Fund Central

P

PACIFIC BASIN FUND A fund that invests primarily in the stocks of companies located in the Pacific Basin, which includes Australia, Hong Kong, Japan, Malaysia, New Zealand, Singapore, and Taiwan. PACIFIC EX JAPAN FUNDS A fund that invests primarily in the stocks of companies whose primary trading markets or operations are concentrated in the Pacific region (including Asian countries), and which specifically does not invest in Japan. PAYMENT DATE The day on which a mutual fund pays income dividend or capital gains distributions to its shareholders. PENALTY PLAN A mutual fund accumulation plan in which sales fees for the entire obligation are deducted from shares purchased in the first few years that the plan is in effect. In the event that the investors redeem the shares after a short time, only a small portion of the purchase price will be refunded. Sales charges and penalty plans are regulated by the Investment Company Amendments Act of 1970. PERIODIC PAYMENT PLAN A plan in which an investor agrees to make monthly or quarterly investments in a mutual fund as a method of accumulating shares over a period of years. Fixed periodic contributions result in dollar cost averaging. PERFORMANCE A measure of how well a fund is doing. Two commonly used mutual fund performance measures are yield (which measures dividends) and total return (which measures dividends plus changes in net asset value) over a specified period of time. POOLING Pooling is the basic concept behind mutual funds. A fund pools the money of thousands of individual and institutional investors who share common financial goals. The fund uses this pool to buy a diversified portfolio of investments PORTFOLIO A collection of securities owned by an individual or an institution (like a mutual fund). A fund's portfolio may include a combination of stocks, bonds, and money market securities. PORTFOLIO MANAGER The individual who is responsible for managing a mutual fund's assets. PORTFOLIO TURNOVER A measure of the trading activity in the fund's portfolio of investments. In other words, how often securities are bought and sold. PRECIOUS METALS FUND A fund that seeks an increase in the value of its holdings by investing at least two-thirds of its portfolio in securities associated with gold, silver, and other precious metals. Also known as "gold funds." PREPAYMENT RISK The possibility that, as interest rates fall, homeowners will refinance their home mortgages, resulting in the prepayment of GNMA securities (and other mortgage-backed securities), and possible decline in net asset values of GNMA Funds (and other mortgage-backed securities). PRINCIPAL The basic amount actually invested, exclusive of earnings. PROFESSIONAL MANAGEMENT The pool of shareholder dollars invested in a fund is managed by full-time, experienced professionals who decide which securities to hold, when to buy, and when to sell. PROSPECTUS The official document that describes a mutual fund. It contains information required by the Securities and Exchange Commission on such subjects as the fund's investment objectives, policies, services and fees. A prospectus must be given to every investor. A more detailed document, known as "Part B" of the registration statement, (or "Statement of Additional Information,") is available at no charge upon request.

Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted.