend date, except certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Portfolio is informed of the ex-dividend date. All or a portion of the distributions received from a real estate investment trust or publicly traded partnership may be designated as a reduction of cost of the related investment or realized gain.

Foreign Currency Translation. Each Portfolio’s accounting records are maintained in U.S. dollars. All assets and liabilities denominated in foreign currencies are translated into U.S. dollars daily, using foreign exchange rates obtained from an independent pricing service approved by the Board of Trustees of the Trust (the “Board”). Purchases and sales of investment securities and accruals of income and expenses are translated at the rate of exchange prevailing on the date of the transaction. For assets and liabilities other than investments in securities, net realized and unrealized gains and losses from foreign currency translation arise from changes in currency exchange rates. Each Portfolio combines fluctuations from currency exchange rates and fluctuations in value when computing net realized gain (loss) and net change in unrealized appreciation (depreciation) on investments. Foreign exchange rates are typically valued as of the close of the New York Stock Exchange (“NYSE”), normally 4:00 P.M. Eastern time, on each day the NYSE is open for trading.

Allocation of Income, Expenses, Gains and Losses. Income, expenses (other than those attributable to a specific class), gains and losses are allocated on a daily basis to each class of shares based upon the relative proportion of net assets represented by such class. Operating expenses directly attributable to a specific class are charged against the operations of that class.

Dividends and Distributions to Shareholders. Dividends and distributions to shareholders are recorded by each Portfolio on the business day following record date. Net investment income dividends and capital gains distributions are determined in accordance with income tax regulations which may differ from accounting principles generally accepted in the United States of America (“U.S. GAAP”). If the total dividends and distributions made in any tax year exceeds net investment income and accumulated realized capital gains, a portion of the total distribution may be treated as a tax return of capital.

Income Taxes. It is the policy of each Portfolio to distribute all of its taxable income and capital gains to its shareholders and to otherwise qualify as a regulated investment company under Subchapter M of the Internal Revenue Code. In addition, each Portfolio intends to pay distributions as required to avoid imposition of excise tax. Accordingly, no provision has been made for Federal income taxes. The Portfolios file income tax returns in U.S. federal and applicable state jurisdictions. The Portfolios’ tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years after the filing of the tax returns. Management of the Trust periodically reviews all tax positions to assess whether it is more likely than not that the position would be sustained upon examination by the relevant tax authority based on the technical merits of each position. As of the date of these financial statements, management believes that no liability for unrecognized tax positions is required.

Segregation and Collateralization. In cases in which the 1940 Act and the interpretive positions of the Securities and Exchange Commission (“SEC”), the Dodd Frank Wall Street Reform and Consumer Protection Act, or the interpretive rules

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and regulations of the U.S. Commodities Futures Trading Commission require that a Portfolio either deliver collateral or segregate assets in connection with certain investments (e.g., dollar rolls, financial futures contracts, foreign currency exchange contracts, options written, securities with extended settlement periods, and swaps), the Portfolio will segregate collateral or designate on its books and records, cash or other liquid securities having a value at least equal to the amount that is required to be physically segregated for the benefit of the counterparty. Furthermore, based on requirements and agreements with certain exchanges and third party broker-dealers, each party has requirements to deliver/deposit cash or securities as collateral for certain investments. Certain countries require that cash reserves be held while investing in companies incorporated in that country. These cash reserves and cash collateral that has been pledged to cover obligations of the Portfolios under derivative contracts, if any, will be reported separately on the Statement of Assets and Liabilities as “Restricted cash”. Securities collateral pledged for the same purpose, if any, is noted on the Schedule of Investments.

Concentration of Market and Credit Risk. In the normal course of business, the Portfolios invest in securities and enter into transactions where risks exist due to fluctuations in the market (market risk) or failure of the issuer of a security to meet all its obligations (issuer credit risk). The value of securities held by the Portfolios may decline in response to certain events, including those directly involving the issuers whose securities are owned by the Portfolios; conditions affecting the general economy; overall market changes; local, regional or global political, social or economic instability; and currency and interest rate and price fluctuations. Similar to issuer credit risk, the Portfolios may be exposed to counterparty credit risk, or the risk that an entity with which the Portfolios have unsettled or open transactions may fail to or be unable to perform on its commitments. The Portfolios manage counterparty credit risk by entering into transactions only with counterparties that they believe have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties. Financial assets, which potentially expose the Portfolios to market, issuer and counterparty credit risks, consist principally of financial instruments and receivables due from counterparties. The extent of the Portfolios’ exposure to market, issuer and counterparty credit risks with respect to these financial assets is generally approximated by their value recorded on the Portfolios’ Statement of Assets and Liabilities, less any collateral held by the Portfolios.

Certain Portfolios may hold high-yield or non-investment-grade bonds, that may be subject to a greater degree of credit risk. Credit risk relates to the ability of the issuer to meet interest or principal payments or both as they become due. The Portfolios may acquire securities in default and are not obligated to dispose of securities whose issuers subsequently default.

Certain Portfolios may enter into financial instrument transactions (such as swaps, futures, options and other derivatives) that may have off-balance sheet market risk. Off-balance sheet market risk exists when the maximum potential loss on a particular financial instrument is greater than the value of such financial instrument, as reflected on the Statement of Assets and Liabilities.

If a Portfolio invests directly in foreign currencies or in securities that trade in, and receive revenues in, foreign currencies, or in financial derivatives that provide exposure to foreign currencies, it will be subject to the risk that those currencies will decline in value relative to the base currency of the Portfolio, or, in the case of hedging positions, that the Portfolio’s base currency will decline in value relative to the currency being hedged. Currency rates in foreign countries may fluctuate significantly over short periods of time for a number of reasons, including changes in interest rates, intervention (or the failure to intervene) by U.S. or foreign governments, central banks or supranational entities such as the International Monetary Fund, or by the imposition of currency controls or other political developments in the United States or abroad.

The London Interbank Offered Rate “LIBOR” is an indicative measure of the average interest rate at which major global banks could borrow from one another. LIBOR is quoted in multiple currencies and multiple time frames using data reported by private-sector banks. LIBOR is used extensively in the United States and globally as a “benchmark” or “reference rate” for various commercial and financial contracts, including corporate and municipal bonds and loans, floating rate mortgages, asset-backed securities, consumer loans, and interest rate swaps and other derivatives.

It is expected that a number of private-sector banks currently reporting information used to set LIBOR will stop doing so after 2021 when their current reporting commitment ends, which could either cause LIBOR to stop publication immediately or cause LIBOR’s regulator to determine that its quality has degraded to the degree that it is no longer representative of its underlying market.

Management believes that, with respect to any significant investments by a Portfolio in instruments linked to LIBOR, the impact on investments and discontinuation of LIBOR may represent a significant risk.

However, management acknowledges that the anticipated transition away from LIBOR will occur after 2021 and certain of the current investments will mature prior to that time. Furthermore, the ways in which LIBOR’s discontinuation potentially could impact the Portfolios’ investments is not fully known. The extent of that impact may vary depending on various factors, which include, but are not limited to: (i) existing fallback or termination provisions in individual contracts and (ii) whether, how, and when industry participants develop and adopt new successor reference rates and/or fallbacks for both legacy and new instruments.

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In addition, the transition to a successor rate could potentially cause (i) increased volatility or illiquidity in markets for instruments that currently rely on LIBOR, (ii) a reduction in the value of certain instruments held by a Portfolio, or (iii) reduced effectiveness of related Portfolio transactions, such as hedging.

As the impacts of the transition become clearer during the next year, Management will be evaluating the impacts of these changes.

An outbreak of infectious respiratory illness caused by a novel coronavirus known as COVID-19 was first detected in China in December 2019 and has now been detected globally. This coronavirus has resulted in travel restrictions, closed international borders, enhanced health screenings at ports of entry and elsewhere, disruption of and delays in healthcare service preparation and delivery, prolonged quarantines, cancellations, supply chain disruptions, and lower consumer demand, as well as general concern and uncertainty. The impact of COVID-19, and other infectious illness outbreaks that may arise in the future, could adversely affect the economies of many nations or the entire global economy, individual issuers and capital markets in ways that cannot necessarily be foreseen. In addition, the impact of infectious illnesses in emerging market countries may be greater due to generally less established healthcare systems. Public health crises caused by the COVID-19 outbreak may exacerbate other pre-existing political, social and economic risks in certain countries or globally. The duration of the COVID-19 outbreak and its effects cannot be determined with certainty.

The individual Portfolios herein have adopted a Liquidity Risk Management Program (the “Program”). The Portfolio’s board has designated a Liquidity Risk Management Committee (the “Committee”) as the administrator of the Program. The Committee or delegates of the Committee conduct the day-to-day operation of the Program. Under the Program, the Committee manages the Portfolio’s liquidity risk, which is the risk that any Portfolio could not meet shareholder redemption requests without significant dilution of remaining shareholders’ interests in the Portfolio. This risk is managed by monitoring the degree of liquidity of the Portfolio’s investments, limiting the amount of the Portfolio’s illiquid investments, and utilizing various risk management tools and facilities available to the Portfolio for meeting shareholder redemptions, among other means. The Committee’s process of determining the degree of liquidity of the Portfolio’s investments is supported by one or more third-party liquidity assessment vendors. The Portfolio’s board reviewed a report prepared by a designee of the Committee regarding the operation, adequacy and effectiveness of the Program from the period June 1, 2019, through March 31, 2020. The report described the Program’s liquidity classification methodology and the methodology in establishing a Portfolio’s Highly Liquid Investment Minimum (“HLIM”), if necessary. The Committee reported that during the period covered by the report, there were no material changes to the Program and no significant liquidity events impacting the Portfolio or its ability to timely meet redemptions without dilution to existing shareholders. In addition, the Committee provided its assessment that the Program, including the operation of each Portfolio’s HLIM, where applicable, had been effective in managing the Portfolio’s liquidity risk.

Inflation-Indexed Bonds. Certain Portfolios may invest in inflation-indexed bonds. Inflation-indexed bonds are fixed-income securities whose principal value is periodically adjusted to the rate of inflation. The interest rate on these bonds is generally fixed at issuance at a rate lower than typical bonds. Over the life of an inflation-indexed bond, however, interest will be paid based on a principal value, which is adjusted for inflation. Any increase or decrease in the principal amount of an inflation-indexed bond will be included as interest income on the Statement of Operations, even though investors do not receive their principal until maturity.

Interest Only Obligations. These securities entitle the owner to receive only the interest portion from a bond, Treasury note or pool of mortgages. These securities are generally created by a third party separating a bond or pool of mortgages into distinct interest-only and principal-only securities. As the principal (par) amount of a bond or pool of mortgages is paid down, the amount of interest income earned by the owner will decline as well.

Loans. Certain Portfolios may invest in loans, the interest rates of which float or adjust periodically based upon a specified adjustment schedule, benchmark indicator, or prevailing interest rates, the debtor of which may be a domestic or foreign corporation, partnership or other entity (“Borrower”). Loans generally pay interest at rates which are periodically redetermined by reference to a base lending rate plus a premium. These base lending rates generally include prime rates of one or more major U.S. banks, the LIBOR or certificates of deposit rates. Loans often require prepayments from excess cash flow or permit the Borrower to repay at its election. The degree to which Borrowers repay cannot be predicted with accuracy. As a result, the actual maturity may be substantially less than the stated maturities. Loans are exempt from registration under the Securities Act of 1933, as amended, may contain certain restrictions on resale, and cannot be sold publicly. A Portfolio’s investments in loans may be in the form of participations in loans or assignments of all or a portion of loans from third parties.

When a Portfolio purchases assignments, it acquires all the rights and obligations under the loan agreement of the assigning lender. Assignments may, however, be arranged through private negotiations between potential assignees and potential assignors, and the rights and obligations acquired by the purchaser of an assignment may differ from, and be more limited than those held by the assigning lender. When a Portfolio purchases a participation of a loan interest, the Portfolio typically enters into a contractual agreement with the lender or other third party selling the participation. A participation interest in

70 SEMIANNUAL REPORT 2020

loans includes the right to receive payments of principal, interest and any fees to which it is entitled from the lender and only upon receipt by the lender of payments from the Borrower, but not from the Borrower directly. When investing in a participation interest, if a Borrower is unable to meet its obligations under a loan agreement, a Portfolio generally has no direct right to enforce compliance with the terms of the loan agreement. As a result, the Portfolio assumes the credit risk of the Borrower, the selling participant, and any other persons that are interpositioned between the Portfolio and the Borrower. If the lead lender in a typical lending syndicate becomes insolvent, enters Federal Deposit Insurance Corporation (“FDIC”) receivership or, if not FDIC insured, enters into bankruptcy, the Portfolio may incur certain costs and delays in receiving payment or may suffer a loss of principal and interest.

Payment In-Kind Securities. Certain Portfolios may invest in payment in-kind securities (“PIKs”). PIKs give the issuer the option at each interest payment date of making interest payments in cash or in additional debt securities. Those additional debt securities usually have the same terms, including maturity dates and interest rates, and associated risks as the original bonds. The daily market quotations of the original bonds may include the accrued interest (referred to as a dirty price) and require a pro-rata adjustment from the unrealized appreciation or depreciation on investments to interest receivable on the Statement of Assets and Liabilities.

Securities on a When-Issued or Delayed Delivery Basis. Certain Portfolios may purchase securities on a “when-issued” basis, and may purchase or sell securities on a “delayed delivery” basis. “When-issued” or “delayed delivery” refers to securities whose terms and indenture are available and for which a market exists, but which are not available for immediate delivery. Delivery and payment for securities that have been purchased by a Portfolio on a when-issued basis normally take place within six months and possibly as long as two years or more after the trade date. During this period, such securities do not earn interest, are subject to market fluctuation and may increase or decrease in value prior to their delivery. The purchase of securities on a when-issued basis may increase the volatility of a Portfolio’s NAV to the extent the Portfolio executes such transactions while remaining substantially fully invested. When a Portfolio engages in when-issued or delayed delivery transactions, it relies on the buyer or seller, as the case may be, to complete the transaction. Their failure to do so may cause the Portfolio to lose the opportunity to obtain or dispose of the security at a price and yield IICO, or the Portfolio’s investment subadviser, as applicable, consider advantageous. The Portfolio maintains internally designated assets with a value equal to or greater than the amount of its purchase commitments. The Portfolio may also sell securities that it purchased on a when-issued or delayed delivery basis prior to settlement of the original purchase.

Custodian Fees. “Custodian fees” on the Statement of Operations may include interest expense incurred by a Portfolio on any cash overdrafts of its custodian account during the period. Such cash overdrafts may result from the effects of failed trades in portfolio securities and from cash outflows resulting from unanticipated shareholder redemption activity. A Portfolio pays interest to its custodian on such cash overdrafts, to the extent they are not offset by positive cash balances maintained by that Portfolio. The “Earnings credit” line item, if shown, represents earnings on cash balances maintained by that Portfolio during the period. Such interest expense and other custodian fees may be paid with these earnings.

Indemnification. The Trust’s organizational documents provide current and former Trustees and Officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Trust. In the normal course of business, the Trust may also enter into contracts that provide general indemnification. The Trust’s maximum exposure under these arrangements is unknown and is dependent on future claims that may be made against the Trust. The risk of material loss from such claims is considered remote.

Basis of Preparation. Each Portfolio is an investment company and follows accounting and reporting guidance in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Topic 946 (“ASC 946”). The accompanying financial statements were prepared in accordance with U.S. GAAP, including but not limited to ASC 946. U.S. GAAP requires the use of estimates made by management. Management believes that estimates and valuations are appropriate; however, actual results may differ from those estimates, and the valuations reflected in the accompanying financial statements may differ from the value ultimately realized upon sale or maturity.

Subsequent Events. Management has performed a review for subsequent events through the date this report was issued.

3. INVESTMENT VALUATION AND FAIR VALUE MEASUREMENTS

Each Portfolio’s investments are reported at fair value. Fair value is defined as the price that each Portfolio would receive upon selling an asset or would pay upon satisfying a liability in an orderly transaction between market participants at the measurement date. Each Portfolio calculates the NAV of its shares as of the close of the NYSE, normally 4:00 P.M. Eastern time, on each day the NYSE is open for trading.

For purposes of calculating the NAV, the portfolio securities and financial instruments are valued on each business day using pricing and valuation methods as adopted by the Board. Where market quotes are readily available, fair value is generally determined on the basis of the last reported sales price, or if no sales are reported, based on quotes obtained from a quotation reporting system, established market makers, or pricing services.

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Prices for fixed-income securities are typically based on quotes that are obtained from an independent pricing service approved by the Board. To determine values of fixed-income securities, the independent pricing service utilizes such factors as current quotations by broker/dealers, coupon, maturity, quality, type of issue, trading characteristics, and other yield and risk factors it deems relevant in determining valuations. Securities that cannot be valued by the independent pricing service may be valued using quotes obtained from dealers that make markets in the securities.

Short-term securities with maturities of 60 days or less are valued based on quotes that are obtained from an independent pricing service approved by the Board as described in the preceding paragraph above.

Because many foreign markets close before the NYSE, events may occur between the close of the foreign market and the close of the NYSE that could have a material impact on the valuation of foreign securities. Waddell & Reed Services Company (“WRSCO”), pursuant to procedures adopted by the Board, evaluates the impact of these events and may adjust the valuation of foreign securities to reflect the fair value as of the close of the NYSE. In addition, all securities for which values are not readily available or are deemed unreliable are appraised at fair value as determined in good faith under the supervision of the Board.

Where market quotes are not readily available, portfolio securities or financial instruments are valued at fair value, as determined in good faith by the Board or Valuation Committee pursuant to procedures approved by the Board.

Market quotes are considered not readily available in circumstances where there is an absence of current or reliable market-based data (e.g., trade information or broker quotes), including where events occur after the close of the relevant market, but prior to the NYSE close, that materially affect the values of a Portfolio’s securities or financial instruments. In addition, market quotes are considered not readily available when, due to extraordinary circumstances, the exchanges or markets on which the securities trade do not open for trading for the entire day and no other market prices are available.

The Board has delegated to WRSCO the responsibility for monitoring significant events that may materially affect the values of a Portfolio’s securities or financial instruments and for determining whether the value of the applicable securities or financial instruments should be re-evaluated in light of such significant events. IICO, pursuant to authority delegated by the Board, has established a Valuation Committee to administer and oversee the valuation process, including the use of third party pricing vendors.

The Board has adopted methods for valuing securities and financial instruments in circumstances where market quotes are not readily available. For instances in which daily market quotes are not readily available, investments may be valued, pursuant to procedures established by the Board, with reference to other securities or indices. In the event that the security or financial instrument cannot be valued pursuant to one of the valuation methods established by the Board, the value of the security or financial instrument will be determined in good faith by the Valuation Committee in accordance with the procedures adopted by the Board.

When a Portfolio uses these fair valuation methods applied by WRSCO that use significant unobservable inputs to determine its NAV, securities will be priced by a method that the Board or persons acting at its direction believe accurately reflects fair value and are categorized as Level 3 of the fair value hierarchy. These methods may require subjective determinations about the value of a security. The prices used by a Portfolio may differ from the value that will ultimately be realized at the time the securities are sold.

WRSCO is responsible for monitoring the implementation of the pricing and valuation policies through a series of activities to provide reasonable comfort of the accuracy of prices including: 1) periodic vendor due diligence meetings to review methodologies, new developments, and process at vendors, 2) daily and monthly multi-source pricing comparisons reviewed and submitted to the Valuation Committee, and 3) daily review of unpriced, stale, and variance reports with exceptions reviewed by management and the Valuation Committee.

Accounting standards establish a framework for measuring fair value and a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability. Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the reporting entity’s own assumptions about the factors that market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.

An individual investment’s fair value measurement is assigned a level based upon the observability of the inputs which are significant to the overall valuation.

The three-tier hierarchy of inputs is summarized as follows:

• Level 1 – Observable inputs such as quoted prices, available in active markets, for identical assets or liabilities.

• Level 2 – Significant other observable inputs, which may include, but are not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active,

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inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market corroborated inputs.

• Level 3 – Significant unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available, which may include assumptions made by the Board or persons acting at its direction that are used in determining the fair value of investments.

A description of the valuation techniques applied to the Portfolios’ major classes of assets and liabilities measured at fair value on a recurring basis follows:

Asset-Backed Securities and Mortgage-Backed Securities. The fair value of asset-backed securities and mortgage-backed securities are estimated using recently executed transactions and based on models that consider the estimated cash flows of each debt tranche of the issuer, establish a benchmark yield, and develop an estimated tranche specific spread to the benchmark yield based on the unique attributes of the tranche including, but not limited to, the prepayment speed assumptions and attributes of the collateral. To the extent the inputs are observable and timely, the values would be categorized in Level 2 of the fair value hierarchy, and otherwise they would be categorized as Level 3.

Bullion. The fair value of bullion is at the last settlement price at the end of each day on the board of trade or exchange upon which they are traded and are categorized in Level 1 of the fair value hierarchy.

Corporate Bonds. The fair value of corporate bonds, as obtained from an independent pricing service, is estimated using various techniques, which consider recently executed transactions in securities of the issuer or comparable issuers, market price quotations (where observable), bond spreads, fundamental data relating to the issuer, and credit default swap spreads adjusted for any basis difference between cash and derivative instruments. While most corporate bonds are categorized in Level 2 of the fair value hierarchy, in instances where lower relative weight is placed on transaction prices, quotations, or similar observable inputs, they are categorized in Level 3 of the fair value hierarchy.

Derivative Instruments. Forward foreign currency contracts are valued based upon the closing prices of the forward currency rates determined at the close of the NYSE, which are provided by an independent pricing service. Swaps derive their value from underlying asset prices, indices, reference rates and other inputs or a combination of these factors. Swaps are valued by an independent pricing service unless the price is unavailable, in which case they are valued at the price provided by a dealer in that security. Exchange-traded futures contracts are generally valued at the settlement price. Listed options are ordinarily valued at the mean of the last bid and ask price provided by an independent pricing service unless the price is unavailable, in which case they are valued at a quotation obtained from a broker-dealer. Over the counter (“OTC”) options are ordinarily valued at the mean of the last bid and ask price for a comparable listed option provided by an independent pricing service unless such a price is unavailable, in which case they are valued at a quotation obtained from a broker-dealer.

Listed derivatives that are actively traded are valued based on quoted prices from the exchange and are categorized in Level 1 of the fair value hierarchy. OTC derivative contracts include forward foreign currency contracts, swap agreements, and option contracts related to interest rates, foreign currencies, credit standing of reference entities, equity prices, or commodity prices. Depending on the product and the terms of the transaction, the fair value of the OTC derivative products are modeled taking into account the counterparties’ creditworthiness and using a series of techniques, including simulation models. Many pricing models do not entail material subjectivity because the methodologies employed do not necessitate significant judgments and the pricing inputs are observed from actively quoted markets, as is the case with interest rate swap and option contracts. OTC derivative products valued using pricing models with significant observable inputs are categorized within Level 2 of the fair value hierarchy.

Equity Securities. Equity securities traded on U.S. or foreign securities exchanges or included in a national market system are valued at the official closing price at the close of each business day unless otherwise stated below. OTC equity securities and listed securities for which no price is readily available are valued at the average of the last bid and ask prices.

Mutual funds, including investment funds, typically are valued at the NAV reported as of the valuation date.

Securities that are stated at the last reported sales price or closing price on the day of valuation taken from the primary exchange where the security is principally traded and to the extent these securities are actively traded and valuation adjustments are not applied, they are categorized in Level 1 of the fair value hierarchy.

Foreign securities, for which the primary trading market closes at the same time or after the NYSE, are valued based on quotations from the primary market in which they are traded and categorized in Level 1. Because many foreign securities markets and exchanges close prior to the close of the NYSE, closing prices for foreign securities in those markets or on those exchanges do not reflect the events that occur after that close. Certain foreign securities may be fair valued using a pricing service that considers the correlation of the trading patterns of the foreign security to the intra-day trading in the U.S. markets for investments such as American Depositary Receipts, financial futures, exchange-traded funds, and the movement of certain indices of securities based on a statistical analysis of their historical relationship; such valuations generally are categorized in Level 2.

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Preferred stock, repurchase agreements, and other equities traded on inactive markets or valued by reference to similar instruments are also generally categorized in Level 2.

Loans. Loans are valued using a price or composite price from one or more brokers or dealers as obtained from an independent pricing service. The fair value of loans is estimated using recently executed transactions, market price quotations, credit/market events, and cross-asset pricing. Inputs are generally observable market inputs obtained from independent sources. Loans are generally categorized in Level 2 of the fair value hierarchy, unless key inputs are unobservable in which case they would be categorized as Level 3.

Municipal Bonds. Municipal bonds are fair valued based on pricing models used by and obtained from an independent pricing service that take into account, among other factors, information received from market makers and broker-dealers, current trades, bid-wants lists, offerings, market movements, the callability of the bond, state of issuance, benchmark yield curves, and bond insurance. To the extent that these inputs are observable and timely, the fair values of municipal bonds would be categorized as Level 2; otherwise the fair values would be categorized as Level 3.

Restricted Securities. Restricted securities that are deemed to be Rule 144A securities and illiquid, as well as restricted securities held in non-public entities, are included in Level 3 of the fair value hierarchy to the extent that significant inputs to valuation are unobservable, because they trade infrequently, if at all and, therefore, the inputs are unobservable. Restricted securities that are valued at a discount to similar publicly traded securities may be categorized as Level 2 of the fair value hierarchy to the extent that the discount is considered to be insignificant to the fair value measurement in its entirety; otherwise they may be categorized as Level 3.

U.S. Government and Agency Securities. U.S. government and agency securities are normally valued using a model that incorporates market observable data such as reported sales of similar securities, broker quotes, yields, bids, offers, quoted market prices, and reference data. Accordingly, U.S. government and agency securities are normally categorized in Level 2 of the fair value hierarchy depending on the liquidity and transparency of the market.

Transfers from Level 2 to Level 3 occurred primarily due to the lack of observable market data due to decreased market activity or information for these securities. Transfers from Level 3 to Level 2 occurred primarily due to the increased availability of observable market data due to increased market activity or information.

For fair valuations using unobservable inputs, U.S. GAAP requires a reconciliation of the beginning to ending balances for reported fair values that presents changes attributable to total realized and unrealized gains or losses, purchases and sales, and transfers in or out of the Level 3 category during the period. In accordance with the requirements of U.S. GAAP, a fair value hierarchy and Level 3 reconciliation, if any, have been included in the Notes to the Schedule of Investments for each respective Portfolio.

Net realized gain (loss) and net unrealized appreciation (depreciation), shown on the reconciliation of Level 3 investments, if applicable, are included on the Statement of Operations in net realized gain (loss) on investments in unaffiliated and/or affiliated securities and in net change in unrealized appreciation (depreciation) on investments in unaffiliated and/or affiliated securities, respectively.

4. DERIVATIVE INSTRUMENTS ($ amounts in thousands unless indicated otherwise)

The following disclosures contain information on why and how the Portfolios use derivative instruments, the associated risks of investing in derivative instruments, and how derivative instruments affect the Portfolios’ financial positions and results of operations.

Forward Foreign Currency Contracts. All Portfolios are authorized to enter into forward foreign currency contracts (“forward contracts”) for the purchase or sale of a foreign currency at a negotiated rate at a future date. Forward contracts are reported on a schedule following the Schedule of Investments. Forward contracts are valued daily based upon the closing prices of the forward currency rates provided by an independent pricing service determined at the close of the NYSE. The resulting unrealized appreciation and depreciation is reported on the Statement of Assets and Liabilities as a receivable or payable and on the Statement of Operations within the change in unrealized appreciation (depreciation). At contract close, the difference between the original cost of the contract and the value at the close date is recorded as a realized gain (loss) on the Statement of Operations.

Risks to a Portfolio related to the use of such contracts include both market and credit risk. Market risk is the risk that the value of the forward contract will depreciate due to unfavorable changes in the exchange rates. Credit risk arises from the possibility that the counterparty will default. If the counterparty defaults, a Portfolio’s maximum loss will consist of the aggregate unrealized gain on appreciated contracts that is not collateralized.

International Core Equity and Natural Resources enter into forward foreign currency exchange contracts as an economic hedge against either specific transactions or portfolio instruments or to obtain exposure to, or hedge exposure away from foreign currencies (foreign currency exchange rate risk).

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Option Contracts. Options purchased by a Portfolio are accounted for in the same manner as portfolio securities. The cost of the underlying instruments acquired through the exercise of call options is increased by the premium paid to purchase the call. The proceeds from instruments sold through the exercise of put options are decreased by the premium paid to purchase the put.

When a Portfolio writes (sells) an option, an amount equal to the premium received by the Portfolio is recorded as a liability. The amount of the liability is subsequently adjusted to reflect the current value of the option written. When an option expires on its stipulated expiration date or a Portfolio enters into a closing purchase transaction, the Portfolio realizes a gain (or loss if the cost of a closing purchase transaction exceeds the premium received when the call option was sold), and the liability related to such option is extinguished. When a written call option is exercised, the premium is added to the proceeds from the sale of the underlying instrument in determining whether a Portfolio has realized a gain or loss. When a written put is exercised, the cost basis of the instruments purchased by a Portfolio is reduced by the amount of the premium received.

Investments in options, whether purchased or written, involve certain risks. Writing put options and purchasing call options may increase a Portfolio’s exposure to the underlying instrument. With written options, there may be times when a Portfolio will be required to purchase or sell instruments to meet its obligation under the option contract where the required action is not beneficial to the Portfolio, due to unfavorable movement of the market price of the underlying instrument.

Option contracts can be traded on a regulated exchange or traded OTC. Unlike the trades on a regulated exchange where the clearinghouse guarantees the performances of both the buyer and the seller, to the extent a Portfolio enters into OTC option transactions with counterparties, the Portfolio will be exposed to the risk that counterparties to these OTC transactions will be unable to meet their obligations under the terms of the transaction.

Asset Strategy, International Core Equity and Mid Cap Growth purchase and write call and put options to increase or decrease hedging exposure to underlying instruments (which include credit risk, equity risk, foreign currency exchange rate risk, event risk and/or interest rate risk), increase exposure to various equity markets or certain sectors, gain exposure to or facilitate trading in certain securities and/or, in the case of options written, to generate returns from options premiums.

Swap Agreements. All Portfolios are authorized to invest in swap agreements. Swap agreements are bilaterally negotiated agreements between a Portfolio and counterparty to exchange or swap investment cash flows, assets, foreign currencies or market-linked returns at specified, future intervals. Swap agreements are privately negotiated in the over-the-counter market (“OTC swaps”). If the OTC swap entered is one of the swaps identified by a relevant regulator as a swap that is required to be cleared, then it will be cleared through a third party, known as a central counterparty or derivatives clearing organization (“centrally cleared swaps”).

Swaps are marked to market daily and changes in value are recorded as unrealized appreciation (depreciation) on the Statement of Operations. Payments received or made by the Portfolio are recorded as realized gain or loss on the Statement of Operations. Any upfront premiums paid are recorded as assets and any upfront fees received are recorded as liabilities and are shown as swap premiums paid and swap premiums received, respectively, if any, on the Statement of Assets and Liabilities and amortized over the term of the swap. An early termination payment received or made at an early termination or a final payment made at the maturity of the swap is recorded as realized gain or loss on the Statement of Operations.

After a centrally cleared swap is accepted for clearing, a Portfolio may be required to deposit initial margin with a Clearing Member in the form of cash or securities. Securities deposited as initial margin, if any, are designated on the Schedule of Investments. Cash deposited as initial margin is identified on the Schedule of Investments and is recorded as restricted cash on the Statement of Assets and Liabilities.

Total return swaps involve a commitment of one party to pay periodic interest payments in exchange for a market-linked return based on a security or a basket of securities including a variety of securities or representing a particular index. To the extent the total return of the security, a basket of securities, or an index exceeds or falls short of the offsetting interest rate obligation, the Portfolio will receive a payment from or make a payment to the counterparty.

Small Cap Growth enters into total return swaps to hedge exposure to a security or market.

The creditworthiness of the counterparty with which a Portfolio enters into a swap agreement is monitored by IICO. If a counterparty creditworthiness declines, the value of the agreement would likely decline, potentially resulting in losses. If a default occurs by the counterparty to such a transaction, the Portfolio will have contractual remedies pursuant to the agreement related to the transaction. The maximum loss a Portfolio may incur consists of the aggregate unrealized gain on appreciated contracts that is not collateralized due to facts specific to certain situations (i.e., collateral may not have been posted by the counterparty due to the required collateral amount being less than the pre-agreed thresholds. Additionally, regulatory developments called stay resolutions and the ensuing required contractual amendments to the transactional documentation, including derivatives, permit the relevant regulators to preclude parties to a transaction from terminating trades, among other rights it may have in the trade agreements should a counterparty that it regulates experience financial distress. A relevant regulator also has the authority to reduce the value of certain liabilities owed by the counterparty to a

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Fund and/or convert cash liabilities of a regulated entity into equity holdings. The power given to the relevant regulators includes the ability to amend transactional agreements unilaterally, modify the maturity of eligible liabilities, reduce the amount of interest payable or change the date on which interest becomes payable, among other powers.

To prevent incurring losses due to the counterparty credit risk, IICO actively monitors the creditworthiness of the counterparties with which it has entered financial transactions. IICO consistently and frequently risk manages the credit risk of the counterparties it faces in transactions.

Collateral and rights of offset. A Portfolio mitigates credit risk with respect to OTC derivative counterparties through credit support annexes (“CSA”) included with an International Swaps and Derivatives Association, Inc. (“ISDA”) Master Agreement which is the standard contract governing all OTC derivative transactions between the Portfolio and each of its counterparties. Although it is not possible to eliminate credit risk entirely, the CSA allows the Portfolio and its counterparty to reduce their exposure to the risk of payment default by the other party by holding an amount in collateral equivalent to the realized and unrealized amount of exposure to the counterparty, which is generally held by the Portfolio’s custodian. An amount of collateral is moved to/from applicable counterparties only if the amount of collateral required to be posted surpasses both the threshold and the minimum transfer amount pre-agreed in the CSA between the Portfolio and the counterparty. See Note 2 “Segregation and Collateralization” for additional information with respect to collateral practices.

Offsetting of Assets and Liabilities. The following tables present financial instruments that are either (1) offset or (2) subject to an enforceable master netting arrangement or similar agreement as of June 30, 2020:

Assets

							Gross Amounts Not Offset on the Statement of Assets and Liabilities
Portfolio	Gross Amounts of Recognized Assets		Gross Amounts Offset on the Statement of Assets and Liabilities		Net Amounts of Assets Presented on the Statement of Assets and Liabilities		Financial Instruments and Derivatives Available for Offset			Non-Cash Collateral Received		Cash Collateral Received			Net Amount Receivable
Asset Strategy
Investments in unaffiliated securities at value*	$	86	$	—	$	86	$	(62	)	$	—	$	—		$	24
International Core Equity
Unrealized appreciation on forward foreign currency contracts(1)	$	723	$	—	$	723	$	—		$	—	$	(723	)	$	—
Natural Resources
Unrealized appreciation on forward foreign currency contracts(1)	$	19	$	—	$	19	$	(11	)	$	—	$	—		$	8
Small Cap Growth
Swap agreements, at value	$	227	$	—	$	227	$	—		$	—	$	(227	)	$	—

* Purchased options are reported as investments in unaffiliated securities on the Statement of Assets and Liabilities.

(1) Amounts include forward contracts that have an offset to an open and close contract, but have not settled. These amounts are included on the Statement of Assets and Liabilities line item for Investment securities sold receivable.

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Liabilities

							Gross Amounts Not Offset on the Statement of Assets and Liabilities
Portfolio	Gross Amounts of Recognized Liabilities		Gross Amounts Offset on the Statement of Assets and Liabilities		Net Amounts of Liabilities Presented on the Statement of Assets and Liabilities		Financial Instruments and Derivatives Available for Offset			Non-Cash Collateral Pledged		Cash Collateral Pledged		Net Amount Payable
Asset Strategy
Written options at value	$	62	$	—	$	62	$	(62	)	$	—	$	—	$	—
Natural Resources
Unrealized depreciation on forward foreign currency contracts(1)	$	137	$	—	$	137	$	(11	)	$	—	$	—	$	126

(1) Amounts include forward contracts that have an offset to an open and close contract, but have not settled. These amounts are included on the Statement of Assets and Liabilities line item for Investment securities purchased payable.

Additional Disclosure Related to Derivative Instruments

Fair values of derivative instruments as of June 30, 2020:

		Assets			Liabilities
Portfolio	Type of Risk Exposure	Statement of Assets & Liabilities Location	Value		Statement of Assets & Liabilities Location	Value
Asset Strategy	Equity	Investments in unaffiliated securities at value*	$	86	Written options at value	$	62
International Core Equity	Foreign currency	Unrealized appreciation on forward foreign currency contracts		148			—
Mid Cap Growth	Equity			—	Written options at value		1,122
Natural Resources	Foreign currency			—	Unrealized depreciation on forward foreign currency contracts		117
Small Cap Growth	Equity	Swap agreements, at value		227			—

* Purchased options are reported as investments in unaffiliated securities and are reflected on the accompanying Schedule of Investments.

Amount of realized gain (loss) on derivatives recognized on the Statement of Operations for the period ended June 30, 2020:

		Net realized gain (loss) on:
Portfolio	Type of Risk Exposure	Investments in unaffiliated securities*			Swap agreements		Futures contracts		Written options		Forward foreign currency contracts			Total
Asset Strategy	Equity	$	(311	)	$	—	$	—	$	599	$	—		$	288
International Core Equity	Equity		151			—		—		24		—			175
	Foreign currency		—			—		—		—		(950	)		(950	)
Mid Cap Growth	Equity		(2,760	)		—		—		1,393		—			(1,367	)
Natural Resources	Foreign currency		—			—		—		—		(106	)		(106	)
Small Cap Growth	Equity		—			1,330		—		—		—			1,330

* Purchased options are reported as investments in unaffiliated securities and are reflected on the accompanying Schedule of Investments.

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Change in unrealized appreciation (depreciation) on derivatives recognized on the Statement of Operations for the period ended June 30, 2020:

		Net change in unrealized appreciation (depreciation) on:
Portfolio	Type of Risk Exposure	Investments in unaffiliated securities*			Swap agreements			Futures contracts		Written options			Forward foreign currency contracts		Total
Asset Strategy	Equity	$	(57	)	$	—		$	—	$	110		$	—	$	53
International Core Equity	Foreign currency		—			—			—		—			981		981
Mid Cap Growth	Equity		—			—			—		(587	)		—		(587	)
Natural Resources	Foreign currency		—			—			—		—			784		784
Small Cap Growth	Equity		—			(382	)		—		—			—		(382	)

* Purchased options are reported as investments in unaffiliated securities and are reflected on the accompanying Schedule of Investments.

During the period ended June 30, 2020, the average derivative volume was as follows:

Portfolio	Forward foreign currency contracts(1)			Long futures contracts(2)			Short futures contracts(2)			Swap agreements(3)			Purchased options(2)			Written options(2)
Asset Strategy		$	—		$	—		$	—		$	—		$	41		$	278
International Core Equity			220			—			—			—			—			—
Mid Cap Growth			—			—			—			—			11			273
Natural Resources			169			—			—			—			—			—
Small Cap Growth			—			—			—			10,076			—			—

(1) Average absolute value of unrealized appreciation/depreciation during the period.

(2) Average value outstanding during the period.

(3) Average notional amount outstanding during the period.

5. BASIS FOR CONSOLIDATION OF THE ASSET STRATEGY PORTFOLIO

Ivy VIP ASF II, Ltd. (the “Subsidiary”), a Cayman Islands exempted company, was incorporated as a wholly owned subsidiary acting as an investment vehicle for Ivy VIP Asset Strategy (referred to as “the Portfolio” in this subsection). VIP ASF III (SBP), LLC (the “Company”), a Delaware limited liability company, was incorporated as a wholly owned company acting as an investment vehicle for the Portfolio. The Subsidiary and the Company act as investment vehicles for the Portfolio, in order to affect certain investments for the Portfolio consistent with the Portfolio’s investment objectives and policies as specified in its prospectus and SAI.

The Portfolio’s investment portfolio has been consolidated and includes the portfolio holdings of the Portfolio, its Subsidiary and the Company. The consolidated financial statements include the accounts of the Portfolio, its Subsidiary and the Company. All inter-company transactions and balances have been eliminated. A subscription agreement was entered into between the Portfolio and its Subsidiary and the Company comprising the entire issued share capital of the Subsidiary and the Company with the intent that the Portfolio will remain the sole shareholder and retain all rights. Under the Articles of Association, shares issued by the Subsidiary and the Company confer upon a shareholder the right to receive notice of, to attend and to vote at general meetings of the Subsidiary and the Company and shall confer upon the shareholder rights in a winding-up or repayment of capital and the right to participate in the profits or assets of the Subsidiary and the Company.

See the table below for details regarding the structure, incorporation and relationship as of June 30, 2020 of the Subsidiary and the Company to the Portfolio (amounts in thousands).

Subsidiary/Company	Date of Incorporation		Subscription Agreement		Portfolio Net Assets			Subsidiary/ Company Net Assets			Percentage of Portfolio Net Assets
Ivy VIP ASF II, Ltd.		1-31-13		4-10-13		$	692,576		$	47,507		6.86	%
VIP ASF III (SBP), LLC		4-9-13		4-23-13			692,576			26		0.00

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6. INVESTMENT MANAGEMENT AND PAYMENTS TO AFFILIATED PERSONS ($ amounts in thousands unless indicated otherwise)

Management Fees. IICO serves as each Portfolio’s investment adviser. The management fee is accrued daily by each Portfolio at the following annual rates as a percentage of average daily net assets:

Portfolio (M – Millions)	$0 to $500M		$500 to $1,000M		$1,000 to $1,500M		$1,500 to $2,000M		$2,000 to $3,000M		$3,000 to $5,000M		$5,000 to $10,000M		Over $10,000M
Asset Strategy		0.700		0.700		0.650		0.650		0.600		0.550		0.550		0.550
Balanced		0.700		0.700		0.650		0.650		0.600		0.550		0.550		0.550
Energy		0.850		0.850		0.830		0.830		0.800		0.760		0.760		0.760
Growth		0.700		0.700		0.650		0.650		0.600		0.550		0.550		0.550
High Income		0.625		0.600		0.550		0.500		0.500		0.500		0.500		0.500
International Core Equity		0.850		0.850		0.830		0.830		0.800		0.760		0.760		0.760
Mid Cap Growth		0.850		0.850		0.830		0.830		0.800		0.760		0.760		0.760
Natural Resources		0.850		0.850		0.830		0.830		0.800		0.760		0.730		0.700
Science and Technology		0.850		0.850		0.830		0.830		0.800		0.760		0.760		0.760
Small Cap Core		0.850		0.850		0.830		0.830		0.800		0.760		0.760		0.760
Small Cap Growth		0.850		0.850		0.830		0.830		0.800		0.760		0.760		0.760

IICO has voluntarily agreed to waive a Portfolio’s investment management fee on any Portfolio that is not subadvised on any day that the Portfolio’s net assets are less than $25 million, subject to IICO’s right to change or modify this waiver. See Expense Reimbursements and/or Waivers for more information.

Independent Trustees and Chief Compliance Officer Fees. Fees paid to the Independent Trustees can be paid in cash or deferred to a later date, at the election of the Trustees according to the Deferred Fee Agreement entered into between the Trust and the Trustee(s). Each Portfolio records its portion of the deferred fees as a liability on the Statement of Assets and Liabilities. All fees paid in cash plus any appreciation (depreciation) in the underlying deferred plan are shown on the Statement of Operations. Additionally, fees paid to the Chief Compliance Officer of the Portfolios are shown on the Statement of Operations.

Accounting Services Fees. The Trust has an Accounting and Administrative Services Agreement with Waddell & Reed Services Company (“WRSCO”), doing business as WI Services Company (“WISC”). Under the agreement, WISC acts as the agent in providing bookkeeping and accounting services and assistance to the Trust, including maintenance of Portfolio records, pricing of Portfolio shares and preparation of certain shareholder reports. For these services, each Portfolio pays WISC a monthly fee of one-twelfth of the annual fee based on the average net asset levels shown in the following table:

(M – Millions)	$0 to $10M		$10 to $25M		$25 to $50M		$50 to $100M		$100 to $200M		$200 to $350M		$350 to $550M		$550 to $750M		$750 to $1,000M		Over $1,000M
Annual Fee Rate	$	0.00	$	11.50	$	23.10	$	35.50	$	48.40	$	63.20	$	82.50	$	96.30	$	121.60	$	148.50

Each Portfolio also pays WISC a monthly administrative fee at the annual rate of 0.01%, or one basis point, for the first $1 billion of net assets with no fee charged for net assets in excess of $1 billion. This fee is voluntarily waived by WISC until a Portfolio’s net assets are at least $10 million and is included in “Accounting services fee” on the Statement of Operations.

Shareholder Servicing. Under the Transfer Agency Agreement between the Trust and WISC, each Portfolio reimburses WISC for certain out-of-pocket costs.

Service Plan. Class II. Under a Service Plan adopted by the Trust pursuant to Rule 12b–1 under the 1940 Act, each Portfolio may pay a service fee to Ivy Distributors, Inc. (“IDI”) for Class II shares in an amount not to exceed 0.25% of the Portfolio’s average annual net assets. The fee is to be paid to compensate IDI for amounts it expends in connection with the provision of personal services to Policyowners and/or maintenance of Policyowner accounts.

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Expense Reimbursements and/or Waivers. IICO, the Portfolios’ investment manager, IDI, the Portfolios’ distributor, and/or Waddell & Reed Services Company, doing business as WISC, the Portfolios’ transfer agent, have contractually agreed to reimburse sufficient management fees, 12b-1 fees and/or shareholder servicing fees to cap the total annual ordinary fund operating expenses (which would exclude interest, taxes, brokerage commissions, acquired fund fees and expenses, and extraordinary expenses, if any). Portfolio and class expense limitations and related waivers/reimbursements for the period ended June 30, 2020 were as follows:

Fund Name	Share Class Name	Type of Expense Limit	Commencement Date	End Date	Expense Limit	Amount of Expense Waiver/ Reimbursement				Expense Reduced
Asset Strategy	Class I	Contractual	4-28-2017	4-30-2021	Class II less 0.25%		$	—		N/A
Energy	Class I	Contractual	4-28-2017	4-30-2021	Class II less 0.25%		$	21		Shareholder Servicing
High Income	Class I	Contractual	4-28-2017	4-30-2021	Class II less 0.25%		$	—		N/A
Mid Cap Growth	All Classes	Contractual	4-28-2017	4-30-2021	N/A		$	153	(1)	Investment Management Fee
	Class I	Contractual	4-28-2017	4-30-2021	0.85%		$	—	*	Shareholder Servicing
	Class I	Contractual	4-28-2017	4-30-2021	Class II less 0.25%		$	—		N/A
	Class II	Contractual	5-1-2012	4-30-2021	1.10%		$	1		12b-1 Fees and/or Shareholder Servicing
Science and Technology	Class I	Contractual	4-28-2017	4-30-2021	Class II less 0.25%		$	—		N/A
Small Cap Growth	All Classes	Contractual	4-28-2017	4-30-2021	N/A		$	63	(1)	Investment Management Fee
	Class I	Contractual	11-5-2018	4-30-2021	Class II less 0.25%		$	1		Shareholder Servicing
	Class II	Contractual	10-1-2016	4-30-2021	1.14%		$	—	*	12b-1 Fees and/or Shareholder Servicing

* Not shown due to rounding.

(1) Due to Class I and/or Class II contractual expense limits, investment management fees were waived for all share classes.

Any amounts due to the Portfolios as a reimbursement but not paid as of June 30, 2020 are shown as a receivable from affiliates on the Statement of Assets and Liabilities.

7. RELATED PARTY TRANSACTIONS (All amounts in thousands)

Certain Portfolios are permitted to purchase or sell securities from or to certain affiliated funds under specified conditions outlined in procedures adopted by the Board. The procedures have been designed to ensure that any purchase or sale of securities by the Portfolios from or to another fund or portfolio that are, or could be, considered an affiliate by virtue of having a common investment adviser (or affiliated investment advisers), common Trustees or common officers, complies with Rule 17a-7 under the Act. Further, as defined under such procedures, each transaction is effected at the current market price. During the period ended June 30, 2020, the Portfolio below engaged in purchases and sales of securities pursuant to Rule 17a-7 under the Act (amounts in thousands):

Portfolio	Purchases		Sales
High Income	$	14,181	$	—

8. INTERFUND LENDING PROGRAM

Pursuant to an exemptive order issued by the SEC (“Order”), the Ivy Funds, Ivy Variable Insurance Portfolios and InvestEd Portfolios (collectively, the “Funds” only for purposes of this footnote 8) have the ability to lend money to, and borrow money from, each other pursuant to a master interfund lending agreement (“Interfund Lending Program”). Under the Interfund Lending Program, the Funds may lend or borrow money for temporary purposes directly to or from one another (each an “Interfund Loan”), subject to meeting the conditions of the Order. The interest rate to be charged on an Interfund Loan is the average of the overnight repurchase agreement rate and the short-term bank loan rate. The Funds made no Interfund Loans under the Interfund Lending Program during the period ended June 30, 2020.

80 SEMIANNUAL REPORT 2020

9. AFFILIATED COMPANY TRANSACTIONS (All amounts in thousands)

A summary of the transactions in affiliated companies during the period ended June 30, 2020 follows:

Portfolio	12-31-19 Value		Gross Additions		Gross Reductions		Realized Gain/(Loss)		Net Change in Unrealized Depreciation			6-30-20 Value		Distributions Received		Capital Gain Distributions
High Income
Larchmont Resources LLC(1)(2)(3)	$	252	$	—	$	—	$	—	$	(207	)	$	45	$	—	$	—
	12-31-19 Value													Interest Received
Larchmont Resources LLC (8.000% Cash or 8.000% PIK), 8.000%, 8-7-20(2)(4)	$	697		—		—		—	$	(318	)	$	379	$	33	$	—

(1) No dividends were paid during the preceding 12 months.

(2) Securities whose value was determined using significant unobservable inputs.

(3) Restricted security.

(4) Payment-in-kind bond.

10. INVESTMENT SECURITIES TRANSACTIONS ($ amounts in thousands)

The cost of purchases and the proceeds from maturities and sales of investment securities (excluding short-term securities) for the period ended June 30, 2020, were as follows:

	Purchases				Sales
	U.S. Government		Other Issuers		U.S. Government		Other Issuers
Asset Strategy	$	2,875	$	181,737	$	10,220	$	200,622
Balanced		24,345		108,605		64,994		89,207
Energy		—		18,255		—		9,009
Growth		—		135,972		—		180,442
High Income		—		217,056		—		180,834
International Core Equity		—		251,994		—		280,997
Mid Cap Growth		—		68,489		—		112,892
Natural Resources		—		27,379		—		25,206
Science and Technology		—		19,580		—		75,611
Small Cap Core		—		145,823		—		149,757
Small Cap Growth		—		96,442		—		124,422

11. LOANS OF PORTFOLIO SECURITIES ($ amounts in thousands)

Each Portfolio may lend their portfolio securities only to borrowers that are approved by the Portfolio’s securities lending agent, The Bank of New York Mellon (“BNYM”). The borrower pledges and maintains with the Portfolio collateral consisting of cash or securities issued or guaranteed by the U.S. government. The collateral received by the Portfolio is required to have a value of at least 102% of the market value of the loaned securities for securities traded on U.S. exchanges and a value of at least 105% of the market value for all other securities, except in the case of loans of foreign securities which are denominated and payable in U.S. dollars, in which case the collateral is required to have a value of at least 102% of the market value of the loaned securities. The market value of the loaned securities is determined at the close of each business day and any additional required collateral is delivered to the Portfolio and any excess collateral is returned by the Portfolio on the next business day. During the term of the loan, the Portfolio is entitled to all distributions made on or in respect of the loaned securities but does not receive interest income on securities received as collateral. Loans of securities are terminable at any time and the borrower, after notice, is required to return borrowed securities within the standard time period for settlement of securities transactions.

Cash received as collateral for securities on loan may be reinvested in the Dreyfus Institutional Preferred Government Money Market Fund — Institutional Shares or certain other registered money market funds and are disclosed in the Portfolio’s Schedule of Investments and are reflected in the Statement of Assets and Liabilities as cash collateral on securities loaned at value. Non-cash collateral, in the form of securities issued or guaranteed by the U.S. government or its agencies or instrumentalities, is not disclosed in the Portfolio’s Statement of Assets and Liabilities as it is held by the lending agent on behalf of the Portfolio and the Portfolio does not have the ability to re-hypothecate these securities. The securities on loan for each Portfolio are also disclosed in its Schedule of Investments. The total value of any securities on loan as of June 30, 2020 and the total value of the related cash collateral are disclosed in the Statement of Assets and Liabilities. Income earned by the Portfolios from securities lending activity is disclosed in the Statements of Operations.

2020 SEMIANNUAL REPORT 81

The following is a summary of each Portfolio’s securities lending positions and related cash and non-cash collateral received as of June 30, 2020:

Portfolio	Market Value of Securities on Loan		Cash Collateral Received		Non-Cash Collateral Received		Total Collateral Received
Asset Strategy	$	16,835	$	17,625	$	—	$	17,625
Balanced		147		150		—		150
Energy		541		560		—		560
High Income		3,802		3,889		—		3,889
International Core Equity		20,376		15,859		5,619		21,478
Mid Cap Growth		3,419		3,497		—		3,497
Science and Technology		5,939		—		6,060		6,060
Small Cap Core		549		563		—		563
Small Cap Growth		2,746		2,801		—		2,801

The cash collateral received amounts presented in the table above are transactions accounted for as secured borrowings and have an overnight and continuous maturity. The proceeds from the cash collateral received is invested in registered money market funds.

The risks of securities lending include the risk that the borrower may not provide additional collateral when required or may not return the securities when due. To mitigate these risks, the Portfolios benefit from a borrower indemnity provided by BNYM. BNYM’s indemnity allows for full replacement of securities lent wherein BNYM will purchase the unreturned loaned securities on the open market by applying the proceeds of the collateral or to the extent such proceeds are insufficient or the collateral is unavailable, BNYM will purchase the unreturned loan securities at BNYM’s expense. However, the Portfolio could suffer a loss if the value of the investments purchased with cash collateral falls below the value of the cash collateral received.

12. BORROWINGS

On July 1, 2019 the Trust, on behalf of High Income, along with certain other funds managed by the investment adviser (“Participating Funds”), entered into a 364-day senior unsecured revolving credit facility with Bank of New York Mellon and a group of financial institutions to be utilized to temporarily finance the repurchase or redemption of Fund shares and for other temporary or emergency purposes. The Participating Funds can borrow up to an aggregate commitment amount of $130 million at any time outstanding, subject to asset coverage and other limitations as specified in the agreement. The credit facility has the following terms: a commitment fee of 0.15% per annum of the daily amount of unused commitment amounts and interest at a rate equal to the higher of (a) the federal funds effective rate (but not below 0.0%) plus 1.00% per annum or (b) the one-month LIBOR rate (but not below 0.0%) plus 1.00% per annum on amounts borrowed. The agreement expires in June 2021 unless extended or renewed. As of June 30, 2020, if applicable, any outstanding borrowings would be disclosed as a payable for borrowing on the Statement of Assets and Liabilities. Commitment and interest fees, if any, paid by the Participating Funds are disclosed as part of commitment and interest expense for borrowing on the Statement of Operations. During the period ended June 30, 2020, the Participating Funds did not borrow under the credit facility.

82 SEMIANNUAL REPORT 2020

13. CAPITAL SHARE TRANSACTIONS (All amounts in thousands)

The Trust has authorized an unlimited number of no par value shares of beneficial interest. Transactions in shares of beneficial interest were as follows:

	Asset Strategy												Balanced
	Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19						Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19
	Shares			Value			Shares			Value			Shares			Value			Shares			Value
Shares issued from sale of shares:
Class I		—		$	—			—		$	—			N/A			N/A			N/A			N/A
Class II		1,524			12,950			1,784			16,459			801		$	6,003			1,682		$	13,146
Shares issued in reinvestment of distributions to shareholders:
Class I		—	*		1			2			20			N/A			N/A			N/A			N/A
Class II		364			3,106			4,849			45,846			3,038			21,608			4,279			31,681
Shares redeemed:
Class I		—	*		—	*		—	*		—	*		N/A			N/A			N/A			N/A
Class II		(6,238	)		(54,606	)		(16,162	)		(148,939	)		(3,644	)		(27,378	)		(6,122	)		(47,906	)
Net increase (decrease)		(4,350	)	$	(38,549	)		(9,527	)	$	(86,614	)		195		$	233			(161	)	$	(3,079	)
	Energy												Growth
	Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19						Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19
	Shares			Value			Shares			Value			Shares			Value			Shares			Value
Shares issued from sale of shares:
Class I		11		$	22			5		$	21			N/A			N/A			N/A			N/A
Class II		9,604			19,245			4,050			16,320			5,130		$	54,541			936		$	10,589
Shares issued in reinvestment of distributions to shareholders:
Class I		1			2			—			—			N/A			N/A			N/A			N/A
Class II		110			234			—			—			11,225			112,473			18,896			186,937
Shares redeemed:
Class I		(2	)		(4	)		(9	)		(34	)		N/A			N/A			N/A			N/A
Class II		(4,597	)		(10,871	)		(3,772	)		(15,434	)		(9,065	)		(95,453	)		(10,740	)		(120,227	)
Net increase		5,127		$	8,628			274		$	873			7,290		$	71,561			9,092		$	77,299
	High Income												International Core Equity
	Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19						Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19
	Shares			Value			Shares			Value			Shares			Value			Shares			Value
Shares issued from sale of shares:
Class I		909		$	2,754			765		$	2,711			N/A			N/A			N/A			N/A
Class II		19,026			59,562			26,909			92,614			4,592		$	55,575			2,003		$	30,385
Shares issued in reinvestment of distributions to shareholders:
Class I		501			1,439			936			3,156			N/A			N/A			N/A			N/A
Class II		19,910			57,106			16,418			55,287			1,149			14,681			4,945			70,370
Shares redeemed:
Class I		(2,970	)		(9,959	)		(7,167	)		(24,449	)		N/A			N/A			N/A			N/A
Class II		(29,177	)		(91,727	)		(36,409	)		(125,215	)		(7,766	)		(102,964	)		(8,396	)		(126,858	)
Net increase (decrease)		8,199		$	19,175			1,452		$	4,104			(2,025	)	$	(32,708	)		(1,448	)	$	(26,103	)

* Not shown due to rounding.

2020 SEMIANNUAL REPORT 83

	Mid Cap Growth												Natural Resources
	Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19						Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19
	Shares			Value			Shares			Value			Shares			Value			Shares			Value
Shares issued from sale of shares:
Class I		1,969		$	21,327			1,304		$	16,178			N/A			N/A			N/A			N/A
Class II		2,143			25,908			5,186			64,074			3,124		$	8,511			3,518		$	13,191
Shares issued in reinvestment of distributions to shareholders:
Class I		1,323			16,217			3,171			35,378			N/A			N/A			N/A			N/A
Class II		1,888			23,025			4,217			46,820			586			1,678			229			870
Shares redeemed:
Class I		(5,512	)		(66,935	)		(2,828	)		(34,889	)		N/A			N/A			N/A			N/A
Class II		(3,990	)		(49,217	)		(5,347	)		(66,009	)		(2,508	)		(7,449	)		(5,896	)		(22,418	)
Net increase (decrease)		(2,179	)	$	(29,675	)		5,703		$	61,552			1,202		$	2,740			(2,149	)	$	(8,357	)
	Science and Technology												Small Cap Core
	Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19						Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19
	Shares			Value			Shares			Value			Shares			Value			Shares			Value
Shares issued from sale of shares:
Class I		28		$	831			5		$	144			N/A			N/A			N/A			N/A
Class II		1,519			41,762			2,087			58,421			973		$	10,151			564		$	7,839
Shares issued in reinvestment of distributions to shareholders:
Class I		2			46			3			80			N/A			N/A			N/A			N/A
Class II		859			24,127			1,692			49,737			822			8,739			2,817			36,690
Shares redeemed:
Class I		(3	)		(83	)		—	*		(17	)		N/A			N/A			N/A			N/A
Class II		(2,762	)		(78,647	)		(3,995	)		(110,540	)		(1,408	)		(15,788	)		(2,655	)		(36,555	)
Net increase (decrease)		(357	)	$	(11,964	)		(208	)	$	(2,175	)		387		$	3,102			726		$	7,974
	Small Cap Growth
	Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19
	Shares			Value			Shares			Value
Shares issued from sale of shares:
Class I		1,111		$	7,824			477		$	4,296
Class II		1,150			9,018			2,202			19,523
Shares issued in reinvestment of distributions to shareholders:
Class I		—			—			489			4,305
Class II		—			—			2,841			24,945
Shares redeemed:
Class I		(1,754	)		(14,020	)		(1,198	)		(10,725	)
Class II		(2,943	)		(24,201	)		(6,327	)		(56,749	)
Net decrease		(2,436	)	$	(21,379	)		(1,516	)	$	(14,405	)

* Not shown due to rounding.

14. COMMITMENTS

Bridge loan commitments may obligate a Portfolio to furnish temporary financing to a borrower until permanent financing can be arranged. In connection with these commitments, the Portfolio earns a commitment fee, typically set as a percentage of the commitment amount. Such fee income is included in interest income on the Statements of Operations. At June 30, 2020, there were no outstanding bridge loan commitments.

84 SEMIANNUAL REPORT 2020

15. FEDERAL INCOME TAX MATTERS ($ amounts in thousands)

For Federal income tax purposes, cost of investments owned at June 30, 2020 and the related unrealized appreciation (depreciation) were as follows:

Portfolio	Cost of Investments		Gross Appreciation		Gross Depreciation		Net Unrealized Appreciation (Depreciation)
Asset Strategy	$	719,080	$	101,270	$	110,395	$	(9,125	)
Balanced		288,421		36,744		16,649		20,095
Energy		50,170		713		17,587		(16,874	)
Growth		550,984		284,264		18,684		265,580
High Income		937,593		11,687		144,779		(133,092	)
International Core Equity		631,409		42,194		79,245		(37,051	)
Mid Cap Growth		379,750		190,319		23,493		166,826
Natural Resources		80,437		6,516		17,250		(10,734	)
Science and Technology		304,816		267,889		4,563		263,326
Small Cap Core		157,523		9,141		15,208		(6,067	)
Small Cap Growth		295,113		86,144		15,350		70,794

For Federal income tax purposes, the Portfolios’ undistributed earnings and profit for the year ended December 31, 2019 and the post-October and late-year ordinary activity updated with information available through the date of this report were as follows:

Portfolio	Undistributed Ordinary Income		Undistributed Long-Term Capital Gains		Tax Return of Capital		Post- October Capital Losses Deferred		Late-Year Ordinary Losses Deferred
Asset Strategy	$	1,311	$	1,768	$	—	$	—	$	—
Balanced		4,355		17,231		—		—		—
Energy		168		—		—		—		—
Growth		13,692		98,774		—		—		—
High Income		58,257		—		—		—		—
International Core Equity		14,565		111		—		—		—
Mid Cap Growth		5,351		33,888		—		—		—
Natural Resources		1,603		—		—		—		—
Science and Technology		992		23,177		—		—		—
Small Cap Core		1,998		6,738		—		—		—
Small Cap Growth		—		—		—		147		—

Internal Revenue Code regulations permit each Portfolio to elect to defer into its next fiscal year capital losses and certain specified ordinary items incurred between each November 1 and the end of its fiscal year. Each Portfolio is also permitted to defer into its next fiscal certain ordinary losses that generated between each January 1 and the end of its fiscal year.

The tax character of dividends and distributions paid during the two fiscal years ended December 31, 2019 and 2018 were as follows:

	December 31, 2019				December 31, 2018
Portfolio	Distributed Ordinary Income(1)		Distributed Long-Term Capital Gains		Distributed Ordinary Income(1)		Distributed Long-Term Capital Gains
Asset Strategy	$	15,765	$	30,101	$	15,495	$	33,725
Balanced		6,330		25,351		5,473		5,390
Energy		—		—		—		—
Growth		4,140		182,797		811		99,017
High Income		58,443		—		59,518		—
International Core Equity		13,997		56,373		28,472		4,508
Mid Cap Growth		—		82,198		2,816		26,847
Natural Resources		870		—		351		—
Science and Technology		1,227		48,590		—		65,685
Small Cap Core		12,737		23,953		27,706		28,529
Small Cap Growth		—		29,250		20,961		97,032

(1) Includes short-term capital gains, if any.

2020 SEMIANNUAL REPORT 85

Dividends from net investment income and short-term capital gains are treated as ordinary income dividends for federal income tax purposes.

Accumulated capital losses represent net capital loss carryovers as of December 31, 2019 that may be available to offset future realized capital gains and thereby reduce future capital gains distributions. As of December 31, 2019, the capital loss carryovers were as follows:

Portfolio	Short-Term Capital Loss Carryover			Long-Term Capital Loss Carryover
Asset Strategy	$	—		$	—
Balanced		—			—
Energy		11,755	(1)		26,541	(1)
Growth		—			—
High Income		—			61,563
International Core Equity		—			—
Mid Cap Growth		—			—
Natural Resources		7,291			45,325
Science and Technology		—			—
Small Cap Core		—			—
Small Cap Growth		—			—

(1) $29,983 of these Capital Loss Carryovers are subject to an annual limitation of $3,708 plus any unused limitation from prior years.

86 SEMIANNUAL REPORT 2020

PROXY VOTING INFORMATION IVY VIP

(UNAUDITED)

Proxy Voting Guidelines

A description of the policies and procedures Ivy Variable Insurance Portfolios uses to determine how to vote proxies relating to portfolio securities is available (i) without charge, upon request, by calling 1.888.923-3355 and (ii) on the Securities and Exchange Commission’s (“SEC”) website at www.sec.gov.

Proxy Voting Records

Information regarding how the Portfolio voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on Form N-PX at www.ivyinvestments.com and on the SEC’s website at www.sec.gov.

2020 SEMIANNUAL REPORT 87

QUARTERLY PORTFOLIO SCHEDULE INFORMATION IVY VIP

(UNAUDITED)

Portfolio holdings can be found on the Trust’s website at www.ivyinvestments.com. Alternatively, a complete schedule of portfolio holdings of each Portfolio for the first and third quarters of each fiscal year is filed with the SEC and can be found on the Trust’s Form N-Q and/or Form NPORT-EX. These holdings may be viewed in the following ways:

• On the SEC’s website at www.sec.gov.

• For review and copy at the SEC’s Public Reference Room in Washington, DC. Information on the operations of the Public Reference Room may be obtained by calling 1.800.SEC.0330.

88 SEMIANNUAL REPORT 2020

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2020 SEMIANNUAL REPORT 89

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90 SEMIANNUAL REPORT 2020

THE IVY FUNDS VARIABLE INSURANCE PORTFOLIOS FAMILY

Global/International Portfolios

Global Equity Income

Global Growth

International Core Equity

Domestic Equity Portfolios

Core Equity

Growth

Mid Cap Growth

Small Cap Core

Small Cap Growth

Value

Fixed Income Portfolios

Corporate Bond

Global Bond

High Income

Limited-Term Bond

Money Market Portfolio

Government Money Market

Specialty Portfolios

Asset Strategy

Balanced

Energy

Natural Resources

Pathfinder Aggressive

Pathfinder Conservative

Pathfinder Moderate

Pathfinder Moderately Aggressive

Pathfinder Moderately Conservative

Pathfinder Moderate — Managed Volatility

Pathfinder Moderately Aggressive — Managed Volatility

Pathfinder Moderately Conservative — Managed Volatility

Science and Technology

Securian Real Estate Securities

The underlying portfolios discussed in this report are only available as investment options in variable annuity and variable life insurance contracts issued by life insurance companies. They are not offered or made available directly to the general public.

This report is submitted for the general information of the shareholders of Ivy Variable Insurance Portfolios. It is not authorized for distribution to prospective investors in a Portfolio unless accompanied with or preceded by the current Portfolio prospectus as well as the variable product prospectus.

2020 SEMIANNUAL REPORT 91

SEMIANN-VIP1 (06/20)

  VARIABLE INSURANCE PORTFOLIOS   Semiannual Report   JUNE 30, 2020

Ivy Variable Insurance Portfolios
Core Equity	Class II
Corporate Bond	Class II
Global Bond	Class II
Global Equity Income	Class II
Global Growth	Class II
Limited-Term Bond	Class II
Securian Real Estate Securities	Class II
Value	Class II

Beginning on January 1, 2021, as permitted by regulations adopted by the U.S. Securities and Exchange Commission (SEC), you may not be receiving paper copies of the Fund’s annual or semi-annual shareholder reports by mail, unless you specifically request paper copies of the reports from the insurance company that offers your variable annuity or variable life insurance contract or from your financial intermediary. Instead of delivering paper copies of the report, the insurance company may choose to make the reports available on a website, and will notify you by mail each time a shareholder report is posted and provide you with a website link to access the report. Instructions for requesting paper copies will be provided by your insurance company.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the insurance company or your financial intermediary electronically by following the instructions provided by the insurance company or by contacting your financial intermediary.

You may elect to receive all future Fund shareholder reports in paper free of charge from the insurance company. You can inform the insurance company or your financial intermediary that you wish to continue receiving paper copies of your shareholder reports by following the instructions provided by the insurance company or by contacting your financial intermediary. Your election to receive reports in paper will apply to all portfolio companies available under your contract with the insurance company.

CONTENTS IVY VIP

President’s Letter	3
Illustration of Portfolio Expenses	4
Portfolio Highlights and Schedule of Investments:	6
Core Equity	6
Corporate Bond	9
Global Bond	17
Global Equity Income	23
Global Growth	26
Limited-Term Bond	29
Securian Real Estate Securities	34
Value	37
Statements of Assets and Liabilities	40
Statements of Operations	41
Statements of Changes in Net Assets	42
Financial Highlights	44
Notes to Financial Statements	48
Proxy Voting Information	62
Quarterly Portfolio Schedule Information	63

2 SEMIANNUAL REPORT 2020

PRESIDENT’S LETTER IVY VIP

	JUNE 30, 2020 (UNAUDITED)
Philip J. Sanders, CFA

Dear Shareholder,

Markets thus far in 2020 have been, to use an overused word, unprecedented. In a matter of months, we have witnessed economic and market moves that typically take an entire market cycle of many years to unfold. Financial markets had been positive in early 2020, as political conflicts, trade uncertainty and global economic growth concerns waned. However, that upward trajectory suddenly reversed in late February 2020 and markets declined in response to two exogenous shocks: the COVID-19 pandemic and the collapse in energy markets. The COVID-19 pandemic caused one of the most rapid and dramatic global economic downturns in history. The U.S. stock markets dropped approximately 35% from peak in February to trough in late March. Global economic activity hit a full stop around the world, as countries and businesses implemented plans to isolate and protect each other. The pause on economic activity, along with a conflict between Russia and Saudi Arabia, caused a historic rout in oil markets. Remarkably, within about 30 days, we moved from a relatively strong domestic economy with financial market indexes hitting record highs, to a global recession.

Governments and central banks have taken unprecedented steps to mitigate the economic blow of social distancing. Monetary policy response has been broader and more rapid than at any other time in history. Global central banks have enacted aggressive stimulus through lower interest rates, quantitative easing (QE) and liquidity provisions, with some developing countries implementing QE for the first time. The U.S. Federal Reserve’s (Fed) response has been the strongest with a broad array of policy measures including an unprecedented pace of QE.

Just as global central banks are acting aggressively, governments around the world are responding with fiscal stimulus. While projected budget deficits for many countries are huge, those figures include loans designed to keep companies afloat and people employed. Up to this point, the fiscal impulse for most major countries is between 5 and 10% of gross domestic product (GDP). This is extremely aggressive both in size and speed of implementation, as we have only been facing this pandemic for a few months. More global fiscal stimulus seems probable. For instance, in addition to the $2.2 trillion CARES (Coronavirus Aid, Relief and Economic Security) Act, we expect another large fiscal stimulus in the U.S. to become law, which will likely include some form of extension to unemployment benefits and provide aid to state and local governments.

Enthusiasm about the economy possibly regaining momentum has been muted by ongoing uncertainty regarding the public health risks of reopening. While volatility has retreated sharply from the record highs of late March, it remains at elevated levels. Recent moves have

shown that markets are likely to respond to changes in new COVID-19 cases, both positively and negatively. Since the March 23 trough, the S&P 500 Index has stabilized and experienced a rapid bounce back. Year-to-date as of June 30, the Index is down 3.1%. Given this rebound, investors might wonder if the market is ahead of itself.

As we move forward and examine the investment landscape, we continue to put greater emphasis on the fundamentals and quality of asset classes and sectors. We believe it is important to stay focused on the merits of individual market sectors, industries and company business models when making investment decisions. Those fundamentals historically have tended to outweigh external factors. In today’s environment, we believe there are many high-quality businesses offering attractive entry points and cyclicals that will likely be key beneficiaries as economies continue to recover. Importantly, through this uncertain time, we remain focused on the innovation and management skill within individual companies, the ultimate drivers of long-term stock prices.

Economic Snapshot

	6/30/2020			12/31/2019
S&P 500 Index		3,100.29			3,230.78
MSCI EAFE Index		1,780.58			2,036.94
10-Year Treasury Yield		0.66	%		1.92	%
U.S. unemployment rate		11.1	%		3.5	%
30-year fixed mortgage rate		3.13	%		3.74	%
Oil price per barrel		$39.27			$61.14

Sources: Bloomberg, U.S. Department of Labor, MBA, CME

All government statistics shown are subject to periodic revision. The S&P 500 Index is an unmanaged index that tracks the stocks of 500 primarily large-cap U.S. companies. MSCI EAFE Index is an unmanaged index comprised of securities that represent the securities markets in Europe, Australasia and the Far East. It is not possible to invest directly in any of these indexes. Mortgage rates are from BankRate and reflect the overnight national average rate on a conventional 30-year fixed loan. Oil prices reflect the market price of West Texas intermediate grade crude.

Respectfully,

Philip J. Sanders, CFA

President

The opinions expressed in this letter are those of the President of the Ivy Variable Insurance Portfolios and are current only through the end of the period of the report, as stated on the cover. The President’s views are subject to change at any time, based on market and other conditions, and no forecasts can be guaranteed.

2020 SEMIANNUAL REPORT 3

ILLUSTRATION OF PORTFOLIO EXPENSES IVY VIP

(UNAUDITED)

Expense Example

As a shareholder of a Portfolio, you incur ongoing costs, including management fees, distribution and service fees, and other Portfolio expenses. The following table is intended to help you understand your ongoing costs (in dollars) of investing in a Portfolio 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 six-month period ended June 30, 2020.

Actual Expenses

The first section in the following table provides information about actual investment values and actual expenses for each share class. You may use the information in this section, together with your initial investment in Portfolio shares, to estimate the expenses that you paid over the period. Simply divide the value of that investment by $1,000 (for example, a $7,500 initial investment divided by $1,000 = 7.5), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your investment during this period. In addition, there are fees and expenses imposed under the variable annuity or variable life insurance contract through which shares of the Portfolio are held. Additional fees have the effect of reducing investment returns.

Hypothetical Example for Comparison Purposes

The second section in the following table provides information about hypothetical investment values and hypothetical expenses for each share class based on the Portfolio’s actual expense ratio and an assumed rate of return of five percent per year before expenses, which is not the Portfolio’s actual return. The hypothetical investment values and expenses may not be used to estimate the actual investment value at the end of the period or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Portfolio and other funds. To do so, compare this five percent hypothetical example with the five percent 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 as a shareholder of the Portfolio and do not reflect any fees and expenses imposed under the variable annuity or variable life insurance contract through which shares of the Portfolio are held.

Expenses paid may be impacted by expense reduction arrangements. If those arrangements had not been in place, expenses paid would have been higher. See Note 5 in Notes to Financial Statements for further information.

	Actual(1)						Hypothetical(2)
Portfolio	Beginning Account Value 12-31-19		Ending Account Value 6-30-20		Expenses Paid During Period*		Beginning Account Value 12-31-19		Ending Account Value 6-30-20		Expenses Paid During Period*		Annualized Expense Ratio Based on the Six-Month Period
Core Equity
Class II	$	1,000	$	987.60	$	4.67	$	1,000	$	1,020.12	$	4.75		0.95%
Corporate Bond
Class II	$	1,000	$	1,064.30	$	4.03	$	1,000	$	1,020.98	$	3.94		0.78%
Global Bond
Class II	$	1,000	$	1,016.80	$	3.93	$	1,000	$	1,020.97	$	3.94		0.78%
Global Equity Income
Class II	$	1,000	$	863.70	$	4.85	$	1,000	$	1,019.69	$	5.25		1.04%
Global Growth
Class II	$	1,000	$	972.30	$	5.52	$	1,000	$	1,019.25	$	5.65		1.13%
Limited-Term Bond
Class II	$	1,000	$	1,029.90	$	4.16	$	1,000	$	1,020.81	$	4.14		0.82%
Securian Real Estate Securities
Class II	$	1,000	$	867.40	$	6.72	$	1,000	$	1,017.69	$	7.26		1.44%
Value
Class II	$	1,000	$	825.60	$	4.56	$	1,000	$	1,019.85	$	5.05		1.01%

4 SEMIANNUAL REPORT 2020

ILLUSTRATION OF PORTFOLIO EXPENSES IVY VIP

(UNAUDITED)

* Portfolio expenses are equal to the Portfolio’s annualized expense ratio (provided in the table), multiplied by the average account value over the period, multiplied by 182 days in the six-month period ended June 30, 2020, and divided by 366.

(1) This section uses the Portfolio’s actual total return and actual Portfolio expenses. It is a guide to the actual expenses paid by the Portfolio in the period. The “Ending Account Value” shown is computed using the Portfolio’s actual return and the “Expenses Paid During Period” column shows the dollar amount that would have been paid by an investor who started with $1,000 in the Portfolio. A shareholder may use the information here, together with the dollar amount invested, to estimate the expenses that were paid over the period. For every thousand dollars a shareholder has invested, the expenses are listed in the last column of this section.

(2) This section uses a hypothetical five percent annual return and actual Portfolio expenses. It helps to compare the Portfolio’s ongoing costs with other mutual funds. A shareholder can compare the Portfolio’s ongoing costs by comparing this hypothetical example with the hypothetical examples that appear in shareholder reports of other Portfolios.

The above illustrations are based on ongoing costs only.

2020 SEMIANNUAL REPORT 5

PORTFOLIO HIGHLIGHTS CORE EQUITY

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Stocks	99.8%
Information Technology	27.2%
Financials	16.4%
Health Care	15.1%
Communication Services	10.6%
Consumer Discretionary	9.9%
Industrials	7.3%
Consumer Staples	7.2%
Utilities	2.2%
Materials	1.6%
Energy	1.5%
Real Estate	0.8%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	0.2%

Top 10 Equity Holdings

Company	Sector	Industry
Microsoft Corp.	Information Technology	Systems Software
Apple, Inc.	Information Technology	Technology Hardware, Storage & Peripherals
Amazon.com, Inc.	Consumer Discretionary	Internet & Direct Marketing Retail
Union Pacific Corp.	Industrials	Railroads
MasterCard, Inc., Class A	Information Technology	Data Processing & Outsourced Services
Morgan Stanley	Financials	Investment Banking & Brokerage
Cisco Systems, Inc.	Information Technology	Communications Equipment
Danaher Corp.	Health Care	Health Care Equipment
Aon plc	Financials	Insurance Brokers
Citigroup, Inc.	Financials	Other Diversified Financial Services

See your advisor or www.ivyinvestments.com for more information on the Portfolio’s most recently published Top 10 Equity Holdings.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

6 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS CORE EQUITY (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS	Shares		Value
Communication Services
Cable & Satellite – 1.7%
Charter Communications, Inc., Class A (A)		22	$	10,981
Integrated Telecommunication Services – 2.1%
Verizon Communications, Inc.		250		13,804
Interactive Home Entertainment – 1.3%
Take-Two Interactive Software, Inc. (A)		64		8,869
Interactive Media & Services – 3.7%
Alphabet, Inc., Class A (A)		10		13,616
Facebook, Inc., Class A (A)		48		10,812
				24,428
Movies & Entertainment – 1.8%
Netflix, Inc. (A)		27		12,063
Total Communication Services – 10.6%				70,145
Consumer Discretionary
Auto Parts & Equipment – 1.6%
Aptiv plc		136		10,560
Automotive Retail – 2.2%
AutoZone, Inc. (A)		13		14,524
Footwear – 1.5%
NIKE, Inc., Class B		102		9,987
Internet & Direct Marketing Retail – 4.6%
Amazon.com, Inc. (A)		11		29,986
Total Consumer Discretionary – 9.9%				65,057
Consumer Staples
Food Distributors – 0.8%
Sysco Corp.		99		5,387
Household Products – 1.5%
Procter & Gamble Co. (The)		83		9,938
Hypermarkets & Super Centers – 4.2%
Costco Wholesale Corp.		41		12,370
Wal-Mart Stores, Inc.		127		15,206
				27,576
Packaged Foods & Meats – 0.7%
General Mills, Inc.		70		4,342
Total Consumer Staples – 7.2%				47,243
Energy
Oil & Gas Refining & Marketing – 1.5%
Phillips 66		137		9,853
Total Energy – 1.5%				9,853

COMMON STOCKS (Continued)	Shares		Value
Financials
Asset Management & Custody Banks – 3.8%
Apollo Global Management LLC		92	$	4,604
Blackstone Group, Inc. (The), Class A		174		9,882
KKR & Co.		335		10,360
				24,846
Consumer Finance – 1.1%
Discover Financial Services		146		7,302
Financial Exchanges & Data – 2.1%
S&P Global, Inc.		41		13,627
Insurance Brokers – 2.4%
Aon plc (A)		82		15,869
Investment Banking & Brokerage – 2.5%
Morgan Stanley		343		16,582
Other Diversified Financial Services – 2.4%
Citigroup, Inc.		309		15,798
Property & Casualty Insurance – 2.1%
Progressive Corp. (The)		173		13,838
Total Financials – 16.4%				107,862
Health Care
Health Care Equipment – 6.0%
Boston Scientific Corp. (A)		220		7,729
Danaher Corp.		91		16,041
Zimmer Holdings, Inc.		132		15,719
				39,489
Health Care Facilities – 1.0%
HCA Holdings, Inc.		68		6,571
Health Care Services – 1.4%
CVS Caremark Corp.		148		9,612
Managed Health Care – 2.3%
UnitedHealth Group, Inc.		51		15,156
Pharmaceuticals – 4.4%
Eli Lilly and Co.		68		11,194
Roche Holdings Ltd. ADR		136		5,884
Zoetis, Inc.		86		11,844
				28,922
Total Health Care – 15.1%				99,750
Industrials
Aerospace & Defense – 2.2%
Lockheed Martin Corp.		40		14,689
Environmental & Facilities Services – 1.3%
Waste Connections, Inc.		89		8,369
Railroads – 2.7%
Union Pacific Corp.		104		17,660

COMMON STOCKS (Continued)	Shares		Value
Trading Companies & Distributors – 1.1%
United Rentals, Inc. (A)		49	$	7,272
Total Industrials – 7.3%				47,990
Information Technology
Communications Equipment – 3.8%
Cisco Systems, Inc.		346		16,138
Motorola Solutions, Inc.		66		9,189
				25,327
Data Processing & Outsourced Services – 6.1%
Fidelity National Information Services, Inc.		105		14,023
Fiserv, Inc. (A)		90		8,781
MasterCard, Inc., Class A		58		17,229
				40,033
Electronic Manufacturing Services – 1.6%
TE Connectivity Ltd.		133		10,813
Semiconductors – 3.2%
Analog Devices, Inc.		99		12,189
Texas Instruments, Inc.		71		8,980
				21,169
Systems Software – 7.8%
Microsoft Corp.		254		51,637
Technology Hardware, Storage & Peripherals – 4.7%
Apple, Inc.		84		30,698
Total Information Technology – 27.2%				179,677
Materials
Specialty Chemicals – 1.6%
Sherwin-Williams Co. (The)		19		10,743
Total Materials – 1.6%				10,743
Real Estate
Health Care REITs – 0.8%
Welltower, Inc.		107		5,518
Total Real Estate – 0.8%				5,518
Utilities
Electric Utilities – 2.2%
NextEra Energy, Inc.		61		14,705
Total Utilities – 2.2%				14,705
TOTAL COMMON STOCKS – 99.8%			$	658,543
(Cost: $566,235)

2020 SEMIANNUAL REPORT 7

SCHEDULE OF INVESTMENTS CORE EQUITY (in thousands)

JUNE 30, 2020 (UNAUDITED)

SHORT-TERM SECURITIES	Shares		Value
Money Market Funds (B) – 0.3%
State Street Institutional U.S. Government Money Market Fund – Premier Class, 0.120%		1,743	$	1,743
TOTAL SHORT-TERM SECURITIES – 0.3%			$	1,743
(Cost: $1,743)
TOTAL INVESTMENT SECURITIES – 100.1%			$	660,286
(Cost: $567,978)
LIABILITIES, NET OF CASH AND OTHER ASSETS – (0.1)%				(895	)
NET ASSETS – 100.0%			$	659,391

Notes to Schedule of Investments

(A) No dividends were paid during the preceding 12 months.

(B) Rate shown is the annualized 7-day yield at June 30, 2020.

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Common Stocks	$	658,543	$	—	$	—
Short-Term Securities		1,743		—		—
Total	$	660,286	$	—	$	—

The following acronyms are used throughout this schedule:

ADR = American Depositary Receipts

REIT = Real Estate Investment Trust

See Accompanying Notes to Financial Statements.

8 SEMIANNUAL REPORT 2020

PORTFOLIO HIGHLIGHTS CORPORATE BOND

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Bonds	96.4%
Corporate Debt Securities	92.9%
Asset-Backed Securities	1.6%
Municipal Bonds – Taxable	1.1%
Other Government Securities	0.5%
United States Government and Government Agency Obligations	0.2%
Mortgage-Backed Securities	0.1%
Cash and Other Assets (Net of Liabilities), and Cash Equivalents+	3.6%

Quality Weightings

Investment Grade	92.8%
AAA	2.4%
AA	7.2%
A	33.9%
BBB	49.3%
Non-Investment Grade	3.6%
BB	3.3%
B	0.2%
Non-rated	0.1%
Cash and Other Assets (Net of Liabilities), and Cash Equivalents+	3.6%

Our preference is to always use ratings obtained from Standard & Poor’s, Moody’s, and Fitch. It is each Portfolio’s general policy to classify such security at the lower rating level if only two ratings are available. If more than two ratings are available and a median exists, the median is used. If more than two ratings exist without a median, the lower of the two middle ratings is used. We do not evaluate these ratings, but simply assign them to the appropriate credit quality category as determined by the rating agency.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

2020 SEMIANNUAL REPORT 9

SCHEDULE OF INVESTMENTS CORPORATE BOND (in thousands)

JUNE 30, 2020 (UNAUDITED)

ASSET-BACKED SECURITIES	Principal		Value
AerCap Ireland Capital Ltd. and AerCap Global Aviation Trust,
3.500%, 5-26-22	$	1,470	$	1,454
Air Canada Enhanced Equipment Trust, Series 2015-2, Class AA,
3.750%, 12-15-27 (A)		807		763
American Airlines Class AA Pass-Through Certificates, Series 2016-2,
3.200%, 6-15-28		1,572		1,481
American Airlines, Inc. Pass-Through Certificates, Series 2016-1, Class AA,
3.575%, 1-15-28		833		806
American Airlines, Inc. Pass-Through Certificates, Series 2017-1, Class AA,
3.650%, 2-15-29		2,131		2,041
Delta Air Lines, Inc. Pass-Through Certificates, Series 2020AA, Class B,
2.000%, 6-10-28		1,525		1,454
United Airlines Pass-Through Certificates, Series 2016-AA,
3.100%, 7-7-28		2,561		2,459
TOTAL ASSET-BACKED SECURITIES – 1.6%			$	10,458
(Cost: $10,795)
CORPORATE DEBT SECURITIES
Communication Services
Advertising – 0.2%
Lamar Media Corp.,
4.875%, 1-15-29 (A)		1,350		1,357
Alternative Carriers – 0.7%
Bell Canada (GTD by BCE, Inc.),
4.300%, 7-29-49		3,554		4,358
Broadcasting – 0.4%
Fox Corp.:
3.500%, 4-8-30		1,075		1,200
5.476%, 1-25-39		250		334
5.576%, 1-25-49		750		1,055
				2,589
Cable & Satellite – 1.4%
Charter Communications Operating LLC and Charter Communications Operating Capital Corp.:
4.464%, 7-23-22		1,800		1,919
3.700%, 4-1-51		650		633
Comcast Corp. (GTD by Comcast Cable Communications and NBCUniversal):
3.900%, 3-1-38		500		593
4.600%, 10-15-38		1,125		1,433
Comcast Corp. (GTD by Comcast Cable Communications LLC and NBCUniversal Media LLC),
3.250%, 11-1-39		3,875		4,299
				8,877

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Integrated Telecommunication Services – 2.5%
AT&T, Inc.:
3.950%, 1-15-25	$	1,000	$	1,118
2.950%, 7-15-26		2,000		2,163
4.350%, 3-1-29		3,500		4,080
Verizon Communications, Inc.:
4.500%, 8-10-33		3,500		4,358
5.250%, 3-16-37		1,250		1,692
4.812%, 3-15-39		1,684		2,200
				15,611
Interactive Home Entertainment – 0.5%
Activision Blizzard, Inc.,
2.300%, 9-15-21		3,145		3,206
Movies & Entertainment – 0.3%
Walt Disney Co. (The),
4.125%, 6-1-44		1,724		2,081
Publishing – 0.5%
Thomson Reuters Corp.:
3.350%, 5-15-26		850		924
5.850%, 4-15-40		1,500		1,864
				2,788
Wireless Telecommunication Service – 0.9%
Crown Castle Towers LLC,
3.663%, 5-15-25 (A)		2,450		2,613
Sprint Spectrum L.P.,
3.360%, 9-20-21 (A)		1,094		1,107
T-Mobile USA, Inc.,
3.875%, 4-15-30 (A)		1,750		1,951
				5,671
Total Communication Services – 7.4%				46,538
Consumer Discretionary
Apparel Retail – 0.3%
Ross Stores, Inc.,
5.450%, 4-15-50		1,425		1,854
Apparel, Accessories & Luxury Goods – 0.3%
Ralph Lauren Corp.,
2.950%, 6-15-30		2,025		2,090
Automotive Retail – 0.3%
AutoNation, Inc.,
4.750%, 6-1-30		1,700		1,842
Casinos & Gaming – 0.4%
GLP Capital L.P. and GLP Financing II, Inc.:
5.375%, 4-15-26		425		465
4.000%, 1-15-30		640		636
Las Vegas Sands Corp.,
3.500%, 8-18-26		1,595		1,590
				2,691
Education Services – 0.1%
University of Southern California,
3.028%, 10-1-39		500		544

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Footwear – 0.9%
NIKE, Inc.:
3.250%, 3-27-40	$	2,500	$	2,817
3.375%, 3-27-50		2,575		2,952
				5,769
General Merchandise Stores – 0.7%
Target Corp.,
2.650%, 9-15-30		4,000		4,394
Home Improvement Retail – 0.3%
Home Depot, Inc. (The),
4.200%, 4-1-43		1,670		2,066
Homebuilding – 0.4%
NVR, Inc.,
3.000%, 5-15-30		2,302		2,406
Hotels, Resorts & Cruise Lines – 0.7%
Carnival Corp.,
11.500%, 4-1-23 (A)		320		345
Royal Caribbean Cruises Ltd.:
2.650%, 11-28-20 (B)		1,875		1,819
3.700%, 3-15-28		3,500		2,204
				4,368
Internet & Direct Marketing Retail – 0.9%
Amazon.com, Inc.,
2.500%, 6-3-50		2,900		2,933
Booking Holdings, Inc.,
4.625%, 4-13-30		1,130		1,322
Expedia Group, Inc.:
6.250%, 5-1-25 (A)		1,090		1,164
7.000%, 5-1-25 (A)		117		121
				5,540
Leisure Facilities – 0.2%
Cedar Fair Entertainment Co., Magnum Management Corp., Canada’s Wonderland Co. and Millennium Operations LLC,
5.500%, 5-1-25 (A)		1,050		1,055
Restaurants – 0.2%
Darden Restaurants, Inc.,
4.550%, 2-15-48		1,300		1,237
Total Consumer Discretionary – 5.7%				35,856
Consumer Staples
Agricultural Products – 0.2%
Cargill, Inc.,
2.125%, 4-23-30 (A)		1,000		1,048
Brewers – 0.9%
Anheuser-Busch InBev Worldwide, Inc. (GTD by AB INBEV/BBR/COB):
4.750%, 1-23-29		1,713		2,070
5.550%, 1-23-49		2,550		3,413
				5,483

10 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS CORPORATE BOND (in thousands)

JUNE 30, 2020 (UNAUDITED)

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Drug Retail – 0.4%
CVS Health Corp.:
2.800%, 7-20-20	$	75	$	75
5.050%, 3-25-48		1,800		2,341
				2,416
Food Distributors – 0.4%
Sysco Corp.:
6.600%, 4-1-40		665		900
6.600%, 4-1-50		1,065		1,463
U.S. Foods, Inc.,
6.250%, 4-15-25 (A)		335		341
				2,704
Food Retail – 0.2%
Alimentation Couche-Tard, Inc.,
2.950%, 1-25-30 (A)		1,600		1,659
Hypermarkets & Super Centers – 0.5%
Walmart, Inc.,
4.050%, 6-29-48		2,275		2,983
Packaged Foods & Meats – 1.8%
Hormel Foods Corp.,
1.800%, 6-11-30		3,500		3,562
Mars, Inc.,
3.950%, 4-1-49 (A)		2,500		3,152
Nestle Holdings, Inc.:
3.900%, 9-24-38 (A)		980		1,217
4.000%, 9-24-48 (A)		400		515
Smithfield Foods, Inc.:
2.650%, 10-3-21 (A)		1,250		1,236
3.350%, 2-1-22 (A)		1,500		1,489
				11,171
Personal Products – 0.4%
Estee Lauder Co., Inc. (The),
4.150%, 3-15-47		1,875		2,367
Soft Drinks – 0.4%
PepsiCo, Inc.:
3.375%, 7-29-49		1,200		1,376
3.625%, 3-19-50		1,275		1,550
				2,926
Tobacco – 1.5%
Altria Group, Inc. (GTD by Philip Morris USA, Inc.):
3.490%, 2-14-22		1,830		1,909
2.850%, 8-9-22		2,550		2,657
Imperial Brands Finance plc,
3.125%, 7-26-24 (A)		2,700		2,804
Philip Morris International, Inc.:
2.875%, 5-1-24		585		628
2.100%, 5-1-30		1,225		1,262
				9,260
Total Consumer Staples – 6.7%				42,017

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Energy
Integrated Oil & Gas – 0.3%
National Fuel Gas Co.,
5.500%, 1-15-26	$	1,875	$	1,994
Oil & Gas Equipment & Services – 0.5%
Baker Hughes, a GE Co. LLC and Baker Hughes Co-Obligor, Inc.,
2.773%, 12-15-22		3,000		3,131
Oil & Gas Exploration & Production – 1.9%
BP Capital Markets plc (GTD by BP plc):
3.216%, 11-28-23		1,000		1,075
3.814%, 2-10-24		3,000		3,300
Canadian Natural Resources Ltd.,
3.850%, 6-1-27		4,950		5,289
ConocoPhillips Co. (GTD by ConocoPhillips),
4.150%, 11-15-34		218		242
EQT Corp.:
3.000%, 10-1-22		1,450		1,348
6.125%, 2-1-25		650		648
				11,902
Oil & Gas Refining & Marketing – 0.4%
Phillips 66 (GTD by Phillips 66 Co.) (3-Month U.S. LIBOR plus 60 bps),
0.960%, 2-26-21 (C)		2,000		1,997
Oil & Gas Storage & Transportation – 5.6%
Boardwalk Pipelines L.P. (GTD by Boardwalk Pipeline Partners L.P.),
4.450%, 7-15-27		2,000		2,101
Cheniere Corpus Christi Holdings LLC,
7.000%, 6-30-24		1,075		1,223
Colonial Pipeline Co.,
4.250%, 4-15-48 (A)		1,000		1,134
Colorado Interstate Gas Co.,
4.150%, 8-15-26 (A)		1,000		1,113
Energy Transfer Partners L.P.:
4.200%, 4-15-27		1,000		1,046
6.000%, 6-15-48		1,000		1,037
EQT Midstream Partners L.P.,
4.750%, 7-15-23		1,000		1,009
Kinder Morgan, Inc.,
5.550%, 6-1-45		1,000		1,214
Midwest Connector Capital Co. LLC,
3.900%, 4-1-24 (A)		2,435		2,558
Plains All American Pipeline L.P. and PAA Finance Corp.:
3.600%, 11-1-24		1,031		1,053
4.500%, 12-15-26		1,750		1,854
Sabal Trail Transmission LLC,
4.246%, 5-1-28 (A)		2,500		2,791
Sabine Pass Liquefaction LLC,
4.200%, 3-15-28		2,150		2,306
Sunoco Logistics Partners Operations L.P. (GTD by Energy Transfer Partners L.P.),
4.000%, 10-1-27		2,000		2,049

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Oil & Gas Storage & Transportation (Continued)
Sunoco Logistics Partners Operations L.P. (GTD by Sunoco Logistics Partners L.P.),
4.400%, 4-1-21	$	500	$	510
Tennessee Gas Pipeline Co.,
7.000%, 3-15-27		2,000		2,439
TransCanada Corp.,
5.100%, 3-15-49		3,000		3,826
Transcontinental Gas Pipe Line Co. LLC:
3.250%, 5-15-30 (A)		1,225		1,308
4.600%, 3-15-48		1,000		1,137
Williams Partners L.P.,
4.850%, 3-1-48		3,250		3,554
				35,262
Total Energy – 8.7%				54,286
Financials
Asset Management & Custody Banks – 3.0%
Apollo Management Holdings L.P.,
2.650%, 6-5-30 (A)		3,865		3,844
Blackstone Holdings Finance Co. LLC:
2.500%, 1-10-30 (A)		1,475		1,538
3.500%, 9-10-49 (A)		908		939
Brookfield Finance, Inc. (GTD by Brookfield Asset Management, Inc.),
4.350%, 4-15-30		3,000		3,385
KKR Group Finance Co. III LLC,
5.125%, 6-1-44 (A)		1,885		2,266
National Securities Clearing Corp.,
1.500%, 4-23-25 (A)		5,000		5,114
Owl Rock Capital Corp.:
5.250%, 4-15-24		675		706
4.000%, 3-30-25		1,025		1,012
				18,804
Consumer Finance – 0.5%
Ford Motor Credit Co. LLC:
5.875%, 8-2-21		1,500		1,515
3.810%, 1-9-24		1,500		1,440
General Motors Financial Co., Inc. (GTD by AmeriCredit Financial Services, Inc.),
3.200%, 7-6-21		500		506
				3,461
Diversified Banks – 7.9%
Banco Santander S.A.,
3.500%, 4-11-22		1,250		1,300
Bank of America Corp.:
2.503%, 10-21-22		4,000		4,095
5.875%, 9-15-66		2,000		2,043
Bank of America Corp. (3-Month U.S. LIBOR plus 77 bps),
1.311%, 2-5-26 (C)		4,000		3,947
Bank of New York Mellon Corp. (The),
3.550%, 9-23-21		1,250		1,295

2020 SEMIANNUAL REPORT 11

SCHEDULE OF INVESTMENTS CORPORATE BOND (in thousands)

JUNE 30, 2020 (UNAUDITED)

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Diversified Banks (Continued)
BB&T Corp.,
2.750%, 4-1-22	$	3,500	$	3,629
Citizens Bank N.A.,
3.250%, 2-14-22		1,050		1,087
Commonwealth Bank of Australia,
2.000%, 9-6-21 (A)		1,500		1,528
Danske Bank A.S.,
2.700%, 3-2-22 (A)		1,300		1,342
Fifth Third Bank N.A.:
2.250%, 6-14-21		500		508
3.350%, 7-26-21		1,500		1,541
ING Groep N.V.,
3.550%, 4-9-24		1,325		1,442
Korea Development Bank,
3.000%, 3-19-22		1,125		1,163
Mitsubishi UFJ Financial Group, Inc.:
2.998%, 2-22-22		500		518
3.218%, 3-7-22		2,000		2,085
Mizuho Financial Group, Inc.,
2.953%, 2-28-22		3,000		3,111
Santander Holdings USA, Inc.,
3.400%, 1-18-23		1,000		1,041
Toronto-Dominion Bank,
3.250%, 3-11-24		1,275		1,389
Truist Financial Corp.,
3.875%, 3-19-29		2,455		2,784
U.S. Bancorp,
3.375%, 2-5-24		704		769
U.S. Bank N.A.,
3.450%, 11-16-21		3,500		3,638
Wells Fargo & Co.:
2.100%, 7-26-21		1,000		1,018
3.069%, 1-24-23		1,500		1,554
4.300%, 7-22-27		2,580		2,959
4.150%, 1-24-29		1,000		1,173
4.478%, 4-4-31		1,275		1,544
Westpac Banking Corp.,
2.000%, 8-19-21		1,000		1,018
				49,521
Diversified Capital Markets – 0.3%
Credit Suisse Group AG,
3.574%, 1-9-23 (A)		2,000		2,075
Financial Exchanges & Data – 0.3%
S&P Global, Inc.,
3.250%, 12-1-49		2,000		2,198
Insurance Brokers – 1.4%
Brown & Brown, Inc.,
4.200%, 9-15-24		2,554		2,769
Marsh & McLennan Cos., Inc.:
3.500%, 12-29-20		1,000		1,015
2.750%, 1-30-22		2,000		2,065
Willis North America, Inc.,
2.950%, 9-15-29		2,500		2,649
				8,498
Investment Banking & Brokerage – 3.5%
Credit Suisse Group Funding (Guernsey) Ltd.,
3.125%, 12-10-20		1,000		1,011

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Investment Banking & Brokerage (Continued)
Daiwa Securities Group, Inc.,
3.129%, 4-19-22 (A)	$	1,000	$	1,030
Goldman Sachs Group, Inc. (The):
3.000%, 4-26-22		1,000		1,019
2.905%, 7-24-23		1,000		1,039
4.250%, 10-21-25		3,250		3,663
3.500%, 11-16-26		2,000		2,200
4.017%, 10-31-38		1,500		1,752
Morgan Stanley:
5.000%, 11-24-25		2,150		2,512
3.875%, 1-27-26		3,850		4,355
2.699%, 1-22-31		1,500		1,593
Morgan Stanley (3-Month U.S. LIBOR plus 140 bps),
2.420%, 10-24-23 (C)		1,500		1,516
				21,690
Life & Health Insurance – 3.3%
Aflac, Inc.,
4.750%, 1-15-49		2,250		2,897
MetLife Global Funding I,
1.950%, 9-15-21 (A)		2,000		2,033
Metropolitan Life Insurance Co.,
3.450%, 10-9-21 (A)		3,000		3,108
New York Life Global Funding,
2.900%, 1-17-24 (A)		5,500		5,899
Northwestern Mutual Life Insurance Co. (The),
3.850%, 9-30-47 (A)		3,000		3,429
Principal Life Global Funding II,
3.000%, 4-18-26 (A)		1,000		1,103
Protective Life Global Funding,
2.700%, 11-25-20 (A)		1,000		1,009
Sumitomo Life Insurance Co.,
4.000%, 9-14-77 (A)		1,000		1,070
				20,548
Multi-Line Insurance – 0.3%
Aon Corp. (GTD by Aon plc),
3.750%, 5-2-29		1,608		1,841
Other Diversified Financial Services – 4.0%
Citigroup, Inc.:
3.500%, 5-15-23		2,000		2,135
3.875%, 3-26-25		2,000		2,178
3.520%, 10-27-28		1,750		1,928
2.666%, 1-29-31		1,925		1,998
4.412%, 3-31-31		1,300		1,538
4.700%, 7-30-68		850		754
5.000%, 3-12-69		2,500		2,353
JPMorgan Chase & Co.:
3.220%, 3-1-25		6,000		6,457
4.493%, 3-24-31		3,000		3,665
4.000%, 10-1-68		1,650		1,444
5.000%, 2-1-69		1,000		962
				25,412
Regional Banks – 1.3%
PNC Bank N.A.:
2.450%, 11-5-20		264		265
3.300%, 10-30-24		1,000		1,101

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Regional Banks (Continued)
PNC Financial Services Group, Inc. (The):
2.600%, 7-23-26	$	1,875	$	2,034
3.450%, 4-23-29		2,000		2,307
SunTrust Banks, Inc.,
3.200%, 4-1-24		2,500		2,711
				8,418
Reinsurance – 0.3%
Reinsurance Group of America, Inc.,
3.900%, 5-15-29		1,700		1,852
Specialized Finance – 1.0%
Air Lease Corp.,
3.000%, 2-1-30		1,075		996
Diamond 1 Finance Corp. and Diamond 2 Finance Corp.,
4.420%, 6-15-21 (A)		3,000		3,084
Fidelity National Financial, Inc.,
3.400%, 6-15-30		1,850		1,925
				6,005
Total Financials – 27.1%				170,323
Health Care
Biotechnology – 1.0%
Amgen, Inc.:
3.875%, 11-15-21		2,071		2,149
4.950%, 10-1-41		1,500		1,939
Biogen, Inc.,
3.150%, 5-1-50		2,080		2,003
				6,091
Health Care Distributors – 0.4%
McKesson Corp.,
3.650%, 11-30-20		2,500		2,532
Health Care Equipment – 1.2%
Becton Dickinson & Co.,
2.894%, 6-6-22		3,000		3,104
Boston Scientific Corp.,
4.550%, 3-1-39		1,875		2,303
Zimmer Biomet Holdings, Inc.:
3.550%, 3-20-30		750		809
5.750%, 11-30-39		725		925
				7,141
Health Care Services – 0.4%
Cigna Corp.,
3.400%, 9-17-21		2,500		2,585
Health Care Supplies – 1.0%
Abbott Laboratories,
4.750%, 11-30-36		1,900		2,556
Dentsply Sirona, Inc.,
3.250%, 6-1-30		2,523		2,643
Shire Acquisitions Investments Ireland Designated Activity Co.,
2.400%, 9-23-21		1,000		1,020
				6,219

12 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS CORPORATE BOND (in thousands)

JUNE 30, 2020 (UNAUDITED)

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Life Sciences Tools & Services – 0.5%
PerkinElmer, Inc.,
3.300%, 9-15-29	$	1,700	$	1,822
Thermo Fisher Scientific, Inc.,
4.497%, 3-25-30		1,225		1,515
				3,337
Managed Health Care – 1.5%
Humana, Inc.,
2.900%, 12-15-22		5,000		5,228
UnitedHealth Group, Inc.:
3.500%, 2-15-24		2,500		2,751
2.000%, 5-15-30		425		445
3.700%, 8-15-49		1,000		1,182
				9,606
Pharmaceuticals – 2.2%
Bayer U.S. Finance LLC,
3.000%, 10-8-21 (A)		1,500		1,540
Elanco Animal Health, Inc.:
3.912%, 8-27-21		1,250		1,275
5.022%, 8-28-23 (D)		1,500		1,575
Merck & Co., Inc.,
2.450%, 6-24-50		1,250		1,254
Novartis Capital Corp. (GTD by Novartis AG),
2.750%, 8-14-50		3,250		3,432
Perrigo Finance Unlimited Co. (GTD by Perrigo Co. plc),
3.500%, 3-15-21		1,000		1,001
Pfizer, Inc.,
3.900%, 3-15-39		500		617
Zoetis, Inc.,
4.700%, 2-1-43		2,500		3,302
				13,996
Total Health Care – 8.2%				51,507
Industrials
Aerospace & Defense – 2.0%
BAE Systems Holdings, Inc.,
3.850%, 12-15-25 (A)		1,500		1,660
Boeing Co. (The):
1.650%, 10-30-20 (B)		500		501
2.950%, 2-1-30		2,000		1,953
3.750%, 2-1-50		3,375		3,047
L3Harris Technologies, Inc.,
4.400%, 6-15-28		1,250		1,478
Raytheon Technologies Corp.:
2.250%, 7-1-30		1,050		1,095
3.125%, 7-1-50		625		667
Rockwell Collins, Inc.,
2.800%, 3-15-22 (A)		1,500		1,547
Spirit AeroSystems, Inc. (GTD by Spirit AeroSystems Holdings, Inc.),
4.600%, 6-15-28		720		578
				12,526

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Agricultural & Farm Machinery – 0.2%
CNH Industrial Capital LLC (GTD by CNH Industrial Capital America LLC and New Holland Credit Co. LLC),
1.950%, 7-2-23	$	1,050	$	1,057
Airlines – 0.8%
Aviation Capital Group Corp.,
2.875%, 1-20-22 (A)		3,000		2,867
Southwest Airlines Co.,
5.250%, 5-4-25		815		860
Sydney Airport Finance,
3.625%, 4-28-26 (A)		1,000		1,048
				4,775
Building Products – 0.3%
Allegion plc,
3.500%, 10-1-29		1,700		1,782
Masco Corp.,
4.500%, 5-15-47		250		262
				2,044
Construction Machinery & Heavy Trucks – 0.3%
Oshkosh Corp.,
3.100%, 3-1-30		1,800		1,812
Diversified Support Services – 0.3%
Genpact Luxembourg S.a.r.l. (GTD by Genpact Ltd.),
3.375%, 12-1-24		1,500		1,548
Environmental & Facilities Services – 1.2%
Republic Services, Inc.,
3.050%, 3-1-50		3,000		3,063
Waste Connections, Inc.,
3.500%, 5-1-29		1,549		1,739
Waste Management, Inc. (GTD by Waste Management Holdings, Inc.),
4.100%, 3-1-45		2,500		2,989
				7,791
Industrial Conglomerates – 0.5%
Carlisle Cos., Inc.,
2.750%, 3-1-30		1,800		1,852
Honeywell International, Inc.,
1.950%, 6-1-30		1,050		1,097
				2,949
Industrial Machinery – 0.6%
IDEX Corp.,
3.000%, 5-1-30		1,670		1,743
Roper Technologies, Inc.,
2.950%, 9-15-29		2,000		2,184
				3,927
Railroads – 1.0%
Burlington Northern Santa Fe LLC,
4.550%, 9-1-44		1,000		1,314
Kansas City Southern,
4.300%, 5-15-43		1,475		1,752

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Railroads (Continued)
Union Pacific Corp.:
3.550%, 8-15-39	$	1,875	$	2,103
3.250%, 2-5-50		1,200		1,312
				6,481
Research & Consulting Services – 1.0%
CoStar Group, Inc.,
2.800%, 7-15-30 (A)		1,250		1,279
RELX Capital, Inc. (GTD by RELX plc),
4.000%, 3-18-29		2,375		2,757
Verisk Analytics, Inc.,
4.125%, 3-15-29		2,050		2,395
				6,431
Total Industrials – 8.2%				51,341
Information Technology
Application Software – 1.5%
Adobe, Inc.,
2.300%, 2-1-30		3,000		3,239
Autodesk, Inc.,
2.850%, 1-15-30		1,100		1,211
Infor, Inc.,
1.750%, 7-15-25 (A)		3,270		3,284
Intuit, Inc.:
1.350%, 7-15-27		415		417
1.650%, 7-15-30		1,040		1,036
NXP Semiconductors N.V., NXP B.V. and NXP Funding LLC,
4.300%, 6-18-29 (A)		274		311
				9,498
Communications Equipment – 0.5%
Motorola Solutions, Inc.,
4.600%, 5-23-29		2,825		3,261
Data Processing & Outsourced Services – 1.0%
PayPal Holdings, Inc.:
2.650%, 10-1-26		2,750		2,988
2.300%, 6-1-30		3,000		3,118
				6,106
Electronic Components – 0.4%
Amphenol Corp.,
2.050%, 3-1-25		695		725
Maxim Integrated Products, Inc.,
3.450%, 6-15-27		1,700		1,856
				2,581
IT Consulting & Other Services – 0.1%
Leidos, Inc. (GTD by Leidos Holdings, Inc.),
4.375%, 5-15-30 (A)		525		591
Semiconductor Equipment – 0.5%
Applied Materials, Inc.,
2.750%, 6-1-50		1,225		1,249
Lam Research Corp.:
3.750%, 3-15-26		1,275		1,457
2.875%, 6-15-50		415		429
				3,135

2020 SEMIANNUAL REPORT 13

SCHEDULE OF INVESTMENTS CORPORATE BOND (in thousands)

JUNE 30, 2020 (UNAUDITED)

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Semiconductors – 3.7%
Broadcom, Inc.:
3.459%, 9-15-26 (A)	$	906	$	973
5.000%, 4-15-30 (A)		2,000		2,298
Intel Corp.:
4.000%, 12-15-32		1,500		1,855
4.100%, 5-19-46		4,000		5,040
Microchip Technology, Inc.,
3.922%, 6-1-21		2,750		2,803
QUALCOMM, Inc.:
4.800%, 5-20-45		500		654
4.300%, 5-20-47		1,500		1,870
Texas Instruments, Inc.,
3.875%, 3-15-39		3,500		4,338
Xilinx, Inc.,
2.375%, 6-1-30		3,125		3,216
				23,047
Systems Software – 0.9%
Microsoft Corp.,
3.450%, 8-8-36		4,500		5,426
Technology Hardware, Storage & Peripherals – 1.3%
Apple, Inc.:
2.400%, 5-3-23		2,895		3,060
4.500%, 2-23-36		2,500		3,297
NetApp, Inc.,
3.375%, 6-15-21		1,038		1,061
Seagate HDD Cayman (GTD by Seagate Technology plc),
5.750%, 12-1-34		875		964
				8,382
Total Information Technology – 9.9%				62,027
Materials
Construction Materials – 0.2%
Martin Marietta Materials, Inc.,
2.500%, 3-15-30		1,250		1,259
Diversified Metals & Mining – 0.2%
Anglo American Capital plc,
3.750%, 4-10-22 (A)		1,500		1,543
Fertilizers & Agricultural Chemicals – 0.3%
Nutrien Ltd.,
5.250%, 1-15-45		1,320		1,631
Metal & Glass Containers – 0.2%
Colonial Enterprises, Inc.,
3.250%, 5-15-30 (A)		1,025		1,111
Paper Packaging – 0.1%
International Paper Co.,
4.400%, 8-15-47		750		877
Specialty Chemicals – 0.6%
Ecolab, Inc.,
4.800%, 3-24-30		850		1,078

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Specialty Chemicals (Continued)
Methanex Corp.,
5.250%, 3-1-22	$	2,404	$	2,365
				3,443
Total Materials – 1.6%				9,864
Real Estate
Health Care REITs – 0.2%
Healthpeak Properties, Inc.,
2.875%, 1-15-31		1,025		1,052
Industrial REITs – 0.1%
Aircastle Ltd.,
5.500%, 2-15-22		598		604
Specialized REITs – 3.0%
American Tower Corp.:
3.070%, 3-15-23 (A)		1,500		1,535
3.000%, 6-15-23		2,500		2,666
4.400%, 2-15-26		1,000		1,155
American Tower Trust I,
3.652%, 3-23-28 (A)		1,000		1,080
Crown Castle International Corp.:
2.250%, 9-1-21		500		504
5.250%, 1-15-23		1,027		1,143
3.200%, 9-1-24		1,250		1,356
4.000%, 3-1-27		2,000		2,273
CubeSmart L.P. (GTD by CubeSmart),
4.375%, 2-15-29		1,615		1,877
Public Storage, Inc.,
3.385%, 5-1-29		1,500		1,732
Ventas Realty L.P. (GTD by Ventas, Inc.):
2.650%, 1-15-25		1,875		1,880
4.875%, 4-15-49		1,500		1,640
				18,841
Total Real Estate – 3.3%				20,497
Utilities
Electric Utilities – 3.3%
Appalachian Power Co.,
4.500%, 3-1-49		1,500		1,860
CenterPoint Energy, Inc.:
4.250%, 11-1-28		1,683		1,956
2.950%, 3-1-30		750		797
Commonwealth Edison Co.,
3.650%, 6-15-46		3,000		3,513
Duke Energy Indiana LLC,
3.750%, 5-15-46		1,000		1,161
Entergy Corp.,
2.800%, 6-15-30		1,225		1,290
National Rural Utilities Cooperative Finance Corp.,
4.400%, 11-1-48		2,000		2,586
Southern California Edison Co.,
4.125%, 3-1-48		1,525		1,781
Southern Co. (The),
4.400%, 7-1-46		1,875		2,220

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Electric Utilities (Continued)
Virginia Electric and Power Co., Series B,
4.600%, 12-1-48	$	1,500	$	1,975
Wisconsin Electric Power Co.:
4.250%, 6-1-44		250		288
4.300%, 10-15-48		1,250		1,538
				20,965
Gas Utilities – 0.3%
Southern California Gas Co.,
4.300%, 1-15-49		1,500		1,907
Independent Power Producers & Energy Traders – 0.4%
Black Hills Corp.,
4.350%, 5-1-33		2,000		2,275
Multi-Utilities – 1.6%
Ameren Corp.,
3.500%, 1-15-31		850		950
Baltimore Gas and Electric Co.,
4.250%, 9-15-48		1,500		1,872
Dominion Energy, Inc.,
3.600%, 3-15-27		2,000		2,212
Dominion Resources, Inc.,
2.750%, 1-15-22		3,000		3,073
Public Service Electric and Gas Co.,
1.900%, 3-15-21		2,000		2,019
				10,126
Water Utilities – 0.5%
American Water Capital Corp.,
4.150%, 6-1-49		2,500		3,097
Total Utilities – 6.1%				38,370
TOTAL CORPORATE DEBT SECURITIES – 92.9%			$	582,626
(Cost: $544,887)
MORTGAGE-BACKED SECURITIES
Non-Agency REMIC/CMO – 0.1%
MASTR Adjustable Rate Mortgages Trust, Series 2005-1, Class B1 (Mortgage spread to 10-year U.S. Treasury index),
3.760%, 3-25-35 (C)		909		708
TOTAL MORTGAGE-BACKED SECURITIES – 0.1%			$	708
(Cost: $905)
MUNICIPAL BONDS – TAXABLE
New York – 0.6%
NYC Indl Dev Agy, Rental Rev Bonds (Yankee Stadium Proj), Ser 2009,
11.000%, 3-1-29 (A)		2,805		3,832

14 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS CORPORATE BOND (in thousands)

JUNE 30, 2020 (UNAUDITED)

MUNICIPAL BONDS – TAXABLE (Continued)	Principal		Value
Ohio – 0.4%
OH State Univ, Gen Receipts Bonds (Multiyear Debt Issuance Prog), Ser 2016A,
3.798%, 12-1-46	$	2,000	$	2,520
Pennsylvania – 0.1%
Cmnwlth of PA, GO Bonds, Third Ser B of 2010 (Federally Taxable – Build America Bonds),
4.750%, 7-15-22		750		751
TOTAL MUNICIPAL BONDS – TAXABLE – 1.1%			$	7,103
(Cost: $5,556)
OTHER GOVERNMENT SECURITIES (E)
Canada – 0.5%
Province de Quebec,
7.140%, 2-27-26		2,500		3,289
TOTAL OTHER GOVERNMENT SECURITIES – 0.5%			$	3,289
(Cost: $2,682)
UNITED STATES GOVERNMENT AGENCY OBLIGATIONS
Agency Obligations – 0.2%
Tennessee Valley Authority,
2.875%, 2-1-27		1,000		1,133

UNITED STATES GOVERNMENT AGENCY OBLIGATIONS (Continued)	Principal		Value
Mortgage-Backed Obligations – 0.0%
Government National Mortgage Association Agency REMIC/CMO,
0.004%, 6-17-45 (A)(F)	$	11	$	—	*
TOTAL UNITED STATES GOVERNMENT AGENCY OBLIGATIONS – 0.2%			$	1,133
(Cost: $1,001)
SHORT-TERM SECURITIES	Shares
Money Market Funds (H) – 3.4%
Dreyfus Institutional Preferred Government Money Market Fund – Institutional Shares,
0.100% (G)		1,671		1,671
State Street Institutional U.S. Government Money Market Fund – Premier Class,
0.120%		19,724		19,724
				21,395
TOTAL SHORT-TERM SECURITIES – 3.4%			$	21,395
(Cost: $21,395)
TOTAL INVESTMENT SECURITIES – 99.8%			$	626,712
(Cost: $587,221)
CASH AND OTHER ASSETS, NET OF LIABILITIES (I) – 0.2%				1,111
NET ASSETS – 100.0%			$	627,823

Notes to Schedule of Investments

* Not shown due to rounding.

(A) Securities were purchased pursuant to an exemption from registration available under Rule 144A under the Securities Act of 1933 and may only be resold in transactions exempt from registration, normally to qualified institutional buyers. At June 30, 2020 the total value of these securities amounted to $99,751 or 15.9% of net assets.

(B) All or a portion of securities with an aggregate value of $1,838 are on loan.

(C) Variable rate security. Interest rate disclosed is that which is in effect at June 30, 2020. Description of the reference rate and spread, if applicable, are included in the security description.

(D) Step bond that pays an initial coupon rate for the first period and then a higher or lower coupon rate for the following periods. Interest rate disclosed is that which is in effect at June 30, 2020.

(E) Other Government Securities may include emerging markets sovereign, quasi-sovereign, corporate and supranational agency and organization debt securities.

(F) Interest-only security. Amount shown as principal represents notional amount for computation of interest.

(G) Investment made with cash collateral received from securities on loan.

(H) Rate shown is the annualized 7-day yield at June 30, 2020.

(I) Cash of $114 has been pledged as collateral on open futures contracts.

The following futures contracts were outstanding at June 30, 2020 (contracts unrounded):

Description	Type		Number of Contracts		Expiration Date		Notional Amount		Value			Unrealized Depreciation
U.S. 10-Year Treasury Note		Short		67		9-30-20		6,700	$	(9,325	)	$	(19	)

2020 SEMIANNUAL REPORT 15

SCHEDULE OF INVESTMENTS CORPORATE BOND (in thousands)

JUNE 30, 2020 (UNAUDITED)

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Asset-Backed Securities	$	—	$	10,458	$	—
Corporate Debt Securities		—		582,626		—
Mortgage-Backed Securities		—		708		—
Municipal Bonds		—		7,103		—
Other Government Securities		—		3,289		—
United States Government Agency Obligations		—		1,133		—
Short-Term Securities		21,395		—		—
Total	$	21,395	$	605,317	$	—
Liabilities
Futures Contracts	$	19	$	—	$	—

The following acronyms are used throughout this schedule:

CMO = Collateralized Mortgage Obligation

GTD = Guaranteed

LIBOR = London Interbank Offered Rate

REIT = Real Estate Investment Trust

REMIC = Real Estate Mortgage Investment Conduit

See Accompanying Notes to Financial Statements.

16 SEMIANNUAL REPORT 2020

PORTFOLIO HIGHLIGHTS GLOBAL BOND

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Bonds	97.4%
Corporate Debt Securities	84.4%
Other Government Securities	8.4%
United States Government and Government Agency Obligations	4.6%
Cash and Other Assets (Net of Liabilities), and Cash Equivalents+	2.6%

Quality Weightings

Investment Grade	67.6%
AAA	3.5%
AA	3.3%
A	21.2%
BBB	39.6%
Non-Investment Grade	29.8%
BB	18.1%
B	8.0%
CCC	2.4%
Below CCC	0.8%
Non-rated	0.5%
Cash and Other Assets (Net of Liabilities), and Cash Equivalents+	2.6%

Our preference is to always use ratings obtained from Standard & Poor’s, Moody’s, and Fitch. It is each Portfolio’s general policy to classify such security at the lower rating level if only two ratings are available. If more than two ratings are available and a median exists, the median is used. If more than two ratings exist without a median, the lower of the two middle ratings is used. We do not evaluate these ratings, but simply assign them to the appropriate credit quality category as determined by the rating agency.

Country Weightings

North America	30.3%
United States	20.9%
Mexico	6.6%
Other North America	2.8%
Europe	23.0%
United Kingdom	7.8%
Netherlands	6.4%
Other Europe	8.8%
South America	19.4%
Brazil	5.7%
Chile	4.6%
Other South America	9.1%
Pacific Basin	17.6%
South Korea	3.5%
Other Pacific Basin	14.1%
Middle East	4.5%
Bahamas/Caribbean	1.6%
Africa	1.0%
Cash and Other Assets (Net of Liabilities), and Cash Equivalents+	2.6%

+ Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

2020 SEMIANNUAL REPORT 17

SCHEDULE OF INVESTMENTS GLOBAL BOND (in thousands)

JUNE 30, 2020 (UNAUDITED)

CORPORATE DEBT SECURITIES	Principal		Value
Argentina
Energy – 0.8%
Pampa Energia S.A.
7.500%, 1-24-27 (A)	$	150	$	121
Pan American Energy LLC
7.875%, 5-7-21		33		33
				154
Total Argentina – 0.8%			$	154
Australia
Utilities – 1.1%
Ausgrid Finance Pty Ltd.
3.850%, 5-1-23 (A)		200		210
Total Australia – 1.1%			$	210
Austria
Consumer Staples – 1.0%
JBS Investments II GmbH (GTD by JBS S.A.)
5.750%, 1-15-28 (A)		200		198
Total Austria – 1.0%			$	198
Bermuda
Consumer Staples – 0.5%
Bacardi Ltd.
4.450%, 5-15-25 (A)		100		109
Total Bermuda – 0.5%			$	109
Brazil
Industrials – 1.0%
Cosan Ltd.
5.500%, 9-20-29 (A)		200		190
Materials – 3.6%
CSN Resources S.A.
7.625%, 2-13-23 (A)		200		186
Fibria Overseas Finance Ltd.
4.000%, 1-14-25		150		155
Nexa Resources S.A.
6.500%, 1-18-28 (A)		200		203
Vale Overseas Ltd.
6.250%, 8-10-26		150		176
				720
Utilities – 1.1%
Aegea Finance S.a.r.l.
5.750%, 10-10-24 (A)		200		203
Total Brazil – 5.7%			$	1,113
Canada
Consumer Staples – 0.3%
Alimentation Couche-Tard, Inc.
2.700%, 7-26-22 (A)		60		62

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Energy – 0.6%
TransCanada PipeLines Ltd.
4.250%, 5-15-28	$	100	$	115
Financials – 0.9%
Brookfield Finance, Inc. (GTD by Brookfield Asset Management, Inc.)
4.350%, 4-15-30		100		113
Royal Bank of Canada
4.650%, 1-27-26		50		58
				171
Materials – 1.0%
First Quantum Minerals Ltd.
6.875%, 3-1-26 (A)		200		189
Total Canada – 2.8%			$	537
Cayman Islands
Financials – 0.8%
Itau Unibanco Holdings S.A.
4.625%, 8-27-68 (A)		200		165
Industrials – 0.3%
LATAM Finance Ltd.
7.000%, 3-1-26 (A)(B)		200		54
Total Cayman Islands – 1.1%			$	219
Chile
Energy – 0.9%
GeoPark Ltd.
6.500%, 9-21-24 (A)		200		184
Financials – 1.0%
Banco del Estado de Chile
2.704%, 1-9-25 (A)		200		206
Industrials – 1.1%
Empresa de Transporte de Pasajeros Metro S.A.
3.650%, 5-7-30 (A)		200		216
Materials – 1.1%
Celulosa Arauco y Constitucion S.A.
4.500%, 8-1-24		200		211
Utilities – 0.5%
Enel Chile S.A.
4.875%, 6-12-28		80		89
Total Chile – 4.6%			$	906
China
Communication Services – 2.1%
Tencent Holdings Ltd.
2.985%, 1-19-23 (A)		200		208

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Communication Services (Continued)
Weibo Corp.
3.500%, 7-5-24	$	200	$	207
				415
Consumer Discretionary – 1.1%
Alibaba Group Holding Ltd.
3.400%, 12-6-27		200		222
Total China – 3.2%			$	637
Columbia
Financials – 1.1%
Banco de Bogota S.A.
5.375%, 2-19-23 (A)		200		207
Utilities – 1.4%
Emgesa S.A. E.S.P.
8.750%, 1-25-21 (C)		COP302,000		82
Empresas Publicas de Medellin E.S.P.
4.250%, 7-18-29 (A)	$	200		200
				282
Total Columbia – 2.5%			$	489
Denmark
Financials – 1.0%
Danske Bank A.S.
2.700%, 3-2-22 (A)		200		206
Total Denmark – 1.0%			$	206
France
Financials – 1.0%
BNP Paribas S.A.
7.625%, 12-29-49 (A)		200		203
Total France – 1.0%			$	203
Hong Kong
Financials – 1.1%
Bangkok Bank Public Co. Ltd.
4.050%, 3-19-24 (A)		200		216
Total Hong Kong – 1.1%			$	216
India
Utilities – 2.0%
Adani Electricity Mumbai Ltd.
3.949%, 2-12-30 (A)		200		186
Adani Green Energy (UP) Ltd., Parampujya Solar Energy Private Ltd. and Prayatna Developers Private Ltd.
6.250%, 12-10-24 (A)		200		209
				395
Total India – 2.0%			$	395

18 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS GLOBAL BOND (in thousands)

JUNE 30, 2020 (UNAUDITED)

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Indonesia
Utilities – 2.3%
Perusahaan Listrik Negara:
5.450%, 5-21-28 (A)	$	200	$	230
5.375%, 1-25-29 (A)		200		231
				461
Total Indonesia – 2.3%			$	461
Isle of Man
Consumer Discretionary – 1.0%
GOHL Capital Ltd.
4.250%, 1-24-27		200		202
Total Isle of Man – 1.0%			$	202
Japan
Financials – 1.8%
Mitsubishi UFJ Financial Group, Inc.
3.287%, 7-25-27		100		110
Sumitomo Mitsui Financial Group, Inc.:
3.748%, 7-19-23		110		119
3.936%, 10-16-23		100		110
				339
Total Japan – 1.8%			$	339
Luxembourg
Consumer Staples – 1.0%
Minerva Luxembourg S.A.
5.875%, 1-19-28 (A)		200		194
Industrials – 1.1%
Rumo Luxembourg S.a.r.l.
7.375%, 2-9-24 (A)		200		210
Total Luxembourg – 2.1%			$	404
Mexico
Consumer Staples – 1.1%
Grupo Bimbo S.A.B. de C.V.
3.875%, 6-27-24 (A)		200		215
Energy – 0.5%
Petroleos Mexicanos
6.490%, 1-23-27 (A)		100		91
Financials – 0.8%
Banco Santander S.A.
4.125%, 11-9-22 (A)		150		156
Industrials – 2.2%
Aerovias de Mexico S.A. de C.V. (GTD by Grupo Aeromexico S.A.B. de C.V.)
7.000%, 2-5-25 (A)(B)		200		46
Alfa S.A.B. de C.V.
5.250%, 3-25-24 (A)		200		213
Grupo Kuo S.A.B. de C.V.
5.750%, 7-7-27 (A)		200		184
				443

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Materials – 1.0%
CEMEX S.A.B. de C.V.
7.750%, 4-16-26 (A)	$	200	$	204
Total Mexico – 5.6%			$	1,109
Netherlands
Communication Services – 1.0%
VTR Finance B.V.
6.875%, 1-15-24 (A)		200		204
Consumer Discretionary – 1.1%
Prosus N.V.
3.680%, 1-21-30 (A)		200		209
Financials – 2.3%
Enel Finance International N.V.
4.625%, 9-14-25 (A)		200		228
Syngenta Finance N.V.
5.182%, 4-24-28 (A)		200		213
				441
Health Care – 1.1%
Teva Pharmaceutical Finance Netherlands III B.V. (GTD by Teva Pharmaceutical Industries Ltd.)
6.750%, 3-1-28 (D)		200		211
Materials – 0.9%
Braskem Netherlands B.V.
4.500%, 1-31-30 (A)		200		183
Total Netherlands – 6.4%			$	1,248
Nigeria
Financials – 1.0%
Africa Finance Corp.
4.375%, 4-17-26 (A)		200		210
Total Nigeria – 1.0%			$	210
Norway
Energy – 1.6%
Aker BP ASA:
6.000%, 7-1-22 (A)		150		153
4.750%, 6-15-24 (A)		150		151
				304
Total Norway – 1.6%			$	304
Peru
Financials – 0.8%
Banco de Credito del Peru
4.250%, 4-1-23 (A)		150		158
Utilities – 0.9%
Fenix Power Peru S.A.
4.317%, 9-20-27		185		182
Total Peru – 1.7%			$	340

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Qatar
Energy – 0.0%
Ras Laffan Liquefied Natural Gas Co. Ltd. II
5.298%, 9-30-20 (A)	$	14	$	14
Total Qatar – 0.0%			$	14
Singapore
Consumer Staples – 0.5%
Olam International Ltd.
7.500%, 8-12-20		100		101
Total Singapore – 0.5%			$	101
South Korea
Financials – 3.5%
Hyundai Capital Services, Inc.
2.983%, 8-29-22 (A)		210		215
Korea Development Bank
3.250%, 2-19-24		200		216
Woori Bank
2.625%, 7-20-21 (A)		250		254
				685
Total South Korea – 3.5%			$	685
Spain
Financials – 1.1%
Banco Santander S.A.
2.706%, 6-27-24		200		210
Total Spain – 1.1%			$	210
United Arab Emirates
Consumer Discretionary – 1.0%
GEMS MENASA Cayman Ltd. and GEMS Education Delaware LLC
7.125%, 7-31-26 (A)		200		190
Energy – 1.1%
Abu Dhabi National Energy Co.
4.375%, 4-23-25 (A)		200		223
Total United Arab Emirates – 2.1%			$	413
United Kingdom
Communication Services – 1.0%
Liquid Telecommunications Financing plc (GTD by Liquid Telecommunications Holdings Ltd.)
8.500%, 7-13-22 (A)		200		197
Consumer Staples – 2.1%
Imperial Tobacco Finance plc
3.750%, 7-21-22 (A)		200		209
MARB BondCo plc
6.875%, 1-19-25 (A)		200		199
				408

2020 SEMIANNUAL REPORT 19

SCHEDULE OF INVESTMENTS GLOBAL BOND (in thousands)

JUNE 30, 2020 (UNAUDITED)

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Financials – 4.7%
ANZ New Zealand International Ltd.
3.450%, 1-21-28 (A)	$	200	$	228
HSBC Holdings plc
4.583%, 6-19-29		300		347
Royal Bank of Scotland Group plc (The)
6.000%, 12-19-23		100		112
State Bank of India
4.875%, 4-17-24 (A)		200		215
				902
Total United Kingdom - 7.8%			$	1,507
United States – 0.0%
Communication Services – 1.2%
T-Mobile USA, Inc.
6.000%, 3-1-23		230		231
Consumer Discretionary – 1.6%
Ross Stores, Inc.
4.800%, 4-15-30		80		96
Volkswagen Group of America, Inc.
4.250%, 11-13-23 (A)		200		219
				315
Consumer Staples – 3.2%
Bunge Ltd. Finance Corp.
3.500%, 11-24-20		250		252
Keurig Dr Pepper, Inc.
4.597%, 5-25-28		125		150
Reynolds American, Inc.
4.450%, 6-12-25		200		225
				627
Financials – 5.7%
Bank of America Corp.
3.593%, 7-21-28		125		140
BBVA Bancomer S.A.
5.875%, 9-13-34 (A)		200		195
Citigroup, Inc.
3.520%, 10-27-28		125		138
Ford Motor Credit Co. LLC
3.096%, 5-4-23		200		189
Goldman Sachs Group, Inc. (The)
3.814%, 4-23-29		100		113
JPMorgan Chase & Co.:
3.540%, 5-1-28		118		131
4.000%, 10-1-68		50		44
TerraForm Global Operating LLC (GTD by TerraForm Global LLC)
6.125%, 3-1-26 (A)		50		49
Wells Fargo & Co.
4.300%, 7-22-27		125		143
				1,142
Health Care – 0.9%
Fresenius U.S. Finance II, Inc.:
4.250%, 2-1-21 (A)		100		102
4.500%, 1-15-23 (A)		75		79
				181

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Industrials – 1.2%
Azul Investments LLP
5.875%, 10-26-24 (A)	$	200	$	93
BAE Systems Holdings, Inc.
3.800%, 10-7-24 (A)		75		82
Boeing Co. (The)
4.508%, 5-1-23		50		53
				228
Information Technology – 0.6%
Broadcom, Inc.
5.000%, 4-15-30 (A)		100		115
Materials – 1.4%
Freeport-McMoRan, Inc.
4.250%, 3-1-30		170		165
Glencore Funding LLC
4.125%, 3-12-24 (A)		100		107
				272
Real Estate – 0.5%
Aircastle Ltd.
4.400%, 9-25-23		100		97
Total United States – 16.3%			$	3,208
Uruguay
Industrials – 0.3%
Navios South American Logistics, Inc. and Navios Logistics Finance (U.S.), Inc.
10.750%, 7-1-25 (A)		70		72
Total Uruguay – 0.3%			$	72
Venezuela
Financials – 0.9%
Corporacion Andina de Fomento:
3.250%, 2-11-22		150		154
2.375%, 5-12-23		30		31
				185
Total Venezuela – 0.9%			$	185
TOTAL CORPORATE DEBT SECURITIES – 84.4%			$	16,604
(Cost: $16,335)
OTHER GOVERNMENT SECURITIES (E)
Argentina – 0.5%
Republic of Argentina:
6.875%, 4-22-21 (B)		150		63
5.625%, 1-26-22 (B)		100		41
				104
Costa Rica – 1.0%
Costa Rica Government Bond
4.250%, 1-26-23 (A)		200		189

OTHER GOVERNMENT SECURITIES (E) (Continued)	Principal		Value
Mexico – 1.0%
United Mexican States
3.250%, 4-16-30	$	200	$	198
Panama – 1.1%
Republic of Panama
3.750%, 4-17-26		200		209
Qatar – 1.1%
Qatar Government Bond
3.875%, 4-23-23		200		215
Saudi Arabia – 1.3%
Saudi Arabia Government Bond
2.375%, 10-26-21 (A)		250		254
Turkey – 1.0%
Turkey Government Bond
6.350%, 8-10-24		200		202
Uruguay – 0.3%
Republica Orient Uruguay
4.500%, 8-14-24 (D)		50		55
Vietnam – 1.1%
Vietnam Government Bond
4.800%, 11-19-24 (A)		200		218
TOTAL OTHER GOVERNMENT SECURITIES – 8.4%			$	1,644
(Cost: $1,740)
UNITED STATES GOVERNMENT OBLIGATIONS
United States – 4.6%
U.S. Treasury Notes:
1.500%, 1-15-23		150		155
2.125%, 9-30-24		100		108
2.250%, 11-15-25		150		165
2.375%, 5-15-27		125		141
1.625%, 8-15-29		100		109
1.750%, 11-15-29		200		221
				899
TOTAL UNITED STATES GOVERNMENT OBLIGATIONS – 4.6%			$	899
(Cost: $825)
SHORT-TERM SECURITIES	Shares
Money Market Funds (F) – 2.1%
State Street Institutional U.S. Government Money Market Fund – Premier Class
0.120%		297		297

20 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS GLOBAL BOND (in thousands)

JUNE 30, 2020 (UNAUDITED)

SHORT-TERM SECURITIES (Continued)	Shares		Value
Money Market Funds (F) (Continued)
Dreyfus Institutional Preferred Government Money Market Fund – Institutional Shares
0.100% (G)		118	$	118
				415
TOTAL SHORT-TERM SECURITIES – 2.1%			$	415
(Cost: $415)
TOTAL INVESTMENT SECURITIES – 99.5%			$	19,562
(Cost: $19,315)
CASH AND OTHER ASSETS, NET OF LIABILITIES – 0.5%				90
NET ASSETS – 100.0%			$	19,652

Notes to Schedule of Investments

(A) Securities were purchased pursuant to an exemption from registration available under Rule 144A under the Securities Act of 1933 and may only be resold in transactions exempt from registration, normally to qualified institutional buyers. At June 30, 2020 the total value of these securities amounted to $11,532 or 58.7% of net assets.

(B) Non-income producing as the issuer has either missed its most recent interest payment or declared bankruptcy.

(C) Principal amounts are denominated in the indicated foreign currency, where applicable (COP - Columbian Peso).

(D) All or a portion of securities with an aggregate value of $115 are on loan.

(E) Other Government Securities may include emerging markets sovereign, quasi-sovereign, corporate and supranational agency and organization debt securities.

(F) Rate shown is the annualized 7-day yield at June 30, 2020.

(G) Investment made with cash collateral received from securities on loan.

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Corporate Debt Securities	$	—	$	16,604	$	—
Other Government Securities		—		1,644		—
United States Government Obligations		—		899		—
Short-Term Securities		415		—		—
Total	$	415	$	19,147	$	—

The following acronym is used throughout this schedule:

GTD = Guaranteed

2020 SEMIANNUAL REPORT 21

SCHEDULE OF INVESTMENTS GLOBAL BOND (in thousands)

JUNE 30, 2020 (UNAUDITED)

Country Diversification

(as a % of net assets)
United States	20.9%
United Kingdom	7.8%
Mexico	6.6%
Netherlands	6.4%
Brazil	5.7%
Chile	4.6%
South Korea	3.5%
China	3.2%
Canada	2.8%
Columbia	2.5%
Indonesia	2.3%
United Arab Emirates	2.1%
Luxembourg	2.1%
India	2.0%
Japan	1.8%
Peru	1.7%
Norway	1.6%

Country Diversification (Continued)

Argentina	1.3%
Saudi Arabia	1.3%
Qatar	1.1%
Cayman Islands	1.1%
Vietnam	1.1%
Hong Kong	1.1%
Panama	1.1%
Australia	1.1%
Spain	1.1%
Costa Rica	1.0%
Nigeria	1.0%
Denmark	1.0%
France	1.0%
Isle of Man	1.0%
Turkey	1.0%
Austria	1.0%
Other Countries	2.5%
Other+	2.6%

+Includes cash and other assets (net of liabilities), and cash equivalents

See Accompanying Notes to Financial Statements.

22 SEMIANNUAL REPORT 2020

PORTFOLIO HIGHLIGHTS GLOBAL EQUITY INCOME

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Stocks	98.4%
Financials	22.7%
Health Care	17.0%
Information Technology	12.0%
Consumer Staples	11.7%
Utilities	9.1%
Industrials	8.7%
Materials	5.1%
Energy	4.9%
Consumer Discretionary	4.3%
Communication Services	2.9%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	1.6%

Country Weightings

Europe	44.8%
France	13.3%
United Kingdom	10.2%
Switzerland	7.5%
Germany	4.0%
Other Europe	9.8%
North America	35.7%
United States	34.2%
Other North America	1.5%
Pacific Basin	17.9%
Japan	4.3%
Taiwan	3.6%
Other Pacific Basin	10.0%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	1.6%

Top 10 Equity Holdings

Company	Sector	Industry
Taiwan Semiconductor Manufacturing Co. Ltd.	Information Technology	Semiconductors
Cisco Systems, Inc.	Information Technology	Communications Equipment
ENEL S.p.A.	Utilities	Electric Utilities
AstraZeneca plc	Health Care	Pharmaceuticals
Samsung Electronics Co. Ltd.	Information Technology	Technology Hardware, Storage & Peripherals
Nestle S.A., Registered Shares	Consumer Staples	Packaged Foods & Meats
Roche Holdings AG, Genusscheine	Health Care	Pharmaceuticals
Verizon Communications, Inc.	Communication Services	Integrated Telecommunication Services
Procter & Gamble Co. (The)	Consumer Staples	Household Products
Amgen, Inc.	Health Care	Biotechnology

See your advisor or www.ivyinvestments.com for more information on the Portfolio’s most recently published Top 10 Equity Holdings.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

2020 SEMIANNUAL REPORT 23

SCHEDULE OF INVESTMENTS GLOBAL EQUITY INCOME (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS	Shares		Value
Canada
Financials – 1.5%
Bank of Montreal		78	$	4,178
Total Canada – 1.5%			$	4,178
China
Energy – 1.3%
CNOOC Ltd.		3,404		3,821
Total China – 1.3%			$	3,821
France
Energy – 2.3%
Total S.A. (A)		168		6,485
Financials – 4.4%
Axa S.A. (A)		309		6,508
BNP Paribas S.A.		153		6,123
				12,631
Health Care – 2.5%
Sanofi-Aventis		69		7,070
Industrials – 4.1%
Schneider Electric S.A.		67		7,399
Vinci		45		4,211
				11,610
Total France – 13.3%			$	37,796
Germany
Financials – 1.0%
Munchener Ruckversicherungs-Gesellschaft AG, Registered Shares		11		2,890
Utilities – 3.0%
E.ON AG		374		4,220
RWE Aktiengesellschaft		120		4,210
				8,430
Total Germany – 4.0%			$	11,320
Hong Kong
Utilities – 1.1%
Guangdong Investment Ltd.		1,816		3,132
Total Hong Kong – 1.1%			$	3,132
Indonesia
Financials – 1.4%
PT Bank Mandiri (Persero) Tbk		11,289		3,920
Total Indonesia – 1.4%			$	3,920

COMMON STOCKS (Continued)	Shares		Value
Ireland
Materials – 1.3%
CRH plc		111	$	3,829
Total Ireland – 1.3%			$	3,829
Italy
Utilities – 3.2%
ENEL S.p.A.		1,060		9,170
Total Italy – 3.2%			$	9,170
Japan
Consumer Discretionary – 1.4%
Subaru Corp.		187		3,914
Financials – 2.9%
ORIX Corp.		283		3,514
Tokio Marine Holdings, Inc.		112		4,894
				8,408
Total Japan – 4.3%			$	12,322
Macau
Consumer Discretionary – 1.8%
Sands China Ltd.		1,308		5,151
Total Macau – 1.8%			$	5,151
Netherlands
Financials – 1.3%
ING Groep N.V., Certicaaten Van Aandelen		524		3,656
Health Care – 1.3%
Koninklijke Philips Electronics N.V., Ordinary Shares		77		3,586
Total Netherlands – 2.6%			$	7,242
Norway
Consumer Staples – 1.4%
Mowi ASA		213		4,069
Total Norway – 1.4%			$	4,069
Russia
Energy – 1.3%
PJSC LUKOIL ADR		49		3,625
Total Russia – 1.3%			$	3,625
Singapore
Financials – 1.4%
DBS Group Holdings Ltd.		262		3,948
Total Singapore – 1.4%			$	3,948

COMMON STOCKS (Continued)	Shares		Value
South Korea
Information Technology – 3.0%
Samsung Electronics Co. Ltd.		193	$	8,543
Total South Korea – 3.0%			$	8,543
Switzerland
Consumer Staples – 3.0%
Nestle S.A., Registered Shares		77		8,524
Financials – 1.5%
Zurich Financial Services, Registered Shares		12		4,373
Health Care – 3.0%
Roche Holdings AG, Genusscheine		25		8,516
Total Switzerland – 7.5%			$	21,413
Taiwan
Information Technology – 3.6%
Taiwan Semiconductor Manufacturing Co. Ltd.		949		10,135
Total Taiwan – 3.6%			$	10,135
United Kingdom
Financials – 1.3%
3i Group plc		366		3,768
Health Care – 5.4%
AstraZeneca plc		86		8,936
GlaxoSmithKline plc		316		6,393
				15,329
Industrials – 1.2%
BAE Systems plc		594		3,554
Materials – 2.3%
Anglo American plc		279		6,437
Total United Kingdom – 10.2%			$	29,088
United States
Communication Services – 2.9%
Verizon Communications, Inc.		150		8,245
Consumer Discretionary – 1.1%
V.F. Corp.		51		3,091
Consumer Staples – 7.3%
Philip Morris International, Inc.		95		6,677
Procter & Gamble Co. (The)		68		8,097
Sysco Corp.		55		3,010
Wal-Mart Stores, Inc.		26		3,066
				20,850
Financials – 6.0%
Citigroup, Inc.		145		7,398
KeyCorp		311		3,785

24 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS GLOBAL EQUITY INCOME (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS (Continued)	Shares		Value
Financials (Continued)
Morgan Stanley		121	$	5,854
				17,037
Health Care – 4.8%
Amgen, Inc.		32		7,460
CVS Caremark Corp.		98		6,377
				13,837
Industrials – 3.4%
Eaton Corp.		55		4,799
Lockheed Martin Corp.		13		4,738
				9,537
Information Technology – 5.4%
Cisco Systems, Inc.		204		9,491
QUALCOMM, Inc.		65		5,966
				15,457

COMMON STOCKS (Continued)	Shares		Value
Materials – 1.5%
Eastman Chemical Co.		63	$	4,416
Utilities – 1.8%
Exelon Corp.		147		5,345
Total United States – 34.2%			$	97,815
TOTAL COMMON STOCKS – 98.4%			$	280,517
(Cost: $294,274)
SHORT-TERM SECURITIES
Money Market Funds (B) – 5.1%
State Street Institutional U.S. Government Money Market Fund – Premier Class 0.120%		1,423		1,423

SHORT-TERM SECURITIES (Continued)	Shares		Value
Money Market Funds (B) (Continued)
Dreyfus Institutional Preferred Government Money Market Fund – Institutional Shares 0.100% (C)		13,018	$	13,018
				14,441
TOTAL SHORT-TERM SECURITIES – 5.1%			$	14,441
(Cost: $14,441)
TOTAL INVESTMENT SECURITIES – 103.5%			$	294,958
(Cost: $308,715)
LIABILITIES, NET OF CASH AND OTHER ASSETS – (3.5)%				(9,941	)
NET ASSETS – 100.0%			$	285,017

Notes to Schedule of Investments

(A) All or a portion of securities with an aggregate value of $6,582 are on loan.

(B) Rate shown is the annualized 7-day yield at June 30, 2020.

(C) Investment made with cash collateral received from securities on loan.

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Common Stocks
Communication Services	$	8,245	$	—	$	—
Consumer Discretionary		3,091		9,065		—
Consumer Staples		20,850		12,593		—
Energy		—		13,931		—
Financials		21,215		43,594		—
Health Care		17,423		30,915		—
Industrials		9,537		15,164		—
Information Technology		15,457		18,678		—
Materials		4,416		10,266		—
Utilities		5,345		20,732		—
Total Common Stocks	$	105,579	$	174,938	$	—
Short-Term Securities		14,441		—		—
Total	$	120,020	$	174,938	$	—

The following acronym is used throughout this schedule:

ADR = American Depositary Receipts

Market Sector Diversification

(as a % of net assets)
Financials	22.7%
Health Care	17.0%
Information Technology	12.0%
Consumer Staples	11.7%
Utilities	9.1%
Industrials	8.7%

Market Sector Diversification (Continued)

Materials	5.1%
Energy	4.9%
Consumer Discretionary	4.3%
Communication Services	2.9%
Other+	1.6%

+Includes liabilities (net of cash and other assets), and cash equivalents

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 25

PORTFOLIO HIGHLIGHTS GLOBAL GROWTH

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Stocks	100.3%
Information Technology	33.5%
Consumer Discretionary	14.5%
Health Care	14.0%
Financials	12.8%
Industrials	9.9%
Communication Services	6.5%
Consumer Staples	4.6%
Energy	4.5%
Liabilities (Net of Cash and Other Assets)	-0.3%

Country Weightings

North America	61.8%
United States	58.2%
Canada	3.6%
Europe	22.6%
France	6.8%
United Kingdom	3.9%
Germany	3.7%
Switzerland	3.5%
Other Europe	4.7%
Pacific Basin	15.1%
China	7.9%
Other Pacific Basin	7.2%
South America	0.8%
Liabilities (Net of Cash and Other Assets)	-0.3%

Top 10 Equity Holdings

Company	Country	Sector	Industry
Microsoft Corp.	United States	Information Technology	Systems Software
Amazon.com, Inc.	United States	Consumer Discretionary	Internet & Direct Marketing Retail
Apple, Inc.	United States	Information Technology	Technology Hardware, Storage & Peripherals
PayPal, Inc.	United States	Information Technology	Data Processing & Outsourced Services
Ferrari N.V.	Italy	Consumer Discretionary	Automobile Manufacturers
Johnson & Johnson	United States	Health Care	Pharmaceuticals
Alimentation Couche-Tard, Inc., Class B	Canada	Consumer Staples	Food Retail
Visa, Inc., Class A	United States	Information Technology	Data Processing & Outsourced Services
Autodesk, Inc.	United States	Information Technology	Application Software
Ping An Insurance (Group) Co. of China Ltd., H Shares	China	Financials	Life & Health Insurance

See your advisor or www.ivyinvestments.com for more information on the Portfolio’s most recently published Top 10 Equity Holdings.

26 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS GLOBAL GROWTH (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS	Shares		Value
Brazil
Consumer Discretionary – 0.4%
Magazine Luiza S.A.		41	$	543
Financials – 0.4%
Banco do Brasil S.A.		62		365
XP, Inc., Class A(A)		5		212
				577
Total Brazil – 0.8%			$	1,120
Canada
Consumer Staples – 2.5%
Alimentation Couche-Tard, Inc., Class B		110		3,443
Energy – 1.1%
Canadian Natural Resources Ltd.		87		1,523
Total Canada–3.6%			$	4,966
China
Communication Services – 3.6%
Baidu.com, Inc. ADR(A)		22		2,658
Tencent Holdings Ltd.		35		2,211
				4,869
Consumer Discretionary – 1.9%
Alibaba Group Holding Ltd. ADR(A)		12		2,544
Financials – 2.4%
Ping An Insurance (Group) Co. of China Ltd., H Shares		320		3,190
Total China – 7.9%			$	10,603
France
Communication Services – 1.6%
Ubisoft Entertainment S.A.(A)		27		2,251
Consumer Discretionary – 0.6%
LVMH Moet Hennessy–Louis Vuitton		2		861
Energy – 0.5%
Total S.A. ADR		19		735
Industrials – 4.1%
Airbus SE		38		2,752
Schneider Electric S.A.		26		2,901
				5,653
Total France – 6.8%			$	9,500
Germany
Financials – 1.6%
Deutsche Boerse AG		12		2,158

COMMON STOCKS (Continued)	Shares		Value
Information Technology – 2.1%
Infineon Technologies AG		119	$	2,791
Total Germany – 3.7%			$	4,949
Hong Kong
Consumer Discretionary – 1.0%
Galaxy Entertainment Group		190		1,303
Total Hong Kong – 1.0%			$	1,303
India
Energy – 2.1%
Reliance Industries Ltd.		128		2,805
Financials – 1.0%
HDFC Bank Ltd.		99		1,388
Total India–3.1%			$	4,193
Italy
Consumer Discretionary – 2.8%
Ferrari N.V.		23		3,858
Total Italy – 2.8%			$	3,858
Japan
Industrials – 1.6%
Daikin Industries Ltd.		7		1,181
Recruit Holdings Co. Ltd.		28		966
				2,147
Total Japan – 1.6%			$	2,147
Netherlands
Health Care – 1.9%
Koninklijke Philips Electronics N.V., Ordinary Shares		54		2,501
Total Netherlands – 1.9%			$	2,501
Switzerland
Consumer Staples – 1.1%
Nestle S.A., Registered Shares		14		1,522
Health Care – 1.3%
Alcon, Inc.		32		1,848
Industrials – 1.1%
Ferguson plc		19		1,528
Total Switzerland – 3.5%			$	4,898
Taiwan
Information Technology – 1.5%
Taiwan Semiconductor Manufacturing Co. Ltd. ADR		36		2,068
Total Taiwan–1.5%			$	2,068

COMMON STOCKS (Continued)	Shares		Value
United Kingdom
Consumer Staples – 1.0%
Diageo plc		38	$	1,276
Financials – 1.0%
Prudential plc		90		1,361
Health Care – 1.9%
AstraZeneca plc		16		1,694
AstraZeneca plc ADR		19		985
				2,679
Total United Kingdom – 3.9%			$	5,316
United States
Communication Services – 1.3%
Facebook, Inc., Class A(A)		8		1,806
Consumer Discretionary – 7.8%
Amazon.com, Inc.(A)		3		6,996
Darden Restaurants, Inc.		14		1,045
Dollar General Corp.		5		947
Home Depot, Inc. (The)		6		1,610
				10,598
Energy – 0.8%
ConocoPhillips		26		1,091
Financials – 6.4%
Citigroup, Inc.		42		2,137
CME Group, Inc.		6		998
Discover Financial Services		33		1,659
Goldman Sachs Group, Inc. (The)		10		1,889
Morgan Stanley		42		2,033
				8,716
Health Care – 8.9%
Abbott Laboratories		29		2,681
HCA Holdings, Inc.		13		1,242
Johnson & Johnson		26		3,633
Thermo Fisher Scientific, Inc.		8		2,802
UnitedHealth Group, Inc.		6		1,640
				11,998
Industrials – 3.1%
Eaton Corp.		22		1,882
Northrop Grumman Corp.		8		2,312
				4,194
Information Technology – 29.9%
Adobe, Inc.(A)		6		2,474
Ambarella, Inc.(A)		36		1,652
Apple, Inc.		13		4,713
Autodesk, Inc.(A)		14		3,264
Cisco Systems, Inc.		59		2,751
Fidelity National Information Services, Inc.		19		2,611
Garter, Inc., Class A(A)		10		1,259
Intuit, Inc.		9		2,735
MasterCard, Inc., Class A		9		2,718
Microsoft Corp.		37		7,472
PayPal, Inc.(A)		24		4,188

2020 SEMIANNUAL REPORT 27

SCHEDULE OF INVESTMENTS GLOBAL GROWTH (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS (Continued)	Shares		Value
Information Technology (Continued)
VeriSign, Inc. (A)		7	$	1,527
Visa, Inc., Class A		18		3,396
				40,760
Total United States – 58.2%			$	79,163
TOTAL COMMON STOCKS – 100.3%			$	136,585
(Cost: $106,712)
TOTAL INVESTMENT SECURITIES – 100.3%			$	136,585
(Cost: $106,712)
LIABILITIES, NET OF CASH AND OTHER ASSETS – (0.3)%				(470	)
NET ASSETS – 100.0%			$	136,115

Notes to Schedule of Investments

(A) No dividends were paid during the preceding 12 months.

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Common Stocks
Communication Services	$	4,464	$	4,462	$	—
Consumer Discretionary		13,685		6,022		—
Consumer Staples		3,443		2,798		—
Energy		3,433		2,721		—
Financials		9,293		8,097		—
Health Care		15,484		3,542		—
Industrials		4,194		9,328		—
Information Technology		42,828		2,791		—
Total Common Stocks	$	96,824	$	39,761	$	—
Total	$	96,824	$	39,761	$	—

The following acronym is used throughout this schedule:

ADR = American Depositary Receipts

Market Sector Diversification

(as a % of net assets)
Information Technology	33.5%
Consumer Discretionary	14.5%
Health Care	14.0%
Financials	12.8%

Market Sector Diversification (Continued)

Industrials	9.9%
Communication Services	6.5%
Consumer Staples	4.6%
Energy	4.5%
Other+	-0.3%

+ Includes liabilities (net of cash and other assets), and cash equivalents

See Accompanying Notes to Financial Statements.

28 SEMIANNUAL REPORT 2020

PORTFOLIO HIGHLIGHTS LIMITED-TERM BOND

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Bonds	93.1%
United States Government and Government Agency Obligations	51.7%
Corporate Debt Securities	38.7%
Mortgage-Backed Securities	1.7%
Asset-Backed Securities	1.0%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	6.9%

Quality Weightings

Investment Grade	87.6%
AAA	31.8%
AA	10.5%
A	12.6%
BBB	32.7%
Non-Investment Grade	5.5%
BB	2.1%
B	0.3%
Non-rated	3.1%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	6.9%

Our preference is to always use ratings obtained from Standard & Poor’s, Moody’s, and Fitch. It is each Portfolio’s general policy to classify such security at the lower rating level if only two ratings are available. If more than two ratings are available and a median exists, the median is used. If more than two ratings exist without a median, the lower of the two middle ratings is used. We do not evaluate these ratings, but simply assign them to the appropriate credit quality category as determined by the rating agency.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

2020 SEMIANNUAL REPORT 29

SCHEDULE OF INVESTMENTS LIMITED-TERM BOND (in thousands)

JUNE 30, 2020 (UNAUDITED)

ASSET-BACKED SECURITIES	Principal		Value
American Airlines Class AA Pass-Through Certificates, Series 2016-2,
3.200%, 6-15-28	$	832	$	784
SBA Tower Trust, Series 2014-2 (GTD by SBA Guarantor LLC and SBA Holdings LLC),
3.869%, 10-8-24 (A)		2,000		2,112
SBA Tower Trust, Series 2017-1C (GTD by SBA Guarantor LLC and SBA Holdings LLC),
3.168%, 4-11-22 (A)		1,250		1,263
TOTAL ASSET-BACKED SECURITIES – 1.0%			$	4,159
(Cost: $4,175)
CORPORATE DEBT SECURITIES
Communication Services
Integrated Telecommunication Services – 1.1%
AT&T, Inc.,
3.800%, 3-15-22		2,850		3,001
Verizon Communications, Inc.,
5.150%, 9-15-23		1,290		1,468
				4,469
Wireless Telecommunication Service – 1.5%
Crown Castle Towers LLC:
3.222%, 5-15-22 (A)		4,300		4,372
3.663%, 5-15-25 (A)		950		1,013
Sprint Spectrum L.P.,
3.360%, 9-20-21 (A)		694		703
				6,088
Total Communication Services – 2.6%				10,557
Consumer Discretionary
Apparel, Accessories & Luxury Goods – 0.6%
Ralph Lauren Corp.,
1.700%, 6-15-22		1,292		1,314
VF Corp.,
2.050%, 4-23-22		1,225		1,258
				2,572
Automobile Manufacturers – 0.4%
Volkswagen Group of America, Inc.,
2.500%, 9-24-21 (A)		1,600		1,625
General Merchandise Stores – 1.6%
Dollar General Corp.,
3.250%, 4-15-23		3,440		3,673
Family Dollar Stores, Inc.,
5.000%, 2-1-21		2,500		2,542
				6,215
Internet & Direct Marketing Retail – 0.4%
Amazon.com, Inc.,
0.400%, 6-3-23		1,750		1,749
Total Consumer Discretionary – 3.0%				12,161

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Consumer Staples
Distillers & Vintners – 1.1%
Constellation Brands, Inc.:
3.200%, 2-15-23	$	1,500	$	1,592
4.250%, 5-1-23		1,188		1,305
Diageo Capital plc (GTD by Diageo plc),
3.500%, 9-18-23		1,300		1,411
				4,308
Drug Retail – 0.7%
CVS Health Corp.:
3.500%, 7-20-22		1,425		1,501
2.750%, 12-1-22		1,405		1,466
				2,967
Soft Drinks – 0.9%
Coca-Cola Refreshments USA, Inc.,
8.000%, 9-15-22		2,125		2,452
Keurig Dr Pepper, Inc.,
4.057%, 5-25-23		1,200		1,309
				3,761
Total Consumer Staples – 2.7%				11,036
Energy
Oil & Gas Equipment & Services – 0.2%
Enterprise Products Operating LLC (GTD by Enterprise Products Partners L.P.),
2.800%, 2-15-21		800		811
Oil & Gas Exploration & Production – 0.4%
Aker BP ASA,
6.000%, 7-1-22 (A)		1,000		1,018
EQT Corp.,
3.000%, 10-1-22 (B)		850		790
				1,808
Oil & Gas Storage & Transportation – 3.0%
Enbridge, Inc.,
2.900%, 7-15-22		2,470		2,563
EQT Midstream Partners L.P.,
4.750%, 7-15-23		1,500		1,513
Kinder Morgan Energy Partners L.P.:
3.500%, 3-1-21		1,000		1,013
3.450%, 2-15-23		1,646		1,725
Midwest Connector Capital Co. LLC,
3.625%, 4-1-22 (A)		1,000		1,024
Plains All American Pipeline L.P. and PAA Finance Corp.,
3.850%, 10-15-23		1,800		1,870
Sunoco Logistics Partners Operations L.P. (GTD by Sunoco Logistics Partners L.P.),
4.400%, 4-1-21		800		816
Western Gas Partners L.P.,
5.375%, 6-1-21		1,425		1,421
				11,945
Total Energy – 3.6%				14,564

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Financials
Asset Management & Custody Banks – 0.5%
Ares Capital Corp.:
3.625%, 1-19-22	$	404	$	411
3.500%, 2-10-23		1,110		1,117
National Securities Clearing Corp.,
1.200%, 4-23-23 (A)		350		355
				1,883
Consumer Finance – 2.0%
Ally Financial, Inc.,
4.250%, 4-15-21		3,889		3,959
Discover Bank,
3.350%, 2-6-23		1,830		1,930
General Motors Financial Co., Inc. (GTD by AmeriCredit Financial Services, Inc.):
3.200%, 7-6-21		1,000		1,012
5.200%, 3-20-23		1,000		1,070
				7,971
Diversified Banks – 4.5%
Bank of America Corp.,
4.100%, 7-24-23		2,983		3,276
Citizens Bank N.A.,
3.250%, 2-14-22		1,200		1,243
KeyCorp,
2.900%, 9-15-20		250		251
Mitsubishi UFJ Financial Group, Inc.,
2.998%, 2-22-22		1,500		1,554
Mizuho Financial Group, Inc.,
2.953%, 2-28-22		2,100		2,178
National Bank of Canada,
2.100%, 2-1-23		1,400		1,440
Sumitomo Mitsui Financial Group, Inc.,
2.784%, 7-12-22		1,710		1,781
Svenska Handelsbanken AB,
0.625%, 6-30-23 (A)		1,500		1,498
Synchrony Bank,
3.000%, 6-15-22		1,500		1,532
U.S. Bancorp,
5.125%, 1-15-68		3,380		3,279
				18,032
Financial Exchanges & Data – 0.7%
Intercontinental Exchange, Inc.,
3.450%, 9-21-23		1,500		1,627
Moody’s Corp.,
2.625%, 1-15-23		1,250		1,309
				2,936
Investment Banking & Brokerage – 2.5%
E*TRADE Financial Corp.,
2.950%, 8-24-22		1,580		1,646
Goldman Sachs Group, Inc. (The):
5.750%, 1-24-22		2,500		2,697
3.000%, 4-26-22		1,500		1,529
Morgan Stanley,
4.875%, 11-1-22		3,734		4,060

30 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS LIMITED-TERM BOND (in thousands)

JUNE 30, 2020 (UNAUDITED)

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Investment Banking & Brokerage (Continued)
Morgan Stanley (3-Month U.S. LIBOR plus 110 bps),
4.000%, 5-31-23 (C)	$	300	$	308
				10,240
Life & Health Insurance – 1.0%
MassMutual Global Funding II,
2.250%, 7-1-22 (A)		1,250		1,288
Metropolitan Life Global Funding I,
0.900%, 6-8-23 (A)		1,250		1,257
Reliance Standard Life Insurance II,
2.150%, 1-21-23 (A)		1,400		1,428
				3,973
Multi-Line Insurance – 0.4%
Athene Global Funding,
2.800%, 5-26-23 (A)		1,500		1,530
Other Diversified Financial Services – 1.5%
Citigroup, Inc.:
2.750%, 4-25-22		2,000		2,073
3.500%, 5-15-23		1,345		1,436
JPMorgan Chase & Co.:
4.350%, 8-15-21		1,084		1,132
2.972%, 1-15-23		1,500		1,553
				6,194
Regional Banks – 0.5%
First Horizon National Corp.,
3.550%, 5-26-23		2,000		2,064
Specialized Finance – 0.4%
AerCap Ireland Capital Ltd. and AerCap Global Aviation Trust,
4.500%, 9-15-23		1,000		1,000
Corporacion Andina de Fomento,
2.375%, 5-12-23		500		513
				1,513
Total Financials – 14.0%				56,336
Health Care
Health Care Equipment – 0.3%
Becton Dickinson & Co.,
2.894%, 6-6-22		1,000		1,035
Pharmaceuticals – 1.4%
AbbVie, Inc.,
2.300%, 11-21-22 (A)		1,400		1,447
Elanco Animal Health, Inc.,
5.022%, 8-28-23 (D)		1,700		1,785
Zoetis, Inc.,
3.250%, 2-1-23		2,415		2,549
				5,781
Total Health Care – 1.7%				6,816

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Industrials
Aerospace & Defense – 1.2%
BAE Systems plc,
4.750%, 10-11-21 (A)	$	1,170	$	1,222
Boeing Co. (The),
2.800%, 3-1-23		2,250		2,292
Spirit AeroSystems, Inc. (GTD by Spirit AeroSystems Holdings, Inc.),
3.950%, 6-15-23		1,400		1,183
				4,697
Agricultural & Farm Machinery – 0.7%
CNH Industrial Capital LLC (GTD by CNH Industrial Capital America LLC and New Holland Credit Co. LLC),
1.950%, 7-2-23		1,000		1,007
John Deere Capital Corp.:
0.550%, 7-5-22		750		752
0.700%, 7-5-23		1,250		1,254
				3,013
Airlines – 0.8%
Delta Air Lines, Inc.,
3.400%, 4-19-21		1,800		1,750
Southwest Airlines Co.,
4.750%, 5-4-23		1,250		1,291
				3,041
Building Products – 0.2%
Masco Corp.,
3.500%, 4-1-21		800		811
Environmental & Facilities Services – 1.4%
Waste Management, Inc. (GTD by Waste Management Holdings, Inc.):
2.400%, 5-15-23		3,843		4,008
2.950%, 6-15-24 (B)		1,800		1,843
				5,851
Industrial Conglomerates – 0.2%
General Electric Capital Corp.,
5.012%, 1-1-24		695		725
Total Industrials – 4.5%				18,138
Information Technology
Application Software – 0.1%
Infor, Inc.,
1.450%, 7-15-23 (A)		500		504
Data Processing & Outsourced Services – 0.8%
Fiserv, Inc.,
3.500%, 10-1-22		1,000		1,057
PayPal Holdings, Inc.,
1.350%, 6-1-23		2,250		2,297
				3,354

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
IT Consulting & Other Services – 0.2%
Leidos, Inc. (GTD by Leidos Holdings, Inc.),
2.950%, 5-15-23 (A)	$	775	$	807
Semiconductors – 0.7%
Broadcom, Inc.,
3.125%, 10-15-22 (A)		810		844
Microchip Technology, Inc.,
3.922%, 6-1-21		2,000		2,039
				2,883
Technology Hardware, Storage & Peripherals – 0.3%
NetApp, Inc.,
3.375%, 6-15-21		1,000		1,022
Total Information Technology – 2.1%				8,570
Materials
Diversified Chemicals – 0.3%
DuPont De Nemours, Inc.,
2.169%, 5-1-23		1,225		1,248
Fertilizers & Agricultural Chemicals – 0.1%
Nutrien Ltd.,
1.900%, 5-13-23		500		516
Total Materials – 0.4%				1,764
Real Estate
Specialized REITs – 1.6%
American Tower Corp.:
3.300%, 2-15-21		1,000		1,017
2.250%, 1-15-22		590		605
3.070%, 3-15-23 (A)		3,335		3,412
Crown Castle International Corp.:
4.875%, 4-15-22		1,000		1,068
3.150%, 7-15-23		400		427
				6,529
Total Real Estate – 1.6%				6,529
Utilities
Electric Utilities – 2.2%
CenterPoint Energy, Inc.,
2.500%, 9-1-22		3,000		3,105
Entergy Texas, Inc.,
2.550%, 6-1-21		1,275		1,295
Evergy, Inc.,
5.292%, 6-15-22 (D)		1,154		1,232
MidAmerican Energy Co.,
3.700%, 9-15-23		1,045		1,132
Virginia Electric and Power Co., Series C,
2.750%, 3-15-23		2,000		2,103
				8,867

2020 SEMIANNUAL REPORT 31

SCHEDULE OF INVESTMENTS LIMITED-TERM BOND (in thousands)

JUNE 30, 2020 (UNAUDITED)

CORPORATE DEBT SECURITIES (Continued)	Principal		Value
Multi-Utilities – 0.3%
Dominion Energy Gas Holdings LLC,
3.550%, 11-1-23	$	1,235	$	1,327
Total Utilities – 2.5%				10,194
TOTAL CORPORATE DEBT SECURITIES – 38.7%			$	156,665
(Cost: $153,103)
MORTGAGE-BACKED SECURITIES
Non-Agency REMIC/CMO – 1.7%
COLT Funding LLC, Series 2018-4, Class M1 (Mortgage spread to 3-year U.S. Treasury index),
4.716%, 12-28-48 (A)(C)		1,400		1,402
Credit Suisse Mortgage Trust, Series 2018-RPL8, Class A1 (Mortgage spread to 3-year U.S. Treasury index),
4.125%, 7-25-58 (A)(C)		996		1,020
JPMorgan Chase Commercial Mortgage Securities Corp., Series 2014-FRR1, Class A-K10,
4.286%, 11-27-49 (A)		3,700		3,636
Verus Securitization Trust, Series 2018-3, Class B1 (Mortgage spread to 5-year U.S. Treasury index),
5.694%, 10-25-58 (A)(C)		700		649
				6,707
TOTAL MORTGAGE-BACKED SECURITIES – 1.7%			$	6,707
(Cost: $6,782)
UNITED STATES GOVERNMENT AGENCY OBLIGATIONS
Agency Obligations – 1.1%
Federal Home Loan Bank,
2.250%, 7-21-31		1,640		1,659
U.S. Department of Transportation,
6.001%, 12-7-21 (A)		2,500		2,695
				4,354
Mortgage-Backed Obligations – 12.4%
Federal Home Loan Mortgage Corp. Agency REMIC/CMO,
2.500%, 5-15-44		463		483
Federal Home Loan Mortgage Corp. Agency REMIC/CMO (1-Month U.S. LIBOR plus 185 bps),
2.033%, 8-25-25 (A)(C)		1,727		1,621

UNITED STATES GOVERNMENT AGENCY OBLIGATIONS (Continued)	Principal		Value
Mortgage-Backed Obligations (Continued)
Federal Home Loan Mortgage Corp. Agency REMIC/CMO (1-Month U.S. LIBOR plus 250 bps),
2.683%, 11-25-24 (A)(C)	$	467	$	451
Federal Home Loan Mortgage Corp. Agency REMIC/CMO (1-Month U.S. LIBOR plus 255 bps),
2.733%, 6-25-27 (A)(C)		473		447
Federal Home Loan Mortgage Corp. Agency REMIC/CMO (1-Month U.S. LIBOR plus 435 bps),
4.533%, 11-25-21 (A)(C)		2,923		2,918
Federal Home Loan Mortgage Corp. Agency REMIC/CMO (3-Year U.S. Treasury index plus 315 bps),
4.735%, 11-25-49 (A)(C)		2,120		2,129
Federal Home Loan Mortgage Corp. Agency REMIC/CMO (Mortgage spread to 1-Month U.S. LIBOR):
3.433%, 6-25-21 (A)(C)		189		187
4.183%, 9-25-22 (A)(C)		359		356
Federal Home Loan Mortgage Corp. Agency REMIC/CMO (Mortgage spread to 2-year U.S. Treasury index),
3.754%, 11-25-47 (A)(C)		1,500		1,509
Federal Home Loan Mortgage Corp. Agency REMIC/CMO (Mortgage spread to 3-year U.S. Treasury index):
3.510%, 7-25-22 (A)(C)		1,720		1,775
4.121%, 2-25-46 (A)(C)		70		71
3.744%, 7-25-46 (A)(C)		2,000		2,053
3.681%, 11-25-47 (A)(C)		5,000		5,048
Federal Home Loan Mortgage Corp. Agency REMIC/CMO (Mortgage spread to 5-year U.S. Treasury index):
3.598%, 11-25-23 (A)(C)		600		610
3.705%, 11-25-23 (A)(C)		10,870		11,161
4.003%, 5-25-45 (A)(C)		600		623
3.667%, 6-25-45 (A)(C)		1,000		1,032
3.681%, 11-25-47 (A)(C)		2,724		2,808
3.663%, 2-25-48 (A)(C)		1,000		1,024
3.710%, 6-25-48 (A)(C)		1,170		1,245
Federal Home Loan Mortgage Corp. Agency REMIC/CMO (Mortgage spread to 7-year U.S. Treasury index):
3.701%, 6-25-22 (A)(C)		2,000		2,069
4.194%, 5-25-25 (A)(C)		225		244
3.800%, 11-25-49 (A)(C)		1,900		2,002
3.763%, 11-25-50 (A)(C)		5,650		5,942
Federal Home Loan Mortgage Corp. Fixed Rate Participation Certificates,
4.500%, 8-1-30		449		487
Federal National Mortgage Association Fixed Rate Pass-Through Certificates:
3.680%, 2-1-21		200		201
4.381%, 6-1-21		736		759

UNITED STATES GOVERNMENT AGENCY OBLIGATIONS (Continued)	Principal		Value
Mortgage-Backed Obligations (Continued)
Government National Mortgage Association Agency REMIC/CMO,
2.000%, 3-16-42	$	597	$	616
				49,871
TOTAL UNITED STATES GOVERNMENT AGENCY OBLIGATIONS – 13.5%			$	54,225
(Cost: $53,290)
UNITED STATES GOVERNMENT OBLIGATIONS
Treasury Obligations – 38.2%
U.S. Treasury Notes:
2.500%, 2-28-21		500		508
2.625%, 5-15-21		11,800		12,052
1.500%, 8-31-21		5,675		5,762
2.750%, 9-15-21		1,000		1,031
1.500%, 9-30-21		9,000		9,149
2.875%, 10-15-21		18,400		19,040
1.500%, 11-30-21		24,850		25,317
2.125%, 12-31-21		16,000		16,467
1.500%, 1-31-22		14,750		15,058
1.875%, 2-28-22		19,000		19,536
1.750%, 4-30-22		13,000		13,377
1.750%, 5-31-22		2,250		2,318
2.000%, 7-31-22		10,000		10,382
1.375%, 10-15-22		1,000		1,027
2.375%, 1-31-23		2,250		2,377
2.500%, 3-31-23		1,000		1,064
				154,465
TOTAL UNITED STATES GOVERNMENT OBLIGATIONS – 38.2%			$	154,465
(Cost: $150,019)
SHORT-TERM SECURITIES
Commercial Paper (E) – 6.6%
American Honda Finance Corp. (GTD by Honda Motor Co.),
0.240%, 7-21-20		3,000		3,000
AT&T, Inc.,
0.180%, 10-2-20		1,000		999
Campbell Soup Co.,
0.380%, 8-11-20		1,000		1,000
General Motors Financial Co., Inc.:
0.670%, 7-1-20		7,100		7,100
0.900%, 7-7-20		5,000		4,999
Mondelez International, Inc.:
0.190%, 7-1-20		4,497		4,497
0.230%, 7-6-20		5,000		5,000
				26,595
Master Note – 0.2%
Toyota Motor Credit Corp. (1-Week U.S. LIBOR plus 25 bps),
0.360%, 7-7-20 (F)		641		641

32 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS LIMITED-TERM BOND (in thousands)

JUNE 30, 2020 (UNAUDITED)

SHORT-TERM SECURITIES (Continued)	Shares		Value
Money Market Funds (H) – 0.3%
Dreyfus Institutional Preferred Government Money Market Fund – Institutional Shares,
0.100% (G)		419	$	419
State Street Institutional U.S. Government Money Market Fund – Premier Class,
0.120%		977		977
				1,396
TOTAL SHORT-TERM SECURITIES – 7.1%			$	28,632
(Cost: $28,627)
TOTAL INVESTMENT SECURITIES – 100.2%			$	404,853
(Cost: $395,996)
LIABILITIES, NET OF CASH AND OTHER ASSETS – (0.2)%				(868	)
NET ASSETS – 100.0%			$	403,985

Notes to Schedule of Investments

(A) Securities were purchased pursuant to an exemption from registration available under Rule 144A under the Securities Act of 1933 and may only be resold in transactions exempt from registration, normally to qualified institutional buyers. At June 30, 2020 the total value of these securities amounted to $85,449 or 21.2% of net assets.

(B) All or a portion of securities with an aggregate value of $418 are on loan.

(C) Variable rate security. Interest rate disclosed is that which is in effect at June 30, 2020. Description of the reference rate and spread, if applicable, are included in the security description.

(D) Step bond that pays an initial coupon rate for the first period and then a higher or lower coupon rate for the following periods. Interest rate disclosed is that which is in effect at June 30, 2020.

(E) Rate shown is the yield to maturity at June 30, 2020.

(F) Variable rate security. Interest rate disclosed is that which is in effect at June 30, 2020. Date shown represents the date that the variable rate resets. Description of the reference rate and spread, if applicable, are included in the security description.

(G) Investment made with cash collateral received from securities on loan.

(H) Rate shown is the annualized 7-day yield at June 30, 2020.

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Asset-Backed Securities	$	—	$	4,159	$	—
Corporate Debt Securities		—		156,665		—
Mortgage-Backed Securities		—		6,707		—
United States Government Agency Obligations		—		54,225		—
United States Government Obligations		—		154,465		—
Short-Term Securities		1,396		27,236		—
Total	$	1,396	$	403,457	$	—

The following acronyms are used throughout this schedule:

CMO = Collateralized Mortgage Obligation

GTD = Guaranteed

LIBOR = London Interbank Offered Rate

REIT = Real Estate Investment Trust

REMIC = Real Estate Mortgage Investment Conduit

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 33

PORTFOLIO HIGHLIGHTS SECURIAN REAL ESTATE SECURITIES

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Stocks	96.8%
Real Estate	96.4%
Consumer Discretionary	0.4%
Cash and Other Assets (Net of Liabilities), and Cash Equivalents+	3.2%

Top 10 Equity Holdings

Company	Sector	Industry
ProLogis, Inc.	Real Estate	Industrial REITs
Equinix, Inc.	Real Estate	Specialized REITs
Duke Realty Corp.	Real Estate	Industrial REITs
Alexandria Real Estate Equities, Inc.	Real Estate	Office REITs
Digital Realty Trust, Inc.	Real Estate	Specialized REITs
Public Storage, Inc.	Real Estate	Specialized REITs
Healthpeak Properties, Inc.	Real Estate	Health Care REITs
Invitation Homes, Inc.	Real Estate	Residential REITs
Welltower, Inc.	Real Estate	Health Care REITs
AvalonBay Communities, Inc.	Real Estate	Residential REITs

See your advisor or www.ivyinvestments.com for more information on the Portfolio’s most recently published Top 10 Equity Holdings.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

34 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS SECURIAN REAL ESTATE SECURITIES (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS	Shares		Value
Consumer Discretionary
Hotels, Resorts & Cruise Lines – 0.4%
Marriott International, Inc., Class A		1	$	120
Total Consumer Discretionary – 0.4%				120
Real Estate
Diversified REITs – 2.9%
STORE Capital Corp.		16		372
VEREIT, Inc.		72		464
				836
Health Care REITs – 9.6%
Healthcare Trust of America, Inc., Class A		16		419
Healthpeak Properties, Inc.		32		876
Omega Healthcare Investors, Inc.		10		306
Physicians Realty Trust		9		151
Ventas, Inc.		6		209
Welltower, Inc.		16		823
				2,784
Hotel & Resort REITs – 2.1%
Host Hotels & Resorts, Inc.		28		303
Park Hotels & Resorts, Inc.		17		171
RLJ Lodging Trust		14		132
				606
Industrial REITs – 15.2%
Duke Realty Corp.		34		1,200
First Industrial Realty Trust, Inc.		15		584
ProLogis, Inc.		28		2,643
				4,427
Office REITs – 9.7%
Alexandria Real Estate Equities, Inc.		7		1,111
Boston Properties, Inc.		7		651
Cousins Properties, Inc. (A)		17		500
Highwoods Properties, Inc.		8		284
Kilroy Realty Corp.		4		258
				2,804
Residential REITs – 20.8%
American Homes 4 Rent (A)		30		807
Apartment Investment and Management Co., Class A		3		128
AvalonBay Communities, Inc.		5		814
Camden Property Trust		8		693
Equity Lifestyle Properties, Inc.		6		350
Equity Residential		6		348
Essex Property Trust, Inc.		2		539
Invitation Homes, Inc.		30		826
Mid-America Apartment Communities, Inc.		3		390
Sun Communities, Inc.		5		611
UDR, Inc.		14		534
				6,040

COMMON STOCKS (Continued)	Shares		Value
Retail REITs – 8.5%
Agree Realty Corp.		6	$	374
Brixmor Property Group, Inc.		26		335
Realty Income Corp.		11		672
Regency Centers Corp.		5		233
Simon Property Group, Inc.		6		420
Taubman Centers, Inc.		6		215
Weingarten Realty Investors		12		218
				2,467
Specialized REITs – 27.6%
American Tower Corp., Class A		1		284
Crown Castle International Corp.		1		134
CubeSmart		7		194
CyrusOne, Inc.		10		757
Digital Realty Trust, Inc.		8		1,080
Equinix, Inc.		4		2,524
Extra Space Storage, Inc.		4		406
Four Corners Property Trust, Inc.		5		125
Gaming and Leisure Properties, Inc.		9		321
Public Storage, Inc.		5		1,017
QTS Realty Trust, Inc., Class A		8		519
VICI Properties, Inc.		33		661
				8,022
Total Real Estate – 96.4%				27,986
TOTAL COMMON STOCKS – 96.8%			$	28,106
(Cost: $29,652)
SHORT-TERM SECURITIES
Money Market Funds (B) – 2.8%
State Street Institutional U.S. Government Money Market Fund – Premier Class, 0.120%		802		802
TOTAL SHORT-TERM SECURITIES – 2.8%			$	802
(Cost: $802)
TOTAL INVESTMENT SECURITIES – 99.6%			$	28,908
(Cost: $30,454)
CASH AND OTHER ASSETS, NET OF LIABILITIES – 0.4%				117
NET ASSETS – 100.0%			$	29,025

2020 SEMIANNUAL REPORT 35

SCHEDULE OF INVESTMENTS SECURIAN REAL ESTATE SECURITIES (in thousands)

JUNE 30, 2020 (UNAUDITED)

Notes to Schedule of Investments

(A) Listed on an exchange outside the United States.

(B) Rate shown is the annualized 7-day yield at June 30, 2020.

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Common Stocks	$	28,106	$	—	$	—
Short-Term Securities		802		—		—
Total	$	28,908	$	—	$	—

The following acronym is used throughout this schedule:

REIT = Real Estate Investment Trust

See Accompanying Notes to Financial Statements.

36 SEMIANNUAL REPORT 2020

PORTFOLIO HIGHLIGHTS VALUE

ALL DATA AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Stocks	98.4%
Financials	23.9%
Health Care	14.2%
Information Technology	11.6%
Industrials	8.8%
Consumer Discretionary	8.6%
Consumer Staples	7.1%
Utilities	6.8%
Communication Services	5.6%
Energy	5.5%
Materials	4.2%
Real Estate	2.1%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	1.6%

Top 10 Equity Holdings

Company	Sector	Industry
Wal-Mart Stores, Inc.	Consumer Staples	Hypermarkets & Super Centers
Citigroup, Inc.	Financials	Other Diversified Financial Services
CVS Caremark Corp.	Health Care	Health Care Services
Comcast Corp., Class A	Communication Services	Cable & Satellite
Philip Morris International, Inc.	Consumer Staples	Tobacco
Fidelity National Information Services, Inc.	Information Technology	Data Processing & Outsourced Services
Lam Research Corp.	Information Technology	Semiconductor Equipment
Eaton Corp.	Industrials	Electrical Components & Equipment
McKesson Corp.	Health Care	Health Care Distributors
AutoZone, Inc.	Consumer Discretionary	Automotive Retail

See your advisor or www.ivyinvestments.com for more information on the Portfolio’s most recently published Top 10 Equity Holdings.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

2020 SEMIANNUAL REPORT 37

SCHEDULE OF INVESTMENTS VALUE (in thousands)

JUNE 30, 2020 (UNAUDITED)

COMMON STOCKS	Shares		Value
Communication Services
Advertising – 2.2%
Omnicom Group, Inc.		156	$	8,507
Cable & Satellite – 3.4%
Comcast Corp., Class A		347		13,542
Total Communication Services – 5.6%				22,049
Consumer Discretionary
Automotive Retail – 2.9%
AutoZone, Inc. (A)(B)		10		11,327
Casinos & Gaming – 0.6%
Las Vegas Sands, Inc.		50		2,260
General Merchandise Stores – 2.4%
Target Corp.		81		9,689
Home Improvement Retail – 2.7%
Lowe’s Co., Inc.		78		10,605
Total Consumer Discretionary – 8.6%				33,881
Consumer Staples
Hypermarkets & Super Centers – 3.7%
Wal-Mart Stores, Inc.		123		14,792
Tobacco – 3.4%
Philip Morris International, Inc.		192		13,423
Total Consumer Staples – 7.1%				28,215
Energy
Integrated Oil & Gas – 0.7%
Total S.A. ADR		70		2,707
Oil & Gas Refining & Marketing – 4.8%
Phillips 66		130		9,377
Valero Energy Corp.		165		9,708
				19,085
Total Energy – 5.5%				21,792
Financials
Asset Management & Custody Banks – 2.2%
Ameriprise Financial, Inc.		57		8,595
Consumer Finance – 4.3%
Capital One Financial Corp.		147		9,174
Synchrony Financial		351		7,771
				16,945
Diversified Banks – 5.3%
Bank of America Corp.		423		10,047
Bank of New York Mellon Corp. (The)		283		10,929
				20,976

COMMON STOCKS (Continued)	Shares		Value
Investment Banking & Brokerage – 1.6%
Morgan Stanley		127	$	6,132
Mortgage REITs – 2.3%
AGNC Investment Corp.		718		9,261
Other Diversified Financial Services – 3.7%
Citigroup, Inc.		285		14,568
Property & Casualty Insurance – 2.8%
Allstate Corp. (The)		115		11,194
Reinsurance – 1.7%
Reinsurance Group of America, Inc.		87		6,790
Total Financials – 23.9%				94,461
Health Care
Biotechnology – 2.7%
Amgen, Inc.		45		10,617
Health Care Distributors – 2.8%
McKesson Corp.		74		11,332
Health Care Facilities – 2.6%
HCA Holdings, Inc.		105		10,223
Health Care Services – 3.4%
CVS Caremark Corp. (B)		209		13,572
Pharmaceuticals – 2.7%
GlaxoSmithKline plc ADR		260		10,593
Total Health Care – 14.2%				56,337
Industrials
Aerospace & Defense – 3.9%
Northrop Grumman Corp.		25		7,781
Raytheon Technologies Corp.		123		7,573
				15,354
Airlines – 1.0%
Delta Air Lines, Inc.		142		3,982
Electrical Components & Equipment – 3.9%
Eaton Corp.		130		11,409
nVent Electric plc		214		4,003
				15,412
Total Industrials – 8.8%				34,748
Information Technology
Application Software – 2.7%
NXP Semiconductors N.V.		92		10,530
Data Processing & Outsourced Services – 3.1%
Fidelity National Information Services, Inc.		91		12,226

COMMON STOCKS (Continued)	Shares		Value
Semiconductor Equipment – 3.0%
Lam Research Corp.		37	$	11,949
Semiconductors – 2.8%
Broadcom Corp., Class A		36		11,292
Total Information Technology – 11.6%				45,997
Materials
Diversified Metals & Mining – 2.1%
BHP Billiton Ltd. ADR		166		8,265
Paper Packaging – 2.1%
Graphic Packaging Holding Co.		612		8,564
Total Materials – 4.2%				16,829
Real Estate
Health Care REITs – 2.1%
Welltower, Inc.		158		8,183
Total Real Estate – 2.1%				8,183
Utilities
Electric Utilities – 6.8%
Duke Energy Corp.		42		3,372
Entergy Corp.		49		4,606
Evergy, Inc.		141		8,348
Exelon Corp.		294		10,681
				27,007
Total Utilities – 6.8%				27,007
TOTAL COMMON STOCKS – 98.4%			$	389,499
(Cost: $416,524)
SHORT-TERM SECURITIES
Money Market Funds (C) – 1.6%
State Street Institutional U.S. Government Money Market Fund – Premier Class,
0.120%		6,294		6,294
TOTAL SHORT-TERM SECURITIES – 1.6%			$	6,294
(Cost: $6,294)
TOTAL INVESTMENT SECURITIES – 100.0%			$	395,793
(Cost: $422,818)
LIABILITIES, NET OF CASH AND OTHER ASSETS – 0.0%				(35	)
NET ASSETS – 100.0%			$	395,758

38 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS VALUE (in thousands)

JUNE 30, 2020 (UNAUDITED)

Notes to Schedule of Investments

(A) No dividends were paid during the preceding 12 months.

(B) All or a portion of securities with an aggregate value of $2,562 are held in collateralized accounts to cover potential obligations with respect to outstanding written options.

(C) Rate shown is the annualized 7-day yield at June 30, 2020.

The following written options were outstanding at June 30, 2020 (contracts and exercise prices unrounded):

Underlying Security	Counterparty, if OTC	Type	Number of Contracts		Notional Amount	Expiration Month	Exercise Price		Premium Received		Value
CenterPoint Energy, Inc.	N/A	Put		883	88	August 2020	$	15.00	$	75	$	(22	)
Graphic Packaging Holding Co.	N/A	Put		1,253	125	September 2020		15.00		248		(222	)
Lam Research Corp.	N/A	Call		18	2	December 2020		295.00		87		(103	)
nVent Electric plc	JPMorgan Chase Bank N.A.	Put		717	72	August 2020		25.00		589		(452	)
Reinsurance Group of America, Inc.	UBS AG	Put		170	17	October 2020		135.00		1,326		(986	)
	JPMorgan Chase Bank N.A.	Put		168	17	October 2020		140.00		89		(1,055	)
	N/A	Put		168	17	January 2021		135.00		823		(1,000	)
									$	3,237	$	(3,840	)

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Common Stocks	$	389,499	$	—	$	—
Short-Term Securities		6,294		—		—
Total	$	395,793	$	—	$	—
Liabilities
Written Options	$	22	$	3,818	$	—

The following acronyms are used throughout this schedule:

ADR = American Depository Receipt

OTC = Over the Counter

REIT = Real Estate Investment Trust

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 39

STATEMENTS OF ASSETS AND LIABILITIES IVY VIP

AS OF JUNE 30, 2020 (UNAUDITED)

(In thousands, except per share amounts)	Core Equity				Corporate Bond				Global Bond				Global Equity Income				Global Growth			Limited- Term Bond				Securian Real Estate Securities				Value
ASSETS
Investments in unaffiliated securities at value+^		$	660,286			$	626,712			$	19,562			$	294,958			$	136,585		$	404,853			$	28,908			$	395,793
Investments at Value			660,286				626,712				19,562				294,958				136,585			404,853				28,908				395,793
Cash			—				—				—				—				—			—				—	*			—
Restricted cash			—				114				—				—				—			—				—				—
Investment securities sold receivable			—				957				1				2,093				—			9				109				3,444
Dividends and interest receivable			116				5,150				272				1,393				289			2,147				93				881
Capital shares sold receivable			—	*			634				16				2				23			—	*			8				10
Receivable from affiliates			169				—				—				—				78			—				—				—
Receivable from securities lending income – net			—				1				—	*			16				1			—	*			—				1
Variation margin receivable			—				10				—				—				—			—				—				—
Prepaid and other assets			—				—	*			—				—				—			—				—				—
Total Assets			660,571				633,578				19,851				298,462				136,976			407,009				29,118				400,129
LIABILITIES
Cash collateral on securities loaned at value			—				1,671				118				13,018				—			419				—				—
Investment securities purchased payable			437				3,354				70				—				—			1,987				75				—
Capital shares redeemed payable			616				632				3				361				117			560				—	*			453
Independent Trustees and Chief Compliance Officer fees payable			78				55				1				33				38			25				6				45
Overdraft due to custodian			—				—				—				—				630			—				—				—
Distribution and service fees payable			5				4				—	*			2				1			3				—	*			3
Investment management fee payable			12				8				—				6				3			5				1				8
Accounting services fee payable			13				13				1				8				5			10				2				10
Written options at value+			—				—				—				—				—			—				—				3,840
Other liabilities			19				18				6				17				67			15				9				12
Total Liabilities			1,180				5,755				199				13,445				861			3,024				93				4,371
Commitments and Contingencies (See Note 2 and Note 10)
Total Net Assets		$	659,391			$	627,823			$	19,652			$	285,017			$	136,115		$	403,985			$	29,025			$	395,758
NET ASSETS
Capital paid in (shares authorized – unlimited)		$	567,033			$	565,918			$	20,183			$	301,758			$	105,502		$	391,239			$	30,957			$	410,385
Accumulated earnings gain (loss)			92,358				61,905				(531	)			(16,741	)			30,613			12,746				(1,932	)			(14,627	)
Total Net Assets		$	659,391			$	627,823			$	19,652			$	285,017			$	136,115		$	403,985			$	29,025			$	395,758
CAPITAL SHARES OUTSTANDING:
Class II			56,486				108,160				3,976				56,550				39,316			81,549				4,649				76,398
NET ASSET VALUE PER SHARE:
Class II		$	11.67			$	5.80			$	4.94			$	5.04			$	3.46		$	4.95			$	6.24			$	5.18
+COST
Investments in unaffiliated securities at cost		$	567,978			$	587,221			$	19,315			$	308,715			$	106,712		$	395,996			$	30,454			$	422,818
Written options premiums received at cost			—				—				—				—				—			—				—				3,237
^Securities loaned at value			—				1,838				115				6,582				—			418				—				—

*Not shown due to rounding.

See Accompanying Notes to Financial Statements.

40 SEMIANNUAL REPORT 2020

STATEMENTS OF OPERATIONS IVY VIP

FOR THE SIX MONTHS ENDED JUNE 30, 2020 (UNAUDITED)

(In thousands)	Core Equity				Corporate Bond				Global Bond				Global Equity Income				Global Growth				Limited- Term Bond				Securian Real Estate Securities				Value
INVESTMENT INCOME
Dividends from unaffiliated securities		$	5,170			$	—			$	—			$	5,570			$	897			$	—			$	517			$	6,319
Foreign dividend withholding tax			(6	)			—				—				(462	)			(69	)			—				—				(19	)
Interest and amortization from unaffiliated securities			34				10,005				440				20				7				5,395				2				74
Securities lending income – net			—				8				2				23				1				2				—				34
Total Investment Income			5,198				10,013				442				5,151				836				5,397				519				6,408
EXPENSES
Investment management fee			2,295				1,426				61				964				566				1,028				137				1,507
Distribution and service fees:
Class II			819				750				25				344				166				514				38				538
Shareholder servicing:
Class II			—	*			—	*			—	*			—	*			—	*			—	*			—	*			—	*
Custodian fees			6				4				3				15				7				4				2				3
Independent Trustees and Chief Compliance Officer fees			38				26				3				7				8				14				3				12
Accounting services fee			81				78				7				45				31				62				13				63
Professional fees			31				43				37				29				37				40				38				32
Third-party valuation service fees			—	*			—	*			—				3				6				—				—				—
Other			19				13				2				21				7				9				3				11
Total Expenses			3,289				2,340				138				1,428				828				1,671				234				2,166
Less:
Expenses in excess of limit			(169	)			—				(61	)			—				(78	)			—				(14	)			—
Total Net Expenses			3,120				2,340				77				1,428				750				1,671				220				2,166
Net Investment Income			2,078				7,673				365				3,723				86				3,726				299				4,242
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:
Investments in unaffiliated securities			(1,858	)			17,863				(73	)			(4,873	)			4,511				6,130				(702	)			8,470
Futures contracts			—				(746	)			—				—				—				—				—				—
Written options			—				—				—				—				—				—				—				(2,268	)
Foreign currency exchange transactions			(5	)			—				—	*			—				(7	)			—				—				—
Net change in unrealized appreciation (depreciation) on:
Investments in unaffiliated securities			(10,525	)			9,949				(45	)			(38,431	)			(8,770	)			1,730				(4,104	)			(96,592	)
Futures contracts			—				(19	)			—				—				—				—				—				—
Written options			—				—				—				—				—				—				—				(769	)
Foreign currency exchange transactions			—				—				—	*			7				—	*			—				—				—
Net Realized and Unrealized Gain (Loss)			(12,388	)			27,047				(118	)			(43,297	)			(4,266	)			7,860				(4,806	)			(91,159	)
Net Increase (Decrease) in Net Assets Resulting from Operations		$	(10,310	)		$	34,720			$	247			$	(39,574	)		$	(4,180	)		$	11,586			$	(4,507	)		$	(86,917	)

* Not shown due to rounding.

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 41

STATEMENTS OF CHANGES IN NET ASSETS IVY VIP

	Core Equity								Corporate Bond								Global Bond
(In thousands)	Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19				Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19				Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income		$	2,078			$	3,660			$	7,673			$	15,182			$	365			$	855
Net realized gain (loss) on investments			(1,863	)			39,097				17,117				7,968				(73	)			71
Net change in unrealized appreciation (depreciation)			(10,525	)			141,906				9,930				40,261				(45	)			1,024
Net Increase (Decrease) in Net Assets Resulting from Operations			(10,310	)			184,663				34,720				63,411				247				1,950
Distributions to Shareholders From:
Accumulated earnings:
(combined net investment income and net realized gains)
Class II			(41,268	)			(73,214	)			(15,230	)			(15,235	)			(784	)			(784	)
Total Distributions to Shareholders			(41,268	)			(73,214	)			(15,230	)			(15,235	)			(784	)			(784	)
Capital Share Transactions			(12,306	)			(14,607	)			8,531				7,718				(413	)			(2,406	)
Net Increase (Decrease) in Net Assets			(63,884	)			96,842				28,021				55,894				(950	)			(1,240	)
Net Assets, Beginning of Period			723,275				626,433				599,802				543,908				20,602				21,842
Net Assets, End of Period		$	659,391			$	723,275			$	627,823			$	599,802			$	19,652			$	20,602
	Global Equity Income								Global Growth								Limited-Term Bond
(In thousands)	Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19				Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19				Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income		$	3,723			$	7,412			$	86			$	596			$	3,726			$	9,982
Net realized gain (loss) on investments			(4,873	)			(1,045	)			4,504				(3,622	)			6,130				2,068
Net change in unrealized appreciation (depreciation)			(38,424	)			54,983				(8,770	)			36,179				1,730				10,182
Net Increase (Decrease) in Net Assets Resulting from Operations			(39,574	)			61,350				(4,180	)			33,153				11,586				22,232
Distributions to Shareholders From:
Accumulated earnings:
(combined net investment income and net realized gains)
Class II			(8,016	)			(85,169	)			(585	)			(96,488	)			(10,693	)			(9,903	)
Total Distributions to Shareholders			(8,016	)			(85,169	)			(585	)			(96,488	)			(10,693	)			(9,903	)
Capital Share Transactions			36,023				36,767				(7,462	)			77,403				(49,450	)			(101,449	)
Net Increase (Decrease) in Net Assets			(11,567	)			12,948				(12,227	)			14,068				(48,557	)			(89,120	)
Net Assets, Beginning of Period			296,584				283,636				148,342				134,274				452,542				541,662
Net Assets, End of Period		$	285,017			$	296,584			$	136,115			$	148,342			$	403,985			$	452,542

See Accompanying Notes to Financial Statements.

42 SEMIANNUAL REPORT 2020

STATEMENTS OF CHANGES IN NET ASSETS IVY VIP

	Securian Real Estate Securities								Value
(In thousands)	Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19				Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income		$	299			$	503			$	4,242			$	8,776
Net realized gain (loss) on investments			(702	)			2,485				6,202				18,462
Net change in unrealized appreciation (depreciation)			(4,104	)			4,986				(97,361	)			84,726
Net Increase (Decrease) in Net Assets Resulting from Operations			(4,507	)			7,974				(86,917	)			111,964
Distributions to Shareholders From:
Accumulated earnings:
(combined net investment income and net realized gains)
Class II			(2,884	)			(744	)			(26,609	)			(30,616	)
Total Distributions to Shareholders			(2,884	)			(744	)			(26,609	)			(30,616	)
Capital Share Transactions			955				(6,032	)			(1,593	)			(16,326	)
Net Increase (Decrease) in Net Assets			(6,436	)			1,198				(115,119	)			65,022
Net Assets, Beginning of Period			35,461				34,263				510,877				445,855
Net Assets, End of Period		$	29,025			$	35,461			$	395,758			$	510,877

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 43

FINANCIAL HIGHLIGHTS IVY VIP

FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD

	Net Asset Value, Beginning of Period			Net Investment Income(1)			Net Realized and Unrealized Gain (Loss) on Investments				Total from Investment Operations				Distributions From Net Investment Income				Distributions From Net Realized Gains				Total Distributions
Core Equity
Class II Shares
Six-month period ended 6-30-2020 (unaudited)		$	12.63		$	0.04		$	(0.23	)		$	(0.19	)		$	(0.07	)		$	(0.70	)		$	(0.77	)
Year ended 12-31-2019			10.80			0.06			3.10				3.16				(0.07	)			(1.26	)			(1.33	)
Year ended 12-31-2018			12.30			0.07			(0.53	)			(0.46	)			(0.06	)			(0.98	)			(1.04	)
Year ended 12-31-2017			10.67			0.05			2.09				2.14				(0.05	)			(0.46	)			(0.51	)
Year ended 12-31-2016			11.75			0.05			0.32				0.37				(0.05	)			(1.40	)			(1.45	)
Year ended 12-31-2015			14.18			0.05			(0.06	)			(0.01	)			(0.05	)			(2.37	)			(2.42	)
Corporate Bond
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			5.60			0.07			0.28				0.35				(0.15	)			—				(0.15	)
Year ended 12-31-2019			5.13			0.15			0.47				0.62				(0.15	)			—				(0.15	)
Year ended 12-31-2018			5.35			0.14			(0.24	)			(0.10	)			(0.11	)			(0.01	)			(0.12	)
Year ended 12-31-2017			5.27			0.12			0.08				0.20				(0.08	)			(0.04	)			(0.12	)
Year ended 12-31-2016			5.20			0.12			0.09				0.21				(0.13	)			(0.01	)			(0.14	)
Year ended 12-31-2015			5.34			0.10			(0.09	)			0.01				(0.15	)			—				(0.15	)
Global Bond
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			5.07			0.09			(0.02	)			0.07				(0.20	)			—				(0.20	)
Year ended 12-31-2019			4.81			0.20			0.24				0.44				(0.18	)			—				(0.18	)
Year ended 12-31-2018			4.96			0.17			(0.18	)			(0.01	)			(0.14	)			—				(0.14	)
Year ended 12-31-2017			4.89			0.15			0.06				0.21				(0.14	)			—				(0.14	)
Year ended 12-31-2016			4.74			0.16			0.17				0.33				(0.18	)			—				(0.18	)
Year ended 12-31-2015			5.05			0.19			(0.31	)			(0.12	)			(0.19	)			—				(0.19	)
Global Equity Income
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			6.01			0.07			(0.90	)			(0.83	)			(0.14	)			—				(0.14	)
Year ended 12-31-2019			6.89			0.16			1.17				1.33				(0.22	)			(1.99	)			(2.21	)
Year ended 12-31-2018			8.58			0.16			(1.07	)			(0.91	)			(0.14	)			(0.64	)			(0.78	)
Year ended 12-31-2017			7.79			0.13			1.03				1.16				(0.10	)			(0.27	)			(0.37	)
Year ended 12-31-2016			7.82			0.11			0.40				0.51				(0.10	)			(0.44	)			(0.54	)
Year ended 12-31-2015			9.05			0.09			(0.23	)			(0.14	)			(0.11	)			(0.98	)			(1.09	)

(1) Based on average weekly shares outstanding.

(2) Based on net asset value. Total returns do not reflect a sales charge or contingent sales charge, if applicable. Total returns for periods less than one year are not annualized.

(3) Ratios excluding expense waivers are included only for periods in which the class had waived or reimbursed expenses.

(4) Annualized.

    .

44 SEMIANNUAL REPORT 2020

	Net Asset Value, End of Period			Total Return(2)			Net Assets, End of Period (in millions)			Ratio of Expenses to Average Net Assets Including Expense Waiver			Ratio of Net Investment Income to Average Net Assets Including Expense Waiver			Ratio of Expenses to Average Net Assets Excluding Expense Waiver(3)			Ratio of Net Investment Income to Average Net Assets Excluding Expense Waiver(3)			Portfolio Turnover Rate
Core Equity
Class II Shares
Six-month period ended 6-30-2020 (unaudited)		$	11.67		-1.24	%		$	659		0.95	%(4)		0.64	%(4)		1.01	%(4)		0.58	%(4)		32	%
Year ended 12-31-2019			12.63		31.09				723		0.95			0.53			1.00			0.48			80
Year ended 12-31-2018			10.80		-4.51				626		0.95			0.59			1.00			0.54			99
Year ended 12-31-2017			12.30		20.75				445		0.95			0.42			1.00			0.37			78
Year ended 12-31-2016			10.67		3.74				420		0.95			0.45			1.01			0.39			75
Year ended 12-31-2015			11.75		-0.69				454		0.95			0.38			1.00			0.33			60
Corporate Bond
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			5.80		6.43				628		0.78	(4)		2.56	(4)		—			—			60
Year ended 12-31-2019			5.60		12.18				600		0.77			2.73			—			—			66
Year ended 12-31-2018			5.13		-1.90				544		0.77			2.77			—			—			63
Year ended 12-31-2017			5.35		4.01				548		0.78			2.32			—			—			66
Year ended 12-31-2016			5.27		4.03				416		0.79			2.17			—			—			84
Year ended 12-31-2015			5.20		0.20				280		0.78			1.87			—			—			59
Global Bond
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			4.94		1.68				20		0.78	(4)		3.72	(4)		1.41	(4)		3.09	(4)		29
Year ended 12-31-2019			5.07		9.42				21		0.50			3.96			1.13			3.33			43
Year ended 12-31-2018			4.81		-0.18				22		0.50			3.52			1.12			2.90			37
Year ended 12-31-2017			4.96		4.27				23		0.50			3.08			1.12			2.46			49
Year ended 12-31-2016			4.89		7.04				22		0.50			3.28			1.13			2.65			18
Year ended 12-31-2015			4.74		-2.65				20		0.51			3.80			1.14			3.17			26
Global Equity Income
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			5.04		-13.63				285		1.04	(4)		2.71	(4)		—			—			41
Year ended 12-31-2019			6.01		23.15				297		1.02			2.52			—			—			39
Year ended 12-31-2018			6.89		-11.68				284		1.01			2.01			—			—			93
Year ended 12-31-2017			8.58		15.56				527		1.00			1.60			—			—			35
Year ended 12-31-2016			7.79		6.95				509		1.01			1.43			—			—			59
Year ended 12-31-2015			7.82		-2.06				515		1.00			1.14			—			—			50

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 45

FINANCIAL HIGHLIGHTS IVY VIP

FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD

	Net Asset Value, Beginning of Period			Net Investment Income(1)				Net Realized and Unrealized Gain (Loss) on Investments				Total from Investment Operations				Distributions From Net Investment Income				Distributions From Net Realized Gains				Total Distributions
Global Growth
Class II Shares
Six-month period ended 6-30-2020 (unaudited)		$	3.58		$	0.00	*		$	(0.11	)		$	(0.11	)		$	(0.01	)		$	—			$	(0.01	)
Year ended 12-31-2019			8.67			0.02				1.45				1.47				(0.06	)			(6.50	)			(6.56	)
Year ended 12-31-2018			9.87			0.05				(0.58	)			(0.53	)			(0.05	)			(0.62	)			(0.67	)
Year ended 12-31-2017			8.14			0.04				1.93				1.97				—	*			(0.24	)			(0.24	)
Year ended 12-31-2016			8.68			0.01				(0.28	)			(0.27	)			(0.02	)			(0.25	)			(0.27	)
Year ended 12-31-2015			8.84			0.02				0.31				0.33				(0.04	)			(0.45	)			(0.49	)
Limited-Term Bond
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			4.95			0.05				0.09				0.14				(0.14	)			—				(0.14	)
Year ended 12-31-2019			4.84			0.09				0.11				0.20				(0.09	)			—				(0.09	)
Year ended 12-31-2018			4.88			0.09				(0.05	)			0.04				(0.08	)			—				(0.08	)
Year ended 12-31-2017			4.89			0.08				(0.01	)			0.07				(0.08	)			—				(0.08	)
Year ended 12-31-2016			4.87			0.08				0.01				0.09				(0.07	)			—				(0.07	)
Year ended 12-31-2015			4.90			0.06				(0.02	)			0.04				(0.07	)			—				(0.07	)
Securian Real Estate Securities
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			8.05			0.07				(1.19	)			(1.12	)			(0.12	)			(0.57	)			(0.69	)
Year ended 12-31-2019			6.60			0.17				1.43				1.60				(0.12	)			(0.03	)			(0.15	)
Year ended 12-31-2018			7.64			0.10				(0.54	)			(0.44	)			(0.11	)			(0.49	)			(0.60	)
Year ended 12-31-2017			8.40			0.11				0.27				0.38				(0.11	)			(1.03	)			(1.14	)
Year ended 12-31-2016			8.98			0.10				0.25				0.35				(0.10	)			(0.84	)			(0.94	)
Year ended 12-31-2015			9.59			0.10				0.31				0.41				(0.10	)			(0.92	)			(1.02	)
Value
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			6.72			0.06				(1.24	)			(1.18	)			(0.12	)			(0.24	)			(0.36	)
Year ended 12-31-2019			5.69			0.11				1.32				1.43				(0.05	)			(0.35	)			(0.40	)
Year ended 12-31-2018			6.44			0.07				(0.51	)			(0.44	)			(0.12	)			(0.19	)			(0.31	)
Year ended 12-31-2017			5.93			0.11				0.61				0.72				(0.09	)			(0.12	)			(0.21	)
Year ended 12-31-2016			6.15			0.08				0.49				0.57				(0.07	)			(0.72	)			(0.79	)
Year ended 12-31-2015			7.39			0.06				(0.30	)			(0.24	)			(0.06	)			(0.94	)			(1.00	)

* Not shown due to rounding.

(1) Based on average weekly shares outstanding.

(2) Based on net asset value. Total returns do not reflect a sales charge or contingent sales charge, if applicable. Total returns for periods less than one year are not annualized.

(3) Ratios excluding expense waivers are included only for periods in which the class had waived or reimbursed expenses.

(4) Annualized.

    .

46 SEMIANNUAL REPORT 2020

	Net Asset Value, End of Period			Total Return(2)			Net Assets, End of Period (in millions)			Ratio of Expenses to Average Net Assets Including Expense Waiver			Ratio of Net Investment Income to Average Net Assets Including Expense Waiver			Ratio of Expenses to Average Net Assets Excluding Expense Waiver(3)			Ratio of Net Investment Income to Average Net Assets Excluding Expense Waiver(3)			Portfolio Turnover Rate
Global Growth
Class II Shares
Six-month period ended 6-30-2020 (unaudited)		$	3.46		-2.77	%		$	136		1.13	%(4)		0.13	%(4)		1.25	%(4)		0.01	%(4)		21	%
Year ended 12-31-2019			3.58		25.93				148		1.13			0.41			1.21			0.33			26
Year ended 12-31-2018			8.67		-6.27				134		1.13			0.46			1.18			0.41			40
Year ended 12-31-2017			9.87		24.52				424		1.14			0.47			1.17			0.44			54
Year ended 12-31-2016			8.14		-3.04				408		1.13			0.09			1.16			0.06			71
Year ended 12-31-2015			8.68		3.39				507		1.14			0.23			1.17			0.20			54
Limited-Term Bond
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			4.95		2.99				404		0.82	(4)		1.82	(4)		—			—			37
Year ended 12-31-2019			4.95		4.23				453		0.79			1.89			—			—			54
Year ended 12-31-2018			4.84		0.78				542		0.79			1.91			—			—			53
Year ended 12-31-2017			4.88		1.40				443		0.80			1.62			—			—			55
Year ended 12-31-2016			4.89		1.94				395		0.81			1.53			—			—			60
Year ended 12-31-2015			4.87		0.87				385		0.80			1.31			—			—			44
Securian Real Estate Securities
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			6.24		-13.26				29		1.44	(4)		1.98	(4)		1.53	(4)		1.89	(4)		36
Year ended 12-31-2019			8.05		24.43				35		1.26			1.36			1.35			1.27			54
Year ended 12-31-2018			6.60		-5.57				34		1.24			1.45			1.33			1.36			71
Year ended 12-31-2017			7.64		5.39				43		1.22			1.38			1.31			1.29			73
Year ended 12-31-2016			8.39		4.26				49		1.20			1.26			1.29			1.17			79
Year ended 12-31-2015			8.98		4.78				47		1.19			1.10			1.28			1.01			57
Value
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			5.18		-17.44				396		1.01	(4)		1.98	(4)		—			—			29
Year ended 12-31-2019			6.72		26.33				511		1.00			1.81			—			—			62
Year ended 12-31-2018			5.69		-7.24				446		1.00			1.09			—			—			56
Year ended 12-31-2017			6.44		12.49				432		1.00			1.74			—			—			67
Year ended 12-31-2016			5.93		11.14				379		1.02			1.38			1.03			1.37			54
Year ended 12-31-2015			6.15		-3.91				384		0.99			0.91			1.00			0.90			74

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 47

NOTES TO FINANCIAL STATEMENTS IVY VIP

JUNE 30, 2020 (UNAUDITED)

1. ORGANIZATION

Ivy Variable Insurance Portfolios, a Delaware statutory trust (the “Trust”), is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. Core Equity, Corporate Bond, Global Bond, Global Equity Income, Global Growth, Limited-Term Bond, Securian Real Estate Securities and Value (each, a “Portfolio”) are eight series of the Trust and are the only series of the Trust included in these financial statements. The assets belonging to each Portfolio are held separately by the custodian. The investment objective, policies and risk factors of each Portfolio are described more fully in the Prospectus and Statement of Additional Information (“SAI”). Each Portfolio’s investment adviser is Ivy Investment Management Company (“IICO”).

2. SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies consistently followed by each Portfolio.

Security Transactions and Related Investment Income. Security transactions are accounted for on the trade date (date the order to buy or sell is executed). Realized gains and losses are calculated on the identified cost basis. Interest income is recorded on the accrual basis and includes paydown gain (loss) and accretion of discounts and amortization of premiums. Dividend income is recorded on the ex-dividend date, except certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Portfolio is informed of the ex-dividend date. All or a portion of the distributions received from a real estate investment trust or publicly traded partnership may be designated as a reduction of cost of the related investment or realized gain. 

Foreign Currency Translation. Each Portfolio’s accounting records are maintained in U.S. dollars. All assets and liabilities denominated in foreign currencies are translated into U.S. dollars daily, using foreign exchange rates obtained from an independent pricing service approved by the Board of Trustees of the Trust (the “Board”). Purchases and sales of investment securities and accruals of income and expenses are translated at the rate of exchange prevailing on the date of the transaction. For assets and liabilities other than investments in securities, net realized and unrealized gains and losses from foreign currency translation arise from changes in currency exchange rates. Each Portfolio combines fluctuations from currency exchange rates and fluctuations in value when computing net realized gain (loss) and net change in unrealized appreciation (depreciation) on investments. Foreign exchange rates are typically valued as of the close of the New York Stock Exchange (“NYSE”), normally 4:00 P.M. Eastern time, on each day the NYSE is open for trading. 

Dividends and Distributions to Shareholders. Dividends and distributions to shareholders are recorded by each Portfolio on the business day following record date. Net investment income dividends and capital gains distributions are determined in accordance with income tax regulations which may differ from accounting principles generally accepted in the United States of America (“U.S. GAAP”). If the total dividends and distributions made in any tax year exceeds net investment income and accumulated realized capital gains, a portion of the total distribution may be treated as a tax return of capital.

Income Taxes. It is the policy of each Portfolio to distribute all of its taxable income and capital gains to its shareholders and to otherwise qualify as a regulated investment company under Subchapter M of the Internal Revenue Code. In addition, each Portfolio intends to pay distributions as required to avoid imposition of excise tax. Accordingly, no provision has been made for Federal income taxes. The Portfolios file income tax returns in U.S. federal and applicable state jurisdictions. The Portfolios’ tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years after the filing of the tax returns. Management of the Trust periodically reviews all tax positions to assess whether it is more likely than not that the position would be sustained upon examination by the relevant tax authority based on the technical merits of each position. As of the date of these financial statements, management believes that no liability for unrecognized tax positions is required.

Segregation and Collateralization. In cases in which the 1940 Act and the interpretive positions of the Securities and Exchange Commission (“SEC”), the Dodd Frank Wall Street Reform and Consumer Protection Act, or the interpretive rules and regulations of the U.S. Commodities Futures Trading Commission require that a Portfolio either deliver collateral or segregate assets in connection with certain investments (e.g., dollar rolls, financial futures contracts, foreign currency exchange contracts, options written, securities with extended settlement periods, and swaps), the Portfolio will segregate collateral or designate on its books and records, cash or other liquid securities having a value at least equal to the amount that is required to be physically segregated for the benefit of the counterparty. Furthermore, based on requirements and agreements with certain exchanges and third party broker-dealers, each party has requirements to deliver/deposit cash or securities as collateral for certain investments. Certain countries require that cash reserves be held while investing in companies incorporated in that country. These cash reserves and cash collateral that has been pledged to cover obligations of the Portfolios under derivative contracts, if any, will be reported separately on the Statement of Assets and Liabilities as “Restricted cash”. Securities collateral pledged for the same purpose, if any, is noted on the Schedule of Investments. 

Concentration of Market and Credit Risk. In the normal course of business, the Portfolios invest in securities and enter into transactions where risks exist due to fluctuations in the market (market risk) or failure of the issuer of a security to meet

48 SEMIANNUAL REPORT 2020

all its obligations (issuer credit risk). The value of securities held by the Portfolios may decline in response to certain events, including those directly involving the issuers whose securities are owned by the Portfolios; conditions affecting the general economy; overall market changes; local, regional or global political, social or economic instability; and currency and interest rate and price fluctuations. Similar to issuer credit risk, the Portfolios may be exposed to counterparty credit risk, or the risk that an entity with which the Portfolios have unsettled or open transactions may fail to or be unable to perform on its commitments. The Portfolios manage counterparty credit risk by entering into transactions only with counterparties that they believe have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties. Financial assets, which potentially expose the Portfolios to market, issuer and counterparty credit risks, consist principally of financial instruments and receivables due from counterparties. The extent of the Portfolios’ exposure to market, issuer and counterparty credit risks with respect to these financial assets is generally approximated by their value recorded on the Portfolios’ Statement of Assets and Liabilities, less any collateral held by the Portfolios.

Certain Portfolios may hold high-yield or non-investment-grade bonds, that may be subject to a greater degree of credit risk. Credit risk relates to the ability of the issuer to meet interest or principal payments or both as they become due. The Portfolios may acquire securities in default and are not obligated to dispose of securities whose issuers subsequently default.

Certain Portfolios may enter into financial instrument transactions (such as swaps, futures, options and other derivatives) that may have off-balance sheet market risk. Off-balance sheet market risk exists when the maximum potential loss on a particular financial instrument is greater than the value of such financial instrument, as reflected on the Statement of Assets and Liabilities.

If a Portfolio invests directly in foreign currencies or in securities that trade in, and receive revenues in, foreign currencies, or in financial derivatives that provide exposure to foreign currencies, it will be subject to the risk that those currencies will decline in value relative to the base currency of the Portfolio, or, in the case of hedging positions, that the Portfolio’s base currency will decline in value relative to the currency being hedged. Currency rates in foreign countries may fluctuate significantly over short periods of time for a number of reasons, including changes in interest rates, intervention (or the failure to intervene) by U.S. or foreign governments, central banks or supranational entities such as the International Monetary Fund, or by the imposition of currency controls or other political developments in the United States or abroad.

The London Interbank Offered Rate “LIBOR” is an indicative measure of the average interest rate at which major global banks could borrow from one another. LIBOR is quoted in multiple currencies and multiple time frames using data reported by private-sector banks. LIBOR is used extensively in the United States and globally as a “benchmark” or “reference rate” for various commercial and financial contracts, including corporate and municipal bonds and loans, floating rate mortgages, asset-backed securities, consumer loans, and interest rate swaps and other derivatives.

It is expected that a number of private-sector banks currently reporting information used to set LIBOR will stop doing so after 2021 when their current reporting commitment ends, which could either cause LIBOR to stop publication immediately or cause LIBOR’s regulator to determine that its quality has degraded to the degree that it is no longer representative of its underlying market.

Management believes that, with respect to any significant investments by a Portfolio in instruments linked to LIBOR, the impact on investments and discontinuation of LIBOR may represent a significant risk.

However, management acknowledges that the anticipated transition away from LIBOR will occur after 2021 and certain of the current investments will mature prior to that time. Furthermore, the ways in which LIBOR’s discontinuation potentially could impact the Portfolios’ investments is not fully known. The extent of that impact may vary depending on various factors, which include, but are not limited to: (i) existing fallback or termination provisions in individual contracts and (ii) whether, how, and when industry participants develop and adopt new successor reference rates and/or fallbacks for both legacy and new instruments.

In addition, the transition to a successor rate could potentially cause (i) increased volatility or illiquidity in markets for instruments that currently rely on LIBOR, (ii) a reduction in the value of certain instruments held by a Portfolio, or (iii) reduced effectiveness of related Portfolio transactions, such as hedging.

As the impacts of the transition become clearer during the next year, Management will be evaluating the impacts of these changes.

An outbreak of infectious respiratory illness caused by a novel coronavirus known as COVID-19 was first detected in China in December 2019 and has now been detected globally. This coronavirus has resulted in travel restrictions, closed international borders, enhanced health screenings at ports of entry and elsewhere, disruption of and delays in healthcare service preparation and delivery, prolonged quarantines, cancellations, supply chain disruptions, and lower consumer demand, as well as general concern and uncertainty. The impact of COVID-19, and other infectious illness outbreaks that may arise in the future, could adversely affect the economies of many nations or the entire global economy, individual issuers and capital markets in ways that cannot necessarily be foreseen. In addition, the impact of infectious illnesses in

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emerging market countries may be greater due to generally less established healthcare systems. Public health crises caused by the COVID-19 outbreak may exacerbate other pre-existing political, social and economic risks in certain countries or globally. The duration of the COVID-19 outbreak and its effects cannot be determined with certainty.

The individual Portfolios herein have adopted a Liquidity Risk Management Program (the “Program”). The Portfolio’s board has designated a Liquidity Risk Management Committee (the “Committee”) as the administrator of the Program. The Committee or delegates of the Committee conduct the day-to-day operation of the Program. Under the Program, the Committee manages the Portfolio’s liquidity risk, which is the risk that any Portfolio could not meet shareholder redemption requests without significant dilution of remaining shareholders’ interests in the Portfolio. This risk is managed by monitoring the degree of liquidity of the Portfolio’s investments, limiting the amount of the Portfolio’s illiquid investments, and utilizing various risk management tools and facilities available to the Portfolio for meeting shareholder redemptions, among other means. The Committee’s process of determining the degree of liquidity of the Portfolio’s investments is supported by one or more third-party liquidity assessment vendors. The Portfolio’s board reviewed a report prepared by a designee of the Committee regarding the operation, adequacy and effectiveness of the Program from the period June 1, 2019, through March 31, 2020. The report described the Program’s liquidity classification methodology and the methodology in establishing a Portfolio’s Highly Liquid Investment Minimum (“HLIM”), if necessary. The Committee reported that during the period covered by the report, there were no material changes to the Program and no significant liquidity events impacting the Portfolio or its ability to timely meet redemptions without dilution to existing shareholders. In addition, the Committee provided its assessment that the Program, including the operation of each Portfolio’s HLIM, where applicable, had been effective in managing the Portfolio’s liquidity risk.

Inflation-Indexed Bonds. Certain Portfolios may invest in inflation-indexed bonds. Inflation-indexed bonds are fixed-income securities whose principal value is periodically adjusted to the rate of inflation. The interest rate on these bonds is generally fixed at issuance at a rate lower than typical bonds. Over the life of an inflation-indexed bond, however, interest will be paid based on a principal value, which is adjusted for inflation. Any increase or decrease in the principal amount of an inflation-indexed bond will be included as interest income on the Statement of Operations, even though investors do not receive their principal until maturity.

Interest Only Obligations. These securities entitle the owner to receive only the interest portion from a bond, Treasury note or pool of mortgages. These securities are generally created by a third party separating a bond or pool of mortgages into distinct interest-only and principal-only securities. As the principal (par) amount of a bond or pool of mortgages is paid down, the amount of interest income earned by the owner will decline as well.

Loans. Certain Portfolios may invest in loans, the interest rates of which float or adjust periodically based upon a specified adjustment schedule, benchmark indicator, or prevailing interest rates, the debtor of which may be a domestic or foreign corporation, partnership or other entity (“Borrower”). Loans generally pay interest at rates which are periodically redetermined by reference to a base lending rate plus a premium. These base lending rates generally include prime rates of one or more major U.S. banks, the LIBOR or certificates of deposit rates. Loans often require prepayments from excess cash flow or permit the Borrower to repay at its election. The degree to which Borrowers repay cannot be predicted with accuracy. As a result, the actual maturity may be substantially less than the stated maturities. Loans are exempt from registration under the Securities Act of 1933, as amended, may contain certain restrictions on resale, and cannot be sold publicly. A Portfolio’s investments in loans may be in the form of participations in loans or assignments of all or a portion of loans from third parties.

When a Portfolio purchases assignments, it acquires all the rights and obligations under the loan agreement of the assigning lender. Assignments may, however, be arranged through private negotiations between potential assignees and potential assignors, and the rights and obligations acquired by the purchaser of an assignment may differ from, and be more limited than those held by the assigning lender. When a Portfolio purchases a participation of a loan interest, the Portfolio typically enters into a contractual agreement with the lender or other third party selling the participation. A participation interest in loans includes the right to receive payments of principal, interest and any fees to which it is entitled from the lender and only upon receipt by the lender of payments from the Borrower, but not from the Borrower directly. When investing in a participation interest, if a Borrower is unable to meet its obligations under a loan agreement, a Portfolio generally has no direct right to enforce compliance with the terms of the loan agreement. As a result, the Portfolio assumes the credit risk of the Borrower, the selling participant, and any other persons that are interpositioned between the Portfolio and the Borrower. If the lead lender in a typical lending syndicate becomes insolvent, enters Federal Deposit Insurance Corporation (“FDIC”) receivership or, if not FDIC insured, enters into bankruptcy, the Portfolio may incur certain costs and delays in receiving payment or may suffer a loss of principal and interest.

Payment In-Kind Securities. Certain Portfolios may invest in payment in-kind securities (“PIKs”). PIKs give the issuer the option at each interest payment date of making interest payments in cash or in additional debt securities. Those additional debt securities usually have the same terms, including maturity dates and interest rates, and associated risks as the original bonds. The daily market quotations of the original bonds may include the accrued interest (referred to as a dirty price) and

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require a pro-rata adjustment from the unrealized appreciation or depreciation on investments to interest receivable on the Statement of Assets and Liabilities.

Securities on a When-Issued or Delayed Delivery Basis. Certain Portfolios may purchase securities on a “when-issued” basis, and may purchase or sell securities on a “delayed delivery” basis. “When-issued” or “delayed delivery” refers to securities whose terms and indenture are available and for which a market exists, but which are not available for immediate delivery. Delivery and payment for securities that have been purchased by a Portfolio on a when-issued basis normally take place within six months and possibly as long as two years or more after the trade date. During this period, such securities do not earn interest, are subject to market fluctuation and may increase or decrease in value prior to their delivery. The purchase of securities on a when-issued basis may increase the volatility of a Portfolio’s NAV to the extent the Portfolio executes such transactions while remaining substantially fully invested. When a Portfolio engages in when-issued or delayed delivery transactions, it relies on the buyer or seller, as the case may be, to complete the transaction. Their failure to do so may cause the Portfolio to lose the opportunity to obtain or dispose of the security at a price and yield IICO, or the Portfolio’s investment subadviser, as applicable, consider advantageous. The Portfolio maintains internally designated assets with a value equal to or greater than the amount of its purchase commitments. The Portfolio may also sell securities that it purchased on a when-issued or delayed delivery basis prior to settlement of the original purchase. 

Custodian Fees. “Custodian fees” on the Statement of Operations may include interest expense incurred by a Portfolio on any cash overdrafts of its custodian account during the period. Such cash overdrafts may result from the effects of failed trades in portfolio securities and from cash outflows resulting from unanticipated shareholder redemption activity. A Portfolio pays interest to its custodian on such cash overdrafts, to the extent they are not offset by positive cash balances maintained by that Portfolio. The “Earnings credit” line item, if shown, represents earnings on cash balances maintained by that Portfolio during the period. Such interest expense and other custodian fees may be paid with these earnings. 

Indemnification. The Trust’s organizational documents provide current and former Trustees and Officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Trust. In the normal course of business, the Trust may also enter into contracts that provide general indemnification. The Trust’s maximum exposure under these arrangements is unknown and is dependent on future claims that may be made against the Trust. The risk of material loss from such claims is considered remote. 

Basis of Preparation. Each Portfolio is an investment company and follows accounting and reporting guidance in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Topic 946 (“ASC 946”). The accompanying financial statements were prepared in accordance with U.S. GAAP, including but not limited to ASC 946. U.S. GAAP requires the use of estimates made by management. Management believes that estimates and valuations are appropriate; however, actual results may differ from those estimates, and the valuations reflected in the accompanying financial statements may differ from the value ultimately realized upon sale or maturity.

Subsequent Events. Management has performed a review for subsequent events through the date this report was issued.

3. INVESTMENT VALUATION AND FAIR VALUE MEASUREMENTS

Each Portfolio’s investments are reported at fair value. Fair value is defined as the price that each Portfolio would receive upon selling an asset or would pay upon satisfying a liability in an orderly transaction between market participants at the measurement date. Each Portfolio calculates the NAV of its shares as of the close of the NYSE, normally 4:00 P.M. Eastern time, on each day the NYSE is open for trading.

For purposes of calculating the NAV, the portfolio securities and financial instruments are valued on each business day using pricing and valuation methods as adopted by the Board. Where market quotes are readily available, fair value is generally determined on the basis of the last reported sales price, or if no sales are reported, based on quotes obtained from a quotation reporting system, established market makers, or pricing services.

Prices for fixed-income securities are typically based on quotes that are obtained from an independent pricing service approved by the Board. To determine values of fixed-income securities, the independent pricing service utilizes such factors as current quotations by broker/dealers, coupon, maturity, quality, type of issue, trading characteristics, and other yield and risk factors it deems relevant in determining valuations. Securities that cannot be valued by the independent pricing service may be valued using quotes obtained from dealers that make markets in the securities.

Short-term securities with maturities of 60 days or less are valued based on quotes that are obtained from an independent pricing service approved by the Board as described in the preceding paragraph above.

Because many foreign markets close before the NYSE, events may occur between the close of the foreign market and the close of the NYSE that could have a material impact on the valuation of foreign securities. Waddell & Reed Services Company (“WRSCO”), pursuant to procedures adopted by the Board, evaluates the impact of these events and may adjust the valuation of foreign securities to reflect the fair value as of the close of the NYSE. In addition, all securities for which values are not readily available or are deemed unreliable are appraised at fair value as determined in good faith under the supervision of the Board.

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Where market quotes are not readily available, portfolio securities or financial instruments are valued at fair value, as determined in good faith by the Board or Valuation Committee pursuant to procedures approved by the Board.

Market quotes are considered not readily available in circumstances where there is an absence of current or reliable market-based data (e.g., trade information or broker quotes), including where events occur after the close of the relevant market, but prior to the NYSE close, that materially affect the values of a Portfolio’s securities or financial instruments. In addition, market quotes are considered not readily available when, due to extraordinary circumstances, the exchanges or markets on which the securities trade do not open for trading for the entire day and no other market prices are available.

The Board has delegated to WRSCO the responsibility for monitoring significant events that may materially affect the values of a Portfolio’s securities or financial instruments and for determining whether the value of the applicable securities or financial instruments should be re-evaluated in light of such significant events. IICO, pursuant to authority delegated by the Board, has established a Valuation Committee to administer and oversee the valuation process, including the use of third party pricing vendors.

The Board has adopted methods for valuing securities and financial instruments in circumstances where market quotes are not readily available. For instances in which daily market quotes are not readily available, investments may be valued, pursuant to procedures established by the Board, with reference to other securities or indices. In the event that the security or financial instrument cannot be valued pursuant to one of the valuation methods established by the Board, the value of the security or financial instrument will be determined in good faith by the Valuation Committee in accordance with the procedures adopted by the Board.

When a Portfolio uses these fair valuation methods applied by WRSCO that use significant unobservable inputs to determine its NAV, securities will be priced by a method that the Board or persons acting at its direction believe accurately reflects fair value and are categorized as Level 3 of the fair value hierarchy. These methods may require subjective determinations about the value of a security. The prices used by a Portfolio may differ from the value that will ultimately be realized at the time the securities are sold.

WRSCO is responsible for monitoring the implementation of the pricing and valuation policies through a series of activities to provide reasonable comfort of the accuracy of prices including: 1) periodic vendor due diligence meetings to review methodologies, new developments, and process at vendors, 2) daily and monthly multi-source pricing comparisons reviewed and submitted to the Valuation Committee, and 3) daily review of unpriced, stale, and variance reports with exceptions reviewed by management and the Valuation Committee.

Accounting standards establish a framework for measuring fair value and a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability. Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the reporting entity’s own assumptions about the factors that market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.

An individual investment’s fair value measurement is assigned a level based upon the observability of the inputs which are significant to the overall valuation.

The three-tier hierarchy of inputs is summarized as follows:

• Level 1 – Observable inputs such as quoted prices, available in active markets, for identical assets or liabilities.

• Level 2 – Significant other observable inputs, which may include, but are not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market corroborated inputs.

• Level 3 – Significant unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available, which may include assumptions made by the Board or persons acting at its direction that are used in determining the fair value of investments.

A description of the valuation techniques applied to the Portfolios’ major classes of assets and liabilities measured at fair value on a recurring basis follows:

Asset-Backed Securities and Mortgage-Backed Securities. The fair value of asset-backed securities and mortgage-backed securities are estimated using recently executed transactions and based on models that consider the estimated cash flows of each debt tranche of the issuer, establish a benchmark yield, and develop an estimated tranche specific spread to the benchmark yield based on the unique attributes of the tranche including, but not limited to, the prepayment speed assumptions and attributes of the collateral. To the extent the inputs are observable and timely, the values would be categorized in Level 2 of the fair value hierarchy, and otherwise they would be categorized as Level 3.

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Corporate Bonds. The fair value of corporate bonds, as obtained from an independent pricing service, is estimated using various techniques, which consider recently executed transactions in securities of the issuer or comparable issuers, market price quotations (where observable), bond spreads, fundamental data relating to the issuer, and credit default swap spreads adjusted for any basis difference between cash and derivative instruments. While most corporate bonds are categorized in Level 2 of the fair value hierarchy, in instances where lower relative weight is placed on transaction prices, quotations, or similar observable inputs, they are categorized in Level 3 of the fair value hierarchy.

Derivative Instruments. Forward foreign currency contracts are valued based upon the closing prices of the forward currency rates determined at the close of the NYSE, which are provided by an independent pricing service. Swaps derive their value from underlying asset prices, indices, reference rates and other inputs or a combination of these factors. Swaps are valued by an independent pricing service unless the price is unavailable, in which case they are valued at the price provided by a dealer in that security. Exchange-traded futures contracts are generally valued at the settlement price. Listed options are ordinarily valued at the mean of the last bid and ask price provided by an independent pricing service unless the price is unavailable, in which case they are valued at a quotation obtained from a broker-dealer. Over the counter (“OTC”) options are ordinarily valued at the mean of the last bid and ask price for a comparable listed option provided by an independent pricing service unless such a price is unavailable, in which case they are valued at a quotation obtained from a broker-dealer.

Listed derivatives that are actively traded are valued based on quoted prices from the exchange and are categorized in Level 1 of the fair value hierarchy. OTC derivative contracts include forward foreign currency contracts, swap agreements, and option contracts related to interest rates, foreign currencies, credit standing of reference entities, equity prices, or commodity prices. Depending on the product and the terms of the transaction, the fair value of the OTC derivative products are modeled taking into account the counterparties’ creditworthiness and using a series of techniques, including simulation models. Many pricing models do not entail material subjectivity because the methodologies employed do not necessitate significant judgments and the pricing inputs are observed from actively quoted markets, as is the case with interest rate swap and option contracts. OTC derivative products valued using pricing models with significant observable inputs are categorized within Level 2 of the fair value hierarchy.

Equity Securities. Equity securities traded on U.S. or foreign securities exchanges or included in a national market system are valued at the official closing price at the close of each business day unless otherwise stated below. OTC equity securities and listed securities for which no price is readily available are valued at the average of the last bid and ask prices.

Mutual funds, including investment funds, typically are valued at the NAV reported as of the valuation date.

Securities that are stated at the last reported sales price or closing price on the day of valuation taken from the primary exchange where the security is principally traded and to the extent these securities are actively traded and valuation adjustments are not applied, they are categorized in Level 1 of the fair value hierarchy.

Foreign securities, for which the primary trading market closes at the same time or after the NYSE, are valued based on quotations from the primary market in which they are traded and categorized in Level 1. Because many foreign securities markets and exchanges close prior to the close of the NYSE, closing prices for foreign securities in those markets or on those exchanges do not reflect the events that occur after that close. Certain foreign securities may be fair valued using a pricing service that considers the correlation of the trading patterns of the foreign security to the intra-day trading in the U.S. markets for investments such as American Depositary Receipts, financial futures, exchange-traded funds, and the movement of certain indices of securities based on a statistical analysis of their historical relationship; such valuations generally are categorized in Level 2.

Preferred stock, repurchase agreements, and other equities traded on inactive markets or valued by reference to similar instruments are also generally categorized in Level 2.

Loans. Loans are valued using a price or composite price from one or more brokers or dealers as obtained from an independent pricing service. The fair value of loans is estimated using recently executed transactions, market price quotations, credit/market events, and cross-asset pricing. Inputs are generally observable market inputs obtained from independent sources. Loans are generally categorized in Level 2 of the fair value hierarchy, unless key inputs are unobservable in which case they would be categorized as Level 3.

Municipal Bonds. Municipal bonds are fair valued based on pricing models used by and obtained from an independent pricing service that take into account, among other factors, information received from market makers and broker-dealers, current trades, bid-wants lists, offerings, market movements, the callability of the bond, state of issuance, benchmark yield curves, and bond insurance. To the extent that these inputs are observable and timely, the fair values of municipal bonds would be categorized as Level 2; otherwise the fair values would be categorized as Level 3.

Overdraft due to custodian. Due to the short-term nature of overdraft due to custodian, the carrying value approximates fair value and the liability is categorized as Level 2 in the fair value hierarchy.

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Restricted Securities. Restricted securities that are deemed to be Rule 144A securities and illiquid, as well as restricted securities held in non-public entities, are included in Level 3 of the fair value hierarchy to the extent that significant inputs to valuation are unobservable, because they trade infrequently, if at all and, therefore, the inputs are unobservable. Restricted securities that are valued at a discount to similar publicly traded securities may be categorized as Level 2 of the fair value hierarchy to the extent that the discount is considered to be insignificant to the fair value measurement in its entirety; otherwise they may be categorized as Level 3.

U.S. Government and Agency Securities. U.S. government and agency securities are normally valued using a model that incorporates market observable data such as reported sales of similar securities, broker quotes, yields, bids, offers, quoted market prices, and reference data. Accordingly, U.S. government and agency securities are normally categorized in Level 2 of the fair value hierarchy depending on the liquidity and transparency of the market.

Transfers from Level 2 to Level 3 occurred primarily due to the lack of observable market data due to decreased market activity or information for these securities. Transfers from Level 3 to Level 2 occurred primarily due to the increased availability of observable market data due to increased market activity or information.

For fair valuations using unobservable inputs, U.S. GAAP requires a reconciliation of the beginning to ending balances for reported fair values that presents changes attributable to total realized and unrealized gains or losses, purchases and sales, and transfers in or out of the Level 3 category during the period. In accordance with the requirements of U.S. GAAP, a fair value hierarchy and Level 3 reconciliation, if any, have been included in the Notes to the Schedule of Investments for each respective Portfolio.

Net realized gain (loss) and net unrealized appreciation (depreciation), shown on the reconciliation of Level 3 investments, if applicable, are included on the Statement of Operations in net realized gain (loss) on investments in unaffiliated and/or affiliated securities and in net change in unrealized appreciation (depreciation) on investments in unaffiliated and/or affiliated securities, respectively.

4. DERIVATIVE INSTRUMENTS ($ amounts in thousands unless indicated otherwise)

The following disclosures contain information on why and how the Portfolios use derivative instruments, the associated risks of investing in derivative instruments, and how derivative instruments affect the Portfolios’ financial positions and results of operations.

Futures Contracts. Each Portfolio is authorized to engage in buying and selling futures contracts. Upon entering into a futures contract, a Portfolio is required to deposit, in a segregated account, an amount equal to a varying specified percentage of the contract amount. This amount is known as the initial margin. Subsequent amounts, known as variation margin, are paid or received by the Portfolio each day, dependent on the daily fluctuations in the value of the underlying debt security or index. Options on futures contracts may also be purchased or sold by a Portfolio.

Futures contracts are reported on a schedule following the Schedule of Investments. Securities held in collateralized accounts to cover initial margin requirements on open futures contracts are identified on the Schedule of Investments. Cash held by the broker to cover initial margin requirements on open futures contracts and the receivable and/or payable for the daily mark to market for the variation margin are noted on the Statement of Assets and Liabilities. The net change in unrealized appreciation (depreciation) is reported on the Statement of Operations. Realized gains (losses) are reported on the Statement of Operations at the closing or expiration of futures contracts.

Risks of entering into futures contracts include the possibility of loss of securities or cash held as collateral, that there may be an illiquid market where the Portfolio is unable to close the contract or enter into an offsetting position and, if used for hedging purposes, the risk that the price of the contract will correlate imperfectly with the prices of the Portfolio’s securities.

Corporate Bond invests in short positions in futures contracts to gain exposure to, or economically hedge against, changes in interest rates (interest rate risk).

Option Contracts. Options purchased by a Portfolio are accounted for in the same manner as portfolio securities. The cost of the underlying instruments acquired through the exercise of call options is increased by the premium paid to purchase the call. The proceeds from instruments sold through the exercise of put options are decreased by the premium paid to purchase the put.

When a Portfolio writes (sells) an option, an amount equal to the premium received by the Portfolio is recorded as a liability. The amount of the liability is subsequently adjusted to reflect the current value of the option written. When an option expires on its stipulated expiration date or a Portfolio enters into a closing purchase transaction, the Portfolio realizes a gain (or loss if the cost of a closing purchase transaction exceeds the premium received when the call option was sold), and the liability related to such option is extinguished. When a written call option is exercised, the premium is added to the

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proceeds from the sale of the underlying instrument in determining whether a Portfolio has realized a gain or loss. When a written put is exercised, the cost basis of the instruments purchased by a Portfolio is reduced by the amount of the premium received.

Investments in options, whether purchased or written, involve certain risks. Writing put options and purchasing call options may increase a Portfolio’s exposure to the underlying instrument. With written options, there may be times when a Portfolio will be required to purchase or sell instruments to meet its obligation under the option contract where the required action is not beneficial to the Portfolio, due to unfavorable movement of the market price of the underlying instrument.

Option contracts can be traded on a regulated exchange or traded OTC. Unlike the trades on a regulated exchange where the clearinghouse guarantees the performances of both the buyer and the seller, to the extent a Portfolio enters into OTC option transactions with counterparties, the Portfolio will be exposed to the risk that counterparties to these OTC transactions will be unable to meet their obligations under the terms of the transaction.

Value writes call and put options to increase or decrease hedging exposure to underlying instruments (which include equity risk), increase exposure to various equity markets or certain sectors, gain exposure to or facilitate trading in certain securities and/or, in the case of options written, to generate returns from options premiums.

Collateral and rights of offset. A Portfolio mitigates credit risk with respect to OTC derivative counterparties through credit support annexes (“CSA”) included with an International Swaps and Derivatives Association, Inc. (“ISDA”) Master Agreement which is the standard contract governing all OTC derivative transactions between the Portfolio and each of its counterparties. Although it is not possible to eliminate credit risk entirely, the CSA allows the Portfolio and its counterparty to reduce their exposure to the risk of payment default by the other party by holding an amount in collateral equivalent to the realized and unrealized amount of exposure to the counterparty, which is generally held by the Portfolio’s custodian. An amount of collateral is moved to/from applicable counterparties only if the amount of collateral required to be posted surpasses both the threshold and the minimum transfer amount pre-agreed in the CSA between the Portfolio and the counterparty. See Note 2 “Segregation and Collateralization” for additional information with respect to collateral practices.

Offsetting of Assets and Liabilities. The following tables present financial instruments that are either (1) offset or (2) subject to an enforceable master netting arrangement or similar agreement as of June 30, 2020:

Liabilities

							Gross Amounts Not Offset on the Statement of Assets and Liabilities
Portfolio	Gross Amounts of Recognized Liabilities		Gross Amounts Offset on the Statement of Assets and Liabilities		Net Amounts of Liabilities Presented on the Statement of Assets and Liabilities		Financial Instruments and Derivatives Available for Offset		Non-Cash Collateral Pledged			Cash Collateral Pledged		Net Amount Payable
Value
Written options at value	$	2,493	$	—	$	2,493	$	—	$	(2,493	)	$	—	$	—

Additional Disclosure Related to Derivative Instruments

Fair values of derivative instruments as of June 30, 2020:

		Assets			Liabilities
Portfolio	Type of Risk Exposure	Statement of Assets & Liabilities Location	Value		Statement of Assets & Liabilities Location	Value
Corporate Bond	Interest Rate		$	—	Unrealized depreciation on futures contracts*	$	19
Value	Equity			—	Written options at value	$	3,840

* The value presented includes cumulative gain (loss) on open futures contracts; however, the value reflected on the accompanying Statement of Assets and Liabilities is only the unsettled variation margin receivable (payable) as of June 30, 2020.

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Amount of realized gain (loss) on derivatives recognized on the Statement of Operations for the period ended June 30, 2020:

		Net realized gain (loss) on:
Portfolio	Type of Risk Exposure	Investments in unaffiliated securities*		Swap agreements		Futures contracts			Written options			Forward foreign currency contracts		Total
Corporate Bond	Interest rate	$	—	$	—	$	(746	)	$	—		$	—	$	(746	)
Value	Equity		—		—		—			(2,268	)		—		(2,268	)

* Purchased options are reported as investments in unaffiliated securities and are reflected on the accompanying Schedule of Investments.

Change in unrealized appreciation (depreciation) on derivatives recognized on the Statement of Operations for the period ended June 30, 2020:

		Net change in unrealized appreciation (depreciation) on:
Portfolio	Type of Risk Exposure	Investments in unaffiliated securities*		Swap agreements		Futures contracts			Written options			Forward foreign currency contracts		Total
Corporate Bond	Interest rate	$	—	$	—	$	(19	)	$	—		$	—	$	(19	)
Value	Equity		—		—		—			(769	)		—		(769	)

* Purchased options are reported as investments in unaffiliated securities and are reflected on the accompanying Schedule of Investments.

During the period ended June 30, 2020, the average derivative volume was as follows:

Portfolio	Forward foreign currency contracts(1)	Long futures contracts(2)			Short futures contracts(2)			Swap agreements(3)			Purchased options(2)			Written options(2)
Corporate Bond	$—		$	—		$	11,819		$	—		$	—		$	—
Value	—			—			—			—			—			2,162

(1) Average absolute value of unrealized appreciation/depreciation during the period.

(2) Average value outstanding during the period.

(3) Average notional amount outstanding during the period.

5. INVESTMENT MANAGEMENT AND PAYMENTS TO AFFILIATED PERSONS ($ amounts in thousands unless indicated otherwise)

Management Fees. IICO serves as each Portfolio’s investment adviser. The management fee is accrued daily by each Portfolio at the following annual rates as a percentage of average daily net assets:

Portfolio (M - Millions)	$0 to $500M			$500 to $1,000M			$1,000 to $1,500M			$1,500 to $2,000M			$2,000 to $3,000M			Over $3,000M
Core Equity		0.700	%		0.700	%		0.650	%		0.650	%		0.600	%		0.550	%
Corporate Bond		0.475			0.475			0.450			0.400			0.400			0.400
Global Bond		0.625			0.600			0.550			0.500			0.500			0.500
Global Equity Income		0.700			0.700			0.650			0.650			0.600			0.550
Global Growth		0.850			0.850			0.830			0.830			0.800			0.760
Limited-Term Bond		0.500			0.450			0.400			0.350			0.350			0.350
Securian Real Estate Securities		0.900			0.900			0.870			0.870			0.840			0.800
Value		0.700			0.700			0.650			0.650			0.600			0.550

IICO has voluntarily agreed to waive a Portfolio’s investment management fee on any Portfolio that is not subadvised on any day that the Portfolio’s net assets are less than $25 million, subject to IICO’s right to change or modify this waiver. See Expense Reimbursements and/or Waivers for more information.

IICO has entered into a Subadvisory Agreement with the following entity on behalf of Securian Real Estate Securities:

Securian Asset Management, Inc. (“Securian”) serves as subadvisor to Securian Real Estate Securities. The subadvisor makes investment decisions in accordance with the Portfolio’s investment objectives, policies and restrictions under the supervision of IICO and the Board of Trustees. IICO pays all applicable costs of the subadvisor.

Independent Trustees and Chief Compliance Officer Fees. Fees paid to the Independent Trustees can be paid in cash or deferred to a later date, at the election of the Trustees according to the Deferred Fee Agreement entered into between the

56 SEMIANNUAL REPORT 2020

Trust and the Trustee(s). Each Portfolio records its portion of the deferred fees as a liability on the Statement of Assets and Liabilities. All fees paid in cash plus any appreciation (depreciation) in the underlying deferred plan are shown on the Statement of Operations. Additionally, fees paid to the Chief Compliance Officer of the Portfolios are shown on the Statement of Operations.

Accounting Services Fees. The Trust has an Accounting and Administrative Services Agreement with Waddell & Reed Services Company (“WRSCO”), doing business as WI Services Company (“WISC”). Under the agreement, WISC acts as the agent in providing bookkeeping and accounting services and assistance to the Trust, including maintenance of Portfolio records, pricing of Portfolio shares and preparation of certain shareholder reports. For these services, each Portfolio pays WISC a monthly fee of one-twelfth of the annual fee based on the average net asset levels shown in the following table:

(M - Millions)	$0 to $10M		$10 to $25M		$25 to $50M		$50 to $100M		$100 to $200M		$200 to $350M		$350 to $550M		$550 to $750M		$750 to $1,000M		Over $1,000M
Annual Fee Rate	$	0.00	$	11.50	$	23.10	$	35.50	$	48.40	$	63.20	$	82.50	$	96.30	$	121.60	$	148.50

Each Portfolio also pays WISC a monthly administrative fee at the annual rate of 0.01%, or one basis point, for the first $1 billion of net assets with no fee charged for net assets in excess of $1 billion. This fee is voluntarily waived by WISC until a Portfolio’s net assets are at least $10 million and is included in “Accounting services fee” on the Statement of Operations.

Shareholder Servicing. Under the Transfer Agency Agreement between the Trust and WISC, each Portfolio reimburses WISC for certain out-of-pocket costs.

Service Plan. Class II. Under a Service Plan adopted by the Trust pursuant to Rule 12b–1 under the 1940 Act, each Portfolio may pay a service fee to Ivy Distributors, Inc. (“IDI”) for Class II shares in an amount not to exceed 0.25% of the Portfolio’s average annual net assets. The fee is to be paid to compensate IDI for amounts it expends in connection with the provision of personal services to Policyowners and/or maintenance of Policyowner accounts.

Expense Reimbursements and/or Waivers. IICO, the Portfolios’ investment manager, IDI, the Portfolios’ distributor, and/or Waddell & Reed Services Company, doing business as WISC, the Portfolios’ transfer agent, have contractually agreed to reimburse sufficient management fees, 12b-1 fees and/or shareholder servicing fees to cap the total annual ordinary fund operating expenses (which would exclude interest, taxes, brokerage commissions, acquired fund fees and expenses, and extraordinary expenses, if any). Portfolio and class expense limitations and related waivers/reimbursements for the period ended June 30, 2020 were as follows:

Portfolio Name	Share Class Name	Type of Expense Limit	Commencement Date		End Date		Expense Limit	Amount of Expense Waiver/ Reimbursement			Expense Reduced
Core Equity	Class II	Contractual		10-1-2016		4-30-2021	0.95%	$	169		12b-1 Fees and/or Shareholder Servicing
Global Bond	Class II	Voluntary		N/A		N/A	N/A	$	61	(1)	Investment Management Fee
Global Growth	Class II	Contractual		10-1-2016		4-30-2021	1.13%	$	78		12b-1 Fees and/or Shareholder Servicing
Securian Real Estate Securities	Class II	Contractual		12-3-2012		4-30-2021	N/A	$	14	(2)	Investment Management Fee

(1) For Portfolios managed solely by IICO, IICO has voluntarily agreed to waive its management fee for any day that a portfolio’s net assets are less than $25 million, subject to IICO’s right to change or modify this waiver.

(2) The Portfolio’s investment management fee is being reduced by 0.09% of average daily net assets until April 30, 2021.

Any amounts due to the Portfolios as a reimbursement but not paid as of June 30, 2020 are shown as a receivable from affiliates on the Statement of Assets and Liabilities.

6. INTERFUND LENDING PROGRAM

Pursuant to an exemptive order issued by the SEC (“Order”), the Ivy Funds, Ivy Variable Insurance Portfolios and InvestEd Portfolios (collectively, the “Funds” only for purposes of this footnote 6) have the ability to lend money to, and borrow money from, each other pursuant to a master interfund lending agreement (“Interfund Lending Program”). Under the Interfund Lending Program, the Funds may lend or borrow money for temporary purposes directly to or from one another (each an “Interfund Loan”), subject to meeting the conditions of the Order. The interest rate to be charged on an Interfund Loan is the average of the overnight repurchase agreement rate and the short-term bank loan rate. The Funds made no Interfund Loans under the Interfund Lending Program during the period ended June 30, 2020.

2020 SEMIANNUAL REPORT 57

7. INVESTMENT SECURITIES TRANSACTIONS ($ amounts in thousands)

The cost of purchases and the proceeds from maturities and sales of investment securities (excluding short-term securities) for the period ended June 30, 2020, were as follows:

	Purchases				Sales
	U.S. Government		Other Issuers		U.S. Government		Other Issuers
Core Equity	$	—	$	206,701	$	—	$	254,685
Corporate Bond		—		351,477		—		354,213
Global Bond		453		5,211		2,584		3,895
Global Equity Income		—		141,700		—		109,806
Global Growth		—		27,030		—		30,949
Limited-Term Bond		65,407		82,539		149,393		71,621
Securian Real Estate Securities		—		10,797		—		13,057
Value		—		119,731		—		138,133

8. LOANS OF PORTFOLIO SECURITIES ($ amounts in thousands)

Each Portfolio may lend their portfolio securities only to borrowers that are approved by the Portfolio’s securities lending agent, The Bank of New York Mellon (“BNYM”). The borrower pledges and maintains with the Portfolio collateral consisting of cash or securities issued or guaranteed by the U.S. government. The collateral received by the Portfolio is required to have a value of at least 102% of the market value of the loaned securities for securities traded on U.S. exchanges and a value of at least 105% of the market value for all other securities, except in the case of loans of foreign securities which are denominated and payable in U.S. dollars, in which case the collateral is required to have a value of at least 102% of the market value of the loaned securities. The market value of the loaned securities is determined at the close of each business day and any additional required collateral is delivered to the Portfolio and any excess collateral is returned by the Portfolio on the next business day. During the term of the loan, the Portfolio is entitled to all distributions made on or in respect of the loaned securities but does not receive interest income on securities received as collateral. Loans of securities are terminable at any time and the borrower, after notice, is required to return borrowed securities within the standard time period for settlement of securities transactions.

Cash received as collateral for securities on loan may be reinvested in the Dreyfus Institutional Preferred Government Money Market Fund – Institutional Shares or certain other registered money market funds and are disclosed in the Portfolio’s Schedule of Investments and are reflected in the Statement of Assets and Liabilities as cash collateral on securities loaned at value. Non-cash collateral, in the form of securities issued or guaranteed by the U.S. government or its agencies or instrumentalities, is not disclosed in the Portfolio’s Statement of Assets and Liabilities as it is held by the lending agent on behalf of the Portfolio and the Portfolio does not have the ability to re-hypothecate these securities. The securities on loan for each Portfolio are also disclosed in its Schedule of Investments. The total value of any securities on loan as of June 30, 2020 and the total value of the related cash collateral are disclosed in the Statement of Assets and Liabilities. Income earned by the Portfolios from securities lending activity is disclosed in the Statements of Operations.

The following is a summary of each Portfolio’s securities lending positions and related cash and non-cash collateral received as of June 30, 2020:

Portfolio	Market Value of Securities on Loan		Cash Collateral Received		Non-Cash Collateral Received		Total Collateral Received
Corporate Bond	$	1,838	$	1,671	$	212	$	1,883
Global Bond		115		118		—		118
Global Equity Income		6,582		13,018		—		13,018
Limited-Term Bond		418		419		11		430

The cash collateral received amounts presented in the table above are transactions accounted for as secured borrowings and have an overnight and continuous maturity. The proceeds from the cash collateral received is invested in registered money market funds.

The risks of securities lending include the risk that the borrower may not provide additional collateral when required or may not return the securities when due. To mitigate these risks, the Portfolios benefit from a borrower indemnity provided by BNYM. BNYM’s indemnity allows for full replacement of securities lent wherein BNYM will purchase the unreturned loaned securities on the open market by applying the proceeds of the collateral or to the extent such proceeds are insufficient or the collateral is unavailable, BNYM will purchase the unreturned loan securities at BNYM’s expense. However, the Portfolio could suffer a loss if the value of the investments purchased with cash collateral falls below the value of the cash collateral received.

58 SEMIANNUAL REPORT 2020

9. CAPITAL SHARE TRANSACTIONS (All amounts in thousands)

The Trust has authorized an unlimited number of no par value shares of beneficial interest. Transactions in shares of beneficial interest were as follows:

	Core Equity												Corporate Bond
	Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19						Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19
	Shares			Value			Shares			Value			Shares			Value			Shares			Value
Shares issued from sale of shares:
Class II		2,515		$	26,894			2,145		$	25,198			18,487		$	105,659			15,860		$	87,364
Shares issued in reinvestment of distributions to shareholders:
Class II		3,675			41,267			6,669			73,214			2,715			15,230			2,907			15,235
Shares redeemed:
Class II		(6,976	)		(80,467	)		(9,534	)		(113,019	)		(20,202	)		(112,358	)		(17,580	)		(94,881	)
Net increase (decrease)		(786	)	$	(12,306	)		(720	)	$	(14,607	)		1,000		$	8,531			1,187		$	7,718
	Global Bond												Global Equity Income
	Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19						Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19
	Shares			Value			Shares			Value			Shares			Value			Shares			Value
Shares issued from sale of shares:
Class II		298		$	1,493			750		$	3,702			14,866		$	74,396			861		$	5,716
Shares issued in reinvestment of distributions to shareholders:
Class II		164			784			162			784			1,697			8,016			15,944			85,169
Shares redeemed:
Class II		(550	)		(2,690	)		(1,391	)		(6,892	)		(9,376	)		(46,389	)		(8,600	)		(54,118	)
Net increase (decrease)		(88	)	$	(413	)		(479	)	$	(2,406	)		7,187		$	36,023			8,205		$	36,767
	Global Growth												Limited-Term Bond
	Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19						Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19
	Shares			Value			Shares			Value			Shares			Value			Shares			Value
Shares issued from sale of shares:
Class II		835		$	2,610			948		$	4,338			14,312		$	71,268			9,392		$	46,061
Shares issued in reinvestment of distributions to shareholders:
Class II		178			585			30,123			96,488			2,180			10,693			2,048			9,903
Shares redeemed:
Class II		(3,170	)		(10,657	)		(5,094	)		(23,423	)		(26,387	)		(131,411	)		(32,011	)		(157,413	)
Net increase (decrease)		(2,157	)	$	(7,462	)		25,977		$	77,403			(9,895	)	$	(49,450	)		(20,571	)	$	(101,449	)

2020 SEMIANNUAL REPORT 59

	Securian Real Estate Securities												Value
	Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19						Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19
	Shares			Value			Shares			Value			Shares			Value			Shares			Value
Shares issued from sale of shares:
Class II		355		$	2,356			428		$	3,239			12,178		$	63,038			4,195		$	26,513
Shares issued in reinvestment of distributions to shareholders:
Class II		494			2,884			99			744			5,308			26,609			5,212			30,616
Shares redeemed:
Class II		(606	)		(4,285	)		(1,311	)		(10,015	)		(17,071	)		(91,240	)		(11,823	)		(73,455	)
Net increase (decrease)		243		$	955			(784	)	$	(6,032	)		415		$	(1,593	)		(2,416	)	$	(16,326	)

10. COMMITMENTS

Bridge loan commitments may obligate a Portfolio to furnish temporary financing to a borrower until permanent financing can be arranged. In connection with these commitments, the Portfolio earns a commitment fee, typically set as a percentage of the commitment amount. Such fee income is included in interest income on the Statements of Operations. At June 30, 2020, there were no outstanding bridge loan commitments.

11. FEDERAL INCOME TAX MATTERS ($ amounts in thousands)

For Federal income tax purposes, cost of investments owned at June 30, 2020 and the related unrealized appreciation (depreciation) were as follows:

Portfolio	Cost of Investments		Gross Appreciation		Gross Depreciation		Net Unrealized Appreciation (Depreciation)
Core Equity	$	568,215	$	105,387	$	13,316	$	92,071
Corporate Bond		587,224		42,925		3,437		39,488
Global Bond		19,316		1,067		821		246
Global Equity Income		309,633		17,859		32,534		(14,675	)
Global Growth		106,728		34,504		4,647		29,857
Limited-Term Bond		396,012		9,970		1,129		8,841
Securian Real Estate Securities		30,681		1,954		3,727		(1,773	)
Value		420,449		27,477		52,195		(24,718	)

For Federal income tax purposes, the Portfolios’ undistributed earnings and profit for the year ended December 31, 2019 and the post-October and late-year ordinary activity updated with information available through the date of this report were as follows:

Portfolio	Undistributed Ordinary Income		Undistributed Long-Term Capital Gains		Tax Return of Capital		Post- October Capital Losses Deferred		Late-Year Ordinary Losses Deferred
Core Equity	$	9,948	$	31,253	$	—	$	—	$	—
Corporate Bond		15,224		—		—		—		—
Global Bond		781		—		—		—		—
Global Equity Income		8,009		—		—		—		—
Global Growth		581		—		—		—		—
Limited-Term Bond		10,690		—		—		—		—
Securian Real Estate Securities		942		1,940		—		—		—
Value		9,455		17,064		—		—		—

Internal Revenue Code regulations permit each Portfolio to elect to defer into its next fiscal year capital losses and certain specified ordinary items incurred between each November 1 and the end of its fiscal year. Each Portfolio is also permitted to defer into its next fiscal certain ordinary losses that generated between each January 1 and the end of its fiscal year.

60 SEMIANNUAL REPORT 2020

The tax character of dividends and distributions paid during the two fiscal years ended December 31, 2019 and 2018 were as follows:

	December 31, 2019				December 31, 2018
Portfolio	Distributed Ordinary Income(1)		Distributed Long-Term Capital Gains		Distributed Ordinary Income(1)		Distributed Long-Term Capital Gains
Core Equity	$	4,416	$	68,798	$	6,304	$	29,233
Corporate Bond		15,235		—		11,579		—
Global Bond		784		—		626		—
Global Equity Income		8,357		76,812		10,709		34,998
Global Growth		11,998		84,490		6,600		20,587
Limited-Term Bond		9,903		—		7,043		—
Securian Real Estate Securities		582		162		1,197		2,119
Value		3,917		26,699		7,704		12,385

(1) Includes short-term capital gains distributed, if any.

Dividends from net investment income and short-term capital gains are treated as ordinary income dividends for federal income tax purposes.

Accumulated capital losses represent net capital loss carryovers as of December 31, 2019 that may be available to offset future realized capital gains and thereby reduce future capital gains distributions. As of December 31, 2019, the capital loss carryforwards were as follows:

Portfolio	Short-Term Capital Loss Carryover		Long-Term Capital Loss Carryover
Core Equity	$	—	$	—
Corporate Bond		—		2,256
Global Bond		305		758
Global Equity Income		1,165		—
Global Growth		3,567		128
Limited-Term Bond		1,018		4,899
Securian Real Estate Securities		—		—
Value		—		—

2020 SEMIANNUAL REPORT 61

PROXY VOTING INFORMATION IVY VIP

(UNAUDITED)

Proxy Voting Guidelines

A description of the policies and procedures Ivy Variable Insurance Portfolios uses to determine how to vote proxies relating to portfolio securities is available (i) without charge, upon request, by calling 1.888.923-3355 and (ii) on the Securities and Exchange Commission’s (“SEC”) website at www.sec.gov.

Proxy Voting Records

Information regarding how the Portfolio voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on Form N-PX at www.ivyinvestments.com and on the SEC’s website at www.sec.gov.

    .

62 SEMIANNUAL REPORT 2020

QUARTERLY PORTFOLIO SCHEDULE INFORMATION IVY VIP

(UNAUDITED)

Portfolio holdings can be found on the Trust’s website at www.ivyinvestments.com. Alternatively, a complete schedule of portfolio holdings of each Portfolio for the first and third quarters of each fiscal year is filed with the SEC and can be found on the Trust’s Form N-Q and/or Form NPORT-EX . These holdings may be viewed in the following ways:

• On the SEC’s website at www.sec.gov.

• For review and copy at the SEC’s Public Reference Room in Washington, DC. Information on the operations of the Public Reference Room may be obtained by calling 1.800.SEC.0330.

2020 SEMIANNUAL REPORT 63

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64 SEMIANNUAL REPORT 2020

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2020 SEMIANNUAL REPORT 65

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66 SEMIANNUAL REPORT 2020

THE IVY VARIABLE INSURANCE PORTFOLIOS FAMILY

Global/International Portfolios

Global Equity Income

Global Growth

International Core Equity

Domestic Equity Portfolios

Core Equity

Growth

Mid Cap Growth

Small Cap Core

Small Cap Growth

Value

Fixed Income Portfolios

Corporate Bond

Global Bond

High Income

Limited-Term Bond

Money Market Portfolio

Government Money Market

Specialty Portfolios

Asset Strategy

Balanced

Energy

Natural Resources

Pathfinder Aggressive

Pathfinder Conservative

Pathfinder Moderate

Pathfinder Moderately Aggressive

Pathfinder Moderately Conservative

Pathfinder Moderate – Managed Volatility

Pathfinder Moderately Aggressive – Managed Volatility

Pathfinder Moderately Conservative – Managed Volatility

Science and Technology

Securian Real Estate Securities

The underlying portfolios discussed in this report are only available as investment options in variable annuity and variable life insurance contracts issued by life insurance companies. They are not offered or made available directly to the general public.

This report is submitted for the general information of the shareholders of Ivy Variable Insurance Portfolios. It is not authorized for distribution to prospective investors in a Portfolio unless accompanied with or preceded by the current Portfolio prospectus as well as the variable product prospectus.

2020 SEMIANNUAL REPORT 67

SEMIANN-VIP2 (06/20)

  VARIABLE INSURANCE PORTFOLIOS   Semiannual Report   JUNE 30, 2020

Ivy Variable Insurance Portfolios
Pathfinder Aggressive	Class II
Pathfinder Conservative	Class II
Pathfinder Moderate	Class II
Pathfinder Moderately Aggressive	Class II
Pathfinder Moderately Conservative	Class II
Pathfinder Moderate — Managed Volatility	Class II
Pathfinder Moderately Aggressive — Managed Volatility	Class II
Pathfinder Moderately Conservative — Managed Volatility	Class II
Government Money Market	Class II

Beginning on January 1, 2021, as permitted by regulations adopted by the U.S. Securities and Exchange Commission (SEC), you may not be receiving paper copies of the Fund’s annual or semi-annual shareholder reports by mail, unless you specifically request paper copies of the reports from the insurance company that offers your variable annuity or variable life insurance contract or from your financial intermediary. Instead of delivering paper copies of the report, the insurance company may choose to make the reports available on a website, and will notify you by mail each time a shareholder report is posted and provide you with a website link to access the report. Instructions for requesting paper copies will be provided by your insurance company.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the insurance company or your financial intermediary electronically by following the instructions provided by the insurance company or by contacting your financial intermediary.

You may elect to receive all future Fund shareholder reports in paper free of charge from the insurance company. You can inform the insurance company or your financial intermediary that you wish to continue receiving paper copies of your shareholder reports by following the instructions provided by the insurance company or by contacting your financial intermediary. Your election to receive reports in paper will apply to all portfolio companies available under your contract with the insurance company.

CONTENTS IVY VIP

President’s Letter	3
Illustration of Portfolio Expenses	4
Portfolio Highlights and Schedule of Investments:
Pathfinder Portfolios	6
Managed Volatility Portfolios
Government Money Market	12
Statements of Assets and Liabilities	14
Statements of Operations	16
Statements of Changes in Net Assets	18
Financial Highlights	20
Notes to Financial Statements	24
Proxy Voting Information	36
Quarterly Portfolio Schedule Information	37

2

PRESIDENT’S LETTER IVY VIP

	JUNE 30, 2020 (UNAUDITED)
Philip J. Sanders, CFA

Dear Shareholder,

Markets thus far in 2020 have been, to use an overused word, unprecedented. In a matter of months, we have witnessed economic and market moves that typically take an entire market cycle of many years to unfold. Financial markets had been positive in early 2020, as political conflicts, trade uncertainty and global economic growth concerns waned. However, that upward trajectory suddenly reversed in late February 2020 and markets declined in response to two exogenous shocks: the COVID-19 pandemic and the collapse in energy markets. The COVID-19 pandemic caused one of the most rapid and dramatic global economic downturns in history. The U.S. stock markets dropped approximately 35% from peak in February to trough in late March. Global economic activity hit a full stop around the world, as countries and businesses implemented plans to isolate and protect each other. The pause on economic activity, along with a conflict between Russia and Saudi Arabia, caused a historic rout in oil markets. Remarkably, within about 30 days, we moved from a relatively strong domestic economy with financial market indexes hitting record highs, to a global recession.

Governments and central banks have taken unprecedented steps to mitigate the economic blow of social distancing. Monetary policy response has been broader and more rapid than at any other time in history. Global central banks have enacted aggressive stimulus through lower interest rates, quantitative easing (QE) and liquidity provisions, with some developing countries implementing QE for the first time. The U.S. Federal Reserve’s (Fed) response has been the strongest with a broad array of policy measures including an unprecedented pace of QE.

Just as global central banks are acting aggressively, governments around the world are responding with fiscal stimulus. While projected budget deficits for many countries are huge, those figures include loans designed to keep companies afloat and people employed. Up to this point, the fiscal impulse for most major countries is between 5 and 10% of gross domestic product (GDP). This is extremely aggressive both in size and speed of implementation, as we have only been facing this pandemic for a few months. More global fiscal stimulus seems probable. For instance, in addition to the $2.2 trillion CARES (Coronavirus Aid, Relief and Economic Security) Act, we expect another large fiscal stimulus in the U.S. to become law, which will likely include some form of extension to unemployment benefits and provide aid to state and local governments.

Enthusiasm about the economy possibly regaining momentum has been muted by ongoing uncertainty regarding the public health risks of reopening. While volatility has retreated sharply from the record highs of late March, it remains at elevated levels. Recent moves have

shown that markets are likely to respond to changes in new COVID-19 cases, both positively and negatively. Since the March 23 trough, the S&P 500 Index has stabilized and experienced a rapid bounce back. Year-to-date as of June 30, the Index is down 3.1%. Given this rebound, investors might wonder if the market is ahead of itself.

As we move forward and examine the investment landscape, we continue to put greater emphasis on the fundamentals and quality of asset classes and sectors. We believe it is important to stay focused on the merits of individual market sectors, industries and company business models when making investment decisions. Those fundamentals historically have tended to outweigh external factors. In today’s environment, we believe there are many high-quality businesses offering attractive entry points and cyclicals that will likely be key beneficiaries as economies continue to recover. Importantly, through this uncertain time, we remain focused on the innovation and management skill within individual companies, the ultimate drivers of long-term stock prices.

Economic Snapshot

	6/30/2020			12/31/2019
S&P 500 Index		3,100.29			3,230.78
MSCI EAFE Index		1,780.58			2,036.94
10-Year Treasury Yield		0.66	%		1.92	%
U.S. unemployment rate		11.1	%		3.5	%
30-year fixed mortgage rate		3.13	%		3.74	%
Oil price per barrel		$39.27			$61.14

Sources: Bloomberg, U.S. Department of Labor, MBA, CME

All government statistics shown are subject to periodic revision. The S&P 500 Index is an unmanaged index that tracks the stocks of 500 primarily large-cap U.S. companies. MSCI EAFE Index is an unmanaged index comprised of securities that represent the securities markets in Europe, Australasia and the Far East. It is not possible to invest directly in any of these indexes. Mortgage rates are from BankRate and reflect the overnight national average rate on a conventional 30-year fixed loan. Oil prices reflect the market price of West Texas intermediate grade crude.

Respectfully,

Philip J. Sanders, CFA

President

The opinions expressed in this letter are those of the President of the Ivy Variable Insurance Portfolios and are current only through the end of the period of the report, as stated on the cover. The President’s views are subject to change at any time, based on market and other conditions, and no forecasts can be guaranteed.

2020 SEMIANNUAL REPORT 3

ILLUSTRATION OF PORTFOLIO EXPENSES IVY VIP

(UNAUDITED)

Expense Example

As a shareholder of a Portfolio, you incur ongoing costs, including management fees, distribution and service fees, and other Portfolio expenses. The following table is intended to help you understand your ongoing costs (in dollars) of investing in a Portfolio and to compare these costs with the ongoing costs of investing in other mutual funds. As a shareholder in the underlying Ivy VIP Portfolios, the Pathfinder Aggressive, Pathfinder Conservative, Pathfinder Moderate, Pathfinder Moderately Aggressive and Pathfinder Moderately Conservative Portfolios (collectively, the “Pathfinder Portfolios”) and the Pathfinder Moderate — Managed Volatility, Pathfinder Moderately Aggressive — Managed Volatility and Pathfinder Moderately Conservative — Managed Volatility Portfolios (collectively, the “Managed Volatility Portfolios”) will indirectly bear their pro rata share of the expenses incurred by the underlying funds. These expenses are not included in the Pathfinder Portfolios’ or Managed Volatility Portfolios’ annualized expense ratios or the expenses paid during the period. These expenses are, however, included in the effective expenses paid during the period. The example is based on an investment of $1,000 invested at the beginning of the period and held for the six-month period ended June 30, 2020.

Actual Expenses

The first section in the following table provides information about actual investment values and actual expenses for each share class. You may use the information in this section, together with your initial investment in Portfolio shares, to estimate the expenses that you paid over the period. Simply divide the value of that investment by $1,000 (for example, a $7,500 initial investment divided by $1,000 = 7.5), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your investment during this period. In addition, there are fees and expenses imposed under the variable annuity or variable life insurance contract through which shares of the Portfolio are held. Additional fees have the effect of reducing investment returns.

Hypothetical Example for Comparison Purposes

The second section in the following table provides information about hypothetical investment values and hypothetical expenses for each share class based on the Portfolio’s actual expense ratio and an assumed rate of return of five percent per year before expenses, which is not the Portfolio’s actual return. The hypothetical investment values and expenses may not be used to estimate the actual investment value at the end of the period or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Portfolio and other funds. To do so, compare this five percent hypothetical example with the five percent 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 as a shareholder of the Portfolio and do not reflect any fees and expenses imposed under the variable annuity or variable life insurance contract through which shares of the Portfolio are held.

Expenses paid may be impacted by expense reduction arrangements. If those arrangements had not been in place, expenses paid would have been higher. See Note 5 in Notes to Financial Statements for further information.

4 SEMIANNUAL REPORT 2020

ILLUSTRATION OF PORTFOLIO EXPENSES IVY VIP

(UNAUDITED)

	Actual(1)						Hypothetical(2)
Portfolio	Beginning Account Value 12-31-19		Ending Account Value 6-30-20		Expenses Paid During Period*		Beginning Account Value 12-31-19		Ending Account Value 6-30-20		Expenses Paid During Period*		Annualized Expense Ratio Based on the Six-Month Period
Pathfinder Aggressive
Class II	$	1,000	$	967.30	$	0.69	$	1,000	$	1,024.20	$	0.71		0.13%
Pathfinder Conservative
Class II	$	1,000	$	1,009.00	$	0.50	$	1,000	$	1,024.40	$	0.51		0.09%
Pathfinder Moderate
Class II	$	1,000	$	988.50	$	0.20	$	1,000	$	1,024.68	$	0.20		0.04%
Pathfinder Moderately Aggressive
Class II	$	1,000	$	977.90	$	0.20	$	1,000	$	1,024.69	$	0.20		0.04%
Pathfinder Moderately Conservative
Class II	$	1,000	$	998.70	$	0.30	$	1,000	$	1,024.55	$	0.30		0.06%
Pathfinder Moderate — Managed Volatility
Class II	$	1,000	$	961.90	$	1.08	$	1,000	$	1,023.72	$	1.11		0.23%
Pathfinder Moderately Aggressive — Managed Volatility
Class II	$	1,000	$	950.40	$	1.46	$	1,000	$	1,023.34	$	1.52		0.31%
Pathfinder Moderately Conservative — Managed Volatility
Class II	$	1,000	$	983.70	$	1.59	$	1,000	$	1,023.29	$	1.62		0.32%
Government Money Market
Class II	$	1,000	$	1,003.70	$	2.00	$	1,000	$	1,022.90	$	2.02		0.40%

* Portfolio expenses are equal to the Portfolio’s annualized expense ratio (provided in the table), multiplied by the average account value over the period, multiplied by 182 days in the six-month period ended June 30, 2020, and divided by 366.

(1) This section uses the Portfolio’s actual total return and actual Portfolio expenses. It is a guide to the actual expenses paid by the Portfolio in the period. The “Ending Account Value” shown is computed using the Portfolio’s actual return and the “Expenses Paid During Period” column shows the dollar amount that would have been paid by an investor who started with $1,000 in the Portfolio. A shareholder may use the information here, together with the dollar amount invested, to estimate the expenses that were paid over the period. For every thousand dollars a shareholder has invested, the expenses are listed in the last column of this section.

(2) This section uses a hypothetical five percent annual return and actual Portfolio expenses. It helps to compare the Portfolio’s ongoing costs with other mutual funds. A shareholder can compare the Portfolio’s ongoing costs by comparing this hypothetical example with the hypothetical examples that appear in shareholder reports of other Portfolios.

The above illustrations are based on ongoing costs only.

2020 SEMIANNUAL REPORT 5

PORTFOLIO HIGHLIGHTS PATHFINDER PORTFOLIOS

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Pathfinder Aggressive – Asset Allocation

Ivy VIP Growth, Class II	16.4%
Ivy VIP International Core Equity, Class II	16.1%
Ivy VIP Core Equity, Class II	13.2%
Ivy VIP Global Equity Income, Class II	13.2%
Ivy VIP Corporate Bond, Class II	10.9%
Ivy VIP Value, Class II	10.9%
Ivy VIP Mid Cap Growth, Class I	9.7%
Ivy VIP Limited-Term Bond, Class II	5.0%
Ivy VIP Small Cap Growth, Class I	2.5%
Ivy VIP Small Cap Core, Class II	1.2%
Ivy VIP High Income, Class I	0.2%
Liabilities (Net of Cash and Other Assets), and Cash Equivalents+	0.7%

Pathfinder Conservative – Asset Allocation

Ivy VIP Limited-Term Bond, Class II	25.0%
Ivy VIP Corporate Bond, Class II	23.1%
Ivy VIP Growth, Class II	10.2%
Ivy VIP Core Equity, Class II	8.2%
Ivy VIP Value, Class II	7.1%
Ivy VIP Government Money Market, Class II	7.0%
Ivy VIP Mid Cap Growth, Class I	6.6%
Ivy VIP International Core Equity, Class II	5.3%
Ivy VIP Global Equity Income, Class II	4.4%
Ivy VIP Small Cap Growth, Class I	1.5%
Ivy VIP High Income, Class I	1.2%
Ivy VIP Small Cap Core, Class II	0.2%
Cash and Other Assets (Net of Liabilities), and Cash Equivalents+	0.2%

Pathfinder Moderate – Asset Allocation

Ivy VIP Corporate Bond, Class II	16.6%
Ivy VIP Limited-Term Bond, Class II	15.1%
Ivy VIP Growth, Class II	13.4%
Ivy VIP Core Equity, Class II	10.7%
Ivy VIP International Core Equity, Class II	10.7%
Ivy VIP Value, Class II	9.0%
Ivy VIP Global Equity Income, Class II	8.8%
Ivy VIP Mid Cap Growth, Class I	8.2%
Ivy VIP Government Money Market, Class II	4.0%
Ivy VIP Small Cap Growth, Class I	2.0%
Ivy VIP High Income, Class I	0.7%
Ivy VIP Small Cap Core, Class II	0.7%
Cash and Other Assets (Net of Liabilities)	0.1%

Pathfinder Moderately Aggressive – Asset Allocation

Ivy VIP Growth, Class II	14.9%
Ivy VIP Corporate Bond, Class II	13.5%
Ivy VIP International Core Equity, Class II	13.4%
Ivy VIP Core Equity, Class II	12.0%
Ivy VIP Global Equity Income, Class II	11.0%
Ivy VIP Limited-Term Bond, Class II	10.1%
Ivy VIP Value, Class II	9.9%
Ivy VIP Mid Cap Growth, Class I	8.9%
Ivy VIP Government Money Market, Class II	2.3%
Ivy VIP Small Cap Growth, Class I	2.3%
Ivy VIP Small Cap Core, Class II	1.0%
Ivy VIP High Income, Class I	0.5%
Cash and Other Assets (Net of Liabilities), and Cash Equivalents+	0.2%

Pathfinder Moderately Conservative – Asset Allocation

Ivy VIP Corporate Bond, Class II	20.1%
Ivy VIP Limited-Term Bond, Class II	20.1%
Ivy VIP Growth, Class II	11.8%
Ivy VIP Core Equity, Class II	9.4%
Ivy VIP International Core Equity, Class II	8.0%
Ivy VIP Value, Class II	8.0%
Ivy VIP Mid Cap Growth, Class I	7.4%
Ivy VIP Global Equity Income, Class II	6.6%
Ivy VIP Government Money Market, Class II	5.2%
Ivy VIP Small Cap Growth, Class I	1.8%
Ivy VIP High Income, Class I	1.0%
Ivy VIP Small Cap Core, Class II	0.5%
Cash and Other Assets (Net of Liabilities), and Cash Equivalents+	0.1%

6 SEMIANNUAL REPORT 2020

PORTFOLIO HIGHLIGHTS PATHFINDER PORTFOLIOS

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Pathfinder Moderate – Managed Volatility – Asset Allocation

Ivy VIP Corporate Bond, Class II	16.0%
Ivy VIP Limited-Term Bond, Class II	14.6%
Ivy VIP Growth, Class II	12.9%
Ivy VIP International Core Equity, Class II	10.4%
Ivy VIP Core Equity, Class II	10.3%
Ivy VIP Value, Class II	8.7%
Ivy VIP Global Equity Income, Class II	8.5%
Ivy VIP Mid Cap Growth, Class I	7.9%
Ivy VIP Government Money Market, Class II	3.9%
Ivy VIP Small Cap Growth, Class I	1.9%
Ivy VIP High Income, Class I	0.7%
Ivy VIP Small Cap Core, Class II	0.7%
Cash and Other Assets (Net of Liabilities), and Cash Equivalents+	3.5%

Pathfinder Moderately Aggressive – Managed Volatility – Asset Allocation

Ivy VIP Growth, Class II	14.5%
Ivy VIP Corporate Bond, Class II	13.2%
Ivy VIP International Core Equity, Class II	13.1%
Ivy VIP Core Equity, Class II	11.7%
Ivy VIP Global Equity Income, Class II	10.8%
Ivy VIP Limited-Term Bond, Class II	9.8%
Ivy VIP Value, Class II	9.7%
Ivy VIP Mid Cap Growth, Class I	8.7%
Ivy VIP Government Money Market, Class II	2.2%
Ivy VIP Small Cap Growth, Class I	2.2%
Ivy VIP Small Cap Core, Class II	0.9%
Ivy VIP High Income, Class I	0.5%
Cash and Other Assets (Net of Liabilities), and Cash Equivalents+	2.7%

Pathfinder Moderately Conservative – Managed Volatility – Asset Allocation

Ivy VIP Corporate Bond, Class II	19.3%
Ivy VIP Limited-Term Bond, Class II	19.3%
Ivy VIP Growth, Class II	11.4%
Ivy VIP Core Equity, Class II	9.1%
Ivy VIP International Core Equity, Class II	7.8%
Ivy VIP Value, Class II	7.7%
Ivy VIP Mid Cap Growth, Class I	7.1%
Ivy VIP Global Equity Income, Class II	6.4%
Ivy VIP Government Money Market, Class II	5.0%
Ivy VIP Small Cap Growth, Class I	1.7%
Ivy VIP High Income, Class I	0.9%
Ivy VIP Small Cap Core, Class II	0.5%
Cash and Other Assets (Net of Liabilities), and Cash Equivalents+	3.8%

The percentages of investments in the underlying funds may not currently be within the target allocation ranges disclosed in the Portfolios’ prospectus due to market movements; these percentages are expected to change over time, and deviation from the target allocation ranges due to market movements is permitted by the prospectus.

+Cash equivalents are defined as highly liquid securities with maturities of less than three months. Cash equivalents may include U.S. Government Treasury bills, bank certificates of deposit, bankers’ acceptances, corporate commercial paper and other money market instruments.

2020 SEMIANNUAL REPORT 7

SCHEDULE OF INVESTMENTS PATHFINDER PORTFOLIOS (in thousands)

JUNE 30, 2020 (UNAUDITED)

Pathfinder Aggressive

AFFILIATED MUTUAL FUNDS	Shares		Value
Ivy VIP Core Equity, Class II		671	$	7,838
Ivy VIP Corporate Bond, Class II		1,120		6,499
Ivy VIP Global Equity Income, Class II		1,556		7,840
Ivy VIP Growth, Class II		922		9,761
Ivy VIP High Income, Class I		49		146
Ivy VIP International Core Equity, Class II		703		9,569
Ivy VIP Limited-Term Bond, Class II		602		2,982
Ivy VIP Mid Cap Growth, Class I		436		5,749
Ivy VIP Small Cap Core, Class II		66		711
Ivy VIP Small Cap Growth, Class I		171		1,499
Ivy VIP Value, Class II		1,247		6,458
TOTAL AFFILIATED MUTUAL FUNDS – 99.3%			$	59,052
(Cost: $68,653)
SHORT-TERM SECURITIES
Money Market Funds (A) – 0.7%
State Street Institutional U.S. Government Money Market Fund - Premier Class, 0.120%		388		388
TOTAL SHORT-TERM SECURITIES – 0.7%			$	388
(Cost: $388)
TOTAL INVESTMENT SECURITIES – 100.0%			$	59,440
(Cost: $69,041)
LIABILITIES, NET OF CASH AND OTHER ASSETS – 0.0%				(15	)
NET ASSETS – 100.0%			$	59,425

Notes to Schedule of Investments

(A) Rate shown is the annualized 7-day yield at June 30, 2020.

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Affiliated Mutual Funds	$	59,052	$	—	$	—
Short-Term Securities		388		—		—
Total	$	59,440	$	—	$	—

See Accompanying Notes to Financial Statements.

Pathfinder Conservative

AFFILIATED MUTUAL FUNDS	Shares		Value
Ivy VIP Core Equity, Class II		675	$	7,877
Ivy VIP Corporate Bond, Class II		3,832		22,245
Ivy VIP Global Equity Income, Class II		837		4,220
Ivy VIP Government Money Market, Class II		6,719		6,719
Ivy VIP Growth, Class II		931		9,851
Ivy VIP High Income, Class I		397		1,181
Ivy VIP International Core Equity, Class II		379		5,151
Ivy VIP Limited-Term Bond, Class II		4,867		24,112
Ivy VIP Mid Cap Growth, Class I		481		6,349
Ivy VIP Small Cap Core, Class II		21		229
Ivy VIP Small Cap Growth, Class I		165		1,451
Ivy VIP Value, Class II		1,311		6,794
TOTAL AFFILIATED MUTUAL FUNDS – 99.8%			$	96,179
(Cost: $102,018)
SHORT-TERM SECURITIES
Money Market Funds (A) – 0.1%
State Street Institutional U.S. Government Money Market Fund - Premier Class, 0.120%		98		98
TOTAL SHORT-TERM SECURITIES – 0.1%			$	98
(Cost: $98)
TOTAL INVESTMENT SECURITIES – 99.9%			$	96,277
(Cost: $102,116)
CASH AND OTHER ASSETS, NET OF LIABILITIES – 0.1%				135
NET ASSETS – 100.0%			$	96,412

Notes to Schedule of Investments

(A) Rate shown is the annualized 7-day yield at June 30, 2020.

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Affiliated Mutual Funds	$	96,179	$	—	$	—
Short-Term Securities		98		—		—
Total	$	96,277	$	—	$	—

See Accompanying Notes to Financial Statements.

Pathfinder Moderate

AFFILIATED MUTUAL FUNDS	Shares		Value
Ivy VIP Core Equity, Class II		5,629	$	65,715
Ivy VIP Corporate Bond, Class II		17,506		101,617
Ivy VIP Global Equity Income, Class II		10,719		54,027
Ivy VIP Government Money Market, Class II		24,558		24,558
Ivy VIP Growth, Class II		7,744		81,973
Ivy VIP High Income, Class I		1,523		4,534
Ivy VIP International Core Equity, Class II		4,848		65,946
Ivy VIP Limited-Term Bond, Class II		18,679		92,534
Ivy VIP Mid Cap Growth, Class I		3,792		50,031
Ivy VIP Small Cap Core, Class II		410		4,404
Ivy VIP Small Cap Growth, Class I		1,410		12,391
Ivy VIP Value, Class II		10,642		55,128
TOTAL AFFILIATED MUTUAL FUNDS – 99.9%			$	612,858
(Cost: $676,716)
TOTAL INVESTMENT SECURITIES – 99.9%			$	612,858
(Cost: $676,716)
CASH AND OTHER ASSETS, NET OF LIABILITIES – 0.1%				770
NET ASSETS – 100.0%			$	613,628

Notes to Schedule of Investments

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Affiliated Mutual Funds	$	612,858	$	—	$	—
Total	$	612,858	$	—	$	—

See Accompanying Notes to Financial Statements.

8 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS PATHFINDER PORTFOLIOS (in thousands)

JUNE 30, 2020 (UNAUDITED)

Pathfinder Moderately Aggressive

AFFILIATED MUTUAL FUNDS	Shares		Value
Ivy VIP Core Equity, Class II		7,586	$	88,560
Ivy VIP Corporate Bond, Class II		17,222		99,969
Ivy VIP Global Equity Income, Class II		16,177		81,533
Ivy VIP Government Money Market, Class II		16,669		16,669
Ivy VIP Growth, Class II		10,425		110,351
Ivy VIP High Income, Class I		1,225		3,648
Ivy VIP International Core Equity, Class II		7,316		99,519
Ivy VIP Limited-Term Bond, Class II		15,026		74,439
Ivy VIP Mid Cap Growth, Class I		5,006		66,055
Ivy VIP Small Cap Core, Class II		660		7,093
Ivy VIP Small Cap Growth, Class I		1,916		16,831
Ivy VIP Value, Class II		14,206		73,589
TOTAL AFFILIATED MUTUAL FUNDS – 99.8%			$	738,256
(Cost: $831,353)
SHORT-TERM SECURITIES
Money Market Funds (A) – 0.1%
State Street Institutional U.S. Government Money Market Fund - Premier Class, 0.120%		704		704
TOTAL SHORT-TERM SECURITIES – 0.1%			$	704
(Cost: $704)
TOTAL INVESTMENT SECURITIES – 99.9%			$	738,960
(Cost: $832,057)
CASH AND OTHER ASSETS, NET OF LIABILITIES – 0.1%				571
NET ASSETS – 100.0%			$	739,531

Notes to Schedule of Investments

(A) Rate shown is the annualized 7-day yield at June 30, 2020.

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Affiliated Mutual Funds	$	738,256	$	—	$	—
Short-Term Securities		704		—		—
Total	$	738,960	$	—	$	—

See Accompanying Notes to Financial Statements.

Pathfinder Moderately Conservative

AFFILIATED MUTUAL FUNDS	Shares		Value
Ivy VIP Core Equity, Class II		1,499	$	17,499
Ivy VIP Corporate Bond, Class II		6,415		37,234
Ivy VIP Global Equity Income, Class II		2,423		12,210
Ivy VIP Government Money Market, Class II		9,717		9,717
Ivy VIP Growth, Class II		2,064		21,853
Ivy VIP High Income, Class I		612		1,823
Ivy VIP International Core Equity, Class II		1,096		14,904
Ivy VIP Limited-Term Bond, Class II		7,508		37,194
Ivy VIP Mid Cap Growth, Class I		1,035		13,662
Ivy VIP Small Cap Core, Class II		82		885
Ivy VIP Small Cap Growth, Class I		372		3,267
Ivy VIP Value, Class II		2,869		14,861
TOTAL AFFILIATED MUTUAL FUNDS – 99.9%			$	185,109
(Cost: $200,567)
SHORT-TERM SECURITIES
Money Market Funds (A) – 0.1%
State Street Institutional U.S. Government Money Market Fund - Premier Class, 0.120%		146		146
TOTAL SHORT-TERM SECURITIES – 0.1%			$	146
(Cost: $146)
TOTAL INVESTMENT SECURITIES – 100.0%			$	185,255
(Cost: $200,713)
CASH AND OTHER ASSETS, NET OF LIABILITIES – 0.0%				62
NET ASSETS – 100.0%			$	185,317

Notes to Schedule of Investments

(A) Rate shown is the annualized 7-day yield at June 30, 2020.

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Affiliated Mutual Funds	$	185,109	$	—	$	—
Short-Term Securities		146		—		—
Total	$	185,255	$	—	$	—

See Accompanying Notes to Financial Statements.

Pathfinder Moderate – Managed Volatility

AFFILIATED MUTUAL FUNDS	Shares		Value
Ivy VIP Core Equity, Class II		5,888	$	68,735
Ivy VIP Corporate Bond, Class II		18,302		106,234
Ivy VIP Global Equity Income, Class II		11,213		56,517
Ivy VIP Government Money Market, Class II		25,677		25,677
Ivy VIP Growth, Class II		8,098		85,717
Ivy VIP High Income, Class I		1,592		4,742
Ivy VIP International Core Equity, Class II		5,071		68,984
Ivy VIP Limited-Term Bond, Class II		19,529		96,745
Ivy VIP Mid Cap Growth, Class I		3,965		52,319
Ivy VIP Small Cap Core, Class II		429		4,609
Ivy VIP Small Cap Growth, Class I		1,475		12,960
Ivy VIP Value, Class II		11,135		57,683
TOTAL AFFILIATED MUTUAL FUNDS – 96.5%			$	640,922
(Cost: $698,696)
SHORT-TERM SECURITIES
Money Market Funds (A) – 2.6%
State Street Institutional U.S. Government Money Market Fund - Premier Class, 0.120%		17,286		17,286
TOTAL SHORT-TERM SECURITIES – 2.6%			$	17,286
(Cost: $17,286)
TOTAL INVESTMENT SECURITIES – 99.1%			$	658,208
(Cost: $715,982)
CASH AND OTHER ASSETS, NET OF LIABILITIES (B) – 0.9%				6,125
NET ASSETS – 100.0%			$	664,333

Notes to Schedule of Investments

(A) Rate shown is the annualized 7-day yield at June 30, 2020.

(B) Cash of $7,536 has been pledged as collateral on open futures contracts.

The following futures contracts were outstanding at June 30, 2020 (contracts unrounded):

Description	Type	Number of Contracts		Expiration Date		Notional Amount		Value			Unrealized Appreciation
E-mini Russell 2000 Index	Short		150		9-19-20		8	$	(10,782	)	$	502
E-mini S&P 500 Index	Short		548		9-19-20		27		(84,671	)		103
								$	(95,453	)	$	605

2020 SEMIANNUAL REPORT 9

SCHEDULE OF INVESTMENTS PATHFINDER PORTFOLIOS (in thousands)

JUNE 30, 2020 (UNAUDITED)

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Affiliated Mutual Funds	$	640,922	$	—	$	—
Short-Term Securities		17,286		—		—
Total	$	658,208	$	—	$	—
Futures Contracts	$	605	$	—	$	—

See Accompanying Notes to Financial Statements.

Pathfinder Moderately Aggressive – Managed Volatility

AFFILIATED MUTUAL FUNDS	Shares		Value
Ivy VIP Core Equity, Class II		860	$	10,034
Ivy VIP Corporate Bond, Class II		1,951		11,322
Ivy VIP Global Equity Income, Class II		1,833		9,238
Ivy VIP Government Money Market, Class II		1,888		1,888
Ivy VIP Growth, Class II		1,181		12,500
Ivy VIP High Income, Class I		139		413
Ivy VIP International Core Equity, Class II		829		11,276
Ivy VIP Limited-Term Bond, Class II		1,702		8,431
Ivy VIP Mid Cap Growth, Class I		567		7,483
Ivy VIP Small Cap Core, Class II		75		804
Ivy VIP Small Cap Growth, Class I		217		1,907
Ivy VIP Value, Class II		1,610		8,339
TOTAL AFFILIATED MUTUAL FUNDS – 97.3%			$	83,635
(Cost: $94,824)
SHORT-TERM SECURITIES
Money Market Funds (A) – 1.8%
State Street Institutional U.S. Government Money Market Fund - Premier Class, 0.120%		1,568		1,568
TOTAL SHORT-TERM SECURITIES – 1.8%			$	1,568
(Cost: $1,568)
TOTAL INVESTMENT SECURITIES – 99.1%			$	85,203
(Cost: $96,392)
CASH AND OTHER ASSETS, NET OF LIABILITIES (B) – 0.9%				778
NET ASSETS – 100.0%			$	85,981

Notes to Schedule of Investments

(A) Rate shown is the annualized 7-day yield at June 30, 2020.

(B) Cash of $962 has been pledged as collateral on open futures contracts.

The following futures contracts were outstanding at June 30, 2020 (contracts unrounded):

Description	Type	Number of Contracts		Expiration Date		Notional Amount		Value			Unrealized Appreciation
E-mini Russell 2000 Index	Short		19		9-19-20		1	$	(1,366	)	$	63
E-mini S&P 500 Index	Short		70		9-19-20		3		(10,815	)		10
								$	(12,181	)	$	73

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Affiliated Mutual Funds	$	83,635	$	—	$	—
Short-Term Securities		1,568		—		—
Total	$	85,203	$	—	$	—
Futures Contracts	$	73	$	—	$	—

See Accompanying Notes to Financial Statements.

10 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS PATHFINDER PORTFOLIOS (in thousands)

JUNE 30, 2020 (UNAUDITED)

Pathfinder Moderately Conservative – Managed Volatility

AFFILIATED MUTUAL FUNDS	Shares		Value
Ivy VIP Core Equity, Class II		615	$	7,179
Ivy VIP Corporate Bond, Class II		2,630		15,269
Ivy VIP Global Equity Income, Class II		994		5,010
Ivy VIP Government Money Market, Class II		3,985		3,985
Ivy VIP Growth, Class II		847		8,964
Ivy VIP High Income, Class I		251		747
Ivy VIP International Core Equity, Class II		450		6,115
Ivy VIP Limited-Term Bond, Class II		3,079		15,252
Ivy VIP Mid Cap Growth, Class I		425		5,604
Ivy VIP Small Cap Core, Class II		34		363
Ivy VIP Small Cap Growth, Class I		153		1,340
Ivy VIP Value, Class II		1,177		6,099
TOTAL AFFILIATED MUTUAL FUNDS – 96.2%			$	75,927
(Cost: $81,655)
SHORT-TERM SECURITIES
Money Market Funds (A) – 2.5%
State Street Institutional U.S. Government Money Market Fund - Premier Class, 0.120%		1,946		1,946
TOTAL SHORT-TERM SECURITIES – 2.5%			$	1,946
(Cost: $1,946)
TOTAL INVESTMENT SECURITIES – 98.7%			$	77,873
(Cost: $83,601)
CASH AND OTHER ASSETS, NET OF LIABILITIES (B) – 1.3%				1,054
NET ASSETS – 100.0%			$	78,927

Notes to Schedule of Investments

(A) Rate shown is the annualized 7-day yield at June 30, 2020.

(B) Cash of $887 has been pledged as collateral on open futures contracts.

The following futures contracts were outstanding at June 30, 2020 (contracts unrounded):

Description	Type	Number of Contracts		Expiration Date		Notional Amount		Value			Unrealized Appreciation
E-mini Russell 2000 Index	Short		13		9-19-20		1	$	(935	)	$	44
E-mini S&P 500 Index	Short		67		9-19-20		3		(10,352	)		84
								$	(11,287	)	$	128

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Affiliated Mutual Funds	$	75,927	$	—	$	—
Short-Term Securities		1,946		—		—
Total	$	77,873	$	—	$	—
Futures Contracts	$	128	$	—	$	—

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 11

PORTFOLIO HIGHLIGHTS GOVERNMENT MONEY MARKET

ALL DATA IS AS OF JUNE 30, 2020 (UNAUDITED)

Asset Allocation

Investment Funds	43.3%
Money Market Funds	43.3%
Corporate Obligations	0.6%
Master Note	0.6%
United States Government Agency Obligations	56.1%
Liabilities (Net of Cash and Other Assets)	0.0%

12 SEMIANNUAL REPORT 2020

SCHEDULE OF INVESTMENTS GOVERNMENT MONEY MARKET (in thousands)

JUNE 30, 2020 (UNAUDITED)

INVESTMENT FUNDS	Shares		Value
Money Market Funds (A) – 43.3%
State Street Institutional U.S. Government Money Market Fund - Premier Class, 0.120%, 7-1-20		63,293	$	63,293
TOTAL INVESTMENT FUNDS – 43.3%			$	63,293
(Cost: $63,293)
CORPORATE OBLIGATIONS	Principal
Master Note
Toyota Motor Credit Corp. (1-Week U.S. LIBOR plus 25 bps), 0.360%, 7-7-20 (B)	$	887		887
Total Master Note – 0.6%				887
TOTAL CORPORATE OBLIGATIONS – 0.6%			$	887
(Cost: $887)
UNITED STATES GOVERNMENT AGENCY OBLIGATIONS
United States Government Agency Obligations – 56.1%
U.S. International Development Finance Corp. (GTD by U.S. Government) (3-Month U.S. TB Rate):
0.350%, 7-7-20 (B)		20,500		20,500
0.370%, 7-7-20 (B)		21,110		21,110
0.400%, 7-7-20 (B)		18,900		18,901
0.450%, 7-7-20 (B)		21,432		21,432
				81,943
TOTAL UNITED STATES GOVERNMENT AGENCY OBLIGATIONS – 56.1%			$	81,943
(Cost: $81,943)
TOTAL INVESTMENT SECURITIES – 100.0%			$	146,123
(Cost: $146,123)
LIABILITIES, NET OF CASH AND OTHER ASSETS – 0.0%				(68	)
NET ASSETS – 100.0%			$	146,055

Notes to Schedule of Investments

(A) Rate shown is the annualized 7-day yield at June 30, 2020.

(B) Variable rate security. Interest rate disclosed is that which is in effect at June 30, 2020. Date shown represents the date that the variable rate resets. Description of the reference rate and spread, if applicable, are included in the security description.

The following table is a summary of the valuation of the Portfolio’s investments by the fair value hierarchy levels as of June 30, 2020. See Note 3 to the Financial Statements for further information regarding fair value measurement.

	Level 1		Level 2		Level 3
Assets
Investments in Securities
Investment Funds	$	63,293	$	—	$	—
Corporate Obligations		—		887		—
United States Government Agency Obligations		—		81,943		—
Total	$	63,293	$	82,830	$	—

The following acronyms are used throughout this schedule:

GTD = Guaranteed

LIBOR = London Interbank Offered Rate

TB = Treasury Bill

2020 SEMIANNUAL REPORT 13

STATEMENTS OF ASSETS AND LIABILITIES IVY VIP

AS OF JUNE 30, 2020 (UNAUDITED)

(In thousands, except per share amounts)	Pathfinder Aggressive				Pathfinder Conservative				Pathfinder Moderate				Pathfinder Moderately Aggressive				Pathfinder Moderately Conservative				Pathfinder Moderate - Managed Volatility				Pathfinder Moderately Aggressive - Managed Volatility				Pathfinder Moderately Conservative - Managed Volatility
ASSETS
Investments in unaffiliated securities at value+		$	388			$	98			$	—			$	704			$	146			$	17,286			$	1,568			$	1,946
Investments in affiliated securities at value+			59,052				96,179				612,858				738,256				185,109				640,922				83,635				75,927
Investments at Value			59,440				96,277				612,858				738,960				185,255				658,208				85,203				77,873
Restricted cash			—				—				—				—				—				7,536				962				887
Investment securities sold receivable			—				302				2,090				796				254				—				—				—
Dividends and interest receivable			—	*			—	*			—	*			—	*			—	*			2				—	*			—	*
Capital shares sold receivable			—	*			—	*			1				—	*			—	*			3				—	*			336
Total Assets			59,440				96,579				614,949				739,756				185,509				665,749				86,165				79,096
LIABILITIES
Capital shares redeemed payable			2				151				653				135				165				100				12				7
Independent Trustees and Chief Compliance Officer fees payable			6				8				55				65				17				18				3				2
Overdraft due to custodian			—				—				590				—				—				—				—				—
Investment management fee payable			—				—				—				—				—				3				—				1
Accounting services fee payable			2				2				9				10				3				9				2				2
Variation margin payable			—				—				—				—				—				1,273				162				152
Other liabilities			5				6				14				15				7				13				5				5
Total Liabilities			15				167				1,321				225				192				1,416				184				169
Total Net Assets		$	59,425			$	96,412			$	613,628			$	739,531			$	185,317			$	664,333			$	85,981			$	78,927
NET ASSETS
Capital paid in (shares authorized – unlimited)		$	65,028			$	97,191			$	641,663			$	788,124			$	190,512			$	698,420			$	94,184			$	81,093
Accumulated earnings loss			(5,603	)			(779	)			(28,035	)			(48,593	)			(5,195	)			(34,087	)			(8,203	)			(2,166	)
Total Net Assets		$	59,425			$	96,412			$	613,628			$	739,531			$	185,317			$	664,333			$	85,981			$	78,927
CAPITAL SHARES OUTSTANDING:
Class II			14,459				20,255				137,927				167,968				40,020				130,663				18,187				15,595
NET ASSET VALUE PER SHARE:
Class II		$	4.11			$	4.76			$	4.45			$	4.40			$	4.63			$	5.08			$	4.73			$	5.06
+COST
Investments in unaffiliated securities at cost		$	388			$	98			$	—			$	704			$	146			$	17,286			$	1,568			$	1,946
Investments in affiliated securities at cost			68,653				102,018				676,716				831,353				200,567				698,696				94,824				81,655

*Not shown due to rounding.

See Accompanying Notes to Financial Statements.

14 SEMIANNUAL REPORT 2020

STATEMENTS OF ASSETS AND LIABILITIES IVY VIP

AS OF JUNE 30, 2020 (UNAUDITED)

(In thousands, except per share amounts)	Government Money Market
ASSETS
Investments in unaffiliated securities at value+		$	146,123
Investments at Value			146,123
Dividends and interest receivable			75
Capital shares sold receivable			10
Receivable from affiliates			29
Prepaid and other assets			1
Total Assets			146,238
LIABILITIES
Capital shares redeemed payable			140
Distributions payable			—	*
Independent Trustees and Chief Compliance Officer fees payable			32
Investment management fee payable			1
Accounting services fee payable			5
Other liabilities			5
Total Liabilities			183
Total Net Assets		$	146,055
NET ASSETS
Capital paid in (shares authorized – unlimited)		$	146,055
Accumulated earnings gain			—	*
Total Net Assets		$	146,055
CAPITAL SHARES OUTSTANDING:
Class II			146,059
NET ASSET VALUE PER SHARE:
Class II		$	1.00
+COST
Investments in unaffiliated securities at cost		$	146,123

*Not shown due to rounding.

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 15

STATEMENTS OF OPERATIONS IVY VIP

FOR THE SIX MONTHS ENDED JUNE 30, 2020 (UNAUDITED)

(In thousands)	Pathfinder Aggressive				Pathfinder Conservative				Pathfinder Moderate				Pathfinder Moderately Aggressive				Pathfinder Moderately Conservative				Pathfinder Moderate - Managed Volatility				Pathfinder Moderately Aggressive - Managed Volatility				Pathfinder Moderately Conservative - Managed Volatility
INVESTMENT INCOME
Dividends from affiliated securities		$	1,246			$	2,117			$	13,072			$	15,492			$	4,035			$	13,609			$	1,743			$	1,652
Interest and amortization from unaffiliated securities			1				2				4				3				1				61				7				7
Total Investment Income			1,247				2,119				13,076				15,495				4,036				13,670				1,750				1,659
EXPENSES
Investment management fee			—				—				—				—				—				638				86				78
Distribution and service fees:
Shareholder servicing:
Class II			—	*			—	*			—	*			—	*			—	*			—	*			—	*			—	*
Custodian fees			—	*			1				1				2				1				1				1				1
Independent Trustees and Chief Compliance Officer fees			2				2				13				16				4				18				3				2
Accounting services fee			12				14				55				63				23				57				13				13
Professional fees			23				23				26				26				23				29				25				25
Insurance fees			1				1				11				13				3				10				1				1
Printing fees			2				3				8				9				4				7				1				2
Other			—	*			—	*			1				1				—	*			1				1				—	*
Total Expenses			40				44				115				130				58				761				131				122
Net Investment Income			1,207				2,075				12,961				15,365				3,978				12,909				1,619				1,537
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:
Investments in unaffiliated securities			—				—				—				—				—				—				—				—	*
Investments in affiliated securities			616				744				4,295				4,395				1,283				10,777				1,073				1,385
Distributions of realized capital gains from affiliated securities			2,218				2,303				18,746				24,920				5,066				19,500				2,800				2,073
Futures contracts			—				—				—				—				—				(20,629	)			(2,620	)			(1,605	)
Net change in unrealized appreciation (depreciation) on:
Investments in unaffiliated securities			—	*			—	*			—	*			—	*			—				—	*			—	*			—	*
Investments in affiliated securities			(6,251	)			(4,442	)			(45,812	)			(64,880	)			(11,156	)			(50,844	)			(7,609	)			(4,804	)
Futures contracts			—				—				—				—				—				1,184				140				195
Net Realized and Unrealized Loss			(3,417	)			(1,395	)			(22,771	)			(35,565	)			(4,807	)			(40,012	)			(6,216	)			(2,756	)
Net Increase (Decrease) in Net Assets Resulting from Operations		$	(2,210	)		$	680			$	(9,810	)		$	(20,200	)		$	(829	)		$	(27,103	)		$	(4,597	)		$	(1,219	)

*Not shown due to rounding.

See Accompanying Notes to Financial Statements.

16 SEMIANNUAL REPORT 2020

STATEMENTS OF OPERATIONS IVY VIP

FOR THE SIX MONTHS ENDED JUNE 30, 2020 (UNAUDITED)

(In thousands)	Government Money Market
INVESTMENT INCOME
Interest and amortization from unaffiliated securities		$	921
Total Investment Income			921
EXPENSES
Investment management fee			271
Distribution and service fees:
Shareholder servicing:
Class II			—	*
Custodian fees			2
Independent Trustees and Chief Compliance Officer fees			5
Accounting services fee			32
Professional fees			20
Other			4
Total Expenses			334
Less:
Expenses in excess of limit			(29	)
Total Net Expenses			305
Net Investment Income			616
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:
Investments in unaffiliated securities			—	*
Net change in unrealized appreciation (depreciation) on:
Investments in unaffiliated securities			—
Net Realized and Unrealized Gain			—	*
Net Increase in Net Assets Resulting from Operations		$	616

*Not shown due to rounding.

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 17

STATEMENTS OF CHANGES IN NET ASSETS IVY VIP

	Pathfinder Aggressive								Pathfinder Conservative								Pathfinder Moderate
(In thousands)	Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19				Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19				Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income		$	1,207			$	907			$	2,075			$	1,687			$	12,961			$	11,452
Net realized gain on investments			2,834				7,868				3,047				6,321				23,041				68,117
Net change in unrealized appreciation (depreciation)			(6,251	)			4,449				(4,442	)			5,418				(45,812	)			44,037
Net Increase (Decrease) in Net Assets Resulting from Operations			(2,210	)			13,224				680				13,426				(9,810	)			123,606
Distributions to Shareholders From:
Accumulated earnings:
(combined net investment income and net realized gains)
Class II			(8,769	)			(7,374	)			(7,982	)			(6,905	)			(79,595	)			(75,615	)
Total Distributions to Shareholders			(8,769	)			(7,374	)			(7,982	)			(6,905	)			(79,595	)			(75,615	)
Capital Share Transactions			4,266				1,498				4,901				(1,287	)			23,114				(70,658	)
Net Increase (Decrease) in Net Assets			(6,713	)			7,348				(2,401	)			5,234				(66,291	)			(22,667	)
Net Assets, Beginning of Period			66,138				58,790				98,813				93,579				679,919				702,586
Net Assets, End of Period		$	59,425			$	66,138			$	96,412			$	98,813			$	613,628			$	679,919
	Pathfinder Moderately Aggressive								Pathfinder Moderately Conservative								Pathfinder Moderate - Managed Volatility
(In thousands)	Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19				Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19				Six months ended 6-30-20 (Unaudited)				Year ended 12-31-19
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income		$	15,365			$	13,376			$	3,978			$	3,491			$	12,909			$	9,293
Net realized gain on investments			29,315				96,363				6,349				16,658				9,648				52,655
Net change in unrealized appreciation (depreciation)			(64,880	)			55,859				(11,156	)			12,370				(49,660	)			42,967
Net Increase (Decrease) in Net Assets Resulting from Operations			(20,200	)			165,598				(829	)			32,519				(27,103	)			104,915
Distributions to Shareholders From:
Accumulated earnings:
(combined net investment income and net realized gains)
Class II			(109,757	)			(102,589	)			(20,114	)			(18,438	)			(60,610	)			(43,825	)
Total Distributions to Shareholders			(109,757	)			(102,589	)			(20,114	)			(18,438	)			(60,610	)			(43,825	)
Capital Share Transactions			40,581				(72,019	)			4,529				(17,598	)			44,954				40,173
Net Increase (Decrease) in Net Assets			(89,376	)			(9,010	)			(16,414	)			(3,517	)			(42,759	)			101,263
Net Assets, Beginning of Period			828,907				837,917				201,731				205,248				707,092				605,829
Net Assets, End of Period		$	739,531			$	828,907			$	185,317			$	201,731			$	664,333			$	707,092

See Accompanying Notes to Financial Statements.

18 SEMIANNUAL REPORT 2020

STATEMENTS OF CHANGES IN NET ASSETS IVY VIP

	Pathfinder Moderately Aggressive - Managed Volatility						Pathfinder Moderately Conservative - Managed Volatility						Government Money Market
(In thousands)	Six months ended 6-30-20 (Unaudited)			Year ended 12-31-19			Six months ended 6-30-20 (Unaudited)			Year ended 12-31-19			Six months ended 6-30-20 (Unaudited)			Year ended 12-31-19
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income	$	1,619		$	1,203		$	1,537		$	1,133		$	616		$	3,937
Net realized gain on investments		1,253			8,777			1,853			5,094			—	*		—	*
Net change in unrealized appreciation (depreciation)		(7,469	)		5,825			(4,609	)		4,537			—			—
Net Increase (Decrease) in Net Assets Resulting from Operations		(4,597	)		15,805			(1,219	)		10,764			616			3,937
Distributions to Shareholders From:
Accumulated earnings:
(combined net investment income and net realized gains)
Class II		(9,697	)		(7,558	)		(6,043	)		(4,908	)		(616	)		(3,964	)
Total Distributions to Shareholders		(9,697	)		(7,558	)		(6,043	)		(4,908	)		(616	)		(3,964	)
Capital Share Transactions		6,995			1,066			5,743			1,754			(37,968	)		(54,886	)
Net Increase (Decrease) in Net Assets		(7,299	)		9,313			(1,519	)		7,610			(37,968	)		(54,913	)
Net Assets, Beginning of Period		93,280			83,967			80,446			72,836			184,023			238,936
Net Assets, End of Period	$	85,981		$	93,280		$	78,927		$	80,446		$	146,055		$	184,023

*Not shown due to rounding.

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 19

FINANCIAL HIGHLIGHTS IVY VIP

FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD

	Net Asset Value, Beginning of Period			Net Investment Income(1)			Net Realized and Unrealized Gain (Loss) on Investments				Total from Investment Operations				Distributions From Net Investment Income				Distributions From Net Realized Gains				Total Distributions
Pathfinder Aggressive
Class II Shares
Six-month period ended 6-30-2020 (unaudited)		$	5.00		$	0.09		$	(0.29	)		$	(0.20	)		$	(0.07	)		$	(0.62	)		$	(0.69	)
Year ended 12-31-2019			4.60			0.07			0.92				0.99				(0.14	)			(0.45	)			(0.59	)
Year ended 12-31-2018			5.16			0.13			(0.32	)			(0.19	)			(0.09	)			(0.28	)			(0.37	)
Year ended 12-31-2017			4.68			0.08			0.80				0.88				(0.05	)			(0.35	)			(0.40	)
Year ended 12-31-2016			5.05			0.04			0.15				0.19				(0.07	)			(0.49	)			(0.56	)
Year ended 12-31-2015			5.73			0.07			(0.01	)			0.06				(0.16	)			(0.58	)			(0.74	)
Pathfinder Conservative
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			5.15			0.11			(0.07	)			0.04				(0.09	)			(0.34	)			(0.43	)
Year ended 12-31-2019			4.83			0.09			0.59				0.68				(0.10	)			(0.26	)			(0.36	)
Year ended 12-31-2018			5.16			0.10			(0.20	)			(0.10	)			(0.06	)			(0.17	)			(0.23	)
Year ended 12-31-2017			4.90			0.05			0.46				0.51				(0.04	)			(0.21	)			(0.25	)
Year ended 12-31-2016			5.15			0.04			0.09				0.13				(0.06	)			(0.32	)			(0.38	)
Year ended 12-31-2015			5.54			0.06			(0.03	)			0.03				(0.06	)			(0.36	)			(0.42	)
Pathfinder Moderate
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			5.19			0.10			(0.19	)			(0.09	)			(0.09	)			(0.56	)			(0.65	)
Year ended 12-31-2019			4.89			0.08			0.79				0.87				(0.14	)			(0.43	)			(0.57	)
Year ended 12-31-2018			5.40			0.12			(0.31	)			(0.19	)			(0.08	)			(0.24	)			(0.32	)
Year ended 12-31-2017			5.02			0.07			0.64				0.71				(0.04	)			(0.29	)			(0.33	)
Year ended 12-31-2016			5.34			0.04			0.13				0.17				(0.07	)			(0.42	)			(0.49	)
Year ended 12-31-2015			5.87			0.07			(0.02	)			0.05				(0.10	)			(0.48	)			(0.58	)
Pathfinder Moderately Aggressive
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			5.32			0.10			(0.26	)			(0.16	)			(0.09	)			(0.67	)			(0.76	)
Year ended 12-31-2019			4.98			0.08			0.92				1.00				(0.15	)			(0.51	)			(0.66	)
Year ended 12-31-2018			5.59			0.13			(0.37	)			(0.24	)			(0.10	)			(0.27	)			(0.37	)
Year ended 12-31-2017			5.14			0.09			0.74				0.83				(0.05	)			(0.33	)			(0.38	)
Year ended 12-31-2016			5.50			0.04			0.17				0.21				(0.09	)			(0.48	)			(0.57	)
Year ended 12-31-2015			6.14			0.09			(0.06	)			0.03				(0.14	)			(0.53	)			(0.67	)
Pathfinder Moderately Conservative
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			5.22			0.10			(0.13	)			(0.03	)			(0.10	)			(0.46	)			(0.56	)
Year ended 12-31-2019			4.90			0.08			0.70				0.78				(0.12	)			(0.34	)			(0.46	)
Year ended 12-31-2018			5.32			0.11			(0.24	)			(0.13	)			(0.07	)			(0.22	)			(0.29	)
Year ended 12-31-2017			4.99			0.06			0.56				0.62				(0.04	)			(0.25	)			(0.29	)
Year ended 12-31-2016			5.30			0.04			0.10				0.14				(0.07	)			(0.38	)			(0.45	)
Year ended 12-31-2015			5.80			0.07			(0.03	)			0.04				(0.09	)			(0.45	)			(0.54	)

(1) Based on average weekly shares outstanding.

(2) Based on net asset value. Total returns do not reflect a sales charge or contingent sales charge, if applicable. Total returns for periods less than one year are not annualized.

(3) Ratios excluding expense waivers are included only for periods in which the class had waived or reimbursed expenses.

(4) Does not include expenses of underlying VIP Portfolios in which the Portfolio invests.

(5) Annualized.

    .

20 SEMIANNUAL REPORT 2020

	Net Asset Value, End of Period			Total Return(2)			Net Assets, End of Period (in millions)			Ratio of Expenses to Average Net Assets Including Expense Waiver			Ratio of Net Investment Income to Average Net Assets Including Expense Waiver			Ratio of Expenses to Average Net Assets Excluding Expense Waiver(3)			Ratio of Net Investment Income (Loss) to Average Net Assets Excluding Expense Waiver(3)			Portfolio Turnover Rate
Pathfinder Aggressive
Class II Shares
Six-month period ended 6-30-2020 (unaudited)		$	4.11		-3.27	%		$	59		0.13	%(4)(5)		4.06	%(4)(5)		—	%		—	%		19	%
Year ended 12-31-2019			5.00		23.24				66		0.09	(4)		1.41	(4)		—			—			18
Year ended 12-31-2018			4.60		-4.27				59		0.09	(4)		2.49	(4)		—			—			51
Year ended 12-31-2017			5.16		19.83				76		0.07	(4)		1.68	(4)		—			—			20
Year ended 12-31-2016			4.68		4.80				75		0.08	(4)		0.88	(4)		—			—			23
Year ended 12-31-2015			5.05		0.34				85		0.07	(4)		1.36	(4)		—			—			13
Pathfinder Conservative
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			4.76		0.90				96		0.09	(4)(5)		4.41	(4)(5)		—			—			23
Year ended 12-31-2019			5.15		14.66				99		0.07	(4)		1.71	(4)		—			—			31
Year ended 12-31-2018			4.83		-1.93				94		0.07	(4)		1.89	(4)		—			—			39
Year ended 12-31-2017			5.16		10.51				109		0.06	(4)		1.06	(4)		—			—			30
Year ended 12-31-2016			4.90		2.84				114		0.07	(4)		0.71	(4)		—			—			26
Year ended 12-31-2015			5.15		0.45				117		0.06	(4)		1.09	(4)		—			—			17
Pathfinder Moderate
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			4.45		-1.15				614		0.04	(4)(5)		4.22	(4)(5)		—			—			18
Year ended 12-31-2019			5.19		19.05				680		0.04	(4)		1.62	(4)		—			—			17
Year ended 12-31-2018			4.89		-3.90				703		0.03	(4)		2.26	(4)		—			—			36
Year ended 12-31-2017			5.40		14.70				877		0.03	(4)		1.30	(4)		—			—			22
Year ended 12-31-2016			5.02		3.65				860		0.03	(4)		0.78	(4)		—			—			19
Year ended 12-31-2015			5.34		0.32				893		0.03	(4)		1.22	(4)		—			—			13
Pathfinder Moderately Aggressive
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			4.40		-2.21				740		0.04	(4)(5)		4.16	(4)(5)		—			—			16
Year ended 12-31-2019			5.32		21.40				829		0.03	(4)		1.56	(4)		—			—			19
Year ended 12-31-2018			4.98		-4.71				838		0.03	(4)		2.35	(4)		—			—			39
Year ended 12-31-2017			5.59		16.72				1,052		0.03	(4)		1.66	(4)		—			—			20
Year ended 12-31-2016			5.14		4.52				1,020		0.04	(4)		0.85	(4)		—			—			17
Year ended 12-31-2015			5.50		0.06				1,054		0.03	(4)		1.50	(4)		—			—			12
Pathfinder Moderately Conservative
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			4.63		-0.13				185		0.06	(4)(5)		4.31	(4)(5)		—			—			19
Year ended 12-31-2019			5.22		16.85				202		0.05	(4)		1.67	(4)		—			—			18
Year ended 12-31-2018			4.90		-2.67				205		0.05	(4)		2.07	(4)		—			—			34
Year ended 12-31-2017			5.32		12.77				251		0.05	(4)		1.22	(4)		—			—			24
Year ended 12-31-2016			4.99		3.10				261		0.05	(4)		0.80	(4)		—			—			16
Year ended 12-31-2015			5.30		0.33				272		0.04	(4)		1.20	(4)		—			—			16

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 21

FINANCIAL HIGHLIGHTS IVY VIP

FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD

	Net Asset Value, Beginning of Period			Net Investment Income(1)				Net Realized and Unrealized Gain (Loss) on Investments				Total from Investment Operations				Distributions From Net Investment Income				Distributions From Net Realized Gains				Total Distributions
Pathfinder Moderate – Managed Volatility
Class II Shares
Six-month period ended 6-30-2020 (unaudited)		$	5.84		$	0.11			$	(0.36	)		$	(0.25	)		$	(0.08	)		$	(0.43	)		$	(0.51	)
Year ended 12-31-2019			5.33			0.08				0.82				0.90				(0.11	)			(0.28	)			(0.39	)
Year ended 12-31-2018			5.78			0.11				(0.33	)			(0.22	)			(0.06	)			(0.17	)			(0.23	)
Year ended 12-31-2017			5.25			0.06				0.65				0.71				(0.03	)			(0.15	)			(0.18	)
Year ended 12-31-2016			5.37			0.03				0.06				0.09				(0.03	)			(0.18	)			(0.21	)
Year ended 12-31-2015			5.39			0.05				(0.07	)			(0.02	)			—				—				—
Pathfinder Moderately Aggressive –Managed Volatility
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			5.63			0.10				(0.41	)			(0.31	)			(0.07	)			(0.52	)			(0.59	)
Year ended 12-31-2019			5.15			0.07				0.88				0.95				(0.12	)			(0.35	)			(0.47	)
Year ended 12-31-2018			5.66			0.11				(0.37	)			(0.26	)			(0.07	)			(0.18	)			(0.25	)
Year ended 12-31-2017			5.06			0.07				0.71				0.78				(0.02	)			(0.16	)			(0.18	)
Year ended 12-31-2016			5.25			0.03				0.09				0.12				(0.05	)			(0.26	)			(0.31	)
Year ended 12-31-2015			5.29			0.06				(0.10	)			(0.04	)			—				—				—
Pathfinder Moderately Conservative – Managed Volatility
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			5.58			0.10				(0.20	)			(0.10	)			(0.08	)			(0.34	)			(0.42	)
Year ended 12-31-2019			5.19			0.08				0.66				0.74				(0.10	)			(0.25	)			(0.35	)
Year ended 12-31-2018			5.55			0.10				(0.24	)			(0.14	)			(0.05	)			(0.17	)			(0.22	)
Year ended 12-31-2017			5.10			0.05				0.53				0.58				(0.02	)			(0.11	)			(0.13	)
Year ended 12-31-2016			5.23			0.02				0.04				0.06				(0.03	)			(0.16	)			(0.19	)
Year ended 12-31-2015			5.27			0.04				(0.07	)			(0.03	)			—				(0.01	)			(0.01	)
Government Money Market
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			1.00			0.00	*			0.00				0.00	*			—	*			—				—	*
Year ended 12-31-2019			1.00			0.02				0.00				0.02				(0.02	)			—	*			(0.02	)
Year ended 12-31-2018			1.00			0.02				0.00	*			0.02				(0.02	)			—	*			(0.02	)
Year ended 12-31-2017			1.00			0.01				0.00	*			0.01				(0.01	)			—	*			(0.01	)
Year ended 12-31-2016			1.00			0.00	*			0.00	*			0.00	*			—	*			—	*			—	*
Year ended 12-31-2015			1.00			0.00	*			0.00	*			0.00	*			—	*			—				—	*

* Not shown due to rounding.

(1) Based on average weekly shares outstanding.

(2) Based on net asset value. Total returns do not reflect a sales charge or contingent sales charge, if applicable. Total returns for periods less than one year are not annualized.

(3) Ratios excluding expense waivers are included only for periods in which the class had waived or reimbursed expenses.

(4) Does not include expenses of underlying VIP Portfolios in which the Portfolio invests.

(5) Annualized.

    .

22 SEMIANNUAL REPORT 2020

	Net Asset Value, End of Period			Total Return(2)			Net Assets, End of Period (in millions)			Ratio of Expenses to Average Net Assets Including Expense Waiver			Ratio of Net Investment Income to Average Net Assets Including Expense Waiver			Ratio of Expenses to Average Net Assets Excluding Expense Waiver(3)			Ratio of Net Investment Income (Loss) to Average Net Assets Excluding Expense Waiver(3)			Portfolio Turnover Rate
Pathfinder Moderate – Managed Volatility
Class II Shares
Six-month period ended 6-30-2020 (unaudited)		$	5.08		-3.81	%		$	664		0.23	%(4)(5)		3.91	%(4)(5)		—	%		—	%		37	%
Year ended 12-31-2019			5.84		17.32				707		0.23	(4)		1.39	(4)		—			—			9
Year ended 12-31-2018			5.33		-4.00				606		0.23	(4)		2.00	(4)		—			—			28
Year ended 12-31-2017			5.78		13.80				600		0.23	(4)		1.07	(4)		—			—			21
Year ended 12-31-2016			5.25		1.81				511		0.24	(4)		0.55	(4)		—			—			14
Year ended 12-31-2015			5.37		-0.43				396		0.24	(4)		0.88	(4)		—			—			7
Pathfinder Moderately Aggressive – Managed Volatility
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			4.73		-4.96				86		0.31	(4)(5)		3.78	(4)(5)		—			—			35
Year ended 12-31-2019			5.63		19.29				93		0.27	(4)		1.32	(4)		—			—			16
Year ended 12-31-2018			5.15		-4.75				84		0.27	(4)		2.04	(4)		—			—			37
Year ended 12-31-2017			5.66		15.70				92		0.27	(4)		1.38	(4)		—			—			19
Year ended 12-31-2016			5.06		2.36				78		0.31	(4)		0.56	(4)		—			—			12
Year ended 12-31-2015			5.25		-0.71				67		0.30	(4)		1.13	(4)		—			—			7
Pathfinder Moderately Conservative – Managed Volatility
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			5.06		-1.63				79		0.32	(4)(5)		3.97	(4)(5)		—			—			35
Year ended 12-31-2019			5.58		14.89				80		0.27	(4)		1.45	(4)		—			—			14
Year ended 12-31-2018			5.19		-2.90				73		0.29	(4)		1.79	(4)		—			—			28
Year ended 12-31-2017			5.55		11.84				74		0.27	(4)		0.96	(4)		—			—			26
Year ended 12-31-2016			5.10		1.21				67		0.30	(4)		0.49	(4)		—			—			11
Year ended 12-31-2015			5.23		-0.52				54		0.30	(4)		0.78	(4)		—			—			9
Government Money Market
Class II Shares
Six-month period ended 6-30-2020 (unaudited)			1.00		0.37				146		0.40	(5)		0.80	(5)		0.43	(5)		0.77	(5)		—
Year ended 12-31-2019			1.00		1.83				184		0.42			1.82			—			—			—
Year ended 12-31-2018			1.00		1.53				239		0.40			1.49			—			—			—
Year ended 12-31-2017			1.00		0.59				317		0.41			0.56			0.42			0.55			—
Year ended 12-31-2016			1.00		0.13				414		0.45			0.13			0.46			0.12			—
Year ended 12-31-2015			1.00		0.02				539		0.20			0.02			0.45			-0.23			—

See Accompanying Notes to Financial Statements.

2020 SEMIANNUAL REPORT 23

NOTES TO FINANCIAL STATEMENTS IVY VIP

JUNE 30, 2020 (UNAUDITED)

1. ORGANIZATION

Ivy Variable Insurance Portfolios, a Delaware statutory trust (the “Trust”), is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. Pathfinder Aggressive, Pathfinder Conservative, Pathfinder Moderate, Pathfinder Moderately Aggressive and Pathfinder Moderately Conservative (collectively, the “Pathfinder Portfolios”), Pathfinder Moderate – Managed Volatility, Pathfinder Moderately Aggressive – Managed Volatility and Pathfinder Moderately Conservative – Managed Volatility (collectively, the “Managed Volatility Portfolios”) and Government Money Market (each, a “Portfolio”) are nine series of the Trust and are the only series of the Trust included in the financial statements. The assets belonging to Government Money Market are held separately by the custodian. The assets belonging to each Pathfinder Portfolio and Managed Volatility Portfolio are held separately by the transfer agent for the underlying funds and the custodian. The investment objective, policies and risk factors of each Portfolio are described more fully in the Prospectus and Statement of Additional Information (“SAI”). Each Portfolio’s investment adviser is Ivy Investment Management Company (“IICO”).

2. SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies consistently followed by each Portfolio.

Security Transactions and Related Investment Income. Security transactions are accounted for on the trade date (date the order to buy or sell is executed). Realized gains and losses are calculated on the identified cost basis. Interest income is recorded on the accrual basis and includes paydown gain (loss) and accretion of discounts and amortization of premiums. Dividend income is recorded on the ex-dividend date, except certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Portfolio is informed of the ex-dividend date. All or a portion of the distributions received from a real estate investment trust or publicly traded partnership may be designated as a reduction of cost of the related investment or realized gain. Income or short-term capital gain distributions received from registered investment companies, if any, are recorded as dividend income. Long-term capital gain distributions received from registered investment companies, if any, are recorded as realized gains.

Foreign Currency Translation. Each Portfolio’s accounting records are maintained in U.S. dollars. All assets and liabilities denominated in foreign currencies are translated into U.S. dollars daily, using foreign exchange rates obtained from an independent pricing service approved by the Board of Trustees of the Trust (the “Board”). Purchases and sales of investment securities and accruals of income and expenses are translated at the rate of exchange prevailing on the date of the transaction. For assets and liabilities other than investments in securities, net realized and unrealized gains and losses from foreign currency translation arise from changes in currency exchange rates. Each Portfolio combines fluctuations from currency exchange rates and fluctuations in value when computing net realized gain (loss) and net change in unrealized appreciation (depreciation) on investments. Foreign exchange rates are typically valued as of the close of the New York Stock Exchange (“NYSE”), normally 4:00 P.M. Eastern time, on each day the NYSE is open for trading.

Dividends and Distributions to Shareholders. Dividends and distributions to shareholders are recorded by each Portfolio on the business day following record date. Net investment income dividends and capital gains distributions are determined in accordance with income tax regulations which may differ from accounting principles generally accepted in the United States of America (“U.S. GAAP”). If the total dividends and distributions made in any tax year exceeds net investment income and accumulated realized capital gains, a portion of the total distribution may be treated as a tax return of capital.

Income Taxes. It is the policy of each Portfolio to distribute all of its taxable income and capital gains to its shareholders and to otherwise qualify as a regulated investment company under Subchapter M of the Internal Revenue Code. In addition, each Portfolio intends to pay distributions as required to avoid imposition of excise tax. Accordingly, no provision has been made for Federal income taxes. The Portfolios file income tax returns in U.S. federal and applicable state jurisdictions. The Portfolios’ tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years after the filing of the tax returns. Management of the Trust periodically reviews all tax positions to assess whether it is more likely than not that the position would be sustained upon examination by the relevant tax authority based on the technical merits of each position. As of the date of these financial statements, management believes that no liability for unrecognized tax positions is required.

Segregation and Collateralization. In cases in which the 1940 Act and the interpretive positions of the Securities and Exchange Commission (“SEC”), the Dodd Frank Wall Street Reform and Consumer Protection Act, or the interpretive rules and regulations of the U.S. Commodities Futures Trading Commission require that a Portfolio either deliver collateral or segregate assets in connection with certain investments (e.g., dollar rolls, financial futures contracts, foreign currency exchange contracts, options written, securities with extended settlement periods, and swaps), the Portfolio will segregate collateral or designate on its books and records, cash or other liquid securities having a value at least equal to the amount that is required to be physically segregated for the benefit of the counterparty. Furthermore, based on requirements and

24 SEMIANNUAL REPORT 2020

agreements with certain exchanges and third party broker-dealers, each party has requirements to deliver/deposit cash or securities as collateral for certain investments. Certain countries require that cash reserves be held while investing in companies incorporated in that country. These cash reserves and cash collateral that has been pledged to cover obligations of the Portfolios under derivative contracts, if any, will be reported separately on the Statement of Assets and Liabilities as “Restricted cash”. Securities collateral pledged for the same purpose, if any, is noted on the Schedule of Investments.

Concentration of Market and Credit Risk. Because each Pathfinder Portfolio and Managed Volatility Portfolio invests substantially all of its assets in Ivy Variable Insurance Portfolios mutual funds (“Underlying Funds”), the risks associated with investing in the Portfolios are closely related to the risks associated with the securities and other investments held by the Underlying Funds.

In the normal course of business, Government Money Market and the Underlying Funds may invest in securities and enter into transactions where risks exist due to fluctuations in the market (market risk) or failure of the issuer of a security to meet all its obligations (issuer credit risk). The value of securities held by Government Money Market and the Underlying Funds may decline in response to certain events, including those directly involving the issuers whose securities are owned by the Underlying Funds; conditions affecting the general economy; overall market changes; local, regional or global political, social or economic instability; and currency and interest rate and price fluctuations. Similar to issuer credit risk, Government Money Market and the Underlying Funds may be exposed to counterparty credit risk, or the risk that an entity with which Government Money Market or the Underlying Funds have unsettled or open transactions may fail to or be unable to perform on its commitments. Government Money Market and the Underlying Funds manage counterparty credit risk by entering into transactions only with counterparties that they believe have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties. Financial assets, which potentially expose the Underlying Funds to market, issuer and counterparty credit risks, consist principally of financial instruments and receivables due from counterparties.

Certain Underlying Funds may hold high-yield or non-investment-grade bonds, that may be subject to a greater degree of credit risk. Credit risk relates to the ability of the issuer to meet interest or principal payments or both as they become due. The Underlying Funds may acquire securities in default and are not obligated to dispose of securities whose issuers subsequently default.

Certain Underlying Funds may enter into financial instrument transactions (such as swaps, futures, options and other derivatives) that may have off-balance sheet market risk. Off-balance sheet market risk exists when the maximum potential loss on a particular financial instrument is greater than the value of such financial instrument.

If an Underlying Fund invests directly in foreign currencies or in securities that trade in, and receive revenues in, foreign currencies, or in financial derivatives that provide exposure to foreign currencies, it will be subject to the risk that those currencies will decline in value relative to the base currency of the Underlying Funds, or, in the case of hedging positions, that the Underlying Fund’s base currency will decline in value relative to the currency being hedged. Currency rates in foreign countries may fluctuate significantly over short periods of time for a number of reasons, including changes in interest rates, intervention (or the failure to intervene) by U.S. or foreign governments, central banks or supranational entities such as the International Monetary Fund, or by the imposition of currency controls or other political developments in the United States or abroad.

The London Interbank Offered Rate “LIBOR” is an indicative measure of the average interest rate at which major global banks could borrow from one another. LIBOR is quoted in multiple currencies and multiple time frames using data reported by private-sector banks. LIBOR is used extensively in the United States and globally as a “benchmark” or “reference rate” for various commercial and financial contracts, including corporate and municipal bonds and loans, floating rate mortgages, asset-backed securities, consumer loans, and interest rate swaps and other derivatives.

It is expected that a number of private-sector banks currently reporting information used to set LIBOR will stop doing so after 2021 when their current reporting commitment ends, which could either cause LIBOR to stop publication immediately or cause LIBOR’s regulator to determine that its quality has degraded to the degree that it is no longer representative of its underlying market.

Management believes that, with respect to any significant investments by a Portfolio or Underlying Fund in instruments linked to LIBOR, the impact on investments and discontinuation of LIBOR may represent a significant risk.

However, management acknowledges that the anticipated transition away from LIBOR will occur after 2021 and certain of the current investments will mature prior to that time. Furthermore, the ways in which LIBOR’s discontinuation potentially could impact an Underlying Fund’s investments is not fully known. The extent of that impact may vary depending on various factors, which include, but are not limited to: (i) existing fallback or termination provisions in individual contracts and (ii) whether, how, and when industry participants develop and adopt new successor reference rates and/or fallbacks for both legacy and new instruments.

2020 SEMIANNUAL REPORT 25

In addition, the transition to a successor rate could potentially cause (i) increased volatility or illiquidity in markets for instruments that currently rely on LIBOR, (ii) a reduction in the value of certain instruments held by an Underlying Fund, or (iii) reduced effectiveness of related Underlying Fund transactions, such as hedging.

As the impacts of the transition become clearer during the next year, Management will be evaluating the impacts of these changes.

An outbreak of infectious respiratory illness caused by a novel coronavirus known as COVID-19 was first detected in China in December 2019 and has now been detected globally. This coronavirus has resulted in travel restrictions, closed international borders, enhanced health screenings at ports of entry and elsewhere, disruption of and delays in healthcare service preparation and delivery, prolonged quarantines, cancellations, supply chain disruptions, and lower consumer demand, as well as general concern and uncertainty. The impact of COVID-19, and other infectious illness outbreaks that may arise in the future, could adversely affect the economies of many nations or the entire global economy, individual issuers and capital markets in ways that cannot necessarily be foreseen. In addition, the impact of infectious illnesses in emerging market countries may be greater due to generally less established healthcare systems. Public health crises caused by the COVID-19 outbreak may exacerbate other pre-existing political, social and economic risks in certain countries or globally. The duration of the COVID-19 outbreak and its effects cannot be determined with certainty.

The individual Portfolios herein have adopted a Liquidity Risk Management Program (the “Program”). The Portfolio’s board has designated a Liquidity Risk Management Committee (the “Committee”) as the administrator of the Program. The Committee or delegates of the Committee conduct the day-to-day operation of the Program. Under the Program, the Committee manages the Portfolio’s liquidity risk, which is the risk that any Portfolio could not meet shareholder redemption requests without significant dilution of remaining shareholders’ interests in the Portfolio. This risk is managed by monitoring the degree of liquidity of the Portfolio’s investments, limiting the amount of the Portfolio’s illiquid investments, and utilizing various risk management tools and facilities available to the Portfolio for meeting shareholder redemptions, among other means. The Committee’s process of determining the degree of liquidity of the Portfolio’s investments is supported by one or more third-party liquidity assessment vendors. The Portfolio’s board reviewed a report prepared by a designee of the Committee regarding the operation, adequacy and effectiveness of the Program from the period June 1, 2019, through March 31, 2020. The report described the Program’s liquidity classification methodology and the methodology in establishing a Portfolio’s Highly Liquid Investment Minimum (“HLIM”), if necessary. The Committee reported that during the period covered by the report, there were no material changes to the Program and no significant liquidity events impacting the Portfolio or its ability to timely meet redemptions without dilution to existing shareholders. In addition, the Committee provided its assessment that the Program, including the operation of each Portfolio’s HLIM, where applicable, had been effective in managing the Portfolio’s liquidity risk.

Custodian Fees. “Custodian fees” on the Statement of Operations may include interest expense incurred by a Portfolio on any cash overdrafts of its custodian account during the period. Such cash overdrafts may result from the effects of failed trades in portfolio securities and from cash outflows resulting from unanticipated shareholder redemption activity. A Portfolio pays interest to its custodian on such cash overdrafts, to the extent they are not offset by positive cash balances maintained by that Portfolio. The “Earnings credit” line item, if shown, represents earnings on cash balances maintained by that Portfolio during the period. Such interest expense and other custodian fees may be paid with these earnings.

Indemnification. The Trust’s organizational documents provide current and former Trustees and Officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Trust. In the normal course of business, the Trust may also enter into contracts that provide general indemnification. The Trust’s maximum exposure under these arrangements is unknown and is dependent on future claims that may be made against the Trust. The risk of material loss from such claims is considered remote.

Basis of Preparation. Each Portfolio is an investment company and follows accounting and reporting guidance in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Topic 946 (“ASC 946”). The accompanying financial statements were prepared in accordance with U.S. GAAP, including but not limited to ASC 946. U.S. GAAP requires the use of estimates made by management. Management believes that estimates and valuations are appropriate; however, actual results may differ from those estimates, and the valuations reflected in the accompanying financial statements may differ from the value ultimately realized upon sale or maturity.

Subsequent Events. Management has performed a review for subsequent events through the date this report was issued.

3. INVESTMENT VALUATION AND FAIR VALUE MEASUREMENTS

Investments in affiliated mutual funds within the Ivy Variable Insurance Portfolios family are valued at their Net Asset Value (“NAV”) as reported by the Underlying Funds. Investments in Government Money Market are valued on the basis of amortized cost (which approximates value), whereby a portfolio security is valued at its cost initially, and thereafter valued to reflect a constant amortization to maturity of any discount or premium. Short-term securities with maturities of 60 days or less held in all Portfolios (with the exception of Government Money Market) are valued based on quotes that are obtained from an independent pricing service approved by the Board.

26 SEMIANNUAL REPORT 2020

Fair value is defined as the price that each Portfolio would receive upon selling an asset or would pay upon satisfying a liability in an orderly transaction between market participants at the measurement date. For purposes of calculating the NAV, the portfolio securities are valued on each business day using pricing and valuation methods as adopted by the Board. Where market quotes are readily available, fair value is generally determined on the basis of the last reported sales price, or if no sales are reported, based on quotes obtained from a quotation reporting system, established market makers, or pricing services.

Accounting standards establish a framework for measuring fair value and a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability. Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the reporting entity’s own assumptions about the factors that market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.

An individual investment’s fair value measurement is assigned a level based upon the observability of the inputs which are significant to the overall valuation.

The three-tier hierarchy of inputs is summarized as follows:

• Level 1 – Observable inputs such as quoted prices, available in active markets, for identical assets or liabilities.

• Level 2 – Significant other observable inputs, which may include, but are not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market corroborated inputs.

• Level 3 – Significant unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available, which may include assumptions made by the Board or persons acting at its direction that are used in determining the fair value of investments.

A description of the valuation techniques applied to the Portfolios’ major classes of assets and liabilities measured at fair value on a recurring basis follows:

Derivative Instruments. Exchange-traded futures contracts are generally valued at the settlement price.

Listed derivatives that are actively traded are valued based on quoted prices from the exchange and are categorized in Level 1 of the fair value hierarchy. OTC derivative contracts include forward foreign currency contracts, swap agreements, and option contracts related to interest rates, foreign currencies, credit standing of reference entities, equity prices, or commodity prices. Depending on the product and the terms of the transaction, the fair value of the OTC derivative products are modeled taking into account the counterparties’ creditworthiness and using a series of techniques, including simulation models. Many pricing models do not entail material subjectivity because the methodologies employed do not necessitate significant judgments and the pricing inputs are observed from actively quoted markets, as is the case with interest rate swap and option contracts. OTC derivative products valued using pricing models with significant observable inputs are categorized within Level 2 of the fair value hierarchy.

Equity Securities. Investments in registered open-end investment management companies will be valued based upon the NAV of such investments and are categorized as Level 1 of the fair value hierarchy.

Overdraft due to custodian. Due to the short-term nature of overdraft due to custodian, the carrying value approximates fair value and the liability is categorized as Level 2 in the fair value hierarchy.

Short-term Investments. Short-term investments having a maturity of 60 days or less are valued based on quotes that are obtained from an independent pricing service authorized by the Board. These investments are categorized as Level 2 of the fair value hierarchy.

4. DERIVATIVE INSTRUMENTS ($ amounts in thousands unless indicated otherwise)

The following disclosures contain information on why and how the Portfolios use derivative instruments, the associated risks of investing in derivative instruments, and how derivative instruments affect the Portfolios’ financial positions and results of operations.

Futures Contracts. Each Managed Volatility Portfolio is authorized to engage in buying and selling futures contracts. Upon entering into a futures contract, a Portfolio is required to deposit, in a segregated account, an amount equal to a varying specified percentage of the contract amount. This amount is known as the initial margin. Subsequent amounts, known as variation margin, are paid or received by the Portfolio each day, dependent on the daily fluctuations in the value of the underlying debt security or index. Options on futures contracts may also be purchased or sold by a Portfolio.

2020 SEMIANNUAL REPORT 27

Futures contracts are reported on a schedule following the Schedule of Investments. Securities held in collateralized accounts to cover initial margin requirements on open futures contracts are identified on the Schedule of Investments. Cash held by the broker to cover initial margin requirements on open futures contracts and the receivable and/or payable for the daily mark to market for the variation margin are noted on the Statement of Assets and Liabilities. The net change in unrealized appreciation (depreciation) is reported on the Statement of Operations. Realized gains (losses) are reported on the Statement of Operations at the closing or expiration of futures contracts.

Risks of entering into futures contracts include the possibility of loss of securities or cash held as collateral, that there may be an illiquid market where the Portfolio is unable to close the contract or enter into an offsetting position and, if used for hedging purposes, the risk that the price of the contract will correlate imperfectly with the prices of the Portfolio’s securities.

Pathfinder Moderate – Managed Volatility, Pathfinder Moderately Aggressive – Managed Volatility and Pathfinder Moderately Conservative – Managed Volatility invest in long and/or short positions in futures contracts to gain exposure to, or economically hedge against, changes in the value of equity securities (equity risk).

Additional Disclosure Related to Derivative Instruments

Fair values of derivative instruments as of June 30, 2020:

		Assets			Liabilities
Portfolio	Type of Risk Exposure	Statement of Assets & Liabilities Location	Value		Statement of Assets & Liabilities Location	Value
Pathfinder Moderate – Managed Volatility	Equity	Unrealized appreciation on futures contracts*	$	605		$	—
Pathfinder Moderately Aggressive – Managed Volatility	Equity	Unrealized appreciation on futures contracts*		73			—
Pathfinder Moderately Conservative – Managed Volatility	Equity	Unrealized appreciation on futures contracts*		128			—

* The value presented includes cumulative gain (loss) on open futures contracts; however, the value reflected on the accompanying Statement of Assets and Liabilities is only the unsettled variation margin receivable (payable) as of June 30, 2020.

Amount of realized gain (loss) on derivatives recognized on the Statement of Operations for the period ended June 30, 2020:

		Net realized gain (loss) on:
Portfolio	Type of Risk Exposure	Investments in unaffiliated securities*		Swap agreements		Futures contracts			Written options		Forward foreign currency contracts		Total
Pathfinder Moderate – Managed Volatility	Equity	$	—	$	—	$	(20,629	)	$	—	$	—	$	(20,629	)
Pathfinder Moderately Aggressive – Managed Volatility	Equity		—		—		(2,620	)		—		—		(2,620	)
Pathfinder Moderately Conservative – Managed Volatility	Equity		—		—		(1,605	)		—		—		(1,605	)

* Purchased options are reported as investments in unaffiliated securities and are reflected on the accompanying Schedule of Investments.

Change in unrealized appreciation (depreciation) on derivatives recognized on the Statement of Operations for the period ended June 30, 2020:

		Net change in unrealized appreciation (depreciation) on:
Portfolio	Type of Risk Exposure	Investments in unaffiliated securities*		Swap agreements		Futures contracts		Written options		Forward foreign currency contracts		Total
Pathfinder Moderate – Managed Volatility	Equity	$	—	$	—	$	1,184	$	—	$	—	$	1,184
Pathfinder Moderately Aggressive – Managed Volatility	Equity		—		—		140		—		—		140
Pathfinder Moderately Conservative – Managed Volatility	Equity		—		—		195		—		—		195

* Purchased options are reported as investments in unaffiliated securities and are reflected on the accompanying Schedule of Investments.

28 SEMIANNUAL REPORT 2020

During the period ended June 30, 2020, the average derivative volume was as follows:

Portfolio	Forward foreign currency contracts(1)	Long futures contracts(2)		Short futures contracts(2)		Swap agreements(3)		Purchased options(2)		Written options(2)
Pathfinder Moderate – Managed Volatility	$	$	—	$	97,120	$	—	$	—	$	—
Pathfinder Moderately Aggressive – Managed Volatility	—		124		12,345		—		—		—
Pathfinder Moderately Conservative – Managed Volatility	—		1,783		11,914		—		—		—

(1) Average absolute value of unrealized appreciation/depreciation during the period.

(2) Average value outstanding during the period.

(3) Average notional amount outstanding during the period.

5. INVESTMENT MANAGEMENT AND PAYMENTS TO AFFILIATED PERSONS ($ amounts in thousands unless indicated otherwise)

Management Fees. IICO serves as each Portfolio’s investment adviser. The management fee is accrued daily by Government Money Market at the following annual rates as a percentage of average daily net assets:

Portfolio (M – Millions)	$0 to $1,000M		Over $1,000M
Government Money Market		0.350		0.300

Each Managed Volatility Portfolio pays a management fee to IICO for providing investment advice and supervising its investments at the following annual rates as a percentage of average daily net assets:

Portfolio (M – Millions)	$0 to $500M			$500 to $1,000M			Over $1,000M
Pathfinder Moderate – Managed Volatility		0.200	%		0.170	%		0.150	%
Pathfinder Moderately Aggressive – Managed Volatility		0.200			0.170			0.150
Pathfinder Moderately Conservative – Managed Volatility		0.200			0.170			0.150

IICO uses all of the management fee it receives from the Managed Volatility Portfolios to pay Securian Asset Management Inc. (“Securian”). Accordingly, Securian receives a fee based on the average daily net assets of the Managed Volatility Portfolios.

The Pathfinder Portfolios pay no management fees; however, IICO receives management fees from the underlying funds.

IICO has entered into Subadvisory Agreements with the following entity on behalf of certain Portfolios:

Securian serves as subadvisor to the Managed Volatility Portfolios. The subadvisor makes investment decisions in accordance with the Portfolio’s investment objectives, policies and restrictions under the supervision of IICO and the Board of Trustees. IICO pays all applicable costs of the subadvisor.

Independent Trustees and Chief Compliance Officer Fees. Fees paid to the Independent Trustees can be paid in cash or deferred to a later date, at the election of the Trustees according to the Deferred Fee Agreement entered into between the Trust and the Trustee(s). Each Portfolio records its portion of the deferred fees as a liability on the Statement of Assets and Liabilities. All fees paid in cash plus any appreciation (depreciation) in the underlying deferred plan are shown on the Statement of Operations. Additionally, fees paid to the Chief Compliance Officer of the Portfolios are shown on the Statement of Operations.

Accounting Services Fees. The Trust has an Accounting and Administrative Services Agreement with Waddell & Reed Services Company (“WRSCO”), doing business as WI Services Company (“WISC”). Under the agreement, WISC acts as the agent in providing bookkeeping and accounting services and assistance to the Trust, including maintenance of Portfolio records, pricing of Portfolio shares and preparation of certain shareholder reports. For these services Government Money Market pays WISC a monthly fee of one-twelfth of the annual fee based on the average net asset levels shown in the following table:

(M – Millions)	$0 to $10M		$10 to $25M		$25 to $50M		$50 to $100M		$100 to $200M		$200 to $350M		$350 to $550M		$550 to $750M		$750 to $1,000M		Over $1,000M
Annual Fee Rate	$	0.00	$	11.50	$	23.10	$	35.50	$	48.40	$	63.20	$	82.50	$	96.30	$	121.60	$	148.50

2020 SEMIANNUAL REPORT 29

Under the Accounting Services Agreement, each Pathfinder Portfolio and Managed Volatility Portfolio pays WISC a monthly fee of one-twelfth of the annual fee shown in the following table:

(M – Millions)	$0 to $10M		$10 to $25M		$25 to $50M		$50 to $100M		$100 to $200M		$200 to $350M		$350 to $550M		$550 to $750M		$750 to $1,000M		Over $1,000M
Annual Fee Rate	$	0.00	$	5.75	$	11.55	$	17.75	$	24.20	$	31.60	$	41.25	$	48.15	$	60.80	$	74.25

Each Portfolio also pays WISC a monthly administrative fee at the annual rate of 0.01%, or one basis point, for the first $1 billion of net assets with no fee charged for net assets in excess of $1 billion. This fee is voluntarily waived by WISC until a Portfolio’s net assets are at least $10 million and is included in “Accounting services fee” on the Statement of Operations.

Shareholder Servicing. Under the Transfer Agency Agreement between the Trust and WISC, each Portfolio reimburses WISC for certain out-of-pocket costs.

Expense Reimbursements and/or Waivers. IICO, the Portfolios’ investment manager, has determined to voluntarily waive and/or reimburse sufficient expenses of Government Money Market to the extent necessary to maintain a yield of not less than zero. There is no guarantee that Class II of Government Money Market Fund will maintain such a yield. IICO may amend or terminate this voluntary waiver and/or reimbursement at any time without prior notice to shareholders. Government Money Market class expense limitations and related waivers/reimbursements for the period ended June 30, 2020 were as follows:

Portfolio Name	Share Class Name	Type of Expense Limit	Commencement Date	End Date	Expense Limit	Amount of Expense Waiver/ Reimbursement	Expense Reduced
Government Money Market	Class II	Voluntary	N/A	N/A	To maintain minimum yield	$29	Investment Management Fees and/or Shareholder Servicing

Any amounts due to the Portfolios as a reimbursement but not paid as of June 30, 2020 are shown as a receivable from affiliates on the Statement of Assets and Liabilities.

6. INTERFUND LENDING PROGRAM

Pursuant to an exemptive order issued by the SEC (“Order”), the Ivy Funds, Ivy Variable Insurance Portfolios and InvestEd Portfolios (collectively, the “Funds” only for purposes of this footnote 6) have the ability to lend money to, and borrow money from, each other pursuant to a master interfund lending agreement (“Interfund Lending Program”). Under the Interfund Lending Program, the Funds may lend or borrow money for temporary purposes directly to or from one another (each an “Interfund Loan”), subject to meeting the conditions of the Order. The interest rate to be charged on an Interfund Loan is the average of the overnight repurchase agreement rate and the short-term bank loan rate. The Funds made no Interfund Loans under the Interfund Lending Program during the period ended June 30, 2020.

7. AFFILIATED COMPANY TRANSACTIONS (All amounts in thousands)

A summary of the transactions in affiliated companies during the period ended June 30, 2020 follows:

	12-31-19 Value			Gross Additions			Gross Reductions			Realized Gain/(Loss)				Net Change in Unrealized Appreciation/ (Depreciation)				6-30-20 Value			Distributions Received			Capital Gain Distributions
Pathfinder Aggressive
Ivy VIP Core Equity, Class II		$	8,842		$	781		$	1,150		$	33			$	(668	)		$	7,838		$	119		$	373
Ivy VIP Corporate Bond, Class II			5,896			1,580			1,161			73				111				6,499			156			–
Ivy VIP Global Equity Income, Class II			7,851			2,187			909			49				(1,338	)			7,840			223			–
Ivy VIP Growth, Class II			8,952			2,516			1,158			84				(633	)			9,761			161			1,165
Ivy VIP High Income, Class I			323			26			180			(10	)			(13	)			146			11			–
Ivy VIP International Core Equity, Class II			11,721			1,059			1,780			42				(1,473	)			9,569			248			2
Ivy VIP Limited-Term Bond, Class II			4,595			559			2,201			72				(43	)			2,982			79			–
Ivy VIP Mid Cap Growth, Class I			6,379			613			1,445			280				(78	)			5,749			67			375
Ivy VIP Small Cap Core, Class II			828			142			86			4				(177	)			711			10			32
Ivy VIP Small Cap Growth, Class I			1,671			125			304			13				(6	)			1,499			–			–
Ivy VIP Value, Class II			8,690			1,502			1,777			(24	)			(1,933	)			6,458			172			271
		$	65,748								$	616			$	(6,251	)		$	59,052		$	1,246		$	2,218

30 SEMIANNUAL REPORT 2020

	12-31-19 Value			Gross Additions			Gross Reductions			Realized Gain/(Loss)				Net Change in Unrealized Appreciation/ (Depreciation)				6-30-20 Value			Distributions Received			Capital Gain Distributions
Pathfinder Conservative
Ivy VIP Core Equity, Class II		$	8,365		$	1,490		$	1,365		$	31			$	(644	)		$	7,877		$	122		$	381
Ivy VIP Corporate Bond, Class II			18,661			5,699			2,748			180				453				22,245			541			–
Ivy VIP Global Equity Income, Class II			3,977			1,592			691			21				(679	)			4,220			122			–
Ivy VIP Government Money Market, Class II			8,639			1,319			3,239			–				–				6,719			29			–
Ivy VIP Growth, Class II			8,472			3,076			1,151			72				(618	)			9,851			166			1,198
Ivy VIP High Income, Class I			1,474			293			414			(8	)			(164	)			1,181			93			–
Ivy VIP International Core Equity, Class II			5,937			1,098			1,167			21				(738	)			5,151			135			1
Ivy VIP Limited-Term Bond, Class II			26,285			4,537			6,772			153				(91	)			24,112			646			–
Ivy VIP Mid Cap Growth, Class I			6,620			1,396			1,922			233				22				6,349			76			421
Ivy VIP Small Cap Core, Class II			254			73			44			(1	)			(53	)			229			3			11
Ivy VIP Small Cap Growth, Class I			1,524			282			373			21				(3	)			1,451			–			–
Ivy VIP Value, Class II			8,223			2,478			2,001			21				(1,927	)			6,794			184			291
		$	98,431								$	744			$	(4,442	)		$	96,179		$	2,117		$	2,303
	12-31-19 Value			Gross Additions			Gross Reductions			Realized Gain/(Loss)				Net Change in Unrealized Appreciation/ (Depreciation)				6-30-20 Value			Distributions Received			Capital Gain Distributions
Pathfinder Moderate
Ivy VIP Core Equity, Class II		$	74,751		$	5,464		$	9,182		$	88			$	(5,406	)		$	65,715		$	1,003		$	3,132
Ivy VIP Corporate Bond, Class II			94,712			18,484			14,605			913				2,113				101,617			2,438			–
Ivy VIP Global Equity Income, Class II			54,513			15,424			7,024			225				(9,111	)			54,027			1,538			–
Ivy VIP Government Money Market, Class II			36,306			3,401			15,149			–				–				24,558			115			–
Ivy VIP Growth, Class II			75,699			18,155			7,311			634				(5,204	)			81,973			1,360			9,810
Ivy VIP High Income, Class I			6,732			685			2,204			(130	)			(549	)			4,534			351			–
Ivy VIP International Core Equity, Class II			81,384			7,391			13,023			(180	)			(9,626	)			65,946			1,710			13
Ivy VIP Limited-Term Bond, Class II			107,267			12,643			27,678			564				(262	)			92,534			2,442			–
Ivy VIP Mid Cap Growth, Class I			55,941			5,835			13,579			2,106				(272	)			50,031			587			3,269
Ivy VIP Small Cap Core, Class II			5,183			940			646			(57	)			(1,016	)			4,404			59			200
Ivy VIP Small Cap Growth, Class I			13,931			1,154			2,779			98				(13	)			12,391			–			–
Ivy VIP Value, Class II			73,454			13,725			15,619			34				(16,466	)			55,128			1,469			2,322
		$	679,873								$	4,295			$	(45,812	)		$	612,858		$	13,072		$	18,746
	12-31-19 Value			Gross Additions			Gross Reductions			Realized Gain/(Loss)				Net Change in Unrealized Appreciation/ (Depreciation)				6-30-20 Value			Distributions Received			Capital Gain Distributions
Pathfinder Moderately Aggressive
Ivy VIP Core Equity, Class II		$	101,226		$	6,491		$	11,960		$	62			$	(7,259	)		$	88,560		$	1,337		$	4,177
Ivy VIP Corporate Bond, Class II			98,711			14,335			16,242			1,018				2,147				99,969			2,375			–
Ivy VIP Global Equity Income, Class II			82,676			22,220			9,884			347				(13,826	)			81,533			2,298			–
Ivy VIP Government Money Market, Class II			30,144			2,549			16,024			–				–				16,669			90			–
Ivy VIP Growth, Class II			102,502			24,972			10,972			970				(7,121	)			110,351			1,812			13,067
Ivy VIP High Income, Class I			6,132			555			2,489			(147	)			(403	)			3,648			280			–
Ivy VIP International Core Equity, Class II			123,429			10,056			19,021			(623	)			(14,322	)			99,519			2,553			20
Ivy VIP Limited-Term Bond, Class II			81,987			11,171			18,889			271				(101	)			74,439			1,945			–
Ivy VIP Mid Cap Growth, Class I			74,252			6,716			17,225			2,717				(405	)			66,055			767			4,271
Ivy VIP Small Cap Core, Class II			8,375			1,394			945			(75	)			(1,656	)			7,093			95			318
Ivy VIP Small Cap Growth, Class I			19,011			1,328			3,589			95				(14	)			16,831			–			–
Ivy VIP Value, Class II			99,473			16,922			20,646			(240	)			(21,920	)			73,589			1,940			3,067
		$	827,918								$	4,395			$	(64,880	)		$	738,256		$	15,492		$	24,920

2020 SEMIANNUAL REPORT 31

	12-31-19 Value			Gross Additions			Gross Reductions			Realized Gain/(Loss)				Net Change in Unrealized Appreciation/ (Depreciation)				6-30-20 Value			Distributions Received			Capital Gain Distributions
Pathfinder Moderately Conservative
Ivy VIP Core Equity, Class II		$	19,638		$	1,860		$	2,602		$	38			$	(1,435	)		$	17,499		$	270		$	843
Ivy VIP Corporate Bond, Class II			32,110			8,694			4,604			296				738				37,234			903			–
Ivy VIP Global Equity Income, Class II			12,156			3,719			1,684			47				(2,028	)			12,210			351			–
Ivy VIP Government Money Market, Class II			14,197			1,312			5,792			–				–				9,717			45			–
Ivy VIP Growth, Class II			19,888			5,209			2,029			154				(1,369	)			21,853			366			2,644
Ivy VIP High Income, Class I			2,500			300			706			(42	)			(229	)			1,823			143			–
Ivy VIP International Core Equity, Class II			18,149			1,958			3,029			(118	)			(2,056	)			14,904			391			3
Ivy VIP Limited-Term Bond, Class II			43,724			4,908			11,573			258				(123	)			37,194			992			–
Ivy VIP Mid Cap Growth, Class I			15,062			1,903			3,826			585				(62	)			13,662			162			902
Ivy VIP Small Cap Core, Class II			1,029			210			140			(11	)			(203	)			885			12			41
Ivy VIP Small Cap Growth, Class I			3,624			375			762			33				(3	)			3,267			–			–
Ivy VIP Value, Class II			19,300			4,090			4,186			43				(4,386	)			14,861			400			633
		$	201,377								$	1,283			$	(11,156	)		$	185,109		$	4,035		$	5,066
	12-31-19 Value			Gross Additions			Gross Reductions			Realized Gain/(Loss)				Net Change in Unrealized Appreciation/ (Depreciation)				6-30-20 Value			Distributions Received			Capital Gain Distributions
Pathfinder Moderate – Managed Volatility
Ivy VIP Core Equity, Class II		$	75,930		$	19,149		$	21,275		$	989			$	(6,058	)		$	68,735		$	1,044		$	3,261
Ivy VIP Corporate Bond, Class II			96,210			39,657			32,441			1,837				971				106,234			2,537			–
Ivy VIP Global Equity Income, Class II			55,446			27,161			17,313			568				(9,345	)			56,517			1,602			–
Ivy VIP Government Money Market, Class II			36,995			8,654			19,972			–				–				25,677			119			–
Ivy VIP Growth, Class II			76,894			33,564			20,481			1,405				(5,665	)			85,717			1,412			10,189
Ivy VIP High Income, Class I			6,879			1,680			3,089			(163	)			(565	)			4,742			366			–
Ivy VIP International Core Equity, Class II			82,775			26,449			31,336			763				(9,667	)			68,984			1,780			14
Ivy VIP Limited-Term Bond, Class II			109,238			32,129			44,704			1,164				(1,082	)			96,745			2,542			–
Ivy VIP Mid Cap Growth, Class I			56,810			16,016			22,692			3,282				(1,097	)			52,319			611			3,402
Ivy VIP Small Cap Core, Class II			5,279			1,912			1,497			31				(1,116	)			4,609			62			208
Ivy VIP Small Cap Growth, Class I			14,154			3,672			5,031			230				(65	)			12,960			–			–
Ivy VIP Value, Class II			74,645			27,624			28,102			671				(17,155	)			57,683			1,534			2,426
		$	691,255								$	10,777			$	(50,844	)		$	640,922		$	13,609		$	19,500
	12-31-19 Value			Gross Additions			Gross Reductions			Realized Gain/(Loss)				Net Change in Unrealized Appreciation/ (Depreciation)				6-30-20 Value			Distributions Received			Capital Gain Distributions
Pathfinder Moderately Aggressive – Managed Volatility
Ivy VIP Core Equity, Class II		$	11,170		$	2,611		$	2,990		$	85			$	(842	)		$	10,034		$	151		$	470
Ivy VIP Corporate Bond, Class II			10,897			3,707			3,592			195				115				11,322			267			–
Ivy VIP Global Equity Income, Class II			9,131			4,234			2,676			69				(1,520	)			9,238			258			–
Ivy VIP Government Money Market, Class II			3,321			651			2,084			–				–				1,888			10			–
Ivy VIP Growth, Class II			11,311			4,880			3,054			205				(842	)			12,500			203			1,466
Ivy VIP High Income, Class I			680			142			345			(21	)			(43	)			413			32			–
Ivy VIP International Core Equity, Class II			13,632			3,284			4,016			48				(1,672	)			11,276			287			2
Ivy VIP Limited-Term Bond, Class II			9,079			2,840			3,492			46				(42	)			8,431			219			–
Ivy VIP Mid Cap Growth, Class I			8,193			2,120			3,109			373				(94	)			7,483			86			480
Ivy VIP Small Cap Core, Class II			925			315			244			3				(195	)			804			11			36
Ivy VIP Small Cap Growth, Class I			2,098			498			705			25				(9	)			1,907			–			–
Ivy VIP Value, Class II			10,980			3,755			3,976			45				(2,465	)			8,339			219			346
		$	91,417								$	1,073			$	(7,609	)		$	83,635		$	1,743		$	2,800

32 SEMIANNUAL REPORT 2020

	12-31-19 Value			Gross Additions			Gross Reductions			Realized Gain/(Loss)				Net Change in Unrealized Appreciation/ (Depreciation)				6-30-20 Value			Distributions Received			Capital Gain Distributions
Pathfinder Moderately Conservative – Managed Volatility
Ivy VIP Core Equity, Class II		$	7,649		$	2,008		$	2,010		$	128			$	(596	)		$	7,179		$	111		$	345
Ivy VIP Corporate Bond, Class II			12,506			6,157			3,800			195				211				15,269			370			–
Ivy VIP Global Equity Income, Class II			4,740			2,373			1,382			86				(807	)			5,010			144			–
Ivy VIP Government Money Market, Class II			5,560			1,255			2,830			–				–				3,985			18			–
Ivy VIP Growth, Class II			7,747			3,511			1,901			147				(540	)			8,964			150			1,081
Ivy VIP High Income, Class I			980			260			383			(12	)			(98	)			747			58			–
Ivy VIP International Core Equity, Class II			7,076			1,873			2,048			122				(908	)			6,115			160			1
Ivy VIP Limited-Term Bond, Class II			17,048			4,730			6,559			197				(164	)			15,252			406			–
Ivy VIP Mid Cap Growth, Class I			5,866			1,716			2,277			339				(40	)			5,604			66			369
Ivy VIP Small Cap Core, Class II			403			148			108			5				(85	)			363			5			17
Ivy VIP Small Cap Growth, Class I			1,412			376			483			40				(5	)			1,340			–			–
Ivy VIP Value, Class II			7,519			2,885			2,671			138				(1,772	)			6,099			164			260
		$	78,506								$	1,385			$	(4,804	)		$	75,927		$	1,652		$	2,073

8. INVESTMENT SECURITIES TRANSACTIONS ($ amounts in thousands)

The cost of purchases and the proceeds from maturities and sales of investment securities (excluding short-term securities) for the period ended June 30, 2020, were as follows:

	Purchases						Sales
	U.S. Government			Other Issuers			U.S. Government			Other Issuers
Pathfinder Aggressive		$	—		$	11,090		$	—		$	12,151
Pathfinder Conservative			—			23,333			—			21,887
Pathfinder Moderate			—			103,301			—			128,799
Pathfinder Moderately Aggressive			—			118,709			—			147,886
Pathfinder Moderately Conservative			—			34,538			—			40,933
Pathfinder Moderate – Managed Volatility			—			237,667			—			247,933
Pathfinder Moderately Aggressive – Managed Volatility			—			29,037			—			30,283
Pathfinder Moderately Conservative – Managed Volatility			—			27,292			—			26,452
Government Money Market			—			—			—			—

9. CAPITAL SHARE TRANSACTIONS (All amounts in thousands)

The Trust has authorized an unlimited number of no par value shares of beneficial interest. Transactions in shares of beneficial interest were as follows:

	Pathfinder Aggressive												Pathfinder Conservative
	Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19						Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19
	Shares			Value			Shares			Value			Shares			Value			Shares			Value
Shares issued from sale of shares:
Class II		264		$	1,152			904		$	4,399			1,729		$	8,635			2,758		$	13,757
Shares issued in reinvestment of distributions to shareholders:
Class II		2,257			8,769			1,655			7,374			1,740			7,982			1,443			6,905
Shares redeemed:
Class II		(1,281	)		(5,655	)		(2,113	)		(10,275	)		(2,387	)		(11,716	)		(4,383	)		(21,949	)
Net increase (decrease)		1,240		$	4,266			446		$	1,498			1,082		$	4,901			(182	)	$	(1,287	)

2020 SEMIANNUAL REPORT 33

	Pathfinder Moderate												Pathfinder Moderately Aggressive
	Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19						Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19
	Shares			Value			Shares			Value			Shares			Value			Shares			Value
Shares issued from sale of shares:
Class II		74		$	349			183		$	932			416		$	1,946			411		$	2,138
Shares issued in reinvestment of distributions to shareholders:
Class II		18,744			79,595			16,016			75,614			26,250			109,757			21,454			102,589
Shares redeemed:
Class II		(11,780	)		(56,830	)		(29,129	)		(147,204	)		(14,491	)		(71,122	)		(34,231	)		(176,746	)
Net increase (decrease)		7,038		$	23,114			(12,930	)	$	(70,658	)		12,175		$	40,581			(12,366	)	$	(72,019	)
	Pathfinder Moderately Conservative												Pathfinder Moderate – Managed Volatility
	Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19						Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19
	Shares			Value			Shares			Value			Shares			Value			Shares			Value
Shares issued from sale of shares:
Class II		205		$	1,013			617		$	3,094			591		$	3,231			5,714		$	32,066
Shares issued in reinvestment of distributions to shareholders:
Class II		4,529			20,114			3,846			18,438			12,381			60,610			8,200			43,825
Shares redeemed:
Class II		(3,371	)		(16,598	)		(7,714	)		(39,130	)		(3,475	)		(18,887	)		(6,337	)		(35,718	)
Net increase (decrease)		1,363		$	4,529			(3,251	)	$	(17,598	)		9,497		$	44,954			7,577		$	40,173
	Pathfinder Moderately Aggressive – Managed Volatility												Pathfinder Moderately Conservative – Managed Volatility
	Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19						Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19
	Shares			Value			Shares			Value			Shares			Value			Shares			Value
Shares issued from sale of shares:
Class II		633		$	3,154			915		$	4,945			745		$	3,854			1,302		$	7,038
Shares issued in reinvestment of distributions to shareholders:
Class II		2,141			9,697			1,483			7,558			1,234			6,043			950			4,908
Shares redeemed:
Class II		(1,162	)		(5,856	)		(2,123	)		(11,437	)		(793	)		(4,154	)		(1,885	)		(10,192	)
Net increase		1,612		$	6,995			275		$	1,066			1,186		$	5,743			367		$	1,754
	Government Money Market
	Six months ended 6-30-20 (Unaudited)						Year ended 12-31-19
	Shares			Value			Shares			Value
Shares issued from sale of shares:
Class II		44,744		$	44,744			54,880		$	54,880
Shares issued in reinvestment of distributions to shareholders:
Class II		609			609			3,958			3,958
Shares redeemed:
Class II		(83,321	)		(83,321	)		(113,724	)		(113,724	)
Net decrease		(37,968	)	$	(37,968	)		(54,886	)	$	(54,886	)

34 SEMIANNUAL REPORT 2020

10. FEDERAL INCOME TAX MATTERS ($ amounts in thousands)

For Federal income tax purposes, cost of investments owned at June 30, 2020 and the related unrealized appreciation (depreciation) were as follows:

Portfolio	Cost of Investments		Gross Appreciation		Gross Depreciation		Net Unrealized Depreciation
Pathfinder Aggressive	$	69,092	$	1,226	$	10,878	$	(9,652	)
Pathfinder Conservative		102,269		1,581		7,573		(5,992	)
Pathfinder Moderate		677,462		10,736		75,340		(64,604	)
Pathfinder Moderately Aggressive		832,978		13,521		107,539		(94,018	)
Pathfinder Moderately Conservative		200,947		3,303		18,995		(15,692	)
Pathfinder Moderate – Managed Volatility		716,815		11,171		69,778		(58,607	)
Pathfinder Moderately Aggressive – Managed Volatility		96,566		1,415		12,778		(11,363	)
Pathfinder Moderately Conservative – Managed Volatility		83,609		1,409		7,145		(5,736	)
Government Money Market		146,123		—		—		—

For Federal income tax purposes, the Portfolios’ undistributed earnings and profit for the year ended December 31, 2019 and the post-October and late-year ordinary activity updated with information available through the date of this report were as follows:

Portfolio	Undistributed Ordinary Income			Undistributed Long-Term Capital Gains			Tax Return of Capital			Post- October Capital Losses Deferred			Late-Year Ordinary Losses Deferred
Pathfinder Aggressive		$	1,186		$	7,577		$	—		$	—		$	—
Pathfinder Conservative			2,096			5,881			—			—			—
Pathfinder Moderate			14,424			65,145			—			—			—
Pathfinder Moderately Aggressive			17,237			92,499			—			—			—
Pathfinder Moderately Conservative			4,260			15,849			—			—			—
Pathfinder Moderate – Managed Volatility			9,288			51,310			—			—			—
Pathfinder Moderately Aggressive – Managed Volatility			1,199			8,494			—			—			—
Pathfinder Moderately Conservative – Managed Volatility			1,131			4,908			—			—			—
Government Money Market			49			—			—			—			—

Internal Revenue Code regulations permit each Portfolio to elect to defer into its next fiscal year capital losses and certain specified ordinary items incurred between each November 1 and the end of its fiscal year. Each Portfolio is also permitted to defer into its next fiscal certain ordinary losses that generated between each January 1 and the end of its fiscal year.

The tax character of dividends and distributions paid during the two fiscal years ended December 31, 2019 and 2018 were as follows:

	December 31, 2019						December 31, 2018
Portfolio	Distributed Ordinary Income(1)			Distributed Long-Term Capital Gains			Distributed Ordinary Income(1)			Distributed Long-Term Capital Gains
Pathfinder Aggressive		$	1,922		$	5,452		$	1,675		$	3,392
Pathfinder Conservative			2,143			4,762			1,750			2,972
Pathfinder Moderate			19,550			56,065			15,410			33,109
Pathfinder Moderately Aggressive			24,441			78,148			24,003			41,725
Pathfinder Moderately Conservative			5,005			13,433			4,186			8,769
Pathfinder Moderate – Managed Volatility			12,479			31,346			8,544			15,759
Pathfinder Moderately Aggressive – Managed Volatility			2,045			5,513			1,570			2,492
Pathfinder Moderately Conservative – Managed Volatility			1,340			3,568			1,057			1,819
Government Money Market			3,948			16			4,344			—

(1) Includes short-term capital gains distributed, if any.

Dividends from net investment income and short-term capital gains are treated as ordinary income dividends for federal income tax purposes.

2020 SEMIANNUAL REPORT 35

PROXY VOTING INFORMATION IVY VIP

(UNAUDITED)

Proxy Voting Guidelines

A description of the policies and procedures Ivy Variable Insurance Portfolios uses to determine how to vote proxies relating to portfolio securities is available (i) without charge, upon request, by calling 1.888.923.3355 and (ii) on the Securities and Exchange Commission’s (“SEC”) website at www.sec.gov.

Proxy Voting Records

Information regarding how the Portfolio voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on Form N-PX at www.ivyinvestments.com and on the SEC’s website at www.sec.gov.

36 SEMIANNUAL REPORT 2020

QUARTERLY PORTFOLIO SCHEDULE INFORMATION IVY VIP

(UNAUDITED)

Portfolio holdings can be found on the Trust’s website at www.ivyinvestments.com. Alternatively, a complete schedule of portfolio holdings of each Portfolio for the first and third quarters of each fiscal year is filed with the SEC and can be found on the Trust’s Form N-Q and/or Form NPORT-EX. These holdings may be viewed in the following ways:

• On the SEC’s website at www.sec.gov.

• For review and copy at the SEC’s Public Reference Room in Washington, DC. Information on the operations of the Public Reference Room may be obtained by calling 1.800.SEC.0330.

2020 SEMIANNUAL REPORT 37

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38 SEMIANNUAL REPORT 2020

THE IVY VARIABLE INSURANCE PORTFOLIOS FAMILY

Global/International Portfolios

Global Equity Income

Global Growth

International Core Equity

Domestic Equity Portfolios

Core Equity

Growth

Mid Cap Growth

Small Cap Core

Small Cap Growth

Value

Fixed Income Portfolios

Corporate Bond

Global Bond

High Income

Limited-Term Bond

Money Market Portfolio

Government Money Market

Specialty Portfolios

Asset Strategy

Balanced

Energy

Natural Resources

Pathfinder Aggressive

Pathfinder Conservative

Pathfinder Moderate

Pathfinder Moderately Aggressive

Pathfinder Moderately Conservative

Pathfinder Moderate – Managed Volatility

Pathfinder Moderately Aggressive – Managed Volatility

Pathfinder Moderately Conservative – Managed Volatility

Science and Technology

Securian Real Estate Securities

The underlying portfolios discussed in this report are only available as investment options in variable annuity and variable life insurance contracts issued by life insurance companies. They are not offered or made available directly to the general public.

This report is submitted for the general information of the shareholders of Ivy Variable Insurance Portfolios. It is not authorized for distribution to prospective investors in a Portfolio unless accompanied with or preceded by the current Portfolio prospectus as well as the variable product prospectus.

2020 SEMIANNUAL REPORT 39

SEMIANN-VIP-PF (06/20)

ITEM 2. CODE OF ETHICS

Required in annual report only.

ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT

Required in annual report only.

ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

Required in annual report only.

ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS

Not applicable.

ITEM 6. SCHEDULE OF INVESTMENTS.

See Item 1 Shareholder Report.

ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES

Not applicable.

ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS

Not applicable.

ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

There have been no material changes to the procedures by which shareholders may recommend nominees to the Registrant’s board of directors.

ITEM 11. CONTROLS AND PROCEDURES.

(a) The Registrant’s Principal Executive Officer and Principal Financial Officer, or persons performing similar functions, based on their evaluation of the Registrant’s disclosure controls and procedures as of a date within 90 days of the filing date of this report, have concluded that such controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended) are effective and adequately designed to ensure that information required to be disclosed by the Registrant in its reports that it files or submits is accumulated and communicated to the Registrant’s management, including the Principal Executive Officer and Principal Financial Officer, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.

(b) There were no significant changes in the registrant’s internal controls over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940, as amended) that occurred during the registrant’s second fiscal half-year that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

ITEM 12. DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

ITEM 13. EXHIBITS.

(a)(1) Required in annual report only.

(a)(2) A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)).

Attached hereto as Exhibit 99.CERT.

(b) A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(b) under the Investment Company Act of 1940 (17 CFR 270.30a-2(b)).

Attached hereto as Exhibit 99.906CERT.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

IVY VARIABLE INSURANCE PORTFOLIOS

(Registrant)

By	/s/ Jennifer K. Dulski
	Jennifer K. Dulski, Secretary
Date:	September 2, 2020

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By	/s/ Philip J. Sanders
	Philip J. Sanders, Principal Executive Officer
Date:	September 2, 2020
By	/s/ Joseph W. Kauten
	Joseph W. Kauten, Principal Financial Officer
Date:	September 2, 2020