The Managers Funds
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSRS
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file
number: 811-03752
(Exact name of registrant as specified in charter)
|
800 Connecticut Avenue, Norwalk, Connecticut 06854 |
(Address of principal executive offices) (Zip code)
|
Managers Investment Group LLC
800 Connecticut Avenue, Norwalk, Connecticut 06854 |
(Name and address of agent for service)
Registrants telephone number, including area code: (203) 299-3500
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Date of fiscal year end: DECEMBER 31 |
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Date of reporting period: JANUARY 1, 2012 JUNE 30, 2012 |
(Semi-Annual Shareholder Report) |
Item 1. |
Reports to Shareholders |
SEMI-ANNUAL REPORT
Managers Funds
June 30, 2012
Managers Special Equity Fund
Managers Special Equity Fund
Semi-Annual Report June 30, 2012
(unaudited)
TABLE OF CONTENTS
Nothing contained herein is to be considered an offer, sale or solicitation of an offer to buy shares of any series of
the Managers Family of Funds. Such offering is made only by Prospectus, which includes details as to offering price and other material information.
About Your Funds Expenses (unaudited)
As a shareholder of a Fund, you may incur two types of costs: (1) transaction costs,
which may include sales charges (loads) on purchase payments; redemption fees; and exchange fees; 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 $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 following table provides information about the 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 following table provides information about hypothetical account values and
hypothetical expenses based on the Funds actual expense ratio and an assumed annual rate of return of 5% before expenses, which is not the Funds 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), redemption fees, or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine
the relative total costs of owning different funds.
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Six Months Ended June 30, 2012 |
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Expense Ratio for the Period |
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Beginning Account Value 01/01/12 |
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Ending Account Value 06/30/2012 |
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Expenses Paid During the Period* |
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Managers Special Equity Fund |
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Managers Class |
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Based on Actual Fund Return |
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1.35 |
% |
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$ |
1,000 |
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$ |
1,080 |
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$ |
6.98 |
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Hypothetical (5% return before expenses) |
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1.35 |
% |
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$ |
1,000 |
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$ |
1,018 |
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$ |
6.77 |
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Institutional Class |
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Based on Actual Fund Return |
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1.10 |
% |
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$ |
1,000 |
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$ |
1,081 |
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$ |
5.69 |
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Hypothetical (5% return before expenses) |
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1.10 |
% |
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$ |
1,000 |
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$ |
1,019 |
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$ |
5.52 |
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* |
Expenses are equal to the Funds annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the period
(182), then divided by 366. |
Fund Performance
Periods ended June 30, 2012 (unaudited)
The table below shows the average annual total returns for the periods indicated for the Fund, as well as the Funds relative index
for the same time periods.
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Average Annual Total
Returns1 |
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Six Months* |
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One Year |
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Five Years |
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Ten Years |
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Since Inception |
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Inception Date |
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Managers Special Equity Fund2,3 |
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Managers Class |
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8.02 |
% |
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(2.27 |
)% |
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(0.11 |
)% |
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5.97 |
% |
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11.04 |
% |
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06/01/84 |
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Institutional Class |
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8.13 |
% |
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(1.93 |
)% |
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0.13 |
% |
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4.89 |
% |
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05/03/04 |
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Russell
2000® Growth Index4 |
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8.81 |
% |
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(2.71 |
)% |
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1.99 |
% |
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7.39 |
% |
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7.44 |
% |
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06/01/84 |
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The performance data shown represents past performance. Past performance is not a
guarantee of future results. Current performance may be lower or higher than the performance data quoted. The investment return and principal value of an investment in the Fund will fluctuate so that an investors shares, when redeemed, may be
worth more or less than their original cost. For performance information through the most recent month end, please call (800) 835-3879 or visit our Web site at www.managersinvest.com.
Investors should carefully consider the Funds investment objectives, risks, charges and expenses before investing. For this and
other information, please call (800) 835-3879 or visit our Web site at www.managersinvest.com for a free prospectus. Read it carefully before investing or sending money. Funds are distributed by Managers Distributors, Inc., member FINRA.
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The date reflects the inception date of the Fund, not the index. |
1 |
Total return equals income yield plus share price change and assumes reinvestment of all dividends and capital gain distributions. Returns are net of
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fees and may reflect offsets of Fund expenses as described in the Prospectus. No adjustment has been made for taxes payable by shareholders on their reinvested dividends and capital gain
distributions. Returns for periods greater than one year are annualized. The listed returns on the Fund are net of expenses and based on the published NAV as of June 30, 2012. All returns are in U.S. dollars($). |
2 |
From time to time, the Funds advisor has waived its fees and/or absorbed Fund expenses, which has resulted in higher returns.
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3 |
The Fund is subject to risks associated with investments in small capitalization companies, such as erratic earnings patterns, competitive conditions,
limited earnings history, and a reliance on one or a limited number of products. |
4 |
The Russell
2000® Growth Index measures the performance of the Russell
2000® Index companies with higher price-to-book ratios and higher forecasted growth values. Unlike the fund, the
index is unmanaged, is not available for investment and does not incur expenses. The Russell 2000® Growth Index
and the Russell 2000® Index are registered trademarks of Russell Investments. Russell® is a registered trademark of Russell Investments. |
Not FDIC Insured, nor bank guaranteed. May lose value.
Managers Special Equity Fund
Fund Snapshots
June 30, 2012
Portfolio Breakdown (unaudited)
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Industry |
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Managers Special Equity Fund** |
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Russell 2000® Growth Index |
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Health Care |
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20.6 |
% |
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22.1 |
% |
Consumer Discretionary |
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20.1 |
% |
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16.2 |
% |
Information Technology |
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19.5 |
% |
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22.1 |
% |
Industrials |
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15.2 |
% |
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16.9 |
% |
Financial |
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8.4 |
% |
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6.8 |
% |
Consumer Staples |
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5.1 |
% |
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4.8 |
% |
Energy |
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4.8 |
% |
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5.5 |
% |
Materials |
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2.4 |
% |
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4.2 |
% |
Telecommunication Services |
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0.0 |
% |
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1.1 |
% |
Utilities |
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0.0 |
% |
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0.3 |
% |
Other Assets and Liabilities |
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3.9 |
% |
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0.0 |
% |
** |
As a percentage of net assets
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Top Ten Holdings (unaudited)
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Security Name |
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% of Net Assets |
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Tangoe, Inc. |
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1.7 |
% |
Pier 1 Imports, Inc.* |
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1.4 |
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Air Methods Corp. |
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1.3 |
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Texas Capital Bancshares, Inc. |
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1.3 |
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Treehouse Foods, Inc. |
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1.3 |
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Wabtec Corp. |
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1.2 |
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MAXIMUS, Inc. |
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1.2 |
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athenahealth, Inc. |
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1.1 |
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SVB Financial Group |
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1.1 |
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Acacia Research Corp.* |
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1.1 |
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Top Ten as a Group |
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12.7 |
% |
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* |
Top Ten Holding at December 31, 2011
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Any sectors, industries, or
securities discussed should not be perceived as investment recommendations. Mention of a specific security should not be considered a recommendation to buy or solicitation to sell that security. Specific securities mentioned in this report may have
been sold from the Funds portfolio of investments by the time you receive this report.
Managers Special Equity Fund
Schedule
of Portfolio Investments
June 30, 2012 (unaudited)
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Shares |
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Value |
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Common Stocks - 96.1% |
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Consumer Discretionary - 20.1% |
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Aeropostale, Inc.* |
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31,127 |
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$ |
554,994 |
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Americas Car-Mart, Inc.* |
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25,717 |
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999,105 |
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ANN, INC.* |
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34,418 |
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877,315 |
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Ascena Retail Group, Inc.* |
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76,549 |
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1,425,342 |
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Biglari Holdings, Inc.* |
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1,252 |
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483,760 |
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BJs Restaurants, Inc.* |
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22,520 |
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855,760 |
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Bridgepoint Education, Inc.* |
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18,943 |
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412,957 |
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Brunswick Corp. |
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26,743 |
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594,229 |
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Buckle, Inc., The1 |
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10,990 |
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434,874 |
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Buffalo Wild Wings, Inc.* |
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24,123 |
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2,090,017 |
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Capella Education Co.* |
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10,855 |
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377,320 |
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Carters, Inc.* |
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27,747 |
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1,459,492 |
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Cato Corp., The, Class A |
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14,520 |
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442,279 |
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Cheesecake Factory, Inc., The* |
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12,055 |
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385,278 |
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Childrens Place Retail Stores, Inc., The* |
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3,263 |
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162,595 |
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Coinstar, Inc.*,1 |
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36,025 |
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2,473,477 |
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Columbia Sportswear Co. |
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11,574 |
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620,598 |
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Cracker Barrel Old Country Store, Inc. |
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17,234 |
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1,082,295 |
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Crocs, Inc.* |
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31,402 |
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507,142 |
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Dana Holding Corp. |
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64,642 |
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828,064 |
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Dicks Sporting Goods, Inc. |
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8,799 |
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422,352 |
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DineEquity, Inc.* |
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11,195 |
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499,745 |
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Express, Inc.* |
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66,558 |
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1,209,359 |
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Finish Line, Inc., The, Class A |
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45,290 |
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947,014 |
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Francescas Holdings Corp.* |
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31,340 |
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846,493 |
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Genesco, Inc.* |
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18,580 |
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1,117,587 |
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GNC Holdings, Inc., Class A |
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14,481 |
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567,655 |
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Group 1 Automotive, Inc. |
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|
32,470 |
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1,480,957 |
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Hibbett Sports, Inc.* |
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27,135 |
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1,565,961 |
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HSN, Inc. |
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20,608 |
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831,533 |
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Interval Leisure Group, Inc. |
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27,000 |
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513,270 |
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Jos A Bank Clothiers, Inc.* |
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|
19,477 |
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826,993 |
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New York & Co, Inc.* |
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50,900 |
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|
177,132 |
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Overstock.com, Inc.*,1 |
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28,770 |
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198,801 |
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PetMed Express, Inc. |
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40,820 |
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496,371 |
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Pier 1 Imports, Inc.* |
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191,645 |
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3,148,727 |
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Pool Corp. |
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21,541 |
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871,549 |
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Red Robin Gourmet Burgers, Inc.* |
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|
26,680 |
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814,007 |
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Saks, Inc.*,1 |
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24,869 |
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264,855 |
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Sally Beauty Holdings, Inc.* |
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52,449 |
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1,350,037 |
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Select Comfort Corp.* |
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|
19,310 |
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|
403,965 |
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Sothebys1 |
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|
5,660 |
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|
188,818 |
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Shares |
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Value |
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Steven Madden, Ltd.* |
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|
58,862 |
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$ |
1,868,869 |
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Sturm Ruger & Co., Inc. |
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|
6,460 |
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|
259,369 |
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Teavana Holdings, Inc.* |
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|
10,627 |
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|
143,783 |
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Tenneco, Inc.* |
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|
38,428 |
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|
1,030,639 |
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Tesla Motors, Inc.*,1 |
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|
24,407 |
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|
763,695 |
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Tumi Holdings, Inc.*,1 |
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|
23,920 |
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|
418,600 |
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Tupperware Brands Corp. |
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|
16,830 |
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|
921,611 |
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Ulta Salon Cosmetics & Fragrance, Inc. |
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|
5,470 |
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|
510,789 |
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Under Armour, Inc., Class A*,1 |
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|
5,131 |
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|
484,777 |
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Valassis Communications, Inc.* |
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|
28,480 |
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|
619,440 |
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Vitamin Shoppe, Inc.* |
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|
11,170 |
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|
613,568 |
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Warnaco Group, Inc., The* |
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|
27,441 |
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|
1,168,438 |
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Wolverine World Wide, Inc. |
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|
29,480 |
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1,143,234 |
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Total Consumer Discretionary |
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45,756,886 |
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Consumer Staples - 5.1% |
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Annies, Inc.* |
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|
6,031 |
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|
252,458 |
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Cal-Maine Foods, Inc.1 |
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|
11,055 |
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|
432,251 |
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Caseys General Stores, Inc. |
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|
13,725 |
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|
809,638 |
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Coca-Cola Bottling Co. Consolidated |
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|
2,395 |
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|
153,951 |
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Fresh Market, Inc., The*,1 |
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|
14,171 |
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|
759,991 |
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Hain Celestial Group, Inc., The* |
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|
13,387 |
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|
736,820 |
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Harris Teeter Supermarkets, Inc. |
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|
19,646 |
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|
805,290 |
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Nu Skin Enterprises, Inc., Class A |
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|
23,228 |
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|
1,089,393 |
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Pricesmart, Inc.* |
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|
9,219 |
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|
622,375 |
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Revlon, Inc., Class A* |
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|
18,915 |
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|
|
269,160 |
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Rite Aid Corp.* |
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|
230,215 |
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|
322,301 |
|
Spectrum Brands Holdings, Inc.* |
|
|
5,260 |
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|
|
171,318 |
|
Treehouse Foods, Inc.* |
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|
46,837 |
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|
2,917,477 |
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United Natural Foods, Inc.* |
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|
37,498 |
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|
2,057,140 |
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USANA Health Sciences, Inc.* |
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|
5,395 |
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|
221,842 |
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Total Consumer Staples |
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11,621,405 |
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Energy - 4.8% |
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Approach Resources, Inc.* |
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|
62,070 |
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|
|
1,585,268 |
|
Cheniere Energy, Inc.* |
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|
23,172 |
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|
|
341,555 |
|
Clean Energy Fuels Corp.* |
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|
26,970 |
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|
|
418,035 |
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Dril-Quip, Inc.* |
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|
4,519 |
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|
296,401 |
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Energy XXI Bermuda, Ltd. |
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|
43,095 |
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|
1,348,443 |
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GasLog, Ltd.*,1 |
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|
27,818 |
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|
|
282,353 |
|
Lufkin Industries, Inc. |
|
|
23,383 |
|
|
|
1,270,164 |
|
McMoRan Exploration Co.*,1 |
|
|
33,963 |
|
|
|
430,311 |
|
Pacific Drilling SA*,1 |
|
|
86,020 |
|
|
|
732,030 |
|
Rosetta Resources, Inc.* |
|
|
24,830 |
|
|
|
909,771 |
|
Stone Energy Corp.* |
|
|
43,076 |
|
|
|
1,091,546 |
|
Vaalco Energy, Inc.* |
|
|
57,340 |
|
|
|
494,844 |
|
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The accompanying
notes are an integral part of these financial statements. 7 |
Managers Special Equity Fund
Schedule
of Portfolio Investments (continued)
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Shares |
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Value |
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Energy - 4.8% (continued) |
|
|
|
|
|
|
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|
W&T Offshore, Inc. |
|
|
34,121 |
|
|
$ |
522,052 |
|
Western Refining, Inc. |
|
|
56,111 |
|
|
|
1,249,592 |
|
Total Energy |
|
|
|
|
|
|
10,972,365 |
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Financials - 8.4% |
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|
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|
|
Bank of the Ozarks, Inc. |
|
|
23,479 |
|
|
|
706,248 |
|
Cohen & Steers, Inc.1 |
|
|
12,320 |
|
|
|
425,163 |
|
Ezcorp, Inc., Class A* |
|
|
25,328 |
|
|
|
594,195 |
|
Financial Engines, Inc.* |
|
|
12,397 |
|
|
|
265,916 |
|
HFF, Inc., Class A* |
|
|
25,175 |
|
|
|
350,940 |
|
Home Bancshares, Inc. |
|
|
65,450 |
|
|
|
2,001,461 |
|
MarketAxess Holdings, Inc. |
|
|
62,356 |
|
|
|
1,661,163 |
|
Nationstar Mortgage Holdings, Inc.*,1 |
|
|
14,569 |
|
|
|
313,525 |
|
Ocwen Financial Corp.* |
|
|
51,607 |
|
|
|
969,179 |
|
Omega Healthcare Investors, Inc. |
|
|
4,660 |
|
|
|
104,850 |
|
PrivateBancorp, Inc. |
|
|
76,710 |
|
|
|
1,132,240 |
|
Prosperity Bancshares, Inc. |
|
|
39,880 |
|
|
|
1,676,156 |
|
Signature Bank* |
|
|
29,300 |
|
|
|
1,786,421 |
|
Strategic Hotels & Resorts, Inc.* |
|
|
26,305 |
|
|
|
169,930 |
|
SVB Financial Group* |
|
|
43,474 |
|
|
|
2,552,793 |
|
Texas Capital Bancshares, Inc.* |
|
|
72,359 |
|
|
|
2,922,580 |
|
Western Alliance Bancorp* |
|
|
33,770 |
|
|
|
316,087 |
|
WisdomTree Investments, Inc.* |
|
|
54,131 |
|
|
|
355,641 |
|
World Acceptance Corp.* |
|
|
7,660 |
|
|
|
504,028 |
|
Zillow, Inc., Class A* |
|
|
7,993 |
|
|
|
308,770 |
|
Total Financials |
|
|
|
|
|
|
19,117,286 |
|
Health Care - 20.6% |
|
|
|
|
|
|
|
|
Air Methods Corp.* |
|
|
29,765 |
|
|
|
2,924,412 |
|
Akorn, Inc.* |
|
|
81,750 |
|
|
|
1,289,197 |
|
Align Technology, Inc.* |
|
|
39,514 |
|
|
|
1,322,138 |
|
Alnylam Pharmaceuticals, Inc.* |
|
|
11,655 |
|
|
|
136,014 |
|
AMAG Pharmaceuticals, Inc.* |
|
|
10,100 |
|
|
|
155,540 |
|
Amarin Corp. PLC, ADR* |
|
|
53,577 |
|
|
|
774,723 |
|
Amedisys, Inc.* |
|
|
629 |
|
|
|
7,831 |
|
Amicus Therapeutics, Inc.* |
|
|
19,710 |
|
|
|
108,405 |
|
AMN Healthcare Services, Inc.* |
|
|
12,900 |
|
|
|
76,497 |
|
Analogic Corp. |
|
|
6,325 |
|
|
|
392,150 |
|
Arena Pharmaceuticals, Inc.* |
|
|
25,141 |
|
|
|
250,907 |
|
Ariad Pharmaceuticals, Inc.* |
|
|
32,463 |
|
|
|
558,688 |
|
Arqule, Inc.* |
|
|
32,300 |
|
|
|
191,539 |
|
Array Biopharma, Inc.* |
|
|
71,125 |
|
|
|
246,804 |
|
ArthroCare Corp.* |
|
|
9,725 |
|
|
|
284,748 |
|
athenahealth, Inc.*,1 |
|
|
32,957 |
|
|
|
2,609,206 |
|
Auxilium Pharmaceuticals, Inc.* |
|
|
15,253 |
|
|
|
410,153 |
|
BioCryst Pharmaceuticals, Inc.* |
|
|
42,420 |
|
|
|
168,832 |
|
|
|
|
|
|
|
|
|
|
|
|
Shares |
|
|
Value |
|
BioMarin Pharmaceutical, Inc.* |
|
|
18,629 |
|
|
$ |
737,336 |
|
Catalyst Health Solutions, Inc.* |
|
|
25,910 |
|
|
|
2,421,030 |
|
Celldex Therapeutics, Inc.* |
|
|
60,865 |
|
|
|
315,889 |
|
Centene Corp.* |
|
|
67,669 |
|
|
|
2,040,896 |
|
Cepheid, Inc.* |
|
|
20,816 |
|
|
|
931,516 |
|
Chemed Corp. |
|
|
18,754 |
|
|
|
1,133,492 |
|
Computer Programs & Systems, Inc. |
|
|
29,680 |
|
|
|
1,698,289 |
|
Cryolife, Inc.* |
|
|
18,915 |
|
|
|
98,925 |
|
Cubist Pharmaceuticals, Inc.* |
|
|
17,865 |
|
|
|
677,262 |
|
DexCom, Inc.* |
|
|
45,046 |
|
|
|
583,796 |
|
Endologix, Inc.* |
|
|
41,493 |
|
|
|
640,652 |
|
Genomic Health, Inc.* |
|
|
19,478 |
|
|
|
650,565 |
|
HealthStream, Inc.* |
|
|
18,860 |
|
|
|
490,360 |
|
HeartWare International, Inc.*,1 |
|
|
7,174 |
|
|
|
637,051 |
|
HMS Holdings Corp.* |
|
|
65,880 |
|
|
|
2,194,463 |
|
Impax Laboratories, Inc.* |
|
|
109,420 |
|
|
|
2,217,943 |
|
Incyte Corp, Ltd.*,1 |
|
|
41,062 |
|
|
|
932,108 |
|
Infinity Pharmaceuticals, Inc.* |
|
|
13,250 |
|
|
|
179,670 |
|
Insulet Corp.* |
|
|
21,869 |
|
|
|
467,341 |
|
Integra LifeSciences Holdings Corp.* |
|
|
12,002 |
|
|
|
446,234 |
|
Invacare Corp. |
|
|
4,665 |
|
|
|
71,981 |
|
IPC The Hospitalist Co., Inc.* |
|
|
45,370 |
|
|
|
2,056,168 |
|
Jazz Pharmaceuticals PLC* |
|
|
10,590 |
|
|
|
476,656 |
|
MAKO Surgical Corp.*,1 |
|
|
11,351 |
|
|
|
290,699 |
|
Medicis Pharmaceutical Corp., Class A |
|
|
46,708 |
|
|
|
1,595,078 |
|
Medivation, Inc.* |
|
|
6,371 |
|
|
|
582,309 |
|
Molina Healthcare, Inc.* |
|
|
60,835 |
|
|
|
1,427,189 |
|
MWI Veterinary Supply, Inc.* |
|
|
2,986 |
|
|
|
306,871 |
|
National Research Corp. |
|
|
3,930 |
|
|
|
205,736 |
|
NuVasive, Inc.* |
|
|
12,666 |
|
|
|
321,210 |
|
Onyx Pharmaceuticals, Inc.* |
|
|
13,997 |
|
|
|
930,101 |
|
Owens & Minor, Inc. |
|
|
35,032 |
|
|
|
1,073,030 |
|
Pharmacyclics, Inc.*,1 |
|
|
8,343 |
|
|
|
455,611 |
|
Pozen, Inc.* |
|
|
41,096 |
|
|
|
256,439 |
|
Providence Service Corp., The* |
|
|
14,385 |
|
|
|
197,218 |
|
PSS World Medical, Inc.* |
|
|
29,748 |
|
|
|
624,411 |
|
Questcor Pharmaceuticals, Inc.*,1 |
|
|
19,692 |
|
|
|
1,048,402 |
|
RTI Biologics, Inc.* |
|
|
77,385 |
|
|
|
290,968 |
|
Spectrum Pharmaceuticals, Inc.* |
|
|
9,055 |
|
|
|
140,896 |
|
STERIS Corp. |
|
|
29,388 |
|
|
|
921,902 |
|
Team Health Holdings, Inc.* |
|
|
12,397 |
|
|
|
298,644 |
|
Theravance, Inc.* |
|
|
7,725 |
|
|
|
171,650 |
|
Trius Therapeutics, Inc.* |
|
|
34,365 |
|
|
|
197,942 |
|
Vanda Pharmaceuticals, Inc.* |
|
|
23,310 |
|
|
|
102,564 |
|
Vical, Inc.* |
|
|
31,830 |
|
|
|
114,588 |
|
|
The accompanying
notes are an integral part of these financial statements. 8 |
Managers Special Equity Fund
Schedule
of Portfolio Investments (continued)
|
|
|
|
|
|
|
|
|
|
|
Shares |
|
|
Value |
|
Health Care - 20.6% (continued) |
|
|
|
|
|
|
|
|
Vivus, Inc.* |
|
|
4,943 |
|
|
$ |
141,073 |
|
Vocera Communications, Inc.* |
|
|
28,161 |
|
|
|
754,433 |
|
WellCare Health Plans, Inc.* |
|
|
6,736 |
|
|
|
357,008 |
|
Total Health Care |
|
|
|
|
|
|
46,813,379 |
|
Industrials - 15.2% |
|
|
|
|
|
|
|
|
Acacia Research Corp.* |
|
|
67,048 |
|
|
|
2,496,868 |
|
Acuity Brands, Inc. |
|
|
33,772 |
|
|
|
1,719,332 |
|
Advisory Board Co., The* |
|
|
31,622 |
|
|
|
1,568,135 |
|
Allegiant Travel Co.* |
|
|
13,290 |
|
|
|
926,047 |
|
American Science & Engineering, Inc. |
|
|
7,125 |
|
|
|
402,206 |
|
Applied Industrial Technologies, Inc. |
|
|
21,925 |
|
|
|
807,936 |
|
AZZ, Inc. |
|
|
8,700 |
|
|
|
532,962 |
|
Barnes Group, Inc. |
|
|
14,303 |
|
|
|
347,420 |
|
BE Aerospace, Inc.* |
|
|
36,314 |
|
|
|
1,585,469 |
|
Belden, Inc. |
|
|
21,931 |
|
|
|
731,399 |
|
Brinks Co., The |
|
|
29,357 |
|
|
|
680,495 |
|
Chart Industries, Inc.* |
|
|
30,665 |
|
|
|
2,108,525 |
|
Consolidated Graphics, Inc.* |
|
|
2,930 |
|
|
|
85,117 |
|
Deluxe Corp. |
|
|
34,489 |
|
|
|
860,156 |
|
Dollar Thrifty Automotive Group, Inc.* |
|
|
15,120 |
|
|
|
1,224,115 |
|
EMCOR Group, Inc. |
|
|
5,995 |
|
|
|
166,781 |
|
Exponent, Inc.* |
|
|
10,655 |
|
|
|
562,904 |
|
Generac Holdings, Inc. |
|
|
11,455 |
|
|
|
275,607 |
|
Hexcel Corp.* |
|
|
28,426 |
|
|
|
733,107 |
|
HNI Corp. |
|
|
14,910 |
|
|
|
383,933 |
|
HUB Group, Inc., Class A* |
|
|
68,460 |
|
|
|
2,478,252 |
|
Insperity, Inc. |
|
|
13,720 |
|
|
|
371,126 |
|
Interface, Inc., Class A |
|
|
25,241 |
|
|
|
344,035 |
|
Knoll, Inc. |
|
|
31,836 |
|
|
|
427,239 |
|
Meritor, Inc.* |
|
|
31,300 |
|
|
|
163,386 |
|
Middleby Corp.* |
|
|
7,183 |
|
|
|
715,499 |
|
Mine Safety Appliances Co. |
|
|
9,700 |
|
|
|
390,328 |
|
Mueller Industries, Inc. |
|
|
1,865 |
|
|
|
79,430 |
|
NACCO Industries, Inc., Class A |
|
|
6,186 |
|
|
|
719,123 |
|
Park-Ohio Holdings Corp.* |
|
|
9,325 |
|
|
|
177,455 |
|
Portfolio Recovery Associates, Inc.* |
|
|
4,800 |
|
|
|
438,048 |
|
Proto Labs, Inc.* |
|
|
8,096 |
|
|
|
232,841 |
|
RBC Bearings, Inc.* |
|
|
12,186 |
|
|
|
576,398 |
|
Robbins & Myers, Inc. |
|
|
9,455 |
|
|
|
395,408 |
|
Spirit Airlines, Inc.* |
|
|
28,727 |
|
|
|
559,027 |
|
Standex International Corp. |
|
|
2,665 |
|
|
|
113,449 |
|
Titan Machinery, Inc.* |
|
|
14,152 |
|
|
|
429,796 |
|
Triumph Group, Inc. |
|
|
34,310 |
|
|
|
1,930,624 |
|
United Stationers, Inc. |
|
|
12,071 |
|
|
|
325,313 |
|
|
|
|
|
|
|
|
|
|
|
|
Shares |
|
|
Value |
|
Wabtec Corp. |
|
|
35,295 |
|
|
$ |
2,753,363 |
|
Watsco, Inc. |
|
|
15,279 |
|
|
|
1,127,590 |
|
Wesco Aircraft Holdings, Inc.*,1 |
|
|
61,230 |
|
|
|
779,458 |
|
Westport Innovations, Inc.* |
|
|
19,568 |
|
|
|
719,124 |
|
Total Industrials |
|
|
|
|
|
|
34,444,826 |
|
Information Technology - 19.5% |
|
|
|
|
|
|
|
|
3D Systems Corp.*,1 |
|
|
19,215 |
|
|
|
656,000 |
|
Allot Communications, Ltd.* |
|
|
54,740 |
|
|
|
1,525,056 |
|
Amkor Technology, Inc.* |
|
|
8,354 |
|
|
|
40,768 |
|
Ancestry.com, Inc.* |
|
|
6,795 |
|
|
|
187,066 |
|
Angies List, Inc.* |
|
|
48,303 |
|
|
|
765,120 |
|
Anixter International, Inc. |
|
|
23,282 |
|
|
|
1,235,110 |
|
Applied Micro Circuits Corp.* |
|
|
10,005 |
|
|
|
57,229 |
|
Arris Group, Inc.* |
|
|
16,300 |
|
|
|
226,733 |
|
Aspen Technology, Inc.* |
|
|
27,698 |
|
|
|
641,209 |
|
Bankrate, Inc.*,1 |
|
|
28,490 |
|
|
|
523,931 |
|
Bazaarvoice, Inc.* |
|
|
5,273 |
|
|
|
95,969 |
|
CACI International, Inc., Class A* |
|
|
17,294 |
|
|
|
951,516 |
|
Callidus Software, Inc.* |
|
|
147,382 |
|
|
|
733,962 |
|
Cirrus Logic, Inc.* |
|
|
21,205 |
|
|
|
633,605 |
|
CommVault Systems, Inc.* |
|
|
10,325 |
|
|
|
511,810 |
|
Concur Technologies, Inc.* |
|
|
19,778 |
|
|
|
1,346,882 |
|
Constant Contact, Inc.* |
|
|
9,658 |
|
|
|
172,685 |
|
Cornerstone OnDemand, Inc.* |
|
|
35,450 |
|
|
|
844,065 |
|
CoStar Group, Inc.* |
|
|
13,386 |
|
|
|
1,086,943 |
|
DealerTrack Holdings, Inc.* |
|
|
22,061 |
|
|
|
664,257 |
|
Demand Media, Inc.* |
|
|
15,100 |
|
|
|
169,120 |
|
Echelon Corp.* |
|
|
28,771 |
|
|
|
100,123 |
|
Electronics for Imaging, Inc.* |
|
|
18,180 |
|
|
|
295,425 |
|
Fair Isaac Corp. |
|
|
31,047 |
|
|
|
1,312,667 |
|
FARO Technologies, Inc.* |
|
|
9,041 |
|
|
|
380,445 |
|
Fusion-io, Inc.*,1 |
|
|
20,395 |
|
|
|
426,052 |
|
Heartland Payment Systems, Inc. |
|
|
16,850 |
|
|
|
506,848 |
|
Imperva, Inc.* |
|
|
12,849 |
|
|
|
370,308 |
|
Infoblox, Inc.* |
|
|
16,692 |
|
|
|
382,748 |
|
Inphi Corp.* |
|
|
158,580 |
|
|
|
1,503,338 |
|
InvenSense, Inc.* |
|
|
49,991 |
|
|
|
564,898 |
|
IPG Photonics Corp.* |
|
|
10,570 |
|
|
|
460,746 |
|
Jive Software, Inc.*,1 |
|
|
28,005 |
|
|
|
587,825 |
|
LivePerson, Inc.* |
|
|
111,077 |
|
|
|
2,117,128 |
|
Manhattan Associates, Inc.* |
|
|
11,585 |
|
|
|
529,550 |
|
MAXIMUS, Inc. |
|
|
51,430 |
|
|
|
2,661,502 |
|
Mellanox Technologies, Ltd.* |
|
|
11,302 |
|
|
|
800,634 |
|
MercadoLibre, Inc. |
|
|
7,337 |
|
|
|
556,145 |
|
MicroStrategy, Inc., Class A* |
|
|
1,992 |
|
|
|
258,681 |
|
|
The accompanying
notes are an integral part of these financial statements. 9 |
Managers Special Equity Fund
Schedule
of Portfolio Investments (continued)
|
|
|
|
|
|
|
|
|
|
|
Shares |
|
|
Value |
|
Information Technology - 19.5% (continued) |
|
|
|
|
|
|
|
|
Monotype Imaging Holdings, Inc.* |
|
|
8,325 |
|
|
$ |
139,610 |
|
MTS Systems Corp. |
|
|
10,190 |
|
|
|
392,825 |
|
Netscout Systems, Inc.* |
|
|
15,850 |
|
|
|
342,202 |
|
NetSuite, Inc.* |
|
|
15,804 |
|
|
|
865,585 |
|
Parametric Technology Corp.* |
|
|
25,369 |
|
|
|
531,734 |
|
Plantronics, Inc. |
|
|
11,720 |
|
|
|
391,448 |
|
Plexus Corp.* |
|
|
14,185 |
|
|
|
400,017 |
|
Progress Software Corp.* |
|
|
29,339 |
|
|
|
612,305 |
|
ServiceNow, Inc.* |
|
|
6,500 |
|
|
|
159,900 |
|
ServiceSource International, Inc.* |
|
|
105,650 |
|
|
|
1,463,253 |
|
SolarWinds, Inc.* |
|
|
12,838 |
|
|
|
559,223 |
|
Sourcefire, Inc.* |
|
|
24,658 |
|
|
|
1,267,421 |
|
Splunk, Inc.*,1 |
|
|
11,105 |
|
|
|
312,051 |
|
Stratasys, Inc.* |
|
|
14,643 |
|
|
|
725,561 |
|
Synchronoss Technologies, Inc.* |
|
|
94,470 |
|
|
|
1,744,861 |
|
Syntel, Inc. |
|
|
5,460 |
|
|
|
331,422 |
|
Tangoe, Inc.* |
|
|
179,944 |
|
|
|
3,834,606 |
|
TeleNav, Inc.* |
|
|
22,375 |
|
|
|
137,159 |
|
TiVo, Inc.* |
|
|
30,300 |
|
|
|
250,581 |
|
TNS, Inc.* |
|
|
15,585 |
|
|
|
279,595 |
|
Ultimate Software Group, Inc.* |
|
|
6,484 |
|
|
|
577,854 |
|
Unisys Corp.* |
|
|
33,106 |
|
|
|
647,222 |
|
Velti PLC*,1 |
|
|
59,763 |
|
|
|
388,460 |
|
Websense, Inc.* |
|
|
23,801 |
|
|
|
445,793 |
|
Yelp, Inc.*,1 |
|
|
19,341 |
|
|
|
439,621 |
|
|
|
|
|
|
|
|
|
|
|
|
Shares |
|
|
Value |
|
Youku, Inc., ADR*,1 |
|
|
11,184 |
|
|
$ |
242,469 |
|
Total Information Technology |
|
|
|
|
|
|
44,366,877 |
|
Materials - 2.4% |
|
|
|
|
|
|
|
|
Chemtura Corp.* |
|
|
11,655 |
|
|
|
168,998 |
|
Coeur dAlene Mines Corp.* |
|
|
6,990 |
|
|
|
122,744 |
|
Koppers Holdings, Inc. |
|
|
2,395 |
|
|
|
81,430 |
|
Kraton Performance Polymers, Inc.* |
|
|
54,450 |
|
|
|
1,193,000 |
|
Minerals Technologies, Inc. |
|
|
6,795 |
|
|
|
433,385 |
|
Rockwood Holdings, Inc. |
|
|
35,967 |
|
|
|
1,595,137 |
|
TPC Group, Inc.* |
|
|
25,140 |
|
|
|
928,923 |
|
Worthington Industries, Inc. |
|
|
47,082 |
|
|
|
963,769 |
|
Total Materials |
|
|
|
|
|
|
5,487,386 |
|
Telecommunication Services - 0.0%# |
|
|
|
|
|
|
|
|
Premiere Global Services, Inc.* |
|
|
9,100 |
|
|
|
76,349 |
|
Total Common Stocks (cost $193,629,157) |
|
|
|
|
|
|
218,656,759 |
|
Other Investment Companies - 7.6%2 |
|
|
|
|
|
|
|
|
BNY Mellon Overnight Government Fund, 0.18%3 |
|
|
11,084,567 |
|
|
|
11,084,567 |
|
Dreyfus Cash Management Fund, Institutional Class Shares, 0.08% |
|
|
6,253,891 |
|
|
|
6,253,891 |
|
Total Other Investment Companies (cost $17,338,458) |
|
|
|
|
|
|
17,338,458 |
|
Total Investments - 103.7% (cost $210,967,615) |
|
|
|
|
|
|
235,995,217 |
|
Other Assets, less Liabilities - (3.7)% |
|
|
|
|
|
|
(8,419,727 |
) |
Net Assets - 100.0% |
|
|
|
|
|
$ |
227,575,490 |
|
|
The accompanying
notes are an integral part of these financial statements. 10 |
Notes to Schedule of Portfolio Investments (unaudited)
The following footnotes and
abbreviations should be read in conjunction with the Schedule of Portfolio Investments previously presented in this report.
Based on the approximate cost of investments of $215,577,782 for Federal income tax purposes at June 30, 2012, the aggregate gross
unrealized appreciation and depreciation were $29,697,940 and $9,280,505, respectively, resulting in net unrealized appreciation of investments of $20,417,535.
* |
Non-income-producing security. |
# |
Rounds to less than 0.1%. |
1 |
Some or all of these shares were out on loan to various brokers as of June 30, 2012, amounting to a market value of $10,209,032, or approximately
4.5% of net assets. |
2 |
Yield shown for an investment company represents the June 30, 2012, seven-day average yield, which refers to the sum of the previous seven
days dividends paid, expressed as an annual percentage. |
3 |
Collateral received from brokers for securities lending was invested in this short-term investment. |
As of June 30, 2012, all investments in the Fund were all valued using Level 1 inputs. For a detailed break-out of the common stocks
by major industry classification, please refer to the Schedule of Portfolio Investments previously presented in this report. (See Note 1(a) in the Notes to Financial Statements.)
For the six months ended June 30, 2012, the Fund had no transfers between Level 1 and Level 2 from the beginning of the reporting
period.
Investment Abbreviations and Definitions:
ADR: ADR after the name of a holding stands for American Depositary Receipt, representing ownership of foreign securities on deposit with
a domestic custodian bank. The value of the ADR security is determined or significantly influenced by trading on exchanges not located in the United States or Canada. Sponsored ADRs are initiated by the underlying foreign company.
|
The accompanying
notes are an integral part of these financial statements. 11 |
Statement of Assets and Liabilities
June 30, 2012 (unaudited)
|
|
|
|
|
Assets: |
|
|
|
|
Investments at value* (including securities on loan valued at $10,209,032) |
|
$ |
235,995,217 |
|
Receivable for investments sold |
|
|
8,790,518 |
|
Dividends, interest and other receivables |
|
|
8,897 |
|
Receivable for Fund shares sold |
|
|
73,821 |
|
Receivable from affiliate |
|
|
36,310 |
|
Prepaid expenses |
|
|
38,599 |
|
Total assets |
|
|
244,943,362 |
|
Liabilities: |
|
|
|
|
Payable upon return of securities loaned |
|
|
11,084,567 |
|
Payable for investments purchased |
|
|
5,581,932 |
|
Payable for fund shares repurchased |
|
|
317,812 |
|
Accrued expenses: |
|
|
|
|
Investment advisory and management fees |
|
|
164,290 |
|
Administrative fees |
|
|
45,636 |
|
Trustee fees |
|
|
1,179 |
|
Other |
|
|
172,456 |
|
Total liabilities |
|
|
17,367,872 |
|
|
|
Net Assets |
|
$ |
227,575,490 |
|
Net Assets Represent: |
|
|
|
|
Paid-in capital |
|
$ |
423,999,036 |
|
Undistributed net investment loss |
|
|
(942,906 |
) |
Accumulated net realized loss from investments |
|
|
(220,508,242 |
) |
Net unrealized appreciation of investments |
|
|
25,027,602 |
|
Net Assets |
|
$ |
227,575,490 |
|
Managers Shares: |
|
|
|
|
Net Assets |
|
$ |
210,579,453 |
|
Shares outstanding |
|
|
3,577,122 |
|
Net asset value, offering and redemption price per share |
|
$ |
58.87 |
|
Institutional Class: |
|
|
|
|
Net Assets |
|
$ |
16,996,037 |
|
Shares outstanding |
|
|
283,442 |
|
Net asset value, offering and redemption price per share |
|
$ |
59.96 |
|
* Investments at cost |
|
$ |
210,967,615 |
|
|
The accompanying
notes are an integral part of these financial statements. 12 |
Statement of Operations
For the six months ended June 30, 2012 (unaudited)
|
|
|
|
|
Investment Income: |
|
|
|
|
Dividend income |
|
$ |
640,201 |
|
Securities lending income |
|
|
169,882 |
|
Interest income |
|
|
690 |
|
Total investment income |
|
|
810,773 |
|
Expenses: |
|
|
|
|
Investment advisory and management fees |
|
|
1,146,685 |
|
Administrative fees |
|
|
318,526 |
|
Transfer agent |
|
|
335,996 |
|
Custodian |
|
|
59,553 |
|
Registration fees |
|
|
32,476 |
|
Professional fees |
|
|
30,823 |
|
Reports to shareholders |
|
|
23,309 |
|
Trustees fees and expenses |
|
|
11,519 |
|
Miscellaneous |
|
|
5,673 |
|
Total expenses before offsets |
|
|
1,964,560 |
|
Expense reimbursements |
|
|
(251,139 |
) |
Expense reductions |
|
|
(13,617 |
) |
Net expenses |
|
|
1,699,804 |
|
|
|
Net investment loss |
|
|
(889,031 |
) |
Net Realized and Unrealized Gain (Loss): |
|
|
|
|
Net realized gain on investments |
|
|
20,230,363 |
|
Net change in unrealized appreciation (depreciation) of investments |
|
|
1,247,697 |
|
Net realized and unrealized gain |
|
|
21,478,060 |
|
|
|
Net increase in net assets resulting from operations |
|
$ |
20,589,029 |
|
|
The accompanying
notes are an integral part of these financial statements. 13 |
Statements of Changes in Net Assets
For the six months ended June 30, 2012 (unaudited) and the year ended December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
2012 |
|
|
2011 |
|
Increase (Decrease) in Net Assets From Operations: |
|
|
|
|
|
|
|
|
Net investment loss |
|
$ |
(889,031 |
) |
|
$ |
(2,850,490 |
) |
Net realized gain on investments |
|
|
20,230,363 |
|
|
|
42,550,826 |
|
Net change in unrealized appreciation (depreciation) of investments |
|
|
1,247,697 |
|
|
|
(37,008,078 |
) |
Net increase in net assets resulting from operations |
|
|
20,589,029 |
|
|
|
2,692,258 |
|
From Capital Share Transactions: |
|
|
|
|
|
|
|
|
Managers Class: |
|
|
|
|
|
|
|
|
Proceeds from sale of shares |
|
|
10,732,065 |
|
|
|
152,829,719 |
|
Cost of shares repurchased |
|
|
(63,401,143 |
) |
|
|
(189,754,386 |
) |
Net decrease from Managers Class share transactions |
|
|
(52,669,078 |
) |
|
|
(36,924,667 |
) |
Institutional Class: |
|
|
|
|
|
|
|
|
Proceeds from sale of shares |
|
|
3,256,140 |
|
|
|
11,950,135 |
|
Cost of shares repurchased |
|
|
(1,420,009 |
) |
|
|
(3,388,450 |
) |
Net increase from Institutional Class share transactions |
|
|
1,836,131 |
|
|
|
8,561,685 |
|
Net decrease from capital share transactions |
|
|
(50,832,947 |
) |
|
|
(28,362,982 |
) |
Total decrease in net assets |
|
|
(30,243,918 |
) |
|
|
(25,670,724 |
) |
Net Assets: |
|
|
|
|
|
|
|
|
Beginning of period |
|
|
257,819,408 |
|
|
|
283,490,132 |
|
End of period |
|
$ |
227,575,490 |
|
|
$ |
257,819,408 |
|
End of period undistributed net investment loss |
|
$ |
(942,906 |
) |
|
$ |
(53,875 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Share Transactions: |
|
|
|
|
|
|
|
|
Managers Class: |
|
|
|
|
|
|
|
|
Sale of shares |
|
|
180,041 |
|
|
|
2,679,236 |
|
Shares repurchased |
|
|
(1,076,841 |
) |
|
|
(3,492,876 |
) |
Net decrease in shares |
|
|
(896,800 |
) |
|
|
(813,640 |
) |
Institutional Class: |
|
|
|
|
|
|
|
|
Sale of shares |
|
|
55,020 |
|
|
|
224,397 |
|
Shares repurchased |
|
|
(23,350 |
) |
|
|
(62,207 |
) |
Net increase in shares |
|
|
31,670 |
|
|
|
162,190 |
|
|
The accompanying
notes are an integral part of these financial statements. 14 |
Managers Special Equity Fund
Financial Highlights
For a share outstanding throughout each period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Managers Class |
|
For the six months ended June 30, 2012 (unaudited) |
|
|
For the year ended December 31, |
|
|
|
2011 |
|
|
2010 |
|
|
2009 |
|
|
2008 |
|
|
2007 |
|
Net Asset Value, Beginning of Period |
|
$ |
54.51 |
|
|
$ |
52.71 |
|
|
$ |
39.60 |
|
|
$ |
30.28 |
|
|
$ |
64.27 |
|
|
$ |
82.96 |
|
Income from Investment Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment loss1 |
|
|
(0.21 |
) |
|
|
(0.50 |
) |
|
|
(0.41 |
) |
|
|
(0.34 |
) |
|
|
(0.28 |
) |
|
|
(0.51 |
) |
Net realized and unrealized gain (loss) on investments1 |
|
|
4.57 |
|
|
|
2.30 |
|
|
|
13.52 |
|
|
|
9.66 |
|
|
|
(27.93 |
) |
|
|
0.55 |
|
Total from investment operations |
|
|
4.36 |
|
|
|
1.80 |
|
|
|
13.11 |
|
|
|
9.32 |
|
|
|
(28.21 |
) |
|
|
0.04 |
|
Less Distribution to Shareholder from: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net realized gain from investments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(5.78 |
) |
|
|
(18.73 |
) |
Net Asset Value, End of Period |
|
$ |
58.87 |
|
|
$ |
54.51 |
|
|
$ |
52.71 |
|
|
$ |
39.60 |
|
|
$ |
30.28 |
|
|
$ |
64.27 |
|
Total Return2 |
|
|
8.00 |
%4,6 |
|
|
3.41 |
%4 |
|
|
33.11 |
% |
|
|
30.78 |
% |
|
|
(43.49 |
)% |
|
|
(0.60 |
)% |
Ratio of net expenses to average net assets |
|
|
1.35 |
%7 |
|
|
1.37 |
%5 |
|
|
1.48 |
% |
|
|
1.58 |
% |
|
|
1.48 |
% |
|
|
1.43 |
% |
Ratio of net investment loss to average net assets2 |
|
|
(0.70 |
)%7 |
|
|
(0.89 |
)% |
|
|
(0.95 |
)% |
|
|
(1.08 |
)% |
|
|
(0.52 |
)% |
|
|
(0.59 |
)% |
Portfolio turnover |
|
|
56 |
%6 |
|
|
126 |
% |
|
|
138 |
% |
|
|
186 |
% |
|
|
138 |
% |
|
|
67 |
% |
Net assets at end of period (000s omitted) |
|
$ |
210,579 |
|
|
$ |
243,858 |
|
|
$ |
278,701 |
|
|
$ |
221,159 |
|
|
$ |
352,106 |
|
|
$ |
1,668,031 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratios absent expense offsets:3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratio of total expenses to average net assets |
|
|
1.56 |
%7 |
|
|
1.54 |
% |
|
|
1.55 |
% |
|
|
1.61 |
% |
|
|
1.51 |
% |
|
|
1.46 |
% |
Ratio of net investment loss to average net assets |
|
|
(0.91 |
)%7 |
|
|
(1.06 |
)% |
|
|
(1.02 |
)% |
|
|
(1.11 |
)% |
|
|
(0.55 |
)% |
|
|
(0.62 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Institutional Class |
|
For the six months ended June 30, 2012 (unaudited) |
|
|
For the year ended December 31, |
|
|
|
2011 |
|
|
2010 |
|
|
2009 |
|
|
2008 |
|
|
2007 |
|
Net Asset Value, Beginning of Period |
|
$ |
55.45 |
|
|
$ |
53.43 |
|
|
$ |
40.04 |
|
|
$ |
30.56 |
|
|
$ |
64.71 |
|
|
$ |
83.56 |
|
Income from Investment Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment loss1 |
|
|
(0.14 |
) |
|
|
(0.29 |
) |
|
|
(0.30 |
) |
|
|
(0.26 |
) |
|
|
(0.15 |
) |
|
|
(0.32 |
) |
Net realized and unrealized gain (loss) on investments1 |
|
|
4.65 |
|
|
|
2.31 |
|
|
|
13.69 |
|
|
|
9.74 |
|
|
|
(28.16 |
) |
|
|
0.52 |
|
Total from investment operations |
|
|
4.51 |
|
|
|
2.02 |
|
|
|
13.39 |
|
|
|
9.48 |
|
|
|
(28.31 |
) |
|
|
0.20 |
|
Less Distributions to Shareholders from: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net realized and unrealized loss on investments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(5.84 |
) |
|
|
(19.05 |
) |
Net Asset Value, End of Period |
|
$ |
59.96 |
|
|
$ |
55.45 |
|
|
$ |
53.43 |
|
|
$ |
40.04 |
|
|
$ |
30.56 |
|
|
$ |
64.71 |
|
Total Return2 |
|
|
8.13 |
%6 |
|
|
3.78 |
%4 |
|
|
33.44 |
%4 |
|
|
31.02 |
%4 |
|
|
(43.35 |
)% |
|
|
(0.39 |
)% |
Ratio of net expenses to average net assets |
|
|
1.10 |
%7 |
|
|
1.12 |
%5 |
|
|
1.23 |
% |
|
|
1.33 |
% |
|
|
1.23 |
% |
|
|
1.20 |
% |
Ratio of net investment loss to average net assets2 |
|
|
(0.45 |
)%7 |
|
|
(0.53 |
)% |
|
|
(0.70 |
)% |
|
|
(0.83 |
)% |
|
|
(0.29 |
)% |
|
|
(0.36 |
)% |
Portfolio turnover |
|
|
56 |
%6 |
|
|
126 |
% |
|
|
138 |
% |
|
|
186 |
% |
|
|
138 |
% |
|
|
67 |
% |
Net assets at end of period (000s omitted) |
|
$ |
16,996 |
|
|
$ |
13,961 |
|
|
$ |
4,786 |
|
|
$ |
8,028 |
|
|
$ |
92,439 |
|
|
$ |
247,396 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratios absent expense offsets:3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratio of total expenses to average net assets |
|
|
1.31 |
%7 |
|
|
1.29 |
% |
|
|
1.30 |
% |
|
|
1.36 |
% |
|
|
1.26 |
% |
|
|
1.23 |
% |
Ratio of net investment loss to average net assets |
|
|
(0.66 |
)%7 |
|
|
(0.70 |
)% |
|
|
(0.77 |
)% |
|
|
(0.86 |
)% |
|
|
(0.32 |
)% |
|
|
(0.39 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes to Financial Highlights (unaudited)
The following footnotes should be
read in conjunction with the Financial Highlights of the Fund previously presented in this report.
1 |
Per share numbers
have been calculated using average shares. |
2 |
Total returns and net investment income would have been lower had certain expenses not been reduced. (See Note 1(c) of Notes to Financial
Statements.) |
3 |
Excludes the impact of expense reimbursements or fee waivers and expense reductions such as brokerage credits, but includes expense repayments and
non-reimbursable expenses, if any, such as interest and taxes. (See Note 1(c) of Notes to Financial Statements.) |
4 |
The Total Return is based on the Financial Statement Net Asset Values as shown above. |
5 |
Effective July 1, 2011, as described in the current prospectus, the Funds expense cap was reduced to 1.11% from 1.14%. For the period
April 1, 2011 through June 30, 2011, the Funds expense cap was 1.14%. From January 1, 2011 through March 31, 2011, the Funds expense cap was 1.19%. The expense ratio shown reflects the weighted average expense ratio
for the full year ended December 31, 2011. |
Notes to Financial Statements
June 30, 2012 (unaudited)
1. |
Summary of Significant Accounting Policies |
The Managers Funds (the Trust) is an open-end management investment company, organized as a Massachusetts business trust, and registered under the Investment Company Act of 1940, as amended
(the 1940 Act). Currently, the Trust consists of a number of different funds, each having distinct investment management objectives, strategies, risks and policies. Included in this report is the Managers Special Equity Fund
(Special Equity or the Fund).
The Fund offers both Managers Class shares and Institutional Class
shares. The Institutional Class shares, which are designed primarily for institutional investors that meet certain administrative and servicing criteria, have a minimum investment of $2,500,000. Managers Class shares are offered to all other
investors. Each class represents an interest in the same assets of the Fund and the classes are identical except for class specific expenses related to shareholder activity. Each class has equal voting privileges except that each class has exclusive
voting rights with respect to its services and/or distribution plan. Please refer to a current prospectus for additional information on each share class.
The Funds financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP), which require management to make
estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting
period. Actual results could differ from those estimates and such differences could be material. The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements:
a. |
Valuation of Investments |
Equity securities traded on a domestic or international securities exchange are valued at the last quoted sale price, or, lacking any sales, at the last quoted bid price. Over-the-counter securities are
valued at the Nasdaq Official Closing Price, if one is available. Lacking any sales, over-the-counter securities are valued at the last quoted bid price. The Funds investments are generally valued based on market quotations provided by
third-party pricing services approved by the Board of Trustees of the Fund (the Board).
Short-term investments
having a remaining maturity of 60 days or less are generally valued at amortized cost, which approximates market value. Investments in other open-end regulated investment companies are valued at their end of day net asset value per share.
Under certain circumstances, the value of certain Fund investments (including derivatives) may be based on an evaluation of
fair value, pursuant to procedures established by and under the general supervision of the Board. The Pricing Committee is the committee formed by the Board to make fair value determinations for such investments. When determining the fair value of
an investment, the Pricing Committee seeks to determine the price that the Fund might reasonably expect to receive from a current sale of that investment in an arms-length transaction. Fair value determinations shall be based upon
consideration of all available facts and information, including, but not limited to (i) attributes specific to the investment;
(ii) fundamental analytical data and press releases relating to the investment and its issuer; (iii) the value of comparable securities or relevant financial instruments, including
derivative securities, traded on other markets or among dealers; and (iv) other factors, such as future cash flows, interest rates, yield curves, volatilities, credit risks and/or default rates. The Board will be presented with a quarterly
report comparing fair values determined by the Pricing Committee against subsequent market valuations for those securities. The values assigned to fair value investments are based on available information and do not necessarily represent amounts
that might ultimately be realized, since such amounts depend on future developments inherent in long-term investments. Further, because of the inherent uncertainty of valuation, those estimated values may differ significantly from the values that
would have been used had a ready market for the investments existed, and the differences could be material. The Fund may use the fair value of a portfolio investment to calculate its net asset value (NAV) when, for example,
(1) market quotations are not readily available because a portfolio investment is not traded in a public market or the principal market in which the investment trades is closed, (2) trading in a portfolio investment is suspended and has
not resumed before the Fund calculates its NAV, (3) a significant event affecting the value of a portfolio investment is determined to have occurred between the time of the market quotation provided for a portfolio investment and the time as of
which the Fund calculates its NAV, (4) an investments price has remained unchanged over a period of time (often referred to as a stale price), or (5) Managers Investment Group LLC (the Investment Manager)
determines that a market quotation is inaccurate. Portfolio investments that trade primarily on foreign markets are priced based upon the market quotation of such securities as of the close of their respective principal markets, as adjusted to
reflect the Investment Managers determination of the impact of events occurring subsequent to the close of such markets but prior to the time as of which the Fund calculates its NAV. Under certain circumstances, the Investment Manager may
adjust such prices based on its determination of the impact of events occurring subsequent to the close of such markets but prior to the time as of which the Fund calculates its NAV. The Fund may invest in securities that may be thinly traded. The
Board has adopted procedures to adjust prices of thinly traded securities that are judged to be stale so that they reflect fair value. An investment valued on the basis of its fair value may be valued at a price higher or lower than available market
quotations. An investments valuation may differ depending on the method used and the factors considered in determining value according to the Funds fair value procedures.
U.S. GAAP defines fair value as the price that a Fund 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 also 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. 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 Fund. Unobservable inputs reflect the Funds own assumptions about the
Notes to Financial Statements (continued)
assumptions that market participants would use in pricing the asset or liability developed 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 inputs are quoted prices in active markets for identical investments (e.g., equity
securities, open-end investment companies)
Level 2 other observable inputs (including, but not limited to: quoted
prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such
as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market corroborated inputs) (e.g., debt securities, government securities, foreign securities utilizing international fair
value pricing, broker-quoted securities, fair valued securities with observable inputs)
Level 3 inputs are
significant unobservable inputs (including the Funds own assumptions used to determine the fair value of investments) (e.g., fair valued securities with unobservable inputs)
Changes in inputs or methodologies used for valuing investments may result in a transfer in or out of levels within the fair value
hierarchy. Transfers between different levels in the fair value hierarchy are deemed to have occurred as of the beginning of the reporting period. The inputs or methodologies used for valuing investments are not necessarily an indication of the risk
associated with investing in those investments.
Security transactions are accounted for as of trade date. Realized gains and losses on securities sold are determined on the basis of identified cost.
c. |
Investment Income and Expenses |
Dividend income is recorded on the ex-dividend date. Dividend income on foreign securities is recorded net of any withholding tax. Interest income, which includes amortization of premium and accretion of
discount on debt securities, is accrued as earned. Non-cash dividends included in dividend income, if any, are reported at the fair market value of the securities received. Other income and expenses are recorded on an accrual basis. Expenses that
cannot be directly attributed to a fund are apportioned among the Funds in the Trust and in some cases other affiliated funds based upon their relative average net assets or number of shareholders. Investment income, realized and unrealized capital
gains and losses, the common expenses of the Fund and certain Fund level expense reductions, if any, are allocated on a pro-rata basis to each class based on the relative net assets of each class to the total net assets of the Fund.
The Fund had certain portfolio trades directed to various brokers, under a brokerage recapture program, which paid a portion of the
Funds expenses. For the six months ended June 30, 2012, the amount by which the Funds expenses were reduced and the impact on the expense ratio if any, were as follows: $13,583 or 0.01%.
The Fund has a balance credit agreement with The Bank of New York Mellon
(BNYM), the Funds custodian, whereby the Fund is credited with an interest factor equal to 0.75% below the effective 90-day T-Bill rate for account balances left uninvested overnight. If the T-Bill rate falls below 0.75%, no
credits will be earned. These credits serve to reduce custody expenses that otherwise would be charged to the Fund. For the six months ended June 30, 2012, the custodian expense was not reduced.
Overdrafts will cause a reduction of any earnings credits, computed at 2% above the Federal funds rate on the day of the overdraft. For
the six months ended June 30, 2012, overdraft fees equaled $1.
The Trust also has a balance credit arrangement with its
Transfer Agent, BNY Mellon Investment Servicing (US) Inc., whereby earnings credits are used to offset banking charges and other out-of-pocket expenses. For the six months ended June 30, 2012, the transfer agent expense was reduced by $34.
Total returns and net investment income for the Fund would have been lower had certain expenses not been offset. Total
expenses before offsets exclude the impact of expense reimbursements or fee waivers and expense reductions such as brokerage recapture credits, but include non-reimbursable expenses, if any, such as interest and taxes.
d. |
Dividends and Distributions |
Dividends resulting from net investment income and distributions of capital gains, if any, normally will be declared and paid annually in December and when required for Federal excise tax purposes. Income
and capital gain distributions are determined in accordance with Federal income tax regulations, which may differ from U.S. GAAP. These differences are primarily due to differing treatments for losses deferred due to wash sales, equalization
accounting for tax purposes and market discount transactions. Permanent book and tax basis differences, if any, relating to shareholder distributions will result in reclassifications to paid-in capital.
The Fund intends to comply with the requirements under
Subchapter M of the Internal Revenue Code of 1986, as amended, to distribute substantially all of its taxable income and gains to its shareholders and to meet certain diversification and income
requirements with respect to investment companies. Therefore, no provision for Federal income or excise tax is included in the accompanying financial statements.
Additionally, based on the Funds understanding of the tax rules and rates related to income, gains and transactions for the foreign jurisdictions in which it invests, the Fund will provide for
foreign taxes, and where appropriate, deferred foreign taxes.
Management has analyzed the Funds tax positions taken on
federal income tax returns for all open tax years (tax years ended December 31, 2008-2011), and has concluded that no provision for federal income tax is required in the Funds financial statements. Additionally, the Fund is not aware of
any tax position for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next twelve months.
Notes to Financial Statements (continued)
Under the Regulated Investment Company Modernization Act of 2010 (the Act),
post-enactment capital losses may be carried forward for an unlimited time period. However, any new losses incurred will be required to be utilized prior to any loss carryovers incurred in pre-enactment taxable years, which generally expire eight
years following the close of the taxable year in which they were incurred. As a result of this ordering rule, pre-enactment capital loss carryovers may be more likely to expire unused. Additionally, post-enactment capital losses that are carried
forward retain their tax character as either short-term or long-term capital losses rather than being considered all short-term as under previous law.
f. |
Capital Loss Carryover and Deferrals |
As of June 30, 2012, the Fund had accumulated net realized capital loss carryovers from security transactions for Federal income tax purposes as shown in the following chart. These amounts may be
used to offset realized capital gains, if any, through the expiration date listed or in the case of post-enactment losses, for an unlimited time period.
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Capital Loss Carryover Amounts |
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Expires |
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Short-Term |
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Long-Term |
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December 31, |
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(Pre-Enactment) |
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$ |
51,507,571 |
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2016 |
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(Pre-Enactment) |
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183,621,777 |
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2017 |
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Totals |
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$ |
235,129,348 |
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The Trusts Declaration of Trust authorizes for each series the issuance of an unlimited number of shares of beneficial interest,
without par value. The Fund records sales and repurchases of its capital stock on the trade date. The cost of securities contributed to the Fund in connection with the issuance of shares is based on the valuation of those securities in accordance
with the Funds policy on investment valuation. Dividends and distributions to shareholders are recorded on the ex-dividend date.
At June 30, 2012, certain unaffiliated shareholders of record, specifically omnibus accounts, individually or collectively held greater than 10% of the outstanding shares of the Fund as follows: two
collectively own 53%. Transactions by these shareholders may have a material impact on the Fund.
2. |
Agreements and Transactions with Affiliates |
The Trust has entered into an Investment Management Agreement under which the Investment Manager, a subsidiary of Affiliated Managers Group, Inc. (AMG), serves as investment manager to the
Fund and is responsible for the Funds overall administration and operations. The Investment Manager selects subadvisors for the Fund (subject to Board approval) and monitors the subadvisors investment performance, security holdings and
investment strategies. The Funds investment portfolio is managed by one or more portfolio managers who serves pursuant to a subadvisory agreement with the Investment Manager.
Investment management fees are paid directly by the Fund to the Investment Manager based on average daily net assets. For the six months
ended June 30, 2012 the investment management fee rate, as a percentage of average daily net assets, was 0.90%.
At a meeting held on June 9-10, 2011, the Board approved a new contractual expense
limitation with respect to the Fund. Effective July 1, 2011, the Investment Manager has contractually agreed, until at least May 1, 2013, to waive management fees and/or reimburse Fund expenses, in order to limit total annual Fund
operating expenses after fee waiver and expense reimbursements (exclusive of taxes, interest (including interest incurred in connection with bank and custody overdrafts), shareholder servicing fees, brokerage commissions and other transaction costs,
acquired fund fees and expenses, and extraordinary expenses) to 1.11% of the Funds average daily net assets. For the period April 1, 2011 to June 30, 2011, the Fund had a contractual expense limitation of 1.14%. From January 1,
2011 to April 1, 2011, the Funds contractual expense limitation was 1.19%.
The Fund is obligated to repay the
Investment Manager such amounts waived, paid or reimbursed in future years provided that the repayment occurs within thirty-six (36) months after the waiver or reimbursement and that such repayment would not cause the Funds total
operating expenses in any such future year to exceed the Funds expense cap. For the six months ended June 30, 2012, the Fund made no such repayments to the Investment Manager. For the six months ended June 30, 2012, the Funds
components of reimbursement are detailed in the following chart:
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Reimbursement Available - 12/31/11 |
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$ |
550,121 |
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Additional Reimbursements |
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251,139 |
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Repayments |
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Expired Reimbursements |
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Reimbursement Available - 06/30/12 |
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$ |
801,260 |
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The Fund has entered into an Administration and Shareholder Servicing Agreement under which the
Investment Manager serves as the Funds administrator (the Administrator) and is responsible for all aspects of managing the Funds operations, including administration and shareholder services to the Fund, its shareholders,
and certain institutions, such as bank trust departments, broker-dealers and registered investment advisers, that advise or act as an intermediary with the Funds shareholders. The Fund pays a fee to the Administrator at the rate of
0.25% per annum of the Funds average daily net assets for this service.
The aggregate annual retainer paid to
each Independent Trustee of the Board is $80,000, plus $5,000 or $2,500 for each regular or special meeting attended, respectively. The Independent Chairman of the Trusts receives an additional payment of $20,000 per year. The Chairman of the Audit
Committee receives an additional payment of $8,000 per year. The Trustees fees and expenses are allocated among all of the funds for which the Investment Manager serves as the advisor (the Managers Funds) based on the relative net
assets of such funds. The Trustees fees and expenses shown in the financial statements represents the Funds allocated portion of the total fees and expenses paid by the Managers Funds.
The Fund is distributed by Managers Distributors, Inc. (the Distributor or MDI), a wholly-owned subsidiary of
the Investment Manager. MDI serves as the distributor and underwriter
Notes to Financial Statements (continued)
for the Fund and is a registered broker-dealer and member of the Financial Industry Regulatory Authority, Inc. (FINRA). Shares of the Fund will be continuously offered and will be
sold directly to prospective purchasers through brokers, dealers or other financial intermediaries who have executed selling agreements with MDI. Subject to the compensation arrangement discussed below, generally MDI bears all or a portion of the
expenses of providing services pursuant to the distribution agreement, including the payment of the expenses relating to the distribution of prospectuses for sales purposes and any advertising or sales literature. Certain Trustees and Officers of
the Fund are Officers and/or Directors of the Investment Manager, AMG and/or the Distributor.
The Securities and Exchange
Commission granted an exemptive order that permits the Fund to lend and borrow money for certain temporary purposes directly to and from other eligible Managers Funds. Participation in this interfund lending program is voluntary for both borrowing
and lending Funds, and an interfund loan is only made if it benefits each participating fund. The Investment Manager administers the program according to procedures approved by the Board, and the Board monitors the operation of the program. An
interfund loan must comply with certain conditions set out in the exemptive order, which are designed to assure fairness and protect all participating Funds. For the six months ended June 30, 2012, the Fund lent to other Managers Funds varying
amounts up to $2,271,746 for 5 days earning interest of $282. The interest earned is included in the Statement of Operations as interest income. For the same period, the Fund did not borrow from any other Managers Funds.
During the six months ended June 30, 2012, the Fund executed the following transactions at the closing price of the security and
with no commissions under Rule 17a-7 procedures approved by the Board of Trustees:
June 7, 2012 sold 1,455
shares of Titan Machinery, Inc. at $27.97 to Lord Abbett Small Cap Fund.
June 26, 2012 bought 2,554 shares of
Portfolio Recovery Assoc. at $85.28 from Lord Abbett Small Cap Blend Fund.
3. |
Purchases and Sales of Securities |
Purchases and sales of securities (excluding short-term securities and U.S. Government obligations) for the six months ended June 30, 2012, were $138,430,651 and $191,831,862, respectively. There
were no purchases or sales of U.S. Government Obligations for the Fund.
4. |
Portfolio Securities Loaned |
The Fund participates in a securities lending program offered by BNYM (the Program), providing for the lending of securities to qualified brokers. Securities lending income include earnings of
such temporary cash investments, plus or minus any rebate to a borrower. These earnings (after any rebate) are then divided between BNYM, as a fee for its services under the program, and the Fund, according to agreed-upon rates. Collateral on all
securities loaned is accepted in cash and/or government securities and is maintained at a minimum level of 102% (105% in the case of certain foreign securities) of the market value, plus interest, if applicable, of investments on loan. It is the
Funds policy to obtain additional
collateral from or return excess collateral to the borrower by the end of the next business day, following the valuation date of the securities loaned. Therefore, the value of the collateral held
may be temporarily less than the value of the securities on loan. Lending securities entails a risk of loss to the Fund if and to the extent that the market value of the securities loaned were to increase and the borrower did not increase the
collateral accordingly, and the borrower fails to return the securities. Under the terms of the Program, the Fund is indemnified for such losses by BNYM. The Fund bears the risk of any deficiency in the amount of the collateral available for return
to the borrower due to any loss on the collateral invested. Collateral received in the form of cash is invested temporarily in the BNY Mellon Overnight Government Fund, formerly BNY Institutional Cash Reserves Fund (the ICRF), or other
short-term investments as defined in the Securities Lending Agreement with BNYM.
Effective August 2, 2010, the Trust,
on behalf of the Fund, entered into an agreement with BNYM and the Bank of New York Mellon Corporation (BNYMC) with respect to the Funds position in the ICRF, pursuant to which (i) BNYMC would support the value of certain
defaulted securities issued by Lehman Brothers Holdings, Inc. (the Lehman Securities) and held by Series B of the ICRF, and (ii) once certain conditions were met, BNYMC would purchase the defaulted securities from the Fund. On
October 17, 2011, after certifying that the Fund had met all necessary conditions, BNYMC purchased the Lehman Securities from the Fund at a predetermined price, which represented a premium over the fair market value of the Lehman Securities at
that date.
5. |
Commitments and Contingencies |
In the normal course of business, the Fund may enter into contracts and agreements that contain a variety of representations and warranties, which provide general indemnifications. The maximum exposure to
the Fund under these arrangements is unknown, as this would involve future claims that may be made against the Fund that have not yet occurred. However, based on experience, the Fund has had no prior claims or losses and expects the risk of material
loss to be remote.
6. |
New Accounting Pronouncements |
In December 2011, the FASB issued ASU No. 2011-11, Disclosures about Offsetting Assets and Liabilities. ASU 2011- 11 requires disclosures to make financial statements that are prepared
under U.S. GAAP more comparable to those prepared under IFRS. The new disclosure requirements mandate that entities disclose both gross and net information about instruments and transactions eligible for offset in the statement of assets and
liabilities as well as instruments and transactions subject to an agreement similar to a master netting arrangement. In addition, ASU 2011-11 requires disclosure of collateral received and posted in connection with master netting agreements or
similar arrangements. New disclosures are required for annual reporting periods beginning on or after January 1, 2013, and interim periods within those annual periods. Management is evaluating the impact of ASU 2011-11 on the Funds
financial statements and disclosures.
Notes to Financial Statements (continued)
The Fund has determined that no additional material events or transactions occurred through the issuance of the Funds financial
statements, which require additional disclosure in or adjustment of the Funds financial statements.
Annual Renewal of Investment Advisory Agreement (unaudited)
On June 21-22, 2012, the Board of Trustees, including a majority
of the Trustees who are not interested persons of the Trust (the Independent Trustees), approved the Investment Management Agreement with the Investment Manager for the Managers Special Equity Fund (the Fund) and
the Subadvisory Agreement for each Subadvisor of the Fund. The Independent Trustees were separately represented by independent counsel in connection with their consideration of the approval of these agreements. In considering the Investment
Management and Subadvisory Agreements, the Trustees reviewed a variety of materials relating to the Fund, the Investment Manager and each Subadvisor, including comparative performance, fee and expense information for an appropriate peer group of
similar mutual funds (the Peer Group), performance information for the relevant benchmark index (the Fund Benchmark) and, with respect to each Subadvisor, comparative performance information for an appropriate peer group of
managed accounts, and, as to all other matters, other information provided to them on a periodic basis throughout the year, as well as information provided in connection with the meetings of June 21-22, 2012, regarding the nature, extent and
quality of services provided by the Investment Manager and the Subadvisors under their respective agreements. Prior to voting, the Independent Trustees: (a) reviewed the foregoing information with their independent legal counsel and with
management; (b) received materials from their independent legal counsel discussing the legal standards applicable to their consideration of the Investment Management Agreement and the Subadvisory Agreements; and (c) met with their
independent legal counsel in private sessions at which no representatives of management were present.
Nature, extent,
and quality of services.
In considering the nature, extent and quality of the services provided by the Investment
Manager, the Trustees reviewed information relating to the Investment Managers operations and personnel. Among other things, the Investment Manager provided financial information, biographical information on its supervisory and professional
staff and descriptions of its organizational and management structure. The Trustees also took into account information provided periodically throughout the previous year by the Investment Manager relating to the performance of its duties with
respect to the Fund and the Trustees familiarity with the Investment Managers management through Board meetings, discussions and reports. In the course of their deliberations regarding the Investment Management Agreement, the Trustees
evaluated, among other things: (a) the extent and quality of the Investment Managers oversight of the operation and management of the Fund; (b) the quality of the search, selection and monitoring services performed by the Investment
Manager in overseeing the portfolio management responsibilities of the Subadvisors; (c) the Investment Managers ability to supervise the Funds other service providers; and (d) the Investment Managers compliance program.
The Trustees also took into account the financial condition of the Investment Manager with respect to its ability to provide the
services required under the Investment Management Agreement and to maintain a contractual expense limitation for the Fund. The Trustees also considered the Investment Managers risk
management processes.
The Trustees also reviewed information relating to each Subadvisors operations and personnel and
the investment philosophy, strategies and techniques (for each Subadvisor, its Investment Strategy) used in managing the portion of the Fund for which the Subadvisor has portfolio management responsibility. Among other things, the
Trustees reviewed biographical information on portfolio management and other professional staff, information regarding each Subadvisors organizational and management structure and each Subadvisors brokerage policies and practices. The
Trustees considered specific information provided regarding the experience of the individual or individuals at each Subadvisor with portfolio management responsibility for the portion of the Fund managed by the Subadvisor, including the information
set forth in the Funds prospectus and statement of additional information. The Trustees also noted information provided by the Investment Manager regarding the manner in which each Subadvisors Investment Strategy complements those
utilized by the Funds other Subadvisors. In the course of their deliberations, the Trustees evaluated, among other things: (a) the services rendered by each Subadvisor in the past; (b) the qualifications and experience of the
Subadvisors personnel; and (c) the Subadvisors compliance program. The Trustees also took into account the financial condition of each Subadvisor with respect to its ability to provide the services required under its Subadvisory
Agreement. The Trustees also considered each Subadvisors risk management processes.
Performance.
Among other information relating to the Funds performance, the Trustees noted that the
Funds performance for Managers Class shares for the 1-year, 3-year, 5-year and 10-year periods ended March 31, 2012 was above, above, below and below, respectively, the median performance of the Peer Group and above, above, below and
below, respectively, the performance of the Fund Benchmark, the Russell 2000® Growth Index. The Trustees took
into account managements discussion of the Funds more recent performance, including the fact that the Fund ranked in the top quintile of the Peer Group over the 1 and 3 year periods. The Trustees also noted that the Funds
longer-term performance is improving as a result of the Funds recent strong performance. The Trustees concluded that the Funds performance has been satisfactory.
As noted above, the Board considered the Funds net performance during relevant time periods as compared to the Funds Peer Group and Fund Benchmark and considered each Subadvisors
performance as compared to an appropriate peer group of managed accounts and also considered the gross performance of the portion of the Fund managed by each Subadvisor as compared to the Subadvisors relevant performance composite that
utilizes the same
Annual Renewal of Investment Advisory Agreement (continued)
investment strategy and approach and noted that the Board reviews on a quarterly basis detailed information about the Funds performance results, portfolio composition and Investment
Strategies, including with respect to the portion of the Fund managed by each Subadvisor. The Board noted the Investment Managers expertise and resources in monitoring the performance, investment style and risk-adjusted performance of each
Subadvisor. The Board also noted each Subadvisors performance record with respect to the Fund. The Board was mindful of the Investment Managers attention to monitoring each Subadvisors performance with respect to the Fund and its
discussions with management regarding the factors that contributed to the performance of the Fund.
Advisory and
Subadvisory Fees and Profitability.
In considering the reasonableness of the advisory fee charged by the Investment
Manager for managing the Fund, the Trustees noted that the Investment Manager, and not the Fund, is responsible for paying the fees charged by the Funds Subadvisors and, therefore, that the fees paid to the Investment Manager cover the cost of
providing portfolio management services as well as the cost of providing search, selection and monitoring services in operating a manager-of-managers complex of mutual funds. The Trustees concluded that, in light of the additional high
quality supervisory services provided by the Investment Manager and the fact that the subadvisory fees are paid out of the advisory fee, the advisory fee payable by the Fund to the Investment Manager can reasonably be expected to exceed the median
advisory fee for the Peer Group, which consists of many funds that do not operate with a manager-of-managers structure. In this regard, the Trustees also noted that the Investment Manager has undertaken to maintain an expense limitation for the
Fund.
In considering the reasonableness of the advisory fee payable to the Investment Manager, the Trustees also reviewed
information provided by the Investment Manager setting forth all revenues and other benefits, both direct and indirect (including any so-called fallout benefits such as reputational value derived from the Investment Manager serving as
Investment Manager to the Fund), received by the Investment Manager and its affiliates attributable to managing the Fund and all the mutual funds in the Managers Family of Funds, the cost of providing such services and the resulting profitability to
the Investment Manager and its affiliates from these relationships. The Trustees also noted the current and potential asset levels of the Fund and the willingness of the Investment Manager to waive fees and pay expenses for the Fund from time to
time as a means of limiting the total expenses of the Fund. The Trustees also considered managements discussion of the current asset levels of the Fund, including the effect on assets attributable to the economic and market conditions since
2008, and considered the impact on profitability of the current asset levels and any future growth of assets of the Fund. The Board took into account managements discussion of the advisory fee structure. In this regard, the Trustees noted that
the Fund currently has four Subadvisors, each managing a portion of the
Funds portfolio. Based on the foregoing, the Trustees concluded that the profitability to the Investment Manager is reasonable and that the Investment Manager is not realizing material
benefits from economies of scale that would warrant adjustments to the advisory fee at this time. With respect to economies of scale, the Trustees also noted that as the Funds assets increase over time, the Fund may realize other economies of
scale to the extent that the increase in assets is proportionally greater than the increase in certain other expenses.
In
considering the reasonableness of the fee payable by the Investment Manager to each Subadvisor, the Trustees relied on the ability of the Investment Manager to negotiate the terms of each Subadvisory Agreement at arms length as part of the
manager-of-managers structure, noting that the Investment Manager is not affiliated with these Subadvisors. In addition, the Trustees considered other potential benefits of the subadvisory relationship to a Subadvisor, including, among others, the
indirect benefits that the Subadvisor may receive from the Subadvisors relationship with the Fund, including any so-called fallout benefits to the Subadvisor, such as reputational value derived from the Subadvisor serving as
Subadvisor to the Fund. In addition, the Trustees noted that the subadvisory fees are paid by the Investment Manager out of its advisory fee. As a consequence, the cost of services to be provided by each Subadvisor and the profitability to each
Subadvisor of its relationship with the Fund were not material factors in the Trustees deliberations. For similar reasons, the Trustees did not consider potential economies of scale in the management of the Fund by the Subadvisors to be a
material factor in their deliberations at this time.
The Trustees noted that the Funds advisory fees (which include
both the advisory and administration fee) and total expenses (net of applicable expense waivers/reimbursements) as of March 31, 2012 were higher and lower, respectively, than the average for the Funds Peer Group. The Trustees took into
account the fact that the Investment Manager has contractually agreed, through May 1, 2013, to limit the Funds net annual operating expenses (subject to certain excluded expenses) to 1.11%. The Trustees took into account managements
discussion of the Funds expenses, including reductions to the Funds expense limitation effected in 2011. The Trustees concluded that, in light of the nature, extent and quality of the services provided by the Investment Manager and the
Subadvisors, the foregoing expense limitation and the considerations noted above with respect to the Subadvisors and the Investment Manager, the Funds advisory fees, including subadvisory fees, are reasonable.
* * * *
After consideration of the foregoing, the Trustees also reached the following conclusions (in addition to the conclusions discussed
above) regarding the Investment Management and Subadvisory Agreements: (a) the Investment Manager has demonstrated that it possesses the resources and capability to perform its duties under the Investment Management Agreement; (b) the
Subadvisor has the resources to perform its duties under the Subadvisory Agreement
Annual Renewal of Investment Advisory Agreement (continued)
and is qualified to manage the Funds assets in accordance with its investment objectives and policies; and (c) the Investment Manager and Subadvisor maintain appropriate compliance
programs.
Based on all of the above-mentioned factors and their related conclusions, with no single factor or conclusion
being determinative and with each Trustee not necessarily attributing the
same weight to each factor, the Trustees concluded that approval of the Investment Management Agreement and each Subadvisory Agreement would be in the best interests of the Fund and its
shareholders. Accordingly, on June 21-22, 2012, the Trustees, including a majority of the Independent Trustees, voted to approve the Investment Management Agreement and the Subadvisory Agreements for the Fund.
THIS PAGE INTENTIONALLY LEFT BLANK
THIS PAGE INTENTIONALLY LEFT BLANK
Investment Manager and Administrator
Managers Investment Group LLC
800 Connecticut
Avenue
Norwalk, CT 06854
(800)
835-3879
Distributor
Managers Distributors, Inc.
800 Connecticut
Avenue
Norwalk, CT 06854
(800)
835-3879
Custodian
The Bank
of New York Mellon
2 Hanson Place
Brooklyn, NY 11217
Legal Counsel
Ropes & Gray LLP
Prudential Tower, 800 Boylston Street
Boston,
MA 02199-3600
Transfer Agent
BNY Mellon Investment Servicing (US) Inc.
Attn:
Managers
P.O. Box 9769
Providence,
RI 02940
(800) 548-4539
For ManagersChoiceTM Only
Managers
c/o BNY Mellon Investment Servicing (US) Inc.
P.O. Box 9847
Providence, RI 02940-8047
(800) 358-7668
Trustees
Jack W. Aber
Bruce B. Bingham
Christine E.
Carsman
William E. Chapman, II
Edward J. Kaier
Steven J. Paggioli
Eric Rakowski
Thomas R. Schneeweis
MANAGERS AND MANAGERS AMG
FUNDS
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EQUITY
FUNDS |
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BALANCED
FUNDS |
CADENCE CAPITAL
APPRECIATION CADENCE FOCUSED GROWTH
CADENCE MID-CAP CADENCE EMERGING COMPANIES Cadence Capital
Management, LLC CHICAGO EQUITY
PARTNERS MID-CAP Chicago Equity Partners, LLC
ESSEX SMALL/MICRO CAP
GROWTH Essex Investment Management Co., LLC
FQ TAX-MANAGED U.S. EQUITY FQ U.S. EQUITY First Quadrant, L.P.
FRONTIER SMALL CAP
GROWTH Frontier Capital Management Company, LLC
GW&K SMALL CAP
EQUITY Gannett Welsh & Kotler, LLC
MICRO-CAP
Lord, Abbett & Co. LLC WEDGE Capital
Management L.L.P. Next Century Growth Investors LLC RBC Global Asset Management (U.S.) Inc. |
|
REAL ESTATE
SECURITIES Urdang Securities Management, Inc.
RENAISSANCE LARGE CAP
GROWTH Renaissance Group LLC
SKYLINE SPECIAL EQUITIES PORTFOLIO Skyline Asset Management, L.P.
SPECIAL EQUITY
Ranger Investment Management, L.P. Lord, Abbett
& Co. LLC Smith Asset Management Group, L.P. Federated MDTA LLC
SYSTEMATIC VALUE SYSTEMATIC MID CAP VALUE
Systematic Financial Management, L.P.
TIMESSQUARE MID CAP GROWTH
TIMESSQUARE SMALL CAP GROWTH
TSCM GROWTH EQUITY TimesSquare Capital Management, LLC TRILOGY GLOBAL EQUITY
TRILOGY EMERGING MARKETS EQUITY TRILOGY INTERNATIONAL SMALL CAP
Trilogy Global Advisors, L.P.
YACKTMAN FUND
YACKTMAN FOCUSED FUND Yacktman Asset Management L.P. |
|
CHICAGO EQUITY
PARTNERS BALANCED Chicago Equity Partners, LLC
ALTERNATIVE
FUNDS FQ GLOBAL
ALTERNATIVES FQ GLOBAL ESSENTIALS
First Quadrant, L.P.
INCOME FUNDS
BOND (MANAGERS)
FIXED INCOME
GLOBAL INCOME OPPORTUNITY Loomis, Sayles & Co., L.P.
BOND (MANAGERS PIMCO) Pacific Investment Management Co. LLC CALIFORNIA INTERMEDIATE TAX-FREE
Miller Tabak Asset Management LLC
GW&K MUNICIPAL BOND GW&K MUNICIPAL ENHANCED YIELD Gannett
Welsh & Kotler, LLC HIGH
YIELD J.P. Morgan Investment Management LLC
INTERMEDIATE DURATION GOVERNMENT SHORT DURATION GOVERNMENT Smith Breeden
Associates, Inc. |
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This report is prepared for the Funds shareholders. It is authorized for distribution to
prospective investors only when preceded or accompanied by an effective prospectus. To receive a free copy of the prospectus or Statement of Additional Information, which includes additional information about Fund Trustees, please contact us by
calling 800.835.3879. Distributed by Managers Distributors, Inc., member FINRA. A description of the policies and procedures each Fund uses to vote its proxies is available: (i) without charge, upon request, by calling 800.835.3879, or (ii) on the Securities and Exchange
Commissions (SEC) Web site at www. sec.gov. For information regarding each Funds proxy voting record for the 12-month period ended June 30, call 800.835.3879 or visit the SEC Web site at www.sec.gov.
The Fund files its complete schedule of portfolio holdings with
the SEC for the first and third quarters of each fiscal year on Form N-Q. The Funds Forms N-Q are available on the SECs Web site at www.sec.gov. A Funds Forms N-Q may be reviewed and copied at the SECs Public Reference Room
in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 800.SEC.0330. To review a complete list of the Funds portfolio holdings, or to view the most recent quarterly holdings report, semiannual
report, or annual report, please visit www.managersinvest.com. |
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www.managersinvest.com
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SEMI-ANNUAL REPORT
Managers Funds
June 30, 2012
Managers Bond Fund
Managers Bond Fund
Semi-Annual Report June 30, 2012
(unaudited)
TABLE OF CONTENTS
Nothing contained herein is to be considered an offer, sale or solicitation of an offer to buy shares of any series of
the Managers Family of Funds. Such offering is made only by Prospectus, which includes details as to offering price and other material information.
About Your Funds Expenses (unaudited)
As a shareholder of a Fund, you may incur two types of costs: (1) transaction costs,
which may include sales charges (loads) on purchase payments; redemption fees; and exchange fees; 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 $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 following table provides information about the 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 $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled Expenses
Paid During Period to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison
Purposes
The second line of the following table provides information about hypothetical account values and
hypothetical expenses based on the Funds actual expense ratio and an assumed annual rate of return of 5% before expenses, which is not the Funds actual return. The hypothetical account values and expenses may not be used to estimate the
actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds by comparing this 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of other funds.
Please note that the expenses shown in the table are meant to highlight
your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine
the relative total costs of owning different funds.
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Six Months Ended June 30, 2012 |
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Expense Ratio for the Period |
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Beginning Account Value 01/01/12 |
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Ending Account Value 06/30/12 |
|
|
Expenses Paid During the Period* |
|
Managers Bond Fund |
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Based on Actual Fund Return |
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0.99 |
% |
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$ |
1,000 |
|
|
$ |
1,053 |
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$ |
5.05 |
|
Hypothetical (5% return before expenses) |
|
|
0.99 |
% |
|
$ |
1,000 |
|
|
$ |
1,020 |
|
|
$ |
4.97 |
|
* |
Expenses are equal to the Funds annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the most
recent fiscal half-year (182), then divided by 366. |
Fund Performance
Periods ended June 30, 2012 (unaudited)
The table below shows the average annual total returns for the periods indicated for the Fund, as well as the Funds relative index
for the same time periods.
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Average Annual Total
Returns1 |
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Six Months* |
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One Year |
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Five Years |
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Ten Years |
|
Managers Bond Fund2,3,4,5 |
|
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5.33 |
% |
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6.39 |
% |
|
|
7.52 |
% |
|
|
7.07 |
% |
Barclays U.S. Government Credit Bond Index6 |
|
|
2.65 |
% |
|
|
8.78 |
% |
|
|
6.90 |
% |
|
|
5.79 |
% |
The performance data shown represents past performance. Past performance is not a
guarantee of future results. Current performance may be lower or higher than the performance data quoted. The investment return and principal value of an investment in the Fund will fluctuate so that an investors shares, when redeemed, may be
worth more or less than their original cost. For performance information through the most recent month end, please call (800) 835-3879 or visit our Web site at www.managersinvest.com.
Investors should carefully consider the Funds investment objectives, risks, charges, and expenses before investing. For this and
other information, please call (800) 835-3879 or visit www.managersinvest.com for a free prospectus. Read it carefully before investing or sending money. Funds are distributed by Managers Distributors, Inc., a member of FINRA.
1 |
Total return equals income yield plus share price change and assumes reinvestment of all dividends and capital gain distributions. Returns are net of
fees and may reflect offsets of Fund expenses as described in the Prospectus. No adjustment has been made for taxes payable by shareholders on their reinvested dividends and capital gain distributions.
|
Returns for periods greater than one year are annualized. The listed returns on the Fund
are net of expenses and based on the published NAV as of June 30, 2012. All returns are in U.S. dollars($).
2 |
From time to time, the Funds advisor has waived its fees and/or absorbed Fund expenses, which has resulted in higher returns.
|
3 |
The Fund is subject to risks associated with investments in debt securities, such as default risk and fluctuations in the perception of the
debtors ability to pay its creditors. Changing interest rates may adversely affect the value of a fixed income investment. An increase in interest rates typically causes the value of bonds and other fixed income securities to fall.
|
4 |
Investments in international securities are subject to certain risks of overseas investing including currency fluctuations and changes in political and
economic conditions, which could result in significant market fluctuations. These risks are magnified in emerging markets. |
5 |
High yield bonds (also known as junk bonds) are subject to additional risks such as the risk of default. |
6 |
The Barclays U.S. Government/Credit Bond Index is an index of investment grade government and corporate bonds with a maturity rate of more than one
year. Unlike the Fund, the Barclays U.S. Government/Credit Bond Index is unmanaged, is not available for investment, and does not incur expenses. |
Not FDIC Insured, nor bank guaranteed. May lose value.
Managers Bond Fund
Fund Snapshots
June 30, 2012
Portfolio Breakdown (unaudited)
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Category |
|
Managers Bond Fund** |
|
|
Barclays U.S. Government/ Credit Bond Index |
|
Corporate Bonds and Notes |
|
|
65.9 |
% |
|
|
30.6 |
% |
U.S. Government and Agency Obligations |
|
|
19.0 |
% |
|
|
61.3 |
% |
Foreign Government and Agency Obligations |
|
|
6.3 |
% |
|
|
8.1 |
% |
Asset-Backed Securities |
|
|
2.4 |
% |
|
|
0.0 |
% |
Mortgage-Backed Securities |
|
|
1.1 |
% |
|
|
0.0 |
% |
Municipal Bonds |
|
|
1.0 |
% |
|
|
0.0 |
% |
Preferred Stocks |
|
|
0.7 |
% |
|
|
0.0 |
% |
Common Stocks |
|
|
0.7 |
% |
|
|
0.0 |
% |
Bank Loan Obligations |
|
|
0.5 |
% |
|
|
0.0 |
% |
Other Assets and Liabilities |
|
|
2.4 |
% |
|
|
0.0 |
% |
** |
As a percentage of net assets
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Rating |
|
Managers Bond Fund** |
|
|
Barclays U.S. Government/ Credit Bond Index |
|
U.S. Treasury & Agency |
|
|
20.0 |
% |
|
|
61.3 |
% |
Aaa |
|
|
5.4 |
% |
|
|
3.7 |
% |
Aa |
|
|
2.7 |
% |
|
|
4.3 |
% |
A |
|
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20.4 |
% |
|
|
16.4 |
% |
Baa |
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|
42.1 |
% |
|
|
14.3 |
% |
Ba & lower |
|
|
8.8 |
% |
|
|
0.0 |
% |
Not Rated |
|
|
0.6 |
% |
|
|
0.0 |
% |
** |
As a percentage of market value of fixed income securities Chart does not include equity securities.
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Top Ten Holdings (unaudited)
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Security Name |
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% of Net Assets |
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U.S. Treasury Note, 0.250%, 05/31/14 |
|
|
9.7 |
% |
U.S. Treasury Note, 0.250%, 02/28/14 |
|
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6.5 |
|
Southwestern Electric Power Co., 6.450%, 01/15/19* |
|
|
2.1 |
|
Springleaf Finance Corp., MTN, Series J, 6.900%, 12/15/17* |
|
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2.0 |
|
Kinder Morgan Energy Partners, L.P., 5.950%, 02/15/18* |
|
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1.8 |
|
EQT Corp., 6.500%, 04/01/18* |
|
|
1.7 |
|
Merrill Lynch & Co., Inc., 6.110%, 01/29/37* |
|
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1.6 |
|
Dun & Bradstreet Corp., The, 6.000%, 04/01/13* |
|
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1.4 |
|
Nisource Finance Corp., 6.400%, 03/15/18* |
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1.4 |
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Panhandle Eastern Pipeline Co., L.P., 7.000%, 06/15/18* |
|
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1.4 |
|
Top Ten as a Group |
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29.6 |
% |
|
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|
* |
Top Ten Holding at December 31, 2011
|
Any sectors, industries, or
securities discussed should not be perceived as investment recommendations. Mention of a specific security should not be considered a recommendation to buy or solicitation to sell that security. Specific securities mentioned in this report may have
been sold from the Funds portfolio of investments by the time you receive this report.
Managers Bond Fund
Schedule of
Portfolio Investments
June 30, 2012 (unaudited)
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Principal Amount |
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Value |
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Asset-Backed Securities - 2.4% |
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Chase Issuance Trust, Series 2007-B1, Class B-1, 0.492%, 04/15/19 (07/16/12)1 |
|
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$ |
17,040,000 |
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|
$ |
16,861,978 |
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Marriott Vacation Club Owner Trust, Series 2009-2A, Class A, 4.809%, 07/20/31 (a) |
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8,174,027 |
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8,533,517 |
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Merrill Auto Trust Securitization, Series 2008-1, Class B, 6.750%, 04/15/15 |
|
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1,700,630 |
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1,705,298 |
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Sierra Receivables Funding Co., LLC, Series 2010-2A, Class A, 3.840%, 11/20/25 (a) |
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9,272,272 |
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9,445,223 |
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Trinity Rail Leasing, L.P., Series 2009-1A, Class A, 6.657%, 11/16/39 (a) |
|
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4,488,768 |
|
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|
5,176,857 |
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Trip Rail Master Funding LLC, Series 2011-1A, Class A1A, 4.370%, 07/15/41 (a) |
|
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13,274,504 |
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13,513,037 |
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World Financial Network Credit Card Master Trust, Series 2010-A, 6.750%, 04/15/19 |
|
|
|
|
1,000,000 |
|
|
|
1,107,384 |
|
Total Asset-Backed Securities (cost $52,739,338) |
|
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|
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56,343,294 |
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Bank Loan Obligations - 0.5% |
|
|
|
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|
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Flying Fortress, Inc., Term Loan, 5.000%, 06/30/17 (cost $11,325,600) |
|
|
|
|
11,440,000 |
|
|
|
11,454,300 |
|
|
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|
|
Shares |
|
|
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|
|
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Common Stocks - 0.7% |
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|
|
|
|
|
|
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|
PPG Industries, Inc. (Materials) (cost $10,696,329) |
|
|
|
|
145,736 |
|
|
|
15,465,504 |
|
|
|
|
|
|
|
|
|
Principal Amount |
|
|
|
|
|
|
|
|
Corporate Bonds and Notes - 65.9% |
|
|
|
|
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|
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|
|
Financials - 25.8% |
|
|
|
|
|
|
|
|
|
|
Ally Financial, Inc., 8.000%, 11/01/31 |
|
|
|
$ |
1,267,000 |
|
|
|
1,485,557 |
|
Alta Wind Holdings LLC, 7.000%, 06/30/35 (a) |
|
|
|
|
8,217,432 |
|
|
|
9,237,380 |
|
American International Group, Inc., |
|
|
|
|
|
|
|
|
|
|
8.175%, 05/15/582 |
|
|
|
|
10,530,000 |
|
|
|
11,425,050 |
|
MTN, 5.450%, 05/18/17 |
|
|
|
|
485,000 |
|
|
|
526,509 |
|
MTN, Series G, 5.850%, 01/16/18 |
|
|
|
|
1,940,000 |
|
|
|
2,144,715 |
|
Bank of America Corp., |
|
|
|
|
|
|
|
|
|
|
7.625%, 06/01/19 |
|
|
|
|
2,906,000 |
|
|
|
3,417,110 |
|
MTN, 5.000%, 05/13/21 |
|
|
|
|
2,475,000 |
|
|
|
2,553,475 |
|
Camden Property Trust, 5.700%, 05/15/17 |
|
|
|
|
5,205,000 |
|
|
|
5,843,331 |
|
Cantor Fitzgerald, L.P., |
|
|
|
|
|
|
|
|
|
|
6.375%, 06/26/15 (a) |
|
|
|
|
8,710,000 |
|
|
|
8,784,889 |
|
7.875%, 10/15/19 (a)3 |
|
|
|
|
10,805,000 |
|
|
|
10,665,367 |
|
Citigroup, Inc., |
|
|
|
|
|
|
|
|
|
|
5.500%, 10/15/14 |
|
|
|
|
21,385,000 |
|
|
|
22,641,775 |
|
6.125%, 08/25/36 |
|
|
|
|
10,760,000 |
|
|
|
10,583,289 |
|
6.250%, 06/29/17 |
|
NZD |
|
|
37,108,000 |
|
|
|
29,649,865 |
|
Cooperatieve Centrale Raiffeisen-Boerenleenbank BA/Netherlands, |
|
|
|
|
|
|
|
|
|
|
3.375%, 01/19/17 |
|
|
|
|
7,295,000 |
|
|
|
7,507,919 |
|
3.875%, 02/08/22 |
|
|
|
|
5,885,000 |
|
|
|
5,986,416 |
|
Crown Castle Towers LLC, 6.113%, 01/15/20 (a) |
|
|
|
|
13,725,000 |
|
|
|
15,888,280 |
|
Duke Realty, L.P., |
|
|
|
|
|
|
|
|
|
|
5.950%, 02/15/17 |
|
|
|
|
2,210,000 |
|
|
|
2,443,482 |
|
6.500%, 01/15/18 |
|
|
|
|
5,000,000 |
|
|
|
5,667,060 |
|
Equifax, Inc., 7.000%, 07/01/37 |
|
|
|
|
4,421,000 |
|
|
|
5,223,447 |
|
Equity One, Inc., 6.000%, 09/15/17 |
|
|
|
|
5,915,000 |
|
|
|
6,418,035 |
|
|
The accompanying
notes are an integral part of these financial statements. 7 |
Managers Bond Fund
Schedule of
Portfolio Investments (continued)
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal Amount |
|
|
Value |
|
Financials - 25.8% (continued) |
|
|
|
|
|
|
|
|
|
|
ERP Operating, L.P., |
|
|
|
|
|
|
|
|
|
|
5.125%, 03/15/16 |
|
|
|
$ |
600,000 |
|
|
$ |
661,454 |
|
5.750%, 06/15/17 |
|
|
|
|
925,000 |
|
|
|
1,067,230 |
|
Export-Import Bank of Korea, The, 8.300%, 03/15/14 (a) |
|
IDR |
|
|
1,400,000,000 |
|
|
|
150,322 |
|
First Industrial, L.P., 5.950%, 05/15/17 |
|
|
|
|
15,000,000 |
|
|
|
15,430,635 |
|
General Electric Capital Corp., |
|
|
|
|
|
|
|
|
|
|
6.500%, 09/28/154 |
|
NZD |
|
|
15,265,000 |
|
|
|
12,899,542 |
|
6.750%, 09/26/16 |
|
NZD |
|
|
6,390,000 |
|
|
|
5,496,239 |
|
EMTN, 5.500%, 02/01/17 |
|
NZD |
|
|
6,250,000 |
|
|
|
5,214,670 |
|
GMTN, 7.625%, 12/10/14 |
|
NZD |
|
|
9,365,000 |
|
|
|
8,041,516 |
|
Goldman Sachs Group, Inc., The, 6.750%, 10/01/37 |
|
|
|
|
14,590,000 |
|
|
|
14,298,973 |
|
Hanover Insurance Group, Inc., The, 7.500%, 03/01/20 |
|
|
|
|
6,475,000 |
|
|
|
7,511,447 |
|
Highwoods Realty, L.P., |
|
|
|
|
|
|
|
|
|
|
5.850%, 03/15/17 |
|
|
|
|
3,680,000 |
|
|
|
3,948,813 |
|
7.500%, 04/15/18 |
|
|
|
|
2,405,000 |
|
|
|
2,765,495 |
|
ICICI Bank, Ltd., 6.375%, 04/30/22 (a)2 |
|
|
|
|
900,000 |
|
|
|
801,000 |
|
Instituto de Credito Oficial, MTN, 5.500%, 10/11/12 |
|
AUD |
|
|
3,735,000 |
|
|
|
3,796,956 |
|
iStar Financial, Inc., |
|
|
|
|
|
|
|
|
|
|
5.700%, 03/01/14 |
|
|
|
|
15,000 |
|
|
|
14,137 |
|
5.850%, 03/15/17 |
|
|
|
|
325,000 |
|
|
|
286,812 |
|
5.875%, 03/15/16 |
|
|
|
|
1,340,000 |
|
|
|
1,209,350 |
|
6.050%, 04/15/15 |
|
|
|
|
620,000 |
|
|
|
578,150 |
|
JPMorgan Chase & Co., |
|
|
|
|
|
|
|
|
|
|
7.700%, 06/01/16 (a) |
|
IDR |
|
|
19,000,000,000 |
|
|
|
2,095,715 |
|
Series EMTN, 1.176%, 05/30/17 (07/31/12)1 |
|
GBP |
|
|
1,500,000 |
|
|
|
2,049,694 |
|
Lloyds TSB Bank PLC, 6.500%, 09/14/20 (a)4 |
|
|
|
|
17,940,000 |
|
|
|
17,670,039 |
|
Marsh & McLennan Cos., Inc., 5.875%, 08/01/33 |
|
|
|
|
10,360,000 |
|
|
|
12,118,962 |
|
MBIA Insurance Corp., 14.000%, 01/15/33 (a)2 |
|
|
|
|
525,000 |
|
|
|
283,500 |
|
Merrill Lynch & Co., Inc., |
|
|
|
|
|
|
|
|
|
|
6.050%, 05/16/16 |
|
|
|
|
900,000 |
|
|
|
930,500 |
|
6.110%, 01/29/37 |
|
|
|
|
38,050,000 |
|
|
|
35,853,107 |
|
10.710%, 03/08/17 |
|
BRL |
|
|
2,500,000 |
|
|
|
1,282,051 |
|
EMTN, 4.625%, 09/14/18 |
|
EUR |
|
|
1,750,000 |
|
|
|
2,032,835 |
|
MTN, Series C, 6.050%, 06/01/34 |
|
|
|
|
22,100,000 |
|
|
|
21,051,598 |
|
Morgan Stanley, |
|
|
|
|
|
|
|
|
|
|
0.947%, 10/15/15 (07/16/12)1 |
|
|
|
|
300,000 |
|
|
|
267,254 |
|
3.450%, 11/02/15 |
|
|
|
|
2,360,000 |
|
|
|
2,285,292 |
|
4.750%, 04/01/144 |
|
|
|
|
8,355,000 |
|
|
|
8,428,541 |
|
5.500%, 07/24/20 |
|
|
|
|
29,000,000 |
|
|
|
28,372,614 |
|
5.750%, 01/25/21 |
|
|
|
|
400,000 |
|
|
|
394,417 |
|
GMTN, 5.500%, 01/26/20 |
|
|
|
|
500,000 |
|
|
|
489,710 |
|
MTN, 0.916%, 10/18/16 (07/18/12)1 |
|
|
|
|
2,000,000 |
|
|
|
1,743,056 |
|
MTN, 5.625%, 09/23/19 |
|
|
|
|
7,500,000 |
|
|
|
7,422,750 |
|
MTN, 6.250%, 08/09/26 |
|
|
|
|
11,000,000 |
|
|
|
10,837,431 |
|
|
The accompanying
notes are an integral part of these financial statements. 8 |
Managers Bond Fund
Schedule of
Portfolio Investments (continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal Amount |
|
|
Value |
|
Financials - 25.8% (continued) |
|
|
|
|
|
|
|
|
|
|
Morgan Stanley, |
|
|
|
|
|
|
|
|
|
|
MTN, 6.625%, 04/01/18 |
|
|
|
$ |
3,095,000 |
|
|
$ |
3,236,033 |
|
Series GMTN, 8.000%, 05/09/174 |
|
AUD |
|
|
8,100,000 |
|
|
|
8,626,412 |
|
Mutual of Omaha Insurance Co., 6.800%, 06/15/36 (a) |
|
|
|
|
13,925,000 |
|
|
|
15,700,827 |
|
National City Bank of Indiana, 4.250%, 07/01/18 |
|
|
|
|
6,310,000 |
|
|
|
6,731,912 |
|
National City Corp., 6.875%, 05/15/19 |
|
|
|
|
1,905,000 |
|
|
|
2,299,204 |
|
National Life Insurance Co., 10.500%, 09/15/39 (a) |
|
|
|
|
5,000,000 |
|
|
|
6,657,945 |
|
Nationwide Mutual Insurance Co., 6.600%, 04/15/34 (a) |
|
|
|
|
3,325,000 |
|
|
|
3,246,969 |
|
Newfield Exploration Co., 5.625%, 07/01/24 |
|
|
|
|
6,320,000 |
|
|
|
6,462,200 |
|
Old Republic International Corp., 3.750%, 03/15/185 |
|
|
|
|
11,795,000 |
|
|
|
10,615,500 |
|
Penn Mutual Life Insurance Co., The, 7.625%, 06/15/40 (a) |
|
|
|
|
8,885,000 |
|
|
|
10,960,696 |
|
ProLogis, L.P., |
|
|
|
|
|
|
|
|
|
|
5.625%, 11/15/15 |
|
|
|
|
345,000 |
|
|
|
375,997 |
|
5.750%, 04/01/16 |
|
|
|
|
280,000 |
|
|
|
305,773 |
|
Realty Income Corp., |
|
|
|
|
|
|
|
|
|
|
5.750%, 01/15/21 |
|
|
|
|
1,435,000 |
|
|
|
1,604,110 |
|
6.750%, 08/15/19 |
|
|
|
|
6,240,000 |
|
|
|
7,351,800 |
|
Santander Financial Issuances, Ltd., 7.250%, 11/01/15 |
|
|
|
|
500,000 |
|
|
|
486,991 |
|
Santander Issuances SAU, |
|
|
|
|
|
|
|
|
|
|
5.911%, 06/20/16 (a) |
|
|
|
|
1,100,000 |
|
|
|
1,015,553 |
|
6.500%, 08/11/19 (a)2 |
|
|
|
|
900,000 |
|
|
|
778,682 |
|
Simon Property Group, L.P., 5.750%, 12/01/15 |
|
|
|
|
445,000 |
|
|
|
497,200 |
|
Sirius International Group Ltd., 6.375%, 03/20/17 (a) |
|
|
|
|
4,555,000 |
|
|
|
4,820,976 |
|
SLM Corp., |
|
|
|
|
|
|
|
|
|
|
5.000%, 04/15/15 |
|
|
|
|
50,000 |
|
|
|
50,460 |
|
5.375%, 05/15/14 |
|
|
|
|
300,000 |
|
|
|
310,489 |
|
8.450%, 06/15/18 |
|
|
|
|
18,665,000 |
|
|
|
20,904,800 |
|
Societe Generale SA, 5.200%, 04/15/21 (a) |
|
|
|
|
7,000,000 |
|
|
|
6,689,634 |
|
Springleaf Finance Corp., |
|
|
|
|
|
|
|
|
|
|
MTN, 5.400%, 12/01/15 |
|
|
|
|
5,000,000 |
|
|
|
4,162,500 |
|
MTN, Series J, 6.900%, 12/15/17 |
|
|
|
|
57,315,000 |
|
|
|
45,744,248 |
|
WEA Finance LLC / WT Finance Australia Pty., Ltd., 6.750%, 09/02/19 (a) |
|
|
|
|
8,325,000 |
|
|
|
9,822,443 |
|
Willis North America, Inc., |
|
|
|
|
|
|
|
|
|
|
6.200%, 03/28/17 |
|
|
|
|
5,350,000 |
|
|
|
6,018,825 |
|
7.000%, 09/29/19 |
|
|
|
|
2,860,000 |
|
|
|
3,314,308 |
|
Total Financials |
|
|
|
|
|
|
|
|
596,667,245 |
|
Industrials - 30.6% |
|
|
|
|
|
|
|
|
|
|
Agilent Technologies, Inc., 6.500%, 11/01/17 |
|
|
|
|
3,525,000 |
|
|
|
4,232,954 |
|
Alcatel-Lucent USA, Inc., |
|
|
|
|
|
|
|
|
|
|
6.450%, 03/15/29 |
|
|
|
|
4,335,000 |
|
|
|
2,947,800 |
|
6.500%, 01/15/28 |
|
|
|
|
305,000 |
|
|
|
205,875 |
|
APL, Ltd., 8.000%, 01/15/243 |
|
|
|
|
250,000 |
|
|
|
171,250 |
|
|
The accompanying
notes are an integral part of these financial statements. 9 |
Managers Bond Fund
Schedule of
Portfolio Investments (continued)
|
|
|
|
|
|
|
|
|
|
|
Principal Amount |
|
|
Value |
|
Industrials - 30.6% (continued) |
|
|
|
|
|
|
|
|
ArcelorMittal, |
|
|
|
|
|
|
|
|
5.500%, 03/01/214 |
|
$ |
150,000 |
|
|
$ |
141,978 |
|
6.125%, 06/01/18 |
|
|
4,580,000 |
|
|
|
4,643,877 |
|
6.250%, 02/25/22 |
|
|
1,600,000 |
|
|
|
1,567,053 |
|
6.750%, 03/01/41 |
|
|
10,230,000 |
|
|
|
9,548,590 |
|
7.000%, 10/15/39 |
|
|
6,604,000 |
|
|
|
6,410,186 |
|
AT&T Corp., 6.500%, 03/15/29 |
|
|
6,415,000 |
|
|
|
7,651,440 |
|
BellSouth Corp., 6.000%, 11/15/34 |
|
|
2,370,000 |
|
|
|
2,633,153 |
|
Canadian Pacific Railway Co., 5.750%, 03/15/33 |
|
|
195,000 |
|
|
|
216,200 |
|
CenturyLink, Inc., |
|
|
|
|
|
|
|
|
6.450%, 06/15/21 |
|
|
13,395,000 |
|
|
|
13,938,516 |
|
Series P, 7.600%, 09/15/39 |
|
|
9,335,000 |
|
|
|
9,014,912 |
|
Chesapeake Energy Corp., |
|
|
|
|
|
|
|
|
2.500%, 05/15/374,5 |
|
|
1,100,000 |
|
|
|
941,875 |
|
2.750%, 11/15/354,5 |
|
|
600,000 |
|
|
|
548,250 |
|
6.625%, 08/15/204 |
|
|
55,000 |
|
|
|
54,450 |
|
6.875%, 11/15/20 |
|
|
40,000 |
|
|
|
39,400 |
|
Choice Hotels International, Inc., 5.700%, 08/28/20 |
|
|
11,900,000 |
|
|
|
12,258,261 |
|
Cigna Corp., 6.150%, 11/15/36 |
|
|
6,830,000 |
|
|
|
8,006,884 |
|
Continental Airlines, Inc., |
|
|
|
|
|
|
|
|
1999-1 Class B Pass Through Trust, Series 991B, 6.795%, 08/02/18 |
|
|
21,135 |
|
|
|
20,924 |
|
2000-1 Class A-1 Pass Through Trust, Series 00A1, 8.048%, 11/01/20 |
|
|
83,143 |
|
|
|
91,457 |
|
2007-1 Class A Pass Through Trust, Series 071A, 5.983%, 04/19/22 |
|
|
16,539,160 |
|
|
|
17,944,988 |
|
2007-1 Class B Pass Through Trust, Series 071B, 6.903%, 04/19/22 |
|
|
5,337,143 |
|
|
|
5,390,514 |
|
Corning, Inc., |
|
|
|
|
|
|
|
|
6.850%, 03/01/29 |
|
|
9,142,000 |
|
|
|
10,960,143 |
|
7.250%, 08/15/36 |
|
|
1,185,000 |
|
|
|
1,463,865 |
|
Cummins, Inc., |
|
|
|
|
|
|
|
|
5.650%, 03/01/98 |
|
|
11,235,000 |
|
|
|
11,564,601 |
|
6.750%, 02/15/27 |
|
|
2,853,000 |
|
|
|
3,539,306 |
|
Cytec Industries, Inc., 6.000%, 10/01/15 |
|
|
875,000 |
|
|
|
960,964 |
|
Darden Restaurants, Inc., 6.000%, 08/15/35 |
|
|
2,635,000 |
|
|
|
2,846,891 |
|
Delta Air Lines, Inc., |
|
|
|
|
|
|
|
|
2007-1 Class B Pass Through Trust, Series 071B, 8.021%, 08/10/22 |
|
|
10,839,635 |
|
|
|
10,962,123 |
|
2010-1 Class A Pass Through Trust, Series 1A, 6.200%, 07/02/18 |
|
|
4,653,796 |
|
|
|
5,037,734 |
|
Dillards, Inc., 7.000%, 12/01/28 |
|
|
225,000 |
|
|
|
216,562 |
|
DP World, Ltd., 6.850%, 07/02/37 (a) |
|
|
28,350,000 |
|
|
|
27,853,875 |
|
Dun & Bradstreet Corp., The, 6.000%, 04/01/13 |
|
|
32,120,000 |
|
|
|
33,307,027 |
|
Embarq Corp., 7.995%, 06/01/36 |
|
|
5,830,000 |
|
|
|
6,089,989 |
|
Energy Transfer Partners, L.P., |
|
|
|
|
|
|
|
|
6.125%, 02/15/17 |
|
|
700,000 |
|
|
|
786,752 |
|
6.625%, 10/15/36 |
|
|
1,805,000 |
|
|
|
1,917,592 |
|
Enterprise Products Operating LLC, 4.050%, 02/15/22 |
|
|
8,450,000 |
|
|
|
8,960,938 |
|
EQT Corp., 6.500%, 04/01/18 |
|
|
35,420,000 |
|
|
|
40,265,916 |
|
|
The accompanying
notes are an integral part of these financial statements. 10 |
Managers Bond Fund
Schedule of
Portfolio Investments (continued)
|
|
|
|
|
|
|
|
|
|
|
Principal Amount |
|
|
Value |
|
Industrials - 30.6% (continued) |
|
|
|
|
|
|
|
|
ERAC USA Finance LLC, |
|
|
|
|
|
|
|
|
6.375%, 10/15/17 (a) |
|
$ |
4,910,000 |
|
|
$ |
5,738,887 |
|
6.700%, 06/01/34 (a) |
|
|
1,250,000 |
|
|
|
1,434,841 |
|
7.000%, 10/15/37 (a) |
|
|
19,033,000 |
|
|
|
22,943,120 |
|
Express Scripts Holding Co., 4.750%, 11/15/21 (a) |
|
|
7,525,000 |
|
|
|
8,327,007 |
|
Foot Locker, Inc., 8.500%, 01/15/22 |
|
|
570,000 |
|
|
|
617,737 |
|
Ford Motor Co., 6.375%, 02/01/29 |
|
|
1,990,000 |
|
|
|
2,142,259 |
|
Georgia-Pacific LLC, 5.400%, 11/01/20 (a) |
|
|
5,175,000 |
|
|
|
6,004,910 |
|
Intel Corp., |
|
|
|
|
|
|
|
|
2.950%, 12/15/355 |
|
|
8,030,000 |
|
|
|
9,083,937 |
|
3.250%, 08/01/395 |
|
|
15,000,000 |
|
|
|
20,193,750 |
|
Intuit, Inc., 5.750%, 03/15/17 |
|
|
3,560,000 |
|
|
|
4,074,263 |
|
Kinder Morgan Energy Partners, L.P., |
|
|
|
|
|
|
|
|
5.300%, 09/15/20 |
|
|
8,100,000 |
|
|
|
8,972,249 |
|
5.800%, 03/15/35 |
|
|
3,360,000 |
|
|
|
3,558,405 |
|
5.950%, 02/15/18 |
|
|
36,530,000 |
|
|
|
42,360,517 |
|
Marks & Spencer PLC, 7.125%, 12/01/37 (a) |
|
|
4,725,000 |
|
|
|
4,993,829 |
|
Masco Corp., |
|
|
|
|
|
|
|
|
5.850%, 03/15/17 |
|
|
8,150,000 |
|
|
|
8,543,148 |
|
6.500%, 08/15/32 |
|
|
955,000 |
|
|
|
918,002 |
|
7.125%, 03/15/20 |
|
|
8,815,000 |
|
|
|
9,726,118 |
|
7.750%, 08/01/29 |
|
|
1,070,000 |
|
|
|
1,121,073 |
|
Mead Corp., The, 7.550%, 03/01/47 |
|
|
970,000 |
|
|
|
1,024,950 |
|
Methanex Corp., |
|
|
|
|
|
|
|
|
5.250%, 03/01/22 |
|
|
350,000 |
|
|
|
363,128 |
|
6.000%, 08/15/15 |
|
|
3,825,000 |
|
|
|
4,054,270 |
|
Micron Technology, Inc., 1.875%, 06/01/145 |
|
|
200,000 |
|
|
|
196,000 |
|
Missouri Pacific Railroad Co., 5.000%, 01/01/453 |
|
|
825,000 |
|
|
|
731,915 |
|
New Albertsons, Inc., |
|
|
|
|
|
|
|
|
6.625%, 06/01/28 |
|
|
1,015,000 |
|
|
|
700,350 |
|
7.450%, 08/01/29 |
|
|
3,195,000 |
|
|
|
2,348,325 |
|
7.750%, 06/15/26 |
|
|
915,000 |
|
|
|
722,850 |
|
NGPL PipeCo LLC, 7.119%, 12/15/17 (a)4 |
|
|
21,980,000 |
|
|
|
21,980,000 |
|
Northwest Airlines, 2007-1 Class B Pass Through Trust, Series 41091, 8.028%, 11/01/17 |
|
|
5,126,882 |
|
|
|
5,178,151 |
|
ONEOK, Inc., 6.000%, 06/15/35 |
|
|
9,210,000 |
|
|
|
10,050,716 |
|
Owens & Minor, Inc., 6.350%, 04/15/163 |
|
|
1,355,000 |
|
|
|
1,479,371 |
|
Owens Corning, |
|
|
|
|
|
|
|
|
6.500%, 12/01/16 |
|
|
4,560,000 |
|
|
|
5,070,360 |
|
7.000%, 12/01/36 |
|
|
9,175,000 |
|
|
|
9,750,685 |
|
Panhandle Eastern Pipeline Co., L.P., |
|
|
|
|
|
|
|
|
6.200%, 11/01/17 |
|
|
5,520,000 |
|
|
|
6,318,093 |
|
7.000%, 06/15/18 |
|
|
26,505,000 |
|
|
|
31,411,288 |
|
|
The accompanying
notes are an integral part of these financial statements. 11 |
Managers Bond Fund
Schedule of
Portfolio Investments (continued)
|
|
|
|
|
|
|
|
|
|
|
Principal Amount |
|
|
Value |
|
Industrials - 30.6% (continued) |
|
|
|
|
|
|
|
|
Plains All American Pipeline L.P./PAA Finance Corp., |
|
|
|
|
|
|
|
|
6.125%, 01/15/17 |
|
$ |
2,770,000 |
|
|
$ |
3,220,383 |
|
6.500%, 05/01/18 |
|
|
8,975,000 |
|
|
|
10,767,999 |
|
PulteGroup, Inc., |
|
|
|
|
|
|
|
|
6.000%, 02/15/35 |
|
|
10,320,000 |
|
|
|
8,256,000 |
|
6.375%, 05/15/33 |
|
|
4,670,000 |
|
|
|
3,852,750 |
|
Qwest Capital Funding, Inc., |
|
|
|
|
|
|
|
|
6.500%, 11/15/18 |
|
|
620,000 |
|
|
|
658,960 |
|
6.875%, 07/15/28 |
|
|
1,190,000 |
|
|
|
1,147,304 |
|
7.625%, 08/03/21 |
|
|
2,135,000 |
|
|
|
2,207,443 |
|
Qwest Corp., |
|
|
|
|
|
|
|
|
6.875%, 09/15/33 |
|
|
7,209,000 |
|
|
|
7,172,955 |
|
7.200%, 11/10/26 |
|
|
435,000 |
|
|
|
439,350 |
|
7.250%, 09/15/25 |
|
|
1,185,000 |
|
|
|
1,300,360 |
|
7.250%, 10/15/35 |
|
|
2,165,000 |
|
|
|
2,181,237 |
|
7.500%, 06/15/23 |
|
|
739,000 |
|
|
|
743,064 |
|
Reliance Holdings USA, Inc., 5.400%, 02/14/22 (a) |
|
|
3,250,000 |
|
|
|
3,249,802 |
|
Reynolds American, Inc., |
|
|
|
|
|
|
|
|
6.750%, 06/15/17 |
|
|
8,170,000 |
|
|
|
9,808,657 |
|
7.250%, 06/15/37 |
|
|
2,000,000 |
|
|
|
2,416,914 |
|
Rowan Cos., Inc., 7.875%, 08/01/19 |
|
|
4,710,000 |
|
|
|
5,685,742 |
|
RR Donnelley & Sons Co., 8.250%, 03/15/19 |
|
|
2,230,000 |
|
|
|
2,185,400 |
|
Samsung Electronics Co., Ltd., 7.700%, 10/01/27 (a) |
|
|
3,520,000 |
|
|
|
4,266,733 |
|
Telecom Italia Capital SA, |
|
|
|
|
|
|
|
|
6.000%, 09/30/34 |
|
|
4,790,000 |
|
|
|
3,676,325 |
|
6.375%, 11/15/33 |
|
|
3,870,000 |
|
|
|
3,037,950 |
|
Telekom Malaysia Bhd, 7.875%, 08/01/25 (a) |
|
|
250,000 |
|
|
|
338,954 |
|
Texas Eastern Transmission, L.P., 6.000%, 09/15/17 (a) |
|
|
3,000,000 |
|
|
|
3,473,373 |
|
Toro Co., The, 6.625%, 05/01/373 |
|
|
6,810,000 |
|
|
|
7,211,960 |
|
Transocean, Inc., 7.375%, 04/15/18 |
|
|
500,000 |
|
|
|
587,624 |
|
UAL, Series 2007-1, 6.636%, 07/02/22 |
|
|
14,524,999 |
|
|
|
15,178,624 |
|
United States Steel Corp., |
|
|
|
|
|
|
|
|
6.650%, 06/01/374 |
|
|
3,595,000 |
|
|
|
2,804,100 |
|
7.000%, 02/01/184 |
|
|
7,310,000 |
|
|
|
7,218,625 |
|
US Airways, 2011-1 Class A Pass Through Trust, Series 2011 A, 7.125%, 10/22/23 |
|
|
3,781,265 |
|
|
|
4,008,141 |
|
USG Corp., 6.300%, 11/15/16 |
|
|
1,410,000 |
|
|
|
1,350,075 |
|
Vale Overseas Ltd., 6.875%, 11/21/36 |
|
|
3,665,000 |
|
|
|
4,251,231 |
|
Verizon Maryland, Inc., 5.125%, 06/15/33 |
|
|
505,000 |
|
|
|
522,651 |
|
Verizon New England, Inc., 7.875%, 11/15/29 |
|
|
2,390,000 |
|
|
|
2,925,802 |
|
Verizon Pennsylvania, Inc., 6.000%, 12/01/28 |
|
|
1,335,000 |
|
|
|
1,458,497 |
|
Western Union Co., The, |
|
|
|
|
|
|
|
|
6.200%, 11/17/36 |
|
|
1,180,000 |
|
|
|
1,255,961 |
|
6.200%, 06/21/40 |
|
|
130,000 |
|
|
|
141,399 |
|
|
The accompanying
notes are an integral part of these financial statements. 12 |
Managers Bond Fund
Schedule of
Portfolio Investments (continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal Amount |
|
|
Value |
|
Industrials - 30.6% (continued) |
|
|
|
|
|
|
|
|
|
|
Weyerhaeuser Co., |
|
|
|
|
|
|
|
|
|
|
6.875%, 12/15/33 |
|
|
|
$ |
12,890,000 |
|
|
$ |
13,587,362 |
|
7.375%, 10/01/194 |
|
|
|
|
3,915,000 |
|
|
|
4,627,326 |
|
7.375%, 03/15/32 |
|
|
|
|
1,930,000 |
|
|
|
2,155,677 |
|
White Pine Hydro LLC, |
|
|
|
|
|
|
|
|
|
|
6.310%, 07/10/17 (a)3 |
|
|
|
|
1,700,000 |
|
|
|
1,417,222 |
|
6.960%, 07/10/37 (a)3 |
|
|
|
|
1,645,000 |
|
|
|
1,121,676 |
|
Wyndham Worldwide Corp., |
|
|
|
|
|
|
|
|
|
|
5.750%, 02/01/18 |
|
|
|
|
950,000 |
|
|
|
1,056,267 |
|
6.000%, 12/01/16 |
|
|
|
|
6,430,000 |
|
|
|
7,152,655 |
|
7.375%, 03/01/20 |
|
|
|
|
7,220,000 |
|
|
|
8,582,031 |
|
Total Industrials |
|
|
|
|
|
|
|
|
706,192,130 |
|
Utilities - 9.5% |
|
|
|
|
|
|
|
|
|
|
Abu Dhabi National Energy Co., 7.250%, 08/01/18 (a) |
|
|
|
|
21,130,000 |
|
|
|
25,065,462 |
|
Ameren Energy Generating Co., Series H, 7.000%, 04/15/184 |
|
|
|
|
15,300,000 |
|
|
|
13,234,500 |
|
Ameren Illinois Co., 6.250%, 04/01/18 |
|
|
|
|
26,000,000 |
|
|
|
30,767,542 |
|
Bruce Mansfield Unit, 6.850%, 06/01/34 |
|
|
|
|
9,994,601 |
|
|
|
10,408,378 |
|
Cleveland Electric Illuminating Co., The, 5.950%, 12/15/36 |
|
|
|
|
8,360,000 |
|
|
|
9,451,365 |
|
DCP Midstream LLC, 6.450%, 11/03/36 (a) |
|
|
|
|
870,000 |
|
|
|
1,031,621 |
|
Endesa SA/Cayman Islands, 7.875%, 02/01/27 |
|
|
|
|
2,900,000 |
|
|
|
3,570,863 |
|
Enel Finance International N.V., |
|
|
|
|
|
|
|
|
|
|
5.125%, 10/07/19 (a) |
|
|
|
|
3,700,000 |
|
|
|
3,534,473 |
|
6.000%, 10/07/39 (a) |
|
|
|
|
18,672,000 |
|
|
|
14,658,603 |
|
ITC Holdings Corp., 5.875%, 09/30/16 (a) |
|
|
|
|
2,410,000 |
|
|
|
2,769,321 |
|
Mackinaw Power LLC, 6.296%, 10/31/23 (a)3 |
|
|
|
|
8,014,200 |
|
|
|
8,159,017 |
|
Nisource Finance Corp., |
|
|
|
|
|
|
|
|
|
|
6.400%, 03/15/18 |
|
|
|
|
27,910,000 |
|
|
|
32,601,615 |
|
6.800%, 01/15/19 |
|
|
|
|
11,625,000 |
|
|
|
13,936,329 |
|
Southwestern Electric Power Co., 6.450%, 01/15/19 |
|
|
|
|
39,195,000 |
|
|
|
47,286,063 |
|
Tenaga Nasional Bhd, 7.500%, 11/01/25 (a) |
|
|
|
|
2,000,000 |
|
|
|
2,540,456 |
|
Total Utilities |
|
|
|
|
|
|
|
|
219,015,608 |
|
Total Corporate Bonds and Notes (cost $1,390,072,686) |
|
|
|
|
|
|
|
|
1,521,874,983 |
|
Foreign Government and Agency Obligations - 6.3% |
|
|
|
|
|
|
|
|
|
|
Alberta Notes, Province of, 5.930%, 09/16/16 |
|
CAD |
|
|
95,135 |
|
|
|
102,668 |
|
Brazil Bonds, Republic of, 10.250%, 01/10/28 |
|
BRL |
|
|
5,750,000 |
|
|
|
3,557,070 |
|
Brazilian Government International Bond, 8.500%, 01/05/24 |
|
BRL |
|
|
6,650,000 |
|
|
|
3,608,912 |
|
Canadian Government Notes, |
|
|
|
|
|
|
|
|
|
|
1.750%, 03/01/13 |
|
CAD |
|
|
400,000 |
|
|
|
394,889 |
|
2.500%, 06/01/15 |
|
CAD |
|
|
14,775,000 |
|
|
|
15,089,192 |
|
3.000%, 12/01/15 |
|
CAD |
|
|
15,225,000 |
|
|
|
15,864,746 |
|
3.500%, 06/01/13 |
|
CAD |
|
|
5,964,000 |
|
|
|
5,991,005 |
|
European Bank for Reconstruction & Development Notes, 9.250%, 09/10/12 |
|
BRL |
|
|
2,000,000 |
|
|
|
997,560 |
|
|
The accompanying
notes are an integral part of these financial statements. 13 |
Managers Bond Fund
Schedule of
Portfolio Investments (continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal Amount |
|
|
Value |
|
Foreign Government and Agency Obligations - 6.3% (continued) |
|
|
|
|
|
|
|
|
|
|
|
|
European Investment Bank, |
|
|
|
|
|
|
|
|
|
|
|
|
Bonds, 5.778%, 03/10/216 |
|
|
AUD |
|
|
|
5,000,000 |
|
|
$ |
3,318,979 |
|
Notes, 6.675%, 04/24/13 (a)6 |
|
|
IDR |
|
|
|
50,074,770,000 |
|
|
|
4,990,363 |
|
Notes, 11.250%, 02/14/13 |
|
|
BRL |
|
|
|
13,490,000 |
|
|
|
6,893,769 |
|
Iceland Government International Bonds, 5.875%, 05/11/22 |
|
|
|
|
|
|
5,800,000 |
|
|
|
5,624,730 |
|
Inter-American Development Bank, |
|
|
|
|
|
|
|
|
|
|
|
|
Bonds, 6.000%, 12/15/17 |
|
|
NZD |
|
|
|
4,215,000 |
|
|
|
3,749,292 |
|
Notes, 6.269%, 05/20/136 |
|
|
IDR |
|
|
|
45,580,000,000 |
|
|
|
4,565,037 |
|
Notes, EMTN, 6.393%, 09/23/136 |
|
|
IDR |
|
|
|
33,430,000,000 |
|
|
|
3,265,587 |
|
International Bank for Reconstruction & Development Notes, GDIF, 1.430%, 03/05/14 |
|
|
SGD |
|
|
|
5,800,000 |
|
|
|
4,624,616 |
|
Ireland Government Bonds, |
|
|
|
|
|
|
|
|
|
|
|
|
4.500%, 04/18/20 |
|
|
EUR |
|
|
|
1,655,000 |
|
|
|
1,862,933 |
|
5.000%, 10/18/20 |
|
|
EUR |
|
|
|
995,000 |
|
|
|
1,146,449 |
|
Manitoba Bonds, Province of, 6.375%, 09/01/15 |
|
|
NZD |
|
|
|
5,450,000 |
|
|
|
4,700,489 |
|
Mexican Fixed Rate Bonds, 8.000%, 12/07/23 |
|
|
MXN |
|
|
|
141,360,000 |
|
|
|
12,812,304 |
|
New South Wales Treasury Corp., Series 813, 5.500%, 08/01/13 |
|
|
AUD |
|
|
|
21,225,000 |
|
|
|
22,271,000 |
|
Norway Government Bonds, 6.500%, 05/15/13 |
|
|
NOK |
|
|
|
53,065,000 |
|
|
|
9,297,849 |
|
Queensland Treasury Corp. Bonds, 7.125%, 09/18/17 (a) |
|
|
NZD |
|
|
|
7,500,000 |
|
|
|
6,859,958 |
|
Singapore Government Bond, 1.375%, 10/01/14 |
|
|
SGD |
|
|
|
4,400,000 |
|
|
|
3,566,989 |
|
Total Foreign Government and Agency Obligations (cost $139,108,567) |
|
|
|
|
|
|
|
|
|
|
145,156,386 |
|
Mortgage-Backed Securities - 1.1% |
|
|
|
|
|
|
|
|
|
|
|
|
Community Program Loan Trust, Series 87-A, Class A5, 4.500%, 04/01/29 |
|
|
|
|
|
|
3,257,968 |
|
|
|
3,294,327 |
|
Credit Suisse Mortgage Capital Certificates, Series 2007-C5, Class A4, 5.695%, 09/15/402 |
|
|
|
|
|
|
1,704,000 |
|
|
|
1,827,547 |
|
Extended Stay America Trust, Series 2010 ESHA, Class C, 4.860%, 11/05/27 (a) |
|
|
|
|
|
|
19,090,000 |
|
|
|
19,299,570 |
|
JPMorgan Chase Commercial Mortgage Securities Corp., Series 2007-LD11, Class A4, 6.009%, 06/15/492 |
|
|
|
|
|
|
80,000 |
|
|
|
87,824 |
|
Total Mortgage-Backed Securities (cost $22,967,500) |
|
|
|
|
|
|
|
|
|
|
24,509,268 |
|
|
|
|
|
Municipal Bonds - 1.0% |
|
|
|
|
|
|
|
|
|
|
|
|
Buckeye Tobacco Settlement Financing Authority, Series 2007 A-2, 5.875%, 06/01/473 |
|
|
|
|
|
|
5,035,000 |
|
|
|
3,853,990 |
|
Chicago Illinois OHare International Airport Revenue Bond, Series 2008-A, 4.500%, 01/01/38 (AGM Insured)7 |
|
|
|
|
|
|
315,000 |
|
|
|
322,223 |
|
Illinois State General Obligation, Series 2003, 5.100%, 06/01/33 |
|
|
|
|
|
|
2,880,000 |
|
|
|
2,722,176 |
|
Michigan Tobacco Settlement Finance Authority, Series 2006 A, 7.309%, 06/01/343 |
|
|
|
|
|
|
2,950,000 |
|
|
|
2,185,862 |
|
San Jose, California Redevelopment Agency Tax Allocation, Series 2006 C, 3.750%, 08/01/28 (NATL-RE Insured)7 |
|
|
|
|
|
|
765,000 |
|
|
|
626,902 |
|
San Jose, California Redevelopment Agency Tax Allocation, Series 2006 C, 3.750%, 08/01/28 (BHAC Insured)7 |
|
|
|
|
|
|
280,000 |
|
|
|
260,711 |
|
Virginia Tobacco Settlement Financing Corp., Series 2007 A-1, 6.706%, 06/01/463 |
|
|
|
|
|
|
21,620,000 |
|
|
|
13,821,882 |
|
Total Municipal Bonds (cost $32,358,680) |
|
|
|
|
|
|
|
|
|
|
23,793,746 |
|
|
|
|
|
|
|
|
|
|
Shares |
|
|
|
|
Preferred Stocks - 0.7% |
|
|
|
|
|
|
|
|
|
|
|
|
Consumer Discretionary - 0.2% |
|
|
|
|
|
|
|
|
|
|
|
|
Newell Financial Trust I, 5.250%5 |
|
|
|
|
|
|
90,628 |
|
|
|
4,554,057 |
|
|
The accompanying
notes are an integral part of these financial statements. 14 |
Managers Bond Fund
Schedule of
Portfolio Investments (continued)
|
|
|
|
|
|
|
|
|
|
|
Shares |
|
|
Value |
|
Preferred Stocks - 0.7% (continued) |
|
|
|
|
|
|
|
|
Financials - 0.5% |
|
|
|
|
|
|
|
|
Bank of America Corp., 6.375% |
|
|
20,000 |
|
|
$ |
488,000 |
|
Bank of America Corp., Series L, 7.250%5 |
|
|
7,808 |
|
|
|
7,612,800 |
|
SLM Corp., 6.000% |
|
|
41,250 |
|
|
|
895,950 |
|
Sovereign Capital Trust IV, 4.375%5 |
|
|
34,236 |
|
|
|
1,737,477 |
|
Total Financials |
|
|
|
|
|
|
10,734,227 |
|
Utilities - 0.0%# |
|
|
|
|
|
|
|
|
Entergy New Orleans, Inc., 4.750% |
|
|
482 |
|
|
|
46,031 |
|
Entergy New Orleans, Inc., 5.560% |
|
|
100 |
|
|
|
9,925 |
|
Wisconsin Electric Power Co., 3.600% |
|
|
3,946 |
|
|
|
318,146 |
|
Total Utilities |
|
|
|
|
|
|
374,102 |
|
Total Preferred Stocks (cost $13,659,783) |
|
|
|
|
|
|
15,662,386 |
|
|
|
|
|
|
Principal Amount |
|
|
|
|
U.S. Government and Agency Obligations - 19.0% |
|
|
|
|
|
|
|
|
Federal Home Loan Banks - 0.7% |
|
|
|
|
|
|
|
|
FHLB, 1.875%, 06/21/13 |
|
$ |
16,600,000 |
|
|
|
16,859,840 |
|
Federal Home Loan Mortgage Corporation - 1.8% |
|
|
|
|
|
|
|
|
FHLMC, 1.625%, 04/15/13 |
|
|
16,595,000 |
|
|
|
16,772,749 |
|
FHLMC, 2.125%, 09/21/12 |
|
|
24,895,000 |
|
|
|
25,002,820 |
|
FHMLC Gold, 5.000%, 12/01/31 |
|
|
77,106 |
|
|
|
83,127 |
|
Total Federal Home Loan Mortgage Corporation |
|
|
|
|
|
|
41,858,696 |
|
Federal National Mortgage Association - 0.3% |
|
|
|
|
|
|
|
|
FNMA, 3.000%, 07/01/27 |
|
|
5,000,000 |
|
|
|
5,247,360 |
|
FNMA, 4.000%, 10/01/18 |
|
|
1,145,929 |
|
|
|
1,227,651 |
|
FNMA, 6.000%, 07/01/29 |
|
|
6,150 |
|
|
|
6,900 |
|
Total Federal National Mortgage Association |
|
|
|
|
|
|
6,481,911 |
|
U.S. Treasury Obligations - 16.2% |
|
|
|
|
|
|
|
|
U.S. Treasury Notes, 0.250%, 02/28/14 |
|
|
150,000,000 |
|
|
|
149,847,600 |
|
U.S. Treasury Notes, 0.250%, 05/31/14 |
|
|
225,000,000 |
|
|
|
224,718,750 |
|
Total U.S. Treasury Obligations |
|
|
|
|
|
|
374,566,350 |
|
Total U.S. Government and Agency Obligations (cost $439,284,047) |
|
|
|
|
|
|
439,766,797 |
|
|
|
|
|
|
Shares |
|
|
|
|
Other Investment Companies - 4.4%8 |
|
|
|
|
|
|
|
|
BNY Mellon Overnight Government Fund, 0.18%9 |
|
|
69,181,345 |
|
|
|
69,181,345 |
|
Dreyfus Cash Management Fund, Institutional Class Shares, 0.08% |
|
|
32,644,313 |
|
|
|
32,644,313 |
|
Total Other Investment Companies
(cost $101,825,658) |
|
|
|
|
|
|
101,825,658 |
|
Total Investments - 102.0% (cost $2,214,038,188) |
|
|
|
|
|
|
2,355,852,322 |
|
Other Assets, less Liabilities - (2.0)% |
|
|
|
|
|
|
(46,941,967 |
) |
Net Assets - 100.0% |
|
|
|
|
|
$ |
2,308,910,355 |
|
|
The accompanying
notes are an integral part of these financial statements. 15 |
Notes to Schedule of Portfolio Investments (unaudited)
The following footnotes and abbreviations should
be read in conjunction with the Schedule of Portfolio Investments previously presented in this report.
Based on the approximate cost of
investments of $2,214,038,188 for Federal income tax purposes at June 30, 2012, the aggregate gross unrealized appreciation and depreciation were $177,965,337 and $36,151,203, respectively, resulting in net unrealized appreciation of
investments of $141,814,134.
# |
Rounds to less than 0.1%. |
(a) |
Security exempt from registration under Rule 144A of the Securities Act of 1933. This security may be resold in transactions exempt from registration, normally to
qualified buyers. At June 30, 2012, the value of these securities amounted to $363,991,924, or 15.7% of net assets. |
1 |
Floating Rate Security. The rate listed is as of June 30, 2012. Date in parentheses represents the securitys next coupon rate reset.
|
2 |
Variable Rate Security. The rate listed is as of June 30, 2012, and is periodically reset subject to terms and conditions set forth in the
debenture. |
3 |
Illiquid Security. A security not readily convertible into cash such as a stock, bond or commodity that is not actively traded and would be difficult
to sell in a current sale. The Fund may not invest more than 15% of its net assets in illiquid securities. Illiquid securities at December 31, 2011, amounted to $50,819,512, or 2.2% of net assets. |
4 |
Some or all of these securities, amounting to a market value of $66,683,381, or 2.9% of net assets, were out on loan to various brokers.
|
5 |
Convertible Security. A corporate bond or preferred stock, usually a junior debenture, that can be converted, at the option of the holder, for a
specific number of shares of the companys preferred stock or common stock. Convertible Bonds and Convertible Preferred Stocks at June 30, 2012, amounted to $41,579,312, or 1.8% of net assets, and $13,904,334, or 0.6% of net assets,
respectively. |
6 |
Represents yield to maturity at June 30, 2012. |
7 |
Securities in the portfolio backed by insurance of financial institutions and financial guaranty assurance agencies amounted to $1,209,836, or 0.1% of
net assets. |
8 |
Yield shown represents the June 30, 2012, seven-day average yield, which refers to the sum of the previous seven days dividends paid,
expressed as an annual percentage. |
9 |
Collateral received from brokers for securities lending was invested in this short-term investment. |
The following table summarizes the inputs used to value the Funds net assets by the fair value hierarchy levels as of June 30, 2012: (See Note
1(a) in the Notes to the Financial Statements.)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quoted Prices in Active Markets for Identical Investments Level 1 |
|
|
Significant Other Observable Inputs Level 2 |
|
|
Significant Unobservable Inputs Level 3 |
|
|
Total |
|
Managers Bond Fund |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments in Securities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset-Backed Securities |
|
|
|
|
|
$ |
56,343,294 |
|
|
|
|
|
|
$ |
56,343,294 |
|
Bank Loan Obligations |
|
|
|
|
|
|
11,454,300 |
|
|
|
|
|
|
|
11,454,300 |
|
Common Stocks |
|
$ |
15,465,504 |
|
|
|
|
|
|
|
|
|
|
|
15,465,504 |
|
Corporate Bonds and Notes |
|
|
|
|
|
|
1,521,874,983 |
|
|
|
|
|
|
|
1,521,874,983 |
|
Foreign Government and Agency Obligations |
|
|
|
|
|
|
145,156,386 |
|
|
|
|
|
|
|
145,156,386 |
|
Mortgage-Backed Securities |
|
|
|
|
|
|
24,509,268 |
|
|
|
|
|
|
|
24,509,268 |
|
Municipal Bonds |
|
|
|
|
|
|
23,793,746 |
|
|
|
|
|
|
|
23,793,746 |
|
Preferred Stocks |
|
|
15,662,386 |
|
|
|
|
|
|
|
|
|
|
|
15,662,386 |
|
U.S. Government and Agency Obligations |
|
|
|
|
|
|
439,766,797 |
|
|
|
|
|
|
|
439,766,797 |
|
Other Investment Companies |
|
|
101,825,658 |
|
|
|
|
|
|
|
|
|
|
|
101,825,658 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Investments in Securities |
|
$ |
132,953,548 |
|
|
$ |
2,222,898,774 |
|
|
|
|
|
|
$ |
2,355,852,322 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All common stocks and preferred stocks held in the Fund are level 1 securities. For a detailed breakout of these securities, please refer to the
Schedule of Portfolio Investments. |
|
All corporate
bonds, notes and U.S. government and agency obligations held in the Fund are level 2 securities. For a detailed breakout of the corporate bonds and notes and U.S. government and agency obligations by major industry or agency classification, please
refer to the Schedule of Portfolio Investments. |
As of June 30, 2012, the Fund had no transfers between Level 1 and
Level 2 from the beginning of the reporting period.
|
The accompanying
notes are an integral part of these financial statements. 16 |
Notes to Schedule of Portfolio Investments (continued)
|
|
|
Investment Abbreviations and Definitions:
|
AGM: |
|
Assured Guaranty Municipal Corp. |
BHAC: |
|
Berkshire Hathaway Assurance Corp. |
EMTN: |
|
European Medium-Term Note |
FHLB: |
|
Federal Home Loan Bank |
FHLMC: |
|
Federal Home Loan Mortgage Corp. |
FNMA: |
|
Federal National Mortgage Association |
GMTN: |
|
Global Multi-Currency Notes |
MBIA: |
|
MBIA Insurance Corp. |
MTN: |
|
Medium-Term Note |
NATL-RE: |
|
National Public Finance Guarantee Corporation |
Currency abbreviations have been used throughout the portfolio to indicate amounts shown in currencies other than the
U.S. dollar (USD):
|
|
|
AUD: |
|
Australian Dollar |
BRL: |
|
Brazilian Real |
CAD: |
|
Canadian Dollar |
EUR: |
|
Euro |
IDR: |
|
Indonesian Rupiah |
MXN: |
|
Mexican Peso |
NOK: |
|
Norwegian Krone |
NZD: |
|
New Zealand Dollar |
SGD: |
|
Singapore Dollar |
|
The accompanying
notes are an integral part of these financial statements. 17 |
Statement of Assets and Liabilities
June 30, 2012 (unaudited)
|
|
|
|
|
Assets: |
|
|
|
|
Investments at value* (including securities on loan valued at $66,683,381) |
|
$ |
2,355,852,322 |
|
Dividends, interest and other receivables |
|
|
25,146,319 |
|
Receivable for Fund shares sold |
|
|
5,603,376 |
|
Receivable for investments sold |
|
|
3,648,312 |
|
Receivable from affiliate |
|
|
121,909 |
|
Prepaid expenses |
|
|
147,404 |
|
Total assets |
|
|
2,390,519,642 |
|
Liabilities: |
|
|
|
|
Payable upon return of securities loaned |
|
|
69,181,345 |
|
Payable for investments purchased |
|
|
6,147,895 |
|
Payable for Fund shares repurchased |
|
|
3,592,752 |
|
Foreign currency payable (cost $410,576) |
|
|
428,586 |
|
Accrued expenses: |
|
|
|
|
Investment advisory and management fees |
|
|
1,172,954 |
|
Administrative fees |
|
|
469,981 |
|
Other |
|
|
615,774 |
|
Total liabilities |
|
|
81,609,287 |
|
|
|
Net Assets |
|
$ |
2,308,910,355 |
|
Net Assets Represent: |
|
|
|
|
Paid-in capital |
|
$ |
2,199,026,250 |
|
Undistributed net investment income |
|
|
210,156 |
|
Accumulated net realized loss from investments and foreign currency transactions |
|
|
(32,081,305 |
) |
Net unrealized appreciation of investments and foreign currency translations |
|
|
141,755,254 |
|
Net Assets |
|
$ |
2,308,910,355 |
|
Shares outstanding |
|
|
86,134,839 |
|
Net asset value, offering and redemption price per share |
|
$ |
26.81 |
|
* Investments at cost |
|
$ |
2,214,038,188 |
|
|
The accompanying
notes are an integral part of these financial statements. 18 |
Statement of Operations
For the six months ended June 30, 2012 (unaudited)
|
|
|
|
|
Investment Income: |
|
|
|
|
Interest income |
|
$ |
54,637,094 |
|
Dividend income |
|
|
943,172 |
|
Securities lending income |
|
|
308,058 |
|
Total investment income |
|
|
55,888,324 |
|
Expenses: |
|
|
|
|
Investment advisory and management fees |
|
|
6,931,910 |
|
Administrative fees |
|
|
2,772,764 |
|
Transfer agent |
|
|
1,297,749 |
|
Professional fees |
|
|
156,598 |
|
Custodian |
|
|
149,386 |
|
Reports to shareholders |
|
|
126,375 |
|
Trustees fees and expenses |
|
|
87,014 |
|
Registration fees |
|
|
76,615 |
|
Miscellaneous |
|
|
43,592 |
|
Total expenses before offsets |
|
|
11,642,003 |
|
Expense reimbursements |
|
|
(661,569 |
) |
Fee waivers |
|
|
(23,617 |
) |
Expense reductions |
|
|
(288 |
) |
Net expenses |
|
|
10,956,529 |
|
|
|
Net investment income |
|
|
44,931,795 |
|
Net Realized and Unrealized Gain (Loss): |
|
|
|
|
Net realized gain on investments |
|
|
28,549,880 |
|
Net realized gain on foreign currency transactions |
|
|
1,109,903 |
|
Net change in unrealized appreciation (depreciation) of investments |
|
|
39,325,151 |
|
Net change in unrealized appreciation (depreciation) of foreign currency translations |
|
|
(219,903 |
) |
Net realized and unrealized gain |
|
|
68,765,031 |
|
|
|
Net increase in net assets resulting from operations |
|
$ |
113,696,826 |
|
|
The accompanying
notes are an integral part of these financial statements. 19 |
Statements of Changes in Net Assets
For the six months ended June 30, 2012 (unaudited) and the year ended December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
2012 |
|
|
2011 |
|
Increase (Decrease) in Net Assets From Operations: |
|
|
|
|
|
|
|
|
Net investment income |
|
$ |
44,931,795 |
|
|
$ |
89,187,692 |
|
Net realized gain on investments and foreign currency transactions |
|
|
29,659,783 |
|
|
|
24,677,946 |
|
Net change in unrealized appreciation (depreciation) of investments and foreign currency translations |
|
|
39,105,248 |
|
|
|
3,364,692 |
|
Net increase in net assets resulting from operations |
|
|
113,696,826 |
|
|
|
117,230,330 |
|
Distributions to Shareholders: |
|
|
|
|
|
|
|
|
From net investment income |
|
|
(44,865,597 |
) |
|
|
(91,439,318 |
) |
From Capital Share Transactions: |
|
|
|
|
|
|
|
|
Proceeds from sale of shares |
|
|
347,007,633 |
|
|
|
675,736,563 |
|
Reinvestment of dividends and distributions |
|
|
40,531,746 |
|
|
|
83,384,606 |
|
Cost of shares repurchased |
|
|
(268,951,121 |
) |
|
|
(649,797,137 |
) |
Net increase from capital share transactions |
|
|
118,588,258 |
|
|
|
109,324,032 |
|
|
|
|
Total increase in net assets |
|
|
187,419,487 |
|
|
|
135,115,044 |
|
Net Assets: |
|
|
|
|
|
|
|
|
Beginning of period |
|
|
2,121,490,868 |
|
|
|
1,986,375,824 |
|
End of period |
|
$ |
2,308,910,355 |
|
|
$ |
2,121,490,868 |
|
End of period undistributed net investment income |
|
$ |
210,156 |
|
|
$ |
143,958 |
|
|
|
|
|
|
|
|
|
|
Share Transactions: |
|
|
|
|
|
|
|
|
Sale of shares |
|
|
13,015,546 |
|
|
|
25,821,719 |
|
Shares issued in connection with reinvestments of dividends and distributions |
|
|
1,520,577 |
|
|
|
3,201,464 |
|
Shares repurchased |
|
|
(10,105,613 |
) |
|
|
(24,893,267 |
) |
Net increase in shares |
|
|
4,430,510 |
|
|
|
4,129,916 |
|
|
The accompanying
notes are an integral part of these financial statements. 20 |
Managers Bond Fund
Financial Highlights
For a share outstanding throughout each period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the six months ended June 30, 2012 (unaudited) |
|
|
For the year ended December 31, |
|
|
|
2011 |
|
|
2010 |
|
|
2009 |
|
|
2008 |
|
|
2007 |
|
Net Asset Value, Beginning of Year |
|
$ |
25.97 |
|
|
$ |
25.61 |
|
|
$ |
24.29 |
|
|
$ |
19.65 |
|
|
$ |
25.34 |
|
|
$ |
24.84 |
|
Income from Investment Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income1 |
|
|
0.54 |
|
|
|
1.14 |
|
|
|
1.16 |
|
|
|
1.30 |
|
|
|
1.42 |
|
|
|
1.22 |
|
Net realized and unrealized gain (loss) on investments1 |
|
|
0.84 |
|
|
|
0.39 |
|
|
|
1.34 |
|
|
|
4.62 |
|
|
|
(5.42 |
) |
|
|
0.49 |
|
Total from investment operations |
|
|
1.38 |
|
|
|
1.53 |
|
|
|
2.50 |
|
|
|
5.92 |
|
|
|
(4.00 |
) |
|
|
1.71 |
|
Less Distributions to Shareholders from: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income |
|
|
(0.54 |
) |
|
|
(1.17 |
) |
|
|
(1.18 |
) |
|
|
(1.28 |
) |
|
|
(1.41 |
) |
|
|
(1.21 |
) |
Net realized gain on investments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(0.28 |
) |
|
|
(0.00 |
)# |
Total distributions to shareholders |
|
|
(0.54 |
) |
|
|
(1.17 |
) |
|
|
(1.18 |
) |
|
|
(1.28 |
) |
|
|
(1.69 |
) |
|
|
(1.21 |
) |
Net Asset Value, End of Year |
|
$ |
26.81 |
|
|
$ |
25.97 |
|
|
$ |
25.61 |
|
|
$ |
24.29 |
|
|
$ |
19.65 |
|
|
$ |
25.34 |
|
Total Return2 |
|
|
5.33 |
%5 |
|
|
6.06 |
% |
|
|
10.47 |
%4 |
|
|
31.12 |
%4 |
|
|
(16.31 |
)% |
|
|
7.06 |
% |
Ratio of net expenses to average net assets |
|
|
0.99 |
%6 |
|
|
0.99 |
% |
|
|
0.99 |
% |
|
|
0.99 |
% |
|
|
0.99 |
% |
|
|
0.99 |
% |
Ratio of net investment income to average net assets2 |
|
|
4.05 |
%6 |
|
|
4.36 |
% |
|
|
4.59 |
% |
|
|
5.93 |
% |
|
|
6.10 |
% |
|
|
4.91 |
% |
Portfolio turnover |
|
|
14 |
%5 |
|
|
17 |
% |
|
|
17 |
% |
|
|
23 |
% |
|
|
39 |
% |
|
|
21 |
% |
Net assets at end of year (000s omitted) |
|
$ |
2,308,910 |
|
|
$ |
2,121,491 |
|
|
$ |
1,986,376 |
|
|
$ |
2,193,702 |
|
|
$ |
1,888,919 |
|
|
$ |
2,022,891 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratios absent expense offsets:3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratio of total expenses to average net assets |
|
|
1.05 |
%6 |
|
|
1.05 |
% |
|
|
1.06 |
% |
|
|
1.10 |
% |
|
|
1.10 |
% |
|
|
0.99 |
% |
Ratio of net investment income to average net assets |
|
|
3.99 |
%6 |
|
|
4.30 |
% |
|
|
4.52 |
% |
|
|
5.82 |
% |
|
|
5.99 |
% |
|
|
4.91 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes to Financial Highlights (unaudited)
The following footnotes should be read in conjunction with the Financial Highlights of the Fund previously presented in this report.
# |
Rounds to less than $0.01 per share or 0.01%. |
1 |
Per share numbers have been calculated using average shares. |
2 |
Total returns and net investment income would have been lower had certain expenses not been reduced. (See Note 1(c) of Notes to Financial Statements.)
|
3 |
Excludes the impact of expense reimbursements or fee waivers and expense reductions such as brokerage credits, but includes expense repayments and
non-reimbursable expenses, if any, such as interest and taxes. (See Note 1(c) of Notes to Financial Statements.) |
4 |
The Total Return is based on the Financial Statement Net Asset Values as shown above. |
Notes to Financial Statements
June 30, 2012 (unaudited)
1. |
Summary of Significant Accounting Policies |
The Managers Funds (the Trust) is an open-end management investment company organized as a Massachusetts business trust and registered under the Investment Company Act of 1940, as amended (the
1940 Act). Currently, the Trust consists of a number of different funds, each having distinct investment management objectives, strategies, risks, and policies. Included in this report is the Managers Bond Fund (the Fund).
The Funds financial statements are prepared in accordance with accounting principles generally accepted in the United
States of America (U.S. GAAP), which require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates and such differences could be material. The following is a summary of significant accounting policies followed
by the Fund in the preparation of its financial statements:
a. |
Valuation of Investments |
Equity securities traded on a domestic or international securities exchange are valued at the last quoted sale price, or, lacking any sales, at the last quoted bid price. Over-the-counter securities are
valued at the Nasdaq Official Closing Price, if one is available. Lacking any sales, over-the-counter securities are valued at the last quoted bid price. The Funds investments are generally valued based on market quotations provided by
third-party pricing services approved by the Board of Trustees of the Fund (the Board).
Fixed-income securities
are valued based on valuations furnished by independent pricing services that utilize matrix systems, which reflect such factors as security prices, yields, maturities, and ratings, and are supplemented by dealer and exchange quotations. Short-term
investments having a remaining maturity of 60 days or less are generally valued at amortized cost, which approximates market value. Investments in other open-end regulated investment companies are valued at their end of day net asset value per
share.
Under certain circumstances, the value of certain Fund investments (including derivatives) may be based on an
evaluation of fair value, pursuant to procedures established by and under the general supervision of the Board. The Pricing Committee is the committee formed by the Board to make fair value determinations for such investments. When determining the
fair value of an investment, the Pricing Committee seeks to determine the price that the Fund might reasonably expect to receive from a current sale of that investment in an arms-length transaction. Fair value determinations shall be
based upon consideration of all available facts and information, including, but not limited to (i) attributes specific to the investment; (ii) fundamental analytical data and press
releases relating to the investment and its issuer; (iii) the value of comparable securities or relevant financial instruments, including derivative securities, traded on other markets or among dealers; and (iv) other factors, such as
future cash flows, interest rates, yield curves, volatilities, credit risks and/or default rates. The Board will be presented with a quarterly report comparing fair values determined by the Pricing Committee against subsequent market valuations for
those securities. The values assigned to fair value investments are based on available information and do not necessarily represent amounts that might ultimately be realized, since such amounts depend on future developments inherent in long-term
investments. Further, because of the inherent uncertainty of valuation, those estimated values may differ significantly from the values that would have been used had a ready market for the investments existed, and the differences could be material.
The Fund may use the fair value of a portfolio investment to calculate its net asset value (NAV) when, for example, (1) market quotations are not readily available because a portfolio investment is not traded in a public market or
the principal market in which the investment trades is closed, (2) trading in a portfolio investment is suspended and has not resumed before the Fund calculates its NAV, (3) a significant event affecting the value of a portfolio investment
is determined to have occurred between the time of the market quotation provided for a portfolio investment and the time as of which the Fund calculates its NAV, (4) an investments price has remained unchanged over a period of time (often
referred to as a stale price), or (5) Managers Investment Group LLC (the Investment Manager) determines that a market quotation is inaccurate. Portfolio investments that trade primarily on foreign markets are priced
based upon the market quotation of such securities as of the close of their respective principal markets, as adjusted to reflect the Investment Managers determination of the impact of events occurring subsequent to the close of such markets
but prior to the time as of which the Fund calculates its NAV. Under certain circumstances, the Investment Manager may adjust such prices based on its determination of the impact of events occurring subsequent to the close of such markets but prior
to the time as of which the Fund calculates its NAV. The Funds may invest in securities that may be thinly traded. The Board has adopted procedures to adjust prices of thinly traded securities that are judged to be stale so that they reflect fair
value. An investment valued on the basis of its fair value may be valued at a price higher or lower than available market quotations. An investments valuation may differ depending on the method used and the factors considered in determining
value according to the Funds fair value procedures.
Notes to Financial Statements (continued)
U.S. GAAP defines fair value as the price that a Fund 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 also 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. 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 Fund. Unobservable inputs reflect the Funds own assumptions about the assumptions that market
participants would use in pricing the asset or liability developed 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 inputs are quoted prices in active markets for identical investments (e.g., equity securities, open-end investment
companies)
Level 2 other observable inputs (including, but not limited to: quoted prices for similar assets or
liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield
curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market corroborated inputs) (e.g., debt securities, government securities, foreign currency exchange contracts, foreign securities utilizing
international fair value pricing, broker-quoted securities, fair valued securities with observable inputs)
Level 3
inputs are significant unobservable inputs (including the Funds own assumptions used to determine the fair value of investments) (e.g., fair valued securities with unobservable inputs)
Changes in inputs or methodologies used for valuing investments may result in a transfer in or out of levels within the fair value
hierarchy. Transfers between different levels in the fair value hierarchy are deemed to have occurred as of the beginning of the reporting period. The inputs or methodologies used for valuing investments are not necessarily an indication of the risk
associated with investing in those investments.
Security transactions are accounted for as of trade date. Realized gains and losses on securities sold are determined on the basis of identified cost.
c. |
Investment Income and Expenses |
Dividend income is recorded on the ex-dividend date. Dividend income on foreign securities is recorded net of any withholding tax. Interest income, which includes amortization of premium and accretion of
discount on debt securities, is accrued as earned. Non- cash dividends included in dividend income, if any, are reported at the fair market value of the securities received. Other income and expenses are recorded on an accrual basis. Expenses that
cannot be
directly attributed to a Fund are apportioned among the Funds in the Trust and in some
cases other affiliated funds based upon their relative average net assets or number of shareholders.
The Fund has a
balance credit agreement with The Bank of New York Mellon (BNYM), the Funds custodian, whereby the Fund is credited with an interest factor equal to 0.75% below the effective 90-day T-Bill rate for account balances left
uninvested overnight. If the T-Bill rate falls below 0.75%, no credits will be earned. These credits serve to reduce custody expenses that would otherwise be charged to the Fund. For the six months ended June 30, 2012, the custodian expense was
not reduced.
Overdrafts will cause a reduction of any earnings credits, computed at 2% above the Federal funds rate on the
day of the overdraft. For the six months ended June 30, 2012, the Fund had no overdraft fees.
The Fund also has a
balance credit arrangement with its Transfer Agent, BNY Mellon Investment Servicing (US) Inc., whereby earnings credits are used to offset banking charges and other out-of-pocket expenses. For the six months ended June 30, 2012, the transfer
agent expense was reduced by $288.
The Investment Manager has agreed to waive a portion of its management fee in
consideration of shareholder servicing fees that it has received from JPMorgan Distribution Services, Inc., with respect to short-term cash investments the Fund has made in JPMorgan Liquid Assets Money Market Fund, Capital Shares. For the six months
ended June 30, 2012, the management fee was reduced by $23,617.
Total returns and net investment income for the Fund
would have been lower had certain expenses not been offset. Total expenses before offsets exclude the impact of expense reimbursements or fee waivers and expense offsets such as brokerage recapture credits, but include non-reimbursable expenses, if
any, such as interest and taxes.
d. |
Dividends and Distributions |
Dividends resulting from net investment income, if any, normally will be declared daily and paid monthly. Distributions of capital gains, if any, will be made on an annual basis and when required for
Federal excise tax purposes. Income and capital gain distributions are determined in accordance with Federal income tax regulations, which may differ from U.S. GAAP. These differences are primarily due to differing treatments for losses deferred due
to wash sales, equalization accounting for tax purposes, foreign currency, options, futures and market discount transactions. Permanent book and tax basis differences, if any, relating to shareholder distributions will result in reclassifications to
paid-in capital.
Notes to Financial Statements (continued)
The Fund intends to comply with the requirements under Subchapter M of the Internal Revenue Code of 1986, as amended, and to distribute
substantially all of its taxable income and gains to its shareholders and to meet certain diversification and income requirements with respect to investment companies. Therefore, no provision for Federal income or excise tax is included in the
accompanying financial statements.
Additionally, based on the Funds understanding of the tax rules and rates related
to income, gains and transactions for the foreign jurisdictions in which it invests, the Fund will provide for foreign taxes, and where appropriate, deferred foreign taxes.
Management has analyzed the Funds tax positions taken on federal income tax returns for all open tax years (tax years ended December 31, 2008-2011), and has concluded that no provision for
federal income tax is required in the Funds financial statements. Additionally, the Fund is not aware of any tax position for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the
next twelve months.
Under the Regulated Investment Company Modernization Act of 2010 (the Act), post-enactment
capital losses may be carried forward for an unlimited time period. However, any new losses incurred will be required to be utilized prior to any loss carryovers incurred in pre-enactment taxable years, which generally expire eight years following
the close of the taxable year in which they were incurred. As a result of this ordering rule, pre-enactment capital loss carryovers may be more likely to expire unused. Additionally, post-enactment capital losses that are carried forward retain
their tax character as either short-term or long-term capital losses rather than being considered all short-term as under previous law.
f. |
Capital Loss Carryovers and Deferrals |
As of June 30, 2012, the Fund had accumulated net realized capital loss carryovers from securities transactions for Federal income tax purposes as shown in the following chart. The amounts may be
used to offset future realized capital gains, if any, through the expiration dates listed or in the case of post-enactment losses, for an unlimited time period.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital Loss Carryover Amounts |
|
|
Expires December
31, |
|
|
|
Short-Term |
|
|
Long-Term |
|
|
(Pre-Enactment) |
|
$ |
46,433,792 |
|
|
|
|
|
|
|
2017 |
|
(Pre-Enactment) |
|
|
15,307,296 |
|
|
|
|
|
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Totals |
|
$ |
61,741,088 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Trusts Declaration of Trust authorizes for each series the issuance of an unlimited number of shares of beneficial interest,
without par value. The Fund records sales and repurchases of its capital stock on the trade date. The cost of securities contributed to the Fund in connection with the issuance of shares is based on the valuation of those securities in accordance
with the Funds policy on investment valuation. Dividends and distributions to shareholders are recorded on the ex-dividend date.
At June 30, 2012, certain unaffiliated shareholders of record, specifically omnibus
accounts, individually or collectively held greater than 10% of the outstanding shares of the Fund as follows: three collectively own 64%. Transactions by these shareholders may have a material impact on the Fund.
h. |
Foreign Currency Translation |
The books and records of the Fund are maintained in U.S. dollars. The value of investments, assets and liabilities denominated in currencies other than U.S. dollars are translated into U.S. dollars based
upon current foreign exchange rates. Purchases and sales of foreign investments, income and expenses are converted into U.S. dollars based on currency exchange rates prevailing on the respective dates of such transactions. Net realized and
unrealized gain (loss) on foreign currency transactions represent: (1) foreign exchange gains and losses from the sale and holdings of foreign currencies; (2) gains and losses between trade date and settlement date on investment securities
transactions and forward foreign currency exchange contracts; and (3) gains and losses from the difference between amounts of interest and dividends recorded and the amounts actually received.
The Fund does not isolate the net realized and unrealized gain or loss resulting from changes in exchange rates from the fluctuations in
market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments.
The Fund invests in securities of foreign entities and in instruments denominated in foreign currencies which involve risks not typically associated with investments in domestic securities. Non-domestic
securities carry special risks, such as exposure to currency fluctuations, less developed or less efficient trading markets, political instability, a lack of company information, differing auditing and legal standards, and, potentially, less
liquidity.
Realized gains in certain countries may be subject to foreign taxes at the Fund level, at rates ranging from
approximately 10% to 15%. The Fund would pay such foreign taxes on net realized gains at the appropriate rate for each jurisdiction.
2. |
Agreements and Transactions with Affiliates |
The Trust has entered into an Investment Management Agreement under which the Investment Manager, a subsidiary of Affiliated Managers Group, Inc. (AMG), serves as investment manager to the
Fund and is responsible for the Funds overall administration. The Investment Manager selects subadvisors for the Fund (subject to Board approval) and monitors the subadvisors investment programs and results. The Funds investment
portfolio is managed by a portfolio manager who serves pursuant to a subadvisory agreement with the Investment Manager.
Investment management fees are paid directly by the Fund to the Investment Manager based on average net assets. The annual investment
management fee rate, as a percentage of average daily net assets, for the six months ended June 30, 2012, was 0.625%.
The Investment Manager has contractually agreed, through at least May 1, 2013, to waive management fees and/or reimburse Fund
expenses in order to limit total annual Fund operating expenses
Notes to Financial Statements (continued)
after fee waiver and expense reimbursements (exclusive of taxes, interest (including interest incurred in connection with bank and custody overdrafts), brokerage commissions and other transaction
costs, acquired fund fees and expenses, and extraordinary expenses) to 0.99% of the Funds average daily net assets subject to later reimbursement by the Fund in certain circumstances.
The Fund is obligated to repay the Investment Manager such amounts waived, paid or reimbursed in future years provided that the
repayment occurs within thirty-six (36) months after the waiver or reimbursement and that such repayment would not cause the Funds total operating expenses in any such future year to exceed the Funds expense cap. For the six months
ended June 30, 2012, the Funds components of reimbursement available are detailed in the following chart:
|
|
|
|
|
Reimbursement Available - 12/31/11 |
|
$ |
5,150,846 |
|
Additional Reimbursements |
|
|
661,569 |
|
Repayments |
|
|
|
|
Expired Reimbursements |
|
|
(1,166,684 |
) |
|
|
|
|
|
Reimbursement Available - 6/30/12 |
|
$ |
4,645,731 |
|
|
|
|
|
|
The Fund has entered into an Administration and Shareholder Servicing Agreement under which the
Investment Manager serves as the Funds administrator (the Administrator) and is responsible for all aspects of managing the Funds operations, including administration and shareholder services to the Fund, its shareholders,
and certain institutions, such as bank trust departments, broker-dealers and registered investment advisers, that advise or act as an intermediary with the Funds shareholders. The Fund pays a fee to the Administrator at the rate of
0.25% per annum of the Funds average daily net assets for this service.
The aggregate annual retainer paid to
each Independent Trustee of the Board is $80,000, plus $5,000 or $2,500 for each regular or special meeting attended, respectively. The Independent Chairman of the Trust receives an additional payment of $20,000 per year. The Chairman of the Audit
Committee receives an additional payment of $8,000 per year. The Trustees fees and expenses are allocated among all of the funds for which the Investment Manager serves as the advisor (the Managers Funds) based on the relative net
assets of such funds. The Trustees fees and expenses shown in the financial statements represents the Funds allocated portion of the total fees and expenses paid by the Managers Funds.
The Fund is distributed by Managers Distributors, Inc. (the Distributor or MDI), a wholly-owned subsidiary of
the Investment Manager. MDI serves as the distributor and underwriter for the Fund and is a registered broker-dealer and member of the Financial Industry Regulatory Authority, Inc. (FINRA). Shares of the Fund will be continuously offered
and will be sold directly to prospective purchasers through brokers, dealers or other financial intermediaries who have executed selling agreements with MDI. Subject to the compensation arrangement discussed below, generally MDI bears all or a
portion of the expenses of providing services pursuant to the distribution agreement, including the payment of the expenses relating to the distribution of prospectuses for sales purposes and any advertising or sales literature. Certain Trustees
and Officers of the Fund are Officers and/or Directors of the Investment Manager, AMG
and/or the Distributor.
The Securities and Exchange Commission granted an exemptive order that permits the Fund to lend and
borrow money for certain temporary purposes directly to and from other eligible Managers Funds. Participation in this interfund lending program is voluntary for both borrowing and lending funds, and an interfund loan is only made if it benefits each
participating fund. The Investment Manager administers the program according to procedures approved by the Board, and the Board monitors the operation of the program. An interfund loan must comply with certain conditions set out in the exemptive
order, which are designed to assure fairness and protect all participating funds. For the six months ended June 30, 2012, the Fund lent to other Managers Funds varying amounts up to $18,086,305 for 5 days earning interest of $615. The interest
earned is included in the Statement of Operations as interest income. For the same period, the Fund did not borrow from any other Managers Funds.
3. |
Purchases and Sales of Securities |
Purchases and sales of securities (excluding short-term securities and U.S. Government obligations) for the six months ended June 30, 2012, were $203,399,674 and $212,750,737, respectively. Purchases
and sales of U.S. Government obligations for the six months ended June 30, 2012, were $441,445,403 and $75,591,262, respectively.
4. |
Portfolio Securities Loaned |
The Fund participates in a securities lending program offered by BNYM (the Program), providing for the lending of securities to qualified brokers. Securities lending income include earnings of
such temporary cash investments, plus or minus any rebate to a borrower. These earnings (after any rebate) are then divided between BNYM, as a fee for its services under the program, and the Fund, according to agreed-upon rates. Collateral on all
securities loaned is accepted in cash and/or government securities and is maintained at a minimum level of 102% (105% in the case of certain foreign securities) of the market value, plus interest, if applicable, of investments on loan. It is the
Funds policy to obtain additional collateral from or return excess collateral to the borrower by the end of the next business day, following the valuation date of the securities loaned. Therefore, the value of the collateral held may be
temporarily less than the value of the securities on loan. Lending securities entails a risk of loss to the Fund if and to the extent that the market value of the securities loaned were to increase and the borrower did not increase the collateral
accordingly, and the borrower fails to return the securities. Under the terms of the Program, the Fund is indemnified for such losses by BNYM. The Fund bears the risk of any deficiency in the amount of the collateral available for return to the
borrower due to any loss on the collateral invested. Collateral received in the form of cash is invested temporarily in the BNY Mellon Overnight Government Fund, formerly the BNY Institutional Cash Reserves Fund (the ICRF), or other
short-term investments as defined in the Securities Lending Agreement with BNYM.
Effective August 2, 2010, the Trust,
on behalf of the Fund, entered into an agreement with BNYM and the Bank of New York Mellon Corporation (BNYMC) with respect to the Funds position
Notes to Financial Statements (continued)
in ICRF, pursuant to which (i) BNYMC would support the value of certain defaulted securities issued by Lehman Brothers Holdings, Inc. (the Lehman Securities) and held by Series B
of the ICRF, and (ii) once certain conditions were met, BNYMC would purchase the defaulted securities from the Fund. On October 17, 2011, after certifying that the Fund had met all necessary conditions, BNYMC purchased the Lehman
Securities from the Fund at a predetermined price, which represented a premium over the fair market value of the Lehman Securities at that date.
5. |
Commitments and Contingencies |
In the normal course of business, the Fund may enter into contracts and agreements that contain a variety of representations and warranties, which provide general indemnifications. The maximum exposure to
the Fund under these arrangements is unknown, as this would involve future claims that may be made against the Fund that have not yet occurred. However, the Fund has had no prior claims or losses and expects the risk of material loss to be remote.
6. |
Risks Associated with High Yield Securities |
Investing in high yield securities involves greater risks and considerations not typically associated with U.S. Government and other high quality/investment grade securities. High Yield securities are
generally below investment grade securities and do not have an established retail secondary market. Economic downturns may disrupt the high yield market and impair the issuers ability to repay principal and interest. Also, an increase in
interest rates would likely have an adverse impact on the value of such obligations and could cause the securities to become less liquid.
Certain transactions, such as futures and forward transactions, dollar roll agreements, or purchases of when-issued or delayed delivery securities may have a similar effect on the Funds net asset
value as if the Fund had created a degree of leverage in its portfolio. However, if the Fund enters into such a transaction, the Fund will establish a segregated account with its custodian in which it will maintain cash, U.S. government securities
or other liquid securities equal in value to its obligations in respect to such transaction. Securities and other assets held in the segregated account may not be sold while the transaction is outstanding, unless other suitable assets are
substituted.
8. |
Derivative Instruments |
The following disclosures contain information on how and why the Fund uses derivative instruments, the credit risk and how derivative instruments affect the Funds financial position, results of
operations and cash flows. The location and fair value amounts of these instruments would be on the Statement of Assets and Liabilities and the realized and changes in unrealized gains and losses on the Statement of Operations, each categorized by
type of derivative
contract, are included in a table in the Schedule of Portfolio Investments. The
derivative instruments outstanding as of June 30, 2012, as disclosed in the Statement of Assets and Liabilities and the realized and unrealized changes in gains and losses on derivative instruments during the six months ended June 30,
2012, as disclosed in the Statement of Operations serve as indicators of the volume of derivative activity for the Fund.
9. |
Forward Foreign Currency Contracts |
During the six months ended June 30, 2012, the Fund invested in forward foreign currency contracts to facilitate transactions in foreign securities and to hedge against foreign currency exchange rate
risk on its non-U.S. dollar denominated investment securities.
A forward foreign currency contract is an agreement between a
fund and another party to buy or sell a currency at a set price at a future date. The market value of the contract will fluctuate with changes in currency exchange rates. The contract is marked-to-market daily, and the change in market value is
recorded as an unrealized gain or loss. Gain or loss on the purchase or sale of contracts having the same settlement date, amount and counterparty is realized on the date of offset, otherwise gain or loss is realized on the settlement date.
Risks may arise upon entering into these contracts from the potential inability of counterparties to meet the terms of their
contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar.
10. |
New Accounting Pronouncements |
In December 2011, the FASB issued ASU No. 2011-11,
Disclosures about
Offsetting Assets and Liabilities. ASU 2011- 11 requires disclosures to make financial statements that are prepared under U.S. GAAP more comparable to those prepared under IFRS. The new disclosure requirements mandate that entities disclose
both gross and net information about instruments and transactions eligible for offset in the statement of assets and liabilities as well as instruments and transactions subject to an agreement similar to a master netting arrangement. In addition,
ASU 2011-11 requires disclosure of collateral received and posted in connection with master netting agreements or similar arrangements. New disclosures are required for annual reporting periods beginning on or after January 1, 2013, and interim
periods within those annual periods. Management is evaluating the impact of ASU 2011-11 on the Funds financial statements and disclosures.
The Fund has determined that no material events or transactions occurred through the issuance date of the Funds financial
statements, which require additional disclosure in or adjustment of the Funds financial statements.
Annual Renewal of Investment Advisory Agreement (unaudited)
On June 21-22, 2012, the Board of Trustees, including a majority of the Trustees who
are not interested persons of the Trust (the Independent Trustees), approved the Investment Management Agreement with the Investment Manager for the Managers Bond Fund (the Fund) and the Subadvisory Agreement for
the Subadvisor of the Fund. The Independent Trustees were separately represented by independent counsel in connection with their consideration of the approval of these agreements. In considering the Investment Management and Subadvisory Agreements,
the Trustees reviewed a variety of materials relating to the Fund, the Investment Manager and the Subadvisor, including comparative performance, fee and expense information for an appropriate peer group of similar mutual funds (the Peer
Group), performance information for the relevant benchmark index (the Fund Benchmark) and, with respect to the Subadvisor, comparative performance information for an appropriate peer group of managed accounts, and, as to all other
matters, other information provided to them on a periodic basis throughout the year, as well as information provided in connection with the meetings of June 21-22, 2012, regarding the nature, extent and quality of services provided by the
Investment Manager and the Subadvisor under their respective agreements. Prior to voting, the Independent Trustees: (a) reviewed the foregoing information with their independent legal counsel and with management; (b) received materials
from their independent legal counsel discussing the legal standards applicable to their consideration of the Investment Management Agreement and the Subadvisory Agreement; and (c) met with their independent legal counsel in private sessions at
which no representatives of management were present.
Nature, extent and quality of services.
In considering the nature, extent and quality of the services provided by the Investment Manager, the Trustees reviewed information
relating to the Investment Managers operations and personnel. Among other things, the Investment Manager provided financial information, biographical information on its supervisory and professional staff and descriptions of its organizational
and management structure. The Trustees also took into account information provided periodically throughout the previous year by the Investment Manager relating to the performance of its duties with respect to the Fund and the Trustees
familiarity with the Investment Managers management through Board meetings, discussions and reports. In the course of their deliberations regarding the Investment Management Agreement, the Trustees evaluated, among other things: (a) the
extent and quality of the Investment Managers oversight of the operation and management of the Fund; (b) the quality of the search, selection and monitoring services performed by the Investment Manager in overseeing the portfolio
management responsibilities of the Subadvisor; (c) the Investment Managers ability to supervise the Funds other service providers; and (d) the Investment Managers compliance program. The Trustees also took into account
the financial condition of the Investment Manager with respect to its ability to provide the services required under the Investment Management Agreement
and to maintain a contractual expense limitation for the Fund. The Trustees also
considered the Investment Managers risk management processes.
The Trustees also reviewed information relating to the
Subadvisors operations and personnel and the investment philosophy, strategies and techniques (the Investment Strategy) used in managing the Fund. Among other things, the Trustees reviewed biographical information on portfolio
management and other professional staff, information regarding the Subadvisors organizational and management structure and the Subadvisors brokerage policies and practices. The Trustees considered specific information provided regarding
the experience of the individual or individuals at the Subadvisor with portfolio management responsibility for the Fund, including the information set forth in the Funds prospectus and statement of additional information. In the course of
their deliberations, the Trustees evaluated, among other things: (a) the services rendered by the Subadvisor in the past; (b) the qualifications and experience of the Subadvisors personnel; and (c) the Subadvisors
compliance program. The Trustees also took into account the financial condition of the Subadvisor with respect to its ability to provide the services required under the Subadvisory Agreement. The Trustees also considered the Subadvisors risk
management processes.
Performance.
Among other information relating to the Funds performance, the Trustees noted that the Funds performance for the 1-year, 3-year, 5-year and 10-year periods ended March 31, 2012 was above
the median performance of the Peer Group and below, above, above and above, respectively, the performance of the Fund Benchmark, the Barclays U.S. Government/Credit Bond Index. The Board took into account managements discussion of the
Funds performance, including the reasons for the Funds recent underperformance relative to its benchmark. The Trustees also noted that the Funds intermediate and long-term performance has been strong relative to the Fund Benchmark
and the Peer Group. The Trustees concluded that the Funds overall performance has been satisfactory.
As noted above,
the Board considered the Funds net performance during relevant time periods as compared to the Funds Peer Group and Fund Benchmark and considered the Subadvisors performance as compared to an appropriate peer group of managed
accounts and also considered the gross performance of the Fund as compared to the Subadvisors relevant performance composite that utilizes the same investment strategy and approach and noted that the Board reviews on a quarterly basis detailed
information about the Funds performance results, portfolio composition and Investment Strategies. The Board noted the Investment Managers expertise and resources in monitoring the performance, investment style and risk-adjusted
performance of the Subadvisor. The Board was mindful of the Investment Managers attention to monitoring the Subadvisors performance with respect to the Fund and its discussions with management regarding the factors that contributed to
the performance of the Fund.
Annual Renewal of Investment Advisory Agreement (continued)
Advisory and Subadvisory Fees and Profitability.
In considering the reasonableness of the advisory fee charged by the Investment Manager for managing the Fund, the Trustees noted that
the Investment Manager, and not the Fund, is responsible for paying the fees charged by the Funds Subadvisor and, therefore, that the fees paid to the Investment Manager cover the cost of providing portfolio management services as well as the
cost of providing search, selection and monitoring services in operating a manager-of-managers complex of mutual funds. The Trustees concluded that, in light of the additional high quality supervisory services provided by the Investment
Manager and the fact that the subadvisory fees are paid out of the advisory fee, the advisory fee payable by the Fund to the Investment Manager can reasonably be expected to exceed the median advisory fee for the Peer Group, which consists of many
funds that do not operate with a manager-of-managers structure. In this regard, the Trustees also noted that the Investment Manager has undertaken to maintain an expense limitation for the Fund.
In considering the reasonableness of the advisory fee payable to the Investment Manager, the Trustees also reviewed information provided
by the Investment Manager setting forth all revenues and other benefits, both direct and indirect (including any so-called fallout benefits such as reputational value derived from the Investment Manager serving as Investment Manager to
the Fund), received by the Investment Manager and its affiliates attributable to managing the Fund and all the mutual funds in the Managers Family of Funds, the cost of providing such services and the resulting profitability to the Investment
Manager and its affiliates from these relationships. The Trustees also noted the current and potential asset levels of the Fund and the willingness of the Investment Manager to waive fees and pay expenses for the Fund from time to time as a means of
limiting the total expenses of the Fund. The Trustees also considered managements discussion of the current asset level of the Fund, including the effect on assets attributable to the economic and market conditions since 2008, and considered
the impact on profitability of the current asset level and any future growth of assets of the Fund. The Board took into account managements discussion of the current advisory fee structure. Based on the foregoing, the Trustees concluded that
the profitability to the Investment Manager is reasonable and that the Investment Manager is not realizing material benefits from economies of scale that would warrant adjustments to the advisory fees for the Fund at this time. With respect to
economies of scale, the Trustees also noted that as the Funds assets increase over time, the Fund may realize other economies of scale to the extent that the increase in assets is proportionally greater than the increase in certain other
expenses.
In considering the reasonableness of the fee payable by the Investment Manager to the Subadvisor, the Trustees
relied on the ability of the Investment Manager to negotiate the terms of the Subadvisory Agreement at arms length as part of the manager-of-managers structure, noting that the Subadvisor is not affiliated with the Investment Manager. In
addition, the Trustees considered
other potential benefits of the subadvisory relationship to the Subadvisor, including, among others, the indirect benefits that the Subadvisor may receive from the Subadvisors relationship
with the Fund, including any so-called fallout benefits to the Subadvisor, such as reputational value derived from the Subadvisor serving as Subadvisor to the Fund. In addition, the Trustees noted that the subadvisory fees are paid by
the Investment Manager out of its advisory fee. As a consequence, the cost of services to be provided by the Subadvisor and the profitability to the Subadvisor of its relationship with the Fund were not material factors in the Trustees
deliberations. For similar reasons, the Trustees did not consider potential economies of scale in the management of the Fund by the Subadvisor to be a material factor in their deliberations at this time.
The Trustees noted that the Funds advisory fees (which include both the advisory and administration fee) and total expenses (net
of applicable expense waivers/reimbursements) as of March 31, 2012 were both higher than the average for the Peer Group. The Trustees took into account the fact that the Investment Manager has contractually agreed, through May 1, 2013, to
limit the Funds net annual operating expenses (subject to certain excluded expenses) to 0.99%. The Trustees took into account managements discussion of the Funds expenses. The Trustees concluded that, in light of the nature, extent
and quality of the services provided by the Investment Manager and the Subadvisor, the foregoing expense limitation and the considerations noted above with respect to the Subadvisor and the Investment Manager, the Funds advisory fees,
including subadvisory fees, are reasonable.
* * * *
After consideration of the foregoing, the Trustees also reached the following conclusions (in addition to the conclusions
discussed above) regarding the Investment Management Agreement and the Subadvisory Agreement: (a) the Investment Manager and the Subadvisor have demonstrated that they possess the capability and resources to perform the duties required of them
under the Investment Management Agreement and the Subadvisory Agreement; (b) the Subadvisors Investment Strategy is appropriate for pursuing the Funds investment objectives; and (c) the Investment Manager and the Subadvisor
maintain appropriate compliance programs.
Based on all of the above-mentioned factors and related conclusions, with no
single factor or conclusion being determinative and with each Trustee not necessarily attributing the same weight to each factor, the Trustees concluded that approval of the Investment Management Agreement and the Subadvisory Agreement would be in
the best interests of the Fund and its shareholders. Accordingly, on June 21-22, 2012, the Trustees, including a majority of the Independent Trustees, voted to approve the Investment Management Agreement and the Subadvisory Agreement for the
Fund.
THIS PAGE INTENTIONALLY LEFT BLANK
THIS PAGE INTENTIONALLY LEFT BLANK
Investment Manager and Administrator
Managers Investment Group LLC
800 Connecticut
Avenue
Norwalk, CT 06854
(800)
835-3879
Distributor
Managers Distributors, Inc.
800 Connecticut
Avenue
Norwalk, CT 06854
(800)
835-3879
Custodian
The Bank
of New York Mellon
2 Hanson Place
Brooklyn, NY 11217
Legal Counsel
Ropes & Gray LLP
Prudential Tower, 800 Boylston Street
Boston,
MA 02199-3600
Transfer Agent
BNY Mellon Investment Servicing (US) Inc.
Attn:
Managers
P.O. Box 9769
Providence,
RI 02940
(800) 548-4539
For ManagersChoice Only
Managers
c/o BNY Mellon Investment Servicing
(US) Inc.
P.O. Box 9847
Providence,
RI 02940-8047
(800) 358-7668
Trustees
Jack W. Aber
Bruce B. Bingham
Christine C. Carsman
William E. Chapman, II
Edward J.
Kaier
Steven J. Paggioli
Eric
Rakowski
Thomas R. Schneeweis
MANAGERS AND MANAGERS AMG
FUNDS
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EQUITY
FUNDS |
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BALANCED
FUNDS |
CADENCE CAPITAL
APPRECIATION CADENCE FOCUSED GROWTH
CADENCE MID-CAP CADENCE EMERGING COMPANIES Cadence Capital
Management, LLC CHICAGO EQUITY
PARTNERS MID-CAP Chicago Equity Partners, LLC
ESSEX SMALL/MICRO CAP
GROWTH Essex Investment Management Co., LLC
FQ TAX-MANAGED U.S. EQUITY FQ U.S. EQUITY First Quadrant, L.P.
FRONTIER SMALL CAP
GROWTH Frontier Capital Management Company, LLC
GW&K SMALL CAP
EQUITY Gannett Welsh & Kotler, LLC
MICRO-CAP
Lord, Abbett & Co. LLC WEDGE Capital
Management L.L.P. Next Century Growth Investors LLC RBC Global Asset Management (U.S.) Inc. |
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REAL ESTATE
SECURITIES Urdang Securities Management, Inc.
RENAISSANCE LARGE CAP
GROWTH Renaissance Group LLC
SKYLINE SPECIAL EQUITIES PORTFOLIO Skyline Asset Management, L.P.
SPECIAL EQUITY
Ranger Investment Management, L.P. Lord, Abbett
& Co. LLC Smith Asset Management Group, L.P. Federated MDTA LLC
SYSTEMATIC VALUE SYSTEMATIC MID CAP VALUE
Systematic Financial Management, L.P.
TIMESSQUARE MID CAP GROWTH
TIMESSQUARE SMALL CAP GROWTH
TSCM GROWTH EQUITY TimesSquare Capital Management, LLC TRILOGY GLOBAL EQUITY
TRILOGY EMERGING MARKETS EQUITY
TRILOGY INTERNATIONAL SMALL CAP
Trilogy Global Advisors, L.P.
YACKTMAN FUND
YACKTMAN FOCUSED FUND Yacktman Asset Management L.P. |
|
CHICAGO EQUITY PARTNERS BALANCED
Chicago Equity Partners, LLC
ALTERNATIVE FUNDS
FQ GLOBAL ALTERNATIVES
FQ GLOBAL ESSENTIALS First Quadrant, L.P. INCOME FUNDS BOND (MANAGERS) FIXED INCOME
GLOBAL INCOME OPPORTUNITY Loomis, Sayles & Co., L.P. BOND (MANAGERS PIMCO)
Pacific Investment Management Co. LLC
CALIFORNIA INTERMEDIATE TAX-FREE
Miller Tabak Asset Management LLC
GW&K MUNICIPAL BOND GW&K MUNICIPAL ENHANCED YIELD
Gannett Welsh & Kotler, LLC
HIGH YIELD
J.P. Morgan Investment Management LLC
INTERMEDIATE DURATION GOVERNMENT SHORT DURATION GOVERNMENT Smith Breeden
Associates, Inc. |
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This report is prepared for the Funds shareholders. It is authorized for distribution to
prospective investors only when preceded or accompanied by an effective prospectus. To receive a free copy of the prospectus or Statement of Additional Information, which includes additional information about Fund Trustees, please contact us by
calling 800.835.3879. Distributed by Managers Distributors, Inc., member FINRA. A description of the policies and procedures each Fund uses to vote its proxies is available: (i) without charge, upon request, by calling 800.835.3879, or (ii) on the Securities and Exchange
Commissions (SEC) Web site at www. sec.gov. For information regarding each Funds proxy voting record for the 12-month period ended June 30, call 800.835.3879 or visit the SEC Web site at www.sec.gov.
The Fund files its complete schedule of portfolio holdings with
the SEC for the first and third quarters of each fiscal year on Form N-Q. The Funds Forms N-Q are available on the SECs Web site at www.sec.gov. A Funds Forms N-Q may be reviewed and copied at the SECs Public Reference Room
in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 800.SEC.0330. To review a complete list of the Funds portfolio holdings, or to view the most recent quarterly holdings report, semiannual
report, or annual report, please visit www.managersinvest.com. |
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www.managersinvest.com
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SEMI-ANNUAL REPORT
Managers Funds
June 30, 2012
Managers Global Income Opportunity Fund
(formerly Managers Global Bond Fund)
Managers Global Income Opportunity Fund
Semi-Annual Report June 30, 2012
(unaudited)
TABLE OF CONTENTS
Nothing contained herein is to be considered an offer, sale or solicitation of an offer to buy shares of any series of
the Managers Family of Funds. Such offering is made only by Prospectus, which includes details as to offering price and other material information.
About Your Funds Expenses (unaudited)
As a shareholder of a Fund, you may incur two types of costs: (1) transaction costs,
which may include sales charges (loads) on purchase payments; redemption fees; and exchange fees; 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 $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 following table provides information about the 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 $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled Expenses
Paid During Period to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison
Purposes
The second line of the following table provides information about hypothetical account values and
hypothetical expenses based on the Funds actual expense ratio and an assumed annual rate of return of 5% before expenses, which is not the Funds actual return. The hypothetical account values and expenses may not be used to estimate the
actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds by comparing this 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of other funds.
Please note that the expenses shown in the table are meant to highlight
your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine
the relative total costs of owning different funds.
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Six Months Ended June 30, 2012 |
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Expense Ratio for the Period |
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Beginning Account Value 01/01/12 |
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Ending Account Value 06/30/12 |
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Expenses Paid During the Period* |
|
Managers Global Income Opportunity Fund |
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Based on Actual Fund Return |
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1.10 |
% |
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$ |
1,000 |
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$ |
1,040 |
|
|
$ |
5.58 |
|
Hypothetical (5% return before expenses) |
|
|
1.10 |
% |
|
$ |
1,000 |
|
|
$ |
1,019 |
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$ |
5.52 |
|
* |
Expenses are equal to the Funds annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the most
recent half-year (182), then divided by 366. |
Fund Performance
Periods ended June 30, 2012 (unaudited)
The table below shows the average annual total returns for the periods indicated for the Fund, as well as the Funds relative index
for the same time periods.
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Average Annual Total
Returns1 |
|
Six Months* |
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One Year |
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Five Years |
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Ten Years |
|
Managers Global Income Opportunity Fund2,3,4,5,6 |
|
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3.99 |
% |
|
|
2.43 |
% |
|
|
6.67 |
% |
|
|
7.48 |
% |
Barclays Global Aggregate Bond Index®7 |
|
|
1.50 |
% |
|
|
2.73 |
% |
|
|
6.70 |
% |
|
|
6.49 |
% |
The performance data shown represents past performance. Past performance is not a
guarantee of future results. Current performance may be lower or higher than the performance data quoted. The investment return and principal value of an investment in the Fund will fluctuate so that an investors shares, when redeemed, may be
worth more or less than their original cost. For performance information through the most recent month end, please call (800) 835-3879 or visit our Web site at www.managersinvest.com.
Investors should carefully consider the amount they plan to invest, their investment objectives, the Funds investment objectives,
risks, charges, and expenses before investing. For this and other information, please call (800) 835-3879 or visit our Web site at www.managersinvest.com for a free prospectus. Read it carefully before investing or sending money. Distributed by
Managers Distributors, Inc., member of FINRA.
1 |
Total return equals income yield plus share price change and assumes reinvestment of all dividends and capital gain distributions. Returns are net of
fees and may reflect offsets of Fund expenses as described in the Prospectus. No adjustment has been made for taxes payable by shareholders on their reinvested dividends and capital gain distributions. Returns for periods greater than one year are
annualized. The listed returns on the Fund are net of expenses and based on the published NAV as of June 30, 2012. All returns are in U.S. dollars($). |
2 |
The Fund is subject to the risks associated with investments in debt securities, such as default risk and fluctuations in the perception of the
debtors ability to pay its creditors.
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3 |
From time to time, the Funds advisor has waived its fees and/or absorbed Fund expenses, which has resulted in higher returns.
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4 |
Changing interest rates may adversely affect the value of a fixed income investment. An increase in interest rates typically causes the value of bonds
and other fixed income securities to fall. The Fund is subject to the risks associated with investments in debt securities, such as default risk and fluctuations in the perception of the debtors ability to pay its creditors.
|
5 |
Investments in foreign securities are subject to additional risks such as changing market conditions, economic and political instability, and currency
exchange rate fluctuations. The Fund is subject to currency risk resulting from fluctuations in exchange rates that may affect the total loss or gain on a non- U.S. dollar security when converted back to U.S. dollars. |
6 |
The Fund may invest in below investment grade debt securities and unrated securities of similar credit quality (commonly known as junk bond
or high yield securities) which may be subject to greater levels of interest rate, credit, and liquidity risk. |
7 |
The Barclays Global Aggregate Bond Index provides a broad-based measure of the global investment-grade fixed income markets. The three major components
of this index are the U.S. Aggregate, the Pan-European Aggregate, and the Asian-Pacific Aggregate Indices. The Index also includes Eurodollar and Euro-Yen corporate bonds, Canadian government, agency and corporate securities, and USD
investment-grade 144A securities. Unlike the Fund, the Barclays Global Aggregate Bond Index is unmanaged, is not available for investment, and does not incur fees. |
Not FDIC Insured, nor bank guaranteed. May lose value.
Managers Global Income Opportunity Fund
Fund Snapshots
June 30, 2012
Portfolio Breakdown (unaudited)
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Category |
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Managers Global Income Opportunity Fund** |
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Barclays Global Aggregate Bond Index |
|
Foreign Government and Agency Obligations |
|
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40.8 |
% |
|
|
51.7 |
% |
Corporate Bonds and Notes |
|
|
38.6 |
% |
|
|
15.7 |
% |
U.S. Government Obligations |
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11.6 |
% |
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16.1 |
% |
Asset-Backed Securities |
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2.9 |
% |
|
|
0.2 |
% |
Mortgage-Backed Securities |
|
|
1.5 |
% |
|
|
16.3 |
% |
Municipal Bonds |
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0.2 |
% |
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0.0 |
% |
Other Assets and Liabilities |
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4.4 |
% |
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|
0.0 |
% |
** |
As a percentage of net assets.
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Rating |
|
Managers Global Income Opportunity Fund |
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Barclays Global Aggregate Bond Index |
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U.S. Treasury & Agency |
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12.2 |
% |
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28.1 |
% |
Aaa |
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23.3 |
% |
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22.4 |
% |
Aa |
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8.1 |
% |
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25.4 |
% |
A |
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23.9 |
% |
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14.7 |
% |
Baa |
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22.8 |
% |
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9.4 |
% |
Ba & lower |
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9.1 |
% |
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0.0 |
% |
Not Rated |
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0.6 |
% |
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0.0 |
% |
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As a percentage of market value of fixed income securities. Chart does not include equity securities.
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Top Ten Holdings
(unaudited)
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Security Name |
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% of Net Assets |
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U.S. Treasury Notes, 0.250%, 02/15/15 |
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8.5 |
% |
Mexican Fixed Rate Notes, 7.750%, 12/14/17 |
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3.2 |
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Japan Government Notes, Series 84, 0.700%, 06/20/14* |
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2.9 |
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Canadian Government Notes, 3.000%, 12/01/15* |
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2.3 |
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Bundesrepublik Deutschland Bonds, Series 06, 3.750%, 01/04/17 |
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2.2 |
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Mexican Fixed Rate Bonds, 8.000%, 12/07/23* |
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2.0 |
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U.S. Treasury Notes, 2.250%, 03/31/16 |
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1.9 |
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International Bank for Reconstruction & Development Notes, GMTN, 2.300%, 02/26/13 |
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1.7 |
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Norway Government Bonds, Series 473, 4.500%, 05/22/19* |
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1.6 |
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Singapore Government Notes, 1.625%, 04/01/13* |
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1.4 |
|
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Top Ten as a Group |
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27.7 |
% |
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* |
Top Ten Holding at December 31, 2011
|
Any sectors, industries, or securities discussed should not be perceived as
investment recommendations. Mention of a specific security should not be considered a recommendation to buy or solicitation to sell that security. Specific securities mentioned in this report may have been sold from the Funds portfolio of
investments by the time you receive this report.
Managers Global Income Opportunity Fund
Schedule of Portfolio Investments
June 30, 2012 (unaudited)
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Principal Amount |
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Value |
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Asset-Backed Securities - 2.9% |
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Avis Budget Rental Car Funding AESOP LLC, Series 2009-2A, Class A, 5.680%, 02/20/14 (a) |
|
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$ |
100,000 |
|
|
$ |
102,091 |
|
Capital One Multi-Asset Execution Trust, Series 2004-B7, Class B7, 1.243%, 08/17/17 (07/18/12)1 |
|
EUR |
|
|
100,000 |
|
|
|
120,162 |
|
Hertz Vehicle Financing LLC, Series 2009-2A, Class A1, 4.260%, 03/25/14 (a) |
|
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|
|
100,000 |
|
|
|
101,802 |
|
Hyundai Capital Auto Funding, Ltd., Series 2010-8A, Class A, 1.243%, 09/20/16 (07/18/12) (a)1 |
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|
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200,000 |
|
|
|
196,747 |
|
MBNA Credit Card Master Note Trust, Series 2005-B3, Class B3, 1.050%, 03/19/18 (07/18/12)1 |
|
EUR |
|
|
100,000 |
|
|
|
117,152 |
|
Santander Drive Auto Receivables Trust, Series 2011-S2A, Class D, 3.350%, 06/15/17 (a) |
|
|
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|
55,248 |
|
|
|
55,248 |
|
Trinity Rail Leasing, L.P., Series 2010-1A, Class A, 5.194%, 10/16/40 (a) |
|
|
|
|
94,295 |
|
|
|
98,094 |
|
World Financial Network Credit Card Master Trust, Series 2010-A, Class A, 3.960%, 04/15/19 |
|
|
|
|
95,000 |
|
|
|
102,701 |
|
Total Asset-Backed Securities (cost $877,282) |
|
|
|
|
|
|
|
|
893,997 |
|
Corporate Bonds and Notes - 38.6% |
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|
|
|
|
|
|
|
|
|
Financials - 17.2% |
|
|
|
|
|
|
|
|
|
|
Allianz Finance II, B.V., EMTN, 5.750%, 07/08/412 |
|
EUR |
|
|
100,000 |
|
|
|
113,980 |
|
AXA SA, 7.125%, 12/15/20 |
|
GBP |
|
|
100,000 |
|
|
|
160,890 |
|
Banco Latinoamericano de Comercio Exterior SA, 3.750%, 04/04/17 (a) |
|
|
|
|
150,000 |
|
|
|
149,250 |
|
Banco Santander Chile, 6.500%, 09/22/20 (a) |
|
CLP |
|
|
100,000,000 |
|
|
|
190,854 |
|
Banco Votorantim SA, 6.250%, 05/16/16 (a) |
|
BRL |
|
|
300,000 |
|
|
|
166,064 |
|
Bank of America Corp., |
|
|
|
|
|
|
|
|
|
|
4.750%, 05/06/192 |
|
EUR |
|
|
100,000 |
|
|
|
106,935 |
|
5.700%, 01/24/22 |
|
|
|
|
140,000 |
|
|
|
154,181 |
|
Barclays Bank PLC, 6.050%, 12/04/17 |
|
|
|
|
100,000 |
|
|
|
101,044 |
|
BBVA Bancomer SA, 6.500%, 03/10/21 (a) |
|
|
|
|
100,000 |
|
|
|
101,000 |
|
BNP Paribas SA, Series BKNT, 5.000%, 01/15/21 |
|
|
|
|
75,000 |
|
|
|
76,989 |
|
BNZ International Funding, Ltd., EMTN, 4.000%, 03/08/17 |
|
EUR |
|
|
100,000 |
|
|
|
133,890 |
|
Braskem Finance, Ltd., 5.750%, 04/15/21 (a) |
|
|
|
|
200,000 |
|
|
|
205,500 |
|
Citigroup, Inc., |
|
|
|
|
|
|
|
|
|
|
5.500%, 02/15/17 |
|
|
|
|
85,000 |
|
|
|
88,820 |
|
6.250%, 06/29/17 |
|
NZD |
|
|
200,000 |
|
|
|
159,803 |
|
Cooperatieve Centrale Raiffeisen-Boerenleenbank BA, EMTN, 4.375%, 01/22/14 |
|
EUR |
|
|
85,000 |
|
|
|
112,884 |
|
Crown Castle Towers LLC, 6.113%, 01/15/20 (a) |
|
|
|
|
100,000 |
|
|
|
115,762 |
|
General Electric Capital Corp., Series A, 7.125%, 12/15/492,3 |
|
|
|
|
200,000 |
|
|
|
211,292 |
|
HSBC Bank PLC, 4.125%, 08/12/20 (a) |
|
|
|
|
100,000 |
|
|
|
104,230 |
|
Hutchison Whampoa International 11, Ltd., 3.500%, 01/13/17 (a) |
|
|
|
|
200,000 |
|
|
|
207,381 |
|
Hyundai Capital Services, Inc., 3.500%, 09/13/17 (a) |
|
|
|
|
200,000 |
|
|
|
201,687 |
|
JPMorgan Chase & Co., 4.400%, 07/22/20 |
|
|
|
|
75,000 |
|
|
|
79,105 |
|
Lloyds TSB Bank PLC, 6.500%, 09/14/20 (a) |
|
|
|
|
100,000 |
|
|
|
98,495 |
|
Morgan Stanley, |
|
|
|
|
|
|
|
|
|
|
5.375%, 11/14/13 |
|
GBP |
|
|
40,000 |
|
|
|
63,924 |
|
5.500%, 07/24/20 |
|
|
|
|
100,000 |
|
|
|
97,837 |
|
MTN, 7.250%, 05/26/15 |
|
AUD |
|
|
200,000 |
|
|
|
206,829 |
|
National Australia Bank, Ltd., GMTN, 4.750%, 07/15/16 |
|
EUR |
|
|
100,000 |
|
|
|
140,002 |
|
Network Rail Infrastructure Finance PLC, EMTN, 3.500%, 06/17/13 |
|
|
|
|
300,000 |
|
|
|
308,592 |
|
Shinhan Bank, 4.375%, 07/27/17 (a) |
|
|
|
|
200,000 |
|
|
|
213,300 |
|
Sirius International Group, Ltd., 6.375%, 03/20/17 (a) |
|
|
|
|
140,000 |
|
|
|
148,175 |
|
|
The accompanying
notes are an integral part of these financial statements. 7 |
Managers Global Income Opportunity Fund
Schedule of Portfolio Investments (continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal Amount |
|
|
Value |
|
Financials - 17.2% (continued) |
|
|
|
|
|
|
|
|
|
|
SLM Corp., MTN, Series A, 5.000%, 10/01/13 |
|
|
|
$ |
150,000 |
|
|
$ |
154,500 |
|
VTB Bank OJSC Via VTB Capital, S.A., 6.000%, 04/12/17 (a) |
|
|
|
|
200,000 |
|
|
|
203,000 |
|
Wells Fargo & Co., 4.625%, 11/02/35 |
|
GBP |
|
|
50,000 |
|
|
|
81,416 |
|
Westpac Banking Corp., 2.450%, 11/28/16 (a) |
|
|
|
|
200,000 |
|
|
|
205,700 |
|
Yapi ve Kredi Bankasi Via Unicredit Luxembourg SA, 5.188%, 10/13/15 (a) |
|
|
|
|
200,000 |
|
|
|
201,500 |
|
Zurich Finance USA, Inc., |
|
|
|
|
|
|
|
|
|
|
EMTN, 4.500%, 06/15/252 |
|
EUR |
|
|
100,000 |
|
|
|
126,310 |
|
EMTN, 5.750%, 10/02/232 |
|
EUR |
|
|
100,000 |
|
|
|
127,496 |
|
Total Financials |
|
|
|
|
|
|
|
|
5,318,617 |
|
Industrials - 18.7% |
|
|
|
|
|
|
|
|
|
|
Asciano Finance, Ltd., 4.625%, 09/23/20 (a) |
|
|
|
|
125,000 |
|
|
|
124,359 |
|
Avnet, Inc., 5.875%, 06/15/20 |
|
|
|
|
60,000 |
|
|
|
66,131 |
|
Bell Aliant Regional Communications LP, 5.410%, 09/26/16 |
|
CAD |
|
|
160,000 |
|
|
|
170,273 |
|
Bell Canada, |
|
|
|
|
|
|
|
|
|
|
MTN, 7.300%, 02/23/32 (a) |
|
CAD |
|
|
130,000 |
|
|
|
164,761 |
|
Series M-17, 6.100%, 03/16/35 (a) |
|
CAD |
|
|
45,000 |
|
|
|
52,312 |
|
BRF - Brasil Foods, S.A., 5.875%, 06/06/22 (a) |
|
|
|
|
200,000 |
|
|
|
206,000 |
|
British Telecommunications PLC, 5.750%, 12/07/28 |
|
GBP |
|
|
100,000 |
|
|
|
173,977 |
|
CSN Resources, S.A., 6.500%, 07/21/20 (a) |
|
|
|
|
100,000 |
|
|
|
108,330 |
|
Delta Air Lines, Inc., 2007-1 Class B Pass Through Trust, Series 071B, 8.021%, 08/10/22 |
|
|
|
|
81,526 |
|
|
|
82,447 |
|
Desarrolladora Homex, S.A.B. de C.V., 9.750%, 03/25/20 (a) |
|
|
|
|
200,000 |
|
|
|
210,000 |
|
DP World, Ltd., 6.850%, 07/02/37 (a) |
|
|
|
|
250,000 |
|
|
|
245,625 |
|
Dubai Electricity & Water Authority, 6.375%, 10/21/16 (a) |
|
|
|
|
200,000 |
|
|
|
215,750 |
|
Edcon Proprietary, Ltd., 3.912%, 06/15/14 (09/15/12) (a)1 |
|
EUR |
|
|
150,000 |
|
|
|
172,513 |
|
ERAC USA Finance LLC, 6.700%, 06/01/34 (a) |
|
|
|
|
120,000 |
|
|
|
137,745 |
|
Fibria Overseas Finance, Ltd., 6.750%, 03/03/21 (a) |
|
|
|
|
150,000 |
|
|
|
149,700 |
|
Finmeccanica S.p.A., 4.875%, 03/24/25 |
|
EUR |
|
|
100,000 |
|
|
|
98,415 |
|
HCA, Inc., |
|
|
|
|
|
|
|
|
|
|
6.375%, 01/15/15 |
|
|
|
|
35,000 |
|
|
|
37,188 |
|
6.500%, 02/15/16 |
|
|
|
|
80,000 |
|
|
|
86,200 |
|
7.690%, 06/15/25 |
|
|
|
|
15,000 |
|
|
|
14,438 |
|
MTN, 7.580%, 09/15/25 |
|
|
|
|
10,000 |
|
|
|
9,550 |
|
Hyatt Hotels Corp., 5.375%, 08/15/21 |
|
|
|
|
90,000 |
|
|
|
98,875 |
|
International Paper Co., 6.000%, 11/15/41 |
|
|
|
|
50,000 |
|
|
|
56,371 |
|
Korea National Oil Corp., 3.125%, 04/03/17 (a) |
|
|
|
|
200,000 |
|
|
|
203,944 |
|
Lafarge SA, Series 2010, EMTN, 6.625%, 11/29/18 |
|
EUR |
|
|
50,000 |
|
|
|
64,857 |
|
Lotte Shopping Co., Ltd., 3.375%, 05/09/17 (a) |
|
|
|
|
200,000 |
|
|
|
203,364 |
|
Methanex Corp., 5.250%, 03/01/22 |
|
|
|
|
285,000 |
|
|
|
295,690 |
|
Nabors Industries, Inc., 4.625%, 09/15/21 |
|
|
|
|
75,000 |
|
|
|
77,929 |
|
NII Capital Corp., 7.625%, 04/01/21 |
|
|
|
|
95,000 |
|
|
|
81,462 |
|
Noble Group, Ltd., 6.750%, 01/29/20 (a) |
|
|
|
|
200,000 |
|
|
|
193,000 |
|
Odebrecht Drilling VIII/IX, Ltd., 6.350%, 06/30/21 (a)4 |
|
|
|
|
98,000 |
|
|
|
102,655 |
|
|
The accompanying
notes are an integral part of these financial statements. 8 |
Managers Global Income Opportunity Fund
Schedule of Portfolio Investments (continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal Amount |
|
|
Value |
|
Industrials - 18.7% (continued) |
|
|
|
|
|
|
|
|
|
|
|
|
OGX Austria GmbH, 8.500%, 06/01/18 (a) |
|
|
|
|
|
$ |
200,000 |
|
|
$ |
178,000 |
|
Oi SA, 9.750%, 09/15/16 (a) |
|
|
BRL |
|
|
|
600,000 |
|
|
|
312,920 |
|
Owens-Illinois, Inc., 7.800%, 05/15/18 |
|
|
|
|
|
|
125,000 |
|
|
|
142,344 |
|
Portugal Telecom International Finance, B.V., EMTN, 5.000%, 11/04/19 |
|
|
EUR |
|
|
|
50,000 |
|
|
|
51,588 |
|
Qwest Corp., 7.250%, 10/15/35 |
|
|
|
|
|
|
158,000 |
|
|
|
159,185 |
|
Reliance Holdings USA, Inc., 5.400%, 02/14/22 (a) |
|
|
|
|
|
|
250,000 |
|
|
|
249,985 |
|
Rowan Companies, Inc., 5.000%, 09/01/17 |
|
|
|
|
|
|
60,000 |
|
|
|
64,587 |
|
Telecom Italia Capital SA, |
|
|
|
|
|
|
|
|
|
|
|
|
6.375%, 11/15/33 |
|
|
|
|
|
|
45,000 |
|
|
|
35,325 |
|
7.200%, 07/18/36 |
|
|
|
|
|
|
20,000 |
|
|
|
16,950 |
|
Telefonica Emisiones, S.A.U., |
|
|
|
|
|
|
|
|
|
|
|
|
5.134%, 04/27/20 |
|
|
|
|
|
|
75,000 |
|
|
|
64,604 |
|
7.045%, 06/20/36 |
|
|
|
|
|
|
75,000 |
|
|
|
65,571 |
|
Transportadora de Gas del Sur SA, 7.875%, 05/14/17 (a) |
|
|
|
|
|
|
235,000 |
|
|
|
163,325 |
|
Urbi Desarrollos Urbanos, S.A.B. de C.V., 9.750%, 02/03/22 (a) |
|
|
|
|
|
|
200,000 |
|
|
|
211,000 |
|
Valeant Pharmaceuticals International, 6.750%, 08/15/21 (a)4 |
|
|
|
|
|
|
60,000 |
|
|
|
58,800 |
|
Voto-Votorantim, Ltd., 6.750%, 04/05/21 (a) |
|
|
|
|
|
|
100,000 |
|
|
|
109,000 |
|
Total Industrials |
|
|
|
|
|
|
|
|
|
|
5,787,045 |
|
Utilities - 2.7% |
|
|
|
|
|
|
|
|
|
|
|
|
Axtel, S.A.B. de C.V., |
|
|
|
|
|
|
|
|
|
|
|
|
7.625%, 02/01/17 (a) |
|
|
|
|
|
|
55,000 |
|
|
|
36,025 |
|
9.000%, 09/22/19 (a) |
|
|
|
|
|
|
45,000 |
|
|
|
29,700 |
|
CEZ A.S., 4.250%, 04/03/22 (a) |
|
|
|
|
|
|
200,000 |
|
|
|
204,914 |
|
Deutsche Telekom International Finance, B.V., EMTN, 4.875%, 04/22/25 |
|
|
EUR |
|
|
|
50,000 |
|
|
|
72,841 |
|
DPL, Inc., 6.500%, 10/15/16 (a) |
|
|
|
|
|
|
90,000 |
|
|
|
97,200 |
|
EDP Finance, B.V., EMTN, 8.625%, 01/04/24 |
|
|
GBP |
|
|
|
50,000 |
|
|
|
69,302 |
|
Emgesa SA ESP, 8.750%, 01/25/21 (a) |
|
|
COP |
|
|
|
120,000,000 |
|
|
|
74,424 |
|
Iberdrola Finance Ireland, Ltd., 5.000%, 09/11/19 (a) |
|
|
|
|
|
|
75,000 |
|
|
|
69,266 |
|
Listrindo Capital, B.V., 6.950%, 02/21/19 (a) |
|
|
|
|
|
|
200,000 |
|
|
|
204,632 |
|
Total Utilities |
|
|
|
|
|
|
|
|
|
|
858,304 |
|
Total Corporate Bonds and Notes (cost $11,806,215) |
|
|
|
|
|
|
|
|
|
|
11,963,966 |
|
Foreign Government and Agency Obligations - 40.8% |
|
|
|
|
|
|
|
|
|
|
|
|
Australian Government Index Linked Bonds, Series 2009-25CI, 3.000%, 09/20/25 |
|
|
AUD |
|
|
|
180,000 |
|
|
|
254,329 |
|
Bundesrepublik Deutschland Bonds, |
|
|
|
|
|
|
|
|
|
|
|
|
Bonds, 3.000%, 07/04/20 |
|
|
EUR |
|
|
|
60,000 |
|
|
|
85,928 |
|
Series 05, 4.000%, 01/04/37 |
|
|
EUR |
|
|
|
110,000 |
|
|
|
182,189 |
|
Series 06, 3.750%, 01/04/17 |
|
|
EUR |
|
|
|
465,000 |
|
|
|
672,049 |
|
Canadian Government, |
|
|
|
|
|
|
|
|
|
|
|
|
Bonds, 4.000%, 06/01/16 |
|
|
CAD |
|
|
|
260,000 |
|
|
|
282,514 |
|
Notes, 3.000%, 12/01/15 |
|
|
CAD |
|
|
|
675,000 |
|
|
|
703,363 |
|
Central American Bank for Economic Integration Notes, 3.875%, 02/09/17 (a) |
|
|
|
|
|
|
280,000 |
|
|
|
289,438 |
|
Corp. Andina de Fomento, Notes, 4.375%, 06/15/22 |
|
|
|
|
|
|
280,000 |
|
|
|
286,001 |
|
|
The accompanying
notes are an integral part of these financial statements. 9 |
Managers Global Income Opportunity Fund
Schedule of Portfolio Investments (continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal Amount |
|
|
Value |
|
Foreign Government and Agency Obligations - 40.8% (continued) |
|
|
|
|
|
|
|
|
|
|
|
|
Eksportfinans ASA Notes, 2.000%, 09/15/15 |
|
|
|
|
|
$ |
120,000 |
|
|
$ |
107,393 |
|
Empresas Publicas de Medellin ESP Notes, 8.375%, 02/01/21 (a) |
|
|
COP |
|
|
|
180,000,000 |
|
|
|
109,253 |
|
European Investment Bank, |
|
|
|
|
|
|
|
|
|
|
|
|
Bonds, 2.375%, 07/10/20 |
|
|
CHF |
|
|
|
165,000 |
|
|
|
189,071 |
|
Notes, 6.675%, 04/24/13 (a)5 |
|
|
IDR |
|
|
|
1,842,000,000 |
|
|
|
183,570 |
|
Export-Import Bank of Korea Notes, 4.000%, 11/26/15 (a) |
|
|
PHP |
|
|
|
5,000,000 |
|
|
|
118,714 |
|
Iceland Government International Notes, 5.875%, 05/11/22 |
|
|
|
|
|
|
300,000 |
|
|
|
290,934 |
|
Inter-American Development Bank Notes, 6.827%, 08/20/155 |
|
|
IDR |
|
|
|
750,000,000 |
|
|
|
65,853 |
|
International Bank for Reconstruction & Development Notes, GMTN, 2.300%, 02/26/13 |
|
|
KRW |
|
|
|
600,000,000 |
|
|
|
520,180 |
|
Italy Buoni Poliennali Del Tesoro Bonds, 5.000%, 03/01/22 |
|
|
EUR |
|
|
|
125,000 |
|
|
|
150,921 |
|
Japan Government, |
|
|
|
|
|
|
|
|
|
|
|
|
Bonds, Series 299, 1.300%, 03/20/19 |
|
|
JPY |
|
|
|
22,500,000 |
|
|
|
297,904 |
|
Notes, Series 84, 0.700%, 06/20/14 |
|
|
JPY |
|
|
|
71,850,000 |
|
|
|
909,482 |
|
Korea Treasury Notes, Series 1409, 5.000%, 09/10/14 |
|
|
KRW |
|
|
|
430,000,000 |
|
|
|
388,680 |
|
Malaysian Government Bonds, Series 1/06, 4.262%, 09/15/16 |
|
|
MYR |
|
|
|
375,000 |
|
|
|
123,253 |
|
Mexican Fixed Rate, |
|
|
|
|
|
|
|
|
|
|
|
|
Bonds, 8.000%, 12/07/23 |
|
|
MXN |
|
|
|
6,800,000 |
|
|
|
616,325 |
|
Bonds, Series M-30, 8.500%, 11/18/38 |
|
|
MXN |
|
|
|
4,500,000 |
|
|
|
408,128 |
|
Bonds, Series M, 6.500%, 06/10/21 |
|
|
MXN |
|
|
|
3,350,000 |
|
|
|
271,612 |
|
Notes, 7.750%, 12/14/17 |
|
|
MXN |
|
|
|
11,650,000 |
|
|
|
989,753 |
|
Notes, Series M 10, 8.500%, 12/13/18 |
|
|
MXN |
|
|
|
1,600,000 |
|
|
|
142,468 |
|
New South Wales Treasury Corp. Bonds, Series 2007 CIB1, 2.750%, 11/20/25 |
|
|
AUD |
|
|
|
70,000 |
|
|
|
90,046 |
|
New Zealand Government Bonds, Series 521, 6.000%, 05/15/21 |
|
|
NZD |
|
|
|
335,000 |
|
|
|
322,418 |
|
Norway Government Bonds, Series 473, 4.500%, 05/22/19 |
|
|
NOK |
|
|
|
2,570,000 |
|
|
|
509,874 |
|
Poland Government, |
|
|
|
|
|
|
|
|
|
|
|
|
Bonds, 5.000%, 03/23/22 |
|
|
|
|
|
|
250,000 |
|
|
|
272,875 |
|
Notes, EMTN, 3.000%, 09/23/14 |
|
|
CHF |
|
|
|
65,000 |
|
|
|
71,379 |
|
Republic of Latvia Notes, 5.250%, 02/22/17 |
|
|
|
|
|
|
200,000 |
|
|
|
206,500 |
|
Singapore Government, |
|
|
|
|
|
|
|
|
|
|
|
|
Bonds, 2.250%, 07/01/13 |
|
|
SGD |
|
|
|
120,000 |
|
|
|
96,682 |
|
Bonds, 2.250%, 06/01/21 |
|
|
SGD |
|
|
|
210,000 |
|
|
|
177,117 |
|
Notes, 1.625%, 04/01/13 |
|
|
SGD |
|
|
|
535,000 |
|
|
|
426,661 |
|
Spain Government Notes, 4.250%, 10/31/16 |
|
|
EUR |
|
|
|
150,000 |
|
|
|
179,863 |
|
U.K. Gilt, |
|
|
|
|
|
|
|
|
|
|
|
|
Bonds, 4.000%, 03/07/22 |
|
|
GBP |
|
|
|
145,000 |
|
|
|
272,630 |
|
Bonds, 4.250%, 03/07/36 |
|
|
GBP |
|
|
|
120,000 |
|
|
|
231,708 |
|
Bonds, 4.750%, 03/07/20 |
|
|
GBP |
|
|
|
90,000 |
|
|
|
175,543 |
|
Bonds, 5.000%, 03/07/25 |
|
|
GBP |
|
|
|
110,000 |
|
|
|
228,300 |
|
Notes, 1.750%, 01/22/17 |
|
|
GBP |
|
|
|
220,000 |
|
|
|
359,892 |
|
Uruguay Government International Bonds, |
|
|
|
|
|
|
|
|
|
|
|
|
3.700%, 06/26/37 |
|
|
UYU |
|
|
|
800,000 |
|
|
|
52,818 |
|
4.375%, 12/15/28 |
|
|
UYU |
|
|
|
1,630,109 |
|
|
|
85,734 |
|
5.000%, 09/14/18 |
|
|
UYU |
|
|
|
3,000,000 |
|
|
|
231,379 |
|
Total Foreign Government and Agency Obligations (cost $12,082,647) |
|
|
|
|
|
|
|
|
|
|
12,630,724 |
|
|
The accompanying
notes are an integral part of these financial statements. 10 |
Managers Global Income Opportunity Fund
Schedule of Portfolio Investments (continued)
|
|
|
|
|
|
|
|
|
|
|
Principal Amount |
|
|
Value |
|
Mortgage-Backed Securities - 1.5% |
|
|
|
|
|
|
|
|
Extended Stay America Trust, Series 2010-ESHA, Class D, 5.498%, 11/05/27 (a) |
|
$ |
135,000 |
|
|
$ |
136,256 |
|
Greenwich Capital Commercial Funding Corp., Series 2007-GG11, Class A4, 5.736%, 12/10/49 |
|
|
75,000 |
|
|
|
83,111 |
|
GS Mortgage Securities Corp. II, Series 2007-GG10, Class A4, 5.979%, 08/10/452 |
|
|
91,000 |
|
|
|
100,993 |
|
Morgan Stanley Capital I, Inc., Series 2007-IQ14, Class A4, 5.692%, 04/15/492 |
|
|
50,000 |
|
|
|
55,031 |
|
Wachovia Bank Commercial Mortgage Trust, Series 2007-C30, Class A5, 5.342%, 12/15/43 |
|
|
75,000 |
|
|
|
80,933 |
|
Total Mortgage-Backed Securities (cost $444,037) |
|
|
|
|
|
|
456,324 |
|
Municipal Bonds - 0.2% |
|
|
|
|
|
|
|
|
California Statewide Communities Development Authority Revenue, Series 2007 A, 4.750%, 04/01/33 (cost $45,871) |
|
|
55,000 |
|
|
|
56,142 |
|
U.S. Government Obligations - 11.6% |
|
|
|
|
|
|
|
|
U.S. Treasury Notes, |
|
|
|
|
|
|
|
|
0.250%, 02/15/15 |
|
|
2,650,000 |
|
|
|
2,640,683 |
|
1.375%, 11/30/15 |
|
|
120,000 |
|
|
|
123,534 |
|
1.500%, 07/31/166 |
|
|
240,000 |
|
|
|
248,644 |
|
2.250%, 03/31/16 |
|
|
540,000 |
|
|
|
574,257 |
|
Total U.S. Government Obligations (cost $3,575,706) |
|
|
|
|
|
|
3,587,118 |
|
|
|
|
|
|
Shares |
|
|
|
|
Other Investment Companies - 1.7%7 |
|
|
|
|
|
|
|
|
BNY Mellon Overnight Government Fund, 0.18%8 |
|
|
163,210 |
|
|
|
163,210 |
|
Dreyfus Cash Management Fund, Institutional Class Shares, 0.08% |
|
|
352,945 |
|
|
|
352,945 |
|
Total Other Investment Companies (cost $516,155) |
|
|
|
|
|
|
516,155 |
|
Total Investments - 97.3% (cost $29,347,913) |
|
|
|
|
|
|
30,104,426 |
|
Other Assets, less Liabilities - 2.7% |
|
|
|
|
|
|
846,020 |
|
Net Assets - 100.0% |
|
|
|
|
|
$ |
30,950,446 |
|
|
The accompanying
notes are an integral part of these financial statements. 11 |
Notes to Schedule of Portfolio Investments (unaudited)
The following footnotes and
abbreviations should be read in conjunction with the Schedule of Portfolio Investments previously presented in this report.
Based on the approximate cost of investments of $29,348,174 for Federal income tax purposes at June 30, 2012, the aggregate gross
unrealized appreciation and depreciation were $1,204,532 and $448,280, respectively, resulting in net unrealized appreciation of investments of $756,252.
* |
Non-income-producing security. |
(a) |
Security exempt from registration under Rule 144A of the Securities Act of 1933. This security may be resold in transactions exempt from registration, normally to
qualified buyers. At June 30, 2012, the value of these securities amounted to $8,392,360, or 27.1% of net assets. |
1 |
Floating Rate Security. The rate listed is as of June 30, 2012. Date in parentheses represents the securitys next coupon rate reset.
|
2 |
Variable Rate Security. The rate listed is as of June 30, 2012, and is periodically reset subject to terms and conditions set forth in the
debenture. |
3 |
Perpetuity Bond. The date shown is the final call date. |
4 |
Some or all of these securities, amounting to a market value of $155,373, or 0.5% of net assets, were out on loan to various brokers.
|
5 |
Represents yield to maturity at June 30, 2012. |
6 |
Some or all of this security is held as collateral for futures contracts, amounting to a market value of $25,900, or 0.1% of net assets.
|
7 |
Yield shown represents the June 30, 2012, seven-day average yield, which refers to the sum of the previous seven days dividends paid,
expressed as an annual percentage. |
8 |
Collateral received from brokers for securities lending was invested in this short-term investment. |
The following tables summarize the inputs used to value the Funds net assets by the above fair value hierarchy levels as of
June 30, 2012. (See Note 1(a) in the Notes to the Financial Statements.)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quoted Prices in
Active Markets for Identical Investments Level 1 |
|
|
Significant Other Observable
Inputs Level 2 |
|
|
Significant Unobservable Inputs Level 3 |
|
|
Total |
|
Investments in Securities |
|
|
|
|
|
|
|
|
|
|
|
|
Asset-Backed Securities |
|
|
|
|
|
$ |
893,997 |
|
|
|
|
|
|
$ |
893,997 |
|
Corporate Bonds and Notes |
|
|
|
|
|
|
11,963,966 |
|
|
|
|
|
|
|
11,963,966 |
|
Foreign Government and Agency Obligations |
|
|
|
|
|
|
12,630,724 |
|
|
|
|
|
|
|
12,630,724 |
|
Mortgage-Backed Securities |
|
|
|
|
|
|
456,324 |
|
|
|
|
|
|
|
456,324 |
|
Municipal Bonds |
|
|
|
|
|
|
56,142 |
|
|
|
|
|
|
|
56,142 |
|
U.S. Government Obligations |
|
|
|
|
|
|
3,587,118 |
|
|
|
|
|
|
|
3,587,118 |
|
Other Investment Companies |
|
$ |
516,155 |
|
|
|
|
|
|
|
|
|
|
|
516,155 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Investments in Securities |
|
$ |
516,155 |
|
|
$ |
29,588,271 |
|
|
|
|
|
|
$ |
30,104,426 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Derivative Instruments-Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign Exchange Contracts |
|
|
|
|
|
$ |
27,783 |
|
|
|
|
|
|
$ |
27,783 |
|
Interest Rate Contracts |
|
$ |
1,637 |
|
|
|
|
|
|
|
|
|
|
|
1,637 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,637 |
|
|
|
27,783 |
|
|
|
|
|
|
|
29,420 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Derivative Instruments-Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign Exchange Contracts |
|
|
|
|
|
|
(40,919 |
) |
|
|
|
|
|
|
(40,919 |
) |
Interest Rate Contracts |
|
|
(2,878 |
) |
|
|
|
|
|
|
|
|
|
|
(2,878 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,878 |
) |
|
|
(40,919 |
) |
|
|
|
|
|
|
(43,797 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Financial Derivative Instruments |
|
$ |
(1,241 |
) |
|
$ |
(13,136 |
) |
|
|
|
|
|
$ |
(14,377 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All corporate bonds and notes and U.S. government and agency obligations held in the Fund are level 2 securities. For a detailed breakout of the
corporate bonds and notes and U.S. government and agency obligations by major industry or agency classification, please refer to the Schedule of Portfolio Investments. |
|
Derivative instruments, such as futures and forwards contracts, are not reflected in the Schedule of Portfolio Investments and are valued at the
unrealized appreciation/depreciation of the instrument. |
As of June 30, 2012, the Fund had no transfers
between Level 1 and Level 2 from the beginning of the reporting period.
|
The accompanying
notes are an integral part of these financial statements. 12 |
Notes to Schedule of Portfolio Investments (continued)
The following schedule is the fair value of derivative instruments at June 30, 2012:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset Derivatives |
|
|
Liability Derivatives |
|
Derivatives not accounted for as hedging instruments |
|
Statement of Assets and Liabilities Location |
|
Fair Value |
|
|
Statement of Assets and Liabilities Location |
|
Fair Value |
|
Interest rate contracts |
|
Variation margin receivable* |
|
$ |
2,695 |
|
|
Variation margin payable* |
|
$ |
3,750 |
|
Foreign exchange contracts |
|
Unrealized appreciation of foreign currency contracts |
|
|
27,783 |
|
|
Unrealized depreciation of foreign currency contracts |
|
|
40,919 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Totals |
|
|
|
$ |
30,478 |
|
|
|
|
$ |
44,669 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* |
Includes only the June 30, 2012 futures variation margin. Prior futures variation margin movements have been reflected in cash on the Statement of Assets and
Liabilities upon receipt or payment. |
For the six months ended June 30, 2012, the effect of derivative
instruments on the Statement of Operations and the amount of realized gain/(loss) on derivatives recognized in income were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivatives not accounted for as hedging instruments |
|
Futures |
|
|
Forward Currency Contracts |
|
|
Total |
|
Interest rate contracts |
|
$ |
(8,351 |
) |
|
|
|
|
|
$ |
(8,351 |
) |
Foreign exchange contracts |
|
|
|
|
|
$ |
(57,457 |
) |
|
|
(57,457 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Totals |
|
$ |
(8,351 |
) |
|
$ |
(57,457 |
) |
|
$ |
(65,808 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
The change in unrealized gain/(loss) on derivatives recognized in income were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivatives not accounted for as hedging instruments |
|
Futures |
|
|
Forward Currency Contracts |
|
|
Total |
|
Interest rate contracts |
|
$ |
2,504 |
|
|
|
|
|
|
$ |
2,504 |
|
Foreign exchange contracts |
|
|
|
|
|
$ |
(10,977 |
) |
|
|
(10,977 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Totals |
|
$ |
2,504 |
|
|
$ |
(10,977 |
) |
|
$ |
(8,473 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
At June 30, 2012, the Fund had the following futures contracts:
(See Note 9 in the Notes to the Financial Statements.)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Type |
|
Number of Contracts |
|
|
Position |
|
|
Expiration Date |
|
|
Unrealized Gain/(Loss) |
|
10-Year U.S. Treasury Note |
|
|
3 |
|
|
|
Short |
|
|
|
09/19/12 |
|
|
$ |
(1,775 |
) |
5-Year U.S. Treasury Note |
|
|
5 |
|
|
|
Short |
|
|
|
09/28/12 |
|
|
|
(1,103 |
) |
U.S. Treasury Long Bond |
|
|
2 |
|
|
|
Long |
|
|
|
09/19/12 |
|
|
|
1,637 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
(1,241 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The accompanying
notes are an integral part of these financial statements. 13 |
Notes to Schedule of Portfolio Investments (continued)
At June 30, 2012, the Fund had the following forward foreign currency contracts (in U.S. dollars):
(See Note 8 in the Notes to Financial Statements.)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign Currency |
|
Position |
|
Settlement Date |
|
Counterparty |
|
Receivable Amount |
|
|
Payable Amount |
|
|
Unrealized Gain/ (Loss) |
|
Brazilian Real |
|
Long |
|
08/06/12 to 11/13/12 |
|
CS |
|
$ |
296,638 |
|
|
$ |
304,439 |
|
|
$ |
(7,801 |
) |
Euro |
|
Long |
|
09/12/12 |
|
DDB |
|
|
229,021 |
|
|
|
225,428 |
|
|
|
3,592 |
|
Malaysian Ringgit |
|
Long |
|
09/21/12 |
|
MSC |
|
|
266,326 |
|
|
|
267,481 |
|
|
|
(1,155 |
) |
South Korean Won |
|
Long |
|
09/10/12 |
|
BRC |
|
|
505,991 |
|
|
|
491,535 |
|
|
|
14,457 |
|
South Korean Won |
|
Long |
|
09/10/12 |
|
CS |
|
|
147,704 |
|
|
|
143,363 |
|
|
|
4,341 |
|
Australian Dollar |
|
Short |
|
08/29/12 |
|
CS |
|
|
488,780 |
|
|
|
508,751 |
|
|
|
(19,971 |
) |
Canadian Dollar |
|
Short |
|
09/07/12 |
|
CS |
|
|
455,581 |
|
|
|
460,913 |
|
|
|
(5,332 |
) |
New Zealand Dollar |
|
Short |
|
07/31/12 |
|
BRC |
|
|
308,245 |
|
|
|
303,529 |
|
|
|
4,716 |
|
Norwegian Krone |
|
Short |
|
09/12/12 |
|
DDB |
|
|
225,428 |
|
|
|
231,339 |
|
|
|
(5,911 |
) |
Pound Sterling |
|
Short |
|
09/28/12 |
|
BRC |
|
|
266,859 |
|
|
|
266,182 |
|
|
|
677 |
|
Swiss Franc |
|
Short |
|
09/19/12 |
|
UBS |
|
|
62,601 |
|
|
|
63,350 |
|
|
|
(749 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Totals |
|
|
|
|
|
|
|
$ |
3,253,174 |
|
|
$ |
3,266,310 |
|
|
$ |
(13,136 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments Definitions and Abbreviations: |
EMTN: |
|
European Medium-Term Notes |
ESHA: |
|
Extended Stay Hotels America |
GMTN: |
|
Global Multi-Currency Notes |
MTN: |
|
Medium-Term Note |
|
|
|
Counterparty Abbreviations: |
BRC: |
|
Barclays Bank PLC |
CS: |
|
Credit Suisse |
DDB: |
|
Den Danske Bank |
MSC: |
|
Morgan Stanley |
UBS: |
|
UBS Securities |
Currency abbreviations have been used throughout the portfolio to indicate amounts shown in currencies
other than the U.S. dollar (USD):
|
|
|
AUD: |
|
Australian Dollar |
BRL: |
|
Brazilian Real |
CAD: |
|
Canadian Dollar |
CHF: |
|
Swiss Franc |
CLP: |
|
Chilean Peso |
COP: |
|
Colombian Peso |
EUR: |
|
Euro |
GBP: |
|
British Pound |
IDR: |
|
Indonesian Rupiah |
JPY: |
|
Japanese Yen |
KRW: |
|
South Korean Won |
MXN: |
|
Mexican Peso |
MYR: |
|
Malaysia Ringgit |
NOK: |
|
Norwegian Krone |
NZD: |
|
New Zealand Dollar |
PHP: |
|
Philippine Peso |
SGD: |
|
Singapore Dollar |
UYU: |
|
Uruguayan Peso |
|
The accompanying
notes are an integral part of these financial statements. 14 |
Statement of Assets and Liabilities
June 30, 2012 (unaudited)
|
|
|
|
|
Assets: |
|
|
|
|
Investments at value* (including securities on loan valued at $155,373) |
|
$ |
30,104,426 |
|
Foreign currency** |
|
|
764,750 |
|
Dividends, interest and other receivables |
|
|
300,643 |
|
Receivable for Fund shares sold |
|
|
42,204 |
|
Unrealized appreciation on foreign currency contracts |
|
|
27,783 |
|
Receivable from affiliate |
|
|
6,213 |
|
Variation margin receivable |
|
|
2,695 |
|
Prepaid expenses |
|
|
10,516 |
|
Total assets |
|
|
31,259,230 |
|
Liabilities: |
|
|
|
|
Payable upon return of securities loaned |
|
|
163,210 |
|
Unrealized depreciation on foreign currency contracts |
|
|
40,919 |
|
Payable for Fund shares repurchased |
|
|
37,787 |
|
Variation margin payable |
|
|
3,750 |
|
Accrued expenses: |
|
|
|
|
Investment advisory and management fees |
|
|
17,594 |
|
Administrative fees |
|
|
5,027 |
|
Custodian |
|
|
18,886 |
|
Professional fees |
|
|
18,357 |
|
Other |
|
|
3,254 |
|
Total liabilities |
|
|
308,784 |
|
|
|
Net Assets |
|
$ |
30,950,446 |
|
Net Assets Represent: |
|
|
|
|
Paid-in capital |
|
$ |
32,874,776 |
|
Undistributed net investment income |
|
|
682,920 |
|
Accumulated net realized loss from investments, futures contracts and foreign currency transactions |
|
|
(3,353,200 |
) |
Net unrealized appreciation of investments, futures contracts and foreign currency translations |
|
|
745,950 |
|
Net Assets |
|
$ |
30,950,446 |
|
Shares outstanding |
|
|
1,542,558 |
|
Net asset value, offering and redemption price per share |
|
$ |
20.06 |
|
* Investments at cost |
|
$ |
29,347,913 |
|
** Foreign currency at cost |
|
$ |
758,897 |
|
|
The accompanying
notes are an integral part of these financial statements. 15 |
Statement of Operations
For the six months ended June 30, 2012 (unaudited)
|
|
|
|
|
|
|
|
|
|
Interest income |
|
$ |
528,263 |
|
Securities lending income |
|
|
1,900 |
|
Dividend income |
|
|
1,113 |
|
Foreign withholding tax |
|
|
(5,512 |
) |
Total investment income |
|
|
525,764 |
|
Expenses: |
|
|
|
|
Investment advisory and management fees |
|
|
101,541 |
|
Administrative fees |
|
|
29,012 |
|
Custodian |
|
|
22,561 |
|
Professional fees |
|
|
19,881 |
|
Registration fees |
|
|
12,544 |
|
Transfer agent |
|
|
6,263 |
|
Reports to shareholders |
|
|
6,245 |
|
Trustees fees and expenses |
|
|
1,139 |
|
Insurance |
|
|
417 |
|
Miscellaneous |
|
|
188 |
|
Total expenses before offsets |
|
|
199,791 |
|
Expense reimbursements |
|
|
(40,223 |
) |
Expense reductions |
|
|
(4 |
) |
Net expenses |
|
|
159,564 |
|
|
|
Net investment income |
|
|
366,200 |
|
Net Realized and Unrealized Gain (Loss): |
|
|
|
|
Net realized gain on investments and futures contracts |
|
|
386,207 |
|
Net realized loss on foreign currency transactions |
|
|
(62,962 |
) |
Net change in unrealized appreciation (depreciation) of investments, futures contracts and foreign currency
translations |
|
|
308,980 |
|
Net realized and unrealized gain |
|
|
632,225 |
|
|
|
Net increase in net assets resulting from operations |
|
$ |
998,425 |
|
|
The accompanying
notes are an integral part of these financial statements. 16 |
Statements of Changes in Net Assets
For the six months ended June 30, 2012 (unaudited) and for the year ended December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
2012 |
|
|
2011 |
|
Increase (Decrease) in Net Assets From Operations: |
|
|
|
|
|
|
|
|
Net investment income |
|
$ |
366,200 |
|
|
$ |
671,037 |
|
Net realized gain on investments, futures contracts and foreign currency transactions |
|
|
323,245 |
|
|
|
739,119 |
|
Net change in unrealized appreciation (depreciation) of investments, futures contracts and foreign currency
translations |
|
|
308,980 |
|
|
|
(565,124 |
) |
Net increase in net assets resulting from operations |
|
|
998,425 |
|
|
|
845,032 |
|
Distributions to Shareholders: |
|
|
|
|
|
|
|
|
From net investment income |
|
|
|
|
|
|
(850,157 |
) |
From Capital Share Transactions: |
|
|
|
|
|
|
|
|
Proceeds from sale of shares |
|
|
9,023,080 |
|
|
|
9,189,578 |
|
Reinvestment of dividends and distributions |
|
|
|
|
|
|
751,971 |
|
Cost of shares repurchased |
|
|
(3,678,948 |
) |
|
|
(11,050,797 |
) |
Net increase (decrease) from capital share transactions |
|
|
5,344,132 |
|
|
|
(1,109,248 |
) |
|
|
|
Total increase (decrease) in net assets |
|
|
6,342,557 |
|
|
|
(1,114,373 |
) |
Net Assets: |
|
|
|
|
|
|
|
|
Beginning of period |
|
|
24,607,889 |
|
|
|
25,722,262 |
|
End of period |
|
$ |
30,950,446 |
|
|
$ |
24,607,889 |
|
End of period undistributed net investment income |
|
$ |
682,920 |
|
|
$ |
316,720 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Share Transactions: |
|
|
|
|
|
|
|
|
Sale of shares |
|
|
452,815 |
|
|
|
459,246 |
|
Reinvested shares from dividends and distributions |
|
|
|
|
|
|
39,104 |
|
Shares repurchased |
|
|
(185,258 |
) |
|
|
(554,249 |
) |
Net increase (decrease) in shares |
|
|
267,557 |
|
|
|
(55,899 |
) |
|
The accompanying
notes are an integral part of these financial statements. 17 |
Managers Global Income Opportunity Fund
Financial Highlights
For a share outstanding throughout each period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the six months ended June 30, 2012 (unaudited) |
|
|
For the year ended December 31, |
|
|
|
2011 |
|
|
2010 |
|
|
2009 |
|
|
2008 |
|
|
2007 |
|
Net Asset Value, Beginning of Period |
|
$ |
19.30 |
|
|
$ |
19.33 |
|
|
$ |
18.82 |
|
|
$ |
16.93 |
|
|
$ |
21.31 |
|
|
$ |
21.17 |
|
Income from Investment Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income1 |
|
|
0.25 |
|
|
|
0.53 |
|
|
|
0.50 |
|
|
|
0.89 |
|
|
|
0.76 |
|
|
|
0.70 |
|
Net realized and unrealized gain (loss) on investments1 |
|
|
0.51 |
|
|
|
0.12 |
|
|
|
0.87 |
|
|
|
3.22 |
|
|
|
(2.93 |
) |
|
|
0.88 |
|
Total from investment operations |
|
|
0.76 |
|
|
|
0.65 |
|
|
|
1.37 |
|
|
|
4.11 |
|
|
|
(2.17 |
) |
|
|
1.58 |
|
Less Distributions to Shareholders from: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income |
|
|
|
|
|
|
(0.68 |
) |
|
|
(0.86 |
) |
|
|
(2.22 |
) |
|
|
(2.18 |
) |
|
|
(1.43 |
) |
Net realized gain on investments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(0.03 |
) |
|
|
(0.01 |
) |
Total distributions to shareholders |
|
|
|
|
|
|
(0.68 |
) |
|
|
(0.86 |
) |
|
|
(2.22 |
) |
|
|
(2.21 |
) |
|
|
(1.44 |
) |
Net Asset Value, End of Period |
|
$ |
20.06 |
|
|
$ |
19.30 |
|
|
$ |
19.33 |
|
|
$ |
18.82 |
|
|
$ |
16.93 |
|
|
$ |
21.31 |
|
Total Return2 |
|
|
3.94 |
%4,5 |
|
|
3.39 |
% |
|
|
7.27 |
% |
|
|
24.27 |
%4 |
|
|
(10.07 |
)%4 |
|
|
7.52 |
%4 |
Ratio of net expenses to average net assets |
|
|
1.10 |
%6 |
|
|
1.10 |
% |
|
|
1.10 |
% |
|
|
1.10 |
% |
|
|
1.10 |
% |
|
|
1.19 |
% |
Ratio of net investment income to average net assets2 |
|
|
2.52 |
%6 |
|
|
2.63 |
% |
|
|
2.57 |
% |
|
|
4.82 |
% |
|
|
3.62 |
% |
|
|
3.25 |
% |
Portfolio turnover |
|
|
35 |
%5 |
|
|
91 |
% |
|
|
131 |
% |
|
|
102 |
% |
|
|
56 |
% |
|
|
152 |
% |
Net assets at end of period (000s omitted) |
|
$ |
30,950 |
|
|
$ |
24,608 |
|
|
$ |
25,722 |
|
|
$ |
26,146 |
|
|
$ |
47,735 |
|
|
$ |
92,124 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratios absent expense offsets:3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratio of total expenses to average net assets |
|
|
1.38 |
%6 |
|
|
1.39 |
% |
|
|
1.43 |
% |
|
|
1.32 |
% |
|
|
1.25 |
% |
|
|
1.25 |
% |
Ratio of net investment income to average net assets |
|
|
2.24 |
%6 |
|
|
2.34 |
% |
|
|
2.24 |
% |
|
|
4.60 |
% |
|
|
3.47 |
% |
|
|
3.18 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes to Financial Highlights (unaudited)
The following footnotes should be read in conjunction with the Financial Highlights of the Fund previously presented in this report.
1 |
Per share numbers have been calculated using average shares. |
2 |
Total returns and net investment income would have been lower had certain expenses not been reduced. (See Note 1(c) of Notes to Financial Statements.)
|
3 |
Excludes the impact of interest expense (reimbursements)/recoupment and expense reductions such as brokerage credits, but includes non-reimbursable
expenses, if any, such as interest and taxes. (See Note 1(c) of Notes to Financial Statements.) |
4 |
The Total Return is based on the Financial Statement Net Asset Values as shown above. |
18
Notes to Financial Statements
June 30, 2012 (unaudited)
1. |
Summary of Significant Accounting Policies |
The Managers Funds (the Trust) is an open-end management investment company organized as a Massachusetts business trust, and registered under the Investment Company Act of 1940, as amended
(the 1940 Act). Currently, the Trust consists of a number of different funds, each having distinct investment management objectives, strategies, risks and policies. Included in this report is the Managers Global Income Opportunity Fund
(formerly Managers Global Bond Fund) (the Fund). The Fund will deduct a 1.00% redemption fee from the proceeds of any redemption (including a redemption by exchange) of shares if the redemption occurs within 60 days of the purchase of
those shares.
The Funds financial statements are prepared in accordance with accounting principles generally accepted
in the United States of America (U.S. GAAP), which require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates and such differences could be material. The following is a summary of significant accounting policies
followed by the Fund in the preparation of its financial statements:
a. |
Valuation of Investments |
Equity securities traded on a domestic or international securities exchange are valued at the last quoted sale price, or, lacking any sales, at the last quoted bid price. Over-the-counter securities are
valued at the Nasdaq Official Closing Price, if one is available. Lacking any sales, over-the-counter securities are valued at the last quoted bid price. The Funds investments are generally valued based on market quotations provided by
third-party pricing services approved by the Board of Trustees of the Fund (the Board).
Fixed-income securities
are valued based on valuations furnished by independent pricing services that utilize matrix systems, which reflect such factors as security prices, yields, maturities, and ratings, and are supplemented by dealer and exchange quotations. Futures
contracts for which market quotations are readily available are valued at the settlement price as of the close of the futures exchange. Short-term investments having a remaining maturity of 60 days or less are generally valued at amortized cost,
which approximates market value. Investments in other open-end regulated investment companies are valued at their end of day net asset value per share.
Under certain circumstances, the value of certain Fund investments (including derivatives) may be based on an evaluation of fair value, pursuant to procedures established by and under the general
supervision of the Board. The Pricing Committee is the committee formed by the Board to make fair value determinations for such investments. When determining the fair value of an investment, the
Pricing Committee seeks to determine the price that the Fund might reasonably expect to receive from a current sale of that investment in an arms-length transaction. Fair value
determinations shall be based upon consideration of all available facts and information, including, but not limited to (i) attributes specific to the investment; (ii) fundamental analytical data and press releases relating to the
investment and its issuer; (iii) the value of comparable securities or relevant financial instruments, including derivative securities, traded on other markets or among dealers; and (iv) other factors, such as future cash flows, interest
rates, yield curves, volatilities, credit risks and/or default rates. The Board will be presented with a quarterly report comparing fair values determined by the Pricing Committee against subsequent market valuations for those securities. The values
assigned to fair value investments are based on available information and do not necessarily represent amounts that might ultimately be realized, since such amounts depend on future developments inherent in long-term investments. Further, because of
the inherent uncertainty of valuation, those estimated values may differ significantly from the values that would have been used had a ready market for the investments existed, and the differences could be material. The Fund may use the fair value
of a portfolio investment to calculate its net asset value (NAV) when, for example, (1) market quotations are not readily available because a portfolio investment is not traded in a public market or the principal market in which the
investment trades is closed, (2) trading in a portfolio investment is suspended and has not resumed before the Fund calculates its NAV, (3) a significant event affecting the value of a portfolio investment is determined to have occurred
between the time of the market quotation provided for a portfolio investment and the time as of which the Fund calculates its NAV, (4) an investments price has remained unchanged over a period of time (often referred to as a stale
price), or (5) Managers Investment Group LLC (the Investment Manager) determines that a market quotation is inaccurate. Portfolio investments that trade primarily on foreign markets are priced based upon the market quotation
of such securities as of the close of their respective principal markets, as adjusted to reflect the Investment Managers determination of the impact of events occurring subsequent to the close of such markets but prior to the time as of which
the Fund calculates its NAV. Under certain circumstances, the Investment Manager may adjust such prices based on its determination of the impact of events occurring subsequent to the close of such markets but prior to the time as of which the Fund
calculates its NAV. The Fund may invest in securities that may be thinly traded. The Board has adopted procedures to adjust prices of thinly traded securities that are judged to be stale so that they reflect fair value. An investment valued on the
basis of its fair value may be valued at a price higher or lower than available market quotations. An investments valuation may differ depending on the method used and the factors considered in determining value according to the Funds
fair value procedures.
19
Notes to Financial Statements (continued)
U.S. GAAP defines fair value as the price that a Fund 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 also 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. 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 Fund. Unobservable inputs reflect the Funds own assumptions about the assumptions that market
participants would use in pricing the asset or liability developed 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 inputs are quoted prices in active markets for identical investments (e.g., equity securities, open-end investment
companies, futures contracts, options contracts)
Level 2 other observable inputs (including, but not limited to:
quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or
liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market corroborated inputs) (e.g., debt securities, government securities, swap contracts, foreign currency
exchange contracts, foreign securities utilizing international fair value pricing, broker-quoted securities, fair valued securities with observable inputs)
Level 3 inputs are significant unobservable inputs (including the Funds own assumptions used to determine the fair value of investments) (e.g., fair valued securities with unobservable
inputs)
Changes in inputs or methodologies used for valuing investments may result in a transfer in or out of levels within
the fair value hierarchy. Transfers between different levels in the fair value hierarchy are deemed to have occurred as of the beginning of the reporting period. The inputs or methodologies used for valuing investments are not necessarily an
indication of the risk associated with investing in those investments.
Security transactions are accounted for as of trade date. Realized gains and losses on securities sold are determined on the basis of identified cost.
c. |
Investment Income and Expenses |
Dividend income is recorded on the ex-dividend date. Dividend income on foreign securities is recorded net of any withholding tax. Interest income, which includes amortization of premium and accretion of
discount on debt securities, is accrued as earned. Non-cash dividends included in dividend income, if any, are reported at the fair market value of the securities received. Other income and expenses are recorded on an accrual basis. Expenses that
cannot be
directly attributed to a Fund are apportioned among the Funds in the Trust and in some cases other affiliated funds based upon their relative average net assets or number of shareholders.
The Fund has a balance credit arrangement with The Bank of New York Mellon (BNYM), the Funds
custodian, whereby the Fund is credited with an interest factor equal to 0.75% below the effective 90-day T-Bill rate for account balances left uninvested overnight. If the T-Bill rate falls below 0.75%, no credits will be earned. These credits
serve to reduce custody expenses that would otherwise be charged to the Fund. For the six months ended June 30, 2012, the custodian expense was not reduced.
Overdrafts will cause a reduction of any earnings credits, computed at 2% above the effective Federal funds rate on the day of the over-draft. For the six months ended June 30, 2012, the Fund did not
have any overdraft fees.
The Fund also has a balance credit arrangement with its Transfer Agent, BNY Mellon Investment
Servicing (US) Inc., whereby earnings credits are used to offset banking charges and other out-of-pocket expenses. For the six months ended June 30, 2012, the transfer agent expense was reduced by $4.
Total returns and net investment income for the Fund would have been lower had certain expenses not been offset. Total expenses before
offsets exclude the impact of expense reimbursements or fee waivers and expense reductions such as brokerage recapture credits, but include non-reimbursable expenses, if any, such as interest and taxes.
d. |
Dividends and Distributions |
Dividends resulting from net investment income and distributions of capital gains, if any, normally will be declared and paid annually in December and when required for Federal excise tax purposes. Income
and capital gain distributions are determined in accordance with Federal income tax regulations, which may differ from U.S. GAAP. These differences are primarily due to differing treatments for losses deferred due to wash sales, equalization
accounting for tax purposes, foreign currency, futures and market discount transactions. Permanent book and tax basis differences, if any, relating to shareholder distributions will result in reclassifications to paid-in capital.
The Fund intends to comply with the requirements under Subchapter M of the Internal Revenue Code of 1986, as amended, to distribute
substantially all of its taxable income and gains to its shareholders and to meet certain diversification and income requirements with respect to investment companies. Therefore, no provision for Federal income or excise tax is included in the
accompanying financial statements.
Additionally, based on the Funds understanding of the tax rules and rates related
to income, gains and transactions for the foreign jurisdictions in which it invests, the Fund will provide for foreign taxes, and where appropriate, deferred foreign taxes.
Management has analyzed the Funds tax positions taken on federal income tax returns for all open tax years (tax years ended December 31, 2008-2011), and has concluded that no provision for
federal income tax is required in the Funds financial statements.
Notes to Financial Statements (continued)
Additionally, the Fund is not aware of any tax position for which it is reasonably
possible that the total amounts of unrecognized tax benefits will change materially in the next twelve months.
Under the
Regulated Investment Company Modernization Act of 2010 (the Act), post-enactment capital losses may be carried forward for an unlimited time period. However, any new losses incurred will be required to be utilized prior to any loss
carryovers incurred in pre-enactment taxable years, which generally expire eight years following the close of the taxable year in which they were incurred. As a result of this ordering rule, pre-enactment capital loss carryovers may be more likely
to expire unused. Additionally, post-enactment capital losses that are carried forward retain their tax character as either short-term or long-term capital losses rather than being considered all short-term as under previous law.
f. |
Capital Loss Carryover and Deferrals |
As of June 30, 2012, the Fund had accumulated net realized capital loss carryovers from security transactions for Federal income tax purposes as shown in the following chart. These amounts may be
used to offset future realized capital gains, if any, through the expiration dates listed, or in the case of post-enactment losses, for an unlimited time period.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital Loss Carryover Amounts |
|
|
Expires |
|
|
|
Short-Term |
|
|
Long-Term |
|
|
December 31, |
|
(Pre-Enactment) |
|
$ |
450,209 |
|
|
|
|
|
|
|
2016 |
|
(Pre-Enactment) |
|
|
2,196,208 |
|
|
|
|
|
|
|
2017 |
|
(Pre-Enactment) |
|
|
1,033,512 |
|
|
|
|
|
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Totals |
|
$ |
3,679,929 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Trusts Declaration of Trust authorizes for each series the issuance of an unlimited number of shares of beneficial interest,
without par value. The Fund records sales and repurchases of its capital stock on the trade date. The cost of securities contributed to the Fund in connection with the issuance of shares is based on the valuation of those securities in accordance
with the Funds policy on investment valuation. Dividends and distributions to shareholders are recorded on the ex-dividend date.
At June 30, 2012, certain unaffiliated shareholders of record, specifically omnibus accounts, individually or collectively held greater than 10% of the outstanding shares of the Fund as follows: one
collectively owns 23%. Transactions by this shareholder may have a material impact on the Fund.
h. |
Foreign Currency Translation |
The books and records of the Fund are maintained in U.S. dollars. The values of investments, assets and liabilities denominated in currencies other than U.S. dollars are translated into U.S. dollars based
upon current foreign exchange rates. Purchases and sales of foreign investments, income and expenses are converted into U.S. dollars based on currency exchange rates prevailing on the respective dates of such transactions. Net realized and
unrealized gain (loss) on foreign currency transactions represent: (1) foreign exchange gains and losses from the sale and holdings of foreign currencies; (2) gains and losses between trade date and settlement
date on investment securities transactions and forward foreign currency exchange contracts; and (3) gains and losses from the difference between amounts of interest and dividends recorded
and the amounts actually received.
The Fund does not isolate the net realized and unrealized gain or loss resulting from
changes in exchange rates from the fluctuations in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments.
The Fund invests in securities of foreign entities and in instruments denominated in foreign currencies which involve risks not typically associated with investments in domestic securities. Non-domestic
securities carry special risks, such as exposure to currency fluctuations, less developed or less efficient trading markets, political instability, a lack of company information, differing auditing and legal standards, and, potentially, less
liquidity.
Realized gains in certain countries may be subject to foreign taxes at the Fund level, at rates ranging from
approximately 10% to 15%. The Fund would pay such foreign taxes at the appropriate rate for each jurisdiction.
2. |
Agreements and Transactions with Affiliates |
The Trust has entered into an Investment Management Agreement under which the Investment Manager, a subsidiary of Affiliated Managers Group, Inc. (AMG), serves as investment manager to the
Fund and is responsible for the Funds overall administration. The Investment Manager selects subadvisors for the Fund (subject to Board approval) and monitors the subadvisors investment performance, security holdings and investment
strategies. The Funds investment portfolio is managed by one or more portfolio managers who serve pursuant to a subadvisory agreement with the Investment Manager.
Investment management fees are paid directly by the Fund to the Investment Manager based on average daily net assets. For the six months ended June 30, 2012, the annual investment management fee
rate, as a percentage of average daily net assets, was 0.70%.
The Investment Manager has contractually agreed, through at
least May 1, 2013, to waive fees and pay or reimburse Fund expenses in order to limit total annual Fund operating expenses after fee waiver and expense reimbursements (exclusive of taxes, interest (including interest incurred in connection with
bank and custody overdrafts), brokerage commissions and other transaction costs, acquired fund fees and expenses and extraordinary expenses) to 1.10% of the Funds average daily net assets.
The Fund is obligated to repay the Investment Manager such amounts waived, paid or reimbursed in future years provided that the
repayment occurs within thirty-six (36) months after the waiver or reimbursement and that such repayment would not cause the Funds total operating expenses in any such future year to exceed the Funds expense cap.
Notes to Financial Statements (continued)
For the six months ended June 30, 2012, the Funds components of reimbursement
available are detailed in the following chart:
|
|
|
|
|
Reimbursement Available - 12/31/11 |
|
$ |
211,934 |
|
Additional Reimbursements |
|
|
40,223 |
|
Repayments |
|
|
|
|
Expired Reimbursements |
|
|
(29,084 |
) |
|
|
|
|
|
Reimbursement Available - 6/30/12 |
|
$ |
223,073 |
|
|
|
|
|
|
The Fund has entered into an Administration and Shareholder Servicing Agreement under which the
Investment Manager serves as the Funds administrator (the Administrator) and is responsible for all aspects of managing the Funds operations, including administration and shareholder services to the Fund, its shareholders,
and certain institutions, such as bank trust departments, broker dealers and registered investment advisers, that advise or act as an intermediary with the Funds shareholders. The Fund pays a fee to the Administrator at the rate of
0.20% per annum of the Funds average daily net assets for this service.
The aggregate annual retainer paid to
each Independent Trustee of the Board is $80,000, plus $5,000 or $2,500 for each regular or special meeting attended, respectively. The Independent Chairman of the Trust receives an additional payment of $20,000 per year. The Chairman of the Audit
Committee receives an additional payment of $8,000 per year. The Trustees fees and expenses are allocated among all of the funds for which the Investment Manager serves as the advisor (the Managers Funds) based on the relative net
assets of such funds. The Trustees fees and expenses shown in the financial statements represents the Funds allocated portion of the total fees and expenses paid by the Managers Funds.
The Fund is distributed by Managers Distributors, Inc. (the Distributor or MDI), a wholly-owned subsidiary of
the Investment Manager. MDI serves as the distributor and underwriter for the Fund and is a registered broker-dealer and member of the Financial Industry Regulatory Authority, Inc. (FINRA). Shares of the Fund will be continuously offered
and will be sold directly to prospective purchasers through brokers, dealers or other financial intermediaries who have executed selling agreements with MDI. Subject to the compensation arrangement discussed below, generally MDI bears all or a
portion of the expenses of providing services pursuant to the distribution agreement, including the payment of the expenses relating to the distribution of prospectuses for sales purposes and any advertising or sales literature. Certain Trustees and
Officers of the Fund are Officers and/or Directors of the Investment Manager, AMG and/or the Distributor.
The Securities and
Exchange Commission granted an exemptive order that permits the Fund to lend and borrow money for certain temporary purposes directly to and from other eligible Managers Funds. Participation in this interfund lending program is voluntary for both
borrowing and lending funds, and an interfund loan is only made if it benefits each participating fund. The Investment Manager administers the program according to procedures approved by the Board, and the Board monitors the operation of the
program. An interfund loan must comply with certain conditions set out in the exemptive order, which are designed to assure fairness and protect
all participating funds. For the six months ended June 30, 2012, the Fund lent to other Managers Funds varying amounts up to $1,032,942, for 5 days earning interest of $125. The interest
earned is included in the Statement of Operations as interest income. For the same period, the Fund did not borrow from any other Managers Funds.
3. |
Purchases and Sales of Securities |
Purchases and sales of securities (excluding short-term securities and U.S. Government obligations) for the six months ended June 30, 2012, were $12,034,357 and $8,411,985, respectively. Purchases
and sales of U.S. Government obligations for the six months ended June 30, 2012, were $3,451,092 and $708,470, respectively.
4. |
Portfolio Securities Loaned |
The Fund participates in a securities lending program offered by BNYM (the Program), providing for the lending of securities to qualified brokers. Securities lending income include earnings of
such temporary cash investments, plus or minus any rebate to a borrower. These earnings (after any rebate) are then divided between BNYM, as a fee for its services under the program, and the Fund, according to agreed-upon rates. Collateral on all
securities loaned is accepted in cash and/or government securities and is maintained at a minimum level of 102% (105% in the case of certain foreign securities) of the market value, plus interest, if applicable, of investments on loan. It is the
Funds policy to obtain additional collateral from or return excess collateral to the borrower by the end of the next business day, following the valuation date of the securities loaned. Therefore, the value of the collateral held may be
temporarily less than the value of the securities on loan. Lending securities entails a risk of loss to the Fund if and to the extent that the market value of the securities loaned were to increase and the borrower did not increase the collateral
accordingly, and the borrower fails to return the securities. Under the terms of the Program, the Fund is indemnified for such losses by BNYM. The Fund bears the risk of any deficiency in the amount of the collateral available for return to the
borrower due to any loss on the collateral invested. Collateral received in the form of cash is invested temporarily in the BNY Mellon Overnight Government Fund, formerly BNY Institutional Cash Reserves Fund (the ICRF), or other
short-term investments as defined in the Securities Lending Agreement with BNYM.
Effective August 2, 2010, the Trust,
on behalf of the Fund, entered into an agreement with BNYM and the Bank of New York Mellon Corporation (BNYMC) with respect to the Funds position in ICRF, pursuant to which (i) BNYMC would support the value of certain
defaulted securities issued by Lehman Brothers Holdings, Inc. (the Lehman Securities) and held by Series B of the ICRF, and (ii) once certain conditions were met, BNYMC would purchase the defaulted securities from the Fund. On
October 17, 2011, after certifying that the Fund had met all necessary conditions, BNYMC purchased the Lehman Securities from the Fund at a predetermined price, which represented a premium over the fair market value of the Lehman Securities at
that date.
5. |
Commitments and Contingencies |
In the normal course of business, the Fund may enter into contracts and agreements that contain a variety of representations and
Notes to Financial Statements (continued)
warranties, which provide general indemnifications. The maximum exposure to the Fund
under these arrangements is unknown, as this would involve future claims that may be made against the Fund that have not yet occurred. However, the Fund has had no prior claims or losses and expects the risk of material loss to be remote.
Certain transactions, such as futures and forward transactions, dollar roll agreements, or purchases of when-issued or delayed delivery securities may have a similar effect on the Funds net asset
value as if the Fund had created a degree of leverage in its portfolio. However, if the Fund enters into such a transaction, the Fund will establish a segregated account with its custodian in which it will maintain cash, U.S. government securities
or other liquid securities equal in value to its obligations in respect to such transaction. Securities and other assets held in the segregated account may not be sold while the transaction is outstanding, unless other suitable assets are
substituted.
7. |
Derivative Instruments |
The following disclosures contain information on how and why the Fund uses derivative instruments, the credit risk and how derivative instruments affect the Funds financial position, results of
operations and cash flows. The location and fair value amounts of these instruments on the Statement of Assets and Liabilities and the realized and changes in unrealized gains and losses on the Statement of Operations, each categorized by type of
derivative contract, are included in a table in the Schedule of Portfolio Investments. The derivative instruments outstanding as of the fiscal year end as disclosed in the Statement of Assets and Liabilities and the realized and unrealized changes
in gains and losses on derivative instruments during the six months as disclosed in the Statement of Operations serve as indicators of the volume of derivative activity for the Fund.
8. |
Forward Foreign Currency Contracts |
During the six months ended June 30, 2012, the Fund invested in forward foreign currency contracts to facilitate transactions in foreign securities and to hedge against foreign currency exchange rate
risk on its non-U.S. dollar denominated investment securities.
A forward foreign currency contract is an agreement between a
fund and another party to buy or sell a currency at a set price at a future date. The market value of the contract will fluctuate with changes in currency exchange rates. The contract is marked-to-market daily, and the change in market value is
recorded as an unrealized gain or loss. Gain or loss on the purchase or sale of contracts having the same settlement date, amount and counterparty is realized on the date of offset, otherwise gain or loss is realized on the settlement date.
Risks may arise upon entering into these contracts from the potential inability of counterparties to meet the terms of their
contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar.
The Fund entered into futures contracts to achieve a desired level of investment, whether to accommodate portfolio turnover or cash
flows
from capital shares transactions. There are certain risks associated with futures contracts. Prices may not move as expected or the Fund may not be able to close out the contract when it desires
to do so, resulting in losses.
On entering into a futures contract, either cash or securities in an amount equal to a
certain percentage of the contract value (initial margin) must be deposited with the futures broker. Subsequent payments (variation margin) are made or received each day. The variation margin payments equal the daily changes in the contract value
and are recorded as unrealized gains or losses. The Fund recognizes a realized gain or loss when the contract is closed or expires equal to the difference between the value of the contract at the time it was opened and the value at the time it was
closed. Futures are valued at their quoted daily settlement prices. The aggregate principal amounts of the contracts are not recorded in the financial statements. Fluctuations in the value of the contracts are recorded in the Statement of Assets and
Liabilities as an asset (liability) and in the Statement of Operations as unrealized appreciation (depreciation) until the contracts are closed, when they are recorded as realized gains (losses) on futures contracts.
10. |
New Accounting Pronouncements |
In December 2011, the FASB issued ASU No. 2011-11 Disclosures about Offsetting Assets and Liabilities. ASU 2011-11 requires disclosures to make financial statements that are prepared
under U.S. GAAP more comparable to those prepared under IFRS. The new disclosure requirements mandate that entities disclose both gross and net information about instruments and transactions eligible for offset in the statement of assets and
liabilities as well as instruments and transactions subject to an agreement similar to a master netting arrangement. In addition, ASU 2011-11 requires disclosure of collateral received and posted in connection with master netting agreements or
similar arrangements. New disclosures are required for annual reporting periods beginning on or after January 1, 2013, and interim periods within those annual periods. Management is evaluating the impact of ASU 2011-11 on the Funds
financial statements and disclosures.
At a meeting held on June 21-22, 2012, the Trusts Board of Trustees approved a new contractual expense limitation with
respect to the Fund. Effective July 1, 2012, Managers Investment Group LLC has contractually agreed until at least May 1, 2014, to limit the Funds total annual operating expenses (exclusive of taxes interest (including interest
incurred in connection with bank and custody overdrafts), brokerage commissions and other transaction costs, acquired fund fees and expenses, and extraordinary expenses) to 0.99% of average daily net assets of the Fund. Immediately prior to
July 1, 2012, the Fund had a contractual expense limitation of 1.10%.
The Fund has determined that no additional
material events or transactions occurred through the issuance of the Funds financial statements, which require additional disclosure in the Funds financial statements.
Annual Renewal of Investment Advisory Agreement or Agreements (unaudited)
On June 21-22, 2012, the Board of Trustees, including a majority of the Trustees who
are not interested persons of the Trust (the Independent Trustees), approved the Investment Management Agreement with the Investment Manager for the Managers Global Income Opportunity Fund formerly, Managers Global Bond Fund,
(the Fund) and the Subadvisory Agreement for the Subadvisor of the Fund. The Independent Trustees were separately represented by independent counsel in connection with their consideration of the approval of these agreements. In
considering the Investment Management and Subadvisory Agreements, the Trustees reviewed a variety of materials relating to the Fund, the Investment Manager and the Subadvisor, including comparative performance, fee and expense information for an
appropriate peer group of similar mutual funds (the Peer Group), performance information for the relevant benchmark index (the Fund Benchmark) and, with respect to the Subadvisor, comparative performance information for an
appropriate peer group of managed accounts, and, as to all other matters, other information provided to them on a periodic basis throughout the year, as well as information provided in connection with the meetings of June 21-22, 2012, regarding
the nature, extent and quality of services provided by the Investment Manager and the Subadvisor under their respective agreements. Prior to voting, the Independent Trustees: (a) reviewed the foregoing information with their independent legal
counsel and with management; (b) received materials from their independent legal counsel discussing the legal standards applicable to their consideration of the Investment Management Agreement and the Subadvisory Agreement; and (c) met
with their independent legal counsel in private sessions at which no representatives of management were present.
Nature, extent, and
quality of services.
In considering the nature, extent and quality of the services provided by the Investment
Manager, the Trustees reviewed information relating to the Investment Managers operations and personnel. Among other things, the Investment Manager provided financial information, biographical information on its supervisory and professional
staff and descriptions of its organizational and management structure. The Trustees also took into account information provided periodically throughout the previous year by the Investment Manager relating to the performance of its duties with
respect to the Fund and the Trustees knowledge of the Investment Managers management and the quality of the performance of its duties through Board meetings, discussions and reports. In the course of their deliberations regarding the
Investment Management Agreement, the Trustees evaluated, among other things: (a) the extent and quality of the Investment Managers oversight of the operation and management of the Fund; (b) the quality of the search, selection and
monitoring services performed by the Investment Manager in overseeing the portfolio management responsibilities of the Subadvisor; (c) the Investment Managers ability to supervise the Funds other service providers; and (d) the
Investment Managers compliance program. The Trustees also took into account the financial condition of the
Investment Manager with respect to its ability to provide the services required under the Investment Management Agreement and to maintain a contractual expense limitation for the Fund. The
Trustees also considered the Investment Managers risk management processes.
The Trustees also reviewed information
relating to the Subadvisors operations and personnel and the investment philosophy, strategies and techniques (the Investment Strategy) used in managing the Fund. Among other things, the Trustees reviewed biographical information
on portfolio management and other professional staff, information regarding the Subadvisors organizational and management structure and the Subadvisors brokerage policies and practices. The Trustees considered specific information
provided regarding the experience of the individual or individuals at the Subadvisor with portfolio management responsibility for the Fund, including the information set forth in the Funds prospectus and statement of additional information. In
the course of their deliberations, the Trustees evaluated, among other things: (a) the services rendered by the Subadvisor in the past; (b) the qualifications and experience of the Subadvisors personnel; and (c) the
Subadvisors compliance program. The Trustees also took into account the financial condition of the Subadvisor with respect to its ability to provide the services required under the Subadvisory Agreement. The Trustees also considered the
Subadvisors risk management processes.
Performance.
Among other information relating to the Funds performance, the Trustees noted that the Funds performance for the 1-year,
3-year, 5-year and 10-year periods ended March 31, 2012 was above the median performance of the Peer Group and above the performance of the Fund Benchmark, the Barclays Global Aggregate Bond Index. The Trustees noted changes to the Fund that
took effect on February 1, 2012 and took into account managements discussion of the Funds more recent performance. The Trustees concluded that the Funds performance has been satisfactory.
As noted above, the Board considered the Funds net performance during relevant time periods as compared to the Funds Peer
Group and Fund Benchmark and considered the Subadvisors performance as compared to an appropriate peer group of managed accounts and also considered the gross performance of the Fund as compared to the Subadvisors relevant performance
composite that utilizes the same investment strategy and approach and noted that the Board reviews on a quarterly basis detailed information about the Funds performance results, portfolio composition and Investment Strategies. The Board noted
the Investment Managers expertise and resources in monitoring the performance, investment style and risk-adjusted performance of the Subadvisor. The Board also noted the Subadvisors performance record with respect to the Fund. The Board
was mindful of the Investment Managers attention to monitoring the Subadvisors performance with respect to the Fund and its discussions with management regarding the factors that contributed to the performance of the Fund.
Annual Renewal of Investment Advisory Agreement or Agreements (continued)
Advisory and Subadvisory Fees and Profitability.
In considering the reasonableness of the advisory fee charged by the Investment Manager for managing the Fund, the Trustees noted that
the Investment Manager, and not the Fund, is responsible for paying the fees charged by the Funds Subadvisor and, therefore, that the fees paid to the Investment Manager cover the cost of providing portfolio management services as well as the
cost of providing search, selection and monitoring services in operating a manager-of-managers complex of mutual funds. The Trustees concluded that, in light of the additional high quality supervisory services provided by the Investment
Manager and the fact that the subadvisory fees are paid out of the advisory fee, the advisory fee payable by the Fund to the Investment Manager can reasonably be expected to exceed the median advisory fee for the Peer Group, which consists of many
funds that do not operate with a manager-of-managers structure. In this regard, the Trustees also noted that the Investment Manager has undertaken to maintain an expense limitation for the Fund.
In considering the reasonableness of the advisory fee payable to the Investment Manager, the Trustees also reviewed information provided
by the Investment Manager setting forth all revenues and other benefits, both direct and indirect (including any so-called fallout benefits such as reputational value derived from the Investment Manager serving as Investment Manager to
the Fund), received by the Investment Manager and its affiliates attributable to managing the Fund and all the mutual funds in the Managers Family of Funds, the cost of providing such services and the resulting profitability to the Investment
Manager and its affiliates from these relationships. The Trustees also noted the current and potential asset levels of the Fund and the willingness of the Investment Manager to waive fees and pay expenses for the Fund from time to time as a means of
limiting total expenses. The Trustees also considered managements discussion of the current asset level of the Fund, including the effect on assets attributable to the economic and market conditions since 2008, and considered the impact on
profitability of the current asset level and any future growth of assets of the Fund. The Board took into account managements discussion of the current advisory fee structure. In this regard, the Trustees noted that, unlike a mutual fund that
is managed by a single investment adviser, the Fund operates in a manager-of-managers structure. Based on the foregoing, the Trustees concluded that the profitability to the Investment Manager is reasonable and that the Investment Manager is not
realizing material benefits from economies of scale that would warrant adjustments to the advisory fees for the Fund at this time. With respect to economies of scale, the Trustees also noted that as the Funds assets increase over time, the
Fund may realize other economies of scale to the extent that the increase in assets is proportionally greater than the increase in certain other expenses.
In considering the reasonableness of the fee payable by the Investment Manager to the
Subadvisor, the Trustees relied on the ability of the Investment Manager to negotiate the terms of the Subadvisory Agreement at arms length as part of the manager-of-managers structure, noting that the Subadvisor is not affiliated with the
Investment Manager. In addition, the Trustees considered other potential benefits of the subadvisory relationship to the Subadvisor, including, among others, the indirect benefits that the Subadvisor may receive from the Subadvisors
relationship with the Fund, including any so-called fallout benefits to the Subadvisor, such as reputational value derived from the Subadvisor serving as Subadvisor to the Fund. In addition, the Trustees noted that the subadvisory fees
are paid by the Investment Manager out of its advisory fee. As a consequence, the cost of services to be provided by the Subadvisor and the profitability to the Subadvisor of its relationship with the Fund were not material factors in the
Trustees deliberations. For similar reasons, the Trustees did not consider potential economies of scale in the management of the Fund by the Subadvisor to be a material factor in their deliberations at this time.
The Trustees noted that the Funds advisory fees (which include both the advisory and administration fee) and total expenses (net
of applicable expense waivers/reimbursements) as of March 31, 2012 were both higher than the average for the Peer Group. The Trustees took into account the fact that the Investment Manager has contractually agreed to lower the Funds
contractual expense limitation from 1.10% to 0.99% of the Funds net annual operating expenses (subject to certain excluded expenses) effective July 1, 2012 through at least May 1, 2014. The Board took into account managements
discussion of the Funds expenses and the current size of the Fund. The Trustees concluded that, in light of the nature, extent and quality of the services provided by the Investment Manager and the Subadvisor, the Funds performance, the
foregoing expense limitation and the considerations noted above with respect to the Subadvisor and the Investment Manager, the Funds advisory fees, including subadvisory fees, are reasonable.
* * * *
After consideration of the foregoing, the Trustees also reached the following conclusions (in addition to the conclusions discussed
above) regarding the Investment Management Agreement and the Subadvisory Agreement: (a) the Investment Manager and the Subadvisor have demonstrated that they possess the capability and resources to perform the duties required of them under the
Investment Management Agreement and the Subadvisory Agreement; (b) the Subadvisors Investment Strategy is appropriate for pursuing the Funds investment objectives; and (c) the Investment Manager and the Subadvisor maintain
appropriate compliance programs.
Annual Renewal of Investment Advisory Agreement or Agreements (continued)
Based on all of the above-mentioned factors and related conclusions, with no single
factor or conclusion being determinative and with each Trustee not necessarily attributing the same weight to each factor, the Trustees concluded that approval of the Investment Management Agreement and the Subadvisory Agreement would be in the best
interests of the Fund and its
shareholders. Accordingly, on June 21-22, 2012, the Trustees, including a majority of the Independent Trustees, voted to approve the Investment Management Agreement and the Subadvisory
Agreement for the Fund.
Investment Manager and Administrator
Managers Investment Group LLC
800 Connecticut
Avenue
Norwalk, CT 06854
(800)
835-3879
Distributor
Managers Distributors, Inc.
800 Connecticut
Avenue
Norwalk, CT 08654
(800)
835-3879
Custodian
The Bank
of New York Mellon
2 Hanson Place
Brooklyn, NY 11217
Legal Counsel
Ropes & Gray LLP
Prudential Tower, 800 Boylston Street
Boston,
MA 02199-3600
Transfer Agent
BNY Mellon Investment Servicing (US) Inc.
Attn:
Managers
P.O. Box 9769
Providence,
RI 02940
(800) 548-4539
For ManagersChoice Only
Managers
c/o BNY Mellon Investment Servicing
(US) Inc.
P.O. Box 9847
Providence,
RI 02940-8047
(800) 358-7668
Trustees
Jack W. Aber
Bruce B. Bingham
Christine C. Carsman
William E. Chapman, II
Edward J.
Kaier
Steven J. Paggioli
Eric
Rakowski
Thomas R. Schneeweis
MANAGERS AND MANAGERS AMG
FUNDS
|
|
|
|
|
EQUITY
FUNDS |
|
BALANCED
FUNDS |
CADENCE CAPITAL
APPRECIATION CADENCE FOCUSED GROWTH
CADENCE MID-CAP CADENCE EMERGING COMPANIES Cadence Capital
Management, LLC CHICAGO EQUITY
PARTNERS MID-CAP Chicago Equity Partners, LLC
ESSEX SMALL/MICRO CAP
GROWTH Essex Investment Management Co., LLC
FQ TAX-MANAGED U.S. EQUITY FQ U.S. EQUITY First Quadrant, L.P.
FRONTIER SMALL CAP
GROWTH Frontier Capital Management Company, LLC
GW&K SMALL CAP
EQUITY Gannett Welsh & Kotler, LLC
MICRO-CAP
Lord, Abbett & Co. LLC WEDGE Capital
Management L.L.P. Next Century Growth Investors LLC RBC Global Asset Management (U.S.) Inc. REAL ESTATE SECURITIES Urdang Securities
Management, Inc. |
|
RENAISSANCE LARGE
CAP GROWTH Renaissance Group LLC
SKYLINE SPECIAL
EQUITIES PORTFOLIO Skyline Asset Management, L.P.
SPECIAL EQUITY Ranger Investment Management, L.P. Lord, Abbett & Co. LLC
Smith Asset Management Group, L.P. Federated
MDTA LLC SYSTEMATIC VALUE
SYSTEMATIC MID CAP VALUE Systematic Financial Management, L.P. TIMESSQUARE MID CAP GROWTH TIMESSQUARE SMALL CAP GROWTH TSCM GROWTH EQUITY TimesSquare Capital Management,
LLC TRILOGY GLOBAL
EQUITY TRILOGY EMERGING MARKETS EQUITY
TRILOGY INTERNATIONAL SMALL CAP Trilogy Global Advisors, L.P.
YACKTMAN FUND
YACKTMAN FOCUSED FUND Yacktman Asset Management L.P. |
|
CHICAGO EQUITY
PARTNERS BALANCED Chicago Equity Partners, LLC
ALTERNATIVE
FUNDS FQ GLOBAL
ALTERNATIVES FQ GLOBAL ESSENTIALS
First Quadrant, L.P.
INCOME FUNDS
BOND (MANAGERS)
FIXED INCOME
GLOBAL INCOME OPPORTUNITY Loomis, Sayles & Co., L.P.
BOND (MANAGERS PIMCO) Pacific Investment Management Co. LLC CALIFORNIA INTERMEDIATE TAX-FREE
Miller Tabak Asset Management LLC
GW&K MUNICIPAL BOND GW&K MUNICIPAL ENHANCED YIELD Gannett
Welsh & Kotler, LLC HIGH
YIELD J.P. Morgan Investment Management LLC
INTERMEDIATE DURATION GOVERNMENT SHORT DURATION GOVERNMENT Smith Breeden
Associates, Inc. |
|
|
|
|
|
This report is prepared for the Funds shareholders. It is authorized for distribution to
prospective investors only when preceded or accompanied by an effective prospectus. To receive a free copy of the prospectus or Statement of Additional Information, which includes additional information about Fund Trustees, please contact us by
calling 800.835.3879. Distributed by Managers Distributors, Inc., member FINRA. A description of the policies and procedures each Fund uses to vote its proxies is available: (i) without charge, upon request, by calling 800.835.3879, or (ii) on the Securities and Exchange
Commissions (SEC) Web site at www.sec.gov. For information regarding each Funds proxy voting record for the 12-month period ended June 30, call 800.835.3879 or visit the SEC Web site at www.sec.gov.
The Funds file their complete schedule of portfolio holdings
with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Funds Forms N-Q are available on the SECs website at www.sec.gov. A Funds Forms N-Q may be reviewed and copied at the SECs Public Reference
Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 800.SEC.0330. To review a complete list of the Funds portfolio holdings, or to view the most recent quarterly holdings report,
semiannual report, or annual report, please visit www.managersinvest.com. |
|
|
www.managersinvest.com
|
|
|
|
|
|
|
|
|
|
Not applicable for the
semi-annual shareholder report.
Item 3. |
AUDIT COMMITTEE FINANCIAL EXPERT |
Not
applicable for the semi-annual shareholder report.
Item 4. |
PRINCIPAL ACCOUNTANT FEES AND SERVICES |
Not applicable for the semi-annual shareholder report.
Item 5. |
AUDIT COMMITTEE OF LISTED REGISTRANTS |
Not applicable.
Item 6. |
SCHEDULE OF INVESTMENTS |
The schedule of
investments in unaffiliated issuers as of the close of the reporting period is included as part of the shareholder report contained in Item 1 hereof.
Item 7. |
DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES |
Not applicable.
Item 8. |
PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES |
Not applicable.
Item 9. |
PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANIES AND AFFILIATED PURCHASERS |
Not applicable.
Item 10. |
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS |
Not applicable.
Item 11. |
CONTROLS AND PROCEDURES |
|
(a) |
The registrants principal executive and principal financial officers have concluded, based on their evaluation of the registrants disclosure controls and
procedures as of a date within 90 days of the filing date of this report, that the registrants disclosure controls and procedures are reasonably designed to ensure that information required to be disclosed by the registrant on Form N-CSR is
recorded, processed, summarized and reported within the required time periods and that information required to be disclosed by the registrant in the reports that it files or submits on Form N-CSR is accumulated and communicated to the
registrants management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. |
|
(b) |
There were no changes in the registrants internal control over financial reporting during the registrants second fiscal quarter of the period covered by
this report that have materially affected, or are reasonably likely to materially affect, the internal control over financial reporting. |
|
|
|
(a) (1) |
|
Not applicable. |
|
|
(a) (2) |
|
Certifications pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 - Filed herewith. |
|
|
(a) (3) |
|
Not applicable. |
|
|
(b) |
|
Certifications pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 - Filed herewith. |
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.
|
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THE MANAGERS FUNDS |
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By: |
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/s/ Keitha L. Kinne |
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Keitha L. Kinne, President |
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Date: |
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September 4, 2012 |
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.
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By: |
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/s/ Keitha L. Kinne |
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Keitha L. Kinne, President |
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Date: |
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September 4, 2012 |
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By: |
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/s/ Donald S. Rumery |
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Donald S. Rumery, Chief Financial Officer |
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Date: |
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September 4, 2012 |