0000875732-17-000020.txt : 20170706 0000875732-17-000020.hdr.sgml : 20170706 20170706122852 ACCESSION NUMBER: 0000875732-17-000020 CONFORMED SUBMISSION TYPE: N-CSRS PUBLIC DOCUMENT COUNT: 7 CONFORMED PERIOD OF REPORT: 20170430 FILED AS OF DATE: 20170706 DATE AS OF CHANGE: 20170706 EFFECTIVENESS DATE: 20170706 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DREYFUS MIDCAP INDEX FUND INC CENTRAL INDEX KEY: 0000875732 IRS NUMBER: 133618129 STATE OF INCORPORATION: NY FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: N-CSRS SEC ACT: 1940 Act SEC FILE NUMBER: 811-06325 FILM NUMBER: 17951462 BUSINESS ADDRESS: STREET 1: 200 PARK AVENUE STREET 2: THE DREYFUS CORPORATION CITY: NEW YORK STATE: NY ZIP: 10166 BUSINESS PHONE: 2129226400 MAIL ADDRESS: STREET 1: C/O DREYFUS CORP STREET 2: 200 PARK AVENUE, 7TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10166 FORMER COMPANY: FORMER CONFORMED NAME: DREYFUS MIDCAP INDEX FUND DATE OF NAME CHANGE: 19951228 FORMER COMPANY: FORMER CONFORMED NAME: PEOPLES S&P MIDCAP INDEX FUND INC DATE OF NAME CHANGE: 19920717 0000875732 S000000078 DREYFUS MIDCAP INDEX FUND INC C000000115 Investor Shares PESPX C000172470 Class I DMIDX N-CSRS 1 lp1113.htm SEMI-ANNUAL REPORT lp1113.htm - Generated by SEC Publisher for SEC Filing

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES

Investment Company Act file number

811-06325

 

 

 

Dreyfus Midcap Index Fund, Inc.

 

 

(Exact name of Registrant as specified in charter)

 

 

 

 

 

 

c/o The Dreyfus Corporation

200 Park Avenue

New York, New York  10166

 

 

(Address of principal executive offices)        (Zip code)

 

 

 

 

 

Bennett A. MacDougall, Esq.

200 Park Avenue

New York, New York  10166

 

 

(Name and address of agent for service)

 

 

Registrant's telephone number, including area code: 

(212) 922-6400

 

 

Date of fiscal year end:

 

10/31

 

Date of reporting period:

04/30/17

 

             

 

 


 

FORM N-CSR

Item 1.       Reports to Stockholders.

 


 

Dreyfus Midcap Index Fund, Inc.

     

 

SEMIANNUAL REPORT

April 30, 2017

   
 

 

 

Save time. Save paper. View your next shareholder report online as soon as it’s available. Log into www.dreyfus.com and sign up for Dreyfus eCommunications. It’s simple and only takes a few minutes.

 

The views expressed in this report reflect those of the portfolio manager(s) only through the end of the period covered and do not necessarily represent the views of Dreyfus or any other person in the Dreyfus organization. Any such views are subject to change at any time based upon market or other conditions and Dreyfus disclaims any responsibility to update such views. These views may not be relied on as investment advice and, because investment decisions for a Dreyfus fund are based on numerous factors, may not be relied on as an indication of trading intent on behalf of any Dreyfus fund.

 

Not FDIC-Insured • Not Bank-Guaranteed • May Lose Value

 

Contents

THE FUND

FOR MORE INFORMATION

 

Back Cover

 

       
 


Dreyfus Midcap Index Fund, Inc.

 

The Fund

A LETTER FROM THE CEO OF DREYFUS

Dear Shareholder:

We are pleased to present this semiannual report for Dreyfus Midcap Index Fund, Inc., covering the six-month period from November 1, 2016 through April 30, 2017. For information about how the fund performed during the reporting period, as well as general market perspectives, we provide a Discussion of Fund Performance on the pages that follow.

Stocks advanced solidly but higher-quality bonds lost a degree of value over the reporting period amid heightened market volatility stemming from various economic and political developments. After giving back a portion of their previous gains due to uncertainty in advance of U.S. elections, equity markets rallied to a series of new highs in the wake of the election’s unexpected outcome as investors revised their expectations for U.S. fiscal, regulatory, and tax policies. Generally strong economic data and corporate earnings continued to support stock prices over the first four months of 2017. In the bond market, yields of U.S. government securities moved higher and prices fell in response to two short-term interest-rate hikes and rising longer-term rates, while lower-rated corporate-backed bonds continued to advance in anticipation of a more business-friendly market environment.

Some asset classes and industry groups seem likely to continue to benefit from a changing economic and geopolitical landscape, while others probably will face challenges as conditions evolve. Consequently, selectivity seems likely to be an important determinant of investment success in the months ahead. As always, we encourage you to discuss the implications of our observations with your financial advisor.

Thank you for your continued confidence and support.

Sincerely,

Mark D. Santero
Chief Executive Officer
The Dreyfus Corporation
May 15, 2017

2

 

DISCUSSION OF FUND PERFORMANCE

For the period from November 1, 2016 through April 30, 2017, as provided by Thomas J. Durante, CFA, Karen Q. Wong, CFA, and Richard A. Brown, CFA, Portfolio Managers

Market and Fund Performance Overview

For the six-month period ended April 30, 2017, Dreyfus Midcap Index Fund’s Class I shares produced a total return of 15.50%, and its Investor shares returned 15.37%.1 In comparison, the S&P MidCap 400® Index (the “Index”), the fund’s benchmark, produced a total return of 15.68% for the same period.2,3

Mid-cap stocks gained ground amid better-than-expected corporate earnings reports, improving domestic growth prospects, and positive investor sentiment in the wake of the U.S. presidential election. The difference in returns between the fund and the Index was primarily the result of transaction costs and operating expenses that are not reflected in the Index’s results.

As of August 31, 2016, existing fund shares were renamed Investor shares and Class I shares were added as a new share class of the fund.

The Fund’s Investment Approach

The fund seeks to match the performance of the Index by generally investing in stocks included in the Index and in futures whose performance is tied to the Index. The fund generally invests in all 400 stocks in the Index in proportion to their weighting in the Index.

The Index is an unmanaged index of 400 common stocks of medium-sized companies. S&P weights each company’s stock in the Index by its market capitalization (i.e., the share price times the number of shares outstanding), adjusted by the number of available float shares (i.e., those shares available to public investors).

Post-Election Optimism Drove Markets Higher

While political and economic uncertainties caused U.S. equity markets to move lower in the days leading up to the 2016 presidential election, the election’s widely unexpected outcome quickly reenergized investor sentiment. Stocks rose sharply in anticipation of lower corporate taxes, reduced regulatory constraints on businesses, and increased infrastructure spending. As a result, the Index climbed sharply in November and December.

Stocks continued to gain value in early 2017, with better-than-expected corporate earnings, robust labor markets, increased bank lending activity, and encouraging global economic data driving several broad market indices, including the Index, to a series of new highs through early March. While disappointing macroeconomic data and concerns about the new administration’s ability to implement its business-friendly policies slowed the pace of the market’s advance later in March and in April, the Index ended the reporting period with solid double-digit gains.

Technology and Financial Stocks Led the Market’s Advance

Mid-cap stocks generally produced higher returns than their large-cap counterparts over the reporting period, in part due to government policy proposals that are expected to benefit domestically-oriented companies more than larger companies with significant exposure to

3

 

DISCUSSION OF FUND PERFORMANCE (continued)

international markets. Results were particularly strong in the financials sector, where banks led the rally in anticipation of reduced regulatory costs, higher lending volumes, and lower corporate taxes. Midsized capital markets companies and brokerage firms benefited from rising financial markets and higher assets under management, while insurers proved able to increase premiums.

In the information technology sector, early fears regarding the potential impact of trade policy proposals eased. In addition, many technology companies reported better-than-expected quarterly earnings, and electronic equipment producers and semiconductor manufacturers participated in positive trends in card reading technology, smartphones, and other innovations. The industrials sector also produced above-average results, largely on the strength of aerospace-and-defense companies expected to benefit from increased military spending and reduced restrictions on overseas weapons sales. Machinery stocks also fared well in anticipation of greater infrastructure spending and economic growth.

Only two segments of the Index produced negative absolute returns during the reporting period. The energy sector lost a degree of value when oil and gas prices moved mildly higher in early 2017, hurting drilling contractors. Other energy-related companies struggled due to unusually high oil and gas inventories during a mild winter season. In the telecommunication services sector, which comprises a relatively small part of the overall Index, results were constrained by intensifying competitive pressures from larger telecommunications companies.

Replicating the Performance of the Index

Although we do not actively manage the fund’s investments in response to macroeconomic trends, it is worth noting that the U.S. and global economic recoveries appear to have gained momentum, and corporate earnings have continued to come in higher than many analysts expected. However, the market’s currently constructive conditions could be undermined by geopolitical instability and uncertainty surrounding the new presidential administration’s ability to enact its policy proposals into law. As always, we have continued to monitor the factors considered by the fund’s investment model in light of current market conditions.

May 15, 2017

Equities are subject generally to market, market sector, market liquidity, issuer, and investment style risks, among other factors, to varying degrees, all of which are more fully described in the fund’s prospectus.

Stocks of mid-cap companies often experience sharper price fluctuations than stocks of large-cap companies.

1  Total return includes reinvestment of dividends and any capital gains paid. Past performance is no guarantee of future results. Share price and investment return fluctuate such that upon redemption, fund shares may be worth more or less than their original cost.

2  Source: Lipper Inc. — The S&P MidCap 400® Index provides investors with a benchmark for midsized companies. The index measures the performance of midsized companies, reflecting the distinctive risk and return characteristics of this market segment. Investors cannot invest directly in any index.

3  “Standard & Poor’s®,” “S&P®,” and “S&P MidCap 400®” are registered trademarks of Standard & Poor’s Financial Services LLC, and have been licensed for use on behalf of the fund. The fund is not sponsored, endorsed, managed, advised, sold, or promoted by Standard & Poor’s and its affiliates and Standard & Poor’s and its affiliates make no representation regarding the advisability of investing in the fund.

4

 

UNDERSTANDING YOUR FUND’S EXPENSES (Unaudited)

As a mutual fund investor, you pay ongoing expenses, such as management fees and other expenses. Using the information below, you can estimate how these expenses affect your investment and compare them with the expenses of other funds. You also may pay one-time transaction expenses, including sales charges (loads) and redemption fees, which are not shown in this section and would have resulted in higher total expenses. For more information, see your fund’s prospectus or talk to your financial adviser.

Review your fund’s expenses

The table below shows the expenses you would have paid on a $1,000 investment in Dreyfus Midcap Index Fund, Inc. from November 1, 2016 to April 30, 2017. It also shows how much a $1,000 investment would be worth at the close of the period, assuming actual returns and expenses.

                   

Expenses and Value of a $1,000 Investment

assuming actual returns for the six months ended April 30, 2017

   
                 
         

Investor Shares

 

Class I

 

Expenses paid per $1,000

   

$2.67

$1.34

 

Ending value (after expenses)

   

$1,153.70

$1,155.00

 

COMPARING YOUR FUND’S EXPENSES
WITH THOSE OF OTHER FUNDS
(Unaudited)

Using the SEC’s method to compare expenses

The Securities and Exchange Commission (SEC) has established guidelines to help investors assess fund expenses. Per these guidelines, the table below shows your fund’s expenses based on a $1,000 investment, assuming a hypothetical 5% annualized return. You can use this information to compare the ongoing expenses (but not transaction expenses or total cost) of investing in the fund with those of other funds. All mutual fund shareholder reports will provide this information to help you make this comparison. Please note that you cannot use this information to estimate your actual ending account balance and expenses paid during the period.

                     

Expenses and Value of a $1,000 Investment

assuming a hypothetical 5% annualized return for the six months ended April 30,2017

                 
         

Investor Shares

 

Class I

 

Expenses paid per $1,000

   

 

$2.51

$1.25

 

Ending value (after expenses)

   

 

$1,022.32

$1,023.55

 

 Expenses are equal to the fund’s annualized expense ratio of .50% for Investor shares and .25% for Class I, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).

5

 

STATEMENT OF INVESTMENTS

April 30, 2017 (Unaudited)

           
 

Common Stocks - 98.7%

 

Shares

 

Value ($)

 

Automobiles & Components - .9%

         

Cooper Tire & Rubber Co.

 

118,300

 

4,530,890

 

Dana

 

326,736

 

6,345,213

 

Gentex

 

653,674

 

13,498,368

 

Thor Industries

 

107,563

 

10,345,409

 
       

34,719,880

 

Banks - 8.2%

         

Associated Banc-Corp

 

346,374

 

8,624,713

 

BancorpSouth

 

193,601

a

5,895,150

 

Bank of Hawaii

 

95,598

 

7,789,325

 

Bank of the Ozarks

 

206,334

 

9,794,675

 

Cathay General Bancorp

 

167,824

 

6,385,703

 

Chemical Financial

 

159,357

 

7,561,490

 

Commerce Bancshares

 

199,024

 

10,936,369

 

Cullen/Frost Bankers

 

129,187

 

12,193,961

 

East West Bancorp

 

325,884

 

17,685,725

 

F.N.B.

 

730,018

 

10,395,456

 

First Horizon National

 

532,527

 

9,771,870

 

Fulton Financial

 

390,639

 

7,207,290

 

Hancock Holding

 

192,178

 

8,974,713

 

International Bancshares

 

131,995

 

4,936,613

 

MB Financial

 

161,375

 

6,860,051

 

New York Community Bancorp

 

1,104,360

 

14,676,944

 

PacWest Bancorp

 

272,637

 

13,465,541

 

PrivateBancorp

 

181,121

 

10,463,360

 

Prosperity Bancshares

 

158,254

 

10,634,669

 

Signature Bank

 

121,331

b

16,798,277

 

SVB Financial Group

 

118,182

b

20,792,941

 

Synovus Financial

 

278,485

 

11,640,673

 

TCF Financial

 

385,870

 

6,370,714

 

Texas Capital Bancshares

 

112,883

b

8,590,396

 

Trustmark

 

155,244

 

5,157,206

 

UMB Financial

 

98,349

 

7,129,319

 

Umpqua Holdings

 

502,566

 

8,880,341

 

United Bankshares

 

218,151

 

8,704,225

 

Valley National Bancorp

 

602,760

a

7,088,458

 

Washington Federal

 

200,195

 

6,746,571

 

Webster Financial

 

209,648

 

10,652,215

 

6

 

           
 

Common Stocks - 98.7% (continued)

 

Shares

 

Value ($)

 

Banks - 8.2% (continued)

         

Wintrust Financial

 

117,495

 

8,325,696

 
       

311,130,650

 

Capital Goods - 10.6%

         

A.O. Smith

 

332,898

 

17,936,544

 

AECOM

 

353,551

b

12,094,980

 

AGCO

 

152,136

 

9,735,183

 

Carlisle Companies

 

145,974

 

14,800,304

 

Crane

 

112,808

 

9,014,487

 

Curtiss-Wright

 

100,838

 

9,424,319

 

Donaldson

 

300,410

 

13,902,975

 

Dycom Industries

 

71,798

b

7,586,177

 

EMCOR Group

 

134,424

 

8,837,034

 

EnerSys

 

97,973

 

8,142,536

 

Esterline Technologies

 

66,601

b

6,090,661

 

GATX

 

90,134

 

5,399,027

 

Graco

 

126,706

 

13,665,242

 

Granite Construction

 

90,109

 

4,749,645

 

Hubbell

 

116,612

 

13,192,316

 

Huntington Ingalls Industries

 

104,006

 

20,893,765

 

IDEX

 

172,373

 

18,057,795

 

ITT

 

201,267

 

8,479,379

 

KBR

 

320,760

 

4,506,678

 

Kennametal

 

179,842

 

7,477,830

 

KLX

 

117,246

b

5,545,736

 

Lennox International

 

87,975

 

14,550,185

 

Lincoln Electric Holdings

 

139,723

 

12,439,539

 

MSC Industrial Direct, Cl. A

 

102,212

 

9,151,040

 

Nordson

 

121,702

 

15,237,090

 

NOW

 

240,963

b

4,098,781

 

Orbital ATK

 

131,452

 

13,013,748

 

Oshkosh

 

169,842

 

11,785,336

 

Regal Beloit

 

100,462

 

7,921,429

 

Rockwell Collins

 

1

 

96

 

Teledyne Technologies

 

79,724

b

10,749,187

 

Terex

 

241,685

 

8,454,141

 

Timken

 

158,524

 

7,648,783

 

Toro

 

245,291

 

15,924,292

 

Trinity Industries

 

344,649

 

9,271,058

 

Valmont Industries

 

50,693

 

7,723,079

 

7

 

STATEMENT OF INVESTMENTS (Unaudited) (continued)

           
 

Common Stocks - 98.7% (continued)

 

Shares

 

Value ($)

 

Capital Goods - 10.6% (continued)

         

Wabtec

 

194,911

 

16,351,084

 

Watsco

 

69,192

 

9,603,850

 

Woodward

 

126,113

 

8,534,067

 
       

401,989,398

 

Commercial & Professional Services - 2.6%

         

CDK Global

 

333,393

 

21,673,879

 

Clean Harbors

 

117,080

b

6,803,519

 

Copart

 

462,279

b

14,284,421

 

Deluxe

 

109,395

 

7,866,594

 

FTI Consulting

 

95,489

b

3,302,965

 

Herman Miller

 

135,889

 

4,497,926

 

HNI

 

98,826

 

4,621,104

 

ManpowerGroup

 

152,926

 

15,442,467

 

MSA Safety

 

70,117

 

5,458,608

 

Pitney Bowes

 

417,017

 

5,542,156

 

Rollins

 

215,238

 

8,357,692

 
       

97,851,331

 

Consumer Durables & Apparel - 2.9%

         

Brunswick

 

202,525

 

11,493,294

 

CalAtlantic Group

 

162,598

a

5,889,300

 

Carter's

 

110,006

 

10,124,952

 

Deckers Outdoor

 

71,443

a,b

4,257,288

 

Helen of Troy

 

62,017

b

5,829,598

 

Kate Spade & Company

 

290,946

b

5,062,460

 

KB Home

 

186,785

 

3,847,771

 

NVR

 

7,907

b

16,693,654

 

Polaris Industries

 

133,823

 

11,409,749

 

Skechers USA, Cl. A

 

300,937

b

7,598,659

 

Tempur Sealy International

 

107,360

b

5,040,552

 

Toll Brothers

 

335,177

 

12,063,020

 

TRI Pointe Group

 

356,463

b

4,437,964

 

Tupperware Brands

 

114,545

 

8,225,476

 
       

111,973,737

 

Consumer Services - 3.6%

         

Brinker International

 

112,308

 

4,962,891

 

Buffalo Wild Wings

 

41,043

b

6,466,325

 

Cheesecake Factory

 

99,495

 

6,383,599

 

Churchill Downs

 

27,895

 

4,652,886

 

Cracker Barrel Old Country Store

 

54,835

 

8,784,019

 

8

 

           
 

Common Stocks - 98.7% (continued)

 

Shares

 

Value ($)

 

Consumer Services - 3.6% (continued)

         

DeVry Education Group

 

128,270

 

4,855,020

 

Domino's Pizza

 

108,578

 

19,694,963

 

Dunkin' Brands Group

 

209,351

 

11,694,347

 

Graham Holdings, Cl. B

 

10,566

 

6,357,562

 

International Speedway, Cl. A

 

57,499

 

2,133,213

 

Jack in the Box

 

72,470

 

7,389,766

 

Panera Bread, Cl. A

 

48,622

b

15,203,127

 

Papa John's International

 

60,150

 

4,755,459

 

Service Corporation International

 

427,645

 

13,778,722

 

Sotheby's

 

103,336

b

4,893,993

 

Texas Roadhouse

 

145,063

 

6,800,553

 

Wendy's

 

445,493

a

6,566,567

 
       

135,373,012

 

Diversified Financials - 3.3%

         

Dun & Bradstreet

 

82,853

 

9,081,517

 

Eaton Vance

 

261,331

 

11,218,940

 

FactSet Research Systems

 

89,154

 

14,555,282

 

Federated Investors, Cl. B

 

206,807

 

5,546,564

 

Janus Capital Group

 

327,031

 

4,467,243

 

Legg Mason

 

199,780

 

7,467,776

 

MarketAxess Holdings

 

85,064

 

16,376,521

 

MSCI

 

205,323

 

20,598,003

 

SEI Investments

 

302,309

 

15,330,089

 

SLM

 

976,893

b

12,250,238

 

Stifel Financial

 

152,768

b

7,465,772

 
       

124,357,945

 

Energy - 3.4%

         

CONSOL Energy

 

400,678

b

6,082,292

 

Diamond Offshore Drilling

 

145,242

b

2,094,390

 

Dril-Quip

 

84,754

b

4,369,069

 

Energen

 

220,936

b

11,486,463

 

Ensco, Cl. A

 

679,650

 

5,362,438

 

Gulfport Energy

 

355,604

b

5,646,992

 

HollyFrontier

 

403,904

 

11,365,859

 

Nabors Industries

 

650,591

 

6,727,111

 

Noble

 

548,044

 

2,630,611

 

Oceaneering International

 

222,066

 

5,860,322

 

Oil States International

 

116,985

b

3,480,304

 

Patterson-UTI Energy

 

379,084

 

8,205,273

 

9

 

STATEMENT OF INVESTMENTS (Unaudited) (continued)

           
 

Common Stocks - 98.7% (continued)

 

Shares

 

Value ($)

 

Energy - 3.4% (continued)

         

PBF Energy, Cl. A

 

212,859

 

4,751,013

 

QEP Resources

 

537,540

b

6,348,347

 

Rowan Cos., Cl. A

 

280,526

b

3,947,001

 

SM Energy

 

219,410

 

4,956,472

 

Southwestern Energy

 

1,135,002

b

8,523,865

 

Superior Energy Services

 

342,546

b

4,137,956

 

Western Refining

 

177,508

 

6,122,251

 

World Fuel Services

 

159,072

 

5,858,622

 

WPX Energy

 

896,656

b

10,697,106

 
       

128,653,757

 

Food & Staples Retailing - .6%

         

Casey's General Stores

 

88,699

 

9,940,497

 

Sprouts Farmers Market

 

301,975

b

6,737,062

 

United Natural Foods

 

114,224

b

4,743,723

 
       

21,421,282

 

Food, Beverage & Tobacco - 2.5%

         

Boston Beer, Cl. A

 

20,817

b

3,004,934

 

Dean Foods

 

201,985

 

3,987,184

 

Flowers Foods

 

412,266

 

8,084,536

 

Hain Celestial Group

 

232,667

b

8,606,352

 

Ingredion

 

163,099

 

20,194,918

 

Lamb Weston Holdings

 

313,840

 

13,102,820

 

Lancaster Colony

 

43,959

 

5,534,438

 

Post Holdings

 

146,263

b

12,313,882

 

Snyder's-Lance

 

192,308

 

6,780,780

 

Tootsie Roll Industries

 

39,636

a

1,480,405

 

TreeHouse Foods

 

129,321

a,b

11,328,520

 
       

94,418,769

 

Health Care Equipment & Services - 6.2%

         

ABIOMED

 

91,621

b

11,940,049

 

Acadia Healthcare

 

171,673

b

7,481,509

 

Align Technology

 

170,518

b

22,955,133

 

Allscripts Healthcare Solutions

 

412,363

b

4,935,985

 

Globus Medical, Cl. A

 

162,830

b

4,938,634

 

Halyard Health

 

104,535

b

4,129,133

 

HealthSouth

 

202,228

 

9,484,493

 

Hill-Rom Holdings

 

134,663

 

10,185,909

 

LifePoint Health

 

90,128

b

5,601,455

 

LivaNova

 

99,982

b

5,269,051

 

10

 

           
 

Common Stocks - 98.7% (continued)

 

Shares

 

Value ($)

 

Health Care Equipment & Services - 6.2% (continued)

         

Masimo

 

100,787

b

10,354,856

 

MEDNAX

 

212,083

b

12,801,330

 

Molina Healthcare

 

94,859

b

4,723,030

 

NuVasive

 

113,633

b

8,239,529

 

Owens & Minor

 

136,981

 

4,746,392

 

ResMed

 

320,018

 

21,758,024

 

STERIS

 

191,293

 

14,117,423

 

Teleflex

 

101,474

 

20,993,956

 

Tenet Healthcare

 

184,323

b

2,888,341

 

VCA

 

183,630

b

16,814,999

 

WellCare Health Plans

 

100,757

b

15,457,131

 

West Pharmaceutical Services

 

165,689

 

15,248,359

 
       

235,064,721

 

Household & Personal Products - .8%

         

Avon Products

 

996,306

b

4,832,084

 

Edgewell Personal Care

 

130,012

b

9,294,558

 

Energizer Holdings

 

140,353

 

8,313,108

 

Nu Skin Enterprises, Cl. A

 

112,120

 

6,192,388

 
       

28,632,138

 

Insurance - 4.9%

         

Alleghany

 

34,883

b

21,303,048

 

American Financial Group

 

165,245

 

16,079,991

 

Aspen Insurance Holdings

 

135,632

 

7,100,335

 

Brown & Brown

 

258,332

 

11,082,443

 

CNO Financial Group

 

390,756

 

8,233,229

 

Everest Re Group

 

92,378

 

23,252,466

 

First American Financial

 

250,629

 

10,879,805

 

Genworth Financial, Cl. A

 

1,115,560

b

4,506,862

 

Hanover Insurance Group

 

95,450

 

8,425,371

 

Kemper

 

111,870

 

4,402,085

 

Mercury General

 

82,492

 

5,072,433

 

Old Republic International

 

556,559

 

11,509,640

 

Primerica

 

103,526

 

8,675,479

 

Reinsurance Group of America

 

145,397

 

18,180,441

 

RenaissanceRe Holdings

 

92,180

 

13,105,231

 

W.R. Berkley

 

219,237

 

14,903,731

 
       

186,712,590

 

Materials - 7.9%

         

Allegheny Technologies

 

243,038

 

4,459,747

 

11

 

STATEMENT OF INVESTMENTS (Unaudited) (continued)

           
 

Common Stocks - 98.7% (continued)

 

Shares

 

Value ($)

 

Materials - 7.9% (continued)

         

AptarGroup

 

141,952

 

11,398,746

 

Ashland Global Holdings

 

140,627

 

17,367,434

 

Bemis

 

208,771

 

9,380,081

 

Cabot

 

140,777

 

8,473,368

 

Carpenter Technology

 

104,406

 

4,238,884

 

Chemours

 

414,057

 

16,682,357

 

Commercial Metals

 

259,102

 

4,829,661

 

Compass Minerals International

 

75,805

 

5,003,130

 

Domtar

 

143,370

 

5,684,620

 

Eagle Materials

 

109,568

 

10,515,241

 

Greif, Cl. A

 

57,925

 

3,395,564

 

Louisiana-Pacific

 

329,184

b

8,473,196

 

Minerals Technologies

 

78,385

 

6,168,899

 

NewMarket

 

20,933

 

9,853,163

 

Olin

 

376,535

 

12,098,070

 

Owens-Illinois

 

367,030

b

8,008,595

 

Packaging Corporation of America

 

212,883

 

21,028,583

 

PolyOne

 

189,833

 

7,443,352

 

Reliance Steel & Aluminum

 

164,789

 

12,988,669

 

Royal Gold

 

147,884

 

10,452,441

 

RPM International

 

301,949

 

15,870,439

 

Scotts Miracle-Gro

 

100,937

 

9,750,514

 

Sensient Technologies

 

99,744

 

8,159,059

 

Silgan Holdings

 

84,584

 

5,127,482

 

Sonoco Products

 

223,495

 

11,691,023

 

Steel Dynamics

 

547,678

 

19,793,083

 

United States Steel

 

396,526

 

8,850,460

 

Valspar

 

165,204

 

18,575,538

 

Worthington Industries

 

98,482

 

4,283,967

 
       

300,045,366

 

Media - 1.4%

         

AMC Networks, Cl. A

 

130,847

b

7,808,949

 

Cable One

 

10,637

 

7,252,945

 

Cinemark Holdings

 

239,352

 

10,340,006

 

John Wiley & Sons, Cl. A

 

100,938

 

5,319,433

 

Live Nation Entertainment

 

299,466

b

9,630,827

 

Meredith

 

82,556

 

4,833,654

 

New York Times, Cl. A

 

280,244

 

4,049,526

 

12

 

           
 

Common Stocks - 98.7% (continued)

 

Shares

 

Value ($)

 

Media - 1.4% (continued)

         

Time

 

227,172

 

3,453,014

 
       

52,688,354

 

Pharmaceuticals, Biotechnology & Life Sciences - 2.5%

         

Akorn

 

198,480

b

6,639,156

 

Bio-Rad Laboratories, Cl. A

 

47,079

b

10,275,463

 

Bio-Techne

 

83,712

 

8,963,881

 

Bioverativ

 

245,564

 

14,441,619

 

Catalent

 

279,892

b

8,195,238

 

Charles River Laboratories International

 

106,656

b

9,567,043

 

Endo International

 

448,899

b

5,103,982

 

INC Research Holdings, Cl. A

 

121,136

b

5,451,120

 

PAREXEL International

 

118,766

b

7,580,834

 

Prestige Brands Holdings

 

120,955

b

6,944,027

 

United Therapeutics

 

102,325

b

12,862,252

 
       

96,024,615

 

Real Estate - 9.7%

         

Alexander & Baldwin

 

103,440

 

4,759,274

 

American Campus Communities

 

303,143

c

14,365,947

 

Camden Property Trust

 

197,872

c

16,290,802

 

Care Capital Properties

 

187,845

c

5,047,395

 

CoreCivic

 

268,379

 

9,245,657

 

Corporate Office Properties Trust

 

225,246

c

7,374,554

 

Cousins Properties

 

948,077

c

8,049,174

 

CyrusOne

 

176,504

a,c

9,644,179

 

DCT Industrial Trust

 

209,332

 

10,583,826

 

Douglas Emmett

 

330,927

c

12,466,020

 

Duke Realty

 

803,359

c

22,277,145

 

Education Realty Trust

 

164,130

c

6,363,320

 

EPR Properties

 

145,091

c

10,549,567

 

First Industrial Realty Trust

 

263,072

c

7,402,846

 

GEO Group

 

276,057

c

9,198,219

 

Healthcare Realty Trust

 

265,530

c

8,709,384

 

Highwoods Properties

 

231,436

c

11,775,464

 

Hospitality Properties Trust

 

373,918

c

11,901,810

 

Jones Lang LaSalle

 

103,050

 

11,836,323

 

Kilroy Realty

 

221,039

c

15,589,881

 

Lamar Advertising, Cl. A

 

187,302

a,c

13,498,855

 

LaSalle Hotel Properties

 

255,012

c

7,283,143

 

Liberty Property Trust

 

334,420

c

13,567,419

 

13

 

STATEMENT OF INVESTMENTS (Unaudited) (continued)

           
 

Common Stocks - 98.7% (continued)

 

Shares

 

Value ($)

 

Real Estate - 9.7% (continued)

         

Life Storage

 

105,301

c

8,254,545

 

Mack-Cali Realty

 

201,501

c

5,450,602

 

Medical Properties Trust

 

797,630

c

10,425,024

 

National Retail Properties

 

332,932

c

14,056,389

 

Omega Healthcare Investors

 

447,370

c

14,763,210

 

Potlatch

 

92,261

c

4,156,358

 

Quality Care Properties

 

212,327

 

3,683,873

 

Rayonier

 

275,904

c

7,786,011

 

Senior Housing Properties Trust

 

540,827

c

11,638,597

 

Tanger Factory Outlet Centers

 

216,662

c

6,757,688

 

Taubman Centers

 

137,050

c

8,572,477

 

Uniti Group

 

345,256

 

9,480,730

 

Urban Edge Properties

 

205,822

c

5,248,461

 

Washington Prime Group

 

422,276

c

3,716,029

 

Weingarten Realty Investors

 

268,644

c

8,803,464

 
       

370,573,662

 

Retailing - 2.8%

         

Aaron's

 

142,693

 

5,128,386

 

American Eagle Outfitters

 

381,925

 

5,381,323

 

Big Lots

 

101,423

 

5,120,847

 

Cabela's

 

116,601

b

6,366,415

 

Chico's FAS

 

295,798

 

4,087,928

 

CST Brands

 

171,486

 

8,281,059

 

Dick's Sporting Goods

 

200,358

 

10,128,097

 

Dillard's, Cl. A

 

57,439

 

3,180,397

 

GameStop, Cl. A

 

228,531

 

5,185,368

 

HSN

 

71,603

 

2,642,151

 

J.C. Penney

 

699,620

a,b

3,763,956

 

Murphy USA

 

80,753

b

5,617,986

 

Office Depot

 

1,193,010

 

5,929,260

 

Pool

 

93,136

 

11,140,928

 

Sally Beauty Holdings

 

325,612

b

6,193,140

 

The Michaels Companies

 

237,685

b

5,552,322

 

Urban Outfitters

 

198,468

b

4,540,948

 

Williams-Sonoma

 

182,972

 

9,889,637

 
       

108,130,148

 

Semiconductors & Semiconductor Equipment - 2.4%

         

Cirrus Logic

 

146,408

b

9,421,355

 

Cree

 

224,941

b

4,921,709

 

14

 

           
 

Common Stocks - 98.7% (continued)

 

Shares

 

Value ($)

 

Semiconductors & Semiconductor Equipment - 2.4% (continued)

         

Cypress Semiconductor

 

746,971

a

10,465,064

 

First Solar

 

175,318

b

5,180,647

 

Integrated Device Technology

 

301,965

b

7,244,140

 

Microsemi

 

260,786

b

12,241,295

 

Monolithic Power Systems

 

86,449

 

7,910,083

 

Silicon Laboratories

 

93,978

b

6,686,535

 

Synaptics

 

79,157

a,b

4,335,429

 

Teradyne

 

451,168

 

15,912,695

 

Versum Materials

 

243,768

 

7,805,451

 
       

92,124,403

 

Software & Services - 7.5%

         

ACI Worldwide

 

268,489

b

5,769,829

 

Acxiom

 

177,368

b

5,125,935

 

ANSYS

 

193,031

b

21,264,295

 

Broadridge Financial Solutions

 

268,777

 

18,798,263

 

Cadence Design Systems

 

639,565

b

20,830,632

 

CommVault Systems

 

93,812

b

4,732,815

 

Convergys

 

212,242

 

4,777,567

 

CoreLogic

 

193,421

b

8,266,814

 

DST Systems

 

70,984

 

8,738,840

 

Fair Isaac

 

70,815

 

9,594,016

 

Fortinet

 

339,131

b

13,226,109

 

j2 Global

 

109,828

 

9,910,879

 

Jack Henry & Associates

 

176,473

 

17,103,763

 

Leidos Holdings

 

322,882

 

17,002,966

 

LogMeIn

 

118,954

 

13,441,802

 

Manhattan Associates

 

157,904

b

7,372,538

 

MAXIMUS

 

145,414

 

8,868,800

 

NeuStar, Cl. A

 

123,691

b

4,106,541

 

PTC

 

261,709

b

14,145,371

 

Sabre

 

461,531

 

10,804,441

 

Science Applications International

 

99,412

 

7,256,082

 

Take-Two Interactive Software

 

230,710

b

14,500,123

 

Tyler Technologies

 

75,827

b

12,404,539

 

Ultimate Software Group

 

67,096

b

13,598,346

 

WebMD Health

 

84,735

b

4,595,179

 

WEX

 

86,434

b

8,769,594

 
       

285,006,079

 

15

 

STATEMENT OF INVESTMENTS (Unaudited) (continued)

           
 

Common Stocks - 98.7% (continued)

 

Shares

 

Value ($)

 

Technology Hardware & Equipment - 6.6%

         

3D Systems

 

246,643

a,b

3,904,359

 

ARRIS International

 

428,425

b

11,134,766

 

Arrow Electronics

 

201,039

b

14,173,249

 

Avnet

 

293,278

 

11,346,926

 

Belden

 

94,603

 

6,593,829

 

Brocade Communications Systems

 

928,194

 

11,667,399

 

Ciena

 

316,578

b

7,252,802

 

Cognex

 

194,531

 

16,601,276

 

Coherent

 

55,915

b

12,055,274

 

Diebold Nixdorf

 

171,868

 

4,846,678

 

InterDigital

 

77,242

 

6,944,056

 

IPG Photonics

 

85,345

b

10,780,780

 

Jabil Circuit

 

413,346

 

11,995,301

 

Keysight Technologies

 

416,093

b

15,574,361

 

Knowles

 

198,466

b

3,518,802

 

Littelfuse

 

50,834

 

7,836,061

 

National Instruments

 

238,232

 

8,316,679

 

NCR

 

281,841

b

11,625,941

 

NetScout Systems

 

205,924

b

7,753,039

 

Plantronics

 

74,394

 

4,061,912

 

SYNNEX

 

65,471

 

7,099,021

 

Tech Data

 

78,599

b

7,517,994

 

Trimble

 

570,174

b

20,201,265

 

VeriFone Systems

 

256,026

b

4,746,722

 

ViaSat

 

118,752

a,b

7,603,691

 

Vishay Intertechnology

 

299,469

a

4,896,318

 

Zebra Technologies, Cl. A

 

120,413

b

11,351,334

 
       

251,399,835

 

Telecommunication Services - .3%

         

Frontier Communications

 

2,635,280

a

4,954,326

 

Telephone & Data Systems

 

211,638

 

5,811,579

 
       

10,765,905

 

Transportation - 1.7%

         

Avis Budget Group

 

196,202

b

5,984,161

 

Genesee & Wyoming, Cl. A

 

139,720

b

9,467,427

 

JetBlue Airways

 

761,970

b

16,633,805

 

Kirby

 

121,392

b

8,570,275

 

Landstar System

 

93,731

 

8,009,314

 

Old Dominion Freight Line

 

156,671

 

13,868,517

 

16

 

           
 

Common Stocks - 98.7% (continued)

 

Shares

 

Value ($)

 

Transportation - 1.7% (continued)

         

Werner Enterprises

 

98,984

 

2,702,263

 
       

65,235,762

 

Utilities - 5.4%

         

Aqua America

 

403,740

 

13,359,757

 

Atmos Energy

 

237,687

 

19,257,401

 

Black Hills

 

119,739

 

8,144,647

 

Great Plains Energy

 

489,880

 

14,495,549

 

Hawaiian Electric Industries

 

246,380

a

8,258,658

 

IDACORP

 

114,115

 

9,645,000

 

MDU Resources Group

 

444,528

 

11,957,803

 

National Fuel Gas

 

194,358

 

10,763,546

 

New Jersey Resources

 

193,970

 

7,826,689

 

NorthWestern

 

110,536

 

6,607,842

 

OGE Energy

 

451,484

 

15,702,614

 

ONE Gas

 

117,909

 

8,115,676

 

PNM Resources

 

178,660

 

6,655,085

 

Southwest Gas Holdings

 

108,399

 

9,079,500

 

UGI

 

390,790

 

19,602,026

 

Vectren

 

187,659

 

11,150,698

 

Westar Energy

 

321,060

 

16,704,752

 

WGL Holdings

 

116,739

 

9,626,298

 
       

206,953,541

 

Total Common Stocks (cost $2,559,611,635)

     

3,751,246,880

 

Short-Term Investments - .0%

 

Principal Amount ($)

 

Value ($)

 

U.S. Treasury Bills

         

0.75%, 6/15/17
(cost $2,302,825)

 

2,305,000

d

2,303,126

 

Other Investment - 1.3%

 

Shares

 

Value ($)

 

Registered Investment Company;

         

Dreyfus Institutional Preferred Government Plus Money Market Fund
(cost $48,314,669)

 

48,314,669

e

48,314,669

 

17

 

STATEMENT OF INVESTMENTS (Unaudited) (continued)

           
 

Investment of Cash Collateral for Securities Loaned - .4%

 

Shares

 

Value ($)

 

Registered Investment Company;

         

Dreyfus Institutional Preferred Money Market Fund, Hamilton Shares
(cost $15,015,557)

 

15,015,557

e

15,015,557

 

Total Investments (cost $2,625,244,686)

 

100.4%

 

3,816,880,232

 

Liabilities, Less Cash and Receivables

 

(.4%)

 

(15,165,999)

 

Net Assets

 

100.0%

 

3,801,714,233

 

a Security, or portion thereof, on loan. At April 30, 2017, the value of the fund’s securities on loan was $61,361,452 and the value of the collateral held by the fund was $65,227,898, consisting of cash collateral of $15,015,557 and U.S. Government & Agency securities valued at $50,212,341.

b Non-income producing security.

c Investment in real estate investment trust.

d Held by or on behalf of a counterparty for open futures contracts.

e Investment in affiliated money market mutual fund.

18

 

   

Portfolio Summary (Unaudited)

Value (%)

Capital Goods

10.6

Real Estate

9.7

Banks

8.2

Materials

7.9

Software & Services

7.5

Technology Hardware & Equipment

6.6

Health Care Equipment & Services

6.2

Utilities

5.4

Insurance

4.9

Consumer Services

3.6

Energy

3.4

Diversified Financials

3.3

Consumer Durables & Apparel

2.9

Retailing

2.8

Commercial & Professional Services

2.6

Pharmaceuticals, Biotechnology & Life Sciences

2.5

Food, Beverage & Tobacco

2.5

Semiconductors & Semiconductor Equipment

2.4

Short-Term/Money Market Investments

1.7

Transportation

1.7

Media

1.4

Automobiles & Components

.9

Household & Personal Products

.8

Food & Staples Retailing

.6

Telecommunication Services

.3

 

100.4

 Based on net assets.

See notes to financial statements.

19

 

STATEMENT OF FUTURES

April 30, 2017 (Unaudited)

             
 

Contracts

Market Value Covered by Contracts ($)

Expiration

Unrealized Appreciation ($)

 
           

Futures Long

   

E-mini Standard & Poor's Midcap

295

 

51,035,000

June 2017

473,538

 

Gross Unrealized Appreciation

 

473,538

 

See notes to financial statements.

20

 

STATEMENT OF ASSETS AND LIABILITIES

April 30, 2017 (Unaudited)

             

 

 

 

 

 

 

 

 

 

 

Cost

 

Value

 

Assets ($):

 

 

 

 

Investments in securities—See Statement of Investments
(including securities on loan, valued at $61,361,452)—Note 1(b):

 

 

 

 

Unaffiliated issuers

 

2,561,914,460

 

3,753,550,006

 

Affiliated issuers

 

63,330,226

 

63,330,226

 

Cash

 

 

 

 

3,450,890

 

Receivable for investment securities sold

 

 

 

 

3,359,975

 

Receivable for shares of Common Stock subscribed

 

 

 

 

2,238,145

 

Dividends and securities lending income receivable

 

 

 

 

1,979,765

 

Other assets

 

 

 

 

66,473

 

 

 

 

 

 

3,827,975,480

 

Liabilities ($):

 

 

 

 

Due to The Dreyfus Corporation and affiliates—Note 3(b)

 

 

 

 

1,330,046

 

Liability for securities on loan—Note 1(b)

 

 

 

 

15,015,557

 

Payable for investment securities purchased

 

 

 

 

6,572,306

 

Payable for shares of Common Stock redeemed

 

 

 

 

2,820,193

 

Payable for futures variation margin—Note 4

 

 

 

 

519,145

 

Accrued expenses

 

 

 

 

4,000

 

 

 

 

 

 

26,261,247

 

Net Assets ($)

 

 

3,801,714,233

 

Composition of Net Assets ($):

 

 

 

 

Paid-in capital

 

 

 

 

2,488,501,870

 

Accumulated undistributed investment income—net

 

 

 

 

11,112,787

 

Accumulated net realized gain (loss) on investments

 

 

 

 

109,990,492

 

Accumulated net unrealized appreciation (depreciation)
on investments (including $473,538 net unrealized
appreciation on futures)

 

 

 

1,192,109,084

 

Net Assets ($)

 

 

3,801,714,233

 

 

       

Net Asset Value Per Share

Investor Shares

Class I

 

Net Assets ($)

2,878,822,149

922,892,084

 

Shares Outstanding

78,566,297

25,228,951

 

Net Asset Value Per Share ($)

36.64

36.58

 

       

See notes to financial statements.

     

21

 

STATEMENT OF OPERATIONS

Six Months Ended April 30, 2017 (Unaudited)

             
             

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment Income ($):

 

 

 

 

Income:

 

 

 

 

Cash dividends:

 

 

 

 

Unaffiliated issuers

 

 

27,947,543

 

Affiliated issuers

 

 

136,794

 

Income from securities lending—Note 1(b)

 

 

532,402

 

Interest

 

 

6,468

 

Total Income

 

 

28,623,207

 

Expenses:

 

 

 

 

Management fee—Note 3(a)

 

 

4,477,204

 

Shareholder servicing costs—Note 3(b)

 

 

3,505,788

 

Directors’ fees—Note 3(a,c)

 

 

148,755

 

Loan commitment fees—Note 2

 

 

37,644

 

Interest expense—Note 2

 

 

1,073

 

Total Expenses

 

 

8,170,464

 

Less—Directors’ fees reimbursed by Dreyfus—Note 3(a)

 

 

(148,755)

 

Net Expenses

 

 

8,021,709

 

Investment Income—Net

 

 

20,601,498

 

Realized and Unrealized Gain (Loss) on Investments—Note 4 ($):

 

 

Net realized gain (loss) on investments

137,066,316

 

Net realized gain (loss) on futures

3,651,538

 

Net Realized Gain (Loss)

 

 

140,717,854

 

Net unrealized appreciation (depreciation) on investments

 

 

331,939,066

 

Net unrealized appreciation (depreciation) on futures

 

 

1,309,543

 

Net Unrealized Appreciation (Depreciation)

 

 

333,248,609

 

Net Realized and Unrealized Gain (Loss) on Investments

 

 

473,966,463

 

Net Increase in Net Assets Resulting from Operations

 

494,567,961

 

             

See notes to financial statements.

         

22

 

STATEMENT OF CHANGES IN NET ASSETS

                   
                   

 

 

 

 

Six Months Ended
April 30, 2017 (Unaudited)

 

 

 

Year Ended
October 31, 2016a

 

Operations ($):

 

 

 

 

 

 

 

 

Investment income—net

 

 

20,601,498

 

 

 

38,435,057

 

Net realized gain (loss) on investments

 

140,717,854

 

 

 

306,785,191

 

Net unrealized appreciation (depreciation)
on investments

 

333,248,609

 

 

 

(171,325,259)

 

Net Increase (Decrease) in Net Assets
Resulting from Operations

494,567,961

 

 

 

173,894,989

 

Distributions to Shareholders from ($):

 

 

 

 

 

 

 

 

Investment income—net:

 

 

 

 

 

 

 

 

Investor Shares

 

 

(26,534,814)

 

 

 

(36,004,235)

 

Class I

 

 

(10,489,747)

 

 

 

-

 

Net realized gain on investments:

 

 

 

 

 

 

 

 

Investor Shares

 

 

(235,966,420)

 

 

 

(329,464,990)

 

Class I

 

 

(72,401,716)

 

 

 

-

 

Total Distributions

 

 

(345,392,697)

 

 

 

(365,469,225)

 

Capital Stock Transactions ($):

 

 

 

 

 

 

 

 

Net proceeds from shares sold:

 

 

 

 

 

 

 

 

Investor Shares

 

 

470,378,474

 

 

 

784,480,251

 

Class I

 

 

941,783,181

 

 

 

6,001,720

 

Distributions reinvested:

 

 

 

 

 

 

 

 

Investor Shares

 

 

258,429,799

 

 

 

317,581,364

 

Class I

 

 

35,405,826

 

 

 

-

 

Cost of shares redeemed:

 

 

 

 

 

 

 

 

Investor Shares

 

 

(1,200,845,251)

 

 

 

(1,022,196,189)

 

Class I

 

 

(50,293,869)

 

 

 

(27,973)

 

Increase (Decrease) in Net Assets
from Capital Stock Transactions

454,858,160

 

 

 

85,839,173

 

Total Increase (Decrease) in Net Assets

604,033,424

 

 

 

(105,735,063)

 

Net Assets ($):

 

 

 

 

 

 

 

 

Beginning of Period

 

 

3,197,680,809

 

 

 

3,303,415,872

 

End of Period

 

 

3,801,714,233

 

 

 

3,197,680,809

 

Undistributed investment income—net

11,112,787

 

 

 

27,535,850

 

Capital Share Transactions (Shares):

 

 

 

 

 

 

 

 

Investor Sharesb

 

 

 

 

 

 

 

 

Shares sold

 

 

12,991,277

 

 

 

23,191,078

 

Shares issued for distributions reinvested

 

 

7,363,563

 

 

 

9,652,279

 

Shares redeemed

 

 

(32,545,007)

 

 

 

(29,721,816)

 

Net Increase (Decrease) in Shares Outstanding

(12,190,167)

 

 

 

3,121,541

 

Class Ib

 

 

 

 

 

 

 

 

Shares sold

 

 

25,419,413

 

 

 

167,576

 

Shares issued for distributions reinvested

 

 

1,011,414

 

 

 

-

 

Shares redeemed

 

 

(1,368,676)

 

 

 

(776)

 

Net Increase (Decrease) in Shares Outstanding

25,062,151

 

 

 

166,800

 

                   

On August 31, 2016, the fund redesignated existing shares as Investor shares and commenced offering Class I shares.

 

During the period ended April 30, 2017, 5,310 Class I shares representing $186,611 were exchanged for 5,297 Investor shares.

 

See notes to financial statements.

               

23

 

FINANCIAL HIGHLIGHTS

The following tables describe the performance for each share class for the fiscal periods indicated. All information (except portfolio turnover rate) reflects financial results for a single fund share. Total return shows how much your investment in the fund would have increased (or decreased) during each period, assuming you had reinvested all dividends and distributions. These figures have been derived from the fund’s financial statements.

                     
         

Six Months Ended

 

April 30, 2017

Year Ended October 31,

Investor Shares

(Unaudited)

2016a

2015

2014

2013

2012

Per Share Data ($):

           

Net asset value,
beginning of period

35.17

37.70

39.13

36.81

29.10

27.46

Investment Operations:

           

Investment income—netb

.20

.42

.39

.37

.35

.26

Net realized and unrealized
gain (loss) on investments

5.03

1.45

.81

3.64

8.80

2.72

Total from Investment Operations

5.23

1.87

1.20

4.01

9.15

2.98

Distributions:

           

Dividends from investment
income—net

(.38)

(.43)

(.40)

(.32)

(.34)

(.20)

Dividends from net realized
gain on investments

(3.38)

(3.97)

(2.23)

(1.37)

(1.10)

(1.14)

Total Distributions

(3.76)

(4.40)

(2.63)

(1.69)

(1.44)

(1.34)

Net asset value, end of period

36.64

35.17

37.70

39.13

36.81

29.10

Total Return (%)

15.37c

5.79

2.98

11.21

32.84

11.51

Ratios/Supplemental Data (%)

         

Ratio of total expenses
to average net assets

.51d

.51

.51

.51

.51

.51

Ratio of net expenses
to average net assets

.50d

.50

.50

.50

.50

.50

Ratio of net investment income
to average net assets

1.11d

1.23

1.00

.98

1.07

.92

Portfolio Turnover Rate

12.01c

21.68

19.45

16.22

10.41

12.76

Net Assets, end of period ($ x 1,000)

2,878,822

3,191,813

3,303,416

3,572,418

3,406,208

2,494,980

a On August 31, 2016, the fund redesignated existing shares as Investor shares.

b Based on average shares outstanding.

c Not annualized.

d Annualized.

See notes to financial statements.

24

 

                       
         
     

Six Months Ended

 
       

April 30, 2017

Period Ended

Class I Shares

     

(Unaudited)

October 31 2016a

Per Share Data ($):

           

Net asset value, beginning of period

       

35.18

36.39

Investment Operations:

           

Investment income—netb

       

.25

.02

Net realized and unrealized
gain (loss) on investments

       

5.02

(1.23)

Total from Investment Operations

       

5.27

(1.21)

Distributions:

           

Dividends from investment
income—net

       

(.49)

Dividends from net realized
gain on investments

       

(3.38)

Total Distributions

       

(3.87)

Net asset value, end of period

       

36.58

35.18

Total Return (%)c

       

15.50

(3.33)

Ratios/Supplemental Data (%):

           

Ratio of total expenses
to average net assetsd

       

.26

.26

Ratio of net expenses
to average net assetsd

       

.25

.25

Ratio of net investment income
to average net assetsd

       

1.30

.70

Portfolio Turnover Rate

       

12.01c

21.68

Net Assets, end of period ($ x 1,000)

       

922,892

5,867

a From August 31, 2016 (commencement of initial offering) to October 31, 2016.

b Based on average shares outstanding.

c Not annualized.

d Annualized.

See notes to financial statements.

25

 

NOTES TO FINANCIAL STATEMENTS (Unaudited)

NOTE 1—Significant Accounting Policies:

Dreyfus Midcap Index Fund, Inc. (the “fund”) is registered under the Investment Company Act of 1940, as amended (the “Act”), as a non-diversified open-end management investment company. The fund’s investment objective is to seek to match the performance of the Standard & Poor’s MidCap 400® Index. The Dreyfus Corporation (the “Manager” or “Dreyfus”), a wholly-owned subsidiary of The Bank of New York Mellon Corporation (“BNY Mellon”), serves as the fund’s investment adviser.

MBSC Securities Corporation (the “Distributor”), a wholly-owned subsidiary of Dreyfus, is the distributor of the fund’s shares, which are sold without a sales charge. The fund is authorized to issue 300 million shares of $.001 par value Common Stock. The fund currently has authorized two classes of shares: Investor shares (200 million shares authorized) and Class I (100 million shares authorized). Investor shares are sold primarily to retail investors through financial intermediaries and bear Shareholder Services Plan fees. Class I shares are sold at net asset value per share generally to institutional investors. Other differences between the classes include the services offered to and the expenses borne by each class, and certain voting rights. Income, expenses (other than expenses attributable to a specific class), and realized and unrealized gains or losses on investments are allocated to each class of shares based on its relative net assets.

The Financial Accounting Standards Board (“FASB”) Accounting Standards Codification is the exclusive reference of authoritative U.S. generally accepted accounting principles (“GAAP”) recognized by the FASB to be applied by nongovernmental entities. Rules and interpretive releases of the Securities and Exchange Commission (“SEC”) under authority of federal laws are also sources of authoritative GAAP for SEC registrants. The fund’s financial statements are prepared in accordance with GAAP, which may require the use of management estimates and assumptions. Actual results could differ from those estimates.

The fund enters into contracts that contain a variety of indemnifications. The fund’s maximum exposure under these arrangements is unknown. The fund does not anticipate recognizing any loss related to these arrangements.

(a) Portfolio valuation: The fair value of a financial instrument is the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement

26

 

date (i.e., the exit price). GAAP establishes a fair value hierarchy that prioritizes the inputs of valuation techniques used to measure fair value. This hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).

Additionally, GAAP provides guidance on determining whether the volume and activity in a market has decreased significantly and whether such a decrease in activity results in transactions that are not orderly. GAAP requires enhanced disclosures around valuation inputs and techniques used during annual and interim periods.

Various inputs are used in determining the value of the fund’s investments relating to fair value measurements. These inputs are summarized in the three broad levels listed below:

Level 1—unadjusted quoted prices in active markets for identical investments.

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

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

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. Valuation techniques used to value the fund’s investments are as follows:

Investments in securities are valued at the last sales price on the securities exchange or national securities market on which such securities are primarily traded. Securities listed on the National Market System for which market quotations are available are valued at the official closing price or, if there is no official closing price that day, at the last sales price. For open short positions, asked prices are used for valuation purposes. Bid price is used when no asked price is available. Registered investment companies that are not traded on an exchange are valued at their net asset value. All of the preceding securities are generally categorized within Level 1 of the fair value hierarchy.

Securities not listed on an exchange or the national securities market, or securities for which there were no transactions, are valued at the average of the most recent bid and asked prices. U.S. Treasury Bills are valued at the

27

 

NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)

mean price between quoted bid prices and asked prices by an independent pricing service (the “Service”) approved by the fund’s Board of Directors (the “Board”). These securities are generally categorized within Level 2 of the fair value hierarchy.

The Service is engaged under the general supervision of the Board.

Fair valuing of securities may be determined with the assistance of a pricing service using calculations based on indices of domestic securities and other appropriate indicators, such as prices of relevant American Depository Receipts and futures. Utilizing these techniques may result in transfers between Level 1 and Level 2 of the fair value hierarchy.

When market quotations or official closing prices are not readily available, or are determined not to reflect accurately fair value, such as when the value of a security has been significantly affected by events after the close of the exchange or market on which the security is principally traded (for example, a foreign exchange or market), but before the fund calculates its net asset value, the fund may value these investments at fair value as determined in accordance with the procedures approved by the Board. Certain factors may be considered when fair valuing investments such as: fundamental analytical data, the nature and duration of restrictions on disposition, an evaluation of the forces that influence the market in which the securities are purchased and sold, and public trading in similar securities of the issuer or comparable issuers. These securities are either categorized within Level 2 or 3 of the fair value hierarchy depending on the relevant inputs used.

For restricted securities where observable inputs are limited, assumptions about market activity and risk are used and are generally categorized within Level 3 of the fair value hierarchy.

Futures, which are traded on an exchange, are valued at the last sales price on the securities exchange on which such securities are primarily traded or at the last sales price on the national securities market on each business day and are generally categorized within Level 1 of the fair value hierarchy.

The following is a summary of the inputs used as of April 30, 2017 in valuing the fund’s investments:

28

 

         
 

Level 1 -
Unadjusted
Quoted Prices

Level 2 – Other
Significant
Observable
Inputs

Level 3 -
Significant
Unobservable
Inputs

Total

Assets ($)

       

Investments in Securities:

   

Equity Securities—Domestic
Common Stocks

3,737,984,780

3,737,984,780

Equity Securities—Foreign
Common Stocks

13,262,100

13,262,100

Registered
Investment
Companies

63,330,226

63,330,226

U.S. Treasury

2,303,126

2,303,126

Other Financial Instruments:

   

Futures††

473,538

473,538

 See Statement of Investments for additional detailed categorizations.

†† Amount shown represents unrealized appreciation at period end.

At April 30, 2017, there were no transfers between levels of the fair value hierarchy.

(b) Securities transactions and investment income: Securities transactions are recorded on a trade date basis. Realized gains and losses from securities transactions are recorded on the identified cost basis. Dividend income is recognized on the ex-dividend date and interest income, including, where applicable, accretion of discount and amortization of premium on investments, is recognized on the accrual basis.

Pursuant to a securities lending agreement with The Bank of New York Mellon, a subsidiary of BNY Mellon and an affiliate of Dreyfus, the fund may lend securities to qualified institutions. It is the fund’s policy that, at origination, all loans are secured by collateral of at least 102% of the value of U.S. securities loaned and 105% of the value of foreign securities loaned. Collateral equivalent to at least 100% of the market value of securities on loan is maintained at all times. Collateral is either in the form of cash, which can be invested in certain money market mutual funds managed by Dreyfus, or U.S. Government and Agency securities. The fund is entitled to receive all dividends, interest and distributions on securities loaned, in addition to income earned as a result of the lending transaction. Should a borrower fail to return the securities in a timely manner, The Bank of New York Mellon is required to replace the securities for the benefit of the fund or credit the fund with the market value of the unreturned securities and is subrogated to the fund’s rights against the

29

 

NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)

borrower and the collateral. Additionally, the contractual maturity of security lending transactions are on an overnight and continuous basis. During the period ended April 30, 2017, The Bank of New York Mellon earned $119,425 from lending portfolio securities, pursuant to the securities lending agreement.

(c) Affiliated issuers: Investments in other investment companies advised by Dreyfus are defined as “affiliated” under the Act. Investments in affiliated investment companies during the period ended April 30, 2017 were as follows:

           

Affiliated Investment Company

Value
10/31/2016 ($)

Purchases ($)

Sales ($)

Value 4/30/2017 ($)

Net Assets (%)

Dreyfus Institutional
Preferred
Government
Plus Money
Market Fund

31,678,167

390,296,069

373,659,567

48,314,669

1.3

Dreyfus Institutional
Preferred
Money
Market Fund,
Hamilton
Shares

174,867,178

479,040,977

638,892,598

15,015,557

.4

Total

206,545,345

869,337,046

1,012,552,165

63,330,226

1.7

(d) Dividends and distributions to shareholders: Dividends and distributions are recorded on the ex-dividend date. Dividends from investment income-net and dividends from net realized capital gains, if any, are normally declared and paid annually, but the fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code of 1986, as amended (the “Code”). To the extent that net realized capital gains can be offset by capital loss carryovers, it is the policy of the fund not to distribute such gains. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP.

(e) Federal income taxes: It is the policy of the fund to continue to qualify as a regulated investment company, if such qualification is in the best interests of its shareholders, by complying with the applicable provisions of the Code, and to make distributions of taxable income sufficient to relieve it from substantially all federal income and excise taxes.

As of and during the period ended April 30, 2017, the fund did not have any liabilities for any uncertain tax positions. The fund recognizes interest

30

 

and penalties, if any, related to uncertain tax positions as income tax expense in the Statement of Operations. During the period ended April 30, 2017, the fund did not incur any interest or penalties.

Each tax year in the three-year period ended October 31, 2016 remains subject to examination by the Internal Revenue Service and state taxing authorities.

The tax character of distributions paid to shareholders during the fiscal year ended October 31, 2016 was as follows: ordinary income $36,004,235 and long-term capital gains $329,464,990. The tax character of current year distributions will be determined at the end of the current fiscal year.

NOTE 2—Bank Lines of Credit:

The fund participates with other Dreyfus-managed funds in an $810 million unsecured credit facility led by Citibank, N.A. and a $300 million unsecured credit facility provided by The Bank of New York Mellon (each, a “Facility”), each to be utilized primarily for temporary or emergency purposes, including the financing of redemptions. In connection therewith, the fund has agreed to pay its pro rata portion of commitment fees for each Facility. Interest is charged to the fund based on rates determined pursuant to the terms of the respective Facility at the time of borrowing.

The average amount of borrowings outstanding under the Facilities during the period ended April 30, 2017 was approximately $133,100 with a related weighted average annualized interest rate of 1.63%.

NOTE 3—Management Fee and Other Transactions with Affiliates:

(a) Pursuant to a management agreement with Dreyfus, the management fee is computed at the annual rate of .25% of the value of the fund’s average daily net assets and is payable monthly. Out of its fee, Dreyfus pays all of the expenses of the fund except management fees, Shareholder Services Plan fees, brokerage fees and commissions, taxes, interest expense, commitment fees on borrowings, fees and expenses of the interested Directors (including counsel fees) and extraordinary expenses. In addition, Dreyfus is required to reduce its fee in an amount equal to the fund’s allocable portion of fees and expenses of the non-interested Directors (including counsel fees). During the period ended April 30, 2017, fees reimbursed by Dreyfus amounted to $148,755.

(b) Under the Shareholder Services Plan, Investor shares pay the Distributor at an annual rate of .25% of the value of its average daily net assets for the provision of certain services. The services provided may include personal services relating to shareholder accounts, such as

31

 

NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)

answering shareholder inquiries regarding the fund and providing reports and other information, and services related to the maintenance of shareholder accounts such as recordkeeping and sub-accounting services. The Distributor may make payments to Service Agents (securities dealers, financial institutions or other industry professionals) with respect to these services. The Distributor determines the amounts to be paid to Service Agents. During the period ended April 30, 2017, the fund was charged $3,505,788 pursuant to the Shareholder Services Plan.

The components of “Due to The Dreyfus Corporation and affiliates” in the Statement of Assets and Liabilities consist of: management fees $770,267 and Shareholder Services Plan fees $584,452, which are offset against an expense reimbursement currently in effect in the amount of $24,673.

(c) Each Board member also serves as a Board member of other funds within the Dreyfus complex. Annual retainer fees and attendance fees are allocated to each fund based on net assets.

NOTE 4—Securities Transactions:

The aggregate amount of purchases and sales of investment securities, excluding short-term securities and futures, during the period ended April 30, 2017, amounted to $543,694,003 and $423,670,583, respectively.

Derivatives: A derivative is a financial instrument whose performance is derived from the performance of another asset. Each type of derivative instrument that was held by the fund during the period ended April 30, 2017 is discussed below.

Futures: In the normal course of pursuing its investment objective, the fund is exposed to market risk, including equity price risk, as a result of changes in value of underlying financial instruments. The fund invests in futures in order to manage its exposure to or protect against changes in the market. A futures contract represents a commitment for the future purchase or a sale of an asset at a specified date. Upon entering into such contracts, these investments require initial margin deposits with a counterparty, which consist of cash or cash equivalents. The amount of these deposits is determined by the exchange or Board of Trade on which the contract is traded and is subject to change. Accordingly, variation margin payments are received or made to reflect daily unrealized gains or losses which are recorded in the Statement of Operations. When the contracts are closed, the fund recognizes a realized gain or loss which is reflected in the Statement of Operations. There is minimal counterparty credit risk to the fund with futures since they are exchange traded, and the

32

 

exchange guarantees the futures against default. Futures open at April 30, 2017 are set forth in the Statement of Futures.

The following summarizes the average market value of derivatives outstanding during the period ended April 30, 2017:

     

 

 

Average Market Value ($)

Equity futures

 

52,456,006

     

At April 30, 2017, accumulated net unrealized appreciation on investments was $1,191,635,546, consisting of $1,326,578,096 gross unrealized appreciation and $134,942,550 gross unrealized depreciation.

At April 30, 2017, the cost of investments for federal income tax purposes was substantially the same as the cost for financial reporting purposes (see the Statement of Investments).

NOTE 5—Pending Legal Matters:

The fund and dozens of other entities and individuals have been named as defendants in an adversary proceeding pending in the United States Bankruptcy Court for the Southern District of New York (Weisfelner, as Trustee of the LB Creditor Trust v. Fund 1, et al., Adv. Pro. No. 10-04609 the “Creditor Trust Action”). In addition, two separate adversary proceedings have been brought in the same Bankruptcy Court against putative defendant classes ( Weisfeiner, as Trustee of the LB Litigation Trust v. Hofman, at al., Adv. Pro No. 10-05525, the “Litigation Trust Action ”; Weisfelner, as Trustee of the LB Creditor Trust v. Reichman, et al., Adv. Pro. No. 12-1570; the “Reichman Action” and collectively with the Creditor Trust Action and the Litigation Trust Action, the “Actions”). In the Actions, plaintiffs allege that payments made to shareholders of Lyondell Chemical Company (“Lyondell”) in connection with the acquisition of Lyondell by Basell AF S.C.A. in a cash-out merger on December 20, 2007 constitute “fraudulent transfers” under applicable law, and seek to recover from the former Lyondell shareholders the merger consideration received for their shares. The Creditor Trust and Reichman Action assert state law claims for both intentional and constructive fraudulent transfer, while the Litigation Trust Action asserts a single claim for intentional fraudulent transfer.

On November 18, 2015, the Bankruptcy Court granted defendants’ motion to dismiss the intentional fraudulent transfer claim in all three Actions, and on July 20, 2016, the Bankruptcy Court in the Creditor Trust and Reichman Actions issued a Report and Recommendation (the “R&R”) to the United States District Court for the Southern District of New York recommending dismissal of the remaining constructive fraudulent transfer

33

 

NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)

claim; plaintiffs in these Actions filed objections to the R&R on August 3, 2016, which remain pending.

On July 27, 2016, the District Court reversed the Bankruptcy Court’s order dismissing the intentional fraudulent transfer claim in the Litigation Trust Action.

At this stage in the proceedings, it is not possible to assess with any reasonable certainty the probable outcome of the pending litigation. Consequently, at this time, management is unable to estimate the possible loss that may result.

34

 

INFORMATION ABOUT THE RENEWAL OF THE FUND’S MANAGEMENT AGREEMENT (Unaudited)

At a meeting of the fund’s Board of Directors held on March 9-10, 2017, the Board considered the renewal of the fund’s Management Agreement pursuant to which Dreyfus provides the fund with investment advisory and administrative services (the “Agreement”). The Board members, none of whom are “interested persons” (as defined in the Investment Company Act of 1940, as amended) of the fund, were assisted in their review by independent legal counsel and met with counsel in executive session separate from Dreyfus representatives. In considering the renewal of the Agreement, the Board considered all factors that it believed to be relevant, including those discussed below. The Board did not identify any one factor as dispositive, and each Board member may have attributed different weights to the factors considered.

Analysis of Nature, Extent, and Quality of Services Provided to the Fund. The Board considered information provided to them at the meeting and in previous presentations from Dreyfus representatives regarding the nature, extent, and quality of the services provided to funds in the Dreyfus fund complex. Dreyfus provided the number of open accounts in the fund, the fund’s asset size and the allocation of fund assets among distribution channels. Dreyfus also had previously provided information regarding the diverse intermediary relationships and distribution channels of funds in the Dreyfus fund complex (such as retail direct or intermediary, in which intermediaries typically are paid by the fund and/or Dreyfus) and Dreyfus’ corresponding need for broad, deep, and diverse resources to be able to provide ongoing shareholder services to each intermediary or distribution channel, as applicable to the fund.

The Board also considered research support available to, and portfolio management capabilities of, the fund’s portfolio management personnel and that Dreyfus also provides oversight of day-to-day fund operations, including fund accounting and administration and assistance in meeting legal and regulatory requirements. The Board also considered Dreyfus’ extensive administrative, accounting and compliance infrastructures. The Board also considered portfolio management’s brokerage policies and practices (including policies and practices regarding soft dollars) and the standards applied in seeking best execution.

Comparative Analysis of the Fund’s Performance and Management Fee and Expense Ratio. The Board reviewed reports prepared by Broadridge Financial Solutions, Inc. (“Broadridge”), an independent provider of investment company data, which included information comparing (1) the fund’s performance with the performance of a group of comparable funds (the “Performance Group”) and with a broader group of funds (the “Performance Universe”), all for various periods ended January 31, 2017, and (2) the fund’s actual and contractual management fees and total expenses with those of a group of comparable funds (the “Expense Group”) and with a broader group of funds (the “Expense Universe”), the information for which was derived in part from fund financial statements available to Broadridge as of the date of its analysis. Dreyfus previously had furnished the Board with a description of the methodology Broadridge used to select the Performance Group and Performance Universe and the Expense Group and Expense Universe.

35

 

INFORMATION ABOUT THE RENEWAL OF THE FUND’S MANAGEMENT AGREEMENT (Unaudited) (continued)

Dreyfus representatives stated that the usefulness of performance comparisons may be affected by a number of factors, including different investment limitations that may be applicable to the fund and comparison funds. The Board discussed with representatives of Dreyfus and/or its affiliates the results of the comparisons and considered that the fund’s total return performance was at or above the Performance Group and Performance Universe medians for all periods. Dreyfus also provided a comparison of the fund’s calendar year total returns to the returns of the fund’s benchmark index.

The Board also reviewed the range of actual and contractual management fees and total expenses of the Expense Group and Expense Universe funds and discussed the results of the comparisons. Taking into account the fund’s “unitary” fee structure, the Board considered that the fund’s contractual management fee was at the Expense Group median, the fund’s actual management fee was above the Expense Group and Expense Universe medians and the fund’s total expenses were at the Expense Group median and above the Expense Universe median.

Dreyfus representatives reviewed with the Board the management or investment advisory fees (1) paid by funds advised or administered by Dreyfus that are in the same Broadridge category as the fund and (2) paid to Dreyfus or the Dreyfus-affiliated primary employer of the fund’s primary portfolio manager(s) for advising any separate accounts and/or other types of client portfolios that are considered to have similar investment strategies and policies as the fund (the “Similar Clients”), and explained the nature of the Similar Clients. They discussed differences in fees paid and the relationship of the fees paid in light of any differences in the services provided and other relevant factors, noting the fund’s “unitary” fee structure. The Board considered the relevance of the fee information provided for the Similar Clients to evaluate the appropriateness of the fund’s management fee.

Analysis of Profitability and Economies of Scale. Dreyfus representatives reviewed the expenses allocated and profit received by Dreyfus and its affiliates and the resulting profitability percentage for managing the fund and the aggregate profitability percentage to Dreyfus and its affiliates for managing the funds in the Dreyfus fund complex, and the method used to determine the expenses and profit. The Board concluded that the profitability results were not unreasonable, given the services rendered and service levels provided by Dreyfus. The Board also had been provided with information prepared by an independent consulting firm regarding Dreyfus’ approach to allocating costs to, and determining the profitability of, individual funds and the entire Dreyfus fund complex. The consulting firm also had analyzed where any economies of scale might emerge in connection with the management of a fund.

The Board considered, on the advice of its counsel, the profitability analysis (1) as part of its evaluation of whether the fees under the Agreement, considered in relation to the mix of services provided by Dreyfus, including the nature, extent and quality of such services, supported the renewal of the Agreement and (2) in light of the relevant circumstances for the fund and the extent to which economies of scale would be realized if the fund grows and whether fee levels reflect these economies of scale for the benefit of fund shareholders. Dreyfus representatives also stated that, as a result of

36

 

shared and allocated costs among funds in the Dreyfus fund complex, the extent of economies of scale could depend substantially on the level of assets in the complex as a whole, so that increases and decreases in complex-wide assets can affect potential economies of scale in a manner that is disproportionate to, or even in the opposite direction from, changes in the fund’s asset level. The Board also considered potential benefits to Dreyfus from acting as investment adviser and took into consideration the soft dollar arrangements in effect for trading the fund’s investments.

At the conclusion of these discussions, the Board agreed that it had been furnished with sufficient information to make an informed business decision with respect to the renewal of the Agreement. Based on the discussions and considerations as described above, the Board concluded and determined as follows.

· The Board concluded that the nature, extent and quality of the services provided by Dreyfus are adequate and appropriate.

· The Board was satisfied with the fund’s performance.

· The Board concluded that the fee paid to Dreyfus supported the renewal of the Agreement in light of the considerations described above.

· The Board determined that the economies of scale which may accrue to Dreyfus and its affiliates in connection with the management of the fund had been adequately considered by Dreyfus in connection with the fee rate charged to the fund pursuant to the Agreement and that, to the extent in the future it were determined that material economies of scale had not been shared with the fund, the Board would seek to have those economies of scale shared with the fund.

In evaluating the Agreement, the Board considered these conclusions and determinations and also relied on its previous knowledge, gained through meetings and other interactions with Dreyfus and its affiliates, of Dreyfus and the services provided to the fund by Dreyfus. The Board also relied on information received on a routine and regular basis throughout the year relating to the operations of the fund and the investment management and other services provided under the Agreement, including information on the investment performance of the fund in comparison to similar mutual funds and benchmark performance indices; general market outlook as applicable to the fund; and compliance reports. In addition, the Board’s consideration of the contractual fee arrangements for this fund had the benefit of a number of years of reviews of the Agreement for the fund, or substantially similar agreements for other Dreyfus funds that the Board oversees, during which lengthy discussions took place between the Board and Dreyfus representatives. Certain aspects of the arrangements may receive greater scrutiny in some years than in others, and the Board’s conclusions may be based, in part, on their consideration of the fund’s arrangements, or similar arrangements for other Dreyfus funds that the Board oversees, in prior years. The Board determined to renew the Agreement.

37

 

For More Information

Dreyfus Midcap Index Fund, Inc.

200 Park Avenue
New York, NY 10166

Manager

The Dreyfus Corporation
200 Park Avenue
New York, NY 10166

Custodian

The Bank of New York Mellon
225 Liberty Street
New York, NY 10286

Transfer Agent &
Dividend Disbursing Agent

Dreyfus Transfer, Inc.
200 Park Avenue
New York, NY 10166

Distributor

MBSC Securities Corporation
200 Park Avenue
New York, NY 10166

   

Ticker Symbols:

Investor: PESPX  Class I: DMIDX

Telephone Call your financial representative or 1-800-DREYFUS

Mail The Dreyfus Family of Funds, 144 Glenn Curtiss Boulevard, Uniondale, NY 11556-0144

E-mail Send your request to info@dreyfus.com

Internet Information can be viewed online or downloaded at www.dreyfus.com

The fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (“SEC”) for the first and third quarters of each fiscal year on Form N-Q. The fund’s Forms N-Q are available on the SEC’s website at www.sec.gov and may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. (phone 1-800-SEC-0330 for information).

A description of the policies and procedures that the fund uses to determine how to vote proxies relating to portfolio securities and information regarding how the fund voted these proxies for the most recent 12-month period ended June 30 is available at www.dreyfus.com and on the SEC’s website at www.sec.gov and without charge, upon request, by calling 1-800-DREYFUS.

   

© 2017 MBSC Securities Corporation
0113SA0417

 


 

Item 2.       Code of Ethics.

                  Not applicable.

Item 3.       Audit Committee Financial Expert.

                  Not applicable.

Item 4.       Principal Accountant Fees and Services.

                  Not applicable.

Item 5.       Audit Committee of Listed Registrants.

                  Not applicable.

Item 6.       Investments.

(a)              Not applicable.

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.

                  There have been no material changes to the procedures applicable to Item 10.

Item 11.     Controls and Procedures.

(a)        The Registrant's principal executive and principal financial officers have concluded, based on their evaluation of the Registrant's disclosure controls and procedures as of a date within 90 days of the filing date of this report, that the Registrant's 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 Registrant's management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.

(b)        There were no changes to the Registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Registrant's internal control over financial reporting.


 

Item 12.     Exhibits.

(a)(1)   Not applicable.

(a)(2)   Certifications of principal executive and principal financial officers as required by Rule 30a-2(a) under the Investment Company Act of 1940.

(a)(3)   Not applicable.

(b)        Certification of principal executive and principal financial officers as required by Rule 30a-2(b) under the Investment Company Act of 1940.

 


 

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.

Dreyfus Midcap Index Fund, Inc.

By:       /s/ Bradley J. Skapyak

            Bradley J. Skapyak

            President

 

Date:    June 29, 2017

 

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

 

By:       /s/ Bradley J. Skapyak

            Bradley J. Skapyak

            President

 

Date:    June 29, 2017

 

 

By:       /s/ James Windels

            James Windels

            Treasurer

 

Date:    June 29, 2017

 

 

 


 

EXHIBIT INDEX

(a)(2)   Certifications of principal executive and principal financial officers as required by Rule 30a-2(a) under the Investment Company Act of 1940.  (EX-99.CERT)

(b)        Certification of principal executive and principal financial officers as required by Rule 30a-2(b) under the Investment Company Act of 1940.  (EX-99.906CERT)

EX-99.CERT 2 exhibit302113.htm CERTIFICATION REQUIRED BY RULE 30A-2 exhibit302113.htm - Generated by SEC Publisher for SEC Filing

[EX-99.CERT]—Exhibit (a)(2)

SECTION 302 CERTIFICATION

 

I, Bradley J. Skapyak, certify that:

1.  I have reviewed this report on Form N-CSR of Dreyfus Midcap Index Fund, Inc.;

2.  Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.  Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4.  The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting;

5.  The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

                                                                        By:       /s/ Bradley J. Skapyak

                                                                                    Bradley J. Skapyak

                                                                                    President

 

                                                                        Date:    June 29, 2017

1

 


 

SECTION 302 CERTIFICATION

I, James Windels, certify that:

1.  I have reviewed this report on Form N-CSR of Dreyfus Midcap Index Fund, Inc.;

2.  Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.  Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4.  The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting;

5.  The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

                                                                        By:       /s/ James Windels

                                                                                    James Windels

                                                                                    Treasurer

 

                                                                        Date:    June 29, 2017

 

2

 

EX-99.906CERT 3 exhibit906113.htm CERTIFICATION REQUIRED BY SECTION 906 exhibit906113.htm - Generated by SEC Publisher for SEC Filing

[EX-99.906CERT]

Exhibit (b)

 

 

SECTION 906 CERTIFICATIONS

            In connection with this report on Form N-CSR for the Registrant as furnished to the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned hereby certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

            (1)        the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as applicable; and

 

            (2)        the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

 

                                                                        By:       /s/ Bradley J. Skapyak

                                                                        Bradley J. Skapyak

                                                                                    President

                                                                        Date:    June 29, 2017

 

 

                                                                        By:       /s/ James Windels

                                                                                    James Windels

                                                                                    Treasurer

 

                                                                        Date:    June 29, 2017

 

 

This certificate is furnished pursuant to the requirements of Form N-CSR and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section, and shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934.

 

 

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