ncsrcombinedpart2.htm - Generated by SEC Publisher for SEC Filing

GLOBAL INVESTMENT MANAGEMENT •ASSET ALLOCATION EXPERTISE •RETIREMENT LEADERSHIP

Major changes have been under way for most of 2014. Perhaps the largest economic change has been the phase-out of quantitative easing by the U.S. Federal Reserve (the Fed), removing monetary stimulus from the economy by bringing its asset purchase program to a close. Global markets have been shaken throughout the year by a seemingly endless string of geopolitical pressures including tensions in the Ukraine, the ongoing ISIS war, and the Ebola crisis in Africa. These events have had a relatively minor impact on global economics, but they have been unsettling for investors.

One beneficiary of this uncertainty has been the U.S., which again is viewed as a safe haven in an uncertain world. The year began with speculation about rapidly rising interest rates; however, interest rates went the opposite direction, falling to 2.34% on October 31, 2014.¹Inflationary pressures have been absent and the Consumer Price Index (CPI) rate has remained fairly stable at 1.7% through September.²Unemployment hit a post-recession low of 5.9% in October.¹The Fed continues to monitor inflation and unemployment as it contemplates raising short-term interest rates.

The Eurozone has seen slow growth for the past 12 months, causing the European Central Bank to ease monetary policy. The same story is playing out in Japan, and to a lesser degree in China, where soft economies have paved the way for easier monetary policies. This has contributed to a significant rally in the value of the U.S. dollar of 6.2% since the end of June.³A rising dollar means, among other things, that goods imported to the U.S. are less expensive.

Because markets tend to fluctuate, we believe the most prudent approach for investing your portfolio is to select an allocation that is broadly diversified both across and within asset classes.⁴We encourage you to work with your financial professional in choosing investments and monitoring your portfolio’s performance as you work toward realizing your financial goals.

Our mutual funds cover a wide range of asset classes to help you diversify your portfolio as you save for the future—whether you are investing for goals that are years down the road, or closer at hand. You can select a mix of our individual funds, or you can choose one of our asset allocation funds (which are already broadly diversified).

Whatever your financial goals, we have a wide range of mutual funds to help you succeed.

Investors have experienced some unsettling factors during the 12-month period that ended October 31, 2014 including geopolitical pressures, cautionary events around the world, and the phase-out of quantitative easing in the United States. One beneficiary to this global uncertainty has been that the U.S. is again viewed as an economic safe haven in an uncertain world.

In the U.S., the Federal Reserve (the Fed) has undergone a gradual tapering of its bond purchases from a high of $85 billion per month to zero as of October 2014. Although the year began with speculation about rapidly rising interest rates as a result of the Fed removing monetary stimulus from the economy, the markets have reacted oppositely. Interest rates have fallen from a high of 3.04% at year-end to 2.34% on October 31.¹

Part of the reason for the fall in rates has been the absence of inflationary pressures in the United States. The lack of inflation also has its roots in the slowdown in growth internationally. Eurozone growth has fallen to 0.1% and inflation is running at 0.4%.²This has been a significant concern for the European Central Bank, which has eased monetary policy twice in the past six months, and is considering its own quantitative easing facility. One result has been that the dollar has rallied 6.2% since the end of June, resulting in importing deflation, as the goods purchased overseas come at a cheaper price.³Soft economies in Japan and China have paved the way for easier monetary policies in those countries.

One interesting side effect of this is the divergence between unemployment and the level of inflation. While inflation has

Aside from the impact of Fed policy, the U.S. has been able to show steady growth. Third quarter gross domestic product (GDP) was reported to rise at a 3.5% annualized pace. This came on the heels of a second quarter pace of 4.6% for GDP.⁴Primary drivers of the pace of the expansion were increases in personal consumption and business investment. Both the University of Michigan’s Consumer Sentiment Index and the Purchasing Manager’s Index (PMI) hint at continued expansion. The University of Michigan’s survey showed that consumers are at their most confident in seven years, and while off its highs the PMI also shows continued strength, especially in new orders, which expanded for the 16^thconsecutive month.

What contributed to or detracted from Fund performance during the fiscal year?

The Principal Bond & Mortgage Securities Fund outperformed the Barclays Capital Aggregate Index, driven by positive security selection and sector allocation. An out of index allocation to below investment grade corporate bonds, as well as security selection within mortgage-backed securities (MBS), investment grade corporate bonds, commercial mortgage-backed securities (CMBS), and asset-backed securities (ABS) contributed. Underweight positions to U.S. Treasury securities and agencies, along with over weights to investment grade corporate bonds and CMBS contributed to performance. Duration positioning detracted, as the portfolio was short duration relative to the index during times of declining interest rates. Yield curve positioning also detracted, with underperformance driven by underweights at the five and twenty-year key rate duration points. Security selection within emerging markets and U.S. Treasury securities, as well as an underweight to MBS, detracted. Derivatives were used during the year to tactically hedge exposures, primarily in emerging market securities and below investment grade corporate bonds. These positions helped mitigate losses during periods of increased volatility and spread widening.

Investment results shown represent historical performance and do not guarantee future results. Your investment’s returns and principal values will fluctuate with changes in interest rates and other market conditions so the value, when redeemed, may be worth more or less than original costs. Current performance may be lower or higher than the performance shown. For more information, including the most recent month-end performance, visit principalfunds.com, call your financial professional, or call 800-222-5852.

A sales charge may apply as follows: Class A shares: maximum up-front sales charge of 3.75%; Class B shares: contingent deferred sales charge of 5%, which will decline over 5 years (5-5-4-3-2-0%); Class C shares: contingent deferred sales charge of 1% on redemptions made during the first 12 months. See the prospectus for details. Performance listed with sales charge reflects the maximum sales charge.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15. Returns displayed are based on net total investment expense.

* Performance assumes reinvestment of all dividends and capital gains. Extended performance is calculated based on the historical performance of the Fund’s oldest share class, adjusted for the fees and expenses of the share class shown. Performance does not reflect the impact of federal, state, or municipal taxes. If it did, performance would be lower.

What contributed to or detracted from Fund performance during the fiscal year?

Overweight to general obligation paper, which has benefited from the state's rebound and ratings upgrade, contributed to Fund performance. The essential services sector also contributed to performance. The carry trade also continued to prosper with the large disparity between the back and front end of the curve. Not being long duration detracted from Fund performance. The lack of additional risk in the portfolio hindered returns. Underweight to tobacco also detracted from performance.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15. Returns displayed are based on net total investment expense.

* Performance assumes reinvestment of all dividends and capital gains. Performance does not reflect the impact of federal, state, or municipal taxes. If it did, performance would be lower.

What contributed to or detracted from Fund performance during the fiscal year?

Stock selection in Canada contributed, led by Alimentation Couche-Tard due to better than expected first-quarter earnings per share (EPS) and an unexpected increase in the quarterly dividend as a result of better than expected fuel margins and strong gross margins in Europe. Shire Pharmaceutical contributed due to better than expected third-quarter EPS as a result of existing product sales growth and efficiencies from cost restructuring. Overweight to Coloplast in the health care sector contributed due to strong fourth-quarter EPS results, driven by lower expenses. Stock selection in Japan detracted. Exposure to the financial group, Orix, detracted as a result of geopolitical risks and global risk aversion weighing on the stock. Exposure to Greece detracted, driven by an overweight to Alpha Bank, which underperformed amid political concerns and concerns about the pace of the European recovery. Stock selection in Hong Kong also detracted from performance, led by Sands China, which underperformed as Macau VIP and mass travel slowed and has negatively impacted industry revenue.

A sales charge may apply as follows: Class A shares: maximum up-front sales charge of 5.50%; Class B shares: contingent deferred sales charge of 5%, which will decline over 5 years (5-5-4-3-2-0%); Class C shares: contingent deferred sales charge of 1% on redemptions made during the first 12 months. Class P shares do not have a sales charge. See the prospectus for details. Performance listed with sales charge reflects the maximum sales charge.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15. Returns displayed are based on net total investment expense.

invest directly in an index. The Fund’s primary benchmark changed from the MSCI EAFE NTDR D Index to the MSCI ACWI Ex-U.S. Index because the MSCI ACWI Ex-U.S. Index more closely aligns with the Fund’s investments in developed and emerging markets than the MSCI EAFE NDTR D Index.

What contributed to or detracted from Fund performance during the fiscal year?

Allocation to Lockheed Martin, a defense company, continued to outpace the broader Industrial sector, aiding performance. Selection within and allocation to the financial sector aided performance, led by Digital Realty Trust. Allocation to Kroger Co., a consumer staples company, aided results as it gained momentum after beating earnings expectations. Selection within the consumer discretionary sector hindered performance, led by Mattel, Inc., which underperformed due to continued disappointing sales in the doll category and concerns about growth in the toy industry. Within the information technology sector, underweight to Intel detracted from performance as the company outperformed. Allocation to GlaxoSmithKline within the health care sector underperformed due to concerns over patent expirations and a soft near-term new product pipeline.

What contributed to or detracted from Fund performance during the fiscal year?

From an asset allocation perspective, an overweight to the master limited partnerships (MLPs) (sleeve managed by Tortoise Capital Advisors) contributed the most. An underweight to high yield (sleeves managed by DDJ Capital Management and Guggenheim Investment Management) also contributed. From a manager perspective, outperformance by the commercial mortgage-backed securities (CMBS) sleeve (managed by Principal Global Investors) contributed the most due to positive security selection driven by Junior AAA (AJ) classes and legacy credit. Outperformance by the high yield sleeves and infrastructure sleeves (managed by Colonial First State Asset Management and Reaves Asset Management) also aided performance. From an asset allocation perspective, underweight to global value equity (managed by Principal Global Investors) and commercial mortgage-backed securities (CMBS) detracted. From a manager perspective, the emerging market debt sleeve (managed by Stone Harbor Investment Partners) was the only sleeve that detracted, led by an overweight to Venezuela.

A sales charge may apply as follows: Class A shares: maximum up-front sales charge of 3.75%; Class C shares: contingent deferred sales charge of 1% on redemptions made during the first 12 months. Class P shares do not have a sales charge. See the prospectus for details. Performance listed with sales charge reflects the maximum sales charge.

*** Performance shown for the benchmark is calculated from 12/31/08 and assumes reinvestment of all dividends and distributions. Indices are unmanaged, and individuals cannot invest directly in an index. The Global Diversified Income Custom Index is composed of 26% Barclays U.S. Corporate High Yield 2% Issuer Capped Index; 20% blend of 75% J.P. Morgan EMBI Global Diversified Index and 25% BofA Merrill Lynch European Currency Non-Financial High Yield 2% Constrained Index; 17% Barclays Investment Grade CMBS Index; 12% blend of 85% MSCI All Country World Value Index NR and 15% MSCI ACWI Value SMID Index NR; 11% blend of 59% S&P Global Infrastructure Index and 41% blend of 10% S&P 500 Energy Index, 25% S&P 500 Telecom Services Index, and 65% S&P 500 Utilities Index; 5% blend of 50% BofA Merrill Lynch Fixed Rate Preferred Securities Index and 50% BofA Merrill Lynch U.S. Capital Securities Index; 5% Tortoise Midstream MLP Index; and 4% FTSE EPRA/NAREIT Developed Index.

What contributed to or detracted from Fund performance during the fiscal year?

A large overweight to Pebblebrook Hotels contributed due to the majority of the company's hotel assets being located in thriving U.S. West Coast markets as well as the completion of successful acquisitions. Stock selection within Japan was a top contributor, led by lack of allocation to Sumitomo Realty and Development, whose relatively higher leverage makes it more sensitive to inflation expectations than peers. An overweight to U.S. mall owner Simon Property Group contributed as it delivered robust internal growth resulting from rising occupancy levels and solid lease spreads. Unfavorable stock selection within France detracted, led by an overweight position in Icade, a French diversified property owner. Overweights to Klepierre and Accor also detracted. Overweight to Agile Property Holdings detracted due to investor concerns on its high gearing, slow cash collection and sluggish sales amidst weaker sentiment for the Chinese developers. Underweight to Digital Realty Trust detracted.

A sales charge may apply as follows: Class A shares: maximum up-front sales charge of 5.50%; Class C shares: contingent deferred sales charge of 1% on redemptions made during the first 12 months. Class P shares do not have a sales charge. See the prospectus for details. Performance listed with sales charge reflects the maximum sales charge.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15. Returns displayed are based on net total investment expense.

What contributed to or detracted from Fund performance during the fiscal year?

An out-of benchmark allocation to non-agency collateralized mortgage obligations (CMOs) contributed to performance. Issue selection in Fannie Mae (FNMA) and Ginnie Mae (GNMA) securities contributed significantly to performance. An out-of benchmark allocation to asset backed securities (ABS) contributed to performance. Issue selection in Freddie Mac securities was the largest detractor to performance. An out-of benchmark allocation to agency commercial mortgage backed securities detracted from performance. An out-of-benchmark allocation to U.S Treasury securities also hindered performance.

A sales charge may apply as follows: Class A shares: maximum up-front sales charge of 2.25%; Class B shares: contingent deferred sales charge of 5%, which will decline over 5 years (5-5-4-3-2-0%); Class C shares: contingent deferred sales charge of 1% on redemptions made during the first 12 months. Class P shares do not have a sales charge. See the prospectus for details. Performance listed with sales charge reflects the maximum sales charge.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15. Returns displayed are based on net total investment expense.

What contributed to or detracted from Fund performance during the fiscal year?

Underweight to Caesars Entertainment and an overweight to the first lien debt of the corporation contributed the most to performance. Overweight to Jazz Technologies, a semiconductor company, also contributed due to the security price moving higher following a facility joint venture with Panasonic. Exposure to ArcelorMittal, a global steel producer that continues to work on improving its balance sheet, also contributed to performance. The largest detractor was exposure to NII Holdings Inc., a Latin American wireless company which suffered from several operational missteps and is currently in debt restructuring. Midwest Vanadium Pty Ltd, a vanadium mining company currently going through restructuring, also hindered performance. Overweight to the oil field service sector detracted from performance as a result of oil prices trading off fairly rapidly over the last couple of months.

A sales charge may apply as follows: Class A shares: maximum up-front sales charge of 3.75%; Class B shares: contingent deferred sales charge of 5%, which will decline over 5 years (5-5-4-3-2-0%); Class C shares: contingent deferred sales charge of 1% on redemptions made during the first 12 months. Class P shares do not have a sales charge. See the prospectus for details. Performance listed with sales charge reflects the maximum sales charge.

What contributed to or detracted from Fund performance during the fiscal year?

Security selection within the industrials sector, led by selection within the consumer cyclical and technology industries, benefited performance relative to the Barclays U.S. High Yield 2% Issuer Capped Index. Selection within the gaming sub-sector was the most beneficial given exposure to and timely exit from Caesar's Entertainment bonds. Additionally, an overweight position to and selection within First Data Corporation bonds (technology sector) contributed. Issue selection within the communications sector also aided results, led by wireless providers, Deutsche Telekom and SoftBank Corporation, as well as wirelines providers, CenturyLink and Level 3 Communications. Exposure to preferred securities issued by Ally Financial aided results, as did security selection within the independent energy sub-sector. Security selection within the electric utility and metals & mining sub-sectors were a drag on results. Exposure to several coal producers, specifically Arch Coal, Inc. and an overweight to Alpha Natural Resources, Inc. hindered results as these companies were impacted by slowing global demand growth and lower international coal prices. Furthermore, an out-of-index position in Latin American wireless service provider NII Holdings, Inc. hindered results. Additionally, positions in Claire's Inc. and Gymboree (retailers) detracted from performance. Allocation to bank loans negatively impacted results as several issuers underperformed relative to the traditional high yield debt in the index.

A sales charge may apply as follows: Class A shares: maximum up-front sales charge of 3.75%. See the prospectus for details. Performance listed with sales charge reflects the maximum sales charge.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15. Returns displayed are based on net total investment expense.

What contributed to or detracted from Fund performance during the fiscal year?

Overweight to investment grade corporate bonds was the largest contributor to performance as corporate bonds were one of the best performing sectors. Overweight to and issue selection in high yield corporate bonds also contributed to performance. Underweight to U.S. Treasuries aided performance as they were one of the worst performing asset classes in fixed income. Allocation to asset backed securities detracted from performance. Lack of allocation to municipal bonds detracted from performance as this sector outperformed the benchmark. Lack of allocation to sovereign bonds also detracted from performance as this sector outperformed the benchmark.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15. Returns displayed are based on net total investment expense.

What contributed to or detracted from Fund performance during the fiscal year?

U.S. real curve (the real curve reflects real rates: nominal minus inflation equals real) and duration positioning were main contributors, as the portfolio maintained an overweight bias toward longer-dated U.S. Treasury Inflation-Protected Securities (TIPS). In the non-U.S. dollar (USD) space, allocation to Italian inflation-linked bonds and short Euro(EUR)/USD positioning were the primary contributors to active performance. The portfolio's New Zealand (outright) and Australia (vs. U.S.) real rate allocation was also a modest contributor. Short U.S. nominal duration and long U.S. breakeven positioning were the primary detractors. In the non-USD space, the portfolio's German inflation-linked bond position and Japanese positioning were modest detractors. Derivatives are viewed/utilized holistically within our aggregate risk positions. They are used primarily to hedge inflation, interest rate, and currency risk.

A sales charge may apply as follows: Class A shares: maximum up-front sales charge of 3.75%; Class C shares: contingent deferred sales charge of 1% on redemptions made during the first 12 months. See the prospectus for details. Performance listed with sales charge reflects the maximum sales charge.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15. Returns displayed are based on net total investment expense.

What contributed to or detracted from Fund performance during the fiscal year?

Stock selection in Asia was the strongest contributor, led by gains in Malaysia, Taiwan, and India. The traditionally less volatile Malaysian market provided an opportunity to hold overweight positions in Tenaga Nasional and Telekom Malaysia, both of which provided positive relative returns. In Latin America, Brazil contributed as volatility leading up to Dilma Rousseff's re-election and the 2014 World Cup provided an interesting investment landscape. Stock selection in Brazil was a key contributor, as perennial outperformer Kroton Educacional, Brazil's largest education company, doubled. Challenges in China, Thailand, and Indonesia detracted from performance. Timing in Chinese financials proved challenging as positions in Ping An Insurance and Country Garden Holdings were responsible for most of the underperformance in the sector as the property market in China cooled. Europe, the Middle East and Africa (EMEA) detracted. Greek banks such as National Bank of Greece and Piraeus Bank detracted from relative performance as asset quality concerns grew. In addition to the conflict between Russia and Ukraine, Russia detracted due to its largest export, oil, continued price declines amid over supply and the Organization of Petroleum Exporting Countries (OPEC) inconsistencies.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15. Returns displayed are based on net total investment expense.

What contributed to or detracted from Fund performance during the fiscal year?

Selection within the health care sector was a large contributor to relative performance, led by pharmaceuticals and biotechnology stocks. An overweight to and selection within the information technology sector also contributed to relative performance. Selection was positive in Japan and the UK, and an overweight to Western Europe boosted returns. Weak stock selection within industrials detracted from performance. Selection within Eastern Europe and Central Asia detracted from relative performance. Underweight to India was a large detractor, as the country had strong returns. Stock selection within Russia and South Africa detracted from performance.

A sales charge may apply as follows: Class A shares: maximum up-front sales charge of 5.50%. Class P shares do not have a sales charge. See the prospectus for details. Performance listed with sales charge reflects the maximum sales charge.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/16. Returns displayed are based on net total investment expense.

*** Performance shown for the benchmark assumes reinvestment of all dividends and distributions. Indices are unmanaged, and individuals cannot invest directly in an index. The Fund’s primary benchmark changed from the MSCI EAFE NDTR D Index to the MSCI ACWI Ex-U.S. Index because the MSCI ACWI Ex-U.S. Index more closely aligns with the Fund’s investments in developed and emerging markets than the MSCI EAFE NDTR D Index.

What contributed to or detracted from Fund performance during the fiscal year?

Stock selection in the health care sector contributed to performance, led by Gilead, which outperformed based on strong prescription data for newly launched hepatitis-c drug Sovaldi. Allocation to Acatavis also contributed due to acquisition synergies derived from recent purchases of Warner Chilcott and Forest Laboratories. Delta Airlines aided performance as it generated strong profit margins as part of its continued turnaround, and price increases based on industry consolidation and route optimization. Allocation to Pioneer Natural detracted from performance due to weakness from sharply declining energy prices and a temporary pause in production. Allocation to Starbucks also hindered performance based on a temporary slowdown in comparable store sales due largely to adverse weather early in the year. Allocation to the Las Vegas Sands Macau detracted, as a result of anti-corruption policies, a slowing macroeconomic backdrop, lack of compelling new properties, select Visa travel restrictions, and lower spend per visitor.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15. Returns displayed are based on net total investment expense.

Portfolio Managers:

Brown Advisory, LLC
Principal Management Corp.
T. Rowe Price Associates, Inc.

What contributed to or detracted from Fund performance during the fiscal year?

Stock selection in the financial sector contributed to performance, led by an overweight to Charles Schwab. Sector positioning relative to the index also added value, particularly an average 3% overweight to the health care sector. Principal LargeCap Growth Fund I's higher relative strength profile (an overweight to stocks exhibiting upward price movement during the trailing 3-month period) compared to the index, contributed to performance. Stock selection overall detracted from performance, led by selection in the consumer discretionary sector. Selection in the industrials sector detracted from returns due to an overweight to Precision Cast parts Corporation. On average, Principal LargeCap Growth Fund I had a lower dividend yield (a comparison of dividends paid relative to share price, in the absence of capital gains, the dividend yield is the return on investment) than the index which detracted from relative returns.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15; 2/28/16 for Class P. Returns displayed are based on net total investment expense.

What contributed to or detracted from Fund performance during the fiscal year?

Performance was in line with the S&P 500 Index. All ten of the economic sectors posted positive returns with the health care and information technology sectors providing the largest positive returns. Southwest Airlines, Allergan, and Forest Laboratories contributed to portfolio performance. The energy and telecommunication services sectors recorded the worst returns during the period. Avon Products, Whole Foods Market, and Peabody Energy detracted from portfolio performance.

A sales charge may apply as follows: Class A shares: maximum up-front sales charge of 1.50%; Class C shares: contingent deferred sales charge of 1% on redemptions made during the first 12 months. See the prospectus for details. Performance listed with sales charge reflects the maximum sales charge.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15. Returns displayed are based on net total investment expense.

What contributed to or detracted from Fund performance during the fiscal year?

Overweight to Western Digital Corporation contributed as it benefited from stabilization and growth in the PC end market and a deep product portfolio which allows them to leverage the secular growth trends within information storage. Allocation to General Electric contributed to performance due to exceeding third-quarter earnings per share (EPS) estimates driven by taxes and better than expected margins. Overweight position in Apple contributed to performance, driven by strong results as iPhone units exceeded expectations. Overweight to Best Buy detracted due to aggressive promotional activity and declines in store traffic. Overweight position in Baker Hughes detracted from performance as the company missed third-quarter core earnings per share (EPS) estimates due to lower than expected margins in North America. Overweight position in GameStop detracted from performance, as the company reported holiday sales that were in-line with expectations, although software sales were below expectations and guidance for fourth-quarter EPS was lower than expected.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15; 2/28/16 for Class P. Returns displayed are based on net total investment expense.

What contributed to or detracted from Fund performance during the fiscal year?

Allocation to O'Reilly Automotive contributed due to its strength in same store sales growth, as well as integration of the CSK acquisition, and free cash flow allocated to repurchase shares. Williams contributed due to increased appreciation for acquisitions, including the remaining 50% of Access Midstream's general partner and the proposed limited partnership of Access and Williams, potentially creating one of the largest master limited partnership (MLP) companies. Brookfield Asset Management also contributed as it continues to grow its operating platform, global capital raising ability, and asset management franchise. Liberty Media detracted as it was down due to Charter's unsuccessful bid for Time Warner Cable. Discovery Communications detracted due to investor questions regarding European acquisitions and a decline in ratings. Loews detracted due to Boardwalk Pipeline's decision to cut its dividend and focus on capital investment.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15. Returns displayed are based on net total investment expense.

Barrow, Hanley, Mewhinney & Strauss, LLC
Principal Global Investors, LLC
Principal Management Corp.

What contributed to or detracted from Fund performance during the fiscal year?

Positive stock selection within the energy sector contributed to returns. An overweight to the health care sector also aided returns, as this sector outperformed the returns of the overall index. Holding stocks that exhibited a higher relative strength profile (an overweight to stocks exhibiting upward price movement during the trailing 12-month period) than the index contributed. Stock selection was negative overall, which detracted from returns. The worst selection was in the financial sector. Sector positioning relative to the index also hindered returns. Overweight to the industrials sector was the greatest detractor. Principal MidCap Value Fund III held stocks that exhibited more price volatility than the index, detracting from returns.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/16. Returns displayed are based on net total investment expense.

What contributed to or detracted from Fund performance during the fiscal year?

Within the health care sector, an overweight to Allergan, Inc. aided performance as the market responded favorably to its potential takeover. Stock selection within the financial sector also aided results as Charles Schwab benefited from the stock market recovery. Stock selection within the utilities sector aided performance as Sempra Energy outpaced the broader sector. Stock selection within the materials sector detracted from results as FMC Corp underperformed due to weak agriculture prices, which has impacted specialty chemical companies that supply products to agricultural companies. Stock selection within the energy sector hindered performance as several holdings lagged during the period. Within the consumer discretionary sector, Tupperware Brands Corporation detracted as concerns about emerging markets caused the stock to lag.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15. Returns displayed are based on net total investment expense.

What contributed to or detracted from Fund performance during the fiscal year?

Underweight to American Realty Capital Properties contributed to performance as the security consistently underperformed due to questionable growth strategies and poor management. A material underweight to the healthcare sector was another contributor, as the sector trailed the index average. An overweight to Pebblebrook Hotels contributed due to strong demand for the company's assets located in thriving West Coast markets and successful acquisitions. Overweight to and stock selection within the industrials sector was a large detractor, led by a sizeable overweight to ProLogis. Another top detractor was overweight to First Industrial Realty Trust, which was negatively impacted by the prospect of future higher supply growth of industrial assets. Prison owner Correction Corporation of America was a key detractor as the stock underperformed earlier this year after the FBI began a probe into one of the company's prison facilities in Idaho.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15. Returns displayed are based on net total investment expense.

What contributed to or detracted from Fund performance during the fiscal year?

Issue selection in corporate bonds was the largest contributor to performance, led by the electric utilities, communication, banking, and insurance sectors. Lack of allocation to supranational securities also contributed to performance. Allocation to asset backed securities aided performance. Lack of allocation to foreign sovereign securities detracted from performance as they outperformed the benchmark. Allocation to non-agency mortgage backed securities also hindered performance. Allocation to U.S. Treasuries detracted from performance as our holdings lagged the benchmark.

A sales charge may apply as follows: Class A shares: maximum up-front sales charge of 2.25%; Class C shares: contingent deferred sales charge of 1% on redemptions made during the first 12 months. Class P shares do not have a sales charge. See the prospectus for details. Performance listed with sales charge reflects the maximum sales charge.

What contributed to or detracted from Fund performance during the fiscal year?

Eight of ten economic sectors posted positive returns with five of those sectors beating the overall benchmark, led by the health care sector, reflecting the market's enthusiasm for biotechnology companies. The utilities sector also contributed due to the low-interest-rate environment. Stock selection in the information technology, utilities, and consumer discretionary sectors contributed most to performance. RF Micro Devices benefited from strong smartphone demand in China, launch of Apple's iPhone 6, and significant margin improvements. Skechers U.S.A. benefited from stronger-than-expected operating results driven by demand for the company's new athletic footwear. ARRIS Group also contributed. The energy sector detracted the most as crude oil prices deteriorated throughout the year. Stock selection in the industrials, materials, and health care sectors detracted most from performance. Allocation to Conn's detracted as the company experienced continued deterioration in the credit quality of its customer financing. Acxiom detracted amid slower-than-expected initial uptake of its new Audience Operating System. Sanchez Energy, an oil-focused exploration and production company operating in shale regions located in Texas, Louisiana, and Mississippi detracted due to falling oil prices, despite continued strong production results and outlook.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15; 2/28/16 for Class P. Returns displayed are based on net total investment expense.

What contributed to or detracted from Fund performance during the fiscal year?

Stock selection was positive overall, led by selection in the information technology sector. The largest individual contributor within the information technology sector was an out-of-index holding to Skyworks Solutions. Selection in the industrial sector also enhanced returns, led by an overweight to Esterline Technologies Corporation, which was rewarded for a higher relative strength profile (an overweight to stocks exhibiting upward price movement during the trailing 12-month period) than the index. Sector positioning compared to the index hindered returns, led by an overweight to the energy sector, as this was the worst performing sector in the index. Selection within the financial sector further diminished returns. Additionally, the selections had a lower dividend yield (a comparison of dividends paid relative to share price, in the absence of capital gains, the dividend yield is the return on investment) than the index, which hindered performance.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/16. Returns displayed are based on net total investment expense.

What contributed to or detracted from Fund performance during the fiscal year?

Strong book yields (measure that includes the bond's coupon return plus its amortization) in resilient state economies contributed to performance. Rebound in cyclical credits also contributed. Attribution to inverse floaters (debt whose coupon rate has an inverse relationship with the benchmark, adjusting coupon payments as interest rates change) aided performance. Avoidance of the majority of high coupon issuance, due to liquidity flaws, detracted. Holding portfolio duration around the index was another detractor. Low tobacco sector exposure detracted from performance.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses.

Expense limits apply through 2/28/15. Returns displayed are based on net total investment expense.

* Performance assumes reinvestment of all dividends and capital gains. Performance does not reflect the impact of federal, state, or municipal taxes. If it did, performance would be lower.


STATEMENTS OF ASSETS AND LIABILITIES PRINCIPAL FUNDS, INC. October 31, 2014


	Bond & Mortgage				California			Diversified
Amounts in thousands, except per share amounts	Securities Fund				Municipal Fund			International Fund
Investment in securities--at cost	$	4,312,293		$	203,434		$	4,764,539
Foreign currency--at cost	$	2,879		$	–		$	12,871
Assets
Investment in securities--at value	$	4,341,892		$	221,408		$	5,523,554
Foreign currency--at value		2,845			–			12,851
Cash		81,940			16,733			–
Receivables:
Dividends and interest		25,532			2,639			14,150
Expense reimbursement from Manager		9			2			1
Expense reimbursement from Distributor		1			–			1
Foreign currency contracts		301			–			–
Fund shares sold		11,327			5,344			5,675
Investment securities sold		96,413			4,464			48,304
OTC swap agreements--at value (premiums paid $2,537, $0 and $0)		2,201			–			–
Variation margin on financial derivative instruments		193			–			–
Other assets		7			–			5
Prepaid directors' expenses		3			–			–
Total Assets		4,562,664			250,590			5,604,541
Liabilities
Accrued management and investment advisory fees		1,656			85			3,757
Accrued administrative service fees		6			–			8
Accrued distribution fees		76			55			126
Accrued service fees		25			–			39
Accrued transfer agent fees		118			3			247
Accrued directors' expenses		–			–			2
Accrued other expenses		230			31			398
Cash overdraft		–			–			242
Payables:
Deferred foreign tax		–			–			1,195
Dividends payable		9,912			620			–
Foreign currency contracts		41			–			–
Fund shares redeemed		7,799			394			4,508
Interest expense and fees payable		–			14			–
Investment securities purchased		593,018			11,082			79,378
Variation margin on financial derivative instruments		224			–			–
Floating rate notes issued		–			10,739			–
Total Liabilities		613,105			23,023			89,900
Net Assets Applicable to Outstanding Shares	$	3,949,559		$	227,567		$	5,514,641
Net Assets Consist of:
Capital shares and additional paid-in-capital	$	4,046,409		$	253,264		$	5,153,885
Accumulated undistributed (overdistributed) net investment income (loss)		1,288			705			56,939
Accumulated undistributed (overdistributed) net realized gain (loss)		(125,674	)		(44,376	)		(453,771	)
Net unrealized appreciation (depreciation) of investments		27,311			17,974			757,820
Net unrealized appreciation (depreciation) on translation of assets and liabilities in foreign
currency		225			–			(232	)
Total Net Assets	$	3,949,559		$	227,567		$	5,514,641
Capital Stock (par value: $.01 per share):
Shares authorized		1,060,000			400,000			1,525,000
Net Asset Value Per Share:
Class A: Net Assets	$	101,747		$	215,618		$	255,248
Shares Issued and Outstanding		9,279			20,510			21,341
Net Asset Value per share	$	10.97		$	10.51		$	11.96
Maximum Offering Price	$	11.40		$	10.92		$	12.66
Class B: Net Assets	$	1,201		$	386		$	3,778
Shares Issued and Outstanding		109			37			315
Net Asset Value per share	$	10.99	^(a)	$	10.51	^(a)	$	11.99	^(a)
Class C: Net Assets	$	6,654		$	11,563		$	13,125
Shares Issued and Outstanding		607			1,098			1,102
Net Asset Value per share	$	10.97	^(a)	$	10.53	^(a)	$	11.91	^(a)
Class J: Net Assets	$	166,719			N/A		$	200,044
Shares Issued and Outstanding		15,111						16,908
Net Asset Value per share	$	11.03	^(a)				$	11.83	^(a)
Class P: Net Assets		N/A			N/A		$	4,487
Shares Issued and Outstanding								377
Net Asset Value per share							$	11.90
Institutional: Net Assets	$	3,556,478			N/A		$	4,849,850
Shares Issued and Outstanding		324,479						406,241
Net Asset Value per share	$	10.96					$	11.94
R-1: Net Assets	$	4,667			N/A		$	6,020
Shares Issued and Outstanding		426						507
Net Asset Value per share	$	10.96					$	11.87
R-2: Net Assets	$	10,799			N/A		$	9,816
Shares Issued and Outstanding		994						830
Net Asset Value per share	$	10.86					$	11.83
R-3: Net Assets	$	27,332			N/A		$	50,493
Shares Issued and Outstanding		2,507						4,248
Net Asset Value per share	$	10.90					$	11.89
R-4: Net Assets	$	27,091			N/A		$	41,798
Shares Issued and Outstanding		2,441						3,464
Net Asset Value per share	$	11.10					$	12.07
R-5: Net Assets	$	46,871			N/A		$	79,982
Shares Issued and Outstanding		4,296						6,639
Net Asset Value per share	$	10.91					$	12.05


STATEMENTS OF ASSETS AND LIABILITIES PRINCIPAL FUNDS, INC. October 31, 2014


					Global Diversified			Global Real Estate
Amounts in thousands, except per share amounts	Equity Income Fund				Income Fund			Securities Fund
Investment in securities--at cost	$	3,895,078		$	9,542,379		$	2,015,204
Foreign currency--at cost	$	–		$	31,319		$	–
Assets
Investment in securities--at value	$	5,974,846		$	9,916,144		$	2,336,443
Foreign currency--at value		–			31,652			–
Cash		–			35,507			–
Deposits with counterparty		–			435			–
Receivables:
Dividends and interest		8,425			89,534			1,980
Foreign currency contracts		–			8,652			–
Fund shares sold		1,968			69,478			4,665
Investment securities sold		39,175			146,473			33,048
Other assets		2			–			–
Prepaid directors' expenses		–			–			1
Total Assets		6,024,416			10,297,875			2,376,137
Liabilities
Accrued management and investment advisory fees		2,473			5,947			1,615
Accrued administrative service fees		9			–			–
Accrued distribution fees		409			2,825			58
Accrued service fees		64			–			–
Accrued transfer agent fees		262			1,208			85
Accrued directors' expenses		–			2			–
Accrued other expenses		156			701			155
Cash overdraft		3			–			792
Payables:
Dividends payable		–			29,509			–
Foreign currency contracts		–			1,364			–
Fund shares redeemed		5,928			16,777			2,628
Investment securities purchased		31,149			227,520			35,586
Options and swaptions contracts written (premiums received $0, $14,247 and $0)		–			64,767			–
Short sales (proceeds received $0, $19 and $0)		–			20			–
Unrealized loss on unfunded loan commitments		–			1			–
Total Liabilities		40,453			350,641			40,919
Net Assets Applicable to Outstanding Shares	$	5,983,963		$	9,947,234		$	2,335,218
Net Assets Consist of:
Capital shares and additional paid-in-capital	$	4,235,137		$	9,313,905		$	2,010,783
Accumulated undistributed (overdistributed) net investment income (loss)		44,589			84,319			(5,820	)
Accumulated undistributed (overdistributed) net realized gain (loss)		(375,527	)		218,550			9,134
Net unrealized appreciation (depreciation) of investments		2,079,768			323,243			321,239
Net unrealized appreciation (depreciation) on translation of assets and liabilities in foreign
currency		(4	)		7,217			(118	)
Total Net Assets	$	5,983,963		$	9,947,234		$	2,335,218
Capital Stock (par value: $.01 per share):
Shares authorized		1,700,000			1,850,000			700,000
Net Asset Value Per Share:
Class A: Net Assets	$	990,916		$	2,466,867		$	102,093
Shares Issued and Outstanding		37,718			167,133			11,712
Net Asset Value per share	$	26.27		$	14.76		$	8.72
Maximum Offering Price	$	27.80		$	15.34		$	9.23
Class B: Net Assets	$	31,482			N/A			N/A
Shares Issued and Outstanding		1,207
Net Asset Value per share	$	26.09	^(a)
Class C: Net Assets	$	191,198		$	2,766,661		$	47,399
Shares Issued and Outstanding		7,442			188,400			5,579
Net Asset Value per share	$	25.69	^(a)	$	14.69	^(a)	$	8.50	^(a)
Class P: Net Assets	$	130,436		$	3,329,928		$	109,673
Shares Issued and Outstanding		4,963			226,631			11,855
Net Asset Value per share	$	26.28		$	14.69		$	9.25
Institutional: Net Assets	$	4,325,786		$	1,383,778		$	2,076,053
Shares Issued and Outstanding		164,463			94,095			224,158
Net Asset Value per share	$	26.30		$	14.71		$	9.26
R-1: Net Assets	$	3,135			N/A			N/A
Shares Issued and Outstanding		120
Net Asset Value per share	$	26.17
R-2: Net Assets	$	7,068			N/A			N/A
Shares Issued and Outstanding		269
Net Asset Value per share	$	26.26
R-3: Net Assets	$	80,594			N/A			N/A
Shares Issued and Outstanding		3,077
Net Asset Value per share	$	26.19
R-4: Net Assets	$	54,861			N/A			N/A
Shares Issued and Outstanding		2,091
Net Asset Value per share	$	26.24
R-5: Net Assets	$	168,487			N/A			N/A
Shares Issued and Outstanding		6,412
Net Asset Value per share	$	26.28


STATEMENTS OF ASSETS AND LIABILITIES PRINCIPAL FUNDS, INC. October 31, 2014


	Government & High
Amounts in thousands, except per share amounts	Quality Bond Fund				High Yield Fund			High Yield Fund I
Investment in securities--at cost	$	1,657,272		$	3,639,741		$	1,753,561
Foreign currency--at cost	$	–		$	129		$	–
Assets
Investment in securities--at value	$	1,670,396		$	3,658,770		$	1,766,940
Foreign currency--at value		–			127			–
Deposits with counterparty		–			2,222			–
Receivables:
Dividends and interest		7,674			60,257			27,573
Expense reimbursement from Manager		–			–			2
Expense reimbursement from Distributor		28			–			–
Foreign currency contracts		–			1,710			–
Fund shares sold		4,358			53,908			9,888
Investment securities sold		3,780			28,659			11,203
Variation margin on financial derivative instruments		–			196			–
Other assets		19			–			–
Total Assets		1,686,255			3,805,849			1,815,606
Liabilities
Accrued management and investment advisory fees		708			1,565			936
Accrued administrative service fees		3			–			–
Accrued distribution fees		157			700			1
Accrued service fees		11			–			–
Accrued transfer agent fees		122			1,372			19
Accrued other expenses		99			276			68
Cash overdraft		88			8,069			326
Payables:
Dividends payable		3,956			18,644			7,895
Fund shares redeemed		2,209			9,892			2,369
Investment securities purchased		14,220			2,825			11,561
Total Liabilities		21,573			43,343			23,175
Net Assets Applicable to Outstanding Shares	$	1,664,682		$	3,762,506		$	1,792,431
Net Assets Consist of:
Capital shares and additional paid-in-capital	$	1,717,605		$	3,714,825		$	1,765,657
Accumulated undistributed (overdistributed) net investment income (loss)		(4,159	)		(4,790	)		520
Accumulated undistributed (overdistributed) net realized gain (loss)		(61,888	)		31,490			12,875
Net unrealized appreciation (depreciation) of investments		13,124			19,333			13,379
Net unrealized appreciation (depreciation) on translation of assets and liabilities in foreign
currency		–			1,648			–
Total Net Assets	$	1,664,682		$	3,762,506		$	1,792,431
Capital Stock (par value: $.01 per share):
Shares authorized		1,175,000			1,700,000			400,000
Net Asset Value Per Share:
Class A: Net Assets	$	316,531		$	1,192,803		$	2,661
Shares Issued and Outstanding		28,691			154,594			253
Net Asset Value per share	$	11.03		$	7.72		$	10.49
Maximum Offering Price	$	11.28		$	8.02		$	10.90
Class B: Net Assets	$	3,922		$	24,598			N/A
Shares Issued and Outstanding		356			3,169
Net Asset Value per share	$	11.02	^(a)	$	7.76	^(a)
Class C: Net Assets	$	59,847		$	502,489			N/A
Shares Issued and Outstanding		5,431			64,549
Net Asset Value per share	$	11.02	^(a)	$	7.78	^(a)
Class J: Net Assets	$	135,736			N/A			N/A
Shares Issued and Outstanding		12,288
Net Asset Value per share	$	11.05	^(a)
Class P: Net Assets	$	7,390		$	1,049,626			N/A
Shares Issued and Outstanding		669			135,957
Net Asset Value per share	$	11.05		$	7.72
Institutional: Net Assets	$	1,086,207		$	992,990		$	1,789,770
Shares Issued and Outstanding		98,424			129,429			170,552
Net Asset Value per share	$	11.04		$	7.67		$	10.49
R-1: Net Assets	$	2,480			N/A			N/A
Shares Issued and Outstanding		225
Net Asset Value per share	$	11.04
R-2: Net Assets	$	4,914			N/A			N/A
Shares Issued and Outstanding		445
Net Asset Value per share	$	11.04
R-3: Net Assets	$	16,350			N/A			N/A
Shares Issued and Outstanding		1,481
Net Asset Value per share	$	11.04
R-4: Net Assets	$	10,900			N/A			N/A
Shares Issued and Outstanding		987
Net Asset Value per share	$	11.04
R-5: Net Assets	$	20,405			N/A			N/A
Shares Issued and Outstanding		1,847
Net Asset Value per share	$	11.05


STATEMENTS OF ASSETS AND LIABILITIES PRINCIPAL FUNDS, INC. October 31, 2014


										International
							Inflation			Emerging
Amounts in thousands, except per share amounts			Income Fund				Protection Fund			Markets Fund
Investment in securities--at cost		$	2,718,173			$	1,075,505		$	1,945,092
Foreign currency--at cost			$	–		$	56,841		$	13,636
Assets
Investment in securities--at value		$	2,835,595			$	1,064,546		$	2,068,446
Foreign currency--at value				–			56,751			13,448
Cash				5,274			192			–
Deposits with counterparty				–			1,105			–
Receivables:
Dividends and interest				25,293			2,616			1,193
Expense reimbursement from Manager				–			–			1
Expense reimbursement from Distributor				1			–			1
Foreign currency contracts				–			968			–
Fund shares sold				10,994			972			1,576
Investment securities sold				–			4,974			21,593
OTC swap agreements--at value (premiums paid $0, $0 and $0)				–			30			–
Variation margin on financial derivative instruments				–			434			–
Prepaid directors' expenses				1			–			–
Total Assets			2,877,158				1,132,588			2,106,258
Liabilities
Accrued management and investment advisory fees				1,155			352			1,999
Accrued administrative service fees				5			1			3
Accrued distribution fees				148			10			64
Accrued service fees				20			3			14
Accrued transfer agent fees				92			22			153
Accrued directors' expenses				–			1			–
Accrued other expenses				114			66			339
Cash overdraft				–			–			211
Payables:
Deferred foreign tax				–			–			49
Dividends payable				8,354			–			–
Foreign currency contracts				–			108			–
Fund shares redeemed				451			1,133			1,978
Investment securities purchased				22,824			64,610			42,092
Options and swaptions contracts written (premiums received $0, $1,029 and $0)				–			868			–
OTC swap agreements--at value (premiums received $0, $0 and $0)				–			106			–
Variation margin on financial derivative instruments				–			308			–
Total Liabilities				33,163			67,588			46,902
Net Assets Applicable to Outstanding Shares		$	2,843,995			$	1,065,000		$	2,059,356
Net Assets Consist of:
Capital shares and additional paid-in-capital		$	2,780,136			$	1,079,964		$	2,001,028
Accumulated undistributed (overdistributed) net investment income (loss)				(11,031	)		16,186			24,062
Accumulated undistributed (overdistributed) net realized gain (loss)				(42,532	)		(18,703	)		(88,878	)
Net unrealized appreciation (depreciation) of investments			117,422				(13,204	)		123,305
Net unrealized appreciation (depreciation) on translation of assets and liabilities in foreign
currency				–			757			(161	)
Total Net Assets		$	2,843,995			$	1,065,000		$	2,059,356
Capital Stock (par value: $.01 per share):
Shares authorized			1,100,000				900,000			900,000
Net Asset Value Per Share:
Class A: Net Assets	$		272,809			$	15,296		$	93,053
Shares Issued and Outstanding				27,961			1,775			3,721
Net Asset Value per share	$			9.76		$	8.62		$	25.01
Maximum Offering Price	$			9.98		$	8.96		$	26.47
Class B: Net Assets	$			6,203			N/A		$	3,455
Shares Issued and Outstanding				633						147
Net Asset Value per share	$			9.80	^(a)				$	23.48	^(a)
Class C: Net Assets	$			65,027		$	4,222		$	10,906
Shares Issued and Outstanding				6,629			505			455
Net Asset Value per share	$			9.81	^(a)	$	8.36	^(a)	$	23.96	^(a)
Class J: Net Assets	$			93,304		$	8,692		$	129,223
Shares Issued and Outstanding				9,543			1,027			5,353
Net Asset Value per share	$			9.78	^(a)	$	8.46	^(a)	$	24.14	^(a)
Class P: Net Assets	$			25,010			N/A		$	2,023
Shares Issued and Outstanding				2,558						81
Net Asset Value per share	$			9.78					$	24.84
Institutional: Net Assets	$		2,288,675			$	1,023,698		$	1,752,175
Shares Issued and Outstanding			233,964				118,236			70,421
Net Asset Value per share	$			9.78		$	8.66		$	24.88
R-1: Net Assets	$			10,308		$	905		$	3,490
Shares Issued and Outstanding				1,053			108			142
Net Asset Value per share	$			9.79		$	8.35		$	24.66
R-2: Net Assets	$			2,267		$	577		$	5,878
Shares Issued and Outstanding				232			69			240
Net Asset Value per share	$			9.79		$	8.39		$	24.52
R-3: Net Assets	$			24,899		$	5,784		$	14,835
Shares Issued and Outstanding				2,541			684			601
Net Asset Value per share	$			9.80		$	8.46		$	24.68
R-4: Net Assets	$			21,679		$	2,036		$	14,415
Shares Issued and Outstanding				2,214			239			581
Net Asset Value per share	$			9.79		$	8.52		$	24.82
R-5: Net Assets	$			33,814		$	3,790		$	29,903
Shares Issued and Outstanding				3,458			442			1,201
Net Asset Value per share	$			9.78		$	8.57		$	24.89


STATEMENTS OF ASSETS AND LIABILITIES PRINCIPAL FUNDS, INC. October 31, 2014


					LargeCap				LargeCap
Amounts in thousands, except per share amounts	International Fund I				Growth Fund				Growth Fund I
Investment in securities--at cost	$	328,672		$	2,520,163			$	5,695,269
Assets
Investment in securities--at value	$	344,585		$	3,369,825			$	7,773,665
Cash		–			–				1,427
Deposits with counterparty		351			–				8,204
Receivables:
Dividends and interest		2,731			1,176				2,318
Expense reimbursement from Manager		3			–				104
Expense reimbursement from Distributor		–			1				1
Fund shares sold		100			139				631
Investment securities sold		48,298			88,041				27,582
Variation margin on financial derivative instruments		108			–				1,962
Other assets		–			12				–
Total Assets		396,176			3,459,194				7,815,894
Liabilities
Accrued management and investment advisory fees		275			1,701				3,778
Accrued administrative service fees		2			5				20
Accrued distribution fees		4			115				72
Accrued service fees		6			24				125
Accrued transfer agent fees		23			438				284
Accrued other expenses		85			115				93
Cash overdraft		21,689			6				–
Payables:
Fund shares redeemed		1,546			24,676				10,987
Investment securities purchased		–			49,953				41,678
Total Liabilities		23,630			77,033				57,037
Net Assets Applicable to Outstanding Shares	$	372,546		$	3,382,161			$	7,758,857
Net Assets Consist of:
Capital shares and additional paid-in-capital	$	643,722		$	2,174,776			$	4,987,711
Accumulated undistributed (overdistributed) net investment income (loss)		7,271			2,999				8,064
Accumulated undistributed (overdistributed) net realized gain (loss)		(294,382	)		354,724				680,052
Net unrealized appreciation (depreciation) of investments		16,106			849,662				2,083,030
Net unrealized appreciation (depreciation) on translation of assets and liabilities in foreign
currency		(171	)		–				–
Total Net Assets	$	372,546		$	3,382,161			$	7,758,857
Capital Stock (par value: $.01 per share):
Shares authorized		700,000			1,335,000				1,145,000
Net Asset Value Per Share:
Class A: Net Assets	$	771		$	374,202		$		6,464
Shares Issued and Outstanding		57			32,405				480
Net Asset Value per share	$	13.63		$	11.55		$		13.47
Maximum Offering Price	$	14.42		$	12.22		$		14.25
Class B: Net Assets		N/A		$	5,696				N/A
Shares Issued and Outstanding					545
Net Asset Value per share				$	10.45	^(a)
Class C: Net Assets		N/A		$	16,043				N/A
Shares Issued and Outstanding					1,487
Net Asset Value per share				$	10.79	^(a)
Class J: Net Assets		N/A		$	64,841		$		106,144
Shares Issued and Outstanding					5,895				8,868
Net Asset Value per share				$	11.00	^(a)	$		11.97	^(a)
Class P: Net Assets	$	10		$	11,169		$		18
Shares Issued and Outstanding		1			942				1
Net Asset Value per share	$	13.65		$	11.86		$		13.58
Institutional: Net Assets	$	344,528		$	2,791,488		$		7,031,086
Shares Issued and Outstanding		25,237			234,054				517,280
Net Asset Value per share	$	13.65		$	11.93		$		13.59
R-1: Net Assets	$	4,271		$	6,258		$		8,406
Shares Issued and Outstanding		316			559				672
Net Asset Value per share	$	13.54		$	11.19		$		12.51
R-2: Net Assets	$	3,069		$	5,846		$		21,048
Shares Issued and Outstanding		226			516				1,717
Net Asset Value per share	$	13.57		$	11.34		$		12.26
R-3: Net Assets	$	5,340		$	20,863		$		165,698
Shares Issued and Outstanding		393			1,712				12,861
Net Asset Value per share	$	13.57		$	12.19		$		12.88
R-4: Net Assets	$	5,718		$	13,833		$		90,002
Shares Issued and Outstanding		420			1,141				6,937
Net Asset Value per share	$	13.60		$	12.12		$		12.97
R-5: Net Assets	$	8,839		$	71,922		$		329,991
Shares Issued and Outstanding		649			5,992				24,859
Net Asset Value per share	$	13.61		$	12.00		$		13.27


STATEMENTS OF ASSETS AND LIABILITIES PRINCIPAL FUNDS, INC. October 31, 2014


	LargeCap S&P 500				LargeCap
Amounts in thousands, except per share amounts		Index Fund			Value Fund				MidCap Fund
Investment in securities--at cost	$	2,589,836		$	3,331,531			$	6,497,391
Assets
Investment in securities--at value	$	4,249,363		$	3,751,125			$	8,875,587
Cash		–			–				173
Receivables:
Dividends and interest		4,094			2,499				4,106
Expense reimbursement from Manager		2			4				–
Expense reimbursement from Distributor		4			1				2
Fund shares sold		3,054			352				14,986
Investment securities sold		–			43,094				513
Variation margin on financial derivative instruments		1,212			423				–
Other assets		3			28				6
Total Assets		4,257,732			3,797,526				8,895,373
Liabilities
Accrued management and investment advisory fees		518			1,239				4,316
Accrued administrative service fees		33			1				29
Accrued distribution fees		236			69				799
Accrued service fees		191			5				135
Accrued transfer agent fees		215			148				1,059
Accrued directors' expenses		–			2				6
Accrued other expenses		133			99				627
Payables:
Fund shares redeemed		7,382			2,114				10,956
Investment securities purchased		–			44,484				12,220
Total Liabilities		8,708			48,161				30,147
Net Assets Applicable to Outstanding Shares	$	4,249,024		$	3,749,365			$	8,865,226
Net Assets Consist of:
Capital shares and additional paid-in-capital	$	2,636,863		$	2,942,826			$	6,020,450
Accumulated undistributed (overdistributed) net investment income (loss)		52,094			43,254				21,684
Accumulated undistributed (overdistributed) net realized gain (loss)		(101,983	)		343,239				444,896
Net unrealized appreciation (depreciation) of investments		1,662,050			420,046				2,378,196
Total Net Assets	$	4,249,024		$	3,749,365			$	8,865,226
Capital Stock (par value: $.01 per share):
Shares authorized		950,000			1,000,000				1,675,000
Net Asset Value Per Share:
Class A: Net Assets	$	245,546		$	211,555		$		1,863,094
Shares Issued and Outstanding		17,115			15,218				84,719
Net Asset Value per share	$	14.35		$	13.90		$		21.99
Maximum Offering Price	$	14.57		$	14.71		$		23.27
Class B: Net Assets		N/A		$	1,460		$		13,320
Shares Issued and Outstanding					106				637
Net Asset Value per share				$	13.77	^(a)	$		20.92	^(a)
Class C: Net Assets	$	25,433		$	8,023		$		353,109
Shares Issued and Outstanding		1,806			591				17,024
Net Asset Value per share	$	14.08	^(a)	$	13.58	^(a)	$		20.74	^(a)
Class J: Net Assets	$	508,718		$	75,289		$		290,503
Shares Issued and Outstanding		35,794			5,500				13,661
Net Asset Value per share	$	14.21	^(a)	$	13.69	^(a)	$		21.27	^(a)
Class P: Net Assets		N/A		$	205		$		1,841,917
Shares Issued and Outstanding					15				82,679
Net Asset Value per share				$	13.89		$		22.28
Institutional: Net Assets	$	2,530,539		$	3,432,095		$		3,836,296
Shares Issued and Outstanding		176,294			246,842				171,764
Net Asset Value per share	$	14.35		$	13.90		$		22.33
R-1: Net Assets	$	18,889		$	1,415		$		32,574
Shares Issued and Outstanding		1,325			103				1,550
Net Asset Value per share	$	14.26		$	13.76		$		21.02
R-2: Net Assets	$	37,848		$	4,144		$		40,695
Shares Issued and Outstanding		2,638			300				1,920
Net Asset Value per share	$	14.35		$	13.81		$		21.20
R-3: Net Assets	$	248,852		$	4,508		$		158,675
Shares Issued and Outstanding		17,369			327				7,311
Net Asset Value per share	$	14.33		$	13.80		$		21.70
R-4: Net Assets	$	214,570		$	2,579		$		168,845
Shares Issued and Outstanding		14,916			187				7,576
Net Asset Value per share	$	14.39		$	13.78		$		22.29
R-5: Net Assets	$	418,629		$	8,092		$		266,198
Shares Issued and Outstanding		28,869			582				12,031
Net Asset Value per share	$	14.50		$	13.90		$		22.13


STATEMENTS OF ASSETS AND LIABILITIES PRINCIPAL FUNDS, INC. October 31, 2014


		MidCap				Money			Principal Capital
Amounts in thousands, except per share amounts		Value Fund III				Market Fund			Appreciation Fund
Investment in securities--at cost		$	845,706		$	1,083,038		$	1,334,530
Assets
Investment in securities--at value		$	977,480		$	1,083,038		$	2,494,699
Cash			170			12			–
Deposits with counterparty			1,900			–			–
Receivables:
Dividends and interest			459			47			1,848
Expense reimbursement from Manager			14			356			–
Expense reimbursement from Distributor			1			18			–
Fund shares sold			312			2,901			892
Investment securities sold			2,609			–			3,680
Variation margin on financial derivative instruments			419			–			–
Other assets			–			26			5
Total Assets			983,364			1,086,398			2,501,124
Liabilities
Accrued management and investment advisory fees			509			364			922
Accrued administrative service fees			1			–			3
Accrued distribution fees			27			71			224
Accrued service fees			9			–			16
Accrued transfer agent fees			32			229			142
Accrued directors' expenses			–			–			1
Accrued other expenses			56			122			96
Cash overdraft			–			–			97
Payables:
Fund shares redeemed			1,889			5,889			1,621
Investment securities purchased			547			–			5,777
Total Liabilities			3,070			6,675			8,899
Net Assets Applicable to Outstanding Shares		$	980,294		$	1,079,723		$	2,492,225
Net Assets Consist of:
Capital shares and additional paid-in-capital		$	772,414		$	1,120,963		$	1,245,284
Accumulated undistributed (overdistributed) net investment income (loss)			8,138			–			21,687
Accumulated undistributed (overdistributed) net realized gain (loss)			67,252			(41,240	)		65,085
Net unrealized appreciation (depreciation) of investments			132,490			–			1,160,169
Total Net Assets		$	980,294		$	1,079,723		$	2,492,225
Capital Stock (par value: $.01 per share):
Shares authorized			525,000			8,400,000			1,000,000
Net Asset Value Per Share:
Class A: Net Assets	$		1,997		$	471,109		$	810,788
Shares Issued and Outstanding			97			471,013			13,789
Net Asset Value per share	$		20.54		$	1.00		$	58.80
Maximum Offering Price	$		21.74		$	1.00		$	62.22
Class B: Net Assets			N/A		$	3,342		$	20,406
Shares Issued and Outstanding						3,341			416
Net Asset Value per share					$	1.00	^(a)	$	49.04	^(a)
Class C: Net Assets			N/A		$	17,977		$	42,658
Shares Issued and Outstanding						17,973			873
Net Asset Value per share					$	1.00	^(a)	$	48.88	^(a)
Class J: Net Assets	$		112,480		$	249,914			N/A
Shares Issued and Outstanding			5,761			249,864
Net Asset Value per share	$		19.52	^(a)	$	1.00	^(a)
Class P: Net Assets	$		41			N/A		$	31,028
Shares Issued and Outstanding			2						522
Net Asset Value per share	$		20.58					$	59.49
Institutional: Net Assets	$		822,011		$	337,381		$	1,507,343
Shares Issued and Outstanding			39,900			337,313			25,260
Net Asset Value per share	$		20.60		$	1.00		$	59.67
R-1: Net Assets	$		1,046			N/A		$	1,635
Shares Issued and Outstanding			53						28
Net Asset Value per share	$		19.65					$	58.68
R-2: Net Assets	$		1,663			N/A		$	2,155
Shares Issued and Outstanding			84						36
Net Asset Value per share	$		19.76					$	58.79
R-3: Net Assets	$		9,010			N/A		$	24,394
Shares Issued and Outstanding			459						415
Net Asset Value per share	$		19.64					$	58.78
R-4: Net Assets	$		14,160			N/A		$	15,267
Shares Issued and Outstanding			727						258
Net Asset Value per share	$		19.48					$	59.17
R-5: Net Assets	$		17,886			N/A		$	36,551
Shares Issued and Outstanding			910						616
Net Asset Value per share	$		19.65					$	59.34


STATEMENTS OF ASSETS AND LIABILITIES PRINCIPAL FUNDS, INC. October 31, 2014


			Real Estate				Short-Term			SmallCap
Amounts in thousands, except per share amounts			Securities Fund				Income Fund			Blend Fund
Investment in securities--at cost		$	1,413,673			$	2,516,844		$	412,834
Assets
Investment in securities--at value		$	2,043,994			$	2,527,718		$	506,886
Cash			–				–			5
Deposits with counterparty			–				–			280
Receivables:
Dividends and interest			384				15,523			207
Expense reimbursement from Manager			–				–			1
Expense reimbursement from Distributor			2				1			2
Fund shares sold			4,319				5,706			364
Investment securities sold			–				1			6,759
Variation margin on financial derivative instruments			–				–			95
Other assets			–				–			1
	Total Assets		2,048,699				2,548,949			514,600
Liabilities
Accrued management and investment advisory fees			1,326				893			305
Accrued administrative service fees			10				2			2
Accrued distribution fees			130				143			96
Accrued service fees			63				9			6
Accrued transfer agent fees			218				127			149
Accrued directors' expenses			–				1			–
Accrued other expenses			144				170			90
Cash overdraft			–				86			–
Payables:
Dividends payable			–				3,175			–
Fund shares redeemed			2,769				2,111			292
Investment securities purchased			9,326				4,056			4,578
	Total Liabilities		13,986				10,773			5,518
Net Assets Applicable to Outstanding Shares		$	2,034,713			$	2,538,176		$	509,082
Net Assets Consist of:
Capital shares and additional paid-in-capital		$	1,401,816			$	2,544,268		$	369,148
Accumulated undistributed (overdistributed) net investment income (loss)			4,917				3,154			9
Accumulated undistributed (overdistributed) net realized gain (loss)			(2,341	)			(20,120	)		45,620
Net unrealized appreciation (depreciation) of investments			630,321				10,874			94,305
	Total Net Assets	$	2,034,713			$	2,538,176		$	509,082
Capital Stock (par value: $.01 per share):
Shares authorized			950,000				820,000			725,000
Net Asset Value Per Share:
Class A: Net Assets	$		208,670		$		277,110		$	189,911
Shares Issued and Outstanding			9,377				22,655			8,734
Net Asset Value per share	$		22.25		$		12.23		$	21.74
Maximum Offering Price	$		23.54		$		12.51		$	23.01
Class B: Net Assets	$		3,588				N/A		$	2,705
Shares Issued and Outstanding			163							137
Net Asset Value per share	$		21.98	^(a)					$	19.74	^(a)
Class C: Net Assets	$		33,740		$		90,275		$	15,737
Shares Issued and Outstanding			1,537				7,376			766
Net Asset Value per share	$		21.95	^(a)	$		12.24	^(a)	$	20.53	^(a)
Class J: Net Assets	$		182,382		$		120,296		$	200,333
Shares Issued and Outstanding			8,405				9,839			9,550
Net Asset Value per share	$		21.70	^(a)	$		12.23	^(a)	$	20.98	^(a)
Class P: Net Assets	$		43,891		$		72,897		$	78
Shares Issued and Outstanding			1,973				5,961			3
Net Asset Value per share	$		22.24		$		12.23		$	22.76
Institutional: Net Assets	$		1,247,104		$		1,936,142		$	72,583
Shares Issued and Outstanding			56,021				158,370			3,188
Net Asset Value per share	$		22.26		$		12.23		$	22.77
R-1: Net Assets	$		7,138		$		1,468		$	2,079
Shares Issued and Outstanding			324				120			99
Net Asset Value per share	$		22.01		$		12.23		$	21.13
R-2: Net Assets	$		17,507		$		1,957		$	2,956
Shares Issued and Outstanding			821				160			139
Net Asset Value per share	$		21.34		$		12.23		$	21.27
R-3: Net Assets	$		56,032		$		14,472		$	6,628
Shares Issued and Outstanding			2,572				1,183			305
Net Asset Value per share	$		21.79		$		12.23		$	21.77
R-4: Net Assets	$		67,466		$		14,272		$	4,052
Shares Issued and Outstanding			3,126				1,167			181
Net Asset Value per share	$		21.58		$		12.23		$	22.34
R-5: Net Assets	$		167,195		$		9,287		$	12,020
Shares Issued and Outstanding			7,733				759			530
Net Asset Value per share	$		21.62		$		12.24		$	22.66


STATEMENTS OF ASSETS AND LIABILITIES PRINCIPAL FUNDS, INC. October 31, 2014


			SmallCap			Tax-Exempt
Amounts in thousands, except per share amounts			Value Fund II			Bond Fund
Investment in securities--at cost		$	1,272,962		$	199,631
Assets
Investment in securities--at value		$	1,565,295		$	220,658
Cash			682			1,986
Deposits with counterparty			3,000			–
Receivables:
Dividends and interest			370			3,326
Expense reimbursement from Manager			33			5
Fund shares sold			100			820
Investment securities sold			3,574			–
Variation margin on financial derivative instruments			982			–
Other assets			–			9
	Total Assets		1,574,036			226,804
Liabilities
Accrued management and investment advisory fees			1,228			83
Accrued administrative service fees			2			–
Accrued distribution fees			9			53
Accrued service fees			11			–
Accrued transfer agent fees			11			16
Accrued other expenses			38			36
Payables:
Dividends payable			–			865
Fund shares redeemed			3,167			271
Interest expense and fees payable			–			16
Investment securities purchased			6,774			–
Floating rate notes issued			–			7,621
	Total Liabilities		11,240			8,961
Net Assets Applicable to Outstanding Shares		$	1,562,796		$	217,843
Net Assets Consist of:
Capital shares and additional paid-in-capital		$	1,141,338		$	217,897
Accumulated undistributed (overdistributed) net investment income (loss)			1,046			1,030
Accumulated undistributed (overdistributed) net realized gain (loss)			124,923			(22,111	)
Net unrealized appreciation (depreciation) of investments			295,489			21,027
	Total Net Assets	$	1,562,796		$	217,843
Capital Stock (par value: $.01 per share):
Shares authorized			725,000			400,000
Net Asset Value Per Share:
Class A: Net Assets	$		223		$	207,234
Shares Issued and Outstanding			16			27,912
Net Asset Value per share	$		14.08		$	7.42
Maximum Offering Price	$		14.90		$	7.71
Class B: Net Assets			N/A		$	708
Shares Issued and Outstanding						95
Net Asset Value per share					$	7.42	^(a)
Class C: Net Assets			N/A		$	9,901
Shares Issued and Outstanding						1,330
Net Asset Value per share					$	7.44	^(a)
Class J: Net Assets	$		19,885			N/A
Shares Issued and Outstanding			1,436
Net Asset Value per share	$		13.85	^(a)
Class P: Net Assets	$		15			N/A
Shares Issued and Outstanding			1
Net Asset Value per share	$		14.09
Institutional: Net Assets	$		1,489,023			N/A
Shares Issued and Outstanding			105,572
Net Asset Value per share	$		14.10
R-1: Net Assets	$		1,870			N/A
Shares Issued and Outstanding			141
Net Asset Value per share	$		13.30
R-2: Net Assets	$		4,588			N/A
Shares Issued and Outstanding			342
Net Asset Value per share	$		13.40
R-3: Net Assets	$		11,532			N/A
Shares Issued and Outstanding			840
Net Asset Value per share	$		13.72
R-4: Net Assets	$		13,254			N/A
Shares Issued and Outstanding			959
Net Asset Value per share	$		13.83
R-5: Net Assets	$		22,406			N/A
Shares Issued and Outstanding			1,608
Net Asset Value per share	$		13.93


STATEMENTS OF OPERATIONS
PRINCIPAL FUNDS, INC.
Year Ended October 31, 2014

	Bond & Mortgage				California			Diversified
Amounts in thousands	Securities Fund				Municipal Fund			International Fund
Net Investment Income (Loss)
Income:
Dividends	$	720			$ –		$	145,457
Withholding tax		–			–			(16,679	)
Interest		81,384			9,691			24
Total Income		82,104			9,691			128,802
Expenses:
Management and investment advisory fees		13,883			862			44,146
Distribution fees - Class A		260			453			660
Distribution fees - Class B		13			6			44
Distribution fees - Class C		66			97			133
Distribution fees - Class J		477			N/A			581
Distribution fees - R-1		19			N/A			24
Distribution fees - R-2		39			N/A			32
Distribution fees - R-3		76			N/A			137
Distribution fees - R-4		28			N/A			46
Administrative service fees - R-1		15			N/A			19
Administrative service fees - R-2		26			N/A			21
Administrative service fees - R-3		21			N/A			38
Administrative service fees - R-4		9			N/A			14
Administrative service fees - R-5		5			N/A			9
Registration fees - Class A		19			20			20
Registration fees - Class B		17			16			17
Registration fees - Class C		15			16			16
Registration fees - Class J		15			N/A			18
Registration fees - Class P		N/A			N/A			15
Registration fees - Institutional		159			N/A			47
Service fees - R-1		14			N/A			17
Service fees - R-2		33			N/A			26
Service fees - R-3		76			N/A			137
Service fees - R-4		70			N/A			115
Service fees - R-5		114			N/A			213
Shareholder reports - Class A		32			9			69
Shareholder reports - Class B		1			–			4
Shareholder reports - Class C		2			1			3
Shareholder reports - Class J		67			N/A			68
Shareholder reports - Institutional		1			N/A			20
Transfer agent fees - Class A		203			58			522
Transfer agent fees - Class B		11			6			21
Transfer agent fees - Class C		18			10			30
Transfer agent fees - Class J		198			N/A			272
Transfer agent fees - Class P		N/A			N/A			4
Transfer agent fees - Institutional		2			N/A			119
Custodian fees		29			2			680
Directors' expenses		38			5			81
Interest expense and fees		–			79			–
Professional fees		34			28			71
Other expenses		15			2			32
Total Gross Expenses		16,120			1,670			48,541
Less: Reimbursement from Manager - Class A		134			–			–
Less: Reimbursement from Manager - Class B		28			20			15
Less: Reimbursement from Manager - Class C		20			–			19
Less: Reimbursement from Manager - Class P		N/A			N/A			15
Less: Reimbursement from Manager - Institutional		10			N/A			–
Less: Reimbursement from Distributor - Class J		70			N/A			83
Total Net Expenses		15,858			1,650			48,409
Net Investment Income (Loss)		66,246			8,041			80,393

Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements
Net realized gain (loss) from:
Investment transactions		31,510			(1,654	)		227,941
Foreign currency transactions		129			–			(2,679	)
Futures contracts		(707	)		–			–
Swap agreements		(2,395	)		–			–
Change in unrealized appreciation/depreciation of:
Investments (net of deferred foreign tax payable of $0, $0 and $884, respectively) .		16,961			15,116			(140,523	)
Futures contracts		(522	)		–			–
Swap agreements		(545	)		–			–
Translation of assets and liabilities in foreign currencies		288			–			(347	)
Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements		44,719			13,462			84,392
Net Increase (Decrease) in Net Assets Resulting from Operations	$	110,965		$	21,503		$	164,785


STATEMENTS OF OPERATIONS
PRINCIPAL FUNDS, INC.
Year Ended October 31, 2014

					Global Diversified			Global Real Estate
Amounts in thousands	Equity Income Fund				Income Fund			Securities Fund
Net Investment Income (Loss)
Income:
Dividends	$	182,863		$	129,327		$	49,339
Withholding tax		(4,553	)		(5,001	)		(2,460	)
Interest		46			359,998			7
Total Income		178,356			484,324			46,886
Expenses:
Management and investment advisory fees		28,707			63,649			16,566
Distribution fees - Class A		2,424			6,543			222
Distribution fees - Class B		420			N/A			N/A
Distribution fees - Class C		1,780			25,327			372
Distribution fees - R-1		12			N/A			N/A
Distribution fees - R-2		26			N/A			N/A
Distribution fees - R-3		196			N/A			N/A
Distribution fees - R-4		56			N/A			N/A
Administrative service fees - R-1		9			N/A			N/A
Administrative service fees - R-2		17			N/A			N/A
Administrative service fees - R-3		55			N/A			N/A
Administrative service fees - R-4		17			N/A			N/A
Administrative service fees - R-5		16			N/A			N/A
Registration fees - Class A		33			57			25
Registration fees - Class B		17			N/A			N/A
Registration fees - Class C		19			68			27
Registration fees - Class P		27			181			36
Registration fees - Institutional		20			91			86
Service fees - R-1		9			N/A			N/A
Service fees - R-2		22			N/A			N/A
Service fees - R-3		196			N/A			N/A
Service fees - R-4		139			N/A			N/A
Service fees - R-5		391			N/A			N/A
Shareholder reports - Class A		115			416			12
Shareholder reports - Class B		12			N/A			N/A
Shareholder reports - Class C		17			380			6
Shareholder reports - Class P		7			332			9
Shareholder reports - Institutional		7			77			28
Transfer agent fees - Class A		1,153			2,167			131
Transfer agent fees - Class B		47			N/A			N/A
Transfer agent fees - Class C		184			2,287			63
Transfer agent fees - Class P		76			1,917			91
Transfer agent fees - Institutional		211			370			179
Custodian fees		92			319			105
Directors' expenses		83			127			30
Dividends and interest on securities sold short		–			7,887			–
Professional fees		34			57			31
Other expenses		42			101			9
Total Expenses		36,688			112,353			18,028
Net Investment Income (Loss)		141,668			371,971			28,858

Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements
Net realized gain (loss) from:
Investment transactions		145,109			246,968			35,081
Foreign currency transactions		(24	)		10,636			(50	)
Options and swaptions		–			(2,407	)		–
Change in unrealized appreciation/depreciation of:
Investments		545,848			61,023			156,289
Options and swaptions		–			(46,669	)		–
Short sales		–			(1	)		–
Translation of assets and liabilities in foreign currencies		(5	)		7,726			(119	)
Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements		690,928			277,276			191,201
Net Increase (Decrease) in Net Assets Resulting from Operations	$	832,596		$	649,247		$	220,059


STATEMENTS OF OPERATIONS
PRINCIPAL FUNDS, INC.
Year Ended October 31, 2014

	Government & High
Amounts in thousands	Quality Bond Fund			High Yield Fund			High Yield Fund I
Net Investment Income (Loss)
Income:
Dividends	$	–	$	2,414		$	1,224
Interest		51,537		258,779			101,157
Total Income		51,537		261,193			102,381
Expenses:
Management and investment advisory fees		8,562		20,618			10,548
Distribution fees - Class A		849		4,284			66
Distribution fees - Class B		47		293			N/A
Distribution fees - Class C		668		5,358			N/A
Distribution fees - Class J		386		N/A			N/A
Distribution fees - R-1		9		N/A			N/A
Distribution fees - R-2		15		N/A			N/A
Distribution fees - R-3		42		N/A			N/A
Distribution fees - R-4		11		N/A			N/A
Administrative service fees - R-1		7		N/A			N/A
Administrative service fees - R-2		10		N/A			N/A
Administrative service fees - R-3		12		N/A			N/A
Administrative service fees - R-4		3		N/A			N/A
Administrative service fees - R-5		2		N/A			N/A
Registration fees - Class A		31		78			32
Registration fees - Class B		15		18			N/A
Registration fees - Class C		18		28			N/A
Registration fees - Class J		19		N/A			N/A
Registration fees - Class P		15		107			N/A
Registration fees - Institutional		25		67			42
Service fees - R-1		7		N/A			N/A
Service fees - R-2		12		N/A			N/A
Service fees - R-3		42		N/A			N/A
Service fees - R-4		27		N/A			N/A
Service fees - R-5		46		N/A			N/A
Shareholder reports - Class A		52		272			8
Shareholder reports - Class B		2		6			N/A
Shareholder reports - Class C		8		59			N/A
Shareholder reports - Class J		39		N/A			N/A
Shareholder reports - Class P		1		67			N/A
Shareholder reports - Institutional		1		74			7
Transfer agent fees - Class A		379		2,542			72
Transfer agent fees - Class B		16		36			N/A
Transfer agent fees - Class C		69		466			N/A
Transfer agent fees - Class J		142		N/A			N/A
Transfer agent fees - Class P		4		940			N/A
Transfer agent fees - Institutional		19		615			67
Custodian fees		8		16			30
Directors' expenses		27		63			26
Professional fees		33		38			32
Other expenses		12		46			14
Total Gross Expenses		11,692		36,091			10,944
Less: Reimbursement from Manager - Class A		–		–			68
Less: Reimbursement from Manager - Class B		27		–			N/A
Less: Reimbursement from Manager - Class C		11		–			N/A
Less: Reimbursement from Manager - Class P		4		–			N/A
Less: Reimbursement from Manager - R-1		3		N/A			N/A
Less: Reimbursement from Manager - R-2		5		N/A			N/A
Less: Reimbursement from Manager - R-3		16		N/A			N/A
Less: Reimbursement from Manager - R-4		10		N/A			N/A
Less: Reimbursement from Manager - R-5		18		N/A			N/A
Less: Reimbursement from Distributor - Class A		340		–			–
Less: Reimbursement from Distributor - Class J		57		N/A			N/A
Total Net Expenses		11,201		36,091			10,876
Net Investment Income (Loss)		40,336		225,102			91,505

Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements
Net realized gain (loss) from:
Investment transactions		8,269		43,470			16,019
Foreign currency transactions		–		4,983			(14	)
Swap agreements		–		45			–
Change in unrealized appreciation/depreciation of:
Investments		10,453		(64,060	)		(27,127	)
Swap agreements		–		304			–
Translation of assets and liabilities in foreign currencies		–		1,176			(2	)
Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements		18,722		(14,082	)		(11,124	)
Net Increase (Decrease) in Net Assets Resulting from Operations	$	59,058	$	211,020		$	80,381


STATEMENTS OF OPERATIONS
PRINCIPAL FUNDS, INC.
Year Ended October 31, 2014

							International
				Inflation			Emerging
Amounts in thousands		Income Fund		Protection Fund			Markets Fund
Net Investment Income (Loss)
Income:
Dividends	$	–	$	24		$	56,396
Withholding tax		–		–			(7,248	)
Interest		107,064		15,912			9
Total Income		107,064		15,936			49,157
Expenses:
Management and investment advisory fees		12,669		3,690			22,870
Distribution fees - Class A		689		39			237
Distribution fees - Class B		74		N/A			39
Distribution fees - Class C		667		45			109
Distribution fees - Class J		247		25			382
Distribution fees - R-1		27		3			14
Distribution fees - R-2		5		2			18
Distribution fees - R-3		56		14			42
Distribution fees - R-4		19		2			17
Administrative service fees - R-1		22		2			11
Administrative service fees - R-2		3		1			12
Administrative service fees - R-3		15		4			12
Administrative service fees - R-4		6		1			5
Administrative service fees - R-5		3		1			3
Registration fees - Class A		27		18			18
Registration fees - Class B		16		N/A			17
Registration fees - Class C		18		15			16
Registration fees - Class J		21		20			17
Registration fees - Class P		17		N/A			15
Registration fees - Institutional		49		39			34
Service fees - R-1		19		2			10
Service fees - R-2		4		2			15
Service fees - R-3		56		14			42
Service fees - R-4		47		5			43
Service fees - R-5		80		19			78
Shareholder reports - Class A		34		6			32
Shareholder reports - Class B		2		N/A			3
Shareholder reports - Class C		10		2			4
Shareholder reports - Class J		16		4			48
Shareholder reports - Class P		1		N/A			–
Shareholder reports - Institutional		19		1			22
Transfer agent fees - Class A		275		25			232
Transfer agent fees - Class B		13		N/A			18
Transfer agent fees - Class C		91		12			34
Transfer agent fees - Class J		97		18			186
Transfer agent fees - Class P		9		N/A			4
Transfer agent fees - Institutional		112		1			117
Custodian fees		6		12			725
Directors' expenses		39		16			31
Professional fees		34		30			81
Other expenses		14		6			14
Total Gross Expenses		15,628		4,096			25,627
Less: Reimbursement from Manager - Class A		–		9			–
Less: Reimbursement from Manager - Class B		–		N/A			15
Less: Reimbursement from Manager - Class C		–		18			–
Less: Reimbursement from Manager - Class P		–		N/A			16
Less: Reimbursement from Distributor - Class J		35		4			57
Total Net Expenses		15,593		4,065			25,539
Net Investment Income (Loss)		91,471		11,871			23,618

Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements
Net realized gain (loss) from:
Investment transactions		6,938		(2,958	)		16,502
Foreign currency transactions		–		6,299			(1,904	)
Futures contracts		–		(6,354	)		–
Options and swaptions		–		38			–
Swap agreements		–		(1,389	)		–
Change in unrealized appreciation/depreciation of:
Investments		27,302		9,505			(28,853	)
Futures contracts		–		(1,719	)		–
Options and swaptions		–		57			–
Swap agreements		–		3			–
Translation of assets and liabilities in foreign currencies		–		364			(85	)
Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements		34,240		3,846			(14,340	)
Net Increase (Decrease) in Net Assets Resulting from Operations	$	125,711	$	15,717		$	9,278


STATEMENTS OF OPERATIONS
PRINCIPAL FUNDS, INC.
Year Ended October 31, 2014

		International			LargeCap			LargeCap
Amounts in thousands		Fund I ^(a)			Growth Fund			Growth Fund I ^(b)
Net Investment Income (Loss)
Income:
Dividends	$	14,295		$	28,793		$	59,401
Withholding tax		(1,538	)		(72	)		(213	)
Interest		4			13			65
Total Income		12,761			28,734			59,253
Expenses:
Management and investment advisory fees		4,328			19,921			44,159
Distribution fees - Class A		–			905			12
Distribution fees - Class B		N/A			62			N/A
Distribution fees - Class C		N/A			153			N/A
Distribution fees - Class J		N/A			170			288
Distribution fees - R-1		16			24			29
Distribution fees - R-2		11			21			64
Distribution fees - R-3		15			53			407
Distribution fees - R-4		7			16			98
Administrative service fees - R-1		13			19			23
Administrative service fees - R-2		7			14			43
Administrative service fees - R-3		4			15			114
Administrative service fees - R-4		2			5			29
Administrative service fees - R-5		1			7			29
Registration fees - Class A		17			21			17
Registration fees - Class B		N/A			16			N/A
Registration fees - Class C		N/A			16			N/A
Registration fees - Class J		N/A			17			20
Registration fees - Class P		16			15			16
Registration fees - Institutional		29			34			46
Service fees - R-1		11			17			21
Service fees - R-2		9			17			53
Service fees - R-3		16			53			407
Service fees - R-4		17			40			244
Service fees - R-5		21			178			733
Shareholder reports - Class A		1			94			1
Shareholder reports - Class B		N/A			3			N/A
Shareholder reports - Class C		N/A			3			N/A
Shareholder reports - Class J		N/A			15			20
Shareholder reports - Class P		1			1			1
Shareholder reports - Institutional		35			(7	)		34
Transfer agent fees - Class A		3			594			15
Transfer agent fees - Class B		N/A			21			N/A
Transfer agent fees - Class C		N/A			26			N/A
Transfer agent fees - Class J		N/A			79			128
Transfer agent fees - Class P		–			8			–
Transfer agent fees - Institutional		118			710			1,075
Custodian fees		173			3			26
Directors' expenses		10			51			107
Professional fees		52			29			39
Other expenses		7			19			54
Total Gross Expenses		4,940			23,458			48,352
Less: Reimbursement from Manager		137			–			1,172
Less: Reimbursement from Manager - Class A		20			–			12
Less: Reimbursement from Manager - Class B		N/A			2			N/A
Less: Reimbursement from Manager - Class P		17			2			18
Less: Reimbursement from Distributor - Class J		N/A			24			40
Total Net Expenses		4,766			23,430			47,110
Net Investment Income (Loss)		7,995			5,304			12,143

Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements
Net realized gain (loss) from:
Investment transactions		112,727			355,410			682,046
Foreign currency transactions		(471	)		–			–
Futures contracts		2,675			–			30,395
Change in unrealized appreciation/depreciation of:
Investments		(93,967	)		90,615			190,301
Futures contracts		(297	)		–			(2,009	)
Translation of assets and liabilities in foreign currencies		(193	)		–			–
Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements		20,474			446,025			900,733
Net Increase (Decrease) in Net Assets Resulting from Operations	$	28,469		$	451,329		$	912,876


STATEMENTS OF OPERATIONS
PRINCIPAL FUNDS, INC.
Year Ended October 31, 2014

	LargeCap S&P 500				LargeCap
Amounts in thousands	Index Fund				Value Fund ^(a)			MidCap Fund
Net Investment Income (Loss)
Income:
Dividends	$	78,769		$	71,083		$	91,579
Withholding tax		(14	)		–			(710	)
Interest		36			8			2
Total Income		78,791			71,091			90,871
Expenses:
Management and investment advisory fees		5,983			14,412			48,621
Distribution fees - Class A		342			523			4,961
Distribution fees - Class B		N/A			16			142
Distribution fees - Class C		216			78			3,514
Distribution fees - Class J		1,321			204			812
Distribution fees - R-1		65			5			90
Distribution fees - R-2		119			12			125
Distribution fees - R-3		596			10			389
Distribution fees - R-4		198			3			164
Administrative service fees - R-1		52			4			72
Administrative service fees - R-2		80			8			83
Administrative service fees - R-3		167			3			109
Administrative service fees - R-4		59			1			49
Administrative service fees - R-5		38			1			24
Registration fees - Class A		23			22			23
Registration fees - Class B		N/A			17			17
Registration fees - Class C		19			16			29
Registration fees - Class J		26			18			20
Registration fees - Class P		N/A			17			137
Registration fees - Institutional		29			1			166
Service fees - R-1		46			4			65
Service fees - R-2		100			10			104
Service fees - R-3		596			10			389
Service fees - R-4		495			7			409
Service fees - R-5		962			23			593
Shareholder reports - Class A		48			54			351
Shareholder reports - Class B		N/A			1			8
Shareholder reports - Class C		2			2			57
Shareholder reports - Class J		87			18			57
Shareholder reports - Class P		N/A			1			231
Shareholder reports - Institutional		20			20			302
Transfer agent fees - Class A		358			330			2,759
Transfer agent fees - Class B		N/A			12			37
Transfer agent fees - Class C		29			19			442
Transfer agent fees - Class J		386			95			165
Transfer agent fees - Class P		N/A			–			1,443
Transfer agent fees - Institutional		121			119			2,261
Custodian fees		11			7			10
Directors' expenses		60			58			126
Professional fees		31			29			39
Other expenses		68			13			82
Total Gross Expenses		12,753			16,203			69,477
Less: Reimbursement from Manager - Class B		N/A			21			–
Less: Reimbursement from Manager - Class C		19			13			–
Less: Reimbursement from Manager - Class P		N/A			17			–
Less: Reimbursement from Distributor - Class J		184			29			117
Total Net Expenses		12,550			16,123			69,360
Net Investment Income (Loss)		66,241			54,968			21,511

Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements
Net realized gain (loss) from:
Investment transactions		87,870			341,832			466,295
Foreign currency transactions		–			–			30
Futures contracts		14,353			5,620			–
Change in unrealized appreciation/depreciation of:
Investments		451,981			32,695			538,046
Futures contracts		(803	)		(984	)		–
Translation of assets and liabilities in foreign currencies		–			–			(1	)
Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements		553,401			379,163			1,004,370
Net Increase (Decrease) in Net Assets Resulting from Operations	$	619,642		$	434,131		$	1,025,881

^(a)Class P shares commenced operations on June 3, 2014.


STATEMENTS OF OPERATIONS
PRINCIPAL FUNDS, INC.
Year Ended October 31, 2014

		MidCap					Principal Capital
Amounts in thousands	Value Fund III ^(a)				Money Market Fund		Appreciation Fund
Net Investment Income (Loss)
Income:
Dividends	$	16,887		$	–	$	41,284
Withholding tax		(8	)		–		(190	)
Interest		13			1,806		9
Total Income		16,892			1,806		41,103
Expenses:
Management and investment advisory fees		5,601			4,274		10,793
Distribution fees - Class A		1			N/A		1,937
Distribution fees - Class B		N/A			47		259
Distribution fees - Class C		N/A			173		395
Distribution fees - Class J		310			649		N/A
Distribution fees - R-1		2			N/A		6
Distribution fees - R-2		4			N/A		7
Distribution fees - R-3		16			N/A		53
Distribution fees - R-4		9			N/A		15
Administrative service fees - R-1		2			N/A		5
Administrative service fees - R-2		3			N/A		5
Administrative service fees - R-3		4			N/A		15
Administrative service fees - R-4		3			N/A		4
Administrative service fees - R-5		1			N/A		3
Registration fees - Class A		17			111		12
Registration fees - Class B		N/A			19		17
Registration fees - Class C		N/A			21		19
Registration fees - Class J		17			40		N/A
Registration fees - Class P		16			N/A		15
Registration fees - Institutional		3			54		18
Service fees - R-1		2			N/A		4
Service fees - R-2		3			N/A		6
Service fees - R-3		16			N/A		54
Service fees - R-4		22			N/A		37
Service fees - R-5		36			N/A		88
Shareholder reports - Class A		1			51		144
Shareholder reports - Class B		N/A			1		12
Shareholder reports - Class C		N/A			2		8
Shareholder reports - Class J		27			85		N/A
Shareholder reports - Class P		1			N/A		3
Shareholder reports - Institutional		–			2		9
Transfer agent fees - Class A		3			477		703
Transfer agent fees - Class B		N/A			10		33
Transfer agent fees - Class C		N/A			24		56
Transfer agent fees - Class J		111			321		N/A
Transfer agent fees - Class P		1			N/A		19
Transfer agent fees - Institutional		29			13		35
Custodian fees		20			11		10
Directors' expenses		16			19		38
Professional fees		27			30		27
Other expenses		4			12		17
Total Gross Expenses		6,328			6,446		14,881
Less: Reimbursement from Manager		122			–		–
Less: Reimbursement from Manager - Class A		19			1,712		–
Less: Reimbursement from Manager - Class B		N/A			77		–
Less: Reimbursement from Manager - Class C		N/A			87		–
Less: Reimbursement from Manager - Class J		–			1,681		N/A
Less: Reimbursement from Manager - Class P		17			N/A		–
Less: Reimbursement from Manager - Institutional		–			877		–
Less: Reimbursement from Distributor - Class B		N/A			12		–
Less: Reimbursement from Distributor - Class C		N/A			174		–
Less: Reimbursement from Distributor - Class J		44			22		N/A
Total Net Expenses		6,126			1,804		14,881
Net Investment Income (Loss)		10,766			2		26,222

Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements
Net realized gain (loss) from:
Investment transactions		64,992			219		109,057
Futures contracts		3,892			–		–
Change in unrealized appreciation/depreciation of:
Investments		26,215			–		205,161
Futures contracts		(207	)		–		–
Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements		94,892			219		314,218
Net Increase (Decrease) in Net Assets Resulting from Operations	$	105,658		$	221	$	340,440

^(a)Class A and Class P shares commenced operations on June 3, 2014.


STATEMENTS OF OPERATIONS
PRINCIPAL FUNDS, INC.
Year Ended October 31, 2014

	Real Estate			Short-Term			SmallCap
Amounts in thousands	Securities Fund			Income Fund			Blend Fund ^(a)
Net Investment Income (Loss)
Income:
Dividends	$	35,800		$ –		$	5,379
Interest		2		44,859			2
Total Income		35,802		44,859			5,381
Expenses:
Management and investment advisory fees		13,398		8,747			3,875
Distribution fees - Class A		437		471			478
Distribution fees - Class B		35		N/A			31
Distribution fees - Class C		286		960			151
Distribution fees - Class J		429		340			588
Distribution fees - R-1		22		6			8
Distribution fees - R-2		47		5			9
Distribution fees - R-3		126		29			16
Distribution fees - R-4		54		7			4
Administrative service fees - R-1		18		4			7
Administrative service fees - R-2		31		4			6
Administrative service fees - R-3		35		8			5
Administrative service fees - R-4		16		2			1
Administrative service fees - R-5		14		1			1
Registration fees - Class A		27		35			23
Registration fees - Class B		17		N/A			16
Registration fees - Class C		18		21			16
Registration fees - Class J		22		25			18
Registration fees - Class P		20		26			16
Registration fees - Institutional		99		85			17
Service fees - R-1		16		4			6
Service fees - R-2		39		5			8
Service fees - R-3		126		28			15
Service fees - R-4		136		18			11
Service fees - R-5		352		16			31
Shareholder reports - Class A		42		32			48
Shareholder reports - Class B		2		N/A			2
Shareholder reports - Class C		6		11			3
Shareholder reports - Class J		66		24			51
Shareholder reports - Class P		5		2			–
Shareholder reports - Institutional		87		27			–
Transfer agent fees - Class A		307		292			347
Transfer agent fees - Class B		14		N/A			14
Transfer agent fees - Class C		51		107			30
Transfer agent fees - Class J		212		117			208
Transfer agent fees - Class P		32		41			–
Transfer agent fees - Institutional		489		233			4
Custodian fees		3		7			6
Directors' expenses		24		34			10
Professional fees		25		33			22
Other expenses		17		16			5
Total Gross Expenses		17,202		11,823			6,107
Less: Reimbursement from Manager - Class B		21		N/A			16
Less: Reimbursement from Manager - Class P		–		–			17
Less: Reimbursement from Manager - R-4		–		1			–
Less: Reimbursement from Distributor - Class J		57		50			84
Total Net Expenses		17,124		11,772			5,990
Net Investment Income (Loss)		18,678		33,087			(609	)

Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements
Net realized gain (loss) from:
Investment transactions		23,520		7,291			63,160
Futures contracts		–		–			1,325
Change in unrealized appreciation/depreciation of:
Investments		289,137		(12,438	)		(24,061	)
Futures contracts		–		–			(110	)
Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements		312,657		(5,147	)		40,314
Net Increase (Decrease) in Net Assets Resulting from Operations	$	331,335	$	27,940		$	39,705


^(a)Class P shares commenced operations on June 3, 2014.


STATEMENTS OF OPERATIONS PRINCIPAL FUNDS, INC. Year Ended October 31, 2014


		SmallCap			Tax-Exempt
Amounts in thousands		Value Fund II			Bond Fund
Net Investment Income (Loss)
Income:
Dividends	$	19,214		$	–
Withholding tax		(7	)		–
Interest		23			10,998
Total Income		19,230			10,998
Expenses:
Management and investment advisory fees		15,444			959
Distribution fees - Class A		–			508
Distribution fees - Class B		N/A			8
Distribution fees - Class C		N/A			92
Distribution fees - Class J		55			N/A
Distribution fees - R-1		7			N/A
Distribution fees - R-2		16			N/A
Distribution fees - R-3		31			N/A
Distribution fees - R-4		13			N/A
Administrative service fees - R-1		5			N/A
Administrative service fees - R-2		11			N/A
Administrative service fees - R-3		9			N/A
Administrative service fees - R-4		4			N/A
Administrative service fees - R-5		2			N/A
Registration fees - Class A		17			23
Registration fees - Class B		N/A			17
Registration fees - Class C		N/A			18
Registration fees - Class J		17			N/A
Registration fees - Class P		16			N/A
Registration fees - Institutional		20			N/A
Service fees - R-1		5			N/A
Service fees - R-2		14			N/A
Service fees - R-3		31			N/A
Service fees - R-4		32			N/A
Service fees - R-5		59			N/A
Shareholder reports - Class A		1			18
Shareholder reports - Class B		N/A			1
Shareholder reports - Class C		N/A			1
Shareholder reports - Class J		6			N/A
Shareholder reports - Institutional		16			N/A
Transfer agent fees - Class A		3			83
Transfer agent fees - Class B		N/A			7
Transfer agent fees - Class C		N/A			13
Transfer agent fees - Class J		33			N/A
Transfer agent fees - Institutional		86			N/A
Custodian fees		47			2
Directors' expenses		26			5
Interest expense and fees		–			60
Professional fees		28			28
Other expenses		10			3
Total Gross Expenses		16,064			1,846
Less: Reimbursement from Manager		379			–
Less: Reimbursement from Manager - Class A		20			–
Less: Reimbursement from Manager - Class B		N/A			23
Less: Reimbursement from Manager - Class C		N/A			20
Less: Reimbursement from Manager - Class P		17			N/A
Less: Reimbursement from Distributor - Class J		8			N/A
Total Net Expenses		15,640			1,803
Net Investment Income (Loss)		3,590			9,195

Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements
Net realized gain (loss) from:
Investment transactions		132,032			(1,982	)
Futures contracts		4,628			–
Change in unrealized appreciation/depreciation of:
Investments		1,248			14,045
Futures contracts		1,258			–
Net Realized and Unrealized Gain (Loss) on Investments, Foreign currencies,
Futures, Options and Swaptions, Short sales, and Swap agreements		139,166			12,063
Net Increase (Decrease) in Net Assets Resulting from Operations	$	142,756		$	21,258


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																				Bond & Mortgage Securities Fund
																				Year Ended						Year Ended
																				October 31, 2014						October 31, 2013
Operations
Net investment income (loss)																				$				66,246		$		58,461
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																								28,537				7,099
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																								16,182				(72,773	)
					Net Increase (Decrease) in Net Assets Resulting from Operations																	110,965						(7,213	)

Dividends and Distributions to Shareholders
From net investment income																								(73,012	)			(57,577	)
												Total Dividends and Distributions												(73,012	)			(57,577	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																						1,568,219						60,118
									Total Increase (Decrease) in Net Assets													1,606,172						(4,672	)

Net Assets
Beginning of period																						2,343,387						2,348,059
End of period (including undistributed net investment income as set forth below)																				$		3,949,559				$		2,343,387
Undistributed (overdistributed) net investment income (loss)																				$				1,288		$		5,447

			Class A		Class B		Class C		Class J			Institutional				R-1		R-2		R-3				R-4		R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold		$	10,462	$	5	$	949	$	13,189		$	1,668,533			$	977	$	3,424	$	5,145		$		6,468	$	9,858
Reinvested			2,351		21		92		3,877			63,712				100		264		661				652		1,138
Redeemed			(19,329	)	(468	)	(1,450	)	(26,874	)		(133,460	)			(2,469	)	(8,049	)	(11,688	)			(10,773	)	(9,099	)
Net Increase (Decrease)		$	(6,516	) $	(442	) $	(409	) $	(9,808)			$ 1,598,785		$		(1,392	) $	(4,361	) $	(5,882)			$	(3,653	) $	1,897
Shares:
Sold			964		–		87		1,203			152,458				90		316		476				586		912
Reinvested			216		2		9		353			5,844				9		24		61				59		105
Redeemed			(1,779	)	(43	)	(134	)	(2,457	)		(12,260	)			(226	)	(746	)	(1,080	)			(979	)	(842	)
Net Increase (Decrease)			(599	)	(41	)	(38	)	(901	)		146,042				(127	)	(406	)	(543	)			(334	)	175
Year Ended October 31, 2013
Dollars:
Sold		$	9,361	$	129	$	2,197	$	15,375		$	276,745		$		1,034	$	3,498	$	6,326		$		5,640	$	10,847
Reinvested			2,413		37		100		3,938			47,838				142		308		699				741		1,207
Redeemed			(29,381	)	(2,215	)	(3,946	)	(41,392	)		(175,397	)			(6,614	)	(7,729	)	(12,211	)			(12,276	)	(37,296	)
Net Increase (Decrease)	$	(17,607		) $	(2,049	) $	(1,649)		$ (22,079)			$ 149,186		$		(5,438	) $	(3,923	) $	(5,186)			$	(5,895)		$ (25,242)
Shares:
Sold			853		12		199		1,391			25,228				94		320		581				506		997
Reinvested			221		3		9		359			4,390				13		29		64				67		111
Redeemed			(2,699	)	(201	)	(362	)	(3,772	)		(16,100	)			(604	)	(713	)	(1,121	)			(1,113	)	(3,411	)
Net Increase (Decrease)			(1,625	)	(186	)	(154	)	(2,022	)		13,518				(497	)	(364	)	(476	)			(540	)	(2,303	)

Distributions:
Year Ended October 31, 2014
From net investment income			$(2,461	) $	(22	) $	(99	) $	(3,900)			$ (63,715)		$		(100	) $	(264	) $	(661)			$	(652	) $	(1,138	)
From net realized gain on
investments			–		–		–		–			–				–		–		–				–		–
Total Dividends and Distributions			$(2,461	) $	(22	) $	(99	) $	(3,900)			$ (63,715)		$		(100	) $	(264	) $	(661)			$	(652	) $	(1,138	)
Year Ended October 31, 2013
From net investment income			$(2,516	) $	(38	) $	(110	) $	(3,974)			$ (47,842)		$		(142	) $	(308	) $	(699)			$	(741	) $	(1,207	)
From net realized gain on
investments			–		–		–		–			–				–		–		–				–		–
Total Dividends and Distributions			$(2,516	) $	(38	) $	(110	) $	(3,974)			$ (47,842)		$		(142	) $	(308	) $	(699)			$	(741	) $	(1,207	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands										California Municipal Fund
										Year Ended		Year Ended
										October 31, 2014		October 31, 2013
Operations
Net investment income (loss)									$	8,041		$	8,971
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements										(1,654	)		16
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies										15,116			(15,089	)
					Net Increase (Decrease) in Net Assets Resulting from Operations					21,503			(6,102	)

Dividends and Distributions to Shareholders
From net investment income										(7,623	)		(9,071	)
							Total Dividends and Distributions			(7,623	)		(9,071	)

Capital Share Transactions
Net increase (decrease) in capital share transactions										40,983			(36,426	)
							Total Increase (Decrease) in Net Assets			54,863			(51,599	)

Net Assets
Beginning of period										172,704			224,303
End of period (including undistributed net investment income as set forth below)									$	227,567		$	172,704
Undistributed (overdistributed) net investment income (loss)									$	705		$	407

			Class A		Class B		Class C
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold		$	71,192	$	2	$	4,564
Reinvested			6,622		19		274
Redeemed			(38,829	)	(562	)	(2,299	)
Net Increase (Decrease)		$	38,985	$	(541	) $	2,539
Shares:
Sold			6,942		–		449
Reinvested			652		2		27
Redeemed			(3,849	)	(55	)	(228	)
Net Increase (Decrease)			3,745		(53	)	248
Year Ended October 31, 2013
Dollars:
Sold		$	34,654	$	1	$	2,402
Reinvested			7,791		41		319
Redeemed			(76,695	)	(795	)	(4,144	)
Net Increase (Decrease)	$	(34,250		) $	(753	) $	(1,423	)
Shares:
Sold			3,358		–		231
Reinvested			766		4		32
Redeemed			(7,655	)	(78	)	(415	)
Net Increase (Decrease)			(3,531	)	(74	)	(152	)

Distributions:
Year Ended October 31, 2014
From net investment income			$(7,308	) $	(19	) $	(296	)
From net realized gain on
investments			–		–		–
Total Dividends and Distributions			$(7,308	) $	(19	) $	(296	)
Year Ended October 31, 2013
From net investment income			$(8,694	) $	(41	) $	(336	)
From net realized gain on
investments			–		–		–
Total Dividends and Distributions			$(8,694	) $	(41	) $	(336	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																							Diversified International Fund
																							Year Ended						Year Ended
																							October 31, 2014						October 31, 2013
Operations
Net investment income (loss)																							$			80,393			$					76,677
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																								225,262							159,483
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																								(140,870			)				582,735
					Net Increase (Decrease) in Net Assets Resulting from Operations																			164,785							818,895

Dividends and Distributions to Shareholders
From net investment income																										(95,806	)							(73,597	)
														Total Dividends and Distributions												(95,806	)							(73,597	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																								540,865							692,021
												Total Increase (Decrease) in Net Assets												609,844							1,437,319

Net Assets
Beginning of period																								4,904,797							3,467,478
End of period (including undistributed net investment income as set forth below)																							$	5,514,641					$		4,904,797
Undistributed (overdistributed) net investment income (loss)																							$			56,939			$					61,573

			Class A		Class B		Class C					Class J		Class P			Institutional				R-1		R-2			R-3			R-4					R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold		$	20,149	$	47	$	3,199			$		17,207	$	3,568		$	735,763		$		940	$	1,757	$		4,913	$		6,851		$			15,333
Reinvested			3,534		3		111					3,246		29			85,163				69		144			808			821					1,444
Redeemed			(35,806	)	(1,547	)	(2,792	)				(27,473	)	(854	)		(238,628	)			(2,129	)	(4,557)			(12,231	)		(18,147)					(20,070	)
Net Increase (Decrease)	$	(12,123)		$	(1,497)	$	518			$		(7,020)	$	2,743		$	582,298		$		(1,120)	$	(2,656)		$	(6,510)		$	(10,475)				$	(3,293	)
Shares:
Sold			1,687		4		268					1,447		306			61,487				79		147			412			563					1,281
Reinvested			297		–		9					276		2			7,205				6		12			68			69					121
Redeemed			(2,981	)	(128	)	(232	)				(2,320	)	(72	)		(19,953	)			(178	)	(385)			(1,028	)		(1,505)					(1,647	)
Net Increase (Decrease)			(997	)	(124	)	45					(597	)	236			48,739				(93	)	(226)			(548	)		(873)					(245	)
Year Ended October 31, 2013
Dollars:
Sold		$	19,679	$	50	$	2,649			$		15,285	$	1,439		$	1,021,842			$	1,169	$	1,631	$		7,398	$		8,700		$			12,163
Reinvested			3,308		9		88					3,020		13			63,363				94		172			903			758					1,501
Redeemed			(38,997	)	(2,798	)	(2,006	)				(31,892	)	(864	)		(338,536	)			(3,521	)	(5,251)			(15,122	)		(8,104)					(26,122	)
Net Increase (Decrease)	$	(16,010)		$	(2,739	) $	731		$	(13,587)			$	588		$	746,669		$		(2,258	) $	(3,448)		$	(6,821)	$		1,354	$	(12,458				)
Shares:
Sold			1,822		4		241					1,423		134			95,501				111		154			707			806					1,128
Reinvested			323		1		9					298		1			6,218				9		17			89			73					146
Redeemed			(3,661	)	(260	)	(186	)				(3,023	)	(82	)		(31,380	)			(331	)	(504)			(1,412	)		(743)					(2,460	)
Net Increase (Decrease)			(1,516	)	(255	)	64					(1,302	)	53			70,339				(211	)	(333)			(616	)		136					(1,186	)

Distributions:
Year Ended October 31, 2014
From net investment income			$(3,910)	$	(3	) $	(116)				$	(3,248)	$	(36)		$	(85,207	)	$		(69	) $	(144)		$	(808)	$		(821)			$		(1,444	)
From net realized gain on
investments			–		–		–					–		–			–				–		–			–			–					–
Total Dividends and Distributions			$(3,910)	$	(3	) $	(116)				$	(3,248)	$	(36)		$	(85,207	)	$		(69	) $	(144)		$	(808)	$		(821)			$		(1,444	)
Year Ended October 31, 2013
From net investment income			$(3,622)	$	(9	) $	(93)				$	(3,023)	$	(19) $			(63,403	)	$		(94	) $	(172)		$	(903)	$		(758)			$		(1,501	)
From net realized gain on
investments			–		–		–					–		–			–				–		–			–			–					–
Total Dividends and Distributions			$(3,622)	$	(9	) $	(93)				$	(3,023)	$	(19) $			(63,403	)	$		(94	) $	(172)		$	(903)	$		(758)			$		(1,501	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																								Equity Income Fund
																								Year Ended								Year Ended
																								October 31, 2014								October 31, 2013
Operations
Net investment income (loss)																								$		141,668						$		137,876
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																										145,085								88,916
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																										545,843								737,128
						Net Increase (Decrease) in Net Assets Resulting from Operations																				832,596								963,920

Dividends and Distributions to Shareholders
From net investment income																										(120,648			)					(131,857	)
															Total Dividends and Distributions											(120,648			)					(131,857	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																												(8,569	)					209,818
												Total Increase (Decrease) in Net Assets														703,379								1,041,881

Net Assets
Beginning of period																										5,280,584								4,238,703
End of period (including undistributed net investment income as set forth below)																								$		5,983,963						$		5,280,584
Undistributed (overdistributed) net investment income (loss)																								$				44,589				$		26,571

		Class A				Class B		Class C				Class P			Institutional			R-1				R-2		R-3				R-4				R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	135,913			$	459	$	32,125		$		54,721		$	227,886		$	528		$		2,067	$	12,309		$		8,673		$		24,347
Reinvested		17,588				399		1,781				1,832			91,461			48				110		1,345				1,058				3,146
Redeemed		(200,992	)			(27,126	)	(25,429	)			(21,542	)		(296,228	)		(1,560	)			(4,758	)	(15,112	)			(12,788	)			(20,830	)
Net Increase (Decrease)	$	(47,491) $				(26,268) $		8,477		$		35,011		$	23,119		$	(984			) $	(2,581	) $	(1,458)			$	(3,057)			$	6,663
Shares:
Sold		5,525				19		1,328				2,181			9,180			21				83		496				353				980
Reinvested		702				16		73				73			3,644			2				4		54				42				125
Redeemed		(8,098	)			(1,098	)	(1,048	)			(869	)		(11,977	)		(62	)			(190	)	(605	)			(508	)			(841	)
Net Increase (Decrease)		(1,871	)			(1,063	)	353				1,385			847			(39	)			(103	)	(55	)			(113	)			264
Year Ended October 31, 2013
Dollars:
Sold	$	213,618			$	753	$	45,688		$		38,635		$	428,350		$	1,397		$		2,370	$	23,765		$		18,544		$		31,614
Reinvested		19,264				927		1,955				1,454			99,904			66				156		1,388				1,118				3,317
Redeemed		(164,866	)			(29,112	)	(21,260	)			(18,684	)		(450,676	)		(1,131	)			(2,669	)	(7,293	)			(8,148	)			(20,626	)
Net Increase (Decrease)	$	68,016		$	(27,432		) $	26,383		$		21,405		$	77,578		$	332		$		(143	) $	17,860		$		11,514		$		14,305
Shares:
Sold		9,987				36		2,140				1,811			20,305			67				114		1,126				903				1,493
Reinvested		915				45		95				69			4,740			3				7		66				53				157
Redeemed		(7,759	)			(1,373	)	(1,024	)			(872	)		(20,798	)		(55	)			(125	)	(343	)			(382	)			(983	)
Net Increase (Decrease)		3,143				(1,292	)	1,211				1,008			4,247			15				(4	)	849				574				667

Distributions:
Year Ended October 31, 2014
From net investment income		$ (18,209)				$(408	) $	(2,143			) $	(2,217)			$ (91,938)		$	(49			) $	(134	) $	(1,345			) $	(1,058			) $	(3,147	)
From net realized gain on
investments		–				–		–				–			–			–				–		–				–				–
Total Dividends and Distributions		$ (18,209)				$(408	) $	(2,143			) $	(2,217)			$ (91,938)		$	(49			) $	(134	) $	(1,345			) $	(1,058			) $	(3,147	)
Year Ended October 31, 2013
From net investment income		$ (19,995)				$(951	) $	(2,373			) $	(1,835)			$ (100,637)		$	(66			) $	(177	) $	(1,388			) $	(1,118			) $	(3,317	)
From net realized gain on
investments		–				–		–				–			–			–				–		–				–				–
Total Dividends and Distributions		$ (19,995)				$(951	) $	(2,373			) $	(1,835)			$ (100,637)		$	(66			) $	(177	) $	(1,388			) $	(1,118			) $	(3,317	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands														Global Diversified Income Fund
														Year Ended		Year Ended
														October 31, 2014		October 31, 2013
Operations
Net investment income (loss)													$	371,971		$	334,497
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements														255,197			10,186
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies														22,079			61,531
					Net Increase (Decrease) in Net Assets Resulting from Operations									649,247			406,214

Dividends and Distributions to Shareholders
From net investment income														(363,272	)		(329,143	)
From net realized gain on investments														–			(51,304	)
											Total Dividends and Distributions			(363,272	)		(380,447	)

Capital Share Transactions
Net increase (decrease) in capital share transactions														1,468,629			2,734,922
											Total Increase (Decrease) in Net Assets			1,754,604			2,760,689

Net Assets
Beginning of period														8,192,630			5,431,941
End of period (including undistributed net investment income as set forth below)													$	9,947,234		$	8,192,630
Undistributed (overdistributed) net investment income (loss)													$	84,319		$	53,706
		Class A			Class C			Class P			Institutional
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	870,398		$	665,254		$	1,925,041			$ 634,890
Reinvested		96,008			65,238			79,115			47,857

Redeemed		(1,257,572	)		(422,045)			(1,027,399)			(208,156	)
Net Increase (Decrease)	$	(291,166)			$ 308,447		$	976,757		$	474,591
Shares:
Sold		59,379			45,575			130,738			43,408
Reinvested		6,600			4,505			5,446			3,288
Redeemed		(85,592	)		(29,153	)		(70,823	)		(14,375	)
Net Increase (Decrease)		(19,613	)		20,927			65,361			32,321
Year Ended October 31, 2013
Dollars:
Sold	$	1,677,170		$	1,092,053			$ 1,746,491			$ 253,054
Reinvested		122,647			68,956			60,366			46,062

Redeemed		(1,159,172	)		(331,824	)		(661,608	)		(179,273	)
Net Increase (Decrease)	$	640,645		$	829,185		$	1,145,249			$ 119,843
Shares:
Sold		118,055			77,197			124,277			17,936
Reinvested		8,697			4,916			4,306			3,279
Redeemed		(82,763	)		(23,682	)		(47,183	)		(12,763	)
Net Increase (Decrease)		43,989			58,431			81,400			8,452

Distributions:
Year Ended October 31, 2014
From net investment income		$ (109,792)			$ (87,765)			$ (116,538)			$ (49,177)
From net realized gain on
investments		–			–			–			–
Total Dividends and Distributions		$ (109,792)			$ (87,765)			$ (116,538)			$ (49,177)
Year Ended October 31, 2013
From net investment income		$ (119,569)			$ (80,510)			$ (87,494)			$ (41,570)
From net realized gain on
investments		(18,897	)		(14,535	)		(11,126	)		(6,746	)
Total Dividends and Distributions		$ (138,466)			$ (95,045)			$ (98,620)			$ (48,316)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																Global Real Estate Securities Fund
																Year Ended			Year Ended
																October 31, 2014			October 31, 2013
Operations
Net investment income (loss)															$	28,858		$	24,616
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																35,031			75,494
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																156,170			78,134
						Net Increase (Decrease) in Net Assets Resulting from Operations										220,059			178,244

Dividends and Distributions to Shareholders
From net investment income																(39,949	)		(66,419	)
From net realized gain on investments																(52,789	)		(20,475	)
													Total Dividends and Distributions			(92,738	)		(86,894	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																591,598			414,241
													Total Increase (Decrease) in Net Assets			718,919			505,591

Net Assets
Beginning of period																1,616,299			1,110,708
End of period (including undistributed net investment income as set forth below)															$	2,335,218		$	1,616,299
Undistributed (overdistributed) net investment income (loss)															$	(5,820	)	$	(15,392	)

		Class A				Class C		Class P					Institutional
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	54,659		$		24,488		$		85,308		$	531,471
Reinvested		3,975				1,293				2,678			80,250
Redeemed		(33,165	)			(5,854	)			(34,861	)		(118,644	)
Net Increase (Decrease)	$	25,469		$		19,927		$		53,125		$	493,077
Shares:
Sold		6,773				3,084				9,818			61,008
Reinvested		511				172				323			9,706
Redeemed		(4,054	)			(734	)			(4,092	)		(13,766	)
Net Increase (Decrease)		3,230				2,522				6,049			56,948
Year Ended October 31, 2013
Dollars:
Sold	$	68,522		$		21,830		$		52,059		$	476,932
Reinvested		2,558				358				548			82,305
Redeemed		(23,288	)			(3,006	)			(10,009	)		(254,568	)
Net Increase (Decrease)	$	47,792		$		19,182		$		42,598		$	304,669
Shares:
Sold		8,430				2,735				6,073			56,216
Reinvested		326				47				66			9,937
Redeemed		(2,944	)			(380	)			(1,179	)		(29,658	)
Net Increase (Decrease)		5,812				2,402				4,960			36,495

Distributions:
Year Ended October 31, 2014
From net investment income		$(1,614)			$	(413)			$	(1,497)			$ (36,425)
From net realized gain on
investments		(2,514	)			(994	)			(1,879	)		(47,402	)
Total Dividends and Distributions		$(4,128)			$	(1,407)			$	(3,376)			$ (83,827)
Year Ended October 31, 2013
From net investment income		$(2,027)			$	(345)			$	(738)			$ (63,309)
From net realized gain on
investments		(599	)			(112	)			(142	)		(19,622	)
Total Dividends and Distributions		$(2,626)			$	(457)			$	(880)			$ (82,931)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



																			Government & High Quality Bond Fund
Amounts in thousands																			Government & High Quality Bond Fund
																			Year Ended					Year Ended
																			October 31, 2014					October 31, 2013
Operations
Net investment income (loss)																			$		40,336			$				42,852
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																					8,269							13,776
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																					10,453							(68,336	)
					Net Increase (Decrease) in Net Assets Resulting from Operations																59,058							(11,708	)

Dividends and Distributions to Shareholders
From net investment income																					(51,206	)						(56,413	)
From tax return of capital																					(230	)						–
											Total Dividends and Distributions										(51,436	)						(56,413	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																			(129,220			)						(67,328	)
									Total Increase (Decrease) in Net Assets										(121,598			)				(135,449			)

Net Assets
Beginning of period																			1,786,280					1,921,729
End of period (including undistributed net investment income as set forth below)																		$	1,664,682				$	1,786,280
Undistributed (overdistributed) net investment income (loss)																			$		(4,159	)		$				(2,287	)
			Class A		Class B		Class C		Class J		Class P		Institutional			R-1			R-2		R-3			R-4				R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold		$	23,479	$	45	$	7,502	$	14,083	$	2,634	$	35,749		$	681	$		938	$	4,095	$		3,101		$		6,326
Reinvested			9,331		93		1,313		3,718		203		34,703			63			123		445			310				553
Redeemed		(105,332		)	(2,054	)	(31,639	)	(27,446	)	(6,312	)	(87,871	)		(1,423	)		(1,373	)	(6,202	)		(3,269	)			(5,787	)
Net Increase (Decrease)	$	(72,522		) $	(1,916)		$ (22,824)	$	(9,645	) $	(3,475)		$ (17,419)		$	(679	) $		(312	) $	(1,662	) $		142		$		1,092
Shares:
Sold			2,139		4		684		1,281		239		3,272			62			85		373			283				575
Reinvested			851		9		120		339		19		3,162			6			11		40			28				50
Redeemed			(9,619	)	(188	)	(2,893	)	(2,504	)	(576	)	(7,995	)		(130	)		(125	)	(566	)		(298	)			(528	)
Net Increase (Decrease)			(6,629	)	(175	)	(2,089	)	(884	)	(318	)	(1,561	)		(62	)		(29	)	(153	)		13				97
Year Ended October 31, 2013
Dollars:
Sold		$	98,382	$	319	$	28,339	$	37,690	$	11,780		$ 163,086		$	788	$		1,082	$	5,614	$		4,376		$		6,117
Reinvested			13,044		168		2,113		4,272		420		33,716			84			145		534			332				591
Redeemed		(219,025		)	(5,076	)	(57,618	)	(47,996	)	(18,495	)	(105,626	)		(1,322	)		(2,284	)	(9,417	)		(4,680	)			(8,781	)
Net Increase (Decrease)	$	(107,599		) $	(4,589)		$ (27,166)	$	(6,034	) $	(6,295	) $	91,176		$	(450	) $		(1,057	) $	(3,269	) $		28		$		(2,073	)
Shares:
Sold			8,735		28		2,518		3,345		1,046		14,672			70			97		500			389				546
Reinvested			1,169		15		189		383		38		3,024			8			13		48			30				53
Redeemed			(19,719	)	(456	)	(5,206	)	(4,305	)	(1,660	)	(9,539	)		(118	)		(204	)	(841	)		(420	)			(781	)
Net Increase (Decrease)			(9,815	)	(413	)	(2,499	)	(577	)	(576	)	8,157			(40	)		(94	)	(293	)		(1	)			(182	)

Distributions:
Year Ended October 31, 2014
From net investment income			$(9,719	) $	(96	) $	(1,360	) $	(3,740	) $	(236)		$ (34,566)		$	(63	) $		(125	) $	(443	) $		(308			) $	(550	)
From net realized gain on
investments			–		–		–		–		–		–			–			–		–			–				–
From tax return of capital			(42	)	–		(5	)	(17	)	(1	)	(157	)		–			(1	)	(2	)		(2	)			(3	)
Total Dividends and Distributions			$(9,761	) $	(96	) $	(1,365	) $	(3,757	) $	(237)		$ (34,723)		$	(63	) $		(126	) $	(445	) $		(310			) $	(553	)
Year Ended October 31, 2013
From net investment income			$ (13,763)	$	(176	) $	(2,221	) $	(4,331	) $	(497)		$ (33,733)		$	(84	) $		(147	) $	(538	) $		(332			) $	(591	)
From net realized gain on
investments			–		–		–		–		–		–			–			–		–			–				–
Total Dividends and Distributions			$ (13,763)	$	(176	) $	(2,221	) $	(4,331	) $	(497)		$ (33,733)		$	(84	) $		(147	) $	(538	) $		(332			) $	(591	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands															High Yield Fund
															Year Ended		Year Ended
															October 31, 2014		October 31, 2013
Operations
Net investment income (loss)														$	225,102		$	239,594
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements															48,498			87,591
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies															(62,580	)		5,054
				Net Increase (Decrease) in Net Assets Resulting from Operations											211,020			332,239

Dividends and Distributions to Shareholders
From net investment income															(239,844	)		(247,907	)
From net realized gain on investments															(85,621	)		(32,621	)
												Total Dividends and Distributions			(325,465	)		(280,528	)

Capital Share Transactions
Net increase (decrease) in capital share transactions															(246,679	)		298,273
									Total Increase (Decrease) in Net Assets						(361,124	)		349,984

Net Assets
Beginning of period															4,123,630			3,773,646
End of period (including undistributed net investment income as set forth below)														$	3,762,506		$	4,123,630
Undistributed (overdistributed) net investment income (loss)														$	(4,790	)	$	(3,687	)
		Class A		Class B		Class C			Class P			Institutional
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	426,403	$	271	$	54,605		$	680,265		$	416,363
Reinvested		134,155		1,852		32,563			50,252			73,608

Redeemed		(1,287,497	)	(9,751	)	(122,090	)		(308,173	)		(389,505	)
Net Increase (Decrease)	$	(726,939	) $	(7,628)		$ (34,922)			$ 422,344		$	100,466
Shares:
Sold		54,372		34		6,897			86,607			53,715
Reinvested		17,162		236		4,133			6,430			9,514
Redeemed		(164,357	)	(1,236	)	(15,449	)		(39,394	)		(50,213	)
Net Increase (Decrease)		(92,823	)	(966	)	(4,419	)		53,643			13,016
Year Ended October 31, 2013
Dollars:
Sold	$	1,029,482	$	1,161	$	85,689		$	340,667		$	811,392
Reinvested		119,620		2,094		31,072			34,474			58,084

Redeemed		(1,039,467	)	(12,943	)	(168,758	)		(313,310	)		(680,984	)
Net Increase (Decrease)	$	109,635	$	(9,688)		$ (51,997)			$ 61,831		$	188,492
Shares:
Sold		130,670		147		10,740			43,159			103,439
Reinvested		15,146		264		3,904			4,363			7,444
Redeemed		(131,743	)	(1,630	)	(21,199	)		(39,665	)		(86,992	)
Net Increase (Decrease)		14,073		(1,219	)	(6,555	)		7,857			23,891

Distributions:
Year Ended October 31, 2014
From net investment income		$ (100,794)	$	(1,487)		$ (27,559)			$ (50,609)			$ (59,395)
From net realized gain on
investments		(40,698	)	(659	)	(11,297	)		(13,638	)		(19,329	)
Total Dividends and Distributions		$ (141,492)	$	(2,146)		$ (38,856)			$ (64,247)			$ (78,724)
Year Ended October 31, 2013
From net investment income		$ (116,527)	$	(2,130)		$ (33,249)			$ (39,973)			$ (56,028)
From net realized gain on
investments		(15,596	)	(344	)	(4,985	)		(4,930	)		(6,766	)
Total Dividends and Distributions		$ (132,123)	$	(2,474)		$ (38,234)			$ (44,903)			$ (62,794)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands						High Yield Fund I
						Year Ended		Year Ended
						October 31, 2014		October 31, 2013
Operations
Net investment income (loss)					$	91,505		$	83,690
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements						16,005			30,391
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies						(27,129	)		97
			Net Increase (Decrease) in Net Assets Resulting from Operations			80,381			114,178

Dividends and Distributions to Shareholders
From net investment income						(91,233	)		(150,072	)
From net realized gain on investments						(29,943	)		(34,647	)
			Total Dividends and Distributions			(121,176	)		(184,719	)

Capital Share Transactions
Net increase (decrease) in capital share transactions						305,020			409,234
			Total Increase (Decrease) in Net Assets			264,225			338,693

Net Assets
Beginning of period						1,528,206			1,189,513
End of period (including undistributed net investment income as set forth below)					$	1,792,431		$	1,528,206
Undistributed (overdistributed) net investment income (loss)					$	520		$	151
		Class A	Institutional
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	18,629	$ 374,769
Reinvested		1,970	118,060
Redeemed		(50,283)	(158,125)
Net Increase (Decrease)	$	(29,684)	$ 334,704
Shares:
Sold		1,749	35,256
Reinvested		186	11,143
Redeemed		(4,750)	(14,867)
Net Increase (Decrease)		(2,815)	31,532
Year Ended October 31, 2013 ^(a)
Dollars:
Sold	$	33,149	$ 596,357
Reinvested		57	181,856
Redeemed		(346)	(401,839	)
Net Increase (Decrease)	$	32,860	$ 376,374
Shares:
Sold		3,095	55,137
Reinvested		5	16,908
Redeemed		(32)	(37,634	)
Net Increase (Decrease)		3,068	34,411

Distributions:
Year Ended October 31, 2014
From net investment income		$(1,327)	$ (89,906)
From net realized gain on
investments		(644)	(29,299	)
Total Dividends and Distributions$		(1,971)	$ (119,205)
Year Ended October 31, 2013 ^(a)
From net investment income		$(57) $	(150,015	)
From net realized gain on
investments		–	(34,647	)
Total Dividends and Distributions		$(57) $	(184,662	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																								Income Fund
																							Year Ended							Year Ended
																							October 31, 2014							October 31, 2013
Operations
Net investment income (loss)																							$			91,471				$			90,264
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																										6,938							15,805
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																										27,302							(92,222	)
					Net Increase (Decrease) in Net Assets Resulting from Operations																			125,711									13,847

Dividends and Distributions to Shareholders
From net investment income																										(97,957	)						(97,119	)
													Total Dividends and Distributions													(97,957	)						(97,119	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																								371,600							177,976
									Total Increase (Decrease) in Net Assets															399,354									94,704

Net Assets
Beginning of period																								2,444,641							2,349,937
End of period (including undistributed net investment income as set forth below)																							$	2,843,995						$	2,444,641
Undistributed (overdistributed) net investment income (loss)																							$			(11,031	)			$			(8,775	)

		Class A			Class B		Class C		Class J				Class P			Institutional			R-1				R-2			R-3				R-4			R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold		$	54,330	$	206	$	9,756	$	22,997		$		28,518		$	339,640		$	5,912		$		1,293	$		10,136		$		8,004	$		39,682
Reinvested			9,350		170		1,692		2,995				458			79,892			230				46			733				650			1,145
Redeemed			(87,220	)	(3,628	)	(20,465	)	(21,760	)			(17,081	)		(60,128	)		(1,497	)			(295		)	(7,871	)			(2,961		)	(23,329	)
Net Increase (Decrease)	$	(23,540		) $	(3,252	) $	(9,017	) $	4,232		$		11,895		$	359,404		$	4,645		$		1,044	$		2,998		$		5,693	$		17,498
Shares:
Sold			5,575		21		998		2,358				2,915			34,784			606				132			1,036				821			4,090
Reinvested			961		17		173		307				47			8,189			23				5			75				66			117
Redeemed			(8,982	)	(373	)	(2,102	)	(2,241	)			(1,744	)		(6,187	)		(154	)			(30		)	(804	)			(303		)	(2,389	)
Net Increase (Decrease)			(2,446	)	(335	)	(931	)	424				1,218			36,786			475				107			307				584			1,818
Year Ended October 31, 2013
Dollars:
Sold		$	87,956	$	428	$	23,255	$	35,929		$		9,684		$	283,180		$	5,479		$		733	$		11,020		$		11,060	$		12,633
Reinvested			11,940		300		2,322		3,409				538			75,694			97				43			704				471			690
Redeemed		(133,492		)	(5,873	)	(35,544	)	(38,066	)			(11,827	)		(153,228	)		(971	)			(678		)	(5,938	)			(3,455		)	(10,517	)
Net Increase (Decrease)	$	(33,596		) $	(5,145	) $	(9,967	) $	1,272		$		(1,605)			$ 205,646		$	4,605		$		98	$		5,786		$		8,076	$		2,806
Shares:
Sold			8,918		43		2,347		3,636				980			28,797			559				74			1,120				1,121			1,280
Reinvested			1,220		31		236		348				55			7,722			10				4			71				48			70
Redeemed			(13,711	)	(598	)	(3,642	)	(3,895	)			(1,215	)		(15,692	)		(99	)			(69		)	(606	)			(354		)	(1,089	)
Net Increase (Decrease)			(3,573	)	(524	)	(1,059	)	89				(180	)		20,827			470				9			585				815			261

Distributions:
Year Ended October 31, 2014
From net investment income			$(9,698	) $	(185	) $	(1,796	) $	(3,044			) $	(522)			$ (79,903)		$	(230			) $	(51		) $	(733			) $	(650		) $	(1,145	)
From net realized gain on
investments			–		–		–		–				–			–			–				–			–				–			–
Total Dividends and Distributions			$(9,698	) $	(185	) $	(1,796	) $	(3,044			) $	(522)			$ (79,903)		$	(230			) $	(51		) $	(733			) $	(650		) $	(1,145	)
Year Ended October 31, 2013
From net investment income			$ (12,468)	$	(329	) $	(2,488	) $	(3,476			) $	(647)			$ (75,706)		$	(97			) $	(43		) $	(704			) $	(471		) $	(690	)
From net realized gain on
investments			–		–		–		–				–			–			–				–			–				–			–
Total Dividends and Distributions			$ (12,468)	$	(329	) $	(2,488	) $	(3,476			) $	(647)			$ (75,706)		$	(97			) $	(43		) $	(704			) $	(471		) $	(690	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																								Inflation Protection Fund
																								Year Ended						Year Ended
																								October 31, 2014						October 31, 2013
Operations
Net investment income (loss)																								$				11,871		$	6,242
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																												(4,364	)		813
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																												8,210			(59,825	)
				Net Increase (Decrease) in Net Assets Resulting from Operations																								15,717			(52,770	)

Dividends and Distributions to Shareholders
From net investment income																												–			(3,836	)
From net realized gain on investments																												(14,478	)		–
														Total Dividends and Distributions														(14,478	)		(3,836	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																										245,063					66,337
											Total Increase (Decrease) in Net Assets															246,302					9,731

Net Assets
Beginning of period																										818,698					808,967
End of period (including undistributed net investment income as set forth below)																								$		1,065,000				$	818,698
Undistributed (overdistributed) net investment income (loss)																								$				16,186		$	(404	)

		Class A		Class C		Class J					Institutional			R-1				R-2		R-3				R-4				R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	3,608	$	651	$	1,853		$	348,938				$	401		$		311	$	1,843		$		1,183		$		10,520
Reinvested		290		78		174					13,685			17				15		112				30				48
Redeemed		(6,481	)	(1,673	)	(3,104	)				(113,628	)		(414	)			(490	)	(2,442	)			(824	)			(9,638	)
Net Increase (Decrease)	$	(2,583	) $	(944	) $	(1,077)					$ 248,995		$	4		$		(164	) $	(487			) $	389		$		930
Shares:
Sold		416		78		219					40,803			49				37		218				139				1,253
Reinvested		35		9		21					1,639			2				2		14				4				6
Redeemed		(758	)	(201	)	(370	)				(13,207	)		(51	)			(59	)	(292	)			(97	)			(1,109	)
Net Increase (Decrease)		(307	)	(114	)	(130	)				29,235			–				(20	)	(60	)			46				150
Year Ended October 31, 2013
Dollars:
Sold	$	5,922	$	1,296	$	3,257		$	287,149				$	498		$		342	$	3,763		$		1,856		$		2,353
Reinvested		73		–		17					3,699			2				1		16				8				16
Redeemed		(15,526	)	(4,714	)	(7,639	)				(205,285	)		(1,319	)			(791	)	(2,420	)			(2,026	)			(4,211	)
Net Increase (Decrease)	$	(9,531	) $	(3,418	) $	(4,365)				$	85,563		$	(819			) $	(448	) $	1,359		$		(162			) $	(1,842	)
Shares:
Sold		644		143		364					32,260			56				39		423				207				264
Reinvested		8		–		2					398			–				–		2				1				1
Redeemed		(1,728	)	(540	)	(863	)				(23,299	)		(148	)			(89	)	(276	)			(232	)			(464	)
Net Increase (Decrease)		(1,076	)	(397	)	(497	)				9,359			(92	)			(50	)	149				(24	)			(199	)

Distributions:
Year Ended October 31, 2014
From net investment income		$– $		– $		–			$		–		$	–		$		– $		–		$		–		$		–
From net realized gain on
investments		(307	)	(90	)	(174	)				(13,685	)		(17	)			(15	)	(112	)			(30	)			(48	)
Total Dividends and Distributions		$(307	) $	(90	) $	(174)					$ (13,685)		$	(17			) $	(15	) $	(112			) $	(30			) $	(48	)
Year Ended October 31, 2013
From net investment income		$(77	) $	– $		(17				) $	(3,699	)	$	(2			) $	(1	) $	(16			) $	(8			) $	(16	)
From net realized gain on
investments		–		–		–					–			–				–		–				–				–
Total Dividends and Distributions		$(77	) $	– $		(17				) $	(3,699	)	$	(2			) $	(1	) $	(16			) $	(8			) $	(16	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																										International Emerging Markets Fund
																										Year Ended							Year Ended
																										October 31, 2014							October 31, 2013
Operations
Net investment income (loss)																										$		23,618					$		20,068
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																												14,598							9,546
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																												(28,938	)						48,017
					Net Increase (Decrease) in Net Assets Resulting from Operations																							9,278							77,631

Dividends and Distributions to Shareholders
From net investment income																												(14,005	)						(21,495	)
															Total Dividends and Distributions													(14,005	)						(21,495	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																										176,676							205,542
													Total Increase (Decrease) in Net Assets													171,949							261,678

Net Assets
Beginning of period																										1,887,407							1,625,729
End of period (including undistributed net investment income as set forth below)																									$	2,059,356						$	1,887,407
Undistributed (overdistributed) net investment income (loss)																										$		24,062					$		13,001
			Class A		Class B				Class C				Class J		Class P		Institutional				R-1					R-2		R-3					R-4		R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold		$	15,860	$	39		$		2,550			$	10,948	$	570	$	286,163		$		681		$			1,577	$	2,578		$			3,361	$	8,302
Reinvested			214		–				–				515		14		12,959				–					2		–					84		200
Redeemed			(22,842	)	(1,081	)			(2,441	)			(27,435	)	(1,055	)	(82,349	)			(1,632	)				(2,228	)	(7,048	)				(9,736	)	(12,094	)
Net Increase (Decrease)		$	(6,768	) $	(1,042)			$	109		$	(15,972		) $	(471	) $	216,773		$		(951			) $		(649	) $	(4,470			) $		(6,291	) $	(3,592	)
Shares:
Sold			634		2				108				459		23		11,765				29					65		106					137		339
Reinvested			9		–				–				22		1		534				–					–		–					3		8
Redeemed			(927	)	(47	)			(103	)			(1,164	)	(43	)	(3,347	)			(67	)				(93	)	(287	)				(399	)	(498	)
Net Increase (Decrease)			(284	)	(45	)			5				(683	)	(19	)	8,952				(38	)				(28	)	(181	)				(259	)	(151	)
Year Ended October 31, 2013
Dollars:
Sold		$	21,173	$	84		$		2,831			$	19,274	$	1,435	$	497,117		$		1,067		$			1,324	$	6,750		$			5,612	$	10,180
Reinvested			1,012		–				–				1,862		21		17,352				36					59		363					268		478
Redeemed			(33,460	)	(2,813	)			(4,366	)			(42,628	)	(1,343	)	(244,017	)			(2,085	)				(4,025	)	(26,148	)				(6,816	)	(15,055	)
Net Increase (Decrease)	$		(11,275	) $	(2,729			) $	(1,535)			$	(21,492) $		113	$	270,452		$		(982			) $		(2,642)		$ (19,035)			$		(936	) $	(4,397	)
Shares:
Sold			835		4				116				789		58		20,591				41					54		279					226		407
Reinvested			39		–				–				75		1		680				2					2		14					11		19
Redeemed			(1,327	)	(118	)			(179	)			(1,764	)	(54	)	(9,746	)			(85	)				(163	)	(1,081	)				(278	)	(606	)
Net Increase (Decrease)			(453	)	(114	)			(63	)			(900	)	5		11,525				(42	)				(107	)	(788	)				(41	)	(180	)

Distributions:
Year Ended October 31, 2014
From net investment income			$(217	) $	–		$		–			$	(516	) $	(18	) $	(12,968			) $	–		$			(2	) $	–		$			(84	)$	(200	)
From net realized gain on
investments			–		–				–				–		–		–				–					–		–					–		–
Total Dividends and Distributions			$(217	) $	–		$		–			$	(516	) $	(18	) $	(12,968			) $	–		$			(2	) $	–		$			(84	)$	(200	)
Year Ended October 31, 2013
From net investment income			$(1,027	) $	–		$		–			$	(1,864	) $	(32	) $	(17,368			) $	(36			)$		(59	) $	(363			) $		(268	) $	(478	)
From net realized gain on
investments			–		–				–				–		–		–				–					–		–					–		–
Total Dividends and Distributions			$(1,027	) $	–		$		–			$	(1,864	) $	(32	) $	(17,368			) $	(36			)$		(59	) $	(363			) $		(268	) $	(478	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																	International Fund I
																	Year Ended				Year Ended
																	October 31, 2014				October 31, 2013
Operations
Net investment income (loss)																	$		7,995		$	10,504
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																			114,931			120,943
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																			(94,457	)		55,019
				Net Increase (Decrease) in Net Assets Resulting from Operations															28,469			186,466

Dividends and Distributions to Shareholders
From net investment income																			(9,947	)		(21,369	)
											Total Dividends and Distributions								(9,947	)		(21,369	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																			(288,580	)		(619,990	)
									Total Increase (Decrease) in Net Assets										(270,058	)		(454,893	)

Net Assets
Beginning of period																			642,604			1,097,497
End of period (including undistributed net investment income as set forth below)																	$		372,546		$	642,604
Undistributed (overdistributed) net investment income (loss)																	$		7,271		$	8,720
		Class A		Class P			Institutional		R-1		R-2		R-3		R-4		R-5
Capital Share Transactions:
Year Ended October 31, 2014 ^(a)
Dollars:
Sold	$	758	$	10		$	28,563	$	555	$	660	$	863	$	942	$	1,626
Reinvested		–		–			9,590		36		31		71		96		123
Redeemed		(1	)	–			(321,595	)	(1,281	)	(1,901	)	(2,390	)	(3,758	)	(1,578	)
Net Increase (Decrease)	$	757	$	10	$	(283,442		) $	(690	) $	(1,210	) $	(1,456	) $	(2,720	) $	171
Shares:
Sold		57		1			2,136		42		50		65		71		122
Reinvested		–		–			728		3		2		5		7		9
Redeemed		–		–			(24,432	)	(97	)	(143	)	(178	)	(287	)	(119	)
Net Increase (Decrease)		57		1			(21,568	)	(52	)	(91	)	(108	)	(209	)	12
Year Ended October 31, 2013
Dollars:
Sold		N/A		N/A		$	63,921	$	743	$	767	$	1,793	$	2,707	$	2,010
Reinvested		N/A		N/A			20,990		44		48		75		104		108
Redeemed		N/A		N/A			(702,875	)	(1,162	)	(1,664	)	(3,822	)	(2,352	)	(1,425	)
Net Increase (Decrease)		N/A		N/A	$	(617,964		) $	(375	) $	(849	)$	(1,954	) $	459	$	693
Shares:
Sold		N/A		N/A			5,477		63		66		153		238		168
Reinvested		N/A		N/A			1,871		4		4		7		9		9
Redeemed		N/A		N/A			(59,615	)	(100	)	(143	)	(333	)	(201	)	(122	)
Net Increase (Decrease)		N/A		N/A			(52,267	)	(33	)	(73	)	(173	)	46		55

Distributions:
Year Ended October 31, 2014 ^(a)
From net investment income		$– $		–		$	(9,590	) $	(36	)$	(31	)$	(71	) $	(96	)$	(123	)
From net realized gain on
investments		–		–			–		–		–		–		–		–
Total Dividends and Distributions		$– $		–		$	(9,590	) $	(36	)$	(31	)$	(71	) $	(96	)$	(123	)
Year Ended October 31, 2013
From net investment income		N/A		N/A		$	(20,990	) $	(44	)$	(48	)$	(75	) $	(104	) $	(108	)
From net realized gain on
investments		N/A		N/A			–		–		–		–		–		–
Total Dividends and Distributions		N/A		N/A		$	(20,990	) $	(44	)$	(48	)$	(75	) $	(104	) $	(108	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																														LargeCap Growth Fund
																													Year Ended					Year Ended
																													October 31, 2014					October 31, 2013
Operations
Net investment income (loss)																													$			5,304		$				15,720
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																														355,410						422,449
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																																90,615				261,969
							Net Increase (Decrease) in Net Assets Resulting from Operations																							451,329						700,138

Dividends and Distributions to Shareholders
From net investment income																																(8,242	)					(14,845	)
From net realized gain on investments																														(321,764			)					–
																			Total Dividends and Distributions											(330,006			)					(14,845	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																														184,837								(9,176	)
															Total Increase (Decrease) in Net Assets															306,160						676,117

Net Assets
Beginning of period																														3,076,001						2,399,884
End of period (including undistributed net investment income as set forth below)																													$	3,382,161				$		3,076,001
Undistributed (overdistributed) net investment income (loss)																													$			2,999		$				5,873

			Class A				Class B				Class C				Class J				Class P			Institutional			R-1				R-2			R-3		R-4				R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold		$	19,885		$		180		$		2,879		$		14,359		$		1,793		$	170,325		$	1,108		$		1,402	$		2,441	$	4,289		$		7,047
Reinvested			36,950				767				1,404				6,348				966			269,390			734				793			2,238		1,869				6,975
Redeemed			(45,822	)			(2,193	)			(2,948	)			(14,578	)			(2,740	)		(264,556	)		(2,238	)			(3,814		)	(6,981	)	(11,000			)	(12,435	)
Net Increase (Decrease)		$	11,013		$		(1,246			) $	1,335		$		6,129		$		19		$	175,159		$	(396			) $	(1,619		) $	(2,302	) $	(4,842			) $	1,587
Shares:
Sold			1,836				18				283				1,385				160			15,158			104				129			212		380				633
Reinvested			3,560				81				144				642				90			25,130			73				78			204		172				648
Redeemed			(4,212	)			(221	)			(287	)			(1,408	)			(242	)		(23,564	)		(213	)			(357		)	(610	)	(985			)	(1,102	)
Net Increase (Decrease)			1,184				(122	)			140				619				8			16,724			(36	)			(150		)	(194	)	(433			)	179
Year Ended October 31, 2013
Dollars:
Sold		$	20,145		$		82		$		2,858		$		8,594		$		10,762		$	697,281		$	1,071		$		1,947	$		2,432	$	5,731		$		18,858
Reinvested			344				–				–				113				57			13,604			–				–			12		38				587
Redeemed			(46,388	)			(3,518	)			(2,183	)			(10,861	)			(3,912	)		(593,230	)		(4,861	)			(5,131		)	(11,630	)	(5,166			)	(106,812	)
Net Increase (Decrease)	$	(25,899				) $	(3,436			) $	675		$		(2,154			) $	6,907		$	117,655		$	(3,790			) $	(3,184		) $	(9,186	) $	603	$	(87,367			)
Shares:
Sold			2,063				10				303				908				1,168			67,195			113				202			235		565				1,849
Reinvested			39				–				–				13				6			1,505			–				–			1		4				65
Redeemed			(4,800	)			(392	)			(240	)			(1,158	)			(406	)		(58,772	)		(519	)			(541)			(1,138	)	(498			)	(10,556	)
Net Increase (Decrease)			(2,698	)			(382	)			63				(237	)			768			9,928			(406	)			(339)			(902	)	71				(8,642	)

Distributions:
Year Ended October 31, 2014
From net investment income			$–		$		–		$		–		$		–		$		(16)		$	(8,226	)	$	–		$		–	$		– $		–		$		–
From net realized gain on
investments			(37,387	)			(773	)			(1,627	)			(6,349	)			(1,092	)		(261,921	)		(734	)			(799		)	(2,238	)	(1,869			)	(6,975	)
Total Dividends and Distributions			$ (37,387)			$	(773			) $	(1,627			) $	(6,349			) $	(1,108)			$ (270,147)		$	(734			) $	(799		) $	(2,238	) $	(1,869			) $	(6,975	)
Year Ended October 31, 2013
From net investment income			$(350			) $	–		$		–		$		(113			) $	(67)		$	(13,678	)	$	–		$		–	$		(12	) $	(38			) $	(587	)
From net realized gain on
investments			–				–				–				–				–			–			–				–			–		–				–
Total Dividends and Distributions			$(350			) $	–		$		–		$		(113			) $	(67)		$	(13,678	)	$	–		$		–	$		(12	) $	(38			) $	(587	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																												LargeCap Growth Fund I
																												Year Ended							Year Ended
																												October 31, 2014						October 31, 2013
Operations
Net investment income (loss)																												$				12,143		$	22,059
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																														712,441					406,373
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																														188,292					1,262,445
						Net Increase (Decrease) in Net Assets Resulting from Operations																								912,876					1,690,877

Dividends and Distributions to Shareholders
From net investment income																																(10,198	)		(25,087	)
From net realized gain on investments																														(419,282			)		(214,462	)
															Total Dividends and Distributions															(429,480			)		(239,549	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																														414,714					465,703
												Total Increase (Decrease) in Net Assets																		898,110					1,917,031

Net Assets
Beginning of period																														6,860,747					4,943,716
End of period (including undistributed net investment income as set forth below)																												$		7,758,857				$	6,860,747
Undistributed (overdistributed) net investment income (loss)																												$				8,064		$	5,940
		Class A				Class J				Class P		Institutional			R-1				R-2				R-3					R-4				R-5
Capital Share Transactions:
Year Ended October 31, 2014 ^(b)
Dollars:
Sold	$	5,582		$		19,593		$		17	$	750,471		$	1,539		$		10,189		$		21,800			$		18,656		$		82,776
Reinvested		157				6,610				–		388,891			525				1,349				9,776					6,356				15,808
Redeemed		(1,348	)			(20,808	)			–		(790,030	)		(2,638	)			(7,556	)			(27,876	)				(35,859	)			(39,266	)
Net Increase (Decrease)	$	4,391		$		5,395		$		17	$	349,332		$	(574			) $	3,982		$		3,700		$			(10,847)			$	59,318
Shares:
Sold		437				1,730				1		58,456			130				870				1,790					1,519				6,589
Reinvested		13				603				–		31,307			46				120				828					535				1,302
Redeemed		(106	)			(1,838	)			–		(61,708	)		(221	)			(653	)			(2,271	)				(2,923	)			(3,116	)
Net Increase (Decrease)		344				495				1		28,055			(45	)			337				347					(869	)			4,775
Year Ended October 31, 2013 ^(a)
Dollars:
Sold	$	1,643		$		18,887				N/A	$	723,800		$	2,216		$		3,151		$		45,350			$		29,956		$		63,541
Reinvested		–				3,303				N/A		219,287			280				616				4,562					3,019				8,478
Redeemed		(56	)			(15,610	)			N/A		(552,830	)		(1,311	)			(4,599	)			(19,108	)				(15,340	)			(53,532	)
Net Increase (Decrease)	$	1,587		$		6,580				N/A	$	390,257		$	1,185		$		(832			) $	30,804			$		17,635		$		18,487
Shares:
Sold		141				1,901				N/A		66,519			212				319				4,404					2,877				5,770
Reinvested		–				372				N/A		21,973			30				68				478					315				867
Redeemed		(5	)			(1,606	)			N/A		(49,888	)		(132	)			(462	)			(1,841	)				(1,449	)			(5,133	)
Net Increase (Decrease)		136				667				N/A		38,604			110				(75	)			3,041					1,743				1,504

Distributions:
Year Ended October 31, 2014 ^(b)
From net investment income		$–		$		–		$		–	$	(10,198	)	$	–		$		–		$		–			$		–		$		–
From net realized gain on
investments		(159	)			(6,612	)			–		(378,697	)		(525	)			(1,349	)			(9,776	)				(6,356	)			(15,808	)
Total Dividends and Distributions		$(159			) $	(6,612			) $	–	$	(388,895	)	$	(525			) $	(1,349			) $	(9,776)				$	(6,356)				$ (15,808)
Year Ended October 31, 2013 ^(a)
From net investment income		$–		$		(56	)			N/A	$	(24,207	)	$	–		$		–		$		(83				) $	(171			) $	(570	)
From net realized gain on
investments		–				(3,251	)			N/A		(195,080	)		(280	)			(616	)			(4,479	)				(2,848	)			(7,908	)
Total Dividends and Distributions		$–		$		(3,307	)			N/A	$	(219,287	)	$	(280)			$	(616			) $	(4,562)				$	(3,019			) $	(8,478	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																								LargeCap S&P 500 Index Fund
																								Year Ended						Year Ended
																								October 31, 2014						October 31, 2013
Operations
Net investment income (loss)																								$				66,241		$	60,376
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																										102,223					35,515
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																										451,178					670,382
						Net Increase (Decrease) in Net Assets Resulting from Operations																				619,642					766,273

Dividends and Distributions to Shareholders
From net investment income																												(58,505	)		(52,369	)
																Total Dividends and Distributions												(58,505	)		(52,369	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																												(23,330	)		180,781
													Total Increase (Decrease) in Net Assets													537,807					894,685

Net Assets
Beginning of period																										3,711,217					2,816,532
End of period (including undistributed net investment income as set forth below)																								$		4,249,024				$	3,711,217
Undistributed (overdistributed) net investment income (loss)																								$				52,094		$	44,444

		Class A				Class C				Class J			Institutional			R-1		R-2		R-3				R-4				R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	35,762		$		8,653		$		67,423		$	312,186		$	3,620	$	5,777	$	49,241		$		44,525		$		89,806
Reinvested		2,829				165				6,021			38,393			145		420		2,629				2,536				5,308
Redeemed		(35,865	)			(3,661	)			(66,708	)		(387,960	)		(6,272	)	(17,407	)	(56,388	)			(39,107	)			(85,401	)
Net Increase (Decrease)	$	2,726		$		5,157		$		6,736		$	(37,381	)	$	(2,507)		$ (11,210)	$	(4,518			) $	7,954		$		9,713
Shares:
Sold		2,690				661				5,087			23,463			273		434		3,686				3,314				6,675
Reinvested		222				13				476			3,013			11		33		206				198				411
Redeemed		(2,705	)			(280	)			(5,055	)		(29,127	)		(473	)	(1,322	)	(4,163	)			(2,916	)			(6,381	)
Net Increase (Decrease)		207				394				508			(2,651	)		(189	)	(855	)	(271	)			596				705
Year Ended October 31, 2013
Dollars:
Sold	$	33,712		$		8,063		$		54,570		$	312,955		$	3,366	$	7,456	$	48,545		$		44,948		$		90,170
Reinvested		2,443				86				5,619			34,383			188		443		2,673				2,019				4,470
Redeemed		(29,919	)			(2,454	)			(59,727	)		(233,262	)		(5,684	)	(10,686	)	(45,175	)			(21,588	)			(66,833	)
Net Increase (Decrease)	$	6,236		$		5,695		$		462		$	114,076		$	(2,130	) $	(2,787	) $	6,043		$		25,379		$		27,807
Shares:
Sold		2,983				708				4,927			28,167			304		667		4,454				4,041				8,094
Reinvested		244				9				566			3,442			19		44		267				201				442
Redeemed		(2,719	)			(226	)			(5,451	)		(20,951	)		(510	)	(992	)	(4,073	)			(1,953	)			(6,092	)
Net Increase (Decrease)		508				491				42			10,658			(187	)	(281	)	648				2,289				2,444

Distributions:
Year Ended October 31, 2014
From net investment income		$(2,878			) $	(173			) $	(6,023)			$ (38,393)		$	(145	) $	(420	) $	(2,629)			$	(2,536			) $	(5,308	)
From net realized gain on
investments		–				–				–			–			–		–		–				–				–
Total Dividends and Distributions		$(2,878			) $	(173			) $	(6,023)			$ (38,393)		$	(145	) $	(420	) $	(2,629)			$	(2,536			) $	(5,308	)
Year Ended October 31, 2013
From net investment income		$(2,480			) $	(88			) $	(5,624)			$ (34,384)		$	(188	) $	(443	) $	(2,673)			$	(2,019			) $	(4,470	)
From net realized gain on
investments		–				–				–			–			–		–		–				–				–
Total Dividends and Distributions		$(2,480			) $	(88			) $	(5,624)			$ (34,384)		$	(188	) $	(443	) $	(2,673)			$	(2,019			) $	(4,470	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																													LargeCap Value Fund
																												Year Ended							Year Ended
																												October 31, 2014							October 31, 2013
Operations
Net investment income (loss)																												$			54,968				$			45,181
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																													347,452							337,209
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																															31,711					162,013
						Net Increase (Decrease) in Net Assets Resulting from Operations																							434,131							544,403

Dividends and Distributions to Shareholders
From net investment income																															(43,181	)						(38,399	)
From net realized gain on investments																													(284,484			)						–
																Total Dividends and Distributions													(327,665			)						(38,399	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																													343,452							943,708
												Total Increase (Decrease) in Net Assets																	449,918							1,449,712

Net Assets
Beginning of period																													3,299,447							1,849,735
End of period (including undistributed net investment income as set forth below)																												$	3,749,365						$	3,299,447
Undistributed (overdistributed) net investment income (loss)																												$			43,254				$			31,324

		Class A				Class B		Class C				Class J				Class P			Institutional				R-1				R- 2				R-3				R-4			R-5
Capital Share Transactions:
Year Ended October 31, 2014 ^(a)
Dollars:
Sold	$	11,300		$		9	$	1,492		$		10,629		$		606		$	223,109		$		443		$			850	$		1,234		$		899	$		1,836
Reinvested		18,636				143		653				6,611				–			299,062				141					258			359				256			921
Redeemed		(26,473	)			(642	)	(1,409	)			(12,664	)			(409	)		(186,818	)			(724	)				(561)			(915	)			(1,362		)	(4,018	)
Net Increase (Decrease)	$	3,463		$		(490	) $	736		$		4,576		$		197		$	335,353		$		(140)			$		547	$		678		$		(207)		$	(1,261	)
Shares:
Sold		847				1		114				811				45			16,738				34					64			92				68			137
Reinvested		1,457				11		52				525				–			23,401				11					20			28				20			72
Redeemed		(1,983	)			(48	)	(108	)			(964	)			(30	)		(14,111	)			(55	)				(42)		)	(69	)			(103		)	(311	)
Net Increase (Decrease)		321				(36	)	58				372				15			26,028				(10	)				42			51				(15		)	(102	)
Year Ended October 31, 2013
Dollars:
Sold	$	14,716		$		166	$	5,077		$		16,036				N/A		$	1,082,848			$	299		$			1,372	$		839		$		2,299	$		10,903
Reinvested		2,556				4		21				847				N/A			34,555				14					25			46				34			234
Redeemed		(23,203	)			(1,141	)	(1,085	)			(12,827	)			N/A			(177,337	)			(199	)				(470		)	(621	)			(2,310		)	(9,990	)
Net Increase (Decrease)	$	(5,931			) $	(971	) $	4,013		$		4,056				N/A		$	940,066		$		114		$			927	$		264		$		23	$		1,147
Shares:
Sold		1,205				13		419				1,348				N/A			84,103				26					109			70				190			963
Reinvested		235				–		2				79				N/A			3,185				1					2			4				3			21
Redeemed		(1,918	)			(94	)	(86	)			(1,075	)			N/A			(14,477	)			(17	)				(40)			(52	)			(187		)	(804	)
Net Increase (Decrease)		(478	)			(81	)	335				352				N/A			72,811				10					71			22				6			180

Distributions:
Year Ended October 31, 2014 ^(a)
From net investment income $		(1,842			) $	– $		(39			) $	(638			) $	–		$	(40,471	)	$		(9)			$		(27)		$	(32)			$	(26)		$	(97	)
From net realized gain on
investments		(17,308	)			(147	)	(648	)			(5,974	)			–			(258,591	)			(132	)				(303)			(327	)			(230		)	(824	)
Total Dividends and Distributions	$	(19,150)			$	(147	) $	(687			) $	(6,612			) $	–		$	(299,062	)	$		(141)			$		(330)		$	(359)			$	(256)		$	(921	)
Year Ended October 31, 2013
From net investment income		$(2,617			) $	(4	) $	(22			) $	(848	)			N/A		$	(34,555	)	$		(14)			$		(25)		$	(46)			$	(34)		$	(234	)
From net realized gain on
investments		–				–		–				–				N/A			–				–					–			–				–			–
Total Dividends and Distributions		$(2,617			) $	(4	) $	(22			) $	(848	)			N/A		$	(34,555	)	$		(14)			$		(25)		$	(46)			$	(34)		$	(234	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																																	MidCap Fund
																												Year Ended									Year Ended
																												October 31, 2014									October 31, 2013
Operations
Net investment income (loss)																											$						21,511				$					20,318
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																														466,325										164,411
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																														538,045										1,292,913
							Net Increase (Decrease) in Net Assets Resulting from Operations																							1,025,881										1,477,642

Dividends and Distributions to Shareholders
From net investment income																																	(10,518	)								(40,041	)
From net realized gain on investments																														(159,328				)								(57,420	)
															Total Dividends and Distributions															(169,846				)								(97,461	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																														698,018										2,260,384
													Total Increase (Decrease) in Net Assets																	1,554,053										3,640,565

Net Assets
Beginning of period																												7,311,173												3,670,608
End of period (including undistributed net investment income as set forth below)																											$	8,865,226									$			7,311,173
Undistributed (overdistributed) net investment income (loss)																											$						21,684				$					(6,500	)
			Class A				Class B		Class C				Class J		Class P				Institutional				R-1					R-2					R-3				R-4					R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	330,287			$		228	$	19,402		$		3,024	$	948,638			$	1,244,296		$		14,086		$			10,914		$			35,467		$		48,061			$		90,725
Reinvested			39,608				337		6,130				6,288		25,793				51,356				469					667					3,362				3,588					4,569
Redeemed		(700,282		)			(4,491	)	(52,154	)			(35,301	)	(565,546	)			(645,816	)			(5,418	)				(15,737	)				(51,222	)			(62,749	)				(50,561	)
Net Increase (Decrease)	$	(330,387)				$	(3,926)	$	(26,622)				$ (25,989)	$	408,885		$		649,836		$		9,137		$			(4,156)				$	(12,393)				$ (11,100)			$		44,733
Shares:
Sold			16,116				12		1,003				152		45,109				59,682				711					549					1,745				2,309					4,392
Reinvested			2,003				18		326				329		1,288				2,556				25					35					172				179					230
Redeemed			(33,620	)			(229	)	(2,664	)			(1,775	)	(26,642	)			(30,825	)			(275	)				(783	)				(2,522	)			(3,015	)				(2,434	)
Net Increase (Decrease)			(15,501	)			(199	)	(1,335	)			(1,294	)	19,755				31,413				461					(199	)				(605	)			(527	)				2,188
Year Ended October 31, 2013
Dollars:
Sold	$	863,981			$		579		$178,517				$35,361	$	707,274		$1,438,002				$		12,913		$			23,384		$			77,548		$		68,211		$	114,519
Reinvested			25,868				286		2,350				5,348		12,709				33,991				202					395					1,976				2,310					2,162
Redeemed		(413,722		)			(8,757	)	(22,310	)			(41,363	)	(186,332	)			(566,559	)			(3,537	)				(12,167	)				(30,323	)			(29,950	)				(32,482	)
Net Increase (Decrease)	$	476,127			$		(7,892)		$158,557		$		(654)	$	533,651		$		905,434		$		9,578		$			11,612		$			49,201		$		40,571			$		84,199
Shares:
Sold			49,698				35		10,928				2,172		39,614				81,129				764					1,390					4,494				3,881					6,541
Reinvested			1,655				19		157				354		805				2,148				14					26					128				146					137
Redeemed			(23,698	)			(528	)	(1,328	)			(2,487	)	(10,472	)			(31,551	)			(210	)				(709	)				(1,761	)			(1,687	)				(1,841	)
Net Increase (Decrease)			27,655				(474	)	9,757				39		29,947				51,726				568					707					2,861				2,340					4,837

Distributions:
Year Ended October 31, 2014
From net investment income $			–		$		– $		–		$		– $		(2,790)			$	(7,502)			$	–		$			–		$			–		$		–			$		(226	)
From net realized gain on
investments			(42,407	)			(342	)	(7,771	)			(6,290	)	(27,586	)			(62,266	)			(470	)				(900	)				(3,362	)			(3,588	)				(4,346	)
Total Dividends and Distributions $			(42,407)			$	(342)	$	(7,771)			$	(6,290	)$	(30,376)			$	(69,768)			$	(470)			$		(900)			$		(3,362)			$	(3,588)				$	(4,572	)
Year Ended October 31, 2013
From net investment income $			(10,317)			$	– $		(869)			$	(1,896	)$	(5,990)			$	(18,191)			$	(69)			$		(161)			$		(749)			$	(907)				$	(892	)
From net realized gain on
investments			(17,330	)			(292	)	(2,230	)			(3,460	)	(7,863	)			(21,867	)			(133	)				(343	)				(1,227	)			(1,403	)				(1,272	)
Total Dividends and Distributions $			(27,647)			$	(292)	$	(3,099)			$	(5,356	)$	(13,853)			$	(40,058)			$	(202)			$		(504)			$		(1,976)			$	(2,310)				$	(2,164	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																			MidCap Value Fund III
																			Year Ended					Year Ended
																			October 31, 2014					October 31, 2013
Operations
Net investment income (loss)																			$			10,766		$	6,404
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																						68,884			29,578
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																						26,008			93,123
					Net Increase (Decrease) in Net Assets Resulting from Operations															105,658					129,105

Dividends and Distributions to Shareholders
From net investment income																						(8,655	)		(1,226	)
From net realized gain on investments																						(22,025	)		–
													Total Dividends and Distributions									(30,680	)		(1,226	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																				140,054					542,115
									Total Increase (Decrease) in Net Assets											215,032					669,994

Net Assets
Beginning of period																				765,262					95,268
End of period (including undistributed net investment income as set forth below)																			$	980,294				$	765,262
Undistributed (overdistributed) net investment income (loss)																			$			8,138		$	5,974
		Class A			Class J		Class P	Institutional					R-1		R-2		R-3		R-4			R-5
Capital Share Transactions:
Year Ended October 31, 2014 ^(a)
Dollars:
Sold	$	2,194		$	10,123	$	41	$	161,900		$		726	$	1,031	$	5,766	$	9,879		$	9,048
Reinvested		–			3,967		–		25,826				16		51		170		166			466
Redeemed		(218	)		(14,917	)	–		(69,018	)			(206	)	(686	)	(1,724	)	(608		)	(3,939	)
Net Increase (Decrease)	$	1,976		$	(827	) $	41	$	118,708		$		536	$	396	$	4,212	$	9,437		$	5,575
Shares:
Sold		108			540		2		8,145				38		54		302		523			478
Reinvested		–			222		–		1,370				1		3		10			9		26
Redeemed		(11	)		(798	)	–		(3,522	)			(11	)	(38	)	(92	)	(32		)	(209	)
Net Increase (Decrease)		97			(36	)	2		5,993				28		19		220		500			295
Year Ended October 31, 2013
Dollars:
Sold		N/A		$	6,810		N/A	$	563,716		$		93	$	330	$	2,233	$	2,460		$	11,167
Reinvested		N/A			945		N/A		30				2		7		29		21			186
Redeemed		N/A			(11,563	)	N/A		(21,990	)			(65	)	(315	)	(964	)	(292		)	(10,725	)
Net Increase (Decrease)		N/A		$	(3,808	)	N/A	$	541,756		$		30	$	22	$	1,298	$	2,189		$	628
Shares:
Sold		N/A			432		N/A		35,063				6		22		144		161			774
Reinvested		N/A			68		N/A		2				–		1		2			2		13
Redeemed		N/A			(751	)	N/A		(1,290	)			(4	)	(21	)	(66	)	(19		)	(655	)
Net Increase (Decrease)		N/A			(251	)	N/A		33,775				2		2		80		144			132

Distributions:
Year Ended October 31, 2014 ^(a)
From net investment income		$–		$	(879	) $	–	$	(7,581			) $	(2	) $	(9	) $	(35	)$	(40		) $	(109	)
From net realized gain on
investments		–			(3,089	)	–		(18,262	)			(14	)	(42	)	(135	)	(126		)	(357	)
Total Dividends and Distributions		$–		$	(3,968	) $	–	$	(25,843)			$	(16	)$	(51	) $	(170	) $	(166		) $	(466	)
Year Ended October 31, 2013
From net investment income		N/A		$	(945	)	N/A	$	(36)			$	(2	) $	(7	) $	(29	)$	(21		) $	(186	)
From net realized gain on
investments		N/A			–		N/A		–				–		–		–			–		–
Total Dividends and Distributions		N/A		$	(945	)	N/A	$	(36)			$	(2	) $	(7	) $	(29	)$	(21		) $	(186	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																					Money Market Fund
																					Year Ended			Year Ended
																					October 31, 2014			October 31, 2013
Operations
Net investment income (loss)																				$	2			$	–
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																					219				149
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																					–				–
							Net Increase (Decrease) in Net Assets Resulting from Operations														221				149


Capital Share Transactions
Net increase (decrease) in capital share transactions																					(57,081	)			12,653
															Total Increase (Decrease) in Net Assets						(56,860	)			12,802

Net Assets
Beginning of period																					1,136,583			1,123,781
End of period (including undistributed net investment income as set forth below)																				$	1,079,723		$	1,136,583
Undistributed (overdistributed) net investment income (loss)																				$	–			$	(2	)

			Class A				Class B				Class C			Class J			Institutional
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	474,113			$		500		$		15,971		$	117,768			$242,449
Redeemed			(475,605			)	(3,544	)			(19,230	)		(146,440		)	(263,063		)
Net Increase (Decrease)		$	(1,492			) $	(3,044)			$	(3,259)			$ (28,672)				$ (20,614)
Shares:
Sold			474,115				499				15,971			117,768			242,450
Redeemed			(475,606			)	(3,544	)			(19,230	)		(146,440		)	(263,063		)
Net Increase (Decrease)			(1,491	)			(3,045	)			(3,259	)		(28,672		)	(20,613		)
Year Ended October 31, 2013
Dollars:
Sold		$598,551			$		2,350		$		26,882		$	180,552			$578,995
Redeemed			(584,145			)	(8,230	)			(22,972	)		(184,630		)	(574,700		)
Net Increase (Decrease)		$	14,406		$		(5,880			) $	3,910			$(4,078)				$4,295
Shares:
Sold			598,551				2,350				26,881			180,552			578,995
Redeemed			(584,145			)	(8,230	)			(22,972	)		(184,630		)	(574,700		)
Net Increase (Decrease)			14,406				(5,880	)			3,909				(4,078	)		4,295

Distributions:
Year Ended October 31, 2014
From net investment income			$–		$		–		$		–			$	–		$	–
From net realized gain on
investments			–				–				–				–			–
Total Dividends and Distributions			$–		$		–		$		–			$	–		$	–
Year Ended October 31, 2013
From net investment income			$–		$		–		$		–			$	–		$	–
From net realized gain on
investments			–				–				–				–			–
Total Dividends and Distributions			$–		$		–		$		–			$	–		$	–


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																							Principal Capital Appreciation Fund
																							Year Ended								Year Ended
																							October 31, 2014								October 31, 2013
Operations
Net investment income (loss)																							$				26,222				$		28,199
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																									109,057								58,459
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																									205,161								414,442
					Net Increase (Decrease) in Net Assets Resulting from Operations																				340,440								501,100

Dividends and Distributions to Shareholders
From net investment income																											(22,458	)					(26,749	)
From net realized gain on investments																											(48,623	)					(20,351	)
														Total Dividends and Distributions													(71,081	)					(47,100	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																											(26,562	)					32,293
											Total Increase (Decrease) in Net Assets														242,797								486,293

Net Assets
Beginning of period																									2,249,428								1,763,135
End of period (including undistributed net investment income as set forth below)																							$		2,492,225						$		2,249,428
Undistributed (overdistributed) net investment income (loss)																							$				21,687				$		17,823
			Class A		Class B		Class C				Class P			Institutional			R-1				R-2		R-3				R-4				R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold		$	66,454	$	157	$	9,269		$		12,447		$	54,748		$	713		$		518	$	4,734		$		1,945		$		9,360
Reinvested			21,096		777		1,009				626			44,739			37				60		572				479				961
Redeemed			(98,668	)	(15,081	)	(7,134	)			(6,207	)		(113,200	)		(725	)			(901	)	(3,013	)			(5,411	)			(6,923	)
Net Increase (Decrease)	$	(11,118)			$ (14,147)	$	3,144		$		6,866		$	(13,713	)	$	25		$		(323	) $	2,293		$		(2,987)			$	3,398
Shares:
Sold			1,208		3		203				219			986			13				9		84				35				172
Reinvested			399		18		23				12			834			1				1		11				9				18
Redeemed			(1,789	)	(327	)	(157	)			(110	)		(2,028	)		(13	)			(16	)	(55	)			(100	)			(124	)
Net Increase (Decrease)			(182	)	(306	)	69				121			(208	)		1				(6	)	40				(56	)			66
Year Ended October 31, 2013
Dollars:
Sold		$	63,018	$	275	$	9,262		$		6,233		$	190,747		$	479		$		766	$	9,118		$		5,544		$		10,798
Reinvested			13,903		610		499				344			30,059			37				43		347				256				481
Redeemed			(86,635	)	(15,747	)	(5,887	)			(3,772	)		(187,204	)		(1,279	)			(877	)	(3,283	)			(2,060	)			(3,782	)
Net Increase (Decrease)		$	(9,714)		$ (14,862)	$	3,874		$		2,805		$	33,602		$	(763)			$	(68	) $	6,182		$		3,740		$		7,497
Shares:
Sold			1,349		7		233				132			3,863			11				17		204				117				228
Reinvested			329		17		14				8			704			1				1		8				6				11
Redeemed			(1,878	)	(405	)	(152	)			(82	)		(3,992	)		(28	)			(19	)	(71	)			(43	)			(82	)
Net Increase (Decrease)			(200	)	(381	)	95				58			575			(16	)			(1	)	141				80				157

Distributions:
Year Ended October 31, 2014
From net investment income			$(5,774)	$	– $		(133)			$	(227)			$ (15,740)		$	(3)			$	(10)	$	(137)			$	(134)			$	(300	)
From net realized gain on
investments			(15,865	)	(795	)	(933	)			(477	)		(29,028	)		(34	)			(50	)	(435	)			(345	)			(661	)
Total Dividends and Distributions			$ (21,639)	$	(795	) $	(1,066)			$	(704)			$ (44,768)		$	(37)			$	(60	) $	(572)			$	(479)			$	(961	)
Year Ended October 31, 2013
From net investment income			$(7,478)	$	(107	) $	(193)			$	(221)			$ (18,112)		$	(16)			$	(20)	$	(188)			$	(142)			$	(272	)
From net realized gain on
investments			(6,837	)	(520	)	(339	)			(163	)		(11,966	)		(21	)			(23	)	(159	)			(114	)			(209	)
Total Dividends and Distributions			$ (14,315)		$(627	) $	(532)			$	(384)			$ (30,078)		$	(37)			$	(43)	$	(347)			$	(256)			$	(481	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																												Real Estate Securities Fund
																												Year Ended							Year Ended
																												October 31, 2014							October 31, 2013
Operations
Net investment income (loss)																												$			18,678				$				26,048
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																															23,520						216,748
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																													289,137										(69,792	)
							Net Increase (Decrease) in Net Assets Resulting from Operations																						331,335								173,004

Dividends and Distributions to Shareholders
From net investment income																															(27,287	)							(19,817	)
From net realized gain on investments																													(184,920			)							–
																		Total Dividends and Distributions											(212,207			)							(19,817	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																													516,277								(222,462			)
														Total Increase (Decrease) in Net Assets															635,405										(69,275	)

Net Assets
Beginning of period																													1,399,308								1,468,583
End of period (including undistributed net investment income as set forth below)																												$	2,034,713						$		1,399,308
Undistributed (overdistributed) net investment income (loss)																												$			4,917				$				10,964

			Class A				Class B		Class C					Class J				Class P			Institutional			R-1				R-2			R-3				R-4				R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold		$	67,599		$		183	$	7,683			$		37,358		$		32,115		$	461,087		$	2,285		$		5,590	$		16,783		$		21,281		$		64,004
Reinvested			22,872				509		3,549					21,633				3,342			109,388			847				2,015			7,091				7,474				16,873
Redeemed			(52,409	)			(1,159	)	(7,102	)				(29,346	)			(27,675	)		(204,964	)		(3,056	)			(5,317		)	(18,389	)			(13,090			)	(32,777	)
Net Increase (Decrease)		$	38,062		$		(467	) $	4,130			$		29,645		$		7,782		$	365,511		$	76		$		2,288	$		5,485		$		15,665		$		48,100
Shares:
Sold			3,401				9		388					1,892				1,602			22,981			116				291			853				1,092				3,445
Reinvested			1,265				29		200					1,227				184			6,028			47				116			401				426				957
Redeemed			(2,625	)			(60	)	(365	)				(1,500	)			(1,399	)		(10,310	)		(153	)			(274		)	(937	)			(679			)	(1,682	)
Net Increase (Decrease)			2,041				(22	)	223					1,619				387			18,699			10				133			317				839				2,720
Year Ended October 31, 2013
Dollars:
Sold		$	45,502		$		223	$	10,158			$		20,058		$		27,011		$	390,566		$	1,682		$		3,860	$		14,013		$		17,997		$		21,751
Reinvested			1,537				2		66					1,573				283			12,413			48				114			492				540				1,407
Redeemed			(61,172	)			(2,691	)	(6,013	)				(35,554	)			(19,123	)		(589,167	)		(3,448	)			(6,505		)	(20,093	)			(14,956)				(35,036	)
Net Increase (Decrease)	$	(14,133)				$	(2,466	) $	4,211		$	(13,923)					$	8,171		$	(186,188	)	$	(1,718)			$	(2,531		) $	(5,588)			$	3,581	$	(11,878			)
Shares:
Sold			2,146				10		480					962				1,289			18,517			80				188			666				865				1,038
Reinvested			73				–		3					77				13			594			2				6			24				27				69
Redeemed			(2,943	)			(129	)	(288	)				(1,731	)			(892	)		(27,725	)		(165	)			(319		)	(983	)			(731			)	(1,716	)
Net Increase (Decrease)			(724	)			(119	)	195					(692	)			410			(8,614	)		(83	)			(125		)	(293	)			161				(609	)

Distributions:
Year Ended October 31, 2014
From net investment income $			(2,511			) $	(20	) $	(199				) $	(2,370			) $	(597) $			(17,416)		$	(66			) $	(197		) $	(708			) $	(875			) $	(2,328	)
From net realized gain on
investments			(20,923)				(504	)	(3,732)					(19,272)				(4,454	)		(105,748	)		(781)				(1,979		)	(6,383)				(6,599			)	(14,545	)
Total Dividends and Distributions $			(23,434)			$	(524	) $	(3,931) $					(21,642)			$	(5,051) $			(123,164)		$	(847			) $	(2,176		) $	(7,091			) $	(7,474) $				(16,873)
Year Ended October 31, 2013
From net investment income $			(1,566			) $	(2	) $	(72				) $	(1,575			) $	(440) $			(13,555)		$	(48			) $	(119		) $	(493			) $	(540			) $	(1,407	)
From net realized gain on
investments			–				–		–					–				–			–			–				–			–				–				–
Total Dividends and Distributions $			(1,566			) $	(2	) $	(72				) $	(1,575			) $	(440) $			(13,555)		$	(48			) $	(119		) $	(493			) $	(540			) $	(1,407	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																											Short-Term Income Fund
																											Year Ended								Year Ended
																											October 31, 2014								October 31, 2013
Operations
Net investment income (loss)																											$				33,087				$		25,287
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																															7,291						9,035
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																															(12,438	)					(12,401	)
					Net Increase (Decrease) in Net Assets Resulting from Operations																										27,940						21,921

Dividends and Distributions to Shareholders
From net investment income																															(32,788	)					(23,658	)
From net realized gain on investments																															(979	)					–
																	Total Dividends and Distributions														(33,767	)					(23,658	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																													761,881								258,029
														Total Increase (Decrease) in Net Assets															756,054								256,292

Net Assets
Beginning of period																													1,782,122								1,525,830
End of period (including undistributed net investment income as set forth below)																											$		2,538,176						$		1,782,122
Undistributed (overdistributed) net investment income (loss)																											$				3,154				$		2,859

			Class A		Class C				Class J					Class P			Institutional				R-1		R-2				R-3				R-4				R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold		$	93,607	$	22,145		$		35,492		$	124,787				$	1,018,630			$	554	$	594		$		12,454		$		12,996		$		6,537
Reinvested			4,323		529				1,654					629			24,796				14		18				139				97				92
Redeemed			(156,237	)	(37,638	)			(41,219	)				(109,699	)		(238,125	)			(946	)	(288	)			(8,827	)			(3,171	)			(2,056	)
Net Increase (Decrease)		$	(58,307)		$ (14,964)		$		(4,073)				$	15,717		$	805,301		$		(378	) $	324		$		3,766		$		9,922		$		4,573
Shares:
Sold			7,642		1,807				2,898					10,193			83,261				45		49				1,016				1,061				534
Reinvested			353		43				135					51			2,023				1		1				11				8				7
Redeemed			(12,754	)	(3,071	)			(3,367	)				(8,957	)		(19,448	)			(77	)	(24	)			(720	)			(259	)			(168	)
Net Increase (Decrease)			(4,759	)	(1,221	)			(334	)				1,287			65,836				(31	)	26				307				810				373
Year Ended October 31, 2013
Dollars:
Sold	$	232,786		$	47,597		$		65,046			$		97,641		$	389,920		$		673	$	1,238		$		10,743		$		3,385		$		16,078
Reinvested			4,583		413				1,414					421			15,800				15		14				91				45				86
Redeemed			(259,894	)	(41,878	)			(48,961	)				(82,531	)		(167,397	)			(1,083	)	(802	)			(10,420	)			(2,157	)			(14,837	)
Net Increase (Decrease)	$	(22,525		) $	6,132		$		17,499			$		15,531		$	238,323		$		(395	) $	450		$		414		$		1,273		$		1,327
Shares:
Sold			18,983		3,880				5,304					7,964			31,819				55		101				876				276				1,316
Reinvested			373		33				115					35			1,288				1		1				7				4				7
Redeemed			(21,218	)	(3,413	)			(3,997	)				(6,729	)		(13,659	)			(88	)	(65	)			(849	)			(176	)			(1,212	)
Net Increase (Decrease)			(1,862	)	500				1,422					1,270			19,448				(32	)	37				34				104				111

Distributions:
Year Ended October 31, 2014
From net investment income			$(4,570	) $	(554)			$	(1,607)				$	(970)			$ (24,743)		$		(13	) $	(17)			$	(130)			$	(95)			$	(89	)
From net realized gain on
investments			(179	)	(56	)			(66	)				(28	)		(634	)			(1	)	(1	)			(9	)			(2	)			(3	)
Total Dividends and Distributions			$(4,749	) $	(610)			$	(1,673)				$	(998)			$ (25,377)		$		(14	) $	(18)			$	(139)			$	(97)			$	(92	)
Year Ended October 31, 2013
From net investment income			$(4,873	) $	(471)			$	(1,434)				$	(724)			$ (15,899)		$		(15	) $	(14)			$	(91)			$	(45)			$	(92	)
From net realized gain on
investments			–		–				–					–			–				–		–				–				–				–
Total Dividends and Distributions			$(4,873	) $	(471)				(1,434)				$	(724)			$ (15,899)		$		(15	) $	(14)			$	(91)			$	(45)			$	(92	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																					SmallCap Blend Fund
																					Year Ended				Year Ended
																					October 31, 2014				October 31, 2013
Operations
Net investment income (loss)																					$		(609	)	$				1,171
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																							64,485						56,606
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																							(24,171	)					83,602
				Net Increase (Decrease) in Net Assets Resulting from Operations																			39,705				141,379

Dividends and Distributions to Shareholders
From net investment income																							(158	)					(1,547	)
From net realized gain on investments																							(35,644	)					(2,003	)
												Total Dividends and Distributions											(35,802	)					(3,550	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																							18,085						(9,224	)
										Total Increase (Decrease) in Net Assets													21,988				128,605

Net Assets
Beginning of period																					487,094						358,489
End of period (including undistributed net investment income as set forth below)																				$	509,082				$		487,094
Undistributed (overdistributed) net investment income (loss)																					$		9		$				98
		Class A		Class B		Class C				Class J		Class P		Institutional				R-1			R-2		R-3		R-4				R-5
Capital Share Transactions:
Year Ended October 31, 2014 ^(a)
Dollars:
Sold	$	31,748	$	70	$	5,440		$		16,496	$	75	$	6,647		$		626	$		757	$	2,883	$	1,663		$		2,494
Reinvested		12,875		260		937				14,946		–		4,677				180			218		438		303				809
Redeemed		(34,544	)	(1,149	)	(2,870	)			(32,788	)	–		(4,755	)			(1,116	)		(1,041	)	(2,894	)	(2,157	)			(3,143	)
Net Increase (Decrease)	$	10,079	$	(819	)$	3,507		$		(1,346	) $	75	$	6,569		$		(310	) $		(66	)$	427	$	(191)			$	160
Shares:
Sold		1,465		4		263				787		3		292				29			35		133		74				110
Reinvested		608		13		47				732		–		211				9			11		21		14				37
Redeemed		(1,594	)	(58	)	(141	)			(1,566	)	–		(206	)			(53	)		(49	)	(133	)	(96	)			(138	)
Net Increase (Decrease)		479		(41	)	169				(47	)	3		297				(15	)		(3	)	21		(8	)			9
Year Ended October 31, 2013
Dollars:
Sold	$	22,398	$	229	$	3,615		$		18,811		N/A	$	1,364		$		537	$		646	$	1,178	$	1,825		$		3,210
Reinvested		1,124		26		45				1,489		N/A		639				14			14		47		32				107
Redeemed		(25,623	)	(2,349	)	(2,248	)			(25,665	)	N/A		(898	)			(898	)		(1,359	)	(1,780	)	(1,809	)			(3,945	)
Net Increase (Decrease)	$	(2,101	) $	(2,094	) $	1,412		$		(5,365	)	N/A	$	1,105		$		(347	) $		(699	) $	(555	) $	48		$		(628	)
Shares:
Sold		1,189		13		199				1,042		N/A		71				31			36		64		95				171
Reinvested		70		2		3				97		N/A		39				1			1		3		2				7
Redeemed		(1,411	)	(141	)	(128	)			(1,477	)	N/A		(46	)			(50	)		(82	)	(99	)	(93	)			(213	)
Net Increase (Decrease)		(152	)	(126	)	74				(338	)	N/A		64				(18	)		(45	)	(32	)	4				(35	)

Distributions:
Year Ended October 31, 2014 ^(a)
From net investment income		$–		$–	$	–		$		– $		–	$	(154)			$	– $			– $		– $		–		$		(4	)
From net realized gain on
investments		(12,988	)	(263	)	(973	)			(14,951	)	–		(4,523	)			(180	)		(220	)	(438	)	(303	)			(805	)
Total Dividends and Distributions		$(12,988	)	$(263	)$	(973)			$	(14,951	) $	–	$	(4,677)			$	(180	) $		(220	) $	(438	) $	(303)			$	(809	)
Year Ended October 31, 2013
From net investment income		$(414	)	$(1	) $	(2)			$	(642	)	N/A	$	(392)			$	(2	) $		(1	) $	(20	)$	(15)			$	(58	)
From net realized gain on
investments		(719	)	(26	)	(45	)			(848	)	N/A		(247	)			(12	)		(13	)	(27	)	(17	)			(49	)
Total Dividends and Distributions		$(1,133	) $	(27	)$	(47)			$	(1,490	)	N/A	$	(639)			$	(14	)$		(14	)$	(47	)$	(32)			$	(107	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.




Amounts in thousands																							SmallCap Value Fund II
																							Year Ended				Year Ended
																							October 31, 2014				October 31, 2013
Operations
Net investment income (loss)																							$		3,590		$	11,501
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements																							136,660					155,004
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies																									2,506			232,102
					Net Increase (Decrease) in Net Assets Resulting from Operations																		142,756					398,607

Dividends and Distributions to Shareholders
From net investment income																									(7,271	)		(14,153	)
From net realized gain on investments																									(98,502	)		–
																Total Dividends and Distributions							(105,773			)		(14,153	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																									(21,399	)		59,682
												Total Increase (Decrease) in Net Assets													15,584			444,136

Net Assets
Beginning of period																							1,547,212					1,103,076
End of period (including undistributed net investment income as set forth below)																						$	1,562,796				$	1,547,212
Undistributed (overdistributed) net investment income (loss)																							$		1,046		$	4,167
		Class A			Class J				Class P		Institutional					R-1		R-2		R-3			R-4		R-5
Capital Share Transactions:
Year Ended October 31, 2014 ^(a)
Dollars:
Sold	$	249		$	3,462		$		15		$	82,991		$		376	$	895	$	3,013	$		3,705	$	8,020
Reinvested		–			1,219				–			100,947				141		390		813			767		1,496
Redeemed		(32	)		(3,805	)			–		(205,532)					(773	)	(2,927	)	(4,334	)		(2,967	)	(9,528	)
Net Increase (Decrease)	$	217		$	876		$		15		$	(21,594)			$	(256	) $	(1,642	) $	(508	) $		1,505	$	(12	)
Shares:
Sold		18			256				1			6,025				29		69		222			275		592
Reinvested		–			93				–			7,515				11		30		62			58		113
Redeemed		(2	)		(281	)			–			(14,942	)			(60	)	(223	)	(323	)		(218	)	(707	)
Net Increase (Decrease)		16			68				1			(1,402	)			(20	)	(124	)	(39	)		115		(2	)
Year Ended October 31, 2013
Dollars:
Sold		N/A		$	5,315				N/A		$	225,126		$		458	$	2,123	$	2,463	$		2,043	$	8,833
Reinvested		N/A			77				N/A			13,687				9		32		51			85		212
Redeemed		N/A			(2,978	)			N/A		(174,421)					(902	)	(3,419	)	(2,231	)		(3,143	)	(13,738	)
Net Increase (Decrease)		N/A		$	2,414				N/A		$	64,392		$		(435	) $	(1,264	) $	283	$		(1,015	) $	(4,693	)
Shares:
Sold		N/A			453				N/A			17,844				41		182		213			177		768
Reinvested		N/A			8				N/A			1,302				1		3		5			8		20
Redeemed		N/A			(256	)			N/A			(14,837	)			(77	)	(302	)	(205	)		(267	)	(1,158	)
Net Increase (Decrease)		N/A			205				N/A			4,309				(35	)	(117	)	13			(82	)	(370	)

Distributions:
Year Ended October 31, 2014 ^(a)
From net investment income		$–		$	–		$		–		$	(7,197)			$	– $		– $		(4	) $		(17	)$	(53	)
From net realized gain on
investments		–			(1,219	)			–			(93,750	)			(141	)	(390	)	(809	)		(750	)	(1,443	)
Total Dividends and Distributions		$–		$	(1,219)			$	–	$	(100,947)				$	(141	) $	(390	) $	(813	) $		(767	)$	(1,496	)
Year Ended October 31, 2013
From net investment income		N/A		$	(77	)			N/A		$	(13,687)			$	(9	) $	(32	) $	(51	)$		(85	)$	(212	)
From net realized gain on
investments		N/A			–				N/A			–				–		–		–			–		–
Total Dividends and Distributions		N/A		$	(77	)			N/A		$	(13,687)			$	(9	) $	(32	) $	(51	)$		(85	)$	(212	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands										Tax-Exempt Bond Fund
										Year Ended			Year Ended
										October 31, 2014		October 31, 2013
Operations
Net investment income (loss)									$	9,195		$	10,410
Net realized gain (loss) on investments, foreign currency transactions, futures,
options and swaptions, short sales, and swap agreements										(1,982	)		(2,035	)
Change in unrealized appreciation/depreciation of investments, futures, options and swaptions, short sales,
swap agreements, and translation of assets and liabilities in foreign currencies										14,045			(18,889	)
					Net Increase (Decrease) in Net Assets Resulting from Operations					21,258			(10,514	)

Dividends and Distributions to Shareholders
From net investment income										(8,811	)		(10,379	)
							Total Dividends and Distributions			(8,811	)		(10,379	)

Capital Share Transactions
Net increase (decrease) in capital share transactions										(10,599	)		(28,337	)
							Total Increase (Decrease) in Net Assets			1,848			(49,230	)

Net Assets
Beginning of period										215,995			265,225
End of period (including undistributed net investment income as set forth below)									$	217,843		$	215,995
Undistributed (overdistributed) net investment income (loss)									$	1,030		$	609

			Class A		Class B		Class C
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold		$	15,214	$	1	$	2,856
Reinvested			7,042		25		250
Redeemed			(33,331	)	(362	)	(2,294	)
Net Increase (Decrease)	$	(11,075		) $	(336	) $	812
Shares:
Sold			2,106		–		397
Reinvested			974		3		34
Redeemed			(4,663	)	(51	)	(319	)
Net Increase (Decrease)			(1,583	)	(48	)	112
Year Ended October 31, 2013
Dollars:
Sold		$	34,889	$	52	$	3,070
Reinvested			8,204		46		288
Redeemed			(68,764	)	(1,039	)	(5,083	)
Net Increase (Decrease)	$	(25,671		) $	(941	) $	(1,725	)
Shares:
Sold			4,603		7		412
Reinvested			1,120		6		39
Redeemed			(9,456	)	(141	)	(697	)
Net Increase (Decrease)			(3,733	)	(128	)	(246	)

Distributions:
Year Ended October 31, 2014
From net investment income			$(8,476	) $	(26	) $	(309	)
From net realized gain on
investments			–		–		–
Total Dividends and Distributions			$(8,476	) $	(26	) $	(309	)
Year Ended October 31, 2013
From net investment income			$(9,987	) $	(50	) $	(342	)
From net realized gain on
investments			–		–		–
Total Dividends and Distributions			$(9,987	) $	(50	) $	(342	)

Principal Funds, Inc. (the "Fund") is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company and operates as a series fund in the mutual fund industry. The financial statements for Bond & Mortgage Securities Fund, California Municipal Fund, Diversified International Fund, Equity Income Fund, Global Diversified Income Fund, Global Real Estate Securities Fund, Government & High Quality Bond Fund, High Yield Fund, High Yield Fund I, Income Fund, Inflation Protection Fund, International Emerging Markets Fund, International Fund I, LargeCap Growth Fund, LargeCap Growth Fund I, LargeCap S&P 500 Index Fund, LargeCap Value Fund, MidCap Fund, MidCap Value Fund III, Money Market Fund, Principal Capital Appreciation Fund, Real Estate Securities Fund, Short-Term Income Fund, SmallCap Blend Fund, SmallCap Value Fund II and Tax-Exempt Bond Fund (known as the "Funds") are presented herein. The Funds may offer up to ten classes of shares: Class A, Class C, Class J, Class P, Institutional, R-1, R-2, R-3, R-4 and R-5. Class B shares of the Funds are no longer available for purchase. Information presented in these financial statements pertains to the Class A, Class B, Class C, and Class P shares. Certain detailed financial information for the Class J, Institutional, R-1, R-2, R-3, R-4, and R-5 classes of shares is provided separately.

Each of the Funds is an investment company and applies specialized accounting and reporting under Accounting Standards Codification Topic 946, Financial Services - Investment Companies. Each of the Funds was an investment company at all times during the period. The Funds have not provided financial support, and are not contractually required to provide financial support to any investee.

Effective March 1, 2013, the initial purchase of $10,000 of Class A shares of High Yield Fund I was made by Principal Management Corporation (the "Manager").

Effective March 1, 2013, the initial purchase of $10,000 of Class A shares of LargeCap Growth Fund I was made by the Manager.

Effective June 3, 2014, the initial purchases of $10,000 of Class A and Class P shares of International Fund I, MidCap Value Fund III, and SmallCap Value Fund II were made by the Manager.

Effective June 3, 2014, the initial purchases of $10,000 of Class P shares of LargeCap Growth Fund I, LargeCap Value Fund, and SmallCap Blend Fund were made by the Manager.

All classes of shares for each of the Funds represent interests in the same portfolio of investments, and will vote together as a single class except where otherwise required by law or as determined by the Fund’s Board of Directors. In addition, the Board of Directors declares separate dividends on each class of shares.

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The following summarizes the significant accounting policies of the Funds:

Security Valuation. The Funds (with the exception of Money Market Fund) value securities for which market quotations are readily available at market value, which is determined using the last reported sale price. If no sales are reported, as is regularly the case for some securities traded over-the-counter, securities are valued using the last reported bid price or an evaluated bid price provided by a pricing service. Pricing services use modeling techniques that incorporate security characteristics, market conditions and dealer-supplied valuations to determine an evaluated bid price. When reliable market quotations are not considered to be readily available, which may be the case, for example, with respect to restricted securities, certain debt securities, preferred stocks, and foreign securities, the investments are valued at their fair value as determined in good faith by the Manager under procedures established and periodically reviewed by the Fund’s Board of Directors.

The value of foreign securities used in computing the net asset value per share is generally determined as of the close of the foreign exchange where the security is principally traded. Events that occur after the close of the applicable foreign market or exchange but prior to the calculation of the Funds’ net asset values are reflected in the Funds’ net asset values and these securities are valued at fair value as determined in good faith by the Manager under procedures established and periodically reviewed by the Fund’s Board of Directors. Many factors are reviewed in the course of making a good faith determination of a security’s fair value, including, but not limited to, price movements in ADRs, futures contracts, industry indices, general indices, and foreign currencies.

To the extent the Funds invest in foreign securities listed on foreign exchanges which trade on days on which the Funds do not determine net asset values, for example weekends and other customary national U.S. holidays, the Funds’ net asset values could be significantly affected on days when shareholders cannot purchase or redeem shares.

Certain securities issued by companies in emerging market countries may have more than one quoted valuation at any given point in time, sometimes referred to as a “local” price and a “premium” price. The premium price is often a negotiated price, which may not consistently represent a price at which a specific transaction can be effected. It is the policy of the Funds to value such securities at prices at which it is expected those shares may be sold, and the Manager or any sub-advisor is authorized to make such determinations subject to such oversight by the Fund’s Board of Directors as may occasionally be necessary.

Money Market Fund values its securities, other than holdings of other publicly traded investment funds, at amortized cost as permitted under Rule 2a-7 of the Investment Company Act of 1940. Other publicly traded investment funds are valued at the funds’ net asset value. Under the amortized cost method, a security is valued by applying a constant yield to maturity of the difference between the principal amount due at maturity and the cost of the security to the Funds.

Currency Translation. Foreign holdings are translated to U.S. dollars using the exchange rate at the daily close of the New York Stock Exchange. The identified cost of the Funds’ holdings is translated at approximate rates prevailing when acquired. Income and expense amounts are translated at approximate rates prevailing when received or paid, with daily accruals of such amounts reported at approximate rates prevailing at the date of valuation. Since the carrying amount of the foreign securities is determined based on the exchange rate and market values at the close of the period, it is not practicable to isolate that portion of the results of operations arising as a result of changes in the foreign exchange rates from the fluctuations arising from changes in the market prices of securities during the period.

Net realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between trade and settlement dates on security transactions, and the difference between the amount of dividends and foreign withholding taxes recorded on the books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized appreciation (depreciation) on translation of assets and liabilities in foreign currencies arise from changes in the exchange rate relating to assets and liabilities, other than investments in securities, purchased and held in non-U.S. denominated currencies.

The following funds held securities denominated in foreign currencies that exceeded 5% of net assets of the fund:

Income and Investment Transactions. The Funds record investment transactions on a trade date basis. Trade date for senior floating rate interests purchased in the secondary market is the date on which the transaction is entered into. The identified cost basis has been used in determining the net realized gain or loss from investment transactions and unrealized appreciation or depreciation of investments. The Funds record dividend income on the ex-dividend date, except dividend income from foreign securities whereby the ex-dividend date has passed; such dividends are recorded as soon as the Funds are informed of the ex-dividend date. Interest income is recognized on an accrual basis. Discounts and premiums on securities are accreted/amortized over the lives of the respective securities. The Funds allocate daily all income and realized and unrealized gains or losses to each class of shares based upon the relative proportion of the value of shares outstanding (number of settled shares outstanding for Money Market Fund) of each class.

Expenses. Expenses directly attributed to a particular fund are charged to that fund. Other expenses not directly attributed to a particular fund are apportioned among the registered investment companies managed by the Manager.

Management fees are allocated daily to each class of shares based upon the relative proportion of the value of shares outstanding (number of settled shares outstanding for Money Market Fund) of each class. Expenses specifically attributable to a particular class are charged directly to such class and are included separately in the statements of operations.

Distributions to Shareholders. With respect to Money Market Fund, all net investment income and any realized gains from investment transactions are declared as dividends daily to settled shares of record as of that day. With respect to Bond & Mortgage Securities Fund, California Municipal Fund, Government & High Quality Bond Fund, High Yield Fund, High Yield Fund I, Income Fund, Short-Term Income Fund and Tax-Exempt Bond Fund, net investment income is declared as dividends daily to settled shares of record as of that day, and all distributions of realized gains from investment transactions are recorded on the ex-dividend date. Dividends and distributions to shareholders of the other Funds are recorded on the ex-dividend date. Dividends and distributions to shareholders from net investment income and net realized gain from investments and foreign currency transactions are determined in accordance with federal tax regulations, which may differ from U.S. generally accepted accounting principles. These differences are primarily due to differing treatments for net operating losses, foreign currency transactions, futures contracts, certain defaulted securities, sales of Passive Foreign Investment Companies, losses deferred due to wash sales, tax straddles, mortgage-backed securities, certain preferred securities, swap agreements, and limitations imposed by Sections 381-384 of the Internal Revenue Code. Permanent book and tax basis differences are reclassified within the capital accounts based on federal tax-basis treatment; temporary differences do not require reclassification. To the extent dividends and distributions exceed current and accumulated earnings and profits for federal income tax purposes, they are reported as return of capital distributions.

Global Real Estate Securities Fund and Real Estate Securities Fund receive substantial distributions from holdings in Real Estate Investment Trusts (“REITs”). Distributions from REITs may be characterized as ordinary income, net capital gain, or a return of capital to the Funds. The proper characterization of REIT distributions is generally not known until after the end of each calendar year. As such, estimates must be used in reporting the character of income and distributions for financial statement purposes.

Federal Income Taxes. No provision for federal income taxes is considered necessary because each of the Funds intends to qualify as a “regulated investment company” under the Internal Revenue Code and intends to distribute each year substantially all of its net investment income and realized capital gains to shareholders.

The Funds evaluate tax positions taken or expected to be taken in the course of preparing the Funds’ tax returns to determine whether it is “more likely than not” that each tax position would be sustained upon examination by a taxing authority based on the technical merits of the position. Tax positions not deemed to meet the more likely than not threshold would be recorded as a tax benefit or expense in the current year. During the year ended October 31, 2014, the Funds did not record any such tax benefit or expense in the accompanying financial statements. The statute of limitations remains open for the fiscal years from 2011-2014. No examinations are in progress at this time.

Foreign Taxes. Certain of the Funds are subject to foreign income taxes imposed by certain countries in which they invest. Foreign income taxes are accrued by the Funds as a reduction of income. These amounts are shown as withholding tax on foreign dividends on the statements of operations.

Gains realized upon the disposition of certain foreign securities held by the Funds may be subject to capital gains tax, payable prior to repatriation of sale proceeds. The tax is computed on certain net realized gains and, if any, is shown on the statement of operations. Realized losses in excess of gains may be carried forward to offset future gains. In addition, the Funds accrue an estimated deferred tax liability for future gains on certain foreign securities. Any accrued tax liability is shown on the statement of assets and liabilities. At October 31, 2014, Diversified International Fund had no foreign tax refund receivable and had a deferred tax liability of $1,195,000 and International Emerging Markets Fund had no foreign tax refund receivable and had a deferred tax liability of $49,000 relating to foreign securities.

Borrowings. Pursuant to an exemptive order issued by the Securities and Exchange Commission, the Funds and other registered investment companies managed by the Manager may participate in an interfund lending facility (“Facility”). The Facility allows the Funds to borrow money from or loan money to the other participants. Loans under the Facility are made to handle unusual and/or unanticipated short-term cash requirements. Interest paid and received on borrowings is the average of the current repurchase agreement rate and the bank loan rate (the higher of (i) the Federal Funds Rate or (ii) the One Month LIBOR rate plus 1.00%). During the year ended October 31, 2014, Global Diversified Income Fund, Government & High Quality Bond Fund, International Emerging Markets Fund, MidCap Fund, Real Estate Securities Fund, and Short-Term Income Fund each borrowed from the Facility. Bond & Mortgage Securities Fund, Diversified International Fund, Equity Income Fund, Global Diversified Income Fund, Global Real Estate Securities Fund, Government & High Quality Bond Fund, High Yield Fund, High Yield Fund I, Income Fund, International Emerging Markets Fund, LargeCap Growth Fund, LargeCap Growth Fund I, LargeCap S&P 500 Index Fund, LargeCap Value Fund, MidCap Fund, Principal Capital Appreciation Fund, Real Estate Securities Fund, Short-Term Income Fund, and SmallCap Blend Fund each loaned to the Facility. The interest expense associated with these borrowings is included in other expenses on the statements of operations. The interest received is included in interest on the statements of operations.

In addition, certain of the Funds participate with other registered investment companies managed by the Manager in an unsecured joint line of credit with a bank which allows the participants to borrow up to $75 million, collectively. Borrowings are made solely to facilitate the handling of unusual and/or unanticipated short-term cash requirements. Interest is charged to each participant, based on its borrowings, at a rate equal to the higher of the Federal Funds Rate or the One Month LIBOR rate plus 1.00%. Additionally, a commitment fee is charged at an annual rate of .08% on the amount of the line of credit. During the year ended October 31, 2014, Bond & Mortgage Securities Fund, Diversified International Fund, Global Diversified Income Fund, High Yield Fund, High Yield Fund I, Inflation Protection Fund, International Emerging Markets Fund, LargeCap Growth Fund I, Principal Capital Appreciation Fund, Short-Term Income Fund, and Tax-Exempt Bond Fund, borrowed against the line of credit. The interest expense associated with these borrowings is included in other expenses on the statements of operations.

Credit Linked Notes. Global Diversified Income Fund invests in structured notes whose market values are primarily derived from changes in the value of various credit indices and other factors. Valuations on these securities may be volatile as the payment features on certain notes may contain attributes that multiply the effects of changes in the values of the underlying indices. Structured notes may entail a greater degree of market risk than other types of debt securities. Structured notes may also be more volatile, less liquid, and more difficult to accurately price than less complex securities or more traditional debt securities. Fluctuations in value of the structured notes are recorded as unrealized gains and losses in the accompanying financial statements. Interest income is accrued daily. These notes are subject to prepayment, credit, and interest rate risks. At maturity, or when a note is sold, the Fund records a realized gain or loss.

Counterparties. The Funds may be exposed to counterparty risk, or the risk that another party with which the Funds have unsettled or open transactions will fail to perform on their commitment. To the extent that unpaid amounts owed to the Funds exceed a predetermined threshold agreed to with the counterparty, such counterparty shall advance collateral to the Funds in the form of cash or cash equivalents equal in value to the unpaid amount owed to the Funds. If the unpaid amount owed to the Funds subsequently decreases, the Funds would be required to return all or a portion of the collateral.

Master Agreements may also help limit counterparty risk by specifying collateral posting arrangements at pre-arranged exposure levels. Under the Master Agreements, collateral is routinely transferred if the total net exposure to certain transactions governed under the relevant master agreement with a counterparty exceeds a specified threshold.

Bond & Mortgage Securities Fund, Global Diversified Income Fund, and Inflation Protection Fund have financial instruments that are subject to Master Agreements or similar agreements.

As of October 31, 2014, financial assets and liabilities subject to Master Netting Agreements or similar agreements were as follows (amounts in thousands):

* Represents amount of offsetting derivative assets or liabilities that are subject to an enforceable master netting agreement or similar agreement that are not netted against the gross derivative assets or liabilities for presentation on the statements of assets and liabilities.

** Collateral pledged or received may be in excess of recognized assets or liabilities, see the schedule of investments.

Collateral information relating to securities on loan is included in the securities lending note to financial statements.

The financial instruments that are subject to Master Agreements or similar agreements may include right of setoff provisions. Derivative instruments include provisions to setoff positions covered under the agreements with the same counterparties and provisions to setoff positions outside of the agreements with the same counterparties in the event of default by one of the parties. Derivative instruments also include collateral provisions. Collateral received and pledged are generally settled daily with each counterparty.

Floating Rate Notes Issued in Conjunction with Securities Held. California Municipal Fund and Tax-Exempt Bond Fund have entered into transactions in which a fund transfers fixed rate bonds to trusts in exchange for cash and residual interests in the trusts’ assets and cash flows, which are in the form of inverse floating rate securities. The trusts finance the purchases of the fixed rate bonds by issuing floating rate notes to third parties. The fund enters into shortfall and forbearance agreements with the trusts, which commit the fund to pay the trusts, in certain circumstances, the difference between the liquidation value of the fixed rate bonds held by the trusts and the liquidation value of the floating rate notes held by third parties, as well as any shortfalls in interest cash flows. The residual interests held by the fund (inverse floating rate securities) include the right of the fund (1) to cause the holders of the floating rate notes to tender their notes at par at the next interest rate reset date, and (2) to transfer the fixed rate bond from the trusts to the fund, thereby collapsing the trusts. The fund accounts for the transfer of bonds to the trusts as secured borrowings, with the securities transferred remaining in the fund’s investment assets, and the related floating rate notes reflected as fund liabilities under the caption “floating rate notes issued” in the statement of assets and liabilities. The notes issued by the trusts have interest rates that reset weekly, and the floating rate note holders have the option to tender their notes to the trusts for redemption at par at each reset date.

Foreign Currency Contracts. Certain of the Funds may be subject to foreign currency exchange rate risk in the normal course of pursuing such Fund’s investment objective. The Funds may use foreign currency contracts to gain exposure to, or hedge against changes in the value of foreign currencies. Certain of the Funds enter into forward contracts to purchase or sell foreign currencies at a specified future date at a fixed exchange rate. Forward foreign currency contracts are valued at the forward rate, and are marked-to-market daily. The change in market value is recorded by the Funds as an unrealized gain or loss. When the contract is closed, the Funds record a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed.

The use of forward foreign currency contracts does not eliminate the fluctuations in underlying prices of the Funds’ portfolio securities, but it does establish a rate of exchange that can be achieved in the future. Although forward foreign currency contracts limit the risk of loss due to a decline in the value of the hedged currency, they also limit any potential gain that might result should the value of the currency increase. In addition, the Funds could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts or if the value of the currency changes unfavorably to the U.S. dollar.

Futures Contracts. The Funds are subject to equity price risk, interest rate risk, and foreign currency exchange rate risk in the normal course of pursuing their investment objectives. The Funds (with the exception of Money Market Fund) may enter into futures contracts to hedge against changes in or to gain exposure to, change in the value of equities, interest rates and foreign currencies. Initial margin deposits are made by cash deposits or segregation of specific securities as may be required by the exchange on which the transaction was conducted. Pursuant to the contracts, a fund agrees to receive from or pay to the broker, an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments are known as “variation margin” and are recorded by the fund as a variation margin receivable or payable on financial derivative instruments. During the period the futures contracts are open, daily changes in the fair value of the contracts are recognized as unrealized gains or losses. These unrealized gains or losses are included as a component of net unrealized appreciation (depreciation) of investments on the statements of assets and liabilities. When the contracts are closed, the fund recognizes a realized gain or loss equal to the difference between the proceeds from, or cost of, the closing transaction and the fund’s cost basis in the contract. There is minimal counterparty credit risk to the Funds because futures are exchange traded and the exchange’s clearinghouse, as counterparty to all exchange traded futures, guarantees the futures against default.

Illiquid Securities. Illiquid securities generally cannot be sold or disposed of in the ordinary course of business (within seven calendar days) at approximately the value at which each of the Funds has valued the investments. This may have an adverse effect on each of the Funds’ ability to dispose of particular illiquid securities at fair market value and may limit each of the Funds’ ability to obtain accurate market quotations for purposes of valuing the securities.

Indemnification. Under the Fund’s by-laws, present and past officers, directors and employees are indemnified against certain liabilities arising out of the performance of their duties. In addition, in the normal course of business, the Fund may enter into a variety of contracts that may contain representations and warranties which provide general indemnifications. The Fund’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Fund.

Inflation-Indexed Bonds. Certain of the Funds 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 statements of operations, even though the Funds would not receive the principal until maturity.

Joint Trading Account. Certain of the Funds may, pursuant to an exemptive order issued by the Securities and Exchange Commission, transfer uninvested funds into a joint trading account. The order permits the participating Funds’ cash balances to be deposited into a single joint account along with the cash of other registered investment companies managed by the Manager. These balances may be invested in one or more short-term instruments or repurchase agreements that are collateralized by U.S. government securities. Earnings from the joint trading account are allocated to each of the Funds based on their pro rata participating ownership interest in the joint trading account.

Mortgage Dollar Rolls. Certain of the Funds have entered into mortgage-dollar-roll transactions on “to-be-announced” securities (“TBA’s”), in which the Funds sell mortgage-backed securities and simultaneously agree to purchase similar securities in the future at a predetermined price. The proceeds of the securities sold in mortgage-dollar-roll transactions are invested in additional securities. The Funds forgo principal and interest paid on the securities, and are compensated by interest earned on the proceeds of the initial sale and by a lower price on the securities to be repurchased. The Funds treat mortgage-dollar-roll transactions as purchases and sales; as such, these transactions may increase the Funds’ portfolio turnover ratio. Amounts to be received or paid in connection with open mortgage-dollar-rolls are included in Investment securities sold and Investment securities purchased on the statements of assets and liabilities.

Options Contracts. During the period Global Diversified Income Fund and Inflation Protection Fund wrote call and put options on futures, swaps, securities, indices and currencies they own or in which they may invest and inflation floors for both hedging and non-hedging purposes. Writing put options tends to increase a fund’s exposure to the underlying instrument. Writing call options tends to decrease a fund’s exposure to the underlying instrument. When a fund writes a call or put option and inflation floor, an amount equal to the premium received is recorded as a liability and subsequently marked to market to reflect the current value of the option written. An inflation floor can give downside protection to investments in inflation-linked products. These liabilities are reflected as options contracts written on the statements of assets and liabilities. Premiums received from writing options which expire are treated as realized gains. Premiums received from writing options which are exercised or closed are added to the proceeds or offset against amounts paid on the underlying future, swap, security, index or currency transaction to determine the realized gain or loss. A fund, as a writer of an option, has no control over whether the underlying future, swap, security, index or currency may be sold (call) or purchased (put) and as a result bears the market risk of an unfavorable change in the price of the future, swap, security, index or currency underlying the written option. There is the risk a fund may not be able to enter into a closing transaction because of an illiquid market. A fund may also purchase put and call options. Purchasing call options tends to increase a fund’s exposure to the underlying instrument. Purchasing put options tends to decrease a fund’s exposure to the underlying instrument. A fund pays a premium which is included on the fund’s statements of assets and liabilities as an investment and subsequently marked to market to reflect the current value of the option. Premiums paid for purchasing options which expire are treated as realized losses. The risk associated with purchasing put and call options is limited to the premium paid. Premiums paid for purchasing options which are exercised or closed are added to the amounts paid or offset against the proceeds on the underlying future, swap, security, index or currency transaction to determine the realized gain or loss. Details of options contracts open at year end are included in the Funds' schedules of investments. Transactions in options written during the year ended October 31, 2014, were as follows:

Rebates. Subject to best execution, the Funds may direct certain portfolio transactions to brokerage firms that, in turn, have agreed to rebate a portion of the related brokerage commission to the Funds in cash. Commission rebates are included as a component of realized gain from investment transactions in the statements of operations.

Repurchase Agreements. The Funds may invest in repurchase agreements that are fully collateralized, typically by U.S. government or U.S. government agency securities. It is the Funds’ policy that its custodian takes possession of the underlying collateral securities. The fair value of the collateral is at all times at least equal to the total amount of the repurchase obligation. In the event of default on the obligation to repurchase, the Funds have the right to liquidate the collateral and apply the proceeds in satisfaction of the obligation. In the event the seller of a repurchase agreement defaults, the Funds could experience delays in the realization of the collateral.

Restricted Securities. Certain of the Funds may invest in securities that are subject to legal or contractual restrictions on resale. These securities generally may be resold in transactions exempt from registration or to the public if the securities are registered. Disposal of these securities may involve time-consuming negotiations and expense, and prompt sale at an acceptable price may be difficult.

Senior Floating Rate Interests. The Funds may invest in senior floating rate interests (bank loans). Senior floating rate interests hold the most senior position in the capital structure of a business entity (the “Borrower”), are typically secured by specific collateral and have a claim on the assets and/or stock of the Borrower that is senior to that held by subordinated debtholders and stockholders of the Borrower. Senior floating rate interests are typically structured and administered by a financial institution that acts as the agent of the lenders participating in the senior floating rate interest. Senior floating rate interests are typically rated below-investment-grade, which means they are more likely to default than investment-grade loans. A default could lead to non-payment of income which would result in a reduction of income to the fund and there can be no assurance that the liquidation of any collateral would satisfy the Borrower’s obligation in the event of non-payment of scheduled interest or principal payments, or that such collateral could be readily liquidated.

Senior floating rate interests pay interest at rates which are periodically reset by reference to a base lending rate plus a spread. These base lending rates are generally the prime rate offered by a designated U.S. bank or the London InterBank Offered Rate (LIBOR) or the prime rate offered by one or more major United States banks.

Senior floating rate interests generally are subject to mandatory and/or optional prepayment. Because of these mandatory prepayment conditions and because there may be significant economic incentives for the Borrower to repay, prepayments of senior floating rate interests may occur. As a result, the actual remaining maturity of senior floating rate interests may be substantially less than stated maturities shown in the schedules of investments.

In connection with the Senior floating rate interests, the Funds may also enter into unfunded loan commitments (“commitments”). All or a portion of the commitments may be unfunded. The Funds are obligated to fund these commitments at the borrower’s discretion. Therefore, the Funds must have funds sufficient to cover its contractual obligation. Unfunded loan commitments are marked to market daily and the unrealized gain or loss is shown as a separate line item called unfunded loan commitments on the statements of assets and liabilities. As of October 31, 2014, the unfunded loan commitments were as follows (amounts in thousands):

Short Sales. Global Diversified Income Fund entered into short sales transactions during the period. A short sale is a transaction in which a fund sells a security it does not own as a hedge against some of its long positions and/or in anticipation of a decline in the market price of the security. The fund must borrow the security sold short and deliver it to the broker dealer which made the short sale. A security sold in a short sale transaction and the interest or dividend payable on the security if any, is reflected as a liability on the statement of assets and liabilities. The fund is obligated to pay any interest or dividends received on the borrowed securities. Interest accrued and dividends declared on short positions are recorded as an expense and appear as dividends and interest on shorts on the statement of operations. A fund is obligated to deliver the security at the market price at the time the short position is closed. Possible losses from short sales may be unlimited.

The fund is required to pledge cash or securities to the broker as collateral for securities sold short. Collateral requirements are calculated daily based on the current market value of the short positions. Cash deposited with the broker for collateral is included in deposits with counterparty on the statement of assets and liabilities and securities segregated as collateral are footnoted in the schedule of investments. The fund may pay broker’s fees on the borrowed securities and may also pay a financing charge for the difference in the market value of the short position and cash collateral deposited with the broker. These fees are included as short sale fees on the statement of operations.

Swap Agreements. Bond & Mortgage Securities Fund, High Yield Fund, and Inflation Protection Fund invested in swap agreements during the period. Swap agreements are privately negotiated agreements between a fund and a counterparty to exchange a series of cash flows at specified intervals based upon, or calculated by reference to, changes in specified prices or rates for a specified amount of an underlying asset. A fund may enter into credit default, interest rate, or total return swap agreements to manage its exposure to credit, interest rate, or market risk. In connection with these agreements, securities may be identified as collateral in accordance with the terms of the respective swap agreements to provide assets of value and recourse in the event of default or bankruptcy/insolvency.

Swap agreements are valued through a pricing service or using procedures established and periodically reviewed by the Fund’s Board of Directors; changes in value are recorded as unrealized gain or loss. These unrealized gains or losses are included as a component of net unrealized appreciation (depreciation) of investments on the statements of assets and liabilities.

Upon termination of swap agreements, the Funds recognize a realized gain or loss. Net periodic payments to be received or paid are accrued daily and are recorded in the statements of operations as realized gains or losses.

Payments received or made at the beginning of the measurement period are reflected as such on the statements of assets and liabilities and represent payments made or received upon entering into the swap agreement to compensate for differences between the stated terms of the swap agreement and prevailing market conditions (credit spreads, interest rates, and other relevant factors). These upfront payments are amortized daily over the term of the swap agreement as realized gains or losses on the statements of operations.

Notional principal amounts are used to express the extent of involvement in these agreements. Risks may exceed amounts shown on the statements of assets and liabilities. These risks include changes in the returns of the underlying instruments, unfavorable interest rate fluctuation, that the counterparty to the agreements may default on its obligation to perform or disagree as to the meaning of contractual terms in the agreements, and the possible lack of liquidity with respect to the swap agreements.

The Funds and any counterparty are required to maintain an agreement that requires the Funds and that counterparty to monitor the net fair value of all derivative transactions entered into pursuant to the contract between the Funds and such counterparty. If the net fair value of such derivatives transactions between the Funds and that counterparty exceeds a certain threshold (as defined in the agreement), the Funds or the counterparty are required to post cash and/or securities as collateral. Fair values of derivatives transactions presented in the financial statements are not netted with the fair values of other derivatives transactions or with any collateral amounts posted by the Funds or any counterparty.

Credit default swaps involve commitments to pay a fixed rate at a predetermined frequency in exchange for a lump sum payment if a “credit event”, as defined in the agreement, affecting a third party occurs. Credit events may include a failure to pay interest, bankruptcy, restructuring, or other event as defined in the agreement. A “buyer” of credit protection agrees to pay a counterparty to assume the credit risk of an issuer upon the occurrence of a credit event. The “seller” of the protection receives periodic payments and agrees to assume the credit risk of an issuer upon the occurrence of a credit event. As the seller of credit protection, a Fund would add leverage to its portfolio because, in addition to its total net assets, a Fund would be subject to investment exposure on the notional amount of the swap.

If a fund is a seller of protection and a credit event occurs, as defined under the terms of that particular swap agreement, the fund will either (i) pay to the buyer of protection an amount equal to the notional amount of the swap and take delivery of the referenced obligation, other deliverable obligations or underlying securities comprising the referenced index or (ii) pay a net settlement amount in the form of cash or securities equal to the notional amount of the swap less the recovery value of the referenced obligation or underlying securities comprising the referenced index. If a Fund is a buyer of protection and a credit event occurs, as defined under the terms of that particular swap agreement, a Fund will either (i) receive from the seller of protection an amount equal to the notional amount of the swap and deliver the referenced obligation, other deliverable obligations or underlying securities comprising the referenced index or (ii) receive a net settlement amount in the form of cash or securities equal to the notional amount of the swap less the recovery value of the referenced obligation or underlying securities comprising the referenced index.

Credit default swap agreements on credit indices involve one party making a stream of payments to another party in exchange for the right to receive a specified return in the event of a write-down, principal shortfall, interest shortfall or default of all or part of the referenced entities comprising the credit index. A credit index is a basket of credit instruments or exposures designed to be representative of some part of the credit market as a whole. These indices are made up of reference credits that are judged by a poll of dealers to be the most liquid entities in the credit default swap market based on the sector of the index. Components of the indices may include, but are not limited to, investment grade securities, high yield securities, asset backed securities, emerging markets, and/or various credit ratings within each sector. Credit indices are traded using credit default swaps with standardized terms including a fixed spread and standard maturity dates. An index credit default swap references all the names in the index, and if there is a default, the credit event is settled based on that name’s weight in the index. The composition of the indices changes periodically, usually every six months, and for most indices, each name has an equal weight in the index. A Fund may use credit default swaps on credit indices to hedge a portfolio of credit default swaps or bonds with a credit default swap on indices which is less expensive than it would be to buy many credit default swap to achieve a similar effect. Credit-default swap on indices are benchmarks for protecting investors owning bonds against default, and traders use them to speculate on changes in credit quality.

For credit default swap agreements on asset-backed securities and credit indices, the quoted market prices and resulting values serve as the indicator of the current status of the payment/performance risk. Wider credit spreads and increasing market values, in absolute terms when compared to the notional amount of the swap, represent a deterioration of the referenced entity’s credit soundness and a greater likelihood or risk of default or other credit event occurring as defined under the terms of the agreement.

Interest rate swaps involve the commitment to exchange cash flows based on changes in the value of a specific reference security or a basket of securities.

As of October 31, 2014 counterparties had pledged collateral for swap agreements of $2,747,424 for Bond & Mortgage Securities Fund and $1,355,677 for High Yield Fund. The collateral is maintained in a segregated account and is not recorded in the books and records of the funds. Certain collateral amounts relate to exchange cleared swaps which are not subject to master netting agreements with counterparties.

To Be Announced Securities. The Funds may trade portfolio securities on a “to-be-announced” (“TBA”) or when-issued basis. In a TBA or when-issued transaction, the Funds commit to purchase or sell securities for which all specific information is not known at the time of the trade. Securities purchased on a TBA or when-issued basis are not settled until they are delivered to the Funds, normally 15 to 30 days later. These transactions are subject to market fluctuations and their current value is determined in the same manner as for other portfolio securities.

Underlying Funds. Principal LifeTime 2010 Fund, Principal LifeTime 2015 Fund, Principal LifeTime 2020 Fund, Principal LifeTime 2025 Fund, Principal LifeTime 2030 Fund, Principal LifeTime 2035 Fund, Principal LifeTime 2040 Fund, Principal LifeTime 2045 Fund, Principal LifeTime 2050 Fund, Principal LifeTime 2055 Fund, Principal LifeTime 2060 Fund, Principal LifeTime Hybrid 2015 Fund, Principal LifeTime Hybrid 2020 Fund, Principal LifeTime Hybrid 2025 Fund, Principal LifeTime Hybrid 2030 Fund, Principal LifeTime Hybrid 2035 Fund, Principal LifeTime Hybrid 2040 Fund, Principal LifeTime Hybrid 2045 Fund, Principal LifeTime Hybrid 2050 Fund, Principal LifeTime Hybrid 2055 Fund, Principal LifeTime Hyrbrid 2060 Fund, Principal LifeTime Hybrid Income Fund, and Principal LifeTime Strategic Income Fund (collectively, the “Principal LifeTime Funds”) along with the SAM Balanced, SAM Conservative Balanced Portfolio, SAM Conservative Growth Portfolio, SAM Flexible Income Portfolio, and SAM Strategic Growth Portfolio (collectively, the “SAM Portfolios”) invest in Institutional Class shares of other series of Principal Funds, Inc. (the "Underlying Funds").

The performance and risks of each Principal LifeTime Fund, and SAM Portfolio (singly, “a fund of funds” and collectively, “the funds of funds”) directly correspond to the performance and risks of the underlying funds in which the fund of funds invest. By investing in many underlying funds, the funds of funds have partial exposure to the risks of many different areas of the market. The more a fund of funds allocates to stock funds, the greater the expected risk.

An underlying fund to a fund of funds may experience relatively large redemptions or purchases as the fund of funds periodically reallocates or rebalances its assets. These transactions may accelerate the realization of taxable income if sales of portfolio securities result in gains and could increase transaction costs. In addition, when a fund of funds reallocates or redeems significant assets away from an underlying fund, the loss of assets to the underlying fund could result in increased expense ratios for that fund.

The Manager is the advisor to the Principal LifeTime Funds, PVC Principal LifeTime Accounts, SAM Portfolios, PVC SAM Portfolios, PVC Diversified Balanced Account, PVC Diversified Balanced Managed Volatility Account, PVC Diversified Growth Account, PVC Diversified Growth Managed Volatility Account, PVC Diversified Income Account, and each of the underlying funds. Principal Global Investors, LLC ("PGI") is Sub-Advisor to the Principal LifeTime Funds, PVC Principal LifeTime Accounts, PVC Diversified Balanced Account, PVC Diversified Balanced Managed Volatility Account, PVC Diversified Growth Account, PVC Diversified Growth Managed Volatility Account, PVC Diversified Income Account, and Edge Asset Management, Inc. ("Edge") is the Sub-Advisor to the SAM Portfolios and PVC SAM Portfolios. Either PGI or Edge also serves as Sub-Advisor to some or all of the underlying funds. The Manager, PGI, and Edge are committed to minimizing the potential impact of underlying fund risk on underlying funds to the extent consistent with pursuing the investment objectives of the fund of funds which it manages. Each may face conflicts of interest in fulfilling its responsibilities to all such funds.

As of October 31, 2014, the SAM Portfolios, Principal LifeTime Funds, PVC SAM Portfolios, PVC Principal LifeTime Accounts, PVC Diversified Balanced Account, PVC Diversified Balanced Managed Volatility Account, PVC Diversified Growth Account, PVC Diversified Growth Managed Volatility Account, and PVC Diversified Income Account owned the following percentages, in the aggregate, of the outstanding shares of the underlying funds listed below:

U.S. Government Agencies or Government-Sponsored Enterprises. Certain of the Funds may invest in U.S. Government agencies or government-sponsored enterprises. U.S. Government securities are obligations of, and in certain cases, guaranteed by, the U.S. Government or its agencies. The U.S. Government does not guarantee the net asset value of the Funds’ shares. Some U.S. Government securities such as treasury bills, notes and bonds, and securities guaranteed by the Government National Mortgage Association (“GNMA”) are supported by the full faith and credit of the U.S. Government. Other securities, such as those of the Federal Home Loan Bank are supported by the right of the issuer to borrow from the U.S. Department of the Treasury. Still other securities, such as those of the Federal National Mortgage Association (“FNMA”) are supported by the discretionary authority of the U.S. Government to purchase the agency’s obligations.

Government related guarantors (those not backed by the full faith and credit of the United States Government) include FNMA and the Federal Home Loan Mortgage Corporation (“FHLMC”). FNMA is a government sponsored corporation, the common stock of which is owned entirely by private stockholders. FNMA purchases conventional residential mortgages from a list of approved seller/servicers which include state and federally chartered savings and loan associations, mutual savings banks, commercial banks, credit unions, and mortgage bankers. Pass-through securities issued by FNMA are guaranteed as to the timely payment of principal and interest by FNMA, but are not backed by the full faith and credit of the U.S. Government. FHLMC issues Participation Certificates which are pass-through securities, each representing an undivided interest in a pool of residential mortgages. FHLMC guarantees the timely payment of interest and ultimate collection of principal, but Participation Certificates are not backed by the full faith and credit of the U.S. Government.

Derivatives. The following tables provide information about where in the statements of assets and liabilities and statements of operations information about derivatives can be found (amounts shown in thousands):


	Asset Derivatives October 31, 2014			Liability Derivatives October 31, 2014
Derivatives not accounted for			Fair			Fair
as hedging instruments	Statement of Assets and Liabilities Location		Value	Statement of Assets and Liabilities Location		Value
Bond & Mortgage Securities Fund
Credit contracts	Receivables, Net Assets Consist of Net unrealized	$	2,201	Payables, Net Assets Consist of Net unrealized	$	1,223
	appreciation (depreciation) of investments			appreciation (depreciation) of investments
Foreign exchange contracts	Receivables	$	301	Payables	$	41
Interest rate contracts	Receivables, Net Assets Consist of Net unrealized	$	—	Payables, Net Assets Consist of Net unrealized	$	729	^*
	appreciation (depreciation) of investments			appreciation (depreciation) of investments
		Total$	2,502		$	1,993
Global Diversified Income Fund
Equity contracts	Receivables, Net Assets Consist of Net unrealized	$	—	Payables, Net Assets Consist of Net unrealized	$	64,767
	appreciation (depreciation) of investments			appreciation (depreciation) of investments
Foreign exchange contracts	Receivables	$	8,652	Payables	$	1,364
		Total$	8,652		$	66,131
High Yield Fund
Credit contracts	Receivables, Net Assets Consist of Net unrealized	$	304	Payables, Net Assets Consist of Net unrealized	$	—
	appreciation (depreciation) of investments			appreciation (depreciation) of investments
Foreign exchange contracts	Receivables	$	1,710	Payables	$	—
		Total$	2,014
Inflation Protection Fund
Foreign exchange contracts	Receivables	$	970	Payables	$	108
Interest rate contracts	Receivables, Net Assets Consist of Net unrealized	$	1,546^*Payables, Net Assets Consist of Net unrealized		$	3,489	^*
	appreciation (depreciation) of investments			appreciation (depreciation) of investments
		Total$	2,516		$	3,597
International Fund I
Equity contracts	Receivables, Net Assets Consist of Net unrealized	$	193^*Payables, Net Assets Consist of Net unrealized		$	—
	appreciation (depreciation) of investments			appreciation (depreciation) of investments
LargeCap Growth Fund I
Equity contracts	Receivables, Net Assets Consist of Net unrealized	$	4,634^*Payables, Net Assets Consist of Net unrealized		$	—
	appreciation (depreciation) of investments			appreciation (depreciation) of investments
LargeCap S&P 500 Index Fund
Equity contracts	Receivables, Net Assets Consist of Net unrealized	$	2,523^*Payables, Net Assets Consist of Net unrealized		$	—
	appreciation (depreciation) of investments			appreciation (depreciation) of investments
LargeCap Value Fund
Equity contracts	Receivables, Net Assets Consist of Net unrealized	$	452^*Payables, Net Assets Consist of Net unrealized		$	—
	appreciation (depreciation) of investments			appreciation (depreciation) of investments
MidCap Value Fund III
Equity contracts	Receivables, Net Assets Consist of Net unrealized	$	716^*Payables, Net Assets Consist of Net unrealized		$	—
	appreciation (depreciation) of investments			appreciation (depreciation) of investments
SmallCap Blend Fund
Equity contracts	Receivables, Net Assets Consist of Net unrealized	$	253^*Payables, Net Assets Consist of Net unrealized		$	—
	appreciation (depreciation) of investments			appreciation (depreciation) of investments

*Includes cumulative unrealized appreciation/depreciation of futures contracts as shown in the schedules of investments. Only the portion of the unrealized appreciation/depreciation not yet cash settled is shown in the statements of assets and liabilities as variation margin.


						Change in Unrealized
						Appreciation/(Depreciation) of
Derivatives not accounted for	Location of Gain or (Loss) on Derivatives		Realized Gain or (Loss) on Derivatives			Derivatives Recognized in Statement
as hedging instruments	Recognized in Statement of Operations		Recognized in Statement of Operations			of Operations
Bond & Mortgage Securities Fund
Credit contracts	Net realized gain (loss) from Swap	$	(3,734	)	$	651
	agreements/Change in unrealized
	appreciation/(depreciation) of Swap
	agreements
Foreign exchange contracts	Net realized gain (loss) from Foreign	$	107		$	331
	currency transactions/Change in unrealized
	appreciation/(depreciation) of Translation of
	assets and liabilities in foreign currencies
Interest rate contracts	Net realized gain (loss) from Futures	$	632		$	(1,718	)
	contracts and Swap agreements/Change in
	unrealized appreciation/(depreciation) of
	Futures contracts and Swap agreements
	Total	$	(2,995	)	$	(736	)
Global Diversified Income Fund
Equity contracts	Net realized gain (loss) from Options and	$	(2,407	)	$	(46,669	)
	swaptions/Change in unrealized
	appreciation/(depreciation) of Options and
	swaptions
Foreign exchange contracts	Net realized gain (loss) from Foreign	$	13,987		$	7,826
	currency transactions/Change in unrealized
	appreciation/(depreciation) of Translation of
	assets and liabilities in foreign currencies
	Total	$	11,580		$	(38,843	)
High Yield Fund
Credit contracts	Net realized gain (loss) from Swap	$	45		$	304
	agreements/Change in unrealized
	appreciation/(depreciation) of Swap
	agreements
Foreign exchange contracts	Net realized gain (loss) from Foreign	$	5,369		$	1,710
	currency transactions/Change in unrealized
	appreciation/(depreciation) of Translation of
	assets and liabilities in foreign currencies
	Total	$	5,414		$	2,014
High Yield Fund I
Foreign exchange contracts	Net realized gain (loss) from Foreign	$	(24	)	$	(2	)
	currency transactions/Change in unrealized
	appreciation/(depreciation) of Translation of
	assets and liabilities in foreign currencies
Inflation Protection Fund
Foreign exchange contracts	Net realized gain (loss) from Investment	$	6,744		$	396
	transactions and Foreign currency
	transactions/Change in unrealized
	appreciation/(depreciation) of Investments
	and Translation of assets and liabilities in
	foreign currencies
Interest rate contracts	Net realized gain (loss) from Investment	$	(10,238	)	$	(1,378	)
	transactions, Futures contracts, Options and
	swaptions, and Swap agreements/Change in
	unrealized appreciation/(depreciation) of
	Investments, Futures contracts, Options and
	swaptions, and Swap agreements
	Total	$	(3,494	)	$	(982	)


	NOTES TO FINANCIAL STATEMENTS
PRINCIPAL FUNDS, INC.
October 31, 2014


3. Operating Policies (Continued)

				Change in Unrealized
				Appreciation/(Depreciation) of
Derivatives not accounted for	Location of Gain or (Loss) on Derivatives	Realized Gain or (Loss) on Derivatives		Derivatives Recognized in Statement
as hedging instruments	Recognized in Statement of Operations	Recognized in Statement of Operations		of Operations
International Fund I
Equity contracts	Net realized gain (loss) from Futures	$	2,675	$	(297	)
	contracts/Change in unrealized
	appreciation/(depreciation) of Futures
	contracts
Foreign exchange contracts	Net realized gain (loss) from Foreign	$	11,189	$	—
	currency transactions/Change in unrealized
	appreciation/(depreciation) of Translation of
	assets and liabilities in foreign currencies
	Total	$	13,864	$	(297	)
LargeCap Growth Fund I
Equity contracts	Net realized gain (loss) from Futures	$	30,395	$	(2,009	)
	contracts/Change in unrealized
	appreciation/(depreciation) of Futures
	contracts
LargeCap S&P 500 Index Fund
Equity contracts	Net realized gain (loss) from Futures	$	14,353	$	(803	)
	contracts/Change in unrealized
	appreciation/(depreciation) of Futures
	contracts
LargeCap Value Fund
Equity contracts	Net realized gain (loss) from Futures	$	5,620	$	(984	)
	contracts/Change in unrealized
	appreciation/(depreciation) of Futures
	contracts
MidCap Value Fund III
Equity contracts	Net realized gain (loss) from Futures	$	3,892	$	(207	)
	contracts/Change in unrealized
	appreciation/(depreciation) of Futures
	contracts
SmallCap Blend Fund
Equity contracts	Net realized gain (loss) from Futures	$	1,325	$	(110	)
	contracts/Change in unrealized
	appreciation/(depreciation) of Futures
	contracts
SmallCap Value Fund II
Equity contracts	Net realized gain (loss) from Futures	$	4,628	$	1,258
	contracts/Change in unrealized
	appreciation/(depreciation) of Futures
	contracts

Long equity futures contracts are used to obtain market exposure for the cash balances that are maintained by certain of the Funds and the notional values of the futures contracts will vary in accordance with changing cash balances. Long and short U.S. Treasury futures contracts are used to obtain interest rate exposure in order to manage duration of Bond & Mortgage Securities Fund and Inflation Protection Fund. The notional values of the futures contracts will vary in accordance with changing duration of these funds. The level of other derivative activity disclosed in the schedules of investments is representative of the level of derivative activity used in the Funds throughout the year ended October 31, 2014.

Fair value is defined as the price that the Funds would receive upon selling a security in a timely transaction to an independent buyer in the principal or most advantageous market of the security at the measurement date. In determining fair value, the Funds use various valuation approaches, including market, income and/or cost approaches. A hierarchy for inputs is used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available.

Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Funds. Unobservable inputs are inputs that reflect the Funds own estimates about the estimates market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.

The three-tier hierarchy of inputs is summarized in the three broad levels listed below.

ÏLevel 1 – Quoted prices are available in active markets for identical securities as of the reporting date. The type of securities included in Level 1 includes listed equities and listed derivatives.

ÏLevel 2 – Other significant observable inputs (including quoted prices for similar investments, interest rates, prepayments speeds, credit risk, etc.) Investments which are generally included in this category include corporate bonds, senior floating rate interests, and municipal bonds.

ÏLevel 3 – Significant unobservable inputs (including the Funds’ assumptions in determining the fair value of investments.) Investments which are generally included in this category include certain corporate bonds and certain mortgage backed securities.

The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, for example, the type of security, whether the security is new and not yet established in the market place, and other characteristics particular to the transaction. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Funds in determining fair value is greatest for instruments categorized in Level 3.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes the level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety.

Fair value is a market based measure considered from the perspective of a market participant who holds the asset rather than an entity specific measure. Therefore, even when market assumptions are not readily available, the Fund’s own assumptions are set to reflect those that market participants would use in pricing the asset or liability at the measurement date. The Funds use prices and inputs that are current as of the measurement date.

Investments which are generally included in the Level 3 category are primarily valued using quoted prices from brokers and dealers participating in the market for these investments. These investments are classified as Level 3 investments due to the lack of market transparency and market corroboration to support these quoted prices. Valuation models may be used as the pricing source for other investments classified as Level 3. Valuation models rely on one or more significant unobservable inputs such as prepayment rates, probability of default, or loss severity in the event of default. Significant increases in any of those inputs in isolation would result in a significantly lower fair value measurement.

The fair values of these entities are dependent on economic, political and other considerations. The values of the underlying investee entities may be affected by significant changes in the economic conditions, changes in government policies, and other factors (e.g., natural disasters, accidents, conflicts, etc.).

Fair value of these investments is determined in good faith by the Manager under procedures established and periodically reviewed by the Fund’s Board of Directors. The Manager has established a Valuation Committee of senior officers and employees, with the responsibility of overseeing the pricing and valuation of all securities, including securities where market quotations are not readily available. The Valuation Committee meets monthly and reports directly to the Board of Directors. The Pricing Group who reports to the Valuation Committee relies on the established Pricing Policies to determine fair valuation. Included in the Pricing Policies is an overview of the approved valuation technique established for each asset class. The Pricing Group will consider all appropriate information available when determining fair valuation.

The Pricing Group relies on externally provided inputs to value Level 3 securities. Security values are updated as new information becomes available. Valuation data and changes in valuation amounts are reviewed on a daily basis based on specified criteria for the security, asset class, and other factors. In addition, valuation data is periodically compared to actual transactions executed by the Funds (i.e., purchases/sales) and differences between transaction prices and prior period valuation data are investigated based on specified tolerances.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those instruments. For example, short-term securities held in Money Market Fund are valued using amortized cost, as permitted under Rule 2a-7 of the Investment Company Act of 1940. Generally, amortized cost approximates the current fair value of these securities, but because the value is not obtained from a quoted price in an active market, such securities are reflected as Level 2.

The beginning of the period timing recognition has been adopted for the significant transfers between levels of each Fund’s assets and liabilities. There were no significant purchases, sales, or transfers into or out of Level 3, except as noted in the Level 3 roll forward. The table below includes transfers from Level 1 to Level 2 as of October 31, 2014 due to lack of exchange traded valuation data; however observable market inputs were available to support these valuations:

Below are transfers from Level 2 to Level 1 as of October 31, 2014 due to the resumption of trading for previous thinly traded securities:

The following is a summary of the inputs used as of October 31, 2014, in valuing the Funds’ securities carried at value (amounts shown in thousands):


NOTES TO FINANCIAL STATEMENTS
PRINCIPAL FUNDS, INC.
October 31, 2014


4. Fair Valuation (Continued)
				Level 2 - Other
		Level 1 - Quoted		Significant Observable				Level 3 - Significant
Fund		Prices			Inputs			Unobservable Inputs Totals (Level 1,2,3)

Bond & Mortgage Securities Fund (Continued)
Assets
Credit Contracts**
Credit Default Swaps	$	—		$	2,201		$	—	$	2,201
Foreign Exchange Contracts**
Foreign Currency Contracts	$	—		$	301		$	—	$	301
Liabilities
Credit Contracts**
Exchange Cleared Credit Default Swaps	$	—		$	(1,223	)	$	—	$	(1,223	)
Foreign Exchange Contracts**
Foreign Currency Contracts	$	—		$	(41	)	$	—	$	(41	)
Interest Rate Contracts**
Futures	$	(729	)	$	—		$	—	$	(729	)

California Municipal Fund
Municipal Bonds	$	—		$	221,408		$	—	$	221,408
Total investments in securities $		—		$	221,408		$	—	$	221,408

Diversified International Fund
Common Stocks
Basic Materials	$	—		$	181,441		$	—	$	181,441
Communications		54,653			498,192			—		552,845
Consumer, Cyclical		132,285			523,397			—		655,682
Consumer, Non-cyclical		130,718			913,529			—		1,044,247
Energy		97,642			230,762			—		328,404
Financial		310,943			1,129,906			—		1,440,849
Industrial		124,591			558,151			—		682,742
Technology		—			268,260			—		268,260
Utilities		13,102			187,628			—		200,730
Investment Companies		147,497			—			—		147,497
Preferred Stocks
Consumer, Non-cyclical		—			20,857			—		20,857
Total investments in securities $		1,011,431		$	4,512,123		$	—	$	5,523,554

Equity Income Fund
Common Stocks*	$	5,836,831		$	—		$	—	$	5,836,831
Investment Companies		138,015			—			—		138,015
Total investments in securities $		5,974,846		$	—		$	—	$	5,974,846

Global Diversified Income Fund
Bonds	$	—		$	5,593,124		$	54,236	$	5,647,360
Common Stocks
Basic Materials		14,160			40,290			—		54,450
Communications		98,755			104,550			11		203,316
Consumer, Cyclical		45,839			51,402			—		97,241
Consumer, Non-cyclical		128,340			138,119			—		266,459
Diversified		965			22,595			—		23,560
Energy		646,911			50,210			—		697,121
Financial		383,365			342,307			—		725,672
Industrial		84,071			166,134			—		250,205
Technology		70,863			19,907			—		90,770
Utilities		480,145			202,000			—		682,145
Convertible Bonds		—			—			5,786		5,786
Credit Linked Structured Notes		—			7,230			3,715		10,945
Investment Companies		322,924			—			—		322,924
Preferred Stocks
Communications		20,320			14,934			—		35,254
Financial		168,317			30,542			—		198,859
Industrial		18,867			254			—		19,121
Utilities		21,899			9,529			—		31,428
Senior Floating Rate Interests		—			553,528			—		553,528
Total investments in securities $		2,505,741		$	7,346,655		$	63,748	$	9,916,144
Short Sales
Common Stocks
Exchange Traded Funds	$	(20	)	$	—		$	—	$	(20	)
	Total Short Sales $	(20	)	$	—		$	—	$	(20	)


NOTES TO FINANCIAL STATEMENTS
PRINCIPAL FUNDS, INC.
October 31, 2014


4. Fair Valuation (Continued)
				Level 2 - Other
		Level 1 - Quoted		Significant Observable				Level 3 - Significant
Fund		Prices			Inputs			Unobservable Inputs Totals (Level 1,2,3)

Global Diversified Income Fund (Continued)
Assets
Foreign Exchange Contracts**
Foreign Currency Contracts	$	—		$	8,652		$	—	$	8,652
Liabilities
Equity Contracts**
Options	$	(64,767	)	$	—		$	—	$	(64,767	)
Foreign Exchange Contracts**
Foreign Currency Contracts	$	—		$	(1,364	)	$	—	$	(1,364	)

Global Real Estate Securities Fund
Common Stocks
Consumer, Cyclical	$	—		$	49,090		$	—	$	49,090
Consumer, Non-cyclical		18,339			—			—		18,339
Diversified		—			30,264			—		30,264
Financial		1,314,952			909,170			—		2,224,122
Investment Companies		14,628			—			—		14,628
Total investments in securities $		1,347,919		$	988,524		$	—	$	2,336,443

Government & High Quality Bond Fund
Bonds	$	—		$	478,041		$	19,838	$	497,879
Investment Companies		17,843			—			—		17,843
U.S. Government & Government Agency Obligations		—			1,154,674			—		1,154,674
Total investments in securities $		17,843		$	1,632,715		$	19,838	$	1,670,396

High Yield Fund
Bonds	$	—		$	3,156,995		$	22,925	$	3,179,920
Common Stocks*		—			—			—		—
Convertible Bonds		—			24,848			—		24,848
Investment Companies		150,101			—			—		150,101
Preferred Stocks
Financial		—			29,589			—		29,589
Senior Floating Rate Interests		—			274,312			—		274,312
Total investments in securities $		150,101		$	3,485,744		$	22,925	$	3,658,770
Assets
Credit Contracts**
Exchange Cleared Credit Default Swaps	$	—		$	304		$	—	$	304
Foreign Exchange Contracts**
Foreign Currency Contracts	$	—		$	1,710		$	—	$	1,710

High Yield Fund I
Bonds	$	—		$	1,579,211		$	9,676	$	1,588,887
Common Stocks
Basic Materials		—			—			1,273		1,273
Consumer, Cyclical		105			—			—		105
Financial		—			—			248		248
Industrial		475			—			11		486
Technology		—			—			—		—
Utilities		610			—			—		610
Convertible Bonds		—			—			614		614
Investment Companies		59,644			—			—		59,644
Preferred Stocks
Financial		3,868			2,049			—		5,917
Industrial		—			—			—		—
Technology		—			—			—		—
Senior Floating Rate Interests		—			109,156			—		109,156
Total investments in securities $		64,702		$	1,690,416		$	11,822	$	1,766,940

Income Fund
Bonds	$	—		$	1,739,676		$	12,327	$	1,752,003
Common Stocks
Financial		—			—			5		5
Industrial		—			—			—		—
Technology		—			—			—		—
Convertible Bonds		—			36,708			—		36,708
Investment Companies		150,754			—			—		150,754
Senior Floating Rate Interests		—			16,861			—		16,861
U.S. Government & Government Agency Obligations		—			879,264			—		879,264
Total investments in securities $		150,754		$	2,672,509		$	12,332	$	2,835,595


NOTES TO FINANCIAL STATEMENTS
PRINCIPAL FUNDS, INC.
October 31, 2014


4. Fair Valuation (Continued)
				Level 2 - Other
		Level 1 - Quoted		Significant Observable				Level 3 - Significant
Fund		Prices			Inputs			Unobservable Inputs Totals (Level 1,2,3)

Inflation Protection Fund
Bonds	$	—		$	69,994		$	—	$	69,994
Investment Companies		2,717			—			—		2,717
U.S. Government & Government Agency Obligations		—			990,837			—		990,837
Purchased Capped Options		—			4			—		4
Purchased Options		992			2			—		994
Total investments in securities $		3,709		$	1,060,837		$	—	$	1,064,546
Assets
Foreign Exchange Contracts**
Foreign Currency Contracts	$	—		$	968		$	—	$	968
Interest Rate Contracts**
Futures	$	185		$	—		$	—	$	185
Interest Rate Swaps		—			30			—		30
Liabilities
Foreign Exchange Contracts**
Foreign Currency Contracts	$	—		$	(108	)	$	—	$	(108	)
Interest Rate Contracts**
Exchange Cleared Interest Rate Swaps	$	—		$	(712	)	$	—	$	(712	)
Futures		(1,803	)		—			—		(1,803	)
Interest Rate Swaps		—			(106	)		—		(106	)
Interest Rate Swaptions		—			(277	)		—		(277	)
Options		(591	)		—			—		(591	)

International Emerging Markets Fund
Common Stocks
Basic Materials	$	31,415		$	50,288		$	—	$	81,703
Communications		30,139			242,853			—		272,992
Consumer, Cyclical		33,063			94,700			—		127,763
Consumer, Non-cyclical		119,290			125,640			—		244,930
Diversified		—			—			—		—
Energy		51,119			82,328			—		133,447
Financial		107,276			451,411			—		558,687
Industrial		23,405			115,823			—		139,228
Technology		—			278,542			—		278,542
Utilities		—			100,627			—		100,627
Investment Companies		31,631			—			—		31,631
Preferred Stocks
Communications		—			7,405			—		7,405
Consumer, Non-cyclical		—			9,858			—		9,858
Energy		—			15,362			—		15,362
Financial		—			64,228			—		64,228
Utilities		—			2,043			—		2,043
Total investments in securities $		427,338		$	1,641,108		$	—	$	2,068,446

International Fund I
Common Stocks
Basic Materials	$	1,446		$	17,742		$	—	$	19,188
Communications		2,898			18,618			—		21,516
Consumer, Cyclical		15,888			60,933			—		76,821
Consumer, Non-cyclical		9,830			33,868			—		43,698
Energy		2,964			12,819			—		15,783
Financial		6,199			61,989			—		68,188
Industrial		1,749			36,728			—		38,477
Technology		12,839			29,062			—		41,901
Utilities		—			13,620			—		13,620
Investment Companies		5,393			—			—		5,393
Total investments in securities $		59,206		$	285,379		$	—	$	344,585
Assets
Equity Contracts**
Futures	$	193		$	—		$	—	$	193

LargeCap Growth Fund
Common Stocks*	$	3,264,816		$	—		$	—	$	3,264,816
Investment Companies		105,009			—			—		105,009
Total investments in securities $		3,369,825		$	—		$	—	$	3,369,825


NOTES TO FINANCIAL STATEMENTS
PRINCIPAL FUNDS, INC.
October 31, 2014


4. Fair Valuation (Continued)
			Level 2 - Other
		Level 1 - Quoted	Significant Observable			Level 3 - Significant
Fund		Prices		Inputs		Unobservable Inputs Totals (Level 1,2,3)

LargeCap Growth Fund I
Common Stocks*	$	7,598,803	$	—	$	—	$	7,598,803
Convertible Preferred Stocks
Communications		—		4,948		5,004		9,952
Investment Companies		164,910		—		—		164,910
	Total investments in securities $	7,763,713	$	4,948	$	5,004	$	7,773,665
Assets
Equity Contracts**
Futures	$	4,634	$	—	$	—	$	4,634

LargeCap S&P 500 Index Fund
Common Stocks*	$	4,141,594	$	—	$	—	$	4,141,594
Investment Companies		107,769		—		—		107,769
	Total investments in securities $	4,249,363	$	—	$	—	$	4,249,363
Assets
Equity Contracts**
Futures	$	2,523	$	—	$	—	$	2,523

LargeCap Value Fund
Common Stocks*	$	3,673,823	$	—	$	—	$	3,673,823
Investment Companies		77,302		—		—		77,302
	Total investments in securities $	3,751,125	$	—	$	—	$	3,751,125
Assets
Equity Contracts**
Futures	$	452	$	—	$	—	$	452

MidCap Fund
Common Stocks*	$	8,847,298	$	—	$	—	$	8,847,298
Investment Companies		28,289		—		—		28,289
	Total investments in securities $	8,875,587	$	—	$	—	$	8,875,587

MidCap Value Fund III
Common Stocks*	$	942,284	$	—	$	—	$	942,284
Investment Companies		35,196		—		—		35,196
	Total investments in securities $	977,480	$	—	$	—	$	977,480
Assets
Equity Contracts**
Futures	$	716	$	—	$	—	$	716

Money Market Fund
Bonds	$	—	$	141,565	$	—	$	141,565
Certificate of Deposit		—		35,500		—		35,500
Commercial Paper		—		739,988		—		739,988
Investment Companies		62,180		—		—		62,180
Municipal Bonds		—		55,565		—		55,565
Repurchase Agreements		—		48,240		—		48,240
	Total investments in securities $	62,180	$	1,020,858	$	—	$	1,083,038

Principal Capital Appreciation Fund
Common Stocks*	$	2,436,744	$	—	$	—	$	2,436,744
Investment Companies		57,955		—		—		57,955
	Total investments in securities $	2,494,699	$	—	$	—	$	2,494,699

Real Estate Securities Fund
Common Stocks*	$	2,023,466	$	—	$	—	$	2,023,466
Investment Companies		20,528		—		—		20,528
	Total investments in securities $	2,043,994	$	—	$	—	$	2,043,994

Short-Term Income Fund
Bonds	$	—	$	2,398,982	$	33,574	$	2,432,556
Investment Companies		52,241		—		—		52,241
U.S. Government & Government Agency Obligations		—		42,921		—		42,921
	Total investments in securities $	52,241	$	2,441,903	$	33,574	$	2,527,718


NOTES TO FINANCIAL STATEMENTS
PRINCIPAL FUNDS, INC.
October 31, 2014


4. Fair Valuation (Continued)
				Level 2 - Other
		Level 1 - Quoted	Significant Observable			Level 3 - Significant
Fund		Prices		Inputs		Unobservable Inputs Totals (Level 1,2,3)

SmallCap Blend Fund
Common Stocks*	$	489,136	$	—	$	—	$	489,136
Investment Companies		17,750		—		—		17,750
	Total investments in securities $	506,886	$	—	$	—	$	506,886
Assets
Equity Contracts**
Futures	$	253	$	—	$	—	$	253

SmallCap Value Fund II
Common Stocks
Basic Materials	$	68,068	$	—	$	—	$	68,068
Communications		46,885		163		—		47,048
Consumer, Cyclical		212,542		—		—		212,542
Consumer, Non-cyclical		254,236		4		—		254,240
Diversified		887		—		—		887
Energy		85,315		493		—		85,808
Financial		414,528		9		12		414,549
Government		199		—		—		199
Industrial		222,073		120		—		222,193
Technology		172,233		—		—		172,233
Utilities		23,448		—		—		23,448
Investment Companies		64,080		—		—		64,080
	Total investments in securities $	1,564,494	$	789	$	12	$	1,565,295
Assets
Equity Contracts**
Futures	$	3,156	$	—	$	—	$	3,156

Tax-Exempt Bond Fund
Bonds	$	—	$	2,190	$	—	$	2,190
Municipal Bonds		—		218,468		—		218,468
	Total investments in securities $	—	$	220,658	$	—	$	220,658

*For additional detail regarding sector classifications, please see the Schedule of Investments.
**Exchange cleared swaps, futures, and foreign currency contracts are valued at the unrealized appreciation/(depreciation) of the instrument.

Certain detailed information is provided for those Funds with significant investments in Level 3 securities. Quantitative information about the significant unobservable inputs used in the fair value measurements categorized within Level 3 of the fair value hierarchy is as follows (amounts in thousands):

The changes in investments measured at fair value for which Level 3 inputs have been used to determine fair value are as follows (amounts shown in thousands):

Management Services. The Funds have agreed to pay investment advisory and management fees to the Manager (wholly owned by Principal Financial Services, Inc.) computed at an annual percentage rate of each of the Funds’ average daily net assets. A portion of the management fee is paid by the Manager to the sub-advisor of each of the Funds, some of which are affiliates of the Manager. The annual rates used in this calculation for the Funds are as follows:


					Net Assets of Funds																		Net Assets of Funds

		First			Next			Next		Over							First						Next			Next
		$500			$500			$500		$1.5							$500						$500			$500		Over $1.5
		million			million			million		billion							million					million				million		Billion
Global Real Estate Securities Fund		.90	%		.88	%		.86	%	.85	%	SmallCap Blend Fund					.75				%		.73	%		.71	%	.70	%
Inflation Protection Fund		.40			.38			.36		.35		SmallCap Value Fund II								1.00			.98			.96		.95
MidCap Value Fund III		.65			.63			.61		.60		Tax-Exempt Bond Fund								.45			.43			.41		.40

																										Net Assets of Fund (in
					Net Assets of Fund (in Billions)																					Billions)

					First $1			Over $1															First $2					Over $2
California Municipal Fund					.45	%		.40			%	Government & High Quality Bond Fund														.50	%	.45	%

		Net Assets of Fund (in millions)																					Net Assets of Fund
																				First						Next
		First			Next			Over											$	500					$	500		Over $1
	$	200		$	300		$	500												million						million		billion
Short-Term Income Fund		.50	%		.45	%		.40	%	Principal Capital Appreciation Fund										.625		%				.50	%	.375	%

		Net Assets of Fund (in millions)																		Net Assets of Fund (in Billions)
		First						Over
	$	250					$	250									First $2									Next $1		Over $3
High Yield Fund		.625	%					.50	%					Income Fund									.50%			.44	%	.43	%

								Net Assets of Funds
		First						Next				Next			Next		Next $1			Over $3
		$500 million						$500 million				$500 million		$500 million			billion			billion
Bond & Mortgage Securities Fund					.55	%		.53	%			.51	%	.50		%	.48	%		.45				%
Diversified International Fund					.90			.88				.86		.85			.83						.80
Global Diversified Income Fund					.80			.78				.76		.75			.73						.70
High Yield Fund I					.65			.63				.61		.60			.59						.58
International Emerging Markets Fund					1.20			1.18		1.16				1.15			1.14			1.13
International Fund I					.90			.88				.86		.85			.84						.83
LargeCap Growth Fund I					.66			.64				.62		.61			.60						.59
Large Cap Value Fund					.45			.43				.41		.40			.39						.38
MidCap Fund					.65			.63				.61		.60			.59						.58
Money Market Fund					.40			.39				.38		.37			.36						.35
Real Estate Securities Fund					.85			.83				.81		.80			.79						.78

					Net Assets of Fund
		First			Next
		$500			$500			Next $1		Next $1		Over $3
		million			million			billion		billion		billion
LargeCap Growth Fund		.68	%		.65	%		.62	%	.58	%	.55	%

		Net Assets of Fund (in millions)
		First			Next			Over
	$	250		$	250		$	500
Equity Income Fund		.60	%		.55	%		.50	%


					All Net Assets
LargeCap S&P 500 Index Fund					.15	%

In addition to the management fee, R-1, R-2, R-3, R-4, and R-5 classes of shares of the Funds pay the Manager a service fee and an administrative service fee computed at an annual percentage rate of each class’s average daily net assets. The annual rates for the service fee are .25%, .25%, .25%, .25%, and .25% and the annual rates for the administrative service fee are .28%, .20%, .07%, .03%, and .01% for R-1, R-2, R-3, R-4, and R-5, respectively. Class A, Class B, Class C, Class P, and Institutional shares of the Funds reimburse Principal Shareholder Services, Inc. (the “Transfer Agent”) (wholly owned by the Manager) for transfer agent services. Class J shares pays Principal Shareholder Services, Inc. a fee for the services provided in an amount that includes a profit.

The Manager has contractually agreed to limit the expenses (excluding interest the Funds incur in connection with investments they make) for certain classes of shares of certain of the Funds. The reductions and reimbursements are in amounts that maintain total operating expenses at or below certain limits. The limits are expressed as a percentage of average daily net assets attributable to each class of shares on an annualized basis during the reporting period. The operating expense limits are as follows:


			Period from November 1, 2013 through October 31, 2014
	Class A		Class B		Class C		Class J	Institutional	Expiration
Bond & Mortgage Securities Fund	.88	%	1.60	%	1.75	%	N/A	N/A	February 28, 2015
California Municipal Fund	N/A		1.82		N/A		N/A	N/A	February 28, 2015
Diversified International Fund	N/A		2.47		2.08		N/A	N/A	February 28, 2015
Equity Income Fund	N/A		1.97		N/A		N/A	N/A	February 28, 2015
Global Diversified Income Fund	1.25		N/A		2.00		N/A	N/A	February 28, 2014
Global Real Estate Securities Fund	1.45		N/A		2.20		N/A	1.00	February 28, 2015
Government & High Quality Bond Fund	.88		1.65		1.63		1.00%	N/A	February 28, 2015
High Yield Fund	N/A		1.92		N/A		N/A	.61	February 28, 2015
High Yield Fund I	1.05		N/A		N/A		N/A	N/A	February 28, 2015
Income Fund	N/A		1.90		N/A		1.10	N/A	February 28, 2015
Inflation Protection Fund	.90		N/A		1.65		1.15	N/A	February 28, 2015
International Emerging Markets Fund	1.78		2.78		2.80		N/A	N/A	February 28, 2015
International Fund I	1.45	^	N/A		N/A		N/A	N/A	February 29, 2016
LargeCap Growth Fund	N/A		2.25		N/A		N/A	N/A	February 28, 2015
LargeCap Growth Fund I	1.25		N/A		N/A		N/A	N/A	February 28, 2015
LargeCap S&P 500 Index Fund	.70	*	N/A		1.30		N/A	N/A	February 28, 2015
LargeCap Value Fund	N/A		2.00		1.70		N/A	N/A	February 28, 2015
MidCap Fund	N/A		2.09		1.95	*	N/A	N/A	February 28, 2015
MidCap Value Fund III	1.30	^	N/A		N/A		N/A	.736	February 28, 2015
Money Market Fund	N/A		1.55		1.79		N/A	N/A	February 28, 2015
Principal Capital Appreciation Fund	N/A		1.99		1.82		N/A	N/A	February 28, 2015
Real Estate Securities Fund	1.45	*	2.20		2.20		N/A	N/A	February 28, 2015
Short-Term Income Fund	N/A		N/A		1.67		N/A	N/A	February 28, 2014
SmallCap Blend Fund	1.35		2.29		2.08		N/A	0.80	February 28, 2015
SmallCap Value Fund II	1.45	^	N/A		N/A		1.926*	N/A	February 29, 2016
Tax-Exempt Bond Fund	.85	*	1.60		1.60		N/A	N/A	February 28, 2015

In addition, the Manager has contractually agreed to limit certain of the Funds’ management and investment advisory fees through the period ending February 29, 2016. The expense limit will reduce the Fund’s management and investment advisory fees by the following amounts:

The Manager has also voluntarily agreed to limit Money Market Fund’s expenses for all classes of shares to the extent necessary to maintain a 0% yield. The voluntary expense limit may be terminated at any time.

In addition, the Manager has contractually agreed to limit Class P expenses other than management and investment advisory fees and distribution fees and, if necessary, pay expenses normally payable by the Fund, excluding interest expense, expenses related to fund investments, acquired fund fees and investments, and other extraordinary expenses, through the period ending February 28, 2015. The expense limit will maintain these expenses (expressed as a percent of average net assets on an annualized basis) not to exceed .20% for each of Diversified International Fund, Equity Income Fund, Global Diversified Income Fund, Global Real Estate Securities Fund, Government & High Quality Bond Fund, High Yield Fund, Income Fund, International Emerging Markets Fund, LargeCap Growth Fund, MidCap Fund, Principal Capital Appreciation Fund, Real Estate Securities Fund and Short Term Income Fund, respectively.

In addition, the Manager has contractually agreed to limit Class P expenses other than management and investment advisory fees and distribution fees and, if necessary, pay expenses normally payable by the Fund, excluding interest expense, expenses related to fund investments, acquired fund fees and investments, and other extraordinary expenses, through the period ending February 29, 2016. The expense limit will maintain these expenses (expressed as a percent of average net assets on an annualized basis) not to exceed .20% for each of International Fund I, LargeCap Growth Fund I, LargeCap Value Fund, MidCap Value Fund III, SmallCap Blend Fund, and SmallCap Value Fund II, respectively.

The Manager has voluntarily agreed to limit certain of the Fund’s expenses attributable to Class J shares of Bond & Mortgage Securities Fund and Short-Term Income Fund by paying, if necessary, expenses normally payable by the Fund, excluding interest expense, expenses related to fund investments, acquired fund fees and expenses, and other extraordinary expenses. The expense limits will maintain a total level of operating expenses (expressed as a percent of average net assets on an annualized basis) not to exceed .99% and 1.00%, respectively. The expense limit may be terminated at any time.

The Manager contractually agreed to pay a portion of the expenses directly attributable to Institutional Class shares of Bond & Mortgage Securities Fund through the period ending February 28, 2014.

Amounts owed to the Funds under the terms of the expense limitation agreements are reflected in the statement of assets and liabilities as expense reimbursement from Manager.

Distribution Fees. The Class A, Class B, Class C, Class J, R-1, R-2, R-3 and R-4 shares of the Funds bear distribution fees. The fee is computed at an annual rate of the average daily net assets attributable to each class of each of the Funds. Distribution fees are paid to Principal Funds Distributor, Inc. (“the Distributor”), the principal distributor of the Funds. A portion of the distribution fees may be paid to other selling dealers for providing certain services. The annual rates are .25%, 1.00%, 1.00%, .25%*, .35%, .30%, .25% and .10% for, Class A, Class B, Class C, Class J, R-1, R-2, R-3 and R-4 classes of shares, respectively, except the following classes of shares:

*Prior to December 30, 2013, the annual rate for Class J was .45% (with the exception of Money Market Fund whose annual rate for Class J was .25%).

Effective December 30, 2013, the Distributor has contractually agreed to limit the distribution fees (expressed as a percent of average net assets on an annualized basis) attributable to Class J shares through February 28, 2015. The limit will maintain the level of distribution fees not to exceed .24% for Class J shares. Prior to December 30, 2013, the limit was .25% (with the exception of Money Market Fund).

The Distributor has voluntarily agreed to limit Money Market Fund’s distribution fees attributable to certain share classes of Money Market Fund. The limit will maintain the level of distribution fees not to exceed .75% for Class B and 0% for Class C shares, respectively. The expense limit may be terminated at any time.

The Distributor has voluntarily agreed to limit the distribution fees attributable to Class A shares of Government & High Quality Bond Fund. The limit will maintain the level of distribution fees not to exceed .15% for Class A shares. The limit may be terminated at any time.

Amounts owed to the Funds under the terms of the expense limitation agreements are reflected in the statement of assets and liabilities as expense reimbursement from Distributor.

Sales Charges. Principal Funds Distributor, Inc., as the principal distributor, receives proceeds of any CDSC on certain Class A, Class B, Class C, and Class J share redemptions. The charge for Class A shares is 1.00% (.25% for the LargeCap S&P 500 Index Fund) of the lesser of current market value or the cost of shares redeemed within 12 months of purchase that were originally sold without a sales charge. The charge for Class B shares is based on declining rates which begin at 5.00% of the lesser of current market value or the cost of shares being redeemed within 24 months of purchase. After 24 months, the rate declines and is eliminated after 5 years. The charge for Class C shares is 1.00% of the lesser of current market value or the cost of shares redeemed within 12 months of purchase. The charge for Class J shares is 1.00% of the lesser of current market value or the cost of shares redeemed within 18 months of purchase. Principal Funds Distributor, Inc. also retains sales charges on sales of Class A shares based on declining rates which begin at 1.50% for LargeCap S&P 500 Index Fund, 2.25% for Government & High Quality Bond Fund, Income Fund and Short Term Income Fund, 3.75% for Bond & Mortgage Securities Fund, California Municipal Fund, Global Diversified Income Fund, High Yield Fund, High Yield Fund I, Inflation Protection Fund, and Tax-Exempt Bond Fund, and 5.50% for all other Funds (except Money Market Fund which does not carry a sales charge). The aggregate amounts of these charges retained by Principal Funds Distributor, Inc. for the year ended October 31, 2014, were as follows (in thousands):

Class B shares automatically convert into Class A shares, based on relative net asset value (without a sales charge), eight years after purchase.

Affiliated Ownership. At October 31, 2014, Principal Life Insurance Company (an affiliate of the Manager), the Manager, Principal Funds Distributor, Inc., Princor Financial Services Corporation, Collective Investment Trusts sponsored by Principal Trust Company, benefit plans and separate accounts sponsored on behalf of Principal Life Insurance Company, and other affiliated entities owned shares of the Funds as follows (amounts in thousands):

Affiliated Brokerage Commissions. With respect to Global Diversified Income Fund, $217,000 of brokerage commission was paid to Spectrum Asset Management, Inc., a member of the Principal Financial Group. The other Funds did not pay brokerage commissions to any member of the Principal Financial Group during the year ended October 31, 2014.

The following table reflects the conversion of Class B shares into Class A shares (reflected in the statement of changes in net assets as Class B shares and dollars redeemed and Class A dollars sold) for the year ended October 31, 2014 (amounts in thousands).

For the year ended October 31, 2014, the cost of investment securities purchased and proceeds from investment securities sold (not including short-term investments and U.S. government securities) by the Funds were as follows (amounts shown in thousands):

In addition Global Diversified Income Fund had $2,279,789,000 of covers on securities sold short and $2,224,833,000 of securities sold short.

For the year ended October 31, 2014, the cost of U.S. government securities purchased and proceeds from U.S. government securities sold (not including short-term investments) by the Funds were as follows (amounts shown in thousands):

Distributions to Shareholders. The federal income tax character of distributions paid for the years ended October 31, 2014 and October 31, 2013 were as follows (amounts in thousands):


								Long-Term
		Ordinary Income				Tax-Exempt Income*		Capital Gain^		Return of Capital
		2014		2013		2014	2013	2014	2013	2014	2013
Bond & Mortgage Securities Fund	$	73,012	$	57,577	$	— $	— $	— $	— $	— $	—
California Municipal Fund		15		329		7,608	8,742	—	—	—	—
Diversified International Fund		95,806		73,597		—	—	—	—	—	—
Equity Income Fund		120,648		131,857		—	—	—	—	—	—
Global Diversified Income Fund		363,272		347,714		—	—	—	32,733	—	—
Global Real Estate Securities Fund		69,953		86,894		—	—	22,785	—	—	—
Government & High Quality Bond Fund		51,206		56,413		—	—	—	—	230	—
High Yield Fund		266,666		274,152		—	—	58,799	6,376	—	—
High Yield Fund I		100,811		163,077		—	—	20,365	21,642	—	—
Income Fund		97,957		97,119		—	—	—	—	—	—
Inflation Protection Fund		1,736		3,836		—	—	12,742	—	—	—
International Emerging Markets Fund		14,005		21,495		—	—	—	—	—	—
International Fund I		9,947		21,369		—	—	—	—	—	—
LargeCap Growth Fund		8,173		14,845		—	—	321,833	—	—	—
LargeCap Growth Fund I		38,663		26,487		—	—	390,817	213,062	—	—
LargeCap S&P 500 Index Fund		58,505		52,369		—	—	—	—	—	—
LargeCap Value Fund		116,854		38,399		—	—	210,811	—	—	—
MidCap Fund		35,728		43,351		—	—	134,118	54,110	—	—
MidCap Value Fund III		14,298		1,226		—	—	16,382	—	—	—
Principal Capital Appreciation Fund		22,458		26,732		—	—	48,623	20,368	—	—
Real Estate Securities Fund		24,725		19,817		—	—	187,482	—	—	—
Short-Term Income Fund		32,788		23,658		—	—	979	—	—	—
SmallCap Blend Fund		3,046		1,547		—	—	32,756	2,003	—	—
SmallCap Value Fund II		6,780		14,153		—	—	98,993	—	—	—
Tax-Exempt Bond Fund		17		215		8,794	10,164	—	—	—	—

*The funds designate these distributions as exempt interest per IRC Sec. 852(b)(5).

^ The funds designate these distributions as long-term capital gain dividends per IRC Sec. 852(b)(3)(C).

For U.S. federal income tax purposes, short-term capital gain distributions are considered ordinary income distributions.

Distributable Earnings. As of October 31, 2014, the components of distributable earnings on a federal tax basis were as follows (amounts in thousands):


																	Total
		Undistributed		Undistributed		Undistributed					Net Unrealized			Other			Accumulated
		Ordinary		Tax-Exempt		Long-Term		Accumulated			Appreciation			Temporary			Earnings
		Income		Income		Capital Gains		Capital Loss			(Depreciation)			Differences*			(Deficit)
Bond & Mortgage Securities Fund	$	—	$	—	$	—	$	(124,914	)	$	28,696		$	(632	)	$	(96,850	)
California Municipal Fund		—		36		—		(44,376	)		18,643			—			(25,697	)
Diversified International Fund		70,718		—		—		(449,781	)		739,819			—			360,756
Equity Income Fund		5,370		—		—		(364,811	)		2,108,267			—			1,748,826
Global Diversified Income Fund		97,670		—		174,400		—			362,579			(1,320	)		633,329
Global Real Estate Securities Fund		35,000		—		11,716		(717	)		278,436			—			324,435
Government & High Quality Bond Fund		—		—		—		(61,888	)		8,965			—			(52,923	)
High Yield Fund		21,655		—		23,779		—			4,606			(2,359	)		47,681
High Yield Fund I		4,858		—		9,911		—			12,594			(589	)		26,774
Income Fund		1,536		—		—		(42,531	)		104,854			—			63,859
Inflation Protection Fund		17,048		—		—		(6,999	)		(19,488	)		(5,525	)		(14,964	)
International Emerging Markets Fund		27,589		—		—		(75,643	)		106,382			—			58,328
International Fund I		7,560		—		—		(294,029	)		15,293			—			(271,176	)
LargeCap Growth Fund		2,498		—		354,855		—			850,032			—			1,207,385
LargeCap Growth Fund I		80,223		—		640,757		—			2,050,166			—			2,771,146
LargeCap S&P 500 Index Fund		54,548		—		—		(56,110	)		1,613,723			—			1,612,161
LargeCap Value Fund		210,747		—		181,952		—			413,840			—			806,539
MidCap Fund		22,776		—		440,744		—			2,381,256			—			2,844,776
MidCap Value Fund III		33,697		—		43,479		—			130,704			—			207,880
Money Market Fund		—		—		—		(41,240	)		—			—			(41,240	)
Principal Capital Appreciation Fund		21,111		—		93,609		(18,208	)		1,150,276			153			1,246,941
Real Estate Securities Fund		4,917		—		20,451		—			607,529			—			632,897
Short-Term Income Fund		3,155		—		629		(19,890	)		10,874			(860	)		(6,092	)
SmallCap Blend Fund		9,560		—		48,351		(11,818	)		93,841			—			139,934
SmallCap Value Fund II		25,319		—		112,726		—			283,413			—			421,458
Tax-Exempt Bond Fund		—		169		—		(22,110	)		21,887			—			(54	)

*Represents book-to-tax accounting differences.

Distributable earnings reflect certain limitations imposed by Sections 381-384 of the Internal Revenue Code.

Capital Loss Carryforwards. Capital loss carryforwards are losses that can be used to offset future capital gains of the Funds. At October 31, 2014, the Funds had approximate net capital loss carryforwards as follows (amounts in thousands):


		Net Capital Loss Carryforward Expiring In:								No Expiration
															Annual
		2015	2016		2017		2018	2019		Short-Term		Long-Term	Total		Limitations*
Bond & Mortgage Securities Fund	$	— $	—	$	104,897	$	— $	20,017	$	—	$	—$	124,914	$	—
California Municipal Fund		280	10,723		21,987		3,189	6,663		512		1,022	44,376		—
Diversified International Fund		38,411	38,411		372,959		—	—		—		—	449,781		38,411
Equity Income Fund		—	—		358,105		—	6,706		—		—	364,811		—
Global Real Estate Securities Fund		—	—		600		117	—		—		—	717		200
Government & High Quality Bond Fund		3,147	55,497		2,385		—	—		859		—	61,888		—
Income Fund		2,035	—		18,489		8,587	13,420		—		—	42,531		—
Inflation Protection Fund		—	—		—		—	—		—		6,999	6,999		—
International Emerging Markets Fund		—	—		68,739		—	—		6,904		—	75,643		—
International Fund I		—	21,578		272,451		—	—		—		—	294,029		—
LargeCap S&P 500 Index Fund		—	56,110		—		—	—		—		—	56,110		—
Money Market Fund		2,794	35,477		2,969		—	—		—		—	41,240		5,612
Principal Capital Appreciation Fund		9,104	9,104		—		—	—		—		—	18,208		9,104
Short-Term Income Fund		—	4,342		15,548		—	—		—		—	19,890		5,314
SmallCap Blend Fund		—	11,818		—		—	—		—		—	11,818		5,909
Tax-Exempt Bond Fund		—	3,668		8,745		3,432	2,371		3,387		507	22,110		—

*In accordance with Sections 381-384 of the Internal Revenue Code, a portion of certain Fund’s losses have been subjected to an annual limitation.

Capital losses generated in taxable years beginning after the enactment date of the Regulated Investment Company Modernization Act of 2010, December 22, 2010, will be carried forward with no expiration and with the character of the loss retained. These capital losses must be fully utilized before the pre-enactment capital loss carryforwards listed in the table above.

As of October 31, 2014, the following Funds had utilized capital loss carryforwards as follows (amounts in thousands):

Late-Year Losses. A regulated investment company may elect to treat any portion of its qualified late-year loss as arising on the first day of the next taxable year. Qualified late-year losses are certain capital and ordinary losses which occur during the portion of the Fund’s taxable year subsequent to October 31 and December 31, respectively. For the taxable year ended October 31, 2014, the Funds do not intend to defer any late-year losses.

Reclassification of Capital Accounts. The Funds may record reclassifications in their capital accounts. These reclassifications have no impact on the total net assets of the Funds. The reclassifications are a result of permanent differences between GAAP and tax accounting. Adjustments are made to reflect the impact these items have on current and future distributions to shareholders. Therefore, the source of the Funds’ distributions may be shown in the accompanying Statement of Changes in Net Assets as from net investment income, from net realized gains on investments or from capital depending on the type of book and tax differences that exist. For the year ended October 31, 2014, the Funds recorded reclassifications as follows (amounts in thousands):


		Accumulated			Accumulated
		Undistributed Net			Net Realized
		Investment Income			Gain on Investments			Paid in Capital
Bond & Mortgage Securities Fund	$	2,607		$	78		$	(2,685	)
California Municipal Fund		(120	)		120			—
Diversified International Fund		10,779			(10,779	)		—
Equity Income Fund		(3,002	)		5,677			(2,675	)
Global Diversified Income Fund		21,914			(21,837	)		(77	)
Global Real Estate Securities Fund		20,663			(20,663	)		—
Government & High Quality Bond Fund		9,228			(2,991	)		(6,237	)
High Yield Fund		13,639			(13,639	)		—
High Yield Fund I		97			(97	)		—
Income Fund		4,230			(3,276	)		(954	)
Inflation Protection Fund		4,719			(4,718	)		(1	)
International Emerging Markets Fund		1,448			(1,448	)		—
International Fund I		503			(503	)		—
LargeCap Growth Fund		64			(64	)		—
LargeCap Growth Fund I		179			(179	)		—
LargeCap S&P 500 Index Fund		(86	)		86			—
LargeCap Value Fund		143			(143	)		—
MidCap Fund		17,191			(17,188	)		(3	)
MidCap Value Fund III		53			(53	)		—
Principal Capital Appreciation Fund		100			(5,889	)		5,789
Real Estate Securities Fund		2,562			(2,562	)		—
Short-Term Income Fund		(4	)		4			—
SmallCap Blend Fund		678			(678	)		—
SmallCap Value Fund II		560			(560	)		—
Tax-Exempt Bond Fund		37			(37	)		—

Federal Income Tax Basis. At October 31, 2014, the net federal income tax unrealized appreciation (depreciation) and federal tax cost of investments held by the Funds were as follows (amounts in thousands):


		Unrealized		Unrealized			Net Unrealized			Cost for Federal
		Appreciation		(Depreciation)			Appreciation (Depreciation)			Income Tax Purposes
Bond & Mortgage Securities Fund	$	51,903	$	(23,173	)	$	28,730		$	4,313,162
California Municipal Fund		18,719		(76	)		18,643			192,026
Diversified International Fund		906,885		(165,639	)		741,246			4,782,308
Equity Income Fund		2,158,282		(50,011	)		2,108,271			3,866,575
Global Diversified Income Fund		580,038		(166,865	)		413,173			9,502,971
Global Real Estate Securities Fund		305,997		(27,443	)		278,554			2,057,889
Government & High Quality Bond Fund		31,295		(22,330	)		8,965			1,661,431
High Yield Fund		113,312		(108,645	)		4,667			3,654,103
High Yield Fund I		43,445		(30,851	)		12,594			1,754,346
Income Fund		122,425		(17,571	)		104,854			2,730,741
Inflation Protection Fund		12,204		(30,985	)		(18,781	)		1,083,327
International Emerging Markets Fund		197,654		(91,063	)		106,591			1,961,855
International Fund I		25,444		(9,980	)		15,464			329,121
LargeCap Growth Fund		874,937		(24,905	)		850,032			2,519,793
LargeCap Growth Fund I		2,122,630		(72,464	)		2,050,166			5,723,499
LargeCap S&P 500 Index Fund		1,670,333		(56,610	)		1,613,723			2,635,640
LargeCap Value Fund		442,617		(28,777	)		413,840			3,337,285
MidCap Fund		2,442,536		(61,280	)		2,381,256			6,494,331
MidCap Value Fund III		152,329		(21,625	)		130,704			846,776
Money Market Fund		—		—			—			1,083,038
Principal Capital Appreciation Fund		1,166,910		(16,634	)		1,150,276			1,344,423
Real Estate Securities Fund		611,088		(3,559	)		607,529			1,436,465
Short-Term Income Fund		22,865		(11,991	)		10,874			2,516,844
SmallCap Blend Fund		111,913		(18,072	)		93,841			413,045
SmallCap Value Fund II		346,489		(63,076	)		283,413			1,281,882
Tax-Exempt Bond Fund		22,215		(328	)		21,887			191,150

9. Subsequent Events

Management has evaluated events and transactions that have occurred through the date the financial statements were issued that would merit recognition or disclosure in the financial statements. On December 9, 2014, the Board of Directors approved a plan to convert all existing Class B shares into Class A shares. Effective at the close of business on February 23, 2015, all existing Class B shares will automatically convert to Class A shares without the imposition of the applicable Class A sales load or the Class B contingent deferred sales charge. There were no other items requiring adjustment of the financial statements or additional disclosure.


COMMON STOCKS - 0.00%			Shares Held	Value (000's)					Principal
							BONDS (continued)		Amount (000's)		Value (000's)
Semiconductors - 0.00%
Tower Semiconductor Ltd - Warrants ^(a),(b),(c)			345,803		$	—	Airlines (continued)
							US Airways 2013-1 Class A Pass Through
TOTAL COMMON STOCKS				$		—	Trust
INVESTMENT COMPANIES - 3.39%			Shares Held	Value (000's)			3.95%, 11/15/2025 ^(c)	$	1,445	$	1,456
									$		11,848
Publicly Traded Investment Fund - 3.39%
Cash Account Trust - Government & Agency			133,802,219			133,802	Automobile Asset Backed Securities - 6.28%
Portfolio - DWS Government Cash							Ally Auto Receivables Trust 2013-SN1
							0.72%, 05/20/2016 ^(e)		1,919		1,920
TOTAL INVESTMENT COMPANIES				$		133,802	Ally Auto Receivables Trust 2014-2
							0.68%, 07/17/2017 ^(e)		5,000		5,004
PREFERRED STOCKS - 0.47%			Shares Held	Value (000's)
							Ally Auto Receivables Trust 2014-SN1
Banks- 0.33	%						0.36%, 10/20/2016 ^(e)		3,190		3,188
City National Corp/CA			90,000			2,508	0.52%, 10/20/2016 ^(e)		5,378		5,376
Morgan Stanley ^(a)			180,000			4,538	Ally Auto Receivables Trust 2014-SN2
State Street Corp 5.90%; Series D			225,000			5,873	1.21%, 02/20/2019 ^(e)		7,300		7,282
				$		12,919	AmeriCredit Automobile Receivables Trust
							2013-5
Diversified Financial Services - 0.03%							0.53%, 03/08/2017 ^(e)		6,147		6,151
Ally Financial Inc ^(d)			1,110			1,112
							AmeriCredit Automobile Receivables Trust
							2014-1
Electric - 0.05%							0.57%, 07/10/2017 ^(e)		2,393		2,394
SCE Trust III			75,000			2,028	AmeriCredit Automobile Receivables Trust
							2014-2
							0.43%, 10/10/2017 ^(e)		10,000		10,000
Telecommunications - 0.06%							ARI Fleet Lease Trust 2012-B

Verizon Communications Inc			95,000			2,460	0.45%,01/15/2021 (d),(e)		2,391		2,390
							Capital Auto Receivables Asset Trust / Ally
TOTAL PREFERRED STOCKS				$		18,519	0.62%, 07/20/2016		1,065		1,065
			Principal				0.79%, 06/20/2017		4,500		4,506
BONDS- 67.69	%		Amount (000's)	Value (000's)			Capital Auto Receivables Asset Trust 2013-2
Advertising - 0.07%							1.24%, 10/20/2017		6,532		6,573
CBS Outdoor Americas Capital LLC / CBS							Capital Auto Receivables Asset Trust 2014-2
Outdoor Americas Capital Corp							1.26%, 05/21/2018 ^(e)		9,500		9,538
5.25%, 02/15/2022 ^(d)		$	245		$	253	Carmax Auto Owner Trust 2013-2
WPP Finance 2010							0.42%, 06/15/2016 ^(e)		1,635		1,635
3.75%, 09/19/2024			2,535			2,523	CarMax Auto Owner Trust 2014-3
				$		2,776	0.55%, 08/15/2017		5,000		5,000
							Chesapeake Funding LLC
Aerospace & Defense - 0.02%							0.57%, 03/07/2026 ^(d),(e)		21,000		20,955
Air 2 US							0.60%, 01/07/2025 ^(d),(e)		3,558		3,553
8.03%, 10/01/2020 ^(c),(d)			291			311	1.40%, 04/07/2024 ^(d),(e)		4,726		4,759
8.63%, 10/01/2020 ^(c),(d)			301			317	Chrysler Capital Auto Receivables Trust 2014-
				$		628	B
							0.69%, 09/15/2017 ^(d),(e)		35,000		35,028
Agriculture - 0.46%
Altria Group Inc							Ford Credit Auto Lease Trust 2012-B
							0.57%, 09/15/2015 ^(e)		111		111
2.85%, 08/09/2022			960			930
5.38%, 01/31/2044			5,571			6,099	GM Financial Automobile Leasing Trust
9.95%, 11/10/2038			915			1,535	2014-1
							1.76%, 05/21/2018 ^(d)		5,110		5,142
Philip Morris International Inc							1.99%, 05/21/2018 ^(d)		2,000		2,002
4.38%, 11/15/2041			1,355			1,363
6.38%, 05/16/2038			30			38	GM Financial Automobile Leasing Trust
Pinnacle Operating Corp							2014-2
9.00%, 11/15/2020 ^(d)			1,615			1,740	1.96%, 03/20/2018 ^(d)		1,500		1,506
							2.43%, 03/20/2018 ^(d)		4,250		4,266
Reynolds American Inc
3.25%, 11/01/2022			3,895			3,804	Hertz Fleet Lease Funding LP
							0.55%, 04/10/2028 ^(d),(e)		7,200		7,203
4.85%, 09/15/2023			2,370			2,556	0.70%, 12/10/2027 ^(d),(e)		11,685		11,703
				$		18,065
							Mercedes Benz Auto Lease Trust 2013-B
Airlines - 0.30%							0.62%, 07/15/2016		12,900		12,909
American Airlines 2013-2 Class A Pass							Santander Drive Auto Receivables Trust 2014-
Through Trust							2
4.95%, 07/15/2024 ^(c)			2,185			2,333	0.47%, 07/17/2017 ^(e)		13,575		13,569
American Airlines 2014-1 Class A Pass							0.80%, 04/16/2018 ^(e)		8,175		8,177
Through Trust							Santander Drive Auto Receivables Trust 2014-
3.70%, 10/01/2026 ^(c)			1,565			1,559	4
United Airlines 2014-1 Class A Pass Through							0.47%, 01/16/2018 ^(e)		17,350		17,354
Trust							World Omni Auto Receivables Trust 2014-A
4.00%, 04/11/2026 ^(c)			3,710			3,756	0.94%, 04/15/2019 ^(e)		10,725		10,713
United Airlines 2014-2 Class A Pass Through							World Omni Auto Receivables Trust 2014-B
Trust							1.14%, 01/15/2020		9,700		9,668
3.75%, 09/03/2026 ^(c)			2,430			2,460	World Omni Automobile Lease Securitization
US Airways 2001-1G Pass Through Trust							Trust 2013-A
7.08%, 09/20/2022 ^(c)			258			284	0.73%, 05/16/2016		1,058		1,059


Schedule of Investments
Bond & Mortgage Securities Fund
October 31, 2014



				Principal					Principal
	BONDS (continued)			Amount (000's)		Value (000's)	BONDS (continued)		Amount (000's)		Value (000's)

	Automobile Asset Backed Securities (continued)						Banks (continued)
	World Omni Automobile Lease Securitization						Bancolombia SA
	Trust 2013-A (continued)						5.95%, 06/03/2021	$	1,585	$	1,757
	1.10%, 12/15/2016		$	6,150	$	6,179	Bank of America Corp
				$		247,878	4.00%, 04/01/2024		2,075		2,144
							4.10%, 07/24/2023		2,845		2,970
	Automobile Floor Plan Asset Backed Securities - 1.53%						4.13%, 01/22/2024		3,770		3,921
	Ally Master Owner Trust						4.20%, 08/26/2024		15,830		15,943
	0.60%, 04/15/2018 ^(e)			8,000		8,012
							4.25%, 10/22/2026		6,100		6,055
	1.21%, 06/15/2017			10,650		10,696	4.88%, 04/01/2044		955		1,023
	BMW Floorplan Master Owner Trust						6.25%, 09/29/2049 ^(e)		5,010		5,004
	0.55%, 09/15/2017 ^(d),(e)			20,262		20,294
							Barclays PLC
	Ford Credit Auto Owner Trust 2014-Rev2						8.25%, 12/29/2049 ^(e)		3,200		3,304
	2.31%, 04/15/2026 ^(d),(e)			5,000		5,012
							BBVA Banco Continental SA
	GE Dealer Floorplan Master Note Trust						5.00%, 08/26/2022 ^(d)		1,100		1,159
	0.60%, 10/20/2017 ^(e)			9,050		9,060
							BBVA Bancomer SA/Texas
	Nissan Master Owner Trust Receivables						6.75%, 09/30/2022 ^(d)		4,115		4,660
	0.62%, 05/15/2017 ^(e)			4,592		4,597
							BBVA US Senior SAU
	World Omni Master Owner Trust						4.66%, 10/09/2015		1,465		1,518
	0.50%, 02/15/2018 ^(d),(e)			2,758		2,760
							BNZ International Funding Ltd/London
				$		60,431	2.35%, 03/04/2019 ^(d)		1,900		1,902
	Automobile Manufacturers - 1.20%						BPCE SA
	Chrysler Group LLC / CG Co-Issuer Inc						1.61%, 07/25/2017		1,140		1,145
	8.00%, 06/15/2019			1,145		1,227	4.50%, 03/15/2025 ^(d)		18,005		17,489
	Daimler Finance North America LLC						4.63%, 07/11/2024 ^(d)		12,680		12,509
	1.25%, 01/11/2016 ^(d)			2,120		2,131	5.15%, 07/21/2024 ^(d)		4,325		4,451
	1.30%, 07/31/2015 ^(d)			3,205		3,223	5.70%, 10/22/2023 ^(d)		4,305		4,623
	1.45%, 08/01/2016 ^(d)			2,005		2,018	Capital One NA/Mclean VA
	2.38%, 08/01/2018 ^(d)			3,785		3,836	2.40%, 09/05/2019		2,345		2,331
	Ford Motor Co						CIT Group Inc
	7.40%, 11/01/2046			1,130		1,563	3.88%, 02/19/2019		2,445		2,460
	General Motors Co						4.75%, 02/15/2015 ^(d)		300		302
	3.50%, 10/02/2018			14,995		15,445	Citigroup Inc
	6.25%, 10/02/2043			1,275		1,517	5.80%, 11/15/2049 ^(e)		8,340		8,357
	Jaguar Land Rover Automotive PLC						City National Corp/CA
	4.13%, 12/15/2018 ^(d)			540		549	5.25%, 09/15/2020		3,100		3,453
	5.63%, 02/01/2023 ^(d)			3,065		3,188	Compass Bank
	8.13%, 05/15/2021 ^(d)			390		429	1.85%, 09/29/2017		4,500		4,518
	Navistar International Corp						2.75%, 09/29/2019		6,000		6,044
	8.25%, 11/01/2021			2,075		2,133	Cooperatieve Centrale Raiffeisen-
	Nissan Motor Acceptance Corp						Boerenleenbank BA/Netherlands
	0.78%, 03/03/2017 ^(d),(e)			3,000		3,006	4.63%, 12/01/2023		11,465		12,050
	Toyota Motor Credit Corp						8.40%, 11/29/2049 ^(e)		5,360		5,896
	0.62%, 01/17/2019 ^(e)			1,320		1,326	11.00%, 12/29/2049 ^(d),(e)		1,560		2,036
	2.10%, 01/17/2019			910		916	Credit Agricole SA
	Volkswagen Group of America Finance LLC						6.63%, 09/29/2049 ^(d),(e)		4,620		4,507
	2.13%, 05/23/2019 ^(d)			3,190		3,173	6.64%, 05/29/2049 ^(d),(e)		150		159
	Volkswagen International Finance NV						Credit Suisse Group AG
	1.13%, 11/18/2016 ^(d)			1,625		1,628	6.25%, 12/29/2049 ^(d),(e)		3,390		3,297
				$		47,308	Fifth Third Bank/Cincinnati OH
							2.88%, 10/01/2021		3,125		3,103
	Automobile Parts & Equipment - 0.02%						Goldman Sachs Group Inc/The
	Dana Holding Corp						2.55%, 10/23/2019		5,395		5,360
	5.38%, 09/15/2021			195		203	3.85%, 07/08/2024		5,015		5,066
	6.00%, 09/15/2023			395		415	5.38%, 03/15/2020		2,415		2,708
	Gestamp Funding Luxembourg SA						6.75%, 10/01/2037		5,850		7,172
	5.63%, 05/31/2020 ^(d)			200		200	Huntington National Bank/The
				$		818	0.66%, 04/24/2017 ^(e)		12,100		12,102
	Banks- 9.47	%					ING Bank NV
							0.93%, 10/01/2019 ^(d),(e)		3,000		3,004
	Abbey National Treasury Services						2.50%, 10/01/2019 ^(d)		3,250		3,270
	PLC/London						4.12%, 11/21/2023 ^(e)		4,500		4,610
	0.64%, 09/29/2017 ^(e)			7,000		7,000
							5.80%, 09/25/2023 ^(d)		6,130		6,822
	Associated Banc-Corp
	5.13%, 03/28/2016			5,055		5,324	Intesa Sanpaolo SpA
	Banco de Credito e Inversiones						2.38%, 01/13/2017		7,815		7,902
	4.00%, 02/11/2023 ^(d)			600		592	3.13%, 01/15/2016		3,070		3,135
							5.02%, 06/26/2024 ^(d)		16,210		15,842
	Banco Inbursa SA Institucion de Banca
	Multiple						JP Morgan Chase & Co
	4.13%, 06/06/2024 ^(d)			2,100		2,058	3.20%, 01/25/2023		24,510		24,317
	Banco Santander Mexico SA Institucion de						4.85%, 02/01/2044		1,070		1,151
							5.00%, 12/29/2049 ^(e)		5,585		5,494
	Banca Multiple Grupo Financiero Santander
	4.13%, 11/09/2022 ^(d)			1,100		1,114	JP Morgan Chase Capital XIII
							1.18%, 09/30/2034 ^(e)		300		262


Schedule of Investments
Bond & Mortgage Securities Fund
October 31, 2014



		Principal					Principal
BONDS (continued)		Amount (000's)		Value (000's)	BONDS (continued)		Amount (000's)		Value (000's)

Banks (continued)					Biotechnology (continued)
Lloyds Bank PLC					Gilead Sciences Inc
2.30%, 11/27/2018	$	2,130	$	2,144	3.05%, 12/01/2016	$	840	$	875
Mitsubishi UFJ Trust & Banking Corp					4.80%, 04/01/2044		4,745		5,143
2.45%, 10/16/2019 ^(d)		5,355		5,343			$		18,878
Morgan Stanley
0.97%, 07/23/2019 ^(e)		1,945		1,939	Building Materials - 0.69%
1.75%, 02/25/2016		8,610		8,687	Ainsworth Lumber Co Ltd
					7.50%, 12/15/2017 ^(d)		235		243
2.38%, 07/23/2019		9,470		9,401
3.70%, 10/23/2024		7,675		7,659	Boise Cascade Co
4.35%, 09/08/2026		3,625		3,635	6.38%, 11/01/2020		390		407
5.00%, 11/24/2025		10,420		11,075	Cemex SAB de CV
					7.25%, 01/15/2021 ^(d)		5,385		5,809
5.45%, 07/29/2049 ^(e)		6,690		6,721
Nordea Bank AB					CRH America Inc
5.50%, 09/29/2049 ^(d),(e)		2,230		2,252	4.13%, 01/15/2016		1,630		1,690
6.13%, 12/29/2049 ^(d),(e)		2,100		2,104	6.00%, 09/30/2016		1,935		2,107
PNC Bank NA					8.13%, 07/15/2018		3,425		4,122
6.00%, 12/07/2017		7,400		8,341	Martin Marietta Materials Inc
					1.33%, 06/30/2017 ^(d),(e)		9,280		9,319
RBS Capital Trust III					4.25%, 07/02/2024 ^(d)		2,830		2,885
5.51%, 09/29/2049		911		893
Royal Bank of Scotland Group PLC					Norbord Inc
					5.38%, 12/01/2020 ^(d)		650		639
5.13%, 05/28/2024		410		415
7.64%, 03/29/2049 ^(e)		390		413			$		27,221
UBS AG/Jersey					Chemicals - 0.58%
7.25%, 02/22/2022 ^(e)		4,840		5,235	Axiall Corp
UBS AG/Stamford CT					4.88%, 05/15/2023		1,700		1,649
1.38%, 08/14/2017		4,960		4,943	CF Industries Inc
Wells Fargo & Co					5.15%, 03/15/2034		1,595		1,698
5.90%, 12/29/2049 ^(e)		10,405		10,697	Cornerstone Chemical Co
Westpac Banking Corp					9.38%, 03/15/2018 ^(d)		720		718
0.56%, 05/19/2017 ^(e)		7,850		7,848	Dow Chemical Co/The
Zions Bancorporation					4.38%, 11/15/2042		515		487
6.00%, 09/15/2015		1		1	Eagle Spinco Inc
		$		374,141	4.63%, 02/15/2021		2,280		2,212
Beverages - 0.65%					INEOS Group Holdings SA
					6.13%, 08/15/2018 ^(d)		200		202
Ajecorp BV
6.50%, 05/14/2022		1,100		1,012	LYB International Finance BV
Anheuser-Busch Cos LLC					4.88%, 03/15/2044		780		807
5.60%, 03/01/2017		1,090		1,196	Mexichem SAB de CV
					4.88%, 09/19/2022 ^(d)		2,000		2,132
Anheuser-Busch InBev Worldwide Inc
1.38%, 07/15/2017		1,345		1,348	4.88%, 09/19/2022		1,000		1,066
2.50%, 07/15/2022		4,755		4,550	Monsanto Co
7.75%, 01/15/2019		1,030		1,249	4.20%, 07/15/2034		5,335		5,448
Coca-Cola Icecek AS					Mosaic Co/The
4.75%, 10/01/2018 ^(d)		2,050		2,181	5.45%, 11/15/2033		2,500		2,791
Constellation Brands Inc					NOVA Chemicals Corp
					5.00%, 05/01/2025 ^(d)		835		862
3.75%, 05/01/2021		2,315		2,318	5.25%, 08/01/2023 ^(d)		1,205		1,259
3.88%, 11/15/2019 ^(f)		210		213
4.25%, 05/01/2023		1,855		1,864	Taminco Global Chemical Corp
					9.75%, 03/31/2020 ^(d)		1,240		1,364
Corp Lindley SA
6.75%, 11/23/2021 ^(d)		700		765			$		22,695
6.75%, 11/23/2021		865		945	Commercial Services - 0.22%
Pernod Ricard SA					DP World Ltd
4.45%, 01/15/2022 ^(d)		4,695		4,988	6.85%, 07/02/2037		500		574
5.75%, 04/07/2021 ^(d)		1,045		1,196	ERAC USA Finance LLC
SABMiller Holdings Inc					2.75%, 03/15/2017 ^(d)		1,015		1,047
3.75%, 01/15/2022 ^(d)		1,760		1,818	3.30%, 10/15/2022 ^(d)		345		344
		$		25,643	3.85%, 11/15/2024 ^(d)		1,700		1,719
Biotechnology - 0.48%					Moody's Corp
Amgen Inc					5.25%, 07/15/2044		4,010		4,324
5.15%, 11/15/2041		425		456	TMS International Corp
					7.63%, 10/15/2021 ^(d)		450		470
Celgene Corp
1.90%, 08/15/2017		1,195		1,206	United Rentals North America Inc
3.25%, 08/15/2022		4,935		4,950	5.75%, 07/15/2018		100		105
4.00%, 08/15/2023		185		193			$		8,583
4.63%, 05/15/2044		4,915		5,013	Computers - 1.02%
5.25%, 08/15/2043		115		127	Apple Inc
Genzyme Corp					0.49%, 05/03/2018 ^(e)		5,473		5,481
5.00%, 06/15/2020		810		915	0.54%, 05/06/2019 ^(e)		7,380		7,386
					3.85%, 05/04/2043		2,895		2,764
					Compiler Finance Sub Inc
					7.00%, 05/01/2021 ^(d)		515		471


Schedule of Investments
Bond & Mortgage Securities Fund
October 31, 2014



	Principal						Principal
BONDS (continued)	Amount (000's)			Value (000's)	BONDS (continued)		Amount (000's)	Value (000's)

Computers (continued)					Diversified Financial Services (continued)
Dell Inc					Ford Motor Credit Co LLC	(continued)
5.65%, 04/15/2018	$	365	$	388	8.00%, 12/15/2016	$	11,315	$	12,823
Hewlett-Packard Co					General Electric Capital Corp
3.00%, 09/15/2016		425		439	0.51%, 05/15/2017 ^(e)		7,850		7,854
4.30%, 06/01/2021		2,720		2,852	5.25%, 06/29/2049 ^(e)		2,690		2,697
iGATE Corp					5.30%, 02/11/2021		16,500		18,738
4.75%, 04/15/2019		155		155	6.25%, 12/31/2049 ^(e)		3,800		4,156
IHS Inc					General Motors Financial Co Inc
5.00%, 11/01/2022 ^(d)		285		289	2.63%, 07/10/2017		2,805		2,844
International Business Machines Corp					2.75%, 05/15/2016		1,425		1,445
0.61%, 02/12/2019 ^(e)		7,100		7,139	3.25%, 05/15/2018		860		879
3.63%, 02/12/2024		2,370		2,420	HSBC Finance Capital Trust IX
NCR Corp					5.91%, 11/30/2035		2,800		2,863
4.63%, 02/15/2021		2,612		2,599	Icahn Enterprises LP / Icahn Enterprises
5.88%, 12/15/2021		875		897	Finance Corp
Seagate HDD Cayman					3.50%, 03/15/2017		1,665		1,657
4.75%, 06/01/2023		1,725		1,780	4.88%, 03/15/2019		540		549
4.75%, 01/01/2025 ^(d)		3,395		3,433	6.00%, 08/01/2020		725		761
Xerox Business Services LLC					ILFC E-Capital Trust II
5.20%, 06/01/2015		1,850		1,896	6.25%, 12/21/2065 ^(d),(e)		155		150
		$		40,389	International Lease Finance Corp
					2.18%, 06/15/2016 ^(e)		30		30
Credit Card Asset Backed Securities - 2.65%					6.25%, 05/15/2019		2,105		2,302
BA Credit Card Trust					8.62%, 09/15/2015 ^(e)		970		1,019
0.42%, 09/16/2019 ^(e)		4,800		4,799
0.44%, 01/15/2020 ^(e)		5,115		5,115	National Rural Utilities Cooperative Finance
					Corp
Barclays Dryrock Issuance Trust					0.49%, 05/12/2017 ^(e)		5,500		5,497
0.49%, 07/16/2018 ^(e)		18,755		18,770
					4.75%, 04/30/2043 ^(e)		855		847
0.49%, 03/16/2020 ^(e)		12,300		12,306
0.51%, 12/16/2019 ^(e)		4,000		4,004	Springleaf Finance Corp
					6.90%, 12/15/2017		135		147
Chase Issuance Trust							$		105,074
0.25%, 05/15/2017 ^(e)		9,500		9,500
0.28%, 08/15/2017 ^(e)		6,200		6,195	Electric - 2.14%
0.30%, 10/16/2017 ^(e)		650		650	Abu Dhabi National Energy Co
0.36%, 04/16/2018 ^(e)		15,000		14,989	3.63%, 01/12/2023 ^(d)		200		201
Citibank Credit Card Issuance Trust					Alabama Power Co
0.35%, 08/24/2018 ^(e)		6,625		6,626	3.85%, 12/01/2042		850		824
0.62%, 03/24/2017 ^(e)		10,000		9,998	4.15%, 08/15/2044		2,155		2,192
Synchrony Credit Card Master Note Trust					CMS Energy Corp
0.45%, 06/15/2018 ^(e)		11,750		11,749	4.70%, 03/31/2043		910		932
		$		104,701	Commonwealth Edison Co
					3.80%, 10/01/2042		2,170		2,087
Distribution & Wholesale - 0.03%					4.60%, 08/15/2043		1,380		1,484
HD Supply Inc					Dominion Gas Holdings LLC
7.50%, 07/15/2020		725		772	4.80%, 11/01/2043		75		81
11.00%, 04/15/2020		490		562	DTE Electric Co
		$		1,334	3.38%, 03/01/2025		3,090		3,151
Diversified Financial Services - 2.66%					DTE Energy Co
Air Lease Corp					6.38%, 04/15/2033		3,980		5,077
2.13%, 01/15/2018		6,340		6,269	Duke Energy Carolinas LLC
Aircastle Ltd					4.00%, 09/30/2042		1,865		1,874
4.63%, 12/15/2018		380		386	Duke Energy Corp
5.13%, 03/15/2021		2,340		2,369	3.75%, 04/15/2024		1,500		1,557
7.63%, 04/15/2020		240		270	Duke Energy Progress Inc
Ally Financial Inc					4.38%, 03/30/2044		1,375		1,468
4.75%, 09/10/2018		220		231	Dynegy Finance I Inc / Dynegy Finance II
American Express Credit Corp					Inc
0.72%, 08/15/2019 ^(e)		3,000		2,992	6.75%, 11/01/2019 ^(d)		790		818
1.55%, 09/22/2017		2,995		3,004	7.38%, 11/01/2022 ^(d)		1,385		1,465
Consolidated Energy Finance SA					7.63%, 11/01/2024 ^(d)		350		371
6.75%, 10/15/2019 ^(d)		2,200		2,244	Edison International
Countrywide Financial Corp					3.75%, 09/15/2017		1,420		1,504
6.25%, 05/15/2016		5,290		5,683	Electricite de France SA
Credit Acceptance Corp					2.15%, 01/22/2019 ^(d)		1,000		1,000
6.13%, 02/15/2021 ^(d)		3,010		3,115	4.88%, 01/22/2044 ^(d)		1,140		1,214
Denali Borrower LLC / Denali Finance Corp					5.63%, 12/29/2049 ^(d),(e)		6,490		6,879
5.63%, 10/15/2020 ^(d)		2,410		2,556	Elwood Energy LLC
Fly Leasing Ltd					8.16%, 07/05/2026		695		775
6.38%, 10/15/2021		1,500		1,493	Energy Future Intermediate Holding Co LLC /
Ford Motor Credit Co LLC					EFIH Finance Inc
2.60%, 11/04/2019 ^(f)		4,860		4,844	0.00%, 03/01/2022 ^(a),(d),(e)		450		536
4.38%, 08/06/2023		2,225		2,360	FirstEnergy Corp
					7.38%, 11/15/2031		1,730		2,056


Schedule of Investments
Bond & Mortgage Securities Fund
October 31, 2014



		Principal						Principal
BONDS (continued)		Amount (000's)		Value (000's)	BONDS (continued)			Amount (000's)		Value (000's)

Electric (continued)					Engineering & Construction (continued)
Florida Power & Light Co					Odebrecht Offshore Drilling Finance
4.05%, 06/01/2042	$	1,260	$	1,283	Ltd (continued)
4.13%, 02/01/2042		755		778	6.75%, 10/01/2022 ^(d)		$	1,526	$	1,599
Indiantown Cogeneration LP					SBA Tower Trust
9.77%, 12/15/2020		1,130		1,282	2.90%, 10/15/2044 ^(d)			2,700		2,707
Miran Mid-Atlantic Series C Pass Through								$		7,780
Trust
10.06%, 12/30/2028		2,197		2,395	Entertainment - 0.25%
Mirant Mid-Atlantic Series B Pass Through					CCM Merger Inc
					9.13%, 05/01/2019 ^(d)			2,330		2,505
Trust
9.13%, 06/30/2017 ^(c)		50		54	Cinemark USA Inc
Northern States Power Co/MN					4.88%, 06/01/2023			2,815		2,773
3.40%, 08/15/2042		265		241	DreamWorks Animation SKG Inc
					6.88%, 08/15/2020 ^(d)			1,695		1,771
NRG Energy Inc
6.25%, 05/01/2024 ^(d)		835		862	Lions Gate Entertainment Corp
8.25%, 09/01/2020		820		887	5.25%, 08/01/2018			125		129
Oncor Electric Delivery Co LLC					Peninsula Gaming LLC / Peninsula Gaming
2.15%, 06/01/2019 ^(d)		6,750		6,739	Corp
					8.38%, 02/15/2018 ^(d)			1,200		1,266
5.25%, 09/30/2040		950		1,118
Pacific Gas & Electric Co					Regal Entertainment Group
4.45%, 04/15/2042		645		661	5.75%, 03/15/2022			590		577
PacifiCorp					WMG Acquisition Corp
					6.00%, 01/15/2021 ^(d)			126		129
3.85%, 06/15/2021		1,137		1,231
4.10%, 02/01/2042		1,675		1,705	WMG Holdings Corp
Perusahaan Listrik Negara PT					13.75%, 10/01/2019			755		868
5.50%, 11/22/2021 ^(d)		650		691				$		10,018
PPL Electric Utilities Corp					Environmental Control - 0.08%
3.00%, 09/15/2021		465		475	Republic Services Inc
4.75%, 07/15/2043		1,435		1,586	3.80%, 05/15/2018			1,215		1,292
PPL WEM Holdings Ltd					Waste Management Inc
3.90%, 05/01/2016 ^(d)		2,470		2,565	7.75%, 05/15/2032			1,200		1,738
5.38%, 05/01/2021 ^(d)		950		1,072
								$		3,030
Public Service Co of Colorado
4.30%, 03/15/2044		560		588	Food- 1.12	%
4.75%, 08/15/2041		1,400		1,569	ConAgra Foods Inc
Public Service Electric & Gas Co					1.30%, 01/25/2016			375		376
2.30%, 09/15/2018		2,700		2,760	Grupo Bimbo SAB de CV
3.65%, 09/01/2042		365		346	3.88%, 06/27/2024 ^(d)			5,480		5,454
Puget Energy Inc					4.88%, 06/27/2044 ^(d)			550		539
5.63%, 07/15/2022		400		462	Ingles Markets Inc
6.00%, 09/01/2021		2,935		3,408	5.75%, 06/15/2023			805		821
San Diego Gas & Electric Co					Kraft Foods Group Inc
4.30%, 04/01/2042		230		242	1.63%, 06/04/2015			590		594
Southern California Edison Co					6.50%, 02/09/2040			1,450		1,801
3.90%, 12/01/2041		390		383	Kroger Co/The
4.05%, 03/15/2042		1,610		1,609	5.00%, 04/15/2042			670		712
Virginia Electric and Power Co					Mondelez International Inc
4.00%, 01/15/2043		245		242	6.50%, 11/01/2031			430		547
4.45%, 02/15/2044		3,450		3,645	Smithfield Foods Inc
4.65%, 08/15/2043		1,620		1,768	5.25%, 08/01/2018 ^(d)			250		257
Wisconsin Power & Light Co					5.88%, 08/01/2021 ^(d)			395		419
4.10%, 10/15/2044		4,175		4,185	Sysco Corp
		$		84,378	1.45%, 10/02/2017			370		372
					2.35%, 10/02/2019			4,445		4,471
Electronics - 0.22%					3.00%, 10/02/2021			5,895		5,978
Keysight Technologies Inc					3.50%, 10/02/2024			2,340		2,375
3.30%, 10/30/2019 ^(d)		4,300		4,302	4.35%, 10/02/2034			5,465		5,613
4.55%, 10/30/2024 ^(d)		2,790		2,789	4.50%, 10/02/2044			325		333
Sanmina Corp					Tyson Foods Inc
4.38%, 06/01/2019 ^(d)		105		105	2.65%, 08/15/2019			915		924
Thermo Fisher Scientific Inc					3.95%, 08/15/2024			6,545		6,675
5.30%, 02/01/2044		405		456	4.88%, 08/15/2034			875		917
Viasystems Inc					5.15%, 08/15/2044			395		422
7.88%, 05/01/2019 ^(d)		1,050		1,113	Wm Wrigley Jr Co
		$		8,765	2.40%, 10/21/2018 ^(d)			1,650		1,667
					3.38%, 10/21/2020 ^(d)			2,745		2,804
Engineering & Construction - 0.20%
Aguila 3 SA								$		44,071
7.88%, 01/31/2018 ^(d)		390		391	Forest Products & Paper - 0.49%
Odebrecht Finance Ltd					Cascades Inc
5.13%, 06/26/2022 ^(d)		2,200		2,279	5.50%, 07/15/2022 ^(d)			560		553
Odebrecht Offshore Drilling Finance Ltd					Domtar Corp
6.63%, 10/01/2022 ^(d)		781		804	6.25%, 09/01/2042			2,155		2,254


Schedule of Investments
Bond & Mortgage Securities Fund
October 31, 2014



				Principal					Principal
	BONDS (continued)			Amount (000's)		Value (000's)	BONDS (continued)		Amount (000's)		Value (000's)

	Forest Products & Paper (continued)						Holding Companies - Diversified (continued)
	Domtar Corp (continued)						Nielsen Co Luxembourg SARL/The
	6.75%, 02/15/2044		$	1,905	$	2,083	5.50%, 10/01/2021 ^(d)	$	770	$	799
	Georgia-Pacific LLC						Tenedora Nemak SA de CV
	5.40%, 11/01/2020 ^(d)			2,870		3,279	5.50%, 02/28/2023 ^(d)		2,300		2,391
	International Paper Co								$		7,197
	4.80%, 06/15/2044			2,220		2,185
	Klabin Finance SA						Home Builders - 0.23%
	5.25%, 07/16/2024 ^(d)			1,600		1,567	Beazer Homes USA Inc
	Resolute Forest Products Inc						6.63%, 04/15/2018		685		714
	5.88%, 05/15/2023			1,445		1,384	KB Home
	Sappi Papier Holding GmbH						4.75%, 05/15/2019		390		387
	7.50%, 06/15/2032 ^(d)			1,860		1,739	Lennar Corp
	8.38%, 06/15/2019 ^(d)			3,250		3,526	4.13%, 12/01/2018		1,725		1,749
							4.75%, 11/15/2022 ^(e)		2,660		2,620
	Tembec Industries Inc
	9.00%, 12/15/2019 ^(d)			805		815	MDC Holdings Inc
				$		19,385	6.00%, 01/15/2043		485		419
							WCI Communities Inc
	Gas- 0.05	%					6.88%, 08/15/2021		1,390		1,404
	Nakilat Inc						6.88%, 08/15/2021 ^(d)		215		217
	6.07%, 12/31/2033			200		227	Woodside Homes Co LLC / Woodside Homes
	Sempra Energy						Finance Inc
	2.88%, 10/01/2022			300		294	6.75%, 12/15/2021 ^(d)		1,725		1,734
	Talent Yield Investments Ltd								$		9,244
	4.50%, 04/25/2022 ^(d)			1,500		1,561
				$		2,082	Home Equity Asset Backed Securities - 0.04%
							First NLC Trust 2005-1
	Healthcare - Products - 0.08%						0.65%, 05/25/2035 ^(e)		343		236
	ConvaTec Finance International SA						JP Morgan Mortgage Acquisition Trust 2006-
	8.25%, PIK 9.00%, 01/15/2019 ^(d),(g)			1,750		1,787	CW2
	ConvaTec Healthcare E SA						0.30%, 08/25/2036 ^(e)		947		888
	10.50%, 12/15/2018 ^(d)			400		424	New Century Home Equity Loan Trust 2005-
	Kinetic Concepts Inc / KCI USA Inc						1
	10.50%, 11/01/2018			505		557	0.73%, 03/25/2035 ^(e)		85		85
	Universal Hospital Services Inc						Saxon Asset Securities Trust 2004-1
	7.63%, 08/15/2020			205		191	1.85%, 03/25/2035 ^(e)		282		145
				$		2,959	Specialty Underwriting & Residential Finance
							Trust Series 2004-BC1
	Healthcare - Services - 0.83%						0.92%, 02/25/2035 ^(e)		303		286
	Centene Corp								$		1,640
	4.75%, 05/15/2022			6,605		6,679
	5.75%, 06/01/2017			5,385		5,668	Insurance - 1.80%
	CHS/Community Health Systems Inc						AIG Life Holdings Inc
	5.13%, 08/01/2021			95		99	7.57%, 12/01/2045 ^(d)		100		132
	Fresenius Medical Care US Finance II Inc						American International Group Inc
	4.75%, 10/15/2024 ^(d)			680		682	3.38%, 08/15/2020		6,910		7,170
	5.88%, 01/31/2022 ^(d)			985		1,074	4.50%, 07/16/2044		7,780		7,901
	Fresenius Medical Care US Finance Inc						Five Corners Funding Trust
	6.50%, 09/15/2018 ^(d)			330		365	4.42%, 11/15/2023 ^(d)		5,970		6,306
	HCA Holdings Inc						Liberty Mutual Group Inc
	6.25%, 02/15/2021			925		996	4.25%, 06/15/2023 ^(d)		2,270		2,348
	HCA Inc						5.00%, 06/01/2021 ^(d)		2,500		2,744
	4.75%, 05/01/2023			2,685		2,729	7.00%, 03/07/2067 ^(d),(e)		2,260		2,350
	5.00%, 03/15/2024			670		691	7.80%, 03/07/2087 ^(d)		2,795		3,270
	5.25%, 04/15/2025			1,945		2,015	MetLife Capital Trust IV
	5.88%, 03/15/2022			580		637	7.88%, 12/15/2067 ^(d)		1,770		2,261
	7.25%, 09/15/2020			690		731	MetLife Inc
	LifePoint Hospitals Inc						4.88%, 11/13/2043		2,590		2,810
	5.50%, 12/01/2021 ^(d)			610		639	Metropolitan Life Global Funding I
	MPH Acquisition Holdings LLC						1.30%, 04/10/2017 ^(d)		1,370		1,373
	6.63%, 04/01/2022 ^(d)			2,390		2,501	Pricoa Global Funding I
	Roche Holdings Inc						2.20%, 05/16/2019 ^(b),(d)		3,170		3,149
	6.00%, 03/01/2019 ^(d)			1,154		1,333	Teachers Insurance & Annuity Association of
	Ventas Realty LP						America
	1.25%, 04/17/2017			790		789	4.90%, 09/15/2044 ^(d)		5,350		5,672
	WellCare Health Plans Inc						TIAA Asset Management Finance Co LLC
	5.75%, 11/15/2020			4,975		5,123	2.95%, 11/01/2019 ^(d)		6,675		6,688
				$		32,751	4.13%, 11/01/2024 ^(d)		3,030		3,046
							Voya Financial Inc
	Holding Companies - Diversified - 0.18%						2.90%, 02/15/2018		3,800		3,907
	Alfa SAB de CV						5.65%, 05/15/2053 ^(e)		8,965		8,965
	5.25%, 03/25/2024 ^(d)			2,950		3,212
							XL Group PLC
	Alphabet Holding Co Inc						6.50%, 12/31/2049 ^(e)		1,140		1,094
	7.75%, 11/01/2017			820		795			$		71,186


Schedule of Investments
Bond & Mortgage Securities Fund
October 31, 2014



			Principal						Principal
	BONDS (continued)		Amount (000's)			Value (000's)	BONDS (continued)		Amount (000's)		Value (000's)

	Internet - 0.09%						Media (continued)
	Equinix Inc						DIRECTV Holdings LLC / DIRECTV
	4.88%, 04/01/2020		$	230	$	235	Financing Co Inc
	5.38%, 04/01/2023			730		753	4.45%, 04/01/2024	$	8,870	$	9,254
	Zayo Group LLC / Zayo Capital Inc						5.00%, 03/01/2021		330		363
	8.13%, 01/01/2020			400		427	6.00%, 08/15/2040		790		887
	10.13%, 07/01/2020			1,995		2,215	6.38%, 03/01/2041		2,225		2,601
				$		3,630	DISH DBS Corp
							4.25%, 04/01/2018		920		943
	Iron & Steel - 0.52%						5.88%, 07/15/2022		1,890		2,003
	ArcelorMittal						6.75%, 06/01/2021		4,605		5,112
	6.00%, 03/01/2021 ^(e)			1,540		1,652
							7.88%, 09/01/2019		1,517		1,762
	6.13%, 06/01/2018			345		369	Globo Comunicacao e Participacoes SA
	7.50%, 10/15/2039			2,165		2,311	4.88%, 04/11/2022 ^(d)		800		822
	Commercial Metals Co						NBCUniversal Enterprise Inc
	4.88%, 05/15/2023			2,785		2,715	0.92%, 04/15/2018 ^(d),(e)		5,490		5,542
	7.35%, 08/15/2018			175		194	NBCUniversal Media LLC
	Glencore Funding LLC						4.45%, 01/15/2043		1		1
	3.13%, 04/29/2019 ^(d)			6,895		6,961
							5.15%, 04/30/2020		1,733		1,972
	Samarco Mineracao SA						Numericable Group SA
	4.13%, 11/01/2022 ^(d)			1,900		1,807
							6.00%, 05/15/2022 ^(d)		835		854
	5.38%, 09/26/2024 ^(d)			2,500		2,505
							RCN Telecom Services LLC / RCN Capital
	Signode Industrial Group Lux SA/Signode						Corp
	Industrial Group US Inc						8.50%, 08/15/2020 ^(d)		995		1,042
	6.38%, 05/01/2022 ^(d)			1,975		1,916
							Time Warner Cable Inc
				$		20,430	4.13%, 02/15/2021		5,475		5,857
	Leisure Products & Services - 0.00%						4.50%, 09/15/2042		5,675		5,594
	Jarden Corp						5.88%, 11/15/2040		1,690		1,989
	6.13%, 11/15/2022			110		115	6.55%, 05/01/2037		2,895		3,643
							6.75%, 07/01/2018		920		1,070
							8.75%, 02/14/2019		1,635		2,054
	Lodging - 0.14%						Time Warner Inc
	MGM Resorts International						2.10%, 06/01/2019		1,080		1,064
	6.63%, 12/15/2021			1,065		1,166	4.05%, 12/15/2023		5,060		5,259
	7.75%, 03/15/2022			85		98	4.88%, 03/15/2020		795		876
	10.00%, 11/01/2016			1,205		1,365	6.25%, 03/29/2041		6,685		8,047
	Wyndham Worldwide Corp						Unitymedia Hessen GmbH & Co KG /
	2.50%, 03/01/2018			2,920		2,937	Unitymedia NRW GmbH
				$		5,566	5.50%, 01/15/2023 ^(d)		1,275		1,329
	Machinery - Construction & Mining - 0.04%						Unitymedia KabelBW GmbH
							6.13%, 01/15/2025 ^(d)		695		725
	Ferreycorp SAA
	4.88%, 04/26/2020 ^(d)			1,150		1,136	Univision Communications Inc
	Vander Intermediate Holding II Corp						6.88%, 05/15/2019 ^(d)		265		279
	9.75%, PIK 10.50%, 02/01/2019 (d),(g)			385		408	8.50%, 05/15/2021 ^(d)		1,355		1,467
				$		1,544	Viacom Inc
							4.38%, 03/15/2043		1,466		1,351
	Machinery - Diversified - 0.00%						5.85%, 09/01/2043		5,280		5,981
	CNH Industrial America LLC						VTR Finance BV
	7.25%, 01/15/2016			150		158	6.88%, 01/15/2024 ^(d)		2,255		2,368
							WideOpenWest Finance LLC /
	Media- 2.82	%					WideOpenWest Capital Corp
	21st Century Fox America Inc						13.38%, 10/15/2019		2,170		2,474
	3.70%, 09/15/2024 ^(d)			2,530		2,571	10.25%, 07/15/2019		1,395		1,531
	5.40%, 10/01/2043			1,945		2,202			$		111,344
	6.15%, 02/15/2041			4,315		5,313	Metal Fabrication & Hardware - 0.02%
	British Sky Broadcasting Group PLC						Wise Metals Intermediate Holdings LLC/Wise
	2.63%, 09/16/2019 ^(d)			3,360		3,369	Holdings Finance Corp
	Cablevision Systems Corp						9.75%, PIK 10.50%, 06/15/2019 ^(d),(g)		805		873
	8.00%, 04/15/2020			990		1,134
	CBS Corp
	5.75%, 04/15/2020			1,640		1,879	Mining - 0.89%
	Columbus International Inc						Alcoa Inc
	7.38%, 03/30/2021 ^(d)			1,000		1,060	5.13%, 10/01/2024		3,690		3,896
	Comcast Corp						Anglo American Capital PLC
							1.18%, 04/15/2016 ^(b),(d),(e)		4,150		4,167
	4.20%, 08/15/2034			2,095		2,114	9.38%, 04/08/2019 ^(d)		2,590		3,271
	4.75%, 03/01/2044			1,460		1,569
	6.40%, 03/01/2040			1,975		2,560	Barrick Gold Corp
	6.50%, 11/15/2035			330		433	3.85%, 04/01/2022		2,095		2,008
	CSC Holdings LLC						BHP Billiton Finance USA Ltd
	6.75%, 11/15/2021			280		312	2.05%, 09/30/2018		1,670		1,686
	Cumulus Media Holdings Inc						Corp Nacional del Cobre de Chile
							4.88%, 11/04/2044 ^(d),(f)		2,300		2,276
	7.75%, 05/01/2019			695		712


Schedule of Investments
Bond & Mortgage Securities Fund
October 31, 2014



		Principal					Principal
BONDS (continued)		Amount (000's)		Value (000's)	BONDS (continued)		Amount (000's)		Value (000's)

Mining (continued)					Mortgage Backed Securities (continued)
FMG Resources August 2006 Pty Ltd					Credit Suisse Commercial Mortgage Trust
6.88%, 02/01/2018 ^(d)	$	220	$	225	Series 2006-C3
6.88%, 04/01/2022 ^(d)		1,895		1,957	5.81%, 06/15/2038 ^(e)	$	94	$	99
8.25%, 11/01/2019 ^(d)		730		757	Credit Suisse Commercial Mortgage Trust
Freeport-McMoRan Inc					Series 2006-C5
3.10%, 03/15/2020		2,710		2,701	0.72%, 12/15/2039 ^(e)		13,692		167
5.45%, 03/15/2043		405		414	Credit Suisse Commercial Mortgage Trust
Newmont Mining Corp					Series 2007-C3
4.88%, 03/15/2042		3,895		3,259	5.70%, 06/15/2039 ^(e)		1,699		1,830
Rio Tinto Finance USA Ltd					Credit Suisse First Boston Mortgage Securities
9.00%, 05/01/2019		2,670		3,446	Corp
Rio Tinto Finance USA PLC					0.55%, 11/15/2037 ^(d),(e)		3,618		—
2.00%, 03/22/2017		2,350		2,383	4.77%, 07/15/2037		2,025		2,054
St Barbara Ltd					CSMC Series 2009-RR1
8.88%, 04/15/2018 ^(d)		680		544	5.38%, 02/15/2040 ^(d)		3,165		3,332
Taseko Mines Ltd					CSMC Series 2009-RR3
7.75%, 04/15/2019		330		313	5.34%, 12/15/2043 ^(d),(e)		1,545		1,652
Teck Resources Ltd					DBUBS 2011-LC2 Mortgage Trust
5.20%, 03/01/2042		1,380		1,262	5.44%, 07/10/2044 ^(d),(e)		5,000		5,273
Volcan Cia Minera SAA					Fannie Mae REMIC Trust 2005-W2
5.38%, 02/02/2022 ^(d)		350		347	0.35%, 05/25/2035 ^(e)		729		724
5.38%, 02/02/2022		350		347	Fannie Mae REMICS
		$		35,259	2.25%, 07/25/2040		432		430
					3.50%, 05/25/2027 ^(e)		8,194		998
Miscellaneous Manufacturing - 0.82%					3.50%, 11/25/2027 ^(e)		3,077		405
General Electric Co					3.50%, 04/25/2028 ^(e)		9,334		1,167
4.50%, 03/11/2044		2,695		2,873	3.50%, 07/25/2040		3,713		3,742
Ingersoll-Rand Global Holding Co Ltd					4.00%, 12/25/2028 ^(e)		5,828		754
2.88%, 01/15/2019		1,065		1,089	6.35%, 12/25/2021 ^(e)		1,617		194
Ingersoll-Rand Luxembourg Finance SA					6.35%, 03/25/2022 ^(e)		955		112
3.55%, 11/01/2024		5,465		5,392	6.60%, 11/25/2036 ^(e)		2,683		442
Textron Inc					38.48%, 08/25/2035 ^(e)		45		10
6.20%, 03/15/2015		1,835		1,872	Freddie Mac REMICS
Tyco Electronics Group SA					0.60%, 06/15/2023 ^(e)		66		66
0.43%, 01/29/2016 ^(e)		1,735		1,734
					0.75%, 08/15/2018 ^(e)		603		608
1.60%, 02/03/2015		1,265		1,269	1.25%, 09/15/2033		10,500		10,544
2.35%, 08/01/2019		10,395		10,423	2.00%, 02/15/2036 ^(e)		1,621		1,619
2.38%, 12/17/2018		2,150		2,172	2.75%, 03/15/2041		2,510		2,569
3.45%, 08/01/2024		1,650		1,669	3.00%, 10/15/2027 ^(e)		1,939		242
3.50%, 02/03/2022		3,695		3,814	4.00%, 09/15/2021		255		259
7.13%, 10/01/2037		105		140	4.00%, 11/15/2025 ^(e)		13,667		1,633
		$		32,447	4.50%, 02/15/2029 ^(e)		8,700		893
Mortgage Backed Securities - 6.23%					6.50%, 05/15/2026 ^(e)		3,312		507
Adjustable Rate Mortgage Trust 2004-2					6.50%, 08/15/2026 ^(e)		4,602		754
1.29%, 02/25/2035 ^(e)		82		82	6.55%, 09/15/2026 ^(e)		6,031		1,042
Banc of America Commercial Mortgage Trust					6.60%, 09/15/2034 ^(e)		1,473		162
2006-3					Freddie Mac Structured Agency Credit Risk
5.89%, 07/10/2044		586		621	Debt Notes
Banc of America Commercial Mortgage Trust					1.00%, 04/25/2024 ^(e)		7,031		6,952
2007-3					1.50%, 08/25/2024 ^(e)		8,394		8,372
0.43%, 06/10/2049 ^(d),(e)		1,000		961	1.55%, 10/25/2024 ^(e)		5,000		5,001
Banc of America Commercial Mortgage Trust					1.60%, 09/25/2024 ^(e)		15,000		14,952
2008-1					1.80%, 08/25/2024 ^(e)		6,453		6,453
6.29%, 02/10/2051 ^(e)		3,255		3,616	GE Commercial Mortgage Corp Series 2007-
BB-UBS Trust					C1 Trust
2.89%, 06/05/2030 ^(d),(e)		2,100		2,049	5.61%, 12/10/2049 ^(e)		6,575		6,922
BCRR Trust 2009-1					Ginnie Mae
5.86%, 07/17/2040 ^(d)		1,945		2,122	1.75%, 10/16/2037		1,143		1,156
CD 2006-CD3 Mortgage Trust					4.00%, 11/16/2028 ^(e)		10,955		1,386
5.62%, 10/15/2048		2,178		2,297	4.50%, 05/16/2043 ^(e)		4,523		913
CD 2007-CD4 Commercial Mortgage Trust					4.50%, 04/16/2044		1,791		381
5.37%, 12/11/2049		3,490		3,650	5.00%, 10/16/2022 ^(e)		3,414		146
COMM 2010-RR1					GS Mortgage Securities Trust 2011-GC5
5.54%, 12/11/2049 ^(d),(e)		900		944	1.70%, 08/10/2044 ^(d),(e)		151,707		9,268
COMM 2014-LC17 Mortgage Trust					GS Mortgage Securities Trust 2012-GCJ7
4.49%, 10/10/2047		5,000		5,223	2.57%, 05/10/2045 ^(e)		19,293		2,234
COMM 2014-UBS5 Mortgage Trust					GS Mortgage Securities Trust 2013-GC16
1.12%, 09/10/2047 ^(e)		71,966		5,058	1.55%, 11/10/2046 ^(e)		11,902		959
Commercial Mortgage Pass Through					GS Mortgage Securities Trust 2013-GCJ12
Certificates					3.78%, 06/10/2046 ^(e)		780		787
4.77%, 10/15/2045 ^(d),(e)		5,290		5,463	Impac CMB Trust Series 2007-A
					0.40%, 05/25/2037 ^(e)		2,013		1,968


Schedule of Investments
Bond & Mortgage Securities Fund
October 31, 2014



			Principal					Principal
	BONDS (continued)		Amount (000's) Value (000's)			BONDS (continued)		Amount (000's) Value (000's)

	Mortgage Backed Securities (continued)					Mortgage Backed Securities (continued)
	JP Morgan Chase Commercial Mortgage					Morgan Stanley Bank of America Merrill
	Securities Corp					Lynch Trust 2014-C18
	1.93%, 12/15/2047 ^(e)	$	22,187	$	2,122	4.45%, 10/15/2047 ^(e)	$	3,250	$	3,426
	3.35%, 12/15/2047 ^(d),(e)		500		502	Morgan Stanley Capital I Trust 2007-HQ12
	JP Morgan Chase Commercial Mortgage					5.59%, 04/12/2049 ^(e)		1,360		1,460
	Securities Trust 2005-CIBC12					5.59%, 04/12/2049 ^(e)		4,454		4,504
	5.09%, 09/12/2037 ^(e)		300		146	Morgan Stanley Capital I Trust 2007-IQ13
	JP Morgan Chase Commercial Mortgage					5.36%, 03/15/2044 ^(e)		700		758
	Securities Trust 2006-CIBC17					MSBAM Commercial Mortgage Securities
	5.43%, 12/12/2043		2,200		2,336	Trust 2012-CKSV
	5.46%, 12/12/2043		5,000		5,211	1.14%, 10/15/2022 ^(d),(e)		23,475		1,708
	JP Morgan Chase Commercial Mortgage					3.28%, 10/15/2022 ^(d)		3,075		2,996
	Securities Trust 2006-LDP9					Residential Asset Securitization Trust 2004-
	5.34%, 05/15/2047		222		237	A10
	JP Morgan Chase Commercial Mortgage					5.50%, 02/25/2035		310		314
	Securities Trust 2007-C1					UBS Commercial Mortgage Trust 2012-C1
	0.46%, 02/15/2051 ^(e)		27,899		11	3.40%, 05/10/2045 ^(e)		550		566
	5.96%, 02/15/2051 ^(e)		7,100		7,667	UBS-Barclays Commercial Mortgage Trust
	JP Morgan Chase Commercial Mortgage					2012-C3
	Securities Trust 2011-C5					3.09%, 08/10/2049 ^(e)		2,125		2,138
	3.15%, 08/15/2046		1,972		2,040	UBS-Barclays Commercial Mortgage Trust
	5.32%, 08/15/2046 ^(d),(e)		800		886	2012-C4
	JP Morgan Chase Commercial Mortgage					1.86%, 12/10/2045 ^(d),(e)		20,349		2,125
	Securities Trust 2013-C16					UBS-Barclays Commercial Mortgage Trust
	1.37%, 12/15/2046 ^(e)		13,384		927	2013-C5
	JPMBB Commercial Mortgage Securities					3.18%, 03/10/2046 ^(e)		2,025		2,033
	Trust 2013-C15					4.09%, 03/10/2046 ^(d),(e)		1,090		1,010
	1.60%, 11/15/2045 ^(e)		49,965		3,660	Wachovia Bank Commercial Mortgage Trust
	JPMBB Commercial Mortgage Securities					Series 2007-C30
	Trust 2014-C18					0.36%, 12/15/2043 ^(d),(e)		1,350		1,306
	4.81%, 02/15/2047 ^(e)		2,700		2,829	5.25%, 12/15/2043		1,362		1,362
	JPMBB Commercial Mortgage Securities					Wachovia Bank Commercial Mortgage Trust
	Trust 2014-C19					Series 2007-C34
	1.29%, 04/15/2047 ^(e)		47,861		2,903	5.68%, 05/15/2046 ^(e)		250		272
	JPMBB Commercial Mortgage Securities					Wells Fargo Mortgage Backed Securities
	Trust 2014-C24					2005-AR16 Trust
	1.24%, 11/15/2047 ^(e)		9,500		669	2.61%, 03/25/2035 ^(e)		501		494
	LB-UBS Commercial Mortgage Trust 2005-					WFRBS Commercial Mortgage Trust 2013-
	C3					C12
	0.73%, 07/15/2040 ^(d),(e)		35,810		195	1.50%, 03/15/2048 ^(d),(e)		59,025		4,899
	4.74%, 07/15/2030		1,652		1,668	WFRBS Commercial Mortgage Trust 2014-
	LB-UBS Commercial Mortgage Trust 2005-					C22
	C7					4.07%, 09/15/2057		5,000		5,192
	5.32%, 11/15/2040		2,200		2,270	4.37%, 09/15/2057 ^(e)		2,000		2,080
	LB-UBS Commercial Mortgage Trust 2007-					WFRBS Commercial Mortgage Trust 2014-
	C1					C23
	0.40%, 02/15/2040 ^(e)		10,214		95	0.73%, 10/15/2057 ^(e)		55,000		2,639
	LB-UBS Commercial Mortgage Trust 2007-							$		245,970
	C2
	5.43%, 02/15/2040		1,923		2,082	Office & Business Equipment - 0.19%
	LB-UBS Commercial Mortgage Trust 2007-					Xerox Corp
	C6					2.95%, 03/15/2017		555		574
	6.11%, 07/15/2040		7,350		8,033	3.80%, 05/15/2024		4,410		4,322
	MASTR Asset Securitization Trust 2005-2					6.75%, 02/01/2017		550		613
	5.25%, 11/25/2035		836		838	6.75%, 12/15/2039		1,730		2,112
	Merrill Lynch Mortgage Investors Trust Series							$		7,621
	2005-A8					Oil & Gas - 4.42%
	0.50%, 08/25/2036 ^(e)		192		162	Afren PLC
	Merrill Lynch Mortgage Trust 2005-CIP1					6.63%, 12/09/2020 ^(d)		1,300		1,219
	5.05%, 07/12/2038		855		870	Anadarko Petroleum Corp
	ML-CFC Commercial Mortgage Trust 2006-					3.45%, 07/15/2024		6,395		6,304
	4					5.95%, 09/15/2016		3,390		3,684
	0.62%, 12/12/2049 ^(e)		67,144		34	6.45%, 09/15/2036		625		771
	Morgan Stanley Bank of America Merrill					Apache Corp
	Lynch Trust 2013-C11					4.25%, 01/15/2044		3,675		3,408
	0.79%, 08/15/2046 ^(e)		29,535		883	4.75%, 04/15/2043		895		896
	Morgan Stanley Bank of America Merrill					Baytex Energy Corp
	Lynch Trust 2013-C9					5.13%, 06/01/2021 ^(d)		370		361
	3.46%, 05/15/2046		5,806		5,870	BP Capital Markets PLC
	Morgan Stanley Bank of America Merrill					0.77%, 05/10/2019 ^(e)		6,585		6,576
	Lynch Trust 2014-C15					Carrizo Oil & Gas Inc
	4.05%, 04/15/2047		5,000		5,323	7.50%, 09/15/2020		2,812		2,840


Schedule of Investments
Bond & Mortgage Securities Fund
October 31, 2014



		Principal					Principal
BONDS (continued)		Amount (000's)		Value (000's)	BONDS (continued)		Amount (000's)		Value (000's)

Oil & Gas (continued)					Oil & Gas (continued)
Carrizo Oil & Gas Inc (continued)					Pacific Rubiales Energy Corp
8.63%, 10/15/2018	$	765	$	796	5.13%, 03/28/2023 ^(d)	$	1,700	$	1,628
Chaparral Energy Inc					5.63%, 01/19/2025 ^(d)		5,000		4,755
7.63%, 11/15/2022		1,456		1,420	7.25%, 12/12/2021 ^(d)		3,915		4,179
9.88%, 10/01/2020		655		691	PDC Energy Inc
Chesapeake Energy Corp					7.75%, 10/15/2022		1,650		1,733
3.25%, 03/15/2016		295		295	Petrobras Global Finance BV
3.48%, 04/15/2019 ^(e)		3,800		3,803	3.25%, 03/17/2017		4,053		4,097
4.88%, 04/15/2022		700		716	Petrobras International Finance Co SA
6.13%, 02/15/2021		615		683	5.38%, 01/27/2021		5,000		5,119
Chevron Corp					Petroleos de Venezuela SA
1.10%, 12/05/2017		205		204	5.25%, 04/12/2017		6,450		4,276
Cimarex Energy Co					Petroleos Mexicanos
4.38%, 06/01/2024		1,000		1,016	4.88%, 01/24/2022		6,750		7,196
CNOOC Finance 2013 Ltd					4.88%, 01/18/2024		2,000		2,115
3.00%, 05/09/2023		2,600		2,466	5.50%, 06/27/2044 ^(d)		1,750		1,824
CNOOC Nexen Finance 2014 ULC					QEP Resources Inc
4.25%, 04/30/2024		3,150		3,254	5.25%, 05/01/2023		1,025		997
ConocoPhillips					6.80%, 04/01/2018		200		214
5.75%, 02/01/2019		500		575	QGOG Constellation SA
Continental Resources Inc/OK					6.25%, 11/09/2019 ^(d)		2,100		2,069
4.50%, 04/15/2023		1,945		2,037	RKI Exploration & Production LLC / RKI
4.90%, 06/01/2044		5,720		5,649	Finance Corp
Delek & Avner Tamar Bond Ltd					8.50%, 08/01/2021 ^(d)		874		854
5.41%, 12/30/2025 ^(d)		875		894	Rosneft Oil Co via Rosneft International
Denbury Resources Inc					Finance Ltd
5.50%, 05/01/2022		1,055		1,039	4.20%, 03/06/2022 ^(d)		1,550		1,352
Devon Energy Corp					Rowan Cos Inc
2.25%, 12/15/2018		4,935		4,941	4.75%, 01/15/2024		515		513
Drill Rigs Holdings Inc					5.00%, 09/01/2017		1,875		2,019
6.50%, 10/01/2017 ^(d)		330		310	5.40%, 12/01/2042		2,215		2,067
Ecopetrol SA					Seadrill Ltd
4.13%, 01/16/2025		4,215		4,110	6.13%, 09/15/2017 ^(d)		2,440		2,374
5.88%, 09/18/2023		6,450		7,192	Seventy Seven Energy Inc
Encana Corp					6.50%, 07/15/2022 ^(d)		1,415		1,330
5.15%, 11/15/2041		1,035		1,106	Seventy Seven Operating LLC
EP Energy LLC / Everest Acquisition Finance					6.63%, 11/15/2019		250		247
Inc					Statoil ASA
9.38%, 05/01/2020		1,210		1,322	1.20%, 01/17/2018		1,700		1,691
GeoPark Latin America Ltd Agencia en Chile					1.80%, 11/23/2016		2,535		2,582
7.50%, 02/11/2020 ^(d)		1,550		1,643	Talisman Energy Inc
Halcon Resources Corp					3.75%, 02/01/2021		5,365		5,362
8.88%, 05/15/2021		340		279	5.50%, 05/15/2042		2,680		2,620
9.25%, 02/15/2022		325		264	7.75%, 06/01/2019		2,355		2,790
9.75%, 07/15/2020		995		830	Total Capital International SA
KazMunayGas National Co JSC					1.50%, 02/17/2017		1,495		1,509
4.40%, 04/30/2023 ^(d)		2,250		2,210	1.55%, 06/28/2017		1,240		1,248
Kerr-McGee Corp					Total Capital SA
7.88%, 09/15/2031		4,025		5,533	2.13%, 08/10/2018		1,620		1,647
Kodiak Oil & Gas Corp					Transocean Inc
5.50%, 01/15/2021		2,235		2,269	3.80%, 10/15/2022		5,010		4,511
5.50%, 02/01/2022		260		265	6.38%, 12/15/2021		2,580		2,711
8.13%, 12/01/2019		570		613	Triangle USA Petroleum Corp
Linn Energy LLC / Linn Energy Finance					6.75%, 07/15/2022 ^(d)		640		560
Corp					Ultra Petroleum Corp
6.25%, 11/01/2019 ^(e)		820		754	6.13%, 10/01/2024 ^(d)		1,835		1,736
6.50%, 05/15/2019		815		762			$		174,619
6.50%, 09/15/2021		1,195		1,093
Nabors Industries Inc					Oil & Gas Services - 0.32%
2.35%, 09/15/2016		1,400		1,421	CGG SA
					6.88%, 01/15/2022 ^(d)		275		220
Newfield Exploration Co
6.88%, 02/01/2020		460		477	Exterran Partners LP / EXLP Finance Corp
					6.00%, 10/01/2022 ^(d)		395		379
Northern Blizzard Resources Inc
7.25%, 02/01/2022 ^(d)		715		679	FTS International Inc
					6.25%, 05/01/2022 ^(d)		360		340
Oasis Petroleum Inc
6.50%, 11/01/2021		455		466	Key Energy Services Inc
6.88%, 03/15/2022		290		302	6.75%, 03/01/2021		2,450		2,180
6.88%, 01/15/2023		1,820		1,893	PHI Inc
Ocean Rig UDW Inc					5.25%, 03/15/2019		755		746
7.25%, 04/01/2019 ^(d)		1,205		1,030	Weatherford International LLC
Pacific Drilling SA					6.35%, 06/15/2017		850		947
5.38%, 06/01/2020 ^(d)		1,490		1,333	Weatherford International Ltd/Bermuda
					5.95%, 04/15/2042		5,455		5,773


Schedule of Investments
Bond & Mortgage Securities Fund
October 31, 2014



	Principal				Principal
BONDS (continued)	Amount (000's)	Value (000's)		BONDS (continued)	Amount (000's)	Value (000's)

Oil & Gas Services (continued)				Packaging & Containers (continued)
Weatherford International				Reynolds Group Issuer Inc / Reynolds Group
Ltd/Bermuda (continued)				Issuer LLC / Reynolds Group Issuer
6.50%, 08/01/2036	$1,875	$	2,101	(Luxembourg) S.A.
	$		12,686	7.13%, 04/15/2019	$1,825	$	1,896
				7.88%, 08/15/2019	260		279
Other Asset Backed Securities - 2.22%				9.00%, 04/15/2019	400		418
Chase Funding Trust Series 2003-5				9.88%, 08/15/2019	3		3
0.75%, 07/25/2033 ^(e)	1,040		989
				Rock-Tenn Co
Chase Funding Trust Series 2004-1				3.50%, 03/01/2020	4,330		4,425
0.61%, 12/25/2033 ^(e)	23		21
				4.90%, 03/01/2022	3,045		3,273
CIT Equipment Collateral 2013-VT1					$		24,529
0.65%, 03/21/2016 ^(d)	4,282		4,283
Countrywide Asset-Backed Certificates				Pharmaceuticals - 1.32%
0.31%, 10/25/2047 ^(e)	2,266		2,243	Actavis Funding SCS
0.93%, 06/25/2035 ^(e)	130		130	4.85%, 06/15/2044 ^(d)	4,335		4,088
1.76%, 01/25/2034 ^(e)	13		12	Bayer US Finance LLC
Dell Equipment Finance Trust 2014-1				1.50%, 10/06/2017 ^(d)	1,490		1,495
0.64%, 07/22/2016 ^(d)	3,400		3,399	2.38%, 10/08/2019 ^(d)	9,320		9,336
GE Dealer Floorplan Master Note Trust				3.00%, 10/08/2021 ^(d)	7,845		7,880
0.54%, 07/20/2019 ^(e)	14,000		13,985	Express Scripts Holding Co
0.56%, 04/20/2018 ^(e)	28,127		28,206	2.25%, 06/15/2019	2,365		2,351
GE Equipment Transportation LLC Series				2.75%, 11/21/2014	2,305		2,308
2013-2				6.13%, 11/15/2041	160		198
0.61%, 06/24/2016 ^(e)	6,399		6,405	Forest Laboratories Inc
GreatAmerica Leasing Receivables				5.00%, 12/15/2021 ^(d)	12,770		13,684
0.61%, 05/15/2016 ^(d),(e)	5,187		5,188	GlaxoSmithKline Capital Inc
GreatAmerica Leasing Receivables Funding				5.38%, 04/15/2034	255		302
LLC				GlaxoSmithKline Capital PLC
1.66%, 04/17/2017 ^(d)	1,917		1,929	1.50%, 05/08/2017	1,385		1,397
John Deere Owner Trust 2013-B				Grifols Worldwide Operations Ltd
0.55%, 01/15/2016 ^(e)	578		578	5.25%, 04/01/2022 ^(d)	1,000		1,025
JP Morgan Mortgage Acquisition Trust 2007-				Par Pharmaceutical Cos Inc
CH3				7.38%, 10/15/2020	1,832		1,947
0.30%, 03/25/2037 ^(e)	2,410		2,374	Perrigo Co PLC
MSDWCC Heloc Trust 2005-1				1.30%, 11/08/2016	690		689
0.53%, 07/25/2017 ^(e)	53		52	Salix Pharmaceuticals Ltd
Popular ABS Mortgage Pass-Through Trust				6.00%, 01/15/2021 ^(d)	1,515		1,640
2005-1				Sanofi
0.42%, 05/25/2035 ^(e)	1,308		1,139	4.00%, 03/29/2021	855		926
Trade MAPS 1 Ltd				Valeant Pharmaceuticals International Inc
0.85%, 12/10/2018 ^(d),(e)	11,500		11,501	7.50%, 07/15/2021 ^(d)	1,530		1,637
Volvo Financial Equipment LLC Series 2013-				Wyeth LLC
1				6.00%, 02/15/2036	565		715
0.53%, 11/16/2015 ^(d),(e)	1,134		1,134	Zoetis Inc
Volvo Financial Equipment LLC Series 2014-				1.15%, 02/01/2016	490		491
1					$		52,109
0.54%, 11/15/2016 ^(d),(e)	4,000		4,001
	$		87,569	Pipelines - 1.96%
				Access Midstream Partners LP / ACMP
Packaging & Containers - 0.62%				Finance Corp
Ardagh Finance Holdings SA				4.88%, 05/15/2023	6,130		6,406
8.63%, PIK 8.63%, 06/15/2019 ^(d),(g)	350		358	4.88%, 03/15/2024	2,950		3,083
Ardagh Packaging Finance PLC / Ardagh				6.13%, 07/15/2022	1,100		1,196
Holdings USA Inc				Boardwalk Pipelines LP
3.23%, 12/15/2019 ^(d),(e)	1,150		1,124	3.38%, 02/01/2023	4,445		4,139
6.00%, 06/30/2021 ^(d)	220		217	Buckeye Partners LP
7.00%, 11/15/2020 ^(d)	46		47	2.65%, 11/15/2018	520		519
Berry Plastics Corp				4.35%, 10/15/2024	6,685		6,652
5.50%, 05/15/2022	2,000		2,007	DCP Midstream LLC
Beverage Packaging Holdings Luxembourg II				5.85%, 05/21/2043 ^(d),(e)	880		869
SA / Beverage Packaging Holdings II				El Paso Pipeline Partners Operating Co LLC
5.63%, 12/15/2016 ^(d)	240		241	4.70%, 11/01/2042	1,540		1,367
6.00%, 06/15/2017 ^(d)	510		509	5.00%, 10/01/2021	5,575		5,951
Coveris Holdings SA				Enable Midstream Partners LP
7.88%, 11/01/2019 ^(d)	490		514	2.40%, 05/15/2019 ^(d)	3,770		3,721
Crown Cork & Seal Co Inc				Enbridge Inc
7.38%, 12/15/2026	1,860		2,055	0.68%, 06/02/2017 ^(e)	4,580		4,581
Exopack Holding Corp				3.50%, 06/10/2024	4,875		4,824
10.00%, 06/01/2018 ^(d)	960		1,032	Energy Transfer Equity LP
Packaging Corp of America				5.88%, 01/15/2024	410		430
4.50%, 11/01/2023	5,775		6,131	Energy Transfer Partners LP
				5.95%, 10/01/2043	1,770		1,956
				6.70%, 07/01/2018	377		432


Schedule of Investments
Bond & Mortgage Securities Fund
October 31, 2014



			Principal				Principal
	BONDS (continued)		Amount (000's)		Value (000's)	BONDS (continued)	Amount (000's)			Value (000's)

	Pipelines (continued)					Retail (continued)
	Enterprise Products Operating LLC					Landry's Holdings II Inc
	4.85%, 03/15/2044		$1,845	$	1,900	10.25%, 01/01/2018 ^(d)		$1,085	$	1,128
	Kinder Morgan Energy Partners LP					Landry's Inc
	2.65%, 02/01/2019		3,965		3,967	9.38%, 05/01/2020 ^(d)		1,055		1,128
	5.63%, 09/01/2041		1,130		1,140	Macy's Retail Holdings Inc
	Plains All American Pipeline LP / PAA					5.90%, 12/01/2016		3,694		4,056
	Finance Corp					6.38%, 03/15/2037		1,245		1,547
	3.60%, 11/01/2024		2,355		2,341	6.90%, 04/01/2029		145		184
	Regency Energy Partners LP / Regency					Michaels FinCo Holdings LLC / Michaels
	Energy Finance Corp					FinCo Inc
	5.00%, 10/01/2022		1,185		1,209	7.50%, PIK 8.25%, 08/01/2018 ^(d),(g)		270		274
	Sabine Pass Liquefaction LLC					Michaels Stores Inc
	5.63%, 02/01/2021 ^(e)		990		1,037	5.88%, 12/15/2020 ^(d)		827		837
	6.25%, 03/15/2022 ^(d)		745		803	Neiman Marcus Group LTD LLC
	Targa Resources Partners LP / Targa					8.75%, 10/15/2021 ^(d)		1,000		1,070
	Resources Partners Finance Corp					New Academy Finance Co LLC / New
	4.13%, 11/15/2019 ^(d)		140		142	Academy Finance Corp
	TransCanada PipeLines Ltd					8.00%, PIK 8.75%, 06/15/2018 ^(d),(g)		1,455		1,464
	4.63%, 03/01/2034		1,270		1,334	Petco Holdings Inc
	5.00%, 10/16/2043		1,605		1,718	8.50%, PIK 9.25%, 10/15/2017 ^(d),(g)		1,130		1,136
	7.13%, 01/15/2019		730		867	SACI Falabella
	Transportadora de Gas Internacional SA ESP					4.38%, 01/27/2025 ^(d)		1,850		1,857
	5.70%, 03/20/2022 ^(d)		300		320	Suburban Propane Partners LP/Suburban
	5.70%, 03/20/2022		3,250		3,473	Energy Finance Corp
	Western Gas Partners LP					7.38%, 03/15/2020		715		745
	2.60%, 08/15/2018		3,900		3,954	Target Corp
	5.45%, 04/01/2044		3,515		3,816	2.30%, 06/26/2019		700		704
	Williams Cos Inc/The					4.00%, 07/01/2042		520		499
	7.88%, 09/01/2021		2,770		3,344	Wal-Mart Stores Inc
			$		77,491	1.00%, 04/21/2017		4,850		4,847
						4.75%, 10/02/2043		4,005		4,446
	Real Estate - 0.31%							$		44,830
	China Overseas Finance Cayman VI Ltd
	4.25%, 05/08/2019		1,750		1,790	Savings & Loans - 0.05%
	Crescent Resources LLC / Crescent Ventures					Santander Holdings USA Inc/PA
	Inc					3.00%, 09/24/2015		2,055		2,090
	10.25%, 08/15/2017 ^(d)		1,190		1,303
	Regency Centers LP
	5.88%, 06/15/2017		8,275		9,153	Semiconductors - 0.09%
						KLA-Tencor Corp
			$		12,246	4.65%, 11/01/2024 ^(f)		1,035		1,038
	REITS- 0.20	%				Semiconductor Manufacturing International
	DuPont Fabros Technology LP					Corp
	5.88%, 09/15/2021		415		432	4.13%, 10/07/2019 ^(d)		2,500		2,515
	HCP Inc							$		3,553
	2.63%, 02/01/2020		2,140		2,124
	3.88%, 08/15/2024		1,535		1,534	Software - 0.35%
						Activision Blizzard Inc
	iStar Financial Inc					5.63%, 09/15/2021 ^(d)		2,885		3,069
	3.88%, 07/01/2016		245		248	6.13%, 09/15/2023 ^(d)		970		1,050
	4.88%, 07/01/2018		390		389	Oracle Corp
	5.00%, 07/01/2019		125		125
	9.00%, 06/01/2017		490		550	2.38%, 01/15/2019		5,725		5,816
						2.50%, 10/15/2022		773		746
	Prologis LP					4.30%, 07/08/2034		3,125		3,216
	4.25%, 08/15/2023		1,445		1,506
	6.88%, 03/15/2020		743		876			$		13,897
			$		7,784	Sovereign - 0.93%
						Belgium Government Bond
	Retail - 1.14%					3.00%, 09/28/2019	EUR	95		135
	Building Materials Holding Corp					4.25%, 09/28/2021 ^(d)		35		55
	9.00%, 09/15/2018 ^(d)		750		808
	Claire's Stores Inc					4.25%, 09/28/2022		375		594
	7.75%, 06/01/2020(d)		165		116	Brazilian Government International Bond
	9.00%, 03/15/2019 ^(d)		395		403	4.88%, 01/22/2021	$	2,000		2,155
	CVS Health Corp					Bundesrepublik Deutschland
						1.50%, 05/15/2024	EUR	360		480
	2.25%, 12/05/2018		2,320		2,345	3.50%, 07/04/2019		20		29
	2.25%, 08/12/2019		3,120		3,106
	3.38%, 08/12/2024		1,790		1,785	4.75%, 07/04/2028		15		27
						Canadian Government Bond
	4.13%, 05/15/2021		3,160		3,432	1.25%, 03/01/2018	CAD	200		177
	5.30%, 12/05/2043		1,695		1,946
	CVS Pass-Through Trust					2.00%, 12/01/2014		50		44
	5.93%, 01/10/2034 ^(d)		1,116		1,286	Denmark Government Bond
	7.51%, 01/10/2032 ^(d)		2,890		3,681	3.00%, 11/15/2021	DKK	290		57
						4.00%, 11/15/2017		280		53


Schedule of Investments
Bond & Mortgage Securities Fund
October 31, 2014



	Principal					Principal
BONDS (continued)	Amount (000's)			Value (000's)	BONDS (continued)	Amount (000's)		Value (000's)

Sovereign (continued)					Student Loan Asset Backed Securities (continued)
Export Credit Bank of Turkey					SLM Private Education Loan Trust 2012-B
5.00%, 09/23/2021 ^(d)	$	3,500	$	3,527	1.25%, 12/15/2021 ^(d),(e)	$	2,902	$	2,912
France Government Bond OAT					SLM Private Education Loan Trust 2012-C
3.00%, 04/25/2022	EUR	550		804	1.25%, 08/15/2023 ^(d),(e)		5,655		5,685
3.50%, 04/25/2026		30		46	SLM Private Education Loan Trust 2012-D
3.75%, 04/25/2021		85		128	1.20%, 06/15/2023 ^(d),(e)		14,258		14,321
4.50%, 04/25/2041		25		46	SLM Private Education Loan Trust 2012-E
French Treasury Note BTAN					0.90%, 06/15/2016 ^(d),(e)		5,937		5,954
1.75%, 02/25/2017		40		52	SLM Private Education Loan Trust 2013-A
Ireland Government Bond					0.75%, 08/15/2022 ^(d),(e)		6,500		6,507
3.40%, 03/18/2024		20		29	SLM Private Education Loan Trust 2013-B
5.90%, 10/18/2019		300		472	0.80%, 07/15/2022 ^(d),(e)		8,280		8,280
Italy Buoni Poliennali Del Tesoro					SLM Private Education Loan Trust 2014-A
2.75%, 12/01/2015		100		128	0.75%, 07/15/2022 ^(d),(e)		13,821		13,811
3.50%, 03/01/2030 ^(d)		500		663	SLM Student Loan Trust 2008-6
3.75%, 08/01/2021		355		502	0.78%, 10/25/2017 ^(e)		751		752
4.25%, 09/01/2019		75		108	SLM Student Loan Trust 2008-8
4.75%, 06/01/2017		75		103	1.13%, 10/25/2017 ^(e)		266		267
5.00%, 09/01/2040		15		23	SLM Student Loan Trust 2012-6
5.50%, 11/01/2022		75		118	0.43%, 09/25/2019 ^(e)		6,789		6,786
6.00%, 05/01/2031		20		34	SLM Student Loan Trust 2012-7
Japan Government Ten Year Bond					0.31%, 02/27/2017 ^(e)		1,195		1,194
0.60%, 03/20/2023	JPY	24,000		218	SLM Student Loan Trust 2013-6
0.80%, 09/20/2020		7,000		65	0.43%, 02/25/2019 ^(e)		2,180		2,181
1.30%, 03/20/2021		87,000		829			$		77,332
1.40%, 06/20/2019		16,000		151
Japan Government Twenty Year Bond					Telecommunications - 3.33%
1.50%, 06/20/2034		100,000		926	Altice Financing SA
					6.50%, 01/15/2022 ^(d)		475		488
1.90%, 03/20/2024		125,000		1,264	7.88%, 12/15/2019 ^(d)		1,400		1,493
Kenya Government International Bond
5.88%, 06/24/2019 ^(d)	$	3,000		3,109	Altice Finco SA
					8.13%, 01/15/2024 ^(d)		400		421
Mexican Bonos					9.88%, 12/15/2020 ^(d)		250		279
6.50%, 06/10/2021 ^(e)	MXN	550		43
Mexico Government International Bond					Altice SA
					7.75%, 05/15/2022 ^(d)		1,960		2,058
4.00%, 10/02/2023	$	230		240
Netherlands Government Bond					America Movil SAB de CV
2.00%, 07/15/2024	EUR	425		583	5.00%, 03/30/2020		1,600		1,764
2.25%, 07/15/2022 ^(d)		65		91	AT&T Inc
4.00%, 07/15/2018 ^(d)		15		22	2.38%, 11/27/2018		795		804
5.50%, 01/15/2028		25		47	4.30%, 12/15/2042		2,670		2,490
Panama Government International Bond					4.35%, 06/15/2045		5,515		5,148
4.00%, 09/22/2024	$	4,300		4,397	5.80%, 02/15/2019		390		447
Poland Government Bond					Axtel SAB de CV
					8.00%, 01/31/2020 ^(d),(e)		500		500
5.25%, 10/25/2020	PLN	290		101
Romanian Government International Bond					B Communications Ltd
					7.38%, 02/15/2021 ^(d)		230		245
4.88%, 01/22/2024 ^(d)	$	1,850		1,993
Russian Foreign Bond - Eurobond					Bharti Airtel International Netherlands BV
					5.13%, 03/11/2023 ^(d)		2,500		2,641
7.50%, 03/31/2030 ^(e)		7,948		9,017
Spain Government Bond					British Telecommunications PLC
4.25%, 10/31/2016	EUR	60		81	1.63%, 06/28/2016		1,490		1,506
4.65%, 07/30/2025		10		15	CC Holdings GS V LLC / Crown Castle GS
4.85%, 10/31/2020		430		651	III Corp
5.50%, 04/30/2021		100		158	3.85%, 04/15/2023		3,570		3,552
Sweden Government Bond					Digicel Group Ltd
					8.25%, 09/30/2020 ^(d)		7,325		7,655
1.50%, 11/13/2023	SEK	550		77
4.25%, 03/12/2019		200		32	Digicel Ltd
					6.00%, 04/15/2021 ^(d)		700		707
Switzerland Government Bond					8.25%, 09/01/2017 ^(d)		670		686
3.75%, 06/10/2015	CHF	12		13
Turkey Government International Bond					8.25%, 09/01/2017		1,700		1,740
3.25%, 03/23/2023	$	1,500		1,399	Eileme 2 AB
					11.63%, 01/31/2020 ^(d)		830		950
United Kingdom Gilt
1.75%, 07/22/2019	GBP	100		162	Embarq Corp
1.75%, 09/07/2022		150		235	8.00%, 06/01/2036		695		771
4.25%, 12/07/2040		60		119	ENTEL Chile SA
					4.75%, 08/01/2026 ^(d)		2,300		2,329
4.75%, 09/07/2015		75		124
4.75%, 12/07/2030		25		51	Frontier Communications Corp
		$		36,802	6.25%, 09/15/2021		735		759
					Goodman Networks Inc
Student Loan Asset Backed Securities - 1.96%					12.13%, 07/01/2018		810		867
Navient Student Loan Trust					Intelsat Jackson Holdings SA
0.63%, 05/16/2022 ^(d),(e)	$	6,000		6,000	7.25%, 10/15/2020		710		758
SLM Private Education Loan Trust 2012-A					Intelsat Luxembourg SA
1.55%, 08/15/2025 ^(d),(e)		2,654		2,682	6.75%, 06/01/2018		125		129


Schedule of Investments
Bond & Mortgage Securities Fund
October 31, 2014



			Principal					Principal
BONDS (continued)			Amount (000's)	Value (000's)		BONDS (continued)		Amount (000's)			Value (000's)

Telecommunications (continued)						Transportation (continued)
Intelsat Luxembourg SA	(continued)					Navios Maritime Holdings Inc / Navios
7.75%, 06/01/2021		$	3,085	$	3,224	Maritime Finance II US Inc
8.13%, 06/01/2023			630		669	7.38%, 01/15/2022 ^(d)		$	760	$	764
Level 3 Communications Inc						8.13%, 02/15/2019			385		373
11.88%, 02/01/2019			384		414	Navios South American Logistics Inc / Navios
Level 3 Escrow II Inc						Logistics Finance US Inc
5.38%, 08/15/2022 ^(d)			1,320		1,343	7.25%, 05/01/2022 ^(d)			1,460		1,471
Level 3 Financing Inc						Pelabuhan Indonesia III PT
3.82%, 01/15/2018 ^(d),(e)			295		296	4.88%, 10/01/2024 ^(d)			2,000		2,030
6.13%, 01/15/2021 ^(d)			270		283	Swift Services Holdings Inc
8.13%, 07/01/2019			770		824	10.00%, 11/15/2018			445		468
Ooredoo International Finance Ltd						Topaz Marine SA
3.25%, 02/21/2023			600		587	8.63%, 11/01/2018 ^(d)			400		407
Sable International Finance Ltd						Transnet SOC Ltd
8.75%, 02/01/2020 ^(d)			200		218	4.00%, 07/26/2022 ^(d)			1,200		1,155
SoftBank Corp						Union Pacific Corp
4.50%, 04/15/2020 ^(d)			2,050		2,076	4.15%, 01/15/2045			1,380		1,382
Sprint Capital Corp						Union Pacific Railroad Co 2014-1 Pass
6.88%, 11/15/2028			565		549	Through Trust
Sprint Communications Inc						3.23%, 05/14/2026			2,530		2,529
6.00%, 12/01/2016			100		106				$		26,177
6.00%, 11/15/2022			770		768
7.00%, 08/15/2020			3,065		3,249	Trucking & Leasing - 0.01%
9.00%, 11/15/2018 ^(d)			175		206	Jurassic Holdings III Inc
						6.88%, 02/15/2021 ^(d)			385		388
9.13%, 03/01/2017			236		267
Sprint Corp
7.13%, 06/15/2024 ^(d)			1,915		1,968	TOTAL BONDS			$		2,673,348
7.88%, 09/15/2023 ^(d)			680		736			Principal
Telefonica Emisiones SAU						CONVERTIBLE BONDS - 0.05%		Amount (000's) Value (000's)
5.13%, 04/27/2020			11,040		12,217	Semiconductors - 0.05%
5.46%, 02/16/2021			735		825	Jazz Technologies Inc
6.42%, 06/20/2016			595		646	8.00%, 12/31/2018 ^(d)			1,630		1,827
7.05%, 06/20/2036			2,095		2,690
T-Mobile USA Inc						TOTAL CONVERTIBLE BONDS			$		1,827
6.00%, 03/01/2023			540		556	SENIOR FLOATING RATE INTERESTS - Principal
6.13%, 01/15/2022			185		192	3.39	%	Amount (000's) Value (000's)
6.25%, 04/01/2021			2,230		2,327
6.50%, 01/15/2024			190		199	Apparel - 0.02%
6.63%, 04/28/2021			585		616	Calceus Acquisition Inc, Term Loan B1
Verizon Communications Inc						5.00%, 09/24/2020 ^(e)		$	765	$	740
0.63%, 06/09/2017 ^(e)			9,000		9,002
1.35%, 06/09/2017			3,270		3,264	Automobile Manufacturers - 0.08%
1.98%, 09/14/2018 ^(e)			7,303		7,642
2.63%, 02/21/2020 ^(d)			863		858	Chrysler Group LLC, Term Loan B
						3.50%, 05/24/2017 ^(e)			1,033		1,028
3.50%, 11/01/2024			3,290		3,238	Navistar Inc, Term Loan B
4.40%, 11/01/2034			405		395	0.00%, 08/17/2017 ^(e),(h)			2,305		2,309
5.01%, 08/21/2054 ^(d)			6,213		6,322
5.15%, 09/15/2023			7,445		8,338				$		3,337
6.25%, 04/01/2037			425		514	Automobile Parts & Equipment - 0.06%
6.40%, 09/15/2033			5,097		6,208	Federal-Mogul Holdings Corp, Term Loan C
6.90%, 04/15/2038			1,195		1,544	4.75%, 04/02/2021 ^(e)			2,534		2,521
Virgin Media Finance PLC
6.00%, 10/15/2024 ^(d)			405		421
Wind Acquisition Finance SA						Building Materials - 0.06%
4.75%, 07/15/2020 ^(d)			1,245		1,217	GYP Holdings III Corp, Term Loan B
						4.75%, 03/26/2021 ^(e)			811		793
7.38%, 04/23/2021 ^(d)			3,265		3,191
						7.75%, 03/25/2022 ^(e)			1,790		1,783
			$		131,392				$		2,576
Transportation - 0.66%
Burlington Northern Santa Fe LLC						Chemicals - 0.32%
4.45%, 03/15/2043			4,930		4,993	AZ Chem US Inc, Term Loan
						7.50%, 06/10/2022 ^(e)			3,107		3,100
CSX Corp						AZ ChemUS Inc, Term Loan B

5.50%, 04/15/2041			3,305		3,875	4.50%, 06/10/2021(e)			177		177
6.25%, 03/15/2018			740		847
						Eagle SpincoInc, Term Loan B
7.38%, 02/01/2019			964		1,164	3.50%, 01/28/2017 (e)			771		771
Eletson Holdings
9.63%, 01/15/2022 ^(d)			1,475		1,468	Emerald Performance Materials LLC, Term
						Loan
Hornbeck Offshore Services Inc						7.75%, 07/22/2022 ^(e)			4,735		4,652
5.00%, 03/01/2021			440		392
						IneosUS Finance LLC,Term Loan B
Navios Maritime Acquisition Corp / Navios						3.75%, 05/04/2018 (e)			2,583		2,548
Acquisition Finance US Inc
8.13%, 11/15/2021 ^(d)			2,810		2,859


Schedule of Investments
Bond & Mortgage Securities Fund
October 31, 2014



	SENIOR FLOATING RATE INTERESTS			Principal			SENIOR FLOATING RATE INTERESTS			Principal
	(continued)			Amount (000's)		Value (000's)	(continued)			Amount (000's)		Value (000's)

	Chemicals (continued)						Healthcare - Services - 0.16%
	Taminco Global Chemical Corp, Term Loan						CHS/Community Health Systems Inc, Term
	B						Loan D
	3.25%, 02/15/2019 ^(e)		$	1,293	$	1,281	4.25%, 01/27/2021 ^(e)		$	278	$	278
				$		12,529	CHS/Community Health Systems Inc, Term
							Loan E
	Coal- 0.01	%					3.48%, 01/25/2017 ^(e)			844		841
	Arch Coal Inc, Term Loan						DaVita HealthCare Partners Inc, Term Loan
	6.25%, 05/16/2018 ^(e)			710		625
							B
							3.50%, 06/18/2021 ^(e)			434		430
	Commercial Services - 0.04%						MPH Acquisition Holdings LLC, Term Loan
	Interactive Data Corp, Term Loan B						B
	4.75%, 05/02/2021 ^(e)			1,128		1,127	4.00%, 03/19/2021 ^(e)			2,459		2,418
	TMS International Corp, Term Loan B						Radnet Management Inc, Term Loan B
	4.50%, 10/04/2020 ^(e)			308		305	8.00%, 03/25/2021 ^(e)			2,395		2,371
				$		1,432				$		6,338

	Computers - 0.09%						Insurance - 0.15%
	Oberthur Technologies of America Corp,						Asurion LLC, Term Loan
	Term Loan B2						8.50%, 02/19/2021 ^(e)			5,030		5,107
	4.50%, 10/18/2019 ^(e)			2,566		2,524	Asurion LLC, Term Loan B1
	Spansion LLC, Term Loan B						5.00%, 05/24/2019 ^(e)			439		439
	3.75%, 12/18/2019 ^(e)			928		911	Asurion LLC, Term Loan B2
				$		3,435	4.25%, 06/19/2020 ^(e)			348		343
										$		5,889
	Consumer Products - 0.09%
	Dell International LLC, Term Loan B						Internet - 0.03%
	4.50%, 03/24/2020 ^(e)			3,576		3,579	Zayo Group LLC, Term Loan B
							4.00%, 07/02/2019 ^(e)			1,181		1,170

	Diversified Financial Services - 0.03%
	Delos Finance Sarl, Term Loan B						Lodging - 0.16%
	3.50%, 02/26/2021 ^(e)			1,140		1,133	Caesars Entertainment Operating Co Inc, Term
							Loan B6B
							6.99%, 01/28/2018 ^(e)			2,120		1,897
	Electric - 0.04%						Caesars Entertainment Operating Co Inc, Term
	Texas Competitive Electric Holdings Co LLC,						Loan B7
	Term Loan NONEXT						9.75%, 03/01/2017 ^(e)			3,776		3,483
	4.68%, 10/10/2014 ^(e)			1,803		1,304
							Hilton Worldwide Finance LLC, Term Loan
							B
	Electronics - 0.07%						3.50%, 09/23/2020 ^(e)			883		874
	Isola USA Corp, Term Loan B									$		6,254
	9.25%, 11/29/2018 ^(e)			2,645		2,638
							Media- 0.24	%
							Charter Communications Operating LLC,
	Entertainment - 0.28%						Term Loan G
	CCM Merger Inc, Term Loan B						4.25%, 08/12/2021 ^(e)			895		901
	4.50%, 07/30/2021 ^(e)			4,667		4,638	Cumulus Media Holdings Inc, Term Loan B
	Lions Gate Entertainment Corp, Term Loan						4.25%, 12/23/2020 ^(e)			831		821
	5.00%, 07/17/2020 ^(e)			1,075		1,078	iHeartCommunications Inc, Term Loan D-
	NEP/NCP Holdco Inc, Term Loan B						EXT
	4.25%, 01/22/2020 ^(e)			2,127		2,074	6.90%, 01/30/2019 ^(e)			2,375		2,239
	Peninsula Gaming LLC, Term Loan B						Numericable US LLC, Term Loan B1
	4.25%, 11/30/2017 ^(e)			515		513	4.50%, 04/23/2020 ^(e)			460		461
	WMG Acquisition Corp, Term Loan B						Numericable US LLC, Term Loan B2
	3.75%, 07/07/2020 ^(e)			2,985		2,888	4.50%, 04/23/2020 ^(e)			398		399
				$		11,191	Univision Communications Inc, Term Loan
							C3
	Food- 0.03	%					4.00%, 03/01/2020 ^(e)			158		156
	HJ Heinz Co, Term Loan B2						Univision Communications Inc, Term Loan
	3.50%, 03/27/2020 ^(e)			1,408		1,399
							C4
							4.00%, 03/01/2020 ^(e)			2,417		2,391
	Forest Products & Paper - 0.23%						WideOpenWest Finance LLC, Term Loan B
	Caraustar Industries Inc, Term Loan B						4.75%, 03/27/2019 ^(e)			1,375		1,372
	7.50%, 04/26/2019 ^(e)			3,431		3,443	WideOpenWest Finance LLC, Term Loan B1
	NewPage Corp, Term Loan B						3.75%, 07/17/2017 ^(e)			812		805
	9.50%, 02/05/2021 ^(e)			6,005		5,819				$		9,545

				$		9,262	Mining - 0.15%
	Healthcare - Products - 0.06%						American Rock Salt Co LLC, Term Loan
	Accellent Inc, Term Loan						8.00%, 05/16/2022 ^(e)			4,775		4,787
	4.50%, 02/19/2021 ^(e)			1,817		1,797	FMG Resources August 2006 Pty Ltd, Term
	Kinetic Concepts Inc, Term Loan E1						Loan B
	4.00%, 05/04/2018 ^(e)			818		811	3.75%, 06/30/2019 ^(e)			1,142		1,113
				$		2,608				$		5,900


Schedule of Investments
Bond & Mortgage Securities Fund
October 31, 2014



	SENIOR FLOATING RATE INTERESTS		Principal				U.S. GOVERNMENT & GOVERNMENT	Principal
	(continued)		Amount (000's)			Value (000's)	AGENCY OBLIGATIONS - 34.95%	Amount (000's)		Value (000's)
							Federal Home Loan Mortgage Corporation (FHLMC) -2.93%
	Oil & Gas - 0.25%
	Drillships Financing Holding Inc, Term Loan						2.03%, 12/01/2035 ^(e)	$	50	$	54
	B1						2.14%, 06/01/2043 ^(e)		1,884		1,951
	6.00%, 03/31/2021 ^(e)		$	3,647	$	3,478
							2.37%, 07/01/2034 ^(e)		20		21
	Drillships Ocean Ventures Inc, Term Loan B						2.41%, 05/01/2037 ^(e)		314		337
	5.50%, 07/16/2021 ^(e)			374		358
							2.49%, 01/01/2034 ^(e)		51		51
	Seadrill Operating LP, Term Loan B						2.89%, 07/01/2043 ^(e)		8,541		8,786
	4.00%, 02/12/2021 ^(e)			6,015		5,676
	Seventy Seven Operating LLC, Term Loan B						3.00%, 01/01/2043		4,621		4,650
	3.75%, 06/17/2021 ^(e)			234		229	3.50%, 12/01/2042		10,448		10,832
							3.50%, 04/01/2044		5,240		5,436
				$		9,741	3.50%, 08/01/2044		6,887		7,141
	Oil & Gas Services - 0.03%						3.50%, 08/01/2044		11,368		11,793
	FTS International Inc, Term Loan						4.00%, 11/01/2041 ⁽ⁱ⁾		2,100		2,228
	5.75%, 04/09/2021 ^(e)			1,129		1,108	4.00%, 10/01/2044		4,895		5,215
							4.50%, 04/01/2031		2,179		2,374
							4.50%, 08/01/2040		130		141
	Pharmaceuticals - 0.19%						4.50%, 04/01/2041		12,592		13,670
	Grifols Worldwide Operations USA Inc, Term						4.50%, 11/01/2041 ⁽ⁱ⁾		2,000		2,166
	Loan B						4.50%, 12/01/2043		9,067		9,845
	3.15%, 03/05/2021 ^(e)			1,135		1,120
							4.50%, 06/01/2044		3,438		3,733
	JLL/Delta Dutch Newco BV, Term Loan B						5.00%, 03/01/2018		410		432
	4.25%, 01/22/2021 ^(e)			918		894
							5.00%, 05/01/2018		296		312
	Par Pharmaceutical Cos Inc, Term Loan B1						5.00%, 10/01/2018		235		248
	4.00%, 09/30/2019 ^(e)			3,695		3,636
							5.00%, 01/01/2019		309		327
	Valeant Pharmaceuticals International Inc,						5.00%, 06/01/2031		1,795		1,996
	Term Loan BE						5.00%, 02/01/2039		2,117		2,339
	3.50%, 08/05/2020 ^(e)			1,712		1,698
							5.00%, 08/01/2040		4,181		4,659
				$		7,348	5.50%, 03/01/2018		143		151
	Pipelines - 0.02%						5.50%, 08/01/2023		1,143		1,256
	NGPL PipeCo LLC, Term Loan B						5.50%, 04/01/2033		29		32
	6.75%, 05/04/2017 ^(e)			901		898	5.50%, 05/01/2033		149		167
							5.50%, 10/01/2033		127		142
							5.50%, 12/01/2033		1,342		1,506
	REITS- 0.04	%					5.50%, 11/01/2036		1,255		1,400
	iStar Financial Inc, Term Loan A2						5.50%, 04/01/2038		421		475
	7.00%, 03/19/2017 ^(e)			1,431		1,460
							5.50%, 04/01/2038		270		301
							5.50%, 08/01/2038		925		1,054
	Retail - 0.22%						5.50%, 03/01/2040		1,461		1,645
	Academy Ltd, Term Loan B						6.00%, 07/01/2017		15		16
	4.50%, 08/03/2018 ^(e)			1,702		1,694	6.00%, 03/01/2022		36		41
	Michaels Stores Inc, Term Loan B						6.00%, 07/01/2023		493		557
	3.75%, 01/24/2020 ^(e)			1,709		1,677	6.00%, 06/01/2028		6		7
	4.00%, 01/20/2028 ^(e)			2,598		2,550	6.00%, 01/01/2029		2		3
	Neiman Marcus Group LTD LLC, Term						6.00%, 03/01/2031		17		19
	Loan						6.00%, 12/01/2031		71		82
	3.74%, 10/25/2020 ^(e)			2,683		2,646	6.00%, 12/01/2032		74		84
				$		8,567	6.00%, 02/01/2033		155		175
							6.00%, 12/01/2033		66		75
	Semiconductors - 0.03%						6.00%, 10/01/2036 ^(e)		616		699
	Entegris Inc, Term Loan B						6.00%, 12/01/2037 ^(e)		364		411
	3.50%, 03/25/2021 ^(e)			1,085		1,079	6.00%, 01/01/2038		699		794
							6.00%, 01/01/2038 ^(e)		130		147
	Software - 0.11%						6.00%, 07/01/2038		2,884		3,276
	Activision Blizzard Inc, Term Loan B						6.50%, 06/01/2017		45		47
	3.25%, 07/26/2020 ^(e)			2,316		2,315	6.50%, 03/01/2029		1		1
	Evergreen Skills Lux Sarl, Term Loan						6.50%, 03/01/2029		12		14
	4.00%, 04/08/2021 ^(e)			1,072		1,051	6.50%, 05/01/2029		18		21
	First Data Corp, Term Loan B						6.50%, 04/01/2031		8		9
	4.15%, 03/24/2021 ^(e)			1,140		1,132	6.50%, 06/01/2031		2		2
				$		4,498	6.50%, 09/01/2031		4		5
							6.50%, 02/01/2032		5		6
	Telecommunications - 0.10%						6.50%, 02/01/2032		1		2
	Altice Financing SA, Delay-Draw Term Loan						6.50%, 05/01/2032		22		25
	DD						6.50%, 04/01/2035		197		223
	5.50%, 07/03/2019 ^(e)			976		981	6.50%, 10/01/2035		115		131
	Integra Telecom Holdings Inc, Term Loan						7.00%, 12/01/2029		12		13
	5.25%, 02/19/2020 ^(e)			465		457	7.00%, 06/01/2030		14		16
	9.75%, 02/19/2020 ^(e)			1,988		1,953	7.00%, 12/01/2030		12		13
	NTELOS Inc, Term Loan B						7.00%, 09/01/2031		3		3
	5.75%, 11/09/2019 ^(e)			313		312	7.50%, 09/01/2030		3		3
				$		3,703	7.50%, 09/01/2030		3		3
	TOTAL SENIOR FLOATING RATE INTERESTS			$		133,807	7.50%, 01/01/2031		17		19
							7.50%, 03/01/2031		4		5


U.S. GOVERNMENT & GOVERNMENT		Principal			U.S. GOVERNMENT & GOVERNMENT			Principal
AGENCY OBLIGATIONS (continued)		Amount (000's)		Value (000's)	AGENCY OBLIGATIONS (continued)		Amount (000's)		Value (000's)
Federal Home Loan Mortgage Corporation (FHLMC)
(continued)					Federal National Mortgage Association (FNMA) (continued)
					5.00%, 12/01/2039		$	210	$	235
7.50%, 02/01/2032	$	11	$	13	5.00%, 02/01/2040			526		585
8.00%, 09/01/2030		112		125	5.00%, 04/01/2040			964		1,073
		$		115,951	5.00%, 05/01/2040			4,119		4,567
Federal National Mortgage Association (FNMA) - 15.55%					5.00%, 06/01/2040			305		339
1.69%, 10/01/2034 ^(e)		214		223	5.00%, 05/01/2041			5,032		5,590
1.85%, 09/01/2038 ^(e)		2,024		2,111	5.00%, 11/01/2041 ⁽ⁱ⁾			49,000		54,256
2.09%, 07/01/2033 ^(e)		1,126		1,201	5.50%, 09/01/2017			21		22
2.13%, 07/01/2034 ^(e)		372		396	5.50%, 10/01/2017			36		38
2.21%, 12/01/2032 ^(e)		106		112	5.50%, 06/01/2020			405		431
2.22%, 04/01/2036 ^(e)		356		380	5.50%, 09/01/2020			1,098		1,197
2.23%, 02/01/2036 ^(e)		40		40	5.50%, 02/01/2023			81		91
2.24%, 08/01/2035 ^(e)		291		311	5.50%, 06/01/2023			270		302
2.27%, 06/01/2043 ^(e)		5,548		5,556	5.50%, 07/01/2023			6		7
2.31%, 03/01/2035 ^(e)		305		324	5.50%, 07/01/2033			325		365
2.32%, 01/01/2033 ^(e)		123		124	5.50%, 09/01/2033			328		368
2.34%, 12/01/2036 ^(e)		518		563	5.50%, 08/01/2036			3,052		3,414
2.50%, 04/01/2028		5,160		5,259	5.50%, 02/01/2037			171		192
2.50%, 06/01/2028		336		342	5.50%, 04/01/2038			5,806		6,531
2.50%, 12/01/2029 ⁽ⁱ⁾		29,600		29,969	5.50%, 12/01/2038			2,125		2,396
2.63%, 04/01/2033 ^(e)		194		197	5.50%, 05/01/2040			1,619		1,808
2.74%, 03/01/2035 ^(e)		4,670		5,023	5.50%, 05/01/2040			1,535		1,731
3.00%, 11/01/2026 ⁽ⁱ⁾		18,000		18,668	6.00%, 02/01/2023			32		36
3.00%, 07/01/2028		9,148		9,511	6.00%, 02/01/2038 ^(e)			1,421		1,606
3.00%, 08/01/2034		9,898		10,080	6.00%, 05/01/2038			210		239
3.00%, 12/01/2040		237		238	6.00%, 08/01/2038			1,201		1,358
3.00%, 11/01/2042		833		839	6.00%, 08/01/2038			327		370
3.00%, 03/01/2043		7,251		7,267	6.50%, 07/01/2016			1		1
3.00%, 04/01/2043		922		924	6.50%, 02/01/2017			5		6
3.00%, 04/01/2043		7,146		7,160	6.50%, 03/01/2017			2		2
3.00%, 05/01/2043		9,392		9,411	6.50%, 04/01/2017			1		1
3.00%, 08/01/2043		5,778		5,789	6.50%, 08/01/2017			42		43
3.00%, 11/01/2044 ⁽ⁱ⁾		47,400		47,407	6.50%, 05/01/2022			11		13
3.34%, 04/01/2041 ^(e)		1,701		1,798	6.50%, 12/01/2031			8		9
3.50%, 12/01/2025		2,659		2,821	6.50%, 02/01/2032			5		5
3.50%, 11/01/2026 ⁽ⁱ⁾		9,450		9,985	6.50%, 02/01/2032			2		2
3.50%, 06/01/2029		4,843		5,122	6.50%, 04/01/2032			8		9
3.50%, 10/01/2033		6,142		6,450	6.50%, 06/01/2032			3		3
3.50%, 08/01/2034		4,941		5,166	6.50%, 08/01/2032			22		25
3.50%, 01/01/2041		459		475	6.50%, 07/01/2037			783		938
3.50%, 11/01/2041 ⁽ⁱ⁾		28,000		28,954	6.50%, 07/01/2037			539		612
3.50%, 03/01/2042		4,481		4,657	6.50%, 12/01/2037			855		970
3.50%, 02/01/2043		7,171		7,425	6.50%, 02/01/2038			579		692
3.50%, 04/01/2043		4,439		4,596	6.50%, 03/01/2038			389		442
3.50%, 05/01/2043		662		688	6.50%, 09/01/2038			1,281		1,454
3.50%, 07/01/2043		3,519		3,655	7.00%, 02/01/2032			18		20
3.50%, 09/01/2043		11,562		12,017	7.00%, 03/01/2032			58		67
3.50%, 08/01/2044		9,952		10,324	7.50%, 08/01/2032			15		18
4.00%, 08/01/2020		2,182		2,317				$		613,993
4.00%, 06/01/2026		3,713		3,983	Government National Mortgage Association (GNMA) -
4.00%, 11/01/2026 ⁽ⁱ⁾		3,350		3,555	6.18	%
4.00%, 01/01/2029		3,978		4,270	1.50%, 07/20/2043 ^(e)			1,731		1,754
4.00%, 02/01/2031		783		840	2.00%, 03/20/2043 ^(e)			359		369
4.00%, 03/01/2034		1,419		1,528	2.00%, 04/20/2043 ^(e)			2,207		2,258
4.00%, 04/01/2034		7,633		8,209	3.00%, 06/20/2043			6,432		6,562
4.00%, 12/01/2040		4,672		5,009	3.00%, 11/01/2044 ⁽ⁱ⁾			6,600		6,724
4.00%, 12/01/2040		9,632		10,321	3.00%, 11/01/2044			22,000		22,413
4.00%, 01/01/2041		7,199		7,689	3.50%, 11/01/2041 ⁽ⁱ⁾			24,200		25,272
4.00%, 11/01/2041 ⁽ⁱ⁾		109,755		116,529	3.50%, 03/15/2042			2,491		2,627
4.00%, 05/01/2043		883		947	3.50%, 04/15/2042			767		802
4.00%, 09/01/2043		436		466	3.50%, 04/15/2042			2,295		2,401
4.50%, 10/01/2019		4,811		5,069	3.50%, 10/15/2042			2,496		2,611
4.50%, 04/01/2024		3,330		3,607	3.50%, 06/15/2043			13,528		14,280
4.50%, 12/01/2039		103		112	3.50%, 08/15/2043			7,391		7,763
4.50%, 05/01/2040		2,151		2,346	3.50%, 11/01/2044			5,000		5,231
4.50%, 07/01/2040		1,409		1,542	4.00%, 10/15/2041			5,521		5,947
4.50%, 01/01/2041		1,904		2,086	4.00%, 11/01/2041 ⁽ⁱ⁾			25,000		26,730
4.50%, 09/01/2041		1,297		1,407	4.00%, 02/15/2042			2,067		2,226
4.50%, 11/01/2041 ⁽ⁱ⁾		23,000		24,926	4.00%, 05/20/2043			537		575
4.50%, 04/01/2044		4,834		5,250	4.00%, 11/01/2044			32,200		34,428
4.50%, 06/01/2044		31,120		33,810	4.50%, 06/20/2025			7,879		8,320
5.00%, 03/01/2018		130		138	4.50%, 09/15/2039			787		875


U.S. GOVERNMENT & GOVERNMENT		Principal			U.S. GOVERNMENT & GOVERNMENT			Principal
AGENCY OBLIGATIONS (continued)		Amount (000's)		Value (000's)	AGENCY OBLIGATIONS (continued)		Amount (000's)				Value (000's)
Government National Mortgage Association (GNMA)
(continued)					U.S. Treasury Inflation-Indexed Obligations - 0.45%
4.50%, 01/20/2040	$	3,355	$	3,674		0.13%, 07/15/2024	$	18,351		$	17,847
4.50%, 03/15/2040		7,987		8,739
4.50%, 08/20/2040		6,847		7,505	TOTAL U.S. GOVERNMENT & GOVERNMENT AGENCY
4.50%, 10/20/2040		2,593		2,843	OBLIGATIONS				$		1,380,589
4.50%, 04/15/2041		5,262		5,808	Total Investments				$		4,341,892
4.50%, 07/15/2041		2,689		2,940	Liabilities in Excess of Other Assets, Net - (9.94)%				$		(392,333	)
4.50%, 11/01/2041 ⁽ⁱ⁾		10,000		10,912	TOTAL NET ASSETS - 100.00%				$		3,949,559
4.50%, 01/20/2044		8,981		9,812
5.00%, 11/15/2033		3,957		4,408
5.00%, 06/15/2034		84		93	(a)	Non-Income Producing Security
5.00%, 10/20/2039		464		517	(b)	Security is Illiquid
5.00%, 07/20/2040		639		704	(c)	Fair value of these investments is determined in good faith by the Manager
5.00%, 09/20/2041		1,180		1,313		under procedures established and periodically reviewed by the Board of
5.50%, 10/15/2033		1,353		1,538		Directors. At the end of the period, the fair value of these securities totaled
5.50%, 05/20/2035		160		182		$12,530 or 0.32% of net assets.
5.50%, 02/15/2038		1,802		2,007	(d)	Security exempt from registration under Rule 144A of the Securities Act of
6.00%, 07/20/2028		67		76		1933. These securities may be resold in transactions exempt from
6.00%, 11/20/2028		58		66		registration, normally to qualified institutional buyers. Unless otherwise
6.00%, 01/20/2029		65		76		indicated, these securities are not considered illiquid. At the end of the
6.00%, 07/20/2029		13		15		period, the value of these securities totaled $795,608 or 20.14% of net
6.00%, 08/15/2031		42		47		assets.
6.00%, 01/15/2032		6		7	(e)	Variable Rate. Rate shown is in effect at October 31, 2014.
6.00%, 02/15/2032		66		76	(f)	Security purchased on a when-issued basis.
6.00%, 02/15/2033		52		60	(g)	Payment in kind; the issuer has the option of paying additional securities
6.00%, 12/15/2033		61		71		in lieu of cash.
6.50%, 03/20/2028		12		14	(h)	This Senior Floating Rate Note will settle after October 31, 2014, at which
6.50%, 05/20/2029		11		12		time the interest rate will be determined.
6.50%, 02/20/2032		5		6	(i)	Security was purchased in a "to-be-announced" ("TBA") transaction. See
6.50%, 10/15/2032		30		36		Notes to Financial Statements for additional information.
6.50%, 12/15/2032		142		163	(j)	Security or a portion of the security was pledged to cover margin
7.00%, 06/15/2031		22		26		requirements for swap and/or swaption contracts. At the end of the period,
7.00%, 07/15/2031		2		2		the value of these securities totaled $7,376 or 0.19% of net assets.
7.00%, 06/15/2032		151		178	(k)	Security or a portion of the security was pledged to cover margin
8.00%, 01/20/2031		7		9		requirements for futures contracts. At the end of the period, the value of
		$		244,103		these securities totaled $1,066 or 0.03% of net assets.
					(l)	Rate shown is the discount rate of the original purchase.
U.S. Treasury - 8.55%
0.25%, 01/31/2015		28,000		28,011
0.25%, 05/15/2015		700		700
0.50%, 09/30/2016		615		615		Portfolio Summary (unaudited)
0.75%, 06/30/2017		22,000		21,960	Sector						Percent
1.00%, 03/31/2017		37,300		37,565	Mortgage Securities						30.89	%
1.25%, 10/31/2015		35,165		35,544	Financial						15.07	%
1.38%, 12/31/2018 ^(j)		60,000		59,869	Asset Backed Securities						14.68	%
1.88%, 08/31/2017		22,925		23,552	Government						11.22	%
2.38%, 05/31/2018		75		78	Energy						7.01	%
2.38%, 08/15/2024		10,000		10,039	Communications						6.74	%
2.50%, 05/15/2024		4,500		4,572	Consumer, Non-cyclical						5.73	%
2.63%, 04/30/2016		350		362	Consumer, Cyclical						4.13	%
2.63%, 01/31/2018 ^(j)		10,000		10,490	Industrial						3.51	%
3.25%, 12/31/2016		150		158	Exchange Traded Funds						3.39	%
3.38%, 05/15/2044		1,250		1,326	Basic Materials						3.18	%
3.75%, 11/15/2043 ^(k)		37,000		41,978	Utilities						2.28	%
3.88%, 08/15/2040		11,970		13,894	Technology						1.93	%
4.00%, 02/15/2015		85		86	Diversified						0.18	%
4.38%, 05/15/2040		14,500		18,164	Liabilities in Excess of Other Assets, Net						(9.94	)%
4.50%, 02/15/2036		22,500		28,508	TOTAL NET ASSETS						100.00	%
4.75%, 02/15/2041		70		93
5.38%, 02/15/2031		25		34
		$		337,598

U.S. Treasury Bill - 1.29%
0.02%, 02/05/2015 ^(l)		40,600		40,598
0.04%, 02/12/2015 ^(l)		10,500		10,499
		$		51,097


Schedule of Investments
Bond & Mortgage Securities Fund
October 31, 2014


Credit Default Swaps

Buy Protection
				(Pay)/								Upfront			Unrealized
				Receive		Expiration						Premiums				Appreciation/		Fair Value
Counterparty (Issuer)	Reference Entity		Fixed Rate			Date		Notional Amount					Paid/(Received)			(Depreciation)		Asset		Liability
Barclays Bank PLC	CDX.EM.22			(1.00	)%	12/20/2019		$	34,000		$		2,537		$	(336	) $	2,201	$	—
Total										$			2,537		$	(336	) $	2,201	$	—

Amounts in thousands
Exchange Cleared Credit Default Swaps

Buy Protection
				(Pay)/
				Receive		Expiration									Unrealized Appreciation/
	Reference Entity		Fixed Rate			Date			Notional Amount				Fair Value			(Depreciation)
	CDX.NA.HY.23			(5.00	)%	12/20/2019		$	57,000		$	(3,982		)	$			(1,223			)
Total										$		(3,982		)	$			(1,223			)

Amounts in thousands


Foreign Currency Contracts

													Unrealized Appreciation/(Depreciation)
Counterparty		Delivery Date	Contracts to Accept				In Exchange For			Fair Value						Asset		Liability
Brown Brothers Harriman & Co		12/09/2014	CAD	670,826			$		599	$		593				$—				$(6	)
Brown Brothers Harriman & Co		12/09/2014	JPY	51,696,012					489			460				—				(29	)
Total																$—				$(35	)
													Unrealized Appreciation/(Depreciation)
Counterparty		Delivery Date	Contracts to Deliver				In Exchange For			Fair Value						Asset		Liability
Brown Brothers Harriman & Co		12/09/2014	AUD	301,741			$		264	$		265				$—				$(1	)
Brown Brothers Harriman & Co		12/09/2014	CAD	1,117,926					1,006			991				15				—
Brown Brothers Harriman & Co		12/09/2014	CHF	48,062					50			50				—				—
Brown Brothers Harriman & Co		12/09/2014	DKK	697,046					118			117				1				—
Brown Brothers Harriman & Co		12/09/2014	EUR	5,325,515					6,755	6,674						84				(3	)
Brown Brothers Harriman & Co		12/09/2014	GBP	780,623					1,253	1,248						6				(1	)
Brown Brothers Harriman & Co		12/09/2014	JPY	541,976,800					5,014	4,827						187				—
Brown Brothers Harriman & Co		12/09/2014	MXN	5,949,656					442			441				2				(1	)
Brown Brothers Harriman & Co		12/09/2014	PLN	376,309					114			112				2				—
Brown Brothers Harriman & Co		12/09/2014	SEK	808,844					114			110				4				—
Total																$301				$(6	)

Amounts in thousands except contracts


Futures Contracts

																				Unrealized
Type		Long/Short		Contracts			Notional Value									Fair Value		Appreciation/(Depreciation)
US 10 Year Note; December 2014			Short			182	$		22,863	$					22,998		$			(135	)
US 5 Year Note; December 2014			Short			750			89,040						89,572					(532	)
US Long Bond; December 2014			Short			47			6,569						6,631					(62	)
Total																$				(729	)

Amounts in thousands except contracts


Schedule of Investments
California Municipal Fund
October 31, 2014



		Principal				Principal
	MUNICIPAL BONDS - 97.29%	Amount (000's)		Value (000's)	MUNICIPAL BONDS (continued)	Amount (000's)	Value (000's)

	California - 92.97%				California (continued)
	Abag Finance Authority for Nonprofit Corps				City of San Francisco CA Public Utilities
	5.00%, 08/01/2043	$1,500	$	1,678	Commission Water Revenue
	Alum Rock Union Elementary School				5.00%, 11/01/2036	$2,010	$	2,315
	District				City of Torrance CA
	5.25%, 08/01/2043	1,000		1,147	6.00%, 06/01/2022	1,000		1,004
	Anaheim Public Financing Authority				City of Turlock CA
	5.25%, 10/01/2034	1,000		1,137	5.13%, 10/15/2031	1,000		1,132
	Baldwin Park Financing Authority				5.13%, 10/15/2037	1,000		1,132
	4.63%, 08/01/2016	770		787	City of Vernon CA Electric System Revenue
	Bay Area Governments Association (credit				5.13%, 08/01/2021	2,000		2,240
	support from XLCA)				Coachella Valley Unified School
	5.25%, 09/01/2029 ^(a)	130		130	District/CA (credit support from AGM)
	Bay Area Toll Authority				0.00%, 08/01/2039 ^(a),(d)	7,800		2,663
	5.13%, 04/01/2039	3,000		3,530	Dinuba Financing Authority
	California Educational Facilities Authority				5.38%, 09/01/2038	1,000		1,017
	5.00%, 01/01/2038 ^(b)	1,379		1,514	Dinuba Redevelopment Agency (credit
	5.00%, 10/01/2038 ^(b)	900		1,007	support from BAM)
	5.00%, 01/01/2039 ^(b)	3,642		4,063	5.00%, 09/01/2033 ^(a)	2,000		2,262
	5.25%, 10/01/2039 ^(b)	6,500		7,352	East Bay Municipal Utility District Water
	5.38%, 04/01/2034	1,000		1,148	System Revenue
	California Health Facilities Financing				5.00%, 06/01/2036	1,000		1,155
	Authority				El Monte Union High School District (credit
	4.00%, 03/01/2033	1,000		1,023	support from ASSURED GTY)
	5.75%, 09/01/2039	2,000		2,321	5.50%, 06/01/2034 ^(a)	2,000		2,266
	6.00%, 07/01/2039	2,000		2,338	Escondido Union High School District
	6.50%, 10/01/2038	985		1,202	0.00%, 08/01/2041 ^(d)	1,000		305
	6.50%, 10/01/2038	15		18	Fontana Redevelopment Agency (credit
	California Infrastructure & Economic				support from NATL-RE)
	Development Bank (credit support from				5.20%, 09/01/2030 ^(a)	1,000		1,002
	NATL ST INTERCEPT)				Foothill-De Anza Community College
	5.00%, 08/15/2018 ^(a)	500		518	District
	California Pollution Control Financing				5.00%, 08/01/2040	1,500		1,680
	Authority				Golden State Tobacco Securitization Corp
	5.00%, 07/01/2030 ^(c)	1,000		1,079	4.50%, 06/01/2027	6,000		5,610
	5.00%, 07/01/2037 ^(c)	4,000		4,271	5.00%, 06/01/2030	3,500		4,013
	California State Public Works Board				5.75%, 06/01/2047	2,000		1,625
	5.00%, 11/01/2037	1,375		1,567	Highland Redevelopment Agency (credit
	5.00%, 10/01/2039	4,500		5,085	support from AMBAC)
	California State University				5.00%, 12/01/2028 ^(a)	3,000		3,005
	5.25%, 11/01/2038	2,000		2,293	Indio Redevelopment Agency
	California State University (credit support				5.63%, 08/15/2035	1,355		1,416
	from AGM)				Inland Valley Development Agency
	5.00%, 11/01/2039 ^(a)	1,000		1,112	5.25%, 09/01/2037	1,000		1,139
	California Statewide Communities				La Verne Public Financing Authority
	Development Authority				7.25%, 09/01/2026	800		802
	7.25%, 11/15/2041	1,500		1,768	Lancaster Redevelopment Agency
	California Statewide Communities				6.88%, 08/01/2039	545		688
	Development Authority (credit support from				6.88%, 08/01/2039	455		532
	CA MTG INS)				Los Angeles County Public Works Financing
	6.25%, 08/15/2028 ^(a)	2,250		2,625	Authority
	California Statewide Communities				5.00%, 08/01/2042	1,400		1,557
	Development Authority (credit support from				Los Angeles Department of Water & Power
	FHA INS)				5.38%, 07/01/2038	1,000		1,144
	6.25%, 08/01/2024 ^(a)	810		976	Los Angeles Unified School District/CA
	California Statewide Financing Authority				5.00%, 07/01/2029	2,000		2,301
	6.00%, 05/01/2043	2,000		2,000	Los Angeles Unified School
	6.00%, 05/01/2043	1,550		1,534	District/CA (credit support from AGM)
	Carson Redevelopment Agency Successor				5.00%, 07/01/2032 ^(a)	1,000		1,093
	Agency (credit support from NATL-RE)				Merced Union High School District
	5.50%, 10/01/2016 ^(a)	1,000		1,090	0.00%, 08/01/2032 ^(d)	3,380		1,653
	City of Alhambra CA (credit support from				Metropolitan Water District of Southern
	NATL-RE)				California (credit support from AGM)
	6.13%, 09/02/2018 ^(a)	2,225		2,258	5.00%, 07/01/2035 ^(a)	1,250		1,286
	City of Bakersfield CA Wastewater				Morongo Band of Mission Indians/The
	Revenue (credit support from AGM)				6.50%, 03/01/2028 ^(c)	1,000		1,111
	5.00%, 09/15/2032 ^(a)	2,000		2,194	Needles Public Utility Authority
	City of Compton CA Water Revenue				6.50%, 02/01/2022	2,360		2,360
	6.00%, 08/01/2039	1,250		1,319	Norco Community Redevelopment Agency
	City of Irvine CA				Successor Agency (credit support from BAM)
	5.00%, 09/01/2049	1,000		1,107	5.00%, 03/01/2032 ^(a)	1,000		1,141
	City of Los Angeles Department of Airports
	5.13%, 05/15/2033	1,230		1,363


Schedule of Investments
California Municipal Fund
October 31, 2014



		Principal				Principal
MUNICIPAL BONDS (continued)		Amount (000's)	Value (000's)		MUNICIPAL BONDS (continued)	Amount (000's)		Value (000's)

California (continued)					California (continued)
Norco Financing Authority (credit support					San Joaquin Hills Transportation Corridor
from AGM)					Agency
5.63%, 10/01/2034 ^(a)	$	1,000	$	1,148	5.00%, 01/15/2034 ^(e)	$	2,000	$	2,175
Northern Inyo County Local Hospital District					San Luis Obispo County Financing
5.00%, 12/01/2029		1,010		1,030	Authority (credit support from AGM)
Ontario Redevelopment Financing					5.00%, 08/01/2030 ^(a)		1,000		1,105
Authority (credit support from AMBAC)					Santa Clara County Financing Authority
5.50%, 08/01/2016 ^(a)		1,055		1,059	5.25%, 05/15/2036		2,000		2,222
Ontario Redevelopment Financing					Santa Margarita Water District
Authority (credit support from NATL-RE)					5.00%, 09/01/2038		500		562
5.25%, 08/01/2016 ^(a)		1,060		1,063	Semitropic Improvement District
Palm Desert Financing Authority (credit					5.00%, 12/01/2038		2,000		2,272
support from NATL-RE)					Southern California Public Power Authority
5.00%, 08/01/2022 ^(a)		1,280		1,287	5.00%, 11/01/2029		1,105		1,261
Perris Public Financing Authority					5.25%, 07/01/2029		695		824
5.30%, 10/01/2026		2,805		2,809	5.25%, 07/01/2031		695		814
Pittsburg Unified School District					State of California
0.00%, 08/01/2036 ^(d)		1,365		503	5.00%, 02/01/2038		1,450		1,634
5.00%, 08/01/2043		2,900		3,229	5.00%, 04/01/2043		3,380		3,783
Pittsburg Unified School District (credit					5.25%, 11/01/2040		1,500		1,726
support from AGM)					5.75%, 04/01/2031		675		798
5.50%, 08/01/2031 ^(a)		1,000		1,135	6.00%, 03/01/2033		2,000		2,453
Pomona Public Financing Authority (credit					6.00%, 04/01/2038		3,000		3,595
support from NATL-RE)					State of California Department of Water
5.00%, 02/01/2021 ^(a)		5,000		5,011	Resources
Pomona Unified School District (credit					5.00%, 12/01/2028		1,680		1,910
support from NATL-RE)					Stockton East Water District (credit support
6.15%, 08/01/2030 ^(a)		1,000		1,232	from NATL)
Port Commission of the City & County of San					5.25%, 04/01/2022 ^(a)		1,780		1,783
Francisco					Stockton Unified School District (credit
4.00%, 03/01/2035		1,000		1,013	support from AGM)
Port of Los Angeles					5.00%, 08/01/2038 ^(a)		1,500		1,680
5.00%, 08/01/2032		1,740		2,018	Tobacco Securitization Authority of Southern
Poway Unified School District					California
0.00%, 08/01/2036 ^(d)		4,000		1,627	5.13%, 06/01/2046		1,500		1,121
Richmond Joint Powers Financing Authority					Tulare County Transportation Authority
6.25%, 07/01/2024		1,000		1,199	5.00%, 02/01/2029		1,000		1,190
Ripon Unified School District (credit support					Tustin Public Financing Authority
from BAM)					5.00%, 04/01/2041		1,000		1,100
0.00%, 08/01/2031 ^(a),(d)		945		417	University of California
0.00%, 08/01/2033 ^(a),(d)		1,110		433	5.00%, 05/15/2037		6,000		6,740
Riverside Community Properties Development					5.00%, 05/15/2044		1,000		1,141
Inc					5.25%, 05/15/2039 ^(b)		3,000		3,452
6.00%, 10/15/2038		1,000		1,193	Walnut Energy Center Authority
Riverside County Transportation					5.00%, 01/01/2035		1,225		1,343
Commission					Western Municipal Water District Facilities
5.00%, 06/01/2032		1,500		1,729	Authority
Rocklin Unified School District (credit					5.00%, 10/01/2034		1,700		1,925
support from NATL)							$		211,589
0.00%, 08/01/2019 ^(a),(d)		1,360		1,068
0.00%, 08/01/2020 ^(a),(d)		1,415		1,053	Puerto Rico - 4.32%
0.00%, 08/01/2023 ^(a),(d)		1,225		776	Government Development Bank for Puerto
Salinas Valley Solid Waste Authority (credit					Rico
support from AGM)					5.00%, 12/01/2014		6,595		6,552
5.50%, 08/01/2031 ^(a)		1,500		1,738	5.25%, 01/01/2015		3,300		3,267
San Bernardino County Redevelopment							$		9,819
Agency (credit support from RADIAN)					TOTAL MUNICIPAL BONDS		$		221,408
5.00%, 09/01/2018 ^(a)		1,565		1,612	Total Investments		$		221,408
San Diego Community College District					Liability for Floating Rate Notes Issued in Conjunction with
5.25%, 08/01/2033 ^(b)		1,950		2,258	Securities Held - (4.72)%
San Diego Public Facilities Financing					Notes with interest rates of 0.06% and 0.07%	$	(10,739	) $	(10,739	)
Authority Water Revenue					at October 31, 2014 and contractual maturity
5.38%, 08/01/2034		2,000		2,329	of collateral of 2017.^(f)
San Diego Redevelopment Agency					Total Net Investments		$		210,669
6.40%, 09/01/2019		1,000		1,004	Other Assets in Excess of Liabilities, Net - 7.43%		$		16,898
San Francisco Bay Area Rapid Transit					TOTAL NET ASSETS - 100.00%		$		227,567
District
5.00%, 07/01/2028		1,755		2,034
San Francisco City & County Redevelopment					(a) Credit support indicates investments that benefit from credit enhancement
Agency					or liquidity support provided by a third party bank, institution, or
5.00%, 08/01/2044		1,500		1,600	government agency.
6.50%, 08/01/2039		1,000		1,170


Schedule of Investments
Diversified International Fund
October 31, 2014



COMMON STOCKS - 97.11%	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Advertising - 0.41%				Chemicals (continued)
WPP PLC	1,152,608	$	22,513	Yara International ASA	551,669	$	25,333
					$		64,732

Aerospace & Defense - 1.14%				Commercial Services - 1.83%
Airbus Group NV	423,237		25,268	Ashtead Group PLC	1,119,477		18,756
Safran SA	397,931		25,202	Cielo SA	667,900		10,968
Thales SA	251,011		12,465	G8 Education Ltd	2,266,590		10,015
	$		62,935	Kroton Educacional SA	4,585,200		32,679
				Stantec Inc	231,478		14,666
Agriculture - 2.16%				TAL Education Group ADR ^(a)	433,715		13,775
British American Tobacco PLC	818,670		46,400		$		100,859
ITC Ltd	362,203		2,094
Japan Tobacco Inc	1,536,500		52,424	Computers - 0.72%
KT&G Corp	203,175		17,990	Cap Gemini SA	294,196		19,357
	$		118,908	Ingenico	206,206		20,543
					$		39,900
Airlines - 0.83%
easyJet PLC	1,162,509		27,934	Cosmetics & Personal Care - 0.04%
Ryanair Holdings PLC ADR^(a)	318,300		17,678	Svenska Cellulosa AB SCA	96,608		2,165
	$		45,612

Automobile Manufacturers - 2.15%				Distribution & Wholesale - 0.94%
Fuji Heavy Industries Ltd	1,026,000		34,149	Hitachi High-Technologies Corp	583,800		17,835
Toyota Motor Corp	1,401,800		84,356	Mitsui & Co Ltd	2,241,200		33,840
	$		118,505		$		51,675

Automobile Parts & Equipment - 1.73%				Diversified Financial Services - 2.09%
Bridgestone Corp	821,100		27,439	Macquarie Group Ltd	611,836		33,066
Continental AG	156,736		30,872	Mega Financial Holding Co Ltd	19,085,128		15,829
Georg Fischer AG ^(a)	14,561		8,410	ORIX Corp	3,049,010		42,321
Valeo SA	257,948		28,924	Paragon Group of Cos PLC/The	1,524,644		8,832
	$		95,645	Shinhan Financial Group Co Ltd	321,589		15,136
					$		115,184
Banks - 12.64%
Alpha Bank AE ^(a)	17,702,191		11,540	Electric - 2.81%
Axis Bank Ltd ^(b)	2,446,005		17,771	Enel SpA	8,060,538		41,188
Bangkok Bank PCL	1,659,100		10,289	Iberdrola SA	6,243,482		44,197
Bank of China Ltd	42,159,300		20,180	Korea Electric Power Corp	646,047		28,359
Bank of Georgia Holdings PLC	254,018		10,418	Tenaga Nasional BHD	10,195,700		41,423
Bank of Montreal	552,600		40,073		$		155,167
Commonwealth Bank of Australia	725,217		51,570	Electrical Components & Equipment - 0.80%
Danske Bank A/S	729,795		20,040	Delta Electronics Inc	2,171,000		13,024
DBS Group Holdings Ltd	1,712,003		24,628	Hitachi Ltd	3,985,639		31,317
DNB ASA	2,584,643		47,486
ICICI Bank Ltd ADR	621,635		35,035		$		44,341
Malayan Banking Bhd	6,504,800		19,190	Electronics - 2.52%
Mitsubishi UFJ Financial Group Inc	6,516,825		37,988	Hon Hai Precision Industry Co Ltd	9,913,120		31,375
Natixis SA	5,023,831		34,581	Hoya Corp	941,700		33,324
Nordea Bank AB	3,869,053		49,763	Japan Aviation Electronics Industry Ltd	460,200		9,118
Royal Bank of Canada	708,600		50,304	Merry Electronics Co Ltd	2,130,450		8,616
Skandinaviska Enskilda Banken AB	3,428,497		44,037	Minebea Co Ltd	881,985		12,085
Sumitomo Mitsui Financial Group Inc	1,317,200		53,719	Omron Corp	935,400		44,277
Svenska Handelsbanken AB	722,609		34,545		$		138,795
Swedbank AB	1,241,839		32,910
Toronto-Dominion Bank/The	1,031,500		50,767	Engineering & Construction - 1.63%
				Acciona SA ^(a)	137,519		9,611
	$		696,834
				ACS Actividades de Construccion y Servicios	603,750		22,410
Beverages - 2.09%				SA
AMBEV SA ADR	3,167,491		21,159	Promotora y Operadora de Infraestructura	793,300		10,943
Anheuser-Busch InBev NV	603,719		66,949	SAB de CV ^(a)
Asahi Group Holdings Ltd	603,800		18,729	Skanska AB	641,540		13,077
Britvic PLC	780,989		8,515	Vinci SA	590,894		33,727
	$		115,352		$		89,768

Biotechnology - 0.52%				Entertainment - 0.23%
CSL Ltd	404,268		28,543	OPAP SA	1,067,291		12,930


Building Materials - 0.40%				Food - 2.64%
CSR Ltd	4,331,726		13,258	Aryzta AG ^(a)	301,986		25,760
Kingspan Group PLC	546,390		8,604	Associated British Foods PLC	454,741		20,069
	$		21,862	Greencore Group PLC	2,589,608		10,866
				Gruma SAB de CV ^(a)	1,203,600		13,222
Chemicals - 1.17%
Givaudan SA ^(a)	17,994		30,050	Nestle SA	699,993		51,333
Lonza Group AG ^(a)	84,849		9,349	Saputo Inc	628,200		17,825
				X5 Retail Group NV ^(a)	350,498		6,424
					$		145,499


Schedule of Investments
Diversified International Fund
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Forest Products & Paper - 0.67%				Mining - 1.28%
Mondi PLC	1,025,277	$	17,328	BHP Billiton Ltd	1,292,047	$	38,654
Stora Enso OYJ	2,381,301		19,665	BHP Billiton PLC	1,234,922		31,906
	$		36,993		$		70,560

Gas - 0.83%				Miscellaneous Manufacturing - 0.93%
Gas Natural SDG SA	1,124,128		32,461	FUJIFILM Holdings Corp	611,600		20,531
Keyera Corp	164,700		13,102	IMI PLC	655,740		12,841
	$		45,563	Largan Precision Co Ltd	257,000		18,054

Hand & Machine Tools - 0.20%					$		51,426
Fuji Electric Co Ltd	2,568,000		11,282	Office & Business Equipment - 0.51%
				Seiko Epson Corp	611,800		28,390

Healthcare - Products - 1.11%
Coloplast A/S	589,466		51,378	Oil & Gas - 5.95%
Sonova Holding AG	64,199		10,011	Canadian Natural Resources Ltd	1,518,000		52,973
	$		61,389	Parex Resources Inc ^(a)	887,500		8,134
				PetroChina Co Ltd	21,918,000		27,440
Healthcare - Services - 0.32%				Royal Dutch Shell PLC - A Shares	1,051,769		37,571
Ramsay Health Care Ltd	384,364		17,769	Royal Dutch Shell PLC - B Shares	1,447,431		53,476
				Sasol Ltd	677,146		33,813
Home Builders - 1.50%				SK Holdings Co Ltd	67,720		10,615
Barratt Developments PLC	3,902,287		26,233	Statoil ASA	1,043,358		23,878
Persimmon PLC ^(a)	1,119,660		26,295	Suncor Energy Inc	1,028,900		36,535
Taylor Wimpey PLC	15,979,049		30,353	Total SA	736,463		43,969
	$		82,881		$		328,404

Home Furnishings - 0.53%				Packaging & Containers - 0.25%
Howden Joinery Group PLC	1,905,713		10,456	Rexam PLC	1,846,807		14,076
Steinhoff International Holdings Ltd	3,654,316		18,695
	$		29,151	Pharmaceuticals - 8.23%
Insurance - 5.93%				Actelion Ltd ^(a)	156,091		18,590
Allianz SE	263,683		41,931	Bayer AG	490,794		70,194
BB Seguridade Participacoes SA	1,506,600		20,101	BTG PLC ^(a)	1,361,953		16,463
Direct Line Insurance Group PLC	6,195,138		27,405	Grifols SA	31,775		1,298
Hannover Rueck SE	488,868		40,805	Novartis AG	1,136,574		105,477
Legal & General Group PLC	7,645,049		28,335	Novo Nordisk A/S	1,589,015		71,828
Manulife Financial Corp	1,162,000		22,053	Orion OYJ	290,468		9,879
Porto Seguro SA	551,683		6,612	Roche Holding AG	406,471		119,950
Prudential PLC	2,124,676		49,199	Shire PLC	597,406		40,084
Sampo Oyj	1,039,155		49,794		$		453,763
Sanlam Ltd	2,885,748		18,235	Real Estate - 4.33%
Standard Life PLC	251,993		1,591	Brookfield Asset Management Inc	1,517,858		74,300
Tokio Marine Holdings Inc	649,600		20,832	Cheung Kong Holdings Ltd	3,296,000		58,512
	$		326,893	Deutsche Wohnen AG	455,092		10,272
Internet - 0.93%				GAGFAH SA ^(a)	578,779		10,824
Tencent Holdings Ltd	2,235,000		35,922	Lend Lease Group	1,703,715		23,762
Vipshop Holdings Ltd ADR ^(a)	65,988		15,130	Mitsui Fudosan Co Ltd	922,000		29,657
	$		51,052	Sun Hung Kai Properties Ltd	1,494,000		22,292
				Wheelock & Co Ltd	1,937,000		9,337
Investment Companies - 0.45%					$		238,956
Investor AB	684,127		24,555
				REITS - 0.70%
				Mirvac Group	9,776,408		15,511
Iron & Steel - 0.17%				RioCan Real Estate Investment Trust	496,600		11,698
APERAM ^(a)	318,212		9,156
				Segro PLC	1,841,305		11,218
					$		38,427

Machinery - Construction & Mining - 0.75%				Retail - 3.98%
Mitsubishi Electric Corp	3,216,000		41,466	Alimentation Couche-Tard Inc	2,014,217		68,359
				Cie Financiere Richemont SA	39,809		3,356
Machinery - Diversified - 0.25%				Dollarama Inc	526,400		46,248
Sumitomo Heavy Industries Ltd	2,488,000		13,640	E-Mart Co Ltd	45,779		8,494
				Jumbo SA	560,016		6,141
				Next PLC	257,847		26,619
Media - 1.61%				Pandora A/S	459,291		38,724
Grupo Televisa SAB ADR	556,037		20,095	Poundland Group PLC ^(a)	2,160,825		10,935
ITV PLC	15,102,766		49,064	Travis Perkins PLC	392,778		10,407
Shaw Communications Inc	756,600		19,428		$		219,283
	$		88,587
				Semiconductors - 2.52%
Metal Fabrication & Hardware - 0.26%				ams AG	395,175		14,171
Catcher Technology Co Ltd	1,699,000		14,343	ARM Holdings PLC	1,931,687		27,347
				Dialog Semiconductor PLC ^(a)	337,460		11,653
				Everlight Electronics Co Ltd	124,000		235


Schedule of Investments
Diversified International Fund
October 31, 2014



COMMON STOCKS (continued)		Shares Held	Value(000			's)	Portfolio Summary (unaudited)
							Country	Percent
Semiconductors (continued)							Japan	16.53	%
MediaTek Inc		1,091,000		$	15,583
SK Hynix Inc ^(a)		671,027			29,924		Canada	11.61	%
Taiwan Semiconductor Manufacturing Co Ltd		9,210,544			39,927		United Kingdom	10.58	%
							Switzerland	6.93	%
			$		138,840		France	5.30	%
Shipbuilding - 0.20%							Australia	4.78	%
Mitsui Engineering & Shipbuilding Co Ltd		5,141,000			11,176		Germany	4.08	%
							Denmark	3.87	%
							Sweden	3.66	%
Software - 1.11%							Taiwan, Province Of China	2.85	%
HCL Technologies Ltd		1,132,227			29,696		United States	2.67	%
Tech Mahindra Ltd		353,145			14,477		Korea, Republic Of	2.50	%
UBISOFT Entertainment ^(a)		936,554			16,957
							China	2.45	%
			$		61,130		Brazil	2.04	%
Telecommunications - 7.08%							Spain	1.99	%
Belgacom SA		799,812			30,208		India	1.79	%
Bezeq The Israeli Telecommunication Corp		2,832,891			4,842		Belgium	1.76	%
Ltd							Norway	1.75	%
BT Group PLC		8,744,723			51,553		Netherlands	1.65	%
China Telecom Corp Ltd		34,230,000			21,820		Hong Kong	1.63	%
Freenet AG		86,465			2,269		South Africa	1.59	%
Hellenic Telecommunications Organization		896,919			10,130		Finland	1.44	%
SA ^(a)							Ireland	1.41	%
KDDI Corp		978,100			64,231		Malaysia	1.34	%
Nippon Telegraph & Telephone Corp		906,676			56,412		Mexico	0.81	%
NTT DOCOMO Inc		1,400,700			23,624		Italy	0.75	%
Orange SA		1,970,176			31,366		Greece	0.73	%
SK Telecom Co Ltd		110,022			27,571		Singapore	0.45	%
SoftBank Corp		735,700			53,559		Luxembourg	0.37	%
Telekom Malaysia Bhd		5,986,800			13,108		Austria	0.26	%
			$		390,693		Thailand	0.19	%
							Georgia	0.19	%
Transportation - 3.04%							Russian Federation	0.12	%
AP Moeller - Maersk A/S - B shares		13,764			32,119		Israel	0.09	%
Canadian National Railway Co		945,500			66,660		Liabilities in Excess of Other Assets, Net	(0.16	)%
Canadian Pacific Railway Ltd		225,900			46,988		TOTAL NET ASSETS	100.00	%
Deutsche Post AG		564,870			17,788
Seino Holdings Co Ltd		520,000			4,077
			$		167,632
TOTAL COMMON STOCKS			$		5,355,200
INVESTMENT COMPANIES - 2.67%		Shares Held	Value(000			's)

Publicly Traded Investment Fund - 2.67%
Cash Account Trust - Government & Agency		147,497,450			147,497
Portfolio - DWS Government Cash

TOTAL INVESTMENT COMPANIES			$		147,497
PREFERRED STOCKS - 0.38%		Shares Held	Value(000			's)

Food - 0.38%
Cia Brasileira de Distribuicao		497,400			20,857

TOTAL PREFERRED STOCKS			$		20,857
Total Investments			$		5,523,554
Liabilities in Excess of Other Assets, Net - (0.16)%			$		(8,913	)
TOTAL NET ASSETS - 100.00%			$		5,514,641


(a)	Non-Income Producing Security
(b)	Fair value of these investments is determined in good faith by the Manager
	under procedures established and periodically reviewed by the Board of
	Directors. At the end of the period, the fair value of these securities totaled
	$17,771 or 0.32% of net assets.


Schedule of Investments
Equity Income Fund
October 31, 2014



COMMON STOCKS - 97.54%	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Aerospace & Defense - 2.27%				Healthcare - Products - 1.86%
Lockheed Martin Corp	361,008	$	68,797	Becton Dickinson and Co	332,782	$	42,829
Raytheon Co	642,612		66,755	Medtronic Inc	1,005,548		68,538
	$		135,552		$		111,367

Apparel - 1.30%				Insurance - 6.29%
VF Corp	1,150,112		77,840	ACE Ltd	1,127,248		123,208
				Allstate Corp/The	1,037,466		67,280
				Chubb Corp/The	389,854		38,736
Automobile Manufacturers - 1.09%				MetLife Inc	2,376,389		128,895
PACCAR Inc	999,973		65,318	Swiss Re AG ADR	225,473		18,209
					$		376,328

Automobile Parts & Equipment - 2.06%				Machinery - Diversified - 1.97%
Autoliv Inc	623,258		57,178	Deere & Co	1,375,979		117,701
Johnson Controls Inc	1,404,300		66,353
	$		123,531
				Media - 0.50%
Banks - 8.99%				Walt Disney Co/The	330,165		30,170
Australia & New Zealand Banking Group Ltd	628,950		18,567
ADR
Bank of Nova Scotia/The	903,319		55,373	Mining - 1.06%
Grupo Financiero Santander Mexico SAB de	1,586,026		21,094	BHP Billiton Ltd ADR	1,064,750		63,289
CV ADR
JP Morgan Chase & Co	1,993,138		120,545	Miscellaneous Manufacturing - 1.76%
M&T Bank Corp	430,369		52,583	3M Co	209,390		32,198
PNC Financial Services Group Inc/The	1,153,096		99,616	Parker-Hannifin Corp	577,243		73,327
US Bancorp/MN	1,828,969		77,914		$		105,525
Wells Fargo & Co	1,734,469		92,083
	$		537,775	Oil & Gas - 11.30%
				Chevron Corp	655,404		78,616
Beverages - 0.70%				Crescent Point Energy Corp	2,420,911		80,013
Coca-Cola Co/The	1,002,330		41,978	Exxon Mobil Corp	898,552		86,899
				Marathon Oil Corp	1,516,698		53,691
Chemicals - 1.23%				Marathon Petroleum Corp	1,325,260		120,466
Air Products & Chemicals Inc	229,356		30,885	Occidental Petroleum Corp	1,228,790		109,276
EI du Pont de Nemours & Co	615,499		42,562	Royal Dutch Shell PLC - B shares ADR	1,337,398		99,864
	$		73,447	Total SA ADR	795,062		47,616
					$		676,441
Computers - 3.89%
Apple Inc	1,310,058		141,486	Pharmaceuticals - 13.37%
EMC Corp/MA	2,288,484		65,748	Abbott Laboratories	1,976,275		86,146
International Business Machines Corp	156,800		25,778	AbbVie Inc	1,381,716		87,684
	$		233,012	GlaxoSmithKline PLC ADR	1,473,384		67,024
				Johnson & Johnson	594,834		64,111
Distribution & Wholesale - 1.06%				Merck & Co Inc	2,157,583		125,011
Genuine Parts Co	655,084		63,596	Novartis AG ADR	781,950		72,479
				Pfizer Inc	3,295,237		98,692
Diversified Financial Services - 5.31%				Roche Holding AG ADR	2,320,898		85,432
BlackRock Inc	344,008		117,345	Shire PLC ADR	134,900		26,953
Discover Financial Services	1,576,841		100,571	Teva Pharmaceutical Industries Ltd ADR	1,530,350		86,419
FNF Group	3,342,169		99,730		$		799,951
	$		317,646	Pipelines - 3.07%
Electric - 3.71%				Enterprise Products Partners LP	2,103,357		77,614
NextEra Energy Inc	646,043		64,746	Kinder Morgan Energy Partners LP	309,138		28,997
Northeast Utilities	1,028,593		50,761	Kinder Morgan Inc/DE	1,983,781		76,772
Wisconsin Energy Corp	1,052,919		52,288		$		183,383
Xcel Energy Inc	1,620,217		54,229	Private Equity - 1.31%
	$		222,024	KKR & Co LP	3,641,357		78,508
Electrical Components & Equipment - 0.40%
Emerson Electric Co	368,724		23,620	REITS - 4.20%
				American Capital Agency Corp	2,743,458		62,386
Electronics - 1.06%				Annaly Capital Management Inc	5,922,429		67,575
Garmin Ltd	404,852		22,461	Digital Realty Trust Inc	1,762,970		121,627
Honeywell International Inc	428,819		41,218		$		251,588
	$		63,679	Retail - 2.26%
Food - 3.08%				Costco Wholesale Corp	191,817		25,583
Kraft Foods Group Inc	1,018,263		57,379	McDonald's Corp	285,053		26,718
Kroger Co/The	2,280,659		127,056	Starbucks Corp	382,600		28,909
	$		184,435	Tiffany & Co	559,959		53,823
					$		135,033
Gas - 1.09%
Sempra Energy	590,607		64,967	Semiconductors - 4.19%
				Applied Materials Inc	3,089,549		68,248


				Schedule of Investments
				Equity Income Fund
				October 31, 2014


COMMON STOCKS (continued)	Shares Held	Value(000			's)

Semiconductors (continued)
Maxim Integrated Products Inc	1,475,721		$	43,298
Microchip Technology Inc	1,873,430			80,763
Taiwan Semiconductor Manufacturing Co Ltd	2,665,073			58,685
ADR
		$		250,994

Software - 0.85%
Microsoft Corp	1,079,989			50,705


Telecommunications - 1.86%
BCE Inc	1,707,621			75,938
Verizon Communications Inc	707,402			35,547
		$		111,485

Toys, Games & Hobbies - 2.37%
Hasbro Inc	1,665,603			95,822
Mattel Inc	1,477,451			45,905
		$		141,727

Transportation - 2.08%
Norfolk Southern Corp	444,496			49,179
Union Pacific Corp	308,738			35,953
United Parcel Service Inc	372,550			39,084
		$		124,216
TOTAL COMMON STOCKS		$		5,836,831
INVESTMENT COMPANIES - 2.31%	Shares Held	Value(000			's)

Publicly Traded Investment Fund - 2.31%
Morgan Stanley Institutional Liquidity Funds -	138,014,985			138,015
Government Portfolio

TOTAL INVESTMENT COMPANIES		$		138,015
Total Investments		$		5,974,846
Other Assets in Excess of Liabilities, Net - 0.15%		$		9,117
TOTAL NET ASSETS - 100.00%		$		5,983,963




Portfolio Summary (unaudited)
Sector				Percent
Financial				26.10	%
Consumer, Non-cyclical				19.01	%
Energy				14.37	%
Consumer, Cyclical				10.14	%
Industrial				9.54	%
Technology				8.93	%
Utilities				4.80	%
Communications				2.36	%
Exchange Traded Funds				2.31	%
Basic Materials				2.29	%
Other Assets in Excess of Liabilities, Net				0.15	%
TOTAL NET ASSETS				100.00	%


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



COMMON STOCKS - 31.07%	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Aerospace & Defense - 0.49%				Distribution & Wholesale (continued)
BBA Aviation PLC	3,157,192	$	17,872	Mitsui & Co Ltd	722,600	$	10,911
L-3 Communications Holdings Inc	136,349		16,561		$		25,348
Lockheed Martin Corp	63,091		12,023	Diversified Financial Services - 0.32%
Raytheon Co	20,869		2,168	Aircastle Ltd	87,174		1,663
	$		48,624	Arlington Asset Investment Corp	51,096		1,399
Agriculture - 0.28%				Coronation Fund Managers Ltd	132,135		1,144
Altria Group Inc	241,891		11,693	Home Loan Servicing Solutions Ltd	88,799		1,706
Imperial Tobacco Group PLC	368,973		16,029	Ichiyoshi Securities Co Ltd	65,100		772
	$		27,722	Kyokuto Securities Co Ltd	53,900		911
				Macquarie Group Ltd	132,139		7,141
Airlines - 0.01%				ORIX Corp	917,300		12,732
Air New Zealand Ltd	656,618		1,039	Tokai Tokyo Financial Holdings Inc	229,700		1,558
Global Aviation Holdings Inc ^(a),(b),(c)	254,946		—	Urban & Civic PLC ^(a)	646,938		2,316
	$		1,039		$		31,342

Banks - 1.34%				Electric - 4.97%
Banca Generali SpA	62,861		1,668	AES Corp/VA	732,135		10,301
Bank Negara Indonesia Persero Tbk PT	8,230,500		4,057	Alliant Energy Corp	91,450		5,662
Bank of Montreal	134,744		9,771	Ameren Corp	61,714		2,613
Commonwealth Bank of Australia	159,362		11,332	AusNet Services	3,133,233		3,788
FirstRand Ltd	2,239,327		9,592	Avista Corp	293,551		10,406
Huntington Bancshares Inc/OH	506,223		5,017	China Power International Development Ltd	5,720,000		2,584
JP Morgan Chase & Co ^(d)	107,863		6,524	Dominion Resources Inc/VA	355,000		25,311
KeyCorp	336,927		4,447	DTE Energy Co ^(d)	310,000		25,470
Natixis SA	897,283		6,176	DUET Group	8,498,234		18,395
Royal Bank of Canada	225,074		15,978	Duke Energy Corp	435,200		35,752
Skandinaviska Enskilda Banken AB	587,738		7,549	E.ON SE	497,035		8,569
Sumitomo Mitsui Financial Group Inc	306,100		12,484	Entergy Corp ^(d)	200,000		16,804
Susquehanna Bancshares Inc	104,798		1,028	Exelon Corp	982,184		35,938
Toronto-Dominion Bank/The	286,800		14,115	FirstEnergy Corp	334,494		12,490
Wells Fargo & Co ^(d)	377,934		20,065	Hera SpA	485,943		1,280
Westpac Banking Corp	106,178		3,259	Huadian Power International Corp Ltd	2,266,000		1,731
	$		133,062	Iberdrola SA	2,976,811		21,073
Beverages - 0.10%				Infraestructura Energetica Nova SAB de CV	46,500		284
				Integrys Energy Group Inc ^(d)	160,000		11,629
Dr Pepper Snapple Group Inc	143,482		9,936
				Iren SpA	600,875		726
				ITC Holdings Corp ^(d)	1,003,202		39,737
Biotechnology - 0.03%				NextEra Energy Inc ^(d)	240,000		24,053
PDL BioPharma Inc	291,135		2,483	Northeast Utilities ^(d)	497,658		24,559
				NRG Yield Inc	50,000		2,498
Building Materials - 0.01%				PG&E Corp	420,645		21,167
CSR Ltd	324,479		993	PGE SA	1,337,951		8,778
				Pinnacle West Capital Corp ^(d)	125,000		7,684
				Portland General Electric Co	200,000		7,282
Chemicals - 0.24%				Power Assets Holdings Ltd	638,500		6,165
China Sanjiang Fine Chemicals Co Ltd	1,802,000		894	PPL Corp ^(d)	1,101,914		38,556
Grand Pacific Petrochemical	1,027,000		492	Public Service Enterprise Group Inc	146,233		6,041
Potash Corp of Saskatchewan Inc	383,700		13,097	SCANA Corp ^(d)	410,000		22,505
Toagosei Co Ltd	303,000		1,324	SSE PLC	1,118,195		28,660
Yara International ASA	165,153		7,584	TECO Energy Inc	150,000		2,941
	$		23,391	Westar Energy Inc	73,116		2,764
Commercial Services - 1.07%					$		494,196
Abertis Infraestructuras SA	610,709		12,735	Electrical Components & Equipment - 0.01%
ABM Industries Inc	50,153		1,386	Kung Long Batteries Industrial Co Ltd	306,000		1,029
Atlantia SpA	1,328,028		31,364
CCR SA	928,000		6,910
G8 Education Ltd	306,924		1,356	Electronics - 0.12%
Jiangsu Expressway Co Ltd	8,392,000		9,374	Boardtek Electronics Corp	808,000		997
				Delta Electronics Thailand PCL ^(c)	536,100		1,064
RR Donnelley & Sons Co	111,342		1,943
Transurban Group	5,839,793		41,824	Hu Lane Associate Inc	456,000		1,596
	$		106,892	Omron Corp	181,400		8,587
					$		12,244
Computers - 0.26%
Lenovo Group Ltd	8,758,000		12,909	Energy - Alternate Sources - 0.03%
Lexmark International Inc	237,481		10,250	NextEra Energy Partners LP	5,000		183
Seagate Technology PLC	22,522		1,415	Pattern Energy Group Inc	96,421		2,775
Tieto OYJ	50,941		1,292		$		2,958
	$		25,866	Engineering & Construction - 0.65%
Distribution & Wholesale - 0.25%				ACS Actividades de Construccion y Servicios	287,586		10,674
ITOCHU Corp	869,600		10,512	SA
Marubeni Corp	610,500		3,925	Alion Science and Technology Corp -	7,750		—
				Warrants ^(a),(b),(c)
				Boskalis Westminster NV	72,835		3,886


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Engineering & Construction (continued)				Insurance (continued)
Ferrovial SA	67,814	$	1,386	Powszechny Zaklad Ubezpieczen SA	58,522	$	8,781
Flughafen Zuerich AG ^(b)	11,957		7,619	Prudential Financial Inc	44,000		3,896
Fraport AG Frankfurt Airport Services	174,108		10,788	Sanlam Ltd	1,466,771		9,269
Worldwide				Sun Life Financial Inc	168,700		6,001
Grupo Aeroportuario del Centro Norte Sab de	250,500		1,243	Travelers Cos Inc/The	86,765		8,746
CV ^(a)				Validus Holdings Ltd	61,793		2,458
NCC AB	334,454		9,838	Zurich Insurance Group AG ^(a)	32,123		9,721
Vinci SA	342,809		19,567		$		97,692

	$		65,001	Investment Companies - 0.06%
Entertainment - 0.03%				Apollo Investment Corp	174,505		1,440
GTECH SpA	47,053		1,097	Medley Capital Corp	113,597		1,320
Regal Entertainment Group	88,270		1,955	New Mountain Finance Corp	99,794		1,465
	$		3,052	TICC Capital Corp	160,025		1,403

Food - 0.06%					$		5,628
Kesko OYJ	64,768		2,456	Leisure Products & Services - 0.02%
Marine Harvest ASA	92,645		1,312	Ardent Leisure Group	700,000		1,917
Metcash Ltd	434,191		1,085

Nutrisystem Inc	91,851		1,547	Leisure Time - 0.05%
	$		6,400	Travelport Worldwide Ltd ^(a),(b)	333,027		4,812
Forest Products & Paper - 0.04%
Mondi PLC	79,479		1,343	Machinery - Construction & Mining - 0.04%
Stora Enso OYJ	161,881		1,337	Mitsubishi Electric Corp	274,000		3,533
Western Forest Products Inc	516,600		1,063
	$		3,743
				Media - 0.31%
Gas - 1.47%				Charter Communications Inc ^(a)	17,000		2,692
AGL Resources Inc	42,809		2,308	HMH Holdings Inc ^(a)	360,119		7,206
Atmos Energy Corp	184,639		9,786	Liberty Global PLC - C Shares ^(a)	10,000		445
ENN Energy Holdings Ltd	522,000		3,387	Shaw Communications Inc	395,700		10,161
Gas Natural SDG SA	216,568		6,254	Time Warner Cable Inc	70,000		10,305
National Grid PLC ADR ^(d)	115,000		8,555
					$		30,809
National Grid PLC	2,998,922		44,503
NiSource Inc ^(d)	260,499		10,957	Mining - 0.27%
ONE Gas Inc	150,000		5,692	BHP Billiton Ltd	326,823		9,777
Rubis SCA	367,607		21,630	Boliden AB	389,457		6,437
Sempra Energy	115,000		12,650	Mirabela Nickel Ltd ^(a)	26,307,311		1,690
Snam SpA	2,311,965		12,502	Rio Tinto Ltd	176,252		9,412
South Jersey Industries Inc ^(d)	12,500		733		$		27,316
Vectren Corp	36,203		1,627
Western Gas Equity Partners LP ^(b),(d)	98,577		6,084	Miscellaneous Manufacturing - 0.14%
				Siemens AG	72,471		8,174
	$		146,668	SPX Corp	56,888		5,393
Healthcare - Products - 0.02%					$		13,567
Fisher & Paykel Healthcare Corp Ltd	372,448		1,628	Office & Business Equipment - 0.10%
				Seiko Epson Corp	32,700		1,518
Healthcare - Services - 0.11%				Xerox Corp	598,733		7,951
HealthSouth Corp	121,985		4,920		$		9,469
Select Medical Holdings Corp	92,025		1,327
WellPoint Inc	37,950		4,808	Office Furnishings - 0.01%
	$		11,055	Steelcase Inc	75,292		1,334

Holding Companies - Diversified - 0.24%
Cengage Learning Holdings II LP ^(a)	34,465		965	Oil & Gas - 1.56%
				Baytex Energy Corp	27,600		843
China Merchants Holdings International Co	7,148,000		22,595	Bonterra Energy Corp	37,349		1,679
Ltd				BP PLC ADR	80,000		3,477
	$		23,560	Chevron Corp ^(d)	102,795		12,330
Home Builders - 0.14%				ConocoPhillips ^(d)	302,791		21,846
Berkeley Group Holdings PLC	57,296		2,096	Eni SpA	365,248		7,782
Galliford Try PLC	51,519		1,008	Exxon Mobil Corp ^(d)	190,942		18,466
Iida Group Holdings Co Ltd	138,700		1,541	Hess Corp	13,000		1,103
Persimmon PLC ^(a)	397,088		9,326	Marathon Oil Corp	261,209		9,247
	$		13,971	Occidental Petroleum Corp	50,000		4,446
				PBF Energy Inc	375,181		9,781
Insurance - 0.98%				Royal Dutch Shell PLC ADR	100,000		7,179
AXA SA	673,005		15,545	Royal Dutch Shell PLC - A Shares	203,592		7,273
Beazley PLC	376,266		1,580	Royal Dutch Shell PLC - B Shares	442,138		16,335
Challenger Ltd/Australia	215,797		1,327	Statoil ASA	377,358		8,636
Direct Line Insurance Group PLC	1,771,790		7,838	Total SA	149,297		8,914
Hannover Rueck SE	53,935		4,502	Valero Energy Corp	138,228		6,924
Horace Mann Educators Corp	86,892		2,642	Valero Energy Partners LP ^(b)	158,463		6,766
Insurance Australia Group Ltd	2,413,864		13,958	Vermilion Energy Inc	13,996		794
Old Republic International Corp	96,652		1,428


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



COMMON STOCKS (continued)	Shares Held	Value (000's)		COMMON STOCKS (continued)	Shares Held	Value (000	's)

Oil & Gas (continued)				REITS - 3.86%
Whitecap Resources Inc	134,340	$	1,739	AEON REIT Investment Corp	815	$ 1,026
	$		155,560	Agree Realty Corp	128,140	3,922
				AIMS AMP Capital Industrial REIT	975,150	1,131
Oil & Gas Services - 0.01%				Alexandria Real Estate Equities Inc	49,620	4,118
BW Offshore Ltd	1,034,081		1,270	Altarea SCA	18,100	3,040
				American Realty Capital Properties Inc	396,216	3,514
Pharmaceuticals - 1.01%				American Tower Corp	100,000	9,750
AbbVie Inc	504,478		32,014	Apartment Investment & Management Co	134,390	4,810
Merck & Co Inc	419,233		24,291	Ascendas Real Estate Investment Trust	878,000	1,525
Novartis AG	102,731		9,534	Ashford Hospitality Trust Inc ^(d)	168,350	1,902
Pfizer Inc ^(d)	837,473		25,082	Assura Group Ltd	11,008,192	8,763
Recordati SpA	70,912		1,227	Astro Japan Property Group ^(b)	950,051	3,688
Roche Holding AG	27,770		8,195	Australian Industrial REIT	459,167	832
	$		100,343	Aviv REIT Inc	111,643	3,766
				Boston Properties Inc ^(d)	55,177	6,994
Pipelines - 5.40%				Brandywine Realty Trust	92,827	1,432
Access Midstream Partners LP ^(d)	210,462		13,110	Camden Property Trust ^(d)	46,519	3,567
Buckeye Partners LP ^(d)	356,435		26,875	Campus Crest Communities Inc ^(d)	356,981	2,263
DCP Midstream Partners LP ^(b),(d)	298,337		15,797
				Canadian Apartment Properties REIT	150,231	3,332
Enbridge Energy Partners LP	176,603		6,370	CapitaCommercial Trust	2,150,000	2,796
Enbridge Inc	126,055		5,965	CBL & Associates Properties Inc	253,770	4,855
Energy Transfer Equity LP ^(d)	672,949		39,273
				Colony Financial Inc	272,693	6,076
EnLink Midstream Partners LP	149,881		4,496	Crown Castle International Corp	150,535	11,760
Enterprise Products Partners LP ^(d)	1,533,270		56,578	CubeSmart ^(d)	178,040	3,748
Genesis Energy LP ^(d)	212,915		10,216	CYS Investments Inc ^(d)	176,793	1,579
Magellan Midstream Partners LP ^(b),(d)	561,122		45,939
				Daiwa Office Investment Corp	433	2,329
MarkWest Energy Partners LP ^(d)	290,599		20,356	DCT Industrial Trust Inc ^(d)	326,370	2,797
MPLX LP ^(b),(d)	201,496		13,436
				DDR Corp	245,530	4,454
Oiltanking Partners LP ^(b),(d)	253,496		11,554	Digital Realty Trust Inc ^(b)	99,020	6,831
ONEOK Inc	270,703		15,955	Duke Realty Corp	781,270	14,813
Pembina Pipeline Corp	281,580		11,682	Education Realty Trust Inc	384,691	4,332
Phillips 66 Partners LP	106,256		7,405	EPR Properties ^(d)	125,261	7,028
Plains All American Pipeline LP ^(b),(d)	749,784		42,250	Equity One Inc ^(d)	205,872	4,941
Plains GP Holdings LP	126,219		3,620	Equity Residential	53,046	3,690
Regency Energy Partners LP ^(d)	370,889		11,127	Essex Property Trust Inc ^(d)	23,459	4,733
Shell Midstream Partners LP ^(a)	131,319		4,424
				Eurocommercial Properties NV	44,000	2,009
Spectra Energy Corp	512,209		20,043	Federation Centres	2,246,617	5,395
Sunoco Logistics Partners LP ^(b),(d)	780,251		37,241
Targa Resources Partners LP ^(d)	146,606		8,955	Fortune Real Estate Investment Trust	1,475,000	1,346
Tesoro Logistics LP ^(b),(d)	339,960		19,140	Frasers Commercial Trust	2,517,000	2,782
				General Growth Properties Inc	106,930	2,771
TransCanada Corp	558,798		27,542	Geo Group Inc/The	206,191	8,235
TransCanada Corp ^(d)	20,000		986
Western Gas Partners LP ^(b),(d)	237,965		16,634	Granite Real Estate Investment Trust	24,900	918
				Great Portland Estates PLC	211,548	2,328
Williams Cos Inc/The ^(d)	541,418		30,054	Hospitality Properties Trust ^(d)	128,710	3,811
Williams Partners LP	200,000		10,310	Host Hotels & Resorts Inc	770,012	17,949
	$		537,333	ICADE	50,000	3,979
				Industria REIT ^(b)	1,500,374	2,635
Publicly Traded Investment Fund - 0.01%
THL Credit Inc	97,482		1,254	Japan Hotel REIT Investment Corp	6,200	3,845
				Japan Logistics Fund Inc	600	1,348
				Kenedix Office Investment Corp	824	4,406
Real Estate - 0.70%				Kenedix Residential Investment Corp	935	2,450
Agile Property Holdings Ltd	2,086,000		1,176	Keppel REIT	1,618,000	1,538
Agile Property Holdings Ltd - Rights ^(a)	260,750		17	Kite Realty Group Trust	46,730	1,210
Atrium European Real Estate Ltd ^(a),(b)	327,000		1,713	Klepierre	97,000	4,198
Citycon OYJ	885,102		2,868	Land Securities Group PLC	341,856	6,066
Croesus Retail Trust	7,066,000		5,168	Lexington Realty Trust	138,816	1,521
Deutsche Annington Immobilien SE	95,000		2,750	Liberty Property Trust ^(d)	162,245	5,641
Fabege AB	250,900		3,221	Link REIT/The	2,046,500	12,035
Hyprop Investments Ltd	216,497		1,890	Londonmetric Property PLC	200,000	472
Kerry Properties Ltd	510,000		1,749	Medical Properties Trust Inc	394,070	5,316
Mitsubishi Estate Co Ltd	441,200		11,239	Mirvac Group	1,833,543	2,909
Mitsui Fudosan Co Ltd	321,400		10,338	Nomura Real Estate Master Fund Inc	2,794	3,378
New World Development Co Ltd	2,463,000		3,096	NorthStar Realty Finance Corp	100,165	1,861
Nomura Real Estate Holdings Inc	145,800		2,577	Prologis Inc	199,250	8,299
Religare Health Trust	4,335,000		3,325	Public Storage ^(d)	16,597	3,059
Shenzhen Investment Ltd	6,196,000		1,790	Pure Industrial Real Estate Trust	350,000	1,385
Shimao Property Holdings Ltd	1,926,500		4,146	RLJ Lodging Trust	98,915	3,187
Sponda OYJ	782,145		3,581	Sabra Health Care REIT Inc	174,280	4,979
Sun Hung Kai Properties Ltd	459,400		6,855	Saul Centers Inc	36,500	2,006
Sun Hung Kai Properties Ltd - Warrants ^(a),(b)	20,533		45	Segro PLC	211,276	1,287
Wheelock & Co Ltd	250,000		1,205	Simon Property Group Inc ^(d)	118,357	21,211
WP Carey Inc	19,607		1,328	SL Green Realty Corp	17,180	1,988
	$		70,077	Spring Real Estate Investment Trust	12,748,000	5,912


COMMON STOCKS (continued)	Shares Held		Value (000's)	COMMON STOCKS (continued)	Shares Held	Value (000			's)

REITS (continued)				Telecommunications (continued)
STAG Industrial Inc	135,713	$	3,311	Vodafone Group PLC ADR	33,000		$	1,096
Stockland	1,560,000		5,833			$		172,507
Summit Hotel Properties Inc	578,340		6,732
Sun Communities Inc	146,460		8,490	Transportation - 1.05%
Vastned Retail NV	86,000		3,927	AP Moeller - Maersk A/S - B shares	1,710			3,990
Ventas Inc	150,000		10,277	Asciano Ltd	2,139,310			11,834
				CEVA Group PLC ^(a)	123			117
Vornado Realty Trust	74,390		8,144
Washington Prime Group Inc ^(d)	144,103		2,541	Deutsche Post AG	127,212			4,006
Wereldhave NV	60,000		4,919	East Japan Railway Co	80,000			6,248
Westfield Corp	930,000		6,535	Groupe Eurotunnel SA	1,227,942			15,520
Workspace Group PLC	160,000		1,684	Hutchison Port Holdings Trust	15,044,939			10,159
	$		384,195	Kamigumi Co Ltd	812,000			7,829
				Koninklijke Vopak NV	158,785			7,963
Retail - 0.42%				Norfolk Southern Corp	67,020			7,415
Abercrombie & Fitch Co	142,948		4,786	Union Pacific Corp ^(d)	248,964			28,992
ANTA Sports Products Ltd	590,000		1,158			$		104,073
Aoyama Trading Co Ltd	79,400		1,888
GameStop Corp	38,965		1,666	Water - 0.42%
Home Depot Inc/The	118,736		11,579	Aguas Andinas SA	15,488,880			9,340
				American Water Works Co Inc ^(d)	189,000			10,087
Lowe's Cos Inc	182,131		10,418
Macy's Inc	130,122		7,524	Cia de Saneamento Basico do Estado de Sao	1,273,044			9,879
Man Wah Holdings Ltd	396,400		593	Paulo ADR
Superior Plus Corp	71,700		777	Guangdong Investment Ltd	3,118,000			4,102
Wendy's Co/The	123,206		988	Suez Environnement Co	467,338			7,873
	$		41,377			$		41,281
				TOTAL COMMON STOCKS		$		3,090,939
Savings & Loans - 0.02%				INVESTMENT COMPANIES - 3.25%	Shares Held	Value (000			's)
New York Community Bancorp Inc	72,558		1,157
Provident Financial Services Inc	69,396		1,265	Publicly Traded Investment Fund - 3.25%
	$		2,422	JP Morgan Prime Money Market Fund	171,043,430			171,043
				Morgan Stanley Institutional Liquidity Funds -	151,880,771			151,881
Semiconductors - 0.28%				Government Portfolio
Holtek Semiconductor Inc	972,000		1,653			$		322,924
Intel Corp	614,168		20,888	TOTAL INVESTMENT COMPANIES		$		322,924
Intersil Corp	183,679		2,441	PREFERRED STOCKS - 2.86%	Shares Held	Value (000			's)
King Yuan Electronics Co Ltd	3,200,000		2,535
	$		27,517	Banks - 0.93%
				AgriBank FCB	33,000			3,387
Shipbuilding - 0.01%				Bank of America Corp 6.63%; Series I	18,146			468
Yangzijiang Shipbuilding Holdings Ltd	1,296,000		1,141	Bank of New York Mellon Corp/The	73,500			1,752
				Barclays Bank PLC 8.13%	169,800			4,383
Software - 0.28%				Citigroup Inc 6.88%; Series K	163,700			4,381
Microsoft Corp	594,642		27,918	Citigroup Inc 7.13%; Series J	223,000			6,034
				Deutsche Bank Contingent Capital Trust II	366,970			9,508
				Fifth Third Bancorp	209,585			5,686
Storage & Warehousing - 0.04%				GMAC Capital Trust I	207,000			5,533
Safestore Holdings PLC	1,318,258		4,391	Goldman Sachs Group Inc/The	32,200			771
				HSBC Holdings PLC 8.00%	13,300			356
Telecommunications - 1.73%				HSBC USA Inc 2.86%	214,384			10,632
AT&T Inc	60,000		2,090	HSBC USA Inc 4.50%	86,343			2,165
BCE Inc ^(d)	490,000		21,790	ING Groep NV 6.13%	146,000			3,666
Belgacom SA	139,754		5,278	JP Morgan Chase & Co	34,800			804
Bezeq The Israeli Telecommunication Corp	758,273		1,296	Lloyds Banking Group PLC	64,850			1,702
Ltd				Morgan Stanley	4,021			110
BT Group PLC	1,090,000		6,426	PNC Financial Services Group Inc/The	234,700			6,393
BT Group PLC ADR	20,000		1,180	Royal Bank of Scotland Group PLC 5.75%;	218,454			5,127
CenturyLink Inc ^(d)	280,000		11,614	Series L
Cleveland Unlimited Inc - Warrants ^(a),(b),(c)	2,756		11	State Street Corp 5.25%; Series C	273,512			6,676
Consolidated Communications Holdings Inc	47,711		1,236	State Street Corp 5.90%; Series D	65,000			1,696
Eutelsat Communications SA	373,512		12,109	TCF Financial Corp	48,227			1,291
Freenet AG	77,782		2,041	US Bancorp/MN - Series G	366,691			9,923
KDDI Corp	155,400		10,205	Wells Fargo & Co 6.63%	1,861			52
Nippon Telegraph & Telephone Corp	274,500		17,079			$		92,496
NTELOS Holdings Corp	68,054		686	Diversified Financial Services - 0.03%
NTT DOCOMO Inc	939,900		15,852	Affiliated Managers Group Inc 5.25%	45,485			1,161
Orange SA	563,125		8,965	Affiliated Managers Group Inc 6.38%	42,255			1,101
PCCW Ltd	2,285,000		1,453	General Electric Capital Corp 4.70%	1,217			29
Rogers Communications Inc	163,400		6,144	General Electric Capital Corp 4.88%	31,317			778
SK Telecom Co Ltd	31,709		7,946	Morgan Stanley Capital Trust V	2,003			51
TDC A/S	154,321		1,179			$		3,120
Telekom Malaysia Bhd	2,240,200		4,905
Telstra Corp Ltd	1,972,545		9,816	Electric - 0.31%
Verizon Communications Inc ^(d)	440,000		22,110	Duke Energy Corp	19,669			477
				Entergy Arkansas Inc 4.90%	17,312			411


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



PREFERRED STOCKS (continued)	Shares Held Value (000's)			PREFERRED STOCKS (continued)	Shares Held Value (000's)

Electric (continued)				Transportation - 0.18%
Entergy Arkansas Inc 5.75%	77,527	$	1,972	CEVA Group PLC ^(a)		267	$	254
Entergy Louisiana LLC 4.70%	203,100		4,511	Seaspan Corp		704,000		17,952
Entergy Louisiana LLC 5.88%	11,790		302			$		18,206
Entergy New Orleans Inc	56,900		1,376	TOTAL PREFERRED STOCKS		$		284,662
Integrys Energy Group Inc	81,123		2,119		Principal
Interstate Power & Light Co	102,658		2,577	BONDS- 56.77%	Amount (000's) Value (000's)
NextEra Energy Capital Holdings Inc - Series	360,617		8,175
I				Advertising - 0.44%
PPL Capital Funding Inc	50,000		1,217	Alliance Data Systems Corp
				5.38%, 08/01/2022 ^(e)	$	13,300	$	13,500
SCANA Corp	5,427		138
Southern California Edison Co	80,000		8,153	MDC Partners Inc
				6.75%, 04/01/2020 ^(e)		20,800		21,580
	$		31,428
				Sitel LLC / Sitel Finance Corp
Hand & Machine Tools - 0.01%				11.00%, 08/01/2017 ^(e)		8,000		8,240
Stanley Black & Decker Inc	36,230		915			$		43,320

				Aerospace & Defense - 0.26%
Insurance - 0.74%				Finmeccanica Finance SA
Aegon NV 6.38%	331,071		8,452	4.50%, 01/19/2021	EUR	3,600		4,780
Aflac Inc	277,742		6,888	GenCorp Inc
Allstate Corp/The 6.63%; Series E	122,903		3,237	7.13%, 03/15/2021	$	3,800		4,037
Allstate Corp/The 6.75%; Series C	43,714		1,180	LMI Aerospace Inc
American Financial Group Inc/OH 5.75%	23,178		574	7.38%, 07/15/2019 ^(e)		2,850		2,850
American Financial Group Inc/OH 6.38%	23,903		627	TransDigm Inc
American Financial Group Inc/OH 7.00%	34,705		910	5.50%, 10/15/2020		9,945		9,945
Arch Capital Group Ltd	92,770		2,481	6.00%, 07/15/2022		2,540		2,569
Aspen Insurance Holdings Ltd 5.95%	412,037		10,659	6.50%, 07/15/2024		1,900		1,957
Aspen Insurance Holdings Ltd 7.25%	132,920		3,518			$		26,138
Axis Capital Holdings Ltd 6.88%	141,123		3,761
Delphi Financial Group Inc 7.38%	291,374		7,239	Agriculture - 0.25%
Hartford Financial Services Group Inc/The	161,051		4,877	Vector Group Ltd
PartnerRe Ltd 7.25%	149,437		4,092	7.75%, 02/15/2021		22,626		24,521
Protective Life Corp 6.25%	142,753		3,705
Prudential PLC 6.75%	2,800		72	Automobile Manufacturers - 0.22%
Reinsurance Group of America Inc	40,000		1,117	CNH Industrial Finance Europe SA
RenaissanceRe Holdings Ltd - Series E	43,871		1,009	6.25%, 03/09/2018	EUR	2,200		3,087
Torchmark Corp	120,550		3,023	Fiat Chrysler Finance Europe
WR Berkley Corp	32,214		777	6.75%, 10/14/2019		2,100		3,007
XLIT Ltd	6,623		5,522	7.75%, 10/17/2016		2,550		3,515
	$		73,720	Jaguar Land Rover Automotive PLC
				4.25%, 11/15/2019 ^(e)	$	2,800		2,814
Media - 0.03%
Comcast Corp	103,036		2,620	8.25%, 03/15/2020	GBP	500		878
				Peugeot SA
				6.50%, 01/18/2019	EUR	3,300		4,727
REITS - 0.28%				Renault SA
Digital Realty Trust Inc - Series E	40,632		1,052	3.13%, 03/05/2021		2,750		3,663
Digital Realty Trust Inc - Series F	10,506		265			$		21,691
Digital Realty Trust Inc - Series H	4,675		125
Equity Residential	20,702		1,289	Automobile Parts & Equipment - 0.16%
Kimco Realty Corp 5.50%	112,037		2,650	Gestamp Funding Luxembourg SA
Kimco Realty Corp 6.00%	3,000		76	5.88%, 05/31/2020		3,300		4,351
National Retail Properties Inc	80,925		2,102	GKN Holdings PLC
Prologis Inc - Series Q	92,034		5,830	5.38%, 09/19/2022	GBP	400		719
PS Business Parks Inc - Series R	111,763		2,884	Metalsa SA de CV
Public Storage Inc 5.20%; Series W	61,717		1,418	4.90%, 04/24/2023 ^(e)	$	2,083		2,000
Public Storage Inc 6.00%; Series Z	31,149		785	Samvardhana Motherson Automotive Systems
Public Storage Inc 6.38%; Series Y	22,057		570	Group BV
Realty Income Corp - Series F	99,799		2,692	4.13%, 07/15/2021	EUR	2,600		3,161
Ventas Realty LP / Ventas Capital Corp	53,425		1,316	Schaeffler Holding Finance BV
Vornado Realty Trust - Series J	165,424		4,466	5.75%, PIK 5.75%, 11/15/2021 ^(e),(f)		2,550		3,299
	$		27,520	6.88%, PIK 7.63%, 08/15/2018 ^(f)		2,052		2,700
						$		16,230
Savings & Loans - 0.02%
First Niagara Financial Group Inc	71,800		2,003	Banks- 1.71%
				Abbey National Capital Trust I
				8.96%, 12/31/2049	$	2,300		2,947
Telecommunications - 0.33%				ABN AMRO Bank NV
Centaur Funding Corp 9.08% ^(e)	11,900		14,934	6.25%, 09/13/2022 ^(g)		2,000		2,188
Qwest Corp 7.00%	60,104		1,542	Alfa Bank OJSC Via Alfa Bond Issuance
Qwest Corp 7.38%	165,676		4,370	PLC
Qwest Corp 7.50%	168,725		4,505	7.50%, 09/26/2019 ^(e)		4,265		4,217
Telephone & Data Systems Inc 6.88%	25,608		645	Banco do Brasil SA/Cayman
Telephone & Data Systems Inc 7.00%	151,457		3,862	6.25%, 12/29/2049 ^(e),(g)		3,000		2,355
Verizon Communications Inc	107,169		2,776	Bancolombia SA
	$		32,634	5.13%, 09/11/2022		3,696		3,770


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



		Principal					Principal
BONDS (continued)		Amount (000's) Value (000's)			BONDS (continued)		Amount (000's) Value (000's)

Banks (continued)					Building Materials (continued)
Bank of America Corp					Cemex Finance LLC
6.25%, 09/29/2049 ^(g)	$	4,600	$	4,594	9.38%, 10/12/2022 ^(e)		$	2,347	$	2,705
8.13%, 12/29/2049 ^(g)		2,117		2,297	Cemex SAB de CV
Barclays PLC					7.25%, 01/15/2021 ^(e)			861		929
6.63%, 06/29/2049 ^(g)		1,961		1,877	Grupo Isolux Corsan Finance BV
8.25%, 12/29/2049 ^(g)		4,000		4,130	6.63%, 04/15/2021		EUR	1,300		1,564
BBVA Bancomer SA/Texas					HeidelbergCement Finance Luxembourg SA
6.75%, 09/30/2022 ^(e)		1,615		1,829	7.50%, 04/03/2020			3,850		6,047
BNP Paribas SA					9.50%, 12/15/2018			1,150		1,860
7.20%, 06/29/2049 ^(e)		1,300		1,499	Kerneos Corporate SAS
BPCE SA					5.75%, 03/01/2021			2,200		2,743
13.00%, 08/29/2049		1,581		1,726	Lafarge SA
Cadence Financial Corp					4.75%, 09/30/2020			3,800		5,548
4.88%, 06/28/2019 ^(b),(e)		3,500		3,517	Norbord Inc
Citigroup Inc					5.38%, 12/01/2020 ^(e)		$	2,500		2,456
6.30%, 12/29/2049 ^(g)		6,500		6,459				$		29,696
Cooperatieve Centrale Raiffeisen-
Boerenleenbank BA/Netherlands					Chemicals - 0.63%
11.00%, 12/29/2049 ^(e),(g)		11,115		14,505	Axalta Coating Systems US Holdings Inc /
Corestates Capital III					Axalta Coating Systems Dutch Holding B
0.80%, 02/15/2027 ^(e),(g)		500		435	5.75%, 02/01/2021		EUR	3,980		5,207
Credit Agricole SA					Braskem America Finance Co
					7.13%, 07/22/2041 ^(e)		$	600		612
8.38%, 12/31/2049 ^(e),(g)		1,900		2,202
Credit Suisse Group AG					Braskem Finance Ltd
6.25%, 12/29/2049 ^(e),(g)		7,200		7,002	5.75%, 04/15/2021			1,988		2,077
					7.38%, 10/29/2049 ^(e)			1,533		1,586
7.50%, 12/29/2049 ^(e),(g)		1,000		1,063
Development Bank of Kazakhstan JSC					Celanese US Holdings LLC
5.50%, 12/20/2015		200		207	3.25%, 10/15/2019		EUR	1,400		1,789
First Hawaiian Capital I					EuroChem Mineral & Chemical Co OJSC via
8.34%, 07/01/2027		2,000		2,028	EuroChem GI Ltd
					5.13%, 12/12/2017 ^(e)		$	1,550		1,519
Goldman Sachs Group Inc/The
5.70%, 12/29/2049 ^(g)		2,000		2,045	Huntsman International LLC
HSBC Capital Funding LP/Jersey					5.13%, 04/15/2021		EUR	2,700		3,524
10.18%, 12/29/2049 ^(e),(g)		4,000		5,970	INEOS Group Holdings SA
HSBC USA Capital Trust I					5.75%, 02/15/2019			3,900		4,865
7.81%, 12/15/2026 ^(e)		300		304	Mexichem SAB de CV
					5.88%, 09/17/2044 ^(e)		$	4,227		4,227
HSBC USA Capital Trust II
8.38%, 05/15/2027 ^(e)		1,980		2,006	Nexeo Solutions LLC / Nexeo Solutions
Itau Unibanco Holding SA/Cayman Island					Finance Corp
5.65%, 03/19/2022 ^(e)		1,100		1,129	8.38%, 03/01/2018			2,290		2,244
JP Morgan Chase & Co					OCP SA
					5.63%, 04/25/2024 ^(e)			1,958		2,054
6.13%, 12/29/2049 ^(g)		5,500		5,486
6.75%, 01/29/2049 ^(g)		13,700		14,434	Sinochem Offshore Capital Co Ltd
					3.25%, 04/29/2019 ^(e)			10,603		10,762
KeyCorp Capital III
7.75%, 07/15/2029		795		971	SPCM SA
					6.00%, 01/15/2022 ^(e)			4,100		4,305
M&T Bank Corp
6.45%, 12/29/2049 ^(g)		535		570	TPC Group Inc
					8.75%, 12/15/2020 ^(e)			16,665		17,436
Morgan Stanley
5.45%, 07/29/2049 ^(g)		1,250		1,256				$		62,207
Nordea Bank AB					Coal- 0.73	%
5.50%, 09/29/2049 ^(e),(g)		4,100		4,141	CONSOL Energy Inc
5.50%, 09/29/2049 ^(g)		2,700		2,727	5.88%, 04/15/2022 ^(e)			10,551		10,709
6.13%, 12/29/2049 ^(e),(g)		2,000		2,004	Foresight Energy LLC / Foresight Energy
PNC Financial Services Group Inc/The					Corp
6.75%, 07/29/2049 ^(g)		8,500		9,278	7.88%, 08/15/2021 ^(e)			38,815		40,368
Provident Funding Associates LP / PFG					Natural Resource Partners LP / NRP Finance
Finance Corp					Corp
6.75%, 06/15/2021 ^(e)		13,020		12,987	9.13%, 10/01/2018 ^(e)			4,000		4,000
Societe Generale SA					Peabody Energy Corp
0.98%, 12/29/2049 ^(e),(g)		3,000		2,700	6.00%, 11/15/2018			2,830		2,738
7.88%, 12/29/2049 ^(e),(g)		2,000		2,000	6.25%, 11/15/2021			15,805		14,965
8.25%, 09/29/2049 ^(g)		5,500		5,811				$		72,780
Standard Chartered PLC
7.01%, 07/29/2049 ^(e)		4,100		4,582	Commercial Services - 0.78%
UBS Preferred Funding Trust V					AA Bond Co Ltd
6.24%, 05/29/2049		5,000		5,197	9.50%, 07/31/2043		GBP	3,150		5,548
Wells Fargo & Co					ADT Corp/The
7.98%, 12/31/2049 ^(g)		12,000		13,226	6.25%, 10/15/2021		$	6,000		6,300
		$		169,671	Anna Merger Sub Inc
					7.75%, 10/01/2022 ^(e)			2,650		2,700
Building Materials - 0.30%					Avis Budget Finance PLC
Ainsworth Lumber Co Ltd					6.00%, 03/01/2021		EUR	2,700		3,553
7.50%, 12/15/2017 ^(e)		5,646		5,844


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



	Principal					Principal
BONDS (continued)	Amount (000's) Value (000's)				BONDS (continued)	Amount (000's) Value (000's)

Commercial Services (continued)					Diversified Financial Services (continued)
Brand Energy & Infrastructure Services Inc					National Financial Partners Corp
8.50%, 12/01/2021 ^(e)	$	7,778	$	7,749	9.00%, 07/15/2021 ^(e)	$	6,475	$	6,880
Ceridian LLC / Comdata Inc					Nationstar Mortgage LLC / Nationstar Capital
8.13%, 11/15/2017 ^(e)		2,050		2,050	Corp
FTI Consulting Inc					6.50%, 07/01/2021		3,565		3,315
6.75%, 10/01/2020		6,319		6,666	6.50%, 06/01/2022		3,500		3,255
Iron Mountain Europe PLC					7.88%, 10/01/2020		3,800		3,743
6.13%, 09/15/2022 ^(e)	GBP	2,000		3,239	Oxford Finance LLC / Oxford Finance Co-
Jaguar Holding Co I					Issuer Inc
9.38%, 10/15/2017 ^(e)	$	20,282		20,764	7.25%, 01/15/2018 ^(e)		1,085		1,123
Jaguar Holding Co II / Jaguar Merger Sub Inc					Schahin II Finance Co SPV Ltd
9.50%, 12/01/2019 ^(e)		6,345		6,805	5.88%, 09/25/2023 ^(e)		1,331		1,258
Live Nation Entertainment Inc					SUAM Finance BV
7.00%, 09/01/2020 ^(e)		2,000		2,125	4.88%, 04/17/2024 ^(e)		2,921		2,994
Midas Intermediate Holdco II LLC / Midas							$		105,813
Intermediate Holdco II Finance Inc
7.88%, 10/01/2022 ^(e)		3,238		3,238	Electric - 0.46%
Prospect Medical Holdings Inc					AES Corp/VA
8.38%, 05/01/2019 ^(e)		1,550		1,658	7.38%, 07/01/2021		6,764		7,717
Truven Health Analytics Inc					Centrais Eletricas Brasileiras SA
10.63%, 06/01/2020		5,010		5,361	5.75%, 10/27/2021		2,812		2,858
		$		77,756	Comision Federal de Electricidad
					4.88%, 01/15/2024 ^(e)		891		940
Computers - 0.08%					Dominion Resources Inc/VA
NCR Corp					7.50%, 06/30/2066		700		742
6.38%, 12/15/2023 ^(e)		6,900		7,280	EDP Finance BV
6.38%, 12/15/2023		600		633	4.13%, 01/20/2021	EUR	3,850		5,259
		$		7,913	Electricite de France SA
					5.25%, 01/29/2049 ^(e),(g)	$	4,390		4,555
Consumer Products - 0.34%					Enel SpA
Central Garden and Pet Co					5.00%, 01/15/2075 ^(g)	EUR	1,800		2,377
8.25%, 03/01/2018		22,050		21,967	Inkia Energy Ltd
Spectrum Brands Inc					8.38%, 04/04/2021 ^(e)	$	525		568
6.38%, 11/15/2020		3,945		4,182	Listrindo Capital BV
6.63%, 11/15/2022		6,945		7,449	6.95%, 02/21/2019 ^(e)		5,450		5,804
		$		33,598	Majapahit Holding BV
Distribution & Wholesale - 0.20%					7.75%, 01/20/2020 ^(e)		1,730		2,013
Global Partners LP / GLP Finance Corp					7.88%, 06/29/2037		1,375		1,657
6.25%, 07/15/2022 ^(e)		770		763	NextEra Energy Capital Holdings Inc
Li & Fung Ltd					7.30%, 09/01/2067 ^(g)		5,000		5,409
6.00%, 11/25/2049		4,500		4,753	Perusahaan Listrik Negara PT
VWR Funding Inc					5.50%, 11/22/2021 ^(e)		1,400		1,487
7.25%, 09/15/2017		13,705		14,390	RWE AG
					7.00%, 10/12/2072 ^(g)		4,300		4,665
		$		19,906
							$		46,051
Diversified Financial Services - 1.06%
Charles Schwab Corp/The					Electrical Components & Equipment - 0.05%
7.00%, 02/28/2049 ^(g)		4,198		4,893	WESCO Distribution Inc
CIMPOR Financial Operations BV					5.38%, 12/15/2021		4,830		4,854
5.75%, 07/17/2024 ^(e)		2,700		2,596
Citigroup Capital III					Electronics - 0.13%
7.63%, 12/01/2036		8,600		10,714	Techem Energy Metering Service GmbH &
Credit Acceptance Corp					Co KG
6.13%, 02/15/2021 ^(e)		17,100		17,698
					7.88%, 10/01/2020	EUR	4,735		6,544
General Electric Capital Corp					Trionista TopCo GmbH
6.25%, 12/31/2049 ^(g)		2,600		2,844
7.13%, 12/29/2049 ^(g)		3,300		3,845	6.88%, 04/30/2021		4,600		6,039
							$		12,583
Icahn Enterprises LP / Icahn Enterprises
Finance Corp					Energy - Alternate Sources - 0.11%
4.88%, 03/15/2019		5,500		5,596	ContourGlobal Power Holdings SA
5.88%, 02/01/2022		3,900		4,007	7.13%, 06/01/2019 ^(e)	$	11,150		11,178
6.00%, 08/01/2020		2,400		2,520
Infinity Acquisition LLC / Infinity Acquisition					Engineering & Construction - 0.29%
Finance Corp					AECOM Technology Corp
7.25%, 08/01/2022 ^(e)		5,200		4,862
					5.75%, 10/15/2022 ^(e)		1,200		1,263
Jefferies Finance LLC / JFIN Co-Issuer Corp					5.88%, 10/15/2024 ^(e)		4,000		4,230
7.38%, 04/01/2020 ^(e)		3,300		3,284
7.50%, 04/15/2021 ^(e)		10,100		10,050	Deutsche Raststaetten Gruppe IV GmbH
					6.75%, 12/30/2020	EUR	3,250		4,307
Jefferies LoanCore LLC / JLC Finance Corp					Heathrow Finance PLC
6.88%, 06/01/2020 ^(e)		6,450		6,272
					7.13%, 03/01/2017	GBP	3,075		5,262
MAF Global Securities Ltd
7.13%, 10/29/2049 ^(g)		3,700		4,064


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



		Principal					Principal
	BONDS (continued)	Amount (000's)		Value (000's)		BONDS (continued)	Amount (000's)		Value (000's)

	Engineering & Construction (continued)					Forest Products & Paper - 0.10%
	Michael Baker Holdings LLC / Micahel Baker					Cascades Inc
	Finance Corp					5.50%, 07/15/2022 ^(e)	$	6,400	$	6,320
	8.88%, PIK 9.63%, 04/15/2019 ^(e),(f)	$	6,100	$	6,039	Smurfit Kappa Acquisitions
	Michael Baker International LLC / CDL					3.25%, 06/01/2021	EUR	2,800		3,509
	Acquisition Co Inc							$		9,829
	8.25%, 10/15/2018 ^(e)		6,050		6,141
	Novafives SAS					Gas- 0.25%
	4.50%, 06/30/2021	EUR	1,300		1,614	LBC Tank Terminals Holding Netherlands
			$		28,856	BV
						6.88%, 05/15/2023 ^(e)	$	11,050		11,768
	Entertainment - 0.47%					NGL Energy Partners LP / NGL Energy
	Choctaw Resort Development Enterprise					Finance Corp
	7.25%, 11/15/2019 ^(e)	$	6,527		6,478	6.88%, 10/15/2021 ^(e)		8,555		9,090
	DreamWorks Animation SKG Inc					Perusahaan Gas Negara Persero Tbk PT
	6.88%, 08/15/2020 ^(e)		8,956		9,359	5.13%, 05/16/2024 ^(e)		3,825		3,925
	GLP Capital LP / GLP Financing II Inc							$		24,783
	5.38%, 11/01/2023		1,625		1,710
	Great Canadian Gaming Corp					Hand & Machine Tools - 0.01%
	6.63%, 07/25/2022 ^(e)	CAD	845		787	Stanley Black & Decker Inc
	Regal Entertainment Group					5.75%, 12/15/2053		450		485
	5.75%, 03/15/2022	$	2,000		1,955
	5.75%, 06/15/2023		2,500		2,400	Healthcare - Products - 0.21%
	Vougeot Bidco PLC					ConvaTec Finance International SA
	7.88%, 07/15/2020	GBP	1,800		2,880	8.25%, PIK 9.00%, 01/15/2019 ^(e),(f)		2,000		2,043
	WMG Acquisition Corp					Fresenius Finance BV
	5.63%, 04/15/2022 ^(e)	$	1,800		1,809	3.00%, 02/01/2021	EUR	1,900		2,510
	6.00%, 01/15/2021 ^(e)		2,286		2,343	Halyard Health Inc
	6.75%, 04/15/2022 ^(e)		17,085		16,829	6.25%, 10/15/2022 ^(e)	$	4,225		4,320
			$		46,550	Mallinckrodt International Finance SA
						4.75%, 04/15/2023		2,800		2,688
	Food- 1.14%					Physio-Control International Inc
	Bakkavor Finance 2 PLC					9.88%, 01/15/2019 ^(e)		8,212		8,849
	8.25%, 02/15/2018	GBP	2,550		4,140
	Boparan Finance PLC							$		20,410
	5.50%, 07/15/2021		3,500		5,067	Healthcare - Services - 1.15%
	Bumble Bee Holdco SCA					Acadia Healthcare Co Inc
	9.63%, PIK 10.38%, 03/15/2018 ^(e),(f)	$	6,950		7,245	5.13%, 07/01/2022 ^(e)		11,650		11,577
	Cencosud SA					6.13%, 03/15/2021		2,750		2,849
	4.88%, 01/20/2023 ^(e)		1,849		1,847	Amsurg Corp
	5.50%, 01/20/2021 ^(e)		352		376	5.63%, 07/15/2022 ^(e)		12,490		12,941
	Cosan Luxembourg SA					Care UK Health & Social Care PLC
	5.00%, 03/14/2023 ^(e)		3,671		3,533	5.56%, 07/15/2019 ^(e),(g)	GBP	3,000		4,463
	ESAL GmbH					CHS/Community Health Systems Inc
	6.25%, 02/05/2023 ^(e)		4,221		4,306	5.13%, 08/01/2021	$	2,000		2,090
	Findus Bondco SA					6.88%, 02/01/2022 ^(e)		3,000		3,233
	9.13%, 07/01/2018	EUR	2,505		3,312	DaVita HealthCare Partners Inc
	FPC Finance Ltd					5.75%, 08/15/2022		9,190		9,741
	6.00%, 06/28/2019	$	1,850		1,982	FMC Finance VII SA
	FPT Finance Ltd					5.25%, 02/15/2021	EUR	1,000		1,457
	6.38%, 09/28/2020		1,000		1,096	Fresenius Medical Care US Finance II Inc
	JBS USA LLC / JBS USA Finance Inc					4.75%, 10/15/2024 ^(e)	$	5,000		5,016
	5.88%, 07/15/2024 ^(e)		3,250		3,266	HCA Inc
	KeHE Distributors LLC / KeHE Finance					5.25%, 04/15/2025		6,000		6,218
	Corp					Holding Medi-Partenaires SAS
	7.63%, 08/15/2021 ^(e)		7,625		8,102	7.00%, 05/15/2020	EUR	1,260		1,650
	Minerva Luxembourg SA					MedImpact Holdings Inc
	7.75%, 01/31/2023 ^(e)		3,872		4,046	10.50%, 02/01/2018 ^(e)	$	8,050		8,592
	Olam International Ltd					MPH Acquisition Holdings LLC
	5.75%, 09/20/2017		3,341		3,475	6.63%, 04/01/2022 ^(e)		2,380		2,490
	Premier Foods Finance PLC					Priory Group No 3 PLC
	6.50%, 03/15/2021	GBP	2,900		4,171	7.00%, 02/15/2018	GBP	2,800		4,675
	R&R PIK PLC					ResCare Inc
	9.25%, PIK 10.00%, 05/15/2018 ^(f)	EUR	5,150		6,509	10.75%, 01/15/2019	$	3,030		3,235
	TreeHouse Foods Inc					Select Medical Corp
	4.88%, 03/15/2022	$	7,000		7,105	6.38%, 06/01/2021		8,100		8,282
	US Foods Inc					Symbion Inc/DE
	8.50%, 06/30/2019		39,155		41,260	8.00%, 06/15/2016		5,455		5,646
	WhiteWave Foods Co/The					Tenet Healthcare Corp
	5.38%, 10/01/2022		2,700		2,842	6.00%, 10/01/2020		13,080		14,061
			$		113,680	United Surgical Partners International Inc
						9.00%, 04/01/2020		5,440		5,875
								$		114,091


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



	Principal					Principal
BONDS (continued)	Amount (000's) Value (000's)				BONDS (continued)	Amount (000's) Value (000's)

Holding Companies - Diversified - 1.62%					Insurance (continued)
Alfa SAB de CV					Provident Financing Trust I
5.25%, 03/25/2024 ^(e)	$	1,600	$	1,742	7.41%, 03/15/2038	$	3,500	$	4,089
6.88%, 03/25/2044		2,761		3,106	Prudential PLC
Alphabet Holding Co Inc					7.75%, 01/29/2049		2,215		2,361
7.75%, 11/01/2017		7,350		7,130	Sirius International Group Ltd
CeramTec Group GmbH					7.51%, 05/29/2049 ^(e),(g)		800		840
8.25%, 08/15/2021	EUR	4,385		5,896	USI Inc/NY
Dubai Holding Commercial Operations MTN					7.75%, 01/15/2021 ^(e)		7,100		7,189
Ltd					Wilton Re Finance LLC
6.00%, 02/01/2017	GBP	4,800		7,846	5.88%, 03/30/2033 ^(e),(g)		8,450		8,788
GCS Holdco Finance I SA					York Risk Services Holding Corp
6.50%, 11/15/2018	EUR	3,150		4,081	8.50%, 10/01/2022 ^(e)		5,100		5,177
Harbinger Group Inc							$		132,421
7.75%, 01/15/2022	$	53,206		54,004
7.75%, 01/15/2022 ^(e)		4,340		4,394	Internet - 0.27%
7.88%, 07/15/2019		9,125		9,878	Ancestry.com Inc
					9.63%, PIK 10.38%, 10/15/2018 ^(e),(f)		7,730		7,710
KraussMaffei Group GmbH
8.75%, 12/15/2020	EUR	2,000		2,718	11.00%, 12/15/2020		13,810		15,640
Opal Acquisition Inc					IAC/InterActiveCorp
8.88%, 12/15/2021 ^(e)	$	37,620		39,266	4.75%, 12/15/2022		3,745		3,661
Sinochem Overseas Capital Co Ltd							$		27,011
4.50%, 11/12/2020		2,116		2,256	Investment Companies - 0.16%
4.50%, 11/12/2020 ^(e)		14,127		15,061	American Capital Ltd
6.30%, 11/12/2040		950		1,159	6.50%, 09/15/2018 ^(e)		6,475		6,701
Tenedora Nemak SA de CV					Artsonig Pty Ltd
5.50%, 02/28/2023 ^(e)		1,516		1,576	11.50%, PIK 12.00%, 04/01/2019^(e),(f)		6,766		6,411
Votorantim Cimentos SA					Grupo Aval Ltd
7.25%, 04/05/2041 ^(e)		1,350		1,403	4.75%, 09/26/2022 ^(e)		2,881		2,879
		$		161,516			$		15,991

Insurance - 1.33%					Iron & Steel - 0.39%
ACE Capital Trust II					ABJA Investment Co Pte Ltd
9.70%, 04/01/2030		2,500		3,675	4.85%, 01/31/2020		3,000		3,086
AG Insurance SA/NV					APERAM
6.75%, 03/29/2049 ^(g)		3,000		3,212	7.75%, 04/01/2018 ^(e)		4,200		4,347
AIG Life Holdings Inc					ArcelorMittal
7.57%, 12/01/2045 ^(e)		2,900		3,821	6.75%, 02/25/2022		3,800		4,218
8.50%, 07/01/2030		5,400		7,115	CITIC Ltd
Allstate Corp/The					6.38%, 04/10/2020		889		1,001
5.75%, 08/15/2053 ^(g)		100		106	6.63%, 04/15/2021		683		776
American Equity Investment Life Holding					7.88%, 04/15/2049 ^(g)		3,350		3,501
Co					8.62%, 05/29/2049 ^(g)		1,000		1,140
6.63%, 07/15/2021		15,775		16,642	Metalloinvest Finance Ltd
American International Group Inc					5.63%, 04/17/2020 ^(e)		2,200		1,994
8.18%, 05/15/2068		1,500		2,036	6.50%, 07/21/2016 ^(e)		550		554
AXA SA					Optima Specialty Steel
8.60%, 12/15/2030		4,600		6,193	16.00%, 12/30/2016 ^(b),(c)		5,200		5,616
Catlin Insurance Co Ltd					Ryerson Inc / Joseph T Ryerson & Son Inc
7.25%, 07/29/2049 ^(e)		1,050		1,076	9.00%, 10/15/2017		5,820		6,126
Dai-ichi Life Insurance Co Ltd/The					Samarco Mineracao SA
5.10%, 12/28/2049 ^(e),(g)		3,000		3,078	4.13%, 11/01/2022 ^(e)		2,233		2,124
Fidelity & Guaranty Life Holdings Inc					ThyssenKrupp AG
6.38%, 04/01/2021 ^(e)		4,775		5,061	4.00%, 08/27/2018	EUR	3,400		4,561
Great-West Life & Annuity Insurance Capital							$		39,044
LP
6.63%, 11/15/2034 ^(e)		2,400		2,666	Leisure Products & Services - 0.12%
Hockey Merger Sub 2 Inc					24 Hour Holdings III LLC
7.88%, 10/01/2021 ^(e)		8,175		8,522	8.00%, 06/01/2022 ^(e)	$	9,480		8,958
Ironshore Holdings US Inc					Jarden Corp
8.50%, 05/15/2020 ^(e)		7,170		8,634	3.75%, 10/01/2021	EUR	2,000		2,538
Lancashire Holdings Ltd							$		11,496
5.70%, 10/01/2022 ^(e)		3,900		4,292
					Lodging - 0.26%

Liberty Mutual Group Inc					Caesars Entertainment Operating Co Inc
7.80%, 03/07/2087 (e)		7,561		8,846	11.25%, 06/01/2017	$	24,740		18,555

Lincoln National Corp					MCE Finance Ltd
6.05%, 04/20/2067 (g)		684		696	5.00%, 02/15/2021 ^(e)		4,597		4,528
MetLife Capital Trust X					Seminole Hard Rock Entertainment Inc /
9.25%, 04/08/2068 ^(e)		9,800		14,014
					Seminole Hard Rock International LLC
MetLife Inc					5.88%, 05/15/2021 ^(e)		1,000		985
6.40%, 12/15/2066 ^(g)		1,500		1,686
					Wynn Macau Ltd
Nippon Life Insurance Co					5.25%, 10/15/2021 ^(e)		1,650		1,650
5.10%, 10/16/2044 ^(e),(g)		2,500		2,606
							$		25,718


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



			Principal					Principal
	BONDS (continued)		Amount (000's) Value (000's)				BONDS (continued)	Amount (000's) Value (000's)

	Machinery - Diversified - 0.41%						Mining - 1.31%
	Cleaver-Brooks Inc						Aleris International Inc
	8.75%, 12/15/2019 ^(e)		$	2,780	$	3,023	7.88%, 11/01/2020	$	3,525	$	3,666
	9.75%, 12/31/2019 ^(b),(c),(e)			12,500		12,500	Barminco Finance Pty Ltd
	Galapagos SA/Luxembourg						9.00%, 06/01/2018 ^(e)		8,275		7,116
	5.38%, 06/15/2021		EUR	2,500		3,052	Century Aluminum Co
	SPL Logistics Escrow LLC / SPL Logistics						7.50%, 06/01/2021 ^(e)		18,180		19,362
	Finance Corp						Cia Brasileira de Aluminio
	8.88%, 08/01/2020 ^(e)		$	5,044		5,460	4.75%, 06/17/2024 ^(e)		2,093		2,025
	Tempel Steel Co						Cia Minera Ares SAC
	12.00%, 08/15/2016 ^(e)			4,075		4,116	7.75%, 01/23/2021 ^(e)		2,834		3,011
	Zebra Technologies Corp						Cia Minera Milpo SAA
	7.25%, 10/15/2022 ^(e)			12,420		13,072	4.63%, 03/28/2023 ^(e)		3,375		3,383
				$		41,223	Constellium NV
							4.63%, 05/15/2021	EUR	3,350		4,156
	Media- 1.52	%					Corp Nacional del Cobre de Chile
	CCO Holdings LLC / CCO Holdings Capital						3.00%, 07/17/2022 ^(e)	$	13,534		13,067
	Corp						3.88%, 11/03/2021		3,232		3,338
	5.75%, 09/01/2023			2,850		2,918	4.25%, 07/17/2042 ^(e)		3,805		3,475
	CCOH Safari LLC						4.50%, 08/13/2023 ^(e)		12,104		12,803
	5.75%, 12/01/2024 ^(h)			13,525		13,601
							5.63%, 09/21/2035 ^(e)		2,185		2,437
	Clear Channel Worldwide Holdings Inc						6.15%, 10/24/2036		9,862		11,568
	6.50%, 11/15/2022			6,150		6,335	7.50%, 01/15/2019		1,400		1,688
	6.50%, 11/15/2022			5,950		6,158	Eldorado Gold Corp
	7.63%, 03/15/2020			5,330		5,623	6.13%, 12/15/2020 ^(e)		6,250		6,187
	Columbus International Inc						FMG Resources August 2006 Pty Ltd
	7.38%, 03/30/2021 ^(e)			4,950		5,247
							6.00%, 04/01/2017 ^(e)		1,400		1,428
	CSC Holdings LLC						Gold Fields Orogen Holdings BVI Ltd
	5.25%, 06/01/2024 ^(e)			7,000		7,017
							4.88%, 10/07/2020 ^(e)		1,640		1,460
	6.75%, 11/15/2021			2,450		2,726	4.88%, 10/07/2020		968		861
	DCP LLC/DCP Corp						Kazatomprom Natsionalnaya Atomnaya
	10.75%, 08/15/2015 ^(e)			3,960		3,970
							Kompaniya AO
	DISH DBS Corp						6.25%, 05/20/2015		550		559
	5.88%, 07/15/2022			2,150		2,279	KGHM International Ltd
	Expo Event Transco Inc						7.75%, 06/15/2019 ^(e)		8,850		9,381
	9.00%, 06/15/2021 ^(e)			1,475		1,523
							Mirabela Nickel Ltd
	Gannett Co Inc						0.00%, 08/07/2044 ^(a),(b),(c)		138		—
	4.88%, 09/15/2021 ^(e)			1,000		1,007
							Southern Copper Corp
	Nielsen Finance LLC / Nielsen Finance Co						5.25%, 11/08/2042		1,194		1,120
	5.00%, 04/15/2022 ^(e)			4,200		4,263
							Thompson Creek Metals Co Inc
	Numericable Group SA						12.50%, 05/01/2019		3,475		3,666
	4.88%, 05/15/2019 ^(e)			7,275		7,257
							Vedanta Resources PLC
	5.38%, 05/15/2022		EUR	3,850		5,010	6.00%, 01/31/2019 ^(e)		3,294		3,360
	Quebecor Media Inc						6.75%, 06/07/2016		1,930		2,020
	5.75%, 01/15/2023		$	3,200		3,296	7.13%, 05/31/2023 ^(e)		236		240
	RCN Telecom Services LLC / RCN Capital						8.25%, 06/07/2021 ^(e)		1,200		1,308
	Corp						Yamana Gold Inc
	8.50%, 08/15/2020 ^(e)			1,110		1,163
							4.95%, 07/15/2024 ^(e)		7,500		7,336
	Sinclair Television Group Inc								$		130,021
	5.63%, 08/01/2024 ^(e)			2,075		2,049
	Sirius XM Radio Inc						Miscellaneous Manufacturing - 0.28%
	5.88%, 10/01/2020 ^(e)			5,860		6,182	Amsted Industries Inc
	6.00%, 07/15/2024 ^(e)			20,300		21,163	5.38%, 09/15/2024 ^(e)		13,000		13,000
	Unitymedia Hessen GmbH & Co KG /						Bombardier Inc
	Unitymedia NRW GmbH						6.13%, 05/15/2021	EUR	2,000		2,788
	5.50%, 01/15/2023 ^(e)			6,342		6,611	CBC Ammo LLC / CBC FinCo Inc
	5.75%, 01/15/2023		EUR	2,450		3,339	7.25%, 11/15/2021 ^(e)	$	7,350		7,277
	Unitymedia KabelBW GmbH						Gates Global LLC / Gates Global Co
	6.13%, 01/15/2025 ^(e)		$	12,050		12,577	5.75%, 07/15/2022	EUR	3,950		4,603
	9.50%, 03/15/2021		EUR	1,700		2,391			$		27,668
	9.63%, 12/01/2019			700		923
	VTR Finance BV						Mortgage Backed Securities - 15.84%
	6.88%, 01/15/2024 ^(e)		$	14,350		15,068	Banc of America Commercial Mortgage Trust
	Ziggo Bond Co BV						2006-6
	8.00%, 05/15/2018		EUR	1,400		1,899	5.48%, 10/10/2045	$	5,000		5,013
				$		151,595	Banc of America Commercial Mortgage Trust
							2007-3
	Metal Fabrication & Hardware - 0.11%						5.56%, 06/10/2049 ^(g)		10,000		10,372
	Shale-Inland Holdings LLC / Shale-Inland						Banc of America Merrill Lynch Commercial
	Finance Corp						Mortgage Inc
	8.75%, 11/15/2019 ^(e)		$	10,920		11,302	4.77%, 07/10/2043		14,250		14,034
							4.85%, 07/10/2043		9,500		8,301
							5.28%, 11/10/2042 ^(g)		3,044		3,066


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



		Principal					Principal
BONDS (continued)		Amount (000's)	Value(000	's)	BONDS (continued)		Amount (000's)	Value (000's)

Mortgage Backed Securities (continued)					Mortgage Backed Securities (continued)
BCAP LLC 2013-RR4 Trust					Credit Suisse Commercial Mortgage Trust
4.07%, 02/13/2051 ^(c),(e),(g)	$	40,801	$ 2,774		Series 2007-C5
6.07%, 02/13/2051 ^(c),(e),(g)		11,334	11,470		0.12%, 09/15/2040 ^(e),(g)	$	320,563	$	2,220
CD 2006-CD2 Mortgage Trust					Credit Suisse First Boston Mortgage Securities
5.38%, 01/15/2046 ^(g)		8,435	7,922		Corp
CD 2006-CD3 Mortgage Trust					5.10%, 08/15/2038		1,500		1,540
5.69%, 10/15/2048 ^(g)		15,650	15,218		5.23%, 12/15/2040		6,250		6,203
CD 2007-CD4 Commercial Mortgage Trust					5.23%, 12/15/2040 ^(e),(g)		6,700		6,241
5.40%, 12/11/2049		43,000	35,682		DBUBS 2011-LC1 Mortgage Trust
CD 2007-CD5 Mortgage Trust					0.25%, 11/10/2046 ^(e),(g)		142,384		2,394
0.16%, 11/15/2044 ^(e),(g)		46,825	1		DBUBS 2011-LC2 Mortgage Trust
CFCRE Commercial Mortgage Trust 2011-					1.42%, 07/10/2044 ^(e),(g)		18,233		869
C1					DBUBS 2011-LC3 Mortgage Trust
5.22%, 04/15/2044 ^(e),(g)		5,550	6,289		3.75%, 08/10/2044 ^(e)		12,029		10,619
Citigroup Commercial Mortgage Trust 2007-					FHLMC Multifamily Structured Pass Through
C6					Certificates
5.71%, 07/10/2017 ^(e),(g)		36,000	34,208		0.75%, 03/25/2020 ^(g)		154,253		5,017
5.71%, 12/10/2049 ^(g)		26,680	25,770		1.17%, 01/25/2021 ^(g)		62,011		3,731
Citigroup Commercial Mortgage Trust 2012-					1.39%, 11/25/2019 ^(g)		59,266		3,370
GC8					1.46%, 04/25/2041 ^(g)		86,714		6,017
4.88%, 09/10/2045 ^(e),(g)		1,875	1,677		1.47%, 08/25/2020 ^(g)		29,573		1,881
Citigroup Commercial Mortgage Trust 2013-					1.66%, 06/25/2042 ^(g)		13,000		876
GC15					1.67%, 08/25/2040 ^(g)		41,070		2,826
4.25%, 09/10/2046 ^(e),(g)		16,492	13,545		1.70%, 04/25/2045 ^(g)		48,322		3,207
5.11%, 09/10/2046 ^(e),(g)		18,100	17,804		1.72%, 08/25/2016 ^(g)		27,886		625
COMM 2012-CCRE1 Mortgage Trust					1.72%, 04/25/2017 ^(g)		100,097		3,277
2.46%, 05/15/2045 ^(e)		13,993	10,403		1.90%, 11/25/2039 ^(g)		28,598		1,939
5.36%, 05/15/2045 ^(e),(g)		3,139	3,265		2.00%, 09/25/2039 ^(g)		32,000		2,227
COMM 2012-CCRE5 Mortgage Trust					2.09%, 10/25/2025 ^(g)		47,224		3,379
4.34%, 12/10/2045 ^(e),(g)		3,275	3,296		2.21%, 12/25/2039 ^(g)		15,514		2,011
COMM 2013-CCRE11 Mortgage Trust					2.29%, 01/25/2041 ^(g)		15,805		1,934
0.88%, 10/10/2046 ^(c),(e),(g)		40,266	2,227		2.53%, 07/25/2039 ^(g)		89,000		7,250
4.37%, 10/10/2046 ^(e),(g)		5,108	4,324		2.58%, 11/25/2041 ^(g)		25,000		3,832
5.17%, 10/10/2046 ^(e),(g)		13,519	13,297		2.58%, 12/25/2043 ^(g)		18,309		2,500
Comm 2013-CCRE13 Mortgage Trust					2.79%, 08/25/2039 ^(g)		8,877		1,429
4.76%, 12/10/2023 ^(e),(g)		11,000	9,449		2.79%, 01/25/2043 ^(g)		8,000		1,206
COMM 2013-CCRE6 Mortgage Trust					3.22%, 02/25/2042 ^(g)		21,495		3,876
1.53%, 03/10/2046 ^(g)		88,647	6,047		3.61%, 06/25/2041 ^(g)		4,400		870
4.17%, 03/10/2046 ^(e),(g)		16,400	15,287		4.60%, 11/25/2044		1,800		433
4.17%, 03/10/2046 ^(e),(g)		10,500	8,802		GE Capital Commercial Mortgage Corp
COMM 2013-CCRE7 Mortgage Trust					4.87%, 06/10/2048 ^(g)		3,742		3,764
4.35%, 03/10/2046 ^(e),(g)		2,500	2,328		GE Commercial Mortgage Corp Series 2007-
COMM 2013-LC6 Mortgage Trust					C1 Trust
4.29%, 01/10/2046 ^(e),(g)		15,205	14,409		5.54%, 12/10/2049 ^(e)		9,000		9,438
Comm 2014-Ccre14 Mortgage Trust					5.61%, 12/10/2049 ^(g)		10,000		10,528
3.50%, 02/10/2047 ^(e)		18,498	14,148		GS Mortgage Securities Corp II
COMM 2014-CCRE17 Mortgage Trust					4.85%, 11/10/2045 ^(e),(g)		10,000		9,812
4.80%, 05/10/2047 ^(e),(g)		4,750	4,530		4.85%, 11/10/2045 ^(e),(g)		8,500		7,444
Comm 2014-UBS2 Mortgage Trust					GS Mortgage Securities Trust 2006-GG6
5.02%, 03/10/2047 ^(e),(g)		9,500	9,039		5.55%, 04/10/2038 ^(g)		12,004		12,103
COMM 2014-UBS3 Mortgage Trust					GS Mortgage Securities Trust 2010-C2
4.82%, 06/10/2047 ^(e)		18,500	17,190		5.22%, 12/10/2043 ^(e),(g)		10,000		10,478
COMM 2014-UBS5 Mortgage Trust					GS Mortgage Securities Trust 2011-GC5
3.49%, 09/10/2047 ^(e),(g)		4,000	3,281		5.31%, 08/10/2044 ^(e),(g)		20,000		21,063
Commercial Mortgage Trust 2007-GG9					5.31%, 08/10/2044 ^(e),(g)		3,660		3,416
5.51%, 03/10/2039		53,926	48,062		GS Mortgage Securities Trust 2012-GC6
5.53%, 03/10/2039		9,000	4,724		0.20%, 01/10/2045 ^(e),(g)		226,539		2,671
Credit Suisse Commercial Mortgage Trust					JP Morgan Chase Commercial Mortgage
Series 2006-C1					Securities Trust 2005-CIBC12
5.46%, 02/15/2039 ^(g)		10,045	10,298		4.99%, 09/12/2037		200		204
5.46%, 02/15/2039 ^(g)		3,790	3,844		JP Morgan Chase Commercial Mortgage
5.46%, 02/15/2039 ^(g)		19,700	19,127		Securities Trust 2005-LDP1
5.46%, 02/15/2039 ^(e),(g)		23,036	21,627		5.40%, 03/15/2046 ^(e),(g)		13,300		13,251
Credit Suisse Commercial Mortgage Trust					JP Morgan Chase Commercial Mortgage
Series 2006-C4					Securities Trust 2005-LDP4
5.54%, 09/15/2039 ^(g)		29,489	29,758		5.13%, 10/15/2042		7,800		7,310
Credit Suisse Commercial Mortgage Trust					JP Morgan Chase Commercial Mortgage
Series 2007-C1					Securities Trust 2006-CIBC14
5.42%, 02/15/2040		15,000	15,297		5.46%, 12/12/2044 ^(g)		18,340		18,178
5.46%, 02/15/2040		35,000	17,676		JP Morgan Chase Commercial Mortgage
					Securities Trust 2006-CIBC16
					5.62%, 05/12/2045		20,140		20,600


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



			Principal					Principal
	BONDS (continued)		Amount (000's)	Value(000	's)	BONDS (continued)		Amount (000's) Value (000's)

	Mortgage Backed Securities (continued)					Mortgage Backed Securities (continued)
	JP Morgan Chase Commercial Mortgage					LB-UBS Commercial Mortgage Trust 2005-
	Securities Trust 2006-CIBC17					C3
	5.49%, 12/12/2043	$	30,435	$ 21,814		4.95%, 07/15/2040 ^(g)	$	5,000	$	5,025
	JP Morgan Chase Commercial Mortgage					LB-UBS Commercial Mortgage Trust 2006-
	Securities Trust 2006-LDP6					C6
	5.50%, 04/15/2043 ^(g)		5,599	5,637		5.47%, 09/15/2039 ^(g)		8,500		8,677
	JP Morgan Chase Commercial Mortgage					LB-UBS Commercial Mortgage Trust 2006-
	Securities Trust 2006-LDP7					C7
	5.86%, 04/15/2045 ^(g)		9,000	9,071		5.41%, 11/15/2038		33,000		29,237
	JP Morgan Chase Commercial Mortgage					LB-UBS Commercial Mortgage Trust 2007-
	Securities Trust 2006-LDP8					C1
	5.52%, 05/15/2045 ^(g)		8,628	8,900		5.48%, 02/15/2040		10,000		10,407
	JP Morgan Chase Commercial Mortgage					LB-UBS Commercial Mortgage Trust 2007-
	Securities Trust 2006-LDP9					C6
	5.34%, 05/15/2047		1,000	1,003		6.13%, 07/15/2040 ^(g)		22,000		22,792
	JP Morgan Chase Commercial Mortgage					6.15%, 07/15/2040 ^(g)		13,250		13,663
	Securities Trust 2007-C1					6.15%, 07/15/2040 ^(g)		8,841		8,680
	5.96%, 02/15/2051 ^(g)		17,000	18,357		LB-UBS Commercial Mortgage Trust 2007-
	JP Morgan Chase Commercial Mortgage					C7
	Securities Trust 2007-CIBC19					6.25%, 09/15/2045 ^(g)		10,500		11,105
	5.70%, 02/12/2049 ^(g)		35,000	31,779		LB-UBS Commercial Mortgage Trust 2008-
	JP Morgan Chase Commercial Mortgage					C1
	Securities Trust 2007-CIBC20					6.15%, 04/15/2041 ^(g)		13,964		12,530
	6.17%, 02/12/2051 ^(e),(g)		5,755	6,015		Merrill Lynch Mortgage Trust 2005-LC1
	JP Morgan Chase Commercial Mortgage					5.36%, 01/12/2044 ^(g)		2,300		2,385
	Securities Trust 2010-C1					Merrill Lynch Mortgage Trust 2006-C1
	3.77%, 06/15/2043 ^(e)		5,000	4,375		5.67%, 05/12/2039 ^(g)		15,000		11,899
	JP Morgan Chase Commercial Mortgage					Merrill Lynch Mortgage Trust 2006-C2
	Securities Trust 2010-CNTR					5.80%, 08/12/2043 ^(g)		28,000		28,494
	2.02%, 08/05/2032 ^(e),(g)		12,190	1,013		ML-CFC Commercial Mortgage Trust 2006-
	JP Morgan Chase Commercial Mortgage					3
	Securities Trust 2011-C3					5.48%, 07/12/2046 ^(g)		24,265		24,808
	4.41%, 02/15/2046 ^(e)		4,330	3,895		5.52%, 07/12/2046 ^(g)		15,825		13,895
	5.57%, 02/15/2046 ^(e),(g)		4,331	4,482		5.55%, 07/12/2046 ^(g)		2,500		1,902
	JP Morgan Chase Commercial Mortgage					ML-CFC Commercial Mortgage Trust 2006-
	Securities Trust 2011-C5					4
	5.32%, 08/15/2046 ^(e),(g)		4,844	5,110		5.24%, 12/12/2049 ^(g)		18,280		18,398
	JP Morgan Chase Commercial Mortgage					ML-CFC Commercial Mortgage Trust 2007-
	Securities Trust 2012-C6					5
	2.97%, 05/15/2045 ^(e)		7,500	5,799		5.45%, 08/12/2048		14,700		14,240
	JP Morgan Chase Commercial Mortgage					ML-CFC Commercial Mortgage Trust 2007-
	Securities Trust 2013-C16					9
	3.74%, 12/15/2046 ^(e)		10,000	7,834		0.37%, 09/12/2049 ^(g)		15,768		63
	5.01%, 12/15/2046 ^(e),(g)		11,953	11,709		6.19%, 09/12/2049 ^(g)		35,000		34,437
	JP Morgan Chase Commercial Mortgage					Morgan Stanley Bank of America Merrill
	Securities Trust 2013-LC11					Lynch Trust 2012-C5
	0.99%, 04/15/2046 ^(e),(g)		49,841	3,009		4.68%, 08/15/2045 ^(e),(g)		6,787		6,823
	JPMBB Commercial Mortgage Securities					Morgan Stanley Bank of America Merrill
	Trust 2013-C12					Lynch Trust 2013-C10
	4.09%, 07/15/2045 ^(g)		16,826	15,613		4.08%, 07/15/2046 ^(e),(g)		5,609		5,189
	JPMBB Commercial Mortgage Securities					Morgan Stanley Bank of America Merrill
	Trust 2013-C15					Lynch Trust 2013-C11
	5.08%, 11/15/2045 ^(e),(g)		18,750	18,613		0.79%, 08/15/2046 ^(g)		167,364		5,006
	JPMBB Commercial Mortgage Securities					Morgan Stanley Bank of America Merrill
	Trust 2014-C18					Lynch Trust 2013-C8
	4.81%, 02/15/2047 ^(e),(g)		10,000	9,456		1.49%, 12/15/2048 ^(g)		67,277		4,313
	JPMBB Commercial Mortgage Securities					4.17%, 12/15/2048 ^(e),(g)		18,500		17,412
	Trust 2014-C23					Morgan Stanley Bank of America Merrill
	0.89%, 09/15/2047 ^(g)		444,965	23,479		Lynch Trust 2013-C9
	JPMBB Commercial Mortgage Securities					4.16%, 05/15/2046 ^(e),(g)		4,150		3,516
	Trust 2014-C24					Morgan Stanley Bank of America Merrill
	1.24%, 11/15/2047 ^(g)		130,000	9,158		Lynch Trust 2014-C14
	4.08%, 11/15/2047 ^(e),(g)		4,500	3,919		4.83%, 02/15/2047 ^(e),(g)		7,331		6,538
	LB Commercial Mortgage Trust 2007-C3					Morgan Stanley Bank of America Merrill
	5.90%, 07/15/2044 ^(g)		5,000	5,049		Lynch Trust 2014-C16
	5.90%, 07/15/2044 ^(g)		12,738	12,582		4.76%, 06/15/2047 ^(g)		5,510		5,663
	LB-UBS Commercial Mortgage Trust 2003-					4.76%, 06/15/2047 ^(e),(g)		9,500		8,887
	C8					Morgan Stanley Bank of America Merrill
	0.19%, 09/15/2037 ^(e),(g)		936	—		Lynch Trust 2014-C18
	LB-UBS Commercial Mortgage Trust 2004-					1.00%, 10/15/2047 ^(g)		101,966		5,902
	C1					Morgan Stanley Capital I Trust 2006-HQ10
	5.00%, 01/15/2036		1,000	1,015		5.39%, 11/12/2041 ^(g)		16,450		16,924


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



	Principal						Principal
BONDS (continued)	Amount (000's) Value (000's)				BONDS (continued)		Amount (000's) Value (000's)

Mortgage Backed Securities (continued)					Oil & Gas (continued)
Morgan Stanley Capital I Trust 2007-HQ13					Atlas Energy Holdings Operating Co LLC /
5.93%, 12/15/2044	$	14,275	$	13,664	Atlas Resource Finance Corp
Morgan Stanley Capital I Trust 2011-C3					7.75%, 01/15/2021	$	5,900	$	5,310
1.26%, 07/15/2049 ^(e),(g)		40,774		1,587	7.75%, 01/15/2021 ^(e)		5,000		4,500
MSBAM Commercial Mortgage Securities					9.25%, 08/15/2021		11,665		11,198
Trust 2012-CKSV					Bill Barrett Corp
3.28%, 10/15/2022 ^(e)		5,000		4,872	7.00%, 10/15/2022		15,200		14,440
UBS Commercial Mortgage Trust 2012-C1					7.63%, 10/01/2019		5,295		5,348
0.34%, 05/10/2045 ^(e),(g)		143,076		3,454	Bonanza Creek Energy Inc
UBS-Barclays Commercial Mortgage Trust					6.75%, 04/15/2021		5,840		5,855
2012-C2					BreitBurn Energy Partners LP / BreitBurn
1.76%, 05/10/2063 ^(e),(g)		37,088		3,025	Finance Corp
UBS-Barclays Commercial Mortgage Trust					7.88%, 04/15/2022		24,821		23,813
2012-C3					8.63%, 10/15/2020		3,820		3,896
4.96%, 08/10/2049 ^(e),(g)		16,000		16,277	Carrizo Oil & Gas Inc
4.96%, 08/10/2049 ^(e),(g)		20,994		18,616	7.50%, 09/15/2020		1,975		1,995
UBS-Barclays Commercial Mortgage Trust					7.50%, 09/15/2020 ^(e)		4,400		4,444
2012-C4					Denbury Resources Inc
4.50%, 12/10/2045 ^(e),(g)		13,000		12,596	5.50%, 05/01/2022		8,300		8,176
4.50%, 12/10/2045 ^(e),(g)		2,500		2,142	Diamondback Energy Inc
UBS-Barclays Commercial Mortgage Trust					7.63%, 10/01/2021 ^(e)		5,800		6,170
2013-C5					Ecopetrol SA
4.09%, 03/10/2046 ^(e),(g)		9,150		8,481	5.88%, 05/28/2045		6,054		6,220
Wachovia Bank Commercial Mortgage Trust					Endeavor Energy Resources LP / EER Finance
Series 2006-C26					Inc
6.00%, 06/15/2045 ^(g)		12,927		13,055	7.00%, 08/15/2021 ^(e)		18,650		18,837
Wachovia Bank Commercial Mortgage Trust					GeoPark Latin America Ltd Agencia en Chile
Series 2006-C29					7.50%, 02/11/2020 ^(e)		3,520		3,731
5.37%, 11/15/2048		30,879		30,713	IronGate Energy Services LLC
Wachovia Bank Commercial Mortgage Trust					11.00%, 07/01/2018 ^(e)		2,400		2,304
Series 2007-C30					Jones Energy Holdings LLC / Jones Energy
5.41%, 12/15/2043 ^(g)		12,715		13,072	Finance Corp
5.46%, 12/15/2043 ^(g)		6,778		6,508	6.75%, 04/01/2022 ^(e)		5,350		5,109
5.48%, 12/15/2043		5,500		5,123	KazMunayGas National Co JSC
Wachovia Bank Commercial Mortgage Trust					4.40%, 04/30/2023 ^(e)		13,758		13,510
Series 2007-C34					4.88%, 05/07/2025 ^(c),(e),(h)		2,282		2,268
6.03%, 05/15/2046 ^(g)		8,718		8,043	5.75%, 04/30/2043 ^(e)		2,841		2,763
Wachovia Commercial Mortgage Securities					5.75%, 04/30/2043		1,005		977
Inc Commercial Mortgage Pass Through					6.38%, 04/09/2021 ^(e)		3,053		3,351
Certificates Series 2003 C5					6.38%, 04/09/2021		5,457		5,989
2.16%, 06/15/2035 ^(e),(g)		526		22	7.00%, 05/05/2020		9,449		10,644
Wells Fargo Commercial Mortgage Trust					7.00%, 05/05/2020 ^(e)		2,110		2,377
0.58%, 11/15/2043 ^(e),(g)		13,678		418	9.13%, 07/02/2018 ^(e)		2,395		2,832
WFRBS Commercial Mortgage Trust 2011-					Keane Group Holdings
C4					8.75%, 08/08/2019 ^(b),(c),(g)		2,288		2,243
0.72%, 06/15/2044 ^(e),(g)		118,004		2,927	8.75%, 08/08/2019 ^(b),(c),(g)		6,863		6,729
WFRBS Commercial Mortgage Trust 2013-					Legacy Reserves LP / Legacy Reserves
C11					Finance Corp
4.18%, 03/15/2045 ^(e),(g)		9,900		8,272	6.63%, 12/01/2021		10,491		10,176
WFRBS Commercial Mortgage Trust 2014-					6.63%, 12/01/2021 ^(e)		11,770		11,417
C22					8.00%, 12/01/2020		14,228		14,335
3.77%, 09/15/2057 ^(g)		8,500		8,145	Lonestar Resources America Inc
3.91%, 09/15/2057 ^(e)		15,000		13,090	8.75%, 04/15/2019 ^(e)		2,850		2,622
WFRBS Commercial Mortgage Trust 2014-					MEG Energy Corp
C24					6.50%, 03/15/2021 ^(e)		4,000		3,960
3.69%, 11/15/2047 ^(c),(e),(h)		6,047		5,140	Memorial Production Partners LP / Memorial
		$		1,575,678	Production Finance Corp
					6.88%, 08/01/2022 ^(e)		11,190		10,127
Municipals - 0.01%					7.63%, 05/01/2021		12,257		11,874
Bogota Distrito Capital					Memorial Resource Development Corp
9.75%, 07/26/2028	COP	1,900,000		1,115	5.88%, 07/01/2022 ^(e)		5,000		4,875
					Milagro Oil & Gas Inc
Office & Business Equipment - 0.08%					0.00%, 05/15/2016 ^(a),(b)		5,765		4,036
CDW LLC / CDW Finance Corp					Northern Blizzard Resources Inc
6.00%, 08/15/2022	$	6,250		6,594	7.25%, 02/01/2022 ^(e)		3,966		3,768
8.50%, 04/01/2019		1,268		1,344	Northern Oil and Gas Inc
		$		7,938	8.00%, 06/01/2020		8,067		7,522
					Nostrum Oil & Gas Finance BV
Oil & Gas - 5.22%					6.38%, 02/14/2019 ^(e)		1,318		1,321
Antero Resources Corp					Oasis Petroleum Inc
5.13%, 12/01/2022 ^(e)		3,300		3,301
					6.88%, 03/15/2022		2,700		2,808


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



		Principal				Principal
BONDS (continued)		Amount (000's)	Value(000	's)	BONDS (continued)	Amount (000's) Value (000's)

Oil & Gas (continued)					Oil & Gas (continued)
Odebrecht Drilling Norbe VIII/IX Ltd					Zhaikmunai LLP
6.35%, 06/30/2021	$	1,247	$ 1,316		7.13%, 11/13/2019 ^(e)	$	6,277	$	6,528
Pacific Drilling SA							$		519,434
5.38%, 06/01/2020 ^(e)		1,550	1,386
Pacific Rubiales Energy Corp					Oil & Gas Services - 0.15%
5.13%, 03/28/2023 ^(e)		3,591	3,438		BIBBY Offshore Services PLC
Pertamina Persero PT					7.50%, 06/15/2021	GBP	1,600		2,419
4.30%, 05/20/2023 ^(e)		5,503	5,352		EDC Finance Ltd
					4.88%, 04/17/2020 ^(e)	$	1,549		1,402
5.25%, 05/23/2021		1,000	1,050
6.50%, 05/27/2041		320	339		FTS International Inc
					6.25%, 05/01/2022 ^(e)		7,893		7,459
Petroleos de Venezuela SA
5.25%, 04/12/2017		31,862	21,124		Trinidad Drilling Ltd
					7.88%, 01/15/2019 ^(e)		3,770		3,845
6.00%, 05/16/2024		39,465	20,301
6.00%, 11/15/2026		3,453	1,688				$		15,125
8.50%, 11/02/2017		57,782	43,764		Packaging & Containers - 0.37%
9.00%, 11/17/2021		11,561	7,327		Ardagh Packaging Finance PLC
9.75%, 05/17/2035		6,413	3,915		9.25%, 10/15/2020	EUR	4,105		5,504
Petroleos Mexicanos					Ardagh Packaging Finance PLC / Ardagh
6.50%, 06/02/2041		700	819		Holdings USA Inc
Precision Drilling Corp					4.25%, 01/15/2022		3,000		3,666
5.25%, 11/15/2024 ^(e)		6,400	5,952		Crown European Holdings SA
6.63%, 11/15/2020		2,500	2,575		4.00%, 07/15/2022		1,500		1,920
PTT Exploration & Production PCL					OI European Group BV
4.88%, 12/29/2049 ^(e),(g)		6,955	7,068		4.88%, 03/31/2021		2,855		3,846
Puma International Financing SA					Reynolds Group Issuer Inc / Reynolds Group
6.75%, 02/01/2021 ^(e)		6,954	7,145		Issuer LLC / Reynolds Group Issuer
QEP Resources Inc					(Luxembourg) S.A.
5.25%, 05/01/2023		5,400	5,252		5.75%, 10/15/2020	$	5,700		5,928
Rex Energy Corp					6.88%, 02/15/2021 ^(g)		7,900		8,394
6.25%, 08/01/2022 ^(e)		7,200	6,768		7.13%, 04/15/2019		4,000		4,155
8.88%, 12/01/2020		5,000	5,275		SGD Group SAS
Rosetta Resources Inc					5.63%, 05/15/2019	EUR	3,100		3,728
5.88%, 06/01/2022		4,200	4,032				$		37,141
5.88%, 06/01/2024		3,000	2,880
Sanchez Energy Corp					Pharmaceuticals - 0.32%
6.13%, 01/15/2023 ^(e)		2,250	2,143		Almirall SA
SandRidge Energy Inc					4.63%, 04/01/2021		2,500		3,283
7.50%, 03/15/2021		7,700	6,930		Capsugel SA
8.13%, 10/15/2022		6,600	5,973		7.00%, PIK 7.75%, 05/15/2019 ^(e),(f)	$	5,775		5,872
Seven Generations Energy Ltd					Grifols Worldwide Operations Ltd
8.25%, 05/15/2020 ^(e)		7,100	7,455		5.25%, 04/01/2022 ^(e)		3,300		3,383
Sinopec Capital 2013 Ltd					JLL/Delta Dutch Newco BV
3.13%, 04/24/2023 ^(e)		2,639	2,519		7.50%, 02/01/2022 ^(e)		12,200		12,411
Sinopec Group Overseas Development 2012					Valeant Pharmaceuticals International
Ltd					6.38%, 10/15/2020 ^(e)		3,275		3,361
4.88%, 05/17/2042 ^(e)		1,053	1,115		6.88%, 12/01/2018 ^(e)		3,818		3,952
Sinopec Group Overseas Development 2013							$		32,262
Ltd					Pipelines - 0.53%
4.38%, 10/17/2023		3,293	3,440		Atlas Pipeline Partners LP / Atlas Pipeline
Sinopec Group Overseas Development 2014					Finance Corp
Ltd					4.75%, 11/15/2021		4,275		4,264
4.38%, 04/10/2024 ^(e)		1,895	1,979
					5.88%, 08/01/2023		5,350		5,551
SM Energy Co					6.63%, 10/01/2020		7,475		7,924
5.00%, 01/15/2024		2,125	1,987		Crestwood Midstream Partners LP /
State Oil Co of the Azerbaijan Republic					Crestwood Midstream Finance Corp
4.75%, 03/13/2023		7,340	7,289		6.13%, 03/01/2022		3,247		3,279
5.45%, 02/09/2017		2,161	2,258		Enterprise Products Operating LLC
Summit Midstream Holdings LLC / Summit					7.03%, 01/15/2068 ^(g)		2,950		3,282
Midstream Finance Corp					Gibson Energy Inc
5.50%, 08/15/2022		900	900		6.75%, 07/15/2021 ^(e)		12,800		13,600
Teine Energy Ltd					Rose Rock Midstream LP / Rose Rock
6.88%, 09/30/2022 ^(e)		4,000	3,790
					Finance Corp
Tullow Oil PLC					5.63%, 07/15/2022 ^(e)		2,325		2,319
6.00%, 11/01/2020 ^(e)		6,497	6,075
					Sabine Pass Liquefaction LLC

Ultra Petroleum Corp					5.63%, 04/15/2023		3,700		3,830
5.75%, 12/15/2018 (e)		3,800	3,762		5.63%, 04/15/2023 ^(e)		1,500		1,553
Unit Corp					5.75%, 05/15/2024 ^(e)		2,500		2,584
6.63%, 05/15/2021		11,640	11,611		6.25%, 03/15/2022 ^(e)		4,224		4,551
YPF SA
8.75%, 04/04/2024 ^(e)		7,490	7,743				$		52,737


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



		Principal					Principal
	BONDS (continued)	Amount (000's) Value (000's)				BONDS (continued)	Amount (000's) Value (000's)

	Publicly Traded Investment Fund - 0.12%					Software (continued)
	Drawbridge Special Opportunities Fund LP					Emdeon Inc
	5.00%, 08/01/2021 ^(e)	$	12,300	$	12,239	11.00%, 12/31/2019	$	1,669	$	1,851
						Epicor Software Corp
						8.63%, 05/01/2019		7,075		7,526
	Real Estate - 0.08%					First Data Corp
	China Overseas Finance Cayman V Ltd					6.75%, 11/01/2020 ^(e)		3,246		3,473
	3.95%, 11/15/2022		1,800		1,705	Infor US Inc
	Country Garden Holdings Co Ltd					10.00%, 04/01/2019	EUR	4,675		6,532
	11.13%, 02/23/2018		1,744		1,864

	Kaisa Group Holdings Ltd					Nuance Communications Inc	$	12,082		12,142
	8.88%, 03/19/2018 ^(e)		2,300		2,323	5.38% ,08/15/2020 ^(e)
						Southern Graphics Inc
	Longfor Properties Co Ltd					8.38%, 10/15/2020 ^(e)		4,025		4,146
	6.88%, 10/18/2019		2,100		2,147
			$		8,039			$		73,785
						Sovereign - 10.37%
	Regional Authority - 0.11%					Argentina Boden Bonds
	Brazil Loan Trust 1
	5.48%, 07/24/2023 ^(c),(e)		10,266		10,677	7.00%, 10/03/2015		30,888		28,867
						Argentina Bonar Bonds
						7.00%, 04/17/2017		40,002		35,393
	REITS- 0.21%					Argentine Republic Government International
	Crown Castle International Corp					Bond
	5.25%, 01/15/2023		3,080		3,153	0.00%, 11/14/2002 ^(a)	EUR	734		706
	Geo Group Inc/The					0.00%, 03/04/2004 ^(a)		545		524
	5.88%, 10/15/2024		5,200		5,356	0.00%, 09/07/2007 ^(a)		532		512
	Iron Mountain Inc					0.00%, 05/26/2009 ^(a)		2,200		2,116
	5.75%, 08/15/2024		4,300		4,386	0.00%, 03/31/2023 ^(a)	$	4,000		4,358
	MPT Operating Partnership LP / MPT Finance					9.75%, 11/26/2003	EUR	320		308
	Corp					Banco Nacional de Desenvolvimento
	5.75%, 10/01/2020	EUR	1,700		2,274	Economico e Social
	6.38%, 02/15/2022	$	2,000		2,125	5.50%, 07/12/2020	$	1,080		1,156
	Sabra Health Care LP / Sabra Capital Corp					Brazil Minas SPE via State of Minas Gerais
	5.50%, 02/01/2021		3,500		3,632	5.33%, 02/15/2028 ^(g)		6,307		6,339
			$		20,926	Brazilian Government International Bond
						4.25%, 01/07/2025		26,268		26,688
	Retail - 0.98%					7.13%, 01/20/2037		8,200		10,353
	1011778 BC ULC / New Red Finance Inc					8.25%, 01/20/2034		4,587		6,353
	6.00%, 04/01/2022 ^(e)		19,920		20,194
						Colombia Government International Bond
	AmeriGas Finance LLC/AmeriGas Finance					4.00%, 02/26/2024		4,967		5,096
	Corp					4.38%, 07/12/2021		2,586		2,758
	6.75%, 05/20/2020		1,000		1,065	7.38%, 09/18/2037		2,685		3,618
	7.00%, 05/20/2022		6,290		6,793	7.75%, 04/14/2021	COP	3,538,000		1,871
	Checkers Drive-In Restaurants Inc					8.13%, 05/21/2024	$	2,392		3,187
	11.00%, 12/01/2017 ^(e)		5,400		5,899
						9.85%, 06/28/2027	COP	6,738,000		4,191
	GRD Holdings III Corp					11.75%, 02/25/2020	$	4,493		6,391
	10.75%, 06/01/2019 ^(e)		17,840		19,691
						10.38%, 01/28/2033		2,625		4,121
	Group 1 Automotive Inc					Costa Rica Government International Bond
	5.00%, 06/01/2022 ^(e)		3,332		3,299
						4.25%, 01/26/2023		21,154		20,096
	Guitar Center Inc					4.38%, 04/30/2025 ^(e)		11,307		10,516
	6.50%, 04/15/2019 ^(e)		10,145		9,251
						4.38%, 04/30/2025		5,000		4,650
	Hillman Group Inc/The					7.00%, 04/04/2044 ^(e)		1,572		1,623
	6.38%, 07/15/2022 ^(e)		3,025		2,942
						Croatia Government International Bond
	Men's Wearhouse Inc/The					5.50%, 04/04/2023		4,694		4,914
	7.00%, 07/01/2022 ^(e)		1,225		1,269
						6.63%, 07/14/2020		9,666		10,723
	Party City Holdings Inc					6.75%, 11/05/2019		8,359		9,268
	8.88%, 08/01/2020		5,000		5,425	Dominican Republic International Bond
	Rite Aid Corp					5.88%, 04/18/2024 ^(e)		24,044		25,366
	6.75%, 06/15/2021		11,060		11,807	6.60%, 01/28/2024		8,550		9,469
	Stonegate Pub Co Financing PLC					7.45%, 04/30/2044 ^(e)		6,744		7,536
	5.75%, 04/15/2019	GBP	2,250		3,554	7.50%, 05/06/2021		16,583		18,863
	Suburban Propane Partners LP/Suburban					El Salvador Government International Bond
	Energy Finance Corp					6.38%, 01/18/2027 ^(e)		5,313		5,446
	5.50%, 06/01/2024	$	6,400		6,352	7.38%, 12/01/2019		3,500		3,894
			$		97,541	7.65%, 06/15/2035		5,700		6,213
	Software - 0.74%					7.75%, 01/24/2023		7,288		8,272
	Aspect Software Inc					8.25%, 04/10/2032		4,231		4,929
	10.63%, 05/15/2017		13,326		13,160	Export Credit Bank of Turkey
	Audatex North America Inc					5.38%, 11/04/2016 ^(e)		250		263
	6.00%, 06/15/2021 ^(e)		15,400		16,285	Financing of Infrastrucural Projects State
	Eagle Midco Inc					Enterprise
	9.00%, PIK 9.75%, 06/15/2018 ^(e),(f)		8,500		8,670	9.00%, 12/07/2017		6,746		5,768
						Gabonese Republic
						6.38%, 12/12/2024 ^(e)		6,682		7,083


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



	Principal					Principal
BONDS (continued)	Amount (000's)		Value(000	's)	BONDS (continued)	Amount (000's) Value (000's)

Sovereign (continued)					Sovereign (continued)
Honduras Government International Bond					Republic of Iraq
7.50%, 03/15/2024	$	4,583	$ 4,938		5.80%, 01/15/2028	$	19,576	$	17,276
Hungary Government International Bond					Republic of Paraguay
5.75%, 11/22/2023		12,284	13,512		6.10%, 08/11/2044 ^(e)		1,482		1,588
6.00%, 01/11/2019	EUR	3,738	5,393		Republic of Serbia
Indonesia Government International Bond					5.88%, 12/03/2018		1,014		1,074
3.38%, 04/15/2023 ^(e)	$	18,272	17,495		5.88%, 12/03/2018 ^(e)		9,469		10,031
3.75%, 04/25/2022		268	267		7.25%, 09/28/2021		4,783		5,498
4.88%, 05/05/2021		4,218	4,508		Romanian Government International Bond
5.25%, 01/17/2042		2,766	2,773		4.88%, 01/22/2024 ^(e)		1,920		2,069
5.25%, 01/17/2042 ^(e)		2,000	2,005		6.75%, 02/07/2022		992		1,188
5.38%, 10/17/2023		13,064	14,354		Russian Federal Bond - OFZ
5.88%, 03/13/2020		3,000	3,356		6.40%, 05/27/2020	RUB	53,840		1,067
5.88%, 03/13/2020 ^(e)		2,000	2,238		6.70%, 05/15/2019		111,300		2,286
5.88%, 01/15/2024 ^(e)		10,730	12,205		6.80%, 12/11/2019		77,910		1,594
6.88%, 01/17/2018		7,176	8,100		7.00%, 08/16/2023		638,400		12,490
7.75%, 01/17/2038		3,643	4,795		7.50%, 02/27/2019		89,740		1,913
8.50%, 10/12/2035		6,760	9,430		7.60%, 04/14/2021 ^(g)		44,890		935
11.63%, 03/04/2019		4,055	5,434		Russian Foreign Bond - Eurobond
11.63%, 03/04/2019 ^(e)		850	1,139		4.88%, 09/16/2023	$	27,600		27,640
Indonesia Treasury Bond					7.50%, 03/31/2030 ^(g)		76,813		87,143
7.00%, 05/15/2022	IDR	10,060,000	785		12.75%, 06/24/2028		2,400		3,955
7.88%, 04/15/2019		30,020,000	2,487		Slovakia Government International Bond
8.38%, 03/15/2024		74,640,000	6,309		4.38%, 05/21/2022 ^(e)		848		923
9.00%, 03/15/2029		23,100,000	2,008		Slovenia Government International Bond
Ivory Coast Government International Bond					5.25%, 02/18/2024 ^(e)		8,533		9,189
5.38%, 07/23/2024 ^(e)	$	1,872	1,807		5.85%, 05/10/2023		4,209		4,722
5.38%, 07/23/2024		1,000	963		South Africa Government International Bond
7.77%, 12/31/2032 ^(g)		21,160	20,424		4.67%, 01/17/2024		7,242		7,532
Jamaica Government International Bond					5.88%, 09/16/2025		32,634		36,876
7.63%, 07/09/2025		14,745	15,759		Sri Lanka Government International Bond
10.63%, 06/20/2017		1,000	1,150		5.13%, 04/11/2019 ^(e)		694		714
Kazakhstan Government International Bond					Turkey Government International Bond
3.88%, 10/14/2024 ^(e)		4,798	4,714		3.25%, 03/23/2023		7,258		6,771
Kenya Government International Bond					5.13%, 03/25/2022		4,448		4,728
6.88%, 06/24/2024 ^(e)		5,742	6,115		5.63%, 03/30/2021		8,425		9,225
Lithuania Government International Bond					5.75%, 03/22/2024		14,521		16,036
6.63%, 02/01/2022		967	1,165		6.25%, 09/26/2022		15,340		17,411
Mexican Bonos					6.63%, 02/17/2045		1,169		1,400
6.25%, 06/16/2016 ^(g)	MXN	16,573	1,282		6.88%, 03/17/2036		866		1,048
8.00%, 12/07/2023 ^(g)		179,726	15,315		7.00%, 06/05/2020		3,924		4,566
9.50%, 12/18/2014 ^(g)		9,620	720		7.38%, 02/05/2025		14,235		17,594
10.00%, 12/05/2024 ^(g)		54,944	5,334		7.50%, 11/07/2019		4,006		4,721
Mexico Government International Bond					8.00%, 02/14/2034		6,768		9,120
4.00%, 10/02/2023	$	8,952	9,346		Ukraine Government International Bond
4.75%, 03/08/2044		3,042	3,089		6.25%, 06/17/2016		1,025		912
5.55%, 01/21/2045		2,310	2,622		6.58%, 11/21/2016		3,873		3,409
5.95%, 03/19/2019		2,214	2,541		6.75%, 11/14/2017		16,556		14,445
Morocco Government International Bond					6.88%, 09/23/2015 ^(e)		6,632		6,070
4.25%, 12/11/2022 ^(e)		5,739	5,818		9.25%, 07/24/2017		7,567		6,886
Nigeria Government International Bond					Venezuela Government International Bond
6.38%, 07/12/2023 ^(e)		1,940	2,056		5.75%, 02/26/2016		30,647		26,050
6.38%, 07/12/2023		8,473	8,981		6.00%, 12/09/2020		3,148		1,873
6.75%, 01/28/2021		1,912	2,067		7.00%, 03/16/2015	EUR	1,018		1,218
Panama Government International Bond					7.00%, 12/01/2018	$	4,519		3,005
4.00%, 09/22/2024		3,101	3,171		7.75%, 10/13/2019		5,223		3,382
8.13%, 04/28/2034		9,109	12,388		8.25%, 10/13/2024		2,985		1,803
8.88%, 09/30/2027		2,019	2,892		9.00%, 05/07/2023		3,684		2,367
9.38%, 04/01/2029		4,131	6,176		11.95%, 08/05/2031		17,081		12,427
Panama Notas del Tesoro							$		1,031,120
4.88%, 02/05/2021		5,853	6,187
Peruvian Government International Bond					Telecommunications - 2.09%
5.63%, 11/18/2050		2,621	2,960		Alcatel-Lucent USA Inc
					6.75%, 11/15/2020 ^(e)		12,650		13,030
6.55%, 03/14/2037		1,109	1,417
7.35%, 07/21/2025		2,500	3,306		Altice Financing SA
					6.50%, 01/15/2022 ^(e)		4,225		4,341
Republic of Azerbaijan International Bond
4.75%, 03/18/2024 ^(e)		12,369	12,879		Altice SA
Republic of Ghana					7.25%, 05/15/2022	EUR	4,850		6,275
8.13%, 01/18/2026 ^(e)		1,632	1,640		Avaya Inc
					7.00%, 04/01/2019 ^(e)	$	2,300		2,260
8.50%, 10/04/2017		1,910	2,020
Republic of Honduras					B Communications Ltd
					7.38%, 02/15/2021 ^(e)		920		980
8.75%, 12/16/2020		6,425	7,317		7.38%, 02/15/2021 ^(e)		5,872		6,255


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



	Principal					Principal
BONDS (continued)	Amount (000's)		Value (000	's)	BONDS (continued)	Amount (000's)		Value (000's)

Telecommunications (continued)					Telecommunications (continued)
Bharti Airtel International Netherlands BV					VimpelCom Holdings BV (continued)
5.13%, 03/11/2023 ^(e)	$	3,178	$ 3,357		5.95%, 02/13/2023 ^(e)	$	1,300	$	1,194
5.35%, 05/20/2024		1,450	1,558		7.50%, 03/01/2022		2,250		2,244
Comcel Trust					Virgin Media Finance PLC
6.88%, 02/06/2024 ^(e)		5,016	5,367		6.00%, 10/15/2024 ^(e)		1,000		1,040
Digicel Group Ltd					6.38%, 04/15/2023 ^(e)		2,000		2,115
7.13%, 04/01/2022 ^(e)		3,808	3,827		6.38%, 10/15/2024 ^(e)	GBP	7,500		12,177
8.25%, 09/30/2020 ^(e)		3,700	3,867		Virgin Media Secured Finance PLC
ENTEL Chile SA					6.00%, 04/15/2021 ^(e)		2,900		4,848
4.75%, 08/01/2026 ^(e)		2,444	2,475		Wind Acquisition Finance SA
Frontier Communications Corp					7.00%, 04/23/2021	EUR	3,500		4,333
7.13%, 01/15/2023		700	746				$		208,185
Indosat Palapa Co BV
7.38%, 07/29/2020		2,875	3,055		Transportation - 0.21%
Intelsat Jackson Holdings SA					BNSF Funding Trust I
					6.61%, 12/15/2055 ^(g)	$	4,610		5,147
5.50%, 08/01/2023		4,000	4,010
InterXion Holding NV					CEVA Group PLC
					7.00%, 03/01/2021 ^(e)		4,195		4,080
6.00%, 07/15/2020	EUR	1,900	2,477
Koninklijke KPN NV					Marquette Transportation Co LLC / Marquette
6.12%, 03/29/2049 ^(g)		1,000	1,344		Transportation Finance Corp
7.00%, 03/28/2073 ^(e),(g)	$	400	417		10.88%, 01/15/2017		8,215		8,461
Level 3 Escrow II Inc					Transnet SOC Ltd
					4.00%, 07/26/2022 ^(e)		3,049		2,935
5.38%, 08/15/2022 ^(e)		10,300	10,480
Level 3 Financing Inc							$		20,623
6.13%, 01/15/2021 ^(e)		3,700	3,880		Trucking & Leasing - 0.03%
7.00%, 06/01/2020		3,030	3,235		Jurassic Holdings III Inc
Matterhorn Mobile Holdings SA					6.88%, 02/15/2021 ^(e)		3,175		3,199
8.25%, 02/15/2020	EUR	3,479	4,654
Millicom International Cellular SA					TOTAL BONDS		$		5,647,360
6.63%, 10/15/2021 ^(e)	$	3,398	3,636
						Principal
Mobile Challenger Intermediate Group SA					CONVERTIBLE BONDS - 0.06%	Amount (000's) Value (000's)
8.75%, PIK 9.50%, 03/15/2019 ^(f)	EUR	4,300	5,456
Motorola Solutions Inc					Mining - 0.06%
4.00%, 09/01/2024	$	2,700	2,655		Mirabela Nickel Ltd
Nokia OYJ					9.50%, PIK 9.50%, 06/24/2019 ^(c),(f)		5,786		5,786
6.75%, 02/04/2019	EUR	1,750	2,591
OTE PLC					TOTAL CONVERTIBLE BONDS		$		5,786
3.50%, 07/09/2020		1,050	1,283		CREDIT LINKED STRUCTURED NOTES	Principal
Portugal Telecom International Finance BV					- 0.11%		Amount (000's)		Value (000's)
4.63%, 05/08/2020		500	636
Qualitytech LP/QTS Finance Corp					Sovereign - 0.11%
5.88%, 08/01/2022 ^(e)	$	7,020	7,055		Republic of Iraq - Merrill Lynch
					2.53%, 01/07/2028 ^(b),(c),(g)	JPY	606,408		3,715
SBA Telecommunications Inc

5.75%, 07/15/2020		7,760	8,109		Titulos De Tesoreria B - Citigroup Inc	COP	12,000,000		7,230
Sprint Corp					11.00%,07/27/2020 (e)
7.25%, 09/15/2021 ^(e)		5,050	5,340				$		10,945
Sunrise Communications Holdings SA					TOTAL CREDIT LINKED STRUCTURED NOTES		$		10,945
8.50%, 12/31/2018	EUR	3,161	4,139		SENIOR FLOATING RATE INTERESTS -		Principal
TBG Global Pte Ltd					5.57%		Amount (000's)		Value (000's)
4.63%, 04/03/2018 ^(e)	$	3,043	3,058
					Advertising - 0.12%
Telecom Italia SpA					Advantage Sales & Marketing Inc, Delay-
4.88%, 09/25/2020	EUR	4,450	6,109		Draw Term Loan B-DD
Telefonica Europe BV					4.25%, 07/21/2021 ^(g)	$	140		$139
5.00%, 03/31/2049 ^(g)		2,000	2,622		Advantage Sales & Marketing Inc, Term
Telenet Finance V Luxembourg SCA					Loan
6.25%, 08/15/2022		3,825	5,189		7.50%, 07/21/2022 ^(g)		3,900		3,870
T-Mobile USA Inc					Advantage Sales & Marketing Inc, Term Loan
6.00%, 03/01/2023	$	6,600	6,798		B
6.50%, 01/15/2024		2,625	2,750		4.25%, 07/21/2021 ^(g)		8,177		8,099
Turk Telekomunikasyon AS							$		12,108
4.88%, 06/19/2024 ^(e)		6,613	6,564
UPC Holding BV					Agriculture - 0.19%
6.38%, 09/15/2022	EUR	4,400	5,951		Arysta Lifescience SPC LLC, Term Loan
8.38%, 08/15/2020		4,090	5,510		8.25%, 11/20/2020 ^(g)		2,575		2,590
ViaSat Inc					North Atlantic Trading Co Inc, Term Loan B
6.88%, 06/15/2020	$	3,000	3,173		7.75%, 01/13/2020 ^(g)		8,031		8,071
Vimpel Communications Via VIP Finance					NVA Holdings Inc/United States, Term Loan
Ireland Ltd OJSC					8.00%, 08/08/2022 ^(g)		6,100		6,039
7.75%, 02/02/2021		500	509		NVA Holdings Inc/United States, Term Loan
9.13%, 04/30/2018 ^(e)		1,500	1,618		B
VimpelCom Holdings BV					4.75%, 08/06/2021 ^(g)		2,500		2,478
5.20%, 02/13/2019 ^(e)		1,640	1,593				$		19,178


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



	SENIOR FLOATING RATE INTERESTS			Principal			SENIOR FLOATING RATE INTERESTS			Principal
	(continued)			Amount (000's)	Value (000's)		(continued)			Amount (000's)	Value (000's)

	Airlines - 0.00%						Diversified Financial Services (continued)
	Global Aviation Holdings Inc, PIK Term						Sears Roebuck Acceptance Corp, Term Loan
	Loan						B
	0.00%, PIK 0.00%, 07/13/2017 ^{(a),(b),(c),(g)}		$	4,879	$	49	5.50%, 06/30/2018 ^(g)		$	8,940	$	8,675
	0.00%, PIK 0.00%, 02/13/2018 ^{(a),(b),(c),(g)}			1,595		—				$		23,328

				$		49	Electronics - 0.08%
	Automobile Parts & Equipment - 0.02%						CPI Buyer LLC, Term Loan
	BBB Industries LLC, Term Loan						8.50%, 07/18/2022 ^(g)			8,190		8,067
	0.00%, 10/15/2021 ^(g),(i)			2,000		1,970

							Engineering & Construction - 0.01%
	Building Materials - 0.13%						NANA Development Corp, Term Loan B
	CPG International Inc, Term Loan B						8.00%, 03/13/2018 ^(b),(g)			1,050		1,029
	4.75%, 09/30/2020 ^(g)			4,782		4,738
	GYP Holdings III Corp, Term Loan B
	4.75%, 03/26/2021 ^(g)			4,776		4,668	Entertainment - 0.24%
							Amaya Holdings BV, Term Loan
	Panolam Industries International Inc, Term						5.00%, 08/01/2021 ^(g)			4,000		3,966
	Loan						8.07%, 08/01/2022 ^(g)			1,750		1,766
	7.75%, 08/22/2017 ^(g)			3,676		3,658
							Delta 2 Lux Sarl, Term Loan B
				$		13,064	0.00%, 07/30/2021 ^(g),(i)			2,000		1,983
	Chemicals - 0.07%						7.75%, 07/29/2022 ^(g)			3,100		3,086
	Road Infrastructure Investment LLC, Term						7.75%, 07/29/2022 ^(g)			3,310		3,296
	Loan						Lions Gate Entertainment Corp, Term Loan
	7.75%, 09/21/2021 ^(g)			440		399	5.00%, 07/17/2020 ^(g)			9,800		9,825
	Solenis International LP, Term Loan									$		23,922
	7.75%, 07/02/2022 ^(g)			6,100		5,963
							Food- 0.37	%
				$		6,362	AdvancePierre Foods Inc, Term Loan
	Coal- 0.03	%					9.50%, 10/02/2017 ^(g)			10,781		10,660
	Arch Coal Inc, Term Loan						Albertson's Holdings LLC, Term Loan B4
	0.00%, 05/14/2018 ^(g),(i)			3,730		3,288	4.50%, 08/11/2021 ^(g)			7,500		7,501
							CTI Foods Holding Co LLC, Term Loan
							8.25%, 06/14/2019 ^(g)			3,920		3,812
	Commercial Services - 0.38%						Milk Specialties Co, Term Loan B
	Brickman Group Ltd LLC/The, Term Loan B						7.50%, 11/07/2018 ^(g)			14,564		14,309
	4.00%, 12/18/2020 ^(g)			4,389		4,309
							Old HB Inc, Term Loan B
	Catalent Pharma Solutions Inc, Term Loan						6.75%, 03/12/2020 ^(g)			597		607
	6.50%, 12/31/2017 ^(g)			250		250
	CHG Buyer Corp, Term Loan									$		36,889
	9.00%, 11/13/2020 ^(g)			3,596		3,634	Healthcare - Products - 0.28%
	Envision Acquisition Co LLC, Term Loan						Biomet Inc, Term Loan B2
	0.00%, 09/23/2021 ^(g),(i)			9,500		9,464	3.65%, 07/25/2017 ^(g)			13,573		13,531
	11.00%, 09/23/2021 ^(g)			3,300		3,288	CareCore National LLC, Term Loan
	Learning Care Group Inc, Term Loan B						5.50%, 02/12/2021 ^(g)			9,254		9,155
	5.50%, 05/03/2021 ^(g)			2,993		3,000	Phillips-Medisize Corp, Term Loan
	Lineage Logistics LLC, Term Loan B						8.25%, 06/16/2022 ^(g)			5,000		4,954
	4.50%, 03/31/2021 ^(g)			7,504		7,342				$		27,640
	Washington Inventory Service, Term Loan
	10.25%, 06/18/2019 ^(g)			6,800		6,685	Healthcare - Services - 0.72%
				$		37,972	American Renal Holdings Inc, Delay-Draw
							Term Loan DD
	Computers - 0.12%						8.50%, 02/14/2020 ^(g)			3,499		3,429
	Expert Global Solutions Inc, Term Loan B						Envision Healthcare Corp, Term Loan B
	8.50%, 04/02/2018 ^(g)			11,964		11,893	4.00%, 05/25/2018 ^(g)			19,740		19,588
	SRA International Inc, Term Loan B						Heartland Dental LLC, Term Loan
	6.50%, 07/20/2018 ^(g)			256		255	5.50%, 12/21/2018 ^(g)			6,352		6,336
				$		12,148	9.75%, 06/20/2019 ^(g)			9,050		9,118
							National Mentor Holdings Inc, Term Loan B
	Distribution & Wholesale - 0.09%						4.75%, 01/31/2021 ^(g)			8,202		8,127
	American Tire Distributors Inc, Term Loan						Surgery Center Holdings Inc, Term Loan
	5.75%, 06/19/2018 ^(g)			3,686		3,681
							0.00%, 07/23/2021 ^(g),(i)			10,000		9,806
	HBC Holdings LLC, Term Loan B						9.75%, 04/10/2020 ^(c),(g)			5,825		5,825
	7.89%, 09/30/2019 ^(g)			3,500		3,395
							US Renal Care Inc, Term Loan
	Performance Food Group Inc, Term Loan						4.25%, 07/03/2019 ^(g)			2,376		2,358
	6.25%, 11/07/2019 ^(g)			1,728		1,721
							US Renal Care Inc, Term Loan B1
				$		8,797	8.59%, 01/03/2020 ^(g)			2,900		2,900
	Diversified Financial Services - 0.24%						8.59%, 01/03/2020 ^(g)			4,080		4,080
	Connolly Corp, Term Loan									$		71,567
	8.00%, 05/13/2022 ^(g)			12,270		12,224
							Holding Companies - Diversified - 0.16%
	Intertrust Group BV, Term Loan						Opal Acquisition Inc, Term Loan B
	4.45%, 04/02/2021 ^(g)			500		492
							5.00%, 11/20/2020 ^(g)			8,009		7,970
	RCS Capital Corp, Term Loan
	6.50%, 03/29/2019 ^(g)			1,964		1,937


Schedule of Investments
Global Diversified Income Fund
October 31, 2014



	SENIOR FLOATING RATE INTERESTS			Principal			SENIOR FLOATING RATE INTERESTS		Principal
	(continued)			Amount (000's)	Value (000's)		(continued)		Amount (000's)	Value (000's)

	Holding Companies - Diversified (continued)						Metal Fabrication & Hardware (continued)
	Spirit Retail Bidco Ltd, Term Loan						SBP Holdings, Term Loan
	4.73%, 06/30/2021 ^(c),(g)		$	7,730	$	7,575	9.00%, 03/24/2022 ^(g)	$	6,825	$	6,620
				$		15,545	Wastequip LLC, Term Loan B
							5.50%, 07/26/2019 ^(g)		2,938		2,934
	Insurance - 0.12%								$		10,487
	Asurion LLC, Term Loan
	8.50%, 02/19/2021 ^(g)			10,000		10,152	Miscellaneous Manufacturing - 0.10%
	York Risk Services Group Inc, Term Loan B						Arctic Glacier USA Inc, Term Loan B
	4.75%, 10/01/2021 ^(g)			1,940		1,927	5.00%, 05/10/2019 ^(g)		1,568		1,541
				$		12,079	UTEX Industries Inc, Term Loan
							8.25%, 05/16/2022 ^(g)		5,430		5,357
	Internet - 0.27%						UTEX Industries Inc, Term Loan B
	Active Network Inc/The, Term Loan B						5.00%, 05/14/2021 ^(g)		3,392		3,343
	5.50%, 11/06/2020 ^(g)			1,592		1,576
	Blue Coat Systems Inc, Term Loan B								$		10,241
	4.00%, 02/15/2018 ^(g)			2,622		2,568	Oil & Gas - 0.03%
	EIG Investors Corp, Term Loan B						BBOG Borrower LP, Term Loan
	5.00%, 11/09/2019 ^(g)			5,444		5,431	7.50%, 07/21/2021 ^(g)		3,000		2,843
	ION Trading Technologies Sarl, Term Loan
	7.25%, 06/10/2022 ^(g)			1,850		1,819
							Oil & Gas Services - 0.15%
	Landslide Holdings Inc, Term Loan						Expro Finservices Sarl, Term Loan B
	5.00%, 02/25/2020(g)			3,663		3,623	5.75%, 08/12/2021 ^(g)		4,000		3,913
	MH Sub I LLC, Term Loan
	8.50%, 06/27/2022 ^(g)			8,000		7,820	McJunkin Red Man Corp, Term Loan B
							5.52%, 11/08/2019 ^(g)		9,372		9,384
	ProQuest LLC, Term Loan B
	0.00%, 09/24/2021 ^(g),(i)			4,000		3,996	Panda Temple Power II LLC, Term Loan B
							7.25%, 04/03/2019 ^(g)		850		862
				$		26,833	Pinnacle Holdco Sarl, Term Loan
	Investment Companies - 0.03%						10.50%, 07/24/2020 ^(g)		1,056		1,032
	AssuredPartners Capital Inc, Term Loan B								$		15,191
	4.50%, 03/31/2021 ^(g)			3,100		3,077
							Packaging & Containers - 0.13%
							Berlin Packaging LLC, Term Loan
	Leisure Products & Services - 0.17%						7.75%, 09/23/2022 ^(g)		4,130		4,113
	Equinox Holdings Inc, Term Loan						FPC Holdings Inc, Term Loan
	9.75%, 05/16/2020 ^(g)			12,500		12,609	9.25%, 05/15/2020 ^(g)		9,400		9,118
	Performance Sports Group Ltd, Term Loan B								$		13,231
	4.00%, 04/02/2021 ^(g)			918		910
	Sabre GLBL Inc, Term Loan B						Pharmaceuticals - 0.12%
	4.00%, 02/15/2019 ^(g)			3,067		3,016	BioScrip Inc, Delay-Draw Term Loan B-DD
							6.50%, 07/22/2020 ^(g)		138		137
				$		16,535	BioScrip Inc, Term Loan B
	Leisure Time - 0.05%						6.50%, 06/05/2020 ^(g)		230		230
	Planet Fitness, Term Loan						P2 Lower Acquisition LLC, Term Loan
	4.75%, 03/26/2021 ^(g)			5,154		5,154	9.50%, 10/18/2021 ^(g)		4,825		4,729
							PharMEDium Healthcare Corp, Term Loan
							7.75%, 01/28/2022 ^(g)		7,042		7,024
	Lodging - 0.09%
	Caesars Entertainment Operating Co Inc, Term								$		12,120
	Loan B4B						Pipelines - 0.03%
	10.50%, 10/31/2016 ^(g)			813		739	Crestwood Holdings LLC, Term Loan B1
	Intrawest Operations Group LLC, Term Loan						7.00%, 05/24/2019 ^(g)		2,619		2,610
	B
	5.50%, 11/26/2020 ^(g)			8,312		8,304
				$		9,043	Retail - 0.17%
							1011778 BC ULC, Term Loan B
	Machinery - Diversified - 0.05%						4.50%, 09/25/2021 ^(g)		3,900		3,896
	CPM Holdings Inc, Term Loan						GOBP Holdings Inc, Term Loan
	10.25%, 02/16/2018 ^(g)			2,500		2,525	0.00%, 10/15/2021 ^(g),(i)		2,700		2,693
	Pro Mach Group Inc, Term Loan B						HMK Intermediate Holdings LLC, Term Loan
	0.00%, 10/15/2021 ^(g),(i)			2,500		2,496	B
				$		5,021	5.00%, 03/22/2018 ^(g)		3,785		3,709
							Mattress Holding Corp, Term Loan B
	Media- 0.03	%					5.25%, 10/01/2021 ^(g)		3,500		3,498
	CKX Inc, Term Loan B						Pilot Travel Centers LLC, Term Loan B
	9.00%, 06/21/2017 ^(b),(g)			1,503		1,277
							4.25%, 09/30/2021 ^(g)		2,000		2,000
	Cumulus Media Holdings Inc, Term Loan B						Targus Group International Inc, Term Loan B
	4.25%, 12/18/2020 ^(g)			1,910		1,888
							12.00%, 05/24/2016 ^(b),(g)		1,303		1,023
				$		3,165			$		16,819

	Metal Fabrication & Hardware - 0.11%						Software - 0.30%
	Doncasters Group Ltd, Term Loan						Attachmate Corp, Term Loan
	9.50%, 10/28/2020 ^(g)			441		439
							7.25%, 11/24/2017 ^(g)		3,664		3,660
	Doncasters US Finance LLC, Term Loan B						Deltek Inc, Term Loan
	4.50%, 04/05/2020 ^(g)			499		494
							10.00%, 10/04/2019 ^(g)		1,000		1,008


				Schedule of Investments
		Global Diversified Income Fund
				October 31, 2014


SENIOR FLOATING RATE INTERESTS	Principal
(continued)	Amount (000's) Value (000's)

Software (continued)
Evergreen Skills Lux Sarl, Term Loan
4.00%, 04/08/2021 ^(g)	$	2,363	$	2,317
First Data Corp, Term Loan C1
3.65%, 03/23/2018 ^(g)		1,700		1,683
Magic Newco LLC, Term Loan
12.00%, 12/06/2019 ^(g)		10,000		10,900
Micro Focus US Inc, Term Loan B
0.00%, 10/07/2021 ^(g),(i)		1,750		1,686
P2 Upstream Acquisition Co, Term Loan
9.00%, 04/30/2021 ^(g)		3,100		3,069
STG-Fairway Acquisitions Inc, Term Loan B
6.25%, 02/13/2019 ^(g)		1,231		1,223
Wall Street Systems Delaware Inc, Term Loan
B
4.50%, 04/09/2021 ^(g)		4,580		4,548
		$		30,094

Telecommunications - 0.25%
Aircell Business Aviation Services LLC, Term
Loan B1
11.25%, 06/21/2017 ^(b),(g)		4,408		4,629
Aircell Business Aviation Services LLC, Term
Loan B2
7.50%, 03/21/2018 ^(g)		1,415		1,401
Avaya Inc, Term Loan B3
4.65%, 10/26/2017 ^(g)		5,652		5,465
Avaya Inc, Term Loan B6
6.50%, 03/31/2018 ^(g)		3,692		3,659
LTS Buyer LLC, Term Loan
8.00%, 03/28/2021 ^(g)		417		414
Tower Development Corp, Term Loan
6.25%, 02/01/2017 ^(c),(g)		8,660		8,595
		$		24,163

Transportation - 0.12%
CEVA Group PLC, SYNTH LOC
6.50%, 03/19/2021 ^(g)		691		655
CEVA Group PLC, Term Loan
6.50%, 03/12/2021 ^(g)		1,000		948
6.50%, 03/19/2021 ^(g)		725		687
6.50%, 03/19/2021 ^(g)		125		119
Commercial Barge Line Co, Term Loan B
7.50%, 09/20/2019 ^(g)		2,431		2,427
SIRVA Worldwide Inc, Term Loan
7.50%, 03/22/2019 ^(g)		6,994		7,063
		$		11,899
TOTAL SENIOR FLOATING RATE INTERESTS		$		553,528
Total Investments		$		9,916,144
Other Assets in Excess of Liabilities, Net - 0.31%		$		31,090
TOTAL NET ASSETS - 100.00%		$		9,947,234


Schedule of Investments
Global Diversified Income Fund
October 31, 2014


Portfolio Summary (unaudited)			Other Assets in Excess of Liabilities, Net	0.31	%
Country	Percent		TOTAL NET ASSETS	100.00	%
United States	62.46	%
Canada	3.16	%
United Kingdom	3.07	%
Netherlands	2.04	%
France	2.01	%
Australia	1.89	%
Japan	1.78	%
Luxembourg	1.53	%
Venezuela	1.50	%
Russian Federation	1.41	%
Indonesia	1.14	%
Germany	1.04	%
Turkey	1.01	%
Argentina	0.82	%
Hong Kong	0.82	%
South Africa	0.72	%
Brazil	0.72	%
Italy	0.67	%
Chile	0.64	%
Dominican Republic	0.63	%
Mexico	0.59	%
Kazakhstan	0.58	%
Spain	0.55	%
Cayman Islands	0.54	%
Bermuda	0.50	%
Colombia	0.49	%
Virgin Islands, British	0.45	%
Switzerland	0.43	%
Singapore	0.41	%
Ireland	0.39	%
Costa Rica	0.38	%
Ukraine	0.38	%
Sweden	0.36	%
Panama	0.30	%
El Salvador	0.28	%
Croatia	0.25	%
Cote d'Ivoire	0.24	%
Azerbaijan	0.22	%
Iraq	0.21	%
Hungary	0.19	%
Norway	0.19	%
China	0.18	%
Marshall Islands	0.18	%
Poland	0.18	%
Jamaica	0.17	%
Serbia	0.17	%
Jersey, Channel Islands	0.17	%
Finland	0.14	%
Slovenia	0.14	%
Nigeria	0.13	%
Peru	0.13	%
Honduras	0.12	%
Taiwan, Province Of China	0.09	%
Belgium	0.08	%
Thailand	0.08	%
Israel	0.08	%
Korea, Republic Of	0.08	%
Morocco	0.08	%
Gabon	0.07	%
Kenya	0.06	%
Barbados	0.05	%
Denmark	0.05	%
Malaysia	0.05	%
Austria	0.04	%
Ghana	0.04	%
New Zealand	0.03	%
Curacao	0.03	%
Romania	0.03	%
Paraguay	0.02	%
Slovakia	0.01	%
Lithuania	0.01	%
Sri Lanka	0.01	%
Investments Sold Short	0.00	%


Schedule of Investments
Global Diversified Income Fund
October 31, 2014


Foreign Currency Contracts

															Unrealized Appreciation/(Depreciation)
Counterparty		Delivery Date	Contracts to Accept					In Exchange For			Fair Value				Asset			Liability
Bank of New York Mellon		11/06/2014	GBP			125,000		$	209		$		200	$			—	$	(9	)
JP Morgan Chase		11/06/2014	EUR		2,535,089				3,230		3,177						—		(53	)
JP Morgan Chase		11/28/2014	EUR		72,841,535				92,276		91,285						—		(991	)
JP Morgan Chase		11/28/2014	GBP		27,014,786				43,385		43,203						—		(182	)
Total														$			—	$	(1,235	)
															Unrealized Appreciation/(Depreciation)
Counterparty		Delivery Date	Contracts to Deliver					In Exchange For			Fair Value				Asset			Liability
Bank of New York Mellon		11/06/2014	GBP		3,125,000			$	5,254	$	4,999			$			255	$	—
Bank of New York Mellon		11/18/2014	GBP		2,000,000				3,236		3,199						37		—
Bank of New York Mellon		11/26/2014	EUR		5,025,000				6,595		6,297						298		—
Bank of New York Mellon		11/26/2014	GBP		2,850,000				4,557		4,558						—		(1	)
Bank of New York Mellon		01/07/2015	GBP		2,300,000				3,725		3,677						48		—
Bank of New York Mellon		01/23/2015	GBP		1,000,000				1,603		1,599						4		—
JP Morgan Chase		11/06/2014	EUR		253,234,463				323,527		317,341						6,187		(1	)
JP Morgan Chase		11/28/2014	EUR		45,026,744				56,384		56,428						83		(127	)
JP Morgan Chase		11/28/2014	GBP		61,266,158				99,628		97,978						1,650		—
JP Morgan Chase		11/28/2014	JPY		425,357,000				3,878		3,788						90		—
Total														$			8,652	$	(129	)

Amounts in thousands except contracts


Options

									Upfront Premiums									Unrealized
Written Options Outstanding	Exercise Price		Expiration Date			Contracts			Paid/(Received)					Fair Value			Appreciation/(Depreciation)
Call - DIA	$	161.00	11/24/2014					17,887	$		(2,304	)	$		(12,181	)	$	(9,877		)
Call - EEM	$	30.00	11/24/2014					18,709			(1,002	)			(1,386	)			(384	)
Call - EFA	$	62.00	11/24/2014					42,879			(2,520	)			(9,736	)		(7,216		)
Call - IYR	$	240.00	11/24/2014					3,220			(187	)			(738	)			(551	)
Call - SPY	$	178.00	11/24/2014					43,155			(8,021	)			(39,796	)		(31,775		)
Call - XLU	$	44.00	11/24/2014					5,342			(213	)			(930	)			(717	)
Total									$		(14,247	)	$		(64,767	)	$	(50,520		)

Amounts in thousands except contracts



Short Sales Outstanding



COMMON STOCKS - 0.00%		Shares	Value (000				's)

Publicly Traded Investment Fund - 0.00%
SPDR S&P 500 ETF Trust			100	$	20

TOTAL COMMON STOCKS (proceeds $19)			$		20
TOTAL SHORT SALES (proceeds $19)			$		20


Schedule of Investments
Global Real Estate Securities Fund
October 31, 2014



COMMON STOCKS - 99.42%	Shares Held		Value (000's)	COMMON STOCKS (continued)		Shares Held	Value(000		's)

Healthcare - Services - 0.78%				REITS (continued)
Brookdale Senior Living Inc ^(a)	544,034	$	18,339	Kenedix Residential Investment Corp		4,587		$ 12,019
				Keppel REIT		7,077,000		6,726
				Kilroy Realty Corp		479,850		32,505
Holding Companies - Diversified - 1.30%				Klepierre		717,869		31,071
Wharf Holdings Ltd/The	4,091,880		30,264	Land Securities Group PLC		3,041,998		53,977
				Link REIT/The		2,232,500		13,128
Home Builders - 1.10%				Mirvac Group		13,119,198		20,814
Iida Group Holdings Co Ltd	1,121,000		12,457	Nippon Building Fund Inc		1,448		8,116
Taylor Wimpey PLC	6,956,007		13,213	Nomura Real Estate Master Fund Inc		11,758		14,215
	$		25,670	Pebblebrook Hotel Trust		781,031		33,272
				Prologis Inc		1,535,615		63,958
Leisure Products & Services - 0.45%				Public Storage		184,246		33,964
Ardent Leisure Group	3,843,320		10,528	Saul Centers Inc		217,332		11,942
				Scentre Group ^(a)		6,677,803		21,302
Lodging - 0.17%				Simon Property Group Inc		824,567		147,771
Accor SA	93,743		3,938	SL Green Realty Corp		464,862		53,785
				Spring Real Estate Investment Trust		19,142,000		8,877
				Strategic Hotels & Resorts Inc ^(a)		1,445,734		18,578
Real Estate - 21.76%				Sun Communities Inc		200,200		11,606
CapitaLand Ltd	7,385,000		18,233	Sunstone Hotel Investors Inc		1,519,143		23,258
China Resources Land Ltd	4,776,000		11,360	Taubman Centers Inc		272,402		20,716
Deutsche Annington Immobilien SE	1,005,198		29,097	Unibail-Rodamco SE		107,975		27,686
Fabege AB	1,663,259		21,351	Ventas Inc		864,053		59,196
Hongkong Land Holdings Ltd	4,154,753		28,975	Vornado Realty Trust		418,140		45,778
Hufvudstaden AB	949,186		12,316	Washington Prime Group Inc		411,878		7,261
Jones Lang LaSalle Inc	111,218		15,038	Weingarten Realty Investors		650,810		23,592
Kerry Properties Ltd	3,689,000		12,655	Wereldhave NV		254,979		20,904
LEG Immobilien AG	220,050		15,209	Westfield Corp		5,297,842		37,228
Mitsubishi Estate Co Ltd	3,395,077		86,489	Workspace Group PLC		1,811,450		19,070
Mitsui Fudosan Co Ltd	2,551,793		82,082				$	1,715,977
New World Development Co Ltd	18,329,000		23,040
Nomura Real Estate Holdings Inc	933,000		16,490	Storage & Warehousing - 0.38%
Shimao Property Holdings Ltd	4,989,000		10,737	Safestore Holdings PLC		2,688,160		8,954
Sponda OYJ	2,994,986		13,713
ST Modwen Properties PLC	1,846,798		10,704	TOTAL COMMON STOCKS			$	2,321,815
Sumitomo Realty & Development Co Ltd	596,000		22,343	INVESTMENT COMPANIES - 0.63%		Shares Held		Value(000	's)
Sun Hung Kai Properties Ltd	3,730,687		55,666
Sun Hung Kai Properties Ltd - Warrants ^(a),(b)	283,890		616	Publicly Traded Investment Fund - 0.63%
UNITE Group PLC/The	3,222,167		22,031	Morgan Stanley Institutional Liquidity Funds -		14,627,603		14,628
	$		508,145	Government Portfolio

REITS - 73.48%				TOTAL INVESTMENT COMPANIES			$	14,628
AEON REIT Investment Corp	12,182		15,337	Total Investments			$	2,336,443
American Realty Capital Properties Inc	1,061,948		9,419	Liabilities in Excess of Other Assets, Net - (0.05)%			$	(1,225	)
Apartment Investment & Management Co	848,213		30,358	TOTAL NET ASSETS - 100.00%			$	2,335,218
Astro Japan Property Group ^(b)	1,886,407		7,322
AvalonBay Communities Inc	330,290		51,472
Boardwalk Real Estate Investment Trust	434,260		27,511	(a)	Non-Income Producing Security
Boston Properties Inc	362,335		45,926	(b)	Security is Illiquid
Camden Property Trust	365,866		28,051
Canadian Real Estate Investment Trust	492,855		21,642
CapitaCommercial Trust	11,159,000		14,510
CBL & Associates Properties Inc	345,758		6,614		Portfolio Summary (unaudited)
Corrections Corp of America	386,315		14,209	Country				Percent
CubeSmart	1,627,915		34,268	United States				54.37	%
Daiwa Office Investment Corp	2,511		13,507	Japan				12.83	%
DDR Corp	1,318,483		23,917	Hong Kong				8.37	%
Duke Realty Corp	1,415,915		26,846	United Kingdom				7.01	%
Education Realty Trust Inc	997,880		11,236	Australia				6.16	%
EPR Properties	354,877		19,909	France				2.69	%
Equity One Inc	767,913		18,430	Canada				2.11	%
Equity Residential	362,116		25,189	Germany				1.90	%
Essex Property Trust Inc	346,695		69,949	Singapore				1.69	%
Extra Space Storage Inc	571,022		33,211	Sweden				1.44	%
Federal Realty Investment Trust	208,592		27,492	Netherlands				0.89	%
Federation Centres	7,161,216		17,197	Finland				0.59	%
First Industrial Realty Trust Inc	1,311,314		25,610	Liabilities in Excess of Other Assets, Net				(0.05	)%
General Growth Properties Inc	1,648,307		42,708	TOTAL NET ASSETS				100.00	%
Goodman Group	6,077,785		29,673
Great Portland Estates PLC	3,252,154		35,793
HCP Inc	179,092		7,875
Health Care REIT Inc	420,396		29,894
Host Hotels & Resorts Inc	2,231,721		52,021
Kenedix Office Investment Corp	3,098		16,566


Schedule of Investments
Government & High Quality Bond Fund
October 31, 2014



	INVESTMENT COMPANIES - 1.07%		Shares Held Value (000's)					Principal
						BONDS (continued)		Amount (000's) Value (000's)
	Publicly Traded Investment Fund - 1.07%
	Goldman Sachs Financial Square Funds -		17,842,954	$	17,843	Mortgage Backed Securities (continued)
	Government Fund					Freddie Mac Strips
						3.00%, 10/15/2027 ^(a)	$	26,791	$	3,236
	TOTAL INVESTMENT COMPANIES		$		17,843	Ginnie Mae
			Principal			0.61%, 01/16/2054 ^(a)		50,534		2,746
	BONDS- 29.91%	Amount (000's) Value (000's)				0.66%, 04/16/2053 ^(a)		33,970		1,284
						0.67%, 11/16/2053 ^(a)		117,850		7,717
	Home Equity Asset Backed Securities - 0.86%					0.70%, 08/16/2051 ^(a)		102,252		6,213
	ACE Securities Corp Mortgage Loan Trust					0.71%, 04/16/2047 ^(a)		113,227		6,906
	Series 2007-D1					0.75%, 11/16/2045 ^(a)		46,595		2,842
	6.34%, 02/25/2038 ^(a),(b)	$	4,110	$	4,014	0.75%, 05/16/2053 ^(a)		66,949		4,494
	6.93%, 02/25/2038 ^(b)		10,512		10,344	0.75%, 10/16/2053 ^(a)		63,189		3,639
			$		14,358	0.79%, 06/16/2054 ^(a)		75,813		3,992
						0.80%, 12/16/2053 ^(a)		121,612		7,809
	Mortgage Backed Securities - 28.83%					0.86%, 02/16/2053 ^(a)		85,092		5,977
	Bear Stearns Commercial Mortgage Securities					0.87%, 02/16/2053 ^(a)		52,658		3,699
	Trust 2007-TOP28					0.91%, 03/16/2049 ^(a)		49,504		2,793
	5.96%, 09/11/2042 ^(a)		9,700		10,513
						0.92%, 03/16/2052 ^(a)		46,168		3,699
	BNPP Mortgage Securities LLC 2009-1					0.92%, 02/16/2053 ^(a)		97,891		7,786
	Trust					0.92%, 10/16/2054 ^(a)		63,336		3,656
	6.00%, 08/27/2037 ^(b)		6,757		7,150
						0.93%, 04/16/2056 ^(a)		44,959		3,469
	CFCRE Commercial Mortgage Trust 2011-					0.96%, 02/16/2046 ^(a)		68,466		4,736
	C1					0.96%, 11/16/2052 ^(a)		66,448		5,124
	5.54%, 04/15/2044 ^(a),(b)		3,000		3,356
						0.96%, 04/16/2053 ^(a)		37,072		2,670
	Citigroup Commercial Mortgage Trust 2013-					0.96%, 06/16/2054 ^(a)		33,890		2,155
	GC17					0.98%, 09/16/2053 ^(a)		63,414		4,554
	4.54%, 11/10/2046		10,363		11,222	0.99%, 02/16/2053 ^(a)		65,886		5,054
	Citigroup Mortgage Loan Trust 2009-5					0.99%, 04/16/2056 ^(a)		58,521		4,745
	6.95%, 10/25/2036 ^(b)		1,910		2,163
						1.05%, 06/16/2052 ^(a)		55,216		3,745
	Citigroup Mortgage Loan Trust 2010-8					1.13%, 08/16/2053 ^(a)		30,719		1,641
	5.75%, 02/25/2036 ^(b)		2,055		1,912
						1.22%, 09/16/2053 ^(a)		43,604		2,661
	Citigroup Mortgage Loan Trust 2010-9					1.22%, 10/16/2053 ^(a)		23,177		1,670
	4.25%, 01/25/2036 ^(b)		4,022		4,125
						1.28%, 12/16/2053 ^(a)		20,349		1,524
	Citigtoup Mortgage Loan Trust 2014-A					1.36%, 04/16/2053 ^(a)		32,619		2,041
	5.43%, 01/25/2035 ^(a),(b)		7,353		7,872
						1.42%, 08/16/2052 ^(a)		69,552		4,283
	Credit Suisse First Boston Mortgage Securities					1.58%, 12/16/2042 ^(a)		9,513		9,363
	Corp					2.24%, 03/16/2046 ^(a),(c)		8,642		8,513
	6.00%, 12/25/2033		3,074		3,326
	Fannie Mae Interest Strip					2.30%, 08/16/2041		8,887		9,165
						2.60%, 09/16/2042 ^(a),(c)		11,041		11,325
	7.00%, 04/25/2024 ^(a)		86		19
	Fannie Mae REMICS					3.00%, 05/16/2037		14,000		14,343
						3.00%, 01/16/2054 ^(a)		4,424		4,635
	0.75%, 04/25/2027 ^(a)		19		19
						3.50%, 04/20/2038 ^(a)		14,825		1,996
	2.00%, 12/25/2042		5,614		4,629
	2.50%, 02/25/2028 ^(a)		30,154		2,880	3.50%, 07/16/2045		6,850		7,089
						4.00%, 09/16/2026 ^(a)		14,509		1,862
	2.50%, 11/25/2041		9,013		9,132
	3.50%, 01/25/2028 ^(a)		28,858		4,058	4.00%, 02/20/2034		6,889		7,300
						4.00%, 04/20/2038 ^(a)		14,513		1,714
	3.50%, 02/25/2041 ^(a)		16,013		2,933
	3.50%, 02/25/2043		2,293		2,408	4.00%, 11/16/2038		1,532		1,614
						4.50%, 01/20/2038 ^(a)		6,256		585
	3.50%, 11/25/2042 ^(a)		35,377		6,264
	4.00%, 06/25/2039		10,000		10,566	5.00%, 11/20/2039		7,500		8,210
	4.00%, 11/25/2043		6,534		6,767	GS Mortgage Securities Trust 2011-GC5
						5.31%, 08/10/2044 ^(a),(b)		4,624		4,870
	6.50%, 02/25/2047		308		332
	7.00%, 04/25/2032		1,970		2,260	JP Morgan Chase Commercial Mortgage
	9.00%, 05/25/2020		22		24	Securities Trust 2006-LDP9
	Freddie Mac REMICS					5.37%, 05/15/2047		9,400		9,771
	1.05%, 02/15/2021 ^(a)		13		13	JP Morgan Chase Commercial Mortgage
	2.50%, 11/15/2032		8,574		8,455	Securities Trust 2013-C10
						3.37%, 12/15/2047 ^(a)		7,800		7,830
	2.50%, 01/15/2043 ^(a)		20,781		2,962
	2.50%, 02/15/2043		4,492		4,405	JP Morgan Chase Commercial Mortgage
	3.00%, 08/15/2028		5,010		5,072	Securities Trust 2013-C16
						4.94%, 12/15/2046 ^(a)		8,000		8,787
	3.00%, 11/15/2030 ^(a)		12,621		1,409
	3.00%, 02/15/2040		1,369		1,399	LF Rothschild Mortgage Trust III
	3.00%, 10/15/2042		3,275		3,360	9.95%, 09/01/2017		3		4
	3.00%, 03/15/2043		9,072		9,263	MASTR Alternative Loan Trust 2005-1
	3.50%, 01/15/2028 ^(a)		15,871		2,070	6.00%, 02/25/2035		5,345		5,888
	3.50%, 04/15/2040		19,386		2,537	Morgan Stanley Re-REMIC Trust 2010-R1
						2.53%, 07/26/2035 ^(a),(b)		9,700		9,137
	3.50%, 10/15/2042 ^(a)		11,597		2,464
						2.61%, 07/26/2035 ^(a),(b)		8,700		8,801
	4.00%, 06/15/2028 ^(a)		6,791		401
	4.00%, 01/15/2039 ^(a)		10,989		1,353	Sequoia Mortgage Trust 2013-12
						4.00%, 12/25/2043 ^(a),(b)		6,150		6,407
	4.00%, 05/15/2039		4,825		5,030
	4.00%, 11/15/2042 ^(a)		19,848		3,720	Springleaf Mortgage Loan Trust
						2.31%, 06/25/2058 ^(a),(b)		5,600		5,485
	4.50%, 12/15/2026		4,091		4,469
	4.50%, 05/15/2037 ^(a)		6,235		6,612	Springleaf Mortgage Loan Trust 2013-3
						3.79%, 09/25/2057 ^(a),(b)		4,800		4,834
	6.50%, 08/15/2027		138		155


Schedule of Investments
Government & High Quality Bond Fund
October 31, 2014



			Principal			U.S. GOVERNMENT & GOVERNMENT		Principal
BONDS (continued)			Amount (000's) Value (000's)			AGENCY OBLIGATIONS (continued)		Amount (000's) Value (000's)
						Federal Home Loan Mortgage Corporation (FHLMC)
Mortgage Backed Securities (continued)						(continued)
Structured Asset Sec Corp Mortgage Pass
Through Certs Series 2004-3						5.50%, 12/01/2037	$	3,849	$	4,318
5.68%, 03/25/2034 ^(a)		$	4,331	$	4,493	5.50%, 04/01/2038		31		35
WFRBS Commercial Mortgage Trust 2014-						5.50%, 05/01/2038		132		148
C23						6.00%, 04/01/2017		135		141
4.38%, 10/15/2057 ^(a)			9,700		10,139	6.00%, 04/01/2017		115		120
WFRBS Commercial Mortgage Trust 2014-						6.00%, 05/01/2017		140		146
LC14						6.00%, 07/01/2017		8		8
4.34%, 03/15/2047 ^(a)			8,000		8,019	6.00%, 01/01/2021		78		84
						6.00%, 06/01/2028		15		17
			$		479,818	6.00%, 05/01/2031		164		188
Other Asset Backed Securities - 0.22%						6.00%, 10/01/2031		6		7
TAL Advantage V LLC						6.00%, 02/01/2032		25		29
3.33%, 05/20/2039 ^(a),(b)			3,698		3,703	6.00%, 09/01/2032		326		368
						6.00%, 11/01/2033		783		895
TOTAL BONDS			$		497,879	6.00%, 11/01/2033		617		700
U.S. GOVERNMENT & GOVERNMENT			Principal			6.00%, 05/01/2034		1,908		2,133
AGENCY OBLIGATIONS - 69.36%			Amount (000's) Value (000's)			6.00%, 05/01/2034		2,509		2,864
Federal Home Loan Mortgage Corporation (FHLMC) -						6.00%, 09/01/2034		173		198
17.88	%					6.00%, 02/01/2035		160		183
2.04%, 03/01/2036 ^(a)		$	253	$	257	6.00%, 10/01/2036 ^(a)		123		140
2.50%, 08/01/2027			2,739		2,793	6.00%, 03/01/2037		220		249
2.50%, 09/01/2027			8,763		8,934	6.00%, 05/01/2037		302		344
						6.00%, 01/01/2038 ^(a)		111		126
2.50%, 02/01/2028			8,478		8,643
2.60%, 10/01/2032 ^(a)			2		2	6.00%, 03/01/2038		81		92
3.00%, 01/01/2027			7,781		8,081	6.00%, 04/01/2038		205		232
3.00%, 02/01/2027			8,312		8,633	6.00%, 07/01/2038		478		541
3.00%, 10/01/2042			11,658		11,697	6.00%, 10/01/2038		334		377
3.00%, 10/01/2042			4,697		4,712	6.00%, 09/01/2039		8,240		9,367
3.00%, 10/01/2042			9,436		9,509	6.50%, 11/01/2016		89		92
3.00%, 05/01/2043			8,513		8,567	6.50%, 06/01/2017		23		23
3.50%, 11/01/2026			5,505		5,829	6.50%, 12/01/2021		369		419
3.50%, 02/01/2032			8,721		9,148	6.50%, 04/01/2022		331		375
3.50%, 04/01/2032			7,399		7,761	6.50%, 05/01/2022		210		238
3.50%, 12/01/2041			4,431		4,597	6.50%, 08/01/2022		81		92
3.50%, 02/01/2042			3,212		3,323	6.50%, 05/01/2023		101		107
3.50%, 04/01/2042			12,879		13,326	6.50%, 07/01/2023		3		3
3.50%, 04/01/2042			1,306		1,351	6.50%, 01/01/2024		17		19
3.50%, 07/01/2042			13,900		14,383	6.50%, 07/01/2025		2		3
3.50%, 09/01/2042			9,847		10,181	6.50%, 07/01/2025		2		3
3.50%, 08/01/2043			9,399		9,746	6.50%, 09/01/2025		2		2
4.00%, 08/01/2026			4,953		5,283	6.50%, 09/01/2025		1		1
4.00%, 12/01/2040			8,851		9,446	6.50%, 10/01/2025		4		4
4.00%, 10/01/2041			6,533		6,961	6.50%, 10/01/2025		2		2
4.00%, 12/01/2041			7,887		8,467	6.50%, 04/01/2027		2		2
4.00%, 07/01/2042			5,279		5,669	6.50%, 03/01/2029		7		8
4.00%, 07/01/2043			6,810		7,310	6.50%, 03/01/2029		86		100
4.00%, 09/01/2044			7,988		8,575	6.50%, 04/01/2031		282		323
4.50%, 08/01/2033			827		897	6.50%, 06/01/2031		1		1
4.50%, 07/01/2039			2,910		3,177	6.50%, 10/01/2031		128		152
4.50%, 12/01/2040			7,330		7,944	6.50%, 01/01/2032		1,387		1,636
4.50%, 04/01/2041			8,457		9,337	6.50%, 02/01/2032		19		22
4.50%, 11/01/2043			8,272		9,134	6.50%, 04/01/2032		16		19
4.50%, 01/01/2044			9,064		9,975	6.50%, 04/01/2035		14		16
5.00%, 10/01/2025			148		163	6.50%, 02/01/2037		51		57
5.00%, 12/01/2032			121		134	7.00%, 07/01/2024		5		5
5.00%, 02/01/2033			1,292		1,431	7.00%, 01/01/2028		608		686
5.00%, 01/01/2034			1,151		1,276	7.00%, 06/01/2029		208		246
5.00%, 05/01/2034			244		271	7.00%, 01/01/2031		3		3
5.00%, 05/01/2035			266		295	7.00%, 04/01/2031		131		150
5.00%, 07/01/2035			122		135	7.00%, 10/01/2031		154		185
5.00%, 07/01/2035			7		8	7.00%, 04/01/2032		311		352
5.00%, 10/01/2035			22		24	7.50%, 12/01/2030		4		4
5.00%, 11/01/2035			974		1,080	7.50%, 02/01/2031		3		4
5.00%, 06/01/2039			4,871		5,400	7.50%, 02/01/2031		44		49
5.00%, 01/01/2040			6,733		7,462	8.00%, 08/01/2030		1		1
5.50%, 04/01/2018			69		73	8.00%, 12/01/2030		10		10
5.50%, 03/01/2029			1		2	8.50%, 04/01/2019		2		2
5.50%, 05/01/2033			21		24	8.50%, 07/01/2029		146		163
5.50%, 10/01/2033			30		33	9.00%, 09/01/2016		2		1
5.50%, 12/01/2033			746		838	9.00%, 09/01/2021		1		1
5.50%, 10/01/2035			5,086		5,698	9.00%, 01/01/2022		1		1
5.50%, 07/01/2037			60		67			$		297,694


Schedule of Investments
Government & High Quality Bond Fund
October 31, 2014



U.S. GOVERNMENT & GOVERNMENT		Principal			U.S. GOVERNMENT & GOVERNMENT		Principal
AGENCY OBLIGATIONS (continued)	Amount (000's) Value (000's)				AGENCY OBLIGATIONS (continued)	Amount (000's) Value (000's)

Federal National Mortgage Association (FNMA) - 34.01%					Federal National Mortgage Association (FNMA) (continued)
2.00%, 10/01/2027	$	5,909	$	5,858	5.00%, 05/01/2040	$	5,264	$	5,941
2.00%, 10/01/2027		4,317		4,279	5.00%, 05/01/2040		6,956		7,746
2.00%, 02/01/2028		7,518		7,453	5.00%, 06/01/2040		2,592		2,879
2.00%, 08/01/2028		4,465		4,427	5.00%, 07/01/2040		6,413		7,237
2.26%, 12/01/2033 ^(a)		160		170	5.00%, 07/01/2041		7,468		8,313
2.47%, 03/01/2028 ^(a)		16		16	5.00%, 07/01/2041		15,259		17,220
2.50%, 05/01/2027		8,458		8,631	5.50%, 09/01/2017		49		51
2.50%, 06/01/2027		10,012		10,217	5.50%, 09/01/2017		5		6
2.50%, 06/01/2027		13,469		13,744	5.50%, 12/01/2017		408		431
2.50%, 05/01/2028		5,100		5,198	5.50%, 03/01/2018		59		63
2.63%, 11/01/2033 ^(a)		11		11	5.50%, 06/01/2019		14		15
3.00%, 04/01/2027		7,444		7,744	5.50%, 06/01/2019		11		12
3.00%, 09/01/2034		4,642		4,727	5.50%, 07/01/2019		3		4
3.00%, 06/01/2042		8,666		8,691	5.50%, 07/01/2019		43		46
3.00%, 10/01/2042		8,859		8,915	5.50%, 07/01/2019		67		72
3.00%, 12/01/2042		9,081		9,132	5.50%, 07/01/2019		14		15
3.00%, 01/01/2043		9,154		9,206	5.50%, 08/01/2019		76		82
3.00%, 02/01/2043		9,558		9,627	5.50%, 08/01/2019		15		16
3.00%, 02/01/2043		8,607		8,642	5.50%, 09/01/2019		80		86
3.00%, 04/01/2043		11,139		11,178	5.50%, 06/01/2026		155		174
3.50%, 02/01/2042		10,059		10,472	5.50%, 05/01/2033		196		219
3.50%, 03/01/2042		5,321		5,516	5.50%, 07/01/2033		1,331		1,505
3.50%, 06/01/2042		5,601		5,807	5.50%, 09/01/2033		788		891
3.50%, 07/01/2042		8,441		8,769	5.50%, 02/01/2035		3,121		3,508
3.50%, 07/01/2042		6,287		6,517	5.50%, 02/01/2037		18		21
3.50%, 09/01/2042		14,263		14,817	5.50%, 12/01/2037		2,043		2,310
3.50%, 11/01/2042		8,781		9,121	5.50%, 03/01/2038		512		581
4.00%, 05/01/2025		4,131		4,425	5.50%, 03/01/2038		712		802
4.00%, 01/01/2034		2,761		2,957	5.50%, 06/01/2040		4,258		4,801
4.00%, 08/01/2039		7,091		7,537	6.00%, 12/01/2016		170		175
4.00%, 09/01/2040		5,394		5,761	6.00%, 01/01/2017		4		4
4.00%, 01/01/2041		7,749		8,241	6.00%, 04/01/2017		25		26
4.00%, 01/01/2041		8,879		9,443	6.00%, 08/01/2017		346		362
4.00%, 04/01/2041		5,361		5,699	6.00%, 08/01/2018		237		250
4.00%, 04/01/2041		6,351		6,752	6.00%, 12/01/2022		29		33
4.00%, 11/01/2041		8,044		8,550	6.00%, 03/01/2029		92		105
4.00%, 02/01/2042		4,034		4,326	6.00%, 08/01/2031		601		687
4.00%, 04/01/2042		9,517		10,116	6.00%, 12/01/2031		4		5
4.00%, 03/01/2043		7,525		8,037	6.00%, 12/01/2031		2		3
4.00%, 08/01/2043		7,463		8,017	6.00%, 01/01/2032		482		543
4.00%, 08/01/2043		12,604		13,540	6.00%, 11/01/2032		19		21
4.00%, 10/01/2043		9,410		10,088	6.00%, 04/01/2033		371		413
4.00%, 04/01/2044		4,762		5,116	6.00%, 02/01/2034		451		514
4.00%, 08/01/2044		15,808		16,982	6.00%, 03/01/2034		641		729
4.50%, 12/01/2019		79		83	6.00%, 09/01/2034		1,474		1,649
4.50%, 01/01/2020		302		320	6.00%, 11/01/2037		266		301
4.50%, 09/01/2025		4,643		5,031	6.00%, 02/01/2038		267		306
4.50%, 07/01/2039		6,280		6,880	6.00%, 03/01/2038		135		154
4.50%, 07/01/2039		2,911		3,187	6.00%, 08/01/2038		1,442		1,652
4.50%, 09/01/2039		3,699		4,052	6.00%, 04/01/2039		1,450		1,674
4.50%, 01/01/2041		14,620		16,149	6.50%, 06/01/2016		2		2
4.50%, 03/01/2041		6,616		7,227	6.50%, 09/01/2024		409		465
4.50%, 05/01/2041		8,820		9,597	6.50%, 08/01/2028		73		83
4.50%, 08/01/2041		5,404		5,976	6.50%, 11/01/2028		96		109
4.50%, 09/01/2043		6,348		7,012	6.50%, 12/01/2028		45		51
4.50%, 09/01/2043		11,709		12,935	6.50%, 02/01/2029		34		39
4.50%, 09/01/2043		7,280		8,043	6.50%, 03/01/2029		56		64
4.50%, 10/01/2043		3,431		3,772	6.50%, 04/01/2029		28		32
4.50%, 11/01/2043		10,356		11,440	6.50%, 06/01/2031		182		206
4.50%, 09/01/2044		8,988		9,929	6.50%, 06/01/2031		81		92
5.00%, 01/01/2018		49		52	6.50%, 06/01/2031		75		85
5.00%, 11/01/2018		290		307	6.50%, 09/01/2031		6		7
5.00%, 04/01/2019		71		75	6.50%, 12/01/2031		6		7
5.00%, 01/01/2026		179		198	6.50%, 01/01/2032		36		40
5.00%, 05/01/2033		10,271		11,546	6.50%, 04/01/2032		447		512
5.00%, 04/01/2035		305		341	6.50%, 04/01/2032		23		26
5.00%, 05/01/2035		200		222	6.50%, 08/01/2032		179		211
5.00%, 07/01/2035		69		76	6.50%, 11/01/2032		486		548
5.00%, 02/01/2038		3,520		3,948	6.50%, 11/01/2032		88		93
5.00%, 03/01/2038		2,759		3,111	6.50%, 11/01/2032		234		261
5.00%, 02/01/2040		13,767		15,535	6.50%, 02/01/2033		484		552
5.00%, 04/01/2040		1,544		1,711	6.50%, 07/01/2034		761		886


Schedule of Investments
Government & High Quality Bond Fund
October 31, 2014



U.S. GOVERNMENT & GOVERNMENT			Principal			U.S. GOVERNMENT & GOVERNMENT	Principal
AGENCY OBLIGATIONS (continued)		Amount (000's) Value (000's)				AGENCY OBLIGATIONS (continued)	Amount (000's) Value (000's)
						Government National Mortgage Association (GNMA)
Federal National Mortgage Association (FNMA) (continued)						(continued)
6.50%, 04/01/2036		$	14	$	16
6.50%, 08/01/2036			121		142	6.00%, 05/20/2024	$	30	$	33
						6.00%, 10/20/2024		13		15
6.50%, 08/01/2036			191		217	6.00%, 09/20/2025		25		28
6.50%, 10/01/2036			86		98
6.50%, 11/01/2036			87		101	6.00%, 04/20/2026		85		96
						6.00%, 10/20/2028		13		15
6.50%, 07/01/2037			57		69	6.00%, 02/20/2029		139		162
6.50%, 07/01/2037			40		45	6.00%, 05/20/2032 ^(a)		407		468
6.50%, 08/01/2037			100		115	6.00%, 08/15/2032		43		48
6.50%, 08/01/2037			1,057		1,215	6.00%, 09/15/2032		200		226
6.50%, 01/01/2038			14		16
6.50%, 02/01/2038			42		50	6.00%, 02/15/2033		29		34
						6.00%, 07/20/2033		1,668		1,921
6.50%, 05/01/2038			17		19	6.00%, 08/15/2038		402		454
7.00%, 05/01/2022			23		26
7.00%, 08/01/2028			109		126	6.50%, 09/15/2023		17		19
						6.50%, 09/15/2023		27		30
7.00%, 12/01/2028			107		126	6.50%, 09/15/2023		16		19
7.00%, 04/01/2029			30		31
7.00%, 07/01/2029			106		126	6.50%, 09/15/2023		14		16
						6.50%, 10/15/2023		27		31
7.00%, 11/01/2031			700		818	6.50%, 11/15/2023		5		6
7.00%, 07/01/2032			194		219
7.50%, 12/01/2024			147		162	6.50%, 12/15/2023		31		35
						6.50%, 12/15/2023		9		10
7.50%, 07/01/2029			32		33	6.50%, 12/15/2023		37		42
7.50%, 02/01/2030			94		105
7.50%, 01/01/2031			2		3	6.50%, 12/15/2023		18		20
						6.50%, 01/15/2024		24		27
7.50%, 08/01/2032			20		23	6.50%, 01/15/2024		4		4
8.00%, 05/01/2022			1		1
8.50%, 02/01/2023			2		2	6.50%, 01/15/2024		24		28
						6.50%, 01/15/2024		16		18
8.50%, 09/01/2025			2		2	6.50%, 01/15/2024		9		10
9.00%, 09/01/2030			44		53	6.50%, 01/15/2024		8		9
			$		566,210	6.50%, 01/15/2024		46		52
Government National Mortgage Association (GNMA) -						6.50%, 03/15/2024		43		49
10.65	%					6.50%, 04/15/2024		22		25
3.00%, 04/15/2027			8,163		8,539	6.50%, 04/20/2024		14		15
3.00%, 11/15/2042			10,998		11,265	6.50%, 07/15/2024		58		66
3.00%, 11/15/2042			8,178		8,346	6.50%, 01/15/2026		11		13
3.00%, 12/15/2042			8,808		8,989	6.50%, 03/15/2026		16		19
3.00%, 02/15/2043			8,935		9,152	6.50%, 07/20/2026		4		5
3.50%, 11/15/2041			5,249		5,492	6.50%, 10/20/2028		14		16
3.50%, 12/20/2041			7,511		7,870	6.50%, 03/20/2031		112		132
3.50%, 07/15/2042			9,758		10,207	6.50%, 04/20/2031		87		100
3.50%, 08/20/2042			8,493		8,947	6.50%, 07/15/2031		2		3
3.50%, 06/20/2043			8,785		9,283	6.50%, 10/15/2031		17		20
3.50%, 08/15/2043			11,282		11,864	6.50%, 07/15/2032		8		9
4.00%, 08/15/2041			7,712		8,365	6.50%, 05/20/2034		686		789
4.00%, 02/20/2043			4,513		4,833	6.80%, 04/20/2025		48		50
4.00%, 03/15/2044			7,244		7,869	7.00%, 11/15/2022		7		7
4.50%, 09/20/2039			6,827		7,472	7.00%, 11/15/2022		16		16
4.50%, 10/15/2039			5,675		6,261	7.00%, 12/15/2022		44		48
4.50%, 09/20/2041			7,113		7,783	7.00%, 12/15/2022		8		8
4.50%, 12/20/2041			5,885		6,441	7.00%, 01/15/2023		19		19
5.00%, 02/15/2034			277		309	7.00%, 01/15/2023		8		8
5.00%, 07/15/2039			1,904		2,109	7.00%, 01/15/2023		11		11
5.00%, 10/15/2039			5,511		6,141	7.00%, 02/15/2023		24		24
5.00%, 06/20/2041			4,624		5,140	7.00%, 07/15/2023		16		17
5.50%, 07/20/2033			2,261		2,568	7.00%, 07/15/2023		10		11
5.50%, 03/20/2034			2,258		2,566	7.00%, 07/15/2023		24		26
5.50%, 05/20/2035			256		291	7.00%, 08/15/2023		19		21
5.50%, 01/15/2039			357		403	7.00%, 10/15/2023		18		20
5.50%, 01/15/2039			689		774	7.00%, 12/15/2023		20		22
6.00%, 10/15/2023			170		191	7.00%, 12/15/2023		28		31
6.00%, 11/15/2023			52		59	7.00%, 01/15/2026		13		14
6.00%, 11/15/2023			23		25	7.00%, 01/15/2027		25		28
6.00%, 12/15/2023			42		47	7.00%, 10/15/2027		2		3
6.00%, 12/15/2023			26		30	7.00%, 10/15/2027		2		2
6.00%, 12/15/2023			2		3	7.00%, 10/15/2027		13		14
6.00%, 01/15/2024			16		18	7.00%, 11/15/2027		26		27
6.00%, 01/20/2024			7		8	7.00%, 12/15/2027		19		20
6.00%, 02/15/2024			35		39	7.00%, 12/15/2027		2		2
6.00%, 02/15/2024			29		33	7.00%, 02/15/2028		1		1
6.00%, 02/15/2024			19		21	7.00%, 04/15/2028		20		21
6.00%, 03/15/2024			18		20	7.00%, 04/15/2028		3		3
6.00%, 04/20/2024			40		45	7.00%, 06/15/2028		156		176
6.00%, 05/20/2024			21		24	7.00%, 12/15/2028		81		91


Schedule of Investments
Government & High Quality Bond Fund
October 31, 2014



U.S. GOVERNMENT & GOVERNMENT	Principal				U.S. GOVERNMENT & GOVERNMENT		Principal
AGENCY OBLIGATIONS (continued)	Amount (000's) Value (000's)				AGENCY OBLIGATIONS (continued)		Amount (000's) Value (000's)
Government National Mortgage Association (GNMA)
(continued)					U.S. Treasury (continued)
						4.25%, 11/15/2040	$	7,400	$	9,110
7.00%, 01/15/2029	$	58	$	65		6.25%, 08/15/2023		10,200		13,493
7.00%, 03/15/2029		44		46
7.00%, 04/15/2029		22		22				$		107,310
7.00%, 04/15/2029		193		218	U.S. Treasury Strip - 0.37%
7.00%, 05/15/2031		12		13		0.00%, 05/15/2020 ^(d),(e)		6,800		6,158
7.00%, 06/20/2031		81		97
7.00%, 07/15/2031		2		2	TOTAL U.S. GOVERNMENT & GOVERNMENT AGENCY
7.00%, 09/15/2031		3		3	OBLIGATIONS			$		1,154,674
7.25%, 09/15/2025		27		27	Total Investments			$		1,670,396
7.50%, 04/15/2017		7		7	Liabilities in Excess of Other Assets, Net - (0.34)%			$		(5,714	)
7.50%, 04/15/2017		2		2	TOTAL NET ASSETS - 100.00%			$		1,664,682
7.50%, 04/15/2017		7		7
7.50%, 07/15/2018		6		6
7.50%, 12/15/2021		25		25	(a)	Variable Rate. Rate shown is in effect at October 31, 2014.
7.50%, 02/15/2022		13		14	(b)	Security exempt from registration under Rule 144A of the Securities Act of
7.50%, 03/15/2022		10		10		1933. These securities may be resold in transactions exempt from
7.50%, 03/15/2022		2		2		registration, normally to qualified institutional buyers. Unless otherwise
7.50%, 04/15/2022		26		27		indicated, these securities are not considered illiquid. At the end of the
7.50%, 04/15/2022		7		7		period, the value of these securities totaled $84,173 or 5.06% of net assets.
7.50%, 04/15/2022		7		7	(c)	Fair value of these investments is determined in good faith by the Manager
7.50%, 05/15/2022		12		12		under procedures established and periodically reviewed by the Board of
7.50%, 07/15/2022		29		30		Directors. At the end of the period, the fair value of these securities totaled
7.50%, 08/15/2022		28		28		$19,838 or 1.19% of net assets.
7.50%, 08/15/2022		5		6	(d)	Non-Income Producing Security
7.50%, 08/15/2022		17		17	(e)	Security is a Principal Only Strip.
7.50%, 08/15/2022		2		2
7.50%, 02/15/2023		10		11
7.50%, 05/15/2023		24		24
7.50%, 05/15/2023		14		14		Portfolio Summary (unaudited)
7.50%, 05/15/2023		4		4	Sector					Percent
7.50%, 06/15/2023		16		18	Mortgage Securities					91.37	%
7.50%, 10/15/2023		4		4	Government					6.82	%
7.50%, 11/15/2023		13		13	Asset Backed Securities					1.08	%
7.50%, 03/15/2024		27		30	Exchange Traded Funds					1.07	%
7.50%, 08/15/2024		1		1	Liabilities in Excess of Other Assets, Net					(0.34	)%
7.50%, 05/15/2027		18		18	TOTAL NET ASSETS					100.00	%
7.50%, 05/15/2027		7		7
7.50%, 06/15/2027		11		11
7.50%, 08/15/2029		102		118
7.50%, 09/15/2029		21		21
7.50%, 09/15/2029		40		41
7.50%, 10/15/2029		68		78
7.50%, 11/15/2029		51		53
7.50%, 11/15/2029		84		89
8.00%, 08/15/2016		1		1
8.00%, 12/15/2016		2		2
8.00%, 04/15/2017		7		7
8.00%, 05/15/2017		2		2
8.00%, 06/15/2017		4		4
8.00%, 06/15/2017		1		1
8.00%, 02/15/2022		27		30
8.00%, 04/15/2022		18		20
8.00%, 12/15/2030		9		11
9.00%, 11/15/2021		67		75
9.50%, 04/15/2016		1		1
9.50%, 11/15/2016		1		1
9.50%, 07/15/2017		13		13
9.50%, 10/15/2017		5		5
9.50%, 11/15/2017		5		5
9.50%, 09/20/2018		35		36
9.50%, 09/15/2020		8		8
9.50%, 12/20/2020		18		18
9.50%, 01/20/2021		2		3
9.50%, 02/20/2021		1		1
9.50%, 03/20/2021		1		1
9.50%, 08/15/2021		68		80
		$		177,302

U.S. Treasury - 6.45%
1.75%, 10/31/2018		14,500		14,711
2.25%, 11/30/2017		5,900		6,122
3.13%, 05/15/2021		59,700		63,874


Schedule of Investments
High Yield Fund
October 31, 2014



	COMMON STOCKS - 0.00%			Shares Held	Value(000			's)			Principal
									BONDS (continued)		Amount (000's)		Value (000's)
	Biotechnology - 0.00%
	Neuro-Hitech Inc ^(a),(b)			250,000		$	—		Automobile Parts & Equipment - 0.66%
									Dana Holding Corp
									5.38%, 09/15/2021		$	8,085	$	8,409
	Commercial Services - 0.00%								6.00%, 09/15/2023			8,135		8,542
	Network Holding Co KSCC ^(a),(c)			393,257			—
									Gestamp Funding Luxembourg SA
									5.63%, 05/31/2020 ^(d)			5,481		5,481
	Computers - 0.00%								Rhino Bondco S.P.A
	SONICblue Inc ^(a),(c)			10,000,000			—		7.25%, 11/15/2020 ^(d)		EUR	2,000		2,518
												$		24,950

	Energy - Alternate Sources - 0.00%								Banks- 4.04	%
	Ogden Corp ^(a),(b),(c)			5,000,000			—		Barclays PLC
									8.25%, 12/29/2049 ^(e)		$	17,670		18,244
									CIT Group Inc

	Tower Semiconductors Semiconductor - 0.00% Ltd - Warrants ^(a),(b),(c)			225,800			—		3.88%, 02/19/2019			21,620		21,755
	Tower Semiconductor Ltd - Warrants ^(a),(b),(c)			3,821,912			—		Citigroup Inc
									5.80%, 11/15/2049 ^(e)			17,415		17,450
					$		—		ING Bank NV
	TOTAL COMMON STOCKS				$		—		5.80%, 09/25/2023 ^(d)			18,700		20,812
	INVESTMENT COMPANIES - 3.99%			Shares Held	Value(000			's)	JP Morgan Chase & Co
	Publicly Traded Investment Fund - 3.99%								5.00%, 12/29/2049 ^(e)			29,355		28,878
	JP Morgan US Government Money Market			150,101,498			150,101		Morgan Stanley
	Fund								5.45%, 07/29/2049 ^(e)			7,995		8,032
									RBS Capital Trust III
	TOTAL INVESTMENT COMPANIES				$		150,101		5.51%, 09/29/2049			15,195		14,891
	PREFERRED STOCKS - 0.79%			Shares Held	Value(000			's)	Wells Fargo & Co
									5.90%, 12/29/2049 ^(e)			21,415		22,017
	Diversified Financial Services - 0.79%											$		152,079
	Ally Financial Inc ^(d)			29,545			29,589
									Beverages - 0.76%
	TOTAL PREFERRED STOCKS				$		29,589		Constellation Brands Inc
				Principal					3.75%, 05/01/2021			13,575		13,592
									3.88%, 11/15/2019 ^(f)			2,105		2,136
	BONDS- 84.51	%		Amount (000's) Value (000				's)
									4.25%, 05/01/2023			12,780		12,844
	Advertising - 0.08%											$		28,572
	CBS Outdoor Americas Capital LLC / CBS
	Outdoor Americas Capital Corp								Building Materials - 0.97%
	5.25%, 02/15/2022 ^(d)		$	3,060		$	3,159		Boise Cascade Co
									6.38%, 11/01/2020			7,920		8,276
									Cemex SAB de CV
	Aerospace & Defense - 0.20%								7.25%, 01/15/2021 ^(d)			14,285		15,410
	Air 2 US								Grupo Isolux Corsan Finance BV
	8.63%, 10/01/2020 ^(c),(d)			7,013			7,399		6.63%, 04/15/2021 ^(d)		EUR	2,250		2,707
									Norbord Inc
									5.38%, 12/01/2020 ^(d)		$	10,175		9,997
	Agriculture - 0.63%
	Pinnacle Operating Corp											$		36,390
	9.00%, 11/15/2020 ^(d)			22,113			23,827
									Chemicals - 1.88%
									Axiall Corp
	Airlines - 0.41%								4.88%, 05/15/2023			7,847		7,612
	American Airlines 2013-2 Class A Pass								Cornerstone Chemical Co
	Through Trust								9.38%, 03/15/2018 ^(d)			9,815		9,790
	4.95%, 07/15/2024 ^(c)			6,608			7,054		Eagle Spinco Inc
	Northwest Airlines 1999-2 Class B Pass								4.63%, 02/15/2021			14,335		13,905
	Through Trust								INEOS Group Holdings SA
	7.95%, 09/01/2016 ^(c)			1,564			1,581		6.13%, 08/15/2018 ^(d)			3,700		3,732
	United Airlines 2014-1 Class B Pass Through								NOVA Chemicals Corp
	Trust								5.00%, 05/01/2025 ^(d)			8,760		9,045
	4.75%, 04/11/2022 ^(c)			3,500			3,487		5.25%, 08/01/2023 ^(d)			9,575		10,006
	US Airways 2001-1G Pass Through Trust								Taminco Global Chemical Corp
	7.08%, 09/20/2022 ^(c)			3,036			3,340		9.75%, 03/31/2020 ^(d)			15,095		16,604
					$		15,462					$		70,694

	Automobile Manufacturers - 1.74%								Computers - 1.25%
	Chrysler Group LLC / CG Co-Issuer Inc								Compiler Finance Sub Inc
	8.00%, 06/15/2019			9,715			10,407		7.00%, 05/01/2021 ^(d)			12,770		11,684
	Jaguar Land Rover Automotive PLC								IHS Inc
	4.13%, 12/15/2018 ^(d)			11,130			11,325		5.00%, 11/01/2022 ^(d)			3,065		3,111
	4.25%, 11/15/2019 ^(d)			6,335			6,367		NCR Corp
	5.63%, 02/01/2023 ^(d)			8,780			9,131		4.63%, 02/15/2021			24,423		24,301
	8.13%, 05/15/2021 ^(d)			5,440			5,984		5.88%, 12/15/2021			7,825		8,021
	Navistar International Corp											$		47,117
	8.25%, 11/01/2021			21,650			22,256
					$		65,470


Schedule of Investments
High Yield Fund
October 31, 2014



	Principal							Principal
BONDS (continued)	Amount (000's) Value (000's)				BONDS (continued)			Amount (000's) Value (000's)

Distribution & Wholesale - 0.43%					Food- 0.42	%
HD Supply Inc					Ingles Markets Inc
7.50%, 07/15/2020	$	15,120	$	16,103	5.75%, 06/15/2023		$	15,425	$	15,733


Diversified Financial Services - 3.08%					Forest Products & Paper - 1.77%
Aircastle Ltd					Resolute Forest Products Inc
4.63%, 12/15/2018		3,915		3,974	5.88%, 05/15/2023			15,665		14,999
5.13%, 03/15/2021		17,575		17,795	Sappi Papier Holding GmbH
7.63%, 04/15/2020		8,050		9,056	7.50%, 06/15/2032 ^(d)			17,625		16,479
Consolidated Energy Finance SA					7.75%, 07/15/2017 ^(d)			5,000		5,375
6.75%, 10/15/2019 ^(d)		7,753		7,908	8.38%, 06/15/2019 ^(d)			18,787		20,384
Credit Acceptance Corp					Tembec Industries Inc
6.13%, 02/15/2021 ^(d)		32,150		33,275	9.00%, 12/15/2019 ^(d)			9,430		9,548
Denali Borrower LLC / Denali Finance Corp								$		66,785
5.63%, 10/15/2020 ^(d)		19,740		20,937
DVI Inc					Healthcare - Products - 0.99%
0.00%, 02/01/2004 ^(a),(b),(c)		8,575		—	ConvaTec Finance International SA
					8.25%, PIK 9.00%, 01/15/2019 ^(d),(g)			23,165		23,660
0.00%, 02/01/2004 ^(a),(b),(c)		6,850		—
Fly Leasing Ltd					ConvaTec Healthcare E SA
					10.50%, 12/15/2018 ^(d)			300		318
6.38%, 10/15/2021		15,200		15,124
Icahn Enterprises LP / Icahn Enterprises					Kinetic Concepts Inc / KCI USA Inc
Finance Corp					10.50%, 11/01/2018			845		932
5.88%, 02/01/2022		7,500		7,706	Universal Hospital Services Inc
		$		115,775	7.63%, 08/15/2020			13,055		12,175
								$		37,085
Electric - 2.38%
Dynegy Finance I Inc / Dynegy Finance II					Healthcare - Services - 4.82%
Inc					Centene Corp
6.75%, 11/01/2019 ^(d)		5,500		5,692	4.75%, 05/15/2022			13,225		13,374
7.38%, 11/01/2022 ^(d)		15,610		16,508	5.75%, 06/01/2017			14,793		15,570
7.63%, 11/01/2024 ^(d)		2,625		2,783	Fresenius Medical Care US Finance II Inc
					4.75%, 10/15/2024 ^(d)			7,770		7,794
Elwood Energy LLC					5.88%, 01/31/2022 ^(d)			7,825		8,529
8.16%, 07/05/2026		7,635		8,513
Energy Future Intermediate Holding Co LLC /					Fresenius Medical Care US Finance Inc
					6.50%, 09/15/2018 ^(d)			4,895		5,421
EFIH Finance Inc
0.00%, 03/01/2022 ^(a),(d),(e)		8,762		10,427	HCA Holdings Inc
Indiantown Cogeneration LP					6.25%, 02/15/2021			2,480		2,669
9.77%, 12/15/2020		4,151		4,711	HCA Inc
Miran Mid-Atlantic Series C Pass Through					4.75%, 05/01/2023			21,400		21,748
Trust					5.00%, 03/15/2024			13,545		13,968
10.06%, 12/30/2028		18,968		20,675	5.25%, 04/15/2025			11,415		11,829
NRG Energy Inc					5.88%, 03/15/2022			12,015		13,187
6.25%, 05/01/2024 ^(d)		6,760		6,980	7.25%, 09/15/2020			12,480		13,229
8.25%, 09/01/2020		12,375		13,380	LifePoint Hospitals Inc
					5.50%, 12/01/2021 ^(d)			11,960		12,528
		$		89,669	MPH Acquisition Holdings LLC
Electronics - 0.58%					6.63%, 04/01/2022 ^(d)			15,920		16,656
Sanmina Corp					WellCare Health Plans Inc
4.38%, 06/01/2019 ^(d)		1,940		1,943	5.75%, 11/15/2020			24,175		24,895
Viasystems Inc								$		181,397
7.88%, 05/01/2019 ^(d)		18,685		19,806
		$		21,749	Holding Companies - Diversified - 0.79%
					Alphabet Holding Co Inc
Engineering & Construction - 0.32%					7.75%, 11/01/2017			9,020		8,750
Aguila 3 SA					Nielsen Co Luxembourg SARL/The
7.88%, 01/31/2018 ^(d)		8,070		8,090	5.50%, 10/01/2021 ^(d)			20,355		21,118
Astaldi SpA								$		29,868
7.13%, 12/01/2020 ^(d)	EUR	3,150		4,132
		$		12,222	Home Builders - 2.30%
					Beazer Homes USA Inc
Entertainment - 2.67%					6.63%, 04/15/2018			2,646		2,759
CCM Merger Inc					Lennar Corp
9.13%, 05/01/2019 ^(d)	$	21,383		22,987	4.13%, 12/01/2018			14,125		14,319
Cinemark USA Inc					4.75%, 11/15/2022 ^(e)			21,880		21,552
4.88%, 06/01/2023		29,030		28,595	MDC Holdings Inc
DreamWorks Animation SKG Inc					6.00%, 01/15/2043			10,555		9,130
6.88%, 08/15/2020 ^(d)		20,615		21,543	WCI Communities Inc
Peninsula Gaming LLC / Peninsula Gaming					6.88%, 08/15/2021			16,220		16,382
Corp					6.88%, 08/15/2021 ^(d)			3,635		3,671
8.38%, 02/15/2018 ^(d)		16,680		17,597	Woodside Homes Co LLC / Woodside Homes
WMG Holdings Corp					Finance Inc
13.75%, 10/01/2019		8,435		9,700	6.75%, 12/15/2021 ^(d)			18,625		18,718
		$		100,422				$		86,531


Schedule of Investments
High Yield Fund
October 31, 2014



			Principal						Principal
	BONDS (continued)		Amount (000's) Value (000's)				BONDS (continued)	Amount (000's) Value (000's)

	Insurance - 2.24%						Metal Fabrication & Hardware - 0.25%
	Liberty Mutual Group Inc						Wise Metals Intermediate Holdings LLC/Wise
	7.00%, 03/07/2067 ^(d),(e)		$	19,172	$	19,939	Holdings Finance Corp
	Voya Financial Inc						9.75%, PIK 10.50%, 06/15/2019 ^(d),(g)	$	8,560	$	9,288
	5.65%, 05/15/2053 ^(e)			54,280		54,280
	XL Group PLC
	6.50%, 12/31/2049 ^(e)			10,462		10,038	Mining - 1.35%
							FMG Resources August 2006 Pty Ltd
				$		84,257	6.88%, 02/01/2018 ^(d)		5,933		6,082
	Internet - 1.20%						6.88%, 04/01/2022 ^(d)		8,180		8,446
	Adria Bidco BV						8.25%, 11/01/2019 ^(d)		17,720		18,384
	7.88%, 11/15/2020 ^(d)		EUR	12,000		15,790	Midwest Vanadium Pty Ltd
	Zayo Group LLC / Zayo Capital Inc						0.00%, 02/15/2018 ^(a),(d)		11,225		1,571
	10.13%, 07/01/2020		$	26,594		29,519	St Barbara Ltd
				$		45,309	8.88%, 04/15/2018 ^(d)		15,120		12,096
							Taseko Mines Ltd
	Iron & Steel - 2.02%						7.75%, 04/15/2019		4,535		4,297
	ArcelorMittal								$		50,876
	7.50%, 10/15/2039			40,810		43,565
	Commercial Metals Co						Oil & Gas - 10.46%
	4.88%, 05/15/2023			22,670		22,103	Baytex Energy Corp
	Signode Industrial Group Lux SA/Signode						5.13%, 06/01/2021 ^(d)		7,195		7,015
	Industrial Group US Inc						Carrizo Oil & Gas Inc
	6.38%, 05/01/2022 ^(d)			10,625		10,306	7.50%, 09/15/2020		11,460		11,575
				$		75,974	8.63%, 10/15/2018		17,745		18,455
							Chaparral Energy Inc
	Lodging - 0.48%						7.63%, 11/15/2022		11,979		11,680
	MGM Resorts International						9.88%, 10/01/2020		7,360		7,765
	6.63%, 12/15/2021			6,290		6,888	Chesapeake Energy Corp
	7.75%, 03/15/2022			1,600		1,844	4.88%, 04/15/2022		14,585		14,917
	10.00%, 11/01/2016			8,205		9,292	6.13%, 02/15/2021		5,525		6,133
				$		18,024	Denbury Resources Inc
	Machinery - Construction & Mining - 0.22%						5.50%, 05/01/2022		21,285		20,966
	Vander Intermediate Holding II Corp						EP Energy LLC / Everest Acquisition Finance
	9.75%, PIK 10.50%, 02/01/2019 ^(d),(g)			7,930		8,406	Inc
							9.38%, 05/01/2020		18,325		20,020
							Halcon Resources Corp
	Media- 6.98	%					8.88%, 05/15/2021		7,085		5,810
	Cablevision Systems Corp						9.25%, 02/15/2022		6,000		4,875
	8.00%, 04/15/2020			13,880		15,893	9.75%, 07/15/2020		5,935		4,952
	CSC Holdings LLC						Kodiak Oil & Gas Corp
	6.75%, 11/15/2021			4,685		5,212	5.50%, 01/15/2021		16,200		16,443
	Cumulus Media Holdings Inc						5.50%, 02/01/2022		5,315		5,421
	7.75%, 05/01/2019			8,417		8,627	8.13%, 12/01/2019		12,060		12,964
	DISH DBS Corp						Linn Energy LLC / Linn Energy Finance
	5.88%, 07/15/2022			22,230		23,564	Corp
	6.75%, 06/01/2021			39,050		43,345	6.25%, 11/01/2019 ^(e)		9,585		8,818
	7.88%, 09/01/2019			28,160		32,701	6.50%, 05/15/2019		11,710		10,949
	Network Communications Inc						6.50%, 09/15/2021		17,245		15,779
	8.60%, PIK 8.60%, 01/14/2020 ^(c),(d),(g)			3,185		64	Northern Blizzard Resources Inc
	Norcell Sweden Holding 2 AB						7.25%, 02/01/2022 ^(d)		13,414		12,743
	10.75%, 09/29/2019 ^(d)		EUR	910		1,270	Oasis Petroleum Inc
	Numericable Group SA						6.50%, 11/01/2021		3,655		3,746
	6.00%, 05/15/2022 ^(d)		$	18,145		18,553	6.88%, 03/15/2022		5,645		5,871
	RCN Telecom Services LLC / RCN Capital						6.88%, 01/15/2023		11,425		11,882
	Corp						Ocean Rig UDW Inc
	8.50%, 08/15/2020 ^(d)			16,475		17,258	7.25%, 04/01/2019 ^(d)		24,430		20,888
	TVN Finance Corp III AB						Pacific Drilling SA
	7.38%, 12/15/2020 ^(d)		EUR	2,750		3,774	5.38%, 06/01/2020 ^(d)		7,706		6,892
	Unitymedia Hessen GmbH & Co KG /						PDC Energy Inc
	Unitymedia NRW GmbH						7.75%, 10/15/2022		24,945		26,198
	5.50%, 01/15/2023 ^(d)		$	16,650		17,358	QEP Resources Inc
	Unitymedia KabelBW GmbH						5.25%, 05/01/2023		13,091		12,731
	6.13%, 01/15/2025 ^(d)			7,640		7,974	RKI Exploration & Production LLC / RKI
	Univision Communications Inc						Finance Corp
	6.75%, 09/15/2022 ^(d)			4,516		5,013	8.50%, 08/01/2021 ^(d)		19,702		19,259
	6.88%, 05/15/2019 ^(d)			6,735		7,080	Seadrill Ltd
	8.50%, 05/15/2021 ^(d)			14,896		16,125	6.13%, 09/15/2017 ^(d)		27,540		26,796
	WideOpenWest Finance LLC /						Seventy Seven Energy Inc
	WideOpenWest Capital Corp						6.50%, 07/15/2022 ^(d)		17,560		16,506
	13.38%, 10/15/2019			31,030		35,374	Triangle USA Petroleum Corp
	10.25%, 07/15/2019			3,180		3,490	6.75%, 07/15/2022 ^(d)		12,355		10,811
				$		262,675


Schedule of Investments
High Yield Fund
October 31, 2014



	Principal							Principal
BONDS (continued)	Amount (000's) Value (000's)				BONDS (continued)			Amount (000's) Value (000's)

Oil & Gas (continued)					Real Estate - 0.47%
Ultra Petroleum Corp					Crescent Resources LLC / Crescent Ventures
6.13%, 10/01/2024 ^(d)	$	15,395	$	14,567	Inc
		$		393,427	10.25%, 08/15/2017 ^(d)		$	16,155	$	17,690

Oil & Gas Services - 1.53%
CGG SA					REITS- 0.71	%
5.88%, 05/15/2020 ^(d)	EUR	2,500		2,647	DuPont Fabros Technology LP
6.88%, 01/15/2022 ^(d)	$	5,255		4,204	5.88%, 09/15/2021			8,065		8,388
Exterran Partners LP / EXLP Finance Corp					iStar Financial Inc
6.00%, 10/01/2022 ^(d)		7,955		7,637	3.88%, 07/01/2016			1,630		1,650
FTS International Inc					4.88%, 07/01/2018			7,230		7,212
6.25%, 05/01/2022 ^(d)		17,435		16,476	9.00%, 06/01/2017			8,295		9,311
Key Energy Services Inc								$		26,561
6.75%, 03/01/2021		18,136		16,141
PHI Inc					Retail - 3.25%
					Building Materials Holding Corp
5.25%, 03/15/2019		10,570		10,442	9.00%, 09/15/2018 ^(d)			7,575		8,162
		$		57,547	Claire's Stores Inc
Packaging & Containers - 3.19%					7.75%, 06/01/2020 ^(d)			2,460		1,722
Ardagh Finance Holdings SA					9.00%, 03/15/2019 ^(d)			3,120		3,182
8.63%, PIK 8.63%, 06/15/2019 ^(d),(g)		6,760		6,912	Landry's Holdings II Inc
Ardagh Packaging Finance PLC / Ardagh					10.25%, 01/01/2018 ^(d)			18,155		18,881
Holdings USA Inc					Landry's Inc
3.23%, 12/15/2019 ^(d),(e)		14,000		13,685	9.38%, 05/01/2020 ^(d)			10,805		11,548
6.00%, 06/30/2021 ^(d)		4,280		4,221	Michaels FinCo Holdings LLC / Michaels
7.00%, 11/15/2020 ^(d)		1,039		1,059	FinCo Inc
Berry Plastics Corp					7.50%, PIK 8.25%, 08/01/2018 ^(d),(g)			7,188		7,296
5.50%, 05/15/2022		15,005		15,061	Michaels Stores Inc
Beverage Packaging Holdings Luxembourg II					5.88%, 12/15/2020 ^(d)			15,293		15,484
SA / Beverage Packaging Holdings II					Neiman Marcus Group LTD LLC
5.63%, 12/15/2016 ^(d)		4,845		4,857	8.75%, 10/15/2021 ^(d)			11,355		12,150
6.00%, 06/15/2017 ^(d)		2,755		2,748	New Academy Finance Co LLC / New
Coveris Holdings SA					Academy Finance Corp
7.88%, 11/01/2019 ^(d)		5,040		5,292	8.00%, PIK 8.75%, 06/15/2018 ^(d),(g)			21,990		22,127
Crown Cork & Seal Co Inc					Petco Holdings Inc
7.38%, 12/15/2026		18,749		20,718	8.50%, PIK 9.25%, 10/15/2017 ^(d),(g)			9,525		9,573
Exopack Holding Corp					Suburban Propane Partners LP/Suburban
10.00%, 06/01/2018 ^(d)		9,875		10,616	Energy Finance Corp
Reynolds Group Issuer Inc / Reynolds Group					7.38%, 03/15/2020			11,525		12,015
Issuer LLC / Reynolds Group Issuer								$		122,140
(Luxembourg) S.A.
7.13%, 04/15/2019		8,525		8,855	Savings & Loans - 0.00%
					Washington Mutual Bank / Henderson NV
7.88%, 08/15/2019		2,950		3,160	0.00%, 06/15/2011 ^(a),(c)			3,500		—
9.00%, 04/15/2019		17,815		18,617	0.00%, 01/15/2013 ^(a)			3,000		—
9.88%, 08/15/2019		4,078		4,430	0.00%, 01/15/2015 ^(a),(e)			2,000		—
		$		120,231				$		—
Pharmaceuticals - 1.64%
Grifols Worldwide Operations Ltd					Software - 1.09%
5.25%, 04/01/2022 ^(d)		9,100		9,327	Activision Blizzard Inc
					5.63%, 09/15/2021 ^(d)			17,765		18,898
Par Pharmaceutical Cos Inc					6.13%, 09/15/2023 ^(d)			20,295		21,969
7.38%, 10/15/2020		12,350		13,122
Salix Pharmaceuticals Ltd								$		40,867
6.00%, 01/15/2021 ^(d)		17,585		19,036	Telecommunications - 10.04%
Valeant Pharmaceuticals International Inc					Altice Financing SA
6.75%, 08/15/2018 ^(d)		3,000		3,191	6.50%, 01/15/2022 ^(d)			5,830		5,990
7.50%, 07/15/2021 ^(d)		15,865		16,976	Altice Finco SA
		$		61,652	8.13%, 01/15/2024 ^(d)			1,200		1,263
					9.88%, 12/15/2020 ^(d)			9,217		10,277
Pipelines - 1.29%					Altice SA
Energy Transfer Equity LP					7.75%, 05/15/2022 ^(d)			19,895		20,890
5.88%, 01/15/2024		7,960		8,358	B Communications Ltd
Regency Energy Partners LP / Regency					7.38%, 02/15/2021 ^(d)			5,550		5,911
Energy Finance Corp					Digicel Group Ltd
5.00%, 10/01/2022		17,810		18,166	8.25%, 09/30/2020 ^(d)			5,485		5,732
Sabine Pass Liquefaction LLC
5.63%, 02/01/2021 ^(e)		10,410		10,904	Digicel Ltd
					6.00%, 04/15/2021 ^(d)			13,450		13,584
6.25%, 03/15/2022 ^(d)		8,915		9,606
					8.25%, 09/01/2017 ^(d)			7,360		7,535
Targa Resources Partners LP / Targa					Eileme 2 AB
Resources Partners Finance Corp					11.63%, 01/31/2020 ^(d)			11,125		12,738
4.13%, 11/15/2019 ^(d)		1,505		1,528
					Frontier Communications Corp
		$		48,562	6.25%, 09/15/2021			5,375		5,553


Schedule of Investments
High Yield Fund
October 31, 2014



	Principal						Principal
BONDS (continued)	Amount (000's) Value (000's)				CONVERTIBLE BONDS (continued)		Amount (000's) Value (000's)

Telecommunications (continued)					Food Service (continued)
Goodman Networks Inc					FU JI Food and Catering Services Holdings
12.13%, 07/01/2018	$	14,748	$	15,780	Ltd (continued)
Intelsat Jackson Holdings SA					0.00%, 10/18/2010 ^(a),(b),(c)		CNY	245,000	$	—
7.25%, 10/15/2020		24,500		26,154				$		—
Intelsat Luxembourg SA
6.75%, 06/01/2018		5,000		5,175	Semiconductors - 0.66%
7.75%, 06/01/2021		5,430		5,674	Jazz Technologies Inc
					8.00%, 12/31/2018 ^(d)		$	22,173		24,848
Level 3 Communications Inc
11.88%, 02/01/2019		11,823		12,739
Level 3 Escrow II Inc					TOTAL CONVERTIBLE BONDS			$		24,848
5.38%, 08/15/2022 ^(d)		7,935		8,074	SENIOR FLOATING RATE INTERESTS - Principal
Level 3 Financing Inc					7.29	%	Amount (000's) Value (000's)
6.13%, 01/15/2021 ^(d)		5,720		5,999
					Building Materials - 0.25%
Matterhorn Financing & CY SCA					GYP Holdings III Corp, Term Loan B
9.00%, 04/15/2019 ^(d)	EUR	6,850		8,670	7.75%, 03/25/2022 ^(e)		$	9,515	$	9,479
SoftBank Corp
4.50%, 04/15/2020 ^(d)	$	28,380		28,735
Sprint Capital Corp					Chemicals - 0.46%
6.88%, 11/15/2028		7,235		7,036	AZ Chem US Inc, Term Loan
Sprint Communications Inc					7.50%, 06/10/2022 ^(e)			12,993		12,966
6.00%, 11/15/2022		16,545		16,504	Emerald Performance Materials LLC, Term
7.00%, 08/15/2020		26,235		27,809	Loan
9.00%, 11/15/2018 ^(d)		12,425		14,615	7.75%, 07/22/2022 ^(e)			4,475		4,397
Sprint Corp								$		17,363
7.13%, 06/15/2024 ^(d)		10,240		10,522
7.88%, 09/15/2023 ^(d)		7,845		8,492	Consumer Products - 0.23%
					Dell International LLC, Term Loan B
T-Mobile USA Inc					4.50%, 03/24/2020 ^(e)			8,529		8,536
6.00%, 03/01/2023		7,810		8,044
6.13%, 01/15/2022		4,110		4,259
6.25%, 04/01/2021		18,595		19,409	Electric - 0.44%
6.50%, 01/15/2024		4,025		4,216	Texas Competitive Electric Holdings Co LLC,
6.63%, 04/28/2021		12,140		12,792	Term Loan NONEXT
Virgin Media Finance PLC					4.68%, 10/10/2014 ^(e)			22,873		16,540
6.00%, 10/15/2024 ^(d)		2,940		3,058
Wind Acquisition Finance SA					Electronics - 0.24%
4.75%, 07/15/2020 ^(d)		10,885		10,640
6.50%, 04/30/2020 ^(d)		300		312	Isola USA Corp, Term Loan B
					9.25%, 11/29/2018 ^(e)			9,121		9,098
7.38%, 04/23/2021 ^(d)		24,140		23,597
		$		377,778
					Entertainment - 0.71%
Transportation - 2.71%					CCM Merger Inc, Term Loan B
AG Spring Finance II Ltd					4.50%, 07/30/2021 ^(e)			16,020		15,920
9.50%, 06/01/2019 ^(d)	EUR	2,500		2,569
					Peninsula Gaming LLC, Term Loan B
Eletson Holdings					4.25%, 11/30/2017 ^(e)			11,022		10,974
9.63%, 01/15/2022 ^(d)	$	17,244		17,158
								$		26,894
Hornbeck Offshore Services Inc
5.00%, 03/01/2021		9,820		8,740	Forest Products & Paper - 0.59%
Navios Maritime Acquisition Corp / Navios					Caraustar Industries Inc, Term Loan B
Acquisition Finance US Inc					7.50%, 04/26/2019 ^(e)			11,837		11,878
8.13%, 11/15/2021 ^(d)		37,660		38,319	NewPage Corp, Term Loan B
Navios Maritime Holdings Inc / Navios					9.50%, 02/05/2021 ^(e)			10,510		10,184
Maritime Finance II US Inc								$		22,062
7.38%, 01/15/2022 ^(d)		16,245		16,326
Navios South American Logistics Inc / Navios					Healthcare - Products - 0.20%
					Accellent Inc, Term Loan
Logistics Finance US Inc					4.50%, 02/19/2021 ^(e)			7,736		7,649
7.25%, 05/01/2022 ^(d)		12,220		12,312
Topaz Marine SA
8.63%, 11/01/2018 ^(d)		6,540		6,654	Healthcare - Services - 0.50%
		$		102,078	MPH Acquisition Holdings LLC, Term Loan
					B
Trucking & Leasing - 0.22%					4.00%, 03/19/2021 ^(e)			10,335		10,165
Jurassic Holdings III Inc					Radnet Management Inc, Term Loan B

6.88%, 02/15/2021(d)		8,060		8,120	8.00%, 03/25/2021 ^(e)			8,770		8,683
								$		18,848
TOTAL BONDS		$		3,179,920
	Principal				Insurance - 0.53%
CONVERTIBLE BONDS - 0.66%	Amount (000's) Value (000's)				Asurion LLC, Term Loan
					8.50%, 02/19/2021 ^(e)			19,585		19,884
Food Service - 0.00%
FU JI Food and Catering Services Holdings
Ltd					Internet - 0.02%
0.00%, 11/09/2009 ^(a),(c)	HKD	46,500		—	Zayo Group LLC, Term Loan B
					4.00%, 07/02/2019 ^(e)			811		803


Schedule of Investments
High Yield Fund
October 31, 2014



	SENIOR FLOATING RATE INTERESTS			Principal				(f)	Security purchased on a when-issued basis.
	(continued)		Amount (000's)				Value (000's)	(g)	Payment in kind; the issuer has the option of paying additional securities
									in lieu of cash.
	Lodging - 0.88%
	Caesars Entertainment Operating Co Inc, Term
	Loan B6B
		6.99%, 01/28/2018 ^(e)		$	27,001	$	24,163		Portfolio Summary (unaudited)
	Caesars Entertainment Operating Co Inc, Term							Sector		Percent
	Loan B7							Communications		19.25	%
		9.75%, 03/01/2017 ^(e)			9,790		9,032	Consumer, Cyclical		13.74	%
					$		33,195	Energy		13.65	%
	Media- 0.56%							Financial		12.09	%
	Univision Communications Inc, Term Loan							Consumer, Non-cyclical		10.57	%
	C3							Industrial		9.15	%
		4.00%, 03/01/2020 ^(e)			3,260		3,224	Basic Materials		8.19	%
	Univision Communications Inc, Term Loan							Exchange Traded Funds		3.99	%
	C4							Technology		3.00	%
		4.00%, 03/01/2020 ^(e)			8,008		7,921	Utilities		2.82	%
	WideOpenWest Finance LLC, Term Loan B							Diversified		0.79	%
		4.75%, 03/27/2019 ^(e)			9,823		9,806	Other Assets in Excess of Liabilities, Net		2.76	%
					$		20,951	TOTAL NET ASSETS		100.00	%

	Mining - 0.12%
	FMG Resources August 2006 Pty Ltd, Term
	Loan B
		3.75%, 06/30/2019 ^(e)			4,646		4,528


	Oil & Gas - 0.37%
	Seadrill Operating LP, Term Loan B
		4.00%, 02/12/2021 ^(e)			9,937		9,376
	Seventy Seven Operating LLC, Term Loan B
		3.75%, 06/17/2021 ^(e)			4,534		4,418
					$		13,794

	Pharmaceuticals - 0.38%
	Par Pharmaceutical Cos Inc, Term Loan B1
		4.00%, 09/30/2019 ^(e)			14,540		14,310


	REITS- 0.23		%
	iStar Financial Inc, Term Loan A2
		7.00%, 03/19/2017 ^(e)			8,465		8,635


	Retail - 0.21%
	Michaels Stores Inc, Term Loan B
		4.00%, 01/20/2028 ^(e)			7,885		7,740


	Telecommunications - 0.37%
	Altice Financing SA, Delay-Draw Term Loan
	DD
		5.50%, 07/03/2019 ^(e)			5,037		5,062
	Integra Telecom Holdings Inc, Term Loan
		9.75%, 02/19/2020 ^(e)			2,510		2,466
	NTELOS Inc, Term Loan B
		5.75%, 11/09/2019 ^(e)			6,485		6,475
					$		14,003
	TOTAL SENIOR FLOATING RATE INTERESTS				$		274,312
	Total Investments				$		3,658,770
	Other Assets in Excess of Liabilities, Net - 2.76%				$		103,736
	TOTAL NET ASSETS - 100.00%				$		3,762,506


	(a)	Non-Income Producing Security
	(b)	Security is Illiquid
	(c)	Fair value of these investments is determined in good faith by the Manager
		under procedures established and periodically reviewed by the Board of
		Directors. At the end of the period, the fair value of these securities totaled
		$22,925 or 0.61% of net assets.
	(d)	Security exempt from registration under Rule 144A of the Securities Act of
		1933. These securities may be resold in transactions exempt from
		registration, normally to qualified institutional buyers. Unless otherwise
		indicated, these securities are not considered illiquid. At the end of the
		period, the value of these securities totaled $1,570,379 or 41.74% of net
		assets.
	(e)	Variable Rate. Rate shown is in effect at October 31, 2014.

Schedule of Investments

High Yield Fund

October 31, 2014

Exchange Cleared Credit Default Swaps

Sell Protection

Implied
Credit Spread
as of October
31, 2014(c)

(Pay)/

Receive Fixed

Expiration

Notional

Fair Value

Unrealized Appreciation/

Reference Entity

Rate

Date

Amount (a)

(b)

(Depreciation)

CDX.NA.HY.23

N/A

5.00

12/20/2019

25,000

1,747

198

CDX.NA.HY.23

N/A

5.00

12/20/2019

25,000

1,746

106

Total

3,493

304

Amounts in thousands

(a) The maximum potential payment amount that the seller of credit protection could be required to make if a credit event occurs as defined under the terms of that

particular swap agreement is $50,000.

(b) The market price and resulting market value for credit default swap agreements on credit indices serve as an indicator of the current status of the

payment/performance risk and represent the likelihood of an expected liability (or profit) for the credit default swap as of the period end. Increasing market values, in

absolute terms, when compared to the notional amount of the swap, represent a deterioration of the referenced entity's credit soundness and a greater likelihood or risk

of default or other credit event occurring as defined under the terms of the agreement.

(c) Implied credit spreads, represented in absolute terms, used in determining the market value of credit default swap agreements on corporate issues or sovereign

issues as of period end serve as an indicator of the current status of the payment/performance risk and represent the likelihood or risk of default for the credit

derivative. The implied credit spread of a particular referenced entity reflects the cost of buying/selling protection and may include upfront payments required to be

made to enter into the agreement. Wider credit spreads represent a deterioration of the referenced entity's credit soundness and a greater likelihood or risk of default

or other credit event occurring as defined under the terms of the agreement.

Foreign Currency Contracts

Unrealized Appreciation/(Depreciation)

Counterparty

Delivery Date

Contracts to Deliver

In Exchange For

Fair Value

Asset

Liability

Brown Brothers Harriman & Co

12/19/2014

EUR

40,000,000

51,844

50,134

1,710

—

Total

1,710

—

Amounts in thousands except contracts


Schedule of Investments
High Yield Fund I
October 31, 2014



	COMMON STOCKS - 0.15%			Shares Held	Value(000			's)			Principal
									BONDS (continued)		Amount (000's) Value (000's)
	Building Materials - 0.03%
	US Concrete Inc ^(a)			19,229		$	475		Aerospace & Defense - 0.29%
									Alliant Techsystems Inc
									5.25%, 10/01/2021 ^(d)	$	466	$	474
	Computers - 0.00%								B/E Aerospace Inc
	Stratus Technologies Bermuda Ltd / Stratus			12,366			—		5.25%, 04/01/2022		647		720
	Technologies Inc ^(a),(b),(c)								6.88%, 10/01/2020		464		502
									Kratos Defense & Security Solutions Inc
	Diversified Financial Services - 0.01%								7.00%, 05/15/2019		1,831		1,794
	Capmark Financial Group Inc ^(a),(c)			10,610,000			63		TransDigm Inc
	Somerset Cayuga Holding Co Inc ^(a),(b),(c)			6,862			185		6.00%, 07/15/2022		1,019		1,031
					$		248		6.50%, 07/15/2024		644		663
											$		5,184
	Electric - 0.03%
	Dynegy Inc ^(a)			20,000			610		Airlines - 0.52%
									Continental Airlines 2003-ERJ1 Pass Through
									Trust
	Forest Products & Paper - 0.07%								7.88%, 01/02/2020 ^(c)		1,370		1,464
	NewPage Group Inc ^(a),(b),(c)			14,145			1,273
									Continental Airlines 2004-ERJ1 Pass Through
									Trust
	Packaging & Containers - 0.00%								9.56%, 09/01/2019 ^(c)		325		362
	Constar International ^(a),(b),(c)			9,689			—		Continental Airlines 2005-ERJ1 Pass Through
									Trust
									9.80%, 04/01/2021 ^(c)		1,840		2,056
	Retail - 0.01%								Continental Airlines 2006-ERJ1 Pass Through
	Neebo Inc ^(a),(b)			20,064			105
	(a),(b),(c)								Trust
	Neebo Inc - Warrants			7,519			—		9.32%, 11/01/2019 ^(c),(d)		198		222
	Neebo Inc - Warrants ^(a),(b),(c)			3,508			—
									Continental Airlines 2012-3 Class C Pass Thru
					$		105		Certificates
	Transportation - 0.00%								6.13%, 04/29/2018 ^(c)		845		892
	General Maritime Corp ^(a),(b),(c)			974			11		Delta Air Lines 2007-1 Class B Pass Through
	General Maritime Corp - Warrants ^(a),(b),(c)			1,507			—		Trust
									8.02%, 08/10/2022 ^(c)		453		525
					$		11
	TOTAL COMMON STOCKS				$		2,722		Delta Air Lines 2012-1 Class B Pass Through
	INVESTMENT COMPANIES - 3.33%			Shares Held	Value(000			's)	Trust
									6.88%, 05/07/2019 ^(c),(d)		384		426
	Publicly Traded Investment Fund - 3.33%								Northwest Airlines 2007-1 Class A Pass
	Goldman Sachs Financial Square Funds -			59,644,025			59,644		Through Trust
	Money Market Fund								7.03%, 11/01/2019 ^(c)		1,801		2,053
									UAL 2007-1 Pass Through Trust
	TOTAL INVESTMENT COMPANIES				$		59,644		6.64%, 01/02/2024 ^(c)		492		527
	PREFERRED STOCKS - 0.33%			Shares Held	Value(000			's)	US Airways 2013-1 Class B Pass Through
									Trust
	Computers - 0.00%								5.38%, 11/15/2021 ^(c)		855		870
	Stratus Technologies Bermuda Ltd / Stratus			2,814			—				$		9,397
	Technologies Inc ^(a),(b),(c)
									Automobile Manufacturers - 1.29%
									Chrysler Group LLC / CG Co-Issuer Inc

	Diversified FinancialServices - 0.11%								8.00%, 06/15/2019		4,838		5,182
	Ally Financial Inc ^(d)			2,046			2,049		8.25%, 06/15/2021		10,484		11,716
									General Motors Co
	Insurance - 0.22%								0.00%, 11/15/2015 ^(a),(b),(c)		75		—
	Hartford Financial Services Group Inc/The			19,400			587		0.00%, 11/15/2015 ^(a),(b),(c)		100		—
	XLIT Ltd			3,935			3,281		0.00%, 12/01/2020 ^(a),(b),(c)		50		—
					$		3,868		0.00%, 12/01/2020 ^(a),(b),(c)		25		—
									0.00%, 07/15/2023 ^(a),(b),(c)		1,000		—
	Packaging & Containers - 0.00%								0.00%, 09/01/2025 ^(a),(b),(c)		700		—
	Constar International ^(a),(b),(c)			977			—
									0.00%, 05/01/2028 ^(a),(b),(c)		150		—
									0.00%, 07/15/2033 ^(a),(b),(c)		5,050		—
	TOTAL PREFERRED STOCKS				$		5,917		0.00%, 03/15/2036 ^(a),(b),(c)		725		—
				Principal					3.50%, 10/02/2018		910		937
	BONDS- 88.64	%	Amount (000's)				Value(000	's)	6.25%, 10/02/2043		805		958
	Advertising - 0.26%								Jaguar Land Rover Automotive PLC
	Alliance Data Systems Corp								4.13%, 12/15/2018 ^(d)		1,683		1,713
	5.38%, 08/01/2022 (d)			$900			$914		4.25%, 11/15/2019 ^(d)		816		820
									5.63%, 02/01/2023 ^(d)		300		312
	CBS Outdoor Americas Capital LLC / CBS
	Outdoor Americas Capital Corp								JB Poindexter & Co Inc
	5.25%, 02/15/2022 ^(d)			337			348		9.00%, 04/01/2022 ^(d)		1,299		1,416
	5.63%, 02/15/2024 ^(d)			1,250			1,303				$		23,054
	5.88%, 03/15/2025 ^(d)			400			420
									Automobile Parts & Equipment - 0.32%
	Sitel LLC / Sitel Finance Corp								Goodyear Tire & Rubber Co/The
	11.50%, 04/01/2018			1,242			1,090		6.50%, 03/01/2021		800		856
	11.00%, 08/01/2017 ^(d)			545			561
									7.00%, 05/15/2022		3,170		3,447
							$4,636


Schedule of Investments
High Yield Fund I
October 31, 2014



				Principal					Principal
	BONDS (continued)			Amount (000's) Value (000's)			BONDS (continued)		Amount (000's) Value (000's)

	Automobile Parts & Equipment (continued)						Building Materials (continued)
	MPG Holdco I Inc						Headwaters Inc
	7.38%, 10/15/2022 ^(d)		$	514	$	540	7.25%, 01/15/2019	$	482	$	494
	Pittsburgh Glass Works LLC						Lafarge SA
	8.00%, 11/15/2018 ^(d)			894		939	7.13%, 07/15/2036		550		644
				$		5,782	Masco Corp
							5.95%, 03/15/2022		370		407
	Banks- 2.61	%					7.13%, 03/15/2020		48		55
	Bank of America Corp						Masonite International Corp
	5.13%, 12/29/2049 ^(e)			1,325		1,285
							8.25%, 04/15/2021 ^(d)		1,460		1,562
	8.00%, 12/29/2049 ^(e)			1,908		2,054
	8.13%, 12/29/2049 ^(e)			1,015		1,101	Norbord Inc
							5.38%, 12/01/2020 ^(d)		665		653
	Barclays Bank PLC						Unifrax I LLC / Unifrax Holding Co
	7.63%, 11/21/2022			1,330		1,449	7.50%, 02/15/2019 ^(d)		500		508
	Barclays PLC						7.50%, 02/15/2019 ^(d)		400		406
	8.25%, 12/29/2049 ^(e)			435		449
							US Concrete Inc
	CIT Group Inc						8.50%, 12/01/2018 ^(d)		795		855
	3.88%, 02/19/2019			4,695		4,724	USG Corp
	5.00%, 05/15/2017			672		704	8.38%, 10/15/2018 ^(d)		1,625		1,700
	5.00%, 08/15/2022			2,778		2,907	9.75%, 01/15/2018 ^(e)		5,700		6,569
	5.25%, 03/15/2018			2,135		2,252	Vulcan Materials Co
	5.38%, 05/15/2020			4,372		4,672	7.50%, 06/15/2021		1,480		1,724
	5.50%, 02/15/2019 ^(d)			2,170		2,315
	6.63%, 04/01/2018 ^(d)			5,060		5,540			$		28,581
	Citigroup Inc						Chemicals - 1.87%
	5.95%, 12/29/2049			871		866	Ashland Inc
	Credit Agricole SA						3.00%, 03/15/2016		688		695
	6.63%, 09/29/2049 ^(d),(e)			987		963	3.88%, 04/15/2018		846		860
	Goldman Sachs Group Inc/The						4.75%, 08/15/2022 ^(e)		1,737		1,750
	5.70%, 12/29/2049 ^(e)			868		888	Axalta Coating Systems US Holdings Inc /
	Royal Bank of Scotland Group PLC						Axalta Coating Systems Dutch Holding B
	6.00%, 12/19/2023			1,555		1,674	7.38%, 05/01/2021 ^(d)		1,495		1,618
	6.10%, 06/10/2023			1,427		1,543	Axiall Corp
	6.13%, 12/15/2022			3,656		3,958	4.88%, 05/15/2023		1,007		977
	Royal Bank of Scotland PLC/The						Basell Finance Co BV
	9.50%, 03/16/2022 ^(e)			1,465		1,674	8.10%, 03/15/2027 ^(d)		825		1,106
	Sophia Holding Finance LP / Sophia Holding						Celanese US Holdings LLC
	Finance Inc						4.63%, 11/15/2022		905		912
	9.63%, PIK 9.63%, 12/01/2018 ^(d),(f)			2,180		2,218	Eagle Spinco Inc
	Wachovia Capital Trust III						4.63%, 02/15/2021		1,023		992
	5.57%, 03/29/2049 ^(e)			434		420	Huntsman International LLC
	Wells Fargo & Co						4.88%, 11/15/2020		3,535		3,562
	5.90%, 12/29/2049 ^(e)			1,512		1,555	5.13%, 11/15/2022 ^(d),(g)		382		384
	7.98%, 12/31/2049 ^(e)			1,500		1,653	8.63%, 03/15/2020		860		923
				$		46,864	8.63%, 03/15/2021		3,310		3,608
							LyondellBasell Industries NV
	Beverages - 0.30%						5.00%, 04/15/2019		400		441
	Constellation Brands Inc						6.00%, 11/15/2021		750		878
	3.75%, 05/01/2021			229		229	Momentive Performance - Escrow
	3.88%, 11/15/2019 ^(g)			500		508
							0.00%, 10/15/2020 ^(a),(b),(c)		800		—
	4.25%, 05/01/2023			1,961		1,971	Momentive Performance Materials Inc
	4.75%, 11/15/2024 ^(g)			1,100		1,124
							3.88%, 10/24/2021		800		692
	6.00%, 05/01/2022			295		330	NOVA Chemicals Corp
	Crestview DS Merger Sub II Inc						5.00%, 05/01/2025 ^(d)		1,223		1,263
	10.00%, 09/01/2021			1,156		1,277	Nufarm Australia Ltd
				$		5,439	6.38%, 10/15/2019 ^(d)		725		729
	Building Materials - 1.59%						Olin Corp
	Building Materials Corp of America						5.50%, 08/15/2022		900		929
	5.38%, 11/15/2024 ^(d),(g)			1,000		1,002	PolyOne Corp
	6.75%, 05/01/2021 ^(d)			1,625		1,743	5.25%, 03/15/2023		1,889		1,894
	CEMEX Espana SA/Luxembourg						7.38%, 09/15/2020		1,257		1,332
	9.88%, 04/30/2019 ^(d)			2,455		2,738	PQ Corp
	Cemex Finance LLC						8.75%, 05/01/2018 ^(d)		5,010		5,311
	6.00%, 04/01/2024 ^(d)			581		592	Rain CII Carbon LLC / CII Carbon Corp
	9.38%, 10/12/2022 ^(d)			220		254	8.00%, 12/01/2018 ^(d)		830		855
	Cemex SAB de CV						8.25%, 01/15/2021 ^(d)		710		724
	5.70%, 01/11/2025 ^(d)			2,655		2,601	Rayonier AM Products Inc
	6.50%, 12/10/2019 ^(d)			125		134	5.50%, 06/01/2024 ^(d)		359		339
	7.25%, 01/15/2021 ^(d)			2,213		2,387	WR Grace & Co-Conn
	Griffon Corp						5.13%, 10/01/2021 ^(d)		576		600
	5.25%, 03/01/2022			466		449	5.63%, 10/01/2024 ^(d)		192		202
	Hardwoods Acquisition Inc								$		33,576
	7.50%, 08/01/2021 ^(d)			1,093		1,104


Schedule of Investments
High Yield Fund I
October 31, 2014



				Principal					Principal
	BONDS (continued)			Amount (000's) Value (000's)			BONDS (continued)		Amount (000's) Value (000's)

	Coal- 0.96	%					Commercial Services (continued)
	Alpha Natural Resources Inc						Mustang Merger Corp
	6.00%, 06/01/2019		$	5,771	$	2,885	8.50%, 08/15/2021 ^(d)	$	383	$	387
	6.25%, 06/01/2021			5,955		2,829	Quad/Graphics Inc
	9.75%, 04/15/2018			680		444	7.00%, 05/01/2022 ^(d)		700		672
	Cloud Peak Energy Resources LLC / Cloud						RR Donnelley & Sons Co
	Peak Energy Finance Corp						6.00%, 04/01/2024		1,875		1,875
	6.38%, 03/15/2024			835		818	6.50%, 11/15/2023		1,370		1,418
	Consol Energy Inc						7.00%, 02/15/2022		2,470		2,643
	5.88%, 04/15/2022 ^(d)			6,395		6,491	7.25%, 05/15/2018		1,783		1,997
	6.38%, 03/01/2021			800		828	7.63%, 06/15/2020		2,525		2,815
	8.25%, 04/01/2020			390		411	7.88%, 03/15/2021		3,365		3,786
	Peabody Energy Corp						8.25%, 03/15/2019		2,275		2,668
	6.25%, 11/15/2021			1,826		1,729	Service Corp International/US
	Westmoreland Coal Co / Westmoreland						5.38%, 05/15/2024		2,335		2,405
	Partners						8.00%, 11/15/2021		440		517
	10.75%, 02/01/2018			800		838	ServiceMaster Co/The
				$		17,273	7.00%, 08/15/2020		2,927		3,095
							8.00%, 02/15/2020		4,908		5,239
	Commercial Services - 4.13%						Speedy Cash Intermediate Holdings Corp
	ACE Cash Express Inc						10.75%, 05/15/2018 ^(d)		475		469
	11.00%, 02/01/2019 ^(d)			1,551		1,109
							United Rentals North America Inc
	ADT Corp/The						5.75%, 11/15/2024		170		178
	3.50%, 07/15/2022			289		259	6.13%, 06/15/2023		4,959		5,337
	4.13%, 04/15/2019			325		322	7.38%, 05/15/2020		1,345		1,459
	4.13%, 06/15/2023			2,590		2,383	8.25%, 02/01/2021		3,015		3,286
	6.25%, 10/15/2021			1,390		1,460	8.38%, 09/15/2020		875		947
	Anna Merger Sub Inc								$		73,976
	7.75%, 10/01/2022 ^(d)			2,075		2,114
	APX Group Inc						Computers - 0.52%
	6.38%, 12/01/2019			890		874	iGATE Corp
	8.75%, 12/01/2020			5,135		4,442	4.75%, 04/15/2019		760		758
	8.75%, 12/01/2020 ^(d)			695		601	IHS Inc
	Ashtead Capital Inc						5.00%, 11/01/2022 ^(d)		1,310		1,330
	6.50%, 07/15/2022 ^(d)			775		837	Seagate HDD Cayman
	Avis Budget Car Rental LLC / Avis Budget						3.75%, 11/15/2018 ^(d)		775		798
	Finance Inc						4.75%, 06/01/2023		608		627
	4.88%, 11/15/2017			362		373	SunGard Data Systems Inc
	5.13%, 06/01/2022 ^(d)			1,045		1,033	6.63%, 11/01/2019		953		987
	9.75%, 03/15/2020			472		520	7.38%, 11/15/2018		444		463
	Cardtronics Inc						7.63%, 11/15/2020		4,082		4,352
	5.13%, 08/01/2022 ^(d)			1,050		1,045			$		9,315
	Cenveo Corp
	6.00%, 08/01/2019 ^(d)			970		934	Consumer Products - 0.11%
	8.50%, 09/15/2022 ^(d)			820		754	Spectrum Brands Inc
	Ceridian LLC						6.63%, 11/15/2022		825		885
	8.88%, 07/15/2019 ^(d)			1,859		2,054	6.75%, 03/15/2020		1,025		1,084
	Ceridian LLC / Comdata Inc								$		1,969
	8.13%, 11/15/2017 ^(d)			1,805		1,805	Cosmetics & Personal Care - 0.05%
	Deluxe Corp						Revlon Consumer Products Corp
	7.00%, 03/15/2019			476		500	5.75%, 02/15/2021 ^(e)		825		825
	FTI Consulting Inc
	6.75%, 10/01/2020			750		791
	Garda World Security Corp						Distribution & Wholesale - 0.27%
	7.25%, 11/15/2021 ^(d)			1,580		1,572	Global Partners LP / GLP Finance Corp
							6.25%, 07/15/2022 ^(d)		315		312
	Harland Clarke Holdings Corp
	6.88%, 03/01/2020 ^(d)			260		267	H&E Equipment Services Inc
	9.25%, 03/01/2021 ^(d)			445		451	7.00%, 09/01/2022		1,219		1,301
	9.75%, 08/01/2018 ^(d)			900		965	HD Supply Inc
	Hertz Corp/The						7.50%, 07/15/2020		1,033		1,100
	5.88%, 10/15/2020			1,075		1,083	8.13%, 04/15/2019		790		853
	6.25%, 10/15/2022			570		581	VWR Funding Inc
	6.75%, 04/15/2019			337		351	7.25%, 09/15/2017		1,155		1,213
	7.38%, 01/15/2021			525		555			$		4,779
	Jaguar Holding Co II / Jaguar Merger Sub Inc						Diversified Financial Services - 5.74%
	9.50%, 12/01/2019 ^(d)			1,125		1,207
							AerCap Ireland Capital Ltd / AerCap Global
	Lender Processing Services Inc / Black Knight						Aviation Trust
	Lending Solutions Inc						3.75%, 05/15/2019 ^(d)		3,620		3,593
	5.75%, 04/15/2023			675		716	4.50%, 05/15/2021 ^(d)		3,470		3,505
	Live Nation Entertainment Inc						Aircastle Ltd
	5.38%, 06/15/2022 ^(d)			320		321
	7.00%, 09/01/2020 ^(d)			474		504	4.63%, 12/15/2018		3,475		3,527
							6.25%, 12/01/2019		1,117		1,190


Schedule of Investments
High Yield Fund I
October 31, 2014



		Principal					Principal
BONDS (continued)		Amount (000's) Value (000's)			BONDS (continued)		Amount (000's) Value (000's)

Diversified Financial Services (continued)					Electric (continued)
Ally Financial Inc					Dynegy Roseton LLC / Dynegy Danskammer
2.75%, 01/30/2017	$	3,570	$	3,574	LLC Pass Through Trust Series B
4.75%, 09/10/2018		70		73	0.00%, 11/08/2016 ^(a),(b),(c)	$	2,773	$	—
5.13%, 09/30/2024		665		692	GenOn Energy Inc
5.50%, 02/15/2017		1,403		1,492	7.88%, 06/15/2017		1,500		1,519
6.25%, 12/01/2017		4,657		5,077	9.88%, 10/15/2020		2,210		2,293
7.50%, 09/15/2020		1,729		2,058	InterGen NV
8.00%, 03/15/2020		8,424		10,130	7.00%, 06/30/2023 ^(d)		643		616
8.00%, 11/01/2031		1,761		2,241	IPALCO Enterprises Inc
CNG Holdings Inc/OH					5.00%, 05/01/2018		1,150		1,219
9.38%, 05/15/2020 ^(d)		1,555		1,170	NRG Energy Inc
Denali Borrower LLC / Denali Finance Corp					6.25%, 07/15/2022		3,590		3,752
5.63%, 10/15/2020 ^(d)		2,654		2,815	6.25%, 05/01/2024 ^(d)		1,000		1,032
E*TRADE Financial Corp					6.63%, 03/15/2023		1,143		1,206
6.38%, 11/15/2019		1,240		1,322	7.63%, 01/15/2018		4,390		4,928
General Motors Financial Co Inc					7.88%, 05/15/2021		8,029		8,711
3.25%, 05/15/2018		874		893	8.25%, 09/01/2020		4,910		5,309
4.38%, 09/25/2021		2,480		2,598	RJS Power Holdings LLC
Icahn Enterprises LP / Icahn Enterprises					5.13%, 07/15/2019 ^(d)		2,966		2,951
Finance Corp					Texas Competitive Electric Holdings Co LLC
3.50%, 03/15/2017		5,090		5,065	/ TCEH Finance Inc
4.88%, 03/15/2019		2,380		2,421	0.00%, 10/01/2020 ^(a),(d),(e)		1,075		863
5.88%, 02/01/2022		1,764		1,813			$		48,773
ILFC E-Capital Trust I
4.84%, 12/21/2065 ^(d),(e)		4,533		4,295	Electrical Components & Equipment - 0.08%
ILFC E-Capital Trust II					Belden Inc
					5.25%, 07/15/2024 ^(d)		300		295
6.25%, 12/21/2065 ^(d),(e)		577		558
International Lease Finance Corp					International Wire Group Holdings Inc
					8.50%, 10/15/2017 ^(d)		1,093		1,162
3.88%, 04/15/2018		1,030		1,033
4.63%, 04/15/2021		2,672		2,705			$		1,457
6.25%, 05/15/2019		4,020		4,397	Electronics - 0.20%
8.25%, 12/15/2020		3,677		4,412	Flextronics International Ltd
8.63%, 01/15/2022		3,809		4,723	5.00%, 02/15/2023		1,635		1,668
8.75%, 03/15/2017 ^(e)		2,225		2,503	Sanmina Corp
8.88%, 09/01/2017		3,095		3,559	4.38%, 06/01/2019 ^(d)		603		604
Nationstar Mortgage LLC / Nationstar Capital					Viasystems Inc
Corp					7.88%, 05/01/2019 ^(d)		1,251		1,326
6.50%, 07/01/2021		232		216			$		3,598
7.88%, 10/01/2020		327		322
9.63%, 05/01/2019		386		420	Engineering & Construction - 0.44%
Navient Corp					AECOM Technology Corp
4.88%, 06/17/2019		7,655		7,770	5.75%, 10/15/2022 ^(d)		1,144		1,204
5.50%, 01/15/2019		2,375		2,463	5.88%, 10/15/2024 ^(d)		1,630		1,724
6.13%, 03/25/2024		2,530		2,612	Dycom Investments Inc
Neuberger Berman Group LLC/Neuberger					7.13%, 01/15/2021		750		788
Berman Finance Corp					MasTec Inc
5.63%, 03/15/2020 ^(d)		740		773	4.88%, 03/15/2023		1,200		1,146
5.88%, 03/15/2022 ^(d)		500		530	SBA Communications Corp
Walter Investment Management Corp					4.88%, 07/15/2022 ^(d)		970		955
7.88%, 12/15/2021 ^(d)		4,620		4,343	Tutor Perini Corp
		$		102,883	7.63%, 11/01/2018		2,035		2,106
							$		7,923
Electric - 2.72%
AES Corp/VA					Entertainment - 2.58%
5.50%, 03/15/2024		2,123		2,171	AMC Entertainment Inc
Calpine Corp					5.88%, 02/15/2022		1,385		1,413
0.00%, 07/15/2013 ^(a),(b),(c)		1,500		—	Cedar Fair LP / Canada's Wonderland Co /
5.38%, 01/15/2023		712		719	Magnum Management Corp
5.75%, 01/15/2025		708		717	5.25%, 03/15/2021		1,800		1,809
5.88%, 01/15/2024 ^(d)		1,688		1,815	5.38%, 06/01/2024 ^(d)		375		375
6.00%, 01/15/2022 ^(d)		1,460		1,573	Chukchansi Economic Development
7.88%, 01/15/2023 ^(d)		1,534		1,699	Authority
Dynegy Finance I Inc / Dynegy Finance II					10.25%, 05/30/2020 ^(d)		1,268		717
Inc					DreamWorks Animation SKG Inc
6.75%, 11/01/2019 ^(d)		3,180		3,291	6.88%, 08/15/2020 ^(d)		770		805
7.38%, 11/01/2022 ^(d)		1,195		1,264	GLP Capital LP / GLP Financing II Inc
7.63%, 11/01/2024 ^(d)		390		413	4.38%, 11/01/2018		1,340		1,377
Dynegy Holdings Inc					4.88%, 11/01/2020		5,240		5,450
0.00%, 06/01/2015 ^(a),(b),(c)		100		—	5.38%, 11/01/2023		1,210		1,274
0.00%, 06/01/2019 ^(a),(b),(c)		3,158		—	Graton Economic Development Authority
0.00%, 10/15/2026 ^(a),(b),(c)		92		—	9.63%, 09/01/2019 ^(d)		4,310		4,827
Dynegy Inc					Isle of Capri Casinos Inc
5.88%, 06/01/2023		727		712	5.88%, 03/15/2021		2,180		2,234


Schedule of Investments
High Yield Fund I
October 31, 2014



			Principal						Principal
	BONDS (continued)	Amount (000's)		Value (000's)		BONDS (continued)			Amount (000's) Value (000's)

	Entertainment (continued)					Forest Products & Paper (continued)
	Isle of Capri Casinos Inc	(continued)				Clearwater Paper Corp
	8.88%, 06/15/2020	$	2,790	$	2,985	4.50%, 02/01/2023		$	370	$	361
	Mohegan Tribal Gaming Authority					5.38%, 02/01/2025 ^(d)			750		759
	9.75%, 09/01/2021		6,275		6,463				$		1,471
	11.00%, 09/15/2018 ^(d)		1,370		1,356
	Peninsula Gaming LLC / Peninsula Gaming					Gas- 0.08	%
	Corp					AmeriGas Partners LP/AmeriGas Finance
	8.38%, 02/15/2018 ^(d)		2,755		2,907	Corp
	Pinnacle Entertainment Inc					6.25%, 08/20/2019			500		522
	6.38%, 08/01/2021		1,825		1,953	NGL Energy Partners LP / NGL Energy
	7.50%, 04/15/2021		1,810		1,932	Finance Corp
						5.13%, 07/15/2019 ^(d)			281		283
	7.75%, 04/01/2022		1,885		2,059	6.88%, 10/15/2021 ^(d)			516		548
	Regal Entertainment Group
	5.75%, 03/15/2022		275		269				$		1,353
	5.75%, 06/15/2023		825		792	Hand & Machine Tools - 0.06%
	5.75%, 02/01/2025		430		406	Milacron LLC / Mcron Finance Corp
	Scientific Games International Inc					7.75%, 02/15/2021 ^(d)			1,040		1,082
	6.63%, 05/15/2021 ^(d)		560		445
	Seneca Gaming Corp
	8.25%, 12/01/2018 ^(d)		805		841	Healthcare - Products - 0.92%
	Shingle Springs Tribal Gaming Authority					Alere Inc
	9.75%, 09/01/2021 ^(d)		715		795	6.50%, 06/15/2020			608		626
	WMG Acquisition Corp					7.25%, 07/01/2018			500		533
	5.63%, 04/15/2022 ^(d)		1,000		1,005	Biomet Inc
	6.75%, 04/15/2022 ^(d)		1,805		1,778	6.50%, 08/01/2020			2,135		2,284
			$		46,267	6.50%, 10/01/2020			1,365		1,443
						ConvaTec Finance International SA
	Environmental Control - 0.09%					8.25%, PIK 9.00%, 01/15/2019 ^(d),(f)			511		522
	Casella Waste Systems Inc					ConvaTec Healthcare E SA
	7.75%, 02/15/2019		1,195		1,219	10.50%, 12/15/2018 ^(d)			2,255		2,390
	Covanta Holding Corp					DJO Finance LLC / DJO Finance Corp
	5.88%, 03/01/2024		400		413	9.88%, 04/15/2018			1,495		1,574
			$		1,632	Fresenius US Finance II Inc
						4.25%, 02/01/2021 ^(d)			2,060		2,124
	Food- 1.96%					Halyard Health Inc
	Albertsons Holdings LLC/Saturn Acquisition					6.25%, 10/15/2022 ^(d)			320		327
	Merger Sub Inc
	7.75%, 10/15/2022 ^(d)		2,290		2,256	Hologic Inc
	Bumble Bee Holdings Inc					6.25%, 08/01/2020			1,245		1,309
	9.00%, 12/15/2017 ^(d)		3,273		3,428	Mallinckrodt International Finance SA
						3.50%, 04/15/2018			136		134
	Darling Ingredients Inc					4.75%, 04/15/2023			1,104		1,060
	5.38%, 01/15/2022		2,595		2,601
	HJ Heinz Co					Mallinckrodt International Finance SA /
						Mallinckrodt CB LLC
	4.25%, 10/15/2020		2,212		2,234	5.75%, 08/01/2022 ^(d)			1,470		1,540
	Ingles Markets Inc					Teleflex Inc
	5.75%, 06/15/2023		780		796	5.25%,06/15/2024 ^(d)			585		594
	JBS USA LLC / JBS USA Finance Inc
	5.88%, 07/15/2024 ^(d)		1,796		1,805				$		16,460
	7.25%, 06/01/2021 ^(d)		3,467		3,692	Healthcare - Services - 5.96%
	7.25%, 06/01/2021 ^(d)		2,477		2,638	Acadia Healthcare Co Inc
	8.25%, 02/01/2020 ^(d)		1,193		1,277	5.13%, 07/01/2022 ^(d)			580		576
	Pilgrim's Pride Corp					6.13%, 03/15/2021			456		472
	7.88%, 12/15/2018		401		418	Amsurg Corp
	Post Holdings Inc					5.63%, 11/30/2020			1,075		1,107
	6.00%, 12/15/2022 ^(d)		4,230		4,082	5.63%, 07/15/2022 ^(d)			2,885		2,989
	6.75%, 12/01/2021 ^(d)		1,664		1,662	Centene Corp
	Smithfield Foods Inc					4.75%, 05/15/2022			245		248
	5.25%, 08/01/2018 ^(d)		1,620		1,669	CHS/Community Health Systems Inc
	5.88%, 08/01/2021 ^(d)		3,426		3,632	5.13%, 08/15/2018			1,890		1,965
	6.63%, 08/15/2022		1,600		1,744	5.13%, 08/01/2021			1,885		1,970
	7.75%, 07/01/2017		760		847	6.88%, 02/01/2022 ^(d)			5,925		6,384
	WhiteWave Foods Co/The					7.13%, 07/15/2020			1,325		1,434
	5.38%, 10/01/2022		275		289	8.00%, 11/15/2019			2,335		2,522
			$		35,070	DaVita HealthCare Partners Inc
						5.13%, 07/15/2024			4,150		4,233
	Food Service - 0.10%					5.75%, 08/15/2022			2,985		3,164
	Aramark Services Inc					6.63%, 11/01/2020			1,165		1,219
	5.75%, 03/15/2020		1,660		1,735	Envision Healthcare Corp
						5.13%, 07/01/2022 ^(d)			2,065		2,091
	Forest Products & Paper - 0.08%					Fresenius Medical Care US Finance II Inc
	Cascades Inc					4.13%, 10/15/2020 ^(d)			1,605		1,610
	5.50%, 07/15/2022 ^(d)		355		351	4.75%, 10/15/2024 ^(d)			1,310		1,314
						5.63%, 07/31/2019 ^(d)			1,664		1,783


Schedule of Investments
High Yield Fund I
October 31, 2014



		Principal					Principal
BONDS (continued)		Amount (000's) Value (000's)			BONDS (continued)	Amount (000's) Value (000's)

Healthcare - Services (continued)					Home Builders (continued)
Fresenius Medical Care US Finance II					Meritage Homes Corp (continued)
Inc (continued)					7.15%, 04/15/2020	$	315	$	347
5.88%, 01/31/2022 ^(d)	$	1,750	$	1,908	Ryland Group Inc/The
Fresenius Medical Care US Finance Inc					5.38%, 10/01/2022		1,485		1,455
5.75%, 02/15/2021 ^(d)		905		972	Standard Pacific Corp
6.50%, 09/15/2018 ^(d)		3,020		3,345	8.38%, 01/15/2021		1,135		1,325
HCA Holdings Inc					10.75%, 09/15/2016		566		650
6.25%, 02/15/2021		1,850		1,991	Taylor Morrison Communities Inc / Monarch
HCA Inc					Communities Inc
3.75%, 03/15/2019		750		752	5.25%, 04/15/2021 ^(d)		2,980		3,001
4.25%, 10/15/2019		2,965		3,013	WCI Communities Inc
4.75%, 05/01/2023		1,270		1,290	6.88%, 08/15/2021		741		749
5.00%, 03/15/2024		3,869		3,990	6.88%, 08/15/2021 ^(d)		271		274
5.25%, 04/15/2025		970		1,005			$		22,071
5.88%, 03/15/2022		1,519		1,667
5.88%, 05/01/2023		2,095		2,252	Insurance - 0.35%
6.50%, 02/15/2020		4,955		5,531	A-S Co-Issuer Subsidiary Inc / A-S Merger
7.05%, 12/01/2027		465		481	Sub LLC
					7.88%, 12/15/2020 ^(d)		765		788
7.50%, 02/15/2022		2,005		2,328
7.69%, 06/15/2025		1,430		1,616	Fidelity & Guaranty Life Holdings Inc
					6.38%, 04/01/2021 ^(d)		750		795
8.00%, 10/01/2018		1,200		1,377
HealthSouth Corp					Hartford Financial Services Group Inc/The
					8.13%, 06/15/2068 ^(e)		610		708
5.75%, 11/01/2024		228		239
IASIS Healthcare LLC / IASIS Capital Corp					Liberty Mutual Group Inc
					7.80%, 03/07/2087 ^(d)		1,436		1,680
8.38%, 05/15/2019		7,970		8,409
inVentiv Health Inc					Prudential Financial Inc
					5.63%, 06/15/2043 ^(e)		788		817
9.00%, 01/15/2018 ^(d)		409		424
LifePoint Hospitals Inc					USI Inc/NY
					7.75%, 01/15/2021 ^(d)		1,516		1,535
5.50%, 12/01/2021 ^(d)		728		763
MPH Acquisition Holdings LLC							$		6,323
6.63%, 04/01/2022 ^(d)		2,130		2,228	Internet - 0.30%
National Mentor Holdings Inc					CyrusOne LP / CyrusOne Finance Corp
12.50%, 02/15/2018 ^(d)		283		299	6.38%, 11/15/2022		885		932
Tenet Healthcare Corp					IAC/InterActiveCorp
4.38%, 10/01/2021		670		666	4.88%, 11/30/2018		1,140		1,174
4.50%, 04/01/2021		750		752	Netflix Inc
4.75%, 06/01/2020		700		716	5.75%, 03/01/2024 ^(d)		680		712
5.00%, 03/01/2019 ^(d)		1,381		1,383	Ymobile Corp
5.50%, 03/01/2019 ^(d)		705		721	8.25%, 04/01/2018 ^(d)		1,124		1,186
6.00%, 10/01/2020		2,743		2,949	Zayo Group LLC / Zayo Capital Inc
6.25%, 11/01/2018		4,858		5,277	10.13%, 07/01/2020		1,240		1,376
6.75%, 02/01/2020		2,365		2,501			$		5,380
6.88%, 11/15/2031		1,195		1,171
8.00%, 08/01/2020		1,184		1,261	Iron & Steel - 1.62%
8.13%, 04/01/2022		4,413		5,059	AK Steel Corp
United Surgical Partners International Inc					8.75%, 12/01/2018		995		1,087
9.00%, 04/01/2020		2,735		2,954	APERAM
Universal Health Services Inc					7.75%, 04/01/2018 ^(d)		2,000		2,070
3.75%, 08/01/2019 ^(d)		178		179	ArcelorMittal
4.75%, 08/01/2022 ^(d)		259		264	5.75%, 08/05/2020 ^(e)		6,014		6,382
		$		106,814	6.13%, 06/01/2018		1,390		1,487
					6.75%, 02/25/2022		5,140		5,706
Home Builders - 1.23%					7.50%, 10/15/2039		4,465		4,766
Brookfield Residential Properties Inc /					10.35%, 06/01/2019 ^(e)		2,545		3,143
Brookfield Residential US Corp					Commercial Metals Co
6.13%, 07/01/2022 ^(d)		628		667	6.50%, 07/15/2017		455		489
DR Horton Inc					7.35%, 08/15/2018		1,000		1,110
4.38%, 09/15/2022		1,545		1,526	Signode Industrial Group Lux SA/Signode
5.75%, 08/15/2023		2,870		3,060	Industrial Group US Inc
K Hovnanian Enterprises Inc					6.38%, 05/01/2022 ^(d)		600		582
7.00%, 01/15/2019 ^(d)		504		491	Steel Dynamics Inc
9.13%, 11/15/2020 ^(d)		285		309	5.13%, 10/01/2021 ^(d)		275		285
11.88%, 10/15/2015		805		866	5.25%, 04/15/2023		325		341
Lennar Corp					5.50%, 10/01/2024 ^(d)		220		233
4.50%, 06/15/2019		395		402	6.13%, 08/15/2019		390		419
4.75%, 12/15/2017		1,865		1,949	6.38%, 08/15/2022		320		348
4.75%, 11/15/2022 ^(e)		2,575		2,536	7.63%, 03/15/2020		500		528
6.95%, 06/01/2018		656		730			$		28,976
12.25%, 06/01/2017		255		312
M/I Homes Inc					Leisure Products & Services - 0.07%
8.63%, 11/15/2018		702		733	Viking Cruises Ltd
Meritage Homes Corp					8.50%, 10/15/2022 ^(d)		1,217		1,317
7.00%, 04/01/2022		635		689


Schedule of Investments
High Yield Fund I
October 31, 2014



			Principal						Principal
	BONDS (continued)	Amount (000's) Value (000's)					BONDS (continued)	Amount (000's) Value (000's)

	Lodging - 1.44%						Media (continued)
	Downstream Development Authority of the						CSC Holdings LLC
	Quapaw Tribe of Oklahoma						6.75%, 11/15/2021	$	1,680	$	1,869
	10.50%, 07/01/2019 ^(d)		$	435	$	463	7.63%, 07/15/2018		1,165		1,319
	Hilton Worldwide Finance LLC / Hilton						Cumulus Media Holdings Inc
	Worldwide Finance Corp						7.75%, 05/01/2019		3,945		4,044
	5.63%, 10/15/2021 ^(d)			710		748	DISH DBS Corp
	MGM Resorts International						4.25%, 04/01/2018		1,987		2,037
	6.75%, 10/01/2020			1,000		1,097	5.00%, 03/15/2023		882		879
	7.75%, 03/15/2022			2,500		2,881	5.13%, 05/01/2020		3,698		3,846
	8.63%, 02/01/2019			2,750		3,184	5.88%, 07/15/2022		437		463
	10.00%, 11/01/2016			1,230		1,393	6.75%, 06/01/2021		7,128		7,912
	MTR Gaming Group Inc						7.88%, 09/01/2019		170		197
	11.50%, 08/01/2019			3,945		4,330	Gannett Co Inc
	Seminole Hard Rock Entertainment Inc /						4.88%, 09/15/2021 ^(d)		710		716
	Seminole Hard Rock International LLC						5.13%, 10/15/2019		3,080		3,203
	5.88%, 05/15/2021 ^(d)			1,305		1,285	5.13%, 07/15/2020		1,805		1,868
	Station Casinos LLC						5.50%, 09/15/2024 ^(d)		880		909
	7.50%, 03/01/2021			4,260		4,452	6.38%, 10/15/2023		1,465		1,575
	Studio City Finance Ltd						7.13%, 09/01/2018		4,780		4,965
	8.50%, 12/01/2020 ^(d)			1,675		1,817	Gray Television Inc
	Wynn Las Vegas LLC / Wynn Las Vegas						7.50%, 10/01/2020		935		978
	Capital Corp						iHeartCommunications Inc
	7.75%, 08/15/2020			1,781		1,915	6.88%, 06/15/2018		853		774
	Wynn Macau Ltd						7.25%, 10/15/2027		505		419
	5.25%, 10/15/2021 ^(d)			2,150		2,150	9.00%, 12/15/2019		2,652		2,680
				$		25,715	9.00%, 03/01/2021		862		862
							11.25%, 03/01/2021		7,399		7,824
	Machinery - Construction & Mining - 0.21%						10.00%, 01/15/2018		2,565		2,143
	BlueLine Rental Finance Corp						Liberty Interactive LLC
	7.00%, 02/01/2019 ^(d)			1,610		1,695
							8.25%, 02/01/2030		750		818
	Terex Corp						Nielsen Finance LLC / Nielsen Finance Co
	6.00%, 05/15/2021			1,105		1,149	5.00%, 04/15/2022 ^(d)		4,711		4,782
	6.50%, 04/01/2020			950		1,000	Numericable Group SA
				$		3,844	4.88%, 05/15/2019 ^(d)		3,975		3,965
	Machinery - Diversified - 0.49%						6.00%, 05/15/2022 ^(d)		7,432		7,599
	Briggs & Stratton Corp						6.25%, 05/15/2024 ^(d)		2,567		2,640
	6.88%, 12/15/2020			775		854	Quebecor Media Inc
	Case New Holland Industrial Inc						5.75%, 01/15/2023		590		608
	7.88%, 12/01/2017			3,580		4,018	Quebecor World PLC
	Columbus McKinnon Corp/NY						0.00%, 01/15/2015 ^(a),(b),(c)		480		1
	7.88%, 02/01/2019			750		784	0.00%, 11/15/2025 ^(a),(b),(c)		1,075		3
	Manitowoc Co Inc/The						0.00%, 08/01/2027 ^(a),(b),(c)		830		2
	8.50%, 11/01/2020			1,650		1,786	Radio One Inc
	Zebra Technologies Corp						9.25%, 02/15/2020 ^(d)		300		298
	7.25%, 10/15/2022 ^(d)			1,191		1,254	RCN Telecom Services LLC / RCN Capital
				$		8,696	Corp
							8.50%, 08/15/2020 ^(d)		713		747
	Media- 7.94	%					Sinclair Television Group Inc
	AMC Networks Inc						5.38%, 04/01/2021		1,541		1,545
	7.75%, 07/15/2021			1,362		1,485	5.63%, 08/01/2024 ^(d)		585		578
	Cablevision Systems Corp						6.13%, 10/01/2022		630		652
	8.00%, 04/15/2020			4,237		4,851	6.38%, 11/01/2021		175		182
	CCO Holdings LLC / CCO Holdings Capital						Sirius XM Radio Inc
	Corp						4.25%, 05/15/2020 ^(d)		1,815		1,805
	5.13%, 02/15/2023			475		474	4.63%, 05/15/2023 ^(d)		1,200		1,158
	5.25%, 09/30/2022			2,910		2,928	5.75%, 08/01/2021 ^(d)		800		830
	6.50%, 04/30/2021			5,015		5,291	5.88%, 10/01/2020 ^(d)		62		65
	7.00%, 01/15/2019			315		328	6.00%, 07/15/2024 ^(d)		973		1,014
	8.13%, 04/30/2020			2,380		2,523	Unitymedia Hessen GmbH & Co KG /
	CCOH Safari LLC						Unitymedia NRW GmbH
	5.50%, 12/01/2022 ^(g)			1,399		1,413	5.50%, 01/15/2023 ^(d)		600		626
	5.75%, 12/01/2024 ^(g)			3,148		3,166	Unitymedia KabelBW GmbH
	Cequel Communications Holdings I LLC /						6.13%, 01/15/2025 ^(d)		607		634
	Cequel Capital Corp						Univision Communications Inc
	5.13%, 12/15/2021 ^(d)			2,205		2,153	5.13%, 05/15/2023 ^(d)		925		976
	5.13%, 12/15/2021 ^(d)			707		690	6.75%, 09/15/2022 ^(d)		4,987		5,536
	6.38%, 09/15/2020 ^(d)			3,442		3,588	6.88%, 05/15/2019 ^(d)		5,265		5,535
	Clear Channel Worldwide Holdings Inc						7.88%, 11/01/2020 ^(d)		1,500		1,622
	6.50%, 11/15/2022			2,122		2,186	8.50%, 05/15/2021 ^(d)		925		1,001
	6.50%, 11/15/2022			5,598		5,794	Videotron Ltd
	7.63%, 03/15/2020			5,731		6,096	5.00%, 07/15/2022		245		252
	7.63%, 03/15/2020			150		158	5.38%, 06/15/2024 ^(d)		874		900


Schedule of Investments
High Yield Fund I
October 31, 2014



		Principal					Principal
BONDS (continued)		Amount (000's) Value (000's)			BONDS (continued)	Amount (000's) Value (000's)

Media (continued)					Oil & Gas (continued)
VTR Finance BV					Chesapeake Energy Corp	(continued)
6.88%, 01/15/2024 ^(d)	$	1,302	$	1,367	6.13%, 02/15/2021	$	3,022	$	3,354
		$		142,347	6.50%, 08/15/2017		1,270		1,378
					6.63%, 08/15/2020		1,915		2,159
Mining - 1.19%					Cimarex Energy Co
Alcoa Inc					4.38%, 06/01/2024		657		668
5.13%, 10/01/2024		3,220		3,399	5.88%, 05/01/2022		1,877		2,017
5.40%, 04/15/2021		653		715	CITGO Petroleum Corp
5.72%, 02/23/2019		785		874	6.25%, 08/15/2022 ^(d)		862		877
5.87%, 02/23/2022		508		562	Comstock Resources Inc
5.90%, 02/01/2027		719		765	7.75%, 04/01/2019		550		539
6.15%, 08/15/2020		647		729	9.50%, 06/15/2020		1,201		1,267
6.75%, 01/15/2028		526		590	Concho Resources Inc
Aleris International Inc					5.50%, 04/01/2023		3,505		3,707
7.63%, 02/15/2018		356		367	6.50%, 01/15/2022		845		913
7.88%, 11/01/2020		545		567	7.00%, 01/15/2021		975		1,052
Coeur Mining Inc					Denbury Resources Inc
7.88%, 02/01/2021		1,383		1,200	4.63%, 07/15/2023		5,535		5,113
First Quantum Minerals Ltd					Energy XXI Gulf Coast Inc
6.75%, 02/15/2020 ^(d)		769		744
					6.88%, 03/15/2024 ^(d)		871		688
7.00%, 02/15/2021 ^(d)		769		755
7.25%, 10/15/2019 ^(d)		500		497	7.50%, 12/15/2021		1,412		1,172
7.25%, 05/15/2022 ^(d)		959		935	EP Energy LLC / Everest Acquisition Finance
					Inc
FMG Resources August 2006 Pty Ltd					6.88%, 05/01/2019		330		343
6.00%, 04/01/2017 ^(d)		268		273
6.88%, 02/01/2018 ^(d)		459		471	7.75%, 09/01/2022		1,552		1,637
6.88%, 04/01/2022 ^(d)		863		891	9.38%, 05/01/2020		11,244		12,284
8.25%, 11/01/2019 ^(d)		790		820	EXCO Resources Inc
					7.50%, 09/15/2018		5,437		4,798
Hecla Mining Co					8.50%, 04/15/2022		3,397		2,956
6.88%, 05/01/2021		1,977		1,878	Halcon Resources Corp
HudBay Minerals Inc					9.25%, 02/15/2022		1,730		1,406
9.50%, 10/01/2020		407		427	9.75%, 07/15/2020		360		300
Lundin Mining Corp					Hilcorp Energy I LP / Hilcorp Finance Co
7.50%, 11/01/2020 ^(d)		790		824
					5.00%, 12/01/2024 ^(d)		1,081		1,038
7.88%, 11/01/2022 ^(d)		690		718
					7.63%, 04/15/2021 ^(d)		1,331		1,404
New Gold Inc					8.00%, 02/15/2020 ^(d)		1,150		1,207
6.25%, 11/15/2022 ^(d)		1,545		1,510
					Jones Energy Holdings LLC / Jones Energy
Taseko Mines Ltd					Finance Corp
7.75%, 04/15/2019		845		801	6.75%, 04/01/2022 ^(d)		1,500		1,432
		$		21,312	Jupiter Resources Inc
Miscellaneous Manufacturing - 0.15%					8.50%, 10/01/2022 ^(d)		1,325		1,169
Amsted Industries Inc					Laredo Petroleum Inc
5.38%, 09/15/2024 ^(d)		640		640	7.38%, 05/01/2022		395		411
Bombardier Inc					Linn Energy LLC / Linn Energy Finance
4.75%, 04/15/2019 ^(d)		683		702	Corp
6.13%, 01/15/2023 ^(d)		398		410	6.25%, 11/01/2019 ^(e)		5,990		5,511
7.50%, 03/15/2018 ^(d)		800		888	6.50%, 09/15/2021		3,651		3,341
		$		2,640	7.75%, 02/01/2021		5,846		5,729
					8.63%, 04/15/2020		6,725		6,742
Office & Business Equipment - 0.08%					MEG Energy Corp
CDW LLC / CDW Finance Corp					6.50%, 03/15/2021 ^(d)		700		693
6.00%, 08/15/2022		573		604	7.00%, 03/31/2024 ^(d)		350		352
8.50%, 04/01/2019		764		810	Memorial Resource Development Corp
		$		1,414	5.88%, 07/01/2022 ^(d)		1,080		1,053
Oil & Gas - 10.39%					Newfield Exploration Co
Antero Resources Corp					5.63%, 07/01/2024		5,494		5,906
5.13%, 12/01/2022 ^(d)		3,514		3,515	5.75%, 01/30/2022		8,470		9,169
Antero Resources Finance Corp					6.88%, 02/01/2020		500		519
5.38%, 11/01/2021		1,995		2,025	Oasis Petroleum Inc
6.00%, 12/01/2020		1,587		1,650	6.88%, 03/15/2022		2,390		2,486
Baytex Energy Corp					Ocean Rig UDW Inc
					7.25%, 04/01/2019 ^(d)		851		728
5.13%, 06/01/2021 ^(d)		638		622
5.63%, 06/01/2024 ^(d)		238		230	Parker Drilling Co
California Resources Corp					6.75%, 07/15/2022		600		546
5.00%, 01/15/2020 ^(d)		1,987		2,016	7.50%, 08/01/2020		944		911
5.50%, 09/15/2021 ^(d)		2,624		2,676	Precision Drilling Corp
					5.25%, 11/15/2024 ^(d)		903		840
6.00%, 11/15/2024 ^(d)		4,816		4,912
Chesapeake Energy Corp					6.50%, 12/15/2021		435		446
3.25%, 03/15/2016		254		254	6.63%, 11/15/2020		740		762
4.88%, 04/15/2022		7,338		7,504	QEP Resources Inc
5.38%, 06/15/2021		640		667	5.25%, 05/01/2023		1,059		1,030
5.75%, 03/15/2023		640		701	5.38%, 10/01/2022		1,875		1,847


Schedule of Investments
High Yield Fund I
October 31, 2014



		Principal					Principal
BONDS (continued)		Amount (000's) Value (000's)			BONDS (continued)		Amount (000's) Value (000's)

Oil & Gas (continued)					Oil & Gas Services (continued)
QEP Resources Inc (continued)					Key Energy Services Inc
6.88%, 03/01/2021	$	1,375	$	1,478	6.75%, 03/01/2021	$	1,232	$	1,096
Range Resources Corp					Petroleum Geo-Services ASA
5.00%, 03/15/2023		700		731	7.38%, 12/15/2018 ^(d)		1,023		992
5.75%, 06/01/2021		2,755		2,907	PHI Inc
Rosetta Resources Inc					5.25%, 03/15/2019		419		414
5.63%, 05/01/2021		3,510		3,405	Pioneer Energy Services Corp
5.88%, 06/01/2022		3,709		3,561	6.13%, 03/15/2022 ^(d)		908		844
5.88%, 06/01/2024		1,869		1,794	Sea Trucks Group Ltd
RSP Permian Inc					9.00%, 03/26/2018 ^(d)		1,450		1,247
6.63%, 10/01/2022 ^(d)		338		337	Trinidad Drilling Ltd
Sabine Oil & Gas LLC / Sabine Oil & Gas					7.88%, 01/15/2019 ^(d)		1,525		1,556
Finance Corp							$		11,909
9.75%, 02/15/2017		558		530
Samson Investment Co					Packaging & Containers - 3.11%
9.75%, 02/15/2020 ^(e)		962		712	Ardagh Packaging Finance PLC
					9.13%, 10/15/2020 ^(d)		641		691
SandRidge Energy Inc
7.50%, 03/15/2021		8,740		7,866	Ardagh Packaging Finance PLC / Ardagh
7.50%, 02/15/2023		2,335		2,078	Holdings USA Inc
					6.25%, 01/31/2019 ^(d)		335		338
8.13%, 10/15/2022		4,045		3,661	7.00%, 11/15/2020 ^(d)		137		140
Seventy Seven Energy Inc					9.13%, 10/15/2020 ^(d)		197		211
6.50%, 07/15/2022 ^(d)		471		443
Seventy Seven Operating LLC					Ball Corp
6.63%, 11/15/2019		575		569	4.00%, 11/15/2023		600		576
SM Energy Co					5.00%, 03/15/2022		575		602
5.00%, 01/15/2024		680		636	5.75%, 05/15/2021		290		304
6.50%, 11/15/2021		1,670		1,733	6.75%, 09/15/2020		250		262
6.50%, 01/01/2023		250		258	Berry Plastics Corp
6.63%, 02/15/2019		1,433		1,483	5.50%, 05/15/2022		1,160		1,164
Stone Energy Corp					9.75%, 01/15/2021		12,755		14,237
7.50%, 11/15/2022		1,842		1,718	Beverage Packaging Holdings Luxembourg II
Summit Midstream Holdings LLC / Summit					SA / Beverage Packaging Holdings II
					5.63%, 12/15/2016 ^(d)		1,370		1,374
Midstream Finance Corp					6.00%, 06/15/2017 ^(d)		2,125		2,119
5.50%, 08/15/2022		315		315
7.50%, 07/01/2021		337		366	Constar International
					0.00%, PIK 0.00%, 12/31/2017 ^{(a),(b),(c),(e),(f)}		605		101
Swift Energy Co
7.13%, 06/01/2017		375		356	Crown Americas LLC / Crown Americas
7.88%, 03/01/2022		815		736	Capital Corp IV
Talos Production LLC / Talos Production					4.50%, 01/15/2023		624		613
Finance Inc					Graphic Packaging International Inc
9.75%, 02/15/2018 ^(d)		589		593	4.75%, 04/15/2021		714		721
Teine Energy Ltd					Novelis Inc
6.88%, 09/30/2022 ^(d)		630		597	8.75%, 12/15/2020		2,005		2,188
Tesoro Corp					Reynolds Group Issuer Inc / Reynolds Group
5.13%, 04/01/2024		328		329	Issuer LLC / Reynolds Group Issuer
Ultra Petroleum Corp					(Luxembourg) S.A.
5.75%, 12/15/2018 ^(d)		1,550		1,535	5.75%, 10/15/2020		3,160		3,287
					6.88%, 02/15/2021 ^(e)		2,295		2,438
6.13%, 10/01/2024 ^(d)		946		895
Unit Corp					7.13%, 04/15/2019		700		727
6.63%, 05/15/2021		2,750		2,743	7.88%, 08/15/2019		6,580		7,049
W&T Offshore Inc					8.25%, 02/15/2021		1,805		1,940
8.50%, 06/15/2019		1,404		1,369	8.50%, 05/15/2018		1,450		1,503
Whiting Petroleum Corp					9.00%, 04/15/2019		1,200		1,254
5.00%, 03/15/2019		2,940		3,043	9.88%, 08/15/2019		8,785		9,543
WPX Energy Inc					Sealed Air Corp
					5.25%, 04/01/2023 ^(d)		367		377
5.25%, 01/15/2017		1,250		1,306	6.50%, 12/01/2020 ^(d)		500		550
5.25%, 09/15/2024		1,756		1,712	8.13%, 09/15/2019 ^(d)		750		813
6.00%, 01/15/2022		3,518		3,685	8.38%, 09/15/2021 ^(d)		575		651
		$		186,152
							$		55,773
Oil & Gas Services - 0.66%
Basic Energy Services Inc					Pharmaceuticals - 1.68%
7.75%, 02/15/2019		150		146	Endo Finance LLC
					5.75%, 01/15/2022 ^(d)		440		442
7.75%, 10/15/2022		1,112		1,084
Compressco Partners LP / Compressco					Endo Finance LLC & Endo Finco Inc
					5.38%, 01/15/2023 ^(d)		4,600		4,497
Finance Inc					7.00%, 07/15/2019 ^(d)		1,560		1,642
7.25%, 08/15/2022 ^(d)		980		970
					7.00%, 12/15/2020 ^(d)		207		218
Exterran Partners LP / EXLP Finance Corp					7.25%, 01/15/2022 ^(d)		2,110		2,253
6.00%, 10/01/2022 ^(d)		580		557
Hiland Partners LP / Hiland Partners Finance					Grifols Worldwide Operations Ltd
					5.25%, 04/01/2022 ^(d)		660		677
Corp
5.50%, 05/15/2022 ^(d)		294		290	Salix Pharmaceuticals Ltd
					6.00%, 01/15/2021 ^(d)		490		530
7.25%, 10/01/2020 ^(d)		2,565		2,713


Schedule of Investments
High Yield Fund I
October 31, 2014



		Principal						Principal
BONDS (continued)		Amount (000's) Value (000's)			BONDS (continued)			Amount (000's) Value (000's)

Pharmaceuticals (continued)					Pipelines (continued)
Valeant Pharmaceuticals International					Tesoro Logistics LP / Tesoro Logistics
5.63%, 12/01/2021 ^(d)	$	519	$	514	Finance Corp (continued)
6.38%, 10/15/2020 ^(d)		11,000		11,289	6.13%, 10/15/2021		$	775	$	796
6.75%, 08/15/2021 ^(d)		338		349	6.25%, 10/15/2022 ^(d)			1,613		1,669
6.75%, 08/15/2018 ^(d)		2,739		2,913				$		58,821
6.88%, 12/01/2018 ^(d)		2,485		2,572
7.00%, 10/01/2020 ^(d)		850		890	Real Estate - 0.15%
7.25%, 07/15/2022 ^(d)		330		348	Kennedy-Wilson Inc
7.50%, 07/15/2021 ^(d)		973		1,041	5.88%, 04/01/2024			494		504
		$		30,175	Mattamy Group Corp
					6.50%, 11/15/2020 ^(d)			647		655
Pipelines - 3.28%					Realogy Group LLC
Access Midstream Partners LP / ACMP					7.63%, 01/15/2020 ^(d)			1,415		1,535
Finance Corp								$		2,694
4.88%, 05/15/2023		3,527		3,686
4.88%, 03/15/2024		1,060		1,108	REITS- 0.96	%
5.88%, 04/15/2021		1,168		1,235	Crown Castle International Corp
6.13%, 07/15/2022		4,671		5,080	4.88%, 04/15/2022			647		654
Atlas Pipeline Partners LP / Atlas Pipeline					5.25%, 01/15/2023			1,056		1,081
Finance Corp					Iron Mountain Inc
4.75%, 11/15/2021		775		773	5.75%, 08/15/2024			5,105		5,207
5.88%, 08/01/2023		729		756	7.75%, 10/01/2019			4,809		5,170
Crestwood Midstream Partners LP /					8.38%, 08/15/2021			1,603		1,667
Crestwood Midstream Finance Corp					MPT Operating Partnership LP / MPT Finance
6.13%, 03/01/2022		727		734	Corp
Energy Transfer Equity LP					5.50%, 05/01/2024			2,915		3,017
5.88%, 01/15/2024		2,710		2,845	Sabra Health Care LP / Sabra Capital Corp
7.50%, 10/15/2020		2,522		2,901	5.50%, 02/01/2021			310		321
Genesis Energy LP								$		17,117
5.63%, 06/15/2024		625		610	Retail - 2.43%
Genesis Energy LP / Genesis Energy Finance					1011778 BC ULC / New Red Finance Inc
Corp					6.00%, 04/01/2022 ^(d)			705		715
5.75%, 02/15/2021		725		729	AmeriGas Finance LLC/AmeriGas Finance
7.88%, 12/15/2018		1,375		1,433	Corp
Kinder Morgan Inc/DE					6.75%, 05/20/2020			3,640		3,877
5.00%, 02/15/2021 ^(d)		484		511	7.00%, 05/20/2022			4,238		4,577
5.63%, 11/15/2023 ^(d)		484		532	CEC Entertainment Inc
MarkWest Energy Partners LP / MarkWest					8.00%, 02/15/2022 ^(d)			320		307
Energy Finance Corp					Claire's Stores Inc
4.50%, 07/15/2023		4,024		4,125	6.13%, 03/15/2020 ^(d)			728		673
5.50%, 02/15/2023		1,975		2,103	8.88%, 03/15/2019			2,463		2,100
6.25%, 06/15/2022		569		613	9.00%, 03/15/2019 ^(d)			1,527		1,558
6.75%, 11/01/2020		865		917	CST Brands Inc
Regency Energy Partners LP / Regency					5.00%, 05/01/2023			1,535		1,523
Energy Finance Corp					Ferrellgas LP / Ferrellgas Finance Corp
4.50%, 11/01/2023		2,395		2,377	6.75%, 01/15/2022			3,090		3,113
5.00%, 10/01/2022		432		441	Guitar Center Inc
5.50%, 04/15/2023		2,130		2,204	6.50%, 04/15/2019 ^(d)			611		557
5.88%, 03/01/2022		3,101		3,302	JC Penney Corp Inc
6.50%, 07/15/2021		2,125		2,258	8.13%, 10/01/2019			199		191
6.88%, 12/01/2018		2,565		2,661	L Brands Inc
Rose Rock Midstream LP / Rose Rock					5.63%, 02/15/2022			1,715		1,839
Finance Corp					5.63%, 10/15/2023			2,220		2,381
5.63%, 07/15/2022 ^(d)		422		421	6.63%, 04/01/2021			459		520
Sabine Pass Liquefaction LLC					8.50%, 06/15/2019			1,500		1,792
5.63%, 02/01/2021 ^(e)		411		431	Landry's Inc
5.63%, 04/15/2023		2,674		2,768	9.38%, 05/01/2020 ^(d)			725		775
5.75%, 05/15/2024 ^(d)		635		656	Michaels FinCo Holdings LLC / Michaels
6.25%, 03/15/2022 ^(d)		560		603	FinCo Inc
SemGroup Corp					7.50%, PIK 8.25%, 08/01/2018 ^(d),(f)			421		427
7.50%, 06/15/2021		484		509	Neebo Inc
Targa Resources Partners LP / Targa					15.00%, 06/30/2016 ^(d)			328		344
Resources Partners Finance Corp					Neiman Marcus Group LTD LLC
4.13%, 11/15/2019 ^(d)		1,635		1,660	8.00%, 10/15/2021 ^(d)			1,029		1,098
4.25%, 11/15/2023		620		614	New Albertsons Inc
5.25%, 05/01/2023		850		893	6.63%, 06/01/2028			66		55
6.38%, 08/01/2022		1,300		1,397	7.75%, 06/15/2026			265		250
6.88%, 02/01/2021		250		269	8.00%, 05/01/2031			405		388
Tesoro Logistics LP / Tesoro Logistics					8.70%, 05/01/2030			95		94
Finance Corp					Party City Holdings Inc
5.50%, 10/15/2019 ^(d)		1,230		1,264	8.88%, 08/01/2020			1,380		1,497
5.88%, 10/01/2020		916		937


Schedule of Investments
High Yield Fund I
October 31, 2014



		Principal					Principal
BONDS (continued)		Amount (000's) Value (000's)			BONDS (continued)		Amount (000's) Value (000's)

Retail (continued)					Telecommunications (continued)
Radio Systems Corp					Alcatel-Lucent USA Inc (continued)
8.38%, 11/01/2019 ^(d)	$	839	$	909	6.45%, 03/15/2029	$	794	$	764
Real Mex Restaurants Inc					6.75%, 11/15/2020 ^(d)		897		924
11.00%, PIK 0.73%, 03/21/2016 ^(b),(c),(f)		172		172	Altice Financing SA
Rite Aid Corp					6.50%, 01/15/2022 ^(d)		478		491
6.75%, 06/15/2021		1,945		2,077	7.88%, 12/15/2019 ^(d)		262		279
8.00%, 08/15/2020		4,243		4,582	Altice Finco SA
9.25%, 03/15/2020		1,430		1,580	8.13%, 01/15/2024 ^(d)		200		210
Sally Holdings LLC / Sally Capital Inc					9.88%, 12/15/2020 ^(d)		200		223
5.50%, 11/01/2023		742		783	Altice SA
Serta Simmons Holdings LLC					7.75%, 05/15/2022 ^(d)		4,944		5,191
8.13%, 10/01/2020 ^(d)		800		858	Avaya Inc
Suburban Propane Partners LP/Suburban					7.00%, 04/01/2019 ^(d)		915		899
Energy Finance Corp					9.00%, 04/01/2019 ^(d)		900		922
7.38%, 08/01/2021		797		857	10.50%, 03/01/2021 ^(d)		1,320		1,157
Tops Holding Corp / Tops Markets LLC					CenturyLink Inc
8.88%, 12/15/2017		1,055		1,084	6.45%, 06/15/2021		4,080		4,468
		$		43,553	6.75%, 12/01/2023		895		993
					Cincinnati Bell Inc
Semiconductors - 0.43%					8.38%, 10/15/2020		346		371
Advanced Micro Devices Inc					8.75%, 03/15/2018		116		120
6.75%, 03/01/2019		828		782	Citizens Communications Co
7.00%, 07/01/2024		522		458	7.13%, 03/15/2019		3,040		3,352
7.75%, 08/01/2020		705		663	Clearwire Communications LLC/Clearwire
Amkor Technology Inc					Finance Inc
6.38%, 10/01/2022		521		522	14.75%, 12/01/2016 ^(d)		680		840
6.63%, 06/01/2021		206		208	CommScope Inc
Freescale Semiconductor Inc					5.00%, 06/15/2021 ^(d)		580		579
5.00%, 05/15/2021 ^(d)		205		202
					5.50%, 06/15/2024 ^(d)		790		799
6.00%, 01/15/2022 ^(d)		2,189		2,244
					Embarq Corp
8.05%, 02/01/2020		804		848	8.00%, 06/01/2036		10,461		11,612
Micron Technology Inc					Frontier Communications Corp
5.50%, 02/01/2025 ^(d)		712		721
					6.25%, 09/15/2021		194		200
NXP BV / NXP Funding LLC					6.88%, 01/15/2025		3,622		3,668
3.50%, 09/15/2016 ^(d)		200		203
5.75%, 02/15/2021 ^(d)		297		313	8.50%, 04/15/2020		410		473
5.75%, 03/15/2023 ^(d)		232		245	8.75%, 04/15/2022		210		243
					9.00%, 08/15/2031		3,828		4,153
Sensata Technologies BV					9.25%, 07/01/2021		1,112		1,326
5.63%, 11/01/2024 ^(d)		316		334
					Goodman Networks Inc
		$		7,743	12.13%, 07/01/2018		1,528		1,635
Software - 2.20%					Hughes Satellite Systems Corp
Activision Blizzard Inc					6.50%, 06/15/2019		1,735		1,878
5.63%, 09/15/2021 ^(d)		3,899		4,148	Inmarsat Finance PLC
6.13%, 09/15/2023 ^(d)		1,010		1,093	4.88%, 05/15/2022 ^(d)		2,240		2,240
Audatex North America Inc					Intelsat Jackson Holdings SA
6.00%, 06/15/2021 ^(d)		1,048		1,108	5.50%, 08/01/2023		6,120		6,135
6.13%, 11/01/2023 ^(d)		96		102	6.63%, 12/15/2022		5,225		5,499
First Data Corp					7.25%, 10/15/2020		1,570		1,676
6.75%, 11/01/2020 ^(d)		869		930	7.50%, 04/01/2021		650		704
7.38%, 06/15/2019 ^(d)		2,405		2,549	8.50%, 11/01/2019		2,490		2,596
8.25%, 01/15/2021 ^(d)		2,248		2,439	Intelsat Luxembourg SA
8.75%, PIK 10.00%, 01/15/2022 ^(d),(f)		1,145		1,251	7.75%, 06/01/2021		4,222		4,412
11.75%, 08/15/2021		2,912		3,414	8.13%, 06/01/2023		1,714		1,822
12.63%, 01/15/2021		9,820		11,858	Level 3 Communications Inc
10.63%, 06/15/2021		1,719		1,981	8.88%, 06/01/2019		630		676
11.25%, 01/15/2021		1,879		2,165	11.88%, 02/01/2019		3,835		4,132
IMS Health Inc					Level 3 Escrow II Inc
6.00%, 11/01/2020 ^(d)		823		854	5.38%, 08/15/2022 ^(d)		876		891
Infor Software Parent LLC / Infor Software					Level 3 Financing Inc
Parent Inc					6.13%, 01/15/2021 ^(d)		3,033		3,181
7.13%, PIK 7.88%, 05/01/2021 ^(d),(f)		567		574	7.00%, 06/01/2020		1,692		1,806
Infor US Inc					8.13%, 07/01/2019		8,070		8,635
9.38%, 04/01/2019		1,000		1,088	8.63%, 07/15/2020		2,475		2,722
Nuance Communications Inc					9.38%, 04/01/2019		3,325		3,554
5.38%, 08/15/2020 ^(d)		1,160		1,166	NII Capital Corp
Sophia LP / Sophia Finance Inc					0.00%, 04/01/2021 ^(a)		3,317		663
9.75%, 01/15/2019 ^(d)		2,555		2,740	NII International Telecom SCA
		$		39,460	0.00%, 08/15/2019 ^(a),(d)		873		567
					0.00%, 08/15/2019 ^(a),(d)		1,188		760
Telecommunications - 11.63%					Nokia OYJ
Alcatel-Lucent USA Inc					5.38%, 05/15/2019		617		663
4.63%, 07/01/2017 ^(d)		787		800	6.63%, 05/15/2039		216		234


Schedule of Investments
High Yield Fund I
October 31, 2014



		Principal						Principal
BONDS (continued)		Amount (000's) Value (000's)			BONDS (continued)			Amount (000's) Value (000's)

Telecommunications (continued)					Transportation (continued)
Qwest Capital Funding Inc					Martin Midstream Partners LP / Martin
6.88%, 07/15/2028	$	159	$	161	Midstream Finance Corp
7.75%, 02/15/2031		1,780		1,816	7.25%, 02/15/2021		$	1,043	$	1,064
Qwest Corp					Navios Maritime Acquisition Corp / Navios
6.88%, 09/15/2033		4,436		4,471	Acquisition Finance US Inc
7.25%, 09/15/2025		310		365	8.13%, 11/15/2021 ^(d)			610		621
SBA Telecommunications Inc					Navios Maritime Holdings Inc / Navios
5.75%, 07/15/2020		1,280		1,338	Maritime Finance II US Inc
SoftBank Corp					7.38%, 01/15/2022 ^(d)			445		447
4.50%, 04/15/2020 ^(d)		1,988		2,013	8.13%, 02/15/2019			175		169
Sprint Capital Corp					Navios South American Logistics Inc / Navios
6.88%, 11/15/2028		2,840		2,762	Logistics Finance US Inc
6.90%, 05/01/2019		534		566	7.25%, 05/01/2022 ^(d)			1,289		1,299
8.75%, 03/15/2032		7,016		7,840	Ridgebury Crude Tankers LLC
Sprint Communications Inc					7.63%, 03/20/2017 ^(d)			468		475
6.00%, 12/01/2016		1,067		1,130	Ultrapetrol Bahamas Ltd
6.00%, 11/15/2022		1,718		1,714	8.88%, 06/15/2021			1,782		1,871
7.00%, 03/01/2020 ^(d)		1,884		2,102	XPO Logistics Inc
7.00%, 08/15/2020		3,770		3,996	7.88%, 09/01/2019 ^(d)			337		353
9.00%, 11/15/2018 ^(d)		3,261		3,836				$		8,774
11.50%, 11/15/2021		374		481
Sprint Corp					Trucking & Leasing - 0.06%
7.13%, 06/15/2024 ^(d)		4,333		4,452	Jurassic Holdings III Inc
					6.88%, 02/15/2021 ^(d)			1,035		1,043
7.25%, 09/15/2021 ^(d)		3,071		3,247
7.88%, 09/15/2023 ^(d)		5,728		6,200
Syniverse Holdings Inc					TOTAL BONDS			$		1,588,887
9.13%, 01/15/2019		1,260		1,323				Principal
Telecom Italia Capital SA					CONVERTIBLE BONDS - 0.04%			Amount (000's) Value (000's)
6.00%, 09/30/2034		2,580		2,541	Electric - 0.04%
Telecom Italia SpA					Upstate New York Power Producers Inc
5.30%, 05/30/2024 ^(d)		880		891	20.00%, 06/15/2017 ^(c),(d)			267		614
T-Mobile USA Inc
5.25%, 09/01/2018		467		484
6.00%, 03/01/2023		2,737		2,819	Retail - 0.00%
6.13%, 01/15/2022		1,585		1,642	Real Mex Restaurants Inc
6.25%, 04/01/2021		975		1,018	1.12%, PIK 0.00%, 03/21/2018 ^(b),(c),(f)			81		—
6.38%, 03/01/2025		3,282		3,373
6.46%, 04/28/2019		318		331	TOTAL CONVERTIBLE BONDS			$		614
6.50%, 01/15/2024		1,097		1,149	SENIOR FLOATING RATE INTERESTS - Principal
6.54%, 04/28/2020		3,455		3,645	6.09	%		Amount (000's) Value (000's)
6.63%, 11/15/2020		1,679		1,769	Advertising - 0.12%
6.63%, 04/28/2021		3,936		4,148	Advantage Sales & Marketing Inc, Delay-
6.63%, 04/01/2023		2,108		2,224	Draw Term Loan B-DD
6.73%, 04/28/2022		4,463		4,720	0.00%, 07/21/2021 ^(e),(h)		$	10	$	10
6.84%, 04/28/2023		2,111		2,232	Advantage Sales & Marketing Inc, Term
tw telecom holdings inc					Loan
5.38%, 10/01/2022		2,020		2,232	0.00%, 07/21/2022 ^(e),(h)			790		784
UPCB Finance III Ltd					Advantage Sales & Marketing Inc, Term Loan
6.63%, 07/01/2020 ^(d)		2,115		2,226
					B
UPCB Finance VI Ltd					0.00%, 07/21/2021 ^(e),(h)			395		391
6.88%, 01/15/2022 ^(d)		370		404
					RH Donnelley Inc, Term Loan
Virgin Media Finance PLC					9.75%, 12/31/2016 ^(e)			320		225
6.00%, 10/15/2024 ^(d)		1,885		1,960
					9.75%, 12/31/2016 ^(e)			437		307
6.38%, 04/15/2023 ^(d)		578		611
					Vertis Inc, Term Loan EXIT
Virgin Media Secured Finance PLC					0.00%, 12/31/2015 ^(a),(b),(e)			1,359		2
5.38%, 04/15/2021 ^(d)		1,425		1,479
					Visant Corp, Term Loan
West Corp					7.00%, 08/13/2021 ^(e)			450		443
5.38%, 07/15/2022 ^(d)		1,432		1,389
Wind Acquisition Finance SA								$		2,162
4.75%, 07/15/2020 ^(d)		4,695		4,589	Aerospace & Defense - 0.02%
7.38%, 04/23/2021 ^(d)		849		830	Ducommun Inc, Term Loan B1
Windstream Corp					4.75%, 06/30/2017 ^(e)			414		413
7.50%, 06/01/2022		4,408		4,684
7.75%, 10/15/2020		915		974
7.75%, 10/01/2021		1,595		1,707	Airlines - 0.05%
7.88%, 11/01/2017		145		161	Delta Air Lines Inc, Term Loan B1
					3.25%, 10/18/2018 ^(e)			846		826
8.13%, 09/01/2018		275		287
		$		208,470
					Automobile Manufacturers - 0.39%
Transportation - 0.49%					Chrysler Group LLC, Term Loan B
Bluewater Holding BV					3.25%, 12/31/2018 ^(e)			2,090		2,067
10.00%, 12/10/2019 ^(d)		2,500		2,475
					3.50%, 05/24/2017 ^(e)			1,239		1,232


Schedule of Investments
High Yield Fund I
October 31, 2014



SENIOR FLOATING RATE INTERESTS		Principal			SENIOR FLOATING RATE INTERESTS			Principal
(continued)		Amount (000's) Value (000's)			(continued)			Amount (000's) Value (000's)

Automobile Manufacturers (continued)					Entertainment (continued)
Navistar Inc, Term Loan B					Scientific Games International Inc, Term Loan
5.75%, 08/16/2017 ^(e)	$	3,307	$	3,313	B1
Wabash National Corp, Term Loan B					0.00%, 05/22/2020 ^(e),(h)		$	206	$	202
4.50%, 05/04/2019 ^(e)		330		328	0.00%, 05/22/2020 ^(e),(h)			177		173
		$		6,940	0.00%, 05/22/2020 ^(e),(h)			31		30
					0.00%, 10/18/2020 ^(e),(h)			15		14
Automobile Parts & Equipment - 0.02%					0.00%, 10/18/2020 ^(e),(h)			20		19
Remy International Inc, Term Loan B					Scientific Games International Inc, Term Loan
4.25%, 02/28/2020 ^(e)		443		438
					B2
					6.00%, 09/17/2021 ^(e)			6,700		6,555
Chemicals - 0.11%					Shingle Springs Tribal Gaming Authority,
Axalta Coating Systems US Holdings Inc,					Term Loan B
Term Loan					6.25%, 08/22/2019 ^(e)			582		586
3.75%, 02/01/2020 ^(e)		1,034		1,016	WMG Acquisition Corp, Term Loan B
3.75%, 02/01/2020 ^(e)		739		727	3.75%, 07/20/2020 ^(e)			448		433
AZ Chem US Inc, Term Loan								$		15,919
7.50%, 06/10/2022 ^(e)		247		246
					Food- 0.63	%
		$		1,989	Albertson's Holdings LLC, Term Loan B4
Commercial Services - 0.09%					4.50%, 08/11/2021 ^(e)			2,225		2,225
Catalent Pharma Solutions Inc, Term Loan					Dole Food Co Inc, Term Loan B
6.50%, 12/31/2017 ^(e)		184		184	4.50%, 10/25/2018 ^(e)			163		162
Harland Clarke Holdings Corp, Term Loan					4.50%, 12/01/2018 ^(e)			56		55
B2					4.50%, 12/01/2018 ^(e)			163		162
5.48%, 06/30/2017 ^(e)		498		499	4.50%, 12/01/2018 ^(e)			163		162
5.48%, 06/30/2017 ^(e)		82		82	4.50%, 12/01/2018 ^(e)			163		163
ServiceMaster Co LLC/The, Term Loan B					4.50%, 12/01/2018 ^(e)			163		163
4.25%, 06/25/2021 ^(e)		910		901	4.50%, 12/01/2018 ^(e)			163		163
		$		1,666	4.50%, 12/01/2018 ^(e)			163		163
					5.75%, 11/01/2018 ^(e)			1		1
Computers - 0.02%					HJ Heinz Co, Term Loan B2
CDW LLC, Term Loan B					3.50%, 03/27/2020 ^(e)			2,605		2,588
3.25%, 04/30/2020 ^(e)		296		289	3.50%, 06/05/2020 ^(e)			2,527		2,511
					SUPERVALU Inc, Term Loan
Consumer Products - 0.08%					4.50%, 03/21/2019 ^(e)			2,798		2,760
Dell International LLC, Term Loan B								$		11,278
4.50%, 03/24/2020 ^(e)		1,393		1,394
					Food Service - 0.14%
					Aramark Services Inc, Term Loan F
Diversified Financial Services - 0.13%					3.25%, 02/21/2021 ^(e)			2,612		2,572
Delos Finance Sarl, Term Loan B
3.50%, 02/26/2021 ^(e)		1,265		1,257
					Healthcare - Services - 0.18%
Sears Roebuck Acceptance Corp, Term Loan					inVentiv Health Inc, Term Loan B4
B					7.75%, 05/15/2018 ^(e)			867		855
5.50%, 06/30/2018 ^(e)		1,166		1,132
					MPH Acquisition Holdings LLC, Term Loan
		$		2,389	B
Electric - 0.46%					4.00%, 03/19/2021 ^(e)			271		266
Energy Future Intermediate Holding Co LLC,					United Surgical Partners International Inc,
DIP Term Loan					Term Loan
4.25%, 06/10/2016 ^(e)		433		432	4.75%, 04/03/2019 ^(e)			2,127		2,126
Texas Competitive Electric Holdings Co LLC,								$		3,247
Term Loan EXT					Internet - 0.05%
4.65%, 10/10/2017 ^(e)		6,239		4,537
					Go Daddy Operating Co LLC, Term Loan B
Texas Competitive Electric Holdings Co LLC,					4.75%, 05/05/2021 ^(e)			580		577
Term Loan NONEXT					Zayo Group LLC, Term Loan B
4.65%, 10/10/2014 ^(e)		4,489		3,246
					4.00%, 06/15/2019 ^(e)			238		236
		$		8,215				$		813

Entertainment - 0.89%					Lodging - 0.21%
American Casino & Entertainment Properties					ROC Finance LLC, Term Loan B
LLC, Term Loan B					5.00%, 03/27/2019 ^(e)			1,270		1,214
4.50%, 07/03/2019 ^(e)		568		566
					Station Casinos LLC, Term Loan B
Delta 2 Lux Sarl, Term Loan B					4.25%, 02/25/2018 ^(e)			1,049		1,037
7.75%, 07/29/2022 ^(e)		1,100		1,095
					4.25%, 02/25/2020 ^(e)			1,602		1,583
Graton Economic Development Authority,								$		3,834
Term Loan B
9.00%, 08/14/2018 ^(e)		2,753		2,829	Media- 0.83	%
9.00%, 08/14/2018 ^(e)		298		307	iHeartCommunications Inc, Term Loan B-
Mohegan Tribal Gaming Authority, Term					NEW
Loan B					3.80%, 01/29/2016 ^(e)			1,498		1,485
5.50%, 11/19/2019 ^(e)		3,206		3,110	7.65%, 01/29/2016 ^(e)			1,776		1,760


Schedule of Investments
High Yield Fund I
October 31, 2014



SENIOR FLOATING RATE INTERESTS		Principal			SENIOR FLOATING RATE INTERESTS		Principal
(continued)		Amount (000's) Value (000's)			(continued)		Amount (000's) Value (000's)

Media (continued)					Semiconductors (continued)
iHeartCommunications Inc, Term Loan D-					Avago Technologies Cayman Ltd, Term Loan
EXT					B (continued)
6.90%, 01/22/2019 ^(e)	$	699	$	659		3.75%, 04/16/2021 ^(e)	$	667	$	665
6.90%, 01/23/2019 ^(e)		3,572		3,367	Freescale Semiconductor Inc, Term Loan B4
iHeartCommunications Inc, Term Loan E						4.25%, 02/13/2020 ^(e)		1,420		1,399
7.65%, 07/30/2019 ^(e)		1,767		1,697		4.25%, 02/28/2020 ^(e)		566		558
McGraw-Hill Global Education Holdings					Freescale Semiconductor Inc, Term Loan B5
LLC, Term Loan						5.00%, 01/15/2021 ^(e)		416		415
5.75%, 03/18/2019 ^(e)		378		378				$		6,803
Radio One Inc, Term Loan B
7.50%, 03/25/2016 ^(e)		1,534		1,530	Software - 0.20%
Tribune Media Co, Term Loan B					Ellucian Inc, Term Loan B
						4.00%, 07/19/2018 ^(e)		1,107		1,095
4.00%, 11/20/2020 ^(e)		738		731
TWCC Holding Corp, Term Loan					Evergreen Skills Lux Sarl, Term Loan
						4.00%, 04/08/2021 ^(e)		314		308
3.50%, 02/13/2017 ^(e)		650		640
						4.00%, 04/08/2021 ^(e)		391		384
Univision Communications Inc, Term Loan
C3					First Data Corp, Term Loan B
						3.65%, 03/24/2017 ^(e)		1,246		1,236
4.00%, 03/01/2020 ^(e)		1,213		1,199
4.00%, 03/01/2020 ^(e)		379		375	First Data Corp, Term Loan B1
						3.65%, 09/24/2018 ^(e)		574		569
Univision Communications Inc, Term Loan
C4								$		3,592
4.00%, 03/01/2020 ^(e)		1,004		993	Telecommunications - 0.32%
		$		14,814	Altice Financing SA, Delay-Draw Term Loan
Oil & Gas - 0.21%					DD
						5.50%, 07/15/2019 ^(e)		695		698
Alon USA Partners LP, Term Loan B
9.25%, 11/13/2018 ^(e)		142		144	Cincinnati Bell Inc, Term Loan B
						4.00%, 08/09/2020 ^(e)		147		144
Drillships Ocean Ventures Inc, Term Loan B						4.00%, 08/09/2020 ^(e)		142		140
5.50%, 07/16/2021 ^(e)		511		490
						4.00%, 08/20/2020 ^(e)		147		144
Fieldwood Energy LLC, Term Loan
8.38%, 09/30/2020 ^(e)		1,615		1,551	Integra Telecom Holdings Inc, Term Loan
						5.25%, 02/22/2019 ^(e)		1,010		1,005
MEG Energy Corp, Term Loan B
3.75%, 03/31/2020 ^(e)		581		570	Level 3 Financing Inc, Term Loan BI
						3.95%, 01/15/2020 ^(e)		908		903
Sabine Oil & Gas LLC, Term Loan
8.75%, 01/18/2018 ^(e)		667		630	Level 3 Financing Inc, Term Loan BIII
						3.95%, 08/01/2019 ^(e)		2,500		2,484
Shelf Drilling Midco Ltd, PIK Term Loan B
10.00%, 10/08/2018 ^(e)		460		453	UPC Financing Partnership, Term Loan AH
						3.25%, 06/10/2021 ^(e)		310		303
		$		3,838
								$		5,821
Oil & Gas Services - 0.06%					TOTAL SENIOR FLOATING RATE INTERESTS			$		109,156
Floatel International Ltd, Term Loan B					Total Investments			$		1,766,940
6.00%, 05/22/2020 ^(e)		553		535	Other Assets in Excess of Liabilities, Net - 1.42%			$		25,491
Stallion Oilfield Holdings Inc, Term Loan					TOTAL NET ASSETS - 100.00%			$		1,792,431
8.00%, 06/11/2018 ^(e)		470		449
		$		984

Real Estate - 0.17%					(a)	Non-Income Producing Security
Realogy Group LLC, Term Loan B					(b)	Security is Illiquid
3.75%, 03/05/2020 ^(e)		3,107		3,080	(c)	Fair value of these investments is determined in good faith by the Manager
						under procedures established and periodically reviewed by the Board of
						Directors. At the end of the period, the fair value of these securities totaled
Retail - 0.33%						$11,822 or 0.66% of net assets.
J Crew Group Inc, Term Loan B					(d)	Security exempt from registration under Rule 144A of the Securities Act of
4.00%, 02/26/2021 ^(e)		270		261		1933. These securities may be resold in transactions exempt from
4.00%, 02/26/2021 ^(e)		314		303		registration, normally to qualified institutional buyers. Unless otherwise
4.00%, 02/26/2021 ^(e)		355		343		indicated, these securities are not considered illiquid. At the end of the
4.00%, 02/26/2021 ^(e)		442		427		period, the value of these securities totaled $479,070 or 26.73% of net
JC Penney Corp Inc, Term Loan						assets.
6.00%, 05/21/2018 ^(e)		1,496		1,476	(e)	Variable Rate. Rate shown is in effect at October 31, 2014.
Rite Aid Corp, Term Loan 1					(f)	Payment in kind; the issuer has the option of paying additional securities
5.75%, 08/21/2020 ^(e)		320		322		in lieu of cash.
Rite Aid Corp, Term Loan 2					(g)	Security purchased on a when-issued basis.
4.88%, 06/11/2021 ^(e)		1,889		1,884	(h)	This Senior Floating Rate Note will settle after October 31, 2014, at which
Serta Simmons Holdings LLC, Term Loan B						time the interest rate will be determined.
4.25%, 09/19/2019 ^(e)		353		350
4.25%, 10/01/2019 ^(e)		290		287
4.25%, 10/01/2019 ^(e)		162		160
4.25%, 10/01/2019 ^(e)		27		27
		$		5,840

Semiconductors - 0.38%
Avago Technologies Cayman Ltd, Term Loan
B
3.75%, 04/16/2019 ^(e)		3,780		3,766


Schedule of Investments
Income Fund
October 31, 2014



	COMMON STOCKS - 0.00%		Shares Held				Value(000's)			Principal
								BONDS (continued)		Amount (000's)		Value (000's )
	Computers - 0.00%
	SONICblue Inc ^(a),(b)			9,825,000		$	—	Banks (continued)
								PNC Financial Services Group Inc/The
								6.75%, 07/29/2049 ^(d)	$	18,000	$	19,647
	Diversified Financial Services - 0.00%							SunTrust Bank/Atlanta GA
	Adelphia Recovery Trust ^(a),(b),(c)			658,740			5
								2.75%, 05/01/2023		15,000		14,394
								US Bancorp/MN
	Transportation - 0.00%							1.65%, 05/15/2017		9,000		9,103
	Trailer Bridge Inc ^(a),(b)			7,120			—	2.95%, 07/15/2022		5,000		4,905
								3.00%, 03/15/2022		2,000		2,010
	TOTAL COMMON STOCKS				$		5	3.60%, 09/11/2024		9,500		9,558
	INVESTMENT COMPANIES - 5.30%		Shares Held				Value(000's)	4.13%, 05/24/2021		3,000		3,255
								Wells Fargo & Co
	Publicly Traded Investment Fund - 5.30%							7.98%, 12/31/2049 ^(d)		15,000		16,533
	Goldman Sachs Financial Square Funds -			150,753,514			150,754			$		211,177
	Government Fund
								Beverages - 1.35%
	TOTAL INVESTMENT COMPANIES				$		150,754	Anheuser-Busch InBev Worldwide Inc
				Principal				2.50%, 07/15/2022		9,000		8,612
	BONDS- 61.60	%	Amount (000's)				Value(000's)	7.75%, 01/15/2019		10,000		12,127
								Innovation Ventures LLC / Innovation
	Automobile Floor Plan Asset Backed Securities - 2.68%							Ventures Finance Corp
	Ally Master Owner Trust							9.50%, 08/15/2019 ^(e)		18,000		17,753
	0.60%, 04/15/2018 ^(d)		$	13,000		$	13,019			$		38,492
	0.62%, 01/15/2019 ^(d)			5,000			5,016
	CNH Wholesale Master Note Trust							Biotechnology - 1.18%
	0.75%, 08/15/2019 ^(d),(e)			13,000			13,030	Amgen Inc
	Ford Credit Floorplan Master Owner Trust A							3.63%, 05/15/2022		4,500		4,588
	0.53%, 01/15/2018 ^(d)			14,000			14,015	3.88%, 11/15/2021		13,000		13,612
	0.55%, 02/15/2019 ^(d)			6,000			6,008	Gilead Sciences Inc
	Nissan Master Owner Trust Receivables							4.40%, 12/01/2021		14,000		15,319
	0.45%, 02/15/2018 ^(d)			14,000			14,000			$		33,519
	Volkswagen Credit Auto Master Trust							Chemicals - 1.03%
	0.51%, 07/22/2019 ^(d),(e)			11,000			11,005
								Airgas Inc
					$		76,093	1.65%, 02/15/2018		6,000		5,965
	Automobile Manufacturers - 1.03%							2.38%, 02/15/2020		7,000		6,923
	American Honda Finance Corp							3.65%, 07/15/2024		5,000		5,044
	0.73%, 10/07/2016 ^(d)			4,500			4,531	Axiall Corp
	1.60%, 02/16/2018 ^(e)			10,000			9,997	4.88%, 05/15/2023		2,500		2,425
	3.80%, 09/20/2021 ^(e)			10,000			10,554	Eagle Spinco Inc
	General Motors Co							4.63%, 02/15/2021		9,250		8,973
	4.88%, 10/02/2023			4,000			4,285			$		29,330
					$		29,367	Commercial Services - 0.78%
	Banks- 7.43	%						ERAC USA Finance LLC
	Bank of America Corp							3.30%, 10/15/2022 ^(e)		2,000		1,993
	5.00%, 01/15/2015			3,000			3,026	4.50%, 08/16/2021 ^(e)		6,000		6,529
	5.42%, 03/15/2017			5,000			5,414	6.38%, 10/15/2017 ^(e)		4,000		4,532
	6.50%, 07/15/2018			2,000			2,287	7.00%, 10/15/2037 ^(e)		7,000		9,209
	6.75%, 06/01/2028			2,000			2,512			$		22,263
	8.00%, 12/29/2049 ^(d)			4,000			4,305
	8.13%, 12/29/2049 ^(d)			10,000			10,850	Computers - 0.44%
								Apple Inc
	Citigroup Inc							2.40%, 05/03/2023		13,000		12,542
	3.95%, 06/15/2016			3,000			3,135
	4.50%, 01/14/2022			4,000			4,340
	5.85%, 08/02/2016			12,000			12,953	Credit Card Asset Backed Securities - 0.36%
	Goldman Sachs Group Inc/The							Cabela's Credit Card Master Note Trust
	3.63%, 02/07/2016			5,000			5,160	0.50%, 03/16/2020 ^(d)		10,253		10,248
	3.63%, 01/22/2023			4,000			4,011
	5.25%, 07/27/2021			13,000			14,493	Diversified Financial Services - 2.64%
	5.35%, 01/15/2016			2,000			2,109	DVI Inc
	ING Bank NV							0.00%, 02/01/2004 ^(a),(b),(c)		8,125		—
	3.75%, 03/07/2017 ^(e)			5,000			5,267	0.00%, 02/01/2004 ^(a),(b),(c)		400		—
	4.00%, 03/15/2016 ^(e)			7,000			7,285
								Ford Motor Credit Co LLC
	JP Morgan Chase & Co							3.98%, 06/15/2016		20,000		20,890
	3.25%, 09/23/2022			5,000			5,007	General Electric Capital Corp
	3.63%, 05/13/2024			15,000			15,187	1.23%, 03/15/2023 ^(d)		13,000		13,135
	7.90%, 04/29/2049 ^(d)			7,000			7,586
								5.30%, 02/11/2021		2,000		2,271
	Morgan Stanley							International Lease Finance Corp
	3.80%, 04/29/2016			4,000			4,157	8.63%, 01/15/2022		3,000		3,720
	4.88%, 11/01/2022			2,000			2,130	8.75%, 03/15/2017 ^(d)		8,500		9,563
	5.50%, 07/28/2021			5,000			5,701	Jefferies Finance LLC / JFIN Co-Issuer Corp
	PNC Bank NA							7.38%, 04/01/2020 ^(e)		3,750		3,731
	2.95%, 01/30/2023			5,000			4,857


Schedule of Investments
Income Fund
October 31, 2014



		Principal						Principal
BONDS (continued)		Amount (000's)	Value (000's)		BONDS (continued)			Amount (000's) )	Value (000's

Diversified Financial Services (continued)					Healthcare - Services (continued)
Jefferies Group LLC					HealthSouth Corp
5.13%, 04/13/2018	$	5,000	$	5,419	5.75%, 11/01/2024		$	2,000	$	2,100
5.13%, 01/20/2023		1,500		1,590	7.75%, 09/15/2022			4,948		5,288
6.25%, 01/15/2036		9,000		9,657	Roche Holdings Inc
8.50%, 07/15/2019		4,000		4,962	0.57%, 09/30/2019 ^(d),(e)			13,500		13,493
		$		74,938	Vantage Oncology LLC / Vantage Oncology
					Finance Co
Electric - 6.59%					9.50%, 06/15/2017 ^(e)			18,000		16,650
Exelon Generation Co LLC								$		47,655
6.20%, 10/01/2017		14,000		15,756
6.25%, 10/01/2039		3,000		3,509	Insurance - 2.57%
GenOn Americas Generation LLC					Berkshire Hathaway Inc
8.50%, 10/01/2021		12,500		11,813	3.00%, 02/11/2023			5,000		5,016
GenOn Energy Inc					3.75%, 08/15/2021			5,000		5,332
9.88%, 10/15/2020		6,500		6,744	Fidelity National Financial Inc
LG&E and KU Energy LLC					5.50%, 09/01/2022			5,000		5,436
3.75%, 11/15/2020		5,000		5,231	6.60%, 05/15/2017			12,000		13,344
4.38%, 10/01/2021		5,000		5,429	First American Financial Corp
Metropolitan Edison Co					4.30%, 02/01/2023			20,000		20,234
3.50%, 03/15/2023 ^(e)		9,000		8,948	Prudential Financial Inc
NiSource Finance Corp					4.50%, 11/16/2021			2,000		2,185
3.85%, 02/15/2023		2,000		2,073	5.38%, 06/21/2020			2,000		2,269
5.25%, 09/15/2017		2,000		2,206	7.38%, 06/15/2019			4,000		4,868
6.13%, 03/01/2022		5,000		5,944	8.88%, 06/15/2068 ^(d)			12,000		14,355
Oncor Electric Delivery Co LLC								$		73,039
7.00%, 09/01/2022		17,000		21,560
PacifiCorp					Iron & Steel - 1.45%
5.25%, 06/15/2035		5,000		5,871	Allegheny Technologies Inc
6.25%, 10/15/2037		2,000		2,635	5.88%, 08/15/2023			7,000		7,381
PPL Energy Supply LLC					5.95%, 01/15/2021			16,000		16,809
4.60%, 12/15/2021		11,000		10,370	ArcelorMittal
					6.00%, 03/01/2021 ^(d)			16,000		17,160
6.50%, 05/01/2018		3,000		3,257
Solar Star Funding LLC								$		41,350
5.38%, 06/30/2035 ^(e)		15,500		16,730	Leisure Products & Services - 0.72%
Southwestern Electric Power Co					Royal Caribbean Cruises Ltd
3.55%, 02/15/2022		12,000		12,444	7.25%, 03/15/2018			5,000		5,612
5.38%, 04/15/2015		6,500		6,633	Seven Seas Cruises S de RL LLC
TransAlta Corp					9.13%, 05/15/2019			14,000		14,875
4.50%, 11/15/2022		18,000		18,279				$		20,487
6.65%, 05/15/2018		4,000		4,493
Tucson Electric Power Co					Lodging - 0.63%
3.85%, 03/15/2023		14,000		14,230	Boyd Gaming Corp
5.15%, 11/15/2021		3,000		3,348	9.13%, 12/01/2018			17,000		17,807
		$		187,503

Entertainment - 0.21%					Media- 2.28	%
Greektown Holdings LLC/Greektown					21st Century Fox America Inc
Mothership Corp					4.50%, 02/15/2021			5,000		5,462
8.88%, 03/15/2019 ^(e)		1,250		1,256	6.40%, 12/15/2035			8,000		10,197
Peninsula Gaming LLC / Peninsula Gaming					Comcast Corp
Corp					2.85%, 01/15/2023			10,000		9,877
8.38%, 02/15/2018 ^(e)		4,500		4,748	3.13%, 07/15/2022			2,000		2,036
		$		6,004	5.15%, 03/01/2020			2,000		2,283
					Historic TW Inc
Environmental Control - 1.53%					9.15%, 02/01/2023			5,260		7,154
ADS Waste Holdings Inc					NBCUniversal Enterprise Inc
8.25%, 10/01/2020		21,000		21,998	0.92%, 04/15/2018 ^(d),(e)			3,000		3,028
Republic Services Inc					Time Warner Cable Inc
3.55%, 06/01/2022		6,000		6,152	4.00%, 09/01/2021			2,000		2,118
3.80%, 05/15/2018		2,000		2,126	4.13%, 02/15/2021			2,000		2,140
5.00%, 03/01/2020		12,000		13,371	5.00%, 02/01/2020			2,000		2,238
		$		43,647	6.55%, 05/01/2037			6,000		7,550

Forest Products & Paper - 0.63%					7.30%, 07/01/2038			7,750		10,663
Plum Creek Timberlands LP								$		64,746
3.25%, 03/15/2023		5,000		4,857	Mining - 0.66%
4.70%, 03/15/2021		12,000		12,985	Glencore Canada Corp
		$		17,842	6.00%, 10/15/2015			12,000		12,554
					Glencore Finance Canada Ltd
Healthcare - Services - 1.68%					4.25%, 10/25/2022 ^(d),(e)			2,000		2,022
HCA Inc					4.95%, 11/15/2021 ^(e)			4,000		4,286
5.88%, 05/01/2023		4,500		4,838
7.50%, 02/15/2022		3,000		3,484				$		18,862
7.50%, 11/06/2033		1,700		1,802


Schedule of Investments
Income Fund
October 31, 2014



		Principal						Principal
BONDS (continued)		Amount (000's) )	Value (000's		BONDS (continued)			Amount (000's)	Value (000's)

Oil & Gas - 5.58%					REITS- 8.31	%
BG Energy Capital PLC					Alexandria Real Estate Equities Inc
2.88%, 10/15/2016 ^(e)	$	2,000	$	2,069	3.90%, 06/15/2023		$	4,000	$	4,018
4.00%, 10/15/2021 ^(e)		11,500		12,120	4.60%, 04/01/2022			20,500		21,624
BP Capital Markets PLC					Arden Realty LP
2.50%, 11/06/2022		3,000		2,847	5.25%, 03/01/2015			8,000		8,028
3.25%, 05/06/2022		4,000		4,012	BioMed Realty LP
4.75%, 03/10/2019		14,000		15,436	3.85%, 04/15/2016			6,000		6,238
Linn Energy LLC / Linn Energy Finance					4.25%, 07/15/2022			8,000		8,247
Corp					6.13%, 04/15/2020			8,000		9,148
6.50%, 05/15/2019		13,250		12,389	CubeSmart LP
Nabors Industries Inc					4.38%, 12/15/2023			8,000		8,289
5.00%, 09/15/2020		14,000		15,252	4.80%, 07/15/2022			9,000		9,688
5.10%, 09/15/2023		5,000		5,350	Duke Realty LP
Petro-Canada					3.88%, 10/15/2022			3,000		3,045
9.25%, 10/15/2021		8,500		11,628	4.38%, 06/15/2022			4,000		4,212
Phillips 66					8.25%, 08/15/2019			13,000		16,135
4.30%, 04/01/2022		9,000		9,648	HCP Inc
Rowan Cos Inc					2.63%, 02/01/2020			5,000		4,963
4.88%, 06/01/2022		8,000		8,211	3.75%, 02/01/2019			5,000		5,269
5.00%, 09/01/2017		14,000		15,075	5.38%, 02/01/2021			3,000		3,354
Tesoro Corp					6.00%, 03/01/2015			1,750		1,781
5.38%, 10/01/2022		8,750		9,012	7.07%, 06/08/2015			2,250		2,330
W&T Offshore Inc					Health Care REIT Inc
8.50%, 06/15/2019		22,500		21,938	3.75%, 03/15/2023			3,000		2,985
Whiting Petroleum Corp					4.50%, 01/15/2024			5,000		5,193
5.75%, 03/15/2021		13,000		13,715	4.95%, 01/15/2021			3,000		3,293
		$		158,702	6.13%, 04/15/2020			2,000		2,316
					6.20%, 06/01/2016			3,000		3,244
Oil & Gas Services - 1.60%					Healthcare Realty Trust Inc
Exterran Partners LP / EXLP Finance Corp					5.75%, 01/15/2021			4,000		4,473
6.00%, 04/01/2021		24,000		23,160	6.50%, 01/17/2017			12,500		13,824
Weatherford International Ltd/Bermuda					Hospitality Properties Trust
4.50%, 04/15/2022		6,750		6,940	4.50%, 06/15/2023			5,000		5,092
5.13%, 09/15/2020		14,000		15,267	4.65%, 03/15/2024			5,000		5,103
		$		45,367	5.00%, 08/15/2022			14,000		14,758
Other Asset Backed Securities - 1.41%					Kimco Realty Corp
Drug Royalty II LP 2					6.88%, 10/01/2019			12,000		14,296
3.48%, 07/15/2023 ^(d),(e)		17,112		17,216	Nationwide Health Properties Inc
PFS Financing Corp					6.00%, 05/20/2015			12,000		12,342
0.65%, 04/17/2017 ^(d),(e)		9,000		9,003	Simon Property Group LP
0.70%, 02/15/2018 ^(d),(e)		14,000		13,995	2.75%, 02/01/2023			7,000		6,808
		$		40,214	4.38%, 03/01/2021			3,000		3,291
					10.35%, 04/01/2019			9,000		11,913
Packaging & Containers - 0.22%					Ventas Realty LP / Ventas Capital Corp
Sealed Air Corp					3.25%, 08/15/2022			8,000		7,843
6.88%, 07/15/2033 ^(e)		6,000		6,270	4.00%, 04/30/2019			3,000		3,204
								$		236,347

Pharmaceuticals - 0.47%					Savings & Loans - 0.36%
AbbVie Inc					First Niagara Financial Group Inc
2.90%, 11/06/2022		13,750		13,375	7.25%, 12/15/2021			9,000		10,373


Pipelines - 2.74%					Telecommunications - 1.30%
Buckeye Partners LP					Corning Inc
4.15%, 07/01/2023		10,000		10,049	4.25%, 08/15/2020			10,000		10,946
4.35%, 10/15/2024		7,500		7,463	4.75%, 03/15/2042			4,000		4,156
El Paso Natural Gas Co LLC					Qwest Corp
7.50%, 11/15/2026		9,500		11,993	6.75%, 12/01/2021			19,000		21,856
Express Pipeline LLC								$		36,958
7.39%, 12/31/2019 ^(e)		5,364		5,702
Southeast Supply Header LLC					Transportation - 0.93%
4.25%, 06/15/2024 ^(e)		14,000		14,437	Navios Maritime Holdings Inc / Navios
Southern Natural Gas Co LLC					Maritime Finance II US Inc
8.00%, 03/01/2032		4,000		5,176	7.38%, 01/15/2022 ^(e)			14,000		14,070
Tennessee Gas Pipeline Co LLC					Trailer Bridge Inc
8.38%, 06/15/2032		2,000		2,662	0.00%, 11/15/2015 ^(a),(b)			12,000		—
TransCanada PipeLines Ltd					15.50%, 03/31/2017 ^(b),(c),(d)			12,880		12,327
0.91%, 06/30/2016 ^(d)		5,000		5,030				$		26,397
6.10%, 06/01/2040		5,000		6,052
7.25%, 08/15/2038		7,000		9,415
		$		77,979


Schedule of Investments
Income Fund
October 31, 2014



		Principal				U.S. GOVERNMENT & GOVERNMENT			Principal
BONDS (continued)		Amount (000's)		Value (000's)		AGENCY OBLIGATIONS (continued)			Amount (000's)	Value (000's)

Trucking & Leasing - 0.81%						Federal National Mortgage Association (FNMA) (continued)
Penske Truck Leasing Co Lp / PTL Finance						3.00%, 03/01/2042		$	11,693	$	11,730
Corp						3.00%, 05/01/2042			13,334		13,374
3.75%, 05/11/2017 ^(e)		$	22,000	$	23,110	3.00%, 06/01/2042			12,606		12,642
						3.00%, 06/01/2042			12,576		12,612
TOTAL BONDS			$		1,752,003	3.50%, 12/01/2040			9,366		9,701
		Principal				3.50%, 01/01/2041			8,096		8,390
CONVERTIBLE BONDS - 1.29%		Amount (000's)		Value (000's)		3.50%, 01/01/2041			7,608		7,882
						3.50%, 12/01/2041			6,989		7,245
Automobile Parts & Equipment - 0.97%						3.50%, 01/01/2042			10,080		10,458
Meritor Inc						3.50%, 03/01/2042			11,118		11,525
7.88%, 03/01/2026			18,750		27,516	3.50%, 04/01/2042			14,261		14,783
						3.50%, 02/01/2043			17,432		18,086
Pharmaceuticals - 0.32%						3.50%, 06/01/2043			16,641		17,265
Omnicare Inc						4.00%, 03/01/2039			5,563		5,913
3.25%, 12/15/2035			3,720		3,943	4.00%, 08/01/2040			5,554		5,909
3.50%, 02/15/2044			4,622		5,249	4.00%, 09/01/2040			10,208		10,903
			$		9,192	4.00%, 11/01/2040			6,769		7,198
TOTAL CONVERTIBLE BONDS			$		36,708	4.00%, 11/01/2040			4,038		4,295
SENIOR FLOATING RATE INTERESTS - Principal						4.00%, 10/01/2041			6,808		7,237
0.59	%	Amount (000's)		Value (000's)		4.00%, 10/01/2041			8,917		9,478
						4.00%, 11/01/2041			20,481		21,770
Oil & Gas - 0.22%						4.00%, 04/01/2042			12,052		12,810
Drillships Ocean Ventures Inc, Term Loan B						4.00%, 08/01/2043			18,511		19,772
5.50%, 07/16/2021 ^(d)		$	6,484	$	6,211	4.00%, 11/01/2043			18,515		19,838
						4.00%, 11/01/2043			16,910		18,030
Transportation - 0.37%						4.00%, 01/01/2044			17,295		18,441
Trailer Bridge Inc, Term Loan						4.00%, 02/01/2044			18,337		19,586
10.00%, 04/02/2016 ^(b),(c),(d)			10,650		10,650	4.50%, 06/01/2039			3,295		3,581
						4.50%, 08/01/2039			3,998		4,395
TOTAL SENIOR FLOATING RATE INTERESTS			$		16,861	4.50%, 05/01/2040			5,458		5,961
						4.50%, 10/01/2040			13,438		14,668
U.S. GOVERNMENT & GOVERNMENT		Principal				4.50%, 12/01/2040			13,704		14,968
AGENCY OBLIGATIONS - 30.92%		Amount (000's)		Value (000's)		5.00%, 01/01/2018			354		374
Federal Home Loan Mortgage Corporation (FHLMC) -						5.00%, 10/01/2032			506		561
5.92	%					5.00%, 08/01/2035			3,722		4,120
3.00%, 10/01/2042		$	14,451	$	14,499	5.00%, 04/01/2039			1,901		2,123
3.00%, 10/01/2042			15,245		15,296	5.00%, 12/01/2039			2,806		3,110
3.00%, 11/01/2042			14,896		14,944	5.00%, 04/01/2040			5,530		6,129
3.50%, 10/01/2041			9,007		9,317	5.00%, 06/01/2040			4,854		5,423
3.50%, 04/01/2042			11,708		12,114	5.50%, 03/01/2033			446		500
3.50%, 04/01/2042			11,189		11,575	5.50%, 02/01/2035			3,901		4,385
4.00%, 04/01/2039			7,177		7,702	6.00%, 04/01/2032			142		162
4.50%, 08/01/2033			1,073		1,166	6.50%, 09/01/2028			53		60
4.50%, 08/01/2033			2,348		2,549	6.50%, 11/01/2028			53		60
4.50%, 08/01/2033			2,003		2,174	6.50%, 05/01/2031			27		30
4.50%, 05/01/2039			5,371		5,819	6.50%, 05/01/2032			274		318
4.50%, 06/01/2039			4,345		4,775	7.00%, 01/01/2030			5		5
4.50%, 07/01/2039			10,912		11,947
4.50%, 12/01/2040			11,079		12,007				$		419,509
4.50%, 10/01/2041			15,592		16,907	Government National Mortgage Association (GNMA) -
5.00%, 08/01/2035			1,836		1,982	0.03	%
						6.00%, 05/20/2032 ^(d)			542		624
5.00%, 11/01/2035			1,976		2,191
5.00%, 10/01/2038			3,394		3,698	7.00%, 06/20/2031			108		129
5.00%, 08/01/2039			7,527		8,377				$		753
5.50%, 11/01/2017			416		440	U.S. Treasury - 10.22%
5.50%, 01/01/2018			96		101	0.25%, 01/31/2015			15,000		15,006
5.50%, 05/01/2031			374		417	0.25%, 07/15/2015			15,000		15,013
5.50%, 06/01/2035			1,333		1,492	0.63%, 12/15/2016			15,000		15,016
5.50%, 01/01/2036			2,203		2,464	0.75%, 10/31/2017			15,000		14,902
5.50%, 04/01/2036			1,993		2,235	0.88%, 02/28/2017			15,000		15,075
6.00%, 03/01/2031			83		94	1.25%, 10/31/2019			15,000		14,728
6.00%, 05/01/2032			324		370	1.38%, 11/30/2018			15,000		14,992
6.00%, 06/01/2038			942		1,068	1.63%, 04/30/2019			15,000		15,067
6.50%, 01/01/2029			86		99	1.63%, 07/31/2019			15,000		15,036
6.50%, 05/01/2029			133		151	1.63%, 11/15/2022			15,000		14,396
6.50%, 06/01/2029			147		166	1.75%, 05/31/2016			15,000		15,327
6.50%, 06/01/2029			71		84	1.75%, 05/15/2022			15,000		14,623
6.50%, 08/01/2029			75		85	2.00%, 11/15/2021			15,000		14,959
7.00%, 01/01/2032			125		143	2.38%, 05/31/2018			15,000		15,602
			$		168,448	3.13%, 05/15/2021			15,000		16,049
Federal National Mortgage Association (FNMA) - 14.75%						3.13%, 08/15/2044			15,000		15,185
3.00%, 03/01/2042			11,667		11,703	3.38%, 05/15/2044			15,000		15,913
						3.63%, 02/15/2044			15,000		16,647


Schedule of Investments
Inflation Protection Fund
October 31, 2014



	INVESTMENT COMPANIES - 0.26%			Shares Held	Value (000's)			Principal
							BONDS (continued)	Amount (000's)		Value (000's)
	Publicly Traded Investment Fund - 0.26%
	Goldman Sachs Financial Square Funds -			2,717,485	$	2,717	Other Asset Backed Securities - 0.04%
	Money Market Fund						Argent Securities Trust 2006-W3
							0.27%, 04/25/2036 ^(b)	$	33	$	14
	TOTAL INVESTMENT COMPANIES			$		2,717	Asset-Backed Pass-Through Certificates

	BONDS- 6.57%	Amount Principal (000's) Value (000's)					Series 0.77%, 2004-R2 04/25/2034 ^(b)		193		190
							Countrywide Asset-Backed Certificates
	Banks- 0.01	%					1.28%, 12/25/2032 ^(b)		45		41
	HSBC USA Capital Trust I						Fannie Mae Grantor Trust 2004-T9
	7.81%, 12/15/2026 ^(a)		$	100	$	102	0.46%, 04/25/2035 ^(b)		25		25
							Fannie Mae REMIC Trust 2003-W16
							0.45%, 11/25/2033 ^(b)		2		2
	Home Equity Asset Backed Securities - 0.00%
	New Century Home Equity Loan Trust 2005-						Long Beach Mortgage Loan Trust 2004-2
							0.95%, 06/25/2034 ^(b)		122		117
	1
	0.73%, 03/25/2035 ^(b)			55		55			$		389
	Option One Mortgage Loan Trust 2005-1						Sovereign - 5.92%
	1.65%, 02/25/2035 ^(b)			23		1
							Bundesrepublik Deutschland Bundesobligation
	Option One Mortgage Loan Trust 2007-CP1						Inflation Linked Bond
	0.60%, 03/25/2037 ^(b)			60		—
							0.75%, 04/15/2018	EUR	3,296		4,311
				$		56	Deutsche Bundesrepublik Inflation Linked
	Mortgage Backed Securities - 0.60%						Bond
	Alternative Loan Trust 2007-OA7						1.50%, 04/15/2016		19,069		24,476
	0.36%, 05/25/2047 ^(b)			1,745		746	Italy Buoni Poliennali Del Tesoro
	Bear Stearns ALT-A Trust 2007-2						2.10%, 09/15/2016		3,891		5,055
	0.32%, 04/25/2037 ^(b)			586		418	2.35%, 09/15/2024 ^(a)		12,826		17,626
	CD 2007-CD4 Commercial Mortgage Trust						2.60%, 09/15/2023		945		1,329
	0.37%, 12/11/2049 ^(a),(b)			5,568		40	New Zealand Government Bond
							3.06%, 09/20/2030 ^(b)	NZD	7,733		6,474
	Chase Mortgage Finance Trust Series 2007-
	A2						United Kingdom Gilt Inflation Linked
	2.59%, 07/25/2037 ^(b)			132		131	0.13%, 03/22/2044	GBP	2,083		3,841
	Commercial Mortgage Trust 2007-GG9								$		63,112
	0.27%, 03/10/2039 ^(a),(b)			42,210		249	TOTAL BONDS		$		69,994
	Fannie Mae REMIC Trust 2004-W5						U.S. GOVERNMENT & GOVERNMENT	Principal
	0.60%, 02/25/2047 ^(b)			42		42	AGENCY OBLIGATIONS - 93.03%	Amount (000's)		Value (000's)
	Fannie Mae REMIC Trust 2005-W2						U.S. Treasury - 2.09%
	0.35%, 05/25/2035 ^(b)			33		33
							1.63%, 07/31/2019	$	15,000	$	15,036
	Freddie Mac REMICS						3.13%, 08/15/2044		7,175		7,264
	0.55%, 09/15/2033 ^(b)			45		46
	0.60%, 06/15/2023 ^(b)			5		5			$		22,300
	G-FORCE 2005-RR2 LLC						U.S. Treasury Inflation-Indexed Obligations - 90.94%
	0.45%, 12/25/2039 ^(a),(b)			629		610	0.13%, 04/15/2016		44,399		44,895
	Ginnie Mae						0.13%, 04/15/2017		43,848		44,533
	0.51%, 10/20/2031 ^(b)			10		10	0.13%, 04/15/2018		62,997		63,775
	0.70%, 03/16/2047 ^(b)			1,411		49	0.13%, 04/15/2019		54,545		54,928
	HomeBanc Mortgage Trust 2005-5						0.13%, 01/15/2022		60,518		59,672
	0.49%, 01/25/2036 ^(b)			545		471	0.13%, 07/15/2022		15,199		14,987
	Impac CMB Trust Series 2004-5						0.13%, 01/15/2023		50,061		49,001
	2.48%, 10/25/2034 ^(b)			38		28	0.13%, 07/15/2024		14,224		13,833
	Impac CMB Trust Series 2004-6						0.38%, 07/15/2023		18,341		18,345
	1.13%, 10/25/2034 ^(b)			23		22	0.63%, 07/15/2021		207		213
	Impac CMB Trust Series 2005-1						0.63%, 01/15/2024		114,852		116,718
	0.77%, 04/25/2035 ^(b)			163		138	0.63%, 02/15/2043		24,384		22,273
	Impac CMB Trust Series 2005-5						0.75%, 02/15/2042		22,607		21,378
	0.92%, 08/25/2035 ^(b)			33		18	1.13%, 01/15/2021		65,255		68,920
	Impac CMB Trust Series 2007-A						1.25%, 07/15/2020		15,596		16,653
	0.40%, 05/25/2037 ^(b)			706		690	1.38%, 07/15/2018		6,177		6,583
	JP Morgan Alternative Loan Trust 2007-A1						1.38%, 01/15/2020		23,020		24,592
	0.30%, 03/25/2037 ^(b)			806		741	1.38%, 02/15/2044		47,784		52,690
	Merrill Lynch Alternative Note Asset Trust						1.75%, 01/15/2028		24,325		27,632
	Series 2007-A3						2.00%, 01/15/2026 ^(c)		9,401		10,864
	0.36%, 04/25/2037 ^(b)			2,844		1,605	2.13%, 02/15/2040		14,393		18,286
	ML-CFC Commercial Mortgage Trust 2006-						2.13%, 02/15/2041		12,565		16,066
	3						2.38%, 01/15/2025		64,047		75,951
	0.70%, 07/12/2046 ^(a),(b)			12,688		148	2.38%, 01/15/2027		15,840		19,078
	WaMu Mortgage Pass-Through Certificates						2.50%, 07/15/2016		17,368		18,402
	Series 2005-AR2 Trust						2.50%, 01/15/2029		38,115		47,427
	0.52%, 01/25/2045 ^(b)			90		82	3.38%, 04/15/2032		2,339		3,320
	WaMu Mortgage Pass-Through Certificates						3.63%, 04/15/2028		794		1,097
	Series 2006-AR9 Trust						3.88%, 04/15/2029 ^(c)		25,356		36,425
	0.37%, 08/25/2046 ^(b)			88		13			$		968,537
				$		6,335	TOTAL U.S. GOVERNMENT & GOVERNMENT AGENCY
							OBLIGATIONS		$		990,837


Schedule of Investments
Inflation Protection Fund
October 31, 2014



		Principal
		Amount (000's) Value (000's)
TOTAL PURCHASED CAPPED OPTIONS - 0.00%			$		4
TOTAL PURCHASED OPTIONS - 0.10%			$		994
Total Investments			$	1,064,546
Other Assets in Excess of Liabilities, Net - 0.04%			$		454
TOTAL NET ASSETS - 100.00%			$	1,065,000


(a)	Security exempt from registration under Rule 144A of the Securities Act of
	1933. These securities may be resold in transactions exempt from
	registration, normally to qualified institutional buyers. Unless otherwise
	indicated, these securities are not considered illiquid. At the end of the
	period, the value of these securities totaled $18,774 or 1.77% of net assets.
(b)	Variable Rate. Rate shown is in effect at October 31, 2014.
(c)	Security or a portion of the security was pledged to cover margin
	requirements for futures contracts. At the end of the period, the value of
	these securities totaled $2,166 or 0.20% of net assets.


	Portfolio Summary (unaudited)
Sector					Percent
Government					98.95	%
Mortgage Securities					0.60	%
Exchange Traded Funds					0.26	%
Purchased Options					0.10	%
Asset Backed Securities					0.04	%
Financial					0.01	%
Purchased Capped Options					0.00	%
Other Assets in Excess of Liabilities, Net					0.04	%
TOTAL NET ASSETS					100.00	%

Foreign Currency Contracts

											Unrealized Appreciation/(Depreciation)
Counterparty		Delivery Date	Contracts to Accept				In Exchange For			Fair Value		Asset		Liability
Citigroup Inc		12/15/2014	EUR		4,130,000		$	5,265	$	5,175	$	— $		(90	)
Total											$	— $		(90	)
											Unrealized Appreciation/(Depreciation)
Counterparty		Delivery Date	Contracts to Deliver				In Exchange For			Fair Value		Asset		Liability
Barclays Bank PLC		11/06/2014	EUR		9,237,700		$	11,720	$	11,576	$	144	$	—
Barclays Bank PLC		11/06/2014	GBP		2,373,000			3,838		3,796		42		—
Barclays Bank PLC		12/04/2014	EUR		42,361,000			53,180		53,088		92		—
Barclays Bank PLC		12/15/2014	EUR		15,947,000			20,297		19,986		329		(18	)
BNP Paribas		11/06/2014	EUR		31,694,000			39,918		39,717		201		—
BNP Paribas		12/15/2014	JPY		599,482,372			5,345		5,340		5		—
Deutsche Bank AG		12/15/2014	EUR		2,110,000			2,694		2,645		49		—
JP Morgan Chase		11/06/2014	EUR		1,429,000			1,805		1,791		14		—
JP Morgan Chase		01/21/2015	NZD		7,633,000			5,992		5,902		90		—
UBS AG		12/04/2014	GBP		2,373,000			3,797		3,795		2		—
Total											$	968	$	(18	)

Amounts in thousands except contracts

Futures Contracts

														Unrealized
Type		Long/Short			Contracts			Notional Value				Fair Value	Appreciation/(Depreciation)
90 Day Eurodollar; December 2014			Long		900		$	224,431		$		224,460	$	29
90 Day Eurodollar; December 2015			Long		427			105,852				105,859		7
90 Day Eurodollar; December 2017			Short		185			45,068				45,073		(5	)
90 Day Eurodollar; June 2015			Short		433			107,728				107,828		(100	)
Euro Bund 10 Year Bund Future; December 2014			Short		42			7,931				7,943		(12	)
Euro-BTP; December 2014			Short		17			2,755				2,776		(21	)
Japan 10 Year Bond TSE; December 2014			Short		31			40,228				40,440		(212	)
US 10 Year Note; December 2014			Long		731			92,785				92,369		(416	)
US 2 Year Note; December 2014			Long		188			41,157				41,278		121
US 5 Year Note; December 2014			Long		354			42,265				42,278		13
US Long Bond; December 2014			Short		27			3,825				3,810		15
US Ultra Bond; December 2014			Short		475			73,449				74,486		(1,037	)
Total												$		(1,618	)

Amounts in thousands except contracts


Schedule of Investments
Inflation Protection Fund
October 31, 2014



Interest Rate Swaps

				(Pay)/ Receive Floating Rate											Upfront
							Fixed			Expiration		Notional			Premiums					Unrealized						Fair Value
	Counterparty (Issuer)	Floating Rate Index					Rate			Date		Amount			Paid/(Received)				Appreciation/(Depreciation)							Asset		Liability
	Barclays Bank PLC	US CPI Urban		Receive			2.07	%	03/10/2018		$	20,405	$		—		$					30		$		30	$	—
		Consumers
		NAS(CPURNSA)
	Barclays Bank PLC	US CPI Urban		Pay			1.85	%	03/10/2016			20,405			—							(106	)			—		(106	)
		Consumers
		NAS(CPURNSA)
	Total											$			—		$					(76	)	$		30	$	(106	)

	Amounts in thousands

Exchange Cleared Interest Rate Swaps

				(Pay)/ Receive Floating Rate

							Fixed			Expiration		Notional
		Floating Rate Index					Rate		Date			Amount		Fair Value					Unrealized Appreciation/(Depreciation)
		3 Month LIBOR		Receive			0.48	%	08/08/2015		$	49,700	$		(84	)											$	(84	)
		3 Month LIBOR		Receive			2.22	%	08/09/2020			21,200			(342	)												(343	)
		3 Month LIBOR		Receive			2.62	%	07/02/2024			13,300			(204	)												(204	)
		6 Month GBP		Receive			2.83	%	08/29/2044		GBP 3,205				(81	)												(81	)
		LIBOR
	Total											$			(711	)											$	(712	)

	Amounts in thousands


Interest Rate Swaptions


							Pay/Receive											Upfront Premiums Paid/(Received)
	Written Swaptions				Floating Rate Index		Floating			Exercise Rate		Expiration			Notional Amount									Fair		Unrealized
	Outstanding	Counterparty (Issuer)			Floating Rate Index		Rate			Exercise Rate		Date			Notional Amount									Value	Appreciation/(Depreciation)
	Put - 10 Year Interest	Barclays Bank PLC			3 Month		Pay			3.20%		07/01/2015		$	33,300			$	(612		) $	(277			) $			335
	Rate Swap				LIBOR
	Total																$		(612		) $	(277			) $			335

	Amounts in thousands


Options

														Upfront Premiums												Unrealized
	Purchased Options Outstanding			Exercise Price				Expiration Date				Contracts			Paid/(Received)				Fair Value					Appreciation/(Depreciation)
	Call - EUR versus USD		EUR			1.28	11/07/2014					18,635,000		$			64		$			2		$				(62	)
	Put- Euro-Bobl Future; December 2014		$			98.75	12/15/2014					1,508					245					19						(226	)
	Put- Euro-Bobl Future; December 2014		$			99.13	12/15/2014					524					86					85						(1	)
	Put- Euro-Bund Future; December 2014		EUR		149.50		11/24/2014					170					86					34						(52	)
	Put - Eurodollar 3 Year Midcurve Future; $					97.50	12/15/2014					778					254			316								62
	December 2014
	Put - US 10 Year Note Future; December $				126.00		11/24/2014					400					124			169								45
	2014
	Put - US 10 Year Note Future; December $				123.50		11/24/2014					336					103					11						(92	)
	2014
	Put - US 5 Year Note Future; December		$		120.50		11/24/2014					319					152			358								206
	2014
	Total													$			1,114		$	994				$				(120	)

														Upfront Premiums												Unrealized
	Written Options Outstanding			Exercise Price				Expiration Date				Contracts			Paid/(Received)				Fair Value					Appreciation/(Depreciation)
	Call- Euro-Bobl Future; December 2014 $					99.00	12/15/2014					1,080		$			(161	)	$	(520			)	$				(359	)
	Call - US 5 Year Note Future; December		$		121.50		11/24/2014					319					(199	)				(3	)					196
	2014
	Put - Eurodollar 3 Year Midcurve Future; $					97.13	12/15/2014					778					(57	)				(68	)					(11	)
	December 2014
	Total													$			(417	)	$	(591			)	$				(174	)

	Amounts in thousands except contracts


Schedule of Investments
International Emerging Markets Fund
October 31, 2014



COMMON STOCKS - 94.10%	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Advertising - 0.25%				Distribution & Wholesale - 0.02%
Multiplus SA	372,200	$	5,220	Hyundai Corp	14,711	$	504


Agriculture - 1.01%				Diversified Financial Services - 4.95%
KT&G Corp	234,518		20,765	Fubon Financial Holding Co Ltd	12,504,000		21,168
				Hana Financial Group Inc	392,095		13,578
				Mega Financial Holding Co Ltd	30,377,691		25,195
Apparel - 0.09%				Shinhan Financial Group Co Ltd	656,470		30,897
Feng TAY Enterprise Co Ltd	680,160		1,758	SinoPac Financial Holdings Co Ltd	1,838,782		799
				Taishin Financial Holding Co Ltd	20,852,284		9,947
Automobile Manufacturers - 3.80%				Woori Finance Holdings Co Ltd ^(a),(b)	41,105		458
Dongfeng Motor Group Co Ltd	312,000		482		$		102,042
Hyundai Motor Co	98,210		15,584	Electric - 4.54%
Kia Motors Corp	316,270		15,362
Maruti Suzuki India Ltd ^(a)	251,141		13,751	China Resources Power Holdings Co Ltd	3,780,000		11,002
				Huadian Fuxin Energy Corp Ltd	18,198,000		10,470
Tata Motors Ltd ADR	701,965		33,063	Huadian Power International Corp Ltd	22,291,631		17,027
	$		78,242	Huaneng Power International Inc	5,904,000		7,259
Automobile Parts & Equipment - 0.72%				Korea Electric Power Corp	589,393		25,872
Apollo Tyres Ltd	2,552,419		9,094	Tenaga Nasional BHD	5,380,000		21,858
Hiroca Holdings Ltd	833,081		2,599		$		93,488
Nexen Tire Corp	214,305		2,625	Electrical Components & Equipment - 0.19%
Seoyeon Co Ltd	41,777		597	LG Innotek Co Ltd ^(b)	49,702		3,919
	$		14,915

Banks - 15.57%				Electronics - 1.94%
Abu Dhabi Commercial Bank PJSC	4,432,922		9,489	Coretronic Corp ^(b)	2,112,750		3,180
Agricultural Bank of China Ltd	36,957,000		17,174	Hon Hai Precision Industry Co Ltd	8,349,684		26,427
Axis Bank Ltd ^(a)	3,585,379		26,049
				Hu Lane Associate Inc	1,637,000		5,730
Banco de Chile	87,423,324		10,700	Merry Electronics Co Ltd	1,119,382		4,527
Bangkok Bank PCL	3,286,400		20,381		$		39,864
Bank Negara Indonesia Persero Tbk PT	24,758,800		12,203
Bank of China Ltd	72,081,113		34,502	Engineering & Construction - 1.77%
Barclays Africa Group Ltd	510,135		8,062	China Railway Construction Corp Ltd	6,480,500		6,808
BDO Unibank Inc	3,513,880		7,670	Grupo Aeroportuario del Sureste SAB de CV	905,346		12,206
China Construction Bank Corp	49,952,722		37,270	Promotora y Operadora de Infraestructura	811,908		11,199
Credicorp Ltd	74,169		11,941	SAB de CV ^(b)
FirstRand Ltd	6,262,091		26,823	Voltas Ltd	1,532,690		6,268
Grupo Financiero Inbursa SAB de CV	4,072,700		12,288		$		36,481
ICICI Bank Ltd ADR	398,453		22,457
Industrial & Commercial Bank of China Ltd	32,800,000		21,778	Environmental Control - 0.45%
Industrial Bank of Korea	1,009,668		14,765	Coway Co Ltd	120,333		9,199
Malayan Banking Bhd	5,271,200		15,551
National Bank of Greece SA ^(b)	369,987		892	Food - 4.84%
Turkiye Is Bankasi	4,219,049		10,549	China Modern Dairy Holdings Ltd ^(b)	13,700,000		6,044
	$		320,544	Daesang Corp	199,887		7,764
				GFPT PCL ^(a)	7,849,800		4,656
Beverages - 0.89%				Gruma SAB de CV ^(b)	1,437,000		15,786
AMBEV SA ADR	1,629,173		10,883	Indofood Sukses Makmur Tbk PT	18,386,600		10,385
Thai Beverage PCL	12,651,000		7,533	JBS SA	3,144,629		14,023
	$		18,416	Magnit PJSC	172,894		11,605
Chemicals - 0.73%				Thai Union Frozen Products PCL ^(a)	3,658,200		8,367
LG Hausys Ltd	32,929		4,913	Universal Robina Corp	2,575,910		10,670
PTT Global Chemical PCL ^(a)	46		—	X5 Retail Group NV ^(b)	565,942		10,373
UPL Ltd	1,783,723		10,098		$		99,673
	$		15,011	Gas - 0.35%
Commercial Services - 2.75%				Petronas Gas Bhd	1,041,100		7,139
Cielo SA	814,300		13,372
Kroton Educacional SA	3,754,588		26,759	Holding Companies - Diversified - 0.00%
OHL Mexico SAB de CV ^(b)	3,689,300		10,353
TAL Education Group ADR ^(b)	193,206		6,136	KOC Holding AS	1		—
	$		56,620
				Home Furnishings - 0.54%
Computers - 1.44%				Steinhoff International Holdings Ltd	2,188,144		11,195
Lenovo Group Ltd	4,298,000		6,335
Wipro Ltd	1,362,034		12,583
Wistron Corp	10,161,000		10,675	Insurance - 4.68%
	$		29,593	BB Seguridade Participacoes SA	1,275,680		17,020
				Cathay Financial Holding Co Ltd	8,893,511		14,660
Cosmetics & Personal Care - 0.64%				PICC Property & Casualty Co Ltd	4,694,000		8,611
Amorepacific Corp	6,124		13,150	Porto Seguro SA	500,573		6,000
				Powszechny Zaklad Ubezpieczen SA	148,455		22,274
				Sanlam Ltd	4,395,499		27,775
					$		96,340


Schedule of Investments
International Emerging Markets Fund
October 31, 2014



COMMON STOCKS (continued)	Shares Held		Value (000's)	COMMON STOCKS (continued)		Shares Held	Value(000			's)

Internet - 2.85%				Software (continued)
Alibaba Group Holding Ltd ADR^(b)	89,363	$	8,811	Tech Mahindra Ltd		377,472		$	15,474
Tencent Holdings Ltd	3,099,600		49,818				$		32,629

	$		58,629	Telecommunications - 9.04%
Iron & Steel - 0.93%				America Movil SAB de CV ADR		659,887			16,108
POSCO	66,269		19,141	Bharti Infratel Ltd		1,808,815			8,669
				BYD Electronic International Co Ltd		4,174,000			4,966
				China Mobile Ltd		3,584,093			44,595
Media - 1.12%				China Telecom Corp Ltd		25,580,000			16,306
Naspers Ltd	184,519		23,015	DiGi.Com Bhd		6,219,300			11,708
				Hellenic Telecommunications Organization		566,913			6,403
Metal Fabrication & Hardware - 1.28%				SA ^(b)
Bharat Forge Ltd	591,172		7,818	MTN Group Ltd		1,438,111			31,844
Catcher Technology Co Ltd	794,000		6,703	SK Telecom Co Ltd		66,003			16,540
Hyosung Corp	199,848		11,866	Telekom Malaysia Bhd		8,301,100			18,175
	$		26,387	Telekomunikasi Indonesia Persero Tbk PT		47,482,700			10,814

Mining - 2.31%							$		186,128
Anglo American PLC	306,660		6,475	Transportation - 0.52%
Grupo Mexico SAB de CV	4,691,100		16,146	Sinotrans Ltd		13,526,000			10,733
KGHM Polska Miedz SA	250,485		9,661
MMC Norilsk Nickel OJSC ADR	818,334		15,269	TOTAL COMMON STOCKS			$		1,937,919
	$		47,551	INVESTMENT COMPANIES - 1.54%		Shares Held	Value(000			's)

Miscellaneous Manufacturing - 0.61%				Publicly Traded Investment Fund - 1.54%
Largan Precision Co Ltd	180,000		12,645	Goldman Sachs Financial Square Funds -		31,630,973			31,631
				Government Fund
Oil & Gas - 6.48%
China Petroleum & Chemical Corp	13,277,978		11,515	TOTAL INVESTMENT COMPANIES			$		31,631
CNOOC Ltd	8,157,000		12,773	PREFERRED STOCKS - 4.80%		Shares Held	Value(000			's)
Gazprom OAO ADR	1,315,337		8,715	Banks - 2.85%
Hindustan Petroleum Corp Ltd	811,204		6,928	Banco Bradesco SA		1,318,700			19,861
Lukoil OAO ADR	432,428		21,197	Itau Unibanco Holding SA		2,626,383			38,952
PetroChina Co Ltd	18,716,000		23,432				$		58,813
Petroleo Brasileiro SA ADR	1,174,950		13,747
PTT Exploration & Production PCL ^(a)	1,738,500		7,816	Electric - 0.10%
Sasol Ltd	397,793		19,864	Cia Energetica de Sao Paulo		207,205			2,043
Tatneft OAO ADR	208,714		7,460
	$		133,447	Food - 0.48%
Pharmaceuticals - 1.76%				Cia Brasileira de Distribuicao		235,100			9,858
Aurobindo Pharma Ltd	855,210		13,488
Lupin Ltd ^(a)	581,243		13,462	Investment Companies - 0.26%
Sinopharm Group Co Ltd	2,394,800		9,356	Bradespar SA		801,500			5,415
	$		36,306

Real Estate - 0.63%				Media - 0.04%
Emlak Konut Gayrimenkul Yatirim Ortakligi	6,236,540		7,005	Zee Entertainment Enterprises Ltd		53,971,932			747
AS
Shimao Property Holdings Ltd	2,735,000		5,886
	$		12,891	Oil & Gas - 0.75%
				Petroleo Brasileiro SA		1,049,400			6,471
REITS - 1.30%				Surgutneftegas OAO		12,975,400			8,891
Fibra Uno Administracion SA de CV	4,007,500		13,910				$		15,362
Mexico Real Estate Management SA de CV ^(b)	7,112,000		12,960
	$		26,870	Telecommunications - 0.32%
				Telefonica Brasil SA		326,000			6,658
Retail - 1.03%
ANTA Sports Products Ltd	6,482,000		12,723	TOTAL PREFERRED STOCKS			$		98,896
GOME Electrical Appliances Holding Ltd	53,485,000		8,426	Total Investments			$		2,068,446
	$		21,149	Liabilities in Excess of Other Assets, Net - (0.44)%			$		(9,090	)
Semiconductors - 10.50%				TOTAL NET ASSETS - 100.00%			$		2,059,356
Advanced Semiconductor Engineering Inc	8,054,000		9,716
Everlight Electronics Co Ltd	4,835,000		9,174
Inotera Memories Inc ^(b)	7,510,000		11,607	(a)	Fair value of these investments is determined in good faith by the Manager
					under procedures established and periodically reviewed by the Board of
Realtek Semiconductor Corp	1,860,000		6,165		Directors. At the end of the period, the fair value of these securities totaled
Samsung Electronics Co Ltd	52,268		60,952		$74,559 or 3.62% of net assets.
Siliconware Precision Industries Co	7,510,000		10,713
SK Hynix Inc ^(b)	786,815		35,088	(b)	Non-Income Producing Security
Taiwan Semiconductor Manufacturing Co Ltd	15,037,685		65,186
Vanguard International Semiconductor Corp	5,138,000		7,719
	$		216,320

Software - 1.58%
HCL Technologies Ltd	654,059		17,155


Schedule of Investments
International Fund I
October 31, 2014



COMMON STOCKS - 91.04%	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Aerospace & Defense - 0.59%				Electric (continued)
Zodiac Aerospace	72,673	$	2,218	PGE SA	327,165	$	2,147
					$		10,085

Automobile Manufacturers - 4.46%				Electrical Components & Equipment - 1.17%
Bayerische Motoren Werke AG	45,971		4,930	Brother Industries Ltd	125,000		2,225
Fuji Heavy Industries Ltd	172,200		5,731	LG Electronics Inc	35,200		2,150
Tata Motors Ltd ADR	126,600		5,963		$		4,375

	$		16,624	Electronics - 3.13%
Automobile Parts & Equipment - 6.20%				AAC Technologies Holdings Inc	395,300		2,372
Bridgestone Corp	140,200		4,685	Fujitsu General Ltd	128,700		1,611
Continental AG	23,760		4,680	Hon Hai Precision Industry Co Ltd	1,726,120		5,463
Halla Visteon Climate Control Corp	36,210		1,614	Japan Aviation Electronics Industry Ltd	112,000		2,219
Koito Manufacturing Co Ltd	101,800		3,067		$		11,665
Linamar Corp	28,300		1,446
Magna International Inc	50,900		5,024	Engineering & Construction - 1.30%
NOK Corp	101,800		2,579	COMSYS Holdings Corp	190,200		3,395
	$		23,095	Kyowa Exeo Corp	117,900		1,444
					$		4,839
Banks - 9.42%
Banco do Brasil SA	124,100		1,389	Food - 1.20%
				Aryzta AG ^(b)	27,800		2,371
Bank of China Ltd	10,232,600		4,898
China CITIC Bank Corp Ltd	5,494,500		3,579	Marine Harvest ASA	147,832		2,094
China Merchants Bank Co Ltd	2,618,100		4,852		$		4,465
China Minsheng Banking Corp Ltd	1,669,200		1,675	Forest Products & Paper - 0.99%
DNB ASA	253,176		4,651	Mondi PLC	217,621		3,678
Fukuoka Financial Group Inc	549,900		2,814
Home Capital Group Inc	38,000		1,821
Siam Commercial Bank PCL/The ^(a)	394,400		2,151	Healthcare - Products - 0.78%
Skandinaviska Enskilda Banken AB	333,893		4,289	Nihon Kohden Corp	56,700		2,899
Sumitomo Mitsui Financial Group Inc	73,400		2,993
	$		35,112	Healthcare - Services - 0.40%
Building Materials - 0.89%				Miraca Holdings Inc	35,600		1,495
China Resources Cement Holdings Ltd	2,473,700		1,682
China Singyes Solar Technologies Holdings	857,300		1,642	Home Builders - 3.94%
Ltd ^(b)				Barratt Developments PLC	558,037		3,751
	$		3,324	Bellway PLC	69,950		1,962
				Berkeley Group Holdings PLC	86,577		3,166
Chemicals - 3.38%				Persimmon PLC ^(b)	96,126		2,258
BASF SE	29,401		2,598	Taylor Wimpey PLC	1,859,464		3,532
Nissan Chemical Industries Ltd	184,900		3,428
Nitto Denko Corp	121,300		6,561		$		14,669
	$		12,587	Home Furnishings - 0.87%

Commercial Services - 2.08%				Steinhoff International Holdings Ltd	632,984		3,238
Capita PLC	125,031		2,198
Estacio Participacoes SA	141,900		1,643	Insurance - 3.88%
Kroton Educacional SA	319,600		2,278	AXA SA	107,775		2,489
OHL Mexico SAB de CV ^(b)	583,200		1,637	Genworth MI Canada Inc	45,800		1,601
	$		7,756	Porto Seguro SA	115,800		1,388
				Prudential PLC	147,306		3,411
Computers - 4.46%				Swiss Life Holding AG ^(b)	24,197		5,552
Asustek Computer Inc	357,300		3,648		$		14,441
Ingenico	29,401		2,929
Lenovo Group Ltd	1,486,800		2,192	Internet - 1.50%
Nomura Research Institute Ltd	177,700		5,861	NetEase Inc ADR	30,600		2,898
Obic Co Ltd	55,300		1,974	Tencent Holdings Ltd	166,600		2,678
	$		16,604		$		5,576

Distribution & Wholesale - 0.64%				Lodging - 0.54%
Hitachi High-Technologies Corp	78,700		2,404	Echo Entertainment Group Ltd	599,000		2,011

Diversified Financial Services - 3.60%				Machinery - Diversified - 0.82%
Aberdeen Asset Management PLC	346,557		2,410	Bucher Industries AG	5,100		1,296
Coronation Fund Managers Ltd	240,700		2,084	Hollysys Automation Technologies Ltd ^(b)	71,300		1,749
Fubon Financial Holding Co Ltd	1,034,100		1,751		$		3,045
London Stock Exchange Group PLC	80,191		2,589
Man Group PLC	1,451,932		2,879	Metal Fabrication & Hardware - 0.87%
Mitsubishi UFJ Lease & Finance Co Ltd	325,400		1,718	Catcher Technology Co Ltd	385,100		3,251
	$		13,431
				Mining - 0.78%
Electric - 2.71%				Lundin Mining Corp ^(b)	324,000		1,446
China Resources Power Holdings Co Ltd	2,062,600		6,003	Sumitomo Metal Mining Co Ltd	106,500		1,477
Huaneng Power International Inc	1,573,800		1,935		$		2,923


Schedule of Investments
International Fund I
October 31, 2014



COMMON STOCKS (continued)	Shares Held	Value (000's)		INVESTMENT COMPANIES (continued)		Shares Held	Value(000			's)

Miscellaneous Manufacturing - 1.55%				Publicly Traded Investment Fund (continued)
Largan Precision Co Ltd	50,000	$	3,513	Goldman Sachs Financial Square Funds -		1,752,117		$	1,752
Sunny Optical Technology Group Co Ltd	1,388,700		2,247	Money Market Fund
	$		5,760				$		5,393

Oil & Gas - 4.24%				TOTAL INVESTMENT COMPANIES			$		5,393
Imperial Oil Ltd	61,600		2,964	Total Investments			$		344,585
Inpex Corp	190,500		2,437	Other Assets in Excess of Liabilities, Net - 7.51%			$		27,961
Royal Dutch Shell PLC - A Shares	140,966		5,036	TOTAL NET ASSETS - 100.00%			$		372,546
Sasol Ltd	107,069		5,346	(a)	Fair value of these investments is determined in good faith by the Manager
	$		15,783		under procedures established and periodically reviewed by the Board of
					Directors. At the end of the period, the fair value of these securities totaled
Pharmaceuticals - 7.27%					$2,151 or 0.58% of net assets.
Actelion Ltd ^(b)	32,173		3,832
Alfresa Holdings Corp	117,800		1,495	(b)	Non-Income Producing Security
Astellas Pharma Inc	330,900		5,136
Hikma Pharmaceuticals PLC	54,600		1,656		Portfolio Summary (unaudited)
Jazz Pharmaceuticals PLC ^(b)	25,300		4,272	Country					Percent
Novartis AG	50,142		4,653	Japan					21.87	%
Orion OYJ	54,243		1,845	United Kingdom					9.17	%
Sino Biopharmaceutical Ltd	4,166,000		4,194	Taiwan, Province Of China					8.41	%
	$		27,083	China					7.76	%
				Hong Kong					7.53	%
Real Estate - 1.40%				Canada					6.01	%
China Overseas Land & Investment Ltd	892,400		2,589	Switzerland					4.76	%
Shimao Property Holdings Ltd	1,215,100		2,615	South Africa					4.57	%
	$		5,204	Germany					4.05	%
				France					2.05	%
Retail - 3.19%				United States					2.04	%
Alimentation Couche-Tard Inc	101,800		3,455	Netherlands					2.00	%
Next PLC	42,441		4,382	Norway					1.81	%
Pandora A/S	28,375		2,392	Brazil					1.79	%
USS Co Ltd	105,800		1,665	India					1.60	%
	$		11,894	Ireland					1.15	%
Semiconductors - 5.10%				Sweden					1.15	%
Advanced Semiconductor Engineering Inc	1,739,500		2,098	Korea, Republic Of					1.00	%
Advanced Semiconductor Engineering Inc	30,959		191	Denmark					0.64	%
ADR				Poland					0.58	%
Dialog Semiconductor PLC ^(b)	83,300		2,876	Thailand					0.58	%
MediaTek Inc	104,600		1,494	Australia					0.54	%
NXP Semiconductor NV ^(b)	35,300		2,424	Israel					0.50	%
Realtek Semiconductor Corp	768,400		2,547	Finland					0.49	%
Taiwan Semiconductor Manufacturing Co Ltd	255,800		5,633	Mexico					0.44	%
ADR				Other Assets in Excess of Liabilities, Net					7.51	%
Vanguard International Semiconductor Corp	1,146,100		1,722	TOTAL NET ASSETS					100.00	%
	$		18,985

Software - 1.69%
Constellation Software Inc/Canada	7,300		2,056
IT Holdings Corp	105,300		1,721
Open Text Corp	45,900		2,535
	$		6,312

Telecommunications - 4.28%
Bezeq The Israeli Telecommunication Corp	1,089,826		1,863
Ltd
China Mobile Ltd	277,700		3,455
KDDI Corp	86,200		5,661
MTN Group Ltd	120,400		2,666
PCCW Ltd	3,610,500		2,295
	$		15,940

Toys, Games & Hobbies - 0.77%
Bandai Namco Holdings Inc	116,300		2,886


Water - 0.95%
Guangdong Investment Ltd	2,687,500		3,535

TOTAL COMMON STOCKS	$		339,192
INVESTMENT COMPANIES - 1.45%	Shares Held )	Value (000's

Publicly Traded Investment Fund - 1.45%
BlackRock Liquidity Funds TempFund	3,641,459		3,641
Portfolio


Schedule of Investments
LargeCap Growth Fund
October 31, 2014



COMMON STOCKS - 96.54%	Shares Held	Value (000's)		COMMON STOCKS (continued)	Shares Held	Value (000		's)

Airlines - 4.39%				Mining - 1.33%
Delta Air Lines Inc	1,908,830	$	76,792	Alcoa Inc	2,674,743		$ 44,829
United Continental Holdings Inc ^(a)	1,356,177		71,620
	$		148,412	Oil & Gas - 3.28%
Apparel - 4.91%				Continental Resources Inc/OK ^(a)	457,154		25,770
Nike Inc	1,349,342		125,448	Pioneer Natural Resources Co	450,388		85,150
Under Armour Inc ^(a)	619,098		40,601			$	110,920
	$		166,049	Oil & Gas Services - 2.33%
Banks - 3.84%				Halliburton Co	1,428,337		78,759
Capital One Financial Corp	540,100		44,704
Morgan Stanley	2,440,100		85,282	Pharmaceuticals - 7.32%
	$		129,986	Actavis PLC ^(a)	311,753		75,675
Beverages - 1.12%				Bristol-Myers Squibb Co	1,239,021		72,098
Constellation Brands Inc ^(a)	413,623		37,863	McKesson Corp	490,810		99,836
						$	247,609

Biotechnology - 9.27%				Retail - 8.14%
Biogen Idec Inc ^(a)	347,758		111,658	Chipotle Mexican Grill Inc ^(a)	75,123		47,929
Gilead Sciences Inc ^(a)	1,458,291		163,329	Kohl's Corp	626,400		33,963
Illumina Inc ^(a)	200,697		38,650	L Brands Inc	475,000		34,257
	$		313,637	Starbucks Corp	997,171		75,346
				Tiffany & Co	303,900		29,211
Chemicals - 4.83%				Ulta Salon Cosmetics & Fragrance Inc ^(a)	450,961		54,481
LyondellBasell Industries NV	636,095		58,285			$	275,187
PPG Industries Inc	516,548		105,216
	$		163,501	Semiconductors - 3.39%
				Lam Research Corp	782,957		60,961
Commercial Services - 4.69%				NXP Semiconductor NV ^(a)	781,600		53,665
FleetCor Technologies Inc ^(a)	373,907		56,295			$	114,626
MasterCard Inc	1,220,309		102,201
	$		158,496	Software - 4.63%
				Salesforce.com Inc ^(a)	602,281		38,540
Computers - 7.24%				ServiceNow Inc ^(a)	640,485		43,508
Apple Inc	1,924,517		207,848	Tableau Software Inc ^(a)	327,000		27,007
Western Digital Corp	377,885		37,172	Workday Inc ^(a)	496,790		47,434
	$		245,020			$	156,489

Cosmetics & Personal Care - 1.88%				Transportation - 2.38%
Estee Lauder Cos Inc/The	844,832		63,514	Canadian Pacific Railway Ltd	386,963		80,364

Diversified Financial Services - 5.19%				TOTAL COMMON STOCKS		$	3,264,816
Discover Financial Services	1,285,016		81,958	INVESTMENT COMPANIES - 3.10%	Shares Held		Value(000	's)
Visa Inc	387,064		93,449	Publicly Traded Investment Fund - 3.10%
	$		175,407	Goldman Sachs Financial Square Funds -	105,009,184		105,009
Electronics - 1.02%				Government Fund
Garmin Ltd	621,900		34,503
				TOTAL INVESTMENT COMPANIES		$	105,009
				Total Investments		$	3,369,825
Healthcare - Products - 0.50%				Other Assets in Excess of Liabilities, Net - 0.36%		$	12,336
Edwards Lifesciences Corp ^(a)	141,000		17,050
				TOTAL NET ASSETS - 100.00%		$	3,382,161

Healthcare - Services - 2.92%
Brookdale Senior Living Inc ^(a)	423,700		14,283	(a) Non-Income Producing Security
HCA Holdings Inc ^(a)	1,207,600		84,592
	$		98,875

Internet - 7.90%				Portfolio Summary (unaudited)
Facebook Inc ^(a)	1,214,686		91,089	Sector			Percent
Google Inc - A Shares ^(a)	157,062		89,191	Consumer, Non-cyclical			27.70	%
Priceline Group Inc/The ^(a)	38,430		46,355	Consumer, Cyclical			20.35	%
Splunk Inc ^(a)	615,758		40,689	Technology			15.26	%
	$		267,324	Financial			9.03	%
				Communications			7.90	%
Iron & Steel - 1.13%				Basic Materials			7.29	%
United States Steel Corp	954,400		38,214	Energy			5.61	%
				Industrial			3.40	%
Leisure Products & Services - 1.71%				Exchange Traded Funds			3.10	%
Royal Caribbean Cruises Ltd	849,202		57,720	Other Assets in Excess of Liabilities, Net			0.36	%
				TOTAL NET ASSETS			100.00	%

Lodging - 1.20%
Las Vegas Sands Corp	649,891		40,462


Schedule of Investments
LargeCap Growth Fund I
October 31, 2014



COMMON STOCKS - 97.93%	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Advertising - 0.07%				Biotechnology (continued)
Alliance Data Systems Corp ^(a)	6,433	$	1,823	Gilead Sciences Inc ^(a)	2,415,053	$	270,486
Interpublic Group of Cos Inc/The	72,982		1,415	Illumina Inc ^(a)	15,713		3,026
Omnicom Group Inc	29,755		2,138	Myriad Genetics Inc ^(a)	11,678		461
	$		5,376	Regeneron Pharmaceuticals Inc ^(a)	50,908		20,043
				United Therapeutics Corp ^(a)	8,058		1,055
Aerospace & Defense - 1.63%				Vertex Pharmaceuticals Inc ^(a)	247,075		27,831
B/E Aerospace Inc ^(a)	18,111		1,348
					$		594,148
Boeing Co/The	931,359		116,336
Lockheed Martin Corp	30,067		5,730	Building Materials - 0.44%
Spirit AeroSystems Holdings Inc ^(a)	20,256		797	Lennox International Inc	8,654		770
United Technologies Corp	17,682		1,892	Martin Marietta Materials Inc	10,969		1,282
	$		126,103	Vulcan Materials Co	514,461		31,747
					$		33,799
Agriculture - 0.31%
Altria Group Inc	230,552		11,145	Chemicals - 2.95%
Archer-Daniels-Midland Co	11,406		536	Albemarle Corp	5,106		298
Lorillard Inc	35,904		2,208	Celanese Corp	2,422		142
Philip Morris International Inc	91,386		8,134	Cytec Industries Inc	1,538		72
Reynolds American Inc	28,596		1,799	Dow Chemical Co/The	33,156		1,638
	$		23,822	Eastman Chemical Co	16,177		1,307
				Ecolab Inc	1,197,710		133,221
Airlines - 1.45%				EI du Pont de Nemours & Co	85,847		5,936
Alaska Air Group Inc	22,468		1,196	FMC Corp	23,458		1,345
American Airlines Group Inc	1,940,419		80,236	Huntsman Corp	25,563		624
Copa Holdings SA	4,648		543	International Flavors & Fragrances Inc	14,122		1,400
Delta Air Lines Inc	7,962		320	LyondellBasell Industries NV	52,137		4,777
Southwest Airlines Co	68,322		2,356	Monsanto Co	61,974		7,130
Spirit Airlines Inc ^(a)	12,922		945	NewMarket Corp	1,644		638
United Continental Holdings Inc ^(a)	514,721		27,183	Platform Specialty Products Corp ^(a)	15,358		399
	$		112,779	PPG Industries Inc	16,352		3,331
Apparel - 0.88%				Praxair Inc	28,997		3,653
Deckers Outdoor Corp ^(a)	6,251		547	RPM International Inc	21,278		964
Hanesbrands Inc	163,650		17,283	Sherwin-Williams Co/The	262,984		60,371
Michael Kors Holdings Ltd ^(a)	377,431		29,662	Sigma-Aldrich Corp	9,416		1,280
Nike Inc	79,457		7,387	Westlake Chemical Corp	6,076		429
Ralph Lauren Corp	7,821		1,289		$		228,955
Under Armour Inc ^(a)	138,824		9,105
				Commercial Services - 0.90%
VF Corp	39,734		2,689	Aramark	6,918		193
	$		67,962	Automatic Data Processing Inc	56,090		4,587
				Avis Budget Group Inc ^(a)	18,132		1,011
Automobile Manufacturers - 0.24%
PACCAR Inc	36,051		2,355	Booz Allen Hamilton Holding Corp	12,244		323
Tesla Motors Inc ^(a)	68,773		16,622	CDK Global Inc ^(a)	15,751		529
	$		18,977	Cintas Corp	14,532		1,064
				Equifax Inc	11,242		851
Automobile Parts & Equipment - 0.54%				FleetCor Technologies Inc ^(a)	8,214		1,237
Allison Transmission Holdings Inc	24,379		792	Gartner Inc ^(a)	16,291		1,315
BorgWarner Inc	25,608		1,460	Global Payments Inc	12,500		1,006
Delphi Automotive PLC	506,900		34,966	H&R Block Inc	48,738		1,575
Goodyear Tire & Rubber Co/The	48,908		1,185	Hertz Global Holdings Inc ^(a)	44,155		968
Johnson Controls Inc	31,234		1,476	KAR Auction Services Inc	10,147		308
Lear Corp	11,760		1,088	MasterCard Inc	114,360		9,578
WABCO Holdings Inc ^(a)	10,123		985	McGraw Hill Financial Inc	30,082		2,722
	$		41,952	Moody's Corp	20,975		2,081
				Quanta Services Inc ^(a)	7,649		261
Banks - 1.29%				Robert Half International Inc	24,070		1,319
Morgan Stanley	1,736,700		60,697	RR Donnelley & Sons Co	3,503		61
State Street Corp	522,300		39,413	SEI Investments Co	22,095		854
	$		100,110	Service Corp International/US	29,282		640
Beverages - 0.57%				Total System Services Inc	22,014		744
Brown-Forman Corp	18,424		1,707	United Rentals Inc ^(a)	16,743		1,843
Coca-Cola Co/The	393,017		16,460	Vantiv Inc ^(a)	546,500		16,898
Coca-Cola Enterprises Inc	30,148		1,307	Verisk Analytics Inc ^(a)	265,300		16,541
Constellation Brands Inc ^(a)	17,906		1,639	Western Union Co/The	95,287		1,616
Dr Pepper Snapple Group Inc	23,516		1,628		$		70,125
Keurig Green Mountain Inc	14,008		2,126	Computers - 4.50%
Monster Beverage Corp ^(a)	17,642		1,780
				Accenture PLC - Class A	62,637		5,081
PepsiCo Inc	185,993		17,887	Apple Inc	1,777,087		191,926
	$		44,534	Cognizant Technology Solutions Corp ^(a)	1,365,554		66,707
Biotechnology - 7.66%				Computer Sciences Corp	1,569		95
Alexion Pharmaceuticals Inc ^(a)	460,290		88,082	DST Systems Inc	4,735		456
Amgen Inc	80,887		13,118	EMC Corp/MA	36,598		1,052
Biogen Idec Inc ^(a)	279,434		89,721	Genpact Ltd ^(a)	3,438,676		60,349
Celgene Corp ^(a)	750,072		80,325	IHS Inc ^(a)	11,722		1,536


Schedule of Investments
LargeCap Growth Fund I
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Computers (continued)				Engineering & Construction (continued)
International Business Machines Corp	109,315	$	17,971	SBA Communications Corp ^(a)	12,348	$	1,387
Jack Henry & Associates Inc	14,934		893		$		55,583
NetApp Inc	21,595		924
Riverbed Technology Inc ^(a)	26,637		506	Entertainment - 0.02%
SanDisk Corp	18,506		1,742	Cinemark Holdings Inc	19,871		702
	$		349,238	Lions Gate Entertainment Corp	14,160		469
				Six Flags Entertainment Corp	12,923		521
Consumer Products - 0.08%					$		1,692
Avery Dennison Corp	5,477		256
Church & Dwight Co Inc	23,942		1,734	Environmental Control - 1.39%
				Stericycle Inc ^(a)	855,646		107,811
Kimberly-Clark Corp	38,732		4,426
	$		6,416
				Food - 1.50%
Cosmetics & Personal Care - 1.74%				General Mills Inc	76,191		3,959
Colgate-Palmolive Co	81,037		5,420	Hershey Co/The	14,798		1,419
Estee Lauder Cos Inc/The	1,709,259		128,501	Hormel Foods Corp	22,921		1,236
Procter & Gamble Co/The	15,212		1,328	Ingredion Inc	1,988		154
	$		135,249	Kellogg Co	29,042		1,857
Distribution & Wholesale - 1.70%				Kraft Foods Group Inc	58,714		3,309
Fastenal Co	1,836,395		80,875	Kroger Co/The	63,177		3,520
Fossil Group Inc ^(a)	469,782		47,758	McCormick & Co Inc/MD	22,460		1,588
Genuine Parts Co	16,230		1,576	Sysco Corp	38,950		1,501
HD Supply Holdings Inc ^(a)	18,287		527	Tyson Foods Inc	2,899		117
WW Grainger Inc	5,788		1,428	Whole Foods Market Inc	2,475,274		97,352
	$		132,164		$		116,012

Diversified Financial Services - 6.89%				Forest Products & Paper - 0.01%
Affiliated Managers Group Inc ^(a)	5,485		1,096	International Paper Co	12,124		614
American Express Co	100,254		9,018	Veritiv Corp ^(a)	231		10
Ameriprise Financial Inc	11,799		1,489		$		624
BlackRock Inc	5,384		1,837
CBOE Holdings Inc	14,809		873	Hand & Machine Tools - 0.01%
				Lincoln Electric Holdings Inc	4,952		359
Charles Schwab Corp/The	4,746,288		136,076	Snap-on Inc	1,145		151
Eaton Vance Corp	20,729		763	Stanley Black & Decker Inc	3,106		291
Federated Investors Inc	11,879		371
Franklin Resources Inc	35,825		1,992		$		801
Intercontinental Exchange Inc	109,300		22,766	Healthcare - Products - 2.74%
Invesco Ltd	11,953		484	Baxter International Inc	60,485		4,242
Lazard Ltd	22,250		1,095	Becton Dickinson and Co	21,653		2,787
LPL Financial Holdings Inc	15,788		653	Boston Scientific Corp ^(a)	22,689		301
Santander Consumer USA Holdings Inc	1,015		19	Bruker BioSciences Corp ^(a)	18,881		391
T Rowe Price Group Inc	29,046		2,384	Cooper Cos Inc/The	6,301		1,033
TD Ameritrade Holding Corp	1,664,984		56,177	CR Bard Inc	8,501		1,394
Visa Inc	1,229,492		296,836	DENTSPLY International Inc	7,827		397
Waddell & Reed Financial Inc	14,876		710	Edwards Lifesciences Corp ^(a)	18,159		2,196
	$		534,639	Henry Schein Inc ^(a)	15,101		1,813
				Hologic Inc ^(a)	13,697		359
Electric - 0.02%				IDEXX Laboratories Inc ^(a)	9,264		1,312
Calpine Corp ^(a)	10,855		248
				Intuitive Surgical Inc ^(a)	381,154		188,976
Dominion Resources Inc/VA	6,406		457	ResMed Inc	24,935		1,302
ITC Holdings Corp	25,611		1,014	Sirona Dental Systems Inc ^(a)	6,244		490
	$		1,719	St Jude Medical Inc	20,405		1,309
Electrical Components & Equipment - 0.07%				Stryker Corp	22,457		1,966
AMETEK Inc	26,447		1,379	Techne Corp	3,162		288
Emerson Electric Co	58,390		3,741	Varian Medical Systems Inc ^(a)	17,923		1,508
Hubbell Inc	1,721		195	Zimmer Holdings Inc	2,272		253
	$		5,315		$		212,317

Electronics - 2.09%				Healthcare - Services - 3.08%
Agilent Technologies Inc	8,525		471	Aetna Inc	18,911		1,560
Amphenol Corp	1,890,268		95,610	Centene Corp ^(a)	10,415		965
Gentex Corp/MI	14,294		468	Cigna Corp	3,714		370
Honeywell International Inc	86,805		8,344	Covance Inc ^(a)	757,979		60,563
Mettler-Toledo International Inc ^(a)	5,231		1,352	DaVita HealthCare Partners Inc ^(a)	1,234,319		96,363
National Instruments Corp	1,572,210		49,808	Envision Healthcare Holdings Inc ^(a)	14,407		504
PerkinElmer Inc	3,784		164	HCA Holdings Inc ^(a)	5,512		386
Thermo Fisher Scientific Inc	18,116		2,130	Humana Inc	237,900		33,032
Tyco International Ltd	46,087		1,978	Laboratory Corp of America Holdings ^(a)	6,064		663
Waters Corp ^(a)	15,067		1,669	Mednax Inc ^(a)	11,262		703
	$		161,994	UnitedHealth Group Inc	455,700		43,296
				Universal Health Services Inc	3,546		368
Engineering & Construction - 0.72%					$		238,773
Chicago Bridge & Iron Co NV ADR	16,633		909
Fluor Corp	803,243		53,287


Schedule of Investments
LargeCap Growth Fund I
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Holding Companies - Diversified - 0.01%				Machinery - Diversified (continued)
Liberty TripAdvisor Holdings Inc ^(a)	12,679	$	400	IDEX Corp	13,275	$	994
				Middleby Corp/The ^(a)	10,341		915
Home Builders -0.01%				Nordson Corp	11,619		890
NVR Inc (a)	722		886	Rockwell Automation Inc	15,165		1,704
				Roper Industries Inc	8,163		1,292
				Wabtec Corp/DE	435,798		37,609
Home Furnishings - 0.02%				Xylem Inc/NY	24,058		875
Harman International Industries Inc	11,715		1,258	Zebra Technologies Corp ^(a)	8,886		655
Leggett & Platt Inc	12,368		487		$		60,639

	$		1,745	Media - 1.88%
Housewares - 0.03%				Cablevision Systems Corp	33,876		631
Newell Rubbermaid Inc	28,963		966	CBS Corp	54,623		2,962
Scotts Miracle-Gro Co/The	7,718		457	Charter Communications Inc ^(a)	7,852		1,244
Toro Co	10,029		619	Comcast Corp - Class A	269,628		14,924
Tupperware Brands Corp	8,752		558	DIRECTV ^(a)	53,859		4,675
	$		2,600	Discovery Communications Inc - A Shares ^(a)	1,015,961		35,914
				Discovery Communications Inc - C Shares ^(a)	1,469,993		51,435
Insurance - 0.08%				DISH Network Corp ^(a)	26,923		1,714
American Financial Group Inc/OH	1,833		110	FactSet Research Systems Inc	7,618		1,001
Aon PLC	25,182		2,166	Nielsen NV	36,241		1,540
Arthur J Gallagher & Co	25,554		1,219	Scripps Networks Interactive Inc	18,182		1,404
Erie Indemnity Co	4,413		374	Starz ^(a)	14,591		451
Marsh & McLennan Cos Inc	40,955		2,227	Time Warner Cable Inc	31,692		4,665
Reinsurance Group of America Inc	3,467		292	Twenty-First Century Fox Inc - A Shares	138,928		4,790
	$		6,388	Viacom Inc	49,494		3,597
Internet - 11.96%				Walt Disney Co/The	165,095		15,086
Alibaba Group Holding Ltd ADR^(a)	345,053		34,022		$		146,033
Amazon.com Inc ^(a)	474,112		144,822
Baidu Inc ADR ^(a)	257,934		61,587	Metal Fabrication & Hardware - 0.97%
				Precision Castparts Corp	341,762		75,427
CDW Corp/DE	14,977		462	Valmont Industries Inc	316		43
Ctrip.com International Ltd ADR^(a)	465,100		27,115
eBay Inc ^(a)	125,946		6,612		$		75,470
Equinix Inc	5,269		1,101	Mining - 0.02%
Expedia Inc	17,411		1,479	Compass Minerals International Inc	5,793		497
F5 Networks Inc ^(a)	13,454		1,655	Southern Copper Corp	25,131		723
Facebook Inc ^(a)	1,080,508		81,027	Tahoe Resources Inc ^(a)	2,371		41
Google Inc - A Shares ^(a)	318,982		181,140		$		1,261
Google Inc - C Shares ^(a)	307,858		172,118
Liberty Interactive Corp ^(a)	43,209		1,129	Miscellaneous Manufacturing - 2.87%
Liberty Ventures ^(a)	6,143		216	3M Co	72,521		11,152
				Colfax Corp ^(a)	16,942		921
LinkedIn Corp ^(a)	113,326		25,947
Netflix Inc ^(a)	62,434		24,522	Crane Co	3,211		200
Priceline Group Inc/The ^(a)	113,351		136,725	Danaher Corp	2,508,272		201,665
TripAdvisor Inc ^(a)	19,172		1,700	Dover Corp	21,823		1,734
				Hexcel Corp ^(a)	17,415		729
Twitter Inc ^(a)	47,255		1,960
VeriSign Inc ^(a)	21,415		1,280	Illinois Tool Works Inc	37,895		3,450
Vipshop Holdings Ltd ADR ^(a)	94,400		21,645	Ingersoll-Rand PLC	4,150		260
	$		928,264	ITT Corp	3,726		168
				Parker-Hannifin Corp	13,673		1,737
Leisure Products & Services - 0.05%				Pentair PLC	2,370		159
Harley-Davidson Inc	24,837		1,632	Trinity Industries Inc	21,427		765
Jarden Corp ^(a)	6,937		452		$		222,940
Polaris Industries Inc	11,708		1,766
	$		3,850	Office & Business Equipment - 0.00%
				Pitney Bowes Inc	15,179		375
Lodging - 2.71%
Hilton Worldwide Holdings Inc ^(a)	1,153,092		29,103
				Oil & Gas - 2.64%
Las Vegas Sands Corp	514,363		32,025	Atwood Oceanics Inc	1,836		75
Marriott International Inc/DE	22,030		1,669
MGM Resorts International ^(a)	1,967,312		45,740	Cabot Oil & Gas Corp	40,906		1,272
				Cheniere Energy Inc ^(a)	23,503		1,763
Starwood Hotels & Resorts Worldwide Inc	15,311		1,174	Chesapeake Energy Corp	21,873		485
Wyndham Worldwide Corp	22,607		1,756	Cimarex Energy Co	1,901		216
Wynn Resorts Ltd	517,920		98,410	Concho Resources Inc ^(a)	11,186		1,220
	$		209,877	Continental Resources Inc/OK ^(a)	14,812		835
Machinery - Construction & Mining - 0.02%				EOG Resources Inc	62,260		5,918
Caterpillar Inc	14,816		1,502	EQT Corp	367,406		34,551
				Helmerich & Payne Inc	11,810		1,025
				HollyFrontier Corp	6,477		294
Machinery - Diversified - 0.78%				Kosmos Energy Ltd ^(a)	18,792		175
Cummins Inc	20,404		2,983	Marathon Petroleum Corp	21,506		1,955
Deere & Co	14,452		1,236	Murphy USA Inc ^(a)	3,844		220
Flowserve Corp	156,678		10,653	Nabors Industries Ltd	5,256		94
Graco Inc	10,616		833	Noble Energy Inc	25,525		1,471


Schedule of Investments
LargeCap Growth Fund I
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Oil & Gas (continued)				REITS (continued)
Oasis Petroleum Inc ^(a)	17,984	$	539	Columbia Property Trust Inc	3,349	$	85
Patterson-UTI Energy Inc	13,332		307	Crown Castle International Corp	610,967		47,728
PBF Energy Inc	3,834		100	Equity LifeStyle Properties Inc	10,178		500
Phillips 66	26,636		2,091	Extra Space Storage Inc	20,935		1,218
Pioneer Natural Resources Co	489,108		92,471	Federal Realty Investment Trust	7,938		1,046
QEP Resources Inc	3,155		79	Health Care REIT Inc	28,075		1,996
Range Resources Corp	778,057		53,219	Healthcare Trust of America Inc	5,056		65
Seadrill Ltd	18,625		428	Iron Mountain Inc	26,274		948
SM Energy Co	11,630		655	Omega Healthcare Investors Inc	7,465		285
Southwestern Energy Co ^(a)	34,981		1,137	Public Storage	14,650		2,701
Tesoro Corp	10,041		717	Simon Property Group Inc	25,613		4,590
Valero Energy Corp	23,028		1,154	Tanger Factory Outlet Centers Inc	10,118		362
Whiting Petroleum Corp ^(a)	1,624		99	Ventas Inc	24,737		1,695
	$		204,565	Vornado Realty Trust	7,492		820
				Weyerhaeuser Co	11,092		376
Oil & Gas Services - 4.12%					$		69,565
Baker Hughes Inc	6,429		341
Cameron International Corp ^(a)	23,192		1,381	Retail - 5.95%
Core Laboratories NV	580,054		80,935	Advance Auto Parts Inc	12,649		1,859
FMC Technologies Inc ^(a)	1,920,422		107,621	AutoNation Inc ^(a)	13,134		752
Halliburton Co	96,216		5,305	AutoZone Inc ^(a)	3,755		2,078
MRC Global Inc ^(a)	8,338		175	Bed Bath & Beyond Inc ^(a)	15,583		1,049
National Oilwell Varco Inc	6,585		478	Best Buy Co Inc	15,269		521
Oceaneering International Inc	18,747		1,318	Big Lots Inc	3,079		141
RPC Inc	8,787		144	Brinker International Inc	12,241		657
Schlumberger Ltd	1,228,486		121,202	Burger King Worldwide Inc	17,318		566
Superior Energy Services Inc	1,878		47	CarMax Inc ^(a)	438,500		24,517
Targa Resources Corp	6,648		855	Chipotle Mexican Grill Inc ^(a)	41,869		26,712
	$		319,802	Coach Inc	47,192		1,622
				Copart Inc ^(a)	19,350		647
Packaging & Containers - 0.08%				Costco Wholesale Corp	595,819		79,465
Ball Corp	24,767		1,596	CVS Health Corp	19,882		1,706
Crown Holdings Inc ^(a)	24,621		1,180
Owens-Illinois Inc ^(a)	16,783		432	Dick's Sporting Goods Inc	3,017		137
				Dillard's Inc	3,165		335
Packaging Corp of America	16,983		1,224	Dollar General Corp ^(a)	26,577		1,666
Sealed Air Corp	38,363		1,391	Dollar Tree Inc ^(a)	23,301		1,411
Silgan Holdings Inc	7,641		376	Foot Locker Inc	3,079		172
	$		6,199	Gap Inc/The	29,812		1,130
Pharmaceuticals - 7.42%				Home Depot Inc/The	155,584		15,173
AbbVie Inc	182,360		11,573	Kohl's Corp	2,047		111
Actavis PLC ^(a)	25,137		6,102	Lowe's Cos Inc	1,010,936		57,825
Allergan Inc/United States	300,238		57,063	Macy's Inc	31,780		1,837
AmerisourceBergen Corp	25,450		2,174	McDonald's Corp	97,840		9,171
Bristol-Myers Squibb Co	264,320		15,381	MSC Industrial Direct Co Inc	8,187		663
Cardinal Health Inc	4,975		390	Nordstrom Inc	23,859		1,732
Catamaran Corp ^(a)	36,739		1,751	O'Reilly Automotive Inc ^(a)	12,241		2,153
Eli Lilly & Co	487,600		32,343	Penske Automotive Group Inc	3,377		153
Express Scripts Holding Co ^(a)	1,845,199		141,748	PetSmart Inc	17,894		1,295
Herbalife Ltd	13,524		709	Ross Stores Inc	24,356		1,966
Jazz Pharmaceuticals PLC ^(a)	10,225		1,726	Sally Beauty Holdings Inc ^(a)	20,659		605
Johnson & Johnson	49,513		5,337	Signet Jewelers Ltd	9,951		1,194
Mallinckrodt PLC ^(a)	14,089		1,299	Starbucks Corp	2,164,899		163,579
McKesson Corp	550,679		112,014	TJX Cos Inc/The	79,755		5,050
Mead Johnson Nutrition Co	1,148,559		114,063	Tractor Supply Co	544,195		39,846
Merck & Co Inc	40,606		2,353	Ulta Salon Cosmetics & Fragrance Inc ^(a)	11,420		1,380
Mylan Inc/PA ^(a)	42,487		2,275	Urban Outfitters Inc ^(a)	13,295		404
Quintiles Transnational Holdings Inc ^(a)	4,737		277	Walgreen Co	71,035		4,562
Valeant Pharmaceuticals International Inc ^(a)	492,800		65,562	Wal-Mart Stores Inc	20,152		1,537
Zoetis Inc	49,596		1,843	Williams-Sonoma Inc	16,938		1,101
	$		575,983	World Fuel Services Corp	2,365		98
				Yum! Brands Inc	43,712		3,140
Pipelines - 0.07%					$		461,718
Kinder Morgan Inc/DE	31,197		1,208
Williams Cos Inc/The	73,974		4,106	Semiconductors - 2.21%
	$		5,314	Applied Materials Inc	80,483		1,778
				ASML Holding NV - NY Reg Shares	211,700		21,102
Real Estate - 0.02%				Avago Technologies Ltd	24,308		2,097
CBRE Group Inc ^(a)	48,382		1,548	Intel Corp	46,730		1,589
Jones Lang LaSalle Inc	2,148		291	KLA-Tencor Corp	14,967		1,185
	$		1,839	Micron Technology Inc ^(a)	103,670		3,430
REITS - 0.90%				NVIDIA Corp	16,091		314
				ON Semiconductor Corp ^(a)	40,850		339
American Tower Corp	43,736		4,264
Apartment Investment & Management Co	13,229		473	Qualcomm Inc	1,679,133		131,829
Boston Properties Inc	3,260		413	Skyworks Solutions Inc	21,226		1,236


Schedule of Investments
LargeCap Growth Fund I
October 31, 2014



COMMON STOCKS (continued)	Shares Held	Value(000			's)	CONVERTIBLE PREFERRED STOCKS

Semiconductors (continued)						(continued)		Shares Held	Value(000			's)
Texas Instruments Inc	107,124		$	5,320		Internet (continued)
Xilinx Inc	28,524			1,269		Dropbox Inc ^{(a),(b),(c),(e)}		254,085		$	5,004
		$		171,488					$		9,952

Shipbuilding - 0.01%						TOTAL CONVERTIBLE PREFERRED STOCKS			$		9,952
Huntington Ingalls Industries Inc	7,368			780		Total Investments			$		7,773,665
						Liabilities in Excess of Other Assets, Net - (0.19)%			$		(14,808	)
						TOTAL NET ASSETS - 100.00%			$		7,758,857
Software - 5.75%
Activision Blizzard Inc	56,261			1,123
Adobe Systems Inc ^(a)	49,410			3,465		(a)	Non-Income Producing Security
Akamai Technologies Inc ^(a)	30,636			1,847		(b)	Security is Illiquid
ANSYS Inc ^(a)	692,338			54,390		(c)	Fair value of these investments is determined in good faith by the Manager
Broadridge Financial Solutions Inc	20,465			899			under procedures established and periodically reviewed by the Board of
Cerner Corp ^(a)	29,512			1,869			Directors. At the end of the period, the fair value of these securities totaled
Dun & Bradstreet Corp/The	2,387			293			$9,952 or 0.13% of net assets.
Electronic Arts Inc ^(a)	41,454			1,698		(d)	Restricted Security. At the end of the period, the value of this security
Fidelity National Information Services Inc	6,132			358			totaled $4,948 or 0.06% of net assets. The security was purchased on April
Fiserv Inc ^(a)	29,582			2,055			16, 2014 at a cost of $4,948.
Intuit Inc	28,117			2,475		(e)	Restricted Security. At the end of the period, the value of this security
Microsoft Corp	617,591			28,996			totaled $5,004 or 0.06% of net assets. The security was purchased January
NetSuite Inc ^(a)	623,813			67,783			30, 2014 at a cost of $4,853.
Oracle Corp	379,559			14,822
Paychex Inc	33,156			1,556
PTC Inc ^(a)	21,418			817
Red Hat Inc ^(a)	641,095			37,774			Portfolio Summary (unaudited)
Salesforce.com Inc ^(a)	2,515,902			160,992		Sector					Percent
ServiceNow Inc ^(a)	431,100			29,285		Consumer, Non-cyclical					26.02	%
VMware Inc ^(a)	171,400			14,324		Communications					14.40	%
Workday Inc ^(a)	202,500			19,335		Consumer, Cyclical					13.60	%
		$		446,156		Industrial					12.58	%
						Technology					12.44	%
Telecommunications - 0.36%						Financial					9.18	%
ARRIS Group Inc ^(a)	22,161			665		Energy					6.83	%
CenturyLink Inc	6,141			255		Basic Materials					2.98	%
Corning Inc	54,814			1,120		Exchange Traded Funds					2.13	%
Harris Corp	3,308			230		Utilities					0.02	%
Juniper Networks Inc	16,139			340		Diversified					0.01	%
Level 3 Communications Inc ^(a)	29,964			1,406		Liabilities in Excess of Other Assets, Net					(0.19	)%
Verizon Communications Inc	458,359			23,032		TOTAL NET ASSETS					100.00	%
Windstream Holdings Inc	96,728			1,014
		$		28,062

Transportation - 1.50%
CH Robinson Worldwide Inc	26,131			1,809
FedEx Corp	214,925			35,978
JB Hunt Transport Services Inc	429,600			34,269
Kansas City Southern	173,100			21,255
Kirby Corp ^(a)	9,806			1,084
Landstar System Inc	8,058			596
Norfolk Southern Corp	11,656			1,290
Old Dominion Freight Line Inc ^(a)	10,822			789
Union Pacific Corp	100,409			11,693
United Parcel Service Inc	70,062			7,350
		$		116,113
TOTAL COMMON STOCKS		$		7,598,803
INVESTMENT COMPANIES - 2.13%	Shares Held	Value(000			's)

Publicly Traded Investment Fund - 2.13%
BlackRock Liquidity Funds TempFund	96,887,781			96,888
Portfolio
Goldman Sachs Financial Square Funds -	63,850,587			63,851
Money Market Fund
JP Morgan Prime Money Market Fund	4,171,142			4,171
		$		164,910
TOTAL INVESTMENT COMPANIES		$		164,910
CONVERTIBLE PREFERRED STOCKS -
0.13%	Shares Held	Value(000			's)

Internet - 0.13%
Airbnb Inc ^{(a),(b),(c),(d)}	121,527			4,948


Schedule of Investments
LargeCap S&P 500 Index Fund
October 31, 2014



COMMON STOCKS - 97.47%	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Advertising - 0.23%				Beverages (continued)
Alliance Data Systems Corp ^(a)	12,787	$	3,623	Coca-Cola Co/The	908,970	$	38,068
Interpublic Group of Cos Inc/The	97,037		1,882	Coca-Cola Enterprises Inc	52,018		2,255
Omnicom Group Inc	57,835		4,156	Constellation Brands Inc ^(a)	38,586		3,532
	$		9,661	Dr Pepper Snapple Group Inc	44,933		3,112
				Keurig Green Mountain Inc	28,051		4,257
Aerospace & Defense - 1.91%				Molson Coors Brewing Co	36,656		2,726
Boeing Co/The	154,323		19,277	Monster Beverage Corp ^(a)	33,107		3,340
General Dynamics Corp	73,135		10,221	PepsiCo Inc	346,975		33,368
L-3 Communications Holdings Inc	19,857		2,412		$		94,029
Lockheed Martin Corp	62,123		11,839
Northrop Grumman Corp	47,883		6,606	Biotechnology - 2.97%
Raytheon Co	71,551		7,433	Alexion Pharmaceuticals Inc ^(a)	45,552		8,717
Rockwell Collins Inc	31,110		2,618	Amgen Inc	174,918		28,368
United Technologies Corp	195,911		20,962	Biogen Idec Inc ^(a)	54,378		17,460
	$		81,368	Celgene Corp ^(a)	184,107		19,716
				Gilead Sciences Inc ^(a)	348,099		38,987
Agriculture - 1.66%				Regeneron Pharmaceuticals Inc ^(a)	16,989		6,689
Altria Group Inc	456,738		22,079	Vertex Pharmaceuticals Inc ^(a)	54,824		6,175
Archer-Daniels-Midland Co	148,647		6,986		$		126,112
Lorillard Inc	82,903		5,098
Philip Morris International Inc	359,719		32,019	Building Materials - 0.13%
Reynolds American Inc	70,958		4,464	Martin Marietta Materials Inc	14,177		1,658
	$		70,646	Masco Corp	82,082		1,811
				Vulcan Materials Co	30,145		1,860
Airlines - 0.31%					$		5,329
Delta Air Lines Inc	194,123		7,810
Southwest Airlines Co	157,770		5,440	Chemicals - 2.36%
	$		13,250	Air Products & Chemicals Inc	44,147		5,945
				Airgas Inc	15,446		1,723
Apparel - 0.68%				CF Industries Holdings Inc	11,438		2,974
Michael Kors Holdings Ltd ^(a)	47,265		3,715	Dow Chemical Co/The	258,471		12,768
Nike Inc	161,957		15,057	Eastman Chemical Co	34,341		2,774
Ralph Lauren Corp	13,974		2,303	Ecolab Inc	62,097		6,907
Under Armour Inc ^(a)	38,308		2,512	EI du Pont de Nemours & Co	210,757		14,574
VF Corp	79,417		5,375	FMC Corp	30,664		1,759
	$		28,962	International Flavors & Fragrances Inc	18,689		1,853
Automobile Manufacturers - 0.65%				LyondellBasell Industries NV	97,920		8,972
Ford Motor Co	893,110		12,584	Monsanto Co	120,801		13,897
General Motors Co	310,395		9,747	Mosaic Co/The	73,332		3,249
PACCAR Inc	81,694		5,336	PPG Industries Inc	31,740		6,465
	$		27,667	Praxair Inc	67,248		8,473
				Sherwin-Williams Co/The	19,140		4,394
Automobile Parts & Equipment - 0.39%				Sigma-Aldrich Corp	27,397		3,723
BorgWarner Inc	52,598		2,999		$		100,450
Delphi Automotive PLC	68,998		4,760
Goodyear Tire & Rubber Co/The	63,398		1,536	Coal - 0.05%
Johnson Controls Inc	153,363		7,246	Consol Energy Inc	53,001		1,950
	$		16,541

Banks - 7.28%				Commercial Services - 1.28%
Bank of America Corp	2,421,535		41,554	ADT Corp/The	40,070		1,436
Bank of New York Mellon Corp/The	260,578		10,090	Automatic Data Processing Inc	110,742		9,057
BB&T Corp	165,702		6,277	Cintas Corp	22,248		1,629
Capital One Financial Corp	129,257		10,699	Equifax Inc	28,042		2,124
Citigroup Inc	698,140		37,371	H&R Block Inc	63,346		2,047
Comerica Inc	41,640		1,988	MasterCard Inc	226,654		18,982
Fifth Third Bancorp	192,103		3,840	McGraw Hill Financial Inc	62,381		5,644
Goldman Sachs Group Inc/The	94,353		17,926	Moody's Corp	42,798		4,247
				Quanta Services Inc ^(a)	49,922		1,701
Huntington Bancshares Inc/OH	188,135		1,864
JP Morgan Chase & Co	866,127		52,383	Robert Half International Inc	31,659		1,734
KeyCorp	201,910		2,665	Total System Services Inc	38,054		1,286
				United Rentals Inc ^(a)	22,085		2,431
M&T Bank Corp	30,388		3,713
Morgan Stanley	352,646		12,325	Western Union Co/The	121,993		2,069
Northern Trust Corp	50,994		3,381		$		54,387
PNC Financial Services Group Inc/The	124,479		10,754	Computers - 5.95%
Regions Financial Corp	317,435		3,152	Accenture PLC - Class A	145,359		11,791
State Street Corp	97,526		7,359	Apple Inc	1,378,853		148,916
SunTrust Banks Inc	122,261		4,785	Cognizant Technology Solutions Corp ^(a)	139,989		6,838
US Bancorp/MN	414,938		17,676	Computer Sciences Corp	33,405		2,018
Wells Fargo & Co	1,093,935		58,077	EMC Corp/MA	467,148		13,421
Zions Bancorporation	46,696		1,353	Hewlett-Packard Co	429,756		15,420
	$		309,232	International Business Machines Corp	213,640		35,122
Beverages - 2.21%				NetApp Inc	73,517		3,147
Brown-Forman Corp	36,380		3,371	SanDisk Corp	51,634		4,861
				Seagate Technology PLC	75,256		4,728


Schedule of Investments
LargeCap S&P 500 Index Fund
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Computers (continued)				Electronics - 1.28%
Teradata Corp ^(a)	35,693	$	1,511	Agilent Technologies Inc	76,800	$	4,246
Western Digital Corp	50,654		4,983	Allegion PLC	22,125		1,175
	$		252,756	Amphenol Corp	72,226		3,653
				FLIR Systems Inc	32,637		1,094
Consumer Products - 0.32%				Garmin Ltd	27,943		1,550
Avery Dennison Corp	21,584		1,011	Honeywell International Inc	180,200		17,321
Clorox Co/The	29,670		2,952	Jabil Circuit Inc	46,016		964
Kimberly-Clark Corp	86,105		9,840	PerkinElmer Inc	26,002		1,129
	$		13,803	TE Connectivity Ltd	94,243		5,761
Cosmetics & Personal Care - 1.71%				Thermo Fisher Scientific Inc	91,865		10,801
Avon Products Inc	100,082		1,041	Tyco International Ltd	102,130		4,384
Colgate-Palmolive Co	197,693		13,222	Waters Corp ^(a)	19,335		2,142
Estee Lauder Cos Inc/The	51,805		3,894		$		54,220
Procter & Gamble Co/The	623,503		54,413	Engineering & Construction - 0.09%
	$		72,570	Fluor Corp	36,271		2,406
Distribution & Wholesale - 0.25%				Jacobs Engineering Group Inc ^(a)	30,640		1,454
Fastenal Co	62,871		2,769		$		3,860
Fossil Group Inc ^(a)	10,722		1,090
				Environmental Control - 0.23%
Genuine Parts Co	35,252		3,422	Republic Services Inc	58,155		2,233
WW Grainger Inc	14,017		3,460	Stericycle Inc ^(a)	19,530		2,461
	$		10,741	Waste Management Inc	99,882		4,883
Diversified Financial Services - 2.58%					$		9,577
Affiliated Managers Group Inc ^(a)	12,792		2,556
				Food - 1.56%
American Express Co	207,258		18,643	Campbell Soup Co	41,203		1,820
Ameriprise Financial Inc	43,108		5,439	ConAgra Foods Inc	97,291		3,342
BlackRock Inc	29,050		9,909	General Mills Inc	141,045		7,329
Charles Schwab Corp/The	264,114		7,572	Hershey Co/The	34,359		3,295
CME Group Inc/IL	72,735		6,096	Hormel Foods Corp	30,940		1,668
Discover Financial Services	106,365		6,784	JM Smucker Co/The	23,446		2,438
E*Trade Financial Corp ^(a)	66,484		1,483
				Kellogg Co	58,878		3,766
Franklin Resources Inc	90,713		5,045	Kraft Foods Group Inc	136,776		7,707
Intercontinental Exchange Inc	26,123		5,441	Kroger Co/The	112,586		6,272
Invesco Ltd	99,635		4,032	McCormick & Co Inc/MD	29,892		2,114
Legg Mason Inc	23,469		1,220	Mondelez International Inc	388,217		13,689
NASDAQ OMX Group Inc/The	27,199		1,177	Safeway Inc	53,055		1,850
Navient Corp	96,586		1,910	Sysco Corp	135,117		5,207
T Rowe Price Group Inc	60,575		4,973	Tyson Foods Inc	67,447		2,721
Visa Inc	113,360		27,368	Whole Foods Market Inc	83,186		3,272
	$		109,648		$		66,490

Electric - 2.77%				Forest Products & Paper - 0.16%
AES Corp/VA	153,226		2,156	International Paper Co	98,332		4,977
Ameren Corp	55,873		2,366	MeadWestvaco Corp	38,797		1,714
American Electric Power Co Inc	112,528		6,565		$		6,691
CMS Energy Corp	63,319		2,069
Consolidated Edison Inc	67,444		4,273	Gas - 0.30%
Dominion Resources Inc/VA	134,174		9,567	AGL Resources Inc	27,513		1,483
DTE Energy Co	40,757		3,349	CenterPoint Energy Inc	98,971		2,430
Duke Energy Corp	162,867		13,380	NiSource Inc	72,610		3,054
Edison International	75,026		4,695	Sempra Energy	53,226		5,855
Entergy Corp	41,359		3,475		$		12,822
Exelon Corp	197,851		7,239
FirstEnergy Corp	96,795		3,614	Hand & Machine Tools - 0.12%
Integrys Energy Group Inc	18,413		1,338	Snap-on Inc	13,382		1,768
NextEra Energy Inc	100,482		10,070	Stanley Black & Decker Inc	35,986		3,370
Northeast Utilities	72,763		3,591		$		5,138
NRG Energy Inc	77,766		2,331	Healthcare - Products - 1.82%
Pepco Holdings Inc	57,805		1,580	Baxter International Inc	124,733		8,749
PG&E Corp	108,554		5,462	Becton Dickinson and Co	44,175		5,685
Pinnacle West Capital Corp	25,424		1,563	Boston Scientific Corp ^(a)	305,277		4,054
PPL Corp	152,990		5,353	CareFusion Corp ^(a)	46,714		2,680
Public Service Enterprise Group Inc	116,502		4,813	Covidien PLC	104,028		9,616
SCANA Corp	32,711		1,796	CR Bard Inc	17,187		2,818
Southern Co/The	206,256		9,562	DENTSPLY International Inc	32,648		1,658
TECO Energy Inc	53,722		1,053	Edwards Lifesciences Corp ^(a)	24,417		2,952
Wisconsin Energy Corp	51,931		2,579	Hospira Inc	38,855		2,087
Xcel Energy Inc	116,374		3,895	Intuitive Surgical Inc ^(a)	8,279		4,105
	$		117,734	Medtronic Inc	225,558		15,374
Electrical Components & Equipment - 0.31%				Patterson Cos Inc	19,927		859
AMETEK Inc	56,598		2,952	St Jude Medical Inc	65,558		4,207
Emerson Electric Co	160,712		10,295	Stryker Corp	68,871		6,028
				Varian Medical Systems Inc ^(a)	23,765		1,999
	$		13,247


Schedule of Investments
LargeCap S&P 500 Index Fund
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Healthcare - Products (continued)				Iron & Steel - 0.11%
Zimmer Holdings Inc	38,897	$	4,327	Allegheny Technologies Inc	25,036	$	823
	$		77,198	Nucor Corp	73,421		3,969

Healthcare - Services - 1.36%					$		4,792
Aetna Inc	81,655		6,737	Leisure Products & Services - 0.18%
Cigna Corp	60,750		6,049	Carnival Corp	103,714		4,164
DaVita HealthCare Partners Inc ^(a)	39,563		3,089	Harley-Davidson Inc	50,076		3,290
Humana Inc	35,521		4,932		$		7,454
Laboratory Corp of America Holdings ^(a)	19,550		2,137
Quest Diagnostics Inc	33,255		2,110	Lodging - 0.30%
Tenet Healthcare Corp ^(a)	22,548		1,264	Marriott International Inc/DE	50,183		3,801
UnitedHealth Group Inc	223,740		21,257	Starwood Hotels & Resorts Worldwide Inc	43,873		3,363
Universal Health Services Inc	21,007		2,179	Wyndham Worldwide Corp	28,822		2,239
WellPoint Inc	63,152		8,001	Wynn Resorts Ltd	18,670		3,548
	$		57,755		$		12,951

Holding Companies - Diversified - 0.04%				Machinery - Construction & Mining - 0.37%
Leucadia National Corp	72,982		1,736	Caterpillar Inc	144,577		14,661
				Joy Global Inc	22,607		1,190
					$		15,851
Home Builders - 0.12%
DR Horton Inc	76,375		1,741	Machinery - Diversified - 0.56%
Lennar Corp	40,956		1,764	Cummins Inc	39,386		5,757
Pulte Group Inc	77,914		1,495	Deere & Co	82,535		7,060
	$		5,000	Flowserve Corp	31,502		2,142
				Rockwell Automation Inc	31,748		3,567
Home Furnishings - 0.14%				Roper Industries Inc	23,035		3,646
Harman International Industries Inc	15,683		1,683	Xylem Inc/NY	42,067		1,530
Leggett & Platt Inc	31,607		1,245		$		23,702
Whirlpool Corp	17,960		3,090
	$		6,018	Media - 3.33%
				Cablevision Systems Corp	49,948		930
Housewares - 0.05%				CBS Corp	111,608		6,051
Newell Rubbermaid Inc	63,049		2,101	Comcast Corp - Class A	595,974		32,987
				DIRECTV ^(a)	115,649		10,037
				Discovery Communications Inc - A Shares ^(a)	34,071		1,204
Insurance - 4.02%				Discovery Communications Inc - C Shares ^(a)	62,925		2,202
ACE Ltd	77,303		8,449
Aflac Inc	104,325		6,231	Gannett Co Inc	51,961		1,637
				News Corp ^(a)	114,670		1,775
Allstate Corp/The	99,801		6,472
American International Group Inc	328,575		17,602	Nielsen NV	70,058		2,977
Aon PLC	66,884		5,752	Scripps Networks Interactive Inc	23,877		1,844
Assurant Inc	16,437		1,121	Time Warner Cable Inc	64,157		9,445
Berkshire Hathaway Inc - Class B ^(a)	419,796		58,839	Time Warner Inc	196,847		15,644
Chubb Corp/The	55,377		5,502	Twenty-First Century Fox Inc - A Shares	433,710		14,954
Cincinnati Financial Corp	33,916		1,712	Viacom Inc	87,672		6,372
Genworth Financial Inc ^(a)	114,354		1,600	Walt Disney Co/The	363,654		33,231
Hartford Financial Services Group Inc/The	103,116		4,081		$		141,290
Lincoln National Corp	60,119		3,292	Metal Fabrication & Hardware - 0.17%
Loews Corp	70,208		3,061	Precision Castparts Corp	33,038		7,292
Marsh & McLennan Cos Inc	125,342		6,815
MetLife Inc	258,996		14,048
Progressive Corp/The	123,943		3,273	Mining - 0.32%
Prudential Financial Inc	105,926		9,379	Alcoa Inc	270,877		4,540
Torchmark Corp	30,071		1,593	Freeport-McMoRan Inc	239,266		6,819
Travelers Cos Inc/The	78,073		7,870	Newmont Mining Corp	114,851		2,155
Unum Group	58,674		1,963		$		13,514
XL Group PLC	61,138		2,071	Miscellaneous Manufacturing - 3.02%
	$		170,726	3M Co	149,211		22,944
Internet - 4.51%				Danaher Corp	140,374		11,286
Amazon.com Inc ^(a)	87,244		26,649	Dover Corp	38,352		3,047
eBay Inc ^(a)	260,096		13,655	Eaton Corp PLC	109,588		7,495
Expedia Inc	22,845		1,941	General Electric Co	2,310,552		59,635
F5 Networks Inc ^(a)	17,060		2,098	Illinois Tool Works Inc	84,002		7,648
Facebook Inc ^(a)	479,354		35,947	Ingersoll-Rand PLC	61,600		3,858
Google Inc - A Shares ^(a)	65,420		37,150	Pall Corp	24,594		2,248
Google Inc - C Shares ^(a)	65,415		36,572	Parker-Hannifin Corp	34,264		4,353
Netflix Inc ^(a)	13,837		5,435	Pentair PLC	44,342		2,973
Priceline Group Inc/The ^(a)	12,074		14,564	Textron Inc	64,293		2,670
Symantec Corp	158,997		3,946		$		128,157
TripAdvisor Inc ^(a)	25,646		2,274
VeriSign Inc ^(a)	25,910		1,548	Office & Business Equipment - 0.10%
Yahoo! Inc ^(a)	213,000		9,809	Pitney Bowes Inc	46,702		1,155
				Xerox Corp	249,609		3,315
	$		191,588		$		4,470


Schedule of Investments
LargeCap S&P 500 Index Fund
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Oil & Gas - 6.96%				Pipelines (continued)
Anadarko Petroleum Corp	116,510	$	10,693	Williams Cos Inc/The	154,878	$	8,597
Apache Corp	88,074		6,799		$		23,328
Cabot Oil & Gas Corp	96,092		2,988
Chesapeake Energy Corp	119,583		2,652	Publicly Traded Investment Fund - 0.38%
Chevron Corp	437,276		52,451	iShares Core S&P 500 ETF	79,601		16,158
Cimarex Energy Co	20,039		2,278
ConocoPhillips	283,138		20,428	Real Estate - 0.05%
Denbury Resources Inc	81,123		1,006	CBRE Group Inc ^(a)	64,242		2,056
Devon Energy Corp	88,553		5,313
Diamond Offshore Drilling Inc	15,475		584
Ensco PLC	53,818		2,184	REITS - 2.27%
EOG Resources Inc	126,065		11,983	American Tower Corp	91,222		8,894
EQT Corp	34,887		3,281	Apartment Investment & Management Co	33,643		1,204
Exxon Mobil Corp	982,050		94,974	AvalonBay Communities Inc	30,209		4,708
Helmerich & Payne Inc	24,922		2,164	Boston Properties Inc	35,255		4,469
Hess Corp	60,232		5,108	Crown Castle International Corp	76,879		6,006
Marathon Oil Corp	155,316		5,498	Equity Residential	83,300		5,794
Marathon Petroleum Corp	65,243		5,931	Essex Property Trust Inc	14,619		2,950
Murphy Oil Corp	38,437		2,052	General Growth Properties Inc	144,501		3,744
Nabors Industries Ltd	66,634		1,189	HCP Inc	105,655		4,646
Newfield Exploration Co ^(a)	31,468		1,026	Health Care REIT Inc	74,619		5,306
Noble Corp PLC	58,550		1,225	Host Hotels & Resorts Inc	174,304		4,063
Noble Energy Inc	82,955		4,781	Iron Mountain Inc	39,578		1,428
Occidental Petroleum Corp	179,528		15,965	Kimco Realty Corp	94,647		2,361
Phillips 66	128,698		10,103	Macerich Co/The	32,398		2,284
Pioneer Natural Resources Co	32,952		6,230	Plum Creek Timber Co Inc	40,787		1,673
QEP Resources Inc	38,153		957	Prologis Inc	115,135		4,795
Range Resources Corp	38,847		2,657	Public Storage	33,394		6,156
Southwestern Energy Co ^(a)	81,322		2,644	Simon Property Group Inc	71,561		12,824
Tesoro Corp	29,530		2,109	Ventas Inc	67,778		4,643
Transocean Ltd	78,398		2,339	Vornado Realty Trust	40,189		4,400
Valero Energy Corp	121,576		6,090	Weyerhaeuser Co	121,655		4,119
	$		295,682		$		96,467

Oil & Gas Services - 1.38%				Retail - 5.84%
				AutoNation Inc ^(a)	18,016		1,032
Baker Hughes Inc	100,179		5,305	AutoZone Inc ^(a)	7,507		4,155
Cameron International Corp ^(a)	46,723		2,782
				Bed Bath & Beyond Inc ^(a)	42,624		2,870
FMC Technologies Inc ^(a)	54,082		3,031
Halliburton Co	195,855		10,799	Best Buy Co Inc	66,821		2,281
				CarMax Inc ^(a)	50,484		2,823
National Oilwell Varco Inc	99,073		7,197	Chipotle Mexican Grill Inc ^(a)	7,142		4,557
Schlumberger Ltd	298,536		29,454
	$		58,568	Coach Inc	63,241		2,174
				Costco Wholesale Corp	100,928		13,461
Packaging & Containers - 0.13%				CVS Health Corp	266,687		22,884
Ball Corp	31,879		2,054	Darden Restaurants Inc	30,469		1,578
Bemis Co Inc	23,000		885	Dollar General Corp ^(a)	69,865		4,378
Owens-Illinois Inc ^(a)	37,959		978	Dollar Tree Inc ^(a)	47,350		2,868
Sealed Air Corp	48,823		1,770	Family Dollar Stores Inc	22,042		1,726
	$		5,687	GameStop Corp	25,944		1,109
				Gap Inc/The	63,087		2,390
Pharmaceuticals - 7.31%				Home Depot Inc/The	309,932		30,225
Abbott Laboratories	346,264		15,094	Kohl's Corp	47,130		2,555
AbbVie Inc	366,528		23,260	L Brands Inc	56,550		4,078
Actavis PLC ^(a)	60,853		14,772
				Lowe's Cos Inc	227,306		13,002
Allergan Inc/United States	68,434		13,007	Macy's Inc	81,316		4,702
AmerisourceBergen Corp	49,086		4,192	McDonald's Corp	226,113		21,194
Bristol-Myers Squibb Co	381,773		22,215	Nordstrom Inc	32,822		2,383
Cardinal Health Inc	77,523		6,084	O'Reilly Automotive Inc ^(a)	23,895		4,203
Eli Lilly & Co	226,413		15,018	PetSmart Inc	22,874		1,655
Express Scripts Holding Co ^(a)	171,658		13,187
				PVH Corp	18,973		2,170
Johnson & Johnson	649,440		69,997	Ross Stores Inc	48,319		3,900
Mallinckrodt PLC ^(a)	26,083		2,404
				Staples Inc	148,343		1,881
McKesson Corp	53,331		10,848	Starbucks Corp	172,982		13,070
Mead Johnson Nutrition Co	46,554		4,623	Target Corp	145,929		9,021
Merck & Co Inc	664,257		38,487	Tiffany & Co	25,903		2,490
Mylan Inc/PA ^(a)	86,133		4,612
				TJX Cos Inc/The	159,567		10,104
Perrigo Co PLC	30,815		4,975	Tractor Supply Co	31,704		2,321
Pfizer Inc ^(b)	1,460,139		43,731
				Urban Outfitters Inc ^(a)	23,510		714
Zoetis Inc	115,412		4,289	Walgreen Co	202,650		13,014
	$		310,795	Wal-Mart Stores Inc	363,611		27,733
Pipelines - 0.55%				Yum! Brands Inc	101,240		7,272
Kinder Morgan Inc/DE	151,488		5,863		$		247,973
ONEOK Inc	47,898		2,823
Spectra Energy Corp	154,490		6,045


Schedule of Investments
LargeCap S&P 500 Index Fund
October 31, 2014



COMMON STOCKS (continued)	Shares Held	Value (000's)		INVESTMENT COMPANIES - 2.54%		Shares Held		Value(000			's)

Savings & Loans - 0.05%				Publicly Traded Investment Fund - 2.54%
Hudson City Bancorp Inc	110,803	$	1,069	Morgan Stanley Institutional Liquidity Funds -		107,768,986			$	107,769
People's United Financial Inc	71,455		1,045	Government Portfolio
	$		2,114
				TOTAL INVESTMENT COMPANIES				$		107,769
Semiconductors - 3.02%				Total Investments			$	4,249,363
Altera Corp	71,150		2,445
Analog Devices Inc	72,355		3,590	Liabilities in Excess of Other Assets, Net - (0.01)%				$		(339	)
Applied Materials Inc	280,565		6,198	TOTAL NET ASSETS - 100.00%			$	4,249,024
Avago Technologies Ltd	57,964		4,999
Broadcom Corp	123,844		5,187
First Solar Inc ^(a)	17,304		1,019	(a)	Non-Income Producing Security
				(b)	Security or a portion of the security was pledged to cover margin
Intel Corp	1,140,089		38,774		requirements for futures contracts. At the end of the period, the value of
KLA-Tencor Corp	38,080		3,014		these securities totaled $10,689 or 0.25% of net assets.
Lam Research Corp	37,322		2,906
Linear Technology Corp	54,923		2,353
Microchip Technology Inc	46,147		1,989
Micron Technology Inc ^(a)	246,583		8,160		Portfolio Summary (unaudited)
NVIDIA Corp	118,550		2,317	Sector						Percent
Qualcomm Inc	385,946		30,301	Consumer, Non-cyclical						22.28	%
Texas Instruments Inc	245,831		12,208	Financial						16.25	%
Xilinx Inc	61,825		2,750	Technology						13.05	%
	$		128,210	Communications						11.36	%
Software - 4.06%				Industrial						10.10	%
Adobe Systems Inc ^(a)	108,806		7,630	Consumer, Cyclical						9.05	%
Akamai Technologies Inc ^(a)	41,026		2,474	Energy						8.94	%
Autodesk Inc ^(a)	52,327		3,011	Utilities						3.07	%
CA Inc	73,790		2,144	Basic Materials						2.95	%
Cerner Corp ^(a)	69,897		4,427	Exchange Traded Funds						2.92	%
Citrix Systems Inc ^(a)	37,873		2,433	Diversified						0.04	%
Dun & Bradstreet Corp/The	8,375		1,029	Liabilities in Excess of Other Assets, Net						(0.01	)%
Electronic Arts Inc ^(a)	71,987		2,949	TOTAL NET ASSETS						100.00	%
Fidelity National Information Services Inc	65,724		3,838
Fiserv Inc ^(a)	57,389		3,987
Intuit Inc	65,372		5,753
Microsoft Corp	1,897,427		89,084
Oracle Corp	748,869		29,243
Paychex Inc	75,251		3,532
Red Hat Inc ^(a)	43,544		2,566
Salesforce.com Inc ^(a)	132,562		8,483
	$		172,583

Telecommunications - 3.29%
AT&T Inc	1,194,204		41,606
CenturyLink Inc	131,294		5,446
Cisco Systems Inc	1,174,217		28,733
Corning Inc	297,291		6,074
Frontier Communications Corp	230,759		1,509
Harris Corp	24,126		1,679
Juniper Networks Inc	92,468		1,948
Motorola Solutions Inc	50,839		3,279
Verizon Communications Inc	954,541		47,966
Windstream Holdings Inc	138,780		1,455
	$		139,695

Textiles - 0.05%
Mohawk Industries Inc ^(a)	14,256		2,025

Toys, Games & Hobbies - 0.09%
Hasbro Inc	26,420		1,520
Mattel Inc	77,798		2,417
	$		3,937

Transportation - 1.78%
CH Robinson Worldwide Inc	33,887		2,345
CSX Corp	230,176		8,201
Expeditors International of Washington Inc	44,928		1,917
FedEx Corp	61,125		10,232
Kansas City Southern	25,408		3,120
Norfolk Southern Corp	71,273		7,886
Ryder System Inc	12,220		1,081
Union Pacific Corp	206,655		24,065
United Parcel Service Inc	161,974		16,993
	$		75,840
TOTAL COMMON STOCKS	$		4,141,594


Schedule of Investments
LargeCap Value Fund
October 31, 2014



COMMON STOCKS - 97.99%	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Aerospace & Defense - 4.71%				Insurance - 4.36%
General Dynamics Corp	239,695	$	33,500	American International Group Inc	1,518,613	$	81,352
Raytheon Co	653,178		67,852	PartnerRe Ltd	423,430		48,987
United Technologies Corp	701,816		75,094	Prudential Financial Inc	372,208		32,955
	$		176,446		$		163,294

Agriculture - 2.82%				Iron & Steel - 0.78%
Archer-Daniels-Midland Co	1,159,488		54,496	United States Steel Corp	726,694		29,097
Philip Morris International Inc	576,675		51,330
	$		105,826	Media - 2.74%
Airlines - 2.54%				Comcast Corp - Class A	1,269,887		70,288
Delta Air Lines Inc	823,928		33,147	Time Warner Inc	409,113		32,512
Southwest Airlines Co	1,804,192		62,208		$		102,800
	$		95,355	Miscellaneous Manufacturing - 3.13%
Automobile Parts & Equipment - 0.96%				Danaher Corp	646,017		51,940
Lear Corp	389,622		36,040	General Electric Co	622,635		16,070
				Ingersoll-Rand PLC	785,735		49,203
					$		117,213
Banks - 15.95%
Bank of America Corp	5,862,865		100,607	Office & Business Equipment - 0.61%
Capital One Financial Corp	111,310		9,213	Xerox Corp	1,714,846		22,774
Goldman Sachs Group Inc/The	518,064		98,427
Huntington Bancshares Inc/OH	3,724,154		36,906	Oil & Gas - 9.61%
JP Morgan Chase & Co	879,859		53,214	Antero Resources Corp ^(a)	328,143		17,208
KeyCorp	5,412,222		71,441	Chevron Corp	448,037		53,742
PNC Financial Services Group Inc/The	549,653		47,485	Cimarex Energy Co	221,527		25,181
Wells Fargo & Co	3,406,733		180,863	ConocoPhillips	982,590		70,894
	$		598,156	EOG Resources Inc	273,353		25,982
Chemicals - 1.83%				EQT Corp	237,701		22,353
LyondellBasell Industries NV	749,859		68,710	Exxon Mobil Corp	1,083,794		104,814
				Valero Energy Corp	798,039		39,974
					$		360,148
Commercial Services - 0.80%
Quanta Services Inc ^(a)	881,291		30,034	Pharmaceuticals - 10.06%
				AbbVie Inc	870,861		55,265
				Bristol-Myers Squibb Co	345,314		20,094
Computers - 4.39%				Cardinal Health Inc	1,131,598		88,808
Apple Inc	266,256		28,756	Johnson & Johnson	876,405		94,459
Hewlett-Packard Co	991,499		35,575	Pfizer Inc	3,963,262		118,699
Lexmark International Inc	343,495		14,825		$		377,325
Western Digital Corp	868,889		85,473
	$		164,629	REITS - 3.54%
				Duke Realty Corp	1,777,381		33,699
Cosmetics & Personal Care - 0.15%				Extra Space Storage Inc	590,292		34,331
Procter & Gamble Co/The	64,334		5,614	General Growth Properties Inc	1,756,151		45,502
				Host Hotels & Resorts Inc	173,789		4,051
Diversified Financial Services - 3.87%				UDR Inc	503,062		15,208
BlackRock Inc	180,887		61,703		$		132,791
Discover Financial Services	1,304,768		83,218	Retail - 2.49%
	$		144,921	Foot Locker Inc	824,475		46,179
Electric - 6.84%				Macy's Inc	626,916		36,248
Entergy Corp	981,298		82,448	Wal-Mart Stores Inc	144,204		10,999
Exelon Corp	1,858,675		68,009		$		93,426
PPL Corp	1,396,027		48,847	Semiconductors - 3.58%
Public Service Enterprise Group Inc	1,385,448		57,233	Broadcom Corp	1,032,425		43,238
	$		256,537	Intel Corp	2,680,020		91,147
Engineering & Construction - 0.44%					$		134,385
AECOM Technology Corp ^(a)	503,021		16,373
				Software - 3.06%
				Electronic Arts Inc ^(a)	788,800		32,317
Food - 3.28%				Microsoft Corp	1,755,242		82,409
Kroger Co/The	1,278,708		71,237		$		114,726
Tyson Foods Inc ^(b)	1,278,005		51,567
	$		122,804	Telecommunications - 0.72%
				AT&T Inc	590,169		20,561
Healthcare - Products - 1.79%				Cisco Systems Inc	255,232		6,246
Boston Scientific Corp ^(a)	2,540,038		33,732		$		26,807
St Jude Medical Inc	521,417		33,459	TOTAL COMMON STOCKS	$		3,673,823
	$		67,191

Healthcare - Services - 2.94%
Aetna Inc	718,831		59,311
WellPoint Inc	403,270		51,090
	$		110,401


Schedule of Investments
LargeCap Value Fund
October 31, 2014



INVESTMENT COMPANIES - 2.06%		Shares Held			Value (000's)

Publicly Traded Investment Fund - 2.06%
Goldman Sachs Financial Square Funds -			77,301,539	$	77,302
Government Fund

TOTAL INVESTMENT COMPANIES			$		77,302
Total Investments			$		3,751,125
Liabilities in Excess of Other Assets, Net - (0.05)%			$		(1,760	)
TOTAL NET ASSETS - 100.00%			$		3,749,365


(a)	Non-Income Producing Security
(b)	Security or a portion of the security was pledged to cover margin
	requirements for futures contracts. At the end of the period, the value of
	these securities totaled $5,649 or 0.15% of net assets.



	Portfolio Summary (unaudited)
Sector					Percent
Financial					27.72	%
Consumer, Non-cyclical					21.84	%
Technology					11.64	%
Energy					9.61	%
Industrial					8.28	%
Utilities					6.84	%
Consumer, Cyclical					5.99	%
Communications					3.46	%
Basic Materials					2.61	%
Exchange Traded Funds					2.06	%
Liabilities in Excess of Other Assets, Net					(0.05	)%
TOTAL NET ASSETS					100.00	%

Futures Contracts

											Unrealized Appreciation/(Depreciation)
Type			Long/Short Contracts				Notional Value		Fair Value		Unrealized Appreciation/(Depreciation)
S&P 500 Emini; December 2014			Long		371	$	36,859	$		37,311	$	452
Total										$		452

Amounts in thousands except contracts


Schedule of Investments
MidCap Fund
October 31, 2014



COMMON STOCKS - 99.80%	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Aerospace & Defense - 1.61%				Insurance - 11.30%
Rockwell Collins Inc	682,733	$	57,452	Alleghany Corp ^(a)	101,769	$	45,214
TransDigm Group Inc	454,649		85,033	Aon PLC	1,964,120		168,914
	$		142,485	Arch Capital Group Ltd ^(a)	769,108		43,316
				Brown & Brown Inc	3,337,543		106,334
Banks - 1.23%				Loews Corp	3,859,096		168,257
BankUnited Inc	395,262		11,818	Markel Corp ^(a)	368,573		254,643
M&T Bank Corp	792,279		96,801	Progressive Corp/The	2,879,535		76,049
	$		108,619	White Mountains Insurance Group Ltd	119,973		74,974
Building Materials - 1.17%				Willis Group Holdings PLC	1,577,308		63,928
Martin Marietta Materials Inc	885,006		103,475		$		1,001,629
				Internet - 4.31%
Chemicals - 5.03%				Liberty Interactive Corp ^(a)	5,845,885		152,811
Air Products & Chemicals Inc	1,422,088		191,498	Liberty Ventures ^(a)	2,671,582		93,773
Airgas Inc	980,632		109,380	VeriSign Inc ^(a)	2,272,019		135,776
Ashland Inc	948,874		102,545		$		382,360
Ecolab Inc	383,137		42,616	Lodging - 1.46%
	$		446,039	Wyndham Worldwide Corp	896,548		69,635
Commercial Services - 7.43%				Wynn Resorts Ltd	315,482		59,945
Ascent Capital Group Inc ^(a)	437,699		28,144		$		129,580
KAR Auction Services Inc	3,234,508		98,200	Machinery - Diversified - 0.64%
Live Nation Entertainment Inc ^(a)	2,854,849		74,226
				Roper Industries Inc	356,882		56,495
Macquarie Infrastructure Co LLC	1,131,983		81,095
McGraw Hill Financial Inc	1,021,167		92,395
Moody's Corp	1,648,380		163,569	Media - 7.52%
Robert Half International Inc	770,281		42,196	Discovery Communications Inc - C Shares ^(a)	4,730,538		165,521
Verisk Analytics Inc ^(a)	1,262,371		78,709	FactSet Research Systems Inc	357,936		47,047
	$		658,534	Liberty Global PLC - A Shares ^(a)	1,011,808		46,007
				Liberty Global PLC - C Shares ^(a)	3,280,945		145,904
Distribution & Wholesale - 1.87%				Liberty Media Corp - A shares ^(a)	1,761,760		84,600
Fastenal Co	1,553,845		68,431	Liberty Media Corp - C shares ^(a)	3,375,520		161,789
HD Supply Holdings Inc ^(a)	1,121,595		32,347	Tribune Media Co ^(a)	232,658		15,588
WW Grainger Inc	263,136		64,942		$		666,456
	$		165,720
				Miscellaneous Manufacturing - 1.48%
Diversified Financial Services - 2.49%				Colfax Corp ^(a)	1,921,839		104,509
Charles Schwab Corp/The	4,038,862		115,794	Donaldson Co Inc	641,169		26,660
FNF Group	3,134,325		93,528		$		131,169
FNFV Group ^(a)	880,052		11,828
	$		221,150	Oil & Gas - 3.62%
				Apache Corp	246,226		19,009
Electric - 1.58%				Cimarex Energy Co	724,096		82,308
Brookfield Infrastructure Partners LP	1,872,673		76,012	EOG Resources Inc	1,084,226		103,056
Brookfield Renewable Energy Partners LP/CA	675,681		21,372	Hess Corp	1,377,297		116,808
Calpine Corp ^(a)	1,875,731		42,804
					$		321,181
	$		140,188
				Pharmaceuticals - 3.68%
Electronics - 0.89%				Mead Johnson Nutrition Co	1,208,883		120,054
Sensata Technologies Holding NV ^(a)	1,620,343		79,089	Valeant Pharmaceuticals International Inc ^(a)	1,549,699		206,172
					$		326,226

Engineering & Construction - 1.06%				Pipelines - 3.21%
SBA Communications Corp ^(a)	832,858		93,555
				Kinder Morgan Inc/DE	3,437,667		133,038
				Kinder Morgan Inc/DE - Warrants ^(a)	994,027		3,459
Forest Products & Paper - 0.33%				Williams Cos Inc/The	2,674,126		148,441
MeadWestvaco Corp	655,700		28,962		$		284,938
				Private Equity - 0.62%
Gas - 0.36%				Onex Corp	982,919		55,338
National Fuel Gas Co	459,931		31,841
				Real Estate - 6.91%
Healthcare - Products - 3.19%				Brookfield Asset Management Inc	7,345,150		359,692
Becton Dickinson and Co	752,036		96,787	Brookfield Property Partners LP	1,255,081		28,553
CR Bard Inc	756,684		124,073	CBRE Group Inc ^(a)	2,701,096		86,435
DENTSPLY International Inc	1,225,659		62,227	Forest City Enterprises Inc ^(a)	3,807,598		79,541
	$		283,087	Howard Hughes Corp/The ^(a)	394,118		58,085
					$		612,306
Healthcare - Services - 1.37%
Laboratory Corp of America Holdings ^(a)	1,109,205		121,225	REITS - 1.97%
				Crown Castle International Corp	2,057,949		160,767
				General Growth Properties Inc	530,273		13,739
Holding Companies - Diversified - 1.62%					$		174,506
Leucadia National Corp	4,550,148		108,203
Liberty TripAdvisor Holdings Inc ^(a)	1,109,529		35,039	Retail - 12.86%
	$		143,242	AutoZone Inc ^(a)	251,021		138,945


				Schedule of Investments
				MidCap Fund
				October 31, 2014


COMMON STOCKS (continued)	Shares Held	Value(000			's)

Retail (continued)
Burger King Worldwide Inc	4,105,517		$	134,168
CarMax Inc ^(a)	2,159,807			120,755
Copart Inc ^(a)	1,992,018			66,613
Dollar General Corp ^(a)	1,759,178			110,248
O'Reilly Automotive Inc ^(a)	1,627,509			286,246
Ross Stores Inc	981,380			79,217
TJX Cos Inc/The	3,221,920			204,012
		$		1,140,204

Semiconductors - 1.21%
Microchip Technology Inc	2,485,174			107,136


Software - 4.46%
Adobe Systems Inc ^(a)	1,382,561			96,945
Fidelity National Information Services Inc	2,234,651			130,481
Intuit Inc	1,403,169			123,493
MSCI Inc	959,341			44,763
		$		395,682

Telecommunications - 2.18%
EchoStar Corp ^(a)	1,263,245			59,031
Motorola Solutions Inc	2,084,416			134,445
		$		193,476

Textiles - 1.14%
Mohawk Industries Inc ^(a)	713,917			101,405

TOTAL COMMON STOCKS		$		8,847,298
INVESTMENT COMPANIES - 0.32%	Shares Held	Value(000			's)

Publicly Traded Investment Fund - 0.32%
Goldman Sachs Financial Square Funds -	28,289,276			28,289
Government Fund

TOTAL INVESTMENT COMPANIES		$		28,289
Total Investments		$		8,875,587
Liabilities in Excess of Other Assets, Net - (0.12)%		$		(10,361	)
TOTAL NET ASSETS - 100.00%		$		8,865,226


(a) Non-Income Producing Security



Portfolio Summary (unaudited)
Sector				Percent
Financial				24.52	%
Consumer, Cyclical				17.33	%
Consumer, Non-cyclical				15.67	%
Communications				14.01	%
Industrial				6.85	%
Energy				6.83	%
Technology				5.67	%
Basic Materials				5.36	%
Utilities				1.94	%
Diversified				1.62	%
Exchange Traded Funds				0.32	%
Liabilities in Excess of Other Assets, Net				(0.12	)%
TOTAL NET ASSETS				100.00	%


Schedule of Investments
MidCap Value Fund III
October 31, 2014



COMMON STOCKS - 96.12%	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Aerospace & Defense - 1.95%				Building Materials (continued)
Alliant Techsystems Inc	1,280	$	150	Vulcan Materials Co	5,090	$	314
Exelis Inc	11,237		201		$		11,377
L-3 Communications Holdings Inc	100,843		12,248
Spirit AeroSystems Holdings Inc ^(a)	160,500		6,314	Chemicals - 1.80%
				Albemarle Corp	2,743		160
Triumph Group Inc	2,287		159	Ashland Inc	3,024		327
	$		19,072	Cabot Corp	3,507		163
Agriculture - 2.24%				Celanese Corp	5,687		334
Bunge Ltd	5,812		515	CF Industries Holdings Inc	2,079		541
Lorillard Inc	163,937		10,082	Cytec Industries Inc	3,670		171
Reynolds American Inc	180,700		11,368	Eastman Chemical Co	778		63
	$		21,965	Huntsman Corp	3,465		85
				Mosaic Co/The	13,025		577
Airlines - 1.39%				Rockwood Holdings Inc	62,043		4,771
Alaska Air Group Inc	596		32	RPM International Inc	557		25
Copa Holdings SA	412		48	Sigma-Aldrich Corp	2,177		296
Southwest Airlines Co	393,638		13,572	Westlake Chemical Corp	143,263		10,107
	$		13,652		$		17,620

Apparel - 1.87%				Coal - 0.03%
Deckers Outdoor Corp ^(a)	26,070		2,280	Consol Energy Inc	7,757		285
Hanesbrands Inc	150,400		15,884
Ralph Lauren Corp	866		143
	$		18,307	Commercial Services - 1.70%
				ADT Corp/The	6,572		236
Automobile Manufacturers - 0.28%				Apollo Education Group Inc ^(a)	5,823		167
Oshkosh Corp	62,111		2,780	DeVry Education Group Inc	3,644		176
				Equifax Inc	2,146		163
Automobile Parts & Equipment - 1.28%				Graham Holdings Co	201		158
Delphi Automotive PLC	172,200		11,878	KAR Auction Services Inc	4,819		146
Lear Corp	933		86	Manpowergroup Inc	2,961		198
TRW Automotive Holdings Corp ^(a)	4,200		426	Quanta Services Inc ^(a)	187,442		6,388
Visteon Corp ^(a)	1,838		173	RR Donnelley & Sons Co	10,368		181
	$		12,563	Service Corp International/US	2,717		59
				Total System Services Inc	251,618		8,502
Banks - 7.17%				Towers Watson & Co	2,203		243
Associated Banc-Corp	9,278		175	Vectrus Inc ^(a)	624		15
Bank of Hawaii Corp	2,676		157		$		16,632
BankUnited Inc	5,860		175
BOK Financial Corp	1,582		109	Computers - 4.09%
Capital One Financial Corp	151,100		12,507	Amdocs Ltd	232,088		11,034
CIT Group Inc	259,785		12,711	Brocade Communications Systems Inc	829,077		8,896
City National Corp/CA	2,728		215	Computer Sciences Corp	5,138		310
Comerica Inc	7,314		349	DST Systems Inc	24,338		2,345
				Genpact Ltd ^(a)	8,205		144
Cullen/Frost Bankers Inc	2,130		172
East West Bancorp Inc	67,706		2,489	Lexmark International Inc	3,698		160
				NCR Corp ^(a)	8,695		241
Fifth Third Bancorp	815,764		16,306
First Horizon National Corp	13,556		174	NetApp Inc	8,027		343
First Republic Bank/CA	4,649		237	SanDisk Corp	43,073		4,055
				Synopsys Inc ^(a)	5,900		242
Fulton Financial Corp	11,650		138	Teradata Corp ^(a)	1,918		81
Huntington Bancshares Inc/OH	762,786		7,559
KeyCorp	839,643		11,083	Western Digital Corp	124,189		12,216
M&T Bank Corp	4,441		543		$		40,067
Northern Trust Corp	9,157		607	Consumer Products - 0.39%
PacWest Bancorp	3,891		166	Avery Dennison Corp	82,413		3,861
Regions Financial Corp	53,966		536
SunTrust Banks Inc	20,879		817
SVB Financial Group ^(a)	23,956		2,683	Distribution & Wholesale - 0.03%
TCF Financial Corp	9,854		152	Genuine Parts Co	469		46
Zions Bancorporation	6,238		181	WESCO International Inc ^(a)	2,587		213
	$		70,241		$		259

Beverages - 0.05%				Diversified Financial Services - 5.88%
Constellation Brands Inc ^(a)	633		58	Air Lease Corp	5,466		200
Molson Coors Brewing Co	5,425		403	Ameriprise Financial Inc	129,923		16,393
	$		461	Discover Financial Services	271,380		17,308
				E*Trade Financial Corp ^(a)	9,674		216
Biotechnology - 0.02%				FNF Group	9,341		279
Bio-Rad Laboratories Inc ^(a)	1,201		136	FNFV Group ^(a)	5,365		72
Myriad Genetics Inc ^(a)	536		21	Intercontinental Exchange Inc	2,223		463
	$		157	Invesco Ltd	14,387		582
Building Materials - 1.16%				Lazard Ltd	62,580		3,080
CRH PLC ADR	185,200		4,151	NASDAQ OMX Group Inc/The	4,490		194
Owens Corning Inc	215,600		6,912	Navient Corp	660,943		13,073
				Raymond James Financial Inc	4,821		271


Schedule of Investments
MidCap Value Fund III
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Diversified Financial Services (continued)				Food (continued)
Santander Consumer USA Holdings Inc	4,829	$	89	JM Smucker Co/The	4,053	$	422
SLM Corp	562,700		5,374	Pilgrim's Pride Corp ^(a)	3,166		90
Synchrony Financial ^(a)	2,039		55	Pinnacle Foods Inc	3,136		106
	$		57,649	Safeway Inc	7,642		267
				Tyson Foods Inc	245,714		9,914
Electric - 6.41%				Whole Foods Market Inc	7,004		276
AES Corp/VA	24,466		344		$		11,849
Alliant Energy Corp	3,742		232
Ameren Corp	8,201		347	Forest Products & Paper - 0.12%
Calpine Corp ^(a)	12,268		280	Domtar Corp	3,940		162
CMS Energy Corp	14,471		473	International Paper Co	14,610		740
Consolidated Edison Inc	10,004		634	MeadWestvaco Corp	5,669		250
DTE Energy Co	5,974		491		$		1,152
Edison International	90,065		5,636
Entergy Corp	145,251		12,204	Gas - 3.09%
FirstEnergy Corp	14,339		535	AGL Resources Inc	209,234		11,280
Integrys Energy Group Inc	2,721		198	Atmos Energy Corp	4,308		228
MDU Resources Group Inc	6,426		181	CenterPoint Energy Inc	216,983		5,327
Northeast Utilities	10,788		532	National Fuel Gas Co	2,834		196
NRG Energy Inc	11,375		341	NiSource Inc	97,590		4,105
OGE Energy Corp	6,927		258	Questar Corp	5,919		143
Pepco Holdings Inc	8,466		232	Sempra Energy	8,320		915
Pinnacle West Capital Corp	157,131		9,659	UGI Corp	8,146		307
PPL Corp	474,731		16,611	Vectren Corp	173,880		7,816
Public Service Enterprise Group Inc	27,166		1,122		$		30,317
SCANA Corp	4,802		264	Hand & Machine Tools - 1.38%
TECO Energy Inc	7,868		154	Kennametal Inc	4,620		178
Westar Energy Inc	102,631		3,880	Lincoln Electric Holdings Inc	3,055		221
Wisconsin Energy Corp	7,623		379	Regal-Beloit Corp	2,687		191
Xcel Energy Inc	234,622		7,853	Snap-on Inc	1,889		250
	$		62,840	Stanley Black & Decker Inc	135,032		12,644
Electrical Components & Equipment - 0.05%					$		13,484
Energizer Holdings Inc	2,477		304	Healthcare - Products - 1.39%
Hubbell Inc	1,878		213	Boston Scientific Corp ^(a)	48,337		642
	$		517	CareFusion Corp ^(a)	7,009		402
Electronics - 0.24%				Cooper Cos Inc/The	710		116
Agilent Technologies Inc	11,524		637	DENTSPLY International Inc	3,927		199
Arrow Electronics Inc ^(a)	3,779		215	Hill-Rom Holdings Inc	3,108		138
				Hologic Inc ^(a)	6,375		167
Avnet Inc	4,183		181
AVX Corp	2,667		39	Hospira Inc	5,670		305
				QIAGEN NV ^(a)	9,427		221
FLIR Systems Inc	2,529		85	Sirona Dental Systems Inc ^(a)	1,272		100
Garmin Ltd	4,918		273
Gentex Corp/MI	3,582		117	St Jude Medical Inc	164,194		10,537
Jabil Circuit Inc	7,709		161	Techne Corp	1,092		99
Knowles Corp ^(a)	4,872		95	Teleflex Inc	1,396		159
PerkinElmer Inc	5,260		228	Zimmer Holdings Inc	5,264		586
Tech Data Corp ^(a)	2,254		135		$		13,671
Tyco International Ltd	2,898		124	Healthcare - Services - 2.95%
Vishay Intertechnology Inc	7,854		106	Cigna Corp	126,401		12,586
	$		2,396	Community Health Systems Inc ^(a)	3,864		212
				Covance Inc ^(a)	323		26
Engineering & Construction - 1.24%				DaVita HealthCare Partners Inc ^(a)	3,937		307
AECOM Technology Corp ^(a)	195,311		6,358
				HCA Holdings Inc ^(a)	11,929		836
Fluor Corp	2,336		155	Health Net Inc/CA ^(a)	156,281		7,425
Jacobs Engineering Group Inc ^(a)	5,093		242
KBR Inc	285,200		5,441	Humana Inc	6,250		868
				Laboratory Corp of America Holdings ^(a)	2,107		230
	$		12,196	LifePoint Hospitals Inc ^(a)	2,615		183
Entertainment - 0.67%				Mednax Inc ^(a)	2,074		130
Dolby Laboratories Inc	2,755		115	Quest Diagnostics Inc	5,835		370
International Game Technology	8,351		137	Universal Health Services Inc	54,945		5,698
SeaWorld Entertainment Inc	329,200		6,334		$		28,871

	$		6,586	Holding Companies - Diversified - 0.03%
Environmental Control - 0.06%				Leucadia National Corp	10,331		246
Clean Harbors Inc ^(a)	918		46
Republic Services Inc	10,027		385
Waste Connections Inc	2,790		139	Home Builders - 0.10%
				DR Horton Inc	9,779		223
	$		570	Lennar Corp	6,534		281
Food - 1.21%				Pulte Group Inc	14,378		276
ConAgra Foods Inc	16,226		557	Toll Brothers Inc ^(a)	5,717		183
Hain Celestial Group Inc ^(a)	243		26		$		963
Ingredion Inc	2,477		191


Schedule of Investments
MidCap Value Fund III
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Home Furnishings - 0.46%				Machinery - Construction & Mining - 1.18%
Harman International Industries Inc	36,130	$	3,878	Joy Global Inc	216,876	$	11,415
Leggett & Platt Inc	4,046		159	Terex Corp	6,339		182
Whirlpool Corp	2,799		482		$		11,597

	$		4,519	Machinery - Diversified - 0.35%
Housewares - 0.02%				AGCO Corp	3,735		166
Newell Rubbermaid Inc	6,455		215	IDEX Corp	309		23
				Roper Industries Inc	1,852		293

Insurance - 5.69%				Xylem Inc/NY	81,214		2,953
Alleghany Corp ^(a)	557		247		$		3,435
Allied World Assurance Co Holdings AG	5,681		216	Media - 0.62%
American Financial Group Inc/OH	3,490		209	DISH Network Corp ^(a)	3,281		209
American National Insurance Co	425		49	Gannett Co Inc	8,601		271
Aon PLC	2,665		229	John Wiley & Sons Inc	2,715		158
Arch Capital Group Ltd ^(a)	5,264		296	Liberty Media Corp - A shares ^(a)	3,345		161
Aspen Insurance Holdings Ltd	116,398		5,079	Liberty Media Corp - C shares ^(a)	6,414		307
Assurant Inc	2,934		200	Meredith Corp	86,200		4,494
Assured Guaranty Ltd	9,723		224	News Corp ^(a)	16,810		260
Axis Capital Holdings Ltd	4,231		204	Nielsen NV	4,111		175
Cincinnati Financial Corp	6,403		323	Starz ^(a)	731		23
CNA Financial Corp	1,475		58		$		6,058
Endurance Specialty Holdings Ltd	2,574		149
Everest Re Group Ltd	70,807		12,083	Metal Fabrication & Hardware - 0.05%
Genworth Financial Inc ^(a)	552,590		7,731	Timken Co/The	4,479		193
Hanover Insurance Group Inc/The	2,539		170	TimkenSteel Corp	2,252		91
Hartford Financial Services Group Inc/The	17,654		699	Valmont Industries Inc	1,477		201
HCC Insurance Holdings Inc	3,870		202		$		485
Lincoln National Corp	208,074		11,394	Mining - 0.12%
Loews Corp	10,918		476	Alcoa Inc	46,793		784
Markel Corp ^(a)	469		324
MBIA Inc ^(a)	8,111		79	Newmont Mining Corp	16,755		314
				Royal Gold Inc	2,186		125
Mercury General Corp	1,543		82		$		1,223
Old Republic International Corp	15,397		227
PartnerRe Ltd	51,237		5,927	Miscellaneous Manufacturing - 2.30%
Progressive Corp/The	23,240		614	AO Smith Corp	2,409		129
Protective Life Corp	3,096		216	Carlisle Cos Inc	2,316		206
Reinsurance Group of America Inc	1,931		163	Crane Co	1,782		111
RenaissanceRe Holdings Ltd	1,531		158	Donaldson Co Inc	710		30
StanCorp Financial Group Inc	2,543		177	Dover Corp	2,598		207
Torchmark Corp	5,172		274	Eaton Corp PLC	147,000		10,053
Unum Group	10,105		338	Ingersoll-Rand PLC	9,361		586
Validus Holdings Ltd	5,001		199	ITT Corp	4,133		186
Voya Financial Inc	5,645		222	Parker-Hannifin Corp	2,632		334
Willis Group Holdings PLC	147,500		5,978	Pentair PLC	6,821		457
WR Berkley Corp	3,888		200	SPX Corp	103,080		9,771
XL Group PLC	10,658		361	Textron Inc	10,531		437
	$		55,777	Trinity Industries Inc	2,090		75
					$		22,582
Internet - 0.13%
AOL Inc ^(a)	4,725		206	Office & Business Equipment - 0.46%
IAC/InterActiveCorp	2,508		170	Pitney Bowes Inc	6,807		168
Liberty Interactive Corp ^(a)	8,323		217	Xerox Corp	326,291		4,333
Symantec Corp	26,100		648		$		4,501

	$		1,241	Oil & Gas - 4.22%
Iron & Steel - 0.36%				Atwood Oceanics Inc	2,897		118
Nucor Corp	12,397		670	Chesapeake Energy Corp	15,528		344
Reliance Steel & Aluminum Co	2,999		203	Cimarex Energy Co	24,136		2,743
Steel Dynamics Inc	9,838		226	CVR Energy Inc	541		26
United States Steel Corp	61,923		2,479	Denbury Resources Inc	14,172		176
	$		3,578	Diamond Offshore Drilling Inc	3,851		145
				Energen Corp	2,742		186
Leisure Products & Services - 1.11%				EP Energy Corp ^(a)	1,892		28
Jarden Corp ^(a)	3,399		221
				Helmerich & Payne Inc	59,599		5,174
Royal Caribbean Cruises Ltd	157,350		10,695	HollyFrontier Corp	6,141		279
	$		10,916	Murphy Oil Corp	129,515		6,915
				Murphy USA Inc ^(a)	81,452		4,667
Lodging - 0.50%
Choice Hotels International Inc	1,885		101	Nabors Industries Ltd	10,262		183
Hyatt Hotels Corp ^(a)	68,960		4,084	Newfield Exploration Co ^(a)	5,228		170
Marriott International Inc/DE	1,503		114	Noble Energy Inc	3,965		229
MGM Resorts International ^(a)	11,572		269	Patterson-UTI Energy Inc	93,923		2,163
Starwood Hotels & Resorts Worldwide Inc	4,018		308	PBF Energy Inc	2,732		71
	$		4,876	QEP Resources Inc	9,005		226
				Rowan Cos PLC	7,280		177


Schedule of Investments
MidCap Value Fund III
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Oil & Gas (continued)				REITS (continued)
Seadrill Ltd	146,230	$	3,363	Liberty Property Trust	5,689	$	198
Seventy Seven Energy Inc ^(a)	1,656		22	Macerich Co/The	5,382		379
Tesoro Corp	148,823		10,628	MFA Financial Inc	21,078		177
Ultra Petroleum Corp ^(a)	6,152		140	Mid-America Apartment Communities Inc	2,887		204
Unit Corp ^(a)	2,700		131	National Retail Properties Inc	4,743		181
Whiting Petroleum Corp ^(a)	47,540		2,911	Omega Healthcare Investors Inc	131,872		5,032
WPX Energy Inc ^(a)	6,942		133	Piedmont Office Realty Trust Inc	9,233		180
	$		41,348	Post Properties Inc	3,260		182
				Prologis Inc	19,445		810
Oil & Gas Services - 0.07%				Realty Income Corp	8,530		393
Cameron International Corp ^(a)	2,829		168
				Regency Centers Corp	3,556		216
Frank's International NV	1,759		30	Senior Housing Properties Trust	7,496		169
MRC Global Inc ^(a)	3,215		68
Oil States International Inc ^(a)	2,705		162	SL Green Realty Corp	51,573		5,967
				Spirit Realty Capital Inc	13,457		160
Superior Energy Services Inc	8,365		210	Starwood Property Trust Inc	8,786		198
	$		638	Tanger Factory Outlet Centers Inc	1,965		70
Packaging & Containers - 0.07%				Two Harbors Investment Corp	20,979		212
Bemis Co Inc	3,926		151	UDR Inc	454,577		13,742
Owens-Illinois Inc ^(a)	4,046		104	Ventas Inc	5,928		406
Rock-Tenn Co	4,854		248	Vornado Realty Trust	5,550		608
Sonoco Products Co	3,956		162	Washington Prime Group Inc	8,922		157
	$		665	Weingarten Realty Investors	4,743		172
				Weyerhaeuser Co	18,138		614
Pharmaceuticals - 5.49%					$		101,526
Cardinal Health Inc	388,502		30,489
Mallinckrodt PLC ^(a)	81,490		7,512	Retail - 4.59%
Omnicare Inc	223,777		14,902	Abercrombie & Fitch Co	3,577		120
Perrigo Co PLC	3,471		560	Bed Bath & Beyond Inc ^(a)	4,469		301
Quintiles Transnational Holdings Inc ^(a)	1,724		101	Best Buy Co Inc	7,634		261
VCA Inc ^(a)	5,226		238	Big Lots Inc	95,421		4,356
	$		53,802	CST Brands Inc	638		24
				Darden Restaurants Inc	4,434		230
Pipelines - 0.02%				Dick's Sporting Goods Inc	4,603		209
ONEOK Inc	3,750		221	Dillard's Inc	63,867		6,755
				Dollar General Corp ^(a)	2,812		176
Real Estate - 0.66%				DSW Inc	4,330		128
Jones Lang LaSalle Inc	46,228		6,250	Foot Locker Inc	175,885		9,851
WP Carey Inc	3,796		257	GameStop Corp	4,120		176
	$		6,507	Kohl's Corp	7,484		406
				L Brands Inc	171,634		12,378
REITS - 10.36%				Macy's Inc	149,401		8,638
Alexandria Real Estate Equities Inc	2,856		237	Penske Automotive Group Inc	1,364		62
American Campus Communities Inc	4,073		160	PVH Corp	584		67
American Capital Agency Corp	12,289		279	Rite Aid Corp ^(a)	18,512		97
American Realty Capital Properties Inc	30,443		270	Sally Beauty Holdings Inc ^(a)	2,416		71
Annaly Capital Management Inc	32,484		371	Signet Jewelers Ltd	1,454		175
AvalonBay Communities Inc	4,953		772	Staples Inc	24,524		311
BioMed Realty Trust Inc	7,357		160	Urban Outfitters Inc ^(a)	1,758		53
Boston Properties Inc	4,553		577	Wendy's Co/The	4,400		35
Brandywine Realty Trust	9,287		143	World Fuel Services Corp	3,261		134
Camden Property Trust	3,283		252		$		45,014
CBL & Associates Properties Inc	9,569		183
Chimera Investment Corp	61,378		191	Savings & Loans - 2.20%
Columbia Property Trust Inc	6,104		154	First Niagara Financial Group Inc	661,535		4,954
Corporate Office Properties Trust	194,170		5,309	Hudson City Bancorp Inc	17,683		171
Corrections Corp of America	3,924		144	New York Community Bancorp Inc	537,580		8,575
DDR Corp	11,590		210	People's United Financial Inc	537,882		7,864
Digital Realty Trust Inc ^(b)	5,205		359		$		21,564
Douglas Emmett Inc	5,580		157	Semiconductors - 1.30%
Duke Realty Corp	758,945		14,390	Altera Corp	6,620		227
Equity Commonwealth ^(a)	7,061		189
				Analog Devices Inc	5,766		286
Equity LifeStyle Properties Inc	158,366		7,776	Applied Materials Inc	15,473		342
Essex Property Trust Inc	33,975		6,855	Broadcom Corp	20,283		849
Extra Space Storage Inc	78,880		4,588	First Solar Inc ^(a)	2,752		162
Federal Realty Investment Trust	1,335		176	KLA-Tencor Corp	848		67
General Growth Properties Inc	150,828		3,908	Lam Research Corp	4,542		354
HCP Inc	17,718		779	Marvell Technology Group Ltd	15,389		207
Health Care REIT Inc	5,937		422	Maxim Integrated Products Inc	1,330		39
Home Properties Inc	3,378		217	Microchip Technology Inc	161,600		6,967
Hospitality Properties Trust	5,937		176	Micron Technology Inc ^(a)	74,010		2,449
Host Hotels & Resorts Inc	903,584		21,063	NVIDIA Corp	17,968		351
Iron Mountain Inc	1,069		38	ON Semiconductor Corp ^(a)	12,381		103
Kilroy Realty Corp	2,788		189	Rovi Corp ^(a)	5,601		117
Kimco Realty Corp	16,219		405


Schedule of Investments
MidCap Value Fund III
October 31, 2014



COMMON STOCKS (continued)		Shares Held	Value(000			's)	Portfolio Summary (unaudited)
							Sector	Percent
Semiconductors (continued)							Financial	31.96	%
Teradyne Inc		10,058		$	185		Consumer, Non-cyclical	15.45	%
			$		12,705		Consumer, Cyclical	12.36	%
Shipbuilding - 0.00%							Industrial	10.79	%
Huntington Ingalls Industries Inc		437			46		Utilities	9.55	%
							Technology	8.35	%
							Energy	4.34	%
Software - 2.51%							Exchange Traded Funds	3.59	%
Activision Blizzard Inc		541,254			10,798		Basic Materials	2.40	%
ANSYS Inc ^(a)		2,688			211
Autodesk Inc ^(a)		2,761			159		Communications	0.89	%
							Diversified	0.03	%
CA Inc		421,871			12,260		Other Assets in Excess of Liabilities, Net	0.29	%
Citrix Systems Inc ^(a)		896			57
Dun & Bradstreet Corp/The		1,367			168		TOTAL NET ASSETS	100.00	%
Electronic Arts Inc ^(a)		4,122			169
Fidelity National Information Services Inc		9,523			556
Informatica Corp ^(a)		632			22
Nuance Communications Inc ^(a)		8,796			136
Paychex Inc		2,065			97
			$		24,633

Telecommunications - 0.14%
EchoStar Corp ^(a)		1,922			90
Frontier Communications Corp		38,748			253
Harris Corp		3,211			224
Juniper Networks Inc		14,068			297
Level 3 Communications Inc ^(a)		664			31
Motorola Solutions Inc		5,882			379
Telephone & Data Systems Inc		5,008			128
Windstream Holdings Inc		1,800			19
			$		1,421

Textiles - 0.03%
Mohawk Industries Inc ^(a)		2,083			296


Toys, Games & Hobbies - 0.03%
Hasbro Inc		1,039			60
Mattel Inc		7,301			227
			$		287

Transportation - 0.74%
Con-way Inc		3,353			145
Golar LNG Ltd		122,700			6,885
Ryder System Inc		1,800			159
Tidewater Inc		2,887			107
			$		7,296

Trucking & Leasing - 0.02%
AMERCO		188			51
GATX Corp		2,756			175
			$		226

Water - 0.05%
American Water Works Co Inc		6,049			323
Aqua America Inc		5,986			157
			$		480
TOTAL COMMON STOCKS			$		942,284
INVESTMENT COMPANIES - 3.59%		Shares Held	Value(000			's)

Publicly Traded Investment Fund - 3.59%
BlackRock Liquidity Funds FedFund Portfolio		505,855			506
BlackRock Liquidity Funds TempFund		30,675,858			30,676
Portfolio
Goldman Sachs Financial Square Funds -		3,741,460			3,741
Money Market Fund
JP Morgan Prime Money Market Fund		273,144			273
			$		35,196
TOTAL INVESTMENT COMPANIES			$		35,196
Total Investments			$		977,480
Other Assets in Excess of Liabilities, Net - 0.29%			$		2,814
TOTAL NET ASSETS - 100.00%			$		980,294

(a)	Non-Income Producing Security
(b)	Security is Illiquid


Schedule of Investments
Money Market Fund
October 31, 2014



	INVESTMENT COMPANIES - 5.76%			Shares Held		Value (000's)				Principal
							BONDS (continued)			Amount (000's)		Value (000's)
	Publicly Traded Investment Fund - 5.76%
	Deutsche Money Market Series			19,980,000	$	19,980	Other Asset Backed Securities (continued)
	Morgan Stanley Institutional Liquidity Funds -			20,000,000		20,000	GE Equipment Midticket LLC Series 2014-1
	Government Portfolio						0.20%, 09/22/2015 ^(a)		$	2,129	$	2,129
	STIT - Liquid Assets Portfolio			22,200,000		22,200	GE Equipment Small Ticket LLC Series 2014-
				$		62,180	1
	TOTAL INVESTMENT COMPANIES			$		62,180	0.25%, 04/24/2015 ^(a),(b)			1,412		1,412
				Principal			GE Equipment Transportation LLC Series
	BONDS- 13.11	%		Amount (000's)	Value (000's)		2014-1
							0.20%, 06/23/2015 ^(a)			2,944		2,944
	Automobile Asset Backed Securities - 5.13%						GreatAmerica Leasing Receivables
	Ally Auto Receivables Trust 2014-2						0.25%, 03/15/2015 ^(a),(b)			1,008		1,008
	0.20%, 10/15/2015 ^(a)		$	5,477	$	5,477	Macquarie Equipment Funding Trust 2014-A
	Ally Auto Receivables Trust 2014-SN2						0.26%, 09/21/2015 ^(b)			5,071		5,071
	0.25%, 10/20/2015 ^(a)			6,500		6,500	Volvo Financial Equipment LLC Series 2014-
	AmeriCredit Automobile Receivables Trust						1
	2014-2						0.21%, 03/16/2015 ^(b)			1,138		1,138
	0.21%, 06/08/2015 ^(a)			1,893		1,893				$		19,711
	ARI Fleet Lease Trust 2014-A						TOTAL BONDS			$		141,565
	0.25%, 04/15/2015 ^(a),(b)			1,764		1,764
										Principal
	Chrysler Capital Auto Receivables Trust 2014-						MUNICIPAL BONDS - 5.15%			Amount (000's)		Value (000's)
	B
	0.20%, 10/15/2015 ^(a),(b)			7,615		7,615	California - 0.45%
	Enterprise Fleet Financing LLC						California Statewide Communities
	0.25%, 08/20/2015 ^(b)			2,945		2,945	Development Authority (credit support from
	GM Financial Automobile Leasing Trust						Fannie Mae)
	2014-2						0.11%, 11/07/2014 ^(d)		$	100	$	100
	0.25%, 09/21/2015 ^(b)			1,796		1,796	Kern Water Bank Authority (credit support
	Mercedes Benz Auto Lease Trust 2014-A						from Wells Fargo)
	0.20%, 04/15/2015 ^(a)			1,041		1,041	0.15%, 11/07/2014 ^(d)			4,700		4,700
	Nissan Auto Lease Trust 2014-B									$		4,800
	0.20%, 10/15/2015 ^(a)			7,100		7,100
							Colorado - 1.39%
	Santander Drive Auto Receivables Trust 2014-						City of Colorado Springs CO Utilities System
	2
	0.25%, 05/15/2015 ^(a)			617		617	Revenue (credit support from Bank of
							America)
	Volkswagen Auto Loan Enhanced Trust 2014-						0.15%, 11/07/2014 ^(d)			6,100		6,100
	2
	0.20%, 10/20/2015 ^(a)			6,500		6,500	Colorado Housing & Finance
							Authority (credit support from Federal Home

	Wheels SPV 2 LLC						Loan Bank)
	0.24%, 05/20/2015 (a),(b)			2,408		2,407	0.09%, 11/07/2014 ^(a),(d)			7,610		7,610
	World Omni Auto Receivables Trust 2014-B						County of Kit Carson CO (credit support from
	0.23%, 11/16/2015			4,800		4,800	Wells Fargo)
	World Omni Automobile Lease Securitization						0.09%, 11/07/2014 ^(d)			1,280		1,280
	Trust 2014-A
	0.20%, 10/09/2015			4,969		4,969				$		14,990
				$		55,424	Illinois - 1.15%
							Memorial Health System/IL (credit support
	Banks- 1.41	%					from JP Morgan Chase & Co)
	JP Morgan Chase Bank NA						0.09%, 11/07/2014 ^(d)			12,405		12,405
	0.42%, 12/21/2014 ^(a)			8,000		8,000
	Wells Fargo Bank NA
	0.37%, 11/20/2015 ^(a)			7,200		7,200	Indiana - 0.29%
				$		15,200	Ball State University Foundation Inc (credit
							support from US Bank)
	Diversified Financial Services - 2.34%						0.10%, 11/03/2014 ^(d)			3,150		3,150
	Corporate Finance Managers Inc
	0.15%, 11/07/2014 ^(a)			10,250		10,250
	MetLife Inc						Iowa- 0.23	%
	0.30%, 08/17/2015 ^(a),(c)			15,000		15,000	Iowa Finance Authority (credit support from
				$		25,250	GNMA/FNMA/FHLMC)
							0.11%, 11/07/2014 ^(d)			2,500		2,500
	Healthcare - Services - 0.92%
	Portland Clinic LLP/The
	0.11%, 11/07/2014 ^(a)			9,980		9,980	Maryland - 0.43%
							City of Baltimore MD (credit support from
							State Street Bank & Trust)
	Insurance - 1.48%						0.09%, 11/07/2014 ^(d)			4,600		4,600
	New York Life Global
	0.22%, 07/24/2015 ^(a),(c)			16,000		16,000
							Minnesota - 0.46%
							City of St Paul MN (credit support from US
	Other Asset Backed Securities - 1.83%						Bank)
	CNH Equipment Trust 2014-A						0.15%, 11/07/2014 ^(d)			5,000		5,000
	0.20%, 02/17/2015 ^(a)			1,872		1,872
	Dell Equipment Finance Trust 2014-1
	0.26%, 08/14/2015 ^(b)			4,137		4,137


Schedule of Investments
Money Market Fund
October 31, 2014



				Principal					Principal
	MUNICIPAL BONDS (continued)			Amount (000's)	Value (000's)		COMMERCIAL PAPER (continued)		Amount (000's)	Value (000's)

	New Mexico - 0.39%						Banks (continued)
	City of Las Cruces NM (credit support from						Skandinaviska Enskilda Banken AB
	Wells Fargo)						0.15%, 12/29/2014 ^(b),(e)	$	6,000	$	5,999
	0.15%, 11/07/2014 ^(d)		$	4,200	$	4,200	0.20%, 11/17/2014 ^(b),(e)		8,000		7,999
							0.22%, 01/08/2015 ^(b),(e)		5,000		4,998
							0.23%, 12/01/2014 ^(b),(e)		8,000		7,999
	Oklahoma - 0.33%						Societe Generale SA
	Oklahoma University Hospital (credit support						0.19%, 12/31/2014 ^(b),(e)		8,500		8,497
	from Bank of America)
	0.12%, 11/07/2014 ^(d)			3,600		3,600	Standard Chartered Bank/New York
							0.19%, 11/13/2014 ^(b)		8,400		8,399
							0.21%, 02/17/2015 ^(b)		8,000		7,995
	Washington - 0.03%						0.23%, 12/18/2014 ^(b)		8,880		8,877
	Washington State Housing Finance						Sumitomo Mitsui Banking Corp
	Commission (credit support from Fannie						0.15%, 12/30/2014 ^(b),(e)		7,500		7,498
	Mae)						0.20%, 12/09/2014 ^(b),(e)		4,000		3,999
	0.13%, 11/07/2014 ^(d)			320		320	0.21%, 12/05/2014 ^(b),(e)		8,000		7,998
							0.22%, 12/10/2014 ^(b),(e)		7,000		6,998
	TOTAL MUNICIPAL BONDS			$		55,565			$		266,321

				Principal			Consumer Products - 1.22%
	COMMERCIAL PAPER - 68.53%			Amount (000's))	Value (000's		Reckitt Benckiser Treasury Services
	Agriculture - 0.31%						PLC (credit support from Reckitt Benckiser
	Archer-Daniels-Midland Co						Group)
	0.07%, 12/08/2014 ^(b)		$	2,000	$	2,000	0.21%, 12/04/2014 ^(b),(d)		5,450		5,449
	Philip Morris International Inc						0.22%, 11/25/2014 ^(b),(d)		7,700		7,699
	0.12%, 11/13/2014 ^(b)			1,350		1,350			$		13,148

				$		3,350	Diversified Financial Services - 26.11%
	Automobile Manufacturers - 0.74%						Alpine Securitization Corp
	BMW US Capital LLC (credit support from						0.19%, 11/07/2014 ^(b)		4,000		4,000
	BMW AG)						0.19%, 11/12/2014 ^(b)		7,900		7,900
	0.08%, 11/04/2014 ^(b),(d)			8,000		8,000	0.23%, 11/13/2014 ^(b)		4,511		4,511
							0.26%, 02/04/2015 ^(b)		8,500		8,494
							Anglesea Funding LLC
	Banks- 24.67	%					0.14%, 11/03/2014 ^(b)		7,800		7,800
	Bank of Tokyo-Mitsubishi UFJ Ltd/New York						AXA Financial Inc (credit support from AXA
	NY						SA)
	0.19%, 01/06/2015			7,000		6,998	0.20%, 12/01/2014 ^(b),(d)		5,000		4,999
	0.20%, 12/03/2014			5,000		4,999	BNP Paribas Finance Inc (credit support from
	Barclays Bank PLC						BNP Paribas)
	0.19%, 12/11/2014			8,000		7,998	0.18%, 11/14/2014 ^(d)		7,800		7,799
	0.22%, 01/09/2015			7,200		7,197	0.22%, 11/26/2014 ^(d)		7,000		6,999
	Credit Suisse/New York NY						0.22%, 12/02/2014 ^(d)		7,000		6,999
	0.22%, 11/05/2014			6,900		6,900	CAFCO LLC
	0.22%, 12/17/2014			5,500		5,498	0.17%, 11/03/2014 ^(b)		7,600		7,600
	0.22%, 12/23/2014			8,000		7,997	Collateralized Commercial Paper Co LLC
	0.26%, 11/14/2014			5,000		5,000	0.15%, 01/05/2015		10,000		9,997
	DNB Bank ASA						0.20%, 11/24/2014		9,000		8,999
	0.15%, 12/29/2014 ^(b),(e)			7,500		7,498
	0.20%, 01/16/2015 ^(b),(e)			7,000		6,997	Collateralized Commercial Paper II Co LLC
							0.25%, 11/24/2014 ^(b)		8,000		7,999
	0.22%, 01/05/2015 ^(b),(e)			8,000		7,997
							Dealers Capital Access Trust Inc
	HSBC USA Inc						0.20%, 11/07/2014		8,000		8,000
	0.20%, 01/22/2015			5,300		5,298	0.20%, 11/19/2014		6,400		6,399
	Manhattan Asset Funding Co LLC						0.21%, 12/08/2014		7,000		6,998
	0.13%, 11/04/2014 ^(b)			6,900		6,900
	0.15%, 12/02/2014 ^(b)			3,000		3,000	0.25%, 11/03/2014		5,000		5,000
	0.16%, 11/19/2014 ^(b)			8,000		7,999	Fairway Finance LLC
							0.10%, 11/10/2014 ^(b)		6,000		6,000
	0.18%, 12/04/2014 ^(b)			8,000		7,999
							Gemini Securitization Corp LLC
	Mitsubishi UFJ Trust & Banking Corp/NY						0.18%, 11/07/2014 ^(b)		8,000		8,000
	0.20%, 12/29/2014 ^(b)			7,500		7,498
							Gotham Funding Corp
	Mizuho Funding LLC (credit support from						0.14%, 11/20/2014 ^(b)		5,000		5,000
	Mizuho Corp Bank Ltd)						0.15%, 11/06/2014 ^(b)		8,000		8,000
	0.20%, 11/04/2014 ^(b),(d)			7,000		7,000
							0.15%, 12/08/2014 ^(b)		6,000		5,999
	0.20%, 11/21/2014 ^(b),(d)			7,500		7,499
							0.16%, 11/21/2014 ^(b)		7,400		7,399
	0.21%, 02/18/2015 ^(b),(d)			8,000		7,995
							ING US Funding LLC (credit support from
	MUFG Union Bank NA						ING Bank)
	0.07%, 11/04/2014			8,000		8,000	0.20%, 02/02/2015 ^(d)		8,000		7,996
	0.08%, 11/03/2014			6,000		6,000	0.23%, 11/10/2014 ^(d)		8,000		7,999
	0.08%, 11/05/2014			7,800		7,800	0.29%, 02/20/2015 ^(d)		8,000		7,993
	Nordea Bank AB						John Deere Financial Inc (credit support from
	0.18%, 11/03/2014 ^(b),(e)			8,000		8,000
							John Deere Capital Corp)
	Oversea-Chinese Banking Corp Ltd						0.08%, 11/18/2014 ^(b),(d)		8,000		8,000
	0.19%, 11/13/2014 ^(e)			6,000		6,000
	0.23%, 12/19/2014 ^(e)			7,000		6,998	JP Morgan Securities LLC
							0.15%, 11/12/2014		7,900		7,900


Schedule of Investments
Money Market Fund
October 31, 2014



				Principal						Principal
	COMMERCIAL PAPER (continued)			Amount (000's)	Value (000's)		COMMERCIAL PAPER (continued)		Amount (000's)		Value(000			's)

	Diversified Financial Services (continued)						REITS - 0.65%
	JP Morgan Securities LLC (continued)						Simon Property Group LP
	0.20%, 11/17/2014 ^(b)		$	8,000	$	7,999		0.14%, 12/22/2014 ^(b)	$	7,000		$	6,999
	Liberty Street Funding LLC
	0.17%, 01/20/2015 ^(b)			7,000		6,997
	0.18%, 12/10/2014 ^(b)			8,000		7,998	Retail - 1.48%
							Army and Air Force Exchange Service
	National Rural Utilities Cooperative Finance							0.06%, 11/03/2014 ^(b)		16,000			16,000
	Corp
	0.09%, 11/28/2014			7,000		6,999
	Nieuw Amsterdam Receivables Corp						Supranational Bank - 0.63%
	0.12%, 11/05/2014 ^(b)			1,230		1,230	Corp Andina de Fomento
	0.17%, 01/08/2015 ^(b)			3,000		2,999		0.24%, 11/14/2014 ^(b)		6,800			6,799
	Sheffield Receivables Corp
	0.14%, 12/12/2014 ^(b)			7,000		6,999
	0.18%, 11/12/2014 ^(b)			8,000		8,000	Telecommunications - 1.96%
	0.18%, 11/18/2014 ^(b)			7,000		6,999	Telstra Corp Ltd
								0.16%, 01/09/2015 ^(b)		7,420			7,418
	0.22%, 02/03/2015 ^(b)			4,000		3,998
								0.20%, 03/16/2015 ^(b)		7,000			6,995
	Thunder Bay Funding LLC							0.22%, 03/23/2015 ^(b)		6,800			6,794
	0.12%, 11/25/2014 ^(b)			5,600		5,600
	Toyota Credit Canada Inc (credit support										$		21,207
	from Toyota Financial Services)						TOTAL COMMERCIAL PAPER				$		739,988
	0.17%, 11/19/2014 ^(d)			7,900		7,899				Principal
	0.17%, 11/20/2014 ^(d)			7,400		7,399	CERTIFICATE OF DEPOSIT - 3.29%		Amount (000's)				Value(000	's)
				$		281,895	Banks - 3.29%
	Electric - 3.69%						Bank of America NA
	GDF Suez							0.18%, 12/16/2014		6,700			6,700
	0.14%, 12/03/2014 ^(b)			6,400		6,399		0.20%, 12/11/2014		9,000			9,000
	0.14%, 12/16/2014 ^(b)			6,500		6,499		0.20%, 12/12/2014		7,000			7,000
	0.15%, 12/19/2014 ^(b)			6,100		6,099	Bank of Nova Scotia/Houston
								0.39%, 11/11/2015 ^(a),(e)		5,800			5,800
	0.21%, 11/18/2014 ^(b)			7,900		7,899
	Oglethorpe Power Corp						Citibank NA
	0.17%, 12/15/2014 ^(b)			6,986		6,984		0.19%, 02/23/2015		7,000			7,000
	0.17%, 01/12/2015 ^(b)			6,000		5,998					$		35,500
				$		39,878	TOTAL CERTIFICATE OF DEPOSIT				$		35,500
										Maturity
	Electrical Components & Equipment - 0.64%						REPURCHASE AGREEMENTS - 4.47%		Amount (000's)		Value (000			's)
	Emerson Electric Co
	0.09%, 12/26/2014 ^(b)			6,900		6,899	Banks - 4.47%
							Merrill Lynch Repurchase Agreement; 0.08%		$	48,240	$		48,240
								dated 10/31/2014 maturing 11/03/2014
	Food- 0.69	%						(collateralized by US Government
	Unilever Capital Corp (credit support from							Securities; $49,204,800; 0.00% - 2.25%;
	Unilever PLC)							dated 03/31/16 - 08/15/21)
	0.05%, 11/06/2014 ^(b),(d)			7,500		7,500
							TOTAL REPURCHASE AGREEMENTS				$		48,240
	Insurance - 2.78%						Total Investments				$		1,083,038
	Prudential Funding LLC (credit support from						Liabilities in Excess of Other Assets, Net - (0.31)%				$		(3,315	)
	Prudential Financial Inc)						TOTAL NET ASSETS - 100.00%				$		1,079,723
	0.06%, 11/07/2014 ^(d)			7,000		7,000
	Prudential PLC
	0.15%, 12/15/2014 ^(b)			8,000		7,998	(a)	Variable Rate. Rate shown is in effect at October 31, 2014.
	0.15%, 01/07/2015 ^(b)			7,000		6,998	(b)	Security exempt from registration under Rule 144A of the Securities Act of
	0.18%, 02/17/2015 ^(b)			5,000		4,997		1933. These securities may be resold in transactions exempt from
	0.21%, 01/15/2015 ^(b)			3,000		2,999		registration, normally to qualified institutional buyers. Unless otherwise
				$		29,992		indicated, these securities are not considered illiquid. At the end of the
								period, the value of these securities totaled $548,223 or 50.77% of net
	Miscellaneous Manufacturing - 2.12%							assets.
	Dover Corp						(c)	Security is Illiquid
	0.08%, 11/03/2014 ^(b)			16,000		16,000	(d)	Credit support indicates investments that benefit from credit enhancement
	0.09%, 11/03/2014 ^(b)			6,900		6,900		or liquidity support provided by a third party bank, institution, or
								government agency.
	Oil & Gas - 0.63%						(e)	Security issued by foreign bank and denominated in USD.
	BP Capital Markets PLC (credit support from
	BP PLC)
	0.10%, 11/07/2014 ^(b),(d)			6,800		6,800


	Pipelines - 0.21%
	Questar Corp
	0.14%, 11/12/2014 ^(b)			2,300		2,300


Schedule of Investments
Principal Capital Appreciation Fund
October 31, 2014



COMMON STOCKS - 97.77%	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Aerospace & Defense - 2.21%				Cosmetics & Personal Care - 0.82%
Boeing Co/The	232,167	$	29,000	Procter & Gamble Co/The	233,885	$	20,411
Northrop Grumman Corp	93,792		12,939
Teledyne Technologies Inc ^(a)	127,479		13,211
				Distribution & Wholesale - 0.44%
	$		55,150	Pool Corp	182,998		10,925
Airlines - 0.36%
Alaska Air Group Inc	103,704		5,520	Diversified Financial Services - 3.60%
Cathay Pacific Airways Ltd ADR	378,085		3,509	Ameriprise Financial Inc	87,749		11,071
	$		9,029	Charles Schwab Corp/The	925,204		26,526
Apparel - 2.12%				FNF Group	368,414		10,993
Nike Inc	429,469		39,928	Franklin Resources Inc	528,052		29,365
Ralph Lauren Corp	79,015		13,025	T Rowe Price Group Inc	144,519		11,864
	$		52,953		$		89,819

Automobile Manufacturers - 1.02%				Electric - 1.09%
Nissan Motor Co Ltd ADR	113,828		2,100	Duke Energy Corp	114,158		9,378
PACCAR Inc	357,849		23,375	Edison International	174,725		10,935
	$		25,475	Xcel Energy Inc	206,491		6,911
					$		27,224
Automobile Parts & Equipment - 1.31%
Autoliv Inc	130,119		11,937	Electronics - 2.32%
Johnson Controls Inc	436,997		20,648	FEI Co	78,318		6,601
	$		32,585	FLIR Systems Inc	116,841		3,918
				Thermo Fisher Scientific Inc	141,967		16,691
Banks - 7.08%				Trimble Navigation Ltd ^(a)	273,427		7,344
City National Corp/CA	136,082		10,711	Waters Corp ^(a)	210,654		23,340
East West Bancorp Inc	309,377		11,373		$		57,894
Goldman Sachs Group Inc/The	65,872		12,515
JP Morgan Chase & Co	467,433		28,270	Engineering & Construction - 0.62%
PNC Financial Services Group Inc/The	201,179		17,380	Granite Construction Inc	152,429		5,626
				Jacobs Engineering Group Inc ^(a)	206,560		9,801
State Street Corp	129,070		9,740
SVB Financial Group ^(a)	113,005		12,656		$		15,427
US Bancorp/MN	560,683		23,885	Environmental Control - 0.53%
Wells Fargo & Co	942,708		50,048	Waste Connections Inc	263,240		13,136
	$		176,578

Beverages - 1.80%				Food - 2.61%
AMBEV SA ADR	759,102		5,071	Dairy Farm International Holdings Ltd ADR	159,187		7,641
Brown-Forman Corp	128,694		11,926	Darling Ingredients Inc ^(a)	112,629		1,982
Coca-Cola Co/The	463,073		19,394	General Mills Inc	258,006		13,406
PepsiCo Inc	89,087		8,567	Kroger Co/The	358,898		19,994
	$		44,958	McCormick & Co Inc/MD	162,817		11,515
Biotechnology - 1.23%				Whole Foods Market Inc	265,392		10,438
Gilead Sciences Inc ^(a)	273,783		30,664		$		64,976
				Gas - 1.68%
Building Materials - 0.59%				Sempra Energy	381,494		41,964
Apogee Enterprises Inc	251,725		11,051
Simpson Manufacturing Co Inc	106,816		3,533	Healthcare - Products - 2.12%
	$		14,584	Becton Dickinson and Co	119,593		15,391
				Edwards Lifesciences Corp ^(a)	98,782		11,945
Chemicals - 2.40%
Axiall Corp	111,443		4,491	Medtronic Inc	104,426		7,118
				Techne Corp	100,387		9,140
EI du Pont de Nemours & Co	240,755		16,648	Varian Medical Systems Inc ^(a)	110,713		9,313
FMC Corp	175,485		10,064
International Flavors & Fragrances Inc	152,698		15,140		$		52,907
PPG Industries Inc	66,709		13,588	Healthcare - Services - 1.28%
	$		59,931	DaVita HealthCare Partners Inc ^(a)	190,551		14,876
Commercial Services - 0.67%				Universal Health Services Inc	164,135		17,023
Robert Half International Inc	152,299		8,343		$		31,899
TrueBlue Inc ^(a)	335,444		8,292	Housewares - 0.36%
	$		16,635	Tupperware Brands Corp	139,520		8,894
Computers - 5.32%
Apple Inc	767,513		82,891	Insurance - 2.58%
EMC Corp/MA	773,255		22,216	ACE Ltd	149,619		16,353
International Business Machines Corp	137,792		22,653	HCC Insurance Holdings Inc	398,334		20,789
Teradata Corp ^(a)	115,520		4,889	MetLife Inc	183,880		9,974
	$		132,649	StanCorp Financial Group Inc	55,059		3,830
				XL Group PLC	397,219		13,458
Consumer Products - 0.67%					$		64,404
Kimberly-Clark Corp	57,840		6,609
WD-40 Co	130,675		10,019	Internet - 2.77%
	$		16,628	Amazon.com Inc ^(a)	60,293		18,417
				eBay Inc ^(a)	254,892		13,382


Schedule of Investments
Principal Capital Appreciation Fund
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Internet (continued)				REITS (continued)
Google Inc - A Shares ^(a)	32,467	$	18,437	Annaly Capital Management Inc	146,819	$	1,675
Google Inc - C Shares ^(a)	30,117		16,838	Essex Property Trust Inc	52,489		10,590
LinkedIn Corp ^(a)	8,989		2,058	HCP Inc	296,954		13,057
	$		69,132	Plum Creek Timber Co Inc	227,294		9,321
				Sabra Health Care REIT Inc	179,411		5,126
Iron & Steel - 0.86%				Ventas Inc	165,543		11,342
Reliance Steel & Aluminum Co	201,345		13,587	Weyerhaeuser Co	475,784		16,110
Schnitzer Steel Industries Inc	333,893		7,863		$		81,490
	$		21,450
				Retail - 6.02%
Leisure Products & Services - 0.64%				Copart Inc ^(a)	398,681		13,332
Carnival Corp	161,511		6,485	Costco Wholesale Corp	311,483		41,542
Harley-Davidson Inc	142,778		9,380	CVS Health Corp	266,324		22,853
	$		15,865	Home Depot Inc/The	164,608		16,053
Lodging - 0.09%				Nordstrom Inc	385,555		27,995
Red Lion Hotels Corp ^(a)	399,920		2,268	Starbucks Corp	374,802		28,320
					$		150,095

Machinery - Construction & Mining - 0.35%				Savings & Loans - 0.58%
Caterpillar Inc	85,800		8,701	Washington Federal Inc	656,755		14,337

Machinery - Diversified - 0.82%				Semiconductors - 3.77%
AGCO Corp	68,157		3,020	Altera Corp	342,095		11,758
Deere & Co	203,756		17,429	Applied Materials Inc	564,671		12,474
	$		20,449	Avago Technologies Ltd	101,302		8,737
				Intel Corp	511,500		17,396
Media - 2.48%				Lam Research Corp	198,496		15,455
Discovery Communications Inc - A Shares ^(a)	112,501		3,977
Discovery Communications Inc - C Shares ^(a)	67,344		2,356	Microchip Technology Inc	337,534		14,551
				Qualcomm Inc	171,523		13,466
Viacom Inc	216,986		15,770		$		93,837
Walt Disney Co/The	433,274		39,593
	$		61,696	Software - 6.38%
				Actuate Corp ^(a)	35,960		154
Metal Fabrication & Hardware - 0.53%				Adobe Systems Inc ^(a)	478,768		33,571
Precision Castparts Corp	60,277		13,303	Autodesk Inc ^(a)	170,499		9,810
				Fair Isaac Corp	218,279		13,599
Mining - 0.37%				Informatica Corp ^(a)	217,560		7,758
Freeport-McMoRan Inc	319,875		9,116	Microsoft Corp	977,438		45,891
				Omnicell Inc ^(a)	206,649		6,677
				Oracle Corp	762,195		29,764
Miscellaneous Manufacturing - 1.88%				Tyler Technologies Inc ^(a)	105,851		11,847
AptarGroup Inc	197,324		12,281		$		159,071
Crane Co	151,012		9,416
General Electric Co	973,272		25,120	Telecommunications - 2.86%
	$		46,817	AT&T Inc	433,122		15,090
				China Mobile Ltd ADR	193,313		12,003
Oil & Gas - 7.05%				Cisco Systems Inc	484,618		11,858
Apache Corp	271,858		20,987	Corning Inc	537,187		10,975
Chevron Corp	356,220		42,728	Polycom Inc ^(a)	351,790		4,601
Devon Energy Corp	245,913		14,755	Verizon Communications Inc	335,896		16,879
Energen Corp	141,848		9,603		$		71,406
Exxon Mobil Corp	523,337		50,612
HollyFrontier Corp	139,039		6,310	Toys, Games & Hobbies - 0.67%
Occidental Petroleum Corp	292,103		25,977	Hasbro Inc	157,156		9,041
Total SA ADR	77,480		4,640	Mattel Inc	246,614		7,663
	$		175,612		$		16,704

Oil & Gas Services - 0.68%				Transportation - 1.69%
Natural Gas Services Group Inc ^(a)	258,057		6,640	Expeditors International of Washington Inc	419,984		17,916
Schlumberger Ltd	103,674		10,228	Union Pacific Corp	207,728		24,190
	$		16,868		$		42,106

Pharmaceuticals - 6.73%				Trucking & Leasing - 0.25%
Abbott Laboratories	298,248		13,001	Greenbrier Cos Inc/The	98,299		6,148
AbbVie Inc	316,069		20,058
Actavis PLC ^(a)	42,580		10,336
				Water - 0.20%
Allergan Inc/United States	143,629		27,298	California Water Service Group	190,343		4,955
Bristol-Myers Squibb Co	286,472		16,670
Johnson & Johnson	229,180		24,701	TOTAL COMMON STOCKS	$		2,436,744
McKesson Corp	189,706		38,588
Teva Pharmaceutical Industries Ltd ADR	137,452		7,762
VCA Inc ^(a)	202,007		9,205
	$		167,619

REITS - 3.27%
Alexandria Real Estate Equities Inc	171,911		14,269


		Schedule of Investments Real Estate Securities Fund October 31, 2014




COMMON STOCKS - 99.45%	Shares Held		Value(000			's)

Healthcare - Services - 0.73%
Brookdale Senior Living Inc ^(a)	438,078			$	14,768


Real Estate - 1.22%
Jones Lang LaSalle Inc	183,100				24,757


REITS - 97.50%
American Realty Capital Properties Inc	931,415				8,262
Apartment Investment & Management Co	1,569,763				56,182
AvalonBay Communities Inc	460,037				71,692
Aviv REIT Inc	444,663				14,998
Boston Properties Inc	640,644				81,202
Camden Property Trust	658,747				50,506
CBL & Associates Properties Inc	218,264				4,175
Corrections Corp of America	708,137				26,045
CubeSmart	1,624,322				34,192
DDR Corp	2,187,853				39,688
Duke Realty Corp	1,617,451				30,667
DuPont Fabros Technology Inc	422,743				13,092
Education Realty Trust Inc	1,619,430				18,235
EPR Properties	666,079				37,367
Equity One Inc	1,008,124				24,195
Equity Residential	846,955				58,914
Essex Property Trust Inc	479,153				96,674
Extra Space Storage Inc	776,306				45,150
Federal Realty Investment Trust	282,848				37,279
First Industrial Realty Trust Inc	2,297,961				44,879
General Growth Properties Inc	2,932,612				75,984
Geo Group Inc/The	150,138				5,997
HCP Inc	724,086				31,838
Health Care REIT Inc	1,103,083				78,440
Host Hotels & Resorts Inc	3,585,361				83,575
Kilroy Realty Corp	668,758				45,302
Pebblebrook Hotel Trust	1,241,984				52,909
Prologis Inc	2,029,302				84,520
Public Storage	418,993				77,237
Saul Centers Inc	376,533				20,691
Simon Property Group Inc	1,279,634				229,323
SL Green Realty Corp	740,729				85,702
Strategic Hotels & Resorts Inc ^(a)	2,332,321				29,970
Sun Communities Inc	434,778				25,204
Sunstone Hotel Investors Inc	2,200,438				33,689
Taubman Centers Inc	452,217				34,391
Ventas Inc	1,229,304				84,220
Vornado Realty Trust	684,677				74,958
Washington Prime Group Inc	645,067				11,373
Weingarten Realty Investors	695,834				25,224
			$		1,983,941
TOTAL COMMON STOCKS			$		2,023,466
INVESTMENT COMPANIES - 1.01%	Shares Held		Value(000			's)

Publicly Traded Investment Fund - 1.01%
BlackRock Liquidity Funds FedFund Portfolio	20,528,127				20,528

TOTAL INVESTMENT COMPANIES			$		20,528
Total Investments			$		2,043,994
Liabilities in Excess of Other Assets, Net - (0.46)%			$		(9,281	)
TOTAL NET ASSETS - 100.00%			$		2,034,713


(a) Non-Income Producing Security



Portfolio Summary (unaudited)
Sector					Percent
Financial					98.72	%
Exchange Traded Funds					1.01	%
Consumer, Non-cyclical					0.73	%
Liabilities in Excess of Other Assets, Net					(0.46	)%
TOTAL NET ASSETS					100.00	%


Schedule of Investments
Short-Term Income Fund
October 31, 2014



	INVESTMENT COMPANIES - 2.06%		Shares Held		Value (000's)					Principal
							BONDS (continued)		Amount (000's)		Value (000's)
	Publicly Traded Investment Fund - 2.06%
	Morgan Stanley Institutional Liquidity Funds -			52,241,064	$	52,241	Automobile Floor Plan Asset Backed Securities (continued)
	Government Portfolio						Ford Credit Floorplan Master Owner Trust A
							0.53%, 01/15/2018 ^(b)		$	18,000	$	18,019
	TOTAL INVESTMENT COMPANIES			$		52,241	0.55%, 02/15/2019 ^(b)			6,000		6,008
				Principal			Nissan Master Owner Trust Receivables
	BONDS- 95.84	%	Amount (000's)		Value (000's)		0.45%, 02/15/2018 ^(b)			17,000		17,000
							Volkswagen Credit Auto Master Trust
	Agriculture - 1.05%						0.51%, 07/22/2019 ^(a),(b)			12,000		12,006
	Cargill Inc						World Omni Master Owner Trust
	6.00%, 11/27/2017 ^(a)		$	23,500	$	26,612	0.50%, 02/15/2018 ^(a),(b)			15,250		15,264
										$		110,167

	Automobile Asset Backed Securities - 6.48%						Automobile Manufacturers - 1.60%
	American Credit Acceptance Receivables						Daimler Finance North America LLC
	Trust						1.38%, 08/01/2017 ^(a)			6,500		6,486
	1.64%, 11/15/2016 ^(a),(b)			1,877		1,879
							PACCAR Financial Corp
	AmeriCredit Automobile Receivables 2014-3						0.83%, 12/06/2018 ^(b)			6,250		6,288
	0.64%, 04/09/2018			13,500		13,499	2.20%, 09/15/2019			9,000		9,059
	AmeriCredit Automobile Receivables Trust						Toyota Motor Credit Corp
	2013-3						2.10%, 01/17/2019			18,750		18,871
	0.68%, 10/11/2016 ^(b)			2,503		2,504
										$		40,704
	AmeriCredit Automobile Receivables Trust
	2013-5						Banks- 15.78	%
	0.53%, 03/08/2017 ^(b)			3,251		3,253	Australia & New Zealand Banking Group
	AmeriCredit Automobile Receivables Trust						Ltd/New York NY
	2014-1						0.79%, 05/15/2018 ^(b)			7,250		7,280
	0.57%, 07/10/2017 ^(b)			9,026		9,030	Bank of America Corp
	AmeriCredit Automobile Receivables Trust						2.60%, 01/15/2019			5,000		5,048
	2014-2						Bank of America NA
	0.54%, 10/10/2017 ^(b)			18,000		18,005	0.51%, 06/15/2016 ^(b)			13,000		12,948
	Capital Auto Receivables Asset Trust / Ally						1.25%, 02/14/2017			5,500		5,507
	0.97%, 01/22/2018			14,000		14,020	5.30%, 03/15/2017			24,900		27,000
	Capital Auto Receivables Asset Trust 2014-1						Bank of New York Mellon Corp/The
	0.68%, 05/20/2016 ^(b)			4,500		4,504	2.20%, 05/15/2019			11,000		11,038
	Capital Auto Receivables Asset Trust 2014-3						BB&T Corp
	0.48%, 02/21/2017 ^(b)			12,500		12,501	0.90%, 02/01/2019 ^(b)			5,500		5,546
	CPS Auto Receivables Trust 2013-A						Branch Banking & Trust Co
	1.31%, 06/15/2020 ^(a),(b)			14,713		14,707	0.53%, 05/23/2017 ^(b)			13,250		13,161
	CPS Auto Receivables Trust 2013-B						0.55%, 09/13/2016 ^(b)			13,500		13,471
	1.82%, 09/15/2020 ^(a),(b)			7,335		7,359	Citigroup Inc
	CPS Auto Receivables Trust 2013-C						0.72%, 08/14/2017 ^(b)			10,000		10,008
	1.64%, 04/16/2018 ^(a)			7,094		7,121	1.00%, 04/08/2019 ^(b)			4,500		4,517
	CPS Auto Receivables Trust 2013-D						4.75%, 05/19/2015			8,750		8,945
	1.54%, 07/16/2018 ^(a),(b)			4,831		4,851	6.13%, 05/15/2018			16,500		18,742
	CPS Auto Receivables Trust 2014-C						Commonwealth Bank of Australia/New York
	1.31%, 02/15/2019 ^(a),(b)			9,762		9,771	NY
	CPS Auto Trust						2.25%, 03/13/2019			4,500		4,521
	1.48%, 03/16/2020 ^(a)			3,001		3,011	Goldman Sachs Group Inc/The
	Santander Drive Auto Receivables Trust 2013-						1.25%, 10/23/2019 ^(b)			9,500		9,532
	5						1.33%, 11/15/2018 ^(b)			18,750		18,942
	0.53%, 04/17/2017 ^(b)			3,172		3,173	JP Morgan Chase Bank NA
	Santander Drive Auto Receivables Trust 2014-						0.56%, 06/13/2016 ^(b)			6,000		5,983
	1						5.88%, 06/13/2016			8,750		9,425
	0.74%, 06/15/2017			6,722		6,721	6.00%, 10/01/2017			28,500		31,918
	Santander Drive Auto Receivables Trust 2014-						KeyBank NA/Cleveland OH
	2						5.45%, 03/03/2016			5,750		6,096
	0.54%, 07/17/2017 ^(b)			14,000		14,003	7.41%, 10/15/2027			24,500		25,273
	Santander Drive Auto Receivables Trust 2014-						Morgan Stanley
	3						1.08%, 01/24/2019 ^(b)			29,750		29,960
	0.54%, 08/15/2017 ^(b)			7,000		7,001	1.51%, 04/25/2018 ^(b)			16,000		16,357
	Westlake Automobile Receivables Trust 2014-						National City Bank/Cleveland OH
	2						0.60%, 06/07/2017 ^(b)			4,500		4,465
	0.97%, 10/16/2017 ^(a),(b)			7,500		7,503	PNC Bank NA
				$		164,416	4.88%, 09/21/2017			14,800		16,165
							PNC Financial Services Group Inc/The
	Automobile Floor Plan Asset Backed Securities - 4.34%						6.75%, 07/29/2049 ^(b)			7,300		7,968
	Ally Master Owner Trust						SunTrust Bank/Atlanta GA
	0.60%, 04/15/2018 ^(b)			16,500		16,524	0.52%, 08/24/2015 ^(b)			12,000		11,996
	0.62%, 01/15/2019 ^(b)			5,500		5,517
							7.25%, 03/15/2018			9,000		10,408
	CNH Wholesale Master Note Trust						US Bank NA/Cincinnati OH
	0.75%, 08/15/2019 ^(a),(b)			8,750		8,771	0.46%, 01/30/2017 ^(b)			9,500		9,506
	Ford Credit Auto Owner Trust/Ford Credit						0.71%, 10/28/2019 ^(b)			9,000		9,018
	2014-RE	V1					Wells Fargo & Co
	2.26%, 11/15/2025 ^(a),(b)			11,000		11,058	7.98%, 12/31/2049 ^(b)			18,250		20,115


Schedule of Investments
Short-Term Income Fund
October 31, 2014



		Principal						Principal
BONDS (continued)		Amount (000's)	Value (000's)		BONDS (continued)		Amount (000's)		Value (000's)

Banks (continued)					Electric (continued)
Wells Fargo Bank NA					PPL Energy Supply LLC
6.00%, 11/15/2017	$	8,500	$	9,614	5.70%, 10/15/2035		$	10,000	$	10,262
		$		400,473	6.50%, 05/01/2018			4,750		5,157
					Public Service Co of New Mexico
Beverages - 1.39%					7.95%, 05/15/2018			19,000		22,647
Anheuser-Busch InBev Finance Inc					Southern Co/The
2.15%, 02/01/2019		9,500		9,504	2.45%, 09/01/2018			11,000		11,254
SABMiller Holdings Inc					TransAlta Corp
0.93%, 08/01/2018 ^(a),(b)		4,500		4,533
1.85%, 01/15/2015 ^(a)		5,500		5,514	6.65%, 05/15/2018			18,250		20,500
SABMiller PLC								$		123,651
6.50%, 07/01/2016 ^(a)		14,500		15,817	Finance - Mortgage Loan/Banker - 9.27%
		$		35,368	Fannie Mae
					0.88%, 02/08/2018			17,000		16,808
Biotechnology - 0.87%					1.00%, 09/27/2017			19,000		18,987
Amgen Inc					1.13%, 04/27/2017			31,000		31,255
1.25%, 05/22/2017		9,000		8,939	1.75%, 06/20/2019			57,500		57,595
2.20%, 05/22/2019		9,000		8,931	1.75%, 09/12/2019			71,250		71,213
Gilead Sciences Inc					1.88%, 02/19/2019			39,000		39,507
2.40%, 12/01/2014		4,250		4,256				$		235,365
		$		22,126
					Food- 0.45	%
Chemicals - 0.60%					Ingredion Inc
Airgas Inc					3.20%, 11/01/2015			6,750		6,898
1.65%, 02/15/2018		3,000		2,983	Tesco PLC
3.25%, 10/01/2015		12,000		12,273	2.00%, 12/05/2014 ^(a)			4,500		4,504
		$		15,256				$		11,402

Commercial Services - 0.15%					Gas- 0.23	%
ERAC USA Finance LLC					Laclede Group Inc/The
5.60%, 05/01/2015 ^(a)		3,750		3,836
					0.98%, 08/15/2017 ^(b)			5,750		5,744


Computers - 0.81%					Healthcare - Services - 1.03%
Apple Inc					Roche Holdings Inc
1.00%, 05/03/2018		4,500		4,413	0.57%, 09/30/2019 ^(a),(b)			14,000		13,993
International Business Machines Corp					WellPoint Inc
1.95%, 02/12/2019		16,250		16,244	5.88%, 06/15/2017			11,000		12,234
		$		20,657				$		26,227

Credit Card Asset Backed Securities - 1.20%					Home Equity Asset Backed Securities - 2.68%
Cabela's Credit Card Master Note Trust					ABFC 2005-OPT1 Trust
0.50%, 03/16/2020 ^(b)		5,750		5,747
					0.51%, 07/25/2035 ^(b)			488		480
0.60%, 07/15/2022 ^(b)		9,250		9,228
0.63%, 06/15/2020 ^(a),(b)		5,400		5,437	ABFC 2005-WMC1 Trust
					0.81%, 06/25/2035 ^(b)			2,652		2,613
0.85%, 09/17/2018 ^(a),(b)		10,000		10,038
					ACE Securities Corp Home Equity Loan Trust
		$		30,450	Series 2005-AG1
Diversified Financial Services - 4.91%					0.51%, 08/25/2035 ^(b)			214		207
Ford Motor Credit Co LLC					ACE Securities Corp Home Equity Loan Trust
3.98%, 06/15/2016		15,550		16,242	Series 2005-HE2
General Electric Capital Corp					0.87%, 04/25/2035 ^(b)			1,484		1,488
0.74%, 01/14/2019 ^(b)		17,250		17,300	ACE Securities Corp Home Equity Loan Trust
0.88%, 07/12/2016 ^(b)		24,250		24,447	Series 2005-WF1
5.63%, 09/15/2017		4,750		5,310	0.49%, 05/25/2035 ^(b)			2,405		2,372
6.38%, 11/15/2067 ^(b)		9,000		9,608	Asset Backed Securities Corp Home Equity
Jefferies Group LLC					Loan Trust Series OOMC 2005-HE6
3.88%, 11/09/2015		8,750		9,010	0.66%, 07/25/2035 ^(b)			3,463		3,430
5.50%, 03/15/2016		3,500		3,704	Bayview Financial Acquisition Trust
MassMutual Global Funding II					0.78%, 05/28/2044 ^(b)			1,000		998
2.10%, 08/02/2018 ^(a)		9,500		9,582	5.66%, 12/28/2036 ^(b)			337		337
Murray Street Investment Trust I					Bear Stearns Asset Backed Securities I Trust
4.65%, 03/09/2017 ^(b)		27,500		29,360	2006-PC1
					0.48%, 12/25/2035 ^(b)			6,659		6,620
		$		124,563
					Credit Suisse First Boston Mortgage Securities
Electric - 4.87%					Corp
Dominion Resources Inc/VA					4.80%, 05/25/2035			4,425		4,556
1.40%, 09/15/2017		9,000		8,969	Home Equity Asset Trust 2005-4
Indiantown Cogeneration LP					0.86%, 10/25/2035 ^(b)			4,725		4,416
9.77%, 12/15/2020		11,385		12,922	JP Morgan Mortgage Acquisition Corp 2005-
LG&E and KU Energy LLC					FLD1
2.13%, 11/15/2015		10,000		10,123	0.89%, 07/25/2035 ^(b)			1,739		1,729
NextEra Energy Capital Holdings Inc					JP Morgan Mortgage Acquisition Corp 2005-
7.30%, 09/01/2067 ^(b)		11,500		12,441	OPT1
NiSource Finance Corp					0.60%, 06/25/2035 ^(b)			1,301		1,291
5.25%, 09/15/2017		8,500		9,376


Schedule of Investments
Short-Term Income Fund
October 31, 2014



				Principal					Principal
	BONDS (continued)		Amount (000's)		Value (000's)		BONDS (continued)		Amount (000's)	Value (000's)

	Home Equity Asset Backed Securities (continued)						Mining (continued)
	Mastr Asset Backed Securities Trust 2005-						Teck Resources Ltd
	FRE1						5.38%, 10/01/2015	$	3,750	$	3,898
	0.40%, 10/25/2035 ^(b)		$	383	$	383			$		16,881
	New Century Home Equity Loan Trust 2005-
	3						Mortgage Backed Securities - 8.98%
	0.63%, 07/25/2035 ^(b)			15,714		15,626	Alternative Loan Trust 2004-J8
	RAMP Series 2005-EFC2 Trust						6.00%, 02/25/2017		391		394
	0.62%, 07/25/2035 ^(b)			453		453	Banc of America Alternative Loan Trust 2003-
	RASC Series 2003-KS10 Trust						10
	4.47%, 03/25/2032			610		619	5.00%, 12/25/2018		689		704
	Soundview Home Loan Trust 2005-CTX1						Banc of America Funding 2004-1 Trust
	0.57%, 11/25/2035 ^(b)			3,399		3,356	5.25%, 02/25/2019		1,081		1,120
	Structured Asset Securities Corp Mortgage						Banc of America Funding 2004-3 Trust
	Loan Trust Series 2005-GEL4						4.75%, 09/25/2019		778		795
	0.77%, 08/25/2035 ^(b)			1,200		1,138	Banc of America Funding 2006-G Trust
							0.33%, 07/20/2036 ^(b)		851		849
	Terwin Mortgage Trust 2005-2HE
	0.91%, 01/25/2035 ^(a),(b)			366		364	Banc of America Mortgage Trust 2004-8
	Terwin Mortgage Trust Series TMTS 2005-						5.25%, 10/25/2019		393		403
	14	HE					Banc of America Mortgage Trust 2005-7
	4.85%, 08/25/2036 ^(b)			1,946		2,006	5.00%, 08/25/2020		228		232
	Wells Fargo Home Equity Asset-Backed						BCAP LLC 2011-RR11 Trust
							2.53%, 03/26/2035 ^(a),(b)		4,020		4,042
	Securities 2004-2 Trust
	0.57%, 10/25/2034 ^(b)			267		259	CHL Mortgage Pass-Through Trust 2003-46
							2.46%, 01/19/2034 ^(b)		1,499		1,497
	5.00%, 10/25/2034			11,500		11,480
	5.00%, 10/25/2034			26		26	CHL Mortgage Pass-Through Trust 2004-19
	Wells Fargo Home Equity Asset-Backed						5.25%, 10/25/2034		81		81
	Securities 2005-2 Trust						CHL Mortgage Pass-Through Trust 2004-J1
							4.50%, 01/25/2019 ^(b)		281		286
	0.56%, 11/25/2035 ^(b)			1,773		1,769
				$		68,016	CHL Mortgage Pass-Through Trust 2004-J7
							5.00%, 09/25/2019		771		798
	Insurance - 4.59%						Citigroup Mortgage Loan Trust 2009-6
	Berkshire Hathaway Finance Corp						2.61%, 07/25/2036 ^(a),(b)		1,776		1,787
	1.60%, 05/15/2017			11,000		11,134	Credit Suisse First Boston Mortgage Securities
	2.00%, 08/15/2018			11,500		11,587	Corp
	Chubb Corp/The						1.11%, 05/25/2034 ^(b)		522		508
	6.38%, 03/29/2067 ^(b)			2,750		2,997	5.00%, 09/25/2019		137		134
	Lincoln National Corp						5.00%, 10/25/2019		820		824
	7.00%, 05/17/2066 ^(b)			4,500		4,612	Credit Suisse Mortgage Capital Certificates
	MetLife Inc						2.36%, 07/27/2037 ^(a),(b)		2,256		2,270
	6.82%, 08/15/2018			10,000		11,725	Deutsche Mortgage Securities Inc REMIC
	Metropolitan Life Global Funding I						Trust Series 2010-RS2
	1.30%, 04/10/2017 ^(a)			6,750		6,764	3.81%, 06/28/2047 ^(a),(b)		2,975		2,973
	2.30%, 04/10/2019 ^(a)			6,750		6,767	Fannie Mae REMICS
	New York Life Global Funding						3.50%, 03/25/2042		1,590		1,660
	2.45%, 07/14/2016 ^(a)			9,000		9,270	Freddie Mac REMICS
	Prudential Covered Trust 2012-1						0.60%, 06/15/2023 ^(b)		13		13
	3.00%, 09/30/2015 ^(a)			3,844		3,916	Ginnie Mae
	Prudential Holdings LLC						0.62%, 07/16/2054 ^(b)		87,638		4,849
	1.11%, 12/18/2017 ^(a),(b)			18,326		18,453	0.70%, 08/16/2051 ^(b)		85,128		5,173
	8.70%, 12/18/2023 ^(a)			22,855		29,271	0.87%, 02/16/2053 ^(b)		125,607		8,823
				$		116,496	0.91%, 03/16/2049 ^(b)		115,224		6,502
							0.91%, 09/16/2055 ^(b)		49,703		3,363
	Iron & Steel - 0.26%						0.92%, 03/16/2052 ^(b)		86,504		6,930
	ArcelorMittal						0.93%, 10/16/2054 ^(b)		74,064		4,920
	4.25%, 03/01/2016			6,500		6,646	0.94%, 10/16/2054 ^(b)		57,564		3,342
							0.94%, 06/16/2055 ^(b)		50,314		3,158
	Manufactured Housing Asset Backed Securities - 0.00%						0.99%, 02/16/2055 ^(b)		77,294		3,994
	Green Tree Financial Corp						1.00%, 01/16/2055 ^(b)		112,261		6,861
	7.70%, 09/15/2026			120		128	1.01%, 10/16/2054 ^(b)		85,207		5,507
							1.04%, 09/16/2055 ^(b)		19,823		1,353
							1.11%, 01/16/2054 ^(b)		64,107		4,535
	Media- 0.98	%					1.14%, 08/16/2042 ^(b)		96,283		7,109
	CBS Corp						1.15%, 06/16/2045 ^(b)		87,305		6,657
	2.30%, 08/15/2019			9,000		8,882	1.22%, 02/16/2046 ^(b)		87,845		7,007
	NBCUniversal Enterprise Inc						1.27%, 10/16/2051 ^(b)		4,614		388
	0.77%, 04/15/2016 ^(a),(b)			4,500		4,519
							1.41%, 12/16/2036 ^(b)		76,961		6,132
	Time Warner Cable Inc						1.61%, 01/16/2040 ^(b)		34,343		2,168
	8.25%, 04/01/2019			9,250		11,486	4.50%, 08/20/2032		164		170
				$		24,887	JP Morgan Mortgage Trust 2004-A3
	Mining - 0.67%						2.34%, 07/25/2034 ^(b)		1,991		1,999
	Glencore Finance Canada Ltd						JP Morgan Mortgage Trust 2004-S1
	2.70%, 10/25/2017 ^(a),(b)			12,750		12,983	5.00%, 09/25/2034		2,383		2,479


Schedule of Investments
Short-Term Income Fund
October 31, 2014



		Principal					Principal
BONDS (continued)		Amount (000's)	Value (000's)		BONDS (continued)		Amount (000's)	Value (000's)

Mortgage Backed Securities (continued)					Other Asset Backed Securities (continued)
JP Morgan Resecuritization Trust Series 2010-					Carrington Mortgage Loan Trust Series 2005-
4					NC4
2.36%, 10/26/2036 ^(a),(b)	$	1,697	$	1,699	0.55%, 09/25/2035 ^(b)	$	1,354	$	1,340
MASTR Alternative Loan Trust 2003-9					Citigroup Mortgage Loan Trust Inc
6.50%, 01/25/2019		665		680	0.58%, 07/25/2035 ^(b)		665		658
MASTR Asset Securitization Trust 2004-11					Countrywide Asset-Backed Certificates
5.00%, 12/25/2019		160		164	0.64%, 12/25/2035 ^(b)		716		714
MASTR Asset Securitization Trust 2004-9					Credit-Based Asset Servicing and
5.00%, 09/25/2019		800		814	Securitization LLC
PHH Mortgage Trust Series 2008-CIM1					4.28%, 08/25/2035 ^(b)		837		844
5.22%, 06/25/2038		6,886		6,984	4.81%, 07/25/2035 ^(b)		5,720		5,832
Prime Mortgage Trust 2005-2					CWABS Asset-Backed Certificates Trust
5.25%, 07/25/2020 ^(b)		1,190		1,212	2005-3
Provident Funding Mortgage Loan Trust 2005-					0.60%, 08/25/2035 ^(b)		2,664		2,650
1					CWABS Asset-Backed Certificates Trust
0.44%, 05/25/2035 ^(b)		6,103		5,858	2005-7
RALI Series 2003-QS23 Trust					0.66%, 11/25/2035 ^(b)		2,260		2,251
5.00%, 12/26/2018		2,118		2,150	Drug Royalty II LP 2
RALI Series 2004-QS3 Trust					3.48%, 07/15/2023 ^(a),(b)		12,834		12,912
5.00%, 03/25/2019		1,130		1,166	FFMLT Trust 2005-FF2
RBSSP Resecuritization Trust 2009-7					0.81%, 03/25/2035 ^(b)		648		648
0.55%, 06/26/2037 ^(a),(b)		1,222		1,169	Fieldstone Mortgage Investment Trust Series
Sequoia Mortgage Trust 2013-4					2005-1
1.55%, 04/25/2043 ^(b)		15,638		14,581	1.23%, 03/25/2035 ^(b)		4,033		4,029
Sequoia Mortgage Trust 2013-8					First Franklin Mortgage Loan Trust 2005-
2.25%, 06/25/2043 ^(b)		11,840		11,222	FF4
Springleaf Mortgage Loan Trust					0.58%, 05/25/2035 ^(b)		921		915
1.27%, 06/25/2058 ^(a),(b)		13,923		13,874	JP Morgan Mortgage Acquisition Corp 2005-
Springleaf Mortgage Loan Trust 2012-2					OPT2
2.22%, 10/25/2057 ^(a)		12,165		12,336	0.44%, 12/25/2035 ^(b)		2,972		2,904
Springleaf Mortgage Loan Trust 2012-3					Mastr Specialized Loan Trust
1.57%, 12/25/2059 ^(a),(b)		10,659		10,652	1.40%, 11/25/2034 ^(a),(b)		1,522		1,525
2.66%, 12/25/2059 ^(a),(b)		4,623		4,623	Merrill Lynch Mortgage Investors Trust Series
3.56%, 12/25/2059 ^(a)		2,500		2,538	2005-FM1
Springleaf Mortgage Loan Trust 2013-2					0.53%, 05/25/2036 ^(b)		1,112		1,106
1.78%, 12/25/2065 ^(a)		7,539		7,525	NYCTL 2014-A Trust
3.52%, 12/25/2065 ^(a),(b)		3,500		3,571	1.03%, 11/10/2027 ^(a),(c)		8,500		8,495
WaMu Mortgage Pass-Through Certificates					OneMain Financial Issuance Trust 2014-1
Series 2003-S8 Trust					2.43%, 06/18/2024 ^(a),(b),(c)		14,000		14,076
5.00%, 09/25/2018		221		226	OneMain Financial Issuance Trust 2014-2
		$		227,833	2.47%, 09/18/2024 ^(a),(c)		11,000		11,003
					PFS Financing Corp
Oil & Gas - 3.21%					0.65%, 04/17/2017 ^(a),(b)		8,750		8,753
BP Capital Markets PLC					0.70%, 02/15/2018 ^(a),(b)		18,000		17,993
4.75%, 03/10/2019		19,000		20,949	0.75%, 02/15/2019 ^(a),(b)		11,250		11,272
Chevron Corp					0.83%, 10/15/2019 ^(a),(b)		9,000		8,995
1.72%, 06/24/2018		11,700		11,809	PFS Tax Lien Trust 2014-1
Ensco PLC					1.44%, 05/15/2029 ^(a),(b)		6,947		6,965
3.25%, 03/15/2016		12,000		12,338	Saxon Asset Securities Trust 2005-3
Phillips 66					0.52%, 11/25/2035 ^(b)		364		363
2.95%, 05/01/2017		11,000		11,423	Securitized Asset Backed Receivables LLC
Sinopec Group Overseas Development 2014					Trust 2005-OP2
Ltd					0.47%, 10/25/2035 ^(b)		5,765		5,584
1.75%, 04/10/2017 ^(a)		9,500		9,488
					Securitized Asset Backed Receivables LLC
Total Capital International SA					Trust 2006-OP1
0.80%, 08/10/2018 ^(b)		5,250		5,301
					0.45%, 10/25/2035 ^(b)		303		298
1.55%, 06/28/2017		10,000		10,066	Springleaf Funding Trust 2013-A
		$		81,374	2.58%, 09/15/2021 ^(a),(b)		4,000		4,028
Oil & Gas Services - 0.40%					Trafigura Securitisation Finance PLC
Weatherford International Ltd/Bermuda					1.10%, 10/15/2021 ^(a),(b),(c)		7,500		7,500
5.50%, 02/15/2016		9,500		10,031	Wachovia Mortgage Loan Trust Series 2005-
					WMC1
					0.89%, 10/25/2035 ^(b)		1,593		1,577
Other Asset Backed Securities - 5.89%							$		149,568
Ameriquest Mortgage Securities Inc Asset-
Backed Pass-Through Ctfs Ser 2004-R11					Pharmaceuticals - 1.22%
0.76%, 11/25/2034 ^(b)		624		622	AbbVie Inc
Ameriquest Mortgage Securities Inc Asset-					1.20%, 11/06/2015		22,500		22,627
Backed Pass-Through Ctfs Ser 2005-R1					Merck & Co Inc
0.60%, 03/25/2035 ^(b)		3,555		3,546	1.10%, 01/31/2018		8,500		8,427
Ameriquest Mortgage Securities Inc Asset-							$		31,054
Backed Pass-Through Ctfs Ser 2005-R6
0.35%, 08/25/2035 ^(b)		171		170


Schedule of Investments
Short-Term Income Fund
October 31, 2014



				Principal						Principal
	BONDS (continued)		Amount (000's)		Value (000's)		BONDS (continued)		Amount (000's)		Value (000's)

	Pipelines - 1.72%						Student Loan Asset Backed Securities (continued)
	Buckeye Partners LP						SLM Private Education Loan Trust 2014-A
	2.65%, 11/15/2018		$	11,000	$	10,988	0.75%, 07/15/2022 ^(a),(b)		$	3,688	$	3,685
	DCP Midstream LLC									$		84,772
	5.38%, 10/15/2015 ^(a)			4,585		4,777
	Florida Gas Transmission Co LLC						Telecommunications - 2.38%
	4.00%, 07/15/2015 ^(a)			6,000		6,135	AT&T Inc
							0.62%, 02/12/2016 ^(b)			9,000		9,019
	7.90%, 05/15/2019 ^(a)			10,000		12,158
	TransCanada PipeLines Ltd						Cisco Systems Inc
	6.35%, 05/15/2067 ^(b)			9,500		9,595	1.10%, 03/03/2017			13,500		13,524
				$		43,653	Verizon Communications Inc
							1.98%, 09/14/2018 ^(b)			4,500		4,709
	Real Estate - 0.45%						3.65%, 09/14/2018			12,500		13,220
	WEA Finance LLC / Westfield UK & Europe						5.50%, 02/15/2018			4,250		4,764
	Finance PLC						Vodafone Group PLC
	1.75%, 09/15/2017 ^(a)			4,750		4,760	0.62%, 02/19/2016 ^(b)			9,000		9,018
	2.70%, 09/17/2019 ^(a)			6,500		6,543	1.63%, 03/20/2017			6,000		6,029
				$		11,303				$		60,283

	REITS- 1.97	%					Transportation - 0.35%
	BioMed Realty LP						Ryder System Inc
	2.63%, 05/01/2019			7,500		7,493	2.45%, 11/15/2018			8,750		8,806
	3.85%, 04/15/2016			7,000		7,278
	Health Care REIT Inc
	3.63%, 03/15/2016			5,500		5,696	Trucking & Leasing - 0.79%
	5.88%, 05/15/2015			6,000		6,164	Penske Truck Leasing Co Lp / PTL Finance
							Corp
	Healthcare Realty Trust Inc						2.50%, 03/15/2016 ^(a)			6,000		6,116
	5.75%, 01/15/2021			6,830		7,638	3.13%, 05/11/2015 ^(a)			13,750		13,908
	6.50%, 01/17/2017			4,500		4,977
	Nationwide Health Properties Inc									$		20,024
	6.00%, 05/20/2015			4,500		4,628	TOTAL BONDS			$		2,432,556
	Ventas Realty LP / Ventas Capital Corp						U.S. GOVERNMENT & GOVERNMENT			Principal
	2.70%, 04/01/2020			6,250		6,201	AGENCY OBLIGATIONS - 1.69%		Amount (000's)		Value (000's)
				$		50,075	Federal Home Loan Mortgage Corporation (FHLMC) -
							0.01	%
	Savings & Loans - 0.00%						2.24%, 11/01/2021 ^(b)		$	8	$	8
	Washington Mutual Bank / Henderson NV						2.38%, 09/01/2035 ^(b)			132		141
	0.00%, 01/15/2013 ^(d)			1,200		—	6.00%, 04/01/2017			23		24
							6.00%, 05/01/2017			40		42
	Semiconductors - 0.53%						6.50%, 12/01/2015			2		2
	Samsung Electronics America Inc						7.00%, 12/01/2022			110		117
	1.75%, 04/10/2017 ^(a)			13,500		13,579	7.50%, 12/01/2029			1		1
							9.50%, 08/01/2016			2		2
										$		337
	Software - 0.40%
	Oracle Corp						Federal National Mortgage Association (FNMA) - 0.05%
	0.74%, 10/08/2019 ^(b)			5,000		5,022	2.03%, 10/01/2035 ^(b)			309		328
							2.13%, 07/01/2034 ^(b)			170		182
	5.75%, 04/15/2018			4,500		5,108	2.13%, 08/01/2034 ^(b)			71		76
				$		10,130	2.14%, 01/01/2019 ^(b)			1		2
	Student Loan Asset Backed Securities - 3.34%						2.18%, 11/01/2022 ^(b)			2		2
	KeyCorp Student Loan Trust 2006-A						2.18%, 07/01/2034 ^(b)			56		59
	0.54%, 09/27/2035 ^(b)			19,000		18,275	2.21%, 12/01/2032 ^(b)			51		53
	SLC Private Student Loan Trust 2006-A						2.27%, 02/01/2037 ^(b)			154		162
	0.40%, 07/15/2036 ^(b)			5,524		5,477	2.36%, 01/01/2035 ^(b)			29		29
	SLC Private Student Loan Trust 2010-B						2.37%, 01/01/2035 ^(b)			137		147
	3.65%, 07/15/2042 ^(a),(b)			4,397		4,613	2.41%, 11/01/2032 ^(b)			51		52
	SLM Private Credit Student Loan Trust 2002-						2.43%, 02/01/2035 ^(b)			25		26
	A						4.16%, 11/01/2035 ^(b)			10		10
	0.78%, 12/16/2030 ^(b)			8,451		8,328	5.60%, 04/01/2019 ^(b)			3		3
	SLM Private Credit Student Loan Trust 2004-						6.00%, 07/01/2028			3		3
	B						7.50%, 10/01/2029			9		10
	0.43%, 06/15/2021 ^(b)			5,353		5,326	8.00%, 05/01/2027			2		3
	SLM Private Credit Student Loan Trust 2005-						8.50%, 11/01/2017			3		3
	B						10.00%, 05/01/2022			3		3
	0.41%, 03/15/2023 ^(b)			1,728		1,713				$		1,153
	0.50%, 12/15/2023 ^(b)			6,650		6,472	Government National Mortgage Association (GNMA) -
	SLM Private Credit Student Loan Trust 2006-						0.00	%
	A						9.00%, 04/20/2025			2		2
	0.42%, 12/15/2023 ^(b)			2,050		2,029	10.00%, 01/15/2019			30		30
	SLM Private Education Loan Trust 2013-A									$		32
	0.75%, 08/15/2022 ^(a),(b)			13,499		13,514
	SLM Private Education Loan Trust 2013-B						U.S. Treasury - 1.63%
	0.80%, 07/15/2022 ^(a),(b)			6,016		6,016	0.38%, 01/31/2016			26,000		26,051
	1.85%, 06/17/2030 ^(a),(b)			9,500		9,324


Schedule of Investments
SmallCap Blend Fund
October 31, 2014



COMMON STOCKS - 96.08%	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Aerospace & Defense - 0.20%				Computers (continued)
Moog Inc ^(a)	13,328	$	1,020	Barracuda Networks Inc ^(a)	92,150	$	2,963
				Manhattan Associates Inc ^(a)	225,440		9,043
				NetScout Systems Inc ^(a)	187,690		6,918
Apparel - 1.62%				Nimble Storage Inc ^(a)	43,030		1,177
G-III Apparel Group Ltd ^(a)	57,970		4,600
Iconix Brand Group Inc ^(a)	91,400		3,657		$		20,398
	$		8,257	Distribution & Wholesale - 0.30%
				Rentrak Corp ^(a)	19,657		1,511
Automobile Parts & Equipment - 1.39%
Meritor Inc ^(a)	209,615		2,408
Tower International Inc ^(a)	192,550		4,679	Diversified Financial Services - 2.07%
	$		7,087	Cowen Group Inc ^(a)	498,990		2,016
				Evercore Partners Inc - Class A	12,340		639
Banks - 7.36%				Investment Technology Group Inc ^(a)	97,090		1,741
BBCN Bancorp Inc	252,550		3,571	OM Asset Management Plc ^(a)	213,820		3,201
Boston Private Financial Holdings Inc	102,070		1,342	Waddell & Reed Financial Inc	61,867		2,953
First Merchants Corp	27,428		621		$		10,550
First of Long Island Corp/The	30,000		790
Glacier Bancorp Inc	33,503		961	Electric - 1.97%
Green Bancorp Inc ^(a)	24,526		419	Avista Corp	127,324		4,514
PrivateBancorp Inc	218,940		7,076	NRG Yield Inc	110,430		5,518
Susquehanna Bancshares Inc	383,380		3,761		$		10,032
Webster Financial Corp	200,126		6,272	Electrical Components & Equipment - 1.37%
WesBanco Inc	57,600		1,985
Western Alliance Bancorp ^(a)	196,580		5,233	EnerSys	110,910		6,965
Wintrust Financial Corp	117,840		5,459
	$		37,490	Electronics - 0.13%
				Fluidigm Corp ^(a)	22,657		657
Biotechnology - 2.98%
Acceleron Pharma Inc ^(a)	12,880		476
Ardelyx Inc ^(a)	38,990		855	Energy - Alternate Sources - 1.19%
Avalanche Biotechnologies Inc ^(a)	11,025		396	Pattern Energy Group Inc	180,737		5,202
BIND Therapeutics Inc ^(a)	94,546		761	TerraForm Power Inc	30,741		875
Bluebird Bio Inc ^(a)	17,215		723		$		6,077
Cambrex Corp ^(a)	46,720		985
Cubist Pharmaceuticals Inc ^(a)	14,430		1,043	Engineering & Construction - 2.84%
				AECOM Technology Corp ^(a)	120,260		3,915
Cytokinetics Inc - Warrants ^(a),(b),(c)	110,568		—
Eleven Biotherapeutics Inc ^(a)	31,004		327	EMCOR Group Inc	143,834		6,347
				Tutor Perini Corp ^(a)	150,020		4,202
Epizyme Inc ^(a)	23,200		616
Exact Sciences Corp ^(a)	70,512		1,697		$		14,464
Fate Therapeutics Inc ^(a)	66,350		310	Entertainment - 1.40%
Genocea Biosciences Inc ^(a)	49,193		432	Marriott Vacations Worldwide Corp	103,000		7,152
Insmed Inc ^(a)	55,740		791
Intercept Pharmaceuticals Inc ^(a)	3,300		853
MacroGenics Inc ^(a)	36,550		778	Gas - 0.61%
Medivation Inc ^(a)	9,890		1,045	Southwest Gas Corp	53,440		3,104
NewLink Genetics Corp ^(a)	20,270		662
Puma Biotechnology Inc ^(a)	5,420		1,358	Healthcare - Products - 2.07%
Seattle Genetics Inc ^(a)	16,200		594	Amedica Corp ^(a)	70,050		156
Sunesis Pharmaceuticals Inc ^(a)	106,771		182	DexCom Inc ^(a)	52,460		2,358
Versartis Inc ^(a)	13,481		268	Insulet Corp ^(a)	43,770		1,890
	$		15,152	K2M Group Holdings Inc ^(a)	118,080		1,901
				LDR Holding Corp ^(a)	48,000		1,653
Building Materials - 0.72%				Ocular Therapeutix Inc ^(a)	45,680		697
Eagle Materials Inc	22,340		1,953	OraSure Technologies Inc ^(a)	133,600		1,196
PGT Inc ^(a)	181,380		1,706
				STAAR Surgical Co ^(a)	72,590		695
	$		3,659		$		10,546

Chemicals - 0.24%				Healthcare - Services - 3.81%
OM Group Inc	47,270		1,230	Acadia Healthcare Co Inc ^(a)	113,950		7,071
				Centene Corp ^(a)	60,490		5,606
Commercial Services - 9.37%				HealthSouth Corp	166,240		6,704
ABM Industries Inc	149,700		4,138		$		19,381
Corporate Executive Board Co	42,810		3,155
DeVry Education Group Inc	58,713		2,842	Holding Companies - Diversified - 0.18%
				FCB Financial Holdings Inc ^(a)	41,000		941
Huron Consulting Group Inc ^(a)	83,490		5,812
Korn/Ferry International ^(a)	212,360		5,931
Live Nation Entertainment Inc ^(a)	227,350		5,911	Home Builders - 0.50%
On Assignment Inc ^(a)	116,370		3,387	Installed Building Products Inc ^(a)	176,771		2,565
PAREXEL International Corp ^(a)	104,400		5,670
RPX Corp ^(a)	130,194		1,829
Team Health Holdings Inc ^(a)	144,120		9,013	Insurance - 4.19%
	$		47,688	Aspen Insurance Holdings Ltd	153,380		6,692
				CNO Financial Group Inc	353,056		6,401
Computers - 4.01%				Horace Mann Educators Corp	117,350		3,568
A10 Networks Inc ^(a)	67,580		297	Navigators Group Inc/The ^(a)	14,100		960


Schedule of Investments
SmallCap Blend Fund
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)		Shares Held	Value(000			's)

Insurance (continued)				REITS (continued)
Validus Holdings Ltd	92,931	$	3,697	Education Realty Trust Inc		325,775		$	3,668
	$		21,318	EPR Properties		61,430			3,446
				First Industrial Realty Trust Inc		300,690			5,872
Internet - 1.78%				Kilroy Realty Corp		69,630			4,717
CDW Corp/DE	216,947		6,691	RLJ Lodging Trust		202,440			6,523
Intralinks Holdings Inc ^(a)	168,500		1,456
				Strategic Hotels & Resorts Inc ^(a)		184,892			2,376
Rubicon Project Inc/The ^(a)	81,022		928
				Sunstone Hotel Investors Inc		388,950			5,955
	$		9,075				$		46,670

Investment Companies - 0.18%				Retail - 7.63%
Medley Capital Corp	77,540		901	Abercrombie & Fitch Co		98,439			3,296
				Brown Shoe Co Inc		255,090			6,783
Iron & Steel - 0.99%				Kirkland's Inc ^(a)		98,595			1,755
Worthington Industries Inc	130,537		5,045	Office Depot Inc ^(a)		1,386,650			7,238
				Penske Automotive Group Inc		111,719			5,054
				Red Robin Gourmet Burgers Inc ^(a)		59,060			3,247
Leisure Products & Services - 0.83%				Rite Aid Corp ^(a)		1,240,280			6,511
Sabre Corp	246,000		4,231	Wendy's Co/The		617,090			4,949
							$		38,833
Machinery - Diversified - 0.91%
IDEX Corp	61,680		4,621	Savings & Loans - 0.71%
				Oritani Financial Corp		52,570			776
				Provident Financial Services Inc		155,400			2,833
Metal Fabrication & Hardware - 0.55%							$		3,609
Mueller Water Products Inc - Class A	283,898		2,802
				Semiconductors - 1.22%
				Entegris Inc ^(a)		317,380			4,310
Mining - 0.66%				Micrel Inc		156,230			1,897
US Silica Holdings Inc	74,697		3,354				$		6,207

				Software - 6.35%
Miscellaneous Manufacturing - 1.80%				2U Inc ^(a)		146,000			2,657
AO Smith Corp	126,630		6,756	Acxiom Corp ^(a)		217,400			4,096
Blount International Inc ^(a)	158,507		2,427	Advent Software Inc		142,800			4,935
	$		9,183	Amber Road Inc ^(a)		119,134			1,590
				Aspen Technology Inc ^(a)		179,350			6,623
Oil & Gas - 3.28%
Carrizo Oil & Gas Inc ^(a)	92,130		4,785	Blackbaud Inc		81,860			3,643
				HubSpot Inc ^(a)		9,950			355
Energy XXI Bermuda Ltd	169,900		1,306	Mavenir Systems Inc ^(a)		121,680			1,492
Halcon Resources Corp ^(a)	577,360		1,796
				MobileIron Inc ^(a)		97,477			981
Kodiak Oil & Gas Corp ^(a)	311,680		3,363
RSP Permian Inc ^(a)	114,500		2,802	SYNNEX Corp		86,400			5,977
Sanchez Energy Corp ^(a)	154,700		2,641				$		32,349
	$		16,693	Telecommunications - 4.05%
				Aerohive Networks Inc ^(a)		50,840			254
Oil & Gas Services - 1.27%				ARRIS Group Inc ^(a)		274,521			8,241
Basic Energy Services Inc ^(a)	121,010		1,561
Flotek Industries Inc ^(a)	117,255		2,598	Plantronics Inc		100,650			5,221
				RF Micro Devices Inc ^(a)		529,160			6,884
RPC Inc	139,930		2,295
	$		6,454				$		20,600

Pharmaceuticals - 3.01%				Transportation - 0.98%
Achaogen Inc ^(a)	48,100		511	ArcBest Corp		72,760			2,816
				Navigator Holdings Ltd ^(a)		90,340			2,189
Aratana Therapeutics Inc ^(a)	80,058		897
Array BioPharma Inc ^(a)	190,870		685				$		5,005
Cerulean Pharma Inc ^(a)	98,000		475	TOTAL COMMON STOCKS			$		489,136
Clovis Oncology Inc ^(a)	16,250		969	INVESTMENT COMPANIES - 3.49%		Shares Held	Value(000			's)
Concert Pharmaceuticals Inc ^(a)	59,650		873
Nektar Therapeutics ^(a)	88,990		1,227	Publicly Traded Investment Fund - 3.49%
Orexigen Therapeutics Inc ^(a)	157,200		638	Goldman Sachs Financial Square Funds -		17,750,004			17,750
Prestige Brands Holdings Inc ^(a)	163,410		5,788	Government Fund
ProQR Therapeutics NV ^(a)	22,625		290
Proteon Therapeutics Inc ^(a)	54,850		549	TOTAL INVESTMENT COMPANIES			$		17,750
Revance Therapeutics Inc ^(a)	22,376		451	Total Investments			$		506,886
SCYNEXIS Inc ^(a)	64,600		573	Other Assets in Excess of Liabilities, Net - 0.43%			$		2,196
Vanda Pharmaceuticals Inc ^(a)	61,245		736	TOTAL NET ASSETS - 100.00%			$		509,082
Zafgen Inc ^(a)	30,590		652
	$		15,314	(a) Non-Income Producing Security
Publicly Traded Investment Fund - 0.19%				(b)	Security is Illiquid
THL Credit Inc	73,540		946	(c)	Fair value of these investments is determined in good faith by the Manager
					under procedures established and periodically reviewed by the Board of
					Directors. At the end of the period, the fair value of these securities totaled
REITS - 9.17%					$0 or 0.00% of net assets.
Brandywine Realty Trust	400,310		6,177
Colony Financial Inc	244,160		5,440
CubeSmart	118,600		2,496

See accompanying notes				261


Schedule of Investments
SmallCap Value Fund II
October 31, 2014



COMMON STOCKS - 96.06%	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Advertising - 0.07%				Automobile Parts & Equipment (continued)
Harte-Hanks Inc	110,768	$	721	Standard Motor Products Inc	11,035	$	436
Marchex Inc	13,949		54	Strattec Security Corp	3,247		337
MDC Partners Inc	5,070		105	Superior Industries International Inc	54,222		1,058
Sizmek Inc ^(a)	31,081		178	Supreme Industries Inc	16,313		109
ValueVision Media Inc ^(a)	10,662		60	Tenneco Inc ^(a)	80,325		4,206
	$		1,118	Titan International Inc	49,226		520
					$		12,474
Aerospace & Defense - 2.32%
AAR Corp	91,093		2,414	Banks - 10.10%
Allied Defense Group Inc/The ^(a),(b),(c)	2,055		—	1st Constitution Bancorp ^(a)	840		9
Arotech Corp ^(a)	9,039		27	1st Source Corp	29,324		918
CPI Aerostructures Inc ^(a)	800		8	1st United Bancorp Inc/Boca Raton	16,856		149
Cubic Corp	6,818		329	Alliance Bancorp Inc of Pennsylvania	942		16
Curtiss-Wright Corp	97,477		6,746	American National Bankshares Inc	2,818		69
Ducommun Inc ^(a)	31,248		826	American River Bankshares ^(a)	5,499		52
Esterline Technologies Corp ^(a)	171,091		20,036	Ameris Bancorp	34,807		862
Kaman Corp	2,596		112	AmeriServ Financial Inc	22,099		70
Kratos Defense & Security Solutions Inc ^(a)	102,536		714	Ames National Corp	2,827		70
LMI Aerospace Inc ^(a)	14,322		188	Arrow Financial Corp	3,383		93
Moog Inc ^(a)	21,573		1,652	ASB Bancorp Inc ^(a)	600		12
National Presto Industries Inc	1,444		91	Associated Banc-Corp	114,416		2,151
Orbital Sciences Corp ^(a)	55,402		1,457	Bancorp Inc/DE ^(a)	4,190		40
SIFCO Industries Inc	610		21	BancorpSouth Inc	89,049		2,051
Teledyne Technologies Inc ^(a)	15,171		1,572	Bank of Commerce Holdings	1,302		8
	$		36,193	Bank of Florida Corp ^(a),(b),(c)	6,269		—
				Bank of Marin Bancorp	1,767		88
Agriculture - 0.19%				Banner Corp	6,243		269
Alliance One International Inc ^(a)	243,736		495	Bar Harbor Bankshares	450		13
Andersons Inc/The	6,853		436	BBCN Bancorp Inc	16,276		230
Griffin Land & Nurseries Inc	872		23	BCB Bancorp Inc	1,563		20
MGP Ingredients Inc	5,923		73	BNC Bancorp	6,055		103
Universal Corp/VA	40,866		1,819	Boston Private Financial Holdings Inc	83,905		1,103
Vector Group Ltd	5,329		119	Bryn Mawr Bank Corp	13,609		419
	$		2,965	Camden National Corp	2,335		96
				Capital Bank Financial Corp ^(a)	295,012		7,637
Airlines - 0.70%
Hawaiian Holdings Inc ^(a)	59,421		1,030	Capital City Bank Group Inc	15,728		237
JetBlue Airways Corp ^(a)	645,065		7,444	Cardinal Financial Corp	5,768		111
Republic Airways Holdings Inc ^(a)	111,285		1,393	Carolina Bank Holdings Inc ^(a)	378		4
				Cascade Bancorp ^(a)	18,417		94
SkyWest Inc	90,777		1,046
	$		10,913	Cathay General Bancorp	92,552		2,444
				Centerstate Banks Inc	5,333		62
Apparel - 1.79%				Central Pacific Financial Corp	15,529		294
Columbia Sportswear Co	14,134		545	Century Bancorp Inc/MA	1,147		44
Crocs Inc ^(a)	15,652		183	Chemical Financial Corp	24,096		717
Delta Apparel Inc ^(a)	6,921		73	Citizens & Northern Corp	4,694		94
Iconix Brand Group Inc ^(a)	106,831		4,275	Citizens First Corp ^(a)	300		3
Lakeland Industries Inc ^(a)	6,346		89	City Holding Co	3,175		143
Perry Ellis International Inc ^(a)	29,937		612	CNB Financial Corp/PA	4,475		81
Quiksilver Inc ^(a)	170,811		298	CoBiz Financial Inc	10,654		128
Rocky Brands Inc	8,535		112	Codorus Valley Bancorp Inc	1,132		24
Skechers U.S.A. Inc ^(a)	63,916		3,499	Colony Bankcorp Inc ^(a)	706		5
Steven Madden Ltd ^(a)	274,025		8,591	Columbia Banking System Inc	37,765		1,049
Superior Uniform Group Inc	4,414		106	Community Bank System Inc	38,908		1,484
Unifi Inc ^(a)	29,408		823	Community Trust Bancorp Inc	5,635		203
Weyco Group Inc	2,254		70	Community West Bancshares	1,308		8
Wolverine World Wide Inc	322,819		8,761	CommunityOne Bancorp ^(a)	137		1
	$		28,037	ConnectOne Bancorp Inc	6,712		124
				Customers Bancorp Inc ^(a)	4,921		94
Automobile Manufacturers - 0.06%				CVB Financial Corp	18,636		294
Wabash National Corp ^(a)	83,400		859
				Eastern Virginia Bankshares Inc ^(a)	851		5
				Enterprise Bancorp Inc/MA	2,233		53
Automobile Parts & Equipment - 0.80%				Enterprise Financial Services Corp	8,691		164
Accuride Corp ^(a)	3,330		16	Evans Bancorp Inc	387		9
Cooper Tire & Rubber Co	37,059		1,194	Farmers Capital Bank Corp ^(a)	4,587		103
Cooper-Standard Holding Inc ^(a)	2,583		141	Fidelity Southern Corp	10,240		157
Dana Holding Corp	57,003		1,166	Financial Institutions Inc	21,913		551
Federal-Mogul Holdings Corp ^(a)	69,385		1,083	First Bancorp Inc/ME	2,674		47
Fuel Systems Solutions Inc ^(a)	24,630		227	First BanCorp/Puerto Rico ^(a)	64,216		334
Meritor Inc ^(a)	40,598		467	First Bancorp/Troy NC	22,476		407
Miller Industries Inc/TN	23,545		465	First Bancshares Inc/MS	1,620		24
Modine Manufacturing Co ^(a)	33,372		428	First Busey Corp	68,766		430
Motorcar Parts of America Inc ^(a)	5,432		158	First Business Financial Services Inc	2,266		106
Remy International Inc	4,286		79	First Citizens BancShares Inc/NC	5,977		1,501
Spartan Motors Inc	67,538		384	First Commonwealth Financial Corp	204,574		1,913
See accompanying notes				263


Schedule of Investments
SmallCap Value Fund II
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Banks (continued)				Banks (continued)
First Community Bancshares Inc/VA	23,836	$	390	Prosperity Bancshares Inc	205,752	$	12,425
First Connecticut Bancorp Inc/Farmington CT	8,549		133	QCR Holdings Inc	891		16
First Financial Bancorp	45,853		805	Renasant Corp	35,001		1,055
First Financial Bankshares Inc	4,902		156	Republic Bancorp Inc/KY	11,271		273
First Financial Corp/IN	10,514		365	Republic First Bancorp Inc ^(a)	5,488		22
First Financial Service Corp ^(a)	800		3	Royal Bancshares of Pennsylvania Inc ^(a)	1,600		3
First Interstate BancSystem Inc	20,652		605	S&T Bancorp Inc	27,703		764
First Merchants Corp	86,059		1,949	Salisbury Bancorp Inc	284		8
First Midwest Bancorp Inc/IL	184,722		3,102	Sandy Spring Bancorp Inc	44,712		1,154
First NBC Bank Holding Co ^(a)	2,876		106	SB Financial Group Inc	2,685		25
First of Long Island Corp/The	3,768		99	Select Bancorp Inc ^(a)	2,142		15
First United Corp ^(a)	1,489		13	Sierra Bancorp	21,188		364
First West Virginia Bancorp	163		3	Simmons First National Corp	3,513		148
FirstMerit Corp	828,175		15,197	South State Corp	4,249		256
FNB Corp/PA	130,495		1,669	Southcoast Financial Corp ^(a)	598		4
Franklin Financial Corp/VA ^(a)	4,962		103	Southern Community Financial - Rights	13,075		12
Fulton Financial Corp	206,031		2,448	(a),(b),(c)
German American Bancorp Inc	3,830		114	Southern First Bancshares Inc ^(a)	357		5
Glacier Bancorp Inc	26,428		758	Southern National Bancorp of Virginia Inc	1,953		23
Great Southern Bancorp Inc	3,344		128	Southside Bancshares Inc	3,812		128
Guaranty Bancorp	5,097		80	Southwest Bancorp Inc	18,619		336
Guaranty Federal Bancshares Inc	541		7	State Bank Financial Corp	6,480		116
Hancock Holding Co	47,160		1,659	Stock Yards Bancorp Inc	4,270		142
Hanmi Financial Corp	6,211		133	Stonegate Bank	2,973		81
Hawthorn Bancshares Inc	1,619		22	Suffolk Bancorp	3,387		78
Heartland Financial USA Inc	5,031		133	Summit State Bank	804		10
Heritage Commerce Corp	7,073		62	Sun Bancorp Inc/NJ ^(a)	7,345		148
Heritage Financial Corp/WA	8,618		151	Susquehanna Bancshares Inc	319,108		3,131
Horizon Bancorp/IN	3,612		93	Sussex Bancorp	1,215		12
Hudson Valley Holding Corp	2,818		64	Synovus Financial Corp	71,985		1,826
Iberiabank Corp	39,009		2,687	Talmer Bancorp Inc	5,239		73
Independent Bank Corp/MI	13,035		158	Texas Capital Bancshares Inc ^(a)	4,742		290
Independent Bank Corp/Rockland MA	4,193		171	Tompkins Financial Corp	5,699		287
International Bancshares Corp	79,088		2,244	Towne Bank/Portsmouth VA	32,200		488
Intervest Bancshares Corp	10,064		98	Trico Bancshares	3,853		101
Lakeland Bancorp Inc	25,386		279	TrustCo Bank Corp NY	43,521		317
Lakeland Financial Corp	10,104		418	Trustmark Corp	54,412		1,324
LNB Bancorp Inc	10,575		148	UMB Financial Corp	7,273		433
Macatawa Bank Corp	7,247		38	Umpqua Holdings Corp	221,552		3,899
MainSource Financial Group Inc	47,207		859	Union Bankshares Corp	433,836		9,752
MB Financial Inc	111,053		3,504	United Bancshares Inc/OH	900		13
MBT Financial Corp ^(a)	9,505		44	United Bankshares Inc/WV	13,410		460
Mercantile Bank Corp	13,108		259	United Community Banks Inc/GA	22,719		410
Merchants Bancshares Inc/VT	1,547		46	United Security Bancshares/Fresno CA ^(a)	1,689		10
Metro Bancorp Inc ^(a)	22,873		573	Unity Bancorp Inc	165		2
Mid Penn Bancorp Inc	119		2	Univest Corp of Pennsylvania	25,565		524
MidSouth Bancorp Inc	3,305		63	Valley National Bancorp	39,648		396
MidWestOne Financial Group Inc	4,157		111	ViewPoint Financial Group Inc	7,072		193
National Bankshares Inc	2,226		70	Walker & Dunlop Inc ^(a)	5,076		82
National Penn Bancshares Inc	207,986		2,140	Washington Trust Bancorp Inc	11,871		455
NBT Bancorp Inc	21,467		551	Webster Financial Corp	666,591		20,892
NewBridge Bancorp ^(a)	11,342		101	WesBanco Inc	39,010		1,344
Northeast Bancorp	1,364		12	West Bancorporation Inc	4,750		79
Northrim BanCorp Inc	4,214		122	Westamerica Bancorporation	4,717		233
OFG Bancorp	57,070		888	Western Alliance Bancorp ^(a)	32,250		859
Old Line Bancshares Inc	2,086		33	Wilshire Bancorp Inc	32,064		318
Old National Bancorp/IN	118,137		1,719	Wintrust Financial Corp	106,758		4,945
Old Second Bancorp Inc ^(a)	11,663		56		$		157,818
Opus Bank ^(a)	1,526		40
Pacific Continental Corp	10,736		155	Beverages - 0.06%
Pacific Mercantile Bancorp ^(a)	2,516		18	Coca-Cola Bottling Co Consolidated	7,658		693
				Craft Brew Alliance Inc ^(a)	13,254		184
PacWest Bancorp	33,808		1,442
Park National Corp	2,288		193		$		877
Park Sterling Corp	37,436		286	Biotechnology - 0.28%
Patriot National Bancorp Inc ^(a)	2,129		4	Achillion Pharmaceuticals Inc ^(a)	13,104		154
Peapack Gladstone Financial Corp	3,649		67	AMAG Pharmaceuticals Inc ^(a)	84,525		2,790
Penns Woods Bancorp Inc	1,393		68	BioCryst Pharmaceuticals Inc ^(a)	4,318		51
Peoples Bancorp Inc/OH	18,964		468	Cytokinetics Inc ^(a)	10,125		37
Peoples Bancorp of North Carolina Inc	1,797		31	Emergent Biosolutions Inc ^(a)	21,271		481
Pinnacle Financial Partners Inc	47,535		1,864	Enzo Biochem Inc ^(a)	23,582		123
Preferred Bank/Los Angeles CA	9,647		257	Harvard Bioscience Inc ^(a)	9,210		44
Premier Financial Bancorp Inc	8,519		124	Medicines Co/The ^(a)	1,750		44
PrivateBancorp Inc	123,901		4,004	NPS Pharmaceuticals Inc ^(a)	2,148		59


Schedule of Investments
SmallCap Value Fund II
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Biotechnology (continued)				Commercial Services (continued)
Pacific Biosciences of California Inc ^(a)	5,500	$	36	CBIZ Inc ^(a)	80,622	$	745
Prothena Corp PLC ^(a)	5,971		131	CDI Corp	35,457		609
Rigel Pharmaceuticals Inc ^(a)	26,194		52	Civeo Corp	24,113		294
RTI Surgical Inc ^(a)	64,238		327	CRA International Inc ^(a)	13,333		400
Spectrum Pharmaceuticals Inc ^(a)	14,626		111	Cross Country Healthcare Inc ^(a)	48,738		471
	$		4,440	Deluxe Corp	11,325		689
				DeVry Education Group Inc	69,845		3,381
Building Materials - 1.09%				Edgewater Technology Inc ^(a)	10,657		75
Builders FirstSource Inc ^(a)	2,906		17
				Education Management Corp ^(a)	1,845		1
Continental Materials Corp ^(a)	657		11
Gibraltar Industries Inc ^(a)	53,777		820	Electro Rent Corp	25,027		382
				Ennis Inc	50,932		755
Griffon Corp	149,659		1,839	Franklin Covey Co ^(a)	5,397		106
Lennox International Inc	100,025		8,894	FTI Consulting Inc ^(a)	51,959		2,098
Louisiana-Pacific Corp ^(a)	180,716		2,639
				Global Cash Access Holdings Inc ^(a)	55,648		406
LSI Industries Inc	21,687		155	Great Lakes Dredge & Dock Corp ^(a)	115,127		805
Masonite International Corp ^(a)	4,342		235
				Green Dot Corp ^(a)	5,098		122
Nortek Inc ^(a)	1,487		124
PGT Inc ^(a)	8,198		77	Hackett Group Inc/The	18,490		130
				HealthEquity Inc ^(a)	1,959		40
Quanex Building Products Corp	14,304		286	Heidrick & Struggles International Inc	8,505		177
Simpson Manufacturing Co Inc	8,088		268	Hill International Inc ^(a)	24,773		96
Universal Forest Products Inc	34,839		1,741	Hudson Global Inc ^(a)	611		2
	$		17,106	Huron Consulting Group Inc ^(a)	8,752		609
Chemicals - 1.59%				ICF International Inc ^(a)	221,100		8,035
A Schulman Inc	53,587		1,898	Intersections Inc	8,191		33
Aceto Corp	34,421		783	ITT Educational Services Inc ^(a)	6,299		64
Axiall Corp	40,287		1,623	K12 Inc ^(a)	15,733		195
Cabot Corp	13,339		619	KAR Auction Services Inc	500,625		15,199
Ferro Corp ^(a)	11,313		148	Kelly Services Inc	66,182		1,167
Hawkins Inc	2,621		101	Korn/Ferry International ^(a)	78,577		2,195
Innophos Holdings Inc	1,847		105	Landauer Inc	3,690		132
Innospec Inc	3,971		160	Lincoln Educational Services Corp	4,984		13
Intrepid Potash Inc ^(a)	12,961		174	Live Nation Entertainment Inc ^(a)	91,059		2,368
KMG Chemicals Inc	2,880		51	Matthews International Corp	18,545		854
Kraton Performance Polymers Inc ^(a)	27,635		494	McGrath RentCorp	18,560		678
Kronos Worldwide Inc	18,855		254	MoneyGram International Inc ^(a)	63,689		547
Landec Corp ^(a)	42,906		540	Monster Worldwide Inc ^(a)	170,773		660
Minerals Technologies Inc	16,288		1,250	Multi-Color Corp	10,314		508
Oil-Dri Corp of America	1,117		34	National Research Corp ^(a)	1,848		29
Olin Corp	117,190		2,841	Navigant Consulting Inc ^(a)	95,735		1,473
OM Group Inc	78,427		2,042	PDI Inc ^(a)	13,313		24
Penford Corp ^(a)	8,167		154	Perceptron Inc	7,593		76
Quaker Chemical Corp	1,185		97	Performant Financial Corp ^(a)	5,560		48
Rentech Inc ^(a)	32,280		51	PHH Corp ^(a)	105,858		2,508
Sensient Technologies Corp	18,262		1,081	PRGX Global Inc ^(a)	8,910		47
Stepan Co	3,112		138	QC Holdings Inc ^(a)	400		1
Taminco Corp ^(a)	343,075		8,882	Quad/Graphics Inc	47,082		1,038
Tronox Ltd	43,591		1,054	RCM Technologies Inc ^(a)	13,071		99
Zep Inc	19,970		321	Rent-A-Center Inc/TX	147,996		4,584
	$		24,895	Resources Connection Inc	25,806		399
				RPX Corp ^(a)	10,110		142
Coal - 0.17%				ServiceMaster Global Holdings Inc ^(a)	447,400		10,729
Cloud Peak Energy Inc ^(a)	86,383		1,034	Tree.com Inc ^(a)	5,970		221
Hallador Energy Co	1,990		24	TriNet Group Inc ^(a)	3,263		98
SunCoke Energy Inc ^(a)	63,438		1,516	Universal Security Instruments Inc ^(a)	1,000		6
Westmoreland Coal Co ^(a)	2,611		96	Universal Technical Institute Inc	8,712		103
	$		2,670	Versar Inc ^(a)	8,300		27
Commercial Services - 5.08%				Viad Corp	45,522		1,161
				Volt Information Sciences Inc ^(a)	19,580		162
Aaron's Inc	75,168		1,861
ABM Industries Inc	27,515		760		$		79,430
Albany Molecular Research Inc ^(a)	41,173		958	Computers - 2.84%
AMN Healthcare Services Inc ^(a)	8,851		152	Agilysys Inc ^(a)	33,012		373
ARC Document Solutions Inc ^(a)	28,751		292	Astro-Med Inc	9,156		123
Ascent Capital Group Inc ^(a)	14,951		962	CACI International Inc ^(a)	175,677		14,456
Avalon Holdings Corp ^(a)	3,917		14	Ciber Inc ^(a)	188,550		617
Avis Budget Group Inc ^(a)	82,367		4,592	Computer Task Group Inc	10,477		92
Barrett Business Services Inc	2,355		55	Convergys Corp	259,061		5,225
Bridgepoint Education Inc ^(a)	19,042		240	Datalink Corp ^(a)	5,764		73
Brink's Co/The	37,720		793	Electronics For Imaging Inc ^(a)	35,957		1,644
Cambium Learning Group Inc ^(a)	12,732		19	Engility Holdings Inc ^(a)	26,479		1,143
Cardtronics Inc ^(a)	4,150		159	ExlService Holdings Inc ^(a)	3,657		102
Career Education Corp ^(a)	9,855		57	Hutchinson Technology Inc ^(a)	7,912		28
Carriage Services Inc	24,932		497	iGate Corp ^(a)	298,050		11,043
Cartesian Inc ^(a)	650		3	Imation Corp ^(a)	53,839		158


Schedule of Investments
SmallCap Value Fund II
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Computers (continued)				Diversified Financial Services (continued)
Insight Enterprises Inc ^(a)	94,633	$	2,154	Janus Capital Group Inc	297,406	$	4,458
Key Tronic Corp ^(a)	16,991		140	JMP Group Inc	11,116		81
Leidos Holdings Inc	373		14	KCG Holdings Inc ^(a)	31,588		337
Lexmark International Inc	50,608		2,184	LPL Financial Holdings Inc	213,650		8,843
Mentor Graphics Corp	18,709		396	Manning & Napier Inc	13,224		209
Mercury Systems Inc ^(a)	24,944		349	Marlin Business Services Corp	12,713		268
NCI Inc ^(a)	319		3	MicroFinancial Inc	8,367		70
PAR Technology Corp ^(a)	9,256		48	Nelnet Inc	23,914		1,138
Planar Systems Inc ^(a)	24,121		87	NewStar Financial Inc ^(a)	59,499		814
Qualstar Corp ^(a)	4,617		6	Nicholas Financial Inc ^(a)	3,018		37
Quantum Corp ^(a)	38,915		50	Oppenheimer Holdings Inc	27,532		676
Qumu Corp ^(a)	8,848		132	Piper Jaffray Cos ^(a)	14,938		844
Radisys Corp ^(a)	15,105		38	Regional Management Corp ^(a)	3,122		36
Spansion Inc ^(a)	51,891		1,068	Springleaf Holdings Inc ^(a)	4,188		157
StarTek Inc ^(a)	11,737		88	Stifel Financial Corp ^(a)	22,323		1,061
Super Micro Computer Inc ^(a)	8,608		275	SWS Group Inc ^(a)	12,175		90
Sykes Enterprises Inc ^(a)	78,637		1,694	Walter Investment Management Corp ^(a)	7,010		159
TeleTech Holdings Inc ^(a)	2,132		55		$		30,589
Unisys Corp ^(a)	17,224		442
VeriFone Systems Inc ^(a)	3,736		139	Electric - 0.97%
				Abengoa Yield plc ^(a)	4,623		150
	$		44,439	Allete Inc	7,098		371
Consumer Products - 0.41%				Ameresco Inc ^(a)	3,589		30
ACCO Brands Corp ^(a)	205,547		1,692	Atlantic Power Corp	41,001		91
Acme United Corp	1,796		31	Avista Corp	23,588		836
Central Garden and Pet Co ^(a)	20,752		166	Black Hills Corp	7,624		417
Central Garden and Pet Co - A Shares ^(a)	51,392		441	Cleco Corp	28,543		1,535
CSS Industries Inc	13,466		384	Dynegy Inc ^(a)	30,342		925
Helen of Troy Ltd ^(a)	55,847		3,454	El Paso Electric Co	9,979		378
Spectrum Brands Holdings Inc	2,990		271	Empire District Electric Co/The	9,932		282
	$		6,439	EnerNOC Inc ^(a)	5,406		80
				Genie Energy Ltd ^(a)	9,956		72
Cosmetics & Personal Care - 0.03%				IDACORP Inc	27,954		1,767
CCA Industries Inc ^(a)	500		2
Revlon Inc ^(a)	12,339		423	MGE Energy Inc	17,449		776
				NorthWestern Corp	12,450		658
	$		425	NRG Yield Inc	7,049		352
Distribution & Wholesale - 1.00%				Ormat Technologies Inc	34,280		993
ADDvantage Technologies Group Inc ^(a)	3,841		9	Otter Tail Corp	7,668		238
Beacon Roofing Supply Inc ^(a)	7,937		220	Pike Corp ^(a)	50,171		599
Core-Mark Holding Co Inc	31,030		1,801	PNM Resources Inc	35,118		1,013
H&E Equipment Services Inc	9,171		343	Portland General Electric Co	31,961		1,164
Houston Wire & Cable Co	2,240		30	Synthesis Energy Systems Inc ^(a)	7,503		8
ScanSource Inc ^(a)	32,564		1,243	UIL Holdings Corp	55,225		2,272
Speed Commerce Inc ^(a)	15,359		46	Unitil Corp	6,204		216
Titan Machinery Inc ^(a)	6,728		93		$		15,223
United Stationers Inc	26,953		1,125	Electrical Components & Equipment - 1.02%
WESCO International Inc ^(a)	130,700		10,771
				Advanced Energy Industries Inc ^(a)	2,278		45
	$		15,681	Encore Wire Corp	15,383		583
Diversified Financial Services - 1.96%				EnerSys	21,390		1,343
AeroCentury Corp ^(a)	423		5	General Cable Corp	100,726		1,428
Aircastle Ltd	102,803		1,962	GrafTech International Ltd ^(a)	161,560		693
Arlington Asset Investment Corp	3,704		101	Insteel Industries Inc	5,896		141
Asta Funding Inc ^(a)	11,856		100	Littelfuse Inc	113,388		11,060
Atlanticus Holdings Corp ^(a)	16,062		22	Magnetek Inc ^(a)	208		6
BGC Partners Inc	24,520		208	Orion Energy Systems Inc ^(a)	22,810		131
Calamos Asset Management Inc	40,098		550	Powell Industries Inc	2,820		128
California First National Bancorp	2,983		45	PowerSecure International Inc ^(a)	11,590		129
Consumer Portfolio Services Inc ^(a)	6,148		43	SunPower Corp ^(a)	8,875		283
Cowen Group Inc ^(a)	186,101		752	Ultralife Corp ^(a)	14,398		46
Credit Acceptance Corp ^(a)	1,280		189		$		16,016
Ellie Mae Inc ^(a)	124,225		4,768
FBR & Co ^(a)	2,800		68	Electronics - 1.79%
				AVX Corp	45,732		660
Federal Agricultural Mortgage Corp	14,600		486	Ballantyne Strong Inc ^(a)	13,019		58
First Marblehead Corp/The ^(a)	1,274		3
				Bel Fuse Inc	15,033		425
FXCM Inc	7,749		128	Benchmark Electronics Inc ^(a)	91,464		2,169
Gain Capital Holdings Inc	12,200		104	Blonder Tongue Laboratories ^(a)	1,523		2
GAMCO Investors Inc	2,760		228	Brady Corp	41,232		984
GFI Group Inc	7,803		43	Checkpoint Systems Inc ^(a)	50,903		674
Higher One Holdings Inc ^(a)	6,340		16
				Coherent Inc ^(a)	4,739		309
Home Loan Servicing Solutions Ltd	14,620		281	CTS Corp	64,718		1,191
Imperial Holdings Inc ^(a)	3,056		19
				CyberOptics Corp ^(a)	7,092		65
INTL. FCStone Inc ^(a)	13,386		242
Investment Technology Group Inc ^(a)	52,870		948	Electro Scientific Industries Inc	38,164		271


Schedule of Investments
SmallCap Value Fund II
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Electronics (continued)				Entertainment (continued)
ESCO Technologies Inc	24,940	$	948	Marriott Vacations Worldwide Corp	54,764	$	3,802
FARO Technologies Inc ^(a)	669		37	National CineMedia Inc	24,859		396
Frequency Electronics Inc ^(a)	11,821		134	Penn National Gaming Inc ^(a)	52,807		691
GSI Group Inc ^(a)	14,091		181	Pinnacle Entertainment Inc ^(a)	2,043		52
Identiv Inc ^(a)	779		7	RCI Hospitality Holdings Inc ^(a)	13,279		158
II-VI Inc ^(a)	11,640		157	Reading International Inc ^(a)	5,295		53
IntriCon Corp ^(a)	448		3	Speedway Motorsports Inc	56,888		1,113
Itron Inc ^(a)	19,791		771		$		8,964
Kemet Corp ^(a)	51,752		248
LGL Group Inc/The ^(a)	410		2	Environmental Control - 0.21%
LGL Group Inc/The - Warrants ^(a)	2,050		—	Covanta Holding Corp	105,758		2,334
				Energy Recovery Inc ^(a)	2,164		10
Methode Electronics Inc	12,366		487	Fuel Tech Inc ^(a)	10,245		42
Newport Corp ^(a)	23,712		425
NVE Corp ^(a)	821		59	Tetra Tech Inc	29,574		793
				TRC Cos Inc ^(a)	13,640		99
OSI Systems Inc ^(a)	2,961		210
Park Electrochemical Corp	6,249		161		$		3,278
Plexus Corp ^(a)	18,710		774	Food - 1.12%
Rofin-Sinar Technologies Inc ^(a)	21,748		487	Amcon Distributing Co	191		16
Rogers Corp ^(a)	2,215		151	B&G Foods Inc	7,490		221
Sanmina Corp ^(a)	207,368		5,199	Chiquita Brands International Inc ^(a)	95,819		1,383
Sparton Corp ^(a)	14,794		401	Darling Ingredients Inc ^(a)	26,193		461
Stoneridge Inc ^(a)	6,025		78	Dean Foods Co	63,468		934
Sypris Solutions Inc	37,183		127	Fresh Del Monte Produce Inc	112,932		3,626
Tech Data Corp ^(a)	54,223		3,238	Ingles Markets Inc	20,159		542
TTM Technologies Inc ^(a)	111,025		767	John B Sanfilippo & Son Inc	20,122		748
Viasystems Group Inc ^(a)	24,124		383	Lancaster Colony Corp	1,412		129
Vicon Industries Inc	1,971		3	Pilgrim's Pride Corp ^(a)	8,317		236
Video Display Corp ^(a)	300		1	Post Holdings Inc ^(a)	69,585		2,609
Vishay Intertechnology Inc	256,738		3,469	Sanderson Farms Inc	12,405		1,042
Vishay Precision Group Inc ^(a)	24,758		421	Seaboard Corp ^(a)	57		175
Watts Water Technologies Inc	25,144		1,524	Seneca Foods Corp - Class A ^(a)	22,810		613
Woodward Inc	4,303		220	Seneca Foods Corp - Class B ^(a)	39		1
ZAGG Inc ^(a)	7,145		48	Snyder's-Lance Inc	12,180		363
	$		27,929	SpartanNash Co	52,978		1,187
				SUPERVALU Inc ^(a)	53,255		459
Energy - Alternate Sources - 0.22%
Ascent Solar Technologies Inc ^(a)	4,164		7	Tootsie Roll Industries Inc	467		14
				TreeHouse Foods Inc ^(a)	25,828		2,200
FutureFuel Corp	5,135		68
Green Plains Inc	69,639		2,382	Weis Markets Inc	10,708		478
Ocean Power Technologies Inc ^(a)	12,856		13		$		17,437
Pacific Ethanol Inc ^(a)	5,522		78	Forest Products & Paper - 0.85%
Plug Power Inc ^(a)	28,437		134	Clearwater Paper Corp ^(a)	2,442		157
Renewable Energy Group Inc ^(a)	68,486		721	Domtar Corp	19,749		811
REX American Resources Corp ^(a)	725		53	KapStone Paper and Packaging Corp ^(a)	245,500		7,552
	$		3,456	Mercer International Inc ^(a)	49,723		625
Engineering & Construction - 0.57%				Neenah Paper Inc	4,791		292
Aegion Corp ^(a)	65,117		1,193	PH Glatfelter Co	82,351		2,078
				Resolute Forest Products Inc ^(a)	85,885		1,594
Argan Inc	5,015		174
Comfort Systems USA Inc	9,287		143	Schweitzer-Mauduit International Inc	5,311		229
Dycom Industries Inc ^(a)	20,002		628		$		13,338
EMCOR Group Inc	35,911		1,585	Gas - 0.46%
ENGlobal Corp ^(a)	18,947		25	Chesapeake Utilities Corp	3,432		166
Granite Construction Inc	26,270		969	Laclede Group Inc/The	21,604		1,097
Integrated Electrical Services Inc ^(a)	1,004		8	New Jersey Resources Corp	21,210		1,240
KBR Inc	1,972		38	Northwest Natural Gas Co	6,273		294
Layne Christensen Co ^(a)	36,836		265	ONE Gas Inc	9,546		363
MYR Group Inc ^(a)	6,413		166	Piedmont Natural Gas Co Inc	17,999		684
Orion Marine Group Inc ^(a)	29,753		326	South Jersey Industries Inc	15,289		897
Sterling Construction Co Inc ^(a)	13,551		120	Southwest Gas Corp	18,596		1,080
Tutor Perini Corp ^(a)	107,602		3,014	WGL Holdings Inc	28,282		1,329
VSE Corp	4,706		284		$		7,150
	$		8,938
				Hand & Machine Tools - 0.02%
Entertainment - 0.57%				Franklin Electric Co Inc	764		29
AMC Entertainment Holdings Inc	4,129		105	Hardinge Inc	13,003		146
Churchill Downs Inc	1,371		140	LS Starrett Co/The	5,475		81
Dover Downs Gaming & Entertainment Inc ^(a)	8,791		7	P&F Industries Inc ^(a)	1,773		14
Dover Motorsports Inc	3,447		8	Regal-Beloit Corp	324		23
DreamWorks Animation SKG Inc ^(a)	14,332		319
Eldorado Resorts Inc ^(a)	14,333		59		$		293
Eros International PLC ^(a)	3,653		68	Healthcare - Products - 3.98%
International Speedway Corp	55,793		1,748	Affymetrix Inc ^(a)	13,805		124
Isle of Capri Casinos Inc ^(a)	32,921		245	Alere Inc ^(a)	364,521		14,570
				Allied Healthcare Products Inc ^(a)	5,732		11


Schedule of Investments
SmallCap Value Fund II
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Healthcare - Products (continued)				Home Builders - 0.69%
Alphatec Holdings Inc ^(a)	29,509	$	45	AMREP Corp ^(a)	1,173	$	5
Analogic Corp	2,126		155	AV Homes Inc ^(a)	10,600		159
AngioDynamics Inc ^(a)	56,162		955	LGI Homes Inc ^(a)	3,255		63
AtriCure Inc ^(a)	2,101		37	M/I Homes Inc ^(a)	26,000		560
BioTelemetry Inc ^(a)	11,551		97	MDC Holdings Inc	57,649		1,408
CONMED Corp	55,967		2,350	Meritage Homes Corp ^(a)	15,156		557
CryoLife Inc	30,449		313	Orleans Homebuilders Inc ^(a),(b),(c)	7,702		—
Cutera Inc ^(a)	19,781		208	Ryland Group Inc/The	184,149		6,595
Cynosure Inc ^(a)	3,911		99	Skyline Corp ^(a)	4,473		16
Daxor Corp	200		1	Standard Pacific Corp ^(a)	52,633		389
Digirad Corp	15,358		66	TRI Pointe Homes Inc ^(a)	59,300		812
Exactech Inc ^(a)	3,415		73	WCI Communities Inc ^(a)	3,507		66
Greatbatch Inc ^(a)	44,796		2,249	William Lyon Homes ^(a)	4,509		107
Haemonetics Corp ^(a)	247,156		9,322		$		10,737
Hanger Inc ^(a)	19,494		466
Harvard Apparatus Regenerative Technology	2,302		14	Home Furnishings - 0.25%
Inc ^(a)				Bassett Furniture Industries Inc	11,504		200
ICU Medical Inc ^(a)	2,554		181	Daktronics Inc	3,260		43
				DTS Inc/CA ^(a)	3,580		107
Integra LifeSciences Holdings Corp ^(a)	221,421		11,317
Invacare Corp	46,247		726	Emerson Radio Corp	4,358		5
Iridex Corp ^(a)	470		4	Ethan Allen Interiors Inc	5,435		154
LeMaitre Vascular Inc	2,833		21	Flexsteel Industries Inc	11,772		404
Merit Medical Systems Inc ^(a)	349,536		5,296	Hooker Furniture Corp	12,863		197
Misonix Inc ^(a)	11,445		153	Kimball International Inc	51,619		927
Natus Medical Inc ^(a)	14,058		478	La-Z-Boy Inc	28,988		663
				Skullcandy Inc ^(a)	29,660		247
NuVasive Inc ^(a)	10,371		424
				Stanley Furniture Co Inc ^(a)	8,033		23
OraSure Technologies Inc ^(a)	17,292		155
				TiVo Inc ^(a)	13,455		176
Orthofix International NV ^(a)	11,766		345
				Universal Electronics Inc ^(a)	5,076		289
PhotoMedex Inc ^(a),(b)	2,943		11
				VOXX International Corp ^(a)	50,570		431
PhotoMedex Inc - Warrants ^(a),(b),(c)	430		—
SurModics Inc ^(a)	3,314		72		$		3,866
Symmetry Medical Inc ^(a)	77,809		770	Housewares - 0.07%
Teleflex Inc	94,578		10,793	Libbey Inc ^(a)	9,460		272
Tornier NV ^(a)	6,767		189	Lifetime Brands Inc	16,150		276
Wright Medical Group Inc ^(a)	5,045		159	NACCO Industries Inc	9,503		557
	$		62,249		$		1,105

Healthcare - Services - 3.64%				Insurance - 8.69%
Addus HomeCare Corp ^(a)	11,327		226	Ambac Financial Group Inc ^(a)	33,777		773
Alliance HealthCare Services Inc ^(a)	924		22	American Equity Investment Life Holding Co	415,419		10,722
Almost Family Inc ^(a)	6,090		180	American Independence Corp ^(a)	1,020		11
Amedisys Inc ^(a)	33,116		864	American National Insurance Co	1,810		207
American Shared Hospital Services ^(a)	2,738		6	Amerisafe Inc	3,584		149
Amsurg Corp ^(a)	351,619		18,990	AmTrust Financial Services Inc	2,479		111
Capital Senior Living Corp ^(a)	9,761		220	Argo Group International Holdings Ltd	54,185		3,023
Ensign Group Inc/The	297		12	Aspen Insurance Holdings Ltd	287,162		12,529
Five Star Quality Care Inc ^(a)	63,941		264	Atlantic American Corp	7,236		28
Gentiva Health Services Inc ^(a)	31,886		628	Baldwin & Lyons Inc	14,475		390
Health Net Inc/CA ^(a)	46,855		2,226	CNO Financial Group Inc	995,406		18,047
HealthSouth Corp	28,144		1,135	Donegal Group Inc	16,757		265
Healthways Inc ^(a)	45,219		701	EMC Insurance Group Inc	14,374		461
IPC The Hospitalist Co Inc ^(a)	2,131		89	Employers Holdings Inc	4,785		97
Kindred Healthcare Inc	120,997		2,631	Endurance Specialty Holdings Ltd	69,861		4,048
LHC Group Inc ^(a)	24,130		587	Enstar Group Ltd ^(a)	1,450		215
LifePoint Hospitals Inc ^(a)	229,748		16,082	FBL Financial Group Inc	60,771		3,014
Magellan Health Inc ^(a)	57,686		3,491	Federated National Holding Co	9,881		330
Medcath Corp ^(a),(b),(c)	31,637		—	Fidelity & Guaranty Life	6,079		145
Molina Healthcare Inc ^(a)	12,965		631	First Acceptance Corp ^(a)	19,254		49
National Healthcare Corp	3,045		184	First American Financial Corp	161,514		4,897
Select Medical Holdings Corp	134,372		1,938	Global Indemnity PLC ^(a)	20,767		602
Skilled Healthcare Group Inc ^(a)	3,434		24	Greenlight Capital Re Ltd ^(a)	39,585		1,285
SunLink Health Systems Inc ^(a)	4,000		7	Hallmark Financial Services Inc ^(a)	28,451		331
Triple-S Management Corp ^(a)	65,720		1,454	Hanover Insurance Group Inc/The	62,624		4,192
Universal American Corp/NY ^(a)	147,471		1,374	HCC Insurance Holdings Inc	279,348		14,579
WellCare Health Plans Inc ^(a)	43,068		2,924	HCI Group Inc	815		41
	$		56,890	Hilltop Holdings Inc ^(a)	77,964		1,718
Holding Companies - Diversified - 0.06%				Horace Mann Educators Corp	92,607		2,816
Harbinger Group Inc ^(a)	33,843		445	Independence Holding Co	14,456		205
National Bank Holdings Corp	10,630		208	Infinity Property & Casualty Corp	7,710		563
Resource America Inc	24,567		234	Investors Title Co	1,402		105
	$		887	Kansas City Life Insurance Co	1,251		62
				Kemper Corp	99,795		3,677
				Maiden Holdings Ltd	111,912		1,338


Schedule of Investments
SmallCap Value Fund II
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Insurance (continued)				Investment Companies (continued)
MBIA Inc ^(a)	298,875	$	2,917	TCP Capital Corp	352,575	$	5,955
Meadowbrook Insurance Group Inc	38,289		244		$		6,763
MGIC Investment Corp ^(a)	75,208		671
Montpelier Re Holdings Ltd ADR	158,242		5,244	Iron & Steel - 0.89%
				AK Steel Holding Corp ^(a)	34,790		263
National General Holdings Corp	6,883		129
National Security Group Inc/The	369		5	Carpenter Technology Corp	1,188		59
National Western Life Insurance Co	6,105		1,655	Commercial Metals Co	206,842		3,577
Navigators Group Inc/The ^(a)	26,566		1,809	Friedman Industries Inc	7,610		58
OneBeacon Insurance Group Ltd	10,270		163	Reliance Steel & Aluminum Co	123,425		8,329
Phoenix Cos Inc/The ^(a)	6,035		358	Schnitzer Steel Industries Inc	40,829		961
				Shiloh Industries Inc ^(a)	25,778		440
Platinum Underwriters Holdings Ltd	202,160		12,661	Universal Stainless & Alloy Products Inc ^(a)	9,234		237
Primerica Inc	14,134		723
ProAssurance Corp	6,265		293		$		13,924
Radian Group Inc	62,956		1,061	Leisure Products & Services - 0.26%
RLI Corp	10,934		543	Ambassadors Group Inc ^(a)	2,629		9
Safety Insurance Group Inc	17,814		1,111	Arctic Cat Inc	2,504		84
Security National Financial Corp ^(a)	852		4	Black Diamond Inc ^(a)	1,479		12
Selective Insurance Group Inc	109,463		2,827	Brunswick Corp/DE	9,130		427
StanCorp Financial Group Inc	45,696		3,179	Callaway Golf Co	130,153		1,020
State Auto Financial Corp	43,969		920	Escalade Inc	3,889		45
Stewart Information Services Corp	38,872		1,373	Interval Leisure Group Inc	2,673		56
Symetra Financial Corp	192,411		4,560	Johnson Outdoors Inc	9,893		298
Third Point Reinsurance Ltd ^(a)	11,005		168	Life Time Fitness Inc ^(a)	35,004		1,953
Unico American Corp ^(a)	5,796		67	Nautilus Inc ^(a)	3,541		47
United Fire Group Inc	48,423		1,572	Steiner Leisure Ltd ^(a)	3,134		132
Universal Insurance Holdings Inc	26,913		471		$		4,083
	$		135,753
				Lodging - 0.24%
Internet - 0.48%				Belmond Ltd ^(a)	181,367		2,079
1-800-Flowers.com Inc ^(a)	28,855		232	Boyd Gaming Corp ^(a)	57,334		662
Bankrate Inc ^(a)	13,249		144	Caesars Entertainment Corp ^(a)	7,570		92
Blucora Inc ^(a)	57,978		982	Full House Resorts Inc ^(a)	9,522		12
Boingo Wireless Inc ^(a)	7,417		52	La Quinta Holdings Inc ^(a)	3,912		80
BroadVision Inc ^(a)	2,600		21	Marcus Corp/The	34,767		596
Cinedigm Corp ^(a)	17,268		27	Monarch Casino & Resort Inc ^(a)	2,257		36
Covisint Corp ^(a)	5,260		15	Red Lion Hotels Corp ^(a)	31,701		180
Dice Holdings Inc ^(a)	7,688		77
ePlus Inc ^(a)	11,373		694		$		3,737
FTD Cos Inc ^(a)	28,753		1,012	Machinery - Construction & Mining - 0.07%
Global Sources Ltd ^(a)	4,862		36	Astec Industries Inc	17,246		654
Internap Network Services Corp ^(a)	16,126		129	Hyster-Yale Materials Handling Inc	6,115		480
Intralinks Holdings Inc ^(a)	73,399		634		$		1,134
iPass Inc ^(a)	1,471		2
Lands' End Inc ^(a)	3,247		154	Machinery - Diversified - 0.30%
Liberty Ventures ^(a)	8,043		282	Alamo Group Inc	20,079		860
Limelight Networks Inc ^(a)	19,233		47	Albany International Corp	5,002		189
Liquidity Services Inc ^(a)	7,773		99	Applied Industrial Technologies Inc	5,202		254
magicJack VocalTec Ltd ^(a)	1,871		17	Briggs & Stratton Corp	73,804		1,491
ModusLink Global Solutions Inc ^(a)	56,699		198	Columbus McKinnon Corp/NY	5,676		161
				Gencor Industries Inc ^(a)	3,553		34
New Media Investment Group Inc	6,237		119	Gerber Scientific Inc ^(a),(b),(c)	56,637		—
Orbitz Worldwide Inc ^(a)	27,750		229
				Global Power Equipment Group Inc	2,642		36

PC-Tel Inc	47		—	Hurco Cos Inc	14,440		557
Perficient Inc ^(a)	14,710		244	Intevac Inc ^(a)	5,473		41
QuinStreet Inc ^(a)	4,116		17
RealNetworks Inc ^(a)	33,482		231	Kadant Inc	15,537		643
				Key Technology Inc ^(a)	1,200		16
Reis Inc	14,482		339	Lindsay Corp	586		51
RetailMeNot Inc ^(a)	240		5
				Tecumseh Products Co ^(a)	22,494		83
Rightside Group Ltd ^(a)	2,008		19
Safeguard Scientifics Inc ^(a)	19,448		388	Tennant Co	2,587		191
Shutterfly Inc ^(a)	2,966		124	Twin Disc Inc	3,069		79
				Xerium Technologies Inc ^(a)	2,530		38
Support.com Inc ^(a)	7,801		17
TechTarget Inc ^(a)	3,637		35		$		4,724
TeleCommunication Systems Inc ^(a)	83,807		242	Media - 0.69%
TheStreet Inc	29,207		67	AH Belo Corp	31,351		361
Trulia Inc ^(a)	770		36	Beasley Broadcasting Group Inc	5,597		26
United Online Inc	22,342		251	Courier Corp	9,552		130
Zynga Inc ^(a)	132,527		338	Crown Media Holdings Inc ^(a)	7,911		28
	$		7,555	Cumulus Media Inc ^(a)	219,996		850
				Demand Media Inc ^(a)	2,008		14
Investment Companies - 0.43%				Dex Media Inc ^(a)	4,442		35
Acacia Research Corp	8,515		153	Entercom Communications Corp ^(a)	28,805		295
Caesars Acquisition Co ^(a)	13,664		143
				Entravision Communications Corp	100		1
Capital Southwest Corp	11,839		434	EW Scripps Co/The ^(a)	83,110		1,595
Medallion Financial Corp	6,774		78	Gray Television Inc ^(a)	109,493		1,012


Schedule of Investments
SmallCap Value Fund II
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Media (continued)				Miscellaneous Manufacturing (continued)
Here Media Inc ^(a),(b),(c)	3,700	$	—	Servotronics Inc ^(a)	788	$	5
Here Media Inc - Special Shares ^(a),(c)	3,700		—	Standex International Corp	73,823		6,367
Houghton Mifflin Harcourt Co ^(a)	18,542		371	Synalloy Corp	2,162		35
Journal Communications Inc ^(a)	91,189		895	Tredegar Corp	8,805		168
Lee Enterprises Inc ^(a)	15,646		58	TriMas Corp ^(a)	1,535		49
LIN Media LLC ^(a)	4,190		100	Trinity Industries Inc	9,670		345
McClatchy Co/The ^(a)	89,244		318	Trinseo SA ^(a)	2,637		38
Media General Inc ^(a)	23,639		353		$		26,699
Meredith Corp	20,795		1,084
New York Times Co/The	50,214		645	Office & Business Equipment - 0.01%
				Eastman Kodak Co ^(a)	5,153		111
Radio One Inc ^(a)	27,800		69
Saga Communications Inc	5,536		222
Salem Communications Corp	17,567		135	Office Furnishings - 0.06%
Scholastic Corp	44,643		1,554	HNI Corp	765		36
Spanish Broadcasting System Inc ^(a)	1,921		8	Kewaunee Scientific Corp	3,601		63
Time Inc	25,038		566	Knoll Inc	18,260		363
	$		10,725	Steelcase Inc	21,580		382
				Virco Manufacturing Corp ^(a)	4,847		13
Metal Fabrication & Hardware - 0.99%
AM Castle & Co ^(a)	35,449		261		$		857
Ampco-Pittsburgh Corp	10,756		234	Oil & Gas - 1.80%
Chicago Rivet & Machine Co	1,070		33	Adams Resources & Energy Inc	1,651		69
CIRCOR International Inc	4,642		349	Alon USA Energy Inc	76,501		1,227
Dynamic Materials Corp	4,456		82	Apco Oil and Gas International Inc ^(a)	2,354		34
Eastern Co/The	2,538		41	Approach Resources Inc ^(a)	8,719		87
Haynes International Inc	2,138		99	Atwood Oceanics Inc	7,133		290
Lawson Products Inc/DE ^(a)	9,612		231	Barnwell Industries Inc ^(a)	2,755		7
LB Foster Co	9,234		500	Bill Barrett Corp ^(a)	8,453		128
Mueller Industries Inc	3,856		125	Callon Petroleum Co ^(a)	72,675		476
Mueller Water Products Inc - Class A	162,959		1,608	Clayton Williams Energy Inc ^(a)	365		30
NN Inc	5,507		137	Comstock Resources Inc	104,884		1,242
Northwest Pipe Co ^(a)	15,729		563	Contango Oil & Gas Co ^(a)	25,432		930
Olympic Steel Inc	13,908		280	Delek US Holdings Inc	79,031		2,678
Rexnord Corp ^(a)	320,750		9,478	Emerald Oil Inc ^(a)	18,694		59
RTI International Metals Inc ^(a)	64,483		1,519	Energy XXI Bermuda Ltd	122,878		945
	$		15,540	Escalera Resources Co ^(a)	684		1
				Forest Oil Corp ^(a)	49,741		40
Mining - 1.02%				Gastar Exploration Inc ^(a)	3,023		12
Allied Nevada Gold Corp ^(a)	44,740		62
				Halcon Resources Corp ^(a)	88,859		277
A-Mark Precious Metals Inc ^(a)	2,012		21
				Harvest Natural Resources Inc ^(a)	59,132		220
Century Aluminum Co ^(a)	156,335		4,578
				Hercules Offshore Inc ^(a)	319,680		527
Charles & Colvard Ltd ^(a)	8,589		25
				Magnum Hunter Resources Corp ^(a)	5,543		26
Coeur Mining Inc ^(a)	125,221		463
				Magnum Hunter Resources Corp - Warrants	11,862		—
Globe Specialty Metals Inc	222,035		4,176	(a),(b),(c)
Hecla Mining Co	112,350		245	Matador Resources Co ^(a)	30,148		732
Horsehead Holding Corp ^(a)	75,371		1,184
				Midstates Petroleum Co Inc ^(a)	12,973		38
Kaiser Aluminum Corp	36,634		2,548	North Atlantic Drilling Ltd	16,043		99
Materion Corp	15,226		601	Northern Oil and Gas Inc ^(a)	75,937		859
Noranda Aluminum Holding Corp	57,970		256	Oasis Petroleum Inc ^(a)	124,300		3,724
Stillwater Mining Co ^(a)	133,467		1,752
				Pacific Drilling SA ^(a)	49,242		358
	$		15,911	Parker Drilling Co ^(a)	310,284		1,378
Miscellaneous Manufacturing - 1.71%				PBF Energy Inc	11,857		309
Actuant Corp	40,230		1,276	PDC Energy Inc ^(a)	14,329		627
American Railcar Industries Inc	7,006		461	Penn Virginia Corp ^(a)	149,792		1,284
AO Smith Corp	3,260		174	PetroQuest Energy Inc ^(a)	3,802		18
Barnes Group Inc	85,821		3,138	Rex Energy Corp ^(a)	1,200		9
Blount International Inc ^(a)	30,400		465	Rosetta Resources Inc ^(a)	20,112		765
Chase Corp	301		11	RSP Permian Inc ^(a)	4,799		117
CLARCOR Inc	858		57	Sanchez Energy Corp ^(a)	3,092		53
Core Molding Technologies Inc ^(a)	9,787		130	SandRidge Energy Inc ^(a)	38,387		150
Fabrinet ^(a)	8,097		147	Stone Energy Corp ^(a)	116,238		2,848
Federal Signal Corp	92,884		1,319	Swift Energy Co ^(a)	57,822		396
FreightCar America Inc	1,548		51	Triangle Petroleum Corp ^(a)	64,445		499
GP Strategies Corp ^(a)	1,357		45	Unit Corp ^(a)	66,929		3,241
Handy & Harman Ltd ^(a)	1,249		44	Vaalco Energy Inc ^(a)	83,495		620
Hillenbrand Inc	325,600		10,839	Vantage Drilling Co ^(a)	62,697		61
LSB Industries Inc ^(a)	9,612		361	W&T Offshore Inc	28,162		256
Lydall Inc ^(a)	21,809		674	Warren Resources Inc ^(a)	95,992		332
MFRI Inc ^(a)	8,842		81		$		28,078
Myers Industries Inc	20,726		310

NL Industries Inc	7,880		57	Oil & Gas Services - 3.30%
Park-Ohio Holdings Corp	750		40	Basic Energy Services Inc ^(a)	54,832		707
PMFG Inc ^(a)	2,306		12	Bristow Group Inc	82,972		6,133
				C&J Energy Services Inc ^(a)	15,839		305


Schedule of Investments
SmallCap Value Fund II
October 31, 2014



COMMON STOCKS (continued)	Shares Held	Value (000's)		COMMON STOCKS (continued)	Shares Held	Value(000				's)

Oil & Gas Services (continued)				REITS (continued)
Dawson Geophysical Co	15,730	$	267	Apollo Residential Mortgage Inc	31,057			$	518
Exterran Holdings Inc	153,458		6,036	Armada Hoffler Properties Inc	8,040				75
Forbes Energy Services Ltd ^(a)	2,442		7	ARMOUR Residential REIT Inc	64,334				255
Forum Energy Technologies Inc ^(a)	406,365		11,093	Ashford Hospitality Prime Inc	21,880				379
Gulf Island Fabrication Inc	13,792		292	Ashford Hospitality Trust Inc	10,879				123
Gulfmark Offshore Inc	61,874		1,866	Associated Estates Realty Corp	16,206				316
Helix Energy Solutions Group Inc ^(a)	258,665		6,891	Aviv REIT Inc	4,104				138
ION Geophysical Corp ^(a)	133,391		374	Capstead Mortgage Corp	110,808				1,408
Key Energy Services Inc ^(a)	216,182		657	Chambers Street Properties	40,472				332
McDermott International Inc ^(a)	252,290		969	Chatham Lodging Trust	5,619				144
Mitcham Industries Inc ^(a)	16,760		171	Chesapeake Lodging Trust	12,114				400
MRC Global Inc ^(a)	8,712		183	Colony Financial Inc	20,446				456
Natural Gas Services Group Inc ^(a)	24,135		621	CorEnergy Infrastructure Trust Inc	9,617				72
Newpark Resources Inc ^(a)	127,502		1,457	Cousins Properties Inc	47,499				618
PHI Inc ^(a)	16,306		729	CubeSmart	24,851				523
Pioneer Energy Services Corp ^(a)	111,809		1,027	CyrusOne Inc	20,315				555
SEACOR Holdings Inc ^(a)	42,845		3,532	CYS Investments Inc	125,715				1,122
Steel Excel Inc ^(a)	16,164		493	DCT Industrial Trust Inc	98,869				848
Tesco Corp	50,369		959	DiamondRock Hospitality Co	72,048				1,034
Tetra Technologies Inc ^(a)	93,186		888	DuPont Fabros Technology Inc	20,664				640
Thermon Group Holdings Inc ^(a)	230,675		5,622	Dynex Capital Inc	53,001				446
Willbros Group Inc ^(a)	55,427		325	EastGroup Properties Inc	2,603				179
	$		51,604	Education Realty Trust Inc	36,908				415
				EPR Properties	26,821				1,505
Packaging & Containers - 1.73%				Equity One Inc	14,423				346
Berry Plastics Group Inc ^(a)	33,468		871
Graphic Packaging Holding Co ^(a)	1,201,917		14,579	Excel Trust Inc	10,286				134
				FelCor Lodging Trust Inc	117,449				1,260
Greif Inc - Class A	4,836		213	First Industrial Realty Trust Inc	18,845				368
Greif Inc - Class B	557		28	First Potomac Realty Trust	16,655				208
Silgan Holdings Inc	230,226		11,318	Franklin Street Properties Corp	20,080				241
UFP Technologies Inc ^(a)	1,669		37
				Geo Group Inc/The	28,145				1,124
	$		27,046	Getty Realty Corp	28,736				534
Pharmaceuticals - 1.48%				Government Properties Income Trust	63,089				1,440
Anacor Pharmaceuticals Inc ^(a)	4,006		118	Gramercy Property Trust Inc	25,384				159
Anika Therapeutics Inc ^(a)	7,464		300	Hatteras Financial Corp	16,426				313
BioScrip Inc ^(a)	54,103		349	Healthcare Realty Trust Inc	22,117				586
Catalent Inc ^(a)	1,461		38	Hersha Hospitality Trust	1,417,455		10,334
Impax Laboratories Inc ^(a)	23,069		668	Highwoods Properties Inc	41,986				1,800
Lannett Co Inc ^(a)	176,247		9,997	Hudson Pacific Properties Inc	8,939				244
Natural Alternatives International Inc ^(a)	3,359		21	Inland Real Estate Corp	52,274				554
Nektar Therapeutics ^(a)	9,395		130	Invesco Mortgage Capital Inc	30,557				506
Nutraceutical International Corp ^(a)	7,372		166	Investors Real Estate Trust	21,624				182
Omega Protein Corp ^(a)	63,319		915	iStar Financial Inc ^(a)	14,583				207
Owens & Minor Inc	12,009		400	Kite Realty Group Trust	7,261				188
PharMerica Corp ^(a)	87,927		2,522	LaSalle Hotel Properties	17,772				697
Prestige Brands Holdings Inc ^(a)	53,108		1,881	Lexington Realty Trust	34,977				383
Sagent Pharmaceuticals Inc ^(a)	1,274		40	LTC Properties Inc	17,516				734
SciClone Pharmaceuticals Inc ^(a)	4,450		34	Mack-Cali Realty Corp	15,089				283
Sucampo Pharmaceuticals Inc ^(a)	8,302		72	Medical Properties Trust Inc	37,229				502
Targacept Inc ^(a)	2,212		5	Monmouth Real Estate Investment Corp	9,548				107
VCA Inc ^(a)	5,115		233	New Residential Investment Corp	84,913				1,052
VWR Corp ^(a)	232,925		5,199	New York Mortgage Trust Inc	18,952				148
	$		23,088	New York REIT Inc	29,979				336
				One Liberty Properties Inc	3,656				84
Real Estate - 0.23%				Parkway Properties Inc/Md	12,175				244
Alexander & Baldwin Inc	38,750		1,552	Pebblebrook Hotel Trust	14,953				637
Altisource Residential Corp	58,600		1,360	Pennsylvania Real Estate Investment Trust	15,360				329
BBX Capital Corp ^(a)	8,983		165	PennyMac Mortgage Investment Trust	49,756				1,075
California Coastal Communities Inc ^(a),(b),(c)	9,672		—	Physicians Realty Trust	8,094				124
Forestar Group Inc ^(a)	10,900		190	Potlatch Corp	16,270				716
Kennedy-Wilson Holdings Inc	10,692		290	PS Business Parks Inc	2,056				173
Stratus Properties Inc ^(a)	2,638		36	RAIT Financial Trust	14,478				106
	$		3,593	Ramco-Gershenson Properties Trust	16,668				291
REITS - 3.44%				Redwood Trust Inc	14,352				270
Acadia Realty Trust	12,388		387	Resource Capital Corp	53,386				282
AG Mortgage Investment Trust Inc	44,456		847	Retail Opportunity Investments Corp	19,486				318
Agree Realty Corp	4,736		145	Rexford Industrial Realty Inc	7,852				121
American Assets Trust Inc	5,081		195	RLJ Lodging Trust	42,834				1,380
American Capital Mortgage Investment Corp	29,831		585	Rouse Properties Inc	6,316				115
American Realty Capital Healthcare Trust Inc	28,815		326	Ryman Hospitality Properties Inc	4,508				223
American Residential Properties Inc ^(a)	5,472		104	Sabra Health Care REIT Inc	10,660				305
Anworth Mortgage Asset Corp	25,515		132	Select Income REIT	36,233				888
Apollo Commercial Real Estate Finance Inc	66,052		1,086	Silver Bay Realty Trust Corp	6,541				111


Schedule of Investments
SmallCap Value Fund II
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

REITS (continued)				Retail (continued)
Sovran Self Storage Inc	1,274	$	108	Roundy's Inc	13,520	$	45
STAG Industrial Inc	10,770		263	Ruby Tuesday Inc ^(a)	133,361		1,024
Starwood Waypoint Residential Trust	6,656		174	Rush Enterprises Inc - Class A ^(a)	52,768		2,010
Strategic Hotels & Resorts Inc ^(a)	59,794		768	Rush Enterprises Inc - Class B ^(a)	11,863		384
Summit Hotel Properties Inc	17,203		200	Ruth's Hospitality Group Inc	22,355		272
Sunstone Hotel Investors Inc	63,736		976	Shoe Carnival Inc	24,039		442
Terreno Realty Corp	5,681		120	Sonic Automotive Inc	11,721		291
UMH Properties Inc	5,041		51	Sonic Corp	44,670		1,127
Universal Health Realty Income Trust	6,194		300	Stage Stores Inc	26,855		453
Urstadt Biddle Properties Inc	2,714		59	Stein Mart Inc	18,948		254
Washington Real Estate Investment Trust	52,473		1,483	Systemax Inc ^(a)	11,879		182
Western Asset Mortgage Capital Corp	7,057		106	Trans World Entertainment Corp	14,559		48
Whitestone REIT	6,660		100	Tuesday Morning Corp ^(a)	46,848		955
	$		53,778	Vitamin Shoppe Inc ^(a)	17,612		826
				Wendy's Co/The	376,438		3,019
Retail - 6.73%				West Marine Inc ^(a)	33,578		330
Abercrombie & Fitch Co	59,658		1,997	World Fuel Services Corp	2,707		112
American Eagle Outfitters Inc	38,122		491	Zumiez Inc ^(a)	1,256		42
America's Car-Mart Inc/TX ^(a)	1,997		92
Ascena Retail Group Inc ^(a)	6,814		85		$		105,160
Barnes & Noble Inc ^(a)	70,408		1,536	Savings & Loans - 1.68%
Big 5 Sporting Goods Corp	1,355		17	Ameriana Bancorp	2,687		46
Biglari Holdings Inc ^(a)	2,586		903	Astoria Financial Corp	249,400		3,279
BJ's Restaurants Inc ^(a)	4,109		180	Atlantic Coast Financial Corp ^(a)	210		1
Bloomin' Brands Inc ^(a)	266,000		5,030	Banc of California Inc	14,746		173
Bob Evans Farms Inc	3,880		190	Bank Mutual Corp	49,295		325
Books-A-Million Inc ^(a)	13,331		19	BankFinancial Corp	23,353		279
Brown Shoe Co Inc	13,128		349	Bear State Financial Inc ^(a)	356		3
Build-A-Bear Workshop Inc ^(a)	27,481		466	Beneficial Mutual Bancorp Inc ^(a)	31,127		418
Burlington Stores Inc ^(a)	898		38	Berkshire Hills Bancorp Inc	31,018		800
Cache Inc ^(a)	23,972		14	Brookline Bancorp Inc	92,802		890
Cash America International Inc	22,466		1,105	Cape Bancorp Inc	5,980		53
Cato Corp/The	10,989		392	Capitol Federal Financial Inc	234,853		3,008
Children's Place Inc/The	19,633		967	Chicopee Bancorp Inc	1,061		16
Christopher & Banks Corp ^(a)	15,500		101	Citizens Community Bancorp Inc/WI	2,250		20
Citi Trends Inc ^(a)	22,006		498	Dime Community Bancshares Inc	22,207		350
Coast Distribution System Inc/The ^(a)	2,597		8	Eagle Bancorp Montana Inc	111		1
Conn's Inc ^(a)	308		10	ESB Financial Corp	4,830		91
Cracker Barrel Old Country Store Inc	4,521		522	ESSA Bancorp Inc	9,408		108
Denny's Corp ^(a)	94,918		818	EverBank Financial Corp	28,786		551
Destination Maternity Corp	7,508		113	First Defiance Financial Corp	13,054		400
Destination XL Group Inc ^(a)	468		2	First Financial Northwest Inc	17,586		204
DineEquity Inc	15,443		1,374	First Niagara Financial Group Inc	16,610		124
Express Inc ^(a)	15,613		234	Flagstar Bancorp Inc ^(a)	16,589		261
Ezcorp Inc ^(a)	34,901		393	Flushing Financial Corp	51,223		1,031
Finish Line Inc/The	18,383		486	Fox Chase Bancorp Inc	15,669		257
First Cash Financial Services Inc ^(a)	177,926		10,512	Hampden Bancorp Inc	695		12
Fred's Inc	77,865		1,222	Heritage Financial Group Inc	2,794		59
Frisch's Restaurants Inc	4,600		118	HF Financial Corp	8,101		110
Gaiam Inc ^(a)	15,945		121	HMN Financial Inc ^(a)	2,080		27
Genesco Inc ^(a)	4,307		330	Home Bancorp Inc ^(a)	3,409		78
GNC Holdings Inc	274,350		11,405	HomeStreet Inc	700		12
Group 1 Automotive Inc	115,835		9,895	HomeTrust Bancshares Inc ^(a)	7,024		109
Guess? Inc	15,839		352	HopFed Bancorp Inc	3,929		45
Haverty Furniture Cos Inc	25,947		571	Investors Bancorp Inc	60,824		654
hhgregg Inc ^(a)	10,615		55	LSB Financial Corp/IN	514		22
HSN Inc	153,400		10,135	Magyar Bancorp Inc ^(a)	400		3
Jack in the Box Inc	119,175		8,466	Meta Financial Group Inc	3,224		121
Kirkland's Inc ^(a)	4,575		81	MutualFirst Financial Inc	4,937		107
Lithia Motors Inc	3,800		295	Naugatuck Valley Financial Corp ^(a)	279		2
Luby's Inc ^(a)	28,408		142	New Hampshire Thrift Bancshares Inc	1,896		30
MarineMax Inc ^(a)	38,611		740	Northeast Community Bancorp Inc	2,697		19
Men's Wearhouse Inc	212,952		10,016	Northfield Bancorp Inc	39,682		565
Movado Group Inc	30,853		1,090	Northwest Bancshares Inc	161,220		2,069
New York & Co Inc ^(a)	8,783		29	Ocean Shore Holding Co	2,736		39
Office Depot Inc ^(a)	234,479		1,224	OceanFirst Financial Corp	4,294		71
Pacific Sunwear of California Inc ^(a)	78,043		119	Oneida Financial Corp	800		11
Pantry Inc/The ^(a)	35,495		914	Oritani Financial Corp	12,360		182
PC Connection Inc	38,693		922	Pacific Premier Bancorp Inc ^(a)	7,200		117
PCM Inc ^(a)	21,523		208	Provident Financial Holdings Inc	10,567		154
Penske Automotive Group Inc	68,729		3,109	Provident Financial Services Inc	165,557		3,018
Pep Boys-Manny Moe & Jack/The ^(a)	99,549		949	Prudential Bancorp Inc	6,246		76
Perfumania Holdings Inc ^(a)	3,407		21	Pulaski Financial Corp	4,791		57
Regis Corp	110,302		1,873	Riverview Bancorp Inc ^(a)	28,105		114


Schedule of Investments
SmallCap Value Fund II
October 31, 2014



COMMON STOCKS (continued)	Shares Held Value (000's)			COMMON STOCKS (continued)	Shares Held Value (000's)

Savings & Loans (continued)				Software (continued)
SI Financial Group Inc	1,687	$	19	Broadridge Financial Solutions Inc	331,200	$	14,550
Simplicity Bancorp Inc	2,832		47	BroadSoft Inc ^(a)	130,850		2,996
Sterling Bancorp/DE	50,590		711	BSQUARE Corp ^(a)	81		—
Territorial Bancorp Inc	9,547		205	CommVault Systems Inc ^(a)	153,900		6,824
TierOne Corp ^(a),(b),(c)	2,447		—	Compuware Corp	37,524		381
Timberland Bancorp Inc/WA	7,281		77	Concurrent Computer Corp	2,188		16
United Community Financial Corp/OH	25,332		130	CSG Systems International Inc	3,796		101
United Financial Bancorp Inc	26,145		367	Dealertrack Technologies Inc ^(a)	2,598		122
Washington Federal Inc	168,114		3,670	Digi International Inc ^(a)	39,712		329
Waterstone Financial Inc	10,357		127	Digital River Inc ^(a)	43,096		1,102
Wayne Savings Bancshares Inc	1,380		18	Dun & Bradstreet Corp/The	93,225		11,449
Westfield Financial Inc	23,009		163	Ebix Inc	8,961		132
WSFS Financial Corp	1,897		149	Epiq Systems Inc	41,338		663
	$		26,255	GSE Systems Inc ^(a)	3,462		5
				ManTech International Corp/VA	39,925		1,124
Semiconductors - 2.91%				MedAssets Inc ^(a)	227,733		4,933
Alpha & Omega Semiconductor Ltd ^(a)	23,298		216
				Paycom Software Inc ^(a)	1,907		34
Amkor Technology Inc ^(a)	106,766		724
				Progress Software Corp ^(a)	9,708		251
ANADIGICS Inc ^(a)	2,787		2
				PTC Inc ^(a)	6,780		259
Axcelis Technologies Inc ^(a)	83,853		183
				Sapiens International Corp NV ^(a)	4,109		33
AXT Inc ^(a)	9,695		23
				Seachange International Inc ^(a)	30,497		206
Brooks Automation Inc	94,713		1,168	SS&C Technologies Holdings Inc ^(a)	250,850		12,121
Cabot Microelectronics Corp ^(a)	5,670		273
Cascade Microtech Inc ^(a)	20,908		225	SYNNEX Corp	92,854		6,424
				Take-Two Interactive Software Inc ^(a)	22,172		587
CEVA Inc ^(a)	6,890		112
				Verint Systems Inc ^(a)	278,644		16,019
Cirrus Logic Inc ^(a)	46,427		896
Cohu Inc	25,085		256		$		82,153
Diodes Inc ^(a)	20,990		542	Storage & Warehousing - 0.21%
DSP Group Inc ^(a)	39,162		380	Mobile Mini Inc	69,952		3,066
Emcore Corp ^(a)	1,615		8	Wesco Aircraft Holdings Inc ^(a)	9,193		163
Emulex Corp ^(a)	171,588		972		$		3,229
Entegris Inc ^(a)	11,936		162
Entropic Communications Inc ^(a)	33,314		83	Supranational Bank - 0.01%
Exar Corp ^(a)	10,241		98	Banco Latinoamericano de Comercio Exterior	5,930		199
Fairchild Semiconductor International Inc ^(a)	199,282		3,059	SA
FormFactor Inc ^(a)	115,982		924
GigOptix Inc ^(a)	4,322		5	Telecommunications - 1.77%
Ikanos Communications Inc ^(a)	9,018		4	ADTRAN Inc	6,399		136
Ikanos Communications Inc - Rights ^(a),(b),(c)	9,018		—	Anixter International Inc	10,022		853
Integrated Device Technology Inc ^(a)	8,297		136	Atlantic Tele-Network Inc	5,679		382
Integrated Silicon Solution Inc	67,602		918	Aviat Networks Inc ^(a)	56,757		100
International Rectifier Corp ^(a)	108,315		4,307	Aware Inc	17,409		75
Intersil Corp	314,220		4,176	Black Box Corp	52,089		1,145
IXYS Corp	31,754		371	Cincinnati Bell Inc ^(a)	241,870		888
Kulicke & Soffa Industries Inc ^(a)	123,493		1,781	Clearfield Inc ^(a)	543		8
Lattice Semiconductor Corp ^(a)	57,363		385	CommScope Holding Co Inc ^(a)	394,875		8,506
Microsemi Corp ^(a)	15,217		397	Communications Systems Inc	8,832		105
MKS Instruments Inc	64,061		2,332	Comtech Telecommunications Corp	26,445		1,006
OmniVision Technologies Inc ^(a)	149,848		4,013	Consolidated Communications Holdings Inc	4,397		114
Pericom Semiconductor Corp ^(a)	33,659		368	DigitalGlobe Inc ^(a)	40,991		1,172
Photronics Inc ^(a)	127,747		1,149	EarthLink Holdings Corp	210,913		754
PMC-Sierra Inc ^(a)	23,240		181	Finisar Corp ^(a)	1,728		29
QLogic Corp ^(a)	90,577		1,069	General Communication Inc ^(a)	31,409		368
Richardson Electronics Ltd/United States	19,771		198	Globalstar Inc ^(a)	46,728		111
Rovi Corp ^(a)	196,080		4,094	Harmonic Inc ^(a)	206,538		1,377
Rudolph Technologies Inc ^(a)	11,717		103	Hawaiian Telcom Holdco Inc ^(a)	6,117		165
Sigma Designs Inc ^(a)	53,970		215	HC2 Holdings Inc ^(a)	1,074		6
Silicon Image Inc ^(a)	39,182		210	ID Systems Inc ^(a)	1,586		12
Silicon Laboratories Inc ^(a)	2,607		119	IDT Corp - Class B	2,883		47
SunEdison Inc ^(a)	28,212		550	Inteliquent Inc	2,374		40
Tessera Technologies Inc	3,790		115	Intelsat SA ^(a)	7,426		144
TriQuint Semiconductor Inc ^(a)	344,389		7,449	Iridium Communications Inc ^(a)	108,466		1,030
Ultra Clean Holdings Inc ^(a)	15,329		135	Ixia ^(a)	17,295		167
Ultratech Inc ^(a)	3,912		75	KVH Industries Inc ^(a)	8,268		107
Veeco Instruments Inc ^(a)	6,810		245	Leap Wireless International Inc - Rights	64,745		163
Xcerra Corp ^(a)	14,655		124	(a),(b),(c)
	$		45,530	Loral Space & Communications Inc ^(a)	5,437		416
				NeoPhotonics Corp ^(a)	3,868		13
Software - 5.26%				Netgear Inc ^(a)	33,215		1,130
Actua Corp ^(a)	7,478		140
				Novatel Wireless Inc ^(a)	9,345		27
Acxiom Corp ^(a)	42,854		807
Audience Inc ^(a)	1,781		7	NTELOS Holdings Corp	2,777		28
				Oclaro Inc ^(a)	15,101		24
Avid Technology Inc ^(a)	48,969		492
Bottomline Technologies de Inc ^(a)	1,854		46	Oplink Communications Inc	36,787		767
				Optical Cable Corp	8,872		41


Schedule of Investments
SmallCap Value Fund II
October 31, 2014



COMMON STOCKS (continued)	Shares Held	Value (000's)		COMMON STOCKS (continued)		Shares Held	Value(000				's)

Telecommunications (continued)				Trucking & Leasing (continued)
Orbcomm Inc ^(a)	70,586	$	447	TAL International Group Inc		10,975			$	473
Plantronics Inc	1,072		56	Textainer Group Holdings Ltd		2,456				84
Polycom Inc ^(a)	311,482		4,074	Willis Lease Finance Corp ^(a)		8,412				192
Preformed Line Products Co	1,084		62					$		13,440
Premiere Global Services Inc ^(a)	8,568		90
RELM Wireless Corp ^(a)	1,332		7	Water - 0.07%
RF Industries Ltd	300		1	American States Water Co		9,677				346
Shenandoah Telecommunications Co	2,947		87	California Water Service Group		15,161				395
Spok Holdings Inc	25,224		410	Connecticut Water Service Inc		2,720				101
Straight Path Communications Inc ^(a)	1,189		26	Consolidated Water Co Ltd		14,307				171
Telephone & Data Systems Inc	21,812		559	Middlesex Water Co		1,357				31
Tessco Technologies Inc	3,376		108	SJW Corp		959				31
Vonage Holdings Corp ^(a)	30,541		106					$		1,075
West Corp	3,592		115	TOTAL COMMON STOCKS				$		1,501,215
Westell Technologies Inc ^(a)	34,514		46	INVESTMENT COMPANIES - 4.10%		Shares Held	Value	(000			's)
	$		27,650	Publicly Traded Investment Fund - 4.10%
Textiles - 0.17%				BlackRock Liquidity Funds TempFund		30,482,210				30,482
Culp Inc	3,581		68	Portfolio
Dixie Group Inc/The ^(a)	11,461		90	Goldman Sachs Financial Square Funds -		32,897,865				32,898
G&K Services Inc	22,119		1,395	Money Market Fund
UniFirst Corp/MA	9,699		1,082	JP Morgan Prime Money Market Fund		700,211				700
	$		2,635					$		64,080
				TOTAL INVESTMENT COMPANIES				$		64,080
Toys, Games & Hobbies - 0.01%				Total Investments				$		1,565,295
Jakks Pacific Inc ^(a)	25,395		162
LeapFrog Enterprises Inc ^(a)	8,019		43	Liabilities in Excess of Other Assets, Net - (0.16)%				$		(2,499	)
				TOTAL NET ASSETS - 100.00%				$		1,562,796
	$		205
				(a)	Non-Income Producing Security
Transportation - 1.53%				(b)	Security is Illiquid
Air Transport Services Group Inc ^(a)	94,542		773	(c)	Fair value of these investments is determined in good faith by the Manager
ArcBest Corp	73,092		2,829		under procedures established and periodically reviewed by the Board of
Atlas Air Worldwide Holdings Inc ^(a)	49,124		1,814
					Directors. At the end of the period, the fair value of these securities totaled
Baltic Trading Ltd	26,411		99		$295 or 0.02% of net assets.
CAI International Inc ^(a)	6,463		136
Celadon Group Inc	129,833		2,526
Con-way Inc	61,931		2,686		Portfolio Summary (unaudited)
Covenant Transportation Group Inc ^(a)	11,049		229		Sector					Percent
DHT Holdings Inc	10,525		70	Financial						26.53	%
Era Group Inc ^(a)	37,117		869	Consumer, Non-cyclical						16.27	%
GasLog Ltd	6,136		128	Industrial						14.22	%
Hornbeck Offshore Services Inc ^(a)	71,743		2,199	Consumer, Cyclical						13.60	%
International Shipholding Corp	8,671		174	Technology						11.02	%
Knightsbridge Shipping Ltd	10,051		88	Energy						5.49	%
Marten Transport Ltd	61,332		1,203	Basic Materials						4.35	%
Matson Inc	59,030		1,682	Exchange Traded Funds						4.10	%
Navios Maritime Acquisition Corp	24,428		77	Communications						3.01	%
Navios Maritime Holdings Inc	13,504		80	Utilities						1.50	%
Nordic American Tankers Ltd	13,295		112	Diversified						0.06	%
Overseas Shipholding Group Inc - Warrants	34,268		120	Government						0.01	%
(a),(c)				Liabilities in Excess of Other Assets, Net						(0.16	)%
PAM Transportation Services Inc ^(a)	10,768		463		TOTAL NET ASSETS					100.00	%
Patriot Transportation Holding Inc ^(a)	960		41
Providence and Worcester Railroad Co	4,798		85
Quality Distribution Inc ^(a)	34,542		448
Roadrunner Transportation Systems Inc ^(a)	14,102		290
Safe Bulkers Inc	11,359		61
Saia Inc ^(a)	19,069		935
Scorpio Bulkers Inc ^(a)	22,919		112
Scorpio Tankers Inc	37,427		327
Ship Finance International Ltd	26,342		453
Teekay Tankers Ltd	19,292		82
Tidewater Inc	17,774		655
Ultrapetrol Bahamas Ltd ^(a)	14,867		45
USA Truck Inc ^(a)	8,609		146
UTI Worldwide Inc ^(a)	15,563		170
Werner Enterprises Inc	45,151		1,243
XPO Logistics Inc ^(a)	7,577		303
YRC Worldwide Inc ^(a)	4,864		104
	$		23,857

Trucking & Leasing - 0.86%
AMERCO	12,249		3,321
GATX Corp	91,429		5,797
Greenbrier Cos Inc/The	57,130		3,573


Schedule of Investments
Tax-Exempt Bond Fund
October 31, 2014



				Principal					Principal
	BONDS- 1.00	%		Amount (000's)	Value (000's )		MUNICIPAL BONDS (continued)		Amount (000's)	Value (000's )

	U.S. Municipals - 1.00%						California (continued)
	Oglala Sioux Tribe						Metropolitan Water District of Southern
	5.00%, 10/01/2022 ^(a)		$	650	$	652	California
	5.75%, 10/01/2025 ^(a)			1,500		1,538	5.00%, 07/01/2029	$	1,150	$	1,329
				$		2,190	Morongo Band of Mission Indians/The
	TOTAL BONDS			$		2,190	6.50%, 03/01/2028 ^(a)		500		556
				Principal			Port of Los Angeles
	MUNICIPAL BONDS - 100.29%			Amount (000's)	Value (000's)		5.00%, 08/01/2031		1,240		1,407
							Regents of the University of California
	Alabama - 2.22%						Medical Center Pooled Revenue
	Auburn University						5.50%, 05/15/2027		1,375		1,543
	5.00%, 06/01/2038		$	1,500	$	1,661	Richmond Joint Powers Financing Authority
	Birmingham Airport Authority (credit support						6.25%, 07/01/2024		1,000		1,199
	from AGM)						Ripon Unified School District (credit support
	5.25%, 07/01/2030 ^(b)			1,000		1,117	from BAM)
	Courtland Industrial Development Board						0.00%, 08/01/2036 ^(b),(d)		735		236
	5.20%, 06/01/2025			1,250		1,262	Riverside Community Properties Development
	Selma Industrial Development Board						Inc
	6.25%, 11/01/2033			700		812	6.00%, 10/15/2038		1,150		1,372
				$		4,852	Sacramento Area Flood Control
							Agency (credit support from BAM)
	Alaska - 0.81%						5.00%, 10/01/2039 ^(b)		1,340		1,517
	Borough of Matanuska-Susitna AK (credit

	support from ASSURED GTY)						San Diego Unified School District/CA
	5.50%, 09/01/2023 ^(b)			1,500		1,768	0.00%, 07/01/2032 (d)		5,000		2,514
							Southern California Public Power Authority
							5.25%, 07/01/2028		1,000		1,196
	Arizona - 2.00%						University of California
	Arizona Department of Transportation State						5.00%, 05/15/2037		1,500		1,685
	Highway Fund Revenue						5.75%, 05/15/2025		1,380		1,662
	5.00%, 07/01/2026			1,500		1,701	West Contra Costa Unified School District
	City of Phoenix Civic Improvement Corp						5.25%, 08/01/2033		1,000		1,167
	5.00%, 07/01/2034			1,000		1,126			$		44,995
	Industrial Development Authority of the
	County of Pima/The						Colorado - 1.10%
	6.25%, 06/01/2026			160		161	Platte River Power Authority
	6.55%, 12/01/2037			300		306	5.00%, 06/01/2026		1,135		1,314
	Navajo County Pollution Control Corp						Regional Transportation District
	5.75%, 06/01/2034			1,000		1,077	6.00%, 01/15/2041		450		504
				$		4,371	6.50%, 01/15/2030		500		581
									$		2,399
	California - 20.68%
	Alum Rock Union Elementary School						Connecticut - 0.56%
	District						State of Connecticut (credit support from
	5.25%, 08/01/2043			1,000		1,147	ACA)
							6.60%, 07/01/2024 ^(b)		1,215		1,219
	Bay Area Toll Authority
	5.00%, 04/01/2034			2,500		2,821
	California Educational Facilities Authority						District of Columbia - 3.16%
	5.00%, 01/01/2038 ^(c)			1,621		1,779	District of Columbia
	5.00%, 10/01/2038 ^(c)			2,700		3,020	5.00%, 12/01/2023		1,785		2,086
	5.00%, 01/01/2039 ^(c)			8,148		9,089	5.00%, 12/01/2024		715		831
	California Statewide Communities						6.38%, 10/01/2034		1,000		1,182
	Development Authority						District of Columbia Water & Sewer
	6.25%, 11/15/2019			500		560	Authority (credit support from AGM)
	6.63%, 11/15/2024			500		582	5.50%, 10/01/2017 ^(b)		500		570
	California Statewide Communities						District of Columbia Water & Sewer
	Development Authority (credit support from						Authority (credit support from AGM-CR
	FHA INS)						NATL-RE-FGIC)
	6.63%, 08/01/2029 ^(b)			890		1,079	5.50%, 10/01/2041 ^(b)		2,000		2,220
	California Statewide Communities								$		6,889
	Development Authority (credit support from
	GNMA COLL)						Florida - 3.71%
	4.90%, 07/20/2039 ^(b)			500		529	County of Miami-Dade FL Aviation
	City of Los Angeles Department of Airports						Revenue (credit support from ASSURED
	5.00%, 05/15/2035			1,500		1,701	GTY)
	City of Vernon CA Electric System Revenue						5.25%, 10/01/2033 ^(b)		2,000		2,232
	5.13%, 08/01/2021			1,000		1,120	Escambia County Health Facilities
	Golden State Tobacco Securitization Corp						Authority (credit support from AMBAC)
	5.75%, 06/01/2047			1,500		1,218	5.95%, 07/01/2020 ^(b)		65		69
	Lancaster Redevelopment Agency						Florida HomeLoan Corp (credit support from
	6.50%, 08/01/2029			580		692	AMBAC FHA 542 (C))
	Los Angeles Department of Water & Power						6.50%, 07/01/2036 ^(b)		900		902
	5.25%, 07/01/2038			1,000		1,125	Greater Orlando Aviation Authority
	Los Angeles Unified School District/CA						5.00%, 11/15/2036		1,000		988
	5.00%, 07/01/2029			1,000		1,150


Schedule of Investments
Tax-Exempt Bond Fund
October 31, 2014



				Principal						Principal
	MUNICIPAL BONDS (continued)			Amount (000's)	Value (000's)		MUNICIPAL BONDS (continued)			Amount (000's)	Value (000's)

	Florida (continued)						Indiana (continued)
	Miami-Dade County Educational Facilities						Town of Shoals IN
	Authority (credit support from BHAC-CR)						7.25%, 11/01/2043		$	700	$	780
	5.50%, 04/01/2038 ^(b)		$	1,000	$	1,058				$		4,810
	Miami-Dade County School Board Foundation
	Inc (credit support from ASSURED GTY)						Iowa- 2.55	%
	5.25%, 05/01/2028 ^(b)			2,000		2,237	City of Altoona IA (credit support from CITY
	Orange County Industrial Development						APPROP)
							5.75%, 06/01/2031 ^(b)			1,200		1,296
	Authority/FL
	8.00%, 07/01/2036 ^(a)			600		603	Iowa Finance Authority
				$		8,089	5.00%, 12/01/2019			4,000		4,273
										$		5,569
	Georgia - 0.55%
	City of Atlanta GA Water & Wastewater						Kansas - 0.85%
	Revenue						County of Sedgwick KS/County of Shawnee
	6.00%, 11/01/2027			1,000		1,209	KS (credit support from GNMA/FNMA)
							5.65%, 06/01/2037 ^(b)			655		708
							Kansas Development Finance Authority
	Idaho- 1.40	%					5.50%, 11/15/2029			1,000		1,152
	Idaho Health Facilities Authority									$		1,860
	6.65%, 02/15/2021			2,000		2,621
	Idaho Housing & Finance Association						Kentucky - 2.83%
	5.85%, 07/01/2036			435		445	Kentucky Economic Development Finance
				$		3,066	Authority
							5.38%, 08/15/2024			1,000		1,121
	Illinois - 10.45%						5.63%, 08/15/2027			1,000		1,123
	City of Chicago IL						Kentucky Economic Development Finance
	7.13%, 03/15/2022			400		400	Authority (credit support from ASSURED
	7.46%, 02/15/2026			250		192	GTY)
	City of Chicago IL (credit support from						6.00%, 12/01/2033 ^(b)			1,000		1,085
	ASSURED GTY)						Kentucky State Property & Building
	5.25%, 01/01/2025 ^(b)			2,000		2,167	Commission (credit support from ASSURED
	City of Chicago IL Wastewater Transmission						GTY)
	Revenue (credit support from BHAC)						5.25%, 02/01/2025 ^(b)			1,000		1,155
	5.50%, 01/01/2038 ^(b)			1,000		1,107	Paducah Electric Plant Board (credit support
	Gilberts Special Service Area No 24/IL						from ASSURED GTY)
	5.38%, 03/01/2034			325		277	5.25%, 10/01/2035 ^(b)			1,500		1,687
	Huntley Special Service Area No									$		6,171
	10/IL (credit support from ASSURED GTY)
	5.10%, 03/01/2029 ^(b)			1,000		1,067	Louisiana - 1.98%
	Illinois Finance Authority						Lafayette Public Trust Financing
	5.00%, 12/01/2015			750		782	Authority (credit support from AGM)
							5.25%, 10/01/2030 ^(b)			1,000		1,114
	5.38%, 08/15/2024			500		574
	5.50%, 08/01/2037			1,000		1,090	Louisiana Public Facilities Authority
	5.75%, 08/15/2030			1,050		1,221	8.38%, 07/01/2039			600		621
	5.75%, 11/15/2037			1,500		1,624	Louisiana Public Facilities Authority (credit
	6.00%, 03/01/2038			1,540		1,743	support from FNMA)
							0.00%, 12/01/2019 ^(b),(d)			1,500		1,402
	6.25%, 11/15/2035			1,000		1,167
	6.50%, 11/01/2038			1,000		1,165	New Orleans Aviation Board (credit support
	7.00%, 02/15/2018			360		402	from ASSURED GTY)
							6.00%, 01/01/2023 ^(b)			1,000		1,167
	7.25%, 11/01/2038			1,000		1,195
	Illinois State Toll Highway Authority									$		4,304
	5.25%, 01/01/2030			1,000		1,149	Maryland - 0.53%
	State of Illinois						Maryland Economic Development Corp
	5.50%, 07/01/2027			3,410		3,820	5.75%, 06/01/2035			545		587
	United City of Yorkville IL						Maryland Health & Higher Educational
	5.75%, 03/01/2028			500		506	Facilities Authority
	6.00%, 03/01/2036			300		288	6.00%, 07/01/2041			500		576
	Village of Bartlett IL									$		1,163
	5.60%, 01/01/2023			300		307
	Village of Bolingbrook IL						Massachusetts - 4.47%
	6.25%, 01/01/2024 ^(e)			500		479	Massachusetts Bay Transportation Authority
	Village of Pingree Grove IL Special Service						5.25%, 07/01/2028			2,000		2,577
	Area No 7						Massachusetts Development Finance Agency
	6.00%, 03/01/2036			64		65	5.75%, 12/01/2042			1,000		1,206
				$		22,787	Massachusetts Educational Financing
							Authority
	Indiana - 2.21%						4.90%, 07/01/2028			3,495		3,708
	City of Rockport IN						Massachusetts Health & Educational Facilities
	7.00%, 06/01/2028			1,000		1,016	Authority (credit support from GO OF UNIV)
	Indiana Finance Authority						5.00%, 07/01/2038 ^(b)			1,000		1,117
	5.00%, 10/01/2044			700		747	Massachusetts State College Building
	5.38%, 11/01/2032			1,000		1,121	Authority
	Indiana Municipal Power Agency						5.50%, 05/01/2039			1,000		1,145
	6.00%, 01/01/2039			1,000		1,146				$		9,753


Schedule of Investments
Tax-Exempt Bond Fund
October 31, 2014



		Principal						Principal
MUNICIPAL BONDS (continued)		Amount (000's)	Value (000's)		MUNICIPAL BONDS (continued)			Amount (000's)	Value (000's)

Michigan - 1.04%					New York (continued)
City of Detroit MI Sewage Disposal System					Tompkins County Development Corp
Revenue (credit support from AGM)					5.00%, 07/01/2027		$	1,115	$	1,190
7.00%, 07/01/2027 ^(b)	$	1,500	$	1,757				$		16,616
Kent Hospital Finance Authority
5.50%, 01/15/2047		500		505	North Carolina - 0.53%
		$		2,262	City of Raleigh NC Combined Enterprise
					System Revenue
Minnesota - 0.81%					5.00%, 03/01/2031			1,000		1,144
City of Minneapolis MN
6.75%, 11/15/2032		500		591
City of Minneapolis MN (credit support from					Ohio- 2.28	%
ASSURED GTY)					City of Cincinnati OH
6.50%, 11/15/2038 (b)		1,000		1,176	5.00%, 12/01/2032			815		927
					County of Montgomery OH
		$		1,767	6.25%, 11/15/2033			1,310		1,313
Nebraska - 1.54%					Ohio Air Quality Development Authority
Municipal Energy Agency of Nebraska (credit					5.63%, 06/01/2018			1,000		1,119
support from BHAC)					Ohio Higher Educational Facility
5.13%, 04/01/2029 ^(b)		1,000		1,136	Commission
Omaha Public Power District					6.75%, 01/15/2039			1,000		1,014
5.50%, 02/01/2039		1,000		1,120	Ohio Housing Finance Agency (credit support
University of Nebraska					from GNMA/FNMA/FHLMC COLL)
5.25%, 07/01/2039		1,000		1,122	5.20%, 09/01/2029 ^(b)			550		587
		$		3,378				$		4,960

Nevada - 0.52%					Pennsylvania - 4.11%
County of Clark NV					Allegheny County Industrial Development
5.13%, 07/01/2034		1,000		1,126	Authority
					6.00%, 07/15/2038			1,000		1,017
					City of Scranton PA
New Hampshire - 0.49%					7.25%, 09/01/2023			600		603
City of Manchester NH General Airport					8.50%, 09/01/2022			700		731
Revenue (credit support from AGM)					Pennsylvania Economic Development
5.13%, 01/01/2030 ^(b)		1,000		1,077
					Financing Authority
					6.00%, 06/01/2031			500		501
New Jersey - 1.83%					Pennsylvania Turnpike Commission
Casino Reinvestment Development Authority					0.00%, 12/01/2028 ^(d),(e)			800		864
5.25%, 11/01/2039		750		804	0.00%, 12/01/2034 ^(d),(e)			500		537
New Jersey Economic Development					5.00%, 12/01/2034			2,000		2,253
Authority					Pottsville Hospital Authority/PA
5.00%, 09/01/2034		1,000		1,083	6.50%, 07/01/2028			2,300		2,423
5.75%, 04/01/2031		1,000		1,152				$		8,929
5.75%, 06/01/2031		550		608
New Jersey Housing & Mortgage Finance					Puerto Rico - 0.52%
Agency					Government Development Bank for Puerto
6.38%, 10/01/2028		315		328	Rico
		$		3,975	5.00%, 12/01/2014			1,145		1,137

New York - 7.63%					South Carolina - 0.51%
Brooklyn Arena Local Development Corp					South Carolina Jobs-Economic Development
6.38%, 07/15/2043		1,400		1,588	Authority (credit support from ASSURED
Hudson Yards Infrastructure Corp					GTY)
5.75%, 02/15/2047		2,500		2,878	5.38%, 02/01/2029 ^(b)			1,000		1,109
Metropolitan Transportation Authority
5.25%, 11/15/2030		1,500		1,725
New York City Industrial Development					Tennessee - 0.37%
Agency (credit support from ASSURED					Chattanooga Health Educational & Housing
GTY)					Facility Board
6.13%, 01/01/2029 ^(b)		1,000		1,157	5.50%, 10/01/2020			295		300
New York City Transitional Finance Authority					Shelby County Health Educational & Housing
Building Aid Revenue (credit support from					Facilities Board
ST AID WITHHLDG)					5.63%, 09/01/2026			500		507
5.25%, 01/15/2039 ^(b)		2,145		2,416				$		807
New York Liberty Development Corp
5.00%, 11/15/2031		1,000		1,121	Texas- 5.01	%
5.00%, 09/15/2040		1,000		1,131	Capital Area Cultural Education Facilities
New York Liberty Development Corp (credit					Finance Corp
support from GO OF AUTH)					6.13%, 04/01/2045			1,000		1,154
5.00%,12/15/2041 (b)		1,000		1,123	City of Houston TX Airport System Revenue
					5.00%, 07/01/2029			2,000		2,111
New York State Dormitory Authority (credit					Dallas County Flood Control District No 1
support from ASSURED GTY ST AID
WITHHLDG)					6.75%, 04/01/2016			85		85
5.00%, 10/01/2023 ^(b)		2,000		2,287	Harris County Industrial Development Corp
					5.00%, 02/01/2023			400		436


Schedule of Investments
Tax-Exempt Bond Fund
October 31, 2014



				Principal					Principal
	MUNICIPAL BONDS (continued)			Amount (000's)		Value (000's)	MUNICIPAL BONDS (continued)		Amount (000's)			Value (000's)

	Texas (continued)						Wisconsin (continued)
	North Texas Health Facilities Development						Public Finance Authority
	Corp (credit support from AGM)							6.00%, 07/15/2042	$	500	$	531
	5.00%, 09/01/2024 ^(b)		$	1,000	$	1,096	State of Wisconsin (credit support from ST
	North Texas Tollway Authority						APPROP)
	5.63%, 01/01/2033			1,000		1,111		5.38%, 05/01/2025 ^(b)		1,000		1,169
	5.75%, 01/01/2033			1,130		1,258	Wisconsin Health & Educational Facilities
	Sea Breeze Public Facility Corp						Authority
	6.50%, 01/01/2046			100		102		6.38%, 02/15/2029		500		583
	Tarrant County Cultural Education Facilities							6.63%, 02/15/2039		720		841
	Finance Corp (credit support from ASSURED									$		8,287
	GTY)						TOTAL MUNICIPAL BONDS			$		218,468
	6.25%, 07/01/2028 ^(b)			1,000		1,150	Total Investments			$		220,658
	Texas A&M University						Liability for Floating Rate Notes Issued in Conjunction with
	5.00%, 05/15/2027			1,000		1,150	Securities Held - (3.50)%
	Texas Private Activity Bond Surface						Notes with an interest rate of 0.06% at October		$	(7,621	)$	(7,621	)
	Transportation Corp						31, 2014 and contractual maturity of collateral
	7.00%, 12/31/2038			1,000		1,239	from 2017-2020.^(f)
				$		10,892	Total Net Investments			$		213,037
	Utah- 0.45	%					Other Assets in Excess of Liabilities, Net - 2.21%			$		4,806
	Utah Housing Corp						TOTAL NET ASSETS - 100.00%			$		217,843
	5.75%, 07/01/2036			940		971

							(a)	Security exempt from registration under Rule 144A of the Securities Act of
	Virgin Islands - 0.33%							1933. These securities may be resold in transactions exempt from
	Virgin Islands Public Finance Authority							registration, normally to qualified institutional buyers. Unless otherwise
	5.00%, 10/01/2025			650		721		indicated, these securities are not considered illiquid. At the end of the
								period, the value of these securities totaled $3,349 or 1.54% of net assets.
	Virginia - 2.46%						(b)	Credit support indicates investments that benefit from credit enhancement
	County of Botetourt VA							or liquidity support provided by a third party bank, institution, or
	6.00%, 07/01/2034			1,000		1,019		government agency.
	6.00%, 07/01/2044			1,000		1,001	(c)	Security or portion of underlying security related to Inverse Floaters
	Fairfax County Industrial Development							entered into by the Fund. See Notes to Financial Statements for additional
	Authority							information.
	5.00%, 05/15/2035 ^(c)			700		785	(d)	Non-Income Producing Security
	Roanoke Economic Development Authority						(e)	Variable Rate. Rate shown is in effect at October 31, 2014.
	6.63%, 12/01/2044			1,295		1,435	(f)	Floating rate securities. The interest rate(s) shown reflect the rates in
	Shops at White Oak Village Community							effect at October 31, 2014
	Development Authority/The
	5.30%, 03/01/2017			200		212
	Washington County Industrial Development							Portfolio Summary (unaudited)
	Authority/VA						Sector					Percent
	7.50%, 07/01/2029			750		885	Revenue Bonds					62.61	%
				$		5,337	Insured					25.38	%
	Washington - 3.23%						General Obligation Unlimited					6.72	%
	FYI Properties						Prerefunded					3.58	%
	5.50%, 06/01/2039			1,000		1,140	Government					1.00	%
	State of Washington						Special Assessment					0.63	%
	6.40%, 06/01/2017			2,260		2,466	Tax Allocation					0.58	%
	Washington Health Care Facilities Authority						Special Tax					0.52	%
	7.38%, 03/01/2038			1,000		1,266	Certificate Participation					0.27	%
	Washington Health Care Facilities						Liability For Floating Rate Notes Issued					(3.50	)%
	Authority (credit support from AGM)						Other Assets in Excess of Liabilities, Net					2.21	%
	5.50%, 08/15/2038 ^(b)			1,000		1,090	TOTAL NET ASSETS					100.00	%
	Washington Higher Education Facilities
	Authority
	5.63%, 10/01/2040			1,000		1,084
				$		7,046

	West Virginia - 0.76%
	County of Ohio WV
	5.85%, 06/01/2034			250		259
	West Virginia Hospital Finance Authority
	5.50%, 06/01/2034			1,250		1,394
				$		1,653

	Wisconsin - 3.81%
	City of Superior WI (credit support from GO
	OF CORP)
	5.38%, 11/01/2021 ^(b)			750		806
	County of Milwaukee WI Airport
	Revenue (credit support from AGM)
	5.25%, 12/01/2025 ^(b)			4,000		4,357


						FINANCIAL HIGHLIGHTS
PRINCIPAL FUNDS, INC.

Selected data for a share of Capital Stock outstanding throughout each year ended October 31 (except as noted):


		Net Asset		Net		Net Realized						Dividends					Total
		Value,		Investment		and Unrealized			Total From			from Net		Tax Return			Dividends			Net Asset
		Beginning		Income		Gain (Loss) on			Investment			Investment		of Capital			and			Value, End
		of Period		(Loss)(a)		Investments			Operations			Income		Distribution			Distributions			of Period	Total Return(b)
BOND & MORTGAGE SECURITIES FUND
Class A shares
2014	$	10.80	$	0.23	$	0.20		$	0.43		($	0.26	)	$–		($	0.26	)	$	10.97	4.02	%
2013		11.09		0.24		(0.30	)		(0.06	)		(0.23	)	–			(0.23	)		10.80	(0.52	)
2012		10.63		0.29		0.49			0.78			(0.32	)	–			(0.32	)		11.09	7.49
2011		10.57		0.37		0.08			0.45			(0.38	)	(0.01	)		(0.39	)		10.63	4.33
2010		9.69		0.41		0.81			1.22			(0.34	)	–			(0.34	)		10.57	12.83
Class B shares
2014		10.83		0.16		0.18			0.34			(0.18	)	–			(0.18	)		10.99	3.17
2013		11.12		0.17		(0.30	)		(0.13	)		(0.16	)	–			(0.16	)		10.83	(1.18	)
2012		10.65		0.22		0.50			0.72			(0.25	)	–			(0.25	)		11.12	6.87
2011		10.60		0.30		0.07			0.37			(0.31	)	(0.01	)		(0.32	)		10.65	3.54
2010		9.70		0.35		0.82			1.17			(0.27	)	–			(0.27	)		10.60	12.29
Class C shares
2014		10.80		0.14		0.19			0.33			(0.16	)	–			(0.16	)		10.97	3.12
2013		11.09		0.15		(0.30	)		(0.15	)		(0.14	)	–			(0.14	)		10.80	(1.33	)
2012		10.63		0.20		0.50			0.70			(0.24	)	–			(0.24	)		11.09	6.63
2011		10.57		0.28		0.08			0.36			(0.29	)	(0.01	)		(0.30	)		10.63	3.49
2010		9.69		0.33		0.81			1.14			(0.26	)	–			(0.26	)		10.57	11.93
CALIFORNIA MUNICIPAL FUND
Class A shares
2014		9.75		0.43		0.74			1.17			(0.41	)	–			(0.41	)		10.51	12.28
2013		10.45		0.43		(0.69	)		(0.26	)		(0.44	)	–			(0.44	)		9.75	(2.57	)
2012		9.71		0.43		0.73			1.16			(0.42	)	–			(0.42	)		10.45	12.18
2011		10.00		0.46		(0.28	)		0.18			(0.47	)	–			(0.47	)		9.71	2.03
2010		9.57		0.48		0.42			0.90			(0.47	)	–			(0.47	)		10.00	9.59
Class B shares
2014		9.75		0.33		0.74			1.07			(0.31	)	–			(0.31	)		10.51	11.11
2013		10.45		0.33		(0.70	)		(0.37	)		(0.33	)	–			(0.33	)		9.75	(3.58	)
2012		9.71		0.33		0.73			1.06			(0.32	)	–			(0.32	)		10.45	11.01
2011		10.00		0.37		(0.29	)		0.08			(0.37	)	–			(0.37	)		9.71	1.00
2010		9.57		0.40		0.41			0.81			(0.38	)	–			(0.38	)		10.00	8.66
Class C shares
2014		9.77		0.33		0.74			1.07			(0.31	)	–			(0.31	)		10.53	11.15
2013		10.47		0.33		(0.70	)		(0.37	)		(0.33	)	–			(0.33	)		9.77	(3.57	)
2012		9.73		0.34		0.73			1.07			(0.33	)	–			(0.33	)		10.47	11.12
2011		10.01		0.37		(0.27	)		0.10			(0.38	)	–			(0.38	)		9.73	1.15
2010		9.58		0.39		0.42			0.81			(0.38	)	–			(0.38	)		10.01	8.59


						FINANCIAL HIGHLIGHTS (Continued)
						PRINCIPAL FUNDS, INC.



		Ratio of		Ratio of Expenses to				Ratio of Net
		Expenses to		Average Net Assets		Ratio of Gross		Investment Income
	Net Assets, End of	Average Net		(Excluding Interest		Expenses to Average		to Average Net		Portfolio
	Period (in thousands)	Assets		Expense and Fees)		Net Assets		Assets		Turnover Rate


$	101,747	0.88	%(c)	N/A		–%		2.15	%	204.5	%
	106,666	0.94	(c)	N/A		–		2.16		205.6
	127,605	0.94	(c)	N/A		–		2.65		218.6
	130,506	0.94	(c)	N/A		–		3.50		265.5
	134,686	0.94	(c)	N/A		–		4.12		357.4

	1,201	1.60	(c)	N/A		–		1.44		204.5
	1,624	1.60	(c)	N/A		–		1.50		205.6
	3,741	1.60	(c)	N/A		–		2.04		218.6
	6,636	1.60	(c)	N/A		–		2.86		265.5
	10,488	1.60	(c)	N/A		–		3.47		357.4

	6,654	1.75	(c)	N/A		–		1.28		204.5
	6,967	1.75	(c)	N/A		–		1.35		205.6
	8,861	1.75	(c)	N/A		–		1.82		218.6
	7,106	1.75	(c)	N/A		–		2.68		265.5
	5,976	1.75	(c)	N/A		–		3.30		357.4


	215,618	0.81		0.77	% (d)	–		4.25		28.7
	163,521	0.81		0.77	(d)	–		4.25		20.4
	212,099	0.81		0.77	(d)	–		4.26		21.9
	202,248	0.86		0.81	(d)	–		4.91		45.4
	255,698	0.88		0.81	(d)	0.88	(e)	4.90		32.0

	386	1.86		1.82	(d)	5.19	(f)	3.29		28.7
	882	1.86		1.82	(d)	3.81	(f)	3.19		20.4
	1,718	1.86		1.82	(d)	2.40	(f)	3.23		21.9
	2,673	1.90		1.85	(d)	1.94	(f)	3.97		45.4
	13,589	1.74		1.67	(d)	1.74	(e)	4.08		32.0

	11,563	1.79		1.75	(d)	–		3.27		28.7
	8,301	1.84		1.80	(d)	–		3.23		20.4
	10,486	1.74		1.70	(d)	–		3.33		21.9
	9,786	1.82		1.77	(d)	–		3.95		45.4
	13,572	1.79		1.72	(d)	1.79	(e)	3.98		32.0

Selected data for a share of Capital Stock outstanding throughout each year ended October 31 (except as noted):


			Net Asset		Net			Net Realized						Dividends			Total
			Value,		Investment			and Unrealized			Total From			from Net			Dividends			Net Asset
			Beginning		Income			Gain (Loss) on			Investment			Investment			and			Value, End
			of Period		(Loss)(a)			Investments			Operations			Income			Distributions			of Period	Total Return(b)
DIVERSIFIED INTERNATIONAL FUND
Class A shares
2014		$	11.79	$	0.13		$	0.22		$	0.35		($	0.18	)	($	0.18	)	$	11.96	2.94	%
2013			9.88		0.14			1.93			2.07			(0.16	)		(0.16	)		11.79	21.15
2012			9.41		0.16			0.41			0.57			(0.10	)		(0.10	)		9.88	6.13
2011			9.80		0.15			(0.45	)		(0.30	)		(0.09	)		(0.09	)		9.41	(3.17	)
2010			8.67		0.07			1.17			1.24			(0.11	)		(0.11	)		9.80	14.37
Class B shares
2014			11.78		(0.01	)		0.23			0.22			(0.01	)		(0.01	)		11.99	1.84
2013			9.84		0.02			1.93			1.95			(0.01	)		(0.01	)		11.78	19.88
2012			9.36		0.06			0.42			0.48			–			–			9.84	5.13
2011			9.78		0.03			(0.45	)		(0.42	)		–			–			9.36	(4.29	)
2010			8.66		(0.03	)		1.15			1.12			–			–			9.78	12.98
Class C shares
2014			11.77		0.04			0.21			0.25			(0.11	)		(0.11	)		11.91	2.10
2013			9.86		0.07			1.93			2.00			(0.09	)		(0.09	)		11.77	20.47
2012			9.38		0.10			0.41			0.51			(0.03	)		(0.03	)		9.86	5.47
2011			9.78		0.08			(0.45	)		(0.37	)		(0.03	)		(0.03	)		9.38	(3.78	)
2010			8.67		0.03			1.15			1.18			(0.07	)		(0.07	)		9.78	13.61
Class P shares
2014			11.74		0.17			0.21			0.38			(0.22	)		(0.22	)		11.90	3.25
2013			9.85		0.19			1.90			2.09			(0.20	)		(0.20	)		11.74	21.55
2012			9.38		0.20			0.41			0.61			(0.14	)		(0.14	)		9.85	6.67
2011			9.80		0.14			(0.42	)		(0.28	)		(0.14	)		(0.14	)		9.38	(2.93	)
2010	(e)		9.35		0.01			0.44			0.45			–			–			9.80	4.81	(f)

Selected data for a share of Capital Stock outstanding throughout each year ended October 31 (except as noted):


			Net Asset		Net		Net Realized				Dividends			Total
			Value,		Investment		and Unrealized		Total From		from Net			Dividends			Net Asset
			Beginning		Income		Gain (Loss) on		Investment		Investment			and			Value, End
			of Period		(Loss)(a)		Investments		Operations		Income			Distributions			of Period	Total Return(b)
EQUITY INCOME FUND
Class A shares
2014		$	23.14	$	0.56	$	3.04	$	3.60	($	0.47	)	($	0.47	)	$	26.27	15.66	%
2013			19.47		0.55		3.65		4.20		(0.53	)		(0.53	)		23.14	21.87
2012			17.57		0.50		1.87		2.37		(0.47	)		(0.47	)		19.47	13.64
2011			16.91		0.49		0.63		1.12		(0.46	)		(0.46	)		17.57	6.69
2010			14.38		0.43		2.48		2.91		(0.38	)		(0.38	)		16.91	20.49
Class B shares
2014			22.96		0.38		2.99		3.37		(0.24	)		(0.24	)		26.09	14.74
2013			19.30		0.37		3.61		3.98		(0.32	)		(0.32	)		22.96	20.84
2012			17.42		0.33		1.85		2.18		(0.30	)		(0.30	)		19.30	12.58
2011			16.76		0.34		0.62		0.96		(0.30	)		(0.30	)		17.42	5.76
2010			14.25		0.28		2.46		2.74		(0.23	)		(0.23	)		16.76	19.33
Class C shares
2014			22.65		0.37		2.96		3.33		(0.29	)		(0.29	)		25.69	14.79
2013			19.07		0.38		3.58		3.96		(0.38	)		(0.38	)		22.65	21.01
2012			17.22		0.35		1.84		2.19		(0.34	)		(0.34	)		19.07	12.83
2011			16.59		0.36		0.61		0.97		(0.34	)		(0.34	)		17.22	5.87
2010			14.11		0.31		2.43		2.74		(0.26	)		(0.26	)		16.59	19.61
Class P shares
2014			23.15		0.62		3.05		3.67		(0.54	)		(0.54	)		26.28	15.99
2013			19.47		0.61		3.66		4.27		(0.59	)		(0.59	)		23.15	22.27
2012			17.57		0.54		1.88		2.42		(0.52	)		(0.52	)		19.47	13.91
2011			16.93		0.51		0.66		1.17		(0.53	)		(0.53	)		17.57	6.95
2010	(d)		16.45		0.05		0.54		0.59		(0.11	)		(0.11	)		16.93	3.59	(e)


							FINANCIAL HIGHLIGHTS
PRINCIPAL FUNDS, INC.


Selected data for a share of Capital Stock outstanding throughout each year ended October 31 (except as noted):


			Net Asset		Net		Net Realized						Dividends		Distributions			Total
			Value,		Investment		and Unrealized			Total From			from Net		from			Dividends			Net Asset
			Beginning		Income		Gain (Loss) on			Investment			Investment		Realized			and			Value, End
			of Period		(Loss)(a)		Investments			Operations			Income		Gains			Distributions			of Period	Total Return(b)
GLOBAL DIVERSIFIED INCOME FUND
Class A shares
2014		$	14.23	$	0.63	$	0.51		$	1.14		($	0.61	)	$–		($	0.61	)	$	14.76	8.18	%
2013			14.14		0.67		0.20			0.87			(0.66	)	(0.12	)		(0.78	)		14.23	6.40
2012			12.98		0.76		1.16			1.92			(0.72	)	(0.04	)		(0.76	)		14.14	15.25
2011			13.35		0.79		(0.35	)		0.44			(0.70	)	(0.11	)		(0.81	)		12.98	3.25
2010			12.72		0.73		1.71			2.44			(0.76	)	(1.05	)		(1.81	)		13.35	21.38
Class C shares
2014			14.17		0.52		0.51			1.03			(0.51	)	–			(0.51	)		14.69	7.27	(e)
2013			14.08		0.55		0.22			0.77			(0.56	)	(0.12	)		(0.68	)		14.17	5.65
2012			12.93		0.66		1.15			1.81			(0.62	)	(0.04	)		(0.66	)		14.08	14.39
2011			13.30		0.69		(0.35	)		0.34			(0.60	)	(0.11	)		(0.71	)		12.93	2.55
2010			12.68		0.63		1.71			2.34			(0.67	)	(1.05	)		(1.72	)		13.30	20.44
Class P shares
2014			14.17		0.66		0.51			1.17			(0.65	)	–			(0.65	)		14.69	8.43
2013			14.09		0.69		0.21			0.90			(0.70	)	(0.12	)		(0.82	)		14.17	6.63
2012			12.93		0.79		1.16			1.95			(0.75	)	(0.04	)		(0.79	)		14.09	15.59
2011			13.31		0.83		(0.36	)		0.47			(0.74	)	(0.11	)		(0.85	)		12.93	3.51
2010	(f)		13.01		0.08		0.34			0.42			(0.12	)	–			(0.12	)		13.31	3.21	(g)
GLOBAL REAL ESTATE SECURITIES FUND
Class A shares
2014			8.30		0.10		0.76			0.86			(0.16	)	(0.28	)		(0.44	)		8.72	11.07
2013			7.83		0.11		0.94			1.05			(0.43	)	(0.15	)		(0.58	)		8.30	13.94
2012			6.72		0.10		1.16			1.26			(0.15	)	–			(0.15	)		7.83	19.08
2011			6.83		0.08		(0.06	)		0.02			(0.09	)	(0.04	)		(0.13	)		6.72	0.28
2010			5.66		0.10		1.35			1.45			(0.28	)	–			(0.28	)		6.83	26.27
Class C shares
2014			8.12		0.03		0.74			0.77			(0.11	)	(0.28	)		(0.39	)		8.50	10.08
2013			7.67		0.04		0.93			0.97			(0.37	)	(0.15	)		(0.52	)		8.12	13.19
2012			6.59		0.05		1.14			1.19			(0.11	)	–			(0.11	)		7.67	18.27
2011			6.71		0.03		(0.06	)		(0.03	)		(0.05	)	(0.04	)		(0.09	)		6.59	(0.52	)
2010			5.58		0.06		1.31			1.37			(0.24	)	–			(0.24	)		6.71	25.19
Class P shares
2014			8.78		0.12		0.81			0.93			(0.18	)	(0.28	)		(0.46	)		9.25	11.33
2013			8.24		0.14		1.00			1.14			(0.45	)	(0.15	)		(0.60	)		8.78	14.36
2012			7.07		0.14		1.20			1.34			(0.17	)	–			(0.17	)		8.24	19.37
2011	(i)		7.35		0.11		(0.28	)		(0.17	)		(0.11	)	–			(0.11	)		7.07	(2.25	) (g)


						FINANCIAL HIGHLIGHTS (Continued)
						PRINCIPAL FUNDS, INC.

Ratio of Expenses to
Average Net Assets
(Excluding
		Ratio of		Dividends and		Ratio of Net
		Expenses to		Interest Expense on		Investment Income
	Net Assets, End of	Average Net		Short Sales and Short		to Average Net		Portfolio
	Period (in thousands)	Assets		Sale Fees)		Assets		Turnover Rate


$	2,466,867	1.17	%(c)	1.08	%(d)	4.33	%	83.4	%
	2,658,057	1.15	(c)	1.10	(d)	4.71		79.0
	2,019,170	1.13	(c)	–		5.64		50.8
	996,753	1.16	(c)	–		5.94		47.6
	630,204	1.16	(c)	–		5.76		75.5

	2,766,661	1.92	(c)	1.83	(d)	3.56		83.4
	2,372,549	1.91	(c)	1.86	(d)	3.94		79.0
	1,535,844	1.89	(c)	–		4.87		50.8
	727,143	1.90	(c)	–		5.22		47.6
	296,132	1.92	(c)	–		4.98		75.5

	3,329,928	0.91	(c)	0.82	(d)	4.55		83.4
	2,285,742	0.89	(c)	0.84	(d)	4.93		79.0
	1,125,168	0.90	(c)	–		5.84		50.8
	420,384	0.83	(c)	–		6.38		47.6
	1,001	0.99 (c)	,(h)	–		7.01	(h)	75.5	(h)


	102,093	1.32	(c)	–		1.16		29.3
	70,426	1.37	(c)	–		1.40		52.4
	20,896	1.45	(c)	–		1.46		87.9
	13,483	1.45	(c)	–		1.18		78.8
	16,738	1.45	(c)	–		1.61		194.8

	47,399	2.14	(c)	–		0.33		29.3
	24,808	2.20	(c)	–		0.53		52.4
	5,021	2.20	(c)	–		0.70		87.9
	2,887	2.20	(c)	–		0.45		78.8
	1,453	2.20	(c)	–		0.95		194.8

	109,673	1.06	(c)	–		1.39		29.3
	51,000	1.08	(c)	–		1.61		52.4
	6,970	1.09	(c)	–		1.78		87.9
	3,378	1.10 (c)	,(h)	–		1.80	(h)	78.8	(h)

Selected data for a share of Capital Stock outstanding throughout each year ended October 31 (except as noted):


			Net Asset		Net		Net Realized						Dividends			Total
			Value,		Investment		and Unrealized			Total From			from Net			Dividends			Net Asset
			Beginning		Income		Gain (Loss) on			Investment			Investment			and			Value, End
			of Period		(Loss)(a)		Investments			Operations			Income			Distributions			of Period	Total Return(b )
GOVERNMENT & HIGH QUALITY BOND FUND
Class A shares
2014		$	10.98	$	0.24	$	0.13		$	0.37		($	0.32	)	($	0.32	)	$	11.03	3.39	%
2013			11.37		0.24		(0.31	)		(0.07	)		(0.32	)		(0.32	)		10.98	(0.61	)
2012			11.26		0.31		0.20			0.51			(0.40	)		(0.40	)		11.37	4.58
2011			11.28		0.37		0.02			0.39			(0.41	)		(0.41	)		11.26	3.60
2010			10.89		0.42		0.41			0.83			(0.44	)		(0.44	)		11.28	7.82
Class B shares
2014			10.97		0.15		0.12			0.27			(0.22	)		(0.22	)		11.02	2.51
2013			11.36		0.15		(0.31	)		(0.16	)		(0.23	)		(0.23	)		10.97	(1.46	)
2012			11.25		0.22		0.19			0.41			(0.30	)		(0.30	)		11.36	3.71
2011			11.27		0.28		0.02			0.30			(0.32	)		(0.32	)		11.25	2.75
2010			10.89		0.33		0.40			0.73			(0.35	)		(0.35	)		11.27	6.86
Class C shares
2014			10.97		0.15		0.12			0.27			(0.22	)		(0.22	)		11.02	2.52
2013			11.36		0.15		(0.31	)		(0.16	)		(0.23	)		(0.23	)		10.97	(1.44	)
2012			11.25		0.21		0.20			0.41			(0.30	)		(0.30	)		11.36	3.73
2011			11.27		0.28		0.02			0.30			(0.32	)		(0.32	)		11.25	2.76
2010			10.88		0.33		0.42			0.75			(0.36	)		(0.36	)		11.27	6.97
Class P shares
2014			11.00		0.25		0.13			0.38			(0.33	)		(0.33	)		11.05	3.47
2013			11.39		0.25		(0.31	)		(0.06	)		(0.33	)		(0.33	)		11.00	(0.52	)
2012			11.28		0.32		0.20			0.52			(0.41	)		(0.41	)		11.39	4.68
2011			11.28		0.37		0.05			0.42			(0.42	)		(0.42	)		11.28	3.87
2010	(f)		11.24		0.04		0.04			0.08			(0.04	)		(0.04	)		11.28	0.71	(g)


							FINANCIAL HIGHLIGHTS
PRINCIPAL FUNDS, INC.

Selected data for a share of Capital Stock outstanding throughout each year ended October 31 (except as noted):


			Net Asset		Net		Net Realized					Dividends			Distributions			Total
			Value,		Investment		and Unrealized			Total From		from Net			from			Dividends			Net Asset
			Beginning		Income		Gain (Loss) on			Investment		Investment			Realized			and			Value, End
			of Period		(Loss)(a)		Investments			Operations		Income			Gains			Distributions			of Period	Total Return(b )
HIGH YIELD FUND
Class A shares
2014		$	7.94	$	0.43	($	0.03	)	$	0.40	($	0.46	)	($	0.16	)	($	0.62	)	$	7.72	5.32	%
2013			7.84		0.49		0.19			0.68		(0.51	)		(0.07	)		(0.58	)		7.94	8.90
2012			7.72		0.52		0.40			0.92		(0.54	)		(0.26	)		(0.80	)		7.84	12.85
2011			8.18		0.60		(0.28	)		0.32		(0.63	)		(0.15	)		(0.78	)		7.72	4.06
2010			7.61		0.65		0.58			1.23		(0.66	)		–			(0.66	)		8.18	16.87
Class B shares
2014			7.99		0.37		(0.04	)		0.33		(0.40	)		(0.16	)		(0.56	)		7.76	4.34
2013			7.88		0.43		0.19			0.62		(0.44	)		(0.07	)		(0.51	)		7.99	8.07
2012			7.76		0.46		0.40			0.86		(0.48	)		(0.26	)		(0.74	)		7.88	11.85
2011			8.22		0.54		(0.28	)		0.26		(0.57	)		(0.15	)		(0.72	)		7.76	3.24
2010			7.65		0.59		0.58			1.17		(0.60	)		–			(0.60	)		8.22	15.86
Class C shares
2014			8.01		0.38		(0.04	)		0.34		(0.41	)		(0.16	)		(0.57	)		7.78	4.42
2013			7.90		0.44		0.19			0.63		(0.45	)		(0.07	)		(0.52	)		8.01	8.18
2012			7.77		0.47		0.40			0.87		(0.48	)		(0.26	)		(0.74	)		7.90	12.07
2011			8.23		0.55		(0.29	)		0.26		(0.57	)		(0.15	)		(0.72	)		7.77	3.29
2010			7.66		0.59		0.58			1.17		(0.60	)		–			(0.60	)		8.23	15.91
Class P shares
2014			7.94		0.45		(0.02	)		0.43		(0.49	)		(0.16	)		(0.65	)		7.72	5.62
2013			7.84		0.51		0.19			0.70		(0.53	)		(0.07	)		(0.60	)		7.94	9.16
2012			7.72		0.54		0.40			0.94		(0.56	)		(0.26	)		(0.82	)		7.84	13.08
2011			8.15		0.61		(0.24	)		0.37		(0.65	)		(0.15	)		(0.80	)		7.72	4.74
2010	(d)		8.00		0.06		0.15			0.21		(0.06	)		–			(0.06	)		8.15	2.67	(e)
HIGH YIELD FUND I
Class A shares
2014			10.76		0.54		(0.06	)		0.48		(0.54	)		(0.21	)		(0.75	)		10.49	4.56
2013	(g)		10.70		0.36		0.07			0.43		(0.37	)		–			(0.37	)		10.76	4.11	(e)


								FINANCIAL HIGHLIGHTS
PRINCIPAL FUNDS, INC.

Selected data for a share of Capital Stock outstanding throughout each year ended October 31 (except as noted):

			Net Asset		Net			Net Realized						Dividends		Distributions			Total
			Value,		Investment			and Unrealized			Total From			from Net		from			Dividends			Net Asset
			Beginning		Income			Gain (Loss) on			Investment			Investment		Realized			and			Value, End
			of Period		(Loss)(a)			Investments			Operations			Income		Gains			Distributions			of Period	Total Return(b)
INCOME FUND
Class A shares
2014		$	9.65	$	0.32		$	0.13		$	0.45		($	0.34	)	$–		($	0.34	)	$	9.76	4.77	%
2013			9.98		0.34			(0.31	)		0.03			(0.36	)	–			(0.36	)		9.65	0.36
2012			9.55		0.41			0.45			0.86			(0.43	)	–			(0.43	)		9.98	9.23
2011			9.65		0.45			(0.07	)		0.38			(0.48	)	–			(0.48	)		9.55	4.12
2010			9.26		0.50			0.41			0.91			(0.52	)	–			(0.52	)		9.65	10.14
Class B shares
2014			9.69		0.22			0.13			0.35			(0.24	)	–			(0.24	)		9.80	3.66
2013			10.01		0.24			(0.30	)		(0.06	)		(0.26	)	–			(0.26	)		9.69	(0.55	)
2012			9.59		0.32			0.44			0.76			(0.34	)	–			(0.34	)		10.01	8.09
2011			9.69		0.37			(0.07	)		0.30			(0.40	)	–			(0.40	)		9.59	3.21
2010			9.29		0.42			0.42			0.84			(0.44	)	–			(0.44	)		9.69	9.32
Class C shares
2014			9.70		0.24			0.13			0.37			(0.26	)	–			(0.26	)		9.81	3.90
2013			10.03		0.26			(0.30	)		(0.04	)		(0.29	)	–			(0.29	)		9.70	(0.42	)
2012			9.60		0.33			0.45			0.78			(0.35	)	–			(0.35	)		10.03	8.33
2011			9.70		0.38			(0.07	)		0.31			(0.41	)	–			(0.41	)		9.60	3.30
2010			9.30		0.42			0.43			0.85			(0.45	)	–			(0.45	)		9.70	9.35
Class P shares
2014			9.67		0.33			0.14			0.47			(0.36	)	–			(0.36	)		9.78	4.94
2013			10.00		0.36			(0.31	)		0.05			(0.38	)	–			(0.38	)		9.67	0.56
2012			9.57		0.43			0.45			0.88			(0.45	)	–			(0.45	)		10.00	9.42
2011			9.67		0.46			(0.06	)		0.40			(0.50	)	–			(0.50	)		9.57	4.31
2010	(d)		9.66		0.05			0.01			0.06			(0.05	)	–			(0.05	)		9.67	0.60	(e)
INFLATION PROTECTION FUND
Class A shares
2014			8.69		0.05			0.04			0.09			–		(0.16	)		(0.16	)		8.62	1.07
2013			9.32		0.02			(0.63	)		(0.61	)		(0.02	)	–			(0.02	)		8.69	(6.52	)
2012			8.70		0.04			0.59			0.63			(0.01	)	–			(0.01	)		9.32	7.24
2011			8.29		0.25			0.38			0.63			(0.22	)	–			(0.22	)		8.70	7.74
2010			7.62		0.12			0.68			0.80			(0.13	)	–			(0.13	)		8.29	10.58
Class C shares
2014			8.50		(0.02	)		0.04			0.02			–		(0.16	)		(0.16	)		8.36	0.25
2013			9.16		(0.05	)		(0.61	)		(0.66	)		–		–			–			8.50	(7.21	)
2012			8.61		(0.02	)		0.57			0.55			–		–			–			9.16	6.43
2011			8.23		0.17			0.38			0.55			(0.17	)	–			(0.17	)		8.61	6.85
2010			7.58		0.06			0.68			0.74			(0.09	)	–			(0.09	)		8.23	9.76

Selected data for a share of Capital Stock outstanding throughout each year ended October 31 (except as noted):


			Net Asset		Net			Net Realized						Dividends			Total
			Value,		Investment			and Unrealized			Total From			from Net			Dividends			Net Asset
			Beginning		Income			Gain (Loss) on			Investment			Investment			and			Value, End
			of Period		(Loss)(a)			Investments			Operations			Income			Distributions			of Period	Total Return(b )
INTERNATIONAL EMERGING MARKETS FUND
Class A shares
2014		$	25.11	$	0.18		($	0.23	)	($	0.05	)	($	0.05	)	($	0.05	)	$	25.01	(0.18	)%
2013			24.52		0.18			0.65			0.83			(0.24	)		(0.24	)		25.11	3.34
2012			23.76		0.20			0.74			0.94			(0.18	)		(0.18	)		24.52	4.05
2011			25.69		0.25			(2.16	)		(1.91	)		(0.02	)		(0.02	)		23.76	(7.45	)
2010			20.73		0.08			4.93			5.01			(0.05	)		(0.05	)		25.69	24.22
Class B shares
2014			23.77		(0.08	)		(0.21	)		(0.29	)		–			–			23.48	(1.22	)
2013			23.22		(0.08	)		0.63			0.55			–			–			23.77	2.37
2012			22.52		(0.04	)		0.74			0.70			–			–			23.22	3.11
2011			24.60		(0.03	)		(2.05	)		(2.08	)		–			–			22.52	(8.46	)
2010			20.01		(0.17	)		4.76			4.59			–			–			24.60	22.94
Class C shares
2014			24.24		(0.05	)		(0.23	)		(0.28	)		–			–			23.96	(1.16	)
2013			23.69		(0.06	)		0.61			0.55			–			–			24.24	2.32
2012			22.98		(0.02	)		0.73			0.71			–			–			23.69	3.09
2011			25.06		0.02			(2.10	)		(2.08	)		–			–			22.98	(8.30	)
2010			20.36		(0.13	)		4.83			4.70			–			–			25.06	23.08
Class P shares
2014			24.97		0.28			(0.23	)		0.05			(0.18	)		(0.18	)		24.84	0.20
2013			24.37		0.30			0.65			0.95			(0.35	)		(0.35	)		24.97	3.87
2012			23.65		0.32			0.71			1.03			(0.31	)		(0.31	)		24.37	4.51
2011			25.60		0.48			(2.28	)		(1.80	)		(0.15	)		(0.15	)		23.65	(7.09	)
2010	(d)		24.41		–			1.19			1.19			–			–			25.60	4.88	(e)


							FINANCIAL HIGHLIGHTS
PRINCIPAL FUNDS, INC.

Selected data for a share of Capital Stock outstanding throughout each year ended October 31 (except as noted):


			Net Asset	Net			Net Realized					Dividends		Distributions		Total
			Value,	Investment			and Unrealized			Total From		from Net		from		Dividends			Net Asset
			Beginning	Income			Gain (Loss) on			Investment		Investment		Realized		and			Value, End
			of Period	(Loss)(a)			Investments			Operations		Income		Gains		Distributions			of Period )	Total Return(b
INTERNATIONAL FUND I
Class A shares
2014	(c)	$	13.71	$–		($	0.08	)	($	0.08	)	$–		$–		$–		$	13.63	(0.51)%(d),(e)
Class P shares
2014	(c)		13.71	0.09			(0.15	)		(0.06	)	–		–		–			13.65	(0.36) (d),(e)
LARGECAP GROWTH FUND
Class A shares
2014			11.25	(0.02	)		1.53			1.51		–		(1.21	)	(1.21	)		11.55	14.61
2013			8.68	0.02			2.56			2.58		(0.01	)	–		(0.01	)		11.25	29.76
2012			7.87	(0.01	)		0.82			0.81		–		–		–			8.68	10.29
2011			7.54	(0.03	)		0.36			0.33		–		–		–			7.87	4.38
2010			6.26	(0.04	)		1.32			1.28		–		–		–			7.54	20.45
Class B shares
2014			10.40	(0.13	)		1.39			1.26		–		(1.21	)	(1.21	)		10.45	13.27
2013			8.10	(0.07	)		2.37			2.30		–		–		–			10.40	28.40
2012			7.42	(0.09	)		0.77			0.68		–		–		–			8.10	9.16
2011			7.18	(0.10	)		0.34			0.24		–		–		–			7.42	3.34
2010			6.03	(0.11	)		1.26			1.15		–		–		–			7.18	19.07
Class C shares
2014			10.67	(0.10	)		1.43			1.33		–		(1.21	)	(1.21	)		10.79	13.62
2013			8.30	(0.07	)		2.44			2.37		–		–		–			10.67	28.55
2012			7.58	(0.08	)		0.80			0.72		–		–		–			8.30	9.50
2011			7.33	(0.09	)		0.34			0.25		–		–		–			7.58	3.41
2010			6.13	(0.09	)		1.29			1.20		–		–		–			7.33	19.58
Class P shares
2014			11.51	0.01			1.57			1.58		(0.02	)	(1.21	)	(1.23	)		11.86	14.88
2013			8.90	0.04			2.64			2.68		(0.07	)	–		(0.07	)		11.51	30.26
2012			8.06	0.03			0.83			0.86		(0.02	)	–		(0.02	)		8.90	10.72
2011			7.69	–			0.37			0.37		–		–		–			8.06	4.81
2010	(h)		7.32	–			0.37			0.37		–		–		–			7.69	5.05	(d)
LARGECAP GROWTH FUND I
Class A shares
2014			12.70	(0.06	)		1.60			1.54		–		(0.77	)	(0.77	)		13.47	12.70
2013	(i)		10.52	(0.04	)		2.22			2.18		–		–		–			12.70	20.72	(d)
Class P shares
2014	(c)		12.79	(0.01	)		0.80			0.79		–		–		–			13.58	6.18	(d)


								FINANCIAL HIGHLIGHTS
PRINCIPAL FUNDS, INC.

Selected data for a share of Capital Stock outstanding throughout each year ended October 31 (except as noted):


			Net Asset		Net			Net Realized				Dividends		Distributions			Total
			Value,		Investment			and Unrealized		Total From		from Net		from			Dividends			Net Asset
			Beginning		Income			Gain (Loss) on		Investment		Investment		Realized			and			Value, End
			of Period		(Loss)(a)			Investments		Operations		Income		Gains			Distributions			of Period	Total Return(b)
LARGECAP S&P 500 INDEX FUND
Class A shares
2014		$	12.46	$	0.20		$	1.86	$	2.06	($	0.17	)	$–		($	0.17	)	$	14.35	16.70	%
2013			10.01		0.18			2.42		2.60		(0.15	)	–			(0.15	)		12.46	26.39
2012			8.88		0.14			1.12		1.26		(0.13	)	–			(0.13	)		10.01	14.41
2011			8.35		0.12			0.50		0.62		(0.09	)	–			(0.09	)		8.88	7.46
2010			7.31		0.11			1.03		1.14		(0.10	)	–			(0.10	)		8.35	15.72
Class C shares
2014			12.29		0.09			1.82		1.91		(0.12	)	–			(0.12	)		14.08	15.62
2013			9.89		0.09			2.41		2.50		(0.10	)	–			(0.10	)		12.29	25.48
2012			8.78		0.08			1.11		1.19		(0.08	)	–			(0.08	)		9.89	13.71
2011			8.26		0.06			0.50		0.56		(0.04	)	–			(0.04	)		8.78	6.74
2010			7.25		0.06			1.03		1.09		(0.08	)	–			(0.08	)		8.26	15.06
LARGECAP VALUE FUND
Class A shares
2014			13.58		0.15			1.45		1.60		(0.11	)	(1.17	)		(1.28	)		13.90	12.72
2013			10.89		0.20			2.66		2.86		(0.17	)	–			(0.17	)		13.58	26.68
2012			9.31		0.14			1.52		1.66		(0.08	)	–			(0.08	)		10.89	18.05
2011			8.80		0.09			0.50		0.59		(0.08	)	–			(0.08	)		9.31	6.65
2010			7.84		0.09			0.99		1.08		(0.12	)	–			(0.12	)		8.80	13.81
Class B shares
2014			13.50		–			1.44		1.44		–		(1.17	)		(1.17	)		13.77	11.40
2013			10.79		0.07			2.66		2.73		(0.02	)	–			(0.02	)		13.50	25.32
2012			9.23		0.04			1.52		1.56		–		–			–			10.79	16.90
2011			8.76		(0.02	)		0.49		0.47		–		–			–			9.23	5.37
2010			7.80		(0.02	)		0.98		0.96		–		–			–			8.76	12.35
Class C shares
2014			13.35		0.04			1.42		1.46		(0.06	)	(1.17	)		(1.23	)		13.58	11.78
2013			10.74		0.08			2.64		2.72		(0.11	)	–			(0.11	)		13.35	25.52
2012			9.18		0.07			1.51		1.58		(0.02	)	–			(0.02	)		10.74	17.25
2011			8.70		0.02			0.49		0.51		(0.03	)	–			(0.03	)		9.18	5.81
2010			7.76		0.03			0.99		1.02		(0.08	)	–			(0.08	)		8.70	13.14
Class P shares
2014	(d)		13.46		0.06			0.37		0.43		–		–			–			13.89	3.19	(e)


								FINANCIAL HIGHLIGHTS
PRINCIPAL FUNDS, INC.

Selected data for a share of Capital Stock outstanding throughout each year ended October 31 (except as noted):


			Net Asset		Net			Net Realized			Dividends			Distributions			Total
			Value,		Investment			and Unrealized		Total From	from Net			from			Dividends			Net Asset
			Beginning		Income			Gain (Loss) on		Investment	Investment			Realized			and			Value, End
			of Period		(Loss)(a)			Investments		Operations	Income			Gains			Distributions			of Period	Total Return(b)
MIDCAP FUND
Class A shares
2014		$	19.87	$	0.02		$	2.52	$	2.54	$–		($	0.42	)	($	0.42	)	$	21.99	13.05	%
2013			15.46		0.04			4.74		4.78	(0.14	)		(0.23	)		(0.37	)		19.87	31.58
2012			14.05		0.05			2.20		2.25	(0.03	)		(0.81	)		(0.84	)		15.46	17.19
2011			13.03		0.01			1.64		1.65	(0.14	)		(0.49	)		(0.63	)		14.05	13.03
2010			10.45		0.09			2.53		2.62	(0.04	)		–			(0.04	)		13.03	25.12
Class B shares
2014			19.11		(0.18	)		2.41		2.23	–			(0.42	)		(0.42	)		20.92	11.92
2013			14.91		(0.13	)		4.56		4.43	–			(0.23	)		(0.23	)		19.11	30.15
2012			13.68		(0.09	)		2.13		2.04	–			(0.81	)		(0.81	)		14.91	16.06
2011			12.69		(0.11	)		1.59		1.48	–			(0.49	)		(0.49	)		13.68	11.95
2010			10.24		(0.03	)		2.48		2.45	–			–			–			12.69	23.93
Class C shares
2014			18.90		(0.12	)		2.38		2.26	–			(0.42	)		(0.42	)		20.74	12.22
2013			14.78		(0.09	)		4.53		4.44	(0.09	)		(0.23	)		(0.32	)		18.90	30.63
2012			13.54		(0.05	)		2.10		2.05	–			(0.81	)		(0.81	)		14.78	16.31
2011			12.62		(0.10	)		1.59		1.49	(0.08	)		(0.49	)		(0.57	)		13.54	12.13
2010			10.18		–			2.46		2.46	(0.02	)		–			(0.02	)		12.62	24.22
Class P shares
2014			20.10		0.08			2.56		2.64	(0.04	)		(0.42	)		(0.46	)		22.28	13.43
2013			15.63		0.09			4.78		4.87	(0.17	)		(0.23	)		(0.40	)		20.10	31.94
2012			14.20		0.10			2.22		2.32	(0.08	)		(0.81	)		(0.89	)		15.63	17.60
2011			13.18		0.04			1.66		1.70	(0.19	)		(0.49	)		(0.68	)		14.20	13.32
2010	(d)		12.58		0.01			0.59		0.60	–			–			–			13.18	4.77	(e)

Selected data for a share of Capital Stock outstanding throughout each year ended October 31 (except as noted):


			Net Asset		Net		Net Realized			Dividends	Total
			Value,		Investment		and Unrealized		Total From	from Net	Dividends		Net Asset
			Beginning		Income		Gain (Loss) on		Investment	Investment	and		Value, End
			of Period		(Loss)(a)		Investments		Operations	Income	Distributions		of Period	Total Return(b )
MIDCAP VALUE FUND III
Class A shares
2014	(c)	$	20.10	$	0.03	$	0.41	$	0.44	$–	$–	$	20.54	2.19	%(d)
Class P shares
2014	(c)		20.10		0.08		0.40		0.48	–	–		20.58	2.39	(d)
MONEY MARKET FUND
Class A shares
2014			1.00		–		–		–	–	–		1.00	0.00
2013			1.00		–		–		–	–	–		1.00	0.00
2012			1.00		–		–		–	–	–		1.00	0.00
2011			1.00		–		–		–	–	–		1.00	0.00
2010			1.00		–		–		–	–	–		1.00	0.00
Class B shares
2014			1.00		–		–		–	–	–		1.00	0.00
2013			1.00		–		–		–	–	–		1.00	0.00
2012			1.00		–		–		–	–	–		1.00	0.00
2011			1.00		–		–		–	–	–		1.00	0.00
2010			1.00		–		–		–	–	–		1.00	0.00
Class C shares
2014			1.00		–		–		–	–	–		1.00	0.00
2013			1.00		–		–		–	–	–		1.00	0.00
2012			1.00		–		–		–	–	–		1.00	0.00
2011			1.00		–		–		–	–	–		1.00	0.00
2010			1.00		–		–		–	–	–		1.00	0.00


								FINANCIAL HIGHLIGHTS
PRINCIPAL FUNDS, INC.

Selected data for a share of Capital Stock outstanding throughout each year ended October 31 (except as noted):


			Net Asset		Net			Net Realized				Dividends			Distributions			Total
			Value,		Investment			and Unrealized		Total From		from Net			from			Dividends			Net Asset
			Beginning		Income			Gain (Loss) on		Investment		Investment			Realized			and			Value, End
			of Period		(Loss)(a)			Investments		Operations		Income			Gains			Distributions			of Period	Total Return(b)
PRINCIPAL CAPITAL APPRECIATION FUND
Class A shares
2014		$	52.54	$	0.50		$	7.32	$	7.82	($	0.41	)	($	1.15	)	($	1.56	)	$	58.80	15.22	%
2013			41.72		0.57			11.27		11.84		(0.53	)		(0.49	)		(1.02	)		52.54	28.98
2012			38.14		0.37			3.99		4.36		(0.30	)		(0.48	)		(0.78	)		41.72	11.73
2011			37.16		0.30			2.19		2.49		(0.40	)		(1.11	)		(1.51	)		38.14	6.73
2010			32.55		0.50			4.50		5.00		(0.17	)		(0.22	)		(0.39	)		37.16	15.46
Class B shares
2014			44.05		0.03			6.11		6.14		–			(1.15	)		(1.15	)		49.04	14.22
2013			35.08		0.09			9.47		9.56		(0.10	)		(0.49	)		(0.59	)		44.05	27.64
2012			32.21		(0.02	)		3.37		3.35		–			(0.48	)		(0.48	)		35.08	10.63
2011			31.55		(0.05	)		1.86		1.81		(0.04	)		(1.11	)		(1.15	)		32.21	5.73
2010			27.81		0.10			3.86		3.96		–			(0.22	)		(0.22	)		31.55	14.31
Class C shares
2014			44.06		0.02			6.11		6.13		(0.16	)		(1.15	)		(1.31	)		48.88	14.22
2013			35.19		0.14			9.49		9.63		(0.27	)		(0.49	)		(0.76	)		44.06	27.89
2012			32.29		0.02			3.40		3.42		(0.04	)		(0.48	)		(0.52	)		35.19	10.83
2011			31.73		(0.03	)		1.86		1.83		(0.16	)		(1.11	)		(1.27	)		32.29	5.77
2010			27.94		0.16			3.85		4.01		–			(0.22	)		(0.22	)		31.73	14.42
Class P shares
2014			53.15		0.62			7.40		8.02		(0.53	)		(1.15	)		(1.68	)		59.49	15.45
2013			42.23		0.67			11.40		12.07		(0.66	)		(0.49	)		(1.15	)		53.15	29.27
2012			38.56		0.48			4.05		4.53		(0.38	)		(0.48	)		(0.86	)		42.23	12.07
2011			37.62		0.38			2.22		2.60		(0.55	)		(1.11	)		(1.66	)		38.56	6.95
2010	(d)		35.97		0.02			1.63		1.65		–			–			–			37.62	4.59	(e)


								FINANCIAL HIGHLIGHTS
PRINCIPAL FUNDS, INC.

Selected data for a share of Capital Stock outstanding throughout each year ended October 31 (except as noted):


			Net Asset		Net			Net Realized				Dividends			Distributions			Total
			Value,		Investment			and Unrealized		Total From		from Net			from			Dividends			Net Asset
			Beginning		Income			Gain (Loss) on		Investment		Investment			Realized			and			Value, End
			of Period		(Loss)(a)			Investments		Operations		Income			Gains			Distributions			of Period	Total Return(b)
REAL ESTATE SECURITIES FUND
Class A shares
2014		$	21.63	$	0.19		$	3.63	$	3.82	($	0.29	)	($	2.91	)	($	3.20	)	$	22.25	21.34	%
2013			19.54		0.29			2.01		2.30		(0.21	)		–			(0.21	)		21.63	11.83
2012			17.40		0.19			2.08		2.27		(0.13	)		–			(0.13	)		19.54	13.07
2011			15.83		0.05			1.65		1.70		(0.13	)		–			(0.13	)		17.40	10.81
2010			11.62		0.22			4.23		4.45		(0.24	)		–			(0.24	)		15.83	38.59
Class B shares
2014			21.40		0.01			3.59		3.60		(0.11	)		(2.91	)		(3.02	)		21.98	20.29
2013			19.31		0.11			1.99		2.10		(0.01	)		–			(0.01	)		21.40	10.86
2012			17.23		0.04			2.04		2.08		–			–			–			19.31	12.07
2011			15.72		(0.09	)		1.65		1.56		(0.05	)		–			(0.05	)		17.23	9.94
2010			11.53		0.12			4.19		4.31		(0.12	)		–			(0.12	)		15.72	37.56
Class C shares
2014			21.38		0.03			3.59		3.62		(0.14	)		(2.91	)		(3.05	)		21.95	20.42
2013			19.33		0.12			1.99		2.11		(0.06	)		–			(0.06	)		21.38	10.91
2012			17.24		0.03			2.06		2.09		–			–			–			19.33	12.12
2011			15.74		(0.09	)		1.64		1.55		(0.05	)		–			(0.05	)		17.24	9.90
2010			11.56		0.10			4.23		4.33		(0.15	)		–			(0.15	)		15.74	37.66
Class P shares
2014			21.62		0.24			3.64		3.88		(0.35	)		(2.91	)		(3.26	)		22.24	21.74
2013			19.53		0.36			2.01		2.37		(0.28	)		–			(0.28	)		21.62	12.22
2012			17.40		0.25			2.07		2.32		(0.19	)		–			(0.19	)		19.53	13.38
2011			15.83		0.07			1.70		1.77		(0.20	)		–			(0.20	)		17.40	11.28
2010	(d)		15.38		0.02			0.49		0.51		(0.06	)		–			(0.06	)		15.83	3.34	(e)


								FINANCIAL HIGHLIGHTS
PRINCIPAL FUNDS, INC.


Selected data for a share of Capital Stock outstanding throughout each year ended October 31 (except as noted):
			Net Asset		Net			Net Realized						Dividends			Distributions			Total
			Value,		Investment			and Unrealized			Total From			from Net			from			Dividends			Net Asset
			Beginning		Income			Gain (Loss) on			Investment			Investment			Realized			and			Value, End
			of Period		(Loss)(a)			Investments			Operations			Income			Gains			Distributions			of Period	Total Return(b)
SHORT-TERM INCOME FUND
Class A shares
2014		$	12.27	$	0.18		($	0.03	)	$	0.15		($	0.18	)	($	0.01	)	($	0.19	)	$	12.23	1.20	%
2013			12.28		0.17			(0.02	)		0.15			(0.16	)		–			(0.16	)		12.27	1.19
2012			11.97		0.22			0.30			0.52			(0.21	)		–			(0.21	)		12.28	4.38
2011			12.17		0.27			(0.18	)		0.09			(0.29	)		–			(0.29	)		11.97	0.76
2010			11.84		0.33			0.33			0.66			(0.33	)		–			(0.33	)		12.17	5.64
Class C shares
2014			12.28		0.07			(0.03	)		0.04			(0.07	)		(0.01	)		(0.08	)		12.24	0.30
2013			12.29		0.07			(0.02	)		0.05			(0.06	)		–			(0.06	)		12.28	0.38
2012			11.97		0.12			0.31			0.43			(0.11	)		–			(0.11	)		12.29	3.62
2011			12.18		0.17			(0.19	)		(0.02	)		(0.19	)		–			(0.19	)		11.97	(0.15	)
2010			11.85		0.23			0.32			0.55			(0.22	)		–			(0.22	)		12.18	4.72
Class P shares
2014			12.27		0.20			(0.03	)		0.17			(0.20	)		(0.01	)		(0.21	)		12.23	1.34
2013			12.28		0.19			(0.02	)		0.17			(0.18	)		–			(0.18	)		12.27	1.41
2012			11.96		0.24			0.31			0.55			(0.23	)		–			(0.23	)		12.28	4.64
2011			12.16		0.27			(0.16	)		0.11			(0.31	)		–			(0.31	)		11.96	0.88
2010	(e)		12.13		0.03			0.03			0.06			(0.03	)		–			(0.03	)		12.16	0.45	(f)
SMALLCAP BLEND FUND
Class A shares
2014			21.60		(0.04	)		1.74			1.70			–			(1.56	)		(1.56	)		21.74	8.08
2013			15.50		0.03			6.21			6.24			(0.05	)		(0.09	)		(0.14	)		21.60	40.56
2012			13.76		0.01			1.73			1.74			–			–			–			15.50	12.65
2011			12.99		(0.07	)		0.84			0.77			–			–			–			13.76	5.93
2010			10.47		(0.04	)		2.56			2.52			–			–			–			12.99	24.07
Class B shares
2014			19.95		(0.25	)		1.60			1.35			–			(1.56	)		(1.56	)		19.74	6.92
2013			14.41		(0.12	)		5.75			5.63			–			(0.09	)		(0.09	)		19.95	39.29
2012			12.91		(0.13	)		1.63			1.50			–			–			–			14.41	11.62
2011			12.31		(0.20	)		0.80			0.60			–			–			–			12.91	4.87
2010			10.04		(0.18	)		2.45			2.27			–			–			–			12.31	22.61
Class C shares
2014			20.65		(0.21	)		1.65			1.44			–			(1.56	)		(1.56	)		20.53	7.13
2013			14.89		(0.11	)		5.96			5.85			–			(0.09	)		(0.09	)		20.65	39.51
2012			13.31		(0.09	)		1.67			1.58			–			–			–			14.89	11.87
2011			12.67		(0.18	)		0.82			0.64			–			–			–			13.31	5.05
2010			10.27		(0.12	)		2.52			2.40			–			–			–			12.67	23.37
Class P shares
2014	(h)		22.83		0.01			(0.08	)		(0.07	)		–			–			–			22.76	(0.31	) (f)

Selected data for a share of Capital Stock outstanding throughout each year ended October 31 (except as noted):


			Net Asset		Net			Net Realized					Dividends		Total
			Value,		Investment			and Unrealized			Total From		from Net		Dividends			Net Asset
			Beginning		Income			Gain (Loss) on			Investment		Investment		and			Value, End
			of Period		(Loss)(a)			Investments			Operations		Income		Distributions			of Period	Total Return(b)
SMALLCAP VALUE FUND II
Class A shares
2014	(c)	$	13.75	($	0.03	)	$	0.36		$	0.33		$–		$–		$	14.08	2.40	%(d)
Class P shares
2014	(c)		13.75		–			0.34			0.34		–		–			14.09	2.47	(d)
TAX-EXEMPT BOND FUND
Class A shares
2014			7.00		0.31			0.41			0.72		(0.30	)	(0.30	)		7.42	10.52
2013			7.59		0.31			(0.60	)		(0.29	)	(0.30	)	(0.30	)		7.00	(3.86	)
2012			7.10		0.30			0.49			0.79		(0.30	)	(0.30	)		7.59	11.27
2011			7.24		0.33			(0.14	)		0.19		(0.33	)	(0.33	)		7.10	2.83
2010			6.98		0.35			0.24			0.59		(0.33	)	(0.33	)		7.24	8.66
Class B shares
2014			7.00		0.25			0.41			0.66		(0.24	)	(0.24	)		7.42	9.62
2013			7.58		0.24			(0.58	)		(0.34	)	(0.24	)	(0.24	)		7.00	(4.51	)
2012			7.10		0.24			0.48			0.72		(0.24	)	(0.24	)		7.58	10.22
2011			7.24		0.28			(0.15	)		0.13		(0.27	)	(0.27	)		7.10	2.04
2010			6.98		0.29			0.25			0.54		(0.28	)	(0.28	)		7.24	7.83
Class C shares
2014			7.02		0.25			0.41			0.66		(0.24	)	(0.24	)		7.44	9.59
2013			7.60		0.25			(0.59	)		(0.34	)	(0.24	)	(0.24	)		7.02	(4.50	)
2012			7.12		0.24			0.48			0.72		(0.24	)	(0.24	)		7.60	10.19
2011			7.25		0.27			(0.13	)		0.14		(0.27	)	(0.27	)		7.12	2.17
2010			6.99		0.29			0.25			0.54		(0.28	)	(0.28	)		7.25	7.81

We have audited the accompanying statements of assets and liabilities, including the schedules of investments, of Bond & Mortgage Securities Fund, California Municipal Fund, Diversified International Fund, Equity Income Fund, Global Diversified Income Fund, Global Real Estate Securities Fund, Government & High Quality Bond Fund, High Yield Fund, High Yield Fund I, Income Fund, Inflation Protection Fund, International Emerging Markets Fund, International Fund I, LargeCap Growth Fund, LargeCap Growth Fund I, LargeCap S&P 500 Index Fund, LargeCap Value Fund, MidCap Fund, MidCap Value Fund III, Money Market Fund, Principal Capital Appreciation Fund, Real Estate Securities Fund, Short-Term Income Fund, SmallCap Blend Fund, SmallCap Value Fund II and Tax-Exempt Bond Fund (26 of the portfolios constituting Principal Funds, Inc., collectively, the “Funds”), as of October 31, 2014, and the related statements of operations for the year then ended, statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the periods indicated therein. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Funds’ internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of October 31, 2014, by correspondence with the custodian, agent banks, and brokers or by other appropriate auditing procedures where replies from brokers or agent banks were not received. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of each of the Funds listed above constituting portfolios within Principal Funds, Inc. at October 31, 2014, and the results of their operations for the year then ended, the changes in their net assets for each of the two years in the period then ended, and their financial highlights for each of the periods indicated therein, in conformity with U.S. generally accepted accounting principles.

SHAREHOLDER EXPENSE EXAMPLE
PRINCIPAL FUNDS, INC.
October 31, 2014 (unaudited)

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (May 1, 2014 to October 31, 2014), unless otherwise noted.

The first section of the table below provides information about actual account values and actual expenses. You may use the information in this section, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. An annual fee of $15.00 or $30.00 may apply to IRA accounts and 403(b) accounts, respectively. These fees are not included in the table below. If they were, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount.

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

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges on purchase payments, contingent deferred sales charges, redemption fees or exchange fees. Therefore, the second section of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.


				Actual							Hypothetical
						Expenses Paid							Expenses Paid
		Beginning		Ending		During Period			Beginning		Ending		During Period
		Account		Account Value		May 1, 2014 to			Account		Account Value		May 1, 2014 to		Annualized
		Value May 1,		October 31,		October 31,			Value May 1,		October 31,		October 31,		Expense
		2014		2014		2014	^**		2014		2014		2014	^**	Ratio
Bond & Mortgage Securities Fund
Class A	$	1,000.00	$	1,016.96	$	4.47		$	1,000.00	$	1,020.77	$	4.48		0.88	%
Class B		1,000.00		1,013.20		8.12			1,000.00		1,017.14		8.13		1.60
Class C		1,000.00		1,012.47		8.88			1,000.00		1,016.38		8.89		1.75

California Municipal Fund
Class A		1,000.00		1,051.32		3.93			1,000.00		1,021.37		3.87		0.76
Class B		1,000.00		1,045.72		9.38			1,000.00		1,016.03		9.25		1.82
Class C		1,000.00		1,047.06		8.93			1,000.00		1,016.48		8.79		1.73

California Municipal Fund
(Excluding Interest Expense and Fees)
Class A		1,000.00		1,051.30		3.72			1,000.00		1,021.53		3.68		0.72
Class B		1,000.00		1,045.70		9.18			1,000.00		1,016.12		9.09		1.78
Class C		1,000.00		1,047.10		8.72			1,000.00		1,016.58		8.63		1.69

Diversified International Fund
Class A		1,000.00		994.18		6.53			1,000.00		1,018.65		6.61		1.30
Class B		1,000.00		988.46		12.38			1,000.00		1,012.75		12.53		2.47
Class C		1,000.00		990.02		10.43			1,000.00		1,014.72		10.56		2.08
Class P		1,000.00		995.82		5.18			1,000.00		1,020.01		5.24		1.03

Equity Income Fund
Class A		1,000.00		1,052.39		4.60			1,000.00		1,020.72		4.53		0.89
Class B		1,000.00		1,049.24		7.95			1,000.00		1,017.44		7.83		1.54
Class C		1,000.00		1,048.47		8.47			1,000.00		1,016.94		8.34		1.64
Class P		1,000.00		1,054.28		3.26			1,000.00		1,022.03		3.21		0.63


				SHAREHOLDER EXPENSE EXAMPLE
PRINCIPAL FUNDS, INC.
October 31, 2014 (unaudited)



				Actual							Hypothetical
						Expenses Paid							Expenses Paid
		Beginning		Ending		During Period			Beginning		Ending		During Period
		Account		Account Value		May 1, 2014 to			Account		Account Value		May 1, 2014 to		Annualized
		Value May 1,		October 31,		October 31,			Value May 1,		October 31,		October 31,		Expense
		2014		2014		2014	^**		2014		2014		2014	^**	Ratio
Global Diversified Income Fund
Class A	$	1,000.00	$	1,020.34	$	5.65		$	1,000.00	$	1,019.61	$	5.65		1.11	%
Class C		1,000.00		1,016.63		9.51			1,000.00		1,015.78		9.50		1.87
Class P		1,000.00		1,021.79		4.33			1,000.00		1,020.92		4.33		0.85

Global Diversified Income Fund (Excluding Dividends
and Interest Expense on Shorts and Short Sale Fees)
Class A		1,000.00		1,020.30		4.99			1,000.00		1,020.20		5.00		0.98
Class C		1,000.00		1,016.60		8.84			1,000.00		1,016.32		8.88		1.74
Class P		1,000.00		1,021.80		3.67			1,000.00		1,021.53		3.68		0.72

Global Real Estate Securities Fund
Class A		1,000.00		1,072.92		6.95			1,000.00		1,018.50		6.77		1.33
Class C		1,000.00		1,069.42		11.27			1,000.00		1,014.32		10.97		2.16
Class P		1,000.00		1,073.53		5.59			1,000.00		1,019.81		5.45		1.07

Government & High Quality Bond Fund
Class A		1,000.00		1,019.95		3.87			1,000.00		1,021.37		3.87		0.76
Class B		1,000.00		1,016.32		8.39			1,000.00		1,016.89		8.39		1.65
Class C		1,000.00		1,016.39		8.28			1,000.00		1,016.99		8.29		1.63
Class P		1,000.00		1,020.21		3.56			1,000.00		1,021.68		3.57		0.70

High Yield Fund
Class A		1,000.00		1,007.75		4.81			1,000.00		1,020.42		4.84		0.95
Class B		1,000.00		1,004.05		8.39			1,000.00		1,016.84		8.44		1.66
Class C		1,000.00		1,003.04		8.08			1,000.00		1,017.14		8.13		1.60
Class P		1,000.00		1,009.20		3.34			1,000.00		1,021.88		3.36		0.66

High Yield Fund I
Class A		1,000.00		1,008.20		5.31			1,000.00		1,019.91		5.35		1.05

Income Fund
Class A		1,000.00		1,018.36		4.22			1,000.00		1,021.02		4.23		0.83
Class B		1,000.00		1,012.77		9.64			1,000.00		1,015.63		9.65		1.90
Class C		1,000.00		1,014.04		8.38			1,000.00		1,016.89		8.39		1.65
Class P		1,000.00		1,019.12		3.41			1,000.00		1,021.83		3.41		0.67

Inflation Protection Fund
Class A		1,000.00		1,007.01		4.55			1,000.00		1,020.67		4.58		0.90
Class C		1,000.00		1,003.60		8.33			1,000.00		1,016.89		8.39		1.65

International Emerging Markets Fund
Class A		1,000.00		1,039.48		9.00			1,000.00		1,016.38		8.89		1.75
Class B		1,000.00		1,033.91		14.25			1,000.00		1,011.19		14.09		2.78
Class C		1,000.00		1,034.54		13.49			1,000.00		1,011.95		13.34		2.63
Class P		1,000.00		1,041.51		7.05			1,000.00		1,018.30		6.97		1.37

International Fund I
Class A		1,000.00		994.89		5.94	^*		1,000.00		1,017.90		7.38		1.45
Class P		1,000.00		996.35		4.47	^*		1,000.00		1,019.71		5.55		1.09

LargeCap Growth Fund
Class A		1,000.00		1,118.10		5.50			1,000.00		1,020.01		5.24		1.03
Class B		1,000.00		1,111.70		11.98			1,000.00		1,013.86		11.42		2.25
Class C		1,000.00		1,113.52		10.02			1,000.00		1,015.73		9.55		1.88
Class P		1,000.00		1,118.87		4.33			1,000.00		1,021.12		4.13		0.81

LargeCap Growth Fund I
Class A		1,000.00		1,088.05		6.58			1,000.00		1,018.90		6.36		1.25
Class P		1,000.00		1,061.77		3.30	^*		1,000.00		1,021.27		3.97		0.78

LargeCap S&P 500 Index Fund
Class A		1,000.00		1,079.76		2.52			1,000.00		1,022.79		2.45		0.48
Class C		1,000.00		1,074.81		6.80			1,000.00		1,018.65		6.61		1.30


				SHAREHOLDER EXPENSE EXAMPLE
PRINCIPAL FUNDS, INC.
October 31, 2014 (unaudited)



				Actual							Hypothetical
						Expenses Paid							Expenses Paid
		Beginning		Ending		During Period			Beginning		Ending		During Period
		Account		Account Value		May 1, 2014 to			Account		Account Value		May 1, 2014 to		Annualized
		Value May 1,		October 31,		October 31,			Value May 1,		October 31,		October 31,		Expense
		2014		2014		2014	^**		2014		2014		2014	^**	Ratio
LargeCap Value Fund
Class A	$	1,000.00	$	1,048.27	$	4.39		$	1,000.00	$	1,020.92	$	4.33		0.85	%
Class B		1,000.00		1,042.39		10.30			1,000.00		1,015.12		10.16		2.00
Class C		1,000.00		1,043.81		8.76			1,000.00		1,016.64		8.64		1.70
Class P		1,000.00		1,031.95		2.55	^*		1,000.00		1,022.13		3.11		0.61

MidCap Fund
Class A		1,000.00		1,088.61		5.26			1,000.00		1,020.16		5.09		1.00
Class B		1,000.00		1,083.38		10.45			1,000.00		1,015.17		10.11		1.99
Class C		1,000.00		1,084.73		9.20			1,000.00		1,016.38		8.89		1.75
Class P		1,000.00		1,090.55		3.79			1,000.00		1,021.58		3.67		0.72

MidCap Value Fund III
Class A		1,000.00		1,021.89		5.40	^*		1,000.00		1,018.65		6.61		1.30
Class P		1,000.00		1,023.88		3.45	^*		1,000.00		1,021.02		4.23		0.83

Money Market Fund
Class A		1,000.00		1,000.00		0.81			1,000.00		1,024.40		0.82		0.16
Class B		1,000.00		1,000.00		0.81			1,000.00		1,024.40		0.82		0.16
Class C		1,000.00		1,000.00		0.81			1,000.00		1,024.40		0.82		0.16

Principal Capital Appreciation Fund
Class A		1,000.00		1,069.29		4.17			1,000.00		1,021.17		4.08		0.80
Class B		1,000.00		1,065.39		7.97			1,000.00		1,017.49		7.78		1.53
Class C		1,000.00		1,064.69		8.69			1,000.00		1,016.79		8.49		1.67
Class P		1,000.00		1,070.54		2.97			1,000.00		1,022.33		2.91		0.57

Real Estate Securities Fund
Class A		1,000.00		1,113.50		6.77			1,000.00		1,018.80		6.46		1.27
Class B		1,000.00		1,108.58		11.69			1,000.00		1,014.12		11.17		2.20
Class C		1,000.00		1,109.09		11.00			1,000.00		1,014.77		10.51		2.07
Class P		1,000.00		1,114.81		5.22			1,000.00		1,020.27		4.99		0.98

Short-Term Income Fund
Class A		1,000.00		1,005.70		3.13			1,000.00		1,022.08		3.16		0.62
Class C		1,000.00		1,000.88		7.87			1,000.00		1,017.34		7.93		1.56
Class P		1,000.00		1,006.09		2.73			1,000.00		1,022.48		2.75		0.54

SmallCap Blend Fund
Class A		1,000.00		1,011.16		6.13			1,000.00		1,019.11		6.16		1.21
Class B		1,000.00		1,005.60		11.58			1,000.00		1,013.66		11.62		2.29
Class C		1,000.00		1,006.37		10.52			1,000.00		1,014.72		10.56		2.08
Class P		1,000.00		996.93		3.86	^*		1,000.00		1,020.47		4.79		0.94

SmallCap Value Fund II
Class A		1,000.00		1,024.00		6.03	^*		1,000.00		1,017.90		7.38		1.45
Class P		1,000.00		1,024.73		4.78	^*		1,000.00		1,019.41		5.85		1.15

Tax-Exempt Bond Fund
Class A		1,000.00		1,047.33		3.97			1,000.00		1,021.32		3.92		0.77
Class B		1,000.00		1,042.93		8.24			1,000.00		1,017.14		8.13		1.60
Class C		1,000.00		1,042.80		8.24			1,000.00		1,017.14		8.13		1.60

Tax-Exempt Bond Fund
(Excluding Interest Expense and Fees)
Class A		1,000.00		1,047.30		3.82			1,000.00		1,021.43		3.78		0.74
Class B		1,000.00		1,042.90		8.08			1,000.00		1,017.19		8.01		1.57
Class C		1,000.00		1,042.80		8.08			1,000.00		1,017.19		8.01		1.57

^**Expenses are equal to a fund's annualized expense ratio multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).

^*Expenses are equal to a fund's annualized expense ratio multiplied by the average account value over the period (June 3, 2014 to October 31, 2014), multiplied by 184/365 (to reflect the period since inception).

Under Maryland law, a Board of Directors oversees the Fund. The Directors have financial or other relevant experience and meet several times during the year to review contracts, Fund activities and the quality of services provided to the Fund. Each director also has the same position with Principal Variable Contracts Funds, Inc. which is also sponsored by Principal Life Insurance Company. Each director holds office for an indefinite term or until reaching age 72. Directors considered to be “interested persons” as defined in the Investment Company Act of 1940, as amended, as shown below are considered to be interested because of an affiliation with the Manager and Principal Life Insurance Company.

The following directors are considered not to be “interested persons” as defined in the 1940 Act


		Number of	Other
Name,		Portfolios in Fund	Directorships
Position Held with the Fund,	Principal Occupation(s)	Complex Overseen by	Held by Director
Year of Birth	During past 5 years	Director	During Past 5 Years
Elizabeth Ballantine	Principal, EBA Associates	117	Durango Herald, Inc;
Director since 2004			McClatchy
Member, Nominating and Governance			Newspapers, Inc.
Committee
1948

Leroy T. Barnes, Jr.	Retired.	117	McClatchy
Director since March 2012			Newspapers, Inc.;
Member, Audit Committee			Herbalife Ltd.; Frontier
1951			Communications, Inc.;
			Longs Drug Stores

Craig Damos	President, The Damos	117	Hardin Construction
Director since 2008	Company. Formerly, CEO, The		Company
Member, Audit Committee	Weitz Company
Member, 15(c) Committee
1954

Mark A. Grimmett	Executive Vice President and	117	None
Director since 2004	CFO, Merle Norman Cosmetics,
Member, Nominating and Governance	Inc.
Committee
Member, 15(c) Committee
Member, Executive Committee
1960

Fritz S. Hirsch	CEO, MAM USA	117	Focus Products Group
Director since 2005	Formerly, President, Sassy, Inc.
Member, Operations Committee
Member, 15(c) Committee
1951

Tao Huang	Formerly, Chief Operating	117	Armstrong World
Director since March 2012	Officer, Morningstar, Inc.		Industries, Inc.
Member, Operations Committee
Member, 15(c) Committee
1962

William C. Kimball	Partner, Kimball – Porter	117	Casey’s General Stores,
Director since 1999	Investments L.L.C.		Inc.
Member, Nominating and Governance
Committee
1947

Karen (“Karrie”) McMillan	Formerly, General Counsel,	117	None
Director since September 2014	Investment Company Institute
Member, Operations Committee
1961

Daniel Pavelich	Retired.	117	None
Director since 2007
Member, Audit Committee
Member, 15(c) Committee
1944

The following directors are considered to be “interested persons” as defined in the 1940 Act, as amended, because of an affiliation with the Manager and Principal Life.


		Number of
		Portfolios in Fund	Other
Name,		Complex	Directorships
Position Held with the Fund,	Principal Occupation(s)	Overseen by	Held by Director
Year of Birth	During past 5 years	Director	During Past 5 Years
Michael J. Beer	Executive Vice President, Principal	117	None
Director since 2012	Funds Distributor, Inc. (“PFD”)
Executive Vice President	Vice President/Mutual Funds and
Member, Executive Committee	Broker Dealer, Principal Life
1961	Insurance Company (“PLIC”)
	Director, Principal Management
	Corporation, (the “Manager”)
	Executive Vice President/ Chief
	Operating Officer, the Manager
	Director, Princor
	President, Princor
	Director, Principal Shareholder
	Services (“PSS”) since 2011
	President, PSS since 2011

Nora M. Everett	Director, Edge (2008-2011)	117	None
Director since 2008	Director, Finisterre since 2011
President, CEO, and Chairman	Chairman, Principal Financial
Member, Executive Committee	Advisors, Inc. (“PFA”) since 2010
1959	Chairman, PFD since 2011
	Senior Vice President/Retirement and
	Investor Services, PLIC
	Chairman, the Manager since 2011
	President, the Manager since 2008
	Chairman, Princor since 2011
	Chief Executive Officer, Princor since
	2009
	Chairman, PSS since 2011

Correspondence intended for each Director who is other than an Interested Director may be sent to 711 High Street, Des Moines, IA

Name, Position Held with the Fund, Address, and Year of Birth

Randy L. Bergstrom Assistant Tax Counsel

711 High Street, Des Moines, IA 50392 1955

David J. Brown

Chief Compliance Officer

711 High Street, Des Moines, IA 50392 1960

Principal Occupation(s) During past 5 years

Counsel, Principal Global Investors, LLC (“PGI”) Counsel, PLIC

Senior Vice President, PFD

Vice President/Compliance, PLIC

Senior Vice President, the Manager Senior Vice President, Princor Senior Vice President, PSS

Teresa M. Button Treasurer

711 High Street, Des Moines, IA 50392 1963

Vice President/Treasurer, Edge since 2011 Vice President/Treasurer, PFA since 2011

Vice President/Treasurer, PFD since 2011 Vice President/Treasurer, PGI since 2011 Vice President/Treasurer, PLIC since 2011 Vice President/Treasurer, the Manager since 2011 Vice President/Treasurer, Post since 2011 Vice President/Treasurer, Principal-REI since 2011 Vice President/Treasurer, Princor since 2011 Vice President/Treasurer, PSS since 2011 Treasurer, Spectrum since 2011

Ernie H. Gillum

Vice President, Assistant Secretary 711 High Street, Des Moines, IA 50392 1955

Carolyn F. Kolks Assistant Tax Counsel

711 High Street, Des Moines, IA 50392 1962

Jennifer A. Mills Assistant Counsel

711 High Street, Des Moines, IA 50392 1973

Vice President/Chief Compliance Officer, the Manager

Vice President/Chief Compliance Officer, PSS

Counsel, PGI Counsel, PLIC

Counsel, PFD (2009-2013) Counsel, PLIC

Counsel, the Manager (2009-2013) Counsel, Princor (2009-2013) Counsel, PSS (2009-2013)

Layne A. Rasmussen

Vice President, Controller, and CFO 711 High Street, Des Moines, IA 50392 1958

Michael D. Roughton Counsel

711 High Street, Des Moines, IA 50392 1951

Vice President/Controller – Principal Funds, the Manager

Senior Vice President/Counsel, PFA Senior Vice President/Counsel, PFD

Vice President & Associate General Counsel, PLIC Senior Vice President/Counsel, the Manager Senior Vice President/Counsel, Princor (2009-2013) Senior Vice President/Counsel, PSS

Britney L. Schnathorst

Assistant Counsel 1981

Counsel, PLIC since 2013

Prior thereto, Attorney in Private Practice

Name, Position Held with the Fund, Address, and Year of Birth

Adam U. Shaikh Assistant Counsel

711 High Street, Des Moines, IA 50392 1972

Principal Occupation(s) During past 5 years

Counsel, PFD (2006-2013) Counsel, PLIC

Counsel, the Manager (2007-2013) Counsel, Princor (2007-2013) Counsel, PSS (2007-2013)

Dan Westholm Assistant Treasurer

711 High Street, Des Moines, IA 50392 1966

Assistant Vice President/Treasury, PFA since 2013 Director – Treasury, PFA (2011-2013)

Assistant Vice President/Treasury, PFD since 2013 Director – Treasury, PFD (2011-2013) Assistant Vice President/Treasury, PLIC

Assistant Vice President/Treasury, the Manager Assistant Vice President/Treasury, Princor since 2013 Director – Treasury, Princor (2008-2009, 2011-2013) Assistant Vice President/Treasury, PSS

Beth Wilson

Vice President and Secretary

711 High Street, Des Moines, IA 50392 1956

Vice President, the Manager (2007-2013)

Vice President, Princor (2007-2009)

The 15(c) Committee assists the Board in performing the annual review of the Fund’s advisory and sub-advisory agreements pursuant to Section 15(c) of the 1940 Act.

The Audit Committee selects the independent auditors for the Fund and oversees the activities of the independent auditors as well as the internal auditors. The committee also receives reports about accounting and financial matters affecting the Fund.

The Executive Committee is selected by the Board. It may exercise all the powers of the Board, with certain exceptions, when the Board is not in session. The Committee must report its actions to the Board.

The Nominating and Governance Committee selects and nominates all candidates who are not “interested persons” of the Fund for election to the Board. The committee also oversees the structure and efficiency of the Board of Directors and the committees the Board establishes.

The Operations Committee oversees the provision of administrative and distribution services to the Funds, communications with the Funds’ shareholders, and provides review and oversight of the Funds’ operations.

Additional information about the Fund is available in the Prospectuses dated March 1, 2014, and the Statement of Additional Information dated March 1, 2014. These documents may be obtained free of charge by writing or telephoning Principal Funds Distributor, Inc., P.O. Box 10423, Des Moines, IA 50306. Telephone 1-800-222-5852.

A description of the policies and procedures the Fund uses to determine how to vote proxies relating to portfolio securities and the results of the proxy votes for the most recent twelve months ended June 30 may be obtained free of charge by telephoning Principal Funds Distributor, Inc., at 1-800-222-5852, or at www.sec.gov.

The Fund files complete schedules of investments with the Securities and Exchange Commission as of January 31 and July 31 of each year on Form N-Q. The Fund’s Form N-Q can be reviewed and copied at the Commission’s Public Reference Room in Washington, D.C. or on the Commission’s website at www.sec.gov. Information on the operation of the Public Reference Room may be obtained by calling the Commission at 1-800-SEC-0330.

During the period covered by this report, the Board of Directors of Principal Funds, Inc. (“PFI”) approved (1) the annual review and renewal of the Management Agreement and various subadvisory agreements for all Funds; and (2) an Amended & Restated Management Agreement with Principal Management Corporation related to the Principal LifeTime Hybrid Income Fund, Principal LifeTime Hybrid 2015 Fund, Principal LifeTime Hybrid 2020 Fund, Principal LifeTime Hybrid 2025 Fund, Principal LifeTime Hybrid 2030 Fund, Principal LifeTime Hybrid 2035 Fund, Principal LifeTime Hybrid 2040 Fund, Principal LifeTime Hybrid 2045 Fund, Principal LifeTime Hybrid 2050 Fund, Principal LifeTime Hybrid 2055 Fund and Principal LifeTime Hybrid 2060 Fund.

Annual Review and Renewal of Management Agreement and Subadvisory Agreements

At its September 9, 2014 meeting, the Board performed its annual review and renewal process relating to the Management Agreement and the Subadvisory Agreements for all Funds.

Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”) requires the Board, including a majority of the Directors who have no direct or indirect interest in the investment advisory agreements and who are not “interested persons” of PFI, as defined in the 1940 Act (the “Independent Directors”), annually to review and to consider the continuation of: (1) the Management Agreement between Principal Management Corporation (the “Manager”) and PFI, on behalf of each of the sixty-five (65) series of PFI (each series is referred to as a “Fund”) (2) the Subadvisory Agreements between the Manager and each of AllianceBernstein L.P.; American Century Investment Management, Inc.; Barrow Hanley Mewhinney & Strauss, LLC; BlackRock Financial Management, Inc.; Brown Advisory LLC; Causeway Capital Management LLC.; Clearbridge Investments, LLC; Colonial First State Asset Management (Australia) Limited; Columbus Circle Investors (“Columbus Circle”); DDJ Capital Management, LLC; Dimensional Fund Advisors LP; Edge Asset Management Inc. (“Edge”); Emerald Advisers, Inc.; Goldman Sachs Asset Management, L.P.; Guggenheim Partners Investment Management, LLC; J.P. Morgan Investment Management, Inc.; Los Angeles Capital Management and Equity Research, Inc.; Montag & Caldwell, LLC; Neuberger Berman Fixed Income LLC; Pacific Investment Management Company LLC; Post Advisory Group, LLC (“Post”); Principal Global Investors, LLC (“PGI”); Principal Real Estate Investors, LLC (“Principal-REI”); Robert W. Baird & Co. Incorporated; Spectrum Asset Management, Inc. (“Spectrum”); Stone Harbor Investment Partners LP; T. Rowe Price Associates, Inc.; Tortoise Capital Advisors, LLC; Vaughan Nelson Investment Management, LP; W. H. Reaves & Co., Inc.; Westwood Management Corp.; and William Blair & Company, L.L.C.; (collectively, the “Subadvisors”). The Management Agreement and the Subadvisory Agreements are collectively referred to as the “Advisory Agreements.”

The Board, including the Independent Directors, considered the factors and reached the conclusions described below relating to the continuation of the Advisory Agreements. In evaluating the Advisory Agreements, the Board, including the Independent Directors, reviewed a broad range of information requested for this purpose by the Independent Directors, including, among other information, information regarding performance, advisory fees, total expenses, profitability from the Advisory Agreements to the Manager and information about economies of scale. The Board reviewed the materials provided and concluded that it was provided all information reasonably necessary to evaluate the Advisory Agreements.

The Board considered the nature, quality and extent of services provided under the Management Agreement. The Board considered the experience and skills of senior management leading fund operations, the experience and skills of the personnel performing the functions under the Management Agreement and the resources made available to such personnel, the ability of the Manager to attract and retain high-quality personnel, and the organizational depth and stability of the Manager. The Board concluded that appropriate resources were provided under the Management Agreement. The Board also considered that, during the periods reviewed, other than for the “Core” portions of the Funds implementing the “Core Satellite” structure and all PFI Funds-of-Funds (except the SAM Portfolios), the Manager had delegated day-to-day portfolio management responsibility to the Subadvisors, and it considered the due diligence program developed by the Manager for identifying, recommending, monitoring and replacing Subadvisors. The Board noted that the Manager applies the due diligence standards to the selection, monitoring and replacement of subadvisors and the Manager proposes the selection of the most suitable subadvisors, with a process that emphasizes Principal affiliated subadvisors, subject to the due diligence standards. The Board also took note that the Manager applied the due diligence standards to its personnel’s management of the “Core” portfolio. The Board concluded that this due diligence process was working well. The Board also considered the compliance program established by the Manager and the level of compliance attained by the Funds. The Board noted that it had previously reviewed the annual best execution and soft dollar reports and found no issues that affected its consideration of the renewal of the Advisory Agreements. Based upon all relevant factors, the Board concluded that the nature, quality and extent of the services provided by the Manager to the Funds under the Management Agreement were satisfactory.

The Board considered the nature, quality and extent of services provided under each Subadvisory Agreement. The Board considered the reputation, qualifications and background of the Subadvisor, investment approach of the Subadvisor, the experience and skills of investment personnel responsible for the day-to-day management of each Fund, and the resources made available to such personnel. The Board also considered the Subadvisors’ compliance with investment policies and general legal compliance. In addition, the Board considered the analysis provided under the Manager’s due diligence program, which resulted in the Manager recommending that each Subadvisory Agreement be continued. Based upon all relevant factors, the Board concluded that the nature, quality and extent of the services provided by the Subadvisors to the Funds under the Subadvisory Agreements are satisfactory.

The Board reviewed each Fund’s investment performance over longer-term periods (reviewing both the investment return during the three-year period and the blended investment return (50%/50%) of the three- and five-year periods), and compared those returns to various agreed-upon performance measures, including peer group data based upon a broad-based, industry category determined by Morningstar. For Funds or Subadvisors that did not have a three-year or five-year history, the Board reviewed performance for a one-year or three-year period, respectively, noting that certain funds had commenced operations recently and, accordingly, no performance information was considered. The Board also considered whether investment results were consistent with a Fund’s investment objective(s) and policies. For most Funds, the Board concluded that the Fund’s investment returns met acceptable levels of investment performance. There were some Funds, or certain Subadvisors for a multi-manager Fund, that had not attained during the relevant period a level of investment performance considered satisfactory by the Board. For such Funds, the Board also considered other factors, such as the longer-term performance of each such Fund. The Board concluded that the Manager has in place an effective due diligence process to monitor investment performance, to encourage remedial action and to make changes in the Subadvisor at the appropriate time, if necessary.

The Board considered each Fund’s management fees. The Board received information, based on data supplied by Lipper, comparing each Fund’s contractual management fee (at current asset levels and at theoretical asset levels), actual (after any fee waivers) management fee (at average fiscal year asset levels), actual non-management fees (at average fiscal year asset levels) and actual total expense ratio (at average fiscal year asset levels for Class A shares where available) to advisory fees and expense ratios of mutual funds in a narrow peer group selected by Lipper, or for two Funds, a custom peer group recommended by the Manager and reviewed by the Board (“Expense Group”) and a broad-based, industry category defined by Lipper (“Expense Universe”). For Funds that did not offer Class A shares or if Class A shares represented less than 5% of the Fund’s total assets, the information provided was based upon Institutional Class shares.

In evaluating the management fees, the Board considered a variety of factors, including the amount of the fees, breakpoints, comparison to fees of peer group funds and other funds managed by the Manager, subadvisory fees paid, services provided, investment performance, total net expense ratios, profitability and expense caps and fee waivers. The Board considered that certain Funds have different management fees from certain other comparable funds managed by the Manager and noted the reasons cited by the Manager for the differing fees. For most Funds, actual management fees were within the 3rd Quartile or better when compared to their Expense Group. For some Funds, although actual management fees were higher than the 3rd Quartile, total net expense ratios were within the 3rd Quartile or better.

For the SAM Portfolios, with the exception of the SAM Conservative Balanced Portfolio, the Board considered information from management about the Manager’s active asset allocation strategy and determined that the strategy and processes justified higher management fees than the Funds’ peer groups and that the total expense ratios (including the expenses of the underlying funds), with the continuation of the expense cap suggested by management, were within an acceptable range or compare favorably. With specific regard to the SAM Conservative Balanced Portfolio, although actual management fees and the total net expense ratio on the basis of Class A shares are higher than 3rd Quartile (99% and 80%, respectively) for the Expense Group, the Board concluded that the Management Agreement should be renewed, based upon all relevant factors, including that the Fund’s performance is in the 1st Quartile for each of the three-year and blended three- and five-year periods.

The Board also considered that the Manager contractually agreed to continue to waive a portion of its management fee for ten Funds that have implemented the “Core Satellite” structure. The Board also took into consideration the additional breakpoints in the fee schedule for two Funds proposed by management.

In the Board’ review of the expense caps in place with respect to certain classes of a number of Funds, the Board considered the Manager’s proposals to extend the expense caps in place for most of such classes for an additional year and to let the expense caps for classes of certain Funds expire, based upon the individual circumstances of these Funds.

Considering all factors it deemed relevant, the Board concluded that the management fee schedule for each Fund was reasonable and appropriate in light of the nature and quality of services provided by the Manager and other relevant factors.

The Board reviewed detailed information regarding revenues the Manager receives under the Management Agreement, as well as the estimated direct and indirect costs the Manager incurs in providing to each Fund the services described in the applicable Advisory Agreements, for the year ended December 31, 2013. The Board also considered the returns on revenue generated in connection with the payment of subadvisory fees to affiliated Subadvisors (PGI, Principal-REI, Edge, Columbus Circle, Post, and Spectrum). The Board concluded that the management fee for each Fund was reasonable, taking into account the profitability percentages the Manager provided.

The Board considered whether there are economies of scale with respect to the management of each Fund and whether the Funds benefit from any such economies of scale through breakpoints in fees. The Board also noted the additional breakpoints offered by management for two Funds. The Board then reviewed the levels at which breakpoints occur and the amount of the reductions. The Board considered whether the effective management fee rate for each Fund under the applicable Management Agreement is reasonable in relation to the asset size of such Fund. The Board concluded that the fee schedule for each Fund reflects an appropriate level of sharing of any economies of scale.

The Board noted that the management fees for the LargeCap S&P 500 Index Fund, MidCap S&P 400 Index Fund, SmallCap S&P 600 Index Fund and the LifeTime Funds series do not include breakpoints. Although their management fee schedules do not contain breakpoints, the Board noted that each of these Funds has a relatively low basis point fee (25 basis points or less) on all Fund assets.

For each Fund the Board considered the subadvisory fees, noting that the Manager compensates each Subadvisor from its own management fee, so that shareholders pay only the management fee. The Board also received industry data supplied by Lipper. The Board considered whether there are economies of scale with respect to the subadvisory services provided to each Fund and, if so, whether the subadvisory fees reflect such economies of scale through breakpoints in fees. In addition, in evaluating the subadvisory fees and the factor of profitability, with respect to unaffiliated Subadvisors, the Board considered that the subadvisory fee rate was negotiated at arm’s-length between the Manager and each Subadvisor. The Board considered the profitability of the affiliated Subadvisors in conjunction with its review of the profitability of the Manager.

The Board also considered the character and amount of other incidental benefits received by the Manager and its affiliates and each Subadvisor from their relationships with the Funds. The Board also considered as a part of this analysis each Subadvisor’s soft dollar practices and brokerage practices. The Board concluded that management and subadvisory fees for each Fund were reasonable in light of these benefits.

Based upon all of the information it considered and the conclusions it reached, the Board determined unanimously that the terms of each Advisory Agreement continue to be fair and reasonable and that the continuation of each Advisory Agreement, with the actions proposed by the Manager, is in the best interests of each Fund.

On June 10, 2014, the Board considered, on behalf of the newly established Principal LifeTime Hybrid Income Fund, Principal LifeTime Hybrid 2015 Fund, Principal LifeTime Hybrid 2020 Fund, Principal LifeTime Hybrid 2025 Fund, Principal LifeTime Hybrid 2030 Fund, Principal LifeTime Hybrid 2035 Fund, Principal LifeTime Hybrid 2040 Fund, Principal LifeTime Hybrid 2045 Fund, Principal LifeTime Hybrid 2050 Fund, Principal LifeTime Hybrid 2055 Fund and Principal LifeTime Hybrid 2060 Fund (each, a “Fund” and together, the “Funds”), the approval of the management agreement (“Management Agreement”) between PFI, for each Fund, and the Manager.

With respect to the Management Agreement, the Board considered, among other factors, that the Manager has had a long-term relationship with PFI and has demonstrated a commitment to support PFI. The Board concluded that a long-term relationship with a capable, conscientious adviser is in the best interests of each Fund. The Board considered various factors, including the following, and made certain findings and conclusions with regard thereto, in approving the Management Agreement.

The Board considered the nature, quality and extent of services to be provided under the Management Agreement, including administrative services. The Board noted that, in connection with the 2013 annual renewal of the Management Agreements for the other PFI Funds, the Board had: (1) reviewed the services provided by the Manager to the other PFI Funds under the Management Agreements; (2) considered the experience and skills of senior management leading fund operations, the experience and skills of the personnel performing the functions under the Management Agreements and the resources made available to such personnel, the ability of the Manager to attract and retain high-quality personnel, and the organizational depth and stability of the Manager and concluded that appropriate resources were provided under the Management Agreements for the PFI Funds; (3) considered the program developed by the Manager for identifying, recommending, monitoring and replacing subadvisors for the PFI Funds and concluded that this due diligence process was working well; and (4) considered the compliance program established by the Manager and the level of compliance attained by the PFI Funds. Based upon all relevant factors, the Board concluded that the nature, quality and extent of the services the Manager is expected to provide to each Fund under the Management Agreement are satisfactory.

As each Fund is a newly created series, the Board did not review performance of the Funds since no track record was available. However, the Board reviewed the historical performance rankings as of March 31, 2014 of collective investment trusts using the same investment process as will be used for the Funds for which the Funds’ proposed portfolio managers provide non-discretionary advice, as compared to the relevant Morningstar category for one-year, three-year and since August 1, 2009 periods. The Board concluded, based on this information, that the historical investment performance record of the Manager was satisfactory.

The Board considered each Fund’s proposed management fee. The Board received information from the Manager, based on data supplied by Lipper, comparing the proposed management fees to advisory fees of funds with similar investment objectives. The Board also considered whether there are economies of scale with respect to the services to be provided to the Funds under the Management Agreement. The Board noted that, although each Fund’s proposed management fee schedule does not contain breakpoints, each Fund has a relatively low basis point fee for all Fund assets.

In addition, in evaluating the management fees, the Board considered the estimated profitability of the Funds to the Manager. The Board reviewed the anticipated expense ratio of each class of each Fund and considered that the Manager proposed to cap the total expense ratios for the classes at certain levels through February 28, 2016. On the basis of the information provided, the Board concluded that the proposed management fee for each Fund is reasonable.

The Board also considered the character and amount of other incidental benefits to be received by the Manager. The Board concluded that taking into account these potential benefits, the proposed management fee for each Fund is reasonable.

Based upon all of the information considered and the conclusions reached, the Board determined that the terms of the Management Agreement are fair and reasonable and that approval of the Management Agreement is in the best interests of each Fund.

Long Term Capital Gain Dividends. Certain of the Funds distributed long term capital gain dividends during the fiscal year ended October 31, 2014. Details of designated long term capital gain dividends for federal income tax purposes are shown in the notes to financial statements.

Dividend Received Deduction. For corporate shareholders, the percentage of ordinary income distributions (dividend income and short-term gains, if any) for the year ended October 31, 2014, that qualifies for the dividend received deduction is as follows:

Qualified Dividend Income. Certain dividends paid by the Funds may be subject to a maximum tax rate of 15%, as provided for by the Jobs and Growth Tax

Relief Reconciliation Act of 2003. The percentage of ordinary income distributions for the fiscal year ended October 31, 2014, taxed at a maximum rate of 15% is as follows:

Foreign Taxes Paid. The following Funds elect under the Internal Revenue Code Section 853 to pass through foreign taxes paid by each Fund to its shareholders. The total amount of foreign taxes passed through to shareholders on a per share basis for the year ended October 31, 2014, are as follows:

This information is given to meet certain requirements of the Internal Revenue Code and should not be used by shareholders for preparing their income tax returns.

For tax return preparation purposes, please refer to the information supplied with the 1099-DIV form you will receive from the Fund’s transfer agent.

Principal Funds Distributor, Inc.
711 High Street
Des Moines, IA 50392-6370

Do not use this address for business correspondence.

GLOBAL INVESTMENT MANAGEMENT • ASSET ALLOCATION EXPERTISE • RETIREMENT LEADERSHIP

A mutual fund’s share price and investment return will vary with market conditions, and the principal value of an investment when you sell your shares may be more or less than the original cost.

This annual report is published as general information for the shareholders of Principal Funds. This material is not authorized for distribution unless preceded or accompanied by a current prospectus that includes more information regarding the risk factors, expenses, policies, and objectives of the funds. Investors should read the prospectus carefully before investing.

To obtain an additional prospectus, please contact your financial professional or call 800-222-5852.

Principal Funds, Inc. is distributed by Principal Funds Distributor, Inc., 800-222-5852, member of the Principal Financial Group^®.

Principal Funds Distributor, Principal Shareholder Services, Principal Management Corporation and its affiliates, and Principal Funds, Inc. are collectively referred to as Principal Funds.

Note: if your shares are not held directly with Principal Funds
but through a brokerage firm, please contact your broker for
electronic delivery options available.

GLOBAL INVESTMENT MANAGEMENT •ASSET ALLOCATION EXPERTISE •RETIREMENT LEADERSHIP

Whatever your financial goals, we have a wide range of mutual funds to help you succeed.

⁴Asset allocation and diversification do not ensure a profit or protect against a loss. Past performance does not guarantee future results.

One interesting side effect of this is the divergence between unemployment and the level of inflation. While inflation has

Portfolio Managers:

Principal Global Investors, LLC
Principal Management Corp.

What contributed to or detracted from Fund performance during the fiscal year?

The Principal LifeTime Funds invest wholly in the Institutional Class shares of the underlying funds. Any specific performance comparisons of the underlying funds correspond to that share class.

Exposure to the high yield asset class contributed to results as the High Yield Fund I (co-sub-advised by JP Morgan and Neuberger Berman) beat the returns of the broad Barclays Capital Aggregate Bond Index. Within the global/non U.S. equity asset class, both the Diversified International Fund (sub-advised by Principal Global Investors) and the Overseas Fund (co-sub-advised by Barrow, Hanley, Mewhinney & Strauss and Causeway Capital) contributed to returns, as both funds beat the returns of their respective benchmarks. Finally, exposure to the Global Opportunities Fund (sub-advised by Principal Global Investors) contributed to returns as it delivered results that beat multiple broad indexes including the MSCI EAFE Index and the Barclays Capital Aggregate Bond Index. Within the fixed income space, exposure to the Core Plus Bond Fund I (sub-advised by PIMCO) detracted from returns as it lagged the broad Barclays Capital Aggregate Bond Index. Within the U.S. equity asset class, exposure to the LargeCap Growth Fund I (co-sub-advised by T. Rowe Price and Brown Advisory) detracted from returns as it significantly lagged the returns of its index. In addition, the overweight to the global/non-U.S. equity asset class detracted because the returns of the asset class lagged the overall market return by a significant margin.

A sales charge may apply as follows: Class A shares: maximum up-front sales charge of 3.75%. See the prospectus for details. Performance listed with sales charge reflects the maximum sales charge.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses. Expense limits apply through 2/28/15. Gross and net expense ratios reflect the total annual fund operating expenses of the investment option and its underlying funds. Returns are based on net total investment expense.

invest directly in an index. The Fund’s primary benchmark changed from Barclays U.S. Aggregate Bond Index to the S&P Target Date 2010 Index because the S&P Target Date Indexes are more widely used and recognized in the industry.

Portfolio Managers:

Principal Global Investors, LLC
Principal Management Corp.

What contributed to or detracted from Fund performance during the fiscal year?

The Principal LifeTime Funds invest wholly in the Institutional Class shares of the underlying funds. Any specific performance comparisons of the underlying funds correspond to that share class.

invest directly in an index. The Fund's primary benchmark changed from Russell 3000® Index to the S&P Target Date 2020 Index because the S&P Target Date Indexes are more widely used and recognized in the industry.

Portfolio Managers:

Principal Global Investors, LLC
Principal Management Corp.

What contributed to or detracted from Fund performance during the fiscal year?

The Principal LifeTime Funds invest wholly in the Institutional Class shares of the underlying funds. Any specific performance comparisons of the underlying funds correspond to that share class.

invest directly in an index. The Fund's primary benchmark changed from Russell 3000® Index to the S&P Target Date 2030 Index because the S&P Target Date Indexes are more widely used and recognized in the industry.

Portfolio Managers:

Principal Global Investors, LLC
Principal Management Corp.

What contributed to or detracted from Fund performance during the fiscal year?

The Principal LifeTime Funds invest wholly in the Institutional Class shares of the underlying funds. Any specific performance comparisons of the underlying funds correspond to that share class.

Portfolio Managers:

Principal Global Investors, LLC
Principal Management Corp.

What contributed to or detracted from Fund performance during the fiscal year?

The Principal LifeTime Funds invest wholly in the Institutional Class shares of the underlying funds. Any specific performance comparisons of the underlying funds correspond to that share class.

Portfolio Managers:

Principal Global Investors, LLC
Principal Management Corp.

What contributed to or detracted from Fund performance during the fiscal year?

The Principal LifeTime Funds invest wholly in the Institutional Class shares of the underlying funds. Any specific performance comparisons of the underlying funds correspond to that share class.

Exposure to the high yield asset class contributed to results as the High Yield Fund I (co-sub-advised by JP Morgan and Neuberger Berman) beat the returns of the broad Barclays Capital Aggregate Bond Index. Within the global/non U.S. equity asset class, both the Diversified International Fund (sub-advised by Principal Global Investors) and the Overseas Fund (co-sub-advised by Barrow, Hanley, Mewhinney & Strauss and Causeway Capital) contributed to returns, as both funds beat the returns of their respective benchmarks. Finally, exposure to the Global Opportunities Fund (sub-advised by Principal Global Investors) contributed to returns as it delivered results that beat multiple broad indexes including the MSCI EAFE Index and the Barclays Capital Aggregate Bond Index. Within the fixed income space, exposure to the Core Plus Bond Fund I (sub-advised by PIMCO) detracted from returns as it lagged the broad Barclays Capital Aggregate Bond Index. Within the U.S. equity asset class, exposure to the LargeCap Growth Fund I (co-sub-advised by T. Rowe Price and Brown Advisory) detracted from returns as it significantly lagged the returns of its index. In addition, the underweight to the U.S. equity asset class also detracted, as the performance of this asset class was the best in the index.

What contributed to or detracted from Portfolio performance during the fiscal year?

The Principal Strategic Asset Management (SAM) Portfolios invest wholly in the Institutional Class shares of the underlying funds. Any specific performance comparisons of the underlying funds correspond to that share class.

Strategic and tactical underweight to international developed market equities aided performance as developed market equities underperformed U.S. securities. Security selection in international developed market growth equity securities also aided performance. Tactical overweight to equity versus fixed income contributed to performance. Strategic allocation to emerging market stocks detracted from performance, as those holdings lagged U.S. issues. Security selection in mid cap value also hindered performance. In addition, security selection within large cap value detracted from performance.

A sales charge may apply as follows: Class A shares: maximum up-front sales charge of 5.50%; Class B shares: contingent deferred sales charge of 5%, which will decline over 5 years (5-5-4-3-2-0%); Class C shares: contingent deferred sales charge of 1% on redemptions made during the first 12 months. See the prospectus for details. Performance listed with sales charge reflects the maximum sales charge.

* Performance assumes reinvestment of all dividends and capital gains. Performance does not reflect the impact of federal, state, or municipal taxes. If it did, performance would be lower.

invest directly in an index. The SAM Balanced Blended Index is composed of 45% Russell 3000 Index, 40% Barclays Aggregate Bond Index, and 15% MSCI EAFE Index.

What contributed to or detracted from Portfolio performance during the fiscal year?

Strategic and tactical underweight to international developed market equities aided performance as developed market equities underperformed U.S. securities. Tactical overweight to equity versus fixed income also contributed to performance. The Portfolio was aided by security selection in international developed market growth equity securities. Strategic allocation to emerging market stocks detracted from performance, as those holdings lagged U.S. issues. The Portfolio's security selection in mid cap value also hindered performance. Strategic allocation to international bonds hindered performance.

A sales charge may apply as follows: Class A shares: maximum up-front sales charge of 5.50%; Class B shares: contingent deferred sales charge of 5%, which will decline over 5 years (5-5-4-3-2-0%); Class C shares: contingent deferred sales charge of 1% on redemptions made during the first 12 months. See the prospectus for details. Performance listed with sales charge reflects the maximum sales charge.

* Performance assumes reinvestment of all dividends and capital gains. Performance does not reflect the impact of federal, state, or municipal taxes. If it did, performance would be lower.

invest directly in an index. The SAM Conservative Balanced Blended Index is composed of 60% Barclays Aggregate Bond Index, 30% Russell 3000 Index, and 10% MSCI EAFE Index.

What contributed to or detracted from Portfolio performance during the fiscal year?

Security selection in international developed market growth securities contributed to performance. Strategic and tactical underweight to international developed market equities also aided performance as developed market equities underperformed U.S. securities. Tactical overweight to equity versus fixed income contributed to performance. Strategic allocation to emerging market stocks detracted from performance, as those holdings lagged U.S. issues. Security selection in mid cap value also hindered performance. In addition, security selection within large cap value detracted from performance.

A sales charge may apply as follows: Class A shares: maximum up-front sales charge of 5.50%; Class B shares: contingent deferred sales charge of 5%, which will decline over 5 years (5-5-4-3-2-0%); Class C shares: contingent deferred sales charge of 1% on redemptions made during the first 12 months. See the prospectus for details. Performance listed with sales charge reflects the maximum sales charge.

* Performance assumes reinvestment of all dividends and capital gains. Performance does not reflect the impact of federal, state, or municipal taxes. If it did, performance would be lower.

invest directly in an index. The SAM Conservative Growth Blended Index is composed of 60% Russell 3000 Index, 20% Barclays Aggregate Bond Index, and 20% MSCI EAFE Index.

What contributed to or detracted from Portfolio performance during the fiscal year?

Tactical overweight to equity versus fixed income contributed to performance. Also, strategic and tactical underweight to government bonds aided performance, as government bonds underperformed other fixed income securities. Strategic and tactical allocation to preferred stock and preferred capital contributed to performance. Strategic allocation to international bonds hindered performance. Also, strategic allocation to emerging market stocks detracted from performance, as those holdings lagged U.S. issues. The Portfolio's security selection in mid cap value also hindered performance.

* Performance assumes reinvestment of all dividends and capital gains. Performance does not reflect the impact of federal, state, or municipal taxes. If it did, performance would be lower.

invest directly in an index. The SAM Flexible Income Blended Index is composed of 75% Barclays Aggregate Bond Index, 20% Russell 3000 Index, and 5% MSCI EAFE Index.

What contributed to or detracted from Portfolio performance during the fiscal year?

Strategic and tactical underweight to international developed market equities aided performance as developed market equities underperformed U.S. securities. Security selection in international developed market growth equity securities also contributed. Security selection in international emerging market growth stocks contributed to performance. Strategic allocation to emerging market stocks detracted from performance, as those holdings lagged U.S. issues. Security selection in mid cap value also hindered performance. Security selection within large cap value detracted from performance.

A sales charge may apply as follows: Class A shares: maximum up-front sales charge of 5.50%; Class B shares: contingent deferred sales charge of 5%, which will decline over 5 years (5-5-4-3-2-0%); Class C shares: contingent deferred sales charge of 1% on redemptions made during the first 12 months. See the prospectus for details. Performance listed with sales charge reflects the maximum sales charge.

* Performance assumes reinvestment of all dividends and capital gains. Performance does not reflect the impact of federal, state, or municipal taxes. If it did, performance would be lower.

invest directly in an index. The SAM Strategic Growth Blended Index is composed of 70% Russell 3000 Index, 25% MSCI EAFE Index, and 5% Barclays Aggregate Bond Index.


STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL FUNDS, INC.
October 31, 2014

		Principal			Principal			Principal
Amounts in thousands, except per share amounts	LifeTime 2010 Fund				LifeTime 2020 Fund			LifeTime 2030 Fund
Investment in affiliated Funds--at cost	$	1,457,173		$	5,885,172		$	5,722,309
Assets
Investment in affiliated Funds--at value	$	1,669,761		$	6,933,203		$	6,946,977
Receivables:
Dividends and interest		1,621			4,151			3,454
Expense reimbursement from Manager		2			10			8
Expense reimbursement from Distributor		2			7			8
Fund shares sold		239			1,161			931
Prepaid directors' expenses		–			1			1
Total Assets		1,671,625			6,938,533			6,951,379
Liabilities
Accrued management and investment advisory fees		42			172			171
Accrued administrative service fees		13			54			48
Accrued distribution fees		92			332			341
Accrued service fees		58			243			225
Accrued transfer agent fees		27			111			131
Accrued other expenses		38			103			130
Payables:
Fund shares redeemed		3,474			15,677			13,661
Total Liabilities		3,744			16,692			14,707
Net Assets Applicable to Outstanding Shares	$	1,667,881		$	6,921,841		$	6,936,672
Net Assets Consist of:
Capital shares and additional paid-in-capital	$	1,494,104		$	5,633,351		$	5,445,784
Accumulated undistributed (overdistributed) net investment income (loss)		10,486			22,828			15,217
Accumulated undistributed (overdistributed) net realized gain (loss)		(49,297	)		217,631			251,003
Net unrealized appreciation (depreciation) of investments		212,588			1,048,031			1,224,668
Total Net Assets	$	1,667,881		$	6,921,841		$	6,936,672
Capital Stock (par value: $.01 per share):
Shares authorized		650,000			1,125,000			1,225,000
Net Asset Value Per Share:
Class A: Net Assets	$	42,880		$	128,189		$	116,459
Shares Issued and Outstanding		3,116			8,551			7,643
Net Asset Value per share	$	13.76		$	14.99		$	15.24
Maximum Offering Price	$	14.30		$	15.86		$	16.13
Class B: Net Assets		N/A		$	3,302		$	3,758
Shares Issued and Outstanding					218			245
Net Asset Value per share				$	15.09	^(a)	$	15.37	^(a)
Class J: Net Assets	$	255,331		$	879,358		$	1,001,423
Shares Issued and Outstanding		18,709			59,192			66,026
Net Asset Value per share	$	13.65	^(a)	$	14.86	^(a)	$	15.17	^(a)
Institutional: Net Assets	$	1,096,931		$	4,743,088		$	4,734,382
Shares Issued and Outstanding		79,985			317,450			310,975
Net Asset Value per share	$	13.71		$	14.94		$	15.22
R-1: Net Assets	$	14,995		$	53,222		$	46,220
Shares Issued and Outstanding		1,104			3,598			3,068
Net Asset Value per share	$	13.58		$	14.79		$	15.07
R-2: Net Assets	$	15,736		$	76,267		$	72,768
Shares Issued and Outstanding		1,159			5,166			4,824
Net Asset Value per share	$	13.58		$	14.76		$	15.08
R-3: Net Assets	$	74,667		$	316,368		$	276,196
Shares Issued and Outstanding		5,505			21,409			18,259
Net Asset Value per share	$	13.56		$	14.78		$	15.13
R-4: Net Assets	$	59,247		$	249,613		$	243,720
Shares Issued and Outstanding		4,356			16,852			15,683
Net Asset Value per share	$	13.60		$	14.81		$	15.54
R-5: Net Assets	$	108,094		$	472,434		$	441,746
Shares Issued and Outstanding		7,925			31,794			29,081
Net Asset Value per share	$	13.64		$	14.86		$	15.19


STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL FUNDS, INC.
October 31, 2014

								Principal
		Principal			Principal			LifeTime Strategic
Amounts in thousands, except per share amounts	LifeTime 2040 Fund				LifeTime 2050 Fund			Income Fund
Investment in affiliated Funds--at cost	$	3,592,258		$	1,769,442		$	724,113
Assets
Investment in affiliated Funds--at value	$	4,471,692		$	2,193,547		$	804,005
Receivables:
Dividends and interest		1,399			514			1,018
Expense reimbursement from Manager		10			12			6
Expense reimbursement from Distributor		4			1			1
Fund shares sold		843			707			356
Prepaid directors' expenses		1			–			–
Total Assets		4,473,949			2,194,781			805,386
Liabilities
Accrued management and investment advisory fees		110			53			19
Accrued administrative service fees		32			17			6
Accrued distribution fees		206			81			37
Accrued service fees		145			75			26
Accrued transfer agent fees		107			69			17
Accrued registration fees		–			–			11
Accrued other expenses		108			70			25
Payables:
Fund shares redeemed		7,125			2,094			455
Total Liabilities		7,833			2,459			596
Net Assets Applicable to Outstanding Shares	$	4,466,116		$	2,192,322		$	804,790
Net Assets Consist of:
Capital shares and additional paid-in-capital	$	3,410,540		$	1,681,331		$	750,040
Accumulated undistributed (overdistributed) net investment income (loss)		5,792			2,483			7,141
Accumulated undistributed (overdistributed) net realized gain (loss)		170,350			84,403			(32,283	)
Net unrealized appreciation (depreciation) of investments		879,434			424,105			79,892
Total Net Assets	$	4,466,116		$	2,192,322		$	804,790
Capital Stock (par value: $.01 per share):
Shares authorized		1,050,000			825,000			750,000
Net Asset Value Per Share:
Class A: Net Assets	$	82,944		$	61,439		$	31,332
Shares Issued and Outstanding		5,352			4,013			2,548
Net Asset Value per share	$	15.50		$	15.31		$	12.30
Maximum Offering Price	$	16.40		$	16.20		$	12.78
Class B: Net Assets	$	3,159		$	934		$	336
Shares Issued and Outstanding		205			62			27
Net Asset Value per share	$	15.44	^(a)	$	15.24	^(a)	$	12.23	^(a)
Class J: Net Assets	$	569,314		$	159,787		$	77,956
Shares Issued and Outstanding		36,472			10,717			6,406
Net Asset Value per share	$	15.61	^(a)	$	14.91	^(a)	$	12.17	^(a)
Institutional: Net Assets	$	3,109,551		$	1,603,984		$	573,524
Shares Issued and Outstanding		197,584			105,040			46,830
Net Asset Value per share	$	15.74		$	15.27		$	12.25
R-1: Net Assets	$	33,659		$	18,098		$	7,563
Shares Issued and Outstanding		2,166			1,200			622
Net Asset Value per share	$	15.54		$	15.08		$	12.17
R-2: Net Assets	$	51,404		$	31,670		$	9,709
Shares Issued and Outstanding		3,308			2,102			797
Net Asset Value per share	$	15.54		$	15.07		$	12.18
R-3: Net Assets	$	169,617		$	78,959		$	35,215
Shares Issued and Outstanding		10,914			5,228			2,910
Net Asset Value per share	$	15.54		$	15.10		$	12.10
R-4: Net Assets	$	153,985		$	73,607		$	21,059
Shares Issued and Outstanding		9,892			4,854			1,735
Net Asset Value per share	$	15.57		$	15.16		$	12.14
R-5: Net Assets	$	292,483		$	163,844		$	48,096
Shares Issued and Outstanding		18,679			10,778			3,937
Net Asset Value per share	$	15.66		$	15.20		$	12.22


	STATEMENTS OF ASSETS AND LIABILITIES
	PRINCIPAL FUNDS, INC.
	October 31, 2014

		SAM Balanced				SAM Conservative			SAM Conservative
Amounts in thousands, except per share amounts		Portfolio				Balanced Portfolio			Growth Portfolio
Investment in affiliated Funds--at cost		$	3,799,811		$	1,397,044		$	2,382,074
Assets
Investment in affiliated Funds--at value		$	4,910,788		$	1,650,113		$	3,275,187
Receivables:
Dividends and interest			4,677			2,641			993
Expense reimbursement from Manager			–			17			–
Expense reimbursement from Distributor			8			4			4
Fund shares sold			2,614			1,229			2,622
	Total Assets		4,918,087			1,654,004			3,278,806
Liabilities
Accrued management and investment advisory fees			1,243			422			824
Accrued administrative service fees			8			3			5
Accrued distribution fees			1,322			433			918
Accrued service fees			51			17			30
Accrued transfer agent fees			436			153			401
Accrued other expenses			258			104			189
Payables:
Fund shares redeemed			5,337			2,807			3,720
	Total Liabilities		8,655			3,939			6,087
Net Assets Applicable to Outstanding Shares		$	4,909,432		$	1,650,065		$	3,272,719
Net Assets Consist of:
Capital shares and additional paid-in-capital		$	3,754,827		$	1,382,924		$	2,316,841
Accumulated undistributed (overdistributed) net investment income (loss)			2,226			2,598			2,713
Accumulated undistributed (overdistributed) net realized gain (loss)			41,402			11,474			60,052
Net unrealized appreciation (depreciation) of investments			1,110,977			253,069			893,113
	Total Net Assets	$	4,909,432		$	1,650,065		$	3,272,719
Capital Stock (par value: $.01 per share):
Shares authorized			1,825,000			1,625,000			1,825,000
Net Asset Value Per Share:
Class A: Net Assets	$		2,083,846		$	490,692		$	1,493,034
Shares Issued and Outstanding			127,125			39,548			79,166
Net Asset Value per share	$		16.39		$	12.41		$	18.86
Maximum Offering Price	$		17.34		$	13.13		$	19.96
Class B: Net Assets	$		76,824		$	13,287		$	57,673
Shares Issued and Outstanding			4,689			1,069			3,160
Net Asset Value per share	$		16.38	^(a)	$	12.43	^(a)	$	18.25	^(a)
Class C: Net Assets	$		732,362		$	242,887		$	551,460
Shares Issued and Outstanding			45,194			19,754			30,965
Net Asset Value per share	$		16.20	^(a)	$	12.30	^(a)	$	17.81	^(a)
Class J: Net Assets	$		981,860		$	530,582		$	496,391
Shares Issued and Outstanding			61,508			43,234			27,034
Net Asset Value per share	$		15.96	^(a)	$	12.27	^(a)	$	18.36	^(a)
Institutional: Net Assets	$		787,845		$	288,691		$	526,264
Shares Issued and Outstanding			48,668			23,457			28,336
Net Asset Value per share	$		16.19		$	12.31		$	18.57
R-1: Net Assets	$		4,602		$	2,823		$	4,246
Shares Issued and Outstanding			285			230			232
Net Asset Value per share	$		16.15		$	12.27		$	18.26
R-2: Net Assets	$		9,335		$	2,756		$	8,556
Shares Issued and Outstanding			579			223			468
Net Asset Value per share	$		16.11		$	12.33		$	18.28
R-3: Net Assets	$		61,467		$	21,180		$	26,537
Shares Issued and Outstanding			3,808			1,724			1,449
Net Asset Value per share	$		16.14		$	12.29		$	18.32
R-4: Net Assets	$		56,036		$	20,811		$	24,177
Shares Issued and Outstanding			3,466			1,692			1,308
Net Asset Value per share	$		16.17		$	12.30		$	18.48
R-5: Net Assets	$		115,255		$	36,356		$	84,381
Shares Issued and Outstanding			7,127			2,956			4,575
Net Asset Value per share	$		16.17		$	12.30		$	18.44


STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL FUNDS, INC.
October 31, 2014

	SAM Flexible				SAM Strategic
Amounts in thousands, except per share amounts	Income Portfolio				Growth Portfolio
Investment in affiliated Funds--at cost	$	1,843,572		$	1,427,140
Assets
Investment in affiliated Funds--at value	$	2,066,781		$	2,016,821
Receivables:
Dividends and interest		4,485			–
Expense reimbursement from Distributor		6			2
Fund shares sold		5,924			823
Total Assets		2,077,196			2,017,646
Liabilities
Accrued management and investment advisory fees		530			504
Accrued administrative service fees		2			4
Accrued distribution fees		593			578
Accrued service fees		9			16
Accrued transfer agent fees		169			310
Accrued other expenses		136			153
Payables:
Dividends payable		3,503			–
Fund shares redeemed		2,168			2,904
Total Liabilities		7,110			4,469
Net Assets Applicable to Outstanding Shares	$	2,070,086		$	2,013,177
Net Assets Consist of:
Capital shares and additional paid-in-capital	$	1,840,330		$	1,356,022
Accumulated undistributed (overdistributed) net investment income (loss)		199			5,432
Accumulated undistributed (overdistributed) net realized gain (loss)		6,348			62,042
Net unrealized appreciation (depreciation) of investments		223,209			589,681
Total Net Assets	$	2,070,086		$	2,013,177
Capital Stock (par value: $.01 per share):
Shares authorized		1,725,000			2,025,000
Net Asset Value Per Share:
Class A: Net Assets	$	793,238		$	989,320
Shares Issued and Outstanding		62,756			45,397
Net Asset Value per share	$	12.64		$	21.79
Maximum Offering Price	$	13.13		$	23.06
Class B: Net Assets	$	16,548		$	45,191
Shares Issued and Outstanding		1,307			2,210
Net Asset Value per share	$	12.66	^(a)	$	20.45	^(a)
Class C: Net Assets	$	311,494		$	333,072
Shares Issued and Outstanding		24,858			16,389
Net Asset Value per share	$	12.53	^(a)	$	20.32	^(a)
Class J: Net Assets	$	723,517		$	283,507
Shares Issued and Outstanding		57,660			13,337
Net Asset Value per share	$	12.55	^(a)	$	21.26	^(a)
Institutional: Net Assets	$	180,049		$	280,593
Shares Issued and Outstanding		14,285			13,077
Net Asset Value per share	$	12.60		$	21.46
R-1: Net Assets	$	741		$	4,253
Shares Issued and Outstanding		59			202
Net Asset Value per share	$	12.56		$	21.10
R-2: Net Assets	$	1,139		$	4,779
Shares Issued and Outstanding		90			226
Net Asset Value per share	$	12.59		$	21.15
R-3: Net Assets	$	10,483		$	17,809
Shares Issued and Outstanding		833			840
Net Asset Value per share	$	12.58		$	21.19
R-4: Net Assets	$	12,062		$	20,035
Shares Issued and Outstanding		958			940
Net Asset Value per share	$	12.59		$	21.32
R-5: Net Assets	$	20,815		$	34,618
Shares Issued and Outstanding		1,654			1,627
Net Asset Value per share	$	12.58		$	21.28


STATEMENTS OF OPERATIONS
PRINCIPAL FUNDS, INC.
Year Ended October 31, 2014


	Principal			Principal		Principal
Amounts in thousands	LifeTime 2010 Fund			LifeTime 2020 Fund		LifeTime 2030 Fund
Net Investment Income (Loss)
Income:
Dividends from affiliated Funds	$	34,635	$	133,503	$	129,179
Total Income		34,635		133,503		129,179
Expenses:
Management and investment advisory fees		500		2,002		1,981
Distribution fees - Class A		108		306		276
Distribution fees - Class B		N/A		36		38
Distribution fees - Class J		689		2,351		2,634
Distribution fees - R-1		58		192		160
Distribution fees - R-2		55		231		221
Distribution fees - R-3		194		768		683
Distribution fees - R-4		66		259		243
Administrative service fees - R-1		46		153		128
Administrative service fees - R-2		37		154		148
Administrative service fees - R-3		54		215		191
Administrative service fees - R-4		20		78		73
Administrative service fees - R-5		11		46		43
Registration fees - Class A		18		21		22
Registration fees - Class B		N/A		17		18
Registration fees - Class J		23		36		50
Registration fees - Institutional		21		54		68
Service fees - R-1		41		137		114
Service fees - R-2		46		193		185
Service fees - R-3		194		767		683
Service fees - R-4		164		648		606
Service fees - R-5		277		1,149		1,088
Shareholder reports - Class A		5		13		18
Shareholder reports - Class B		N/A		1		1
Shareholder reports - Class J		19		69		97
Shareholder reports - Institutional		1		3		4
Transfer agent fees - Class A		52		150		138
Transfer agent fees - Class B		N/A		10		11
Transfer agent fees - Class J		96		365		499
Transfer agent fees - Institutional		7		26		15
Directors' expenses		24		100		100
Professional fees		27		41		41
Other expenses		18		72		70
Total Gross Expenses		2,871		10,663		10,647
Less: Reimbursement from Manager - Class A		21		29		38
Less: Reimbursement from Manager - Class B		N/A		24		24
Less: Reimbursement from Distributor - Class J		97		327		364
Total Net Expenses		2,753		10,283		10,221
Net Investment Income (Loss)		31,882		123,220		118,958

Net Realized and Unrealized Gain (Loss) on Investments
Net realized gain (loss) from:
Investment transactions in affiliated Funds		34,083		109,012		93,164
Capital gain distribution received from affiliated Funds		19,052		116,757		162,907
Change in unrealized appreciation/depreciation of:
Investments in affiliated Funds		18,471		144,603		166,659
Net Realized and Unrealized Gain (Loss) on Investments		71,606		370,372		422,730
Net Increase (Decrease) in Net Assets Resulting from Operations	$	103,488	$	493,592	$	541,688


STATEMENTS OF OPERATIONS
PRINCIPAL FUNDS, INC.
Year Ended October 31, 2014


						Principal
	Principal			Principal		LifeTime Strategic
Amounts in thousands	LifeTime 2040 Fund			LifeTime 2050 Fund		Income Fund
Net Investment Income (Loss)
Income:
Dividends from affiliated Funds	$	77,911	$	37,026	$	17,840
Total Income		77,911		37,026		17,840
Expenses:
Management and investment advisory fees		1,264		612		237
Distribution fees - Class A		191		142		79
Distribution fees - Class B		32		10		4
Distribution fees - Class J		1,484		399		210
Distribution fees - R-1		117		59		30
Distribution fees - R-2		162		93		29
Distribution fees - R-3		401		186		94
Distribution fees - R-4		157		73		21
Administrative service fees - R-1		94		47		24
Administrative service fees - R-2		108		62		20
Administrative service fees - R-3		112		52		26
Administrative service fees - R-4		47		22		6
Administrative service fees - R-5		28		15		5
Registration fees - Class A		22		20		19
Registration fees - Class B		17		17		16
Registration fees - Class J		37		25		17
Registration fees - Institutional		62		39		26
Service fees - R-1		84		42		21
Service fees - R-2		135		78		25
Service fees - R-3		401		186		94
Service fees - R-4		392		183		54
Service fees - R-5		691		372		118
Shareholder reports - Class A		15		14		3
Shareholder reports - Class B		1		1		–
Shareholder reports - Class J		73		29		9
Shareholder reports - Institutional		5		6		1
Transfer agent fees - Class A		114		100		43
Transfer agent fees - Class B		10		8		7
Transfer agent fees - Class J		428		251		43
Transfer agent fees - Institutional		10		6		2
Directors' expenses		61		32		13
Professional fees		33		27		23
Other expenses		44		21		9
Total Gross Expenses		6,832		3,229		1,328
Less: Reimbursement from Manager - Class A		54		63		26
Less: Reimbursement from Manager - Class B		24		24		23
Less: Reimbursement from Distributor - Class J		204		54		30
Total Net Expenses		6,550		3,088		1,249
Net Investment Income (Loss)		71,361		33,938		16,591

Net Realized and Unrealized Gain (Loss) on Investments
Net realized gain (loss) from:
Investment transactions in affiliated Funds		60,162		29,042		6,949
Capital gain distribution received from affiliated Funds		112,372		56,531		4,988
Change in unrealized appreciation/depreciation of:
Investments in affiliated Funds		126,094		66,873		11,735
Net Realized and Unrealized Gain (Loss) on Investments		298,628		152,446		23,672
Net Increase (Decrease) in Net Assets Resulting from Operations	$	369,989	$	186,384	$	40,263


STATEMENTS OF OPERATIONS
PRINCIPAL FUNDS, INC.
Year Ended October 31, 2014


	SAM Balanced			SAM Conservative		SAM Conservative
Amounts in thousands	Portfolio			Balanced Portfolio		Growth Portfolio
Net Investment Income (Loss)
Income:
Dividends from affiliated Funds	$	107,235	$	42,277	$	58,235
Total Income		107,235		42,277		58,235
Expenses:
Management and investment advisory fees		14,548		4,838		9,770
Distribution fees - Class A		5,021		1,170		3,617
Distribution fees - Class B		945		165		720
Distribution fees - Class C		6,947		2,280		5,339
Distribution fees - Class J		2,593		1,390		1,304
Distribution fees - R-1		15		12		15
Distribution fees - R-2		28		9		25
Distribution fees - R-3		164		54		69
Distribution fees - R-4		53		17		22
Administrative service fees - R-1		12		9		12
Administrative service fees - R-2		19		6		17
Administrative service fees - R-3		46		15		19
Administrative service fees - R-4		16		5		7
Administrative service fees - R-5		10		4		8
Registration fees - Class A		57		38		40
Registration fees - Class B		16		16		16
Registration fees - Class C		34		23		24
Registration fees - Class J		58		42		40
Registration fees - Institutional		21		17		18
Service fees - R-1		11		8		11
Service fees - R-2		23		8		21
Service fees - R-3		163		54		69
Service fees - R-4		133		44		56
Service fees - R-5		257		85		197
Shareholder reports - Class A		263		58		219
Shareholder reports - Class B		30		5		24
Shareholder reports - Class C		79		25		73
Shareholder reports - Class J		67		30		36
Shareholder reports - Institutional		–		–		1
Transfer agent fees - Class A		1,375		327		1,092
Transfer agent fees - Class B		90		24		80
Transfer agent fees - Class C		472		159		399
Transfer agent fees - Class J		381		205		227
Transfer agent fees - Institutional		4		1		2
Directors' expenses		72		25		49
Professional fees		24		22		26
Other expenses		51		17		34
Total Gross Expenses		34,098		11,207		23,698
Less: Reimbursement from Manager - Class A		–		105		–
Less: Reimbursement from Manager - Class B		–		33		–
Less: Reimbursement from Manager - Class C		–		51		–
Less: Reimbursement from Distributor - Class J		361		190		179
Total Net Expenses		33,737		10,828		23,519
Net Investment Income (Loss)		73,498		31,449		34,716

Net Realized and Unrealized Gain (Loss) on Investments
Net realized gain (loss) from:
Investment transactions in affiliated Funds		6,643		361		10,065
Capital gain distribution received from affiliated Funds		106,901		25,198		92,152
Change in unrealized appreciation/depreciation of:
Investments in affiliated Funds		191,459		48,706		157,107
Net Realized and Unrealized Gain (Loss) on Investments		305,003		74,265		259,324
Net Increase (Decrease) in Net Assets Resulting from Operations	$	378,501	$	105,714	$	294,040


STATEMENTS OF OPERATIONS
PRINCIPAL FUNDS, INC.
Year Ended October 31, 2014

	SAM Flexible			SAM Strategic
Amounts in thousands	Income Portfolio			Growth Portfolio
Net Investment Income (Loss)
Income:
Dividends from affiliated Funds	$	61,674	$	32,934
Total Income		61,674		32,934
Expenses:
Management and investment advisory fees		5,937		6,058
Distribution fees - Class A		1,877		2,409
Distribution fees - Class B		198		564
Distribution fees - Class C		2,817		3,283
Distribution fees - Class J		1,825		761
Distribution fees - R-1		3		15
Distribution fees - R-2		4		14
Distribution fees - R-3		27		47
Distribution fees - R-4		12		17
Administrative service fees - R-1		2		12
Administrative service fees - R-2		3		10
Administrative service fees - R-3		8		13
Administrative service fees - R-4		3		5
Administrative service fees - R-5		2		3
Registration fees - Class A		55		29
Registration fees - Class B		16		15
Registration fees - Class C		27		20
Registration fees - Class J		61		26
Registration fees - Institutional		17		18
Service fees - R-1		2		10
Service fees - R-2		3		12
Service fees - R-3		27		47
Service fees - R-4		30		44
Service fees - R-5		48		79
Shareholder reports - Class A		75		177
Shareholder reports - Class B		6		20
Shareholder reports - Class C		31		55
Shareholder reports - Class J		36		27
Transfer agent fees - Class A		433		848
Transfer agent fees - Class B		23		73
Transfer agent fees - Class C		191		286
Transfer agent fees - Class J		270		159
Transfer agent fees - Institutional		2		2
Directors' expenses		30		30
Professional fees		23		18
Other expenses		21		21
Total Gross Expenses		14,145		15,227
Less: Reimbursement from Distributor - Class J		248		106
Total Net Expenses		13,897		15,121
Net Investment Income (Loss)		47,777		17,813

Net Realized and Unrealized Gain (Loss) on Investments
Net realized gain (loss) from:
Investment transactions in affiliated Funds		323		15,421
Capital gain distribution received from affiliated Funds		20,884		78,701
Change in unrealized appreciation/depreciation of:
Investments in affiliated Funds		48,443		97,180
Net Realized and Unrealized Gain (Loss) on Investments		69,650		191,302
Net Increase (Decrease) in Net Assets Resulting from Operations	$	117,427	$	209,115


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.




Amounts in thousands																			Principal LifeTime 2010 Fund
																			Year Ended				Year Ended
																			October 31, 2014				October 31, 2013
Operations
Net investment income (loss)																			$		31,882		$	38,308
Net realized gain (loss) on investments																					53,135			24,080
Change in unrealized appreciation/depreciation of investments																					18,471			109,666
				Net Increase (Decrease) in Net Assets Resulting from Operations																	103,488			172,054

Dividends and Distributions to Shareholders
From net investment income																					(31,301	)		(39,103	)
												Total Dividends and Distributions									(31,301	)		(39,103	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																					(71,997	)		(175,926	)
										Total Increase (Decrease) in Net Assets											190			(42,975	)

Net Assets
Beginning of period																					1,667,691			1,710,666
End of period (including undistributed net investment income as set forth below)																			$		1,667,881		$	1,667,691
Undistributed (overdistributed) net investment income (loss)																			$		10,486		$	9,905

		Class A		Class J			Institutional			R-1		R-2		R-3		R-4			R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	6,707	$	44,302		$	97,459		$	1,096	$	1,800	$	18,454	$	7,929	$		23,966
Reinvested		725		4,074			21,842			196		246		1,143		1,121			1,925
Redeemed		(8,412	)	(39,112	)		(162,872	)		(5,421	)	(7,869	)	(24,466	)	(20,904	)		(35,926	)
Net Increase (Decrease)	$	(980	) $	9,264		$	(43,571	)	$	(4,129	) $	(5,823	) $	(4,869)		$ (11,854)		$	(10,035)
Shares:
Sold		501		3,319			7,226			82		136		1,395		599			1,792
Reinvested		55		312			1,668			15		19		88		86			148
Redeemed		(625	)	(2,936	)		(12,150	)		(409	)	(593	)	(1,846	)	(1,570	)		(2,685	)
Net Increase (Decrease)		(69	)	695			(3,256	)		(312	)	(438	)	(363	)	(885	)		(745	)
Year Ended October 31, 2013
Dollars:
Sold	$	8,710	$	41,639		$	55,620		$	1,405	$	2,443	$	17,398	$	13,737	$		25,035
Reinvested		765		4,571			27,792			300		392		1,442		1,310			2,520
Redeemed		(8,818	)	(42,973	)		(227,056	)		(5,323	)	(9,829	)	(28,575	)	(20,597	)		(37,834	)
Net Increase (Decrease)	$	657	$	3,237		$	(143,644	)	$	(3,618	) $	(6,994	) $	(9,735	) $	(5,550)	$		(10,279)
Shares:
Sold		692		3,352			4,466			114		197		1,397		1,111			2,014
Reinvested		63		381			2,309			25		33		121		109			210
Redeemed		(701	)	(3,443	)		(18,203	)		(430	)	(798	)	(2,313	)	(1,667	)		(3,041	)
Net Increase (Decrease)		54		290			(11,428	)		(291	)	(568	)	(795	)	(447	)		(817	)

Distributions:
Year Ended October 31, 2014
From net investment income		$(729	) $	(4,077) $			(21,864)		$	(196	) $	(246	) $	(1,143	) $	(1,121	) $		(1,925	)
From net realized gain on
investments		–		–			–			–		–		–		–			–
Total Dividends and Distributions		$(729	) $	(4,077) $			(21,864)		$	(196	) $	(246	) $	(1,143	) $	(1,121	) $		(1,925	)
Year Ended October 31, 2013
From net investment income		$(770	) $	(4,576) $			(27,793)		$	(300	) $	(392	) $	(1,442	) $	(1,310	) $		(2,520	)
From net realized gain on
investments		–		–			–			–		–		–		–			–
Total Dividends and Distributions		$(770	) $	(4,576) $			(27,793)		$	(300	) $	(392	) $	(1,442	) $	(1,310	) $		(2,520	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.




Amounts in thousands																								Principal LifeTime 2020 Fund
																								Year Ended							Year Ended
																								October 31, 2014							October 31, 2013
Operations
Net investment income (loss)																								$		123,220					$	124,655
Net realized gain (loss) on investments																										225,769						211,144
Change in unrealized appreciation/depreciation of investments																										144,603						531,150
						Net Increase (Decrease) in Net Assets Resulting from Operations																				493,592						866,949

Dividends and Distributions to Shareholders
From net investment income																										(118,013				)		(124,847	)
From net realized gain on investments																													(65,974	)		–
															Total Dividends and Distributions											(183,987				)		(124,847	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																										227,848						23,505
											Total Increase (Decrease) in Net Assets															537,453						765,607

Net Assets
Beginning of period																										6,384,388						5,618,781
End of period (including undistributed net investment income as set forth below)																								$		6,921,841					$	6,384,388
Undistributed (overdistributed) net investment income (loss)																								$					22,828		$	17,621

		Class A				Class B		Class J			Institutional				R-1		R-2		R-3					R-4					R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	24,600		$		56		$ 138,349		$	365,766			$	5,223	$	10,009	$	52,681			$		33,947		$			95,283
Reinvested		3,114				58		21,430			129,850				1,165		1,739		7,295					7,117					12,001
Redeemed		(23,421	)			(1,122	)	(101,988	)		(312,889	)			(13,581	)	(17,777	)	(48,826	)				(66,226	)				(96,005	)
Net Increase (Decrease)	$	4,293		$		(1,008)	$	57,791		$	182,727			$	(7,193)	$	(6,029)	$	11,150		$			(25,162)			$		11,279
Shares:
Sold		1,689				4		9,576			25,107				363		695		3,663					2,346					6,582
Reinvested		218				4		1,513			9,131				82		123		517					504					847
Redeemed		(1,616	)			(77	)	(7,054	)		(21,498	)			(943	)	(1,240	)	(3,392	)				(4,617	)				(6,599	)
Net Increase (Decrease)		291				(69	)	4,035			12,740				(498	)	(422	)	788					(1,767	)				830
Year Ended October 31, 2013
Dollars:
Sold	$	20,090		$		156	$	130,182		$	306,456			$	5,211	$	10,207	$	50,883			$		53,603		$			67,390
Reinvested		1,987				49		13,476			90,374				910		1,211		4,674					4,112					8,043
Redeemed		(17,185	)			(2,706	)	(106,907	)		(411,481	)			(18,281	)	(19,882	)	(61,714	)				(36,750	)				(70,603	)
Net Increase (Decrease)	$	4,892		$		(2,501)	$	36,751		$	(14,651	)	$	(12,160)		$	(8,464)	$	(6,157	)			$	20,965		$			4,830
Shares:
Sold		1,501				11		9,857			23,058				396		778		3,842					4,064					5,049
Reinvested		157				4		1,071			7,161				72		96		373					328					639
Redeemed		(1,282	)			(202	)	(8,044	)		(31,230	)			(1,382	)	(1,511	)	(4,687	)				(2,772	)				(5,365	)
Net Increase (Decrease)		376				(187	)	2,884			(1,011	)			(914	)	(637	)	(472	)				1,620					323

Distributions:
Year Ended October 31, 2014
From net investment income		$(1,908)			$	(19)		$(13,256)			$ (85,225)			$	(573)	$	(939)	$	(4,230)				$	(4,347)			$		(7,516	)
From net realized gain on
investments		(1,219	)			(39	)	(8,179	)		(44,824	)			(592	)	(801	)	(3,065	)				(2,770	)				(4,485	)
Total Dividends and Distributions		$(3,127)			$	(58)		$(21,435)			$ (130,049)			$	(1,165)	$	(1,740)	$	(7,295)				$	(7,117)				$	(12,001)
Year Ended October 31, 2013
From net investment income		$(1,989)				$(50)		$(13,484)			$ (90,374)			$	(910	) $	(1,211	) $	(4,674)				$	(4,112)			$		(8,043	)
From net realized gain on
investments		–				–		–			–				–		–		–					–					–
Total Dividends and Distributions		$(1,989)			$	(50) $		(13,484)			$ (90,374)			$	(910	) $	(1,211	) $	(4,674)				$	(4,112)			$		(8,043	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.




Amounts in thousands																						Principal LifeTime 2030 Fund
																						Year Ended							Year Ended
																						October 31, 2014							October 31, 2013
Operations
Net investment income (loss)																						$		118,958					$	116,057
Net realized gain (loss) on investments																								256,071						198,649
Change in unrealized appreciation/depreciation of investments																								166,659						664,474
						Net Increase (Decrease) in Net Assets Resulting from Operations																		541,688						979,180

Dividends and Distributions to Shareholders
From net investment income																								(116,319				)		(112,077	)
From net realized gain on investments																											(82,514	)		–
															Total Dividends and Distributions									(198,833				)		(112,077	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																								368,408						113,024
											Total Increase (Decrease) in Net Assets													711,263						980,127

Net Assets
Beginning of period																								6,225,409						5,245,282
End of period (including undistributed net investment income as set forth below)																						$		6,936,672					$	6,225,409
Undistributed (overdistributed) net investment income (loss)																						$					15,217		$	12,578

		Class A				Class B		Class J			Institutional				R-1		R-2			R-3		R-4					R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	23,109		$		29	$	159,016		$	411,513			$	5,317	$	10,863	$		36,968	$	38,488		$			78,934
Reinvested		3,119				75		26,421			138,868				1,116		1,907			7,360		7,168					12,515
Redeemed		(20,370	)			(556	)	(100,491	)		(248,398	)			(9,787	)	(19,710	)		(45,891	)	(59,943	)				(89,232	)
Net Increase (Decrease)	$	5,858		$		(452	) $	84,946		$	301,983			$	(3,354	) $	(6,940	) $		(1,563)		$ (14,287)				$	2,217
Shares:
Sold		1,566				2		10,801			27,856				363		739			2,519		2,535					5,371
Reinvested		215				5		1,835			9,618				78		133			512		486					868
Redeemed		(1,387	)			(37	)	(6,824	)		(16,801	)			(671	)	(1,348	)		(3,126	)	(4,027	)				(6,016	)
Net Increase (Decrease)		394				(30	)	5,812			20,673				(230	)	(476	)		(95	)	(1,006	)				223
Year Ended October 31, 2013
Dollars:
Sold	$	17,439		$		69		$ 152,796		$	347,660			$	5,594	$	11,118	$		47,155	$	44,555		$			70,067
Reinvested		1,619				43		13,246			81,046				706		1,108			3,878		3,520					6,890
Redeemed		(12,701	)			(2,135	)	(93,821	)		(390,217	)			(19,779	)	(24,161	)		(55,082	)	(33,813	)				(63,776	)
Net Increase (Decrease)	$	6,357		$		(2,023	) $	72,221		$	38,489		$		(13,479)		$ (11,935)		$	(4,049	) $	14,262		$			13,181
Shares:
Sold		1,310				5		11,546			26,209				422		846			3,556		3,297					5,222
Reinvested		129				3		1,061			6,484				57		89			311		275					551
Redeemed		(950	)			(159	)	(7,050	)		(29,706	)			(1,494	)	(1,849	)		(4,176	)	(2,477	)				(4,845	)
Net Increase (Decrease)		489				(151	)	5,557			2,987				(1,015	)	(914	)		(309	)	1,095					928

Distributions:
Year Ended October 31, 2014
From net investment income		$(1,728			) $	(24) $		(14,799)			$ (83,448)			$	(489	) $	(911	) $		(3,842	) $	(3,955			) $		(7,123	)
From net realized gain on
investments		(1,398	)			(51	)	(11,625	)		(55,692	)			(627	)	(998	)		(3,518	)	(3,213	)				(5,392	)
Total Dividends and Distributions		$(3,126			) $	(75)	$	(26,424)			$ (139,140)			$	(1,116	) $	(1,909	) $		(7,360	) $	(7,168) $ (12,515)
Year Ended October 31, 2013
From net investment income		$(1,625			) $	(43)	$	(13,261)			$ (81,046)			$	(706	) $	(1,108	) $		(3,878	) $	(3,520			) $		(6,890	)
From net realized gain on
investments		–				–		–			–				–		–			–		–					–
Total Dividends and Distributions		$(1,625			) $	(43)	$	(13,261)			$ (81,046)			$	(706	) $	(1,108	) $		(3,878	) $	(3,520			) $		(6,890	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.




Amounts in thousands																							Principal LifeTime 2040 Fund
																							Year Ended						Year Ended
																							October 31, 2014						October 31, 2013
Operations
Net investment income (loss)																							$				71,361		$	68,562
Net realized gain (loss) on investments																									172,534					128,711
Change in unrealized appreciation/depreciation of investments																									126,094					496,563
						Net Increase (Decrease) in Net Assets Resulting from Operations																			369,989					693,836

Dividends and Distributions to Shareholders
From net investment income																											(70,619	)		(66,204	)
From net realized gain on investments																											(96,482	)		–
															Total Dividends and Distributions										(167,101			)		(66,204	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																									331,571					101,141
											Total Increase (Decrease) in Net Assets														534,459					728,773

Net Assets
Beginning of period																									3,931,657					3,202,884
End of period (including undistributed net investment income as set forth below)																							$		4,466,116				$	3,931,657
Undistributed (overdistributed) net investment income (loss)																							$				5,792		$	5,050

		Class A				Class B		Class J			Institutional				R-1		R-2		R-3				R-4				R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	17,450		$		41		$ 102,869		$	295,144			$	4,258	$	7,408	$	29,403		$		27,879		$		59,860
Reinvested		2,884				100		19,807			118,374				1,166		2,005		5,843				6,455				10,456
Redeemed		(11,008	)			(434	)	(63,157	)		(164,371	)			(7,092	)	(16,370	)	(24,837	)			(40,710	)			(51,852	)
Net Increase (Decrease)	$	9,326		$		(293	) $	59,519		$	249,147			$	(1,668	) $	(6,957	) $	10,409		$		(6,376)			$	18,464
Shares:
Sold		1,163				3		6,802			19,379				282		491		1,952				1,845				3,959
Reinvested		197				7		1,341			7,954				79		136		397				438				705
Redeemed		(735	)			(29	)	(4,175	)		(10,764	)			(471	)	(1,088	)	(1,654	)			(2,740	)			(3,406	)
Net Increase (Decrease)		625				(19	)	3,968			16,569				(110	)	(461	)	695				(457	)			1,258
Year Ended October 31, 2013
Dollars:
Sold	$	12,739		$		86	$	92,643		$	266,865			$	4,814	$	11,500	$	29,183		$		30,935		$		58,164
Reinvested		1,018				35		6,751			48,977				451		730		2,121				2,214				3,900
Redeemed		(9,164	)			(1,437	)	(51,485	)		(269,047	)			(15,877	)	(13,356	)	(37,414	)			(28,030	)			(46,175	)
Net Increase (Decrease)	$	4,593		$		(1,316	) $	47,909		$	46,795		$	(10,612		) $	(1,126	) $	(6,110)			$	5,119		$		15,889
Shares:
Sold		943				6		6,850			19,598				360		862		2,158				2,296				4,209
Reinvested		81				3		533			3,854				36		58		168				175				308
Redeemed		(679	)			(107	)	(3,778	)		(19,975	)			(1,175	)	(1,001	)	(2,770	)			(2,042	)			(3,435	)
Net Increase (Decrease)		345				(98	)	3,605			3,477				(779	)	(81	)	(444	)			429				1,082

Distributions:
Year Ended October 31, 2014
From net investment income		$(1,133)			$	(20	) $	(7,790)			$ (51,815)			$	(329	) $	(643	) $	(2,098			) $	(2,535)			$	(4,256	)
From net realized gain on
investments		(1,757	)			(80	)	(12,019	)		(66,559	)			(837	)	(1,365	)	(3,745	)			(3,920	)			(6,200	)
Total Dividends and Distributions		$(2,890)			$	(100)		$ (19,809)			$ (118,374)			$	(1,166	) $	(2,008	) $	(5,843			) $	(6,455)				$ (10,456)
Year Ended October 31, 2013
From net investment income		$(1,019			) $	(35	) $	(6,757)			$ (48,977)			$	(451	) $	(730	) $	(2,121)			$	(2,214)			$	(3,900	)
From net realized gain on
investments		–				–		–			–				–		–		–				–				–
Total Dividends and Distributions		$(1,019)			$	(35	) $	(6,757)			$ (48,977)			$	(451	) $	(730	) $	(2,121)			$	(2,214)			$	(3,900	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.




Amounts in thousands																										Principal LifeTime 2050 Fund
																										Year Ended						Year Ended
																										October 31, 2014						October 31, 2013
Operations
Net investment income (loss)																										$				33,938		$	30,571
Net realized gain (loss) on investments																														85,573			61,888
Change in unrealized appreciation/depreciation of investments																														66,873			243,201
						Net Increase (Decrease) in Net Assets Resulting from Operations																						186,384					335,660

Dividends and Distributions to Shareholders
From net investment income																														(34,006	)		(28,890	)
From net realized gain on investments																														(53,246	)		–
														Total Dividends and Distributions																(87,252	)		(28,890	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																												229,185					164,551
											Total Increase (Decrease) in Net Assets																	328,317					471,321

Net Assets
Beginning of period																												1,864,005					1,392,684
End of period (including undistributed net investment income as set forth below)																										$		2,192,322				$	1,864,005
Undistributed (overdistributed) net investment income (loss)																										$				2,483		$	2,551

		Class A				Class B		Class J			Institutional			R-1				R-2				R-3				R-4				R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	14,098		$		20	$	40,725		$	188,169		$	3,223		$		6,136		$		17,693		$		17,246		$		36,255
Reinvested		2,267				33		5,627			65,324			634				1,212				2,893				3,200				6,010
Redeemed		(8,070	)			(178	)	(18,018	)		(93,093	)		(2,854	)			(6,423	)			(13,664	)			(19,567	)			(19,713	)
Net Increase (Decrease)	$	8,295		$		(125	) $	28,334		$	160,400		$	1,003		$		925		$		6,922		$		879		$		22,552
Shares:
Sold		955				1		2,819			12,759			220				420				1,215				1,172				2,467
Reinvested		157				3		400			4,535			45				85				203				223				419
Redeemed		(546	)			(12	)	(1,250	)		(6,313	)		(197	)			(442	)			(933	)			(1,350	)			(1,335	)
Net Increase (Decrease)		566				(8	)	1,969			10,981			68				63				485				45				1,551
Year Ended October 31, 2013
Dollars:
Sold	$	16,775		$		27	$	30,074		$	199,931		$	4,096		$		8,191		$		17,398		$		18,146		$		41,499
Reinvested		570				12		1,580			22,575			200				358				842				1,049				1,701
Redeemed		(6,255	)			(517	)	(15,576	)		(109,753	)		(9,149	)			(5,987	)			(13,634	)			(20,345	)			(19,257	)
Net Increase (Decrease)	$	11,090		$		(478	) $	16,078		$	112,753		$	(4,853)			$	2,562		$		4,606		$		(1,150)			$	23,943
Shares:
Sold		1,279				2		2,335			15,218			317				637				1,324				1,395				3,072
Reinvested		47				1		132			1,849			17				30				69				86				140
Redeemed		(469	)			(38	)	(1,212	)		(8,454	)		(702	)			(464	)			(1,039	)			(1,506	)			(1,486	)
Net Increase (Decrease)		857				(35	)	1,255			8,613			(368	)			203				354				(25	)			1,726

Distributions:
Year Ended October 31, 2014
From net investment income		$(825)			$	(5	) $	(1,962)			$ (26,336)		$	(163)			$	(365)			$	(956)			$	(1,135)			$	(2,259	)
From net realized gain on
investments		(1,447	)			(28	)	(3,670	)		(39,028	)		(471	)			(849	)			(1,937	)			(2,065	)			(3,751	)
Total Dividends and Distributions		$(2,272)			$	(33	) $	(5,632)			$ (65,364)		$	(634)			$	(1,214)			$	(2,893)			$	(3,200)			$	(6,010	)
Year Ended October 31, 2013
From net investment income		$(572)			$	(12	) $	(1,581)			$ (22,575)		$	(200)			$	(358)			$	(842)			$	(1,049)			$	(1,701	)
From net realized gain on
investments		–				–		–			–			–				–				–				–				–
Total Dividends and Distributions		$(572)			$	(12	) $	(1,581)			$ (22,575)		$	(200)			) $	(358)			$	(842)			$	(1,049)			$	(1,701	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.




																				Principal LifeTime
Amounts in thousands																				Strategic Income Fund
																				Year Ended				Year Ended
																				October 31, 2014				October 31, 2013
Operations
Net investment income (loss)																			$			16,591		$	19,418
Net realized gain (loss) on investments																						11,937			5,920
Change in unrealized appreciation/depreciation of investments																						11,735			16,756
				Net Increase (Decrease) in Net Assets Resulting from Operations																		40,263			42,094

Dividends and Distributions to Shareholders
From net investment income																						(16,102	)		(19,423	)
													Total Dividends and Distributions									(16,102	)		(19,423	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																						6,233			(29,478	)
										Total Increase (Decrease) in Net Assets												30,394			(6,807	)

Net Assets
Beginning of period																				774,396					781,203
End of period (including undistributed net investment income as set forth below)																			$	804,790				$	774,396
Undistributed (overdistributed) net investment income (loss)																			$			7,141		$	6,652

		Class A		Class B		Class J			Institutional				R-1		R-2		R-3			R-4		R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	4,508	$	63	$	15,132			$	80,866		$	1,166	$	2,127	$	9,304	$		7,459	$	12,874
Reinvested		567		3		1,366				11,970			123		136		625			431		879
Redeemed		(5,543	)	(118	)	(13,883	)			(80,035	)		(3,449	)	(2,426	)	(14,827	)		(10,293	)	(12,792	)
Net Increase (Decrease)	$	(468	) $	(52	) $	2,615			$	12,801		$	(2,160	) $	(163	) $	(4,898	) $		(2,403	) $	961
Shares:
Sold		375		5		1,267				6,747			98		179		785			624		1,076
Reinvested		48		–		117				1,022			10		11		54			37		75
Redeemed		(458	)	(10	)	(1,165	)			(6,657	)		(288	)	(203	)	(1,248	)		(866	)	(1,064	)
Net Increase (Decrease)		(35	)	(5	)	219				1,112			(180	)	(13	)	(409	)		(205	)	87
Year Ended October 31, 2013
Dollars:
Sold	$	4,567	$	79	$	12,581			$	69,455		$	1,061	$	1,711	$	11,942	$		6,189	$	19,222
Reinvested		676		6		1,586				14,483			169		196		789			510		1,004
Redeemed		(4,774	)	(184	)	(13,746	)		(107,828		)		(2,790	)	(3,776	)	(14,051	)		(8,744	)	(19,811	)
Net Increase (Decrease)	$	469	$	(99	) $	421		$	(23,890		)	$	(1,560	) $	(1,869	) $	(1,320	) $		(2,045	) $	415
Shares:
Sold		392		7		1,090				5,991			91		148		1,043			536		1,663
Reinvested		59		1		140				1,275			15		17		70			45		88
Redeemed		(409	)	(16	)	(1,194	)			(9,313	)		(241	)	(327	)	(1,227	)		(758	)	(1,710	)
Net Increase (Decrease)		42		(8	)	36				(2,047	)		(135	)	(162	)	(114	)		(177	)	41

Distributions:
Year Ended October 31, 2014
From net investment income		$(569	) $	(3	) $	(1,366)				$ (11,970)		$	(123	) $	(136	) $	(625	) $		(431	) $	(879	)
From net realized gain on
investments		–		–		–				–			–		–		–			–		–
Total Dividends and Distributions		$(569	) $	(3	) $	(1,366)				$ (11,970)		$	(123	) $	(136	) $	(625	) $		(431	) $	(879	)
Year Ended October 31, 2013
From net investment income		$(678	) $	(6	) $	(1,588)				$ (14,483)		$	(169	) $	(196	) $	(789	) $		(510	) $	(1,004	)
From net realized gain on
investments		–		–		–				–			–		–		–			–		–
Total Dividends and Distributions		$(678	) $	(6	) $	(1,588)				$ (14,483)		$	(169	) $	(196	) $	(789	) $		(510	) $	(1,004	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.




Amounts in thousands																							SAM Balanced Portfolio
																							Year Ended								Year Ended
																							October 31, 2014								October 31, 2013
Operations
Net investment income (loss)																							$				73,498				$		70,249
Net realized gain (loss) on investments																									113,544								165,449
Change in unrealized appreciation/depreciation of investments currencies																									191,459								376,117
						Net Increase (Decrease) in Net Assets Resulting from Operations																			378,501								611,815

Dividends and Distributions to Shareholders
From net investment income																											(73,000	)					(70,865	)
From net realized gain on investments																											(72,822	)					–
														Total Dividends and Distributions											(145,822			)					(70,865	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																									186,121								100,530
											Total Increase (Decrease) in Net Assets														418,800								641,480

Net Assets
Beginning of period																									4,490,632								3,849,152
End of period (including undistributed net investment income as set forth below)																							$		4,909,432						$		4,490,632
Undistributed (overdistributed) net investment income (loss)																							$				2,226				$		1,728

		Class A				Class B		Class C			Class J		Institutional				R-1				R-2		R-3				R-4				R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	261,686			$	1,159		$ 120,962		$	169,110		$	96,268		$	1,254		$		1,478	$	12,657		$		15,752		$		32,588
Reinvested		62,117				2,654		16,315			29,781			26,562			121				269		1,957				1,741				3,074
Redeemed		(262,946	)			(47,909	)	(93,348	)		(126,093	)	(91,942		)		(1,257	)			(2,327	)	(20,783	)			(12,704	)			(12,075	)
Net Increase (Decrease)	$	60,857		$	(44,096)		$	43,929		$	72,798		$	30,888		$	118		$		(580	) $	(6,169)			$	4,789		$		23,587
Shares:
Sold		16,443				73		7,691			10,889			6,114			79				95		808				1,001				2,080
Reinvested		3,964				170		1,060			1,950			1,712			8				17		127				113				198
Redeemed		(16,540	)			(3,017	)	(5,942	)		(8,147	)		(5,805	)		(82	)			(151	)	(1,318	)			(816	)			(769	)
Net Increase (Decrease)		3,867				(2,774	)	2,809			4,692			2,021			5				(39	)	(383	)			298				1,509
Year Ended October 31, 2013
Dollars:
Sold	$	276,266			$	2,618		$ 107,154		$	189,416		$	55,691		$	793		$		4,088	$	22,463		$		20,921		$		20,789
Reinvested		30,923				1,471		6,119			14,155			14,227			58				144		800				674				1,475
Redeemed		(291,390	)			(79,592	)	(91,204	)		(115,537	)	(50,552		)		(1,294	)			(5,125	)	(9,371	)			(9,889	)			(15,761	)
Net Increase (Decrease)	$	15,799		$	(75,503		) $	22,069		$	88,034		$	19,366		$	(443)			$	(893	) $	13,892		$		11,706		$		6,503
Shares:
Sold		18,866				180		7,369			13,355			3,899			56				287		1,563				1,468				1,445
Reinvested		2,186				107		445			1,024			1,014			4				10		58				48				105
Redeemed		(20,076	)			(5,494	)	(6,346	)		(8,112	)		(3,503	)		(88	)			(357	)	(657	)			(698	)			(1,085	)
Net Increase (Decrease)		976				(5,207	)	1,468			6,267			1,410			(28	)			(60	)	964				818				465

Distributions:
Year Ended October 31, 2014
From net investment income		$ (32,032)			$	(899	) $	(6,022)			$ (15,511)			$ (14,935)		$	(50)			$	(113	) $	(920)			$	(873)			$	(1,645	)
From net realized gain on
investments		(30,837	)			(1,798	)	(10,663	)		(14,328	)	(11,635		)		(71	)			(156	)	(1,037	)			(868	)			(1,429	)
Total Dividends and Distributions		$ (62,869)			$	(2,697)		$ (16,685)			$ (29,839)			$ (26,570)		$	(121)			$	(269	) $	(1,957)			$	(1,741)			$	(3,074	)
Year Ended October 31, 2013
From net investment income		$ (31,477)				$(1,504	) $	(6,319)			$ (14,184)			$ (14,230)		$	(58)			$	(144	) $	(800)			$	(674)			$	(1,475	)
From net realized gain on
investments		–				–		–			–			–			–				–		–				–				–
Total Dividends and Distributions		$ (31,477)				$(1,504	) $	(6,319)			$ (14,184)			$ (14,230)		$	(58)			$	(144	) $	(800			) $	(674)			$	(1,475	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.




Amounts in thousands																											SAM Conservative Balanced Portfolio
																											Year Ended								Year Ended
																											October 31, 2014								October 31, 2013
Operations
Net investment income (loss)																											$				31,449				$		28,116
Net realized gain (loss) on investments																															25,559						28,358
Change in unrealized appreciation/depreciation of investments																															48,706						75,939
							Net Increase (Decrease) in Net Assets Resulting from Operations																						105,714								132,413

Dividends and Distributions to Shareholders
From net investment income																															(30,556	)					(28,358	)
From net realized gain on investments																															(28,291	)					(6,918	)
																Total Dividends and Distributions															(58,847	)					(35,276	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																													139,042								135,874
												Total Increase (Decrease) in Net Assets																	185,909								233,011

Net Assets
Beginning of period																													1,464,156								1,231,145
End of period (including undistributed net investment income as set forth below)																											$		1,650,065						$		1,464,156
Undistributed (overdistributed) net investment income (loss)																											$				2,598				$		1,705

		Class A					Class B		Class C			Class J				Institutional			R-1				R-2				R-3				R-4				R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	99,282			$		490	$	55,534		$	112,853		$		36,746		$	670		$		657		$		5,613		$		8,035		$		13,906
Reinvested		17,505					558		6,780			18,853				11,758			141				109				775				702				1,246
Redeemed		(79,948	)				(8,122	)	(36,271	)		(67,221	)			(37,028	)		(2,473	)			(1,111	)			(6,025	)			(6,011	)			(8,961	)
Net Increase (Decrease)	$	36,839			$		(7,074	) $	26,043		$	64,485		$		11,476		$	(1,662)			$	(345)			$	363		$		2,726		$		6,191
Shares:
Sold		8,171					40		4,613			9,384				3,051			56				54				470				664				1,159
Reinvested		1,459					47		572			1,587				987			12				9				65				59				105
Redeemed		(6,583	)				(668	)	(3,009	)		(5,582	)			(3,072	)		(210	)			(92	)			(500	)			(504	)			(747	)
Net Increase (Decrease)		3,047					(581	)	2,176			5,389				966			(142	)			(29	)			35				219				517
Year Ended October 31, 2013
Dollars:
Sold	$	99,657			$		834	$	43,480		$	136,081		$		30,645		$	991		$		1,574		$		5,957		$		8,210		$		13,512
Reinvested		10,691					540		3,646			10,659				7,636			95				59				530				358				623
Redeemed		(82,533	)				(15,893	)	(30,963	)		(65,221	)			(24,432	)		(720	)			(1,327	)			(9,939	)			(3,655	)			(5,221	)
Net Increase (Decrease)	$	27,815		$	(14,519			) $	16,163		$	81,519		$		13,849		$	366		$		306		$		(3,452)			$	4,913		$		8,914
Shares:
Sold		8,600					73		3,781			11,900				2,675			88				137				519				721				1,175
Reinvested		939					48		324			945				675			8				5				47				32				55
Redeemed		(7,133	)				(1,376	)	(2,698	)		(5,696	)			(2,126	)		(62	)			(117	)			(875	)			(321	)			(451	)
Net Increase (Decrease)		2,406					(1,255	)	1,407			7,149				1,224			34				25				(309	)			432				779

Distributions:
Year Ended October 31, 2014
From net investment income		$(9,323)				$	(210	) $	(2,871)			$ (10,067)		$		(6,567	)	$	(56)			$	(49)			$	(382)			$	(356)			$	(675	)
From net realized gain on
investments		(8,431	)				(367	)	(4,049	)		(8,797	)			(5,192	)		(85	)			(60	)			(393	)			(346	)			(571	)
Total Dividends and Distributions		$ (17,754)				$	(577	) $	(6,920)			$ (18,864)				$ (11,759)		$	(141)			$	(109)			$	(775)			$	(702)			$	(1,246	)
Year Ended October 31, 2013
From net investment income		$(8,836)				$	(386	) $	(2,792)			$ (8,690)		$		(6,316	)	$	(72)			$	(47)			$	(409)			$	(294)			$	(516	)
From net realized gain on
investments		(2,115	)				(173	)	(1,002	)		(1,981	)			(1,320	)		(23	)			(12	)			(121	)			(64	)			(107	)
Total Dividends and Distributions		$ (10,951)				$	(559	) $	(3,794)		$	(10,671)			$	(7,636	)	$	(95)			$	(59)			$	(530)			$	(358)			$	(623	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.




Amounts in thousands																									SAM Conservative Growth Portfolio
																									Year Ended								Year Ended
																									October 31, 2014								October 31, 2013
Operations
Net investment income (loss)																									$				34,716				$		34,212
Net realized gain (loss) on investments																											102,217								128,546
Change in unrealized appreciation/depreciation of investments																											157,107								357,370
						Net Increase (Decrease) in Net Assets Resulting from Operations																					294,040								520,128

Dividends and Distributions to Shareholders
From net investment income																													(37,744	)					(37,712	)
From net realized gain on investments																													(26,302	)					–
																Total Dividends and Distributions													(64,046	)					(37,712	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																													32,336						(28,259	)
												Total Increase (Decrease) in Net Assets															262,330								454,157

Net Assets
Beginning of period																											3,010,389								2,556,232
End of period (including undistributed net investment income as set forth below)																									$		3,272,719						$		3,010,389
Undistributed (overdistributed) net investment income (loss)																									$				2,713				$		5,741

		Class A				Class B		Class C				Class J				Institutional			R-1		R-2				R-3				R-4				R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	168,703			$	782	$	63,476		$		90,413		$		42,885		$	1,178	$	1,227		$		5,477		$		6,638		$		20,443
Reinvested		29,395				887		7,886				9,814				12,404			68		148				576				514				1,605
Redeemed		(182,989	)			(38,774	)	(68,382	)			(59,775	)			(54,227	)		(1,479	)	(1,801	)			(8,136	)			(6,004	)			(10,616	)
Net Increase (Decrease)	$	15,109		$	(37,105		) $	2,980		$		40,452		$		1,062		$	(233	) $	(426)			$	(2,083)			$	1,148		$		11,432
Shares:
Sold		9,317				44		3,697				5,127				2,390			66		70				311				374				1,155
Reinvested		1,656				52		470				568				710			4		8				34				30				93
Redeemed		(10,096	)			(2,206	)	(3,982	)			(3,383	)			(3,024	)		(85	)	(103	)			(460	)			(341	)			(595	)
Net Increase (Decrease)		877				(2,110	)	185				2,312				76			(15	)	(25	)			(115	)			63				653
Year Ended October 31, 2013
Dollars:
Sold	$	161,724			$	1,779	$	51,327		$		93,614		$		36,844		$	712	$	2,988		$		9,448		$		7,669		$		14,438
Reinvested		17,968				542		3,838				5,397				7,934			44		70				263				246				872
Redeemed		(202,515	)			(65,140	)	(70,455	)			(53,848	)			(36,049	)		(909	)	(1,840	)			(4,652	)			(5,020	)			(5,548	)
Net Increase (Decrease)	$	(22,823)				$ (62,819)		$ (15,290)		$		45,163		$		8,729		$	(153	) $	1,218		$		5,059		$		2,895		$		9,762
Shares:
Sold		10,074				117		3,354				6,008				2,345			46		192				603				487				917
Reinvested		1,212				38		272				374				545			3		5				18				17				60
Redeemed		(12,749	)			(4,236	)	(4,664	)			(3,464	)			(2,287	)		(58	)	(118	)			(302	)			(327	)			(356	)
Net Increase (Decrease)		(1,463	)			(4,081	)	(1,038	)			2,918				603			(9	)	79				319				177				621

Distributions:
Year Ended October 31, 2014
From net investment income		$ (18,085)			$	(145	) $	(3,539)			$	(6,053)			$	(8,160	)	$	(32	) $	(78)			$	(333)			$	(315)			$	(1,004	)
From net realized gain on
investments		(11,765	)			(755	)	(4,616	)			(3,769	)			(4,248	)		(36	)	(70	)			(243	)			(199	)			(601	)
Total Dividends and Distributions		$ (29,850)				$(900	) $	(8,155)			$	(9,822)				$ (12,408)		$	(68	) $	(148)			$	(576)			$	(514)			$	(1,605	)
Year Ended October 31, 2013
From net investment income		$ (18,292)				$(553	) $	(4,028)			$	(5,407)			$	(7,937	)	$	(44	) $	(70)			$	(263)			$	(246)			$	(872	)
From net realized gain on
investments		–				–		–				–				–			–		–				–				–				–
Total Dividends and Distributions		$ (18,292)			$	(553	) $	(4,028)			$	(5,407)			$	(7,937	)	$	(44	) $	(70)			$	(263)			$	(246)			$	(872	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.




Amounts in thousands																							SAM Flexible Income Portfolio
																							Year Ended								Year Ended
																							October 31, 2014								October 31, 2013
Operations
Net investment income (loss)																							$				47,777				$		43,694
Net realized gain (loss) on investments																											21,207						28,471
Change in unrealized appreciation/depreciation of investments																											48,443						39,722
						Net Increase (Decrease) in Net Assets Resulting from Operations																			117,427								111,887

Dividends and Distributions to Shareholders
From net investment income																											(47,578	)					(44,976	)
From net realized gain on investments																											(27,718	)					(14,282	)
														Total Dividends and Distributions													(75,296	)					(59,258	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																									218,348								257,434
											Total Increase (Decrease) in Net Assets														260,479								310,063

Net Assets
Beginning of period																									1,809,607								1,499,544
End of period (including undistributed net investment income as set forth below)																							$		2,070,086						$		1,809,607
Undistributed (overdistributed) net investment income (loss)																							$				199				$		–

		Class A				Class B		Class C			Class J			Institutional			R-1				R-2		R-3				R-4				R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	174,672			$	565	$	90,762		$	192,986		$	21,324		$	275		$		294	$	3,483		$		3,379		$		5,942
Reinvested		29,655				665		8,890			25,926			7,754			29				50		414				491				762
Redeemed		(146,495	)			(9,495	)	(53,794	)		(99,032	)		(27,335	)		(621	)			(912	)	(4,206	)			(4,459	)			(3,621	)
Net Increase (Decrease)	$	57,832			$	(8,265	) $	45,858		$	119,880		$	1,743		$	(317)			$	(568	) $	(309)			$	(589)			$	3,083
Shares:
Sold		14,011				46		7,346			15,592			1,713			22				24		282				271				480
Reinvested		2,400				54		727			2,112			629			2				4		34				40				62
Redeemed		(11,767	)			(763	)	(4,359	)		(8,016	)		(2,200	)		(50	)			(75	)	(339	)			(361	)			(292	)
Net Increase (Decrease)		4,644				(663	)	3,714			9,688			142			(26	)			(47	)	(23	)			(50	)			250
Year Ended October 31, 2013
Dollars:
Sold	$	213,657			$	1,870	$	75,620		$	215,263		$	27,076		$	438		$		867	$	3,652		$		7,675		$		5,829
Reinvested		24,033				920		6,898			18,394			6,955			32				60		334				363				560
Redeemed		(152,730	)			(18,382	)	(55,283	)		(84,117	)		(33,138	)		(278	)			(1,063	)	(2,577	)			(2,941	)			(2,553	)
Net Increase (Decrease)	$	84,960		$	(15,592		) $	27,235		$	149,540		$	893		$	192		$		(136	) $	1,409		$		5,097		$		3,836
Shares:
Sold		17,627				155		6,287			17,883			2,236			36				72		303				640				483
Reinvested		1,996				77		578			1,537			579			3				5		28				30				47
Redeemed		(12,609	)			(1,517	)	(4,598	)		(6,989	)		(2,743	)		(23	)			(88	)	(214	)			(245	)			(212	)
Net Increase (Decrease)		7,014				(1,285	)	2,267			12,431			72			16				(11	)	117				425				318

Distributions:
Year Ended October 31, 2014
From net investment income		$ (19,103)				$(327)	$	(5,071)			$ (16,886)			$ (5,102	)	$	(16)			$	(29	) $	(250)			$	(298)			$	(496	)
From net realized gain on
investments		(10,979	)			(350	)	(3,972	)		(9,106	)		(2,654	)		(13	)			(21	)	(164	)			(193	)			(266	)
Total Dividends and Distributions		$ (30,082)				$(677)	$	(9,043)			$ (25,992)		$	(7,756	)	$	(29)			$	(50	) $	(414)			$	(491)			$	(762	)
Year Ended October 31, 2013
From net investment income		$ (18,678)				$(591)	$	(4,957)			$ (14,321)		$	(5,388	)	$	(23)			$	(44	) $	(250)			$	(292)			$	(432	)
From net realized gain on
investments		(5,809	)			(349	)	(2,134	)		(4,113	)		(1,569	)		(9	)			(16	)	(84	)			(71	)			(128	)
Total Dividends and Distributions		$ (24,487)				$(940	$	(7,091)			$ (18,434)		$	(6,957	)	$	(32)			$	(60	) $	(334)			$	(363)			$	(560	)


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.




Amounts in thousands																									SAM Strategic Growth Portfolio
																									Year Ended								Year Ended
																									October 31, 2014								October 31, 2013
Operations
Net investment income (loss)																									$				17,813				$		16,510
Net realized gain (loss) on investments																													94,122						121,311
Change in unrealized appreciation/depreciation of investments																													97,180						240,577
						Net Increase (Decrease) in Net Assets Resulting from Operations																					209,115								378,398

Dividends and Distributions to Shareholders
From net investment income																													(19,180	)					(17,084	)
From net realized gain on investments																													(13,887	)					–
														Total Dividends and Distributions															(33,067	)					(17,084	)

Capital Share Transactions
Net increase (decrease) in capital share transactions																													(48,943	)					(42,941	)
										Total Increase (Decrease) in Net Assets																	127,105								318,373

Net Assets
Beginning of period																											1,886,072								1,567,699
End of period (including undistributed net investment income as set forth below)																									$		2,013,177						$		1,886,072
Undistributed (overdistributed) net investment income (loss)																									$				5,432				$		6,799

				Class A		Class B		Class C		Class J				Institutional			R-1				R-2				R-3				R-4				R-5
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	100,668			$	585	$	35,497	$	39,944		$		26,851		$	1,080		$		1,004		$		3,297		$		6,294		$		9,810
Reinvested				16,489		521		3,857		4,922				5,586			57				69				342				295				567
Redeemed		(136,073			)	(29,695	)	(52,474	)	(38,730	)			(31,193	)		(1,454	)			(988	)			(6,841	)			(3,139	)			(6,091	)
Net Increase (Decrease)	$	(18,916)				$ (28,589)		$ (13,120)	$	6,136		$		1,244		$	(317)			$	85		$		(3,202)			$	3,450		$		4,286
Shares:
Sold				4,845		31		1,826		1,972				1,304			55				50				161				308				484
Reinvested				811		27		204		248				280			3				3				17				15				28
Redeemed				(6,537	)	(1,519	)	(2,699	)	(1,909	)			(1,517	)		(74	)			(49	)			(337	)			(155	)			(298	)
Net Increase (Decrease)				(881	)	(1,461	)	(669	)	311				67			(16	)			4				(159	)			168				214
Year Ended October 31, 2013
Dollars:
Sold	$	102,373			$	764	$	27,899	$	51,820		$		27,102		$	825		$		1,630		$		6,389		$		10,698		$		7,115
Reinvested				9,063		106		1,426		2,452				3,223			26				23				153				90				281
Redeemed		(134,287			)	(47,107	)	(47,102	)	(31,949	)			(22,315	)		(304	)			(688	)			(4,335	)			(4,977	)			(3,335	)
Net Increase (Decrease)	$	(22,851)				$ (46,237)		$ (17,777)	$	22,323		$		8,010		$	547		$		965		$		2,207		$		5,811		$		4,061
Shares:
Sold				5,716		45		1,648		2,961				1,531			49				95				369				628				402
Reinvested				554		7		93		154				201			2				1				10				6				18
Redeemed				(7,574	)	(2,825	)	(2,823	)	(1,837	)			(1,281	)		(18	)			(40	)			(256	)			(282	)			(196	)
Net Increase (Decrease)				(1,304	)	(2,773	)	(1,082	)	1,278				451			33				56				123				352				224

Distributions:
Year Ended October 31, 2014
From net investment income		$		(10,062)		$(21	) $	(1,523	) $	(3,040)			$	(3,734	)	$	(27)			$	(37)			$	(197)			$	(180)			$	(359	)
From net realized gain on
investments				(6,646	)	(507	)	(2,450	)	(1,884	)			(1,870	)		(30	)			(32	)			(145	)			(115	)			(208	)
Total Dividends and Distributions			$	(16,708)		$(528	) $	(3,973	) $	(4,924)			$	(5,604	)	$	(57)			$	(69)			$	(342)			$	(295)			$	(567	)
Year Ended October 31, 2013
From net investment income				$(9,213	) $	(108	) $	(1,508	) $	(2,452)			$	(3,230	)	$	(26)			$	(23)			$	(153)			$	(90)			$	(281	)
From net realized gain on
investments				–		–		–		–				–			–				–				–				–				–
Total Dividends and Distributions				$(9,213	) $	(108	) $	(1,508	) $	(2,452)			$	(3,230	)	$	(26)			$	(23)			$	(153)			$	(90)			$	(281	)

Principal Funds, Inc. (the "Fund") is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company and operates as a series fund in the mutual fund industry. The financial statements for Principal LifeTime 2010 Fund, Principal LifeTime 2020 Fund, Principal LifeTime 2030 Fund, Principal LifeTime 2040 Fund, Principal LifeTime 2050 Fund, Principal LifeTime Strategic Income Fund (collectively, the “Principal LifeTime Funds”), SAM Balanced Portfolio, SAM Conservative Balanced Portfolio, SAM Conservative Growth Portfolio, SAM Flexible Income Portfolio, and SAM Strategic Growth Portfolio (collectively, the “SAM Portfolios”) (known as the "Funds") are presented herein. The Funds may offer up to nine classes of shares: Class A, Class C, Class J, Institutional, R-1, R-2, R-3, R-4, and R-5. Class B shares of the Funds are no longer available for purchase. Information presented in these financial statements pertains to the Class A, Class B, and Class C shares. Certain detailed financial information for the Class J, Institutional, R-1, R-2, R-3, R-4, and R-5 classes of shares is provided separately.

Security Valuation. The Funds invest in Institutional Class shares of other series of Principal Funds, Inc. (the "Underlying Funds"). Investments in the Underlying Funds are valued at the closing net asset value per share of each Underlying Fund on the day of valuation.

Income and Investment Transactions. The Funds record investment transactions on a trade date basis. The identified cost basis has been used in determining the net realized gain or loss from investment transactions and unrealized appreciation or depreciation of investments. The Funds record dividend income on the ex-dividend date. The Funds allocate daily all income and realized and unrealized gains or losses to each class of shares based upon the relative proportion of the value of shares outstanding of each class.

Expenses. Expenses directly attributed to a particular fund are charged to that fund. Other fund expenses not directly attributed to a particular fund are apportioned among the registered investment companies managed by Principal Management Corporation (the “Manager”).

In addition to the expenses that each of the Funds bears directly, each of the Funds indirectly bears a pro rata share of the fees and expenses of the Underlying Funds in which they invest. Because the Underlying Funds have varied expense levels and each of the Funds may own different proportions of Underlying Funds at different times, the amount of expense incurred indirectly by each of the Funds will vary. Management fees are allocated daily to each class of shares based upon the relative proportion of the value of shares outstanding of each class. Expenses specifically attributable to a particular class are charged directly to such class and are included separately in the statements of operations. Expenses included in the statements of operations of the Funds reflect the expenses of each of the Funds and do not include any expenses associated with the Underlying Funds.

Distributions to Shareholders. Dividends and distributions to shareholders of the Funds are recorded on the ex-dividend date. Dividends and distributions to shareholders from net investment income and net realized gain from investments are determined in accordance with federal tax regulations, which may differ from U.S. generally accepted accounting principles. These differences are primarily due to differing treatments for losses deferred due to wash sales. Permanent book and tax basis differences are reclassified within the capital accounts based on federal tax-basis treatment; temporary differences do not require reclassification. To the extent dividends and distributions exceed current and accumulated earnings and profits for federal income tax purposes, they are reported as return of capital distributions.

The Funds participate with other registered investment companies managed by the Manager in an unsecured joint line of credit with a bank which allows the participants to borrow up to $75 million, collectively. Borrowings are made solely to facilitate the handling of unusual and/or unanticipated short-term cash requirements. Interest is charged to each participant, based on its borrowings, at a rate equal to the higher of the Fed Funds Rate or LIBOR Rate plus 1.00%. Additionally, a commitment fee is charged at an annual rate of .08% on the amount of the line of credit. The Funds did not borrow against the line of credit during the year ended October 31, 2014.

The three-tier hierarchy of inputs is summarized in the three broad levels listed below.

The beginning of the period timing recognition has been adopted for the significant transfers between levels of each Fund’s assets and liabilities. As of October 31, 2014 there were no transfers between Level 1 and Level 2 and 100% of the Funds’ investments were valued based on Level 1 inputs.

Management Services. The Funds have agreed to pay investment advisory and management fees to Principal Management Corporation (wholly owned by Principal Financial Services, Inc.). A portion of the management fee is paid by Principal Management Corporation to the sub-advisor of each of the Funds, which are affiliates of the Manager. The annual rate paid by each of the Principal LifeTime Funds is 0.03% of each of the Principal LifeTime Funds’ average net assets. The annual rate paid by the SAM Portfolios is based upon the aggregate average daily net assets (“aggregate net assets”) of the SAM Portfolios. The investment advisory and management fee schedule for the SAM Portfolios is .55% of aggregate net assets up to $500 million, .50% of the next $500 million of aggregate net assets, .45% of the next $1 billion of aggregate net assets, .40% of the next $1 billion of aggregate net assets, .35% of the next $1 billion of aggregate net assets, .30% of the next $1 billion of aggregate net assets, .25% of the next $9 billion of aggregate net assets, and .20% of aggregate net assets over $14 billion.

In addition to the management fee, R-1, R-2, R-3, R-4, and R-5 classes of shares of the Funds pay the Manager a service fee and an administrative service fee computed at an annual percentage rate of each class’s average daily net assets. The annual rates for the service fee are .25%, .25%, .25%, .25%, and .25% and the annual rates for the administrative service fee are .28%, .20%, .07%, .03%, and .01% for R-1, R-2, R-3, R-4, and R-5, respectively. Class A, Class B, Class C, and Institutional shares of the Funds reimburse Principal Shareholder Services, Inc. (the “Transfer Agent”) (wholly owned by the Manager) for transfer agent services.

Amounts owed to the Funds under the terms of the expense limitation agreements are reflected in the statement of assets and liabilities as expense reimbursement from Manager.

Distribution Fees. The Class A, Class B, Class C, Class J, R-1, R-2, R-3, and R-4 shares of the Funds bear distribution fees. The fee is computed at an annual rate of the average daily net assets attributable to each class of each of the Funds. Distribution fees are paid to Principal Funds Distributor, Inc. (the "Distributor"), the principal distributor of the Funds. A portion of the distribution fees may be paid to other selling dealers for providing certain services. The annual rates are .25%, 1.00%, 1.00%, .25%, .35%, .30%, .25%, and .10% for Class A, Class B, Class C, Class J, R-1, R-2, R-3 and R-4 classes of shares, respectively. Prior to December 30, 2013, the annual rate for Class J was .45%.

Effective December 30, 2013, the Distributor has contractually agreed to limit the distribution fees (expressed as a percentage of average net assets on an annualized basis) attributable to Class J shares through February 28, 2015. The limit will maintain the level of distribution fees not to exceed 0.24%. Prior to December 30, 2013, the limit was 0.25% for Class J shares.

Amounts owed to the Funds under the terms of the expense limitation agreements are reflected in the statement of assets and liabilities as expense reimbursement from Distributor.

Sales Charges. Principal Funds Distributor, Inc., as the principal distributor, receives proceeds of any CDSC on certain Class A, Class B, Class C, and Class J share redemptions. The charge for Class A shares is 1.00% of the lesser of current market value or the cost of shares redeemed within 12 months of purchase that were originally sold without a sales charge. The charge for Class B shares is based on declining rates which begin at 5.00% of the lesser of current market value or the cost of shares being redeemed within 24 months of purchase. After 24 months, the rate declines and is eliminated after 5 years. The charge for Class C shares is 1.00% of the lesser of current market value or the cost of shares redeemed within 12 months of purchase. The charge for Class J shares is 1.00% of the lesser of current market value or the cost of shares redeemed within 18 months of purchase. Principal Funds Distributor, Inc. also retains sales charges on sales of Class A shares based on declining rates which begin at 3.75% for Principal LifeTime 2010 Fund, Principal LifeTime Strategic Income Fund, and SAM Flexible Income Portfolio and 5.50% for all other Funds. The aggregate amounts of these charges retained by Principal Funds Distributor, Inc. for the year ended October 31, 2014, were as follows (in thousands):

Class B shares automatically convert into Class A shares, based on relative net asset value (without a sales charge), eight years after purchase.

The following table reflects the conversion of Class B shares into Class A shares (reflected in the statement of changes in net assets as Class B shares and dollars redeemed and as Class A dollars sold) for the year ended October 31, 2014(amounts in thousands).

Distributions to Shareholders. The federal income tax character of distributions paid for the years ended October 31, 2014 and October 31, 2013 were as follows (amounts in thousands):

* The funds designate these distributions as long-term capital gain dividends per IRC Sec. 852(b)(3)(C).

For U.S. federal income tax purposes, short-term capital gain distributions are considered ordinary income distributions.

Distributable Earnings. As of October 31, 2014, the components of distributable earnings/(deficit) on a federal tax basis were as follows (amounts in thousands):

Capital Loss Carryforwards. Capital loss carryforwards are losses that can be used to offset future capital gain of the Funds. At October 31, 2014, the Funds had approximate net capital loss carryforwards as follows (amounts in thousands):

As of October 31, 2014, the following funds utilized capital loss carryforwards as follows (amounts in thousands):


				Schedule of Investments
				Principal LifeTime 2010 Fund
				October 31, 2014

INVESTMENT COMPANIES - 100.11%	Shares Held		Value	(000	's)

Principal Funds, Inc. Institutional Class - 100.11%
Bond & Mortgage Securities Fund ^(a)	28,992,665	$		317,760
Core Plus Bond Fund I ^(a)	16,575,093			186,304
Diversified International Fund ^(a)	6,230,260			74,389
Diversified Real Asset Fund ^(a)	4,946,391			62,869
Equity Income Fund ^(a)	3,189,866			83,893
Global Diversified Income Fund ^(a)	5,755,257			84,660
Global Multi-Strategy Fund ^(a)	4,052,842			44,987
Global Opportunities Fund ^(a)	2,111,906			27,582
High Yield Fund I ^(a)	4,312,910			45,242
Inflation Protection Fund ^(a)	9,770,709			84,614
International Emerging Markets Fund ^(a)	958,038			23,836
LargeCap Growth Fund I ^(a)	7,295,056			99,140
LargeCap S&P 500 Index Fund ^(a)	4,327,759			62,103
LargeCap Value Fund ^(a)	2,633,407			36,604
LargeCap Value Fund III ^(a)	3,801,692			59,877
MidCap Fund ^(a)	3,215,649			71,805
Overseas Fund ^(a)	6,286,816			72,361
Short-Term Income Fund ^(a)	15,008,224			183,551
SmallCap Growth Fund I ^(a)	1,638,223			23,017
SmallCap Value Fund II ^(a)	1,784,867			25,167
		$		1,669,761
TOTAL INVESTMENT COMPANIES		$		1,669,761
Total Investments		$		1,669,761
Liabilities in Excess of Other Assets, Net - (0.11)%		$		(1,880	)
TOTAL NET ASSETS - 100.00%		$		1,667,881


Schedule of Investments
Principal LifeTime 2010 Fund
October 31, 2014
	October 31,		October 31,								October 31,		October 31,
Affiliated Securities	2013		2013	Purchases		Purchases	Sales			Sales	2014		2014
	Shares		Cost	Shares		Cost	Shares			Proceeds	Shares		Cost
Bond & Mortgage Securities Fund	16,912,575	$	182,662	14,175,759	$	155,124	2,095,669		$	22,823	28,992,665	$	314,975
Bond Market Index Fund	13,572,181		144,920	2,624,593		28,123	16,196,774			177,056	—		—
Core Plus Bond Fund I	16,352,593		172,513	2,190,559		24,121	1,968,059			21,851	16,575,093		174,845
Diversified International Fund	6,493,839		92,839	437,696		5,237	701,275			8,394	6,230,260		89,638
Diversified Real Asset Fund	5,171,451		53,431	380,738		4,755	605,798			7,609	4,946,391		50,972
Equity Income Fund	3,679,519		69,686	239,093		6,023	728,746			18,226	3,189,866		60,294
Global Diversified Income Fund	5,866,439		66,580	560,241		8,163	671,423			9,773	5,755,257		65,182
Global Multi-Strategy Fund	4,303,645		44,480	283,798		3,111	534,601			5,848	4,052,842		41,834
Global Opportunities Fund	2,472,329		26,927	115,186		1,466	475,609			5,950	2,111,906		22,881
High Yield Fund I	4,279,682		41,131	556,450		5,896	523,222			5,562	4,312,910		41,486
Inflation Protection Fund	8,790,610		71,070	2,165,933		18,466	1,185,834			10,219	9,770,709		79,378
International Emerging Markets Fund	1,007,764		28,102	53,058		1,321	102,784			2,522	958,038		26,831
LargeCap Growth Fund I	8,622,634		67,544	897,708		11,350	2,225,286			28,298	7,295,056		56,778
LargeCap S&P 500 Index Fund	5,668,763		57,683	326,966		4,363	1,667,970			22,184	4,327,759		42,994
LargeCap Value Fund	2,873,977		26,210	426,758		5,547	667,328			8,805	2,633,407		22,998
LargeCap Value Fund I	1,521,332		12,435	—		—	1,521,332			22,229	—		—
LargeCap Value Fund III	3,160,600		42,130	1,790,893		25,182	1,149,801			17,224	3,801,692		50,981
MidCap Fund	4,050,778		59,871	247,820		5,161	1,082,949			22,349	3,215,649		47,500
Overseas Fund	6,656,662		59,777	758,648		8,872	1,128,494			13,324	6,286,816		56,326
Short-Term Income Fund	10,446,363		125,420	5,974,399		73,089	1,412,538			17,295	15,008,224		181,265
SmallCap Growth Fund I	1,682,299		16,540	256,925		3,547	301,001			4,212	1,638,223		15,916
SmallCap Value Fund II	1,751,880		13,558	193,744		2,629	160,757			2,212	1,784,867		14,099
		$	1,475,509	$		401,546			$	453,965		$	1,457,173


						Realized Gain/Loss					Realized Gain from
			Income			on Investments				Capital Gain Distributions
Bond & Mortgage Securities Fund	$		5,756	$			12			$			—
Bond Market Index Fund			3,363				4,013						—
Core Plus Bond Fund I			4,349				62						—
Diversified International Fund			1,505				(44	)					—
Diversified Real Asset Fund			1,172				395						195
Equity Income Fund			1,915				2,811						—
Global Diversified Income Fund			3,809				212						—
Global Multi-Strategy Fund			299				91						199
Global Opportunities Fund			171				438						—
High Yield Fund I			2,785				21						606
Inflation Protection Fund			163				61						1,206
International Emerging Markets Fund			207				(70	)					—
LargeCap Growth Fund I			627				6,182						6,161
LargeCap S&P 500 Index Fund			1,193				3,132						—
LargeCap Value Fund			1,384				46						2,469
LargeCap Value Fund I			—				9,794						—
LargeCap Value Fund III			423				893						—
MidCap Fund			476				4,817						1,436
Overseas Fund			2,182				1,001						2,994
Short-Term Income Fund			2,357				51						68
SmallCap Growth Fund I			382				41						2,186
SmallCap Value Fund II			117				124						1,532
	$		34,635	$			34,083			$			19,052
Amounts in thousands except shares


				Schedule of Investments
				Principal LifeTime 2020 Fund
				October 31, 2014


INVESTMENT COMPANIES - 100.16%	Shares Held		Value	(000	's)

Principal Funds, Inc. Institutional Class - 100.16%
Bond & Mortgage Securities Fund ^(a)	90,707,453	$		994,154
Core Plus Bond Fund I ^(a)	56,260,713			632,370
Diversified International Fund ^(a)	32,751,125			391,048
Diversified Real Asset Fund ^(a)	15,459,195			196,486
Equity Income Fund ^(a)	8,288,809			217,996
Global Diversified Income Fund ^(a)	10,039,151			147,676
Global Multi-Strategy Fund ^(a)	16,508,779			183,248
Global Opportunities Fund ^(a)	25,668,932			335,236
Global Real Estate Securities Fund ^(a)	24,081,750			222,997
High Yield Fund I ^(a)	12,582,832			131,994
Inflation Protection Fund ^(a)	25,995,825			225,124
International Emerging Markets Fund ^(a)	7,108,177			176,852
LargeCap Growth Fund I ^(a)	45,172,084			613,889
LargeCap S&P 500 Index Fund ^(a)	29,228,723			419,432
LargeCap Value Fund ^(a)	21,506,209			298,936
LargeCap Value Fund III ^(a)	30,849,069			485,873
MidCap Fund ^(a)	4,815,200			107,523
MidCap Growth Fund III ^(a)	10,729,167			136,475
MidCap Value Fund III ^(a)	6,734,334			138,727
Overseas Fund ^(a)	34,299,506			394,787
Short-Term Income Fund ^(a)	19,227,454			235,152
SmallCap Growth Fund I ^(a)	8,490,984			119,298
SmallCap Value Fund II ^(a)	9,073,018			127,930
		$		6,933,203
TOTAL INVESTMENT COMPANIES		$		6,933,203
Total Investments		$		6,933,203
Liabilities in Excess of Other Assets, Net - (0.16)%		$		(11,362	)
TOTAL NET ASSETS - 100.00%		$		6,921,841


Schedule of Investments
Principal LifeTime 2020 Fund
October 31, 2014


	October 31,		October 31,								October 31,		October 31,
Affiliated Securities	2013		2013	Purchases		Purchases	Sales			Sales	2014		2014
	Shares		Cost	Shares		Cost	Shares			Proceeds	Shares		Cost
Bond & Mortgage Securities Fund	52,579,398	$	565,913	41,325,957	$	452,689	3,197,902		$	34,825	90,707,453	$	983,777
Bond Market Index Fund	41,552,382		445,636	3,107,883		33,308	44,660,265			488,684	—		—
Core Plus Bond Fund I	50,769,311		547,303	8,249,272		90,925	2,757,870			30,609	56,260,713		607,618
Diversified International Fund	31,930,860		433,450	2,331,490		27,900	1,511,225			18,141	32,751,125		443,284
Diversified Real Asset Fund	15,027,484		159,865	1,226,956		15,284	795,245			9,988	15,459,195		165,194
Equity Income Fund	8,462,241		161,328	623,413		15,621	796,845			19,665	8,288,809		158,464
Global Diversified Income Fund	9,518,879		129,226	1,074,981		15,651	554,709			8,078	10,039,151		136,803
Global Multi-Strategy Fund	14,533,042		150,772	2,835,840		30,892	860,103			9,416	16,508,779		172,267
Global Opportunities Fund	25,390,298		275,752	1,445,731		18,305	1,167,097			14,748	25,668,932		279,427
Global Real Estate Securities Fund	24,907,807		186,296	2,511,021		21,206	3,337,078			28,554	24,081,750		179,969
High Yield Fund I	8,924,950		82,828	4,226,494		45,047	568,612			6,044	12,582,832		121,828
Inflation Protection Fund	19,586,956		171,798	7,633,075		65,173	1,224,206			10,555	25,995,825		226,409
International Emerging Markets Fund	7,000,056		176,724	490,765		12,066	382,644			9,443	7,108,177		179,346
LargeCap Growth Fund	2,424,277		12,405	281,651		3,019	2,705,928			28,453	—		—
LargeCap Growth Fund I	47,160,911		371,702	5,333,051		67,380	7,321,878			91,756	45,172,084		353,584
LargeCap S&P 500 Index Fund	34,168,839		320,469	2,215,594		29,341	7,155,710			94,731	29,228,723		266,001
LargeCap Value Fund	20,738,807		194,620	3,329,860		43,251	2,562,458			33,532	21,506,209		204,438
LargeCap Value Fund I	10,713,324		94,740	—		—	10,713,324			156,544	—		—
LargeCap Value Fund III	21,906,090		292,443	12,930,250		181,803	3,987,271			59,599	30,849,069		416,940
MidCap Fund	4,678,112		68,697	352,136		7,313	215,048			4,510	4,815,200		71,565
MidCap Growth Fund III	9,533,764		82,078	2,509,535		30,073	1,314,132			15,899	10,729,167		96,320
MidCap Value Fund III	6,943,009		111,099	616,120		11,943	824,795			16,011	6,734,334		107,898
Overseas Fund	31,944,994		299,649	3,879,095		45,453	1,524,583			18,143	34,299,506		327,041
Short-Term Income Fund	—		—	19,590,700		239,613	363,246			4,447	19,227,454		235,166
SmallCap Growth Fund I	8,394,378		79,228	1,329,475		18,408	1,232,869			16,933	8,490,984		80,810
SmallCap Value Fund II	9,261,764		72,384	1,063,486		14,443	1,252,232			17,044	9,073,018		71,023
		$	5,486,405	$		1,536,107			$	1,246,352		$	5,885,172


						Realized Gain/Loss					Realized Gain from
			Income			on Investments				Capital Gain Distributions
Bond & Mortgage Securities Fund	$		18,545	$			—			$			—
Bond Market Index Fund			10,411				9,740						—
Core Plus Bond Fund I			13,631				(1	)					—
Diversified International Fund			7,465				75						—
Diversified Real Asset Fund			3,437				33						572
Equity Income Fund			4,710				1,180						—
Global Diversified Income Fund			6,434				4						—
Global Multi-Strategy Fund			1,018				19						678
Global Opportunities Fund			1,769				118						—
Global Real Estate Securities Fund			8,968				1,021						2,808
High Yield Fund I			6,946				(3	)					1,272
Inflation Protection Fund			367				(7	)					2,710
International Emerging Markets Fund			1,451				(1	)					—
LargeCap Growth Fund			92				13,029						2,927
LargeCap Growth Fund I			3,449				6,258						33,905
LargeCap S&P 500 Index Fund			7,248				10,922						—
LargeCap Value Fund			10,052				99						17,923
LargeCap Value Fund I			—				61,804						—
LargeCap Value Fund III			2,974				2,293						—
MidCap Fund			553				65						1,668
MidCap Growth Fund III			7,485				68						15,973
MidCap Value Fund III			2,437				867						2,743
Overseas Fund			10,553				82						14,464
Short-Term Income Fund			967				—						—
SmallCap Growth Fund I			1,916				107						10,968
SmallCap Value Fund II			625				1,240						8,146
	$		133,503	$			109,012			$			116,757
Amounts in thousands except shares


				Schedule of Investments
				Principal LifeTime 2030 Fund
				October 31, 2014


INVESTMENT COMPANIES - 100.15%	Shares Held		Value	(000	's)

Principal Funds, Inc. Institutional Class - 100.15%
Bond & Mortgage Securities Fund ^(a)	72,026,557	$		789,411
Core Plus Bond Fund I ^(a)	30,575,625			343,670
Diversified International Fund ^(a)	38,547,017			460,251
Diversified Real Asset Fund ^(a)	12,908,360			164,065
Global Multi-Strategy Fund ^(a)	17,039,127			189,134
Global Opportunities Fund ^(a)	26,269,818			343,084
Global Real Estate Securities Fund ^(a)	36,178,638			335,014
High Yield Fund I ^(a)	12,677,933			132,992
Inflation Protection Fund ^(a)	17,054,219			147,690
International Emerging Markets Fund ^(a)	9,078,789			225,880
LargeCap Growth Fund ^(a)	17,321,705			206,648
LargeCap Growth Fund I ^(a)	58,244,026			791,536
LargeCap S&P 500 Index Fund ^(a)	33,316,274			478,089
LargeCap Value Fund ^(a)	25,576,729			355,517
LargeCap Value Fund III ^(a)	39,165,924			616,863
MidCap Growth Fund III ^(a)	17,357,908			220,793
MidCap Value Fund III ^(a)	10,675,829			219,922
Overseas Fund ^(a)	45,370,554			522,215
Preferred Securities Fund ^(a)	13,376,808			139,520
SmallCap Growth Fund I ^(a)	9,320,361			130,951
SmallCap Value Fund II ^(a)	9,484,574			133,732
		$		6,946,977
TOTAL INVESTMENT COMPANIES		$		6,946,977
Total Investments		$		6,946,977
Liabilities in Excess of Other Assets, Net - (0.15)%		$		(10,305	)
TOTAL NET ASSETS - 100.00%		$		6,936,672


Schedule of Investments
Principal LifeTime 2030 Fund
October 31, 2014


	October 31,		October 31,								October 31,		October 31,
Affiliated Securities	2013		2013	Purchases		Purchases	Sales			Sales	2014		2014
	Shares		Cost	Shares		Cost	Shares			Proceeds	Shares		Cost
Bond & Mortgage Securities Fund	29,774,758	$	319,865	43,610,563	$	476,937	1,358,764		$	14,743	72,026,557	$	782,059
Bond Market Index Fund	26,415,206		281,752	1,688,759		17,998	28,103,965			307,408	—		—
Core Plus Bond Fund I	28,615,601		309,721	3,435,078		37,865	1,475,054			16,356	30,575,625		331,226
Diversified International Fund	36,860,597		485,093	3,269,495		39,125	1,583,075			19,001	38,547,017		505,280
Diversified Real Asset Fund	10,382,913		111,223	3,047,968		38,489	522,521			6,542	12,908,360		143,178
Global Multi-Strategy Fund	13,728,868		143,200	4,011,000		43,993	700,741			7,659	17,039,127		179,541
Global Opportunities Fund	25,478,075		279,114	1,882,244		23,771	1,090,501			13,740	26,269,818		289,206
Global Real Estate Securities Fund	33,366,707		250,675	4,281,039		36,325	1,469,108			12,704	36,178,638		274,300
High Yield Fund I	11,479,936		107,397	1,710,350		18,167	512,353			5,452	12,677,933		120,111
Inflation Protection Fund	9,362,582		83,290	8,419,587		71,949	727,950			6,268	17,054,219		148,967
International Emerging Markets Fund	8,326,114		202,967	1,183,547		28,811	430,872			10,631	9,078,789		221,146
LargeCap Growth Fund	16,766,268		103,576	2,979,377		32,468	2,423,940			27,225	17,321,705		109,525
LargeCap Growth Fund I	58,224,969		463,512	7,389,641		93,506	7,370,584			94,579	58,244,026		463,818
LargeCap S&P 500 Index Fund	35,983,418		336,129	2,845,135		37,616	5,512,279			73,757	33,316,274		306,036
LargeCap Value Fund	24,582,800		234,575	4,238,231		55,115	3,244,302			43,630	25,576,729		246,060
LargeCap Value Fund I	12,819,494		115,285	—		—	12,819,494			187,693	—		—
LargeCap Value Fund III	27,148,143		362,370	16,008,638		225,504	3,990,857			60,226	39,165,924		529,933
MidCap Growth Fund III	14,734,074		141,213	4,095,729		49,203	1,471,895			18,125	17,357,908		172,391
MidCap Value Fund III	10,774,345		171,744	1,080,031		20,941	1,178,547			23,125	10,675,829		170,573
Overseas Fund	41,584,638		386,252	5,380,222		63,116	1,594,306			19,000	45,370,554		430,414
Preferred Securities Fund	12,029,286		122,749	1,880,325		19,155	532,803			5,452	13,376,808		136,449
SmallCap Growth Fund I	9,190,971		85,347	1,576,941		21,886	1,447,551			19,880	9,320,361		87,207
SmallCap Value Fund II	9,670,993		76,211	1,256,519		17,102	1,442,938			19,961	9,484,574		74,889
		$	5,173,260	$		1,469,042			$	1,013,157		$	5,722,309


						Realized Gain/Loss					Realized Gain from
			Income			on Investments				Capital Gain Distributions
Bond & Mortgage Securities Fund	$		11,967	$			—			$			—
Bond Market Index Fund			6,634				7,658						—
Core Plus Bond Fund I			7,698				(4	)					—
Diversified International Fund			8,640				63						—
Diversified Real Asset Fund			2,381				8						396
Global Multi-Strategy Fund			964				7						642
Global Opportunities Fund			1,780				61						—
Global Real Estate Securities Fund			12,271				4						3,767
High Yield Fund I			7,821				(1	)					1,639
Inflation Protection Fund			176				(4	)					1,297
International Emerging Markets Fund			1,731				(1	)					—
LargeCap Growth Fund			636				706						20,226
LargeCap Growth Fund I			4,265				1,379						41,925
LargeCap S&P 500 Index Fund			7,646				6,048						—
LargeCap Value Fund			11,936				—						21,282
LargeCap Value Fund I			—				72,408						—
LargeCap Value Fund III			3,651				2,285						—
MidCap Growth Fund III			11,587				100						24,727
MidCap Value Fund III			3,788				1,013						4,264
Overseas Fund			13,770				46						18,862
Preferred Securities Fund			7,082				(3	)					3,334
SmallCap Growth Fund I			2,101				(146	)					12,028
SmallCap Value Fund II			654				1,537						8,518
	$		129,179	$			93,164			$			162,907
Amounts in thousands except shares


				Schedule of Investments
				Principal LifeTime 2040 Fund
				October 31, 2014


INVESTMENT COMPANIES - 100.12%	Shares Held		Value	(000	's)

Principal Funds, Inc. Institutional Class - 100.12%
Bond & Mortgage Securities Fund ^(a)	22,604,730	$		247,748
Core Plus Bond Fund I ^(a)	11,830,686			132,977
Diversified International Fund ^(a)	30,593,219			365,283
Diversified Real Asset Fund ^(a)	5,962,170			75,779
Global Multi-Strategy Fund ^(a)	9,091,162			100,912
Global Opportunities Fund ^(a)	19,807,034			258,680
Global Real Estate Securities Fund ^(a)	24,739,965			229,092
High Yield Fund I ^(a)	7,796,152			81,782
International Emerging Markets Fund ^(a)	7,397,067			184,039
LargeCap Growth Fund ^(a)	14,272,201			170,267
LargeCap Growth Fund I ^(a)	44,292,560			601,936
LargeCap S&P 500 Index Fund ^(a)	23,960,154			343,828
LargeCap Value Fund ^(a)	19,959,207			277,433
LargeCap Value Fund III ^(a)	30,354,664			478,086
MidCap Growth Fund III ^(a)	12,191,738			155,079
MidCap Value Fund III ^(a)	7,050,893			145,248
Overseas Fund ^(a)	31,519,541			362,790
Preferred Securities Fund ^(a)	6,743,014			70,330
SmallCap Growth Fund I ^(a)	6,720,991			94,430
SmallCap Value Fund II ^(a)	6,806,620			95,973
		$		4,471,692
TOTAL INVESTMENT COMPANIES		$		4,471,692
Total Investments		$		4,471,692
Liabilities in Excess of Other Assets, Net - (0.12)%		$		(5,576	)
TOTAL NET ASSETS - 100.00%		$		4,466,116


Schedule of Investments
Principal LifeTime 2040 Fund
October 31, 2014


	October 31,		October 31,								October 31,		October 31,
Affiliated Securities	2013		2013	Purchases		Purchases	Sales			Sales	2014		2014
	Shares		Cost	Shares		Cost	Shares			Proceeds	Shares		Cost
Bond & Mortgage Securities Fund	9,044,232	$	96,736	14,043,990	$	153,894	483,492		$	5,249	22,604,730	$	245,381
Bond Market Index Fund	8,647,038		93,091	505,636		5,387	9,152,674			100,386	—		—
Core Plus Bond Fund I	8,658,308		93,342	3,731,753		41,276	559,375			6,203	11,830,686		128,414
Diversified International Fund	28,878,912		355,649	2,919,728		34,887	1,205,421			14,449	30,593,219		376,075
Diversified Real Asset Fund	5,218,834		56,261	992,253		12,480	248,917			3,112	5,962,170		65,632
Global Multi-Strategy Fund	8,184,348		85,341	1,295,575		14,224	388,761			4,250	9,091,162		95,318
Global Opportunities Fund	19,000,417		210,404	1,561,227		19,687	754,610			9,510	19,807,034		220,608
Global Real Estate Securities Fund	22,456,619		169,492	3,318,847		28,231	1,035,501			8,956	24,739,965		188,770
High Yield Fund I	6,953,645		66,191	1,162,359		12,342	319,852			3,400	7,796,152		75,132
International Emerging Markets Fund	6,843,911		161,058	857,902		21,007	304,746			7,512	7,397,067		174,553
LargeCap Growth Fund	13,161,896		82,907	2,531,867		27,653	1,421,562			15,779	14,272,201		94,788
LargeCap Growth Fund I	40,908,258		326,904	5,876,492		74,489	2,492,190			31,631	44,292,560		369,756
LargeCap S&P 500 Index Fund	24,859,406		223,514	2,309,809		30,558	3,209,061			43,047	23,960,154		213,162
LargeCap Value Fund	17,753,550		166,730	3,344,582		43,553	1,138,925			15,029	19,959,207		195,291
LargeCap Value Fund I	9,791,321		87,589	—		—	9,791,321			143,378	—		—
LargeCap Value Fund III	19,798,596		264,066	12,603,407		177,757	2,047,339			30,359	30,354,664		411,645
MidCap Growth Fund III	9,740,092		94,747	2,895,486		34,844	443,840			5,556	12,191,738		124,047
MidCap Value Fund III	6,527,632		105,340	806,336		15,669	283,075			5,556	7,050,893		115,468
Overseas Fund	28,434,389		274,226	4,299,927		50,470	1,214,775			14,448	31,519,541		310,259
Preferred Securities Fund	5,994,788		59,851	997,232		10,163	249,006			2,549	6,743,014		67,465
SmallCap Growth Fund I	6,173,980		56,950	1,164,076		16,158	617,065			8,432	6,720,991		64,678
SmallCap Value Fund II	6,483,735		51,391	941,058		12,809	618,173			8,431	6,806,620		55,816
		$	3,181,780	$		837,538			$	487,222		$	3,592,258


						Realized Gain/Loss					Realized Gain from
			Income			on Investments				Capital Gain Distributions
Bond & Mortgage Securities Fund	$		4,004	$			—			$			—
Bond Market Index Fund			2,177				1,908						—
Core Plus Bond Fund I			2,338				(1	)					—
Diversified International Fund			6,792				(12	)					—
Diversified Real Asset Fund			1,201				3						200
Global Multi-Strategy Fund			577				3						384
Global Opportunities Fund			1,332				27						—
Global Real Estate Securities Fund			8,301				3						2,542
High Yield Fund I			4,773				(1	)					996
International Emerging Markets Fund			1,428				—						—
LargeCap Growth Fund			500				7						15,915
LargeCap Growth Fund I			3,004				(6	)					29,531
LargeCap S&P 500 Index Fund			5,297				2,137						—
LargeCap Value Fund			8,643				37						15,409
LargeCap Value Fund I			—				55,789						—
LargeCap Value Fund III			2,712				181						—
MidCap Growth Fund III			7,679				12						16,387
MidCap Value Fund III			2,301				15						2,590
Overseas Fund			9,444				11						12,930
Preferred Securities Fund			3,554				—						1,666
SmallCap Growth Fund I			1,415				2						8,098
SmallCap Value Fund II			439				47						5,724
	$		77,911	$			60,162			$			112,372
Amounts in thousands except shares


				Schedule of Investments
				Principal LifeTime 2050 Fund
				October 31, 2014


INVESTMENT COMPANIES - 100.06%	Shares Held		Value	(000	's)

Principal Funds, Inc. Institutional Class - 100.06%
Bond & Mortgage Securities Fund ^(a)	3,337,877	$		36,583
Core Plus Bond Fund I ^(a)	2,437,095			27,393
Diversified International Fund ^(a)	16,279,729			194,380
Diversified Real Asset Fund ^(a)	2,310,117			29,362
Global Multi-Strategy Fund ^(a)	3,465,410			38,466
Global Opportunities Fund ^(a)	10,772,907			140,694
Global Real Estate Securities Fund ^(a)	13,476,113			124,789
High Yield Fund I ^(a)	4,016,356			42,132
International Emerging Markets Fund ^(a)	3,840,680			95,556
LargeCap Growth Fund ^(a)	7,543,771			89,997
LargeCap Growth Fund I ^(a)	23,044,504			313,175
LargeCap S&P 500 Index Fund ^(a)	12,276,133			176,163
LargeCap Value Fund ^(a)	10,259,599			142,608
LargeCap Value Fund III ^(a)	16,103,317			253,627
MidCap Growth Fund III ^(a)	6,172,227			78,511
MidCap Value Fund III ^(a)	3,550,422			73,139
Overseas Fund ^(a)	17,129,903			197,165
Preferred Securities Fund ^(a)	4,312,486			44,979
SmallCap Growth Fund I ^(a)	3,325,299			46,720
SmallCap Value Fund II ^(a)	3,411,928			48,108
		$		2,193,547
TOTAL INVESTMENT COMPANIES		$		2,193,547
Total Investments		$		2,193,547
Liabilities in Excess of Other Assets, Net - (0.06)%		$		(1,225	)
TOTAL NET ASSETS - 100.00%		$		2,192,322


Schedule of Investments
Principal LifeTime 2050 Fund
October 31, 2014


	October 31,		October 31,								October 31,		October 31,
Affiliated Securities	2013		2013	Purchases		Purchases	Sales			Sales	2014		2014
	Shares		Cost	Shares		Cost	Shares			Proceeds	Shares		Cost
Bond & Mortgage Securities Fund	2,026,849	$	21,818	1,451,958	$	15,814	140,930		$	1,532	3,337,877	$	36,100
Bond Market Index Fund	511,933		5,398	12,188		129	524,121			5,624	—		—
Core Plus Bond Fund I	1,939,833		21,018	631,657		6,973	134,395			1,488	2,437,095		26,503
Diversified International Fund	14,626,586		174,928	2,359,744		28,195	706,601			8,461	16,279,729		194,661
Diversified Real Asset Fund	1,770,322		18,990	654,248		8,183	114,453			1,430	2,310,117		25,744
Global Multi-Strategy Fund	2,808,689		29,000	820,563		8,930	163,842			1,792	3,465,410		36,139
Global Opportunities Fund	9,989,176		111,603	1,247,825		15,705	464,094			5,851	10,772,907		121,465
Global Real Estate Securities Fund	11,330,567		85,758	2,714,951		23,133	569,405			4,896	13,476,113		103,994
High Yield Fund I	3,478,617		35,306	706,378		7,505	168,639			1,791	4,016,356		41,019
International Emerging Markets Fund	3,046,561		73,280	973,219		23,405	179,100			4,388	3,840,680		92,297
LargeCap Growth Fund	6,346,551		39,777	1,486,851		16,308	289,631			3,235	7,543,771		52,852
LargeCap Growth Fund I	20,274,054		168,062	3,707,523		47,122	937,073			12,031	23,044,504		203,165
LargeCap S&P 500 Index Fund	12,310,958		112,945	1,578,011		20,862	1,612,836			21,608	12,276,133		112,661
LargeCap Value Fund	9,030,855		86,546	2,035,202		26,588	806,458			10,551	10,259,599		102,609
LargeCap Value Fund I	4,988,358		44,644	—		—	4,988,358			72,893	—		—
LargeCap Value Fund III	10,428,542		139,086	6,986,253		98,742	1,311,478			19,190	16,103,317		218,804
MidCap Growth Fund III	4,784,628		46,672	1,634,626		19,771	247,027			3,061	6,172,227		63,385
MidCap Value Fund III	3,177,430		51,027	530,631		10,333	157,639			3,090	3,550,422		58,275
Overseas Fund	14,986,830		147,625	2,857,108		33,621	714,035			8,462	17,129,903		172,781
Preferred Securities Fund	3,716,067		38,204	771,764		7,871	175,345			1,791	4,312,486		44,284
SmallCap Growth Fund I	3,000,886		28,915	683,281		9,518	358,868			4,896	3,325,299		33,530
SmallCap Value Fund II	3,187,831		26,080	585,628		7,996	361,531			4,925	3,411,928		29,174
		$	1,506,682	$		436,704			$	202,986		$	1,769,442


						Realized Gain/Loss					Realized Gain from
			Income			on Investments				Capital Gain Distributions
Bond & Mortgage Securities Fund	$		829	$			—			$			—
Bond Market Index Fund			129				97						—
Core Plus Bond Fund I			530				—						—
Diversified International Fund			3,479				(1	)					—
Diversified Real Asset Fund			413				1						68
Global Multi-Strategy Fund			200				1						133
Global Opportunities Fund			708				8						—
Global Real Estate Securities Fund			4,284				(1	)					1,295
High Yield Fund I			2,431				(1	)					503
International Emerging Markets Fund			645				—						—
LargeCap Growth Fund			243				2						7,738
LargeCap Growth Fund I			1,502				12						14,767
LargeCap S&P 500 Index Fund			2,647				462						—
LargeCap Value Fund			4,435				26						7,906
LargeCap Value Fund I			—				28,249						—
LargeCap Value Fund III			1,425				166						—
MidCap Growth Fund III			3,806				3						8,122
MidCap Value Fund III			1,131				5						1,273
Overseas Fund			5,029				(3	)					6,877
Preferred Securities Fund			2,249				—						1,042
SmallCap Growth Fund I			693				(7	)					3,969
SmallCap Value Fund II			218				23						2,838
	$		37,026	$			29,042			$			56,531
Amounts in thousands except shares

Schedule of Investments
Principal LifeTime Strategic Income Fund
October 31, 2014


INVESTMENT COMPANIES - 99.90%	Shares Held		Value	(000	's)

Principal Funds, Inc. Institutional Class - 99.90%
Bond & Mortgage Securities Fund ^(a)	17,850,327	$		195,640
Core Plus Bond Fund I ^(a)	9,737,553			109,450
Diversified International Fund ^(a)	1,438,189			17,172
Diversified Real Asset Fund ^(a)	2,950,247			37,498
Equity Income Fund ^(a)	1,947,921			51,230
Global Diversified Income Fund ^(a)	3,369,813			49,570
Global Multi-Strategy Fund ^(a)	1,984,381			22,027
Global Opportunities Fund ^(a)	573,874			7,495
High Yield Fund I ^(a)	2,744,771			28,793
Inflation Protection Fund ^(a)	6,088,608			52,727
International Emerging Markets Fund ^(a)	198,226			4,932
LargeCap Growth Fund I ^(a)	1,877,365			25,513
LargeCap S&P 500 Index Fund ^(a)	1,281,816			18,394
MidCap Fund ^(a)	940,277			20,996
Overseas Fund ^(a)	1,560,063			17,956
Short-Term Income Fund ^(a)	10,891,347			133,201
SmallCap Growth Fund I ^(a)	394,270			5,540
SmallCap Value Fund II ^(a)	416,409			5,871
		$		804,005
TOTAL INVESTMENT COMPANIES		$		804,005
Total Investments		$		804,005
Other Assets in Excess of Liabilities, Net - 0.10%		$		785
TOTAL NET ASSETS - 100.00%		$		804,790

(a) Affiliated Security. Please see Affiliated Sub-Schedule for transactional information.


Schedule of Investments
Principal LifeTime Strategic Income Fund
October 31, 2014


	October 31,		October 31,								October 31,		October 31,
Affiliated Securities	2013		2013	Purchases		Purchases	Sales			Sales	2014		2014
	Shares		Cost	Shares		Cost	Shares			Proceeds	Shares		Cost
Bond & Mortgage Securities Fund	9,846,406	$	106,457	9,176,903	$	100,526	1,172,982		$	12,778	17,850,327	$	194,204
Bond Market Index Fund	8,343,192		89,452	1,802,098		19,308	10,145,290			110,975	—		—
Core Plus Bond Fund I	9,482,783		100,703	1,295,090		14,265	1,040,320			11,549	9,737,553		103,421
Diversified International Fund	1,675,071		20,437	162,263		1,923	399,145			4,773	1,438,189		17,695
Diversified Real Asset Fund	2,927,521		30,721	350,121		4,343	327,395			4,125	2,950,247		31,008
Equity Income Fund	2,089,639		39,541	211,140		5,246	352,858			8,785	1,947,921		36,952
Global Diversified Income Fund	3,718,254		40,588	452,417		6,560	800,858			11,743	3,369,813		35,863
Global Multi-Strategy Fund	1,992,990		20,444	217,213		2,371	225,822			2,475	1,984,381		20,357
Global Opportunities Fund	578,922		6,252	59,997		753	65,045			824	573,874		6,204
High Yield Fund I	2,583,171		25,489	433,251		4,589	271,651			2,887	2,744,771		27,191
Inflation Protection Fund	6,063,687		52,641	695,025		5,941	670,104			5,775	6,088,608		52,822
International Emerging Markets Fund	199,605		4,798	23,712		576	25,091			618	198,226		4,756
LargeCap Growth Fund I	2,148,785		17,084	304,075		3,837	575,495			7,474	1,877,365		14,800
LargeCap S&P 500 Index Fund	1,428,494		14,005	130,946		1,728	277,624			3,650	1,281,816		12,455
MidCap Fund	1,115,759		16,449	99,916		2,062	275,398			5,773	940,277		13,859
Overseas Fund	1,718,444		16,180	246,628		2,876	405,009			4,774	1,560,063		14,503
Short-Term Income Fund	8,230,771		98,718	3,644,435		44,594	983,859			12,042	10,891,347		131,273
SmallCap Growth Fund I	358,127		2,888	65,677		905	29,534			413	394,270		3,388
SmallCap Value Fund II	392,510		3,032	53,823		728	29,924			413	416,409		3,362
		$	705,879	$		223,131			$	211,846		$	724,113


						Realized Gain/Loss					Realized Gain from
			Income			on Investments				Capital Gain Distributions
Bond & Mortgage Securities Fund	$		3,444	$			(1	)		$			—
Bond Market Index Fund			2,081				2,215						—
Core Plus Bond Fund I			2,537				2						—
Diversified International Fund			390				108						—
Diversified Real Asset Fund			667				69						111
Equity Income Fund			1,110				950						—
Global Diversified Income Fund			2,447				458						—
Global Multi-Strategy Fund			139				17						93
Global Opportunities Fund			40				23						—
High Yield Fund I			1,732				—						367
Inflation Protection Fund			113				15						837
International Emerging Markets Fund			41				—						—
LargeCap Growth Fund I			157				1,353						1,541
LargeCap S&P 500 Index Fund			302				372						—
MidCap Fund			132				1,121						397
Overseas Fund			566				221						776
Short-Term Income Fund			1,833				3						54
SmallCap Growth Fund I			82				8						467
SmallCap Value Fund II			27				15						345
	$		17,840	$			6,949			$			4,988
Amounts in thousands except shares


				Schedule of Investments
				SAM Balanced Portfolio
				October 31, 2014


INVESTMENT COMPANIES - 100.03%	Shares Held		Value	(000	's)

Principal Funds, Inc. Institutional Class - 100.03%
Blue Chip Fund ^(a)	8,330,072	$		126,784
Bond & Mortgage Securities Fund ^(a)	5,091,556			55,803
Diversified International Fund ^(a)	36,041,816			430,339
Equity Income Fund ^(a)	23,640,900			621,756
Global Diversified Income Fund ^(a)	4,920,716			72,384
Global Multi-Strategy Fund ^(a)	20,232,264			224,578
Global Real Estate Securities Fund ^(a)	5,413,459			50,129
Government & High Quality Bond Fund ^(a)	38,109,998			420,734
High Yield Fund ^(a)	11,465,281			87,939
Income Fund ^(a)	68,042,574			665,456
International Emerging Markets Fund ^(a)	4,155,230			103,382
LargeCap Growth Fund ^(a)	32,451,586			387,147
LargeCap Growth Fund II ^(a)	10,045,403			109,696
LargeCap Value Fund ^(a)	37,824,306			525,758
MidCap Fund ^(a)	5,950,853			132,883
Preferred Securities Fund ^(a)	5,629,925			58,720
Principal Capital Appreciation Fund ^(a)	5,541,885			330,684
Short-Term Income Fund ^(a)	13,665,438			167,128
SmallCap Growth Fund I ^(a)	7,470,283			104,957
SmallCap Value Fund II ^(a)	9,203,656			129,772
Small-MidCap Dividend Income Fund ^(a)	7,403,427			104,759
		$		4,910,788
TOTAL INVESTMENT COMPANIES		$		4,910,788
Total Investments		$		4,910,788
Liabilities in Excess of Other Assets, Net - (0.03)%		$		(1,356	)
TOTAL NET ASSETS - 100.00%		$		4,909,432


Schedule of Investments
SAM Balanced Portfolio
October 31, 2014


	October 31,		October 31,								October 31,		October 31,
Affiliated Securities	2013		2013	Purchases		Purchases	Sales			Sales	2014		2014
	Shares		Cost	Shares		Cost	Shares			Proceeds	Shares		Cost
Blue Chip Fund	8,370,648	$	107,825	98,354	$	1,363	138,930		$	1,919	8,330,072	$	107,294
Bond & Mortgage Securities Fund	4,881,613		53,581	209,943		2,275	—			—	5,091,556		55,856
Diversified International Fund	36,039,977		344,492	847,781		10,011	845,942			10,075	36,041,816		344,487
Equity Income Fund	23,339,380		353,186	679,107		16,838	377,587			9,021	23,640,900		361,003
Global Diversified Income Fund	4,724,084		63,001	275,917		3,974	79,285			1,118	4,920,716		65,850
Global Multi-Strategy Fund	14,814,969		152,940	5,417,295		59,446	—			—	20,232,264		212,386
Global Real Estate Securities Fund	2,547,617		18,497	2,865,842		25,145	—			—	5,413,459		43,642
Government & High Quality Bond	39,412,766		418,186	1,797,505		19,683	3,100,273			34,100	38,109,998		403,637
Fund
High Yield Fund	11,303,214		80,077	1,185,245		9,227	1,023,178			7,917	11,465,281		81,284
Income Fund	61,964,630		570,690	6,680,473		65,122	602,529			5,797	68,042,574		629,808
International Emerging Markets Fund	4,115,403		91,297	86,252		2,073	46,425			1,117	4,155,230		92,150
LargeCap Growth Fund	29,456,261		180,046	3,546,672		38,069	551,347			6,191	32,451,586		212,413
LargeCap Growth Fund II	10,856,124		65,391	1,107,334		11,014	1,918,055			20,004	10,045,403		59,410
LargeCap Value Fund	34,006,073		397,431	4,382,223		56,458	563,990			7,402	37,824,306		446,386
MidCap Fund	5,875,294		50,041	158,478		3,186	82,919			1,676	5,950,853		51,854
Preferred Securities Fund	5,194,184		36,401	441,586		4,464	5,845			61	5,629,925		40,804
Principal Capital Appreciation Fund	5,558,801		176,265	212,378		11,395	229,294			12,805	5,541,885		175,631
Short-Term Income Fund	12,833,922		153,150	882,998		10,809	51,482			632	13,665,438		163,324
SmallCap Growth Fund I	8,431,757		86,057	963,381		13,301	1,924,855			26,212	7,470,283		75,659
SmallCap Value Fund II	9,205,870		102,379	676,942		9,097	679,156			9,242	9,203,656		102,349
Small-MidCap Dividend Income Fund	7,167,822		71,369	361,605		4,881	126,000			1,676	7,403,427		74,584
		$	3,572,302	$		377,831			$	156,965		$	3,799,811


						Realized Gain/Loss					Realized Gain from
			Income			on Investments				Capital Gain Distributions
Blue Chip Fund	$		347	$			25			$			2
Bond & Mortgage Securities Fund			1,501				—						—
Diversified International Fund			8,388				59						—
Equity Income Fund			13,186				—						—
Global Diversified Income Fund			3,178				(7	)					—
Global Multi-Strategy Fund			1,049				—						697
Global Real Estate Securities Fund			1,080				—						288
Government & High Quality Bond Fund			13,625				(132	)					—
High Yield Fund			6,388				(103	)					1,291
Income Fund			24,540				(207	)					—
International Emerging Markets Fund			856				(103	)					—
LargeCap Growth Fund			1,111				489						35,334
LargeCap Growth Fund II			778				3,009						9,221
LargeCap Value Fund			16,448				(101	)					29,311
MidCap Fund			693				303						2,088
Preferred Securities Fund			3,025				—						1,441
Principal Capital Appreciation Fund			3,440				776						6,333
Short-Term Income Fund			2,755				(3	)					85
SmallCap Growth Fund I			1,918				2,513						10,978
SmallCap Value Fund II			620				115						8,072
Small-MidCap Dividend Income Fund			2,309				10						1,760
	$		107,235	$			6,643			$			106,901
Amounts in thousands except shares


			Schedule of Investments
	SAM Conservative Balanced Portfolio
			October 31, 2014


INVESTMENT COMPANIES - 100.00%	Shares Held	Value (000's)

Principal Funds, Inc. Institutional Class - 100.00%
Blue Chip Fund ^(a)	1,890,265	$	28,770
Bond & Mortgage Securities Fund ^(a)	3,508,758		38,456
Diversified International Fund ^(a)	8,015,503		95,705
Equity Income Fund ^(a)	5,354,789		140,831
Global Diversified Income Fund ^(a)	2,749,110		40,439
Global Multi-Strategy Fund ^(a)	5,919,935		65,711
Global Real Estate Securities Fund ^(a)	1,747,663		16,183
Government & High Quality Bond Fund ^(a)	21,142,894		233,418
High Yield Fund ^(a)	6,581,494		50,480
Income Fund ^(a)	38,223,422		373,825
International Emerging Markets Fund ^(a)	900,752		22,411
LargeCap Growth Fund ^(a)	7,478,656		89,220
LargeCap Growth Fund II ^(a)	2,234,944		24,406
LargeCap Value Fund ^(a)	8,788,787		122,164
MidCap Fund ^(a)	1,342,112		29,969
Preferred Securities Fund ^(a)	3,118,200		32,523
Principal Capital Appreciation Fund ^(a)	1,257,119		75,012
Short-Term Income Fund ^(a)	7,796,198		95,348
SmallCap Growth Fund I ^(a)	1,631,306		22,920
SmallCap Value Fund II ^(a)	1,985,144		27,991
Small-MidCap Dividend Income Fund ^(a)	1,719,512		24,331
		$	1,650,113
TOTAL INVESTMENT COMPANIES		$	1,650,113
Total Investments		$	1,650,113
Liabilities in Excess of Other Assets, Net - 0.00%		$	(48	)
TOTAL NET ASSETS - 100.00%		$	1,650,065

(a) Affiliated Security. Please see Affiliated Sub-Schedule for transactional information.


Schedule of Investments
SAM Conservative Balanced Portfolio
October 31, 2014


	October 31,		October 31,								October 31,		October 31,
Affiliated Securities	2013		2013	Purchases		Purchases	Sales			Sales	2014		2014
	Shares		Cost	Shares		Cost	Shares			Proceeds	Shares		Cost
Blue Chip Fund	1,866,845	$	23,762	36,326	$	503	12,906		$	180	1,890,265	$	24,085
Bond & Mortgage Securities Fund	3,331,244		36,578	211,017		2,280	33,503			359	3,508,758		38,490
Diversified International Fund	7,943,252		74,711	280,986		3,312	208,735			2,484	8,015,503		75,544
Equity Income Fund	5,223,914		83,338	226,296		5,532	95,421			2,295	5,354,789		86,560
Global Diversified Income Fund	2,582,653		34,783	199,644		2,864	33,187			467	2,749,110		37,173
Global Multi-Strategy Fund	3,370,564		34,853	2,549,370		27,963	—			—	5,919,934		62,816
Global Real Estate Securities Fund	825,472		6,007	944,073		8,262	21,882			179	1,747,663		14,094
Government & High Quality Bond	21,083,586		227,630	1,389,816		15,200	1,330,508			14,613	21,142,894		227,777
Fund
High Yield Fund	6,292,656		46,075	733,034		5,710	444,196			3,434	6,581,494		48,282
Income Fund	32,249,800		302,624	6,312,831		61,528	339,209			3,257	38,223,422		360,765
International Emerging Markets Fund	882,815		18,295	25,412		610	7,475			180	900,752		18,710
LargeCap Growth Fund	6,672,254		45,708	930,870		10,050	124,468			1,368	7,478,656		54,341
LargeCap Growth Fund II	2,395,356		16,146	266,189		2,654	426,601			4,469	2,234,944		14,804
LargeCap Value Fund	7,635,435		86,932	1,292,553		16,783	139,201			1,798	8,788,787		101,836
MidCap Fund	1,318,425		14,379	41,431		833	17,744			358	1,342,112		14,880
Preferred Securities Fund	2,826,610		23,347	327,799		3,308	36,209			360	3,118,200		26,263
Principal Capital Appreciation Fund	1,257,040		40,954	73,259		3,935	73,180			4,129	1,257,119		40,956
Short-Term Income Fund	6,939,240		82,620	915,704		11,209	58,746			718	7,796,198		93,106
SmallCap Growth Fund I	1,874,269		19,817	238,986		3,317	481,949			6,545	1,631,306		17,047
SmallCap Value Fund II	2,044,163		22,804	143,899		1,933	202,918			2,770	1,985,144		22,016
Small-MidCap Dividend Income Fund	1,657,363		16,656	85,384		1,151	23,235			310	1,719,512		17,499
		$	1,258,019	$		188,937			$	50,273		$	1,397,044


						Realized Gain/Loss					Realized Gain from
			Income			on Investments				Capital Gain Distributions
Blue Chip Fund	$		78	$			—			$			1
Bond & Mortgage Securities Fund			1,034				(9	)					—
Diversified International Fund			1,863				5						—
Equity Income Fund			2,984				(15	)					—
Global Diversified Income Fund			1,770				(7	)					—
Global Multi-Strategy Fund			244				—						162
Global Real Estate Securities Fund			347				4						93
Government & High Quality Bond Fund			7,467				(440	)					—
High Yield Fund			3,592				(69	)					724
Income Fund			13,302				(130	)					—
International Emerging Markets Fund			185				(15	)					—
LargeCap Growth Fund			254				(49	)					8,096
LargeCap Growth Fund II			173				473						2,056
LargeCap Value Fund			3,726				(81	)					6,644
MidCap Fund			156				26						470
Preferred Securities Fund			1,672				(32	)					791
Principal Capital Appreciation Fund			787				196						1,449
Short-Term Income Fund			1,540				(5	)					47
SmallCap Growth Fund I			430				458						2,462
SmallCap Value Fund II			138				49						1,795
Small-MidCap Dividend Income Fund			535				2						408
	$		42,277	$			361			$			25,198
Amounts in thousands except shares


			Schedule of Investments
	SAM Conservative Growth Portfolio
			October 31, 2014


INVESTMENT COMPANIES - 100.08%	Shares Held	Value (000's)

Principal Funds, Inc. Institutional Class - 100.08%
Blue Chip Fund ^(a)	7,149,147	$	108,811
Diversified International Fund ^(a)	31,225,189		372,829
Diversified Real Asset Fund ^(a)	3,693,377		46,943
Equity Income Fund ^(a)	21,119,412		555,440
Global Multi-Strategy Fund ^(a)	15,123,053		167,866
Global Real Estate Securities Fund ^(a)	3,828,640		35,453
Government & High Quality Bond Fund ^(a)	7,926,599		87,510
High Yield Fund ^(a)	2,490,537		19,102
Income Fund ^(a)	16,436,805		160,752
International Emerging Markets Fund ^(a)	3,636,303		90,471
LargeCap Growth Fund ^(a)	28,991,788		345,872
LargeCap Growth Fund II ^(a)	7,982,034		87,164
LargeCap Value Fund ^(a)	32,588,127		452,975
MidCap Fund ^(a)	4,889,848		109,190
Preferred Securities Fund ^(a)	1,556,237		16,231
Principal Capital Appreciation Fund ^(a)	4,889,573		291,761
Short-Term Income Fund ^(a)	3,052,997		37,338
SmallCap Growth Fund I ^(a)	6,167,699		86,656
SmallCap Value Fund II ^(a)	7,988,977		112,645
Small-MidCap Dividend Income Fund ^(a)	6,372,977		90,178
		$	3,275,187
TOTAL INVESTMENT COMPANIES		$	3,275,187
Total Investments		$	3,275,187
Liabilities in Excess of Other Assets, Net - (0.08)%		$	(2,468	)
TOTAL NET ASSETS - 100.00%		$	3,272,719


Schedule of Investments
SAM Conservative Growth Portfolio
October 31, 2014


	October 31,		October 31,								October 31,		October 31,
Affiliated Securities	2013		2013	Purchases		Purchases	Sales			Sales	2014		2014
	Shares		Cost	Shares		Cost	Shares			Proceeds	Shares		Cost
Blue Chip Fund	7,160,712	$	91,640	80,756	$	1,117	92,321		$	1,281	7,149,147	$	91,484
Diversified International Fund	31,002,661		304,375	860,146		10,140	637,618			7,581	31,225,189		306,933
Diversified Real Asset Fund	3,661,797		40,634	81,011		971	49,431			598	3,693,377		41,033
Equity Income Fund	20,795,857		318,238	615,538		15,238	291,983			6,975	21,119,412		326,475
Global Multi-Strategy Fund	12,643,877		131,054	2,499,831		27,387	20,655			222	15,123,053		158,219
Global Real Estate Securities Fund	2,369,680		17,152	1,504,091		13,117	45,131			375	3,828,640		29,913
Government & High Quality Bond	9,123,150		95,503	410,277		4,492	1,606,828			17,681	7,926,599		82,764
Fund
High Yield Fund	2,252,527		14,726	238,010		1,853	—			—	2,490,537		16,579
Income Fund	15,337,182		138,897	1,216,640		11,835	117,017			1,126	16,436,805		149,594
International Emerging Markets Fund	3,605,525		85,666	71,167		1,707	40,389			974	3,636,303		86,327
LargeCap Growth Fund	26,261,037		173,345	3,188,251		34,234	457,500			5,100	28,991,788		202,795
LargeCap Growth Fund II	9,257,365		59,007	942,517		9,377	2,217,848			23,173	7,982,034		49,517
LargeCap Value Fund	29,091,629		338,299	3,878,971		50,039	382,473			4,964	32,588,127		383,260
MidCap Fund	4,825,054		39,990	139,014		2,795	74,220			1,501	4,889,848		41,536
Preferred Securities Fund	1,446,075		10,236	147,674		1,490	37,512			375	1,556,237		11,345
Principal Capital Appreciation Fund	4,967,520		157,038	197,342		10,584	275,289			15,502	4,889,573		153,129
Short-Term Income Fund	2,843,614		33,786	209,383		2,563	—			—	3,052,997		36,349
SmallCap Growth Fund I	7,452,261		75,699	886,113		12,257	2,170,675			29,686	6,167,699		61,971
SmallCap Value Fund II	8,147,618		90,888	610,224		8,203	768,865			10,526	7,988,977		88,769
Small-MidCap Dividend Income Fund	6,160,405		61,191	297,183		4,013	84,611			1,127	6,372,977		64,082
		$	2,277,364	$		223,412			$	128,767		$	2,382,074


						Realized Gain/Loss					Realized Gain from
			Income			on Investments				Capital Gain Distributions
Blue Chip Fund	$		297	$			8			$			2
Diversified International Fund			7,236				(1	)					—
Diversified Real Asset Fund			832				26						139
Equity Income Fund			11,769				(26	)					—
Global Multi-Strategy Fund			894				—						594
Global Real Estate Securities Fund			932				19						266
Government & High Quality Bond Fund			3,082				450						—
High Yield Fund			1,299				—						258
Income Fund			6,030				(12	)					—
International Emerging Markets Fund			748				(72	)					—
LargeCap Growth Fund			992				316						31,596
LargeCap Growth Fund II			665				4,306						7,895
LargeCap Value Fund			14,122				(114	)					25,188
MidCap Fund			570				252						1,718
Preferred Securities Fund			838				(6	)					400
Principal Capital Appreciation Fund			3,077				1,009						5,674
Short-Term Income Fund			615				—						19
SmallCap Growth Fund I			1,701				3,701						9,738
SmallCap Value Fund II			548				204						7,147
Small-MidCap Dividend Income Fund			1,988				5						1,518
	$		58,235	$			10,065			$			92,152
Amounts in thousands except shares


				Schedule of Investments
				SAM Flexible Income Portfolio
				October 31, 2014


INVESTMENT COMPANIES - 99.84%	Shares Held		Value	(000	's)

Principal Funds, Inc. Institutional Class - 99.84%
Blue Chip Fund ^(a)	1,350,809	$		20,559
Bond & Mortgage Securities Fund ^(a)	7,035,669			77,111
Diversified International Fund ^(a)	4,358,106			52,036
Equity Income Fund ^(a)	6,391,396			168,094
Global Diversified Income Fund ^(a)	6,735,478			99,079
Global Real Estate Securities Fund ^(a)	2,305,591			21,350
Government & High Quality Bond Fund ^(a)	26,445,155			291,954
High Yield Fund ^(a)	13,450,642			103,166
Income Fund ^(a)	62,497,941			611,230
International Emerging Markets Fund ^(a)	797,008			19,830
LargeCap Growth Fund ^(a)	7,040,783			83,997
LargeCap Value Fund ^(a)	8,279,764			115,089
Preferred Securities Fund ^(a)	7,577,507			79,033
Principal Capital Appreciation Fund ^(a)	644,235			38,441
Short-Term Income Fund ^(a)	14,156,370			173,132
SmallCap Growth Fund I ^(a)	1,509,044			21,202
Small-MidCap Dividend Income Fund ^(a)	6,464,859			91,478
		$		2,066,781
TOTAL INVESTMENT COMPANIES		$		2,066,781
Total Investments		$		2,066,781
Other Assets in Excess of Liabilities, Net - 0.16%		$		3,305
TOTAL NET ASSETS - 100.00%		$		2,070,086


Schedule of Investments
SAM Flexible Income Portfolio
October 31, 2014


	October 31,		October 31,								October 31,		October 31,
Affiliated Securities	2013		2013	Purchases		Purchases	Sales			Sales	2014		2014
	Shares		Cost	Shares		Cost	Shares			Proceeds	Shares		Cost
Blue Chip Fund	1,346,752	$	17,291	4,057	$	56	—		$	—	1,350,809	$	17,347
Bond & Mortgage Securities Fund	6,670,493		73,025	483,017		5,241	117,841			1,264	7,035,669		76,956
Diversified International Fund	4,559,411		41,805	89,437		1,057	290,742			3,498	4,358,106		39,535
Equity Income Fund	6,309,509		105,751	254,728		6,283	172,841			4,225	6,391,396		107,829
Global Diversified Income Fund	5,745,137		77,101	1,050,134		15,361	59,793			843	6,735,478		91,613
Global Real Estate Securities Fund	1,664,295		12,081	666,626		5,824	25,330			211	2,305,591		17,680
Government & High Quality Bond	26,037,134		282,269	1,465,535		16,046	1,057,514			11,605	26,445,155		286,309
Fund
High Yield Fund	11,652,970		85,126	1,959,961		15,310	162,289			1,264	13,450,642		99,129
Income Fund	53,494,700		503,421	9,472,928		92,508	469,687			4,513	62,497,941		591,233
International Emerging Markets Fund	793,634		17,599	20,803		497	17,429			421	797,008		17,639
LargeCap Growth Fund	6,384,633		49,477	850,636		9,183	194,486			2,163	7,040,783		56,547
LargeCap Value Fund	6,197,732		71,578	2,178,305		28,797	96,273			1,264	8,279,764		99,077
Preferred Securities Fund	6,324,128		51,003	1,337,764		13,698	84,385			844	7,577,507		63,839
Principal Capital Appreciation Fund	696,595		23,812	22,814		1,224	75,174			4,236	644,235		21,615
Short-Term Income Fund	11,320,738		134,417	2,860,043		35,011	24,411			299	14,156,370		169,128
SmallCap Growth Fund I	1,700,311		19,490	188,441		2,599	379,708			5,291	1,509,044		16,848
Small-MidCap Dividend Income Fund	6,070,337		65,882	489,299		6,631	94,777			1,264	6,464,859		71,248
		$	1,631,128	$		255,326			$	43,205		$	1,843,572


						Realized Gain/Loss					Realized Gain from
			Income			on Investments				Capital Gain Distributions
Blue Chip Fund	$		56	$			—			$			—
Bond & Mortgage Securities Fund			2,043				(46	)					—
Diversified International Fund			1,057				171						—
Equity Income Fund			3,561				20						—
Global Diversified Income Fund			4,044				(6	)					—
Global Real Estate Securities Fund			632				(14	)					187
Government & High Quality Bond Fund			9,194				(401	)					—
High Yield Fund			6,818				(43	)					1,332
Income Fund			21,636				(183	)					—
International Emerging Markets Fund			164				(36	)					—
LargeCap Growth Fund			241				50						7,669
LargeCap Value Fund			3,006				(34	)					5,361
Preferred Securities Fund			3,860				(18	)					1,758
Principal Capital Appreciation Fund			430				815						794
Short-Term Income Fund			2,580				(1	)					75
SmallCap Growth Fund I			386				50						2,211
Small-MidCap Dividend Income Fund			1,966				(1	)					1,497
	$		61,674	$			323			$			20,884
Amounts in thousands except shares


Schedule of Investments
SAM Strategic Growth Portfolio
October 31, 2014


	October 31,		October 31,								October 31,		October 31,
Affiliated Securities	2013		2013	Purchases		Purchases	Sales			Sales	2014		2014
	Shares		Cost	Shares		Cost	Shares			Proceeds	Shares		Cost
Blue Chip Fund	5,592,207	$	71,283	37,024	$	513	88,122		$	1,216	5,541,109	$	70,608
Diversified International Fund	16,509,940		154,884	377,411		4,456	1,100,624			13,188	15,786,727		147,133
Equity Income Fund	14,617,850		233,973	376,393		9,381	284,853			6,828	14,709,390		236,475
Global Real Estate Securities Fund	2,759,476		19,644	1,035,443		8,907	36,560			304	3,758,359		28,263
International Emerging Markets Fund	3,730,271		87,447	56,205		1,349	45,394			1,084	3,741,082		87,609
LargeCap Growth Fund	27,826,846		208,708	3,413,454		36,679	593,029			6,608	30,647,271		238,736
LargeCap Growth Fund II	7,250,714		46,784	693,450		6,892	3,193,357			33,252	4,750,807		28,355
LargeCap Value Fund	24,713,997		295,608	3,125,668		40,254	385,010			5,007	27,454,655		330,734
MidCap Fund	1,411,508		11,648	36,488		734	15,051			305	1,432,945		12,113
Principal Capital Appreciation Fund	3,566,312		113,247	128,702		6,905	69,600			3,754	3,625,414		116,449
SmallCap Growth Fund I	5,510,797		55,784	634,906		8,772	2,615,121			35,846	3,530,582		35,165
SmallCap Value Fund II	5,479,229		57,366	398,363		5,354	629,033			8,641	5,248,559		54,283
Small-MidCap Dividend Income Fund	3,981,323		39,391	171,780		2,324	40,161			535	4,112,942		41,217
		$	1,395,767	$		132,520			$	116,568		$	1,427,140


						Realized Gain/Loss					Realized Gain from
			Income			on Investments				Capital Gain Distributions
Blue Chip Fund	$		231	$			28			$			2
Diversified International Fund			3,839				981						—
Equity Income Fund			8,227				(51	)					—
Global Real Estate Securities Fund			1,053				16						310
International Emerging Markets Fund			774				(103	)					—
LargeCap Growth Fund			1,048				(43	)					33,367
LargeCap Growth Fund II			519				7,931						6,156
LargeCap Value Fund			11,965				(121	)					21,334
MidCap Fund			167				36						503
Principal Capital Appreciation Fund			2,204				51						4,062
SmallCap Growth Fund I			1,257				6,455						7,195
SmallCap Value Fund II			368				204						4,794
Small-MidCap Dividend Income Fund			1,282				37						978
	$		32,934	$			15,421			$			78,701
Amounts in thousands except shares


						FINANCIAL HIGHLIGHTS
PRINCIPAL FUNDS, INC.


Selected data for a share of Capital Stock outstanding throughout each year ended October 31:


		Net Asset		Net		Net Realized				Dividends		Distributions			Total
		Value,		Investment		and Unrealized		Total From		from Net		from			Dividends			Net Asset
		Beginning		Income		Gain (Loss) on		Investment		Investment		Realized			and			Value, End
		of Period		(Loss)(a)		Investments		Operations		Income		Gains			Distributions			of Period	Total Return(b)
PRINCIPAL LIFETIME 2010 FUND
Class A shares
2014	$	13.18	$	0.23	$	0.57	$	0.80	($	0.22	)	$–		($	0.22	)	$	13.76	6.14	%
2013		12.18		0.24		1.01		1.25		(0.25	)	–			(0.25	)		13.18	10.45
2012		11.40		0.20		0.82		1.02		(0.24	)	–			(0.24	)		12.18	9.19
2011		11.19		0.25		0.21		0.46		(0.25	)	–			(0.25	)		11.40	4.13
2010		9.90		0.25		1.33		1.58		(0.29	)	–			(0.29	)		11.19	16.25
PRINCIPAL LIFETIME 2020 FUND
Class A shares
2014		14.32		0.23		0.82		1.05		(0.23	)	(0.15	)		(0.38	)		14.99	7.44
2013		12.66		0.24		1.67		1.91		(0.25	)	–			(0.25	)		14.32	15.35
2012		11.69		0.20		1.00		1.20		(0.23	)	–			(0.23	)		12.66	10.46
2011		11.52		0.21		0.18		0.39		(0.22	)	–			(0.22	)		11.69	3.39
2010		10.09		0.22		1.47		1.69		(0.26	)	–			(0.26	)		11.52	16.97
Class B shares
2014		14.37		0.15		0.79		0.94		(0.07	)	(0.15	)		(0.22	)		15.09	6.63
2013		12.66		0.19		1.64		1.83		(0.12	)	–			(0.12	)		14.37	14.55
2012		11.69		0.14		0.96		1.10		(0.13	)	–			(0.13	)		12.66	9.51
2011		11.51		0.13		0.18		0.31		(0.13	)	–			(0.13	)		11.69	2.67
2010		10.08		0.15		1.47		1.62		(0.19	)	–			(0.19	)		11.51	16.21
PRINCIPAL LIFETIME 2030 FUND
Class A shares
2014		14.48		0.23		0.95		1.18		(0.23	)	(0.19	)		(0.42	)		15.24	8.36
2013		12.45		0.23		2.04		2.27		(0.24	)	–			(0.24	)		14.48	18.51
2012		11.49		0.19		0.99		1.18		(0.22	)	–			(0.22	)		12.45	10.50
2011		11.30		0.17		0.21		0.38		(0.19	)	–			(0.19	)		11.49	3.32
2010		9.80		0.19		1.53		1.72		(0.22	)	–			(0.22	)		11.30	17.79
Class B shares
2014		14.57		0.14		0.94		1.08		(0.09	)	(0.19	)		(0.28	)		15.37	7.55
2013		12.50		0.18		2.00		2.18		(0.11	)	–			(0.11	)		14.57	17.56
2012		11.51		0.14		0.97		1.11		(0.12	)	–			(0.12	)		12.50	9.73
2011		11.32		0.10		0.19		0.29		(0.10	)	–			(0.10	)		11.51	2.55
2010		9.83		0.12		1.52		1.64		(0.15	)	–			(0.15	)		11.32	16.86


						FINANCIAL HIGHLIGHTS
PRINCIPAL FUNDS, INC.


Selected data for a share of Capital Stock outstanding throughout each year ended October 31:
		Net Asset		Net		Net Realized			Dividends		Distributions			Total
		Value,		Investment		and Unrealized		Total From	from Net		from			Dividends Net Asset
		Beginning		Income		Gain (Loss) on		Investment	Investment		Realized			and			Value, End
		of Period		(Loss)(a)		Investments		Operations	Income		Gains			Distributions			of Period	Total Return(b)
PRINCIPAL LIFETIME 2040 FUND
Class A shares
2014	$	14.80	$	0.21	$	1.09	$	1.30	($0.23	)	($0.37	)	($	0.60	)	$	15.50	9.02	%
2013		12.42		0.22		2.39		2.61	(0.23	)	–			(0.23	)		14.80	21.35
2012		11.42		0.17		1.03		1.20	(0.20	)	–			(0.20	)		12.42	10.73
2011		11.23		0.15		0.20		0.35	(0.16	)	–			(0.16	)		11.42	3.08
2010		9.71		0.17		1.54		1.71	(0.19	)	–			(0.19	)		11.23	17.82
Class B shares
2014		14.73		0.13		1.04		1.17	(0.09	)	(0.37	)		(0.46	)		15.44	8.14
2013		12.34		0.16		2.34		2.50	(0.11	)	–			(0.11	)		14.73	20.43
2012		11.33		0.12		0.99		1.11	(0.10	)	–			(0.10	)		12.34	9.90
2011		11.13		0.07		0.20		0.27	(0.07	)	–			(0.07	)		11.33	2.40
2010		9.64		0.10		1.51		1.61	(0.12	)	–			(0.12	)		11.13	16.86
PRINCIPAL LIFETIME 2050 FUND
Class A shares
2014		14.61		0.20		1.13		1.33	(0.22	)	(0.41	)		(0.63	)		15.31	9.43
2013		12.11		0.19		2.53		2.72	(0.22	)	–			(0.22	)		14.61	22.78
2012		11.09		0.16		1.03		1.19	(0.17	)	–			(0.17	)		12.11	10.98
2011		10.90		0.14		0.19		0.33	(0.14	)	–			(0.14	)		11.09	2.95
2010		9.38		0.15		1.53		1.68	(0.16	)	–			(0.16	)		10.90	18.10
Class B shares
2014		14.51		0.13		1.08		1.21	(0.07	)	(0.41	)		(0.48	)		15.24	8.59
2013		12.01		0.16		2.45		2.61	(0.11	)	–			(0.11	)		14.51	21.92
2012		10.98		0.09		1.01		1.10	(0.07	)	–			(0.07	)		12.01	10.14
2011		10.79		0.06		0.18		0.24	(0.05	)	–			(0.05	)		10.98	2.17
2010		9.30		0.08		1.51		1.59	(0.10	)	–			(0.10	)		10.79	17.16
PRINCIPAL LIFETIME STRATEGIC INCOME FUND
Class A shares
2014		11.94		0.22		0.36		0.58	(0.22	)	–			(0.22	)		12.30	4.92
2013		11.60		0.26		0.34		0.60	(0.26	)	–			(0.26	)		11.94	5.26
2012		11.00		0.21		0.67		0.88	(0.28	)	–			(0.28	)		11.60	8.17
2011		10.93		0.31		0.06		0.37	(0.30	)	–			(0.30	)		11.00	3.50
2010		9.95		0.32		1.00		1.32	(0.34	)	–			(0.34	)		10.93	13.67
Class B shares
2014		11.84		0.14		0.34		0.48	(0.09	)	–			(0.09	)		12.23	4.12
2013		11.49		0.19		0.32		0.51	(0.16	)	–			(0.16	)		11.84	4.45
2012		10.88		0.15		0.63		0.78	(0.17	)	–			(0.17	)		11.49	7.28
2011		10.81		0.23		0.06		0.29	(0.22	)	–			(0.22	)		10.88	2.73
2010		9.86		0.25		0.99		1.24	(0.29	)	–			(0.29	)		10.81	12.81


						FINANCIAL HIGHLIGHTS (Continued)
						PRINCIPAL FUNDS, INC.


		Ratio of		Ratio of Net
		Expenses to		Investment Income
	Net Assets, End of	Average Net		to Average Net		Portfolio
	Period (in thousands)	Assets		Assets		Turnover Rate


$	82,944	0.41%(c),(d)		1.43	%	11.5	%
	69,974	0.41 (c)	,(d)	1.65		30.1
	54,432	0.41 (c)	,(d)	1.44		12.5
	44,108	0.41 (c)	,(d)	1.28		12.6
	38,484	0.41 (c)	,(d)	1.62		31.4

	3,159	1.16 (c)	,(d)	0.88		11.5
	3,300	1.16 (c)	,(d)	1.22		30.1
	3,973	1.16 (c)	,(d)	1.01		12.5
	5,195	1.16 (c)	,(d)	0.61		12.6
	5,620	1.16 (c)	,(d)	1.00		31.4


	61,439	0.41 (c)	,(d)	1.35		9.9
	50,375	0.41 (c)	,(d)	1.43		29.5
	31,354	0.41 (c)	,(d)	1.35		10.5
	26,285	0.41 (c)	,(d)	1.18		15.5
	23,723	0.41 (c)	,(d)	1.45		30.1

	934	1.16 (c)	,(d)	0.90		9.9
	1,012	1.16 (c)	,(d)	1.19		29.5
	1,258	1.16 (c)	,(d)	0.81		10.5
	1,491	1.16 (c)	,(d)	0.53		15.5
	1,783	1.16 (c)	,(d)	0.83		30.1


	31,332	0.41 (c)	,(d)	1.85		26.8
	30,838	0.41 (c)	,(d)	2.20		14.6
	29,464	0.41 (c)	,(d)	1.90		31.1
	25,812	0.41 (c)	,(d)	2.87		19.8
	25,982	0.41 (c)	,(d)	3.09		46.9

	336	1.16 (c)	,(d)	1.20		26.8
	379	1.16 (c)	,(d)	1.64		14.6
	461	1.16 (c)	,(d)	1.39		31.1
	798	1.16 (c)	,(d)	2.14		19.8
	840	1.16 (c)	,(d)	2.43		46.9


						FINANCIAL HIGHLIGHTS
PRINCIPAL FUNDS, INC.


Selected data for a share of Capital Stock outstanding throughout each year ended October 31:
		Net Asset		Net		Net Realized				Dividends			Distributions			Total
		Value,		Investment		and Unrealized		Total From		from Net			from			Dividends			Net Asset
		Beginning		Income		Gain (Loss) on		Investment		Investment			Realized			and			Value, End
		of Period		(Loss)(a)		Investments		Operations		Income			Gains			Distributions			of Period	Total Return(b)
SAM BALANCED PORTFOLIO
Class A shares
2014	$	15.60	$	0.26	$	1.04	$	1.30	($	0.26	)	($	0.25	)	($	0.51	)	$	16.39	8.50	%
2013		13.70		0.26		1.90		2.16		(0.26	)		–			(0.26	)		15.60	15.97
2012		12.67		0.26		1.03		1.29		(0.26	)		–			(0.26	)		13.70	10.27
2011		12.45		0.28		0.22		0.50		(0.28	)		–			(0.28	)		12.67	4.03
2010		11.00		0.26		1.46		1.72		(0.27	)		–			(0.27	)		12.45	15.84
Class B shares
2014		15.60		0.17		0.99		1.16		(0.13	)		(0.25	)		(0.38	)		16.38	7.57
2013		13.68		0.16		1.89		2.05		(0.13	)		–			(0.13	)		15.60	15.11
2012		12.65		0.16		1.00		1.16		(0.13	)		–			(0.13	)		13.68	9.29
2011		12.42		0.19		0.21		0.40		(0.17	)		–			(0.17	)		12.65	3.22
2010		10.97		0.17		1.45		1.62		(0.17	)		–			(0.17	)		12.42	14.88
Class C shares
2014		15.43		0.14		1.02		1.16		(0.14	)		(0.25	)		(0.39	)		16.20	7.67
2013		13.55		0.15		1.89		2.04		(0.16	)		–			(0.16	)		15.43	15.17
2012		12.54		0.16		1.01		1.17		(0.16	)		–			(0.16	)		13.55	9.42
2011		12.33		0.19		0.21		0.40		(0.19	)		–			(0.19	)		12.54	3.22
2010		10.89		0.17		1.45		1.62		(0.18	)		–			(0.18	)		12.33	15.03
SAM CONSERVATIVE BALANCED PORTFOLIO
Class A shares
2014		12.05		0.25		0.58		0.83		(0.24	)		(0.23	)		(0.47	)		12.41	7.10
2013		11.22		0.25		0.89		1.14		(0.25	)		(0.06	)		(0.31	)		12.05	10.41
2012		10.56		0.27		0.70		0.97		(0.26	)		(0.05	)		(0.31	)		11.22	9.39
2011		10.46		0.30		0.10		0.40		(0.30	)		–			(0.30	)		10.56	3.81
2010		9.47		0.29		1.00		1.29		(0.30	)		–			(0.30	)		10.46	13.84
Class B shares
2014		12.06		0.18		0.56		0.74		(0.14	)		(0.23	)		(0.37	)		12.43	6.30
2013		11.22		0.18		0.88		1.06		(0.16	)		(0.06	)		(0.22	)		12.06	9.57
2012		10.55		0.18		0.70		0.88		(0.16	)		(0.05	)		(0.21	)		11.22	8.48
2011		10.44		0.22		0.09		0.31		(0.20	)		–			(0.20	)		10.55	3.00
2010		9.45		0.22		0.98		1.20		(0.21	)		–			(0.21	)		10.44	12.89
Class C shares
2014		11.95		0.16		0.58		0.74		(0.16	)		(0.23	)		(0.39	)		12.30	6.30
2013		11.13		0.16		0.89		1.05		(0.17	)		(0.06	)		(0.23	)		11.95	9.60
2012		10.48		0.18		0.70		0.88		(0.18	)		(0.05	)		(0.23	)		11.13	8.57
2011		10.38		0.22		0.10		0.32		(0.22	)		–			(0.22	)		10.48	3.07
2010		9.40		0.22		0.99		1.21		(0.23	)		–			(0.23	)		10.38	12.99


FINANCIAL HIGHLIGHTS PRINCIPAL FUNDS, INC.
FINANCIAL HIGHLIGHTS PRINCIPAL FUNDS, INC.


Selected data for a share of Capital Stock outstanding throughout each year ended October 31:
		Net Asset		Net		Net Realized				Dividends			Distributions			Total
		Value,		Investment		and Unrealized		Total From		from Net			from			Dividends			Net Asset
		Beginning		Income		Gain (Loss) on		Investment		Investment			Realized			and			Value, End
		of Period		(Loss)(a)		Investments		Operations		Income			Gains			Distributions			of Period	Total Return(b)
SAM CONSERVATIVE GROWTH PORTFOLIO
Class A shares
2014	$	17.53	$	0.21	$	1.50	$	1.71	($	0.23	)	($	0.15	)	($	0.38	)	$	18.86	9.90	%
2013		14.73		0.22		2.81		3.03		(0.23	)		–			(0.23	)		17.53	20.88
2012		13.48		0.19		1.26		1.45		(0.20	)		–			(0.20	)		14.73	10.92
2011		13.13		0.19		0.35		0.54		(0.19	)		–			(0.19	)		13.48	4.10
2010		11.38		0.17		1.77		1.94		(0.19	)		–			(0.19	)		13.13	17.21
Class B shares
2014		16.92		0.13		1.38		1.51		(0.03	)		(0.15	)		(0.18	)		18.25	9.00
2013		14.18		0.11		2.69		2.80		(0.06	)		–			(0.06	)		16.92	19.86
2012		12.94		0.09		1.21		1.30		(0.06	)		–			(0.06	)		14.18	10.06
2011		12.59		0.09		0.32		0.41		(0.06	)		–			(0.06	)		12.94	3.27
2010		10.92		0.08		1.68		1.76		(0.09	)		–			(0.09	)		12.59	16.22
Class C shares
2014		16.59		0.08		1.40		1.48		(0.11	)		(0.15	)		(0.26	)		17.81	9.05
2013		13.95		0.09		2.68		2.77		(0.13	)		–			(0.13	)		16.59	20.01
2012		12.77		0.08		1.20		1.28		(0.10	)		–			(0.10	)		13.95	10.09
2011		12.44		0.09		0.33		0.42		(0.09	)		–			(0.09	)		12.77	3.38
2010		10.80		0.07		1.68		1.75		(0.11	)		–			(0.11	)		12.44	16.29
SAM FLEXIBLE INCOME PORTFOLIO
Class A shares
2014		12.37		0.32		0.46		0.78		(0.32	)		(0.19	)		(0.51	)		12.64	6.44
2013		11.99		0.33		0.50		0.83		(0.34	)		(0.11	)		(0.45	)		12.37	7.09
2012		11.32		0.36		0.68		1.04		(0.35	)		(0.02	)		(0.37	)		11.99	9.30
2011		11.31		0.40		0.01		0.41		(0.40	)		–			(0.40	)		11.32	3.64
2010		10.44		0.39		0.90		1.29		(0.42	)		–			(0.42	)		11.31	12.61
Class B shares
2014		12.39		0.22		0.44		0.66		(0.20	)		(0.19	)		(0.39	)		12.66	5.45
2013		12.00		0.22		0.50		0.72		(0.22	)		(0.11	)		(0.33	)		12.39	6.10
2012		11.32		0.27		0.68		0.95		(0.25	)		(0.02	)		(0.27	)		12.00	8.43
2011		11.31		0.31		–		0.31		(0.30	)		–			(0.30	)		11.32	2.74
2010		10.43		0.30		0.90		1.20		(0.32	)		–			(0.32	)		11.31	11.69
Class C shares
2014		12.27		0.22		0.45		0.67		(0.22	)		(0.19	)		(0.41	)		12.53	5.61
2013		11.90		0.23		0.50		0.73		(0.25	)		(0.11	)		(0.36	)		12.27	6.25
2012		11.23		0.27		0.68		0.95		(0.26	)		(0.02	)		(0.28	)		11.90	8.56
2011		11.23		0.31		–		0.31		(0.31	)		–			(0.31	)		11.23	2.80
2010		10.36		0.30		0.90		1.20		(0.33	)		–			(0.33	)		11.23	11.81


FINANCIAL HIGHLIGHTS PRINCIPAL FUNDS, INC.
FINANCIAL HIGHLIGHTS PRINCIPAL FUNDS, INC.


Selected data for a share of Capital Stock outstanding throughout each year ended October 31:


		Net Asset		Net		Net Realized				Dividends			Distributions			Total
		Value,		Investment		and Unrealized		Total From		from Net			from			Dividends			Net Asset
		Beginning		Income		Gain (Loss) on		Investment		Investment			Realized			and			Value, End
		of Period		(Loss)(a)		Investments		Operations		Income			Gains			Distributions			of Period	Total Return(b)
SAM STRATEGIC GROWTH PORTFOLIO
Class A shares
2014	$	19.91	$	0.21	$	2.03	$	2.24	($	0.22	)	($	0.14	)	($	0.36	)	$	21.79	11.39	%
2013		16.13		0.19		3.79		3.98		(0.20	)		–			(0.20	)		19.91	24.92
2012		14.61		0.12		1.52		1.64		(0.12	)		–			(0.12	)		16.13	11.31
2011		14.18		0.12		0.44		0.56		(0.13	)		–			(0.13	)		14.61	3.96
2010		12.14		0.12		2.07		2.19		(0.15	)		–			(0.15	)		14.18	18.15
Class B shares
2014		18.66		0.11		1.83		1.94		(0.01	)		(0.14	)		(0.15	)		20.45	10.46
2013		15.08		0.08		3.52		3.60		(0.02	)		–			(0.02	)		18.66	23.89
2012		13.66		0.01		1.41		1.42		–			–			–			15.08	10.40
2011		13.25		0.01		0.41		0.42		(0.01	)		–			(0.01	)		13.66	3.14
2010		11.35		0.03		1.92		1.95		(0.05	)		–			(0.05	)		13.25	17.25
Class C shares
2014		18.61		0.05		1.89		1.94		(0.09	)		(0.14	)		(0.23	)		20.32	10.54
2013		15.09		0.06		3.54		3.60		(0.08	)		–			(0.08	)		18.61	24.00
2012		13.67		0.01		1.42		1.43		(0.01	)		–			(0.01	)		15.09	10.47
2011		13.27		0.01		0.42		0.43		(0.03	)		–			(0.03	)		13.67	3.26
2010		11.39		0.03		1.92		1.95		(0.07	)		–			(0.07	)		13.27	17.14

We have audited the accompanying statements of assets and liabilities, including the schedules of investments, of Principal LifeTime 2010 Fund, Principal LifeTime 2020 Fund, Principal LifeTime 2030 Fund, Principal LifeTime 2040 Fund, Principal LifeTime 2050 Fund, Principal LifeTime Strategic Income Fund, SAM Balanced Portfolio, SAM Conservative Balanced Portfolio, SAM Conservative Growth Portfolio, SAM Flexible Income Portfolio, and SAM Strategic Growth Portfolio, (11 of the portfolios constituting Principal Funds, Inc., collectively, the “Funds”), as of October 31, 2014, and the related statements of operations for the year then ended, statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Funds’ internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of October 31, 2014, by correspondence with the custodian and transfer agent of the affiliated funds. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of each of the Funds listed above constituting portfolios within Principal Funds, Inc., at October 31, 2014, the results of their operations for the year then ended, the changes in their net assets for each of the two years in the period then ended, and their financial highlights for each of the five years then ended, in conformity with U.S. generally accepted accounting principles.

SHAREHOLDER EXPENSE EXAMPLE
PRINCIPAL FUNDS, INC.
October 31, 2014 (unaudited)

As a shareholder of Principal Funds, Inc., you incur two types of costs: (1) transaction costs, including sales charges on purchase payments and contingent deferred sales charges; and (2) ongoing costs, including management fees; distribution fees; and other fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in Principal Funds, Inc. and to compare these costs with the ongoing costs of investing in other mutual funds. As a shareholder of Principal LifeTime 2010 Fund, Principal LifeTime 2020 Fund, Principal LifeTime 2030 Fund, Principal LifeTime 2040 Fund, Principal LifeTime 2050 Fund, Principal LifeTime Strategic Income Fund, SAM Balanced Portfolio, SAM Conservative Balanced Portfolio, SAM Conservative Growth Portfolio, SAM Flexible Income Portfolio, or SAM Strategic Growth Portfolio, your fund will indirectly bear its pro rata share of the expenses incurred by the investment companies in which the fund invests. These expenses are not included in the fund’s annualized expense ratio used to calculate the expenses paid in this example. If they were, the expenses paid would be higher.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (May 1, 2014 to October 31, 2014), unless otherwise noted.


				Actual							Hypothetical
						Expenses Paid							Expenses Paid
				Ending		During Period					Ending		During Period
		Beginning		Account Value		May 1, 2014 to			Beginning		Account Value		May 1, 2014 to		Annualized
		Account Value		October 31,		October 31,			Account Value		October 31,		October 31,		Expense
		May 1, 2014		2014		2014	^**		May 1, 2014		2014		2014	^**	Ratio
Principal LifeTime 2010 Fund
Class A	$	1,000.00	$	1,024.57	$	2.09		$	1,000.00	$	1,023.14	$	2.09		0.41	%

Principal LifeTime 2020 Fund
Class A		1,000.00		1,031.66		2.10			1,000.00		1,023.14		2.09		0.41
Class B		1,000.00		1,028.63		5.93			1,000.00		1,019.36		5.90		1.16

Principal LifeTime 2030 Fund
Class A		1,000.00		1,038.15		2.11			1,000.00		1,023.14		2.09		0.41
Class B		1,000.00		1,033.62		5.95			1,000.00		1,019.36		5.90		1.16

Principal LifeTime 2040 Fund
Class A		1,000.00		1,041.67		2.11			1,000.00		1,023.14		2.09		0.41
Class B		1,000.00		1,036.94		5.96			1,000.00		1,019.36		5.90		1.16

Principal LifeTime 2050 Fund
Class A		1,000.00		1,042.92		2.11			1,000.00		1,023.14		2.09		0.41
Class B		1,000.00		1,038.85		5.96			1,000.00		1,019.36		5.90		1.16

Principal LifeTime Strategic Income Fund
Class A		1,000.00		1,019.90		2.09			1,000.00		1,023.14		2.09		0.41
Class B		1,000.00		1,015.78		5.89			1,000.00		1,019.36		5.90		1.16


				SHAREHOLDER EXPENSE EXAMPLE
PRINCIPAL FUNDS, INC.
October 31, 2014 (unaudited)



				Actual							Hypothetical
						Expenses Paid							Expenses Paid
				Ending		During Period					Ending		During Period
		Beginning		Account Value		May 1, 2014 to			Beginning		Account Value		May 1, 2014 to		Annualized
		Account Value		October 31,		October 31,			Account Value		October 31,		October 31,		Expense
		May 1, 2014		2014		2014	^**		May 1, 2014		2014		2014	^**	Ratio
SAM Balanced Portfolio
Class A	$	1,000.00	$	1,038.64	$	3.29		$	1,000.00	$	1,021.98	$	3.26		0.64	%
Class B		1,000.00		1,034.74		7.03			1,000.00		1,018.30		6.97		1.37
Class C		1,000.00		1,034.58		7.18			1,000.00		1,018.15		7.12		1.40

SAM Conservative Balanced Portfolio
Class A		1,000.00		1,031.65		3.23			1,000.00		1,022.03		3.21		0.63
Class B		1,000.00		1,027.31		7.05			1,000.00		1,018.25		7.02		1.38
Class C		1,000.00		1,028.10		7.05			1,000.00		1,018.25		7.02		1.38

SAM Conservative Growth Portfolio
Class A		1,000.00		1,046.03		3.35			1,000.00		1,021.93		3.31		0.65
Class B		1,000.00		1,042.26		7.21			1,000.00		1,018.15		7.12		1.40
Class C		1,000.00		1,042.13		7.21			1,000.00		1,018.15		7.12		1.40

SAM Flexible Income Portfolio
Class A		1,000.00		1,027.13		3.22			1,000.00		1,022.03		3.21		0.63
Class B		1,000.00		1,022.70		7.44			1,000.00		1,017.85		7.43		1.46
Class C		1,000.00		1,022.64		7.14			1,000.00		1,018.15		7.12		1.40

SAM Strategic Growth Portfolio
Class A		1,000.00		1,057.25		3.42			1,000.00		1,021.88		3.36		0.66
Class B		1,000.00		1,053.04		7.40			1,000.00		1,018.00		7.27		1.43
Class C		1,000.00		1,053.40		7.35			1,000.00		1,018.05		7.22		1.42

^**Expenses are equal to a fund's annualized expense ratio multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).

The following directors are considered not to be “interested persons” as defined in the 1940 Act


		Number of	Other
Name,		Portfolios in Fund	Directorships
Position Held with the Fund,	Principal Occupation(s)	Complex Overseen by	Held by Director
Year of Birth	During past 5 years	Director	During Past 5 Years
Elizabeth Ballantine	Principal, EBA Associates	117	Durango Herald, Inc;
Director since 2004			McClatchy
Member, Nominating and Governance			Newspapers, Inc.
Committee
1948

Leroy T. Barnes, Jr.	Retired.	117	McClatchy
Director since March 2012			Newspapers, Inc.;
Member, Audit Committee			Herbalife Ltd.; Frontier
1951			Communications, Inc.;
			Longs Drug Stores

Craig Damos	President, The Damos	117	Hardin Construction
Director since 2008	Company. Formerly, CEO, The		Company
Member, Audit Committee	Weitz Company
Member, 15(c) Committee
1954

Mark A. Grimmett	Executive Vice President and	117	None
Director since 2004	CFO, Merle Norman Cosmetics,
Member, Nominating and Governance	Inc.
Committee
Member, 15(c) Committee
Member, Executive Committee
1960

Fritz S. Hirsch	CEO, MAM USA	117	Focus Products Group
Director since 2005	Formerly, President, Sassy, Inc.
Member, Operations Committee
Member, 15(c) Committee
1951

Tao Huang	Formerly, Chief Operating	117	Armstrong World
Director since March 2012	Officer, Morningstar, Inc.		Industries, Inc.
Member, Operations Committee
Member, 15(c) Committee
1962

William C. Kimball	Partner, Kimball – Porter	117	Casey’s General Stores,
Director since 1999	Investments L.L.C.		Inc.
Member, Nominating and Governance
Committee
1947

Karen (“Karrie”) McMillan	Formerly, General Counsel,	117	None
Director since September 2014	Investment Company Institute
Member, Operations Committee
1961

Daniel Pavelich	Retired.	117	None
Director since 2007
Member, Audit Committee
Member, 15(c) Committee
1944

The following directors are considered to be “interested persons” as defined in the 1940 Act, as amended, because of an affiliation with the Manager and Principal Life.


		Number of
		Portfolios in Fund	Other
Name,		Complex	Directorships
Position Held with the Fund,	Principal Occupation(s)	Overseen by	Held by Director
Year of Birth	During past 5 years	Director	During Past 5 Years
Michael J. Beer	Executive Vice President, Principal	117	None
Director since 2012	Funds Distributor, Inc. (“PFD”)
Executive Vice President	Vice President/Mutual Funds and
Member, Executive Committee	Broker Dealer, Principal Life
1961	Insurance Company (“PLIC”)
	Director, Principal Management
	Corporation, (the “Manager”)
	Executive Vice President/ Chief
	Operating Officer, the Manager
	Director, Princor
	President, Princor
	Director, Principal Shareholder
	Services (“PSS”) since 2011
	President, PSS since 2011

Nora M. Everett	Director, Edge (2008-2011)	117	None
Director since 2008	Director, Finisterre since 2011
President, CEO, and Chairman	Chairman, Principal Financial
Member, Executive Committee	Advisors, Inc. (“PFA”) since 2010
1959	Chairman, PFD since 2011
	Senior Vice President/Retirement and
	Investor Services, PLIC
	Chairman, the Manager since 2011
	President, the Manager since 2008
	Chairman, Princor since 2011
	Chief Executive Officer, Princor since
	2009
	Chairman, PSS since 2011

Correspondence intended for each Director who is other than an Interested Director may be sent to 711 High Street, Des Moines, IA

Name, Position Held with the Fund, Address, and Year of Birth

Randy L. Bergstrom Assistant Tax Counsel

711 High Street, Des Moines, IA 50392 1955

David J. Brown

Chief Compliance Officer

711 High Street, Des Moines, IA 50392 1960

Principal Occupation(s) During past 5 years

Counsel, Principal Global Investors, LLC (“PGI”) Counsel, PLIC

Senior Vice President, PFD

Vice President/Compliance, PLIC

Senior Vice President, the Manager Senior Vice President, Princor Senior Vice President, PSS

Teresa M. Button Treasurer

711 High Street, Des Moines, IA 50392 1963

Vice President/Treasurer, Edge since 2011 Vice President/Treasurer, PFA since 2011

Ernie H. Gillum

Vice President, Assistant Secretary 711 High Street, Des Moines, IA 50392 1955

Carolyn F. Kolks Assistant Tax Counsel

711 High Street, Des Moines, IA 50392 1962

Jennifer A. Mills Assistant Counsel

711 High Street, Des Moines, IA 50392 1973

Vice President/Chief Compliance Officer, the Manager

Vice President/Chief Compliance Officer, PSS

Counsel, PGI Counsel, PLIC

Counsel, PFD (2009-2013) Counsel, PLIC

Counsel, the Manager (2009-2013) Counsel, Princor (2009-2013) Counsel, PSS (2009-2013)

Layne A. Rasmussen

Vice President, Controller, and CFO 711 High Street, Des Moines, IA 50392 1958

Michael D. Roughton Counsel

711 High Street, Des Moines, IA 50392 1951

Vice President/Controller – Principal Funds, the Manager

Senior Vice President/Counsel, PFA Senior Vice President/Counsel, PFD

Vice President & Associate General Counsel, PLIC Senior Vice President/Counsel, the Manager Senior Vice President/Counsel, Princor (2009-2013) Senior Vice President/Counsel, PSS

Britney L. Schnathorst

Assistant Counsel 1981

Counsel, PLIC since 2013

Prior thereto, Attorney in Private Practice

Name, Position Held with the Fund, Address, and Year of Birth

Adam U. Shaikh Assistant Counsel

711 High Street, Des Moines, IA 50392 1972

Principal Occupation(s) During past 5 years

Counsel, PFD (2006-2013) Counsel, PLIC

Counsel, the Manager (2007-2013) Counsel, Princor (2007-2013) Counsel, PSS (2007-2013)

Dan Westholm Assistant Treasurer

711 High Street, Des Moines, IA 50392 1966

Assistant Vice President/Treasury, PFA since 2013 Director – Treasury, PFA (2011-2013)

Assistant Vice President/Treasury, PFD since 2013 Director – Treasury, PFD (2011-2013) Assistant Vice President/Treasury, PLIC

Assistant Vice President/Treasury, the Manager Assistant Vice President/Treasury, Princor since 2013 Director – Treasury, Princor (2008-2009, 2011-2013) Assistant Vice President/Treasury, PSS

Beth Wilson

Vice President and Secretary

711 High Street, Des Moines, IA 50392 1956

Vice President, the Manager (2007-2013)

Vice President, Princor (2007-2009)

The 15(c) Committee assists the Board in performing the annual review of the Fund’s advisory and sub-advisory agreements pursuant to Section 15(c) of the 1940 Act.

Annual Review and Renewal of Management Agreement and Subadvisory Agreements

At its September 9, 2014 meeting, the Board performed its annual review and renewal process relating to the Management Agreement and the Subadvisory Agreements for all Funds.

Qualified Dividend Income. Certain dividends paid by the Funds may be subject to a maximum tax rate of 15%, as provided for by the Jobs and Growth Tax

Relief Reconciliation Act of 2003. The percentage of ordinary income distributions for the fiscal year ended October 31, 2014, taxed at a maximum rate of 15% is as follows:

This information is given to meet certain requirements of the Internal Revenue Code and should not be used by shareholders for preparing their income tax returns.

For tax return preparation purposes, please refer to the information supplied with the 1099-DIV form you will receive from the Fund’s transfer agent.

GLOBAL INVESTMENT MANAGEMENT • ASSET ALLOCATION EXPERTISE • RETIREMENT LEADERSHIP

Distributed by: Principal Funds Distributor, Inc., Member FINRA, 1100 Investment Blvd., Suite 200, El Dorado Hills, CA 95762

A mutual fund’s share price and investment return will vary with market conditions, and the principal value of an investment when you sell your shares may be more or less than the original cost.

Principal Funds, Inc. is distributed by Principal Funds Distributor, Inc., 800-222-5852, member of the Principal Financial Group^®. Principal Funds Distributor, Principal Shareholder Services, Principal Management Corporation and its affiliates, and Principal Funds, Inc. are collectively referred to as Principal Funds.

Note: if your shares are not held directly with Principal Funds but through a brokerage firm, please contact your broker for electronic delivery options available.

GLOBAL INVESTMENT MANAGEMENT •ASSET ALLOCATION EXPERTISE •RETIREMENT LEADERSHIP

Whatever your financial goals, we have a wide range of mutual funds to help you succeed.

What contributed to or detracted from Fund performance during the fiscal year?

Performance was in line with the peer group. The portfolio continues to have a core holding of variable rate demand notes (VRDNs) that meet the need for weekly liquidity at a higher yield versus other options. The Principal Money Market Fund was not short average days to maturity, so there were no detractors.

* Variable rate demand notes are debt instruments representing borrowed funds that are payable on demand and accrue interest based on a prevailing money market rate.

A contingent deferred sales charge may apply as follows: Class J shares: 1% on redemptions made during the first 18 months. See the prospectus for details. Performance listed with sales charge reflects the maximum sales charge.

An investment in the Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.

Where gross and net expenses differ, Principal Management Corporation has contractually agreed to limit the investment option’s expenses. Expense limits apply through 02/28/15 for Class J. Returns displayed are based on net total investment expense.

* Performance assumes reinvestment of all dividends and capital gains. Performance does not reflect the impact of federal, state, or municipal taxes. If it did, performance would be lower.

** Principal has voluntarily agreed to limit the Fund’s expenses to the extent necessary to maintain a 0% yield. The voluntary expense limit may be terminated at any time.

*** The 7-day simple yield is calculated based on the income generated by an investment in the fund over a 7-day period and is expressed as an annual percentage rate. The 7-day effective yield is calculated similarly to the 7-day simple yield but assumes that income earned from the fund’s investment is reinvested and compounded.


	STATEMENT OF ASSETS AND LIABILITIES
	PRINCIPAL FUNDS, INC.
	October 31, 2014

			Money
Amounts in thousands, except per share amounts			Market Fund
Investment in securities--at cost		$	1,083,038
Assets
Investment in securities--at value		$	1,083,038
Cash			12
Receivables:
Dividends and interest			47
Expense reimbursement from Manager			356
Expense reimbursement from Distributor			18
Fund shares sold			2,901
Other assets			26
	Total Assets		1,086,398
Liabilities
Accrued management and investment advisory fees			364
Accrued distribution fees			71
Accrued transfer agent fees			229
Accrued other expenses			122
Payables:
Fund shares redeemed			5,889
	Total Liabilities		6,675
Net Assets Applicable to Outstanding Shares		$	1,079,723
Net Assets Consist of:
Capital shares and additional paid-in-capital		$	1,120,963
Accumulated undistributed (overdistributed) net realized gain (loss)			(41,240	)
	Total Net Assets	$	1,079,723
Capital Stock (par value: $.01 per share):
Shares authorized			8,400,000
Net Asset Value Per Share:
Class A: Net Assets	$		471,109
Shares Issued and Outstanding			471,013
Net Asset Value per share	$		1.00
Maximum Offering Price	$		1.00
Class B: Net Assets	$		3,342
Shares Issued and Outstanding			3,341
Net Asset Value per share	$		1.00	^(a)
Class C: Net Assets	$		17,977
Shares Issued and Outstanding			17,973
Net Asset Value per share	$		1.00	^(a)
Class J: Net Assets	$		249,914
Shares Issued and Outstanding			249,864
Net Asset Value per share	$		1.00	^(a)
Institutional: Net Assets	$		337,381
Shares Issued and Outstanding			337,313
Net Asset Value per share	$		1.00


STATEMENT OF OPERATIONS
PRINCIPAL FUNDS, INC.
Year Ended October 31, 2014

Amounts in thousands	Money Market Fund
Net Investment Income (Loss)
Income:
Interest	$	1,806
Total Income		1,806
Expenses:
Management and investment advisory fees		4,274
Distribution fees - Class B		47
Distribution fees - Class C		173
Distribution fees - Class J		649
Registration fees - Class A		111
Registration fees - Class B		19
Registration fees - Class C		21
Registration fees - Class J		40
Registration fees - Institutional		54
Shareholder reports - Class A		51
Shareholder reports - Class B		1
Shareholder reports - Class C		2
Shareholder reports - Class J		85
Shareholder reports - Institutional		2
Transfer agent fees - Class A		477
Transfer agent fees - Class B		10
Transfer agent fees - Class C		24
Transfer agent fees - Class J		321
Transfer agent fees - Institutional		13
Custodian fees		11
Directors' expenses		19
Professional fees		30
Other expenses		12
Total Gross Expenses		6,446
Less: Reimbursement from Manager - Class A		1,712
Less: Reimbursement from Manager - Class B		77
Less: Reimbursement from Manager - Class C		87
Less: Reimbursement from Manager - Class J		1,681
Less: Reimbursement from Manager - Institutional		877
Less: Reimbursement from Distributor - Class B		12
Less: Reimbursement from Distributor - Class C		174
Less: Reimbursement from Distributor - Class J		22
Total Net Expenses		1,804
Net Investment Income		2

Net Realized and Unrealized Gain (Loss) on Investments
Net realized gain from:
Investment transactions		219
Net Realized and Unrealized Gain on Investments		219
Net Increase in Net Assets Resulting from Operations	$	221


STATEMENT OF CHANGES IN NET ASSETS
PRINCIPAL FUNDS, INC.



Amounts in thousands																				Money Market Fund
																				Year Ended			Year Ended
																				October 31, 2014			October 31, 2013
Operations
Net investment income																			$	2			$	–
Net realized gain on investments																				219				149
Change in unrealized appreciation/depreciation of investments																				–				–
										Net Increase in Net Assets Resulting from Operations										221				149


Capital Share Transactions
Net increase (decrease) in capital share transactions																				(57,081	)			12,653
														Total Increase (Decrease) in Net Assets						(56,860	)			12,802

Net Assets
Beginning of period																				1,136,583			1,123,781
End of period (including undistributed net investment income as set forth below)																			$	1,079,723		$	1,136,583
Undistributed (overdistributed) net investment income (loss)																			$	–			$	(2	)

			Class A			Class B				Class C			Class J			Institutional
Capital Share Transactions:
Year Ended October 31, 2014
Dollars:
Sold	$	474,113		$		500		$		15,971		$	117,768			$242,449
Redeemed			(475,605)			(3,544	)			(19,230	)		(146,440		)	(263,063		)
Net Increase (Decrease)		$	(1,492)		$	(3,044)			$	(3,259)		$		(28,672)			$ (20,614)
Shares:
Sold			474,115			499				15,971			117,768			242,450
Redeemed			(475,606)			(3,544	)			(19,230	)		(146,440		)	(263,063		)
Net Increase (Decrease)			(1,491)			(3,045	)			(3,259	)		(28,672		)	(20,613		)
Year Ended October 31, 2013
Dollars:
Sold	$	598,551		$		2,350		$		26,882		$	180,552			$578,995
Redeemed			(584,145)			(8,230	)			(22,972	)		(184,630		)	(574,700		)
Net Increase (Decrease)		$	14,406	$		(5,880)			$	3,910			$	(4,078)			$4,295
Shares:
Sold			598,551			2,350				26,881			180,552			578,995
Redeemed			(584,145)			(8,230	)			(22,972	)		(184,630		)	(574,700		)
Net Increase (Decrease)			14,406			(5,880	)			3,909				(4,078	)		4,295

Distributions:
Year Ended October 31, 2014
From net investment income $			–	$		–		$		–			$	–			$–
From net realized gain on
investments			–			–				–				–			–
Total Dividends and Distributions $			–	$		–		$		–			$	–			$–
Year Ended October 31, 2013
From net investment income $			–	$		–		$		–			$	–			$–
From net realized gain on
investments			–			–				–				–			–
Total Dividends and Distributions $			–	$		–		$		–			$	–			$–

Principal Funds, Inc. is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company and operates in the mutual fund industry. The financial statements for Money Market Fund are presented herein. Money Market Fund offers four classes of shares: Class A, Class C, Class J and Institutional. Class B shares of Money Market Fund are no longer available for purchase. Information presented in these financial statements pertains to the Class J shares. Certain detailed information for the other classes of shares is provided separately.

Money Market Fund is an investment company and applies specialized accounting and reporting under Accounting Standards Codification Topic 946, Financial Services - Investment Companies. Money Market Fund was an investment company at all times during the period. Money Market Fund has not provided financial support, and is not contractually required to provide financial support to any investee.

All classes of shares represent interests in the same portfolio of investments, and will vote together as a single class except where otherwise required by law or as determined by the Board of Directors of Principal Funds, Inc. In addition, the Board of Directors declares separate dividends on each class of shares.

Security Valuation. The Fund values its securities, other than holdings of other publicly traded investment funds, at amortized cost, which approximates fair value, as permitted under Rule 2a-7 of the Investment Company Act of 1940. Other publicly traded investment funds are valued at the funds’ net asset value. Under the amortized cost method, a security is valued by applying a constant yield to maturity of the difference between the principal amount due at maturity and the cost of the security to the Fund.

Income and Investment Transactions. The Fund records investment transactions on a trade date basis. The identified cost basis has been used in determining the net realized gain or loss from investment transactions. Interest income is recognized on an accrual basis. The Fund allocates daily all income and realized gains or losses to each class of shares based upon the relative proportion of the number of settled shares outstanding of each class.

The Fund’s investments are with various issuers in various industries. The schedule of investments contained herein summarizes concentration of credit risk by issuer and industry.

Expenses. Expenses directly attributed to a Fund are charged to that Fund. Other Fund expenses not directly attributed to a Fund are apportioned among the Funds managed by Principal Management Corporation (the “Manager”).

The Fund allocates daily all expenses (other than class-specific expenses) to each class of shares based upon the relative proportion of the number of settled shares outstanding of each class. Class-specific expenses charged to each class during the year ended October 31, 2014, are included separately in the statement of operations.

Distributions to Shareholders. The Fund declares all net investment income and any net realized gains from investment transactions as dividends daily to settled shares of record as of that day. Dividends from net investment income and net realized gain from investments are determined in accordance with federal tax regulations, which may differ from U.S. generally accepted accounting principles.

Federal Income Taxes. No provision for federal income taxes is considered necessary because the Fund is qualified as a “regulated investment company” under the Internal Revenue Code and intends to distribute each year substantially all of its net investment income and realized capital gains to shareholders.

The Fund evaluates tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is “more likely than not” that each tax position would be sustained upon examination by a taxing authority based on the technical merits of the position. Tax positions not deemed to meet the more likely than not threshold would be recorded as a tax benefit or expense in the current year. During the year ended October 31, 2014, the Fund did not record any such tax benefit or expense in the accompanying financial statements. The statute of limitations remains open for the fiscal years from 2011-2014. No examinations are in progress or anticipated at this time.

In addition, Money Market Fund participates with other registered investment companies managed by the Manager in an unsecured joint line of credit with a bank which allows the participants to borrow up to $75 million, collectively. Borrowings are made solely to facilitate the handling of unusual and/or unanticipated short-term cash requirements. Interest is charged to each participant, based on its borrowings, at a rate equal to the higher of the Federal Funds Rate or the One Month LIBOR rate plus 1.00%. Additionally, a commitment fee is charged at an annual rate of .08% on the amount of the line of credit. Money Market Fund did not borrow against the line of credit during the year ended October 31, 2014.

Indemnification. Under the Fund’s by-laws present and past officers, directors and employees are indemnified against certain liabilities arising out of the performance of their duties. In addition, in the normal course of business the Fund may enter into a variety of contracts that may contain representations and warranties which provide general indemnifications. The Fund’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Fund.

Repurchase Agreements. The Fund may invest in repurchase agreements that are fully collateralized, typically by U.S. government or U.S. government agency securities. It is the Fund’s policy that its custodian takes possession of the underlying collateral securities. The fair value of the collateral is at all times at least equal to the total amount of the repurchase obligation. In the event of default on the obligation to repurchase, the Fund has the right to liquidate the collateral and apply the proceeds in satisfaction of the obligation. In the event the seller of a repurchase agreement defaults, the Fund could experience delays in the realization of the collateral.

Fair value is defined as the price that the Fund would receive upon selling a security in a timely transaction to an independent buyer in the principal or most advantageous market of the security at the measurement date. In determining fair value, the Fund uses various valuation approaches, including market, income and/or cost approaches. A hierarchy for inputs is used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available.

Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Fund. Unobservable inputs are inputs that reflect the Fund’s own estimates about the estimates market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.

The three-tier hierarchy of inputs is summarized in the three broad levels listed below.

ÏLevel 3 – Significant unobservable inputs (including the Fund’s assumptions in determining the fair value of investments.) Investments which are generally included in this category include certain corporate bonds and certain mortgage backed securities.

The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, for example, the type of security, whether the security is new and not yet established in the market place, and other characteristics particular to the transaction. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Fund in determining fair value is greatest for instruments categorized in Level 3.

Fair value is a market based measure considered from the perspective of a market participant who holds the asset rather than an entity specific measure. Therefore, even when market assumptions are not readily available, the Fund’s own assumptions are set to reflect those that market participants would use in pricing the asset or liability at the measurement date. The Fund uses prices and inputs that are current as of the measurement date.

The beginning of the period timing recognition is being adopted for transfers between levels of each Fund’s assets and liabilities. As of October 31, 2014, there were no transfers between Level 1 and Level 2.

As of October 31, 2014, all of the Fund’s investments were valued based on Level 2 inputs, with the exception of publicly traded investment funds, which are based on Level 1 inputs.

Management Services. The Fund has agreed to pay investment advisory and management fees to Principal Management Corporation (wholly owned by Principal Financial Services, Inc.) computed at an annual percentage rate of the Fund’s average daily net assets. A portion of the management fee is paid by Principal Management Corporation to the sub-advisor of the Fund, which is an affiliate of the Manager. The annual rates used in this calculation for the Fund are as follows:

Class A, Class B, Class C, and Institutional shares of Money Market Fund reimburse Principal Shareholder Services, Inc. (the “Transfer Agent”) (wholly owned by the Manager) for transfer agent services. Class J shares pays Principal Shareholder Services, Inc. a fee for the services provided in an amount that includes a profit.

The Manager has contractually agreed to limit the Fund’s expenses on certain share classes of the Fund. The reductions and reimbursements are in amounts that maintain total operating expenses at or below certain limits. The limits are expressed as a percentage of average daily net assets attributable to each respective class on an annualized basis. The operating expense limit for Class B and Class C shares is 1.55% and 1.79%, respectively. The expense limits will expire on February 28, 2015.

The Manager has voluntarily agreed to limit the Fund’s expenses for all classes of shares to the extent necessary to maintain a 0% yield. The voluntary expense limit may be terminated at any time.

Amounts owed to Money Market Fund under the terms of the expense limitation agreements are reflected in the statement of assets and liabilities as expense reimbursement from Manager.

Distribution Fees. The Class B, Class C and Class J shares of the Fund bear distribution fees. The fee is computed at an annual rate of the average daily net assets attributable to each class of the Fund. Distribution fees are paid to Principal Funds Distributor, Inc., the principal distributor of the Fund, a portion of the distribution fees may be paid to other selling dealers for providing certain services. The annual rates are 1.00%, 1.00% and .25% for Class B, Class C and Class J shares, respectively.

Principal Funds Distributor, Inc. has voluntarily agreed to limit the Fund’s distribution fees attributable to certain share classes of the Fund. The limit will maintain the level of distribution fees (expressed as a percent of average net assets on an annualized basis) not to exceed .75% for Class B and 0% for Class C shares. The limit may be terminated at any time.

Amounts owed to Money Market Fund under the terms of the expense limitation agreements are reflected in the statement of assets and liabilities as expense reimbursement from Distributor.

Affiliated Ownership. At October 31, 2014, Principal Life Insurance Company (an affiliate of the Manager), the Manager, Principal Funds Distributor, Inc., Princor Financial Services Corporation, Collective Investment Trusts sponsored by Principal Trust Company, benefit plans and separate accounts sponsored on behalf of Principal Life Insurance Company, and other affiliated entities owned 85,000 and 4,437,000 shares of Class A and Institutional shares, respectively.

Distributions to Shareholders. Money Market Fund did not make any distributions for the years ended October 31, 2014 and October 31, 2013.

Capital Loss Carryforward. Capital loss carryforwards are losses that can be used to offset future capital gains although it is unlikely the Fund will recognize future capital gains. As of October 31, 2014 the Fund had approximate net capital loss carryforwards as follows (amounts in thousands):

*In accordance with Sections 381-384 of the Internal Revenue Code, a portion of Money Market Fund’s losses have been subjected to an annual limitation.

As of October 31, 2014, Money Market Fund utilized capital loss carryforwards of $219,000.

Late-Year Losses. A regulated investment company may elect to treat any portion of its qualified late-year loss as arising on the first day of the next taxable year. Qualified late-year losses are certain capital and ordinary losses which occur during the portion of the Fund’s taxable year subsequent to October 31 and December 31, respectively. For the taxable year ended October 31, 2014, Money Market Fund does not intend to defer any late-year losses.

Management has evaluated events and transactions that have occurred through the date the financial statements were issued that would merit recognition or disclosure in the financial statements. On December 9, 2014, the Board of Directors approved a plan to convert all existing Class B shares into Class A shares. Effective at the close of business on February 23, 2015, all existing Class B shares will automatically convert to Class A shares without the imposition of the Class B contingent deferred sales charge. There were no other items requiring adjustment of the financial statements or additional disclosure.


INVESTMENT COMPANIES - 5.76%			Shares Held		Value (000's)				Principal
						BONDS (continued)			Amount (000's)		Value (000's)
Publicly Traded Investment Fund - 5.76%
Deutsche Money Market Series			19,980,000	$	19,980	Other Asset Backed Securities (continued)
Morgan Stanley Institutional Liquidity Funds -			20,000,000		20,000	GE Equipment Midticket LLC Series 2014-1
Government Portfolio						0.20%, 09/22/2015 ^(a)		$	2,129	$	2,129
STIT - Liquid Assets Portfolio			22,200,000		22,200	GE Equipment Small Ticket LLC Series 2014-
			$		62,180	1
TOTAL INVESTMENT COMPANIES			$		62,180	0.25%, 04/24/2015 ^(a),(b)			1,412		1,412
			Principal			GE Equipment Transportation LLC Series
BONDS- 13.11%			Amount (000's)		Value (000's)	2014-1
						0.20%, 06/23/2015 ^(a)			2,944		2,944
Automobile Asset Backed Securities - 5.13%						GreatAmerica Leasing Receivables
Ally Auto Receivables Trust 2014-2						0.25%, 03/15/2015 ^(a),(b)			1,008		1,008
0.20%, 10/15/2015 ^(a)		$	5,477	$	5,477	Macquarie Equipment Funding Trust 2014-A
Ally Auto Receivables Trust 2014-SN2						0.26%, 09/21/2015 ^(b)			5,071		5,071
0.25%, 10/20/2015 ^(a)			6,500		6,500	Volvo Financial Equipment LLC Series 2014-
AmeriCredit Automobile Receivables Trust						1
2014-2						0.21%, 03/16/2015 ^(b)			1,138		1,138
0.21%, 06/08/2015 ^(a)			1,893		1,893				$		19,711
ARI Fleet Lease Trust 2014-A						TOTAL BONDS			$		141,565
0.25%, 04/15/2015 ^(a),(b)			1,764		1,764
									Principal
Chrysler Capital Auto Receivables Trust 2014-						MUNICIPAL BONDS - 5.15%			Amount (000's)		Value (000's)
B
0.20%, 10/15/2015 ^(a),(b)			7,615		7,615	California - 0.45%
Enterprise Fleet Financing LLC						California Statewide Communities
0.25%, 08/20/2015 ^(b)			2,945		2,945	Development Authority (credit support from
GM Financial Automobile Leasing Trust						Fannie Mae)
2014-2						0.11%, 11/07/2014 ^(d)		$	100	$	100
0.25%, 09/21/2015 ^(b)			1,796		1,796	Kern Water Bank Authority (credit support
Mercedes Benz Auto Lease Trust 2014-A						from Wells Fargo)
0.20%, 04/15/2015 ^(a)			1,041		1,041	0.15%, 11/07/2014 ^(d)			4,700		4,700
Nissan Auto Lease Trust 2014-B									$		4,800
0.20%, 10/15/2015 ^(a)			7,100		7,100
						Colorado - 1.39%
Santander Drive Auto Receivables Trust 2014-						City of Colorado Springs CO Utilities System
2
0.25%, 05/15/2015 ^(a)			617		617	Revenue (credit support from Bank of
						America)
Volkswagen Auto Loan Enhanced Trust 2014-						0.15%, 11/07/2014 ^(d)			6,100		6,100
2
0.20%, 10/20/2015 ^(a)			6,500		6,500	Colorado Housing & Finance
						Authority (credit support from Federal Home

Wheels SPV 2 LLC			2,408		2,407	Loan Bank)
0.24%, 05/20/2015 (a),(b)						0.09%, 11/07/2014 ^(a),(d)			7,610		7,610
World Omni Auto Receivables Trust 2014-B						County of Kit Carson CO (credit support from
0.23%, 11/16/2015			4,800		4,800	Wells Fargo)
World Omni Automobile Lease Securitization						0.09%, 11/07/2014 ^(d)			1,280		1,280
Trust 2014-A
0.20%, 10/09/2015			4,969		4,969				$		14,990
			$		55,424	Illinois - 1.15%
						Memorial Health System/IL (credit support
Banks- 1.41	%					from JP Morgan Chase & Co)
JP Morgan Chase Bank NA						0.09%, 11/07/2014 ^(d)			12,405		12,405
0.42%, 12/21/2014 ^(a)			8,000		8,000
Wells Fargo Bank NA
0.37%, 11/20/2015 ^(a)			7,200		7,200	Indiana - 0.29%
			$		15,200	Ball State University Foundation Inc (credit
						support from US Bank)
Diversified Financial Services - 2.34%						0.10%, 11/03/2014 ^(d)			3,150		3,150
Corporate Finance Managers Inc
0.15%, 11/07/2014 ^(a)			10,250		10,250
MetLife Inc						Iowa- 0.23	%
0.30%, 08/17/2015 ^(a),(c)			15,000		15,000	Iowa Finance Authority (credit support from
			$		25,250	GNMA/FNMA/FHLMC)
						0.11%, 11/07/2014 ^(d)			2,500		2,500
Healthcare - Services - 0.92%
Portland Clinic LLP/The
0.11%, 11/07/2014 ^(a)			9,980		9,980	Maryland - 0.43%
						City of Baltimore MD (credit support from
						State Street Bank & Trust)
Insurance - 1.48%						0.09%, 11/07/2014 ^(d)			4,600		4,600
New York Life Global
0.22%, 07/24/2015 ^(a),(c)			16,000		16,000
						Minnesota - 0.46%
						City of St Paul MN (credit support from US
Other Asset Backed Securities - 1.83%						Bank)
CNH Equipment Trust 2014-A						0.15%, 11/07/2014 ^(d)			5,000		5,000
0.20%, 02/17/2015 ^(a)			1,872		1,872
Dell Equipment Finance Trust 2014-1
0.26%, 08/14/2015 ^(b)			4,137		4,137


			Principal					Principal
MUNICIPAL BONDS (continued)			Amount (000's)		Value (000's)	COMMERCIAL PAPER (continued)		Amount (000's)		Value (000's)

New Mexico - 0.39%						Banks (continued)
City of Las Cruces NM (credit support from						Skandinaviska Enskilda Banken AB
Wells Fargo)						0.15%, 12/29/2014 ^(b),(e)	$	6,000	$	5,999
0.15%, 11/07/2014 ^(d)		$	4,200	$	4,200	0.20%, 11/17/2014 ^(b),(e)		8,000		7,999
						0.22%, 01/08/2015 ^(b),(e)		5,000		4,998
						0.23%, 12/01/2014 ^(b),(e)		8,000		7,999
Oklahoma - 0.33%						Societe Generale SA
Oklahoma University Hospital (credit support						0.19%, 12/31/2014 ^(b),(e)		8,500		8,497
from Bank of America)
0.12%, 11/07/2014 ^(d)			3,600		3,600	Standard Chartered Bank/New York
						0.19%, 11/13/2014 ^(b)		8,400		8,399
						0.21%, 02/17/2015 ^(b)		8,000		7,995
Washington - 0.03%						0.23%, 12/18/2014 ^(b)		8,880		8,877
Washington State Housing Finance						Sumitomo Mitsui Banking Corp
Commission (credit support from Fannie						0.15%, 12/30/2014 ^(b),(e)		7,500		7,498
Mae)						0.20%, 12/09/2014 ^(b),(e)		4,000		3,999
0.13%, 11/07/2014 ^(d)			320		320	0.21%, 12/05/2014 ^(b),(e)		8,000		7,998
						0.22%, 12/10/2014 ^(b),(e)		7,000		6,998
TOTAL MUNICIPAL BONDS				$	55,565			$		266,321

			Principal			Consumer Products - 1.22%
COMMERCIAL PAPER - 68.53%			Amount (000's)		Value (000's)	Reckitt Benckiser Treasury Services
Agriculture - 0.31%						PLC (credit support from Reckitt Benckiser
Archer-Daniels-Midland Co						Group)
0.07%, 12/08/2014 ^(b)		$	2,000	$	2,000	0.21%, 12/04/2014 ^(b),(d)		5,450		5,449
Philip Morris International Inc						0.22%, 11/25/2014 ^(b),(d)		7,700		7,699
0.12%, 11/13/2014 ^(b)			1,350		1,350			$		13,148

			$		3,350	Diversified Financial Services - 26.11%
Automobile Manufacturers - 0.74%						Alpine Securitization Corp
BMW US Capital LLC (credit support from						0.19%, 11/07/2014 ^(b)		4,000		4,000
BMW AG)						0.19%, 11/12/2014 ^(b)		7,900		7,900
0.08%, 11/04/2014 ^(b),(d)			8,000		8,000	0.23%, 11/13/2014 ^(b)		4,511		4,511
						0.26%, 02/04/2015 ^(b)		8,500		8,494
						Anglesea Funding LLC
Banks- 24.67	%					0.14%, 11/03/2014 ^(b)		7,800		7,800
Bank of Tokyo-Mitsubishi UFJ Ltd/New York						AXA Financial Inc (credit support from AXA
NY						SA)
0.19%, 01/06/2015			7,000		6,998	0.20%, 12/01/2014 ^(b),(d)		5,000		4,999
0.20%, 12/03/2014			5,000		4,999	BNP Paribas Finance Inc (credit support from
Barclays Bank PLC						BNP Paribas)
0.19%, 12/11/2014			8,000		7,998	0.18%, 11/14/2014 ^(d)		7,800		7,799
0.22%, 01/09/2015			7,200		7,197	0.22%, 11/26/2014 ^(d)		7,000		6,999
Credit Suisse/New York NY						0.22%, 12/02/2014 ^(d)		7,000		6,999
0.22%, 11/05/2014			6,900		6,900	CAFCO LLC
0.22%, 12/17/2014			5,500		5,498	0.17%, 11/03/2014 ^(b)		7,600		7,600
0.22%, 12/23/2014			8,000		7,997	Collateralized Commercial Paper Co LLC
0.26%, 11/14/2014			5,000		5,000	0.15%, 01/05/2015		10,000		9,997
DNB Bank ASA						0.20%, 11/24/2014		9,000		8,999
0.15%, 12/29/2014 ^(b),(e)			7,500		7,498
0.20%, 01/16/2015 ^(b),(e)			7,000		6,997	Collateralized Commercial Paper II Co LLC
						0.25%, 11/24/2014 ^(b)		8,000		7,999
0.22%, 01/05/2015 ^(b),(e)			8,000		7,997
						Dealers Capital Access Trust Inc
HSBC USA Inc						0.20%, 11/07/2014		8,000		8,000
0.20%, 01/22/2015			5,300		5,298	0.20%, 11/19/2014		6,400		6,399
Manhattan Asset Funding Co LLC						0.21%, 12/08/2014		7,000		6,998
0.13%, 11/04/2014 ^(b)			6,900		6,900
0.15%, 12/02/2014 ^(b)			3,000		3,000	0.25%, 11/03/2014		5,000		5,000
0.16%, 11/19/2014 ^(b)			8,000		7,999	Fairway Finance LLC
						0.10%, 11/10/2014 ^(b)		6,000		6,000
0.18%, 12/04/2014 ^(b)			8,000		7,999
						Gemini Securitization Corp LLC
Mitsubishi UFJ Trust & Banking Corp/NY						0.18%, 11/07/2014 ^(b)		8,000		8,000
0.20%, 12/29/2014 ^(b)			7,500		7,498
						Gotham Funding Corp
Mizuho Funding LLC (credit support from						0.14%, 11/20/2014 ^(b)		5,000		5,000
Mizuho Corp Bank Ltd)						0.15%, 11/06/2014 ^(b)		8,000		8,000
0.20%, 11/04/2014 ^(b),(d)			7,000		7,000
						0.15%, 12/08/2014 ^(b)		6,000		5,999
0.20%, 11/21/2014 ^(b),(d)			7,500		7,499
						0.16%, 11/21/2014 ^(b)		7,400		7,399
0.21%, 02/18/2015 ^(b),(d)			8,000		7,995
						ING US Funding LLC (credit support from
MUFG Union Bank NA						ING Bank)
0.07%, 11/04/2014			8,000		8,000	0.20%, 02/02/2015 ^(d)		8,000		7,996
0.08%, 11/03/2014			6,000		6,000	0.23%, 11/10/2014 ^(d)		8,000		7,999
0.08%, 11/05/2014			7,800		7,800	0.29%, 02/20/2015 ^(d)		8,000		7,993
Nordea Bank AB						John Deere Financial Inc (credit support from
0.18%, 11/03/2014 ^(b),(e)			8,000		8,000
						John Deere Capital Corp)
Oversea-Chinese Banking Corp Ltd						0.08%, 11/18/2014 ^(b),(d)		8,000		8,000
0.19%, 11/13/2014 ^(e)			6,000		6,000
0.23%, 12/19/2014 ^(e)			7,000		6,998	JP Morgan Securities LLC
						0.15%, 11/12/2014		7,900		7,900


			Principal						Principal
COMMERCIAL PAPER (continued)			Amount (000's)		Value (000's)	COMMERCIAL PAPER (continued)		Amount (000's)			Value(000			's)

Diversified Financial Services (continued)						REITS - 0.65%
JP Morgan Securities LLC (continued)						Simon Property Group LP
0.20%, 11/17/2014 ^(b)		$	8,000	$	7,999		0.14%, 12/22/2014 ^(b)	$	7,000			$	6,999
Liberty Street Funding LLC
0.17%, 01/20/2015 ^(b)			7,000		6,997
0.18%, 12/10/2014 ^(b)			8,000		7,998	Retail - 1.48%
						Army and Air Force Exchange Service
National Rural Utilities Cooperative Finance							0.06%, 11/03/2014 ^(b)		16,000				16,000
Corp
0.09%, 11/28/2014			7,000		6,999
Nieuw Amsterdam Receivables Corp						Supranational Bank - 0.63%
0.12%, 11/05/2014 ^(b)			1,230		1,230	Corp Andina de Fomento
0.17%, 01/08/2015 ^(b)			3,000		2,999		0.24%, 11/14/2014 ^(b)		6,800				6,799
Sheffield Receivables Corp
0.14%, 12/12/2014 ^(b)			7,000		6,999
0.18%, 11/12/2014 ^(b)			8,000		8,000	Telecommunications - 1.96%
0.18%, 11/18/2014 ^(b)			7,000		6,999	Telstra Corp Ltd
							0.16%, 01/09/2015 ^(b)		7,420				7,418
0.22%, 02/03/2015 ^(b)			4,000		3,998
							0.20%, 03/16/2015 ^(b)		7,000				6,995
Thunder Bay Funding LLC							0.22%, 03/23/2015 ^(b)		6,800				6,794
0.12%, 11/25/2014 ^(b)			5,600		5,600
Toyota Credit Canada Inc (credit support											$		21,207
from Toyota Financial Services)						TOTAL COMMERCIAL PAPER					$		739,988
0.17%, 11/19/2014 ^(d)			7,900		7,899				Principal
0.17%, 11/20/2014 ^(d)			7,400		7,399	CERTIFICATE OF DEPOSIT - 3.29%		Amount (000's)			Value(000			's)
			$		281,895	Banks - 3.29%
Electric - 3.69%						Bank of America NA
GDF Suez							0.18%, 12/16/2014		6,700				6,700
0.14%, 12/03/2014 ^(b)			6,400		6,399		0.20%, 12/11/2014		9,000				9,000
0.14%, 12/16/2014 ^(b)			6,500		6,499		0.20%, 12/12/2014		7,000				7,000
0.15%, 12/19/2014 ^(b)			6,100		6,099	Bank of Nova Scotia/Houston
							0.39%, 11/11/2015 ^(a),(e)		5,800				5,800
0.21%, 11/18/2014 ^(b)			7,900		7,899
Oglethorpe Power Corp						Citibank NA
0.17%, 12/15/2014 ^(b)			6,986		6,984		0.19%, 02/23/2015		7,000				7,000
0.17%, 01/12/2015 ^(b)			6,000		5,998						$		35,500
			$		39,878	TOTAL CERTIFICATE OF DEPOSIT					$		35,500
									Maturity
Electrical Components & Equipment - 0.64%						REPURCHASE AGREEMENTS - 4.47%		Amount (000's)		Value	(000			's)
Emerson Electric Co
0.09%, 12/26/2014 ^(b)			6,900		6,899	Banks - 4.47%
						Merrill Lynch Repurchase Agreement; 0.08%		$	48,240		$		48,240
							dated 10/31/2014 maturing 11/03/2014
Food- 0.69	%						(collateralized by US Government
Unilever Capital Corp (credit support from							Securities; $49,204,800; 0.00% - 2.25%;
Unilever PLC)							dated 03/31/16 - 08/15/21)
0.05%, 11/06/2014 ^(b),(d)			7,500		7,500
						TOTAL REPURCHASE AGREEMENTS					$		48,240
Insurance - 2.78%						Total Investments					$		1,083,038
Prudential Funding LLC (credit support from						Liabilities in Excess of Other Assets, Net - (0.31)%					$		(3,315	)
Prudential Financial Inc)						TOTAL NET ASSETS - 100.00%					$		1,079,723
0.06%, 11/07/2014 ^(d)			7,000		7,000
Prudential PLC
0.15%, 12/15/2014 ^(b)			8,000		7,998	(a)	Variable Rate. Rate shown is in effect at October 31, 2014.
0.15%, 01/07/2015 ^(b)			7,000		6,998	(b)	Security exempt from registration under Rule 144A of the Securities Act of
0.18%, 02/17/2015 ^(b)			5,000		4,997		1933. These securities may be resold in transactions exempt from
0.21%, 01/15/2015 ^(b)			3,000		2,999		registration, normally to qualified institutional buyers. Unless otherwise
			$		29,992		indicated, these securities are not considered illiquid. At the end of the
							period, the value of these securities totaled $548,223 or 50.77% of net
Miscellaneous Manufacturing - 2.12%							assets.
Dover Corp						(c)	Security is Illiquid
0.08%, 11/03/2014 ^(b)			16,000		16,000	(d)	Credit support indicates investments that benefit from credit enhancement
0.09%, 11/03/2014 ^(b)			6,900		6,900		or liquidity support provided by a third party bank, institution, or
							government agency.
Oil & Gas - 0.63%						(e)	Security issued by foreign bank and denominated in USD.
BP Capital Markets PLC (credit support from
BP PLC)
0.10%, 11/07/2014 ^(b),(d)			6,800		6,800


Pipelines - 0.21%
Questar Corp
0.14%, 11/12/2014 ^(b)			2,300		2,300

We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Money Market Fund, (1 of the portfolios constituting Principal Funds, Inc., (the “Fund”)), as of October 31, 2014, and the related statement of operations for the year then ended, statement of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Fund’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of October 31, 2014 by correspondence with the custodian and transfer agents. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Money Market Fund of Principal Funds, Inc., at October 31, 2014, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and its financial highlights for each of the five years in the period then ended, in conformity with U.S. generally accepted accounting principles.

As a shareholder of the Money Market Fund of Principal Funds, Inc., you incur two types of costs: (1) transaction costs (for Class J shares only), including contingent deferred sales charges; and (2) ongoing costs, including management fees; distribution fees; and other fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in Principal Funds, Inc. and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (May 1, 2014 to October 31, 2014), unless otherwise noted.

The first section of the table below provides information about actual account values and actual expenses. You may use the information in this section, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. An annual fee of $15.00 or $30.00 may apply to IRA and 403(b) accounts, respectively. These fees are not included in the table below. If they were, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount.

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

^#Expenses are equal to a fund's annualized expense ratio multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).

The following directors are considered not to be “interested persons” as defined in the 1940 Act


		Number of	Other
Name,		Portfolios in Fund	Directorships
Position Held with the Fund,	Principal Occupation(s)	Complex Overseen by	Held by Director
Year of Birth	During past 5 years	Director	During Past 5 Years
Elizabeth Ballantine	Principal, EBA Associates	117	Durango Herald, Inc;
Director since 2004			McClatchy
Member, Nominating and Governance			Newspapers, Inc.
Committee
1948

Leroy T. Barnes, Jr.	Retired.	117	McClatchy
Director since March 2012			Newspapers, Inc.;
Member, Audit Committee			Herbalife Ltd.; Frontier
1951			Communications, Inc.;
			Longs Drug Stores

Craig Damos	President, The Damos	117	Hardin Construction
Director since 2008	Company. Formerly, CEO, The		Company
Member, Audit Committee	Weitz Company
Member, 15(c) Committee
1954

Mark A. Grimmett	Executive Vice President and	117	None
Director since 2004	CFO, Merle Norman Cosmetics,
Member, Nominating and Governance	Inc.
Committee
Member, 15(c) Committee
Member, Executive Committee
1960

Fritz S. Hirsch	CEO, MAM USA	117	Focus Products Group
Director since 2005	Formerly, President, Sassy, Inc.
Member, Operations Committee
Member, 15(c) Committee
1951

Tao Huang	Formerly, Chief Operating	117	Armstrong World
Director since March 2012	Officer, Morningstar, Inc.		Industries, Inc.
Member, Operations Committee
Member, 15(c) Committee
1962

William C. Kimball	Partner, Kimball – Porter	117	Casey’s General Stores,
Director since 1999	Investments L.L.C.		Inc.
Member, Nominating and Governance
Committee
1947

Karen (“Karrie”) McMillan	Formerly, General Counsel,	117	None
Director since September 2014	Investment Company Institute
Member, Operations Committee
1961

Daniel Pavelich	Retired.	117	None
Director since 2007
Member, Audit Committee
Member, 15(c) Committee
1944

The following directors are considered to be “interested persons” as defined in the 1940 Act, as amended, because of an affiliation with the Manager and Principal Life.


		Number of
		Portfolios in Fund	Other
Name,		Complex	Directorships
Position Held with the Fund,	Principal Occupation(s)	Overseen by	Held by Director
Year of Birth	During past 5 years	Director	During Past 5 Years
Michael J. Beer	Executive Vice President, Principal	117	None
Director since 2012	Funds Distributor, Inc. (“PFD”)
Executive Vice President	Vice President/Mutual Funds and
Member, Executive Committee	Broker Dealer, Principal Life
1961	Insurance Company (“PLIC”)
	Director, Principal Management
	Corporation, (the “Manager”)
	Executive Vice President/ Chief
	Operating Officer, the Manager
	Director, Princor
	President, Princor
	Director, Principal Shareholder
	Services (“PSS”) since 2011
	President, PSS since 2011

Nora M. Everett	Director, Edge (2008-2011)	117	None
Director since 2008	Director, Finisterre since 2011
President, CEO, and Chairman	Chairman, Principal Financial
Member, Executive Committee	Advisors, Inc. (“PFA”) since 2010
1959	Chairman, PFD since 2011
	Senior Vice President/Retirement and
	Investor Services, PLIC
	Chairman, the Manager since 2011
	President, the Manager since 2008
	Chairman, Princor since 2011
	Chief Executive Officer, Princor since
	2009
	Chairman, PSS since 2011

Correspondence intended for each Director who is other than an Interested Director may be sent to 711 High Street, Des Moines, IA

Name, Position Held with the Fund, Address, and Year of Birth

Randy L. Bergstrom Assistant Tax Counsel

711 High Street, Des Moines, IA 50392 1955

David J. Brown

Chief Compliance Officer

711 High Street, Des Moines, IA 50392 1960

Principal Occupation(s) During past 5 years

Counsel, Principal Global Investors, LLC (“PGI”) Counsel, PLIC

Senior Vice President, PFD

Vice President/Compliance, PLIC

Senior Vice President, the Manager Senior Vice President, Princor Senior Vice President, PSS

Teresa M. Button Treasurer

711 High Street, Des Moines, IA 50392 1963

Vice President/Treasurer, Edge since 2011 Vice President/Treasurer, PFA since 2011

Ernie H. Gillum

Vice President, Assistant Secretary 711 High Street, Des Moines, IA 50392 1955

Carolyn F. Kolks Assistant Tax Counsel

711 High Street, Des Moines, IA 50392 1962

Jennifer A. Mills Assistant Counsel

711 High Street, Des Moines, IA 50392 1973

Vice President/Chief Compliance Officer, the Manager

Vice President/Chief Compliance Officer, PSS

Counsel, PGI Counsel, PLIC

Counsel, PFD (2009-2013) Counsel, PLIC

Counsel, the Manager (2009-2013) Counsel, Princor (2009-2013) Counsel, PSS (2009-2013)

Layne A. Rasmussen

Vice President, Controller, and CFO 711 High Street, Des Moines, IA 50392 1958

Michael D. Roughton Counsel

711 High Street, Des Moines, IA 50392 1951

Vice President/Controller – Principal Funds, the Manager

Senior Vice President/Counsel, PFA Senior Vice President/Counsel, PFD

Vice President & Associate General Counsel, PLIC Senior Vice President/Counsel, the Manager Senior Vice President/Counsel, Princor (2009-2013) Senior Vice President/Counsel, PSS

Britney L. Schnathorst

Assistant Counsel 1981

Counsel, PLIC since 2013

Prior thereto, Attorney in Private Practice

Name, Position Held with the Fund, Address, and Year of Birth

Adam U. Shaikh Assistant Counsel

711 High Street, Des Moines, IA 50392 1972

Principal Occupation(s) During past 5 years

Counsel, PFD (2006-2013) Counsel, PLIC

Counsel, the Manager (2007-2013) Counsel, Princor (2007-2013) Counsel, PSS (2007-2013)

Dan Westholm Assistant Treasurer

711 High Street, Des Moines, IA 50392 1966

Assistant Vice President/Treasury, PFA since 2013 Director – Treasury, PFA (2011-2013)

Assistant Vice President/Treasury, PFD since 2013 Director – Treasury, PFD (2011-2013) Assistant Vice President/Treasury, PLIC

Assistant Vice President/Treasury, the Manager Assistant Vice President/Treasury, Princor since 2013 Director – Treasury, Princor (2008-2009, 2011-2013) Assistant Vice President/Treasury, PSS

Beth Wilson

Vice President and Secretary

711 High Street, Des Moines, IA 50392 1956

Vice President, the Manager (2007-2013)

Vice President, Princor (2007-2009)

The 15(c) Committee assists the Board in performing the annual review of the Fund’s advisory and sub-advisory agreements pursuant to Section 15(c) of the 1940 Act.

Annual Review and Renewal of Management Agreement and Subadvisory Agreements

At its September 9, 2014 meeting, the Board performed its annual review and renewal process relating to the Management Agreement and the Subadvisory Agreements for all Funds.

GLOBAL INVESTMENT MANAGEMENT • ASSET ALLOCATION EXPERTISE • RETIREMENT LEADERSHIP

A mutual fund’s share price and investment return will vary with market conditions, and the principal value of an investment when you sell your shares may be more or less than the original cost.

To obtain an additional prospectus, please contact your financial professional or call 800-222-5852.

Note: if your shares are not held directly with Principal Funds
but through a brokerage firm, please contact your broker for
electronic delivery options available.

(a) The Registrant has adopted a code of ethics (the "Code of Ethics") that applies to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions.

presented in Item 1 hereto. The amendment was made to list the current Principal Executive Officer.

(d) The Registrant has not granted a waiver or an implicit waiver from a provision of its Code of Ethics during the period covered by the shareholder report presented in Item 1 hereto.

The Registrant's Board has determined that Daniel Pavelich, a member of the Registrant's Audit Committee, is an "audit committee financial expert" and "independent," as such terms are defined in this Item.

(a) Audit Fees. Ernst & Young is the principal accountant for the registrant. As such, Ernst & Young has audited the financial statements of the registrant and reviewed regulatory filings that include those financial statements. During the last two fiscal years, Ernst & Young has billed the following amounts for their professional services.

(b) Audit-Related Fees. Ernst & Young provided audit-related services to the registrant that are not included in response to item 4(a). Those services related to the review of Form N-1A and Form N-14. During the last two fiscal years, Ernst & Young has billed the following amounts for those services.

Ernst and Young billed no fees that registrant’s audit committee was required to pre-approve pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X.

(c) Tax Fees. Ernst & Young reviews the federal income tax returns and federal excise tax returns of the registrant. In connection with this review, Ernst & Young reviews the calculation of the registrant’s dividend distributions that are included as deductions on the tax returns. Ernst & Young also provides services to identify passive foreign investment companies. Ernst & Young also prepares and reviews Canadian income tax returns. Ernst & Young also provides services to understand and comply with tax laws in certain foreign countries. During the last two fiscal years, Ernst & Young has billed the following amounts for their professional tax services.

Ernst and Young billed no fees that registrant’s audit committee was required to pre-approve pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X.

(d) All Other Fees. Ernst & Young has not billed the registrant for other products or services during the last two fiscal years.

Ernst and Young billed no fees that registrant’s audit committee was required to pre-approve pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X.

(e) (1) Audit Committee Pre-Approval Policy. The audit committee of the registrant has adopted the following pre-approval policy:

The purpose of this policy is to ensure the independence of the Principal Funds' primary independent auditor. This policy is established by the Audit Committee (the "Committee") of the Board of Directors of Principal Funds, Inc. and Principal Variable Contracts Funds, Inc. (the "Funds") effective for all engagements of the primary independent auditor.

1. The primary independent auditor, its subsidiaries and affiliates shall not provide Prohibited Services to the Funds. For the purposes of this policy, Prohibited Services are:

• Services that are subject to audit procedure during a financial statement audit;

• Services where the auditor is an advocate to the client's position in an adversarial proceeding;

• Bookkeeping or other services related to the accounting records or financial statements of the Funds, its subsidiaries and affiliates;

• Appraisal or valuation services, fairness opinions, or contribution-in-kind reports;

• Tax planning services related to listed, confidential and aggressive transactions;

• Personal tax planning services to individuals in a financial reporting oversight role with regard to the Funds (other than members of the Board of Directors who are not also officers of the Funds), including the immediate family members of such individuals;

• Any other service that the Public Company Accounting Oversight Board (PCAOB) determines, by regulation, is impermissible.

2. (A) All services the primary independent auditor, its subsidiaries and affiliates provide to the Funds, and (B) Audit services, including audits of annual financial statements, audits of acquired or divested businesses or review of regulatory filings, any independent auditor provides, shall be approved by the Committee in advance in accordance with the following procedure:

Each quarter, Management will present to the Committee for pre-approval, a detailed description of each particular service, excluding tax services, for which pre-approval is sought and a range of fees for such service. The Committee may delegate pre-approval authority to one or more of its members provided such delegated member(s) shall present a report of any services approved to the full Committee at its next regularly scheduled meeting. The Committee Chairperson shall have pre-approval authority for changes to any range of fees applicable to services the Committee

previously approved and for new services and the range of fees for such services that arise between regularly scheduled Committee meetings.

Similarly, the primary independent auditor will present to the Committee for pre-approval a written description of the nature and scope of all tax services not expressly prohibited, including the fee arrangements for such services, and the potential effects of such services on the audit firm’s independence.

In considering whether to pre-approve the primary independent auditor’s provision of non-audit services, the Committee will consider whether the services are compatible with the maintenance of such auditor's independence. The Committee will also consider whether the primary independent auditor is best positioned to provide the most effective and efficient service, for reasons such as its familiarity with the Funds' business, people, culture, accounting systems, risk profile and other factors, and whether the service might enhance the Funds' ability to manage or control risk or improve audit quality.

3. The provisions of this policy shall apply to all audit and non-audit services provided directly to the Funds. Additionally, the provisions of this policy shall apply to non-audit services provided to Principal Management Corporation or an affiliate of Principal Management Corporation that provides ongoing services to the Funds if the engagement relates directly to the operations and financial reporting of the Funds.

4. Not less than annually, the primary independent auditor shall report to the Committee in writing all relationships that may reasonably be thought to bear on independence between the auditor and the Funds or persons in financial reporting oversight roles with respect to any services provided by the auditor, its subsidiaries or affiliates as of the date of the communication, pursuant to Rule 3526 of the PCAOB. The primary independent auditor shall discuss with the Committee the potential effects of such relationships on the independence of the auditor. In addition, the primary independent auditor shall affirm, in writing, that, as of the date of the communication, it is independent within the meaning of the federal securities laws and Rule 3520 of the PCAOB.

5. The Committee shall ensure that the lead and concurring partners of the Funds' primary independent auditor are rotated at least every five years and subject upon rotation to a five year "time out" period. All other partners of the primary independent auditor, excluding partners who simply consult with others on the audit engagement regarding technical issues, shall rotate after seven years and be subject upon rotation to a two year "time out" period.

6. Neither the Funds or Principal Management Corporation may hire or promote any former partner, principal, shareholder or professional employee (Former Employee) of the primary independent auditor into a financial reporting oversight role unless the Former Employee (1) has severed his/her economic interest in the independent audit firm, and (2) was not a member of the audit engagement team for the Funds during the one year period preceding the date that the audit procedures began for the fiscal period in which the Funds or Principal Management Corporation proposes to hire or promote the Former Employee. Neither the Funds nor Principal Management Corporation shall, without prior written consent of the primary independent auditor, hire or promote any Former Employee into a role not prohibited above if the Former Employee had provided any services to the Funds or Principal Management Corporation during the 12 months preceding the date of filing of the Funds' most recent annual report with the SEC. Upon termination of the primary independent auditor, the Funds or Principal Management Corporation shall not, without prior written consent of the former primary independent auditor, hire or promote any Former Employee for a period of up to 12 months from termination.

(Adopted by the Audit Committee of the Board of Directors of the Principal Funds on March 12, 2013).

(e) (2) Pre-Approval Waivers. There were no services provided to the registrant by Ernst & Young that were approved pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

(f) Substantially all work in connection with the audit of the registrant’s financial statements was performed by full-time employees of Ernst & Young.

(g) The aggregate non-audit fees Ernst and Young billed to the registrant, the registrant's investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by or under common control with the adviser that provides ongoing services to the registrant for each of registrant's last two fiscal years were as follows.

(h) The registrant’s audit committee of the board of directors has considered whether the provision of non-audit services that were rendered to the registrant’s investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence.

Schedule of Investments is included as part of the Report to Shareholders filed under Item 1 of this form.

ITEM 7 – DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES

ITEM 9 – PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS

There have been no material changes to the procedures by which shareholders may recommend nominees to registrant’s board of directors.

a) The registrant's principal executive officer and principal financial officer have concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended) are effective (such disclosure controls and procedures having been evaluated within 90 days of the date of this filing).

(b) There have been no changes in the registrant’s internal controls over financial reporting (as defined in Rule 30a-3(d) under the Act (17 CFR 270.30a-3(d)) that occurred during the registrant’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.

(a)(1) Code of Ethics required to be disclosed under Item 2 of Form N-CSR attached hereto as Exhibit 99.CODE ETH.

(a)(2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and Rule 30a-2(a) under the Investment Company Act are attached hereto as Exhibit 99.CERT.

(b) Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and Rule 30a-2(b) under the Investment Company Act is attached hereto as Exhibit 99.906CERT.

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.

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.


Average Annual Total Returns* as of October 31, 2014
								Inception	Extended
		1-Year		5-Year		10-Year			Performance
								Date	Inception Date
Class A Shares	Excluding Sales Charge	4.02	%	5.54	%	3.81	%	6/28/05	12/6/00
	Including Sales Charge	0.13	%	4.73	%	3.42	%
Class B Shares	Excluding Sales Charge	3.17	%	4.84	%	3.24	%	6/28/05	12/6/00
	Including Sales Charge	-1.83	%	4.51	%	3.24	%
Class C Shares	Excluding Sales Charge	3.12	%	4.68	%	2.97	%	1/16/07	12/6/00
	Including Sales Charge	2.12	%	4.68	%	2.97	%


Total Investment Expense as shown in the 3/1/14 prospectus
	Gross Expense Ratio		Net Expense Ratio
Class A Shares	1.02	%	0.88	%
Class B Shares	2.90	%	1.60	%
Class C Shares	2.03	%	1.75	%

Average annual total returns* including sales charge as of 9/30/14:
Class A Shares: 0.33% (1-year); 4.88% (5-year); 3.40% (10-year)
Class B Shares: -1.39% (1-year); 4.65% (5-year); 3.22% (10-year)
Class C Shares: 2.37% (1-year); 4.82% (5-year); 2.95% (10-year)


Total Investment Expense as shown in the 3/1/14 prospectus
Gross Expense Ratio			Net Expense Ratio
Class A Shares	0.81	%	0.81	%
Class B Shares	3.81	%	1.86	%
Class C Shares	1.84	%	1.84	%

Average annual total returns* including sales charge as of 9/30/14:
Class A Shares: 8.29% (1-year); 4.96% (5-year); 3.59% (10-year)
Class B Shares: 6.38% (1-year); 4.39% (5-year); 3.29% (10-year)
Class C Shares: 10.36% (1-year); 4.77% (5-year); 3.07% (10-year)


Average Annual Total Returns* as of October 31, 2014
								Inception	Extended
		1-Year		5-Year		10-Year			Performance
								Date	Inception Date
Class A Shares	Excluding Sales Charge	2.94	%	7.94	%	6.54	%	6/28/05	12/6/00
	Including Sales Charge	-2.75	%	6.74	%	5.94	%
Class B Shares	Excluding Sales Charge	1.84	%	6.77	%	5.71	%	6/28/05	12/6/00
	Including Sales Charge	-3.16	%	6.46	%	5.71	%
Class C Shares	Excluding Sales Charge	2.10	%	7.24	%	5.85	%	1/16/07	12/6/00
	Including Sales Charge	1.10	%	7.24	%	5.85	%
Class P Shares	Excluding Sales Charge	3.25	%	8.25	%	6.68	%	9/27/10	12/6/00


Total Investment Expense as shown in the 3/1/14 prospectus
	Gross Expense Ratio		Net Expense Ratio
Class A Shares	1.40	%	1.40	%
Class B Shares	2.95	%	2.47	%
Class C Shares	2.35	%	2.08	%
Class P Shares	2.29	%	1.04	%

Average annual total returns* including sales charge as of 9/30/14:
Class A Shares: 1.22% (1-year); 6.20% (5-year); 6.24% (10-year)
Class B Shares: 0.98% (1-year); 5.95% (5-year); 6.01% (10-year)
Class C Shares: 5.36% (1-year); 6.73% (5-year); 6.16% (10-year)
Class P Shares: 7.47% (1-year); 7.74% (5-year); 6.99% (10-year)


Letter from the President	1
Economic & Financial Market Review	3
Bond & Mortgage Securities Fund	4
California Municipal Fund	6
Diversified International Fund	8
Equity Income Fund	10
Global Diversified Income Fund	12
Global Real Estate Securities Fund	14
Government & High Quality Bond Fund	16
High Yield Fund	18
High Yield Fund I	20
Income Fund	22
Inflation Protection Fund	24
International Emerging Markets Fund	26
International Fund I	28
LargeCap Growth Fund	30
LargeCap Growth Fund I	32
LargeCap S&P 500 Index Fund	34
LargeCap Value Fund	36
MidCap Fund	38
MidCap Value Fund III	40
Principal Capital Appreciation Fund	42
Real Estate Securities Fund	44
Short-Term Income Fund	46
SmallCap Blend Fund	48
SmallCap Value Fund II	50
Tax-Exempt Bond Fund	52
Financial Statements	54
Notes to Financial Statements	98
Schedules of Investments	131
Financial Highlights (Includes performance information)	282
Report of Independent Registered Public Accounting Firm	314
Shareholder Expense Example	315
Supplemental Information	318

**	Net asset value is not adjusted for sales charge.
***	Performance shown for the benchmark assumes reinvestment of all dividends and distributions. Indices are unmanaged, and individuals cannot


Total Investment Expense as shown in the 3/1/14 prospectus
	Gross/Net Expense Ratio
Class A Shares	0.93	%
Class B Shares	1.82	%
Class C Shares	1.66	%
Class P Shares	0.63	%

Average annual total returns* including sales charge as of 9/30/14:
Class A Shares: 10.33% (1-year); 13.30% (5-year); 7.47% (10-year)
Class B Shares: 10.83% (1-year); 13.35% (5-year); 7.31% (10-year)
Class C Shares: 14.87% (1-year); 13.75% (5-year); 7.27% (10-year)
Class P Shares: 17.09% (1-year); 14.84% (5-year); 8.20% (10-year)

**	Net asset value is not adjusted for sales charge.
***	Performance shown for the benchmark is calculated from 9/30/07 and assumes reinvestment of all dividends and distributions. Indices are


	Portfolio Managers:

Dimensional Fund Advisors, LP Principal Management Corp.	Los Angeles Capital Management & Equity Research, Inc. Vaughan Nelson Investment Management, LP

^(a)	Class A and Class P shares commenced operations on June 3, 2014.
^(b)	Class P shares commenced operations on June 3, 2014

^(a)	Period from March 1, 2013, date operations commenced, through October 31, 2013 for Class A.
^(b)	Period from June 3, 2014, date operations commenced, through October 31, 2014 for Class P.


Diversified			Global			Global Real Estate			International
International Fund			Diversified Income Fund			Securities Fund			Emerging Markets Fund
Euro	16.6	%	Euro	5.9	%	Japanese Yen	12.8	%	Hong Kong Dollar	19.2	%
Japanese Yen	16.5					Hong Kong Dollar	7.1		South Korean Won	15.7
British Pound Sterling	14.2					British Pound Sterling	7.0		New Taiwan Dollar	12.9
Canadian Dollar	11.6					Australian Dollar	6.2		Brazilian Real	8.3
Swiss Franc	7.2					Euro	6.1		Indian Rupee	7.8
									South African Rand	7.2
									Mexican Peso	5.1

International Fund I
Japanese Yen	21.9	%
Hong Kong Dollar	14.6
British Pound Sterling	11.5
New Taiwan Dollar	6.8
Euro	6.6
Canadian Dollar	6.0


Fund: Bond & Mortgage Securities Fund
Financial Derivative Instruments: Over the Counter Summary

		Counterparty
		Barclays Bank PLC
Assets*
Credit Default Swap	$	2,201
Collateral (Received)/Pledged**		(2,201	)
Net Exposure	$	—



Fund: Global Diversified Income Fund
Financial Derivative Instruments: Over the Counter Summary

		Counterparty
		JP Morgan Chase			Total
Assets*
Foreign Currency Contracts	$	8,010		$	8,010
Total OTC	$	8,010		$	8,010

Liabilities*
Foreign Currency Contracts	$	(1,354	)	$	(1,354	)
Total OTC	$	(1,354	)	$	(1,354	)

Net Market Value of OTC Derivatives	$	6,656		$	6,656
Collateral (Received)/Pledged**		(290	)		(290	)
Net Exposure	$	6,366		$	6,366


Global Diversified Income Fund	Number of Contracts			Premium (thousands)
Beginning of period	129,517		$	19,446
Options written	1,525,260			180,695
Options expired	(214,916	)		(23,754	)
Options closed	(1,091,922	)		(139,974	)
Options exercised	(216,747	)		(22,166	)
Balance at end of period	131,192			14,247

Inflation Protection Fund				Notional Amount
	Number of Contracts			(thousands)			Premium (thousands)
Beginning of period	400			37,200		$	212
Options written	3,060			49,580			2,693
Options expired	(497	)		—			(72	)
Options closed	(786	)		(53,480	)		(1,804	)
Options exercised	—			—			—
Balance at end of period	2,177			33,300			1,029


		Unfunded Loan Commitment		Unrealized gain/(loss)
Bond & Mortgage Securities Fund	$	4,200	$	—
Global Diversified Income Fund		13,342		(1	)
High Yield Fund		51,900		—


	Total Percentage			Total Percentage
	of Outstanding			of Outstanding
Fund	Shares Owned		Fund	Shares Owned
Bond & Mortgage Securities Fund	84.53	%	Inflation Protection Fund	59.68	%
Diversified International Fund	54.63		International Emerging Markets Fund	61.05
Equity Income Fund	38.16		LargeCap Growth Fund	59.26
Global Diversified Income Fund	6.02		LargeCap Growth Fund I	38.94
Global Real Estate Securities Fund	55.69		LargeCap S&P 500 Index Fund	44.16
Government & High Quality Bond Fund	62.14		LargeCap Value Fund	85.77
High Yield Fund	7.99		MidCap Fund	6.21
High Yield Fund I	32.00		Principal Capital Appreciation Fund	42.67
Income Fund	63.92		Short-Term Income Fund	43.34


Core Plus Bond Fund I	$	6,606,200
Global Diversified Income Fund		16,450,966
SmallCap Value Fund II		9,635


Global Diversified Income Fund	$	20,695,325
High Yield Fund		700
High Yield Fund I		3,396,045
SmallCap Value Fund II		7,384


	Asset		Fair Value as of	Valuation
Fund	Type		October 31, 2014	Technique	Unobservable input		Input Values(s)


Government & High Quality Bond	Bonds	$	19,838	Indicative Market	Broker Quote	$	98.50 – 102.58
Fund				Quotations

Short-Term Income Fund	Bonds		33,574	Third Party	Broker Quote		99.94 – 100.54
				Vendor


							Accrued
							Discounts/
							Premiums																Net Change in Unrealized
		Value		Realized			and Change				Proceeds			Transfers				Transfers			Value		Appreciation/(Depreciation)
		October		Gain/			in Unrealized				from			into Level				Out of Level			October 31,		on Investments Held at
Fund		31, 2013		(Loss)			Gain/(Loss)		Purchases		Sales			3	*			3	**		2014		October 31, 2014

Government & High Quality Bond Fund
Bonds	$	19,893	$	(1	)	$	58	$	20,084	$	(302	)	$	—		$	(19,894		)	$	19,838	$	61
		Total $19,893	$	(1	)	$	58	$	20,084	$	(302	)	$	—		$	(19,894		)	$	19,838	$	61


Short-Term Income Fund
Bonds	$	—	$	—		$	77	$	33,497	$	—		$	—			$	—		$	33,574	$	77
		Total $ —	$	—		$	77	$	33,497	$	—		$	—			$	—		$	33,574	$	77

*	Expired February 28, 2014.
^	Period from June 3, 2014 to October 31, 2014. Expiration is February 29, 2016.


LargeCap Growth Fund I	.016	%
MidCap Value Fund III	.014
SmallCap Value Fund II	.024


	Shares		Dollars		Shares		Dollars
Bond & Mortgage Securities Fund	18	$	192	LargeCap Growth Fund	65	$	644
California Municipal Fund	1		11	LargeCap Value Fund	28		371
Diversified International Fund	49		588	MidCap Fund	76		1,474
Equity Income Fund	112		2,765	Money Market Fund	943		943
Government & High Quality Bond Fund	36		398	Principal Capital Appreciation Fund	52		2,381
High Yield Fund	70		553	Real Estate Securities Fund	23		434
Income Fund	37		357	SmallCap Blend Fund	24		478
International Emerging Markets Fund	10		236	Tax-Exempt Bond Fund	22		155

7. Investment Transactions


		Expired		Utilized
Bond & Mortgage Securities Fund	$	—	$	28,624
Diversified International Fund		—		202,637
Equity Income Fund		—		148,051
Global Diversified Income Fund		—		2,671
Global Real Estate Securities Fund		—		200
Government & High Quality Bond Fund		6,007		—
Income Fund		954		2,560
International Emerging Markets Fund		—		12,760
International Fund I		—		104,623
LargeCap S&P 500 Index Fund		—		99,903
Money Market Fund		—		219
Principal Capital Appreciation Fund		—		9,104
Short-Term Income Fund		—		6,616
SmallCap Blend Fund		—		5,909


	Schedule of Investments Principal Capital Appreciation Fund October 31, 2014




INVESTMENT COMPANIES - 2.33%	Shares Held	Value(000			's)

Publicly Traded Investment Fund - 2.33%
JP Morgan US Government Money Market	57,954,939		$	57,955
Fund

TOTAL INVESTMENT COMPANIES		$		57,955
Total Investments		$		2,494,699
Liabilities in Excess of Other Assets, Net - (0.10)%		$		(2,474	)
TOTAL NET ASSETS - 100.00%		$		2,492,225


(a) Non-Income Producing Security



Portfolio Summary (unaudited)
Sector				Percent
Consumer, Non-cyclical				17.93	%
Financial				17.11	%
Technology				15.47	%
Consumer, Cyclical				13.03	%
Industrial				11.79	%
Communications				8.11	%
Energy				7.73	%
Basic Materials				3.63	%
Utilities				2.97	%
Exchange Traded Funds				2.33	%
Liabilities in Excess of Other Assets, Net				(0.10	)%
TOTAL NET ASSETS				100.00	%

(a)	Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. Unless otherwise indicated, these securities are not considered illiquid. At the end of the period, the value of these securities totaled $599,152 or 23.61% of net assets.
(b)	Variable Rate. Rate shown is in effect at October 31, 2014.
(c)	Fair value of these investments is determined in good faith by the Manager under procedures established and periodically reviewed by the Board of Directors. At the end of the period, the fair value of these securities totaled $41,074 or 1.62% of net assets.
(d)	Non-Income Producing Security


		Glossary to the Schedule of Investments
		October 31, 2014


Currency Abbreviations
AUD	Australian Dollar
CAD	Canadian Dollar
CHF	Swiss Franc
CNY	Chinese Renminbi
COP	Colombian Peso
DKK	Danish Krone
EUR	Euro
GBP	British Pound Sterling
HKD	Hong Kong Dollar
IDR	Indonesian Rupiah
JPY	Japanese Yen
MXN	Mexican Peso
NZD	New Zealand Dollar
PLN	Polish Zloty
RUB	Russian Rouble
SEK	Swedish Krona
USD/$	United States Dollar

(a)	Calculated based on average shares outstanding during the period.
(b)	Total return is calculated without the front-end sales charge or contingent deferred sales charge, if applicable.
(c)	Reflects Manager's contractual expense limit.
(d)	Excludes interest expense and fees paid through inverse floater agreements. See "Operating Policies" in notes to financial statements.
(e)	Excludes expense reimbursement from Manager and/or custodian.
(f)	Excludes expense reimbursement from Manager.

(a)	Calculated based on average shares outstanding during the period.
(b)	Total return is calculated without the front-end sales charge or contingent deferred sales charge, if applicable.
(c)	Portfolio turnover rate excludes approximately $86,522,000 of sales from portfolio realignment from the acquisition of International Growth Fund.
(d)	Reflects Manager's contractual expense limit.
(e)	Period from September 27, 2010, date shares first offered, through October 31, 2010.
(f)	Total return amounts have not been annualized.
(g)	Computed on an annualized basis.

(a)	Calculated based on average shares outstanding during the period.
(b)	Total return is calculated without the front-end sales charge or contingent deferred sales charge, if applicable.
(c)	Period from June 3, 2014, date shares first offered, through October 31, 2014.
(d)	Total return amounts have not been annualized.
(e)	Total return is calculated using the traded net asset value which may differ from the reported net asset value.
(f)	Computed on an annualized basis.
(g)	Reflects Manager's contractual expense limit.
(h)	Period from September 27, 2010, date shares first offered, through October 31, 2010.
(i)	Period from March 1, 2013, date shares first offered, through October 31, 2013.


	Deductible
	Percentage
MidCap Value Fund III	58	%
Bond & Mortgage Securities Fund	1	%
LargeCap Growth Fund I	96	%
SmallCap Value Fund II	83	%
MidCap Blend Fund	100	%
LargeCap Value Fund	39	%
LargeCap Growth Fund	100	%
International Emerging Markets Fund	3	%
High Yield Fund I	1	%
SmallCap Blend Fund	97	%
Principal Capital Appreciation Fund	100	%
Diversified International Fund	1	%
Global Real Estate Securities Fund	4	%
Global Diversified Income Fund	10	%
Equity Income Fund	85	%
LargeCap S&P 500 Index Fund	100	%


		Foreign Taxes
		Per Share
Diversified International Fund	$	0.0303
International Emerging Markets Fund	$	0.0867
International Fund I	$	0.0469


	Institutional
Principal LifeTime 2010 Fund	63,768
Principal LifeTime 2020 Fund	246,364
Principal LifeTime 2030 Fund	252,388
Principal LifeTime 2040 Fund	159,959
Principal LifeTime 2050 Fund	89,568
Principal LifeTime Strategic Income Fund	40,604
SAM Balanced Portfolio	45,556
SAM Conservative Balanced Portfolio	22,400
SAM Conservative Growth Portfolio	26,966
SAM Flexible Income Portfolio	13,126
SAM Strategic Growth Portfolio	12,224


						Long-Term
		Ordinary Income				Capital Gain*
		2014		2013		2014		2013
Principal LifeTime 2010 Fund	$	31,301	$	39,103	$	—	$	—
Principal LifeTime 2020 Fund		118,013		124,847		65,974		—
Principal LifeTime 2030 Fund		116,319		112,077		82,514		—
Principal LifeTime 2040 Fund		70,619		66,204		96,482		—
Principal LifeTime 2050 Fund		34,006		28,890		53,246		—
Principal LifeTime Strategic Income Fund		16,102		19,423		—		—
SAM Balanced Portfolio		73,000		70,865		72,822		—
SAM Conservative Balanced Portfolio		30,692		28,780		28,155		6,496
SAM Conservative Growth Portfolio		37,744		37,712		26,302		—
SAM Flexible Income Portfolio		47,770		44,989		27,526		14,269
SAM Strategic Growth Portfolio		19,180		17,084		13,887		—