497 1 d580427d497.htm HC CAPITAL TRUST HC Capital Trust

Supplement to Prospectus

HC Advisors Shares

Dated November 1, 2012

HC Capital Trust

The date of this Supplement is August 5, 2013

On August 2, 2013, Mellon Capital Management Corporation was added as an additional Specialist Manager to each of the Value Equity, Institutional Value Equity, Growth Equity, Institutional Growth Equity, Small Capitalization Equity, Institutional Small Capitalization Equity, Real Estate Securities, Commodity Returns Strategy, International Equity, Institutional International Equity and Emerging Markets Portfolios pursuant to Portfolio Management Agreements approved by the shareholders of the respective Portfolios.

Additionally, on August 2, 2013, Ariel Investments, LLC was added as an additional Specialist Manager in the Small Capitalization Equity and Institutional Small Capitalization Equity Portfolios pursuant to Portfolio Management Agreements approved by the shareholders of the respective Portfolios.

The following material supplements the Prospectus dated November 1, 2012 to incorporate information about the new Specialist Managers.

The Value Equity Portfolio:

1. The following replaces the “Investment Subadvisers” section on page 5 of the Prospectus:

Investment Subadvisers

AllianceBernstein L.P. (“AllianceBernstein”), Institutional Capital, LLC (“ICAP”) Mellon Capital Management Corporation (“Mellon Capital”) and SSgA Funds Management, Inc. (“SSgA FM”) are the Specialist Managers for the Portfolio.

Portfolio Managers:

AllianceBernstein: Gerry Paul has managed the portion of the Portfolio allocated to AllianceBernstein since September, 2009, and Greg Powell has co-managed the portion of the Portfolio allocated to AllianceBernstein since July, 2010.

ICAP: Jerrold K. Senser and Thomas R. Wenzel have managed the portion of the Portfolio allocated to ICAP since August 25, 1995. Thomas C. Cole has managed the portion of the Portfolio allocated to ICAP since July, 2012.

Mellon Capital: Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed the portion of the Portfolio allocated to SSgA FM since July, 2012 and July, 2001, respectively.

2. The following replaces the “Specialist Managers.” section on page 83 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Institutional Capital, LLC (“ICAP”) and AllianceBernstein L.P. (“AllianceBernstein”) are currently responsible for implementing the active component of the Portfolio’s investment strategy. Additionally, a portion of the Portfolio is managed using “passive” or “index” investment approaches designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index. Mellon Capital and SSgA FM are currently responsible for implementing the passive component for the Portfolio’s investment strategy. The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

 

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3. The following is added to the Section “More Information About Fund Investments and Risks—The Value Equity Portfolio” on page 83 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the Russell 1000 Value(R) Index. The particular segments of the Russell 1000(R) Value Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The Russell 1000(R) Value Index is an unmanaged, market cap-weighted index, which is reviewed and reconstituted each year. Further information about the Russell 1000(R) Value Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the Russell 1000(R) Value Index.

The Institutional Value Equity Portfolio

1. The following replaces the “Investment Subadvisers” section on page 9 of the Prospectus:

Investment Subadvisers

AllianceBernstein L.P. (“AllianceBernstein”), Institutional Capital, LLC (“ICAP”), Pacific Investment Management Company LLC (“PIMCO”), Mellon Capital and SSgA FM are the Specialist Managers for the Portfolio.

Portfolio Managers:

AllianceBernstein: Gerry Paul has managed the portion of the Portfolio allocated to AllianceBernstein since September, 2009, and Greg Powell has co-managed the portion of the Portfolio allocated to AllianceBernstein since July, 2010.

ICAP: Jerrold K. Senser and Thomas R. Wenzel have co-managed the portion of the Portfolio allocated to ICAP since July, 2008. Thomas C. Cole has managed the portion of the Portfolio allocated to ICAP since July, 2012.

PIMCO: Saumil Parikh has managed a portion of the Portfolio allocated to PIMCO since April, 2009.

Mellon Capital. Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed the portion of the Portfolio allocated to SSgA FM since July, 2012 and July, 2008, respectively.

2. The following replaces the “Specialist Managers.” section on page 84 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Institutional Capital, LLC (“ICAP”), AllianceBernstein L.P. (“AllianceBernstein”) and Pacific Investment Management Company LLC (“PIMCO”) are currently responsible for implementing the active component of the Portfolio’s investment strategy. Additionally, a portion of the Portfolio is managed using “passive” or “index” investment approaches designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component for the Portfolio’s investment strategy. The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

 

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3. The following is added to the Section “More Information About Fund Investments and Risks—The Institutional Value Equity Portfolio” on page 84 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the Russell 1000(R) Value Index. The particular segments of the Russell 1000(R) Value Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The Russell 1000(R) Value Index is an unmanaged, market cap-weighted index, which is reviewed and reconstituted each year. Further information about the Russell 1000(R) Value Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the Russell 1000(R) Value Index.

The Growth Equity Portfolio:

1. The following replaces the “Investment Subadvisers” section on page 13 of the Prospectus:

Investment Subadvisers

Jennison Associates LLC (“Jennison”), Sustainable Growth Advisers LP (“SGA”), Mellon Capital and SSgA FM are the Specialist Managers for the Portfolio.

Portfolio Managers:

Jennison: Kathleen A. McCarragher has managed that portion of the Portfolio allocated to Jennison since January, 2005.

SGA: George P. Fraise, Gordon M. Marchand and Robert L. Rohn have co-managed that portion of the Portfolio allocated to SGA since June, 2006.

Mellon Capital. Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed the portion of the Portfolio allocated to SSgA FM since July, 2012 and July, 2001, respectively.

2. The following replaces the “Specialist Managers.” section on page 86 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Jennison and SGA are currently responsible for implementing the active component of the Portfolio’s investment strategy. The remaining portion of the Portfolio is managed using “passive” or “index” investment approaches that are designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index. Mellon Capital and SSgA FM are currently responsible for implementing the passive component of the Portfolio’s investment strategy. The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The Growth Equity Portfolio” on page 86 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a strict “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the Russell 1000(R) Growth

 

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Index. The particular segments of the Russell 1000(R) Growth Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The Russell 1000(R) Growth Index is an unmanaged, market cap-weighted index, which is reviewed and reconstituted each year. Further information about the Russell 1000(R) Growth Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the Russell 1000(R) Growth Index.

The Institutional Growth Equity Portfolio

1. The following replaces the “Investment Subadvisers” section on page 17 of the Prospectus:

Investment Subadvisers

Jennison Associates LLC (“Jennison”), PIMCO, Sustainable Growth Advisers LP (“SGA”), Mellon Capital and SSgA FM are the Specialist Managers for the Portfolio.

Portfolio Managers:

Jennison: Kathleen A. McCarragher has managed the portion of the Portfolio allocated to Jennison since August, 2008.

PIMCO: Saumil Parikh has managed the portion of the Portfolio allocated to PIMCO since August, 2008.

SGA: George P. Fraise, Gordon M. Marchand and Robert L. Rohn have co-managed that portion of the Portfolio allocated to SGA since August, 2008.

Mellon Capital. Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed the portion of the Portfolio allocated to SSgA FM since July 2012 and August, 2008 respectively.

2. The following replaces the “Specialist Managers.” section on page 87 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Jennison Associates LLC (“Jennison”), PIMCO and Sustainable Growth Advisers, LP (“SGA”) are currently responsible for implementing the active component of the Portfolio’s investment strategy. The remaining portion of the Portfolio is managed using “passive” or “index” investment approaches that are designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component of the Portfolio’s investment strategy. The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The Institutional Growth Equity Portfolio” on page 87 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of the one or more different segments of the Russell 1000(R) Growth Index. The particular segments of the Russell 1000(R) Growth Index that form the basis for Mellon Capital’s investments are

 

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determined by the Adviser in consultation with Mellon Capital. The Russell 1000(R) Growth Index is an unmanaged, market cap-weighted index, which is reviewed and reconstituted each year. Further information about the Russell 1000(R) Growth Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the Russell 1000(R) Growth Index.

The Small Capitalization Equity Portfolio:

1. The following replaces the “Investment Subadvisers” section on page 21 of the Prospectus:

Investment Subadvisers

Cupps Capital Management, LLC (“Cupps”), Frontier Capital Management Company, LLC (“Frontier”), IronBridge Capital Management LP (“IronBridge”), Pzena Investment Management, LLC (“Pzena”), SSgA FM, Mellon Capital and Ariel Investments, LLC (“Ariel”) are the Specialist Managers for the Portfolio.

Portfolio Managers:

Cupps: Andrew S. Cupps has managed the portfolio of the Portfolio allocated to Cupps since June, 2011.

Frontier: Michael Cavarretta has managed the portion of the Portfolio allocated to Frontier since September, 1995.

IronBridge: Christopher C. Faber and Jeffrey B. Madden have co-managed the portion of the Portfolio allocated to IronBridge since November, 2004, and Thomas W. Fanter has co-managed the portion of the Portfolio allocated to IronBridge since November 2011.

Pzena: Richard Pzena, Benjamin Silver and John Flynn have co-managed the portion of the Portfolio allocation to Pzena since April, 2010.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed the portion of the Portfolio allocated to SSgA FM since July, 2012 and July, 2009 respectively.

Mellon Capital. Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

Ariel. David M. Maley and Kenneth E. Kuhrt have co-managed the portion of the Portfolio allocated to Ariel since [August,] 2013.

2. The following replaces the “Specialist Managers.” section on page 88 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Cupps Capital Management, LLC (“Cupps”), Frontier Capital Management Company, LLC (“Frontier”), IronBridge Capital Management LP (“IronBridge”) Pzena Investment Management, LLC (“Pzena”), and Ariel Investments, LLC (“Ariel”), are currently responsible for implementing the active component of the Portfolio’s investment strategy. The remaining portion of the Portfolio is managed using “passive” or “index” investment approaches that are is designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component of the Portfolio’s investment strategy. Further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated among them appears in the “Specialist Manager Guide” included later in this Prospectus.

 

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3. The following is is added to the Section “More Information About Fund Investments and Risks—The Small Capitalization Equity Portfolio” on page 88:

The Ariel Investment Selection Process: Ariel uses independent thought and research to implement a four-part process. They screen more than 10,000 securities on size, valuation and industry parameters to yield roughly 2,000 issues. Of those they follow approximately 75 closely. They then determine whether or not an idea is cheap enough via a deep value strategy focusing on book value (often 1x or below), tangible book value, cash and other similar factors. There are no rigid criteria to their analytical process; they are trying to determine that a margin of safety exists between price and intrinsic value. They surround companies to paint a long-term picture and identify what others are missing. One key tool is their independent verification network of outside experts. Another tool is deciding the best methodology to determine whether a margin of safety exists. Once they have measured the gap between stock price and intrinsic value, they hold an informal discussion with any research members who are experts in the industry. The lead portfolio manager makes the final decision on whether or not to initiate a position. As natural contrarians, they sell a security when they believe that the valuation is no longer attractive due to assets and/or ability to generate profits and/or free cash flow. In keeping with their long-term patient approach, they will not sell a security because of a short-term disappointment. They will, however, sell a security if their investment thesis has changed, namely by a major shift in the competitive landscape, a deterioration in company fundamentals, and/or a loss of faith in management to execute the stated goals and objectives. The decision to sell is ultimately made by the lead portfolio manager.

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the Russell 2000(R) small capitalization universe (i.e. small capitalization value and small capitalization growth segments). The particular segments of the Russell 2000(R) universe that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The Russell 2000(R) Indices are unmanaged, market cap-weighted indices, which are reviewed and reconstituted each year. Further information about the Russell 2000(R) Indices appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the Russell 2000(R) Indices.

The Institutional Small Capitalization Equity Portfolio

1. The following replaces the “Investment Subadvisers” section on page 25 of the Prospectus:

Investment Subadvisers

Cupps Capital Management, LLC (“Cupps”), Frontier Capital Management Company, LLC (“Frontier”), IronBridge Capital Management LP (“IronBridge”), Pzena Investment Management, LLC (“Pzena”), SSgA FM, Mellon Capital and Ariel Investments, LLC (“Ariel”) are the Specialist Managers for the Portfolio.

Portfolio Managers:

Cupps: Andrew S. Cupps has managed the portion of the Portfolio allocated to Cupps since June, 2011.

Frontier: Michael Cavarretta has managed the portion of the Portfolio allocated to Frontier since the Portfolio’s August, 2008.

IronBridge: Christopher C. Faber and Jeffrey B. Madden have co-managed the portion of the Portfolio allocated to IronBridge since August, 2008, and Thomas W. Fanter has co-managed the portion of the Portfolio allocated to IronBridge since November 2011.

Pzena: Richard Pzena, Benjamin Silver and John Flynn have co-managed the portion of the Portfolio allocation to Pzena since April, 2010.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed the portion of the Portfolio allocated to SSgA FM since July, 2012 and July, 2009 respectively.

 

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Mellon Capital. Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

Ariel. David M. Maley and Kenneth E. Kuhrt have co-managed the portion of the Portfolio allocated to Ariel since [August,] 2013.

2. The following replaces the “Specialist Managers.” section on page 89 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Cupps Capital Management, LLC (“Cupps”), Frontier Capital Management Company, LLC (“Frontier”), IronBridge Capital Management LP (“IronBridge”), Pzena Investment Management, LLC (“Pzena”), and Ariel Investments, LLC (“Ariel”) are currently responsible for implementing the active component of the Portfolio’s investment strategy. The remaining portion of the Portfolio is managed using “passive” or “index” investment approaches that are designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component of the Portfolio’s investment strategy. Further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated among them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The Institutional Small Capitalization Equity Portfolio” on page 90:

The Ariel Investment Selection Process: Ariel uses independent thought and research to implement a four-part process. They screen more than 10,000 securities on size, valuation and industry parameters to yield roughly 2,000 issues. Of those they follow approximately 75 closely. They then determine whether or not an idea is cheap enough via a deep value strategy focusing on book value (often 1x or below), tangible book value, cash and other similar factors. There are no rigid criteria to their analytical process; they are trying to determine that a margin of safety exists between price and intrinsic value. They surround companies to paint a long-term picture and identify what others are missing. One key tool is their independent verification network of outside experts. Another tool is deciding the best methodology to determine whether a margin of safety exists. Once they have measured the gap between stock price and intrinsic value, they hold an informal discussion with any research members who are experts in the industry. The lead portfolio manager makes the final decision on whether or not to initiate a position. As natural contrarians, they sell a security when they believe that the valuation is no longer attractive due to assets and/or ability to generate profits and/or free cash flow. In keeping with their long-term patient approach, they will not sell a security because of a short-term disappointment. They will, however, sell a security if their investment thesis has changed, namely by a major shift in the competitive landscape, a deterioration in company fundamentals, and/or a loss of faith in management to execute the stated goals and objectives. The decision to sell is ultimately made by the lead portfolio manager.

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the Russell 2000(R) small capitalization universe (i.e. small capitalization value and small capitalization growth segments). The particular segments of the Russell 2000(R) universe that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The Russell 2000(R) Indices are unmanaged, market cap-weighted indices, which are reviewed and reconstituted each year. Further information about the Russell 2000(R) Indices appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the Russell 2000(R) Indices.

 

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The Real Estate Securities Portfolio

1. The following replaces the “Investment Subadvisers” section on page 30 of the Prospectus:

Investment Subadviser

Wellington Management Company, LLP (“Wellington Management”), SSgA FM and Mellon Capital are the Specialist Managers for the Portfolio.

Portfolio Manager:

Wellington Management: Bradford D. Stoesser has managed the Portfolio since September, 2010.

SSgA FM: John Tucker, CFA and Michael Feehily, CFA have not yet begun providing portfolio management services to the Portfolio.

Mellon Capital. Karen Wong, Warren Chiang, Peter Goslin and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

2. The following replaces the “Specialist Managers.” section on page 90 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Wellington Management Company, LLP (“Wellington Management”) is currently responsible for implementing the active component of the Portfolio’s investment strategy. The remaining portion of the Portfolio is managed using “passive” or “index” investment approaches that are designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component of the Portfolio’s investment strategy. Further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated among them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The Real Estate Securities Portfolio” on page 90 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the Dow Jones US Select REIT Index and FTSE EPRA/NAREIT. The particular segments of these indices that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The Dow Jones US Select REIT Index is designed to provide a measure of real estate securities that serve as proxies for direct real estate investing, in part by excluding securities whose value is not always closely tied to the value of the underlying real estate. The Index is a market capitalization weighted index of publicly traded REITs and is comprised of companies whose charters are the equity ownership and operation of commercial real estate and which operate under the REIT Act of 1960. The FTSE EPRA/NAREIT Global Real Estate Index Series is designed to represent general trends in eligible listed real estate stocks worldwide. Relevant real estate activities are defined as the ownership, trading and development of income-producing real estate. Further information about the Dow Jones US Select REIT Index and FTSE EPRA/NAREIT appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Fund’s returns may vary from the returns of the Dow Jones US Select REIT Index and FTSE EPRA/NAREIT.

The Commodity Returns Strategy Portfolio

1. The following replaces the “Investment Subadvisers” section on page 36 of the Prospectus:

 

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Investment Subadviser

Wellington Management, PIMCO, SSgA FM and Mellon Capital are the Specialist Managers for the Portfolio.

Portfolio Managers:

Wellington Management: Jay Bhutani has managed a portion of the Portfolio allocated to Wellington Management since June, 2010. David Chang and Gregory LeBlanc have managed a portion of the Portfolio allocated to Wellington Management since April 2011.

PIMCO: Nicholas Johnson has managed the portion of the Portfolio allocated to PIMCO since June, 2010.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have not yet begun providing portfolio management services to the Portfolio.

Mellon Capital. Karen Wong, Warren Chiang, Peter Goslin and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

2. The following replaces the “Specialist Managers.” section on page 93 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Wellington Management and PIMCO are currently responsible for implementing the active component of the Portfolio’s investment strategy. The remaining portion of the Portfolio is managed using “passive” or “index” investment approaches that are designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component of the Portfolio’s investment strategy. Further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated among them appears in the “Specialist Manager Guide” included later in this Prospectus

3. The following is added to the Section “More Information About Fund Investments and Risks—The Commodity Returns Strategy Portfolio” on page 93 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” “or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the MSCI ACWI Natural Resources Index. The particular segments of the MSCI ACWI Natural Resources Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The MSCI ACWI Natural Resources Index is comprised of large publicly traded companies, based on market capitalization, in global natural resources and commodities businesses that meet certain investability requirements. Further information about the MSCI ACWI Natural Resources Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the MSCI ACWI Natural Resources Index.

The International Equity Portfolio:

1. The following replaces the “Investment Subadvisers” section on page 40 of the Prospectus:

Investment Subadvisers

Artisan Partners Limited Partnership (“Artisan”), Capital Guardian Trust Company (“CapGuardian”), Causeway Capital Management LLC (“Causeway”), SSgA FM and Mellon Capital are the Specialist Managers for the Portfolio.

 

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Portfolio Managers:

Artisan: Mark L. Yockey has managed the portion of the Portfolio allocated to Artisan since July, 1999. Andrew J. Euretig and Charles Hamker have served as Associate Portfolio Managers to the portion of the Portfolio allocated to Artisan since February, 2012.

CapGuardian: Gerald Du Manoir and David I. Fisher have co-managed the portion of the Portfolio allocated to CapGuardian since August, 2006 and May, 2005, respectively. Nancy J. Kyle, Lionel M. Sauvage and Rudolf M. Staehelin have co-managed the portion of the Portfolio allocated to CapGuardian since May, 2000. Philip Winston has co-managed the portion of the Portfolio allocated to CapGuardian since November, 2010.

Causeway: Sarah H. Ketterer, Harry W. Hartford, James A. Doyle, Jonathan P. Eng and Kevin Durkin have co-managed that portion of the Portfolio allocated to Causeway since December, 2006 and Conor Muldoon has co-managed that portion of the Portfolio allocated to Causeway since September, 2010.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed that portion of the Portfolio allocated to SSgA FM since July, 2012.

Mellon Capital. Karen Wong, Warren Chiang, Peter Goslin and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

2. The following replaces the “Specialist Managers.” section on page 95 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Capital Guardian Trust Company (“CapGuardian”), Artisan Partners Limited Partnership (“Artisan”) and Causeway Capital Management LLC (“Causeway”) are currently responsible for implementing the active component of the Portfolio’s investment strategy. Additionally, a portion of the Portfolio may be managed using “passive” or “index” investment approaches designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component for the Portfolio’s investment strategy. The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The International Equity Portfolio” on page 95 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the MSCI EAFE Index. The particular segments of the MSCI EAFE Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The MSCI EAFE Index is a free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. and Canada. Further information about the MSCI EAFE Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the MSCI EAFE Index.

The Institutional International Equity Portfolio

1. The following replaces the “Investment Subadvisers” section on page 44 of the Prospectus:

 

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Investment Subadvisers

Artisan Partners Limited Partnership (“Artisan”), Capital Guardian Trust Company (“CapGuardian”), Causeway Capital Management LLC (“Causeway”), Lazard Asset Management LLC (“Lazard”), SSgA FM and Mellon Capital are the Specialist Managers for the Portfolio.

Portfolio Managers:

Artisan: Mark L. Yockey has managed the portion of the Portfolio allocated to Artisan since November, 2009. Andrew J. Euretig and Charles Hamker have managed the portion of the Portfolio allocated to Artisan since February, 2012.

CapGuardian: Gerald Du Manoir, David I. Fisher, Nancy J. Kyle, Lionel M. Sauvage and Rudolf M. Staehelin have co-managed the portion of the Portfolio allocated to CapGuardian since November, 2009 and Philip Winston has co-managed the portion of the Portfolio allocated to CapGuardian since November, 2010.

Causeway: Sarah H. Ketterer, Harry W. Hartford, James A. Doyle, Jonathan P. Eng and Kevin Durkin have co-managed that portion of the Portfolio allocated to Causeway since November, 2009 and Conor Muldoon has co-managed that portion of the Portfolio allocated to Causeway since September, 2010.

Lazard: Paul Moghtader, Taras Ivanenko, Alex Lai and Craig Scholl have co-managed the portion of the Portfolio allocated to Lazard since September, 2011.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed that portion of the Portfolio allocated to SSgA FM since July, 2012.

Mellon Capital. Karen Wong, Warren Chiang, Peter Goslin and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

2. The following replaces the “Specialist Managers.” section on page 96 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Capital Guardian Trust Company (“CapGuardian”), Artisan Partners Limited Partnership (“Artisan”) and Causeway Capital Management LLC (“Causeway”) and Lazard Asset Management LLC (“Lazard”) are currently responsible for implementing the active component of the Portfolio’s investment strategy. Additionally, a portion of the Portfolio may be managed using “passive” or “index” investment approaches designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component for the Portfolio’s investment strategy. The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The Institutional International Equity Portfolio” on page 97 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” “or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the MSCI EAFE Index. The particular segments of the MSCI EAFE Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The MSCI EAFE Index is a free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. and Canada. Further information about the MSCI EAFE Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the MSCI EAFE Index.

 

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The Emerging Markets Portfolio

1. The following replaces the “Investment Subadvisers” section on page 48 of the Prospectus:

Investment Subadvisers

The Boston Company Asset Management LLC (“TBCAM”), SSgA FM and Mellon Capital are the Specialist Managers for the Portfolio.

Portfolio Managers:

TBCAM: Kirk Henry, CFA and Warren Skillman have co-managed the active investment strategy portion of the Portfolio allocated to TBCAM since March, 2010.

SSgA FM: Christopher Laine, Michael Ho, Ph.D and Jean-Christophe de Beaulieu, CFA have managed the active investment strategy portion of the Portfolio allocated to SSgA FM since April, 2010, July, 2012, and July, 2012 respectively.

Michael Feehily, CFA and John Tucker, CFA have co-managed the passive investment strategy portion to the Portfolio allocated to SSgA FM since July, 2012.

Mellon Capital. Karen Wong, Warren Chiang, Peter Goslin and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

2. The following replaces the “Specialist Managers.” section on pages 99 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. The Boston Company Asset Management LLC (“TBCAM”) and SSgA FM are currently responsible for implementing the active component of the Portfolio’s investment strategy. Mellon Capital and SSgA FM also manage a portion of the Portfolio that may be managed using a “passive” or “index” investment approach designed to replicate the composition of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The Emerging Markets Portfolio” on page 99 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the MSCI EM Index. The particular segments of the MSCI EM Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The MSCI EM Index is an unmanaged free float-adjusted market capitalization index that is designed to measure equity market performance of emerging markets. Further information about the MSCI EM Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Fund’s returns may vary from the returns of the MSCI EM Index.

 

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The Small Capitalization Equity Portfolio and The Institutional Small Capitalization Equity Portfolio:

1. The following is inserted in the “Specialist Manager Guide” just after the “Alliance Bernstein L.P.” section on page 127:

Ariel Investments, LLC (“Ariel”) serves as a Specialist Manager for The Small Capitalization Equity Portfolio and The International Small Capitalization Equity Portfolio. Ariel is an investment adviser registered with the Securities and Exchange Commission pursuant to the Investment Advisers Act. Its headquarters are located at 200 East Randolph Street, Suite 2900, Chicago, IL 60601. As of March 31, 2013, Ariel had approximately $6 billion in assets under management.

For its services to The Small Capitalization Equity Portfolio and The Institutional Small Capitalization Equity Portfolio, Ariel will be paid an annual fee, calculated daily and payable quarterly, in arrears, based on the Combined Assets (i.e., the aggregate of the assets of the each Small Cap Portfolio allocated to Ariel and certain other investment advisory accounts at the Adviser or its affiliates for which Ariel provides similar services), in accordance with the following schedule: 1.00% of the first $10 million of the Combined Assets, 0.75% of the next $10 million and 0.50% of Combined Assets exceeding $20 million.

David M. Maley and Kenneth E. Kuhrt will be primarily responsible for the day-to-day management of that portion of the Small Cap Portfolios’ assets allocated to Ariel. Mr. Maley is the firm’s Lead Portfolio Manager for its micro and small cap deep value strategies. He has been with Ariel since 2009 and has previously served as a Vice President at Goldman Sachs, Vice President and Senior Portfolio Manager at Harris Bank and President at Maple Hill Capital Management. Mr. Kuhrt, a Portfolio Manager, is a Certified Public Accountant and has been with the firm since 2004. Prior to joining Ariel, Mr. Kuhrt was a Senior Investment Banking Analyst at William Blair & Co, LLC and a Senior Auditor at KPMG, LLP.

The Value Equity Portfolio, The Institutional Value Equity Portfolio, The Growth Equity Portfolio, The Institutional Growth Equity Portfolio, The Small Capitalization Equity Portfolio, The Institutional Small Capitalization Equity Portfolio, The Real Estate Securities Portfolio, The Commodity Returns Strategy Portfolio, The International Equity Portfolio, The Institutional International Equity Portfolio and The Emerging Markets Portfolio:

1. The following replaces the “Mellon Capital Management Corporation” section of the “Specialist Manager Guide” on page 134:

Mellon Capital Management Corporation (“Mellon Capital”) serves as a Specialist Manager for The Value Equity Portfolio, The Institutional Value Equity Portfolio, The Growth Equity Portfolio, The Institutional Growth Equity Portfolio, The Small Capitalization Equity Portfolio, The Institutional Small Capitalization Equity Portfolio, The Real Estate Securities Portfolio, The Commodity Returns Strategy Portfolio, The International Equity Portfolio, The Institutional International Equity Portfolio and The Emerging Markets Portfolio. Mellon Capital, which was organized as a Delaware corporation in 1983, is headquartered at 50 Fremont Street, Suite 3900, San Francisco, CA 94105. Mellon Capital is a wholly-owned indirect subsidiary of The Bank of New York Mellon Corporation (“BNY Mellon”).

For its services to The Value Equity Portfolio, The Institutional Value Equity Portfolio, The Growth Equity Portfolio, The Institutional Growth Equity Portfolio, The Small Capitalization Equity Portfolio, The Institutional Small Capitalization Equity Portfolio, The Real Estate Securities Portfolio, The Commodity Returns Strategy Portfolio, The International Equity Portfolio, The Institutional International Equity Portfolio and The Emerging Markets Portfolio (the “Equity Portfolios”), Mellon Capital receives fees for each of the Equity Portfolios, calculated based on an annual percentage of average daily net assets. Mellon Capital’s fees would be paid at one level so long as the aggregate assets allocated to Mellon Capital for all of its passive equity mandates (including accounts for other clients of the Adviser and its affiliates besides the Trust) exceed $2 billion. Should these aggregate assets fall below $2 billion, a higher fee will apply. The initial allocation to Mellon Capital is expected to exceed $4.5 billion.

 

     Fee When Aggregate
Assets Are Greater
Than $2 Billion
    Fee When Aggregate
Assets Are Less
Than $2 Billion
 

The Value Equity Portfolio:

     0.065     0.075

The Institutional Value Equity Portfolio:

     0.065     0.075

The Growth Equity Portfolio:

     0.065     0.075

 

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The Institutional Growth Equity Portfolio:

     0.065     0.075

The Small Capitalization Equity Portfolio:

     0.065     0.075

The Institutional Small Capitalization Equity Portfolio:

     0.065     0.075

The Real Estate Securities Portfolio:

     0.10     0.11

The Commodity Returns Strategy Portfolio:

     0.10     0.11

The International Equity Portfolio:

     0.10%/0.13 %*      0.11%/0.15 %* 

The Institutional International Equity Portfolio:

     0.10%/0.13 %*      0.11%/0.15 %* 

The Emerging Markets Portfolio:

     0.13     0.15

 

* Mellon Capital manages two different strategies, under separate Portfolio Management Agreements, in each of the International Equity and Institutional International Equity Portfolios: a developed markets strategy with a fee of 0.10% or 0.11% (based on asset levels as described above) and an emerging markets strategy with a fee of 0.13% or 0.15%.

For its services to The Core Fixed Income Portfolio and The U.S. Government Fixed Income Securities Portfolio, Mellon Capital receives a fee, based on the average daily net asset value of that portion of the assets of the Portfolios managed by it, at an annual rate of 0.06%. During the fiscal year ended June 30, 2013 Mellon received fees of [ ] % of the average daily net assets for each portion of The Core Fixed Income Portfolio and The U.S. Government Fixed Income Securities Portfolio allocated to Mellon.

The Portfolio Managers for the Value Equity, Institutional Value Equity, Growth Equity, Institutional Growth Equity, Small Capitalization Equity and Institutional Small Capitalization Equity Portfolios are Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford. The Portfolio Managers for the Real Estate Securities, Commodity Returns Strategy, International Equity, Institutional International Equity and Emerging Markets Portfolios are Karen Wong, Warren Chiang, Peter Goslin and Kristin Crawford.

Karen Q. Wong, CFA is a Managing Director and Head of Equity Portfolio Management at Mellon Capital.

Warren Chiang, CFA is a Managing Director and Head of Active Equity Strategies at Mellon Capital. He has an M.B.A. and a B. S. from the University of California at Berkeley. Mr. Chiang has 16 years of investment experience and tenure at Mellon Capital. Mr. Chiang manages the entire team of portfolio managers and researchers for all U.S. and international active equity strategies. He is responsible for the refinement and implementation of the active equity portfolio management process.

Ronald Gala, CFA is a Director, Team Leader and Senior Portfolio Manager for the Active Equity Strategies. Mr. Gala has 27 years of investment experience with tenure of 20 years between Mellon Capital and Mellon Equity Associates, LLP. He is a member and past president of the CFA Society of Pittsburgh and a member of the CFA Institute. He has an M.B.A. from the University of Pittsburgh and a B.S. from Duquesne University.

Kristin Crawford is a Vice President and Senior Portfolio Manager for the Active Equity Strategies. Ms. Crawford has 19 years of investment experience with tenure of 13 years between Mellon Capital and Franklin Portfolio Associates. She has an M.B.A. from Suffolk University and a B.S. from Smith College. Prior to joining Mellon Capital, she was a vice president and portfolio manager at Franklin Portfolio Associates.

Peter Goslin, CFA is a Vice President and Senior Portfolio Manager for the Active Equity Strategies. Mr. Goslin has 20 years of investment experience with tenure of 14 years at Mellon Capital. Mr. Goslin has an M.B.A. from the University of Notre Dame in Finance. Prior to joining Mellon Capital, Mr. Goslin was a derivatives trader and NASDAQ market maker for Merrill Lynch and ran Merrill’s Equity Index Option desk at the Chicago Mercantile Exchange.

 

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Day-to-day investment decisions for the portions of The Core Fixed Income Portfolio and The U.S. Government Fixed Income Securities Portfolio allocated to Mellon Capital are the responsibility of David C. Kwan, CFA Ms. Zandra Zelaya, CFA, and Mr. Lowell J. Bennett, CFA. Mr. Kwan is a Managing Director, Fixed Income Management of Mellon Capital with 22 years of investment experience at the firm. He earned both a B.S. and an M.B.A. at the University of California at Berkeley. Ms. Zelaya is a Director of Fixed Income Management of Mellon Capital with 17 years of investment experience and 15 years at the firm. She earned a B.S. at California State University at Haward. Mr. Bennett is a Managing Director, Investment Strategist at Mellon Capital with 25 years of finance and investment experience and 15 years at the firm. He earned both a B.S.I.E and M.B.A. from Stanford University.

As of June 30, 2013, Mellon Capital had assets under management totaling approximately $313 billion, which includes overlay strategies.

The Value Equity Portfolio, The Institutional Value Equity Portfolio, The Growth Equity Portfolio, The Institutional Growth Equity Portfolio, The Small Capitalization Equity Portfolio, The Institutional Small Capitalization Equity Portfolio, The Real Estate Securities Portfolio, The Commodity Returns Strategy Portfolio, The International Equity Portfolio, The Institutional International Equity Portfolio, The Emerging Markets Portfolio, The Core Fixed Income Portfolio, The Fixed Income Opportunity Portfolio, The U.S. Government Fixed Income Securities Portfolio, The U.S. Corporate Fixed Income Securities Portfolio, The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio, The Short-Term Municipal Bond Portfolio, The Intermediate Term Municipal Bond Portfolio and The Intermediate Term Municipal Bond II Portfolio: (From the Supplement filed on June 28, 2013)

1. The following replaces the second paragraph under the “Calculating NAV” section of “Shareholder Information” on page 118 of the Prospectus:

The value of each Portfolio’s investments is generally determined by current market quotations. When reliable market quotations are not readily available for any security, the fair value of that security will be determined by a committee established by the Trust’s Board of Trustees (“Board”) in accordance with procedures adopted by the Board. The fair valuation process is designed to value the subject security at the price a Portfolio would reasonably expect to receive upon its current sale. Fair value pricing may be employed, for example, if the value of a security held by a Portfolio has been materially affected by an event that occurs after the close of the market in which the security is traded, in the event of a trading halt in a security for which market quotations are normally available or with respect to securities that are deemed illiquid. When this fair value pricing method is employed, the prices of securities used in the daily computation of a Portfolio’s NAV per share may differ from quoted or published prices for the same securities. Additionally, security valuations determined in accordance with the fair value pricing method may not fluctuate on a daily basis, as would likely occur in the case of securities for which market quotations are readily available. Consequently, changes in the fair valuation of portfolio securities may be less frequent and of greater magnitude than changes in the price of portfolio securities valued based on market quotations.

The Fixed Income Opportunity Portfolio: (From the Supplement filed on June 28, 2013)

1. The following replaces the “Investment Adviser” and “Investment Subadvisor” sections on page 57 of the Prospectus:

Investment Adviser

HC Capital Solutions is the Portfolio’s investment adviser with responsibility for the management of the Portfolio’s assets, including all investments in other investment companies.

Portfolio Manager:

Thomas Cowhey, CFA has managed the Portfolio since June, 2013.

Investment Subadvisor

Seix, Fort Washington Investment Advisors, Inc. (“Fort Washington”) and PIMCO are the Specialist Managers for the Portfolio with responsibility for the management of the Portfolio’s assets that are invested directly in fixed income securities.

Portfolio Managers:

Fort Washington: Brendan White and Timothy Jossart have co-managed the portion of the Portfolio allocated to Fort Washington since May, 2012.

 

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PIMCO: Curtis Mewbourne has managed the portion of the Portfolio allocated to PIMCO since January, 2010.

Seix: Michael Rieger, Michael Kirkpatrick and Brian Nold have managed that portion of the Portfolio allocated to Seix since November, 2007.

2. The following supplements the “Advisory Services – HC Capital Solutions” disclosure on page 115 of the Prospectus:

Mr. Thomas Cowhey, CFA acts as a portfolio manager for the Real Estate Securities and Fixed Income Opportunity Portfolios. Mr. Cowhey is the Chief Investment Strategist for the Advisor and has been with the Advisor since 2000.

The Real Estate Securities Portfolio: (From the Supplement filed on June 10, 2013) Effective immediately, The Real Estate Securities Portfolio is closed to new investors.

The Commodity Returns Strategy Portfolio: (From the Supplement filed on June 10, 2013) Effective June 10, 2013, The Commodity Returns Strategy Portfolio’s classification changed from non-diversified to diversified. All references to the Portfolio are changed accordingly.

International Equity Portfolio and Institutional International Equity Portfolio: (From the Supplement filed on June 10, 2013)

1. The following replaces the first paragraph under the “Artisan Partners Limited Partnership” section of the “Specialist Manager Guide” on page 127 of the Prospectus:

Artisan Partners Limited Partnership (“Artisan”) serves as a Specialist Manager for The International Equity and The Institutional International Equity Portfolios. Artisan, the principal office of which is located at 875 E. Wisconsin Avenue, Suite 800, Milwaukee, WI 53202, has provided investment management services for international equity assets since 1995. As of June 30, 2012, Artisan managed total assets in excess of $64 billion, of which approximately $37 billion consisted of mutual fund assets. Artisan Partners is a limited partnership organized under the laws of Delaware. Artisan Partners is managed by its general partner, Artisan Investments GP LLC, a Delaware limited liability company wholly-owned by Artisan Partners Holdings LP (Artisan Partners Holdings). Artisan Partners Holdings is a limited partnership organized under the laws of Delaware whose sole general partner is Artisan Partners Asset Management Inc., a Delaware Corporation. Artisan Partners was founded in March 2009 and succeeded to the investment management business of Artisan Partners Holdings during 2009. Artisan Partners Holdings was founded in December 1994 and began providing investment management services in March 1995.

The International Equity Portfolio: (From the Supplement filed on April 25, 2013)

 

1. The following replaces the section of the Prospectus pertaining to Causeway Capital Management LLC under the “Portfolio Managers” section on page 40 of the Prospectus:

Causeway: Sarah H. Ketterer, Harry W. Hartford, James A. Doyle, Jonathan P. Eng and Kevin Durkin have co-managed that portion of the Portfolio allocated to Causeway since December, 2006 and Conor Muldoon has co-managed that portion of the Portfolio allocated to Causeway since September, 2010. Foster Corwith and Alessandro Valentini have co-managed the portion of the Portfolio allocated to Causeway since April 2013.

The Institutional International Equity Portfolio: (From the Supplement filed on April 25, 2013)

 

1. The following replaces the section of the Prospectus pertaining to Causeway Capital Management LLC under the “Portfolio Managers” section on page 44 of the Prospectus:

Causeway: Sarah H. Ketterer, Harry W. Hartford, James A. Doyle, Jonathan P. Eng and Kevin Durkin have co-managed that portion of the Portfolio allocated to Causeway since November, 2009 and Conor Muldoon has co-managed that portion of the Portfolio allocated to Causeway since September, 2010. Foster Corwith and Alessandro Valentini have co-managed the portion of the Portfolio allocated to Causeway since April 2013.

 

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The International Equity Portfolio and The Institutional International Equity Portfolio: (From the Supplement filed on April 25, 2013)

1. The following replaces the third paragraph under the “Causeway Capital Management LLC” section of the “Specialist Manager Guide” on page 130 of the Prospectus:

Day-to-day management of those assets of The International Equity and Institutional International Equity Portfolios allocated to Causeway is the responsibility of Sarah H. Ketterer, Harry W. Hartford, James A. Doyle, Jonathan P. Eng, Kevin Durkin, Conor Muldoon, Foster Corwith and Alessando Valentini. Ms. Ketterer, Mr. Hartford, Mr. Doyle, Mr. Eng, and Mr. Durkin have been investment professionals with Causeway since 2001, Mr. Muldoon has been an investment professional with Causeway since 2003 and Messrs Corwith and Valentini have been investment professionals with the firm since 2006. Ms. Ketterer and Mr. Hartford were co-founders of Causeway in 2001, and serve as the firm’s chief executive officer and president, respectively. Ms. Ketterer and Mr. Hartford previously served as co-heads of the International and Global Value Equity Team of the Hotchkis and Wiley division of Merrill Lynch Investment Managers, L.P. (“Hotchkis and Wiley”). Messrs. Doyle, Eng, and Durkin, directors of Causeway, were also associated with the Hotchkis and Wiley International and Global Value Equity Team prior to joining Causeway in 2001. Mr. Muldoon, a director of Causeway, previously served as an investment consultant for Fidelity Investments as a liaison between institutional clients and investment managers within Fidelity. Mr. Corwith, a director and fundamental portfolio manager, previously served as a research associate at Deutsche Asset Management where he was responsible for researching consumer staple companies. Mr. Valentini, a director and fundamental portfolio manager, previously worked at Thornburg Investment Management, where he conducted fundamental research focusing on the European telecommunication and Canadian oil sectors.

The Real Estate Securities Portfolio:

Upon the recommendation of the Adviser, the Board of Trustees of HC Capital Trust has approved a modification of the Principal Investment Strategies of the Portfolio to allow the Portfolio to implement its real estate securities strategies by investing primarily in shares of other real estate-oriented investment companies, such as exchange-traded funds (“ETFs”). Accordingly, the following changes to the disclosure related to the Real Estate Securities Portfolio are effective April 26, 2013:

1. The following replaces the “Fees and Expenses” section on page 26 of the Prospectus:

Fees and Expenses

The fee tables below describe the fees and expenses that you may pay if you buy and hold HC Advisors Shares of the Portfolio.

Shareholder Fees

(fees paid directly from your investment)

 

Maximum Sales Charges

     None   

Maximum Redemption Fee

     None   

Annual Operating Expenses

(expenses that you pay each year as a percentage of the value of your investment)

 

Management Fees (based on asset allocations among Specialist Managers, see “Advisory Services – Specialist Managers”)

     0.05

Other Expenses

     0.08

Distribution and/or Service (12b-1) Fees

     0.25

Acquired Fund Fees and Expense

     0.18

Total Annual Portfolio Operating Expenses

     0.56

Example: This Example is intended to help you compare the cost of investing in the Portfolio with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Portfolio for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Portfolio’s operating expenses remain the same. Although your actual cost may be higher or lower, based on these assumptions, your costs would be:

 

1 Year

   $ 57   

3 Years

   $ 179   

5 Years

   $ 313   

10 Years

   $ 701   

 

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2. The following supplements the “Principal Investment Strategies” disclosure on page 26 of the Prospectus:

The Portfolio may implement its principal investment strategy by investing up to 100% of its assets in exchange-traded funds, that themselves invest in real estate-related securities.

3. The following supplements the “Principal Investment Risks” disclosure on page 27 of the Prospectus:

 

 

Investment in Other Investment Companies Risk – As with other investments, investments in other investment companies are subject to market and selection risk. In addition, if the Fund acquires shares of investment companies, shareholders bear both their proportionate share of expenses in the Fund (including management and advisory fees) and, indirectly, the expenses of the other investment companies.

 

 

Exchange-Traded Funds Risk – An investment by the Portfolio in ETFs generally presents the same primary risks as an investment in other investment companies. In addition, an ETF may be subject to the following: (1) a discount of the ETF’s shares to its net asset value; (2) failure to develop or maintain an active trading market for the ETF’s shares; (3) the listing exchange halting trading of the ETF’s shares; (4) failure of the ETF’s shares to track the referenced asset; and (5) holding troubled securities in the referenced index or basket of investments.

4. The following replaces the “Investment Adviser” and “Investment Subadvisor” sections on page 30 of the Prospectus:

Investment Adviser

HC Capital Solutions is the Portfolio’s investment adviser with responsibility for the management of the Portfolio’s assets, including all investments in other investment companies.

Portfolio Manager:

Thomas Cowhey, CFA has managed the Portfolio since April, 2013.

Investment Subadvisor

Wellington Management Company LLP (“Wellington Management”) and SSgA FM are the Specialist Managers for the Portfolio with responsibility for the management of the Portfolio’s assets that are invested directly in real estate securities.

Wellington Management: Bradford D. Stoesser has managed the Portfolio since September, 2010.

SSgA FM: John Tucker, CFA and Michael Feehily, CFA have not yet begun providing portfolio management services to the Portfolio.

5. The following supplements the “More Information About Fund Investments and Risks” disclosure related to the Real Estate Securities Portfolio on page 91 of the Prospectus:

The Portfolio may implement its investment strategy by investing in exchange traded investment companies, known as “ETFs,” that themselves invest in the equity and debt securities issued by real estate-related companies including real estate investment trusts (REITs). For more information on ETFs, see “Investments in Other Investment Companies” on page 114 of this Prospectus.

6. The following supplements the “Investments in Other Investment Companies” disclosure on page 114 of the Prospectus:

Additionally, the Real Estate Securities Portfolio may invest up to 100% of its assets in ETFs that invest in the securities of real estate related companies in reliance on provisions of the Investment Company Act that permit such investments so long as the investing fund, together with any affiliates, does not own more than 3% of the outstanding voting securities of the acquired fund. Under these provisions, the Real Estate Securities Portfolio is required to vote all proxies of the funds it owns in the same proportion as the vote of all other holders of such securities.

 

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7. The following supplements the “Advisory Services – HC Capital Solutions” disclosure on page 115 of the Prospectus:

Mr. Thomas Cowhey, CFA acts as a portfolio manager for the Real Estate Securities Portfolio. Mr. Cowhey is the Chief Investment Strategist for the Advisor and has been with the Advisor since 2000.

The Short-Term Municipal Bond Portfolio: (From the Supplement filed on April 18, 2013)

 

2. The following replaces the section of the Prospectus under the “Portfolio Managers” section on page 73 of the Prospectus:

Breckinridge: Peter Coffin, David Madigan, and Martha Field Hodgman have co-managed the Portfolio since March, 2006. Susan Mooney and Matthew Buscone have co-managed the Portfolio since February, 2007 and July, 2008, respectively. Ji Young has managed the Portfolio since March 2013.

The Intermediate Term Municipal Bond II Portfolio: (From the Supplement filed on April 18, 2013)

 

  1. The following replaces the section of the Prospectus under the “Portfolio Managers” section on page 81 of the Prospectus:

Breckinridge: Peter Coffin, David Madigan, Martha Field Hodgman, Susan Mooney and Matthew Buscone have co-managed the Portfolio since March, 2010 and Ji Young has managed the Portfolio since March 2013.

The Short-Term Municipal Bond Portfolio and The Intermediate Term Municipal Bond II Portfolio: (From the Supplement filed on April 18, 2013)

The following replaces the third and fourth paragraphs under the “Breckinridge Capital Advisors, Inc” section of the “Specialist Manager Guide” on page 129 of the Prospectus:

The portfolio management team is led by a team of investment professionals at Breckinridge, including the following individuals who are jointly and primarily responsible for making day-to-day investment decisions: Peter B. Coffin, President of Breckinridge since 1993, David Madigan, Chief Investment Officer at Breckinridge since 2003, Martha Field Hodgman, Executive Vice President at Breckinridge since 2001, Susan Mooney, Senior Vice President of Breckinridge since 2007, Matthew Buscone, Vice President, at Breckinridge since 2002 and Ji Young, Portfolio Manager since March 2012.

Prior to founding Breckinridge, Mr. Coffin was a Senior Vice-President and portfolio manager with Massachusetts Financial Services, where he was also a member of the firm’s Fixed Income Policy Committee. From 1996 to 2002, Mr. Madigan was Executive Vice-President at Thomson Financial. He has also served as a portfolio manager at Banker’s Trust and Prudential Insurance (managing single state municipal bond funds), as well as Chief Municipal Strategist for Merrill Lynch. From 1993 to 2001, Ms. Hodgman served as a Vice President in the Fixed Income Management Group of Loomis Sayles & Co. L.P. She has also been a portfolio manager for John Hancock Advisors, Inc. (managing state-specific tax exempt mutual funds) and an analyst for the Credit Policy Committee of Putnam Investments. From 2003-2007 Ms. Mooney was Director of Fixed Income and principal at Freedom Capital Management, LLC, where she managed institutional fixed income assets for pension funds, corporations and endowments. Prior to that position she was Managing Director at Harbor Capital. Mr. Buscone has been a Portfolio Manager since 2008 after having served as a trader at Breckinridge from 2002-2008. From 1992-2002 he was a Trader and Portfolio Manager for both taxable and tax-exempt portfolios at David L. Babson and Mellon Private Asset Management. Ms. Young joined Breckinridge in October 2008 as a member of the Credit Research Team and transitioned to Portfolio Management in March 2012. Prior to joining Breckinridge she was a credit analyst within the Public Finance Group at Assured Guaranty.

The Fixed Income Opportunity Portfolio: (From the Supplement filed on March 5, 2013) Effective immediately, Michael Rieger will no longer serve as a portfolio manager for The Fixed Income Opportunity Portfolio managed by Seix Investment Advisors, LLC (“Seix”).

 

  2. The following replaces the section of the Prospectus with respect to Seix under the “Portfolio Managers” section on page 57 of the Prospectus:

Seix: Michael Kirkpatrick and Brian Nold have managed the portion of the Portfolio allocated to Seix since November, 2007 and Vincent Flanagan has managed the Portfolio since February, 2013.

 

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  3. The following replaces the third paragraph under “Seix Investment Advisors LLC” of the “Specialist Manager Guide” on page 135 of the Prospectus:

Day-to-day high yield investment decisions for The Fixed Income Opportunity Portfolio are the responsibility of Michael Kirkpatrick, Brian Nold and Vincent Flanagan. Michael Kirkpatrick, Senior Portfolio Manager and Senior High Yield Research Analyst, focuses principally on the Flagship High Yield Portfolios in addition to a High Yield Unconstrained strategy. Prior to joining Seix in 2002, Mr. Kirkpatrick was a Senior Analyst at Oppenheimer Funds, Inc. covering the Telecommunications and Cable industries. Mr. Nold, Senior Portfolio Manager and Senior High Yield Research Analyst, focuses on a High Yield Unconstrained strategy in addition to the Flagship High Yield Portfolios. Before joining Seix in 2003, he was a High Yield Analyst at Morgan Stanley in Global High Yield Research. Vincent Flanagan, Portfolio Manager and Senior High Yield Research Analyst, is primarily focused on bank loans. Prior to joining Seix in 2006, Mr. Flanagan was the director of research for Assurant, Inc.

The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio: (From the Supplement filed on March 5, 2013)

 

  1. The following supplements the “Portfolio Managers” section on page 69 of the Prospectus:

Mellon Capital: Mr. David C. Kwan, Ms. Zandra Zelaya and Mr. Gregg Lee have co-managed the Portfolio since December, 2012.

The Core Fixed Income Portfolio: (From the Supplement filed on March 5, 2013)

 

  1. The following supplements the “Portfolio Managers” section on page 52 of the Prospectus:

Mellon Capital: Mr. David C. Kwan and Ms. Zandra Zelaya have co-managed the Portfolio since December, 2010 and Mr. Gregg Lee has managed the Portfolio since December, 2012.

The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio and The Core Fixed Income Portfolio: (From the Supplement filed on March 5, 2013)

The following replaces the “Mellon Capital Management Corporation” section of the “Specialist Manager Guide” on page 134 of the Prospectus:

Mellon Capital Management Corporation (“Mellon Capital”) serves as a Specialist Manager for The Core Fixed Income Portfolio, The U.S. Government Fixed Income Securities Portfolio and The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio. Mellon Capital, which was organized as a Delaware corporation in 1983, is headquartered at 50 Fremont Street, Suite 3900, San Francisco, CA 94105. Mellon Capital is a wholly-owned indirect subsidiary of The Bank of New York Mellon Corporation (“BNY Mellon”).

For its services to The Core Fixed Income Portfolio and The U.S. Government Fixed Income Securities Portfolio, Mellon Capital receives a fee, based on the average daily net asset value of that portion of the assets of the Portfolios managed by it, at an annual rate of 0.12%. Effective September 1, 2012, Mellon Capital receives a fee, based on the average daily net asset value of that portion of the assets of the Portfolios managed by it, at an annual rate of 0.06%. For its services to The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio, Mellon Capital receives a fee based on the average daily net asset value of that portion of the assets of the Portfolio managed by it, at an annual rate of 0.06%. During the fiscal year ended June 30, 2012 Mellon received fees of 0.12% of the average daily net assets for each portion of The Core Fixed Income Portfolio and The U.S. Government Fixed Income Securities Portfolio allocated to Mellon.

Day-to-day investment decisions for the portions of The Core Fixed Income Portfolio, The U.S. Government Fixed Income Securities Portfolio and The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio allocated to Mellon Capital are the responsibility of David C. Kwan, CFA, Ms. Zandra Zelaya, CFA and Mr. Gregg Lee, CFA. Mr. Kwan is a Managing Director, Fixed Income Management of Mellon Capital with 22 years of investment experience at the firm. He earned both a B.S. and an M.B.A. at the University of California at Berkeley. Ms. Zelaya is a Director of Fixed Income Management of Mellon Capital with 17 years of investment experience and 15 years at the firm. She earned a B.S. at California State University at Haward. Mr. Gregg Lee is a Vice President, Senior Portfolio Manager at Mellon Capital with 23 years of investment experience and 23 year at the firm. He earned a B.S. at the University of California at Davis.

 

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As of June 30, 2012, Mellon Capital had assets under management totaling approximately $240 billion, which includes overlay strategies.

The Core Fixed Income Portfolio and The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio: (From the Supplement filed on January 8, 2013) Effective January 8, 2013, the investment advisory relationship between the Trust and BlackRock Financial Management, Inc. (“BlackRock”) with respect to The Core Fixed Income Portfolio and The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio has been terminated. Any and all references to BlackRock are hereby removed.

The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio: (From the Supplement filed on December 11, 2012) At a meeting, held on December 4, 2012, the Board of Trustees (the “Board”) for HC Capital Trust (the “Trust”) approved the engagement of Mellon Capital Management Corporation (“Mellon Capital”) as an additional investment advisory organization (“Specialist Manager”) to manage a portion of the assets of The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio of the Trust.

1. The following replaces the “Annual Operating Expenses” section on page 66 of the Prospectus:

Annual Operating Expenses

(expenses that you pay each year as a percentage of the value of your investment)

 

Management Fees

     0.11

Distribution and/or Service (12b-1)Fees

     0.25

Other Expenses

     0.08

Total Annual Portfolio Operating Expenses

     0.44

Example: This Example is intended to help you compare the cost of investing in the Portfolio with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Portfolio for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Portfolio’s operating expenses remain the same. Although your actual cost may be higher or lower, based on these assumptions, your costs would be:

 

1 Year

   $ 45   

3 Years

   $ 141   

5 Years

   $ 246   

10 Years

   $ 555   

2. The following supplements the “Principal Investment Risks” section on page 67 of the Prospectus:

 

 

Multi-Manager Risk – The risk that the Trust may be unable to (a) identify and retain Specialist Managers who achieve superior investment records relative to other similar investments, (b) pair Specialist Managers that have complementary investment styles, or (c) effectively allocate Portfolio assets among Specialist Managers to enhance the return and reduce the volatility that would typically be expected of any one management style. A multi-manager Portfolio may, under certain circumstances, incur trading costs that might not occur in a Portfolio that is served by a single Specialist Manager.

3. The following replaces the “Investment Subadvisers” section on page 69 of the Prospectus:

Blackrock and Mellon Capital are the Specialist Managers for the Portfolio.

4. The following supplements the “Specialist Managers” section under “The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio” on page 103 of the Prospectus:

 

The Mellon Capital Investment Selection Process    Mellon Capital employs a disciplined approach which seeks to gain exposure to securities and sectors like those contained in the Barclays Capital US Securitized Index. It begins by identifying and isolating the major components and sectors and assessing the key characteristics of the index. After analyzing these factors, Mellon Capital Management then invests in securities designed to gain exposure to these different sectors, and that have characteristics that are similar to those which are found in the index. In this process, they also focus on relative value and issue specific risk in order to efficiently and cost effectively gain exposure to the securitized sector.

 

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5. The following replaces the paragraph with respect to “The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio” under “More Information About Fund Investments and Risks” on page 117 of the Prospectus:

The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio – The Portfolio is managed by two Specialist Managers, each of whom is compensated in accordance with a different fee schedule. Although asset allocations and fees payable to the Specialist Managers may vary, the figures assume an actual allocation of assets at June 30, 2012 of 0% BlackRock and 100% Mellon Capital.

The Core Fixed Income Portfolio:

1. The following replaces the “Annual Operating Expenses” section on page 49 of the Prospectus:

Annual Operating Expenses

(expenses that you pay each year as a percentage of the value of your investment)

 

Management Fees (based on asset allocations among Specialist Managers, see “Advisory Services – Specialist Managers”)

     0.17

Distribution and/or Service (12b-1)Fees

     0.25

Other Expenses

     0.08

Total Annual Portfolio Operating Expenses

     0.50

Example: This Example is intended to help you compare the cost of investing in the Portfolio with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Portfolio for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes the reinvestment of all dividends and distributions in shares of the Portfolio and that your investment has a 5% return each year and that the Portfolio’s operating expenses remain the same. Although your actual cost may be higher or lower, based on these assumptions, your costs would be:

 

1 Year

   $ 51   

3 Years

   $ 160   

5 Years

   $ 280   

10 Years

   $ 628   

2. The following supplements the “Specialist Managers” section under “The Core Fixed Income Portfolio” on page 99 of the Prospectus:

 

The Mellon Capital Investment Selection Process   

Mellon Capital currently manages assets for the Portfolio using two separate and distinct strategies.

 

With respect to the portion of the Portfolio invested in investment grade mortgage-backed and asset-backed securities, Mellon Capital employs a disciplined approach which seeks to gain exposure to securities and sectors like those contained in the Barclays Capital US Government Index. It begins by identifying and isolating the major components and sectors and assessing the key characteristics of the index. After analyzing these factors, Mellon Capital Management then invests in securities designed to gain exposure to these different sectors, and that have characteristics that are similar to those which are found in the index. In this process, they also focus on relative value and issue specific risk in order to efficiently and cost effectively gain exposure to the government sector.

 

With respect to the portion of the Portfolio invested in securities issued or fully guaranteed by the U.S. Government, Federal Agencies or sponsored agencies, Mellon Capital employs a disciplined approach which seeks to gain exposure to securities and sectors like those contained in the Barclays Capital US Securitized Index. It begins by identifying and isolating the major components and sectors and assessing the key characteristics of the index. After analyzing these factors, Mellon Capital Management then invests in securities designed to gain exposure to these different sectors, and that have characteristics that are similar to those which are found in the index. In this process, they also focus on relative value and issue specific risk in order to efficiently and cost effectively gain exposure to the securitized sector.

 

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3. The following replaces the paragraph with respect to “The Core Fixed Income Portfolio” under “More Information About Fund Investments and Risks” on page 117 of the Prospectus:

The Core Fixed Income Portfolio – The Portfolio is managed by three Specialist Managers, each of whom is compensated in accordance with a different fee schedule. Although asset allocations and fees payable to the Specialist Managers may vary, the figures assume an actual allocation of assets at June 30, 2012 of 0% BlackRock, 66% Mellon Capital and 34% Seix.

The Fixed Income Opportunity Portfolio:

1. The following replaces the “Annual Operating Expenses” section on page 53 of the Prospectus:

Annual Operating Expenses

(expenses that you pay each year as a percentage of the value of your investment)

 

Management Fees (based on asset allocations among Specialist Managers, see “Advisory Services – Specialist Managers”)

     0.31

Distribution and/or Service (12b-1) Fees

     0.25

Other Expenses

     0.08

Total Annual Portfolio Operating Expenses

     0.64

Example: This Example is intended to help you compare the cost of investing in the Portfolio with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Portfolio for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes the reinvestment of all dividends and distributions in shares of the Portfolio and that your investment has a 5% return each year and that the Portfolio’s operating expenses remain the same. Although your actual cost may be higher or lower, based on these assumptions, your costs would be:

 

1 Year

   $ 65   

3 Years

   $ 205   

5 Years

   $ 357   

10 Years

   $ 798   

2. The following replaces the second paragraph under “Seix Investment Advisors LLC” in the Specialist Manager Guide on page135 of the Prospectus:

For its services to The Fixed Income Opportunity Portfolio Seix receives a fee, based on the average daily net asset value of the assets of the Portfolio under its management at an annual rate of 0.40% for the first $100 million of the Combined Assets (as defined below), 0.25% on the next $200 million of the Combined Assets, and 0.20% on the balance of the Combined Assets. For the purpose of computing Seix’s fee for The Fixed Income Opportunity Portfolio, the term “Combined Assets” shall mean the sum of (i) the net assets of the Portfolio; and (ii) the net assets of each other Hirtle Callaghan account to which Seix provides similar services. During the fiscal year ended June 30, 2012 Seix received a fee of 0.42% of the average daily net assets of that portion of The Fixed Income Opportunity Portfolio allocated to Seix.

PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE.

 

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Supplement to Prospectus

HC Strategic Shares

Dated November 1, 2012

HC Capital Trust

The date of this Supplement is August 5, 2013

On August 2, 2013, Mellon Capital Management Corporation was added as an additional Specialist Manager to each of the Value Equity, Institutional Value Equity, Growth Equity, Institutional Growth Equity, Small Capitalization Equity, Institutional Small Capitalization Equity, Real Estate Securities, Commodity Returns Strategy, International Equity, Institutional International Equity and Emerging Markets Portfolios pursuant to Portfolio Management Agreements approved by the shareholders of the respective Portfolios.

Additionally, on August 2, 2013, Ariel Investments, LLC was added as an additional Specialist Manager in the Small Capitalization Equity and Institutional Small Capitalization Equity Portfolios pursuant to Portfolio Management Agreements approved by the shareholders of the respective Portfolios.

The following material supplements the Prospectus dated November 1, 2012 to incorporate information about the new Specialist Managers.

The Value Equity Portfolio:

1. The following replaces the “Investment Subadvisers” section on page 5 of the Prospectus:

Investment Subadvisers

AllianceBernstein L.P. (“AllianceBernstein”), Institutional Capital, LLC (“ICAP”) Mellon Capital Management Corporation (“Mellon Capital”) and SSgA Funds Management, Inc. (“SSgA FM”) are the Specialist Managers for the Portfolio.

Portfolio Managers:

AllianceBernstein: Gerry Paul has managed the portion of the Portfolio allocated to AllianceBernstein since September, 2009, and Greg Powell has co-managed the portion of the Portfolio allocated to AllianceBernstein since July, 2010.

ICAP: Jerrold K. Senser and Thomas R. Wenzel have managed the portion of the Portfolio allocated to ICAP since August 25, 1995. Thomas C. Cole has managed the portion of the Portfolio allocated to ICAP since July, 2012.

Mellon Capital: Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed the portion of the Portfolio allocated to SSgA FM since July, 2012 and July, 2001, respectively.

2. The following replaces the “Specialist Managers.” section on page 82 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Institutional Capital, LLC (“ICAP”) and AllianceBernstein L.P. (“AllianceBernstein”) are currently responsible for implementing the active component of the Portfolio’s investment strategy. Additionally, a portion of the Portfolio is managed using “passive” or “index” investment approaches designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index. Mellon Capital and SSgA FM are currently responsible for implementing the passive component for the Portfolio’s investment strategy. The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

 

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3. The following is added to the Section “More Information About Fund Investments and Risks—The Value Equity Portfolio” on page 82 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” “or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the Russell 1000 Value(R) Index. The particular segments of the Russell 1000(R) Value Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The Russell 1000(R) Value Index is an unmanaged, market cap-weighted index, which is reviewed and reconstituted each year. Further information about the Russell 1000(R) Value Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the Russell 1000(R) Value Index.

The Institutional Value Equity Portfolio

1. The following replaces the “Investment Subadvisers” section on page 9 of the Prospectus:

Investment Subadvisers

AllianceBernstein L.P. (“AllianceBernstein”), Institutional Capital, LLC (“ICAP”), Pacific Investment Management Company LLC (“PIMCO”), Mellon Capital and SSgA FM are the Specialist Managers for the Portfolio.

Portfolio Managers:

AllianceBernstein: Gerry Paul has managed the portion of the Portfolio allocated to AllianceBernstein since September, 2009, and Greg Powell has co-managed the portion of the Portfolio allocated to AllianceBernstein since July, 2010.

ICAP: Jerrold K. Senser and Thomas R. Wenzel have co-managed the portion of the Portfolio allocated to ICAP since July, 2008. Thomas C. Cole has managed the portion of the Portfolio allocated to ICAP since July, 2012.

PIMCO: Saumil Parikh has managed a portion of the Portfolio allocated to PIMCO since April, 2009.

Mellon Capital. Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed the portion of the Portfolio allocated to SSgA FM since July, 2012 and July, 2008, respectively.

2. The following replaces the “Specialist Managers.” section on page 83 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Institutional Capital, LLC (“ICAP”), AllianceBernstein L.P. (“AllianceBernstein”) and Pacific Investment Management Company LLC (“PIMCO”) are currently responsible for implementing the active component of the Portfolio’s investment strategy. Additionally, a portion of the Portfolio is managed using “passive” or “index” investment approaches designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component for the Portfolio’s investment strategy. The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The Institutional Value Equity Portfolio” on page 83 of the Prospectus:

 

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The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the Russell 1000(R) Value Index. The particular segments of the Russell 1000(R) Value Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The Russell 1000(R) Value Index is an unmanaged, market cap-weighted index, which is reviewed and reconstituted each year. Further information about the Russell 1000(R) Value Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the Russell 1000(R) Value Index.

The Growth Equity Portfolio:

1. The following replaces the “Investment Subadvisers” section on page 13 of the Prospectus:

Investment Subadvisers

Jennison Associates LLC (“Jennison”), Sustainable Growth Advisers LP (“SGA”), Mellon Capital and SSgA FM are the Specialist Managers for the Portfolio.

Portfolio Managers:

Jennison: Kathleen A. McCarragher has managed that portion of the Portfolio allocated to Jennison since January, 2005.

SGA: George P. Fraise, Gordon M. Marchand and Robert L. Rohn have co-managed that portion of the Portfolio allocated to SGA since June, 2006.

Mellon Capital. Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed the portion of the Portfolio allocated to SSgA FM since July, 2012 and July, 2001, respectively.

2. The following replaces the “Specialist Managers.” section on page 85 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Jennison and SGA are currently responsible for implementing the active component of the Portfolio’s investment strategy. The remaining portion of the Portfolio is managed using “passive” or “index” investment approaches that are designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index. Mellon Capital and SSgA FM are currently responsible for implementing the passive component of the Portfolio’s investment strategy. The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The Growth Equity Portfolio” on page 85 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a strict “passive” “indexing or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the Russell 1000(R) Growth Index. The particular segments of the Russell 1000(R) Growth Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The Russell 1000(R) Growth Index is an unmanaged, market cap-weighted index, which is reviewed and reconstituted each year. Further information about the Russell 1000(R) Growth Index

 

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appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the Russell 1000(R) Growth Index.

The Institutional Growth Equity Portfolio

1. The following replaces the “Investment Subadvisers” section on page 17 of the Prospectus:

Investment Subadvisers

Jennison Associates LLC (“Jennison”), PIMCO, Sustainable Growth Advisers LP (“SGA”), Mellon Capital and SSgA FM are the Specialist Managers for the Portfolio.

Portfolio Managers:

Jennison: Kathleen A. McCarragher has managed the portion of the Portfolio allocated to Jennison since August, 2008.

PIMCO: Saumil Parikh has managed the portion of the Portfolio allocated to PIMCO since August, 2008.

SGA: George P. Fraise, Gordon M. Marchand and Robert L. Rohn have co-managed that portion of the Portfolio allocated to SGA since August, 2008.

Mellon Capital. Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed the portion of the Portfolio allocated to SSgA FM since July 2012 and August, 2008 respectively.

2. The following replaces the “Specialist Managers.” section on page 86 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Jennison Associates LLC (“Jennison”), PIMCO and Sustainable Growth Advisers, LP (“SGA”) are currently responsible for implementing the active component of the Portfolio’s investment strategy. The remaining portion of the Portfolio is managed using “passive” or “index” investment approaches that are designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component of the Portfolio’s investment strategy. The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The Institutional Growth Equity Portfolio” on page 86 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of the one or more different segments of the Russell 1000(R) Growth Index. The particular segments of the Russell 1000(R) Growth Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The Russell 1000(R) Growth Index is an unmanaged, market cap-weighted index, which is reviewed and reconstituted each year. Further information about the Russell 1000(R) Growth Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the Russell 1000(R) Growth Index.

 

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The Small Capitalization Equity Portfolio:

1. The following replaces the “Investment Subadvisers” section on page 21 of the Prospectus:

Investment Subadvisers

Cupps Capital Management, LLC (“Cupps”), Frontier Capital Management Company, LLC (“Frontier”), IronBridge Capital Management LP (“IronBridge”), Pzena Investment Management, LLC (“Pzena”), SSgA FM, Mellon Capital and Ariel Investments, LLC (“Ariel”) are the Specialist Managers for the Portfolio.

Portfolio Managers:

Cupps: Andrew S. Cupps has managed the portfolio of the Portfolio allocated to Cupps since June, 2011.

Frontier: Michael Cavarretta has managed the portion of the Portfolio allocated to Frontier since September, 1995.

IronBridge: Christopher C. Faber and Jeffrey B. Madden have co-managed the portion of the Portfolio allocated to IronBridge since November, 2004, and Thomas W. Fanter has co-managed the portion of the Portfolio allocated to IronBridge since November 2011.

Pzena: Richard Pzena, Benjamin Silver and John Flynn have co-managed the portion of the Portfolio allocation to Pzena since April, 2010.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed the portion of the Portfolio allocated to SSgA FM since July, 2012 and July, 2009 respectively.

Mellon Capital. Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

Ariel. David M. Maley and Kenneth E. Kuhrt have co-managed the portion of the Portfolio allocated to Ariel since [August,] 2013.

2. The following replaces the “Specialist Managers.” section on page 87 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Cupps Capital Management, LLC (“Cupps”), Frontier Capital Management Company, LLC (“Frontier”), IronBridge Capital Management LP (“IronBridge”) Pzena Investment Management, LLC (“Pzena”), and Ariel Investments, LLC (“Ariel”), are currently responsible for implementing the active component of the Portfolio’s investment strategy. The remaining portion of the Portfolio is managed using “passive” or “index” investment approaches that are is designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component of the Portfolio’s investment strategy. Further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated among them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is is added to the Section “More Information About Fund Investments and Risks—The Small Capitalization Equity Portfolio” on page 87:

The Ariel Investment Selection Process: Ariel uses independent thought and research to implement a four-part process. They screen more than 10,000 securities on size, valuation and industry parameters to yield roughly 2,000 issues. Of those they follow approximately 75 closely. They then determine whether or not an idea is cheap enough via a deep value strategy focusing on book value (often 1x or below), tangible book value, cash and other similar factors. There are no rigid criteria to their analytical

 

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process; they are trying to determine that a margin of safety exists between price and intrinsic value. They surround companies to paint a long-term picture and identify what others are missing. One key tool is their independent verification network of outside experts. Another tool is deciding the best methodology to determine whether a margin of safety exists. Once they have measured the gap between stock price and intrinsic value, they hold an informal discussion with any research members who are experts in the industry. The lead portfolio manager makes the final decision on whether or not to initiate a position. As natural contrarians, they sell a security when they believe that the valuation is no longer attractive due to assets and/or ability to generate profits and/or free cash flow. In keeping with their long-term patient approach, they will not sell a security because of a short-term disappointment. They will, however, sell a security if their investment thesis has changed, namely by a major shift in the competitive landscape, a deterioration in company fundamentals, and/or a loss of faith in management to execute the stated goals and objectives. The decision to sell is ultimately made by the lead portfolio manager.

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the Russell 2000(R) small capitalization universe (i.e. small capitalization value and small capitalization growth segments). The particular segments of the Russell 2000(R) universe that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The Russell 2000(R) Indices are unmanaged, market cap-weighted indices, which are reviewed and reconstituted each year. Further information about the Russell 2000(R) Indices appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the Russell 2000(R) Indices.

The Institutional Small Capitalization Equity Portfolio

1. The following replaces the “Investment Subadvisers” section on page 25 of the Prospectus:

Investment Subadvisers

Cupps Capital Management, LLC (“Cupps”), Frontier Capital Management Company, LLC (“Frontier”), IronBridge Capital Management LP (“IronBridge”), Pzena Investment Management, LLC (“Pzena”), SSgA FM, Mellon Capital and Ariel Investments, LLC (“Ariel”) are the Specialist Managers for the Portfolio.

Portfolio Managers:

Cupps: Andrew S. Cupps has managed the portion of the Portfolio allocated to Cupps since June, 2011.

Frontier: Michael Cavarretta has managed the portion of the Portfolio allocated to Frontier since the Portfolio’s August, 2008.

IronBridge: Christopher C. Faber and Jeffrey B. Madden have co-managed the portion of the Portfolio allocated to IronBridge since August, 2008, and Thomas W. Fanter has co-managed the portion of the Portfolio allocated to IronBridge since November 2011.

Pzena: Richard Pzena, Benjamin Silver and John Flynn have co-managed the portion of the Portfolio allocation to Pzena since April, 2010.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed the portion of the Portfolio allocated to SSgA FM since July, 2012 and July, 2009 respectively.

Mellon Capital. Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

Ariel. David M. Maley and Kenneth E. Kuhrt have co-managed the portion of the Portfolio allocated to Ariel since [August,] 2013.

 

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2. The following replaces the “Specialist Managers.” section on pages 88 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Cupps Capital Management, LLC (“Cupps”), Frontier Capital Management Company, LLC (“Frontier”), IronBridge Capital Management LP (“IronBridge”), Pzena Investment Management, LLC (“Pzena”), and Ariel Investments, LLC (“Ariel”) are currently responsible for implementing the active component of the Portfolio’s investment strategy. The remaining portion of the Portfolio is managed using “passive” or “index” investment approaches that are designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component of the Portfolio’s investment strategy. Further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated among them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The Institutional Small Capitalization Equity Portfolio” on page 89:

The Ariel Investment Selection Process: Ariel uses independent thought and research to implement a four-part process. They screen more than 10,000 securities on size, valuation and industry parameters to yield roughly 2,000 issues. Of those they follow approximately 75 closely. They then determine whether or not an idea is cheap enough via a deep value strategy focusing on book value (often 1x or below), tangible book value, cash and other similar factors. There are no rigid criteria to their analytical process; they are trying to determine that a margin of safety exists between price and intrinsic value. They surround companies to paint a long-term picture and identify what others are missing. One key tool is their independent verification network of outside experts. Another tool is deciding the best methodology to determine whether a margin of safety exists. Once they have measured the gap between stock price and intrinsic value, they hold an informal discussion with any research members who are experts in the industry. The lead portfolio manager makes the final decision on whether or not to initiate a position. As natural contrarians, they sell a security when they believe that the valuation is no longer attractive due to assets and/or ability to generate profits and/or free cash flow. In keeping with their long-term patient approach, they will not sell a security because of a short-term disappointment. They will, however, sell a security if their investment thesis has changed, namely by a major shift in the competitive landscape, a deterioration in company fundamentals, and/or a loss of faith in management to execute the stated goals and objectives. The decision to sell is ultimately made by the lead portfolio manager.

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the Russell 2000(R) small capitalization universe (i.e. small capitalization value and small capitalization growth segments). The particular segments of the Russell 2000(R) universe that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The Russell 2000(R) Indices are unmanaged, market cap-weighted indices, which are reviewed and reconstituted each year. Further information about the Russell 2000(R) Indices appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the Russell 2000(R) Indices.

The Real Estate Securities Portfolio

1. The following replaces the “Investment Subadvisers” section on page 30 of the Prospectus:

Investment Subadviser

Wellington Management Company, LLP (“Wellington Management”), SSgA FM and Mellon Capital are the Specialist Managers for the Portfolio.

Portfolio Manager:

Wellington Management: Bradford D. Stoesser has managed the Portfolio since September, 2010.

 

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SSgA FM: John Tucker, CFA and Michael Feehily, CFA have not yet begun providing portfolio management services to the Portfolio.

Mellon Capital. Karen Wong, Warren Chiang, Peter Goslin and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

2. The following replaces the “Specialist Managers.” section on page 90 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Wellington Management Company, LLP (“Wellington Management”) is currently responsible for implementing the active component of the Portfolio’s investment strategy. The remaining portion of the Portfolio is managed using “passive” or “index” investment approaches that are designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component of the Portfolio’s investment strategy. Further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated among them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The Real Estate Securities Portfolio” on page 90 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the Dow Jones US Select REIT Index and FTSE EPRA/NAREIT. The particular segments of these indices that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The Dow Jones US Select REIT Index is designed to provide a measure of real estate securities that serve as proxies for direct real estate investing, in part by excluding securities whose value is not always closely tied to the value of the underlying real estate. The Index is a market capitalization weighted index of publicly traded REITs and is comprised of companies whose charters are the equity ownership and operation of commercial real estate and which operate under the REIT Act of 1960. The FTSE EPRA/NAREIT Global Real Estate Index Series is designed to represent general trends in eligible listed real estate stocks worldwide. Relevant real estate activities are defined as the ownership, trading and development of income-producing real estate. Further information about the Dow Jones US Select REIT Index and FTSE EPRA/NAREIT appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Fund’s returns may vary from the returns of the Dow Jones US Select REIT Index and FTSE EPRA/NAREIT.

The Commodity Returns Strategy Portfolio

1. The following replaces the “Investment Subadvisers” section on page 35 of the Prospectus:

Investment Subadviser

Wellington Management, PIMCO, SSgA FM and Mellon Capital are the Specialist Managers for the Portfolio.

Portfolio Managers:

Wellington Management: Jay Bhutani has managed a portion of the Portfolio allocated to Wellington Management since June, 2010. David Chang and Gregory LeBlanc have managed a portion of the Portfolio allocated to Wellington Management since April 2011.

PIMCO: Nicholas Johnson has managed the portion of the Portfolio allocated to PIMCO since June, 2010.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have not yet begun providing portfolio management services to the Portfolio.

 

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Mellon Capital. Karen Wong, Warren Chiang, Peter Goslin and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

2. The following replaces the “Specialist Managers.” section on page 92 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Wellington Management and PIMCO are currently responsible for implementing the active component of the Portfolio’s investment strategy. The remaining portion of the Portfolio is managed using “passive” or “index” investment approaches that are designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component of the Portfolio’s investment strategy. Further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated among them appears in the “Specialist Manager Guide” included later in this Prospectus

3. The following is added to the Section “More Information About Fund Investments and Risks—The Commodity Returns Strategy Portfolio” on page 92 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the MSCI ACWI Natural Resources Index. The particular segments of the MSCI ACWI Natural Resources Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The MSCI ACWI Natural Resources Index is comprised of large publicly traded companies, based on market capitalization, in global natural resources and commodities businesses that meet certain investability requirements. Further information about the MSCI ACWI Natural Resources Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the MSCI ACWI Natural Resources Index.

The International Equity Portfolio:

1. The following replaces the “Investment Subadvisers” section on page 39 of the Prospectus:

Investment Subadvisers

Artisan Partners Limited Partnership (“Artisan”), Capital Guardian Trust Company (“CapGuardian”), Causeway Capital Management LLC (“Causeway”), SSgA FM and Mellon Capital are the Specialist Managers for the Portfolio.

Portfolio Managers:

Artisan: Mark L. Yockey has managed the portion of the Portfolio allocated to Artisan since July, 1999. Andrew J. Euretig and Charles Hamker have served as Associate Portfolio Managers to the portion of the Portfolio allocated to Artisan since February, 2012.

CapGuardian: Gerald Du Manoir and David I. Fisher have co-managed the portion of the Portfolio allocated to CapGuardian since August, 2006 and May, 2005, respectively. Nancy J. Kyle, Lionel M. Sauvage and Rudolf M. Staehelin have co-managed the portion of the Portfolio allocated to CapGuardian since May, 2000. Philip Winston has co-managed the portion of the Portfolio allocated to CapGuardian since November, 2010.

Causeway: Sarah H. Ketterer, Harry W. Hartford, James A. Doyle, Jonathan P. Eng and Kevin Durkin have co-managed that portion of the Portfolio allocated to Causeway since December, 2006 and Conor Muldoon has co-managed that portion of the Portfolio allocated to Causeway since September, 2010.

 

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SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed that portion of the Portfolio allocated to SSgA FM since July, 2012.

Mellon Capital. Karen Wong, Warren Chiang, Peter Goslin and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

2. The following replaces the “Specialist Managers.” section on page 94 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Capital Guardian Trust Company (“CapGuardian”), Artisan Partners Limited Partnership (“Artisan”) and Causeway Capital Management LLC (“Causeway”) are currently responsible for implementing the active component of the Portfolio’s investment strategy. Additionally, a portion of the Portfolio may be managed using “passive” or “index” investment approaches designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component for the Portfolio’s investment strategy. The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The International Equity Portfolio” on page 94 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the MSCI EAFE Index. The particular segments of the MSCI EAFE Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The MSCI EAFE Index is a free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. and Canada. Further information about the MSCI EAFE Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the MSCI EAFE Index.

The Institutional International Equity Portfolio

1. The following replaces the “Investment Subadvisers” section on page 43 of the Prospectus:

Investment Subadvisers

Artisan Partners Limited Partnership (“Artisan”), Capital Guardian Trust Company (“CapGuardian”), Causeway Capital Management LLC (“Causeway”), Lazard Asset Management LLC (“Lazard”), SSgA FM and Mellon Capital are the Specialist Managers for the Portfolio.

Portfolio Managers:

Artisan: Mark L. Yockey has managed the portion of the Portfolio allocated to Artisan since November, 2009. Andrew J. Euretig and Charles Hamker have managed the portion of the Portfolio allocated to Artisan since February, 2012.

CapGuardian: Gerald Du Manoir, David I. Fisher, Nancy J. Kyle, Lionel M. Sauvage and Rudolf M. Staehelin have co-managed the portion of the Portfolio allocated to CapGuardian since November, 2009 and Philip Winston has co-managed the portion of the Portfolio allocated to CapGuardian since November, 2010.

 

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Causeway: Sarah H. Ketterer, Harry W. Hartford, James A. Doyle, Jonathan P. Eng and Kevin Durkin have co-managed that portion of the Portfolio allocated to Causeway since November, 2009 and Conor Muldoon has co-managed that portion of the Portfolio allocated to Causeway since September, 2010.

Lazard: Paul Moghtader, Taras Ivanenko, Alex Lai and Craig Scholl have co-managed the portion of the Portfolio allocated to Lazard since September, 2011.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed that portion of the Portfolio allocated to SSgA FM since July, 2012.

Mellon Capital. Karen Wong, Warren Chiang, Peter Goslin and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

2. The following replaces the “Specialist Managers.” section on page 95 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Capital Guardian Trust Company (“CapGuardian”), Artisan Partners Limited Partnership (“Artisan”) and Causeway Capital Management LLC (“Causeway”) and Lazard Asset Management LLC (“Lazard”) are currently responsible for implementing the active component of the Portfolio’s investment strategy. Additionally, a portion of the Portfolio may be managed using “passive” or “index” investment approaches designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component for the Portfolio’s investment strategy. The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The Institutional International Equity Portfolio” on page 96 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the MSCI EAFE Index. The particular segments of the MSCI EAFE Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The MSCI EAFE Index is a free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. and Canada. Further information about the MSCI EAFE Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the MSCI EAFE Index.

The Emerging Markets Portfolio

1. The following replaces the “Investment Subadvisers” section on page 47 of the Prospectus:

Investment Subadvisers

The Boston Company Asset Management LLC (“TBCAM”), SSgA FM and Mellon Capital are the Specialist Managers for the Portfolio.

Portfolio Managers:

TBCAM: Kirk Henry, CFA and Warren Skillman have co-managed the active investment strategy portion of the Portfolio allocated to TBCAM since March, 2010.

 

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SSgA FM: Christopher Laine, Michael Ho, Ph.D and Jean-Christophe de Beaulieu, CFA have managed the active investment strategy portion of the Portfolio allocated to SSgA FM since April, 2010, July, 2012, and July, 2012 respectively.

Michael Feehily, CFA and John Tucker, CFA have co-managed the passive investment strategy portion to the Portfolio allocated to SSgA FM since July, 2012.

Mellon Capital. Karen Wong, Warren Chiang, Peter Goslin and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

2. The following replaces the “Specialist Managers.” section on pages 97 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. The Boston Company Asset Management LLC (“TBCAM”) and SSgA FM are currently responsible for implementing the active component of the Portfolio’s investment strategy. Mellon Capital and SSgA FM also manage a portion of the Portfolio that may be managed using a “passive” or “index” investment approach designed to replicate the composition of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The Emerging Markets Portfolio” on page 98 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the MSCI EM Index. The particular segments of the MSCI EM Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The MSCI EM Index is an unmanaged free float-adjusted market capitalization index that is designed to measure equity market performance of emerging markets. Further information about the MSCI EM Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Fund’s returns may vary from the returns of the MSCI EM Index.

The Small Capitalization Equity Portfolio and The Institutional Small Capitalization Equity Portfolio:

1. The following is inserted in the “Specialist Manager Guide” just after the “Alliance Bernstein L.P.” section on page 127:

Ariel Investments, LLC (“Ariel”) serves as a Specialist Manager for The Small Capitalization Equity Portfolio and The International Small Capitalization Equity Portfolio. Ariel is an investment adviser registered with the Securities and Exchange Commission pursuant to the Investment Advisers Act. Its headquarters are located at 200 East Randolph Street, Suite 2900, Chicago, IL 60601. As of March 31, 2013, Ariel had approximately $6 billion in assets under management.

For its services to The Small Capitalization Equity Portfolio and The Institutional Small Capitalization Equity Portfolio, Ariel will be paid an annual fee, calculated daily and payable quarterly, in arrears, based on the Combined Assets (i.e., the aggregate of the assets of the each Small Cap Portfolio allocated to Ariel and certain other investment advisory accounts at the Adviser or its affiliates for which Ariel provides similar services), in accordance with the following schedule: 1.00% of the first $10 million of the Combined Assets, 0.75% of the next $10 million and 0.50% of Combined Assets exceeding $20 million.

David M. Maley and Kenneth E. Kuhrt will be primarily responsible for the day-to-day management of that portion of the Small Cap Portfolios’ assets allocated to Ariel. Mr. Maley is the firm’s Lead Portfolio Manager for its micro and small cap deep value strategies. He has been with Ariel since 2009 and has previously served as a Vice President at Goldman Sachs, Vice President and Senior Portfolio Manager at Harris Bank and President at Maple Hill Capital Management. Mr. Kuhrt, a Portfolio Manager, is a Certified Public Accountant and has been with the firm since 2004. Prior to joining Ariel, Mr. Kuhrt was a Senior Investment Banking Analyst at William Blair & Co, LLC and a Senior Auditor at KPMG, LLP.

 

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The Value Equity Portfolio, The Institutional Value Equity Portfolio, The Growth Equity Portfolio, The Institutional Growth Equity Portfolio, The Small Capitalization Equity Portfolio, The Institutional Small Capitalization Equity Portfolio, The Real Estate Securities Portfolio, The Commodity Returns Strategy Portfolio, The International Equity Portfolio, The Institutional International Equity Portfolio and The Emerging Markets Portfolio:

1. The following replaces the “Mellon Capital Management Corporation” section of the “Specialist Manager Guide” on page 134:

Mellon Capital Management Corporation (“Mellon Capital”) serves as a Specialist Manager for The Value Equity Portfolio, The Institutional Value Equity Portfolio, The Growth Equity Portfolio, The Institutional Growth Equity Portfolio, The Small Capitalization Equity Portfolio, The Institutional Small Capitalization Equity Portfolio, The Real Estate Securities Portfolio, The Commodity Returns Strategy Portfolio, The International Equity Portfolio, The Institutional International Equity Portfolio and The Emerging Markets Portfolio. Mellon Capital, which was organized as a Delaware corporation in 1983, is headquartered at 50 Fremont Street, Suite 3900, San Francisco, CA 94105. Mellon Capital is a wholly-owned indirect subsidiary of The Bank of New York Mellon Corporation (“BNY Mellon”).

For its services to The Value Equity Portfolio, The Institutional Value Equity Portfolio, The Growth Equity Portfolio, The Institutional Growth Equity Portfolio, The Small Capitalization Equity Portfolio, The Institutional Small Capitalization Equity Portfolio, The Real Estate Securities Portfolio, The Commodity Returns Strategy Portfolio, The International Equity Portfolio, The Institutional International Equity Portfolio and The Emerging Markets Portfolio (the “Equity Portfolios”), Mellon Capital receives fees for each of the Equity Portfolios, calculated based on an annual percentage of average daily net assets. Mellon Capital’s fees would be paid at one level so long as the aggregate assets allocated to Mellon Capital for all of its passive equity mandates (including accounts for other clients of the Adviser and its affiliates besides the Trust) exceed $2 billion. Should these aggregate assets fall below $2 billion, a higher fee will apply. The initial allocation to Mellon Capital is expected to exceed $4.5 billion.

 

     Fee When
Aggregate
Assets Are
Greater Than
$2 Billion
    Fee When
Aggregate
Assets Are
Less Than $2
Billion
 

The Value Equity Portfolio:

     0.065     0.075

The Institutional Value Equity Portfolio:

     0.065     0.075

The Growth Equity Portfolio:

     0.065     0.075

The Institutional Growth Equity Portfolio:

     0.065     0.075

The Small Capitalization Equity Portfolio:

     0.065     0.075

The Institutional Small Capitalization Equity Portfolio:

     0.065     0.075

The Real Estate Securities Portfolio:

     0.10     0.11

The Commodity Returns Strategy Portfolio:

     0.10     0.11

The International Equity Portfolio:

     0.10%/0.13 %*      0.11%/0.15 %* 

The Institutional International Equity Portfolio:

     0.10%/0.13 %*      0.11%/0.15 %* 

The Emerging Markets Portfolio:

     0.13     0.15

 

* Mellon Capital manages two different strategies, under separate Portfolio Management Agreements, in each of the International Equity and Institutional International Equity Portfolios: a developed markets strategy with a fee of 0.10% or 0.11% (based on asset levels as described above) and an emerging markets strategy with a fee of 0.13% or 0.15%.

 

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For its services to The Core Fixed Income Portfolio and The U.S. Government Fixed Income Securities Portfolio, Mellon Capital receives a fee, based on the average daily net asset value of that portion of the assets of the Portfolios managed by it, at an annual rate of 0.06%. During the fiscal year ended June 30, 2013 Mellon received fees of [    ] % of the average daily net assets for each portion of The Core Fixed Income Portfolio and The U.S. Government Fixed Income Securities Portfolio allocated to Mellon.

The Portfolio Managers for the Value Equity, Institutional Value Equity, Growth Equity, Institutional Growth Equity, Small Capitalization Equity and Institutional Small Capitalization Equity Portfolios are Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford. The Portfolio Managers for the Real Estate Securities, Commodity Returns Strategy, International Equity, Institutional International Equity and Emerging Markets Portfolios are Karen Wong, Warren Chiang, Peter Goslin and Kristin Crawford.

Karen Q. Wong, CFA is a Managing Director and Head of Equity Portfolio Management at Mellon Capital.

Warren Chiang, CFA is a Managing Director and Head of Active Equity Strategies at Mellon Capital. He has an M.B.A. and a B. S. from the University of California at Berkeley. Mr. Chiang has 16 years of investment experience and tenure at Mellon Capital. Mr. Chiang manages the entire team of portfolio managers and researchers for all U.S. and international active equity strategies. He is responsible for the refinement and implementation of the active equity portfolio management process.

Ronald Gala, CFA is a Director, Team Leader and Senior Portfolio Manager for the Active Equity Strategies. Mr. Gala has 27 years of investment experience with tenure of 20 years between Mellon Capital and Mellon Equity Associates, LLP. He is a member and past president of the CFA Society of Pittsburgh and a member of the CFA Institute. He has an M.B.A. from the University of Pittsburgh and a B.S. from Duquesne University.

Kristin Crawford is a Vice President and Senior Portfolio Manager for the Active Equity Strategies. Ms. Crawford has 19 years of investment experience with tenure of 13 years between Mellon Capital and Franklin Portfolio Associates. She has an M.B.A. from Suffolk University and a B.S. from Smith College. Prior to joining Mellon Capital, she was a vice president and portfolio manager at Franklin Portfolio Associates.

Peter Goslin, CFA is a Vice President and Senior Portfolio Manager for the Active Equity Strategies. Mr. Goslin has 20 years of investment experience with tenure of 14 years at Mellon Capital. Mr. Goslin has an M.B.A. from the University of Notre Dame in Finance. Prior to joining Mellon Capital, Mr. Goslin was a derivatives trader and NASDAQ market maker for Merrill Lynch and ran Merrill’s Equity Index Option desk at the Chicago Mercantile Exchange.

Day-to-day investment decisions for the portions of The Core Fixed Income Portfolio and The U.S. Government Fixed Income Securities Portfolio allocated to Mellon Capital are the responsibility of David C. Kwan, CFA Ms. Zandra Zelaya, CFA, and Mr. Lowell J. Bennett, CFA. Mr. Kwan is a Managing Director, Fixed Income Management of Mellon Capital with 22 years of investment experience at the firm. He earned both a B.S. and an M.B.A. at the University of California at Berkeley. Ms. Zelaya is a Director of Fixed Income Management of Mellon Capital with 17 years of investment experience and 15 years at the firm. She earned a B.S. at California State University at Haward. Mr. Bennett is a Managing Director, Investment Strategist at Mellon Capital with 25 years of finance and investment experience and 15 years at the firm. He earned both a B.S.I.E and M.B.A. from Stanford University.

As of June 30, 2013, Mellon Capital had assets under management totaling approximately $313 billion, which includes overlay strategies.

The Value Equity Portfolio, The Institutional Value Equity Portfolio, The Growth Equity Portfolio, The Institutional Growth Equity Portfolio, The Small Capitalization Equity Portfolio, The Institutional Small Capitalization Equity Portfolio, The Real Estate Securities Portfolio, The Commodity Returns Strategy Portfolio, The International Equity Portfolio, The Institutional International Equity Portfolio, The Emerging Markets Portfolio, The Core Fixed Income Portfolio, The Fixed Income Opportunity Portfolio, The U.S. Government Fixed Income Securities Portfolio, The U.S. Corporate Fixed Income Securities Portfolio, The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio, The Short-Term Municipal Bond Portfolio, The Intermediate Term Municipal Bond Portfolio and The Intermediate Term Municipal Bond II Portfolio: (From the Supplement filed on June 28, 2013)

 

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1. The following replaces the second paragraph under the “Calculating NAV” section of “Shareholder Information” on page 117 of the Prospectus:

The value of each Portfolio’s investments is generally determined by current market quotations. When reliable market quotations are not readily available for any security, the fair value of that security will be determined by a committee established by the Trust’s Board of Trustees (“Board”) in accordance with procedures adopted by the Board. The fair valuation process is designed to value the subject security at the price a Portfolio would reasonably expect to receive upon its current sale. Fair value pricing may be employed, for example, if the value of a security held by a Portfolio has been materially affected by an event that occurs after the close of the market in which the security is traded, in the event of a trading halt in a security for which market quotations are normally available or with respect to securities that are deemed illiquid. When this fair value pricing method is employed, the prices of securities used in the daily computation of a Portfolio’s NAV per share may differ from quoted or published prices for the same securities. Additionally, security valuations determined in accordance with the fair value pricing method may not fluctuate on a daily basis, as would likely occur in the case of securities for which market quotations are readily available. Consequently, changes in the fair valuation of portfolio securities may be less frequent and of greater magnitude than changes in the price of portfolio securities valued based on market quotations.

The Fixed Income Opportunity Portfolio: (From the Supplement filed on June 28, 2013)

1. The following replaces the “Investment Adviser” and “Investment Subadvisor” sections on page 56 of the Prospectus:

Investment Adviser

HC Capital Solutions is the Portfolio’s investment adviser with responsibility for the management of the Portfolio’s assets, including all investments in other investment companies.

Portfolio Manager:

Thomas Cowhey, CFA has managed the Portfolio since June, 2013.

Investment Subadvisor

Seix, Fort Washington Investment Advisors, Inc. (“Fort Washington”) and PIMCO are the Specialist Managers for the Portfolio with responsibility for the management of the Portfolio’s assets that are invested directly in fixed income securities.

Portfolio Managers:

Fort Washington: Brendan White and Timothy Jossart have co-managed the portion of the Portfolio allocated to Fort Washington since May, 2012.

PIMCO: Curtis Mewbourne has managed the portion of the Portfolio allocated to PIMCO since January, 2010.

Seix: Michael Rieger, Michael Kirkpatrick and Brian Nold have managed that portion of the Portfolio allocated to Seix since November, 2007.

2. The following supplements the “Advisory Services – HC Capital Solutions” disclosure on page 114 of the Prospectus:

Mr. Thomas Cowhey, CFA acts as a portfolio manager for the Real Estate Securities and Fixed Income Opportunity Portfolios. Mr. Cowhey is the Chief Investment Strategist for the Advisor and has been with the Advisor since 2000.

The Real Estate Securities Portfolio: (From the Supplement filed on June 10, 2013) Effective immediately, The Real Estate Securities Portfolio is closed to new investors.

The Commodity Returns Strategy Portfolio: (From the Supplement filed on June 10, 2013) Effective June 10, 2013, The Commodity Returns Strategy Portfolio’s classification changed from non-diversified to diversified. All references to the Portfolio are changed accordingly.

 

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International Equity Portfolio and Institutional International Equity Portfolio: (From the Supplement filed on June 10, 2013)

1. The following replaces the first paragraph under the “Artisan Partners Limited Partnership” section of the “Specialist Manager Guide” on page 127 of the Prospectus:

Artisan Partners Limited Partnership (“Artisan”) serves as a Specialist Manager for The International Equity and The Institutional International Equity Portfolios. Artisan, the principal office of which is located at 875 E. Wisconsin Avenue, Suite 800, Milwaukee, WI 53202, has provided investment management services for international equity assets since 1995. As of June 30, 2012, Artisan managed total assets in excess of $64 billion, of which approximately $37 billion consisted of mutual fund assets. Artisan Partners is a limited partnership organized under the laws of Delaware. Artisan Partners is managed by its general partner, Artisan Investments GP LLC, a Delaware limited liability company wholly-owned by Artisan Partners Holdings LP (Artisan Partners Holdings). Artisan Partners Holdings is a limited partnership organized under the laws of Delaware whose sole general partner is Artisan Partners Asset Management Inc., a Delaware Corporation. Artisan Partners was founded in March 2009 and succeeded to the investment management business of Artisan Partners Holdings during 2009. Artisan Partners Holdings was founded in December 1994 and began providing investment management services in March 1995.

The International Equity Portfolio: (From the Supplement filed on April 25, 2013)

 

1. The following replaces the section of the Prospectus pertaining to Causeway Capital Management LLC under the “Portfolio Managers” section on page 39 of the Prospectus:

Causeway: Sarah H. Ketterer, Harry W. Hartford, James A. Doyle, Jonathan P. Eng and Kevin Durkin have co-managed that portion of the Portfolio allocated to Causeway since December, 2006 and Conor Muldoon has co-managed that portion of the Portfolio allocated to Causeway since September, 2010. Foster Corwith and Alessandro Valentini have co-managed the portion of the Portfolio allocated to Causeway since April 2013.

The Institutional International Equity Portfolio: (From the Supplement filed on April 25, 2013)

 

1. The following replaces the section of the Prospectus pertaining to Causeway Capital Management LLC under the “Portfolio Managers” section on page 43 of the Prospectus:

Causeway: Sarah H. Ketterer, Harry W. Hartford, James A. Doyle, Jonathan P. Eng and Kevin Durkin have co-managed that portion of the Portfolio allocated to Causeway since November, 2009 and Conor Muldoon has co-managed that portion of the Portfolio allocated to Causeway since September, 2010. Foster Corwith and Alessandro Valentini have co-managed the portion of the Portfolio allocated to Causeway since April 2013.

The International Equity Portfolio and The Institutional International Equity Portfolio: (From the Supplement filed on April 25, 2013)

1. The following replaces the third paragraph under the “Causeway Capital Management LLC” section of the “Specialist Manager Guide” on page 130 of the Prospectus:

Day-to-day management of those assets of The International Equity and Institutional International Equity Portfolios allocated to Causeway is the responsibility of Sarah H. Ketterer, Harry W. Hartford, James A. Doyle, Jonathan P. Eng, Kevin Durkin, Conor Muldoon, Foster Corwith and Alessando Valentini. Ms. Ketterer, Mr. Hartford, Mr. Doyle, Mr. Eng, and Mr. Durkin have been investment professionals with Causeway since 2001, Mr. Muldoon has been an investment professional with Causeway since 2003 and Messrs Corwith and Valentini have been investment professionals with the firm since 2006. Ms. Ketterer and Mr. Hartford were co-founders of Causeway in 2001, and serve as the firm’s chief executive officer and president, respectively. Ms. Ketterer and Mr. Hartford previously served as co-heads of the International and Global Value Equity Team of the Hotchkis and Wiley division of Merrill Lynch Investment Managers, L.P. (“Hotchkis and Wiley”). Messrs. Doyle, Eng, and Durkin, directors of Causeway, were also associated with the Hotchkis and Wiley International and Global Value Equity Team prior to joining Causeway in 2001. Mr. Muldoon, a director of Causeway, previously served as an investment consultant for Fidelity Investments as a liaison between institutional clients and investment managers within Fidelity. Mr. Corwith, a director and fundamental portfolio manager, previously served as a research associate at Deutsche Asset Management where he was responsible for researching consumer staple companies. Mr. Valentini, a director and fundamental portfolio manager, previously worked at Thornburg Investment Management, where he conducted fundamental research focusing on the European telecommunication and Canadian oil sectors.

The Real Estate Securities Portfolio: (From the Supplement filed on April 18, 2013)

Upon the recommendation of the Adviser, the Board of Trustees of HC Capital Trust has approved a modification of the Principal Investment Strategies of the Portfolio to allow the Portfolio to implement its real estate securities strategies by investing primarily in shares of other real estate-oriented investment companies, such as exchange-traded funds (“ETFs”). Accordingly, the following changes to the disclosure related to the Real Estate Securities Portfolio are effective April 26, 2013:

 

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1. The following replaces the “Fees and Expenses” section on page 26 of the Prospectus:

Fees and Expenses

The fee tables below describe the fees and expenses that you may pay if you buy and hold HC Strategic Shares of the Portfolio.

Shareholder Fees

(fees paid directly from your investment)

 

Maximum Sales Charges

     None   

Maximum Redemption Fee

     None   

Annual Operating Expenses

(expenses that you pay each year as a percentage of the value of your investment)

 

Management Fees (based on asset allocations among Specialist Managers, see “Advisory Services – Specialist Managers”)

     0.05

Other Expenses

     0.08

Acquired Fund Fees and Expense

     0.18

Total Annual Portfolio Operating Expenses

     0.31

Example: This Example is intended to help you compare the cost of investing in the Portfolio with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Portfolio for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Portfolio’s operating expenses remain the same. Although your actual cost may be higher or lower, based on these assumptions, your costs would be:

 

1 Year

   $ 32   

3 Years

   $ 100   

5 Years

   $ 174   

10 Years

   $ 393   

2. The following supplements the “Principal Investment Strategies” disclosure on page 26 of the Prospectus:

The Portfolio may implement its principal investment strategy by investing up to 100% of its assets in exchange-traded funds, that themselves invest in real estate-related securities.

3. The following supplements the “Principal Investment Risks” disclosure on page 27 of the Prospectus:

 

 

Investment in Other Investment Companies Risk – As with other investments, investments in other investment companies are subject to market and selection risk. In addition, if the Fund acquires shares of investment companies, shareholders bear both their proportionate share of expenses in the Fund (including management and advisory fees) and, indirectly, the expenses of the other investment companies.

 

 

Exchange-Traded Funds Risk – An investment by the Portfolio in ETFs generally presents the same primary risks as an investment in other investment companies. In addition, an ETF may be subject to the following: (1) a discount of the ETF’s shares to its net asset value; (2) failure to develop or maintain an active trading market for the ETF’s shares; (3) the listing exchange halting trading of the ETF’s shares; (4) failure of the ETF’s shares to track the referenced asset; and (5) holding troubled securities in the referenced index or basket of investments.

4. The following replaces the “Investment Adviser” and “Investment Subadvisor” sections on page 30 of the Prospectus:

Investment Adviser

HC Capital Solutions is the Portfolio’s investment adviser with responsibility for the management of the Portfolio’s assets, including all investments in other investment companies.

 

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Portfolio Manager:

Thomas Cowhey, CFA has managed the Portfolio since April, 2013.

Investment Subadvisor

Wellington Management Company LLP (“Wellington Management”) and SSgA FM are the Specialist Managers for the Portfolio with responsibility for the management of the Portfolio’s assets that are invested directly in real estate securities.

Wellington Management: Bradford D. Stoesser has managed the Portfolio since September, 2010.

SSgA FM: John Tucker, CFA and Michael Feehily, CFA have not yet begun providing portfolio management services to the Portfolio.

5. The following supplements the “More Information About Fund Investments and Risks” disclosure related to the Real Estate Securities Portfolio on page 90 of the Prospectus:

The Portfolio may implement its investment strategy by investing in exchange traded investment companies, known as “ETFs,” that themselves invest in the equity and debt securities issued by real estate-related companies including real estate investment trusts (REITs). For more information on ETFs, see “Investments in Other Investment Companies” on page 113 of this Prospectus.

6. The following supplements the “Investments in Other Investment Companies” disclosure on page 113 of the Prospectus:

Additionally, the Real Estate Securities Portfolio may invest up to 100% of its assets in ETFs that invest in the securities of real estate related companies in reliance on provisions of the Investment Company Act that permit such investments so long as the investing fund, together with any affiliates, does not own more than 3% of the outstanding voting securities of the acquired fund. Under these provisions, the Real Estate Securities Portfolio is required to vote all proxies of the funds it owns in the same proportion as the vote of all other holders of such securities.

7. The following supplements the “Advisory Services – HC Capital Solutions” disclosure on page 114 of the Prospectus:

Mr. Thomas Cowhey, CFA acts as a portfolio manager for the Real Estate Securities Portfolio. Mr. Cowhey is the Chief Investment Strategist for the Advisor and has been with the Advisor since 2000.

The Short-Term Municipal Bond Portfolio: (From the Supplement filed on April 18, 2013)

 

  2. The following replaces the section of the Prospectus under the “Portfolio Managers” section on page 72 of the Prospectus:

Breckinridge: Peter Coffin, David Madigan, and Martha Field Hodgman have co-managed the Portfolio since March, 2006. Susan Mooney and Matthew Buscone have co-managed the Portfolio since February, 2007 and July, 2008, respectively. Ji Young has managed the Portfolio since March 2013.

The Intermediate Term Municipal Bond II Portfolio: (From the Supplement filed on April 18, 2013)

 

  1. The following replaces the section of the Prospectus under the “Portfolio Managers” section on page 80 of the Prospectus:

Breckinridge: Peter Coffin, David Madigan, Martha Field Hodgman, Susan Mooney and Matthew Buscone have co-managed the Portfolio since March, 2010 and Ji Young has managed the Portfolio since March 2013.

 

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The Short-Term Municipal Bond Portfolio and The Intermediate Term Municipal Bond II Portfolio: (From the Supplement filed on April 18, 2013)

The following replaces the third and fourth paragraphs under the “Breckinridge Capital Advisors, Inc” section of the “Specialist Manager Guide” on page 129 of the Prospectus:

The portfolio management team is led by a team of investment professionals at Breckinridge, including the following individuals who are jointly and primarily responsible for making day-to-day investment decisions: Peter B. Coffin, President of Breckinridge since 1993, David Madigan, Chief Investment Officer at Breckinridge since 2003, Martha Field Hodgman, Executive Vice President at Breckinridge since 2001, Susan Mooney, Senior Vice President of Breckinridge since 2007, Matthew Buscone, Vice President, at Breckinridge since 2002 and Ji Young, Portfolio Manager since March 2012.

Prior to founding Breckinridge, Mr. Coffin was a Senior Vice-President and portfolio manager with Massachusetts Financial Services, where he was also a member of the firm’s Fixed Income Policy Committee. From 1996 to 2002, Mr. Madigan was Executive Vice-President at Thomson Financial. He has also served as a portfolio manager at Banker’s Trust and Prudential Insurance (managing single state municipal bond funds), as well as Chief Municipal Strategist for Merrill Lynch. From 1993 to 2001, Ms. Hodgman served as a Vice President in the Fixed Income Management Group of Loomis Sayles & Co. L.P. She has also been a portfolio manager for John Hancock Advisors, Inc. (managing state-specific tax exempt mutual funds) and an analyst for the Credit Policy Committee of Putnam Investments. From 2003-2007 Ms. Mooney was Director of Fixed Income and principal at Freedom Capital Management, LLC, where she managed institutional fixed income assets for pension funds, corporations and endowments. Prior to that position she was Managing Director at Harbor Capital. Mr. Buscone has been a Portfolio Manager since 2008 after having served as a trader at Breckinridge from 2002-2008. From 1992-2002 he was a Trader and Portfolio Manager for both taxable and tax-exempt portfolios at David L. Babson and Mellon Private Asset Management. Ms. Young joined Breckinridge in October 2008 as a member of the Credit Research Team and transitioned to Portfolio Management in March 2012. Prior to joining Breckinridge she was a credit analyst within the Public Finance Group at Assured Guaranty.

The Fixed Income Opportunity Portfolio: (From the Supplement filed on March 5, 2013) Effective immediately, Michael Rieger will no longer serve as a portfolio manager for The Fixed Income Opportunity Portfolio managed by Seix Investment Advisors, LLC (“Seix”).

 

  3. The following replaces the section of the Prospectus with respect to Seix under the “Portfolio Managers” section on page 56 of the Prospectus:

Seix: Michael Kirkpatrick and Brian Nold have managed the portion of the Portfolio allocated to Seix since November, 2007 and Vincent Flanagan has managed the Portfolio since February, 2013.

 

  4. The following replaces the third paragraph under “Seix Investment Advisors LLC” of the “Specialist Manager Guide” on page 135 of the Prospectus:

Day-to-day high yield investment decisions for The Fixed Income Opportunity Portfolio are the responsibility of Michael Kirkpatrick, Brian Nold and Vincent Flanagan. Michael Kirkpatrick, Senior Portfolio Manager and Senior High Yield Research Analyst, focuses principally on the Flagship High Yield Portfolios in addition to a High Yield Unconstrained strategy. Prior to joining Seix in 2002, Mr. Kirkpatrick was a Senior Analyst at Oppenheimer Funds, Inc. covering the Telecommunications and Cable industries. Mr. Nold, Senior Portfolio Manager and Senior High Yield Research Analyst, focuses on a High Yield Unconstrained strategy in addition to the Flagship High Yield Portfolios. Before joining Seix in 2003, he was a High Yield Analyst at Morgan Stanley in Global High Yield Research. Vincent Flanagan, Portfolio Manager and Senior High Yield Research Analyst, is primarily focused on bank loans. Prior to joining Seix in 2006, Mr. Flanagan was the director of research for Assurant, Inc.

The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio: (From the Supplement filed on March 5, 2013)

 

  1. The following supplements the “Portfolio Managers” section on page 68 of the Prospectus:

Mellon Capital: Mr. David C. Kwan, Ms. Zandra Zelaya, Mr. Lowell J. Bennett and Mr. Gregg Lee have co-managed the Portfolio since December, 2012.

The Core Fixed Income Portfolio: (From the Supplement filed on March 5, 2013)

 

  1. The following supplements the “Portfolio Managers” section on page 51 of the Prospectus:

Mellon Capital: Mr. David C. Kwan, Ms. Zandra Zelaya, and Mr. Lowell J. Bennett have co-managed the Portfolio since December, 2010 and Mr. Gregg Lee has managed the Portfolio since December, 2012.

 

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The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio and The Core Fixed Income Portfolio: (From the Supplement filed on March 5, 2013)

The following replaces the “Mellon Capital Management Corporation” section of the “Specialist Manager Guide” on page 134 of the Prospectus:

Mellon Capital Management Corporation (“Mellon Capital”) serves as a Specialist Manager for The Core Fixed Income Portfolio, The U.S. Government Fixed Income Securities Portfolio and The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio. Mellon Capital, which was organized as a Delaware corporation in 1983, is headquartered at 50 Fremont Street, Suite 3900, San Francisco, CA 94105. Mellon Capital is a wholly-owned indirect subsidiary of The Bank of New York Mellon Corporation (“BNY Mellon”).

For its services to The Core Fixed Income Portfolio and The U.S. Government Fixed Income Securities Portfolio, Mellon Capital receives a fee, based on the average daily net asset value of that portion of the assets of the Portfolios managed by it, at an annual rate of 0.12%. Effective September 1, 2012, Mellon Capital receives a fee, based on the average daily net asset value of that portion of the assets of the Portfolios managed by it, at an annual rate of 0.06%. For its services to The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio, Mellon Capital receives a fee based on the average daily net asset value of that portion of the assets of the Portfolio managed by it, at an annual rate of 0.06%. During the fiscal year ended June 30, 2012 Mellon received fees of 0.12% of the average daily net assets for each portion of The Core Fixed Income Portfolio and The U.S. Government Fixed Income Securities Portfolio allocated to Mellon.

Day-to-day investment decisions for the portions of The Core Fixed Income Portfolio, The U.S. Government Fixed Income Securities Portfolio and The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio allocated to Mellon Capital are the responsibility of David C. Kwan, CFA Ms. Zandra Zelaya, CFA, and Mr. Gregg Lee, CFA. Mr. Kwan is a Managing Director, Fixed Income Management of Mellon Capital with 22 years of investment experience at the firm. He earned both a B.S. and an M.B.A. at the University of California at Berkeley. Ms. Zelaya is a Director of Fixed Income Management of Mellon Capital with 17 years of investment experience and 15 years at the firm. She earned a B.S. at California State University at Haward. Mr. Gregg Lee is a Vice President, Senior Portfolio Manager at Mellon Capital with 23 years of investment experience and 23 year at the firm. He earned a B.S. at the University of California at Davis.

As of June 30, 2012, Mellon Capital had assets under management totaling approximately $240 billion, which includes overlay strategies.

The Core Fixed Income Portfolio and The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio: (From the Supplement filed on January 8, 2013) Effective January 8, 2013, the investment advisory relationship between the Trust and BlackRock Financial Management, Inc. (“BlackRock”) with respect to The Core Fixed Income Portfolio and The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio has been terminated. Any and all references to BlackRock are hereby removed.

The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio: (From the Supplement filed on December 11, 2012) At a meeting, held on December 4, 2012, the Board of Trustees (the “Board”) for HC Capital Trust (the “Trust”) approved the engagement of Mellon Capital Management Corporation (“Mellon Capital”) as an additional investment advisory organization (“Specialist Manager”) to manage a portion of the assets of The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio of the Trust.

1. The following replaces the “Annual Operating Expenses” section on page 65 of the Prospectus:

Annual Operating Expenses

(expenses that you pay each year as a percentage of the value of your investment)

 

Management Fees

     0.11

Other Expenses

     0.08

Total Annual Portfolio Operating Expenses

     0.19

Example: This Example is intended to help you compare the cost of investing in the Portfolio with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Portfolio for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Portfolio’s operating expenses remain the same. Although your actual cost may be higher or lower, based on these assumptions, your costs would be:

 

1 Year

   $ 19   

3 Years

   $ 61   

5 Years

   $ 107   

10 Years

   $ 243   

 

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2. The following supplements the “Principal Investment Risks” section on page 66 of the Prospectus:

 

 

Multi-Manager Risk – The risk that the Trust may be unable to (a) identify and retain Specialist Managers who achieve superior investment records relative to other similar investments, (b) pair Specialist Managers that have complementary investment styles, or (c) effectively allocate Portfolio assets among Specialist Managers to enhance the return and reduce the volatility that would typically be expected of any one management style. A multi-manager Portfolio may, under certain circumstances, incur trading costs that might not occur in a Portfolio that is served by a single Specialist Manager.

3. The following replaces the “Investment Subadvisers” section on page 68 of the Prospectus:

Blackrock and Mellon Capital are the Specialist Managers for the Portfolio.

4. The following supplements the “Specialist Managers” section under “The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio” on page 102 of the Prospectus:

 

The Mellon Capital Investment Selection Process    Mellon Capital employs a disciplined approach which seeks to gain exposure to securities and sectors like those contained in the Barclays Capital US Securitized Index. It begins by identifying and isolating the major components and sectors and assessing the key characteristics of the index. After analyzing these factors, Mellon Capital Management then invests in securities designed to gain exposure to these different sectors, and that have characteristics that are similar to those which are found in the index. In this process, they also focus on relative value and issue specific risk in order to efficiently and cost effectively gain exposure to the securitized sector.

5. The following replaces the paragraph with respect to “The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio” under “More Information About Fund Investments and Risks” on page 116 of the Prospectus:

The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio – The Portfolio is managed by two Specialist Managers, each of whom is compensated in accordance with a different fee schedule. Although asset allocations and fees payable to the Specialist Managers may vary, the figures assume an actual allocation of assets at June 30, 2012 of 0% BlackRock and 100% Mellon Capital.

The Core Fixed Income Portfolio:

1. The following replaces the “Annual Operating Expenses” section on page 48 of the Prospectus:

Annual Operating Expenses

(expenses that you pay each year as a percentage of the value of your investment)

 

Management Fees (based on asset allocations among Specialist Managers, see “Advisory Services – Specialist Managers”)

     0.17

Other Expenses

     0.08

Total Annual Portfolio Operating Expenses

     0.25

Example: This Example is intended to help you compare the cost of investing in the Portfolio with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Portfolio for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes the reinvestment of all dividends and distributions in shares of the Portfolio and that your investment has a 5% return each year and that the Portfolio’s operating expenses remain the same. Although your actual cost may be higher or lower, based on these assumptions, your costs would be:

 

1 Year

   $ 26   

3 Years

   $ 80   

5 Years

   $ 141   

10 Years

   $ 318   

 

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2. The following supplements the “Specialist Managers” section under “The Core Fixed Income Portfolio” on page 98 of the Prospectus:

 

The Mellon Capital Investment Selection Process   

Mellon Capital currently manages assets for the Portfolio using two separate and distinct strategies.

 

With respect to the portion of the Portfolio invested in investment grade mortgage-backed and asset-backed securities, Mellon Capital employs a disciplined approach which seeks to gain exposure to securities and sectors like those contained in the Barclays Capital US Government Index. It begins by identifying and isolating the major components and sectors and assessing the key characteristics of the index. After analyzing these factors, Mellon Capital Management then invests in securities designed to gain exposure to these different sectors, and that have characteristics that are similar to those which are found in the index. In this process, they also focus on relative value and issue specific risk in order to efficiently and cost effectively gain exposure to the government sector.

 

With respect to the portion of the Portfolio invested in securities issued or fully guaranteed by the U.S. Government, Federal Agencies or sponsored agencies, Mellon Capital employs a disciplined approach which seeks to gain exposure to securities and sectors like those contained in the Barclays Capital US Securitized Index. It begins by identifying and isolating the major components and sectors and assessing the key characteristics of the index. After analyzing these factors, Mellon Capital Management then invests in securities designed to gain exposure to these different sectors, and that have characteristics that are similar to those which are found in the index. In this process, they also focus on relative value and issue specific risk in order to efficiently and cost effectively gain exposure to the securitized sector.

3. The following replaces the paragraph with respect to “The Core Fixed Income Portfolio” under “More Information About Fund Investments and Risks” on page 116 of the Prospectus:

The Core Fixed Income Portfolio – The Portfolio is managed by three Specialist Managers, each of whom is compensated in accordance with a different fee schedule. Although asset allocations and fees payable to the Specialist Managers may vary, the figures assume an actual allocation of assets at June 30, 2012 of 0% BlackRock, 66% Mellon Capital and 34% Seix.

The Fixed Income Opportunity Portfolio:

1. The following replaces the “Annual Operating Expenses” section on page 52 of the Prospectus:

Annual Operating Expenses

(expenses that you pay each year as a percentage of the value of your investment)

 

Management Fees (based on asset allocations among Specialist Managers, see “Advisory Services – Specialist Managers”)

     0.31

Other Expenses

     0.08

Total Annual Portfolio Operating Expenses

     0.39

Example: This Example is intended to help you compare the cost of investing in the Portfolio with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Portfolio for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes the reinvestment of all dividends and distributions in shares of the Portfolio and that your investment has a 5% return each year and that the Portfolio’s operating expenses remain the same. Although your actual cost may be higher or lower, based on these assumptions, your costs would be:

 

1 Year

   $ 40   

3 Years

   $ 125   

5 Years

   $ 219   

10 Years

   $ 493   

 

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2. The following replaces the second paragraph under “Seix Investment Advisors LLC” in the Specialist Manager Guide on page135 of the Prospectus:

For its services to The Fixed Income Opportunity Portfolio Seix receives a fee, based on the average daily net asset value of the assets of the Portfolio under its management at an annual rate of 0.40% for the first $100 million of the Combined Assets (as defined below), 0.25% on the next $200 million of the Combined Assets, and 0.20% on the balance of the Combined Assets. For the purpose of computing Seix’s fee for The Fixed Income Opportunity Portfolio, the term “Combined Assets” shall mean the sum of (i) the net assets of the Portfolio; and (ii) the net assets of each other Hirtle Callaghan account to which Seix provides similar services. During the fiscal year ended June 30, 2012 Seix received a fee of 0.42% of the average daily net assets of that portion of The Fixed Income Opportunity Portfolio allocated to Seix.

PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE.

 

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Supplement to Prospectus

Institutional Portfolios

HC Strategic Shares

Dated November 1, 2012

HC Capital Trust

The date of this Supplement is August 5, 2013

On August 2, 2013, Mellon Capital Management Corporation was added as an additional Specialist Manager to each of the Institutional Value Equity, Institutional Growth Equity, Institutional Small Capitalization Equity, Real Estate Securities, Commodity Returns Strategy, Institutional International Equity and Emerging Markets Portfolios pursuant to Portfolio Management Agreements approved by the shareholders of the respective Portfolios.

Additionally, on August 2, 2013, Ariel Investments, LLC was added as an additional Specialist Manager in the Institutional Small Capitalization Equity Portfolios pursuant to Portfolio Management Agreements approved by the shareholders of the respective Portfolios.

The following material supplements the Prospectus dated November 1, 2012 to incorporate information about the new Specialist Managers.

The Institutional Value Equity Portfolio

1. The following replaces the “Investment Subadvisers” section on page 5 of the Prospectus:

Investment Subadvisers

AllianceBernstein L.P. (“AllianceBernstein”), Institutional Capital, LLC (“ICAP”), Pacific Investment Management Company LLC (“PIMCO”), Mellon Capital and SSgA FM are the Specialist Managers for the Portfolio.

Portfolio Managers:

AllianceBernstein: Gerry Paul has managed the portion of the Portfolio allocated to AllianceBernstein since September, 2009, and Greg Powell has co-managed the portion of the Portfolio allocated to AllianceBernstein since July, 2010.

ICAP: Jerrold K. Senser and Thomas R. Wenzel have co-managed the portion of the Portfolio allocated to ICAP since July, 2008. Thomas C. Cole has managed the portion of the Portfolio allocated to ICAP since July, 2012.

PIMCO: Saumil Parikh has managed a portion of the Portfolio allocated to PIMCO since April, 2009.

Mellon Capital. Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed the portion of the Portfolio allocated to SSgA FM since July, 2012 and July, 2008, respectively.

2. The following replaces the “Specialist Managers.” section on page 55 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Institutional Capital, LLC (“ICAP”), AllianceBernstein L.P. (“AllianceBernstein”) and Pacific Investment Management Company LLC (“PIMCO”) are currently responsible for implementing the active component of the Portfolio’s investment strategy. Additionally, a portion of the Portfolio is managed using “passive” or “index” investment approaches designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component for the Portfolio’s investment strategy. The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

 

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3. The following is added to the Section “More Information About Fund Investments and Risks—The Institutional Value Equity Portfolio” on page 55 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the Russell 1000(R) Value Index. The particular segments of the Russell 1000(R) Value Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The Russell 1000(R) Value Index is an unmanaged, market cap-weighted index, which is reviewed and reconstituted each year. Further information about the Russell 1000(R) Value Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the Russell 1000(R) Value Index.

The Institutional Growth Equity Portfolio

1. The following replaces the “Investment Subadvisers” section on page 17 of the Prospectus:

Investment Subadvisers

Jennison Associates LLC (“Jennison”), PIMCO, Sustainable Growth Advisers LP (“SGA”), Mellon Capital and SSgA FM are the Specialist Managers for the Portfolio.

Portfolio Managers:

Jennison: Kathleen A. McCarragher has managed the portion of the Portfolio allocated to Jennison since August, 2008.

PIMCO: Saumil Parikh has managed the portion of the Portfolio allocated to PIMCO since August, 2008.

SGA: George P. Fraise, Gordon M. Marchand and Robert L. Rohn have co-managed that portion of the Portfolio allocated to SGA since August, 2008.

Mellon Capital. Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed the portion of the Portfolio allocated to SSgA FM since July 2012 and August, 2008 respectively.

2. The following replaces the “Specialist Managers.” section on page 56 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Jennison Associates LLC (“Jennison”), PIMCO and Sustainable Growth Advisers, LP (“SGA”) are currently responsible for implementing the active component of the Portfolio’s investment strategy. The remaining portion of the Portfolio is managed using “passive” or “index” investment approaches that are designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component of the Portfolio’s investment strategy. The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

 

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3. The following is added to the Section “More Information About Fund Investments and Risks—The Institutional Growth Equity Portfolio” on page 57 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of the one or more different segments of the Russell 1000(R) Growth Index. The particular segments of the Russell 1000(R) Growth Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The Russell 1000(R) Growth Index is an unmanaged, market cap-weighted index, which is reviewed and reconstituted each year. Further information about the Russell 1000(R) Growth Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the Russell 1000(R) Growth Index.

The Institutional Small Capitalization Equity Portfolio

1. The following replaces the “Investment Subadvisers” section on page 13 of the Prospectus:

Investment Subadvisers

Cupps Capital Management, LLC (“Cupps”), Frontier Capital Management Company, LLC (“Frontier”), IronBridge Capital Management LP (“IronBridge”), Pzena Investment Management, LLC (“Pzena”), SSgA FM, Mellon Capital and Ariel Investments, LLC (“Ariel”) are the Specialist Managers for the Portfolio.

Portfolio Managers:

Cupps: Andrew S. Cupps has managed the portion of the Portfolio allocated to Cupps since June, 2011.

Frontier: Michael Cavarretta has managed the portion of the Portfolio allocated to Frontier since the Portfolio’s August, 2008.

IronBridge: Christopher C. Faber and Jeffrey B. Madden have co-managed the portion of the Portfolio allocated to IronBridge since August, 2008, and Thomas W. Fanter has co-managed the portion of the Portfolio allocated to IronBridge since November 2011.

Pzena: Richard Pzena, Benjamin Silver and John Flynn have co-managed the portion of the Portfolio allocation to Pzena since April, 2010.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed the portion of the Portfolio allocated to SSgA FM since July, 2012 and July, 2009 respectively.

Mellon Capital. Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

Ariel. David M. Maley and Kenneth E. Kuhrt have co-managed the portion of the Portfolio allocated to Ariel since [August,] 2013.

 

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2. The following replaces the “Specialist Managers.” section on page 58 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Cupps Capital Management, LLC (“Cupps”), Frontier Capital Management Company, LLC (“Frontier”), IronBridge Capital Management LP (“IronBridge”), Pzena Investment Management, LLC (“Pzena”), and Ariel Investments, LLC (“Ariel”) are currently responsible for implementing the active component of the Portfolio’s investment strategy. The remaining portion of the Portfolio is managed using “passive” or “index” investment approaches that are designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component of the Portfolio’s investment strategy. Further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated among them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The Institutional Small Capitalization Equity Portfolio” on page 58:

The Ariel Investment Selection Process: Ariel uses independent thought and research to implement a four-part process. They screen more than 10,000 securities on size, valuation and industry parameters to yield roughly 2,000 issues. Of those they follow approximately 75 closely. They then determine whether or not an idea is cheap enough via a deep value strategy focusing on book value (often 1x or below), tangible book value, cash and other similar factors. There are no rigid criteria to their analytical process; they are trying to determine that a margin of safety exists between price and intrinsic value. They surround companies to paint a long-term picture and identify what others are missing. One key tool is their independent verification network of outside experts. Another tool is deciding the best methodology to determine whether a margin of safety exists. Once they have measured the gap between stock price and intrinsic value, they hold an informal discussion with any research members who are experts in the industry. The lead portfolio manager makes the final decision on whether or not to initiate a position. As natural contrarians, they sell a security when they believe that the valuation is no longer attractive due to assets and/or ability to generate profits and/or free cash flow. In keeping with their long-term patient approach, they will not sell a security because of a short-term disappointment. They will, however, sell a security if their investment thesis has changed, namely by a major shift in the competitive landscape, a deterioration in company fundamentals, and/or a loss of faith in management to execute the stated goals and objectives. The decision to sell is ultimately made by the lead portfolio manager.

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the Russell 2000(R) small capitalization universe (i.e. small capitalization value and small capitalization growth segments). The particular segments of the Russell 2000(R) universe that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The Russell 2000(R) Indices are unmanaged, market cap-weighted indices, which are reviewed and reconstituted each year. Further information about the Russell 2000(R) Indices appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the Russell 2000(R) Indices.

The Real Estate Securities Portfolio

1. The following replaces the “Investment Subadvisers” section on page 18 of the Prospectus:

Investment Subadviser

Wellington Management Company, LLP (“Wellington Management”), SSgA FM and Mellon Capital are the Specialist Managers for the Portfolio.

Portfolio Manager:

Wellington Management: Bradford D. Stoesser has managed the Portfolio since September, 2010.

 

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SSgA FM: John Tucker, CFA and Michael Feehily, CFA have not yet begun providing portfolio management services to the Portfolio.

Mellon Capital. Karen Wong, Warren Chiang, Peter Goslin and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

2. The following replaces the “Specialist Managers.” section on page 59 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Wellington Management Company, LLP (“Wellington Management”) is currently responsible for implementing the active component of the Portfolio’s investment strategy. The remaining portion of the Portfolio is managed using “passive” or “index” investment approaches that are designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component of the Portfolio’s investment strategy. Further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated among them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The Real Estate Securities Portfolio” on page 59 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the Dow Jones US Select REIT Index and FTSE EPRA/NAREIT. The particular segments of these indices that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The Dow Jones US Select REIT Index is designed to provide a measure of real estate securities that serve as proxies for direct real estate investing, in part by excluding securities whose value is not always closely tied to the value of the underlying real estate. The Index is a market capitalization weighted index of publicly traded REITs and is comprised of companies whose charters are the equity ownership and operation of commercial real estate and which operate under the REIT Act of 1960. The FTSE EPRA/NAREIT Global Real Estate Index Series is designed to represent general trends in eligible listed real estate stocks worldwide. Relevant real estate activities are defined as the ownership, trading and development of income-producing real estate. Further information about the Dow Jones US Select REIT Index and FTSE EPRA/NAREIT appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Fund’s returns may vary from the returns of the Dow Jones US Select REIT Index and FTSE EPRA/NAREIT.

The Commodity Returns Strategy Portfolio

1. The following replaces the “Investment Subadvisers” section on page 24 of the Prospectus:

Investment Subadviser

Wellington Management, PIMCO, SSgA FM and Mellon Capital are the Specialist Managers for the Portfolio.

Portfolio Managers:

Wellington Management: Jay Bhutani has managed a portion of the Portfolio allocated to Wellington Management since June, 2010. David Chang and Gregory LeBlanc have managed a portion of the Portfolio allocated to Wellington Management since April 2011.

PIMCO: Nicholas Johnson has managed the portion of the Portfolio allocated to PIMCO since June, 2010.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have not yet begun providing portfolio management services to the Portfolio.

 

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Mellon Capital. Karen Wong, Warren Chiang, Peter Goslin and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

2. The following replaces the “Specialist Managers.” section on page 61 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Wellington Management and PIMCO are currently responsible for implementing the active component of the Portfolio’s investment strategy. The remaining portion of the Portfolio is managed using “passive” or “index” investment approaches that are designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component of the Portfolio’s investment strategy. Further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated among them appears in the “Specialist Manager Guide” included later in this Prospectus

3. The following is added to the Section “More Information About Fund Investments and Risks—The Commodity Returns Strategy Portfolio” on page 61 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the MSCI ACWI Natural Resources Index. The particular segments of the MSCI ACWI Natural Resources Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The MSCI ACWI Natural Resources Index is comprised of large publicly traded companies, based on market capitalization, in global natural resources and commodities businesses that meet certain investability requirements. Further information about the MSCI ACWI Natural Resources Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the MSCI ACWI Natural Resources Index.

The Institutional International Equity Portfolio

1. The following replaces the “Investment Subadvisers” section on page 28 of the Prospectus:

Investment Subadvisers

Artisan Partners Limited Partnership (“Artisan”), Capital Guardian Trust Company (“CapGuardian”), Causeway Capital Management LLC (“Causeway”), Lazard Asset Management LLC (“Lazard”), SSgA FM and Mellon Capital are the Specialist Managers for the Portfolio.

Portfolio Managers:

Artisan: Mark L. Yockey has managed the portion of the Portfolio allocated to Artisan since November, 2009. Andrew J. Euretig and Charles Hamker have managed the portion of the Portfolio allocated to Artisan since February, 2012.

CapGuardian: Gerald Du Manoir, David I. Fisher, Nancy J. Kyle, Lionel M. Sauvage and Rudolf M. Staehelin have co-managed the portion of the Portfolio allocated to CapGuardian since November, 2009 and Philip Winston has co-managed the portion of the Portfolio allocated to CapGuardian since November, 2010.

 

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Causeway: Sarah H. Ketterer, Harry W. Hartford, James A. Doyle, Jonathan P. Eng and Kevin Durkin have co-managed that portion of the Portfolio allocated to Causeway since November, 2009 and Conor Muldoon has co-managed that portion of the Portfolio allocated to Causeway since September, 2010.

Lazard: Paul Moghtader, Taras Ivanenko, Alex Lai and Craig Scholl have co-managed the portion of the Portfolio allocated to Lazard since September, 2011.

SSgA FM: Michael Feehily, CFA and John Tucker, CFA have co-managed that portion of the Portfolio allocated to SSgA FM since July, 2012.

Mellon Capital. Karen Wong, Warren Chiang, Peter Goslin and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

2. The following replaces the “Specialist Managers.” section on page 63 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. Capital Guardian Trust Company (“CapGuardian”), Artisan Partners Limited Partnership (“Artisan”) and Causeway Capital Management LLC (“Causeway”) and Lazard Asset Management LLC (“Lazard”) are currently responsible for implementing the active component of the Portfolio’s investment strategy. Additionally, a portion of the Portfolio may be managed using “passive” or “index” investment approaches designed to approximate as closely as practicable, before expenses, the performance of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). Mellon Capital and SSgA FM are currently responsible for implementing the passive component for the Portfolio’s investment strategy. The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The Institutional International Equity Portfolio” on page 63 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the MSCI EAFE Index. The particular segments of the MSCI EAFE Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The MSCI EAFE Index is a free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. and Canada. Further information about the MSCI EAFE Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Portfolio’s returns may vary from the returns of the MSCI EAFE Index.

The Emerging Markets Portfolio

1. The following replaces the “Investment Subadvisers” section on page 32 of the Prospectus:

Investment Subadvisers

The Boston Company Asset Management LLC (“TBCAM”), SSgA FM and Mellon Capital are the Specialist Managers for the Portfolio.

 

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Portfolio Managers:

TBCAM: Kirk Henry, CFA and Warren Skillman have co-managed the active investment strategy portion of the Portfolio allocated to TBCAM since March, 2010.

SSgA FM: Christopher Laine, Michael Ho, Ph.D and Jean-Christophe de Beaulieu, CFA have managed the active investment strategy portion of the Portfolio allocated to SSgA FM since April, 2010, July, 2012, and July, 2012 respectively.

Michael Feehily, CFA and John Tucker, CFA have co-managed the passive investment strategy portion to the Portfolio allocated to SSgA FM since July, 2012.

Mellon Capital. Karen Wong, Warren Chiang, Peter Goslin and Kristin Crawford have co-managed the portion of the Portfolio allocated to Mellon Capital since August, 2013.

2. The following replaces the “Specialist Managers.” section on page 65 of the Prospectus:

Specialist Managers. A portion of the Portfolio is managed in accordance with an “active management” approach, which involves the buying and selling of securities based upon economic, financial and market analysis and investment judgment. The Boston Company Asset Management LLC (“TBCAM”) and SSgA FM are currently responsible for implementing the active component of the Portfolio’s investment strategy. Mellon Capital and SSgA FM also manage a portion of the Portfolio that may be managed using a “passive” or “index” investment approach designed to replicate the composition of the Portfolio’s benchmark index and, from time to time, one or more identifiable subsets or other portions of that index (see “Fund Management,” included later in this Prospectus). The investment selection process for each of these Specialist Managers is described below; further information about the Specialist Managers, individual portfolio managers responsible for day-to-day investment decisions for the Portfolio, and the manner in which the Portfolio’s assets are allocated between them appears in the “Specialist Manager Guide” included later in this Prospectus.

3. The following is added to the Section “More Information About Fund Investments and Risks—The Emerging Markets Portfolio” on page 65 of the Prospectus:

The Mellon Capital Investment Selection Process: In selecting investments for that portion of the Portfolio allocated to it, Mellon Capital adheres to a “passive” “indexing” or “rules-based” investment approach by which Mellon Capital attempts to approximate as closely as practicable, before expenses, the performance of one or more different segments of the MSCI EM Index. The particular segments of the MSCI EM Index that form the basis for Mellon Capital’s investments are determined by the Adviser in consultation with Mellon Capital. The MSCI EM Index is an unmanaged free float-adjusted market capitalization index that is designed to measure equity market performance of emerging markets. Further information about the MSCI EM Index appears later in this Prospectus under the heading “Investment Risks and Strategies – About Benchmarks and Index Investing.” The Fund’s returns may vary from the returns of the MSCI EM Index.

The Institutional Small Capitalization Equity Portfolio:

1. The following is inserted in the “Specialist Manager Guide” just after the “Alliance Bernstein L.P.” section on page 90:

Ariel Investments, LLC (“Ariel”) serves as a Specialist Manager for The International Small Capitalization Equity Portfolio. Ariel is an investment adviser registered with the Securities and Exchange Commission pursuant to the Investment Advisers Act. Its headquarters are located at 200 East Randolph Street, Suite 2900, Chicago, IL 60601. As of March 31, 2013, Ariel had approximately $6 billion in assets under management.

For its services to The Institutional Small Capitalization Equity Portfolio, Ariel will be paid an annual fee, calculated daily and payable quarterly, in arrears, based on the Combined Assets (i.e., the aggregate of the assets of the Small Cap Portfolio allocated to Ariel and certain other investment advisory accounts at the Adviser or its affiliates for which Ariel provides similar services), in accordance with the following schedule: 1.00% of the first $10 million of the Combined Assets, 0.75% of the next $10 million and 0.50% of Combined Assets exceeding $20 million.

 

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David M. Maley and Kenneth E. Kuhrt will be primarily responsible for the day-to-day management of that portion of the Small Cap Portfolio’s assets allocated to Ariel. Mr. Maley is the firm’s Lead Portfolio Manager for its micro and small cap deep value strategies. He has been with Ariel since 2009 and has previously served as a Vice President at Goldman Sachs, Vice President and Senior Portfolio Manager at Harris Bank and President at Maple Hill Capital Management. Mr. Kuhrt, a Portfolio Manager, is a Certified Public Accountant and has been with the firm since 2004. Prior to joining Ariel, Mr. Kuhrt was a Senior Investment Banking Analyst at William Blair & Co, LLC and a Senior Auditor at KPMG, LLP.

The Institutional Value Equity Portfolio, The Institutional Growth Equity Portfolio, The Institutional Small Capitalization Equity Portfolio, The Real Estate Securities Portfolio, The Commodity Returns Strategy Portfolio, The Institutional International Equity Portfolio and The Emerging Markets Portfolio:

1. The following replaces the “Mellon Capital Management Corporation” section of the “Specialist Manager Guide” on page 96:

Mellon Capital Management Corporation (“Mellon Capital”) serves as a Specialist Manager for The Institutional Value Equity Portfolio, The Institutional Growth Equity Portfolio, The Institutional Small Capitalization Equity Portfolio, The Real Estate Securities Portfolio, The Commodity Returns Strategy Portfolio, The Institutional International Equity Portfolio and The Emerging Markets Portfolio. Mellon Capital, which was organized as a Delaware corporation in 1983, is headquartered at 50 Fremont Street, Suite 3900, San Francisco, CA 94105. Mellon Capital is a wholly-owned indirect subsidiary of The Bank of New York Mellon Corporation (“BNY Mellon”).

For its services to The Institutional Value Equity Portfolio, The Institutional Growth Equity Portfolio, The Institutional Small Capitalization Equity Portfolio, The Real Estate Securities Portfolio, The Commodity Returns Strategy Portfolio, The Institutional International Equity Portfolio and The Emerging Markets Portfolio (the “Equity Portfolios”), Mellon Capital receives fees for each of the Equity Portfolios, calculated based on an annual percentage of average daily net assets. Mellon Capital’s fees would be paid at one level so long as the aggregate assets allocated to Mellon Capital for all of its passive equity mandates (including accounts for other clients of the Adviser and its affiliates besides the Trust) exceed $2 billion. Should these aggregate assets fall below $2 billion, a higher fee will apply. The initial allocation to Mellon Capital is expected to exceed $4.5 billion.

 

     Fee When Aggregate
Assets Are Greater
Than $2 Billion
    Fee When Aggregate
Assets Are Less
Than $2 Billion
 

The Institutional Value Equity Portfolio:

     0.065     0.075

The Institutional Growth Equity Portfolio:

     0.065     0.075

The Institutional Small Capitalization Equity Portfolio:

     0.065     0.075

The Real Estate Securities Portfolio:

     0.10     0.11

The Commodity Returns Strategy Portfolio:

     0.10     0.11

The Institutional International Equity Portfolio:

     0.10%/0.13 %*      0.11%/0.15 %* 

The Emerging Markets Portfolio:

     0.13     0.15

 

* Mellon Capital manages two different strategies, under separate Portfolio Management Agreements, in the Institutional International Equity Portfolio: a developed markets strategy with a fee of 0.10% or 0.11% (based on asset levels as described above) and an emerging markets strategy with a fee of 0.13% or 0.15%.

For its services to The Core Fixed Income Portfolio and The U.S. Government Fixed Income Securities Portfolio, Mellon Capital receives a fee, based on the average daily net asset value of that portion of the assets of the Portfolios managed by it, at an annual rate of 0.06%. During the fiscal year ended June 30, 2013 Mellon received fees of [ ] % of the average daily net assets for each portion of The Core Fixed Income Portfolio and The U.S. Government Fixed Income Securities Portfolio allocated to Mellon.

 

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The Portfolio Managers for the Institutional Value Equity, Institutional Growth Equity, and Institutional Small Capitalization Equity Portfolios are Karen Wong, Warren Chiang, Ronald Gala and Kristin Crawford. The Portfolio Managers for the Real Estate Securities, Commodity Returns Strategy, Institutional International Equity and Emerging Markets Portfolios are Karen Wong, Warren Chiang, Peter Goslin and Kristin Crawford.

Karen Q. Wong, CFA is a Managing Director and Head of Equity Portfolio Management at Mellon Capital.

Warren Chiang, CFA is a Managing Director and Head of Active Equity Strategies at Mellon Capital. He has an M.B.A. and a B. S. from the University of California at Berkeley. Mr. Chiang has 16 years of investment experience and tenure at Mellon Capital. Mr. Chiang manages the entire team of portfolio managers and researchers for all U.S. and international active equity strategies. He is responsible for the refinement and implementation of the active equity portfolio management process.

Ronald Gala, CFA is a Director, Team Leader and Senior Portfolio Manager for the Active Equity Strategies. Mr. Gala has 27 years of investment experience with tenure of 20 years between Mellon Capital and Mellon Equity Associates, LLP. He is a member and past president of the CFA Society of Pittsburgh and a member of the CFA Institute. He has an M.B.A. from the University of Pittsburgh and a B.S. from Duquesne University.

Kristin Crawford is a Vice President and Senior Portfolio Manager for the Active Equity Strategies. Ms. Crawford has 19 years of investment experience with tenure of 13 years between Mellon Capital and Franklin Portfolio Associates. She has an M.B.A. from Suffolk University and a B.S. from Smith College. Prior to joining Mellon Capital, she was a vice president and portfolio manager at Franklin Portfolio Associates.

Peter Goslin, CFA is a Vice President and Senior Portfolio Manager for the Active Equity Strategies. Mr. Goslin has 20 years of investment experience with tenure of 14 years at Mellon Capital. Mr. Goslin has an M.B.A. from the University of Notre Dame in Finance. Prior to joining Mellon Capital, Mr. Goslin was a derivatives trader and NASDAQ market maker for Merrill Lynch and ran Merrill’s Equity Index Option desk at the Chicago Mercantile Exchange.

Day-to-day investment decisions for the portions of The Core Fixed Income Portfolio and The U.S. Government Fixed Income Securities Portfolio allocated to Mellon Capital are the responsibility of David C. Kwan, CFA Ms. Zandra Zelaya, CFA, and Mr. Lowell J. Bennett, CFA. Mr. Kwan is a Managing Director, Fixed Income Management of Mellon Capital with 22 years of investment experience at the firm. He earned both a B.S. and an M.B.A. at the University of California at Berkeley. Ms. Zelaya is a Director of Fixed Income Management of Mellon Capital with 17 years of investment experience and 15 years at the firm. She earned a B.S. at California State University at Haward. Mr. Bennett is a Managing Director, Investment Strategist at Mellon Capital with 25 years of finance and investment experience and 15 years at the firm. He earned both a B.S.I.E and M.B.A. from Stanford University.

As of June 30, 2013, Mellon Capital had assets under management totaling approximately $313 billion, which includes overlay strategies.

The Institutional Value Equity Portfolio, The Institutional Growth Equity Portfolio, The Institutional Small Capitalization Equity Portfolio, The Real Estate Securities Portfolio, The Commodity Returns Strategy Portfolio, The Institutional International Equity Portfolio, The Emerging Markets Portfolio, The Core Fixed Income Portfolio, The Fixed Income Opportunity Portfolio, The U.S. Government Fixed Income Securities Portfolio, The U.S. Corporate Fixed Income Securities Portfolio, The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio: (From the Supplement filed on June 28, 2013)

1. The following replaces the second paragraph under the “Calculating NAV” section of “Shareholder Information” on page 82 of the Prospectus:

The value of each Portfolio’s investments is generally determined by current market quotations. When reliable market quotations are not readily available for any security, the fair value of that security will be determined by a committee established by the Trust’s Board of Trustees (“Board”) in accordance with procedures adopted by the Board. The fair valuation process is designed to value the subject security at the price a Portfolio would reasonably expect to receive upon its current sale. Fair value pricing may be employed, for example, if the value of a security held by a Portfolio has been materially affected by an event that occurs after the close of the market in which the security is traded, in the event of a trading halt in a security for which market quotations are normally available or with respect to securities that are deemed illiquid. When this fair value pricing method is employed, the prices of securities used in the daily computation of a Portfolio’s NAV per share may differ from quoted or published prices for

 

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the same securities. Additionally, security valuations determined in accordance with the fair value pricing method may not fluctuate on a daily basis, as would likely occur in the case of securities for which market quotations are readily available. Consequently, changes in the fair valuation of portfolio securities may be less frequent and of greater magnitude than changes in the price of portfolio securities valued based on market quotations.

The Fixed Income Opportunity Portfolio: (From the Supplement filed on June 28, 2013)

1. The following replaces the “Investment Adviser” and “Investment Subadvisor” sections on page 41 of the Prospectus:

Investment Adviser

HC Capital Solutions is the Portfolio’s investment adviser with responsibility for the management of the Portfolio’s assets, including all investments in other investment companies.

Portfolio Manager:

Thomas Cowhey, CFA has managed the Portfolio since June, 2013.

Investment Subadvisor

Seix, Fort Washington Investment Advisors, Inc. (“Fort Washington”) and PIMCO are the Specialist Managers for the Portfolio with responsibility for the management of the Portfolio’s assets that are invested directly in fixed income securities.

Portfolio Managers:

Fort Washington: Brendan White and Timothy Jossart have co-managed the portion of the Portfolio allocated to Fort Washington since May, 2012.

PIMCO: Curtis Mewbourne has managed the portion of the Portfolio allocated to PIMCO since January, 2010.

Seix: Michael Rieger, Michael Kirkpatrick and Brian Nold have managed that portion of the Portfolio allocated to Seix since November, 2007.

2. The following supplements the “Advisory Services – HC Capital Solutions” disclosure on page 79 of the Prospectus:

Mr. Thomas Cowhey, CFA acts as a portfolio manager for the Real Estate Securities and Fixed Income Opportunity Portfolios. Mr. Cowhey is the Chief Investment Strategist for the Advisor and has been with the Advisor since 2000.

The Real Estate Securities Portfolio: (From the Supplement filed on June 10, 2013) Effective immediately, The Real Estate Securities Portfolio is closed to new investors.

The Commodity Returns Strategy Portfolio: (From the Supplement filed on June 10, 2013) Effective June 10, 2013, The Commodity Returns Strategy Portfolio’s classification changed from non-diversified to diversified. All references to the Portfolio are changed accordingly.

Institutional International Equity Portfolio: (From the Supplement filed on June 10, 2013)

1. The following replaces the first paragraph under the “Artisan Partners Limited Partnership” section of the “Specialist Manager Guide” on page 90 of the Prospectus:

Artisan Partners Limited Partnership (“Artisan”) serves as a Specialist Manager for The International Equity and The Institutional International Equity Portfolios. Artisan, the principal office of which is located at 875 E. Wisconsin Avenue, Suite 800, Milwaukee, WI 53202, has provided investment management services for international equity assets since 1995. As of June 30, 2012, Artisan managed total assets in excess of $64 billion, of which approximately $37 billion consisted of mutual fund assets. Artisan Partners is a limited partnership organized under the laws of Delaware. Artisan Partners is managed by its general partner, Artisan Investments GP LLC, a Delaware limited liability company wholly-owned by Artisan Partners Holdings LP (Artisan Partners Holdings). Artisan Partners Holdings is a limited partnership organized under the laws of Delaware whose sole general partner is Artisan Partners Asset Management Inc., a Delaware Corporation. Artisan Partners was founded in March 2009 and succeeded to the investment management business of Artisan Partners Holdings during 2009. Artisan Partners Holdings was founded in December 1994 and began providing investment management services in March 1995.

 

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The Institutional International Equity Portfolio: (From the Supplement filed on April 25, 2013)

 

1. The following replaces the section of the Prospectus pertaining to Causeway Capital Management LLC under the “Portfolio Managers” section on page 28 of the Prospectus:

Causeway: Sarah H. Ketterer, Harry W. Hartford, James A. Doyle, Jonathan P. Eng and Kevin Durkin have co-managed that portion of the Portfolio allocated to Causeway since November, 2009 and Conor Muldoon has co-managed that portion of the Portfolio allocated to Causeway since September, 2010. Foster Corwith and Alessandro Valentini have co-managed the portion of the Portfolio allocated to Causeway since April 2013.

2. The following replaces the third paragraph under the “Causeway Capital Management LLC” section of the “Specialist Manager Guide” on page 92 of the Prospectus:

Day-to-day management of those assets of The International Equity and Institutional International Equity Portfolios allocated to Causeway is the responsibility of Sarah H. Ketterer, Harry W. Hartford, James A. Doyle, Jonathan P. Eng, Kevin Durkin, Conor Muldoon, Foster Corwith and Alessando Valentini. Ms. Ketterer, Mr. Hartford, Mr. Doyle, Mr. Eng, and Mr. Durkin have been investment professionals with Causeway since 2001, Mr. Muldoon has been an investment professional with Causeway since 2003 and Messrs Corwith and Valentini have been investment professionals with the firm since 2006. Ms. Ketterer and Mr. Hartford were co-founders of Causeway in 2001, and serve as the firm’s chief executive officer and president, respectively. Ms. Ketterer and Mr. Hartford previously served as co-heads of the International and Global Value Equity Team of the Hotchkis and Wiley division of Merrill Lynch Investment Managers, L.P. (“Hotchkis and Wiley”). Messrs. Doyle, Eng, and Durkin, directors of Causeway, were also associated with the Hotchkis and Wiley International and Global Value Equity Team prior to joining Causeway in 2001. Mr. Muldoon, a director of Causeway, previously served as an investment consultant for Fidelity Investments as a liaison between institutional clients and investment managers within Fidelity. Mr. Corwith, a director and fundamental portfolio manager, previously served as a research associate at Deutsche Asset Management where he was responsible for researching consumer staple companies. Mr. Valentini, a director and fundamental portfolio manager, previously worked at Thornburg Investment Management, where he conducted fundamental research focusing on the European telecommunication and Canadian oil sectors.

The Real Estate Securities Portfolio: (From the Supplement filed on April 18, 2013)

Upon the recommendation of the Adviser, the Board of Trustees of HC Capital Trust has approved a modification of the Principal Investment Strategies of the Portfolio to allow the Portfolio to implement its real estate securities strategies by investing primarily in shares of other real estate-oriented investment companies, such as exchange-traded funds (“ETFs”). Accordingly, the following changes to the disclosure related to the Real Estate Securities Portfolio are effective April 26, 2013:

1. The following replaces the “Fees and Expenses” section on page 14 of the Prospectus:

Fees and Expenses

The fee tables below describe the fees and expenses that you may pay if you buy and hold HC Strategic Shares of the Portfolio.

Shareholder Fees

(fees paid directly from your investment)

 

Maximum Sales Charges

     None   

Maximum Redemption Fee

     None   

Annual Operating Expenses

(expenses that you pay each year as a percentage of the value of your investment)

 

Management Fees (based on asset allocations among Specialist Managers, see “Advisory Services – Specialist Managers”)

     0.05

Other Expenses

     0.08

Acquired Fund Fees and Expense

     0.18

Total Annual Portfolio Operating Expenses

     0.31

 

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Example: This Example is intended to help you compare the cost of investing in the Portfolio with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Portfolio for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Portfolio’s operating expenses remain the same. Although your actual cost may be higher or lower, based on these assumptions, your costs would be:

 

1 Year

   $ 32   

3 Years

   $ 100   

5 Years

   $ 174   

10 Years

   $ 393   

2. The following supplements the “Principal Investment Strategies” disclosure on page 14 of the Prospectus:

The Portfolio may implement its principal investment strategy by investing up to 100% of its assets in exchange-traded funds, that themselves invest in real estate-related securities.

3. The following supplements the “Principal Investment Risks” disclosure on page 15 of the Prospectus:

 

 

Investment in Other Investment Companies Risk – As with other investments, investments in other investment companies are subject to market and selection risk. In addition, if the Fund acquires shares of investment companies, shareholders bear both their proportionate share of expenses in the Fund (including management and advisory fees) and, indirectly, the expenses of the other investment companies.

 

 

Exchange-Traded Funds Risk – An investment by the Portfolio in ETFs generally presents the same primary risks as an investment in other investment companies. In addition, an ETF may be subject to the following: (1) a discount of the ETF’s shares to its net asset value; (2) failure to develop or maintain an active trading market for the ETF’s shares; (3) the listing exchange halting trading of the ETF’s shares; (4) failure of the ETF’s shares to track the referenced asset; and (5) holding troubled securities in the referenced index or basket of investments.

4. The following replaces the “Investment Adviser” and “Investment Subadvisor” sections on page 18 of the Prospectus:

Investment Adviser

HC Capital Solutions is the Portfolio’s investment adviser with responsibility for the management of the Portfolio’s assets, including all investments in other investment companies.

Portfolio Manager:

Thomas Cowhey, CFA has managed the Portfolio since April, 2013.

Investment Subadvisor

Wellington Management Company LLP (“Wellington Management”) and SSgA FM are the Specialist Managers for the Portfolio with responsibility for the management of the Portfolio’s assets that are invested directly in real estate securities.

Wellington Management: Bradford D. Stoesser has managed the Portfolio since September, 2010.

SSgA FM: John Tucker, CFA and Michael Feehily, CFA have not yet begun providing portfolio management services to the Portfolio.

5. The following supplements the “More Information About Fund Investments and Risks” disclosure related to the Real Estate Securities Portfolio on page 59 of the Prospectus:

The Portfolio may implement its investment strategy by investing in exchange traded investment companies, known as “ETFs,” that themselves invest in the equity and debt securities issued by real estate-related companies including real estate investment trusts (REITs). For more information on ETFs, see “Investments in Other Investment Companies” on page 79 of this Prospectus.

 

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6. The following supplements the “Investments in Other Investment Companies” disclosure on page 79 of the Prospectus:

Additionally, the Real Estate Securities Portfolio may invest up to 100% of its assets in ETFs that invest in the securities of real estate related companies in reliance on provisions of the Investment Company Act that permit such investments so long as the investing fund, together with any affiliates, does not own more than 3% of the outstanding voting securities of the acquired fund. Under these provisions, the Real Estate Securities Portfolio is required to vote all proxies of the funds it owns in the same proportion as the vote of all other holders of such securities.

7. The following supplements the “Advisory Services – HC Capital Solutions” disclosure on page 79 of the Prospectus:

Mr. Thomas Cowhey, CFA acts as a portfolio manager for the Real Estate Securities Portfolio. Mr. Cowhey is the Chief Investment Strategist for the Advisor and has been with the Advisor since 2000.

The Fixed Income Opportunity Portfolio: (From the Supplement filed on March 5, 2013) Effective immediately, Michael Rieger will no longer serve as a portfolio manager for The Fixed Income Opportunity Portfolio managed by Seix Investment Advisors, LLC (“Seix”).

 

  1. The following replaces the section of the Prospectus with respect to Seix under the “Portfolio Managers” section on page 41 of the Prospectus:

Seix: Michael Kirkpatrick and Brian Nold have managed the portion of the Portfolio allocated to Seix since November, 2007 and Vincent Flanagan has managed the Portfolio since February, 2013.

 

  2. The following replaces the third paragraph under “Seix Investment Advisors LLC” of the “Specialist Manager Guide” on page 97 of the Prospectus:

Day-to-day high yield investment decisions for The Fixed Income Opportunity Portfolio are the responsibility of Michael Kirkpatrick, Brian Nold and Vincent Flanagan. Michael Kirkpatrick, Senior Portfolio Manager and Senior High Yield Research Analyst, focuses principally on the Flagship High Yield Portfolios in addition to a High Yield Unconstrained strategy. Prior to joining Seix in 2002, Mr. Kirkpatrick was a Senior Analyst at Oppenheimer Funds, Inc. covering the Telecommunications and Cable industries. Mr. Nold, Senior Portfolio Manager and Senior High Yield Research Analyst, focuses on a High Yield Unconstrained strategy in addition to the Flagship High Yield Portfolios. Before joining Seix in 2003, he was a High Yield Analyst at Morgan Stanley in Global High Yield Research. Vincent Flanagan, Portfolio Manager and Senior High Yield Research Analyst, is primarily focused on bank loans. Prior to joining Seix in 2006, Mr. Flanagan was the director of research for Assurant, Inc.

The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio: (From the Supplement filed on March 5, 2013)

1. The following supplements the “Portfolio Managers” section on page 53 of the Prospectus:

Mellon Capital: Mr. David C. Kwan, Ms. Zandra Zelaya and Mr. Gregg Lee have co-managed the Portfolio since December, 2012.

The Core Fixed Income Portfolio: (From the Supplement filed on March 5, 2013)

1. The following supplements the “Portfolio Managers” section on page 36 of the Prospectus:

Mellon Capital: Mr. David C. Kwan and Ms. Zandra Zelaya have co-managed the Portfolio since December, 2010 and Mr. Gregg Lee has managed the Portfolio since December, 2012.

The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio and The Core Fixed Income Portfolio: (From the Supplement filed on March 5, 2013)

 

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The following replaces the “Mellon Capital Management Corporation” section of the “Specialist Manager Guide” on page 96 of the Prospectus:

Mellon Capital Management Corporation (“Mellon Capital”) serves as a Specialist Manager for The Core Fixed Income Portfolio, The U.S. Government Fixed Income Securities Portfolio and The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio. Mellon Capital, which was organized as a Delaware corporation in 1983, is headquartered at 50 Fremont Street, Suite 3900, San Francisco, CA 94105. Mellon Capital is a wholly-owned indirect subsidiary of The Bank of New York Mellon Corporation (“BNY Mellon”).

For its services to The Core Fixed Income Portfolio and The U.S. Government Fixed Income Securities Portfolio, Mellon Capital receives a fee, based on the average daily net asset value of that portion of the assets of the Portfolios managed by it, at an annual rate of 0.12%. Effective September 1, 2012, Mellon Capital receives a fee, based on the average daily net asset value of that portion of the assets of the Portfolios managed by it, at an annual rate of 0.06%. For its services to The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio, Mellon Capital receives a fee based on the average daily net asset value of that portion of the assets of the Portfolio managed by it, at an annual rate of 0.06%. During the fiscal year ended June 30, 2012 Mellon received fees of 0.12% of the average daily net assets for each portion of The Core Fixed Income Portfolio and The U.S. Government Fixed Income Securities Portfolio allocated to Mellon.

Day-to-day investment decisions for the portions of The Core Fixed Income Portfolio, The U.S. Government Fixed Income Securities Portfolio and The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio allocated to Mellon Capital are the responsibility of David C. Kwan, CFA, Ms. Zandra Zelaya, CFA and Mr. Gregg Lee, CFA. Mr. Kwan is a Managing Director, Fixed Income Management of Mellon Capital with 22 years of investment experience at the firm. He earned both a B.S. and an M.B.A. at the University of California at Berkeley. Ms. Zelaya is a Director of Fixed Income Management of Mellon Capital with 17 years of investment experience and 15 years at the firm. She earned a B.S. at California State University at Haward. Mr. Gregg Lee is a Vice President, Senior Portfolio Manager at Mellon Capital with 23 years of investment experience and 23 year at the firm. He earned a B.S. at the University of California at Davis.

As of June 30, 2012, Mellon Capital had assets under management totaling approximately $240 billion, which includes overlay strategies.

The Core Fixed Income Portfolio and The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio: (From the Supplement filed on January 8, 2013) Effective January 8, 2013, the investment advisory relationship between the Trust and BlackRock Financial Management, Inc. (“BlackRock”) with respect to The Core Fixed Income Portfolio and The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio has been terminated. Any and all references to BlackRock are hereby removed.

The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio: (From the Supplement filed on December 11, 2012) At a meeting, held on December 4, 2012, the Board of Trustees (the “Board”) for HC Capital Trust (the “Trust”) approved the engagement of Mellon Capital Management Corporation (“Mellon Capital”) as an additional investment advisory organization (“Specialist Manager”) to manage a portion of the assets of The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio of the Trust.

1. The following replaces the “Annual Operating Expenses” section on page 50 of the Prospectus:

Annual Operating Expenses

(expenses that you pay each year as a percentage of the value of your investment)

 

Management Fees

     0.11

Other Expenses

     0.08

Total Annual Portfolio Operating Expenses

     0.19

Example: This Example is intended to help you compare the cost of investing in the Portfolio with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Portfolio for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Portfolio’s operating expenses remain the same. Although your actual cost may be higher or lower, based on these assumptions, your costs would be:

 

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1 Year

   $ 19   

3 Years

   $ 61   

5 Years

   $ 107   

10 Years

   $ 243   

2. The following supplements the “Principal Investment Risks” section on page 51 of the Prospectus:

 

 

Multi-Manager Risk – The risk that the Trust may be unable to (a) identify and retain Specialist Managers who achieve superior investment records relative to other similar investments, (b) pair Specialist Managers that have complementary investment styles, or (c) effectively allocate Portfolio assets among Specialist Managers to enhance the return and reduce the volatility that would typically be expected of any one management style. A multi-manager Portfolio may, under certain circumstances, incur trading costs that might not occur in a Portfolio that is served by a single Specialist Manager.

3. The following replaces the “Investment Subadvisers” section on page 53 of the Prospectus:

Blackrock and Mellon Capital are the Specialist Managers for the Portfolio.

4. The following supplements the “Specialist Managers” section under “The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio” on page 70 of the Prospectus:

 

The Mellon Capital Investment Selection Process    Mellon Capital employs a disciplined approach which seeks to gain exposure to securities and sectors like those contained in the Barclays Capital US Securitized Index. It begins by identifying and isolating the major components and sectors and assessing the key characteristics of the index. After analyzing these factors, Mellon Capital Management then invests in securities designed to gain exposure to these different sectors, and that have characteristics that are similar to those which are found in the index. In this process, they also focus on relative value and issue specific risk in order to efficiently and cost effectively gain exposure to the securitized sector.

5. The following replaces the paragraph with respect to “The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio” under “More Information About Fund Investments and Risks” on page 81 of the Prospectus:

The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio – The Portfolio is managed by two Specialist Managers, each of whom is compensated in accordance with a different fee schedule. Although asset allocations and fees payable to the Specialist Managers may vary, the figures assume an actual allocation of assets at June 30, 2012 of 0% BlackRock and 100% Mellon Capital.

The Core Fixed Income Portfolio:

1. The following replaces the “Annual Operating Expenses” section on page 33 of the Prospectus:

Annual Operating Expenses

(expenses that you pay each year as a percentage of the value of your investment)

 

Management Fees (based on asset allocations among Specialist Managers, see “Advisory Services – Specialist Managers”)

     0.17

Other Expenses

     0.08

Total Annual Portfolio Operating Expenses

     0.25

Example: This Example is intended to help you compare the cost of investing in the Portfolio with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Portfolio for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes the reinvestment of all dividends and distributions in shares of the Portfolio and that your investment has a 5% return each year and that the Portfolio’s operating expenses remain the same. Although your actual cost may be higher or lower, based on these assumptions, your costs would be:

 

1 Year

   $ 26   

3 Years

   $ 80   

5 Years

   $ 141   

10 Years

   $ 318   

 

HCTPROSUPP-INSTL-20130627

Page 16 of 18


2. The following supplements the “Specialist Managers” section under “The Core Fixed Income Portfolio” on page 66 of the Prospectus:

 

The Mellon Capital Investment Selection Process   

Mellon Capital currently manages assets for the Portfolio using two separate and distinct strategies.

 

With respect to the portion of the Portfolio invested in investment grade mortgage-backed and asset-backed securities, Mellon Capital employs a disciplined approach which seeks to gain exposure to securities and sectors like those contained in the Barclays Capital US Government Index. It begins by identifying and isolating the major components and sectors and assessing the key characteristics of the index. After analyzing these factors, Mellon Capital Management then invests in securities designed to gain exposure to these different sectors, and that have characteristics that are similar to those which are found in the index. In this process, they also focus on relative value and issue specific risk in order to efficiently and cost effectively gain exposure to the government sector.

 

With respect to the portion of the Portfolio invested in securities issued or fully guaranteed by the U.S. Government, Federal Agencies or sponsored agencies, Mellon Capital employs a disciplined approach which seeks to gain exposure to securities and sectors like those contained in the Barclays Capital US Securitized Index. It begins by identifying and isolating the major components and sectors and assessing the key characteristics of the index. After analyzing these factors, Mellon Capital Management then invests in securities designed to gain exposure to these different sectors, and that have characteristics that are similar to those which are found in the index. In this process, they also focus on relative value and issue specific risk in order to efficiently and cost effectively gain exposure to the securitized sector.

3. The following replaces the paragraph with respect to “The Core Fixed Income Portfolio” under “More Information About Fund Investments and Risks” on page 81 of the Prospectus:

The Core Fixed Income Portfolio – The Portfolio is managed by three Specialist Managers, each of whom is compensated in accordance with a different fee schedule. Although asset allocations and fees payable to the Specialist Managers may vary, the figures assume an actual allocation of assets at June 30, 2012 of 0% BlackRock, 66% Mellon Capital and 34% Seix.

The Fixed Income Opportunity Portfolio:

1. The following replaces the “Annual Operating Expenses” section on page 37 of the Prospectus:

Annual Operating Expenses

(expenses that you pay each year as a percentage of the value of your investment)

 

Management Fees (based on asset allocations among Specialist Managers, see “Advisory Services – Specialist Managers”)

     0.31

Other Expenses

     0.08

Total Annual Portfolio Operating Expenses

     0.39

Example: This Example is intended to help you compare the cost of investing in the Portfolio with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Portfolio for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes the reinvestment of all dividends and distributions in shares of the Portfolio and that your investment has a 5% return each year and that the Portfolio’s operating expenses remain the same. Although your actual cost may be higher or lower, based on these assumptions, your costs would be:

 

HCTPROSUPP-INSTL-20130627

Page 17 of 18


1 Year

   $ 40   

3 Years

   $ 125   

5 Years

   $ 219   

10 Years

   $ 493   

2. The following replaces the second paragraph under “Seix Investment Advisors LLC” in the Specialist Manager Guide on page 97 of the Prospectus:

For its services to The Fixed Income Opportunity Portfolio Seix receives a fee, based on the average daily net asset value of the assets of the Portfolio under its management at an annual rate of 0.40% for the first $100 million of the Combined Assets (as defined below), 0.25% on the next $200 million of the Combined Assets, and 0.20% on the balance of the Combined Assets. For the purpose of computing Seix’s fee for The Fixed Income Opportunity Portfolio, the term “Combined Assets” shall mean the sum of (i) the net assets of the Portfolio; and (ii) the net assets of each other Hirtle Callaghan account to which Seix provides similar services. During the fiscal year ended June 30, 2012 Seix received a fee of 0.42% of the average daily net assets of that portion of The Fixed Income Opportunity Portfolio allocated to Seix.

PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE.

 

HCTPROSUPP-INSTL-20130627

Page 18 of 18


STATEMENT OF ADDITIONAL INFORMATION

HC Advisors Shares

November 1, 2012

As Supplemented August 5, 2013

HC CAPITAL TRUST

FIVE TOWER BRIDGE, 300 BARR HARBOR DRIVE, SUITE 500

WEST CONSHOHOCKEN, PA 19428-2970

This Statement of Additional Information is designed to supplement information contained in the Prospectus relating to HC Capital Trust (“Trust”). The Trust is an open-end, series, management investment company registered under the Investment Company Act of 1940, as amended (“Investment Company Act”). HC Capital Solutions serves as the overall investment adviser to the Trust under the terms of a discretionary investment advisory agreement. It generally oversees the services provided to the Trust. HC Capital Solutions is a separate operating division of Hirtle Callaghan & Co., LLC (the “Adviser”). This document although not a Prospectus, is incorporated by reference in its entirety in the Trust’s Prospectuses and should be read in conjunction with the Trust’s Prospectuses dated November 1, 2012. A copy of those Prospectuses is available by contacting the Trust at (800) 242-9596.

 

    

Ticker Symbol

The Value Equity Portfolio    HCVPX
The Institutional Value Equity Portfolio    HCEIX
The Growth Equity Portfolio    HCGWX
The Institutional Growth Equity Portfolio    HCIWX
The Small Capitalization Equity Portfolio    HCSAX
The Institutional Small Capitalization Equity Portfolio    HCISX
The Real Estate Securities Portfolio    HCRSX
The Commodity Returns Strategy Portfolio    HCCAX
The International Equity Portfolio    HCIAX
The Institutional International Equity Portfolio    HCITX
The Emerging Markets Portfolio    HCEPX
The Core Fixed Income Portfolio    HCFNX
The Fixed Income Opportunity Portfolio    HCFOX
The U.S. Government Fixed Income Securities Portfolio    HCUAX
The U.S. Corporate Fixed Income Securities Portfolio    HCXAX
The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio    HCAAX
The Short-Term Municipal Bond Portfolio    HCSTX

The Intermediate Term Municipal Bond Portfolio

The Intermediate Term Municipal Bond II Portfolio

  

HCIBX

HCBAX

This Statement of Additional Information does not contain all of the information set forth in the registration statement filed by the Trust with the Securities and Exchange Commission (“SEC”) under the Securities Act of 1933. Copies of the registration statement may be obtained at a reasonable charge from the SEC or may be examined, without charge, at its offices in Washington, D.C.

The Trust’s Annual Report to Shareholders dated June 30, 2012 and Semi-Annual Report dated December 31, 2011 accompanies this Statement of Additional Information and is incorporated herein by reference. The date of this Statement of Additional Information is November 1, 2012.


TABLE OF CONTENTS

 

Statement of Additional Information Heading

   Page     

Corresponding Prospectus Heading

Management of the Trust

     3       Management of the Trust

Further Information About the Trust’s Investment Policies

     23       Investment Risks and Strategies

Investment Restrictions

     55       Investment Risks and Strategies

Additional Purchase and Redemption Information

     58       Shareholder Information

Portfolio Transactions and Valuation

     58       Shareholder Information

Dividends, Distributions and Taxes

     105       Shareholder Information

History of the Trust and Other Information

     109       Management of Trust

Proxy Voting

     112       N/A

Independent Registered Public Accounting Firm and Financial Statements

     130       Financial Highlights

Ratings Appendix

     131       N/A

 

2


MANAGEMENT OF THE TRUST

GOVERNANCE. The Trust’s Board of Trustees (“Board”) currently consists of five members. A majority of the members of the Board are individuals who are not “interested persons” of the Trust within the meaning of the Investment Company Act; in the discussion that follows, these Board members are referred to as “Independent Trustees.” The remaining Board member is a senior officer of the Adviser and is thus considered an “interested person” of the Trust for purposes of the Investment Company Act. This Board member is referred to as an “Affiliated Trustee.” Each Trustee serves until the election and qualification of his or her successor, unless the Trustee sooner resigns or is removed from office.

Day-to-day operations of the Trust are the responsibility of the Trust’s officers, each of whom is elected by, and serves at the pleasure of, the Board. The Board is responsible for the overall supervision and management of the business and affairs of the Trust and of each of the Trust’s separate investment portfolios (each, a “Portfolio” and collectively, the “Portfolios”), including the selection and general supervision of those investment advisory organizations (“Specialist Managers”) retained by the Trust to provide portfolio management services to the respective Portfolios. The Board also may retain new Specialist Managers or terminate particular Specialist Managers, if the Board deems it appropriate to do so in order to achieve the overall objectives of the Portfolio involved. More detailed information regarding the Trust’s use of a multi-manager structure appears in this Statement of Additional Information under the heading “Management of the Trust: Multi-Manager Structure.”

OFFICERS AND AFFILIATED TRUSTEE. The table below sets forth certain information about the Trust’s Affiliated Trustee, as well as its executive officers.

 

NAME, ADDRESS, AND AGE

  

POSITION(S)

HELD WITH

TRUST

   TERM OF
OFFICE;
TERM

SERVED IN
OFFICE
  

PRINCIPAL
OCCUPATION(S)

DURING PAST 5 YEARS

   NUMBER OF
PORTFOLIOS
IN FUND
COMPLEX
OVERSEEN
   OTHER
DIRECTORSHIPS
HELD BY
TRUSTEE**

Robert J. Zion*

Five Tower Bridge,

300 Barr Harbor Drive,

W. Conshohocken, PA 19428

Age: 51

   Trustee; President    Indefinite;
Trustee since
4/30/07;
President since
6/12/2012
   Mr. Zion is currently the Chief Operating Officer, Secretary and a Principal of the Adviser. He has been with the Adviser for more than the past five years.    19    None

Colette Bull

Five Tower Bridge,

300 Barr Harbor Drive,

W. Conshohocken, PA 19428

Age: 43

   Vice President & Treasurer    Indefinite;
Since
6/12/2012
   Ms. Bull is currently a Vice President of the Advisor. She has been with the Adviser for more than 5 years.    19    None

Guy Talarico

Alaric Compliance Services, LLC

150 Broadway, Suite 302

New York, NY 10038

Age: 58

   Chief Compliance Officer    Indefinite;
Since
4/25/2013
   Mr. Talarico is the founder and CEO of Alaric Compliance Services LLC and has been since the company’s inception in 2004.    19    NA

 

3


NAME, ADDRESS, AND AGE

  

POSITION(S)

HELD WITH

TRUST

   TERM OF
OFFICE;
TERM

SERVED IN
OFFICE
  

PRINCIPAL OCCUPATION(S)

DURING PAST 5 YEARS

   NUMBER OF
PORTFOLIOS
IN FUND
COMPLEX
OVERSEEN
   OTHER
DIRECTORSHIPS
HELD BY
TRUSTEE**

Kristin Schantz

Citi Fund Services

3435 Stelzer Road

Columbus, OH 43219

Age: 33

   Secretary    Indefinite;
Since
12/10/09
   Ms. Schantz is a Vice President and has been with Citi Fund Services Ohio, Inc. since January 2008. Prior to that she was an Assistant Vice President at Bank of America Corporation from September 2006 to January 2008 and Assistant Counsel at BISYS Fund Services Ohio, Inc. from October 2005 to September 2006.    19    NA

 

* Mr. Zion may be deemed to be an “interested person,” of the Adviser as that term is defined by the Investment Company Act, as a result of his past or present positions with the Adviser or its affiliates.
** The information in this column relates only to directorships in companies required to file certain reports with the SEC under the various federal securities laws.

INDEPENDENT TRUSTEES. The following table sets forth certain information about the Independent Trustees.

 

NAME, ADDRESS, AND AGE

  

POSITION(S)

HELD WITH

TRUST

   TERM OF
OFFICE; TERM
SERVED IN
OFFICE
  

PRINCIPAL
OCCUPATION(S)

DURING PAST 5 YEARS

   NUMBER OF
PORTFOLIOS
IN FUND
COMPLEX
OVERSEEN
   OTHER
DIRECTORSHIPS
HELD BY
TRUSTEE*

Jarrett Burt Kling

Five Tower Bridge,

300 Barr Harbor Drive,

W. Conshohocken, PA 19428

Age: 69

   Trustee    Indefinite; Since
7/20/95
   For more than the past five years Mr. Kling has been a managing director of CBRE Clarion Securities, LLC, a registered investment adviser.    19   

Harvey G. Magarick

Five Tower Bridge,

300 Barr Harbor Drive,

W. Conshohocken, PA 19428

Age: 74

   Trustee    Indefinite; Since
7/01/04
   Mr. Magarick is retired. Prior to June 3, 2004, he was a partner in the accounting firm of BDO Seidman, LLP.    19    Atlas Energy LP

R. Richard Williams

Five Tower Bridge,

300 Barr Harbor Drive,

W. Conshohocken, PA 19428

Age: 68

   Trustee    Indefinite; Since
7/15/99
   Since 2000, Mr. Williams has been the owner of Seaboard Advisers (consulting services).    19    Franklin Square
Energy and Power
Fund

Richard W. Wortham, III

Five Tower Bridge,

300 Barr Harbor Drive,

W. Conshohocken, PA 19428

Age: 74

   Trustee    Indefinite; Since
7/20/95
   Mr. Wortham is currently the President of The Wortham Foundation and has been a Trustee for more than the past five years.    19    Oncor Electric
Delivery Company

LLC

 

* The information in this column relates only to directorships in companies required to file certain reports with the SEC under the various federal securities laws.

 

4


The Independent Trustees identified in the table above have served together on the Trust’s Board for 8 years. Taken as a whole, the Board represents a broad range of business and investment experience, as well as professional skills. Mr. Magarick has extensive experience in public accounting, tax and internal controls and was previously a Partner with BDO Seidman, LLP. Mr. Kling, who holds a B. S. from the Wharton School of The University of Pennsylvania, has over 40 years of experience in investment management and as a co-founder of ING Real Estate Securities, LLC, has extensive experience in the distribution of investment products. Mr. Williams brings to the Board the experience of a long term business owner, having founded, owned and operated a company that became, during his tenure, the country’s largest distributor of certain industrial equipment, as well as a market leader in pharmaceutical, commercial construction and other business segments. Mr. Wortham has over three decades of executive management experience, having served as a Trustee of The Wortham Foundation, a private philanthropic foundation with assets of approximately $260 million. He is also a life trustee of the Museum of Fine Arts Houston, serving on the executive, finance, investment and audit committees, and is a director of a large electrical transmission and distribution company. The Affiliated Trustee, Mr. Zion, was a certified public accountant with Coopers & Lybrand LLP prior to joining the Hirtle Callaghan organization, has served in executive capacities with companies affiliated with Hirtle Callaghan & Co., LLC for more than ten years.

COMMITTEES OF THE BOARD OF TRUSTEES. The Board has established several committees to assist the Trustees in fulfilling their oversight responsibilities.

The Nominating Committee is responsible for the nomination of individuals to serve as Independent Trustees. The Nominating Committee, whose members consist of all of the Independent Trustees, did not meet during the fiscal year ended June 30, 2012. The Nominating Committee will consider persons submitted by security holders for nomination to the Board. Recommendations for consideration by the Nominating Committee should be sent to the Secretary of the Trust in writing, together with appropriate biographical information concerning each such proposed nominee, at the principal executive office of the Trust. When evaluating individuals for recommendation for Board membership, the Nominating Committee considers the candidate’s knowledge of the mutual fund industry, educational background and experience and the extent to which such experience and background would enable the Board to maintain a diverse mix of skills and qualifications. Additionally, the entire Board annually performs a self-assessment with respect to its current members, which includes a review of their backgrounds, professional experience, qualifications and skills.

The Audit Committee is responsible for overseeing the audit process and the selection of independent registered public accounting firms for the Trust, as well as providing assistance to the full Board in fulfilling its responsibilities as they relate to fund accounting, tax compliance and the quality and integrity of the Trust’s financial reports. The Audit Committee, whose members consist of all of the Independent Trustees, held 5 meetings during the fiscal year ended June 30, 2012. Mr. Magarick currently serves as the Audit Committee Chairman.

Compliance and Risk Oversight Process. The Trustees overall responsibility for identifying and overseeing the operational, business and investment risks inherent in the operation of the Trust is handled by the Board as a whole and by the Board’s Audit Committee, particularly with respect to valuation and accounting matters. To assist them in carrying out their oversight responsibilities, the Trustees receive, in connection with each of the Board’s regular quarterly meetings, regular reports from the Trust’s Administrator with respect to portfolio compliance, fund accounting matters and matters relating to the computation of the Trust’s net asset value per share. The Trustees also receive reports, at least quarterly, from the Trust’s Chief Compliance Officer or “CCO”. These reports, together with presentations provided to the Board at its regular meetings and regular compliance conference calls (normally monthly) among the Advisor, the CCO and the Chair of the Board’s Audit Committee, are designed to keep the Board informed with respect to the effectiveness of the Trust’s overall compliance program including compliance with stated investment strategies, and to help ensure that the occurrence of any event or circumstance that may have a material adverse affect on the Trust are brought promptly to the attention of the Board and that appropriate action is taken to mitigate any such adverse effect. Additionally, the full Board annually receives a report from the Trust’s CCO and both the full Board and, at the discretion of the Independent Trustees, the Independent Trustees separately meet with the CCO for the purpose of discussing the extent to which the Trust’s overall compliance program is reasonably designed to detect and prevent violations of the federal securities laws and assessing the effectiveness of the overall compliance program. Additionally, both the Board, and the Audit Committee (or, Audit Committee Chair) meet at least annually with the Trust’s independent public accounting firm. As indicated above, the Audit Committee is comprised solely of Independent Trustees and the Audit Committee and its Chair are regular participants in the compliance and risk oversight process. To date, the Board has not found it necessary to specifically identify a “lead trustee” or to elect, as the Board’s Chairman, an Independent Trustee, although the Board reserves the right to do so in the future.

COMPENSATION ARRANGEMENTS. Since January 1, 2011, each of the Independent Trustees has been entitled to receive from the Trust a fee of (i) $50,000 per year; (ii) an additional $10,000 for each regular and special in person Board meeting attended by him (regardless of whether attendance is in person or by telephone), plus reimbursement for reasonable out-of-pocket expenses incurred in connection with his attendance at such meetings; (iii) $2,500 for each Audit Committee Meeting attended in person or telephonically and (iv) $2,500 per each regular and special telephonic meeting attended by him, plus reimbursement for reasonable out-of-pocket expenses incurred in connection with his attendance at such meetings. Committee Chairs receive an additional $10,000 annual fee.

 

5


The Affiliated Trustee and the Trust’s officers receive no compensation from the Trust for performing the duties of their respective offices. The table below shows the aggregate compensation received from the Trust by each of the Independent Trustees during the fiscal year ending June 30, 2012 (excluding reimbursed expenses).

 

NAME

   AGGREGATE
COMPENSATION
FROM

TRUST
     PENSION
RETIREMENT

BENEFITS
FROM TRUST
     ESTIMATED
BENEFITS

UPON
RETIREMENT
FROM

TRUST
     TOTAL
COMPENSATION

FROM TRUST
 

Jarrett Burt Kling

   $ 112,500         none         none       $ 112,500   

Harvey G. Magarick

   $ 122,500         none         none       $ 122,500   

R. Richard Williams

   $ 112,500         none         none       $ 112,500   

Richard W. Wortham, III

   $ 112,500         none         none       $ 112,500   

TRUSTEE OWNERSHIP OF SECURITIES OF HC CAPITAL TRUST. The table below sets forth the extent of each Trustee’s beneficial interest in shares of the Portfolios as of December 31, 2011. For purposes of this table, beneficial interest includes any direct or indirect pecuniary interest in securities issued by the Trust and includes shares of any of the Trust’s Portfolios held by members of a Trustee’s immediate family. As of September 30, 2012, all of the officers and trustees of the Trust own, in the aggregate, less than one percent of the outstanding shares of the respective Portfolios of the Trust; officers and Trustees of the Trust may, however, be investment advisory clients of the Adviser and shareholders of the Trust.

 

6


    ROBERT
J. ZION  *
    JARRETT
BURT
KLING
    HARVEY G.
MAGARICK
    R.
RICHARD

WILLIAMS
    RICHARD
W.

WORTHAM,
III  **
 

The Value Equity Portfolio

    D        d        d        e        a   

The Institutional Value Equity Portfolio

    E        a        d        a        a   

The Growth Equity Portfolio

    E        e        d        e        a   

The Institutional Growth Equity Portfolio

    E        a        e        a        a   

The Small Capitalization Equity Portfolio

    B        c        b        e        a   

The Institutional Small Capitalization Equity Portfolio

    D        a        c        a        a   

The Real Estate Securities Portfolio

    A        a        b        a        a   

The Commodity Returns Strategy Portfolio

    A        c        d        e        a   

The International Equity Portfolio

    D        e        d        e        a   

The Institutional International Equity Portfolio

    E        a        e        a        a   

The Emerging Markets Portfolio

    E        c        d        e        a   

The Core Fixed Income Portfolio

    A        a        c        a        a   

The Fixed Income Opportunity Portfolio

    A        a        e        a        a   

The U.S. Government Fixed Income Securities Portfolio

    A        a        a        a        a   

The U.S. Corporate Fixed Income Securities Portfolio

    A        a        a        a        a   

The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio

    A        a        a        a        a   

The Short-Term Municipal Bond Portfolio

    A        a        c        a        a   

The Intermediate Term Municipal Bond Portfolio

    a        d        e        a        a   

The Intermediate Term Municipal Bond II Portfolio

    a        a        c        a        a   

AGGREGATE DOLLAR RANGE OF TRUST SHARES

    e        e        e        e        a   

NOTE:

a = None

b = $1—$10,000

c = $10,001—$50,000

d = $50,001—$100,000

e = Over $100,000

 

7


 

* Mr. Zion is also a trustee of a Revocable Trust which held shares as of December 31, 2011 of between $10,001-$50,000 in The Intermediate Term Municipal Bond Portfolio, and also held shares as of December 31, 2011 of over $100,000 in each of The Value Equity Portfolio, The Growth Equity Portfolio, The International Equity Portfolio, and The Emerging Markets Portfolio. Mr. Zion disclaims beneficial ownership of the Trust.
** Mr. Wortham serves as a trustee for the Wortham Foundation which held shares as of December 31, 2011 of over $100,000 in each of The Emerging Markets Portfolio, The Fixed Income Opportunity Portfolio, The Institutional Value Equity Portfolio, The Institutional Growth Equity Portfolio, The Institutional Small Capitalization Equity Portfolio and The Institutional International Equity Portfolio. Mr. Wortham has no beneficial interest in the Foundation.

MULTI-MANAGER STRUCTURE. As noted in the Prospectus, each of the Trust’s Portfolios is authorized to operate on a “multi-manager” basis. This means that a single Portfolio may be managed by more than one Specialist Manager. The multi-manager structure is generally designed to combine two or more investment styles. The goal of the multi-manager structure is to achieve a better rate of return with lower volatility than would typically be expected of any one management style. Its success depends upon the ability of the Adviser, under the oversight of the Board, to: (a) identify and retain Specialist Managers who have achieved and will continue to achieve superior investment records relative to selected benchmarks; (b) pair Specialist Managers that have complementary investment styles (e.g., top-down vs. bottom-up investment selections processes); (c) monitor Specialist Managers’ performance and adherence to stated styles; and (d) effectively allocate Portfolio assets among Specialist Managers. At present, the Value Equity, Growth Equity, Small Capitalization Equity, International Equity, Emerging Markets, Institutional Value Equity, Institutional Growth Equity, Institutional Small Capitalization Equity, Institutional International Equity, Fixed Income Opportunity, Core Fixed Income, Real Estate Securities, and Commodity Returns Strategy Portfolios each employ the multi-manager structure.

Engagement and Termination of Specialist Managers. The Board is responsible for making decisions with respect to the engagement and/or termination of Specialist Managers based on a continuing quantitative and qualitative evaluation of their skills and proven abilities in managing assets pursuant to specific investment styles. While superior performance is regarded as the ultimate goal, short-term performance by itself is not a significant factor in selecting or terminating Specialist Managers. From time to time, the Adviser may recommend, and the Board may consider, terminating the services of a Specialist Manager. The criteria for termination may include, but are not limited to, the following: (a) departure of key personnel from the Specialist Manager’s firm; (b) acquisition of the Specialist Manger by a third party; (c) change in or departure from investment style, or (d) prolonged poor performance relative to the relevant benchmark index.

The Board’s authority to retain Specialist Managers is subject to the provisions of Section 15(a) of the Investment Company Act. Section 15(a) prohibits any person from serving as an investment adviser to a registered investment company unless the written contract has been approved by the shareholders of that company. Rule 15a-4 under the Investment Company Act, however, provides for an exception from the provisions of Section 15(a). The rule permits an adviser to provide advisory services to an investment company before shareholder approval is obtained pursuant to the terms of an interim agreement in the event that a prior advisory contract is terminated by action of such company’s board; in such case, a new contract must be approved by such shareholders within 150 days of the effective date of the interim agreement, or such interim agreement will terminate. The Trust has relied upon the provisions of Rule 15a-4 from time to time, as more fully discussed in this Statement of Additional Information under the heading “Management of the Trust: Investment Advisory Arrangements.” The Board has authorized the Trust’s officers to request an order from the SEC that would exempt the Trust from the provisions of Section 15(a) and certain related provisions of the Investment Company Act. If issued, such an order would permit the Trust to enter into portfolio management agreements with Specialist Managers upon the approval of the Board but without submitting such contracts for the approval of the shareholders of the relevant Portfolio. The shareholders of each Portfolio have approved this structure. Unless otherwise permitted by law, the Board will not act in reliance upon such order with respect to any Portfolio unless the approval of the shareholders of that Portfolio is first obtained. The SEC has proposed a rule that, if adopted, would provide relief from Section 15(a) similar to that currently available only by SEC order. The Board may consider relying upon this rule, if adopted, in connection with the Trust’s multi-manager structure. There can be no assurance that the requested order will be issued by the SEC.

Allocation of Assets Among Specialist Managers. The Adviser is responsible for determining the level of assets that will be allocated among the Specialist Managers in those Portfolios that are served by two or more Specialist Managers. The Adviser and the Trust’s officers monitor the performance of both the overall Portfolio and of each Specialist Manager and, from time to time, may make changes in the allocation of assets to the Specialist Managers that serve a particular Portfolio. For example, a reallocation may be made in the event that a Specialist Manager experiences variations in performance as a result of factors or conditions that affect the particular universe of securities emphasized by that investment manager, as a result of personnel changes within the manager’s organization or in connection with the engagement of an additional Specialist Manager for a particular Portfolio.

 

8


INVESTMENT ADVISORY ARRANGEMENTS. The services provided to the Trust by the Adviser and by the various Specialist Managers are governed under the terms of written agreements, in accordance with the requirements of the Investment Company Act. Each of these agreements is described below.

The HC Capital Agreement. The services provided to the Trust by the Adviser, described above and in the Prospectus, are governed under the terms of two written agreements with the Trust (“HC Capital Agreements”).

Each HC Capital Agreement provides for an initial term of two years. Thereafter, each HC Capital Agreement remains in effect from year to year so long as such continuation is approved, at a meeting called for the purpose of voting on such continuance, at least annually (i) by the vote of a majority of the Board or the vote of the holders of a majority of the outstanding securities of the Trust within the meaning of Section 2(a)(42) of the Investment Company Act; and (ii) by a majority of the Independent Trustees, by vote cast in person. Each of the HC Capital Agreements may be terminated at any time, without penalty, either by the Trust or by the Adviser, upon sixty days written notice and will automatically terminate in the event of its assignment as defined in the Investment Company Act. The HC Capital Agreements permit the Trust to use the logos and/or trademarks of the Adviser. In the event, however, that the HC Capital Agreements are terminated, the Adviser has the right to require the Trust to discontinue any references to such logos and/or trademarks and to change the name of the Trust as soon as is reasonably practicable. The HC Capital Agreements further provide that the Adviser will not be liable to the Trust for any error, mistake of judgment or of law, or loss suffered by the Trust in connection with the matters to which the HC Capital Agreements relate (including any action of any officer of the Adviser or employee in connection with the service of any such officer or employee as an officer of the Trust), whether or not any such action was taken in reliance upon information provided to the Trust by the Adviser, except losses that may be sustained as a result of willful misfeasance, reckless disregard of its duties, bad faith or gross negligence on the part of the Adviser.

The dates of the Board and shareholder approvals of the HC Capital Agreements with respect to each Portfolio are set forth as follows:

 

          MOST RECENT
CONTRACT
APPROVAL
 

AGREEMENT RELATING TO:

   SHAREHOLDERS    BOARD  

The Value Equity Portfolio

   December 27, 2006      March 12, 2013   

The Institutional Value Equity Portfolio

   July 18, 2008      March 12, 2013   

The Growth Equity Portfolio

   December 27, 2006      March 12, 2013   

The Institutional Growth Equity Portfolio

   August 8, 2008      March 12, 2013   

The Small Capitalization Equity Portfolio

   December 27, 2006      March 12, 2013   

The Institutional Small Capitalization Equity Portfolio

   August 15, 2008      March 12, 2013   

The Real Estate Securities Portfolio

   May 14, 2009      March 12, 2013   

The Commodity Returns Strategy Portfolio

   June 2, 2010      March 12, 2013   

The International Equity Portfolio

   December 27, 2006      March 12, 2013   

The Institutional International Equity Portfolio

   November 20, 2009      March 12, 2013   

The Emerging Markets Portfolio

   December 10, 2009      March 12, 2013   

The Core Fixed Income Portfolio

   December 27, 2006      March 12, 2013   

 

9


        MOST RECENT
CONTRACT
APPROVAL
 

AGREEMENT RELATING TO:

  SHAREHOLDERS   BOARD  

The Fixed Income Opportunity Portfolio

  December 27, 2006     March 12, 2013   

The U.S. Government Fixed Income Securities Portfolio

  November 22, 2010     March 12, 2013   

The U.S. Corporate Fixed Income Securities Portfolio

  November 22, 2010     March 12, 2013   

The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio

  November 22, 2010     March 12, 2013   

The Short-Term Municipal Bond Portfolio

  December 27, 2006     March 12, 2013   

The Intermediate Term Municipal Bond Portfolio

  December 27, 2006     March 12, 2013   

The Intermediate Term Municipal Bond II Portfolio

  July 13, 2010     March 12, 2013   

Portfolio Management Contracts with Specialist Managers. The provision of portfolio management services by the various Specialist Managers is governed by individual investment advisory contracts (each, a “Portfolio Management Contract”) between the relevant Specialist Manager and the Trust. Each of the Portfolio Management Contracts includes a number of similar provisions. Each Portfolio Management Contract provides that the named Specialist Manager will, subject to the overall supervision of the Board, provide a continuous investment program for the assets of the Portfolio to which such contract relates, or that portion of such assets as may be, from time, to time allocated to such Specialist Manager. Under their respective contracts, each Specialist Manager is responsible for the provision of investment research and management of all investments and other instruments and the selection of brokers and dealers through which securities transactions are executed. Each of the contracts provides that the named Specialist Manager will not be liable to the Trust for any error of judgment or mistake of law on the part of the Specialist Manager, or for any loss sustained by the Trust in connection with the purchase or sale of any instrument on behalf of the named Portfolio, except losses that may be sustained as a result of willful misfeasance, reckless disregard of its duties, bad faith or gross negligence on the part of the named Specialist Manager. Each of the Portfolio Management Contracts provides that it will remain in effect for an initial period of two years and then from year to year so long as such continuation is approved, at a meeting called to vote on such continuance, at least annually: (i) by the vote of a majority of the Board or the vote of the holders of a majority of the outstanding securities of the Trust within the meaning of Section 2(a)(42) of the Investment Company Act; and (ii) by a majority of the Independent Trustees, by vote cast in person, and further, that the contract may be terminated at any time, without penalty, either by the Trust or by the named Specialist Manager, in each case upon sixty days’ written notice. Each of the Portfolio Management Contracts provides that it will automatically terminate in the event of its assignment, as that term is defined in the Investment Company Act.

The Portfolio Management Contracts and the Portfolios to which they relate are listed on the following pages:

 

PORTFOLIO

  

SPECIALIST MANAGER

   SERVED
PORTFOLIO
SINCE
   MOST RECENT
CONTRACT

SHAREHOLDERS
   MOST RECENT
CONTRACT

BOARD
The Value Equity Portfolio    Institutional Capital LLC (“ICAP”)(1)    Inception
(August 25, 1995)
   September 29, 2006    June 25, 2013
   Mellon Capital Management Corporation (“Mellon Capital”)    August 2, 2013    August 2, 2013    June 25, 2013
   SSgA Funds Management, Inc. (“SSgA FM”)    July 2, 2001    July 27, 2001    September 11, 2012
   AllianceBernstein L.P. (“AllianceBernstein”)    December 24,
2008
   December 5, 2008    June 25, 2013
The Institutional Value Equity Portfolio    ICAP    Inception (July
18, 2008)
   July 18, 2008    June 25, 2013
   Mellon Capital    August 2, 2013    August 2, 2013    June 25, 2013
   SSgA FM    Inception (July
18, 2008)
   July 18, 2008    September 11, 2012
   AllianceBernstein    December 24,
2008
   December 5, 2008    June 25, 2013
   Pacific Investment Management Company LLC (“PIMCO”)    April 22, 2009    December 5, 2008    June 25, 2013

 

10


PORTFOLIO

  

SPECIALIST MANAGER

   SERVED
PORTFOLIO
SINCE
   MOST RECENT
CONTRACT
APPROVAL

SHAREHOLDERS
   MOST
RECENT
CONTRACT
APPROVAL

BOARD
The Growth Equity Portfolio    Jennison Associates LLC (“Jennison”)    August 25, 1995    July 21, 1995    June 25, 2013
   Mellon Capital    August 2, 2013    August 2, 2013    June 25, 2013
   SSgA FM    July 2, 2001    July 27, 2001    September
11, 2012
   Sustainable Growth Advisers (“SGA”)    May 22, 2006    May 15, 2006    June 25, 2013
The Institutional Growth Equity Portfolio    Jennison    Inception
(August 8,
2008)
   August 8, 2008    June 25, 2013
   Mellon Capital    August 2, 2013    August 2, 2013    June 25, 2013
   SSgA FM    Inception
(August 8,
2008)
   August 8, 2008    September
11, 2012
   SGA    Inception
(August 8,
2008)
   August 8, 2008    June 25, 2013
   PIMCO    April 22, 2009    December 5, 2008    June 25, 2013
The Small Capitalization Equity Portfolio    IronBridge Capital Management L.P. (“IronBridge”)    November 1,
2004
   May 30, 2008    September
11, 2012
   Frontier Capital Management Company, LLC (“Frontier”)    Inception
(September 5,
1995)
   December 16,
1999
   September
11, 2012
   Pzena Investment Management, LLC (“Pzena”)    April 12, 2010    August 27, 2009    September
11, 2012
   Mellon Capital    August 2, 2013    August 2, 2013    June 25, 2013
   Ariel Investments, LLC (“Ariel”)    August 2, 2013    August 2, 2013    June 25, 2013
   SSgA FM    September 29,
2009
   August 27, 2009    September
11, 2012
   Cupps Capital Management, LLC (“Cupps”)    *    June 6, 2011    September
11, 2012
The Institutional Small Capitalization Equity Portfolio    IronBridge    Inception
(August 15,
2008)
   August 15, 2008    September
11, 2012
   Frontier    Inception
(August 15,
2008)
   August 15, 2008    September
11, 2012
   Pzena    April 12, 2010    August 27, 2009    September
11, 2012
   Mellon Capital    August 2, 2013    August 2, 2013    June 25, 2013
   Ariel Investments, LLC (“Ariel”)    August 2, 2013    August 2, 2013    June 25, 2013
   SSgA FM    September 29,
2009
   August 27, 2009    September
11, 2012
   Cupps Capital Management, LLC (“Cupps”)    June 17, 2011    June 6, 2011    September
11, 2012
The Real Estate Securities Portfolio    Wellington Management Company, LLP (“Wellington Management”)    May 21, 2009    May 14, 2009    December 4,
2012
   Mellon Capital    August 2, 2013    August 2, 2013    June 25, 2013
   SSgA FM    *    September 23,
2011
   September
11, 2012

 

11


The Commodity Returns Strategy Portfolio    Wellington Management    Inception
(June 8, 2010)
   June 2, 2010    December 4, 2012
   PIMCO    Inception
(June 8, 2010)
   June 2, 2010    June 25, 2013
   Mellon Capital    August 2,
2013
   August 2, 2013    June 25, 2013
   SSgA FM    *    September 23,
2011
   September 11, 2012
The International Equity Portfolio    Capital Guardian Trust Company (“CapGuardian”)    April 28,
2000
   May 30, 2008    December 4, 2012
   Artisan Partners Limited Partnership (“Artisan Partners”)    July 23, 1999    May 30, 2008    December 4, 2012

 

12


PORTFOLIO

  

SPECIALIST MANAGER

   SERVED
PORTFOLIO
SINCE
   MOST RECENT
CONTRACT
APPROVAL
SHAREHOLDERS
   MOST RECENT
CONTRACT
APPROVAL BOARD
   Causeway Capital Management LLC (“Causeway”)    May 22, 2006    May 15, 2006    December 4, 2012
   Mellon Capital    August 2, 2013    August 2, 2013    June 25, 2013
   SSgA FM    *    December 18, 2009    September 11, 2012
The Institutional International Equity Portfolio    CapGuardian    Inception
(November 20,
2009)
   November 20, 2009    December 4, 2012
   Artisan    Inception
(November 20,
2009)
   November 20, 2009    December 4, 2012
   Causeway    Inception
(November 20,
2009)
   November 20, 2009    December 4, 2012
   Lazard Asset Management LLC (“Lazard”)    September 27,
2011
   September 23, 2011    December 4, 2012
   Mellon Capital    August 2, 2013    August 2, 2013    June 25, 2013
   SSgA FM    *    November 20, 2009    September 11, 2012
The Emerging Markets Portfolio    SSgA FM (Active)    Inception
(December 10,
2009)
   December 10, 2009    September 11, 2012
   The Boston Company Asset Management LLC (“TBCAM”)    March 16, 2010    December 10, 2009    December 4, 2012
   Mellon Capital    August 2, 2013    August 2, 2013    June 25, 2013
   SSgA FM (Passive)    *    December 10, 2009    September 11, 2012
The Core Fixed Income Portfolio    Mellon Capital Management Corporation (“Mellon Capital”)    December 6, 2010    November 30, 2010    March 12, 2013
   Seix Investment Advisors LLC (“Seix”)    December 6, 2010    November 30, 2010    March 12, 2013
The Fixed Income Opportunity Portfolio    Seix(2)    December 18,
2006
   April 30, 2007    March 12, 2013
   PIMCO    *    January 25, 2010    June 25, 2013
   Fort Washington Investment Advisors, Inc. (“Fort Washington”)    *    April 30, 2012    March 12, 2013
The U.S. Government Fixed Income Securities Portfolio    Mellon Capital    December 6, 2010    November 22, 2010    March 12, 2013
The U.S. Corporate Fixed Income Securities Portfolio    Seix    December 6, 2010    November 22, 2010    March 12, 2013
The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio    Mellon Capital    January 8, 2013    Not Applicable    December 4, 2012
The Short-Term Municipal Bond Portfolio    Breckinridge Capital Advisors, Inc. (“Breckinridge”)    Inception

(March 1, 2006)

   February 28, 2006    March 12, 2013
The Intermediate Term Municipal Bond Portfolio    Standish Mellon Asset Management Company LLC (“Standish”)    December 5, 2008    February 6, 2009    March 12, 2013

 

13


PORTFOLIO

 

SPECIALIST
MANAGER

 

SERVED
PORTFOLIO
SINCE

 

MOST RECENT
CONTRACT
APPROVAL
SHAREHOLDERS

 

MOST RECENT
CONTRACT
APPROVAL
BOARD

The Intermediate Term Municipal Bond II Portfolio   Breckinridge  

Inception

(July 13, 2010)

  July 13, 2010   March 12, 2013

 

* As of the date of this statement of additional information, the Specialist Manager had not yet begun providing investment management services to the applicable Portfolios.
(1) ICAP or its predecessor has served as a Specialist Manager for The Value Equity Portfolio since its inception.
(2) Seix or its predecessor has served as a Specialist Manager for The Fixed Income Opportunity Portfolio since December 18, 2006.

INVESTMENT ADVISORY FEES: The following table sets forth the advisory fees received by the Adviser from each of the Portfolios, calculated at an annual rate of 0.05% of each of the Portfolio’s average daily net assets, for services rendered during the periods indicated (amounts in thousands).

 

    FISCAL YEAR
ENDED
    FISCAL YEAR
ENDED
    FISCAL YEAR
ENDED
 
  June 30, 2012     June 30, 2011     June 30, 2010  

The Value Equity Portfolio

  $ 283      $ 252      $ 256   

The Institutional Value Equity Portfolio

  $ 446      $ 411      $ 280   

The Growth Equity Portfolio

  $ 360      $ 352      $ 388   

The Institutional Growth Equity Portfolio

  $ 531      $ 525      $ 377   

The Small Capitalization Equity Portfolio

  $ 62      $ 67      $ 113   

The Institutional Small Capitalization Equity Portfolio

  $ 91      $ 96      $ 98   

The Real Estate Securities Portfolio

  $ 67      $ 116      $ 75   

The Commodity Returns Strategy Portfolio

  $ 255      $ 119      $ 3 (a) 

The International Equity Portfolio

  $ 561      $ 565      $ 703   

The Institutional International Equity Portfolio

  $ 888      $ 867      $ 442 (b) 

The Emerging Markets Portfolio

  $ 284      $ 235      $ 84 (c) 

The Core Fixed Income Portfolio

  $ 53      $ 110      $ 178   

The Fixed Income Opportunity Portfolio

  $ 264      $ 222      $ 186   

The U.S. Government Fixed Income Securities Portfolio

  $ 133      $ 75 (d)      *   

The U.S. Corporate Fixed Income Securities Portfolio

  $ 109      $ 59 (d)      *   

The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio

  $ 126      $ 71 (d)      *   

The Short-Term Municipal Bond Portfolio

  $ 15      $ 18      $ 17   

The Intermediate Term Municipal Bond Portfolio

  $ 237      $ 261      $ 279   

The Intermediate Term Municipal Bond II Portfolio

  $ 36      $ 30 (e)      *   

 

* The Portfolio was not operational during the period.
(a) For the period June 8, 2010 (commencement of operations) through June 30, 2010.

 

14


(b) For the period November 20, 2009 (commencement of operations) through June 30, 2010.
(c) For the period December 10, 2009 (commencement of operations) through June 30, 2010.
(d) For the period December 6, 2010 (commencement of operations) through June 30, 2011.
(e) For the period July 13, 2010 (commencement of operations) through June 30, 2011.

INVESTMENT ADVISORY FEES: SPECIALIST MANAGERS. In addition to the fees paid by the Trust to the Adviser, each of the Portfolios pays a fee to its Specialist Manager(s). For each Portfolio, the Specialist Managers receive a fee based on a specified percentage of that portion of the Portfolio’s assets allocated to that Specialist Manager. The rate at which these fees are calculated is set forth in the Trust’s Prospectuses.

SPECIALIST MANAGER FEES. In addition to the fees paid by the Trust to the Adviser, each of the Portfolios pays a fee to its Specialist Manager(s). For each Portfolio, the Specialist Managers receive a fee based on a specified percentage of that portion of the Portfolio’s assets allocated to that Specialist Manager. The rate at which these fees are calculated is set forth in the Trust’s Prospectuses. The following table sets forth the actual investment advisory fee received from the specified Portfolio by each of its respective Specialist Managers for services rendered during each of the Trust’s last three fiscal years (amounts in thousands):

 

        

ACTUAL FEES EARNED
FOR FISCAL

YEAR ENDED JUNE 30

 
PORTFOLIO    SPECIALIST MANAGER   2012      2011      2010  

The Value Equity Portfolio

   ICAP(1)   $ 263       $ 398       $ 413   
   SSgA FM(2)   $ 139       $ 75       $ 73   
   AllianceBernstein(3)   $ 374       $ 508       $ 600   
   Mellon Capital(26)   $ —         $ —         $ —     

The Institutional Value Equity Portfolio

   ICAP(1)   $ 458       $ 710       $ 519   
   SSgA FM(2)   $ 202       $ 75       $ 37   
   AllianceBernstein(3)   $ 511       $ 744       $ 603   
   PIMCO(17)   $ 143       $ 333       $ 252   
   Mellon Capital(26)   $ —         $ —         $ —     

The Growth Equity Portfolio

   Jennison(4)   $ 529       $ 670       $ 719   
   SSgA FM(2)   $ 122       $ 64       $ 73   
   SGA(5)   $ 737       $ 974       $ 1,055   
   Mellon Capital(26)   $ —         $ —         $ —     

The Institutional Growth Equity Portfolio

   Jennison(4)   $ 667       $ 889       $ 683   
   SSgA FM(2)   $ 148       $ 58       $ 19   
   SGA(5)   $ 875       $ 1,281       $ 1,009   
   PIMCO(17)   $ 456       $ 458       $ 347   
   Mellon Capital(26)   $ —         $ —         $ —     

The Small Capitalization Equity Portfolio

   Frontier(6)   $ 120       $ 137       $ 259   
   Sterling Johnston Capital
Management. L.P.
(“Sterling Johnston”)
(7)
  $ —         $ 58       $ 296   
   Mellon Capital(8)   $ —         $ —         $ 66   

 

15


   IronBridge(9)   $ 241       $ 299       $ 566   
   Geewax & Partners LLC
(“Geewax”)
(10)
  $ —         $ —         $ 32   
   Pzena(11)   $ 228       $ 218       $ 49   
   SSgA FM(2)   $ 26       $ 50       $ 38   
   Mellon Capital(26)   $ —         $ —         $ —     
   Ariel(27)   $ —         $ —         $ —     
   Cupps(23)   $ —           —           —     

The Institutional Small Capitalization Equity Portfolio

   Frontier(6)   $ 157       $ 174       $ 170   
   Geewax (10)   $ —         $ —         $ 27   
   Sterling Johnston(7)   $ —         $ 89       $ 269   
   Mellon Capital(8)   $ —         $ —         $ 73   
   IronBridge(9)   $ 361       $ 428       $ 484   
   Pzena(11)   $ 366       $ 354       $ 77   
   SSgA FM(2)   $ 19       $ 50       $ 37   
   Mellon Capital(26)   $ —         $ —         $ —     
   Ariel(27)   $ —         $ —         $ —     
   Cupps(23)   $ 268       $ 9         —     

The Real Estate Securities Portfolio

   Wellington
Management
(12)
  $ 911       $ 1,536       $ 1,014   
   SSgA FM(2)     **         **         **   
   Mellon Capital(26)   $ —         $ —         $ —     

The Commodity Returns Strategy Portfolio

   Wellington Management
(Commodity)
(12)
  $ 701       $ 109       $ —     
   Wellington Management
(Global Natural
Resources)
(12)
  $ 1,689       $ 1,834       $ 53   
   PIMCO(17)   $ 446       $ 33       $ —     
   SSgA FM(2)   $ 76         **         **   
   Mellon Capital(26)   $ —         $ —         $ —     

The International Equity Portfolio

   CapGuardian(13)   $ 1,298       $ 1,621       $ 1,598   
   Artisan(14)   $ 1,559       $ 1,259       $ 2,051   
   Causeway(15)   $ 1,514       $ 1,767       $ 2,155   
   SSgA FM(2)   $ 42       $ —         $ —     
   Mellon Capital(26)   $ —         $ —         $ —     

The Institutional International Equity Portfolio

   CapGuardian(13)   $ 1,777       $ 2,383       $ 1,275   
   Artisan(14)   $ 2,407       $ 2,120       $ 994   
   Causeway(15)   $ 2,276       $ 2,667       $ 1,363   
   Lazard(24)   $ 559         **         **   
   SSgA FM(2)   $ 63       $ —         $ —     
   Mellon Capital(26)   $ —         $ —         $ —     

 

16


The Emerging Markets Portfolio

   SSgA FM  (Active)(2)   $ 2,684       $ 3,025       $ 1,180   
   TBCAM(16)   $ 1,498       $ 458       $ 74   
   SSgA FM  (Passive)(2)   $ 7       $ —         $ —     
   Mellon Capital(26)   $ —         $ —         $ —     

The Core Fixed Income Portfolio

   BlackRock(18)   $ 67       $ 357       $ 721   
   Seix(19)   $ 78       $ 44       $   
   Mellon Capital (22)   $ 37       $ 24       $   

The Fixed Income Opportunity Portfolio

   Seix(19)   $  2,104       $  1,838       $  1,572   
   PIMCO(17)   $ —         $ —         $   
   Fort  Washington(25)   $ 51         **         **   

The U.S. Government Fixed Income Securities Portfolio

   Mellon Capital (22)   $ 319       $ 179         *   

The U.S. Corporate Fixed Income Securities Portfolio

   Seix(19)   $ 481       $ 262         *   

The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio

   Blackrock(18)   $ 426       $ 237         *   
   Mellon Capital(22)     **         **         **   

The Short-Term Municipal Bond Portfolio

   Breckinridge(20)   $ 38       $ 45       $ 42   

The Intermediate Term Municipal Bond Portfolio

   Standish(21)   $ 941       $ 1,044       $ 1,116   

The Intermediate Term Municipal Bond II Portfolio

   Breckinridge(20)   $ 91       $ 74         *   

 

* The Intermediate Term Municipal Bond II Portfolio commenced operations on July 13, 2010; The U.S. Government Fixed Income Securities Portfolio, The U.S. Corporate Fixed Income Securities Portfolio and The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio each commenced operations on December 6, 2010.
** The Specialist Manager had not yet begun providing portfolio management services to the Portfolio.
(1) For its services to The Value Equity and The Institutional Value Equity Portfolios, ICAP is compensated at an annual rate of 0.35% of the average net assets of the respective Portfolio assigned to ICAP.
(2) With respect to The Value Equity, The Institutional Value Equity, The Growth Equity and The Institutional Growth Equity Portfolios, SSgA FM is compensated at an annual rate of 0.04% of the average net assets of the respective Portfolio assigned to SSgA FM.

SSgA FM became a Specialist Manager to The Small Capitalization Equity and The Institutional Small Capitalization Equity Portfolios on August 27, 2009 and began managing assets for the Portfolios on September 29, 2009. With respect to The Small Capitalization Equity and The Institutional Small Capitalization Equity Portfolio, SSgA FM is compensated at an annual rate of 0.04% of the average net assets of the respective Portfolio assigned to SSgA FM.

 

17


With respect to the passively managed portion of The International Equity Portfolio, The Institutional International Equity Portfolio and The Commodity Returns Strategy Portfolio, SSgA FM is compensated at an annual rate of 0.06% of the average net assets of the respective Portfolio. SSgA FM had not begun managing assets of The Commodity Returns Strategy Portfolio as of the date of this Statement of Additional Information.

With respect to the passively managed portion of The Real Estate Securities Portfolio, SSgA FM is compensated at an annual rate of 0.12% of the average net assets of the respective Portfolio. SSgA FM had not begun managing assets of The Real Estate Securities Portfolio as of the date of this Statement of Additional Information.

With respect to the actively managed portion of The Emerging Markets Portfolio assigned to SSgA FM, SSgA FM is compensated at an annual rate of 0.85% for the first $50 million of average net assets, 0.75% for the next $50 million in such assets and 0.70% of such assets in excess of $100 million of the average net assets of the Portfolio assigned to SSgA FM.

With respect to passive investment strategy for The Emerging Markets Portfolio, SSgA FM is compensated at an annual rate of 0.16% of the average net assets of the respective Portfolio.

 

(3) AllianceBernstein began serving as a Specialist Manager to The Value Equity and The Institutional Value Equity Portfolios on December 5, 2008 and began managing assets for the Portfolios on December 24, 2008. AllianceBernstein is compensated at an annual rate of 0.38% of the first $300 million in total Combined Assets (see the Specialist Manager section of the Prospectus for the definition of Combined Assets) and 0.37% on such Combined Assets over $300 million. Pursuant to a Fee Waiver Agreement dated October 16, 2009 and the Amendments to the Fee Waiver Agreement dated December 16, 2010, June 30, 2011 and October 1, 2012, AllianceBernstein has contractually agreed to waive the portion of the fee to which it is entitled that exceeds 0.25% of the average daily net assets of the Combined Assets, for the period October 1, 2009 to September 30, 2011 and it will waive that portion of the fee to which it is entitled that exceeds 0.31% of the Portfolio’s average daily net asset value of the Combined Assets for the period from October 1, 2011 through September 30, 2013. Numbers shown reflect contractual fee waivers for the period October 1, 2009 to June 30, 2012.
(4) For its services to The Growth Equity and The Institutional Growth Equity Portfolios, Jennison is compensated for it services to each Portfolio, at an annual rate of 0.75% on the first $10 million of Combined Assets (see the Specialist Manager section of the Prospectus for the definition of Combined Assets), 0.50% on the next $30 million of such Combined Assets; 0.35% of the next $25 million of such Combined Assets; 0.25% on the next $335 million of such Combined Assets; 0.22% of the next $600 million of such Combined Assets; 0.20% on the next $4 billion of such Combined Assets; and 0.25% on the balance of such Combined Assets; subject to a maximum annual fee of 0.30% of the average daily net assets of the portion of the Portfolios allocated to Jennison.
(5) For its services to The Growth Equity and The Institutional Growth Equity Portfolios, SGA is compensated at an annual rate of 0.35% of the average net assets of the respective Portfolios assigned to SGA.
(6) For its services to The Small Capitalization Equity and The Institutional Small Capitalization Equity Portfolios, Frontier is compensated at an annual rate of 0.45% of the average net assets of the respective Portfolios assigned to Frontier.
(7) For its services to The Small Capitalization Equity Portfolio and beginning with the inception of The Institutional Small Capitalization Equity Portfolio, Sterling Johnston was compensated at an annual rate of 0.75% of the average net assets of the respective Portfolios assigned to Sterling Johnston. Sterling Johnston was terminated as a Specialist Manager to each Portfolio as of November 10, 2010.
(8) For its services to The Small Capitalization Equity Portfolio and beginning with the inception of The Institutional Small Capitalization Equity Portfolio, Mellon Capital was compensated at an annual rate of 0.30% of the average net assets of the respective Portfolios assigned to Mellon Capital. Mellon Capital was terminated as a Specialist Manager to each Portfolio as of March 26, 2010.
(9) For its services to the Small Capitalization Equity Portfolio and beginning with the inception of The Institutional Small Capitalization Equity Portfolio, IronBridge is compensated at an annual rate of 0.95% of the average net assets of the respective Portfolios assigned to IronBridge.

 

18


(10) Geewax or its predecessor has served as a Specialist Manager for The Small Capitalization Equity Portfolio since April 1, 1998. Formerly known as Geewax, Terker & Co., (“Geewax Terker”) the firm served pursuant to a Portfolio Management Contract between Geewax Terker and the Trust first approved by shareholders of The Small Capitalization Equity Portfolio on June 15, 1998. Geewax was terminated as a Specialist Manager to each Portfolio as of October 19, 2009. For its services to The Small Capitalization Equity and The Institutional Small Capitalization Equity Portfolios, Geewax was entitled to receive a fee calculated at an annual rate of 0.30% of the average net assets of the respective Portfolios assigned to Geewax. Numbers shown reflect voluntary fee waivers.
(11) Pzena became a Specialist Manager to The Small Capitalization Equity and The Institutional Small Capitalization Equity Portfolios on August 27, 2009 and began managing assets for the Portfolios on April 12, 2010. For its services to The Small Capitalization Equity and The Institutional Small Capitalization Equity Portfolios, Pzena is compensated at an annual rate of 1.00% of the average net assets of the respective Portfolio assigned to Pzena.
(12) For its services to The Real Estate Securities Portfolio, Wellington Management is compensated at an annual rate of 0.75% on the first $50 million of the average daily net Combined Assets (see the Specialist Manager section of the Prospectus for the definition of Combined Assets) and 0.65% on Combined Assets over $50 million. Wellington Management became a Specialist Manager to The Commodity Returns Strategy Portfolio on June 2, 2010 and began managing assets of the Portfolio on June 8, 2010. With respect to The Commodity Returns Strategy Portfolio, for assets managed in its Global Natural Resources strategy, Wellington Management receives a fee at an annual rate of 0.85% of the average daily net assets of that portion of the Portfolio’s assets allocated to such strategy so long as there are at least $50 million in assets present in such account and 1.00% if less than $50 million are present in the account. Wellington Management has waived the $50 million minimum assets level for the first six months of the Portfolio’s operations. For assets managed in its Commodity strategy, Wellington Management receives a fee at an annual rate of 0.75% of the average daily net assets of that portion of the Portfolio’s assets allocated to such strategy.
(13) For its services to The International Equity Portfolio and beginning with the inception of The Institutional International Equity Portfolio, CapGuardian is compensated at an annual rate of 0.70% for the first $25 million of the average of the month-end net asset values of the CapGuardian account during the quarter, 0.55% for the next $25 million, 0.425% for the next $200 million in such assets and 0.375% for those assets in excess of $250 million. There is a minimum annual fee of $312,500 based upon an account size of $50 million. The following fee discounts will be applied based upon the total annualized aggregate fees (include other assets managed by CapGuardian); 5% discount on fees from $1.25 million to $4 million; 7.5% discount on fees from $4 million to $8 million; 10% discount on fees from $8 million to $12 million; and 12.5% discount on fees over $12 million. When the total aggregate fees exceed $3 million, before discounts, fee break points are to be eliminated and the Portfolios will pay a fee at an annual rate of 0.375% on all assets in the Portfolios managed by CapGuardian.
(14) For its services to The International Equity Portfolio and beginning with the inception of The Institutional International Equity Portfolio, Artisan is compensated at an annual rate of 0.47% of the average net assets of the respective Portfolios allocated to Artisan, so long as the combined assets of the Portfolios are greater than $500 million. If the combined assets of the Portfolios are reduced to $500 million or less, Artisan is compensated at an annual rate of 0.80% of average net assets for the first $50 million of the respective Portfolio assets allocated to Artisan, 0.60% for the next $50 million in such assets, and 0.70% for such assets over $100 million.
(15) Causeway is compensated at an annual rate of 0.45% of the average net assets of The International Equity and The Institutional International Equity Portfolios allocated to Causeway.
(16) For its services to The Emerging Markets Portfolio, TBCAM is compensated at an annual rate of 0.90% of average net assets for the first $50 million in Portfolio assets, 0.85% for the next $50 million in such assets, 0.70% for the next $100 million in such assets and 0.60% for such assets over $200 million.
(17) For its services to The Institutional Value Equity Portfolio and The Institutional Growth Equity Portfolio, PIMCO is compensated at an annual rate of 0.25% of the average net assets of each Portfolio assigned to PIMCO. Shareholders of The Fixed Income Opportunity Portfolio approved a Portfolio Management Agreement between PIMCO and the Trust with respect to The Fixed Income Opportunity Portfolio on January 25, 2010. As of the date of this statement of additional information, PIMCO had not begun providing portfolio management services to The Fixed Income Opportunity Portfolio. PIMCO entered into an agreement to serve as a Specialist Manager to The Commodity Returns Strategy Portfolio on June 2, 2010 and began managing assets on June 8, 2010. With respect to The Commodity Returns Strategy Portfolio, PIMCO is compensated at an annual rate of 0.49% of that portion of the Portfolio allocated to PIMCO.

 

19


(18) For its services to The Core Fixed Income Portfolio and The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio, BlackRock is entitled to receive a fee of 0.175% of the average daily net assets of the first $200 million of the Combined Assets (as defined below) of that portion of the Portfolio allocated to BlackRock and 0.15% of those Combined Assets exceeding $200 million. For purposes of computing BlackRock’s fee for the two Portfolios, the term “Combined Assets” shall mean the consolidated total amount of the assets managed by BlackRock in each of The Core Fixed Income Portfolio and The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio and certain other assets managed by BlackRock for clients of Hirtle Callaghan and Co., LLC. Effective January 8, 2013, the investment advisory relationship between the Trust and BlackRock Financial Management, Inc. with respect to The Core Fixed Income Portfolio and The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio has been terminated.
(19) For its services to The Fixed Income Opportunity Portfolio Seix receives a fee, based on the average daily net asset value of the assets of the Portfolio under its management at an annual rate of 0.40% for the first $100 million of the Combined Assets (as defined below), 0.25% on the next $200 million of the Combined Assets, and 0.20% on the balance of the Combined Assets. For the purpose of computing Seix’s fee for The Fixed Income Opportunity Portfolio, the term “Combined Assets” shall mean the sum of (i) the net assets of the Portfolio; and (ii) the net assets of each other Hirtle Callaghan account to which Seix provides similar services. For its services to The Core Fixed Income Portfolio and The U.S. Corporate Fixed Income Securities Portfolio, Seix receives a fee, based on the average daily net asset value of the assets of the Portfolios under its management at an annual rate of 0.25% of the first $100 million in such Combined Assets (as defined below) of that portion of the Portfolio allocated to Seix and 0.20% of for those Combined Assets exceeding $100 million. For purposes of computing Seix’s fee for the two Portfolios, the term “Combined Assets” shall mean the consolidated total amount of the assets managed by Seix in each of The Core Fixed Income Portfolio and The U.S. Corporate Fixed Income Securities Portfolio.
(20) For it services to The Intermediate Term Municipal Bond II Portfolio and The Short Term Municipal Bond Portfolio, Breckinridge is compensated at an annual rate of 0.125% of the average net assets of each Portfolio. Breckinridge became a Specialist Manager and began providing investment management serves to The Intermediate Term Municipal Bond II Portfolio on July 13, 2010.
(21) For its services to The Intermediate Term Municipal Bond Portfolio, Standish is compensated at the annual rate of 0.25% for the first $100 million of the “Combined Assets” of that portion of the Portfolio allocated to Standish and 0.15% of those Combined Assets (as defined below) exceeding $100 million, subject to a maximum annual fee of 0.20% of the average daily of net assets of the Portfolio. For the purposes of computing Standish’s fee for the Portfolio, the term “Combined Assets” shall mean the consolidated total amount of the assets managed by Standish in The Intermediate Term Municipal Bond Portfolio and certain other assets managed by Standish for clients of Hirtle Callaghan and Co., LLC.
(22) For it services to The Core Fixed Income Portfolio and The U.S. Government Fixed Income Securities Portfolio, Mellon Capital is compensated at an annual rate of 0.12% of the average net assets of the Portfolio. Effective September 1, 2012, Mellon Capital receives a fee, based on the average daily net asset value of that portion of the assets of the Portfolios managed by it, at an annual rate of 0.06%. For its services to The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio Mellon Capital receives a fee based on the average daily net asset value of that portion of the assets of the Portfolios managed by it, at an annual rate of 0.06%.
(23) For its services to The Small Capitalization Equity Portfolio and The Institutional Small Capitalization Equity Portfolio, Cupps receives a fee based on the average daily net asset value of that portion of each Portfolio allocated to it, at an annual rate of 0.85%.
(24) For its services to The Institutional International Equity Portfolio, Lazard receives at the annual rate of 0.45% of the average daily net assets of the first $100 million 0.40% on assets between $100 million and $250 million and 0.375% on the excess over $250 million of that portion of the assets of the Portfolio that may, from time to time be allocated to Lazard, Lazard had not begun managing assets of The Institutional International Equity Portfolio as of the date of this Statement of Additional Information.
(25) For its services to The Fixed Income Opportunity Portfolio, Fort Washington receives a fee at the annual rate of 0.40% of the first $25 million of the Combined Assets (as defined below) that may, from time to time, be allocated to it by the Adviser, 0.375% of the next $25 million, 0.3375% of the next $50 million, 0.25% of the next $100 million and 0.20% on all assets allocated to Fort Washington if the average daily net assets exceeds $200 million. For the purposes of computing Fort Washington’s fee for the Portfolio, the term “Combined Assets” shall mean the consolidated total amount of the assets managed by Fort Washington in The Fixed Income Opportunity Portfolio and certain other assets managed by Fort Washington for clients of Hirtle Callaghan and Co., LLC.

 

20


(26) For its services to The Value Equity Portfolio, The Institutional Value Equity Portfolio, The Growth Equity Portfolio, The Institutional Growth Equity Portfolio, The Small Capitalization Equity Portfolio, The Institutional Small Capitalization Equity Portfolio, The Real Estate Securities Portfolio, The Commodity Returns Strategy Portfolio, The International Equity Portfolio, The Institutional International Equity Portfolio and The Emerging Markets Portfolio (the “Equity Portfolios”), Mellon Capital receives fees for each of the Equity Portfolios, calculated based on an annual percentage of average daily net assets. Mellon Capital’s fees would be paid at one level so long as the aggregate assets allocated to Mellon Capital for all of its passive equity mandates (including accounts for other clients of the Adviser and its affiliates besides the Trust) exceed $2 billion. Should these aggregate assets fall below $2 billion, a higher fee will apply. Mellon Capital did not Manage assets for any of these Portfolios during the periods shown in the table.
(27) For its services to The Small Capitalization Equity Portfolio and The Institutional Small Capitalization Equity Portfolio, Ariel will be paid an annual fee, calculated daily and payable quarterly, in arrears, based on the Combined Assets (as defined below), in accordance with the following schedule: 1.00% of the first $10 million of the Combined Assets, 0.75% of the next $10 million and 0.50% of Combined Assets exceeding $20 million. Ariel did not Manage assets for either of these Portfolios during the periods shown in the table.

ADMINISTRATION, DISTRIBUTION, AND RELATED SERVICES. Citi Fund Services Ohio, Inc. (“Citi”), 3435 Stelzer Road, Columbus, Ohio 43219 has been retained, pursuant to a separate Administrative Services Contract with the Trust, to serve as the Trust’s administrator. Citi performs similar services for mutual funds other than the Trust. Citi is owned by Citibank, N.A. Citibank, N.A. and its affiliated companies are wholly owned subsidiaries of Citigroup Inc., a publicly held company (NYSE: C).

Services performed by Citi include: (a) general supervision of the operation of the Trust and coordination of services performed by the various service organizations retained by the Trust; (b) regulatory compliance, including the compilation of information for documents and reports furnished to the SEC and corresponding state agencies; (c) assistance in connection with the preparation and filing of the Trust’s registration statement and amendments thereto; and (d) maintenance of the Trust’s registration in the various states in which shares of the Trust are offered. Pursuant to separate contracts, Citi or its affiliates also serve as the Trust’s transfer and dividend disbursing agent, as well as the Trust’s accounting agent and receives fees for such services. For its services, Citi receives a single all-inclusive fee (“Omnibus Fee”). The Omnibus Fee, which is computed daily and paid monthly in arrears, is calculated at an annual rate of 0.054% of the Portfolios’ average daily net assets up to $6 billion; and 0.005% of the Portfolios’ average daily net assets in excess of $6 billion.

For the fiscal years ended June 30, 2010, 2011 and 2012 Citi, as Administrator received administration fees in the following amounts for each of the Portfolios (amounts in thousands):

 

     FISCAL YEAR
ENDED
June 30, 2012
     FISCAL YEAR
ENDED
June 30, 2011
     FISCAL YEAR
ENDED
June 30, 2010
 

The Value Equity Portfolio

   $ 206       $ 188       $ 229   

The Institutional Value Equity Portfolio

   $ 325       $ 308       $ 242   

The Growth Equity Portfolio

   $ 260       $ 263       $ 348   

The Institutional Growth Equity Portfolio

   $ 383       $ 393       $ 328   

The Small Capitalization Equity Portfolio

   $ 45       $ 50       $ 105   

The Institutional Small Capitalization Equity Portfolio

   $ 66       $ 72       $ 88   

The Real Estate Securities Portfolio

   $ 48       $ 87       $ 63   

The Commodity Returns Strategy Portfolio

   $ 184       $ 87       $ 2 (a) 

The International Equity Portfolio

   $ 405       $ 423       $ 649   

The Institutional International Equity Portfolio

   $ 641       $ 651       $ 372 (b) 

 

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The Emerging Markets Portfolio

   $ 204       $ 175      $ 67 (c) 

The Core Fixed Income Portfolio

   $ 38       $ 86      $ 157   

The Fixed Income Opportunity Portfolio

   $ 189       $ 166      $ 164   

The U.S. Government Fixed Income Securities Portfolio

   $ 96       $ 53 (d)      *   

The U.S. Corporate Fixed Income Securities Portfolio

   $ 79       $ 42 (d)      *   

The U.S. Mortgage/Asset Backed Fixed Income Securities Portfolio

   $ 91       $ 50 (d)      *   

The Short-Term Municipal Bond Portfolio

   $ 11       $ 13      $ 15   

The Intermediate Term Municipal Bond Portfolio

   $ 171       $ 197      $ 246   

The Intermediate Term Municipal Bond II Portfolio

   $ 26         22 (e)      *   

 

* The Portfolio had not commenced operations during the fiscal year.
(a) For the period June 8, 2010 (commencement of operations) through June 30, 2010.
(b) For the period November 20, 2009 (commencement of operations) through June 30, 2010.
(c) For the period December 10, 2009 (commencement of operations) through June 30, 2010.
(d) For the period December 6, 2010 (commencement of operations) through June 30, 2011.
(e) For the period July 13, 2010 (commencement of operations) through June 30, 2011.

Under a Compliance Services Agreement between the Trust and Citi, Citi provides infrastructure and support in implementing the written policies and procedures comprising the Trust’s compliance program. This includes providing support services to the Chief Compliance Officer (“CCO”), and assisting in preparing or providing documentation for the Trust’s CCO, to deliver to the Board.

Unified Financial Securities, Inc. (“Unified”) serves as the Trust’s principal underwriter pursuant to an agreement approved by the Board on March 13, 2012. Unified is a wholly-owned subsidiary of Huntington Bancshares, Inc. Because shares of the Trust’s Portfolios are available only to clients of the Adviser and financial intermediaries that have established a relationship with the Adviser, the services to be provided by Unified are limited. Unified will receive an annual fee of $50,000 for performing the services listed under its agreement. The offices of the principal underwriter are located at 2960 North Meridian St., Suite 300, Indianapolis, IN, 46208. None of Unified’s duties under its agreement are primarily intended to result in the sale of Trust shares.

Alaric Compliance Services LLC (“Alaric”), 800 Third Ave., 11th Floor, New York, NY, 10022 provides CCO services to the Trust and its Portfolios pursuant to a Compliance Services Agreement. Alaric makes an Alaric employee available to serve as the CCO for the Trust. The CCO develops the reports for the Board, makes findings and conducts reviews pertaining to the Trust’s compliance program and related policies and procedures of the Trust’s service providers.

State Street Bank and Trust Company is the Trust’s custodian and is an affiliate of SSgA FM, which serves as a Specialist Manager for the Value Equity, Growth Equity, Small Capitalization Equity, International Equity, Emerging Markets, Institutional Value Equity, Institutional Growth Equity, Institutional Small Capitalization Equity, Institutional International Equity, Real Estate Securities and Commodity Returns Strategy Portfolios. The custodian is responsible for the safekeeping of the domestic and foreign assets of each of the Trust’s Portfolios. The custodian is compensated at the rate of 0.01% of the first $2 billion, 0.0075% of the next $3 billion, and 0.005% of the assets in excess of $5 billion of the Trust’s domestic assets, 0.0225% of the Trust’s foreign assets in developed countries. With respect to securities from emerging markets, the custodian is compensated at rates ranging from 0.07% to 0.50% depending upon the particular market in question. The offices of the custodian are located at State Street Financial Center, 1 Lincoln Street, Boston, MA 02111.

HC Advisors Shares Marketing and Service Plan. Under the Trust’s Marketing and Service Plan (the “12b-1 Plan), the Trust can pay to the Adviser a fee of up to 0.25% annually of the average daily net assets attributable to HC Advisors Shares. The fee is not tied exclusively to actual expenses incurred by the Adviser in performing the services set forth below and the fee may exceed then such expenses. The Plan Fee shall be calculated daily based upon the average daily net assets of each Portfolio attributable to such Portfolio’s HC Advisors Shares, and such fee shall be charged only to such HC Advisors Shares.

The fee is intended to compensate the Adviser for expenses associated with the (i) oversight and coordination of those organizations, including the Administrator, Transfer Agent, Fund Accounting Agent and principal underwriter (collectively, “Service Organizations”) retained by the Trust in connection with the distribution of shares of the HC Advisors Shares to Third Party Institutions that will, in turn, hold shares of one or more of the HC Advisors Shares for the benefit of their Discretionary Clients; and

 

22


(ii) the provision of shareholder services to such Third Party Institutions. Such oversight, coordination and shareholder services may include, but are not limited to, the following: (1) services associated with the provision of prospectuses, statements of additional information, any supplements thereto and shareholder reports relating to the HC Advisors Shares and to be provided to Third Party Institutions; (2) obtaining information and providing explanations to Third Party Institutions (and, if requested to do so by a Third Party Institution that would be permitted to acquire shares of the HC Advisors Shares as outlined in the Section 1 and if acceptable to the Adviser, to Discretionary Clients of such institutions) regarding the investment objectives and policies of the respective Portfolios, as well as other information appropriate information about the HC Advisors Shares and the Portfolios; (3) coordination and oversight of the accounting and record-keeping processes as they relate to the HC Advisors Shares and responding in inquires from Third Party Institutions that are holder of record of shares of HC Advisors Shares through “f/b/o” or “omnibus accounts” and coordination of administrative services for the HC Advisors Shares (e.g. in connection with proxy solicitations; distribution of periodic shareholders reports); and compliance with applicable regulations as they related to HC Advisors Shares (e.g. Rule 22c-2 and anti-money laundering procedures); (4) any other activity that the Board determines is primarily intended to result in the sale of shares of HC Advisors Shares or to provide appropriate services to a Third Party Institution.

The 12b-1 Plan was approved by the Board on December 10, 2009 and not operational during the most recent fiscal year. Accordingly, no payments under the 12b-1 Plan were made by the Trust during the last fiscal year.

FURTHER INFORMATION ABOUT THE TRUST’S INVESTMENT POLICIES

As stated in the Prospectuses, the Trust currently offers nineteen portfolios, each of which are presented in this Statement of Additional Information, each with its own investment objectives and policies. These portfolios are: The Equity Portfolios —The Value Equity, Growth Equity, Small Capitalization Equity, Real Estate Securities, International Equity, Emerging Markets Portfolios and Commodity Returns Strategy Portfolios; The Institutional Equity Portfolios—The Institutional Value Equity, Institutional Growth Equity, Institutional Small Capitalization Equity, Institutional International Equity; U.S. Government Fixed Income Securities, U.S. Corporate Fixed Income Securities and U.S. Mortgage/Asset Backed Fixed Income Securities Portfolios; and The Income Portfolios — The Core Fixed Income, Fixed Income Opportunity, Short-Term Municipal Bond, Intermediate Term Municipal Bond and Intermediate Term Municipal Bond II Portfolios.

The following discussion supplements the prospectus discussion of the investment risks associated with the types of investments in which the Portfolios are entitled to invest. The table below summarizes these investments. The table is, however, only a summary list and is qualified in its entirety by the more detailed discussion included in the Prospectuses and in this Statement of Additional Information.

Further, as indicated in the Prospectuses, that portion of the assets of the Value Equity, Growth Equity, Small Capitalization Equity, International Equity, Institutional Value Equity, Institutional Growth Equity, Institutional Small Capitalization, Institutional International Equity, Real Estate Securities and Commodity Related Securities Portfolios (“Index Accounts”) that have been or may be allocated to SSgA FM and the indexing strategy that SSgA FM has been retained to provide, may be invested exclusively in securities included in the benchmark index associated with those Portfolios, respectively, provided that SSgA FM is authorized to and may use certain derivative instruments solely for the purpose of gaining market exposure consistent with such index strategy and provided further that the Index Accounts may temporarily hold non-index names due to corporate actions (i.e., spin-offs, mergers, etc.). SSgA FM has also been allocated portions of The Emerging Markets Portfolio to manage with both an active management and a passive or index-based strategy. With respect to the “index-based” mandate, SSgA FM may be invested exclusively in securities included in the benchmark index associated with that Portfolio, provided that SSgA FM is authorized to and may use certain derivative instruments solely for the purpose of gaining market exposure consistent with such index strategy and provided further that the Index Accounts may temporarily hold non-index names due to corporate actions (i.e., spin-offs, mergers, etc.).

Additionally, to enable The Commodity Returns Strategy Portfolio to achieve its investment objective through commodity, economic and investment cycles, the Portfolio seeks to augment its equity returns by reinforcing the Specialist Managers’ commodity views via exposure to commodity-linked structured notes. The Portfolio may also anticipate future investments in equities by investing in options and futures contracts. The Portfolio may focus on the securities of particular issuers or industries within the commodity-related industries in which the Portfolio invests, or in particular countries or regions, at different times. The Portfolio intends to gain exposure to the commodity markets in part by investing a portion of its assets in two wholly-owned subsidiaries organized under the laws of the Cayman Islands (the “Subsidiaries”). Among other investments, the Subsidiaries are expected to invest in commodity-linked derivative instruments, such as swaps and futures. The Subsidiaries have the same investment objective and will generally be subject to the same fundamental, non-fundamental and certain other investment restrictions as the Portfolio; however, the Subsidiaries (unlike the Portfolio) may invest without limitation in commodities, commodity-linked swap agreements and other commodity linked derivative instruments as well as make short sales of securities, maintain a short position or purchase securities on margin within the

 

23


context of a total portfolio of investments designed to achieve the Portfolio’s objectives. The Portfolio and the Subsidiaries may test for compliance with certain investment restrictions on a consolidated basis. The Subsidiaries must, however, comply with the asset segregation requirements (described elsewhere in the SAI) with respect to its investments in commodity-linked swaps and other commodity-linked derivatives as well as short sales. By investing in the Subsidiaries, the Portfolio is indirectly exposed to the risks associated with the Subsidiaries’ investments.

 

24


The Equity and Institutional Equity Portfolios

 

Investment Instrument/Strategy

   Value   Growth   Small
Cap
  Real
Estate
  Int’l   Emerging
Markets
  Inst.
Value
   Inst.
Growth
   Inst.
Small
Cap
  Inst.
Int’l
  Commodity

ADRs, EDRs and GDRs

   x   x   x   x   x   x   x    x    x   x   x

Agencies

   *   *   *   *   *   *   x    x    *   *   x

Asset-Backed Securities

   -   -   -   -   -   -   x    x    -   -   x

Cash Equivalents

   *   *   *   *   *   *   x    x    *   *   x

Collateralized Mortgage Obligations

   -   -   -   -   -   -   x    x    -   -   x

Commercial Paper

   *   *   *   *   *   *   x    x    *   *   x

Commodity-Linked Derivatives

   -   -   -   -   -   -   -    -    -   -   x

Common Stock

   x   x   x   x   x   x   x    x    x   x   x

Convertibles

   x   x   x   x   x   x   x    x    x   x   x

Corporates

   -   -   -   -   -   -   x    x    -   -   x

Depositary Receipts

   x   x   x   x   x   x   x    x    x   x   x

Emerging Markets Securities

   x   x   x   x   x   x   x    x    x   x   x

Floaters

   *   *   *   -   *   *   x    x    *   *   x

Foreign Currency

   -   -   -   x   x   x   x    x    -   x   x

Foreign Equity (US $)

   x   x   x   x   x   x   x    x    x   x   x

Foreign Equity (non-US $)

   x   x   x   x   x   x   x    x    x   x   x

Foreign Fixed-Income Securities

   -   -   -   -   -   -   x    x    -   -   x

Forwards

   **   **   **   x   **   **   x    x    **   **   x

Futures

   **   **   **   **   **   **   x    x    **   **   x

High Yield Debt Securities

   -   -   -   x   -   -   -    -    -   -   -

Investment Companies

   x   x   x   x   x   x   x    x    x   x   x

Investment Grade Debt Securities

   -   -   -   x   -   -   x    x    -   -   x

Money Market Funds

   x   x   x   x   x   x   x    x    x   x   x

Mortgage-Backed Securities

   -   -   -   x   -   -   x    x    -   -   x

 

25


Investment Instrument/Strategy

  Value   Growth   Small
Cap
  Real
Estate
  Int’l   Emerging
Markets
  Inst.
Value
  Inst.
Growth
  Inst.
Small
Cap
  Inst.
Int’l
  Commodity

Mortgage Securities

  -   -   -   -   -   -   x   x   -   -   x

Municipals

  -   -   -   -   -   -   x   x   -   -   x

Options

  **   **   **   x   **   **   x   x   **   **   x

Preferred Stock

  x   x   x   x   x   x   x   x   x   x   x

REITs

  x   x   x   x   x   x   x   x   x   x   x

Repurchase Agreements

  *   *   *   *   *   *   x   x   *   *   x

Reverse Repurchase Agreements

  *   *   *   *   *   *   x   x   *   *   x

Rights

  x   x   x   x   x   x   x   x   x   x   x

Securities Lending

  x   x   x   x   x   x   x   x   x   x   x

Short Sales

  **   **   **   **   **   **   **   **   **   **   **

Step-Up Bonds

  -   -   -   -   -   -   x   x   -   -   x

Stripped Mortgage-Backed Securities

  -   -   -   -   -   -   x   x   -   -   x

Structured Notes

  x   x   x   -   x   x   x   x   x   x   x

Swaps

  x   x   x   -   x   x   x   x   x   x   x

TIPS

  -   -   -   -   -   -   x   x   -   -   x

U.S. Governments

  *   *   *   *   *   *   x   x   *   *   x

Warrants

  x   x   x   x   x   x   x   x   x   x   x

When-Issued Securities

  x   x   x   x   x   x   x   x   x   x   x

Yankees and Eurobonds

  -   -   -   -   -   -   x   x   -   -   x

Zero Coupon Agencies

  -   -   -   -   -   -   x   x   -   -   x

 

26


The Income Portfolios:

 

Investment Instrument/Strategy

  Core
Fixed
  Fixed
Inc.

Oppy.
  U.S.
Govt.
  U.S.
Corporate
  U.S.
Mortgage/Asset
Backed
  Short-
Term
  Interm.   Intermediate
Term II

Agencies

  x   x   x   x   x   x   x   x

Asset-Backed Securities

  x   x   -   -   x   x   x   x

Brady Bonds

  x   x   -   -   -   -   -   -

Cash Equivalents

  x   x   x   x   x   x   *   *

Collateralized Bond Obligations

  -   x   -   -   x   -   -   -

Collateralized Debt Obligations

  -   x   -   -   x   -   -   -

Collateralized Loan Obligations

  -   x   -   -   x   -   -   -

Collateralized Mortgage Obligations

  x   x   -   -   x   -   -   -

Commercial Paper

  x   x   x   x   x   x   *   *

Commodity-Linked Derivatives

  -   -   -   -   -   -   -   -

Convertibles

  x   x   -   -   -   -   -   -

Corporates

  x   x   -   x   -   -   -   -

Depositary Receipts

  x   x   -   x   x   -   -   -

Emerging Markets Securities

  -   x   -   -   -   -   -   -

Floaters

  x   x   -   -   -   -   -   x

Foreign Currency

  x   x   -   x   -   -   -   -

Foreign Equity (US $)

  -   x   -   -   -   -   -   -

Foreign Equity (non-US $)

  -   x   -   -   -   -   -   -

Foreign Fixed Income Securities

  x   x   -   -   -   -   -   -

Mortgage Securities

  x   x   -   -   x   x   x   x

Forwards

  x   x   -   -   -   -   -   -

Futures

  x   x   -   -   x   x   -   -

High Yield Securities

  x   x   -   -   -   -   -   -

Inverse Floaters

  x   x   -   -   -   -   -   -

Investment Companies

  x   x   x   x   x   x   x   x

Loan (Participations and Assignments)

  -   x   -   -   x   x   -   -

Municipals

  x   x   -   x   -   x   x   x

Options

  x   x   -   -   x   x   -   -

 

27


Investment Instrument/Strategy

  Core
Fixed
  Fixed
Inc.

Oppy.
  U.S.
Govt.
  U.S.
Corporate
  U.S.
Mortgage/Asset
Backed
  Short-
Term
  Interm.   Intermediate
Term II

Preferred Stock

  x   x   -   x   -   -   -   -

REITS

  -   x   -   -   -   -   -   -

Repurchase Agreements

  *   *   *   *   *   *   *   *

Reverse Repurchase Agreements

  *   *   *   *   *   *   *   *

Rights

  x   x   -   -   -   -   -   -

Stripped Mortgage-Backed Securities

  x   x