Mutual Fund Summary Prospectus (497k)
28 Febrero 2013 - 11:55AM
Edgar (US Regulatory)
Summary Prospectus
February 28, 2013
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Emerging Markets Portfolio
Advisor Class
HLEMX
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Before you invest, you may want to review the Funds prospectus, which contains more information about the Fund and its risks. You can find the Funds prospectus and other information about
the Fund online at
www.hardingloevnerfunds.com/literature-forms-for-investing.html
. You can also get this information
at no cost by calling (877) 435-8105 or by sending an e-mail request to hardingloevnerfunds@ntrs.com. If you purchase shares of the Fund through a financial intermediary, the prospectus and other information will also be available from your
financial intermediary. The current prospectus and statement of additional information, dated February 28, 2013, are incorporated into this summary prospectus and may be obtained, free of charge, at the website, phone number or e-mail address noted
above.
Investment Objective
The Emerging Markets Portfolio (the Portfolio) seeks long-term capital appreciation through investments in equity securities of companies based in emerging markets.
Portfolio Fees and Expenses
This table describes the fees and expenses that you may pay if you buy and hold shares of the Advisor Class of the Portfolio. There is no sales charge imposed on purchases of shares.
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Shareholder Fees
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(fees paid directly from your investment)
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Redemption Fee (as a percentage of amount redeemed within 90 days or less from the date of purchase)
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2.00%
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Annual Portfolio Operating Expenses
1
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(expenses that you pay each year as a percentage of the
value of your investment)
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Management Fees
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1.14%
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Distribution (12b-1) Fees
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None
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Other Expenses
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0.33%
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Total Annual Portfolio Operating Expenses
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1.47%
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Fee Waiver and/or Expense Reimbursement
2
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None
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Total Annual Portfolio Operating Expenses After Fee Waiver and/or Expense Reimbursement
2
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1.47%
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1
Expense information in this table has been restated to reflect current fees. Therefore, the expenses in this table will not correlate to the expenses shown in the Financial
Highlights of the Portfolio.
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2
Harding
Loevner LP has contractually agreed to waive a portion of its management fee and/or reimburse the Portfolio for its other operating expenses to the extent Total Annual Portfolio Operating Expenses, as a percentage of average daily net assets, exceed
1.75
% through February 28, 2014.
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Example
:
This example is intended to help you compare the cost of investing in the Advisor Class of the Portfolio with the
cost of investing in other mutual funds. The example assumes that you invest $10,000 in the Advisor Class of 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 Advisor Classs operating expenses remain the same, except that the example assumes the fee waiver and expense reimbursement agreement pertains only through February 28, 2014. Although your
actual costs may be higher or lower, based on these assumptions your costs would be:
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1 Year
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3 Years
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5 Years
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10 Years
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$150
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$465
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$803
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$1,757
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Portfolio Turnover
The Portfolio 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 Portfolio shares are held in a taxable account. These costs, which are not reflected in annual portfolio operating expenses or in the Example, affect the Portfolios performance. During the most recent
fiscal year, the Portfolios portfolio turnover rate was
36
% of the average value of its portfolio.
Principal Investment Strategies
The Portfolio invests primarily in companies that are based in emerging and frontier markets. It may also invest in short-term or other debt securities. Emerging and frontier markets offer investment
opportunities that arise from long-term trends in demographics, deregulation, offshore outsourcing and improving corporate governance in developing countries. Harding Loevner LP (Harding Loevner), the Portfolios investment adviser,
undertakes fundamental research in an effort to identify companies that are well managed, financially sound, fast growing and strongly competitive, and whose shares are under-priced relative to their intrinsic value. To reduce its volatility, the
Portfolio is diversified across dimensions of geography, industry and currency. The Portfolio normally holds 50-80 investments across at least 15 countries. Emerging and frontier markets include countries that have an emerging stock market as
defined by Morgan Stanley Capital International, countries or markets with low- to middle-income economies as classified by the World Bank, and other countries or markets with similar characteristics. Emerging and frontier markets tend to have
relatively low gross national product per capita compared to the worlds major economies and may have the potential for rapid economic growth.
Factors bearing on whether a company is considered to be based in an emerging or frontier market may include: (1) it is legally domiciled in an emerging or frontier market; (2) it
conducts at least 50% of its business, as measured by the location of its sales, earnings, assets, or production, in an emerging or frontier market; or (3) it has the principal exchange listing for its securities in an emerging or frontier
market.
The Portfolio will invest broadly in equity and debt securities of companies domiciled in one of at least 15 countries with emerging
or frontier markets, generally considered to include all countries except Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Greece, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal,
Singapore, Spain, Sweden, Switzerland, the United Kingdom and the United States. At least 65% of the Portfolios total assets will
Emerging Markets Portfolio
Advisor Class
HLEMX
be denominated in at least three currencies other than the U.S. Dollar. For purposes of compliance with this restriction, American Depositary Receipts, Global Depositary Receipts and European
Depositary Receipts (collectively, Depositary Receipts) will be considered to be denominated in the currency of the country where the securities underlying the Depositary Receipts are traded.
The Portfolio invests at least 65% of its total assets in common stocks, preferred stocks, rights and warrants issued by companies that are based in
emerging or frontier markets, securities convertible into such securities (including Depositary Receipts), and investment companies that invest in the types of securities in which the Portfolio would normally invest. The Portfolio also may invest in
securities of U.S. companies that derive, or are expected to derive, a significant portion of their revenues from their foreign operations, although under normal circumstances, not more than 15% of the Portfolios total assets will be invested
in securities of U.S. companies. The Portfolio also may invest up to 35% of its total assets in debt securities of domestic and foreign issuers, including such instruments as corporate bonds, debentures, notes, commercial paper, short-term notes,
medium-term notes and variable rate notes.
The Portfolio invests at least 80% of its net assets (plus any borrowings for investment purposes)
in emerging and frontier markets securities. This strategy is not fundamental, but should the Portfolio decide to change this strategy, it will provide shareholders with at least 60 days prior written notice.
The Portfolio also may invest in derivatives, including forward foreign currency exchange contracts and equity derivative securities such as participation
notes; options on common stocks; and options, futures and options on futures on foreign common stock indices. Because some emerging market countries do not permit foreigners to participate directly in their securities markets or otherwise present
difficulties for efficient foreign investment, the Portfolio may use equity derivative securities, and, in particular, participation notes, to gain exposure to those countries.
Principal Risks
The Portfolio is subject to numerous risks, any of which could cause an
investor to lose money. The principal risks of the Portfolio are as follows:
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Market Risk
: Investments in the Portfolio may lose value due to a general downturn in stock markets.
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Currency Risk
: Foreign currencies may experience steady or sudden devaluation relative to the U.S. dollar, adversely affecting the
value of the Portfolios investments. Because the Portfolios net asset value is determined on the basis of U.S. dollars, if the local currency of a foreign market depreciates against the U.S. dollar, you may lose money even if the foreign
market prices of the Portfolios holdings rise.
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Foreign Investment Risk
: Securities issued by foreign entities involve risks not associated with U.S. investments. These risks
include additional taxation, political, economic, social or diplomatic instability, and the above-mentioned possibility of changes in foreign currency exchange rates. There may also be less publicly-available information about a foreign issuer.
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Emerging and Frontier Market Risk
: Emerging and frontier market securities involve unique risks, such as exposure to economies less
diverse and mature than that of the U.S. or more established foreign markets. Economic or political instability may cause larger price changes in emerging or frontier market securities than in securities of issuers based in more developed foreign
countries.
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Debt Securities Risk
: Debt securities may lose value due to unfavorable fluctuations in the level of interest rates or due to a
decline in the creditworthiness of the issuer. As interest rates rise, the value of debt securities declines. This risk is generally greater for debt securities with longer maturities than for debt securities with shorter maturities.
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Participation Notes Risk
: Participation notes are designed to replicate the return of a particular underlying equity or debt
security, currency or market. Participation notes involve the same risks associated with a direct investment in the underlying security, currency, or market. In addition, participation notes involve counterparty risk, because the Portfolio has no
rights against the issuer(s) of the underlying security(ies) and must rely on the creditworthiness of the issuer of the participation note.
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Portfolio Performance
The bar chart below shows how the Portfolios investment results
have varied from year to year. The table that follows shows how the Advisor Class average annual total returns compare with a broad measure of market performance. Together these provide an indication of the risks of investing in the Portfolio. How
the Advisor Class of the Portfolio has performed in the past (before and after taxes) is not necessarily an indication of how it will perform in the future.
Updated Portfolio performance information is available at
www.hardingloevnerfunds.com
or by calling (877) 435-8105.
The best calendar quarter return during the period shown above was
32.85
% in the
2nd
quarter of
2009; the worst was
-27.99
% in the
4th
quarter of
2008.
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Summary Prospectus
February 28, 2013
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Average Annual Total Returns
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(for the periods ended December 31, 2012)
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1-Year
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5-Year
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10-Year
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Emerging Markets Portfolio - Advisor Class
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Return Before Taxes
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22.73%
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-0.93%
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16.65%
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Return After Taxes on
Distributions
1
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21.49%
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-1.21%
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16.40%
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Return After Taxes on Distributions and Sale of Portfolio Shares
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16.43%
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-0.77%
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15.24%
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MSCI Emerging Markets (net) Index (reflects no deduction for fees, expenses, or taxes)
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18.23%
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-0.92%
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16.51%
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1
After-tax
returns in the table above are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. In some cases, the return after taxes may exceed the return before taxes due
to an assumed tax benefit from any losses on a sale of Portfolio shares at the end of the measurement period. Actual after-tax returns depend on an investors tax situation and may differ from those shown, and after-tax returns shown are not
relevant to investors who hold their Portfolio shares through tax-deferred arrangements, such as 401(k) plans or Individual Retirement Accounts.
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Management
Investment Adviser
Harding Loevner serves as investment adviser to the Portfolio.
Portfolio Managers
G.
Rusty Johnson, Craig Shaw and Richard Schmidt serve as the portfolio managers of the Emerging Markets Portfolio. Mr. Johnson has held his position since the Portfolios inception in November 1998, Mr. Shaw has held
his position since December 2006 and Mr. Schmidt has held his position since December 2011. Messrs. Johnson and Shaw are the lead portfolio managers.
Purchase and Sale of Portfolio Shares
The minimum initial investment in the Portfolio is
$5,000. Additional purchases may be for any amount. You may purchase or redeem (sell) shares of the Portfolio on any business day through certain authorized brokers and other financial intermediaries or directly from the Portfolio by mail, telephone
or wire.
Tax Considerations
The Portfolios distributions are generally taxable to you as ordinary income, capital gains, or a combination of the two, unless you are investing
through a tax-deferred arrangement, such as a 401(k) plan or an individual retirement account.
Payments to Brokers-Dealers and Other
Financial Intermediaries
If you purchase Portfolio shares through a broker-dealer or other financial intermediary (such as a bank), the
Portfolio and its related companies may pay the intermediary for the sale of Portfolio shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your salesperson to
recommend the Portfolio over another investment. Ask your salesperson or visit your financial intermediarys website for more information.
3
Harding, Loevner Funds, Inc.
c/o Northern Trust
Attn: Funds Center C5S
801 South Canal Street
Chicago, IL 60607
www.HardingLoevnerFunds.com
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