|
|
| Use these links to jump to a section further down the page. |
Fund Description
The Fund seeks to provide long-term growth of capital by investing in the stocks of a broad range of small companies that demonstrate a clear and understandable business strategy, improving fundamentals and strong earnings growth.
top of page ^
Fund Advantages
- Mispriced small company stocks with improving fundamentals can provide capital appreciation.
- A disciplined investment philosophy incorporating quantitative screens and fundamental research can identify attractive stocks, while reducing downside risk.
- A well-diversified portfolio of stocks with attractive fundamentals and strong growth prospects should produce attractive risk-adjusted returns.
top of page ^
|
Fund Returns
|
|
As of August 31, 2010
|
All returns in percentages
|
| Class |
Last
Quarter
06/30/2010
|
Year
to Date
|
1
Year
|
3
Year
|
5
Year
|
10 Years
or Life
of Fund
|
|
A
|
NAV
|
-12.65
|
-6.12
|
13.24
|
-9.41
|
-0.52
|
6.23
|
| |
Inception date: June 26, 2001
|
|
B
|
NAV
|
-12.79
|
-6.42
|
12.60
|
-10.00
|
-1.16
|
5.63
|
| |
Inception date: June 26, 2001
|
|
C
|
NAV
|
-12.73
|
-6.43
|
12.61
|
-10.00
|
-1.15
|
5.56
|
| |
Inception date: June 26, 2001
|
|
Past performance is no guarantee of future results. Investment returns and principal will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. All returns assume the reinvestment of all distributions.
|
top of page ^
|
SEC Returns
|
|
As of June 30, 2010
|
All returns in percentages
|
|
Class
|
|
1
Year
|
5
Year
|
10 Years
or Life
of Fund
|
|
A
|
SEC (A)
|
6.71
|
-1.69
|
5.54
|
|
|
Inception date: June 26, 2001
|
|
B
|
SEC (B)
|
8.60
|
-1.31
|
5.63
|
|
|
Inception date: June 26, 2001
|
|
C
|
SEC (C)
|
12.61
|
-1.15
|
5.56
|
|
|
Inception date: June 26, 2001
|
(A) SEC Returns reflect performance at the maximum 5.75% sales charge applicable to Class A share investments as of 06/30/2010.
(B) A maximum Contingent Deferred Sales Charge (CDSC) of 5% is applied to shares sold prior to the 6th anniversary of purchase. There are also ongoing 12b-1 service and distribution fees. Class B shares automatically convert to class A shares after 8 years.
(C) Class C shares are subject to ongoing 12b-1 service and distribution fees as well as a maximum Contingent Deferred Sales Charge (CDSC) of 1% if you redeem your shares before the first anniversary of your original purchase.
Past performance is no guarantee of future results. Investment returns and principal will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. All returns assume the reinvestment of all distributions.
|
top of page ^
|
Rank
|
Fund
|
Percentage of Portfolio
|
The Fund's portfolio is actively managed and may change significantly over time.
top of page ^
Sector
(Sector groups include many industries)
|
Percentage of Portfolio
|
|
CONSUMER DISCRETIONARY
|
15.50
|
|
INFORMATION TECHNOLOGY
|
13.70
|
The Fund's portfolio is actively managed and may change significantly over time.
top of page ^
|
Class
|
Record
Date
|
Ex Div
Date
|
Invest
Date
|
Payable
Date
|
Reinvest
Price
|
Dividend
|
|
A
|
11-24-2003
|
11-25-2003
|
11-25-2003
|
11-25-2003
|
13.37
|
.12570
|
|
B
|
11-24-2003
|
11-25-2003
|
11-25-2003
|
11-25-2003
|
13.22
|
.07470
|
|
C
|
11-24-2003
|
11-25-2003
|
11-25-2003
|
11-25-2003
|
13.21
|
.08260
|
|
I
|
11-24-2003
|
11-25-2003
|
11-25-2003
|
11-25-2003
|
13.41
|
.15120
|
top of page ^
|
Fund Status
|
Closed to New Investors
|
|
Dividend Frequency
|
Annually
|
|
Number of Issues
|
87
|
|
Class
|
Inception
|
Quotron
|
CUSIP
|
Outstanding
Shares
|
|
A
|
June 26, 2001
|
LSBAX
|
54400M104
|
38,328,667
|
|
B
|
June 26, 2001
|
LSBBX
|
54400M203
|
2,775,411
|
|
C
|
June 26, 2001
|
LSBCX
|
54400M302
|
9,778,668
|
|
F
|
September 28, 2007
|
LBNFX
|
54400M609
|
1,116,659
|
|
I
|
June 26, 2001
|
LSBYX
|
54400M500
|
33,826,549
|
|
R2
|
March 31, 2008
|
LSBQX
|
54400M708
|
58,707
|
|
R3
|
March 31, 2008
|
LSSRX
|
54400M807
|
1,282,641
|
top of page ^
Investment Team
top of page ^
Porfolio Commentary
As of June 30, 2010
Market Review
Among the primary factors that influenced the market in the second quarter were the European sovereign debt crisis, slowing growth in China, and concerns about the strength of the U.S. economic recovery. In response to these, both domestic and foreign investors shifted away from stocks and toward assets perceived as less risky, such as U.S. Treasuries. 1
After the economy posted 3% growth in the first quarter, the expansion showed signs of moderating. Consumer spending, for example, flattened in April after six consecutive months of improvement. In May, retail sales declined 1.7%. Inflation remained subdued, but the unemployment rate stayed between 9.5% and 10.0%. The Federal Reserve kept the fed funds target rate between 0% and 0.25%, explaining that conditions were likely to warrant low rates for an "extended period."
The S&P 500® Index2 reached a 2010 high of 1,217.28 on April 26, but then fell more than 100 points in May, largely due to concerns that the debt crisis in Greece could spread to the rest of Europe and threaten the monetary union. For the quarter, the index lost 11.4%. Declines occurred across all 10 major sectors, but defensive sectors, including telecommunication services and utilities, outperformed the broader market. Value stocks slightly outperformed growth stocks during the period, and small caps outperformed large caps.
Fund Review
The Fund returned -12.65%, reflecting the performance at the net asset value (NAV) of Class A shares, with all distributions reinvested for the quarter ended June 30, 2010, compared to its benchmark, the Russell 2000® Index,3 which returned -9.92% during the same period. Average annual total returns, which reflect performance at the maximum 5.75% sales charge applicable to Class A share investments and include the reinvestment of all distributions, as of June 30, 2010, are: 1 year: 6.71%, 5 years: -1.69%, and since inception (June 26, 2001): 5.54%. Expense ratio: 1.40%
Performance data quoted represent past performance, which is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The investment return and principal value of an investment in the fund will fluctuate so that shares, on any given day or when redeemed, may be worth more or less than their original cost. To obtain performance data current to the most recent month-end, call Lord Abbett at 888-522-2388 or visit us at www.lordabbett.com.
During the second quarter, the Fund was negatively affected by stock selection within the information technology and industrials sectors. Within the information technology sector, Faro Technologies, Inc. (1.2% portfolio weighting), a maker of electrical components and equipment, declined as investors took profits after a strong first quarter report and due to concerns about the company's European business. In the industrials sector, Sykes Enterprises, Inc. (1.7% portfolio weighting), an IT services and consulting company, announced better than estimated revenue for the first quarter, but lowered its full-year guidance. Although the company has experienced wins in some businesses, the technology business has been weak. After Sykes' February merger with ICT Group, the company is still estimating potential synergies. Staffing companies KForce, Inc. (2.1% portfolio weighting) and Robert Half International Inc. (1.4% portfolio weighting) detracted, given ongoing job market uncertainty and continuing recovery of the staffing industry. Within the consumer discretionary sector, shares of the retail clothing company Guess?, Inc. (1.3% portfolio weighting) fell after the May announcement that the company's president and COO, Carlos Alberini, would be leaving the company. Investors also are concerned about the company's southern European exposure.
The Fund benefited from positive stock selection within the health care sector during the second quarter. ICON plc (1.6% portfolio weighting), a contract researching organization in the health care industry, experienced another strong quarter, supported by the announcement of a three-year agreement to support Bristol-Myers Squibb in clinical development. Within the consumer discretionary sector, footwear company Deckers Outdoor Corp. (1.6% portfolio weighting) has seen positive response from their spring/summer line of UGG products. This reaction is expected to help overall UGG sales by increasing presence in stores. In addition, the company has restated its expectation for an increase in revenue over 2009. Within the materials sector, Kraton Performance Polymers (1.2% portfolio weighting), a plastics and rubber chemicals company, benefited from higher than expected sales volume in the first quarter that is expected to continue through the second quarter. During the quarter, sector allocation contributed positively to relative performance, primarily due to an overweight in the industrials sector.
Outlook
While the tone of the global financial markets has turned negative this quarter, we still believe that a continuation of fiscal stimulus, benign monetary policy, and strong corporate cash flows have set the stage for a moderate economic recovery in the United States. Inflation and interest rate pressures will likely begin to manifest themselves as the year progresses. However, we expect these pressures to remain subdued and instead present a positive indication of a more durable economic environment. Near-term economic growth must find another pillar of demand as the benefits from inventory replenishment appear to have run its course. Therefore, strong final demand must be driven by positive impacts from wage increases and the real improvement in corporate earnings. These improvements will manifest themselves in positive stock market action especially in light of the low interest rate environment, which makes fixed-income investments less attractive by comparison. We remain firm in our belief that economic growth will remain below the trend of previous economic cycles, as it will be challenged by relatively high levels of unemployment, high debt levels, and fiscal restraint on the part of consumers and corporations.
The portfolio has significant positions in cyclical industries. These companies should continue to benefit from multiple expansion and improving activity in their end markets. We have increased our holdings of consumer-related companies that will likely benefit from an improvement in consumer spending as employment and personal income start to grow.
1Treasuries are debt securities issued by the U.S. government and secured by its full faith and credit. Income from Treasury securities is exempt from state and local taxes. Although U.S. government securities are guaranteed as to payments of interest and principal, their market prices are not guaranteed and will fluctuate in response to market movements.
2The S&P 500® Index is widely regarded as the standard for measuring large cap U.S. stock market performance and includes a representative sample of leading companies in leading industries.
3The Russell 2000® ?Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index, and represents approximately 8 percent of the total market capitalization of the Russell 3000 Index.
Indexes are unmanaged, do not reflect the deduction of fess or expenses, and are not available for direct investment.
Instances of high double-digit returns were achieved primarily during favorable market conditions and may not be sustainable over time.
The Fund's portfolio is actively managed and, therefore, its holdings and the weightings of a particular issuer or particular sector as a percentage of portfolio assets may change significantly over time. Sectors may include many industries. The mention of specific portfolio holdings is for information only. It does not constitute a recommendation or an offer for a particular security or fund, nor should it be taken as a solicitation or recommendation to buy or sell securities or other investments.
Note: Class A shares purchased subject to a front-end sales charge have no contingent deferred sales charge (CDSC). However, certain purchases of Class A shares made without a front-end sales charge may be subject to a CDSC of 1% if the shares are redeemed before the first day of the month in which the one year anniversary of the purchase falls. Please refer to the prospectus for more information on redemptions that may be subject to a CDSC. The CDSC is not reflected in the average annual total returns. If these charges were included, performance would be lower.
A Note about Risk: The Fund invests in small-company stocks, which tend to be more volatile and can be less liquid than large company stocks. Small cap companies may also have more limited product lines, markets, or financial resources and typically experience higher risk of failure than large cap companies. These factors can affect Fund performance.
The views and information discussed in this commentary are as of June 30, 2010, are subject to change, and may not reflect the views of the firm as a whole. The views expressed in market commentaries are at a specific point in time, are opinions only, and should not be relied upon as a forecast, or research or investment advice regarding a particular investment or the markets in general. Information discussed should not be considered a recommendation to purchase or sell securities.
Investors should carefully consider the investment objectives, risks, charges, and expenses of the Lord Abbett Funds. This and other important information is contained in the fund's summary prospectus and/or prospectus. To obtain a prospectus or summary prospectus on any Lord Abbett mutual fund, contact your investment professional, Lord Abbett Distributor LLC at (888) 522-2388 or visit us at www.lordabbett.com. Read the prospectus carefully before you invest.
top of page ^
Prospectus
You agree to receive the following
prospectus electronically and to read and agree to its terms before investing or sending money. It contains detailed information about the fund's investment policies, risks, charges and expenses. If you would like a reprinted copy of the prospectus, please contact your local Edward Jones investment representative.
The following prospectus is not an offer to sell, or a solicitation of an offer to buy shares in the fund nor shall any such shares be offered or sold to any person in any jurisdiction in which such offer, solicitation, purchase, or sale would be unlawful under the securities laws of such jurisdiction.
top of page ^
|
