DRIEHAUS EMERGING MARKETS SMALL CAP GROWTH FUND

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1 DRIEHAUS EMERGING MARKETS SMALL CAP GROWTH FUND April 2015 Summary Ticker: DRESX Fund objective: Provide risk-adjusted returns and down-market capture ratios superior to the MSCI EM Small Cap Index over full market cycles Overview: A growth equity approach to EM small cap equities The fund seeks a lower risk profile through hedging Same portfolio management team since the fund s inception I am not big on emoticons. When a friend ed me during the NCAA tournament using the above string of characters to describe Notre Dame s clock management strategy, my first reaction was to think that perhaps it was the result of a fat finger or from imbibing one too many adult beverages as he watched the games. But inevitably, curiosity got the best of me and I turned to the Internet, where I discovered that this symbol is known as the shruggie. Exhibit 1: The Costanza shruggie A long-bias fund with a net exposure generally 60-90%, ex-cash Investment universe: Emerging markets small cap equity and derivatives Fund AUM: $638 million Inception date: December 1, 2008* Ticker: DRESX Portfolio managers: Chad Cleaver, CFA Lead Portfolio Manager 13 years experience Howard Schwab Co-Portfolio Manager 14 years experience Trent DeBruin, CFA Assistant Portfolio Manager 9 years experience Source: imdb.com As emerging market investors review their April performance, undoubtedly the strong performance of the Chinese equity market will be top of mind. Strictly looking at the performance of the economy, one s kneejerk response might be something akin to the George Costanza shruggie. Many economic indicators, such as value added of industry, are trending at their weakest growth rates since 2008 (Exhibit 2). *The Fund s predecessor limited partnership has an inception date of 12/1/2008. Exhibit 2: China Value Added of Industry, year-on-year % Source: Bloomberg 1

2 Chinese equities have been supported by policy and liquidity. While the backdrop of tepid growth and slowing fixed asset investment in areas such as property and manufacturing carries negative ramifications for global growth, it also creates a condition in which policymakers grow more willing to support the economy. Targeted investments in the power grid and rail infrastructure, health care, technology, and the environment are one component of such policies. Importantly, liquidity injections have been and will likely remain a big focus of the PBOC (People s Bank of China). When considering this policy environment, perhaps the Michael Jordan shruggie is really the more apt characterization of China s recent performance. Exhibit 3: The Jordan shruggie Source: galleryhip.com Amid China s current bull market, the performance of commodity prices and global growth proxies has been more mixed. This results from meaningful mining capex in recent years, along with a continued slowdown in fixed asset investment in China. While base metals and bulk commodities have bounced off of their recent lows, those looking for a major inflection in commodities may find themselves doing the W shruggie. Exhibit 4: The W shruggie Source: mashable.com 2

3 On the Road Again In recent weeks, Co-Portfolio Manager Howie Schwab and Assistant Portfolio Manager Trent DeBruin traveled throughout Asia and Africa, meeting with management teams and policymakers. They returned with some interesting stock ideas and macro insights, which are summarized below. Taiwan Businesses in many developing economies have struggled to adapt to the new global economy, however numerous Taiwanese corporations have fared well. While Korean small and medium-sized enterprises are overly reliant on behemoths like Samsung, and hence lack innovation, the Taiwanese supply chain has managed to successfully integrate itself with dynamic global companies, including Apple, Tesla, and Nike. Part of the Taiwanese success story reflects the ability to provide technological quality and reliability at competitive prices; however strong capital management has also enhanced the attractiveness of many Taiwanese companies to minority shareholders. Given that we see significant medium-term potential for the Taiwanese stock market and elevated dispersion among Taiwanese investment opportunities, we recently visited Taipei to visit several companies. A number of our meetings focused on the technology sector and included companies that make camera lenses or metal casings for smartphones, as well as sensors for the Internet of Things (IoT). While pricing pressure from clients like Apple remains a reality, at this point product reliability and yield have become increasingly important as players like Apple cannot afford to squeeze supply chains much further without jeopardizing the quality of their products. Our channel checks indicate a growing short-term risk for commoditized technology components, as large semiconductor companies suggested a worsening seasonal inventory build. However, new technologies are emerging for 2016 and beyond, with IoT and System-in-Package (SiP) representing two of the more interesting themes we encountered. Additionally, the ongoing need to differentiate increasingly competitive mass-market products like smartphones means that high-end component players continue to see sustained demand for pixel migration in smartphone cameras. While technology historically has been the hallmark of the Taiwanese market, other dynamic businesses have thrived in areas outside of tech. For example, during meetings with a high-end textile maker, we learned about how the company is growing market share with clients such as H&M, Walmart and Carter s. Though textile production is often considered a basic business, the advent of performance-sportswear by companies like Nike and Lululemon demonstrate that fabric manufacturing is no longer a commoditized business. Two of the leading local textile manufacturers excel in producing more sophisticated fabrics and have benefited from early moves in shifting textile production away from China and into more cost-competitive markets like Vietnam and Cambodia. During our interactions, we learned that current efforts are focused on moving fabric facilities closer to the processing centers to improve vertical integration at the Vietnamese facilities. Aside from the garment companies, we also met with a number of companies in other promising areas. Specialized bicycles are being produced by Taiwanese companies and sales are benefiting from a renewed emphasis on healthy/sporty lifestyles globally, particularly within Asia. Additionally, we attended several larger presentations by companies producing niche parts for electric vehicles including various Tesla models. Taiwanese companies have equipped themselves to benefit from the trend changes being seen throughout the world. Whether lowering heat dissipation in technology devices for Apple, facilitating data analysis within smart cities in China, or producing a more breathable jogging shirt for Nike, Taiwanese companies represent compelling opportunities for EM investors within a quickly changing economic model. 3

4 Exhibit 5: Correlation of Apple vs. Taiwan Apple plays Apple MarketCap (LHS US$B) Taiwan Apple Play Mkt Cap (RHS - TWD$B) ~2015 YTD correlation =91.7% Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar Source: CMoney, Fubon Research estimates as of close on March 19, 2015 Exhibit 6: Taiwan Stock Exchange (Taiex) corporate operating margin trend (forecast) TWSE_OpMargin Source: CMoney, Fubon Research estimates as of close on March 19, Mar Exhibit 7: Foreign Institutional Investor (FINI) holdings FINI holding in Taiwan market (%) 01-Mar 02-Mar 03-Mar 04-Mar 05-Mar 06-Mar 07-Mar 08-Mar 09-Mar 10-Mar 11-Mar 12-Mar 13-Mar 14-Mar 15-Mar Source: CMoney, Fubon Research estimates as of close on March 19,

5 South Africa Overall, the mood within South Africa was subdued, with ongoing power shortages and the health of the consumer top-of-mind topics. The country is facing the consequences of years of underinvestment in electricity generation. Power constraints are weighing on GDP growth with blackouts an increasingly common occurrence, leaving businesses to spend a growing amount of time and money trying to navigate the situation. The state electricity company, Eskom, continues to struggle operationally. Poor execution has pushed out the timeline for commissioning new generation capacity while the management team has recently been removed pending an operational investigation. Eskom is also facing significant financial challenges, with a large funding shortfall and a credit rating that was recently downgraded to junk by S&P. Household consumption accounts for approximately 60% of South Africa s GDP and the consumer remains under pressure. The consumer credit cycle is showing signs of bottoming following a spectacular collapse in unsecured credit growth, but any recovery from here is unlikely to be V-shaped as consumer leverage remains high and job growth has ground to a halt. Lower inflation and continued real wage gains for those with jobs have provided incremental support. However, the average consumer has not benefited significantly from the lower oil price while the inflation rate of electricity remains high (Eskom is applying for a 25% tariff increase for the upcoming year). Several of the retailers noted the price sensitivity of consumers and the increasing difficulty of passing along cost pressures driven by continued currency depreciation. Performance Review and Portfolio Positioning The Driehaus Emerging Markets Small Cap Growth Fund returned 5.30% in April, compared to the MSCI Emerging Markets Small Cap Index return of 9.08% and the MSCI Emerging Markets return of 7.72%. 1 Similar to the conditions of March 2014, growth substantially underperformed value, owing to the flow-driven and rotational nature of the rally (Exhibit 8). Our largest overweight, India, continued to struggle as a result of a number of issues related to enacting policies to increase infrastructure investment. Last year we said of India, there was no alternative. Now, with the aforementioned strength of the Chinese equity market, a credible alternative has emerged to compete for EM investors capital. While we hedged India during this downturn and have cut our overweight position substantially in recent months, we still carry a meaningful overweight. India contributed to the fund s underperformance for the month. Exhibit 8: MSCI Emerging Markets Growth Index Relative to MSCI Emerging Markets Value Index Source: Bloomberg 1 Performance Disclosure The performance data shown represents past performance and does not guarantee future results. Current performance may be lower or higher than the performance data quoted. Principal value and investment returns will fluctuate so that investors shares, when redeemed, may be worth more or less than their original cost. The Fund will charge a redemption fee of 2.00% on shares held less than 60 days. Performance data represents the rate that an investor would have earned (or lost) on an investment in the Fund (assuming reinvestment of all dividends and distributions). Average annual total return reflects annualized change, while cumulative total return reflects aggregate change. Since Fund performance is subject to change after the month-end, please call (800) or visit for more current performance information. Sources: Driehaus Capital Management LLC, Factset, Reuters and MSCI Indices 5

6 Outlook Looking ahead, we start with the observation that market sentiment toward the US dollar and oil has now swung in the opposite direction from where it stood earlier this year. The correction in the US dollar index has fueled a rally in heavily shorted areas of emerging markets, such as Brazil, while exceptionally weak GDP figures in the US may lead investors to believe we won t see a rise in interest rates this year after all. All of this leaves open the possibility that the US dollar bull run may have come to an end. We find it a bit dangerous to jump to this view for two reasons. First, seasonally stronger growth in the US into the summer months, coupled with continued labor market improvements, may serve to resurrect the notion of an improving economy and a Fed rate hike in the fall. Second, the recent bout of euro appreciation into the end of April appears to have been at least partially driven by a vigorous unwind of risk parity strategies concentrated in Europe, and may be more reflective of technical factors as opposed to macroeconomic forces. Sentiment could easily swing back toward a stronger dollar and a possible rate hike. We find current low volatility levels attractive for index hedges, as well as strong dollar hedges. This is especially true when considering the possibility of a US rate hike, the ongoing potential for an accident in Greece, and the unknowns associated with the risk parity unwind. Lastly, we remain bullish on China, with the expected opening of the Shenzhen Exchange to foreign participation in the next three to six months serving as a catalyst to further gains. This exchange includes many small cap securities, which only mainland Chinese investors are currently allowed to access, and whose P/E valuations have ballooned to 49x. Moreover, the high growth, tech-heavy ChiNext Index within the Shenzhen Exchange has seen its P/E multiple soar to nearly 100x. Concurrent with the Shenzhen opening to foreigners, the small cap segment of the Hong Kong Exchange will open up to mainland Chinese investors for the first time. These H-shares possess many comparable companies to the Shenzhen Exchange, but instead of trading at P/E ratios of 100x, in many cases they trade between 10x to 20x (Exhibit 9). We see substantial potential for these shares to benefit from investors exploiting the valuation gap between exchanges, and have increased our allocation to Chinese H-share companies. Exhibit 9: Historical valuation of Shenzhen Exchange and ChiNext Index 80 (x) Shenzhen P/E 0 Jan07 Jan08 Jan09 Jan10 Jan11 Jan12 Jan13 Jan14 Jan15 ChiNext P/E 140 (x) Oct09 Oct10 Oct11 Oct12 Oct13 Oct14 Source: CEIC 6

7 So, whether you feel Confused : S Skeptical >:\ Or simply feel like being a cheerleader for the China rally *\O/* Thank you for your interest in the Driehaus Emerging Markets Small Cap Growth Fund. Until next month, Chad Cleaver Driehaus Alternative Strategies Please visit our website or click a fund below to download a monthly commentary: Driehaus Active Income Fund (LCMAX) Driehaus Select Credit Fund (DRSLX) Driehaus Event Driven Fund (DEVDX) Driehaus Emerging Markets Small Cap Growth Fund (DRESX) Chad Cleaver Lead Portfolio Manager, Driehaus Emerging Markets Small Cap Growth Strategy 7

8 DRIEHAUS EMERGING MARKETS SMALL CAP GROWTH FUND PERFORMANCE RECAP MONTH-END PERFORMANCE AS OF 4/30/15 Average Annual Total Return Fund/Index MTD YTD 1 Year 3 Year 5 Year 10 Year Since Inception 1 Driehaus Emerging Markets Small Cap Growth Fund % 9.77% 8.13% 13.36% 11.09% n/a 18.93% MSCI Emerging Markets Small Cap Index % 13.02% 10.12% 7.52% 4.23% n/a 19.90% MSCI Emerging Markets Index % 10.17% 8.17% 3.60% 3.35% n/a 14.33% CALENDAR QUARTER-END PERFORMANCE AS OF 3/31/15 Average Annual Total Return Fund/Index QTR YTD 1 Year 3 Year 5 Year 10 Year Since Inception 1 Driehaus Emerging Markets Small Cap Growth Fund % 4.24% 3.30% 11.79% 10.34% n/a 18.24% MSCI Emerging Markets Small Cap Index % 3.62% 1.37% 3.80% 2.93% n/a 18.74% MSCI Emerging Markets Index % 2.28% 0.79% 0.67% 2.08% n/a 13.66% Annual Fund Operating Expenses 5 Management Fee 1.50% Other Expenses 0.23% Total Annual Fund Operating Expenses 1.73% The performance data shown above represents past performance and does not guarantee future results. Current performance may be lower or higher than the performance data quoted. Principal value and investment returns will fluctuate so that investors shares, when redeemed, may be worth more or less than their original cost. The Fund will charge a redemption fee of 2.00% on shares held less than 60 days. Performance data represents the rate that an investor would have earned (or lost) on an investment in the Fund (assuming reinvestment of all dividends and distributions). Average annual total return reflects annualized change, while cumulative total return reflects aggregate change. Since Fund performance is subject to change after the month-end, please call (800) or visit for more current performance information. 1 Inception Date: 12/1/2008. Since Inception is calculated to include performance from the Fund s predecessor limited partnership. 2 The average annual total returns of the Driehaus Emerging Markets Small Cap Growth Fund include the performance of the Fund s predecessor limited partnership, which is calculated from December 1, 2008 before the Fund commenced operations and succeeded to the assets of its predecessor on August 22, The predecessor limited partnership was not registered under the Investment Company Act of 1940, as amended ( 1940 Act ) and thus was not subject to certain investment and operational restrictions that are imposed by the 1940 Act. If the predecessor had been registered under the 1940 Act, its performance may have been adversely affected. The Fund s predecessor performance has been restated to reflect estimated expenses of the Fund. After-tax performance returns are not included for the predecessor limited partnership. The predecessor was not a regulated investment company and therefore did not distribute current or accumulated earnings. 3 The Morgan Stanley Capital International Emerging Markets Small Cap Index (MSCI Emerging Markets Small Cap Index) is a market capitalization-weighted index designed to measure equity market performance of small cap stocks in 22 global emerging markets. 4 The Morgan Stanley Capital International Emerging Markets Index (MSCI Emerging Markets Index) is a market capitalization-weighted index designed to measure equity market performance in 25 global emerging markets. 5 Represents the Annual Fund Operating Expenses as disclosed in the current prospectus dated April 30, It is important to understand that a decline in the Fund s average net assets due to unprecedented market volatility or other factors could cause the Fund s expense ratio for the current fiscal year to be higher than the expense information presented. The Fund invests in foreign securities, including small and mid cap stocks, which may be subject to greater volatility than other investments. During certain periods, the Fund has benefited from unusually strong market conditions. At times, a significant portion of a Fund s return may be attributable to investments in initial public offerings (IPOs) or concentrations in certain strong performing sectors, such as technology. Returns from IPOs or sector concentrations may not be repeated or consistently achieved in the future. In addition, participating in IPOs and other investments during favorable market conditions may enhance the performance of a Fund with a smaller asset base, and the Fund may not experience similar performance results as its assets grow. Investments in overseas markets can pose more risks than U.S. investments, and the Fund s share prices are expected to be more volatile than that of a U.S.-only fund. In addition, the Fund s returns will fluctuate with changes in stock market conditions, currency values, interest rates, foreign government regulations, and economic and political conditions in countries in which the Fund invests. These risks are generally greater when investing in emerging markets. These and other risk considerations are discussed in the Fund s prospectus. Please consider the investment objectives, risks, fees and expenses of the Fund carefully prior to investing. The prospectus and summary prospectus contain this and other important information about the Fund. To obtain a copy of the prospectus and/or summary prospectus, please call us at (800) or visit Please read the prospectus carefully before investing. Sources: Morgan Stanley Capital International Inc., evestment Alliance, LLC, SS&C Inc. Copyright MSCI All Rights Reserved. Without prior written permission of MSCI, this information and any other MSCI intellectual property may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used to create any financial instruments or products or any indices. This information is provided on an as is basis, and the user of this information assumes the entire risk of any use made of this information. Neither MSCI, each of its affiliates nor any third party involved in or related to the computing, compiling or creating of any MSCI information (collectively, the MSCI Parties ) expressly disclaims all warranties (including, without limitation, any warranties of originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages relating to any use of this information. Driehaus Securities LLC, Distributor 8

9 Mkt. Cap Breakout DRIEHAUS EMERGING MARKETS SMALL CAP GROWTH FUND PORTFOLIO CHARACTERISTICS PORTFOLIO SNAPSHOT ex-cash AUM $638,247,105 Cash/AUM 5.03% Long Exposure $631,564,299 $599,487,666 Short Exposure ($231,730,951) ($231,730,951) Net Exposure $399,833,348 $367,756,715 Net Exposure/AUM 62.65% 57.62% Gross Exposure $863,295,250 $831,218,617 Gross Exposure/AUM 1.35x 1.30x PORTFOLIO CHARACTERISTICS Fund Benchmark Number of Holdings 146 1,786 Active Share (3-year avg.) n/a Est. 3-5 Year EPS Growth 31.2% 17.1% Weighted Avg. Market Cap ($M) $2,286 $1,256 Median Market Cap ($M) $1,604 $621 < $5 billion 91.5% 98.8% > $5 billion 8.5% 1.2% RISK & RETURN CHARACTERISTICS (Trailing 3-years) Fund vs. MSCI EM MSCI Emerging Fund vs. Small Cap Markets Annualized Return Standard Deviation Upside Capture Downside Capture Beta Alpha 7.65 n/a n/a Sharpe Ratio R-Square Tracking Error Information Ratio 0.77 n/a 0.94 n/a # Negative Monthly Returns # Positive Monthly Returns Annualized Return 14% 12% 10% 8% 6% 4% 2% MSCI EM Small Cap Driehaus Emerging Markets Small Cap Growth Fund MSCI Emerging Markets 0% 9% 12% 15% Annualized Standard Deviation FUND S EXCESS RETURNS 2 (%pts) vs. MSCI EM Small Cap Index Months with Negative Index Returns (Since Inception on 12/1/08) 8% 6% 4% 2% 0% -2% -4% Outperformed in 26 of 30 down months Jan-09 Feb-09 Jun-09 Jan-10 May-10 Nov-10 Jan-11 Feb-11 May-11 Jun-11 Aug-11 Sep-11 Nov-11 Dec-11 Mar-12 Apr-12 May-12 Jul-12 Oct-12 May-13 Jun-13 Aug-13 Nov-13 Dec-13 Jan-14 Sep-14 Oct-14 Nov-14 Dec-14 Mar-15 Source: FactSet Research Systems LLC and Driehaus Capital Management. Data calculated with monthly returns. Data as of 4/30/15. 1 Data is calculated monthly. 2 This chart depicts Driehaus Emerging Markets Small Cap Growth Fund s (DRESX) outperformance (or underperformance) versus the MSCI Emerging Markets Small Cap Index in all instances where the MSCI Emerging Markets Small Cap Index had a negative monthly return since DRESX s inception on 12/1/2008. Net of fee performance is used. MSCI Emerging Markets Small Cap Index. Data as of April 30, Performance for the Driehaus Emerging Markets Small Cap Growth Fund (DRESX) is used. The performance quoted represents past performance and does not guarantee future results. Investment return and principal value of an investment will fluctuate so that an investor s shares, when redeemed, may be worth more or less than the original cost. Current performance may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling (800) or visiting our website at Fund returns shown include the reinvestment of all dividends and capital gains. Contractual fee waivers are currently in effect. Without such fee waivers, performance numbers would be reduced. The total annual fund operating expense for DRESX is 1.85% as disclosed in the 4/30/14 prospectus. Please see notes at end of presentation for more information on indices used. A definition of key terms can be found on page 11. 9

10 COUNTRY EXPOSURES 1 Equity Weights Long Hedges 3 Short Hedges 3 Net Exposure Benchmark Weight Net Exposure Over-/Underweight SECTOR EXPOSURES 1 Equity Weights Long Hedges 3 Short Hedges 3 Net Exposure Benchmark Weight Net Exposure Over-/Underweight Argentina 0.56% % % Brazil 3.02% % -0.29% 3.41% -3.70% Cambodia 0.39% 0.00% 0.00% 0.39% 0.00% 0.39% Chile 0.00% % 1.03% -1.03% China 23.65% % 17.21% 24.65% -7.44% Czech Republic 0.00% % 0.03% -0.03% Egypt 0.00% % 0.78% -0.78% Greece 0.00% % 0.54% -0.54% Hungary 0.00% % 0.11% -0.11% India 15.12% % 8.48% 6.64% Indonesia 2.85% % 2.84% 0.01% Kazakhstan 1.36% % 0.00% 1.36% Kenya 0.71% % 0.00% 0.71% Malaysia 1.71% % 3.77% -2.06% Mexico 2.30% % 2.42% -0.13% Nigeria 0.26% % 0.00% 0.26% Pakistan 1.28% % 0.00% 1.28% Panama 0.00% % 0.08% -0.08% Peru 0.00% % 0.06% -0.06% Philippines 2.69% % 1.51% 1.18% Poland 1.56% % 1.15% 0.41% Qatar 0.00% % 0.48% -0.48% Russia 2.01% % 0.61% 1.41% Saudi Arabia 4.34% % 0.00% 4.34% South Africa 0.95% % 0.19% 6.61% -6.43% South Korea 8.92% % 17.60% -8.68% Taiwan 10.14% % 17.67% -7.53% Thailand 3.67% % 3.52% 0.15% Turkey 2.21% % 1.17% 1.43% -0.26% United Arab Emirates 0.00% % 0.81% -0.81% Vietnam 0.49% % 0.00% 0.49% Other Countries % % 0.40% 3.32% EM Index Equity Hedges % % % U.S. Index Equity Hedges % 0.00% % Other - Sector/Currency Hedges % % % Total Exposure (ex-cash) 93.93% 0.00% % 57.62% % % Consumer Discretionary 17.75% % 15.77% 1.98% Consumer Staples 7.40% % 7.52% -0.12% Energy 1.28% % 1.82% -0.54% Financials 22.52% % 20.44% 2.08% Health Care 6.60% % 6.74% -0.14% Industrials 18.18% % 15.51% 2.67% Information Technology 13.14% % 16.15% -3.01% Materials 4.84% % 11.94% -7.10% Telecom. Services 0.71% % 0.70% 0.01% Utilities 1.50% % 3.41% -1.91% Other - Market/Currency Hedges % % % Total Exposure (ex-cash) 93.93% 0.00% % 57.62% % % PORTFOLIO WEIGHTS (Net Exposure) Frontier Market: 8.45% Emerging Market: 45.45% Other Countries: 3.72% 1 Data is on a trade date basis and has not been reconciled. Exposures reflect hedged positions. 2 Other represents companies with significant emerging markets related exposures that are not domiciled within an emerging market. 3 Delta-adjusted and underlying exposures include ETFs that may be domiciled in the U.S. but provide specific sector, country or market related exposure. 10

11 TOP 5 HOLDINGS* (as of 3/31/15) Company Country Description % of Fund SKS Microfinance Limited India An India-based financing company 4.9 CT Environmental Group Ltd. Hong Kong A provider of customized wastewater treatment and industrial water supply services 2.5 Mail.ru Group Ltd. Sponsored GDR RegS Russia Operates services and online social networking sites 2.2 Iguatemi Empresa de Shopping Centers S.A Brazil Brazil-based company engaged in the real estate development sector 2.2 Zhuzhou CSR Times Electric Co., Ltd. Class H China Manufacture of train-borne electrical systems and electrical components 2.0 *Holdings subject to change. Notes The Fund invests in foreign securities, including small and mid cap stocks, which may be subject to greater volatility than other investments. During certain periods, the Fund has benefited from unusually strong market conditions. At times, a significant portion of a Fund s return may be attributable to investments in initial public offerings (IPOs) or concentrations in certain strong performing sectors, such as technology. Returns from IPOs or sector concentrations may not be repeated or consistently achieved in the future. In addition, participating in IPOs and other investments during favorable market conditions may enhance the performance of a Fund with a smaller asset base, and the Fund may not experience similar performance results as its assets grow. Investments in overseas markets can pose more risks than U.S. investments, and the Fund s share prices are expected to be more volatile than that of a U.S.-only fund. In addition, the Fund s returns will fluctuate with changes in stock market conditions, currency values, interest rates, foreign government regulations, and economic and political conditions in countries in which the Fund invests. These risks are generally greater when investing in emerging markets. These and other risk considerations are discussed in the Fund s prospectus. Please consider the investment objectives, risks, fees and expenses of the Fund carefully prior to investing. The prospectus and summary prospectus contain this and other important information about the Fund. To obtain a copy of the prospectus and/or summary prospectus, please call us at (800) or visit Please read the prospectus carefully before investing. TERMS: Beta is a measure of a portfolio s volatility. A beta of 1.00 implies perfect historical correlation of movement with the market. A higher beta manager will rise and fall more rapidly than the market, whereas a lower beta manager will rise and fall slower. Alpha is the measure of performance on a risk-adjusted basis. Alpha takes the volatility (price risk) of a mutual fund and compares its risk-adjusted performance to a benchmark index. Standard deviation is a measure of the average deviations of a return series from its mean; often used as a measure of portfolio volatility. A large standard deviation implies that there have been large swings or volatility in the manager s return series. Sharpe ratio is calculated by finding the portfolio s excess return and then dividing by the portfolio s standard deviation. Downside/Upside capture is a measure of performance in up markets (upside) and down markets (downside) relative to the Index. Active share represents the share of portfolio holdings that differ from the benchmark index holdings. Average drawdown is the arithmetic average of declines in value during a given period of time. Downside risk is a measure of the average deviations of a negative return series. A large downside risk implies that there have been large swings or volatility in the manager s return series. Tracking error measures of the amount of active risk that is being taken by a manager. Tracking error accounts for the deviation away from the benchmark and does not indicate in which direction it occurred, either positive or negative. Information ratio is a measure of the value added per unit of active risk by a manager over the index. A positive ratio indicates efficient use of risk by the manager. R-Squared is a statistical measure that represents the percentage of a fund s movements that can be explained by movements in a benchmark index. At-the-money is a term used to describe a situation where an option s strike price is identical to the price of the underlying security. Out-of-the-money is a term used to describe an option that has no intrinsic value, such as when a call option has a strike price that is higher than the market price of the underlying asset, or a put option with a strike price that is lower than the market price of the underlying asset. Moneyness is a description of a derivative relating its strike price to the price of its underlying asset. It describes the intrinsic value of an option in its current state. 11