UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number: 811-02383

AB BOND FUND, INC.

(Exact name of registrant as specified in charter)

1345 Avenue of the Americas, New York, New York 10105

(Address of principal executive offices) (Zip code)

Joseph J. Mantineo

AllianceBernstein L.P.

1345 Avenue of the Americas

New York, New York 10105

(Name and address of agent for service)

Registrant’s telephone number, including area code: (800) 221-5672

Date of fiscal year end: October 31, 2015

Date of reporting period: October 31, 2015

ITEM 1. REPORTS TO STOCKHOLDERS.

OCT    ^10.31.15

ANNUAL REPORT

AB ALL MARKET REAL RETURN PORTFOLIO

Investment Products Offered

• Are Not FDIC Insured

• May Lose Value

• Are Not Bank Guaranteed

Investors should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.abglobal.com or contact your AB representative. Please read the prospectus and/or summary prospectus carefully before investing.

This shareholder report must be preceded or accompanied by the Fund’s prospectus for individuals who are not current shareholders of the Fund.

You may obtain a description of the Fund’s proxy voting policies and procedures, and information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30, without charge. Simply visit AB’s website at www.abglobal.com, or go to the Securities and Exchange Commission’s (the “Commission”) website at www.sec.gov, or call AB at (800) 227-4618.

The Fund files its complete schedule of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q are available on the Commission’s website at www.sec.gov. The Fund’s Forms N-Q may also be reviewed and copied at the Commission’s Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330. AB publishes full portfolio holdings for the Fund monthly at www.abglobal.com.

AllianceBernstein Investments, Inc. (ABI) is the distributor of the AB family of mutual funds. ABI is a member of FINRA and is an affiliate of AllianceBernstein L.P., the Adviser of the funds.

The [A/B] logo is a registered service mark of AllianceBernstein and AllianceBernstein^® is a registered service mark used by permission of the owner, AllianceBernstein L.P.

December 17, 2015

Annual Report

This report provides management’s discussion of fund performance for AB All Market Real Return Portfolio (the “Fund”) for the annual reporting period ended October 31, 2015. Prior to December 15, 2014, the Fund was named AllianceBernstein Real Asset Strategy and from December 16, 2014 until January 20, 2015 was named AllianceBernstein All Market Real Return Portfolio.

Investment Objective and Policies

The Fund’s investment objective is to maximize real return. Real return is the rate of return after adjusting for inflation. The Fund pursues an aggressive investment strategy involving a variety of asset classes. The Fund invests primarily in instruments that AllianceBernstein L.P. (the “Adviser”) expects to outperform broad equity indices during periods of rising inflation. Under normal circumstances, the Fund expects to invest its assets principally in the following instruments that, in the judgment of the Adviser, are affected directly or indirectly by the level and change in rate of inflation: inflation-indexed fixed-income securities, such as Treasury inflation-protected securities (“TIPS”) and similar bonds issued by governments outside of the United States, commodities, equity securities, such as commodity-related stocks, real estate securities, utility securities, infrastructure-related securities, securities and derivatives linked to the price of other assets (such as commodities, stock indices and real estate) and currencies. The Fund expects its investments in fixed-income securities to have a broad range of maturities and quality levels.

The Fund will seek inflation protection from investments around the globe, both in developed and emerging market countries. In selecting securities for purchase and sale, the Adviser will utilize its qualitative and quantitative resources to determine overall inflation sensitivity, asset allocation, and security selection. The Adviser assesses the securities’ risks and inflation sensitivity as well as the securities’ impact on the overall risks and inflation sensitivity of the Fund. When its analysis indicates that changes are necessary, the Adviser intends to implement them through a combination of changes to underlying positions and the use of inflation swaps and other types of derivatives, such as interest rate swaps.

The Fund anticipates that its investments, other than its investments in inflation-indexed securities, will focus roughly equally on commodity-related equity securities, commodities and commodity derivatives, and real estate equity securities to provide a balance between expected return and inflation protection. Its commodities investments will include significant exposure to energy commodities, but will also include agricultural products, and industrial and precious metals, such as gold. The Fund’s investments in real estate equity securities will include Real Estate Investment Trusts (“REITs”), other real estate-related securities, and infrastructure-related securities.

The Fund will invest in both US and non-US dollar-denominated equity or fixed-income securities. The Fund may invest in currencies for hedging or for investment purposes, both in the spot

AB ALL MARKET REAL RETURN PORTFOLIO  • 1

market and through long or short positions in currency-related derivatives. The Fund does not ordinarily expect to hedge its foreign currency exposure because it will be balanced by investments in US dollar-denominated securities, although it may hedge the exposure under certain circumstances. The Fund may invest significantly to the extent permitted by applicable law in derivatives, such as options, futures, forwards, swaps or structured notes. The Fund intends to use leverage for investment purposes through the use of cash made available by derivatives transactions to make other investments in accordance with its investment policies. In determining when and to what extent to employ leverage or enter into derivatives transactions, the Adviser will consider factors such as the relative risks and returns expected of potential investments and the cost of such transactions. The Adviser will consider the impact of derivatives in making its assessments of the Fund’s risks. The resulting exposures to markets, sectors, issuers or specific securities will be continuously monitored by the Adviser.

The Fund may seek to gain exposure to physical commodities traded in the commodities markets through investments in a variety of derivative instruments, including investments in commodity index-linked notes. The Adviser expects that the Fund will seek to gain exposure to commodities and commodity-related instruments and derivatives primarily through investments in AllianceBernstein Cayman Inflation Strategy, Ltd., a wholly-owned subsidiary of the Fund organized under the laws of the Cayman Islands (the “Subsidiary”). The Subsidiary is advised by the

Adviser and has the same investment objective and substantially similar investment policies and restrictions as the Fund except that the Subsidiary, unlike the Fund, may invest, without limitation, in commodities and commodity-related instruments. The Fund will be subject to the risks associated with the commodities, derivatives and other instruments in which the Subsidiary invests, to the extent of its investment in the Subsidiary. The Fund limits its investment in the Subsidiary to no more than 25% of its net assets. Investment in the Subsidiary is expected to provide the Fund with commodity exposure within the limitations of federal tax requirements that apply to the Fund.

The Fund is “non-diversified”, which means that it may concentrate its assets in a smaller number of issuers than a diversified fund.

Investment Results

The table on page 7 shows the Fund’s performance compared to its primary benchmark, the Morgan Stanley Capital International All Country (“MSCI AC”) World Commodity Producers Index (net) and the All Market Real Return Portfolio Benchmark, composed of equal weightings of the MSCI AC World Commodity Producers Index, the Financial Times Stock Exchange European Public Real Estate Association/National Association of Real Estate Investment Trusts (“FTSE EPRA/NAREIT”) Global Index and the Dow Jones-UBS Commodity Index, for the six- and 12-month periods ended October 31, 2015.

All share classes of the Fund outperformed the primary benchmark

2 •  AB ALL MARKET REAL RETURN PORTFOLIO

during both periods, yet underperformed the All Market Real Return Portfolio Benchmark, before sales charges. For the six-month period, strategic allocations to commodity futures, real estate stocks and consumer price index (“CPI”) swaps added to relative performance. An allocation to crude oil futures detracted from performance, but to a smaller extent. For the 12-month period, strategic allocations to real estate stocks and CPI swaps contributed; strategic allocation to commodity futures detracted from performance, but to a smaller degree. During both periods, long-dated WTI crude futures, security selection and asset class allocation to real estate stocks detracted from performance. Asset allocation, security selection in commodity stocks, commodity futures alpha strategy and currency positioning added to performance.

The Fund utilized derivatives for hedging and investment purposes, including Treasury futures, total return swaps and written options, which detracted from returns during both periods in absolute terms; currency forwards and inflation swaps detracted during the six-month period and added during the 12-month period; interest rate swaps added during the six-month period and detracted during the 12-month period; and purchased options added during both periods.

Market Review and Investment Strategy

The 12-month period ended October 31, 2015 was one of the most volatile periods for global financial markets since 2011. Risk aversion spiked during the third quarter of 2015 as a surprise

devaluation of the Chinese yuan and potential spillover of weakness in China and emerging markets, along with the imminent US Federal Reserve (the “Fed”) rate hikes, created an environment of very high uncertainty.

Given that the epicenter of the volatility was the weakness from China and emerging markets, commodity-related investments were the hardest hit, as these events arose in the backdrop of oversupplied markets and tepid demand, thus creating the perfect storm for these markets. Also, more broadly, inflation expectations and all inflation-sensitive assets fell during the period on commodity weakness, fears of slowing global growth and the perception of a Fed hike in this context as being a policy error. Specifically, commodities most leveraged to China demand, such as base metals and bulks (iron ore, coal), performed worst.

The Fund has retained exposure to long-horizon inflation expectations and long-dated crude futures (2017, 2018 and 2019 WTI futures) which the All Market Real Return Portfolio Team (the “Team”) believes should benefit most from signs of reflation. The Fund also retains the underweight to North American REITs, although the Team has reduced the size of the underweight as the threat to the multiple from rising rates is a lot more benign now than was expected at the beginning of 2015. Finally, the Fund has reduced the size of the overweight to the US dollar given the renormalization of the negative correlations between the US dollar and commodities, and also given the strong run up in the US dollar in anticipation of a Fed rate hike.

AB ALL MARKET REAL RETURN PORTFOLIO  • 3

DISCLOSURES AND RISKS

Benchmark Disclosure

The MSCI AC World Commodity Producers Index (net), the FTSE^® EPRA/NAREIT Global Index and the Dow Jones-UBS Commodity Index are unmanaged and do not reflect fees and expenses associated with the active management of a mutual fund portfolio. The All Market Real Return Portfolio Benchmark is an equally-weighted blend of the MSCI AC World Commodity Producers Index, the FTSE EPRA/NAREIT Global Index and the Dow Jones-UBS Commodity Index. The MSCI AC World Commodity Producers Index is a free float-adjusted, market capitalization index designed to track the performance of global listed commodity producers, including emerging markets. Net returns include the reinvestment of dividends after deduction of non-US withholding tax. The FTSE EPRA/NAREIT Global Index (market-value-weighted index based upon the last closing price of the month) represents the performance of tax-qualified REITs listed on the NYSE, AMEX and the NASDAQ. The Dow Jones-UBS Commodity Index measures price movements of the commodities included in the appropriate sub index. It does not account for effects of rolling futures contracts or costs associated with holding the physical commodity. Commodities sectors include: energy, grains, industrial metals, petroleum, precious metals and softs. MSCI makes no express or implied warranties or representations, and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indices, any securities or financial products. This report is not approved, reviewed or produced by MSCI. An investor cannot invest directly in an index, and its results are not indicative of the performance for any specific investment, including the Fund.

A Word About Risk

Market Risk: The value of the Fund’s assets will fluctuate as the stock, commodity and bond markets fluctuate. The value of the Fund’s investments may decline, sometimes rapidly and unpredictably, simply because of economic changes or other events that affect large portions of the market.

Credit Risk: An issuer or guarantor of a fixed-income security, or the counterparty to a derivatives or other contract, may be unable or unwilling to make timely payments of interest or principal, or to otherwise honor its obligations. The issuer or guarantor may default, causing a loss of the full principal amount of a security. The degree of risk for a particular security may be reflected in its credit rating. There is the possibility that the credit rating of a fixed-income security may be downgraded after purchase, which may adversely affect the value of the security. Investments in fixed-income securities with lower ratings tend to have a higher probability that an issuer will default or fail to meet its payment obligations.

Interest Rate Risk: Changes in interest rates will affect the value of investments in fixed-income securities. When interest rates rise, the value of investments in fixed-income securities tends to fall and this decrease in value may not be offset by higher income from new investments. Interest rate risk is generally greater for fixed-income securities with longer maturities or durations.

Commodity Risk: Investing in commodities and commodity-linked derivative instruments, either directly or through the Subsidiary, may subject the Fund to greater volatility than investments in traditional securities. The value of commodity-linked derivative instruments may be affected by changes in overall market movements, commodity index volatility, changes in interest rates, or factors affecting a particular industry or commodity, such as drought, floods, weather, livestock disease, embargoes, tariffs and international economic, political and regulatory developments.

Derivatives Risk: Derivatives may be illiquid, difficult to price, and leveraged so that small changes may produce disproportionate losses for the Fund, and may be subject to counterparty risk to a greater degree than more traditional investments.

(Disclosures, Risks and Note about Historical Performance continued on next page)

4 •  AB ALL MARKET REAL RETURN PORTFOLIO

Disclosures and Risks

DISCLOSURES AND RISKS

(continued from previous page)

Leverage Risk: To the extent the Fund uses leveraging techniques, its net asset value (“NAV”) may be more volatile because leverage tends to exaggerate the effect of changes in interest rates and any increase or decrease in the value of the Fund’s investments.

Liquidity Risk: Liquidity risk occurs when certain investments become difficult to purchase or sell. Difficulty in selling less liquid securities may result in sales at disadvantageous prices affecting the value of your investment in the Fund. Causes of liquidity risk may include low trading volumes and large positions. Foreign fixed-income securities may have more liquidity risk because secondary trading markets for these securities may be smaller and less well-developed and the securities may trade less frequently. Liquidity risk may be higher in a rising interest rate environment, when the value and liquidity of fixed-income securities generally go down.

Foreign (Non-US) Risk: Investments in securities of non-US issuers may involve more risk than those of US issuers. These securities may fluctuate more widely in price and may be less liquid due to adverse market, economic, political, regulatory or other factors.

Currency Risk: Fluctuations in currency exchange rates may negatively affect the value of the Fund’s investments or reduce its returns.

Subsidiary Risk: By investing in the Subsidiary, the Fund is indirectly exposed to the risks associated with the Subsidiary’s investments. The derivatives and other investments held by the Subsidiary are generally similar to those that are permitted to be held by the Fund and are subject to the same risks that apply to similar investments if held directly by the Fund. The Subsidiary is not registered under the Investment Company Act of 1940, as amended (the “1940 Act”), and, unless otherwise noted in this Prospectus, is not subject to all of the investor protections of the 1940 Act. However, the Fund wholly owns and controls the Subsidiary, and the Fund and the Subsidiary are managed by the Adviser, making it unlikely the Subsidiary will take actions contrary to the interests of the Fund or its shareholders.

Real Estate Risk: The Fund’s investments in real estate securities have many of the same risks as direct ownership of real estate, including the risk that the value of real estate could decline due to a variety of factors that affect the real estate market generally. Investments in REITs may have additional risks. REITs are dependent on the capability of their managers, may have limited diversification, and could be significantly affected by changes in taxes.

Diversification Risk: The Fund may have more risk because it is “non-diversified”, meaning that it can invest more of its assets in a smaller number of issuers and that adverse changes in the value of one security could have a more significant effect on the Fund’s NAV.

Management Risk: The Fund is subject to management risk because it is an actively-managed investment fund. The Adviser will apply its investment techniques and risk analyses in making investment decisions, but there is no guarantee that its techniques will produce the intended results.

These risks are fully discussed in the Fund’s prospectus. As with all investments, you may lose money by investing in the Fund.

An Important Note About Historical Performance

The investment return and principal value of an investment in the Fund will fluctuate, so that shares, when redeemed, may be worth more or less than their original cost. Performance shown on the following pages represents past performance and does not guarantee future results. Current performance may be

(Disclosures, Risks and Note about Historical Performance continued on next page)

AB ALL MARKET REAL RETURN PORTFOLIO  • 5

Disclosures and Risks

DISCLOSURES AND RISKS

(continued from previous page)

lower or higher than the performance information shown. You may obtain performance information current to the most recent month-end by visiting www.abglobal.com.

Investors should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.abglobal.com. For Class 1 shares, Click on “Private Clients”, then “Investments”, then “Stocks” or “Bonds”, then “Prospectuses, SAIs, and Shareholder Reports”. Please read the prospectus and/or summary prospectus carefully before investing.

All fees and expenses related to the operation of the Fund have been deducted. NAV returns do not reflect sales charges; if sales charges were reflected, the Fund’s quoted performance would be lower. SEC returns reflect the applicable sales charges for each share class: a 4.25% maximum front-end sales charge for Class A shares; a 1% 1-year contingent deferred sales charge for Class C shares. Returns for the different share classes will vary due to different expenses associated with each class. Performance assumes reinvestment of distributions and does not account for taxes.

6 •  AB ALL MARKET REAL RETURN PORTFOLIO

Disclosures and Risks

HISTORICAL PERFORMANCE

THE FUND VS. ITS BENCHMARK PERIODS ENDED OCTOBER 31, 2015 (unaudited)	NAV Returns
	6 Months		12 Months
AB All Market Real Return Portfolio
Class 1*		-15.01%		-21.12%
Class 2*		-14.82%		-20.85%
Class A		-15.05%		-21.16%
Class C		-15.38%		-21.75%
Advisor Class†		-14.96%		-20.95%
Class R†		-15.17%		-21.37%
Class K†		-15.05%		-21.19%
Class I†		-14.92%		-20.97%
Class Z†		-14.90%		-20.94%
Primary Benchmark: MSCI AC World Commodity Producers Index (net)		-20.79%		-25.10%
All Market Real Return Portfolio Benchmark		-13.31%		-16.95%
*    Class 1 shares are only available to Bernstein Global Wealth Management private client accounts. Class 2 shares are only available to the Adviser’s institutional clients or through other limited arrangements. †      Please note that these share classes are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Fund.

See Disclosures, Risks and Note about Historical Performance on pages 4-6.

(Historical Performance continued on next page)

AB ALL MARKET REAL RETURN PORTFOLIO  • 7

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

GROWTH OF A $10,000 INVESTMENT IN THE FUND

3/8/10* TO 10/31/15 (unaudited)

This chart illustrates the total value of an assumed $10,000 investment in AB All Market Real Return Portfolio Class A shares (from 3/8/10* to 10/31/15) as compared to the performance of its benchmark. The chart reflects the deduction of the maximum 4.25% sales charge from the initial $10,000 investment in the Fund and assumes the reinvestment of dividends and capital gains distributions.

* Inception date: 3/8/2010.

See Disclosures, Risks and Note about Historical Performance on pages 4-6.

(Historical Performance continued on next page)

8 •  AB ALL MARKET REAL RETURN PORTFOLIO

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

AVERAGE ANNUAL RETURNS AS OF OCTOBER 31, 2015 (unaudited)
	NAV Returns			SEC Returns (reflects applicable sales charges)
Class 1 Shares*
1 Year		-21.12	%		-21.12	%
5 Years		-4.43	%		-4.43	%
Since Inception†		-1.91	%		-1.91	%
Class 2 Shares*
1 Year		-20.85	%		-20.85	%
5 Years		-4.19	%		-4.19	%
Since Inception†		-1.66	%		-1.66	%
Class A Shares
1 Year		-21.16	%		-24.53	%
5 Years		-4.49	%		-5.31	%
Since Inception†		-1.96	%		-2.70	%
Class C Shares
1 Year		-21.75	%		-22.52	%
5 Years		-5.16	%		-5.16	%
Since Inception†		-2.67	%		-2.67	%
Advisor Class Shares‡
1 Year		-20.95	%		-20.95	%
5 Years		-4.21	%		-4.21	%
Since Inception†		-1.69	%		-1.69	%
Class R Shares‡
1 Year		-21.37	%		-21.37	%
5 Years		-4.70	%		-4.70	%
Since Inception†		-2.18	%		-2.18	%
Class K Shares‡
1 Year		-21.19	%		-21.19	%
5 Years		-4.45	%		-4.45	%
Since Inception†		-1.93	%		-1.93	%
Class I Shares‡
1 Year		-20.97	%		-20.97	%
5 Years		-4.21	%		-4.21	%
Since Inception†		-1.67	%		-1.67	%
Class Z Shares‡
1 Year		-20.94	%		-20.94	%
Since Inception†		-12.48	%		-12.48	%

See Disclosures, Risks and Note about Historical Performance on pages 4-6.

(Historical Performance and footnotes continued on next page)

AB ALL MARKET REAL RETURN PORTFOLIO  • 9

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

The Fund’s prospectus fee table shows the Fund’s total annual operating expense ratios as 1.14%, 0.89%, 1.30%, 2.02%, 1.02%, 1.55%, 1.24%, 0.91% and 0.88% for Class 1, Class 2, Class A, Class C, Advisor Class, Class R, Class K, Class I and Class Z shares, respectively, gross of any fee waivers or expense reimbursements. Contractual fee waivers and/or expense reimbursements limit the Fund’s annual operating expense ratios (exclusive of interest expense) to 1.25%, 1.00% , 1.30%, 2.00%, 1.00%, 1.50%, 1.25%, 1.00% and 1.00% for Class 1, Class 2, Class A, Class C, Advisor Class, Class R, Class K, Class I and Class Z shares, respectively. These waivers/reimbursements may not be terminated before January 29, 2016 and may be extended by the Adviser for additional one-year terms. Absent reimbursements or waivers, performance would have been lower, with the exception of Class 1, Class 2, Class K, Class I and Class Z shares, as these share classes are currently operating below their respective contractual expense caps. The Financial Highlights section of this report sets forth expense ratio data for the current reporting period; the expense ratios shown above may differ from the expense ratios in the Financial Highlights sections since they are based on different time periods.

* Class 1 shares are only available to Bernstein Global Wealth Management private client accounts. Class 2 shares are only available to the Adviser’s institutional clients or through other limited arrangements.

^†  Inception dates: 3/8/2010 for all share classes excluding Class Z shares; 1/31/2014 for Class Z shares.

^‡  These share classes are offered at NAV to eligible investors and their SEC returns are the same as their NAV returns. Please note that these share classes are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Fund. The inception dates for these share classes are listed above.

See Disclosures, Risks and Note about Historical Performance on pages 4-6.

(Historical Performance continued on next page)

10 •  AB ALL MARKET REAL RETURN PORTFOLIO

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

SEC AVERAGE ANNUAL RETURNS AS OF THE MOST RECENT CALENDAR QUARTER-END SEPTEMBER 30, 2015 (unaudited)
	SEC Returns (reflects applicable sales charges)
Class 1 Shares*
1 Year		-26.71	%
5 Years		-4.43	%
Since Inception†		-2.88	%
Class 2 Shares*
1 Year		-26.44	%
5 Years		-4.19	%
Since Inception†		-2.63	%
Class A Shares
1 Year		-29.93	%
5 Years		-5.33	%
Since Inception†		-3.69	%
Class C Shares
1 Year		-28.00	%
5 Years		-5.17	%
Since Inception†		-3.62	%
Advisor Class Shares‡
1 Year		-26.59	%
5 Years		-4.23	%
Since Inception†		-2.67	%
Class R Shares‡
1 Year		-27.00	%
5 Years		-4.71	%
Since Inception†		-3.15	%
Class K Shares‡
1 Year		-26.76	%
5 Years		-4.44	%
Since Inception†		-2.89	%
Class I Shares‡
1 Year		-26.46	%
5 Years		-4.20	%
Since Inception†		-2.64	%
Class Z Shares‡
1 Year		-26.52	%
Since Inception†		-15.88	%

* Class 1 shares are only available to Bernstein Global Wealth Management private client accounts. Class 2 shares are only available to the Adviser’s institutional clients or through other limited arrangements.

^† Inception dates: 3/8/2010 for all share classes excluding Class Z shares; 1/31/2014 for Class Z shares.

^‡  Please note that these share classes are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Fund. The inception dates for these share classes are listed above.

See Disclosures, Risks and Note about Historical Performance on pages 4-6.

AB ALL MARKET REAL RETURN PORTFOLIO  • 11

Historical Performance

EXPENSE EXAMPLE

(unaudited)

As a shareholder of a mutual fund, you may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, contingent deferred sales charges on redemptions and (2) ongoing costs, including management fees; distribution (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period as indicated below.

Actual Expenses

The table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed annual rate of return of 5% before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds by comparing this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), or contingent deferred sales charges on redemptions. Therefore, the hypothetical example is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Beginning Account Value May 1, 2015		Ending Account Value October 31, 2015		Expenses Paid During Period*		Annualized Expense Ratio*
Class A
Actual	$	1,000	$	849.50	$	6.06		1.30	%
Hypothetical**	$	1,000	$	1,018.65	$	6.61		1.30	%
Class C
Actual	$	1,000	$	846.20	$	9.31		2.00	%
Hypothetical**	$	1,000	$	1,015.12	$	10.16		2.00	%
Advisor Class
Actual	$	1,000	$	850.40	$	4.66		1.00	%
Hypothetical**	$	1,000	$	1,020.16	$	5.09		1.00	%
Class R
Actual	$	1,000	$	848.30	$	6.99		1.50	%
Hypothetical**	$	1,000	$	1,017.64	$	7.63		1.50	%
Class K
Actual	$	1,000	$	849.50	$	5.83		1.25	%
Hypothetical**	$	1,000	$	1,018.90	$	6.36		1.25	%

12 •  AB ALL MARKET REAL RETURN PORTFOLIO

Expense Example

EXPENSE EXAMPLE

(unaudited)

(continued from previous page)

	Beginning Account Value May 1, 2015		Ending Account Value October 31, 2015		Expenses Paid During Period*		Annualized Expense Ratio*
Class I
Actual	$	1,000	$	850.80	$	4.43		0.95	%
Hypothetical**	$	1,000	$	1,020.42	$	4.84		0.95	%
Class 1
Actual	$	1,000	$	849.90	$	5.46		1.17	%
Hypothetical**	$	1,000	$	1,019.31	$	5.96		1.17	%
Class 2
Actual	$	1,000	$	851.80	$	4.34		0.93	%
Hypothetical**	$	1,000	$	1,020.52	$	4.74		0.93	%
Class Z
Actual	$	1,000	$	851.00	$	4.53		0.97	%
Hypothetical**	$	1,000	$	1,020.32	$	4.94		0.97	%

* Expenses are equal to the Portfolio’s annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).

** Assumes 5% annual return before expenses.

AB ALL MARKET REAL RETURN PORTFOLIO  • 13

Expense Example

PORTFOLIO SUMMARY

October 31, 2015 (unaudited)

PORTFOLIO STATISTICS

Net Assets ($mil): $545.5

PORTFOLIO BREAKDOWN*
Commodity Related Derivatives	41.9	%
Commodity Related Stocks	33.2	%
Real Estate Stocks	22.8	%
Other	2.1	%

* All data are as of October 31, 2015. The portfolio breakdown is expressed as an approximate percentage of the Fund’s net assets inclusive of derivative exposure, based on the Advisor’s internal classification guidelines.

^†  The Fund’s security type breakdown is expressed as a percentage of total investments and may vary over time. The Fund also enters into derivative transactions, which may be used for hedging or investment purposes (see “Portfolio of Investments” section of the report for additional details).

14 •  AB ALL MARKET REAL RETURN PORTFOLIO

Portfolio Summary

TEN LARGEST EQUITY HOLDINGS^*

October 31, 2015 (unaudited)

Company	U.S. $ Value		Percent of Net Assets
Exxon Mobil Corp.	$	26,680,920		4.9	%
Royal Dutch Shell PLC		17,254,569		3.2
SPDR S&P Dividend ETF		16,906,738		3.1
TOTAL SA		13,494,286		2.5
Chevron Corp.		13,106,986		2.4
Vanguard Dividend Appreciation ETF		11,005,232		2.0
BP PLC		9,979,610		1.8
BG Group PLC		8,931,043		1.6
EOG Resources, Inc.		6,191,845		1.2
ConocoPhillips		4,986,144		0.9
	$	128,537,373		23.6	%

* Long-term investments.

AB ALL MARKET REAL RETURN PORTFOLIO  • 15

Ten Largest Equity Holdings

CONSOLIDATED PORTFOLIO OF INVESTMENTS

October 31, 2015

Company	Shares		U.S. $ Value
COMMON STOCKS – 55.7%
Energy – 23.8%
Coal & Consumable Fuels – 0.1%
Cameco Corp.		16,995	$	240,706
China Shenhua Energy Co., Ltd. – Class H		167,800		282,328
CONSOL Energy, Inc.		9,714		64,695
				587,729
Integrated Oil & Gas – 15.7%
BG Group PLC		565,309		8,931,043
Chevron Corp.		144,223		13,106,986
China Petroleum & Chemical Corp. – Class H		1,548,000		1,115,867
Exxon Mobil Corp.		322,467		26,680,919
Galp Energia SGPS SA		72,670		784,470
LUKOIL PJSC (Sponsored ADR)		52,530		1,904,213
Petroleo Brasileiro SA (ADR)(a)		24,520		119,658
Petroleo Brasileiro SA (Sponsored ADR)(a)		637,950		2,545,421
Royal Dutch Shell PLC (Euronext Amsterdam) – Class A		233,826		6,125,170
Royal Dutch Shell PLC – Class A		187,621		4,898,287
Royal Dutch Shell PLC – Class B		237,966		6,231,112
TOTAL SA		279,045		13,494,286
				85,937,432
Oil & Gas Equipment & Services – 0.6%
Aker Solutions ASA(b)		150,950		606,299
Deep Sea Supply PLC		547,947		115,876
Helix Energy Solutions Group, Inc.(a)		56,570		326,975
Petrofac Ltd.		89,160		1,156,873
RPC, Inc.		39,140		431,714
Schlumberger Ltd.		7,870		615,119
				3,252,856
Oil & Gas Exploration & Production – 7.0%
Anadarko Petroleum Corp.		59,917		4,007,249
Apache Corp.		18,183		856,965
Cabot Oil & Gas Corp.		19,937		432,832
Canadian Natural Resources Ltd.		152,156		3,528,120
CNOOC Ltd.		2,481,200		2,796,094
Concho Resources, Inc.(a)		5,747		666,135
ConocoPhillips		93,461		4,986,144
Det Norske Oljeselskap ASA(a)		167,277		1,035,452
Devon Energy Corp.		18,749		786,146
EOG Resources, Inc.		72,124		6,191,845
EQT Corp.		7,330		484,293
Hess Corp.		49,323		2,772,446
Inpex Corp.		98,100		935,089
Marathon Oil Corp.		32,568		598,600
Murphy Oil Corp.		48,310		1,373,453
Noble Energy, Inc.		20,686		741,386
Occidental Petroleum Corp.		42,760		3,187,331
Pioneer Natural Resources Co.		7,188		985,762

16 •  AB ALL MARKET REAL RETURN PORTFOLIO

Consolidated Portfolio of Investments

Company	Shares		U.S. $ Value
SM Energy Co.		28,770	$	959,480
Woodside Petroleum Ltd.		37,008		776,167
				38,100,989
Oil & Gas Refining & Marketing – 0.4%
JX Holdings, Inc.		207,900		816,352
Marathon Petroleum Corp.		12,820		664,076
Valero Energy Corp.		8,950		589,984
				2,070,412
				129,949,418
Equity: Other – 8.3%
Diversified/Specialty – 7.1%
Alexandria Real Estate Equities, Inc.		1,098		98,534
Ayala Land, Inc.		723,760		552,736
Azrieli Group		2,513		98,486
Beni Stabili SpA SIIQ		73,653		60,513
British Land Co. PLC (The)		156,733		2,099,390
Bumi Serpong Damai Tbk PT		520,600		61,255
CA Immobilien Anlagen AG(a)		43,001		843,347
Canadian Real Estate Investment Trust		1,108		36,089
CapitaLand Ltd.		175,300		386,696
CBRE Group, Inc. – Class A(a)		16,430		612,510
Central Pattana PCL		95,551		123,578
Cheung Kong Property Holdings Ltd.		102,500		718,523
China Overseas Property Holdings Ltd.(a)		90,713		15,449
Ciputra Development Tbk PT		760,173		59,985
Cofinimmo SA		1,393		155,234
Country Garden Holdings Co., Ltd.		512,000		194,475
CSR Ltd.		90,520		177,210
Dalian Wanda Commercial Properties Co., Ltd. – Class H(b)		25,700		171,526
Digital Realty Trust, Inc.		2,080		153,837
Duke Realty Corp.		63,064		1,305,425
East Japan Railway Co.		4,400		418,332
Emira Property Fund Ltd.		243,820		324,177
Evergrande Real Estate Group Ltd.		387,250		293,659
Fastighets AB Balder – Class B(a)		6,370		128,321
Fibra Uno Administracion SA de CV		171,281		375,583
Folkestone Education Trust		134,700		212,524
Fonciere Des Regions		9,022		849,200
Forest City Enterprises, Inc. – Class A(a)		3,516		77,704
Fukuoka REIT Corp.		30		48,920
Gecina SA		2,365		301,643
Globe Trade Centre SA(a)		18,162		31,583
GPT Group (The)		353,512		1,197,284
Gramercy Property Trust, Inc.		57,546		1,305,143
Great Portland Estates PLC		23,760		325,400
Growthpoint Properties Ltd.		176,642		323,606
H&R Real Estate Investment Trust		4,209		67,532
Hemfosa Fastigheter AB		53,550		580,682
Henderson Land Development Co., Ltd.		70,457		449,085

AB ALL MARKET REAL RETURN PORTFOLIO  • 17

Consolidated Portfolio of Investments

Company	Shares		U.S. $ Value
Hufvudstaden AB – Class A		7,660	$	108,232
Hulic Co., Ltd.		24,350		227,427
IMMOFINANZ AG(a)		377,200		965,579
IOI Properties Group Bhd		139,200		65,305
Kaisa Group Holdings Ltd.(a)(c)(d)		805,000		147,589
Kennedy Wilson Europe Real Estate PLC		44,413		818,866
Kiwi Property Group Ltd.		87,426		80,392
KLCCP Stapled Group		32,000		52,243
Land & Houses PCL		249,200		59,554
Land Securities Group PLC		54,350		1,119,702
Lend Lease Group		84,730		779,303
Leopalace21 Corp.(a)		43,500		231,765
Lippo Karawaci Tbk PT		1,356,600		117,739
Longfor Properties Co., Ltd.		103,200		138,538
Mah Sing Group Bhd		110,350		33,860
Mapletree Greater China Commercial Trust(b)		131,000		92,868
Merlin Properties Socimi SA		142,407		1,824,905
Mitsubishi Estate Co., Ltd.		136,600		2,929,588
Mitsui Fudosan Co., Ltd.		111,400		3,031,601
New World China Land Ltd.		184,000		122,066
New World Development Co., Ltd.		889,000		947,072
Orix JREIT, Inc.		326		438,852
Pakuwon Jati Tbk PT		1,637,000		50,677
Premier Investment Corp.		255		250,163
Pruksa Real Estate PCL		47,200		37,157
Quality Houses PCL		306,483		22,059
Redefine Properties Ltd.		294,360		245,604
Resilient Property Income Fund Ltd.		17,250		151,988
SA Corporate Real Estate Fund Nominees Pty Ltd.		424,640		159,944
SM Prime Holdings, Inc.		552,200		254,006
SP Setia Bhd Group		61,200		47,011
Sponda Oyj		16,623		70,614
Sumitomo Realty & Development Co., Ltd.		63,700		2,097,536
Summarecon Agung Tbk PT		766,300		77,561
Sun Hung Kai Properties Ltd.		181,923		2,432,430
Sunac China Holdings Ltd.		127,600		78,419
Suntec Real Estate Investment Trust		165,100		193,925
Supalai PCL		43,400		23,062
Swiss Prime Site AG (REG)(a)		4,378		334,492
United Urban Investment Corp.		333		462,005
UOL Group Ltd.		229,764		1,072,253
VEREIT, Inc.		13,915		114,938
Wallenstam AB – Class B		13,656		120,948
West China Cement Ltd.		1,596,000		272,345
WHA Corp. PCL(a)		242,000		21,909
Wharf Holdings Ltd. (The)		94,000		560,548
WP Carey, Inc.		1,351		85,613
				38,805,429

18 •  AB ALL MARKET REAL RETURN PORTFOLIO

Consolidated Portfolio of Investments

Company	Shares		U.S. $ Value
Health Care – 0.7%
HCP, Inc.		7,041	$	261,925
LTC Properties, Inc.		20,370		872,855
Omega Healthcare Investors, Inc.		2,477		85,506
Ventas, Inc.		31,505		1,692,448
Welltower, Inc.		15,290		991,862
				3,904,596
Triple Net – 0.5%
National Retail Properties, Inc.		30,770		1,169,260
Realty Income Corp.		32,554		1,610,121
				2,779,381
				45,489,406
Retail – 4.9%
Regional Mall – 1.4%
BR Malls Participacoes SA		30,640		88,903
CapitaLand Mall Trust		179,100		252,515
General Growth Properties, Inc.		7,743		224,160
Macerich Co. (The)		2,428		205,749
Multiplan Empreendimentos Imobiliarios SA		24,680		269,087
Pennsylvania Real Estate Investment Trust		49,130		1,104,443
Simon Property Group, Inc.		21,869		4,405,729
Taubman Centers, Inc.		950		73,131
Westfield Corp.		155,744		1,129,941
				7,753,658
Shopping Center/Other Retail – 3.5%
Aeon Mall Co., Ltd.		7,500		125,458
Brixmor Property Group, Inc.		31,100		796,782
Capital & Counties Properties PLC		50,198		343,539
Capitaland Malaysia Mall Trust		77,200		24,799
Citycon Oyj(a)		27,054		71,189
DDR Corp.		45,814		769,675
Federal Realty Investment Trust		1,055		151,382
Federation Centres		532,905		1,100,855
Fibra Shop Portafolios Inmobiliarios SAPI de CV		452,304		463,591
Hammerson PLC		97,153		951,877
Hyprop Investments Ltd.		43,817		397,358
IGB Real Estate Investment Trust		117,600		36,955
Iguatemi Empresa de Shopping Centers SA		4,200		23,212
Intu Properties PLC		63,418		337,595
Japan Retail Fund Investment Corp.		267		517,118
JB Hi-Fi Ltd.		31,210		397,105
Kimco Realty Corp.		6,319		169,160
Kite Realty Group Trust		35,760		944,422
Klepierre		31,406		1,487,381
Link REIT		354,923		2,120,551
Mercialys SA		29,660		681,348
Ramco-Gershenson Properties Trust		52,143		876,002
Regency Centers Corp.		1,433		97,387
Renhe Commercial Holdings Co., Ltd.(a)		1,124,000		58,565

AB ALL MARKET REAL RETURN PORTFOLIO  • 19

Consolidated Portfolio of Investments

Company	Shares		U.S. $ Value
Retail Opportunity Investments Corp.		48,980	$	888,007
RioCan Real Estate Investment Trust (Toronto)		4,875		95,069
Scentre Group		762,207		2,235,652
Smart Real Estate Investment Trust		1,703		40,452
Unibail-Rodamco SE		6,803		1,893,485
Vastned Retail NV		14,625		709,290
				18,805,261
				26,558,919
Materials – 4.8%
Aluminum – 0.0%
Alcoa, Inc.		8,039		71,789
Norsk Hydro ASA		8,263		29,596
				101,385
Commodity Chemicals – 0.4%
LyondellBasell Industries NV – Class A		14,450		1,342,549
Westlake Chemical Corp.		12,910		778,086
				2,120,635
Diversified Chemicals – 0.2%
Arkema SA		15,332		1,120,442
Diversified Metals & Mining – 1.6%
Anglo American PLC		8,560		71,816
Aurubis AG		12,360		825,647
BHP Billiton Ltd.		19,815		324,981
BHP Billiton PLC		12,945		206,913
Boliden AB		58,600		1,121,977
First Quantum Minerals Ltd.		93,030		496,596
Freeport-McMoRan, Inc.		65,550		771,523
Glencore PLC(a)		1,602,281		2,766,260
Korea Zinc Co., Ltd.		2,450		1,018,144
Lundin Mining Corp.(a)		164,300		554,117
Rio Tinto Ltd.		2,712		96,976
South32 Ltd.(a)		240,320		248,854
				8,503,804
Fertilizers & Agricultural Chemicals – 0.3%
Mosaic Co. (The)		10,277		347,260
Potash Corp. of Saskatchewan, Inc.		25,758		521,621
Syngenta AG (REG)		2,885		969,274
				1,838,155
Forest Products – 0.0%
West Fraser Timber Co., Ltd.		2,139		75,689
Gold – 0.9%
Agnico Eagle Mines Ltd.		36,985		1,045,400
Barrick Gold Corp.		36,777		282,662
Franco-Nevada Corp.		4,927		249,892
Goldcorp, Inc.		97,736		1,250,477
Koza Altin Isletmeleri AS		58,010		325,641
Newcrest Mining Ltd.(a)		25,207		219,585

20 •  AB ALL MARKET REAL RETURN PORTFOLIO

Consolidated Portfolio of Investments

Company	Shares		U.S. $ Value
Newmont Mining Corp.		16,723	$	325,429
Randgold Resources Ltd.		13,550		908,756
Real Gold Mining Ltd.(a)(c)(d)		124,500		– 0	–
				4,607,842
Paper Packaging – 0.2%
Smurfit Kappa Group PLC		31,450		897,031
Paper Products – 0.3%
International Paper Co.		12,463		532,045
Mondi PLC		36,406		841,857
Stora Enso Oyj – Class R		17,103		158,651
UPM-Kymmene Oyj		16,584		310,469
				1,843,022
Precious Metals & Minerals – 0.0%
Fresnillo PLC		6,977		78,257
Industrias Penoles SAB de CV		4,412		58,445
				136,702
Silver – 0.1%
Silver Wheaton Corp.		55,735		757,427
Specialty Chemicals – 0.1%
Johnson Matthey PLC		13,420		533,770
Steel – 0.7%
ArcelorMittal (Euronext Amsterdam)		6,143		34,304
JFE Holdings, Inc.		3,072		48,293
Nippon Steel & Sumitomo Metal Corp.		4,700		95,281
Novolipetsk Steel OJSC (GDR)(b)		67,720		830,430
Nucor Corp.		1,959		82,866
POSCO		429		68,988
Severstal PAO (GDR)(b)		53,830		631,584
ThyssenKrupp AG		2,253		45,398
Vale SA (Preference Shares)		11,633		42,318
Vale SA (Sponsored ADR) (Local Preference Shares)		365,030		1,314,108
voestalpine AG		16,120		582,837
				3,776,407
				26,312,311
Residential – 4.3%
Multi-Family – 3.4%
Advance Residence Investment Corp.		88		187,770
Apartment Investment & Management Co. – Class A		2,402		94,134
AvalonBay Communities, Inc.		13,146		2,298,315
Boardwalk Real Estate Investment Trust		610		25,061
BUWOG AG(a)		3,509		74,606
Camden Property Trust		1,328		97,993
Canadian Apartment Properties REIT		1,814		37,345
China Overseas Land & Investment Ltd.		272,140		878,976

AB ALL MARKET REAL RETURN PORTFOLIO  • 21

Consolidated Portfolio of Investments

Company	Shares		U.S. $ Value
China Resources Land Ltd.		639,908	$	1,662,857
China Vanke Co., Ltd. – Class H		632,874		1,480,152
CIFI Holdings Group Co., Ltd.		1,414,000		301,751
Comforia Residential REIT, Inc.		95		182,003
Corp. GEO SAB de CV Series B(a)(c)(d)		23,600		– 0	–^
Cyrela Brazil Realty SA Empreendimentos e Participacoes		18,900		43,896
Desarrolladora Homex SAB de CV(a)		1,460		703
Deutsche Wohnen AG		23,396		659,513
Emlak Konut Gayrimenkul Yatirim Ortakligi AS		562,503		544,912
Equity LifeStyle Properties, Inc.		1,173		70,943
Equity Residential		14,239		1,100,959
Essex Property Trust, Inc.		6,288		1,386,127
Ichigo Office REIT Investment		450		311,089
Independence Realty Trust, Inc.		51,740		405,642
Japan Rental Housing Investments, Inc.		319		213,400
KWG Property Holding Ltd.		758,000		544,627
LEG Immobilien AG(a)		3,949		314,835
LPN Development PCL		40,800		20,496
Mid-America Apartment Communities, Inc.		14,676		1,250,249
MRV Engenharia e Participacoes SA		20,250		38,948
Shenzhen Investment Ltd.		210,000		84,956
Shimao Property Holdings Ltd.		88,500		154,314
Sino-Ocean Land Holdings Ltd.		261,080		150,739
Stockland		163,164		468,289
Sun Communities, Inc.		11,036		739,633
UDR, Inc.		3,981		137,185
UNITE Group PLC (The)		38,980		398,915
Urbi Desarrollos Urbanos SAB de CV(a)(c)(d)		120,400		– 0	–^
Vonovia SE		41,451		1,381,725
Wing Tai Holdings Ltd.		671,300		835,381
Yuexiu Property Co., Ltd.		444,000		76,497
				18,654,936
Self Storage – 0.9%
Big Yellow Group PLC		51,520		594,739
CubeSmart		36,490		1,015,152
Extra Space Storage, Inc.		14,533		1,151,595
National Storage Affiliates Trust		39,951		600,863
Public Storage		5,319		1,220,497
Safestore Holdings PLC		86,780		435,454
				5,018,300
				23,673,236
Office – 2.4%
Office – 2.4%
Allied Properties Real Estate Investment Trust		21,418		587,701
alstria office REIT-AG(a)		80,173		1,118,626
Ascendas India Trust		48,900		30,543
Befimmo SA		1,162		77,753
Boston Properties, Inc.		16,128		2,029,708
Castellum AB		11,330		169,582

22 •  AB ALL MARKET REAL RETURN PORTFOLIO

Consolidated Portfolio of Investments

Company	Shares		U.S. $ Value
Cominar Real Estate Investment Trust		2,545	$	29,934
Derwent London PLC		6,880		410,894
Dream Office Real Estate Investment Trust		30,451		488,809
Entra ASA(b)		4,315		36,680
Fabege AB		9,141		145,221
Highwoods Properties, Inc.		14,590		633,935
Hongkong Land Holdings Ltd.		204,200		1,531,130
Hudson Pacific Properties, Inc.		17,410		497,404
ICADE		8,940		660,644
Inmobiliaria Colonial SA(a)		115,812		85,649
Investa Office Fund		117,040		334,978
Japan Prime Realty Investment Corp.		114		371,090
Japan Real Estate Investment Corp.		86		397,533
Kenedix Office Investment Corp. – Class A		138		632,604
Kilroy Realty Corp.		1,353		89,082
Liberty Property Trust		13,017		442,838
Mori Hills REIT Investment Corp.		166		205,387
Nippon Building Fund, Inc.		93		441,683
Norwegian Property ASA(a)		17,050		18,459
PSP Swiss Property AG (REG)(a)		2,749		239,136
SL Green Realty Corp.		1,530		181,489
Tokyo Tatemono Co., Ltd.		14,200		176,440
Vornado Realty Trust		2,605		261,933
Workspace Group PLC		32,290		475,579
				12,802,444
Oil, Gas & Consumable Fuels – 1.8%
Integrated Oil & Gas – 1.8%
BP PLC		1,679,225		9,979,610
Industrials – 1.5%
Industrial Warehouse Distribution – 1.1%
Ascendas Real Estate Investment Trust		135,900		231,374
DCT Industrial Trust, Inc.		26,750		992,960
Global Logistic Properties Ltd.		210,700		336,994
GLP J-Reit		398		396,034
Granite Real Estate Investment Trust		27,908		807,099
Japan Logistics Fund, Inc.		136		254,338
Mapletree Logistics Trust		432,309		314,426
Mexico Real Estate Management SA de CV(a)		381,186		527,547
PLA Administradora Industrial S de RL de CV(a)		170,060		313,088
Prologis, Inc.		27,806		1,188,150
Segro PLC		51,239		354,939
Warehouses De Pauw CVA		6,013		492,248
				6,209,197
Mixed Office Industrial – 0.4%
BR Properties SA		13,240		40,500
Goodman Group		325,312		1,395,708
Green REIT PLC		45,618		78,815
Kungsleden AB		76,834		575,449
				2,090,472
				8,299,669

AB ALL MARKET REAL RETURN PORTFOLIO  • 23

Consolidated Portfolio of Investments

Company	Shares		U.S. $ Value
Lodging – 1.0%
Lodging – 1.0%
Ashford Hospitality Trust, Inc.		119,896	$	824,884
Chesapeake Lodging Trust		31,910		878,801
Host Hotels & Resorts, Inc.		11,624		201,444
Japan Hotel REIT Investment Corp.		335		232,676
Pebblebrook Hotel Trust		24,550		839,119
RLJ Lodging Trust		44,840		1,125,036
Summit Hotel Properties, Inc.		67,010		876,491
Wyndham Worldwide Corp.		5,070		412,445
				5,390,896
Metals & Mining – 0.9%
Diversified Metals & Mining – 0.9%
Rio Tinto PLC		129,249		4,710,509
Chemicals – 0.8%
Fertilizers & Agricultural Chemicals – 0.8%
CF Industries Holdings, Inc.		33,572		1,704,450
Monsanto Co.		30,444		2,837,990
				4,542,440
Food Products – 0.4%
Agricultural Products – 0.4%
Archer-Daniels-Midland Co.		43,569		1,989,361
Real Estate – 0.3%
Developers – 0.1%
Daelim Industrial Co., Ltd.		4,240		276,812
Diversified Real Estate Activities – 0.2%
MMC Norilsk Nickel PJSC (ADR)		99,470		1,482,103
				1,758,915
Mortgage – 0.2%
Mortgage – 0.2%
Blackstone Mortgage Trust, Inc. – Class A		14,360		395,187
Concentradora Hipotecaria SAPI de CV		251,130		393,013
First American Financial Corp.		10,240		390,451
				1,178,651
Food Beverage & Tobacco – 0.2%
Agricultural Products – 0.1%
Bunge Ltd.		4,514		329,342
Packaged Foods & Meats – 0.1%
Tyson Foods, Inc. – Class A		12,240		542,966
				872,308
Financial:Other – 0.1%
Financial:Other – 0.1%
HFF, Inc. – Class A		11,240		388,005
Total Common Stocks (cost $336,067,020)				303,896,098

24 •  AB ALL MARKET REAL RETURN PORTFOLIO

Consolidated Portfolio of Investments

Company		Principal Amount (000)		U.S. $ Value
INFLATION-LINKED SECURITIES – 25.2%
United States – 25.2%
U.S. Treasury Inflation Index 0.125%, 4/15/16 (TIPS)(e)(f)	U.S.$		134,482	$	133,632,788
0.625%, 7/15/21 (TIPS)			3,714		3,769,544
Total Inflation-Linked Securities (cost $139,018,158)					137,402,332
		Shares
INVESTMENT COMPANIES – 5.5%
Funds and Investment Trusts – 5.5%
iShares US Real Estate ETF			27,630		2,082,197
SPDR S&P Dividend ETF			217,450		16,906,737
Vanguard Dividend Appreciation ETF			139,820		11,005,232
Total Investment Companies (cost $29,618,076)					29,994,166
WARRANTS – 0.2%
Materials – 0.2%
Fertilizers & Agricultural Chemicals – 0.2%
UPL Ltd., Deutsche Bank, expiring 1/30/17(a)			158,480		1,113,122
Equity: Other – 0.0%
Diversified/Specialty – 0.0%
Eastern & Oriental Bhd, expiring 7/21/19(a)			12,100		605
Health Care – 0.0%
Emaar Properties PJSC, Merrill Lynch Intl & Co., expiring 9/06/18(a)			75,327		132,286
					132,891
Financial:Other – 0.0%
Financial:Other – 0.0%
DLF Ltd., Merrill Lynch Intl & Co., expiring 5/23/18(a)			29,860		53,026
Industrials – 0.0%
Industrial Warehouse Distribution – 0.0%
WHA Corp. PCL, expiring 12/14/15(a)			24,200		340
Total Warrants (cost $1,219,644)					1,299,379

AB ALL MARKET REAL RETURN PORTFOLIO  • 25

Consolidated Portfolio of Investments

Company	Shares		U.S. $ Value
SHORT-TERM INVESTMENTS – 9.1%
Investment Companies – 9.1%
AB Fixed Income Shares, Inc. – Government STIF Portfolio, 0.13%(g)(h) (cost $49,719,017)	49,719,017	$	49,719,017
Total Investments – 95.7% (cost $555,641,915)			522,310,992
Other assets less liabilities – 4.3%			23,185,510
Net Assets – 100.0%		$	545,496,502

FUTURES (see Note D)

Type	Number of Contracts		Expiration Month		Original Value		Value at October 31, 2015		Unrealized Appreciation/ (Depreciation)
Purchased Contracts
Cattle Feeder Futures		9		January 2016	$	830,258	$	824,400	$	(5,858	)
Coffee C Futures		10		December 2015		499,510		453,563		(45,947	)
Coffee Robusta Futures		30		January 2016		487,256		492,900		5,644
Gold 100 OZ Futures		104		December 2015		11,525,301		11,870,560		345,259
Lean Hogs Futures		75		December 2015		1,943,228		1,776,000		(167,228	)
LME Nickel Futures		28		December 2015		1,703,930		1,688,148		(15,782	)
LME PRI Aluminum Futures		39		December 2015		1,576,207		1,428,619		(147,588	)
LME Zinc Futures		4		December 2015		168,812		170,075		1,263
Platinum Futures		29		January 2016		1,419,870		1,434,195		14,325
Silver Futures		10		December 2015		775,008		778,350		3,342
Soybean Futures		61		January 2016		2,800,081		2,701,538		(98,543	)
Sugar 11 (World) Futures		111		February 2016		1,535,690		1,805,126		269,436
WTI Crude Futures		191		November 2017		15,443,783		10,470,620		(4,973,163	)
WTI Crude Futures		355		November 2018		28,647,847		20,220,800		(8,427,047	)
WTI Crude Futures		178		November 2019		12,406,385		10,412,999		(1,993,386	)
Sold Contracts
KC HRW Wheat Futures		109		December 2015		2,710,556		2,690,938		19,618
Live Cattle Futures		47		December 2015		2,619,853		2,664,430		(44,577	)
LME Nickel Futures		16		December 2015		971,471		964,656		6,815
LME PRI Aluminum Futures		79		December 2015		3,083,227		2,893,869		189,358
									$	(15,064,059	)

FORWARD CURRENCY EXCHANGE CONTRACTS (see Note D)

Counterparty	Contracts to Deliver (000)			In Exchange For (000)			Settlement Date		Unrealized Appreciation/ (Depreciation)
BNP Paribas SA		AUD	5,344		USD	3,752		12/15/15	$	(50,966	)
Citibank		SGD	1,769		USD	1,242		12/15/15		(18,507	)
Citibank		USD	5,658		GBP	3,713		12/15/15		65,270
Citibank		USD	7,623		NOK	62,169		12/15/15		(311,407	)
Deutsche Bank AG		AUD	3,963		USD	2,907		12/15/15		86,620

26 •  AB ALL MARKET REAL RETURN PORTFOLIO

Consolidated Portfolio of Investments

Counterparty	Contracts to Deliver (000)			In Exchange For (000)			Settlement Date		Unrealized Appreciation/ (Depreciation)
Deutsche Bank AG		EUR	4,150		USD	4,551		12/15/15	$	(15,538	)
Deutsche Bank AG		GBP	2,009		USD	3,047		12/15/15		(49,156	)
Goldman Sachs Bank USA		USD	12,014		RUB	757,555		11/25/15		(228,109	)
Goldman Sachs Bank USA		KRW	776,074		USD	651		12/15/15		(27,760	)
HSBC Bank USA		BRL	5,216		USD	1,331		12/15/15		(3,487	)
HSBC Bank USA		HKD	10,644		USD	1,373		12/15/15		(431	)
JPMorgan Chase Bank		AUD	3,577		USD	2,504		12/15/15		(41,199	)
JPMorgan Chase Bank		JPY	309,133		USD	2,583		12/15/15		19,258
JPMorgan Chase Bank		JPY	842,890		USD	6,970		12/15/15		(19,246	)
JPMorgan Chase Bank		USD	2,649		AUD	3,649		12/15/15		(52,835	)
Morgan Stanley & Co., Inc.		GBP	2,343		USD	3,601		12/15/15		(10,674	)
Morgan Stanley & Co., Inc.		INR	55,489		USD	820		12/15/15		(22,532	)
Morgan Stanley & Co., Inc.		JPY	156,932		USD	1,305		12/15/15		3,894
Morgan Stanley & Co., Inc.		USD	11,417		NZD	17,153		12/15/15		162,561
Northern Trust Company		EUR	1,975		USD	2,221		12/15/15		47,473
Northern Trust Company		NOK	7,754		USD	941		12/15/15		29,419
Royal Bank of Scotland PLC		CAD	16,071		USD	12,145		12/15/15		(142,122	)
Royal Bank of Scotland PLC		CNY	66,842		USD	10,185		12/15/15		(327,938	)
Royal Bank of Scotland PLC		EUR	20,024		USD	22,438		12/15/15		404,189
Royal Bank of Scotland PLC		NOK	18,885		USD	2,289		12/15/15		67,795
Royal Bank of Scotland PLC		NZD	17,211		USD	11,274		12/15/15		(344,531	)
Royal Bank of Scotland PLC		RUB	320,474		USD	4,707		12/15/15		(249,787	)
Royal Bank of Scotland PLC		USD	5,382		EUR	4,752		12/15/15		(152,719	)
Royal Bank of Scotland PLC		USD	10,636		JPY	1,274,123		12/15/15		(70,273	)
Standard Chartered Bank		GBP	1,264		USD	1,983		12/15/15		34,852
Standard Chartered Bank		USD	683		IDR	10,096,953		12/15/15		43,024
State Street Bank & Trust Co.		EUR	2,995		USD	3,356		12/15/15		60,229
State Street Bank & Trust Co.		SEK	10,036		USD	1,197		12/15/15		21,178
State Street Bank & Trust Co.		SGD	48		USD	34		12/15/15		(114	)
State Street Bank & Trust Co.		USD	1,753		CHF	1,709		12/15/15		(21,295	)
State Street Bank & Trust Co.		USD	5,440		EUR	4,896		12/15/15		(52,123	)
State Street Bank & Trust Co.		USD	1,686		GBP	1,096		12/15/15		3,363
State Street Bank & Trust Co.		USD	1,899		HKD	14,716		12/15/15		161
State Street Bank & Trust Co.		USD	512		JPY	61,246		12/15/15		(3,899	)
State Street Bank & Trust Co.		USD	603		MYR	2,611		12/15/15		3,082
State Street Bank & Trust Co.		USD	2,620		ZAR	36,491		12/15/15		(3,084	)
UBS AG		GBP	5,551		USD	8,531		12/15/15		(24,307	)
UBS AG		USD	7,431		EUR	6,523		12/15/15		(253,374	)
									$	(1,445,045	)

INFLATION (CPI) SWAPS (see Note D)

					Rate Type
Swap Counterparty	Notional Amount (000)		Termination Date		Payments made by the Fund			Payments received by the Fund			Unrealized Appreciation/ (Depreciation)
Deutsche Bank AG	$	8,719		3/25/25		2.205	%		CPI	#	$	(67,796	)
Deutsche Bank AG		38,982		3/25/25		2.205	%		CPI	#		(303,108	)
Deutsche Bank AG		46,779		3/25/25		2.205	%		CPI	#		(363,735	)
Deutsche Bank AG		18,987		3/26/25		2.195	%		CPI	#		(138,598	)
Deutsche Bank AG		37,975		3/26/25		2.170	%		CPI	#		(233,604	)

AB ALL MARKET REAL RETURN PORTFOLIO  • 27

Consolidated Portfolio of Investments

					Rate Type
Swap Counterparty	Notional Amount (000)		Termination Date		Payments made by the Fund			Payments received by the Fund			Unrealized Appreciation/ (Depreciation)
Deutsche Bank AG	$	54,500		7/30/25		2.278	%		CPI	#	$	(516,259	)
JPMorgan Chase Bank, NA		76,719		3/30/25		2.170	%		CPI	#		(464,177	)
JPMorgan Chase Bank, NA		76,719		4/01/25		2.170	%		CPI	#		(464,443	)
											$	(2,551,720	)

# Variable interest rate based on the rate of inflation as determined by the Consumer Price Index (CPI).

TOTAL RETURN SWAPS (see Note D)

Counterparty & Referenced Obligation	# of Shares or Units		Rate Paid/ Received			Notional Amount (000)		Maturity Date		Unrealized Appreciation/ (Depreciation)
Receive Total Return on Reference Obligation
Credit Suisse International Bloomberg Commodity Index 2 Months Forwards		227,233		0.11	%	$	44,487		12/15/15	$	(1,128,647	)
Goldman Sachs International Bloomberg Commodity Index 2 Months Forwards		250,000		0.11	%		48,944		12/15/15		(1,241,729	)
JPMorgan Chase Bank, NA Bloomberg Commodity Index 2 Months Forwards		26,693		0.11	%		5,130		12/15/15		(36,051	)
Bloomberg Commodity Index 2 Months Forwards		18,121		0.11	%		3,548		12/15/15		(89,680	)
Bloomberg Commodity Index 2 Months Forwards		432,632		0.11	%		84,700		12/15/15		(2,148,847	)
Pay Total Return on Reference Obligation
JPMorgan Chase Bank, NA BBG WTI Crude Oil Index		102,626		0.05	%		10,950		1/15/16		50,254
										$	(4,594,700	)

28 •  AB ALL MARKET REAL RETURN PORTFOLIO

Consolidated Portfolio of Investments

^ Amount less than $0.50.

(a) Non-income producing security.

(b) Security is exempt from registration under Rule 144A of the Securities Act of 1933. These securities are considered liquid and may be resold in transactions exempt from registration, normally to qualified institutional buyers. At October 31, 2015, the aggregate market value of these securities amounted to $2,369,387 or 0.4% of net assets.

(c) Fair valued by the Adviser.

(d) Illiquid security.

(e) Position, or a portion thereof, has been segregated to collateralize margin requirements for open futures contracts.

(f) Position, or a portion thereof, has been segregated to collateralize OTC derivatives outstanding.

(g) To obtain a copy of the fund’s financial statements, please go to the Securities and Exchange Commission’s website at www.sec.gov, or call AB at (800) 227-4618.

(h) Investment in affiliated money market mutual fund. The rate shown represents the 7-day yield as of period end.

Currency Abbreviations:

AUD – Australian Dollar

BRL – Brazilian Real

CAD – Canadian Dollar

CHF – Swiss Franc

CNY – Chinese Yuan Renminbi

EUR – Euro

GBP – Great British Pound

HKD – Hong Kong Dollar

IDR – Indonesian Rupiah

INR – Indian Rupee

JPY – Japanese Yen

KRW – South Korean Won

MYR – Malaysian Ringgit

NOK – Norwegian Krone

NZD – New Zealand Dollar

RUB – Russian Ruble

SEK – Swedish Krona

SGD – Singapore Dollar

USD – United States Dollar

ZAR – South African Rand

Glossary:

ADR – American Depositary Receipt

ETF – Exchange Traded Fund

GDR – Global Depositary Receipt

KC HRW – Kansas City Hard Red Winter

LME – London Metal Exchange

OJSC – Open Joint Stock Company

PJSC – Public Joint Stock Company

REG – Registered Shares

REIT – Real Estate Investment Trust

SPDR – Standard & Poor’s Depository Receipt

TIPS – Treasury Inflation Protected Security

WTI – West Texas Intermediate

See notes to consolidated financial statements.

AB ALL MARKET REAL RETURN PORTFOLIO  • 29

Consolidated Portfolio of Investments

CONSOLIDATED STATEMENT OF ASSETS & LIABILITIES

October 31, 2015

Assets
Investments in securities, at value
Unaffiliated issuers (cost $505,922,898)	$	472,591,975
Affiliated issuers (cost $49,719,017)		49,719,017
Cash		457,794
Cash collateral due from broker		4,739,428
Foreign currencies, at value (cost $22,806,326)		22,479,143
Receivable for investment securities sold and foreign currency transactions		3,684,810
Receivable for capital stock sold		1,196,852
Unrealized appreciation on forward currency exchange contracts		1,052,368
Dividends and interest receivable		495,175
Receivable for variation margin on exchange-traded derivatives		113,358
Unrealized appreciation on total return swaps		50,254
Receivable for terminated total return swaps		16,105
Total assets		556,596,279
Liabilities
Unrealized depreciation on inflation swaps		2,551,720
Unrealized depreciation on total return swaps		4,644,954
Unrealized depreciation on forward currency exchange contracts		2,497,413
Payable for investment securities purchased		449,111
Payable for capital stock redeemed		224,952
Management fee payable		309,300
Distribution fee payable		109,534
Transfer Agent fee payable		43,587
Administrative fee payable		15,124
Accrued expenses and other liabilities		254,082
Total liabilities		11,099,777
Net Assets	$	545,496,502
Composition of Net Assets
Capital stock, at par	$	67,725
Additional paid-in capital		652,019,426
Undistributed net investment income		7,271,555
Accumulated net realized loss on investment and foreign currency transactions		(56,532,567	)
Net unrealized depreciation on investments and foreign currency denominated assets and liabilities		(57,329,637	)
	$	545,496,502

See notes to consolidated financial statements.

30 •  AB ALL MARKET REAL RETURN PORTFOLIO

Consolidated Statement of Assets & Liabilities

Net Asset Value Per Share—30 billion shares of capital stock authorized, $.001 par value

Class	Net Assets		Shares Outstanding		Net Asset Value
A	$	16,610,699		2,043,157	$	8.13	*
C	$	4,202,139		522,994	$	8.03
Advisor	$	30,541,177		3,755,310	$	8.13
R	$	162,267		20,144	$	8.06
K	$	1,667,321		206,501	$	8.07
I	$	14,508,096		1,789,941	$	8.11
1	$	474,631,103		58,995,365	$	8.05
2	$	8,221		1,000	$	8.22
Z	$	3,165,479		390,303	$	8.11

* The maximum offering price per share for Class A shares was $8.49 which reflects a sales charge of 4.25%.

See notes to consolidated financial statements.

AB ALL MARKET REAL RETURN PORTFOLIO  • 31

Consolidated Statement of Assets & Liabilities

CONSOLIDATED STATEMENT OF OPERATIONS

Year Ended October 31, 2015

Investment Income
Dividends
Unaffiliated issuers (net of foreign taxes withheld of $784,283)	$	12,041,343
Affiliated issuers		73,768
Interest*		(862,776	)	$	11,252,335
Expenses
Management fee (see Note B)		4,332,368
Distribution fee—Class A		62,789
Distribution fee—Class C		61,367
Distribution fee—Class R		820
Distribution fee—Class K		4,777
Distribution fee—Class 1		1,232,120
Transfer agency—Class A		57,905
Transfer agency—Class C		16,259
Transfer agency—Advisor Class		107,185
Transfer agency—Class R		400
Transfer agency—Class K		3,592
Transfer agency—Class I		10,527
Transfer agency—Class 1		44,179
Transfer agency—Class Z		181
Custodian		291,251
Registration fees		168,700
Audit and tax		112,486
Printing		76,804
Administrative		49,900
Legal		46,596
Directors’ fees		18,777
Miscellaneous		97,193
Total expenses		6,796,176
Less: expenses waived and reimbursed by the Adviser (see Note B)		(114,288	)
Net expenses					6,681,888
Net investment income					4,570,447
Realized and Unrealized Gain (Loss) on Investment and Foreign Currency Transactions
Net realized gain (loss) on:
Investment transactions					(28,790,814	)(a)
Futures					(7,671,107	)
Options written					(2,983,656	)
Swaps					(61,307,078	)
Foreign currency transactions					8,142,059
Net change in unrealized appreciation/depreciation of:
Investments					(29,553,767	)(b)
Futures					(11,071,414	)
Swaps					(3,715,068	)
Foreign currency denominated assets and liabilities					(4,506,371	)
Net loss on investment and foreign currency transactions					(141,457,216	)
Contributions from Affiliates (see Note B)					306
Net Decrease in Net Assets from Operations				$	(136,886,463	)

(a) Net of foreign capital gains taxes of $68,911.

(b) Net of decrease in accrued foreign capital gains taxes of $36,480.

* The negative interest income reflects interest income adjusted for fluctuation in the inflation index related to TIPS and amortization of premiums.

See notes to consolidated financial statements.

32 •  AB ALL MARKET REAL RETURN PORTFOLIO

Consolidated Statement of Operations

CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS

	Year Ended October 31, 2015			Year Ended October 31, 2014
Increase (Decrease) in Net Assets from Operations
Net investment income	$	4,570,447		$	7,307,282
Net realized loss on investment transactions and foreign currency transactions		(92,610,596	)		(1,755,935	)
Net change in unrealized appreciation/depreciation of investments and foreign currency denominated assets and liabilities		(48,846,620	)		(28,674,070	)
Contributions from Affiliates (see Note B)		306			119,942
Net decrease in net assets from operations		(136,886,463	)		(23,002,781	)
Dividends to Shareholders from
Net investment income
Class A		(483,613	)		(792,091	)
Class C		(100,388	)		(58,007	)
Advisor Class		(1,240,758	)		(985,378	)
Class R		(4,403	)		(423	)
Class K		(50,051	)		(26,710	)
Class I		(452,178	)		(354,919	)
Class 1		(12,070,530	)		(6,782,380	)
Class 2		(270	)		(161	)
Class Z		(254	)		– 0	–
Capital Stock Transactions
Net increase		64,070,635			80,314,554
Total increase (decrease)		(87,218,273	)		48,311,704
Net Assets
Beginning of period		632,714,775			584,403,071
End of period (including undistributed net investment income of $7,271,555 and $7,153,574, respectively)	$	545,496,502		$	632,714,775

See notes to consolidated financial statements.

AB ALL MARKET REAL RETURN PORTFOLIO  • 33

Consolidated Statement of Changes in Net Assets

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2015

NOTE A

Significant Accounting Policies

AB Bond Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940 as an open-end management investment company. Prior to January 20, 2015, the Fund was known as AllianceBernstein Bond Fund, Inc. The Fund, which is a Maryland corporation, operates as a series company comprised of nine portfolios currently in operation: the AB Intermediate Bond Portfolio, the AB Bond Inflation Strategy Portfolio, the AB Municipal Bond Inflation Strategy Portfolio, the AB All Market Real Return Portfolio (formerly AllianceBernstein Real Asset Strategy), the AB Limited Duration High Income Portfolio, the AB Government Reserves Portfolio, the AB Tax-Aware Fixed Income Portfolio, the AB Credit Long/Short Portfolio and the AB High Yield Portfolio. They are each diversified Portfolios, with the exception of the AB Credit Long/Short Portfolio and the AB High Yield Portfolio, which are non-diversified. Each Portfolio is considered to be a separate entity for financial reporting and tax purposes. This report relates only to the AB All Market Real Return Portfolio (the “Portfolio”). Prior to January 20, 2015, the Portfolio was known as AllianceBernstein Real Asset Strategy. As part of the Portfolio’s investment strategy, the Portfolio seeks to gain exposure to commodities and commodities-related instruments and derivatives primarily through investments in AllianceBernstein Cayman Inflation Strategy, Ltd., a wholly-owned subsidiary of the Portfolio organized under the laws of the Cayman Islands (the “Subsidiary”). The Portfolio and the Subsidiary commenced operations on March 8, 2010. The Subsidiary was incorporated on February 1, 2010. The Portfolio is the sole shareholder of the Subsidiary and it is intended that the Portfolio will remain the sole shareholder and will continue to control the Subsidiary. Under the Articles of Association of the Subsidiary, shares issued by the Subsidiary confer upon a shareholder the right to receive notice of, to attend and to vote at general meetings of the Subsidiary and shall confer upon the shareholder rights in a winding-up or repayment of capital and the right to participate in the profits or assets of the Subsidiary. As of October 31, 2015, net assets of the Portfolio were $545,496,502, of which $100,984,733, or 19%, represented the Portfolio’s ownership of all issued shares and voting rights of the Subsidiary. This report presents the consolidated financial statements of AB All Market Real Return Portfolio and the Subsidiary. All intercompany transactions and balances have been eliminated in consolidation. The Portfolio has authorized the issuance of Class A, Class B, Class C, Advisor Class, Class R, Class K, Class I, Class 1, Class 2 and Class Z shares. Class B shares are not publically offered. Class 1 shares are sold only to the private clients of Sanford C. Bernstein & Co. LLC by its registered representatives. As of October 31, 2015, AllianceBernstein L.P. (the “Adviser”), was the sole shareholder of Class 2 shares. Class A shares are sold with a front-end sales charge of up to 4.25% for purchases not exceeding $1,000,000. With respect to purchases of $1,000,000 or more, Class A shares redeemed within one year of purchase may be subject to a contingent deferred sales charge of 1%. Class C shares are subject to a contingent deferred sales

34 •  AB ALL MARKET REAL RETURN PORTFOLIO

Notes to Consolidated Financial Statements

charge of 1% on redemptions made within the first year after purchase. Class R, Class K, Class 1, and Class Z shares are sold without an initial or contingent deferred sales charge. Advisor Class, Class I, and Class 2 shares are sold without an initial or contingent deferred sales charge and are not subject to ongoing distribution expenses. All ten classes of shares have identical voting, dividend, liquidation and other rights, except that the classes bear different distribution and transfer agency expenses. Each class has exclusive voting rights with respect to its distribution plan. The consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) which require management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities in the consolidated financial statements and amounts of income and expenses during the reporting period. Actual results could differ from those estimates. The Portfolio is an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. The following is a summary of significant accounting policies followed by the Portfolio.

1. Security Valuation

Portfolio securities are valued at their current market value determined on the basis of market quotations or, if market quotations are not readily available or are deemed unreliable, at “fair value” as determined in accordance with procedures established by and under the general supervision of the Fund’s Board of Directors (the “Board”).

In general, the market values of securities which are readily available and deemed reliable are determined as follows: securities listed on a national securities exchange (other than securities listed on the NASDAQ Stock Market, Inc. (“NASDAQ”)) or on a foreign securities exchange are valued at the last sale price at the close of the exchange or foreign securities exchange. If there has been no sale on such day, the securities are valued at the last traded price from the previous day. Securities listed on more than one exchange are valued by reference to the principal exchange on which the securities are traded; securities listed only on NASDAQ are valued in accordance with the NASDAQ Official Closing Price; listed or over the counter (“OTC”) market put or call options are valued at the mid level between the current bid and ask prices. If either a current bid or current ask price is unavailable, the Adviser will have discretion to determine the best valuation (e.g. last trade price in the case of listed options); open futures are valued using the closing settlement price or, in the absence of such a price, the most recent quoted bid price. If there are no quotations available for the day of valuation, the last available closing settlement price is used; U.S. Government securities and any other debt instruments having 60 days or less remaining until maturity are generally valued at market by an independent pricing vendor, if a market price is available. If a market price is not available, the securities are valued at amortized cost. This methodology is commonly used for short term securities that have an original maturity of 60 days or less, as well as

AB ALL MARKET REAL RETURN PORTFOLIO  • 35

Notes to Consolidated Financial Statements

short term securities that had an original term to maturity that exceeded 60 days. In instances when amortized cost is utilized, the Valuation Committee (the “Committee”) must reasonably conclude that the utilization of amortized cost is approximately the same as the fair value of the security. Such factors the Committee will consider include, but are not limited to, an impairment of the creditworthiness of the issuer or material changes in interest rates. Fixed-income securities, including mortgage-backed and asset-backed securities, may be valued on the basis of prices provided by a pricing service or at a price obtained from one or more of the major broker-dealers. In cases where broker-dealer quotes are obtained, the Adviser may establish procedures whereby changes in market yields or spreads are used to adjust, on a daily basis, a recently obtained quoted price on a security. Swaps and other derivatives are valued daily, primarily using independent pricing services, independent pricing models using market inputs, as well as third party broker-dealers or counterparties. Investment companies are valued at their net asset value each day.

Securities for which market quotations are not readily available (including restricted securities) or are deemed unreliable are valued at fair value. Factors considered in making this determination may include, but are not limited to, information obtained by contacting the issuer, analysts, analysis of the issuer’s financial statements or other available documents. In addition, the Portfolio may use fair value pricing for securities primarily traded in non-U.S. markets because most foreign markets close well before the Portfolio values its securities at 4:00 p.m., Eastern Time. The earlier close of these foreign markets gives rise to the possibility that significant events, including broad market moves, may have occurred in the interim and may materially affect the value of those securities.

2. Fair Value Measurements

In accordance with U.S. GAAP regarding fair value measurements, fair value is defined as the price that the Portfolio would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP establishes a framework for measuring fair value, and a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability (including those valued based on their market values as described in Note A.1 above). Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Portfolio. Unobservable inputs reflect the Portfolio’s own assumptions about the assumptions that market participants would use in pricing the asset or liability based on the best information available in the circumstances. Each investment is assigned a level based upon the observability of the inputs which are significant to the overall valuation. The three-tier hierarchy of inputs is summarized below.

• Level 1—quoted prices in active markets for identical investments

36 •  AB ALL MARKET REAL RETURN PORTFOLIO

Notes to Consolidated Financial Statements

• Level 2—other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

• Level 3—significant unobservable inputs (including the Portfolio’s own assumptions in determining the fair value of investments)

The fair value of debt instruments, such as bonds, and over-the-counter derivatives is generally based on market price quotations, recently executed market transactions (where observable) or industry recognized modeling techniques and are generally classified as Level 2. Pricing vendor inputs to Level 2 valuations may include quoted prices for similar investments in active markets, interest rates, coupon rates, yield curves, option adjusted spreads, default rates, credit spreads and other unique security features in order to estimate the relevant cash flows which is then discounted to calculate fair values. If these inputs are unobservable and significant to the fair value, these investments will be classified as Level 3. In addition, non-agency rated investments are classified as Level 3.

Other fixed income investments, including non-U.S. government and corporate debt, are generally valued using quoted market prices, if available, which are typically impacted by current interest rates, maturity dates and any perceived credit risk of the issuer. Additionally, in the absence of quoted market prices, these inputs are used by pricing vendors to derive a valuation based upon industry or proprietary models which incorporate issuer specific data with relevant yield/spread comparisons with more widely quoted bonds with similar key characteristics. Those investments for which there are observable inputs are classified as Level 2. Where the inputs are not observable, the investments are classified as Level 3.

Where readily available market prices or relevant bid prices are not available for certain equity investments, such investments may be valued based on similar publicly traded investments, movements in relevant indices since last available prices or based upon underlying company fundamentals and comparable company data (such as multiples to earnings or other multiples to equity). Where an investment is valued using an observable input, by pricing vendors, such as another publicly traded security, the investment will be classified as Level 2. If management determines that an adjustment is appropriate based on restrictions on resale, illiquidity or uncertainty, and such adjustment is a significant component of the valuation, the investment will be classified as Level 3. An investment will also be classified as Level 3 where management uses company fundamentals and other significant inputs to determine the valuation.

AB ALL MARKET REAL RETURN PORTFOLIO  • 37

Notes to Consolidated Financial Statements

The following table summarizes the valuation of the Portfolio’s investments by the above fair value hierarchy levels as of October 31, 2015:

Investments in Securities:	Level 1			Level 2			Level 3			Total
Assets:
Common Stocks:
Energy	$	79,848,653		$	50,100,765		$	– 0	–	$	129,949,418
Equity: Other		12,997,318			32,344,499			147,589			45,489,406
Retail		11,764,253			14,794,666			– 0	–		26,558,919
Materials		10,857,981			15,454,330			– 0	–^		26,312,311
Residential		12,067,850			11,605,386			– 0	–^^		23,673,236
Office		5,273,376			7,529,068			– 0	–		12,802,444
Oil, Gas & Consumable Fuels		– 0	–		9,979,610			– 0	–		9,979,610
Industrials		3,828,844			4,470,825			– 0	–		8,299,669
Lodging		5,158,220			232,676			– 0	–		5,390,896
Metals & Mining		– 0	–		4,710,509			– 0	–		4,710,509
Chemicals		4,542,440			– 0	–		– 0	–		4,542,440
Food Products		1,989,361			– 0	–		– 0	–		1,989,361
Real Estate		1,482,103			276,812			– 0	–		1,758,915
Mortgage		1,178,651			– 0	–		– 0	–		1,178,651
Food Beverage & Tobacco		872,308			– 0	–		– 0	–		872,308
Financial:Other		388,005			– 0	–		– 0	–		388,005
Inflation-Linked Securities		– 0	–		137,402,332			– 0	–		137,402,332
Investment Companies		29,994,166			– 0	–		– 0	–		29,994,166
Warrants		945			1,298,434			– 0	–		1,299,379
Short-Term Investments		49,719,017			– 0	–		– 0	–		49,719,017
Total Investments in Securities		231,963,491			290,199,912			147,589			522,310,992
Other Financial Instruments*:
Assets:
Futures		855,060			– 0	–		– 0	–		855,060	#
Forward Currency Exchange Contracts		– 0	–		1,052,368			– 0	–		1,052,368
Total Return Swaps		– 0	–		50,254			– 0	–		50,254
Liabilities:
Futures		(15,919,119	)		– 0	–		– 0	–		(15,919,119	)#
Forward Currency Exchange Contracts		– 0	–		(2,497,413	)		– 0	–		(2,497,413	)
Inflation (CPI) Swaps		– 0	–		(2,551,720	)		– 0	–		(2,551,720	)
Total Return Swaps		– 0	–		(4,644,954	)		– 0	–		(4,644,954	)
Total+	$	216,899,432		$	281,608,447		$	147,589		$	498,655,468

^ The Portfolio held securities with zero market value at period end.

^^ Amount less than $0.50.

* Other financial instruments are derivative instruments, such as futures, forwards and swaps, which are valued at the unrealized appreciation/depreciation on the instrument.

# Only variation margin receivable/payable at period end is reported within the consolidated statement of assets and liabilities. This amount reflects cumulative appreciation/(depreciation) of exchange-traded derivatives as reported in the consolidated portfolio of investments.

+ There were de minimus transfers under 1% of net assets between Level 1 and Level 2 during the reporting period.

38 •  AB ALL MARKET REAL RETURN PORTFOLIO

Notes to Consolidated Financial Statements

The Portfolio recognizes all transfers between levels of the fair value hierarchy assuming the financial instruments were transferred at the beginning of the reporting period.

The following is a reconciliation of investments in which significant unobservable inputs (Level 3) were used in determining fair value.

	Common Stocks - Equity: Other			Common Stocks  - Materials^			Common Stocks - Residential
Balance as of 10/31/14	$	– 0	–	$	2		$	2,586
Accrued discounts/(premiums)		– 0	–		– 0	–		– 0	–
Realized gain (loss)		– 0	–		– 0	–		– 0	–
Change in unrealized appreciation/depreciation		(150,535	)		(2	)		(181	)
Purchases		– 0	–		– 0	–		– 0	–
Sales		– 0	–		– 0	–		– 0	–
Transfers in to Level 3		298,124			– 0	–		– 0	–
Transfers out of Level 3		– 0	–		– 0	–		(2,405	)
Balance as of 10/31/15	$	147,589		$	– 0	–	$	– 0	–^^
Net change in unrealized appreciation/depreciation from investments held as of 10/31/15*	$	(150,535	)	$	– 0	–	$	– 0	–^^
	Total
Balance as of 10/31/14	$	2,588
Accrued discounts/(premiums)		– 0	–
Realized gain (loss)		– 0	–
Change in unrealized appreciation/depreciation		(150,718	)
Purchases		– 0	–
Sales		– 0	–
Transfers in to Level 3		298,124
Transfers out of Level 3		(2,405	)
Balance as of 10/31/15	$	147,589	+
Net change in unrealized appreciation/depreciation from investments held as of 10/31/15*	$	(150,535	)

^ The Portfolio held securities with zero market value at period end.

^^ Amount less than $0.50.

+ There were de minimis transfers under 1% of net assets during the reporting period.

* The unrealized appreciation/depreciation is included in net change in unrealized appreciation/depreciation on investments and other financial instruments in the accompanying statement of operations.

The Adviser established the Committee to oversee the pricing and valuation of all securities held in the Portfolio. The Committee operates under pricing and

AB ALL MARKET REAL RETURN PORTFOLIO  • 39

Notes to Consolidated Financial Statements

valuation policies and procedures established by the Adviser and approved by the Board, including pricing policies which set forth the mechanisms and processes to be employed on a daily basis to implement these policies and procedures. In particular, the pricing policies describe how to determine market quotations for securities and other instruments. The Committee’s responsibilities include: 1) fair value and liquidity determinations (and oversight of any third parties to whom any responsibility for fair value and liquidity determinations is delegated), and 2) regular monitoring of the Adviser’s pricing and valuation policies and procedures and modification or enhancement of these policies and procedures (or recommendation of the modification of these policies and procedures) as the Committee believes appropriate.

The Committee is also responsible for monitoring the implementation of the pricing policies by the Adviser’s Pricing Group (the “Pricing Group”) and a third party which performs certain pricing functions in accordance with the pricing policies. The Pricing Group is responsible for the oversight of the third party on a day-to-day basis. The Committee and the Pricing Group perform a series of activities to provide reasonable assurance of the accuracy of prices including: 1) periodic vendor due diligence meetings, review of methodologies, new developments and processes at vendors, 2) daily comparison of security valuation versus prior day for all securities that exceeded established thresholds, and 3) daily review of unpriced, stale, and variance reports with exceptions reviewed by senior management and the Committee.

In addition, several processes outside of the pricing process are used to monitor valuation issues including: 1) performance and performance attribution reports are monitored for anomalous impacts based upon benchmark performance, and 2) portfolio managers review all portfolios for performance and analytics (which are generated using the Adviser’s prices).

3. Currency Translation

Assets and liabilities denominated in foreign currencies and commitments under forward currency exchange contracts are translated into U.S. dollars at the mean of the quoted bid and ask prices of such currencies against the U.S. dollar. Purchases and sales of portfolio securities are translated into U.S. dollars at the rates of exchange prevailing when such securities were acquired or sold. Income and expenses are translated into U.S. dollars at rates of exchange prevailing when accrued.

Net realized gain or loss on foreign currency transactions represents foreign exchange gains and losses from sales and maturities of foreign fixed income investments, foreign currency exchange contracts, holding of foreign currencies, currency gains or losses realized between the trade and settlement dates on foreign investment transactions, and the difference between the amounts of dividends, interest and foreign withholding taxes recorded on the Portfolio’s books

40 •  AB ALL MARKET REAL RETURN PORTFOLIO

Notes to Consolidated Financial Statements

and the U.S. dollar equivalent amounts actually received or paid. Net unrealized currency gains and losses from valuing foreign currency denominated assets and liabilities at period end exchange rates are reflected as a component of net unrealized appreciation or depreciation of foreign currency denominated assets and liabilities.

4. Taxes

It is the Portfolio’s policy to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its investment company taxable income and net realized gains, if any, to shareholders. Therefore, no provisions for federal income or excise taxes are required. The Portfolio may be subject to taxes imposed by countries in which it invests. Such taxes are generally based on income and/or capital gains earned or repatriated. Taxes are accrued and applied to net investment income, net realized gains and net unrealized appreciation/depreciation as such income and/or gains are earned.

If, during a taxable year, the Subsidiary’s taxable losses (and other deductible items) exceed its income and gains, the net loss will not pass through to the Portfolio as a deductible amount for Federal income tax purposes. Note that the loss from the Subsidiary’s contemplated activities also cannot be carried forward to reduce future Subsidiary’s income in subsequent years. However, if the Subsidiary’s taxable gains exceed its losses and other deductible items during a taxable year, the net gain will pass through to the Portfolio as income for Federal income tax purposes.

In accordance with U.S. GAAP requirements regarding accounting for uncertainties in income taxes, management has analyzed the Portfolio’s tax positions taken or expected to be taken on federal and state income tax returns for all open tax years (the current and the prior three tax years) and has concluded that no provision for income tax is required in the Portfolio’s consolidated financial statements.

5. Investment Income and Investment Transactions

Dividend income is recorded on the ex-dividend date or as soon as the Portfolio is informed of the dividend. Interest income is accrued daily. Investment transactions are accounted for on the date the securities are purchased or sold. Investment gains or losses are determined on the identified cost basis. The Portfolio amortizes premiums and accretes discounts as adjustments to interest income.

6. Class Allocations

All income earned and expenses incurred by the Portfolio are borne on a pro-rata basis by each outstanding class of shares, based on the proportionate interest in the Portfolio represented by the net assets of such class, except for class specific expenses which are allocated to the respective class. Expenses of the

AB ALL MARKET REAL RETURN PORTFOLIO  • 41

Notes to Consolidated Financial Statements

Fund are charged proportionately to each Portfolio or based on other appropriate methods. Realized and unrealized gains and losses are allocated among the various share classes based on respective net assets.

7. Dividends and Distributions

Dividends and distributions to shareholders, if any, are recorded on the ex-dividend date. Income dividends and capital gains distributions are determined in accordance with federal tax regulations and may differ from those determined in accordance with U.S. GAAP. To the extent these differences are permanent, such amounts are reclassified within the capital accounts based on their federal tax basis treatment; temporary differences do not require such reclassification.

NOTE B

Management Fee and Other Transactions with Affiliates

Under the terms of the investment advisory agreement, the Portfolio pays the Adviser a management fee at an annual rate of .75% of the Portfolio’s average daily net assets. Effective February 1, 2014, the Adviser agreed to waive its fees and bear certain expenses to the extent necessary to limit total operating expenses on an annual basis to 1.30%, 2.00%, 1.00%, 1.50%, 1.25%, 1.00%, 1.25%, 1.00% and 1.00% of daily average net assets for Class A, Class C, Advisor Class, Class R, Class K, Class I, Class 1, Class 2 and Class Z shares, respectively. This fee waiver and/or expense reimbursement agreement will remain in effect until January 29, 2016. For the year ended October 31, 2015, such reimbursement amounted to $114,288. Prior to February 1, 2014, the Adviser had agreed to waive its fees and bear certain expenses to the extent necessary to limit total operating expenses on an annual basis to 1.05%, 1.75%, 0.75%, 1.25%, 1.00%, 0.75%, 1.00% and 0.75% of daily average net assets for Class A, Class C, Advisor Class, Class R, Class K, Class I, Class 1 and Class 2 shares, respectively.

The Subsidiary has entered into a separate agreement with the Adviser for the management of the Subsidiary’s portfolio. The Adviser receives no compensation from the Subsidiary for its services under the agreement.

During the years ended October 31, 2015 and October 31, 2014 the Adviser reimbursed the Strategy $306 and $119,942, respectively, for trading losses incurred due to a trade entry error.

Pursuant to the investment advisory agreement, the Portfolio may reimburse the Adviser for certain legal and accounting services provided to the Portfolio by the Adviser. For the year ended October 31, 2015, the reimbursement for such services amounted to $49,900.

The Portfolio compensates AllianceBernstein Investor Services, Inc. (“ABIS”), a wholly-owned subsidiary of the Adviser, under a Transfer Agency Agreement for providing personnel and facilities to perform transfer agency services for the Portfolio. ABIS may make payments to intermediaries that provide omnibus

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Notes to Consolidated Financial Statements

account services, sub-accounting services and/or networking services. Such compensation retained by ABIS amounted to $110,359 for the year ended October 31, 2015.

AllianceBernstein Investments, Inc. (the “Distributor”), a wholly-owned subsidiary of the Adviser, serves as the distributor of the Portfolio’s shares. The Distributor has advised the Portfolio that it has retained front-end sales charges of $1,109 from the sale of Class A shares and received $8 and $818 in contingent deferred sales charges imposed upon redemptions by shareholders of Class A and Class C shares, respectively, for the year ended October 31, 2015.

The Portfolio may invest in the AB Fixed-Income Shares, Inc.—Government STIF Portfolio (“Government STIF Portfolio”), an open-end management investment company managed by the Adviser. The Government STIF Portfolio is offered as a cash management option to mutual funds and other institutional accounts of the Adviser, and is not available for direct purchase by members of the public. The Government STIF Portfolio pays no investment management fees but does bear its own expenses. A summary of the Portfolio’s transactions in shares of the Government STIF Portfolio for the year ended October 31, 2015 is as follows:

Market Value October 31, 2014 (000)		Purchases at Cost (000)		Sales Proceeds (000)		Market Value October 31, 2015 (000)		Dividend Income (000)
$	111,862	$	346,108	$	408,251	$	49,719	$	74

Brokerage commissions paid on investment transactions for the year ended October 31, 2015 amounted to $465,209, of which $0 and $0, respectively, was paid to Sanford C. Bernstein & Co. LLC and Sanford C. Bernstein Limited, affiliates of the Adviser.

NOTE C

Distribution Services Agreement

The Portfolio has adopted a Distribution Services Agreement (the “Agreement”) pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the Agreement, the Portfolio pays distribution and servicing fees to AllianceBernstein Investments, Inc. (the “Distributor”) at an annual rate of up to .30% of the Portfolio’s average daily net assets attributable to Class A shares, 1% of the Portfolio’s average daily net assets attributable to Class C shares, .50% of the Portfolio’s average daily net assets attributable to Class R shares, .25% of the Portfolio’s average daily net assets attributable to Class K shares and .25% of the Portfolio’s average daily net assets attributable to Class 1 shares. There are no distribution and servicing fees on the Advisor Class, Class I, Class 2 and Class Z shares. The fees are accrued daily and paid monthly. The Agreement provides that the Distributor will use such payments in their entirety for distribution assistance and promotional activities. Since the commencement of the

AB ALL MARKET REAL RETURN PORTFOLIO  • 43

Notes to Consolidated Financial Statements

Portfolio’s operations, the Distributor has incurred expenses in excess of the distribution costs reimbursed by the Portfolio in the amounts of $145,679, $14,160, $20,431 and $2,305,314 for Class C, Class R, Class K and Class 1 shares, respectively. While such costs may be recovered from the Portfolio in future periods so long as the Agreement is in effect, the rate of the distribution and servicing fees payable under the Agreement may not be increased without a shareholder vote. In accordance with the Agreement, there is no provision for recovery of unreimbursed distribution costs incurred by the Distributor beyond the current fiscal year for Class A shares. The Agreement also provides that the Adviser may use its own resources to finance the distribution of the Portfolio’s shares.

NOTE D

Investment Transactions

Purchases and sales of investment securities (excluding short-term investments) for the year ended October 31, 2015 were as follows:

	Purchases		Sales
Investment securities (excluding U.S. government securities)	$	313,935,468	$	258,511,030
U.S. government securities		20,848,883		– 0	–

The cost of investments for federal income tax purposes, gross unrealized appreciation and unrealized depreciation (excluding futures, foreign currency, written options and swap transactions) are as follows:

Cost	$	691,242,574
Gross unrealized appreciation	$	376,090
Gross unrealized depreciation		(168,549,153	)
Net unrealized depreciation	$	(168,173,063	)

1. Derivative Financial Instruments

The Portfolio may use derivatives in an effort to earn income and enhance returns, to replace more traditional direct investments, to obtain exposure to otherwise inaccessible markets (collectively, “investment purposes”), or to hedge or adjust the risk profile of its portfolio.

The principal types of derivatives utilized by the Portfolio, as well as the methods in which they may be used are:

• Futures

The Portfolio may buy or sell futures for investment purposes or for the purpose of hedging its portfolio against adverse effects of potential movements in the market. The Portfolio bears the market risk that arises from changes in the value of these instruments and the imperfect correlation between movements in the price of the futures and movements

44 •  AB ALL MARKET REAL RETURN PORTFOLIO

Notes to Consolidated Financial Statements

in the price of the assets, reference rates or indices which they are designed to track. Among other things, the Portfolio may purchase or sell futures for foreign currencies or options thereon for non-hedging purposes as a means of making direct investment in foreign currencies, as described below under “Currency Transactions”.

At the time the Portfolio enters into futures, the Portfolio deposits and maintains as collateral an initial margin with the broker, as required by the exchange on which the transaction is effected. Such amount is shown as cash collateral due from broker on the consolidated statement of assets and liabilities. Pursuant to the contract, the Portfolio agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments are known as variation margin and are recorded by the Portfolio as unrealized gains or losses. Risks may arise from the potential inability of a counterparty to meet the terms of the contract. The credit/counterparty risk for exchange-traded futures is generally less than privately negotiated futures, since the clearinghouse, which is the issuer or counterparty to each exchange-traded future, has robust risk mitigation standards, including the requirement to provide initial and variation margin. When the contract is closed, the Portfolio records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the time it was closed.

Use of long futures subjects the Portfolio to risk of loss in excess of the amounts shown on the consolidated statement of assets and liabilities, up to the notional value of the futures. Use of short futures subjects the Portfolio to unlimited risk of loss. Under some circumstances, futures exchanges may establish daily limits on the amount that the price of futures can vary from the previous day’s settlement price, which could effectively prevent liquidation of unfavorable positions.

During the year ended October 31, 2015, the Portfolio held futures for hedging and non-hedging purposes.

• Forward Currency Exchange Contracts

The Portfolio may enter into forward currency exchange contracts in order to hedge its exposure to changes in foreign currency exchange rates on its foreign portfolio holdings, to hedge certain firm purchase and sale commitments denominated in foreign currencies and for non-hedging purposes as a means of making direct investments in foreign currencies, as described below under “Currency Transactions”.

A forward currency exchange contract is a commitment to purchase or sell a foreign currency at a future date at a negotiated forward rate. The gain or loss arising from the difference between the original contract and the closing of such contract would be included in net realized gain or loss on foreign currency transactions. Fluctuations in the value of open forward

AB ALL MARKET REAL RETURN PORTFOLIO  • 45

Notes to Consolidated Financial Statements

currency exchange contracts are recorded for financial reporting purposes as unrealized appreciation and/or depreciation by the Portfolio. Risks may arise from the potential inability of a counterparty to meet the terms of a contract and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar.

During the year ended October 31, 2015, the Portfolio held forward currency exchange contracts for hedging and non-hedging purposes.

• Option Transactions

For hedging and investment purposes, the Portfolio may purchase and write (sell) put and call options on U.S. and foreign securities, including government securities, and foreign currencies that are traded on U.S. and foreign securities exchanges and over-the-counter markets. Among other things, the Portfolio may use options transactions for non-hedging purposes as a means of making direct investments in foreign currencies, as described below under “Currency Transactions” and may use options strategies involving the purchase and/or writing of various combinations of call and/or put options, for hedging and investment purposes.

The risk associated with purchasing an option is that the Portfolio pays a premium whether or not the option is exercised. Additionally, the Portfolio bears the risk of loss of the premium and change in market value should the counterparty not perform under the contract. Put and call options purchased are accounted for in the same manner as portfolio securities. The cost of securities acquired through the exercise of call options is increased by premiums paid. The proceeds from securities sold through the exercise of put options are decreased by the premiums paid.

When the Portfolio writes an option, the premium received by the Portfolio is recorded as a liability and is subsequently adjusted to the current market value of the option written. Premiums received from written options which expire unexercised are recorded by the Portfolio on the expiration date as realized gains from options written. The difference between the premium received and the amount paid on effecting a closing purchase transaction, including brokerage commissions, is also treated as a realized gain, or if the premium received is less than the amount paid for the closing purchase transaction, as a realized loss. If a call option is exercised, the premium received is added to the proceeds from the sale of the underlying security or currency in determining whether the Portfolio has realized a gain or loss. If a put option is exercised, the premium received reduces the cost basis of the security or currency purchased by the Portfolio. In writing an option, the Portfolio bears the market risk of an unfavorable change in the price of the security or currency underlying the written option. Exercise of an option written by the Portfolio could result in the Portfolio selling or buying a security or currency at a price different from the current market value.

46 •  AB ALL MARKET REAL RETURN PORTFOLIO

Notes to Consolidated Financial Statements

During the year ended October 31, 2015, the Portfolio held purchased options for hedging and non-hedging purposes.

During the year ended October 31, 2015, the Portfolio held written options for hedging and non-hedging purposes.

For the year ended October 31, 2015, the Portfolio had the following transactions in written options:

	Number of Contracts			Premiums Received
Options written outstanding as of 10/31/14		– 0	–	$	– 0	–
Options written		18,977,914			5,863,774
Options expired		(6,502,284	)		(2,129,588	)
Options bought back		(12,475,630	)		(3,734,186	)
Options exercised		– 0	–		– 0	–
Options written outstanding as of 10/31/15		– 0	–	$	– 0	–

• Swaps

The Portfolio may enter into swaps to hedge its exposure to interest rates, credit risk, equity markets and currencies. The Portfolio may also enter into swaps for non-hedging purposes as a means of gaining market exposures, making direct investments in foreign currencies, as described below under “Currency Transactions” or in order to take a “long” or “short” position with respect to an underlying referenced asset described below under “Total Return Swaps”. A swap is an agreement that obligates two parties to exchange a series of cash flows at specified intervals based upon or calculated by reference to changes in specified prices or rates for a specified amount of an underlying asset. The payment flows are usually netted against each other, with the difference being paid by one party to the other. In addition, collateral may be pledged or received by the Portfolio in accordance with the terms of the respective swaps to provide value and recourse to the Portfolio or its counterparties in the event of default, bankruptcy or insolvency by one of the parties to the swap.

Risks may arise as a result of the failure of the counterparty to the swap to comply with the terms of the swap. The loss incurred by the failure of a counterparty is generally limited to the net interim payment to be received by the Portfolio, and/or the termination value at the end of the contract. Therefore, the Portfolio considers the creditworthiness of each counterparty to a swap in evaluating potential counterparty risk. This risk is mitigated by having a netting arrangement between the Portfolio and the counterparty and by the posting of collateral by the counterparty to the Portfolio to cover the Portfolio’s exposure to the counterparty. Additionally, risks may arise from unanticipated movements in interest rates or in the value of the underlying securities. The Portfolio accrues for the interim payments on swaps on a daily basis, with the net amount recorded within unrealized appreciation/depreciation of swaps on the consolidated statement of assets

AB ALL MARKET REAL RETURN PORTFOLIO  • 47

Notes to Consolidated Financial Statements

and liabilities, where applicable. Once the interim payments are settled in cash, the net amount is recorded as realized gain/(loss) on swaps on the consolidated statement of operations, in addition to any realized gain/(loss) recorded upon the termination of swaps. Upfront premiums paid or received are recognized as cost or proceeds on the consolidated statement of assets and liabilities and are amortized on a straight line basis over the life of the contract. Amortized upfront premiums are included in net realized gain/(loss) from swaps on the consolidated statement of operations. Fluctuations in the value of swaps are recorded as a component of net change in unrealized appreciation/depreciation of swaps on the consolidated statement of operations.

Interest Rate Swaps:

The Portfolio is subject to interest rate risk exposure in the normal course of pursuing its investment objectives. Because the Portfolio holds fixed rate bonds, the value of these bonds may decrease if interest rates rise. To help hedge against this risk and to maintain its ability to generate income at prevailing market rates, the Portfolio may enter into interest rate swaps. Interest rate swaps are agreements between two parties to exchange cash flows based on a notional amount. The Portfolio may elect to pay a fixed rate and receive a floating rate, or, receive a fixed rate and pay a floating rate on a notional amount.

In addition, a Portfolio may also enter into interest rate swap transactions to preserve a return or spread on a particular investment or portion of its portfolio, or protecting against an increase in the price of securities the Portfolio anticipates purchasing at a later date. Interest rate swaps involve the exchange by a Portfolio with another party of their respective commitments to pay or receive interest (e.g., an exchange of floating rate payments for fixed rate payments) computed based on a contractually-based principal (or “notional”) amount. Interest rate swaps are entered into on a net basis (i.e., the two payment streams are netted out, with the Portfolio receiving or paying, as the case may be, only the net amount of the two payments).

During the year ended October 31, 2015, the Portfolio held interest rate swaps for hedging and non-hedging purposes.

Inflation (CPI) Swaps:

Inflation swap agreements are contracts in which one party agrees to pay the cumulative percentage increase in a price index (the Consumer Price Index with respect to CPI swaps) over the term of the swap (with some lag on the inflation index), and the other pays a compounded fixed rate. Inflation swaps may be used to protect the net asset value, or NAV, of Portfolio against an unexpected change in the rate of inflation measured by an inflation index since the value of these agreements is expected to increase if unexpected inflation increases.

48 •  AB ALL MARKET REAL RETURN PORTFOLIO

Notes to Consolidated Financial Statements

During the year ended October 31, 2015, the Portfolio held inflation (CPI) swaps for hedging and non-hedging purposes.

Total Return Swaps:

The Portfolio may enter into total return swaps in order to take a “long” or “short” position with respect to an underlying referenced asset. The Portfolio is subject to market price volatility of the underlying referenced asset. A total return swap involves commitments to pay interest in exchange for a market linked return based on a notional amount. To the extent that the total return of the security, group of securities or index underlying the transaction exceeds or falls short of the offsetting interest obligation, the Portfolio will receive a payment from or make a payment to the counterparty.

During the year ended October 31, 2015, the Portfolio held total return swaps for hedging and non-hedging purposes.

The Portfolio typically enters into International Swaps and Derivatives Association, Inc. Master Agreements (“ISDA Master Agreement”) or similar master agreements (collectively, “Master Agreements”) with its derivative contract counterparties in order to, among other things, reduce its credit risk to counterparties. ISDA Master Agreements include provisions for general obligations, representations, collateral and events of default or termination. Under an ISDA Master Agreement, the Portfolio typically may offset with the counterparty certain derivative financial instrument’s payables and/or receivables with collateral held and/or posted and create one single net payment (close-out netting) in the event of default or termination.

Various Master Agreements govern the terms of certain transactions with counterparties, including transactions such as derivative transactions, repurchase and reverse repurchase agreements. These Master Agreements typically attempt to reduce the counterparty risk associated with such transactions by specifying credit protection mechanisms and providing standardization that improves legal certainty. Cross-termination provisions under Master Agreements typically provide that a default in connection with one transaction between the Portfolio and a counterparty gives the non-defaulting party the right to terminate any other transactions in place with the defaulting party to create one single net payment due to/due from the defaulting party. In the event of a default by a Master Agreements counterparty, the return of collateral with market value in excess of the Portfolio’s net liability, held by the defaulting party, may be delayed or denied.

The Portfolio’s Master Agreements may contain provisions for early termination of OTC derivative transactions in the event the net assets of the Portfolio decline below specific levels (“net asset contingent features”). If these levels are triggered, the Portfolio’s counterparty has the right to terminate such transaction and require the Portfolio to pay or receive a settlement amount in connection with the terminated transaction. For additional details, please refer to netting arrangements by counterparty tables below.

AB ALL MARKET REAL RETURN PORTFOLIO  • 49

Notes to Consolidated Financial Statements

At October 31, 2015, the Portfolio had entered into the following derivatives:

	Asset Derivatives				Liability Derivatives
Derivative Type	Consolidated Statement of Assets and Liabilities Location	Fair Value			Consolidated Statement of Assets and Liabilities Location	Fair Value
Commodity contracts	Receivable/Payable for variation margin on exchange-traded derivatives	$	855,060	*	Receivable/Payable for variation margin on exchange-traded derivatives	$	15,919,119	*
Foreign exchange contracts	Unrealized appreciation on forward currency exchange contracts		1,052,368		Unrealized depreciation on forward currency exchange contracts		2,497,413
Interest rate contracts					Unrealized depreciation on inflation swaps		2,551,720
Equity contracts	Unrealized appreciation on total return swaps		50,254		Unrealized depreciation on total return swaps		4,644,954
Total		$	1,957,682			$	25,613,206

* Only variation margin receivable/payable at period end is reported within the consolidated statement of assets and liabilities. This amount reflects cumulative appreciation/(depreciation) of exchange-traded derivatives as reported in the consolidated portfolio of investments.

The effect of derivative instruments on the consolidated statement of operations for the year ended October 31, 2015:

Derivative Type	Location of Gain or (Loss) on Derivatives	Realized Gain or (Loss) on Derivatives			Change in Unrealized Appreciation or (Depreciation)
Equity contracts	Net realized gain (loss) on futures; Net change in unrealized appreciation/depreciation of futures	$	(2,410,382	)	$	711,386
Commodity contracts	Net realized gain (loss) on futures; Net change in unrealized appreciation/depreciation of futures		(5,260,725	)		(11,782,800	)
Foreign exchange contracts	Net realized gain (loss) on foreign currency transactions; Net change in unrealized appreciation/depreciation of foreign currency denominated assets and liabilities		7,670,898			(4,206,089	)

50 •  AB ALL MARKET REAL RETURN PORTFOLIO

Notes to Consolidated Financial Statements

Derivative Type	Location of Gain or (Loss) on Derivatives	Realized Gain or (Loss) on Derivatives			Change in Unrealized Appreciation or (Depreciation)
Equity contracts	Net realized gain (loss) on investment transactions; Net change in unrealized appreciation/depreciation of investments	$	2,639,663		$	836,383
Equity contracts	Net realized gain (loss) on options written; Net change in unrealized appreciation/depreciation of options written		(2,757,379	)		– 0	–
Commodity contracts	Net realized gain (loss) on options written; Net change in unrealized appreciation/depreciation of options written		(226,277	)		– 0	–
Interest rate contracts	Net realized gain (loss) on swaps; Net change in unrealized appreciation/depreciation of swaps		(13,075,847	)		2,155,641
Equity contracts	Net realized gain (loss) on swaps; Net change in unrealized appreciation/depreciation of swaps		(48,231,231	)		(5,870,709	)
Total		$	(61,651,280	)	$	(18,156,188	)

The following table represents the average monthly volume of the Portfolio’s derivative transactions during the year ended October 31, 2015:

Futures:
Average original value of buy contracts	$	85,040,117
Average original value of sale contracts	$	38,808,477
Forward Currency Exchange Contracts:
Average principal amount of buy contracts	$	53,184,015
Average principal amount of sale contracts	$	121,059,674
Purchased Options:
Average monthly cost	$	1,920,887	(a)
Interest Rate Swaps:
Average notional amount	$	3,830,000	(b)
Inflation Swaps:
Average notional amount	$	336,073,077
Total Return Swaps:
Average notional amount	$	198,447,297

^(a)  Positions were open for three months during the year.

^(b)  Positions were open for nine months during the year.

For financial reporting purposes, the Portfolio does not offset derivative assets and derivative liabilities that are subject to netting arrangements in the consolidated statement of assets and liabilities.

AB ALL MARKET REAL RETURN PORTFOLIO  • 51

Notes to Consolidated Financial Statements

All derivatives held at period end were subject to netting arrangements. The following table presents the Portfolio’s derivative assets and liabilities by counterparty net of amounts available for offset under Master Agreements (“MA”) and net of the related collateral received/ pledged by the Portfolio as of October 31, 2015:

AB All Market Real Return

Counterparty

Derivative Assets Subject to a MA

Derivative Available for Offset

Cash Collateral Received

Security Collateral Received

Net Amount of Derivatives Assets

OTC Derivatives:

Citibank

$

65,270

$

(65,270

)

$

– 0

–

$

– 0

–

$

– 0

–

Deutsche Bank AG

86,620

(86,620

)

– 0

–

– 0

–

– 0

–

JPMorgan Chase Bank/ JPMorgan Chase Bank, NA

19,258

(19,258

)

– 0

–

– 0

–

– 0

–

Morgan Stanley & Co., Inc.

166,455

(33,206

)

– 0

–

– 0

–

133,249

Northern Trust Company

76,892

– 0

–

– 0

–

– 0

–

76,892

Royal Bank of Scotland PLC

312,901

(312,901

)

– 0

–

– 0

–

– 0

–

Standard Chartered Bank

77,876

– 0

–

– 0

–

– 0

–

77,876

State Street Bank & Trust Co.

72,467

(25,948

)

– 0

–

– 0

–

46,519

Total

$

877,739

$

(543,203

)

$

– 0

–

$

– 0

–

$

334,536

^

Counterparty

Derivative Liabilities Subject to a MA

Derivative Available for Offset

Cash Collateral Pledged

Security Collateral Pledged*

Net Amount of Derivatives Liabilities

OTC Derivatives:

BNP Paribas SA

$

50,966

$

– 0

–

$

– 0

–

$

– 0

–

$

50,966

Citibank

329,914

(65,270

)

– 0

–

– 0

–

264,644

Deutsche Bank AG

1,672,256

(86,620

)

– 0

–

(1,585,636

)

– 0

–

Goldman Sachs Bank USA

255,869

– 0

–

– 0

–

– 0

–

255,869

HSBC Bank USA

3,918

– 0

–

– 0

–

– 0

–

3,918

JPMorgan Chase Bank/ JPMorgan Chase Bank, NA

1,041,105

(19,258

)

– 0

–

(1,021,847

)

– 0

–

Morgan Stanley & Co., Inc.

33,206

(33,206

)

– 0

–

– 0

–

– 0

–

Royal Bank of Scotland PLC

1,287,370

(312,901

)

– 0

–

– 0

–

974,469

State Street Bank & Trust Co.

25,948

(25,948

)

– 0

–

– 0

–

– 0

–

UBS AG

277,681

– 0

–

– 0

–

– 0

–

277,681

Total

$

4,978,233

$

(543,203

)

$

– 0

–

$

(2,607,483

)

$

1,827,547

^

* The actual collateral received/pledged may be more than the amount reported due to overcollateralization.

^ Net amount represents the net receivable/payable that would be due from/to the counterparty in the event of default or termination. The net amount from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same counterparty.

52 •  AB ALL MARKET REAL RETURN PORTFOLIO

Notes to Consolidated Financial Statements

AllianceBernstein Cayman Inflation Strategy, Ltd.

Counterparty	Derivative Assets Subject to a MA		Derivative Available for Offset			Cash Collateral Received			Security Collateral Received			Net Amount of Derivatives Assets
Exchange-Traded Derivatives:
Morgan Stanley & Co., LLC**	$	113,358	$	– 0	–	$	– 0	–	$	– 0	–	$	113,358
Total	$	113,358	$	– 0	–	$	– 0	–	$	– 0	–	$	113,358
OTC Derivatives:
JPMorgan Chase Bank, NA	$	50,254	$	(50,254	)	$	– 0	–	$	– 0	–	$	– 0	–
Royal Bank of Scotland PLC		159,083		– 0	–		– 0	–		– 0	–		159,083
State Street Bank & Trust Co.		15,546		(15,546	)		– 0	–		– 0	–		– 0	–
Total	$	224,883	$	(65,800	)	$	– 0	–	$	– 0	–	$	159,083	^

Counterparty	Derivative Liabilities Subject to a MA		Derivative Available for Offset			Cash Collateral Pledged			Security Collateral Pledged*			Net Amount of Derivatives Liabilities
OTC Derivatives:
Credit Suisse International	$	1,128,647	$	– 0	–	$	– 0	–	$	(1,128,647	)	$	– 0	–
Deutsche Bank AG		15,538		– 0	–		– 0	–		– 0	–		15,538
Goldman Sachs International		1,241,729		– 0	–		– 0	–		(1,241,729	)		– 0	–
JPMorgan Chase Bank		795		– 0	–		– 0	–		– 0	–		795
JPMorgan Chase Bank, NA		2,274,578		(50,254	)		– 0	–		(2,224,324	)		– 0	–
State Street Bank & Trust Co.		54,567		(15,546	)		– 0	–		– 0	–		39,021
Total	$	4,715,854	$	(65,800	)	$	– 0	–	$	(4,594,700	)	$	55,354	^

* The actual collateral received/pledged may be more than the amount reported due to overcollateralization.

** Cash has been posted for initial margin requirements for exchange traded derivatives outstanding at October 31, 2015.

^ Net amount represents the net receivable/payable that would be due from/to the counterparty in the event of default or termination. The net amount from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same counterparty.

2. Currency Transactions

The Portfolio may invest in non-U.S. dollar securities on a currency hedged or unhedged basis. The Portfolio may seek investment opportunities by taking long or short positions in currencies through the use of currency-related derivatives, including forward currency exchange contracts, futures and options on futures, swaps, and other options. The Portfolio may enter into transactions for investment

AB ALL MARKET REAL RETURN PORTFOLIO  • 53

Notes to Consolidated Financial Statements

opportunities when it anticipates that a foreign currency will appreciate or depreciate in value but securities denominated in that currency are not held by the Portfolio and do not present attractive investment opportunities. Such transactions may also be used when the Adviser believes that it may be more efficient than a direct investment in a foreign currency-denominated security. The Portfolio may also conduct currency exchange contracts on a spot basis (i.e., for cash at the spot rate prevailing in the currency exchange market for buying or selling currencies).

NOTE E

Capital Stock

Each class consists of 3,000,000,000 authorized shares. Transactions in capital shares for each class were as follows:

	Shares						Amount
	Year Ended October 31, 2015			Year Ended October 31, 2014			Year Ended October 31, 2015			Year Ended October 31, 2014
Class A
Shares sold		374,648			711,126		$	3,531,705		$	7,769,044
Shares issued in reinvestment of dividends		37,166			46,030			350,845			488,844
Shares redeemed		(1,070,575	)		(3,924,160	)		(10,041,550	)		(44,056,119	)
Net decrease		(658,761	)		(3,167,004	)	$	(6,159,000	)	$	(35,798,231	)
Class C
Shares sold		37,945			66,006		$	351,368		$	733,585
Shares issued in reinvestment of dividends		9,857			4,929			92,557			52,050
Shares redeemed		(344,737	)		(449,168	)		(3,093,893	)		(4,892,133	)
Net decrease		(296,935	)		(378,233	)	$	(2,649,968	)	$	(4,106,498	)
Advisor Class
Shares sold		1,189,217			3,229,636		$	10,830,265		$	36,855,186
Shares issued in reinvestment of dividends		98,208			65,150			925,118			692,544
Shares redeemed		(3,060,481	)		(3,621,284	)		(28,495,992	)		(39,903,399	)
Net decrease		(1,773,056	)		(326,498	)	$	(16,740,609	)	$	(2,355,669	)
Class R
Shares sold		7,416			16,124		$	63,929		$	168,739
Shares issued in reinvestment of dividends		442			28			4,154			296
Shares redeemed		(5,045	)		(2,285	)		(45,082	)		(24,289	)
Net increase		2,813			13,867		$	23,001		$	144,746

54 •  AB ALL MARKET REAL RETURN PORTFOLIO

Notes to Consolidated Financial Statements

	Shares						Amount
	Year Ended October 31, 2015			Year Ended October 31, 2014			Year Ended October 31, 2015			Year Ended October 31, 2014
Class K
Shares sold		62,469			101,455		$	557,586		$	1,094,794
Shares issued in reinvestment of dividends		5,336			2,522			50,051			26,710
Shares redeemed		(68,385	)		(49,545	)		(611,048	)		(530,428	)
Net increase (decrease)		(580	)		54,432		$	(3,411	)	$	591,076
Class I
Shares sold		150,454			453,087		$	1,362,834		$	4,971,354
Shares issued in reinvestment of dividends		48,155			33,483			452,178			354,918
Shares redeemed		(433,520	)		(205,125	)		(4,392,159	)		(2,347,148	)
Net increase (decrease)		(234,911	)		281,445		$	(2,577,147	)	$	2,979,124
Class 1
Shares sold		18,003,797			17,658,838		$	160,040,128		$	192,145,101
Shares issued in reinvestment of dividends		1,118,730			569,369			10,437,747			6,001,142
Shares redeemed		(9,227,855	)		(7,369,828	)		(81,519,998	)		(79,296,240	)
Net increase		9,894,672			10,858,379		$	88,957,877		$	118,850,003
Class Z*
Shares sold		563,425			(950	)	$	4,665,612		$	(10,003	)
Shares redeemed		(174,072	)		– 0	–		(1,445,720	)		– 0	–
Net increase (decrease)		389,353			(950	)	$	3,219,892		$	(10,003	)

* Commenced distribution on January 31, 2014.

NOTE F

Risks Involved in Investing in the Portfolio

Interest Rate Risk and Credit Risk—Interest rate risk is the risk that changes in interest rates will affect the value of the Portfolio’s investments in fixed-income debt securities such as bonds or notes. Increases in interest rates may cause the value of the Portfolio’s investments to decline. Credit risk is the risk that the issuer or guarantor of a debt security, or the counterparty to a derivative contract, will be unable or unwilling to make timely principal and/or interest payments, or to otherwise honor its obligations. The degree of risk for a particular security may be reflected in its credit rating. Credit risk is greater for medium quality and lower-rated securities. Lower-rated debt securities and similar unrated securities (commonly known as “junk bonds”) have speculative elements or are predominantly speculative risks.

AB ALL MARKET REAL RETURN PORTFOLIO  • 55

Notes to Consolidated Financial Statements

Commodity Risk—Investing in commodities and commodity-linked derivative instruments, either directly or through the Subsidiary, may subject the Portfolio to greater volatility than investments in traditional securities. The value of commodity-linked derivative instruments may be affected by changes in overall market movements, commodity index volatility, changes in interest rates, or factors affecting a particular industry or commodity, such as drought, floods, weather, livestock disease, embargoes, tariffs and international economic, political and regulatory developments.

Derivatives Risk—The Portfolio may enter into derivative transactions such as forwards, options, futures and swaps. Derivatives may be illiquid, difficult to price, and leveraged so that small changes may produce disproportionate losses for the Portfolio, and subject to counterparty risk to a greater degree than more traditional investments. Derivatives may result in significant losses, including losses that are far greater than the value of the derivatives reflected in the consolidated statement of assets and liabilities.

Leverage Risk—When the Portfolio borrows money or otherwise leverages its investments, its performance may be volatile because leverage tends to exaggerate the effect of any increase or decrease in the value of the Portfolio’s investments. The Portfolio may create leverage through the use of reverse repurchase arrangements, forward currency exchange contracts, forward commitments, dollar rolls or futures or by borrowing money. The use of derivative instruments by the Portfolio, such as forwards, futures, options and swaps, may also result in a form of leverage. Leverage may result in higher returns to the Portfolio than if the Portfolio were not leveraged, but may also adversely affect returns, particularly if the market is declining.

Liquidity Risk—Liquidity risk occurs when certain investments become difficult to purchase or sell. Difficulty in selling less liquid securities may result in sales at disadvantageous prices affecting the value of your investment in the Portfolio. Causes of liquidity risk may include low trading volumes, large positions and heavy redemptions of fixed-income mutual fund shares. Over recent years, liquidity risk has also increased because the capacity of dealers in the secondary market for fixed-income securities to make markets in these securities has decreased, even as the overall bond market has grown significantly, due to, among other things, structural changes, additional regulatory requirements and capital and risk restraints that have led to reduced inventories. Liquidity risk may be higher in a rising interest rate environment, when the value and liquidity of fixed-income securities generally go down.

Foreign (Non-U.S.) Risk—Investments in securities of non-U.S. issuers may involve more risk than those of U.S. issuers. These securities may fluctuate more widely in price and may be less liquid due to adverse market, economic, political, regulatory or other factors.

56 •  AB ALL MARKET REAL RETURN PORTFOLIO

Notes to Consolidated Financial Statements

Currency Risk—Fluctuations in currency exchange rates may negatively affect the value of the Portfolio’s investments or reduce its returns.

Subsidiary Risk—By investing in the Subsidiary, the Portfolio is indirectly exposed to the risks associated with the Subsidiary’s investments. The derivatives and other investments held by the Subsidiary are generally similar to those that are permitted to be held by the Fund and are subject to the same risks that apply to similar investments if held directly by the Portfolio. The Subsidiary is not registered under the Investment Company Act of 1940, as amended (the “1940 Act”), and, unless otherwise noted in this Prospectus, is not subject to all of the investor protections of the 1940 Act. However, the Portfolio wholly owns and controls the Subsidiary, and the Portfolio and the Subsidiary are managed by the Adviser, making it unlikely the Subsidiary will take actions contrary to the interests of the Portfolio or its shareholders.

Real Estate Risk—The Portfolio’s investments in the real estate market have many of the same risks as direct ownership of real estate, including the risk that the value of real estate could decline due to a variety of factors that affect the real estate market generally. Investments in real estate investment trusts, or “REITs”, may have additional risks. REITs are dependent on the capability of their managers, may have limited diversification, and could be significantly affected by changes in taxes.

Diversification Risk—The Portfolio may have more risk because it is “non-diversified”, meaning that it can invest more of its assets in a smaller number of issuers and that adverse changes in the value of one security could have a more significant effect on the Portfolio’s NAV.

Indemnification Risk—In the ordinary course of business, the Portfolio enters into contracts that contain a variety of indemnifications. The Portfolio’s maximum exposure under these arrangements is unknown. However, the Portfolio has not had prior claims or losses pursuant to these indemnification provisions and expects the risk of loss thereunder to be remote.

NOTE G

Joint Credit Facility

A number of open-end mutual funds managed by the Adviser, including the Portfolio, participate in a $280 million revolving credit facility (the “Facility”) intended to provide short-term financing, if necessary, subject to certain restrictions in connection with abnormal redemption activity. Commitment fees related to the Facility are paid by the participating funds and are included in miscellaneous expenses in the consolidated statement of operations. The Portfolio did not utilize the Facility during the year ended October 31, 2015.

AB ALL MARKET REAL RETURN PORTFOLIO  • 57

Notes to Consolidated Financial Statements

NOTE H

Distributions to Shareholders

The tax character of distributions paid during the fiscal years ended October 31, 2015 and October 31, 2014 were as follows:

	2015		2014
Distributions paid from:
Ordinary income	$	14,402,445	$	9,000,069
Total distributions paid	$	14,402,445	$	9,000,069

As of October 31, 2015, the components of accumulated earnings/(deficit) on a tax basis were as follows:

Undistributed ordinary income	$	8,252,178
Accumulated capital and other losses		(45,493,925	)(a)
Unrealized appreciation/(depreciation)		(171,066,938	)(b)
Total accumulated earnings/(deficit)	$	(208,308,685	)

^(a) On October 31, 2015, the Portfolio had a net capital loss carryforward of $45,176,677. As of that date, the cumulative deferred loss on straddles was $317,248.

^(b) The differences between book-basis and tax-basis unrealized appreciation/(depreciation) are attributable primarily to the tax deferral of losses on wash sales, the tax treatment of partnerships and passive foreign investment companies (PFICs), the tax treatment of Treasury inflation-protected securities, the realization for tax purposes of gains/losses on certain derivative instruments, the tax treatment of a corporate restructuring, and the tax treatment of earnings from the Subsidiary.

For tax purposes, net capital losses may be carried over to offset future capital gains, if any. Funds are permitted to carry forward capital losses incurred in taxable years beginning after December 22, 2010 for an indefinite period. These post-December 22, 2010 capital losses must be utilized prior to the earlier capital losses, which are subject to expiration. Post-December 22, 2010 capital loss carryforwards will retain their character as either short-term or long-term capital losses rather than being considered short-term as under previous regulation.

As of October 31, 2015, the Portfolio had a net capital loss carryforward of $45,176,677 which will expire as follows:

Short-Term Amount	Long-Term Amount	Expiration
$  6,012,702	n/a	2019
24,477,600	$14,686,375	No expiration

During the current fiscal year, permanent differences primarily due to the tax treatment of swaps and passive foreign investment companies (PFICs), reclassifications of foreign currency and foreign capital gains tax, the book/tax differences associated with the treatment of earnings from the Subsidiary, the tax treatment of a corporate restructuring, return of capital distributions received

58 •  AB ALL MARKET REAL RETURN PORTFOLIO

Notes to Consolidated Financial Statements

from underlying securities, the tax treatment of partnership investments and contributions from the Adviser resulted in a net decrease in distributions in excess of net investment income, a net decrease in accumulated net realized loss on investment and foreign currency transactions, and a net decrease in additional paid-in capital. These reclassifications had no effect on net assets.

NOTE I

New Accounting Pronouncement

In May 2015, the Financial Accounting Standards Board issued an Accounting Standards Update (“ASU”), ASU 2015-07, which removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the net asset value per share practical expedient. The ASU also removes the disclosure requirement for investments not valued at net asset value. The ASU is effective for annual periods beginning after December 15, 2015 and interim periods within those annual periods. At this time, management is evaluating the implications of these changes on the financial statements.

NOTE J

Subsequent Events

Management has evaluated subsequent events for possible recognition or disclosure in the consolidated financial statements through the date the consolidated financial statements are issued. Management has determined that there are no material events that would require disclosure in the Portfolio’s consolidated financial statements through this date.

AB ALL MARKET REAL RETURN PORTFOLIO  • 59

Notes to Consolidated Financial Statements

CONSOLIDATED FINANCIAL HIGHLIGHTS

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class A
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.52			$  11.04			$  11.33			$  11.05			$  11.25
Income From Investment Operations
Net investment income(a)(b)		.06	(c)		.12			.10			.11			.16
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(2.26	)		(.50	)		(.13	)		.25			(.01	)
Contributions from Affiliates		.00	(c)		.00	(c)		– 0	–		– 0	–		– 0	–
Net increase (decrease) in net asset value from operations		(2.20	)		(.38	)		(.03	)		.36			.15
Less: Dividends
Dividends from net investment income		(.19	)		(.14	)		(.26	)		(.08	)		(.35	)
Net asset value, end of period		$    8.13			$  10.52			$  11.04			$  11.33			$  11.05
Total Return
Total investment return based on net asset value(d)		(21.16	)%		(3.45	)%		(.27	)%		3.36	%		1.32	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$16,611			$28,434			$64,800			$67,989			$70,081
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		1.30	%		1.23	%		1.05	%		1.05	%		1.05	%
Expenses, before waivers/reimbursements		1.47	%		1.30	%		1.34	%		1.28	%		1.61	%
Net investment income(b)		.62	%		1.03	%		.86	%		1.02	%		1.44	%
Portfolio turnover rate		53	%		73	%		54	%		118	%		120	%

See footnote summary on page 68.

60 •  AB ALL MARKET REAL RETURN PORTFOLIO

Consolidated Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class C
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.40			$  10.90			$  11.18			$  10.93			$  11.19
Income From Investment Operations
Net investment income (loss)(a)(b)		(.01	)		.04			.02			.03			.08
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(2.23	)		(.49	)		(.12	)		.25			(.01	)
Contributions from Affiliates		.00	(c)		.00	(c)		– 0	–		– 0	–		– 0	–
Net increase (decrease) in net asset value from operations		(2.24	)		(.45	)		(.10	)		.28			.07
Less: Dividends
Dividends from net investment income		(.13	)		(.05	)		(.18	)		(.03	)		(.33	)
Net asset value, end of period		$    8.03			$  10.40			$  10.90			$  11.18			$  10.93
Total Return
Total investment return based on net asset value(d)		(21.75	)%		(4.13	)%		(.92	)%		2.58	%		.61	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$4,202			$8,531			$13,063			$15,974			$17,414
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		2.00	%		1.93	%		1.75	%		1.75	%		1.75	%
Expenses, before waivers/reimbursements		2.16	%		2.02	%		2.04	%		1.99	%		2.31	%
Net investment income (loss)(b)		(.07	)%		.34	%		.16	%		.32	%		.73	%
Portfolio turnover rate		53	%		73	%		54	%		118	%		120	%

See footnote summary on page 68.

AB ALL MARKET REAL RETURN PORTFOLIO  • 61

Consolidated Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Advisor Class
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.56			$  11.09			$  11.37			$  11.08			$  11.26
Income From Investment Operations
Net investment income(a)(b)		.09			.15			.13			.15			.19
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(2.27	)		(.50	)		(.12	)		.25			(.01	)
Contributions from Affiliates		.00	(c)		.00	(c)		– 0	–		– 0	–		– 0	–
Net increase (decrease) in net asset value from operations		(2.18	)		(.35	)		.01			.40			.18
Less: Dividends
Dividends from net investment income		(.25	)		(.18	)		(.29	)		(.11	)		(.36	)
Net asset value, end of period		$    8.13			$  10.56			$  11.09			$  11.37			$  11.08
Total Return
Total investment return based on net asset value(d)		(20.95	)%		(3.20	)%		.12	%		3.69	%		1.55	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$30,541			$58,399			$64,911			$72,529			$50,795
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		1.00	%		.94	%		.75	%		.75	%		.75	%
Expenses, before waivers/reimbursements		1.17	%		1.02	%		1.04	%		.99	%		1.29	%
Net investment income(b)		.95	%		1.33	%		1.18	%		1.33	%		1.69	%
Portfolio turnover rate		53	%		73	%		54	%		118	%		120	%

See footnote summary on page 68.

62 •  AB ALL MARKET REAL RETURN PORTFOLIO

Consolidated Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class R
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.51			$  11.04			$  11.32			$  11.02			$  11.23
Income From Investment Operations
Net investment income(a)(b)		.04			.15			.08			.09			.16
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(2.24	)		(.55	)		(.13	)		.26			(.04	)
Contributions from Affiliates		.00	(c)		.00	(c)		– 0	–		– 0	–		– 0	–
Net increase (decrease) in net asset value from operations		(2.20	)		(.40	)		(.05	)		.35			.12
Less: Dividends
Dividends from net investment income		(.25	)		(.13	)		(.23	)		(.05	)		(.33	)
Net asset value, end of period		$    8.06			$  10.51			$  11.04			$  11.32			$  11.02
Total Return
Total investment return based on net asset value(d)		(21.37	)%		(3.66	)%		(.47	)%		3.20	%		1.03	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$162			$182			$38			$17			$11
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		1.50	%		1.44	%		1.25	%		1.25	%		1.25	%
Expenses, before waivers/reimbursements		1.64	%		1.55	%		1.65	%		1.64	%		2.87	%
Net investment income(b)		.42	%		1.36	%		.76	%		.82	%		1.39	%
Portfolio turnover rate		53	%		73	%		54	%		118	%		120	%

See footnote summary on page 68.

AB ALL MARKET REAL RETURN PORTFOLIO  • 63

Consolidated Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class K
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.50			$  11.03			$  11.32			$  11.05			$  11.25
Income From Investment Operations
Net investment income(a)(b)		.06			.12			.10			.10			.15
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(2.25	)		(.49	)		(.12	)		.27			– 0	–
Contributions from Affiliates		.00	(c)		.00	(c)		– 0	–		– 0	–		– 0	–
Net increase (decrease) in net asset value from operations		(2.19	)		(.37	)		(.02	)		.37			.15
Less: Dividends
Dividends from net investment income		(.24	)		(.16	)		(.27	)		(.10	)		(.35	)
Net asset value, end of period		$    8.07			$  10.50			$  11.03			$  11.32			$  11.05
Total Return
Total investment return based on net asset value(d)		(21.19	)%		(3.39	)%		(.19	)%		3.43	%		1.33	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$1,668			$2,174			$1,684			$1,286			$128
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		1.25	%		1.19	%		1.00	%		1.00	%		1.00	%
Expenses, before waivers/reimbursements		1.34	%		1.24	%		1.33	%		1.35	%		1.91	%
Net investment income(b)		.67	%		1.10	%		.95	%		.89	%		1.38	%
Portfolio turnover rate		53	%		73	%		54	%		118	%		120	%

See footnote summary on page 68.

64 •  AB ALL MARKET REAL RETURN PORTFOLIO

Consolidated Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class I
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.54			$  11.07			$  11.36			$  11.07			$  11.27
Income From Investment Operations
Net investment income(a)		.09			.15			.13	(b)		.14	(b)		.15	(b)
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(2.25	)		(.49	)		(.13	)		.26			.02	†
Contributions from Affiliates		.00	(c)		.00	(c)		– 0	–		– 0	–		– 0	–
Net increase (decrease) in net asset value from operations		(2.16	)		(.34	)		– 0	–		.40			.17
Less: Dividends
Dividends from net investment income		(.27	)		(.19	)		(.29	)		(.11	)		(.37	)
Net asset value, end of period		$    8.11			$  10.54			$  11.07			$  11.36			$  11.07
Total Return
Total investment return based on net asset value(d)		(20.97	)%		(3.09	)%		.04	%		3.69	%		1.53	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$14,508			$21,341			$19,303			$18,790			$15,850
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.96	%		.91	%		.75	%		.75	%		.75	%
Expenses, before waivers/reimbursements		.96	%		.91	%		.97	%		.98	%		1.38	%
Net investment income		.99	%		1.37	%		1.17	%(b)		1.32	%(b)		1.42	%(b)
Portfolio turnover rate		53	%		73	%		54	%		118	%		120	%

See footnote summary on page 68.

AB ALL MARKET REAL RETURN PORTFOLIO  • 65

Consolidated Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class 1
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.46			$  11.00			$  11.29			$  11.01			$  11.25
Income From Investment Operations
Net investment income(a)		.07			.13			.10	(b)		.12	(b)		.15	(b)
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(2.24	)		(.50	)		(.12	)		.25			(.01	)
Contributions from Affiliates		.00	(c)		.00	(c)		– 0	–		– 0	–		– 0	–
Net increase (decrease) in net asset value from operations		(2.17	)		(.37	)		(.02	)		.37			.14
Less: Dividends
Dividends from net investment income		(.24	)		(.17	)		(.27	)		(.09	)		(.38	)
Net asset value, end of period		$    8.05			$  10.46			$  11.00			$  11.29			$  11.01
Total Return
Total investment return based on net asset value(d)		(21.12	)%		(3.35	)%		(.19	)%		3.47	%		1.25	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$474,631			$513,633			$420,593			$221,971			$182,720
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		1.16	%		1.14	%		1.00	%		1.00	%		1.00	%
Expenses, before waivers/reimbursements		1.16	%		1.14	%		1.16	%		1.21	%		1.47	%
Net investment income		.79	%		1.16	%		.95	%(b)		1.07	%(b)		1.40	%(b)
Portfolio turnover rate		53	%		73	%		54	%		118	%		120	%

See footnote summary on page 68.

66 •  AB ALL MARKET REAL RETURN PORTFOLIO

Consolidated Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class 2
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.68			$  11.19			$  11.48			$  11.07			$  11.27
Income From Investment Operations
Net investment income(a)		.09			.15			.13	(b)		.15	(b)		.14	(b)
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(2.28	)		(.50	)		(.12	)		.26			.03	†
Contributions from Affiliates		.00	(c)		.00	(c)		– 0	–		– 0	–		– 0	–
Net increase (decrease) in net asset value from operations		(2.19	)		(.35	)		.01			.41			.17
Less: Dividends
Dividends from net investment income		(.27	)		(.16	)		(.30	)		– 0	–		(.37	)
Net asset value, end of period		$    8.22			$  10.68			$  11.19			$  11.48			$  11.07
Total Return
Total investment return based on net asset value(d)		(20.85	)%		(3.12	)%		.05	%		3.70	%		1.50	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$8			$11			$11			$11			$11
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.92	%		.89	%		.75	%		.75	%		.75	%
Expenses, before waivers/reimbursements		.92	%		.89	%		1.93	%		.96	%		3.72	%
Net investment income		.92	%		1.36	%		1.16	%(b)		1.32	%(b)		1.19	%(b)
Portfolio turnover rate		53	%		73	%		54	%		118	%		120	%

See footnote summary on page 68.

AB ALL MARKET REAL RETURN PORTFOLIO  • 67

Consolidated Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class Z
	Year Ended October 31,
	2015			January 31, (2014)(e) to October 31, 2014
Net asset value, beginning of period		$  10.55			$  10.53
Income From Investment Operations
Net investment income(a)		.07			.13
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(2.24	)		(.11	)
Contributions from Affiliates(c)		.00			.00
Net increase (decrease) in net asset value from operations		(2.17	)		.02
Less: Dividends
Dividends from net investment income		(.27	)		– 0	–
Net asset value, end of period		$    8.11			$  10.55
Total Return
Total investment return based on net asset value(d)		(20.94	)%		.19	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$3,166			$10
Ratio to average net assets of:
Expenses		.96	%		.88	%
Net investment income		.92	%		1.59	%
Portfolio turnover rate		53	%		73	%

(a) Based on average shares outstanding.

(b) Net of fees and expenses waived/reimbursed by the Adviser.

(c) Amount is less than $.005.

(d) Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Initial sales charges or contingent deferred sales charges are not reflected in the calculation of total investment return. Total return does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Total investment return calculated for a period of less than one year is not annualized.

(e) Commencement of distribution.

† Due to timing of sales and repurchase of capital shares, the net realized and unrealized gain (loss) per share is not in accord with the Portfolio’s change in net realized and unrealized gain (loss) on investment transactions for the period.

See notes to consolidated financial statements.

68 •  AB ALL MARKET REAL RETURN PORTFOLIO

Consolidated Financial Highlights

REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

To the Board of Directors of AB Bond Fund, Inc. and Shareholders of the AB All Market Real Return Portfolio

We have audited the accompanying consolidated statement of assets and liabilities, including the consolidated portfolio of investments, of AB All Market Real Return Portfolio (the “Fund”), formerly known as AllianceBernstein Real Asset Strategy Portfolio (one of the portfolios constituting AB Bond Fund, Inc., formerly known as AllianceBernstein Bond Fund, Inc.), as of October 31, 2015, and the related consolidated statement of operations for the year then ended, the consolidated statements of changes in net assets for each of the two years in the period then ended and the consolidated financial highlights for each of the periods indicated therein. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Fund’s internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of October 31, 2015, by correspondence with the custodian and others or by other appropriate auditing procedures where replies from others were not received. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the consolidated financial position of AB All Market Real Return Portfolio (one of the portfolios constituting the AB Bond Fund, Inc.) at October 31, 2015, the consolidated results of its operations for the year then ended, the consolidated changes in its net assets for each of the two years in the period then ended and the consolidated financial highlights for each of the periods indicated therein, in conformity with U.S. generally accepted accounting principles.

New York, New York

December 30, 2015

AB ALL MARKET REAL RETURN PORTFOLIO  • 69

Report of Independent Registered Public Accounting Firm

2015 FEDERAL TAX INFORMATION

(unaudited)

For Federal income tax purposes, the following information is furnished with respect to the distributions paid by the Portfolio during the taxable year ended October 31, 2015. For corporate shareholders, 15.24% of dividends paid qualify for the dividends received deduction. For foreign shareholders, 1.18% of ordinary income dividends paid may be considered to be qualifying to be taxed as interest-related dividends.

For the taxable year ended October 31, 2015, the Portfolio designates $9,157,926 as the maximum amount that may be considered qualified dividend income for individual shareholders.

Shareholders should not use the above information to prepare their income tax returns. The information necessary to complete your income tax returns will be included with your Form 1099-DIV which will be sent to you separately in January 2016.

70 •  AB ALL MARKET REAL RETURN PORTFOLIO

BOARD OF DIRECTORS

Marshall C. Turner, Jr.⁽¹⁾, Chairman John H. Dobkin⁽¹⁾ Michael J. Downey⁽¹⁾ William H. Foulk, Jr.⁽¹⁾ D. James Guzy⁽¹⁾ Nancy P. Jacklin⁽¹⁾ Robert M. Keith, President and Chief Executive Officer Garry L. Moody⁽¹⁾ Earl D. Weiner⁽¹⁾

OFFICERS

Philip L. Kirstein, Senior Vice President and Independent Compliance Officer Daniel J. Loewy⁽²⁾, Vice President Vinod Chathlani⁽²⁾, Vice President Vadim Zlotnikov⁽²⁾, Vice President Emilie D. Wrapp, Secretary Joseph J. Mantineo, Treasurer and Chief Financial Officer Phyllis J. Clarke, Controller Vincent S. Noto, Chief Compliance Officer

Custodian and Accounting Agent State Street Bank and Trust Company State Street Corporation CCB/5 1 Iron Street Boston, MA 02210   Principal Underwriter AllianceBernstein Investments, Inc. 1345 Avenue of the Americas New York, NY 10105   Transfer Agent AllianceBernstein Investor Services, Inc. P.O. Box 786003 San Antonio, TX 78278-6003 Toll-Free (800) 221-5672 Independent Registered Public
Accounting Firm Ernst & Young LLP 5 Times Square New York, NY 10036   Legal Counsel Seward & Kissel LLP One Battery Park Plaza New York, NY 10004

(1) Member of the Audit Committee, the Governance and Nominating Committee, and the Independent Directors Committee.

(2) The day-to-day management of, and investment decisions for, the Fund’s portfolio are made by the Adviser’s All Market Real Return Portfolio Team. Messrs. Loewy, Chathlani and Zlotnikov are the investment professionals with the most significant responsibility for the day-to-day management of the Fund’s portfolio.

AB ALL MARKET REAL RETURN PORTFOLIO  • 71

Board of Directors

MANAGEMENT OF THE FUND

Board of Directors Information

The business and affairs of the Strategy are managed under the direction of the Board of Directors. Certain information concerning the Strategy’s Directors is set forth below.

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
INTERESTED DIRECTOR
Robert M. Keith, + 1345 Avenue of the Americas New York, NY 10105 55 (2010)	Senior Vice President of AllianceBernstein L.P. (the “Adviser”) and the head of AllianceBernstein Investments, Inc. (“ABI”) since July 2008; Director of ABI and President of the AB Mutual Funds. Previously, he served as Executive Managing Director of ABI from December 2006 to June 2008. Prior to joining ABI in 2006, Executive Managing Director of Bernstein Global Wealth Management, and prior thereto, Senior Managing Director and Global Head of Client Service and Sales of the Adviser’s institutional investment management business since 2004. Prior thereto, he was Managing Director and Head of North American Client Service and Sales in the Adviser’s institutional investment management business, with which he had been associated since prior to 2004.		110	None

72 •  AB ALL MARKET REAL RETURN PORTFOLIO

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS
Marshall C. Turner, Jr., ++ Chairman of the Board 74 (2010)	Private Investor since prior to 2010. Former Chairman and CEO of Dupont Photomasks, Inc. (components of semi-conductor manufacturing). He also has extensive operating leadership and venture capital investment experience, including five interim or full-time CEO roles and prior service as general partner of institutional venture capital partnerships. He also has extensive non-profit board leadership, and currently serves on the boards of two education and science related non-profit organizations. He has served as a director of one AB fund since 1992, and director or trustee of multiple AB funds since 2005. He has been Chairman of the AB Funds since January 2014, and the Chairman of the Independent Directors Committees of such Funds since February 2014.		110	Xilinx, Inc. (programmable logic semi-conductors) since 2007
John H. Dobkin, ++ 73 (2010)	Independent Consultant since prior to 2010. Formerly, President of Save Venice, Inc. (preservation organization) from 2001–2002; Senior Advisor from June 1999-June 2000 and President of Historic Hudson Valley (historic preservation) from December 1989-May 1999. Previously, Director of the National Academy of Design. He has served as a director or trustee of various AB Funds since 1992, and as Chairman of the Audit Committees of a number of such Funds from 2001-2008.		110	None

AB ALL MARKET REAL RETURN PORTFOLIO  • 73

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
Michael J. Downey, ++ 71 (2010)	Private Investor since prior to 2010. Formerly, managing partner of Lexington Capital, LLC (investment advisory firm) from December 1997 until December 2003. He served as a Director of The Merger Fund (registered investment company) since prior to 2010 until 2013. He served as a Director of Prospect Acquisition Corp. (financial services) from 2007 until 2009. From 1987 until 1993, Chairman and CEO of Prudential Mutual Fund Management, director of the Prudential mutual funds, and member of the Executive Committee of Prudential Securities Inc. He has served as a director or trustee of the AB Funds since 2005 and is a director and Chairman of one other registered investment company.		110	Asia Pacific Fund, Inc. (registered investment company) since prior to 2010
William H. Foulk, Jr., ++ 83 (2010)	Investment Adviser and an Independent Consultant since prior to 2010. Previously, he was Senior Manager of Barrett Associates, Inc., a registered investment adviser. He was formerly Deputy Comptroller and Chief Investment Officer of the State of New York and, prior thereto, Chief Investment Officer of the New York Bank for Savings. He has served as a director or trustee of various AB Funds since 1983, and was Chairman of the Independent Directors Committees of the AB Funds from 2003 until early February 2014. He served as Chairman of such Funds from 2003 through December 2013. He is also active in a number of mutual fund related organizations and committees.		110	None

74 •  AB ALL MARKET REAL RETURN PORTFOLIO

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
D. James Guzy, ++ 79 (2010)	Chairman of the Board of SRC Computers, Inc. (semi-conductors), with which he has been associated since prior to 2010. He served as Chairman of the Board of PLX Technology (semi-conductors) since prior to 2010 until November 2013. He was a Director of Cirrus Logic Corporation (semi-conductors) from 1984 until July 2011. He was a director of Intel Corporation (semi-conductors) from 1969 until 2008, and served as Chairman of the Finance Committee of such company for several years until May 2008. He has served as a director or trustee of one or more of the AB Funds since 1982.		110	None
Nancy P. Jacklin, ++ 67 (2010)	Professorial Lecturer at the Johns Hopkins School of Advanced International Studies (2008-2015). U.S. Executive Director of the International Monetary Fund (which is responsible for ensuring the stability of the international monetary system), (December 2002-May 2006); Partner, Clifford Chance (1992-2002); Sector Counsel, International Banking and Finance, and Associate General Counsel, Citicorp (1985-1992); Assistant General Counsel (International), Federal Reserve Board of Governors (1982-1985); and Attorney Advisor, U.S. Department of the Treasury (1973-1982). Member of the Bar of the District of Columbia and of New York; and member of the Council on Foreign Relations. She has served as a director or trustee of the AB Funds since 2006 and has been Chairman of the Governance and Nominating Committees of the Funds since August 2014.		110	None

AB ALL MARKET REAL RETURN PORTFOLIO  • 75

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
Garry L. Moody, ++ 63 (2010)	Independent Consultant. Formerly, Partner, Deloitte & Touche LLP (1995-2008) where he held a number of senior positions, including Vice Chairman, and U.S. and Global Investment Management Practice Managing Partner; President, Fidelity Accounting and Custody Services Company (1993-1995); and Partner, Ernst & Young LLP (1975-1993), where he served as the National Director of Mutual Fund Tax Services and Managing Partner of its Chicago Office Tax department. He is a member of the Trustee Advisory Board of BoardIQ, a biweekly publication focused on issues and news affecting directors of mutual funds. He has served as a director or trustee, and as Chairman of the Audit Committees, of the AB Funds since 2008.		110	None
Earl D. Weiner, ++ 76 (2010)	Of Counsel, and Partner prior to January 2007, of the law firm Sullivan & Cromwell LLP and is a former member of the ABA Federal Regulation of Securities Committee Task Force to draft editions of the Fund Director’s Guidebook. He also serves as a director or trustee of various non-profit organizations and has served as Chairman or Vice Chairman of a number of them. He has served as a director or trustee of the AB Funds since 2007 and served as Chairman of the Governance and Nominating Committees of the AB Funds from 2007 until August 2014.		110	None

76 •  AB ALL MARKET REAL RETURN PORTFOLIO

Management of the Fund

* The address for each of the Strategy’s disinterested Directors is c/o AllianceBernstein L.P., Attention: Philip L. Kirstein, 1345 Avenue of the Americas, New York, NY 10105.

** There is no stated term of office for the Strategy’s Directors.

*** The information above includes each Director’s principal occupation during the last five years and other information relating to the experience, attributes and skills relevant to each Director’s qualifications to serve as a Director, which led to the conclusion that each Director should serve as a Director for the Strategy.

+ Mr. Keith is an “interested person” of the Strategy as defined in the “40 Act”, due to his position as a Senior Vice President of the Adviser.

++ Member of the Audit Committee, the Governance and Nominating Committee and the Independent Directors Committee.

AB ALL MARKET REAL RETURN PORTFOLIO  • 77

Management of the Fund

Officer Information

Certain information concerning the Strategy’s Officers is listed below.

NAME, ADDRESS* AND AGE	PRINCIPAL POSITION(S) HELD WITH FUND	PRINCIPAL OCCUPATION DURING PAST 5 YEARS
Robert M. Keith 55	President and Chief Executive Officer	See biography above.
Philip L. Kirstein 70	Senior Vice President and Independent Compliance Officer	Senior Vice President and Independent Compliance Officer of the AB Funds, with which he has been associated since October 2004. Prior thereto, he was Of Counsel to Kirkpatrick & Lockhart, LLP from October 2003 to October 2004, and General Counsel of Merrill Lynch Investment Managers, L.P. since prior to March 2003.
Daniel J. Loewy 41	Senior Vice President	Senior Vice President of the Adviser,** with which he has been associated since prior to 2010.
Vadim Zlotnikov 53	Senior Vice President	Senior Vice President of the Adviser,** with which he has been associated since prior to 2010.
Vinod Chathlani 32	Vice President	Assistant Vice President of the Adviser,** with which he has been associated since December 2013. Prior thereto, he was a risk analyst at Oppenheimer Funds and a corporate investment strategist at Reliance Communications since prior to 2010.
Emilie D. Wrapp 59	Secretary	Senior Vice President, Assistant General Counsel and Assistant Secretary of ABI,** with which she has been associated since prior to 2010.
Joseph J. Mantineo 56	Treasurer and Chief Financial Officer	Senior Vice President of AllianceBernstein Investor Services, Inc, (“ABIS”),** with which he has been associated since prior to 2010.
Phyllis J. Clarke 54	Controller	Vice President of ABIS,** with which she has been associated since prior to 2010.
Vincent S. Noto 50	Chief Compliance Officer	Senior Vice President since 2015 and Mutual Fund Chief Compliance Officer of the Adviser** since 2014. Prior thereto, he was Vice President and Director of Mutual Fund Compliance of the Adviser** since prior to 2010.

* The address for each of the Fund’s Officers is 1345 Avenue of the Americas, New York, NY 10105.

** The Adviser, ABI and ABIS are affiliates of the Strategy.

The Fund’s Statement of Additional Information (“SAI”) has additional information about the Strategy’s Directors and Officers and is available without charge upon request. Contact your financial representative or AB at 1-800-227-4618, or visit www.abglobal.com, for a free prospectus or SAI.

78 •  AB ALL MARKET REAL RETURN PORTFOLIO

Management of the Fund

THE FOLLOWING IS NOT PART OF THE SHAREHOLDER REPORT OR THE FINANCIAL STATEMENTS

SUMMARY OF SENIOR OFFICER’S EVALUATION OF INVESTMENT ADVISORY AGREEMENT¹

The following is a summary of the evaluation of the Investment Advisory Agreement between AllianceBernstein L.P. (the “Adviser”) and AB Bond Fund, Inc. (the “Fund”), in respect of AB All Market Real Return Portfolio (the “Portfolio”).^2,3 The evaluation of the Investment Advisory Agreement was prepared by Philip L. Kirstein, the Senior Officer of the Fund, for the Directors of the Fund, as required by the August 2004 agreement between the Adviser and the New York State Attorney General (the “NYAG”). The Senior Officer’s evaluation of the Investment Advisory Agreement is not meant to diminish the responsibility or authority of the Board of Directors of the Fund to perform its duties pursuant to Section 15 of the Investment Company Act of 1940 (the “40 Act”) and applicable state law. The purpose of this summary is to provide shareholders with a synopsis of the independent evaluation of the reasonableness of the advisory fees proposed to be paid by the Portfolio which was provided to the Directors in connection with their review of the proposed continuance of the Investment Advisory Agreement. The Senior Officer’s evaluation considered the following factors:

1. Advisory fees charged to institutional and other clients of the Adviser for like services;

2. Advisory fees charged by other mutual fund companies for like services;

3. Costs to the Adviser and its affiliates of supplying services pursuant to the advisory agreement, excluding any intra-corporate profit;

4. Profit margins of the Adviser and its affiliates from supplying such services;

5. Possible economies of scale as the Portfolio grows larger; and

6. Nature and quality of the Adviser’s services including the performance of the Portfolio.

These factors, with the exception of the first factor, are generally referred to as the “Gartenberg factors,” which were articulated by the United States Court of Appeals for the Second Circuit in 1982. Gartenberg v. Merrill Lynch Asset Management, Inc., 694 F. 2d 923 (2d Cir. 1982). On March 30, 2010, the Supreme Court held the Gartenberg decision was correct in its basic formulation of what Section 36(b) requires: to face liability under Section 36(b), “an investment

1 The Senior Officer’s fee evaluation was completed on October 22, 2015 and discussed with the Board of Directors on November 3-5, 2015.

2 Future references to the Fund or the Portfolio do not include “AB.”

3 Effective December 15, 2014, the Portfolio changed its name from Real Asset Strategy to All Market Real Return Portfolio.

AB ALL MARKET REAL RETURN PORTFOLIO  • 79

adviser must charge a fee that is so disproportionately large that it bears no reasonable relationship to the services rendered and could not have been the product of arm’s length bargaining. ”Jones v. Harris Associates L.P., 130 S. Ct. 1418 (2010). In Jones, the Court stated the Gartenberg approach fully incorporates the correct understanding of fiduciary duty within the context of Section 36(b) and noted with approval that “Gartenberg insists that all relevant circumstances be taken into account” and “uses the range of fees that might result from arm’s length bargaining as the benchmark for reviewing challenged fees.”⁴

INVESTMENT ADVISORY FEES, NET ASSETS & EXPENSE RATIOS

The Adviser proposed that the Portfolio pay the advisory fee set forth below for receiving the services to be provided pursuant to the Investment Advisory Agreement.

Portfolio	Net Assets 9/30/15 ($MM)	Advisory Fee Schedule Based on the Average Daily Net Assets of the Portfolio
All Market Real Return Portfolio	$522.9	0.75% (flat fee)

The Adviser is reimbursed as specified in the Investment Advisory Agreement for certain clerical, legal, accounting, administrative and other services provided to the Portfolio. During the Portfolio’s fiscal year ended October 31, 2014, the Adviser received $57,849 (0.009% of the Portfolio’s average daily net assets) for such services.

The Adviser agreed to waive that portion of its advisory fees and/or reimburse the Portfolio for that portion of the Portfolio’s total operating expenses to the degree necessary to limit the Portfolio’s expense ratios to the amounts set forth below for the Portfolio’s current fiscal year. The waiver is terminable by the

4 Jones v. Harris at 1427.

80 •  AB ALL MARKET REAL RETURN PORTFOLIO

Adviser upon at least 60 days’ notice prior to the Portfolio’s prospectus update. In addition, set forth below are the Portfolio’s gross expense ratios for the most recent semi-annual period.⁵

	Expense Cap Pursuant to Expense Limitation Undertaking6							Gross Expense Ratio7			Fiscal Year End
Portfolio		Current			Effective 02/01/16
All Market Real Return Portfolio8,9,10	Advisor		1.00	%		1.05	%		1.02	%	Oct. 31 (ratios as of Apr. 30, 2015)
	Class A		1.30	%		1.30	%		1.32	%
	Class C		2.00	%		2.05	%		2.03	%
	Class R		1.50	%		1.55	%		1.62	%
	Class K		1.25	%		1.30	%		1.32	%
	Class I		1.00	%		1.05	%		0.98	%
	Class Z		1.00	%		1.05	%		0.92	%
	Class 1		1.25	%		1.30	%		1.15	%
	Class 2		1.00	%		1.05	%		0.90	%

I. ADVISORY FEES CHARGED TO INSTITUTIONAL AND OTHER CLIENTS

The advisory fees charged to investment companies which the Adviser manages and sponsors are normally higher than those charged to similar sized institutional accounts, including pension plans and sub-advised investment companies. The fee differential reflects, among other things, different services provided to such clients, and different liabilities assumed. Services provided by the Adviser to the Portfolio that are not provided to non-investment company clients include providing office space and personnel to serve as Fund Officers, who among other responsibilities make the certifications required under the Sarbanes–Oxley Act of 2002, and coordinating with and monitoring the Portfolio’s third party service providers such as Fund counsel, auditors, custodians, transfer agents and pricing services. The accounting, administrative, legal and compliance requirements for the Portfolio are more costly than those for institutional client assets due to the greater complexities and time required for investment companies, although as

5 Semi-annual total expense ratios are unaudited.

6 The expense cap pursuant to the expense limitation undertaking for the Portfolio excludes interest expense.

7 Annualized.

8 The Rule 12b-1 fee for Class A shares will bill reduced from 0.30% to 0.25%, effective on February 1, 2016. The expense cap for Class A shares will remain at the same level (1.30%).

9 Class I, Class Z, Class 1, and Class 2 shares of the Portfolio were operating below their respective expense caps, and their net expense ratio during the most recent semi-annual period were 0.97%, 0.91%, 1.15% and 0.90, respectively.

10 The Portfolio’s fiscal percentage of net assets allocated to ETFs as of July 31, 2015 is 0.36%. The Portfolio’s acquired funds expense ratio related to such ETF holdings is 0.0022%.

AB ALL MARKET REAL RETURN PORTFOLIO  • 81

previously noted, the Adviser is reimbursed for providing such services. Also, retail mutual funds managed by the Adviser are widely held and accordingly, servicing the Portfolio’s investors is more time consuming and labor intensive compared to servicing institutional clients since the Adviser needs to communicate with a more extensive network of financial intermediaries and shareholders. The Adviser also believes that it incurs substantial entrepreneurial risk when offering a new mutual fund since establishing a new mutual fund requires a large upfront investment and it may take a long time for the fund to achieve profitability since the fund must be priced to scale from inception in order to be competitive and assets are acquired one account at a time. In addition, managing the cash flow of an investment company may be more difficult than that of a stable pool of assets, such as an institutional account with little cash movement in either direction, particularly if the Portfolio is in net redemption and the Adviser is frequently forced to sell securities to raise cash for redemptions. However, managing a fund with positive cash flow may be easier at times than managing a stable pool of assets. Finally, in recent years, investment advisers have been sued by institutional clients and have suffered reputational damage both by the attendant publicity and outcomes other than complete victories. Accordingly, the legal and reputational risks associated with institutional accounts are greater than previously thought, although arguably still not equal to those related to the mutual fund industry.

Notwithstanding the Adviser’s view that managing an investment company is not comparable to managing other institutional accounts because the services provided are different, the Supreme Court has indicated consideration should be given to the advisory fees charged to institutional accounts with a similar investment style as the Portfolio.¹¹ In addition to the AB Institutional fee schedule, set forth below is what would have been the effective advisory fee for the Portfolio had the AB Institutional fee schedule been applicable to the Portfolio versus the Portfolio’s advisory fees based on September 30, 2015 net assets:¹²

Portfolio	Net Assets 09/30/15 ($MM)	AB Institutional Fee Schedule	Effective AB Inst. Adv. Fee		Strategy Advisory Fee
All Market Real Return Portfolio	$522.9	Real Asset Strategy Schedule 0.75% on 1st $150 million 0.60% on next $150 million 0.50% on the balance Minimum acct size: $150 million		0.600%	0.750%

11 The Supreme Court stated that “courts may give such comparisons the weight that they merit in light of the similarities and differences between the services that the clients in question require, but the courts must be wary of inapt comparisons.” Among the significant differences the Supreme Court noted that may exist between services provided to mutual funds and institutional accounts are “higher marketing costs.” Jones v. Harris at 1428.

12 The Adviser has indicated that with respect to institutional accounts with assets greater than $300 million, it will negotiate a fee schedule. Discounts that are negotiated vary based upon each client relationship.

82 •  AB ALL MARKET REAL RETURN PORTFOLIO

The Adviser also manages and sponsors retail mutual funds, which are organized in jurisdictions outside the United States, generally Luxembourg, Japan, Taiwan, and South Korea, and sold to non-United States resident investors. The Adviser charges the following fees for Real Asset Portfolio, a Luxembourg fund that has a somewhat similar investment style as the Portfolio:

Portfolio	Luxembourg Fund	Fee13
All Market Real Return Portfolio	Real Asset Portfolio
	Class A	1.55%
	Class I (Institutional)	0.75%

The Adviser represented that it does not provide any sub-advisory investment services to other investment companies that have a substantially similar investment style as the Portfolio.

II. MANAGEMENT FEES CHARGED BY OTHER MUTUAL FUND COMPANIES FOR LIKE SERVICES.

Broadridge, Financial Solutions, Inc. (“Broadridge”), an analytical service that is not affiliated with the Adviser, compared the fees charged to the Portfolio with fees charged to other investment companies for similar services by other investment advisers.^{14,  15} Broadridge’s analysis included the comparison of the Portfolio’s contractual management fee, estimated at the approximate current asset level of the subject Portfolio, to the median of the Portfolio’s Broadridge Expense Group (“EG”)¹⁶ and the Portfolio’s contractual management fee ranking.¹⁷

13 Class A shares of the fund are charged an “all-in” fee, which includes investment advisory services and distribution related services, while Class I shares, whose fee is for investment advisory services only.

14 The Supreme Court cautioned against accepting mutual fund fee comparisons without careful scrutiny since “these comparisons are problematic because these fees, like those challenged, may not be the product of negotiations conducted at arm’s length.” Jones v. Harris at 1429.

15 On June 5, 2015, Broadridge acquired the Fiduciary Services and Competitive Intelligence unit, i.e., the group responsible for providing the Portfolio’s 15(c) reports, from Thomson Reuters’ Lipper division. The group that maintains Lipper’s expense and performance databases and investment classifications/objectives remains a part of Thomson Reuters’ Lipper division. Accordingly, the Portfolio’s investment classification/objective continues to be determined by Lipper.

16 Broadridge does not consider average account size when constructing EGs. Funds with relatively small average account sizes tend to have higher transfer agent expense ratios than comparable sized funds that have relatively large average account sizes. There are limitations to Lipper expense category data because different funds categorize expenses differently.

17 The contractual management fee is calculated by Broadridge using the Portfolio’s contractual management fee rate at the hypothetical asset level. The hypothetical asset level is based on the combined net assets of all classes of the Portfolio, rounded up to the next $25 million. Broadridge’s total expense ratio information is based on the most recent annual report except as otherwise noted. A ranking of “1” would mean that Portfolio had the lowest effective fee rate in the Broadridge peer group.

AB ALL MARKET REAL RETURN PORTFOLIO  • 83

Broadridge describes an EG as a representative sample of comparable funds. Broadridge’s standard methodology for screening funds to be included in an EG entails the consideration of several fund criteria, including fund type, Lipper investment classification/objective, load type, similar 12b-1/non-12b-1 service fees, asset (size) comparability, expense components and attributes. An EG will typically consist of seven to twenty funds.

Portfolio	Contractual Management Fee (%)		Broadridge EG Median (%)		Broadridge EG Rank
All Market Real Return Portfolio		0.750		0.804		7/16

Broadridge also compared the Portfolio’s total expense ratio to the medians of the Portfolio’s EG and Broadridge Expense Universe (“EU”). The EU is a broader group compared to the EG, consisting of all funds that have the same Lipper investment classification/objective and load type as the subject Portfolio.¹⁸ Pro-forma total expense ratio (italicized) is shown to reflect the Portfolio’s anticipated 12b-1 fee reduction.

Portfolio	Expense Ratio (%)		Broadridge EG Median (%)		Broadridge Group Rank	Broadridge EU Median (%)		Broadridge EU Rank
All Market Real Return Portfolio		1.230		1.277	7/16		1.288	36/97
Pro-forma		1.230		1.277	7/16		1.288	36/97

Based on this analysis, considering pro-forma information where available, the Portfolio has an equally favorable ranking on a total expense ratio basis and on a contractual management fee basis.

III. COSTS TO THE ADVISER AND ITS AFFILIATES OF SUPPLYING SERVICES PURSUANT TO THE MANAGEMENT FEE ARRANGEMENT, EXCLUDING ANY INTRA-CORPORATE PROFIT.

The Adviser utilizes two profitability reporting systems, which operate independently but are aligned with each other, to estimate the Adviser’s profitability in connection with investment advisory services provided to the Portfolio. The Senior Officer has retained a consultant to provide independent advice regarding the alignment of the two profitability systems as well as the methodologies and allocations utilized by both profitability systems. See Section IV for additional discussion.

18 Except for asset (size) comparability, Broadridge uses the same criteria for selecting an EG when selecting an EU. Unlike the EG, the EU allows for the same adviser to be represented by more than just one fund.

84 •  AB ALL MARKET REAL RETURN PORTFOLIO

IV. PROFIT MARGINS OF THE ADVISER AND ITS AFFILIATES FOR SUPPLYING SUCH SERVICES.

The profitability information for the Portfolio, prepared by the Adviser for the Board of Directors, was reviewed by the Senior Officer and the independent consultant. The Adviser’s profitability from providing investment advisory services to the Portfolio increased during calendar year 2014, relative to 2013.

In addition to the Adviser’s direct profits from managing the Portfolio, certain of the Portfolio’s affiliates have business relationships with the Portfolio and may earn a profit from providing other services to the Portfolio. The courts have referred to this type of business opportunity as “fall-out benefits” to the Adviser and indicated that such benefits should be factored into the evaluation of the total relationship between the Portfolio and the Adviser. Neither case law nor common business practice precludes the Adviser’s affiliates from earning a reasonable profit on this type of relationship provided the affiliates’ charges and services are competitive. These affiliates provide transfer agent, distribution and brokerage related services to the Portfolio and receive transfer agent fees, front-end sales loads, Rule 12b-1 payments, contingent deferred sales charges (“CDSC”) and brokerage commissions. In addition, the Adviser benefits from soft dollar arrangements which offset expenses the Adviser would otherwise incur. During the Portfolio‘s most recently completed fiscal year, ABI received from the Portfolio $996, $1,471,103 and $775 front-end sales charges, Rule 12b-1 and CDSC fees, respectively.¹⁹

AllianceBernstein Investments, Inc. (“ABI”), an affiliate of the Adviser, is the Portfolio’s principal underwriter. ABI and the Adviser have disclosed in the Portfolio’s prospectus that they may make revenue sharing payments from their own resources, in addition to revenues derived from sales loads and Rule 12b-1 fees, to firms that sell shares of the Portfolio. In 2014, ABI paid approximately 0.05% of the average monthly assets of the AB Mutual Funds or approximately $19.4 million for distribution services and educational support (revenue sharing payments).

Fees and reimbursements for out of pocket expenses charged by AllianceBernstein Investor Services, Inc. (“ABIS”), the affiliated transfer agent for the Portfolio, are charged on a per account basis, based on the level of service provided and the class of share held by the account. ABIS also receives a fee per shareholder sub-account for each account maintained by an intermediary on an omnibus basis. During the Portfolio’s most recently completed fiscal year, ABIS received $88,332 in fees from the Portfolio.

19 As a result of discussions between the Board and the Adviser, ABI will reduce the Portfolio’s Class A shares Rule 12b-1 fee payment rate from 0.30% to 0.25% effective on February 1, 2016.

AB ALL MARKET REAL RETURN PORTFOLIO  • 85

The Portfolio effected brokerage transactions through the Adviser’s affiliate, Sanford C. Bernstein & Co., LLC (“SCB & Co.”) and its U.K. affiliate, Sanford C. Bernstein Limited (“SCB Ltd.”), collectively “SCB,” and paid commissions for such transactions during the Portfolio’s most recently completed fiscal year. The Adviser represented that SCB’s profitability from business conducted with the Portfolio is comparable to the profitability of SCB’s dealings with other similar third party clients. In the ordinary course of business, SCB receives and pays liquidity rebates from electronic communications networks (“ECNs”) derived from trading for its clients. These credits and charges are not being passed onto to any SCB client. The Adviser also receives certain soft dollar benefits from brokers that execute agency trades for its clients. These soft dollar benefits reduce the Adviser’s research expense and increase its profitability.

V. POSSIBLE ECONOMIES OF SCALE

The Adviser has indicated that economies of scale are being shared with shareholders through pricing to scale, breakpoints, fee reductions/waivers and enhancement to services.

In May 2012, an independent consultant, retained by the Senior Officer, provided the Board of Directors information on the Adviser’s firm-wide average costs from 2005 through 2011 and the potential economies of scale. The independent consultant noted that from 2005 through 2007 the Adviser experienced significant growth in assets under management (“AUM”). During this period, operating expenses increased, in part to keep up with growth, and in part reflecting market returns. However, from 2008 through the first quarter of 2009, AUM rapidly and significantly decreased due to declines in market value and client withdrawals. When AUM rapidly decreased, some operating expenses categories, including base compensation and office space, adjusted more slowly during this period, resulting in an increase in average costs. Since 2009, AUM has experienced less significant changes. The independent consultant noted that changes in operating expenses reflect changes in business composition and business practices in response to changes in financial markets. Finally, the independent consultant concluded that the increase in average cost and the decline in net operating margin across the Adviser since late 2008 are inconsistent with the view that there are currently reductions in average costs due to economies of scale that can be shared with the AB Mutual Funds managed by the Adviser through lower fees.

Previously, in February 2008, the independent consultant provided the Board of Directors an update of the Deli²⁰ study on advisory fees and various fund

20 The Deli study, originally published in 2002 based on 1997 data and updated for the February 2008 Presentation, may be of diminished value due to the age of the data used in the presentation and the changes experienced in the industry since 2008.

86 •  AB ALL MARKET REAL RETURN PORTFOLIO

characteristics.²¹ The independent consultant first reiterated the results of his previous two dimensional comparison analysis (fund size and family size) with the Board of Directors.²² The independent consultant then discussed the results of the regression model that was utilized to study the effects of various factors on advisory fees. The regression model output indicated that the bulk of the variation in fees predicted were explained by various factors, but substantially by fund AUM, family AUM, index fund indicator and investment style. The independent consultant also compared the advisory fees of the AB Mutual Funds to similar funds managed by 19 other large asset managers, regardless of the fund size and each Adviser’s proportion of mutual fund assets to non-mutual fund assets.

VI. NATURE AND QUALITY OF THE ADVISER’S SERVICES, INCLUDING THE PERFORMANCE OF THE FUND

With assets under management of approximately $463 billion as of September 30, 2015, the Adviser has the investment experience to manage and provide non-investment services (described in Section I) to the Portfolio.

The information below shows the 1, 3, and 5 year performance returns and rankings of the Portfolio²³ relative to its Broadridge Performance Group (“PG”) and Broadridge Performance Universe (“PU”)²⁴ for the period ended July 31, 2015.²⁵

Portfolio	Fund Return (%)		PG Median (%)		PU Median (%)		PG Rank	PU Rank
All Market Real Return Portfolio
1 year		-25.18		3.13		-1.74	5/5	59/59
3 year		-6.53		7.09		2.30	5/5	39/39
5 year		-1.10		7.21		3.72	5/5	21/24

21 As mentioned previously, the Supreme Court cautioned against accepting mutual fund fee comparisons without careful scrutiny since the fees may not be the product of negotiations conducted at arm’s length. See Jones v. Harris at 1429.

22 The two dimensional analysis showed patterns of lower advisory fees for funds with larger asset sizes and funds from larger family sizes compared to funds with smaller asset sizes and funds from smaller family sizes, which according to the independent consultant is indicative of a sharing of economies of scale and scope. However, in less liquid and active markets, such is not the case, as the empirical analysis showed potential for diseconomies of scale in those markets. The empirical analysis also showed diminishing economies of scale and scope as funds surpassed a certain high level of assets.

23 The performance returns and rankings are for the Class A shares of the Portfolio. The performance returns of the Portfolio were provided Broadridge.

24 The Portfolio’s PG/PU is not identical to the Portfolio’s EG/EU as the criteria for including/excluding a fund in/from a PG/PU is somewhat different from that of an EG/EU.

25 The current Lipper investment classification/objective dictates the PG and PU throughout the life of the Portfolio even if the Portfolio may have had a different investment classification/objective at different points in time.

AB ALL MARKET REAL RETURN PORTFOLIO  • 87

Set forth below are the 1, 3, and 5 year and since inception net performance returns of the Portfolio (in bold)²⁶ versus its benchmark.²⁷ Portfolio and benchmark volatility and reward-to-variability ratio (“Sharpe Ratio”) information is also shown.²⁸

	Period Ending July 31, 2015 Annualized Net Performance
	1 Year (%)		3 Year (%)		5 Year (%)		Since Inception (%)		Volatility (%)		Sharpe (%)		Risk Period (Year)
All Market Real Return Portfolio		-25.18		-6.53		-1.10		-1.24		14.69		-0.01		5
MSCI AC World Commodity Producers Index		-30.57		-6.39		-3.02		-4.23		N/A		N/A		N/A
All Market Real Return Index		-19.81		-4.17		-0.12		-0.40		14.82		0.06		5
Inception Date: March 8, 2010

CONCLUSION:

Based on the factors discussed above the Senior Officer’s conclusion is that the proposed advisory fee for the Portfolio is reasonable and within the range of what would have been negotiated at arm’s-length in light of all the surrounding circumstances. This conclusion in respect of the Portfolio is based on an evaluation of all of these factors and no single factor was dispositive.

Dated: November 25, 2015

26 The performance returns and risk measures shown in the table are for the Class A shares of the Portfolio.

27 The Adviser provided Portfolio and benchmark performance return information for the periods through July 31, 2015.

28 Portfolio and benchmark volatility and Sharpe Ratio information was obtained through Lipper LANA, a database maintained by Lipper. Volatility is a statistical measure of the tendency of a market price or yield to vary over time. A Sharpe Ratio is a risk adjusted measure of return that divides a fund’s return in excess of the riskless return by the fund’s standard deviation. A fund with a greater volatility would be viewed as more risky than a fund with equivalent performance but lower volatility; for that reason, a greater return would be demanded for the more risky fund. A fund with a higher Sharpe Ratio would be viewed as better performing than a fund with a lower Sharpe Ratio.

88 •  AB ALL MARKET REAL RETURN PORTFOLIO

THIS PAGE IS NOT PART OF THE SHAREHOLDER REPORT OR THE FINANCIAL STATEMENTS

AB FAMILY OF FUNDS

US EQUITY

US Core

Core Opportunities Fund

Select US Equity Portfolio

US Growth

Concentrated Growth Fund

Discovery Growth Fund

Growth Fund

Large Cap Growth Fund

Small Cap Growth Portfolio

US Value

Discovery Value Fund

Equity Income Fund

Growth & Income Fund

Small Cap Value Portfolio

Value Fund

INTERNATIONAL/ GLOBAL EQUITY

International/Global Core

Global Core Equity Portfolio

Global Equity & Covered Call Strategy Fund

Global Thematic Growth Fund

International Portfolio

Tax-Managed International Portfolio

International/Global Growth

International Growth Fund

International/Global Value

Asia ex-Japan Equity Portfolio

International Value Fund

FIXED INCOME

Municipal

High Income Municipal Portfolio

Intermediate California Municipal Portfolio

Intermediate Diversified Municipal Portfolio

Intermediate New York Municipal Portfolio

Municipal Bond Inflation Strategy

FIXED INCOME (continued)

Tax-Aware Fixed Income Portfolio

National Portfolio

Arizona Portfolio

California Portfolio

Massachusetts Portfolio

Michigan Portfolio

Minnesota Portfolio

New Jersey Portfolio

New York Portfolio

Ohio Portfolio

Pennsylvania Portfolio

Virginia Portfolio

Taxable

Bond Inflation Strategy

Global Bond Fund

High Income Fund

High Yield Portfolio

Intermediate Bond Portfolio

Limited Duration High Income Portfolio

Short Duration Portfolio

ALTERNATIVES

All Market Real Return Portfolio*

Credit Long/Short Portfolio

Global Real Estate Investment Fund

Long/Short Multi-Manager Fund

Multi-Manager Alternative Strategies Fund

Select US Long/Short Portfolio

Unconstrained Bond Fund

MULTI-ASSET

All Market Growth Portfolio*

All Market Income Portfolio

Emerging Markets Multi-Asset Portfolio

Global Risk Allocation Fund

MULTI-ASSET (continued)

Target-Date

Multi-Manager Select Retirement Allocation Fund

Multi-Manager Select 2010 Fund

Multi-Manager Select 2015 Fund

Multi-Manager Select 2020 Fund

Multi-Manager Select 2025 Fund

Multi-Manager Select 2030 Fund

Multi-Manager Select 2035 Fund

Multi-Manager Select 2040 Fund

Multi-Manager Select 2045 Fund

Multi-Manager Select 2050 Fund

Multi-Manager Select 2055 Fund

Wealth Strategies

Balanced Wealth Strategy

Conservative Wealth Strategy

Wealth Appreciation Strategy

Tax-Managed Balanced Wealth Strategy

Tax-Managed Conservative Wealth Strategy

Tax-Managed Wealth Appreciation Strategy

CLOSED-END FUNDS

AB Multi-Manager Alternative Fund

Alliance California Municipal Income Fund

AllianceBernstein Global High Income Fund

AllianceBernstein Income Fund

AllianceBernstein National Municipal Income Fund

We also offer Exchange Reserves, which serves as the money market fund exchange vehicle for the AB mutual funds. An investment in Exchange Reserves is not a deposit in a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.

Investors should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.abglobal.com or contact your AB representative. Please read the prospectus and/or summary prospectus carefully before investing.

* Prior to December 15, 2014, All Market Growth Portfolio was named Dynamic All Market Fund; All Market Real Return Portfolio was named Real Asset Strategy.

AB ALL MARKET REAL RETURN PORTFOLIO  • 89

AB Family of Funds

NOTES

90 •  AB ALL MARKET REAL RETURN PORTFOLIO

NOTES

AB ALL MARKET REAL RETURN PORTFOLIO  • 91

NOTES

92 •  AB ALL MARKET REAL RETURN PORTFOLIO

AB ALL MARKET REAL RETURN PORTFOLIO

1345 Avenue of the Americas

New York, NY 10105

800.221.5672

AMRR-0151-1015                

OCT    ^10.31.15

ANNUAL REPORT

AB BOND INFLATION STRATEGY

Investment Products Offered

• Are Not FDIC Insured

• May Lose Value

• Are Not Bank Guaranteed

Investors should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.abglobal.com or contact your AB representative. Please read the prospectus and/or summary prospectus carefully before investing.

This shareholder report must be preceded or accompanied by the Fund’s prospectus for individuals who are not current shareholders of the Fund.

You may obtain a description of the Fund’s proxy voting policies and procedures, and information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30, without charge. Simply visit AB’s website at www.abglobal.com, or go to the Securities and Exchange Commission’s (the “Commission”) website at www.sec.gov, or call AB at (800) 227-4618.

The Fund files its complete schedule of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q are available on the Commission’s website at www.sec.gov. The Fund’s Forms N-Q may also be reviewed and copied at the Commission’s Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330. AB publishes full portfolio holdings for the Fund monthly at www.abglobal.com.

AllianceBernstein Investments, Inc. (ABI) is the distributor of the AB family of mutual funds. ABI is a member of FINRA and is an affiliate of AllianceBernstein L.P., the Adviser of the funds.

The [A/B] logo is a registered service mark of AllianceBernstein and AllianceBernstein^® is a registered service mark used by permission of the owner, AllianceBernstein L.P.

December 21, 2015

Annual Report

This report provides management’s discussion of fund performance for AB Bond Inflation Strategy (the “Strategy”) for the annual reporting period ended October 31, 2015. Effective January 20, 2015, the Strategy’s name changed from AllianceBernstein Bond Inflation Strategy to AB Bond Inflation Strategy.

Investment Objectives and Policies

The Strategy seeks to maximize real return without assuming what AllianceBernstein L.P. (the “Adviser”) considers to be undue risk. Real return is the rate of return after adjusting for inflation. The Strategy pursues its objective by investing principally in inflation-indexed securities (such as Treasury Inflation-Protected Securities (“TIPS”), or inflation-indexed securities from issuers other than the US Treasury) or by gaining inflation protection through derivatives transactions, such as inflation (“CPI”) swaps or total return swaps linked to TIPS. In deciding whether to purchase inflation-indexed securities or use inflation-linked derivatives transactions, the Adviser will consider the relative costs and efficiency of each method. In addition, in seeking to maximize real return, the Strategy may invest in other fixed-income investments such as US and non-US government securities, corporate fixed-income securities and mortgage-related securities, as well as derivatives linked to such securities.

Under normal circumstances, the Strategy invests at least 80% of its net assets in fixed-income securities. While the Strategy expects to invest principally in investment-grade securities, it may

invest up to 15% of its total assets in fixed-income securities rated BB or B or the equivalent by at least one national rating agency (or deemed by the Adviser to be of comparable credit quality), which are not investment-grade (“junk bonds”).

Inflation-indexed securities are fixed-income securities structured to provide protection against inflation. Their principal value and/or the interest paid on them are adjusted to reflect official inflation measures. The inflation measure for TIPS is the Consumer Price Index for Urban Consumers. The Strategy may also invest in other inflation-indexed securities, issued by both US and non-US issuers, and in derivative instruments linked to these securities.

The Strategy may invest in derivatives, such as options, futures, forwards or swaps. The Strategy intends to use leverage for investment purposes. To do this, the Strategy expects to enter into (i) reverse repurchase agreement transactions and use the cash made available from these transactions to make additional investments in fixed-income securities in accordance with the Strategy’s investment policies and (ii) total return swaps. In determining when and to what extent to employ leverage or enter into derivatives transactions, the Adviser will consider factors such as the relative risks and returns expected of potential investments and the costs of such transactions. The Adviser will consider the impact of reverse repurchase agreements, swaps and other derivatives in making its assessments of the Strategy’s risks. The

AB BOND INFLATION STRATEGY  • 1

resulting exposures to markets, sectors, issuers or specific securities will be continuously monitored by the Adviser.

The Adviser selects securities for purchase or sale based on its assessment of the securities’ risk and return characteristics as well as the securities’ impact on the overall risk and return characteristics of the Strategy. In making this assessment, the Adviser takes into account various factors, including the credit quality and sensitivity to interest rates of the securities under consideration and of the Strategy’s other holdings.

The Strategy may also invest in loan participations, structured securities, asset-backed securities, variable, floating, and inverse floating-rate instruments, and preferred stock, and may use other investment techniques. The Strategy may invest in fixed-income securities of any maturity and duration. If the rating of a fixed-income security falls below investment-grade, the Strategy will not be obligated to sell the security and may continue to hold it if, in the Adviser’s opinion, the investment is appropriate under the circumstances.

Investment Results

The table on page 6 shows the Strategy’s performance compared to its benchmark, the Barclays 1-10 Year TIPS Index, and to the Lipper TIPS Fund Average (the “Lipper Average”) for the six- and 12-month periods ended October 31, 2015. Funds in the Lipper Average have generally similar investment objectives to the Strategy, although some of the funds may have different investment policies

and sales and management fees and fund expenses. The inception date for Class Z shares was December 11, 2014; due to limited performance history, there is no discussion of comparison to the benchmark and Lipper Average for this share class.

For the six-month period, all share classes underperformed the benchmark, before sales charges; all share classes outperformed the Lipper Average except Class C and Class R shares. For the 12-month period, all share classes underperformed the benchmark, before sales charges; all share classes outperformed the Lipper Average except Class C, Class K and Class R shares. During both periods, TIPS performed poorly on an absolute basis and relative to comparable maturity Treasuries, as a significant drop in commodity prices including oil and metals dampened inflation expectations. Currency positioning contributed to returns, specifically the Strategy’s long US dollar position against short euro, Canadian dollar and Australian dollar positions. Sector allocation detracted for both periods mainly from an overweight to investment-grade corporates, relative to the benchmark. Yield-curve positioning had an immaterial impact on performance for both periods.

During both periods, the Strategy utilized derivatives including currency forwards to manage active currency positions. Credit default swaps were utilized for hedging and investment purposes, and written options were used for hedging purposes, which had an immaterial impact on performance during both periods, in absolute terms. Treasury futures, and interest rate and CPI swaps, were utilized to manage

2 •  AB BOND INFLATION STRATEGY

the duration, inflation protection, country exposure and yield curve positioning of the Strategy.

Market Review and Investment Strategy

Bond markets were volatile for the 12-month period ended October 31, 2015, as growth trends and monetary policies in the world’s biggest economies headed in different directions. Inflation continued to fall throughout the developed world, driven primarily by decreasing commodity prices. While oil prices began to rebound in April, they again fell in August, remaining well below their price range in late 2014. These dynamics caused volatility within government bond yields, with the yield on the 10-year US Treasury ranging from 1.7% to 2.5%, ultimately ending the period at 2.2%. Adding to the volatility, the US Federal Reserve postponed its long expected interest-rate hike, alluding to emerging market turmoil as one of the reasons.

In other markets, including many in Europe where the European Central Bank implemented its quantitative easing program, some yields ended the period in negative territory. In emerging markets, political and economic instability across regions negatively affected the investment environment. Slower growth in China, Brazil and other emerging market economies caused further pressure on credit markets at the end of the 12-month period. Against this backdrop, fixed-income returns diverged between regions and sectors. Credit securities generally underperformed developed market Treasuries; developed market Treasuries generally outperformed emerging market local currency Treasuries; and investment-grade securities generally outperformed high-yield, which posted some of the worst returns across the fixed-income market, specifically within the energy and commodities sectors.

AB BOND INFLATION STRATEGY  • 3

DISCLOSURES AND RISKS

Benchmark Disclosure

The unmanaged Barclays 1-10 Year TIPS Index does not reflect fees and expenses associated with the active management of a mutual fund portfolio. The Barclays 1-10 Year TIPS Index represents the performance of inflation-protected securities issued by the US Treasury. An investor cannot invest directly in an index, and its results are not indicative of the performance for any specific investment, including the Strategy.

A Word About Risk

Market Risk: The value of the Strategy’s assets will fluctuate as the bond market fluctuates. The value of the Strategy’s investments may decline, sometimes rapidly and unpredictably, simply because of economic changes or other events that affect large portions of the market.

Credit Risk: An issuer or guarantor of a fixed-income security, or the counterparty to a derivatives or other contract, may be unable or unwilling to make timely payments of interest or principal, or to otherwise honor its obligations. The issuer or guarantor may default, causing a loss of the full principal amount of a security. The degree of risk for a particular security may be reflected in its credit rating. There is the possibility that the credit rating of a fixed-income security may be downgraded after purchase, which may adversely affect the value of the security. Investments in fixed-income securities with lower ratings tend to have a higher probability that an issuer will default or fail to meet its payment obligations.

Interest Rate Risk: Changes in interest rates will affect the value of investments in fixed-income securities. When interest rates rise, the value of investments in fixed-income securities tends to fall and this decrease in value may not be offset by higher income from new investments. The Strategy may be subject to a heightened risk of rising interest rates due to the current period of historically low rates and the effect of government fiscal policy initiatives, including Federal Reserve actions, and market reaction to these initiatives. The current period of historically low rates is expected to end and rates are expected to begin rising in the near future. Interest rate risk is generally greater for fixed-income securities with longer maturities or durations.

Duration Risk: Duration is a measure that relates the expected price volatility of a fixed-income security to changes in interest rates. The duration of a fixed-income security may be shorter than or equal to full maturity of a fixed-income security. Fixed-income securities with longer durations have more risk and will decrease in price as interest rates rise. For example, a fixed-income security with a duration of three years will decrease in value by approximately 3% if interest rates increase by 1%.

Inflation Risk: This is the risk that the value of assets or income from investments will be less in the future as inflation decreases the value of money. As inflation increases, the value of the Strategy’s assets can decline as can the value of the Strategy’s distributions. This risk is significantly greater for fixed-income securities with longer maturities. Although the Strategy invests principally in inflation-indexed securities, the value of its securities may be vulnerable to changes in expectations of inflation or interest rates.

Derivatives Risk: Derivatives may be illiquid, difficult to price, and leveraged so that small changes may produce disproportionate losses for the Strategy, and may be subject to counterparty risk to a greater degree than more traditional investments.

Foreign (Non-US) Risk: Investments in securities of non-US issuers may involve more risk than those of US issuers. These securities may fluctuate more widely in price and may be less liquid due to adverse market, economic, political, regulatory or other factors.

Currency Risk: Fluctuations in currency exchange rates may negatively affect the value of the Strategy’s investments or reduce its returns.

(Disclosures, Risks and Note about Historical Performance continued on next page)

4 •  AB BOND INFLATION STRATEGY

Disclosures and Risks

DISCLOSURES AND RISKS

(continued from previous page)

Leverage Risk: To the extent the Strategy uses leveraging techniques, its net asset value (“NAV”) may be more volatile because leverage tends to exaggerate the effect of changes in interest rates and any increase or decrease in the value of the Strategy’s investments.

Liquidity Risk: Liquidity risk occurs when certain investments become difficult to purchase or sell. Difficulty in selling less liquid securities may result in sales at disadvantageous prices affecting the value of your investment in the Strategy. Causes of liquidity risk may include low trading volumes, large positions and heavy redemptions of Strategy shares. Over recent years liquidity risk has also increased because the capacity of dealers in the secondary market for fixed-income securities to make markets in these securities has decreased, even as the overall bond market has grown significantly, due to, among other things, structural changes, additional regulatory requirements and capital and risk restraints that have led to reduced inventories. Liquidity risk may be higher in a rising interest rate environment, when the value and liquidity of fixed-income securities generally go down.

Management Risk: The Strategy is subject to management risk because it is an actively-managed investment fund. The Adviser will apply its investment techniques and risk analyses in making investment decisions, but there is no guarantee that its techniques will produce the intended results.

These risks are fully discussed in the Strategy’s prospectus. As with all investments, you may lose money by investing in the Strategy.

An Important Note About Historical Performance

The investment return and principal value of an investment in the Strategy will fluctuate, so that shares, when redeemed, may be worth more or less than their original cost. Performance shown on the following pages represents past performance and does not guarantee future results. Current performance may be lower or higher than the performance information shown. You may obtain performance information current to the most recent month-end by visiting www.abglobal.com. For Class 1 shares, click on “Private Clients”, then “Investments”, then “Stocks” or “Bonds”, then “Mutual Fund Performance at a Glance”.

All fees and expenses related to the operation of the Strategy have been deducted. NAV returns do not reflect sales charges; if sales charges were reflected, the Strategy’s quoted performance would be lower. SEC returns reflect the applicable sales charges for each share class: a 4.25% maximum front-end sales charge for Class A shares; a 1% 1-year contingent deferred sales charge for Class C shares. Class 1 and Class 2 shares do not carry sales charges. Returns for the different share classes will vary due to different expenses associated with each class. Performance assumes reinvestment of distributions and does not account for taxes.

AB BOND INFLATION STRATEGY  • 5

Disclosures and Risks

HISTORICAL PERFORMANCE

THE STRATEGY VS. ITS BENCHMARK PERIODS ENDED OCTOBER 31, 2015 (unaudited)	NAV Returns
	6 Months		12 Months
AB Bond Inflation Strategy
Class 1*		-2.51%		-2.04%
Class 2*		-2.45%		-1.95%
Class A		-2.59%		-2.18%
Class C		-2.95%		-2.93%
Advisor Class†		-2.45%		-1.90%
Class R†		-2.68%		-2.49%
Class K†		-2.57%		-2.24%
Class I†		-2.46%		-1.88%
Class Z†		-2.34%		-0.86%	‡
Barclays 1-10 Year TIPS Index		-1.83%		-1.24%
Lipper TIPS Fund Average		-2.60%		-2.21%
*    Class 1 shares are only available to Bernstein Global Wealth Management private client accounts. Class 2 shares are only available to large Bernstein Global Wealth Management private client accounts and the Adviser’s institutional clients or through other limited arrangements. †      Please note that these share classes are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Strategy. ‡      Since inception on December 11, 2014.

See Disclosures, Risks and Note about Historical Performance on pages 4-5.

(Historical Performance continued on next page)

6 •  AB BOND INFLATION STRATEGY

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

GROWTH OF A $10,000 INVESTMENT IN THE STRATEGY

1/26/10* TO 10/31/15 (unaudited)

This chart illustrates the total value of an assumed $10,000 investment in AB Bond Inflation Strategy Class A shares (from 1/26/10* to 10/31/15) as compared to the performance of the Strategy’s benchmark. The chart reflects the deduction of the maximum 4.25% sales charge from the initial $10,000 investment in the Strategy and assumes the reinvestment of dividends and capital gains distributions.

* Inception date: 1/26/2010.

See Disclosures, Risks and Note about Historical Performance on pages 4-5.

(Historical Performance continued on next page)

AB BOND INFLATION STRATEGY  • 7

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

AVERAGE ANNUAL RETURNS AS OF OCTOBER 31, 2015 (unaudited)
	NAV Returns			SEC Returns (reflects applicable sales charges)			SEC Yields*
Class 1 Shares†								0.78	%
1 Year		-2.04	%		-2.04	%
5 Years		1.49	%		1.49	%
Since Inception‡		2.39	%		2.39	%
Class 2 Shares†								0.87	%
1 Year		-1.95	%		-1.95	%
5 Years		1.58	%		1.58	%
Since Inception‡		2.47	%		2.47	%
Class A Shares								0.47	%
1 Year		-2.18	%		-6.36	%
5 Years		1.29	%		0.41	%
Since Inception‡		2.17	%		1.41	%
Class C Shares								-0.22	%
1 Year		-2.93	%		-3.89	%
5 Years		0.56	%		0.56	%
Since Inception‡		1.44	%		1.44	%
Advisor Class Shares^								0.79	%
1 Year		-1.90	%		-1.90	%
5 Years		1.57	%		1.57	%
Since Inception‡		2.47	%		2.47	%
Class R Shares^								0.13	%
1 Year		-2.49	%		-2.49	%
5 Years		1.08	%		1.08	%
Since Inception‡		1.97	%		1.97	%
Class K Shares^								0.44	%
1 Year		-2.24	%		-2.24	%
5 Years		1.32	%		1.32	%
Since Inception‡		2.21	%		2.21	%
Class I Shares^								0.78	%
1 Year		-1.88	%		-1.88	%
5 Years		1.59	%		1.59	%
Since Inception‡		2.49	%		2.49	%
Class Z Shares^								0.87	%
Since Inception‡		-0.86	%		-0.86	%

See Disclosures, Risks and Note about Historical Performance on pages 4-5.

(Historical Performance continued on next page)

8 •  AB BOND INFLATION STRATEGY

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

The Strategy’s prospectus fee table shows the Strategy’s total annual operating expense ratios as 0.77%, 0.67%, 1.15%, 1.86%, 0.86%, 1.40%, 1.07%, 0.69% and 0.68% for Class 1, Class 2, Class A, Class C, Advisor Class, Class R, Class K, Class I and Class Z shares, respectively, gross of any fee waivers or expense reimbursements. Contractual fee waivers and/or expense reimbursements limit the Strategy’s annual operating expenses (exclusive of interest expense) to 0.60%, 0.50%, 0.80%, 1.50%, 0.50%, 1.00%, 0.75%, 0.50% and 0.50% for Class 1, Class 2, Class A, Class C, Advisor Class, Class R, Class K, Class I and Class Z shares, respectively. These waivers/reimbursements may not be terminated before January 29, 2016 and may be extended by the Adviser for additional one-year terms. Absent reimbursements or waivers, performance would have been lower. The Financial Highlights section of this report sets forth expense ratio data for the current reporting period; the expense ratios shown above may differ from the expense ratios in the Financial Highlights sections since they are based on different time periods.

* SEC yields are calculated based on SEC guidelines for the 30-day period ended October 31, 2015.

^†  Class 1 shares are only available to Bernstein Global Wealth Management private client accounts. Class 2 shares are only available to large Bernstein Global Wealth Management private client accounts and the Adviser’s institutional clients or through other limited arrangements. These share classes do not carry front-end sales charges, therefore their respective NAV and SEC returns are the same.

^‡  Inception date for all share classes excluding Class Z: 1/26/2010; 12/11/2014 for Class Z shares.

^{^}  These share classes are offered at NAV to eligible investors and their SEC returns are the same as their NAV returns. Please note that these share classes are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Strategy. The inception date for these share classes is listed above.

See Disclosures, Risks and Note about Historical Performance on pages 4-5.

(Historical Performance continued on next page)

AB BOND INFLATION STRATEGY  • 9

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

SEC AVERAGE ANNUAL RETURNS AS OF THE MOST RECENT CALENDAR QUARTER-END SEPTEMBER 30, 2015 (unaudited)
	SEC Return (reflects applicable sales charges)
Class 1 Shares†
1 Year		-1.95	%
5 Years		1.80	%
Since Inception‡		2.39	%
Class 2 Shares†
1 Year		-1.87	%
5 Years		1.89	%
Since Inception‡		2.48	%
Class A Shares
1 Year		-6.38	%
5 Years		0.68	%
Since Inception‡		1.38	%
Class C Shares
1 Year		-3.81	%
5 Years		0.87	%
Since Inception‡		1.45	%
Advisor Class Shares^
1 Year		-1.91	%
5 Years		1.86	%
Since Inception‡		2.46	%
Class R Shares^
1 Year		-2.41	%
5 Years		1.37	%
Since Inception‡		1.97	%
Class K Shares^
1 Year		-2.06	%
5 Years		1.62	%
Since Inception‡		2.21	%
Class I Shares^
1 Year		-1.79	%
5 Years		1.90	%
Since Inception‡		2.49	%
Class Z Shares^
Since Inception‡		-1.15	%

See Disclosures, Risks and Note about Historical Performance on pages 4-5.

(Historical Performance continued on next page)

10 •  AB BOND INFLATION STRATEGY

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

^†  Class 1 shares are only available to Bernstein Global Wealth Management private client accounts. Class 2 shares are only available to large Bernstein Global Wealth Management private client accounts and the Adviser’s institutional clients or through other limited arrangements.

^‡  Inception date for all share classes excluding Class Z: 1/26/2010; 12/11/2014 for Class Z shares.

^{^}  These share classes are offered at NAV to eligible investors and their SEC returns are the same as their NAV returns. Please note that these share classes are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Strategy. The inception date for these share classes is listed above.

See Disclosures, Risks and Note about Historical Performance on pages 4-5.

AB BOND INFLATION STRATEGY  • 11

Historical Performance

EXPENSE EXAMPLE

(unaudited)

As a shareholder of a mutual fund, you may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, contingent deferred sales charges on redemptions and (2) ongoing costs, including management fees; distribution (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period as indicated below.

Actual Expenses

The table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed annual rate of return of 5% before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds by comparing this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), or contingent deferred sales charges on redemptions. Therefore, the hypothetical example is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Beginning Account Value May 1, 2015		Ending Account Value October 31, 2015		Expenses Paid During Period*		Annualized Expense Ratio*
Class A
Actual	$	1,000	$	974.10	$	4.53		0.91	%
Hypothetical**	$	1,000	$	1,020.62	$	4.63		0.91	%
Class C
Actual	$	1,000	$	970.50	$	8.00		1.61	%
Hypothetical**	$	1,000	$	1,017.09	$	8.19		1.61	%
Advisor Class
Actual	$	1,000	$	975.50	$	3.04		0.61	%
Hypothetical**	$	1,000	$	1,022.13	$	3.11		0.61	%
Class R
Actual	$	1,000	$	973.20	$	5.42		1.09	%
Hypothetical**	$	1,000	$	1,019.71	$	5.55		1.09	%
Class K
Actual	$	1,000	$	974.30	$	4.28		0.86	%
Hypothetical**	$	1,000	$	1,020.87	$	4.38		0.86	%
Class I
Actual	$	1,000	$	975.40	$	2.94		0.59	%
Hypothetical**	$	1,000	$	1,022.23	$	3.01		0.59	%

12 •  AB BOND INFLATION STRATEGY

Expense Example

	Beginning Account Value May 1, 2015		Ending Account Value October 31, 2015		Expenses Paid During Period*		Annualized Expense Ratio*
Class 1
Actual	$	1,000	$	974.90	$	3.53		0.71	%
Hypothetical**	$	1,000	$	1,021.63	$	3.62		0.71	%
Class 2
Actual	$	1,000	$	975.50	$	3.04		0.61	%
Hypothetical**	$	1,000	$	1,022.13	$	3.11		0.61	%
Class Z
Actual	$	1,000	$	976.60	$	3.09		0.62	%
Hypothetical**	$	1,000	$	1,022.08	$	3.16		0.62	%

* Expenses are equal to each classes’ annualized expense ratios, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).

** Assumes 5% annual return before expenses.

AB BOND INFLATION STRATEGY  • 13

Expense Example

PORTFOLIO SUMMARY

October 31, 2015 (unaudited)

PORTFOLIO STATISTICS

Net Assets ($mil): $334.7

Total Investments ($mil): $436.9

INFLATION PROTECTION BREAKDOWN*
U.S. Inflation-Protected Exposure	98.4	%
Non-U.S.	—
Non-Inflation Exposure	1.6	%
	100	%

SECTOR BREAKDOWN OF NET PORTFOLIO ASSETS, EXCLUDING TREASURY SECURITIES, TIPS, INTEREST RATE DERIVATIVES AND NET CASH EQUIVALENTS*
Corporates – Investment Grade	14.5	%
Asset-Backed Securities	11.4	%
Commercial Mortgage-Backed Securities	10.2	%
Collateralized Mortgage Obligations	3.1	%
Quasi-Sovereigns	0.6	%
Corporates – Non-Investment Grade	0.6	%
Governments – Sovereign Agencies	0.5	%
Governments – Sovereign Bonds	0.2	%
Common Stocks	0.2	%
Emerging Markets – Corporate Bonds	0.1	%

SECTOR BREAKDOWN OF TOTAL PORTFOLIO INVESTMENTS, EXCLUDING DERIVATIVES†
Inflation-Linked Securities	60.1	%
Corporates – Investment Grade	14.5	%
Asset-Backed Securities	8.8	%
Commercial Mortgage-Backed Securities	7.8	%
Corporates – Non-Investment Grade	2.5	%
Collateralized Mortgage Obligations	2.4	%
Quasi-Sovereigns	0.5	%
Governments – Sovereign Agencies	0.4	%
Governments – Treasuries	0.3	%
Governments – Sovereign Bonds	0.1	%
Common Stocks	0.1	%
Emerging Markets – Corporate Bonds	0.0	%
Short-Term	2.5	%

14 •  AB BOND INFLATION STRATEGY

Portfolio Summary

PORTFOLIO SUMMARY

October 31, 2015 (unaudited)

* All data are as of October 31, 2015. The Strategy’s sector and inflation protection exposure breakdowns are expressed as an approximate percentage of the Strategy’s total net assets (and may vary over time) inclusive of derivative exposure except as noted, based on the Adviser’s internal classification.

^†  The Strategy’s sector breakdown is expressed, based on the Adviser’s internal classification, as a percentage of total investments and may vary over time. The Strategy also enters into derivative transactions (not reflected in the table), which may be used for hedging or investment purposes or to adjust the risk profile or exposures of the Strategy (see “Portfolio of Investments” section of the report for additional details). Derivative transactions may result in a form of leverage for the Strategy. The Strategy uses leverage for investment purposes by entering into reverse repurchase agreements. As a result, the Strategy’s total investments will generally exceed its net assets.

AB BOND INFLATION STRATEGY  • 15

Portfolio Summary

PORTFOLIO OF INVESTMENTS

October 31, 2015

		Principal Amount (000)		U.S. $ Value
INFLATION-LINKED SECURITIES – 78.5%
United States – 78.5%
U.S. Treasury Inflation Index 0.125%, 4/15/17-7/15/24 (TIPS)(a)	U.S.$		173,215	$	170,868,726
0.125%, 1/15/22 (TIPS)(b)			11,510		11,237,208
0.25%, 1/15/25 (TIPS)(a)			31,576		30,338,624
0.375%, 7/15/23 (TIPS)(a)			19,910		19,610,885
0.375%, 7/15/25 (TIPS)			12,446		12,139,194
0.625%, 1/15/24 (TIPS)			14,179		14,148,941
1.625%, 1/15/18 (TIPS)			4,263		4,416,851
Total Inflation-Linked Securities (cost $268,364,626)					262,760,429
CORPORATES – INVESTMENT GRADE – 18.8%
Industrial – 12.5%
Basic – 1.2%
Barrick Gold Corp. 4.10%, 5/01/23			147		136,540
Dow Chemical Co. (The) 8.55%, 5/15/19			67		80,578
Eastman Chemical Co. 3.80%, 3/15/25			300		298,385
Freeport-McMoran Oil & Gas LLC/FCX Oil & Gas, Inc. 6.50%, 11/15/20			124		112,375
Glencore Funding LLC 3.125%, 4/29/19(c)			1,720		1,474,900
International Paper Co. 4.75%, 2/15/22			660		708,560
LyondellBasell Industries NV 5.75%, 4/15/24			405		458,691
Minsur SA 6.25%, 2/07/24(c)			314		329,832
Sociedad Quimica y Minera de Chile SA 3.625%, 4/03/23(c)			393		334,050
					3,933,911
Capital Goods – 0.3%
Odebrecht Finance Ltd. 5.25%, 6/27/29(c)			426		246,547
Yamana Gold, Inc. 4.95%, 7/15/24			853		782,638
					1,029,185
Communications - Media – 1.6%
21st Century Fox America, Inc. 3.00%, 9/15/22			1,095		1,086,825
6.15%, 3/01/37-2/15/41			331		382,987

16 •  AB BOND INFLATION STRATEGY

Portfolio of Investments

			Principal Amount (000)		U.S. $ Value
CBS Corp. 3.50%, 1/15/25	U.S.$			300	$	292,342
5.75%, 4/15/20				325		364,234
Cox Communications, Inc. 2.95%, 6/30/23(c)				163		146,745
Discovery Communications LLC 3.45%, 3/15/25				323		301,520
McGraw Hill Financial, Inc. 4.40%, 2/15/26(c)				611		625,371
NBCUniversal Enterprise, Inc. 5.25%, 3/19/21(c)(d)				409		435,585
RELX Capital, Inc. 8.625%, 1/15/19				460		544,661
Time Warner Cable, Inc. 4.50%, 9/15/42				235		190,343
5.00%, 2/01/20				35		37,447
8.75%, 2/14/19				25		29,305
Time Warner, Inc. 3.55%, 6/01/24				537		534,726
Viacom, Inc. 3.875%, 4/01/24				339		321,484
						5,293,575
Communications - Telecommunications – 1.6%
American Tower Corp. 3.50%, 1/31/23				300		290,669
4.70%, 3/15/22				395		414,760
5.05%, 9/01/20				35		38,047
AT&T, Inc. 3.00%, 2/15/22				1,255		1,238,745
DIRECTV Holdings LLC/DIRECTV Financing Co., Inc. 3.80%, 3/15/22				274		280,553
4.45%, 4/01/24				372		383,589
5.00%, 3/01/21				825		901,882
Rogers Communications, Inc. 4.00%, 6/06/22		CAD		55		44,232
Telefonica Emisiones SAU 5.462%, 2/16/21		U.S.$		400		446,392
Verizon Communications, Inc. 4.272%, 1/15/36				1,157		1,060,477
7.35%, 4/01/39				300		383,343
						5,482,689
Consumer Cyclical - Automotive – 0.5%
Ford Motor Credit Co. LLC 2.597%, 11/04/19				400		396,010
5.875%, 8/02/21				640		729,522
General Motors Co. 3.50%, 10/02/18				425		432,059
						1,557,591

AB BOND INFLATION STRATEGY  • 17

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Consumer Cyclical - Retailers – 0.8%
CVS Health Corp. 3.875%, 7/20/25	U.S.$		695	$	714,840
Kohl’s Corp. 4.25%, 7/17/25			876		869,303
Walgreens Boots Alliance, Inc. 3.80%, 11/18/24			935		927,992
					2,512,135
Consumer Non-Cyclical – 3.5%
AbbVie, Inc. 3.60%, 5/14/25			455		447,278
Actavis Funding SCS 3.80%, 3/15/25			803		795,723
3.85%, 6/15/24			278		276,635
Agilent Technologies, Inc. 5.00%, 7/15/20			7		7,523
Altria Group, Inc. 2.625%, 1/14/20			930		938,756
4.75%, 5/05/21			195		214,704
Baxalta, Inc. 3.60%, 6/23/22(c)			700		708,505
Bayer US Finance LLC 3.375%, 10/08/24(c)			374		376,575
Becton Dickinson and Co. 3.734%, 12/15/24			388		396,984
Biogen, Inc. 3.625%, 9/15/22			436		443,293
Bunge Ltd. Finance Corp. 8.50%, 6/15/19			81		95,792
Celgene Corp. 3.875%, 8/15/25			520		521,370
Gilead Sciences, Inc. 3.65%, 3/01/26			675		682,430
Grupo Bimbo SAB de CV 3.875%, 6/27/24(c)			648		638,779
Kraft Heinz Foods Co. 2.80%, 7/02/20(c)			350		351,361
3.50%, 7/15/22(c)			447		455,553
Kroger Co. (The) 3.40%, 4/15/22			624		636,366
Laboratory Corp. of America Holdings 3.60%, 2/01/25			275		267,662
Medtronic, Inc. 3.50%, 3/15/25			895		916,476
Perrigo Finance PLC 3.50%, 12/15/21			217		212,322
3.90%, 12/15/24			310		298,333

18 •  AB BOND INFLATION STRATEGY

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Reynolds American, Inc. 3.25%, 11/01/22	U.S.$		284	$	282,567
4.00%, 6/12/22			611		640,472
Thermo Fisher Scientific, Inc. 4.15%, 2/01/24			363		379,457
Tyson Foods, Inc. 2.65%, 8/15/19			199		200,557
3.95%, 8/15/24			650		663,595
					11,849,068
Energy – 2.2%
Diamond Offshore Drilling, Inc. 4.875%, 11/01/43			350		246,512
Energy Transfer Partners LP 5.20%, 2/01/22			510		507,430
6.125%, 2/15/17			145		151,529
EnLink Midstream Partners LP 5.05%, 4/01/45			352		283,873
Enterprise Products Operating LLC 3.70%, 2/15/26			771		732,831
5.20%, 9/01/20			335		368,291
Kinder Morgan Energy Partners LP 3.95%, 9/01/22			846		787,436
4.15%, 3/01/22			104		99,135
Marathon Petroleum Corp. 5.125%, 3/01/21			280		305,465
Noble Energy, Inc. 3.90%, 11/15/24			491		467,372
4.15%, 12/15/21			127		128,450
8.25%, 3/01/19			387		450,812
Plains All American Pipeline LP/PAA Finance Corp. 3.60%, 11/01/24			621		579,983
Regency Energy Partners LP/Regency Energy Finance Corp. 4.50%, 11/01/23			115		105,548
Reliance Holding USA, Inc. 5.40%, 2/14/22(c)			1,060		1,161,861
Spectra Energy Capital LLC 8.00%, 10/01/19			8		9,195
Valero Energy Corp. 6.125%, 2/01/20			476		538,684
Williams Partners LP 3.90%, 1/15/25			350		297,481
4.125%, 11/15/20			300		299,437
					7,521,325
Other Industrial – 0.1%
Hutchison Whampoa International 14 Ltd. 1.625%, 10/31/17(c)			356		355,037

AB BOND INFLATION STRATEGY  • 19

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Technology – 0.7%
KLA-Tencor Corp. 4.65%, 11/01/24	U.S.$		639	$	643,444
Motorola Solutions, Inc. 7.50%, 5/15/25			505		572,260
Seagate HDD Cayman 4.75%, 1/01/25			398		357,456
Tencent Holdings Ltd. 3.375%, 5/02/19(c)			426		435,109
Total System Services, Inc. 2.375%, 6/01/18			259		258,837
					2,267,106
					41,801,622
Financial Institutions – 5.5%
Banking – 3.2%
ABN AMRO Bank NV 4.75%, 7/28/25(c)			150		151,258
Bank of America Corp. Series E 0.80%, 3/28/18(e)	EUR		900		980,729
Barclays Bank PLC 6.625%, 3/30/22(c)			101		140,359
Barclays PLC 3.65%, 3/16/25	U.S.$		294		284,334
BPCE SA 5.70%, 10/22/23(c)			213		228,037
Capital One Financial Corp. 5.25%, 2/21/17			150		156,937
Citigroup, Inc. 3.875%, 3/26/25			655		637,051
Cooperatieve Centrale Raiffeisen-Boerenleenbank BA/Netherlands 4.375%, 8/04/25			396		404,022
Credit Suisse Group Funding Guernsey Ltd. 3.75%, 3/26/25(c)			895		875,023
Goldman Sachs Group, Inc. (The) 1.925%, 11/29/23(e)			810		811,847
JPMorgan Chase & Co. 4.25%, 10/15/20			55		58,907
Mizuho Financial Group Cayman 3 Ltd. 4.60%, 3/27/24(c)			816		836,947
Morgan Stanley Series G 4.00%, 7/23/25			171		175,848
5.50%, 7/28/21			456		516,153
Murray Street Investment Trust I 4.647%, 3/09/17			52		54,068

20 •  AB BOND INFLATION STRATEGY

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
PNC Bank NA 3.80%, 7/25/23	U.S.$		940	$	972,937
Rabobank Capital Funding Trust III 5.254%, 10/21/16(c)(d)			375		381,975
Santander Bank NA 1.251%, 1/12/18(e)			890		884,896
Santander UK PLC 5.00%, 11/07/23(c)			505		526,674
Standard Chartered PLC Series E 4.00%, 7/12/22(c)			725		735,309
UBS AG/Stamford CT 7.625%, 8/17/22			465		537,810
UBS Group Funding Jersey Ltd. 4.125%, 9/24/25(c)			453		454,589
					10,805,710
Brokerage – 0.3%
Nomura Holdings, Inc. 2.00%, 9/13/16			809		813,827
Insurance – 1.4%
American International Group, Inc. 4.875%, 6/01/22			625		695,056
6.40%, 12/15/20			205		242,060
Coventry Health Care, Inc. 5.45%, 6/15/21			415		462,235
Dai-ichi Life Insurance Co., Ltd. (The) 5.10%, 10/28/24(c)(d)			415		430,562
Hartford Financial Services Group, Inc. (The) 5.125%, 4/15/22			535		592,048
5.50%, 3/30/20			24		26,821
6.10%, 10/01/41			165		197,727
Lincoln National Corp. 8.75%, 7/01/19			175		213,917
MetLife, Inc. 5.70%, 6/15/35			90		106,223
7.717%, 2/15/19			180		211,758
Series C 5.25%, 6/15/20(d)			673		679,309
Nationwide Financial Services, Inc. 5.375%, 3/25/21(c)			360		400,172
Nationwide Mutual Insurance Co. 9.375%, 8/15/39(c)			125		188,965
Prudential Financial, Inc. 5.625%, 6/15/43			340		355,810
					4,802,663

AB BOND INFLATION STRATEGY  • 21

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
REITS – 0.6%
Host Hotels & Resorts LP 5.25%, 3/15/22	U.S.$		175	$	187,916
Trust F/1401 5.25%, 12/15/24(c)			825		853,875
Welltower, Inc. 5.25%, 1/15/22			890		968,337
					2,010,128
					18,432,328
Utility – 0.8%
Electric – 0.7%
Berkshire Hathaway Energy Co. 6.125%, 4/01/36			340		408,171
CMS Energy Corp. 5.05%, 3/15/22			144		159,775
Constellation Energy Group, Inc. 5.15%, 12/01/20			91		99,472
Entergy Corp. 4.00%, 7/15/22			607		623,829
Exelon Corp. 2.85%, 6/15/20			570		570,454
Exelon Generation Co. LLC 4.25%, 6/15/22			416		423,901
					2,285,602
Natural Gas – 0.1%
NiSource Finance Corp. 6.80%, 1/15/19			75		85,274
Talent Yield Investments Ltd. 4.50%, 4/25/22(c)			480		500,485
					585,759
					2,871,361
Total Corporates – Investment Grade (cost $63,485,995)					63,105,311
ASSET-BACKED SECURITIES – 11.4%
Autos - Fixed Rate – 6.5%
Ally Auto Receivables Trust Series 2015-2, Class A3 1.49%, 11/15/19			341		341,290
Ally Master Owner Trust Series 2015-3, Class A 1.63%, 5/15/20			707		705,871
AmeriCredit Automobile Receivables Trust Series 2013-3, Class A3 0.92%, 4/09/18			558		558,354
Series 2013-4, Class A3 0.96%, 4/09/18			283		283,018
ARI Fleet Lease Trust Series 2014-A, Class A2 0.81%, 11/15/22(c)			248		248,256

22 •  AB BOND INFLATION STRATEGY

Portfolio of Investments

		Principal Amount (000)			U.S. $ Value
Avis Budget Rental Car Funding AESOP LLC Series 2012-3A, Class A 2.10%, 3/20/19(c)	U.S.$		420		$	422,210
Series 2013-2A, Class A 2.97%, 2/20/20(c)			289			290,311
Series 2014-1A, Class A 2.46%, 7/20/20(c)			1,689			1,711,966
Bank of The West Auto Trust Series 2015-1, Class A3 1.31%, 10/15/19(c)			706			706,815
California Republic Auto Receivables Trust Series 2014-2, Class A4 1.57%, 12/16/19			850			849,363
Series 2015-2, Class A3 1.31%, 8/15/19			530			526,669
Capital Auto Receivables Asset Trust Series 2014-1, Class B 2.22%, 1/22/19			200			201,422
CPS Auto Receivables Trust Series 2013-B, Class A 1.82%, 9/15/20(c)			376			376,079
Series 2014-B, Class A 1.11%, 11/15/18(c)			332			331,456
Drive Auto Receivables Trust Series 2015-BA, Class A2A 0.93%, 12/15/17(c)			275			274,479
Series 2015-CA, Class A2A 1.03%, 2/15/18(c)			398			397,939
Series 2015-DA, Class A2A 1.23%, 6/15/18(c)			510			509,973
Enterprise Fleet Financing LLC Series 2014-1, Class A2 0.87%, 9/20/19(c)			252			252,046
Series 2015-1, Class A2 1.30%, 9/20/20(c)			720			719,010
Exeter Automobile Receivables Trust Series 2013-1A, Class A 1.29%, 10/16/17(c)			– 0	–**		373
Series 2014-1A, Class A 1.29%, 5/15/18(c)			97			97,469
Series 2014-2A, Class A 1.06%, 8/15/18(c)			125			124,782
Flagship Credit Auto Trust Series 2013-1, Class A 1.32%, 4/16/18(c)			46			45,861
Ford Credit Auto Owner Trust Series 2012-D, Class B 1.01%, 5/15/18			225			224,318
Series 2014-2, Class A 2.31%, 4/15/26(c)			728			732,631

AB BOND INFLATION STRATEGY  • 23

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
GM Financial Automobile Leasing Trust Series 2015-1, Class A2 1.10%, 12/20/17	U.S.$		673	$	674,666
Series 2015-2, Class A3 1.68%, 12/20/18			798		797,869
GMF Floorplan Owner Revolving Trust Series 2015-1, Class A1 1.65%, 5/15/20(c)			599		596,667
Harley-Davidson Motorcycle Trust Series 2014-1, Class A3 1.10%, 9/15/19			415		414,210
Hertz Vehicle Financing II LP Series 2015-2A, Class A 2.02%, 9/25/19(c)			508		506,564
Hertz Vehicle Financing LLC Series 2013-1A, Class A1 1.12%, 8/25/17(c)			2,185		2,181,164
Series 2013-1A, Class B2 2.48%, 8/25/19(c)			368		354,725
Hyundai Auto Lease Securitization Trust Series 2015-A, Class A2 1.00%, 10/16/17(c)			495		495,193
Series 2015-B, Class A3 1.40%, 11/15/18(c)			557		558,292
Hyundai Auto Receivables Trust Series 2012-B, Class C 1.95%, 10/15/18			165		165,492
Mercedes Benz Auto Lease Trust Series 2015-B, Class A3 1.34%, 7/16/18			318		317,988
Mercedes-Benz Master Owner Trust Series 2012-AA, Class A 0.79%, 11/15/17(c)			1,193		1,193,060
Nissan Auto Lease Trust Series 2015-A, Class A3 1.40%, 6/15/18			587		589,540
Santander Drive Auto Receivables Trust Series 2013-4, Class A3 1.11%, 12/15/17			65		65,012
Series 2015-3, Class A2A 1.02%, 9/17/18			601		601,107
Series 2015-4,Class A2A 1.20%, 12/17/18			335		334,725
TCF Auto Receivables Owner Trust Series 2015-1A, Class A2 1.02%, 8/15/18(c)			804		803,266
Westlake Automobile Receivables Trust Series 2015-3A, Class A2A 1.42%, 5/17/21(c)			286		285,906
					21,867,407

24 •  AB BOND INFLATION STRATEGY

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Credit Cards - Fixed Rate – 1.9%
American Express Credit Account Master Trust Series 2014-2, Class A 1.26%, 1/15/20	U.S.$		474	$	475,674
Barclays Dryrock Issuance Trust Series 2014-3, Class A 2.41%, 7/15/22			523		536,927
Series 2015-2, Class A 1.56%, 3/15/21			728		732,778
Capital One Multi-Asset Execution Trust Series 2015-A5, Class A5 1.60%, 5/17/21			692		694,063
Chase Issuance Trust Series 2014-A1, Class A1 1.15%, 1/15/19			825		827,525
Discover Card Execution Note Trust Series 2015-A2, Class A 1.90%, 10/17/22			718		717,268
Synchrony Credit Card Master Note Trust Series 2012-2, Class A 2.22%, 1/15/22			1,084		1,098,377
World Financial Network Credit Card Master Trust Series 2012-B, Class A 1.76%, 5/17/21			370		372,200
Series 2013-A, Class A 1.61%, 12/15/21			373		373,713
Series 2015-B,Class A 2.55%, 6/17/24			551		557,133
					6,385,658
Autos - Floating Rate – 1.2%
BMW Floorplan Master Owner Trust Series 2015-1A, Class A 0.696%, 7/15/20(c)(e)			1,037		1,031,860
Ford Credit Floorplan Master Owner Trust A Series 2015-2, Class A2 0.766%, 1/15/22(e)			692		685,366
GE Dealer Floorplan Master Note Trust Series 2014-1, Class A 0.574%, 7/20/19(e)			534		531,047
Series 2015-1, Class A 0.694%, 1/20/20(e)			620		615,495
Hertz Fleet Lease Funding LP Series 2013-3, Class A 0.747%, 12/10/27(c)(e)			760		760,523
Volkswagen Credit Auto Master Trust Series 2014-1A, Class A1 0.544%, 7/22/19(c)(e)			330		325,931
					3,950,222

AB BOND INFLATION STRATEGY  • 25

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Credit Cards - Floating Rate – 0.9%
Cabela’s Credit Card Master Note Trust Series 2014-1, Class A 0.546%, 3/16/20(e)	U.S.$		600	$	599,112
Discover Card Execution Note Trust Series 2015-A1, Class A1 0.546%, 8/17/20(e)			501		499,379
First National Master Note Trust Series 2013-2, Class A 0.726%, 10/15/19(e)			794		794,230
World Financial Network Credit Card Master Trust Series 2014-A, Class A 0.576%, 12/15/19(e)			910		910,307
Series 2015-A, Class A 0.676%, 2/15/22(e)			403		401,551
					3,204,579
Other ABS - Fixed Rate – 0.9%
CIT Equipment Collateral Series 2014-VT1, Class A2 0.86%, 5/22/17(c)			845		845,576
CNH Equipment Trust Series 2015-A, Class A4 1.85%, 4/15/21			493		493,712
Dell Equipment Finance Trust Series 2015-1, Class A3 1.30%, 3/23/20(c)			247		245,760
Series 2015-2, Class A2A 1.42%, 12/22/17(c)			286		285,987
GE Equipment Small Ticket LLC Series 2014-1A, Class A2 0.59%, 8/24/16(c)			177		176,527
SBA Tower Trust 3.156%, 10/15/20(c)			851		850,660
					2,898,222
Total Asset-Backed Securities (cost $38,270,730)					38,306,088
COMMERCIAL MORTGAGE-BACKED SECURITIES – 10.2%
Non-Agency Fixed Rate CMBS – 8.6%
Banc of America Commercial Mortgage Trust Series 2007-4, Class A1A 5.774%, 2/10/51			1,705		1,797,358
Series 2007-5, Class AM 5.772%, 2/10/51			258		270,040

26 •  AB BOND INFLATION STRATEGY

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Bear Stearns Commercial Mortgage Securities Trust Series 2006-PW13, Class AJ 5.611%, 9/11/41	U.S.$		571	$	575,207
BHMS Mortgage Trust Series 2014-ATLS, Class AFX 3.601%, 7/05/33(c)			1,070		1,091,484
CGRBS Commercial Mortgage Trust Series 2013-VN05, Class A 3.369%, 3/13/35(c)			885		904,654
Citigroup Commercial Mortgage Trust Series 2006-C4, Class A1A 5.792%, 3/15/49			209		211,885
Series 2013-GC11, Class D 4.457%, 4/10/46(c)			420		391,410
Series 2015-GC27, Class A5 3.137%, 2/10/48			707		702,432
COBALT CMBS Commercial Mortgage Trust Series 2007-C3, Class A4 5.766%, 5/15/46			454		479,655
Commercial Mortgage Trust Series 2006-C8, Class A1A 5.292%, 12/10/46			659		680,294
Series 2007-GG9, Class A4 5.444%, 3/10/39			561		581,114
Series 2007-GG9, Class AM 5.475%, 3/10/39			598		619,123
Series 2013-SFS, Class A1 1.873%, 4/12/35(c)			361		354,227
Credit Suisse Commercial Mortgage Trust Series 2007-C3, Class AM 5.699%, 6/15/39			463		473,492
CSAIL Commercial Mortgage Trust Series 2015-C3, Class A4 3.718%, 8/15/48			631		656,146
DBUBS Mortgage Trust Series 2011-LC1A, Class E 5.607%, 11/10/46(c)			368		391,803
Extended Stay America Trust Series 2013-ESH7, Class A17 2.295%, 12/05/31(c)			515		513,636
GS Mortgage Securities Corp. II Series 2013-KING, Class A 2.706%, 12/10/27(c)			784		797,294
GS Mortgage Securities Trust Series 2007-GG10, Class A4 5.795%, 8/10/45			550		575,267
Series 2013-G1, Class A1 2.059%, 4/10/31(c)			644		631,994

AB BOND INFLATION STRATEGY  • 27

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
JP Morgan Chase Commercial Mortgage Securities Trust Series 2004-LN2, Class A1A 4.838%, 7/15/41(c)	U.S.$		252	$	251,484
Series 2006-CB15, Class A4 5.814%, 6/12/43			424		428,932
Series 2006-LDP9, Class AM 5.372%, 5/15/47			370		378,139
Series 2007-CB19, Class AM 5.695%, 2/12/49			295		309,555
Series 2007-LD12, Class AM 6.009%, 2/15/51			245		260,353
Series 2007-LDPX, Class A1A 5.439%, 1/15/49			1,890		1,965,895
Series 2007-LDPX, Class A3 5.42%, 1/15/49			405		418,268
Series 2008-C2, Class A1A 5.998%, 2/12/51			840		899,445
Series 2010-C2, Class A1 2.749%, 11/15/43(c)			84		84,386
Series 2011-C5, Class D 5.323%, 8/15/46(c)			266		276,739
Series 2015-C32, Class C 4.819%, 11/15/48			545		503,156
JPMBB Commercial Mortgage Securities Trust Series 2015-C31, Class A3 3.801%, 8/15/48			670		700,692
LB-UBS Commercial Mortgage Trust Series 2006-C1, Class A4 5.156%, 2/15/31			494		493,969
Series 2007-C1, Class A4 5.424%, 2/15/40			1,045		1,075,922
Series 2007-C1, Class AM 5.455%, 2/15/40			290		301,171
LSTAR Commercial Mortgage Trust Series 2014-2, Class A2 2.767%, 1/20/41(c)			625		635,716
Series 2015-3, Class A2 2.729%, 4/20/48(c)			698		701,456
Merrill Lynch Mortgage Trust Series 2006-C2, Class A1A 5.739%, 8/12/43			568		581,227
Merrill Lynch/Countrywide Commercial Mortgage Trust Series 2006-4, Class A1A 5.166%, 12/12/49			998		1,028,584
Series 2007-9, Class A4 5.70%, 9/12/49			125		130,394

28 •  AB BOND INFLATION STRATEGY

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
UBS-Barclays Commercial Mortgage Trust Series 2012-C3, Class A4 3.091%, 8/10/49	U.S.$		277	$	282,655
Series 2012-C4, Class A5 2.85%, 12/10/45			2,309		2,297,412
Wachovia Bank Commercial Mortgage Trust Series 2006-C26, Class A1A 6.009%, 6/15/45			401		408,420
WF-RBS Commercial Mortgage Trust Series 2012-C9, Class D 4.803%, 11/15/45(c)			344		167,613
Series 2013-C14, Class A5 3.337%, 6/15/46			862		885,252
Series 2014-C20, Class A2 3.036%, 5/15/47			648		669,905
					28,835,255
Non-Agency Floating Rate CMBS – 1.6%
Carefree Portfolio Trust Series 2014-CARE, Class A 1.516%, 11/15/19(c)(e)			489		489,009
Commercial Mortgage Trust Series 2014-KYO, Class A 1.096%, 6/11/27(c)(e)			775		770,076
Series 2014-SAVA, Class A 1.346%, 6/15/34(c)(e)			540		537,876
H/2 Asset Funding NRE Series 2015-1A 1.844%, 6/24/49(c)(e)			662		660,474
JP Morgan Chase Commercial Mortgage Securities Trust Series 2014-INN, Class A 1.116%, 6/15/29(c)(e)			1,068		1,060,987
PFP III Ltd. Series 2014-1, Class A 1.367%, 6/14/31(c)(e)			247		245,960
Resource Capital Corp., Ltd. Series 2014-CRE2, Class A 1.247%, 4/15/32(c)(e)			449		447,053
Starwood Retail Property Trust Series 2014-STAR, Class A 1.416%, 11/15/27(c)(e)			614		609,238
Wells Fargo Commercial Mortgage Trust Series 2015-SG1, Class C 4.471%, 12/15/47(f)			537		512,339
					5,333,012
Total Commercial Mortgage-Backed Securities (cost $34,713,804)					34,168,267

AB BOND INFLATION STRATEGY  • 29

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
COLLATERALIZED MORTGAGE OBLIGATIONS – 3.1%
GSE Risk Share Floating Rate – 2.8%
Bellemeade Re Ltd. Series 2015-1A, Class M1 2.689%, 7/25/25(c)(e)	U.S.$		495	$	494,665
Federal Home Loan Mortgage Corp. Structured Agency Credit Risk Debt Notes Series 2013-DN2, Class M2 4.447%, 11/25/23(e)			1,030		1,024,818
Series 2014-DN3, Class M3 4.197%, 8/25/24(e)			1,055		1,017,270
Series 2015-DNA1, Class M3 3.497%, 10/25/27(e)			260		245,327
Series 2015-DNA2, Class M2 2.797%, 12/25/27(e)			1,046		1,043,886
Series 2015-HQ1, Class M2 2.397%, 3/25/25(e)			410		406,588
Series 2015-HQA1, Class M2 2.844%, 3/25/28(e)			770		766,958
Federal National Mortgage Association Connecticut Avenue Securities Series 2014-C03, Class 1M1 1.397%, 7/25/24(e)			278		277,318
Series 2014-C04, Class 1M2 5.097%, 11/25/24(e)			528		529,482
Series 2014-C04, Class 2M2 5.197%, 11/25/24(e)			195		195,966
Series 2015-C01, Class 1M2 4.497%, 2/25/25(e)			450		436,078
Series 2015-C02, Class 2M2 4.197%, 5/25/25(e)			445		422,992
Series 2015-C03, Class 1M2 5.197%, 7/25/25(e)			691		687,911
Series 2015-C03, Class 2M2 5.197%, 7/25/25(e)			679		678,478
Series 2015-C04, Class 1M2 5.894%, 4/25/28(e)			204		207,548
Series 2015-C04, Class 2M2 5.744%, 4/25/28(e)			314		318,238
Wells Fargo Credit Risk Transfer Securities Trust Series 2015-WF1, Class 1M1 2.947%, 11/25/25(c)(e)			250		249,791
Series 2015-WF1, Class 2M1 3.047%, 11/25/25(c)(e)			303		303,545
					9,306,859

30 •  AB BOND INFLATION STRATEGY

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Non-Agency Floating Rate – 0.2%
JP Morgan Chase Commercial Mortgage Securities Trust Series 2015-SGP, Class A 1.896%, 7/15/36(c)(e)	U.S.$		853	$	852,260
Agency Fixed Rate – 0.1%
Federal National Mortgage Association REMICS Series 2010-117, Class DI 4.50%, 5/25/25(g)			2,358		251,379
Total Collateralized Mortgage Obligations (cost $10,509,012)					10,410,498
CORPORATES – NON-INVESTMENT GRADE – 3.1%
Industrial – 1.5%
Basic – 0.2%
Novelis, Inc. 8.375%, 12/15/17			90		90,675
Teck Resources Ltd. 4.50%, 1/15/21			785		533,800
					624,475
Capital Goods – 0.1%
Sealed Air Corp. 5.25%, 4/01/23(c)			331		345,895
Communications - Media – 0.0%
CSC Holdings LLC 8.625%, 2/15/19			146		155,125
Communications - Telecommunications – 0.4%
Numericable-SFR SAS 5.375%, 5/15/22(c)	EUR		231		262,910
Sprint Capital Corp. 6.90%, 5/01/19	U.S.$		1,000		960,000
					1,222,910
Consumer Cyclical - Automotive – 0.1%
Dana Holding Corp. 6.00%, 9/15/23			147		152,145
Goodyear Tire & Rubber Co. (The) 8.25%, 8/15/20			190		198,740
					350,885
Consumer Cyclical - Other – 0.2%
KB Home 4.75%, 5/15/19			345		339,271
MCE Finance Ltd. 5.00%, 2/15/21(c)			405		379,688
					718,959

AB BOND INFLATION STRATEGY  • 31

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Consumer Non-Cyclical – 0.1%
Valeant Pharmaceuticals International, Inc. 6.125%, 4/15/25(c)	U.S.$		385	$	323,881
Energy – 0.3%
DCP Midstream LLC 4.75%, 9/30/21(c)			405		358,420
ONEOK, Inc. 4.25%, 2/01/22			463		397,023
SM Energy Co. 6.50%, 1/01/23			41		40,401
Transocean, Inc. 6.50%, 11/15/20			370		296,311
					1,092,155
Technology – 0.1%
Advanced Micro Devices, Inc. 6.75%, 3/01/19			280		215,600
					5,049,885
Financial Institutions – 1.4%
Banking – 1.2%
Bank of America Corp. Series Z 6.50%, 10/23/24(d)			233		243,487
Barclays Bank PLC 6.86%, 6/15/32(c)(d)			137		156,865
7.75%, 4/10/23			372		404,085
BNP Paribas SA 7.375%, 8/19/25(c)(d)			345		357,075
Credit Agricole SA 7.875%, 1/23/24(c)(d)			248		254,200
HBOS Capital Funding LP 4.939%, 5/23/16(d)	EUR		951		1,056,225
Intesa Sanpaolo SpA 5.017%, 6/26/24(c)	U.S.$		689		690,111
Royal Bank of Scotland PLC (The) 9.50%, 3/16/22(c)			102		111,279
Societe Generale SA 5.922%, 4/05/17(c)(d)			115		117,229
8.00%, 9/29/25(c)(d)			340		344,799
UniCredit Luxembourg Finance SA 6.00%, 10/31/17(c)			325		342,047
					4,077,402
Finance – 0.2%
AerCap Aviation Solutions BV 6.375%, 5/30/17			200		208,500
International Lease Finance Corp. 5.875%, 4/01/19			294		315,441

32 •  AB BOND INFLATION STRATEGY

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Navient Corp. 7.25%, 1/25/22	U.S.$		54	$	53,190
					577,131
					4,654,533
Utility – 0.2%
Electric – 0.2%
AES Corp./VA 7.375%, 7/01/21			377		401,505
NRG Energy, Inc. Series WI 6.25%, 5/01/24			287		256,865
					658,370
Total Corporates – Non-Investment Grade (cost $11,193,760)					10,362,788
GOVERNMENTS – SOVEREIGN AGENCIES – 0.7%
Brazil – 0.2%
Petrobras Global Finance BV 5.75%, 1/20/20			693		591,441
Canada – 0.1%
NOVA Chemicals Corp. 5.25%, 8/01/23(c)			391		400,071
Colombia – 0.1%
Ecopetrol SA 5.875%, 5/28/45			292		237,980
Israel – 0.2%
Israel Electric Corp. Ltd. Series 6 5.00%, 11/12/24(c)			620		643,622
United Kingdom – 0.1%
Royal Bank of Scotland Group PLC 7.50%, 8/10/20(d)			345		357,075
Total Governments – Sovereign Agencies (cost $2,378,805)					2,230,189
QUASI-SOVEREIGNS – 0.6%
Quasi-Sovereign Bonds – 0.6%
Chile – 0.3%
Corp. Nacional del Cobre de Chile 4.50%, 9/16/25(c)			575		570,330
Empresa de Transporte de Pasajeros Metro SA 4.75%, 2/04/24(c)			358		372,827
					943,157

AB BOND INFLATION STRATEGY  • 33

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Malaysia – 0.1%
Petronas Capital Ltd. 5.25%, 8/12/19(c)	U.S.$		310	$	338,153
Mexico – 0.1%
Petroleos Mexicanos 3.50%, 7/18/18			256		260,352
South Korea – 0.1%
Korea National Oil Corp. 3.125%, 4/03/17(c)			450		460,283
Total Quasi-Sovereigns (cost $1,957,551)					2,001,945
GOVERNMENTS – TREASURIES – 0.4%
Brazil – 0.4%
Brazil Notas do Tesouro Nacional Series F 10.00%, 1/01/17 (cost $1,906,526)	BRL		4,905		1,203,727
GOVERNMENTS – SOVEREIGN BONDS – 0.2%
Mexico – 0.1%
Mexico Government International Bond Series E 5.95%, 3/19/19	U.S.$		168		188,916
Qatar – 0.1%
Qatar Government International Bond 4.50%, 1/20/22(c)			360		400,140
Total Governments – Sovereign Bonds (cost $546,600)					589,056
		Shares
COMMON STOCKS – 0.2%
Mt Logan Re Ltd. (Preference Shares)(h)(i) (cost $500,000)			500		530,735
		Principal Amount (000)
EMERGING MARKETS – CORPORATE BONDS – 0.1%
Industrial – 0.1%
Communications - Telecommunications – 0.1%
Comcel Trust via Comunicaciones Celulares SA 6.875%, 2/06/24(c)	U.S.$		208		165,880

34 •  AB BOND INFLATION STRATEGY

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Consumer Non-Cyclical – 0.0%
Virgolino de Oliveira Finance SA 10.50%, 1/28/18(j)(k)	U.S.$		655	$	8,515
Total Emerging Markets – Corporate Bonds (cost $567,947)					174,395
		Shares
PREFERRED STOCKS – 0.0%
Financial Institutions – 0.0%
Insurance – 0.0%
Allstate Corp. (The) 5.10% (cost $52,500)			2,100		54,033
		Principal Amount (000)
SHORT-TERM INVESTMENTS – 3.2%
Governments – Treasuries – 2.5%
Japan – 2.5%
Japan Treasury Discount Bill Series 564 Zero Coupon, 1/25/16 (cost $8,579,832)	JPY		1,020,000		8,452,915
		Shares
Investment Companies – 0.7%
AB Fixed Income Shares, Inc. – Government STIF Portfolio, 0.13%(l)(m) (cost $2,523,731)			2,523,731		2,523,731
Total Short-Term Investments (cost $11,103,563)					10,976,646
Total Investments – 130.5% (cost $445,551,419)					436,874,107
Other assets less liabilities – (30.5)%					(102,171,318	)
Net Assets – 100.0%				$	334,702,789

AB BOND INFLATION STRATEGY  • 35

Portfolio of Investments

FUTURES (see Note D)

Type	Number of Contracts		Expiration Month		Original Value		Value at October 31, 2015		Unrealized Appreciation/ (Depreciation)
Purchased Contracts
10 Year Canadian Bond Futures		31		December 2015	$	3,401,138	$	3,330,912	$	(70,226	)
U.S. T-Note 5 Yr (CBT) Futures		152		December 2015		18,185,941		18,205,564		19,623
U.S. Ultra Bond (CBT) Futures		3		December 2015		492,450		479,250		(13,200	)
Sold Contracts
Euro-BOBL Futures		93		December 2015		13,103,452		13,235,457		(132,005	)
U.S. Long Bond (CBT) Futures		10		December 2015		1,561,634		1,564,375		(2,741	)
U.S. T-Note 10 Yr (CBT) Futures		73		December 2015		9,333,351		9,321,188		12,163
									$	(186,386	)

FORWARD CURRENCY EXCHANGE CONTRACTS (see Note D)

Counterparty	Contracts to Deliver (000)		In Exchange For (000)		Settlement Date		Unrealized Appreciation/ (Depreciation)
BNP Paribas SA		USD         1,637		GBP     1,080		11/10/15	$	27,531
Goldman Sachs Bank USA		USD         1,179		BRL     4,767		11/04/15		56,712
Goldman Sachs Bank USA		BRL         4,767		USD     1,235		11/04/15		(753	)
Goldman Sachs Bank USA		TWD       83,246		USD     2,609		12/04/15		45,770
Goldman Sachs Bank USA		BRL         5,150		USD     1,120		1/04/17		(45,167	)
HSBC Bank USA		GBP         1,126		USD     1,730		11/10/15		(5,052	)
HSBC Bank USA		JPY  1,450,000		USD   12,098		11/16/15		81,007
JPMorgan Chase Bank		JPY     620,000		USD     5,199		3/25/16		45,924
Morgan Stanley Capital Services LLC		USD            851		INR   55,483		12/04/15		(7,257	)
Standard Chartered Bank		BRL         4,767		USD     1,175		11/04/15		(60,841	)
Standard Chartered Bank		USD         1,235		BRL     4,767		11/04/15		753
State Street Bank & Trust Co.		SGD         7,262		USD     5,185		11/06/15		1,887
State Street Bank & Trust Co.		USD            150		CAD        201		11/19/15		3,479
State Street Bank & Trust Co.		EUR         6,876		USD     7,590		12/03/15		26,311
State Street Bank & Trust Co.		USD         4,219		JPY 511,237		12/11/15		19,927
							$	190,231

CURRENCY OPTIONS WRITTEN (see Note D)

Description	Exercise Price		Expiration Date		Contracts (000)		Premiums Received		U.S. $ Value
Call – USD/JPY		119.300		11/04/15		4,260	$	10,075	$	(3,331	)

36 •  AB BOND INFLATION STRATEGY

Portfolio of Investments

CENTRALLY CLEARED CREDIT DEFAULT SWAPS (see Note D)

Clearing Broker/(Exchange) & Referenced Obligation	Fixed Rate (Pay) Receive			Implied Credit Spread at October 31, 2015			Notional Amount (000)		Market Value			Unrealized Appreciation/ (Depreciation)
Buy Contracts
Citigroup Global Markets, Inc./(INTRCONX):
CDX-NAHY Series 21, 5 Year Index, 12/20/18*		(5.00	)%		2.57	%	$	3,955	$	(306,654	)	$	(130,548	)
Morgan Stanley & Co., LLC/(INTRCONX):
CDX-NAHY Series 21, 5 Year Index, 12/20/18*		(5.00	)		2.57			3,168		(245,621	)		(165,592	)
CDX-NAIG Series 23, 5 Year Index, 12/20/19*		(1.00	)		0.72			18,250		(224,078	)		17,211
									$	(776,353	)	$	(278,929	)

* Termination date

CENTRALLY CLEARED INTEREST RATE SWAPS (see Note D)

					Rate Type
Clearing Broker/ (Exchange)	Notional Amount (000)		Termination Date		Payments made by the Fund	Payments received by the Fund	Unrealized Appreciation/ (Depreciation)
Morgan Stanley & Co., LLC/(CME Group)	CAD	17,120		3/10/17	0.973%	3 Month CDOR	$	(32,621	)
Morgan Stanley & Co., LLC/(CME Group)	AUD	22,680		3/11/17	2.140%	3 Month BBSW		(49,930	)
Morgan Stanley & Co., LLC/(CME Group)	$	23,060		5/18/17	0.811%	3 Month LIBOR		(101,095	)
Morgan Stanley & Co., LLC/(CME Group)	CAD	15,500		6/05/17	1.054%	3 Month CDOR		(50,637	)
Morgan Stanley & Co., LLC/(CME Group)	AUD	19,500		6/09/17	2.218%	3 Month BBSW		(69,341	)
Morgan Stanley & Co., LLC/(CME Group)		14,040		10/30/17	1.915%	3 Month BBSW		(878	)
Morgan Stanley & Co., LLC/(CME Group)	$	6,980		10/31/19	3 Month LIBOR	1.747%		118,763
Morgan Stanley & Co., LLC/(CME Group)	GBP	5,640		6/05/20	6 Month LIBOR	1.651%		118,628
Morgan Stanley & Co., LLC/(CME Group)	$	6,420		8/11/20	3 Month LIBOR	1.712%		94,152

AB BOND INFLATION STRATEGY  • 37

Portfolio of Investments

					Rate Type
Clearing Broker/ (Exchange)	Notional Amount (000)		Termination Date		Payments made by the Fund	Payments received by the Fund	Unrealized Appreciation/ (Depreciation)
Morgan Stanley & Co., LLC/(CME Group)	$	2,610		1/14/24	2.980%	3 Month LIBOR	$	(236,850	)
Morgan Stanley & Co., LLC/(CME Group)		2,300		2/14/24	2.889%	3 Month LIBOR		(185,159	)
Morgan Stanley & Co., LLC/(CME Group)		3,280		4/28/24	2.817%	3 Month LIBOR		(229,054	)
Morgan Stanley & Co., LLC/(CME Group)		4,670		5/06/24	2.736%	3 Month LIBOR		(353,416	)
Morgan Stanley & Co., LLC/(CME Group)		1,890		5/29/24	3 Month LIBOR	2.628%		122,662
Morgan Stanley & Co., LLC/(CME Group)		3,330		7/02/24	2.632%	3 Month LIBOR		(209,629	)
Morgan Stanley & Co., LLC/(CME Group)		2,370		7/10/24	2.674%	3 Month LIBOR		(156,470	)
Morgan Stanley & Co., LLC/(CME Group)		1,900		7/18/24	3 Month LIBOR	2.668%		123,241
Morgan Stanley & Co., LLC/(CME Group)		2,810		9/24/24	3 Month LIBOR	2.691%		172,504
Morgan Stanley & Co., LLC/(CME Group)	AUD	3,450		3/11/25	6 Month BBSW	2.973%		23,754
Morgan Stanley & Co., LLC/(CME Group)	NZD	3,560		6/09/25	3 Month BKBM	4.068%		141,429
Morgan Stanley & Co., LLC/(CME Group)	AUD	2,110		6/09/25	6 Month BBSW	3.384%		71,429
Morgan Stanley & Co., LLC/(CME Group)	$	1,160		6/09/25	2.488%	3 Month LIBOR		(56,950	)
Morgan Stanley & Co., LLC/(CME Group)		3,830		8/04/25	2.293%	3 Month LIBOR		(101,273	)
Morgan Stanley & Co., LLC/(CME Group)	GBP	520		6/05/45	2.396%	6 Month LIBOR		(52,172	)
Morgan Stanley & Co., LLC/(CME Group)	$	490		8/06/45	2.692%	3 Month LIBOR		(19,283	)
Morgan Stanley & Co., LLC/(LCH Group)	NZD	30,550		6/09/17	3.368%	3 Month BKBM		(389,578	)
							$	(1,307,774	)

38 •  AB BOND INFLATION STRATEGY

Portfolio of Investments

CREDIT DEFAULT SWAPS (see Note D)

Swap Counterparty & Referenced Obligation	Fixed Rate (Pay) Receive			Implied Credit Spread at October 31, 2015			Notional Amount (000)		Market Value		Upfront Premiums Paid (Received)			Unrealized Appreciation/ (Depreciation)
Buy Contracts
Citibank, NA:
Advanced Micro Devices, Inc., 7.75%, 8/01/20, 3/20/19*		(5.00	)%		9.62	%	$	280	$	34,441	$	16,951		$	17,490
Sprint Communications, Inc., 8.375%, 8/15/17, 6/20/19*		(5.00	)		5.90			534		12,354		(24,740	)		37,094
Sprint Communications, Inc., 8.375%, 8/15/17, 6/20/19*		(5.00	)		5.90			466		10,782		(20,821	)		31,603
Sale Contracts
Bank of America, NA:
CDX-NAIG Series 19, 5 Year Index, 12/20/17*		1.00			0.34			3,200		48,869		1,307			47,562
Credit Suisse International:
Kohl’s Corp., 6.25% 12/15/17, 6/20/19*		1.00			0.96			123		69		(1,212	)		1,281
Kohl’s Corp., 6.25% 12/15/17, 6/20/19*		1.00			0.96			72		40		(633	)		673
Kohl’s Corp., 6.25% 12/15/17, 6/20/19*		1.00			0.96			50		28		(489	)		517
Kohl’s Corp., 6.25% 12/15/17, 6/20/19*		1.00			0.96			49		28		(485	)		513
Deutsche Bank AG:
Anadarko Petroleum Corp., 5.95% 9/15/16, 9/20/17*		1.00			0.57			440		3,823		(5,843	)		9,666
									$	110,434	$	(35,965	)	$	146,399

* Termination date

AB BOND INFLATION STRATEGY  • 39

Portfolio of Investments

INFLATION (CPI) SWAPS (see Note D)

					Rate Type
Swap Counterparty	Notional Amount (000)		Termination Date		Payments made by the Fund	Payments received by the Fund	Unrealized Appreciation/ (Depreciation)
Barclays Bank PLC	$	7,300		1/15/16	CPI#	0.970%	$	95,381
Barclays Bank PLC		2,570		7/15/19	1.370%	CPI#		(4,172	)
Barclays Bank PLC		20,750		7/15/20	1.527%	CPI#		(89,273	)
Barclays Bank PLC		6,950		1/15/21	1.490%	CPI#		(33,709	)
Citibank, NA		7,300		1/15/16	0.945%	CPI#		(93,312	)
Deutsche Bank AG		3,460		7/15/18	1.440%	CPI#		(16,624	)
Deutsche Bank AG		24,000		7/15/21	1.574%	CPI#		(127,407	)
JPMorgan Chase Bank, NA		8,710		1/15/20	1.795%	CPI#		(138,235	)
							$	(407,351	)

# Variable interest rate based on the rate of inflation as determined by the Consumer Price Index (CPI).

INTEREST RATE SWAPS (see Note D)

					Rate Type
Swap Counterparty	Notional Amount (000)		Termination Date		Payments made by the Fund			Payments received by the Fund	Unrealized Appreciation/ (Depreciation)
Morgan Stanley Capital Services LLC	$	1,100		2/21/42		2.813	%	3 Month LIBOR	$	(70,508	)
Morgan Stanley Capital Services LLC		830		3/06/42		2.804	%	3 Month LIBOR		(50,857	)
									$	(121,365	)

REVERSE REPURCHASE AGREEMENTS (see Note D)

Broker	Interest Rate			Maturity		U.S. $ Value at October 31, 2015
Bank of America		0.15	%		1/25/16	$	19,236,767
Bank of America†		0.15	%		—		5,265,234
Barclays Capital, Inc.†		0.21	%		—		2,401,540
HSBC Bank USA		0.40	%		1/14/16		20,978,962
HSBC Bank USA		0.45	%		1/25/16		25,846,980
HSBC Bank USA		0.45	%		1/26/16		10,035,440
JPMorgan Chase Bank		0.37	%		1/13/16		14,027,970
JPMorgan Chase Bank		0.38	%		1/14/16		15,582,796
						$	113,375,689

† The reverse repurchase agreement matures on demand. Interest rate resets daily and the rate shown is the rate in effect on October 31, 2015

40 •  AB BOND INFLATION STRATEGY

Portfolio of Investments

The type of underlying collateral and the remaining maturity of open reverse repurchase agreements in relation to the reverse repurchase agreements on the Statements of Assets and Liabilities is as follows:

Reverse Repurchase Agreements

	Overnight and Continuous		Up to 30 Days			31-90 Days		Greater than 90 Days			Total
Inflation-Linked Securities	$	7,666,774	$	– 0	–	$	105,708,915	$	– 0	–	$	113,375,689
Total	$	7,666,774	$	– 0	–	$	105,708,915	$	– 0	–	$	113,375,689

** Principal amount less than 500.

(a) Position, or a portion thereof, has been segregated to collateralize reverse repurchase agreements.

(b) Position, or a portion thereof, has been segregated to collateralize OTC derivatives outstanding.

(c) Security is exempt from registration under Rule 144A of the Securities Act of 1933. These securities are considered liquid and may be resold in transactions exempt from registration, normally to qualified institutional buyers. At October 31, 2015, the aggregate market value of these securities amounted to $54,829,892 or 16.4% of net assets.

(d) Securities are perpetual and, thus, do not have a predetermined maturity date. The date shown, if applicable, reflects the next call date.

(e) Floating Rate Security. Stated interest rate was in effect at October 31, 2015.

(f) Variable rate coupon, rate shown as of October 31, 2015.

(g) IO – Interest Only

(h) The security is subject to a 12 month lock-up period, after which semi-annual redemptions are permitted.

(i) Restricted and illiquid security.

Restricted Securities	Acquisition Date		Cost		Market Value		Percentage of Net Assets
Mt Logan Re Ltd. (Preference Shares)		12/30/14	$	500,000	$	530,735		0.16	%

(j) Security is exempt from registration under Rule 144A of the Securities Act of 1933. These securities, which represent 0.00% of net assets as of October 31, 2015, are considered illiquid and restricted.

Restricted Securities	Acquisition Date		Cost		Market Value		Percentage of Net Assets
Virgolino de Oliveira Finance SA 10.50%, 1/28/18		1/27/14	$	363,153	$	8,515		0.00	%

(k) Security is in default and is non-income producing.

(l) To obtain a copy of the fund’s financial statements, please go to the Securities and Exchange Commission’s website at www.sec.gov, or call AB at (800) 227-4618.

(m) Investment in affiliated money market mutual fund. The rate shown represents the 7-day yield as of period end.

Currency Abbreviations:

AUD – Australian Dollar

BRL – Brazilian Real

CAD – Canadian Dollar

EUR – Euro

AB BOND INFLATION STRATEGY  • 41

Portfolio of Investments

GBP – Great British Pound

INR – Indian Rupee

JPY – Japanese Yen

NZD – New Zealand Dollar

SGD – Singapore Dollar

TWD – New Taiwan Dollar

USD – United States Dollar

Glossary:

ABS – Asset-Backed Securities

BBSW – Bank Bill Swap Reference Rate (Australia)

BKBM – Bank Bill Benchmark (New Zealand)

CBT – Chicago Board of Trade

CDOR – Canadian Dealer Offered Rate

CDX-NAHY – North American High Yield Credit Default Swap Index

CDX-NAIG – North American Investment Grade Credit Default Swap Index

CMBS – Commercial Mortgage-Backed Securities

CME – Chicago Mercantile Exchange

GSE – Government-Sponsored Enterprise

INTRCONX – Inter-Continental Exchange

LCH – London Clearing House

LIBOR – London Interbank Offered Rates

REIT – Real Estate Investment Trust

TIPS – Treasury Inflation Protected Security

See notes to financial statements.

42 •  AB BOND INFLATION STRATEGY

Portfolio of Investments

STATEMENT OF ASSETS & LIABILITIES

October 31, 2015

Assets
Investments in securities, at value
Investments in securities, at value (cost $443,027,688)	$	434,350,376
Affiliated issuers (cost $2,523,731)		2,523,731
Cash collateral due from broker		1,220,455
Foreign currencies, at value (cost $8,804,310)		8,705,837
Interest receivable		1,269,999
Receivable for capital stock sold		1,180,751
Unrealized appreciation on forward currency exchange contracts		309,301
Receivable for investment securities sold		219,870
Unrealized appreciation on credit default swaps		146,399
Unrealized appreciation on inflation swaps		95,381
Upfront premium paid on credit default swaps		18,258
Total assets		450,040,358
Liabilities
Due to custodian		94,834
Options written, at value (premiums received $10,075)		3,331
Payable for reverse repurchase agreements		113,375,689
Payable for capital stock redeemed		507,190
Unrealized depreciation on inflation swaps		502,732
Payable for investment securities purchased		168,405
Unrealized depreciation on interest rate swaps		121,365
Unrealized depreciation on forward currency exchange contracts		119,070
Payable for variation margin on exchange-traded derivatives		95,686
Advisory fee payable		75,880
Upfront premium received on credit default swaps		54,223
Distribution fee payable		28,380
Administrative fee payable		16,304
Transfer Agent fee payable		7,301
Accrued expenses		167,179
Total liabilities		115,337,569
Net Assets	$	334,702,789
Composition of Net Assets
Capital stock, at par	$	32,296
Additional paid-in capital		353,608,703
Undistributed net investment income		2,604,789
Accumulated net realized loss on investment and foreign currency transactions		(10,815,346	)
Net unrealized depreciation on investments and foreign currency denominated assets and liabilities		(10,727,653	)
	$	334,702,789

See notes to financial statements.

AB BOND INFLATION STRATEGY  • 43

Statement of Assets & Liabilities

Net Asset Value Per Share—30 billion shares of capital stock authorized, $.001 par value

Class	Net Assets		Shares Outstanding		Net Asset Value
A	$	13,660,392		1,308,567	$	10.44	*
C	$	2,678,781		260,735	$	10.27
Advisor	$	18,343,353		1,753,894	$	10.46
R	$	20,229		1,937	$	10.44
K	$	1,616,053		155,023	$	10.42
I	$	265,136		25,535	$	10.38
1	$	253,401,391		24,471,985	$	10.35
2	$	40,896,500		3,950,151	$	10.35
Z	$	3,820,954		368,230	$	10.38

* The maximum offering price per share for Class A shares was $10.90 which reflects a sales charge of 4.25%.

See notes to financial statements.

44 •  AB BOND INFLATION STRATEGY

Statement of Assets & Liabilities

STATEMENT OF OPERATIONS

Year Ended October 31, 2015

Investment Income
Interest	$	5,853,593
Dividends
Affiliated issuers		7,459
Unaffiliated issuers		2,678
Other income		2,731		$	5,866,461
Expenses
Advisory fee (see Note B)		1,761,015
Distribution fee—Class A		45,200
Distribution fee—Class C		31,279
Distribution fee—Class R		696
Distribution fee—Class K		4,922
Distribution fee—Class 1		272,232
Transfer agency—Class A		44,604
Transfer agency—Class C		9,615
Transfer agency—Advisor Class		51,473
Transfer agency—Class R		357
Transfer agency—Class K		3,216
Transfer agency—Class I		138
Transfer agency—Class 1		21,643
Transfer agency—Class 2		3,224
Transfer agency—Class Z		230
Custodian		203,539
Registration fees		134,991
Audit and tax		89,493
Printing		67,204
Legal		52,004
Administrative		49,296
Directors’ fees		18,330
Miscellaneous		18,513
Total expenses before interest expense		2,883,214
Interest expense		290,324
Total expenses		3,173,538
Less: expenses waived and reimbursed by the Adviser (see Note B)		(767,870	)
Net expenses					2,405,668
Net investment income					3,460,793
Realized and Unrealized Gain (Loss) on Investment and Foreign Currency Transactions
Net realized gain (loss) on:
Investment transactions					(1,051,151	)
Securities sold short					7,590
Futures					(922,689	)
Swaps					(2,440,447	)
Foreign currency transactions					2,075,091
Net change in unrealized appreciation/depreciation of:
Investments					(7,869,724	)
Futures					19,619
Options written					6,744
Swaps					(312,531	)
Foreign currency denominated assets and liabilities					(32,574	)
Net loss on investment and foreign currency transactions					(10,520,072	)
Net Decrease in Net Assets from Operations				$	(7,059,279	)

See notes to financial statements.

AB BOND INFLATION STRATEGY  • 45

Statement of Operations

STATEMENT OF CHANGES IN NET ASSETS

	Year Ended October 31, 2015			Year Ended October 31, 2014
Increase (Decrease) in Net Assets from Operations
Net investment income	$	3,460,793		$	7,257,676
Net realized loss on investment transactions and foreign currency transactions		(2,331,606	)		(3,331,693	)
Net change in unrealized appreciation/depreciation of investments and foreign currency denominated assets and liabilities		(8,188,466	)		2,402,522
Net increase (decrease) in net assets from operations		(7,059,279	)		6,328,505
Dividends to Shareholders from
Net investment income
Class A		(135,111	)		(324,609	)
Class C		(18,189	)		(47,997	)
Advisor Class		(203,846	)		(187,729	)
Class R		(1,105	)		(2,783	)
Class K		(20,282	)		(29,968	)
Class I		(7,362	)		(52,380	)
Class 1		(3,672,680	)		(6,051,926	)
Class 2		(556,237	)		(949,413	)
Class Z(a)		(14,356	)		– 0	–
Capital Stock Transactions
Net decrease		(28,377,535	)		(27,646,661	)
Total decrease		(40,065,982	)		(28,964,961	)
Net Assets
Beginning of period		374,768,771			403,733,732
End of period (including undistributed net investment income of $2,604,789 and $1,795,374, respectively)	$	334,702,789		$	374,768,771

(a) Commenced distributions on December 11, 2014.

See notes to financial statements.

46 •  AB BOND INFLATION STRATEGY

Statement of Changes in Net Assets

STATEMENT OF CASH FLOWS

For the Year Ended October 31, 2015

Cash flows from operating activities
Net decrease in net assets from operations				$	(7,059,279	)
Reconciliation of Net Decrease in Net Assets from Operations to Net Increase in Cash from Operating Activities:
Decrease in interest and dividends receivable	$	154,333
Decrease in receivable for investments sold		8,665,967
Net accretion of bond discount and amortization of bond premium		1,814,638
Inflation index adjustment		(1,043,164	)
Decrease in payable for investments purchased		(9,563,903	)
Decrease in accrued expenses		(33,952	)
Increase in cash collateral due from broker		(325,124	)
Purchases of long-term investments		(237,515,361	)
Purchases of short-term investments		(285,367,477	)
Proceeds from disposition of long-term investments		256,891,052
Proceeds from disposition of short-term investments		278,110,379
Proceeds from short sales transactions, net		7,590
Proceeds from options written, net		10,075
Payments on swaps, net		(2,392,236	)
Payments for exchange-traded derivatives settlements		(1,390,215	)
Net realized loss on investment transactions and foreign currency transactions		2,331,606
Net change in unrealized appreciation/depreciation of investments and foreign currency denominated assets and liabilities		8,188,466
Total adjustments					18,542,674
Net increase in cash from operating activities				$	11,483,395
Financing Activities:
Redemptions of capital stock, net		(31,933,752	)
Increase in due to custodian		94,834
Cash dividends paid (net of dividend reinvestments)*		(921,894	)
Increase in reverse repurchase agreements		27,992,602
Net decrease in cash from financing activities					(4,768,210	)
Effect of exchange rate on cash					1,986,252
Net increase in cash					8,701,437
Net change in cash
Cash at beginning of year					4,400
Cash at end of year				$	8,705,837
*  Reinvestment of dividends	$	3,707,274
Supplemental disclosure of cash flow information:
Interest expense paid during the year	$	286,229

In accordance with U.S. GAAP, the Strategy has included a Statement of Cash Flows as a result of its significant investments in reverse repurchase agreements throughout the year.

See notes to financial statements.

AB BOND INFLATION STRATEGY  • 47

Statement of Cash Flows

NOTES TO FINANCIAL STATEMENTS

October 31, 2015

NOTE A

Significant Accounting Policies

AB Bond Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940 as an open-end management investment company. Prior to January 20, 2015, the Fund was known as AllianceBernstein Bond Fund, Inc. The Fund, which is a Maryland corporation, operates as a series company comprised of nine portfolios currently in operation: the AB Intermediate Bond Portfolio, the AB Bond Inflation Strategy Portfolio, the AB Municipal Bond Inflation Strategy Portfolio, the AB All Market Real Return Portfolio (formerly AllianceBernstein Real Asset Strategy), the AB Limited Duration High Income Portfolio, the AB Government Reserves Portfolio, the AB Tax-Aware Fixed Income Portfolio, the AB Credit Long/Short Portfolio and the AB High Yield Portfolio. They are each diversified Portfolios, with the exception of the AB Credit Long/Short Portfolio and the AB High Yield Portfolio, which are non-diversified. Each Portfolio is considered to be a separate entity for financial reporting and tax purposes. This report relates only to the AB Bond Inflation Strategy Portfolio (the “Strategy”). Prior to January 20, 2015, the Portfolio was known as AllianceBernstein Bond Inflation Strategy Portfolio. The Strategy has authorized the issuance of Class A, Class B, Class C, Advisor Class, Class R, Class K, Class I, Class 1, Class 2 and Class Z shares. Effective December 11, 2014, the Strategy commenced offering of Class Z shares. Class B shares are not currently offered. Class 1 shares are sold only to the private clients of Sanford C. Bernstein & Co. LLC by its registered representatives. Class A shares are sold with a front-end sales charge of up to 4.25% for purchases not exceeding $1,000,000. With respect to purchases of $1,000,000 or more, Class A shares redeemed within one year of purchase may be subject to a contingent deferred sales charge of 1%. Class C shares are subject to a contingent deferred sales charge of 1% on redemptions made within the first year after purchase. Class R, Class K, and Class 1 shares are sold without an initial or contingent deferred sales charge. Advisor Class, Class I, Class 2 and Class Z shares are sold without an initial or contingent deferred sales charge and are not subject to ongoing distribution expenses. All ten classes of shares have identical voting, dividend, liquidation and other rights, except that the classes bear different distribution and transfer agency expenses. Each class has exclusive voting rights with respect to its distribution plan. The financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) which require management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements and amounts of income and expenses during the reporting period. Actual results could differ from those estimates. The Strategy is an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. The following is a summary of significant accounting policies followed by the Strategy.

48 •  AB BOND INFLATION STRATEGY

Notes to Financial Statements

1. Security Valuation

Portfolio securities are valued at their current market value determined on the basis of market quotations or, if market quotations are not readily available or are deemed unreliable, at “fair value” as determined in accordance with procedures established by and under the general supervision of the Fund’s Board of Directors (the “Board”).

In general, the market values of securities which are readily available and deemed reliable are determined as follows: securities listed on a national securities exchange (other than securities listed on the NASDAQ Stock Market, Inc. (“NASDAQ”)) or on a foreign securities exchange are valued at the last sale price at the close of the exchange or foreign securities exchange. If there has been no sale on such day, the securities are valued at the last traded price from the previous day. Securities listed on more than one exchange are valued by reference to the principal exchange on which the securities are traded; securities listed only on NASDAQ are valued in accordance with the NASDAQ Official Closing Price; listed or over the counter (“OTC”) market put or call options are valued at the mid level between the current bid and ask prices. If either a current bid or current ask price is unavailable, AllianceBernstein L.P. (the “Adviser”) will have discretion to determine the best valuation (e.g. last trade price in the case of listed options); open futures are valued using the closing settlement price or, in the absence of such a price, the most recent quoted bid price. If there are no quotations available for the day of valuation, the last available closing settlement price is used; U.S. Government securities and any other debt instruments having 60 days or less remaining until maturity are generally valued at market by an independent pricing vendor, if a market price is available. If a market price is not available, the securities are valued at amortized cost. This methodology is commonly used for short term securities that have an original maturity of 60 days or less, as well as short term securities that had an original term to maturity that exceeded 60 days. In instances when amortized cost is utilized, the Valuation Committee (the “Committee”) must reasonably conclude that the utilization of amortized cost is approximately the same as the fair value of the security. Such factors the Committee will consider include, but are not limited to, an impairment of the creditworthiness of the issuer or material changes in interest rates. Fixed-income securities, including mortgage-backed and asset-backed securities, may be valued on the basis of prices provided by a pricing service or at a price obtained from one or more of the major broker-dealers. In cases where broker-dealer quotes are obtained, the Adviser may establish procedures whereby changes in market yields or spreads are used to adjust, on a daily basis, a recently obtained quoted price on a security. Swaps and other derivatives are valued daily, primarily using independent pricing services, independent pricing models using market inputs, as well as third party broker-dealers or counterparties. Investment companies are valued at their net asset value each day.

AB BOND INFLATION STRATEGY  • 49

Notes to Financial Statements

Securities for which market quotations are not readily available (including restricted securities) or are deemed unreliable are valued at fair value. Factors considered in making this determination may include, but are not limited to, information obtained by contacting the issuer, analysts, analysis of the issuer’s financial statements or other available documents. In addition, the Strategy may use fair value pricing for securities primarily traded in non-U.S. markets because most foreign markets close well before the Strategy values its securities at 4:00 p.m., Eastern Time. The earlier close of these foreign markets gives rise to the possibility that significant events, including broad market moves, may have occurred in the interim and may materially affect the value of those securities.

2. Fair Value Measurements

In accordance with U.S. GAAP regarding fair value measurements, fair value is defined as the price that the Strategy would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP establishes a framework for measuring fair value, and a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability (including those valued based on their market values as described in Note A.1 above). Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Strategy. Unobservable inputs reflect the Strategy’s own assumptions about the assumptions that market participants would use in pricing the asset or liability based on the best information available in the circumstances. Each investment is assigned a level based upon the observability of the inputs which are significant to the overall valuation. The three-tier hierarchy of inputs is summarized below.

• Level 1—quoted prices in active markets for identical investments

• Level 2—other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

• Level 3—significant unobservable inputs (including the Strategy’s own assumptions in determining the fair value of investments)

The fair value of debt instruments, such as bonds, and over-the-counter derivatives is generally based on market price quotations, recently executed market transactions (where observable) or industry recognized modeling techniques and are generally classified as Level 2. Pricing vendor inputs to Level 2 valuations may include quoted prices for similar investments in active markets, interest rate curves, coupon rates, currency rates, yield curves, option adjusted spreads, default rates, credit spreads and other unique security features in order to estimate the relevant cash flows which are then discounted to calculate fair values. If these inputs are unobservable and significant to the fair value, these investments will be classified as Level 3. In addition, non-agency rated investments are classified as Level 3.

50 •  AB BOND INFLATION STRATEGY

Notes to Financial Statements

Where readily available market prices or relevant bid prices are not available for certain equity investments, such investments may be valued based on similar publicly traded investments, movements in relevant indices since last available prices or based upon underlying company fundamentals and comparable company data (such as multiples to earnings or other multiples to equity). Where an investment is valued using an observable input, such as another publicly traded security, the investment will be classified as Level 2. If management determines that an adjustment is appropriate based on restrictions on resale, illiquidity or uncertainty, and such adjustment is a significant component of the valuation, the investment will be classified as Level 3. An investment will also be classified as Level 3 where management uses company fundamentals and other significant inputs to determine the valuation.

Valuations of mortgage-backed or other asset-backed securities, by pricing vendors, are based on both proprietary and industry recognized models and discounted cash flow techniques. Significant inputs to the valuation of these instruments are value of the collateral, the rates and timing of delinquencies, the rates and timing of prepayments, and default and loss expectations, which are driven in part by housing prices for residential mortgages. Significant inputs are determined based on relative value analyses, which incorporate comparisons to instruments with similar collateral and risk profiles, including relevant indices. Mortgage and asset-backed securities for which management has collected current observable data through pricing services are generally categorized within Level 2. Those investments for which current observable data has not been provided are classified as Level 3.

Other fixed income investments, including non-U.S. government and corporate debt, are generally valued using quoted market prices, if available, which are typically impacted by current interest rates, maturity dates and any perceived credit risk of the issuer. Additionally, in the absence of quoted market prices, these inputs are used by pricing vendors to derive a valuation based upon industry or proprietary models which incorporate issuer specific data with relevant yield/spread comparisons with more widely quoted bonds with similar key characteristics. Those investments for which there are observable inputs are classified as Level 2. Where the inputs are not observable, the investments are classified as Level 3.

The following table summarizes the valuation of the Strategy’s investments by the above fair value hierarchy levels as of October 31, 2015:

Investments in Securities:	Level 1			Level 2		Level 3			Total
Assets:
Inflation-Linked Securities	$	– 0	–	$	262,760,429	$	– 0	–	$	262,760,429
Corporates – Investment Grade		– 0	–		63,105,311		– 0	–		63,105,311
Asset-Backed Securities		– 0	–		34,580,341		3,725,747			38,306,088
Commercial Mortgage-Backed Securities		– 0	–		26,834,483		7,333,784			34,168,267

AB BOND INFLATION STRATEGY  • 51

Notes to Financial Statements

Investments in Securities:

Level 1

Level 2

Level 3

Total

Corporates – Non-Investment Grade

$

– 0

–

$

10,762,859

$

– 0

–

$

10,762,859

Collateralized Mortgage Obligations

– 0

–

1,103,639

9,306,859

10,410,498

Quasi-Sovereigns

– 0

–

2,001,945

– 0

–

2,001,945

Governments – Sovereign Agencies

– 0

–

1,830,118

– 0

–

1,830,118

Governments – Treasuries

– 0

–

1,203,727

– 0

–

1,203,727

Governments – Sovereign Bonds

– 0

–

589,056

– 0

–

589,056

Common Stocks

– 0

–

– 0

–

530,735

530,735

Emerging Markets – Corporate Bonds

– 0

–

174,395

– 0

–

174,395

Preferred Stocks

54,033

– 0

–

– 0

–

54,033

Short-Term Investments:

Governments – Treasuries

– 0

–

8,452,915

– 0

–

8,452,915

Investment Companies

2,523,731

– 0

–

– 0

–

2,523,731

Total Investments in Securities

2,577,764

413,399,218

20,897,125

436,874,107

Other Financial Instruments*:

Assets:

Futures

31,786

– 0

–

– 0

–

31,786

#

Forward Currency Exchange Contracts

– 0

–

309,301

– 0

–

309,301

Centrally Cleared Credit Default Swaps

– 0

–

17,211

– 0

–

17,211

#

Centrally Cleared Interest Rate Swaps

– 0

–

986,562

– 0

–

986,562

#

Credit Default Swaps

– 0

–

146,399

– 0

–

146,399

Inflation (CPI) Swaps

– 0

–

95,381

– 0

–

95,381

Liabilities:

Futures

(218,172

)

– 0

–

– 0

–

(218,172

)#

Forward Currency Exchange Contracts

– 0

–

(119,070

)

– 0

–

(119,070

)

Currency Options Written

– 0

–

(3,331

)

– 0

–

(3,331

)

Centrally Cleared Credit Default Swaps

– 0

–

(296,140

)

– 0

–

(296,140

)#

Centrally Cleared Interest Rate Swaps

– 0

–

(2,294,336

)

– 0

–

(2,294,336

)#

Inflation (CPI) Swaps

– 0

–

(502,732

)

– 0

–

(502,732

)

Interest Rate Swaps

– 0

–

(121,365

)

– 0

–

(121,365

)

Total^

$

2,391,378

$

411,617,098

$

20,897,125

$

434,905,601

* Other financial instruments are derivative instruments, such as futures, forwards and swaps, which are valued at the unrealized appreciation/depreciation on the instrument. Other financial instruments may also include options written which are valued at market value.

# Only variation margin receivable/payable at period end is reported within the statement of assets and liabilities. This amount reflects cumulative appreciation/(depreciation) of exchange-traded derivatives as reported in the portfolio of investments.

^ There were no transfers between Level 1 and Level 2 during the reporting period.

52 •  AB BOND INFLATION STRATEGY

Notes to Financial Statements

The Strategy recognizes all transfers between levels of the fair value hierarchy assuming the financial instruments were transferred at the beginning of the reporting period.

The following is a reconciliation of investments in which significant unobservable inputs (Level 3) were used in determining fair value.

	Asset-Backed Securities			Commercial Mortgage-Backed Securities			Collateralized Mortgage Obligations
Balance as of 10/31/14	$	2,818,092		$	3,965,975		$	3,714,288
Accrued discounts/(premiums)		77			(19,882	)		(144	)
Realized gain (loss)		18			(1,465	)		20,059
Change in unrealized appreciation/depreciation		420			(154,007	)		(95,901	)
Purchases/Payups		2,791,627			3,563,083			7,594,028
Sales/Paydowns		(817,655	)		(19,920	)		(1,925,471	)
Transfers in to Level 3		– 0	–		– 0	–		– 0	–
Transfers out of Level 3		(1,066,832	)		– 0	–		– 0	–
Balance as of 10/31/15	$	3,725,747		$	7,333,784		$	9,306,859
Net change in unrealized appreciation/depreciation from Investments held as of 10/31/15*	$	420		$	(154,007	)	$	(98,367	)
	Common Stocks			Total
Balance as of 10/31/14	$	– 0	–	$	10,498,355
Accrued discounts/(premiums)		– 0	–		(19,949	)
Realized gain (loss)		– 0	–		18,612
Change in unrealized appreciation/depreciation		30,735			(218,753	)
Purchases/Payups		500,000			14,448,738
Sales/Paydowns		– 0	–		(2,763,046	)
Transfers in to Level 3		– 0	–		– 0	–
Transfers out of Level 3		– 0	–		(1,066,832	)
Balance as of 10/31/15	$	530,735		$	20,897,125	+
Net change in unrealized appreciation/depreciation from Investments held as of 10/31/15*	$	30,735		$	(221,219	)

+ There were de minimis transfers under 1% of net assets during the reporting period.

* The unrealized appreciation/depreciation is included in net change in unrealized appreciation/depreciation on investments and other financial instruments in the accompanying statement of operations.

As of October 31, 2015, all Level 3 securities were priced i) at net asset value, ii) by third party vendors, or iii) using prior transaction prices, which approximates fair value.

AB BOND INFLATION STRATEGY  • 53

Notes to Financial Statements

The Adviser established the Committee to oversee the pricing and valuation of all securities held in the Strategy. The Committee operates under pricing and valuation policies and procedures established by the Adviser and approved by the Board, including pricing policies which set forth the mechanisms and processes to be employed on a daily basis to implement these policies and procedures. In particular, the pricing policies describe how to determine market quotations for securities and other instruments. The Committee’s responsibilities include: 1) fair value and liquidity determinations (and oversight of any third parties to whom any responsibility for fair value and liquidity determinations is delegated), and 2) regular monitoring of the Adviser’s pricing and valuation policies and procedures and modification or enhancement of these policies and procedures (or recommendation of the modification of these policies and procedures) as the Committee believes appropriate.

The Committee is also responsible for monitoring the implementation of the pricing policies by the Adviser’s Pricing Group (the “Pricing Group”) and a third party which performs certain pricing functions in accordance with the pricing policies. The Pricing Group is responsible for the oversight of the third party on a day-to-day basis. The Committee and the Pricing Group perform a series of activities to provide reasonable assurance of the accuracy of prices including: 1) periodic vendor due diligence meetings, review of methodologies, new developments and processes at vendors, 2) daily comparison of security valuation versus prior day for all securities that exceeded established thresholds, and 3) daily review of unpriced, stale, and variance reports with exceptions reviewed by senior management and the Committee.

In addition, several processes outside of the pricing process are used to monitor valuation issues including: 1) performance and performance attribution reports are monitored for anomalous impacts based upon benchmark performance, and 2) portfolio managers review all portfolios for performance and analytics (which are generated using the Adviser’s prices).

3. Currency Translation

Assets and liabilities denominated in foreign currencies and commitments under forward currency exchange contracts are translated into U.S. dollars at the mean of the quoted bid and ask prices of such currencies against the U.S. dollar. Purchases and sales of portfolio securities are translated into U.S. dollars at the rates of exchange prevailing when such securities were acquired or sold. Income and expenses are translated into U.S. dollars at rates of exchange prevailing when accrued.

Net realized gain or loss on foreign currency transactions represents foreign exchange gains and losses from sales and maturities of foreign fixed income investments, foreign currency exchange contracts, holding of foreign currencies, currency gains or losses realized between the trade and settlement dates on foreign

54 •  AB BOND INFLATION STRATEGY

Notes to Financial Statements

investment transactions, and the difference between the amounts of dividends, interest and foreign withholding taxes recorded on the Strategy’s books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized currency gains and losses from valuing foreign currency denominated assets and liabilities at period end exchange rates are reflected as a component of net unrealized appreciation or depreciation of foreign currency denominated assets and liabilities.

4. Taxes

It is the Strategy’s policy to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its investment company taxable income and net realized gains, if any, to shareholders. Therefore, no provisions for federal income or excise taxes are required. The Strategy may be subject to taxes imposed by countries in which it invests. Such taxes are generally based on income and/or capital gains earned or repatriated. Taxes are accrued and applied to net investment income, net realized gains and net unrealized appreciation/depreciation as such income and/or gains are earned.

In accordance with U.S. GAAP requirements regarding accounting for uncertainties in income taxes, management has analyzed the Strategy’s tax positions taken or expected to be taken on federal and state income tax returns for all open tax years (the current and the prior three tax years) and has concluded that no provision for income tax is required in the Strategy’s financial statements.

5. Investment Income and Investment Transactions

Dividend income is recorded on the ex-dividend date or as soon as the Strategy is informed of the dividend. Interest income is accrued daily. Investment transactions are accounted for on the date the securities are purchased or sold. Investment gains or losses are determined on the identified cost basis. The Strategy amortizes premiums and accretes discounts as adjustments to interest income.

6. Class Allocations

All income earned and expenses incurred by the Strategy are borne on a pro-rata basis by each outstanding class of shares, based on the proportionate interest in the Strategy represented by the net assets of such class, except for class specific expenses which are allocated to the respective class. Expenses of the Fund are charged proportionately to each Strategy or based on other appropriate methods. Realized and unrealized gains and losses are allocated among the various share classes based on respective net assets.

7. Dividends and Distributions

Dividends and distributions to shareholders, if any, are recorded on the ex-dividend date. Income dividends and capital gains distributions are determined in accordance with federal tax regulations and may differ from those determined

AB BOND INFLATION STRATEGY  • 55

Notes to Financial Statements

in accordance with U.S. GAAP. To the extent these differences are permanent, such amounts are reclassified within the capital accounts based on their federal tax basis treatment; temporary differences do not require such reclassification.

NOTE B

Advisory Fee and Other Transactions with Affiliates

Under the terms of the investment advisory agreement, the Strategy pays the Adviser an advisory fee at an annual rate of .50% of the first $2.5 billion, .45% of the next $2.5 billion and .40% in excess of $5 billion, of the Strategy’s average daily net assets. The Adviser has agreed to waive its fees and bear certain expenses to the extent necessary to limit total operating expenses on an annual basis (“Expense Caps”) to .80%, 1.50%, .50%, 1.00%, .75%, .50%, .60%, .50% and .50% of the daily average net assets for the Class A, Class C, Advisor Class, Class R, Class K, Class I, Class 1, Class 2, and Class Z shares, respectively. Prior to February 1, 2014, the Expense Caps were .75%, 1.45%, .45%, .95%, .70%, .45%, .55% and .45% of the daily average net assets for the Class A, Class C, Advisor Class, Class R, Class K, Class I, Class 1, and Class 2 shares, respectively. Under the agreement, fees waived and expenses borne by the Adviser were subject to repayment by the Strategy until January 26, 2013. No repayment was made that would cause the Strategy’s total annualized operating expenses to exceed the net fee percentage set forth above, or would have exceeded the amount of offering expenses as recorded by the Strategy before January 26, 2011. This fee waiver and/or expense reimbursement agreement will remain in effect until January 31, 2016 and then may be extended for additional one-year terms. For the year ended October 31, 2015, such reimbursement amounted to $767,870.

Pursuant to the investment advisory agreement, the Strategy may reimburse the Adviser for certain legal and accounting services provided to the Strategy by the Adviser. For the year ended October 31, 2015, the reimbursement for such services amounted to $49,296.

The Strategy compensates AllianceBernstein Investor Services, Inc. (“ABIS”), a wholly-owned subsidiary of the Adviser, under a Transfer Agency Agreement for providing personnel and facilities to perform transfer agency services for the Strategy. ABIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. Such compensation retained by ABIS amounted to $96,225 for the year ended October 31, 2015.

AllianceBernstein Investments, Inc. (the “Distributor”), a wholly-owned subsidiary of the Adviser, serves as the distributor of the Strategy’s shares. The Distributor has advised the Strategy that it has retained front-end sales charges of $233 from the sale of Class A shares and received $47 and $214 in contingent deferred sales charges imposed upon redemptions by shareholders of Class A and Class C shares, respectively, for the year ended October 31, 2015.

56 •  AB BOND INFLATION STRATEGY

Notes to Financial Statements

The Strategy may invest in the AB Fixed-Income Shares, Inc.—Government STIF Portfolio (“Government STIF Portfolio”), an open-end management investment company managed by the Adviser. The Government STIF Portfolio is offered as a cash management option to mutual funds and other institutional accounts of the Adviser, and is not available for direct purchase by members of the public. The Government STIF Portfolio pays no investment management fees but does bear its own expenses. A summary of the Strategy’s transactions in shares of the Government STIF Portfolio for the year ended October 31, 2015 is as follows:

Market Value October 31, 2014 (000)		Purchases at Cost (000)		Sales Proceeds (000)		Market Value October 31, 2015 (000)		Dividend Income (000)
$	3,846	$	276,788	$	278,110	$	2,524	$	7

Brokerage commissions paid on investment transactions for the year ended October 31, 2015 amounted to $5,075, of which $0 and $0, respectively, was paid to Sanford C. Bernstein & Co. LLC and Sanford C. Bernstein Limited, affiliates of the Adviser.

NOTE C

Distribution Services Agreement

The Strategy has adopted a Distribution Services Agreement (the “Agreement”) pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the Agreement, the Strategy pays distribution and servicing fees to the Distributor at an annual rate of up to .30% of the Strategy’s average daily net assets attributable to Class A shares, 1% of the Strategy’s average daily net assets attributable to Class C shares, .50% of the Strategy’s average daily net assets attributable to Class R shares .25% of the Strategy’s average daily net assets attributable to Class K shares and .10% of the Strategy’s average daily net assets attributable to Class 1 shares. There are no distribution and servicing fees on the Advisor Class, Class I, Class 2 and Class Z shares. The fees are accrued daily and paid monthly. The Agreement provides that the Distributor will use such payments in their entirety for distribution assistance and promotional activities. Since the commencement of the Strategy’s operations, the Distributor has incurred expenses in excess of the distribution costs reimbursed by the Strategy in the amounts of $232,090, $15,914, $18,962 and $1,742,684 for Class C, Class R, Class K and Class 1 shares, respectively. While such costs may be recovered from the Strategy in future periods so long as the Agreement is in effect, the rate of the distribution and servicing fees payable under the Agreement may not be increased without a shareholder vote. In accordance with the Agreement, there is no provision for recovery of unreimbursed distribution costs incurred by the Distributor beyond the current fiscal year for Class A shares. The Agreement also provides that the Adviser may use its own resources to finance the distribution of the Strategy’s shares.

AB BOND INFLATION STRATEGY  • 57

Notes to Financial Statements

NOTE D

Investment Transactions

Purchases and sales of investment securities (excluding short-term investments) for the year ended October 31, 2015 were as follows:

	Purchases		Sales
Investment securities (excluding U.S. government securities)	$	77,396,476	$	38,666,344
U.S. government securities		160,118,885		203,138,937

The cost of investments for federal income tax purposes, gross unrealized appreciation and unrealized depreciation (excluding futures, foreign currency and swap transactions) are as follows:

Cost	$	446,087,829
Gross unrealized appreciation	$	1,810,665
Gross unrealized depreciation		(11,024,387	)
Net unrealized depreciation	$	(9,213,722	)

1. Derivative Financial Instruments

The Strategy may use derivatives in an effort to earn income and enhance returns, to replace more traditional direct investments, to obtain exposure to otherwise inaccessible markets (collectively, “investment purposes”), or to hedge or adjust the risk profile of its portfolio.

The principal types of derivatives utilized by the Strategy, as well as the methods in which they may be used are:

• Futures

The Strategy may buy or sell futures for investment purposes or for the purpose of hedging its portfolio against adverse effects of potential movements in the market. The Strategy bears the market risk that arises from changes in the value of these instruments and the imperfect correlation between movements in the price of the futures and movements in the price of the assets, reference rates or indices which they are designed to track. Among other things, the Strategy may purchase or sell futures for foreign currencies or options thereon for non-hedging purposes as a means of making direct investment in foreign currencies, as described below under “Currency Transactions”.

At the time the Strategy enters into futures, the Strategy deposits and maintains as collateral an initial margin with the broker, as required by the exchange on which the transaction is effected. Such amount is shown as cash collateral due from broker on the statement of assets and liabilities. Pursuant to the contract, the Strategy agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments are known as variation margin and are

58 •  AB BOND INFLATION STRATEGY

Notes to Financial Statements

recorded by the Strategy as unrealized gains or losses. Risks may arise from the potential inability of a counterparty to meet the terms of the contract. The credit/counterparty risk for exchange-traded futures is generally less than privately negotiated futures, since the clearinghouse, which is the issuer or counterparty to each exchange-traded future, has robust risk mitigation standards, including the requirement to provide initial and variation margin. When the contract is closed, the Strategy records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the time it was closed.

Use of long futures subjects the Strategy to risk of loss in excess of the amounts shown on the statement of assets and liabilities, up to the notional value of the futures. Use of short futures subjects the Strategy to unlimited risk of loss. Under some circumstances, futures exchanges may establish daily limits on the amount that the price of futures can vary from the previous day’s settlement price, which could effectively prevent liquidation of unfavorable positions.

During the year ended October 31, 2015, the Strategy held futures for hedging and non-hedging purposes.

• Forward Currency Exchange Contracts

The Strategy may enter into forward currency exchange contracts in order to hedge its exposure to changes in foreign currency exchange rates on its foreign portfolio holdings, to hedge certain firm purchase and sale commitments denominated in foreign currencies and for non-hedging purposes as a means of making direct investments in foreign currencies, as described below under “Currency Transactions”.

A forward currency exchange contract is a commitment to purchase or sell a foreign currency at a future date at a negotiated forward rate. The gain or loss arising from the difference between the original contract and the closing of such contract would be included in net realized gain or loss on foreign currency transactions. Fluctuations in the value of open forward currency exchange contracts are recorded for financial reporting purposes as unrealized appreciation and/or depreciation by the Strategy. Risks may arise from the potential inability of a counterparty to meet the terms of a contract and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar.

During the year ended October 31, 2015, the Strategy held forward currency exchange contracts for hedging and non-hedging purposes.

• Option Transactions

For hedging and investment purposes, the Strategy may purchase and write (sell) put and call options on U.S. and foreign securities, including government securities, and foreign currencies that are traded on U.S. and foreign securities exchanges and over-the-counter markets. Among other

AB BOND INFLATION STRATEGY  • 59

Notes to Financial Statements

things, the Strategy may use options transactions for non-hedging purposes as a means of making direct investments in foreign currencies, as described below under “Currency Transactions” and may use options strategies involving the purchase and/or writing of various combinations of call and/or put options, for hedging and investment purposes.

The risk associated with purchasing an option is that the Strategy pays a premium whether or not the option is exercised. Additionally, the Strategy bears the risk of loss of the premium and change in market value should the counterparty not perform under the contract. Put and call options purchased are accounted for in the same manner as portfolio securities. The cost of securities acquired through the exercise of call options is increased by premiums paid. The proceeds from securities sold through the exercise of put options are decreased by the premiums paid.

When the Strategy writes an option, the premium received by the Strategy is recorded as a liability and is subsequently adjusted to the current market value of the option written. Premiums received from written options which expire unexercised are recorded by the Strategy on the expiration date as realized gains from options written. The difference between the premium received and the amount paid on effecting a closing purchase transaction, including brokerage commissions, is also treated as a realized gain, or if the premium received is less than the amount paid for the closing purchase transaction, as a realized loss. If a call option is exercised, the premium received is added to the proceeds from the sale of the underlying security or currency in determining whether the Strategy has realized a gain or loss. If a put option is exercised, the premium received reduces the cost basis of the security or currency purchased by the Strategy. In writing an option, the Strategy bears the market risk of an unfavorable change in the price of the security or currency underlying the written option. Exercise of an option written by the Strategy could result in the Strategy selling or buying a security or currency at a price different from the current market value.

During the year ended October 31, 2015, the Strategy held written options for hedging purposes.

For the year ended October 31, 2015, the Strategy had the following transactions in written options:

	Number of Contracts			Premiums Received
Options written outstanding as of 10/31/14		– 0	–	$	– 0	–
Options written		4,260,000			10,075
Options expired		– 0	–		– 0	–
Options bought back		– 0	–		– 0	–
Options exercised		– 0	–		– 0	–
Options written outstanding as of 10/31/15		4,260,000		$	10,075

60 •  AB BOND INFLATION STRATEGY

Notes to Financial Statements

• Swaps

The Strategy may enter into swaps to hedge its exposure to interest rates, credit risk, or currencies. The Strategy may also enter into swaps for non-hedging purposes as a means of gaining market exposures, including by making direct investments in foreign currencies, as described below under “Currency Transactions”. A swap is an agreement that obligates two parties to exchange a series of cash flows at specified intervals based upon or calculated by reference to changes in specified prices or rates for a specified amount of an underlying asset. The payment flows are usually netted against each other, with the difference being paid by one party to the other. In addition, collateral may be pledged or received by the Strategy in accordance with the terms of the respective swaps to provide value and recourse to the Strategy or its counterparties in the event of default, bankruptcy or insolvency by one of the parties to the swap.

Risks may arise as a result of the failure of the counterparty to the swap to comply with the terms of the swap. The loss incurred by the failure of a counterparty is generally limited to the net interim payment to be received by the Strategy, and/or the termination value at the end of the contract. Therefore, the Strategy considers the creditworthiness of each counterparty to a swap in evaluating potential counterparty risk. This risk is mitigated by having a netting arrangement between the Strategy and the counterparty and by the posting of collateral by the counterparty to the Strategy to cover the Strategy’s exposure to the counterparty. Additionally, risks may arise from unanticipated movements in interest rates or in the value of the underlying securities. The Strategy accrues for the interim payments on swaps on a daily basis, with the net amount recorded within unrealized appreciation/depreciation of swaps on the statement of assets and liabilities, where applicable. Once the interim payments are settled in cash, the net amount is recorded as realized gain/(loss) on swaps on the statement of operations, in addition to any realized gain/(loss) recorded upon the termination of swaps. Upfront premiums paid or received are recognized as cost or proceeds on the statement of assets and liabilities and are amortized on a straight line basis over the life of the contract. Amortized upfront premiums are included in net realized gain/(loss) from swaps on the statement of operations. Fluctuations in the value of swaps are recorded as a component of net change in unrealized appreciation/depreciation of swaps on the statement of operations.

Certain standardized swaps, including certain interest rate swaps and credit default swaps, are (or soon will be) subject to mandatory central clearing. Cleared swaps are transacted through futures commission merchants (“FCMs”) that are members of central clearinghouses, with the clearinghouse serving as central counterparty, similar to transactions in futures contracts. Centralized clearing will be required for additional categories of swaps on a phased-in basis based on requirements published by the Securities and Exchange Commission and Commodity Futures Trading Commission.

AB BOND INFLATION STRATEGY  • 61

Notes to Financial Statements

At the time the Strategy enters into a centrally cleared swap, the Strategy deposits and maintains as collateral an initial margin with the broker, as required by the clearinghouse on which the transaction is effected. Such amount is shown as cash collateral due from broker on the statement of assets and liabilities. Pursuant to the contract, the Strategy agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments are known as variation margin and are recorded by the Strategy as unrealized gains or losses. Risks may arise from the potential of a counterparty to meet the terms of the contract. The credit/counterparty risk for centrally cleared swaps is generally less than non-centrally cleared swaps, since the clearinghouse, which is the issuer or counterparty to each centrally cleared swap, has robust risk mitigation standards, including the requirement to provide initial and variation margin. When the contract is closed, the Strategy records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the time it was closed.

Interest Rate Swaps:

The Strategy is subject to interest rate risk exposure in the normal course of pursuing its investment objectives. Because the Strategy holds fixed rate bonds, the value of these bonds may decrease if interest rates rise. To help hedge against this risk and to maintain its ability to generate income at prevailing market rates, the Strategy may enter into interest rate swaps. Interest rate swaps are agreements between two parties to exchange cash flows based on a notional amount. The Strategy may elect to pay a fixed rate and receive a floating rate, or, receive a fixed rate and pay a floating rate on a notional amount.

In addition, the Strategy may also enter into interest rate swap transactions to preserve a return or spread on a particular investment or portion of its portfolio, or protecting against an increase in the price of securities the Strategy anticipates purchasing at a later date. Interest rate swaps involve the exchange by a Strategy with another party of their respective commitments to pay or receive interest (e.g., an exchange of floating rate payments for fixed rate payments) computed based on a contractually-based principal (or “notional”) amount. Interest rate swaps are entered into on a net basis (i.e., the two payment streams are netted out, with the Strategy receiving or paying, as the case may be, only the net amount of the two payments).

During the year ended October 31, 2015, the Strategy held interest rate swaps for hedging and non-hedging purposes.

Inflation (CPI) Swaps:

Inflation swaps are contracts in which one party agrees to pay the cumulative percentage increase in a price index (the Consumer Price Index with respect to CPI swaps) over the term of the swap (with some lag on

62 •  AB BOND INFLATION STRATEGY

Notes to Financial Statements

the inflation index), and the other pays a compounded fixed rate. Inflation swaps may be used to protect the net asset value, or NAV, of a Strategy against an unexpected change in the rate of inflation measured by an inflation index since the value of these agreements is expected to increase if unexpected inflation increases.

During the year ended October 31, 2015, the Strategy held inflation (CPI) swaps for hedging and non-hedging purposes.

Credit Default Swaps:

The Strategy may enter into credit default swaps, including to manage its exposure to the market or certain sectors of the market, to reduce its risk exposure to defaults by corporate and sovereign issuers held by the Strategy, or to create exposure to corporate or sovereign issuers to which it is not otherwise exposed. The Strategy may purchase credit protection (“Buy Contract”) or provide credit protection (“Sale Contract”) on the referenced obligation of the credit default swap. During the term of the swap, the Strategy receives/(pays) fixed payments from/(to) the respective counterparty, calculated at the agreed upon rate applied to the notional amount. If the Strategy is a buyer/(seller) of protection and a credit event occurs, as defined under the terms of the swap, the Strategy will either (i) receive from the seller/(pay to the buyer) of protection an amount equal to the notional amount of the swap (the “Maximum Payout Amount”) and deliver/(take delivery of) the referenced obligation or (ii) receive/(pay) a net settlement amount in the form of cash or securities equal to the notional amount of the swap less the recovery value of the referenced obligation.

In certain circumstances Maximum Payout Amounts may be partially offset by recovery values of the respective referenced obligations, upfront premium received upon entering into the agreement, or net amounts received from settlement of buy protection credit default swaps entered into by the Strategy for the same reference obligation with the same counterparty. As of October 31, 2015, the Strategy did not have Buy Contracts outstanding with respect to the same referenced obligations and same counterparty for its Sale Contracts outstanding.

Credit default swaps may involve greater risks than if a Strategy had invested in the referenced obligation directly. Credit default swaps are subject to general market risk, liquidity risk, counterparty risk and credit risk. If the Strategy is a buyer of protection and no credit event occurs, it will lose the payments it made to its counterparty. If the Strategy is a seller of protection and a credit event occurs, the value of the referenced obligation received by the Strategy coupled with the periodic payments previously received, may be less than the Maximum Payout Amount it pays to the buyer, resulting in a net loss to the Strategy.

AB BOND INFLATION STRATEGY  • 63

Notes to Financial Statements

During the year ended October 31, 2015, the Strategy held credit default swaps for hedging and non-hedging purposes.

Implied credit spreads over U.S. Treasuries of comparable maturity utilized in determining the market value of credit default swaps on issuers as of period end are disclosed in the portfolio of investments. The implied spreads serve as an indicator of the current status of the payment/performance risk and typically reflect the likelihood of default by the issuer of the referenced obligation. The implied credit spread of a particular reference obligation also reflects the cost of buying/selling protection and may reflect upfront payments required to be made to enter into the agreement. Widening credit spreads typically represent a deterioration of the referenced obligation’s credit soundness and greater likelihood of default or other credit event occurring as defined under the terms of the agreement. A credit spread identified as “Defaulted” indicates a credit event has occurred for the referenced obligation.

The Strategy typically enters into International Swaps and Derivatives Association, Inc. Master Agreements (“ISDA Master Agreement”) or similar master agreements (collectively, “Master Agreements”) with its derivative contract counterparties in order to, among other things, reduce its credit risk to counterparties. ISDA Master Agreements include provisions for general obligations, representations, collateral and events of default or termination. Under an ISDA Master Agreement, the Strategy typically may offset with the counterparty certain derivative financial instrument’s payables and/or receivables with collateral held and/or posted and create one single net payment (close-out netting) in the event of default or termination.

Various Master Agreements govern the terms of certain transactions with counterparties, including transactions such as derivative transactions, repurchase and reverse repurchase agreements. These Master Agreements typically attempt to reduce the counterparty risk associated with such transactions by specifying credit protection mechanisms and providing standardization that improves legal certainty. Cross-termination provisions under Master Agreements typically provide that a default in connection with one transaction between the Strategy and a counterparty gives the non-defaulting party the right to terminate any other transactions in place with the defaulting party to create one single net payment due to/due from the defaulting party. In the event of a default by a Master Agreements counterparty, the return of collateral with market value in excess of the Strategy’s net liability, held by the defaulting party, may be delayed or denied.

The Strategy’s Master Agreements may contain provisions for early termination of OTC derivative transactions in the event the net assets of the Strategy decline below specific levels (“net asset contingent features”). If these levels are triggered, the Strategy’s counterparty has the right to terminate such transaction

64 •  AB BOND INFLATION STRATEGY

Notes to Financial Statements

and require the Strategy to pay or receive a settlement amount in connection with the terminated transaction. For additional details, please refer to netting arrangements by counterparty tables below.

At October 31, 2015, the Strategy had entered into the following derivatives:

	Asset Derivatives				Liability Derivatives
Derivative Type	Statement of Assets and Liabilities Location	Fair Value			Statement of Assets and Liabilities Location	Fair Value
Interest rate contracts	Receivable/Payable for variation margin on exchange-traded derivatives	$	1,018,348	*	Receivable/Payable for variation margin on exchange-traded derivatives	$	2,512,508	*
Credit contracts	Receivable/Payable for variation margin on exchange-traded derivatives		17,211	*	Receivable/Payable for variation margin on exchange-traded derivatives		296,140	*
Foreign exchange contracts	Unrealized appreciation on forward currency exchange contracts		309,301		Unrealized depreciation on forward currency exchange contracts		119,070
Foreign exchange contracts					Options written, at value		3,331
Interest rate contracts					Unrealized depreciation on interest rate swaps		121,365
Interest rate contracts	Unrealized appreciation on inflation swaps		95,381		Unrealized depreciation on inflation swaps		502,732
Credit contracts	Unrealized appreciation on credit default swaps		146,399
Total		$	1,586,640			$	3,555,146

* Only variation margin receivable/payable at period end is reported within the statement of assets and liabilities. This amount reflects cumulative appreciation/(depreciation) of exchange-traded derivatives as reported in the portfolio of investments.

AB BOND INFLATION STRATEGY  • 65

Notes to Financial Statements

The effect of derivative instruments on the statement of operations for the year ended October 31, 2015:

Derivative Type	Location of Gain or (Loss) on Derivatives	Realized Gain or (Loss) on Derivatives			Change in Unrealized Appreciation or (Depreciation)
Interest rate contracts	Net realized gain (loss) on futures; Net change in unrealized appreciation/depreciation of futures	$	(922,689	)	$	19,619
Foreign exchange contracts	Net realized gain (loss) on foreign currency transactions; Net change in unrealized appreciation/depreciation of foreign currency denominated assets and liabilities		768,987			56,265
Foreign exchange contracts	Net realized gain (loss) on options written; Net change in unrealized appreciation/depreciation of options written		– 0	–		6,744
Interest rate contracts	Net realized gain (loss) on swaps; Net change in unrealized appreciation/depreciation of swaps		(2,326,608	)		(354,221	)
Credit contracts	Net realized gain (loss) on swaps; Net change in unrealized appreciation/depreciation of swaps		(113,839	)		41,690
Total		$	(2,594,149	)	$	(229,903	)

The following table represents the average monthly volume of the Strategy’s derivative transactions during the year ended October 31, 2015:

Futures:
Average original value of buy contracts	$	8,766,469
Average original value of sale contracts	$	33,890,178
Forward Currency Exchange Contracts:
Average principal amount of buy contracts	$	5,689,306
Average principal amount of sale contracts	$	24,809,121
Interest Rate Swaps:
Average notional amount	$	6,113,637

66 •  AB BOND INFLATION STRATEGY

Notes to Financial Statements

Inflation Swaps:
Average notional amount	$	60,507,692
Centrally Cleared Interest Rate Swaps:
Average notional amount	$	104,985,291
Credit Default Swaps:
Average notional amount of buy contracts	$	1,280,000
Average notional amount of sale contracts	$	4,471,231
Centrally Cleared Credit Default Swaps:
Average notional amount of buy contracts	$	22,662,538

For financial reporting purposes, the Strategy does not offset derivative assets and derivative liabilities that are subject to netting arrangements in the statement of assets and liabilities.

All derivatives held at period end were subject to netting arrangements. The following table presents the Strategy’s derivative assets and liabilities by counterparty net of amounts available for offset under Master Agreements (“MA”) and net of the related collateral received/ pledged by the Strategy as of October 31, 2015:

Counterparty

Derivative Assets Subject to a MA

Derivative Available for Offset

Cash Collateral Received

Security Collateral Received

Net Amount of Derivatives Assets

OTC Derivatives:

Bank of America, NA

$

48,869

$

– 0

–

$

– 0

–

$

– 0

–

$

48,869

Barclays Bank PLC

95,381

(95,381

)

– 0

–

– 0

–

– 0

–

BNP Paribas SA

27,531

– 0

–

– 0

–

– 0

–

27,531

Citibank, NA

57,577

(57,577

)

– 0

–

– 0

–

– 0

–

Credit Suisse International

165

– 0

–

– 0

–

– 0

–

165

Deutsche Bank AG

3,823

(3,823

)

– 0

–

– 0

–

– 0

–

Goldman Sachs Bank USA

102,482

(45,920

)

– 0

–

– 0

–

56,562

HSBC Bank USA

81,007

(5,052

)

– 0

–

– 0

–

75,955

JPMorgan Chase Bank/ JPMorgan Chase Bank, NA

45,924

(45,924

)

– 0

–

– 0

–

– 0

–

Standard Chartered Bank

753

(753

)

– 0

–

– 0

–

– 0

–

State Street Bank & Trust Co.

51,604

– 0

–

– 0

–

– 0

–

51,604

Total

$

515,116

$

(254,430

)

$

– 0

–

$

– 0

–

$

260,686

^

AB BOND INFLATION STRATEGY  • 67

Notes to Financial Statements

Counterparty	Derivative Liabilities Subject to a MA		Derivative Available for Offset			Cash Collateral Pledged*			Security Collateral Pledged			Net Amount of Derivatives Liabilities
Exchange-Traded Derivatives:
Citigroup Global Markets, Inc.**	$	1,327	$	– 0	–	$	(1,327	)	$	– 0	–	$	– 0	–
Goldman Sachs & Co.**		10,139		– 0	–		(10,139	)		– 0	–		– 0	–
Morgan Stanley & Co., LLC**		84,220		– 0	–		(84,220	)		– 0	–		– 0	–
Total	$	95,686	$	– 0	–	$	(95,686	)	$	– 0	–	$	– 0	–
OTC Derivatives:
Barclays Bank PLC	$	127,154	$	(95,381	)	$	– 0	–	$	– 0	–	$	31,773
Citibank, NA		93,312		(57,577	)		– 0	–		– 0	–		35,735
Deutsche Bank AG		144,031		(3,823	)		– 0	–		(131,944	)		8,264
Goldman Sachs Bank USA		45,920		(45,920	)		– 0	–		– 0	–		– 0	–
HSBC Bank USA		5,052		(5,052	)		– 0	–		– 0	–		– 0	–
JPMorgan Chase Bank/ JPMorgan Chase Bank, NA		141,566		(45,924	)		– 0	–		– 0	–		95,642
Morgan Stanley Capital Services LLC		128,622		– 0	–		– 0	–		– 0	–		128,622
Standard Chartered Bank		60,841		(753	)		– 0	–		– 0	–		60,088
Total	$	746,498	$	(254,430	)	$	– 0	–	$	(131,944	)	$	360,124	^

* The actual collateral received/pledged may be more than the amount reported due to overcollateralization.

** Cash has been posted for initial margin requirements for exchange traded derivatives outstanding at October 31, 2015.

^ Net amount represents the net receivable/payable that would be due from/to the counterparty in the event of default or termination. The net amount from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same counterparty.

See Note D.4 for additional disclosure of netting arrangements regarding reverse repurchase agreements.

2. Currency Transactions

The Strategy may invest in non-U.S. dollar securities on a currency hedged or unhedged basis. The Strategy may seek investment opportunities by taking long or short positions in currencies through the use of currency-related derivatives, including forward currency exchange contracts, futures and options on futures, swaps, and other options. The Strategy may enter into transactions for investment opportunities when it anticipates that a foreign currency will appreciate or

68 •  AB BOND INFLATION STRATEGY

Notes to Financial Statements

depreciate in value but securities denominated in that currency are not held by the Strategy and do not present attractive investment opportunities. Such transactions may also be used when the Adviser believes that it may be more efficient than a direct investment in a foreign currency-denominated security. The Strategy may also conduct currency exchange contracts on a spot basis (i.e., for cash at the spot rate prevailing in the currency exchange market for buying or selling currencies).

3. TBA and Dollar Rolls

The Strategy may invest in TBA mortgage-backed securities. A TBA, or “To Be Announced”, trade represents a contract for the purchase or sale of mortgage-backed securities to be delivered at a future agree-upon date; however, the specific mortgage pool numbers or the number of pools that will be delivered to fulfill the trade obligation or terms of the contract are unknown at the time of the trade. Mortgage pools (including fixed-rate or variable-rate mortgages) guaranteed by the Government National Mortgage Association, or GNMA, the Federal National Mortgage Association, or FNMA, or the Federal Home Loan Mortgage Corporation, or FHLMC, are subsequently allocated to the TBA transactions.

The Strategy may enter into dollar rolls. Dollar rolls involve sales by the Strategy of securities for delivery in the current month and the Strategy’s simultaneously contracting to repurchase substantially similar (same type and coupon) securities on a specified future date. During the roll period, the Strategy forgoes principal and interest paid on the securities. The Strategy is compensated by the difference between the current sales price and the lower forward price for the future purchase (often referred to as the “drop”) as well as by the interest earned on the cash proceeds of the initial sale. Dollar rolls involve the risk that the market value of the securities the Strategy is obligated to repurchase under the agreement may decline below the repurchase price. Dollar rolls are speculative techniques. During the year ended October 31, 2015, the Strategy had no transactions in dollar rolls.

4. Reverse Repurchase Agreements

The Strategy may enter into reverse repurchase transactions (“RVP”) in accordance with the terms of a Master Repurchase Agreement (“MRA”), under which the Strategy sells securities and agrees to repurchase them at a mutually agreed upon date and price. At the time the Strategy enters into a reverse repurchase agreement, it will establish a segregated account with the custodian containing liquid assets having a value comparable to the repurchase price. Under the MRA and other Master Agreements, the Strategy is permitted to offset payables and/or receivables with collateral held and/or posted to the counterparty and create one single net payment due to or from the Strategy in the event of a default. In the event of a default by a MRA counterparty, the Strategy may be considered an unsecured creditor with respect to any excess collateral (collateral with a market value in excess of the repurchase price) held by and/or posted to the counterparty,

AB BOND INFLATION STRATEGY  • 69

Notes to Financial Statements

and as such the return of such excess collateral may be delayed or denied. For the year ended October 31, 2015, the average amount of reverse repurchase agreements outstanding was $115,431,269 and the daily weighted average interest rate was 0.24%. At October 31, 2015, the Strategy had reverse repurchase agreements outstanding in the amount of $113,375,689 as reported on the statement of assets and liabilities. During the period, the Strategy received net interest payment from counterparties.

The following table presents the Strategy’s RVP liabilities by counterparty net of the related collateral pledged by the Strategy as of October 31, 2015:

Counterparty	RVP Liabilities Subject to a MRA		Securities Collateral Pledged†*			Net Amount of RVP Liabilities
Bank of America	$	24,502,001	$	(24,502,001	)	$	– 0	–
Barclays Capital, Inc.		2,401,540		(2,401,540	)		– 0	–
HSBC Bank USA		56,861,382		(56,773,117	)		88,265
JPMorgan Chase Bank		29,610,766		(29,572,143	)		38,623
Total	$	113,375,689	$	(113,248,801	)	$	126,888

^†  Including accrued interest.

* The actual collateral pledged may be more than the amount reported due to overcollateralization.

NOTE E

Capital Stock

Each class consists of 3,000,000,000 authorized shares. Transactions in capital shares for each class were as follows:

	Shares						Amount
	Year Ended October 31, 2015			Year Ended October 31, 2014			Year Ended October 31, 2015			Year Ended October 31, 2014
Class A
Shares sold		169,441			365,636		$	1,801,811		$	3,958,275
Shares issued in reinvestment of dividends		11,466			26,770			120,842			291,538
Shares redeemed		(344,463	)		(1,081,920	)		(3,652,268	)		(11,685,187	)
Net decrease		(163,556	)		(689,514	)	$	(1,729,615	)	$	(7,435,374	)
Class C
Shares sold		44,035			18,830		$	461,102		$	201,233
Shares issued in reinvestment of dividends		1,497			3,806			15,586			41,032
Shares redeemed		(122,764	)		(230,439	)		(1,282,056	)		(2,459,540	)
Net decrease		(77,232	)		(207,803	)	$	(805,368	)	$	(2,217,275	)

70 •  AB BOND INFLATION STRATEGY

Notes to Financial Statements

	Shares						Amount
	Year Ended October 31, 2015			Year Ended October 31, 2014			Year Ended October 31, 2015			Year Ended October 31, 2014
Advisor Class
Shares sold		513,914			1,013,910		$	5,473,679		$	10,977,539
Shares issued in reinvestment of dividends		17,717			15,279			186,880			166,616
Shares redeemed		(273,750	)		(269,728	)		(2,917,777	)		(2,933,678	)
Net increase		257,881			759,461		$	2,742,782		$	8,210,477
Class R
Shares sold		2,736			3,557		$	29,226		$	38,616
Shares issued in reinvestment of dividends		104			255			1,105			2,783
Shares redeemed		(22,219	)		(1,811	)		(237,039	)		(19,578	)
Net increase (decrease)		(19,379	)		2,001		$	(206,708	)	$	21,821
Class K
Shares sold		42,242			90,056		$	449,842		$	974,305
Shares issued in reinvestment of dividends		1,925			2,755			20,281			29,968
Shares redeemed		(95,208	)		(70,120	)		(1,009,773	)		(753,094	)
Net increase (decrease)		(51,041	)		22,691		$	(539,650	)	$	251,179
Class I
Shares sold		28,559			60,929		$	302,454		$	660,107
Shares issued in reinvestment of dividends		688			4,646			7,241			50,358
Shares redeemed		(82,025	)		(231,495	)		(865,824	)		(2,489,428	)
Net decrease		(52,778	)		(165,920	)	$	(556,129	)	$	(1,778,963	)
Class 1
Shares sold		3,177,028			8,046,926		$	33,474,332		$	86,492,452
Shares issued in reinvestment of dividends		276,081			421,004			2,888,583			4,555,895
Shares redeemed		(5,915,647	)		(10,830,473	)		(62,348,456	)		(116,610,335	)
Net decrease		(2,462,538	)		(2,362,543	)	$	(25,985,541	)	$	(25,561,988	)

AB BOND INFLATION STRATEGY  • 71

Notes to Financial Statements

	Shares						Amount
	Year Ended October 31, 2015			Year Ended October 31, 2014			Year Ended October 31, 2015			Year Ended October 31, 2014
Class 2
Shares sold		1,143,181			1,144,093		$	12,002,916		$	12,184,729
Shares issued in reinvestment of dividends		43,283			70,568			452,514			763,421
Shares redeemed		(1,654,114	)		(1,126,681	)		(17,603,900	)		(12,084,688	)
Net increase (decrease)		(467,650	)		87,980		$	(5,148,470	)	$	863,462
Class Z(a)
Shares sold		407,576			– 0	–	$	4,264,298		$	– 0	–
Shares issued in reinvestment of dividends		1,367			– 0	–		14,242			– 0	–
Shares redeemed		(40,713	)		– 0	–		(427,376	)		– 0	–
Net increase		368,230			– 0	–	$	3,851,164		$	– 0	–

^(a) Commenced distributions on December 11, 2014.

NOTE F

Risks Involved in Investing in the Strategy

Interest Rate Risk and Credit Risk—Interest rate risk is the risk that changes in interest rates will affect the value of the Strategy’s investments in fixed-income debt securities such as bonds or notes. Increases in interest rates may cause the value of the Strategy’s investments to decline. Credit risk is the risk that the issuer or guarantor of a debt security, or the counterparty to a derivative contract, will be unable or unwilling to make timely principal and/or interest payments, or to otherwise honor its obligations. The degree of risk for a particular security may be reflected in its credit rating. Credit risk is greater for medium quality and lower-rated securities. Lower-rated debt securities and similar unrated securities (commonly known as “junk bonds”) have speculative elements or are predominantly speculative risks.

Duration Risk—Duration is the measure that relates the expected price volatility of a fixed-income security to changes in interest rates. The duration of a fixed-income security may be shorter than or equal to full maturity of a fixed-income security. Fixed-income securities with longer durations have more risk and will decrease in price as interest rates rise. For example, a fixed-income security with a duration of three years will decrease in value by approximately 3% if interest rates increase by 1%.

Inflation Risk—This is the risk that the value of assets or income from investments will be less in the future as inflation decreases the value of money. As inflation increases, the real value of the Strategy’s assets can decline as can the real value of the Strategy’s distributions.

72 •  AB BOND INFLATION STRATEGY

Notes to Financial Statements

Derivatives Risk—The Fund may enter into derivative transactions such as forwards, options, futures and swaps. Derivatives may be illiquid, difficult to price, and leveraged so that small changes may produce disproportionate losses for the Fund, and subject to counterparty risk to a greater degree than more traditional investments. Derivatives may result in significant losses, including losses that are far greater than the value of the derivatives reflected on the statement of assets and liabilities.

Foreign (Non-U.S.) Risk—Investments in securities of non-U.S. issuers may involve more risk than those of U.S. issuers. These securities may fluctuate more widely in price and may be less liquid due to adverse market, economic, political, regulatory or other factors.

Currency Risk—Fluctuations in currency exchange rates may negatively affect the value of the Strategy’s investments or reduce its returns.

Leverage Risk—When the Fund borrows money or otherwise leverages its investments, its performance may be volatile because leverage tends to exaggerate the effect of any increase or decrease in the value of the Fund’s investments. The Fund may create leverage through the use of reverse repurchase arrangements, forward currency exchange contracts, forward commitments, dollar rolls or futures or by borrowing money. The use of derivative instruments by the Fund, such as forwards, futures, options and swaps, may also result in a form of leverage. Leverage may result in higher returns to the Fund than if the Fund were not leveraged, but may also adversely affect returns, particularly if the market is declining.

Liquidity Risk—Liquidity risk occurs when certain investments become difficult to purchase or sell. Difficulty in selling less liquid securities may result in sales at disadvantageous prices affecting the value of your investment in the Strategy. Causes of liquidity risk may include low trading volumes, large positions and heavy redemptions of fixed-income mutual fund shares. Over recent years, liquidity risk has also increased because the capacity of dealers in the secondary market for fixed-income securities to make markets in these securities has decreased, even as the overall bond market has grown significantly, due to, among other things, structural changes, additional regulatory requirements and capital and risk restraints that have led to reduced inventories. Liquidity risk may be higher in a rising interest rate environment, when the value and liquidity of fixed-income securities generally go down.

Indemnification Risk—In the ordinary course of business, the Strategy enters into contracts that contain a variety of indemnifications. The Strategy’s maximum exposure under these arrangements is unknown. However, the Strategy has not had prior claims or losses pursuant to these indemnification provisions and expects the risk of loss thereunder to be remote. Therefore, the Strategy has not accrued any liability in connection with these indemnification provisions.

AB BOND INFLATION STRATEGY  • 73

Notes to Financial Statements

NOTE G

Joint Credit Facility

A number of open-end mutual funds managed by the Adviser, including the Strategy, participate in a $280 million revolving credit facility (the “Facility”) intended to provide short-term financing, if necessary, subject to certain restrictions in connection with abnormal redemption activity. Commitment fees related to the Facility are paid by the participating funds and are included in miscellaneous expenses in the statement of operations. The Strategy did not utilize the Facility during the year ended October 31, 2015.

NOTE H

Distributions to Shareholders

The tax character of distributions paid during the fiscal years ended October 31, 2015 and October 31, 2014 were as follows:

	2015		2014
Distributions paid from:
Ordinary income	$	4,629,168	$	7,646,805
Total taxable distributions paid	$	4,629,168	$	7,646,805

As of October 31, 2015, the components of accumulated earnings/(deficit) on a tax basis were as follows:

Undistributed ordinary income	$	2,563,654
Accumulated capital and other losses		(10,535,991	)(a)
Unrealized appreciation/(depreciation)		(10,834,598	)(b)
Total accumulated earnings/(deficit)	$	(18,806,935	)(c)

^(a)  At October 31, 2015, the Strategy had a net capital loss carryforward of $10,535,991.

^(b)  The differences between book-basis and tax-basis unrealized appreciation/(depreciation) are attributable primarily to the tax deferral of losses on wash sales, the tax treatment of swaps and passive foreign investment companies (PFICs), the realization for tax purposes of gains/losses on certain derivative instruments, and the tax treatment of Treasury inflation-protected securities.

^(c) The difference between book-basis and tax-basis components of accumulated earnings/ (deficit) is attributable primarily to the tax treatment of defaulted securities.

For tax purposes, net capital losses may be carried over to offset future capital gains, if any. Funds are permitted to carry forward capital losses incurred in taxable years beginning after December 22, 2010 for an indefinite period, and such losses will retain their character as either short-term or long-term capital losses. As of October 31, 2015, the Strategy had a net short-term capital loss carryforward of $2,747,614 and a net long-term capital loss carryforward of $7,788,377, which may be carried forward for an indefinite period.

During the current fiscal year, permanent differences primarily due to the tax treatment of swaps and swap clearing fees, reclassifications of foreign currency

74 •  AB BOND INFLATION STRATEGY

Notes to Financial Statements

and paydown gains/losses, and the tax treatment of Treasury inflation-protected securities resulted in a net increase in undistributed net investment income and a net increase in accumulated net realized loss on investment and foreign currency transactions. These reclassifications had no effect on net assets.

NOTE I

New Accounting Pronouncement

In May 2015, the Financial Accounting Standards Board issued an Accounting Standards Update (“ASU”), ASU 2015-07, which removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the net asset value per share practical expedient. The ASU also removes the disclosure requirement for investments not valued at net asset value. The ASU is effective for annual periods beginning after December 15, 2015 and interim periods within those annual periods. At this time, management is evaluating the implications of these changes on the financial statements.

NOTE J

Subsequent Events

Management has evaluated subsequent events for possible recognition or disclosure in the financial statements through the date the financial statements are issued. Management has determined that there are no material events that would require disclosure in the Strategy’s financial statements through this date.

AB BOND INFLATION STRATEGY  • 75

Notes to Financial Statements

FINANCIAL HIGHLIGHTS

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class A
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.77			$  10.81			$  11.36			$  10.81			$  10.53
Income From Investment Operations
Net investment income(a)(b)		.08			.17			.09			.13			.38
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(.31	)		(.04	)		(.57	)		.56			.21
Net increase (decrease) in net asset value from operations		(.23	)		.13			(.48	)		.69			.59
Less: Dividends and Distributions
Dividends from net investment income		(.10	)		(.17	)		(.07	)		(.14	)		(.31	)
Distributions from net realized gain on investment transactions		– 0	–		– 0	–		(.00	)(c)		– 0	–		– 0	–
Total dividends and distributions		(.10	)		(.17	)		(.07	)		(.14	)		(.31	)
Net asset value, end of period		$  10.44			$  10.77			$  10.81			$  11.36			$  10.81
Total Return
Total investment return based on net asset value(d)		(2.18	)%		1.16	%		(4.23	)%		6.41	%		5.75	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$13,660			$15,860			$23,358			$17,627			$9,732
Ratio to average net assets of:
Expenses, net of waivers/reimbursements(e)		.88	%		.81	%		.80	%		.81	%		.78	%
Expenses, before waivers/reimbursements(e)		1.36	%		1.15	%		1.18	%		1.25	%		1.87	%
Net investment income(b)		.75	%		1.57	%		.80	%		1.20	%		3.59	%
Portfolio turnover rate**		51	%		77	%		93	%		32	%		38	%

See footnote summary on page 84.

76 •  AB BOND INFLATION STRATEGY

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class C
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.64			$  10.71			$  11.28			$  10.78			$  10.50
Income From Investment Operations
Net investment income(a)(b)		.00	(c)		.07			.00	(c)		.04			.30
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(.31	)		(.01	)		(.56	)		.56			.22
Net increase (decrease) in net asset value from operations		(.31	)		.06			(.56	)		.60			.52
Less: Dividends and Distributions
Dividends from net investment income		(.06	)		(.13	)		(.01	)		(.10	)		(.24	)
Distributions from net realized gain on investment transactions		– 0	–		– 0	–		(.00	)(c)		– 0	–		– 0	–
Total dividends and distributions		(.06	)		(.13	)		(.01	)		(.10	)		(.24	)
Net asset value, end of period		$  10.27			$  10.64			$  10.71			$  11.28			$  10.78
Total Return
Total investment return based on net asset value(d)		(2.93	)%		.50	%		(4.98	)%		5.61	%		5.03	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$2,679			$3,596			$5,845			$7,991			$6,782
Ratio to average net assets of:
Expenses, net of waivers/reimbursements(e)		1.58	%		1.51	%		1.51	%		1.51	%		1.49	%
Expenses, before waivers/reimbursements(e)		2.07	%		1.86	%		1.86	%		1.96	%		2.84	%
Net investment income(b)		.06	%		.70	%		.01	%		.39	%		2.82	%
Portfolio turnover rate**		51	%		77	%		93	%		32	%		38	%

See footnote summary on page 84.

AB BOND INFLATION STRATEGY  • 77

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Advisor Class
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.79			$  10.82			$  11.39			$  10.83			$  10.55
Income From Investment Operations
Net investment income(a)(b)		.13			.19			.06			.16			.39
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(.33	)		(.03	)		(.52	)		.56			.24
Net increase (decrease) in net asset value from operations		(.20	)		.16			(.46	)		.72			.63
Less: Dividends and Distributions
Dividends from net investment income		(.13	)		(.19	)		(.11	)		(.16	)		(.35	)
Distributions from net realized gain on investment transactions		– 0	–		– 0	–		(.00	)(c)		– 0	–		– 0	–
Total dividends and distributions		(.13	)		(.19	)		(.11	)		(.16	)		(.35	)
Net asset value, end of period		$  10.46			$  10.79			$  10.82			$  11.39			$  10.83
Total Return
Total investment return based on net asset value(d)		(1.90	)%		1.50	%		(4.06	)%		6.69	%		6.07	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$18,343			$16,144			$7,969			$5,499			$2,325
Ratio to average net assets of:
Expenses, net of waivers/reimbursements(e)		.58	%		.52	%		.51	%		.51	%		.49	%
Expenses, before waivers/reimbursements(e)		1.06	%		.86	%		.87	%		.95	%		1.80	%
Net investment income(b)		1.23	%		1.77	%		.54	%		1.52	%		3.70	%
Portfolio turnover rate**		51	%		77	%		93	%		32	%		38	%

See footnote summary on page 84.

78 •  AB BOND INFLATION STRATEGY

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class R
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.78			$  10.81			$  11.34			$  10.79			$  10.50
Income From Investment Operations
Net investment income (loss)(a)(b)		(.08	)		.14			.06			.11			.43
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(.19	)		(.02	)		(.57	)		.55			.15
Net increase (decrease) in net asset value from operations		(.27	)		.12			(.51	)		.66			.58
Less: Dividends and Distributions
Dividends from net investment income		(.07	)		(.15	)		(.02	)		(.11	)		(.29	)
Distributions from net realized gain on investment transactions		– 0	–		– 0	–		(.00	)(c)		– 0	–		– 0	–
Total dividends and distributions		(.07	)		(.15	)		(.02	)		(.11	)		(.29	)
Net asset value, end of period		$  10.44			$  10.78			$  10.81			$  11.34			$  10.79
Total Return
Total investment return based on net asset value(d)		(2.49	)%		1.10	%		(4.51	)%		6.18	%		5.59	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$20			$230			$209			$539			$488
Ratio to average net assets of:
Expenses, net of waivers/reimbursements(e)		1.06	%		1.01	%		1.01	%		1.01	%		.98	%
Expenses, before waivers/reimbursements(e)		1.50	%		1.40	%		1.44	%		1.60	%		2.16	%
Net investment income (loss)(b)		(.68	)%		1.26	%		.49	%		.98	%		4.16	%
Portfolio turnover rate**		51	%		77	%		93	%		32	%		38	%

See footnote summary on page 84.

AB BOND INFLATION STRATEGY  • 79

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class K
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.77			$  10.80			$  11.35			$  10.79			$  10.50
Income From Investment Operations
Net investment income(a)(b)		.07			.17			.09			.13			.28
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(.31	)		(.03	)		(.57	)		.57			.31
Net increase (decrease) in net asset value from operations		(.24	)		.14			(.48	)		.70			.59
Less: Dividends and Distributions
Dividends from net investment income		(.11	)		(.17	)		(.07	)		(.14	)		(.30	)
Distributions from net realized gain on investment transactions		– 0	–		– 0	–		(.00	)(c)		– 0	–		– 0	–
Total dividends and distributions		(.11	)		(.17	)		(.07	)		(.14	)		(.30	)
Net asset value, end of period		$  10.42			$  10.77			$  10.80			$  11.35			$  10.79
Total Return
Total investment return based on net asset value(d)		(2.24	)%		1.31	%		(4.26	)%		6.51	%		5.75	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$1,616			$2,219			$1,981			$2,007			$566
Ratio to average net assets of:
Expenses, net of waivers/reimbursements(e)		.83	%		.76	%		.76	%		.77	%		.75	%
Expenses, before waivers/reimbursements(e)		1.17	%		1.07	%		1.12	%		1.27	%		2.39	%
Net investment income(b)		.70	%		1.57	%		.80	%		1.19	%		2.76	%
Portfolio turnover rate**		51	%		77	%		93	%		32	%		38	%

See footnote summary on page 84.

80 •  AB BOND INFLATION STRATEGY

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class I
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.73			$  10.77			$  11.33			$  10.78			$  10.51
Income From Investment Operations
Net investment income (loss)(a)(b)		(.06	)		.22			.10			.18			.27
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(.14	)		(.06	)		(.55	)		.53			.36
Net increase (decrease) in net asset value from operations		(.20	)		.16			(.45	)		.71			.63
Less: Dividends and Distributions
Dividends from net investment income		(.15	)		(.20	)		(.11	)		(.16	)		(.36	)
Distributions from net realized gain on investment transactions		– 0	–		– 0	–		(.00	)(c)		– 0	–		– 0	–
Total dividends and distributions		(.15	)		(.20	)		(.11	)		(.16	)		(.36	)
Net asset value, end of period		$  10.38			$  10.73			$  10.77			$  11.33			$  10.78
Total Return
Total investment return based on net asset value(d)		(1.88	)%		1.52	%		(4.00	)%		6.65	%		6.11	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$265			$841			$2,631			$267			$76
Ratio to average net assets of:
Expenses, net of waivers/reimbursements(e)		.57	%		.51	%		.50	%		.52	%		.50	%
Expenses, before waivers/reimbursements(e)		.76	%		.69	%		.83	%		.95	%		1.91	%
Net investment income (loss)(b)		(.50	)%		2.06	%		1.10	%		1.54	%		3.67	%
Portfolio turnover rate**		51	%		77	%		93	%		32	%		38	%

See footnote summary on page 84.

AB BOND INFLATION STRATEGY  • 81

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class 1
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.71			$  10.76			$  11.33			$  10.78			$  10.51
Income From Investment Operations
Net investment income(a)(b)		.10			.19			.12			.16			.34
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(.32	)		(.04	)		(.58	)		.55			.28
Net increase (decrease) in net asset value from operations		(.22	)		.15			(.46	)		.71			.62
Less: Dividends and Distributions
Dividends from net investment income		(.14	)		(.20	)		(.11	)		(.16	)		(.35	)
Distributions from net realized gain on investment transactions		– 0	–		– 0	–		(.00	)(c)		– 0	–		– 0	–
Total dividends and distributions		(.14	)		(.20	)		(.11	)		(.16	)		(.35	)
Net asset value, end of period		$  10.35			$  10.71			$  10.76			$  11.33			$  10.78
Total Return
Total investment return based on net asset value(d)		(2.04	)%		1.38	%		(4.08	)%		6.63	%		6.01	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$253,402			$288,565			$315,187			$193,864			$105,201
Ratio to average net assets of:
Expenses, net of waivers/reimbursements(e)		.68	%		.61	%		.60	%		.61	%		.58	%
Expenses, before waivers/reimbursements(e)		.87	%		.77	%		.81	%		.96	%		1.20	%
Net investment income(b)		.98	%		1.75	%		1.05	%		1.41	%		3.24	%
Portfolio turnover rate**		51	%		77	%		93	%		32	%		38	%

See footnote summary on page 84.

82 •  AB BOND INFLATION STRATEGY

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class 2
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.71			$  10.75			$  11.33			$  10.77			$  10.51
Income From Investment Operations
Net investment income(a)(b)		.11			.20			.12			.14			.39
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(.32	)		(.03	)		(.58	)		.59			.23
Net increase (decrease) in net asset value from operations		(.21	)		.17			(.46	)		.73			.62
Less: Dividends and Distributions
Dividends from net investment income		(.15	)		(.21	)		(.12	)		(.17	)		(.36	)
Distributions from net realized gain on investment transactions		– 0	–		– 0	–		(.00	)(c)		– 0	–		– 0	–
Total dividends and distributions		(.15	)		(.21	)		(.12	)		(.17	)		(.36	)
Net asset value, end of period		$  10.35			$  10.71			$  10.75			$  11.33			$  10.77
Total Return
Total investment return based on net asset value(d)		(1.95	)%		1.55	%		(4.06	)%		6.80	%		6.01	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$40,897			$47,314			$46,554			$47,200			$16,550
Ratio to average net assets of:
Expenses, net of waivers/reimbursements(e)		.58	%		.51	%		.51	%		.51	%		.49	%
Expenses, before waivers/reimbursements(e)		.77	%		.67	%		.71	%		.86	%		1.84	%
Net investment income(b)		1.09	%		1.87	%		1.05	%		1.36	%		3.73	%
Portfolio turnover rate**.		51	%		77	%		93	%		32	%		38	%

See footnote summary on page 84.

AB BOND INFLATION STRATEGY  • 83

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class Z
	December 11, 2014(f) to October 31, 2015
Net asset value, beginning of period		$  10.62
Income From Investment Operations
Net investment income(a)(b)		.19
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(.28	)
Net increase (decrease) in net asset value from operations		(.09	)
Less: Dividends
Dividends from net investment income		(.15	)
Net asset value, end of period		$  10.38
Total Return
Total investment return based on net asset value(d)		(.86	)%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$3,821
Ratio to average net assets of:
Expenses, net of waivers/reimbursements(e)		.61	%^
Expenses, before waivers/reimbursements(e)		.84	%^
Net investment income(b)		2.09	%^
Portfolio turnover rate**		51	%

(a) Based on average shares outstanding.

(b) Net of fees and expenses waived/reimbursed by the Adviser.

(c) Amount is less than $.005.

(d) Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Initial sales charges or contingent deferred sales charges are not reflected in the calculation of total investment return. Total return does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Total investment return calculated for a period of less than one year is not annualized.

(e) The expense ratios presented below exclude interest expense

84 •  AB BOND INFLATION STRATEGY

Financial Highlights

	Year Ended October 31,
	2015			2014			2013			2012			2011
Class A
Net of waivers/reimbursements		.80	%		.79	%		.75	%		.75	%		.75	%
Before waivers/reimbursements		1.28	%		1.13	%		1.12	%		1.18	%		1.83	%
Class C
Net of waivers/reimbursements		1.50	%		1.48	%		1.45	%		1.45	%		1.45	%
Before waivers/reimbursements		1.99	%		1.84	%		1.81	%		1.90	%		2.80	%
Advisor Class
Net of waivers/reimbursements		.50	%		.49	%		.45	%		.45	%		.45	%
Before waivers/reimbursements		.98	%		.84	%		.82	%		.89	%		1.76	%
Class R
Net of waivers/reimbursements		1.00	%		.99	%		.95	%		.95	%		.95	%
Before waivers/reimbursements		1.44	%		1.38	%		1.39	%		1.54	%		2.13	%
Class K
Net of waivers/reimbursements		.75	%		.74	%		.70	%		.70	%		.70	%
Before waivers/reimbursements		1.09	%		1.05	%		1.06	%		1.21	%		2.34	%
Class I
Net of waivers/reimbursements		.50	%		.49	%		.45	%		.45	%		.45	%
Before waivers/reimbursements		.69	%		.67	%		.78	%		.89	%		1.86	%
Class 1
Net of waivers/reimbursements		.60	%		.59	%		.55	%		.55	%		.55	%
Before waivers/reimbursements		.79	%		.74	%		.76	%		.89	%		1.18	%
Class 2
Net of waivers/reimbursements		.50	%		.49	%		.45	%		.45	%		.45	%
Before waivers/reimbursements		.69	%		.64	%		.66	%		.80	%		1.80	%
Class Z(g)
Net of waivers/reimbursements		.50	%^
Before waivers/reimbursements		.73	%^

(f) Commencement of distributions.

(g) Commenced distribution on December 11, 2014.

^ Annualized.

** The Strategy accounts for dollar roll transactions as purchases and sales.

See notes to financial statements.

AB BOND INFLATION STRATEGY  • 85

Financial Highlights

REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of AB Bond Inflation Strategy Portfolio

We have audited the accompanying statement of assets and liabilities, including the portfolio of investments, of AB Bond Inflation Strategy Portfolio (the “Fund”) (formerly AllianceBernstein Bond Inflation Strategy Portfolio), one of the portfolios constituting the AB Bond Fund, Inc. (formerly AllianceBernstein Bond Fund, Inc.) as of October 31, 2015, and the related statements of operations and cash flows for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended (including the period December 11, 2014 (commencement of distribution) to October 31, 2015 for Class Z shares). These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Fund’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of October 31, 2015, by correspondence with the custodian and others, or by other appropriate auditing procedures where replies from others were not received. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of AB Bond Inflation Strategy Portfolio, one of the portfolios constituting the AB Bond Fund, Inc., at October 31, 2015, the results of its operations and its cash flows for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended (including the period December 11, 2014 (commencement of distribution) to October 31, 2015 for Class Z shares), in conformity with U.S. generally accepted accounting principles.

New York, New York

December 30, 2015

86 •  AB BOND INFLATION STRATEGY

Report of Independent Registered Public Accounting Firm

2015 FEDERAL TAX INFORMATION

(unaudited)

For Federal income tax purposes, the following information is furnished with respect to the distributions paid by the Strategy during the taxable year ended October 31, 2015.

For foreign shareholders, 64.25% of ordinary income dividends paid may be considered to be qualifying to be taxed as interest-related dividends.

Shareholders should not use the above information to prepare their income tax returns. The information necessary to complete your income tax returns will be included with your Form 1099-DIV which will be sent to you separately in January 2016.

AB BOND INFLATION STRATEGY  • 87

BOARD OF DIRECTORS

Marshall C. Turner, Jr.⁽¹⁾, Chairman John H. Dobkin⁽¹⁾ Michael J. Downey⁽¹⁾ William H. Foulk, Jr.⁽¹⁾ D. James Guzy⁽¹⁾ Nancy P. Jacklin⁽¹⁾ Robert M. Keith, President and Chief Executive Officer Garry L. Moody⁽¹⁾ Earl D. Weiner⁽¹⁾

OFFICERS

Philip L. Kirstein, Senior Vice President and Independent Compliance Officer Paul J. DeNoon⁽²⁾, Vice President Rajen B. Jadav⁽²⁾, Vice President Shawn E. Keegan⁽²⁾, Vice President Douglas J. Peebles⁽²⁾, Vice President Greg J. Wilensky⁽²⁾, Vice President Emilie D. Wrapp, Secretary Joseph J. Mantineo, Treasurer and Chief Financial Officer Phyllis J. Clarke, Controller Vincent S. Noto, Chief Compliance Officer

Custodian and Accounting Agent State Street Bank and Trust Company State Street Corporation CCB/5 1 Iron Street Boston, MA 02210   Principal Underwriter AllianceBernstein Investments, Inc. 1345 Avenue of the Americas New York, NY 10105   Transfer Agent AllianceBernstein Investor Services, Inc. P.O. Box 786003 San Antonio, TX 78278-6003 Toll-Free (800) 221-5672 Independent Registered Public
Accounting Firm Ernst & Young LLP 5 Times Square New York, NY 10036   Legal Counsel Seward & Kissel LLP One Battery Park Plaza New York, NY 10004

(1) Member of the Audit Committee, the Governance and Nominating Committee, and the Independent Directors Committee.

(2) The day-to-day management of, and investment decisions for, the Strategy’s portfolio are made by the Adviser’s U.S. Core Fixed-Income Team. Mr. Paul J. DeNoon, Mr. Rajen B. Jadav, Mr. Shawn E. Keegan, Mr. Douglas J. Peebles and Mr. Greg J. Wilensky are the investment professionals with the most significant responsibility for the day-to-day management of the Strategy’s portfolio.

88 •  AB BOND INFLATION STRATEGY

Board of Directors

MANAGEMENT OF THE FUND

Board of Directors Information

The business and affairs of the Strategy are managed under the direction of the Board of Directors. Certain information concerning the Strategy’s Directors is set forth below.

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
INTERESTED DIRECTOR
Robert M. Keith, + 1345 Avenue of the Americas New York, NY 10105 55 (2010)	Senior Vice President of AllianceBernstein L.P. (the “Adviser”) and the head of AllianceBernstein Investments, Inc. (“ABI”) since July 2008; Director of ABI and President of the AB Mutual Funds. Previously, he served as Executive Managing Director of ABI from December 2006 to June 2008. Prior to joining ABI in 2006, Executive Managing Director of Bernstein Global Wealth Management, and prior thereto, Senior Managing Director and Global Head of Client Service and Sales of the Adviser’s institutional investment management business since 2004. Prior thereto, he was Managing Director and Head of North American Client Service and Sales in the Adviser’s institutional investment management business, with which he had been associated since prior to 2004.		110	None

AB BOND INFLATION STRATEGY  • 89

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS
Marshall C. Turner, Jr., ++ Chairman of the Board 74 (2005)	Private Investor since prior to 2010. Former Chairman and CEO of Dupont Photomasks, Inc. (components of semi-conductor manufacturing). He has extensive operating leadership and venture capital investment experience, including five interim or full-time CEO roles and prior service as general partner of institutional venture capital partnerships. He also has extensive non-profit board leadership, and currently serves on the boards of two education and science-related non-profit organizations. He has served as a director of one AB fund since 1992, and director or trustee of multiple AB funds since 2005. He has been Chairman of the AB Funds since January 2014, and the Chairman of the Independent Directors Committees of such Funds since February 2014.		110	Xilinx, Inc. (programmable logic semi-conductors) since 2007
John H. Dobkin, ++ 73 (1998)	Independent Consultant since prior to 2010. Formerly, President of Save Venice, Inc. (preservation organization) from 2001-2002; Senior Advisor from June 1999-June 2000 and President of Historic Hudson Valley (historic preservation) from December 1989-May 1999. Previously, Director of the National Academy of Design. He has served as a director or trustee of various AB Funds since 1992, and as Chairman of the Audit Committees of a number of such Funds from 2001-2008.		110	None

90 •  AB BOND INFLATION STRATEGY

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
Michael J. Downey, ++ 71 (2005)	Private Investor since prior to 2010. Formerly, managing partner of Lexington Capital, LLC (investment advisory firm) from December 1997 until December 2003. He served as a Director of The Merger Fund (registered investment company) since prior to 2010 until 2013. He served as a Director of Prospect Acquisition Corp. (financial services) from 2007 until 2009. From 1987 until 1993, Chairman and CEO of Prudential Mutual Fund Management, director of the Prudential mutual funds, and member of the Executive Committee of Prudential Securities Inc. He has served as a director or trustee of the AB Funds since 2005 and is a director and Chairman of one other registered investment company.		110	Asia Pacific Fund, Inc. (registered investment company) since prior to 2010
William H. Foulk, Jr., ++ 83 (1998)	Investment Adviser and an Independent Consultant since prior to 2010. Previously, he was Senior Manager of Barrett Associates, Inc., a registered investment adviser. He was formerly Deputy Comptroller and Chief Investment Officer of the State of New York and, prior thereto, Chief Investment Officer of the New York Bank for Savings. He has served as a director or trustee of various AB Funds since 1983, and was Chairman of the Independent Directors Committees of the AB Funds from 2003 until early February 2014. He served as Chairman of such Funds from 2003 through December 2013. He is also active in a number of mutual fund related organizations and committees.		110	None

AB BOND INFLATION STRATEGY  • 91

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
D. James Guzy, ++ 79 (2005)	Chairman of the Board of SRC Computers, Inc. (semi-conductors), with which he has been associated since prior to 2010. He served as Chairman of the Board of PLX Technology (semi-conductors) since prior to 2010 until November 2013. He was a Director of Cirrus Logic Corporation (semi-conductors) from 1984 until July 2011. He was a director of Intel Corporation (semi-conductors) from 1969 until 2008, and served as Chairman of the Finance Committee of such company for several years until May 2008. He has served as a director or trustee of one or more of the AB Funds since 1982.		110	None
Nancy P. Jacklin, ++ 67 (2006)	Professorial Lecturer at the Johns Hopkins School of Advanced International Studies (2008-2015). U.S. Executive Director of the International Monetary Fund (which is responsible for ensuring the stability of the international monetary system), (December 2002-May 2006); Partner, Clifford Chance (1992-2002); Sector Counsel, International Banking and Finance, and Associate General Counsel, Citicorp (1985-1992); Assistant General Counsel (International), Federal Reserve Board of Governors (1982-1985); and Attorney Advisor, U.S. Department of the Treasury (1973-1982). Member of the Bar of the District of Columbia and of New York; and member of the Council on Foreign Relations. She has served as a director or trustee of the AB Funds since 2006 and has been Chairman of the Governance and Nominating Committees of the Funds since August 2014.		110	None

92 •  AB BOND INFLATION STRATEGY

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
Garry L. Moody, ++ 63 (2008)	Independent Consultant. Formerly, Partner, Deloitte & Touche LLP (1995-2008) where he held a number of senior positions, including Vice Chairman, and U.S. and Global Investment Management Practice Managing Partner; President, Fidelity Accounting and Custody Services Company (1993-1995); and Partner, Ernst & Young LLP (1975-1993), where he served as the National Director of Mutual Fund Tax Services and Managing Partner of its Chicago Office Tax department. He is a member of the Trustee Advisory Board of BoardIQ, a biweekly publication focused on issues and news affecting directors of mutual funds. He has served as a director or trustee, and as Chairman of the Audit Committees, of the AB Funds since 2008.		110	None
Earl D. Weiner, ++ 76 (2007)	Of Counsel, and Partner prior to January 2007, of the law firm Sullivan & Cromwell LLP and is a former member of the ABA Federal Regulation of Securities Committee Task Force to draft editions of the Fund Director’s Guidebook. He also serves as a director or trustee of various non-profit organizations and has served as Chairman or Vice Chairman of a number of them. He has served as a director or trustee of the AB Funds since 2007 and served as Chairman of the Governance and Nominating Committees of the AB Funds from 2007 until August 2014.		110	None

AB BOND INFLATION STRATEGY  • 93

Management of the Fund

* The address for each of the Strategy’s disinterested Directors is c/o AllianceBernstein L.P., Attention: Philip L. Kirstein, 1345 Avenue of the Americas, New York, NY 10105.

** There is no stated term of office for the Strategy’s Directors.

*** The information above includes each Director’s principal occupation during the last five years and other information relating to the experience, attributes and skills relevant to each Director’s qualifications to serve as a Director, which led to the conclusion that each Director should serve as a Director for the Strategy.

+ Mr. Keith is an “interested person” of the Strategy as defined in the “40 Act”, due to his position as a Senior Vice President of the Adviser.

++ Member of the Audit Committee, the Governance and Nominating Committee and the Independent Directors Committee.

94 •  AB BOND INFLATION STRATEGY

Management of the Fund

Officer Information

Certain information concerning the Strategy’s Officers is listed below.

NAME, ADDRESS* AND AGE	PRINCIPAL POSITION(S) HELD WITH FUND	PRINCIPAL OCCUPATION DURING PAST 5 YEARS
Robert M. Keith 55	President and Chief Executive Officer	See biography above.
Philip L. Kirstein 70	Senior Vice President and Independent Compliance Officer	Senior Vice President and Independent Compliance Officer of the AB Funds, with which he has been associated since October 2004. Prior thereto, he was Of Counsel to Kirkpatrick & Lockhart, LLP from October 2003 to October 2004, and General Counsel of Merrill Lynch Investment Managers, L.P. since prior to March 2003.
Paul J. DeNoon 53	Vice President	Senior Vice President of the Adviser,** with which he has been associated since prior to 2010.
Rajen B. Jadav 40	Vice President	Vice President of the Adviser,** with which he has been associated since prior to 2010.
Shawn E. Keegan 44	Vice President	Vice President of the Adviser,** with which he has been associated since prior to 2010.
Douglas J. Peebles 50	Vice President	Senior Vice President of the Adviser,** with which he has been associated since prior to 2010.
Greg J. Wilensky 48	Vice President	Senior Vice President of the Adviser,** with which he has been associated since prior to 2010.
Emilie D. Wrapp 59	Secretary	Senior Vice President, Assistant General Counsel and Assistant Secretary of ABI,** with which she has been associated since prior to 2010.
Joseph J. Mantineo 56	Treasurer and Chief Financial Officer	Senior Vice President of AllianceBernstein Investor Services, Inc. (“ABIS”),** with which he has been associated since prior to 2010.
Phyllis J. Clarke 54	Controller	Vice President of ABIS,** with which she has been associated since prior to 2010.
Vincent S. Noto 50	Chief Compliance Officer	Senior Vice President since 2015 and Mutual Fund Chief Compliance Officer of the Adviser** since 2014. Prior thereto, he was Vice President and Director of Mutual Fund Compliance of the Adviser** since prior to 2010.

* The address for each of the Fund’s Officers is 1345 Avenue of the Americas, New York, NY 10105.

** The Adviser, ABI and ABIS are affiliates of the Strategy.

The Fund’s Statement of Additional Information (“SAI”) has additional information about the Strategy’s Directors and Officers and is available without charge upon request. Contact your financial representative or AB at 1-800-227-4618, or visit www.ABglobal.com, for a free prospectus or SAI.

AB BOND INFLATION STRATEGY  • 95

Management of the Fund

THE FOLLOWING IS NOT PART OF THE SHAREHOLDER REPORT OR THE FINANCIAL STATEMENTS

SUMMARY OF SENIOR OFFICER’S EVALUATION OF INVESTMENT ADVISORY AGREEMENT¹

The following is a summary of the evaluation of the Investment Advisory Agreement between AllianceBernstein L.P. (the “Adviser”) and AB Bond Fund, Inc. (the “Fund”) in respect of AB Bond Inflation Strategy (the “Strategy”).² The evaluation of the Investment Advisory Agreement was prepared by Philip L. Kirstein, the Senior Officer of the Fund, for the Directors of the Fund, as required by the September 1, 2004 Assurance of Discontinuance (“AoD”) between the Adviser and the New York State Attorney General (the “NYAG”). The Senior Officer’s evaluation of the Investment Advisory Agreement is not meant to diminish the responsibility or authority of the Board of Directors of the Fund to perform its duties pursuant to Section 15 of the Investment Company Act of 1940 (the “40 Act”) and applicable state law. The purpose of this summary is to provide shareholders with a synopsis of the independent evaluation of the reasonableness of the advisory fees proposed to be paid by the Strategy which was provided to the Directors in connection with their review of the proposed approval of the continuance of the Investment Advisory Agreement. The Senior Officer’s evaluation considered the following factors:

1. Advisory fees charged to institutional and other clients of the Adviser for like services;

2. Advisory fees charged by other mutual fund companies for like services;

3. Costs to the Adviser and its affiliates of supplying services pursuant to the advisory agreement, excluding any intra-corporate profit;

4. Profit margins of the Adviser and its affiliates from supplying such services;

5. Possible economies of scale as the Strategy grows larger; and

6. Nature and quality of the Adviser’s services including the performance of the Strategy.

These factors, with the exception of the first factor, are generally referred to as the “Gartenberg factors,” which were articulated by the United States Court of Appeals for the Second Circuit in 1982. Gartenberg v. Merrill Lynch Asset Management, Inc., 694 F. 2d 923 (2d Cir. 1982). On March 30, 2010, the Supreme Court held the Gartenberg decision was correct in its basic formulation of what Section 36(b) requires: to face liability under Section 36(b), “an investment adviser must charge a fee that is so disproportionately large that it bears no reasonable relationship to the services rendered and could not have been the

1 The Senior Officer’s fee evaluation was completed on October 22, 2015 and discussed with the Board of Directors on November 3-5, 2015.

2 Future references to the Fund or the Strategy do not include “AB.”

96 •  AB BOND INFLATION STRATEGY

product of arm’s length bargaining.” Jones v. Harris Associates L.P., 130 S. Ct. 1418 (2010). In Jones, the Court stated the Gartenberg approach fully incorporates the correct understanding of fiduciary duty within the context of Section 36(b) and noted with approval that “Gartenberg insists that all relevant circumstances be taken into account” and “uses the range of fees that might result from arm’s length bargaining as the benchmark for reviewing challenged fees.”³

INVESTMENT ADVISORY FEES, NET ASSETS, EXPENSE CAPS & RATIOS

The Adviser proposed that the Strategy pay the advisory fee set forth in the table below for receiving the services to be provided pursuant to the Investment Advisory Agreement. The fee schedule below, implemented in January 2004 in connection with the Adviser’s settlement with the NYAG in December 2003, is based on a master schedule that contemplates eight categories of funds with almost all funds in each category having the same advisory fee schedule.⁴

Strategy	Category	Net Assets 9/30/15 ($MM)		Advisory Fee Based on % of Average Daily Net Assets
Bond Inflation Strategy	High Income	$	339.5	0.50% on 1st $2.5 billion 0.45% on next $2.5 billion 0.40% on the balance

The Adviser is reimbursed as specified in the Investment Advisory Agreement for certain clerical, legal, accounting, administrative and other services provided to the Strategy. During the Strategy’s fiscal year ended October 31, 2014, the Adviser received $51,054 (0.012% of the Strategy’s average daily net assets) for providing such services.

The Adviser agreed to waive that portion of its advisory fees and/or reimburse the Strategy for that portion of the Strategy’s total operating expenses to the degree necessary to limit the Strategy’s expense ratios to the amounts set forth below for the Strategy’s current fiscal year. The waiver is terminable by the Adviser upon at least 60 days’ notice prior to the Strategy’s prospectus update. In addition, set forth below are the Strategy’s gross expense ratios for the most recent semi-annual period:⁵

3 Jones v. Harris at 1427.

4 Most of the AB Mutual Funds, which the Adviser manages, were affected by the Adviser’s settlement with the NYAG.

5 Semi-annual total expense ratios are unaudited.

AB BOND INFLATION STRATEGY  • 97

	Expense Cap Pursuant to Expense Limitation Undertaking6							Gross Expense Ratio7			Fiscal Year End
Strategy		Current			Effective 02/01/16
Bond Inflation Strategy8,9	Advisor Class A Class C Class R Class K Class I Class Z10 Class 1 Class 2		0.50 0.80 1.50 1.00 0.75 0.50 0.50 0.60 0.50	%  %  %  %  %  %  %  %  %		0.50 0.75 1.50 1.00 0.75 0.50 0.50 0.60 0.50	%  %  %  %  %  %  %  %  %		0.96 1.26 1.97 1.45 1.08 0.68 0.80 0.80 0.70	%  %  %  %  %  %  %  %  %	Oct. 31 (ratios as of Apr. 30, 2015)

I. ADVISORY FEES CHARGED TO INSTITUTIONAL AND OTHER CLIENTS

The advisory fees charged to investment companies which the Adviser manages and sponsors are normally higher than those charged to similar sized institutional accounts, including pension plans and sub-advised investment companies. The fee differential reflects, among other things, different services provided to such clients, and different liabilities assumed. Services provided by the Adviser to the Strategy that are not provided to non-investment company clients include providing office space and personnel to serve as Fund Officers, who among other responsibilities make the certifications required under the Sarbanes–Oxley Act of 2002, and coordinating with and monitoring the Strategy’s third party service providers such as Fund counsel, auditors, custodians, transfer agents and pricing services. The accounting, administrative, legal and compliance requirements for the Strategy are more costly than those for institutional client assets due to the greater complexities and time required for investment companies, although as previously noted, the Adviser is reimbursed for providing such services. Also, retail mutual funds managed by the Adviser are widely held and accordingly, servicing the Strategy’s investors is more time consuming and labor intensive compared to servicing institutional clients since the Adviser needs to communicate with a more extensive network of financial intermediaries and shareholders. The Adviser also believes that it incurs substantial entrepreneurial risk when offering a new mutual fund since establishing a new mutual fund requires a large upfront investment and it may take a long time for the fund to achieve profitability since the fund must be priced to scale from inception in order to be

6 The expense cap pursuant to the expense limitation undertaking for the Strategy excludes interest expense.

7 Annualized.

8 The Rule 12b-1 fee for Class A shares will bill reduced from 0.30% to 0.25%, effective on February 1, 2016. The expense cap for Class A shares will be reduced from 0.80% to 0.75%.

9 The Strategy’s expense ratios exclude interest expense of 0.06% for Advisor Class, Class A, Class C, Class R, Class K, Class I, Class 1, and Class 2 shares, and 0.07% for Class Z shares.

10 Class Z shares commenced on December 11, 2014.

98 •  AB BOND INFLATION STRATEGY

competitive and assets are acquired one account at a time. In addition, managing the cash flow of an investment company may be more difficult than that of a stable pool of assets, such as an institutional account with little cash movement in either direction, particularly if the Strategy is in net redemption and the Adviser is frequently forced to sell securities to raise cash for redemptions. However, managing a fund with positive cash flow may be easier at times than managing a stable pool of assets. Finally, in recent years, investment advisers have been sued by institutional clients and have suffered reputational damage both by the attendant publicity and outcomes other than complete victories. Accordingly, the legal and reputational risks associated with institutional accounts are greater than previously thought, although arguably still not equal to those related to the mutual fund industry.

Notwithstanding the Adviser’s view that managing an investment company is not comparable to managing other institutional accounts because the services provided are different, the Supreme Court has indicated consideration should be given to the advisory fees charged to institutional accounts with a similar investment style as the Strategy.¹¹ In addition to the AB Institutional fee schedule, set forth below is what would have been the effective advisory fee for the Strategy had the AB Institutional fee schedule been applicable to the Strategy versus the Strategy’s advisory fees based on September 30, 2015 net assets.¹²

Strategy	Net Assets 09/30/15 ($MM)		AB Institutional Fee Schedule	Effective AB Inst. Adv. Fee		Strategy Advisory Fee
Bond Inflation Strategy		$339.5	TIPS Plus 0.50% on 1st $30 million 0.20% on the balance Minimum account size: $25m		0.227%		0.500%

The Adviser provides sub-advisory investment services to certain other investment companies managed by another fund family that have a somewhat similar investment style as the Strategy. Set forth below are the advisory fee schedules of such sub-advisory relationships, their effective fees and the Strategy’s advisory fees based on the Strategy’s assets as of September 30, 2015:¹³

11 The Supreme Court stated that “courts may give such comparisons the weight that they merit in light of the similarities and differences between the services that the clients in question require, but the courts must be wary of inapt comparisons.” Among the significant differences the Supreme Court noted that may exist between services provided to mutual funds and institutional accounts are “higher marketing costs.” Jones v. Harris at 1428.

12 The Adviser has indicated that with respect to institutional accounts with assets greater than $300 million, it will negotiate a fee schedule. Discounts that are negotiated vary based upon each client relationship.

13 The Supreme Court cautioned against accepting mutual fund fee comparisons without careful scrutiny since “these comparisons are problematic because these fees, like those challenged, may not be the product of negotiations conducted at arm’s length.” Jones v. Harris at 1429.

AB BOND INFLATION STRATEGY  • 99

Strategy	Sub-advised Fund	Sub-advised Fund Fee Schedule	Sub-Advised Management Fund Effective Fee (%)	Fund Advisory Fee(%)
Bond Inflation Strategy14	Client #1	AB Sub-Advisory Fee Schedule:     0.15% of average daily net assets	0.150% (Fee to AB)		0.500%

It is fair to note that the services the Adviser provides pursuant to sub-advisory agreements are generally confined to the services related to the investment process; in other words, they are not as comprehensive as the services provided to the Strategy by the Adviser.

While it appears that the sub-advisory relationship is paying a lower fee than the Strategy, it is difficult to evaluate the relevance of such fees due to the differences in the services provided, risks involved, and other competitive factors between the Strategy and the sub-advisory relationship. There could be various business reasons why an investment adviser would be willing to provide a sub-advised relationship investment related services at a different fee level than an investment company it is sponsoring where the investment adviser is provided all the services, not just investment management service generally required by a registered investment company.

II. MANAGEMENT FEES CHARGED BY OTHER MUTUAL FUND COMPANIES FOR LIKE SERVICES.

Broadridge Financial Solutions, Inc. (“Broadridge”), an analytical service that is not affiliated with the Adviser, compared the fees charged to the Strategy with fees charged to other investment companies for similar services offered by other investment advisers_.^15,16 Broadridge’s analysis included the comparison of the Strategy’s contractual management fee, estimated at the approximate current

14 It should be noted that the advisory fee paid by the shareholders of the sub-advisory relationship is higher than the fee charged to the Strategy.

15 On June 5, 2015, Broadridge acquired the Fiduciary Services and Competitive Intelligence unit, i.e., the group responsible for providing the Strategy’s 15(c) reports, from Thomson Reuters’ Lipper division. The group that maintains Lipper’s expense and performance databases and investment classifications/objectives remains a part of Thomson Reuters’ Lipper division. Accordingly, the Strategy’s investment classification/objective continued to be determined by Lipper.

16 Broadridge does not consider average account size when constructing EGs. Funds with relatively small average account sizes tend to have higher transfer agent expense rations than comparable sized funds that have relatively large average account sizes. There are limitations to Lipper expense category data because different funds categorize expenses differently.

100 •  AB BOND INFLATION STRATEGY

asset level of the Strategy, to the median of the Strategy’s Broadridge Expense Group (“EG”) and the Strategy’s contractual management fee ranking.¹⁷

Broadridge describes an EG as a representative sample of comparable funds. Broadridge’s standard methodology for screening funds to be included in an EG entails the consideration of several fund criteria, including fund type, Lipper investment classification/objective, load type, similar 12b-1/non-12b-1 service fees, asset (size) comparability, expense components and attributes. An EG will typically consist of seven to twenty funds.

Strategy	Contractual Management Fee (%)		Broadridge EG Median (%)		Broadridge EG Rank
Bond Inflation Strategy		0.500		0.416		9/12

Broadridge also compared the Strategy’s total expense ratio to the medians of the Strategy’s EG and Broadridge Expense Universe (“EU”). The EU is a broader group compared to the EG, consisting of all funds that have the same Lipper investment classification/objective and load type as the subject Strategy.¹⁸ Pro-forma total expense ratio (italicized) is shown to reflect the Strategy’s anticipated 12b-1 fee reduction.

Strategy	Total Expense Ratio (%)19		Broadridge EG Median (%)		Broadridge EG Rank		Broadridge EU Median (%)		Broadridge EU Rank
Bond Inflation Strategy		0.790		0.813		6/12		0.813		9/22
Pro-forma		0.740		0.813		4/12		0.813		4/22

Based on this analysis, considering pro-forma information where available, the Strategy has a more favorable ranking on a total expense ratio basis than on a management fee basis.

17 The contractual management fee is calculated by Broadridge using the Strategy’s contractual management fee rate at the hypothetical asset level. The hypothetical asset level is based on the combined net assets of all classes of the Strategy, rounded up to the next $25 million. Broadridge’s total expense ratio information is based on the most recent annual report except as otherwise noted. A ranking of “1” would mean that Strategy had the lowest fee rate in the Broadridge peer group.

18 Except for asset (size) comparability, Broadridge uses the same criteria for selecting an EG when selecting an EU. Unlike the EG, the EU allows for the same adviser to be represented by more than just one fund.

19 Most recently completed fiscal year Class A share total expense ratio. The total expense ratio information provided by Broadridge was estimated by Lipper, and there may be a slight difference compared to the Adviser’s total expense ratio due to rounding.

AB BOND INFLATION STRATEGY  • 101

III. COSTS TO THE ADVISER AND ITS AFFILIATES OF SUPPLYING SERVICES PURSUANT TO THE ADVISORY FEE ARRANGEMENT, EXCLUDING ANY INTRA-CORPORATE PROFIT.

The Adviser utilizes two profitability reporting systems, which operate independently but are aligned with each other, to estimate the Adviser’s profitability in connection with investment advisory services provided to the Strategy. The Senior Officer has retained an independent consultant to provide independent advice regarding the alignment of the two profitability systems as well as the methodologies and allocations utilized by both profitability systems. See Section IV for additional discussion.

IV. PROFIT MARGINS OF THE ADVISER AND ITS AFFILIATES FOR SUPPLYING SUCH SERVICES.

The profitability information for the Strategy, prepared by the Adviser for the Board of Directors, was reviewed by the Senior Officer and the independent consultant. The Adviser’s profitability from providing investment advisory services to the Strategy increased during calendar year 2014, relative to 2013.

In addition to the Adviser’s direct profits from managing the Strategy, certain of the Adviser’s affiliates have business relationships with the Strategy and may earn a profit from providing other services to the Strategy. The courts have referred to this type of business opportunity as “fall-out benefits” to the Adviser and indicated that such benefits should be factored into the evaluation of the total relationship between the Strategy and the Adviser. Neither case law nor common business practice precludes the Adviser’s affiliates from earning a reasonable profit on this type of relationship provided the affiliates’ charges and services are competitive. These affiliates provide transfer agent and distribution related services to the Strategy and receive transfer agent fees, front-end sales loads, Rule 12b-1 payments and contingent deferred sales charges (“CDSC”). During the Strategy’s most recently completed fiscal year, ABI received from the Strategy $601, $438,801 and $319 in front-end sales charges, Rule 12b-1 and CDSC fees, respectively.²⁰

AllianceBernstein Investments, Inc. (“ABI”), an affiliate of the Adviser, is the Strategy’s principal underwriter. ABI and the Adviser have disclosed in the Strategy’s prospectus that they may make revenue sharing payments from their own resources, in addition to revenues derived from sales loads and Rule 12b-1 fees, to firms that sell shares of the Strategy. In 2014, ABI paid approximately 0.05% of the average monthly assets of the AB Mutual Funds or approximately $20.4 million for distribution services and educational support (revenue sharing payments).

20 As a result of discussions between the Board and the Adviser, ABI will reduce the Strategy’s Class A distribution service fee payment rate from 0.30% to 0.25% effective on February 1, 2016.

102 •  AB BOND INFLATION STRATEGY

Fees and reimbursements for out of pocket expenses charged by AllianceBernstein Investor Services, Inc. (“ABIS”), the affiliated transfer agent for the Strategy, are charged on a per account basis, based on the level of service provided and the class of share held by the account. ABIS also receives a fee per shareholder sub-account for each account maintained by an intermediary on an omnibus basis. During the Strategy’s most recently completed fiscal year, ABIS received $74,080 in fees from the Strategy.

V. POSSIBLE ECONOMIES OF SCALE

The Adviser has indicated that economies of scale are being shared with shareholders through pricing to scale, breakpoints, fee reductions/waivers and enhancement to services.

In May 2012, an independent consultant, retained by the Senior Officer, provided the Board of Directors information on the Adviser’s firm-wide average costs from 2005 through 2011 and the potential economies of scale. The independent consultant noted that from 2005 through 2007 the Adviser experienced significant growth in assets under management (“AUM”). During this period, operating expenses increased, in part to keep up with growth, and in part reflecting market returns. However, from 2008 through the first quarter of 2009, AUM rapidly and significantly decreased due to declines in market value and client withdrawals. When AUM rapidly decreased, some operating expenses

categories, including base compensation and office space, adjusted more slowly during this period, resulting in an increase in average costs. Since 2009, AUM has experienced less significant changes. The independent consultant noted that changes in operating expenses reflect changes in business composition and business practices in response to changes in financial markets. Finally, the independent consultant concluded that the increase in average cost and the decline in net operating margin across the Adviser since late 2008 are inconsistent with the view that there are currently reductions in average costs due to economies of scale that can be shared with the AllianceBernstein Mutual Funds managed by the Adviser through lower fees.

Previously, in February 2008, the independent consultant provided the Board of Directors an update of the Deli²¹ study on advisory fees and various fund characteristics.²² The independent consultant first reiterated the results of his previous two dimensional comparison analysis (fund size and family size) with the Board

21 The Deli study, originally published in 2002 based on 1997 data and updated for the February 2008 Presentation, may be of diminished value due to the age of the data used in the presentation and the changes experienced in the industry since 2008.

22 The Supreme Court cautioned against accepting mutual fund fee comparisons without careful scrutiny since the fees may not be the product of negotiations conducted at arm’s length. See Jones v. Harris at 1429.

AB BOND INFLATION STRATEGY  • 103

of Directors.²³ The independent consultant then discussed the results of the regression model that was utilized to study the effects of various factors on advisory fees. The regression model output indicated that the bulk of the variation in fees predicted were explained by various factors, but substantially by fund AUM, family AUM, index fund indicator and investment style. The independent consultant also compared the advisory fees of the AB Mutual Funds to similar funds managed by 19 other large asset managers, regardless of the fund size and each Adviser’s proportion of mutual fund assets to non-mutual fund assets.

VI. NATURE AND QUALITY OF THE ADVISER’S SERVICES INCLUDING THE PERFORMANCE OF THE PORTFOLIO.

With assets under management of approximately $463 billion as of September 30, 2015, the Adviser has the investment experience to manage and provide non-investment services (described in Section I) to the Strategy.

The information below shows the 1 and 3 year performance return and rankings of the Strategy²⁴ relative to its Broadridge Performance Group (“PG”) and Broadridge Performance Universe (“PU”)²⁵ for the periods ended July 31, 2015.²⁶

Strategy	Strategy Return (%)		PG Median (%)		PU Median (%)		PG Rank	PU Rank
Bond Inflation Strategy
1 year		-2.65		-2.60		-2.55	7/12	19/31
3 year		-0.88		-1.80		-1.80	2/10	5/26
5 year		2.24		2.55		2.49	6/9	15/23

23 The two dimensional analysis showed patterns of lower advisory fees for funds with larger asset sizes and funds from larger family sizes compared to funds with smaller asset sizes and funds from smaller family sizes, which according to the independent consultant is indicative of a sharing of economies of scale and scope. However, in less liquid and active markets, such is not the case, as the empirical analysis showed potential for diseconomies of scale in those markets. The empirical analysis also showed diminishing economies of scale and scope as funds surpassed a certain high level of assets.

24 The performance returns and rankings are for the Class A shares of the Strategy. The performance returns of the Strategy were provided Broadridge.

25 The Strategy’s PG is identical to the Strategy’s EG. The Strategy’s PU is not identical to the Strategy’s EU as the criteria for including/excluding a strategy in/from a PU are somewhat different from that of an EU.

26 The current Lipper investment classification/objective dictates the PG and PU throughout the life of the Strategy even if the Strategy may have had a different investment classification/objective at different points in time.

104 •  AB BOND INFLATION STRATEGY

Set forth below are the 1, 3, and 5 year and since inception net performance returns of the Strategy (in bold)²⁷ versus its benchmark.²⁸ Strategy and benchmark volatility and reward-to-variability ratio (“Sharpe Ratio”) information is also shown.²⁹

	Period Ending July 31, 2015 Annualized Net Performance
	1 Year (%)		3 Year (%)		5 Year (%)		Since Inception (%)		Volatility (%)		Sharpe (%)		Risk Period (Year)
Bond Inflation Strategy		-2.65		-0.88		2.24		2.47		4.03		0.55		5
Barclays 1-10yr TIPS Index		-1.80		-0.92		2.25		2.43		3.68		0.60		5
Inception Date: January 6, 2010

CONCLUSION:

Based on the factors discussed above the Senior Officer’s conclusion is that the proposed advisory fee for the Strategy is reasonable and within the range of what would have been negotiated at arm’s-length in light of all the surrounding circumstances. This conclusion in respect of the Strategy is based on an evaluation of all of these factors and no single factor was dispositive.

Dated: November 25, 2015

27 The performance returns and risk measures shown in the table are for the Class A shares of the Strategy.

28 The Adviser provided Strategy and benchmark performance return information for the periods through July 31, 2015.

29 Strategy and benchmark volatility and Sharpe Ratio information was obtained through Lipper LANA, a database maintained by Lipper. Volatility is a statistical measure of the tendency of a market price or yield to vary over time. A Sharpe Ratio is a risk adjusted measure of return that divides a fund’s return in excess of the riskless return by the fund’s standard deviation. A strategy with a greater volatility would be viewed as more risky than a strategy with equivalent performance but lower volatility; for that reason, a greater return would be demanded for the more risky fund. A strategy with a higher Sharpe Ratio would be viewed as better performing than a strategy with a lower Sharpe Ratio.

AB BOND INFLATION STRATEGY  • 105

THIS PAGE IS NOT PART OF THE SHAREHOLDER REPORT OR THE FINANCIAL STATEMENTS

AB FAMILY OF FUNDS

US EQUITY

US Core

Core Opportunities Fund

Select US Equity Portfolio

US Growth

Concentrated Growth Fund

Discovery Growth Fund

Growth Fund

Large Cap Growth Fund

Small Cap Growth Portfolio

US Value

Discovery Value Fund

Equity Income Fund

Growth & Income Fund

Small Cap Value Portfolio

Value Fund

INTERNATIONAL/ GLOBAL EQUITY

International/Global Core

Global Core Equity Portfolio

Global Equity & Covered Call Strategy Fund

Global Thematic Growth Fund

International Portfolio

Tax-Managed International Portfolio

International/Global Growth

International Growth Fund

International/Global Value

Asia ex-Japan Equity Portfolio

International Value Fund

FIXED INCOME

Municipal

High Income Municipal Portfolio

Intermediate California Municipal Portfolio

Intermediate Diversified Municipal Portfolio

Intermediate New York Municipal Portfolio

Municipal Bond Inflation Strategy

FIXED INCOME (continued)

Tax-Aware Fixed Income Portfolio

National Portfolio

Arizona Portfolio

California Portfolio

Massachusetts Portfolio

Michigan Portfolio

Minnesota Portfolio

New Jersey Portfolio

New York Portfolio

Ohio Portfolio

Pennsylvania Portfolio

Virginia Portfolio

Taxable

Bond Inflation Strategy

Global Bond Fund

High Income Fund

High Yield Portfolio

Intermediate Bond Portfolio

Limited Duration High Income Portfolio

Short Duration Portfolio

ALTERNATIVES

All Market Real Return Portfolio*

Credit Long/Short Portfolio

Global Real Estate Investment Fund

Long/Short Multi-Manager Fund

Multi-Manager Alternative Strategies Fund

Select US Long/Short Portfolio

Unconstrained Bond Fund

MULTI-ASSET

All Market Growth Portfolio*

All Market Income Portfolio

Emerging Markets Multi-Asset Portfolio

Global Risk Allocation Fund

106 •  AB BOND INFLATION STRATEGY

AB Family of Funds

MULTI-ASSET (continued)

Target-Date

Multi-Manager Select Retirement Allocation Fund

Multi-Manager Select 2010 Fund

Multi-Manager Select 2015 Fund

Multi-Manager Select 2020 Fund

Multi-Manager Select 2025 Fund

Multi-Manager Select 2030 Fund

Multi-Manager Select 2035 Fund

Multi-Manager Select 2040 Fund

Multi-Manager Select 2045 Fund

Multi-Manager Select 2050 Fund

Multi-Manager Select 2055 Fund

Wealth Strategies

Balanced Wealth Strategy

Conservative Wealth Strategy

Wealth Appreciation Strategy

Tax-Managed Balanced Wealth Strategy

Tax-Managed Conservative Wealth Strategy

Tax-Managed Wealth Appreciation Strategy

CLOSED-END FUNDS

AB Multi-Manager Alternative Fund

Alliance California Municipal Income Fund

AllianceBernstein Global High Income Fund

AllianceBernstein Income Fund

AllianceBernstein National Municipal Income Fund

We also offer Exchange Reserves, which serves as the money market fund exchange vehicle for the AB mutual funds. An investment in Exchange Reserves is not a deposit in a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.

Investors should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.abglobal.com or contact your AB representative. Please read the prospectus and/or summary prospectus carefully before investing.

* Prior to December 15, 2014, All Market Growth Portfolio was named Dynamic All Market Fund; All Market Real Return Portfolio was named Real Asset Strategy.

NOTES

AB BOND INLFATION STRATEGY  • 107

NOTES

108 •  AB BOND INFLATION STRATEGY

AB BOND INFLATION STRATEGY

1345 Avenue of the Americas

New York, NY 10105

800.221.5672

BIS-0151-1015                

OCT^10.31.15

ANNUAL REPORT

AB CREDIT LONG/SHORT PORTFOLIO

Investment Products Offered

• Are Not FDIC Insured

• May Lose Value

• Are Not Bank Guaranteed

Investors should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.abglobal.com or contact your AB representative. Please read the prospectus and/or summary prospectus carefully before investing.

This shareholder report must be preceded or accompanied by the Fund’s prospectus for individuals who are not current shareholders of the Fund.

You may obtain a description of the Fund’s proxy voting policies and procedures, and information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30, without charge. Simply visit AB’s website at www.abglobal.com, or go to the Securities and Exchange Commission’s (the “Commission”) website at www.sec.gov, or call AB at (800) 227-4618.

The Fund files its complete schedule of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q are available on the Commission’s website at www.sec.gov. The Fund’s Forms N-Q may also be reviewed and copied at the Commission’s Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330. AB publishes full portfolio holdings for the Fund monthly at www.abglobal.com.

AllianceBernstein Investments, Inc. (ABI) is the distributor of the AB family of mutual funds. ABI is a member of FINRA and is an affiliate of AllianceBernstein L.P., the Adviser of the funds.

The [A/B] logo is a registered service mark of AllianceBernstein and AllianceBernstein^® is a registered service mark used by permission of the owner, AllianceBernstein L.P.

December 16, 2015

Annual Report

This report provides management’s discussion of fund performance for AB Credit Long/Short Portfolio (the “Fund”) for the annual reporting period ended October 31, 2015. Effective January 20, 2015, the Fund’s name changed from AllianceBernstein Credit Long/Short Portfolio to AB Credit Long/Short Portfolio.

Investment Objectives and Policies

The Fund’s investment objective is to seek absolute return over a full market cycle. At least 80% of the Fund’s net assets will under normal circumstances be invested in long and short positions in credit-related instruments. For purposes of this 80% requirement, credit-related instruments will include any type of fixed-income security, such as corporate bonds, convertible fixed-income securities, preferred stocks, US government and agency securities, securities of foreign governments and supranational entities, mortgage-related and asset-backed securities, and loan participations. It is expected that a substantial portion of the Fund’s long and short positions will relate to fixed-income securities rated below investment grade (commonly known as “junk bonds”).

In selecting securities for purchase or sale by the Fund and securities for the Fund to take short positions in, AllianceBernstein L.P. (the “Adviser”) will attempt to take advantage of inefficiencies that it believes exist in the global debt markets. These inefficiencies arise from investor behavior, market complexity, and the investment limitations to which investors are subject. The Adviser will combine quantitative

analysis with fundamental credit and economic research in seeking to exploit these inefficiencies.

Under normal market conditions, the net exposure of the Fund (long exposure minus short exposure) will range between 150% and -150%. For example, the Fund may hold long positions in fixed-income securities with a value equal to 95% of its net assets and hold short positions equal to 75% of its net assets, resulting in 20% net long exposure. The Fund may also take long and short positions in equity securities.

Short positions may be effectuated through derivative instruments or through conventional short sales. When the Fund sells securities short, it sells a security that it does not own (but has borrowed) at its current market price in anticipation that the price of the security will decline. To complete, or close out, the short sale transaction, the Fund buys the same security in the market at a later date and returns it to the lender. The Adviser expects that the Fund’s long positions will be effectuated both through derivatives and actual purchases of fixed-income securities. The Fund may invest in fixed-income securities with a range of maturities from short- to long-term, and expects to maintain a weighted average duration of between -3 and 6 years. The Fund would have a negative duration when the Adviser expects the value of the Fund’s assets to increase as interest rates rise.

While the Fund’s investments will be focused on US dollar-denominated securities, the Fund may invest to a

AB CREDIT LONG/SHORT PORTFOLIO  • 1

lesser extent in securities denominated in foreign currencies. Fluctuations in currency exchange rates can have a dramatic impact on the returns of fixed-income securities. While the Adviser may hedge the foreign currency exposure resulting from the Fund’s security positions through the use of currency-related derivatives, it is not required to do so. The Fund may take long and short positions in currencies (or related derivatives) independent of any such security positions, including taking a position in a currency when it does not hold any securities denominated in that currency.

The Fund expects to use derivatives, such as options, futures, forwards and swaps, to a significant extent. Derivatives may provide a more efficient and economical exposure to market segments than direct investments, and may also be a more efficient way to alter the Fund’s exposure. The Fund may, for example, use credit default, interest rate and total return swaps to establish exposure to the fixed-income markets or particular fixed-income securities and, as noted above, may use currency derivatives to hedge foreign currency exposure.

The Fund may borrow money and enter into transactions such as reverse repurchase agreements that are similar to borrowings (in addition to the borrowing of securities inherent in short sale transactions) for investment purposes. As a result of these borrowing transactions and the use of derivatives, the Fund will at times be highly leveraged, with aggregate exposure (long and short) substantially in excess of its net assets.

The Fund is “non-diversified”, which means that it may concentrate its assets in a smaller number of issuers than a diversified fund.

Investment Results

The table on page 7 shows the Fund’s performance compared to its benchmark, the Bank of America Merrill Lynch (“BofA ML”) 3-Month US Treasury Bill Index, for the six- and 12-month periods ended October 31, 2015.

All share classes of the Fund underperformed the benchmark for both periods before sales charges, primarily driven by the underperformance of single-name long positions, relative to the benchmark. In particular, long positions in the securities of US sub investment-grade issuers detracted, with particular underperformance from the securities of energy, metals and mining issuers. These losses were partially offset by gains from single name shorts in the US sub investment-grade energy, metals and mining, and chemicals, as well as gains from single-name shorts in European investment-grade credits across a variety of sectors. Further, capital structure relative value trades, which involve going long one security in a company’s capital structure while at the same time going short another security in the same company’s capital structure, contributed to performance during both periods.

The Fund utilized derivatives including interest rate swaps for hedging purposes, and purchased options, Treasury futures and currency forwards for hedging and investment purposes, which detracted from performance during both periods, in absolute terms; written options and

2 •  AB CREDIT LONG/SHORT PORTFOLIO

swaptions, credit default swaps and total return swaps for hedging and investment purposes added to performance during both periods.

Market Review and Investment Strategy

Global credit markets were under pressure during the 12-month period ended October 31, 2015, with particular pressure on emerging markets and US high yield credit. Questions regarding global growth, the outlook for energy and industrial commodities, and global central bank policy all weighed on global financial markets. With the heightened volatility in the overall capital markets, the Fund’s Investment Policy Team (the “Team”) has generally maintained a

broadly neutral risk allocation; its focus remains on identifying idiosyncratic relative value opportunities.

The Team has kept the Fund’s overall positioning in Europe relatively conservative, with a modest net short exposure in select securities it believes are overvalued. With ongoing weakness in commodity prices, the Team still believes that a cautious, fundamentally-driven approach to the energy and mining sectors remains warranted, given the potential downside risks. Lastly, the Team continues to invest premium in downside hedging strategies, with a focus on limiting the Fund’s market-related downside.

AB CREDIT LONG/SHORT PORTFOLIO  • 3

DISCLOSURES AND RISKS

Benchmark Disclosure

The unmanaged Bank of America Merrill Lynch^® 3-Month US Treasury Bill Index does not reflect fees and expenses associated with the active management of a mutual fund portfolio. The BofA ML 3-Month US Treasury Bill Index measures the performance of Treasury securities maturing in 90 days. An investor cannot invest directly in an index, and its results are not indicative of the performance for any specific investment, including the Fund.

A Word About Risk

Market Risk: The value of the Fund’s assets will fluctuate as the bond or stock market fluctuates. The value of its investments may decline, sometimes rapidly and unpredictably, simply because of economic changes or other events that affect large portions of the market.

Credit Risk: An issuer or guarantor of a fixed-income security, or the counterparty to a derivatives or other contract, may be unable or unwilling to make timely payments of interest or principal, or to otherwise honor its obligations. The issuer or guarantor may default causing a loss of the full principal amount of a security. The degree of risk for a particular security may be reflected in its credit rating. There is the possibility that the credit rating of a fixed-income security may be downgraded after purchase, which may adversely affect the value of the security.

Interest Rate Risk: Changes in interest rates will affect the value of investments in fixed-income securities. When interest rates rise, the value of investments in fixed-income securities tends to fall and this decrease in value may not be offset by higher income from new investments. The Fund may be subject to a greater risk of rising interest rates due to the current period of historically low rates and the effect of government fiscal policy initiatives, including Federal Reserve actions, and market reaction to these initiatives. The current period of historically low rates is expected to end and rates are expected to begin rising in the near future. Interest rate risk is generally greater for fixed-income securities with longer maturities or durations. Duration is a measure that relates the expected price volatility of a fixed-income security to changes in interest rates. The duration of a fixed-income security may be shorter than or equal to full maturity of a fixed-income security. A fixed-income security with a duration of three years will decrease in value by approximately 3% if interest rates increase by 1%.

Below Investment Grade Securities Risk: Investments in fixed-income securities with lower ratings are subject to a higher probability that an issuer will default or fail to meet its payment obligations. These securities may be subject to greater price volatility due to such factors as specific corporate developments, negative perceptions of the junk bond market generally and less secondary market liquidity. These securities are often able to be “called” or repurchased by the issuer prior to their maturity date, forcing the Fund to reinvest the proceeds, possibly at a lower rate of return.

Inflation Risk: This is the risk that the value of assets or income from investments will be less in the future as inflation decreases the value of money. As inflation increases, the value of the Fund’s assets can decline as can the value of the Fund’s distributions. This risk is significantly greater if the Fund invests a significant portion of its assets in fixed-income securities with longer maturities.

Derivatives Risk: Derivatives may be illiquid, difficult to price, and leveraged so that small changes may produce disproportionate losses for the Fund, and may be subject to counterparty risk to a greater degree than more traditional investments.

Leverage Risk: To the extent the Fund uses leveraging techniques, its net asset value (“NAV”) may be more volatile because leverage tends to exaggerate the effect of changes in interest rates and any increase or decrease in the value of the Fund’s investments.

(Disclosures, Risks and Note about Historical Performance continued on next page)

4 •  AB CREDIT LONG/SHORT PORTFOLIO

Disclosures and Risks

DISCLOSURES AND RISKS

(continued from previous page)

Short Sale Risk: Short sales involve the risk that the Fund will incur a loss by subsequently buying a security at a higher price than the price at which it sold the security. The amount of such loss is theoretically unlimited, as it will be based on the increase in value of the security sold short. In contrast, the risk of loss from a long position is limited to the Fund’s investment in the security, because the price of the security cannot fall below zero. The Fund may not always be able to close out a short position on favorable terms.

Foreign (Non-US) Risk: Investments in securities of non-US issuers may involve more risk than those of US issuers.

These securities may fluctuate more widely in price and may be less liquid due to adverse market, economic, political, regulatory or other factors.

Emerging Market Risk: Investments in emerging market countries may have more risk because the markets are less developed and less liquid as well as being subject to increased economic, political, regulatory or other uncertainties.

Currency Risk: Fluctuations in currency exchange rates may negatively affect the value of the Fund’s investments or reduce its returns.

Diversification Risk: The Fund may have more risk because it is “non-diversified”, meaning that it can invest more of its assets in a smaller number of issuers. Accordingly, changes in the value of a single security may have a more significant effect, either negative or positive, on the Fund’s NAV.

Liquidity Risk: Liquidity risk occurs when certain investments become difficult to purchase or sell. Difficulty in selling less liquid securities may result in sales at disadvantageous prices affecting the value of your investment in the Fund. Causes of liquidity risk may include low trading volumes, large positions and heavy redemptions of Fund shares. Over recent years liquidity risk has also increased because the capacity of dealers in the secondary market for fixed-income securities to make markets in these securities has decreased, even as the overall bond market has grown significantly, due to, among other things, structural changes, additional regulatory requirements and capital and risk restraints that have led to reduced inventories. Liquidity risk may be higher in a rising interest rate environment, when the value and liquidity of fixed-income securities generally go down.

Management Risk: The Fund is subject to management risk because it is an actively-managed investment fund. The Adviser will apply its investment techniques and risk analyses in making investment decisions, but there is no guarantee that its techniques will produce the intended results.

These risks are fully discussed in the Fund’s prospectus. As with all investments, you may lose money by investing in the Fund.

An Important Note About Historical Performance

The investment return and principal value of an investment in the Fund will fluctuate, so that shares, when redeemed, may be worth more or less than their original cost. Performance shown on the following pages represents past performance and does not guarantee future results. Current performance may be lower or higher than the performance information shown. You may obtain performance information current to the most recent month-end by visiting www.abglobal.com. The Fund has been in operation only for a short period of time, and therefore has a very limited historical performance period. This limited performance period is unlikely to be representative of the performance the Fund will achieve over a longer period.

(Disclosures, Risks and Note about Historical Performance continued on next page)

AB CREDIT LONG/SHORT PORTFOLIO  • 5

Disclosures and Risks

DISCLOSURES AND RISKS

(continued from previous page)

All fees and expenses related to the operation of the Fund have been deducted. NAV returns do not reflect sales charges; if sales charges were reflected, the Fund’s quoted performance would be lower. SEC returns reflect the applicable sales charges for each share class: a 4.25% maximum front-end sales charge for Class A shares and a 1% 1-year contingent deferred sales charge for Class C shares. Returns for the different share classes will vary due to different expenses associated with each class. Performance assumes reinvestment of distributions and does not account for taxes.

6 •  AB CREDIT LONG/SHORT PORTFOLIO

Disclosures and Risks

HISTORICAL PERFORMANCE

THE FUND VS. ITS BENCHMARK PERIODS ENDED OCTOBER 31, 2015 (unaudited)	NAV Returns
	6 Months		12 Months
AB Credit Long/Short Portfolio*
Class A		-0.30%		-0.75%
Class C		-0.71%		-1.55%
Advisor Class†		-0.20%		-0.55%
BofA ML 3-Month US Treasury Bill Index		0.01%		0.02%
*    The returns shown are based on net asset values calculated for shareholder transactions and may differ from the returns shown in the Financial Highlights, which reflects adjustments made to the net asset values in accordance with accounting principles generally accepted in the United States of America. †     Please note that these share classes are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Fund.

GROWTH OF A $10,000 INVESTMENT IN THE FUND

5/7/14^* TO 10/31/15 (unaudited)

This chart illustrates the total value of an assumed $10,000 investment in AB Credit Long/Short Portfolio Class A shares (from 5/7/14* to 10/31/15) as compared to the performance of the Fund’s benchmark. The chart reflects the deduction of the maximum 4.25% sales charge from the initial $10,000 investment in the Fund and assumes the reinvestment of dividends and capital gains distributions.

* Inception date: 5/7/2014.

See Disclosures, Risks and Note about Historical Performance on pages 4-6.

(Historical Performance continued on next page)

AB CREDIT LONG/SHORT PORTFOLIO  • 7

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

AVERAGE ANNUAL RETURNS AS OF OCTOBER 31, 2015 (unaudited)
	NAV Returns			SEC Returns (reflects applicable sales charges)			SEC Yields*
Class A Shares								-4.19	%
1 Year		-0.75	%		-4.93	%
Since Inception†		-0.12	%		-2.98	%
Class C Shares								-5.13	%
1 Year		-1.55	%		-2.53	%
Since Inception†		-0.90	%		-0.90	%
Advisor Class Shares‡								-4.14	%
1 Year		-0.55	%		-0.55	%
Since Inception†		0.10	%		0.10	%

The Fund’s prospectus fee table shows the Fund’s total annual operating expense ratios as 4.29%, 6.31% and 5.37% for Class A, Class C and Advisor Class shares, respectively, gross of any fee waivers or expense reimbursements. Contractual fee waivers and/or expense reimbursements limit the Fund’s annual operating expense ratios exclusive of interest expense, dividend expense, borrowing costs and brokerage expense on securities sold short to 1.35%, 2.10% and 1.10% for Class A, Class C and Advisor Class shares, respectively. These waivers/reimbursements may not be terminated before January 29, 2016 and may be extended by the Adviser for additional one-year terms. Absent reimbursements or waivers, performance would have been lower. The Financial Highlights section of this report sets forth expense ratio data for the current reporting period; the expense ratios shown above may differ from the expense ratios in the Financial Highlights sections since they are based on different time periods.

* SEC yields are calculated based on SEC guidelines for the 30-day period ended October 31, 2015.

^†  Inception date: 5/7/2014.

^‡  Advisor Class shares are offered at NAV to eligible investors and their SEC returns are the same as their NAV returns. Please note that Advisor Class shares are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Fund. The inception date is listed above.

See Disclosures, Risks and Note about Historical Performance on pages 4-6.

(Historical Performance continued on next page)

8 •  AB CREDIT LONG/SHORT PORTFOLIO

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

SEC AVERAGE ANNUAL RETURNS AS OF THE MOST RECENT CALENDAR QUARTER-END SEPTEMBER 30, 2015 (unaudited)
	SEC Returns (reflects applicable sales charges)
Class A Shares
1 Year		-4.49	%
Since Inception†		-3.44	%
Class C Shares
1 Year		-1.84	%
Since Inception†		-1.10	%
Advisor Class Shares‡
1 Year		0.14	%
Since Inception†		-0.11	%

^†  Inception date: 5/7/2014.

^‡  Advisor Class shares are offered at NAV to eligible investors and their SEC returns are the same as their NAV returns. Please note that Advisor Class shares are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Fund. The inception date is listed above.

See Disclosures, Risks and Note about Historical Performance on pages 4-6.

AB CREDIT LONG/SHORT PORTFOLIO  • 9

Historical Performance

EXPENSE EXAMPLE

(unaudited)

As a shareholder of a mutual fund, you may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, contingent deferred sales charges on redemptions and (2) ongoing costs, including management fees; distribution (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period as indicated below.

Actual Expenses

The table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed annual rate of return of 5% before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds by comparing this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), or contingent deferred sales charges on redemptions. Therefore, the hypothetical example is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Beginning Account Value May 1, 2015		Ending Account Value October 31, 2015		Expenses Paid During Period*		Annualized Expense Ratio*
Class A
Actual	$	1,000	$	997.00	$	27.18		5.40	%
Hypothetical**	$	1,000	$	997.98	$	27.19		5.40	%
Class C
Actual	$	1,000	$	992.90	$	30.79		6.13	%
Hypothetical**	$	1,000	$	994.30	$	30.81		6.13	%
Advisor Class
Actual	$	1,000	$	998.00	$	25.73		5.11	%
Hypothetical**	$	1,000	$	999.45	$	25.75		5.11	%

* Expenses are equal to the classes’ annualized expense ratios multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).

** Assumes 5% annual return before expenses.

10 •  AB CREDIT LONG/SHORT PORTFOLIO

Expense Example

PORTFOLIO SUMMARY

October 31, 2015 (unaudited)

PORTFOLIO STATISTICS

Net Assets ($mil): $21.3

SECTOR BREAKDOWN^*

	Long			Short
Bank Loans		0.6	%		—	%
Collateralized Mortgage Obligations		1.7			—
Common Stocks		2.3			—
Corporates – Investment Grade		24.7			-21.9
Corporates – Non-Investment Grade		39.1			-31.8
Emerging Markets – Corporate Bonds		1.0			—
Emerging Markets – Sovereigns		0.9			-0.8
Governments – Sovereign Agencies		2.1			—
Governments – Treasuries		0.7			—
Investment Companies		4.9			—
Options Purchased – Puts		0.1			—
Preferred Stocks		0.8			—
Quasi-Sovereigns		1.2			-1.0
Warrants		0.1			—

NET COUNTRY EXPOSURE (TOP THREE)^*

Long
United States	22.3	%
Germany	2.8
Brazil	1.9

Short
Spain	-3.3	%
Denmark	-2.0
Italy	-1.4

TEN LARGEST HOLDINGS^*

Long
Company
Volkswagen Group of America Finance LLC	2.8	%
CCO Safari II LLC	2.5
Odebrecht Finance Ltd.	2.2
BlackRock Debt Strategies Fund, Inc.	2.0
Windstream Services LLC	2.0
Teck Resources Ltd.	1.9
Lloyds Bank PLC	1.9
ArcelorMittal	1.8
Hewlett Packard Enterprise Co.	1.8
MarkWest Energy Partners LP/MarkWest Energy Finance Corp.	1.8

Short
Company
TDC A/S	-2.4	%
Odebrecht Finance Ltd.	-2.2
NXP BV/NXP Funding LLC	-2.0
United Rentals North America, Inc.	-2.0
Chubb Corp. (The)	-1.8
Rent-A-Center Inc./TX	-1.8
MPLX LP	-1.7
Kinder Morgan, Inc./DE	-1.7
CNH Industrial Finance Europe SA	-1.5
Hexion, Inc.	-1.5

* Holdings are expressed as a percentage of total net assets and may vary over time. The Fund also enters into derivative transactions, which may be used for hedging or investment purposes (see “Portfolio of Investments” section of the report for additional details).

AB CREDIT LONG/SHORT PORTFOLIO  • 11

Portfolio Summary

PORTFOLIO OF INVESTMENTS

October 31, 2015

		Principal Amount (000)		U.S. $ Value
CORPORATES – NON-INVESTMENT GRADE – 39.1%
Industrial – 32.8%
Basic – 4.0%
ArcelorMittal 6.00%, 8/05/20	U.S.$		400	$	380,750
Magnetation LLC/Mag Finance Corp. 11.00%, 5/15/18(a)(b)			35		7,700
Peabody Energy Corp. 6.00%, 11/15/18			55		9,625
10.00%, 3/15/22(c)			25		6,750
Teck Resources Ltd. 5.40%, 2/01/43			745		398,575
6.25%, 7/15/41			24		13,560
Thompson Creek Metals Co., Inc. 7.375%, 6/01/18			57		23,940
					840,900
Capital Goods – 1.0%
Berry Plastics Corp. 6.00%, 10/15/22(c)			83		86,735
Bombardier, Inc. 6.125%, 1/15/23(c)			15		11,625
7.50%, 3/15/25(c)			138		107,295
					205,655
Communications - Media – 5.0%
Cequel Communications Holdings I LLC/Cequel Capital Corp. 5.125%, 12/15/21(c)			62		59,566
CSC Holdings LLC 5.25%, 6/01/24			60		52,769
DISH DBS Corp. 5.875%, 11/15/24			66		63,129
iHeartCommunications, Inc. 6.875%, 6/15/18			104		89,440
9.00%, 9/15/22			95		77,663
10.00%, 1/15/18			35		18,550
Neptune Finco Corp. 6.625%, 10/15/25(c)			200		211,250
Univision Communications, Inc. 5.125%, 2/15/25(c)			88		86,460
Virgin Media Finance PLC 5.75%, 1/15/25(c)			200		196,500
Ziggo Bond Finance BV 5.875%, 1/15/25(c)			205		195,262
					1,050,589

12 •  AB CREDIT LONG/SHORT PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Communications - Telecommunications – 6.4%
Communications Sales & Leasing, Inc./CSL Capital LLC 6.00%, 4/15/23(c)	U.S.$		157	$	152,290
8.25%, 10/15/23			160		147,920
Frontier Communications Corp. 11.00%, 9/15/25(c)			146		153,026
Sprint Capital Corp. 8.75%, 3/15/32			80		72,000
Sprint Corp. 7.125%, 6/15/24			135		118,547
T-Mobile USA, Inc. 6.375%, 3/01/25			100		100,250
Wind Acquisition Finance SA 7.375%, 4/23/21(c)			200		201,500
Windstream Services LLC 6.375%, 8/01/23			523		414,477
					1,360,010
Consumer Cyclical - Automotive – 0.2%
Gates Global LLC/Gates Global Co. 6.00%, 7/15/22(c)			60		48,150
Consumer Cyclical - Other – 1.2%
MDC Holdings, Inc. 5.50%, 1/15/24			8		8,160
6.00%, 1/15/43			42		34,020
PulteGroup, Inc. 6.00%, 2/15/35			140		138,950
6.375%, 5/15/33			51		52,581
7.875%, 6/15/32			19		21,993
					255,704
Consumer Cyclical - Retailers – 2.8%
American Tire Distributors, Inc. 10.25%, 3/01/22(c)			100		101,000
Argos Merger Sub, Inc. 7.125%, 3/15/23(c)			149		156,822
Cash America International, Inc. 5.75%, 5/15/18			120		120,900
Neiman Marcus Group Ltd. LLC 8.75% (8.75% Cash or 9.50% PIK), 10/15/21(c)(d)			33		34,277
Party City Holdings, Inc. 6.125%, 8/15/23(c)			124		127,720
Rite Aid Corp. 6.125%, 4/01/23(c)			55		59,263
					599,982

AB CREDIT LONG/SHORT PORTFOLIO  • 13

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Consumer Non-Cyclical – 3.5%
BI-LO LLC/BI-LO Finance Corp. 8.625% (8.625% Cash or 9.375% PIK), 9/15/18(c)(d)	U.S.$		110	$	100,650
HCA, Inc. 4.25%, 10/15/19			126		129,774
Post Holdings, Inc. 7.75%, 3/15/24(c)			73		77,745
8.00%, 7/15/25(c)			77		83,545
PRA Holdings, Inc. 9.50%, 10/01/23(c)			54		60,885
Sun Products Corp. (The) 7.75%, 3/15/21(c)			48		45,000
Tenet Healthcare Corp. 6.875%, 11/15/31			110		99,000
Valeant Pharmaceuticals International, Inc. 6.125%, 4/15/25(c)			66		55,522
6.75%, 8/15/18(c)			100		96,510
					748,631
Energy – 6.4%
Antero Resources Corp. 5.125%, 12/01/22			18		16,155
6.00%, 12/01/20			89		85,440
Chesapeake Energy Corp. 3.571%, 4/15/19(e)			200		129,000
Cobalt International Energy, Inc. 2.625%, 12/01/19(f)			64		46,080
Denbury Resources, Inc. 4.625%, 7/15/23			135		90,112
Global Partners LP/GLP Finance Corp. 6.25%, 7/15/22			200		184,000
MarkWest Energy Partners LP/MarkWest Energy Finance Corp. 4.875%, 6/01/25			400		374,000
Sabine Pass Liquefaction LLC 5.625%, 3/01/25(c)			268		256,945
Transocean, Inc. 6.80%, 3/15/38			200		127,000
Whiting Petroleum Corp. 1.25%, 4/01/20(c)(f)			48		42,270
					1,351,002
Other Industrial – 1.5%
General Cable Corp. 4.50%, 11/15/29(f)(g)			85		58,066
Laureate Education, Inc. 10.00%, 9/01/19(c)			331		263,145
					321,211

14 •  AB CREDIT LONG/SHORT PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Technology – 0.6%
Avaya, Inc. 7.00%, 4/01/19(c)	U.S.$		25	$	20,313
10.50%, 3/01/21(c)			112		43,400
Energizer Holdings, Inc. 5.50%, 6/15/25(c)			67		68,340
					132,053
Transportation - Services – 0.2%
Con-way, Inc. 6.70%, 5/01/34			75		49,821
					6,963,708
Financial Institutions – 5.2%
Banking – 4.0%
ABN AMRO Bank NV 4.31%, 3/10/16(h)	EUR		71		78,270
Barclays Bank PLC 6.86%, 6/15/32(c)(h)	U.S.$		73		83,585
Credit Agricole SA 6.625%, 9/23/19(c)(h)			210		206,850
Danske Bank A/S 5.684%, 2/15/17(h)	GBP		56		87,625
Royal Bank of Scotland PLC (The) 9.50%, 3/16/22(c)	U.S.$		85		92,732
Societe Generale SA 8.00%, 9/29/25(c)(h)			200		202,823
UBS Preferred Funding Trust V Series 1 6.243%, 5/15/16(h)			94		95,175
					847,060
Finance – 0.9%
Enova International, Inc. 9.75%, 6/01/21			96		81,360
TMX Finance LLC/TitleMax Finance Corp. 8.50%, 9/15/18(c)			129		101,265
					182,625
Other Finance – 0.3%
CNG Holdings, Inc. 9.375%, 5/15/20(c)			33		16,706
iPayment, Inc. 9.50%, 12/15/19(c)			1		1,151
Series AI 9.50%, 12/15/19			11		11,771
Speedy Group Holdings Corp. 12.00%, 11/15/17(c)			55		39,600
					69,228
					1,098,913

AB CREDIT LONG/SHORT PORTFOLIO  • 15

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Utility – 1.1%
Electric – 1.1%
Calpine Corp. 7.875%, 1/15/23(c)	U.S.$		61	$	65,499
NRG Energy, Inc. 6.25%, 7/15/22			23		21,160
6.625%, 3/15/23			42		39,060
Series WI 6.25%, 5/01/24			21		18,795
Talen Energy Supply LLC 4.60%, 12/15/21			118		101,276
					245,790
Total Corporates – Non-Investment Grade (cost $8,748,638)					8,308,411
CORPORATES – INVESTMENT GRADE – 24.7%
Industrial – 18.7%
Basic – 0.4%
Newmont Mining Corp. 4.875%, 3/15/42			100		79,674
Capital Goods – 3.6%
Odebrecht Finance Ltd. 7.125%, 6/26/42(c)			800		474,000
Yamana Gold, Inc. 4.95%, 7/15/24			324		297,274
					771,274
Communications - Media – 2.5%
CCO Safari II LLC 4.908%, 7/23/25(c)			205		208,379
6.484%, 10/23/45(c)			307		318,357
					526,736
Consumer Cyclical - Automotive – 2.8%
Volkswagen Group of America Finance LLC 2.45%, 11/20/19(c)			615		588,143
Consumer Cyclical - Retailers – 1.6%
CVS Health Corp. 5.125%, 7/20/45			309		331,274
Consumer Non-Cyclical – 1.2%
Gilead Sciences, Inc. 4.75%, 3/01/46			255		257,952
Energy – 3.7%
Cenovus Energy, Inc. 4.45%, 9/15/42			135		108,619
Encana Corp. 5.15%, 11/15/41			100		78,574

16 •  AB CREDIT LONG/SHORT PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Kinder Morgan, Inc./DE Series G 7.80%, 8/01/31	U.S.$		335	$	339,409
Weatherford International Ltd./Bermuda 5.95%, 4/15/42			400		271,000
					797,602
Services – 0.7%
Amazon.com, Inc. 4.95%, 12/05/44			135		140,718
Technology – 2.2%
Hewlett Packard Enterprise Co. 6.35%, 10/15/45(c)			390		377,799
Hewlett-Packard Co. 6.00%, 9/15/41			100		96,163
					473,962
					3,967,335
Financial Institutions – 6.0%
Banking – 4.8%
Bank of America Corp. 4.25%, 10/22/26			200		200,605
BPCE SA 5.70%, 10/22/23(c)			200		214,119
Citigroup, Inc. 4.30%, 11/20/26			200		200,774
Lloyds Bank PLC 6.50%, 9/14/20(c)			350		403,885
					1,019,383
Brokerage – 0.8%
GFI Group, Inc. 8.625%, 7/19/18			155		168,175
Finance – 0.4%
HSBC Finance Capital Trust IX 5.911%, 11/30/35			100		100,100
					1,287,658
Total Corporates – Investment Grade (cost $5,588,919)					5,254,993
		Shares
INVESTMENT COMPANIES – 4.9%
Funds and Investment Trusts – 4.9%
BlackRock Corporate High Yield Fund, Inc.			30,199		313,767
BlackRock Debt Strategies Fund, Inc.			122,300		423,158
Wells Fargo Advantage Income Opportunities Fund			39,092		308,045
Total Investment Companies (cost $1,080,444)					1,044,970

AB CREDIT LONG/SHORT PORTFOLIO  • 17

Portfolio of Investments

Company		Shares		U.S. $ Value
COMMON STOCKS – 2.3%
Clear Channel Outdoor Holdings, Inc. – Class A(i)			4,650	$	34,782
DISH Network Corp. – Class A(i)			400		25,188
Dynegy, Inc.(i)			1,496		29,067
eDreams ODIGEO SA(i)			5,380		14,376
Eldorado Resorts, Inc.(i)			2,665		26,384
EMC Corp./MA			1,459		38,255
Emeco Holdings Ltd.(i)			92,500		3,609
Enova International, Inc.(i)			1,000		13,000
EP Energy Corp. – Class A(i)			1,479		8,149
General Motors Co.			1,700		59,347
Hovnanian Enterprises, Inc. – Class A(i)			2,224		4,582
International Game Technology PLC			1,678		27,217
iPayment, Inc.(i)			714		3,675
Koninklijke KPN NV			6,700		24,550
LyondellBasell Industries NV – Class A			230		21,369
MDC Holdings, Inc.			1,466		38,101
Navistar International Corp.(i)			3,120		38,376
Nortek, Inc.(i)			590		36,197
Townsquare Media, Inc. – Class A(i)			2,620		28,715
Triangle Petroleum Corp.(i)			3,670		4,404
Whiting Petroleum Corp.(i)			660		11,372
Total Common Stocks (cost $629,129)					490,715
		Principal Amount (000)
GOVERNMENTS – SOVEREIGN AGENCIES – 2.1%
Brazil – 1.1%
Petrobras Global Finance BV 5.625%, 5/20/43	U.S.$		350		229,530
United Kingdom – 1.0%
Royal Bank of Scotland Group PLC 7.50%, 8/10/20(h)			205		212,175
Total Governments – Sovereign Agencies (cost $432,434)					441,705
COLLATERALIZED MORTGAGE OBLIGATIONS – 1.7%
Non-Agency Fixed Rate – 1.7%
Alternative Loan Trust Series 2005-86CB, Class A8 5.50%, 2/25/36			86		79,938

18 •  AB CREDIT LONG/SHORT PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
CHL Mortgage Pass-Through Trust Series 2006-9, Class A11 6.00%, 5/25/36	U.S.$		84	$	77,837
GSR Mortgage Loan Trust Series 2006-9F, Class 4A1 6.50%, 10/25/36			41		35,415
Morgan Stanley Mortgage Loan Trust Series 2007-10XS, Class A2 6.25%, 7/25/47			89		64,506
Wells Fargo Mortgage Backed Securities Trust Series 2007-10, Class 1A7 6.00%, 7/25/37			33		32,919
Series 2007-2, Class 1A18 5.75%, 3/25/37			70		67,769
Total Collateralized Mortgage Obligations (cost $364,895)					358,384
QUASI-SOVEREIGNS – 1.2%
Quasi-Sovereign Bonds – 1.2%
Venezuela – 1.2%
Petroleos de Venezuela SA 6.00%, 5/16/24(c) (cost $386,125)			700		247,800
EMERGING MARKETS – CORPORATE BONDS – 1.0%
Industrial – 1.0%
Basic – 1.0%
Sappi Papier Holding GmbH 7.75%, 7/15/17(c) (cost $213,207)			200		208,000
EMERGING MARKETS – SOVEREIGNS – 0.9%
Venezuela – 0.9%
Venezuela Government International Bond 9.25%, 9/15/27 (cost $196,259)			450		196,875
		Shares
PREFERRED STOCKS – 0.8%
Financial Institutions – 0.5%
REITS – 0.5%
Public Storage Series W 5.20%			4,550		112,431

AB CREDIT LONG/SHORT PORTFOLIO  • 19

Portfolio of Investments

Company		Shares		U.S. $ Value
Industrial – 0.3%
Energy – 0.3%
Energy XXI Ltd. 5.625%			500	$	12,000
Halcon Resources Corp. 5.75%			150		24,900
Magnum Hunter Resources Corp. 8.00%			1,400		1,918
Sanchez Energy Corp. 4.875%			1,550		24,606
					63,424
Total Preferred Stocks (cost $237,016)					175,855
		Principal Amount (000)
GOVERNMENTS – TREASURIES – 0.7%
Brazil – 0.7%
Brazil Notas do Tesouro Nacional Series B 6.00%, 8/15/24 (cost $151,158)	BRL		240		154,107
BANK LOANS – 0.6%
Industrial – 0.6%
Basic – 0.1%
Magnetation LLC 12.00%, 3/07/16(j)(k)	U.S.$		38		33,544
Communications - Media – 0.5%
TWCC Holding Corp. 7.00%, 6/26/20(e)			100		99,781
Total Bank Loans (cost $136,593)					133,325
		Contracts
OPTIONS PURCHASED – PUTS – 0.1%
Options on Equities – 0.1%
Tesla Motors, Inc. Expiration: Jan 2016, Exercise Price: $ 130.00(i)(l)			11		1,155
Tesla Motors, Inc. Expiration: Jan 2016, Exercise Price: $ 190.00(i)(l)			11		11,138
					12,293
Options on Funds and Investment Trusts – 0.0%
Boardwalk Real Estate Investment Trust Expiration: Nov 2015, Exercise Price: CAD 52.00(i)(m)			1,669		484

20 •  AB CREDIT LONG/SHORT PORTFOLIO

Portfolio of Investments

Company	Contracts		U.S. $ Value
SPDR S&P 500 ETF Trust Expiration: Nov 2015, Exercise Price: $ 200.00(i)(l)		13	$	1,014
SPDR S&P 500 ETF Trust Expiration: Nov 2015, Exercise Price: $ 194.00(i)(l)		21		724
SPDR S&P 500 ETF Trust Expiration: Nov 2015, Exercise Price: $ 187.00(i)(l)		20		300
				2,522
	Notional Amount (000)
Swaptions – 0.0%
CDX-NAHY.25 RTP, Barclays Bank PLC (Buy Protection) Expiration: Nov 2015, Exercise Rate: 101.00%(i)		670		1,296
Total Options Purchased – Puts (premiums paid $49,211)				16,111
	Shares
WARRANTS – 0.1%
iPayment Holdings, Inc., expiring 12/29/22(i)(j)(k) (cost $4,988)		13,856		13,856
	Contracts
OPTIONS PURCHASED – CALLS – 0.1%
Options on Equities – 0.1%
Beazer Homes USA, Inc. Expiration: Nov 2015, Exercise Price: $ 22.00(i)(l)		21		315
Diageo PLC Expiration: Dec 2015, Exercise Price: GBP 20.00(i)(m)		7,696		1,897
iShares iBoxx High Yield Corp. Expiration: Dec 2015, Exercise Price: $ 89.00(i)(l)		119		1,190
				3,402
Options on Indices – 0.0%
EURO STOXX 50 Index Expiration: Nov 2015, Exercise Price: EUR 3,500.00(i)(m)		126		2,597

AB CREDIT LONG/SHORT PORTFOLIO  • 21

Portfolio of Investments

Company		Contracts			U.S. $ Value
Options on Funds and Investment Trusts – 0.0%
SPDR S&P 500 ETF Trust Expiration: Nov 2015, Exercise Price: $ 210.00(i)(l)			11		$	1,721
SPDR S&P 500 ETF Trust Expiration: Dec 2015, Exercise Price: $ 227.00(i)(l)			86			430
						2,151
		Notional Amount (000)
Swaptions – 0.0%
CDX-NAHY.24 RTR, Deutsche Bank AG (Sell Protection) Expiration: Nov 2015, Exercise Rate: 106.50%(i)			1,000			1,190
Total Options Purchased – Calls (premiums paid $16,385)						9,340
		Shares
SHORT-TERM INVESTMENTS – 13.0%
Investment Companies – 12.5%
AB Fixed Income Shares, Inc. – Government STIF Portfolio, 0.13%(n)(o) (cost $2,653,060)			2,653,060			2,653,060
		Principal Amount (000)
U.S. Treasury Bills – 0.5%
U.S. Treasury Bill Zero Coupon, 1/21/16(p) (cost $99,995)	U.S.$		100			99,995
Total Short-Term Investments (cost $2,753,055)						2,753,055
Total Investments Before Securities Sold Short – 93.3% (cost $20,988,456)						19,807,502
SECURITIES SOLD SHORT – (55.5)%
CORPORATES – NON-INVESTMENT GRADE – (31.8)%
Financial Institutions – (3.9)%
Banking – (2.0)%
Bankia SA 3.50%, 1/17/19(c)	EUR		(200	)		(232,201	)

22 •  AB CREDIT LONG/SHORT PORTFOLIO

Portfolio of Investments

		Principal Amount (000)			U.S. $ Value
UniCredit SpA 8.00%, 6/03/24(c)(h)	U.S.$		(200	)	$	(196,750	)
						(428,951	)
Finance – (0.9)%
iStar, Inc. 5.00%, 7/01/19			(200	)		(195,750	)
Other Finance – (1.0)%
International Personal Finance PLC 5.75%, 4/07/21(c)	EUR		(200	)		(206,734	)
						(831,435	)
Industrial – (26.4)%
Basic – (4.6)%
ArcelorMittal 2.875%, 7/06/20(c)			(300	)		(295,916	)
Chemtura Corp. 5.75%, 7/15/21	U.S.$		(200	)		(203,000	)
Hexion, Inc. 6.625%, 4/15/20			(200	)		(169,500	)
8.875%, 2/01/18			(200	)		(153,000	)
TPC Group, Inc. 8.75%, 12/15/20(c)			(200	)		(163,520	)
						(984,936	)
Capital Goods – (6.4)%
Ball Corp. 5.25%, 7/01/25			(200	)		(203,250	)
BlueLine Rental Finance Corp. 7.00%, 2/01/19(c)			(200	)		(201,750	)
Clean Harbors, Inc. 5.125%, 6/01/21			(198	)		(203,247	)
CNH Industrial Finance Europe SA Series G 2.75%, 3/18/19(c)	EUR		(300	)		(324,782	)
United Rentals North America, Inc. 6.125%, 6/15/23	U.S.$		(400	)		(417,400	)
						(1,350,429	)
Communications - Media – (1.8)%
Intelsat Jackson Holdings SA 7.50%, 4/01/21			(200	)		(180,500	)
Lamar Media Corp. 5.875%, 2/01/22			(200	)		(212,000	)
						(392,500	)
Consumer Cyclical - Automotive – (3.9)%
American Axle & Manufacturing, Inc. 6.625%, 10/15/22			(200	)		(212,500	)
Dana Holding Corp. 6.00%, 9/15/23			(200	)		(207,000	)

AB CREDIT LONG/SHORT PORTFOLIO  • 23

Portfolio of Investments

		Principal Amount (000)			U.S. $ Value
Jaguar Land Rover Automotive PLC 5.625%, 2/01/23(c)	U.S.$		(192	)	$	(197,760	)
Lear Corp. 5.375%, 3/15/24			(195	)		(202,312	)
						(819,572	)
Consumer Cyclical - Retailers – (1.8)%
Rent-A-Center Inc./TX 6.625%, 11/15/20			(400	)		(376,000	)
Consumer Non-Cyclical – (2.5)%
ACCO Brands Corp. 6.75%, 4/30/20			(200	)		(213,000	)
HCA, Inc. 5.875%, 5/01/23			(197	)		(208,820	)
Unilabs Subholding AB 8.50%, 7/15/18(c)	EUR		(100	)		(114,674	)
						(536,494	)
Energy – (1.5)%
California Resources Corp. 6.00%, 11/15/24	U.S.$		(100	)		(68,000	)
Chesapeake Energy Corp. 5.75%, 3/15/23			(200	)		(126,000	)
Sanchez Energy Corp. 7.75%, 6/15/21			(100	)		(79,500	)
Ultra Petroleum Corp. 6.125%, 10/01/24(c)			(100	)		(56,000	)
						(329,500	)
Other Industrial – (0.9)%
Unifrax I LLC/Unifrax Holding Co. 7.50%, 2/15/19(c)			(200	)		(193,000	)
Services – (1.0)%
Realogy Group LLC/Realogy Co-Issuer Corp. 4.50%, 4/15/19(c)			(200	)		(206,000	)
Technology – (2.0)%
NXP BV/NXP Funding LLC 5.75%, 2/15/21(c)			(400	)		(418,000	)
						(5,606,431	)
Utility – (1.5)%
Electric – (1.5)%
Calpine Corp. 6.00%, 1/15/22(c)			(189	)		(198,639	)
Enel SpA 6.50%, 1/10/74(c)	EUR		(100	)		(118,888	)
						(317,527	)
Total Corporates – Non-Investment Grade (proceeds $7,095,005)						(6,755,393	)

24 •  AB CREDIT LONG/SHORT PORTFOLIO

Portfolio of Investments

		Principal Amount (000)			U.S. $ Value
CORPORATES – INVESTMENT GRADE – (21.9)%
Financial Institutions – (3.5)%
Banking – (1.7)%
BNP Paribas SA 2.875%, 3/20/26(c)	EUR		(150	)	$	(168,602	)
Intesa Sanpaolo SpA 4.00%, 10/30/23(c)			(150	)		(192,530	)
						(361,132	)
Insurance – (1.8)%
Chubb Corp. (The) 6.375%, 4/15/37	U.S.$		(400	)		(384,000	)
						(745,132	)
Industrial – (18.4)%
Basic – (2.2)%
Barrick Gold Corp. 4.10%, 5/01/23			(300	)		(278,654	)
Newmont Mining Corp. 3.50%, 3/15/22			(200	)		(184,621	)
						(463,275	)
Capital Goods – (2.2)%
Odebrecht Finance Ltd. 5.25%, 6/27/29(c)			(800	)		(463,000	)
Communications - Telecommunications – (3.5)%
TDC A/S 5.625%, 2/23/23(c)	GBP		(300	)		(503,050	)
Telefonica Emisiones SAU Series G 3.987%, 1/23/23(c)	EUR		(200	)		(249,889	)
						(752,939	)
Consumer Non-Cyclical – (2.2)%
Carrefour SA 1.75%, 7/15/22(c)			(200	)		(227,914	)
Casino Guichard Perrachon SA 3.311%, 1/25/23(c)			(200	)		(233,367	)
						(461,281	)
Energy – (6.3)%
Cenovus Energy, Inc. 3.80%, 9/15/23	U.S.$		(200	)		(190,371	)
Encana Corp. 3.90%, 11/15/21			(200	)		(185,996	)
Kinder Morgan, Inc./DE 4.30%, 6/01/25			(400	)		(361,814	)
MPLX LP 4.00%, 2/15/25			(400	)		(364,985	)

AB CREDIT LONG/SHORT PORTFOLIO  • 25

Portfolio of Investments

		Principal Amount (000)			U.S. $ Value
Repsol International Finance BV 3.625%, 10/07/21(c)	EUR		(200	)	$	(241,372	)
						(1,344,538	)
Services – (1.0)%
Amazon.com, Inc. 3.80%, 12/05/24	U.S.$		(200	)		(208,699	)
Technology – (1.0)%
Hewlett-Packard Co. 4.65%, 12/09/21			(200	)		(207,832	)
						(3,901,564	)
Total Corporates – Investment Grade (proceeds $5,087,914)						(4,646,696	)
QUASI-SOVEREIGNS – (1.0)%
Quasi-Sovereign Bonds – (1.0)%
Venezuela – (1.0)%
Petroleos de Venezuela SA 5.375%, 4/12/27(c) (proceeds $357,239)			(600	)		(207,000	)
EMERGING MARKETS – SOVEREIGNS – (0.8)%
Venezuela – (0.8)%
Venezuela Government International Bond 9.375%, 1/13/34 (proceeds $163,388)			(400	)		(161,000	)
Total Securities Sold Short (proceeds $12,703,546)						(11,770,089	)
Total Investments – 37.8% (cost $8,284,909)						8,037,413
Other assets less liabilities – 62.2%						13,215,617
Net Assets – 100.0%					$	21,253,030

FUTURES (see Note D)

Type	Number of Contracts		Expiration Month		Original Value		Value at October 31, 2015		Unrealized Appreciation/ (Depreciation)
Purchased Contracts
EURO STOXX 50 Index Futures		3		December 2015	$	104,933	$	112,263	$	7,330
EURO-BUND Futures		4		December 2015		673,168		691,505		18,337
Russell 2000 Mini Futures		1		December 2015		115,412		115,830		418

26 •  AB CREDIT LONG/SHORT PORTFOLIO

Portfolio of Investments

Type	Number of Contracts		Expiration Month		Original Value		Value at October 31, 2015		Unrealized Appreciation/ (Depreciation)
Sold Contracts
S&P 500 E Mini Futures		2		December 2015	$	200,284	$	207,370	$	(7,086	)
U.S. Long Bond (CBT) Futures		8		December 2015		1,250,887		1,251,500		(613	)
U.S. T-Note 10 Yr (CBT) Futures		4		December 2015		512,377		510,750		1,627
									$	20,013

FORWARD CURRENCY EXCHANGE CONTRACTS (see Note D)

Counterparty	Contracts to Deliver (000)		In Exchange For (000)		Settlement Date		Unrealized Appreciation/ (Depreciation)
Credit Suisse International	EUR	6	USD	7		12/03/15	$	49
Deutsche Bank AG	BRL	146	USD	36		11/04/15		(1,451	)
Deutsche Bank AG	USD	38	BRL	146		11/04/15		23
Royal Bank of Scotland PLC	USD	376	GBP	245		11/10/15		1,588
Standard Chartered Bank	BRL	340	USD	87		11/04/15		(1,275	)
Standard Chartered Bank	USD	87	BRL	340		11/04/15		717
Standard Chartered Bank	BRL	243	USD	62		12/02/15		(734	)
State Street Bank & Trust Co.	DKK	365	USD	55		11/05/15		1,576
State Street Bank & Trust Co.	USD	37	DKK	242		11/05/15		(1,275	)
State Street Bank & Trust Co.	GBP	3	USD	4		11/10/15		23
State Street Bank & Trust Co.	USD	51	GBP	33		11/10/15		(212	)
State Street Bank & Trust Co.	CAD	139	USD	104		11/19/15		(2,410	)
State Street Bank & Trust Co.	BRL	185	USD	47		12/02/15		(315	)
State Street Bank & Trust Co.	EUR	82	USD	91		12/03/15		517
State Street Bank & Trust Co.	USD	2,514	EUR	2,277		12/03/15		(8,715	)
State Street Bank & Trust Co.	AUD	5	USD	3		12/18/15		– 0	–^
							$	(11,894	)

PUT OPTIONS WRITTEN (see Note D)

Description	Contracts		Exercise Price		Expiration Month		Premiums Received		U.S. $ Value
iShares iBoxx High Yield Corp.(l)		119	$	76.00		December 2015	$	4,636	$	(1,547	)
SPDR S&P 500 ETF Trust(l)		20		177.00		November 2015		1,339		(120	)
SPDR S&P 500 ETF Trust(l)		21		184.00		November 2015		944		(231	)
SPDR S&P 500 ETF Trust(l)		13		190.00		November 2015		402		(279	)
Taylor Morrison Home Corp.(l)		17		22.50		January 2016		4,557		(7,225	)
Tesla Motors, Inc.(l)		22		160.00		January 2016		31,943		(7,425	)
							$	43,821	$	(16,827	)

AB CREDIT LONG/SHORT PORTFOLIO  • 27

Portfolio of Investments

CREDIT DEFAULT SWAPTIONS WRITTEN (see Note D)

Description	Counterparty	Buy/Sell Protection		Strike Rate			Expiration Date		Notional Amount (000)		Premiums Received		Market Value
Put – CDX-NAHY Series 24, 5 Year Index	Deutsche Bank AG		Sell		101.00	%		11/18/15	$	1,000	$	594	$	(115	)
Put – CDX-NAHY Series 24, 5 Year Index	Barclays Bank PLC		Sell		98.00			11/18/15		670		603		(280	)
											$	1,197	$	(395	)

CENTRALLY CLEARED CREDIT DEFAULT SWAPS (see Note D)

Clearing Broker/(Exchange) & Referenced Obligation	Fixed Rate (Pay) Receive			Implied Credit Spread at October 31, 2015			Notional Amount (000)		Market Value			Unrealized Appreciation/ (Depreciation)
Buy Contracts
Morgan Stanley & Co. LLC/(INTRCONX):
CDX-NAHY Series 23, 5 Year Index, 12/20/19*		(5.00	)%		3.09	%	$	660	$	(51,098	)	$	(3,511	)
CDX-NAHY Series 24, 5 Year Index, 6/20/20*		(5.00	)		3.59			277		(17,537	)		(212	)
CDX-NAHY Series 24, 5 Year Index, 6/20/20*		(5.00	)		3.59			495		(31,316	)		(16,004	)
CDX-NAHY Series 25, 5 Year Index, 12/20/20*		(5.00	)		4.27			400		(14,863	)		(4,551	)
CDX-NAIG Series 23, 5 Year Index, 12/20/19*		(1.00	)		0.72			2,500		(30,696	)		8,551
iTraxx-XOVER Series 23, 5 Year, 6/20/20*		(5.00	)		3.13		EUR	180		(16,544	)		(3,221	)
iTraxx-XOVER Series 23, 5 Year, 6/20/20*		(5.00	)		3.13			720		(66,177	)		(7,765	)
Sale Contracts
Morgan Stanley & Co. LLC/(CME):
CDX-NAHY Series 23, 5 Year Index, 12/20/19*		5.00			3.09		$	495		38,323			5,345
Morgan Stanley & Co. LLC/(INTRCONX):
CDX-NAHY Series 23, 5 Year Index, 12/20/19*		5.00			3.09			165		12,775			4,534
CDX-NAHY Series 24, 5 Year Index, 6/20/20*		5.00			3.59			396		25,053			14,061
iTraxx-XOVER Series 23, 5 Year, 6/20/20*		5.00			3.13		EUR	180		16,544			1,096
iTraxx-XOVER Series 23, 5 Year, 6/20/20*		5.00			3.13			840		76,694			(3,703	)
									$	(58,842	)	$	(5,380	)

* Termination date

28 •  AB CREDIT LONG/SHORT PORTFOLIO

Portfolio of Investments

CENTRALLY CLEARED INTEREST RATE SWAPS (see Note D)

					Rate Type
Clearing Broker/ (Exchange)	Notional Amount (000)		Termination Date		Payments made by the Fund			Payments received by the Fund		Unrealized Appreciation/ (Depreciation)
Morgan Stanley & Co. LLC/(CME)	$	250		5/09/19		1.732	%		3 Month LIBOR	$	(6,345	)

CREDIT DEFAULT SWAPS (see Note D)

Swap Counterparty & Referenced Obligation	Fixed Rate (Pay) Receive			Implied Credit Spread at October 31, 2015			Notional Amount (000)		Market Value			Upfront Premiums Paid (Received)			Unrealized Appreciation/ (Depreciation)
Buy Contracts
Barclays Bank PLC:
Australia and New Zealand Banking Group Ltd., 3.75%, 3/10/17, 9/20/20*		(1.00	)%		0.78	%	$	200	$	(2,218	)	$	(3,059	)	$	841
Boyd Gaming Corp., 7.125%, 2/01/16, 12/20/20*		(5.00	)		2.42			200		(25,837	)		(20,757	)		(5,080	)
Commonwealth Bank of Australia, 4.25%, 11/10/16, 9/20/20*		(1.00	)		0.78			200		(2,227	)		(3,059	)		832
Federative Republic of Brazil, 4.25%, 1/07/25, 12/20/20*		(1.00	)		4.34			400		58,893			57,362			1,531
National Australia Bank Ltd., 3.625%, 11/08/17, 9/20/20*		(1.00	)		0.72			200		(2,783	)		(3,059	)		276
Stena Aktiebolag, 6.125%, 2/01/17, 12/20/20*		(5.00	)		5.00		EUR	170		(1,111	)		1,572			(2,683	)
Teck Resources Limited, 3.15% 1/15/17, 12/20/20*		(5.00	)		10.57		$	400		76,495			97,442			(20,947	)
Weatherford International Ltd., 4.50%, 4/15/22, 12/20/20*		(1.00	)		5.71			400		78,552			66,772			11,780
Westpac banking Corp., 4.25%, 9/22/16, 9/20/20*		(1.00	)		0.78			200		(2,219	)		(3,059	)		840

AB CREDIT LONG/SHORT PORTFOLIO  • 29

Portfolio of Investments

Swap Counterparty & Referenced Obligation	Fixed Rate (Pay) Receive			Implied Credit Spread at October 31, 2015			Notional Amount (000)		Market Value			Upfront Premiums Paid (Received)			Unrealized Appreciation/ (Depreciation)
Windstream Services, LLC, 7.875%, 11/01/17, 12/20/20*		(5.00	)%		7.54	%	$	400	$	38,334		$	56,849		$	(18,515	)
Citibank, NA:
Alcoa, Inc., 5.72%, 2/23/19, 12/20/20*		(1.00	)		2.99			200		18,252			32,436			(14,184	)
ArcelorMittal, 6.125%, 6/01/18, 12/20/20*		(1.00	)		6.04		EUR	160		37,060			24,469			12,591
Dell, Inc., 7.10%, 4/15/28, 12/20/19*		(1.00	)		2.64			200		12,453			9,021			3,432
J. C. Penney Co., Inc., 6.375%, 10/15/36, 6/20/16*		(5.00	)		0.06			100		(2,875	)		1,372			(4,247	)
Quest Diagnostics, Inc., 6.95%, 7/01/37, 12/20/20*		(1.00	)		0.79			500		(5,715	)		(1,937	)		(3,778	)
Renault, 5.625%, 3/22/17, 12/20/19*		(1.00	)		1.00		EUR	160		(233	)		– 0	–		(233	)
Republic of Colombia, 10.375%, 1/28/33, 12/20/20*		(1.00	)		2.07			400		20,055			21,460			(1,405	)
Republic of Indonesia, 6.875%, 3/09/17, 12/20/20*		(1.00	)		2.18			400		21,897			22,135			(238	)
Republic of South Africa, 5.50%, 3/09/20, 12/20/20*		(1.00	)		2.50			400		27,920			30,187			(2,267	)
Republic of Turkey, 11.875%, 1/15/30, 12/20/20*		(1.00	)		2.50			400		27,875			28,605			(730	)
Russian Federation, 7.50%, 3/31/30, 12/20/20*		(1.00	)		2.77			400		32,502			37,439			(4,937	)
Transocean, Inc., 7.375%, 4/15/18, 6/20/20*		(5.00	)		8.90			1,000		132,035			99,458			32,577
Credit Suisse International:
BellSouth Corp., 6.55% 6/15/34, 9/20/19*		(1.00	)		0.60			1,000		(15,880	)		(19,060	)		3,180
ConAgra Foods, Inc., 7.00%, 10/01/28, 12/20/21*		(1.00	)		1.05			600		2,695			(5,321	)		8,016

30 •  AB CREDIT LONG/SHORT PORTFOLIO

Portfolio of Investments

Swap Counterparty & Referenced Obligation	Fixed Rate (Pay) Receive			Implied Credit Spread at October 31, 2015			Notional Amount (000)		Market Value			Upfront Premiums Paid (Received)			Unrealized Appreciation/ (Depreciation)
Western Union Co. (The), 3.65% 8/22/18, 9/20/17*		(1.00	)%		0.32	%	$	600	$	(8,116	)	$	(5,028	)	$	(3,088	)
Deutsche Bank AG:
Lloyds Bank PLC, 1.50%, 5/02/17, 12/20/19*		(1.00	)		0.40		EUR	470		(13,441	)		(10,207	)		(3,234	)
Goldman Sachs International:
Amkor Technology, Inc., 6.625%, 6/01/21, 12/20/20*		(5.00	)		3.23		$	100		(8,777	)		(4,927	)		(3,850	)
Teck Resources Ltd., 3.15%, 1/15/17, 6/20/18*		(1.00	)		7.87			250		40,499			5,333			35,166
Teck Resources Ltd., 3.15% 1/15/17, 12/20/20*		(5.00	)		10.57			200		38,247			31,135			7,112
Transocean, Inc., 7.375%, 4/15/18, 3/20/20*		(5.00	)		8.75			320		39,133			23,410			15,723
JPMorgan Chase Bank, NA:
Kohl’s Corp., 6.25%, 12/15/17, 6/20/17*		(1.00	)		0.30			400		(4,675	)		(2,847	)		(1,828	)
Repsol, S.A., 4.875%, 2/19/19, 12/20/20*		(1.00	)		1.81		EUR	200		8,516			11,073			(2,557	)
Morgan Stanley Capital Services LLC:
ArcelorMittal, 6.125%, 6/01/18, 12/20/20*		(1.00	)		6.04			210		48,646			45,444			3,202
British Telecommunications PLC, 5.75%, 12/07/28, 12/20/20*		(1.00	)		0.78			960		(12,799	)		(10,685	)		(2,114	)
Chesapeake Energy Corp., 6.625%, 8/15/20, 9/20/20*		(5.00	)		16.40		$	200		63,868			28,621			35,247
Koninklijke KPN N.V., 7.50%, 2/04/19, 12/20/20*		(1.00	)		0.86		EUR	350		(3,158	)		(580	)		(2,578	)
Noble Corp., 4.90%, 8/01/20, 9/20/20*		(1.00	)		5.92		$	150		29,631			22,148			7,483

AB CREDIT LONG/SHORT PORTFOLIO  • 31

Portfolio of Investments

Swap Counterparty & Referenced Obligation	Fixed Rate (Pay) Receive			Implied Credit Spread at October 31, 2015			Notional Amount (000)		Market Value			Upfront Premiums Paid (Received)			Unrealized Appreciation/ (Depreciation)
United States Steel Corp., 6.65%, 6/01/37, 9/20/20*		(5.00	)%		14.87	%	$	200	$	58,109		$	14,250		$	43,859
Sale Contracts
Bank of America, NA:
Genworth Holdings, Inc., 6.515% 5/22/18, 6/20/20*		5.00			5.69			20		(446	)		820			(1,266	)
Barclays Bank PLC:
Assured Guaranty Municipal Corp., 6/20/20*		5.00			2.85			20		1,895			1,464			431
United Rentals (North America), Inc., 6.125%, 6/15/23, 9/20/20*		5.00			2.58			400		45,198			28,347			16,851
Citibank, NA:
Nabors Industries, Inc., 6.15% 2/15/18, 6/20/20*		1.00			3.89			20		(2,419	)		(2,224	)		(195	)
NRG Energy, Inc., 6.25%, 7/15/22, 6/20/19*		5.00			4.52			100		1,660			8,437			(6,777	)
Safeway, Inc., 7.25% 2/01/31, 6/20/20*		1.00			2.17			20		(1,048	)		(1,621	)		573
Staples, Inc., 2.75% 1/12/18, 6/20/20*		1.00			1.52			20		(482	)		(791	)		309
Transocean, Inc., 7.375%, 4/15/18, 6/20/20*		1.00			8.90			1,200		(332,014	)		(279,301	)		(52,713	)
Unitymedia GmbH, 6.125%, 1/15/25, 6/20/20*		5.00			1.78		EUR	90		14,764			15,335			(571	)
Weatherford International LLC, 4.50% 4/15/22, 6/20/20*		1.00			4.63		$	20		(2,932	)		(1,723	)		(1,209	)
Credit Suisse International:
AT&T, Inc., 1.60% 2/15/17, 9/20/19*		1.00			0.52			1,000		18,736			22,124			(3,388	)
Avon Products, Inc., 6.50% 3/01/19, 6/20/20*		1.00			9.14			20		(5,758	)		(3,436	)		(2,322	)

32 •  AB CREDIT LONG/SHORT PORTFOLIO

Portfolio of Investments

Swap Counterparty & Referenced Obligation	Fixed Rate (Pay) Receive			Implied Credit Spread at October 31, 2015			Notional Amount (000)		Market Value			Upfront Premiums Paid (Received)			Unrealized Appreciation/ (Depreciation)
Freeport-McMoran Inc., 3.55% 3/01/22, 6/20/20*		1.00	%		5.49	%	$	20	$	(3,491	)	$	(1,408	)	$	(2,083	)
Teck Resources Ltd., 3.15% 1/15/17, 6/20/20*		1.00			10.19			20		(6,186	)		(1,497	)		(4,689	)
Transocean Inc., 7.375% 4/15/18, 6/20/20*		1.00			8.90			20		(5,534	)		(4,194	)		(1,340	)
Western Union Co. (The), 3.65% 8/22/18, 9/20/19*		1.00			0.89			400		1,586			(4,330	)		5,916
Goldman Sachs International:
Teck Resources Ltd., 3.15%, 1/15/17, 6/20/20*		1.00			10.19			200		(61,856	)		(18,934	)		(42,922	)
JPMorgan Chase Bank, NA:
Kohl’s Corp., 6.25%, 12/15/17, 6/20/19*		1.00			0.96			400		225			(4,202	)		4,427
Morgan Stanley Capital Services LLC:
AK Steel Corp., 7.625%, 4/15/20, 9/20/20*		5.00			23.32			200		(88,952	)		(51,299	)		(37,653	)
Chesapeake Energy Corp., 6.625%, 8/15/20, 9/20/18*		5.00			13.58			200		(38,285	)		(17,567	)		(20,718	)
Chesapeake Energy Corp., 6.625%, 8/15/20, 12/20/18*		5.00			14.27			100		(21,162	)		(11,774	)		(9,388	)
									$	313,102		$	346,634		$	(33,532	)

* Termination date

AB CREDIT LONG/SHORT PORTFOLIO  • 33

Portfolio of Investments

TOTAL RETURN SWAPS (see Note D)

Counterparty & Referenced Obligation	# of Shares or Units		Rate Paid/ Received		Notional Amount (000)		Maturity Date		Unrealized Appreciation/ (Depreciation)
Receive Total Return on Reference Obligation
Morgan Stanley Capital Services LLC iBoxx $ Liquid High Yield Index		980,000		LIBOR	$	980		12/21/15	$	41,876
Pay Total Return on Reference Obligation
Bank of America, NA iBoxx $ Liquid High Yield Index		225,000		LIBOR		225		12/21/15		(2,851	)
iBoxx $ Liquid High Yield Index		610,000		LIBOR		610		12/21/15		(3,811	)
JPMorgan Chase Bank, NA iBoxx $ Liquid High Yield Index		700,000		LIBOR		700		12/21/15		(20,842	)
Morgan Stanley Capital Services LLC iBoxx $ Liquid High Yield Index		765,000		LIBOR		765		12/21/15		(9,862	)
									$	4,510

^ Less than $0.50.

(a) Security is in default and is non-income producing.

(b) Security is exempt from registration under Rule 144A of the Securities Act of 1933. This security, which represents 0.04% of net assets as of October 31, 2015, is considered illiquid and restricted.

Restricted Securities	Acquisition Date		Cost		Market Value		Percentage of Net Assets
Magnetation LLC/Mag Finance Corp. 11.00%, 5/15/18		2/19/15	$	21,437	$	7,700		0.04	%

(c) Security is exempt from registration under Rule 144A of the Securities Act of 1933. These securities are considered liquid and may be resold in transactions exempt from registration, normally to qualified institutional buyers. At October 31, 2015, the aggregate market value of these securities amounted to $1,449,116 or 6.8% of net assets.

(d) Pay-In-Kind Payments (PIK). The issuer may pay cash interest and/or interest in additional debt securities. Rates shown are the rates in effect at October 31, 2015.

(e) Floating Rate Security. Stated interest rate was in effect at October 31, 2015.

(f) Convertible security.

(g) Coupon rate adjusts periodically based upon a predetermined schedule. Stated interest rate in effect at October 31, 2015.

(h) Securities are perpetual and, thus, do not have a predetermined maturity date. The date shown, if applicable, reflects the next call date.

(i) Non-income producing security.

(j) Fair valued by the Adviser.

(k) Illiquid security.

(l) One contract relates to 100 shares.

(m) One contract relates to 1 share.

(n) To obtain a copy of the fund’s financial statements, please go to the Securities and Exchange Commission’s website at www.sec.gov, or call AB at (800) 227-4618.

34 •  AB CREDIT LONG/SHORT PORTFOLIO

Portfolio of Investments

(o) Investment in affiliated money market mutual fund. The rate shown represents the 7-day yield as of period end.

(p) Position, or a portion thereof, has been segregated to collateralize OTC derivatives outstanding.

Currency Abbreviations:

AUD – Australian Dollar

BRL – Brazilian Real

CAD – Canadian Dollar

DKK – Danish Krone

EUR – Euro

GBP – Great British Pound

USD – United States Dollar

Glossary:

CBT – Chicago Board of Trade

CDX-NAHY – North American High Yield Credit Default Swap Index

CDX-NAIG – North American Investment Grade Credit Default Swap Index

CME – Chicago Mercantile Exchange

ETF – Exchange Traded Fund

INTRCONX – Inter-Continental Exchange

LIBOR – London Interbank Offered Rates

REIT – Real Estate Investment Trust

RTP – Right to Pay

RTR – Right To Receive

SPDR – Standard & Poor’s Depository Receipt

See notes to financial statements.

AB CREDIT LONG/SHORT PORTFOLIO  • 35

Portfolio of Investments

STATEMENT OF ASSETS & LIABILITIES

October 31, 2015

Assets
Investments in securities, at value
Unaffiliated issuers (cost $18,335,395)	$	17,154,442
Affiliated issuers (cost $2,653,060)		2,653,060
Cash collateral due from broker		377,295
Foreign currencies, at value (cost $35,162)		34,957
Deposit at broker for securities sold short		12,946,051
Upfront premium paid on credit default swaps		844,520
Receivable for investment securities sold		490,546
Interest and dividends receivable		260,569
Unrealized appreciation on credit default swaps		252,195
Unrealized appreciation on total return swaps		41,876
Receivable due from Adviser		3,217
Receivable for terminated credit default swaps		10,578
Unrealized appreciation on forward currency exchange contracts		4,493
Total assets		35,073,799
Liabilities
Due to custodian		381,765
Options written, at value (premiums received $43,821)		16,827
Swaptions written, at value (premiums received $1,197)		395
Payable for securities sold short, at value (proceeds received $12,703,546)		11,770,089
Upfront premium received on credit default swaps		497,886
Collateral due to broker		360,000
Unrealized depreciation on credit default swaps		285,727
Interest expense payable		216,841
Payable for investment securities purchased		66,217
Unrealized depreciation on total return swaps		37,366
Unrealized depreciation on forward currency exchange contracts		16,387
Payable for variation margin on exchange-traded derivatives		4,916
Transfer Agent fee payable		2,919
Distribution fee payable		124
Accrued expenses		163,310
Total liabilities		13,820,769
Net Assets	$	21,253,030
Composition of Net Assets
Capital stock, at par	$	2,153
Additional paid-in capital		21,470,421
Undistributed net investment income		48,954
Accumulated net realized loss on investment and foreign currency transactions		(16,217	)
Net unrealized depreciation on investments and foreign currency denominated assets and liabilities		(252,281	)
	$	21,253,030

See notes to financial statements.

36 •  AB CREDIT LONG/SHORT PORTFOLIO

Statement of Assets & Liabilities

Net Asset Value Per Share—30 billion shares of capital stock authorized, $.001 par value

Class	Net Assets		Shares Outstanding		Net Asset Value
A	$	186,419		18,932	$	9.85	*
C	$	99,612		10,191	$	9.77
Advisor	$	20,966,999		2,124,028	$	9.87

* The maximum offering price per share for Class A shares was $10.29 which reflects a sales charge of 4.25%.

See notes to financial statements.

AB CREDIT LONG/SHORT PORTFOLIO  • 37

Statement of Assets & Liabilities

STATEMENT OF OPERATIONS

Year Ended October 31, 2015

Investment Income
Interest	$	1,147,131
Dividends
Unaffiliated issuers (net of foreign taxes withheld of $286)		92,874
Affiliated issuers		2,670
Other income		225		$	1,242,900
Expenses
Advisory fee (see Note B)		190,435
Distribution fee—Class A		339
Distribution fee—Class C		868
Transfer agency—Class A		117
Transfer agency—Class C		94
Transfer agency—Advisor Class		17,903
Custodian		135,519
Audit and tax		112,412
Administrative		53,056
Amortization of offering expenses		49,076
Registration fees		48,400
Legal		39,972
Directors’ fees		18,036
Printing		11,626
Miscellaneous		30,216
Total operating expenses (see Note B)		708,069
Interest expense		661,155
Dividend expense on securities sold short		494
Broker fee on securities sold short		94,856
Total expenses		1,464,574
Less: expenses waived and reimbursed by the Adviser (see Note B)		(474,108	)
Net expenses					990,466
Net investment income					252,434
Realized and Unrealized Gain (Loss) on Investment and Foreign Currency Transactions
Net realized gain (loss) on:
Investment transactions					(1,266,871	)
Securities sold short					1,194,862
Futures					(57,524	)
Options written					52,786
Swaptions written					96,272
Swaps					(6,797	)
Foreign currency transactions					(226,953	)
Net change in unrealized appreciation/depreciation of:
Investments					(802,990	)
Securities sold short					652,365
Futures					33,840
Options written					29,825
Swaptions written					(3,001	)
Swaps					(17,393	)
Foreign currency denominated assets and liabilities					(19,391	)
Net loss on investment and foreign currency transactions					(340,970	)
Contributions from Affiliates (see Note B)					1,338
Net Decrease in Net Assets from Operations				$	(87,198	)

See notes to financial statements.

38 •  AB CREDIT LONG/SHORT PORTFOLIO

Statement of Operations

STATEMENT OF CHANGES IN NET ASSETS

	Year Ended October 31, 2015			May 7, 2014(a) to October 31, 2014
Increase (Decrease) in Net Assets from Operations
Net investment income	$	252,434		$	197,119
Net realized gain (loss) on investment transactions and foreign currency transactions		(214,225	)		46,256
Net change in unrealized appreciation/depreciation of investments and foreign currency denominated assets and liabilities		(126,745	)		(125,536	)
Contributions from Affiliates (see Note B)		1,338			– 0	–
Net increase (decrease) in net assets from operations		(87,198	)		117,839
Dividends to Shareholders from
Net investment income
Class A		(1,069	)		(87	)
Class C		(363	)		(182	)
Advisor Class		(201,440	)		(101,727	)
Capital Stock Transactions
Net increase		522,726			21,004,531
Total increase		232,656			21,020,374
Net Assets
Beginning of period		21,020,374			– 0	–
End of period (including undistributed net investment income of $48,954 and $130,266, respectively)	$	21,253,030		$	21,020,374

(a) Commencement of operations.

See notes to financial statements.

AB CREDIT LONG/SHORT PORTFOLIO  • 39

Statement of Changes in Net Assets

NOTES TO FINANCIAL STATEMENTS

October 31, 2015

NOTE A

Significant Accounting Policies

AB Bond Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940 as an open-end management investment company. Prior to January 20, 2015, the Fund was known as AllianceBernstein Bond Fund, Inc. The Fund, which is a Maryland corporation, operates as a series company comprised of nine portfolios currently in operation: the AB Intermediate Bond Portfolio, the AB Bond Inflation Strategy Portfolio, the AB Municipal Bond Inflation Strategy Portfolio, the AB All Market Real Return Portfolio (formerly AllianceBernstein Real Asset Strategy), the AB Limited Duration High Income Portfolio, the AB Government Reserves Portfolio, the AB Tax-Aware Fixed Income Portfolio, the AB Credit Long/Short Portfolio and the AB High Yield Portfolio. They are each diversified Portfolios, with the exception of the AB Credit Long/Short Portfolio and the AB High Yield Portfolio, which are non-diversified. The AB Credit Long/Short Portfolio commenced operations on May 7, 2014. The AB High Yield Portfolio commenced operations July 15, 2014. Each Portfolio is considered to be a separate entity for financial reporting and tax purposes. This report relates only to the AB Credit Long/Short Portfolio (the “Portfolio”). Prior to January 20, 2015, the Portfolio was known as AllianceBernstein Credit Long/Short Portfolio. The Fund have authorized the issuance of Class A, Class B, Class C, Advisor Class, Class R, Class K, Class I, Class Z, Class 1 and Class 2 shares. Class B, Class R, Class K, Class I, Class Z, Class 1 and Class 2 shares are not currently offered. Class A shares are sold with a front-end sales charge of up to 4.25% for purchases not exceeding $1,000,000. With respect to purchases of $1,000,000 or more, Class A shares redeemed within one year of purchase may be subject to a contingent deferred sales charge of 1%. Class C shares are subject to a contingent deferred sales charge of 1% on redemptions made within the first year after purchase. Advisor Class shares are sold without any initial or contingent deferred sales charge and are not subject to ongoing distribution expenses. All ten classes of shares have identical voting, dividend, liquidation and other rights, except that the classes bear different distribution and transfer agency expenses. Each class has exclusive voting rights with respect to its distribution plan. The financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) which require management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements and amounts of income and expenses during the reporting period. Actual results could differ from those estimates. The Fund is an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. The following is a summary of significant accounting policies followed by the Portfolio.

1. Security Valuation

Portfolio securities are valued at their current market value determined on the basis of market quotations or, if market quotations are not readily available or are deemed unreliable, at “fair value” as determined in accordance with procedures established by and under the general supervision of the Fund’s Board of Directors (the “Board”).

40 •  AB CREDIT LONG/SHORT PORTFOLIO

Notes to Financial Statements

In general, the market values of securities which are readily available and deemed reliable are determined as follows: securities listed on a national securities exchange (other than securities listed on the NASDAQ Stock Market, Inc. (“NASDAQ”)) or on a foreign securities exchange are valued at the last sale price at the close of the exchange or foreign securities exchange. If there has been no sale on such day, the securities are valued at the last traded price from the previous day. Securities listed on more than one exchange are valued by reference to the principal exchange on which the securities are traded; securities listed only on NASDAQ are valued in accordance with the NASDAQ Official Closing Price; listed or over the counter (“OTC”) market put or call options are valued at the mid level between the current bid and ask prices. If either a current bid or current ask price is unavailable, AllianceBernstein L.P. (the “Adviser”) will have discretion to determine the best valuation (e.g. last trade price in the case of listed options); open futures are valued using the closing settlement price or, in the absence of such a price, the most recent quoted bid price. If there are no quotations available for the day of valuation, the last available closing settlement price is used; U.S. Government securities and any other debt instruments having 60 days or less remaining until maturity are generally valued at market by an independent pricing vendor, if a market price is available. If a market price is not available, the securities are valued at amortized cost. This methodology is commonly used for short term securities that have an original maturity of 60 days or less, as well as short term securities that had an original term to maturity that exceeded 60 days. In instances when amortized cost is utilized, the Valuation Committee (the “Committee”) must reasonably conclude that the utilization of amortized cost is approximately the same as the fair value of the security. Such factors the Committee will consider include, but are not limited to, an impairment of the creditworthiness of the issuer or material changes in interest rates. Fixed-income securities, including mortgage-backed and asset-backed securities, may be valued on the basis of prices provided by a pricing service or at a price obtained from one or more of the major broker-dealers. In cases where broker-dealer quotes are obtained, the Adviser may establish procedures whereby changes in market yields or spreads are used to adjust, on a daily basis, a recently obtained quoted price on a security. Swaps and other derivatives are valued daily, primarily using independent pricing services, independent pricing models using market inputs, as well as third party broker-dealers or counterparties. Investment companies are valued at their net asset value each day.

Securities for which market quotations are not readily available (including restricted securities) or are deemed unreliable are valued at fair value. Factors considered in making this determination may include, but are not limited to, information obtained by contacting the issuer, analysts, analysis of the issuer’s financial statements or other available documents. In addition, the Portfolio may use fair value pricing for securities primarily traded in non-U.S. markets because most foreign markets close well before the Portfolio value it’s securities at 4:00 p.m., Eastern Time. The earlier close of these foreign markets gives rise to the

AB CREDIT LONG/SHORT PORTFOLIO  • 41

Notes to Financial Statements

possibility that significant events, including broad market moves, may have occurred in the interim and may materially affect the value of those securities.

2. Fair Value Measurements

In accordance with U.S. GAAP regarding fair value measurements, fair value is defined as the price that the Portfolio would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP establishes a framework for measuring fair value, and a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability (including those valued based on their market values as described in Note A.1 above). Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Portfolio. Unobservable inputs reflect the Portfolio’s own assumptions about the assumptions that market participants would use in pricing the asset or liability based on the best information available in the circumstances. Each investment is assigned a level based upon the observability of the inputs which are significant to the overall valuation. The three-tier hierarchy of inputs is summarized below.

• Level 1—quoted prices in active markets for identical investments

• Level 2—other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

• Level 3—significant unobservable inputs (including the Portfolio’s own assumptions in determining the fair value of investments)

The fair value of debt instruments, such as bonds, and over-the-counter derivatives is generally based on market price quotations, recently executed market transactions (where observable) or industry recognized modeling techniques and are generally classified as Level 2. Pricing vendor inputs to Level 2 valuations may include quoted prices for similar investments in active markets, interest rate curves, coupon rates, currency rates, yield curves, option adjusted spreads, default rates, credit spreads and other unique security features in order to estimate the relevant cash flows which are then discounted to calculate fair values. If these inputs are unobservable and significant to the fair value, these investments will be classified as Level 3. In addition, non-agency rated investments are classified as Level 3.

Where readily available market prices or relevant bid prices are not available for certain equity investments, such investments may be valued based on similar publicly traded investments, movements in relevant indices since last available prices or based upon underlying company fundamentals and comparable company data (such as multiples to earnings or other multiples to equity). Where an investment is valued using an observable input, such as another publicly traded security, the investment will be classified as Level 2. If management determines that an adjustment is appropriate based on restrictions on resale, illiquidity or

42 •  AB CREDIT LONG/SHORT PORTFOLIO

Notes to Financial Statements

uncertainty, and such adjustment is a significant component of the valuation, the investment will be classified as Level 3. An investment will also be classified as Level 3 where management uses company fundamentals and other significant inputs to determine the valuation.

Options are valued using market-based inputs to models, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency, where such inputs and models are available. Alternatively the values may be obtained through unobservable management determined inputs and/or management’s proprietary models. Where models are used, the selection of a particular model to value an option depends upon the contractual terms of, and specific risks inherent in, the option as well as the availability of pricing information in the market. Valuation models require a variety of inputs, including contractual terms, market prices, measures of volatility and correlations of such inputs. Exchange traded options generally will be classified as Level 2. For options that do not trade on exchange but trade in liquid markets, inputs can generally be verified and model selection does not involve significant management judgment. Options are classified within Level 2 on the fair value hierarchy when all of the significant inputs can be corroborated to market evidence. Otherwise such instruments are classified as Level 3.

The following table summarizes the valuation of the Portfolio’s investments by the above fair value hierarchy levels as of October 31, 2015:

Investments in Securities:

Level 1

Level 2

Level 3

Total

Assets:

Corporates – Non-Investment Grade

$

– 0

–

$

8,187,511

$

120,900

$

8,308,411

Corporates – Investment Grade

– 0

–

5,254,993

– 0

–

5,254,993

Investment Companies

1,044,970

– 0

–

– 0

–

1,044,970

Common Stocks

458,881

28,159

3,675

490,715

Governments – Sovereign Agencies

– 0

–

441,705

– 0

–

441,705

Collateralized Mortgage Obligations

– 0

–

– 0

–

358,384

358,384

Quasi-Sovereigns

– 0

–

247,800

– 0

–

247,800

Emerging Markets – Corporate Bonds

– 0

–

208,000

– 0

–

208,000

Emerging Markets – Sovereigns

– 0

–

196,875

– 0

–

196,875

Preferred Stocks

114,349

61,506

– 0

–

175,855

Governments – Treasuries

– 0

–

154,107

– 0

–

154,107

Bank Loans

– 0

–

– 0

–

133,325

133,325

Options Purchased – Puts

– 0

–

16,111

– 0

–

16,111

Warrants

– 0

–

– 0

–

13,856

13,856

Options Purchased – Calls

– 0

–

9,340

– 0

–

9,340

Short-Term Investments:

Investment Companies

2,653,060

– 0

–

– 0

–

2,653,060

U.S. Treasury Bills

– 0

–

99,995

– 0

–

99,995

Liabilities:

Corporates – Non-Investment Grade

– 0

–

(6,755,393

)

– 0

–

(6,755,393

)

Corporates – Investment Grade

– 0

–

(4,646,696

)

– 0

–

(4,646,696

)

Quasi-Sovereigns

– 0

–

(207,000

)

– 0

–

(207,000

)

Emerging Markets – Sovereigns

– 0

–

(161,000

)

– 0

–

(161,000

)

Total Investments in Securities

4,271,260

3,136,013

630,140

8,037,413

AB CREDIT LONG/SHORT PORTFOLIO  • 43

Notes to Financial Statements

Investments in Securities:	Level 1			Level 2			Level 3			Total
Other Financial Instruments*:
Assets:
Futures	$	20,382		$	7,330		$	– 0	–	$	27,712	#
Forward Currency Exchange Contracts		– 0	–		4,493			– 0	–		4,493
Centrally Cleared Credit Default Swaps		– 0	–		33,587			– 0	–		33,587	#
Credit Default Swaps		– 0	–		252,195			– 0	–		252,195
Total Return Swaps		– 0	–		41,876			– 0	–		41,876
Liabilities:
Futures		(7,699	)		– 0	–		– 0	–		(7,699	)#
Forward Currency Exchange Contracts		– 0	–		(16,387	)		– 0	–		(16,387	)
Put Options Written		– 0	–		(16,827	)		– 0	–		(16,827	)
Credit Default Swaptions Written		– 0	–		(395	)		– 0	–		(395	)
Centrally Cleared Credit Default Swaps		– 0	–		(38,967	)		– 0	–		(38,967	)#
Centrally Cleared Interest Rate Swaps		– 0	–		(6,345	)		– 0	–		(6,345	)#
Credit Default Swaps		– 0	–		(285,727	)		– 0	–		(285,727	)
Total Return Swaps		– 0	–		(37,366	)		– 0	–		(37,366	)
Total^	$	4,283,943		$	3,073,480		$	630,140		$	7,987,563

* Other financial instruments are derivative instruments, such as futures, forwards and swaps, which are valued at the unrealized appreciation/depreciation on the instrument. Other financial instruments may also include options written and swaptions written which are valued at market value.

# Only variation margin receivable/payable at period end is reported within the statement of assets and liabilities. This amount reflects cumulative appreciation/(depreciation) of exchange-traded derivatives as reported in the portfolio of investments.

^ There were no transfers between any levels during the reporting period.

The Portfolio recognizes all transfers between levels of the fair value hierarchy assuming the financial instruments were transferred at the beginning of the reporting period.

The following is a reconciliation of investments in which significant unobservable inputs (Level 3) were used in determining fair value.

	Corporates - Non- Investment Grade			Common Stocks			Collateralized Mortgage Obligations
Balance as of 10/31/14	$	124,800		$	– 0	–	$	699,902
Accrued discounts/(premiums)		(438	)		– 0	–		672
Realized gain (loss)		– 0	–		– 0	–		(11,947	)
Change in unrealized appreciation/depreciation		(3,462	)		1,891			9,275
Purchases/Payups		– 0	–		1,784			– 0	–
Sales/Paydowns		– 0	–		– 0	–		(339,518	)
Transfers in to Level 3		– 0	–		– 0	–		– 0	–
Transfers out of Level 3		– 0	–		– 0	–		– 0	–
Balance as of 10/31/15	$	120,900		$	3,675		$	358,384
Net change in unrealized appreciation/depreciation from investments held as of 10/31/15*	$	(3,462	)	$	1,891		$	(6,165	)

44 •  AB CREDIT LONG/SHORT PORTFOLIO

Notes to Financial Statements

	Bank Loans			Warrants			Total
Balance as of 10/31/14	$	466,414		$	– 0	–	$	1,291,116
Accrued discounts/(premiums)		585			– 0	–		819
Realized gain (loss)		(7,890	)		– 0	–		(19,837	)
Change in unrealized appreciation/depreciation		4,054			8,868			20,626
Purchases/Payups		36,375			4,988			43,147
Sales/Paydowns		(366,213	)		– 0	–		(705,731	)
Transfers in to Level 3		– 0	–		– 0	–		– 0	–
Transfers out of Level 3		– 0	–		– 0	–		– 0	–
Balance as of 10/31/15	$	133,325		$	13,856		$	630,140
Net change in unrealized appreciation/depreciation from investments held as of 10/31/15*	$	(1,697	)	$	8,868		$	(565	)

* The unrealized appreciation/depreciation is included in net change in unrealized appreciation/depreciation on investments and other financial instruments in the accompanying statement of operations.

The following presents information about significant unobservable inputs related to the Portfolio’s Level 3 investments at October 31, 2015. Securities priced by third party vendors are excluded from the following table.

Quantitative Information about Level 3 Fair Value Measurements
	Fair Value at 10/31/15		Valuation Technique	Unobservable Input	Range/ Weighted Average
Bank Loans	$	33,544	Market Approach	EBITDA* EBITDA Multiple Scrap Value	$   $	28 mil – $  70 mil / NA 6X   154 mil / NA

* Earnings before Interest, Taxes, Depreciation and Amortization.

The Adviser established the Committee to oversee the pricing and valuation of all securities held in the Portfolio. The Committee operates under pricing and valuation policies and procedures established by the Adviser and approved by the Board, including pricing policies which set forth the mechanisms and processes to be employed on a daily basis to implement these policies and procedures. In particular, the pricing policies describe how to determine market quotations for securities and other instruments. The Committee’s responsibilities include: 1) fair value and liquidity determinations (and oversight of any third parties to whom any responsibility for fair value and liquidity determinations is delegated), and 2) regular monitoring of the Adviser’s pricing and valuation policies and procedures and modification or enhancement of these policies and procedures (or recommendation of the modification of these policies and procedures) as the Committee believes appropriate.

AB CREDIT LONG/SHORT PORTFOLIO  • 45

Notes to Financial Statements

The Committee is also responsible for monitoring the implementation of the pricing policies by the Adviser’s Pricing Group (the “Pricing Group”) and a third party which performs certain pricing functions in accordance with the pricing policies. The Pricing Group is responsible for the oversight of the third party on a day-to-day basis. The Committee and the Pricing Group perform a series of activities to provide reasonable assurance of the accuracy of prices including: 1) periodic vendor due diligence meetings, review of methodologies, new developments and processes at vendors, 2) daily comparison of security valuation versus prior day for all securities that exceeded established thresholds, and 3) daily review of unpriced, stale, and variance reports with exceptions reviewed by senior management and the Committee.

In addition, several processes outside of the pricing process are used to monitor valuation issues including: 1) performance and performance attribution reports are monitored for anomalous impacts based upon benchmark performance, and 2) portfolio managers review all portfolios for performance and analytics (which are generated using the Adviser’s prices).

3. Currency Translation

Assets and liabilities denominated in foreign currencies and commitments under forward currency exchange contracts are translated into U.S. dollars at the mean of the quoted bid and ask prices of such currencies against the U.S. dollar. Purchases and sales of portfolio securities are translated into U.S. dollars at the rates of exchange prevailing when such securities were acquired or sold. Income and expenses are translated into U.S. dollars at rates of exchange prevailing when accrued.

Net realized gain or loss on foreign currency transactions represents foreign exchange gains and losses from sales and maturities of foreign fixed income investments, foreign currency exchange contracts, holding of foreign currencies, currency gains or losses realized between the trade and settlement dates on foreign investment transactions, and the difference between the amounts of dividends, interest and foreign withholding taxes recorded on the Portfolio’s books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized currency gains and losses from valuing foreign currency denominated assets and liabilities at period end exchange rates are reflected as a component of net unrealized appreciation or depreciation of foreign currency denominated assets and liabilities.

4. Taxes

It is the Portfolio’s policy to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its investment company taxable income and net realized gains, if any, to shareholders. Therefore, no provisions for federal income or excise taxes are required. The Portfolio may be subject to taxes imposed by countries in which it invests. Such taxes are generally based on income and/or capital gains earned or repatriated. Taxes are accrued and

46 •  AB CREDIT LONG/SHORT PORTFOLIO

Notes to Financial Statements

applied to net investment income, net realized gains and net unrealized appreciation/depreciation as such income and/or gains are earned.

In accordance with U.S. GAAP requirements regarding accounting for uncertainties in income taxes, management has analyzed the Portfolio’s tax positions taken or expected to be taken on federal and state income tax returns for all open tax years (the current and the prior tax year) and has concluded that no provision for income tax is required in the Portfolio’s financial statements.

5. Investment Income and Investment Transactions

Dividend income (or dividend expense) is recorded on the ex-dividend date or as soon as the Portfolio is informed of the dividend. Interest income (or interest expense) is accrued daily. Investment transactions are accounted for on the date the securities are purchased or sold. Investment gains or losses are determined on the identified cost basis. The Portfolio amortizes premiums and accretes discounts as adjustments to interest income.

6. Class Allocations

All income earned and expenses incurred by the Portfolio are borne on a pro-rata basis by each outstanding class of shares, based on the proportionate interest in the Portfolio represented by the net assets of such class, except for class specific expenses which are allocated to the respective class. Realized and unrealized gains and losses are allocated among the various share classes based on respective net assets.

7. Dividends and Distributions

Dividends and distributions to shareholders, if any, are recorded on the ex-dividend date. Income dividends and capital gains distributions are determined in accordance with federal tax regulations and may differ from those determined in accordance with U.S. GAAP. To the extent these differences are permanent, such amounts are reclassified within the capital accounts based on their federal tax basis treatment; temporary differences do not require such reclassification.

8. Offering Expenses

Offering expenses of $90,444 were deferred and amortized on a straight line basis over a one year period starting from May 7, 2014 (commencement of operations).

NOTE B

Advisory Fee and Other Transactions with Affiliates

Under the terms of the investment advisory agreement, the Portfolio pays the Adviser an advisory fee at an annual rate of .90% of the Portfolio’s average daily net assets. The fee is accrued daily and paid monthly. The Adviser has agreed to waive its fees and bear certain expenses to the extent necessary to limit total operating expenses on an annual basis (the “Expense Caps”) to 1.35%, 2.10%, and 1.10% of daily average net assets for Class A, Class C, and Advisor Class

AB CREDIT LONG/SHORT PORTFOLIO  • 47

Notes to Financial Statements

shares, respectively. Any fees waived and expenses borne by the Adviser through October 31, 2014 are subject to repayment by the Portfolio until October 31, 2017. Any fees waived and expense borne by the Adviser from November 1, 2014 through May 6, 2015 are subject to repayment by the Portfolio until October 31, 2018, provided that no reimbursement payment will be made that would cause the Portfolio’s total annual operating expenses to exceed the net fee percentage set forth in the preceding sentence. The Expense Caps may not be terminated by the Adviser before January 29, 2016. For the year ended October 31, 2015, such reimbursements/waivers amounted to $421,052.

During the year ended October 31, 2015, the Adviser reimbursed the Portfolio $1,338 for trading losses incurred due to a trade entry error.

Pursuant to the investment advisory agreement, the Portfolio may reimburse the Adviser for certain legal and accounting services provided to the Portfolio by the Adviser. For the year ended October 31, 2015, the Adviser voluntarily agreed to waive such fees amounting to $53,056.

The Portfolio compensates AllianceBernstein Investor Services, Inc. (“ABIS”), a wholly-owned subsidiary of the Adviser, under a Transfer Agency Agreement for providing personnel and facilities to perform transfer agency services for the Portfolio. ABIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. Such compensation retained by ABIS amounted to $ 16,569 for the year ended October 31, 2015.

AllianceBernstein Investments, Inc. (the “Distributor”), a wholly-owned subsidiary of the Adviser, serves as the distributor of the Portfolio’s shares. The Distributor has advised the Portfolio that it has retained front-end sales charges of $106 from the sale of Class A shares and received $0 and $0 in contingent deferred sales charges imposed upon redemptions by shareholders of Class A and Class C shares, respectively, for the year ended October 31, 2015.

The Portfolio may invest in the AB Fixed-Income Shares, Inc.—Government STIF Portfolio (“Government STIF Portfolio”), an open-end management investment company managed by the Adviser. The Government STIF Portfolio is offered as a cash management option to mutual funds and other institutional accounts of the Adviser, and is not available for direct purchase by members of the public. The Government STIF Portfolio pays no investment management fees but does bear its own expenses. A summary of the Portfolio’s transactions in shares of the Government STIF Portfolio for the year ended October 31, 2015 is as follows:

Market Value October 31, 2014 (000)		Purchases at Cost (000)		Sales Proceeds (000)		Market Value October 31, 2015 (000)		Dividend Income (000)
$	2,038	$	27,318	$	26,703	$	2,653	$	3

48 •  AB CREDIT LONG/SHORT PORTFOLIO

Notes to Financial Statements

Brokerage commissions paid on investment transactions for the year ended October 31, 2015 amounted to $19,040, of which $0 and $0, respectively, was paid to Sanford C. Bernstein & Co. LLC and Sanford C. Bernstein Limited, affiliates of the Adviser.

NOTE C

Distribution Services Agreement

The Portfolio has adopted a Distribution Services Agreement (the “Agreement”) pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the Agreement, the Portfolio pays distribution and servicing fees to the Distributor at an annual rate of up to .25% of the Portfolio’s average daily net assets attributable to Class A shares, 1% of the Portfolio’s average daily net assets attributable to Class C shares. There are no distribution and servicing fees on the Advisor Class shares. The fees are accrued daily and paid monthly. The Agreement provides that the Distributor will use such payments in their entirety for distribution assistance and promotional activities. Since the commencement of the Portfolio’s operations, the Distributor has incurred expenses in excess of the distribution costs reimbursed by the Portfolio in the amount of $103 for Class C shares. While such costs may be recovered from the Portfolio in future periods so long as the Agreement is in effect, the rate of the distribution and servicing fees payable under the Agreement may not be increased without a shareholder vote. In accordance with the Agreement, there is no provision for recovery of unreimbursed distribution costs incurred by the Distributor beyond the current fiscal year for Class A shares. The Agreement also provides that the Adviser may use its own resources to finance the distribution of the Portfolio’s shares.

NOTE D

Investment Transactions

Purchases and sales of investment securities (excluding short-term investments) for the year ended October 31, 2015, were as follows:

Purchases	Sales		Securities Sold Short		Covers on Securities Sold Short
$    29,852,619	$	28,595,242	$	18,357,751	$	12,296,933

During the year ended October 31, 2015, there were no purchases or sales of U.S. Government Securities.

The cost of investments for federal income tax purposes, gross unrealized appreciation and unrealized depreciation are as follows:

	Gross Unrealized					Net Unrealized Appreciation/ (Depreciation) on Investments			Net  Unrealized Appreciation/ (Depreciation) on Securities Sold Short			Net Unrealized Appreciation/ (Depreciation)
Cost of Investments	Appreciation on Investments		Depreciation on Investments
$    21,073,223	$	216,036	$	(1,481,757	)	$	(1,265,721	)	$	933,457	(a)	$	(332,264	)

^(a)  Gross unrealized appreciation was $970,664 and gross unrealized depreciation was $(37,207), resulting in net unrealized appreciation of $933,457.

AB CREDIT LONG/SHORT PORTFOLIO  • 49

Notes to Financial Statements

1. Derivative Financial Instruments

The Portfolio may use derivatives in an effort to earn income and enhance returns, to replace more traditional direct investments, to obtain exposure to otherwise inaccessible markets (collectively, “investment purposes”), or to hedge or adjust the risk profile of its portfolio.

The principal types of derivatives utilized by the Portfolio, as well as the methods in which they may be used are:

• Futures

The Portfolio may buy or sell futures for investment purposes or for the purpose of hedging its portfolio against adverse effects of potential movements in the market. The Portfolio bears the market risk that arises from changes in the value of these instruments and the imperfect correlation between movements in the price of the futures and movements in the price of the assets, reference rates or indices which they are designed to track. Among other things, the Portfolio may purchase or sell futures for foreign currencies or options thereon for non-hedging purposes as a means of making direct investment in foreign currencies, as described below under “Currency Transactions”.

At the time the Portfolio enters into futures, the Portfolio deposits and maintains as collateral an initial margin with the broker, as required by the exchange on which the transaction is effected. Such amount is shown as cash collateral due from broker on the statement of assets and liabilities. Pursuant to the contract, the Portfolio agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments are known as variation margin and are recorded by the Portfolio as unrealized gains or losses. Risks may arise from the potential inability of a counterparty to meet the terms of the contract. The credit/counterparty risk for exchange-traded futures is generally less than privately negotiated futures, since the clearinghouse, which is the issuer or counterparty to each exchange-traded future, has robust risk mitigation standards, including the requirement to provide initial and variation margin. When the contract is closed, the Portfolio records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the time it was closed.

Use of long futures subjects the Portfolio to risk of loss in excess of the amounts shown on the statement of assets and liabilities, up to the notional value of the futures. Use of short futures subjects the Portfolio to unlimited risk of loss. Under some circumstances, futures exchanges may establish daily limits on the amount that the price of futures can vary from the previous day’s settlement price, which could effectively prevent liquidation of unfavorable positions.

During the year ended October 31, 2015, the Portfolio held futures for hedging and non-hedging purposes.

50 •  AB CREDIT LONG/SHORT PORTFOLIO

Notes to Financial Statements

• Forward Currency Exchange Contracts

The Portfolio may enter into forward currency exchange contracts in order to hedge its exposure to changes in foreign currency exchange rates on its foreign portfolio holdings, to hedge certain firm purchase and sale commitments denominated in foreign currencies and for non-hedging purposes as a means of making direct investments in foreign currencies, as described below under “Currency Transactions”.

A forward currency exchange contract is a commitment to purchase or sell a foreign currency at a future date at a negotiated forward rate. The gain or loss arising from the difference between the original contract and the closing of such contract would be included in net realized gain or loss on foreign currency transactions. Fluctuations in the value of open forward currency exchange contracts are recorded for financial reporting purposes as unrealized appreciation and/or depreciation by the Portfolio. Risks may arise from the potential inability of a counterparty to meet the terms of a contract and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar.

During the year ended October 31, 2015, the Portfolio held forward currency exchange contracts for hedging and non-hedging purposes.

• Option Transactions

For hedging and investment purposes, the Portfolio may purchase and write (sell) put and call options on U.S. and foreign securities and foreign currencies that are traded on U.S. and foreign securities exchanges and over-the-counter markets. Among other things, the Portfolio may also use options transactions for non-hedging purposes as a means of making direct investments in foreign currencies, as described below under “Currency Transactions” and may use options strategies involving the purchase and/or writing of various combinations of call and/or put options, for hedging and investment purposes.

The risk associated with purchasing an option is that the Portfolio pays a premium whether or not the option is exercised. Additionally, the Portfolio bears the risk of loss of the premium and change in market value should the counterparty not perform under the contract. Put and call options purchased are accounted for in the same manner as portfolio securities. The cost of securities acquired through the exercise of call options is increased by premiums paid. The proceeds from securities sold through the exercise of put options are decreased by the premiums paid.

When the Portfolio writes an option, the premium received by the Portfolio is recorded as a liability and is subsequently adjusted to the current market value of the option written. Premiums received from written options which expire unexercised are recorded by the Portfolio on the expiration date as realized gains from options written. The difference between the premium received and the amount paid on effecting a closing

AB CREDIT LONG/SHORT PORTFOLIO  • 51

Notes to Financial Statements

purchase transaction, including brokerage commissions, is also treated as a realized gain, or if the premium received is less than the amount paid for the closing purchase transaction, as a realized loss. If a call option is exercised, the premium received is added to the proceeds from the sale of the underlying security or currency in determining whether the Portfolio has realized a gain or loss. If a put option is exercised, the premium received reduces the cost basis of the security or currency purchased by the Portfolio. In writing an option, the Portfolio bears the market risk of an unfavorable change in the price of the security or currency underlying the written option. Exercise of an option written by the Portfolio could result in the Portfolio selling or buying a security or currency at a price different from the current market value.

At October 31, 2015, the maximum payments for written put options amounted to $2,282,050. In certain circumstances maximum payout amounts may be partially offset by recovery values of the respective referenced assets and upfront premium received upon entering into the contract.

The Portfolio may also invest in options on swap agreements, also called “swaptions”. A swaption is an option that gives the buyer the right, but not the obligation, to enter into a swap on a future date in exchange for paying a market-based “premium”. A receiver swaption gives the owner the right to receive the total return of a specified asset, reference rate, or index. A payer swaption gives the owner the right to pay the total return on a specified asset, reference rate, or index. Swaptions also include options that allow an existing swap to be terminated or extended by one of the counterparties.

During the year ended October 31, 2015, the Portfolio held purchased options for hedging and non-hedging purposes. During the year ended October 31, 2015, the Portfolio held written options for hedging and non-hedging purposes.

For the year ended October 31, 2015, the Portfolio had the following transactions in written options:

	Number of Contracts			Premiums Received
Options written outstanding as of 10/31/14		308		$	33,464
Options written		633,814			143,280
Options expired		(1,100	)		(79,325	)
Options bought back		(632,810	)		(53,598	)
Options exercised		– 0	–		– 0	–
Options written outstanding as of 10/31/15		212		$	43,821

52 •  AB CREDIT LONG/SHORT PORTFOLIO

Notes to Financial Statements

	Notional Amount			Premiums Received
Swaptions written outstanding as of 10/31/14		5,180,000		$	13,411
Swaptions written		28,675,000			89,813
Swaptions expired		(29,035,000	)		(90,707	)
Swaptions bought back		(3,150,000	)		(11,320	)
Swaptions exercised		– 0	–		– 0	–
Swaptions written outstanding as of 10/31/15		1,670,000		$	1,197

• Swaps

The Portfolio may enter into swaps to hedge its exposure to interest rates, credit risk, or currencies. The Portfolio may also enter into swaps for non-hedging purposes as a means of gaining market exposures, including by making direct investments in foreign currencies, as described below under “Currency Transactions” or in order to take a “long” or “short” position with respect to an underlying referenced asset described below under “Total Return Swaps”. A swap is an agreement that obligates two parties to exchange a series of cash flows at specified intervals based upon or calculated by reference to changes in specified prices or rates for a specified amount of an underlying asset. The payment flows are usually netted against each other, with the difference being paid by one party to the other. In addition, collateral may be pledged or received by the Portfolio in accordance with the terms of the respective swaps to provide value and recourse to the Portfolio or its counterparties in the event of default, bankruptcy or insolvency by one of the parties to the swap.

Risks may arise as a result of the failure of the counterparty to the swap to comply with the terms of the swap. The loss incurred by the failure of a counterparty is generally limited to the net interim payment to be received by the Portfolio, and/or the termination value at the end of the contract. Therefore, the Portfolio considers the creditworthiness of each counterparty to a swap in evaluating potential counterparty risk. This risk is mitigated by having a netting arrangement between the Portfolio and the counterparty and by the posting of collateral by the counterparty to the Portfolio to cover the Portfolio’s exposure to the counterparty. Additionally, risks may arise from unanticipated movements in interest rates or in the value of the underlying securities. The Portfolio accrues for the interim payments on swaps on a daily basis, with the net amount recorded within unrealized appreciation/depreciation of swaps on the statement of assets and liabilities, where applicable. Once the interim payments are settled in cash, the net amount is recorded as realized gain/(loss) on swaps on the statement of operations, in addition to any realized gain/(loss) recorded upon the termination of swaps. Upfront premiums paid or received are recognized as cost or proceeds on the statement of assets and liabilities and are amortized on a straight line basis over the life of the contract. Amortized upfront premiums are included in net realized

AB CREDIT LONG/SHORT PORTFOLIO  • 53

Notes to Financial Statements

gain/(loss) from swaps on the statement of operations. Fluctuations in the value of swaps are recorded as a component of net change in unrealized appreciation/depreciation of swaps on the statement of operations.

Certain standardized swaps, including certain interest rate swaps and credit default swaps, are (or soon will be) subject to mandatory central clearing. Cleared swaps are transacted through futures commission merchants (“FCMs”) that are members of central clearinghouses, with the clearinghouse serving as central counterparty, similar to transactions in futures contracts. Centralized clearing will be required for additional categories of swaps on a phased-in basis based on requirements published by the Securities and Exchange Commission and Commodity Futures Trading Commission.

At the time the Portfolio enters into a centrally cleared swap, the Portfolio deposits and maintains as collateral an initial margin with the broker, as required by the clearinghouse on which the transaction is effected. Such amount is shown as cash collateral due from broker on the statement of assets and liabilities. Pursuant to the contract, the Portfolio agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments are known as variation margin and are recorded by the Portfolio as unrealized gains or losses. Risks may arise from the potential inability of a counterparty to meet the terms of the contract. The credit/counterparty risk for centrally cleared swaps is generally less than non-centrally cleared swaps, since the clearinghouse, which is the issuer or counterparty to each centrally cleared swap, has robust risk mitigation standards, including the requirement to provide initial and variation margin. When the contract is closed, the Portfolio records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the time it was closed.

Interest Rate Swaps:

The Portfolio is subject to interest rate risk exposure in the normal course of pursuing its investment objectives. Because the Portfolio holds fixed rate bonds, the value of these bonds may decrease if interest rates rise. To help hedge against this risk and to maintain its ability to generate income at prevailing market rates, the Portfolio may enter into interest rate swaps. Interest rate swaps are agreements between two parties to exchange cash flows based on a notional amount. The Portfolio may elect to pay a fixed rate and receive a floating rate, or, receive a fixed rate and pay a floating rate on a notional amount.

In addition, the Portfolio may also enter into interest rate swap transactions to preserve a return or spread on a particular investment or portion of its portfolio, or protecting against an increase in the price of securities the Portfolio anticipates purchasing at a later date. Interest rate swaps involve the exchange by a Portfolio with another party of their respective commitments

54 •  AB CREDIT LONG/SHORT PORTFOLIO

Notes to Financial Statements

to pay or receive interest (e.g., an exchange of floating rate payments for fixed rate payments) computed based on a contractually-based principal (or “notional”) amount. Interest rate swaps are entered into on a net basis (i.e., the two payment streams are netted out, with the Portfolio receiving or paying, as the case may be, only the net amount of the two payments).

During the year ended October 31, 2015, the Portfolio held interest rate swaps for hedging purposes.

Credit Default Swaps:

The Portfolio may enter into credit default swaps, including to manage its exposure to the market or certain sectors of the market, to reduce its risk exposure to defaults by corporate and sovereign issuers held by the Portfolio, or to create exposure to corporate or sovereign issuers to which it is not otherwise exposed. The Portfolio may purchase credit protection (“Buy Contract”) or provide credit protection (“Sale Contract”) on the referenced obligation of the credit default swap. During the term of the swap, the Portfolio receives/(pays) fixed payments from/(to) the respective counterparty, calculated at the agreed upon rate applied to the notional amount. If the Portfolio is a buyer/(seller) of protection and a credit event occurs, as defined under the terms of the swap, the Portfolio will either (i) receive from the seller/(pay to the buyer) of protection an amount equal to the notional amount of the swap (the “Maximum Payout Amount”) and deliver/(take delivery of) the referenced obligation or (ii) receive/(pay) a net settlement amount in the form of cash or securities equal to the notional amount of the swap less the recovery value of the referenced obligation.

In certain circumstances Maximum Payout Amounts may be partially offset by recovery values of the respective referenced obligations, upfront premium received upon entering into the agreement, or net amounts received from settlement of buy protection credit default swaps entered into by the Portfolio for the same reference obligation with the same counterparty. As of October 31, 2015, the Portfolio had Buy Contracts outstanding with respect to the same referenced obligation and same counterparty for its Sales Contracts which may partially offset the Maximum Payout Amount in the amount of $901,000.

Credit default swaps may involve greater risks than if a Portfolio had invested in the referenced obligation directly. Credit default swaps are subject to general market risk, liquidity risk, counterparty risk and credit risk. If the Portfolio is a buyer of protection and no credit event occurs, it will lose the payments it made to its counterparty. If the Portfolio is a seller of protection and a credit event occurs, the value of the referenced obligation received by the Portfolio coupled with the periodic payments previously received, may be less than the Maximum Payout Amount it pays to the buyer, resulting in a net loss to the Portfolio.

AB CREDIT LONG/SHORT PORTFOLIO  • 55

Notes to Financial Statements

Implied credit spreads over U.S. Treasuries of comparable maturity utilized in determining the market value of credit default swaps on issuers as of period end are disclosed in the portfolio of investments. The implied spreads serve as an indicator of the current status of the payment/performance risk and typically reflect the likelihood of default by the issuer of the referenced obligation. The implied credit spread of a particular reference obligation also reflects the cost of buying/selling protection and may reflect upfront payments required to be made to enter into the agreement. Widening credit spreads typically represent a deterioration of the referenced obligation’s credit soundness and greater likelihood of default or other credit event occurring as defined under the terms of the agreement. A credit spread identified as “Defaulted” indicates a credit event has occurred for the referenced obligation.

During the year ended October 31, 2015, the Portfolio held credit default swaps for hedging and non-hedging purposes.

Total Return Swaps:

The Portfolio may enter into total return swaps in order take a “long” or “short” position with respect to an underlying referenced asset. The Portfolio is subject to market price volatility of the underlying referenced asset. A total return swap involves commitments to pay interest in exchange for a market linked return based on a notional amount. To the extent that the total return of the security, group of securities or index underlying the transaction exceeds or falls short of the offsetting interest obligation, the Portfolio will receive a payment from or make a payment to the counterparty.

During the year ended October 31, 2015, the Portfolio held total return swaps for hedging and non-hedging purposes.

The Portfolio typically enters into International Swaps and Derivatives Association, Inc. Master Agreements (“ISDA Master Agreement”) or similar master agreements (collectively, “Master Agreements”) with its derivative contract counterparties in order to, among other things, reduce its credit risk to counterparties. ISDA Master Agreements include provisions for general obligations, representations, collateral and events of default or termination. Under an ISDA Master Agreement, the Portfolio typically may offset with the counterparty certain derivative financial instrument’s payables and/or receivables with collateral held and/or posted and create one single net payment (close-out netting) in the event of default or termination.

Various Master Agreements govern the terms of certain transactions with counterparties, including transactions such as derivative transactions, repurchase and reverse repurchase agreements. These Master Agreements typically attempt to reduce the counterparty risk associated with such transactions by specifying credit protection mechanisms and providing standardization that improves legal certainty. Cross-termination provisions under Master Agreements typically provide

56 •  AB CREDIT LONG/SHORT PORTFOLIO

Notes to Financial Statements

that a default in connection with one transaction between the Portfolio and a counterparty gives the non-defaulting party the right to terminate any other transactions in place with the defaulting party to create one single net payment due to/due from the defaulting party. In the event of a default by a Master Agreements counterparty, the return of collateral with market value in excess of the Portfolio’s net liability, held by the defaulting party, may be delayed or denied.

The Portfolio’s Master Agreements may contain provisions for early termination of OTC derivative transactions in the event the net assets of the Portfolio decline below specific levels (“net asset contingent features”). If these levels are triggered, the Portfolio’s counterparty has the right to terminate such transaction and require the Portfolio to pay or receive a settlement amount in connection with the terminated transaction. For additional details, please refer to netting arrangements by counterparty tables below.

At October 31, 2015, the Portfolio had entered into the following derivatives:

	Asset Derivatives				Liability Derivatives
Derivative Type	Statement of Assets and Liabilities Location	Fair Value			Statement of Assets and Liabilities Location	Fair Value
Interest rate contracts	Receivable/Payable for variation margin on exchange-traded derivatives	$	19,964	*	Receivable/Payable for variation margin on exchange-traded derivatives	$	6,958	*
Credit contracts	Receivable/Payable for variation margin on exchange-traded derivatives		33,587	*	Receivable/Payable for variation margin on exchange-traded derivatives		38,967	*
Equity contracts	Receivable/Payable for variation margin on exchange-traded derivatives		7,748	*	Receivable/Payable for variation margin on exchange-traded derivatives		7,086	*
Foreign exchange contracts	Unrealized appreciation on forward currency exchange contracts		4,493		Unrealized depreciation on forward currency exchange contracts		16,387
Credit contracts	Investments in securities, at value		2,486
Equity contracts	Investments in securities, at value		22,965
Credit contracts					Swaptions written, at value		395
Equity contracts					Options written, at value		16,827
Credit contracts	Unrealized appreciation on credit default swaps		252,195		Unrealized depreciation on credit default swaps		285,727

AB CREDIT LONG/SHORT PORTFOLIO  • 57

Notes to Financial Statements

	Asset Derivatives			Liability Derivatives
Derivative Type	Statement of Assets and Liabilities Location	Fair Value		Statement of Assets and Liabilities Location	Fair Value
Equity contracts	Unrealized appreciation on total return swaps	$	41,876	Unrealized depreciation on total return swaps	$	37,366
Total		$	385,314		$	409,713

* Only variation margin receivable/payable at period end is reported within the statement of assets and liabilities. This amount reflects cumulative appreciation/(depreciation) of exchange-traded derivatives as reported in the portfolio of investments.

The effect of derivative instruments on the statement of operations for the year ended October 31, 2015:

Derivative Type	Location of Gain or (Loss) on Derivatives	Realized Gain or (Loss) on Derivatives			Change in Unrealized Appreciation or (Depreciation)
Interest rate contracts	Net realized gain (loss) on futures; Net change in unrealized appreciation/depreciation of futures	$	(73,781	)	$	29,289
Equity contracts	Net realized gain (loss) on futures; Net change in unrealized appreciation/depreciation of futures		16,257			4,551
Foreign exchange contracts	Net realized gain (loss) on foreign currency transactions; Net change in unrealized appreciation/depreciation of foreign currency denominated assets and liabilities		8,279			(20,164	)
Interest rate contracts	Net realized gain (loss) on investment transactions; Net change in unrealized appreciation/depreciation of investments		(8,053	)		5,266
Foreign exchange contracts	Net realized gain (loss) on investment transactions; Net change in unrealized appreciation/depreciation of investments		(2,909	)		– 0	–

58 •  AB CREDIT LONG/SHORT PORTFOLIO

Notes to Financial Statements

Derivative Type	Location of Gain or (Loss) on Derivatives	Realized Gain or (Loss) on Derivatives			Change in Unrealized Appreciation or (Depreciation)
Credit contracts	Net realized gain (loss) on investment transactions; Net change in unrealized appreciation/depreciation of investments	$	(138,465	)	$	5,601
Equity contracts	Net realized gain (loss) on investment transactions; Net change in unrealized appreciation/depreciation of investments		(197,403	)		(15,924	)
Credit contracts	Net realized gain (loss) on swaptions written; Net change in unrealized appreciation/depreciation of swaptions written		96,272			(3,001	)
Equity contracts	Net realized gain (loss) on options written; Net change in unrealized appreciation/depreciation of options written		52,786			29,825
Interest rate contracts	Net realized gain (loss) on swaps; Net change in unrealized appreciation/depreciation of swaps		(66,069	)		18,447
Credit contracts	Net realized gain (loss) on swaps; Net change in unrealized appreciation/depreciation of swaps		32,339			(20,757	)
Equity contracts	Net realized gain (loss) on swaps; Net change in unrealized appreciation/depreciation of swaps		26,933			(15,083	)
Total		$	(253,814	)	$	18,050

AB CREDIT LONG/SHORT PORTFOLIO  • 59

Notes to Financial Statements

The following table represents the average monthly volume of the Portfolio’s derivative transactions during the year ended October 31, 2015:

Futures:
Average original value of buy contracts	$	1,934,968
Average original value of sale contracts	$	1,346,430
Forward Currency Exchange Contracts:
Average principal amount of buy contracts	$	2,995,966
Average principal amount of sale contracts	$	687,561
Purchased Options:
Average monthly cost	$	109,249
Centrally Cleared Interest Rate Swaps:
Average notional amount	$	1,596,154
Credit Default Swaps:
Average notional amount of buy contracts	$	9,074,646
Average notional amount of sale contracts	$	3,556,959
Centrally Cleared Credit Default Swaps:
Average notional amount of buy contracts	$	5,482,601
Average notional amount of sale contracts	$	2,163,195
Total Return Swaps:
Average notional amount	$	2,009,583	(a)

^(a)  Positions were open for eleven months during the year.

For financial reporting purposes, the Portfolio does not offset derivative assets and derivative liabilities that are subject to netting arrangements in the statement of assets and liabilities.

All derivatives held at period end were subject to netting arrangements. The following table presents the Portfolio’s derivative assets and liabilities by counterparty net of amounts available for offset under Master Agreements (“MA”) and net of the related collateral received/ pledged by the Portfolio as of October 31, 2015:

Counterparty	Derivative Assets Subject to a MA		Derivative Available for Offset			Cash Collateral Received*			Security Collateral Received			Net Amount of Derivatives Assets
Exchange-Traded Derivatives:
Morgan Stanley & Co. LLC**	$	17,987	$	(17,987	)	$	– 0	–	$	– 0	–	$	– 0	–
Total	$	17,987	$	(17,987	)	$	– 0	–	$	– 0	–	$	– 0	–
OTC Derivatives:
Barclays Bank PLC	$	300,663	$	(36,675	)	$	(263,988	)	$	– 0	–	$	– 0	–
Citibank, NA		346,473		(346,473	)		– 0	–		– 0	–		– 0	–
Credit Suisse International		23,066		(23,066	)		– 0	–		– 0	–		– 0	–

60 •  AB CREDIT LONG/SHORT PORTFOLIO

Notes to Financial Statements

Counterparty

Derivative Assets Subject to a MA

Derivative Available for Offset

Cash Collateral Received*

Security Collateral Received

Net Amount of Derivatives Assets

Deutsche Bank AG

6,191

(6,191

)

– 0

–

– 0

–

– 0

–

Goldman Sachs International

117,879

(70,633

)

– 0

–

– 0

–

47,246

JPMorgan Chase Bank, NA

8,741

(8,741

)

– 0

–

– 0

–

– 0

–

Morgan Stanley Capital Services LLC

242,130

(174,218

)

– 0

–

– 0

–

67,912

Royal Bank of Scotland PLC

1,588

– 0

–

– 0

–

– 0

–

1,588

Standard Chartered Bank

717

(717

)

– 0

–

– 0

–

– 0

–

State Street Bank & Trust Co.

2,116

(2,116

)

– 0

–

– 0

–

– 0

–

Total

$

1,049,564

$

(668,830

)

$

(263,988

)

$

– 0

–

$

116,746

^

Counterparty	Derivative Liabilities Subject to a MA		Derivative Available for Offset			Cash Collateral Pledged*			Security Collateral Pledged*			Net Amount of Derivatives Liabilities
Exchange-Traded Derivatives:
Morgan Stanley & Co. LLC**	$	21,743	$	(17,987	)	$	(3,756	)	$	– 0	–	$	– 0	–
Total	$	21,743	$	(17,987	)	$	(3,756	)	$	– 0	–	$	– 0	–
OTC Derivatives:
Bank of America, NA	$	7,108	$	– 0	–	$	– 0	–	$	– 0	–	$	7,108
Barclays Bank PLC		36,675		(36,675	)		– 0	–		– 0	–		– 0	–
Citibank, NA		347,718		(346,473	)		– 0	–		(1,245	)		– 0	–
Credit Suisse International		44,965		(23,066	)		– 0	–		– 0	–		21,899
Deutsche Bank AG		15,007		(6,191	)		– 0	–		– 0	–		8,816
Goldman Sachs International:		70,633		(70,633	)		– 0	–		– 0	–		– 0	–
JPMorgan Chase Bank, NA		25,517		(8,741	)		– 0	–		– 0	–		16,776
Morgan Stanley Capital Services LLC		174,218		(174,218	)		– 0	–		– 0	–		– 0	–
Standard Chartered Bank		2,009		(717	)		– 0	–		– 0	–		1,292
State Street Bank & Trust Co.		12,927		(2,116	)		– 0	–		– 0	–		10,811
Total	$	736,777	$	(668,830	)	$	– 0	–	$	(1,245	)	$	66,702	^

* The actual collateral received/pledged may be more than the amount reported due to overcollateralization.

** Cash has been posted for initial margin requirements for exchange traded derivatives outstanding at October 31, 2015.

^ Net amount represents the net receivable/payable that would be due from/to the counterparty in the event of default or termination. The net amount from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same counterparty.

AB CREDIT LONG/SHORT PORTFOLIO  • 61

Notes to Financial Statements

2. Currency Transactions

The Portfolio may invest in non-U.S. dollar securities on a currency hedged or unhedged basis. The Portfolio may seek investment opportunities by taking long or short positions in currencies through the use of currency-related derivatives, including forward currency exchange contracts, futures and options on futures, swaps, and other options. The Portfolio may enter into transactions for investment opportunities when it anticipates that a foreign currency will appreciate or depreciate in value but securities denominated in that currency are not held by the Portfolio and do not present attractive investment opportunities. Such transactions may also be used when the Adviser believes that it may be more efficient than a direct investment in a foreign currency-denominated security. The Portfolio may also conduct currency exchange contracts on a spot basis (i.e., for cash at the spot rate prevailing in the currency exchange market for buying or selling currencies).

3. Short Sales

The Portfolio may sell securities short. A short sale is a transaction in which the Portfolio sells securities it does not own, but has borrowed, in anticipation of a decline in the market price of the securities. The Portfolio is obligated to replace the borrowed securities at their market price at the time of settlement. The Portfolio’s obligation to replace the securities borrowed in connection with a short sale will be fully secured by collateral deposited with the broker. The Portfolio is liable to the buyer for any dividends/interest payable on securities while those securities are in a short position. These dividends/interest are recorded as an expense of the Portfolio. Short sales by the Portfolio involve certain risks and special considerations. Possible losses from short sales differ from losses that could be incurred from a purchase of a security because losses from short sales may be unlimited, whereas losses from purchases cannot exceed the total amount invested.

NOTE E

Capital Stock

Each class consists of 3,000,000,000 authorized shares. Transactions in capital shares for each class were as follows:

	Shares						Amount
	Year Ended October 31, 2015			May 7 2014(a) to October 31, 2014			Year Ended October 31, 2015			May 7 2014(a) to October 31, 2014
Class A
Shares sold		11,548			8,408		$	113,733		$	83,942
Shares issued in reinvestment of dividends		100			4			984			41
Shares redeemed		(1,128	)		– 0	–		(11,052	)		– 0	–
Net increase		10,520			8,412		$	103,665		$	83,983

62 •  AB CREDIT LONG/SHORT PORTFOLIO

Notes to Financial Statements

	Shares						Amount
	Year Ended October 31, 2015			May 7 2014(a) to October 31, 2014			Year Ended October 31, 2015			May 7 2014(a) to October 31, 2014
Class C
Shares sold		5,701			4,445		$	56,054		$	44,511
Shares issued in reinvestment of dividends		31			14			308			141
Net increase		5,732			4,459		$	56,362		$	44,652
Advisor Class
Shares sold		120,616			2,095,777		$	1,189,631		$	20,956,109
Shares issued in reinvestment of dividends		1,369			162			13,427			1,617
Shares redeemed		(85,608	)		(8,288	)		(840,359	)		(81,830	)
Net increase		36,377			2,087,651		$	362,699		$	20,875,896

^(a)  Commencement of operations.

NOTE F

Risks Involved in Investing in the Portfolio

Interest Rate Risk and Credit Risk—Interest rate risk is the risk that changes in interest rates will affect the value of the Portfolio’s investments in fixed-income debt securities such as bonds or notes. Increases in interest rates may cause the value of the Portfolio’s investments to decline. Credit risk is the risk that the issuer or guarantor of a debt security, or the counterparty to a derivative contract, will be unable or unwilling to make timely principal and/or interest payments, or to otherwise honor its obligations. The degree of risk for a particular security may be reflected in its credit rating. Credit risk is greater for medium quality and lower-rated securities. Lower-rated debt securities and similar unrated securities (commonly known as “junk bonds”) have speculative elements or are predominantly speculative risks.

Below Investment Grade Securities Risk—Investments in fixed-income securities with lower ratings (commonly known as “junk bonds”) are subject to a higher probability that an issuer will default or fail to meet its payment obligations. These securities may be subject to greater price volatility due to such factors as specific corporate developments, negative perceptions of the junk bond market generally and less secondary market liquidity. These securities are often able to be “called” or repurchased by the issuer prior to their maturity date, forcing the Fund to reinvest the proceeds, possibly at a lower rate of return.

Inflation Risk—This is the risk that the value of assets or income from investments will be less in the future as inflation decreases the value of money. As inflation increases, the value of each Portfolio’s assets can decline as can the value of the Portfolio’s distributions. This risk is significantly greater if the Fund invests a significant portion of its assets in fixed-income securities with longer maturities.

AB CREDIT LONG/SHORT PORTFOLIO  • 63

Notes to Financial Statements

Derivatives Risk—The Portfolio may enter into derivative transactions such as forwards, options, futures and swaps. Derivatives may be illiquid, difficult to price, and leveraged so that small changes may produce disproportionate losses for the Portfolio, and subject to counterparty risk to a greater degree than more traditional investments. Derivatives may result in significant losses, including losses that are far greater than the value of the derivatives reflected in the statement of assets and liabilities.

Leverage Risk—When the Portfolio borrows money or otherwise leverages its investments, its performance may be volatile because leverage tends to exaggerate the effect of any increase or decrease in the value of the Portfolio’s investments. The Portfolio may create leverage through the use of reverse repurchase arrangements, forward currency exchange contracts, forward commitments, dollar rolls or futures or by borrowing money. The use of derivative instruments by the Portfolio, such as forwards, futures, options and swaps, may also result in a form of leverage. Leverage may result in higher returns to the Portfolio than if the Portfolio were not leveraged, but may also adversely affect returns, particularly if the market is declining.

Short Sales Risk— Short sales involve the risk that the Portfolio will incur a loss by subsequently buying a security at a higher price than the price at which it sold the security. The amount of such loss is theoretically unlimited, as it will be based on the increase in value of the security sold short. In contrast, the risk of loss from a long position is limited to the Portfolio’s investment in the security, because the price of the security cannot fall below zero. The Portfolio may not always be able to close out a short position on favorable terms.

Foreign (Non-U.S.) Risk—Investment in securities of non-U.S. issuers may involve more risk than those of U.S. issuers. These securities may fluctuate more widely in price and may be less liquid due to adverse market, economic, political, regulatory or other factors.

Emerging Market Risk—Investments in emerging market countries may have more risk because the markets are less developed and less liquid as well as being subject to increased economic, political, regulatory, or other uncertainties.

Currency Risk—Fluctuations in currency exchange rates may negatively affect the value of the Portfolio’s investments or reduce its returns.

Non-Diversification Risk—The Portfolio may have more risk because it is “non-diversified”, meaning that it can invest more of its assets in a smaller number of issuers and that adverse changes in the value of one security could have a more significant effect on the Portfolio’s NAV.

Liquidity Risk—Liquidity risk occurs when certain investments become difficult to purchase or sell. Difficulty in selling less liquid securities may result in sales at disadvantageous prices affecting the value of your investment in the Portfolio. Causes of liquidity risk may include low trading volumes, large positions and

64 •  AB CREDIT LONG/SHORT PORTFOLIO

Notes to Financial Statements

heavy redemptions of fixed-income mutual fund shares. Over recent years, liquidity risk has also increased because the capacity of dealers in the secondary market for fixed-income securities to make markets in these securities has decreased, even as the overall bond market has grown significantly, due to, among other things, structural changes, additional regulatory requirements and capital and risk restraints that have led to reduced inventories. Liquidity risk may be higher in a rising interest rate environment, when the value and liquidity of fixed-income securities generally go down.

Indemnification Risk—In the ordinary course of business, the Portfolio enter into contracts that contain a variety of indemnifications. The Portfolio’s maximum exposure under these arrangements is unknown. However, the Portfolio has not had prior claims or losses pursuant to these indemnification provisions and expect the risk of loss thereunder to be remote. Therefore, the Portfolio has not accrued any liability in connection with these indemnification provisions.

NOTE G

Joint Credit Facility

A number of open-end mutual funds managed by the Adviser, including the Portfolio, participate in a $280 million revolving credit facility (the “Facility”) intended to provide short-term financing, if necessary, subject to certain restrictions in connection with abnormal redemption activity. Commitment fees related to the Facility are paid by the participating funds and are included in miscellaneous expenses in the statement of operations. The Portfolio did not utilize the Facility during the year ended October 31, 2015.

NOTE H

Distributions to Shareholders

The tax character of distributions paid during the fiscal years ended October 31, 2015 and October 31, 2014 were as follows:

	2015		2014
Distributions paid from:
Ordinary income	$	202,872	$	101,996
Total distributions paid	$	202,872	$	101,996

As of October 31, 2015, the components of accumulated earnings/(deficit) on a tax basis were as follows:

Undistributed ordinary income	$	88,564
Unrealized appreciation/(depreciation)		(304,391	)(a)
Total accumulated earnings/(deficit)	$	(215,827	)(b)

^(a)  The differences between book-basis and tax-basis unrealized appreciation/(depreciation) are attributable primarily to the tax deferral of losses on wash sales, the tax treatment of swaps and the realization for tax purposes of gains/losses on certain derivative instruments.

^(b) The difference between book-basis and tax-basis components of accumulated earnings/(deficit) is attributable primarily to the tax treatment of defaulted securities.

AB CREDIT LONG/SHORT PORTFOLIO  • 65

Notes to Financial Statements

For tax purposes, net capital losses may be carried over to offset future capital gains, if any. Funds are permitted to carry forward capital losses incurred in taxable years beginning after December 22, 2010 for an indefinite period, and such losses will retain their character as either short-term or long-term capital losses. As of October 31, 2015, the Portfolio did not have any capital loss carryforwards.

During the current fiscal year, permanent differences primarily due to the tax treatment of offering costs and clearing fees, reclassifications of foreign currency, the tax treatment of proceeds from the sale of defaulted securities, contributions from Affiliates, the redesignation of dividends, return of capital distributions received from underlying securities, the offset of a net operating loss against capital gain, and the tax treatment of swaps and options resulted in a net decrease in undistributed net investment income, a net decrease in accumulated net realized loss on investment and foreign currency transactions, and a net decrease in additional paid-in capital. These reclassifications had no effect on net assets.

NOTE I

New Accounting Pronouncement

In May 2015, the Financial Accounting Standards Board issued an Accounting Standards Update (“ASU”), ASU 2015-07, which removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the net asset value per share practical expedient. The ASU also removes the disclosure requirement for investments not valued at net asset value. The ASU is effective for annual periods beginning after December 15, 2015 and interim periods within those annual periods. At this time, management is evaluating the implications of these changes on the financial statements.

NOTE J

Subsequent Events

Management has evaluated subsequent events for possible recognition or disclosure in the financial statements through the date the financial statements are issued. Management has determined that there are no material events that would require disclosure in the Portfolio’s financial statements through this date.

66 •  AB CREDIT LONG/SHORT PORTFOLIO

Notes to Financial Statements

FINANCIAL HIGHLIGHTS

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class A
	Year Ended October 31, 2015			May 7, 2014(a) to October 31, 2014
Net asset value, beginning of period		$  10.00			$  10.00
Income From Investment Operations
Net investment income(b)(c)		.09			.08
Net realized and unrealized loss on investment and foreign currency transactions		(.16	)		(.03	)
Contributions from Affiliates		.00	(d)		– 0	–
Net increase (decrease) in net asset value from operations		(.07	)		.05
Less: Dividends
Dividends from net investment income		(.08	)		(.05	)
Net asset value, end of period		$    9.85			$  10.00
Total Return
Total investment return based on net asset value(e)*		(.65	)%		.57	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$186			$84
Ratio to average net assets of:
Expenses, net of waivers/reimbursements(f)		5.02	%		3.56	%^
Expenses, before waivers/reimbursements(f)		7.28	%		4.29	%^
Net investment income(c)		.88	%		1.79	%^
Portfolio turnover rate		163	%		69	%
Portfolio turnover rate (including securities sold short)		147	%		102	%

See footnote summary on page 70.

AB CREDIT LONG/SHORT PORTFOLIO  • 67

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class C
	Year Ended October 31, 2015			May 7, 2014(a) to October 31, 2014
Net asset value, beginning of period		$  9.97			$  10.00
Income From Investment Operations
Net investment income(b)(c)		.01			.06
Net realized and unrealized loss on investment and foreign currency transactions		(.15	)		(.05	)
Contributions from Affiliates		.00	(d)		– 0	–
Net increase (decrease) in net asset value from operations		(.14	)		.01
Less: Dividends
Dividends from net investment income		(.06	)		(.04	)
Net asset value, end of period		$  9.77			$    9.97
Total Return
Total investment return based on net asset value(e)*		(1.45	)%		.21	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$100			$44
Ratio to average net assets of:
Expenses, net of waivers/reimbursements(f)		5.78	%		4.18	%^
Expenses, before waivers/reimbursements(f)		8.08	%		6.31	%^
Net investment income(c)		.10	%		1.21	%^
Portfolio turnover rate		163	%		69	%
Portfolio turnover rate (including securities sold short)		147	%		102	%

See footnote summary on page 70.

68 •  AB CREDIT LONG/SHORT PORTFOLIO

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Advisor Class
	Year Ended October 31, 2015			May 7, 2014(a) to October 31, 2014
Net asset value, beginning of period		$  10.01			$  10.00
Income From Investment Operations
Net investment income(b)(c)		.12			.10
Net realized and unrealized loss on investment and foreign currency transactions		(.17	)		(.04	)
Contributions from Affiliates		.00	(d)		– 0	–
Net increase (decrease) in net asset value from operations		(.05	)		.06
Less: Dividends
Dividends from net investment income		(.09	)		(.05	)
Net asset value, end of period		$    9.87			$  10.01
Total Return
Total investment return based on net asset value(e)*		(.45	)%		.70	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$20,967			$20,892
Ratio to average net assets of:
Expenses, net of waivers/reimbursements(f)		4.67	%		2.79	%^
Expenses, before waivers/reimbursements(f)		6.91	%		5.37	%^
Net investment income(c)		1.20	%		2.01	%^
Portfolio turnover rate		163	%		69	%
Portfolio turnover rate (including securities sold short)		147	%		102	%

See footnote summary on page 70.

AB CREDIT LONG/SHORT PORTFOLIO  • 69

Financial Highlights

(a) Commencement of operations.

(b) Based on average shares outstanding.

(c) Net of fees and expenses waived/reimbursed by the Adviser.

(d) Amount is less than $.005.

(e) Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Initial sales charges or contingent deferred sales charges are not reflected in the calculation of total investment return. Total return does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Total investment return calculated for a period of less than one year is not annualized.

* The net asset value and total return include adjustments in accordance with accounting principles generally accepted in the United States of America for financial reporting purposes. As such, the net asset value and total return for shareholder transactions may differ from financial statements.

(f) The expense ratios presented below exclude expenses on securities sold short:

	Year Ended October 31, 2015			May 7, 2014(a) to October 31, 2014
Class A
Net of waivers/reimbursements		1.35	%		1.35	%^
Before waivers/reimbursements		3.61	%		2.08	%^
Class C
Net of waivers/reimbursements		2.10	%		2.10	%^
Before waivers/reimbursements		4.40	%		4.24	%^
Advisor Class
Net of waivers/reimbursements		1.10	%		1.10	%^
Before waivers/reimbursements		3.34	%		3.68	%^

^ Annualized.

See notes to financial statements.

70 •  AB CREDIT LONG/SHORT PORTFOLIO

Financial Highlights

REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

To the Board of Directors of AB Bond Fund, Inc. and

Shareholders of AB Credit Long/Short Portfolio

We have audited the accompanying statement of assets and liabilities, including the portfolio of investments, of AB Credit Long/Short Portfolio (the “Fund”), formerly known as AllianceBernstein Credit Long/Short Portfolio (one of the portfolios constituting the AB Bond Fund, Inc., formerly known as AllianceBernstein Bond Fund, Inc.), as of October 31, 2015, the related statement of operations for the year then ended, and the statements of changes in net assets and financial highlights for the year then ended and the period May 7, 2014 (commencement of operations) to October 31, 2014. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Fund’s internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of October 31, 2015, by correspondence with the custodian and others or by other appropriate auditing procedures where replies from others were not received. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of AB Credit Long/Short Portfolio (one of the portfolios constituting the AB Bond Fund, Inc.) at October 31, 2015, the results of its operations for the year then ended, and the statements of changes in net assets and financial highlights for the year then ended and the period May 7, 2014 (commencement of operations) to October 31, 2014, in conformity with U.S. generally accepted accounting principles.

New York, New York

December 30, 2015

AB CREDIT LONG/SHORT PORTFOLIO  • 71

Report of Independent Registered Public Accounting Firm

2015 FEDERAL TAX INFORMATION

(unaudited)

For Federal income tax purposes, the following information is furnished with respect to the distributions paid by the Portfolio during the taxable year ended October 31, 2015. For corporate shareholders, 12.97% of dividends paid qualify for the dividends received deduction. For foreign shareholders, 23.34% of ordinary dividends paid may be considered to be qualifying to be taxed as interest-related dividends.

For the taxable year ended October 31, 2015, the Portfolio designates $33,162 as the maximum amount that may be considered qualified dividend income for individual shareholders.

Shareholders should not use the above information to prepare their income tax returns. The information necessary to complete your income tax returns will be included with your form 1099-DIV which will be sent to you separately in January 2016.

72 •  AB CREDIT LONG/SHORT PORTFOLIO

BOARD OF DIRECTORS

Marshall C. Turner, Jr.⁽¹⁾, Chairman John H. Dobkin⁽¹⁾ Michael J. Downey⁽¹⁾ William H. Foulk, Jr.⁽¹⁾ D. James Guzy⁽¹⁾ Nancy P. Jacklin⁽¹⁾ Robert M. Keith, President and Chief Executive Officer Garry L. Moody⁽¹⁾ Earl D. Weiner⁽¹⁾

OFFICERS

Philip L. Kirstein, Senior Vice President and Independent Compliance Officer Gershon M. Distenfeld⁽²⁾, Vice President Sherif M. Hamid⁽²⁾, Vice President Ivan Rudolph-Shabinsky⁽²⁾, Vice President Robert Schwartz⁽²⁾, Vice President Ashish C. Shah⁽²⁾, Vice President Joseph J. Mantineo, Treasurer and Chief Financial Officer Emilie D. Wrapp, Secretary Phyllis J. Clarke, Controller Vincent S. Noto, Chief Compliance Officer

Custodian and Accounting Agent State Street Bank and Trust Company State Street Corporation CCB/5 1 Iron Street Boston, MA 02210   Principal Underwriter AllianceBernstein Investments, Inc. 1345 Avenue of the Americas New York, NY 10105   Transfer Agent AllianceBernstein Investor Services, Inc. P.O. Box 786003 San Antonio, TX 78278-6003 Toll-Free (800) 221-5672 Independent Registered Public Accounting Firm Ernst & Young LLP 5 Times Square New York, NY 10036   Legal Counsel Seward & Kissel LLP One Battery Park Plaza New York, NY 10004

(1) Member of the Audit Committee, the Governance and Nominating Committee and the Independent Directors Committee.

(2) The day-to-day management of, and investment decisions for, the Fund are made by the Credit Long/Short Investment Team. Messrs. Distenfeld, Hamid, Rudolph-Shabinksy, Schwartz and Shah are the investment professionals with the most significant responsibility for the day-to-day management of the Fund’s portfolio.

AB CREDIT LONG/SHORT PORTFOLIO  • 73

Board of Directors

MANAGEMENT OF THE FUND

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD
INTERESTED DIRECTOR
Robert M. Keith, + 1345 Avenue of the Americas New York, NY 10105 55 (2014)	Senior Vice President of AllianceBernstein L.P. (the “Adviser”) and the head of AllianceBernstein Investments, Inc. (“ABI”) since July 2008; Director of ABI and President of the AB Mutual Funds. Previously, he served as Executive Managing Director of ABI from December 2006 to June 2008. Prior to joining ABI in 2006, Executive Managing Director of Bernstein Global Wealth Management, and prior thereto, Senior Managing Director and Global Head of Client Service and Sales of the Adviser’s institutional investment management business since 2004. Prior thereto, he was Managing Director and Head of North American Client Service and Sales in the Adviser’s institutional investment management business, with which he had been associated since prior to 2004.		110	None

74 •  AB CREDIT LONG/SHORT PORTFOLIO

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD
DISINTERESTED DIRECTORS
Marshall C. Turner, Jr., # Chairman of the Board 74 (2014)	Private Investor since prior to 2010. Former Chairman and CEO of Dupont Photomasks, Inc. (components of semi-conductor manufacturing). He has extensive operating leadership and venture capital investing experience, including five interim or full-time CEO roles, and prior service as general partner of institutional venture capital partnerships. He also has extensive non-profit board leadership experience, and currently serves on the boards of two education and science-related non-profit organizations. He has served as a director of one AB fund since 1992, and director or trustee of multiple AB Funds since 2005. He has been Chairman of the AB Funds since January 2014, and the Chairman of the Independent Directors Committees of such Funds since February 2014.		110	Xilinx, Inc. (programmable logic semi-conductors) since 2007
John H. Dobkin, # 73 (2014)	Independent Consultant since prior to 2010. Formerly, President of Save Venice, Inc. (preservation organization) from 2001–2002; Senior Advisor from June 1999-June 2000 and President of Historic Hudson Valley (historic preservation) from December 1989-May 1999. Previously, Director of the National Academy of Design. He has served as a director or trustee of various AB Funds since 1992, and as Chairman of the Audit Committees of a number of such Funds from 2001-2008.		110	None

AB CREDIT LONG/SHORT PORTFOLIO  • 75

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD
DISINTERESTED DIRECTORS (continued)
Michael J. Downey, # 71 (2014)	Private Investor since prior to 2010. Formerly, managing partner of Lexington Capital, LLC (investment advisory firm) from December 1997 until December 2003. He served as Director of The Merger Fund (registered investment company) since prior to 2010 until 2013. He served as a Director of Prospect Acquisition Corp. (financial services) from 2007 until 2009. From 1987 until 1993, Chairman and CEO of Prudential Mutual Fund Management, director of the Prudential mutual funds, and member of the Executive Committee of Prudential Securities Inc. He has served as a director or trustee of the AB Funds since 2005 and is a director and Chairman of one other registered investment company.		110	Asia Pacific Fund, Inc. (registered investment company) since prior to 2010
William H. Foulk, Jr., # 83 (2014)	Investment Adviser and an Independent Consultant since prior to 2010. Previously, he was Senior Manager of Barrett Associates, Inc., a registered investment adviser. He was formerly Deputy Comptroller and Chief Investment Officer of the State of New York and, prior thereto, Chief Investment Officer of the New York Bank for Savings. He has served as a director or trustee of various AB Funds since 1983, and was Chairman of the Independent Directors Committees of the AB Funds from 2003 until early February 2014. He served as Chairman of such Funds from 2003 through December 2013. He is also active in a number of mutual fund related organizations and committees.		110	None

76 •  AB CREDIT LONG/SHORT PORTFOLIO

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD
DISINTERESTED DIRECTORS (continued)
D. James Guzy, # 79 (2014)	Chairman of the Board of SRC Computers, Inc. (semi-conductors), with which he has been associated since prior to 2010. He served as Chairman of the Board of PLX Technology (semi-conductors) since prior to 2010 until November 2013. He was a Director of Cirrus Logic Corporation (semi-conductors) from 1984 until July 2011. He was a director of Intel Corporation (semi-conductors) from 1969 until 2008, and served as Chairman of the Finance Committee of such company for several years until May 2008. He has served as a director or trustee of one or more of the AB Funds since 1982.		110	None
Nancy P. Jacklin, # 67 (2014)	Professorial Lecturer at the Johns Hopkins School of Advanced International Studies (2008-2015) U.S. Executive Director of the International Monetary Fund (which is responsible for ensuring the stability of the international monetary system), (December 2002-May 2006); Partner, Clifford Chance (1992-2002); Sector Counsel, International Banking and Finance, and Associate General Counsel, Citicorp (1985-1992); Assistant General Counsel (International), Federal Reserve Board of Governors (1982-1985); and Attorney Advisor, U.S. Department of the Treasury (1973-1982). Member of the Bar of the District of Columbia and of New York; and member of the Council on Foreign Relations. She has served as a director or trustee of the AB Funds since 2006 and has been Chairman of the Governance and Nominating Committees of the Funds since August 2014.		110	None

AB CREDIT LONG/SHORT PORTFOLIO  • 77

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD
DISINTERESTED DIRECTORS (continued)
Garry L. Moody, # 63 (2014)	Independent Consultant. Formerly, Partner, Deloitte & Touche LLP (1995-2008) where he held a number of senior positions, including Vice Chairman, and U.S. and Global Investment Management Practice Managing Partner; President, Fidelity Accounting and Custody Services Company (1993-1995); and Partner, Ernst & Young LLP (1975-1993), where he served as the National Director of Mutual Fund Tax Services and Managing Partner of its Chicago Office Tax department. He is a member of the Trustee Advisory Board of BoardIQ, a biweekly publication focused on issues and news affecting directors of mutual funds. He has served as a director or trustee, and as Chairman of the Audit Committees, of the AB Funds since 2008.		110	None
Earl D. Weiner, # 76 (2014)	Of Counsel, and Partner prior to January 2007, of the law firm Sullivan & Cromwell LLP and is a former member of the ABA Federal Regulation of Securities Committee Task Force to draft editions of the Fund Director’s Guidebook. He also serves as a director or trustee of various non-profit organizations and has served as Chairman or Vice Chairman of a number of them. He has served as a director or trustee of the AB Funds since 2007 and served as Chairman of the Governance and Nominating Committees of the AB Funds from 2007 until August 2014.		110	None

78 •  AB CREDIT LONG/SHORT PORTFOLIO

Management of the Fund

* The address for each of the Fund’s disinterested Directors is c/o AllianceBernstein L.P., Attention: Philip L. Kirstein, 1345 Avenue of the Americas, New York, NY 10105.

** There is no stated term of office for the Fund’s Directors.

*** The information above includes each Director’s principal occupation during the last five years and other information relating to the experience, attributes and skills relevant to each Director’s qualifications to serve as a Director, which led to the conclusion that each Director should serve as a Director for the Fund.

+ Mr. Keith is an “interested person” of the Portfolio as defined in the Investment Company Act of 1940, due to his position as a Senior Vice President of the Adviser.

# Member of the Audit Committee, the Governance and Nominating Committee and the Independent Directors Committee.

AB CREDIT LONG/SHORT PORTFOLIO  • 79

Management of the Fund

Officer Information

Certain information concerning the Fund’s Officers is listed below.

NAME, ADDRESS*, AND AGE	POSITION(S) HELD WITH FUND	PRINCIPAL OCCUPATION DURING PAST 5 YEARS
Robert M. Keith 55	President and Chief Executive Officer	See biography above.
Philip L. Kirstein 70	Senior Vice President and Independent Compliance Officer	Senior Vice President and Independent Compliance Officer of the AB Funds, with which he has been associated since October 2004. Prior thereto, he was Of Counsel to Kirkpatrick & Lockhart, LLP from October 2003 to October 2004, and General Counsel of Merrill Lynch Investment Managers, L.P. since prior to March 2003.
Gershon M. Distenfeld 40	Vice President	Senior Vice President of the Adviser**, with which he has been associated since prior to 2010.
Sherif M. Hamid 39	Vice President	Senior Vice President of the Adviser**, with which he has been associated since 2013 and Portfolio Manager for High Yield. Prior to joining the Adviser, he was at Barclays Capital where he was head of European Credit Strategy from 2011 to 2013, and a U.S. investment-grade credit strategist and U.S. high yield analyst from prior to 2010.
Robert Schwartz 43	Vice President	Senior Vice President of the Adviser**, with which he has been associated since 2012 and Corporate Credit Research Analyst. Prior thereto, he was a senior credit analyst at Bell Point Capital Management from 2010 until 2012, a senior credit analyst at Litespeed Partners since prior to 2010.
Ivan Rudolph-Shabinsky 51	Vice President	Senior Vice President of the Adviser**, with which he has been associated since prior to 2010.
Ashish C. Shah 45	Vice President	Senior Vice President and Head of Global Credit of the Adviser** with which he has been associated since May 2010 and Chief Diversity Officer since 2014. Previously he was a Managing Director and Head of Global Credit Strategy at Barclays Capital since prior to 2010.
Emilie D. Wrapp 59	Secretary	Senior Vice President, Assistant General Counsel and Assistant Secretary of ABI**, with which she has been associated since prior to 2010.

80 •  AB CREDIT LONG/SHORT PORTFOLIO

Management of the Fund

NAME, ADDRESS*, AND AGE	POSITION(S) HELD WITH FUND	PRINCIPAL OCCUPATION DURING PAST 5 YEARS
Joseph J. Mantineo 56	Treasurer and Chief Financial Officer	Senior Vice President of ABIS**, with which he has been associated since prior to 2010.
Vincent S. Noto 50	Chief Compliance Officer	Senior Vice President since 2015 and Mutual Fund Chief Compliance Officer of the Adviser** since 2014. Prior thereto, he was Vice President and Director of Mutual Fund Compliance of the Adviser** since prior to 2010.
Phyllis J. Clarke 54	Controller	Vice President of ABIS**, with which she has been associated since prior to 2010.

* The address for each of the Fund’s Officers is 1345 Avenue of the Americas, New York, NY 10105.

** The Adviser, ABI and ABIS are affiliates of the Fund.

The Fund’s Statement of Additional Information (“SAI”) has additional information about the Fund’s Directors and Officers and is available without charge upon request. Contact your financial representative or AB at 1-(800) 227-4618, or visit www.ABglobal.com, for a free prospectus or SAI.

AB CREDIT LONG/SHORT PORTFOLIO  • 81

Management of the Fund

THE FOLLOWING IS NOT PART OF THE SHAREHOLDER REPORT OR THE FINANCIAL STATEMENTS

SUMMARY OF SENIOR OFFICER’S EVALUATION OF INVESTMENT ADVISORY AGREEMENT¹

The following is a summary of the evaluation of the Investment Advisory Agreement between AllianceBernstein L.P. (the “Adviser”) and AB Bond Fund, Inc. (the “Fund”), in respect of AB Credit Long/Short Portfolio (the “Portfolio”),² prepared by Philip L. Kirstein, the Senior Officer of the Fund for the Directors of the Fund, as required by the August 2004 agreement between the Adviser and the New York State Attorney General (the “NYAG”). The Senior Officer’s evaluation of the Investment Advisory Agreement is not meant to diminish the responsibility or authority of the Board of Directors of the Fund to perform its duties pursuant to Section 15 of the Investment Company Act of 1940 (the “40 Act”) and applicable state law. The purpose of the summary is to provide shareholders with a synopsis of the independent evaluation of the reasonableness of the advisory fees proposed to be paid by the Portfolio which was provided to the Directors in connection with their review of the proposed approval of the continuance of the Investment Advisory Agreement.

The Senior Officer’s evaluation considered the following factors:

1. Advisory fees charged to institutional and other clients of the Adviser for like services;

2. Advisory fees charged by other mutual fund companies for like services;

3. Costs to the Adviser and its affiliates of supplying services pursuant to the advisory agreement, excluding any intra-corporate profit;

4. Profit margins of the Adviser and its affiliates from supplying such services;

5. Possible economies of scale as the Portfolio grows larger; and

6. Nature and quality of the Adviser’s services including the performance of the Portfolio.

These factors, with the exception of the first factor, are generally referred to as the “Gartenberg factors,” which were articulated by the United States Court of Appeals for the Second Circuit in 1982. Gartenberg v. Merrill Lynch Asset Management, Inc., 694 F. 2d 923 (2d Cir. 1982). On March 30, 2010, the Supreme Court held the Gartenberg decision was correct in its basic formulation of what Section 36(b) requires: to face liability under Section 36(b), “an investment adviser must charge a fee that is so disproportionately large that it bears no reasonable relationship to the services rendered and could not have been the

1 The information in the fee evaluation was completed on October 22, 2015 and discussed with the Board of Directors on November 3-5, 2015.

2 Future references to the Portfolio do not include “AB.”

82 •  AB CREDIT LONG/SHORT PORTFOLIO

product of arm’s length bargaining.” Jones v. Harris Associates L.P., 130 S. Ct. 1418 (2010). In the Jones decision, the Court stated the Gartenberg approach fully incorporates the correct understanding of fiduciary duty within the context of Section 36(b) and noted with approval that “Gartenberg insists that all relevant circumstances be taken into account” and “uses the range of fees that might result from arm’s length bargaining as the benchmark for reviewing challenged fees.”³

ADVISORY FEES, NET ASSETS, & EXPENSE RATIOS

The Adviser proposed that the Portfolio pays the advisory fee set forth below for receiving the services to be provided pursuant to the Investment Advisory Agreement. Also shown are the Fund’s net assets on September 30, 2015.

Portfolio	Net Assets 9/30/15 ($MM)	Advisory Fee Schedule Based on the Average Daily Net Assets of the Portfolio
Credit Long/Short Portfolio	$21.2	0.90% (as breakpoints)

The Portfolio’s Investment Advisory Agreement provides for the Adviser to be reimbursed for certain clerical, legal, accounting, administrative and other services provided to the Fund. During the Portfolio’s fiscal year ended October 31, 2014, the Adviser received $38,604 (0.190% of the Portfolio’s average daily net assets) for providing such services.

The Adviser has agreed to waive that portion of its management fees and/or reimburse the Portfolio for that portion of the Portfolio’s total operating expenses to the degree necessary to limit the Portfolio’s expense ratio to the amounts set forth below for the Portfolio’s current fiscal year. The waiver is terminable by the Adviser at the end of the Portfolio’s fiscal year upon at least 60 days’ notice prior to the Portfolio’s prospectus update. In addition, set forth below are the Portfolio’s gross expense ratios for the most recent semi-annual period:⁴

Portfolio	Expense Cap Pursuant to Expense Limitation Undertaking		Gross Expense Ratio5		Fiscal Year End
Credit Long/Short Portfolio6, 7, 8	Advisor Class A Class C	1.10% 1.35% 2.10%		3.33% 3.62% 4.41%	October 31 (ratios as of April 30, 2015)

3 Jones v. Harris at 1427.

4 Semi-annual total expense ratios are unaudited.

5 Annualized.

6 The Rule 12b-1 fee for Class A shares of the Portfolio is 0.25%.

7 The Portfolio’s expense ratios exclude expenses on securities sold short of 3.13%, 3.19%, and 3.21% for Advisor Class, Class A, and Class C shares, respectively.

8 The Portfolio’s fiscal percentage of net assets allocated to ETFs as of July 31, 2015 is 0.24%. The Portfolio’s acquired funds expense ratio related to such ETF holdings is 0.0002%.

AB CREDIT LONG/SHORT PORTFOLIO  • 83

I. ADVISORY FEES CHARGED TO INSTITUTIONAL AND OTHER CLIENTS

The advisory fees charged to investment companies which the Adviser manages and sponsors are normally higher than those charged to similar sized institutional accounts, including pension plans and sub-advised investment companies. The fee differential reflects, among other things, different services provided to such clients, and different liabilities assumed. Services provided by the Adviser to the Portfolio that are not provided to non-investment company clients and sub-advised investment companies include providing office space and personnel to serve as Fund Officers, who among other responsibilities, make the certifications required under the Sarbanes–Oxley Act of 2002, and coordinating with and monitoring the Portfolio’s third party service providers such as Fund counsel, auditors, custodians, transfer agents and pricing services. The accounting, administrative, legal and compliance requirements for the Portfolio are more costly than those for institutional assets due to the greater complexities and time required for investment companies, although the Adviser is reimbursed for providing such services. Managing the cash flow of an investment company is more difficult than that of a stable pool of assets, such as an institutional account with little cash movement in either direction, particularly if a fund is in net redemption, and the Adviser is frequently forced to sell securities to raise cash for redemptions. However, managing a fund with positive cash flow may be easier at times than managing a stable pool of assets. In recent years, investment advisers have been sued by institutional clients and have suffered reputational damage both by the attendant publicity and outcomes other than complete victories. Accordingly, the legal and reputational risks associated with institutional accounts are greater than previously thought, although still not equal to those related to the mutual fund industry.

Notwithstanding the Adviser’s view that managing an investment company is not comparable to managing other institutional accounts because the services provided are different, the Supreme Court has indicated consideration should be given to the advisory fees charged to institutional accounts with a similar investment style as the Portfolio.⁹ In addition to the AB Institutional fee schedule, set forth below is what would have been the effective advisory fee for the Portfolio had the AB Institutional fee schedule been applicable to the Portfolio versus the Portfolio’s advisory fees based on September 30, 2015 net assets.¹⁰

9 The Supreme Court stated that “courts may give such comparisons the weight that they merit in light of the similarities and differences between the services that the clients in question require, but the courts must be wary of inapt comparisons.” Among the significant differences the Supreme Court noted that may exist between services provided to mutual funds and institutional accounts are “higher marketing costs.” Jones v. Harris at 1428.

10 The Adviser has indicated that with respect to institutional accounts with assets greater than $300 million, it will negotiate a fee schedule. Discounts that are negotiated vary based upon each client relationship.

84 •  AB CREDIT LONG/SHORT PORTFOLIO

Portfolio	Net Assets 09/30/15 ($MM)	AB Institutional Fee Schedule	Effective AB Inst. Adv. Fee (%)		Portfolio Advisory Fee (%)
Credit Long/Short Portfolio	$21.2	Credit Long/Short Portfolio 0.90% on 1st $200 million 0.80% on next $100 million 0.70% on the balance Minimum account size: $100m		0.900%	0.900%

The Adviser has represented that it does not provide sub-advisory investment services to other investment companies that have a substantially similar investment style as the Portfolio.

II. MANAGEMENT FEES CHARGED BY OTHER MUTUAL FUND COMPANIES FOR LIKE SERVICES.

Broadridge Financial Solutions, Inc. (“Broadridge”), an analytical service that is not affiliated with the Adviser, compared the fees charged to the Portfolio with fees charged to other investment companies for similar services offered by other investment advisers.^11,12 Broadridge’s analysis included the comparison of the Portfolio’s contractual management fee, estimated at the approximate current asset level of the Portfolio, to the median of the Fund’s Broadridge Expense Group (“EG”)¹³ and the Portfolio’s contractual management fee ranking.¹⁴

11 The Supreme Court cautioned against accepting mutual fund fee comparisons without careful scrutiny since “these comparisons are problematic because these fees, like those challenged, may not be the product of negotiations conducted at arm’s length.” Jones v. Harris at 1429.

12 On June 5, 2015, Broadridge acquired the Fiduciary Services and Competitive Intelligence unit, i.e., the group responsible for providing the Portfolio’s 15(c) reports, from Thomson Reuters’ Lipper division. The group that maintains Lipper’s expense and performance databases and investment classifications/objectives remains a part of Thomson Reuters’ Lipper division. Accordingly, the Portfolio’s investment classification/objective continued to be determined by Lipper.

13 Broadridge does not consider average account size when constructing EGs. Funds with relatively small average account sizes tend to have higher transfer agent expense ratios than comparable sized funds that have relatively large average account sizes. There are limitations to Lipper expense category data because different funds categorize expenses differently.

14 The contractual management fee is calculated by Broadridge using the Portfolio’s contractual management fee rate at the hypothetical asset level. The hypothetical asset level is based on the combined net assets of all classes of the Portfolio, rounded up to the next $25 million. Broadridge’s total expense ratio information is based on the most recent annual report except as otherwise noted. A ranking of “1” would mean that Portfolio had the lowest effective fee rate in the Broadridge peer group.

AB CREDIT LONG/SHORT PORTFOLIO  • 85

Broadridge describes an EG as a representative sample of comparable funds. Broadridge’s standard methodology for screening funds to be included in an EG entails the consideration of several fund criteria, including fund type, Lipper investment classification/objective, load type and similar 12b-1/non-12b-1 service fees, asset (size) comparability, expense components and attributes. An EG will typically consist of seven to twenty funds.

Portfolio	Contractual Management Fee  (%)15		Broadridge EG Median (%)		Broadridge EG Rank
Credit Long/Short Portfolio		0.900		1.000	4/13

Broadridge also compared the Portfolio’s total expense ratio to the medians of the Portfolio’s EG and Broadridge Expense Universe (“EU”). The EU is a broader group compared to the EG, consisting of all funds that have the same investment classifications/objective and load type as the subject Portfolio.¹⁶ Set forth below is Broadridge’s comparison of the Portfolio’s total expense ratio and the medians of the Portfolio’s EG and EU.

Portfolio	Expense Ratio (%)17		Broadridge EG Median (%)	Broadridge Group Rank	Broadridge EU Median (%)		Broadridge EU Rank
Credit Long/Short Portfolio		1.350	1.409	4/13		1.200	26/41

Based on this analysis, considering pro-forma information where available, the Portfolio has equally favorable rankings on a total expense ratio basis and on a contractual management fee basis.

III. COSTS TO THE ADVISER AND ITS AFFILIATES OF SUPPLYING SERVICES PURSUANT TO THE MANAGEMENT FEE ARRANGEMENT, EXCLUDING ANY INTRA-CORPORATE PROFIT.

The Adviser utilizes two profitability reporting systems, which operate independently but are aligned with each other, to estimate the Adviser’s profitability in connection with investment advisory services provided to the Portfolio. The Senior Officer has retained a consultant to provide independent advice regarding the alignment of the two profitability systems as well as the methodologies and allocations utilized by both profitability systems. See Section IV for additional discussion.

15 The contractual management fee does not reflect any expense reimbursements made by the Portfolio to the Adviser for certain clerical, legal, accounting, administrative, and other services. In addition, the contractual management fee does not reflect any advisory fee waivers for expense caps.

16 Except for asset (size) comparability, Broadridge uses the same criteria for selecting an EG when selecting an EU. Unlike the EG, the EU allows for the same adviser to be represented by more than just one fund.

17 Most recently completed fiscal year Class A share total expense ratio.

86 •  AB CREDIT LONG/SHORT PORTFOLIO

IV. PROFIT MARGINS OF THE ADVISER AND ITS AFFILIATES FOR SUPPLYING SUCH SERVICES.

The Portfolio’s profitability information, prepared by the Adviser for the Board of Directors, was reviewed by the Senior Officer and the consultant. The Adviser’s profitability from providing investment advisory services to the Portfolio was negative during calendar year 2014.

In addition to the Adviser’s direct profits from managing the Portfolio, certain of the Adviser’s affiliates have business relationships with the Portfolio and may earn a profit from providing other services to the Portfolio. The courts have referred to this type of business opportunity as “fall-out benefits” to the Adviser and indicated that such benefits should be factored into the evaluation of the total relationship between the Portfolio and the Adviser. Neither case law nor common business practice precludes the Adviser’s affiliates from earning a reasonable profit on this type of relationship provided the affiliates’ charges and services are competitive and the relationship otherwise complies with the 40 Act restrictions. These affiliates provide transfer agent and distribution related services to the Portfolio and receive transfer agent fees, Rule 12b-1 payments, front-end sales loads and contingent deferred sales charges (“CDSC”). During the Portfolio’s most recently completed fiscal year, ABI received from the Portfolio $62 and $123 in front-end sales charges and Rule 12b-1 fees, respectively.

AllianceBernstein Investments, Inc. (“ABI”), an affiliate of the Adviser, is the Fund’s principal underwriter. ABI and the Adviser have disclosed in the Portfolio’s prospectus that they may make revenue sharing payments from their own resources, in addition to resources derived from sales loads and Rule 12b-1 fees, to firms that sell shares of the Portfolio. In 2014, ABI paid approximately 0.05% of the average monthly assets of the AB Mutual Funds or approximately $20.4 million for distribution services and educational support (revenue sharing payments).

Fees and reimbursements for out of pocket expenses charged by AllianceBernstein Investor Services, Inc. (“ABIS”), the affiliated transfer agent for the Portfolio, are based on the level of the network account and the class of shares held by the account. ABIS also receives a fee per shareholder sub-account for each account maintained by an intermediary on an omnibus basis. ABIS received $7,509 in fees from the Portfolio during the Portfolio’s most recently completed fiscal year.

V. POSSIBLE ECONOMIES OF SCALE

The Adviser has indicated that economies of scale are being shared with shareholders through pricing to scale, breakpoints, fee reductions/waivers and enhancement to services.

In May 2012, an independent consultant, retained by the Senior Officer, provided the Board of Directors information on the Adviser’s firm-wide average

AB CREDIT LONG/SHORT PORTFOLIO  • 87

costs from 2005 through 2011 and the potential economies of scale. The independent consultant noted that from 2005 through 2007 the Adviser experienced significant growth in assets under management (“AUM”). During this period, operating expenses increased, in part to keep up with growth, and in part reflecting market returns. However, from 2008 through the first quarter of 2009, AUM rapidly and significantly decreased due to declines in market value and client withdrawals. When AUM rapidly decreased, some operating expenses categories, including base compensation and office space, adjusted more slowly during this period, resulting in an increase in average costs. Since 2009, AUM has experienced less significant changes. The independent consultant noted that changes in operating expenses reflect changes in business composition and business practices in response to changes in financial markets. Finally, the independent consultant concluded that the increase in average cost and the decline in net operating margin across the Adviser since late 2008 are inconsistent with the view that there are currently reductions in average costs due to economies of scale that can be shared with the AB Mutual Funds managed by the Adviser through lower fees.

Previously, in February 2008, the independent consultant provided the Board of Directors an update of the Deli¹⁸ study on advisory fees and various fund characteristics.¹⁹ The independent consultant first reiterated the results of his previous two dimensional comparison analysis (fund size and family size) with the Board of Directors.²⁰ The independent consultant then discussed the results of the regression model that was utilized to study the effects of various factors on advisory fees. The regression model output indicated that the bulk of the variation in fees predicted were explained by various factors, but substantially by fund AUM, family AUM, index fund indicator and investment style. The independent consultant also compared the advisory fees of the AB Mutual Funds to similar funds managed by 19 other large asset managers, regardless of the fund size and each Adviser’s proportion of mutual fund assets to non-mutual fund assets.

18 The Deli study, originally published in 2002 based on 1997 data and updated for the February 2008 Presentation, may be of diminished value due to the age of the data used in the presentation and the changes experienced in the industry since 2008.

19 The Supreme Court cautioned against accepting mutual fund fee comparisons without careful scrutiny since the fees may not be the product of negotiations conducted at arm’s length. See Jones v. Harris at 1429.

20 The two dimensional analysis showed patterns of lower advisory fees for funds with larger asset sizes and funds from larger family sizes compared to funds with smaller asset sizes and funds from smaller family sizes, which according to the independent consultant is indicative of a sharing of economies of scale and scope. However, in less liquid and active markets, such is not the case, as the empirical analysis showed potential for diseconomies of scale in those markets. The empirical analysis also showed diminishing economies of scale and scope as funds surpassed a certain high level of assets.

88 •  AB CREDIT LONG/SHORT PORTFOLIO

VI. NATURE AND QUALITY OF THE ADVISER’S SERVICES, INCLUDING THE PERFORMANCE OF THE FUND

With assets under management of approximately $463 billion as of September 30, 2015, the Adviser has the investment experience to manage and provide non-investment services (described in Section I) to the Portfolio.

The information prepared by Broadridge shows the 1 year performance return and rankings²¹ of the Portfolio relative to its Broadridge Performance Group (“PG”) and Broadridge Performance Universe (“PU”)²² for the period ended July 31, 2015.²³

	Fund Return (%)		PG Median (%)		PU Median (%)		PG Rank		PU Rank
Credit Long/Short Portfolio
1 year		-0.42		-0.42		-0.50		7/13		25/50

Set forth below are the 1 year and since inception performance returns of the Portfolio (in bold)²⁴ versus its benchmark.²⁵ Portfolio and benchmark volatility and reward-to-variability ratio (“Sharpe Ratio”) information is also shown.²⁶

	Period Ending July 31, 2015 Annualized Net Performance (%)
	1 Year (%)		Since Inception (%)		Volatility (%)		Sharpe (%)		Risk Period (Year)
Credit Long/Short Portfolio		-0.42		-0.07		2.12		-0.19		1
Bank of America/Merrill Lynch 3 Month U.S. Treasury Bill		0.01		0.02		0.02		N/A		1
Inception Date: May 7, 2014

21 The performance return and rankings are for the Portfolio’s Class A shares. The performance return of the Portfolio was provided by Broadridge.

22 The Portfolio’s PG is identical to the Portfolio’s EG. The Portfolio’s PU is not identical to the Portfolio’s EU as the criteria for including/excluding a fund from a PU is somewhat different from that of an EU.

23 The current Lipper investment classification/objective dictates the PG and PU throughout the life of the Portfolio even if the Portfolio had a different investment classification/objective at a different point in time.

24 The performance returns and risk measures shown in the table are for the Class A shares of the Portfolio.

25 The Adviser provided Portfolio and benchmark performance return information for periods through July 31, 2015.

26 Portfolio and benchmark volatility and Sharpe Ratio information was obtained through Lipper LANA, a database maintained by Lipper. Volatility is a statistical measure of the tendency of a market price or yield to vary over time. A Sharpe Ratio is a risk adjusted measure of return that divides a fund’s return in excess of the riskless return by the fund’s standard deviation. A fund with a greater volatility would be viewed as more risky than a fund with equivalent performance but lower volatility; for that reason, a greater return would be demanded for the more risky fund. A fund with a higher Sharpe Ratio would be viewed as better performing than a fund with a lower Sharpe Ratio.

AB CREDIT LONG/SHORT PORTFOLIO  • 89

CONCLUSION:

Based on the factors discussed above the Senior Officer’s conclusion is that the proposed advisory fee for the Portfolio is reasonable and within the range of what would have been negotiated at arm’s length in light of all the surrounding circumstances. This conclusion in respect of the Portfolio is based on an evaluation of all of these factors and no single factor was dispositive.

Dated: November 25, 2015

90 •  AB CREDIT LONG/SHORT PORTFOLIO

THIS PAGE IS NOT PART OF THE SHAREHOLDER REPORT OR THE FINANCIAL STATEMENTS

AB FAMILY OF FUNDS

US EQUITY

US Core

Core Opportunities Fund

Select US Equity Portfolio

US Growth

Concentrated Growth Fund

Discovery Growth Fund

Growth Fund

Large Cap Growth Fund

Small Cap Growth Portfolio

US Value

Discovery Value Fund

Equity Income Fund

Growth & Income Fund

Small Cap Value Portfolio

Value Fund

INTERNATIONAL/ GLOBAL EQUITY

International/Global Core

Global Core Equity Portfolio

Global Equity & Covered Call Strategy Fund

Global Thematic Growth Fund

International Portfolio

Tax-Managed International Portfolio

International/Global Growth

International Growth Fund

International/Global Value

Asia ex-Japan Equity Portfolio

International Value Fund

FIXED INCOME

Municipal

High Income Municipal Portfolio

Intermediate California Municipal Portfolio

Intermediate Diversified Municipal Portfolio

Intermediate New York Municipal Portfolio

Municipal Bond Inflation Strategy

FIXED INCOME (continued)

Tax-Aware Fixed Income Portfolio

National Portfolio

Arizona Portfolio

California Portfolio

Massachusetts Portfolio

Michigan Portfolio

Minnesota Portfolio

New Jersey Portfolio

New York Portfolio

Ohio Portfolio

Pennsylvania Portfolio

Virginia Portfolio

Taxable

Bond Inflation Strategy

Global Bond Fund

High Income Fund

High Yield Portfolio

Intermediate Bond Portfolio

Limited Duration High Income Portfolio

Short Duration Portfolio

ALTERNATIVES

All Market Real Return Portfolio*

Credit Long/Short Portfolio

Global Real Estate Investment Fund

Long/Short Multi-Manager Fund

Multi-Manager Alternative Strategies Fund

Select US Long/Short Portfolio

Unconstrained Bond Fund

MULTI-ASSET

All Market Growth Portfolio*

All Market Income Portfolio

Emerging Markets Multi-Asset Portfolio

Global Risk Allocation Fund

MULTI-ASSET (continued)

Target-Date

Multi-Manager Select Retirement Allocation Fund

Multi-Manager Select 2010 Fund

Multi-Manager Select 2015 Fund

Multi-Manager Select 2020 Fund

Multi-Manager Select 2025 Fund

Multi-Manager Select 2030 Fund

Multi-Manager Select 2035 Fund

Multi-Manager Select 2040 Fund

Multi-Manager Select 2045 Fund

Multi-Manager Select 2050 Fund

Multi-Manager Select 2055 Fund

Wealth Strategies

Balanced Wealth Strategy

Conservative Wealth Strategy

Wealth Appreciation Strategy

Tax-Managed Balanced Wealth Strategy

Tax-Managed Conservative Wealth Strategy

Tax-Managed Wealth Appreciation Strategy

CLOSED-END FUNDS

AB Multi-Manager Alternative Fund

Alliance California Municipal Income Fund

AllianceBernstein Global High Income Fund

AllianceBernstein Income Fund

AllianceBernstein National Municipal Income Fund

We also offer Exchange Reserves, which serves as the money market fund exchange vehicle for the AB mutual funds. An investment in Exchange Reserves is not a deposit in a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.

Investors should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.abglobal.com or contact your AB representative. Please read the prospectus and/or summary prospectus carefully before investing.

* Prior to December 15, 2014, All Market Growth Portfolio was named Dynamic All Market Fund; All Market Real Return Portfolio was named Real Asset Strategy.

AB CREDIT LONG/SHORT PORTFOLIO  • 91

AB Family of Funds

NOTES

92 •  AB CREDIT LONG/SHORT PORTFOLIO

AB CREDIT LONG/SHORT PORTFOLIO

1345 Avenue of the Americas

New York, NY 10105

800.221.5672

CLS-0151-1015                

OCT    ^10.31.15

ANNUAL REPORT

AB HIGH YIELD PORTFOLIO

Investment Products Offered

• Are Not FDIC Insured

• May Lose Value

• Are Not Bank Guaranteed

Investors should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.abglobal.com or contact your AB representative. Please read the prospectus and/or summary prospectus carefully before investing.

This shareholder report must be preceded or accompanied by the Fund’s prospectus for individuals who are not current shareholders of the Fund.

You may obtain a description of the Fund’s proxy voting policies and procedures, and information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30, without charge. Simply visit AB’s website at www.abglobal.com, or go to the Securities and Exchange Commission’s (the “Commission”) website at www.sec.gov, or call AB at (800) 227-4618.

The Fund files its complete schedule of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q are available on the Commission’s website at www.sec.gov. The Fund’s Forms N-Q may also be reviewed and copied at the Commission’s Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330. AB publishes full portfolio holdings for the Fund monthly at www.abglobal.com.

AllianceBernstein Investments, Inc. (ABI) is the distributor of the AB family of mutual funds. ABI is a member of FINRA and is an affiliate of AllianceBernstein L.P., the Adviser of the funds.

The [A/B] logo is a registered service mark of AllianceBernstein and AllianceBernstein^® is a registered service mark used by permission of the owner, AllianceBernstein L.P.

December 11, 2015

Annual Report

This report provides management’s discussion of fund performance for AB High Yield Portfolio (the “Fund”) for the annual reporting period ended October 31, 2015. Effective January 20, 2015, the Fund’s name changed from AllianceBernstein High Yield Portfolio to AB High Yield Portfolio.

Investment Objectives and Policies

The Fund’s investment objective is to seek to maximize total return consistent with prudent investment management. At least 80% of the Fund’s net assets will under normal circumstances be invested in fixed-income securities rated Ba1 or lower by Moody’s Investors Service (“Moody’s”) or BB+ or lower by Standard & Poor’s Ratings Services (“S&P”) or Fitch Ratings (commonly known as “junk bonds”), unrated securities considered by AllianceBernstein L.P. (the “Adviser”) to be of comparable quality, and related derivatives. The Fund may invest in fixed-income securities with a range of maturities from short- to long-term. The Fund may also invest in equity securities.

In selecting securities for purchase or sale by the Fund, the Adviser attempts to take advantage of inefficiencies that it believes exist in the global debt markets. These inefficiencies arise from investor behavior, market complexity, and the investment limitations to which investors are subject. The Adviser combines quantitative analysis with fundamental credit and economic research in seeking to exploit these inefficiencies.

The Fund will most often invest in securities of US issuers, but may also purchase

fixed-income securities of foreign issuers, including securities denominated in foreign currencies. Fluctuations in currency exchange rates can have a dramatic impact on the returns of fixed-income securities denominated in foreign currencies. The Adviser may or may not hedge any foreign currency exposure through the use of currency-related derivatives.

The Fund expects to use derivatives, such as options, futures, forwards and swaps, to a significant extent. Derivatives may provide a more efficient and economical exposure to market segments than direct investments, and may also be a more efficient way to alter the Fund’s exposure. The Fund may, for example, use credit default and interest rate swaps to gain exposure to the fixed-income markets or particular fixed-income securities and, as noted above, may use currency derivatives. The Adviser may use derivatives to effectively leverage the Fund by creating aggregate market exposure substantially in excess of the Fund’s net assets.

Investment Results

The table on page 5 shows the Fund’s performance compared to its benchmark, the Barclays US Corporate High Yield (“HY”) 2% Issuer Capped Index, for the six- and 12-month periods ended October 31, 2015.

All share classes of the Fund underperformed the benchmark for the 12-month period; for the six-month period all shares classes underperformed with the exception of Class I and Class Z shares, before sales charges. Sector positioning contributed for both periods, specifically an overweight to

AB HIGH YIELD PORTFOLIO  • 1

collateralized mortgage obligations and bank loans, relative to the benchmark. An underweight to basic materials and energy, as well as an overweight to banking, contributed for both periods. Security selection within energy and telecommunications holdings detracted for both periods. Yield-curve positioning detracted for both periods, mainly from an underweight to the five-year part of the curve. Currency and country positioning did not have a material impact on returns for either period.

The Fund utilized derivatives in the form of Treasury futures and written options for hedging purposes, interest rate swaps and total return swaps for investment purposes, and currency forwards and credit default swaps for hedging and investment purposes, which had an immaterial impact on performance during both periods, in absolute terms. Purchased options for hedging purposes had an immaterial impact for the six-month period and detracted from returns for the 12-month period.

Market Review and Investment Strategy

Bond markets were volatile for the 12-month period ended October 31, 2015, as growth trends and monetary policies in the world’s biggest economies headed in different directions. Inflation continued to fall throughout the developed world, driven primarily by decreasing commodity prices. While oil prices began to rebound in April, they again fell in August, remaining

well below their price range in late 2014. These dynamics caused volatility within government bond yields, with the yield on the 10-year US Treasury ranging from 1.7% to 2.5%, ultimately ending the period at 2.2%. Adding to the volatility, the US Federal Reserve postponed its long expected interest-rate hike, alluding to emerging market turmoil as one of the reasons.

In other markets, including many in Europe where the European Central Bank implemented its quantitative easing program, some yields ended the period in negative territory. In emerging markets, political and economic instability across regions negatively affected the investment environment. Slower growth in China, Brazil and other emerging market economies caused further pressure on credit markets at the end of the 12-month period. Against this backdrop, fixed-income returns diverged between regions and sectors. Credit securities generally underperformed developed market Treasuries; developed market Treasuries generally outperformed emerging market local currency Treasuries; and investment-grade securities generally outperformed high-yield, which posted some of the worst returns across the fixed-income market. There was significant divergence of returns in the corporate high-yield market. The metals/mining and energy sectors were the worst performers as commodity prices continued to fall. However, consumer related sectors including food/beverages, gaming/lodging/leisure and retail posted positive returns.

2 •  AB HIGH YIELD PORTFOLIO

DISCLOSURES AND RISKS

Benchmark Disclosure

The unmanaged Barclays US Corporate High Yield 2% Issuer Capped Index does not reflect fees and expenses associated with the active management of a mutual fund portfolio. The Barclays US Corporate HY 2% Issuer Capped Index is the 2% Issuer Capped component of the US Corporate High Yield Index. The Barclays US Corporate HY Index represents the performance of fixed-income securities having a maximum quality rating of Ba1, a minimum amount outstanding of $150 million and at least one year to maturity. An investor cannot invest directly in an index or average, and their results are not indicative of the performance for any specific investment, including the Fund.

A Word About Risk

Market Risk: The value of the Fund’s assets will fluctuate as the bond or stock market fluctuates. The value of its investments may decline, sometimes rapidly and unpredictably, simply because of economic changes or other events that affect large portions of the market.

Interest Rate Risk: Changes in interest rates will affect the value of investments in fixed-income securities. When interest rates rise, the value of investments in fixed-income securities tends to fall and this decrease in value may not be offset by higher income from new investments. The Fund may be subject to a greater risk of rising interest rates due to the current period of historically low rates and the effect of government fiscal policy initiatives, including Federal Reserve actions, and market reaction to these initiatives. The current period of historically low rates is expected to end and rates are expected to begin rising in the near future. Interest rate risk is generally greater for fixed-income securities with longer maturities or durations.

Credit Risk: An issuer or guarantor of a fixed-income security, or the counterparty to a derivatives or other contract, may be unable or unwilling to make timely payments of interest or principal, or to otherwise honor its obligations. The issuer or guarantor may default, causing a loss of the full principal amount of a security. The degree of risk for a particular security may be reflected in its credit rating. There is the possibility that the credit rating of a fixed-income security may be downgraded after purchase, which may adversely affect the value of the security.

Below Investment Grade Securities Risk: Investments in fixed-income securities with lower ratings are subject to a higher probability that an issuer will default or fail to meet its payment obligations. These securities may be subject to greater price volatility, due to such factors as specific corporate developments, negative perception of the junk bond market generally and less secondary market liquidity. These securities are often able to be “called” or repurchased by the issuer prior to their maturity date, forcing the Fund to reinvest the proceeds, possibly at a lower rate of return.

Inflation Risk: This is the risk that the value of assets or income from investments will be less in the future as inflation decreases the value of money. As inflation increases, the value of the Fund’s assets can decline as can the value of the Fund’s distributions. This risk is significantly greater if the Fund invests a significant portion of its assets in fixed-income securities with longer maturities.

Derivatives Risk: Investments in derivatives may be illiquid, difficult to price, and leveraged so that small changes may produce disproportionate losses for the Fund, and may be subject to counterparty risk to a greater degree than more traditional investments.

Leverage Risk: To the extent the Fund uses leveraging techniques, its net asset value (“NAV”) may be more volatile because leverage tends to exaggerate the effect of changes in interest rates and any increase or decrease in the value of the Fund’s investments.

(Disclosures, Risks and Note about Historical Performance continued on next page)

AB HIGH YIELD PORTFOLIO  • 3

Disclosures and Risks

DISCLOSURES AND RISKS

(continued from previous page)

Foreign (Non-US) Risk: Investments in securities of non-US issuers may involve more risk than those of US issuers. These securities may fluctuate more widely in price and may be less liquid due to adverse market, economic, political, regulatory or other factors. These risks may be heightened with respect to investments in emerging-market countries, where there may be an increased amount of economic, political and social instability.

Emerging Market Risk: Investments in emerging market countries may have more risk because the markets are less developed and less liquid as well as being subject to increased economic, political, regulatory or other uncertainties.

Currency Risk: Fluctuations in currency exchange rates may negatively affect the value of the Fund’s investments or reduce its returns.

Diversification Risk: The Fund may have more risk because it is “non-diversified”, meaning that it can invest more of its assets in a smaller number of issuers. Accordingly, changes in the value of a single security may have a more significant effect, either negative or positive, on the Fund’s NAV.

Liquidity Risk: Liquidity risk occurs when certain investments become difficult to purchase or sell. Difficulty in selling less liquid securities may result in sales at disadvantageous prices affecting the value of your investment in the Fund. Causes of liquidity risk may include low trading volumes, large positions and heavy redemptions of Fund shares. Over recent years liquidity risk has also increased because the capacity of dealers in the secondary market for fixed-income securities to make markets in these securities has decreased, even as the overall bond market has grown significantly, due to, among other things, structural changes, additional regulatory requirements and capital and risk restraints that have led to reduced inventories. Liquidity risk may be higher in a rising interest rate environment, when the value and liquidity of fixed-income securities generally go down.

Management Risk: The Fund is subject to management risk because it is an actively-managed investment fund. The Adviser will apply its investment techniques and risk analyses in making investment decisions, but there is no guarantee that its techniques will produce the intended results.

These risks are fully discussed in the Fund’s prospectus. As with all investments, you may lose money by investing in the Fund.

An Important Note About Historical Performance

The investment return and principal value of an investment in the Fund will fluctuate, so that shares, when redeemed, may be worth more or less than their original cost. Performance shown on the following pages represents past performance and does not guarantee future results. Current performance may be lower or higher than the performance information shown. You may obtain performance information current to the most recent month-end by visiting www.abglobal.com. The Fund has been in operation only for a short period of time, and therefore has a very limited historical performance period. This limited performance period is unlikely to be representative of the performance the Fund will achieve over a longer period.

All fees and expenses related to the operation of the Fund have been deducted. NAV returns do not reflect sales charges; if sales charges were reflected, the Fund’s quoted performance would be lower. SEC returns reflect the applicable sales charges for each share class: a 4.25% maximum front-end sales charge for Class A shares and a 1% 1-year contingent deferred sales charge for Class C shares. Returns for the different share classes will vary due to different expenses associated with each class. Performance assumes reinvestment of distributions and does not account for taxes.

4 •  AB HIGH YIELD PORTFOLIO

Disclosures and Risks

HISTORICAL PERFORMANCE

THE FUND VS. ITS BENCHMARK PERIODS ENDED OCTOBER 31, 2015 (unaudited)	NAV Returns
	6 Months		12 Months
AB High Yield Portfolio
Class A		-3.46%		-2.19%
Class C		-3.82%		-2.95%
Advisor Class*		-3.44%		-1.94%
Class R*		-3.58%		-2.42%
Class K*		-3.45%		-2.17%
Class I*		-3.34%		-1.94%
Class Z*		-3.33%		-1.93%
Barclays US Corporate HY 2% Issuer Capped Index		-3.38%		-1.91%
*    Please note that these share classes are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Fund.

GROWTH OF A $10,000 INVESTMENT IN THE FUND 7/15/14* TO 10/31/15 (unaudited)

This chart illustrates the total value of an assumed $10,000 investment in AB High Yield Portfolio Class A shares (from 7/15/14* to 10/31/15) as compared to the performance of the Fund’s benchmark. The chart reflects the deduction of the maximum 4.25% sales charge from the initial $10,000 investment in the Fund and assumes the reinvestment of dividends and capital gains distributions.

* Inception date: 7/15/2014.

See Disclosures, Risks and Note about Historical Performance on pages 3-4.

(Historical Performance continued on next page)

AB HIGH YIELD PORTFOLIO  • 5

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

AVERAGE ANNUAL RETURNS AS OF OCTOBER 31, 2015 (unaudited)
	NAV Returns			SEC Returns (reflects applicable sales charges)			SEC Yields*
Class A Shares								0.39	%
1 Year		-2.19	%		-6.35	%
Since Inception†		-1.66	%		-4.87	%
Class C Shares								-0.32	%
1 Year		-2.95	%		-3.88	%
Since Inception†		-2.41	%		-2.41	%
Advisor Class Shares‡								0.52	%
1 Year		-1.94	%		-1.94	%
Since Inception†		-1.39	%		-1.39	%
Class R Shares‡								0.79	%
1 Year		-2.42	%		-2.42	%
Since Inception†		-1.89	%		-1.89	%
Class K Shares‡								0.75	%
1 Year		-2.17	%		-2.17	%
Since Inception†		-1.65	%		-1.65	%
Class I Shares‡								1.16	%
1 Year		-1.94	%		-1.94	%
Since Inception†		-1.41	%		-1.41	%
Class Z Shares‡								1.29	%
1 Year		-1.93	%		-1.93	%
Since Inception†		-1.40	%		-1.40	%

The Fund’s prospectus fee table shows the Fund’s total annual operating expense ratios as 49.84%, 56.89%, 33.51%, 4.84%, 4.56%, 4.27% and 4.30% for Class A, Class C, Advisor Class, Class R, Class K, Class I and Class Z shares, respectively, gross of any fee waivers or expense reimbursements. Contractual fee waivers and/or expense reimbursements limit the Fund’s annual operating expenses to 1.05%, 1.80%, 0.80%, 1.30%, 1.05%, 0.80% and 0.80% for Class A, Class C, Advisor Class, Class R, Class K, Class I and Class Z shares, respectively. These waivers/reimbursements may not be terminated before January 29, 2016 and may be extended by the Adviser for additional one-year terms. Absent reimbursements or waivers, performance would have been lower. The Financial Highlights section of this report sets forth expense ratio data for the current reporting period; the expense ratios shown above may differ from the expense ratios in the Financial Highlights sections since they are based on different time periods.

* SEC yields are calculated based on SEC guidelines for the 30-day period ended October 31, 2015.

^†  Inception date: 7/15/2014.

^‡  These share classes are offered at NAV to eligible investors and their SEC returns are the same as their NAV returns. Please note that these share classes are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Fund. The inception date for these share classes is listed above.

See Disclosures, Risks and Note about Historical Performance on pages 3-4.

(Historical Performance continued on next page)

6 •  AB HIGH YIELD PORTFOLIO

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

SEC AVERAGE ANNUAL RETURNS AS OF THE MOST RECENT CALENDAR QUARTER-END SEPTEMBER 30, 2015 (unaudited)
	SEC Returns (reflects applicable sales charges)
Class A Shares
1 Year		-8.04	%
Since Inception†		-7.53	%
Class C Shares
1 Year		-5.58	%
Since Inception†		-4.92	%
Advisor Class Shares‡
1 Year		-3.66	%
Since Inception†		-3.92	%
Class R Shares‡
1 Year		-4.14	%
Since Inception†		-4.41	%
Class K Shares‡
1 Year		-3.91	%
Since Inception†		-4.17	%
Class I Shares‡
1 Year		-3.68	%
Since Inception†		-3.93	%
Class Z Shares‡
1 Year		-3.67	%
Since Inception†		-3.93	%

^†  Inception date: 7/15/2014.

^‡  These share classes are offered at NAV to eligible investors and their SEC returns are the same as their NAV returns. Please note that these share classes are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Fund. The inception date for these share classes is listed above.

See Disclosures, Risks and Note about Historical Performance on pages 3-4.

AB HIGH YIELD PORTFOLIO  • 7

Historical Performance

EXPENSE EXAMPLE

(unaudited)

As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, contingent deferred sales charges on redemptions and (2) ongoing costs, including management fees; distribution (12b-1) fees; and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period as indicated below.

Actual Expenses

The first line of the table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed annual rate of return of 5% before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds by comparing this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

	Beginning Account Value May 1, 2015		Ending Account Value October 31, 2015		Expenses Paid During Period*		Annualized Expense Ratio*
Class A
Actual	$	1,000	$	965.40	$	5.20		1.05	%
Hypothetical**	$	1,000	$	1,019.91	$	5.35		1.05	%
Class C
Actual	$	1,000	$	961.80	$	8.90		1.80	%
Hypothetical**	$	1,000	$	1,016.13	$	9.15		1.80	%
Advisor Class
Actual	$	1,000	$	965.60	$	3.96		0.80	%
Hypothetical**	$	1,000	$	1,021.17	$	4.08		0.80	%
Class R
Actual	$	1,000	$	964.20	$	6.44		1.30	%
Hypothetical**	$	1,000	$	1,018.65	$	6.61		1.30	%
Class K
Actual	$	1,000	$	965.50	$	5.20		1.05	%
Hypothetical**	$	1,000	$	1,019.91	$	5.35		1.05	%
Class I
Actual	$	1,000	$	966.60	$	3.97		0.80	%
Hypothetical**	$	1,000	$	1,021.17	$	4.08		0.80	%
Class Z
Actual	$	1,000	$	966.70	$	3.97		0.80	%
Hypothetical**	$	1,000	$	1,021.17	$	4.08		0.80	%

* Expenses are equal to the classes’ annualized expense ratios multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).

** Assumes 5% annual return before expenses.

8 •  AB HIGH YIELD PORTFOLIO

Expense Example

PORTFOLIO SUMMARY

October 31, 2015 (unaudited)

PORTFOLIO STATISTICS

Net Assets ($mil): $19.7

* All data are as of October 31, 2015. The Fund’s security type breakdown is expressed as a percentage of total investments and may vary over time. The Fund also enters into derivative transactions, which may be used for hedging or investment purposes (see “Portfolio of Investments” section of the report for additional details). “Other” securities type weightings represent 0.1% or less in the following security types: Emerging Markets – Sovereigns, Options Purchased – Calls and Options Purchased – Puts.

AB HIGH YIELD PORTFOLIO  • 9

Portfolio Summary

PORTFOLIO OF INVESTMENTS

October 31, 2015

		Principal Amount (000)		U.S. $ Value
CORPORATES – NON-INVESTMENT GRADE – 72.1%
Industrial – 59.3%
Basic – 3.2%
AK Steel Corp. 7.625%, 5/15/20-10/01/21	U.S.$		65	$	31,675
Aleris International, Inc. 7.625%, 2/15/18			13		12,155
7.875%, 11/01/20			9		8,460
ArcelorMittal 5.125%, 6/01/20			10		9,609
6.125%, 6/01/18-6/01/25			100		96,461
6.25%, 3/01/21			10		9,444
7.00%, 2/25/22			15		14,213
7.75%, 10/15/39			42		35,805
Ashland, Inc. 3.875%, 4/15/18			19		19,641
Chemours Co. (The) 7.00%, 5/15/25(a)			4		2,980
Cliffs Natural Resources, Inc. 7.75%, 3/31/20(a)			12		4,860
8.25%, 3/31/20(a)			17		15,215
Commercial Metals Co. 6.50%, 7/15/17			25		25,937
FMG Resources August 2006 Pty Ltd. 6.875%, 4/01/22(a)			25		17,875
9.75%, 3/01/22(a)			14		13,930
Huntsman International LLC 4.875%, 11/15/20			10		9,407
JMC Steel Group, Inc. 8.25%, 3/15/18(a)			10		6,800
Joseph T. Ryerson & Son, Inc. 9.00%, 10/15/17			18		15,705
Lundin Mining Corp. 7.875%, 11/01/22(a)			13		13,030
Magnetation LLC/Mag Finance Corp. 11.00%, 5/15/18(b)(c)			35		7,700
Momentive Performance Materials, Inc. 3.88%, 10/24/21			40		32,000
8.875%, 10/15/20(d)(e)(f)			40		– 0	–
Novelis, Inc. 8.375%, 12/15/17			10		10,075
8.75%, 12/15/20			30		30,075
Peabody Energy Corp. 6.00%, 11/15/18			62		10,850
10.00%, 3/15/22(a)			30		8,100
Smurfit Kappa Treasury Funding Ltd. 7.50%, 11/20/25			40		48,800

10 •  AB HIGH YIELD PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Steel Dynamics, Inc. 5.125%, 10/01/21	U.S.$		15	$	14,888
6.125%, 8/15/19			35		36,225
Teck Resources Ltd. 4.50%, 1/15/21			18		12,240
5.40%, 2/01/43			5		2,675
6.25%, 7/15/41			8		4,520
Thompson Creek Metals Co., Inc. 7.375%, 6/01/18			8		3,360
9.75%, 12/01/17			25		23,625
Univar USA, Inc. 6.75%, 7/15/23(a)			14		13,860
WR Grace & Co.-Conn 5.125%, 10/01/21(a)			12		12,480
					634,675
Capital Goods – 6.5%
Apex Tool Group LLC 7.00%, 2/01/21(a)			20		16,100
Ardagh Packaging Finance PLC/Ardagh Holdings USA, Inc. 6.00%, 6/30/21(a)			200		196,000
Berry Plastics Corp. 5.125%, 7/15/23			7		6,930
5.50%, 5/15/22			20		20,600
6.00%, 10/15/22(a)			4		4,180
Beverage Packaging Holdings Luxembourg II SA/Beverage Packaging Holdings II Issuer 6.00%, 6/15/17(a)			10		10,050
Bombardier, Inc. 6.00%, 10/15/22(a)			35		26,950
6.125%, 1/15/23(a)			74		57,350
7.50%, 3/15/25(a)			27		20,992
Building Materials Corp. of America 6.00%, 10/15/25(a)			19		20,235
Clean Harbors, Inc. 5.25%, 8/01/20			18		18,720
CNH Industrial Capital LLC 3.625%, 4/15/18			60		60,150
EnerSys 5.00%, 4/30/23(a)			10		10,150
EnPro Industries, Inc. 5.875%, 9/15/22			16		16,120
Gardner Denver, Inc. 6.875%, 8/15/21(a)			28		24,220
HD Supply, Inc. 7.50%, 7/15/20			39		41,535
11.50%, 7/15/20			15		16,969
KLX, Inc. 5.875%, 12/01/22(a)			40		40,825

AB HIGH YIELD PORTFOLIO  • 11

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Manitowoc Co., Inc. (The) 5.875%, 10/15/22	U.S.$		3	$	3,098
8.50%, 11/01/20			30		31,238
Masco Corp. 7.125%, 3/15/20			30		34,875
Owens-Brockway Glass Container, Inc. 5.875%, 8/15/23(a)			3		3,184
Owens-Illinois, Inc. 7.80%, 5/15/18			25		27,797
Pactiv LLC 7.95%, 12/15/25			31		29,992
Reynolds Group Issuer, Inc./Reynolds Group Issuer LLC/Reynolds Group Issuer Lu 8.25%, 2/15/21			100		103,875
9.00%, 4/15/19			100		102,250
Sealed Air Corp. 5.25%, 4/01/23(a)			13		13,585
6.875%, 7/15/33(a)			75		76,500
SPX FLOW, Inc. 6.875%, 9/01/17			75		79,500
Summit Materials LLC/Summit Materials Finance Corp. 10.50%, 1/31/20			8		8,480
TransDigm, Inc. 6.00%, 7/15/22			30		30,300
6.50%, 7/15/24			20		20,350
United Rentals North America, Inc. 5.50%, 7/15/25			64		63,840
5.75%, 11/15/24			39		39,585
					1,276,525
Communications - Media – 8.3%
CCO Holdings LLC/CCO Holdings Capital Corp. 5.125%, 2/15/23			60		60,150
5.375%, 5/01/25(a)			42		41,580
5.75%, 1/15/24			8		8,120
5.875%, 5/01/27(a)			44		44,000
Cequel Communications Holdings I LLC/Cequel Capital Corp. 5.125%, 12/15/21(a)			74		71,095
Clear Channel Worldwide Holdings, Inc. Series B 6.50%, 11/15/22			35		36,487
7.625%, 3/15/20			6		6,225
CSC Holdings LLC 5.25%, 6/01/24			140		123,129
7.625%, 7/15/18			24		25,470
8.625%, 2/15/19			35		37,187

12 •  AB HIGH YIELD PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
DISH DBS Corp. 5.125%, 5/01/20	U.S.$		30	$	29,888
5.875%, 11/15/24			60		57,390
6.75%, 6/01/21			105		108,412
Hughes Satellite Systems Corp. 7.625%, 6/15/21			50		54,500
iHeartCommunications, Inc. 6.875%, 6/15/18			70		60,200
9.00%, 12/15/19-9/15/22			60		50,200
Intelsat Jackson Holdings SA 5.50%, 8/01/23			95		78,316
Mediacom Broadband LLC/Mediacom Broadband Corp. 6.375%, 4/01/23			30		28,950
Nexstar Broadcasting, Inc. 6.875%, 11/15/20			17		17,574
Nielsen Co. Luxembourg SARL (The) 5.50%, 10/01/21(a)			29		30,051
Nielsen Finance LLC/Nielsen Finance Co. 5.00%, 4/15/22(a)			35		35,569
Outfront Media Capital LLC/Outfront Media Capital Corp. 5.625%, 2/15/24(a)			10		10,406
Radio One, Inc. 7.375%, 4/15/22(a)			20		18,700
9.25%, 2/15/20(a)			26		21,450
RR Donnelley & Sons Co. 7.25%, 5/15/18			30		32,138
8.25%, 3/15/19			20		22,400
Sinclair Television Group, Inc. 5.375%, 4/01/21			20		20,050
5.625%, 8/01/24(a)			50		49,000
6.125%, 10/01/22			26		26,715
Sirius XM Radio, Inc. 5.375%, 4/15/25(a)			18		18,428
6.00%, 7/15/24(a)			47		49,623
Starz LLC/Starz Finance Corp. 5.00%, 9/15/19			55		56,244
TEGNA, Inc. 4.875%, 9/15/21(a)			35		34,650
5.125%, 7/15/20			5		5,213
5.50%, 9/15/24(a)			7		7,105
6.375%, 10/15/23			7		7,560
Time, Inc. 5.75%, 4/15/22(a)			50		50,000
Townsquare Media, Inc. 6.50%, 4/01/23(a)			19		18,240
Univision Communications, Inc. 5.125%, 5/15/23-2/15/25(a)			98		96,697
6.75%, 9/15/22(a)			22		23,238

AB HIGH YIELD PORTFOLIO  • 13

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Videotron Ltd. 5.00%, 7/15/22	U.S.$		55	$	57,406
					1,629,756
Communications - Telecommunications – 6.9%
CenturyLink, Inc. Series T 5.80%, 3/15/22			10		9,725
Series U 7.65%, 3/15/42			55		47,025
Series W 6.75%, 12/01/23			27		26,795
CommScope Technologies Finance LLC 6.00%, 6/15/25(a)			23		23,345
CommScope, Inc. 5.50%, 6/15/24(a)			14		13,860
Communications Sales & Leasing, Inc./CSL Capital LLC 6.00%, 4/15/23(a)			40		38,800
8.25%, 10/15/23			31		28,659
Frontier Communications Corp. 6.25%, 9/15/21			34		30,362
7.125%, 3/15/19-1/15/23			43		40,822
7.625%, 4/15/24			35		31,325
7.875%, 1/15/27			10		8,500
8.125%, 10/01/18			15		15,825
9.00%, 8/15/31			10		9,045
10.50%, 9/15/22(a)			7		7,263
11.00%, 9/15/25(a)			79		82,801
Level 3 Financing, Inc. 5.375%, 1/15/24(a)			24		24,300
7.00%, 6/01/20			40		42,400
SBA Communications Corp. 5.625%, 10/01/19			20		20,900
Sprint Capital Corp. 6.875%, 11/15/28			5		4,150
8.75%, 3/15/32			45		40,500
Sprint Communications, Inc. 6.00%, 11/15/22			40		34,180
9.00%, 11/15/18(a)			85		93,446
Sprint Corp. 7.125%, 6/15/24			10		8,781
7.25%, 9/15/21			30		27,562
7.625%, 2/15/25			122		108,275
7.875%, 9/15/23			85		78,625
T-Mobile USA, Inc. 6.25%, 4/01/21			50		51,620
6.375%, 3/01/25			85		85,212
6.542%, 4/28/20			102		104,550

14 •  AB HIGH YIELD PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Telecom Italia Capital SA 6.375%, 11/15/33	U.S.$		110	$	106,344
7.20%, 7/18/36			8		8,240
WaveDivision Escrow LLC/WaveDivision Escrow Corp. 8.125%, 9/01/20(a)			10		9,725
Windstream Services LLC 6.375%, 8/01/23			21		16,643
7.50%, 4/01/23			30		25,050
Zayo Group LLC/Zayo Capital, Inc. 6.00%, 4/01/23(a)			42		42,819
6.375%, 5/15/25(a)			15		15,188
					1,362,662
Consumer Cyclical - Automotive – 1.3%
Affinia Group, Inc. 7.75%, 5/01/21			30		31,125
Banque PSA Finance SA 4.375%, 4/04/16(a)			30		30,320
Commercial Vehicle Group, Inc. 7.875%, 4/15/19			50		50,750
Dana Holding Corp. 5.375%, 9/15/21			29		29,580
Gates Global LLC/Gates Global Co. 6.00%, 7/15/22(a)			58		46,545
LKQ Corp. 4.75%, 5/15/23			55		54,038
Titan International, Inc. 6.875%, 10/01/20			20		16,900
					259,258
Consumer Cyclical - Entertainment – 0.4%
AMC Entertainment, Inc. 5.75%, 6/15/25			17		17,127
Regal Entertainment Group 5.75%, 3/15/22-6/15/23			35		35,650
Royal Caribbean Cruises Ltd. 7.25%, 3/15/18			15		16,425
					69,202
Consumer Cyclical - Other – 4.2%
Beazer Homes USA, Inc. 5.75%, 6/15/19			20		19,250
Boyd Gaming Corp. 9.00%, 7/01/20			50		53,875
Caesars Entertainment Operating Co., Inc. 9.00%, 2/15/20(b)			5		4,025
Caesars Entertainment Resort Properties LLC/Caesars Entertainment Resort Prope 8.00%, 10/01/20			20		19,850

AB HIGH YIELD PORTFOLIO  • 15

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Caesars Growth Properties Holdings LLC/Caesars Growth Properties Finance, Inc. 9.375%, 5/01/22	U.S.$		20	$	16,550
CalAtlantic Group, Inc. 6.625%, 5/01/20			20		22,150
8.375%, 5/15/18			15		17,250
DR Horton, Inc. 6.50%, 4/15/16			60		61,050
Eldorado Resorts, Inc. 7.00%, 8/01/23(a)			16		16,200
GLP Capital LP / GLP Financing II, Inc. 5.375%, 11/01/23			25		25,241
International Game Technology 7.50%, 6/15/19			80		85,800
Isle of Capri Casinos, Inc. 5.875%, 3/15/21			9		9,473
K. Hovnanian Enterprises, Inc. 5.00%, 11/01/21			28		19,600
KB Home 4.75%, 5/15/19			15		14,751
7.00%, 12/15/21			10		10,125
8.00%, 3/15/20			20		21,750
Lennar Corp. Series B 6.50%, 4/15/16			50		50,875
M/I Homes, Inc. 8.625%, 11/15/18			40		40,850
MDC Holdings, Inc. 5.50%, 1/15/24			8		8,160
6.00%, 1/15/43			7		8,910
Meritage Homes Corp. 6.00%, 6/01/25			63		64,575
7.00%, 4/01/22			4		4,380
NAI Entertainment Holdings/NAI Entertainment Holdings Finance Corp. 5.00%, 8/01/18(a)			25		25,812
PulteGroup, Inc. 6.00%, 2/15/35			30		29,775
6.375%, 5/15/33			10		10,310
7.875%, 6/15/32			4		4,630
Scientific Games International, Inc. 7.00%, 1/01/22(a)			18		18,090
Shea Homes LP/Shea Homes Funding Corp. 5.875%, 4/01/23(a)			4		4,185
6.125%, 4/01/25(a)			42		43,995
Taylor Morrison Communities, Inc./Monarch Communities, Inc. 5.625%, 3/01/24(a)			50		49,250
5.875%, 4/15/23(a)			14		14,140

16 •  AB HIGH YIELD PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Toll Brothers Finance Corp. 4.00%, 12/31/18	U.S.$		10	$	10,400
Wynn Las Vegas LLC/Wynn Las Vegas Capital Corp. 5.375%, 3/15/22			5		4,950
5.50%, 3/01/25(a)			13		12,201
					822,428
Consumer Cyclical - Restaurants – 0.2%
1011778 BC ULC/New Red Finance, Inc. 4.625%, 1/15/22(a)			16		16,240
6.00%, 4/01/22(a)			22		23,017
					39,257
Consumer Cyclical - Retailers – 3.2%
American Tire Distributors, Inc. 10.25%, 3/01/22(a)			50		50,500
Argos Merger Sub, Inc. 7.125%, 3/15/23(a)			65		68,412
Asbury Automotive Group, Inc. 6.00%, 12/15/24(a)			13		13,748
Cash America International, Inc. 5.75%, 5/15/18			67		67,502
CST Brands, Inc. 5.00%, 5/01/23			28		28,280
Dollar Tree, Inc. 5.75%, 3/01/23(a)			48		50,580
Group 1 Automotive, Inc. 5.00%, 6/01/22			30		30,300
L Brands, Inc. 6.875%, 11/01/35(a)			30		31,163
8.50%, 6/15/19			50		59,000
Levi Strauss & Co. 5.00%, 5/01/25			19		19,238
6.875%, 5/01/22			15		16,444
Neiman Marcus Group Ltd. LLC 8.75% (8.75% Cash or 9.50% PIK), 10/15/21(a)(g)			23		23,890
Party City Holdings, Inc. 6.125%, 8/15/23(a)			17		17,510
Rite Aid Corp. 6.125%, 4/01/23(a)			77		82,967
Serta Simmons Bedding LLC 8.125%, 10/01/20(a)			15		15,844
Sonic Automotive, Inc. 5.00%, 5/15/23			45		43,762
Wolverine World Wide, Inc. 6.125%, 10/15/20			10		10,500
					629,640

AB HIGH YIELD PORTFOLIO  • 17

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Consumer Non-Cyclical – 10.4%
Air Medical Merger Sub Corp. 6.375%, 5/15/23(a)	U.S.$		30	$	27,300
Alere, Inc. 6.375%, 7/01/23(a)			7		7,280
AMAG Pharmaceuticals, Inc. 7.875%, 9/01/23(a)			8		7,460
Amsurg Corp. 5.625%, 7/15/22			20		19,650
BI-LO LLC/BI-LO Finance Corp. 8.625% (8.625% Cash or 9.375% PIK), 9/15/18(a)(g)			39		35,685
9.25%, 2/15/19(a)			20		20,550
Capsugel SA 7.00% (7.00% Cash or 7.75% PIK), 5/15/19(a)(g)			36		36,270
CHS/Community Health Systems, Inc. 6.875%, 2/01/22			129		129,967
Concordia Healthcare Corp. 7.00%, 4/15/23(a)			2		1,740
9.50%, 10/21/22(a)			13		12,740
Constellation Brands, Inc. 4.25%, 5/01/23			20		20,475
7.25%, 5/15/17			40		43,300
DaVita HealthCare Partners, Inc. 5.00%, 5/01/25			48		47,650
Endo Finance LLC 5.75%, 1/15/22(a)			120		117,300
Envision Healthcare Corp. 5.125%, 7/01/22(a)			42		40,740
First Quality Finance Co., Inc. 4.625%, 5/15/21(a)			30		27,825
HCA, Inc. 4.25%, 10/15/19			153		157,582
5.375%, 2/01/25			49		50,286
6.50%, 2/15/20			80		89,500
Hill-Rom Holdings, Inc. 5.75%, 9/01/23(a)			6		6,120
HRG Group, Inc. 7.875%, 7/15/19(a)			13		13,780
7.875%, 7/15/19			48		50,940
Immucor, Inc. 11.125%, 8/15/19			20		20,500
Jaguar Holding Co. II/Pharmaceutical Product Development LLC 6.375%, 8/01/23(a)			13		13,016
Kindred Healthcare, Inc. 8.00%, 1/15/20(a)			55		57,062

18 •  AB HIGH YIELD PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Kinetic Concepts, Inc./KCI USA, Inc. 10.50%, 11/01/18	U.S.$		50	$	52,795
Mallinckrodt International Finance SA 3.50%, 4/15/18			11		10,656
Mallinckrodt International Finance SA/Mallinckrodt CB LLC 4.875%, 4/15/20(a)			10		9,588
5.50%, 4/15/25(a)			18		16,374
5.625%, 10/15/23(a)			23		21,706
5.75%, 8/01/22(a)			18		17,111
MPH Acquisition Holdings LLC 6.625%, 4/01/22(a)			10		10,200
Post Holdings, Inc. 7.375%, 2/15/22			60		63,216
7.75%, 3/15/24(a)			18		19,170
8.00%, 7/15/25(a)			29		31,465
PRA Holdings, Inc. 9.50%, 10/01/23(a)			30		33,825
Quintiles Transnational Corp. 4.875%, 5/15/23(a)			18		18,506
RSI Home Products, Inc. 6.50%, 3/15/23(a)			34		35,105
Smithfield Foods, Inc. 5.25%, 8/01/18(a)			25		25,375
5.875%, 8/01/21(a)			30		31,500
6.625%, 8/15/22			20		21,400
Spectrum Brands, Inc. 5.75%, 7/15/25(a)			15		15,994
6.125%, 12/15/24(a)			7		7,543
6.375%, 11/15/20			30		32,025
6.625%, 11/15/22			20		21,850
Sterigenics-Nordion Holdings LLC 6.50%, 5/15/23(a)			5		5,031
Sun Products Corp. (The) 7.75%, 3/15/21(a)			26		30,938
Tenet Healthcare Corp. 4.50%, 4/01/21			25		25,000
6.75%, 6/15/23			14		13,895
6.875%, 11/15/31			72		64,800
8.00%, 8/01/20			60		62,100
8.125%, 4/01/22			23		24,323
Valeant Pharmaceuticals International, Inc. 5.50%, 3/01/23(a)			30		25,200
5.875%, 5/15/23(a)			57		48,165
6.125%, 4/15/25(a)			202		170,690
6.75%, 8/15/18(a)			25		24,128
					2,044,392

AB HIGH YIELD PORTFOLIO  • 19

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Energy – 7.8%
American Energy-Permian Basin LLC/AEPB Finance Corp. 7.125%, 11/01/20(a)	U.S.$		10	$	5,375
Antero Resources Corp. 5.125%, 12/01/22			55		49,362
5.375%, 11/01/21			10		9,200
5.625%, 6/01/23(a)			10		9,200
Approach Resources, Inc. 7.00%, 6/15/21			10		5,600
Baytex Energy Corp. 5.625%, 6/01/24(a)			20		16,500
Berry Petroleum Co. LLC 6.375%, 9/15/22			34		12,240
Bonanza Creek Energy, Inc. 5.75%, 2/01/23			3		2,010
6.75%, 4/15/21			3		2,160
BreitBurn Energy Partners LP/BreitBurn Finance Corp. 7.875%, 4/15/22			19		7,125
California Resources Corp. 5.00%, 1/15/20			19		13,823
6.00%, 11/15/24			24		16,320
Carrizo Oil & Gas, Inc. 7.50%, 9/15/20			25		24,937
Chaparral Energy, Inc. 7.625%, 11/15/22			21		6,930
CHC Helicopter SA 9.25%, 10/15/20			41		23,085
Chesapeake Energy Corp. 2.50%, 5/15/37(h)			19		16,245
3.571%, 4/15/19(i)			15		9,675
4.875%, 4/15/22			20		12,400
6.875%, 11/15/20			35		23,712
7.25%, 12/15/18			6		4,830
Cobalt International Energy, Inc. 2.625%, 12/01/19(h)			24		17,280
Concho Resources, Inc. 5.50%, 4/01/23			30		30,150
Crestwood Midstream Partners LP/Crestwood Midstream Finance Corp. 6.25%, 4/01/23(a)			16		13,600
DCP Midstream Operating LP 3.875%, 3/15/23			13		11,009
5.60%, 4/01/44			16		12,420
Denbury Resources, Inc. 4.625%, 7/15/23			77		51,397
5.50%, 5/01/22			18		12,600

20 •  AB HIGH YIELD PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Diamondback Energy, Inc. 7.625%, 10/01/21	U.S.$		8	$	8,520
Energy Transfer Equity LP 5.875%, 1/15/24			41		39,720
7.50%, 10/15/20			16		17,203
Energy XXI Gulf Coast, Inc. 6.875%, 3/15/24			35		6,825
7.75%, 6/15/19			10		2,050
11.00%, 3/15/20(a)			13		6,825
EP Energy LLC/Everest Acquisition Finance, Inc. 7.75%, 9/01/22			20		15,400
9.375%, 5/01/20			7		6,090
EXCO Resources, Inc. 7.50%, 9/15/18			5		1,375
8.50%, 4/15/22			7		1,610
Global Partners LP/GLP Finance Corp. 6.25%, 7/15/22			50		46,000
7.00%, 6/15/23			7		6,580
Gulfport Energy Corp. 6.625%, 5/01/23			18		16,470
Halcon Resources Corp. 8.875%, 5/15/21			17		5,706
9.75%, 7/15/20			8		2,720
Hornbeck Offshore Services, Inc. 5.875%, 4/01/20			30		24,150
Jones Energy Holdings LLC/Jones Energy Finance Corp. 6.75%, 4/01/22			19		15,247
Jupiter Resources, Inc. 8.50%, 10/01/22(a)			24		12,480
Laredo Petroleum, Inc. 7.375%, 5/01/22			19		18,762
Legacy Reserves LP/Legacy Reserves Finance Corp. 6.625%, 12/01/21			30		19,800
8.00%, 12/01/20			10		7,100
Linn Energy LLC/Linn Energy Finance Corp. 6.25%, 11/01/19			52		12,220
MarkWest Energy Partners LP/MarkWest Energy Finance Corp. 4.875%, 12/01/24-6/01/25			65		60,950
Memorial Resource Development Corp. 5.875%, 7/01/22			20		18,850
Midstates Petroleum Co., Inc./Midstates Petroleum Co. LLC 9.25%, 6/01/21			20		3,600
Newfield Exploration Co. 5.375%, 1/01/26			20		19,000
5.625%, 7/01/24			16		15,840

AB HIGH YIELD PORTFOLIO  • 21

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Northern Blizzard Resources, Inc. 7.25%, 2/01/22(a)	U.S.$		38	$	31,160
Oasis Petroleum, Inc. 6.875%, 3/15/22			20		17,050
Offshore Group Investment Ltd. 7.50%, 11/01/19			30		8,813
Paragon Offshore PLC 7.25%, 8/15/24(a)			60		9,150
PHI, Inc. 5.25%, 3/15/19			45		39,825
Precision Drilling Corp. 6.50%, 12/15/21			20		17,400
QEP Resources, Inc. 5.375%, 10/01/22			60		54,000
Range Resources Corp. 4.875%, 5/15/25(a)			27		24,165
Sabine Oil & Gas Corp. 7.25%, 6/15/19(b)			20		2,800
Sabine Pass Liquefaction LLC 5.625%, 3/01/25(a)			92		88,205
5.75%, 5/15/24			100		96,500
SandRidge Energy, Inc. 7.50%, 2/15/23			15		3,488
Seven Generations Energy Ltd. 6.75%, 5/01/23(a)			7		6,370
8.25%, 5/15/20(a)			30		29,100
SM Energy Co. 5.00%, 1/15/24			20		17,950
5.625%, 6/01/25			25		22,750
Southern Star Central Corp. 5.125%, 7/15/22(a)			20		19,400
Swift Energy Co. 7.875%, 3/01/22			15		3,863
Targa Resources Partners LP/Targa Resources Partners Finance Corp. 4.25%, 11/15/23			55		48,125
6.75%, 3/15/24(a)			10		9,838
Tervita Corp. 8.00%, 11/15/18(a)			15		11,025
10.875%, 2/15/18(a)			20		10,000
Transocean, Inc. 6.80%, 3/15/38			45		28,575
Triangle USA Petroleum Corp. 6.75%, 7/15/22(a)			20		9,400
Vanguard Natural Resources LLC/VNR Finance Corp. 7.875%, 4/01/20			10		5,988
W&T Offshore, Inc. 8.50%, 6/15/19			15		6,750

22 •  AB HIGH YIELD PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Whiting Petroleum Corp. 1.25%, 4/01/20(a)(h)	U.S.$		17	$	14,971
5.75%, 3/15/21			17		15,789
6.25%, 4/01/23			36		33,480
WPX Energy, Inc. 6.00%, 1/15/22			15		13,200
8.25%, 8/01/23			10		9,400
					1,538,808
Other Industrial – 0.8%
General Cable Corp. 4.50%, 11/15/29(h)(j)			17		11,613
5.75%, 10/01/22			20		17,250
Laureate Education, Inc. 9.25%, 9/01/19(a)			55		43,725
Modular Space Corp. 10.25%, 1/31/19(a)			23		13,743
New Enterprise Stone & Lime Co., Inc. 11.00%, 9/01/18			30		25,500
13.00% (7.00% Cash and 6.00% PIK), 3/15/18(g)			22		22,949
Safway Group Holding LLC/Safway Finance Corp. 7.00%, 5/15/18(a)			17		17,467
					152,247
Services – 0.5%
ADT Corp. (The) 2.25%, 7/15/17			15		14,925
4.125%, 4/15/19			20		20,450
6.25%, 10/15/21			20		21,600
IHS, Inc. 5.00%, 11/01/22			30		30,300
Mobile Mini, Inc. 7.875%, 12/01/20			20		20,800
					108,075
Technology – 4.7%
Avaya, Inc. 7.00%, 4/01/19(a)			41		33,313
10.50%, 3/01/21(a)			30		11,625
Blackboard, Inc. 7.75%, 11/15/19(a)			10		8,600
BMC Software Finance, Inc. 8.125%, 7/15/21(a)			35		27,081
Brightstar Corp. 9.50%, 12/01/16(a)			60		60,312
CDW LLC/CDW Finance Corp. 5.00%, 9/01/23			13		13,488
5.50%, 12/01/24			49		51,327
Ceridian HCM Holding, Inc. 11.00%, 3/15/21(a)			15		13,200

AB HIGH YIELD PORTFOLIO  • 23

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
CommScope Holding Co., Inc. 6.625% (6.625% Cash or 7.375% PIK), 6/01/20(a)(g)	U.S.$		10	$	10,400
Dell, Inc. 5.875%, 6/15/19			35		36,220
6.50%, 4/15/38			36		30,510
Energizer Holdings, Inc. 5.50%, 6/15/25(a)			12		12,240
Ensemble S Merger Sub, Inc. 9.00%, 9/30/23(a)			14		14,035
First Data Corp. 7.00%, 12/01/23(a)			160		162,800
11.75%, 8/15/21			30		34,200
12.625%, 1/15/21			45		51,581
Infor Software Parent LLC/Infor Software Parent, Inc. 7.125% (7.125% Cash or 7.875% PIK), 5/01/21(a)(g)			20		17,312
Infor US, Inc. 5.75%, 8/15/20(a)			27		27,540
6.50%, 5/15/22(a)			50		47,375
Micron Technology, Inc. 5.50%, 2/01/25			71		67,627
MSCI, Inc. 5.25%, 11/15/24(a)			32		33,680
5.75%, 8/15/25(a)			8		8,436
Nokia Oyj 5.375%, 5/15/19			15		16,031
Open Text Corp. 5.625%, 1/15/23(a)			7		7,070
Sabre GLBL, Inc. 5.375%, 4/15/23(a)			9		9,135
Sanmina Corp. 4.375%, 6/01/19(a)			32		32,640
Sensata Technologies BV 4.875%, 10/15/23(a)			50		48,938
SunGard Data Systems, Inc. 7.625%, 11/15/20			40		41,704
					928,420
Transportation - Airlines – 0.2%
Air Canada 6.75%, 10/01/19(a)			15		15,900
8.75%, 4/01/20(a)			20		21,850
					37,750
Transportation - Services – 0.7%
Avis Budget Car Rental LLC/Avis Budget Finance, Inc. 5.25%, 3/15/25(a)			40		39,850

24 •  AB HIGH YIELD PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Con-way, Inc. 6.70%, 5/01/34	U.S.$		21	$	15,279
Hertz Corp. (The) 5.875%, 10/15/20			65		67,275
XPO Logistics, Inc. 6.50%, 6/15/22(a)			16		11,602
					134,006
					11,667,101
Financial Institutions – 9.7%
Banking – 4.9%
ABN AMRO Bank NV 4.31%, 3/10/16(k)	EUR		50		55,120
Ally Financial, Inc. 4.125%, 3/30/20	U.S.$		85		87,762
8.00%, 12/31/18-11/01/31			86		102,885
Bank of America Corp. Series AA 6.10%, 3/17/25(k)			9		9,081
Series X 6.25%, 9/05/24(k)			50		50,703
Series Z 6.50%, 10/23/24(k)			11		11,495
Bank of Ireland 10.00%, 7/30/16(a)	EUR		100		115,475
Barclays Bank PLC 6.86%, 6/15/32(a)(k)	U.S.$		30		34,350
BBVA International Preferred SAU 4.952%, 9/20/16(a)(k)	EUR		50		54,900
Citigroup, Inc. 5.95%, 1/30/23(k)	U.S.$		46		45,655
Credit Agricole SA 7.589%, 1/30/20(k)	GBP		50		83,632
HT1 Funding GmbH 6.352%, 6/30/17(k)	EUR		40		43,986
Lloyds Bank PLC 4.385%, 5/12/17(k)			50		56,632
Lloyds Banking Group PLC 6.657%, 5/21/37(a)(k)	U.S.$		35		39,200
RBS Capital Trust C 4.243%, 1/12/16(k)	EUR		35		38,285
Royal Bank of Scotland Group PLC Series U 7.64%, 9/30/17(k)	U.S.$		100		104,450
Zions Bancorporation 5.65%, 11/15/23			10		10,363
5.80%, 6/15/23(k)			20		19,800
					963,774

AB HIGH YIELD PORTFOLIO  • 25

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Brokerage – 0.1%
E*TRADE Financial Corp. 5.375%, 11/15/22	U.S.$		15	$	16,038
Finance – 3.6%
Artsonig Pty Ltd. 11.50% (11.50% Cash or 12.00% PIK), 4/01/19(a)(g)			24		1,789
CIT Group, Inc. 3.875%, 2/19/19			20		20,300
5.25%, 3/15/18			95		99,631
5.50%, 2/15/19(a)			30		31,837
Creditcorp 12.00%, 7/15/18(a)			20		14,700
Enova International, Inc. 9.75%, 6/01/21			40		33,900
International Lease Finance Corp. 5.875%, 4/01/19			70		75,105
8.25%, 12/15/20			90		107,550
8.75%, 3/15/17			20		21,575
8.875%, 9/01/17			40		44,400
Navient Corp. 4.625%, 9/25/17			20		20,224
4.875%, 6/17/19			50		48,375
5.00%, 10/26/20			30		28,088
7.25%, 1/25/22			35		34,475
8.00%, 3/25/20			80		84,800
TMX Finance LLC/TitleMax Finance Corp. 8.50%, 9/15/18(a)			60		47,100
					713,849
Insurance – 0.8%
American Equity Investment Life Holding Co. 6.625%, 7/15/21			30		31,800
Genworth Holdings, Inc. 4.80%, 2/15/24			30		21,900
HUB International Ltd. 7.875%, 10/01/21(a)			30		29,925
Liberty Mutual Group, Inc. 7.80%, 3/15/37(a)			40		46,900
Wayne Merger Sub LLC 8.25%, 8/01/23(a)			20		27,825
					158,350
Other Finance – 0.2%
ACE Cash Express, Inc. 11.00%, 2/01/19(a)			10		3,300
CNG Holdings, Inc. 9.375%, 5/15/20(a)			13		6,581

26 •  AB HIGH YIELD PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
iPayment, Inc. 9.50%, 12/15/19(a)	U.S.$		6	$	6,331
Series AI 9.50%, 12/15/19			9		9,563
Speedy Group Holdings Corp. 12.00%, 11/15/17(a)			30		21,600
					47,375
REITS – 0.1%
FelCor Lodging LP 6.00%, 6/01/25			15		15,525
					1,914,911
Utility – 3.1%
Electric – 3.1%
AES Corp./VA 4.875%, 5/15/23			20		18,550
7.375%, 7/01/21			74		78,810
Calpine Corp. 5.50%, 2/01/24			15		14,250
5.75%, 1/15/25			60		56,850
7.875%, 1/15/23(a)			41		44,024
DPL, Inc. 6.75%, 10/01/19			20		20,500
Dynegy, Inc. 5.875%, 6/01/23			26		24,310
6.75%, 11/01/19			45		44,887
7.375%, 11/01/22			35		35,087
FirstEnergy Corp. Series A 2.75%, 3/15/18			20		20,042
Series B 4.25%, 3/15/23			29		29,312
Series C 7.375%, 11/15/31			20		23,867
GenOn Energy, Inc. 7.875%, 6/15/17			29		26,898
NRG Energy, Inc. 6.25%, 7/15/22			6		5,520
7.625%, 1/15/18			25		26,188
7.875%, 5/15/21			40		39,800
Series WI 6.25%, 5/01/24			44		39,380
Talen Energy Supply LLC 4.60%, 12/15/21			37		31,756
6.50%, 5/01/18			10		10,175
TerraForm Power Operating LLC 6.125%, 6/15/25(a)			20		18,000
					608,206
Total Corporates – Non-Investment Grade (cost $15,167,958)					14,190,218

AB HIGH YIELD PORTFOLIO  • 27

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
CORPORATES – INVESTMENT GRADE – 5.1%
Financial Institutions – 3.7%
Banking – 1.7%
HSBC Capital Funding LP/Jersey 10.176%, 6/30/30(a)(k)	U.S.$		35	$	52,850
JPMorgan Chase & Co. Series Q 5.15%, 5/01/23(k)			35		33,687
Series R 6.00%, 8/01/23(k)			20		20,290
Series S 6.75%, 2/01/24(k)			7		7,543
Nationwide Building Society 6.00%, 12/15/16(k)	GBP		40		62,281
Standard Chartered PLC 6.409%, 1/30/17(a)(k)	U.S.$		100		101,000
Wells Fargo & Co. Series S 5.90%, 6/15/24(k)			55		56,237
					333,888
Brokerage – 0.1%
GFI Group, Inc. 8.625%, 7/19/18			19		20,615
Insurance – 1.1%
MetLife, Inc. Series C 5.25%, 6/15/20(k)			49		49,459
Mitsui Sumitomo Insurance Co., Ltd. 7.00%, 3/15/72(a)			50		58,107
Nationwide Mutual Insurance Co. 9.375%, 8/15/39(a)			20		30,235
Progressive Corp. (The) 6.70%, 6/15/37			25		25,125
Prudential Financial, Inc. 5.625%, 6/15/43			40		41,860
XLIT Ltd. 5.50%, 3/31/45			12		11,511
					216,297
REITS – 0.8%
DDR Corp. 7.875%, 9/01/20			40		48,486
EPR Properties 7.75%, 7/15/20			55		64,603
Senior Housing Properties Trust 6.75%, 12/15/21			30		33,270
					146,359
					717,159

28 •  AB HIGH YIELD PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Industrial – 1.3%
Basic – 0.1%
Freeport-McMoRan, Inc. 2.375%, 3/15/18	U.S.$		25	$	22,875
5.45%, 3/15/43			3		2,141
Glencore Funding LLC 2.125%, 4/16/18			3		2,618
					27,634
Communications - Media – 0.2%
CCO Safari II LLC 4.908%, 7/23/25(a)			20		20,329
6.484%, 10/23/45(a)			25		25,925
					46,254
Communications - Telecommunications – 0.2%
Embarq Corp. 7.995%, 6/01/36			30		31,556
Qwest Corp. 6.75%, 12/01/21			15		16,118
					47,674
Consumer Non-Cyclical – 0.1%
Forest Laboratories LLC 5.00%, 12/15/21(a)			10		10,808
Energy – 0.7%
Cimarex Energy Co. 4.375%, 6/01/24			5		4,973
Enterprise Products Operating LLC Series A 8.375%, 8/01/66			14		13,755
Kinder Morgan Finance Co. LLC 5.70%, 1/05/16			29		29,216
Kinder Morgan, Inc./DE Series G 7.80%, 8/01/31			10		10,132
Noble Energy, Inc. 5.875%, 6/01/24			30		30,124
Regency Energy Partners LP/Regency Energy Finance Corp. 4.50%, 11/01/23			5		4,589
5.00%, 10/01/22			27		26,240
5.50%, 4/15/23			12		11,638
					130,667
					263,037

AB HIGH YIELD PORTFOLIO  • 29

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Utility – 0.1%
Electric – 0.1%
PPL Capital Funding, Inc. Series A 6.70%, 3/30/67	U.S.$		20	$	16,900
Total Corporates – Investment Grade (cost $1,021,741)					997,096
GOVERNMENTS – TREASURIES – 3.1%
Brazil – 0.1%
Brazil Notas do Tesouro Nacional Series B 6.00%, 8/15/50	BRL		30		18,099
United States – 3.0%
U.S. Treasury Notes 1.875%, 8/31/22	U.S.$		600		599,813
Total Governments – Treasuries (cost $625,541)					617,912
BANK LOANS – 2.0%
Industrial – 1.2%
Basic – 0.4%
FMG Resources (August 2006) Pty LTD (FMG America Finance, Inc.) 3.75%, 6/30/19(i)			20		16,836
Ineos US Finance LLC 4.25%, 3/31/22(i)			25		24,489
Magnetation LLC 12.00%, 3/07/16(d)(g)(l)			38		33,544
					74,869
Consumer Cyclical - Entertainment – 0.0%
NCL Corporation Ltd. (aka Norwegian Cruise Lines) 4.00%, 11/19/21(i)			4		3,850
Consumer Cyclical - Retailers – 0.1%
J. Crew Group, Inc. 4.00%, 3/05/21(i)			16		11,641
Men’s Wearhouse, Inc., (The) 5.00%, 6/18/21			7		7,264
					18,905
Consumer Non-Cyclical – 0.4%
Air Medical Group Holdings, Inc. 4.50%, 4/28/22(i)			13		13,056
Concordia Healthcare Corp. 10/21/21(m)			14		13,428

30 •  AB HIGH YIELD PORTFOLIO

Portfolio of Investments

Company		Principal Amount (000)		U.S. $ Value
Grifols Worldwide Operations Limited 3.188%, 2/27/21(i)	U.S.$		10	$	9,852
Ortho-Clinical Diagnostics Holdings Luxembourg S.A.r.l. 4.75%, 6/30/21(i)			9		9,279
Pharmedium Healthcare Corporation 7.75%, 1/28/22(i)			40		40,083
					85,698
Other Industrial – 0.2%
Atkore International, Inc. 7.75%, 10/09/21(i)			25		21,812
Travelport Finance (Luxembourg) S.A.r.l. 5.75%, 9/02/21(i)			23		23,052
					44,864
Technology – 0.1%
BMC Software Finance Inc. 5.00%, 9/10/20(i)			20		17,934
					246,120
Utility – 0.8%
Electric – 0.8%
Energy Future Intermediate Holding Company LLC (EFIH Finance Inc.) 4.25%, 6/19/16(i)			150		149,907
Total Bank Loans (cost $405,944)					396,027
		Shares
COMMON STOCKS – 1.8%
Clear Channel Outdoor Holdings, Inc. – Class A(f)			2,000		14,960
Crown Castle International Corp.			480		41,021
DISH Network Corp. – Class A(f)			150		9,445
Dynegy, Inc.(f)			768		14,922
eDreams ODIGEO SA(f)			5,140		13,735
Eldorado Resorts, Inc.(f)			1,332		13,187
EMC Corp./MA			710		18,616
Emeco Holdings Ltd.(f)			55,000		2,146
EP Energy Corp. – Class A(f)			1,456		8,022
General Motors Co.			760		26,532
Hovnanian Enterprises, Inc. – Class A(f)			1,894		3,902
International Game Technology PLC			1,000		16,220
iPayment, Inc.(f)			579		2,982
Las Vegas Sands Corp.			450		22,279
LifePoint Health, Inc.(f)			260		17,909
LyondellBasell Industries NV – Class A			110		10,220
MDC Holdings, Inc.			637		16,556
Navistar International Corp.(f)			1,533		18,856
Nortek, Inc.(f)			280		17,178

AB HIGH YIELD PORTFOLIO  • 31

Portfolio of Investments

Company	Shares		U.S. $ Value
SBA Communications Corp. – Class A(f)		290	$	34,516
Townsquare Media, Inc. – Class A(f)		1,300		14,248
Travelport Worldwide Ltd.		1,430		19,376
Whiting Petroleum Corp.(f)		299		5,152
Total Common Stocks (cost $398,267)				361,980
PREFERRED STOCKS – 1.4%
Financial Institutions – 1.3%
Banking – 1.1%
GMAC Capital Trust I 8.125%		2,375		61,346
Goldman Sachs Group, Inc. (The) Series J 5.50%		1,550		38,580
Morgan Stanley 6.875%		2,000		54,100
US Bancorp Series F 6.50%		2,000		57,960
				211,986
REITS – 0.2%
Public Storage Series W 5.20%		1,000		24,710
Welltower, Inc. 6.50%		500		13,275
				37,985
				249,971
Industrial – 0.1%
Consumer Cyclical - Other – 0.0%
Hovnanian Enterprises, Inc. 7.625%		325		2,128
Energy – 0.1%
Energy XXI Ltd. 5.625%		250		6,000
Halcon Resources Corp. 5.75%		35		5,810
Sanchez Energy Corp. 4.875%		550		7,863
SandRidge Energy, Inc. 8.50%		200		1,510
				21,183
				23,311
Total Preferred Stocks (cost $301,283)				273,282

32 •  AB HIGH YIELD PORTFOLIO

Portfolio of Investments

Company		Principal Amount (000)		U.S. $ Value
COMMERCIAL MORTGAGE-BACKED SECURITIES – 1.2%
Non-Agency Fixed Rate CMBS – 1.2%
Citigroup Commercial Mortgage Trust Series 2014-GC23, Class D 4.507%, 7/10/47(a)	U.S.$		50	$	44,064
GS Mortgage Securities Trust Series 2014-GC18, Class D 4.948%, 1/10/47(a)			100		90,204
JPMBB Commercial Mortgage Securities Trust Series 2013-C17, Class D 4.887%, 1/15/47(a)			100		91,596
Total Commercial Mortgage-Backed Securities (cost $243,425)					225,864
COLLATERALIZED MORTGAGE OBLIGATIONS – 0.9%
GSE Risk Share Floating Rate – 0.8%
Federal Home Loan Mortgage Corp. Structured Agency Credit Risk Debt Notes Series 2013-DN1, Class M2 7.347%, 7/25/23(i)			50		57,679
Series 2013-DN2, Class M2 4.447%, 11/25/23(i)			50		49,871
Federal National Mortgage Association Connecticut Avenue Securities Series 2013-C01, Class M2 5.447%, 10/25/23(i)			50		52,271
					159,821
Non-Agency Fixed Rate – 0.1%
Alternative Loan Trust Series 2006-28CB, Class A14 6.25%, 10/25/36			30		25,207
Total Collateralized Mortgage Obligations (cost $199,422)					185,028
		Shares
INVESTMENT COMPANIES – 0.3%
Funds and Investment Trusts – 0.3%
iShares Russell 2000 ETF (cost $49,298)			434		50,058

AB HIGH YIELD PORTFOLIO  • 33

Portfolio of Investments

Company		Principal Amount (000)		U.S. $ Value
GOVERNMENTS – SOVEREIGN AGENCIES – 0.2%
Brazil – 0.2%
Petrobras Global Finance BV 5.625%, 5/20/43	U.S.$		45	$	29,511
Colombia – 0.0%
Ecopetrol SA 5.875%, 5/28/45			10		8,150
Total Governments – Sovereign Agencies (cost $43,725)					37,661
AGENCIES – 0.1%
United States – 0.1%
CITGO Petroleum Corp. 6.25%, 8/15/22(a) (cost $29,061)			29		28,420
		Shares
WARRANTS – 0.1%
iPayment Holdings, Inc., expiring 12/29/22(d)(f)(l) (cost $4,220)			11,721		11,721
		Principal Amount (000)
EMERGING MARKETS – SOVEREIGNS – 0.1%
Venezuela – 0.1%
Venezuela Government International Bond 9.25%, 9/15/27 (cost $17,777)	U.S.$		20		8,750
		Contracts
OPTIONS PURCHASED – CALLS – 0.0%
Options on Indices – 0.0%
EURO STOXX 50 Volatility Index Expiration: Nov 2015, Exercise Price: EUR 3,500.00(f)(n)			123		2,535
iShares iBoxx High Yield Expiration: Dec 2015, Exercise Price: $ 89.00(f)(o)			102		204
					2,739
Options on Funds and Investment Trusts – 0.0%
SPDR S&P 500 ETF Trust Expiration: Nov 2015, Exercise Price: $ 210.00(f)(o)			11		1,721
SPDR S&P 500 ETF Trust Expiration: Dec 2015, Exercise Price: $ 227.00(f)(o)			36		180
					1,901

34 •  AB HIGH YIELD PORTFOLIO

Portfolio of Investments

Company		Contracts		U.S. $ Value
Options on Equities – 0.0%
Diageo PLC Expiration: Dec 2015, Exercise Price: GBP 20.00(f)(n)			3,344	$	824
Beazer Homes USA Expiration: Nov 2015, Exercise Price: $ 22.00(f)(o)			9		23
					847
Total Options Purchased – Calls (premiums paid $9,940)					5,487
OPTIONS PURCHASED – PUTS – 0.0%
Options on Funds and Investment Trusts – 0.0%
Boardwalk Real Estate Investment Trust Expiration: Nov 2015, Exercise Price: CAD 52.00(f)(n)			1,630		472
SPDR S&P 500 ETF Trust Expiration: Nov 2015, Exercise Price: $ 200.00(f)(o)			13		1,014
SPDR S&P 500 ETF Trust Expiration: Nov 2015, Exercise Price: $ 187.00(f)(o)			20		300
SPDR S&P 500 ETF Trust Expiration: Nov 2015, Exercise Price: $ 194.00(f)(o)			21		725
					2,511
		Notional Amount (000)
Swaptions – 0.0%
CDX-NAHY Series 25, 5 Year Index RTP, Barclays Bank PLC NA (Buy Protection) Expiration: Nov 2015, Exercise Rate: 101.00%(f)	U.S.$		660,000		1,277
Total Options Purchased – Puts (premiums paid $11,032)					3,788
		Shares
SHORT-TERM INVESTMENTS – 10.6%
Investment Companies – 10.1%
AB Fixed-Income Shares, Inc. – Government STIF Portfolio, 0.13%(p)(q) (cost $1,992,398)			1,992,398		1,992,398

AB HIGH YIELD PORTFOLIO  • 35

Portfolio of Investments

		Principal Amount (000)			U.S. $ Value
TIME DEPOSITS – 0.5%
BBH, Grand Cayman
(0.237)%, 11/02/15	EUR		– 0	–^	$	5
0.03%, 11/02/15	U.S.$		5			5,341
0.05%, 11/02/15	CAD		– 0	–^		1
0.854%, 11/02/15	AUD		– 0	–^		– 0	–†
5.25%, 11/02/15	ZAR		2			113
BTMU, Grand Cayman 0.005%, 11/02/15	JPY		5,359			44,410
DNB, Oslo 0.08%, 11/02/15	GBP		29			43,948
Total Time Deposits (cost $93,175)						93,818
Total Short-Term Investments (cost $2,085,573)						2,086,216
Total Investments – 99.0% (cost $20,614,207)						19,479,508
Other assets less liabilities – 1.0%						203,864
Net Assets – 100.0%					$	19,683,372

FUTURES (see Note D)

Type	Number of Contracts		Expiration Month		Original Value		Value at October 31, 2015		Unrealized Appreciation/ (Depreciation)
Purchased Contracts
U.S. T-Note 10 Yr Futures (CBT)		3		December 2015	$	384,930	$	383,063	$	(1,867	)
Sold Contracts
S&P 500 E-Mini Futures		2		December 2015		200,287		207,370		(7,083	)
									$	(8,950	)

FORWARD CURRENCY EXCHANGE CONTRACTS (see Note D)

Counterparty	Contracts to Deliver (000)			In Exchange For (000)			Settlement Date		Unrealized Appreciation/ (Depreciation)
Brown Brothers Harriman & Co.		USD	41		SEK	341		11/05/15	$	(1,392	)
Brown Brothers Harriman & Co.		USD	44		GBP	29		11/10/15		(91	)
Brown Brothers Harriman & Co.		NZD	81		USD	54		11/20/15		(1,214	)
Brown Brothers Harriman & Co.		USD	24		MXN	402		11/20/15		771
Brown Brothers Harriman & Co.		EUR	444		USD	490		12/03/15		1,697
Brown Brothers Harriman & Co.		USD	44		JPY	5,359		12/11/15		9
Brown Brothers Harriman & Co.		AUD	40		USD	28		12/18/15		7
Deutsche Bank AG		BRL	93		USD	23		11/04/15		(911	)
Deutsche Bank AG		USD	24		BRL	93		11/04/15		7

36 •  AB HIGH YIELD PORTFOLIO

Portfolio of Investments

Counterparty	Contracts to Deliver (000)			In Exchange For (000)			Settlement Date		Unrealized Appreciation/ (Depreciation)
Goldman Sachs Bank USA		USD	27		BRL	108		12/02/15	$	473
Royal Bank of Scotland PLC		GBP	185		USD	284		11/10/15		(1,201	)
Royal Bank of Scotland PLC		USD	44		PEN	142		11/17/15		(586	)
Standard Chartered Bank		BRL	92		USD	24		11/04/15		(7	)
Standard Chartered Bank		USD	24		BRL	92		11/04/15		410
Standard Chartered Bank		KRW	50,312		USD	42		11/13/15		(1,773	)
Standard Chartered Bank		BRL	77		USD	20		12/02/15		(226	)
									$	(4,027	)

PUT OPTIONS WRITTEN (see Note D)

Description	Contracts		Exercise Price		Expiration Month		Premiums Received		U.S. $ Value
iShares IBoxx High Yield(o)		102	$	76.00		December 2015	$	3,973	$	(1,326	)
SPDR S&P 500 ETF Trust(o)		20		177.00		November 2015		1,339		(120	)
SPDR S&P 500 ETF Trust(o)		21		184.00		November 2015		944		(231	)
SPDR S&P 500 ETF Trust(o)		13		190.00		November 2015		402		(279	)
Taylor Morrison Home Corp.(o)		8		22.50		January 2016		2,145		(3,400	)
							$	8,803	$	(5,356	)

CREDIT DEFAULT SWAPTIONS WRITTEN (see Note D)

Description	Counterparty		Buy/Sell Protection		Strike Rate			Expiration Date		Notional Amount (000)		Premiums Received		Market Value
Put – CDX-NAHY Series 25, 5 Year Index		Barclays Bank PLC		Sell		98.00	%		11/18/15	$	660	$	594	$	(276	)

CENTRALLY CLEARED CREDIT DEFAULT SWAPS (see Note D)

Clearing Broker/(Exchange) & Referenced Obligation	Fixed Rate (Pay) Receive			Implied Credit Spread at October 31, 2015			Notional Amount (000)		Market Value			Unrealized Appreciation/ (Depreciation)
Buy Contracts
Citigroup Global Markets, Inc./(INTRCONX):
iTraxx Europe Crossover Series 23, 5 Year Index, 6/20/20*		(5.00	)%		3.13	%	EUR	160	$	(14,661	)	$	2,127
Sale Contracts
Citigroup Global Markets, Inc./(INTRCONX):
CDX-NAHY Series 24, 5 Year Index, 6/20/20*		5.00			3.59		$	344		21,734			5,917
CDX-NAHY Series 24, 5 Year Index, 6/20/20*		5.00			3.59			143		9,019			2,441
CDX-NAHY Series 25, 5 Year Index, 12/20/20*		5.00			4.27			162		6,019			6,322

AB HIGH YIELD PORTFOLIO  • 37

Portfolio of Investments

Clearing Broker/(Exchange) & Referenced Obligation	Fixed Rate (Pay) Receive			Implied Credit Spread at October 31, 2015			Notional Amount (000)		Market Value		Unrealized Appreciation/ (Depreciation)
CDX-NAHY Series 25, 5 Year Index, 12/20/20*		5.00	%		4.27	%	$	162	$	6,019	$	5,924
CDX-NAHY Series 25, 5 Year Index, 12/20/20*		5.00			4.27			162		6,019		5,876
CDX-NAHY Series 25, 5 Year Index, 12/20/20*		5.00			4.27			162		6,019		5,701
CDX-NAHY Series 25, 5 Year Index, 12/20/20*		5.00			4.27			112		4,162		4,635
CDX-NAHY Series 25, 5 Year Index, 12/20/20*		5.00			4.27			112		4,162		4,437
CDX-NAHY Series 25, 5 Year Index, 12/20/20*		5.00			4.27			112		4,162		4,327
CDX-NAHY Series 25, 5 Year Index, 12/20/20*		5.00			4.27			112		4,162		1,228
									$	56,816	$	48,935

* Termination date

CREDIT DEFAULT SWAPS (see Note D)

Swap Counterparty & Referenced Obligation	Fixed Rate (Pay) Receive			Implied Credit Spread at October 31, 2015			Notional Amount (000)		Market Value			Upfront Premiums Paid (Received)			Unrealized Appreciation/ (Depreciation)
Buy Contracts
Credit Suisse International:
Western Union Co., 3.650% 8/22/18, 9/20/17*		(1.00	)%		0.32	%	$	60	$	(812	)	$	(503	)	$	(309	)
Goldman Sachs International:
British Telecommunications PLC, 5.750% 12/07/28, 6/20/20*		(1.00	)		0.71			EUR     170		(2,642	)		(4,259	)		1,617
Sale Contracts
Bank of America, NA:
Abengoa S.A., 8.500% 3/31/16, 12/20/20*		5.00			49.43			15		(11,329	)		(11,327	)		(2	)
Barclays Bank PLC:
Altice Finco S.A., 9.000% 6/15/23, 12/20/20*		5.00			4.12			40		2,022			1,839			183
Unitymedia GmbH, 6.125% 1/15/25, 12/20/20*		5.00			1.96			70		11,924			11,818			106

38 •  AB HIGH YIELD PORTFOLIO

Portfolio of Investments

Swap Counterparty & Referenced Obligation	Fixed Rate (Pay) Receive			Implied Credit Spread at October 31, 2015			Notional Amount (000)		Market Value			Upfront Premiums Paid (Received)			Unrealized Appreciation/ (Depreciation)
Citibank, NA:
Advanced Micro Devices, Inc., 7.750% 8/01/20, 9/20/20*		5.00	%		11.19	%	$	20	$	(4,107	)	$	(4,767	)	$	660
Credit Suisse International:
Altice Finco S.A., 9.000% 6/15/23, 12/20/20*		5.00			4.12		EUR	100		5,212			4,566			646
Numericable-Sfr Sas, 5.375% 5/15/22, 12/20/20*		5.00			3.30			80		7,699			7,167			532
Western Union Co., 3.650% 8/22/18, 9/20/19*		1.00			0.89		$	40		157			(433	)		590
Goldman Sachs International:
Convatec Healthcare E S.A., 10.875% 12/15/18, 9/20/19*		5.00			1.18		EUR	25		4,154			3,873			281
K. Hovnanian Enterprises, Inc., 8.625%, 1/15/17, 9/20/20*		5.00			12.23		$	10		(2,458	)		(2,622	)		164
Wind Acquisition Finance S.A., 7.000% 4/23/21, 9/20/20*		5.00			3.05		EUR	30		3,066			3,331			(265	)
JPMorgan Chase Bank, NA:
Virgin Media Finance PLC, 7.000% 4/15/23, 9/20/19*		5.00			1.87			60		8,093			5,825			2,268
Wind Acquisition Finance S.A., 11.750% 7/15/17, 9/20/19*		5.00			2.47			70		7,580			4,904			2,676
Morgan Stanley & Co. International PLC:
AK Steel Corp., 7.625% 5/15/20, 9/20/19*		5.00			22.73		$	30		(11,960	)		282			(12,242	)
MGM Resorts International, 7.625% 1/15/17, 9/20/19*		5.00			1.84			70		8,493			5,871			2,622
U.S. Steel Corp., 6.650% 6/01/37, 9/20/19*		5.00			13.96			20		(4,729	)		883			(5,612	)
									$	20,363		$	26,448		$	(6,085	)

* Termination date

AB HIGH YIELD PORTFOLIO  • 39

Portfolio of Investments

TOTAL RETURN SWAPS (see Note D)

Counterparty & Referenced Obligation	# of Shares or Units		Rate Paid/ Received		Notional Amount (000)		Maturity Date		Unrealized Appreciation/ (Depreciation)
Receive Total Return on Reference Obligation
Bank of America, NA
Markit iBoxx USD Liquid High Yield Index		7,246		LIBOR	$	1,670		12/28/15	$	6,997
Goldman Sachs International
Markit iBoxx USD Liquid High Yield Index		415		LIBOR		94		12/28/15		2,121
Markit iBoxx USD Liquid High Yield Index		782		LIBOR		179		12/28/15		2,035
Markit iBoxx USD Liquid High Yield Index		392		LIBOR		90		12/28/15		651
JPMorgan Chase Bank, NA
Markit iBoxx USD Liquid High Yield Index		1,011		LIBOR		231		12/28/15		2,953
Morgan Stanley & Co. International PLC
Markit iBoxx USD Liquid High Yield Index		796		LIBOR		182		12/28/15		2,241
Markit iBoxx USD Liquid High Yield Index		797		LIBOR		183		12/28/15		1,405
Markit iBoxx USD Liquid High Yield Index		4		LIBOR		1		12/28/15		11
Pay Total Return on Reference Obligation
Morgan Stanley & Co. International PLC
Markit iBoxx USD Liquid High Yield Index		866		LIBOR		200		12/21/15		(494	)
									$	17,920

^ Principal amount less than 500.

† Less than $0.50.

(a) Security is exempt from registration under Rule 144A of the Securities Act of 1933. These securities are considered liquid and may be resold in transactions exempt from registration, normally to qualified institutional buyers. At October 31, 2015, the aggregate market value of these securities amounted to $5,451,929 or 27.7% of net assets.

(b) Security is in default and is non-income producing.

(c) Security is exempt from registration under Rule 144A of the Securities Act of 1933. These securities, which represent 0.04% of net assets as of October 31, 2015, are considered illiquid and restricted.

Restricted Securities	Acquisition Date		Cost		Market Value		Percentage of Net Assets
Magnetation LLC/Mag Finance Corp. 11.00%, 5/15/18		7/17/14	$	36,771	$	7,700		0.04	%

(d) Fair valued by the Adviser.

(e) Restricted and illiquid security.

Restricted Securities	Acquisition Date		Cost			Market Value			Percentage of Net Assets
Momentive Performance Materials, Inc. 8.875%, 10/15/20		7/16/14	$	– 0	–	$	– 0	–		0.00	%

40 •  AB HIGH YIELD PORTFOLIO

Portfolio of Investments

(f) Non-income producing security.

(g) Pay-In-Kind Payments (PIK). The issuer may pay cash interest and/or interest in additional debt securities. Rates shown are the rates in effect at October 31, 2015.

(h) Convertible security.

(i) Floating Rate Security. Stated interest rate was in effect at October 31, 2015.

(j) Coupon rate adjusts periodically based upon a predetermined schedule. Stated interest rate in effect at October 31, 2015.

(k) Securities are perpetual and, thus, do not have a predetermined maturity date. The date shown, if applicable, reflects the next call date.

(l) Illiquid security.

(m) This position or a portion of this position represents an unsettled loan purchase. The coupon rate will be determined at the time of settlement and will be based upon the London-Interbank Offered Rate (“LIBOR”) plus a premium which was determined at the time of purchase.

(n) One contract relates to 1 share.

(o) One contract relates to 100 shares.

(p) Investment in affiliated money market mutual fund. The rate shown represents the 7-day yield as of period end.

(q) To obtain a copy of the fund’s financial statements, please go to the Securities and Exchange Commission’s website at www.sec.gov, or call AB at (800) 227-4618.

Currency Abbreviations:

AUD – Australian Dollar

BRL – Brazilian Real

CAD – Canadian Dollar

EUR – Euro

GBP – Great British Pound

JPY – Japanese Yen

KRW – South Korean Won

MXN – Mexican Peso

NZD – New Zealand Dollar

PEN – Peruvian Nuevo Sol

SEK – Swedish Krona

USD – United States Dollar

ZAR – South African Rand

Glossary:

CBT – Chicago Board of Trade

CDX-NAHY – North American High Yield Credit Default Swap Index

CMBS – Commercial Mortgage-Backed Securities

ETF – Exchange Traded Fund

GSE – Government-Sponsored Enterprise

INTRCONX – Inter-Continental Exchange

LIBOR – London Interbank Offered Rates

REIT – Real Estate Investment Trust

RTP – Right to Pay

SPDR – Standard & Poor’s Depository Receipt

See notes to financial statements.

AB HIGH YIELD PORTFOLIO  • 41

Portfolio of Investments

STATEMENT OF ASSETS & LIABILITIES

October 31, 2015

Assets
Investments in securities, at value
Unaffiliated issuers (cost $18,621,809)	$	17,487,110
Affiliated issuers (cost $1,992,398)		1,992,398
Foreign currencies, at value (cost $194)		198
Dividends and interest receivable		294,915
Cash collateral due from broker		263,306
Receivable from Adviser		114,967
Receivable for capital stock sold		70,123
Receivable for investment securities sold and foreign currency transactions		53,852
Upfront premiums paid on credit default swaps		50,359
Unrealized appreciation on total return swaps		18,414
Unrealized appreciation on credit default swaps		12,345
Unrealized appreciation on forward currency exchange contracts		3,374
Receivable for variation margin on exchange-traded derivatives		2,922
Total assets		20,364,283
Liabilities
Payable for investment securities purchased and foreign currency transactions		321,050
Audit and tax fee payable		112,329
Dividends payable		65,242
Upfront premiums received on credit default swaps		23,911
Unrealized depreciation on credit default swaps		18,430
Payable for newly entered credit default swaps		12,856
Unrealized depreciation on forward currency exchange contracts		7,401
Options written, at value (premiums received $8,803)		5,356
Transfer Agent fee payable		1,504
Offering expenses payable		975
Distribution fee payable		646
Unrealized depreciation on total return swaps		494
Payable for capital stock redeemed		386
Swaptions written, at value (premiums received $594)		276
Accrued expenses and other liabilities		110,055
Total liabilities		680,911
Net Assets	$	19,683,372
Composition of Net Assets
Capital stock, at par	$	2,130
Additional paid-in capital		21,109,059
Undistributed net investment income		122,320
Accumulated net realized loss on investment and foreign currency transactions		(466,855	)
Net unrealized depreciation on investments and foreign currency denominated assets and liabilities		(1,083,282	)
	$	19,683,372

See notes to financial statements.

42 •  AB HIGH YIELD PORTFOLIO

Statement of Assets & Liabilities

Net Asset Value Per Share—30 billion shares of capital stock authorized, $.001 par value

Class	Net Assets		Shares Outstanding		Net Asset Value
A	$	2,741,974		296,847	$	9.24	*
C	$	119,137		12,895	$	9.24
Advisor	$	250,840		27,145	$	9.24
R	$	9,242		1,000	$	9.24
K	$	9,242		1,000	$	9.24
I	$	16,543,695		1,790,331	$	9.24
Z	$	9,242		1,000	$	9.24

* The maximum offering price per share for Class A shares was $9.65 which reflects a sales charge of 4.25%.

See notes to financial statements.

AB HIGH YIELD PORTFOLIO  • 43

Statement of Assets & Liabilities

STATEMENT OF OPERATIONS

Year Ended October 31, 2015

Investment Income
Interest	$	905,606
Dividends
Unaffiliated issuers (net of foreign taxes withheld of $60)		28,383
Affiliated issuers		1,484
Other Income		250		$	935,723
Expenses
Advisory fee (see Note B)		108,212
Distribution fee—Class A		1,225
Distribution fee—Class C		1,026
Distribution fee—Class R		48
Distribution fee—Class K		24
Transfer agency—Class A		6,988
Transfer agency—Class C		3,459
Transfer agency—Advisor Class		5,266
Transfer agency—Class R		6
Transfer agency—Class K		5
Transfer agency—Class I		3,453
Transfer agency—Class Z		2
Audit and tax		117,822
Amortization of offering expenses		101,109
Registration fees		91,362
Custodian		90,802
Administrative		52,405
Legal		41,306
Directors’ fees		18,764
Printing		16,361
Miscellaneous		59,185
Total expenses		718,830
Less: expenses waived and reimbursed by the Adviser (see Note B)		(572,066	)
Net expenses					146,764
Net investment income					788,959
Realized and Unrealized Gain (Loss) on Investment and Foreign Currency Transactions
Net realized gain (loss) on:
Investment transactions					(471,531	)
Swaps					(52,656	)
Futures					39,734
Options written					45,351
Swaptions written					35,475
Foreign currency transactions					61,832
Net change in unrealized appreciation/depreciation on:
Investments					(840,759	)
Swaps					44,527
Futures					(6,443	)
Options written					4,239
Swaptions written					(1,678	)
Foreign currency denominated assets and liabilities					(15,489	)
Net loss on investment and foreign currency transactions					(1,157,398	)
Net Decrease in Net Assets from Operations				$	(368,439	)

See notes to financial statements.

44 •  AB HIGH YIELD PORTFOLIO

Statement of Operations

STATEMENT OF CHANGES IN NET ASSETS

	Year Ended October 31, 2015			July 15, 2014* to October 31, 2014
Increase (Decrease) in Net Assets from Operations
Net investment income	$	788,959		$	193,271
Net realized gain (loss) on investment and foreign currency transactions		(341,795	)		95,040
Net change in unrealized appreciation/depreciation on investments and foreign currency denominated assets and liabilities		(815,603	)		(267,679	)
Net increase (decrease) in net assets from operations		(368,439	)		20,632
Dividends and Distributions to Shareholders from
Net investment income
Class A		(21,264	)		(192	)
Class C		(3,905	)		(72	)
Advisor Class		(7,335	)		(202	)
Class R		(422	)		(87	)
Class K		(446	)		(94	)
Class I		(844,746	)		(203,083	)
Class Z		(470	)		(102	)
Net realized gain on investment and foreign currency transactions
Class A		(52	)		– 0	–
Class C		(122	)		– 0	–
Advisor Class		(191	)		– 0	–
Class R		(14	)		– 0	–
Class K		(14	)		– 0	–
Class I		(24,706	)		– 0	–
Class Z		(14	)		– 0	–
Capital Stock Transactions
Net increase		992,821			20,145,891
Total increase (decrease)		(279,319	)		19,962,691
Net Assets
Beginning of period		19,962,691			– 0	–
End of period (including undistributed net investment income of $122,320 and $64,724, respectively)	$	19,683,372		$	19,962,691

* Commencement of operations.

See notes to financial statements.

AB HIGH YIELD PORTFOLIO  • 45

Statement of Changes in Net Assets

NOTES TO FINANCIAL STATEMENTS

October 31, 2015

NOTE A

Significant Accounting Policies

AB Bond Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940 as an open-end management investment company. Prior to January 20, 2015, the Fund was known as AllianceBernstein Bond Fund, Inc. The Fund, which is a Maryland corporation, operates as a series company comprised of nine portfolios currently in operation: AB Intermediate Bond Portfolio, AB Bond Inflation Strategy Portfolio, AB Municipal Bond Inflation Strategy Portfolio, AB All Market Real Return Portfolio, AB Limited Duration High Income Portfolio, AB Government Reserves Portfolio, AB Tax-Aware Fixed Income Portfolio, AB Credit Long/Short Portfolio and AB High Yield Portfolio. They are each diversified Portfolios, with the exception of AB Credit Long/Short Portfolio and AB High Yield Portfolio, which are non-diversified. AB Credit Long/Short Portfolio commenced operations on May 7, 2014. AB High Yield Portfolio commenced operations on July 15, 2014. Each Portfolio is considered to be a separate entity for financial reporting and tax purposes. This report relates only to AB High Yield Portfolio (the “Portfolio”). Prior to January 20, 2015, the Portfolio was known as AllianceBernstein High Yield Portfolio. The Portfolio has authorized the issuance of Class A, Class B, Class C, Advisor Class, Class R, Class K, Class I, Class Z, Class 1 and Class 2 shares. Class B, Class 1 and Class 2 shares are not currently publicly offered. As of October 31, 2015, AllianceBernstein L.P. (the “Adviser”) was the sole shareholder of Class R, Class K, Class I and Class Z shares. Class A shares are sold with a front-end sales charge of up to 4.25% for purchases not exceeding $1,000,000. With respect to purchases of $1,000,000 or more, Class A shares redeemed within one year of purchase may be subject to a contingent deferred sales charge of 1%. Class C shares are subject to a contingent deferred sales charge of 1% on redemptions made within the first year after purchase. Class R and Class K shares are sold without an initial or contingent deferred sales charge. Advisor Class, Class I and Class Z shares are sold without an initial or contingent deferred sales charge and are not subject to ongoing distribution expenses. All ten classes of shares have identical voting, dividend, liquidation and other rights, except that the classes bear different distribution and transfer agency expenses. Each class has exclusive voting rights with respect to its distribution plan. The financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) which require management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements and amounts of income and expenses during the reporting period. Actual results could differ from those estimates. The Fund is an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. The following is a summary of significant accounting policies followed by the Portfolio.

1. Security Valuation

Portfolio securities are valued at their current market value determined on the basis of market quotations or, if market quotations are not readily available or

46 •  AB HIGH YIELD PORTFOLIO

Notes to Financial Statements

are deemed unreliable, at “fair value” as determined in accordance with procedures established by and under the general supervision of the Portfolio’s Board of Directors (the “Board”).

In general, the market values of securities which are readily available and deemed reliable are determined as follows: securities listed on a national securities exchange (other than securities listed on the NASDAQ Stock Market, Inc. (“NASDAQ”)) or on a foreign securities exchange are valued at the last sale price at the close of the exchange or foreign securities exchange. If there has been no sale on such day, the securities are valued at the last traded price from the previous day. Securities listed on more than one exchange are valued by reference to the principal exchange on which the securities are traded; securities listed only on NASDAQ are valued in accordance with the NASDAQ Official Closing Price; listed or over the counter (“OTC”) market put or call options are valued at the mid level between the current bid and ask prices. If either a current bid or current ask price is unavailable, the Adviser will have discretion to determine the best valuation (e.g. last trade price in the case of listed options); open futures contracts are valued using the closing settlement price or, in the absence of such a price, the most recent quoted bid price. If there are no quotations available for the day of valuation, the last available closing settlement price is used; U.S. Government securities and any other debt instruments having 60 days or less remaining until maturity are generally valued at market by an independent pricing vendor, if a market price is available. If a market price is not available, the securities are valued at amortized cost. This methodology is commonly used for short-term securities that have an original maturity of 60 days or less, as well as short-term securities that had an original term to maturity that exceeded 60 days. In instances when amortized cost is utilized, the Valuation Committee (the “Committee”) must reasonably conclude that the utilization of amortized cost is approximately the same as the fair value of the security. Such factors the Committee will consider include, but are not limited to, an impairment of the creditworthiness of the issuer or material changes in interest rates. Fixed-income securities, including mortgage-backed and asset-backed securities, may be valued on the basis of prices provided by a pricing service or at a price obtained from one or more of the major broker-dealers. In cases where broker-dealer quotes are obtained, the Adviser may establish procedures whereby changes in market yields or spreads are used to adjust, on a daily basis, a recently obtained quoted price on a security. Swaps and other derivatives are valued daily, primarily using independent pricing services, independent pricing models using market inputs, as well as third party broker-dealers or counterparties. Investment companies are valued at their net asset value.

Securities for which market quotations are not readily available (including restricted securities) or are deemed unreliable are valued at fair value. Factors considered in making this determination may include, but are not limited to, information obtained by contacting the issuer, analysts, analysis of the issuer’s

AB HIGH YIELD PORTFOLIO  • 47

Notes to Financial Statements

financial statements or other available documents. In addition, the Portfolio may use fair value pricing for securities primarily traded in non-U.S. markets because most foreign markets close well before the Portfolio values its securities at 4:00 p.m., Eastern Time. The earlier close of these foreign markets gives rise to the possibility that significant events, including broad market moves, may have occurred in the interim and may materially affect the value of those securities. To account for this, the Portfolio may frequently value many of its foreign equity securities using fair value prices based on third party vendor modeling tools to the extent available.

2. Fair Value Measurements

In accordance with U.S. GAAP regarding fair value measurements, fair value is defined as the price that the Portfolio would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP establishes a framework for measuring fair value, and a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability (including those valued based on their market values as described in Note A.1 above). Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Portfolio. Unobservable inputs reflect the Portfolio’s own assumptions about the assumptions that market participants would use in pricing the asset or liability based on the best information available in the circumstances. Each investment is assigned a level based upon the observability of the inputs which are significant to the overall valuation. The three-tier hierarchy of inputs is summarized below.

• Level 1—quoted prices in active markets for identical investments

• Level 2—other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

• Level 3—significant unobservable inputs (including the Portfolio’s own assumptions in determining the fair value of investments)

The fair value of debt instruments, such as bonds, and over-the-counter derivatives is generally based on market price quotations, recently executed market transactions (where observable) or industry recognized modeling techniques and are generally classified as Level 2. Pricing vendor inputs to Level 2 valuations may include quoted prices for similar investments in active markets, interest rate curves, coupon rates, currency rates, yield curves, option adjusted spreads, default rates, credit spreads and other unique security features in order to estimate the relevant cash flows which is then discounted to calculate fair values. If these inputs are unobservable and significant to the fair value, these investments will be classified as Level 3. In addition, non-agency rated investments are classified as Level 3.

48 •  AB HIGH YIELD PORTFOLIO

Notes to Financial Statements

Where readily available market prices or relevant bid prices are not available for certain equity investments, such investments may be valued based on similar publicly traded investments, movements in relevant indices since last available prices or based upon underlying company fundamentals and comparable company data (such as multiples to earnings or other multiples to equity). Where an investment is valued using an observable input, such as another publicly traded security, the investment will be classified as Level 2. If management determines that an adjustment is appropriate based on restrictions on resale, illiquidity or uncertainty, and such adjustment is a significant component of the valuation, the investment will be classified as Level 3. An investment will also be classified as Level 3 where management uses company fundamentals and other significant inputs to determine the valuation.

Options are valued using market-based inputs to models, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency, where such inputs and models are available. Alternatively the values may be obtained through unobservable management determined inputs and/or management’s proprietary models. Where models are used, the selection of a particular model to value an option depends upon the contractual terms of, and specific risks inherent in, the option as well as the availability of pricing information in the market. Valuation models require a variety of inputs, including contractual terms, market prices, measures of volatility and correlations of such inputs. Exchange traded options generally will be classified as Level 2. For options that do not trade on exchange but trade in liquid markets, inputs can generally be verified and model selection does not involve significant management judgment. Options are classified within Level 2 on the fair value hierarchy when all of the significant inputs can be corroborated to market evidence. Otherwise such instruments are classified as Level 3.

Valuations of mortgage-backed or other asset-backed securities, by pricing vendors, are based on both proprietary and industry recognized models and discounted cash flow techniques. Significant inputs to the valuation of these instruments are value of the collateral, the rates and timing of delinquencies, the rates and timing of prepayments, and default and loss expectations, which are driven in part by housing prices for residential mortgages. Significant inputs are determined based on relative value analyses, which incorporate comparisons to instruments with similar collateral and risk profiles, including relevant indices. Mortgage and asset backed securities for which management has collected current observable data through pricing services are generally categorized within Level 2. Those investments for which current observable data has not been provided are classified as Level 3.

Other fixed income investments, including non-U.S. government and corporate debt, are generally valued using quoted market prices, if available, which are typically impacted by current interest rates, maturity dates and any perceived credit risk of the issuer. Additionally, in the absence of quoted market prices,

AB HIGH YIELD PORTFOLIO  • 49

Notes to Financial Statements

these inputs are used by pricing vendors to derive a valuation based upon industry or proprietary models which incorporate issuer specific data with relevant yield/spread comparisons with more widely quoted bonds with similar key characteristics. Those investments for which there are observable inputs are classified as Level 2. Where the inputs are not observable, the investments are classified as Level 3.

Bank loan prices are provided by third party pricing services and consist of a composite of the quotes received by the vendor into a consensus price. Bank loans are classified as Level 3, as significant input used in the fair value measurement of these instruments is the market quotes that are received by the vendor and these inputs are not observable.

The following table summarizes the valuation of the Portfolio’s investments by the above fair value hierarchy levels as of October 31, 2015:

Investments in Securities

Level 1

Level 2

Level 3

Total

Assets:

Corporates – Non-Investment Grade

$

– 0

–

$

14,007,240

$

182,978

^

$

14,190,218

Corporates – Investment Grade

– 0

–

997,096

– 0

–

997,096

Governments – Treasuries

– 0

–

617,912

– 0

–

617,912

Bank Loans

– 0

–

– 0

–

396,027

396,027

Common Stocks

356,852

2,146

2,982

361,980

Preferred Stocks

252,099

21,183

– 0

–

273,282

Commercial Mortgage-Backed Securities

– 0

–

– 0

–

225,864

225,864

Collateralized Mortgage Obligations

– 0

–

– 0

–

185,028

185,028

Investment Companies

50,058

– 0

–

– 0

–

50,058

Governments – Sovereign Agencies

– 0

–

37,661

– 0

–

37,661

Agencies

– 0

–

28,420

– 0

–

28,420

Warrants

– 0

–

– 0

–

11,721

11,721

Emerging Markets – Sovereigns

– 0

–

8,750

– 0

–

8,750

Options Purchased – Calls

– 0

–

5,487

– 0

–

5,487

Options Purchased – Puts

– 0

–

3,788

– 0

–

3,788

Short-Term Investments:

Investment Companies

1,992,398

– 0

–

– 0

–

1,992,398

Time Deposits

– 0

–

93,818

– 0

–

93,818

Total Investments in Securities

2,651,407

15,823,501

1,004,600

19,479,508

Other Financial Instruments*:

Assets

Credit Default Swaps

– 0

–

12,345

– 0

–

12,345

Centrally Cleared Credit Default Swaps

– 0

–

48,935

– 0

–

48,935

†

Forward Currency Exchange Contracts

– 0

–

3,374

– 0

–

3,374

Total Return Swaps

– 0

–

18,414

– 0

–

18,414

50 •  AB HIGH YIELD PORTFOLIO

Notes to Financial Statements

Investments in Securities	Level 1			Level 2			Level 3			Total
Liabilities
Credit Default Swaps	$	– 0	–	$	(18,430	)	$	– 0	–	$	(18,430	)
Futures		(8,950	)		– 0	–		– 0	–		(8,950	)†
Forward Currency Exchange Contracts		– 0	–		(7,401	)		– 0	–		(7,401	)
Total Return Swaps		– 0	–		(494	)		– 0	–		(494	)
Put Options Written		– 0	–		(5,356	)		– 0	–		(5,356	)
Credit Default Swaptions Written		– 0	–		(276	)		– 0	–		(276	)
Total**	$	2,642,457		$	15,874,612		$	1,004,600		$	19,521,669

^ The Portfolio held securities with zero market value at period end.

* Other financial instruments are derivative instruments, such as futures, forwards and swaps, which are valued at the unrealized appreciation/depreciation on the instrument. Other financial instruments may also include written options and swaptions which are valued at market value.

† Only variation margin receivable/payable at period end is reported within the statement of assets and liabilities. This amount reflects cumulative appreciation/depreciation on exchange-traded derivatives as reported in the portfolio of investments.

** There were no transfers between level 1 and level 2 during the reporting period.

The Portfolio recognizes all transfers between levels of the fair value hierarchy assuming the financial instrument was transferred at the beginning of the reporting period.

The following is a reconciliation of investments in which significant unobservable inputs (Level 3) were used in determining fair value.

	Corporates  - Non-Investment Grade#			Corporates - Investment Grade			Bank Loans			Common Stocks
Balance as of 10/31/14	$	207,734		$	34,600		$	326,756		$	– 0	–
Accrued discounts/ (premiums)		(4,561	)		– 0	–		1,465			– 0	–
Realized gain (loss)		(99	)		– 0	–		(1,384	)		– 0	–
Change in unrealized appreciation/depreciation		(17,979	)		– 0	–		(6,744	)		1,535
Purchases		37,392			– 0	–		164,973			1,447
Sales/Paydowns		(39,509	)		– 0	–		(89,039	)		– 0	–
Transfers into level 3		– 0	–		– 0	–		– 0	–		– 0	–
Transfers out of level 3		– 0	–		(34,600	)		– 0	–		– 0	–
Balance as of 10/31/15	$	182,978		$	– 0	–	$	396,027		$	2,982
Net change in unrealized appreciation/depreciation from investments held as of 10/31/15**	$	(16,780	)	$	– 0	–	$	(8,203	)	$	1,535

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Notes to Financial Statements

	Commercial Mortgage-Backed Securities			Collateralized Mortgage Obligations			Warrants			Total
Balance as of 10/31/14	$	238,158		$	262,347		$	– 0	–	$	1,069,595
Accrued discounts/ (premiums)		225			(5,744	)		– 0	–		(8,615	)
Realized gain (loss)		– 0	–		(5,771	)		– 0	–		(7,254	)
Change in unrealized appreciation/ depreciation		(12,519	)		2,930			7,501			(25,276	)
Purchases		– 0	–		– 0	–		4,220			208,032
Sales/Paydowns		– 0	–		(68,734	)		– 0	–		(197,282	)
Transfers into level 3		– 0	–		– 0	–		– 0	–		– 0	–
Transfers out of level 3		– 0	–		– 0	–		– 0	–		(34,600	)
Balance as of 10/31/15	$	225,864		$	185,028		$	11,721		$	1,004,600	+
Net change in unrealized appreciation/depreciation from investments held as of 10/31/15**	$	(12,519	)	$	(2,333	)	$	7,501		$	(30,799	)

# The Portfolio held securities with zero market value at period end.

** The unrealized appreciation/depreciation is included in net change in unrealized appreciation/depreciation on investments and other financial instruments in the accompanying statement of operations.

+ There were de minimis transfers under 1% of net assets during the reporting period.

The following presents information about significant unobservable inputs related to the Portfolio’s Level 3 investments at October 31, 2015. Securities priced by (i) third party vendors or (ii) using prior transaction prices, which approximates fair value, are excluded from the following table:

	Quantitative Information about Level 3 Fair Value Measurements
	Fair Value at 10/31/2015	Valuation Technique		Unobservable Input		Range/ Weighted Average
Bank Loans	$33,544		Market Approach		EBITDA* Projection	$28mm-$70mm/N/A
					EBITDA* Multiple	6x/N/A
					Scrap Value	$154mm/N/A

* Earnings Before Interest, Taxes, Depreciation and Amortization.

The Adviser established the Committee to oversee the pricing and valuation of all securities held in the Portfolios. The Committee operates under pricing and valuation policies and procedures established by the Adviser and approved by the Board, including pricing policies which set forth the mechanisms and processes to be employed on a daily basis to implement these policies and procedures. In particular, the pricing policies describe how to determine market quotations for securities and other instruments. The Committee’s responsibilities include: 1) fair value and liquidity determinations (and oversight of any third parties to whom any responsibility for fair value and liquidity determinations is delegated),

52 •  AB HIGH YIELD PORTFOLIO

Notes to Financial Statements

and 2) regular monitoring of the Adviser’s pricing and valuation policies and procedures and modification or enhancement of these policies and procedures (or recommendation of the modification of these policies and procedures) as the Committee believes appropriate.

The Committee is also responsible for monitoring the implementation of the pricing policies by the Adviser’s Pricing Group (the “Pricing Group”) and a third party which performs certain pricing functions in accordance with the pricing policies. The Pricing Group is responsible for the oversight of the third party on a day-to-day basis. The Committee and the Pricing Group perform a series of activities to provide reasonable assurance of the accuracy of prices including: 1) periodic vendor due diligence meetings, review of methodologies, new developments, process at vendors, 2) daily comparisons of security valuation versus prior day for all securties that exceeded established thresholds, and 3) daily review of unpriced, stale, and variance reports with exceptions reviewed by senior management and the Committee.

In addition, several processes outside of the pricing process are used to monitor valuation issues including: 1) performance and performance attribution reports are monitored for anomalous impacts based upon benchmark performance, and 2) portfolio managers review all portfolios for performance and analytics (which are generated using the Adviser’s prices).

3. Currency Translation

Assets and liabilities denominated in foreign currencies and commitments under forward currency exchange contracts are translated into U.S. dollars at the mean of the quoted bid and ask prices of such currencies against the U.S. dollar. Purchases and sales of portfolio securities are translated into U.S. dollars at the rates of exchange prevailing when such securities were acquired or sold. Income and expenses are translated into U.S. dollars at the rates of exchange prevailing when accrued.

Net realized gain or loss on foreign currency transactions represents foreign exchange gains and losses from sales and maturities of foreign fixed income investments, foreign currency exchange contracts, holding of foreign currencies, currency gains or losses realized between the trade and settlement dates on foreign investment transactions, and the difference between the amounts of dividends, interest and foreign withholding taxes recorded on the Portfolio’s books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized currency gains and losses from valuing foreign currency denominated assets and liabilities at period end exchange rates are reflected as a component of net unrealized appreciation and depreciation on foreign currency denominated assets and liabilities.

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Notes to Financial Statements

4. Taxes

It is the Portfolio’s policy to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its investment company taxable income and net realized gains, if any, to shareholders. Therefore, no provisions for federal income or excise taxes are required. The Portfolio may be subject to taxes imposed by countries in which it invests. Such taxes are generally based on income and/or capital gains earned or repatriated. Taxes are accrued and applied to net investment income, net realized gains and net unrealized appreciation/depreciation as such income and/or gains are earned.

In accordance with U.S. GAAP requirements regarding accounting for uncertainties in income taxes, management has analyzed the Portfolio’s tax positions taken or expected to be taken on federal and state income tax returns for all open tax years (all years since inception of the Portfolio) and has concluded that no provision for income tax is required in the Portfolio’s financial statements.

5. Investment Income and Investment Transactions

Dividend income is recorded on the ex-dividend date or as soon as the Portfolio is informed of the dividend. Interest income is accrued daily. Investment transactions are accounted for on the date securities are purchased or sold. Investment gains or losses are determined on the identified cost basis. The Portfolio amortizes premiums and accretes discounts as adjustments to interest income.

6. Class Allocations

All income earned and expenses incurred by the Portfolio are borne on a prorate basis by each outstanding class of shares, based on the proportionate interest in the Portfolio represented by the net assets of such class, except for class specific expenses which are allocated to the respective class. Expenses of the Fund are charged proportionately to each Portfolio or based on other appropriate methods. Realized and unrealized gains and losses are allocated among the various share classes based on respective net assets.

7. Dividends and Distributions

Dividends and distributions to shareholders, if any, are recorded on the ex-dividend date. Income dividends and capital gains distributions are determined in accordance with federal tax regulations and may differ from those determined in accordance with U.S. GAAP. To the extent these differences are permanent, such amounts are reclassified within the capital accounts based on their federal tax basis treatment; temporary differences do not require such reclassification.

8. Offering Expenses

Offering expenses of $142,762 were deferred and amortized on a straight line basis over a one year period starting from July 15, 2014 (commencement of operations).

54 •  AB HIGH YIELD PORTFOLIO

Notes to Financial Statements

NOTE B

Advisory Fee and Other Transactions with Affiliates

Under the terms of the investment advisory agreement, the Portfolio pays the Adviser an advisory fee at an annual rate of .60% of the first $2.5 billion, .55% of the next $2.5 billion and .50% in excess of $5 billion, of the Portfolio’s average daily net assets. The fee is accrued daily and paid monthly. The Adviser has agreed to waive its fees and bear certain expenses to the extent necessary to limit total operating expenses on an annual basis (the “Expense Caps”) to 1.05%, 1.80%, .80%, 1.30%, 1.05%, .80%, and .80% of the daily average net assets for the Class A, Class C, Advisor Class, Class R, Class K, Class I, and Class Z shares, respectively. Any fees waived and expenses borne by the Adviser through October 31, 2014 are subject to repayment by the Portfolio until October 31, 2017. Any fees waived and expenses borne by the Adviser from November 1, 2014 to July 14, 2015 are subject to repayment by the Portfolio until October 31, 2018, provided that no repayment will be made that would cause the Portfolio’s total annual operating expenses to exceed the net fee percentage set forth per the Expense Caps. The Expense Caps may not be terminated before January 29, 2016. For the year ended October 31, 2015, such waiver/reimbursement amounted to $519,661.

Pursuant to the investment advisory agreement, the Portfolio may reimburse the Adviser for certain legal and accounting services provided to the Portfolio by the Adviser. For the year ended October 31, 2015, the Adviser voluntarily agreed to waive such fees in the amount of $52,405.

The Portfolio compensates AllianceBernstein Investor Services, Inc. (“ABIS”), a wholly-owned subsidiary of the Adviser, under a Transfer Agency Agreement for providing personnel and facilities to perform transfer agency services for the Portfolio. ABIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. Such compensation retained by ABIS amounted to $18,000 for the year ended October 31, 2015.

AllianceBernstein Investments, Inc. (the “Distributor”), a wholly-owned subsidiary of the Adviser, serves as the distributor of the Portfolio’s shares. The Distributor has advised the Portfolio that it has retained front-end sales charges of $696 from the sale of Class A shares and received $46 in contingent deferred sales charges imposed upon redemptions by shareholders of Class C shares for the year ended October 31, 2015.

The Portfolio may invest in the AB Fixed-Income Shares, Inc. – Government STIF Portfolio (“Government STIF Portfolio”), an open-end management investment company managed by the Adviser. The Government STIF Portfolio is offered as a cash management option to mutual funds and other institutional accounts of the Adviser, and is not available for direct purchase by members of the public. The Government STIF Portfolio pays no investment management

AB HIGH YIELD PORTFOLIO  • 55

Notes to Financial Statements

fees but does bear its own expenses. A summary of the Portfolio’s transactions in shares of the Government STIF Portfolio for the year ended October 31, 2015 is as follows:

Market Value October 31, 2014 (000)		Purchases at Cost (000)		Sales Proceeds (000)		Market Value October 31, 2015 (000)		Dividend Income (000)
$	1,841	$	9,187	$	9,036	$	1,992	$	1

Brokerage commissions paid on investment transactions for the year ended October 31, 2015 amounted to $8,524, none of which was paid to Sanford C. Bernstein & Co. LLC or Sanford C. Bernstein Limited, respectively, affiliates of the Adviser.

NOTE C

Distribution Services Agreement

The Portfolio has adopted a Distribution Services Agreement (the “Agreement”) pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the Agreement, the Portfolio pays distribution and servicing fees to the Distributor at an annual rate of up to .25% of the Portfolio’s average daily net assets attributable to Class A shares, 1% of the Portfolio’s average daily net assets attributable to Class C shares, .50% of the Portfolio’s average daily net assets attributable to Class R shares and .25% of the Portfolio’s average daily net assets attributable to Class K shares. There are no distribution and servicing fees on Advisor Class, Class I and Class Z shares. The fees are accrued daily and paid monthly. The Agreement provides that the Distributor will use such payments in their entirety for distribution assistance and promotional activities. Since the commencement of the Portfolio’s operations, the Distributor has incurred expenses in excess of the distribution costs reimbursed by the Portfolio in the amount of $490 for Class C shares. While such costs may be recovered from the Portfolio in future periods so long as the Agreement is in effect, the rate of the distribution and servicing fees payable under the Agreement may not be increased without a shareholder vote. In accordance with the Agreement, there is no provision for recovery of unreimbursed distribution costs incurred by the Distributor beyond the current fiscal year for Class A shares. The Agreement also provides that the Adviser may use its own resources to finance the distribution of the Portfolio’s shares.

NOTE D

Investment Transactions

Purchases and sales of investment securities (excluding short-term investments) for the year ended October 31, 2015 were as follows:

	Purchases		Sales
Investment securities (excluding U.S. government securities)	$	9,706,807	$	9,267,764
U.S. government securities		599,367		– 0	–

56 •  AB HIGH YIELD PORTFOLIO

Notes to Financial Statements

The cost of investments for federal income tax purposes, gross unrealized appreciation and unrealized depreciation (excluding foreign currency exchange contracts, written options, swaps and futures) are as follows:

Cost	$	20,638,891
Gross unrealized appreciation	$	154,245
Gross unrealized depreciation		(1,313,628	)
Net unrealized depreciation	$	(1,159,383	)

1. Derivative Financial Instruments

The Portfolio may use derivatives in an effort to earn income and enhance returns, to replace more traditional direct investments, to obtain exposure to otherwise inaccessible markets (collectively, “investment purposes”), or to hedge or adjust the risk profile of its portfolio.

The principal types of derivatives utilized by the Portfolio, as well as the methods in which they may be used are:

• Forward Currency Exchange Contracts

The Portfolio may enter into forward currency exchange contracts in order to hedge its exposure to changes in foreign currency exchange rates on its foreign portfolio holdings, to hedge certain firm purchase and sales commitments denominated in foreign currencies and for non-hedging purposes as a means of making direct investments in foreign currencies, as described below under “Currency Transactions”.

A forward currency exchange contract is a commitment to purchase or sell a foreign currency at a future date at a negotiated forward rate. The gain or loss arising from the difference between the original contract and the closing of such contract would be included in net realized gain or loss on foreign currency transactions. Fluctuations in the value of open forward currency exchange contracts are recorded for financial reporting purposes as unrealized appreciation and/or depreciation by the Portfolio. Risks may arise from the potential inability of a counterparty to meet the terms of a contract and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar.

During the year ended October 31, 2015, the Portfolio held forward currency exchange contracts for hedging and non-hedging purposes.

• Futures

The Portfolio may buy or sell futures for investment purposes or for the purpose of hedging its portfolio against adverse effects of potential movements in the market. The Portfolio bears the market risk that arises from changes in the value of these instruments and the imperfect correlation between movements in the price of the futures and movements in the price of the assets, reference rates or indices which they are designed

AB HIGH YIELD PORTFOLIO  • 57

Notes to Financial Statements

to track. Among other things, the Portfolio may purchase or sell futures for foreign currencies or options thereon for non-hedging purposes as a means of making direct investment in foreign currencies, as described below under “Currency Transactions”.

At the time the Portfolio enters into a future, the Portfolio deposits and maintains as collateral an initial margin with the broker, as required by the exchange on which the transaction is effected. Such amount is shown as cash collateral due from broker on the statement of assets and liabilities. Pursuant to the contract, the Portfolio agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments are known as variation margin and are recorded by the Portfolio as unrealized gains or losses. Risks may arise from the potential inability of a counterparty to meet the terms of the contract. The credit/counterparty risk for exchange-traded futures is generally less than privately negotiated futures, since the clearinghouse, which is the issuer or counterparty to each exchange-traded future, has robust risk mitigation standards, including the requirement to provide initial and variation margin. When the contract is closed, the Portfolio records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the time it was closed.

Use of long futures subjects the Portfolio to risk of loss in excess of the amounts shown on the statement of assets and liabilities, up to the notional value of the future. Use of short futures subjects the Portfolio to unlimited risk of loss. Under some circumstances, futures exchanges may establish daily limits on the amount that the price of a future can vary from the previous day’s settlement price, which could effectively prevent liquidation of unfavorable positions.

During the year ended October 31, 2015, the Portfolio held futures for hedging purposes.

• Option Transactions

For hedging and investment purposes, the Portfolio may purchase and write (sell) put and call options on U.S. and foreign securities, including government securities, and foreign currencies that are traded on U.S. and foreign securities exchanges and over-the-counter markets. Among other things, the Portfolio may use options transactions for non-hedging purposes as a means of making direct investments in foreign currencies, as described below under “Currency Transactions” and may use options strategies involving the purchase and/or writing of various combinations of call and/or put options, for hedging and investment purposes.

The risk associated with purchasing an option is that the Portfolio pays a premium whether or not the option is exercised. Additionally, the Portfolio bears the risk of loss of the premium and change in market value should the counterparty not perform under the contract. Put and call

58 •  AB HIGH YIELD PORTFOLIO

Notes to Financial Statements

options purchased are accounted for in the same manner as portfolio securities. The cost of securities acquired through the exercise of call options is increased by premiums paid. The proceeds from securities sold through the exercise of put options are decreased by the premiums paid.

When the Portfolio writes an option, the premium received by the Portfolio is recorded as a liability and is subsequently adjusted to the current market value of the option written. Premiums received from written options which expire unexercised are recorded by the Portfolio on the expiration date as realized gains from options written. The difference between the premium received and the amount paid on effecting a closing purchase transaction, including brokerage commissions, is also treated as a realized gain, or if the premium received is less than the amount paid for the closing purchase transaction, as a realized loss. If a call option is exercised, the premium received is added to the proceeds from the sale of the underlying security or currency in determining whether the Portfolio has realized a gain or loss. If a put option is exercised, the premium received reduces the cost basis of the security or currency purchased by the Portfolio. In writing an option, the Portfolio bears the market risk of an unfavorable change in the price of the security or currency underlying the written option. Exercise of an option written by the Portfolio could result in the Portfolio selling or buying a security or currency at a price different from the current market value.

At October 31, 2015, the maximum payments for written put options amounted to $1,780,600. In certain circumstances maximum payout amounts may be partially offset by recovery values of the respective referenced assets and upfront premiums received upon entering into the contract.

The Portfolio may also invest in options on swap agreements, also called “swaptions”. A swaption is an option that gives the buyer the right, but not the obligation, to enter into a swap on a future date in exchange for paying a market-based “premium”. A receiver swaption gives the owner the right to receive the total return of a specified asset, reference rate, or index. A payer swaption gives the owner the right to pay the total return on a specified asset, reference rate, or index. Swaptions also include options that allow an existing swap to be terminated or extended by one of the counterparties.

During the year ended October 31, 2015, the Portfolio held purchased options for hedging purposes.

During the year ended October 31, 2015, the Portfolio held written options for hedging purposes.

AB HIGH YIELD PORTFOLIO  • 59

Notes to Financial Statements

For the year ended October 31, 2015, the Portfolio had the following transactions in written options:

	Number of Contracts			Premiums Received
Options written outstanding as of 10/31/14		150		$	12,293
Options written		542,861			75,330
Options expired		(690	)		(56,244	)
Options bought back		(542,157	)		(22,576	)
Options exercised		– 0	–		– 0	–
Options written outstanding as of 10/31/15		164		$	8,803

For the year ended October 31, 2015, the Portfolio had the following transactions in written swaptions:

	Notional Amount			Premiums Received
Swaptions written outstanding as of 10/31/14	$	3,760,000		$	9,332
Swaptions written		9,840,000			26,737
Swaptions expired		(12,940,000	)		(35,475	)
Swaptions bought back		– 0	–		– 0	–
Swaptions exercised		– 0	–		– 0	–
Swaptions written outstanding as of 10/31/15	$	660,000		$	594

• Swaps

The Portfolio may enter into swaps to hedge its exposure to interest rates, credit risk, or currencies. The Portfolio may also enter into swaps for non-hedging purposes as a means of gaining market exposures including by making direct investments in foreign currencies, as described below under “Currency Transactions”. A swap is an agreement that obligates two parties to exchange a series of cash flows at specified intervals based upon or calculated by reference to changes in specified prices or rates for a specified amount of an underlying asset. The payment flows are usually netted against each other, with the difference being paid by one party to the other. In addition, collateral may be pledged or received by the Portfolio in accordance with the terms of the respective swaps to provide value and recourse to the Portfolio or its counterparties in the event of default, bankruptcy or insolvency by one of the parties to the swap.

Risks may arise as a result of the failure of the counterparty to the swap to comply with the terms of the swap. The loss incurred by the failure of a counterparty is generally limited to the net interim payment to be received by the Portfolio, and/or the termination value at the end of the contract. Therefore, the Portfolio considers the creditworthiness of each counterparty to a swap in evaluating potential counterparty risk. This risk is mitigated by having a netting arrangement between the Portfolio and the counterparty and by the posting of collateral by the counterparty to the Portfolio to cover the Portfolio’s exposure to the counterparty. Additionally, risks may arise from unanticipated movements in interest rates or in the value of the underlying securities. The Portfolio accrues for

60 •  AB HIGH YIELD PORTFOLIO

Notes to Financial Statements

the interim payments on swaps on a daily basis, with the net amount recorded within unrealized appreciation/depreciation of swaps on the statement of assets and liabilities, where applicable. Once the interim payments are settled in cash, the net amount is recorded as realized gain/(loss) on swaps on the statement of operations, in addition to any realized gain/(loss) recorded upon the termination of swaps. Upfront premiums paid or received are recognized as cost or proceeds on the statement of assets and liabilities and are amortized on a straight line basis over the life of the contract. Amortized upfront premiums are included in net realized gain/(loss) from swaps on the statement of operations. Fluctuations in the value of swaps are recorded as a component of net change in unrealized appreciation/depreciation on swaps on the statement of operations.

Certain standardized swaps, including certain interest rate swaps and credit default swaps, are (or soon will be) subject to mandatory central clearing. Cleared swaps are transacted through futures commission merchants (“FCMs”) that are members of central clearinghouses, with the clearinghouse serving as central counterparty, similar to transactions in futures contracts. Centralized clearing will be required for additional categories of swaps on a phased-in basis based on requirements published by the Securities Exchange Commission and Commodity Futures Trading Commission.

At the time the Portfolio enters into a centrally cleared swap, the Portfolio deposits and maintains as collateral an initial margin with the broker, as required by the clearinghouse on which the transaction is effected. Such amount is shown as cash collateral due from broker on the statement of assets and liabilities. Pursuant to the contract, the Portfolio agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments are known as variation margin and are recorded by the Portfolio as unrealized gains or losses. Risks may arise from the potential inability of a counterparty to meet the terms of the contract. The credit/counterparty risk for centrally cleared swaps is generally less than non-centrally cleared swaps, since the clearinghouse, which is the issuer or counterparty to each centrally cleared swap, has robust risk mitigation standards, including the requirement to provide initial and variation margin. When the contract is closed, the Portfolio records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the time it was closed.

Credit Default Swaps:

The Portfolio may enter into credit default swaps, including to manage its exposure to the market or certain sectors of the market, to reduce its risk exposure to defaults by corporate and sovereign issuers held by the Portfolio, or to create exposure to corporate or sovereign issuers to which it is not otherwise exposed. The Portfolio may purchase credit protection (“Buy Contract”) or provide credit protection (“Sale Contract”) on the referenced obligation of the credit default swap. During the term of the

AB HIGH YIELD PORTFOLIO  • 61

Notes to Financial Statements

swap agreement, the Portfolio receives/(pays) fixed payments from/(to) the respective counterparty, calculated at the agreed upon interest rate applied to the notional amount. If the Portfolio is a buyer/(seller) of protection and a credit event occurs, as defined under the terms of the swap agreement, the Portfolio will either (i) receive from the seller/(pay to the buyer) of protection an amount equal to the notional amount of the swap contract (the “Maximum Payout Amount”) and deliver/(take delivery of) the referenced obligation or (ii) receive/(pay) a net settlement amount in the form of cash or securities equal to the notional amount of the swap less the recovery value of the referenced obligation.

In certain circumstances Maximum Payout Amounts may be partially offset by recovery values of the respective referenced obligations, upfront premium received upon entering into the agreement, or net amounts received from settlement of buy protection credit default swap agreements entered into by the Portfolio for the same reference obligation with the same counterparty. As of October 31, 2015, the Portfolio had Buy Contracts outstanding with respect to the same referenced obligation and counterparty as certain Sale Contracts which may partially offset the Maximum Payout Amount in the amount of $40,000.

Credit default swaps may involve greater risks than if the Portfolio had invested in the referenced obligation directly. Credit default swaps are subject to general market risk, liquidity risk, counterparty risk and credit risk. If the Portfolio is a buyer of protection and no credit event occurs, it will lose its investment. If the Portfolio is a seller of protection and a credit event occurs, the value of the referenced obligation received by the Portfolio coupled with the periodic payments previously received may be less than the Maximum Payout Amount it pays to the buyer, resulting in a net loss to the Portfolio.

Implied credit spreads over Treasuries of comparable maturity utilized in determining the market value of credit default swaps on issuers as of period end are disclosed in the portfolio of investments. The implied spreads serve as an indicator of the current status of the payment/performance risk and typically reflect the market’s assessment of the likelihood of default by the issuer of the referenced obligation. The implied credit spread of a particular reference entity reflects the cost of buying/selling protection and may include upfront payments required to be made to enter into the agreement. Widening credit spreads typically represent a deterioration of the referenced entity’s credit soundness and greater likelihood of default or other credit event occurring as defined under the terms of the agreement. A credit spread identified as “Defaulted” indicates a credit event has occurred for the referenced entity or obligation.

During the year ended October 31, 2015, the Portfolio held credit default swaps for hedging and non-hedging purposes.

62 •  AB HIGH YIELD PORTFOLIO

Notes to Financial Statements

Interest Rate Swaps:

The Portfolio is subject to interest rate risk exposure in the normal course of pursuing its investment objectives. Because the Portfolio holds fixed rate bonds, the value of these bonds may decrease if interest rates rise. To help hedge against this risk and to maintain its ability to generate income at prevailing market rates, the Portfolio may enter into interest rate swaps. Interest rate swaps are agreements between two parties to exchange cash flows based on a notional amount. The Portfolio may elect to pay a fixed rate and receive a floating rate, or, receive a fixed rate and pay a floating rate on a notional amount.

In addition, the Portfolio may also enter into interest rate swap transactions to preserve a return or spread on a particular investment or portion of its portfolio, or protecting against an increase in the price of securities the Portfolio anticipate purchasing at a later date. Interest rate swaps involve the exchange by a Portfolio with another party of their respective commitments to pay or receive interest (e.g., an exchange of floating rate payments for fixed rate payments) computed based on a contractually-based principal (or “notional”) amount. Interest rate swaps are entered into on a net basis (i.e., the two payment streams are netted out, with the Portfolio receiving or paying, as the case may be, only the net amount of the two payments).

During the year ended October 31, 2015, the Portfolio held interest rate swaps for hedging and non-hedging purposes.

Total Return Swaps:

The Portfolio may enter into total return swaps in order take a “long” or “short” position with respect to an underlying referenced asset. The Portfolio is subject to market price volatility of the underlying referenced asset. A total return swap involves commitments to pay interest in exchange for a market linked return based on a notional amount. To the extent that the total return of the security, group of securities or index underlying the transaction exceeds or falls short of the offsetting interest obligation, the Portfolio will receive a payment from or make a payment to the counterparty.

During the year ended October 31, 2015, the Portfolio held total return swaps for non-hedging purposes.

The Portfolio typically enters into International Swaps and Derivatives Association, Inc. Master Agreements (“ISDA Master Agreement”) or similar master agreements (collectively, “Master Agreements”) with its derivative contract counterparties in order to, among other things, reduce its credit risk to counterparties. ISDA Master Agreements include provisions for general obligations, representations, collateral and events of default or termination. Under an ISDA Master Agreement, the Portfolio typically may offset with the counterparty certain derivative financial instrument’s payables and/or receivables with collateral held and/or

AB HIGH YIELD PORTFOLIO  • 63

Notes to Financial Statements

posted and create one single net payment (close-out netting) in the event of default or termination.

Various master agreements govern the terms of certain transactions with counterparties, including transactions such as derivative transactions, repurchase and reverse repurchase agreements. These Master Agreements typically attempt to reduce the counterparty risk associated with such transactions by specifying credit protection mechanisms and providing standardization that improves legal certainty. Cross-termination provisions under Master Agreements typically provide that a default in connection with one transaction between the Portfolio and a counterparty gives the non-defaulting party the right to terminate any other transactions in place with the defaulting party to create one single net payment due to/due from the defaulting party. In the event of a default by a Master Agreements counterparty, the return of collateral with market value in excess of the Portfolio’s net liability, held by the defaulting party, may be delayed or denied.

The Portfolio’s Master Agreements may contain provisions for early termination of derivative transactions in the event the net assets of the Portfolio decline below specific levels (“net asset contingent features”). If these levels are triggered, the Portfolio’s counterparty has the right to terminate such transaction and require the Portfolio to pay or receive a settlement amount in connection with the terminated transaction. For additional details, please refer to netting arrangements by counterparty tables below.

At October 31, 2015, the Portfolio had entered into the following derivatives:

	Asset Derivatives			Liability Derivatives
Derivative Type	Statement of Assets and Liabilities Location	Fair Value		Statement of Assets and Liabilities Location	Fair Value
Interest rate contracts				Receivable/Payable for variation margin on exchange-traded derivatives	$	1,867	*
Interest rate contracts	Investments in securities, at value	$	204	Options written, at value		1,326
Interest rate contracts	Unrealized appreciation on total return swaps		18,414	Unrealized depreciation on total return swaps		494
Foreign exchange contracts	Unrealized appreciation on forward currency exchange contracts		3,374	Unrealized depreciation on forward currency exchange contracts		7,401

64 •  AB HIGH YIELD PORTFOLIO

Notes to Financial Statements

	Asset Derivatives				Liability Derivatives
Derivative Type	Statement of Assets and Liabilities Location	Fair Value			Statement of Assets and Liabilities Location	Fair Value
Credit contracts	Unrealized appreciation on credit default swaps		12,345		Unrealized depreciation on credit default swaps		18,430
Credit contracts	Receivable/Payable for variation margin on exchange-traded derivatives	$	48,935	*
Credit contracts	Investments in securities, at value		1,277		Swaptions written, at value	$	276
Equity contracts					Receivable/Payable for variation margin on exchange-traded derivatives		7,083	*
Equity contracts	Investment in securities, at value		7,794		Options written, at value		4,030
Total		$	92,343			$	40,907

* Only variation margin receivable/payable at period end is reported within the statement of assets and liabilities. This amount reflects cumulative appreciation/(depreciation) on exchange-traded derivatives as reported in the portfolio of investments.

The effect of derivative instruments on the statement of operations for the year ended October 31, 2015:

Derivative Type	Location of Gain or (Loss) on Derivatives	Realized Gain or (Loss) on Derivatives			Change in Unrealized Appreciation or (Depreciation)
Interest rate contracts	Net realized gain/(loss) on swaps; Net change in unrealized appreciation/ depreciation on swaps	$	(43,009	)	$	9,227
Interest rate contracts	Net realized gain/(loss) on futures; Net change in unrealized appreciation/ depreciation on futures		23,041			(1,867	)
Interest rate contracts	Net realized gain/(loss) on investment transactions; Net change in unrealized appreciation/depreciation on investment transactions		(23,773	)		(8,015	)

AB HIGH YIELD PORTFOLIO  • 65

Notes to Financial Statements

Derivative Type	Location of Gain or (Loss) on Derivatives	Realized Gain or (Loss) on Derivatives			Change in Unrealized Appreciation or (Depreciation)
Interest rate contracts	Net realized gain/(loss) on options written; Net change in unrealized appreciation/depreciation on options written	$	– 0	–	$	2,648
Foreign exchange contracts	Net realized gain/(loss) on foreign currency transactions; Net change in unrealized appreciation/depreciation on foreign currency denominated assets and liabilities		99,623			(16,235	)
Foreign exchange contracts	Net realized gain/(loss) on investment transactions; Net change in unrealized appreciation/depreciation on investment transactions		(2,493	)		– 0	–
Foreign exchange contracts	Net realized gain/(loss) on options written; Net change in unrealized appreciation/depreciation on options written		2,007			– 0	–
Credit contracts	Net realized gain/(loss) on investment transactions; Net change in unrealized appreciation/depreciation on investment transactions		(57,356	)		2,126
Credit contracts	Net realized gain/(loss) on swaps; Net change in unrealized appreciation/ depreciation on swaps		(9,647	)		35,300
Credit Contracts	Net realized gain/(loss) on swaptions written; Net change in unrealized appreciation/depreciation on swaptions written		35,475			(1,678	)

66 •  AB HIGH YIELD PORTFOLIO

Notes to Financial Statements

Derivative Type	Location of Gain or (Loss) on Derivatives	Realized Gain or (Loss) on Derivatives			Change in Unrealized Appreciation or (Depreciation)
Equity contracts	Net realized gain/(loss) on futures; Net change in unrealized appreciation/depreciation on futures	$	16,693		$	(4,576	)
Equity contracts	Net realized gain/(loss) on investment transactions; Net change in unrealized appreciation/depreciation on investment transactions		(77,432	)		10,727
Equity contracts	Net realized gain/(loss) on options written; Net change in unrealized appreciation/depreciation on options written		43,344			1,591
Total		$	6,473		$	29,248

The following table represents the average monthly volume of the Portfolio’s derivative transactions during the year ended October 31, 2015:

Centrally Cleared Credit Default Swaps:
Average notional amount of buy contracts	$	723,672
Average notional amount of sale contracts	$	1,067,260	(a)
Centrally Cleared Interest Rate Swaps:
Average notional amount	$	1,913,333	(b)
Credit Default Swaps:
Average notional amount of buy contracts	$	175,714
Average notional amount of sale contracts	$	593,667
Forward Currency Exchange Contracts:
Average principal amount of buy contracts	$	274,042
Average principal amount of sale contracts	$	1,138,145
Futures:
Average notional amount of buy contracts	$	1,508,038	(c)
Average notional amount of sale contracts	$	128,467	(d)
Total Return Swaps:
Average notional amount	$	1,115,923
Purchased Options:
Average cost	$	36,471

^(a) Positions were open for eight months during the year.

^(b)  Positions were open for six months during the year.

^(c)  Positions were open for nine months during the year.

^(d)  Positions were open for ten months during the year.

AB HIGH YIELD PORTFOLIO  • 67

Notes to Financial Statements

For financial reporting purposes, the Portfolio does not offset derivative assets and derivative liabilities that are subject to netting arrangements in the statement of assets and liabilities.

All derivatives held at year end were subject to netting arrangements. The following tables present the Portfolio’s derivative assets and liabilities by counterparty net of amounts available for offset under Master Agreements (“MA”) and net of the related collateral received/pledged by the Portfolio as of October 31, 2015:

Counterparty	Derivative Assets Subject to a MA		Derivatives Available for Offset			Cash Collateral Received			Security Collateral Received			Net Amount of Derivatives Assets
Exchange-Traded Derivatives:
Citigroup Global Markets, Inc.*	$	1,758	$	– 0	–	$	– 0	–	$	– 0	–	$	1,758
Morgan Stanley & Co., LLC*		5,331		(5,331	)		– 0	–		– 0	–		– 0	–
Total	$	7,089	$	(5,331	)	$	– 0	–	$	– 0	–	$	1,758
OTC Derivatives:
Bank of America, N.A.	$	6,997	$	(6,997	)	$	– 0	–	$	– 0	–	$	– 0	–
Barclays Bank PLC		15,223		(276	)		– 0	–		– 0	–		14,947
Brown Brothers Harriman & Co.		2,484		(2,484	)		– 0	–		– 0	–		– 0	–
Credit Suisse International		13,068		(812	)		– 0	–		– 0	–		12,256
Deutsche Bank AG		3,838		(911	)		– 0	–		– 0	–		2,927
Goldman Sachs Bank USA / Goldman Sachs International		12,500		(5,100	)		– 0	–		– 0	–		7,400
JPMorgan Chase Bank, NA		18,626		– 0	–		– 0	–		– 0	–		18,626
Morgan Stanley & Co. International PLC		12,150		(12,150	)		– 0	–		– 0	–		– 0	–
Standard Chartered Bank		410		(410	)		– 0	–		– 0	–		– 0	–
Total	$	85,296	$	(29,140	)	$	– 0	–	$	– 0	–	$	56,156	^

Counterparty	Derivative Liabilities Subject to a MA		Derivatives Available for Offset			Cash Collateral Pledged			Security Collateral Pledged			Net Amount of  Derivatives Liabilities
Exchange-Traded Derivatives:
Morgan Stanley & Co., LLC*	$	5,356	$	(5,331	)	$	(25	)	$	– 0	–	$	– 0	–
Total	$	5,356	$	(5,331	)	$	(25	)	$	– 0	–	$	– 0	–
OTC Derivatives:
Bank of America, N.A.	$	11,329	$	(6,997	)	$	– 0	–	$	– 0	–	$	4,332
Barclays Bank PLC		276		(276	)		– 0	–		– 0	–		– 0	–
Brown Brothers Harriman & Co.		2,697		(2,484	)		– 0	–		– 0	–		213
Citibank, N.A.		4,107		– 0	–		– 0	–		– 0	–		4,107
Credit Suisse International		812		(812	)		– 0	–		– 0	–		– 0	–
Deutsche Bank AG		911		(911	)		– 0	–		– 0	–		– 0	–

68 •  AB HIGH YIELD PORTFOLIO

Notes to Financial Statements

Counterparty	Derivative Liabilities Subject to a MA		Derivatives Available for Offset			Cash Collateral Pledged			Security Collateral Pledged			Net Amount of  Derivatives Liabilities
Goldman Sachs Bank USA / Goldman Sachs International	$	5,100	$	(5,100	)	$	– 0	–	$	– 0	–	$	– 0	–
Morgan Stanley & Co. International PLC		17,183		(12,150	)		– 0	–		– 0	–		5,033
Royal Bank of Scotland PLC		1,787		– 0	–		– 0	–		– 0	–		1,787
Standard Chartered Bank		2,006		(410	)		– 0	–		– 0	–		1,596
Total	$	46,208	$	(29,140	)	$	– 0	–	$	– 0	–	$	17,068	^

* Cash has been posted for initial margin requirements on exchange-traded derivatives outstanding at October 31, 2015.

^ Net amount represents the net receivable/payable that would be due from/to the counterparty in the event of default or termination. The net amount from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same counterparty.

2. Currency Transactions

The Portfolio may invest in non-U.S. dollar securities on a currency hedged or unhedged basis. The Portfolio may seek investment opportunities by taking long or short positions in currencies through the use of currency-related derivatives, including forward currency exchange contracts, futures and options on futures, swaps, and other options. The Portfolio may enter into transactions for investment opportunities when it anticipates that a foreign currency will appreciate or depreciate in value but securities denominated in that currency are not held by the Portfolio and do not present attractive investment opportunities. Such transactions may also be used when the Adviser believes that it may be more efficient than a direct investment in a foreign currency-denominated security. The Portfolio may also conduct currency exchange contracts on a spot basis (i.e., for cash at the spot rate prevailing in the currency exchange market for buying or selling currencies).

3. Loan Participations and Assignments

The Portfolio may invest in direct debt instruments which are interests in amounts owed to lenders or lending syndicates by corporate, governmental, or other borrowers, either in the form of participations at the time the loan is originated (“Participations”) or by buying an interest in the loan in the secondary market from a financial institution or institutional investor (“Assignments”). A loan is often administered by a bank or other financial institution (the “Lender”) that acts as agent for all holders. The agent administers the terms of the loan as specified in the loan agreement. When investing in Participations, the Portfolio generally has no right to enforce compliance with the terms of the loan agreement with the borrower. In addition, when investing in Participations, the Portfolio has the right to receive payments of principal, interest and any fees to which it is entitled only from the Lender and only upon

AB HIGH YIELD PORTFOLIO  • 69

Notes to Financial Statements

receipt of payments by the Lender from the borrower. As a result, the Portfolio may be subject to the credit risk of both the borrower and the Lender. When the Portfolio purchases Assignments from Lenders, it will typically acquire direct rights against the borrower on the loan. These loans may include participations in “bridge loans”, which are loans taken out by borrowers for a short period (typically less than six months) pending arrangement of more permanent financing through, for example, the issuance of bonds, frequently high-yield bonds issued for the purpose of acquisitions. The Portfolio may also participate in unfunded loan commitments, which are contractual obligations for investing in future Participations, and may receive a commitment fee based on the amount of the commitment. Under these arrangements, the Portfolio may receive a fixed rate commitment fee and, if and to the extent the borrower borrows under the facility, the Portfolio may receive an additional funding fee.

Unfunded loan commitments and funded loans are marked to market daily.

As of October 31, 2015, the Portfolio had no unfunded loan commitments or bridge loan commitments outstanding.

During the year ended October 31, 2015, the Portfolio received no commitment fees or additional funding fees.

NOTE E

Capital Stock

Each class consists of 3,000,000,000 authorized shares. Transactions in capital shares for each class were as follows:

	Shares						Amount
	Year Ended October 31, 2015			July 15, 2014* to October 31, 2014			Year Ended October 31, 2015			July 15, 2014* to October 31, 2014
Class A
Shares sold		292,676			2,929		$	2,741,466		$	29,153
Shares issued in reinvestment of dividends and distributions		2,211			10			20,519			102
Shares redeemed		(979	)		– 0	–		(9,038	)		– 0	–
Net increase		293,908			2,939		$	2,752,947		$	29,255
Class C
Shares sold		14,010			1,000		$	135,980		$	10,002
Shares issued in reinvestment of dividends and distributions		334			– 0	–		3,193			– 0	–
Shares redeemed		(2,449	)		– 0	–		(23,449	)		– 0	–
Net increase		11,895			1,000		$	115,724		$	10,002

70 •  AB HIGH YIELD PORTFOLIO

Notes to Financial Statements

	Shares						Amount
	Year Ended October 31, 2015			July 15, 2014* to October 31, 2014			Year Ended October 31, 2015			July 15, 2014* to October 31, 2014
Advisor Class
Shares sold		12,660			13,778		$	117,525		$	136,502
Shares issued in reinvestment of dividends and distributions		694			13			6,625			124
Net increase		13,354			13,791		$	124,150		$	136,626
Class R
Shares sold		– 0	–		1,000		$	– 0	–	$	10,002
Net increase		– 0	–		1,000		$	– 0	–	$	10,002
Class K
Shares sold		– 0	–		1,000		$	– 0	–	$	10,002
Net increase		– 0	–		1,000		$	– 0	–	$	10,002
Class I
Shares sold		– 0	–		1,994,000		$	– 0	–	$	19,940,002
Shares redeemed		(203,669	)		– 0	–		(2,000,000	)		– 0	–
Net increase (decrease)		(203,669	)		1,994,000		$	(2,000,000	)	$	19,940,002
Class Z
Shares sold		– 0	–		1,000		$	– 0	–	$	10,002
Net increase		– 0	–		1,000		$	– 0	–	$	10,002

* Commencement of operations.

At October 31, 2015, the Adviser owns approximately 84% of the Portfolio’s outstanding shares.

NOTE F

Risks Involved in Investing in the Portfolio

Interest Rate Risk and Credit Risk—Interest rate risk is the risk that changes in interest rates will affect the value of the Portfolio’s investments in fixed-income debt securities such as bonds or notes. Increases in interest rates may cause the value of the Portfolio’s investments to decline. Credit risk is the risk that the issuer or guarantor of a debt security, or the counterparty to a derivative contract, will be unable or unwilling to make timely principal and/or interest payments, or to otherwise honor its obligations. The degree of risk for a particular security may be reflected in its credit rating. Credit risk is greater for medium quality and lower-rated securities. Lower-rated debt securities and similar unrated securities (commonly known as “junk bonds”) have speculative elements or are predominantly speculative risks.

Below Investment Grade Securities Risk—Investments in fixed-income securities with lower ratings are subject to a higher probability that an issuer will default or

AB HIGH YIELD PORTFOLIO  • 71

Notes to Financial Statements

fail to meet its payment obligations. These securities may be subject to greater price volatility, due to such factors as specific corporate developments, negative perception of the junk bond market generally and less secondary market liquidity. These securities are often able to be “called” or repurchased by the issuer prior to their maturity date, forcing the Portfolio to reinvest the proceeds, possibly at a lower rate of return.

Inflation Risk—This is the risk that the value of assets or income from investments will be less in the future as inflation decreases the value of money. As inflation increases, the value of the Portfolio’s assets can decline as can the value of the Portfolio’s distributions. This risk is significantly greater if the Portfolio invests a significant portion of its assets in fixed-income securities with longer maturities.

Derivatives Risk—The Portfolio may enter into derivative transactions such as forwards, options, futures and swaps. Derivatives may be illiquid, difficult to price, and leveraged so that small changes may produce disproportionate losses for the Portfolio, and subject to counterparty risk to a greater degree than more traditional investments. Derivatives may result in significant losses, including losses that are far greater than the value of the derivatives reflected on the statement of assets and liabilities.

Leverage Risk—When the Portfolio borrows money or otherwise leverages its investments, its performance may be volatile because leverage tends to exaggerate the effect of any increase or decrease in the value of the Portfolio’s investments. The Portfolio may create leverage through the use of reverse repurchase arrangements, forward currency exchange contracts, forward commitments, dollar rolls or futures contracts or by borrowing money. The use of derivative instruments by the Portfolio, such as forwards, futures, options and swaps, may also result in a form of leverage. Leverage may result in higher returns to the Portfolio than if the Portfolio were not leveraged, but may also adversely affect returns, particularly if the market is declining.

Foreign (Non-U.S.) Risk—Investments in securities of non-U.S. issuers may involve more risk than those of U.S. issuers. These securities may fluctuate more widely in price and may be less liquid due to adverse market, economic, political, regulatory or other factors. These risks may be heightened with respect to investments in emerging-market countries, where there may be an increased amount of economic, political and social instability.

Emerging Market Risk—Investments in emerging market countries may have more risk because the markets are less developed and less liquid as well as being subject to increased economic, political, regulatory or other uncertainties.

Currency Risk—Fluctuations in currency exchange rates may negatively affect the value of the Portfolio’s investments or reduce its returns.

72 •  AB HIGH YIELD PORTFOLIO

Notes to Financial Statements

Diversification Risk—The Portfolio may have more risk because it is “non-diversified”, meaning that it can invest more of its assets in a smaller number of issuers. Accordingly, changes in the value of a single security may have a more significant effect, either negative or positive, on the Portfolio’s NAV.

Liquidity Risk—Liquidity risk occurs when certain investments become difficult to purchase or sell. Difficulty in selling less liquid securities may result in sales at disadvantageous prices affecting the value of your investment in the Portfolio. Causes of liquidity risk may include low trading volumes, large positions and heavy redemptions of fixed-income mutual fund shares. Over recent years, liquidity risk has also increased because the capacity of dealers in the secondary market for fixed-income securities to make markets in these securities has decreased, even as the overall bond market has grown significantly, due to, among other things, structural changes, additional regulatory requirements and capital and risk restraints that have led to reduced inventories. Liquidity risk may be higher in a rising interest rate environment, when the value and liquidity of fixed-income securities generally go down.

Indemnification Risk—In the ordinary course of business, the Portfolio enters into contracts that contain a variety of indemnifications. The Portfolio’s maximum exposure under these arrangements is unknown. However, the Portfolio has not had prior claims or losses pursuant to these indemnification provisions and expects the risk of loss thereunder to be remote. Therefore, the Portfolio has not accrued any liability in connection with these indemnification provisions.

NOTE G

Joint Credit Facility

A number of open-end mutual funds managed by the Adviser, including the Portfolio, participate in a $280 million revolving credit facility (the “Facility”) intended to provide short-term financing if necessary, subject to certain restrictions, in connection with abnormal redemption activity. Commitment fees related to the Facility are paid by the participating funds and are included in miscellaneous expenses in the statement of operations. The Portfolio did not utilize the Facility during the year ended October 31, 2015.

NOTE H

Distributions to Shareholders

The tax character of distributions paid during the fiscal years ended October 31, 2015 and October 31, 2014 were as follows:

	2015			2014
Distributions paid from:
Ordinary income	$	903,701		$	203,832
Long-term capital gains		– 0	–		– 0	–
Total taxable distributions paid	$	903,701		$	203,832

AB HIGH YIELD PORTFOLIO  • 73

Notes to Financial Statements

As of October 31, 2015, the components of accumulated earnings/(deficit) on a tax basis were as follows:

Undistributed ordinary income	$	218,630
Accumulated capital and other losses		(451,121	)(a)
Unrealized appreciation/(depreciation)		(1,122,523	)(b)
Total accumulated earnings/(deficit)	$	(1,355,014	)(c)

^(a)  As of October 31, 2015, the Portfolio had a net capital loss carryforward of $451,121.

^(b) The differences between book-basis and tax-basis unrealized appreciation/(depreciation) are attributable primarily to the tax deferral of losses on wash sales, the tax treatment of swaps, and the realization for tax purposes of gains/losses on certain derivative instruments.

^(c)  The differences between book-basis and tax-basis components of accumulated earnings/(deficit) is attributable primarily to the tax treatment of interest on defaulted securities and dividends payable.

For tax purposes, net capital losses may be carried over to offset future capital gains, if any. Funds are permitted to carry forward capital losses incurred in taxable years beginning after December 22, 2010 for an indefinite period, and such losses will retain their character as either short-term or long-term capital losses. As of October 31, 2015, the Portfolio had a net short-term capital loss carryforward of $353,432 and a net long-term capital loss carryforward of $97,689 which may be carried forward for an indefinite period.

During the current year, permanent differences primarily due to foreign currency reclassfications, the tax treatment of swaps, options, and futures, reclassifications of paydown gains/losses, the redesignation of dividends and the tax treatment of offering costs resulted in a net decrease in distributions in excess of net investment income, a net increase in accumulated net realized loss on investment and foreign currency transactions, and a net decrease in additional paid-in capital. These reclassifications had no affect on net assets.

NOTE I

New Accounting Pronouncement

In May 2015, the Financial Accounting Standards Board issued an Accounting Standards Update (“ASU”), ASU 2015-07, which removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the net asset value per share practical expedient. The ASU also removes the disclosure requirement for investments not valued at net asset value. The ASU is effective for annual periods beginning after December 15, 2015 and interim periods within those annual periods. At this time, management is evaluating the implications of these changes on the financial statements.

NOTE J

Subsequent Events

Management has evaluated subsequent events for possible recognition or disclosure in the financial statements through the date the financial statements are issued. Management has determined that there are no material events that would require disclosure in the Portfolio’s financial statements through this date.

74 •  AB HIGH YIELD PORTFOLIO

Notes to Financial Statements

FINANCIAL HIGHLIGHTS

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class A
	Year Ended October 31, 2015			July 15, 2014(a) to October 31, 2014
Net asset value, beginning of period		$  9.91			$  10.00
Income From Investment Operations
Net investment income(b)(c)		.38			.10
Net realized and unrealized loss on investment and foreign currency transactions		(.59	)		(.10	)
Net increase (decrease) in net asset value from operations		(.21	)		.00
Less: Dividends and Distributions
Dividends from net investment income		(.45	)		(.09	)
Distributions from net realized gain on investment and foreign currency transactions		(.01	)		– 0	–
Total dividends and distributions		(.46	)		(.09	)
Net asset value, end of period		$  9.24			$  9.91
Total Return
Total investment return based on net asset value(d)		(2.19	)%		0.04	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$2,742			$29
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		1.05	%		1.05	%(e)
Expenses, before waivers/reimbursements		6.57	%		49.84	%(e)
Net investment income(c)		4.11	%		3.41	%(e)
Portfolio turnover rate		56	%		5	%

See footnote summary on page 81.

AB HIGH YIELD PORTFOLIO  • 75

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class C
	Year Ended October 31, 2015			July 15, 2014(a) to October 31, 2014
Net asset value, beginning of period		$  9.91			$  10.00
Income From Investment Operations
Net investment income(b)(c)		.32			.07
Net realized and unrealized loss on investment and foreign currency transactions		(.61	)		(.09	)
Net decrease in net asset value from operations		(.29	)		(.02	)
Less: Dividends and Distributions
Dividends from net investment income		(.37	)		(.07	)
Distributions from net realized gain on investment and foreign currency transactions		(.01	)		– 0	–
Total dividends and distributions		(.38	)		(.07	)
Net asset value, end of period		$  9.24			$  9.91
Total Return
Total investment return based on net asset value(d)		(2.95	)%		(0.18	)%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$119			$10
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		1.80	%		1.80	%(e)
Expenses, before waivers/reimbursements		7.85	%		56.89	%(e)
Net investment income(c)		3.36	%		2.28	%(e)
Portfolio turnover rate		56	%		5	%

See footnote summary on page 81.

76 •  AB HIGH YIELD PORTFOLIO

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Advisor Class
	Year Ended October 31, 2015			July 15, 2014(a) to October 31, 2014
Net asset value, beginning of period		$  9.91			$  10.00
Income From Investment Operations
Net investment income(b)(c)		.42			.10
Net realized and unrealized loss on investment and foreign currency transactions		(.61	)		(.09	)
Net increase (decrease) in net asset value from operations		(.19	)		.01
Less: Dividends and Distributions
Dividends from net investment income		(.47	)		(.10	)
Distributions from net realized gain on investment and foreign currency transactions		(.01	)		– 0	–
Total dividends and distributions		(.48	)		(.10	)
Net asset value, end of period		$  9.24			$    9.91
Total Return
Total investment return based on net asset value(d)		(1.94	)%		0.14	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$251			$137
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.80	%		.80	%(e)
Expenses, before waivers/reimbursements		7.35	%		33.51	%(e)
Net investment income(c)		4.38	%		3.26	%(e)
Portfolio turnover rate		56	%		5	%

See footnote summary on page 81.

AB HIGH YIELD PORTFOLIO  • 77

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class R
	Year Ended October 31, 2015			July 15, 2014(a) to October 31, 2014
Net asset value, beginning of period		$  9.91			$  10.00
Income From Investment Operations
Net investment income(b)(c)		.37			.08
Net realized and unrealized loss on investment and foreign currency transactions		(.60	)		(.08	)
Net increase (decrease) in net asset value from operations		(.23	)		.00
Less: Dividends and Distributions
Dividends from net investment income		(.43	)		(.09	)
Distributions from net realized gain on investment and foreign currency transactions		(.01	)		– 0	–
Total dividends and distributions		(.44	)		(.09	)
Net asset value, end of period		$  9.24			$    9.91
Total Return
Total investment return based on net asset value(d)		(2.42	)%		(0.03	)%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$9			$10
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		1.30	%		1.30	%(e)
Expenses, before waivers/reimbursements		4.39	%		4.84	%(e)
Net investment income(c)		3.90	%		2.78	%(e)
Portfolio turnover rate		56	%		5	%

See footnote summary on page 81.

78 •  AB HIGH YIELD PORTFOLIO

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class K
	Year Ended October 31, 2015			July 15, 2014(a) to October 31, 2014
Net asset value, beginning of period		$  9.91			$  10.00
Income From Investment Operations
Net investment income(b)(c)		.40			.09
Net realized and unrealized loss on investment and foreign currency transactions		(.61	)		(.09	)
Net increase (decrease) in net asset value from operations		(.21	)		.00
Less: Dividends and Distributions
Dividends from net investment income		(.45	)		(.09	)
Distributions from net realized gain on investment and foreign currency transactions		(.01	)		– 0	–
Total dividends and distributions		(.46	)		(.09	)
Net asset value, end of period		$  9.24			$    9.91
Total Return
Total investment return based on net asset value(d)		(2.17	)%		0.05	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$9			$10
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		1.05	%		1.05	%(e)
Expenses, before waivers/reimbursements		4.13	%		4.56	%(e)
Net investment income(c)		4.15	%		3.03	%(e)
Portfolio turnover rate		56	%		5	%

See footnote summary on page 81.

AB HIGH YIELD PORTFOLIO  • 79

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class I
	Year Ended October 31, 2015			July 15, 2014(a) to October 31, 2014
Net asset value, beginning of period		$  9.91			$  10.00
Income From Investment Operations
Net investment income(b)(c)		.42			.10
Net realized and unrealized loss on investment and foreign currency transactions		(.61	)		(.09	)
Net increase (decrease) in net asset value from operations		(.19	)		.01
Less: Dividends and Distributions
Dividends from net investment income		(.47	)		(.10	)
Distributions from net realized gain on investment and foreign currency transactions		(.01	)		– 0	–
Total dividends and distributions		(.48	)		(.10	)
Net asset value, end of period		$  9.24			$    9.91
Total Return
Total investment return based on net asset value(d)		(1.94	)%		0.12	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$16,544			$19,757
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.80	%		.80	%(e)
Expenses, before waivers/reimbursements		3.86	%		4.27	%(e)
Net investment income(c)		4.39	%		3.29	%(e)
Portfolio turnover rate		56	%		5	%

See footnote summary on page 81.

80 •  AB HIGH YIELD PORTFOLIO

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class Z
	Year Ended October 31, 2015			July 15, 2014(a) to October 31, 2014
Net asset value, beginning of period		$  9.91			$  10.00
Income From Investment Operations
Net investment income(b)(c)		.42			.10
Net realized and unrealized loss on investment and foreign currency transactions		(.61	)		(.09	)
Net increase (decrease) in net asset value from operations		(.19	)		.01
Less: Dividends and Distributions
Dividends from net investment income		(.47	)		(.10	)
Distributions from net realized gain on investment and foreign currency transactions		(.01	)		– 0	–
Total dividends and distributions		(.48	)		(.10	)
Net asset value, end of period		$  9.24			$    9.91
Total Return
Total investment return based on net asset value(d)		(1.93	)%		0.12	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$9			$10
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.80	%		.80	%(e)
Expenses, before waivers/reimbursements		3.86	%		4.30	%(e)
Net investment income(c)		4.40	%		3.28	%(e)
Portfolio turnover rate		56	%		5	%

(a) Commencement of operations.

(b) Based on average shares outstanding.

(c) Net of expenses waived/reimbursed by the Adviser.

(d) Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Initial sales charges or contingent deferred sales charges are not reflected in the calculation of total investment return. Total return does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Total investment return calculated for a period of less than one year is not annualized.

(e) Annualized.

See notes to financial statements.

AB HIGH YIELD PORTFOLIO  • 81

Financial Highlights

REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

To the Board of Directors of AB Bond Fund, Inc. and Shareholders of AB High Yield Portfolio

We have audited the accompanying statement of assets and liabilities, including the portfolio of investments, of AB High Yield Portfolio (the “Fund”) (formerly known as AllianceBernstein High Yield Portfolio), one of the portfolios constituting AB Bond Fund, Inc. (formerly known as AllianceBernstein Bond Fund, Inc.), as of October 31, 2015, and the related statement of operations for the year then ended, and the statements of changes in net assets and financial highlights for the year then ended and for the period July 15, 2014 (commencement of operations) to October 31, 2014. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Fund’s internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of October 31, 2015, by correspondence with the custodian and others or by other appropriate auditing procedures where replies from others were not received. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of AB High Yield Portfolio (one of the portfolios constituting AB Bond Fund, Inc.) at October 31, 2015, the results of its operations for the year then ended, and the changes in its net assets and financial highlights for the year then ended and for the period July 15, 2014 (commencement of operations) to October 31, 2014 in conformity with U.S. generally accepted accounting principles.

New York, New York

December 30, 2015

82 •  AB HIGH YIELD PORTFOLIO

Report of Independent Registered Public Accounting Firm

2015 FEDERAL TAX INFORMATION

(unaudited)

For Federal income tax purposes, the following information is furnished with respect to the distributions paid by the Portfolio during the taxable year ended October 31, 2015. For foreign shareholders, 66.37% of ordinary dividends paid may be considered to be qualifying to be taxed as interest-related dividends.

Shareholders should not use the above information to prepare their income tax returns. The information necessary to complete your income tax returns will be included with your Form 1099-DIV which will be sent to you separately in January 2016.

AB HIGH YIELD PORTFOLIO  • 83

BOARD OF DIRECTORS

Marshall C. Turner, Jr.⁽¹⁾ , Chairman John H. Dobkin⁽¹⁾ Michael J. Downey⁽¹⁾ William H. Foulk, Jr.⁽¹⁾ D. James Guzy⁽¹⁾ Nancy P. Jacklin⁽¹⁾ Robert M. Keith, President and Chief Executive Officer Garry L. Moody⁽¹⁾ Earl D. Weiner⁽¹⁾

OFFICERS

Philip L. Kirstein, Senior Vice President and Independent Compliance Officer Gershon M. Distenfeld⁽²⁾, Vice President Sherif M. Hamid⁽²⁾, Vice President Ivan Rudolph-Shabinsky⁽²⁾, Vice President Ashish C. Shah⁽²⁾, Vice President Joseph J. Mantineo, Treasurer and Chief Financial Officer Emilie D. Wrapp, Secretary Phyllis J. Clarke, Controller Vincent S. Noto, Chief Compliance Officer

Custodian and Accounting Agent Brown Brothers Harriman & Co. 50 Post Office Square Boston, MA 02110   Principal Underwriter AllianceBernstein Investments, Inc. 1345 Avenue of the Americas New York, NY 10105   Transfer Agent AllianceBernstein Investor Services, Inc. P.O. Box 786003 San Antonio, TX 78278-6003 Toll-Free (800) 221-5672 Independent Registered Public Accounting Firm Ernst & Young LLP 5 Times Square New York, NY 10036   Legal Counsel Seward & Kissel LLP One Battery Park Plaza New York, NY 10004

(1) Member of the Audit Committee, the Governance and Nominating Committee and the Independent Directors Committee.

(2) The day-to-day management of, and investment decisions for, the Fund are made by the High Yield Investment Team. Messrs. Distenfeld, Hamid, Rudolph-Shabinksy and Shah are the investment professionals with the most significant responsibility for the day-to-day management of the Fund’s portfolio.

84 •  AB HIGH YIELD PORTFOLIO

Board of Directors

MANAGEMENT OF THE FUND

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIP CURRENTLY HELD BY DIRECTOR
INTERESTED DIRECTOR
Robert M. Keith, + 1345 Avenue of the Americas New York, NY 10105 55 (2014)	Senior Vice President of AllianceBernstein L.P. (the “Adviser”) and the head of AllianceBernstein Investments, Inc. (“ABI”) since July 2008; Director of ABI and President of the AB Mutual Funds. Previously, he served as Executive Managing Director of ABI from December 2006 to June 2008. Prior to joining ABI in 2006, Executive Managing Director of Bernstein Global Wealth Management, and prior thereto, Senior Managing Director and Global Head of Client Service and Sales of the Adviser’s institutional investment management business since 2004. Prior thereto, he was Managing Director and Head of North American Client Service and Sales in the Adviser’s institutional investment management business, with which he had been associated since prior to 2004.		110	None

AB HIGH YIELD PORTFOLIO  • 85

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIP CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS
Marshall C. Turner, Jr.# Chairman of the Board 74 (2014)	Private Investor since prior to 2010. Former Chairman and CEO of Dupont Photomasks, Inc. (components of semi-conductor manufacturing). He has extensive operating leadership and venture capital investing experience, including five interim or full-time CEO roles, and prior service as general partner of institutional venture capital partnerships. He also has extensive non-profit board leadership experience, and currently serves on the boards of two education and science-related non-profit organizations. He has served as a director of one AB fund since 1992, and director or trustee of multiple AB Funds since 2005. He has been Chairman of the AB Funds since January 2014, and the Chairman of the Independent Directors Committees of such Funds since February 2014.		110	Xilinx, Inc. (programmable logic semi- conductors) since 2007
John H. Dobkin, # 73 (2014)	Independent Consultant since prior to 2010. Formerly, President of Save Venice, Inc. (preservation organization) from 2001–2002; Senior Advisor from June 1999-June 2000 and President of Historic Hudson Valley (historic preservation) from December 1989-May 1999. Previously, Director of the National Academy of Design. He has served as a director or trustee of various AB Funds since 1992, and as Chairman of the Audit Committees of a number of such Funds from 2001-2008.		110	None

86 •  AB HIGH YIELD PORTFOLIO

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIP CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
Michael J. Downey, # 71 (2014)	Private Investor since prior to 2009. Formerly, managing partner of Lexington Capital, LLC (investment advisory firm) from December 1997 until December 2003. He was a Director of The Merger Fund (registered investment company) since prior to 2010 until 2013 and Prospect Acquisition Corp. (financial services) from 2007 until 2009. From 1987 until 1993, Chairman and CEO of Prudential Mutual Fund Management, director of the Prudential mutual funds, and member of the Executive Committee of Prudential Securities Inc. He has served as a director or trustee of the AB Funds since 2005 and is a director and Chairman of one other registered investment company.		110	Asia Pacific Fund, Inc. (registered investment company) since prior to 2010
William H. Foulk, Jr., # 83 (2014)	Investment Adviser and an Independent Consultant since prior to 2010. Previously, he was Senior Manager of Barrett Associates, Inc., a registered investment adviser. He was formerly Deputy Comptroller and Chief Investment Officer of the State of New York and, prior thereto, Chief Investment Officer of the New York Bank for Savings. He has served as a director or trustee of various AB Funds since 1983, and was Chairman of the Independent Directors Committees of the AB Funds from 2003 until early February 2014. He served as Chairman of such Funds from 2003 through December 2013. He is also active in a number of mutual fund related organizations and committees.		110	None

AB HIGH YIELD PORTFOLIO  • 87

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIP CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
D. James Guzy, # 79 (2014)	Chairman of the Board of SRC Computers, Inc. (semi-conductors), with which he has been associated since prior to 2010. He served as Chairman of the Board of PLX Technology (semi-conductors) since prior to 2010 until November 2013. He was a Director of Cirrus Logic Corporation (semi-conductors) from 1984 until July 2011. He was a director of Intel Corporation (semi-conductors) from 1969 until 2008, and served as Chairman of the Finance Committee of such company for several years until May 2008. He has served as a director or trustee of one or more of the AB Funds since 1982.		110
Nancy P. Jacklin, # 67 (2014)	Professorial Lecturer at the Johns Hopkins School of Advanced International Studies (2008-2015). U.S. Executive Director of the International Monetary Fund (which is responsible for ensuring the stability of the international monetary system), (December 2002-May 2006); Partner, Clifford Chance (1992-2002); Sector Counsel, International Banking and Finance, and Associate General Counsel, Citicorp (1985-1992); Assistant General Counsel (International), Federal Reserve Board of Governors (1982-1985); and Attorney Advisor, U.S. Department of the Treasury (1973-1982). Member of the Bar of the District of Columbia and of New York; and member of the Council on Foreign Relations. She has served as a director or trustee of the AB Funds since 2006 and has been Chairman of the Governance and Nominating Committees of the Funds since August 2014.		110	None

88 •  AB HIGH YIELD PORTFOLIO

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIP CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
Garry L. Moody, # 63 (2014)	Independent Consultant. Formerly, Partner, Deloitte & Touche LLP (1995-2008) where he held a number of senior positions, including Vice Chairman, and U.S. and Global Investment Management Practice Managing Partner; President, Fidelity Accounting and Custody Services Company (1993-1995); and Partner, Ernst & Young LLP (1975-1993), where he served as the National Director of Mutual Fund Tax Services and Managing Partner of its Chicago Office Tax department. He is a member of the Trustee Advisory Board of BoardIQ, a biweekly publication focused on issues and news affecting directors of mutual funds. He has served as a director or trustee, and as Chairman of the Audit Committees, of the AB Funds since 2008.		110	None
Earl D. Weiner, # 76 (2014)	Of Counsel, and Partner prior to January 2007, of the law firm Sullivan & Cromwell LLP and is a former member of the ABA Federal Regulation of Securities Committee Task Force to draft editions of the Fund Director’s Guidebook. He also serves as a director or trustee of various non-profit organizations and has served as Chairman or Vice Chairman of a number of them. He has served as a director or trustee of the AB Funds since 2007 and served as Chairman of the Governance and Nominating Committees of the AB Funds from 2007 until August 2014.		110	None

AB HIGH YIELD PORTFOLIO  • 89

Management of the Fund

* The address for each of the Fund’s disinterested Directors is c/o AllianceBernstein L.P., Attention: Philip L. Kirstein, 1345 Avenue of the Americas, New York, NY 10105.

** There is no stated term of office for the Fund’s Directors.

*** The information above includes each Director’s principal occupation during the last five years and other information relating to the experience, attributes and skills relevant to each Director’s qualifications to serve as a Director, which led to the conclusion that each Director should serve as a Director for the Fund.

+ Mr. Keith is an “interested person” of the Portfolio as defined in the Investment Company Act of 1940, due to his position as a Senior Vice President of the Adviser.

# Member of the Audit Committee, the Governance and Nominating Committee and the Independent Directors Committee.

90 •  AB HIGH YIELD PORTFOLIO

Management of the Fund

Officer Information

Certain information concerning the Fund’s Officers is listed below.

NAME, ADDRESS*, AND AGE	POSITION(S) HELD WITH FUND	PRINCIPAL OCCUPATION DURING PAST 5 YEARS
Robert M. Keith 55	President and Chief Executive Officer	See biography above.
Philip L. Kirstein 70	Senior Vice President and Independent Compliance Officer	Senior Vice President and Independent Compliance Officer of the AB Funds, with which he has been associated since October 2004. Prior thereto, he was Of Counsel to Kirkpatrick & Lockhart, LLP from October 2003 to October 2004, and General Counsel of Merrill Lynch Investment Managers, L.P. since prior to March 2003.
Gershon M. Distenfeld 39	Vice President	Senior Vice President of the Adviser**, with which he has been associated since prior to 2010.
Sherif M. Hamid 39	Vice President	Senior Vice President of the Adviser, with which he has been associated since 2013 and Portfolio Manager for High Yield. Previously, he was head of European Credit Strategy of Barclays Capital 2011 to 2013, and a U.S. investment-grade credit strategist and U.S. high yield analyst since prior to 2010.
Ivan Rudolph-Shabinsky 51	Vice President	Senior Vice President of the Adviser**, with which he has been associated since prior to 2010.
Ashish C. Shah 45	Vice President	Senior Vice President, and Head of Global Credit of the Adviser**, with which he has been associated since May 2010 and Chief Diversity Officer since 2014. Previously he was a Managing Director and Head of Global Credit Strategy at Barclays Capital since prior to 2010.
Emilie D. Wrapp 59	Secretary	Senior Vice President, Assistant General Counsel and Assistant Secretary of ABI**, with which she has been associated since prior to 2010.
Joseph J. Mantineo 56	Treasurer and Chief Financial Officer	Senior Vice President of ABIS**, with which he has been associated since prior to 2010.
Vincent S. Noto 50	Chief Compliance Officer	Senior Vice President since 2015 and Mutual Fund Chief Compliance Officer of the Adviser** since 2014. Prior thereto, he was Vice President and Director of Mutual Fund Compliance of the Adviser** since prior to 2010.
Phyllis J. Clarke 54	Controller	Vice President of ABIS**, with which she has been associated since prior to 2010.

AB HIGH YIELD PORTFOLIO  • 91

Management of the Fund

* The address for each of the Fund’s Officers is 1345 Avenue of the Americas, New York, NY 10105.

** The Adviser, ABI and ABIS are affiliates of the Fund.

The Fund’s Statement of Additional Information (“SAI”) has additional information about the Fund’s Directors and Officers and is available without charge upon request. Contact your financial representative or AB at 1-(800) 227-4618, or visit www.ABglobal.com, for a free prospectus or SAI.

92 •  AB HIGH YIELD PORTFOLIO

Management of the Fund

THE FOLLOWING IS NOT PART OF THE SHAREHOLDER REPORT OR THE FINANCIAL STATEMENTS

SUMMARY OF SENIOR OFFICER’S EVALUATION OF INVESTMENT ADVISORY AGREEMENT¹

The following is a summary of the evaluation of the Investment Advisory Agreement between AllianceBernstein L.P. (the “Adviser”) and AB Bond Fund, Inc. (the “Fund”) in respect of AB High Yield Portfolio (the “Portfolio”),² prepared by Philip L. Kirstein, the Senior Officer of the Fund for the Directors of the Fund, as required by the August 2004 agreement between the Adviser and the New York State Attorney General (the “NYAG”). The Senior Officer’s evaluation of the Investment Advisory Agreement is not meant to diminish the responsibility or authority of the Board of Directors of the Fund to perform its duties pursuant to Section 15 of the Investment Company Act of 1940 (the “40 Act”) and applicable state law. The purpose of the summary is to provide shareholders with a synopsis of the independent evaluation of the reasonableness of the advisory fees proposed to be paid by the Portfolio which was provided to the Directors in connection with their review of the proposed approval of the continuance of the Investment Advisory Agreement.

The Senior Officer’s evaluation considered the following factors:

1. Advisory fees charged to institutional and other clients of the Adviser for like services;

2. Advisory fees charged by other mutual fund companies for like services;

3. Costs to the Adviser and its affiliates of supplying services pursuant to the advisory agreement, excluding any intra-corporate profit;

4. Profit margins of the Adviser and its affiliates from supplying such services;

5. Possible economies of scale as the Portfolio grows larger; and

6. Nature and quality of the Adviser’s services including the performance of the Portfolio.

These factors, with the exception of the first factor, are generally referred to as the “Gartenberg factors,” which were articulated by the United States Court of Appeals for the Second Circuit in 1982. Gartenberg v. Merrill Lynch Asset Management, Inc., 694 F. 2d 923 (2d Cir. 1982). On March 30, 2010, the Supreme Court held the Gartenberg decision was correct in its basic formulation of what Section 36(b) requires: to face liability under Section 36(b), “an investment adviser must charge a fee that is so disproportionately large that it bears no

1 The information in the fee evaluation was completed on October 22, 2015 and discussed with the Board of Directors on November 3-5, 2015.

2 Future references to the Portfolio do not include “AB.” References in the fee summary pertaining to performance and expense ratios refer to the Class A shares of the Portfolio.

AB HIGH YIELD PORTFOLIO  • 93

reasonable relationship to the services rendered and could not have been the product of arm’s length bargaining.”Jones v. Harris Associates L.P., 130 S. Ct. 1418 (2010). In the Jones decision, the Court stated the Gartenberg approach fully incorporates the correct understanding of fiduciary duty within the context of Section 36(b) and noted with approval that “Gartenberg insists that all relevant circumstances be taken into account” and “uses the range of fees that might result from arm’s length bargaining as the benchmark for reviewing challenged fees.”³

INVESTMENT ADVISORY FEES, NET ASSETS, & EXPENSE RATIOS

The Adviser proposed that the Portfolio pays the advisory fee set forth below for receiving the services to be provided pursuant to the Investment Advisory Agreement. Also shown are the Portfolio’s net assets on September 30, 2015.

Portfolio	Net Assets 9/30/15 ($MM)	Advisory Fee
High Yield Portfolio4,5	$18.9	0.60% on 1st $2.5 billion
		0.55% on next $2.5 billion
		0.50% on the balance

The Portfolio’s Investment Advisory Agreement provides for the Adviser to be reimbursed for certain clerical, legal, accounting, administrative and other services provided to the Fund. During the Portfolio’s fiscal year ended October 31, 2014, the Adviser received $19,919 (0.100% of the Portfolio’s average daily net assets) for providing such services but waived the amount in its entirety.

The Adviser has agreed to waive that portion of its management fees and/or reimburse the Portfolio for that portion of the Portfolio’s total operating expenses to the degree necessary to limit the Portfolio’s expense ratio to the amounts set forth below for the Portfolio’s current fiscal year. The waiver is terminable by the Adviser at the end of the Portfolio’s fiscal year upon at least

3 Jones v. Harris at 1427.

4 The advisory fee schedule for the Portfolio has a higher effective fee rate than the advisory fee schedule of the High Income category, in which the Portfolio would have been categorized, had the Adviser proposed to implement the NYAG related fee schedule. The advisory fee schedule of the High Income category is as follows: 50 bp on the first $2.5 billion, 45 bp on the next $2.5 billion, and 40 bp on the balance.

5 The Adviser manages AB High Income Fund, Inc. (“High Income Fund, Inc.”). Prior to January 25, 2008, the High Income Fund, Inc. had an emerging market debt investment strategy and was known as AB Emerging Market Debt Fund, Inc. In addition, on or around January 25, 2008, High Income Fund, Inc. merged with other retail fixed income mutual funds managed by the Adviser: AB Corporate Debt Portfolio (“Corporate Debt Portfolio”) and AB High Yield Fund, Inc. (“High Yield Fund, Inc.”). Emerging Market Debt Fund, Inc., Corporate Debt Portfolio and High Yield Fund, Inc. were categorized as High Income and accordingly, their advisory fee schedules were identical to each other under the High Income category.

94 •  AB HIGH YIELD PORTFOLIO

60 days’ notice prior to the Portfolio’s prospectus update. In addition, set forth below are the gross expense ratios of the Portfolio for the most recent semi-annual period:⁶

Portfolio	Expense Cap Pursuant to Expense Limitation Undertaking		Gross Expense Ratio7			Fiscal Year End
High Yield Portfolio8,9	Advisor	0.80%		9.04	%	Oct. 31 (ratios as of April 30, 2015)
	Class A	1.05%		7.52	%
	Class C	1.80%		9.12	%
	Class R	1.30%		4.28	%
	Class K	1.05%		4.01	%
	Class I	0.80%		3.74	%
	Class Z	0.80%		3.75	%

I. ADVISORY FEES CHARGED TO INSTITUTIONAL AND OTHER CLIENTS

The advisory fees charged to investment companies which the Adviser manages and sponsors are normally higher than those charged to similar sized institutional accounts, including pension plans and sub-advised investment companies. The fee differential reflects, among other things, different services provided to such clients, and different liabilities assumed. Services provided by the Adviser to the Portfolio that are not provided to non-investment company clients and sub-advised investment companies include providing office space and personnel to serve as Fund Officers, who among other responsibilities, make the certifications required under the Sarbanes-Oxley Act of 2002, and coordinating with and monitoring the Portfolio’s third party service providers such as Fund counsel, auditors, custodians, transfer agents and pricing services. The accounting, administrative, legal and compliance requirements for the Portfolio are more costly than those for institutional assets due to the greater complexities and time required for investment companies, although the Adviser is entitled to be reimbursed for providing some of these services. Also, retail mutual funds managed by the Adviser are widely held. Servicing the Portfolio’s investors is more time consuming and labor intensive compared to institutional clients since the Adviser needs to communicate with a more extensive network of financial intermediaries and shareholders. The Adviser also believes that it incurs substantial entrepreneurial risk when offering a new mutual fund since establishing a new mutual fund requires a large upfront investment and it may take a long time for the fund to achieve profitability since the fund must be priced to scale from inception in order to be competitive and assets are acquired one account at a time. Managing the cash flow of an investment company is more difficult than managing that of a stable pool of assets, such as an institutional account with little cash movement in

6 Semi-annual total expense ratios are unaudited.

7 Annualized

8 The Rule 12b-1 fee for Class A shares of the Fund is 0.25%.

9 The Portfolio’s fiscal percentage of net assets allocated to ETFs as of July 31, 2015 is 0.55%. The Portfolio’s acquired funds expense ratio related to such ETF holdings is 0.0008%.

AB HIGH YIELD PORTFOLIO  • 95

either direction, particularly, if a fund is in net redemption and the Adviser is frequently forced to sell securities to raise cash for redemptions. However, managing a fund with positive cash flow may be easier at times than managing a stable pool of assets. Finally, in recent years, investment advisers have been sued by institutional clients and have suffered reputational damage both by the attendant publicity and outcomes other than complete victories. Accordingly, the legal and reputational risks associated with institutional accounts are greater than previously thought, although still not equal to those related to the mutual fund industry.

Notwithstanding the Adviser’s view that managing an investment company is not comparable to managing other institutional accounts because the services provided are different, the Supreme Court has indicated consideration should be given to the advisory fees charged to institutional accounts with a similar investment style as the Portfolio.¹⁰ In addition to the AB Institutional fee schedule, set forth below is what would have been the effective advisory fee of the Portfolio had the AB Institutional fee schedule been applicable to the Portfolio based on September 30, 2015 net assets.¹¹

Portfolio	Net Assets ($MM)	AB Institutional Fee Schedule	Effective AB Inst. Adv. Fee (%)		Fund Advisory Fee (%)
High Yield Portfolio	$18.9	U.S. High Yield 0.55% on 1st $50 million 0.30% on the balance Minimum account size: $50m		0.550%		0.600%

The Adviser also manages and sponsors retail mutual funds, which are organized in jurisdictions outside the United States, generally Luxembourg, Japan, Taiwan, and South Korea and sold to non-United States resident investors. The Adviser charges the following fee for the Luxembourg fund that has a somewhat similar investment style as the Portfolio:

Portfolio	Luxembourg Fund	Fee12
High Yield Portfolio	U.S. High Yield
	Class A2	1.20%
	Class I2 (Institutional)	0.65%

10 The Supreme Court stated that “courts may give such comparisons the weight that they merit in light of the similarities and differences between the services that the clients in question require, but the courts must be wary of inapt comparisons.” Among the significant differences the Supreme Court noted that may exist between services provided to mutual funds and institutional accounts are “higher marketing costs.” Jones v. Harris at 1428.

11 The Adviser has indicated that with respect to institutional accounts with assets greater than $300 million, it will negotiate a fee schedule. Discounts that are negotiated vary based upon each client relationship.

12 Class A2 shares of the Luxembourg funds are charged an “all-in” fee, which covers investment advisory and distribution related services, unlike Class I2 shares, whose fee is for investment advisory services only.

96 •  AB HIGH YIELD PORTFOLIO

The AB Investment Trust Management mutual funds (“ITM”), which are offered to investors in Japan, have an “all-in” fee to compensate the Adviser for investment advisory as well as fund accounting and administrative related services. The table below shows the fee schedule of the ITM mutual fund that has a somewhat similar investment style as the Portfolio:

Portfolio	ITM Mutual Fund	Fee
High Yield Portfolio	High Yield Open Fund	1.00%

The Adviser represented that it does not provide sub-advisory investment services to other investment companies that have a substantially similar investment style as the Portfolio.

II. MANAGEMENT FEES CHARGED BY OTHER MUTUAL FUND COMPANIES FOR LIKE SERVICES.

Broadridge Financial Solutions, Inc. (“Broadridge”), an analytical service that is not affiliated with the Adviser, compared the fees charged to the Portfolio with fees charged to other investment companies for similar services offered by other investment advisers.^13,14 Broadridge’s analysis included the comparison of the Portfolio’s contractual management fee, estimated at the approximate current asset level of the Portfolio, to the median of the Fund’s Broadridge Expense Group (“EG”)¹⁵ and the Portfolio’s contractual management fee ranking.¹⁶

Broadridge describes an EG as a representative sample of comparable funds. Broadridge’s standard methodology for screening funds to be included in an EG

13 The Supreme Court cautioned against accepting mutual fund fee comparisons without careful scrutiny since “these comparisons are problematic because these fees, like those challenged, may not be the product of negotiations conducted at arm’s length.” Jones v. Harris at 1429.

14 On June 5, 2015, Broadridge acquired the Fiduciary Services and Competitive Intelligence unit, i.e., the group responsible for providing the Portfolio’s 15(c) reports, from Thomson Reuters’ Lipper division. The group that maintains Lipper’s expense and performance databases and investment classification/objective remains a part of Thomson Reuters’ Lipper division. Accordingly, the Portfolio’s investment classification/objective continued to be determined by Lipper.

15 Broadridge does not consider average account size when constructing EGs. Funds with relatively small average account sizes tend to have higher transfer agent expense ratios than comparable sized funds that have relatively large average account sizes. There are limitations to Lipper expense category data because different funds categorize expenses differently.

16 The contractual management fee is calculated by Broadridge using the Portfolio’s contractual management fee rate at the hypothetical asset level. The hypothetical asset level is based on the combined net assets of all classes of the Portfolio, rounded up to the next $25 million. Broadridge’s total expense ratio information is based on the most recent annual report except as otherwise noted. A ranking of “1” would mean that Portfolio had the lowest effective fee rate in the Broadridge peer group.

AB HIGH YIELD PORTFOLIO  • 97

entails the consideration of several fund criteria, including fund type, Lipper investment classification/objective, load type and similar 12b-1/non-12b-1 service fees, asset (size) comparability, expense components and attributes. An EG will typically consist of seven to twenty funds.

Portfolio	Contractual Management Fee (%)17		Broadridge EG Median (%)		Broadridge EG Rank
High Yield Portfolio		0.600		0.680		3/17

Broadridge also compared the Portfolio’s total expense ratio to the medians of the Portfolio’s EG and Broadridge Expense Universe (“EU”). The EU is a broader group compared to the EG, consisting of all funds that have the same investment classifications/objective and load type as the subject Portfolio.¹⁸

Portfolio	Expense Ratio (%)19		Broadridge EG Median (%)		Broadridge Group Rank		Broadridge EU Median (%)		Broadridge EU Rank
High Yield Portfolio		1.050		1.090		4/17		1.050		55/109

Based on this analysis, the Portfolio has a more favorable ranking on a contractual management fee basis than on a total expense ratio basis.

III. COSTS TO THE ADVISER AND ITS AFFILIATES OF SUPPLYING SERVICES PURSUANT TO THE MANAGEMENT FEE ARRANGEMENT, EXCLUDING ANY INTRA-CORPORATE PROFIT.

The Adviser utilizes two profitability reporting systems, which operate independently but are aligned with each other, to estimate the Adviser’s profitability in connection with investment advisory services provided to the Portfolio. The Senior Officer has retained a consultant to provide independent advice regarding the alignment of the two profitability systems as well as the methodologies and allocations utilized by both profitability systems. See Section IV for additional discussion.

17 The contractual management fee does not reflect any expense reimbursements made by the Portfolio to the Adviser for certain clerical, legal, accounting, administrative, and other services. In addition, the contractual management fee does not reflect any advisory fee waivers for expense caps.

18 Except for asset (size) comparability, Broadridge uses the same criteria for selecting an EG when selecting an EU. Unlike the EG, the EU allows for the same adviser to be represented by more than just one fund.

19 Most recently completed fiscal year Class A share total expense ratio.

98 •  AB HIGH YIELD PORTFOLIO

IV. PROFIT MARGINS OF THE ADVISER AND ITS AFFILIATES FOR SUPPLYING SUCH SERVICES.

The Portfolio’s profitability information, prepared by the Adviser for the Board of Directors, was reviewed by the Senior Officer and the consultant. The Adviser’s profitability from providing investment advisory services to the Portfolio was negative, during calendar year 2014.

In addition to the Adviser’s direct profits from managing the Portfolio, certain of the Adviser’s affiliates have business relationships with the Portfolio and may earn a profit from providing other services to the Portfolio. The courts have referred to this type of business opportunity as “fall-out benefits” to the Adviser and indicated that such benefits should be factored into the evaluation of the total relationship between the Portfolio and the Adviser. Neither case law nor common business practice precludes the Adviser’s affiliates from earning a reasonable profit on this type of relationship provided the affiliates’ charges and services are competitive and the relationship otherwise complies with the 40 Act restrictions. These affiliates will provide transfer agent and distribution related services to the Portfolio and will receive transfer agent fees, Rule 12b-1 payments, front-end sales loads and contingent deferred sales charges (“CDSC”). During the Portfolio’s most recently completed fiscal year, ABI received from the Portfolio $49 and $66 in front-end sales loads and Rule 12b-1 fees, respectively.

AllianceBernstein Investments, Inc. (“ABI”), an affiliate of the Adviser, is the Fund’s principal underwriter. ABI and the Adviser have disclosed in the Portfolio’s prospectus that they may make revenue sharing payments from their own resources, in addition to resources derived from sales loads and Rule 12b-1 fees, to firms that sell shares of the Portfolio. The total amount to be paid to a financial intermediary associated with the sale of shares will generally not exceed the sum of (a) 0.25% of the current year’s fund sales by that firm and (b) 0.10% of the average daily net assets attributable to that firm over the year. In 2014, ABI paid approximately 0.05% of the average monthly assets of the AB Mutual Funds or approximately $20.4 million for distribution services and educational support (revenue sharing payments).

Fees and reimbursements for out of pocket expenses to be charged by AllianceBernstein Investor Services, Inc. (“ABIS”), the affiliated transfer agent for the Portfolio, are based on the level of the network account and the class of shares held by the account. ABIS also receives a fee per shareholder sub-account for each account maintained by an intermediary on an omnibus basis. ABIS received $6,000 in fees from the Portfolio during the Portfolio’s most recently completed fiscal year.

AB HIGH YIELD PORTFOLIO  • 99

V. POSSIBLE ECONOMIES OF SCALE

The Adviser has indicated that economies of scale are being shared with shareholders through pricing to scale, breakpoints, fee reductions/waivers and enhancement to services.

In May 2012, an independent consultant, retained by the Senior Officer, provided the Board of Directors information on the Adviser’s firm-wide average costs from 2005 through 2011 and the potential economies of scale. The independent consultant noted that from 2005 through 2007 the Adviser experienced significant growth in assets under management (“AUM”). During this period, operating expenses increased, in part to keep up with growth, and in part reflecting market returns. However, from 2008 through the first quarter of 2009, AUM rapidly and significantly decreased due to declines in market value and client withdrawals. When AUM rapidly decreased, some operating expenses categories, including base compensation and office space, adjusted more slowly during this period, resulting in an increase in average costs. Since 2009, AUM has experienced less significant changes. The independent consultant noted that changes in operating expenses reflect changes in business composition and business practices in response to changes in financial markets. Finally, the independent consultant concluded that the increase in average cost and the decline in net operating margin across the Adviser since late 2008 are inconsistent with the view that there are currently reductions in average costs due to economies of scale that can be shared with the AB Mutual Funds managed by the Adviser through lower fees.

Previously, in February 2008, the independent consultant provided the Board of Directors an update of the Deli²⁰ study on advisory fees and various fund characteristics.²¹ The independent consultant first reiterated the results of his previous two dimensional comparison analysis (fund size and family size) with the Board of Directors.²² The independent consultant then discussed the results of the regression model that was utilized to study the effects of various factors on advisory fees. The regression model output indicated that the bulk of the variation in

20 The Deli study, originally published in 2002 based on 1997 data and updated for the February 2008 Presentation, may be of diminished value due to the age of the data used in the presentation and the changes experienced in the industry since 2008.

21 As mentioned previously, the Supreme Court cautioned against accepting mutual fund fee comparisons without careful scrutiny since the fees may not be the product of negotiations conducted at arm’s length. See Jones v. Harris at 1429.

22 The two dimensional analysis showed patterns of lower advisory fees for funds with larger asset sizes and funds from larger family sizes compared to funds with smaller asset sizes and funds from smaller family sizes, which according to the independent consultant is indicative of a sharing of economies of scale and scope. However, in less liquid and active markets, such is not the case, as the empirical analysis showed potential for diseconomies of scale in those markets. The empirical analysis also showed diminishing economies of scale and scope as funds surpassed a certain high level of assets.

100 •  AB HIGH YIELD PORTFOLIO

fees predicted were explained by various factors, but substantially by fund AUM, family AUM, index fund indicator and investment style. The independent consultant also compared the advisory fees of the AB Mutual Funds to similar funds managed by 19 other large asset managers, regardless of the fund size and each Adviser’s proportion of mutual fund assets to non-mutual fund assets.

VI. NATURE AND QUALITY OF THE ADVISER’S SERVICES, INCLUDING THE PERFORMANCE OF THE FUND

With assets under management of approximately $463 billion as of September 30, 2015, the Adviser has the investment experience to manage and provide non-investment services (described in Section I) to the Portfolio.

The information prepared by Broadridge shows the 1 year performance returns and rankings²³ of the Portfolio relative to its Broadridge Performance Group (“PG”) and Broadridge Performance Universe (“PU”)²⁴ for the period ended July 31, 2015.²⁵

	Fund Return (%)		PG Median (%)		PU Median (%)		PG Rank		PU Rank
High Yield Portfolio
1 year		0.19		-1.18		0.09		5/17		57/119

23 The performance returns and rankings of the Portfolio are for the Fund’s Class A shares. The performance returns of the Portfolio were provided by Broadridge.

24 The Portfolio’s PG is identical to the Portfolio’s EG. The Portfolio’s PU is not identical to the Portfolio’s EU as the criteria for including/excluding a fund from a PU is somewhat different from that of an EU.

25 The current Lipper investment classification/objective dictates the PG and PU throughout the life of the Portfolio even if the Portfolio had a different investment classification/objective at a different point in time.

AB HIGH YIELD PORTFOLIO  • 101

Set forth below are the 1 year and since inception performance returns of the Portfolio (in bold)²⁶ versus its benchmark.²⁷ Portfolio and benchmark volatility and reward-to-variability ratio (“Sharpe Ratio”) information is also shown.²⁸

	Period Ending July 31, 2015 Annualized Net Performance (%)
	1 Year (%)		Since Inception (%)		Volatility (%)		Sharpe (%)		Risk Period (Year)
High Yield Portfolio		0.19		-0.61		4.13		0.06		1
Barclays U.S. High Yield 2% Issuer Cap Index		0.37		-0.75		4.64		0.10		1
Inception Date: July 15, 2014

CONCLUSION:

Based on the factors discussed above the Senior Officer’s conclusion is that the proposed advisory fee for the Portfolio is reasonable and within the range of what would have been negotiated at arm’s length in light of all the surrounding circumstances. This conclusion in respect of the Portfolio is based on an evaluation of all of these factors and no single factor was dispositive.

Dated: November 25, 2015

26 The performance returns and risk measures shown in the table are for the Class A shares of the Portfolio.

27 The Adviser provided Portfolio and benchmark performance return information for periods through July 31, 2015.

28 Portfolio and benchmark volatility and Sharpe Ratio information was obtained through Lipper LANA, a database maintained by Lipper. Volatility is a statistical measure of the tendency of a market price or yield to vary over time. A Sharpe Ratio is a risk adjusted measure of return that divides a fund’s return in excess of the riskless return by the fund’s standard deviation. A fund with a greater volatility would be viewed as more risky than a fund with equivalent performance but lower volatility; for that reason, a greater return would be demanded for the more risky fund. A fund with a higher Sharpe Ratio would be viewed as better performing than a fund with a lower Sharpe Ratio.

102 •  AB HIGH YIELD PORTFOLIO

THIS PAGE IS NOT PART OF THE SHAREHOLDER REPORT OR THE FINANCIAL STATEMENTS

AB FAMILY OF FUNDS

US EQUITY

US Core

Core Opportunities Fund

Select US Equity Portfolio

US Growth

Concentrated Growth Fund

Discovery Growth Fund

Growth Fund

Large Cap Growth Fund

Small Cap Growth Portfolio

US Value

Discovery Value Fund

Equity Income Fund

Growth & Income Fund

Small Cap Value Portfolio

Value Fund

INTERNATIONAL/ GLOBAL EQUITY

International/Global Core

Global Core Equity Portfolio

Global Equity & Covered Call Strategy Fund

Global Thematic Growth Fund

International Portfolio

Tax-Managed International Portfolio

International/Global Growth

International Growth Fund

International/Global Value

Asia ex-Japan Equity Portfolio

International Value Fund

FIXED INCOME

Municipal

High Income Municipal Portfolio

Intermediate California Municipal Portfolio

Intermediate Diversified Municipal Portfolio

Intermediate New York Municipal Portfolio

Municipal Bond Inflation Strategy

FIXED INCOME (continued)

Tax-Aware Fixed Income Portfolio

National Portfolio

Arizona Portfolio

California Portfolio

Massachusetts Portfolio

Michigan Portfolio

Minnesota Portfolio

New Jersey Portfolio

New York Portfolio

Ohio Portfolio

Pennsylvania Portfolio

Virginia Portfolio

Taxable

Bond Inflation Strategy

Global Bond Fund

High Income Fund

High Yield Portfolio

Intermediate Bond Portfolio

Limited Duration High Income Portfolio

Short Duration Portfolio

ALTERNATIVES

All Market Real Return Portfolio*

Credit Long/Short Portfolio

Global Real Estate Investment Fund

Long/Short Multi-Manager Fund

Multi-Manager Alternative Strategies Fund

Select US Long/Short Portfolio

Unconstrained Bond Fund

MULTI-ASSET

All Market Growth Portfolio*

All Market Income Portfolio

Emerging Markets Multi-Asset Portfolio

Global Risk Allocation Fund

MULTI-ASSET (continued)

Target-Date

Multi-Manager Select Retirement Allocation Fund

Multi-Manager Select 2010 Fund

Multi-Manager Select 2015 Fund

Multi-Manager Select 2020 Fund

Multi-Manager Select 2025 Fund

Multi-Manager Select 2030 Fund

Multi-Manager Select 2035 Fund

Multi-Manager Select 2040 Fund

Multi-Manager Select 2045 Fund

Multi-Manager Select 2050 Fund

Multi-Manager Select 2055 Fund

Wealth Strategies

Balanced Wealth Strategy

Conservative Wealth Strategy

Wealth Appreciation Strategy

Tax-Managed Balanced Wealth Strategy

Tax-Managed Conservative Wealth Strategy

Tax-Managed Wealth Appreciation Strategy

CLOSED-END FUNDS

AB Multi-Manager Alternative Fund

Alliance California Municipal Income Fund

AllianceBernstein Global High Income Fund

AllianceBernstein Income Fund

AllianceBernstein National Municipal Income Fund

We also offer Exchange Reserves, which serves as the money market fund exchange vehicle for the AB mutual funds. An investment in Exchange Reserves is not a deposit in a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.

Investors should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.abglobal.com or contact your AB representative. Please read the prospectus and/or summary prospectus carefully before investing.

* Prior to December 15, 2014, All Market Growth Portfolio was named Dynamic All Market Fund; All Market Real Return Portfolio was named Real Asset Strategy.

AB HIGH YIELD PORTFOLIO  • 103

AB Family of Funds

NOTES

104 •  AB HIGH YIELD PORTFOLIO

NOTES

AB HIGH YIELD PORTFOLIO  • 105

NOTES

106 •  AB HIGH YIELD PORTFOLIO

NOTES

AB HIGH YIELD PORTFOLIO  • 107

NOTES

108 •  AB HIGH YIELD PORTFOLIO

AB HIGH YIELD PORTFOLIO

1345 Avenue of the Americas

New York, NY 10105

800.221.5672

HY-0151-1015                

OCT    ^10.31.15

ANNUAL REPORT

AB INTERMEDIATE BOND PORTFOLIO

Investment Products Offered

• Are Not FDIC Insured

• May Lose Value

• Are Not Bank Guaranteed

Investors should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.abglobal.com or contact your AB representative. Please read the prospectus and/or summary prospectus carefully before investing.

This shareholder report must be preceded or accompanied by the Fund’s prospectus for individuals who are not current shareholders of the Fund.

You may obtain a description of the Fund’s proxy voting policies and procedures, and information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30, without charge. Simply visit AB’s website at www.abglobal.com, or go to the Securities and Exchange Commission’s (the “Commission”) website at www.sec.gov, or call AB at (800) 227-4618.

The Fund files its complete schedule of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q are available on the Commission’s website at www.sec.gov. The Fund’s Forms N-Q may also be reviewed and copied at the Commission’s Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330. AB publishes full portfolio holdings for the Fund monthly at www.abglobal.com.

AllianceBernstein Investments, Inc. (ABI) is the distributor of the AB family of mutual funds. ABI is a member of FINRA and is an affiliate of AllianceBernstein L.P., the Adviser of the funds.

The [A/B] logo is a registered service mark of AllianceBernstein and AllianceBernstein^® is a registered service mark used by permission of the owner, AllianceBernstein L.P.

December 11, 2015

Annual Report

This report provides management’s discussion of fund performance for AB Intermediate Bond Portfolio (the “Portfolio”) for the annual reporting period ended October 31, 2015. Effective January 20, 2015, the Portfolio’s named changed from AllianceBernstein Intermediate Bond Portfolio to AB Intermediate Bond Portfolio.

Investment Objective and Policies

The Portfolio’s investment objective is to generate income and price appreciation without assuming what AllianceBernstein L.P. (the “Adviser”) considers undue risk. The Portfolio invests, under normal circumstances, at least 80% of its net assets in fixed-income securities. The Portfolio expects to invest in readily marketable fixed-income securities with a range of maturities from short- to long-term and relatively attractive yields that do not involve undue risk of loss of capital. The Portfolio expects to invest in fixed-income securities with a dollar-weighted average maturity of between three to ten years and an average duration of three to six years. The Portfolio may invest up to 25% of its net assets in below investment-grade bonds. The Portfolio may use leverage for investment purposes.

The Portfolio may invest without limit in US dollar-denominated foreign fixed-income securities and may invest up to 25% of its assets in non-US dollar-denominated foreign fixed-income securities. These investments may include, in each case, developed and emerging market debt securities.

The Adviser selects securities for purchase or sale based on its assessment of the securities’ risk and return characteristics as well as the securities’ impact on the overall risk and return characteristics of the Portfolio. In making this assessment, the Adviser takes into account various factors, including the credit quality and sensitivity to interest rates of the securities under consideration and of the Portfolio’s other holdings.

The Portfolio may invest in mortgage-related and other asset-backed securities, loan participations, inflation-protected securities, structured securities, variable, floating, and inverse floating-rate instruments and preferred stock, and may use other investment techniques. The Portfolio intends, among other things, to enter into transactions such as reverse repurchase agreements and dollar rolls. The Portfolio may invest, without limit, in derivatives, such as options, futures, forwards or swaps.

Investment Results

The table on page 5 shows the Portfolio’s performance compared with its benchmark, the Barclays US Aggregate Bond Index for the six- and 12-month periods ended October 31, 2015.

All share classes underperformed the benchmark for both periods, before sales charges. Sector positioning contributed to performance for both periods, specifically an overweight to collateralized mortgage obligations, asset-backed securities and commercial mortgage-backed securities, relative to

AB INTERMEDIATE BOND PORTFOLIO  • 1

the benchmark. Security selection detracted modestly, mainly from security selection within energy and agency mortgage-backed securities. Currency positioning contributed, specifically short positions in the Australian dollar, euro and Canadian dollar versus a long US dollar position. Yield-curve positioning detracted, specifically an underweight to the two-year portion of the yield curve for the six-month period and a general underweight to duration for the 12-month period, as interest rates rallied.

The Portfolio utilized derivatives including Treasury futures and interest rate swaps to manage duration and yield curve positioning for both periods. Credit default swaps were utilized for hedging and investment purposes, which had an immaterial impact during both periods in absolute terms; currency forwards were utilized for both hedging and investment purposes to manage the Portfolio’s overall currency exposure. Purchased and written options were utilized for hedging purposes, which had an immaterial impact on performance during both periods. Currency swaps were utilized for hedging purposes, which had an immaterial impact during both periods; inflation swaps were utilized to manage inflation protection.

Market Review and Investment Strategy

Bond markets were volatile for the 12-month period ended October 31, 2015, as growth trends and monetary

policies in the world’s biggest economies headed in different directions. Inflation continued to fall throughout the developed world, driven primarily by decreasing commodity prices. While oil prices began to rebound in April, they again fell in August, remaining well below their price range in late 2014. These dynamics caused volatility within government bond yields, with the yield on the 10-year US Treasury ranging from 1.7% to 2.5%, ultimately ending the period at 2.2%. Adding to the volatility, the US Federal Reserve postponed its long expected interest-rate hike, alluding to emerging market turmoil as one of the reasons.

In other markets, including many in Europe where the European Central Bank implemented its quantitative easing program, some yields ended the period in negative territory. In emerging markets, political and economic instability across regions negatively affected the investment environment. Slower growth in China, Brazil and other emerging market economies caused further pressure on credit markets at the end of the 12-month period. Against this backdrop, fixed-income returns diverged between regions and sectors. Credit securities generally underperformed developed market Treasuries; developed market Treasuries generally outperformed emerging market local currency Treasuries; and investment-grade securities generally outperformed high-yield, which posted some of the worst returns across the fixed-income market, specifically within the energy and commodities sectors.

2 •  AB INTERMEDIATE BOND PORTFOLIO

DISCLOSURES AND RISKS

Benchmark Disclosure

The unmanaged Barclays US Aggregate Bond Index does not reflect fees and expenses associated with the active management of a mutual fund portfolio. The Barclays US Aggregate Bond Index represents the performance of securities within the US investment-grade fixed-rate bond market, with index components for government and corporate securities, mortgage pass-through securities, asset-backed securities, and commercial mortgage-backed securities. An investor cannot invest directly in an index, and its results are not indicative of the performance for any specific investment, including the Portfolio.

A Word About Risk

Market Risk: The value of the Portfolio’s assets will fluctuate as the stock or bond market fluctuates. The value of its investments may decline, sometimes rapidly and unpredictably, simply because of economic changes or other events that affect large portions of the market.

Interest Rate Risk: Changes in interest rates will affect the value of investments in fixed-income securities. When interest rates rise, the value of investments in fixed-income securities tends to fall and this decrease in value may not be offset by higher income from new investments. The Portfolio may be subject to a heightened risk of rising interest rates due to the current period of historically low rates and the effect of government fiscal policy initiatives, including Federal Reserve actions, and market reaction to these initiatives. The current period of historically low rates is expected to end and rates are expected to begin rising in the near future. Interest rate risk is generally greater for fixed-income securities with longer maturities or durations.

Duration Risk: Duration is a measure that relates the expected price volatility of a fixed-income security to changes in interest rates. The duration of a fixed-income security may be shorter than or equal to full maturity of a fixed-income security. Fixed-income securities with longer durations have more risk and will decrease in price as interest rates rise. For example, a fixed-income security with a duration of three years will decrease in value by approximately 3% if interest rates increase by 1%.

Credit Risk: An issuer or guarantor of a fixed-income security, or the counterparty to a derivatives or other contract, may be unable or unwilling to make timely payments of interest or principal, or to otherwise honor its obligations. The issuer or guarantor may default, causing a loss of the full principal amount of a security. The degree of risk for a particular security may be reflected in its credit rating. There is the possibility that the credit rating of a fixed-income security may be downgraded after purchase, which may adversely affect the value of the security.

Below Investment Grade Securities Risk: Investments in fixed-income securities with lower ratings (commonly known as “junk bonds”) are subject to a higher probability that an issuer will default or fail to meet its payment obligations. These securities may be subject to greater price volatility due to such factors as specific corporate developments, negative perceptions of the junk bond market generally and less secondary market liquidity.

Inflation Risk: This is the risk that the value of assets or income from investments will be less in the future as inflation decreases the value of money. As inflation increases, the value of the Portfolio’s assets can decline as can the value of the Portfolio’s distributions. This risk is significantly greater if the Portfolio invests a significant portion of its assets in fixed-income securities with longer maturities.

Foreign (Non-US) Risk: Investments in securities of non-US issuers may involve more risk than those of US issuers. These securities may fluctuate more widely in price and may be less liquid due to adverse market, economic, political, regulatory or other factors.

Emerging Market Risk: Investments in emerging market countries may have more risk because the markets are less developed and less liquid as well as being subject to increased economic, political, regulatory or other uncertainties.

(Disclosures, Risks and Note about Historical Performance continued on next page)

AB INTERMEDIATE BOND PORTFOLIO  • 3

Disclosures and Risks

DISCLOSURES AND RISKS

(continued from previous page)

Currency Risk: Fluctuations in currency exchange rates may negatively affect the value of the Portfolio’s investments or reduce its returns.

Prepayment Risk: The value of mortgage-related or asset-backed securities may be particularly sensitive to changes in prevailing interest rates. Early payments of principal on some mortgage-related securities may occur during periods of falling mortgage interest rates and expose the Portfolio to a lower rate of return upon reinvestment of principal. Early payments associated with mortgage-related securities cause these securities to experience significantly greater price and yield volatility than is experienced by traditional fixed-income securities. During periods of rising interest rates, a reduction in prepayments may increase the effective life of mortgage-related securities, subjecting them to greater risk of decline in market value in response to rising interest rates. If the life of a mortgage-related security is inaccurately predicted, the Portfolio may not be able to realize the rate of return it expected.

Leverage Risk: To the extent the Portfolio uses leveraging techniques, its net asset value (“NAV”) may be more volatile because leverage tends to exaggerate the effects of changes in interest rates and any increase or decrease in the value of the Portfolio’s investments.

Derivatives Risk: Derivatives may be illiquid, difficult to price, and leveraged so that small changes may produce disproportionate losses for the Portfolio, and may be subject to counterparty risk to a greater degree than more traditional investments.

Liquidity Risk: Liquidity risk occurs when certain investments become difficult to purchase or sell. Difficulty in selling less liquid securities may result in sales at disadvantageous prices affecting the value of your investment in the Portfolio. Causes of liquidity risk may include low trading volumes, large positions and heavy redemptions of Fund shares. Over recent years liquidity risk has also increased because the capacity of dealers in the secondary market for fixed-income securities to make markets in these securities has decreased, even as the overall bond market has grown significantly, due to, among other things, structural changes, additional regulatory requirements and capital and risk restraints that have led to reduced inventories. Liquidity risk may be higher in a rising interest rate environment, when the value and liquidity of fixed-income securities generally go down.

Management Risk: The Portfolio is subject to management risk because it is an actively-managed investment fund. The Adviser will apply its investment techniques and risk analyses in making investment decisions, but there is no guarantee that its techniques will produce the intended results.

These risks are fully discussed in the Portfolio’s prospectus. As with all investments, you may lose money by investing in the Portfolio.

An Important Note About Historical Performance

The investment return and principal value of an investment in the Portfolio will fluctuate, so that shares, when redeemed, may be worth more or less than their original cost. Performance shown on the following pages represents past performance and does not guarantee future results. Current performance may be lower or higher than the performance information shown. You may obtain performance information current to the most recent month-end by visiting www.abglobal.com.

All fees and expenses related to the operation of the Portfolio have been deducted. NAV returns do not reflect sales charges; if sales charges were reflected, the Portfolio’s quoted performance would be lower. SEC returns reflect the applicable sales charges for each share class: a 4.25% maximum front-end sales charge for Class A shares; the applicable contingent deferred sales charge for Class B shares (3% year 1, 2% year 2, 1% year 3); a 1% 1-year contingent deferred sales charge for Class C shares. Returns for the different share classes will vary due to different expenses associated with each class. Performance assumes reinvestment of distributions and does not account for taxes.

4 •  AB INTERMEDIATE BOND PORTFOLIO

Disclosures and Risks

HISTORICAL PERFORMANCE

THE PORTFOLIO VS. ITS BENCHMARK PERIODS ENDED OCTOBER 31, 2015 (unaudited)	NAV Returns
	6 Months		12 Months
AB Intermediate Bond Portfolio
Class A		-0.57%		1.45%
Class B*		-0.94%		0.72%
Class C		-0.94%		0.73%
Advisor Class†		-0.44%		1.73%
Class R †		-0.69%		1.23%
Class K †		-0.57%		1.57%
Class I †		-0.44%		1.73%
Class Z†		-0.44%		1.72%
Barclays US Aggregate Bond Index		-0.10%		1.96%
*    Effective January 31, 2009, Class B shares are no longer available for purchase to new investors. Please see Note A for additional information. †     Please note that these share classes are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Portfolio.

See Disclosures, Risks and Note about Historical Performance on pages 3-4.

(Historical Performance continued on next page)

AB INTERMEDIATE BOND PORTFOLIO  • 5

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

GROWTH OF A $10,000 INVESTMENT IN THE PORTFOLIO 10/31/05 TO 10/31/15 (unaudited)

This chart illustrates the total value of an assumed $10,000 investment in AB Intermediate Bond Portfolio Class A shares (from 10/31/05 to 10/31/15) as compared to the performance of the Portfolio’s benchmark. The chart reflects the deduction of the maximum 4.25% sales charge from the initial $10,000 investment in the Portfolio and assumes the reinvestment of dividends and capital gains distributions.

See Disclosures, Risks and Note about Historical Performance on pages 3-4.

(Historical Performance continued on next page)

6 •  AB INTERMEDIATE BOND PORTFOLIO

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

AVERAGE ANNUAL RETURNS AS OF OCTOBER 31, 2015 (unaudited)
	NAV Returns			SEC Returns (reflects applicable sales charges)			SEC Yields*
Class A Shares								2.06	%
1 Year		1.45	%		-2.87	%
5 Years		3.24	%		2.34	%
10 Years		4.67	%		4.21	%
Class B Shares								1.39	%
1 Year		0.72	%		-2.23	%
5 Years		2.53	%		2.53	%
10 Years(a)		4.29	%		4.29	%
Class C Shares								1.41	%
1 Year		0.73	%		-0.26	%
5 Years		2.53	%		2.53	%
10 Years		3.95	%		3.95	%
Advisor Class Shares†								2.40	%
1 Year		1.73	%		1.73	%
5 Years		3.52	%		3.52	%
10 Years		4.98	%		4.98	%
Class R Shares†								1.76	%
1 Year		1.23	%		1.23	%
5 Years		3.03	%		3.03	%
10 Years		4.45	%		4.45	%
Class K Shares†								2.07	%
1 Year		1.57	%		1.57	%
5 Years		3.29	%		3.29	%
10 Years		4.71	%		4.71	%
Class I Shares†								2.39	%
1 Year		1.73	%		1.73	%
5 Years		3.52	%		3.52	%
10 Years		4.97	%		4.97	%
Class Z Shares†								2.48	%
1 Year		1.72	%		1.72	%
Since Inception‡		2.86	%		2.86	%

See Disclosures, Risks and Note about Historical Performance on pages 3-4.

(Historical Performance and footnotes continued on next page)

AB INTERMEDIATE BOND PORTFOLIO  • 7

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

The Portfolio’s prospectus fee table shows the Portfolio’s total annual operating expense ratios as 1.01%, 1.78%, 1.77%, 0.75%, 1.36%, 1.03%, 0.75% and 0.66% for Class A, Class B, Class C, Advisor Class, Class R, Class K, Class I and Class Z shares, respectively, gross of any fee waivers or expense reimbursements. Contractual fee waivers and/or expense reimbursements limit the Portfolio’s annual operating expense ratios to 0.85%, 1.60%, 1.60%, 0.60%, 1.10%, 0.85%, 0.60% and 0.60% for Class A, Class B, Class C, Advisor Class, Class R, Class K, Class I and Class Z shares, respectively. These waivers/reimbursements may not be terminated before January 29, 2016 and may be extended by the Adviser for additional one-year terms. Absent reimbursements or waivers, performance would have been lower. The Financial Highlights section of this report sets forth expense ratio data for the current reporting period; the expense ratios shown above may differ from the expense ratios in the Financial Highlights sections since they are based on different time periods.

* SEC yields are calculated based on SEC guidelines for the 30-day period ended October 31, 2015.

^(a)  Assumes conversion of Class B shares into Class A shares after six years.

^†  These share classes are offered at NAV to eligible investors and their SEC returns are the same as their NAV returns. Please note that these share classes are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Portfolio.

^‡  Inception date: 4/25/2014.

See Disclosures, Risks and Note about Historical Performance on pages 3-4.

(Historical Performance continued on next page)

8 •  AB INTERMEDIATE BOND PORTFOLIO

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

SEC AVERAGE ANNUAL RETURNS AS OF THE MOST RECENT CALENDAR QUARTER-END SEPTEMBER 30, 2015 (unaudited)
	SEC Returns (reflects applicable sales charges)
Class A Shares
1 Year		-2.38	%
5 Years		2.42	%
10 Years		4.10	%
Class B Shares
1 Year		-1.70	%
5 Years		2.61	%
10 Years(a)		4.17	%
Class C Shares
1 Year		0.29	%
5 Years		2.61	%
10 Years		3.84	%
Advisor Class Shares†
1 Year		2.20	%
5 Years		3.60	%
10 Years		4.87	%
Class R Shares†
1 Year		1.78	%
5 Years		3.11	%
10 Years		4.35	%
Class K Shares†
1 Year		2.04	%
5 Years		3.37	%
10 Years		4.61	%
Class I Shares†
1 Year		2.19	%
5 Years		3.60	%
10 Years		4.87	%
Class Z Shares†
1 Year		2.29	%
Since Inception‡		2.88	%

^(a)  Assumes conversion of Class B shares into Class A shares after six years.

^†  Please note that these share classes are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Portfolio.

^‡  Inception date: 4/25/2014.

See Disclosures, Risks and Note about Historical Performance on pages 3-4.

AB INTERMEDIATE BOND PORTFOLIO  • 9

Historical Performance

EXPENSE EXAMPLE

(unaudited)

As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, contingent deferred sales charges on redemptions and (2) ongoing costs, including management fees; distribution (12b-1) fees; and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period as indicated below.

Actual Expenses

The table below provides information about actual account values and actual expenses. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed annual rate of return of 5% before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds by comparing this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), or contingent deferred sales charges on redemptions. Therefore, the hypothetical example is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Beginning Account Value May 1, 2015		Ending Account Value October 31, 2015		Expenses Paid During Period*		Annualized Expense Ratio*
Class A
Actual	$	1,000	$	994.30	$	4.32		0.86	%
Hypothetical**	$	1,000	$	1,020.87	$	4.38		0.86	%
Class B
Actual	$	1,000	$	990.60	$	8.03		1.60	%
Hypothetical**	$	1,000	$	1,017.14	$	8.13		1.60	%
Class C
Actual	$	1,000	$	990.60	$	8.03		1.60	%
Hypothetical**	$	1,000	$	1,017.14	$	8.13		1.60	%
Advisor Class
Actual	$	1,000	$	995.60	$	3.02		0.60	%
Hypothetical**	$	1,000	$	1,022.18	$	3.06		0.60	%
Class R
Actual	$	1,000	$	993.10	$	5.53		1.10	%
Hypothetical**	$	1,000	$	1,019.66	$	5.60		1.10	%
Class K
Actual	$	1,000	$	994.30	$	4.27		0.85	%
Hypothetical**	$	1,000	$	1,020.92	$	4.33		0.85	%
Class I
Actual	$	1,000	$	995.60	$	3.02		0.60	%
Hypothetical**	$	1,000	$	1,022.18	$	3.06		0.60	%
Class Z
Actual	$	1,000	$	995.60	$	3.02		0.60	%
Hypothetical**	$	1,000	$	1,022.18	$	3.06		0.60	%

* Expenses are equal to the classes’ annualized expense ratios multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).

** Assumes 5% annual return before expenses.

10 •  AB INTERMEDIATE BOND PORTFOLIO

Expense Example

PORTFOLIO SUMMARY

October 31, 2015 (unaudited)

PORTFOLIO STATISTICS

Net Assets ($mil): $330.5

TOP TEN SECTORS (including derivatives)^*

Corporates – Investment Grade	24.4	%
Governments – Treasuries(a)	22.4
Asset-Backed Securities	16.1
Mortgage Pass-Throughs	15.7
Commercial Mortgage-Backed Securities	13.4
Collateralized Mortgage Obligations	6.3
Corporates – Non Investment Grade(b)	5.5
Inflation-Linked Securities(c)	1.7
Quasi-Sovereigns	0.9
Interest Rate Swaps(d)	-27.3

SECTOR BREAKDOWN (excluding derivatives)^**

Corporates – Investment Grade	23.0	%
Asset-Backed Securities	15.5
Mortgage Pass-Throughs	15.1
Commercial Mortgage-Backed Securities	12.8
Governments – Treasuries	11.3
Corporates – Non-Investment Grade	6.3
Collateralized Mortgage Obligations	6.0
Inflation-Linked Securities	3.2

Quasi-Sovereigns	0.9	%
Governments – Sovereign Agencies	0.5
Local Governments – Municipal Bonds	0.4
Common Stocks	0.4
Preferred Stocks	0.2
Short-Term	4.3
Other	0.1
	100.0	%

* All data are as of October 31, 2015. The Portfolio’s sectors include derivative exposure and are expressed as approximate percentages of the Portfolio’s total net assets, based on the Adviser’s internal classification. The percentages will vary over time.

(a) Includes Treasury Futures.

(b) Includes Credit Default Swaps.

(c) Includes Inflation (CPI) Swaps.

(d) Represents the exposure of the Portfolio’s fixed-rate payments on the Interest Rate Swaps. Interest Rate Swaps involve the exchange by a fund with another party of payments calculated by reference to specified interest rates (e.g., an exchange of floating-rate payments for fixed-rate payments).

** All data are as of October 31, 2015. The Portfolio’s sector breakdown is expressed as a percentage of total investments and may vary over time. The Portfolio also enters into derivative transactions, which may be used for hedging or investment purposes (see “Portfolio of Investments” section of the report for additional details). “Other” represents the following categories: Emerging Markets – Corporate Bonds and Governments – Sovereign Bonds.

AB INTERMEDIATE BOND PORTFOLIO  • 11

Portfolio Summary

PORTFOLIO OF INVESTMENTS

October 31, 2015

		Principal Amount (000)		U.S. $ Value
CORPORATES – INVESTMENT GRADE – 23.9%
Industrial – 15.2%
Basic – 1.1%
Barrick Gold Corp. 4.10%, 5/01/23	U.S.$		210	$	195,058
Eastman Chemical Co. 3.80%, 3/15/25			290		288,439
Freeport-McMoran Oil & Gas LLC/FCX Oil & Gas, Inc. 6.50%, 11/15/20			119		107,844
Glencore Funding LLC 4.125%, 5/30/23(a)			286		230,945
International Paper Co. 3.65%, 6/15/24			133		131,529
3.80%, 1/15/26			279		278,404
4.75%, 2/15/22			194		208,274
5.15%, 5/15/46			106		103,943
LyondellBasell Industries NV 5.75%, 4/15/24			766		867,549
Minsur SA 6.25%, 2/07/24(a)			335		351,891
Mosaic Co. (The) 5.625%, 11/15/43			244		255,837
Sociedad Quimica y Minera de Chile SA 3.625%, 4/03/23(a)			562		477,700
Vale Overseas Ltd. 6.875%, 11/21/36			180		146,538
					3,643,951
Capital Goods – 0.3%
Odebrecht Finance Ltd. 5.25%, 6/27/29(a)			541		313,104
Owens Corning 6.50%, 12/01/16(b)			55		58,379
Yamana Gold, Inc. 4.95%, 7/15/24			724		664,279
					1,035,762
Communications - Media – 2.4%
21st Century Fox America, Inc. 6.15%, 3/01/37-2/15/41			902		1,044,605
6.55%, 3/15/33			142		169,362
CBS Corp. 3.50%, 1/15/25			290		282,598
5.75%, 4/15/20			710		795,710
CCO Safari II LLC 4.908%, 7/23/25(a)			435		442,170
Cox Communications, Inc. 2.95%, 6/30/23(a)			233		209,765

12 •  AB INTERMEDIATE BOND PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Discovery Communications LLC 3.45%, 3/15/25	U.S.$		467	$	435,943
McGraw Hill Financial, Inc. 4.40%, 2/15/26(a)			584		597,736
NBCUniversal Enterprise, Inc. 5.25%, 3/19/21(a)(c)			604		643,260
Time Warner Cable, Inc. 4.50%, 9/15/42			230		186,293
5.00%, 2/01/20			740		791,736
Time Warner, Inc. 3.55%, 6/01/24			518		515,807
4.70%, 1/15/21			600		653,046
7.625%, 4/15/31			154		196,747
Viacom, Inc. 3.875%, 4/01/24			803		761,509
5.625%, 9/15/19			240		263,476
					7,989,763
Communications - Telecommunications – 1.9%
American Tower Corp. 5.05%, 9/01/20			1,185		1,288,153
AT&T, Inc. 3.40%, 5/15/25			1,275		1,237,238
Deutsche Telekom International Finance BV 4.875%, 3/06/42(a)			50		51,642
DIRECTV Holdings LLC/DIRECTV Financing Co., Inc. 3.80%, 3/15/22			252		258,027
4.45%, 4/01/24			349		359,872
4.60%, 2/15/21			565		606,327
5.00%, 3/01/21			225		245,968
Rogers Communications, Inc. 4.00%, 6/06/22	CAD		130		104,550
Telefonica Emisiones SAU 5.462%, 2/16/21	U.S.$		520		580,310
Verizon Communications, Inc. 6.55%, 9/15/43			1,240		1,484,315
					6,216,402
Consumer Cyclical - Automotive – 1.0%
Ford Motor Credit Co. LLC 3.664%, 9/08/24			603		599,517
5.875%, 8/02/21			1,291		1,471,584
General Motors Co. 3.50%, 10/02/18			340		345,647
General Motors Financial Co., Inc. 3.10%, 1/15/19			560		561,856
3.25%, 5/15/18			43		43,523
4.00%, 1/15/25			106		103,930
4.30%, 7/13/25			135		137,387
					3,263,444

AB INTERMEDIATE BOND PORTFOLIO  • 13

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Consumer Cyclical - Retailers – 0.7%
CVS Health Corp. 3.875%, 7/20/25	U.S.$		665	$	683,983
Kohl’s Corp. 4.25%, 7/17/25			839		832,586
Walgreens Boots Alliance, Inc. 3.80%, 11/18/24			885		878,367
					2,394,936
Consumer Non-Cyclical – 3.6%
AbbVie, Inc. 3.60%, 5/14/25			437		429,583
Actavis Funding SCS 3.80%, 3/15/25			770		763,022
3.85%, 6/15/24			238		236,831
Agilent Technologies, Inc. 5.00%, 7/15/20			217		233,200
Altria Group, Inc. 2.625%, 1/14/20			885		893,332
AstraZeneca PLC 6.45%, 9/15/37			235		306,906
Baxalta, Inc. 5.25%, 6/23/45(a)			335		341,189
Bayer US Finance LLC 3.375%, 10/08/24(a)			321		323,210
Becton Dickinson and Co. 3.734%, 12/15/24			388		396,985
Biogen, Inc. 4.05%, 9/15/25			683		691,423
Bunge Ltd. Finance Corp. 8.50%, 6/15/19			6		7,096
Celgene Corp. 3.875%, 8/15/25			735		736,937
Gilead Sciences, Inc. 3.65%, 3/01/26			656		663,221
Grupo Bimbo SAB de CV 3.875%, 6/27/24(a)			538		530,344
Kraft Heinz Foods Co. 2.80%, 7/02/20(a)			335		336,303
3.50%, 7/15/22(a)			430		438,228
Kroger Co. (The) 3.40%, 4/15/22			916		934,152
Laboratory Corp. of America Holdings 3.60%, 2/01/25			265		257,929
Medtronic, Inc. 3.50%, 3/15/25			890		911,357
Perrigo Finance PLC 3.50%, 12/15/21			217		212,322
3.90%, 12/15/24			360		346,451

14 •  AB INTERMEDIATE BOND PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Reynolds American, Inc. 3.25%, 11/01/22	U.S.$		616	$	612,892
5.85%, 8/15/45			202		224,085
Thermo Fisher Scientific, Inc. 4.15%, 2/01/24			383		400,363
Tyson Foods, Inc. 2.65%, 8/15/19			164		165,283
3.95%, 8/15/24			541		552,316
					11,944,960
Energy – 3.2%
Diamond Offshore Drilling, Inc. 4.875%, 11/01/43			292		205,662
Encana Corp. 3.90%, 11/15/21			415		385,941
Energy Transfer Partners LP 6.70%, 7/01/18			411		446,697
7.50%, 7/01/38			237		246,768
EnLink Midstream Partners LP 5.05%, 4/01/45			562		453,229
Enterprise Products Operating LLC 3.70%, 2/15/26			735		698,613
5.20%, 9/01/20			235		258,353
Kinder Morgan Energy Partners LP 3.95%, 9/01/22			1,460		1,358,933
4.15%, 3/01/22			339		323,142
Noble Energy, Inc. 3.90%, 11/15/24			463		440,719
8.25%, 3/01/19			1,232		1,435,142
Noble Holding International Ltd. 4.90%, 8/01/20			34		29,202
Plains All American Pipeline LP/PAA Finance Corp. 3.60%, 11/01/24			594		554,766
Regency Energy Partners LP/Regency Energy Finance Corp. 4.50%, 11/01/23			135		123,905
5.75%, 9/01/20			420		445,316
Reliance Holding USA, Inc. 5.40%, 2/14/22(a)			636		697,116
Sunoco Logistics Partners Operations LP 5.30%, 4/01/44			460		364,554
TransCanada PipeLines Ltd. 6.35%, 5/15/67			831		689,730
Valero Energy Corp. 6.125%, 2/01/20			770		871,401
Williams Partners LP 4.125%, 11/15/20			403		402,243
					10,431,432

AB INTERMEDIATE BOND PORTFOLIO  • 15

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Other Industrial – 0.1%
Hutchison Whampoa International 14 Ltd. 1.625%, 10/31/17(a)	U.S.$		340	$	339,080
Technology – 0.9%
Hewlett Packard Enterprise Co. 4.90%, 10/15/25(a)			825		815,220
Hewlett-Packard Co. 4.65%, 12/09/21			266		276,417
KLA-Tencor Corp. 4.65%, 11/01/24			614		618,270
Motorola Solutions, Inc. 3.50%, 3/01/23			413		368,376
7.50%, 5/15/25			30		33,996
Seagate HDD Cayman 4.75%, 1/01/25			336		301,772
Total System Services, Inc. 2.375%, 6/01/18			344		343,783
3.75%, 6/01/23			350		342,061
					3,099,895
					50,359,625
Financial Institutions – 7.5%
Banking – 4.4%
ABN AMRO Bank NV 4.75%, 7/28/25(a)			272		274,281
Bank of America Corp. Series L 2.60%, 1/15/19			1,053		1,065,421
Barclays Bank PLC 6.625%, 3/30/22(a)	EUR		333		462,768
Barclays PLC 3.65%, 3/16/25	U.S.$		389		376,211
BPCE SA 5.70%, 10/22/23(a)			230		246,237
Compass Bank 5.50%, 4/01/20			1,339		1,427,903
Cooperatieve Centrale Raiffeisen-Boerenleenbank BA/Netherlands 4.375%, 8/04/25			500		510,129
Countrywide Financial Corp. 6.25%, 5/15/16			62		63,654
Credit Suisse Group Funding Guernsey Ltd. 3.75%, 3/26/25(a)			1,035		1,011,898
Goldman Sachs Group, Inc. (The) 3.75%, 5/22/25			254		255,844
3.85%, 7/08/24			905		923,201
Series D 6.00%, 6/15/20			1,430		1,638,132

16 •  AB INTERMEDIATE BOND PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Mizuho Financial Group Cayman 3 Ltd. 4.60%, 3/27/24(a)	U.S.$		812	$	832,845
Morgan Stanley 5.625%, 9/23/19			478		532,582
Series G 4.00%, 7/23/25			825		848,388
5.50%, 7/24/20			590		662,783
Murray Street Investment Trust I 4.647%, 3/09/17			125		129,970
Rabobank Capital Funding Trust III 5.254%, 10/21/16(a)(c)			430		437,998
Santander UK PLC 5.00%, 11/07/23(a)			500		521,460
Standard Chartered PLC Series E 4.00%, 7/12/22(a)			1,310		1,328,628
UBS AG/Stamford CT 7.625%, 8/17/22			620		717,080
UBS Group Funding Jersey Ltd. 4.125%, 9/24/25(a)			436		437,529
					14,704,942
Finance – 0.2%
Aviation Capital Group Corp. 7.125%, 10/15/20(a)			552		637,530
Insurance – 2.5%
American International Group, Inc. 6.40%, 12/15/20			680		802,930
8.175%, 5/15/58			940		1,240,800
Dai-ichi Life Insurance Co., Ltd. (The) 5.10%, 10/28/24(a)(c)			393		407,738
Guardian Life Insurance Co. of America (The) 7.375%, 9/30/39(a)			542		711,825
Hartford Financial Services Group, Inc. (The) 5.50%, 3/30/20			726		811,327
Lincoln National Corp. 8.75%, 7/01/19			361		441,279
MetLife Capital Trust IV 7.875%, 12/15/37(a)			699		866,760
Nationwide Mutual Insurance Co. 9.375%, 8/15/39(a)			246		371,884
Prudential Financial, Inc. 5.625%, 6/15/43			920		962,780
Swiss Reinsurance Co. via ELM BV 5.252%, 5/25/16(a)(c)	EUR		850		952,036
ZFS Finance USA Trust V 6.50%, 5/09/37(a)	U.S.$		538		550,105
					8,119,464

AB INTERMEDIATE BOND PORTFOLIO  • 17

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
REITS – 0.4%
Host Hotels & Resorts LP 5.25%, 3/15/22	U.S.$		545	$	585,226
Trust F/1401 5.25%, 12/15/24(a)			830		859,050
					1,444,276
					24,906,212
Utility – 1.2%
Electric – 0.8%
CMS Energy Corp. 5.05%, 3/15/22			440		488,203
Constellation Energy Group, Inc. 5.15%, 12/01/20			260		284,206
Entergy Corp. 4.00%, 7/15/22			582		598,136
Exelon Corp. 5.10%, 6/15/45			320		329,357
Exelon Generation Co. LLC 4.25%, 6/15/22			337		343,400
TECO Finance, Inc. 5.15%, 3/15/20			380		414,808
					2,458,110
Natural Gas – 0.4%
Talent Yield Investments Ltd. 4.50%, 4/25/22(a)			1,365		1,423,254
					3,881,364
Total Corporates – Investment Grade (cost $79,965,201)					79,147,201
MORTGAGE PASS-THROUGHS – 16.2%
Agency ARMs – 0.0%
Federal Home Loan Mortgage Corp. Series 2006 2.566%, 1/01/37(b)			67		71,673
Agency Fixed Rate 15-Year – 1.7%
Federal National Mortgage Association 2.50%, 7/01/30-9/01/30			2,245		2,287,448
3.50%, 11/01/30, TBA			3,193		3,371,608
					5,659,056
Agency Fixed Rate 30-Year – 14.5%
Federal Home Loan Mortgage Corp. Gold 4.00%, 1/01/45			3,392		3,663,160
Series 2005 5.50%, 1/01/35			391		440,186
Series 2007 5.50%, 7/01/35			51		57,281

18 •  AB INTERMEDIATE BOND PORTFOLIO

Portfolio of Investments

		Principal Amount (000)			U.S. $ Value
Federal National Mortgage Association 3.50%, 5/01/42-9/01/45	U.S.$		14,000		$	14,717,313
3.50%, 11/01/45, TBA			571			594,331
4.00%, 10/01/44-12/01/44			5,144			5,565,559
4.50%, 11/25/45, TBA			6,312			6,839,644
5.50%, 1/01/35			1,041			1,176,484
Series 2003 5.50%, 4/01/33-7/01/33			379			427,949
Series 2004 5.50%, 4/01/34-11/01/34			218			246,243
Series 2005 5.50%, 2/01/35			163			183,541
Series 2007 5.50%, 8/01/37			711			802,463
Government National Mortgage Association 3.00%, 11/01/45			4,856			4,961,087
3.50%, 12/01/45, TBA			4,865			5,086,966
4.50%, 7/20/45			2,909			3,131,622
Series 1990 9.00%, 12/15/19			– 0	–**		34
Series 1999 8.15%, 9/15/20			48			52,622
						47,946,485
Total Mortgage Pass-Throughs (cost $53,265,226)						53,677,214
ASSET-BACKED SECURITIES – 16.1%
Autos - Fixed Rate – 9.9%
Ally Auto Receivables Trust Series 2015-2, Class A3 1.49%, 11/15/19			824			824,701
Ally Master Owner Trust Series 2014-1, Class A2 1.29%, 1/15/19			1,409			1,409,433
Series 2015-3, Class A 1.63%, 5/15/20			1,226			1,224,042
AmeriCredit Automobile Receivables Trust Series 2011-3, Class D 4.04%, 7/10/17			778			778,174
Series 2013-3, Class A3 0.92%, 4/09/18			760			760,169
Series 2013-4, Class A3 0.96%, 4/09/18			338			338,563
ARI Fleet Lease Trust Series 2014-A, Class A2 0.81%, 11/15/22(a)			212			212,146

AB INTERMEDIATE BOND PORTFOLIO  • 19

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Avis Budget Rental Car Funding AESOP LLC Series 2012-3A, Class A 2.10%, 3/20/19(a)	U.S.$		1,005	$	1,010,289
Series 2014-1A, Class A 2.46%, 7/20/20(a)			1,769		1,793,053
Bank of The West Auto Trust Series 2015-1, Class A3 1.31%, 10/15/19(a)			1,182		1,183,364
California Republic Auto Receivables Trust Series 2014-2, Class A4 1.57%, 12/16/19			546		545,590
Series 2015-2, Class A3 1.31%, 8/15/19			542		538,594
Capital Auto Receivables Asset Trust Series 2014-1, Class B 2.22%, 1/22/19			220		221,564
CarMax Auto Owner Trust Series 2015-4, Class A3 1.56%, 11/16/20			497		496,976
CPS Auto Receivables Trust Series 2013-B, Class A 1.82%, 9/15/20(a)			320		320,009
Series 2014-B, Class A 1.11%, 11/15/18(a)			282		281,664
Drive Auto Receivables Trust Series 2015-BA, Class A2A 0.93%, 12/15/17(a)			461		460,994
Series 2015-CA, Class A2A 1.03%, 2/15/18(a)			382		381,942
Series 2015-DA, Class A2A 1.23%, 6/15/18(a)			494		493,974
Enterprise Fleet Financing LLC Series 2014-1, Class A2 0.87%, 9/20/19(a)			253		253,229
Series 2015-1, Class A2 1.30%, 9/20/20(a)			1,210		1,208,336
Exeter Automobile Receivables Trust Series 2013-1A, Class A 1.29%, 10/16/17(a)			1		519
Series 2014-1A, Class A 1.29%, 5/15/18(a)			98		98,356
Series 2014-2A, Class A 1.06%, 8/15/18(a)			104		104,230
Fifth Third Auto Trust Series 2014-3, Class A4 1.47%, 5/17/21			721		718,804
Flagship Credit Auto Trust Series 2013-1, Class A 1.32%, 4/16/18(a)			65		65,200

20 •  AB INTERMEDIATE BOND PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Ford Credit Auto Lease Trust Series 2014-B, Class A3 0.89%, 9/15/17	U.S.$		644	$	643,913
Ford Credit Auto Owner Trust Series 2012-B, Class A4 1.00%, 9/15/17			523		522,980
Series 2012-D, Class B 1.01%, 5/15/18			440		438,666
Series 2014-2, Class A 2.31%, 4/15/26(a)			322		324,048
Ford Credit Floorplan Master Owner Trust Series 2015-2, Class A1 1.98%, 1/15/22			906		899,861
Ford Credit Floorplan Master Owner Trust A Series 2014-1, Class A1 1.20%, 2/15/19			993		993,261
GM Financial Automobile Leasing Trust Series 2015-1, Class A2 1.10%, 12/20/17			1,149		1,152,033
Series 2015-2, Class A3 1.68%, 12/20/18			1,080		1,079,822
Series 2015-3, Class A3 1.69%, 3/20/19			1,155		1,152,555
GMF Floorplan Owner Revolving Trust Series 2015-1, Class A1 1.65%, 5/15/20(a)			575		572,768
Harley-Davidson Motorcycle Trust Series 2015-1, Class A3 1.41%, 6/15/20			494		494,905
Hertz Vehicle Financing LLC Series 2013-1A, Class A1 1.12%, 8/25/17(a)			880		878,455
Series 2013-1A, Class A2 1.83%, 8/25/19(a)			2,370		2,366,569
Hyundai Auto Lease Securitization Trust Series 2015-A, Class A2 1.00%, 10/16/17(a)			832		832,325
Series 2015-B, Class A3 1.40%, 11/15/18(a)			539		540,250
Mercedes Benz Auto Lease Trust Series 2015-B, Class A3 1.34%, 7/16/18			622		621,976
Nissan Auto Lease Trust Series 2015-A, Class A3 1.40%, 6/15/18			1,001		1,005,331
Santander Drive Auto Receivables Trust Series 2013-4, Class A3 1.11%, 12/15/17			84		83,815
Series 2015-3, Class A2A 1.02%, 9/17/18			578		578,103
Series 2015-4,Class A2A 1.20%, 12/17/18			548		547,551

AB INTERMEDIATE BOND PORTFOLIO  • 21

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
TCF Auto Receivables Owner Trust Series 2015-1A, Class A2 1.02%, 8/15/18(a)	U.S.$		777	$	776,291
Westlake Automobile Receivables Trust Series 2015-3A, Class A2A 1.42%, 5/17/21(a)			557		556,817
					32,786,210
Credit Cards - Fixed Rate – 2.3%
American Express Credit Account Master Trust Series 2014-2, Class A 1.26%, 1/15/20			400		401,413
Barclays Dryrock Issuance Trust Series 2014-3, Class A 2.41%, 7/15/22			1,119		1,148,798
Series 2015-2, Class A 1.56%, 3/15/21			703		707,613
Series 2015-4, Class A 1.72%, 8/16/21			630		629,859
Discover Card Execution Note Trust Series 2015-A2, Class A 1.90%, 10/17/22			1,101		1,099,878
Synchrony Credit Card Master Note Trust Series 2012-2, Class A 2.22%, 1/15/22			1,050		1,063,926
Series 2015-3, Class A 1.74%, 9/15/21			859		858,363
World Financial Network Credit Card Master Trust Series 2012-B, Class A 1.76%, 5/17/21			890		895,292
Series 2013-A, Class A 1.61%, 12/15/21			570		571,089
					7,376,231
Other ABS - Fixed Rate – 1.4%
Ascentium Equipment Receivables LLC Series 2015-2A, Class A1 1.00%, 11/10/16(a)			1,054		1,054,000
CIT Equipment Collateral Series 2013-VT1, Class A3 1.13%, 7/20/20(a)			722		723,521
Series 2014-VT1, Class A2 0.86%, 5/22/17(a)			816		816,004
CNH Equipment Trust Series 2015-A, Class A4 1.85%, 4/15/21			616		616,890
Dell Equipment Finance Trust Series 2015-1, Class A3 1.30%, 3/23/20(a)			388		386,052
Series 2015-2, Class A2A 1.42%, 12/22/17(a)			278		277,988

22 •  AB INTERMEDIATE BOND PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
GE Equipment Small Ticket LLC Series 2014-1A, Class A2 0.59%, 8/24/16(a)	U.S.$		151	$	150,850
SBA Tower Trust 3.156%, 10/15/20(a)			688		687,725
					4,713,030
Autos - Floating Rate – 1.3%
BMW Floorplan Master Owner Trust Series 2015-1A, Class A 0.696%, 7/15/20(a)(b)			997		992,059
GE Dealer Floorplan Master Note Trust Series 2014-1, Class A 0.574%, 7/20/19(b)			537		534,030
Series 2015-1, Class A 0.694%, 1/20/20(b)			1,073		1,065,203
Hertz Fleet Lease Funding LP Series 2013-3, Class A 0.747%, 12/10/27(a)(b)			677		677,807
Navistar Financial Dealer Note Master Trust Series 2014-1, Class A 0.947%, 10/25/19(a)(b)			719		716,317
Volkswagen Credit Auto Master Trust Series 2014-1A, Class A1 0.544%, 7/22/19(a)(b)			340		335,808
					4,321,224
Credit Cards - Floating Rate – 1.0%
Discover Card Execution Note Trust Series 2015-A1, Class A1 0.546%, 8/17/20(b)			964		960,880
First National Master Note Trust Series 2013-2, Class A 0.726%, 10/15/19(b)			882		882,255
World Financial Network Credit Card Master Trust Series 2014-A, Class A 0.576%, 12/15/19(b)			865		865,292
Series 2015-A, Class A 0.676%, 2/15/22(b)			681		678,552
					3,386,979
Home Equity Loans - Floating Rate – 0.2%
Asset Backed Funding Certificates Trust Series 2003-WF1, Class A2 1.322%, 12/25/32(b)			49		47,358
GSAA Trust Series 2006-5, Class 2A3 0.467%, 3/25/36(b)			890		603,973
					651,331

AB INTERMEDIATE BOND PORTFOLIO  • 23

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Home Equity Loans - Fixed Rate – 0.0%
Credit-Based Asset Servicing and Securitization LLC Series 2003-CB1, Class AF 3.95%, 1/25/33	U.S.$		97	$	97,809
Nationstar NIM Ltd. Series 2007-A, Class A 9.79%, 3/25/37(d)(e)			18		– 0	–
					97,809
Total Asset-Backed Securities (cost $53,355,231)					53,332,814
COMMERCIAL MORTGAGE-BACKED SECURITIES – 13.4%
Non-Agency Fixed Rate CMBS – 11.9%
Banc of America Commercial Mortgage Trust Series 2007-4, Class A1A 5.774%, 2/10/51			1,687		1,778,541
Series 2007-5, Class AM 5.772%, 2/10/51			411		430,499
Bear Stearns Commercial Mortgage Securities Trust Series 2006-PW13, Class AJ 5.611%, 9/11/41			538		542,662
BHMS Mortgage Trust Series 2014-ATLS, Class AFX 3.601%, 7/05/33(a)			890		907,869
CGRBS Commercial Mortgage Trust Series 2013-VN05, Class A 3.369%, 3/13/35(a)			1,305		1,333,981
Citigroup Commercial Mortgage Trust Series 2006-C4, Class A1A 5.792%, 3/15/49			278		281,165
Series 2013-GC17, Class D 5.105%, 11/10/46(a)			565		521,845
Series 2015-GC27, Class A5 3.137%, 2/10/48			698		692,666
COBALT CMBS Commercial Mortgage Trust Series 2007-C3, Class A4 5.766%, 5/15/46			611		644,534
Commercial Mortgage Trust Series 2006-C8, Class A1A 5.292%, 12/10/46			1,104		1,139,993
Series 2007-GG9, Class A4 5.444%, 3/10/39			1,881		1,947,691
Series 2007-GG9, Class AM 5.475%, 3/10/39			829		858,011
Series 2013-SFS, Class A1 1.873%, 4/12/35(a)			521		510,235

24 •  AB INTERMEDIATE BOND PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Credit Suisse Commercial Mortgage Trust Series 2007-C3, Class AM 5.699%, 6/15/39	U.S.$		437	$	447,271
CSAIL Commercial Mortgage Trust Series 2015-C3, Class A4 3.718%, 8/15/48			914		949,276
DBUBS Mortgage Trust Series 2011-LC1A, Class E 5.607%, 11/10/46(a)			363		386,691
Extended Stay America Trust Series 2013-ESH7, Class A17 2.295%, 12/05/31(a)			890		887,643
GS Mortgage Securities Corp. II Series 2013-KING, Class A 2.706%, 12/10/27(a)			1,269		1,290,418
GS Mortgage Securities Trust Series 2007-GG10, Class A4 5.795%, 8/10/45			530		554,293
Series 2013-G1, Class A2 3.557%, 4/10/31(a)			766		774,641
JPMorgan Chase Commercial Mortgage Securities Trust Series 2004-LN2, Class A1A 4.838%, 7/15/41(a)			276		274,942
Series 2006-CB15, Class A4 5.814%, 6/12/43			1,970		1,991,165
Series 2006-LDP9, Class AM 5.372%, 5/15/47			356		363,820
Series 2007-CB19, Class AM 5.695%, 2/12/49			470		493,189
Series 2007-LD12, Class A4 5.882%, 2/15/51			1,580		1,644,101
Series 2007-LD12, Class AM 6.009%, 2/15/51			795		843,820
Series 2007-LDPX, Class A1A 5.439%, 1/15/49			2,272		2,363,302
Series 2008-C2, Class A1A 5.998%, 2/12/51			701		750,187
Series 2010-C2, Class A1 2.749%, 11/15/43(a)			244		246,575
Series 2011-C5, Class D 5.323%, 8/15/46(a)			262		272,787
Series 2015-C32, Class C 4.819%, 11/15/48			540		498,169
JPMBB Commercial Mortgage Securities Trust Series 2015-C31, Class A3 3.801%, 8/15/48			964		1,008,160

AB INTERMEDIATE BOND PORTFOLIO  • 25

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
LSTAR Commercial Mortgage Trust Series 2014-2, Class A2 2.767%, 1/20/41(a)	U.S.$		520	$	528,647
Series 2015-3, Class A2 2.729%, 4/20/48(a)			674		677,337
Merrill Lynch Mortgage Trust Series 2006-C2, Class A1A 5.739%, 8/12/43			755		772,437
Merrill Lynch/Countrywide Commercial Mortgage Trust Series 2006-4, Class A1A 5.166%, 12/12/49			1,326		1,366,449
Series 2007-9, Class A4 5.70%, 9/12/49			2,932		3,066,861
Prudential Securities Secured Financing Corp. Series 1999-NRF1, Class AEC 1.282%, 11/01/31(a)(f)(g)			1,344		47
UBS-Barclays Commercial Mortgage Trust Series 2012-C3, Class A4 3.091%, 8/10/49			552		563,525
Series 2012-C4, Class A5 2.85%, 12/10/45			1,098		1,092,784
Wachovia Bank Commercial Mortgage Trust Series 2006-C23, Class A5 5.416%, 1/15/45			1,345		1,348,140
Series 2006-C26, Class A1A 6.009%, 6/15/45			387		393,519
WF-RBS Commercial Mortgage Trust Series 2012-C9, Class D 4.803%, 11/15/45(a)			170		165,536
Series 2013-C14, Class A5 3.337%, 6/15/46			1,142		1,172,247
Series 2014-C20, Class A2 3.036%, 5/15/47			546		563,730
					39,341,401
Non-Agency Floating Rate CMBS – 1.5%
Carefree Portfolio Trust Series 2014-CARE, Class A 1.516%, 11/15/19(a)(b)			490		490,009
Commercial Mortgage Trust Series 2014-KYO, Class A 1.096%, 6/11/27(a)(b)			647		643,699
Series 2014-SAVA, Class A 1.346%, 6/15/34(a)(b)			455		453,375
H/2 Asset Funding NRE Series 2015-1A 1.85%, 6/24/49(a)(b)			639		637,767

26 •  AB INTERMEDIATE BOND PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
JPMorgan Chase Commercial Mortgage Securities Trust Series 2014-INN, Class A 1.116%, 6/15/29(a)(b)	U.S.$		902	$	896,077
PFP III Ltd. Series 2014-1, Class A 1.367%, 6/14/31(a)(b)			205		204,316
Resource Capital Corp., Ltd. Series 2014-CRE2, Class A 1.247%, 4/15/32(a)(b)			383		380,713
Starwood Retail Property Trust Series 2014-STAR, Class A 1.416%, 11/15/27(a)(b)			579		574,445
Wells Fargo Commercial Mortgage Trust Series 2015-SG1, Class C 4.471%, 12/15/47(h)			516		492,491
					4,772,892
Agency CMBS – 0.0%
Government National Mortgage Association Series 2006-39, Class IO 0.099%, 7/16/46(g)(h)			2,416		11,292
Total Commercial Mortgage-Backed Securities (cost $44,900,112)					44,125,585
GOVERNMENTS – TREASURIES – 11.8%
Brazil – 0.3%
Brazil Notas do Tesouro Nacional Series F 10.00%, 1/01/17	BRL		4,630		1,136,239
Canada – 1.0%
Canadian Government Bond 2.25%, 6/01/25	CAD		4,005		3,251,536
United Kingdom – 0.8%
United Kingdom Gilt 3.75%, 9/07/21(a)	GBP		1,461		2,548,588
United States – 9.7%
U.S. Treasury Bonds 2.50%, 2/15/45	U.S.$		1,151		1,048,385
2.875%, 8/15/45			800		790,461
3.00%, 5/15/45			322		325,803
3.125%, 8/15/44			10,677		11,074,161
4.375%, 2/15/38			960		1,227,975
U.S. Treasury Notes 1.375%, 3/31/20-4/30/20			4,908		4,889,315
1.50%, 5/31/19-11/30/19			2,941		2,958,217

AB INTERMEDIATE BOND PORTFOLIO  • 27

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
1.625%, 8/31/19	U.S.$		2,155	$	2,180,086
1.75%, 9/30/19-5/15/22			6,149		6,232,545
2.25%, 11/15/24			1,187		1,199,533
					31,926,481
Total Governments – Treasuries (cost $39,558,085)					38,862,844
CORPORATES – NON-INVESTMENT GRADE – 6.5%
Industrial – 3.8%
Basic – 0.4%
Axalta Coating Systems US Holdings, Inc./Axalta Coating Systems Dutch Holding B 7.375%, 5/01/21(a)			700		740,250
Novelis, Inc. 8.375%, 12/15/17			75		75,562
Teck Resources Ltd. 4.50%, 1/15/21			750		510,000
					1,325,812
Capital Goods – 0.1%
Rexam PLC 6.75%, 6/29/67(a)	EUR		360		395,874
Communications - Media – 0.5%
Arqiva Broadcast Finance PLC 9.50%, 3/31/20(a)	GBP		300		502,369
CSC Holdings LLC 8.625%, 2/15/19	U.S.$		118		125,375
Quebecor Media, Inc. 5.75%, 1/15/23			391		400,775
Unitymedia Hessen GmbH & Co. KG/Unitymedia NRW GmbH 5.50%, 1/15/23(a)			750		770,850
					1,799,369
Communications - Telecommunications – 0.8%
Numericable-SFR SAS 5.375%, 5/15/22(a)	EUR		222		252,667
Sprint Capital Corp. 6.90%, 5/01/19	U.S.$		970		931,200
Wind Acquisition Finance SA 6.50%, 4/30/20(a)			700		738,500
Windstream Services LLC 6.375%, 8/01/23			750		594,375
					2,516,742
Consumer Cyclical - Automotive – 0.1%
Goodyear Tire & Rubber Co. (The) 8.25%, 8/15/20			158		165,268

28 •  AB INTERMEDIATE BOND PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Consumer Cyclical - Other – 0.1%
KB Home 4.75%, 5/15/19	U.S.$		286	$	281,251
MCE Finance Ltd. 5.00%, 2/15/21(a)			235		220,312
					501,563
Consumer Cyclical - Retailers – 0.3%
Cash America International, Inc. 5.75%, 5/15/18			295		297,212
CST Brands, Inc. 5.00%, 5/01/23			470		474,700
Men’s Wearhouse, Inc. (The) 7.00%, 7/01/22			379		394,160
					1,166,072
Consumer Non-Cyclical – 0.5%
First Quality Finance Co., Inc. 4.625%, 5/15/21(a)			475		440,562
Priory Group No 3 PLC 7.00%, 2/15/18(a)	GBP		190		301,273
Valeant Pharmaceuticals International, Inc. 6.125%, 4/15/25(a)	U.S.$		375		315,469
Voyage Care Bondco PLC 6.50%, 8/01/18(a)	GBP		320		503,178
					1,560,482
Energy – 0.5%
Global Partners LP/GLP Finance Corp. 6.25%, 7/15/22	U.S.$		361		332,120
ONEOK, Inc. 4.25%, 2/01/22			877		752,028
SM Energy Co. 6.50%, 1/01/23			35		34,489
Targa Resources Partners LP/Targa Resources Partners Finance Corp. 6.375%, 8/01/22			440		426,800
Transocean, Inc. 6.50%, 11/15/20			355		284,298
					1,829,735
Other Industrial – 0.2%
General Cable Corp. 5.75%, 10/01/22			655		564,938
Technology – 0.3%
Advanced Micro Devices, Inc. 6.75%, 3/01/19			270		207,900
Audatex North America, Inc. 6.00%, 6/15/21(a)			630		634,416
					842,316
					12,668,171

AB INTERMEDIATE BOND PORTFOLIO  • 29

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Financial Institutions – 2.2%
Banking – 2.0%
Bank of America Corp. Series Z 6.50%, 10/23/24(c)	U.S.$		213	$	222,587
Barclays Bank PLC 6.86%, 6/15/32(a)(c)			129		147,705
7.625%, 11/21/22			400		456,750
7.75%, 4/10/23			402		436,673
BNP Paribas SA 7.375%, 8/19/25(a)(c)			330		341,550
Credit Agricole SA 7.875%, 1/23/24(a)(c)			249		255,225
Credit Suisse Group AG 7.50%, 12/11/23(a)(c)			363		382,965
HBOS Capital Funding LP 4.939%, 5/23/16(c)	EUR		910		1,010,689
Intesa Sanpaolo SpA 5.017%, 6/26/24(a)	U.S.$		569		569,917
LBG Capital No.1 PLC 8.00%, 6/15/20(a)(c)			254		285,750
Lloyds Banking Group PLC 7.50%, 6/27/24(c)			402		427,125
Royal Bank of Scotland PLC (The) 9.50%, 3/16/22(a)			1,024		1,117,151
Societe Generale SA 5.922%, 4/05/17(a)(c)			130		132,519
8.00%, 9/29/25(a)(c)			330		334,658
UniCredit Luxembourg Finance SA 6.00%, 10/31/17(a)			563		592,531
					6,713,795
Finance – 0.2%
AerCap Aviation Solutions BV 6.375%, 5/30/17			320		333,600
International Lease Finance Corp. 5.875%, 4/01/19			245		262,868
Navient Corp. 7.25%, 1/25/22			99		97,515
					693,983
					7,407,778
Utility – 0.4%
Electric – 0.4%
AES Corp./VA 7.375%, 7/01/21			580		617,700
NRG Energy, Inc. 7.875%, 5/15/21			595		592,025
					1,209,725

30 •  AB INTERMEDIATE BOND PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Non Corporate Sectors – 0.1%
Agencies - Not Government Guaranteed – 0.1%
NOVA Chemicals Corp. 5.25%, 8/01/23(a)	U.S.$		331	$	338,679
Total Corporates – Non-Investment Grade (cost $22,707,739)					21,624,353
COLLATERALIZED MORTGAGE OBLIGATIONS – 6.3%
GSE Risk Share Floating Rate – 2.8%
Bellemeade Re Ltd. Series 2015-1A, Class M1 2.689%, 7/25/25(a)(b)			476		475,867
Federal Home Loan Mortgage Corp. Structured Agency Credit Risk Debt Notes Series 2013-DN2, Class M2 4.447%, 11/25/23(b)			1,040		1,034,768
Series 2014-DN3, Class M3 4.197%, 8/25/24(b)			870		838,886
Series 2014-DN4, Class M3 4.747%, 10/25/24(b)			300		298,944
Series 2014-HQ3, Class M3 4.947%, 10/25/24(b)			570		568,024
Series 2015-DNA1, Class M3 3.497%, 10/25/27(b)			265		250,045
Series 2015-DNA2, Class M2 2.797%, 12/25/27(b)			1,017		1,015,230
Series 2015-HQ1, Class M2 2.397%, 3/25/25(b)			400		396,671
Series 2015-HQA1, Class M2 2.844%, 3/25/28(b)			735		732,096
Federal National Mortgage Association Connecticut Avenue Securities Series 2014-C03, Class 1M1 1.397%, 7/25/24(b)			232		231,099
Series 2014-C04, Class 1M2 5.097%, 11/25/24(b)			511		512,434
Series 2014-C04, Class 2M2 5.197%, 11/25/24(b)			195		195,966
Series 2015-C01, Class 1M2 4.497%, 2/25/25(b)			355		344,017
Series 2015-C01, Class 2M2 4.747%, 2/25/25(b)			328		321,998
Series 2015-C02, Class 2M2 4.197%, 5/25/25(b)			430		408,734
Series 2015-C03, Class 1M2 5.197%, 7/25/25(b)			180		179,325

AB INTERMEDIATE BOND PORTFOLIO  • 31

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Series 2015-C03, Class 2M2 5.197%, 7/25/25(b)	U.S.$		490	$	489,407
Series 2015-C04, Class 1M2 5.894%, 4/25/28(b)			198		201,224
Series 2015-C04, Class 2M2 5.744%, 4/25/28(b)			304		308,696
Wells Fargo Credit Risk Transfer Securities Trust Series 2015-WF1, Class 1M2 5.447%, 11/25/25(a)(b)			394		391,734
Series 2015-WF1, Class 2M2 5.697%, 11/25/25(a)(b)			105		104,342
					9,299,507
Non-Agency Floating Rate – 1.6%
Chevy Chase Funding LLC Mortgage-Backed Certificates Series 2006-2A, Class A2 0.377%, 4/25/47(a)(b)			527		391,297
Deutsche Alt-A Securities Mortgage Loan Trust Series 2006-AR4, Class A2 0.387%, 12/25/36(b)			957		597,720
HomeBanc Mortgage Trust Series 2005-1, Class A1 0.447%, 3/25/35(b)			445		384,087
Impac Secured Assets CMN Owner Trust Series 2005-2, Class A2D 0.627%, 3/25/36(b)			511		368,083
IndyMac Index Mortgage Loan Trust Series 2006-AR15, Class A1 0.317%, 7/25/36(b)			700		569,956
JPMorgan Chase Commercial Mortgage Securities Trust Series 2015-SGP, Class A 1.896%, 7/15/36(a)(b)			825		824,284
RALI Trust Series 2007-QS4, Class 2A4 0.537%, 3/25/37(b)			920		311,438
RBSSP Resecuritization Trust Series 2010-9, Class 7A6 6.853%, 5/26/37(a)(h)			478		398,356
Residential Accredit Loans, Inc., Trust Series 2007-QO2, Class A1 0.347%, 2/25/47(b)			623		336,346
Washington Mutual Alternative Mortgage Pass-Through Certificates Trust Series 2005-10, Class 2A3 1.097%, 11/25/35(b)			350		250,930

32 •  AB INTERMEDIATE BOND PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Washington Mutual Mortgage Pass-Through Certificates Trust Series 2007-OA1, Class A1A 0.922%, 2/25/47(b)	U.S.$		1,176	$	937,894
					5,370,391
Non-Agency Fixed Rate – 1.6%
Alternative Loan Trust Series 2005-57CB, Class 4A3 5.50%, 12/25/35			325		298,443
Series 2006-23CB, Class 1A7 6.00%, 8/25/36			181		175,808
Series 2006-28CB, Class A14 6.25%, 10/25/36			344		292,402
Series 2006-J1, Class 1A13 5.50%, 2/25/36			309		278,202
Citigroup Mortgage Loan Trust, Inc. Series 2005-2, Class 1A4 2.619%, 5/25/35			633		616,284
Countrywide Alternative Loan Trust Series 2006-24CB, Class A16 5.75%, 6/25/36			496		444,158
Countrywide Home Loan Mortgage Pass-Through Trust Series 2006-13, Class 1A18 6.25%, 9/25/36			386		349,916
Series 2006-13, Class 1A19 6.25%, 9/25/36			139		126,170
Credit Suisse Mortgage Trust Series 2010-6R, Class 3A2 5.875%, 1/26/38(a)			391		328,408
First Horizon Alternative Mortgage Securities Trust Series 2006-FA3, Class A9 6.00%, 7/25/36			537		442,755
JPMorgan Alternative Loan Trust Series 2006-A3, Class 2A1 3.10%, 7/25/36			985		819,548
RBSSP Resecuritization Trust Series 2009-7, Class 10A3 6.00%, 8/26/37(a)			549		469,205
Structured Asset Securities Corp. Mortgage Pass-Through Certificates Series 2002-3, Class B3 6.50%, 3/25/32			628		548,014
					5,189,313

AB INTERMEDIATE BOND PORTFOLIO  • 33

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Agency Fixed Rate – 0.3%
Countrywide Home Loan Mortgage Pass-Through Trust Series 2007-HYB2, Class 3A1 2.621%, 2/25/47	U.S.$		689	$	611,164
Fannie Mae Grantor Trust Series 2004-T5, Class AB4 0.758%, 5/28/35			65		59,876
Federal National Mortgage Association REMICS Series 2010-117, Class DI 4.50%, 5/25/25(g)			2,288		243,986
					915,026
Total Collateralized Mortgage Obligations (cost $21,692,669)					20,774,237
INFLATION-LINKED SECURITIES – 3.3%
United States – 3.3%
U.S. Treasury Inflation Index 0.125%, 4/15/19 (TIPS) (cost $11,185,022)			10,994		10,976,508
QUASI-SOVEREIGNS – 0.9%
Quasi-Sovereign Bonds – 0.9%
Chile – 0.3%
Corp. Nacional del Cobre de Chile 4.50%, 9/16/25(a)			554		549,501
Empresa de Transporte de Pasajeros Metro SA 4.75%, 2/04/24(a)			358		372,827
					922,328
Malaysia – 0.4%
Petronas Capital Ltd. 5.25%, 8/12/19(a)			1,385		1,510,780
Mexico – 0.2%
Petroleos Mexicanos 3.50%, 7/18/18-1/30/23			591		577,594
Total Quasi-Sovereigns (cost $2,865,024)					3,010,702
GOVERNMENTS – SOVEREIGN AGENCIES – 0.6%
Brazil – 0.2%
Petrobras Global Finance BV 5.75%, 1/20/20			672		573,518
Colombia – 0.1%
Ecopetrol SA 5.875%, 5/28/45			245		199,675

34 •  AB INTERMEDIATE BOND PORTFOLIO

Portfolio of Investments

		Principal Amount (000)		U.S. $ Value
Israel – 0.2%
Israel Electric Corp. Ltd. Series 6 5.00%, 11/12/24(a)	U.S.$		580	$	602,098
United Kingdom – 0.1%
Royal Bank of Scotland Group PLC 7.50%, 8/10/20(c)			500		517,500
Total Governments – Sovereign Agencies (cost $1,999,316)					1,892,791
LOCAL GOVERNMENTS – MUNICIPAL BONDS – 0.4%
United States – 0.4%
State of California Series 2010 7.625%, 3/01/40 (cost $1,439,976)			970		1,427,093
		Shares
COMMON STOCKS – 0.4%
Mt Logan Re Ltd. (Preference Shares)(i)(j)			700		743,028
Mt Logan Re Ltd. (Preference Shares)(i)(j)			500		530,735
Total Common Stocks (cost $1,200,000)					1,273,763
PREFERRED STOCKS – 0.2%
Financial Institutions – 0.2%
Insurance – 0.2%
Allstate Corp. (The) 5.10%, 1/15/53 (cost $694,052)			25,975		668,337
		Principal Amount (000)
GOVERNMENTS – SOVEREIGN BONDS – 0.1%
Mexico – 0.1%
Mexico Government International Bond Series E 5.95%, 3/19/19 (cost $234,150)			208		233,896

AB INTERMEDIATE BOND PORTFOLIO  • 35

Portfolio of Investments

			Principal Amount (000)		U.S. $ Value
EMERGING MARKETS – CORPORATE BONDS – 0.1%
Industrial – 0.1%
Communications - Telecommunications – 0.1%
Comcel Trust via Comunicaciones Celulares SA 6.875%, 2/06/24(a)	U.S.$			207	$	165,083
Consumer Non-Cyclical – 0.0%
Virgolino de Oliveira Finance SA 10.50%, 1/28/18(d)(k)				660		8,580
Total Emerging Markets – Corporate Bonds (cost $569,736)						173,663
			Shares
SHORT-TERM INVESTMENTS – 4.5%
Investment Companies – 2.0%
AB Fixed Income Shares, Inc. – Government STIF Portfolio, 0.13%(l)(m) (cost $6,763,382)				6,763,382		6,763,382
			Principal Amount (000)
Governments – Treasuries – 2.5%
Japan – 2.5%
Japan Treasury Discount Bill Series 564 Zero Coupon, 1/25/16 (cost $8,327,484)		JPY		990,000		8,204,300
Total Short-Term Investments (cost $15,090,866)						14,967,682
Total Investments Before Securities Sold Short – 104.7% (cost $350,722,405)						346,168,683

36 •  AB INTERMEDIATE BOND PORTFOLIO

Portfolio of Investments

		Principal Amount (000)			U.S. $ Value
SECURITIES SOLD SHORT – (0.5)%
MORTGAGE PASS-THROUGHS – (0.5)%
Agency Fixed Rate 30-Year – (0.5)%
Federal National Mortgage Association 3.00%, 11/01/45, TBA (cost $(1,773,128))	U.S.$		(1,748	)	$	(1,766,982	)
Total Investments – 104.2% (cost $348,949,277)						344,401,701
Other assets less liabilities – (4.2)%						(13,891,503	)
Net Assets – 100.0%					$	330,510,198

FUTURES (see Note D)

Type	Number of Contracts		Expiration Month		Original Value		Value at October 31, 2015		Unrealized Appreciation/ (Depreciation)
Purchased Contracts
U.S. T-Note 2 Yr (CBT) Futures		61		December 2015	$	13,364,090	$	13,338,031	$	(26,059	)
U.S. T-Note 5 Yr (CBT) Futures		316		December 2015		37,990,164		37,848,407		(141,757	)
U.S. Ultra Bond (CBT) Futures		43		December 2015		6,968,805		6,869,250		(99,555	)
Sold Contracts
Euro-BOBL Futures		90		December 2015		12,680,763		12,808,507		(127,744	)
U.S. T-Note 10 Yr (CBT) Futures		80		December 2015		10,170,029		10,215,000		(44,971	)
									$	(440,086	)

FORWARD CURRENCY EXCHANGE CONTRACTS (see Note D)

Counterparty	Contracts to Deliver (000)			In Exchange For (000)			Settlement Date		Unrealized Appreciation/ (Depreciation)
BNP Paribas SA		USD	1,611		GBP	1,063		11/10/15	$	27,089
Goldman Sachs Bank USA		BRL	4,726		USD	1,225		11/04/15		(746	)
Goldman Sachs Bank USA		USD	1,169		BRL	4,726		11/04/15		56,221
Goldman Sachs Bank USA		TWD	80,662		USD	2,528		12/04/15		44,349
Goldman Sachs Bank USA		BRL	4,862		USD	1,057		1/04/17		(42,634	)
HSBC Bank USA		GBP	3,597		USD	5,529		11/10/15		(16,142	)
HSBC Bank USA		JPY	1,000,000		USD	8,344		11/16/15		55,867
JPMorgan Chase Bank		JPY	595,000		USD	4,990		3/25/16		44,072
Morgan Stanley & Co., Inc.		USD	825		INR	53,760		12/04/15		(7,032	)
Royal Bank of Scotland PLC		CAD	4,146		USD	3,094		11/19/15		(76,734	)
Standard Chartered Bank		BRL	4,726		USD	1,165		11/04/15		(60,314	)
Standard Chartered Bank		USD	1,225		BRL	4,726		11/04/15		746
Standard Chartered Bank		SGD	6,998		USD	4,997		11/06/15		2,211

AB INTERMEDIATE BOND PORTFOLIO  • 37

Portfolio of Investments

Counterparty	Contracts to Deliver (000)			In Exchange For (000)			Settlement Date		Unrealized Appreciation/ (Depreciation)
State Street Bank & Trust Co.		USD	22		GBP	14		11/10/15	$	391
State Street Bank & Trust Co.		EUR	7,296		USD	8,054		12/03/15		27,920
State Street Bank & Trust Co.		USD	4,086		JPY	495,197		12/11/15		19,301
									$	74,565

CURRENCY OPTIONS WRITTEN (see Note D)

Description	Exercise Price		Expiration Date		Contracts (000)		Premiums Received		U.S. $ Value
Call – JPY/USD		JPY    119.300		11/04/15		JPY    495,095	$	9,815	$	(3,245	)

CENTRALLY CLEARED CREDIT DEFAULT SWAPS (see Note D)

Clearing Broker/(Exchange) & Referenced Obligation	Fixed Rate (Pay) Receive			Implied Credit Spread at October 31, 2015			Notional Amount (000)		Market Value			Unrealized Appreciation/ (Depreciation)
Buy Contracts
Morgan Stanley & Co., LLC/(CME Group): CDX-NAHY Series 23, 5 Year Index, 12/20/19*		(5.00	)%		3.09	%	$	1,746	$	(135,257	)	$	(35,961	)

* Termination date

CENTRALLY CLEARED INTEREST RATE SWAPS (see Note D)

						Rate Type
Clearing Broker/ (Exchange)	Notional Amount (000)			Termination Date		Payments made by the Fund	Payments received by the Fund	Unrealized Appreciation/ (Depreciation)
Morgan Stanley & Co., LLC/(CME Group)		CAD	16,500		3/10/17	0.973%	3 Month CDOR	$	(31,440	)
Morgan Stanley & Co., LLC/(CME Group)		AUD	21,860		3/11/17	2.140%	3 Month BBSW		(48,125	)
Morgan Stanley & Co., LLC/(CME Group)		CAD	14,990		6/05/17	1.054%	3 Month CDOR		(48,971	)
Morgan Stanley & Co., LLC/(CME Group)		NZD	29,530		6/09/17	3.366%	3 Month BKBM		(375,985	)
Morgan Stanley & Co., LLC/(CME Group)		AUD	18,850		6/09/17	2.218%	3Month BBSW		(67,029	)
Morgan Stanley & Co., LLC/(CME Group)			13,670		10/30/17	1.915%	3 Month BBSW		(855	)
Morgan Stanley & Co., LLC/(CME Group)		GBP	2,999		6/05/20	6 Month LIBOR	1.651%		63,051
Morgan Stanley & Co., LLC/(CME Group)		$	2,630		1/14/24	2.980%	3 Month LIBOR		(238,666	)
Morgan Stanley & Co., LLC/(CME Group)			2,300		2/14/24	2.889%	3 Month LIBOR		(185,159	)
Morgan Stanley & Co., LLC/(CME Group)		AUD	3,330		3/11/25	6 Month BBSW	2.973%		22,928
Morgan Stanley & Co., LLC/(CME Group)		NZD	3,440		6/09/25	3 Month BKBM	4.068%		136,662

38 •  AB INTERMEDIATE BOND PORTFOLIO

Portfolio of Investments

						Rate Type
Clearing Broker/ (Exchange)	Notional Amount (000)			Termination Date		Payments made by the Fund	Payments received by the Fund	Unrealized Appreciation/ (Depreciation)
Morgan Stanley & Co., LLC/(CME Group)		AUD	2,040		6/09/25	6 Month BBSW	3.384%	$	69,059
Morgan Stanley & Co., LLC/(CME Group)		GBP	510		6/05/45	2.396%	6 Month LIBOR		(51,168	)
								$	(755,698	)

CREDIT DEFAULT SWAPS (see Note D)

Swap Counterparty & Referenced Obligation	Fixed Rate (Pay) Receive			Implied Credit Spread at October 31, 2015			Notional Amount (000)		Market Value		Upfront Premiums Paid (Received)			Unrealized Appreciation/ (Depreciation)
Buy Contracts
Citibank, NA:
Advanced Micro Devices, Inc., 7.75%, 8/01/20, 3/20/19*		(5.00	)%		9.62	%	$	271	$	33,334	$	16,406		$	16,928
Sprint Communications, Inc., 8.375%, 8/15/17, 6/20/19*		(5.00	)		5.90			452		10,457		(20,196	)		30,653
Sprint Communications, Inc., 8.375%, 8/15/17, 6/20/19*		(5.00	)		5.90			518		11,985		(23,998	)		35,983
Sale Contracts
Credit Suisse International:
Anadarko Petroleum Corp., 5.95%, 9/15/16, 9/20/17*		1.00			0.57			1,360		11,817		(18,060	)		29,877
Kohl’s Corp., 6.25% 12/15/17, 6/20/19*		1.00			0.97			61		35		(539	)		574
Kohl’s Corp., 6.25% 12/15/17, 6/20/19*		1.00			0.97			103		58		(1,016	)		1,074
Kohl’s Corp., 6.25% 12/15/17, 6/20/19*		1.00			0.97			42		23		(410	)		433
Kohl’s Corp., 6.25% 12/15/17, 6/20/19*		1.00			0.97			42		23		(412	)		435
									$	67,732	$	(48,225	)	$	115,957

* Termination date

AB INTERMEDIATE BOND PORTFOLIO  • 39

Portfolio of Investments

INFLATION (CPI) SWAPS (see Note D)

Rate Type

Swap Counterparty

Notional Amount (000)

Termination Date

Payments made by the Fund

Payments received by the Fund

Unrealized Appreciation/ (Depreciation)

Barclays Bank PLC

$

5,210

3/04/16

CPI

#

1.170

%

$

19,935

# Variable interest rate based on the rate of inflation as determined by the Consumer Price Index (CPI).

INTEREST RATE SWAPS (see Note D)

					Rate Type
Swap Counterparty	Notional Amount (000)		Termination Date		Payments made by the Fund	Payments received by the Fund	Unrealized Appreciation/ (Depreciation)
JPMorgan Chase Bank, NA	$	5,590		1/30/17	1.059%	3 Month LIBOR	$	(44,990	)
JPMorgan Chase Bank, NA		6,230		2/07/22	2.043%	3 Month LIBOR		(154,153	)
							$	(199,143	)

** Principal amount less than 500.

(a) Security is exempt from registration under Rule 144A of the Securities Act of 1933. These securities are considered liquid and may be resold in transactions exempt from registration, normally to qualified institutional buyers. At October 31, 2015, the aggregate market value of these securities amounted to $73,512,023 or 22.2% of net assets.

(b) Floating Rate Security. Stated interest rate was in effect at October 31, 2015.

(c) Securities are perpetual and, thus, do not have a predetermined maturity date. The date shown, if applicable, reflects the next call date.

(d) Security is exempt from registration under Rule 144A of the Securities Act of 1933. These securities, which represent 0.00% of net assets as of October 31, 2015, are considered illiquid and restricted.

Restricted Securities	Acquisition Date		Cost		Market Value			Percentage of Net Assets
Nationstar NIM Ltd. Series 2007-A, Class A 9.79%, 3/25/37		04/04/07	$	17,606	$	– 0	–		0.00	%
Virgolino de Oliveira Finance SA 10.50%, 1/28/18		1/24/14–1/27/14		365,927		8,580			0.00	%

(e) Fair valued by the Adviser.

(f) Illiquid security.

(g) IO – Interest Only

(h) Variable rate coupon, rate shown as of October 31, 2015.

(i) The security is subject to a 12 month lock-up period, after which semi-annual redemptions are permitted.

(j) Restricted and illiquid security.

Restricted Securities	Acquisition Date		Cost		Market Value		Percentage of Net Assets
Mt Logan Re Ltd. (Preference Shares)		12/30/14	$	700,000	$	743,028		0.22	%
Mt Logan Re Ltd. (Preference Shares)		1/02/14		500,000		530,735		0.16	%

40 •  AB INTERMEDIATE BOND PORTFOLIO

Portfolio of Investments

(k) Security is in default and is non-income producing.

(l) To obtain a copy of the fund’s financial statements, please go to the Securities and Exchange Commission’s website at www.sec.gov, or call AB at (800) 227-4618.

(m) Investment in affiliated money market mutual fund. The rate shown represents the 7-day yield as of period end.

Currency Abbreviations:

AUD – Australian Dollar

BRL – Brazilian Real

CAD – Canadian Dollar

EUR – Euro

GBP – Great British Pound

INR – Indian Rupee

JPY – Japanese Yen

NZD – New Zealand Dollar

SGD – Singapore Dollar

TWD – New Taiwan Dollar

USD – United States Dollar

Glossary:

ABS – Asset-Backed Securities

ARMs – Adjustable Rate Mortgages

BBSW – Bank Bill Swap Reference Rate (Australia)

BKBM – Bank Bill Benchmark (New Zealand)

CBT – Chicago Board of Trade

CDOR – Canadian Dealer Offered Rate

CDX-NAHY – North American High Yield Credit Default Swap Index

CMBS – Commercial Mortgage-Backed Securities

CME – Chicago Mercantile Exchange

GSE – Government-Sponsored Enterprise

LIBOR – London Interbank Offered Rates

REIT – Real Estate Investment Trust

TBA – To Be Announced

TIPS – Treasury Inflation Protected Security

See notes to financial statements.

AB INTERMEDIATE BOND PORTFOLIO  • 41

Portfolio of Investments

STATEMENT OF ASSETS & LIABILITIES

October 31, 2015

Assets
Investments in securities, at value
Unaffiliated issuers (cost $343,959,023)	$	339,405,301
Affiliated issuers (cost $6,763,382)		6,763,382
Cash collateral due from broker		936,156
Foreign currencies, at value (cost $5,065,647)		5,021,081
Receivable for investment securities sold		5,180,124
Interest receivable		1,951,182
Receivable for capital stock sold		598,638
Unrealized appreciation on forward currency exchange contracts		278,167
Unrealized appreciation on credit default swaps		115,957
Receivable for variation margin on exchange-traded derivatives		31,801
Unrealized appreciation on inflation swaps		19,935
Upfront premium paid on credit default swaps		16,406
Receivable from class action settlement proceeds		3,151
Total assets		360,321,281
Liabilities
Due to custodian		1,000,678
Options written, at value (premiums received $9,815)		3,245
Payable for investment securities purchased		25,507,688
Payable for securities sold short, at value (proceeds received $1,773,128)		1,766,982
Payable for capital stock redeemed		557,444
Unrealized depreciation on forward currency exchange contracts		203,602
Unrealized depreciation on interest rate swaps		199,143
Dividends payable		128,942
Distribution fee payable		92,242
Upfront premium received on credit default swaps		64,631
Payable for variation margin on exchange-traded derivatives		37,291
Transfer Agent fee payable		26,170
Advisory fee payable		17,798
Administrative fee payable		13,738
Accrued expenses		191,489
Total liabilities		29,811,083
Net Assets	$	330,510,198
Composition of Net Assets
Capital stock, at par	$	29,892
Additional paid-in capital		332,944,325
Undistributed net investment income		3,040,057
Accumulated net realized gain on investment and foreign currency transactions		298,882
Net unrealized depreciation on investments and foreign currency denominated assets and liabilities		(5,802,958	)
	$	330,510,198

See notes to financial statements.

42 •  AB INTERMEDIATE BOND PORTFOLIO

Statement of Assets & Liabilities

Net Asset Value Per Share—24 billion shares of capital stock authorized, $.001 par value

Class	Net Assets		Shares Outstanding		Net Asset Value
A	$	252,965,111		22,874,736	$	11.06	*
B	$	1,692,410		152,996	$	11.06
C	$	40,928,437		3,707,989	$	11.04
Advisor	$	22,703,876		2,052,032	$	11.06
R	$	2,936,453		265,556	$	11.06
K	$	3,921,684		354,346	$	11.07
I	$	511,109		46,167	$	11.07
Z	$	4,851,118		437,703	$	11.08

* The maximum offering price per share for Class A shares was $11.55 which reflects a sales charge of 4.25%.

See notes to financial statements.

AB INTERMEDIATE BOND PORTFOLIO  • 43

Statement of Assets & Liabilities

STATEMENT OF OPERATIONS

Year Ended October 31, 2015

Investment Income
Interest	$	11,431,004
Dividends
Unaffiliated issuers		91,311
Affiliated issuers		23,258
Other income		4,063		$	11,549,636
Expenses
Advisory fee (see Note B)		1,534,060
Distribution fee—Class A		740,873
Distribution fee—Class B		22,841
Distribution fee—Class C		420,074
Distribution fee—Class R		12,841
Distribution fee—Class K		11,363
Transfer agency—Class A		387,804
Transfer agency—Class B		3,933
Transfer agency—Class C		63,440
Transfer agency—Advisor Class		33,852
Transfer agency—Class R		6,481
Transfer agency—Class K		9,091
Transfer agency—Class I		617
Transfer agency—Class Z		177
Custodian		216,191
Registration fees		116,619
Audit and tax		88,327
Printing		68,759
Administrative		45,081
Legal		38,092
Directors’ fees		18,760
Miscellaneous		19,805
Total expenses		3,859,081
Less: expenses waived and reimbursed by the Adviser (see Note B)		(604,712	)
Net expenses					3,254,369
Net investment income					8,295,267
Realized and Unrealized Gain (Loss) on Investment and Foreign Currency Transactions
Net realized gain on:
Investment transactions					2,579,236
Securities sold short					(4,887	)
Futures					121,615
Swaps					93,827
Foreign currency transactions					2,153,509
Net change in unrealized appreciation/depreciation of:
Investments					(6,897,726	)
Securities sold short					6,146
Futures					(452,329	)
Options written					6,570
Swaps					(708,400	)
Foreign currency denominated assets and liabilities and other assets					(229,171	)
Net loss on investment and foreign currency transactions					(3,331,610	)
Net Increase in Net Assets from Operations				$	4,963,657

See notes to financial statements.

44 •  AB INTERMEDIATE BOND PORTFOLIO

Statement of Operations

STATEMENT OF CHANGES IN NET ASSETS

	Year Ended October 31, 2015			Year Ended October 31, 2014
Increase (Decrease) in Net Assets from Operations
Net investment income	$	8,295,267		$	11,715,490
Net realized gain on investment transactions and foreign currency transactions		4,943,300			17,093,780
Net change in unrealized appreciation/depreciation of investments and foreign currency denominated assets and liabilities and other assets		(8,274,910	)		(9,973,154	)
Net increase in net assets from operations		4,963,657			18,836,116
Dividends to Shareholders from
Net investment income
Class A		(8,137,847	)		(8,778,788	)
Class B		(55,129	)		(97,320	)
Class C		(987,523	)		(1,049,284	)
Advisor Class		(793,874	)		(1,278,019	)
Class R		(71,771	)		(63,907	)
Class K		(140,957	)		(126,092	)
Class I		(14,707	)		(1,625	)
Class Z		(24,900	)		(161	)
Capital Stock Transactions
Net decrease		(17,247,645	)		(88,221,496	)
Total decrease		(22,510,696	)		(80,780,576	)
Net Assets
Beginning of period		353,020,894			433,801,470
End of period (including undistributed net investment income of $3,040,057 and $2,534,258, respectively)	$	330,510,198		$	353,020,894

See notes to financial statements.

AB INTERMEDIATE BOND PORTFOLIO  • 45

Statement of Changes in Net Assets

NOTES TO FINANCIAL STATEMENTS

October 31, 2015

NOTE A

Significant Accounting Policies

AB Bond Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940 as an open-end management investment company. Prior to January 20, 2015, the Fund was known as AllianceBernstein Bond Fund, Inc. The Fund, which is a Maryland corporation, operates as a series company comprised of nine portfolios currently in operation: the AB Intermediate Bond Portfolio, the AB Bond Inflation Strategy Portfolio, the AB Municipal Bond Inflation Strategy Portfolio, the AB All Market Real Return Portfolio (formerly AllianceBernstein Real Asset Strategy), the AB Limited Duration High Income Portfolio, the AB Government Reserves Portfolio, the AB Tax-Aware Fixed Income Portfolio, the AB Credit Long/Short Portfolio and the AB High Yield Portfolio. They are each diversified Portfolios, with the exception of the AB Credit Long/Short Portfolio and the AB High Yield Portfolio, which are non-diversified. Each Portfolio is considered to be a separate entity for financial reporting and tax purposes. This report relates only to the AB Intermediate Bond Portfolio (the “Portfolio”). Prior to January 20, 2015, the Portfolio was known as AllianceBernstein Intermediate Bond Portfolio. The Portfolio offers Class A, Class B, Class C, Advisor Class, Class R, Class K, Class I, and Class Z shares. Class A shares are sold with a front-end sales charge of up to 4.25% for purchases not exceeding $1,000,000. With respect to purchases of $1,000,000 or more, Class A shares redeemed within one year of purchase may be subject to a contingent deferred sales charge of 1%. Class B shares are currently sold with a contingent deferred sales charge which declines from 3% to zero depending on the period of time the shares are held. Effective January 31, 2009, sales of Class B shares of the Portfolio to new investors were suspended. Class B shares will only be issued (i) upon the exchange of Class B shares from another AB Mutual Fund, (ii) for purposes of dividend reinvestment, (iii) through the Portfolio’s Automatic Investment Program (the “Program”) for accounts that established the Program prior to January 31, 2009, and (iv) for purchases of additional shares by Class B shareholders as of January 31, 2009. The ability to establish a new Program for accounts containing Class B shares was suspended as of January 31, 2009. Class B shares will automatically convert to Class A shares six years after the end of the calendar month of purchase. Class C shares are subject to a contingent deferred sales charge of 1% on redemptions made within the first year after purchase. Class R and Class K shares are sold without an initial or contingent deferred sales charge. Advisor Class, Class I and Class Z shares are sold without an initial or contingent deferred sales charge and are not subject to ongoing distribution expenses. All eight classes of shares have identical voting, dividend, liquidation and other rights, except that the classes bear different distribution and transfer agency expenses. Each class has exclusive voting rights with respect to its distribution plan. The financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) which require management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities in the financial

46 •  AB INTERMEDIATE BOND PORTFOLIO

Notes to Financial Statements

statements and amounts of income and expenses during the reporting period. Actual results could differ from those estimates. The Fund is an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. The following is a summary of significant accounting policies followed by the Portfolio.

1. Security Valuation

Portfolio securities are valued at their current market value determined on the basis of market quotations or, if market quotations are not readily available or are deemed unreliable, at “fair value” as determined in accordance with procedures established by and under the general supervision of the Fund’s Board of Directors (the “Board”).

In general, the market values of securities which are readily available and deemed reliable are determined as follows: securities listed on a national securities exchange (other than securities listed on the NASDAQ Stock Market, Inc. (“NASDAQ”)) or on a foreign securities exchange are valued at the last sale price at the close of the exchange or foreign securities exchange. If there has been no sale on such day, the securities are valued at the last traded price from the previous day. Securities listed on more than one exchange are valued by reference to the principal exchange on which the securities are traded; securities listed only on NASDAQ are valued in accordance with the NASDAQ Official Closing Price; listed or over the counter (“OTC”) market put or call options are valued at the mid level between the current bid and ask prices. If either a current bid or current ask price is unavailable, AllianceBernstein L.P. (the “Adviser”) will have discretion to determine the best valuation (e.g. last trade price in the case of listed options); open futures are valued using the closing settlement price or, in the absence of such a price, the most recent quoted bid price. If there are no quotations available for the day of valuation, the last available closing settlement price is used; U.S. Government securities and any other debt instruments having 60 days or less remaining until maturity are generally valued at market by an independent pricing vendor, if a market price is available. If a market price is not available, the securities are valued at amortized cost. This methodology is commonly used for short term securities that have an original maturity of 60 days or less, as well as short term securities that had an original term to maturity that exceeded 60 days. In instances when amortized cost is utilized, the Valuation Committee (the “Committee”) must reasonably conclude that the utilization of amortized cost is approximately the same as the fair value of the security. Such factors the Committee will consider include, but are not limited to, an impairment of the creditworthiness of the issuer or material changes in interest rates. Fixed-income securities, including mortgage-backed and asset-backed securities, may be valued on the basis of prices provided by a pricing service or at a price obtained from one or more of the major broker-dealers. In cases where broker-dealer quotes are obtained, the Adviser may establish procedures whereby changes in market yields or spreads are used to adjust, on a daily

AB INTERMEDIATE BOND PORTFOLIO  • 47

Notes to Financial Statements

basis, a recently obtained quoted price on a security. Swaps and other derivatives are valued daily, primarily using independent pricing services, independent pricing models using market inputs, as well as third party broker-dealers or counterparties. Investment companies are valued at their net asset value each day.

Securities for which market quotations are not readily available (including restricted securities) or are deemed unreliable are valued at fair value. Factors considered in making this determination may include, but are not limited to, information obtained by contacting the issuer, analysts, analysis of the issuer’s financial statements or other available documents. In addition, the Portfolio may use fair value pricing for securities primarily traded in non-U.S. markets because most foreign markets close well before the Portfolio values its securities at 4:00 p.m., Eastern Time. The earlier close of these foreign markets gives rise to the possibility that significant events, including broad market moves, may have occurred in the interim and may materially affect the value of those securities.

2. Fair Value Measurements

In accordance with U.S. GAAP regarding fair value measurements, fair value is defined as the price that the Portfolio would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP establishes a framework for measuring fair value, and a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability (including those valued based on their market values as described in Note A.1 above). Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Portfolio. Unobservable inputs reflect the Portfolio’s own assumptions about the assumptions that market participants would use in pricing the asset or liability based on the best information available in the circumstances. Each investment is assigned a level based upon the observability of the inputs which are significant to the overall valuation. The three-tier hierarchy of inputs is summarized below.

• Level 1—quoted prices in active markets for identical investments

• Level 2—other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

• Level 3—significant unobservable inputs (including the Portfolio’s own assumptions in determining the fair value of investments)

The fair value of debt instruments, such as bonds, and over-the-counter derivatives is generally based on market price quotations, recently executed market transactions (where observable) or industry recognized modeling techniques and are generally classified as Level 2. Pricing vendor inputs to Level 2 valuations may include quoted prices for similar investments in active markets, interest rate curves, coupon rates, currency rates, yield curves, option adjusted

48 •  AB INTERMEDIATE BOND PORTFOLIO

Notes to Financial Statements

spreads, default rates, credit spreads and other unique security features in order to estimate the relevant cash flows which are then discounted to calculate fair values. If these inputs are unobservable and significant to the fair value, these investments will be classified as Level 3. In addition, non-agency rated investments are classified as Level 3.

Options are valued using market-based inputs to models, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency, where such inputs and models are available. Alternatively the values may be obtained through unobservable management determined inputs and/or management’s proprietary models. Where models are used, the selection of a particular model to value an option depends upon the contractual terms of, and specific risks inherent in, the option as well as the availability of pricing information in the market. Valuation models require a variety of inputs, including contractual terms, market prices, measures of volatility and correlations of such inputs. Exchange traded options generally will be classified as Level 2. For options that do not trade on exchange but trade in liquid markets, inputs can generally be verified and model selection does not involve significant management judgment. Options are classified within Level 2 on the fair value hierarchy when all of the significant inputs can be corroborated to market evidence. Otherwise such instruments are classified as Level 3.

Valuations of mortgage-backed or other asset-backed securities, by pricing vendors, are based on both proprietary and industry recognized models and discounted cash flow techniques. Significant inputs to the valuation of these instruments are value of the collateral, the rates and timing of delinquencies, the rates and timing of prepayments, and default and loss expectations, which are driven in part by housing prices for residential mortgages. Significant inputs are determined based on relative value analyses, which incorporate comparisons to instruments with similar collateral and risk profiles, including relevant indices. Mortgage and asset-backed securities for which management has collected current observable data through pricing services are generally categorized within Level 2. Those investments for which current observable data has not been provided are classified as Level 3.

Other fixed income investments, including non-U.S. government and corporate debt, are generally valued using quoted market prices, if available, which are typically impacted by current interest rates, maturity dates and any perceived credit risk of the issuer. Additionally, in the absence of quoted market prices, these inputs are used by pricing vendors to derive a valuation based upon industry or proprietary models which incorporate issuer specific data with relevant yield/spread comparisons with more widely quoted bonds with similar key characteristics. Those investments for which there are observable inputs are classified as Level 2. Where the inputs are not observable, the investments are classified as Level 3.

AB INTERMEDIATE BOND PORTFOLIO  • 49

Notes to Financial Statements

The following table summarizes the valuation of the Portfolio’s investments by the above fair value hierarchy levels as of October 31, 2015:

Investments in Securities:

Level 1

Level 2

Level 3

Total

Assets:

Corporates – Investment Grade

$

– 0

–

$

79,147,201

$

– 0

–

$

79,147,201

Mortgage Pass-Throughs

– 0

–

53,677,214

– 0

–

53,677,214

Asset-Backed Securities

– 0

–

47,870,644

5,462,170

^

53,332,814

Commercial Mortgage-Backed Securities

– 0

–

34,513,102

9,612,483

44,125,585

Governments – Treasuries

– 0

–

38,862,844

– 0

–

38,862,844

Corporates – Non-Investment Grade

– 0

–

21,327,141

297,212

21,624,353

Collateralized Mortgage Obligations

– 0

–

1,128,146

19,646,091

20,774,237

Inflation-Linked Securities

– 0

–

10,976,508

– 0

–

10,976,508

Quasi-Sovereigns

– 0

–

3,010,702

– 0

–

3,010,702

Governments – Sovereign Agencies

– 0

–

1,892,791

– 0

–

1,892,791

Local Governments – Municipal Bonds

– 0

–

1,427,093

– 0

–

1,427,093

Common Stocks

– 0

–

– 0

–

1,273,763

1,273,763

Preferred Stocks

668,337

– 0

–

– 0

–

668,337

Governments – Sovereign Bonds

– 0

–

233,896

– 0

–

233,896

Emerging Markets – Corporate Bonds

– 0

–

173,663

– 0

–

173,663

Short-Term Investments:

Investment Companies

6,763,382

– 0

–

– 0

–

6,763,382

Governments – Treasuries

– 0

–

8,204,300

– 0

–

8,204,300

Liabilities:

Mortgage Pass-Throughs

– 0

–

(1,766,982

)

– 0

–

(1,766,982

)

Total Investments in Securities

7,431,719

300,678,263

36,291,719

344,401,701

Other Financial Instruments*:

Assets:

Forward Currency Exchange Contracts

– 0

–

278,167

– 0

–

278,167

Centrally Cleared Interest Rate Swaps

– 0

–

291,700

– 0

–

291,700

#

Credit Default Swaps

– 0

–

115,957

– 0

–

115,957

Inflation (CPI) Swaps

– 0

–

19,935

– 0

–

19,935

50 •  AB INTERMEDIATE BOND PORTFOLIO

Notes to Financial Statements

Investments in Securities:	Level 1			Level 2			Level 3			Total
Liabilities:
Futures	$	(440,086	)	$	– 0	–	$	– 0	–	$	(440,086	)#
Forward Currency Exchange Contracts		– 0	–		(203,602	)		– 0	–		(203,602	)
Currency Options Written		– 0	–		(3,245	)		– 0	–		(3,245	)
Centrally Cleared Credit Default Swaps		– 0	–		(35,961	)		– 0	–		(35,961	)#
Centrally Cleared Interest Rate Swaps		– 0	–		(1,047,398	)		– 0	–		(1,047,398	)#
Interest Rate Swaps		– 0	–		(199,143	)		– 0	–		(199,143	)
Total+	$	6,991,633		$	299,894,673		$	36,291,719		$	343,178,025

^ The Portfolio held securities with zero market value at period end.

* Other financial instruments are derivative instruments, such as futures, forwards and swaps, which are valued at the unrealized appreciation/depreciation on the instrument. Other financial instruments may also include options written which are valued at market value.

# Only variation margin receivable/payable at period end is reported within the statement of assets and liabilities. This amount reflects cumulative appreciation/(depreciation) of exchange-traded derivatives as reported in the portfolio of investments.

+ There were no transfers between Level 1 and Level 2 during the reporting period.

The Portfolio recognizes all transfers between levels of the fair value hierarchy assuming the financial instruments were transferred at the beginning of the reporting period.

The following is a reconciliation of investments in which significant unobservable inputs (Level 3) were used in determining fair value.

	Asset-Backed Securities^			Commercial Mortgage-Backed Securities			Corporates - Non-Investment Grade
Balance as of 10/31/14	$	3,767,594		$	7,193,928		$	306,800
Accrued discounts/(premiums)		13,166			(12,430	)		1,613
Realized gain (loss)		23,268			(1,089	)		– 0	–
Change in unrealized appreciation/depreciation		(25,368	)		(307,469	)		(11,201	)
Purchases/Payups		3,906,556			2,786,765			– 0	–
Sales/Paydowns		(1,149,222	)		(47,222	)		– 0	–
Settlements		– 0	–		– 0	–		– 0	–
Transfers in to Level 3		– 0	–		– 0	–		– 0	–
Transfers out of Level 3		(1,073,824	)		– 0	–		– 0	–
Balance as of 10/31/15	$	5,462,170		$	9,612,483		$	297,212
Net change in unrealized appreciation/depreciation from investments held as of 10/30/15*	$	(25,368	)	$	(307,469	)	$	(11,201	)

AB INTERMEDIATE BOND PORTFOLIO  • 51

Notes to Financial Statements

	Collateralized Mortgage Obligations			Common Stocks			Cross Currency Swaps
Balance as of 10/31/14	$	14,419,314		$	746,394		$	92,827
Accrued discounts/(premiums)		93,170			– 0	–		– 0	–
Realized gain (loss)		(72,013	)		– 0	–		233,838
Change in unrealized appreciation/depreciation		(76,823	)		27,369			(92,827	)
Purchases/Payups		9,701,496			500,000			– 0	–
Sales/Paydowns		(4,419,053	)		– 0	–		– 0	–
Settlements		– 0	–		– 0	–		(233,838	)
Transfers in to Level 3		– 0	–		– 0	–		– 0	–
Transfers out of Level 3		– 0	–		– 0	–		– 0	–
Balance as of 10/31/15	$	19,646,091		$	1,273,763		$	– 0	–
Net change in unrealized appreciation/depreciation from investments held as of 10/30/15*	$	(95,926	)	$	27,369		$	– 0	–
	Total
Balance as of 10/31/14	$	26,526,857
Accrued discounts/(premiums)		95,519
Realized gain (loss)		184,004
Change in unrealized appreciation/depreciation		(486,319	)
Purchases/Payups		16,894,817
Sales/Paydowns		(5,615,497	)
Settlements		(233,838	)
Transfers in to Level 3		– 0	–
Transfers out of Level 3		(1,073,824	)
Balance as of 10/31/15	$	36,291,719	+
Net change in unrealized appreciation/depreciation from investments held as of 10/30/15*	$	(412,595	)

^ The Portfolio held securities with zero market value at period end.

* The unrealized appreciation/depreciation is included in net change in unrealized appreciation/depreciation on investments and other financial instruments in the accompanying statement of operations.

+ There were de minimis transfers under 1% of net assets during the reporting period.

The following presents information about significant unobservable inputs related to the Portfolio’s Level 3 investments at October 31, 2015. Securities priced i) at net asset value or ii) by third party vendors, are excluded from the following table.

Quantitative Information about Level 3 Fair Value Measurements
	Fair Value at 10/31/15	Valuation Technique	Unobservable Input	Range/ Weighted Average
Asset-Backed Securities	$  – 0 –	Qualitative Assessment		$0.00/N/A

52 •  AB INTERMEDIATE BOND PORTFOLIO

Notes to Financial Statements

The Adviser established the Committee to oversee the pricing and valuation of all securities held in the Portfolio. The Committee operates under pricing and valuation policies and procedures established by the Adviser and approved by the Board, including pricing policies which set forth the mechanisms and processes to be employed on a daily basis to implement these policies and procedures. In particular, the pricing policies describe how to determine market quotations for securities and other instruments. The Committee’s responsibilities include: 1) fair value and liquidity determinations (and oversight of any third parties to whom any responsibility for fair value and liquidity determinations is delegated), and 2) regular monitoring of the Adviser’s pricing and valuation policies and procedures and modification or enhancement of these policies and procedures (or recommendation of the modification of these policies and procedures) as the Committee believes appropriate.

The Committee is also responsible for monitoring the implementation of the pricing policies by the Adviser’s Pricing Group (the “Pricing Group”) and a third party which performs certain pricing functions in accordance with the pricing policies. The Pricing Group is responsible for the oversight of the third party on a day-to-day basis. The Committee and the Pricing Group perform a series of activities to provide reasonable assurance of the accuracy of prices including: 1) periodic vendor due diligence meetings, review of methodologies, new developments and processes at vendors, 2) daily comparison of security valuation versus prior day for all securities that exceeded established thresholds, and 3) daily review of unpriced, stale, and variance reports with exceptions reviewed by senior management and the Committee.

In addition, several processes outside of the pricing process are used to monitor valuation issues including: 1) performance and performance attribution reports are monitored for anomalous impacts based upon benchmark performance, and 2) portfolio managers review all portfolios for performance and analytics (which are generated using the Adviser’s prices).

3. Currency Translation

Assets and liabilities denominated in foreign currencies and commitments under forward currency exchange contracts are translated into U.S. dollars at the mean of the quoted bid and ask prices of such currencies against the U.S. dollar. Purchases and sales of portfolio securities are translated into U.S. dollars at the rates of exchange prevailing when such securities were acquired or sold. Income and expenses are translated into U.S. dollars at rates of exchange prevailing when accrued.

Net realized gain or loss on foreign currency transactions represents foreign exchange gains and losses from sales and maturities of foreign fixed income investments, foreign currency exchange contracts, holding of foreign currencies, currency gains or losses realized between the trade and settlement dates on foreign investment transactions, and the difference between the amounts of dividends,

AB INTERMEDIATE BOND PORTFOLIO  • 53

Notes to Financial Statements

interest and foreign withholding taxes recorded on the Portfolio’s books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized currency gains and losses from valuing foreign currency denominated assets and liabilities at period end exchange rates are reflected as a component of net unrealized appreciation or depreciation of foreign currency denominated assets and liabilities.

4. Taxes

It is the Portfolio’s policy to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its investment company taxable income and net realized gains, if any, to shareholders. Therefore, no provisions for federal income or excise taxes are required. The Portfolio may be subject to taxes imposed by countries in which it invests. Such taxes are generally based on income and/or capital gains earned or repatriated. Taxes are accrued and applied to net investment income, net realized gains and net unrealized appreciation/depreciation as such income and/or gains are earned.

In accordance with U.S. GAAP requirements regarding accounting for uncertainties in income taxes, management has analyzed the Portfolio’s tax positions taken or expected to be taken on federal and state income tax returns for all open tax years (the current and the prior three tax years) and has concluded that no provision for income tax is required in the Portfolio’s financial statements.

5. Investment Income and Investment Transactions

Dividend income (or dividend expense) is recorded on the ex-dividend date or as soon as the Portfolio is informed of the dividend. Interest income (or interest expense) is accrued daily. Investment transactions are accounted for on the date the securities are purchased or sold. Investment gains or losses are determined on the identified cost basis. The Portfolio amortizes premiums and accretes discounts as adjustments to interest income.

6. Class Allocations

All income earned and expenses incurred by the Portfolio are borne on a pro-rata basis by each outstanding class of shares, based on the proportionate interest in the Portfolio represented by the net assets of such class, except for class specific expenses which are allocated to the respective class. Expenses of the Fund are charged proportionately to each Portfolio or based on other appropriate methods. Realized and unrealized gains and losses are allocated among the various share classes based on respective net assets.

7. Dividends and Distributions

Dividends and distributions to shareholders, if any, are recorded on the ex-dividend date. Income dividends and capital gains distributions are determined in accordance with federal tax regulations and may differ from those determined in accordance with U.S. GAAP. To the extent these differences are permanent, such amounts are reclassified within the capital accounts based on their federal tax basis treatment; temporary differences do not require such reclassification.

54 •  AB INTERMEDIATE BOND PORTFOLIO

Notes to Financial Statements

NOTE B

Advisory Fee and Other Transactions with Affiliates

Under the terms of the investment advisory agreement, the Portfolio pays the Adviser an advisory fee at an annual rate of .45% of the first $2.5 billion, .40% of the next $2.5 billion and .35% in excess of $5 billion, of the Portfolio’s average daily net assets. The fee is accrued daily and paid monthly. Effective February 1, 2013 (effective April 28, 2014 for Class Z shares), the Adviser has agreed to waive its fees and bear certain expenses to the extent necessary to limit total operating expenses on an annual basis (the “Expense Caps”) to .90%, 1.60%, 1.60%, .60%, 1.10%, .85%, .60%, and .60% of the daily average net assets for the Class A, Class B, Class C, Advisor Class, Class R, Class K, Class I, and Class Z shares, respectively. Effective June 1, 2015, the expense cap on Class A was reduced to .85%. This waiver extends through January 29, 2016 and then may be extended by the Adviser for additional one year terms. For the year ended October 31, 2015, such reimbursements/waivers amounted to $604,712.

Pursuant to the investment advisory agreement, the Portfolio may reimburse the Adviser for certain legal and accounting services provided to the Portfolio by the Adviser. For the year ended October 31, 2015, the reimbursement for such services amounted to $45,081.

The Portfolio compensates AllianceBernstein Investor Services, Inc. (“ABIS”), a wholly-owned subsidiary of the Adviser, under a Transfer Agency Agreement for providing personnel and facilities to perform transfer agency services for the Portfolio. ABIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. Such compensation retained by ABIS amounted to $234,555 for the year ended October 31, 2015.

AllianceBernstein Investments, Inc. (the “Distributor”), a wholly-owned subsidiary of the Adviser, serves as the distributor of the Portfolio’s shares. The Distributor has advised the Portfolio that it has retained front-end sales charges of $5,543 from the sale of Class A shares and received $2,355, $388 and $2,658 in contingent deferred sales charges imposed upon redemptions by shareholders of Class A, Class B and Class C shares, respectively, for the year ended October 31, 2015.

The Portfolio may invest in the AB Fixed-Income Shares, Inc.—Government STIF Portfolio (“Government STIF Portfolio”), an open-end management investment company managed by the Adviser. The Government STIF Portfolio is offered as a cash management option to mutual funds and other institutional accounts of the Adviser, and is not available for direct purchase by members of the public. The Government STIF Portfolio pays no investment management fees but does bear its own expenses. A summary of the Portfolio’s transactions in

AB INTERMEDIATE BOND PORTFOLIO  • 55

Notes to Financial Statements

shares of the Government STIF Portfolio for the year ended October 31, 2015 is as follows:

Market Value October 31, 2014 (000)		Purchases at Cost (000)		Sales Proceeds (000)		Market Value October 31, 2015 (000)		Dividend Income (000)
$	44,459	$	135,451	$	173,147	$	6,763	$	23

Brokerage commissions paid on investment transactions for the year ended October 31, 2015 amounted to $6,375, of which $0 and $0, respectively, was paid to Sanford C. Bernstein & Co. LLC and Sanford C. Bernstein Limited, affiliates of the Adviser.

NOTE C

Distribution Services Agreement

The Portfolio has adopted a Distribution Services Agreement (the “Agreement”) pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the Agreement, the Portfolio pays distribution and servicing fees to the Distributor at an annual rate of up to .30% of the Portfolio’s average daily net assets attributable to Class A shares, 1% of the Portfolio’s average daily net assets attributable to both Class B and Class C shares, .50% of the Portfolio’s average daily net assets attributable to Class R shares and .25% of the Portfolio’s average daily net assets attributable to Class K shares. Effective June 1, 2015, payments under the Agreement in respect of Class A shares are limited to an annual rate of .25% of Class A shares’ average daily net assets. There are no distribution and servicing fees on the Advisor Class, Class I and Class Z shares. The fees are accrued daily and paid monthly. The Agreement provides that the Distributor will use such payments in their entirety for distribution assistance and promotional activities. Since the commencement of the Portfolio’s operations, the Distributor has incurred expenses in excess of the distribution costs reimbursed by the Portfolio in the amounts of $0, $1,076,984, $122,996, and $54,256 for Class B, Class C, Class R and Class K shares, respectively. While such costs may be recovered from the Portfolio in future periods so long as the Agreement is in effect, the rate of the distribution and servicing fees payable under the Agreement may not be increased without a shareholder vote. In accordance with the Agreement, there is no provision for recovery of unreimbursed distribution costs incurred by the Distributor beyond the current fiscal year for Class A shares. The Agreement also provides that the Adviser may use its own resources to finance the distribution of the Portfolio’s shares.

56 •  AB INTERMEDIATE BOND PORTFOLIO

Notes to Financial Statements

NOTE D

Investment Transactions

Purchases and sales of investment securities (excluding short-term investments) for the year ended October 31, 2015 were as follows:

	Purchases		Sales
Investment securities (excluding U.S. government securities)	$	101,854,126	$	70,834,952
U.S. government securities		610,609,441		632,677,413

The cost of investments for federal income tax purposes, gross unrealized appreciation and unrealized depreciation (excluding futures, foreign currency and swap transactions) are as follows:

Cost	$	350,829,916
Gross unrealized appreciation	$	3,113,644
Gross unrealized depreciation		(7,774,877	)
Net unrealized depreciation	$	(4,661,233	)

1. Derivative Financial Instruments

The Portfolio may use derivatives in an effort to earn income and enhance returns, to replace more traditional direct investments, to obtain exposure to otherwise inaccessible markets (collectively, “investment purposes”), or to hedge or adjust the risk profile of its portfolio.

The principal types of derivatives utilized by the Portfolio, as well as the methods in which they may be used are:

• Futures

The Portfolio may buy or sell futures for investment purposes or for the purpose of hedging its portfolio against adverse effects of potential movements in the market. The Portfolio bears the market risk that arises from changes in the value of these instruments and the imperfect correlation between movements in the price of the futures and movements in the price of the assets, reference rates or indices which they are designed to track. Among other things, the Portfolio may purchase or sell futures for foreign currencies or options thereon for non-hedging purposes as a means of making direct investment in foreign currencies, as described below under “Currency Transactions”.

At the time the Portfolio enters into futures, the Portfolio deposits and maintains as collateral an initial margin with the broker, as required by the exchange on which the transaction is effected. Such amount is shown as cash collateral due from broker on the statement of assets and liabilities. Pursuant to the contract, the Portfolio agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments are known as variation margin and are

AB INTERMEDIATE BOND PORTFOLIO  • 57

Notes to Financial Statements

recorded by the Portfolio as unrealized gains or losses. Risks may arise from the potential inability of a counterparty to meet the terms of the contract. The credit/counterparty risk for exchange-traded futures is generally less than privately negotiated futures, since the clearinghouse, which is the issuer or counterparty to each exchange-traded future, has robust risk mitigation standards, including the requirement to provide initial and variation margin. When the contract is closed, the Portfolio records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the time it was closed.

Use of long futures subjects the Portfolio to risk of loss in excess of the amounts shown on the statement of assets and liabilities, up to the notional value of the futures. Use of short futures subjects the Portfolio to unlimited risk of loss. Under some circumstances, futures exchanges may establish daily limits on the amount that the price of futures can vary from the previous day’s settlement price, which could effectively prevent liquidation of unfavorable positions.

During the year ended October 31, 2015, the Portfolio held futures for hedging and non-hedging purposes.

• Forward Currency Exchange Contracts

The Portfolio may enter into forward currency exchange contracts in order to hedge its exposure to changes in foreign currency exchange rates on its foreign portfolio holdings, to hedge certain firm purchase and sale commitments denominated in foreign currencies and for non-hedging purposes as a means of making direct investments in foreign currencies, as described below under “Currency Transactions”.

A forward currency exchange contract is a commitment to purchase or sell a foreign currency at a future date at a negotiated forward rate. The gain or loss arising from the difference between the original contract and the closing of such contract would be included in net realized gain or loss on foreign currency transactions. Fluctuations in the value of open forward currency exchange contracts are recorded for financial reporting purposes as unrealized appreciation and/or depreciation by the Portfolio. Risks may arise from the potential inability of a counterparty to meet the terms of a contract and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar.

During the year ended October 31, 2015, the Portfolio held forward currency exchange contracts for hedging and non-hedging purposes.

• Option Transactions

For hedging and investment purposes, the Portfolio may purchase and write (sell) put and call options on U.S. and foreign securities, including government securities, and foreign currencies that are traded on U.S. and foreign securities exchanges and over-the-counter markets. Among other

58 •  AB INTERMEDIATE BOND PORTFOLIO

Notes to Financial Statements

things, the Portfolio may use options transactions for non-hedging purposes as a means of making direct investments in foreign currencies, as described below under “Currency Transactions” and may use options strategies involving the purchase and/or writing of various combinations of call and/or put options, for hedging and investment purposes.

The risk associated with purchasing an option is that the Portfolio pays a premium whether or not the option is exercised. Additionally, the Portfolio bears the risk of loss of the premium and change in market value should the counterparty not perform under the contract. Put and call options purchased are accounted for in the same manner as portfolio securities. The cost of securities acquired through the exercise of call options is increased by premiums paid. The proceeds from securities sold through the exercise of put options are decreased by the premiums paid.

When the Portfolio writes an option, the premium received by the Portfolio is recorded as a liability and is subsequently adjusted to the current market value of the option written. Premiums received from written options which expire unexercised are recorded by the Portfolio on the expiration date as realized gains from options written. The difference between the premium received and the amount paid on effecting a closing purchase transaction, including brokerage commissions, is also treated as a realized gain, or if the premium received is less than the amount paid for the closing purchase transaction, as a realized loss. If a call option is exercised, the premium received is added to the proceeds from the sale of the underlying security or currency in determining whether the Portfolio has realized a gain or loss. If a put option is exercised, the premium received reduces the cost basis of the security or currency purchased by the Portfolio. In writing an option, the Portfolio bears the market risk of an unfavorable change in the price of the security or currency underlying the written option. Exercise of an option written by the Portfolio could result in the Portfolio selling or buying a security or currency at a price different from the current market value.

During the year ended October 31, 2015, the Portfolio held purchased options for hedging purposes. During the year ended October 31, 2015, the Portfolio held written options for hedging purposes.

For the year ended October 31, 2015, the Portfolio had the following transactions in written options:

	Number of Contracts			Premiums Received
Options written outstanding as of 10/31/14		– 0	–	$	– 0	–
Options written		495,095			9,815
Options expired		– 0	–		– 0	–
Options bought back		– 0	–		– 0	–
Options exercised		– 0	–		– 0	–
Options written outstanding as of 10/31/15		495,095		$	9,815

AB INTERMEDIATE BOND PORTFOLIO  • 59

Notes to Financial Statements

• Swaps

The Portfolio may enter into swaps to hedge its exposure to interest rates, credit risk, or currencies. The Portfolio may also enter into swaps for non-hedging purposes as a means of gaining market exposures, including by making direct investments in foreign currencies, as described below under “Currency Transactions” or in order to take a “long” or “short” position with respect to an underlying referenced asset described below under “Total Return Swaps”. A swap is an agreement that obligates two parties to exchange a series of cash flows at specified intervals based upon or calculated by reference to changes in specified prices or rates for a specified amount of an underlying asset. The payment flows are usually netted against each other, with the difference being paid by one party to the other. In addition, collateral may be pledged or received by the Portfolio in accordance with the terms of the respective swaps to provide value and recourse to the Portfolio or its counterparties in the event of default, bankruptcy or insolvency by one of the parties to the swap.

Risks may arise as a result of the failure of the counterparty to the swap to comply with the terms of the swap. The loss incurred by the failure of a counterparty is generally limited to the net interim payment to be received by the Portfolio, and/or the termination value at the end of the contract. Therefore, the Portfolio considers the creditworthiness of each counterparty to a swap in evaluating potential counterparty risk. This risk is mitigated by having a netting arrangement between the Portfolio and the counterparty and by the posting of collateral by the counterparty to the Portfolio to cover the Portfolio’s exposure to the counterparty. Additionally, risks may arise from unanticipated movements in interest rates or in the value of the underlying securities. The Portfolio accrues for the interim payments on swaps on a daily basis, with the net amount recorded within unrealized appreciation/depreciation of swaps on the statement of assets and liabilities, where applicable. Once the interim payments are settled in cash, the net amount is recorded as realized gain/(loss) on swaps on the statement of operations, in addition to any realized gain/(loss) recorded upon the termination of swaps. Upfront premiums paid or received are recognized as cost or proceeds on the statement of assets and liabilities and are amortized on a straight line basis over the life of the contract. Amortized upfront premiums are included in net realized gain/(loss) from swaps on the statement of operations. Fluctuations in the value of swaps are recorded as a component of net change in unrealized appreciation/depreciation of swaps on the statement of operations.

Certain standardized swaps, including certain interest rate swaps and credit default swaps, are (or soon will be) subject to mandatory central clearing. Cleared swaps are transacted through futures commission merchants (“FCMs”) that are members of central clearinghouses, with the clearinghouse serving as central counterparty, similar to transactions in

60 •  AB INTERMEDIATE BOND PORTFOLIO

Notes to Financial Statements

futures contracts. Centralized clearing will be required for additional categories of swaps on a phased-in basis based on requirements published by the Securities and Exchange Commission and Commodity Futures Trading Commission.

At the time the Portfolio enters into a centrally cleared swap, the Portfolio deposits and maintains as collateral an initial margin with the broker, as required by the clearinghouse on which the transaction is effected. Such amount is shown as cash collateral due from broker on the statement of assets and liabilities. Pursuant to the contract, the Portfolio agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments are known as variation margin and are recorded by the Portfolio as unrealized gains or losses. Risks may arise from the potential of a counterparty to meet the terms of the contract. The credit/counterparty risk for centrally cleared swaps is generally less than non-centrally cleared swaps, since the clearinghouse, which is the issuer or counterparty to each centrally cleared swap, has robust risk mitigation standards, including the requirement to provide initial and variation margin. When the contract is closed, the Portfolio records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the time it was closed.

Interest Rate Swaps:

The Portfolio is subject to interest rate risk exposure in the normal course of pursuing its investment objectives. Because the Portfolio holds fixed rate bonds, the value of these bonds may decrease if interest rates rise. To help hedge against this risk and to maintain its ability to generate income at prevailing market rates, the Portfolio may enter into interest rate swaps. Interest rate swaps are agreements between two parties to exchange cash flows based on a notional amount. The Portfolio may elect to pay a fixed rate and receive a floating rate, or, receive a fixed rate and pay a floating rate on a notional amount.

In addition, the Portfolio may also enter into interest rate swap transactions to preserve a return or spread on a particular investment or portion of its portfolio, or protecting against an increase in the price of securities the Portfolio anticipates purchasing at a later date. Interest rate swaps involve the exchange by a Portfolio with another party of their respective commitments to pay or receive interest (e.g., an exchange of floating rate payments for fixed rate payments) computed based on a contractually-based principal (or “notional”) amount. Interest rate swaps are entered into on a net basis (i.e., the two payment streams are netted out, with the Portfolio receiving or paying, as the case may be, only the net amount of the two payments).

During the year ended October 31, 2015, the Portfolio held interest rate swaps for hedging and non-hedging purposes.

AB INTERMEDIATE BOND PORTFOLIO  • 61

Notes to Financial Statements

Inflation (CPI) Swaps:

Inflation swap agreements are contracts in which one party agrees to pay the cumulative percentage increase in a price index (the Consumer Price Index with respect to CPI swaps) over the term of the swap (with some lag on the inflation index), and the other pays a compounded fixed rate. Inflation swaps may be used to protect the net asset value, or NAV, of a Portfolio against an unexpected change in the rate of inflation measured by an inflation index since the value of these agreements is expected to increase if unexpected inflation increases.

During the year ended October 31, 2015, the Portfolio held inflation (CPI) swaps for hedging and non-hedging purposes.

Currency Swaps:

The Portfolio may invest in currency swaps for hedging purposes to protect against adverse changes in exchange rates between the U.S. Dollar and other currencies or for non-hedging purposes as a means of making direct investments in foreign currencies, as described below under “Currency Transactions”. Currency swaps involve the individually negotiated exchange by a Portfolio with another party of a series of payments in specified currencies. Actual principal amounts of currencies may be exchanged by the counterparties at the initiation, and again upon the termination, of the transaction. Therefore, the entire principal value of a currency swap is subject to the risk that the swap counterparty will default on its contractual delivery obligations.

During the year ended October 31, 2015, the Portfolio held currency swaps for hedging purposes.

Credit Default Swaps:

The Portfolio may enter into credit default swaps, including to manage its exposure to the market or certain sectors of the market, to reduce its risk exposure to defaults by corporate and sovereign issuers held by the Portfolio, or to create exposure to corporate or sovereign issuers to which it is not otherwise exposed. The Portfolio may purchase credit protection (“Buy Contract”) or provide credit protection (“Sale Contract”) on the referenced obligation of the credit default swap. During the term of the swap, the Portfolio receives/(pays) fixed payments from/(to) the respective counterparty, calculated at the agreed upon rate applied to the notional amount. If the Portfolio is a buyer/(seller) of protection and a credit event occurs, as defined under the terms of the swap, the Portfolio will either (i) receive from the seller/(pay to the buyer) of protection an amount equal to the notional amount of the swap (the “Maximum Payout Amount”) and deliver/(take delivery of) the referenced obligation or (ii) receive/(pay) a net settlement amount in the form of cash or securities equal to the notional amount of the swap less the recovery value of the referenced obligation.

62 •  AB INTERMEDIATE BOND PORTFOLIO

Notes to Financial Statements

In certain circumstances Maximum Payout Amounts may be partially offset by recovery values of the respective referenced obligations, upfront premium received upon entering into the agreement, or net amounts received from settlement of buy protection credit default swaps entered into by the Portfolio for the same reference obligation with the same counterparty. As of October 31, 2015, the Portfolio did not have Buy Contracts outstanding with respect to the same referenced obligation and counterparty for its Sales Contracts outstanding.

Credit default swaps may involve greater risks than if a Portfolio had invested in the referenced obligation directly. Credit default swaps are subject to general market risk, liquidity risk, counterparty risk and credit risk. If the Portfolio is a buyer of protection and no credit event occurs, it will lose the payments it made to its counterparty. If the Portfolio is a seller of protection and a credit event occurs, the value of the referenced obligation received by the Portfolio coupled with the periodic payments previously received, may be less than the Maximum Payout Amount it pays to the buyer, resulting in a net loss to the Portfolio.

During the year ended October 31, 2015, the Portfolio held credit default swaps for hedging and non-hedging purposes.

Implied credit spreads over U.S. Treasuries comparable maturity utilized in determining the market value of credit default swaps on issuers as of period end are disclosed in the portfolio of investments. The implied spreads serve as an indicator of the current status of the payment/performance risk and typically reflect the likelihood of default by the issuer of the referenced obligation. The implied credit spread of a particular reference obligation also reflects the cost of buying/selling protection and may reflect upfront payments required to be made to enter into the agreement. Widening credit spreads typically represent a deterioration of the referenced obligation’s credit soundness and greater likelihood of default or other credit event occurring as defined under the terms of the agreement. A credit spread identified as “Defaulted” indicates a credit event has occurred for the referenced obligation.

The Portfolio typically enters into International Swaps and Derivatives Association, Inc. Master Agreements (“ISDA Master Agreement”) or similar master agreements (collectively, “Master Agreements”) with its derivative contract counterparties in order to, among other things, reduce its credit risk to counterparties. ISDA Master Agreements include provisions for general obligations, representations, collateral and events of default or termination. Under an ISDA Master Agreement, the Portfolio typically may offset with the counterparty certain derivative financial instrument’s payables and/or receivables with collateral held and/or posted and create one single net payment (close-out netting) in the event of default or termination.

AB INTERMEDIATE BOND PORTFOLIO  • 63

Notes to Financial Statements

Various Master Agreements govern the terms of certain transactions with counterparties, including transactions such as derivative transactions, repurchase and reverse repurchase agreements. These Master Agreements typically attempt to reduce the counterparty risk associated with such transactions by specifying credit protection mechanisms and providing standardization that improves legal certainty. Cross-termination provisions under Master Agreements typically provide that a default in connection with one transaction between the Portfolio and a counterparty gives the non-defaulting party the right to terminate any other transactions in place with the defaulting party to create one single net payment due to/due from the defaulting party. In the event of a default by a Master Agreements counterparty, the return of collateral with market value in excess of the Portfolio net liability, held by the defaulting party, may be delayed or denied.

The Portfolio’s Master Agreements may contain provisions for early termination of OTC derivative transactions in the event the net assets of the Portfolio decline below specific levels (“net asset contingent features”). If these levels are triggered, the Portfolio’s counterparty has the right to terminate such transaction and require the Portfolio to pay or receive a settlement amount in connection with the terminated transaction. For additional details, please refer to netting arrangements by counterparty tables below.

At October 31, 2015, the Portfolio had entered into the following derivatives:

	Asset Derivatives				Liability Derivatives
Derivative Type	Statement of Assets and Liabilities Location	Fair Value			Statement of Assets and Liabilities Location	Fair Value
Interest rate contracts	Receivable/ Payable for variation margin on exchange- traded derivatives	$	291,700	*	Receivable/ Payable for variation margin on exchange- traded derivatives	$	1,487,484	*
Credit contracts					Receivable/ Payable for variation margin on exchange- traded derivatives		35,961	*
Foreign exchange contracts	Unrealized appreciation on forward currency exchange contracts		278,167		Unrealized depreciation on forward currency exchange contracts		203,602

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Notes to Financial Statements

	Asset Derivatives			Liability Derivatives
Derivative Type	Statement of Assets and Liabilities Location	Fair Value		Statement of Assets and Liabilities Location	Fair Value
Foreign exchange contracts				Options written, at value	$	3,245
Interest rate contracts				Unrealized depreciation on interest rate swaps		199,143
Interest rate contracts	Unrealized appreciation on inflation swaps	$	19,935
Credit contracts	Unrealized appreciation on credit default swaps		115,957
Total		$	705,759		$	1,929,435

* Only variation margin receivable/payable at period end is reported within the statement of assets and liabilities. This amount reflects cumulative appreciation/(depreciation) of exchange-traded derivatives as reported in the portfolio of investments.

The effect of derivative instruments on the statement of operations for the year ended October 31, 2015:

Derivative Type	Location of Gain or (Loss) on Derivatives	Realized Gain or (Loss) on Derivatives		Change in Unrealized Appreciation or (Depreciation)
Interest rate contracts	Net realized gain (loss) on futures; Net change in unrealized appreciation/depreciation of futures	$	121,615	$	(452,329	)
Foreign exchange contracts	Net realized gain (loss) on foreign currency transactions; Net change in unrealized appreciation/depreciation of foreign currency denominated assets and liabilities		721,251		(205,568	)

AB INTERMEDIATE BOND PORTFOLIO  • 65

Notes to Financial Statements

Derivative Type	Location of Gain or (Loss) on Derivatives	Realized Gain or (Loss) on Derivatives			Change in Unrealized Appreciation or (Depreciation)
Equity contracts	Net realized gain (loss) on investment transactions; Net change in unrealized appreciation/depreciation of investments	$	(26,250	)	$	24,713
Foreign exchange contracts	Net realized gain (loss) on options written; Net change in unrealized appreciation/depreciation of options written		– 0	–		6,570
Interest rate contracts	Net realized gain (loss) on swaps; Net change in unrealized appreciation/depreciation of swaps		(206,408	)		(633,159	)
Foreign exchange contracts	Net realized gain (loss) on swaps; Net change in unrealized appreciation/depreciation of swaps		– 0	–		(92,827	)
Credit contracts	Net realized gain (loss) on swaps; Net change in unrealized appreciation/depreciation of swaps		300,235			17,586
Total		$	910,443		$	(1,335,014	)

The following table represents the average monthly volume of the Portfolio’s derivative transactions during the year ended October 31, 2015:

Futures:
Average original value of buy contracts	$	21,109,246
Average original value of sale contracts	$	21,810,654
Forward Currency Exchange Contracts:
Average principal amount of buy contracts	$	5,981,516
Average principal amount of sale contracts	$	31,863,816
Purchased Options:
Average monthly cost	$	26,250	(a)
Interest Rate Swaps:
Average notional amount	$	15,094,212
Inflation Swaps:
Average notional amount	$	5,210,000	(b)

66 •  AB INTERMEDIATE BOND PORTFOLIO

Notes to Financial Statements

Centrally Cleared Interest Rate Swaps:
Average notional amount	$	50,546,478
Cross Currency Swaps:
Average notional amount	$	1,637,610	(c)
Credit Default Swaps:
Average notional amount of buy contracts	$	1,777,969	(b)
Average notional amount of sale contracts	$	2,059,385
Centrally Cleared Credit Default Swaps:
Average notional amount of buy contracts	$	1,764,000	(d)

^(a)  Positions were open for one month during the year.

^(b)  Positions were open for eight months during the year.

^(c)  Positions were open for three months during the year.

^(d)  Positions were open for eleven months during the year.

For financial reporting purposes, the Portfolio does not offset derivative assets and derivative liabilities that are subject to netting arrangements in the statement of assets and liabilities.

All derivatives held at period end were subject to netting arrangements. The following table presents the Portfolio’s derivative assets and liabilities by counterparty net of amounts available for offset under Master Agreements (“MA”) and net of the related collateral received/pledged by the Portfolio as of October 31, 2015:

Counterparty

Derivative Assets Subject to a MA

Derivative Available for Offset

Cash Collateral Received

Security Collateral Received

Net Amount of Derivatives Assets

Exchange-Traded Derivatives:

Morgan Stanley & Co., LLC**

$

31,801

$

(31,801

)

$

– 0

–

$

– 0

–

$

– 0

–

Total

$

31,801

$

(31,801

)

$

– 0

–

$

– 0

–

$

– 0

–

OTC Derivatives:

Barclays Bank PLC

$

19,935

$

– 0

–

$

– 0

–

$

– 0

–

$

19,935

BNP Paribas SA

27,089

– 0

–

– 0

–

– 0

–

27,089

Citibank, NA

55,776

– 0

–

– 0

–

– 0

–

55,776

Credit Suisse International

11,956

– 0

–

– 0

–

– 0

–

11,956

Goldman Sachs Bank USA

100,570

(43,380

)

– 0

–

– 0

–

57,190

HSBC Bank USA

55,867

(16,142

)

– 0

–

– 0

–

39,725

JPMorgan Chase Bank /JPMorgan Chase Bank, NA

44,072

(44,072

)

– 0

–

– 0

–

– 0

–

Standard Chartered Bank

2,957

(2,957

)

– 0

–

– 0

–

– 0

–

State Street Bank & Trust Co.

47,612

– 0

–

– 0

–

– 0

–

47,612

Total

$

365,834

$

(106,551

)

$

– 0

–

$

– 0

–

$

259,283

^

AB INTERMEDIATE BOND PORTFOLIO  • 67

Notes to Financial Statements

Counterparty	Derivative Liabilities Subject to a MA		Derivative Available for Offset			Cash Collateral Pledged*			Security Collateral Pledged			Net Amount of Derivatives Liabilities
Exchange-Traded Derivatives:
Morgan Stanley & Co., LLC**	$	37,291	$	(31,801	)	$	(5,490	)	$	– 0	–	$	– 0	–
Total	$	37,291	$	(31,801	)	$	(5,490	)	$	– 0	–	$	– 0	–
OTC Derivatives:
Deutsche Bank AG	$	3,245	$	– 0	–	$	– 0	–	$	– 0	–	$	3,245
Goldman Sachs Bank USA		43,380		(43,380	)		– 0	–		– 0	–		– 0	–
HSBC Bank USA		16,142		(16,142	)		– 0	–		– 0	–		– 0	–
JPMorgan Chase Bank /JPMorgan Chase Bank, NA		199,143		(44,072	)		– 0	–		– 0	–		155,071
Morgan Stanley & Co., Inc.		7,032		– 0	–		– 0	–		– 0	–		7,032
Royal Bank of Scotland PLC		76,734		– 0	–		– 0	–		– 0	–		76,734
Standard Chartered Bank		60,314		(2,957	)		– 0	–		– 0	–		57,357
Total	$	405,990	$	(106,551	)	$	– 0	–	$	– 0	–	$	299,439	^

* The actual collateral received/pledged may be more than the amount reported due to overcollateralization.

** Cash has been posted for initial margin requirements for exchange traded derivatives outstanding at October 31, 2015.

^ Net amount represents the net receivable/payable that would be due from/to the counterparty in the event of default or termination. The net amount from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same counterparty.

2. Currency Transactions

The Portfolio may invest in non-U.S. dollar securities on a currency hedged or unhedged basis. The Portfolio may seek investment opportunities by taking long or short positions in currencies through the use of currency-related derivatives, including forward currency exchange contracts, futures and options on futures, swaps, and other options. The Portfolio may enter into transactions for investment opportunities when it anticipates that a foreign currency will appreciate or depreciate in value but securities denominated in that currency are not held by the Portfolio and do not present attractive investment opportunities. Such transactions may also be used when the Adviser believes that it may be more efficient than a direct investment in a foreign currency-denominated security. The Portfolio may also conduct currency exchange contracts on a spot basis (i.e., for cash at the spot rate prevailing in the currency exchange market for buying or selling currencies).

68 •  AB INTERMEDIATE BOND PORTFOLIO

Notes to Financial Statements

3. Short Sales

The Portfolio may sell securities short. A short sale is a transaction in which the Portfolio sells securities it does not own, but has borrowed, in anticipation of a decline in the market price of the securities. The Portfolio is obligated to replace the borrowed securities at their market price at the time of settlement. The Portfolio’s obligation to replace the securities borrowed in connection with a short sale will be fully secured by collateral deposited with the broker. The Portfolio is liable to the buyer for any dividends/interest payable on securities while those securities are in a short position. These dividends/interest are recorded as an expense of the Portfolio. Short sales by the Portfolio involve certain risks and special considerations. Possible losses from short sales differ from losses that could be incurred from a purchase of a security because losses from short sales may be unlimited, whereas losses from purchases cannot exceed the total amount invested.

4. TBA and Dollar Rolls

The Portfolio may invest in TBA mortgage-backed securities. A TBA, or “To Be Announced”, trade represents a contract for the purchase or sale of mortgage-backed securities to be delivered at a future agree-upon date; however, the specific mortgage pool numbers or the number of pools that will be delivered to fulfill the trade obligation or terms of the contract are unknown at the time of the trade. Mortgage pools (including fixed-rate or variable-rate mortgages) guaranteed by the Government National Mortgage Association, or GNMA, the Federal National Mortgage Association, or FNMA, or the Federal Home Loan Mortgage Corporation, or FHLMC, are subsequently allocated to the TBA transactions.

The Portfolio may enter into dollar rolls. Dollar rolls involve sales by the Portfolio of securities for delivery in the current month and the Portfolio’s simultaneously contracting to repurchase substantially similar (same type and coupon) securities on a specified future date. During the roll period, the Portfolio forgoes principal and interest paid on the securities. The Portfolio is compensated by the difference between the current sales price and the lower forward price for the future purchase (often referred to as the “drop”) as well as by the interest earned on the cash proceeds of the initial sale. Dollar rolls involve the risk that the market value of the securities the Portfolio is obligated to repurchase under the agreement may decline below the repurchase price. Dollar rolls are speculative techniques. For the year ended October 31, 2015, the Portfolio earned drop income of $1,045,308 which is included in interest income in the accompanying statement of operations.

5. Reverse Repurchase Agreements

The Portfolio may enter into reverse repurchase transactions (“RVP”) in accordance with the terms of a Master Repurchase Agreement (“MRA”), under which the Portfolio sells securities and agrees to repurchase them at a mutually agreed

AB INTERMEDIATE BOND PORTFOLIO  • 69

Notes to Financial Statements

upon date and price. At the time the Portfolio enters into a reverse repurchase agreement, it will establish a segregated account with the custodian containing liquid assets having a value comparable to the repurchase price. Under the MRA and other Master Agreements, the Portfolio is permitted to offset payables and/or receivables with collateral held and/or posted to the counterparty and create one single net payment due to or from the Portfolio in the event of a default. In the event of a default by a MRA counterparty, the Portfolio may be considered an unsecured creditor with respect to any excess collateral (collateral with a market value in excess of the repurchase price) held by and/or posted to the counterparty, and as such the return of such excess collateral may be delayed or denied. For the year ended October 31, 2015, the Portfolio had no transactions in reverse repurchase agreements.

NOTE E

Capital Stock

Each class consists of 3,000,000,000 authorized shares. Transactions in capital shares for each class were as follows:

	Shares						Amount
	Year Ended October 31, 2015			Year Ended October 31, 2014			Year Ended October 31, 2015			Year Ended October 31, 2014
Class A
Shares sold		1,280,374			933,382		$	14,319,956		$	10,384,000
Shares issued in reinvestment of dividends		530,134			573,909			5,929,136			6,379,324
Shares converted from Class B		123,507			149,844			1,384,960			1,663,533
Shares redeemed		(3,441,024	)		(4,712,407	)		(38,513,706	)		(52,313,975	)
Net decrease		(1,507,009	)		(3,055,272	)	$	(16,879,654	)	$	(33,887,118	)
Class B
Shares sold		29,802			18,189		$	334,102		$	202,388
Shares issued in reinvestment of dividends		4,566			8,122			51,110			90,163
Shares converted to Class A		(123,462	)		(149,785	)		(1,384,960	)		(1,663,533	)
Shares redeemed		(26,313	)		(94,252	)		(293,711	)		(1,044,053	)
Net decrease		(115,407	)		(217,726	)	$	(1,293,459	)	$	(2,415,035	)
Class C
Shares sold		452,832			179,590		$	5,052,767		$	2,000,896
Shares issued in reinvestment of dividends		68,581			73,610			765,443			816,406
Shares redeemed		(619,884	)		(776,478	)		(6,918,148	)		(8,588,355	)
Net decrease		(98,471	)		(523,278	)	$	(1,099,938	)	$	(5,771,053	)

70 •  AB INTERMEDIATE BOND PORTFOLIO

Notes to Financial Statements

	Shares						Amount
	Year Ended October 31, 2015			Year Ended October 31, 2014			Year Ended October 31, 2015			Year Ended October 31, 2014
Advisor Class
Shares sold		1,211,759			2,974,672		$	13,604,515		$	33,468,592
Shares issued in reinvestment of dividends		42,501			93,793			475,348			1,035,070
Shares redeemed		(1,546,249	)		(7,399,876	)		(17,411,766	)		(81,798,132	)
Net decrease		(291,989	)		(4,331,411	)	$	(3,331,903	)	$	(47,294,470	)
Class R
Shares sold		80,356			59,606		$	897,105		$	661,932
Shares issued in reinvestment of dividends		6,409			5,744			71,629			63,862
Shares redeemed		(31,961	)		(58,323	)		(358,491	)		(647,074	)
Net increase		54,804			7,027		$	610,243		$	78,720
Class K
Shares sold		128,694			101,384		$	1,445,071		$	1,121,247
Shares issued in reinvestment of dividends		12,526			11,372			140,230			126,655
Shares redeemed		(188,432	)		(25,439	)		(2,103,890	)		(282,557	)
Net increase (decrease)		(47,212	)		87,317		$	(518,589	)	$	965,345
Class I
Shares sold		70,818			11,353		$	799,450		$	127,276
Shares issued in reinvestment of dividends		1,250			98			13,996			1,097
Shares redeemed		(35,363	)		(3,219	)		(398,713	)		(36,261	)
Net increase		36,705			8,232		$	414,733		$	92,112
Class Z(a)
Shares sold		529,910			897		$	5,886,008		$	10,003
Shares issued in reinvestment of dividends		2,243			– 0	–		24,944			– 0	–
Shares redeemed		(95,347	)		– 0	–		(1,060,030	)		– 0	–
Net increase		436,806			897		$	4,850,922		$	10,003

^(a)  Commenced distribution on April 28, 2014.

NOTE F

Risks Involved in Investing in the Portfolio

Interest Rate Risk and Credit Risk—Interest rate risk is the risk that changes in interest rates will affect the value of the Portfolio’s investments in fixed-income debt securities such as bonds or notes. Increases in interest rates may cause the

AB INTERMEDIATE BOND PORTFOLIO  • 71

Notes to Financial Statements

value of the Portfolio’s investments to decline. Credit risk is the risk that the issuer or guarantor of a debt security, or the counterparty to a derivative contract, will be unable or unwilling to make timely principal and/or interest payments, or to otherwise honor its obligations. The degree of risk for a particular security may be reflected in its credit rating. Credit risk is greater for medium quality and lower-rated securities. Lower-rated debt securities and similar unrated securities (commonly known as “junk bonds”) have speculative elements or are predominantly speculative risks.

Duration Risk—Duration is the measure that relates the expected price volatility of a fixed-income security to changes in interest rates. The duration of a fixed-income security may be shorter than or equal to full maturity of a fixed-income security. Fixed-income securities with longer durations have more risk and will decrease in price as interest rates rise. For example, a fixed-income security with a duration of three years will decrease in value by approximately 3% if interest rates increase by 1%.

Below Investment Grade Securities Risk—Investments in fixed-income securities with lower ratings (commonly known as “junk bonds”) are subject to a higher probability that an issuer will default or fail to meet its payment obligations. These securities may be subject to greater price volatility due to such factors as specific corporate developments, negative perceptions of the junk bond market generally and less secondary market liquidity.

Inflation Risk—This is the risk that the value of assets or income from investments will be less in the future as inflation decreases the value of money. As inflation increases, the value of the Portfolio’s assets can decline as can the value of the Portfolio’s distributions. This risk is significantly greater for fixed-income securities with longer maturities.

Foreign (Non-U.S.) Risk—Investments in securities of non-U.S. issuers may involve more risk than those of U.S. issuers. These securities may fluctuate more widely in price and may be less liquid due to adverse market, economic, political, regulatory or other factors.

Emerging Market Risk—Investments in emerging market countries may have more risk because the markets are less developed and less liquid as well as being subject to increased economic, political, regulatory, or other uncertainties.

Currency Risk— Fluctuations in currency exchange rates may negatively affect the value of the Portfolio’s investments or reduce its returns.

Prepayment Risk—The value of mortgage-related or asset-backed securities may be particularly sensitive to changes in prevailing interest rates. Early payments of principal on some mortgage-related securities may occur during periods of falling mortgage interest rates and expose the Portfolio to a lower rate of return

72 •  AB INTERMEDIATE BOND PORTFOLIO

Notes to Financial Statements

upon reinvestment of principal. Early payments associated with mortgage-related securities cause these securities to experience significantly greater price and yield volatility than is experienced by traditional fixed-income securities. During periods of rising interest rates, a reduction in prepayments may increase the effective life of mortgage-related securities, subjecting them to greater risk of decline in market value in response to rising interest rates. If the life of a mortgage-related security is inaccurately predicted, the Portfolio may not be able to realize the rate of return it expected.

Leverage Risk—When the Portfolio borrows money or otherwise leverages its investments, its performance may be volatile because leverage tends to exaggerate the effect of any increase or decrease in the value of the Portfolio’s investments. The Portfolio may create leverage through the use of reverse repurchase arrangements, forward currency exchange contracts, forward commitments, dollar rolls or futures or by borrowing money. The use of derivative instruments by the Portfolio, such as forwards, futures, options and swaps, may also result in a form of leverage. Leverage may result in higher returns to the Portfolio than if the Portfolio were not leveraged, but may also adversely affect returns, particularly if the market is declining.

Derivatives Risk—The Portfolio may enter into derivative transactions such as forwards, options, futures and swaps. Derivatives may be illiquid, difficult to price, and leveraged so that small changes may produce disproportionate losses for the Portfolio, and subject to counterparty risk to a greater degree than more traditional investments. Derivatives may result in significant losses, including losses that are far greater than the value of the derivatives reflected in the statement of assets and liabilities.

Liquidity Risk—Liquidity risk occurs when certain investments become difficult to purchase or sell. Difficulty in selling less liquid securities may result in sales at disadvantageous prices affecting the value of your investment in the Portfolio. Causes of liquidity risk may include low trading volumes, large positions and heavy redemptions of fund shares. Over recent years, liquidity risk has also increased because the capacity of dealers in the secondary market for fixed-income securities to make markets in these securities has decreased, even as the overall bond market has grown significantly, due to, among other things, structural changes, additional regulatory requirements and capital and risk restraints that have led to reduced inventories. Liquidity risk may be higher in a rising interest rate environment, when the value and liquidity of fixed-income securities generally go down.

Indemnification Risk—In the ordinary course of business, the Portfolio enters into contracts that contain a variety of indemnifications. The Portfolio’s maximum exposure under these arrangements is unknown. However, the Portfolio has not had prior claims or losses pursuant to these indemnification provisions and expects the risk of loss thereunder to be remote. Therefore, the Portfolio has not accrued any liability in connection with these indemnification provisions.

AB INTERMEDIATE BOND PORTFOLIO  • 73

Notes to Financial Statements

NOTE G

Joint Credit Facility

A number of open-end mutual funds managed by the Adviser, including the Portfolio, participate in a $280 million revolving credit facility (the “Facility”) intended to provide short-term financing, if necessary, subject to certain restrictions in connection with abnormal redemption activity. Commitment fees related to the Facility are paid by the participating funds and are included in miscellaneous expenses in the statement of operations. The Portfolio did not utilize the Facility during the year ended October 31, 2015.

NOTE H

Distributions to Shareholders

The tax character of distributions paid during the fiscal years ended October 31, 2015 and October 31, 2014 were as follows:

	2015		2014
Distributions paid from:
Ordinary income	$	10,226,708	$	11,395,196
Total taxable distributions paid	$	10,226,708	$	11,395,196

As of October 31, 2015, the components of accumulated earnings/(deficit) on a tax basis were as follows:

Undistributed ordinary income	$	3,273,994
Accumulated capital and other losses		(116,726	)(a)
Unrealized appreciation/(depreciation)		(5,359,855	)(b)
Total accumulated earnings/(deficit)	$	(2,202,587	)(c)

^(a)  During the fiscal year ended October 31, 2015, the Portfolio utilized $2,128,951 of capital loss carryforwards to offset current year net realized gains. The Portfolio also had $10,356,014 of capital loss carryforwards expire during the fiscal year. As of October 31, 2015, the cumulative deferred loss on straddles was $116,726.

^(b)  The differences between book-basis and tax-basis unrealized appreciation/(depreciation) are attributable primarily to the tax deferral of losses on wash sales, the tax treatment of passive foreign investment companies (PFICs), the difference between book and tax amortization methods for premium, the tax treatment of swaps and Treasury inflation-protected securities, and the realization for tax purposes of gains/losses on certain derivative instruments.

^(c)  The differences between book-basis and tax-basis components of accumulated earnings/(deficit) are attributable primarily to dividends payable and the tax treatment of defaulted securities.

For tax purposes, net capital losses may be carried over to offset future capital gains, if any. Funds are permitted to carry forward capital losses incurred in taxable years beginning after December 22, 2010 for an indefinite period, and such losses will retain their character as either short-term or long-term capital losses. As of October 31, 2015, the Portfolio did not have any capital loss carryforwards.

74 •  AB INTERMEDIATE BOND PORTFOLIO

Notes to Financial Statements

During the current fiscal year, permanent differences primarily due to the tax treatment of swaps and swap clearing fees, reclassifications of foreign currency and paydown gains/losses, the tax treatment of Treasury inflation-protected securities, and the expiration of capital loss carryforwards resulted in a net increase in undistributed net investment income, a net decrease in accumulated net realized loss on investment and foreign currency transactions, and a net decrease in additional paid-in capital. These reclassifications had no effect on net assets.

NOTE I

New Accounting Pronouncement

In May 2015, the Financial Accounting Standards Board issued an Accounting Standards Update (“ASU”), ASU 2015-07, which removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the net asset value per share practical expedient. The ASU also removes the disclosure requirement for investments not valued at net asset value. The ASU is effective for annual periods beginning after December 15, 2015 and interim periods within those annual periods. At this time, management is evaluating the implications of these changes on the financial statements.

NOTE J

Subsequent Events

Management has evaluated subsequent events for possible recognition or disclosure in the financial statements through the date the financial statements are issued. Management has determined that there are no material events that would require disclosure in the Portfolio’s financial statements through this date.

AB INTERMEDIATE BOND PORTFOLIO  • 75

Notes to Financial Statements

FINANCIAL HIGHLIGHTS

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class A
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  11.24			$  11.00			$  11.40			$  11.04			$  10.98
Income From Investment Operations
Net investment income(a)(b)		.28			.35			.26			.26			.37
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(.12	)		.23			(.35	)		.41	#		.07
Contributions from Affiliates		– 0	–		– 0	–		– 0	–		.01	#		– 0	–
Net increase (decrease) in net asset value from operations		.16			.58			(.09	)		.68			.44
Less: Dividends
Dividends from net investment income		(.34	)		(.34	)		(.31	)		(.32	)		(.38	)
Net asset value, end of period		$  11.06			$  11.24			$  11.00			$  11.40			$  11.04
Total Return
Total investment return based on net asset value(c)		1.45	%		5.34	%*		(.81	) %†		6.27	%		4.11	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$252,965			$273,962			$301,764			$370,672			$381,577
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.88	%		.90	%		.89	%		.85	%		.85	%
Expenses, before waivers/reimbursements		1.06	%		1.06	%		1.02	%		.99	%		1.00	%
Net investment income(b)		2.51	%		3.15	%		2.32	%		2.29	%		3.42	%
Portfolio turnover rate**		198	%		221	%		189	%		110	%		115	%

See footnote summary on page 83.

76 •  AB INTERMEDIATE BOND PORTFOLIO

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class B
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  11.24			$  11.00			$  11.41			$  11.05			$  10.98
Income From Investment Operations
Net investment income(a)(b)		.20			.28			.18			.18			.30
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(.12	)		.22			(.36	)		.42	#		.08
Contributions from Affiliates		– 0	–		– 0	–		– 0	–		.01	#		– 0	–
Net increase (decrease) in net asset value from operations		.08			.50			(.18	)		.61			.38
Less: Dividends
Dividends from net investment income		(.26	)		(.26	)		(.23	)		(.25	)		(.31	)
Net asset value, end of period		$  11.06			$  11.24			$  11.00			$  11.41			$  11.05
Total Return
Total investment return based on net asset value(c)		.72	%		4.61	%*		(1.59	)%†		5.56	%		3.50	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$1,692			$3,017			$5,348			$9,089			$11,104
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		1.60	%		1.60	%		1.58	%		1.55	%		1.55	%
Expenses, before waivers/reimbursements		1.80	%		1.78	%		1.74	%		1.74	%		1.75	%
Net investment income(b)		1.77	%		2.48	%		1.59	%		1.59	%		2.73	%
Portfolio turnover rate**		198	%		221	%		189	%		110	%		115	%

See footnote summary on page 83.

AB INTERMEDIATE BOND PORTFOLIO  • 77

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class C
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  11.22			$  10.98			$  11.38			$  11.02			$  10.96
Income From Investment Operations
Net investment income(a)(b)		.20			.27			.18			.18			.29
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(.12	)		.23			(.35	)		.41	#		.07
Contributions from Affiliates		– 0	–		– 0	–		– 0	–		.01	#		– 0	–
Net increase (decrease) in net asset value from operations		.08			.50			(.17	)		.60			.36
Less: Dividends
Dividends from net investment income		(.26	)		(.26	)		(.23	)		(.24	)		(.30	)
Net asset value, end of period		$  11.04			$  11.22			$  10.98			$  11.38			$  11.02
Total Return
Total investment return based on net asset value(c)		.73	%		4.63	%*		(1.51	)%†		5.55	%		3.40	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$40,928			$42,690			$47,530			$61,224			$62,147
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		1.60	%		1.60	%		1.59	%		1.55	%		1.55	%
Expenses, before waivers/reimbursements		1.78	%		1.77	%		1.73	%		1.70	%		1.71	%
Net investment income(b)		1.79	%		2.46	%		1.62	%		1.60	%		2.72	%
Portfolio turnover rate**		198	%		221	%		189	%		110	%		115	%

See footnote summary on page 83.

78 •  AB INTERMEDIATE BOND PORTFOLIO

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Advisor Class
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  11.24			$  11.00			$  11.41			$  11.05			$  10.99
Income From Investment Operations
Net investment income(a)(b)		.31			.39			.29			.29			.40
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(.12	)		.22			(.36	)		.41	#		.07
Contributions from Affiliates		– 0	–		– 0	–		– 0	–		.01	#		– 0	–
Net increase (decrease) in net asset value from operations		.19			.61			(.07	)		.71			.47
Less: Dividends
Dividends from net investment income		(.37	)		(.37	)		(.34	)		(.35	)		(.41	)
Net asset value, end of period		$  11.06			$  11.24			$  11.00			$  11.41			$  11.05
Total Return
Total investment return based on net asset value(c)		1.73	%		5.65	%*		(.61	)%†		6.59	%		4.43	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$22,705			$26,352			$73,445			$94,584			$88,402
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.60	%		.60	%		.59	%		.55	%		.55	%
Expenses, before waivers/reimbursements		.77	%		.75	%		.72	%		.69	%		.70	%
Net investment income(b)		2.78	%		3.51	%		2.60	%		2.59	%		3.70	%
Portfolio turnover rate**		198	%		221	%		189	%		110	%		115	%

See footnote summary on page 83.

AB INTERMEDIATE BOND PORTFOLIO  • 79

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class R
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  11.24			$  11.00			$  11.40			$  11.04			$  10.98
Income From Investment Operations
Net investment income(a)(b)		.26			.33			.24			.23			.34
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(.12	)		.23			(.36	)		.42	#		.08
Contributions from Affiliates		– 0	–		– 0	–		– 0	–		.01	#		– 0	–
Net increase (decrease) in net asset value from operations		.14			.56			(.12	)		.66			.42
Less: Dividends
Dividends from net investment income		(.32	)		(.32	)		(.28	)		(.30	)		(.36	)
Net asset value, end of period		$  11.06			$  11.24			$  11.00			$  11.40			$  11.04
Total Return
Total investment return based on net asset value(c)		1.23	%		5.13	%*		(1.01	)%†		6.05	%		3.91	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$2,936			$2,368			$2,241			$1,568			$1,168
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		1.10	%		1.10	%		1.09	%		1.05	%		1.05	%
Expenses, before waivers/reimbursements		1.38	%		1.36	%		1.31	%		1.29	%		1.31	%
Net investment income(b)		2.29	%		2.94	%		2.13	%		2.07	%		3.16	%
Portfolio turnover rate**		198	%		221	%		189	%		110	%		115	%

See footnote summary on page 83.

80 •  AB INTERMEDIATE BOND PORTFOLIO

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class K
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  11.24			$  11.01			$  11.41			$  11.05			$  10.99
Income From Investment Operations
Net investment income(a)(b)		.28			.35			.27			.26			.38
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(.10	)		.22			(.36	)		.42	#		.07
Contributions from Affiliates		– 0	–		– 0	–		– 0	–		.01	#		– 0	–
Net increase (decrease) in net asset value from operations		.18			.57			(.09	)		.69			.45
Less: Dividends
Dividends from net investment income		(.35	)		(.34	)		(.31	)		(.33	)		(.39	)
Net asset value, end of period		$  11.07			$  11.24			$  11.01			$  11.41			$  11.05
Total Return
Total investment return based on net asset value(c)		1.57	%		5.30	%*		(.76	) %†		6.32	%		4.17	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$3,922			$4,515			$3,459			$3,823			$2,869
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.85	%		.85	%		.84	%		.80	%		.80	%
Expenses, before waivers/reimbursements		1.08	%		1.03	%		.93	%		.99	%		1.01	%
Net investment income(b)		2.53	%		3.17	%		2.38	%		2.34	%		3.49	%
Portfolio turnover rate**		198	%		221	%		189	%		110	%		115	%

See footnote summary on page 83.

AB INTERMEDIATE BOND PORTFOLIO  • 81

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class I
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  11.25			$  11.01			$  11.42			$  11.06			$  11.00
Income From Investment Operations
Net investment income(a)(b)		.31			.36			.18			.29			.42
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(.12	)		.25			(.25	)		.41	#		.05
Contributions from Affiliates		– 0	–		– 0	–		– 0	–		.01	#		– 0	–
Net increase (decrease) in net asset value from operations		.19			.61			(.07	)		.71			.47
Less: Dividends
Dividends from net investment income		(.37	)		(.37	)		(.34	)		(.35	)		(.41	)
Net asset value, end of period		$  11.07			$  11.25			$  11.01			$  11.42			$  11.06
Total Return
Total investment return based on net asset value(c)		1.73	%		5.65	%*		(.62	) %†		6.58	%		4.42	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$511			$107			$14			$814			$715
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.60	%		.60	%		.56	%		.55	%		.55	%
Expenses, before waivers/reimbursements		.75	%		.75	%		.67	%		.66	%		.68	%
Net investment income(b)		2.74	%		3.22	%		2.46	%		2.59	%		3.76	%
Portfolio turnover rate**		198	%		221	%		189	%		110	%		115	%

See footnote summary on page 83.

82 •  AB INTERMEDIATE BOND PORTFOLIO

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class Z
	Year Ended October 31, 2015			April 28, 2014(d) to October 31, 2014
Net asset value, beginning of period		$  11.26			$  11.15
Income From Investment Operations
Net investment income(a)(b)		.32			.19
Net realized and unrealized gain (loss) on investment and foreign currency transactions		(.13	)		.10
Net increase in net asset value from operations		.19			.29
Less: Dividends
Dividends from net investment income		(.37	)		(.18	)
Total dividends and distributions		(.37	)		(.18	)
Net asset value, end of period		$  11.08			$  11.26
Total Return
Total investment return based on net asset value(c)		1.72	%		2.61	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$4,851			$10
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.60	%		.60	%^
Expenses, before waivers/reimbursements		.71	%		.66	%^
Net investment income(b)		2.91	%		3.29	%^
Portfolio turnover rate**		198	%		221	%

(a) Based on average shares outstanding.

(b) Net of fees waived and expenses reimbursed by the Adviser.

(c) Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Initial sales charges or contingent deferred sales charges are not reflected in the calculation of total investment return. Total return does not reflect the deduction of taxes that a shareholder would pay on portfolio distributions or the redemption of portfolio shares. Total investment return calculated for a period of less than one year is not annualized.

(d) Commencement of distribution.

# Amount reclassified from realized gain (loss) on investment transactions.

* Includes the impact of proceeds received and credited to the Portfolio resulting from class action settlements, which enhanced the Portfolio’s performance for the year ended October 31, 2014 by 0.01% .

† Includes the impact of proceeds received and credited to the Portfolio resulting from third party regulatory settlements, which enhanced the Portfolio’s performance for the year ended October 31, 2013 by 0.14%.

Includes the Adviser’s reimbursement in respect of the Lehman Bankruptcy Claim which contributed to the Portfolio’s performance by 0.07% for the year-ended October 31, 2012.

^ Annualized.

** The Portfolio accounts for dollar roll transactions as purchases and sales.

See notes to financial statements.

AB INTERMEDIATE BOND PORTFOLIO  • 83

Financial Highlights

REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

To the Board of Directors of AB Bond Fund, Inc. and the

Shareholders of AB Intermediate Bond Portfolio

We have audited the accompanying statement of assets and liabilities, including the portfolio of investments, of AB Intermediate Bond Portfolio (the “Fund”), formerly known as AllianceBernstein Intermediate Bond Portfolio (one of the portfolios constituting the AB Bond Fund, Inc., formerly known as AllianceBernstein Bond Fund, Inc.), as of October 31, 2015, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the periods presented therein. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Fund’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of October 31, 2015, by correspondence with the custodian and others, or by other appropriate auditing procedures where replies from others were not received. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of AB Intermediate Bond Portfolio (one of the portfolios constituting the AB Bond Fund, Inc.) at October 31, 2015, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the periods presented therein, in conformity with U.S. generally accepted accounting principles.

New York, New York

December 30, 2015

84 •  AB INTERMEDIATE BOND PORTFOLIO

Report of Independent Registered Public Accounting Firm

2015 FEDERAL TAX INFORMATION

(unaudited)

For Federal income tax purposes, the following information is furnished with respect to the distributions paid by the Portfolio during the taxable year ended October 31, 2015.

For foreign shareholders, 57.90% of ordinary income dividends paid may be considered to be qualifying to be taxed as interest-related dividends.

Shareholders should not use the above information to prepare their income tax returns. The information necessary to complete your income tax returns will be included with your Form 1099-DIV which will be sent to you separately in January 2016.

AB INTERMEDIATE BOND PORTFOLIO  • 85

BOARD OF DIRECTORS

Marshall C. Turner, Jr.⁽¹⁾, Chairman John H. Dobkin⁽¹⁾ Michael J. Downey⁽¹⁾ William H. Foulk, Jr.⁽¹⁾ D. James Guzy⁽¹⁾ Nancy P. Jacklin⁽¹⁾ Robert M. Keith, President and Chief Executive Officer Garry L. Moody⁽¹⁾ Earl D. Weiner⁽¹⁾

OFFICERS

Philip L. Kirstein, Senior Vice President and Independent Compliance Officer Paul J. DeNoon⁽²⁾, Vice President Shawn E. Keegan⁽²⁾, Vice President Alison M. Martier⁽²⁾ , Vice President Douglas J. Peebles⁽²⁾, Vice President Greg J. Wilensky⁽²⁾, Vice President Emilie D. Wrapp, Secretary Joseph J. Mantineo, Treasurer and Chief Financial Officer Phyllis J. Clarke, Controller Vincent S. Noto, Chief Compliance Officer

Custodian and Accounting Agent State Street Bank and Trust Company State Street Corporation CCB/5 1 Iron Street Boston, MA 02210   Principal Underwriter AllianceBernstein Investments, Inc. 1345 Avenue of the Americas New York, NY 10105   Transfer Agent AllianceBernstein Investor Services, Inc. P.O. Box 786003 San Antonio, TX 78278-6003 Toll-Free (800) 221-5672 Independent Registered Public
Accounting Firm Ernst & Young LLP 5 Times Square New York, NY 10036   Legal Counsel Seward & Kissel LLP One Battery Park Plaza New York, NY 10004

(1) Member of the Audit Committee, the Governance and Nominating Committee, and the Independent Directors Committee.

(2) The day-to-day management of, and investment decisions for, the Fund’s portfolio are made by the Adviser’s U.S. Investment Grade Core Fixed Income Team.
Mr. Paul J. DeNoon, Mr. Shawn E. Keegan, Ms. Alison M. Martier, Mr. Douglas J. Peebles and Mr. Greg J. Wilensky are the investment professionals with the most significant responsibility for the day-to-day management of the Fund’s portfolio.

86 •  AB INTERMEDIATE BOND PORTFOLIO

Board of Directors

MANAGEMENT OF THE FUND

Board of Directors Information

The business and affairs of the Fund are managed under the direction of the Board of Directors. Certain information concerning the Fund’s Directors is set forth below.

NAME, ADDRESS* AND AGE (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
INTERESTED DIRECTOR
Robert M. Keith, + 1345 Avenue of the Americas New York, NY 10105 55 (2010)	Senior Vice President of AllianceBernstein L.P. (the “Adviser”) and head of AllianceBernstein Investments, Inc. (“ABI”) since July 2008; Director of ABI and President of the AB Mutual Funds. Previously, he served as Executive Managing Director of ABI from December 2006 to June 2008. Prior to joining ABI in 2006, Executive Managing Director of Bernstein Global Wealth Management, and prior thereto, Senior Managing Director and Global Head of Client Service and Sales of the Adviser’s institutional investment management business since 2004. Prior thereto, he was Managing Director and Head of North American Client Service and Sales in the Adviser’s institutional investment management business, with which he had been associated since prior to 2004.		110	None

AB INTERMEDIATE BOND PORTFOLIO  • 87

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS
Marshall C. Turner, Jr., # Chairman of the Board 74 (2005)	Private Investor since prior to 2010. Former Chairman and CEO of Dupont Photomasks, Inc. (components of semi-conductor manufacturing). He has extensive operating leadership and venture capital investing experience, including five interim or full-time CEO roles, and prior service as general partner of institutional venture capital partnerships. He also has extensive non-profit board leadership experience, and currently serves on the boards of two education and science-related non-profit organizations. He has served as a director of one AB fund since 1992, and director or trustee of multiple AB Funds since 2005. He has been Chairman of the AB Funds since January 2014, and the Chairman of the Independent Directors Committees of such Funds since February 2014.		110	Xilinx, Inc. (programmable logic semi-conductors) since 2007
John H. Dobkin, # 73 (1998)	Independent Consultant since prior to 2010. Formerly, President of Save Venice, Inc. (preservation organization) from 2001-2002; Senior Advisor from June 1999-June 2000 and President of Historic Hudson Valley (historic preservation) from December 1989-May 1999. Previously, Director of the National Academy of Design. He has served as a director or trustee of various AB Funds since 1992, and as Chairman of the Audit Committees of a number of such Funds from 2001-2008.		110	None

88 •  AB INTERMEDIATE BOND PORTFOLIO

Management of the Fund,

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
Michael J. Downey, # 71 (2005)	Private Investor since prior to 2010. Formerly, managing partner of Lexington Capital, LLC (investment advisory firm) from December 1997 until December 2003. He served as Director of The Merger Fund (registered investment company) since prior to 2010 until 2013. He served as a Director of Prospect Acquisition Corp. (financial services) from 2007 until 2009. From 1987 until 1993, Chairman and CEO of Prudential Mutual Fund Management, director of the Prudential mutual funds, and member of the Executive Committee of Prudential Securities Inc. He has served as a director or trustee of the AB Funds since 2005 and is a director and Chairman of one other registered investment company.		110	Asia Pacific Fund, Inc. (registered investment company) since prior to 2010
William H. Foulk, Jr., # 83 (1998)	Investment Adviser and an Independent Consultant since prior to 2010. Previously, he was Senior Manager of Barrett Associates, Inc., a registered investment adviser. He was formerly Deputy Comptroller and Chief Investment Officer of the State of New York and, prior thereto, Chief Investment Officer of the New York Bank for Savings. He has served as a director or trustee of various AB Funds since 1983, and was Chairman of the Independent Directors Committees of the AB Funds from 2003 until early February 2014. He served as Chairman of such Funds from 2003 through December 2013. He is also active in a number of mutual fund related organizations and committees.		110	None

AB INTERMEDIATE BOND PORTFOLIO  • 89

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
D. James Guzy, # 79 (2005)	Chairman of the Board of SRC Computers, Inc. (semi-conductors), with which he has been associated since prior to 2010. He served as Chairman of the Board of PLX Technology (semi-conductors) since prior to 2010 until November 2013. He was a Director of Cirrus Logic Corporation (semi-conductors) from 1984 until July 2011. He was a director of Intel Corporation (semi-conductors) from 1969 until 2008, and served as Chairman of the Finance Committee of such company for several years until May 2008. He has served as a director or trustee of one or more of the AB Funds since 1982.		110	None
Nancy P. Jacklin, # 67 (2006)	Professorial Lecturer at the Johns Hopkins School of Advanced International Studies (2008-2015). U.S. Executive Director of the International Monetary Fund (which is responsible for ensuring the stability of the international monetary system), (December 2002-May 2006); Partner, Clifford Chance (1992-2002); Sector Counsel, International Banking and Finance, and Associate General Counsel, Citicorp (1985-1992); Assistant General Counsel (International), Federal Reserve Board of Governors (1982-1985); and Attorney Advisor, U.S. Department of the Treasury (1973-1982). Member of the Bar of the District of Columbia and of New York; and member of the Council on Foreign Relations. She has served as a director or trustee of the AB Funds since 2006 and has been Chairman of the Governance and Nominating Committees of the Funds since August 2014.		110	None

90 •  AB INTERMEDIATE BOND PORTFOLIO

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
Garry L. Moody, # 63 (2008)	Independent Consultant. Formerly, Partner, Deloitte & Touche LLP (1995-2008) where he held a number of senior positions, including Vice Chairman, and U.S. and Global Investment Management Practice Managing Partner; President, Fidelity Accounting and Custody Services Company (1993-1995); and Partner, Ernst & Young LLP (1975-1993), where he served as the National Director of Mutual Fund Tax Services and Managing Partner of its Chicago Office Tax department. He is a member of the Trustee Advisory Board of BoardIQ, a biweekly publication focused on issues and news affecting directors of mutual funds. He has served as a director or trustee, and as Chairman of the Audit Committees, of the AB Funds since 2008.		110	None

AB INTERMEDIATE BOND PORTFOLIO  • 91

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
Earl D. Weiner, # 76 (2007)	Of Counsel, and Partner prior to January 2007, of the law firm Sullivan & Cromwell LLP and is a former member of the ABA Federal Regulation of Securities Committee Task Force to draft editions of the Fund Director’s Guidebook. He also serves as a director or trustee of various non-profit organizations and has served as Chairman or Vice Chairman of a number of them. He has served as a director or trustee of the AB Funds since 2007 and served as Chairman of the Governance and Nominating Committees of the AB Funds from 2007 until August 2014.		110	None

* The address for each of the Fund’s disinterested Directors is c/o AllianceBernstein L.P., Attention: Philip L. Kirstein, 1345 Avenue of the Americas, New York, NY 10105.

** There is no stated term of office for the Fund’s Directors.

*** The information above includes each Director’s principal occupation during the last five years and other information relating to the experience, attributes and skills relevant to each Director’s qualifications to serve as a Director, which led to the conclusion that each Director should serve as a Director for the Fund.

+ Mr. Keith is an “interested person” of the Fund as defined in the “40 Act”, due to his position as a Senior Vice President of the Adviser.

# Member of the Audit Committee, the Governance and Nominating Committee and the Independent Directors Committee.

92 •  AB INTERMEDIATE BOND PORTFOLIO

Management of the Fund

Officer Information

Certain information concerning the Fund’s Officers is set forth below.

NAME, ADDRESS* AND AGE	PRINCIPAL POSITION(S) HELD WITH FUND	PRINCIPAL OCCUPATION DURING PAST 5 YEARS
Robert M. Keith 55	President and Chief Executive Officer	See biography above.
Philip L. Kirstein 70	Senior Vice President and Independent Compliance Officer	Senior Vice President and Independent Compliance Officer of the AB Funds, with which he has been associated since October 2004. Prior thereto, he was Of Counsel to Kirkpatrick & Lockhart, LLP from October 2003 to October 2004, and General Counsel of Merrill Lynch Investment Managers, L.P. since prior to March 2003.
Paul J. DeNoon 53	Vice President	Senior Vice President of the Adviser**, with which he has been associated since prior to 2010.
Shawn E. Keegan 44	Vice President	Vice President of the Adviser**, with which he has been associated since prior to 2010.
Alison M. Martier 58	Vice President	Senior Vice President of the Adviser**, with which she has been associated since prior to 2010.
Douglas J. Peebles 50	Vice President	Senior Vice President of the Adviser**, with which he has been associated since prior to 2010.
Greg J. Wilensky 48	Vice President	Senior Vice President of the Adviser**, with which he has been associated since prior to 2010.
Emilie D. Wrapp 59	Secretary	Senior Vice President, Assistant General Counsel and Assistant Secretary of ABI**, with which she has been associated since prior to 2010.
Joseph J. Mantineo 56	Treasurer and Chief Financial Officer	Senior Vice President of AllianceBernstein Investor Services, Inc. (“ABIS”)**, with which he has been associated since prior to 2010.
Phyllis J. Clarke 54	Controller	Vice President of ABIS**, with which she has been associated since prior to 2010.
Vincent S. Noto 50	Chief Compliance Officer	Senior Vice President since 2015 and Mutual Fund Chief Compliance Officer of the Adviser ** since 2014. Prior thereto, he was Vice President and Director of Mutual Fund Compliance of the Adviser** since 2010.

* The address for each of the Fund’s Officers is 1345 Avenue of the Americas, New York, NY 10105.

** The Adviser, ABI and ABIS are affiliates of the Fund.

The Fund’s Statement of Additional Information (“SAI”) has additional information about the Fund’s Directors and Officers and is available without charge upon request. Contact your financial representative or AB at 1-800-227-4618, or visit www.abglobal.com, for a free prospectus or SAI.

AB INTERMEDIATE BOND PORTFOLIO  • 93

Management of the Fund

THE FOLLOWING IS NOT PART OF THE SHAREHOLDER REPORT OR THE FINANCIAL STATEMENTS

SUMMARY OF SENIOR OFFICER’S EVALUATION OF INVESTMENT ADVISORY AGREEMENT¹

The following is a summary of the evaluation of the Investment Advisory Agreement between AllianceBernstein L.P. (the “Adviser”) and AB Bond Fund, Inc. (the “Fund”) with respect to AB Intermediate Bond Portfolio (the “Portfolio”).² The evaluation of the Investment Advisory Agreement was prepared by Philip L. Kirstein, the Senior Officer of the Fund, for the Directors of the Fund, as required by the September 1, 2004 Assurance of Discontinuance (“AoD”) between the Adviser and the New York State Attorney General (the “NYAG”). The Senior Officer’s evaluation of the Investment Advisory Agreement is not meant to diminish the responsibility or authority of the Board of Directors of the Fund to perform its duties pursuant to Section 15 of the Investment Company Act of 1940 (the “40 Act”) and applicable state law. The purpose of this summary is to provide shareholders with a synopsis of the independent evaluation of the reasonableness of the advisory fees proposed to be paid by the Portfolio which was provided to the Directors in connection with their review of the proposed approval of the continuance of the Investment Advisory Agreement. The Senior Officer’s evaluation considered the following factors:

1. Advisory fees charged to institutional and other clients of the Adviser for like services;

2. Advisory fees charged by other mutual fund companies for like services;

3. Costs to the Adviser and its affiliates of supplying services pursuant to the advisory agreement, excluding any intra-corporate profit;

4. Profit margins of the Adviser and its affiliates from supplying such services;

5. Possible economies of scale as the Portfolio grows larger; and

6. Nature and quality of the Adviser’s services including the performance of the Portfolio.

These factors, with the exception of the first factor, are generally referred to as the “Gartenberg factors,” which were articulated by the United States Court of Appeals for the Second Circuit in 1982. Gartenberg v. Merrill Lynch Asset Management, Inc.,
694 F. 2d 923 (2d Cir. 1982). On March 30, 2010, the Supreme Court held the Gartenberg decision was correct in its basic formulation of what Section 36(b) requires: to face liability under Section 36(b), “an investment

1 The Senior Officer’s fee evaluation was completed on October 22, 2015 and discussed with the Board of Directors on November 3-5, 2015.

2 Future references to the Portfolio do not include “AB.” References in the fee summary pertaining to performance and expense ratios refer to the Class A shares of the Portfolio.

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adviser must charge a fee that is so disproportionately large that it bears no reasonable relationship to the services rendered and could not have been the product of arm’s length bargaining.” Jones v. Harris Associates L.P., 130 S. Ct. 1418 (2010). In Jones, the Court stated the Gartenberg approach fully incorporates the correct understanding of fiduciary duty within the context of Section 36(b) and noted with approval that “Gartenberg insists that all relevant circumstances be taken into account” and “uses the range of fees that might result from arm’s length bargaining as the benchmark for reviewing challenged fees.”³

INVESTMENT ADVISORY FEES, NET ASSETS, EXPENSE CAPS & RATIOS

The Adviser proposed that the Portfolio pays the advisory fee set forth in the table below for receiving the services to be provided pursuant to the Investment Advisory Agreement. The fee schedule below, implemented in January 2004 in connection with the Adviser’s settlement with the NYAG in December 2003, is based on a master schedule that contemplates eight categories of funds with almost all funds in each category having the same advisory fee schedule.

Portfolio	Category	Advisory Fee Based on % of Average Daily Net Assets	Net Assets 09/30/15 ($MM)
Intermediate Bond Portfolio	Low Risk Income	0.45% on 1st $2.5 billion 0.40% on next $2.5 billion 0.35% on the balance	$	329.0

The Adviser is reimbursed as specified in the Investment Advisory Agreement for certain clerical, legal, accounting, administrative and other services provided to the Portfolio. During the Portfolio’s fiscal year ended October 31, 2014, the Adviser received $56,402 (0.015% of the Portfolio’s average daily net assets) for such services.

3 Jones v. Harris at 1427.

AB INTERMEDIATE BOND PORTFOLIO  • 95

The Adviser agreed to waive that portion of its advisory fees and/or reimburse the Portfolio for that portion of the Portfolio’s total operating expenses to the degree necessary to limit the Portfolio’s expense ratios to the amounts set forth below for the Portfolio’s current fiscal year. The waiver is terminable by the Adviser upon at least 60 days’ notice prior to the Portfolio’s prospectus update. In addition, set forth below are the Portfolio’s gross expense ratios for the most recent semi-annual period:⁴

Portfolio	Expense Cap Pursuant to Expense Limitation Undertaking			Gross Expense Ratio5			Fiscal Year End
Intermediate Bond Portfolio6	Advisor Class A Class B Class C Class R Class K Class I Class Z	0.60 0.85 1.60 1.60 1.10 0.85 0.60 0.60	%  %  %  %  %  %  %  %		0.76 1.06 1.79 1.77 1.37 1.05 0.73 0.63	%  %  %  %  %  %  %  %	Oct. 31 (ratios as of Apr. 30, 2015)

I. ADVISORY FEES CHARGED TO INSTITUTIONAL AND OTHER CLIENTS

The advisory fees charged to investment companies which the Adviser manages and sponsors are normally higher than those charged to similar sized institutional accounts, including pension plans and sub-advised investment companies. The fee differential reflects, among other things, different services provided to such clients, and different liabilities assumed. Services provided by the Adviser to the Portfolio that are not provided to non-investment company clients include providing office space and personnel to serve as Fund Officers, who among other responsibilities make the certifications required under the Sarbanes-Oxley Act of 2002, and coordinating with and monitoring the Portfolio’s third party service providers such as Fund counsel, auditors, custodians, transfer agents and pricing services. The accounting, administrative, legal and compliance requirements for the Portfolio are more costly than those for institutional client assets due to the greater complexities and time required for investment companies, although as previously noted, the Adviser is reimbursed for providing such services. Also, retail mutual funds managed by the Adviser are widely held and accordingly, servicing the Portfolio’s investors is more time consuming and labor intensive compared to servicing institutional clients since the Adviser needs to communicate with a more extensive network of financial intermediaries and shareholders. The Adviser also believes that it incurs substantial entrepreneurial risk when offering a new mutual fund since establishing a new mutual fund requires a large upfront investment and it may take

4 Semi-annual total expense ratios are unaudited.

5 Annualized.

6 Effective June 1, 2015, the Rule 12b-1 fee for Class A shares was reduced from 0.30% to 0.25%. At the same time, the expense cap for the Class A shares was also reduced from 0.90% to 0.85%.

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a long time for the fund to achieve profitability since the fund must be priced to scale from inception in order to be competitive and assets are acquired one account at a time. In addition, managing the cash flow of an investment company may be more difficult than that of a stable pool of assets, such as an institutional account with little cash movement in either direction, particularly if the Portfolio is in net redemption and the Adviser is frequently forced to sell securities to raise cash for redemptions. However, managing a fund with positive cash flow may be easier at times than managing a stable pool of assets. Finally, in recent years, investment advisers have been sued by institutional clients and have suffered reputational damage both by the attendant publicity and outcomes other than complete victories. Accordingly, the legal and reputational risks associated with institutional accounts are greater than previously thought, although arguably still not equal to those related to the mutual fund industry.

Notwithstanding the Adviser’s view that managing an investment company is not comparable to managing other institutional accounts because the services provided are different, the Supreme Court has indicated consideration should be given to the advisory fees charged to institutional accounts with a similar investment style as the Portfolio.⁷ In addition to the AB Institutional fee schedule, set forth below is what would have been the effective advisory fee for the Portfolio had the AB Institutional fee schedule been applicable to the Portfolio based on September 30, 2015 net assets.⁸

Portfolio	Net Assets 9/30/15 ($MM)		AB Institutional Fee Schedule	Effective AB Inst. Adv. Fee		Portfolio Advisory Fee
Intermediate Bond Portfolio		$329.0	U.S. Strategic Core Plus Schedule 0.50% on 1st $30 million 0.20% on the balance Minimum account size: $25m		0.227%	0.450%

7 The Supreme Court stated that “courts may give such comparisons the weight that they merit in light of the similarities and differences between the services that the clients in question require, but the courts must be wary of inapt comparisons.” Among the significant differences the Supreme Court noted that may exist between services provided to mutual funds and institutional accounts are “higher marketing costs.” Jones v. Harris at 1428.

8 The Adviser has indicated that with respect to institutional accounts with assets greater than $300 million, it will negotiate a fee schedule. Discounts that are negotiated vary based upon each client relationship.

AB INTERMEDIATE BOND PORTFOLIO  • 97

The Adviser manages Sanford C. Bernstein Fund, Inc. (“SCB Fund”), an open-end management investment company. The Intermediate Duration Portfolio of SCB Fund has a similar investment style as the Portfolio. Set forth below are Intermediate Duration Portfolio’s advisory fee schedule and what would have been the effective advisory fee of the Portfolio had the fee schedule of Intermediate Duration Portfolio been applicable to the Portfolio based on September 30, 2015 net assets:

Portfolio	SCB Fund Portfolio	Fee Schedule	SCB Fund Effective Fee		Portfolio Advisory Fee
Intermediate Bond Portfolio	Intermediate Duration Portfolio	0.50% on 1st $1 billion 0.45% on next $2 billion 0.40% on next $2 billion 0.35% on next $2 billion 0.30% thereafter		0.500%	0.450%

The adviser also manages the AB Variable Products Series Fund, Inc. (“AVPS”), which is available through variable annuity and variable life contracts offered by other financial institutions and offers policyholders the option to utilize certain AVPS portfolios as the investment option underlying their insurance contracts. Set forth below is the fee schedule of the AVPS portfolio that has a substantially similar investment style as the Portfolio.⁹ Also shown are what would have been the effective advisory fee of the Portfolio had the AVPS fee schedule been applicable to the Portfolio and the Portfolio’s advisory fees based on September 30, 2015 net assets:

Portfolio	AVPS Portfolio	Fee Schedule	AVPS Effective Fee		Portfolio Advisory Fee
Intermediate Bond Fund	Intermediate Bond Portfolio	0.45% on first $2.5 billion 0.40% on next $2.5 billion 0.35% on the balance		0.450%	0.450%

The Adviser provides sub-advisory investment services to certain other investment companies managed by other fund families. The Adviser charges the following fee for the sub-advisory relationship that has a somewhat similar investment style as the Portfolio. Also shown are the Portfolio’s advisory fee, the advisory fee schedule of the sub-advised fund, and what would have been the

9 The AVPS portfolio was also affected by the settlement between the Adviser and the NYAG. As a result, the Portfolio has the same breakpoints in its advisory fee schedule as the AVPS portfolio.

98 •  AB INTERMEDIATE BOND PORTFOLIO

effective management fee of the Portfolio had the fee schedule of the sub-advisory relationship been applicable to the Portfolio based on September 30, 2015 net assets:

Portfolio	Sub-advised Fund	Sub-advised Fund Fee Schedule	Sub-Advised Management Fund Effective Fee		Portfolio Advisory Fee
Intermediate Bond Portfolio10	Client #111	0.29% on first $100 million 0.20% thereafter		0.227%	0.450%

It is fair to note that the services the Adviser provides pursuant to sub-advisory agreements are generally confined to the services related to the investment process; in other words, they are not as comprehensive as the services provided to the Portfolio by the Adviser. In addition to the extent that this sub-advisory relationship is with an affiliate of the Adviser, the fee schedule may not reflect arm’s-length bargaining or negotiations.

While it appears that the sub-advisory relationship is paying a lower fee than the Portfolio, it is difficult to evaluate the relevance of such fees due to the differences in the services provided, risks involved and other competitive factors between the Portfolio and the sub-advisory relationship. There could be various business reasons why an investment adviser would be willing to provide a sub-advised relationship investment related services at a different fee level than an investment company it is sponsoring where the investment adviser is provided all the services, not just investment management service generally required by a registered investment company.

II. MANAGEMENT FEES CHARGED BY OTHER MUTUAL FUND COMPANIES FOR LIKE SERVICES.

Broadridge Financial Solutions, Inc. (“Broadridge”), an analytical service that is not affiliated with the Adviser, compared the fees charged to the Portfolio with fees charged to other investment companies for similar services by other investment advisers.^12,13 Broadridge’s analysis included the comparison of each Portfolio’s

10 It should be noted that the advisory fee paid by the shareholders of the sub-advisory relationship is higher than the fee charged to the Portfolio.

11 The sub-advisory relationship is with an affiliate of the Adviser.

12 The Supreme Court cautioned against accepting mutual fund fee comparisons without careful scrutiny since “these comparisons are problematic because these fees, like those challenged, may not be the product of negotiations conducted at arm’s length.” Jones v. Harris at 1429.

13 On June 5, 2015, Broadridge acquired the Fiduciary Services and Competitive Intelligence unit, i.e., the group responsible for providing the Portfolio’s 15(c) reports, from Thomson Reuters’ Lipper division. The group that maintains Lipper’s expense and performance databases and investment classification/objective remains a part of Thomson Reuters’ Lipper division. Accordingly, the Portfolio’s investment classification continued to be determined by Lipper.

AB INTERMEDIATE BOND PORTFOLIO  • 99

contractual management fee,¹⁴ estimated at the approximate current asset level of the subject Portfolio, to the median of the Portfolio’s Broadridge Expense Group (“EG”)¹⁵ and the Portfolio’s contractual management fee ranking.

Broadridge describes an EG as a representative sample of comparable funds. Broadridge’s standard methodology for screening funds to be included in an EG entails the consideration of several fund criteria, including fund type, Lipper investment classification/objective, load type, similar 12b-1/non-12b-1 service fees, asset (size) comparability, expense components and attributes. An EG will typically consist of seven to twenty funds.

Portfolio	Contractual Management Fee (%)		Broadridge EG Median (%)		Rank
Intermediate Bond Portfolio		0.450		0.461	4/14

Broadridge also analyzed the Portfolio’s most recently completed fiscal year total expense ratios in comparison to the Portfolio’s EGs and Broadridge Expense Universe (“EU”). The EU is a broader group compared to the EG, consisting of all funds that have the same Lipper investment classification/objective and load type as the subject Fund.¹⁶ Set forth below is Broadridge’s comparison of the Portfolio’s total expense ratios and the median of the Portfolio’s EGs and EUs. The Portfolio’s total expense ratio rankings are also shown. Pro-forma total expense ratio (italicized) is shown to reflect the Portfolio’s 12b-1 fee reduction had the reduction been in effect during the Portfolio’s entire fiscal year.

Portfolio	Total Expense Ratio (%)17		Broadridge Exp. Group Median (%)		Broadridge Group Rank	Broadridge Exp. Universe Median (%)		Broadridge Universe Rank
Intermediate Bond Portfolio		0.900		0.889	9/14		0.852	34/50
Pro-forma		0.850		0.889	5/14		0.852	26/50

14 The contractual management fee is calculated by Broadridge using the Portfolio’s contractual management fee rate at the hypothetical asset level. The hypothetical asset level is based on the combined net assets of all classes of the Portfolio, rounded up to the next $25 million. Broadridge’s total expense ratio information is based on the most recent annual report except as otherwise noted. A ranking of “1” would mean that the Portfolio had the lowest effective fee rate in the Broadridge peer group.

15 Broadridge does not consider average account size when constructing EGs. Funds with relatively small average account sizes tend to have a higher transfer agent expense ratio than comparable sized funds that have relatively large average account sizes.

16 Except for asset (size) comparability, Broadridge uses the same criteria for selecting an EG when selecting an EU. Unlike the EG, the EU allows for the same adviser to be represented by more than just one fund.

17 Most recently completed fiscal year Class A share total expense ratio.

100 •  AB INTERMEDIATE BOND PORTFOLIO

Based on this analysis, considering pro-forma information, the Portfolio has a more favorable ranking on a contractual management fee basis than on a total expense ratio basis.

III. COSTS TO THE ADVISER AND ITS AFFILIATES OF SUPPLYING SERVICES PURSUANT TO THE ADVISORY FEE ARRANGEMENT, EXCLUDING ANY INTRA-CORPORATE PROFIT.

The Adviser utilizes two profitability reporting systems, which operate independently but are aligned with each other, to estimate the Adviser’s profitability in connection with investment advisory services provided to the Portfolio. The Senior Officer has retained an independent consultant to provide independent advice regarding the alignment of the two profitability systems as well as the methodologies and allocations utilized by both profitability systems. See Section IV for additional discussion.

IV. PROFIT MARGINS OF THE ADVISER AND ITS AFFILIATES FOR SUPPLYING SUCH SERVICES.

The profitability information for the Portfolio, prepared by the Adviser for the Board of Directors, was reviewed by the Senior Officer and the independent consultant. The Adviser’s profitability from providing investment advisory services to the Portfolio decreased during calendar year 2014 relative to 2013.

In addition to the Adviser’s direct profits from managing the Portfolio, certain of the Adviser’s affiliates have business relationships with the Portfolio and may earn a profit from providing other services to the Portfolio. The courts have referred to this type of business opportunity as “fall-out benefits” to the Adviser and indicated that such benefits should be factored into the evaluation of the total relationship between the Portfolio and the Adviser. Neither case law nor common business practice precludes the Adviser’s affiliates from earning a reasonable profit on this type of relationship provided the affiliates’ charges and services are competitive. These affiliates provide transfer agent and distribution related services to the Portfolio and receive transfer agent fees, front-end sales loads, Rule 12b-1 payments and contingent deferred sales charges (“CDSC”). During the Portfolio’s fiscal year ended October 21, 2014, ABI received from the Portfolio $4,583, $1,363,838 and $12,384 in front-end sales charges, Rule 12b-1 and CDSC fees, respectively.

AllianceBernstein Investments, Inc. (“ABI”), an affiliate of the Adviser, is the Portfolio’s principal underwriter. ABI and the Adviser have disclosed in the Portfolio’s prospectus that they may make revenue sharing payments from their own resources, in addition to revenues derived from sales loads and Rule 12b-1 fees, to firms that sell shares of the Portfolio. In 2014, ABI paid approximately 0.05% of the average monthly assets of the AllianceBernstein Mutual Funds or approximately $20.4 million for distribution services and educational support (revenue sharing payments).

AB INTERMEDIATE BOND PORTFOLIO  • 101

Fees and reimbursements for out of pocket expenses charged by AllianceBernstein Investor Services, Inc. (“ABIS”), the affiliated transfer agent for the Portfolio, are charged on a per account basis, based on the level of service

provided and the class of share held by the account. ABIS also receives a fee per shareholder sub-account for each account maintained by an intermediary on an omnibus basis. During the Portfolio’s fiscal year ended October 31, 2014, ABIS received $293,976 in fees from the Portfolio.

V. POSSIBLE ECONOMIES OF SCALE

The Adviser has indicated that economies of scale are being shared with shareholders through pricing to scale, breakpoints, fee reductions/waivers and enhancement to services.

In May 2012, an independent consultant, retained by the Senior Officer, provided the Board of Directors information on the Adviser’s firm-wide average costs from 2005 through 2011 and the potential economies of scale. The independent consultant noted that from 2005 through 2007 the Adviser experienced significant growth in assets under management (“AUM”). During this period, operating expenses increased, in part to keep up with growth, and in part reflecting market returns. However, from 2008 through the first quarter of 2009, AUM rapidly and significantly decreased due to declines in market value and client withdrawals. When AUM rapidly decreased, some operating expenses categories, including base compensation and office space, adjusted more slowly during this period, resulting in an increase in average costs. Since 2009, AUM has experienced less significant changes. The independent consultant noted that changes in operating expenses reflect changes in business composition and business practices in response to changes in financial markets. Finally, the independent consultant concluded that the increase in average cost and the decline in net operating margin across the Adviser since late 2008 are inconsistent with the view that there are currently reductions in average costs due to economies of scale that can be shared with the AllianceBernstein Mutual Funds managed by the Adviser through lower fees.

Previously, in February 2008, the independent consultant provided the Board of Directors an update of the Deli¹⁸ study on advisory fees and various fund characteristics.¹⁹ The independent consultant first reiterated the results of his previous

18 The Deli study, originally published in 2002 based on 1997 data and updated for the February 2008 Presentation, may be of diminished value due to the age of the data used in the presentation and the changes experienced in the industry since 2008.

19 As mentioned previously, the Supreme Court cautioned against accepting mutual fund fee comparisons without careful scrutiny since the fees may not be the product of negotiations conducted at arm’s length. See Jones v. Harris at 1429.

102 •  AB INTERMEDIATE BOND PORTFOLIO

two dimensional comparison analysis (fund size and family size) with the Board of Directors.²⁰ The independent consultant then discussed the results of the regression model that was utilized to study the effects of various factors on advisory fees. The regression model output indicated that the bulk of the variation in fees predicted were explained by various factors, but substantially by fund AUM, family AUM, index fund indicator and investment style. The independent consultant also compared the advisory fees of the AllianceBernstein Mutual Funds to similar funds managed by 19 other large asset managers, regardless of the fund size and each Adviser’s proportion of mutual fund assets to non-mutual fund assets.

VI. NATURE AND QUALITY OF THE ADVISER’S SERVICES INCLUDING THE PERFORMANCE OF THE PORTFOLIO.

With assets under management of approximately $463 billion as of September 30, 2015, the Adviser has the investment experience to manage and provide non-investment services (described in Section I) to the Portfolio.

The information below shows the 1, 3, 5 and 10 year performance returns and rankings of the Portfolio²¹ relative to its Broadridge Performance Group (“PG”) and Broadridge Performance Universe (“PU”)²² for the period ended July 31, 2015.²³

Portfolio	Portfolio Return (%)		PG Median (%)		PU Median (%)		PG Rank	PU Rank
Intermediate Bond Portfolio
1 year		2.25		1.90		2.02	2/15	16/63
3 year		2.28		1.65		1.70	2/15	10/61
5 year		3.75		3.17		3.40	2/15	15/57
10 year		4.59		4.47		4.47	5/12	18/47

20 The two dimensional analysis showed patterns of lower advisory fees for funds with larger asset sizes and funds from larger family sizes compared to funds with smaller asset sizes and funds from smaller family sizes, which according to the independent consultant is indicative of a sharing of economies of scale and scope. However, in less liquid and active markets, such is not the case, as the empirical analysis showed potential for diseconomies of scale in those markets. The empirical analysis also showed diminishing economies of scale and scope as funds surpassed a certain high level of assets.

21 The performance returns and rankings are for the Class A shares of the Portfolio. The performance returns of the Portfolios were provided Broadridge.

22 The Portfolio’s PG/PU is not identical to the Portfolio’s EG/EU as the criteria for including/excluding a fund in/from a PG/PU are somewhat different from that of an EG/EU.

23 The current Lipper investment classification/objective dictates the PG and PU throughout the life of the Portfolio even if the Portfolio may have had a different investment classification/objective at different points in time.

AB INTERMEDIATE BOND PORTFOLIO  • 103

Set forth below are the 1, 3, 5, 10 year and since inception net performance returns of the Portfolio (in bold)²⁴ versus its benchmark.²⁵ Portfolio and benchmark volatility and reward-to-variability ratio (“Sharpe Ratio”) information is also shown.²⁶

	Period Ending July 31, 2015 Annualized Performance
									Since Inception (%)		Annualized				Risk Period (Year)
	1 Year (%)		3 Year (%)		5 Year (%)		10 Year (%)				Volatility (%)		Sharpe (%)
Intermediate Bond Portfolio		2.25		2.28		3.75		4.59		5.04		4.29		0.73		10
Barclays Capital U.S. Aggregate Bond Index		2.82		1.60		3.27		4.61		5.37		3.25		0.96		10
Inception Date: July 1, 1999

CONCLUSION:

Based on the factors discussed above the Senior Officer’s conclusion is that the proposed advisory fee for the Portfolio is reasonable and within the range of what would have been negotiated at arm’s-length in light of all the surrounding circumstances. This conclusion in respect of the Portfolio is based on an evaluation of all of these factors and no single factor was dispositive.

Dated: November 25, 2015

24 The performance returns and risk measures shown in the table are for the Class A shares of the Portfolio.

25 The Adviser provided Portfolio and benchmark performance return information for the periods through July 31, 2015.

26 Portfolio and benchmark volatility and Sharpe Ratio information was obtained through Lipper LANA, a database maintained by Lipper. Volatility is a statistical measure of the tendency of a market price or yield to vary over time. A Sharpe Ratio is a risk adjusted measure of return that divides a fund’s return in excess of the riskless return by the fund’s standard deviation. A portfolio with a greater volatility would be viewed as more risky than a portfolio with equivalent performance but lower volatility; for that reason, a greater return would be demanded for the more risky fund. A portfolio with a higher Sharpe Ratio would be viewed as better performing than a fund with a lower Sharpe Ratio.

104 •  AB INTERMEDIATE BOND PORTFOLIO

THIS PAGE IS NOT PART OF THE SHAREHOLDER REPORT OR THE FINANCIAL STATEMENTS

AB FAMILY OF FUNDS

US EQUITY

US Core

Core Opportunities Fund

Select US Equity Portfolio

US Growth

Concentrated Growth Fund

Discovery Growth Fund

Growth Fund

Large Cap Growth Fund

Small Cap Growth Portfolio

US Value

Discovery Value Fund

Equity Income Fund

Growth & Income Fund

Small Cap Value Portfolio

Value Fund

INTERNATIONAL/ GLOBAL EQUITY

International/Global Core

Global Core Equity Portfolio

Global Equity & Covered Call Strategy Fund

Global Thematic Growth Fund

International Portfolio

Tax-Managed International Portfolio

International/Global Growth

International Growth Fund

International/Global Value

Asia ex-Japan Equity Portfolio

International Value Fund

FIXED INCOME

Municipal

High Income Municipal Portfolio

Intermediate California Municipal Portfolio

Intermediate Diversified Municipal Portfolio

Intermediate New York Municipal Portfolio

Municipal Bond Inflation Strategy

FIXED INCOME (continued)

Tax-Aware Fixed Income Portfolio

National Portfolio

Arizona Portfolio

California Portfolio

Massachusetts Portfolio

Michigan Portfolio

Minnesota Portfolio

New Jersey Portfolio

New York Portfolio

Ohio Portfolio

Pennsylvania Portfolio

Virginia Portfolio

Taxable

Bond Inflation Strategy

Global Bond Fund

High Income Fund

High Yield Portfolio

Intermediate Bond Portfolio

Limited Duration High Income Portfolio

Short Duration Portfolio

ALTERNATIVES

All Market Real Return Portfolio*

Credit Long/Short Portfolio

Global Real Estate Investment Fund

Long/Short Multi-Manager Fund

Multi-Manager Alternative Strategies Fund

Select US Long/Short Portfolio

Unconstrained Bond Fund

MULTI-ASSET

All Market Growth Portfolio*

All Market Income Portfolio

Emerging Markets Multi-Asset Portfolio

Global Risk Allocation Fund

MULTI-ASSET (continued)

Target-Date

Multi-Manager Select Retirement Allocation Fund

Multi-Manager Select 2010 Fund

Multi-Manager Select 2015 Fund

Multi-Manager Select 2020 Fund

Multi-Manager Select 2025 Fund

Multi-Manager Select 2030 Fund

Multi-Manager Select 2035 Fund

Multi-Manager Select 2040 Fund

Multi-Manager Select 2045 Fund

Multi-Manager Select 2050 Fund

Multi-Manager Select 2055 Fund

Wealth Strategies

Balanced Wealth Strategy

Conservative Wealth Strategy

Wealth Appreciation Strategy

Tax-Managed Balanced Wealth Strategy

Tax-Managed Conservative Wealth Strategy

Tax-Managed Wealth Appreciation Strategy

CLOSED-END FUNDS

AB Multi-Manager Alternative Fund

Alliance California Municipal Income Fund

AllianceBernstein Global High Income Fund

AllianceBernstein Income Fund

AllianceBernstein National Municipal Income Fund

We also offer Exchange Reserves, which serves as the money market fund exchange vehicle for the AB mutual funds. An investment in Exchange Reserves is not a deposit in a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.

Investors should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.abglobal.com or contact your AB representative. Please read the prospectus and/or summary prospectus carefully before investing.

* Prior to December 15, 2014, All Market Growth Portfolio was named Dynamic All Market Fund; All Market Real Return Portfolio was named Real Asset Strategy.

AB INTERMEDIATE BOND PORTFOLIO  • 105

AB Family of Funds

NOTES

106 •  AB INTERMEDIATE BOND PORTFOLIO

NOTES

AB INTERMEDIATE BOND PORTFOLIO  • 107

NOTES

108 •  AB INTERMEDIATE BOND PORTFOLIO

AB INTERMEDIATE BOND PORTFOLIO

1345 Avenue of the Americas

New York, NY 10105

800.221.5672

IB-0151-1015                

OCT    ^10.31.15

ANNUAL REPORT

AB MUNICIPAL BOND INFLATION STRATEGY

Investment Products Offered

• Are Not FDIC Insured

• May Lose Value

• Are Not Bank Guaranteed

Investors should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.abglobal.com or contact your AB representative. Please read the prospectus and/or summary prospectus carefully before investing.

This shareholder report must be preceded or accompanied by the Fund’s prospectus for individuals who are not current shareholders of the Fund.

You may obtain a description of the Fund’s proxy voting policies and procedures, and information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30, without charge. Simply visit AB’s website at www.abglobal.com, or go to the Securities and Exchange Commission’s (the “Commission”) website at www.sec.gov, or call AB at (800) 227-4618.

The Fund files its complete schedule of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q are available on the Commission’s website at www.sec.gov. The Fund’s Forms N-Q may also be reviewed and copied at the Commission’s Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330. AB publishes full portfolio holdings for the Fund monthly at www.abglobal.com.

AllianceBernstein Investments, Inc. (ABI) is the distributor of the AB family of mutual funds. ABI is a member of FINRA and is an affiliate of AllianceBernstein L.P., the Adviser of the funds.

The [A/B] logo is a registered service mark of AllianceBernstein and AllianceBernstein^® is a registered service mark used by permission of the owner, AllianceBernstein L.P.

December 15, 2015

Annual Report

This report provides management’s discussion of fund performance for AB Municipal Bond Inflation Strategy (the “Strategy”) for the annual period ended October 31, 2015. Effective January 20, 2015, the Strategy’s name changed from AllianceBernstein Municipal Bond Inflation Strategy to AB Municipal Bond Inflation Strategy.

Investment Objectives and Policies

The Strategy seeks to maximize real after-tax return for investors subject to federal income taxes, without undue risk to principal. Real return is the rate of return after adjusting for inflation. The Strategy pursues its objective by investing principally in high-quality, predominantly investment-grade, municipal securities that pay interest exempt from federal taxation. As a fundamental policy, the Strategy will invest at least 80% of its net assets in municipal securities. These securities may be subject to the federal alternative minimum tax (“AMT”) for some taxpayers.

The Strategy will invest at least 80% of its total assets in fixed-income securities rated A or better or the equivalent by one or more national rating agency or deemed to be of comparable credit quality by AllianceBernstein L.P. (the “Adviser”). In deciding whether to take direct or indirect exposure, the Strategy may invest up to 20% of its total assets in fixed-income securities rated BB or B or the equivalent by one or more national rating agency (or deemed to be of comparable credit quality by the Adviser), which are not investment grade (“junk bonds”). If the rating of a fixed-income security falls below investment grade, the Strategy will not be obligated to sell the security and may continue to hold it if, in the Adviser’s opinion, the investment is appropriate under the circumstances.

The Strategy may invest in fixed-income securities with any maturity and duration.

To provide inflation protection, the Strategy will typically enter into inflation swap agreements. The Strategy may use other inflation-protected instruments. Payments to the Strategy pursuant to swap agreements will result in taxable income, either ordinary income or capital gains, rather than income exempt from federal income taxation. It is expected that the Strategy’s primary use of derivatives will be for the purpose of inflation protection.

The Strategy may also invest in forward commitments; zero coupon municipal securities and variable, floating and inverse floating rate municipal securities; certain types of mortgage related securities; and derivatives, such as options, futures, forwards and swaps.

The Strategy may also utilize leverage for investment purposes through the use of tender option bonds (“TOBs”) transactions. The Adviser will consider the impact of TOBs, swap agreements and other derivatives in making its assessments of the Strategy’s risks. The resulting exposures to markets, sectors, issuers or specific securities will be continuously monitored by the Adviser.

Investment Results

The table on page 5 shows the Strategy’s performance for the six- and 12-month periods ended October 31, 2015, compared to its benchmark, the Barclays 1-10 Year Treasury Inflation-Protected Securities (“TIPS”) Index and to the Lipper Intermediate Municipal Debt Funds Average (the “Lipper Average”). Funds in the Lipper Average have generally similar investment objectives to the Strategy, although some may have different

AB MUNICIPAL BOND INFLATION STRATEGY  • 1

investment policies and sales and management fees and fund expenses.

All share classes of the Strategy outperformed the benchmark, but underperformed the Lipper Average for the six-month period, before sales charges. All share classes of the Strategy underperformed the benchmark and the Lipper Average for the 12-month period, before sales charges. In order to pursue the investment objective of after-tax returns net of inflation, the Strategy invests in municipal bonds and uses derivatives for inflation protection.

For the six-month period, the positive performance relative to the benchmark was driven by the Strategy’s investment in municipal bonds, which outperformed US Treasuries. Derivatives, including inflation (“CPI”) swaps, are used in the Fund to hedge inflation and added to performance as they outperformed TIPs. During the 12-month period, the Strategy underperformed the benchmark as US Treasuries outperformed municipals and CPI swaps underperformed TIPs. Interest rate swaps were used for hedging purposes and had no material impact on absolute performance for either period.

Relative to the Lipper Average, the Strategy’s underperformance over both periods was driven primarily by nominal bond strategies outperforming strategies hedged with CPI swaps as global commodity prices fell.

Market Review and Investment Strategy

During the reporting period Treasury yields generally fell as the slowdown in China clouded the picture for economic growth in the United States. Commodity prices fell, emerging market economies sputtered, stock prices were volatile and the US dollar

strengthened. Over both periods, municipal bonds generally had positive returns and even mid-grade and high-yield municipals performed well, in sharp contrast to the investment-grade and high-yield corporate bond markets. A general scarcity of municipal credit issuance and an abundance of corporate-debt issuance partly explain the divergent returns in the markets.

Tax revenues for municipal issuers have been positive and the creditworthiness of municipal mid-grade and high-yield issuers continues to improve modestly in step with the domestic economy. The Municipal Bond Investment Team has structured the Strategy to be modestly overweight medium grade credit quality bonds.

The Fund may purchase municipal securities that are insured under policies issued by certain insurance companies. Historically, insured municipal securities typically received a higher credit rating, which meant that the issuer of the securities paid a lower interest rate. As a result of declines in the credit quality and associated downgrades of most fund insurers, insurance has less value than it did in the past. The market now values insured municipal securities primarily based on the credit quality of the issuer of the security with little value given to the insurance feature. In purchasing such insured securities, the Adviser evaluates the risk and return of municipal securities through its own research. If an insurance company’s rating is downgraded or the company becomes insolvent, the prices of municipal securities insured by the insurance company may decline. As of October 31, 2015, the Strategy’s percentages of investments in municipal bonds that are insured and in insured municipal bonds that have been prerefunded or escrowed to maturity were 6.81% and 0%, respectively.

2 •  AB MUNICIPAL BOND INFLATION STRATEGY

DISCLOSURES AND RISKS

Benchmark Disclosure

The Barclays 1-10 Year TIPS Index does not reflect fees and expenses associated with the active management of a mutual fund portfolio. The Barclays 1-10 Year TIPS Index represents the performance of inflation-protected securities issued by the US Treasury. An investor cannot invest directly in an index, and its results are not indicative of the performance for any specific investment, including the Strategy.

A Word About Risk

Market Risk: The value of the Strategy’s assets will fluctuate as the stock or bond market fluctuates. The value of the Strategy’s investments may decline, sometimes rapidly and unpredictably, simply because of economic changes or other events that affect large portions of the market.

Credit Risk: An issuer or guarantor of a fixed-income security, or the counterparty to a derivatives or other contract, may be unable or unwilling to make timely payments of interest or principal, or to otherwise honor its obligations. The issuer or guarantor may default causing a loss of the full principal amount of a security. The degree of risk for a particular security may be reflected in its credit rating. There is the possibility that the credit rating of a fixed-income security may be downgraded after purchase, which may adversely affect the value of the security. Investments in fixed-income securities with lower ratings (commonly referred to as “junk bonds”) tend to have a higher probability that an issuer will default or fail to meet its payment obligations.

Municipal Market Risk: This is the risk that special factors may adversely affect the value of municipal securities and have a significant effect on the yield or value of the Strategy’s investments in municipal securities. These factors include economic conditions, political or legislative changes, uncertainties related to the tax status of municipal securities, or the rights of investors in these securities. To the extent that the Strategy invests more of its assets in a particular state’s municipal securities, the Strategy may be vulnerable to events adversely affecting that state, including economic, political and regulatory occurrences, court decisions, terrorism and catastrophic natural disasters, such as hurricanes or earthquakes. The Strategy’s investments in certain municipal securities with principal and interest payments that are made from the revenues of a specific project or facility, and not general tax revenues, may have increased risks. Factors affecting the project or facility, such as local business or economic conditions, could have a significant effect on the project’s ability to make payments of principal and interest on these securities.

Tax Risk: There is no guarantee that all of the Strategy’s income will remain exempt from federal or state income taxes. From time to time, the US government and the US Congress consider changes in federal tax law that could limit or eliminate the federal tax exemption for municipal bond income, which would in effect reduce the income received by shareholders from the Strategy by increasing taxes on that income. In such event, the Strategy’s net asset value (“NAV”) could also decline as yields on municipal bonds, which are typically lower than those on taxable bonds, would be expected to increase to approximately the yield of comparable taxable bonds. Actions or anticipated actions affecting the tax exempt status of municipal bonds could also result in significant shareholder redemptions of Strategy shares as investors anticipate adverse effects on the Strategy or seek higher yields to offset the potential loss of the tax deduction. As a result, the Strategy would be required to maintain higher levels of cash to meet the redemptions, which would negatively affect the Strategy’s yield.

Interest Rate Risk: Changes in interest rates will affect the value of investments in fixed-income securities. When interest rates rise, the value of investments in fixed-income securities tends to fall and this decrease in value may not be offset by higher income from new investments. Interest rate risk is generally greater for fixed-income securities with longer maturities or durations.

(Disclosures, Risks and Note about Historical Performance continued on next page)

AB MUNICIPAL BOND INFLATION STRATEGY  • 3

Disclosures and Risks

DISCLOSURES AND RISKS

(continued from previous page)

Duration Risk: Duration is a measure that relates the expected price volatility of a fixed-income security to changes in interest rates. The duration of a fixed-income security may be shorter than or equal to full maturity of a fixed-income security. Fixed-income securities with longer durations have more risk and will decrease in price as interest rates rise. For example, a fixed-income security with a duration of three years will decrease in value by approximately 3% if interest rates increase by 1%.

Inflation Risk: This is the risk that the value of assets or income from investments will be less in the future as inflation decreases the value of money. As inflation increases, the value of the Strategy’s assets can decline as can the value of the Strategy’s distributions. This risk is significantly greater for fixed-income securities with longer maturities.

Derivatives Risk: The Strategy’s investments in derivatives, such as swaps, futures, options and forwards, may be illiquid, difficult to price, and leveraged so that small changes may produce disproportionate losses for the Strategy, and may be subject to counterparty risk to a greater degree than more traditional investments. The use of inflation protection derivatives to help meet the Strategy’s investment objective may not be successful.

Leverage Risk: To the extent the Strategy uses leveraging techniques, its NAV may be more volatile because leverage tends to exaggerate the effect of changes in interest rates and any increase or decrease in the value of the Strategy’s investments.

Liquidity Risk: Liquidity risk exists when particular investments, such as lower-rated securities, are difficult to purchase or sell, possibly preventing the Strategy from selling out of these illiquid securities at an advantageous price. The Strategy is subject to liquidity risk because the market for municipal securities is generally smaller than many other markets. Derivatives and securities involving substantial market and credit risk tend to involve greater liquidity risk.

Management Risk: The Strategy is subject to management risk because it is an actively managed investment fund. The Adviser will apply its investment techniques and risk analyses in making investment decisions, but there is no guarantee that its techniques will produce the intended results.

These risks are fully discussed in the Strategy’s prospectus. As with all investments, you may lose money by investing in the Strategy.

An Important Note About Historical Performance

The investment return and principal value of an investment in the Strategy will fluctuate, so that shares, when redeemed, may be worth more or less than their original cost. Performance shown on the following pages represents past performance and does not guarantee future results. Current performance may be lower or higher than the performance information shown. You may obtain performance information current to the most recent month-end by visiting www.abglobal.com. For Class 1 shares click on “Private Clients”, then “Investments”, then “Stocks” or “Bonds”, then “Mutual Fund Performance at a Glance”.

All fees and expenses related to the operation of the Strategy have been deducted. NAV returns do not reflect sales charges; if sales charges were reflected, the Strategy’s quoted performance would be lower. SEC returns reflect the applicable sales charges for each share class: a 3.00% maximum front-end sales charge for Class A shares; and a 1% 1-year contingent deferred sales charge for Class C shares. Class 1 and 2 shares do not carry sales charges. Returns for the different share classes will vary due to different expenses associated with each class. Performance assumes reinvestment of distributions and does not account for taxes.

4 •  AB MUNICIPAL BOND INFLATION STRATEGY

Disclosures and Risks

HISTORICAL PERFORMANCE

THE STRATEGY VS. ITS BENCHMARK PERIODS ENDED OCTOBER 31, 2015 (unaudited)	NAV Returns
	6 Months		12 Months
AB Municipal Bond Inflation Strategy
Class 1*		-0.22%		-1.62%
Class 2*		-0.17%		-1.52%
Class A		-0.32%		-1.83%
Class C		-0.70%		-2.56%
Advisor Class Shares†		-0.29%		-1.56%
Barclays 1-10 Year TIPS Index		-1.83%		-1.24%
Lipper Intermediate Municipal Debt Funds Average		0.97%		1.38%
*    Class 1 shares are only available to Bernstein Global Wealth Management private client accounts. Class 2 shares are only available to large Bernstein Global Wealth Management private client accounts and the Adviser’s institutional clients or through other limited arrangements. †     Please note that these share classes are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Strategy.

See Disclosures, Risks and Note about Historical Performance on pages 3-4.

(Historical Performance continued on next page)

AB MUNICIPAL BOND INFLATION STRATEGY  • 5

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

GROWTH OF A $10,000 INVESTMENT IN THE STRATEGY 1/26/10* TO 10/31/15 (unaudited)

This chart illustrates the total value of an assumed $10,000 investment in AB Municipal Bond Inflation Strategy Class A shares (from 1/26/10* to 10/31/15) as compared to the performance of its benchmark. The chart reflects the deduction of the maximum 3.00% sales charge from the initial $10,000 investment in the Strategy and assumes the reinvestment of dividends and capital gains distributions.

* Inception date: 1/26/2010.

See Disclosures, Risks and Note about Historical Performance on pages 3-4.

(Historical Performance continued on next page)

6 •  AB MUNICIPAL BOND INFLATION STRATEGY

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

AVERAGE ANNUAL RETURNS AS OF OCTOBER 31, 2015 (unaudited)
	NAV Returns			SEC Returns (reflects applicable sales charges)			SEC Yields*
Class 1 Shares†								1.12	%
1 Year		-1.62	%		-1.62	%
5 Years		1.75	%		1.75	%
Since Inception‡		1.83	%		1.83	%
Class 2 Shares†								1.22	%
1 Year		-1.52	%		-1.52	%
5 Years		1.86	%		1.86	%
Since Inception‡		1.94	%		1.94	%
Class A Shares								0.86	%
1 Year		-1.83	%		-4.74	%
5 Years		1.56	%		0.94	%
Since Inception‡		1.65	%		1.11	%
Class C Shares								0.15	%
1 Year		-2.56	%		-3.53	%
5 Years		0.83	%		0.83	%
Since Inception‡		0.93	%		0.93	%
Advisor Class Shares^								1.14	%
1 Year		-1.56	%		-1.56	%
5 Years		1.83	%		1.83	%
Since Inception‡		1.93	%		1.93	%

The Strategy’s current prospectus fee table shows the Strategy’s total annual operating expense ratios as 0.66%, 0.56%, 0.85%, 1.60%, and 0.60% for Class 1, Class 2, Class A, Class C and Advisor Class shares, respectively, gross of any fee waivers or expense reimbursements. Contractual fee waivers and/or expense reimbursements limit the Strategy’s annual operating expense ratios, exclusive of interest expense, to 0.60%, 0.50%, 0.75%, 1.50%, and 0.50% for Class 1, Class 2, Class A, Class C, and Advisor Class shares, respectively. These waivers/ reimbursements may not be terminated prior to January 29, 2016 and may be extended by the Adviser for additional one-year terms. Absent reimbursements or waivers, performance would have been lower. The Financial Highlights section of this report sets forth expense ratio data for the current reporting period; the expense ratios shown above may differ from the expense ratios in the Financial Highlights sections since they are based on different time periods.

* SEC yields are calculated based on SEC guidelines for the 30-day period ended October 31, 2015.

^†  Class 1 shares are only available to Bernstein Global Wealth Management private client accounts. Class 2 shares are only available to large Bernstein Global Wealth Management private client accounts and the Adviser’s institutional clients or through other limited arrangements.

^‡  Inception date: 1/26/2010.

^{^}  These share classes are offered at NAV to eligible investors and their SEC returns are the same as their NAV returns. Please note that these share classes are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Strategy. The inception date for these share classes is listed above.

See Disclosures, Risks and Note about Historical Performance on pages 3-4.

(Historical Performance continued on next page)

AB MUNICIPAL BOND INFLATION STRATEGY  • 7

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

SEC AVERAGE ANNUAL RETURNS AS OF THE MOST RECENT CALENDAR QUARTER-END SEPTEMBER 30, 2015 (unaudited)
	SEC Returns (reflects applicable sales charges)
Class 1 Shares*
1 Year		-2.70	%
5 Years		1.65	%
Since Inception†		1.69	%
Class 2 Shares*
1 Year		-2.60	%
5 Years		1.74	%
Since Inception†		1.78	%
Class A Shares
1 Year		-5.78	%
5 Years		0.82	%
Since Inception†		0.95	%
Class C Shares
1 Year		-4.60	%
5 Years		0.73	%
Since Inception†		0.78	%
Advisor Class Shares‡
1 Year		-2.55	%
5 Years		1.75	%
Since Inception†		1.79	%

* Class 1 shares are only available to Bernstein Global Wealth Management private client accounts. Class 2 shares are only available to large Bernstein Global Wealth Management private client accounts and the Adviser’s institutional clients or through other limited arrangements.

^†  Inception date: 1/26/2010.

^‡  These share classes are offered at NAV to eligible investors and their SEC returns are the same as their NAV returns. Please note that these share classes are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Strategy. The inception date for these share classes is listed above.

See Disclosures, Risks and Note about Historical Performance on pages 3-4.

8 •  AB MUNICIPAL BOND INFLATION STRATEGY

Historical Performance

FUND EXPENSES

(unaudited)

As a shareholder of a mutual fund, you may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, contingent deferred sales charges on redemptions and (2) ongoing costs, including management fees; distribution (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period as indicated below.

Actual Expenses

The table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed annual rate of return of 5% before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds by comparing this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), or contingent deferred sales charges on redemptions. Therefore, the hypothetical example is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Beginning Account Value May 1, 2015		Ending Account Value October 31, 2015		Expenses Paid During Period*		Annualized Expense Ratio*
Class A
Actual	$	1,000	$	996.80	$	3.77		0.75	%
Hypothetical**	$	1,000	$	1,021.42	$	3.82		0.75	%
Class C
Actual	$	1,000	$	993.00	$	7.54		1.50	%
Hypothetical**	$	1,000	$	1,017.64	$	7.63		1.50	%
Advisor Class
Actual	$	1,000	$	997.10	$	2.52		0.50	%
Hypothetical**	$	1,000	$	1,022.68	$	2.55		0.50	%
Class 1
Actual	$	1,000	$	997.80	$	3.02		0.60	%
Hypothetical**	$	1,000	$	1,022.18	$	3.06		0.60	%
Class 2
Actual	$	1,000	$	998.30	$	2.52		0.50	%
Hypothetical**	$	1,000	$	1,022.68	$	2.55		0.50	%

* Expenses are equal to the classes’ annualized expense ratios multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).

** Assumes 5% annual return before expenses.

AB MUNICIPAL BOND INFLATION STRATEGY  • 9

Fund Expenses

PORTFOLIO SUMMARY

October 31, 2015 (unaudited)

PORTFOLIO STATISTICS

Net Assets ($mil): $788.6

* All data are as of October 31, 2015. The Strategy’s quality rating breakdown is expressed as a percentage of the Strategy’s total investments in municipal securities and may vary over time. The Strategy also enters into derivative transactions, which may be used for hedging or investment purposes (see “Portfolio of Investments” section of the report for additional details). The quality ratings are determined by using the Standard & Poor’s Ratings Services (“S&P”), Moody’s Investors Services, Inc. (“Moody’s”) and Fitch Ratings, Ltd.(“Fitch”). The Strategy considers the credit ratings issued by S&P, Moody’s, and Fitch and uses the highest rating issued by the agencies, including when there is a split rating. These ratings are a measure of the quality and safety of a bond or portfolio, based on the issuer’s financial condition. AAA is the highest (best) and D is the lowest (worst). If applicable, the pre-refunded category includes bonds which are secured by US Government Securities and therefore are deemed high-quality investment grade by the Adviser. If applicable, Not Applicable (N/A) includes non credit worthy investments; such as, equities, currency contracts, futures and options. If applicable, the Not Rated category includes bonds that are not rated by a Nationally Recognized Statistical Rating Organization. The Adviser evaluates the creditworthiness of non-rated securities based on a number of factors including, but not limited to, cash flows, enterprise value and economic environment.

10 •  AB MUNICIPAL BOND INFLATION STRATEGY

Portfolio Summary

PORTFOLIO OF INVESTMENTS

October 31, 2015

	Principal Amount (000)		U.S. $ Value
MUNICIPAL OBLIGATIONS – 100.6%
Long-Term Municipal Bonds – 100.6%
Alabama – 0.8%
Alabama Special Care Facilities Financing Authority-Birmingham AL (Children’s Hospital of Alabama Obligated Group (The)) Series 2015 5.00%, 6/01/28	$	3,905	$	4,526,051
County of Jefferson AL Sewer Revenue Series 2013D 5.00%, 10/01/18		1,825		1,964,960
				6,491,011
Alaska – 0.5%
Alaska Industrial Development & Export Authority Series 2010A 5.00%, 4/01/17		400		424,584
City of Valdez AK (BP Pipelines Alaska, Inc.) Series 2011B 5.00%, 1/01/16		3,140		3,163,990
				3,588,574
Arizona – 2.5%
Arizona State University COP Series 2013A 5.00%, 9/01/19-9/01/22		8,345		9,826,253
City of Phoenix Civic Improvement Corp. Series 2011 5.00%, 7/01/26		3,330		3,918,411
County of Pima AZ Sewer System Revenue AGM Series 2010 5.00%, 7/01/21		1,765		2,049,677
Salt River Project Agricultural Improvement & Power District Series 2011A 5.00%, 12/01/24		3,140		3,763,698
				19,558,039
Arkansas – 0.1%
City of Fort Smith AR Sales & Use Tax Revenue Series 2012 2.375%, 5/01/27		130		130,064
City of Springdale AR Sales & Use Tax Revenue Series 2013 2.60%, 7/01/27		525		525,231
				655,295

AB MUNICIPAL BOND INFLATION STRATEGY  • 11

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
California – 2.9%
San Francisco City & County Airports Comm-San Francisco International Airport (San Francisco Intl Airport) Series 2010C 5.00%, 5/01/19	$	450	$	512,113
NATL Series 2006 32F 5.25%, 5/01/18		290		322,843
State of California Series 2006 5.00%, 10/01/16		275		286,869
Series 2011 5.00%, 10/01/20		5,000		5,892,500
Series 2012 5.00%, 9/01/20		9,305		10,948,077
Series 2014 5.00%, 8/01/22-5/01/25		4,250		5,164,651
				23,127,053
Colorado – 3.8%
City & County of Denver CO Airport System Revenue (Denver Intl Airport) Series 2010A 5.00%, 11/15/23		375		435,600
Series 2012A 5.00%, 11/15/24(a)		10,395		11,959,655
5.00%, 11/15/25		3,000		3,435,000
Denver City & County School District No 1 Series 2014B 5.00%, 12/01/23		4,730		5,818,846
Denver Urban Renewal Authority (Stapleton Development Corp.) Series 2010B-1 5.00%, 12/01/19		200		201,078
Series 2013A 5.00%, 12/01/19-12/01/22		5,655		6,477,489
Plaza Metropolitan District No 1 Series 2013 5.00%, 12/01/20(b)		1,310		1,420,263
Regional Transportation District (Denver Transit Partners LLC) Series 2010 5.25%, 7/15/24		440		489,786
				30,237,717
Connecticut – 0.9%
State of Connecticut AMBAC Series 2005B 0.576%, 6/01/16(c)		1,750		1,754,235

12 •  AB MUNICIPAL BOND INFLATION STRATEGY

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
State of Connecticut (State of Connecticut SRF) Series 2013A 5.00%, 3/01/24	$	4,360	$	5,286,674
				7,040,909
Florida – 11.4%
Citizens Property Insurance Corp. Series 2010A-1 5.00%, 6/01/16		315		323,442
Series 2012A 5.00%, 6/01/22		7,315		8,660,667
Series 2012A-1 5.00%, 6/01/16		3,165		3,249,822
City of Jacksonville FL (City of Jacksonville FL Sales Tax) Series 2011 5.00%, 10/01/20		1,720		1,994,099
City of Jacksonville FL (City of Jacksonville FL Transit Sales Tax) Series 2012A 5.00%, 10/01/23-10/01/26		10,190		12,084,812
City of Tampa FL Water & Wastewater System Revenue Series 2011 5.00%, 10/01/26		1,565		1,851,223
County of Miami-Dade FL (County of Miami-Dade FL Non-Ad Valorem) Series 2015A 5.00%, 6/01/23-6/01/27		18,500		21,813,998
County of Miami-Dade FL Spl Tax Series 2012A 5.00%, 10/01/23		1,500		1,786,845
Florida Department of Environmental Protection Series 2011B 5.00%, 7/01/20		3,775		4,404,293
Series 2013A 4.00%, 7/01/16		1,765		1,808,737
5.00%, 7/01/18-7/01/19		3,905		4,390,152
Florida Municipal Power Agency Series 2011B 5.00%, 10/01/23		2,890		3,365,578
Series 2015B 5.00%, 10/01/23		1,500		1,797,285
Florida State Board of Education (State of Florida) Series 2013A 5.00%, 6/01/17(a)		16,440		17,588,334
Series 2015B 5.00%, 6/01/21		1,725		2,057,925

AB MUNICIPAL BOND INFLATION STRATEGY  • 13

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
Martin County Industrial Development Authority (Indiantown Cogeneration LP) Series 2013 4.20%, 12/15/25	$	1,900	$	1,925,384
State of Florida Lottery Revenue Series 2010C 5.00%, 7/01/16		550		567,358
				89,669,954
Georgia – 0.9%
Cherokee County Board of Education Series 2014B 5.00%, 8/01/20		1,000		1,173,110
City of Atlanta Department of Aviation (Hartsfield Jackson Atlanta Intl Airport) Series 2010B 5.00%, 1/01/18		2,500		2,726,475
Municipal Electric Authority of Georgia Series 2011A 5.00%, 1/01/21		3,045		3,562,163
				7,461,748
Idaho – 0.3%
Idaho Health Facilities Authority (The Terraces at Boise) Series 2014 5.25%, 10/01/20		2,390		2,391,338
Illinois – 3.5%
Chicago O’Hare International Airport Series 2011B 5.00%, 1/01/17		1,930		2,023,721
Series 2015B 5.00%, 1/01/29		5,000		5,700,850
Chicago O’Hare International Airport (Chicago O’Hare International Airport Customer Facility Charge) Series 2013 5.25%, 1/01/23		2,500		2,844,300
5.50%, 1/01/25		2,250		2,606,693
Springfield Metropolitan Sanitation District Series 2011A 5.00%, 1/01/21		2,170		2,455,637
State of Illinois Series 2006A 5.00%, 6/01/19		1,040		1,124,292
Series 2010 5.00%, 1/01/18		500		529,120
Series 2013A 5.00%, 4/01/20		4,030		4,398,664

14 •  AB MUNICIPAL BOND INFLATION STRATEGY

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
Series 2014 5.00%, 5/01/30	$	4,180	$	4,377,212
State of Illinois (State of Illinois Sales Tax) Series 2010 5.00%, 6/15/17		1,450		1,549,151
				27,609,640
Indiana – 0.7%
Indiana Municipal Power Agency Series 2011A 5.00%, 1/01/20-1/01/23		4,965		5,730,593
Kentucky – 1.1%
Kentucky Municipal Power Agency NATL Series 2015A 5.00%, 9/01/22-9/01/23		4,875		5,692,046
Kentucky Turnpike Authority Series 2012A 5.00%, 7/01/25		2,275		2,703,110
				8,395,156
Louisiana – 1.3%
State of Louisiana Gasoline & Fuels Tax Revenue Series 2012A 5.00%, 5/01/27		9,085		10,645,985
Maryland – 5.6%
State of Maryland Series 2014B 5.00%, 8/01/20		10,165		11,950,381
5.00%, 8/01/21(a)		26,600		31,848,446
				43,798,827
Massachusetts – 4.3%
Commonwealth of Massachusetts AGM Series 2006C 1.075%, 11/01/19(c)		9,575		9,832,950
NATL Series 2000E 0.105%, 12/01/30(d)		4,525		4,204,277
Commonwealth of Massachusetts (Commonwealth of Massachusetts Fuel Tax) AGM Series 2005A 3.33%, 6/01/20(c)		3,000		3,161,040
Massachusetts Bay Transportation Authority (Massachusetts Bay Transportation Authority Sales Tax) Series 2004B 5.25%, 7/01/21		3,330		4,029,067

AB MUNICIPAL BOND INFLATION STRATEGY  • 15

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
Massachusetts Clean Water Trust (The) (Massachusetts Water Pollution Abatement Trust (The) SRF) Series 2006 0.95%, 8/01/22(c)	$	3,240	$	3,425,814
Massachusetts School Building Authority (Massachusetts School Building Authority Sales Tax) Series 2012A 5.00%, 8/15/23		2,475		2,976,584
Metropolitan Boston Transit Parking Corp. Series 2011 5.00%, 7/01/22-7/01/25		5,025		5,891,807
				33,521,539
Michigan – 2.1%
City of Detroit MI Sewage Disposal System Revenue Series 2012A 5.00%, 7/01/21		3,750		4,224,787
Michigan Finance Authority (City of Detroit MI Water Supply System Revenue) AGM Series 2014D2 5.00%, 7/01/24		10,545		12,290,936
				16,515,723
Minnesota – 1.1%
Minnesota Higher Education Facilities Authority (Gustavus Adolphus College) Series 2010B 5.00%, 10/01/21		1,295		1,466,406
State of Minnesota Series 2015D 5.00%, 8/01/18		6,715		7,487,964
				8,954,370
Mississippi – 0.4%
Mississippi Development Bank (State of Mississippi DOT Lease) Series 2013 5.00%, 1/01/19		1,500		1,685,565
Series 2013A 5.00%, 1/01/19		1,000		1,123,710
				2,809,275
Missouri – 0.2%
City of Springfield MO Public Utility Revenue Series 2012 5.00%, 12/01/17		1,390		1,505,384

16 •  AB MUNICIPAL BOND INFLATION STRATEGY

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
Nevada – 1.4%
City of Reno NV Series 2013A 5.00%, 6/01/19	$	1,000	$	1,122,490
Series 2013B 5.00%, 6/01/19		2,210		2,489,764
County of Clark Department of Aviation (McCarran Intl Airport) Series 2010D 5.00%, 7/01/21-7/01/22		775		887,481
Las Vegas Valley Water District Series 2015A 5.00%, 6/01/20		1,500		1,746,450
Series 2015B 5.00%, 12/01/20		4,250		4,999,233
				11,245,418
New Jersey – 3.0%
Morris-Union Jointure Commission COP AGM Series 2013 5.00%, 8/01/17		2,340		2,458,685
New Jersey Economic Development Authority Series 2010DD-1 5.00%, 12/15/17 (Pre-refunded/ETM)		460		501,427
New Jersey Economic Development Authority (New Jersey Economic Development Authority State Lease) Series 2010DD-1 5.00%, 12/15/17		20		21,061
New Jersey Transportation Trust Fund Authority (New Jersey Transportation Trust Fund Authority State Lease) Series 2013A 5.00%, 6/15/20		10,000		10,851,000
New Jersey Turnpike Authority Series 2013A 5.00%, 1/01/23		1,800		2,146,518
Series 2014A 5.00%, 1/01/28		4,785		5,597,254
Series 2014C 5.00%, 1/01/23		1,590		1,896,091
				23,472,036
New York – 17.4%
City of New York NY Series 2011A 5.00%, 8/01/23		4,250		5,016,572
Series 2014J 5.00%, 8/01/21		6,100		7,236,979

AB MUNICIPAL BOND INFLATION STRATEGY  • 17

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
AGM Series 2005K 1.66%, 8/01/16(c)	$	1,700	$	1,718,530
Metropolitan Transportation Authority Series 2012C 5.00%, 11/15/24-11/15/25		9,065		10,780,345
Series 2012F 5.00%, 11/15/26		3,635		4,291,990
Series 2013A 5.00%, 11/15/26		2,300		2,697,624
Series 2013E 5.00%, 11/15/25		8,510		10,110,476
New York City Industrial Development Agency (American Airlines, Inc.) Series 2015B 2.00%, 8/01/28(e)		4,135		4,143,146
New York City Municipal Water Finance Authority Series 2011HH 5.00%, 6/15/26		3,875		4,561,379
New York City Transitional Finance Authority Future Tax Secured Revenue Series 200213-CONV 5.00%, 11/01/16		6,650		6,960,621
Series 2012B 5.00%, 11/01/26(a)		6,830		8,165,675
New York State Dormitory Authority (State of New York Pers Income Tax) Series 2011C 5.00%, 3/15/25		3,000		3,522,240
Series 2012A 5.00%, 12/15/22(a)		14,610		17,685,843
Series 2012B 5.00%, 3/15/20		7,900		9,187,147
Series 2014A 5.00%, 2/15/28		6,565		7,731,732
New York State Environmental Facilities Corp. (New York City Municipal Water Finance Authority) Series 2011 5.00%, 6/15/25		3,000		3,561,480
New York State Thruway Authority (New York State Thruway Authority Ded Tax) Series 2012A 5.00%, 4/01/21		17,025		20,177,179
Triborough Bridge & Tunnel Authority Series 2012B 5.00%, 11/15/19		4,360		5,036,018
Series 2013B 5.00%, 11/15/20		4,100		4,845,175
				137,430,151

18 •  AB MUNICIPAL BOND INFLATION STRATEGY

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
North Carolina – 2.3%
North Carolina Eastern Municipal Power Agency Series 2012B 5.00%, 1/01/21 (Pre-refunded/ETM)	$	6,700	$	7,932,800
State of North Carolina Series 2013E 5.00%, 5/01/16		2,330		2,385,524
State of North Carolina (State of North Carolina Fed Hwy Grant) Series 2015 5.00%, 3/01/26		6,710		7,925,986
				18,244,310
Ohio – 0.1%
City of Cleveland OH COP Series 2010A 5.00%, 11/15/17		700		747,509
Oregon – 1.9%
Deschutes County Administrative School District No 1 Bend-La Pine Series 2013 5.00%, 6/15/20		5,180		6,063,397
Tri-County Metropolitan Transportation District Series 2011A 5.00%, 10/01/25		4,605		5,354,418
Washington & Multnomah Counties School District No 48J Beaverton Series 2014 5.00%, 6/15/21		3,195		3,810,037
				15,227,852
Pennsylvania – 6.3%
Allegheny County Sanitary Authority AGM Series 2011 5.00%, 6/01/19		2,250		2,544,075
City of Philadelphia PA Water & Wastewater Revenue AGM Series 2010A 5.00%, 6/15/18		550		607,519
Commonwealth of Pennsylvania Series 2014 5.00%, 7/01/17		5,000		5,359,000
Montgomery County Industrial Development Authority/PA Series 2010 5.00%, 8/01/19 (Pre-refunded/ETM)		475		545,167
Moon Industrial Development Authority (Baptist Home Society Obligated Group) Series 2015 5.125%, 7/01/25		2,060		2,068,425

AB MUNICIPAL BOND INFLATION STRATEGY  • 19

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
Pennsylvania Economic Development Financing Authority (Commonwealth of Pennsylvania Unemployment) Series 2012A 5.00%, 7/01/18-1/01/19	$	13,085	$	14,600,252
Series 2012B 5.00%, 7/01/21		7,550		8,216,891
Pennsylvania Economic Development Financing Authority (FirstEnergy Nuclear Generation LLC) Series 2005A 3.75%, 12/01/40		3,055		3,132,414
Pennsylvania Industrial Development Authority Series 2012 5.00%, 7/01/16 (Pre-refunded/ETM)		1,840		1,897,077
5.00%, 7/01/16		3,160		3,256,728
School District of Philadelphia (The) Series 2011E 5.25%, 9/01/22		1,800		2,034,108
State Public School Building Authority (School District of Philadelphia (The)) Series 2012 5.00%, 4/01/23-4/01/26		5,150		5,750,251
				50,011,907
Puerto Rico – 0.4%
Puerto Rico Electric Power Authority NATL Series 2002 5.00%, 7/01/19		3,400		3,450,830
South Carolina – 0.8%
Renewable Water Resources Series 2012 5.00%, 1/01/24		2,570		2,993,510
South Carolina State Public Service Authority Series 2012C 5.00%, 12/01/15		3,200		3,212,608
				6,206,118
Tennessee – 0.4%
Metropolitan Government of Nashville & Davidson County TN Series 2012 5.00%, 7/01/23		2,385		2,860,164
Texas – 8.8%
Austin Community College District Public Facility Corp. Series 2015 5.00%, 8/01/19		1,000		1,134,290

20 •  AB MUNICIPAL BOND INFLATION STRATEGY

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
Birdville Independent School District Series 2015B 5.00%, 2/15/22	$	3,825	$	4,583,880
City of Corpus Christi TX Utility System Revenue Series 2012 5.00%, 7/15/21		5,675		6,674,197
City of Garland TX Series 2010 5.00%, 2/15/26		500		573,400
City of Houston TX Airport System Revenue Series 2011A 5.00%, 7/01/19		2,105		2,355,095
City of Houston TX Combined Utility System Revenue Series 2011D 5.00%, 11/15/27		2,735		3,239,881
City of Lubbock TX Series 2013 5.00%, 2/15/19		1,740		1,963,451
City Public Service Board of San Antonio TX Series 2012 5.00%, 2/01/21		7,110		8,391,222
Conroe Independent School District Series 2011 5.00%, 2/15/24-2/15/26		6,240		7,200,391
Harris County-Houston Sports Authority Series 2014A 5.00%, 11/15/21		4,220		4,969,936
North Texas Tollway Authority (North Texas Tollway Authority Special Projects System) Series 2011D 5.25%, 9/01/26		3,625		4,329,048
Rockwall Independent School District Series 2013 5.00%, 2/15/19(a)		3,280		3,712,566
San Antonio Independent School District/TX Series 2011 5.00%, 8/15/26		1,710		1,990,047
Spring Branch Independent School District Series 2014B 5.00%, 2/01/21		3,485		4,112,997
Tarrant County Cultural Education Facilities Finance Corp. (Buckingham Senior Living Community, Inc.) Series 2015I 5.25%, 11/15/35		900		920,412

AB MUNICIPAL BOND INFLATION STRATEGY  • 21

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
Texas Public Finance Authority (State of Texas Unemployment) Series 2014A 5.00%, 1/01/17	$	11,605	$	12,222,618
University of Texas System (The) Series 2010A 5.00%, 8/15/22		1,070		1,237,198
				69,610,629
Virginia – 1.7%
Fairfax County Economic Development Authority (Fairfax County EDA Transportation Impt Dist) Series 2011 5.00%, 4/01/25-4/01/26		6,000		6,895,280
Virginia College Building Authority (Virginia College Building Authority State Lease) Series 2011A 5.00%, 2/01/21		5,240		6,190,064
				13,085,344
Washington – 9.2%
Central Puget Sound Regional Transit Authority Series 2012P 5.00%, 2/01/23-2/01/25		7,815		9,380,757
Chelan County Public Utility District No 1 Series 2011B 5.50%, 7/01/25		3,305		3,893,720
City of Seattle WA Series 2015A 5.00%, 6/01/19		9,770		11,146,398
City of Seattle WA Municipal Light & Power Revenue Series 2015A 5.00%, 5/01/18		2,070		2,284,597
City of Tacoma WA Electric System Revenue Series 2013A 5.00%, 1/01/19-1/01/20		4,000		4,561,955
Energy Northwest (Bonneville Power Administration) Series 2011A 5.00%, 7/01/18		680		755,725
Series 2012A 5.00%, 7/01/19		4,200		4,810,134
King County School District No 414 Lake Washington AGM Series 2007 5.00%, 12/01/16		3,735		3,922,833
Port of Seattle WA Series 2013 5.00%, 7/01/24		4,820		5,549,796

22 •  AB MUNICIPAL BOND INFLATION STRATEGY

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
State of Washington Series 20092010B 5.00%, 1/01/22	$	710	$	819,106
Series 20102010E 5.00%, 2/01/19		3,295		3,724,470
Series 2013D 5.00%, 2/01/23		3,385		4,099,370
Series 2015R 5.00%, 7/01/26		13,325		16,170,021
Washington State Housing Finance Commission (Heron’s Key Obligated Group) Series 2015B 4.375%, 1/01/21(b)		1,250		1,266,212
				72,385,094
Wisconsin – 2.5%
State of Wisconsin Clean Water Fund Leveraged Loan Portfolio (State of Wisconsin SRF) Series 20131 5.00%, 6/01/24		4,490		5,428,904
Wisconsin Department of Transportation Series 20131 5.00%, 7/01/23-7/01/24		12,000		14,535,945
				19,964,849
Total Municipal Obligations (cost $766,879,634)				793,650,341
CORPORATES – INVESTMENT GRADE – 3.5%
Financial Institutions – 3.5%
Banking – 3.5%
Bank of America Corp. 6.50%, 8/01/16		2,585		2,690,134
Capital One Bank USA NA 1.20%, 2/13/17		8,300		8,254,931
JPMorgan Chase & Co. 1.35%, 2/15/17		8,885		8,900,389
Morgan Stanley 1.75%, 2/25/16		3,362		3,373,942
Series G 5.45%, 1/09/17		4,030		4,221,401
Total Corporates – Investment Grade (cost $27,470,157)				27,440,797

AB MUNICIPAL BOND INFLATION STRATEGY  • 23

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
GOVERNMENTS – TREASURIES – 1.6%
United States – 1.6%
U.S. Treasury Notes 0.375%, 1/15/16-1/31/16(a)	$	6,100	$	6,103,216
0.625%, 8/31/17(a)		6,200		6,190,229
Total Governments – Treasuries (cost $12,295,759)				12,293,445
Total Investments – 105.7% (cost $806,645,550)				833,384,583
Other assets less liabilities – (5.7)%				(44,806,054	)
Net Assets – 100.0%			$	788,578,529

INFLATION (CPI) SWAPS (see Note D)

					Rate Type
Swap Counterparty	Notional Amount (000)		Termination Date		Payments made by the Fund			Payments received by the Fund			Unrealized Appreciation/ (Depreciation)
Bank of America, NA	$	25,000		9/02/20		1.548	%		CPI	#	$	(142,240	)
Barclays Bank PLC		6,000		2/26/17		2.370	%		CPI	#		(410,502	)
Barclays Bank PLC		3,000		7/19/17		2.038	%		CPI	#		(107,601	)
Barclays Bank PLC		37,000		8/07/17		2.124	%		CPI	#		(1,516,521	)
Barclays Bank PLC		5,500		6/02/19		2.580	%		CPI	#		(576,071	)
Barclays Bank PLC		4,000		6/15/20		2.480	%		CPI	#		(412,154	)
Barclays Bank PLC		35,000		7/02/20		2.256	%		CPI	#		(2,378,735	)
Barclays Bank PLC		1,500		8/04/20		2.308	%		CPI	#		(118,027	)
Barclays Bank PLC		2,000		11/10/20		2.500	%		CPI	#		(196,274	)
Barclays Bank PLC		6,000		5/04/21		2.845	%		CPI	#		(904,923	)
Barclays Bank PLC		3,000		5/12/21		2.815	%		CPI	#		(444,226	)
Barclays Bank PLC		14,000		4/03/22		2.663	%		CPI	#		(1,900,231	)
Barclays Bank PLC		16,700		10/05/22		2.765	%		CPI	#		(2,288,597	)
Barclays Bank PLC		25,000		8/07/24		2.573	%		CPI	#		(2,670,573	)
Barclays Bank PLC		19,000		5/05/25		2.125	%		CPI	#		(686,848	)
Barclays Bank PLC		5,400		3/06/27		2.695	%		CPI	#		(879,493	)
Citibank, NA		10,000		5/04/16		2.710	%		CPI	#		(706,407	)
Citibank, NA		14,000		5/30/17		2.125	%		CPI	#		(775,127	)
Citibank, NA		11,500		6/21/17		2.153	%		CPI	#		(648,675	)
Citibank, NA		22,000		7/02/18		2.084	%		CPI	#		(1,029,344	)
Citibank, NA		9,000		6/29/22		2.398	%		CPI	#		(950,906	)
Citibank, NA		5,400		7/19/22		2.400	%		CPI	#		(557,325	)
Citibank, NA		4,000		8/10/22		2.550	%		CPI	#		(468,252	)
Citibank, NA		15,500		12/07/22		2.748	%		CPI	#		(2,186,592	)
Citibank, NA		47,000		5/24/23		2.533	%		CPI	#		(5,362,981	)
Citibank, NA		30,000		10/29/23		2.524	%		CPI	#		(3,142,052	)
Citibank, NA		15,800		2/08/28		2.940	%		CPI	#		(3,114,476	)
Deutsche Bank AG		11,000		6/20/21		2.655	%		CPI	#		(1,462,259	)
Deutsche Bank AG		9,800		9/07/21		2.400	%		CPI	#		(1,009,397	)
Deutsche Bank AG		25,000		9/02/25		1.880	%		CPI	#		(289,562	)

24 •  AB MUNICIPAL BOND INFLATION STRATEGY

Portfolio of Investments

					Rate Type
Swap Counterparty	Notional Amount (000)		Termination Date		Payments made by the Fund			Payments received by the Fund			Unrealized Appreciation/ (Depreciation)
JPMorgan Chase Bank, NA	$	1,000		7/29/20		2.305	%		CPI	#	$	(78,928	)
JPMorgan Chase Bank, NA		19,000		8/17/22		2.523	%		CPI	#		(2,149,324	)
JPMorgan Chase Bank, NA		1,400		6/30/26		2.890	%		CPI	#		(283,509	)
JPMorgan Chase Bank, NA		3,300		7/21/26		2.935	%		CPI	#		(698,092	)
JPMorgan Chase Bank, NA		2,400		10/03/26		2.485	%		CPI	#		(308,464	)
JPMorgan Chase Bank, NA		5,400		11/14/26		2.488	%		CPI	#		(701,406	)
JPMorgan Chase Bank, NA		4,850		12/23/26		2.484	%		CPI	#		(616,291	)
JPMorgan Chase Bank, NA		21,350		2/20/28		2.899	%		CPI	#		(4,045,594	)
JPMorgan Chase Bank, NA		12,000		3/26/28		2.880	%		CPI	#		(2,243,237	)
Morgan Stanley Capital Services LLC		6,000		4/05/16		2.535	%		CPI	#		(355,217	)
Morgan Stanley Capital Services LLC		6,000		4/16/16		2.110	%		CPI	#		(236,514	)
Morgan Stanley Capital Services LLC		50,000		4/16/18		2.395	%		CPI	#		(3,493,275	)
Morgan Stanley Capital Services LLC		2,000		10/14/20		2.370	%		CPI	#		(166,247	)
Morgan Stanley Capital Services LLC		13,000		5/23/21		2.680	%		CPI	#		(1,729,215	)
Morgan Stanley Capital Services LLC		10,000		4/16/23		2.690	%		CPI	#		(1,329,644	)
Morgan Stanley Capital Services LLC		5,000		8/15/26		2.885	%		CPI	#		(1,004,931	)
											$	(56,776,259	)

# Variable interest rate based on the rate of inflation as determined by the Consumer Price Index (CPI).

AB MUNICIPAL BOND INFLATION STRATEGY  • 25

Portfolio of Investments

INTEREST RATE SWAPS (see Note D)

					Rate Type
Swap Counterparty	Notional Amount (000)		Termination Date		Payments made by the Fund			Payments received by the Fund			Unrealized Appreciation/ (Depreciation)
Citibank, NA	$	4,000		11/02/23		1.308	%		SIFMA	*	$	(1,689	)
JPMorgan Chase Bank, NA		24,100		10/26/22		1.123	%		SIFMA	*		88,268
											$	86,579

* Variable interest rate based on the Securities Industry & Financial Markets Association (SIFMA) Municipal Swap Index.

(a) Position, or a portion thereof, has been segregated to collateralize OTC derivatives outstanding.

(b) Security is exempt from registration under Rule 144A of the Securities Act of 1933. These securities are considered liquid and may be resold in transactions exempt from registration, normally to qualified institutional buyers. At October 31, 2015, the aggregate market value of these securities amounted to $2,686,475 or 0.3% of net assets.

(c) Variable rate coupon, rate shown as of October 31, 2015.

(d) An auction rate security whose interest rate resets at each auction date. Auctions are typically held every week or month. The rate shown is as of October 31, 2015 and the aggregate market value of this security amounted to $4,204,277 or 0.53% of net assets.

(e) Coupon rate adjusts periodically based upon a predetermined schedule. Stated interest rate in effect at October 31, 2015.

As of October 31, 2015, the Strategy’s percentages of investments in municipal bonds that are insured and in insured municipal bonds that have been pre-refunded or escrowed to maturity are 6.8% and 0.0%, respectively.

Glossary:

AGM – Assured Guaranty Municipal

AMBAC – Ambac Assurance Corporation

COP – Certificate of Participation

DOT – Department of Transportation

EDA – Economic Development Agency

ETM – Escrowed to Maturity

NATL – National Interstate Corporation

SRF – State Revolving Fund

See notes to financial statements.

26 •  AB MUNICIPAL BOND INFLATION STRATEGY

Portfolio of Investments

STATEMENT OF ASSETS & LIABILITIES

October 31, 2015

Assets
Investments in securities, at value
Unaffiliated issuers (cost $806,645,550)	$	833,384,583
Cash		2,154,053
Interest receivable		10,398,290
Receivable for capital stock sold		476,715
Receivable for investment securities sold		120,000
Unrealized appreciation on interest rate swaps		88,268
Total assets		846,621,909
Liabilities
Unrealized depreciation on inflation swaps		56,776,259
Payable for capital stock redeemed		761,075
Advisory fee payable		266,206
Distribution fee payable		53,187
Administrative fee payable		18,143
Transfer Agent fee payable		10,602
Unrealized depreciation on interest rate swaps		1,689
Accrued expenses		156,219
Total liabilities		58,043,380
Net Assets	$	788,578,529
Composition of Net Assets
Capital stock, at par	$	77,912
Additional paid-in capital		821,998,475
Undistributed net investment income		1,091,678
Accumulated net realized loss on investment transactions		(4,638,889	)
Net unrealized depreciation on investments		(29,950,647	)
	$	788,578,529

Net Asset Value Per Share—27 billion shares of capital stock authorized, $.001 par value

Class	Net Assets		Shares Outstanding		Net Asset Value
A	$	41,121,342		4,055,326	$	10.14	*
C	$	13,154,190		1,299,858	$	10.12
Advisor	$	171,788,589		16,933,460	$	10.14
1	$	386,448,106		38,221,440	$	10.11
2	$	176,066,302		17,402,311	$	10.12

* The maximum offering price per share for Class A shares was $10.45 which reflects a sales charge of 3.0%.

See notes to financial statements.

AB MUNICIPAL BOND INFLATION STRATEGY  • 27

Statement of Assets & Liabilities

STATEMENT OF OPERATIONS

Year Ended October 31, 2015

Investment Income
Interest	$	18,767,586
Dividends—Affiliated issuers		11,667		$	18,779,253
Expenses
Advisory fee (see Note B)		4,151,538
Distribution fee—Class A		132,034
Distribution fee—Class C		169,905
Distribution fee—Class 1		400,283
Transfer agency—Class A		21,590
Transfer agency—Class C		7,439
Transfer agency—Advisor Class		79,278
Transfer agency—Class 1		1,861
Transfer agency—Class 2		846
Custodian		186,317
Registration fees		92,232
Audit and tax		82,260
Administrative		54,539
Printing		51,548
Legal		42,068
Directors’ fees		17,017
Miscellaneous		29,255
Total expenses		5,520,010
Less: expenses waived and reimbursed by the Adviser (see Note B)		(664,123	)
Net expenses					4,855,887
Net investment income					13,923,366
Realized and Unrealized Gain (Loss) on Investment Transactions
Net realized loss on:
Investment transactions					(89,113	)
Swaps					(1,360,153	)
Net change in unrealized appreciation/depreciation of:
Investments					3,980,212
Swaps					(30,732,129	)
Net loss on investment transactions					(28,201,183	)
Net Decrease in Net Assets from Operations				$	(14,277,817	)

See notes to financial statements.

28 •  AB MUNICIPAL BOND INFLATION STRATEGY

Statement of Operations

STATEMENT OF CHANGES IN NET ASSETS

	Year Ended October 31, 2015			Year Ended October 31, 2014
Increase (Decrease) in Net Assets from Operations
Net investment income	$	13,923,366		$	12,962,394
Net realized loss on investment transactions		(1,449,266	)		(3,189,623	)
Net change in unrealized appreciation/depreciation of investments		(26,751,917	)		13,370,123
Net increase (decrease) in net assets from operations		(14,277,817	)		23,142,894
Dividends and Distributions to Shareholders from
Net investment income
Class A		(729,938	)		(916,215	)
Class C		(119,694	)		(109,940	)
Advisor Class		(3,103,460	)		(2,396,855	)
Class 1		(6,702,371	)		(6,290,282	)
Class 2		(3,244,378	)		(2,769,394	)
Net realized gain on investment transactions
Class A		– 0	–		(2,586	)
Class C		– 0	–		(790	)
Advisor Class		– 0	–		(4,191	)
Class 1		– 0	–		(12,245	)
Class 2		– 0	–		(5,233	)
Capital Stock Transactions
Net decrease		(43,450,132	)		(58,073,019	)
Total decrease		(71,627,790	)		(47,437,856	)
Net Assets
Beginning of period		860,206,319			907,644,175
End of period (including undistributed net investment income of $1,091,678 and $1,011,224, respectively)	$	788,578,529		$	860,206,319

See notes to financial statements.

AB MUNICIPAL BOND INFLATION STRATEGY  • 29

Statement of Changes in Net Assets

NOTES TO FINANCIAL STATEMENTS

October 31, 2015

NOTE A

Significant Accounting Policies

AB Bond Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940 as an open-end management investment company. Prior to January 20, 2015, the Fund was known as AllianceBernstein Bond Fund, Inc. The Fund, which is a Maryland corporation, operates as a series company comprised of nine portfolios currently in operation: the AB Intermediate Bond Portfolio, the AB Bond Inflation Strategy Portfolio, the AB Municipal Bond Inflation Strategy Portfolio, the AB All Market Real Return Portfolio, the AB Limited Duration High Income Portfolio, the AB Government Reserves Portfolio, the AB Tax-Aware Fixed Income Portfolio, the AB Credit Long/Short Portfolio and the AB High Yield Portfolio. They are each diversified portfolios, with the exception of the AB Credit Long/Short Portfolio and the AB High Yield Portfolio, which are non-diversified. Each portfolio is considered to be a separate entity for financial reporting and tax purposes. This report relates only to the AB Municipal Bond Inflation Strategy Portfolio (the “Strategy”). Prior to January 20, 2015, the Strategy was known as AllianceBernstein Municipal Bond Inflation Strategy Portfolio. The Strategy offers Class A, Class C, Advisor Class, Class 1 and Class 2 shares. Class 1 shares are sold only to the private clients of Sanford C. Bernstein & Co. LLC by its registered representatives. Class B, Class R, Class K and Class I shares have been authorized by the Strategy but are not currently being offered. Class A shares are sold with a front-end sales charge of up to 3.0% for purchases not exceeding $500,000. With respect to purchases of $500,000 or more, Class A shares redeemed within one year of purchase may be subject to a contingent deferred sales charge of 1%. Class C shares are subject to a contingent deferred sales charge of 1% on redemptions made within the first year after purchase. Advisor Class, Class I, and Class 2 shares are sold without an initial or contingent deferred sales charge and are not subject to ongoing distribution expenses. Class 1 shares are sold without an initial or contingent deferred sales charge, but are subject to ongoing distribution expenses. All nine classes of shares have identical voting, dividend, liquidation and other rights, except that the classes bear different distribution and transfer agency expenses. Each class has exclusive voting rights with respect to its distribution plan. The financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) which require management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements and amounts of income and expenses during the reporting period. Actual results could differ from those estimates. The Fund is an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. The following is a summary of significant accounting policies followed by the Strategy.

1. Security Valuation

Portfolio securities are valued at their current market value determined on the basis of market quotations or, if market quotations are not readily available or are deemed unreliable, at “fair value” as determined in accordance with procedures established by and under the general supervision of the Fund’s Board of Directors (the “Board”).

30 •  AB MUNICIPAL BOND INFLATION STRATEGY

Notes to Financial Statements

In general, the market values of securities which are readily available and deemed reliable are determined as follows: securities listed on a national securities exchange (other than securities listed on the NASDAQ Stock Market, Inc. (“NASDAQ”)) or on a foreign securities exchange are valued at the last sale price at the close of the exchange or foreign securities exchange. If there has been no sale on such day, the securities are valued at the last traded price from the previous day. Securities listed on more than one exchange are valued by reference to the principal exchange on which the securities are traded; securities listed only on NASDAQ are valued in accordance with the NASDAQ Official Closing Price; listed or over the counter (“OTC”) market put or call options are valued at the mid level between the current bid and ask prices. If either a current bid or current ask price is unavailable, AllianceBernstein L.P. (the “Adviser”) will have discretion to determine the best valuation (e.g. last trade price in the case of listed options); open futures are valued using the closing settlement price or, in the absence of such a price, the most recent quoted bid price. If there are no quotations available for the day of valuation, the last available closing settlement price is used; U.S. Government securities and any other debt instruments having 60 days or less remaining until maturity are generally valued at market by an independent pricing vendor, if a market price is available. If a market price is not available, the securities are valued at amortized cost. This methodology is commonly used for short term securities that have an original maturity of 60 days or less, as well as short term securities that had an original term to maturity that exceeded 60 days. In instances when amortized cost is utilized, the Valuation Committee (the “Committee”) must reasonably conclude that the utilization of amortized cost is approximately the same as the fair value of the security. Such factors the Committee will consider include, but are not limited to, an impairment of the creditworthiness of the issuer or material changes in interest rates. Fixed-income securities, including mortgage-backed and asset-backed securities, may be valued on the basis of prices provided by a pricing service or at a price obtained from one or more of the major broker-dealers. In cases where broker-dealer quotes are obtained, the Adviser may establish procedures whereby changes in market yields or spreads are used to adjust, on a daily basis, a recently obtained quoted price on a security. Swaps and other derivatives are valued daily, primarily using independent pricing services, independent pricing models using market inputs, as well as third party broker-dealers or counterparties. Investment companies are valued at their net asset value each day.

Securities for which market quotations are not readily available (including restricted securities) or are deemed unreliable are valued at fair value. Factors considered in making this determination may include, but are not limited to, information obtained by contacting the issuer, analysts, analysis of the issuer’s financial statements or other available documents. In addition, the Strategy may use fair value pricing for securities primarily traded in non-U.S. markets because most foreign markets close well before the Strategy values its securities at 4:00 p.m., Eastern Time. The earlier close of these foreign markets gives rise to the possibility that significant events, including broad market moves, may have occurred in the interim and may materially affect the value of those securities.

AB MUNICIPAL BOND INFLATION STRATEGY  • 31

Notes to Financial Statements

2. Fair Value Measurements

In accordance with U.S. GAAP regarding fair value measurements, fair value is defined as the price that the Strategy would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP establishes a framework for measuring fair value, and a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability (including those valued based on their market values as described in Note A.1 above). Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Strategy. Unobservable inputs reflect the Strategy’s own assumptions about the assumptions that market participants would use in pricing the asset or liability based on the best information available in the circumstances. Each investment is assigned a level based upon the observability of the inputs which are significant to the overall valuation. The three-tier hierarchy of inputs is summarized below.

• Level 1—quoted prices in active markets for identical investments

• Level 2—other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

• Level 3—significant unobservable inputs (including the Strategy’s own assumptions in determining the fair value of investments)

The fair value of debt instruments, such as bonds, and over-the-counter derivatives is generally based on market price quotations, recently executed market transactions (where observable) or industry recognized modeling techniques and are generally classified as Level 2. Pricing vendor inputs to Level 2 valuations may include quoted prices for similar investments in active markets, interest rates, coupon rates, yield curves, option adjusted spreads, default rates, credit spreads and other unique security features in order to estimate the relevant cash flows which is then discounted to calculate fair values. If these inputs are unobservable and significant to the fair value, these investments will be classified as Level 3. In addition, non-agency rated investments are classified as Level 3.

Other fixed income investments, including non-U.S. government and corporate debt, are generally valued using quoted market prices, if available, which are typically impacted by current interest rates, maturity dates and any perceived credit risk of the issuer. Additionally, in the absence of quoted market prices, these inputs are used by pricing vendors to derive a valuation based upon industry or proprietary models which incorporate issuer specific data with relevant yield/spread comparisons with more widely quoted bonds with similar key characteristics. Those investments for which there are observable inputs are classified as Level 2. Where the inputs are not observable, the investments are classified as Level 3.

32 •  AB MUNICIPAL BOND INFLATION STRATEGY

Notes to Financial Statements

The following table summarizes the valuation of the Strategy’s investments by the above fair value hierarchy levels as of October 31, 2015:

Investments in Securities:	Level 1			Level 2			Level 3			Total
Assets:
Long-Term Municipal Bonds	$	– 0	–	$	781,859,530		$	11,790,811		$	793,650,341
Corporates – Investment Grade		– 0	–		27,440,797			– 0	–		27,440,797
Governments – Treasuries		– 0	–		12,293,445			– 0	–		12,293,445
Total Investments in Securities		– 0	–		821,593,772			11,790,811			833,384,583
Other Financial Instruments*:
Assets:
Interest Rate Swaps		– 0	–		88,268			– 0	–		88,268
Liabilities:
Inflation (CPI) Swaps		– 0	–		(56,776,259	)		– 0	–		(56,776,259	)
Interest Rate Swaps		– 0	–		(1,689	)		– 0	–		(1,689	)
Total^	$	– 0	–	$	764,904,092		$	11,790,811		$	776,694,903

* Other financial instruments are derivative instruments, such as futures, forwards and swaps, which are valued at the unrealized appreciation/depreciation on the instrument.

^ There were no transfers between any levels during the reporting period.

The Strategy recognizes all transfers between levels of the fair value hierarchy assuming the financial instruments were transferred at the beginning of the reporting period.

The following is a reconciliation of investments in which significant unobservable inputs (Level 3) were used in determining fair value.

	Long-Term Municipal Bonds			Total
Balance as of 10/31/14	$	3,858,510		$	3,858,510
Accrued discounts/(premiums)		(18,194	)		(18,194	)
Realized gain (loss)		– 0	–		– 0	–
Change in unrealized appreciation/depreciation		29,696			29,696
Purchases		7,920,799			7,920,799
Sales		– 0	–		– 0	–
Transfers in to Level 3		– 0	–		– 0	–
Transfers out of Level 3		– 0	–		– 0	–
Balance as of 10/31/15	$	11,790,811		$	11,790,811
Net change in unrealized appreciation/depreciation from investments held as of 10/31/15*	$	29,696		$	29,696

* The unrealized appreciation/depreciation is included in net change in unrealized appreciation/depreciation on investments and other financial instruments in the accompanying statement of operations.

AB MUNICIPAL BOND INFLATION STRATEGY  • 33

Notes to Financial Statements

As of October 31, 2015, all Level 3 securities were priced by third party vendors.

The Adviser established the Committee to oversee the pricing and valuation of all securities held in the Strategy. The Committee operates under pricing and valuation policies and procedures established by the Adviser and approved by the Board, including pricing policies which set forth the mechanisms and processes to be employed on a daily basis to implement these policies and procedures. In particular, the pricing policies describe how to determine market quotations for securities and other instruments. The Committee’s responsibilities include: 1) fair value and liquidity determinations (and oversight of any third parties to whom any responsibility for fair value and liquidity determinations is delegated), and 2) regular monitoring of the Adviser’s pricing and valuation policies and procedures and modification or enhancement of these policies and procedures (or recommendation of the modification of these policies and procedures) as the Committee believes appropriate.

The Committee is also responsible for monitoring the implementation of the pricing policies by the Adviser’s Pricing Group (the “Pricing Group”) and a third party which performs certain pricing functions in accordance with the pricing policies. The Pricing Group is responsible for the oversight of the third party on a day-to-day basis. The Committee and the Pricing Group perform a series of activities to provide reasonable assurance of the accuracy of prices including: 1) periodic vendor due diligence meetings, review of methodologies, new developments and processes at vendors, 2) daily comparison of security valuation versus prior day for all securities that exceeded established thresholds, and 3) daily review of unpriced, stale, and variance reports with exceptions reviewed by senior management and the Committee.

In addition, several processes outside of the pricing process are used to monitor valuation issues including: 1) performance and performance attribution reports are monitored for anomalous impacts based upon benchmark performance, and 2) portfolio managers review all portfolios for performance and analytics (which are generated using the Adviser’s prices).

3. Taxes

It is the Strategy’s policy to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its investment company taxable income and net realized gains, if any, to shareholders. Therefore, no provisions for federal income or excise taxes are required.

In accordance with U.S. GAAP requirements regarding accounting for uncertainties in income taxes, management has analyzed the Strategy’s tax positions taken or expected to be taken on federal and state income tax returns for all open tax years (the current and the prior three tax years) and has concluded that no provision for income tax is required in the Strategy’s financial statements.

34 •  AB MUNICIPAL BOND INFLATION STRATEGY

Notes to Financial Statements

4. Investment Income and Investment Transactions

Dividend income is recorded on the ex-dividend date or as soon as the Strategy is informed of the dividend. Interest income is accrued daily. Investment transactions are accounted for on the date the securities are purchased or sold. Investment gains or losses are determined on the identified cost basis. The Strategy amortizes premiums and accretes original issue discounts and market discounts as adjustments to interest income.

5. Class Allocations

All income earned and expenses incurred by the Strategy are borne on a pro-rata basis by each outstanding class of shares, based on the proportionate interest in the Strategy represented by the net assets of such class, except for class specific expenses which are allocated to the respective class. Expenses of the Fund are charged proportionately to each Strategy or based on other appropriate methods. Realized and unrealized gains and losses are allocated among the various share classes based on respective net assets.

6. Dividends and Distributions

Dividends and distributions to shareholders, if any, are recorded on the ex-dividend date. Income dividends and capital gains distributions are determined in accordance with federal tax regulations and may differ from those determined in accordance with U.S. GAAP. To the extent these differences are permanent, such amounts are reclassified within the capital accounts based on their federal tax basis treatment; temporary differences do not require such reclassification.

NOTE B

Advisory Fee and Other Transactions with Affiliates

Under the terms of the investment advisory agreement, the Strategy pays the Adviser an advisory fee at an annual rate of .50% of the first $2.5 billion, .45% of the next $2.5 billion and .40% in excess of $5 billion, of the Strategy’s average daily net assets. The fee is accrued daily and paid monthly. The Adviser has agreed to waive its fees and bear certain expenses to the extent necessary to limit total operating expenses on an annual basis (the “Expense Caps”) .75% (.80% prior to January 30, 2015), 1.50%, .50%, .60% and .50% of the daily average net assets for the Class A, Class C, Advisor Class, Class 1 and Class 2 shares, respectively. This fee waiver and/or expense reimbursement agreement will remain in effect until January 29, 2016 and then may be extended by the Adviser for additional one-year terms. For the year ended October 31, 2015, such reimbursement/waivers amounted to $664,123.

Pursuant to the investment advisory agreement, the Strategy may reimburse the Adviser for certain legal and accounting services provided to the Strategy by the Adviser. For the year ended October 31, 2015, the reimbursement for such services amounted to $54,539.

AB MUNICIPAL BOND INFLATION STRATEGY  • 35

Notes to Financial Statements

The Strategy compensates AllianceBernstein Investor Services, Inc. (“ABIS”), a wholly-owned subsidiary of the Adviser, under a Transfer Agency Agreement for providing personnel and facilities to perform transfer agency services for the Strategy. ABIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. Such compensation retained by ABIS amounted to $55,822 for the year ended October 31, 2015.

AllianceBernstein Investments, Inc. (the “Distributor”), a wholly-owned subsidiary of the Adviser, serves as the distributor of the Strategy’s shares. The Distributor has advised the Strategy that it has retained front-end sales charges of $0 from the sale of Class A shares and received $5,626 and $619 in contingent deferred sales charges imposed upon redemptions by shareholders of Class A and Class C shares, respectively, for the year ended October 31, 2015.

The Strategy may invest in the AB Fixed-Income Shares, Inc.—Government STIF Portfolio (“Government STIF Portfolio”), an open-end management investment company managed by the Adviser. The Government STIF Portfolio is offered as a cash management option to mutual funds and other institutional accounts of the Adviser, and is not available for direct purchase by members of the public. The Government STIF Portfolio pays no investment management fees but does bear its own expenses. A summary of the Strategy’s transactions in shares of the Government STIF Portfolio for the year ended October 31, 2015 is as follows:

Market Value October 31, 2014 (000)		Purchases at Cost (000)		Sales Proceeds (000)		Market Value October 31, 2015 (000)			Dividend Income (000)
$	8,377	$	220,325	$	228,702	$	– 0	–	$	12

NOTE C

Distribution Services Agreement

The Strategy has adopted a Distribution Services Agreement (the “Agreement”) pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the Agreement, the Strategy pays distribution and servicing fees to the Distributor at an annual rate of up to .30% of the Strategy’s average daily net assets attributable to Class A shares, 1% of the Strategy’s average daily net assets attributable to Class C shares and .10% of the Strategy’s average daily net assets attributable to Class 1 shares. There are no distribution and servicing fees on the Advisor Class and Class 2 shares. Effective January 30, 2015, payments under the Agreement in respect of Class A shares are limited to an annual rate of .25% of Class A shares’ average daily net assets. The fees are accrued daily and paid monthly. The Agreement provides that the Distributor will use such payments in their entirety for distribution assistance and promotional activities. Since the commencement of the Strategy’s operations, the Distributor has incurred expenses in excess of the distribution costs reimbursed by the Strategy in the amount of $314,332 and $2,043,431 for Class C and Class 1 shares, respectively. While such costs

36 •  AB MUNICIPAL BOND INFLATION STRATEGY

Notes to Financial Statements

may be recovered from the Strategy in future periods so long as the Agreement is in effect, the rate of the distribution and servicing fees payable under the Agreement may not be increased without a shareholder vote. In accordance with the Agreement, there is no provision for recovery of unreimbursed distribution costs incurred by the Distributor beyond the current fiscal year for Class A shares. The Agreement also provides that the Adviser may use its own resources to finance the distribution of the Strategy’s shares.

NOTE D

Investment Transactions

Purchases and sales of investment securities (excluding short-term investments) for the year ended October 31, 2015 were as follows:

	Purchases		Sales
Investment securities (excluding U.S. government securities)	$	143,300,013	$	169,646,994
U.S. government securities		6,190,547		5,491,027

The cost of investments for federal income tax purposes, gross unrealized appreciation and unrealized depreciation (excluding swap transactions) are as follows:

Cost	$	806,645,550
Gross unrealized appreciation	$	27,564,452
Gross unrealized depreciation		(825,419	)
Net unrealized appreciation	$	26,739,033

1. Derivative Financial Instruments

The Strategy may use derivatives in an effort to earn income and enhance returns, to replace more traditional direct investments, to obtain exposure to otherwise inaccessible markets (collectively, “investment purposes”), or to hedge or adjust the risk profile of its portfolio.

The principal type of derivative utilized by the Strategy, as well as the methods in which they may be used are:

• Swaps

The Strategy may enter into swaps to hedge its exposure to interest rates or credit risk. A swap is an agreement that obligates two parties to exchange a series of cash flows at specified intervals based upon or calculated by reference to changes in specified prices or rates for a specified amount of an underlying asset. The payment flows are usually netted against each other, with the difference being paid by one party to the other. In addition, collateral may be pledged or received by the Strategy in accordance with the terms of the respective swaps to provide value and recourse to the Strategy or its counterparties in the event of default, bankruptcy or insolvency by one of the parties to the swap.

AB MUNICIPAL BOND INFLATION STRATEGY  • 37

Notes to Financial Statements

Risks may arise as a result of the failure of the counterparty to the swap to comply with the terms of the swap. The loss incurred by the failure of a counterparty is generally limited to the net interim payment to be received by the Strategy, and/or the termination value at the end of the contract. Therefore, the Strategy considers the creditworthiness of each counterparty to a swap in evaluating potential counterparty risk. This risk is mitigated by having a netting arrangement between the Strategy and the counterparty and by the posting of collateral by the counterparty to the Strategy to cover the Strategy’s exposure to the counterparty. Additionally, risks may arise from unanticipated movements in interest rates or in the value of the underlying securities. The Strategy accrues for the interim payments on swaps on a daily basis, with the net amount recorded within unrealized appreciation/depreciation of swaps on the statement of assets and liabilities, where applicable. Once the interim payments are settled in cash, the net amount is recorded as realized gain/(loss) on swaps on the statement of operations, in addition to any realized gain/(loss) recorded upon the termination of swaps. Upfront premiums paid or received are recognized as cost or proceeds on the statement of assets and liabilities and are amortized on a straight line basis over the life of the contract. Amortized upfront premiums are included in net realized gain/(loss) from swaps on the statement of operations. Fluctuations in the value of swaps are recorded as a component of net change in unrealized appreciation/depreciation of swaps on the statement of operations.

Inflation (CPI) Swaps:

Inflation swaps are contracts in which one party agrees to pay the cumulative percentage increase in a price index (the Consumer Price Index with respect to CPI swaps) over the term of the swap (with some lag on the inflation index), and the other pays a compounded fixed rate. Inflation swaps may be used to protect the net asset value, or NAV, of the Strategy against an unexpected change in the rate of inflation measured by an inflation index since the value of these agreements is expected to increase if unexpected inflation increases.

During the year ended October 31, 2015, the Strategy held inflation (CPI) swaps for hedging purposes.

Interest Rate Swaps:

The Strategy is subject to interest rate risk exposure in the normal course of pursuing its investment objectives. Because the Strategy holds fixed rate bonds, the value of these bonds may decrease if interest rates rise. To help hedge against this risk and to maintain its ability to generate income at prevailing market rates, the Strategy may enter into interest rate swaps. Interest rate swaps are agreements between two parties to exchange cash flows based on a notional amount. The Strategy may elect to pay a fixed rate and receive a floating rate, or, receive a fixed rate and pay a floating rate on a notional amount.

38 •  AB MUNICIPAL BOND INFLATION STRATEGY

Notes to Financial Statements

In addition, the Strategy may also enter into interest rate swap transactions to preserve a return or spread on a particular investment or portion of its portfolio, or protecting against an increase in the price of securities the Strategy anticipates purchasing at a later date. Interest rate swaps involve the exchange by a Strategy with another party of their respective commitments to pay or receive interest (e.g., an exchange of floating rate payments for fixed rate payments) computed based on a contractually-based principal (or “notional”) amount. Interest rate swaps are entered into on a net basis (i.e., the two payment streams are netted out, with the Strategy receiving or paying, as the case may be, only the net amount of the two payments).

During the year ended October 31, 2015, the Strategy held interest rate swaps for hedging purposes.

The Strategy typically enters into International Swaps and Derivatives Association, Inc. Master Agreements (“ISDA Master Agreement”) or similar master agreements (collectively, “Master Agreements”) with its derivative contract counterparties in order to, among other things, reduce its credit risk to counterparties. ISDA Master Agreements include provisions for general obligations, representations, collateral and events of default or termination. Under an ISDA Master Agreement, the Strategy typically may offset with the counterparty certain derivative financial instrument’s payables and/or receivables with collateral held and/or posted and create one single net payment (close-out netting) in the event of default or termination.

Various Master Agreements govern the terms of certain transactions with counterparties, including transactions such as, derivative transactions, repurchase and reverse repurchase agreements. These Master Agreements typically attempt to reduce the counterparty risk associated with such transactions by specifying credit protection mechanisms and providing standardization that improves legal certainty. Cross-termination provisions under Master Agreements typically provide that a default in connection with one transaction between the Strategy and a counterparty gives the non-defaulting party the right to terminate any other transactions in place with the defaulting party to create one single net payment due to/due from the defaulting party. In the event of a default by a Master Agreements counterparty, the return of collateral with market value in excess of the Strategy’s net liability, held by the defaulting party, may be delayed or denied.

The Strategy’s Master Agreements may contain provisions for early termination of OTC derivative transactions in the event the net assets of the Strategy decline below specific levels (“net asset contingent features”). If these levels are triggered, the Strategy’s counterparty has the right to terminate such transaction

AB MUNICIPAL BOND INFLATION STRATEGY  • 39

Notes to Financial Statements

and require the Strategy to pay or receive a settlement amount in connection with the terminated transaction. For additional details, please refer to netting arrangements by counterparty tables below.

At October 31, 2015, the Strategy had entered into the following derivatives:

	Asset Derivatives			Liability Derivatives
Derivative Type	Statement of Assets and Liabilities Location	Fair Value		Statement of Assets and Liabilities Location	Fair Value
Interest rate contracts	Unrealized appreciation on interest rate swaps	$	88,268	Unrealized depreciation on interest rate swaps	$	1,689
Interest rate contracts				Unrealized depreciation on inflation swaps		56,776,259
Total		$	88,268		$	56,777,948

The effect of derivative instruments on the statement of operations for the year ended October 31, 2015:

Derivative Type	Location of Gain or (Loss) on Derivatives	Realized Gain or (Loss) on Derivatives			Change in Unrealized Appreciation or (Depreciation)
Interest rate contracts	Net realized gain (loss) on swaps; Net change in unrealized appreciation/depreciation of swaps	$	(1,360,153	)	$	(30,732,129	)
Total		$	(1,360,153	)	$	(30,732,129	)

The following table represents the average monthly volume of the Strategy’s derivative transactions during the year ended October 31, 2015:

Interest Rate Swaps:
Average notional amount	$	24,988,889	(a)
Inflation Swaps:
Average notional amount	$	575,415,385

^(a) Positions were open for less than one month during the year.

For financial reporting purposes, the Strategy does not offset derivative assets and derivative liabilities that are subject to netting arrangements in the statement of assets and liabilities.

40 •  AB MUNICIPAL BOND INFLATION STRATEGY

Notes to Financial Statements

All derivatives held at period end were subject to netting arrangements. The following table presents the Strategy’s derivative assets and liabilities by counterparty net of amounts available for offset under Master Agreements (“MA”) and net of the related collateral received/ pledged by the Strategy as of October 31, 2015:

Counterparty	Derivative Assets Subject to a MA		Derivative Available for Offset			Cash Collateral Received			Security Collateral Received			Net Amount of Derivatives Assets
OTC Derivatives:
JPMorgan Chase Bank, NA	$	88,268	$	(88,268	)	$	– 0	–	$	– 0	–	$	– 0	–
Total	$	88,268	$	(88,268	)	$	– 0	–	$	– 0	–	$	– 0	–
Counterparty	Derivative Liabilities Subject to a MA		Derivative Available for Offset			Cash Collateral Pledged			Security Collateral Pledged*			Net Amount of Derivatives Liabilities
OTC Derivatives:
Bank of America, NA	$	142,240	$	– 0	–	$	– 0	–	$	(107,600	)	$	34,640
Barclays Bank PLC		15,490,776		– 0	–		– 0	–		(15,490,776	)		– 0	–
Citibank, NA		18,943,826		– 0	–		– 0	–		(18,943,826	)		– 0	–
Deutsche Bank AG		2,761,218		– 0	–		– 0	–		(2,761,218	)		– 0	–
JPMorgan Chase Bank, NA		11,124,845		(88,268	)		– 0	–		(11,036,577	)		– 0	–
Morgan Stanley Capital Services LLC		8,315,043		– 0	–		– 0	–		(8,197,984	)		117,059
Total	$	56,777,948	$	(88,268	)	$	– 0	–	$	(56,537,981	)	$	151,699	^

* The actual collateral received/pledged may be more than the amount reported due to overcollateralization.

^ Net amount represents the net receivable/payable that would be due from/to the counterparty in the event of default or termination. The net amount from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same counterparty.

AB MUNICIPAL BOND INFLATION STRATEGY  • 41

Notes to Financial Statements

NOTE E

Capital Stock

Each class consists of 3,000,000,000 authorized shares. Transactions in capital shares for Class A, Class C, Advisor Class, Class 1 and Class 2 were as follows:

	Shares						Amount
	Year Ended October 31, 2015			Year Ended October 31, 2014			Year Ended October 31, 2015			Year Ended October 31, 2014
Class A
Shares sold		574,262			1,381,976		$	5,854,217		$	14,378,468
Shares issued in reinvestment of dividends and distributions		50,831			64,886			519,144			676,433
Shares redeemed		(2,298,134	)		(4,945,588	)		(23,438,197	)		(51,592,286	)
Net decrease		(1,673,041	)		(3,498,726	)	$	(17,064,836	)	$	(36,537,385	)
Class C
Shares sold		72,666			186,022		$	748,781		$	1,936,753
Shares issued in reinvestment of dividends and distributions		9,189			8,462			93,690			88,112
Shares redeemed		(778,319	)		(1,079,313	)		(7,932,614	)		(11,205,231	)
Net decrease		(696,464	)		(884,829	)	$	(7,090,143	)	$	(9,180,366	)
Advisor Class
Shares sold		5,702,013			8,998,760		$	58,371,560		$	93,830,198
Shares issued in reinvestment of dividends and distributions		206,101			153,682			2,103,606			1,604,984
Shares redeemed		(6,633,298	)		(8,845,646	)		(67,756,331	)		(91,557,536	)
Net increase (decrease)		(725,184	)		306,796		$	(7,281,165	)	$	3,877,646
Class 1
Shares sold		6,726,352			11,373,052		$	68,580,370		$	118,277,228
Shares issued in reinvestment of dividends and distributions		508,639			447,445			5,176,475			4,657,848
Shares redeemed		(8,073,275	)		(13,388,007	)		(82,131,654	)		(139,824,360	)
Net decrease		(838,284	)		(1,567,510	)	$	(8,374,809	)	$	(16,889,284	)
Class 2
Shares sold		3,789,659			3,899,558		$	38,748,186		$	40,622,722
Shares issued in reinvestment of dividends and distributions		221,546			173,015			2,255,832			1,801,773
Shares redeemed		(4,381,725	)		(4,031,011	)		(44,643,197	)		(41,768,125	)
Net increase (decrease)		(370,520	)		41,562		$	(3,639,179	)	$	656,370

42 •  AB MUNICIPAL BOND INFLATION STRATEGY

Notes to Financial Statements

NOTE F

Risks Involved in Investing in the Strategy

Credit Risk—An issuer or guarantor of a fixed-income security, or the counterparty to a derivatives or other contract, may be unable or unwilling to make timely payments of interest or principal, or to otherwise honor its obligations. The issuer or guarantor may default, causing a loss of the full principal amount of a security. The degree of risk for a particular security may be reflected in its credit rating. There is the possibility that the credit rating of a fixed-income security may be downgraded after purchase, which may adversely affect the value of the security. Investments in fixed-income securities with lower ratings (commonly known as “junk bonds”) are subject to a higher probability that an issuer will default or fail to meet its payment obligations.

Municipal Market Risk—This is the risk that special factors may adversely affect the value of municipal securities and have a significant effect on the yield or value of the Strategy’s investments in municipal securities. These factors include economic conditions, political or legislative changes, uncertainties related to the tax status of municipal securities, or the rights of investors in these securities. To the extent that the Strategy invests more of its assets in a particular state’s municipal securities, the Strategy may be vulnerable to events adversely affecting that state, including economic, political and regulatory occurrences, court decisions, terrorism and catastrophic natural disasters, such as hurricanes or earthquakes. The Strategy’s investments in certain municipal securities with principal and interest payments that are made from the revenues of a specific project or facility, and not general tax revenues, may have increased risks. Factors affecting the project or facility, such as local business or economic conditions, could have a significant effect on the project’s ability to make payments of principal and interest on these securities.

Interest Rate Risk—Changes in interest rates will affect the value of investments in fixed-income securities. When interest rates rise, the value of investments in fixed-income securities tends to fall and this decrease in value may not be offset by higher income from new investments. The Portfolio may be subject to a heightened risk of rising interest rates as the current period of historically low rates is expected to end, and rates are expected to begin rising in the near future. Interest rate risk is generally greater for fixed-income securities with longer maturities or durations.

Duration Risk—Duration is the measure that relates the expected price volatility of a fixed-income security to changes in interest rates. The duration of a fixed-income security may be shorter than or equal to full maturity of a fixed-income security. Fixed-income securities with longer durations have more risk and will decrease in price as interest rates rise. For example, a fixed-income security with a duration of three years will decrease in value by approximately 3% if interest rates increase by 1%.

AB MUNICIPAL BOND INFLATION STRATEGY  • 43

Notes to Financial Statements

Inflation Risk—This is the risk that the value of assets or income from investments will be less in the future as inflation decreases the value of money. As inflation increases, the value of the Strategy’s assets can decline as can the value of the Strategy’s distributions. This risk is significantly greater for fixed-income securities with longer maturities.

Derivatives Risk—The Strategy may enter into derivative transactions such as forwards, options, futures and swaps. Derivatives may be illiquid, difficult to price, and leveraged so that small changes may produce disproportionate losses for the Strategy, and subject to counterparty risk to a greater degree than more traditional investments. Derivatives may result in significant losses, including losses that are far greater than the value of the derivatives reflected in the statement of assets and liabilities.

Leverage Risk—When the Fund borrows money or otherwise leverages its investments, its performance may be volatile because leverage tends to exaggerate the effect of any increase or decrease in the value of the Fund’s investments. The Fund may create leverage through the use of reverse repurchase arrangements, forward currency exchange contracts, forward commitments, dollar rolls or futures or by borrowing money. The use of derivative instruments by the Fund, such as forwards, futures, options and swaps, may also result in a form of leverage. Leverage may result in higher returns to the Fund than if the Fund were not leveraged, but may also adversely affect returns, particularly if the market is declining.

Liquidity Risk—Liquidity risk occurs when certain investments become difficult to purchase or sell. Difficulty in selling less liquid securities may result in sales at disadvantageous prices affecting the value of your investment in the Strategy. Causes of liquidity risk may include low trading volumes, large positions and heavy redemptions of fixed-income mutual fund shares. Over recent years, liquidity risk has also increased because the capacity of dealers in the secondary market for fixed-income securities to make markets in these securities has decreased, even as the overall bond market has grown significantly, due to, among other things, structural changes, additional regulatory requirements and capital and risk restraints that have led to reduced inventories. Liquidity risk may be higher in a rising interest rate environment, when the value and liquidity of fixed-income securities generally go down.

Indemnification Risk—In the ordinary course of business, the Strategy enters into contracts that contain a variety of indemnifications. The Strategy’s maximum exposure under these arrangements is unknown. However, the Strategy has not had prior claims or losses pursuant to these indemnification provisions and expects the risk of loss thereunder to be remote. Therefore, the Strategy has not accrued any liability in connection with these indemnification provisions.

44 •  AB MUNICIPAL BOND INFLATION STRATEGY

Notes to Financial Statements

NOTE G

Joint Credit Facility

A number of open-end mutual funds managed by the Adviser, including the Strategy, participate in a $280 million revolving credit facility (the “Facility”) intended to provide short-term financing, if necessary, subject to certain restrictions in connection with abnormal redemption activity. Commitment fees related to the Facility are paid by the participating funds and are included in miscellaneous expenses in the statement of operations. The Strategy did not utilize the Facility during the year ended October 31, 2015.

NOTE H

Distributions to Shareholders

The tax character of distributions paid during the fiscal years ended October 31, 2015 and 2014 were as follows:

	2015			2014
Distributions paid from:
Ordinary income	$	456,565		$	483,823
Long-term capital gains		– 0	–		22,282
Total taxable distributions		456,565			506,105
Tax-exempt distributions		13,443,276			12,001,626
Total distributions paid	$	13,899,841		$	12,507,731

As of October 31, 2015, the components of accumulated earnings/(deficit) on a tax basis were as follows:

Undistributed tax-exempt income	$	1,087,919
Accumulated capital and other losses		(4,638,889	)(a)
Unrealized appreciation/(depreciation)		(29,946,888	)(b)
Total accumulated earnings/(deficit)	$	(33,497,858	)

^(a)  As of October 31, 2015, the Strategy had a net capital loss carryforward of $4,638,889.

^(b)  The difference between book-basis and tax-basis unrealized appreciation/(depreciation) is attributable primarily to the tax treatment of swaps.

For tax purposes, net capital losses may be carried over to offset future capital gains, if any. Funds are permitted to carry forward capital losses incurred in taxable years beginning after December 22, 2010 for an indefinite period, and such losses will retain their character as either short-term or long-term capital losses. As of October 31, 2015, the Strategy had a net short-term capital loss carryforward of $468,265 and a net long-term capital loss carryforward of $4,170,624 which may be carried forward for an indefinite period.

During the current fiscal year, permanent differences primarily due to nondeductible offering costs resulted in a net increase in undistributed net investment income and a corresponding net decrease to additional paid-in capital. This reclassification had no effect on net assets.

AB MUNICIPAL BOND INFLATION STRATEGY  • 45

Notes to Financial Statements

NOTE I

New Accounting Pronouncement

In May 2015, the Financial Accounting Standards Board issued an Accounting Standards Update (“ASU”), ASU 2015-07, which removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the net asset value per share practical expedient. The ASU also removes the disclosure requirement for investments not valued at net asset value. The ASU is effective for annual periods beginning after December 15, 2015 and interim periods within those annual periods. At this time, management is evaluating the implications of these changes on the financial statements.

NOTE J

Subsequent Events

Management has evaluated subsequent events for possible recognition or disclosure in the financial statements through the date the financial statements are issued. Management has determined that there are no material events that would require disclosure in the Strategy’s financial statements through this date.

46 •  AB MUNICIPAL BOND INFLATION STRATEGY

Notes to Financial Statements

FINANCIAL HIGHLIGHTS

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class A
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.48			$  10.35			$  10.80			$  10.32			$  10.09
Income From Investment Operations
Net investment income(a)(b)		.15			.13			.12			.14			.16
Net realized and unrealized gain (loss) on investment transactions		(.34	)		.12			(.44	)		.50			.26
Net increase (decrease) in net asset value from operations		(.19	)		.25			(.32	)		.64			.42
Less: Dividends and Distributions
Dividends from net investment income		(.15	)		(.12	)		(.11	)		(.14	)		(.17	)
Distributions from net realized gain on investment transactions		– 0	–		(.00	)(c)		(.02	)		(.02	)		(.02	)
Total dividends and distributions		(.15	)		(.12	)		(.13	)		(.16	)		(.19	)
Net asset value, end of period		$  10.14			$  10.48			$  10.35			$  10.80			$  10.32
Total Return
Total investment return based on net asset value(d)		(1.83	)%		2.44	%		(2.98	)%		6.22	%		4.24	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$41,122			$60,016			$95,466			$79,735			$64,342
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.76	%		.80	%		.80	%		.80	%		.80	%
Expenses, before waivers/reimbursements		.87	%		.90	%		.91	%		.95	%		1.20	%
Net investment income(a)		1.49	%		1.24	%		1.10	%		1.34	%		1.57	%
Portfolio turnover rate		17	%		18	%		15	%		10	%		26	%

See footnote summary on page 51.

AB MUNICIPAL BOND INFLATION STRATEGY  • 47

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class C
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.46			$  10.33			$  10.78			$  10.30			$  10.08
Income From Investment Operations
Net investment income(a)(b)		.08			.06			.04			.07			.09
Net realized and unrealized gain (loss) on investment transactions		(.35	)		.12			(.43	)		.50			.25
Net increase (decrease) in net asset value from operations		(.27	)		.18			(.39	)		.57			.34
Less: Dividends and Distributions
Dividends from net investment income		(.07	)		(.05	)		(.04	)		(.07	)		(.10	)
Distributions from net realized gain on investment transactions		– 0	–		(.00	)(c)		(.02	)		(.02	)		(.02	)
Total dividends and distributions		(.07	)		(.05	)		(.06	)		(.09	)		(.12	)
Net asset value, end of period		$  10.12			$  10.46			$  10.33			$  10.78			$  10.30
Total Return
Total investment return based on net asset value(d)		(2.56	)%		1.72	%		(3.67	)%		5.51	%		3.45	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$13,154			$20,873			$29,748			$35,436			$23,919
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		1.50	%		1.50	%		1.50	%		1.50	%		1.50	%
Expenses, before waivers/reimbursements		1.61	%		1.60	%		1.61	%		1.65	%		1.91	%
Net investment income(a)		.75	%		.54	%		.41	%		.64	%		.87	%
Portfolio turnover rate		17	%		18	%		15	%		10	%		26	%

See footnote summary on page 51.

48 •  AB MUNICIPAL BOND INFLATION STRATEGY

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Advisor Class
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.48			$  10.35			$  10.81			$  10.32			$  10.10
Income From Investment Operations
Net investment income(a)(b)		.18			.16			.15			.17			.19
Net realized and unrealized gain (loss) on investment transactions		(.34	)		.12			(.45	)		.51			.25
Net increase (decrease) in net asset value from operations		(.16	)		.28			(.30	)		.68			.44
Less: Dividends and Distributions
Dividends from net investment income		(.18	)		(.15	)		(.14	)		(.17	)		(.20	)
Distributions from net realized gain on investment transactions		– 0	–		(.00	)(c)		(.02	)		(.02	)		(.02	)
Total dividends and distributions		(.18	)		(.15	)		(.16	)		(.19	)		(.22	)
Net asset value, end of period		$  10.14			$  10.48			$  10.35			$  10.81			$  10.32
Total Return
Total investment return based on net asset value(d)		(1.56	)%		2.75	%		(2.78	)%		6.64	%		4.44	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$171,789			$185,106			$179,620			$85,781			$41,924
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.50	%		.50	%		.50	%		.50	%		.50	%
Expenses, before waivers/reimbursements		.61	%		.60	%		.61	%		.65	%		.88	%
Net investment income(a)		1.76	%		1.55	%		1.39	%		1.63	%		1.85	%
Portfolio turnover rate		17	%		18	%		15	%		10	%		26	%

See footnote summary on page 51.

AB MUNICIPAL BOND INFLATION STRATEGY  • 49

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class 1
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.45			$  10.33			$  10.78			$  10.30			$  10.08
Income From Investment Operations
Net investment income(a)(b)		.17			.15			.14			.16			.17
Net realized and unrealized gain (loss) on investment transactions		(.34	)		.12			(.43	)		.50			.27
Net increase (decrease) in net asset value from operations		(.17	)		.27			(.29	)		.66			.44
Less: Dividends
Dividends from net investment income		(.17	)		(.15	)		(.14	)		(.16	)		(.20	)
Distributions from net realized gain on investment transactions		– 0	–		(.00	)(c)		(.02	)		(.02	)		(.02	)
Total dividends and distributions		(.17	)		(.15	)		(.16	)		(.18	)		(.22	)
Net asset value, end of period		$  10.11			$  10.45			$  10.33			$  10.78			$  10.30
Total Return
Total investment return based on net asset value(d)		(1.62	)%		2.60	%		(2.76	)%		6.45	%		4.40	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$386,448			$408,307			$419,573			$236,285			$111,857
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.60	%		.60	%		.60	%		.60	%		.60	%
Expenses, before waivers/reimbursements		.67	%		.66	%		.67	%		.74	%		.92	%
Net investment income(a)		1.66	%		1.44	%		1.30	%		1.54	%		1.66	%
Portfolio turnover rate		17	%		18	%		15	%		10	%		26	%

See footnote summary on page 51.

50 •  AB MUNICIPAL BOND INFLATION STRATEGY

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class 2
	Year Ended October 31,
	2015			2014			2013			2012			2011
Net asset value, beginning of period		$  10.46			$  10.33			$  10.79			$  10.31			$  10.08
Income From Investment Operations
Net investment income(a)(b)		.18			.16			.15			.17			.17
Net realized and unrealized gain (loss) on investment transactions		(.34	)		.13			(.44	)		.50			.28
Net increase (decrease) in net asset value from operations		(.16	)		.29			(.29	)		.67			.45
Less: Dividends and Distributions
Dividends from net investment income		(.18	)		(.16	)		(.15	)		(.17	)		(.20	)
Distributions from net realized gain on investment transactions		– 0	–		(.00	)(c)		(.02	)		(.02	)		(.02	)
Total dividends and distributions		(.18	)		(.16	)		(.17	)		(.19	)		(.22	)
Net asset value, end of period		$  10.12			$  10.46			$  10.33			$  10.79			$  10.31
Total Return
Total investment return based on net asset value(d)		(1.52	)%		2.79	%		(2.75	)%		6.54	%		4.54	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$176,066			$185,904			$183,237			$92,507			$43,368
Ratio to average net assets of:
Expenses, net of waivers		.50	%		.50	%		.50	%		.50	%		.50	%
Expenses, before waivers		.57	%		.56	%		.57	%		.64	%		.85	%
Net investment income(a)		1.76	%		1.54	%		1.39	%		1.64	%		1.77	%
Portfolio turnover rate.		17	%		18	%		15	%		10	%		26	%

(a) Net of fees waived and expenses reimbursed by the Adviser.

(b) Based on average shares outstanding.

(c) Amount is less than $.005.

(d) Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Initial sales charges or contingent deferred sales charges are not reflected in the calculation of total investment return. Total return does not reflect the deduction of taxes that a shareholder would pay on portfolio distributions or the redemption of portfolio shares. Total investment return calculated for a period of less than one year is not annualized.

See notes to financial statements.

AB MUNICIPAL BOND INFLATION STRATEGY  • 51

Financial Highlights

REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of AB Municipal Bond Inflation Strategy Portfolio

We have audited the accompanying statement of assets and liabilities, including the portfolio of investments, of AB Municipal Bond Inflation Strategy Portfolio (the “Fund”) (formerly AllianceBernstein Municipal Bond Inflation Strategy Portfolio), one of the portfolios constituting AB Bond Fund, Inc. (formerly AllianceBernstein Bond Fund, Inc.), as of October 31, 2015, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Fund’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of October 31, 2015, by correspondence with the custodian and others, or by other appropriate auditing procedures where replies from others were not received. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the AB Municipal Bond Inflation Strategy Portfolio, one of the portfolios constituting AB Bond Fund, Inc., at October 31, 2015, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended and the financial highlights for each of five years in the period then ended, in conformity with U.S. generally accepted accounting principles.

New York, New York

December 30, 2015

52 •  AB MUNICIPAL BOND INFLATION STRATEGY

Report of Independent Registered Public Accounting Firm

BOARD OF DIRECTORS

Marshall C. Turner, Jr.⁽¹⁾, Chairman John H. Dobkin⁽¹⁾ Michael J. Downey⁽¹⁾ William H. Foulk, Jr.⁽¹⁾ D. James Guzy⁽¹⁾ Nancy P. Jacklin⁽¹⁾ Robert M. Keith, President and Chief Executive Officer Garry L. Moody⁽¹⁾ Earl D. Weiner⁽¹⁾

OFFICERS

Philip L. Kirstein,
Senior Vice President and Independent Compliance Officer Michael G. Brooks⁽²⁾, Vice President Robert (“Guy”) B. Davidson III⁽²⁾ , Vice President Wayne D. Godlin⁽²⁾, Vice President Terrance T. Hults⁽²⁾, Vice President Emilie D. Wrapp, Secretary Joseph J. Mantineo, Treasurer and Chief Financial Officer Phyllis J. Clarke, Controller Vincent S. Noto, Chief Compliance Officer

Custodian and Accounting Agent State Street Bank and Trust Company State Street Corporation CCB/5 1 Iron Street Boston, MA 02210   Principal Underwriter AllianceBernstein Investments, Inc. 1345 Avenue of the Americas New York, NY 10105   Transfer Agent AllianceBernstein Investor Services, Inc. P.O. Box 786003 San Antonio, TX 78278-6003 Toll-Free (800) 221-5672 Independent Registered Public
Accounting Firm Ernst & Young LLP 5 Times Square New York, NY 10036   Legal Counsel Seward & Kissel LLP One Battery Park Plaza New York, NY 10004

(1) Member of the Audit Committee, the Governance and Nominating Committee and the Independent Directors Committee.

(2) The day-to-day management of, and investment decisions for, the Strategy’s portfolio are made by the Adviser’s Municipal Bond Investment Team. Messrs. Michael G. Brooks, Robert “Guy” B. Davidson III, Wayne D. Godlin and Terrance T. Hults are the investment professionals with the most significant responsibility for the day-to-day management of the Strategy’s portfolio.

AB MUNICIPAL BOND INFLATION STRATEGY  • 53

Board of Directors

MANAGEMENT OF THE FUND

Board of Directors Information

The business and affairs of the Strategy are managed under the direction of the Board of Directors. Certain information concerning the Strategy’s Directors is set forth below.

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
INTERESTED DIRECTOR
Robert M. Keith, + 1345 Avenue of the Americas New York, NY 10105 55 (2010)	Senior Vice President of AllianceBernstein L.P. (the “Adviser”) and the head of AllianceBernstein Investments, Inc. (“ABI”) since July 2008; Director of ABI and President of the AB Mutual Funds. Previously, he served as Executive Managing Director of ABI from December 2006 to June 2008. Prior to joining ABI in 2006, Executive Managing Director of Bernstein Global Wealth Management, and prior thereto, Senior Managing Director and Global Head of Client Service and Sales of the Adviser’s institutional investment management business since 2004. Prior thereto, he was Managing Director and Head of North American Client Service and Sales in the Adviser’s institutional investment management business, with which he had been associated since prior to 2004.		110	None

54 •  AB MUNICIPAL BOND INFLATION STRATEGY

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS
Marshall C. Turner, Jr., ++ Chairman of the Board 74 (2005)	Private Investor since prior to 2010. Former Chairman CEO of Dupont Photomasks, Inc. (components of semi-conductor manufacturing). He has extensive operating leadership and venture capital investment experience, including five interim or full-time CEO roles and prior service as general partner of institutional venture capital partnerships. He also has extensive non-profit board leadership experience, and currently serves on the boards of two education and science-related non-profit organizations. He has served as a director of one AB fund since 1992, and director or trustee of multiple AB Funds since 2005. He has been Chairman of the AB Funds since January 2014, and the Chairman of the Independent Directors Committees of such Funds since February 2014.		110	Xilinx, Inc. (programmable logic semi-conductors) since 2007
John H. Dobkin, ++ 73 (1998)	Independent Consultant since prior to 2010. Formerly, President of Save Venice, Inc. (preservation organization) from 2001-2002; Senior Advisor from June 1999-June 2000 and President of Historic Hudson Valley (historic preservation) from December 1989-May 1999. Previously, Director of the National Academy of Design. He has served as a director or trustee of various AB Funds since 1992, and as Chairman of the Audit Committees of a number of such Funds from 2001-2008.		110	None

AB MUNICIPAL BOND INFLATION STRATEGY  • 55

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
Michael J. Downey, ++ 71 (2005)	Private Investor since prior to 2010. Formerly, managing partner of Lexington Capital, LLC (investment advisory firm) from December 1997 until December 2003. He served as Director of The Merger Fund (registered investment company) since prior to 2009 until 2013. He served as a Director of Prospect Acquisition Corp. (financial services) from 2007 until 2009. From 1987 until 1993, Chairman and CEO of Prudential Mutual Fund Management, director of the Prudential mutual funds, and member of the Executive Committee of Prudential Securities Inc. He has served as a director or trustee of the AB Funds since 2005 and is a director and Chairman of one other registered investment company.		110	Asia Pacific Fund, Inc. (registered investment company) since prior to 2010
William H. Foulk, Jr., ++ 83 (1998)	Investment Adviser and an Independent Consultant since prior to 2010. Previously, he was Senior Manager of Barrett Associates, Inc., a registered investment adviser. He was formerly Deputy Comptroller and Chief Investment Officer of the State of New York and, prior thereto, Chief Investment Officer of the New York Bank for Savings. He has served as a director or trustee of various AB Funds since 1983, and was Chairman of the Independent Directors Committees of the AB Funds from 2003 until early February 2014. He served as Chairman of such Funds from 2003 through December 2013. He is also active in a number of mutual fund related organizations and committees.		110	None

56 •  AB MUNICIPAL BOND INFLATION STRATEGY

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
D. James Guzy, ++ 79 (2005)	Chairman of the Board of SRC Computers, Inc. (semi-conductors), with which he has been associated since prior to 2010. He served as Chairman of the Board of PLX Technology (semi-conductors) since prior to 2010 until November 2013. He was Director of Cirrus Logic Corporation (semi-conductors) from 1984 until July 2011. He was a director of Intel Corporation (semi-conductors) from 1969 until 2008, and served as Chairman of the Finance Committee of such company for several years until May 2008. He has served as a director or trustee of one or more of the AB Funds since 1982.		110	None
Nancy P. Jacklin, ++ 67 (2006)	Professorial Lecturer at the Johns Hopkins School of Advanced International Studies (2008-2015). U.S. Executive Director of the International Monetary Fund (which is responsible for ensuring the stability of the international monetary system), (December 2002-May 2006); Partner, Clifford Chance (1992-2002); Sector Counsel, International Banking and Finance, and Associate General Counsel, Citicorp (1985-1992); Assistant General Counsel (International), Federal Reserve Board of Governors (1982-1985); and Attorney Advisor, U.S. Department of the Treasury (1973-1982). Member of the Bar of the District of Columbia and of New York; and member of the Council on Foreign Relations. She has served as a director or trustee of the AB Funds since 2006 and has been Chairman of the Governance and Nominating Committees of the Funds since August 2014.		110	None

AB MUNICIPAL BOND INFLATION STRATEGY  • 57

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
Garry L. Moody, ++ 63 (2008)	Independent Consultant. Formerly, Partner, Deloitte & Touche LLP (1995-2008) where he held a number of senior positions, including Vice Chairman, and U.S. and Global Investment Management Practice Managing Partner; President, Fidelity Accounting and Custody Services Company (1993-1995); and Partner, Ernst & Young LLP (1975-1993), where he served as the National Director of Mutual Fund Tax Services and Managing Partner of its Chicago Office Tax department. He is a member of the Trustee Advisory Board of BoardIQ, a biweekly publication focused on issues and news affecting directors of mutual funds. He has served as a director or trustee, and as Chairman of the Audit Committees, of the AB Funds since 2008.		110	None

58 •  AB MUNICIPAL BOND INFLATION STRATEGY

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
Earl D. Weiner, ++ 76 (2007)	Of Counsel, and Partner prior to January 2007, of the law firm Sullivan & Cromwell LLP and is a former member of the ABA Federal Regulation of Securities Committee Task Force to draft editions of the Fund Director’s Guidebook. He also serves as a director or trustee of various non-profit organizations and has served as Chairman or Vice Chairman of a number of them. He has served as a director or trustee of the AB Funds since 2007 and served as Chairman of the Governance and Nominating Committees of the AB Funds from 2007 until August 2014.		110	None

* The address for each of the Strategy’s disinterested Directors is c/o AllianceBernstein L.P., Attention: Philip L. Kirstein, 1345 Avenue of the Americas, New York, NY 10105.

** There is no stated term of office for the Strategy’s Directors.

*** The information above includes each Director’s principal occupation during the last five years and other information relating to the experience, attributes and skills relevant to each Director’s qualifications to serve as a Director, which led to the conclusion that each Director should serve as a Director for the Strategy.

+ Mr. Keith is an “interested person” of the Strategy as defined in the “40 Act,” due to his position as a Senior Vice President of the Adviser.

++ Member of the Audit Committee, the Governance and Nominating Committee and the Independent Directors Committee.

AB MUNICIPAL BOND INFLATION STRATEGY  • 59

Management of the Fund

Officer Information

Certain information concerning the Strategy’s Officers is listed below.

NAME, ADDRESS* AND AGE	PRINCIPAL POSITION(S) HELD WITH FUND	PRINCIPAL OCCUPATION DURING PAST 5 YEARS
Robert M. Keith 55	President and Chief Executive Officer	See biography above.
Philip L. Kirstein 70	Senior Vice President and Independent Compliance Officer	Senior Vice President and Independent Compliance Officer of the AB Funds, with which he has been associated since October 2004. Prior thereto, he was Of Counsel to Kirkpatrick & Lockhart, LLP from October 2003 to October 2004, and General Counsel of Merrill Lynch Investment Managers, L.P. since prior to March 2003.
Michael G. Brooks 67	Vice President	Senior Vice President of the Adviser,** with which he has been associated since prior to 2010.
Robert “Guy” B. Davidson III 54	Vice President	Senior Vice President of the Adviser,** with which he has been associated since prior to 2010.
Wayne D. Godlin 54	Vice President	Senior Vice President of the Adviser,** with which he has been associated since prior to 2010.
Terrance T. Hults 49	Vice President	Senior Vice President of the Adviser,** with which he has been associated since prior to 2010.
Emilie D. Wrapp 59	Secretary	Senior Vice President, Assistant General Counsel and Assistant Secretary of ABI,** with which she has been associated since prior to 2010.
Joseph J. Mantineo 56	Treasurer and Chief Financial Officer	Senior Vice President of AllianceBernstein Investor Services, Inc. (“ABIS”),** with which he has been associated since prior to 2010.
Phyllis J. Clarke 54	Controller	Vice President of ABIS,** with which she has been associated since prior to 2010.
Vincent S. Noto 50	Chief Compliance Officer	Senior Vice President since 2015 and Mutual Fund Chief Compliance Officer of the Adviser** since 2014. Prior thereto, he was Vice President and Director of Mutual Fund Compliance of the Adviser** since 2010.

60 •  AB MUNICIPAL BOND INFLATION STRATEGY

Management of the Fund

* The address for each of the Fund’s Officers is 1345 Avenue of the Americas, New York, NY 10105.

** The Adviser, ABI and ABIS are affiliates of the Strategy.

The Fund’s Statement of Additional Information (“SAI”) has additional information about the Strategy’s Directors and Officers and is available without charge upon request. Contact your financial representative or AllianceBernstein at 1-800-227-4618, or visit www.alliancebernstein.com, for a free prospectus or SAI.

AB MUNICIPAL BOND INFLATION STRATEGY  • 61

Management of the Fund

THE FOLLOWING IS NOT PART OF THE SHAREHOLDER REPORT OR THE FINANCIAL STATEMENTS

SUMMARY OF SENIOR OFFICER’S EVALUATION OF INVESTMENT ADVISORY AGREEMENT¹

The following is a summary of the evaluation of the Investment Advisory Agreement between AllianceBernstein L.P. (the “Adviser”) and AB Bond Fund, Inc. (the “Fund”) in respect of AB Municipal Bond Inflation Strategy (the “Strategy”).² The evaluation of the Investment Advisory Agreement was prepared by Philip L. Kirstein, the Senior Officer of the Fund, for the Directors of the Fund, as required by the September 1, 2004 Assurance of Discontinuance (“AoD”) between the Adviser and the New York State Attorney General (the “NYAG”). The Senior Officer’s evaluation of the Investment Advisory Agreement is not meant to diminish the responsibility or authority of the Board of Directors of the Fund to perform its duties pursuant to Section 15 of the Investment Company Act of 1940 (the “40 Act”) and applicable state law. The purpose of this summary is to provide shareholders with a synopsis of the independent evaluation of the reasonableness of the advisory fees proposed to be paid by the Strategy which was provided to the Directors in connection with their review of the proposed approval of the continuance of the Investment Advisory Agreement. The Senior Officer’s evaluation considered the following factors:

1. Advisory fees charged to institutional and other clients of the Adviser for like services;

2. Advisory fees charged by other mutual fund companies for like services;

3. Costs to the Adviser and its affiliates of supplying services pursuant to the advisory agreement, excluding any intra-corporate profit;

4. Profit margins of the Adviser and its affiliates from supplying such services;

5. Possible economies of scale as the Strategy grows larger; and

6. Nature and quality of the Adviser’s services including the performance of the Strategy.

These factors, with the exception of the first factor, are generally referred to as the “Gartenberg factors,” which were articulated by the United States Court of Appeals for the Second Circuit in 1982. Gartenberg v. Merrill Lynch Asset Management, Inc., 694 F. 2d 923 (2d Cir. 1982). On March 30, 2010, the Supreme Court held the Gartenberg decision was correct in its basic formulation of what Section 36(b) requires: to face liability under Section 36(b), “an investment adviser must charge a fee that is so disproportionately large that it bears no reasonable relationship to the services rendered and could not have been the product of

1 The Senior Officer’s fee evaluation was completed on October 22, 2015 and discussed with the Board of Directors on November 3-5, 2015.

2 Future references to the Fund or the Strategy do not include “AB.”

62 •  AB MUNICIPAL BOND INFLATION STRATEGY

arm’s length bargaining.”Jones v. Harris Associates L.P., 130 S. Ct. 1418 (2010). In Jones, the Court stated the Gartenberg approach fully incorporates the correct understanding of fiduciary duty within the context of Section 36(b) and noted with approval that “Gartenberg insists that all relevant circumstances be taken into account” and “uses the range of fees that might result from arm’s length bargaining as the benchmark for reviewing challenged fees.”³

INVESTMENT ADVISORY FEES, NET ASSETS, EXPENSE CAPS & RATIOS

The Adviser proposed that the Strategy pay the advisory fee set forth in the table below for receiving the services to be provided pursuant to the Investment Advisory Agreement. The fee schedule below, implemented in January 2004 in connection with the Adviser’s settlement with the NYAG in December 2003, is based on a master schedule that contemplates eight categories of funds with almost all funds in each category having the same advisory fee schedule.⁴

Strategy	Category	Advisory Fee Based on % of Average Daily Net Assets	Net Assets 09/30/15 ($MM)
Municipal Bond Inflation Strategy	High Income	0.50% on 1st $2.5 billion 0.45% on next $2.5 billion 0.40% on the balance	$	799.3

The Adviser is reimbursed as specified in the Investment Advisory Agreement for certain clerical, legal, accounting, administrative and other services provided to the Strategy. During the Strategy’s fiscal year ended October 31, 2014, the Adviser received $60,253 (0.007% of the Strategy’s average daily net assets) for such services.

The Adviser agreed to waive that portion of its advisory fees and/or reimburse the Strategy for that portion of the Strategy’s total operating expenses to the degree necessary to limit the Strategy’s expense ratios to the amounts set forth below for the Strategy’s current fiscal year. The waiver is terminable by the Adviser upon at least 60 days’ notice prior to the Strategy’s prospectus update. In addition, set forth below are the Strategy’s gross expense ratios for the most recent semi-annual period:⁵

Strategy	Expense Cap Pursuant to Expense Limitation Undertaking			Gross Expense Ratio6	Fiscal Year End
Municipal Bond Inflation Strategy7	Advisor Class A Class C Class 1 Class 2	0.50 0.75 1.50 0.60 0.50	%  %  %  %  %	0.60% 0.88% 1.60% 0.66% 0.56%	October 31 (ratio as of April 30, 2015)

3 Jones v. Harris at 1427.

4 Most of the AB Mutual Funds, which the Adviser manages, were affected by the Adviser’s settlement with the NYAG.

5 Semi-annual total expense ratios are unaudited.

6 Annualized.

7 Effective January 30, 2015, the Rule 12b-1 fee for Class A shares of the Strategy was reduced from 0.30% to 0.25%. At the same time, the expense cap for the Class A shares was also reduced from 0.80% to 0.75%.

AB MUNICIPAL BOND INFLATION STRATEGY  • 63

I. ADVISORY FEES CHARGED TO INSTITUTIONAL AND OTHER CLIENTS

The advisory fees charged to investment companies which the Adviser manages and sponsors are normally higher than those charged to similar sized institutional accounts, including pension plans and sub-advised investment companies. The fee differential reflects, among other things, different services provided to such clients, and different liabilities assumed. Services provided by the Adviser to the Strategy that are not provided to non-investment company clients include providing office space and personnel to serve as Fund Officers, who among other responsibilities make the certifications required under the Sarbanes-Oxley Act of 2002, and coordinating with and monitoring the Strategy’s third party service providers such as Fund counsel, auditors, custodians, transfer agents and pricing services. The accounting, administrative, legal and compliance requirements for the Strategy are more costly than those for institutional client assets due to the greater complexities and time required for investment companies, although as previously noted, the Adviser is reimbursed for providing such services. Also, retail mutual funds managed by the Adviser are widely held and accordingly, servicing the Strategy’s investors is more time consuming and labor intensive compared to servicing institutional clients since the Adviser needs to communicate with a more extensive network of financial intermediaries and shareholders. The Adviser also believes that it incurs substantial entrepreneurial risk when offering a new mutual fund since establishing a new mutual fund requires a large upfront investment and it may take a long time for the fund to achieve profitability since the fund must be priced to scale from inception in order to be competitive and assets are acquired one account at a time. In addition, managing the cash flow of an investment company may be more difficult than that of a stable pool of assets, such as an institutional account with little cash movement in either direction, particularly if the Strategy is in net redemption and the Adviser is frequently forced to sell securities to raise cash for redemptions. However, managing a fund with positive cash flow may be easier at times than managing a stable pool of assets. Finally, in recent years, investment advisers have been sued by institutional clients and have suffered reputational damage both by the attendant publicity and outcomes other than complete victories. Accordingly, the legal and reputational risks associated with institutional accounts are greater than previously thought, although arguably still not equal to those related to the mutual fund industry.

Notwithstanding the Adviser’s view that managing an investment company is not comparable to managing other institutional accounts because the services provided are different, the Supreme Court has indicated consideration should be given to the advisory fees charged to institutional accounts with a similar investment style as the Strategy.⁸ However, with respect to the Strategy, the

8 The Supreme Court stated that “courts may give such comparisons the weight that they merit in light of the similarities and differences between the services that the clients in question require, but the courts must be wary of inapt comparisons.” Among the significant differences the Supreme Court noted that may exist between services provided to mutual funds and institutional accounts are “higher marketing costs.” Jones v. Harris at 1428.

64 •  AB MUNICIPAL BOND INFLATION STRATEGY

Adviser represented that there is no category in the Form ADV for institutional products that have a substantially similar investment styles as the Strategy.

The Adviser represented that it does not sub-advise any registered investment companies that have a similar investment strategy as the Strategy.

II. MANAGEMENT FEES CHARGED BY OTHER MUTUAL FUND COMPANIES FOR LIKE SERVICES.

Broadridge Financial Solutions, Inc. (“Broadridge”), an analytical service that is not affiliated with the Adviser, compared the fees charged to the Strategy with fees charged to other investment companies for similar services offered by other investment advisers.^9,10 Broadridge’s analysis included the comparison of the Strategy’s contractual management fee, estimated at the approximate current asset level of the Strategy, to the median of the Strategy’s Broadridge Expense Group (“EG”)¹¹ and the Strategy’s contractual management fee ranking.¹²

Broadridge describes an EG as a representative sample of comparable funds. Broadridge’s standard methodology for screening funds to be included in an EG entails the consideration of several fund criteria, including fund type, Lipper investment classification/objective, load type and similar 12b-1/non-12b-1 service fees, asset (size) comparability, expense components and attributes. An EG will typically consist of seven to twenty funds.

Strategy	Contractual Management Fee (%)		Broadridge EG Median (%)		Broadridge EG Rank
Municipal Bond Inflation Strategy		0.500		0.505		5/14

9 The Supreme Court cautioned against accepting mutual fund fee comparisons without careful scrutiny since “these comparisons are problematic because these fees, like those challenged, may not be the product of negotiations conducted at arm’s length.” Jones v. Harris at 1429.

10 On June 5, 2015, Broadridge acquired the Fiduciary Services and Competitive Intelligence unit, i.e., the group responsible for providing the Strategy’s 15(c) reports, from Thomson Reuters’ Lipper division. The group that maintains Lipper’s expense and performance databases and investment classification/objective remains a part of Thomson Reuters’ Lipper division. Accordingly, the Strategy’s investment classification/objective continued to be determined by Lipper.

11 Broadridge does not consider average account size when constructing EGs. Funds with relatively small average account sizes tend to have higher transfer agent expense ratios than comparable sized funds that have relatively large average account sizes. There are limitations to Lipper expense category data because different funds categorize expenses differently.

12 The contractual management fee is calculated by Broadridge using the Strategy’s contractual management fee rate at the hypothetical asset level. The hypothetical asset level is based on the combined net assets of all classes of the Strategy, rounded up to the next $25 million. Broadridge’s total expense ratio information is based on the most recent annual report except as otherwise noted. A ranking of “1” would mean that Strategy had the lowest effective fee rate in the Broadridge peer group.

AB MUNICIPAL BOND INFLATION STRATEGY  • 65

Broadridge also compared the Strategy’s total expense ratio to the medians of the Strategy’s EG and Broadridge Expense Universe (“EU”). The EU is a broader group compared to the EG, consisting of all funds that have the same investment classifications/
objective and load type as the subject Strategy.¹³ Pro-forma total expense ratio (italicized) is shown to reflect the Strategy’s 12b-1 fee reduction had the reduction been in effect during the Portfolio’s entire fiscal year.

Strategy	Total Expense Ratio (%)14		Broadridge EG Median (%)		Broadridge EG Rank	Broadridge EU Median (%)		Broadridge EU Rank
Municipal Bond Inflation Strategy		0.800		0.810	5/14		0.753	28/44
Pro-forma		0.750		0.810	2/14		0.753	22/44

Based on this analysis, considering pro-forma information where available, the Strategy has a more favorable ranking on a total expense ratio basis than on a contractual management fee basis.

III. COSTS TO THE ADVISER AND ITS AFFILIATES OF SUPPLYING SERVICES PURSUANT TO THE ADVISORY FEE ARRANGEMENT, EXCLUDING ANY INTRA-CORPORATE PROFIT.

The Adviser utilizes two profitability reporting systems, which operate independently but are aligned with each other, to estimate the Adviser’s profitability in connection with investment advisory services provided to the Strategy. The Senior Officer has retained an independent consultant to provide independent advice regarding the alignment of the two profitability systems as well as the methodologies and allocations utilized by both profitability systems. See Section IV for additional discussion.

IV. PROFIT MARGINS OF THE ADVISER AND ITS AFFILIATES FOR SUPPLYING SUCH SERVICES.

The profitability information for the Strategy, prepared by the Adviser for the Board of Directors, was reviewed by the Senior Officer and the independent consultant. The Adviser’s profitability from providing investment advisory services to the Strategy increased during calendar year 2014, relative to 2013.

In addition to the Adviser’s direct profits from managing the Strategy, certain of the Adviser’s affiliates have business relationships with the Strategy and may earn a profit from providing other services to the Strategy. The courts have referred to this type of business opportunity as “fall-out benefits” to the Adviser and

13 Except for asset (size) comparability, Broadridge uses the same criteria for selecting an EG when selecting an EU. Unlike the EG, the EU allows for the same adviser to be represented by more than just one fund.

14 Most recently completed fiscal year Class A share total expense ratio.

66 •  AB MUNICIPAL BOND INFLATION STRATEGY

indicated that such benefits should be factored into the evaluation of the total relationship between the Strategy and the Adviser. Neither case law nor common business practice precludes the Adviser’s affiliates from earning a reasonable profit on this type of relationship provided the affiliates’ charges and services are competitive. These affiliates provide transfer agent and distribution related services to the Strategy and receive transfer agent fees, front-end sales loads, Rule 12b-1 payments and contingent deferred sales charges (“CDSC”). During the Strategy’s fiscal year ended October 31, 2014, ABI received from the Strategy $926,617 and $39,273 in Rule 12b-1 and CDSC fees, respectively.

AllianceBernstein Investments, Inc. (“ABI”), an affiliate of the Adviser, is the Strategy’s principal underwriter. ABI and the Adviser have disclosed in the Strategy’s prospectus that they may make revenue sharing payments from their own resources, in addition to revenues derived from sales loads and Rule 12b-1 fees, to firms that sell shares of the Strategy. In 2014, ABI paid approximately 0.05% of the average monthly assets of the AB Mutual Funds or approximately $20.4 million for distribution services and educational support (revenue sharing payments).

Fees and reimbursements for out of pocket expenses charged by AllianceBernstein Investor Services, Inc. (“ABIS”), the affiliated transfer agent for the Strategy, are charged on a per account basis, based on the level of service provided and the class of share held by the account. ABIS also receives a fee per shareholder sub-account for each account maintained by an intermediary on an omnibus basis. During the Strategy’s fiscal year ended October 31, 2014, ABIS received $46,498 in fees from the Strategy.

V. POSSIBLE ECONOMIES OF SCALE

The Adviser has indicated that economies of scale are being shared with shareholders through pricing to scale, breakpoints, fee reductions/waivers and enhancement to services.

In May 2012, an independent consultant, retained by the Senior Officer, provided the Board of Directors information on the Adviser’s firm-wide average costs from 2005 through 2011 and the potential economies of scale. The independent consultant noted that from 2005 through 2007 the Adviser experienced significant growth in assets under management (“AUM”). During this period, operating expenses increased, in part to keep up with growth, and in part reflecting market returns. However, from 2008 through the first quarter of 2009, AUM rapidly and significantly decreased due to declines in market value and client withdrawals. When AUM rapidly decreased, some operating expenses categories, including base compensation and office space, adjusted more slowly during this period, resulting in an increase in average costs. Since 2009, AUM has experienced less significant changes. The independent consultant noted that changes in operating expenses reflect changes in business composition and business practices in response to

AB MUNICIPAL BOND INFLATION STRATEGY  • 67

changes in financial markets. Finally, the independent consultant concluded that the increase in average cost and the decline in net operating margin across the Adviser since late 2008 are inconsistent with the view that there are currently reductions in average costs due to economies of scale that can be shared with the AB Mutual Funds managed by the Adviser through lower fees.

Previously, in February 2008, the independent consultant provided the Board of Directors an update of the Deli¹⁵ study on advisory fees and various fund characteristics.¹⁶ The independent consultant first reiterated the results of his previous two dimensional comparison analysis (fund size and family size) with the Board of Directors.¹⁷ The independent consultant then discussed the results of the regression model that was utilized to study the effects of various factors on advisory fees. The regression model output indicated that the bulk of the variation in fees predicted were explained by various factors, but substantially by fund AUM, family AUM, index fund indicator and investment style. The independent consultant also compared the advisory fees of the AB Mutual Funds to similar funds managed by 19 other large asset managers, regardless of the fund size and each Adviser’s proportion of mutual fund assets to non-mutual fund assets.

VI. NATURE AND QUALITY OF THE ADVISER’S SERVICES INCLUDING THE PERFORMANCE OF THE PORTFOLIO.

With assets under management of approximately $463 billion as of September 30, 2015, the Adviser has the investment experience to manage and provide non-investment services (described in Section I) to the Strategy.

15 The Deli study, originally published in 2002 based on 1997 data and updated for the February 2008 Presentation, may be of diminished value due to the age of the data used in the presentation and the changes experienced in the industry since 2008.

16 As mentioned previously, the Supreme Court cautioned against accepting mutual fund fee comparisons without careful scrutiny since the fees may not be the product of negotiations conducted at arm’s length. See Jones v. Harris at 1429.

17 The two dimensional analysis showed patterns of lower advisory fees for funds with larger asset sizes and funds from larger family sizes compared to funds with smaller asset sizes and funds from smaller family sizes, which according to the independent consultant is indicative of a sharing of economies of scale and scope. However, in less liquid and active markets, such is not the case, as the empirical analysis showed potential for diseconomies of scale in those markets. The empirical analysis also showed diminishing economies of scale and scope as funds surpassed a certain high level of assets.

68 •  AB MUNICIPAL BOND INFLATION STRATEGY

The information below shows the 1, 3 and 5 year performance return and rankings of the Strategy¹⁸ relative to its Broadridge Performance Group (“PG”) and Broadridge Performance Universe (“PU”)¹⁹ for the period ended July 31, 2015.²⁰

Strategy	Strategy Return (%)		PG Median (%)		PU Median (%)		PG Rank	PU Rank
Municipal Bond Inflation Strategy
1 year		-2.93		2.23		2.12	14/14	51/53
3 year		-0.46		2.09		1.87	14/14	45/47
5 year		1.78		3.66		3.29	14/14	37/39

Set forth below are the 1, 3, 5 year and since inception net performance returns of the Strategy (in bold)²¹ versus its benchmark.²² Strategy and benchmark volatility and reward-to-variability ratio (“Sharpe Ratio”) information is also shown.²³

	Period Ending July 31, 2015 Annualized Performance
							Since		Annualized				Risk Period (Year)
	1 Year (%)		3 Year (%)		5 Year (%)		Inception (%)		Volatility (%)		Sharpe (%)
Municipal Bond Inflation Strategy		-2.93		-0.46		1.78		1.66		3.00		0.57		5
Barclays Capital 1-10yr TIPS Index		-1.80		-0.92		2.25		2.43		3.68		0.60		5
Inception Date: January 26, 2010

18 The performance returns and rankings are for the Class A shares of the Strategy. The performance returns of the Strategy were provided Broadridge.

19 The Strategy’s PG is identical to the Strategy’s EG. The Strategy’s PU is not identical to the Strategy’s EU as the criteria for including/excluding a Strategy in/from a PU are somewhat different from that of an EU.

20 The current Lipper investment classification/objective dictates the PG and PU throughout the life of the Strategy even if the Strategy may have had a different investment classification/objective at different points in time.

21 The performance returns and risk measures shown in the table are for the Class A shares of the Strategy.

22 The Adviser provided Strategy and benchmark performance return information for the periods through July 31, 2015.

23 Strategy and benchmark volatility and Sharpe Ratio information was obtained through Lipper LANA, a database maintained by Lipper. Volatility is a statistical measure of the tendency of a market price or yield to vary over time. A Sharpe Ratio is a risk adjusted measure of return that divides a fund’s return in excess of the riskless return by the fund’s standard deviation. A strategy with a greater volatility would be viewed as more risky than a strategy with equivalent performance but lower volatility; for that reason, a greater return would be demanded for the more risky fund. A strategy with a higher Sharpe Ratio would be viewed as better performing than a strategy with a lower Sharpe Ratio.

AB MUNICIPAL BOND INFLATION STRATEGY  • 69

CONCLUSION:

Based on the factors discussed above the Senior Officer’s conclusion is that the proposed advisory fee for the Strategy is reasonable and within the range of what would have been negotiated at arm’s-length in light of all the surrounding circumstances. This conclusion in respect of the Strategy is based on an evaluation of all of these factors and no single factor was dispositive.

Dated: November 25, 2015

70 •  AB MUNICIPAL BOND INFLATION STRATEGY

THIS PAGE IS NOT PART OF THE SHAREHOLDER REPORT OR THE FINANCIAL STATEMENTS

AB FAMILY OF FUNDS

US EQUITY

US Core

Core Opportunities Fund

Select US Equity Portfolio

US Growth

Concentrated Growth Fund

Discovery Growth Fund

Growth Fund

Large Cap Growth Fund

Small Cap Growth Portfolio

US Value

Discovery Value Fund

Equity Income Fund

Growth & Income Fund

Small Cap Value Portfolio

Value Fund

INTERNATIONAL/ GLOBAL EQUITY

International/Global Core

Global Core Equity Portfolio

Global Equity & Covered Call Strategy Fund

Global Thematic Growth Fund

International Portfolio

Tax-Managed International Portfolio

International/Global Growth

International Growth Fund

International/Global Value

Asia ex-Japan Equity Portfolio

International Value Fund

FIXED INCOME

Municipal

High Income Municipal Portfolio

Intermediate California Municipal Portfolio

Intermediate Diversified Municipal Portfolio

Intermediate New York Municipal Portfolio

Municipal Bond Inflation Strategy

FIXED INCOME (continued)

Tax-Aware Fixed Income Portfolio

National Portfolio

Arizona Portfolio

California Portfolio

Massachusetts Portfolio

Michigan Portfolio

Minnesota Portfolio

New Jersey Portfolio

New York Portfolio

Ohio Portfolio

Pennsylvania Portfolio

Virginia Portfolio

Taxable

Bond Inflation Strategy

Global Bond Fund

High Income Fund

High Yield Portfolio

Intermediate Bond Portfolio

Limited Duration High Income Portfolio

Short Duration Portfolio

ALTERNATIVES

All Market Real Return Portfolio*

Credit Long/Short Portfolio

Global Real Estate Investment Fund

Long/Short Multi-Manager Fund

Multi-Manager Alternative Strategies Fund

Select US Long/Short Portfolio

Unconstrained Bond Fund

MULTI-ASSET

All Market Growth Portfolio*

All Market Income Portfolio

Emerging Markets Multi-Asset Portfolio

Global Risk Allocation Fund

MULTI-ASSET (continued)

Target-Date

Multi-Manager Select Retirement Allocation Fund

Multi-Manager Select 2010 Fund

Multi-Manager Select 2015 Fund

Multi-Manager Select 2020 Fund

Multi-Manager Select 2025 Fund

Multi-Manager Select 2030 Fund

Multi-Manager Select 2035 Fund

Multi-Manager Select 2040 Fund

Multi-Manager Select 2045 Fund

Multi-Manager Select 2050 Fund

Multi-Manager Select 2055 Fund

Wealth Strategies

Balanced Wealth Strategy

Conservative Wealth Strategy

Wealth Appreciation Strategy

Tax-Managed Balanced Wealth Strategy

Tax-Managed Conservative Wealth Strategy

Tax-Managed Wealth Appreciation Strategy

CLOSED-END FUNDS

AB Multi-Manager Alternative Fund

Alliance California Municipal Income Fund

AllianceBernstein Global High Income Fund

AllianceBernstein Income Fund

AllianceBernstein National Municipal Income Fund

We also offer Exchange Reserves, which serves as the money market fund exchange vehicle for the AB mutual funds. An investment in Exchange Reserves is not a deposit in a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.

Investors should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.abglobal.com or contact your AB representative. Please read the prospectus and/or summary prospectus carefully before investing.

* Prior to December 15, 2014, All Market Growth Portfolio was named Dynamic All Market Fund; All Market Real Return Portfolio was named Real Asset Strategy.

AB MUNICIPAL BOND INFLATION STRATEGY  • 71

AB Family of Funds

NOTES

72 •  AB MUNICIPAL BOND INFLATION STRATEGY

NOTES

AB MUNICIPAL BOND INFLATION STRATEGY  • 73

NOTES

74 •  AB MUNICIPAL BOND INFLATION STRATEGY

NOTES

AB MUNICIPAL BOND INFLATION STRATEGY  • 75

NOTES

76 •  AB MUNICIPAL BOND INFLATION STRATEGY

AB MUNICIPAL BOND INFLATION STRATEGY

1345 Avenue of the Americas

New York, NY 10105

800.221.5672

MBIS-0151-1015                

OCT    ^10.31.15

ANNUAL REPORT

AB TAX-AWARE FIXED INCOME PORTFOLIO

Investment Products Offered

• Are Not FDIC Insured

• May Lose Value

• Are Not Bank Guaranteed

Investors should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.abglobal.com or contact your AB representative. Please read the prospectus and/or summary prospectus carefully before investing.

This shareholder report must be preceded or accompanied by the Fund’s prospectus for individuals who are not current shareholders of the Fund.

You may obtain a description of the Fund’s proxy voting policies and procedures, and information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30, without charge. Simply visit AB’s website at www.abglobal.com, or go to the Securities and Exchange Commission’s (the “Commission”) website at www.sec.gov, or call AB at (800) 227-4618.

The Fund files its complete schedule of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q are available on the Commission’s website at www.sec.gov. The Fund’s Forms N-Q may also be reviewed and copied at the Commission’s Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330. AB publishes full portfolio holdings for the Fund monthly at www.abglobal.com.

AllianceBernstein Investments, Inc. (ABI) is the distributor of the AB family of mutual funds. ABI is a member of FINRA and is an affiliate of AllianceBernstein L.P., the Adviser of the funds.

The [A/B] logo is a registered service mark of AllianceBernstein and AllianceBernstein^® is a registered service mark used by permission of the owner, AllianceBernstein L.P.

December 15, 2015

Annual Report

This report provides management’s discussion of fund performance for AB Tax-Aware Fixed Income Portfolio (the “Fund”) for the annual reporting period ended October 31, 2015. Effective January 20, 2015, the Fund’s name changed from AllianceBernstein Tax-Aware Fixed Income Portfolio to AB Tax-Aware Fixed Income Portfolio.

Investment Objectives and Policies

The investment objective of the Fund is to maximize after-tax return and income. The Fund pursues its objective by investing principally in a national portfolio of both municipal and taxable fixed-income securities. The Fund invests, under normal circumstances, at least 80% of its net assets in fixed-income securities. The Fund also invests, under normal circumstances, at least 65% of its total assets in municipal securities that pay interest that is exempt from Federal income tax. These securities may pay interest that is subject to the Federal alternative minimum tax (“AMT”) for certain taxpayers. The income earned and distributed to shareholders on non-municipal securities would not be exempt from Federal income tax. The Fund may invest in fixed-income securities rated below investment grade (commonly known as “junk bonds”), although such securities are not expected to be the Fund’s primary focus.

AllianceBernstein L.P. (the “Adviser”) selects securities for the Fund based on a variety of factors, including credit quality, maturity, diversification benefits, and the relative expected after-tax returns of taxable and municipal securities (considering Federal tax rates and

without regard to state and local income taxes). As the objective is to increase the after-tax return of the portfolio, an investor in the Fund may incur a tax liability that will generally be greater than the same investor would have in a fund investing exclusively in municipal securities, and that will be higher if the investor is in a higher tax bracket. In addition, the tax implications of the Fund’s trading activity, such as realizing taxable gains, are considered in making purchase and sale decisions for the Fund. The Fund may invest in fixed-income securities of any maturity from short- to long-term.

The Fund may also invest in forward commitments, zero-coupon municipal securities and variable, floating and inverse floating rate municipal securities.

The Fund may use derivatives, such as swaps, options, futures, and forwards, to achieve its investment strategies. For example, the Fund may enter into credit default and interest rate swaps relating to municipal and taxable fixed-income securities or securities indices. Derivatives may provide more efficient and economical exposure to fixed-income securities markets than direct investments.

Investment Results

The table on page 5 shows the Fund’s performance compared to its benchmark, the Barclays Municipal Bond Index, for the six- and 12-month periods ended October 31, 2015.

For the six-month period, Advisor Class and Class A shares outperformed the benchmark, while Class C shares

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 1

underperformed, before sales charges. All share classes underperformed the benchmark for the 12-month period, before sales charges. For the six-month period, security selection in the special tax, industrials, transportation and leasing sectors contributed to relative performance; security selection in the education sector detracted. During the 12-month period, sector selection in inflation-linked bonds detracted as did security selection in the state general obligation sector; security selection in the industrials, health care, leasing and insured sectors contributed positively. The impact to performance of owning taxable bonds versus comparable risk tax-exempts was immaterial, as was the impact of owning taxable bonds versus comparable risk tax-exempts.

The Fund used interest rate swaps and inflation (“CPI”) swaps for hedging purposes, over both periods and the effect on absolute performance was immaterial.

Market Review and Investment Strategy

During the reporting period, Treasury yields generally fell as the slowdown in China clouded the picture for economic growth in the United States. Commodity prices fell, emerging market economies sputtered, stock prices were volatile the US dollar strengthened. Over both periods, municipal bonds have generally had positive returns and even mid-grade and high-yield municipals performed well, in sharp contrast to the investment-grade and high-yield corporate bond markets. A general scarcity of municipal

credit issuance and an abundance of corporate-debt issuance partly explain the divergent returns in the markets.

Tax revenues for municipal issuers have been positive and the credit-worthiness of municipal mid-grade and high-yield issuers continues to improve modestly in step with the domestic economy. The Municipal Bond Investment Team has structured the Fund to be modestly overweight medium grade credit quality bonds.

The Fund may purchase municipal securities that are insured under policies issued by certain insurance companies. Historically, insured municipal securities typically received a higher credit rating, which meant that the issuer of the securities paid a lower interest rate. As a result of declines in the credit quality and associated downgrades of most fund insurers, insurance has less value than it did in the past. The market now values insured municipal securities primarily based on the credit quality of the issuer of the security with little value given to the insurance feature. In purchasing such insured securities, the Adviser evaluates the risk and return of municipal securities through its own research. If an insurance company’s rating is downgraded or the company becomes insolvent, the prices of municipal securities insured by the insurance company may decline. As of October 31, 2015, the Fund’s percentages of investments in municipal bonds that are insured and in insured municipal bonds that have been prerefunded or escrowed to maturity were 2.76% and 0%, respectively.

2 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

DISCLOSURES AND RISKS

Benchmark Disclosure

The unmanaged Barclays Municipal Bond Index does not reflect fees and expenses associated with the active management of a mutual fund portfolio. The Barclays Municipal Bond Index represents the performance of the long-term tax-exempt bond market consisting of investment grade bonds. An investor cannot invest directly in an index, and its results are not indicative of the performance for any specific investment, including the Fund.

A Word About Risk

Market Risk: The value of the Fund’s assets will fluctuate as the stock or bond market fluctuates. The value of the Fund’s investments may decline, sometimes rapidly and unpredictably, simply because of economic changes or other events that affect large portions of the market.

Credit Risk: An issuer or guarantor of a fixed-income security, or the counterparty to a derivatives or other contract, may be unable or unwilling to make timely payments of interest or principal, or to otherwise honor its obligations. The issuer or guarantor may default causing a loss of the full principal amount of a security. The degree of risk for a particular security may be reflected in its credit rating. There is the possibility that the credit rating of a fixed-income security may be downgraded after purchase, which may adversely affect the value of the security.

Below Investment Grade Securities Risk: Investments in fixed-income securities with lower ratings are subject to higher probability that an issuer will default or fail to meet its payment obligations. These securities may be subject to greater price volatility due to such factors as specific municipal or corporate developments, negative performance of the junk bond market generally and less secondary market liquidity.

Municipal Market Risk: This is the risk that special factors may adversely affect the value of municipal securities and have a significant effect on the yield or value of the Fund’s investments in municipal securities. These factors include economic conditions, political or legislative changes, uncertainties related to the tax status of municipal securities, or the rights of investors in these securities. To the extent that the Fund invests more of its assets in a particular state’s municipal securities, the Fund may be vulnerable to events adversely affecting that state, including economic, political and regulatory occurrences, court decisions, terrorism and catastrophic natural disasters, such as hurricanes or earthquakes. The Fund’s investments in certain municipal securities with principal and interest payments that are made from the revenues of a specific project or facility, and not general tax revenues, may have increased risks. Factors affecting the project or facility, such as local business or economic conditions, could have a significant effect on the project’s ability to make payments of principal and interest on these securities.

The Fund may invest in municipal securities of issuers in Puerto Rico or other US territories, which are exempt from federal, state, and, where applicable, local income taxes. These municipal securities may have more risks than those of most other US issuers of tax-exempt securities. Like many US states and municipalities, Puerto Rico experienced a significant downturn during the recent recession. Puerto Rico’s downturn was particularly severe, and it continues to face a very challenging economic and fiscal environment. As a result, securities issued by many Puerto Rican issuers have low credit ratings or are on “negative watch” by credit rating organizations, and markets in such securities have been volatile. If the economic situation in Puerto Rico persists or worsens, the volatility and credit quality of Puerto Rican municipal securities could be adversely affected, and the market for such securities may experience continued volatility.

Tax Risk: From time to time, the US Government and the US Congress consider changes in federal tax law that could limit or eliminate the federal tax exemption for municipal bond income, which would in effect reduce the income received by shareholders from the Fund by increasing taxes on that income. In such event, the Fund’s

(Disclosures, Risks and Note about Historical Performance continued on next page)

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 3

Disclosures and Risks

DISCLOSURES AND RISKS

(continued from previous page)

net asset value (“NAV”) could also decline as yields on municipal bonds, which are typically lower than those on taxable bonds, would be expected to increase to approximately the yield of comparable taxable bonds. Actions or anticipated actions affecting the tax exempt status of municipal bonds could also result in significant shareholder redemptions of Fund shares as investors anticipate adverse effects on the Fund or seek higher yields to offset the potential loss of the tax deduction. As a result, the Fund would be required to maintain higher levels of cash to meet the redemptions, which would negatively affect the Fund’s yield.

Interest Rate Risk: Changes in interest rates will affect the value of investments in fixed-income securities. When interest rates rise, the value of investments in fixed income securities tends to fall and this decrease in value may not be offset by higher income from new investments. Interest rate risk is generally greater for fixed-income securities with longer maturities or durations.

Duration Risk: Duration is a measure that relates the expected price volatility of a fixed-income security to changes in interest rates. The duration of a fixed-income security may be shorter than or equal to full maturity of a fixed-income security. Fixed income securities with longer durations have more risk and will decrease in price as interest rates rise. For example, a fixed income security with a duration of three years will decrease in value by approximately 3% if interest rates increase by 1%.

Inflation Risk: This is the risk that the value of assets or income from investments will be less in the future as inflation decreases the value of money. As inflation increases, the value of the Fund’s assets can decline as can the value of the Fund’s distributions. This risk is significantly greater for fixed-income securities with longer maturities.

Liquidity Risk: Liquidity risk exists when particular investments, such as lower-rated securities, are difficult to purchase or sell, possibly preventing the Fund from selling out of these illiquid securities at an advantageous price. Derivatives and securities involving substantial market and credit risk tend to involve greater liquidity risk. The Fund is subject to liquidity risk because the market for municipal securities is generally smaller than many other markets.

Derivatives Risk: Investments in derivatives may be illiquid, difficult to price, and leveraged so that small changes may produce disproportionate losses for the Portfolios, and may be subject to counterparty risk to a greater degree than more traditional investments.

Management Risk: The Fund is subject to management risk because it is an actively managed investment fund. The Adviser will apply its investment techniques and risk analyses in making investment decisions, but there is no guarantee that its techniques will produce the intended results.

These and other risks are more fully discussed in the Fund’s prospectus. As with all investments, you may lose money by investing in the Fund.

An Important Note About Historical Performance

The investment return and principal value of an investment in the Fund will fluctuate, so that shares, when redeemed, may be worth more or less than their original cost. Performance shown on the following pages represents past performance and does not guarantee future results. Current performance may be lower or higher than the performance information shown. You may obtain performance information current to the most recent month-end by visiting www.abglobal.com.

All fees and expenses related to the operation of the Fund have been deducted. NAV returns do not reflect sales charges; if sales charges were reflected, the Portfolios’ quoted performance would be lower. SEC returns and the Portfolios’ returns shown in the line graphs reflect the applicable sales charges for each share class: a 3% maximum front-end sales charge for Class A shares; a 1% 1 year contingent deferred sales charge for Class C shares. Returns for the different share classes will vary due to their different expenses associated with each class. Performance assumes reinvestment of distributions and does not account for taxes.

4 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Disclosures and Risks

HISTORICAL PERFORMANCE

THE FUND VS. ITS BENCHMARK PERIODS ENDED OCTOBER 31, 2015 (unaudited)	NAV Returns
	6 Months		12 Months
AB Tax-Aware Fixed Income Portfolio
Class A		1.70%		2.64%
Class C		1.22%		1.78%
Advisor Class*		1.73%		2.81%
Barclays Municipal Bond Index		1.68%		2.87%
*    Please note that Advisor Class shares are for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/ or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Fund.

GROWTH OF A $10,000 INVESTMENT IN THE FUND

12/11/13* TO 10/31/15 (unaudited)

This chart illustrates the total value of an assumed $10,000 investment in AB Tax-Aware Fixed Income Portfolio Class A shares (from 12/11/2013* to 10/31/15) as compared to the performance of its benchmark. The chart reflects the deduction of the maximum 3.00% sales charge from the initial $10,000 investment in the Strategy and assumes the reinvestment of dividends and capital gains distributions.

* Inception date: 12/11/2013.

See Disclosures, Risks and Note about Historical Performance on pages 3-4.

(Historical Performance continued on next page)

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 5

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

AVERAGE ANNUAL RETURNS AS OF OCTOBER 31, 2015 (unaudited)
	NAV Returns			SEC Returns (reflects applicable sales charges)
Class A
1 Year		2.64	%		-0.49	%
Since Inception*		4.80	%		3.12	%
Class C
1 Year		1.78	%		0.78	%
Since Inception*		4.06	%		4.06	%
Advisor Class†
1 Year		2.81	%		2.81	%
Since Inception*		5.10	%		5.10	%

The Fund’s current prospectus fee table shows the Fund’s total annual operating expense ratios as 3.54%, 4.33% and 3.82% for Class A, Class C and Advisor Class, respectively, gross of any fee waivers or expense reimbursements. Contractual fee waivers and/or expense reimbursements will limit the Fund’s annual operating expenses, excluding any interest expense, to 0.80%, 1.55% and 0.55% for Class A, Class C and Advisor Class, respectively. These waivers/ reimbursements may not be terminated prior to January 30, 2016 and may be extended by the Adviser for additional one-year terms. Absent reimbursements or waivers, performance would have been lower. The Financial Highlights section of this report sets forth expense ratio data for the current reporting period; the expense ratios shown above may differ from the expense ratios in the Financial Highlights section since they are based on different time periods.

* Inception date: 12/11/2013.

^†  Please note that this share class is for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Fund.

See Disclosures, Risks and Note about Historical Performance on pages 3-4.

(Historical Performance continued on next page)

6 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Historical Performance

HISTORICAL PERFORMANCE

(continued from previous page)

SEC AVERAGE ANNUAL RETURNS AS OF THE MOST RECENT CALENDAR QUARTER-END SEPTEMBER 30, 2015 (unaudited)
	SEC Returns (reflects applicable sales charges)
Class A
1 Year		-0.53	%
Since Inception*		2.95	%
Class C
1 Year		0.85	%
Since Inception*		4.04	%
Advisor Class†
1 Year		2.88	%
Since Inception*		5.07	%

* Inception date: 12/11/2013.

^†  Please note that this share class is for investors purchasing shares through accounts established under certain fee-based programs sponsored and maintained by certain broker-dealers and financial intermediaries, institutional pension plans and/or investment advisory clients of, and certain other persons associated with, the Adviser and its affiliates or the Fund.

See Disclosures, Risks and Note about Historical Performance on pages 3-4.

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 7

Historical Performance

EXPENSE EXAMPLE

(unaudited)

As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, contingent deferred sales charges on redemptions and (2) ongoing costs, including management fees; distribution (12b-1) fees; and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period as indicated below.

Actual Expenses

The table below provides information about actual account values and actual expenses. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed annual rate of return of 5% before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds by comparing this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), or contingent deferred sales charges on redemptions. Therefore, the hypothetical example is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Beginning Account Value May 1, 2015		Ending Account Value October 31, 2015		Expenses Paid During Period*		Annualized Expense Ratio*
Class A
Actual	$	1,000	$	1,017.00	$	4.07		0.80	%
Hypothetical**	$	1,000	$	1,021.17	$	4.08		0.80	%
Class C
Actual	$	1,000	$	1,012.20	$	7.86		1.55	%
Hypothetical**	$	1,000	$	1,017.39	$	7.88		1.55	%
Advisor Class
Actual	$	1,000	$	1,017.30	$	2.80		0.55	%
Hypothetical**	$	1,000	$	1,022.43	$	2.80		0.55	%

* Expenses are equal to the classes’ annualized expense ratios multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).

** Assumes 5% annual return before expenses.

8 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Expense Example

PORTFOLIO SUMMARY

October 31, 2015 (unaudited)

PORTFOLIO STATISTICS

Net Assets ($mil): $32.6

* All data are as of October 31, 2015. The Fund’s quality rating and state breakdowns are expressed as a percentage of the Fund’s total investments in municipal securities and may vary over time. The Fund also enters into derivative transactions, which may be used for hedging or investment purposes (see “Portfolio of Investments” section of the report for additional details). The quality ratings are determined by using the Standard & Poor’s Ratings Services (“S&P”), Moody’s Investors Services, Inc.(“Moody’s”) and Fitch Ratings, Ltd.(“Fitch”). The Fund considers the credit ratings issued by S&P, Moody’s, and Fitch and uses the highest rating issued by the agencies, including when there is a split rating. These ratings are a measure of the quality and safety of a bond or portfolio, based on the issuer’s financial condition. AAA is the highest (best) and D is the lowest (worst). If applicable, the pre-refunded category includes bonds which are secured by U.S. Government Securities and therefore are deemed high-quality investment grade by the Adviser. If applicable, Not Applicable (N/A) includes non credit worthy investments; such as, equities, currency contracts, futures and options. If applicable, the Not Rated category includes bonds that are not rated by a nationally recognized statistical rating organization. The Adviser evaluates the creditworthiness of non-rated securities based on a number of factors including, but not limited to, cash flows, enterprise value and economic environment.

^†  “Other” represents less than 1.4% in 15 different states and Puerto Rico.

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 9

Portfolio Summary

PORTFOLIO OF INVESTMENTS

October 31, 2015

	Principal Amount (000)		U.S. $ Value
MUNICIPAL OBLIGATIONS – 89.1%
Long-Term Municipal Bonds – 89.1%
Alabama – 0.4%
County of Jefferson AL Sewer Revenue Series 2013D 6.00%, 10/01/42	$	110	$	123,473
Arizona – 2.1%
Arizona Health Facilities Authority (Beatitudes Campus (The)) Series 2007 5.20%, 10/01/37		110		108,089
City of Phoenix Civic Improvement Corp. Series 2014B 5.00%, 7/01/22		300		362,067
Industrial Development Authority of the City of Phoenix (The) (Great Hearts Academies) Series 2014 5.00%, 7/01/44(a)		100		100,973
Salt Verde Financial Corp. (Citigroup, Inc.) Series 2007 5.00%, 12/01/37		100		111,589
				682,718
California – 1.2%
California Pollution Control Financing Authority (Poseidon Resources Channelside LP) Series 2012 5.00%, 11/21/45(a)		250		263,728
Golden State Tobacco Securitization Corp. Series 2007A-1 5.125%, 6/01/47		165		139,149
				402,877
Colorado – 3.4%
Colorado Health Facilities Authority (Catholic Health Initiatives) Series 2013 5.25%, 1/01/40		170		185,536
Colorado Health Facilities Authority (Parkview Medical Center, Inc. Obligated Group) Series 2015B 5.00%, 9/01/30		200		222,288
Denver City & County School District No 1 Series 2014B 5.00%, 12/01/23		560		688,912
				1,096,736

10 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
Connecticut – 0.5%
State of Connecticut Series 2014C 5.00%, 12/15/22	$	130	$	155,168
Florida – 10.6%
Brevard County School District COP Series 2015B 5.00%, 7/01/25		290		346,637
Capital Trust Agency, Inc. (Million Air One LLC) Series 2011 7.75%, 1/01/41		100		94,514
Citizens Property Insurance Corp. Series 2015A 5.00%, 6/01/20-6/01/22		560		649,333
Collier County Industrial Development Authority (Arlington of Naples (The)) Series 2014A 8.125%, 5/15/44(a)		100		116,863
County of Miami-Dade FL (County of Miami-Dade FL Non-Ad Valorem) Series 2015A 5.00%, 6/01/28		780		895,682
County of Miami-Dade FL Aviation Revenue Series 2015A 5.00%, 10/01/31		265		297,325
County of Orange FL Tourist Development Tax Revenue Series 2015 5.00%, 10/01/21		435		517,250
Florida Development Finance Corp. (Tuscan Isle Obligated Group) Series 2015A 7.00%, 6/01/35(a)		100		103,804
School District of Broward County/FL Series 2015 5.00%, 7/01/25		365		439,383
				3,460,791
Georgia – 1.1%
City of Atlanta Department of Aviation (Hartsfield Jackson Atlanta Intl Airport) Series 2012A 5.00%, 1/01/31		310		350,945
Hawaii – 1.7%
State of Hawaii Series 2015E 5.00%, 10/01/23		460		561,600

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 11

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
Idaho – 0.3%
Idaho Health Facilities Authority (The Terraces at Boise) Series 2014A 8.00%, 10/01/44	$	100	$	104,628
Illinois – 8.2%
Chicago Board of Education Series 2012A 5.00%, 12/01/42		40		34,486
Chicago O’Hare International Airport Series 2015C 5.00%, 1/01/34		335		362,061
City of Chicago IL (Goldblatts Supportive Living Project) Series 2015 6.00%, 12/01/30(b)		100		100,365
Illinois Finance Authority (Greenfields of Geneva) Series 2010A 8.125%, 2/15/40		50		52,511
Illinois Finance Authority (Park Place of Elmhurst) Series 2010A 8.125%, 5/15/40		100		60,231
Illinois Finance Authority (Plymouth Place, Inc.) Series 2015 5.25%, 5/15/50		100		99,681
Illinois Finance Authority (Silver Cross Hospital Obligated Group) Series 2015C 5.00%, 8/15/35		250		272,808
Illinois Municipal Electric Agency Series 2015A 5.00%, 2/01/22		465		544,673
Metropolitan Pier & Exposition Authority Series 2015B 5.00%, 12/15/45		600		618,228
State of Illinois Series 2012 5.00%, 3/01/31		100		103,499
Series 2013 5.50%, 7/01/25		270		298,914
Series 2014 5.00%, 5/01/35		130		133,898
				2,681,355

12 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
Indiana – 1.5%
Indiana Finance Authority (Bethany Circle of King’s Daughters’ of Madison Indiana, Inc. (The)) Series 2010 5.50%, 8/15/40	$	160	$	174,406
Indiana Finance Authority (Marquette Manor) Series 2015A 5.00%, 3/01/30		190		203,131
Indiana Finance Authority (WVB East End Partners LLC) Series 2013A 5.00%, 7/01/40		100		104,256
				481,793
Iowa – 0.9%
Iowa Finance Authority (Iowa Finance Authority SRF) Series 2015 5.00%, 8/01/18		255		284,501
Kentucky – 0.2%
Kentucky Economic Development Finance Authority (Masonic Homes of Kentucky, Inc. Obligated Group) Series 2012 5.375%, 11/15/42		65		64,313
Louisiana – 1.1%
City of New Orleans LA Water Revenue Series 2014 5.00%, 12/01/34		100		110,917
Louisiana Public Facilities Authority (Louisiana Pellets, Inc.) Series 2014A 7.50%, 7/01/23		250		258,175
				369,092
Maine – 0.6%
Maine Health & Higher Educational Facilities Authority (MaineGeneral Health Obligated Group) Series 2011 7.50%, 7/01/32		165		195,347
Maryland – 1.2%
University System of Maryland Series 2009A 5.00%, 4/01/18		365		402,416

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 13

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
Massachusetts – 0.4%
Commonwealth of Massachusetts NATL Series 2000E 0.105%, 12/01/30(c)	$	125	$	116,140
Michigan – 4.3%
City of Detroit MI Sewage Disposal System Revenue Series 2012A 5.00%, 7/01/22		115		130,267
Michigan Finance Authority (Detroit City School District State Aid) Series 2015E 5.75%, 8/22/16(a)		200		199,944
Michigan Finance Authority (State of Michigan Unemployment) Series 2012B 5.00%, 7/01/21		735		816,438
Michigan Finance Authority (Trinity Health Credit Group) Series 2015 5.00%, 12/01/32		235		260,190
				1,406,839
Minnesota – 2.9%
City of Minneapolis MN (Fairview Health Services Obligated Group) Series 2015A 5.00%, 11/15/33		200		225,914
Housing & Redevelopment Authority of The City of St Paul Minnesota (HealthEast Obligated Group) Series 2015A 5.25%, 11/15/35		100		107,482
State of Minnesota Series 2010E 5.00%, 8/01/17		580		624,567
				957,963
Nebraska – 0.3%
Central Plains Energy Project (Goldman Sachs Group, Inc. (The)) Series 2012 5.00%, 9/01/42		100		107,212
New Hampshire – 0.4%
New Hampshire Health and Education Facilities Authority Act (Southern New Hampshire University) Series 2012 5.00%, 1/01/42		115		118,805

14 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
New Jersey – 3.9%
Burlington County Bridge Commission (Evergreens (The)) Series 2007 5.625%, 1/01/38	$	140	$	142,131
New Jersey Economic Development Authority Series 2013NN 5.00%, 3/01/20 (Pre-refunded/ETM)		30		34,640
New Jersey Economic Development Authority (New Jersey Economic Development Authority State Lease) Series 2013 5.00%, 3/01/20		260		280,826
New Jersey Economic Development Authority (United Airlines, Inc.) Series 1999 5.25%, 9/15/29		85		92,440
New Jersey Transportation Trust Fund Authority (New Jersey Transportation Trust Fund Authority State Lease) Series 2011B 5.00%, 6/15/20		240		260,424
New Jersey Turnpike Authority Series 2013A 5.00%, 1/01/32		315		353,159
Tobacco Settlement Financing Corp./NJ Series 20071A 5.00%, 6/01/41		115		92,501
				1,256,121
New York – 6.4%
Build NYC Resource Corp. (South Bronx Charter School for International Cultures & The Arts) Series 2013A 5.00%, 4/15/43		100		97,091
City of New York NY Series 2013J 5.00%, 8/01/21		340		403,373
Metropolitan Transportation Authority Series 2013A 5.00%, 11/15/29		315		366,165
New York State Dormitory Authority (State of New York Pers Income Tax) Series 2014A 5.00%, 2/15/28		425		500,531

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 15

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
New York State Energy Research & Development Authority (Consolidated Edison Co. of New York, Inc.) XLCA Series 2004A 0.171%, 1/01/39(c)	$	200	$	178,925
New York State Thruway Authority (New York State Thruway Authority Ded Tax) Series 2012A 5.00%, 4/01/26		365		429,587
Ulster County Industrial Development Agency (Kingston Regional Senior Living Corp.) Series 2007A 6.00%, 9/15/27		120		120,913
				2,096,585
Ohio – 4.9%
Buckeye Tobacco Settlement Financing Authority Series 2007A-2 5.875%, 6/01/47		110		94,095
City of Akron OH (City of Akron OH Income Tax) Series 2012A 5.00%, 12/01/31		445		505,124
City of Columbus OH Series 2012A 5.00%, 2/15/17		225		238,234
Series 2014A 5.00%, 2/15/21		110		130,457
County of Cuyahoga OH (County of Cuyahoga OH Lease) Series 2014 5.00%, 12/01/28		365		420,422
Dayton-Montgomery County Port Authority (StoryPoint Troy Project) Series 20151 7.00%, 1/15/40		100		100,053
Ohio Air Quality Development Authority (FirstEnergy Nuclear Generation LLC) Series 2010B 3.75%, 6/01/33		100		102,493
				1,590,878
Pennsylvania – 4.4%
Commonwealth of Pennsylvania Series 2013 5.00%, 4/01/17		380		403,579
Montour School District AGM Series 2015B 5.00%, 4/01/35		450		508,104

16 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
Moon Industrial Development Authority (Baptist Home Society Obligated Group) Series 2015 5.75%, 7/01/35	$	100	$	99,293
Pennsylvania Economic Development Financing Authority (Commonwealth of Pennsylvania Unemployment) Series 2012A 5.00%, 7/01/17		100		107,370
Pennsylvania Economic Development Financing Authority (PA Bridges Finco LP) Series 2015 5.00%, 12/31/38		300		320,166
				1,438,512
Puerto Rico – 0.3%
Puerto Rico Industrial Tourist Educational Medical & Envirml Ctl Facs Fing Auth (AES Puerto Rico LP) Series 2000 6.625%, 6/01/26		100		92,001
South Carolina – 0.9%
Spartanburg County School District No 1/SC Series 2014D 5.00%, 3/01/22		250		300,600
Texas – 19.0%
Central Texas Regional Mobility Authority Series 2013 5.00%, 1/01/42		100		105,783
City of Houston TX (City of Houston TX Hotel Occupancy Tax) Series 2014 5.00%, 9/01/31		260		295,508
Series 2015 5.00%, 9/01/31		160		181,851
Dallas Area Rapid Transit (Dallas Area Rapid Transit Sales Tax) Series 2014A 5.00%, 12/01/25		580		709,723
Dallas County Flood Control District No 1 Series 2015 5.00%, 4/01/28(d)		100		101,720
Grand Parkway Transportation Corp. Series 2014A 3.00%, 12/15/16		285		292,806

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 17

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
Love Field Airport Modernization Corp. Series 2015 5.00%, 11/01/32	$	500	$	568,200
New Hope Cultural Education Facilities Corp. (Wesleyan Homes, Inc.) Series 2014 5.50%, 1/01/49		100		99,388
North Texas Tollway Authority Series 2015B 5.00%, 1/01/34		250		280,195
Tarrant County Cultural Education Facilities Finance Corp. (Trinity Terrace Project) Series 2014A-1 5.00%, 10/01/44		100		103,632
Tarrant Regional Water District Series 2015 5.00%, 3/01/23		325		393,829
Texas Transportation Commission State Highway Fund Series 2014A 5.00%, 4/01/20		1,300		1,513,915
Travis County Cultural Education Facilities Finance Corp. (Wayside Schools) Series 2012A 5.25%, 8/15/42		160		161,975
Travis County Health Facilities Development Corp. (Longhorn Village) Series 2012A 7.125%, 1/01/46		55		61,335
Trinity River Authority Central Regional Wastewater System Revenue Series 2014 5.00%, 8/01/20-8/01/22		795		938,313
Trinity River Authority LLC Series 2015 5.00%, 2/01/21		335		392,409
				6,200,582
Virginia – 0.2%
Tobacco Settlement Financing Corp/VA Series 2007B1 5.00%, 6/01/47		100		75,182
Washington – 5.8%
City of Seattle WA Series 2014 5.00%, 5/01/17		125		133,349

18 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
City of Seattle WA Municipal Light & Power Revenue Series 2014 5.00%, 9/01/22	$	555	$	670,551
Port of Seattle WA Series 2015C 5.00%, 4/01/33		510		561,535
State of Washington Series 2011R 5.00%, 7/01/17		380		407,873
Washington State Housing Finance Commission (Rockwood Retirement Communities) Series 2014A 7.375%, 1/01/44(a)		100		112,532
				1,885,840
Total Municipal Obligations (cost $28,243,461)				29,061,013
CORPORATES – INVESTMENT GRADE – 1.2%
Financial Institutions – 0.7%
Banking – 0.6%
JPMorgan Chase & Co. 0.834%, 3/01/18(e)		120		119,219
Morgan Stanley 1.75%, 2/25/16		70		70,249
				189,468
REITS – 0.1%
Welltower, Inc. 3.625%, 3/15/16		50		50,509
				239,977
Industrial – 0.5%
Consumer Non-Cyclical – 0.2%
Bunge Ltd. Finance Corp. 4.10%, 3/15/16		50		50,498
Energy – 0.1%
Kinder Morgan Energy Partners LP 3.50%, 3/01/16		50		50,353
Technology – 0.2%
Xerox Corp. 6.40%, 3/15/16		50		50,892
				151,743
Total Corporates – Investment Grade (cost $392,566)				391,720

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 19

Portfolio of Investments

	Principal Amount (000)		U.S. $ Value
ASSET-BACKED SECURITIES – 1.0%
Autos - Fixed Rate – 0.7%
Chrysler Capital Auto Receivables Trust Series 2014-BA, Class A2 0.69%, 9/15/17(a)	$	32	$	31,745
Hyundai Auto Lease Securitization Trust Series 2015-A, Class A2 1.00%, 10/16/17(a)		100		100,039
Volkswagen Auto Loan Enhanced Trust Series 2014-1, Class A3 0.91%, 10/22/18		100		99,466
				231,250
Credit Cards - Floating Rate – 0.3%
Cabela’s Credit Card Master Note Trust Series 2012-2A, Class A2 0.676%, 6/15/20(a)(e)		100		99,802
Total Asset-Backed Securities (cost $331,804)				331,052
	Shares
SHORT-TERM INVESTMENTS – 7.3%
Investment Companies – 7.3%
AB Fixed Income Shares, Inc. – Government STIF Portfolio, 0.13%(f)(g) (cost $2,385,557)		2,385,557		2,385,557
Total Investments – 98.6% (cost $31,353,388)				32,169,342
Other assets less liabilities – 1.4%				464,210
Net Assets – 100.0%			$	32,633,552

INFLATION (CPI) SWAPS (see Note D)

					Rate Type
Swap Counterparty	Notional Amount (000)		Termination Date		Payments made by the Fund			Payments received by the Fund			Unrealized Appreciation/ (Depreciation)
Bank of America, NA	$	100		9/04/20		1.450	%		CPI	#	$	(81	)
Citibank, NA		200		9/15/20		1.451	%		CPI	#		(159	)
											$	(240	)

# Variable interest rate based on the rate of inflation as determined by the Consumer Price Index (CPI).

20 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Portfolio of Investments

INTEREST RATE SWAPS (see Note D)

Rate Type

Swap Counterparty

Notional Amount (000)

Termination Date

Payments made by the Fund

Payments received by the Fund

Unrealized Appreciation/ (Depreciation)

Citibank, NA

$

500

10/20/22

1.140

%

SIFMA

*

$

1,088

* Variable interest rate based on the Securities Industry & Financial Markets Association (SIFMA) Municipal Swap Index.

(a) Security is exempt from registration under Rule 144A of the Securities Act of 1933. These securities are considered liquid and may be resold in transactions exempt from registration, normally to qualified institutional buyers. At October 31, 2015, the aggregate market value of these securities amounted to $1,129,430 or 3.5% of net assets.

(b) Coupon rate adjusts periodically based upon a predetermined schedule. Stated interest rate in effect at October 31, 2015.

(c) An auction rate security whose interest rate resets at each auction date. Auctions are typically held every week or month. The rate shown is as of October 31, 2015 and the aggregate market value of these securities amounted to $295,065 or 0.90% of net assets.

(d) When-Issued or delayed delivery security.

(e) Floating Rate Security. Stated interest rate was in effect at October 31, 2015.

(f) To obtain a copy of the fund’s financial statements, please go to the Securities and Exchange Commission’s website at www.sec.gov, or call AB at (800) 227-4618.

(g) Investment in affiliated money market mutual fund. The rate shown represents the 7-day yield as of period end.

As of October 31, 2015, the Fund’s percentages of investments in municipal bonds that are insured and in insured municipal bonds that have been pre-refunded or escrowed to maturity are 2.8% and 0.0%, respectively.

Glossary:

AGM – Assured Guaranty Municipal

COP – Certificate of Participation

ETM – Escrowed to Maturity

NATL – National Interstate Corporation

REIT – Real Estate Investment Trust

SRF – State Revolving Fund

XLCA – XL Capital Assurance Inc.

See notes to financial statements.

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 21

Portfolio of Investments

STATEMENT OF ASSETS & LIABILITIES

October 31, 2015

Assets
Investments in securities, at value
Unaffiliated issuers (cost $28,967,831)	$	29,783,785
Affiliated issuers (cost $2,385,557)		2,385,557
Cash		161,472
Interest receivable		334,946
Receivable for capital stock sold		290,901
Receivable due from Adviser		28,245
Unrealized appreciation on interest rate swaps		1,088
Total assets		32,985,994
Liabilities
Payable for capital stock redeemed		108,282
Payable for investment securities purchased		101,969
Audit and tax fee payable		53,035
Registration fee payable		21,223
Dividends payable		18,466
Distribution fee payable		2,301
Transfer Agent fee payable		1,613
Unrealized depreciation on inflation swaps		240
Accrued expenses		45,313
Total liabilities		352,442
Net Assets	$	32,633,552
Composition of Net Assets
Capital stock, at par	$	3,082
Additional paid-in capital		31,840,786
Undistributed net investment income		13,754
Accumulated net realized loss on investment transactions		(40,872	)
Net unrealized appreciation on investments		816,802
	$	32,633,552

Net Asset Value Per Share—18 billion shares of capital stock authorized, $.001 par value

Class	Net Assets		Shares Outstanding		Net Asset Value
A	$	4,783,032		451,785	$	10.59	*
C	$	1,517,743		143,331	$	10.59
Advisor	$	26,332,777		2,486,835	$	10.59

* The maximum offering price per share for Class A shares was $10.92 which reflects a sales charge of 3.0%.

See notes to financial statements.

22 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Statement of Assets & Liabilities

STATEMENT OF OPERATIONS

Year Ended October 31, 2015

Investment Income
Interest	$	648,310
Dividends—Affiliated issuers		1,650		$	649,960
Expenses
Advisory fee (see Note B)		127,771
Distribution fee—Class A		7,589
Distribution fee—Class C		12,048
Transfer agency—Class A		2,656
Transfer agency—Class C		1,093
Transfer agency—Advisor Class		19,582
Custodian		81,977
Audit and tax		58,185
Registration fees		53,966
Administrative		50,921
Legal		38,487
Printing		20,853
Directors’ fees		17,177
Amortization of offering expenses		15,066
Miscellaneous		2,479
Total expenses		509,850
Less: expenses waived and reimbursed by the Adviser (see Note B)		(349,529	)
Net expenses					160,321
Net investment income					489,639
Realized and Unrealized Gain (Loss) on Investment Transactions
Net realized loss on investment transactions					(36,858	)
Net change in unrealized appreciation/depreciation of:
Investments					227,485
Swaps					848
Net gain on investment transactions					191,475
Net Increase in Net Assets from Operations				$	681,114

See notes to financial statements.

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 23

Statement of Operations

STATEMENT OF CHANGES IN NET ASSETS

	Year Ended October 31, 2015			December 11,  2013(a) to October 31, 2014
Increase (Decrease) in Net Assets from Operations
Net investment income	$	489,639		$	202,860
Net realized gain (loss) on investment transactions		(36,858	)		21,853
Net change in unrealized appreciation/depreciation of investments		228,333			588,469
Net increase in net assets from operations		681,114			813,182
Dividends and Distributions to Shareholders from
Net investment income
Class A		(51,320	)		(8,422	)
Class C		(11,889	)		(900	)
Advisor Class		(426,246	)		(193,956	)
Net realized gain on investment transactions
Class A		(2,414	)		– 0	–
Class C		(440	)		– 0	–
Advisor Class		(19,264	)		– 0	–
Capital Stock Transactions
Net increase		15,557,455			16,296,652
Total increase		15,726,996			16,906,556
Net Assets
Beginning of period		16,906,556			– 0	–
End of period (including undistributed net investment income of $13,754 and $4,558, respectively)	$	32,633,552		$	16,906,556

(a) Commencement of operations.

See notes to financial statements.

24 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Statement of Changes in Net Assets

NOTES TO FINANCIAL STATEMENTS

October 31, 2015

NOTE A

Significant Accounting Policies

AB Bond Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940 as an open-end management investment company. Prior to January 20, 2015, the Fund was known as AllianceBernstein Bond Fund, Inc. The Fund, which is a Maryland corporation, operates as a series company comprised of nine portfolios currently in operation: the AB Intermediate Bond Portfolio, the AB Bond Inflation Strategy Portfolio, the AB Municipal Bond Inflation Strategy Portfolio, the AB All Market Real Return Portfolio (formerly AllianceBernstein Real Asset Strategy), the AB Limited Duration High Income Portfolio, the AB Government Reserves Portfolio, the AB Tax-Aware Fixed Income Portfolio, the AB Credit Long/Short Portfolio and the AB High Yield Portfolio. They are each diversified portfolios, with the exception of the AB Credit Long/Short Portfolio and the AB High Yield Portfolio, which are non-diversified. Each portfolio is considered to be a separate entity for financial reporting and tax purposes. This report relates only to the AB Tax-Aware Fixed Income Portfolio (the “Portfolio”). Prior to January 20, 2015, the Portfolio was known as AllianceBernstein Tax-Aware Fixed Income Portfolio. The Portfolio has authorized the issuance of Class A, Class B, Class C, Advisor Class, Class 1 and Class 2 shares. Class B, Class 1 and Class 2 shares are not currently being offered. Class A shares are sold with a front-end sales charge of up to 3.0% for purchases not exceeding $500,000. With respect to purchases of $500,000 or more, Class A shares redeemed within one year of purchase may be subject to a contingent deferred sales charge of 1%. Class C shares are subject to a contingent deferred sales charge of 1% on redemptions made within the first year after purchase. Advisor Class shares are sold without any initial or contingent deferred sales charge and are not subject to ongoing distribution expenses. All six classes of shares have identical voting, dividend, liquidation and other rights, except that the classes bear different distribution and transfer agency expenses. Each class has exclusive voting rights with respect to its distribution plan. The financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) which require management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements and amounts of income and expenses during the reporting period. Actual results could differ from those estimates. The Fund is an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. The following is a summary of significant accounting policies followed by the Portfolio.

1. Security Valuation

Portfolio securities are valued at their current market value determined on the basis of market quotations or, if market quotations are not readily available or are deemed unreliable, at “fair value” as determined in accordance with procedures established by and under the general supervision of the Fund’s Board of Directors (the “Board”).

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 25

Notes to Financial Statements

In general, the market values of securities which are readily available and deemed reliable are determined as follows: securities listed on a national securities exchange (other than securities listed on the NASDAQ Stock Market, Inc. (“NASDAQ”)) or on a foreign securities exchange are valued at the last sale price at the close of the exchange or foreign securities exchange. If there has been no sale on such day, the securities are valued at the last traded price from the previous day. Securities listed on more than one exchange are valued by reference to the principal exchange on which the securities are traded; securities listed only on NASDAQ are valued in accordance with the NASDAQ Official Closing Price; listed or over the counter (“OTC”) market put or call options are valued at the mid level between the current bid and ask prices. If either a current bid or current ask price is unavailable, AllianceBernstein L.P. (the “Adviser”) will have discretion to determine the best valuation (e.g. last trade price in the case of listed options); open futures are valued using the closing settlement price or, in the absence of such a price, the most recent quoted bid price. If there are no quotations available for the day of valuation, the last available closing settlement price is used; U.S. Government securities and any other debt instruments having 60 days or less remaining until maturity are generally valued at market by an independent pricing vendor, if a market price is available. If a market price is not available, the securities are valued at amortized cost. This methodology is commonly used for short term securities that have an original maturity of 60 days or less, as well as short term securities that had an original term to maturity that exceeded 60 days. In instances when amortized cost is utilized, the Valuation Committee (the “Committee”) must reasonably conclude that the utilization of amortized cost is approximately the same as the fair value of the security. Such factors the Committee will consider include, but are not limited to, an impairment of the creditworthiness of the issuer or material changes in interest rates. Fixed-income securities, including mortgage-backed and asset-backed securities, may be valued on the basis of prices provided by a pricing service or at a price obtained from one or more of the major broker-dealers. In cases where broker-dealer quotes are obtained, the Adviser may establish procedures whereby changes in market yields or spreads are used to adjust, on a daily basis, a recently obtained quoted price on a security. Swaps and other derivatives are valued daily, primarily using independent pricing services, independent pricing models using market inputs, as well as third party broker-dealers or counterparties. Investment companies are valued at their net asset value each day.

Securities for which market quotations are not readily available (including restricted securities) or are deemed unreliable are valued at fair value. Factors considered in making this determination may include, but are not limited to, information obtained by contacting the issuer, analysts, analysis of the issuer’s financial statements or other available documents. In addition, the Portfolio may use fair value pricing for securities primarily traded in non-U.S. markets because most foreign markets close well before the Portfolio values its securities at 4:00 p.m., Eastern Time. The earlier close of these foreign markets gives rise to

26 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Notes to Financial Statements

the possibility that significant events, including broad market moves, may have occurred in the interim and may materially affect the value of those securities.

2. Fair Value Measurements

In accordance with U.S. GAAP regarding fair value measurements, fair value is defined as the price that the Portfolio would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP establishes a framework for measuring fair value, and a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability (including those valued based on their market values as described in Note A.1 above). Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Portfolio. Unobservable inputs reflect the Portfolio’s own assumptions about the assumptions that market participants would use in pricing the asset or liability based on the best information available in the circumstances. Each investment is assigned a level based upon the observability of the inputs which are significant to the overall valuation. The three-tier hierarchy of inputs is summarized below.

• Level 1—quoted prices in active markets for identical investments

• Level 2—other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

• Level 3—significant unobservable inputs (including the Portfolio’s own assumptions in determining the fair value of investments)

The fair value of debt instruments, such as bonds, and over-the-counter derivatives is generally based on market price quotations, recently executed market transactions (where observable) or industry recognized modeling techniques and are generally classified as Level 2. Pricing vendor inputs to Level 2 valuations may include quoted prices for similar investments in active markets, interest rate curves, coupon rates, currency rates, yield curves, option adjusted spreads, default rates, credit spreads and other unique security features in order to estimate the relevant cash flows which are then discounted to calculate fair values. If these inputs are unobservable and significant to the fair value, these investments will be classified as Level 3. In addition, non-agency rated investments are classified as Level 3.

Valuations of mortgage-backed or other asset-backed securities, by pricing vendors, are based on both proprietary and industry recognized models and discounted cash flow techniques. Significant inputs to the valuation of these instruments are value of the collateral, the rates and timing of delinquencies, the rates and timing of prepayments, and default and loss expectations, which are driven in part by housing prices for residential mortgages. Significant inputs are determined based on relative value analyses, which incorporate comparisons to

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 27

Notes to Financial Statements

instruments with similar collateral and risk profiles, including relevant indices. Mortgage and asset-backed securities for which management has collected current observable data through pricing services are generally categorized within Level 2. Those investments for which current observable data has not been provided are classified as Level 3.

Other fixed income investments, including non-U.S. government and corporate debt, are generally valued using quoted market prices, if available, which are typically impacted by current interest rates, maturity dates and any perceived credit risk of the issuer. Additionally, in the absence of quoted market prices, these inputs are used by pricing vendors to derive a valuation based upon industry or proprietary models which incorporate issuer specific data with relevant yield/spread comparisons with more widely quoted bonds with similar key characteristics. Those investments for which there are observable inputs are classified as Level 2. Where the inputs are not observable, the investments are classified as Level 3.

The following table summarizes the valuation of the Portfolio’s investments by the above fair value hierarchy levels as of October 31, 2015:

Investments in Securities:	Level 1			Level 2			Level 3			Total
Assets:
Long-Term Municipal Bonds	$	– 0	–	$	27,220,029		$	1,840,984		$	29,061,013
Corporates — Investment Grade		– 0	–		391,720			– 0	–		391,720
Asset-Backed Securities		– 0	–		331,052			– 0	–		331,052
Short-Term Investments		2,385,557			– 0	–		– 0	–		2,385,557
Total Investments in Securities		2,385,557			27,942,801			1,840,984			32,169,342
Other Financial Instruments*:
Assets:
Interest Rate Swaps		– 0	–		1,088			– 0	–		1,088
Liabilities:
Inflation (CPI) Swaps		– 0	–		(240	)		– 0	–		(240	)
Total^	$	2,385,557		$	27,943,649		$	1,840,984		$	32,170,190

* Other financial instruments are derivative instruments, such as futures, forwards and swaps, which are valued at the unrealized appreciation/depreciation on the instrument.

^ There were no transfers between any levels during the reporting period.

The Portfolio recognizes all transfers between levels of the fair value hierarchy assuming the financial instruments were transferred at the beginning of the reporting period.

28 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Notes to Financial Statements

The following is a reconciliation of investments in which significant unobservable inputs (Level 3) were used in determining fair value.

	Long-Term Municipal Bonds			Total
Balance as of 10/31/14	$	1,151,817		$	1,151,817
Accrued discounts/(premiums)		1,068			1,068
Realized gain (loss)		– 0	–		– 0	–
Change in unrealized appreciation/depreciation		10,789			10,789
Purchases		677,310			677,310
Sales		– 0	–		– 0	–
Transfers in to Level 3		– 0	–		– 0	–
Transfers out of Level 3		– 0	–		– 0	–
Balance as of 10/31/15	$	1,840,984		$	1,840,984
Net change in unrealized appreciation/depreciation from investments held as of 10/31/15*	$	10,789		$	10,789

* The unrealized appreciation/depreciation is included in net change in unrealized appreciation/depreciation on investments and other financial instruments in the accompanying statement of operations.

As of October 31, 2015, all Level 3 securities were priced by third party vendors.

The Adviser established the Committee to oversee the pricing and valuation of all securities held in the Portfolio. The Committee operates under pricing and valuation policies and procedures established by the Adviser and approved by the Board, including pricing policies which set forth the mechanisms and processes to be employed on a daily basis to implement these policies and procedures. In particular, the pricing policies describe how to determine market quotations for securities and other instruments. The Committee’s responsibilities include: 1) fair value and liquidity determinations (and oversight of any third parties to whom any responsibility for fair value and liquidity determinations is delegated), and 2) regular monitoring of the Adviser’s pricing and valuation policies and procedures and modification or enhancement of these policies and procedures (or recommendation of the modification of these policies and procedures) as the Committee believes appropriate.

The Committee is also responsible for monitoring the implementation of the pricing policies by the Adviser’s Pricing Group (the “Pricing Group”) and a third party which performs certain pricing functions in accordance with the pricing policies. The Pricing Group is responsible for the oversight of the third party on a day-to-day basis. The Committee and the Pricing Group perform a series of activities to provide reasonable assurance of the accuracy of prices including: 1) periodic vendor due diligence meetings, review of methodologies, new developments and processes at vendors, 2) daily comparison of security valuation versus prior day for all securities that exceeded established thresholds, and 3) daily review of unpriced, stale, and variance reports with exceptions reviewed by senior management and the Committee.

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 29

Notes to Financial Statements

In addition, several processes outside of the pricing process are used to monitor valuation issues including: 1) performance and performance attribution reports are monitored for anomalous impacts based upon benchmark performance, and 2) portfolio managers review all portfolios for performance and analytics (which are generated using the Adviser’s prices).

3. Currency Translation

Assets and liabilities denominated in foreign currencies and commitments under forward currency exchange contracts are translated into U.S. dollars at the mean of the quoted bid and ask prices of such currencies against the U.S. dollar. Purchases and sales of portfolio securities are translated into U.S. dollars at the rates of exchange prevailing when such securities were acquired or sold. Income and expenses are translated into U.S. dollars at rates of exchange prevailing when accrued.

Net realized gain or loss on foreign currency transactions represents foreign exchange gains and losses from sales and maturities of foreign fixed income investments, foreign currency exchange contracts, holding of foreign currencies, currency gains or losses realized between the trade and settlement dates on foreign investment transactions, and the difference between the amounts of dividends, interest and foreign withholding taxes recorded on the Portfolio’s books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized currency gains and losses from valuing foreign currency denominated assets and liabilities at period end exchange rates are reflected as a component of net unrealized appreciation or depreciation of foreign currency denominated assets and liabilities.

4. Taxes

It is the Portfolio’s policy to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its investment company taxable income and net realized gains, if any, to shareholders. Therefore, no provisions for federal income or excise taxes are required. The Portfolio may be subject to taxes imposed by countries in which it invests. Such taxes are generally based on income and/or capital gains earned or repatriated. Taxes are accrued and applied to net investment income, net realized gains and net unrealized appreciation/depreciation as such income and/or gains are earned.

In accordance with U.S. GAAP requirements regarding accounting for uncertainties in income taxes, management has analyzed the Portfolio’s tax positions taken or expected to be taken on federal and state income tax returns for all open tax years (the current and the prior tax year) and has concluded that no provision for income tax is required in the Portfolio’s financial statements.

5. Investment Income and Investment Transactions

Dividend income is recorded on the ex-dividend date or as soon as the Portfolio is informed of the dividend. Interest income is accrued daily. Investment transactions

30 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Notes to Financial Statements

are accounted for on the date the securities are purchased or sold. Investment gains or losses are determined on the identified cost basis. The Portfolio amortizes premiums and accretes discounts as adjustments to interest income.

6. Class Allocations

All income earned and expenses incurred by the Portfolio are borne on a pro-rata basis by each outstanding class of shares, based on the proportionate interest in the Portfolio represented by the net assets of such class, except for class specific expenses which are allocated to the respective class. Expenses of the Fund are charged proportionately to each Portfolio or based on other appropriate methods. Realized and unrealized gains and losses are allocated among the various share classes based on respective net assets.

7. Dividends and Distributions

Dividends and distributions to shareholders, if any, are recorded on the ex-dividend date. Income dividends and capital gains distributions are determined in accordance with federal tax regulations and may differ from those determined in accordance with U.S. GAAP. To the extent these differences are permanent, such amounts are reclassified within the capital accounts based on their federal tax basis treatment; temporary differences do not require such reclassification.

8. Offering Expenses

Offering expenses of $136,907 have been deferred and were amortized on a straight line basis over a one year period starting from December 11, 2013 (commencement of the Portfolio’s operations).

NOTE B

Advisory Fee and Other Transactions with Affiliates

Under the terms of the investment advisory agreement, the Portfolio pays the Adviser a management fee at an annual rate of 0.50% of the Portfolio’s average daily net assets. The Adviser has agreed to waive its fees and bear certain expenses to the extent necessary to limit total operating expenses on an annual basis (the “Expense Caps”) to 0.80% (0.85% prior to January 30, 2015) , 1.55% and 0.55%, of average daily net assets for Class A, Class C and Advisor Class shares, respectively. Any fees waived and expenses borne by the Adviser are subject to repayment by the Portfolio until December 11, 2016. No repayment will be made that would cause the Fund’s total annualized operating expenses to exceed the net fee percentage set forth above or would exceed the amount of offering expenses as recorded by the Fund on or before December 11, 2014. The Expense Caps may not be terminated before January 30, 2016. For the year ended October 31, 2015, such reimbursements/waivers amounted to $298,608.

Pursuant to the investment advisory agreement, the Portfolio may reimburse the Adviser for certain legal and accounting services provided to the Portfolio by the Adviser. For the year ended October 31, 2015, the Adviser voluntarily agreed to waive such fees in the amount of $50,921.

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 31

Notes to Financial Statements

The Portfolio compensates AllianceBernstein Investor Services, Inc. (“ABIS”), a wholly-owned subsidiary of the Adviser, under a Transfer Agency Agreement for providing personnel and facilities to perform transfer agency services for the Portfolio. ABIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. Such compensation retained by ABIS amounted to $18,168 for the year ended October 31, 2015.

AllianceBernstein Investments, Inc. (the “Distributor”), a wholly-owned subsidiary of the Adviser, serves as the distributor of the Portfolio’s shares. The Distributor has advised the Portfolio that it has retained front-end sales charges of $42 from the sale of Class A shares and received $0 and $686 in contingent deferred sales charges imposed upon redemptions by shareholders of Class A and Class C shares, respectively, for the year ended October 31, 2015.

The Portfolio may invest in the AB Fixed-Income Shares, Inc. – Government STIF Portfolio (“Government STIF Portfolio”), an open-end management investment company managed by the Adviser. The Government STIF Portfolio is offered as a cash management option to mutual funds and other institutional accounts of the Adviser, and is not available for direct purchase by members of the public. The Government STIF Portfolio pays no investment management fees but does bear its own expenses. A summary of the Portfolio’s transactions in shares of the Government STIF Portfolio for the year ended October 31, 2015 is as follows:

Market Value October 31, 2014 (000)		Purchases at Cost (000)		Sales Proceeds (000)		Market Value October 31, 2015 (000)		Dividend Income (000)
$	181	$	24,564	$	22,359	$	2,386	$	2

Brokerage commissions paid on investment transactions for the year ended October 31, 2015 amounted to $0, of which $0 and $0, respectively, was paid to Sanford C. Bernstein & Co. LLC and Sanford C. Bernstein Limited, affiliates of the Adviser.

NOTE C

Distribution Services Agreement

The Portfolio has adopted a Distribution Services Agreement (the “Agreement”) pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the Agreement, the Portfolio pays distribution and servicing fees to the Distributor at an annual rate of up to 0.30% of the Portfolio’s average daily net assets attributable to Class A shares and 1% of the Portfolio’s average daily net assets attributable to Class C shares. Effective January 30, 2015, payments under the Agreement in respect of Class A shares are limited to an annual rate of 0.25% of Class A Shares’ average daily net assets. The fees are accrued daily and paid monthly. The Agreement provides that the Distributor will use such payments in

32 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Notes to Financial Statements

their entirety for distribution assistance and promotional activities. Since the commencement of the Portfolio’s operations, the Distributor has incurred expenses in excess of the distribution costs reimbursed by the Portfolio in the amount of $5,127 for Class C shares. While such costs may be recovered from the Portfolio in future periods so long as the Agreement is in effect, the rate of the distribution and servicing fees payable under the Agreement may not be increased without a shareholder vote. In accordance with the Agreement, there is no provision for recovery of unreimbursed distribution costs incurred by the Distributor beyond the current fiscal year for Class A shares. The Agreement also provides that the Adviser may use its own resources to finance the distribution of the Portfolio’s shares.

NOTE D

Investment Transactions

Purchases and sales of investment securities (excluding short-term investments) for the year ended October 31, 2015 were as follows:

	Purchases		Sales
Investment securities (excluding U.S. government securities)	$	20,592,057	$	6,834,855
U.S. government securities		843,227		1,684,477

The cost of investments for federal income tax purposes, gross unrealized appreciation and unrealized depreciation are as follows:

Cost	$	31,353,388
Gross unrealized appreciation	$	866,688
Gross unrealized depreciation		(50,734	)
Net unrealized appreciation	$	815,954

1. Derivative Financial Instruments

The Portfolio may use derivatives in an effort to earn income and enhance returns, to replace more traditional direct investments, to obtain exposure to otherwise inaccessible markets (collectively, “investment purposes”), or to hedge or adjust the risk profile of its portfolio.

The principal types of derivatives utilized by the Portfolio, as well as the methods in which they may be used are:

• Swaps

The Portfolio may enter into swaps to hedge their exposure to interest rates or credit risk. A swap is an agreement that obligates two parties to exchange a series of cash flows at specified intervals based upon or calculated by reference to changes in specified prices or rates for a specified amount of an underlying asset. The payment flows are usually netted against each other, with the difference being paid by one party to the other. In addition, collateral may be pledged or received by the Portfolio

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 33

Notes to Financial Statements

in accordance with the terms of the respective swaps to provide value and recourse to the Portfolio or its counterparties in the event of default, bankruptcy or insolvency by one of the parties to the swap.

Risks may arise as a result of the failure of the counterparty to the swap to comply with the terms of the swap. The loss incurred by the failure of a counterparty is generally limited to the net interim payment to be received by the Portfolio, and/or the termination value at the end of the contract. Therefore, the Portfolio considers the creditworthiness of each counterparty to a swap in evaluating potential counterparty risk. This risk is mitigated by having a netting arrangement between the Portfolio and the counterparty and by the posting of collateral by the counterparty to the Portfolio to cover the Portfolio’s exposure to the counterparty. Additionally, risks may arise from unanticipated movements in interest rates or in the value of the underlying securities. The Portfolio accrues for the interim payments on swaps on a daily basis, with the net amount recorded within unrealized appreciation/depreciation of swaps on the statement of assets and liabilities, where applicable. Once the interim payments are settled in cash, the net amount is recorded as realized gain/(loss) on swaps on the statement of operations, in addition to any realized gain/(loss) recorded upon the termination of swaps. Upfront premiums paid or received in connection with credit default swap contracts are recognized as cost or proceeds on the statement of assets and liabilities and are amortized on a straight line basis over the life of the contract. Amortized upfront premiums are included in net realized gain/(loss) from swaps on the statement of operations. Fluctuations in the value of swaps are recorded as a component of net change in unrealized appreciation/depreciation of swaps on the statement of operations.

Certain standardized swaps, including certain interest rate swaps and credit default swaps, are (or soon will be) subject to mandatory central clearing. Cleared swaps are transacted through futures commission merchants (“FCMs”) that are members of central clearinghouses, with the clearinghouse serving as central counterparty, similar to transactions in futures contracts. Centralized clearing will be required for additional categories of swaps on a phased-in basis based on requirements published by the Securities and Exchange Commission and Commodity Futures Trading Commission.

At the time the Portfolio enters into a centrally cleared swap, the Portfolio deposits and maintains as collateral an initial margin with the broker, as required by the clearinghouse on which the transaction is effected. Such amount is shown as due from broker on the statement of assets and liabilities. Pursuant to the contract, the Portfolio agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments are known as variation margin and are recorded by the Portfolio as unrealized gains or losses. Risks may arise from the potential of a counterparty to meet the terms of

34 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Notes to Financial Statements

the contract. The credit/counterparty risk for centrally cleared swaps is generally less than non-centrally cleared swaps, since the clearinghouse, which is the issuer or counterparty to each centrally cleared swap, has robust risk mitigation standards, including the requirement to provide initial and variation margin. When the contract is closed, the Portfolio records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the time it was closed.

Interest Rate Swaps:

The Portfolio is subject to interest rate risk exposure in the normal course of pursuing its investment objectives. Because the Portfolio holds fixed rate bonds, the value of these bonds may decrease if interest rates rise. To help hedge against this risk and to maintain its ability to generate income at prevailing market rates, the Portfolio may enter into interest rate swaps. Interest rate swaps are agreements between two parties to exchange cash flows based on a notional amount. The Portfolio may elect to pay a fixed rate and receive a floating rate, or, receive a fixed rate and pay a floating rate on a notional amount.

In addition, each Portfolio may also enter into interest rate swap transactions to preserve a return or spread on a particular investment or portion of its portfolio, or protecting against an increase in the price of securities the Portfolio anticipates purchasing at a later date. Interest rate swaps involve the exchange by a Portfolio with another party of their respective commitments to pay or receive interest (e.g., an exchange of floating rate payments for fixed rate payments) computed based on a contractually-based principal (or “notional”) amount. Interest rate swaps are entered into on a net basis (i.e., the two payment streams are netted out, with the Portfolio receiving or paying, as the case may be, only the net amount of the two payments).

During the year ended October 31, 2015, the Portfolio held interest rate swaps for hedging purposes.

Inflation (CPI) Swaps:

Inflation swaps are contracts in which one party agrees to pay the cumulative percentage increase in a price index (the Consumer Price Index with respect to CPI swaps) over the term of the swap (with some lag on the inflation index), and the other pays a compounded fixed rate. Inflation swaps may be used to protect the net asset value, or NAV, of the Portfolio against an unexpected change in the rate of inflation measured by an inflation index since the value of these agreements is expected to increase if unexpected inflation increases.

During the year ended October 31, 2015, the Portfolio held inflation (CPI) swaps for hedging purposes.

The Portfolio typically enters into International Swaps and Derivatives Association, Inc. Master Agreements (“ISDA Master Agreement”) or similar master

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 35

Notes to Financial Statements

agreements (collectively, “Master Agreements”) with its derivative contract counterparties in order to, among other things, reduce its credit risk to counterparties. ISDA Master Agreements include provisions for general obligations, representations, collateral and events of default or termination. Under an ISDA Master Agreement, the Portfolio typically may offset with the counterparty certain derivative financial instrument’s payables and/or receivables with collateral held and/or posted and create one single net payment (close-out netting) in the event of default or termination.

Various Master Agreements govern the terms of certain transactions with counterparties, including transactions such as derivative transactions, repurchase and reverse repurchase agreements. These Master Agreements typically attempt to reduce the counterparty risk associated with such transactions by specifying credit protection mechanisms and providing standardization that improves legal certainty. Cross-termination provisions under Master Agreements typically provide that a default in connection with one transaction between the Portfolio and a counterparty gives the non-defaulting party the right to terminate any other transactions in place with the defaulting party to create one single net payment due to/due from the defaulting party. In the event of a default by a Master Agreements counterparty, the return of collateral with market value in excess of the Portfolio’s net liability, held by the defaulting party, may be delayed or denied.

At October 31, 2015, the Portfolio had entered into the following derivatives:

	Asset Derivatives			Liability Derivatives
Derivative Type	Statement of Assets and Liabilities Location	Fair Value		Statement of Assets and Liabilities Location	Fair Value
Interest rate contracts	Unrealized appreciation on interest rate swaps	$	1,088
Interest rate contracts				Unrealized depreciation on inflation swaps	$	240
Total		$	1,088		$	240

The effect of derivative instruments on the statement of operations for the year ended October 31, 2015:

Derivative Type	Location of Gain or (Loss) on Derivatives	Realized Gain or (Loss) on Derivatives			Change in Unrealized Appreciation or (Depreciation)
Interest rate contracts	Net realized gain (loss) on swaps; Net change in unrealized appreciation/depreciation of swaps	$	– 0	–	$	848
Total		$	– 0	–	$	848

36 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Notes to Financial Statements

The following table represents the average monthly volume of the Portfolio’s derivative transactions during the year ended October 31, 2015:

Interest Rate Swaps:
Average notional amount	$	500,000	(a)
Inflation Swaps:
Average notional amount	$	300,000	(b)

^(a)  Positions were open for less than one month during the year.

^(b)  Positions were open for two months during the year.

For financial reporting purposes, the Portfolio does not offset derivative assets and derivative liabilities that are subject to netting arrangements in the statement of assets and liabilities.

All derivatives held at period end were subject to netting arrangements. The following table presents the Portfolio’s derivative assets and liabilities by counterparty net of amounts available for offset under Master Agreements (“MA”) and net of the related collateral received/ pledged by the Portfolio as of October 31, 2015:

Counterparty	Derivative Assets Subject to a MA		Derivative Available for Offset			Cash Collateral Received			Security Collateral Received			Net Amount of Derivatives Assets
OTC Derivatives:
Citibank, NA	$	1,088	$	(159	)	$	– 0	–	$	– 0	–	$	929
Total	$	1,088	$	(159	)	$	– 0	–	$	– 0	–	$	929	^
Counterparty	Derivative Liabilities Subject to a MA		Derivative Available for Offset			Cash Collateral Pledged			Security Collateral Pledged			Net Amount of Derivatives Liabilities
OTC Derivatives:
Bank of America, NA	$	81	$	– 0	–	$	– 0	–	$	– 0	–	$	81
Citibank, NA		159		(159	)		– 0	–		– 0	–		– 0	–
Total	$	240	$	(159	)	$	– 0	–	$	– 0	–	$	81	^

^ Net amount represents the net receivable/payable that would be due from/to the counterparty in the event of default or termination. The net amount from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same counterparty.

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 37

Notes to Financial Statements

NOTE E

Capital Stock

Each class consists of 3,000,000,000 authorized shares. Transactions in capital shares for each class were as follows:

	Shares						Amount
	Year Ended October 31, 2015			December 11, 2013(a) to October 31, 2014			Year Ended October 31, 2015			December 11, 2013(a) to October 31, 2014
Class A
Shares sold		282,686			186,230		$	2,977,235		$	1,934,806
Shares issued in reinvestment of dividends and distributions		1,770			153			18,635			1,594
Shares redeemed		(18,562	)		(492	)		(194,825	)		(5,039	)
Net increase		265,894			185,891		$	2,801,045		$	1,931,361
Class C
Shares sold		142,063			35,246		$	1,504,726		$	365,925
Shares issued in reinvestment of dividends and distributions		840			22			8,846			240
Shares redeemed		(34,616	)		(224	)		(365,493	)		(2,321	)
Net increase		108,287			35,044		$	1,148,079		$	363,844
Advisor Class
Shares sold		1,829,437			1,564,205		$	19,266,170		$	15,850,833
Shares issued in reinvestment of dividends and distributions		16,538			3,466			174,157			36,046
Shares redeemed		(745,995	)		(180,816	)		(7,831,996	)		(1,885,432	)
Net increase		1,099,980			1,386,855		$	11,608,331		$	14,001,447

^(a)  Commencement of operations.

NOTE F

Risks Involved in Investing in the Portfolio

Credit Risk—An issuer or guarantor of a fixed-income security, or the counterparty to a derivatives or other contract, may be unable or unwilling to make timely payments of interest or principal, or to otherwise honor its obligations. The issuer or guarantor may default, causing a loss of the full principal amount of a security. The degree of risk for a particular security may be reflected in its credit rating. There is the possibility that the credit rating of a fixed-income security may be downgraded after purchase, which may adversely affect the value of the security.

38 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Notes to Financial Statements

Below Investment Grade Securities—Investments in fixed-income securities with lower ratings are subject to a higher probability that an issuer will default or fail to meet its payment obligations. These securities may be subject to greater price volatility due to such factors as specific corporate developments, interest rate sensitivity, negative performance of the junk bond market generally and less secondary market liquidity.

Municipal Market Risk—This is the risk that special factors may adversely affect the value of municipal securities and have a significant effect on the yield or value of the Portfolio’s investments in municipal securities. These factors include economic conditions, political or legislative changes, uncertainties related to the tax status of municipal securities, or the rights of investors in these securities. To the extent that the Portfolio invests more of its assets in a particular state’s municipal securities, the Portfolio’s may be vulnerable to events adversely affecting that state, including economic, political and regulatory occurrences, court decisions, terrorism and catastrophic natural disasters, such as hurricanes or earthquakes. The Portfolio’s investments in certain municipal securities with principal and interest payments that are made from the revenues of a specific project or facility, and not general tax revenues, may have increased risks. Factors affecting the project or facility, such as local business or economic conditions, could have a significant effect on the project’s ability to make payments of principal and interest on these securities.

The Portfolio may invest in municipal securities of issuers in Puerto Rico or other U.S. territories, which are exempt from federal, state, and, where applicable, local income taxes. These municipal securities may have more risks than those of most other U.S. issuers of tax-exempt securities. Like many U.S. states and municipalities, Puerto Rico experienced a significant downturn during the recent recession. Puerto Rico’s downturn was particularly severe, and it continues to face a very challenging economic and fiscal environment. As a result, securities issued by many Puerto Rican issuers have low credit ratings or are on “negative watch” by credit rating organizations, and markets in such securities have been volatile. If the economic situation in Puerto Rico persists or worsens, the volatility and credit quality of Puerto Rican municipal securities could be adversely affected, and the market for such securities may experience continued volatility.

Tax Risk—From time to time, the U.S. Government and the U.S. Congress consider changes in federal tax law that could limit or eliminate the federal tax exemption for municipal bond income, which would in effect reduce the net income received by shareholders from the Portfolio by increasing taxes on that income. In such event, the Portfolio’s NAV could also decline as yields on municipal bonds, which are typically lower than those on taxable bonds, would be expected to increase to approximately the yield of comparable taxable bonds. Actions or anticipated actions affecting the tax exempt status of municipal bonds could also result in significant shareholder redemptions of Portfolio shares as investors anticipate adverse effects on the Portfolio or seek higher yields to offset

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 39

Notes to Financial Statements

the potential loss of the tax deduction. As a result, the Portfolio would be required to maintain higher levels of cash to meet the redemptions, which would negatively affect the Portfolio’s yield.

Interest Rate Risk—Changes in interest rates will affect the value of investments in fixed-income securities. When interest rates rise, the value of investments in fixed-income securities tends to fall and this decrease in value may not be offset by higher income from new investments. The Portfolio may be subject to a heightened risk of rising interest rates as the current period of historically low rates is expected to end, and rates are expected to begin rising in the near future. Interest rate risk is generally greater for fixed-income securities with longer maturities or durations.

Duration Risk—Duration is the measure that relates the expected price volatility of a fixed-income security to changes in interest rates. The duration of a fixed-income security may be shorter than or equal to full maturity of a fixed-income security. Fixed-income securities with longer durations have more risk and will decrease in price as interest rates rise. For example, a fixed-income security with a duration of three years will decrease in value by approximately 3% if interest rates increase by 1%.

Inflation Risk—This is the risk that the value of assets or income from investments will be less in the future as inflation decreases the value of money. As inflation increases, the value of the Portfolio’s assets can decline as can the value of the Portfolio’s distributions. This risk is significantly greater for fixed-income securities with longer maturities.

Liquidity Risk—Liquidity risk exists when particular investments are difficult to purchase or sell, possibly preventing the Portfolio from selling out of these securities at an advantageous price. Derivatives and securities involving substantial market and credit risk tend to involve greater liquidity risk. The Portfolio is subject to liquidity risk because the market for municipal securities is generally smaller than many other markets.

Derivatives Risk—The Portfolio may enter into derivative transactions such as forwards, options, futures and swaps. Derivatives may be illiquid, difficult to price, and leveraged so that small changes may produce disproportionate losses for the Portfolio, and subject to counterparty risk to a greater degree than more traditional investments. Derivatives may result in significant losses, including losses that are far greater than the value of the derivatives reflected on the statement of assets and liabilities.

Indemnification Risk—In the ordinary course of business, the Portfolio enters into contracts that contain a variety of indemnifications. The Portfolio’s maximum exposure under these arrangements is unknown. However, the Portfolio has not had prior claims or losses pursuant to these indemnification provisions

40 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Notes to Financial Statements

and expects the risk of loss thereunder to be remote. Therefore, the Portfolio has not accrued any liability in connection with these indemnification provisions.

NOTE G

Joint Credit Facility

A number of open-end mutual funds managed by the Adviser, including the Portfolio, participate in a $280 million revolving credit facility (the “Facility”) intended to provide short-term financing, if necessary, subject to certain restrictions in connection with abnormal redemption activity. Commitment fees related to the Facility are paid by the participating funds and are included in miscellaneous expenses in the statement of operations. The Portfolio did not utilize the Facility during the year ended October 31, 2015.

NOTE H

Distributions to Shareholders

The tax character of distributions paid during the fiscal years ended October 31, 2015 and October 31, 2014 were as follows:

	2015		2014
Distributions paid from:
Ordinary income	$	42,656	$	5,493
Total taxable distributions		42,656		5,493
Tax exempt distributions		468,917		197,785
Total distributions paid	$	511,573	$	203,278

As of October 31, 2015, the components of accumulated earnings/(deficit) on a tax basis were as follows:

Undistributed tax-exempt income	$	32,036
Accumulated capital and other losses		(40,872	)(a)
Unrealized appreciation/(depreciation)		816,986	(b)
Total accumulated earnings/(deficit)	$	808,150	(c)

^(a)  As of October 31, 2015, the Portfolio had a net capital loss carryforward of $40,872.

^(b)  The difference between book-basis and tax-basis unrealized appreciation/(depreciation) is attributable primarily to the tax treatment of swaps.

^(c)  The difference between book-basis and tax-basis components of accumulated earnings/(deficit) is attributable primarily to dividends payable.

For tax purposes, net capital losses may be carried over to offset future capital gains, if any. Funds are permitted to carry forward capital losses incurred in taxable years beginning after December 22, 2010 for an indefinite period, and such losses will retain their character as either short-term or long-term capital losses. As of October 31, 2015, the Portfolio had a net short-term capital loss carryforward of $40,872 which may be carried forward for an indefinite period.

During the current fiscal year, permanent differences primarily due to the tax treatment of offering costs, a redesignation of dividends, and the tax treatment

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 41

Notes to Financial Statements

of Treasury inflation-protected securities resulted in a net increase in undistributed net investment income, a net increase in accumulated net realized loss on investment transactions, and a net decrease in additional paid-in capital. These reclassifications had no effect on net assets.

NOTE I

New Accounting Pronouncement

In May 2015, the Financial Accounting Standards Board issued an Accounting Standards Update (“ASU”), ASU 2015-07, which removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the net asset value per share practical expedient. The ASU also removes the disclosure requirement for investments not valued at net asset value. The ASU is effective for annual periods beginning after December 15, 2015 and interim periods within those annual periods. At this time, management is evaluating the implications of these changes on the financial statements.

NOTE J

Subsequent Event

Management has evaluated subsequent events for possible recognition or disclosure in the financial statements through the date the financial statements are issued. Management has determined that there are no material events that would require disclosure in the Portfolio’s financial statements through this date.

42 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Notes to Financial Statements

FINANCIAL HIGHLIGHTS

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class A
	Year Ended October 31, 2015			December 11, 2013(a) to October 31, 2014
Net asset value, beginning of period		$  10.51			$  10.00
Income From Investment Operations
Net investment income(b)(c)		.18			.14
Net realized and unrealized gain on investment transactions		.09			.50
Net increase in net asset value from operations		.27			.64
Less: Dividends and Distributions
Dividends from net investment income		(.18	)		(.13	)
Distributions from net realized gain on investment transactions		(.01	)		– 0	–
Total dividends and distributions		(.19	)		(.13	)
Net asset value, end of period		$  10.59			$  10.51
Total Return
Total investment return based on net asset value(d)		2.64	%		6.44	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$4,783			$1,954
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.81	%		.85	%^
Expenses, before waivers/reimbursements		2.19	%		3.59	%^
Net investment income(c)		1.75	%		1.57	%^
Portfolio turnover rate		35	%		42	%

See footnote summary on page 45.

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 43

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Class C
	Year Ended October 31, 2015			December 11, 2013(a) to October 31, 2014
Net asset value, beginning of period		$  10.52			$  10.00
Income From Investment Operations
Net investment income(b)(c)		.10			.07
Net realized and unrealized gain on investment transactions		.09			.52
Net increase in net asset value from operations		.19			.59
Less: Dividends and Distributions
Dividends from net investment income		(.11	)		(.07	)
Distributions from net realized gain on investment transactions		(.01	)		– 0	–
Total dividends and distributions		(.12	)		(.07	)
Net asset value, end of period		$  10.59			$  10.52
Total Return
Total investment return based on net asset value(d)		1.78	%		5.92	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$1,518			$369
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		1.55	%		1.55	%^
Expenses, before waivers/reimbursements		2.85	%		4.33	%^
Net investment income(c)		.99	%		.82	%^
Portfolio turnover rate		35	%		42	%

See footnote summary on page 45.

44 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Financial Highlights

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

	Advisor Class
	Year Ended October 31, 2015			December 11, 2013(a) to October 31, 2014
Net asset value, beginning of period		$  10.52			$  10.00
Income From Investment Operations
Net investment income(b)(c)		.21			.16
Net realized and unrealized gain on investment transactions		.08			.52
Net increase in net asset value from operations		.29			.68
Less: Dividends and Distributions
Dividends from net investment income		(.21	)		(.16	)
Distributions from net realized gain on investment transactions		(.01	)		– 0	–
Total dividends and distributions		(.22	)		(.16	)
Net asset value, end of period		$  10.59			$  10.52
Total Return
Total investment return based on net asset value(d)		2.81	%		6.84	%
Ratios/Supplemental Data
Net assets, end of period (000’s omitted)		$26,333			$14,584
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.55	%		.55	%^
Expenses, before waivers/reimbursements		1.92	%		3.82	%^
Net investment income(c)		1.99	%		1.76	%^
Portfolio turnover rate		35	%		42	%

(a) Commencement of operations.

(b) Based on average shares outstanding.

(c) Net of fees and expenses waived/reimbursed by the Adviser.

(d) Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Initial sales charges or contingent deferred sales charges are not reflected in the calculation of total investment return. Total return does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Total investment return calculated for a period of less than one year is not annualized.

^ Annualized.

See notes to financial statements.

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 45

Financial Highlights

REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

To the Board of Directors and

Shareholders of AB Tax-Aware Fixed Income Portfolio

We have audited the accompanying statement of assets and liabilities, including the portfolio of investments, of AB Tax-Aware Fixed Income Portfolio (the “Fund”) (formerly AllianceBernstein Tax-Aware Fixed Income Portfolio), one of the portfolios constituting AB Bond Fund, Inc. (formerly AllianceBernstein Bond Fund, Inc.), as of October 31, 2015, and the related statement of operations for the year then ended, and the statements of changes in net assets and the financial highlights for the year then ended and for the period December 11, 2013 (commencement of operations) through October 31, 2014. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Fund’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of October 31, 2015, by correspondence with the custodian and others, or by other appropriate auditing procedures where replies from others were not received. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the AB Tax-Aware Fixed Income Portfolio, one of the portfolios constituting the AB Bond Fund, Inc., at October 31, 2015, the results of its operations for the year then ended, and the changes in its net assets and financial highlights for the year then ended and for the period December 11, 2013 (commencement of operations) through October 31, 2014, in conformity with U.S. generally accepted accounting principles.

New York, New York

December 30, 2015

46 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Report of Independent Registered Public Accounting Firm

2015 FEDERAL TAX INFORMATION

(unaudited)

For Federal income tax purposes, the following information is furnished with respect to the distributions paid by the Portfolio during the taxable year ended October 31, 2015. For foreign shareholders, 47.25% of ordinary dividends paid may be considered to be qualifying to be taxed as interest-related dividends.

Shareholders should not use the above information to prepare their income tax returns. The information necessary to complete your income tax returns will be included with your Form 1099-DIV which will be sent to you separately in January 2016.

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 47

BOARD OF DIRECTORS

Marshall C. Turner, Jr.⁽¹⁾, Chairman John H. Dobkin⁽¹⁾ Michael J. Downey⁽¹⁾ William H. Foulk, Jr.⁽¹⁾ D. James Guzy⁽¹⁾ Nancy P. Jacklin⁽¹⁾ Robert M. Keith, President and Chief Executive Officer Garry L. Moody⁽¹⁾ Earl D. Weiner⁽¹⁾

OFFICERS

Philip L. Kirstein, Senior Vice President and Independent Compliance Officer Robert “Guy” B. Davidson III⁽²⁾, Vice President Jon P. Denfeld⁽²⁾, Vice President Terrance T. Hults⁽²⁾, Vice President Shawn E. Keegan⁽²⁾, Vice President Emilie D. Wrapp, Secretary Joseph J. Mantineo, Treasurer and Chief Financial Officer Phyllis J. Clarke, Controller Vincent S. Noto, Chief Compliance Officer

Custodian and Accounting Agent State Street Bank and Trust Company State Street Corporation CCB/5 1 Iron Street Boston, MA 02210   Principal Underwriter AllianceBernstein Investments, Inc. 1345 Avenue of the Americas New York, NY 10105   Transfer Agent AllianceBernstein Investor Services, Inc. P.O. Box 786003 San Antonio, TX 78278-6003 Toll-Free (800) 221-5672 Independent Registered Public Accounting Firm Ernst & Young LLP 5 Times Square New York, NY 10036   Legal Counsel Seward & Kissel LLP One Battery Park Plaza New York, NY 10004

(1) Member of the Audit Committee, the Governance and Nominating Committee and the Independent Directors Committee.

(2) The day-to-day management of, and investment decisions for, the Fund are made by its senior investment management team. Messrs. Davidson, Denfeld, Hults and Keegan are the investment professionals with the most significant responsibility for the day-to-day management of the Fund’s portfolio.

48 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Board of Directors

MANAGEMENT OF THE FUND

Board of Directors Information

The business and affairs of the Fund are managed under the direction of the Board of Directors. Certain information concerning the Fund’s Directors is set forth below.

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
INTERESTED DIRECTOR
Robert M. Keith, # 1345 Avenue of the Americas New York, NY 10105 55 (2013)	Senior Vice President of AllianceBernstein L.P. (the “Adviser”) and the head of AllianceBernstein Investments, Inc. (“ABI”) since July 2008; Director of ABI and President of the AB Mutual Funds. Previously, he served as Executive Managing Director of ABI from December 2006 to June 2008. Prior to joining ABI in 2006, Executive Managing Director of Bernstein Global Wealth Management, and prior thereto, Senior Managing Director and Global Head of Client Service and Sales of the Adviser’s institutional investment management business since 2004. Prior thereto, he was Managing Director and Head of North American Client Service and Sales in the Adviser’s institutional investment management business, with which he had been associated since prior to 2004.		110	None

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 49

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS
Marshall C. Turner, Jr., ## Chairman of the Board 74 (2013)	Private Investor since prior to 2010. Former Chairman and CEO of Dupont Photomasks, Inc. (components of semi-conductor manufacturing). He has extensive operating leadership and venture capital investing experience, including five interim or full-time CEO roles, and prior service as general partner of institutional venture capital partnerships. He also has extensive non-profit board leadership experience, and currently serves on the boards of two education and science-related non-profit organizations. He has served as a director of one AB fund since 1992, and director or trustee of multiple AB Funds since 2005. He has been Chairman of the AB Funds since January 2014, and the Chairman of the Independent Directors Committees of such Funds since February 2014.		110	Xilinx, Inc. (programmable logic semi-conductors) since 2007
John H. Dobkin, ## 73 (2013)	Independent Consultant since prior to 2010. Formerly, President of Save Venice, Inc. (preservation organization) from 2001-2002; Senior Advisor from June 1999-June 2000 and President of Historic Hudson Valley (historic preservation) from December 1989-May 1999. Previously, Director of the National Academy of Design. He has served as a director or trustee of various AB Funds since 1992, and as Chairman of the Audit Committees of a number of such Funds from 2001-2008.		110	None

50 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
Michael J. Downey, ## 71 (2013)	Private Investor since prior to 2010. Formerly, managing partner of Lexington Capital, LLC (investment advisory firm) from December 1997 until December 2003. He was a Director of The Merger Fund (registered investment company) since prior to 2010 until 2013. He served as a Director of Prospect Acquisition Corp. (financial services) from 2007 until 2009. From 1987 until 1993, Chairman and CEO of Prudential Mutual Fund Management, director of the Prudential mutual funds, and member of the Executive Committee of Prudential Securities Inc. He has served as a director or trustee of the AB Funds since 2005 and is a director and Chairman of one other registered investment company.		110	Asia Pacific Fund, Inc. (registered investment company) since prior to 2010
William H. Foulk, Jr., ## 83 (2013)	Investment Adviser and an Independent Consultant since prior to 2010. Previously, he was Senior Manager of Barrett Associates, Inc., a registered investment adviser. He was formerly Deputy Comptroller and Chief Investment Officer of the State of New York and, prior thereto, Chief Investment Officer of the New York Bank for Savings. He has served as a director or trustee of various AB Funds since 1983, and was Chairman of the Independent Directors Committees of the AB Funds from 2003 until early February 2014. He served as Chairman of such Funds from 2003 through December 2013. He is also active in a number of mutual fund related organizations and committees.		110	None

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 51

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
D. James Guzy, ## 79 (2013)	Chairman of the Board of SRC Computers, Inc. (semi-conductors), with which he has been associated since prior to 2010. He served as Chairman of the Board of PLX Technology (semi-conductors) since prior to 2010 until November 2013. He was a Director of Cirrus Logic Corporation (semi-conductors) from 1984 until July 2011. He was a director of Intel Corporation (semi-conductors) from 1969 until 2008, and served as Chairman of the Finance Committee of such company for several years until May 2008. He has served as a director or trustee of one or more of the AB Funds since 1982.		110	None
Nancy P. Jacklin, ## 67 (2013)	Professorial Lecturer at the Johns Hopkins School of Advanced International Studies (2008-2015). U.S. Executive Director of the International Monetary Fund (which is responsible for ensuring the stability of the international monetary system), (December 2002-May 2006); Partner, Clifford Chance (1992-2002); Sector Counsel, International Banking and Finance, and Associate General Counsel, Citicorp (1985-1992); Assistant General Counsel (International), Federal Reserve Board of Governors (1982-1985); and Attorney Advisor, U.S. Department of the Treasury (1973-1982). Member of the Bar of the District of Columbia and of New York; and member of the Council on Foreign Relations. She has served as a director or trustee of the AB Funds since 2006 and has been Chairman of the Governance and Nominating Committees of the AB Funds since August 2014.		110	None

52 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
Garry L. Moody, ## 63 (2013)	Independent Consultant. Formerly, Partner, Deloitte & Touche LLP (1995-2008) where he held a number of senior positions, including Vice Chairman, and U.S. and Global Investment Management Practice Managing Partner; President, Fidelity Accounting and Custody Services Company (1993-1995); and Partner, Ernst & Young LLP (1975-1993), where he served as the National Director of Mutual Fund Tax Services and Managing Partner of its Chicago Office Tax department. He is a member of the Trustee Advisory Board of BoardIQ, a biweekly publication focused on issues and news affecting directors of mutual funds. He has served as a director or trustee, and as Chairman of the Audit Committees, of the AB Funds since 2008.		110	None
Earl D. Weiner, ## 76 (2013)	Of Counsel, and Partner prior to January 2007, of the law firm Sullivan & Cromwell LLP and is a former member of the ABA Federal Regulation of Securities Committee Task Force to draft editions of the Fund Director’s Guidebook. He also serves as a director or trustee of various non-profit organizations and has served as Chairman or Vice Chairman of a number of them. He has served as a director or trustee of the AB Funds since 2007 and served as Chairman of the Governance and Nominating Committees of the AB Funds from 2007 until August 2014.		110	None

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 53

Management of the Fund

* The address for each of the Fund’s disinterested Directors is c/o AllianceBernstein L.P., Attention: Philip L. Kirstein, 1345 Avenue of the Americas, New York, NY 10105.

** There is no stated term of office for the Fund’s Directors.

*** The information above includes each Director’s principal occupation during the last five years and other information relating to the experience, attributes and skills relevant to each Director’s qualifications to serve as a Director, which led to the conclusion that each Director should serve as a Director for the Fund.

# Mr. Keith is an “interested person” of the Fund, as defined in the 1940 Act, due to his position as a Senior Vice President of the Adviser.

## Member of the Audit Committee, the Governance and Nominating Committee and the Independent Directors Committee.

54 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Management of the Fund

Officer Information

Certain information concerning the Fund’s Officers is listed below.

NAME, ADDRESS* AND AGE	POSITION(S) HELD WITH FUND	PRINCIPAL OCCUPATION DURING PAST 5 YEARS
Robert M. Keith 55	President and Chief Executive Officer	See biography above.
Philip L. Kirstein 70	Senior Vice President and Independent Compliance Officer	Senior Vice President and Independent Compliance Officer of the AB Funds, with which he has been associated since October 2004. Prior thereto, he was Of Counsel to Kirkpatrick & Lockhart, LLP from October 2003 to October 2004, and General Counsel of Merrill Lynch Investment Managers, L.P. since prior to March 2003.
Robert “Guy” B. Davidson, III 54	Vice President	Senior Vice President of the Adviser,** with which he has been associated since prior to 2010.
Jon P. Denfeld 45	Vice President	Vice President of the Adviser,** with which he has been associated since prior to 2010.
Terrance T. Hults 49	Vice President	Senior Vice President of the Adviser,** with which he has been associated since prior to 2010.
Shawn E. Keegan 44	Vice President	Senior Vice President of the Adviser,** with which he has been associated since prior to 2010.
Emilie D. Wrapp 59	Secretary	Senior Vice President, Assistant General Counsel and Assistant Secretary of ABI,** with which she has been associated since prior to 2010.
Joseph J. Mantineo 56	Treasurer and Chief Financial Officer	Senior Vice President of AllianceBernstein Investor Services, Inc. (“ABIS”),** with which he has been associated since prior to 2010.
Phyllis J. Clarke 54	Controller	Vice President of ABIS,** with which she has been associated since prior to 2010.
Vincent S. Noto 51	Chief Compliance Officer	Senior Vice President since 2015 and Mutual Fund Chief Compliance Officer of the Adviser** since 2014. Prior thereto, he was Vice President and Director of Mutual Fund Compliance of the Adviser** since prior to 2010.

* The address for the Fund’s Officers is 1345 Avenue of the Americas, New York, NY 10105.

** The Adviser, ABI and ABIS are affiliates of the Fund.

The Fund’s Statement of Additional Information (“SAI”) has additional information about the Fund’s Directors and Officers and is available without charge upon request. Contact your financial representative or AB at 1-800-227-4618, or visit www.ABglobal.com, for a free prospectus of SAI.

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 55

Management of the Fund

THE FOLLOWING IS NOT PART OF THE SHAREHOLDER REPORT OR THE FINANCIAL STATEMENTS

SUMMARY OF SENIOR OFFICER’S EVALUATION OF INVESTMENT ADVISORY AGREEMENT¹

The following is a summary of the evaluation of the Investment Advisory Agreement between AllianceBernstein L.P. (the “Adviser”) and AB Bond Fund, Inc. (the “Fund”), in respect of AB Tax-Aware Fixed Income Portfolio (the “Portfolio”),² prepared by Philip L. Kirstein, the Senior Officer of the Fund for the Directors of the Fund, as required by the August 2004 agreement between the Adviser and the New York State Attorney General (the “NYAG”). The Senior Officer’s evaluation of the Investment Advisory Agreement is not meant to diminish the responsibility or authority of the Board of Directors of the Fund to perform its duties pursuant to Section 15 of the Investment Company Act of 1940 (the “40 Act”) and applicable state law. The purpose of the summary is to provide shareholders with a synopsis of the independent evaluation of the reasonableness of the advisory fees proposed to be paid by the Portfolio which was provided to the Directors in connection with their review of the proposed approval of the continuance of the Investment Advisory Agreement.

The Senior Officer’s evaluation considered the following factors:

1. Advisory fees charged to institutional and other clients of the Adviser for like services;

2. Advisory fees charged by other mutual fund companies for like services;

3. Costs to the Adviser and its affiliates of supplying services pursuant to the advisory agreement, excluding any intra-corporate profit;

4. Profit margins of the Adviser and its affiliates from supplying such services;

5. Possible economies of scale as the Portfolio grows larger; and

6. Nature and quality of the Adviser’s services including the performance of the Portfolio.

These factors, with the exception of the first factor, are generally referred to as the “Gartenberg factors,” which were articulated by the United States Court of Appeals for the Second Circuit in 1982. Gartenberg v. Merrill Lynch Asset Management, Inc., 694 F. 2d 923 (2d Cir. 1982). On March 30, 2010, the Supreme Court held the Gartenberg decision was correct in its basic formulation of what Section 36(b) requires: to face liability under Section 36(b), “an investment

1 The information in the fee evaluation was completed on October 22, 2015 and discussed with the Board of Directors on November 3-5, 2015.

2 Future references to the Portfolio do not include “AB.”

56 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

adviser must charge a fee that is so disproportionately large that it bears no reasonable relationship to the services rendered and could not have been the product of arm’s length bargaining.” Jones v. Harris Associates L.P., 130 S. Ct. 1418 (2010). In the Jones decision, the Court stated the Gartenberg approach fully incorporates the correct understanding of fiduciary duty within the context of Section 36(b) and noted with approval that “Gartenberg insists that all relevant circumstances be taken into account” and “uses the range of fees that might result from arm’s length bargaining as the benchmark for reviewing challenged fees.”³

ADVISORY FEES, NET ASSETS, & EXPENSE RATIOS

The Adviser proposed that the Portfolio pays the advisory fee set forth below for receiving the services to be provided pursuant to the Investment Advisory Agreement. Also shown are the Fund’s net assets on September 30, 2015.

Portfolio	Net Assets 9/30/15 ($MM)	Advisory Fee Schedule Based on the Average Daily Net Assets of the Portfolio
Tax-Aware Fixed Income Portfolio4	$31.3	0.50% of average daily net assets

The Portfolio’s Investment Advisory Agreement provides for the Adviser to be reimbursed for certain clerical, legal, accounting, administrative and other services provided to the Fund. During the Portfolio’s fiscal year ended October 31, 2014, the Adviser was entitled to receive $56,885 (0.434% of the Portfolio’s average daily net assets) for providing such services but waived the amount in its entirety.

The Adviser has agreed to waive that portion of its management fees and/or reimburse the Portfolio for that portion of the Portfolio’s total operating expenses to the degree necessary to limit the Portfolio’s expense ratio to the amounts set forth below for the Portfolio’s current fiscal year. The waiver is terminable by the Adviser at the end of the Portfolio’s fiscal year upon at least

3 Jones v. Harris at 1427.

4 The advisory fee schedule for the Portfolio has a higher effective fee rate than the advisory fee schedule of the Low Risk and High Income categories, in which the Portfolio would have been categorized had the Adviser implemented the NYAG related fee schedule. The advisory fee schedules for the Low Risk and High Income categories are as follows: 0.45% on the first $2.5 billion, 0.40% on the next $2.5 billion, 0.35% on the balance for the Low Income category and 0.50% on the first $2.5 billion, 0.45% on the next $2.5 billion and 0.40% on the balance for the High Income category.

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 57

60 days’ notice prior to the Portfolio’s prospectus update. In addition, set forth below are the Portfolio’s gross expense ratios for the most recent semi-annual period:⁵

Portfolio	Expense Cap Pursuant to Expense Limitation Undertaking			Gross Expense Ratio6			Fiscal Year End
Tax-Aware Fixed Income Portfolio7,8	Advisor Class A Class C	0.55 0.80 1.55	%  %  %		2.13 2.42 3.00	%  %  %	October 31 (ratios as of March 30, 2015)

I. ADVISORY FEES CHARGED TO INSTITUTIONAL AND OTHER CLIENTS

The advisory fees charged to investment companies which the Adviser manages and sponsors are normally higher than those charged to similar sized institutional accounts, including pension plans and sub-advised investment companies. The fee differential reflects, among other things, different services provided to such clients, and different liabilities assumed. Services provided by the Adviser to the Portfolio that are not provided to non-investment company clients and sub-advised investment companies include providing office space and personnel to serve as Fund Officers, who among other responsibilities, make the certifications required under the Sarbanes–Oxley Act of 2002, and coordinating with and monitoring the Portfolio’s third party service providers such as Fund counsel, auditors, custodians, transfer agents and pricing services. The accounting, administrative, legal and compliance requirements for the Portfolio are more costly than those for institutional assets due to the greater complexities and time required for investment companies, although the Adviser is entitled to be reimbursed for providing such services. Managing the cash flow of an investment company is more difficult than that of a stable pool of assets, such as an institutional account with little cash movement in either direction, particularly if a fund is in net redemption, and the Adviser is frequently forced to sell securities to raise cash for redemptions. However, managing a fund with positive cash flow may be easier at times than managing a stable pool of assets. In recent years, investment advisers have been sued by institutional clients and have suffered reputational damage both by the attendant publicity and outcomes other than complete victories. Accordingly, the legal and reputational risks associated with institutional accounts are greater than previously thought, although still not equal to those related to the mutual fund industry.

5 Semi-annual total expense ratios are unaudited.

6 Annualized.

7 Effective January 30, 2015, the Rule 12b-1 fee for Class A shares of the Portfolio was reduced from 0.30% to 0.25%. At the same time, the expense cap for the Class A shares was also reduced from 0.85% to 0.80%.

8 The net expense ratio for Class A shares of the Portfolio during the semi-annual period ended March 31, 2015 was 0.82%.

58 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

Notwithstanding the Adviser’s view that managing an investment company is not comparable to managing other institutional accounts because the services provided are different, the Supreme Court has indicated consideration should be given to the advisory fees charged to institutional accounts with a similar investment style as the Portfolio.⁹ However, the Adviser has represented that there is no category in the Form ADV for institutional products that have a substantially similar investment style as the Portfolio.

The Adviser has represented that it does not provide sub-advisory investment services to other investment companies that have a substantially similar investment style as the Portfolio.

II. MANAGEMENT FEES CHARGED BY OTHER MUTUAL FUND COMPANIES FOR LIKE SERVICES.

Broadridge Financial Solutions, Inc. (“Broadridge”), an analytical service that is not affiliated with the Adviser, compared the fees charged to the Portfolio with fees charged to other investment companies for similar services offered by other investment advisers.^10,11 Broadridge’s analysis included the comparison of the Portfolio’s contractual management fee, estimated at the approximate current asset level of the Portfolio, to the median of the Fund’s Broadridge Expense Group (“EG”)¹² and the Portfolio’s contractual management fee ranking.¹³

9 The Supreme Court stated that “courts may give such comparisons the weight that they merit in light of the similarities and differences between the services that the clients in question require, but the courts must be wary of inapt comparisons.” Among the significant differences the Supreme Court noted that may exist between services provided to mutual funds and institutional accounts are “higher marketing costs.” Jones v. Harris at 1428.

10 The Supreme Court cautioned against accepting mutual fund fee comparisons without careful scrutiny since “these comparisons are problematic because these fees, like those challenged, may not be the product of negotiations conducted at arm’s length.” Jones v. Harris at 1429.

11 On June 5, 2015, Broadridge acquired the Fiduciary Services and Competitive Intelligence unit, i.e., the group responsible for providing the Portfolio’s 15(c) reports, from Thomson Reuters’ Lipper division. The group that maintains Lipper’s expense and performance databases and investment classification/objective remains a part of Thomson Reuters’ Lipper division. Accordingly, the Portfolio’s investment classification/objective continued to be determined by Lipper.

12 Broadridge does not consider average account size when constructing EGs. Funds with relatively small average account sizes tend to have higher transfer agent expense ratios than comparable sized funds that have relatively large average account sizes. There are limitations to Lipper expense category data because different funds categorize expenses differently.

13 The contractual management fee is calculated by Broadridge using the Portfolio’s contractual management fee rate at the hypothetical asset level. The hypothetical asset level is based on the combined net assets of all classes of the Portfolio, rounded up to the next $25 million. Broadridge’s total expense ratio information is based on the most recent annual report except as otherwise noted. A ranking of “1” would mean that Portfolio had the lowest effective fee rate in the Broadridge peer group.

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 59

Broadridge describes an EG as a representative sample of comparable funds. Broadridge’s standard methodology for screening funds to be included in an EG entails the consideration of several fund criteria, including fund type, Lipper investment classification/objective, load type and similar 12b-1/non-12b-1 service fees, asset (size) comparability, expense components and attributes. An EG will typically consist of seven to twenty funds.

Portfolio	Contractual Management Fee (%)14		Broadridge EG Median (%)		Broadridge EG Rank
Tax Aware Fixed Income Portfolio		0.500		0.511		5/15

Broadridge also compared the Portfolio’s total expense ratio to the medians of the Portfolio’s EG and Broadridge Expense Universe (“EU”). The EU is a broader group compared to the EG, consisting of all funds that have the same investment classifications/objective and load type as the subject Portfolio.¹⁵ Pro-forma total expense ratio (italicized) is shown to reflect the Portfolio’s 12b-1 fee reduction had the reduction been in effect during the Portfolio’s entire fiscal year.

Portfolio	Expense Ratio (%)16		Broadridge EG Median (%)		Broadridge Group Rank		Broadridge EU Median (%)		Broadridge EU Rank
Tax-Aware Fixed Income Portfolio		0.850		0.850		8/15		0.804		39/57
Pro-forma		0.800		0.850		4/15		0.804		26/57

Based on this analysis, considering pro-forma information where available, the Portfolio has a more favorable ranking on a total expense ratio basis than on a contractual management fee basis.

III. COSTS TO THE ADVISER AND ITS AFFILIATES OF SUPPLYING SERVICES PURSUANT TO THE MANAGEMENT FEE ARRANGEMENT, EXCLUDING ANY INTRA-CORPORATE PROFIT.

The Adviser utilizes two profitability reporting systems, which operate independently but are aligned with each other, to estimate the Adviser’s profitability in connection with investment advisory services provided to the Portfolio. The Senior Officer has retained a consultant to provide independent advice

14 The contractual management fee does not reflect any expense reimbursements made by the Portfolio to the Adviser for certain clerical, legal, accounting, administrative, and other services. In addition, the contractual management fee does not reflect any advisory fee waivers for expense caps.

15 Except for asset (size) comparability, Broadridge uses the same criteria for selecting an EG when selecting an EU. Unlike the EG, the EU allows for the same adviser to be represented by more than just one fund.

16 Most recently completed fiscal year Class A share total expense ratio.

60 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

regarding the alignment of the two profitability systems as well as the methodologies and allocations utilized by both profitability systems. See Section IV for additional discussion.

IV. PROFIT MARGINS OF THE ADVISER AND ITS AFFILIATES FOR SUPPLYING SUCH SERVICES.

The Portfolio’s profitability information, prepared by the Adviser for the Board of Directors, was reviewed by the Senior Officer and the consultant. The Adviser’s profitability from providing investment advisory services to the Portfolio was negative, during calendar year 2014.

In addition to the Adviser’s direct profits from managing the Portfolio, certain of the Adviser’s affiliates have business relationships with the Portfolio and may earn a profit from providing other services to the Portfolio. The courts have referred to this type of business opportunity as “fall-out benefits” to the Adviser and indicated that such benefits should be factored into the evaluation of the total relationship between the Portfolio and the Adviser. Neither case law nor common business practice precludes the Adviser’s affiliates from earning a reasonable profit on this type of relationship provided the affiliates’ charges and services are competitive and the relationship otherwise complies with the 40 Act restrictions. These affiliates provide transfer agent and distribution related services to the Portfolio and receive transfer agent fees, Rule 12b-1 payments, front-end sales loads and contingent deferred sales charges (“CDSC”). During the Portfolio’s most recently completed fiscal year, ABI received from the Portfolio $2,703 and $10 in Rule 12b-1 and CDSC fees, respectively.

AllianceBernstein Investments, Inc. (“ABI”), an affiliate of the Adviser, is the Fund’s principal underwriter. ABI and the Adviser have disclosed in the Portfolio’s prospectus that they may make revenue sharing payments from their own resources, in addition to resources derived from sales loads and Rule 12b-1 fees, to firms that sell shares of the Portfolio. In 2014, ABI paid approximately 0.05% of the average monthly assets of the AB Mutual Funds or approximately $20.4 million for distribution services and educational support (revenue sharing payments).

Fees and reimbursements for out of pocket expenses charged by AllianceBernstein Investor Services, Inc. (“ABIS”), the affiliated transfer agent for the Portfolio, are based on the level of the network account and the class of shares held by the account. ABIS also receives a fee per shareholder sub-account for each account maintained by an intermediary on an omnibus basis. ABIS received $15,037 in fees from the Portfolio during the Portfolio’s most recently completed fiscal year.

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 61

V. POSSIBLE ECONOMIES OF SCALE

The Adviser has indicated that economies of scale are being shared with shareholders through pricing to scale, breakpoints, fee reductions/waivers and enhancement to services.

In May 2012, an independent consultant, retained by the Senior Officer, provided the Board of Directors information on the Adviser’s firm-wide average costs from 2005 through 2011 and the potential economies of scale. The independent consultant noted that from 2005 through 2007 the Adviser experienced significant growth in assets under management (“AUM”). During this period, operating expenses increased, in part to keep up with growth, and in part reflecting market returns. However, from 2008 through the first quarter of 2009, AUM rapidly and significantly decreased due to declines in market value and client withdrawals. When AUM rapidly decreased, some operating expenses categories, including base compensation and office space, adjusted more slowly during this period, resulting in an increase in average costs. Since 2009, AUM has experienced less significant changes. The independent consultant noted that changes in operating expenses reflect changes in business composition and business practices in response to changes in financial markets. Finally, the independent consultant concluded that the increase in average cost and the decline in net operating margin across the Adviser since late 2008 are inconsistent with the view that there are currently reductions in average costs due to economies of scale that can be shared with the AB Mutual Funds managed by the Adviser through lower fees.

Previously, in February 2008, the independent consultant provided the Board of Directors an update of the Deli¹⁷ study on advisory fees and various fund characteristics.¹⁸ The independent consultant first reiterated the results of his previous two dimensional comparison analysis (fund size and family size) with the Board of Directors.¹⁹ The independent consultant then discussed the results of the regression model that was utilized to study the effects of various factors on advisory fees. The regression model output indicated that the bulk of the variation in fees predicted were explained by various factors, but substantially by fund AUM,

17 The Deli study, originally published in 2002 based on 1997 data and updated for the February 2008 Presentation, may be of diminished value due to the age of the data used in the presentation and the changes experienced in the industry since 2008.

18 As mentioned previously, the Supreme Court cautioned against accepting mutual fund fee comparisons without careful scrutiny since the fees may not be the product of negotiations conducted at arm’s length. See Jones v. Harris at 1429.

19 The two dimensional analysis showed patterns of lower advisory fees for funds with larger asset sizes and funds from larger family sizes compared to funds with smaller asset sizes and funds from smaller family sizes, which according to the independent consultant is indicative of a sharing of economies of scale and scope. However, in less liquid and active markets, such is not the case, as the empirical analysis showed potential for diseconomies of scale in those markets. The empirical analysis also showed diminishing economies of scale and scope as funds surpassed a certain high level of assets.

62 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

family AUM, index fund indicator and investment style. The independent consultant also compared the advisory fees of the AB Mutual Funds to similar funds managed by 19 other large asset managers, regardless of the fund size and each Adviser’s proportion of mutual fund assets to non-mutual fund assets.

VI. NATURE AND QUALITY OF THE ADVISER’S SERVICES, INCLUDING THE PERFORMANCE OF THE FUND

With assets under management of approximately $463 billion as of September 30, 2015, the Adviser has the investment experience to manage and provide non-investment services (described in Section I) to the Portfolio.

The information prepared by Broadridge shows the 1 year performance returns and rankings²⁰ of the Portfolio relative to its Broadridge Performance Group (“PG”) and Broadridge Performance Universe (“PU”)²¹ for the period ended July 31, 2015.²²

Tax-Aware Fixed Income Portfolio	Fund Return (%)		PG Median (%)		PU Median (%)		PG Rank	PU Rank
1 year		2.75		3.20		3.81	12/15	56/62

20 The performance return and rankings are for the Portfolio’s Class A shares. The performance return of the Portfolio was provided by Broadridge.

21 The Portfolio’s PG is identical to the Portfolio’s EG. The Portfolio’s PU is not identical to the Portfolio’s EU as the criteria for including/excluding a fund from a PU is somewhat different from that of an EU.

22 The current Lipper investment classification/objective dictates the PG and PU throughout the life of the Portfolio even if the Portfolio had a different investment classification/objective at a different point in time.

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 63

Set forth below are the 1 year and since inception performance returns of the Portfolio (in bold)²³ versus its benchmark.²⁴ Portfolio and benchmark volatility and reward-to-variability ratio (“Sharpe Ratio”) information is also shown.²⁵

	Period Ending July 31, 2015 Annualized Net Performance (%)
	1 Year (%)		Since Inception (%)		Volatility (%)		Sharpe (%)		Risk Period (Year)
Tax-Aware Fixed Income Portfolio		2.76		4.64		2.40		1.09		1
Barclays Municipal Bond Index		3.56		5.92		2.52		1.34		1
Inception Date: December 11, 2013

CONCLUSION:

Based on the factors discussed above the Senior Officer’s conclusion is that the proposed advisory fee for the Portfolio is reasonable and within the range of what would have been negotiated at arm’s length in light of all the surrounding circumstances. This conclusion in respect of the Portfolio is based on an evaluation of all of these factors and no single factor was dispositive.

Dated: November 25, 2015

23 The performance returns and risk measures shown in the table are for the Class A shares of the Portfolio.

24 The Adviser provided Portfolio and benchmark performance return information for periods through July 31, 2015.

25 Portfolio and benchmark volatility and Sharpe Ratio information was obtained through Lipper LANA, a database maintained by Lipper. Volatility is a statistical measure of the tendency of a market price or yield to vary over time. A Sharpe Ratio is a risk adjusted measure of return that divides a fund’s return in excess of the riskless return by the fund’s standard deviation. A fund with a greater volatility would be viewed as more risky than a fund with equivalent performance but lower volatility; for that reason, a greater return would be demanded for the more risky fund. A fund with a higher Sharpe Ratio would be viewed as better performing than a fund with a lower Sharpe Ratio.

64 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

THIS PAGE IS NOT PART OF THE SHAREHOLDER REPORT OR THE FINANCIAL STATEMENTS

AB FAMILY OF FUNDS

US EQUITY

US Core

Core Opportunities Fund

Select US Equity Portfolio

US Growth

Concentrated Growth Fund

Discovery Growth Fund

Growth Fund

Large Cap Growth Fund

Small Cap Growth Portfolio

US Value

Discovery Value Fund

Equity Income Fund

Growth & Income Fund

Small Cap Value Portfolio

Value Fund

INTERNATIONAL/ GLOBAL EQUITY

International/Global Core

Global Core Equity Portfolio

Global Equity & Covered Call Strategy Fund

Global Thematic Growth Fund

International Portfolio

Tax-Managed International Portfolio

International/Global Growth

International Growth Fund

International/Global Value

Asia ex-Japan Equity Portfolio

International Value Fund

FIXED INCOME

Municipal

High Income Municipal Portfolio

Intermediate California Municipal Portfolio

Intermediate Diversified Municipal Portfolio

Intermediate New York Municipal Portfolio

Municipal Bond Inflation Strategy

FIXED INCOME (continued)

Tax-Aware Fixed Income Portfolio

National Portfolio

Arizona Portfolio

California Portfolio

Massachusetts Portfolio

Michigan Portfolio

Minnesota Portfolio

New Jersey Portfolio

New York Portfolio

Ohio Portfolio

Pennsylvania Portfolio

Virginia Portfolio

Taxable

Bond Inflation Strategy

Global Bond Fund

High Income Fund

High Yield Portfolio

Intermediate Bond Portfolio

Limited Duration High Income Portfolio

Short Duration Portfolio

ALTERNATIVES

All Market Real Return Portfolio*

Credit Long/Short Portfolio

Global Real Estate Investment Fund

Long/Short Multi-Manager Fund

Multi-Manager Alternative Strategies Fund

Select US Long/Short Portfolio

Unconstrained Bond Fund

MULTI-ASSET

All Market Growth Portfolio*

All Market Income Portfolio

Emerging Markets Multi-Asset Portfolio

Global Risk Allocation Fund

MULTI-ASSET (continued)

Target-Date

Multi-Manager Select Retirement Allocation Fund

Multi-Manager Select 2010 Fund

Multi-Manager Select 2015 Fund

Multi-Manager Select 2020 Fund

Multi-Manager Select 2025 Fund

Multi-Manager Select 2030 Fund

Multi-Manager Select 2035 Fund

Multi-Manager Select 2040 Fund

Multi-Manager Select 2045 Fund

Multi-Manager Select 2050 Fund

Multi-Manager Select 2055 Fund

Wealth Strategies

Balanced Wealth Strategy

Conservative Wealth Strategy

Wealth Appreciation Strategy

Tax-Managed Balanced Wealth Strategy

Tax-Managed Conservative Wealth Strategy

Tax-Managed Wealth Appreciation Strategy

CLOSED-END FUNDS

AB Multi-Manager Alternative Fund

Alliance California Municipal Income Fund

AllianceBernstein Global High Income Fund

AllianceBernstein Income Fund

AllianceBernstein National Municipal Income Fund

We also offer Exchange Reserves, which serves as the money market fund exchange vehicle for the AB mutual funds. An investment in Exchange Reserves is not a deposit in a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.

Investors should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.abglobal.com or contact your AB representative. Please read the prospectus and/or summary prospectus carefully before investing.

* Prior to December 15, 2014, All Market Growth Portfolio was named Dynamic All Market Fund; All Market Real Return Portfolio was named Real Asset Strategy.

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 65

AB Family of Funds

NOTES

66 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

NOTES

AB TAX-AWARE FIXED INCOME PORTFOLIO  • 67

NOTES

68 •  AB TAX-AWARE FIXED INCOME PORTFOLIO

AB TAX-AWARE FIXED INCOME PORTFOLIO

1345 Avenue of the Americas

New York, NY 10105

800.221.5672

TAFI-0151-1015                

ITEM 2. CODE OF ETHICS.

(a) The registrant has adopted a code of ethics that applies to its principal executive officer, principal financial officer and principal accounting officer. A copy of the registrant’s code of ethics is filed herewith as Exhibit 12(a)(1).

(b) During the period covered by this report, no material amendments were made to the provisions of the code of ethics adopted in 2(a) above.

(c) During the period covered by this report, no implicit or explicit waivers to the provisions of the code of ethics adopted in 2(a) above were granted.

ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.

The registrant’s Board of Directors has determined that independent directors Garry L. Moody, William H. Foulk, Jr. and Marshall C. Turner, Jr. qualify as audit committee financial experts.

ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

(a) - (c) The following table sets forth the aggregate fees billed by the independent registered public accounting firm Ernst & Young LLP, for the Fund’s last two fiscal years for professional services rendered for: (i) the audit of the Fund’s annual financial statements included in the Fund’s annual report to stockholders; (ii) assurance and related services that are reasonably related to the performance of the audit of the Fund’s financial statements and are not reported under (i), which include advice and education related to accounting and auditing issues and quarterly press release review (for those Funds which issue press releases), and preferred stock maintenance testing (for those Funds that issue preferred stock); and (iii) tax compliance, tax advice and tax return preparation.

		Audit Fees		Audit - Related Fees		Tax Fees
AB Intermediate Bond	2014	$	65,781	$	—	$	13,839
	2015	$	67,775	$	—	$	20,261
AB Bond Inflation Strategy	2014	$	67,918	$	—	$	15,678
	2015	$	69,976	$	—	$	19,285
AB Municipal Bond Inflation Strategy	2014	$	62,424	$	—	$	13,838
	2015	$	64,315	$	—	$	17,713
AB All Market Real Return	2014	$	74,939	$	—	$	26,069
	2015	$	77,210	$	—	$	37,241
AB Credit Long/Short	2014	$	63,750	$	—	$	15,552
	2015	$	87,576			$	25,575
AB High Yield	2014	$	67,500	$	—	$	17,573
	2015	$	92,727	$	—	$	22,832
AB Tax Aware Fixed Income	2014	$	25,500	$	—	$	17,957
	2015	$	35,030	$	—	$	21,073

(d) Not applicable.

(e) (1) Beginning with audit and non-audit service contracts entered into on or after May 6, 2003, the Fund’s Audit Committee policies and procedures require the pre-approval of all audit and non-audit services provided to the Fund by the Fund’s independent registered public accounting firm. The Fund’s Audit Committee policies and procedures also require pre-approval of all audit and non-audit services provided to the Adviser and Service Affiliates to the extent that these services are directly related to the operations or financial reporting of the Fund.

(e) (2) All of the amounts for Audit Fees, Audit-Related Fees and Tax Fees in the table under Item 4 (a) – (c) are for services pre-approved by the Fund’s Audit Committee.

(f) Not applicable.

(g) The following table sets forth the aggregate non-audit services provided to the Fund, the Fund’s Adviser and entities that control, are controlled by or under common control with the Adviser that provide ongoing services to the Fund:

		All Fees for Non-Audit Services Provided to the Portfolio, the Adviser and Service Affiliates		Pre-approved by the Audit Committee (Portion Comprised of Audit Related Fees) (Portion Comprised of Tax Fees)
AB Intermediate Bond	2014	$	424,494	$	13,839
				$	—
				$	(13,839	)
	2015	$	438,336	$	20,261
				$	—
				$	(20,261	)
AB Bond Inflation Strategy	2014	$	426,333	$	15,678
				$	—
				$	(15,678	)
	2015	$	437,360	$	19,285
				$	—
				$	(19,285	)
AB Municipal Bond Inflation Strategy	2014	$	424,493	$	13,838
				$	—
				$	(13,838	)
	2015	$	435,788	$	17,713
				$	—
				$	(17,713	)
AB All Market Real Return	2014	$	436,724	$	26,069
				$	—
				$	(26,069	)
	2015	$	455,316	$	37,241
				$	—
				$	(37,241	)
AB Credit Long/Short	2014	$	426,207	$	15,552
				$	—
				$	(15,552	)
	2015	$	443,650	$	25,575
				$	—
				$	(25,575	)
AB High Yield	2014	$	428,228	$	17,573
				$	—
				$	(17,573	)
	2015	$	440,907	$	22,832
				$	—
				$	(22,832	)
AB Tax Aware Fixed Income	2014	$	428,612	$	17,957
				$	—
				$	(17,957	)
	2015	$	439,148	$	21,073
				$	—
				$	(21,073	)

(h) The Audit Committee of the Fund has considered whether the provision of any non-audit services not pre-approved by the Audit Committee provided by the Fund’s independent registered public accounting firm to the Adviser and Service Affiliates is compatible with maintaining the auditor’s independence.

ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.

Not applicable to the registrant.

ITEM 6. SCHEDULE OF INVESTMENTS.

Please see Schedule of Investments contained in the Report to Shareholders included under Item 1 of this Form N-CSR.

ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable to the registrant.

ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable to the registrant.

ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.

Not applicable to the registrant.

ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

There have been no material changes to the procedures by which shareholders may recommend nominees to the Fund’s Board of Directors since the Fund last provided disclosure in response to this item.

ITEM 11. CONTROLS AND PROCEDURES.

(a) The registrant’s principal executive officer and principal financial officer have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3 (c) under the Investment Company Act of 1940, as amended) are effective at the reasonable assurance level based on their evaluation of these controls and procedures as of a date within 90 days of the filing date of this document.

(b) There were no changes in the registrant’s internal controls over financial reporting that occurred during the second fiscal quarter of the period that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

ITEM 12. EXHIBITS.

The following exhibits are attached to this Form N-CSR:

EXHIBIT NO.	DESCRIPTION OF EXHIBIT
12 (a) (1)	Code of Ethics that is subject to the disclosure of Item 2 hereof
12 (b) (1)	Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
12 (b) (2)	Certification of Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
12 (c)	Certification of Principal Executive Officer and Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

(Registrant): AB Bond Fund, Inc.
By:	/s/ Robert M. Keith
	Robert M. Keith President

Date: December 21, 2015

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By:	/s/ Robert M. Keith
	Robert M. Keith President

Date: December 21, 2015

By:	/s/ Joseph J. Mantineo
	Joseph J. Mantineo Treasurer and Chief Financial Officer

Date: December 21, 2015