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June 2015

During the second quarter, the Global Resources Fund underperformed its benchmark, the S&P Global Natural Resources Index, by 5.38 percent. See complete fund performance here.

Strengths

  • Superior stock selection in agricultural products and precious metals had a significantly positive contribution to the fund’s performance relative to the benchmark this quarter.
  • The fund’s underweight position in major mining stocks had a positive contribution to the fund relative to the benchmark this quarter.
  • Syngenta AG, an agricultural chemicals company producing crop protection products and seeds, was the single largest contributor to the fund’s performance relative to the benchmark.

Weaknesses

  • Inferior stock selection in the oil refining industry had the largest negative contribution to the fund this quarter.
  • The fund’s underweight position in fertilizers and chemicals had a large negative contribution to the fund’s performance relative to the benchmark this quarter.
  • Atlas Development & Support Services Ltd., and oil and gas services and equipment company, was the single largest negative contributor to the fund’s performance this quarter.

Opportunities

  • PIRA notes that the worst of the oil market imbalance is over and supply overhang should start to shrink. Crude stockpile draws have started and should pick up momentum in 3Q. The longer-term supply/demand fundamentals are bullish.
  • Natural gas futures could strengthen as the outlook for warmer summer temperatures gains momentum among forecasters.
  • With margins expanding and utilization rates trending higher, refiners have been a bright spot in an otherwise gloomy resources space. Their momentum appears to be solid.

Threats

  • A persistent threat to energy stocks, the dollar remains strong. The greenback remains considerably elevated compared to recent history. It appears the dangers of slowing global growth and weaker commodities remain intact.
  • The HSBC China Manufacturing PMI remains below the key 50 percent level, signaling a contraction in the sector. The difficulties facing the manufacturing industries in China could have negative consequences for global commodities.
  • Copper’s retreat from the April high may accelerate this summer if China’s monthly PMI continues to worsen. China consumes approximately 40 percent of the world’s copper supply. 

Performance data quoted above is historical. Past performance is no guarantee of future results. Results reflect the reinvestment of dividends and other earnings. For a portion of periods, the fund had expense limitations, without which returns would have been lower. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than their original cost. Performance does not include the effect of any direct fees described in the fund's prospectus (e.g., short-term trading fees of 0.05%) which, if applicable, would lower your total returns. Performance quoted for periods of one year or less is cumulative and not annualized. Obtain performance data current to the most recent month-end here or by calling 1-800-US-FUNDS.

The S&P Global Natural Resources Index includes 90 of the largest publicly-traded companies in natural resources and commodities businesses that meet specific investability requirements, offering investors diversified, liquid and investable equity exposure across 3 primary commodity-related sectors: Agribusiness, Energy, and Metals & Mining.

The Chinese HSBC Manufacturing PMI is a composite indicator designed to provide an overall view of activity in the manufacturing sector and acts as an leading indicator for the whole economy. When the PMI is below 50.0 this indicates that the manufacturing economy is declining and a value above 50.0 indicates an expansion of the manufacturing economy.

Fund portfolios are actively managed, and holdings may change daily. Holdings are reported as of the most recent quarter-end. Holdings in the Global Resources Fund as a percentage of net assets as of 06/30/2015: Syngenta AG 0.10%, Atlas Development & Support Services Ltd. 2.23%.

Net Asset Value
as of 07/29/2015

Global Resources Fund PSPFX $5.13 0.06 Gold and Precious Metals Fund USERX $4.75 0.06 World Precious Minerals Fund UNWPX $3.93 0.03 China Region Fund USCOX $8.06 0.05 Emerging Europe Fund EUROX $5.86 0.03 All American Equity Fund GBTFX $28.09 0.26 Holmes Macro Trends Fund MEGAX $21.42 0.05 Near-Term Tax Free Fund NEARX $2.24 -0.01 U.S. Government Securities Ultra-Short Bond Fund UGSDX $2.00 -0.01