If
the shares are not redeemed:
|
Share
Class
|
1
year
|
3
years
|
5
years
|
10
years
|
A
|
$696
|
$1,004
|
$1,333
|
$2,263
|
C
|
$221
|
$
682
|
$1,169
|
$2,513
|
I
|
$125
|
$
390
|
$
676
|
$1,489
|
Portfolio Turnover:
The fund pays transaction costs, such as commissions, when it buys and sells securities (or “turns over” its portfolio). A higher portfolio turnover rate may indicate higher
transaction costs and may result in higher taxes when fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the Example, affect the fund’s performance.
During the most recent fiscal year, the portfolio
turnover rate for the fund was 49% of the average value of its portfolio.
Principal Investment Strategies:
The fund’s sub-adviser, Lombardia Capital Partners, LLC (the “sub-adviser”), invests, under normal circumstances, at least 80% of the fund’s net assets (plus the
amount of borrowings, if any, for investment purposes) in equity securities of small companies. The fund generally considers small companies to be companies with capitalizations that, at the time of purchase, are within the range of companies
included in the Russell 2000
®
Value Index
1
. As of December 31, 2013, the market capitalization range of the Russell 2000
®
Value Index was between $37 million and $4.6 billion.
Although the portfolio management team primarily
focuses on buying companies trading below their historic price to earnings ratio, stocks are also evaluated for anticipated fundamental catalysts that may narrow the discount between the current and historic price to earnings ratio. Additionally,
the strategy also incorporates a preference towards higher quality companies, which are generally companies with strong balance sheets, free cash flow generation, liquidity, high interest coverage, and below average levels of debt.
From time to time, the fund may invest in
exchange-traded funds (“ETFs”) in order to manage market liquidity and timing issues.
Under adverse or unstable market, economic or
political conditions, the fund may take temporary defensive positions in cash and short-term debt securities without limit. During periods of defensive investing, it will be more difficult for the fund to achieve its objective.
1
Russell Investment Group is the source and owner of the trademarks, service marks and copyrights related to the Russell indexes.
Russell
®
is a trademark of Russell Investment Group.
Principal Risks:
Risk is inherent in all investing. Many factors affect the fund's performance. There is no assurance the fund will meet its investment objective. The value of your investment in the fund, as
well as the amount of return you receive on your investment, may fluctuate significantly. You may lose part or all of your investment in the fund or your investment may not perform as well as other similar investments. The following is a summary
description of principal risks (in alphabetical order) of investing in the fund.
You may lose money if you invest in this fund.
•
|
Cash Management and Defensive
Investing –
The value of investments held by the fund for cash management or defensive investing purposes can fluctuate. Like other fixed income securities, cash and cash equivalent
securities are subject to risk, including market, interest rate and credit risk. If the fund holds cash uninvested, the fund will be subject to the credit risk of the depository institution holding the cash, it will not earn income on the cash and
the fund’s yield will go down. To the extent that the fund’s assets are used for cash management or defensive investing purposes, it may not achieve its objective.
|
•
|
Equity Securities –
Equity securities represent an ownership interest in an issuer, rank junior in a company’s capital structure and consequently may entail greater risk of loss than debt securities.
Equity securities include common and preferred stocks. Stock markets are volatile. The price of equity securities fluctuates based on changes in a company’s financial condition and overall market and economic conditions. If the market prices
of the equity securities owned by the fund fall, the value of your investment in the fund will decline.
|
•
|
Exchange Traded Funds –
Equity-based ETFs are subject to risks similar to those of stocks; fixed income-based ETFs are subject to risks similar to those of fixed-income securities. ETF shares may trade at a premium
or discount to net asset value. ETFs are subject to secondary market trading risks. In addition, a fund will bear a pro rata portion of the operating expenses of an ETF in which it invests.
|
•
|
Expenses –
Your actual costs of investing in the fund may be higher than the expenses shown in this prospectus for a variety of reasons. For example, expense ratios may be higher than those shown if
overall net assets decrease. Net assets are more likely to decrease and fund expense ratios are more likely to increase when markets are volatile.
|