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Investor Alert

Why Bad News Is Good News in Europe—7 Charts Showing What You Really Need to Know
February 20, 2015

By Frank Holmes
CEO and Chief Investment Officer
U.S. Global Investors

There’s little denying that the U.S. economy is on the upswing since the recession. Manufacturing is strong, jobless claims are falling and wages are rising. Delta Air Lines, which we own in our Holmes Macro Trends Fund (MEGAX), recently announced that it will be giving its 80,000 employees $1.1 billion in profit sharing, while Wal-Mart, held in our All American Equity Fund (GBTFX), unveiled plans to hike its minimum wage to $9 an hour in April.

Indeed, things are shaping up here in the U.S., but unfortunately this has not been the case in Europe. From Greek drama to Russian aggression, bad news seems to be the order of the day.

Until now.

Because of central banks’ monetary easing, weakening currencies and low fuel costs—courtesy of the American fracking boom—Europe is finally showing signs that it’s ready to turn the corner and set a path toward lasting economic recovery.


1. Emerging Europe PMIs Swinging Up

The Purchasing Managers’ Index (PMI), as I’ve often said, is a highly effective tool that we use to forecast manufacturing activity six months out. Any reading above 50 indicates growth in manufacturing; anything below, contraction. This allows us to manage our expectations and get a good sense of where to position our funds.

As you can see, the European Union (EU) as a whole has recently improved, but emerging countries such as the Czech Republic, Poland and Hungary are posting very solid numbers in the mid-50s range. Much of this is due to low fuel costs and weaker currencies, which make exports more attractive.

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2. Growth in the Eurozone Is Good for the Globe

Our investment team’s research has shown that when the one-month reading for the global PMI crossed below the three-month moving average, there was a significant probability that materials, energy and commodities would fall six months later. Conversely, when it crossed above, manufacturing activity would ramp up, which greatly improved the performance of commodities such as copper and crude oil, not to mention the materials and energy sectors.

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It’s very welcome news, then, to see growth in the eurozone, since its PMI readings are factored into the global score. Today we learned that the preliminary Flash Eurozone PMI advanced to 53.5 for the month of February. This is huge. Not only is it a seven-month high for the eurozone, but it’s also nearly in line with the U.S. reading, which came in at 54.3. Even France—a perennial and disappointing laggard in manufacturing—posted its best results in three-and-a-half years.

3. Surprise! Europe Is Beating Expectations

The Citi Economic Surprise Index, simply put, tells you if a country or region’s economic news is beating—or, conversely, falling below—analysts’ expectations. The higher the number, the more it indicates that economic data is exceeding forecasts.

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You can see above where the eurozone has surprised consensus. For most of 2014, the region was in a declining trend, whereas the U.S. was headed higher. More recently, though, we’ve seen a huge advancement in Europe, despite negative news coming out of areas such as Greece—which today managed to strike a deal with its euro-partners to extend the Mediterranean country’s bailout program by four months.

4. GDP Growing

If you look at Europe’s GDP as a whole, it’s expected to grow slightly over 1 percent in 2015. But the GDP in Eastern European countries such as the Czech Republic, Romania, Poland and Hungary is expected to grow double that or more.

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These countries are benefiting from the broad recovery, for sure, but they also have their own dynamics. As emerging markets, they have more room to run and grow. 

5. No Lack of Confidence in Consumption

Another sign that the European recovery is underway is the recent uptick in spending habits. Not only does the consumer confidence index (CCI) for the eurozone far exceed its long-term average, but it’s also at its highest reading since soon before the financial crisis.

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6. Russia, the Not-So-Bad News Bear?

Nearly every day we’re reminded of Russia’s political and financial troubles, but the worst is likely behind us. It appears as if Russia’s market and currency, the ruble, bottomed in mid-December. This is also the first time since the summer that the MICEX Index crossed above its 50-day moving average, breaking through resistance.

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The situation in Ukraine is not pretty, but global investors understand it and are getting comfortable putting their money in Russia again because it’s inexpensive. The bad news has been priced in, and it looks as if the market is willing to move higher.

Russian credit default swaps (CDS) are also looking better. CDSs allow sellers to assume and buyers to reduce default risk on a bond. The swap spreads improved in February, indicating the market is looking past current events such as international sanctions and the ceasefire in Ukraine and seeing Russia’s risk declining in the future.   

7. Low Valuations, High Dividend Yields

Emerging European equities, like Russian stocks, are trading at a big discount relative to those in U.S. and Western European markets. 

Emerging Europe Cheap Relative to Developed Markets
Country Index P/E Ratio Dividend Yield
Western Europe Stoxx 600 23.6 3.6%
United States S&P 500 Index 18.4 2.0%
Poland WIG 20 15.5 3.9%
Romania Bucharest BET Index 9.9 3.6%
Turkey BIST 100 Index 9.6 1.8%
Russia MICEX Index 9.0 4.1%

Many of the emerging European countries are currently trading at less than 10 times. Therefore, you get that winning combination of low valuation and high dividend yield.

We’re definitely starting to see the early signs that Europe is reflating its economy. Attractive PMI data, positive economic surprises and growing consumer confidence all point to a strong recovery, one that should bode well for global investors in general and our Emerging Europe Fund (EUROX) specifically. 

In case you missed this week’s webcast on this very topic, you can still listen to the replay on demand and download the slideshow.

Time-Tested History of No Drama - Near-Term Tax Free Fund - U.S. Global Investors

Index Summary

  • The major market indices finished higher this week.  The Dow Jones Industrial Average rose 0.67 percent. The S&P 500 Stock Index advanced 0.63 percent, while the Nasdaq Composite moved higher by 1.27 percent. The Russell 2000 small capitalization index rose 0.71 percent this week.
  • The Hang Seng Composite rose 0.61 percent; Taiwan was closed this week and the KOSPI advanced 0.20 percent.
  • The 10-year Treasury bond yield rose 6 basis points to 2.11 percent.
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Domestic Equity Market

The S&P 500 hit another new high this week as the markets embraced the de-escalation of political events in Greece, better economic data out of Europe and dovish comments from the Federal Reserve. Sector returns were generally positive except for energy and telecommunications. Cyclical areas of the market have been stronger recently and that theme continued this week.

S&P 500 Economic Sectors
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  • The health care sector was the best performer this week. Boston Scientific was the best individual health care performer, rising nearly 10 percent as the company reached a settlement with Johnson & Johnson related to an acquisition that removed a significant overhang on the stock.  Biotech stocks had a good week with large cap names Celgene and Biogen Idec leading the charge.
  • The industrials sector was also strong as airlines and aircraft-related areas outperformed. Delta Air Lines, Southwest Airlines and Boeing were among the leaders this week. Lower oil prices and generally better global economic data were the drivers.
  • Tesoro was the best performer in the S&P 500 this week rising by 10.57 percent. An explosion at an Exxon Mobil refinery in Los Angeles was the primary driver as it appears the refinery could be offline for some time and Tesoro would be one of the primary beneficiaries in that market.


  • The energy sector was the worst performer this week as oil prices declined and oil inventories continued to build. The major integrated and offshore related companies were among the worst performers.
  • In an otherwise strong week there were pockets of weakness, which included REITs and consumer electronics manufacturers. 
  • Fossil Group was the worst performing company in the S&P 500 this week, falling 13.51 percent. Fourth quarter sales rose less than 1 percent and earnings missed expectations. Fiscal 2015 guidance from the company also disappointed.


  • Cyclicals are outperforming so far in February as improving global growth prospects provide a lift.
  • A strong dollar continues to benefit domestic consumers, maintaining an advantage for certain U.S.-focused retailers and consumer products.
  • The energy sector could very well be beginning its comeback as global growth concerns begin to ease and supply conditions begin to tighten.


  • Consumer sentiment indicators are already showing some retracement as the low oil price gasoline “tax cut” looks like it may be short lived for consumer sentiment. We will get a fresh update next week with both the consumer confidence index and the University of Michigan confidence survey out next week.
  • An improving global economy and U.S. economic data that supports an improving job market may very well be enough to allow the Fed to raise rates as soon as June.
  • Defensive plays should be monitored closely now that yields have turned the corner and investor sentiment is more positive.

Time-Tested History of No Drama - Near-Term Tax Free Fund - U.S. Global Investors

The Economy and Bond Market

U.S. Treasury bond yields moved higher for the second week in a row on mixed U.S. data but improving European data. Dovish minutes from the Federal Open Market Committee (FOMC) meeting in January also fueled speculation that the Fed might not raise rates until 2016. These data points combined to push yields higher. It is somewhat counter-intuitive, but as the Fed talked up the prospects of a June 2015 rate hike, the long end rallied sharply in January. The thinking behind this move is that the economy is not strong enough to withstand the rate hike in addition to the slowing effects of a much stronger U.S. dollar.

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  • Eurozone flash Purchasing Managers’ Indices (PMIs) rose in February and exceeded market expectations. This is an indication that Europe has turned the corner economically, regardless of all the noise surrounding Greece.
  • Producer prices for January fell 0.8 percent and now stand flat with a year ago. This is positive for real incomes.
  • European economic data generally positively surprised; for example, Germany’s ZEW confidence survey improved dramatically from January.


  • Chinese home prices fell 5.1 percent in January, the fifth-straight month of declines.
  • Housing starts and building permits maintained a relatively high level but disappointed versus expectations.
  • Industrial production rose a modest 0.2 percent in January, about half the expected growth.


  • Europe appears to be rapidly improving and may positively surprise in 2015.
  • Chinese inflation recently hit a five-year low. The central bank recently lowered the reserve requirement for banks (easing policy) and is expected to do more in the near future as inflation remains muted.
  • The Conference Board’s Leading Economic Indicators rose 0.2 percent in January and indicate continued economic expansion for the next couple of quarters. 


  • One of the themes from the recent earnings season was the strong U.S. dollar which has negatively impacted companies’ bottom lines. That will likely be the case for the first quarter as well.
  • The wave of monetary stimulus coming back over the global economy, while positive for economic growth, could have unintended consequences in the form of currency wars.
  • While the Fed minutes had a dovish tone, the Fed could still raise interest rates as soon as this summer.

Time-Tested History of No Drama - Near-Term Tax Free Fund - U.S. Global Investors

Gold Market

For the week, spot gold closed at $1,202.85 down $26.58 per ounce, or 2.16 percent. Gold stocks, as measured by the NYSE Arca Gold Miners Index, lost 3.58 percent. The U.S. Trade-Weighted Dollar Index edged up 0.14 percent for the week.

Date Event Survey Actual Prior
Feb-17 German ZEW Survey Current Situation 30 45.5 22.4
Feb-17 German ZEW Survey Expectations 55 53 48.4
Feb-18 U.S. Housing Starts 1070K 1065K 1089K
Feb-18 U.S. PPI Final Demand YoY 0.30% 0.00% 1.10%
Feb-19 U.S. Initial Jobless Claims 290K 283K 304K
Feb-24 Europe CPI Core YoY 0.60% -- 0.60%
Feb-24 U.S. Consumer Confidence Index 99.5 -- 102.9
Feb-24 HSBC China Manufacturing PMI 49.5 -- 49.7
Feb-25 U.S. New Home Sales 470K -- 481K
Feb-26 Hong Kong Exports YoY 2.20% -- 0.60%
Feb-26 U.S. CPI YoY -0.10% -- -0.80%
Feb-26 U.S. Durable Goods Orders 1.60% -- -3.40%
Feb-26 U.S.Initial Jobless Claims 290K -- 283K
Feb-27 German CPI YoY -0.30% -- -0.40%
Feb-27 U.S. GDP Annualized QoQ 2.00% -- 2.60%



  • The minutes from the Federal Reserve’s January meeting showed that policy makers argued for keeping interest rates near record lows for longer due to both the stronger dollar and the crisis in Greece. This news favors the case for both gold and silver.
  • Mandalay Resources announced its proven and probable gold reserves were up 136 percent in 2014 as a result of the Bjorkdal mine acquisition. Richmont Mines announced revenues were up 47 percent and operating cash flow was up 689 percent in 2014.
  • Timmins Gold announced it will acquire Newstrike Capital by way of a court-approved plan. This continues the recent streak of acquisitions in the mining space.


    • Alamos Gold announced that legal challenges in Turkey have increased uncertainty of the expected timing for receipt of permits for its Kirazli project.
    • According to a study of almost 100 global gold mining transactions by the Bloomberg Intelligence Metals and Mining team, valuations for gold mining deals peaked in 2011 and then fell more than 70 percent to a historical low in 2014. Mine prices fell faster than the metal due to lack of corporate interest in deals. As a result, gold mine values fell 350 percent more than the metal’s price.
    • Michael Rawlinson, Global Co-Head of Mining and Metals at Barclays, commented that while the sharp drop in oil prices has reduced costs for mining companies it has also added to uncertainty in the market and could prolong the wait for the commodity cycle to turn upwards again. This is mainly due to two unforeseen events: the drop in iron ore prices and the sudden collapse of the oil price.


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    • RBC Capital Markets published a report highlighting Osisko Gold Royalties as being well positioned to outperform in the current price environment. This is due to a strong balance sheet that could allow it to pursue accretive deals as well as positive optionality in its existing portfolio. This is yet another implication of the gold-royalty business model which has outperformed the broader gold miner stocks in recent years.
    • Dundee Capital Markets initiated coverage of Klondex Mines with a “buy” rating. It highlighted that the company is positioned as a high margin and growing producer, has no material capital requirements, and that the company is forecasted to generate sizable free cash flow. Furthermore, the company’s assets host highly prospective exploration upside.
    • John Thornton, Barrick Gold’s chairman, commented that he’s planning on returning the company to its partnership culture that used to define it in its early days, underpinning much of its success. Newcrest Mining announced it is open to selling its Telfer gold and copper mine in Australia.


    • House Democrats have launched a perpetual U.S. mining reform crusade proposing measures that would force miners to pay royalties for minerals extracted from public lands and contribute to a fund for clean-up costs.
    • Sibanye’s CEO announced that the company is through with buying assets as it deems them expensive in the current environment. Nonetheless, he still sees potential for substantial synergies between companies.
    • Bank of America announced that gold may drop to $1,150 in the next few weeks citing the outlook for U.S. monetary policy.

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    Energy and Natural Resources Market



    • Oil & gas refining stocks outperformed this week as the spread between WTI and Brent crude oil continues to widen, fueling margin expansion. The S&P Supercomposite Oil & Gas Refining & Marketing Index rose 2.48 percent this week.
    • Construction and engineering stocks continued to rally this week as global growth concerns dissipate. The S&P Supercomposite Construction & Engineering Index rose 2.07 percent this week.
    • Packaged food stocks rose also rose this week as the U.S. dollar remains elevated at current levels. The S&P Supercomposite Packaged Foods Index rose 1.39 percent this week.


    • Higher beta energy stocks underperformed for the week as WTI crude oil prices fell for the first time after a three-week streak of positive gains. The S&P/TSX Capped Energy Index fell 3.63 percent this week.
    • Precious metals stocks retreated this week despite the Federal Reserve minutes which revealed a more dovish stance on interest rates. The NYSE Arca Gold Miners Index fell 3.58 percent, while the Global X Silver Miners ETF fell 7.27 percent.
    • Oil & gas producers declined this week as oil declined. The S&P Supercomposite Oil & Gas Exploration & Production Index fell 2.76 percent this week.


    • The collapse of crude oil prices will be reflected in cuts to capital expenditures by many energy companies this year. Capital expenditures could fall by as much as 30 percent, which would be a significant force in restoring the balance between supply and demand for crude oil.
    • Economic data released from the eurozone continue to positively surprise markets as the flash composite purchasing managers’ index (PMI) reading came in higher than expected. A recovery in the eurozone is necessary for global growth to reach its potential, and could also help to increase commodity demand.
    • The Energy Information Administration (EIA) reported that U.S. oil product demand has grown 4.8 percent year-over-year. This is one of the highest growth rates in 20 years.


    • The U.S. dollar seems to have consolidated at current levels. It will take time as well as a stronger global growth outlook to reverse its trend.
    • Despite a sharp decline in the rig count, crude inventories continue to rise. Such levels remain a threat to oil prices until they are corrected.
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    Global Airline Stocks Soaring, and Not Just Because of Low Oil Prices
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    Emerging Markets



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    • Despite weak underlying fundamentals, Brazilian markets rallied this week. However, returns were muted in dollar terms as the real currency sunk to its weakest level since October 2004. The Ibovespa Brasil Sao Paulo Stock Exchange Index rose 1.19 percent this week.
    • Indian equities outperformed this week on speculation that Finance Minister Arun Jaitley will increase infrastructure spending. The S&P BSE SENSEX Index closed up 0.47 percent this week.
    • Indonesian stocks rallied this week after the government enacted a surprise rate cut. The Jakarta Stock Exchange Composite Index rose 0.48 percent this week.


    • Greek stocks slid this week after the newly-elected Finance Minister and other eurozone representatives failed to reach an agreement for extending the bailout program until Friday. The Athens Stock Exchange closed down 4.46 percent.
    • Russian markets underperformed this week as crude prices ended a three week rally. The MICEX Index fell 2.47 percent this week.
    • This week Colombian stocks fell alongside crude oil prices as well. The Indice General de la Bolsa de Valores de Colombia fell 1.77 percent.


    • Historically, Chinese equities tend to exhibit a seasonal pattern of positive returns in the weeks immediately following the Lunar New Year holidays. You can see these returns in the chart below, which is based on the last 10 years of market history.  Today’s accommodative government policy bias in China should dissuade investors from exiting the market prematurely in anticipation of further monetary or fiscal easing. Additionally, the best plays in a lower interest rate environment in China remain financials and property. 

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    • The yield on U.S. 10-year government bonds has risen back above 2 percent, which means demand for U.S. Treasuries are falling. Slowing demand for this safe-haven asset is a sign of resurgence for “risk on” investor sentiment. This movement should be positive for emerging markets.
    • The flash composite of Markit’s purchasing managers’ index (PMI) data came in at 53.5 this week, compared to an expected 53.0. This positive surprise is seen as evidence of a recovering eurozone.


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    • Ukraine’s economy is in a crisis. The severe inversion of the yield curve for Ukrainian government bonds is just one indication of the recessionary forces suppressing the Ukrainian economy. With no clear resolution in sight between Ukraine and the rebel forces, this country remains a hazardous place to invest.
    • Russian economic indicators are revealing the full effect of the country’s fiscal and financial troubles. Real wage growth in Russia has retreated to its lowest point since 2009 as inflationary pressures surge and economic activity stagnates. Furthermore, in a release issued on Friday, Moody’s announced that it cut its rating on Russia to “junk.”
    • Hong Kong’s first annual decline of retail sales in 11 years, paired with its decline in per capita spending by overnight visitors in 10 years, should alert investors about the diminishing attractiveness of the city for mainland Chinese.  Chinese outbound tourists traveling farther away from the country may continue to weigh on Hong Kong’s retail sector.

    Uncover the Patterns in Commodity Returns

    Leaders and Laggards

    The tables show the weekly, monthly and quarterly performance statistics of major equity and commodity market benchmarks of our family of funds.

    Weekly Performance
    Index Close Weekly
    DJIA 18,140.44 +121.09 +0.67%
    S&P 500 2,110.30 +13.31 +0.63%
    S&P Energy 589.07 -14.33 -2.37%
    S&P Basic Materials 325.79 +3.16 +0.98%
    Nasdaq 4,955.97 +62.13 +1.27%
    Russell 2000 1,231.79 +8.66 +0.71%
    Hang Seng Composite Index 3,385.18 +21.07 +0.63%
    Korean KOSPI Index 1,961.45 +3.95 +0.20%
    S&P/TSX Canadian Gold Index 175.88 -4.44 -2.46%
    XAU 74.28 -2.84 -3.68%
    Gold Futures 1,202.50 -24.60 -2.00%
    Oil Futures 50.34 -2.44 -4.62%
    Natural Gas Futures 2.95 +0.14 +5.06%
    10-Yr Treasury Bond 2.11 +0.06 +3.02%
    Monthly Performance
    Index Close Monthly
    DJIA 18,140.44 +586.16 +3.34%
    S&P 500 2,110.30 +78.18 +3.85%
    S&P Energy 589.07 +18.92 +3.32%
    S&P Basic Materials 325.79 +21.96 +7.23%
    Nasdaq 4,955.97 +288.55 +6.18%
    Russell 2000 1,231.79 +65.54 +5.62%
    Hang Seng Composite Index 3,385.18 -332.01 -14.83%
    Korean KOSPI Index 1,961.45 +40.22 +2.09%
    S&P/TSX Canadian Gold Index 175.88 -14.38 -7.56%
    XAU 74.28 -6.93 -8.53%
    Gold Futures 1,202.50 -92.20 -7.12%
    Oil Futures 50.34 +2.56 +5.36%
    Natural Gas Futures 2.95 -0.03 -0.94%
    10-Yr Treasury Bond 2.11 +0.24 +12.81%
    Quarterly Performance
    Index Close Quarterly
    DJIA 18,140.44 +330.38 +1.86%
    S&P 500 2,110.30 +46.80 +2.27%
    S&P Energy 589.07 -56.53 -8.76%
    S&P Basic Materials 325.79 +7.82 +2.46%
    Nasdaq 4,955.97 +243.00 +5.16%
    Russell 2000 1,231.79 +59.37 +5.06%
    Hang Seng Composite Index 3,385.18 +160.94 +4.99%
    Korean KOSPI Index 1,961.45 -3.39 -0.17%
    S&P/TSX Canadian Gold Index 175.88 +22.47 +14.65%
    XAU 74.28 +0.51 +0.69%
    Gold Futures 1,202.50 +3.60 +0.30%
    Oil Futures 50.34 -26.17 -34.20%
    Natural Gas Futures 2.95 -1.32 -30.94%
    10-Yr Treasury Bond 2.11 -0.20 -8.57%

    Please consider carefully a fund’s investment objectives, risks, charges and expenses. For this and other important information, obtain a fund prospectus by visiting or by calling 1-800-US-FUNDS (1-800-873-8637). Read it carefully before investing. Distributed by U.S. Global Brokerage, Inc.

    All opinions expressed and data provided are subject to change without notice. Some of these opinions may not be appropriate to every investor.

    Foreign and emerging market investing involves special risks such as currency fluctuation and less public disclosure, as well as economic and political risk. By investing in a specific geographic region, a regional fund’s returns and share price may be more volatile than those of a less concentrated portfolio.

    The Emerging Europe Fund invests more than 25 percent of its investments in companies principally engaged in the oil & gas or banking industries. The risk of concentrating investments in this group of industries will make the fund more susceptible to risk in these industries than funds which do not concentrate their investments in an industry and may make the fund’s performance more volatile.

    Because the Global Resources Fund concentrates its investments in a specific industry, the fund may be subject to greater risks and fluctuations than a portfolio representing a broader range of industries.

    Gold, precious metals, and precious minerals funds may be susceptible to adverse economic, political or regulatory developments due to concentrating in a single theme. The prices of gold, precious metals, and precious minerals are subject to substantial price fluctuations over short periods of time and may be affected by unpredicted international monetary and political policies. We suggest investing no more than 5 percent to 10 percent of your portfolio in these sectors.

    Bond funds are subject to interest-rate risk; their value declines as interest rates rise. Tax-exempt income is federal income tax free. A portion of this income may be subject to state and local income taxes, and if applicable, may subject certain investors to the Alternative Minimum Tax as well. The Near-Term Tax Free Fund may invest up to 20% of its assets in securities that pay taxable interest. Income or fund distributions attributable to capital gains are usually subject to both state and federal income taxes. The Near-Term Tax Free Fund may be exposed to risks related to a concentration of investments in a particular state or geographic area. These investments present risks resulting from changes in economic conditions of the region or issuer.

    Investing in real estate securities involves risks including the potential loss of principal resulting from changes in property value, interest rates, taxes and changes in regulatory requirements.

    Past performance does not guarantee future results.

    Some link(s) above may be directed to a third-party website(s). U.S. Global Investors does not endorse all information supplied by this/these website(s) and is not responsible for its/their content.

    These market comments were compiled using Bloomberg and Reuters financial news.

    Fund portfolios are actively managed, and holdings may change daily. Holdings are reported as of the most recent quarter-end.

    Holdings as a percentage of net assets as of 12/31/14:

    Delta Air Lines, Inc.: Holmes Macro Trends Fund, 1.28%
    Wal-Mart Stores, Inc.: All American Equity Fund, 1.14%
    Boston Scientific Corp.: 0.0%
    Johnson & Johnson: All American Equity Fund, 1.14%
    Celgene Corp.: Holmes Macro Trends Fund, 1.93%
    Biogen Idec, Inc.: Holmes Macro Trends Fund, 2.20%
    Southwest Airlines Co.: 0.0%
    The Boeing Company: 0.0%
    Tesoro Corp.: All American Equity Fund, 1.02%; Global Resources Fund, 1.63%; Holmes Macro Trends Fund, 1.13%
    Exxon Mobil Corp.: All American Equity Fund, 1.14%; Global Resources Fund, 2.84%
    Fossil Group: 0.0%
    Mandalay Resources Corp.: Gold and Precious Metals Fund, 3.38%; World Precious Minerals Fund, 2.28%
    Richmont Mines, Inc.: Gold and Precious Metals Fund, 2.02%; World Precious Minerals Fund, 1.68%
    Timmins Gold Corp.: 0.0%
    Newstrike Capital, Inc.: 0.0%
    Alamos Gold, Inc.: World Precious Minerals Fund, 0.04%
    Osisko Gold Royalties Ltd: 0.0%
    Royal Gold, Inc.: Global Resources Fund, 1.27%; Gold and Precious Metals Fund, 5.99%; World Precious Minerals Fund, 1.51%
    Franco-Nevada Corp.: Gold and Precious Metals Fund, 6.97%; Holmes Macro Trends Fund, 1.59%; World Precious Minerals Fund, 1.32%
    Silver Wheaton Corp.: Gold and Precious Metals Fund, 1.36%; World Precious Minerals Fund, 0.45%
    Klondex Mines Ltd: Global Resources Fund, 1.84%; Gold and Precious Metals Fund, 10.00%; World Precious Minerals Fund, 9.78%
    Barrick Gold Corp.: 0.0%
    Newcrest Mining Ltd: 0.0%
    Sibanye Gold Ltd: 0.0%
    Global X Silver Miners ETF: 0.0%


    *The above-mentioned indices are not total returns. These returns reflect simple appreciation only and do not reflect dividend reinvestment.

    The Dow Jones Industrial Average is a price-weighted average of 30 blue chip stocks that are generally leaders in their industry.
    The S&P 500 Stock Index is a widely recognized capitalization-weighted index of 500 common stock prices in U.S. companies.
    The Nasdaq Composite Index is a capitalization-weighted index of all Nasdaq National Market and SmallCap stocks.
    The Russell 2000 Index® is a U.S. equity index measuring the performance of the 2,000 smallest companies in the Russell 3000®, a widely recognized small-cap index.
    The Hang Seng Composite Index is a market capitalization-weighted index that comprises the top 200 companies listed on Stock Exchange of Hong Kong, based on average market cap for the 12 months.
    The Taiwan Stock Exchange Index is a capitalization-weighted index of all listed common shares traded on the Taiwan Stock Exchange.
    The Korea Stock Price Index is a capitalization-weighted index of all common shares and preferred shares on the Korean Stock Exchanges.
    The Philadelphia Stock Exchange Gold and Silver Index (XAU) is a capitalization-weighted index that includes the leading companies involved in the mining of gold and silver.
    The U.S. Trade Weighted Dollar Index provides a general indication of the international value of the U.S. dollar.
    The S&P/TSX Canadian Gold Capped Sector Index is a modified capitalization-weighted index, whose equity weights are capped 25 percent and index constituents are derived from a subset stock pool of S&P/TSX Composite Index stocks.
    The S&P 500 Energy Index is a capitalization-weighted index that tracks the companies in the energy sector as a subset of the S&P 500.
    The S&P 500 Materials Index is a capitalization-weighted index that tracks the companies in the material sector as a subset of the S&P 500.
    The S&P 500 Financials Index is a capitalization-weighted index. The index was developed with a base level of 10 for the 1941-43 base period.
    The S&P 500 Industrials Index is a Materials Index is a capitalization-weighted index that tracks the companies in the industrial sector as a subset of the S&P 500.
    The S&P 500 Consumer Discretionary Index is a capitalization-weighted index that tracks the companies in the consumer discretionary sector as a subset of the S&P 500.
    The S&P 500 Information Technology Index is a capitalization-weighted index that tracks the companies in the information technology sector as a subset of the S&P 500.
    The S&P 500 Consumer Staples Index is a Materials Index is a capitalization-weighted index that tracks the companies in the consumer staples sector as a subset of the S&P 500.
    The S&P 500 Utilities Index is a capitalization-weighted index that tracks the companies in the utilities sector as a subset of the S&P 500.
    The S&P 500 Healthcare Index is a capitalization-weighted index that tracks the companies in the healthcare sector as a subset of the S&P 500.
    The S&P 500 Telecom Index is a Materials Index is a capitalization-weighted index that tracks the companies in the telecom sector as a subset of the S&P 500.
    The NYSE Arca Gold Miners Index is a modified market capitalization weighted index comprised of publicly traded companies involved primarily in the mining for gold and silver.
    The Consumer Price Index (CPI) is one of the most widely recognized price measures for tracking the price of a market basket of goods and services purchased by individuals. The weights of components are based on consumer spending patterns.
    The Citi Economic Surprise Index measures data surprises relative to market expectations. A positive reading means that data releases have been stronger than expected and a negative reading means that data releases have been worse than expected.
    The Dow Jones STOXX 600 Index is an index of 600 stocks representing large-, mid- and small-capitalization companies in the developed countries of Europe.
    The WIG20 Index is a modified capitalization-weighted index of 20 Polish stocks which are listed on the main market. The index is the underlying instrument for futures transactions listed on the Warsaw Stock Exchange.
    The Bucharest Exchange Trading Index (BET) is a capitalization-weighted index, comprised of the 10 most liquid stocks listed on the DSE tier 1.
    The Borsa Istanbul 100 Index is a capitalization-weighted index composed of National Market companies except investment trusts.
    The University of Michigan Confidence Index is a survey of consumer confidence conducted by the University of Michigan. The report, released on the tenth of each month, gives a snapshot of whether or not consumers are willing to spend money.
    The Consumer Confidence Index (CCI) is an indicator which measures consumer confidence in the economy.
    The Purchasing Manager’s Index is an indicator of the economic health of the manufacturing sector. The PMI index is based on five major indicators: new orders, inventory levels, production, supplier deliveries and the employment environment.
    ZEW Germany Expectation of Economic Growth is a survey on the question of economic growth in six months.
    The Conference Board index of leading economic indicators is an index published monthly by the Conference Board used to predict the direction of the economy's movements in the months to come. The index is made up of 10 economic components, whose changes tend to precede changes in the overall economy.
    The Market Vectors Junior Gold Miners Index is a market-capitalization-weighted index. It covers the largest and most liquid companies that derive at least 50 percent from gold or silver mining or have properties to do so.
    The S&P Supercomposite Oil & Gas Refining & Marketing Index is a capitalization-weighted index.
    The S&P 500 Construction & Engineering Index is a capitalization-weighted index.
    The S&P Supercomposite Packaged Foods Index is a capitalization-weighted index.
    The S&P/TSX Capped Energy Index is a constrained market capitalization-weighted index that consists of Canadian energy sector companies listed on the Toronto Stock Exchange.
    The S&P Supercomposite Oil & Gas Exploration & Production Index is a capitalization-weighted index comprised of stocks whose primary function is exploring for natural gas and oil resources on land or at sea.
    The Bovespa Index, or Ibovespa (IBOV), is a gross total return index weighted by traded volume and is comprised of the most liquid stocks traded on the Sao Paulo Stock Exchange.
    The S&P BSE SENSEX Index is a free-float market-weighted stock market index of 30 well-established and financially sound companies listed on the Bombay Stock Exchange.
    The Jakarta Stock Price Index is a modified capitalization-weighted index of all stocks listed on the regular board of the Indonesia Stock Exchange.
    The Athens Stock Exchange General Index is a capitalization-weighted index of Greek stocks listed on the Athens Stock Exchange.
    The MICEX Index is the real-time cap-weighted Russian composite index. It comprises 30 most liquid stocks of Russian largest and most developed companies from 10 main economy sectors.
    The Indice General de la Bolsa de Valores de Colombia is a liquidity-weighted index of the most liquid stocks traded on the Colombian Stock Exchange.

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    Net Asset Value
    as of 02/26/2015

    Global Resources Fund PSPFX $6.29 -0.06 Gold and Precious Metals Fund USERX $5.70 0.01 World Precious Minerals Fund UNWPX $4.87 0.01 China Region Fund USCOX $8.33 0.06 Emerging Europe Fund EUROX $6.56 -0.09 All American Equity Fund GBTFX $28.65 -0.10 Holmes Macro Trends Fund MEGAX $20.95 -0.03 Near-Term Tax Free Fund NEARX $2.26 No Change China Region Fund USCOX $8.33 0.06