The Barclays Municipal 3-Year Bond Index lost 0.25 percent during the month of March while the Near-Term Tax Free Fund lost 0.34 percent. For the quarter, the Barclays Municipal 3-Year Bond Index gained 0.77 percent while the fund gained 0.37 percent. See complete fund performance here.

Municipal bond yields declined during the quarter, which drove prices higher. A higher exposure to cash, given unattractive yields, was a drag on fund performance. As short-term rates rose and longer-term yields declined, the municipal yield curve flattened. As a result, longer-term bonds outperformed.

The front end of the yield curve, in the area with less-than-two-year maturities, had the weakest returns. The fund benefited modestly from its barbell positioning.

Within the main sectors, revenue bonds and general obligations (GOs) outperformed and pre-refunded bonds lagged. Within the revenue subsectors, industrial development, housing, leasing, solid waste/resource recovery and transportation were top performers.

Of the largest states, New Jersey had the best returns for the quarter. Illinois outperformed to a lesser extent, and California lagged slightly. While overall credit fundamentals remain sound, specific issuers were newsworthy. Illinois remained without a state budget, and the impasse continued to pressure state universities and the Chicago Board of Education, among others. Energy-producing states North Dakota, Alaska and Louisiana were downgraded in response to ongoing weakness in oil prices. Draft legislation from the U.S. House of Representatives is set to allow Puerto Rico to restructure some of its $70 billion debt under a federal oversight board, and this legislation should be formally introduced to the U.S. Congress in April.

Generally, lower quality bonds outperformed higher quality during the quarter. Investors' fears about falling commodity prices, a slowing Chinese economy and market volatility abated during the quarter, which led to a greater appetite for risk and allowed lower-rated and longer-maturity bonds to outperform. The fund's large exposure to higher quality bonds was a source of underperformance.

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 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 Barclays 3-Year Municipal Bond Index is a total return benchmark designed for short-term municipal assets. The index includes bonds with a minimum credit rating BAA3, are issued as part of a deal of at least $50 million, have an amount outstanding of at least $5 million and have a maturity of 2 to 4 years.

Net Asset Value
as of 07/27/2016

Global Resources Fund PSPFX $5.56 0.04 Gold and Precious Metals Fund USERX $9.69 0.31 World Precious Minerals Fund UNWPX $8.50 0.23 China Region Fund USCOX $7.30 -0.03 Emerging Europe Fund EUROX $5.39 0.03 All American Equity Fund GBTFX $23.99 -0.21 Holmes Macro Trends Fund MEGAX $18.59 0.08 Near-Term Tax Free Fund NEARX $2.26 No Change U.S. Government Securities Ultra-Short Bond Fund UGSDX $2.01 No Change