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Ab Variable Products Series Fund

Filed: 22 Feb 21, 11:04am

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

FORM N-CSR

 

 

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number: 811-05398

 

 

 

AB VARIABLE PRODUCTS SERIES FUND, INC.

(Exact name of registrant as specified in charter)

 

 

1345 Avenue of the Americas, New York, New York 10105

(Address of principal executive offices) (Zip code)

 

 

Joseph J. Mantineo

AllianceBernstein L.P.

1345 Avenue of the Americas

New York, New York 10105

(Name and address of agent for service)

 

 

Registrant’s telephone number, including area code: (800) 221-5672

Date of fiscal year end: December 31, 2020

Date of reporting period: December 31, 2020

 

 

 


ITEM 1.

REPORTS TO STOCKHOLDERS.


DEC    12.31.20

 

LOGO

 

ANNUAL REPORT

AB VARIABLE PRODUCTS

SERIES FUND, INC.

 

+ 

BALANCED WEALTH STRATEGY PORTFOLIO

 

Beginning on May 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, you may not be receiving paper copies of the Portfolio’s shareholder reports from the insurance company that offers your contract unless you specifically request paper copies from the insurance company or from your financial intermediary. Instead of delivering paper copies of the reports, the insurance company may choose to make the reports available on a website, and will notify you by mail each time a report is posted and provide you with a website link to access the report. Instructions for requesting paper copies will be provided by your insurance company.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the insurance company or your financial intermediary electronically by following the instructions provided by the insurance company or by contacting your financial intermediary.

You may elect to receive all future reports in paper free of charge from the insurance company. You can inform the insurance company or your financial intermediary that you wish to continue receiving paper copies of your shareholder reports by following the instructions provided by the insurance company or by contacting your financial intermediary. Your election to receive reports in paper will apply to all portfolio companies available under your contract with the insurance company.


 

 

 

Investment Products Offered

 

  

Are Not FDIC Insured

  

May Lose Value

  

Are Not Bank Guaranteed

AllianceBernstein Investments, Inc. (ABI) is the distributor of the AB family of mutual funds. ABI is a member of FINRA and is an affiliate of AllianceBernstein L.P., the Adviser of the funds.

You may obtain a description of the Fund’s proxy voting policies and procedures, and information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30, without charge. Simply visit AB’s website at www.abfunds.com or go to the Securities and Exchange Commission’s (the “Commission”) website at www.sec.gov, or call AB at (800) 227 4618.

The Fund files its complete schedule of portfolio holdings with the Commission for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Form N-PORT reports are available on the Commission’s website at www.sec.gov. The Fund’s Forms N-PORT may also be reviewed and copied at the Commission’s Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC 0330.

The [A/B] logo is a registered service mark of AllianceBernstein and AllianceBernstein® is a registered service mark used by permission of the owner, AllianceBernstein L.P.


 
BALANCED WEALTH STRATEGY 
PORTFOLIO AB Variable Products Series Fund

 

LETTER TO INVESTORS

February 12, 2021

The following is an update of AB Variable Products Series Fund—Balanced Wealth Strategy Portfolio (the “Portfolio”) for the annual reporting period ended December 31, 2020.

INVESTMENT OBJECTIVE AND POLICIES

The Portfolio’s investment objective is to maximize total return consistent with the Adviser’s determination of reasonable risk. The Portfolio invests in a portfolio of equity and fixed-income securities that is designed as a solution for investors who seek a moderate tilt toward equity returns but also want the risk diversification offered by fixed-income securities and the broad diversification of their equity risk across styles, capitalization ranges and geographic regions. Under normal circumstances, the Portfolio invests at least 25% of its total assets in equity securities and at least 25% of its total assets in fixed-income securities with a goal of providing moderate upside potential without excessive volatility. The Portfolio also seeks exposure to real assets by investing in real estate-related equity securities (including real estate investment trusts “REITs”), natural resource equity securities and inflation-sensitive equity securities, which are equity securities of companies that the Adviser believes maintain or grow margins in rising inflation environments, including equity securities of utilities and infrastructure-related companies (“inflation-sensitive equities”). The Portfolio pursues a global strategy, typically investing in securities of issuers located in the United States and in other countries throughout the world, including emerging-market countries.

The Adviser expects that the Portfolio will normally invest a greater percentage of its total assets in equity securities than in fixed-income securities, and will generally invest in equity securities both directly and through underlying investment companies advised by the Adviser (“Underlying Portfolios”). A significant portion of the Portfolio’s assets are expected to be invested directly in US large-cap equity securities, primarily common stocks, in accordance with the Adviser’s US Strategic Equities investment strategy (“US Strategic Equities”). Under US Strategic Equities, portfolio managers of the Adviser that specialize in various investment disciplines identify high-conviction large-cap equity securities based on their fundamental investment research for potential investment by the Portfolio. These securities are then assessed in terms of both this fundamental research and quantitative analysis in creating the equity portion of the Portfolio’s portfolio. In applying the quantitative analysis, the Adviser considers a number of metrics that historically have provided some indication of favorable future returns, including metrics related to valuation, quality, investor behavior and corporate behavior.

In addition, the Portfolio seeks to achieve exposure to international large-cap equity securities through investments in other registered investment companies advised by the Adviser, which may include International Strategic Equities Portfolio of Bernstein Fund, Inc. (“Bernstein International Strategic Equities Portfolio”). Bernstein International Strategic Equities Portfolio focuses on investing in non-US large-cap and mid-cap equity securities. Bernstein International Strategic Equities Portfolio follows a strategy similar to US Strategic Equities, but in the international context. The Portfolio also invests in other Underlying Portfolios to efficiently gain exposure to certain other types of equity securities, including small- and mid-cap and emerging-market equity securities. The Adviser selects an Underlying Portfolio based on the segment of the equity market to which the Underlying Portfolio provides exposure, its investment philosophy, and how it complements and diversifies the Portfolio’s overall portfolio.

In selecting fixed-income investments, the Adviser may draw on the capabilities of separate investment teams that specialize in different areas that are generally defined by the maturity of the debt securities and/or their ratings, and which may include subspecialties (such as inflation-indexed securities). These fixed-income teams draw on the resources and expertise of the Adviser’s internal fixed-income research staff, which includes over 50 dedicated fixed-income research analysts and economists. The Portfolio’s fixed-income securities will primarily be investment-grade debt securities, but are expected to include lower-rated securities (“junk bonds”) and preferred stock.

The Portfolio expects to enter into derivative transactions, such as options, futures contracts, forwards and swaps. Derivatives may provide a more efficient and economical exposure to market segments than direct investments, and may also be a more efficient way to alter the Portfolio’s exposure. The Portfolio may, for example, use credit default, interest rate and total return swaps to establish exposure to the fixed-income markets or particular fixed-income securities and, as noted below, may use currency derivatives to hedge foreign currency exposure.

The Adviser may employ currency hedging strategies in the Portfolio or the Underlying Portfolios, including the use of currency-related derivatives, to seek to reduce currency risk in the Portfolio or the Underlying Portfolios, but it is not required to do so. The Adviser will generally

 

1


  AB Variable Products Series Fund

 

employ currency-related hedging strategies more frequently in the fixed-income portion of the Portfolio than in the equity portion.

INVESTMENT RESULTS

The table on page 5 shows the Portfolio’s performance compared to its primary benchmark, the Morgan Stanley Capital International All Country World Index (“MSCI ACWI”) (net), and the Bloomberg Barclays Global Aggregate Bond Index (USD hedged), for the one-, five- and 10-year periods ended December 31, 2020.

For the annual period, all share classes of the Portfolio underperformed the primary benchmark, but outperformed the Bloomberg Barclays Global Aggregate Bond Index. The Portfolio’s more diversified approach, which balances exposures to equities, bonds, commodities and alternative strategies, underperformed the all-equity benchmark. During the period, equities, fixed-income assets and alternative strategies contributed to absolute performance. Security selection within equities and fixed income detracted from performance, while selection within alternative strategies was positive.

During the annual period, the Portfolio utilized derivatives for hedging and investment purposes, including futures and written swaptions, which added to absolute returns, while forwards, credit default swaps, interest rate swaps and inflation Consumer Price Index swaps detracted.

MARKET REVIEW AND INVESTMENT STRATEGY

US and international stocks recorded positive returns during the annual period ended December 31, 2020, erasing losses from lows reached in late March when the COVID-19 pandemic triggered a sharp decline. During the early stages of the recovery, global economies rebounded from record GDP contractions, supported by extensive monetary and fiscal stimulus, expedited vaccine development, and improving economic data. Favorable news about the efficacy of coronavirus vaccination candidates helped offset market volatility prompted by an inability to control the spread of the virus in many countries, a potentially contested US presidential election and lack of additional US fiscal stimulus. At the end of the period—despite surging infection rates and the emergence of a seemingly more transmissible strain of the virus—optimism over the start of vaccine distribution, clarity following the US elections, and passage of both a US relief package and a post-Brexit trade deal fueled a broad-based rally. For the annual period, large-cap stocks, led by US technology companies, narrowly outperformed small-cap stocks, while growth stocks outperformed value stocks significantly in both the large- and small-cap categories.

Global fixed-income market returns were positive yet volatile over the annual period. Central banks and governments enacted an unprecedented amount of monetary and fiscal stimulus to combat market illiquidity and cushion the negative economic impact of COVID-19, setting the stage for a rebound in risk assets following the initial sell-off in March. Government bonds rallied as interest rates were slashed. Risk assets began to rally significantly in November when positive vaccine news extended the credit rally. Developed-market and emerging-market investment-grade corporate bonds and commercial mortgage-backed securities led gains as investors searched for higher yields in a period of falling interest rates. Global developed-market high-yield corporate bonds also had strong returns, particularly in the US. Agency mortgage-backed securities, along with emerging-market local-currency debt and high-yield hard-currency sovereign bonds, had positive returns but trailed global treasuries. The US dollar declined against all major developed-market currencies and was mixed against emerging-market currencies. Brent crude oil prices were volatile and fell about 21% due to an uncertain oil industry outlook. Copper prices advanced more than 25%, and gold rose 24% as a perceived inflation hedge.

The Portfolio’s Senior Investment Management Team seeks improved equity risk control by utilizing a blend of US, emerging- and international-market equities as well as diversifiers in the form of real estate, natural resources and pricing power equities. The Portfolio also features a global fixed-income component to benefit from international bond diversification and the low correlation of fixed income and equities. The blended equity and fixed-income exposures, combined with an emphasis on companies with historical and projected stable earnings and higher profitability, offer the potential to achieve higher risk-adjusted returns.

 

2


 
BALANCED WEALTH STRATEGY PORTFOLIO
DISCLOSURES AND RISKS AB Variable Products Series Fund

 

Benchmark Disclosure

All indices are unmanaged and do not reflect fees and expenses associated with the active management of a mutual fund portfolio. The MSCI ACWI (net, free float-adjusted, market capitalization weighted) represents the equity market performance of developed and emerging markets. The Bloomberg Barclays Global Aggregate Bond Index (USD hedged) represents the performance of the global investment-grade developed fixed-income markets, hedged to the US dollar. MSCI makes no express or implied warranties or representations, and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indices, any securities or financial products. This report is not approved, reviewed or produced by MSCI. Net returns reflect the reinvestment of dividends after deduction of non-US withholding tax. An investor cannot invest directly in an index, and its results are not indicative of the performance for any specific investment, including the Portfolio.

A Word About Risk

Market Risk: The value of the Portfolio’s assets will fluctuate as the stock or bond market fluctuates. The value of its investments may decline, sometimes rapidly and unpredictably, simply because of economic changes or other events, including public health crises (including the occurrence of a contagious disease or illness), that affect large portions of the market.

Allocation Risk: The allocation of investments among the different investment styles, such as growth or value, equity or debt securities, or US or non-US securities may have a more significant effect on the Portfolio’s net asset value (“NAV”) when one of these investment strategies is performing more poorly than others.

Foreign (Non-US) Risk: Investments in securities of non-US issuers may involve more risk than those of US issuers. These securities may fluctuate more widely in price and may be more difficult to trade due to adverse market, economic, political, regulatory or other factors.

Emerging-Market Risk: Investments in emerging-market countries may have more risk because the markets are less developed and less liquid, and because these investments may be subject to increased economic, political, regulatory or other uncertainties.

Currency Risk: Fluctuations in currency exchange rates may negatively affect the value of the Portfolio’s investments or reduce the Portfolio’s returns.

Interest-Rate Risk: Changes in interest rates will affect the value of investments in fixed-income securities. When interest rates rise, the value of existing investments in fixed-income securities tends to fall and this decrease in value may not be offset by higher income from new investments. Interest-rate risk is generally greater for fixed-income securities with longer maturities or durations.

Credit Risk: An issuer or guarantor of a fixed-income security, or the counterparty to a derivatives or other contract, may be unable or unwilling to make timely payments of interest or principal, or to otherwise honor its obligations. The issuer or guarantor may default, causing a loss of the full principal amount of a security and accrued interest. The degree of risk for a particular security may be reflected in its credit rating. There is the possibility that the credit rating of a fixed-income security may be downgraded after purchase, which may adversely affect the value of the security.

Below Investment-Grade Security Risk: Investments in fixed-income securities with lower ratings (“junk bonds”) tend to have a higher probability that an issuer will default or fail to meet its payment obligations. These securities may be subject to greater price volatility due to such factors as specific corporate developments, interest-rate sensitivity and negative perceptions of the junk bond market generally, and may be more difficult to trade than other types of securities.

Capitalization Risk: Investments in small- and mid-capitalization companies may be more volatile than investments in large-capitalization companies. Investments in small- and mid-capitalization companies may have additional risks because these companies have limited product lines, markets or financial resources.

Investment in Other Investment Companies Risk: As with other investments, investments in other investment companies are subject to market and selection risk. In addition, Contractholders invested in the Portfolio bear both their proportionate share of expenses in the Portfolio (including management fees) and, indirectly, the expenses of the investment companies in which the Portfolio invests (to the extent these expenses are not waived or reimbursed by the Adviser).

 

 

(Disclosures, Risks and Note About Historical Performance continued on next page)

 

3


 
DISCLOSURES AND RISKS 
(continued) AB Variable Products Series Fund

 

Derivatives Risk: Derivatives may be difficult to price or unwind and leveraged so that small changes may produce disproportionate losses for the Portfolio. Derivatives, especially over-the-counter derivatives, are also subject to counterparty risk.

Real Assets Risk: The Portfolio’s investments in securities linked to real assets involve significant risks, including financial, operating, and competitive risks. Investments in securities linked to real assets expose the Portfolio to adverse macroeconomic conditions, such as a rise in interest rates or a downturn in the economy in which the asset is located. Changes in inflation rates or in the market’s inflation expectations may adversely affect the market value of inflation-sensitive equities. The Portfolio’s investments in real estate securities have many of the same risks as direct ownership of real estate, including the risk that the value of real estate could decline due to a variety of factors that affect the real estate market generally. Investments in REITs may have additional risks. REITs are dependent on the capability of their managers, may have limited diversification, and could be significantly affected by changes in tax laws.

Active Trading Risk: The Portfolio expects to engage in active and frequent trading of its portfolio securities and its portfolio turnover rate is expected to exceed 100%. A higher rate of portfolio turnover increases transaction costs, which may negatively affect the Portfolio’s return.

Management Risk: The Portfolio is subject to management risk because it is an actively managed investment fund. The Adviser will apply its investment techniques and risk analyses in making investment decisions for the Portfolio, but there is no guarantee that its techniques will produce the intended results. Some of these techniques may incorporate, or rely upon, quantitative models, but there is no guarantee that these models will generate accurate forecasts, reduce risk or otherwise perform as expected.

These risks are fully discussed in the Variable Products prospectus. As with all investments, you may lose money by investing in the Portfolio.

An Important Note About Historical Performance

The investment return and principal value of an investment in the Portfolio will fluctuate, so that shares, when redeemed, may be worth more or less than their original cost. Performance shown in this report represents past performance and does not guarantee future results. Current performance may be lower or higher than the performance information shown. Please contact your financial advisor or insurance agent representative at your financial institution to obtain portfolio performance information current to the most recent month-end.

Effective May 1, 2018, the Portfolio amended its principal strategies by eliminating the static targets for allocation of investments among asset classes, changing the securities selection strategies used for the equity portion of the Portfolio, and broadening the types of real asset securities in which the Portfolio will invest. The performance shown in the report for periods prior to May 1, 2018 is based on the Portfolio’s prior principal strategies and may not be representative of the Portfolio’s performance under its current principal strategies.

Investors should consider the investment objectives, risks, charges and expenses of the Portfolio carefully before investing. For additional copies of the Portfolio’s prospectus or summary prospectus, which contains this and other information, call your financial advisor or (800) 227 4618. Please read the prospectus and/or summary prospectus carefully before investing.

All fees and expenses related to the operation of the Portfolio have been deducted, but no adjustment has been made for insurance company separate account or annuity contract charges, which would reduce total return to a contract owner. Performance assumes reinvestment of distributions and does not account for taxes.

There are additional fees and expenses associated with all Variable Products. These fees can include mortality and expense risk charges, administrative charges, and other charges that can significantly reduce investment returns. Those fees and expenses are not reflected in this annual report. You should consult your Variable Products prospectus for a description of those fees and expenses and speak to your insurance agent or financial representative if you have any questions. You should read the prospectus before investing or sending money.

 

4


 
BALANCED WEALTH STRATEGY PORTFOLIO
HISTORICAL PERFORMANCE AB Variable Products Series Fund

 

 

          
THE PORTFOLIO VS. ITS BENCHMARKS  Net Asset Value Returns 
PERIODS ENDED DECEMBER 31, 2020 (unaudited)  1 Year     5 Years1     10 Years1 
Balanced Wealth Strategy Portfolio Class A   9.41%      8.09%      7.56% 
Balanced Wealth Strategy Portfolio Class B   9.25%      7.85%      7.30% 
Primary Benchmark: MSCI ACWI (net)   16.25%      12.26%      9.13% 
Bloomberg Barclays Global Aggregate Bond Index (USD hedged)   5.58%      4.49%      4.18% 

1   Average annual returns.

          
          

The Portfolio’s current prospectus fee table shows the Portfolio’s total annual operating expense ratios as 0.97% and 1.22% for Class A and Class B shares, respectively, gross of any fee waivers or expense reimbursements. Contractual fee waivers and/or expense reimbursements limit the Portfolio’s annual operating expense ratios exclusive of interest expense to 0.76% and 1.01% for Class A and Class B shares, respectively. These waivers/reimbursements may not be terminated before May 1, 2021, and may be extended by the Adviser for additional one-year terms. The Financial Highlights section of this report sets forth expense ratio data for the current reporting period; the expense ratios shown above may differ from the expense ratios in the Financial Highlights section since they are based on different time periods.

GROWTH OF A $10,000 INVESTMENT

12/31/2010 to 12/31/2020 (unaudited)

 

LOGO

This chart illustrates the total value of an assumed $10,000 investment in Balanced Wealth Strategy Portfolio Class A shares (from 12/31/2010 to 12/31/2020) as compared to the performance of the Portfolio’s benchmarks. The chart assumes the reinvestment of dividends and capital gains distributions.

 

 

 

See Disclosures, Risks and Note About Historical Performance on pages 3-4.

 

5


 
BALANCED WEALTH STRATEGY PORTFOLIO
EXPENSE EXAMPLE (unaudited) AB Variable Products Series Fund

 

As a shareholder of the Portfolio, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, contingent deferred sales charges on redemptions and (2) ongoing costs, including management fees; distribution (12b-1) fees; and other Portfolio expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Portfolio and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period as indicated below.

Actual Expenses

The table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. The estimate of expenses does not include fees or other expenses of any variable insurance product. If such expenses were included, the estimate of expenses you paid during the period would be higher and your ending account value would be lower.

Hypothetical Example for Comparison Purposes

The table below provides information about hypothetical account values and hypothetical expenses based on the Portfolio’s actual expense ratio and an assumed annual rate of return of 5% before expenses, which is not the Portfolio’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Portfolio and other funds by comparing this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. The estimate of expenses does not include fees or other expenses of any variable insurance product. If such expenses were included, the estimate of expenses you paid during the period would be higher and your ending account value would be lower.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), or contingent deferred sales charges on redemptions. Therefore, the second line of each class’ table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

 

   Beginning
Account Value
July 1, 2020
  Ending
Account Value
December 31, 2020
  Expenses Paid
During Period*
  Annualized
Expense Ratio*
  Total
Expenses Paid
During Period+
  Total
Annualized
Expense Ratio+
 

Class A

      

Actual

 $  1,000  $  1,153.90  $  2.98   0.55 $  4.17   0.77

Hypothetical (5% annual return before expenses)

 $1,000  $1,022.37  $2.80   0.55 $3.91   0.77
      

Class B

      

Actual

 $1,000  $1,153.00  $4.33   0.80 $5.52   1.02

Hypothetical (5% annual return before expenses)

 $1,000  $1,021.11  $4.06   0.80 $5.18   1.02

 

 

 

* Expenses are equal to each classes’ annualized expense ratios, multiplied by the average account value over the period, multiplied by 184/366 (to reflect the one-half year period).

 

+ In connection with the Portfolio’s investments in affiliated/unaffiliated underlying portfolios, the Portfolio incurs no direct expenses, but bears proportionate shares of the fees and expenses (i.e., operating, administrative and investment advisory fees) of the affiliated/unaffiliated underlying portfolios. The Adviser has contractually agreed to waive its fees from the Portfolio in an amount equal to the Portfolio’s pro rata share of certain acquired fund fees and expenses of the affiliated underlying portfolios. The Portfolio’s total expenses are equal to the classes’ annualized expense ratio plus the Portfolio’s pro rata share of the weighted average expense ratio of the affiliated/unaffiliated underlying portfolios in which it invests, multiplied by the average account value over the period, multiplied by 184/366 (to reflect the one-half year period).

 

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BALANCED WEALTH STRATEGY PORTFOLIO
TEN LARGEST HOLDINGS1 
December 31, 2020 (unaudited) AB Variable Products Series Fund

 

 

SECURITY  U.S. $  VALUE                      PERCENT OF NET ASSETS 

Bernstein Fund, Inc.—International Strategic Equities Portfolio—Class Z

  $42,917,274    17.6

Bernstein Fund, Inc.—International Small Cap Portfolio—Class Z

   8,409,829    3.5 

Microsoft Corp.

   5,297,155    2.2 

Sanford C. Bernstein Fund, Inc.—Emerging Markets Portfolio—Class Z

   3,964,568    1.6 

Alphabet, Inc.—Class C

   3,799,828    1.6 

Apple, Inc.

   3,775,030    1.5 

AB Trust—AB Discovery Value Fund—Class Z

   3,151,209    1.3 

Bernstein Fund, Inc.—Small Cap Core Portfolio—Class Z

   3,104,771    1.3 

AB Discovery Growth Fund, Inc.—Class Z

   3,073,324    1.3 

Facebook, Inc.—Class A

   2,799,344    1.1 
   

 

 

   

 

 

 
   $  80,292,332    33.0

SECURITY TYPE BREAKDOWN2

December 31, 2020 (unaudited)

 

 

SECURITY TYPE  U.S. $  VALUE   PERCENT OF  TOTAL INVESTMENTS 

Common Stocks

  $98,736,230    40.4

Investment Companies

   64,620,975    26.4 

Governments—Treasuries

   29,076,965    11.9 

Corporates—Investment Grade

   22,792,366    9.3 

Corporates—Non-Investment Grade

   5,221,377    2.1 

Quasi-Sovereigns

   4,419,286    1.8 

Collateralized Mortgage Obligations

   3,785,675    1.6 

Mortgage Pass-Throughs

   3,765,978    1.5 

Commercial Mortgage-Backed Securities

   2,093,375    0.9 

Emerging Markets—Corporate Bonds

   927,177    0.4 

Collateralized Loan Obligations

   868,963    0.4 

Governments—Sovereign Bonds

   717,277    0.3 

Emerging Markets—Sovereigns

   709,046    0.3 

Other3

   1,321,012    0.5 

Short-Term Investments

   5,356,003    2.2 
   

 

 

   

 

 

 

Total Investments

  $  244,411,705    100.0

 

 

 

 

1 Long-term investments. Table shown includes investments of Underlying Portfolios.

 

2 The Portfolio’s security type breakdown is expressed as a percentage of total investments and may vary over time. The Portfolio also enters into derivative transactions, which may be used for hedging or investment purposes (see “Portfolio of Investments” section of the report for additional details). Table shown includes investments of Underlying Portfolios.

 

3 “Other” represents less than 0.2% weightings in the following security types: Asset-Backed Securities, Covered Bonds, Emerging Markets—Treasuries and Governments—Sovereign Agencies.

 

7


BALANCED WEALTH STRATEGY PORTFOLIO
COUNTRY BREAKDOWN1 
December 31, 2020 (unaudited) AB Variable Products Series Fund

 

 

COUNTRY  U.S. $  VALUE   PERCENT OF  TOTAL INVESTMENTS 

United States

  $173,238,750    70.9

Japan

   10,631,602    4.3 

United Kingdom

   6,654,392    2.7 

China

   5,803,880    2.4 

Australia

   5,678,242    2.3 

Canada

   5,068,661    2.1 

Italy

   3,189,197    1.3 

Switzerland

   2,862,351    1.2 

France

   2,832,149    1.2 

Germany

   2,674,319    1.1 

Netherlands

   2,585,257    1.1 

Spain

   2,064,490    0.8 

Ireland

   2,025,997    0.8 

Other

   13,746,415    5.6 

Short-Term Investments

   5,356,003    2.2 
   

 

 

   

 

 

 

Total Investments

  $  244,411,705    100.0

 

 

1 All data are as of December 31, 2020. The Portfolio’s country breakdown is expressed as a percentage of total investments (excluding security lending collateral) and may vary over time. Table shown includes investments of Underlying Portfolios. “Other” country weightings represent 0.6% or less in the following: Austria, Belgium, Brazil, Chile, Colombia, Denmark, Finland, Greece, Hong Kong, India, Indonesia, Israel, Ivory Coast, Jersey (Channel Islands), Luxembourg, Malaysia, Mexico, New Zealand, Nigeria, Norway, Panama, Peru, Portugal, Russia, Saudi Arabia, Singapore, South Africa, Sweden, Turkey, United Arab Emirates and United Republic of Tanzania.

 

8


BALANCED WEALTH STRATEGY PORTFOLIO
PORTFOLIO OF INVESTMENTS 
December 31, 2020 AB Variable Products Series Fund

 

    
    
    
Company
 Shares  U.S. $ Value 
                                          

COMMON STOCKS–40.5%

  
  

INFORMATION TECHNOLOGY–9.4%

  

COMMUNICATIONS EQUIPMENT–0.0%

  

Telefonaktiebolaget LM Ericsson–Class B

  1,571  $18,688 
  

 

 

 

ELECTRONIC EQUIPMENT, INSTRUMENTS & COMPONENTS–0.3%

  

Arrow Electronics, Inc.(a)

  874   85,040 

CDW Corp./DE

  4,758   627,057 
  

 

 

 
   712,097 
  

 

 

 

IT SERVICES–2.1%

  

Accenture PLC–Class A

  151   39,443 

Atos SE(a)

  347   31,686 

Automatic Data Processing, Inc.

  4,163   733,520 

Booz Allen Hamilton Holding Corp.

  4,699   409,659 

EPAM Systems, Inc.(a)

  236   84,571 

Genpact Ltd.

  13,178   545,042 

International Business Machines Corp.

  168   21,148 

Mastercard, Inc.–Class A

  204   72,816 

PayPal Holdings, Inc.(a)

  4,024   942,421 

Shopify, Inc.–Class A(a)

  49   55,329 

Visa, Inc.–Class A

  10,123   2,214,204 
  

 

 

 
   5,149,839 
  

 

 

 

SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT–2.1%

  

Advanced Micro Devices, Inc.(a)

  284   26,046 

Applied Materials, Inc.

  1,108   95,620 

ASML Holding NV

  139   67,301 

Lam Research Corp.

  32   15,113 

NVIDIA Corp.

  1,479   772,334 

NXP Semiconductors NV

  6,034   959,466 

QUALCOMM, Inc.

  9,188   1,399,699 

STMicroelectronics NV

  1,641   60,710 

Teradyne, Inc.

  194   23,259 

Texas Instruments, Inc.

  6,886   1,130,199 

Xilinx, Inc.

  4,488   636,264 
  

 

 

 
   5,186,011 
  

 

 

 

SOFTWARE–3.3%

  

Adobe, Inc.(a)

  1,097   548,632 

Autodesk, Inc.(a)

  22   6,717 

Cadence Design Systems, Inc.(a)

  742   101,231 

Citrix Systems, Inc.

  4,648   604,705 

Constellation Software, Inc./Canada

  28   36,359 

Dropbox, Inc.–Class A(a)

  1,871   41,517 

Fair Isaac Corp.(a)

  67   34,240 

Intuit, Inc.

  65   24,690 

Microsoft Corp.

  23,816   5,297,155 
                                          

Oracle Corp.

  13,182  852,744 

ServiceNow, Inc.(a)

  188   103,481 

Topicus.com, Inc.(a)(b)(c)

  52   197 

Trend Micro, Inc./Japan

  800   46,058 

VMware, Inc.–Class A(a)(d)

  2,741   384,453 

WiseTech Global Ltd.

  151   3,588 

Xero Ltd.(a)

  176   19,976 

Zoom Video Communications, Inc.–Class A(a)

  35   11,806 
  

 

 

 
   8,117,549 
  

 

 

 

TECHNOLOGY HARDWARE, STORAGE & PERIPHERALS–1.6%

  

Apple, Inc.

  28,450   3,775,030 
  

 

 

 
   22,959,214 
  

 

 

 

HEALTH CARE–4.9%

  

BIOTECHNOLOGY–0.6%

  

AbbVie, Inc.

  828   88,720 

Amgen, Inc.

  100   22,992 

Regeneron Pharmaceuticals, Inc.(a)

  805   388,904 

Vertex Pharmaceuticals, Inc.(a)

  3,955   934,724 
  

 

 

 
   1,435,340 
  

 

 

 

HEALTH CARE EQUIPMENT & SUPPLIES–1.0%

  

Align Technology, Inc.(a)

  67   35,803 

Edwards Lifesciences Corp.(a)

  9,002   821,253 

Medtronic PLC

  13,797   1,616,181 
  

 

 

 
   2,473,237 
  

 

 

 

HEALTH CARE PROVIDERS & SERVICES–1.5%

  

AmerisourceBergen Corp.–Class A

  681   66,575 

Anthem, Inc.

  3,359   1,078,541 

McKesson Corp.

  376   65,394 

Molina Healthcare, Inc.(a)

  280   59,550 

UnitedHealth Group, Inc.

  6,681   2,342,893 
  

 

 

 
   3,612,953 
  

 

 

 

HEALTH CARE TECHNOLOGY–0.0%

  

Cerner Corp.

  1,009   79,186 

Veeva Systems, Inc.–Class A(a)

  107   29,131 
  

 

 

 
   108,317 
  

 

 

 

LIFE SCIENCES TOOLS & SERVICES–0.1%

  

Bio-Rad Laboratories, Inc.–Class A(a)

  124   72,284 

Lonza Group AG

  17   10,951 

Mettler-Toledo International, Inc.(a)

  66   75,219 

Sartorius Stedim Biotech

  119   42,334 

Waters Corp.(a)

  91   22,515 
  

 

 

 
   223,303 
  

 

 

 

 

9


BALANCED WEALTH STRATEGY PORTFOLIO
PORTFOLIO OF INVESTMENTS 
(continued) AB Variable Products Series Fund

 

    
    
    
Company
 Shares  U.S. $ Value 
                                          

PHARMACEUTICALS–1.7%

  

AstraZeneca PLC

  195  $19,444 

Eli Lilly & Co.

  539   91,005 

Johnson & Johnson

  8,577   1,349,848 

Merck & Co., Inc.

  641   52,434 

Novo Nordisk A/S–Class B

  688   47,994 

Roche Holding AG

  223   77,671 

Roche Holding AG (Sponsored ADR)

  31,594   1,385,081 

Takeda Pharmaceutical Co., Ltd.

  1,900   68,760 

Zoetis, Inc.

  5,683   940,536 
  

 

 

 
   4,032,773 
  

 

 

 
   11,885,923 
  

 

 

 

COMMUNICATION SERVICES–4.5%

  

DIVERSIFIED TELECOMMUNICATION SERVICES–1.1%

  

Comcast Corp.–Class A

  29,540   1,547,896 

Telenor ASA

  1,727   29,315 

Verizon Communications, Inc.

  17,313   1,017,139 
  

 

 

 
   2,594,350 
  

 

 

 

ENTERTAINMENT–0.6%

  

Electronic Arts, Inc.

  9,007   1,293,405 

Netflix, Inc.(a)

  240   129,776 

Nintendo Co., Ltd.

  100   64,194 
  

 

 

 
   1,487,375 
  

 

 

 

INTERACTIVE MEDIA & SERVICES–2.8%

  

Alphabet, Inc.–Class A(a)

  79   138,458 

Alphabet, Inc.–Class C(a)

  2,169   3,799,828 

Facebook, Inc.–Class A(a)

  10,248   2,799,344 
  

 

 

 
   6,737,630 
  

 

 

 

WIRELESS TELECOMMUNICATION SERVICES–0.0%

  

Softbank Corp.

  2,200   27,614 
  

 

 

 
   10,846,969 
  

 

 

 

REAL ESTATE–4.2%

  

DIVERSIFIED REAL ESTATE ACTIVITIES–0.2%

  

Mitsubishi Estate Co., Ltd.

  3,800   61,077 

Mitsui Fudosan Co., Ltd.

  10,400   217,771 

New World Development Co., Ltd.

  16,000   74,438 

Sumitomo Realty & Development Co., Ltd.

  1,300   40,135 

Sun Hung Kai Properties Ltd.

  11,000   140,679 

UOL Group Ltd.

  7,700   44,899 
  

 

 

 
   578,999 
  

 

 

 

DIVERSIFIED REITS–0.3%

  

Alexander & Baldwin, Inc.

  3,260   56,007 

Armada Hoffler Properties, Inc.

  3,732   41,873 
                                          

Broadstone Net Lease, Inc.–Class A

  1,660  32,503 

Daiwa House REIT Investment Corp.

  14   34,634 

Essential Properties Realty Trust, Inc.

  3,604   76,405 

Fibra Uno Administracion SA de CV

  13,590   15,373 

Gecina SA

  310   48,205 

Hulic Reit, Inc.

  42   62,708 

ICADE

  570   43,825 

Land Securities Group PLC

  6,570   60,680 

Merlin Properties Socimi SA

  7,690   73,325 

Nomura Real Estate Master Fund, Inc.

  30   42,931 

Stockland

  36,410   117,552 
  

 

 

 
   706,021 
  

 

 

 

EQUITY REAL ESTATE INVESTMENT TRUSTS (REITS)–1.3%

  

American Campus Communities, Inc.

  13,008   556,352 

American Tower Corp.

  15   3,367 

Americold Realty Trust

  15,987   596,795 

Mid-America Apartment Communities, Inc.

  8,259   1,046,333 

Orix JREIT, Inc.

  10   16,543 

Prologis, Inc.

  7,399   737,384 

Scentre Group

  2,055   4,414 

VICI Properties, Inc.

  2,049   52,250 

Weyerhaeuser Co.

  1,809   60,656 
  

 

 

 
   3,074,094 
  

 

 

 

HEALTH CARE REITS–0.3%

  

Assura PLC

  64,070   67,432 

Medical Properties Trust, Inc.

  7,110   154,927 

Omega Healthcare Investors, Inc.

  3,617   131,370 

Physicians Realty Trust

  5,173   92,079 

Welltower, Inc.

  3,310   213,892 
  

 

 

 
   659,700 
  

 

 

 

HOTEL & RESORT REITS–0.1%

  

Japan Hotel REIT Investment Corp.

  35   17,998 

RLJ Lodging Trust

  5,596   79,183 
  

 

 

 
   97,181 
  

 

 

 

INDUSTRIAL REITS–0.2%

  

Ascendas Real Estate Investment Trust

  18,800   42,440 

Dream Industrial Real Estate Investment Trust

  4,045   41,788 

GLP J-Reit

  38   59,964 

Industrial & Infrastructure Fund Investment Corp.

  30   55,389 

Mitsui Fudosan Logistics Park, Inc.

  9   45,645 

 

10


  AB Variable Products Series Fund

 

    
    
    
Company
 Shares  U.S. $ Value 
                                          

Plymouth Industrial REIT, Inc.

  1,112  $16,680 

Rexford Industrial Realty, Inc.

  1,851   90,903 

Segro PLC

  8,586   111,410 

STAG Industrial, Inc.

  2,779   87,038 
  

 

 

 
   551,257 
  

 

 

 

OFFICE REITS–0.3%

  

Alexandria Real Estate Equities, Inc.

  1,047   186,596 

Allied Properties Real Estate Investment Trust

  1,685   50,078 

alstria office REIT-AG

  2,390   43,483 

Boston Properties, Inc.

  1,065   100,675 

Cousins Properties, Inc.

  2,842   95,207 

Covivio

  380   34,870 

Daiwa Office Investment Corp.

  9   57,218 

Derwent London PLC

  720   30,599 

Japan Prime Realty Investment Corp.

  17   56,388 

Japan Real Estate Investment Corp.

  7   40,448 

Kilroy Realty Corp.

  1,339   76,859 

Nippon Building Fund, Inc.

  6   34,798 

True North Commercial Real Estate Investment Trust

  3,060   15,169 
  

 

 

 
   822,388 
  

 

 

 

REAL ESTATE DEVELOPMENT–0.1%

  

CIFI Holdings Group Co., Ltd.

  38,000   32,202 

CK Asset Holdings Ltd.

  8,000   40,935 

Instone Real Estate Group AG(a)(e)

  2,115   53,997 
  

 

 

 
   127,134 
  

 

 

 

REAL ESTATE MANAGEMENT & DEVELOPMENT–0.0%

  

CBRE Group, Inc.–Class A(a)

  471   29,541 

FirstService Corp.

  90   12,318 
  

 

 

 
   41,859 
  

 

 

 

REAL ESTATE OPERATING COMPANIES–0.4%

  

ADLER Group SA(a)(e)

  2,050   72,627 

CA Immobilien Anlagen AG

  1,868   71,189 

Deutsche Wohnen SE

  3,810   203,282 

Entra ASA(e)

  3,370   76,432 

Grainger PLC

  13,860   53,911 

Kojamo Oyj

  2,070   45,944 

Kungsleden AB

  3,610   39,572 

LEG Immobilien AG

  610   94,638 

Samhallsbyggnadsbolaget i Norden AB

  17,170   60,100 

Swire Properties Ltd.

  16,000   46,519 

Vonovia SE

  1,513   110,501 

Wharf Real Estate Investment Co., Ltd.

  6,000   31,183 
  

 

 

 
   905,898 
  

 

 

 
                                          

REAL ESTATE SERVICES–0.0%

  

Unibail-Rodamco-Westfield

  327  25,509 
  

 

 

 

RESIDENTIAL REITS–0.4%

  

American Homes 4 Rent–Class A

  4,013   120,390 

Bluerock Residential Growth REIT, Inc.(d)

  1,800   22,806 

Camden Property Trust

  1,262   126,099 

Daiwa Securities Living Investments Corp.

  45   41,775 

Essex Property Trust, Inc.

  622   147,675 

Independence Realty Trust, Inc.

  7,657   102,833 

Invitation Homes, Inc.

  3,580   106,326 

Killam Apartment Real Estate Investment Trust

  6,151   82,680 

Minto Apartment Real Estate Investment Trust

  2,790   44,648 

Sun Communities, Inc.

  1,108   168,361 

UDR, Inc.

  2,000   76,860 
  

 

 

 
   1,040,453 
  

 

 

 

RETAIL REITS–0.4%

  

AEON REIT Investment Corp.

  25   32,006 

Brixmor Property Group, Inc.

  7,564   125,184 

CapitaLand Integrated Commercial Trust

  48,880   79,940 

Eurocommercial Properties NV(a)

  3,100   58,021 

Kenedix Retail REIT Corp.

  8   19,522 

Kimco Realty Corp.

  2,040   30,620 

Link REIT

  12,768   115,956 

Mercialys SA

  3,980   34,992 

National Retail Properties, Inc.

  1,670   68,337 

NETSTREIT Corp.

  1,664   32,431 

Realty Income Corp.

  2,120   131,801 

Simon Property Group, Inc.

  679   57,905 

SITE Centers Corp.

  6,655   67,349 

Vicinity Centres

  75,236   93,027 
  

 

 

 
   947,091 
  

 

 

 

SPECIALIZED REITS–0.2%

  

CubeSmart

  3,086   103,720 

Digital Realty Trust, Inc.

  1,690   235,772 

MGM Growth Properties LLC–Class A

  2,660   83,258 

National Storage Affiliates Trust

  3,172   114,287 

Safestore Holdings PLC

  3,520   37,622 
  

 

 

 
   574,659 
  

 

 

 
   10,152,243 
  

 

 

 

CONSUMER DISCRETIONARY–4.1%

  

AUTO COMPONENTS–0.4%

  

Aisin Seiki Co., Ltd.

  2,300   68,975 

Lear Corp.

  83   13,200 

Magna International, Inc.–Class A (Canada)

  530   37,519 

 

11


BALANCED WEALTH STRATEGY PORTFOLIO
PORTFOLIO OF INVESTMENTS 
(continued) AB Variable Products Series Fund

 

    
    
    
Company
 Shares  U.S. $ Value 
                                          

Magna International, Inc.–Class A (United States)

  10,592  $749,914 
  

 

 

 
   869,608 
  

 

 

 

AUTOMOBILES–0.1%

  

Ford Motor Co.

  915   8,043 

General Motors Co.

  908   37,809 

Peugeot SA(a)

  758   20,759 

Tesla, Inc.(a)

  81   57,159 
  

 

 

 
   123,770 
  

 

 

 

HOTELS, RESTAURANTS & LEISURE–0.0%

  

Aristocrat Leisure Ltd.

  1,313   31,526 

Domino’s Pizza, Inc.

  20   7,669 

La Francaise des Jeux SAEM(e)

  411   18,839 

McDonald’s Corp.

  32   6,867 
  

 

 

 
   64,901 
  

 

 

 

HOUSEHOLD DURABLES–0.0%

  

Electrolux AB–Class B

  1,974   45,929 

SEB SA

  41   7,455 

Whirlpool Corp.

  47   8,483 
  

 

 

 
   61,867 
  

 

 

 

INTERNET & DIRECT MARKETING RETAIL–1.2%

  

Amazon.com, Inc.(a)

  836   2,722,793 

eBay, Inc.

  265   13,316 

HelloFresh SE(a)

  394   30,477 

Zalando SE(a)(e)

  562   62,512 
  

 

 

 
   2,829,098 
  

 

 

 

MULTILINE RETAIL–0.0%

  

Dollar General Corp.

  83   17,455 

Next PLC(a)

  608   58,627 
  

 

 

 
   76,082 
  

 

 

 

SPECIALTY RETAIL–1.6%

  

AutoZone, Inc.(a)

  780   924,643 

Best Buy Co., Inc.

  212   21,156 

Home Depot, Inc. (The)

  6,714   1,783,373 

Lowe’s Cos., Inc.

  22   3,531 

O’Reilly Automotive, Inc.(a)

  160   72,411 

TJX Cos., Inc. (The)

  15,060   1,028,447 
  

 

 

 
   3,833,561 
  

 

 

 

TEXTILES, APPAREL & LUXURY GOODS–0.8%

  

Deckers Outdoor Corp.(a)

  2,007   575,568 

LVMH Moet Hennessy Louis Vuitton SE

  61   38,186 

NIKE, Inc.–Class B

  9,620   1,360,941 

Pandora A/S

  485   54,280 

Ralph Lauren Corp.

  91   9,440 
  

 

 

 
   2,038,415 
  

 

 

 
   9,897,302 
  

 

 

 
                                          

FINANCIALS–3.7%

  

BANKS–1.8%

  

Bank of America Corp.

  49,273  1,493,465 

BNP Paribas SA(a)

  1,470   77,605 

Citigroup, Inc.

  13,272   818,351 

Fifth Third Bancorp

  1,724   47,531 

JPMorgan Chase & Co.

  853   108,391 

Mebuki Financial Group, Inc.

  21,000   41,377 

PNC Financial Services Group, Inc. (The)

  5,690   847,810 

Signature Bank/New York NY

  197   26,652 

Societe Generale SA(a)

  2,160   44,903 

SVB Financial Group(a)

  218   84,547 

Wells Fargo & Co.

  26,949   813,321 
  

 

 

 
   4,403,953 
  

 

 

 

CAPITAL MARKETS–1.1%

  

Ameriprise Financial, Inc.

  30   5,830 

CME Group, Inc.–Class A

  3,813   694,157 

FactSet Research Systems, Inc.

  97   32,252 

Goldman Sachs Group, Inc. (The)

  4,870   1,284,267 

LPL Financial Holdings, Inc.

  6,357   662,527 

Moody’s Corp.

  180   52,243 

Nomura Holdings, Inc.

  7,200   38,067 

S&P Global, Inc.

  109   35,832 
  

 

 

 
   2,805,175 
  

 

 

 

CONSUMER FINANCE–0.0%

  

Ally Financial, Inc.

  145   5,171 
  

 

 

 

DIVERSIFIED FINANCIAL SERVICES–0.1%

  

Kinnevik AB–Class B(a)

  1,722   86,507 

M&G PLC

  24,177   65,258 
  

 

 

 
   151,765 
  

 

 

 

INSURANCE–0.7%

  

AIA Group Ltd.

  400   4,875 

Athene Holding Ltd.–Class A(a)

  581   25,064 

Aviva PLC

  2,165   9,630 

CNP Assurances(a)

  4,892   79,481 

iA Financial Corp., Inc.

  1,539   66,715 

Manulife Financial Corp.

  1,020   18,150 

MetLife, Inc.

  1,474   69,204 

Progressive Corp. (The)

  8,073   798,258 

Prudential Financial, Inc.

  1,079   84,238 

Reinsurance Group of America, Inc.–Class A

  4,131   478,783 

Sun Life Financial, Inc.

  682   30,325 
  

 

 

 
   1,664,723 
  

 

 

 

MORTGAGE REAL ESTATE INVESTMENT TRUSTS (REITS)–0.0%

  

Annaly Capital Management, Inc.

  3,190   26,955 
  

 

 

 
   9,057,742 
  

 

 

 

 

12


  AB Variable Products Series Fund

 

    
    
    
Company
 Shares  U.S. $ Value 
                                          

INDUSTRIALS–3.3%

  

AEROSPACE & DEFENSE–0.5%

  

L3Harris Technologies, Inc.

  4,186  $791,238 

Raytheon Technologies Corp.

  4,349   310,997 
  

 

 

 
   1,102,235 
  

 

 

 

AIR FREIGHT & LOGISTICS–0.0%

  

Kuehne & Nagel International AG

  79   17,927 

United Parcel Service, Inc.–Class B

  475   79,990 
  

 

 

 
   97,917 
  

 

 

 

AIRLINES–0.2%

  

Southwest Airlines Co.

  10,795   503,155 
  

 

 

 

BUILDING PRODUCTS–0.1%

  

Carrier Global Corp.

  1,332   50,243 

Cie de Saint-Gobain(a)

  710   32,654 

Masco Corp.

  826   45,372 

Otis Worldwide Corp.

  665   44,921 
  

 

 

 
   173,190 
  

 

 

 

COMMERCIAL SERVICES & SUPPLIES–0.0%

  

Cintas Corp.

  13   4,595 

Copart, Inc.(a)

  173   22,014 
  

 

 

 
   26,609 
  

 

 

 

CONSTRUCTION & ENGINEERING–0.3%

  

ACS Actividades de Construccion y Servicios SA

  256   8,505 

AECOM(a)

  14,402   716,932 

Shimizu Corp.

  6,700   48,771 
  

 

 

 
   774,208 
  

 

 

 

ELECTRICAL EQUIPMENT–0.5%

  

Acuity Brands, Inc.

  667   80,767 

Eaton Corp. PLC

  7,559   908,138 

Legrand SA

  339   30,326 

Prysmian SpA

  1,379   49,082 

Rockwell Automation, Inc.

  133   33,358 

Vestas Wind Systems A/S

  292   68,979 
  

 

 

 
   1,170,650 
  

 

 

 

INDUSTRIAL CONGLOMERATES–0.4%

  

Honeywell International, Inc.

  4,962   1,055,417 
  

 

 

 

MACHINERY–0.1%

  

Deere & Co.

  203   54,617 

Mitsubishi Heavy Industries Ltd.

  200   6,125 

Snap-on, Inc.

  466   79,751 

Techtronic Industries Co., Ltd.

  5,500   78,614 

Volvo AB–Class B(a)

  3,775   89,366 
  

 

 

 
   308,473 
  

 

 

 
                                          

MARINE–0.0%

  

Nippon Yusen KK

  2,500  58,327 
  

 

 

 

PROFESSIONAL SERVICES–0.0%

  

Randstad NV(a)

  363   23,498 

Robert Half International, Inc.

  1,264   78,975 
  

 

 

 
   102,473 
  

 

 

 

ROAD & RAIL–0.9%

  

CSX Corp.

  10,199   925,559 

Knight-Swift Transportation Holdings, Inc.

  12,504   522,918 

Norfolk Southern Corp.

  2,551   606,143 
  

 

 

 
   2,054,620 
  

 

 

 

TRADING COMPANIES & DISTRIBUTORS–0.3%

  

United Rentals, Inc.(a)

  3,017   699,672 

WW Grainger, Inc.

  6   2,450 
  

 

 

 
   702,122 
  

 

 

 
   8,129,396 
  

 

 

 

MATERIALS–1.8%

  

CHEMICALS–0.7%

  

Clariant AG

  579   12,284 

Covestro AG(e)

  1,080   66,543 

Daicel Corp.

  2,600   19,004 

Evonik Industries AG

  2,148   70,206 

FMC Corp.

  37   4,252 

Kuraray Co., Ltd.

  1,700   18,100 

LANXESS AG

  507   38,558 

LyondellBasell Industries NV–Class A

  6,134   562,242 

Mitsubishi Chemical Holdings Corp.

  3,600   21,810 

Mitsui Chemicals, Inc.

  1,300   38,188 

Orbia Advance Corp. SAB de CV

  30,101   70,777 

PPG Industries, Inc.

  82   11,826 

RPM International, Inc.

  874   79,342 

Sika AG

  156   42,525 

Umicore SA

  725   34,847 

Westlake Chemical Corp.

  6,333   516,773 

Yara International ASA

  1,390   57,665 
  

 

 

 
   1,664,942 
  

 

 

 

CONSTRUCTION MATERIALS–0.0%

  

Fletcher Building Ltd.(a)

  10,890   46,330 

Grupo Cementos de Chihuahua SAB de CV

  3,320   20,107 
  

 

 

 
   66,437 
  

 

 

 

CONTAINERS & PACKAGING–0.0%

  

Sealed Air Corp.

  1,017   46,568 

Smurfit Kappa Group PLC

  602   27,976 
  

 

 

 
   74,544 
  

 

 

 

 

13


BALANCED WEALTH STRATEGY PORTFOLIO
PORTFOLIO OF INVESTMENTS 
(continued) AB Variable Products Series Fund

 

    
    
    
Company
 Shares  U.S. $ Value 
                                          

METALS & MINING–1.0%

  

Agnico Eagle Mines Ltd.

  3,779  $265,976 

Alcoa Corp.(a)

  3,460   79,753 

Anglo American PLC

  4,080   134,731 

AngloGold Ashanti Ltd.

  5,909   136,193 

APERAM SA

  2,580   107,368 

ArcelorMittal SA(a)

  7,087   162,079 

BHP Group Ltd.

  243   7,940 

Boliden AB

  2,635   93,483 

First Quantum Minerals Ltd.

  6,573   117,993 

Fortescue Metals Group Ltd.

  429   7,749 

Glencore PLC(a)

  91,129   289,407 

Industrias Penoles SAB de CV

  2,589   44,014 

Lundin Mining Corp.

  6,445   57,215 

MMC Norilsk Nickel PJSC (ADR)

  2,130   67,052 

Northern Star Resources Ltd.

  5,420   52,975 

Orocobre Ltd.(a)

  5,420   18,702 

OZ Minerals Ltd.

  2,685   39,224 

Polyus PJSC (GDR)(e)

  730   75,151 

Regis Resources Ltd.

  13,940   40,227 

Rio Tinto PLC

  4,641   349,342 

St. Barbara Ltd.

  23,750   43,202 

Steel Dynamics, Inc.

  125   4,609 

Sumitomo Metal Mining Co., Ltd.

  1,400   62,273 

Vale SA (Sponsored ADR)–Class B

  13,836   231,891 

Yamana Gold, Inc.

  4,751   27,135 
  

 

 

 
   2,515,684 
  

 

 

 

PAPER & FOREST PRODUCTS–0.1%

  

Suzano SA(a)

  9,200   103,317 
  

 

 

 
   4,424,924 
  

 

 

 

CONSUMER STAPLES–1.8%

  

BEVERAGES–0.0%

  

Coca-Cola Amatil Ltd.

  2,823   28,128 

Kirin Holdings Co., Ltd.

  3,600   85,007 
  

 

 

 
   113,135 
  

 

 

 

FOOD & STAPLES RETAILING–0.8%

  

Coles Group Ltd.

  2,043   28,544 

Costco Wholesale Corp.

  1,143   430,660 

Kroger Co. (The)

  149   4,732 

Walmart, Inc.

  10,007   1,442,509 
  

 

 

 
   1,906,445 
  

 

 

 

FOOD PRODUCTS–0.2%

  

Bunge Ltd.

  126   8,263 

Kellogg Co.

  659   41,010 

Mowi ASA

  7,060   157,268 

Nestle SA

  543   64,189 

Tyson Foods, Inc.–Class A

  1,760   113,414 
  

 

 

 
   384,144 
  

 

 

 
                                          

HOUSEHOLD PRODUCTS–0.8%

  

Kimberly-Clark Corp.

  121  16,315 

Procter & Gamble Co. (The)

  12,980   1,806,037 
  

 

 

 
   1,822,352 
  

 

 

 

PERSONAL PRODUCTS–0.0%

  

Pola Orbis Holdings, Inc.

  600   12,184 

Unilever PLC

  1,465   87,861 
  

 

 

 
   100,045 
  

 

 

 

TOBACCO–0.0%

  

Philip Morris International, Inc.

  1,035   85,688 
  

 

 

 
   4,411,809 
  

 

 

 

ENERGY–1.8%

  

ENERGY EQUIPMENT & SERVICES–0.0%

  

Baker Hughes Co.–Class A

  533   11,113 
  

 

 

 

OIL, GAS & CONSUMABLE FUELS–1.8%

  

Aker BP ASA

  5,338   134,699 

BP PLC

  90,841   313,469 

Canadian Natural Resources Ltd.

  671   16,125 

Cheniere Energy, Inc.(a)

  558   33,497 

Chevron Corp.

  12,161   1,026,996 

ENEOS Holdings, Inc.

  15,200   54,593 

EOG Resources, Inc.

  12,568   626,766 

Exxon Mobil Corp.

  4,501   185,531 

Galp Energia SGPS SA

  2,905   30,783 

LUKOIL PJSC (Sponsored ADR)

  850   58,106 

Motor Oil Hellas Corinth Refineries SA

  3,430   49,315 

Neste Oyj

  78   5,663 

Parkland Corp./Canada

  484   15,358 

PetroChina Co., Ltd.–Class H

  422,000   130,670 

Petroleo Brasileiro SA (Preference Shares)

  36,300   197,068 

Repsol SA

  21,435   215,939 

Royal Dutch Shell PLC–Class A

  1,579 �� 27,690 

Royal Dutch Shell PLC–Class B

  47,949   812,674 

TOTAL SE

  9,279   400,502 

Woodside Petroleum Ltd.

  314   5,509 
  

 

 

 
   4,340,953 
  

 

 

 
   4,352,066 
  

 

 

 

UTILITIES–1.0%

  

ELECTRIC UTILITIES–1.0%

  

American Electric Power Co., Inc.

  10,917   909,059 

Endesa SA

  336   9,216 

Enel SpA

  20,742   211,044 

NextEra Energy, Inc.

  13,823   1,066,444 

Red Electrica Corp. SA

  1,728   35,478 

 

14


  AB Variable Products Series Fund

 

    
    
    
Company
 Shares  U.S. $ Value 
                                          

Terna Rete Elettrica Nazionale SpA

  5,154  $39,604 
  

 

 

 
   2,270,845 
  

 

 

 

GAS UTILITIES–0.0%

  

UGI Corp.

  2,190   76,563 
  

 

 

 

MULTI-UTILITIES–0.0%

  

Sempra Energy

  141   17,965 
  

 

 

 
   2,365,373 
  

 

 

 

CONSUMER SERVICES–0.0%

  

HOTELS, RESORTS & CRUISE LINES–0.0%

  

Hilton Grand Vacations, Inc.(a)

  1,690   52,981 
  

 

 

 

LEISURE FACILITIES–0.0%

  

Planet Fitness, Inc.(a)

  285   22,125 
  

 

 

 
   75,106 
  

 

 

 

TRANSPORTATION–0.0%

  

HIGHWAYS & RAILTRACKS–0.0%

  

Transurban Group

  6,998   73,744 
  

 

 

 

CONSUMER DURABLES & APPAREL–0.0%

  

HOMEBUILDING–0.0%

  

Persimmon PLC

  950   35,856 

PulteGroup, Inc.

  830   35,789 
  

 

 

 
   71,645 
  

 

 

 

SOFTWARE & SERVICES–0.0%

  

INTERNET SERVICES & INFRASTRUCTURE–0.0%

  

GDS Holdings Ltd. (ADR)(a)

  350   32,774 
  

 

 

 

Total Common Stocks
(cost $67,527,919)

   98,736,230 
  

 

 

 

INVESTMENT COMPANIES–26.5%

  

FUNDS AND INVESTMENT TRUSTS–26.5%(f)(g)

  

AB Discovery Growth Fund, Inc.–Class Z

  200,740   3,073,324 

AB Trust–AB Discovery Value Fund–Class Z

  156,078   3,151,209 

Bernstein Fund, Inc.–International Small Cap Portfolio–Class Z

  701,404   8,409,829 

Bernstein Fund, Inc.–International Strategic Equities Portfolio–Class Z

  3,363,423   42,917,274 

Bernstein Fund, Inc.–Small Cap Core Portfolio–Class Z

  236,284   3,104,771 

Sanford C. Bernstein Fund, Inc.–Emerging Markets Portfolio–Class Z

  121,799   3,964,568 
  

 

 

 

Total Investment Companies
(cost $63,115,115)

   64,620,975 
  

 

 

 
      
Principal
Amount
(000)
  U.S. $ Value 
                                           

GOVERNMENTS–TREASURIES–11.9%

 

  

AUSTRALIA–1.7%

   

Australia Government Bond
Series 144
3.75%, 04/21/2037(e)

  AUD   620  $636,882 

Series 145
2.75%, 06/21/2035(e)

   802   733,967 

Series 150
3.00%, 03/21/2047(e)

   1,430   1,356,399 

Series 161
0.25%, 11/21/2025(e)

   1,770   1,359,437 
   

 

 

 
    4,086,685 
   

 

 

 

AUSTRIA–0.3%

   

Republic of Austria Government Bond
0.75%, 02/20/2028(e)

  EUR   510   683,059 
   

 

 

 

BELGIUM–0.1%

   

Kingdom of Belgium Government Bond
Series 76
1.90%, 06/22/2038(e)

   180   292,300 
   

 

 

 

CANADA–1.1%

   

Canadian Government Bond
1.25%, 03/01/2025–
06/01/2030

  CAD   2,860   2,356,312 

2.00%, 12/01/2051

   359   339,215 
   

 

 

 
    2,695,527 
   

 

 

 

CHINA–0.8%

   

China Government Bond
Series INBK
3.27%, 11/19/2030

  CNY   5,690   880,899 

3.39%, 03/16/2050

   7,870   1,118,217 
   

 

 

 
    1,999,116 
   

 

 

 

COLOMBIA–0.4%

   

Colombian TES
Series B
5.75%, 11/03/2027

  COP   2,916,500   902,155 
   

 

 

 

FINLAND–0.1%

   

Finland Government Bond
0.50%, 09/15/2028(e)

  EUR   115   152,194 
   

 

 

 

FRANCE–0.1%

   

French Republic Government Bond OAT
1.50%, 05/25/2050(e)

   110   179,152 
   

 

 

 

GERMANY–0.4%

   

Bundesrepublik Deutschland Bundesanleihe
Zero Coupon, 08/15/2050(e)

   275   352,933 

Series 3
4.75%, 07/04/2034(e)

   250   530,083 
   

 

 

 
    883,016 
   

 

 

 

 

15


BALANCED WEALTH STRATEGY PORTFOLIO
PORTFOLIO OF INVESTMENTS 
(continued) AB Variable Products Series Fund

 

      
Principal
Amount
(000)
  U.S. $ Value 
                                           

ITALY–0.7%

   

Italy Buoni Poliennali Del Tesoro 1.80%, 03/01/2041(e)

  EUR   1,235  $1,668,921 
   

 

 

 

JAPAN–3.5%

   

Japan Government Ten Year Bond
Series 358
0.10%, 03/20/2030

  JPY   205,850   2,013,006 

Series 359
0.10%, 06/20/2030

   277,550   2,711,042 

Japan Government Thirty Year Bond
Series 62
0.50%, 03/20/2049

   63,600   598,131 

Series 65
0.40%, 12/20/2049

   62,950   572,674 

Series 68
0.60%, 09/20/2050

   69,900   669,464 

Japan Government Twenty Year Bond
Series 169
0.30%, 06/20/2039

   31,650   302,550 

Series 171
0.30%, 12/20/2039

   44,850   427,425 

Japan Government Two Year Bond
Series 419
0.10%, 12/01/2022

   126,950   1,234,792 
   

 

 

 
    8,529,084 
   

 

 

 

MALAYSIA–0.1%

   

Malaysia Government Bond Series 0310
4.498%, 04/15/2030

  MYR   1,088   309,646 
   

 

 

 

MEXICO–0.0%

   

Mexican Bonos
Series M
8.00%, 11/07/2047

  MXN   1,125   66,394 
   

 

 

 

SPAIN–0.3%

   

Spain Government Bond
1.20%, 10/31/2040(e)

  EUR   455   616,038 

4.20%, 01/31/2037(e)

   114   221,807 
   

 

 

 
    837,845 
   

 

 

 

UNITED KINGDOM–0.9%

   

United Kingdom Gilt
0.625%, 10/22/2050(e)

  GBP   735   973,915 

1.75%, 09/07/2037(e)

   821   1,332,655 
   

 

 

 
    2,306,570 
   

 

 

 

UNITED STATES–1.4%

   

U.S. Treasury Bonds
1.125%, 05/15/2040–08/15/2040

  U.S.$   2,780   2,633,725 

4.50%, 08/15/2039

   455   695,795 
                                           

4.625%, 02/15/2040

  U.S.$   100  155,781 
   

 

 

 
    3,485,301 
   

 

 

 

Total Governments–Treasuries
(cost $27,659,743)

    29,076,965 
   

 

 

 

CORPORATES–INVESTMENT GRADE–9.4%

   

INDUSTRIAL–5.0%

   

BASIC–0.6%

   

AngloGold Ashanti Holdings PLC
3.75%, 10/01/2030

   201   215,070 

Glencore Finance Europe Ltd.
1.875%, 09/13/2023(e)

  EUR   125   159,480 

3.125%, 03/26/2026(e)

  GBP   110   162,531 

Inversiones CMPC SA
3.85%, 01/13/2030(e)

  U.S.$   200   223,938 

SABIC Capital II BV
4.00%, 10/10/2023(e)

   335   360,544 

SIG Combibloc PurchaseCo Sarl
1.875%, 06/18/2023(e)

  EUR   140   176,670 

Smurfit Kappa Acquisitions ULC
2.875%, 01/15/2026(e)

   150   202,521 

Suzano Austria GmbH
3.75%, 01/15/2031

  U.S.$   32   33,920 
   

 

 

 
    1,534,674 
   

 

 

 

CAPITAL GOODS–0.1%

   

CNH Industrial Finance Europe SA
1.75%, 09/12/2025(e)

  EUR   190   247,280 

Westinghouse Air Brake Technologies Corp.
3.20%, 06/15/2025

  U.S.$   10   10,780 

4.40%, 03/15/2024

   67   73,334 
   

 

 

 
    331,394 
   

 

 

 

COMMUNICATIONS–MEDIA–0.5%

   

Charter Communications Operating LLC/Charter Communications Operating Capital
4.80%, 03/01/2050

   17   20,191 

5.125%, 07/01/2049

   84   102,281 

5.375%, 05/01/2047

   35   43,797 

Comcast Corp.
0.75%, 02/20/2032

  EUR   155   196,941 

Fox Corp.
4.709%, 01/25/2029

  U.S.$   215   261,051 

Prosus NV
3.68%, 01/21/2030(e)

   220   238,837 

ViacomCBS, Inc.
3.70%, 06/01/2028

   23   26,266 

 

16


  AB Variable Products Series Fund

 

      
Principal
Amount
(000)
  U.S. $ Value 
                                           

4.20%, 05/19/2032

  U.S.$   56  $67,315 

4.95%, 01/15/2031

   114   143,043 

Walt Disney Co. (The)
3.60%, 01/13/2051

   35   42,425 
   

 

 

 
    1,142,147 
   

 

 

 

COMMUNICATIONS–
TELECOMMUNICATIONS–0.3%

 

AT&T, Inc.
3.50%, 09/15/2053(e)

   200   201,110 

Series B
2.875%, 03/02/2025(h)

  EUR   100   123,123 

British Telecommunications PLC
9.625%, 12/15/2030

  U.S.$   145   240,276 

Sprint Spectrum Co. LLC/Sprint Spectrum Co. II LLC/Sprint Spectrum Co. III LLC
4.738%, 03/20/2025(e)

   200   217,122 
   

 

 

 
    781,631 
   

 

 

 

CONSUMER CYCLICAL–AUTOMOTIVE–0.4%

   

Harley-Davidson Financial Services, Inc.
0.90%, 11/19/2024(e)

  EUR   200   247,941 

3.35%, 06/08/2025(e)

  U.S.$   30   32,471 

Lear Corp.
3.50%, 05/30/2030

   25   27,316 

3.80%, 09/15/2027

   127   142,203 

4.25%, 05/15/2029

   33   37,633 

Nissan Motor Co., Ltd.
4.345%, 09/17/2027(e)

   200   219,908 

Volkswagen Bank GmbH
1.25%, 06/10/2024(e)

  EUR   100   126,496 

Volkswagen Leasing GmbH
2.625%, 01/15/2024(e)

   73   95,939 
   

 

 

 
    929,907 
   

 

 

 

CONSUMER CYCLICAL–OTHER–0.1%

 

  

Las Vegas Sands Corp.
3.50%, 08/18/2026

  U.S.$   89   95,419 

Marriott International, Inc./MD
Series EE
5.75%, 05/01/2025

   109   127,530 
   

 

 

 
    222,949 
   

 

 

 

CONSUMER CYCLICAL–RETAILERS–0.1%

   

AutoNation, Inc.
4.75%, 06/01/2030

   12   14,456 

Ralph Lauren Corp.
2.95%, 06/15/2030

   162   175,387 

Ross Stores, Inc.
4.70%, 04/15/2027

   24   28,374 
   

 

 

 
    218,217 
   

 

 

 
                                           

CONSUMER NON-CYCLICAL–0.9%

 

  

Altria Group, Inc.
3.125%, 06/15/2031

  EUR   270  393,298 

Amgen, Inc.
4.663%, 06/15/2051

  U.S.$   150   203,659 

Anheuser-Busch InBev Worldwide, Inc.
5.55%, 01/23/2049

   145   205,655 

BAT Capital Corp.
4.906%, 04/02/2030

   55   66,421 

BAT Netherlands Finance BV
3.125%, 04/07/2028(e)

  EUR   200   284,984 

Biogen, Inc.
3.15%, 05/01/2050

  U.S.$   202   208,630 

CommonSpirit Health
3.91%, 10/01/2050

   120   133,812 

CVS Health Corp.
5.05%, 03/25/2048

   125   169,003 

DH Europe Finance II SARL
0.45%, 03/18/2028

  EUR   143   177,978 

Gilead Sciences, Inc.
2.80%, 10/01/2050

  U.S.$   200   199,704 

Takeda Pharmaceutical Co., Ltd.
0.75%, 07/09/2027

  EUR   131   166,230 
   

 

 

 
    2,209,374 
   

 

 

 

ENERGY–0.9%

   

Boardwalk Pipelines LP
4.80%, 05/03/2029

  U.S.$   125   143,124 

BP Capital Markets PLC
1.573%, 02/16/2027(e)

  EUR   175   232,358 

3.25%, 03/22/2026(e)(h)

   135   175,854 

Energy Transfer Operating LP
3.75%, 05/15/2030

  U.S.$   101   108,847 

5.50%, 06/01/2027

   190   222,648 

Eni SpA
4.25%, 05/09/2029(e)

   270   319,232 

Husky Energy, Inc.
4.40%, 04/15/2029

   220   244,928 

ONEOK, Inc.
4.55%, 07/15/2028

   104   118,940 

6.35%, 01/15/2031

   130   166,907 

Plains All American Pipeline LP/PAA Finance Corp.
3.80%, 09/15/2030

   42   44,998 

Plains All American Pipeline LP/PAA Finance Corp.
3.55%, 12/15/2029

   16   16,752 

4.50%, 12/15/2026

   29   32,504 

Saudi Arabian Oil Co.
2.25%, 11/24/2030(e)

   200   202,750 

2.875%, 04/16/2024(e)

   200   212,500 

 

17


BALANCED WEALTH STRATEGY PORTFOLIO
PORTFOLIO OF INVESTMENTS 
(continued) AB Variable Products Series Fund

 

      
Principal
Amount
(000)
  U.S. $ Value 
                                           

Valero Energy Corp.
6.625%, 06/15/2037

  U.S.$   32  $42,437 
   

 

 

 
    2,284,779 
   

 

 

 

OTHER INDUSTRIAL–0.1%

 

 

Alfa SAB de CV
5.25%, 03/25/2024(e)

   200   220,375 
   

 

 

 

SERVICES–0.0%

   

Expedia Group, Inc.
6.25%, 05/01/2025(e)

   6   6,959 

Global Payments, Inc.
4.45%, 06/01/2028

   70   82,913 
   

 

 

 
    89,872 
   

 

 

 

TECHNOLOGY–0.5%

 

 

Baidu, Inc.
3.075%, 04/07/2025

   205   218,291 

Broadcom Corp./Broadcom Cayman Finance Ltd.
3.50%, 01/15/2028

   19   20,913 

Broadcom, Inc.
4.11%, 09/15/2028

   156   178,427 

Fidelity National Information Services, Inc.
1.00%, 12/03/2028

  EUR   165   211,498 

Fiserv, Inc.
1.125%, 07/01/2027

   200   258,721 

Leidos, Inc.
4.375%, 05/15/2030(e)

  U.S.$   109   130,659 

Oracle Corp.
3.60%, 04/01/2050

   185   215,962 
   

 

 

 
    1,234,471 
   

 

 

 

TRANSPORTATION–AIRLINES–0.2%

   

Delta Air Lines, Inc.
7.00%, 05/01/2025(e)

   99   114,664 

Southwest Airlines Co.
5.25%, 05/04/2025

   199   230,694 
   

 

 

 
    345,358 
   

 

 

 

TRANSPORTATION–SERVICES–0.3%

   

Adani Ports & Special Economic Zone Ltd.
3.95%, 01/19/2022(e)

   200   204,500 

ENA Master Trust
4.00%, 05/19/2048(e)

   200   215,187 

Heathrow Funding Ltd.
6.75%, 12/03/2026(e)

  GBP   135   237,715 
   

 

 

 
    657,402 
   

 

 

 
    12,202,550 
   

 

 

 

FINANCIAL INSTITUTIONS–4.0%

 

 

BANKING–2.7%

   

ABN AMRO Bank NV
4.75%, 07/28/2025(e)

  U.S.$   225   259,693 

Australia & New Zealand Banking Group Ltd.
4.40%, 05/19/2026(e)

   215   247,448 
                                           

Bankia SA
1.125%, 11/12/2026(e)

  EUR   100  127,278 

BNP Paribas SA
2.219%, 06/09/2026(e)

  U.S.$   200   209,288 

BPCE SA
4.625%, 07/11/2024(e)

   200   223,686 

Capital One Financial Corp.
1.65%, 06/12/2029

  EUR   270   353,644 

Citigroup, Inc.
1.50%, 07/24/2026(e)

   155   201,145 

5.95%, 01/30/2023(h)

  U.S.$   90   94,611 

Commonwealth Bank of Australia
4.50%, 12/09/2025(e)

   205   236,183 

Cooperatieve Rabobank UA 3.25%, 12/29/2026(e)(h)

  EUR   200   246,773 

Credit Suisse Group AG
4.194%, 04/01/2031(e)

  U.S.$   250   294,142 

Danske Bank A/S
3.244%, 12/20/2025(e)

   350   374,885 

5.375%, 01/12/2024(e)

   200   225,744 

Deutsche Bank AG/New York NY
3.961%, 11/26/2025

   225   246,037 

DNB Bank ASA
6.50%, 03/26/2022(e)(h)

   210   219,878 

Fifth Third Bancorp
Series L
4.50%, 09/30/2025(h)

   41   43,759 

Goldman Sachs Group, Inc. (The)
1.25%, 05/01/2025(e)

  EUR   190   241,215 

Series O
5.30%, 11/10/2026(h)

  U.S.$   10   10,999 

HSBC Holdings PLC
6.375%, 03/30/2025(h)

   200   218,768 

ING Groep NV
3.00%, 02/18/2026(e)

  GBP   200   303,872 

6.50%, 04/16/2025(h)

  U.S.$   232   255,293 

JPMorgan Chase & Co.
1.09%, 03/11/2027(e)

  EUR   170   218,281 

Morgan Stanley
Series G
1.375%, 10/27/2026

   100   131,230 

Series J
4.047% (LIBOR 3 Month + 3.81%), 04/15/2021(h)(i)

  U.S.$   55   54,876 

Natwest Group PLC
Series U
2.574% (LIBOR 3 Month + 2.32%), 09/30/2027(h)(i)

   200   193,216 

Societe Generale SA
4.25%, 04/14/2025(e)

   205   226,095 

 

18


  AB Variable Products Series Fund

 

      
Principal
Amount
(000)
  U.S. $ Value 
                                           

Standard Chartered PLC
1.724% (LIBOR 3 Month + 1.51%), 01/30/2027(e)(h)(i)

  U.S.$   200  $185,154 

Truist Financial Corp.
Series Q
5.10%, 03/01/2030(h)

   75   85,661 

UBS Group AG
7.125%, 08/10/2021(e)(h)

   230   236,242 

UniCredit SpA
2.569%, 09/22/2026(e)

   350   357,003 

Wells Fargo & Co.
0.625%, 08/14/2030(e)

  EUR   245   304,461 
   

 

 

 
    6,626,560 
   

 

 

 

FINANCE–0.5%

   

AerCap Ireland Capital DAC/AerCap Global Aviation Trust
6.50%, 07/15/2025

  U.S.$   150   179,319 

Air Lease Corp.
2.875%, 01/15/2026

   67   70,887 

3.625%, 04/01/2027

   14   15,086 

3.875%, 07/03/2023

   6   6,393 

4.25%, 02/01/2024

   21   22,785 

Aircastle Ltd.
4.40%, 09/25/2023

   67   71,496 

5.25%, 08/11/2025(e)

   69   75,921 

Aviation Capital Group LLC
2.875%, 01/20/2022(e)

   11   11,159 

3.50%, 11/01/2027(e)

   18   18,025 

3.875%, 05/01/2023(e)

   44   45,878 

4.125%, 08/01/2025(e)

   2   2,089 

4.375%, 01/30/2024(e)

   13   13,717 

4.875%, 10/01/2025(e)

   23   24,631 

5.50%, 12/15/2024(e)

   47   51,904 

GE Capital European Funding Unlimited Co.
4.625%, 02/22/2027

  EUR   100   152,693 

GE Capital Funding LLC
4.40%, 05/15/2030(e)

  U.S.$   200   235,622 

Synchrony Financial
3.95%, 12/01/2027

   25   28,092 

4.50%, 07/23/2025

   51   57,398 
   

 

 

 
    1,083,095 
   

 

 

 

INSURANCE–0.5%

   

Alleghany Corp.
3.625%, 05/15/2030

   172   194,669 

ASR Nederland NV
3.375%, 05/02/2049(e)

  EUR   100   136,519 

Centene Corp.
4.25%, 12/15/2027

  U.S.$   28   29,802 

4.625%, 12/15/2029

   37   41,031 

CNP Assurances
4.50%, 06/10/2047(e)

  EUR   200   294,102 
                                           

Credit Agricole Assurances SA
4.25%, 01/13/2025(e)(h)

  EUR   200  273,650 

Voya Financial, Inc.
5.65%, 05/15/2053

  U.S.$   153   161,625 
   

 

 

 
    1,131,398 
   

 

 

 

REITS–0.3%

   

CyrusOne LP/CyrusOne Finance Corp.
1.45%, 01/22/2027

  EUR   100   123,658 

Digital Euro Finco LLC
2.50%, 01/16/2026(e)

   220   299,313 

Equinix, Inc.
2.875%, 02/01/2026

   58   71,284 

Host Hotels & Resorts LP
Series D
3.75%, 10/15/2023

  U.S.$   10   10,542 

Rexford Industrial Realty LP
2.125%, 12/01/2030

   91   91,365 

WPC Eurobond BV
2.125%, 04/15/2027

  EUR   148   197,048 
   

 

 

 
    793,210 
   

 

 

 
    9,634,263 
   

 

 

 

UTILITY–0.4%

   

ELECTRIC–0.4%

   

Abu Dhabi National Energy Co. PJSC
4.375%, 04/23/2025(e)

  U.S.$   250   282,500 

Enel Finance International NV
2.65%, 09/10/2024(e)

   308   328,097 

Enel SpA
3.50%, 05/24/2080(e)

  EUR   162   216,214 

Naturgy Finance BV
4.125%, 11/18/2022(e)(h)

   100   128,742 
   

 

 

 
    955,553 
   

 

 

 

Total Corporates–Investment Grade
(cost $20,893,692)

    22,792,366 
   

 

 

 

CORPORATES–NON-INVESTMENT GRADE–2.1%

   

INDUSTRIAL–1.6%

   

BASIC–0.3%

   

Axalta Coating Systems LLC
3.375%, 02/15/2029(e)

  U.S.$   150   150,630 

Ingevity Corp.
3.875%, 11/01/2028(e)

   88   88,431 

OCI NV
3.625%, 10/15/2025(e)

  EUR   100   126,746 

Solvay SA
2.50%, 12/02/2025(h)

   100   125,574 

 

19


BALANCED WEALTH STRATEGY PORTFOLIO
PORTFOLIO OF INVESTMENTS 
(continued) AB Variable Products Series Fund

 

      
Principal
Amount
(000)
  U.S. $ Value 
                                           

SPCM SA
4.875%, 09/15/2025(e)

  U.S.$   200  $206,190 

WEPA Hygieneprodukte GmbH
2.875%, 12/15/2027(e)

  EUR   120   148,502 
   

 

 

 
    846,073 
   

 

 

 

CAPITAL GOODS–0.2%

   

Rolls-Royce PLC
0.875%, 05/09/2024(e)

   160   184,225 

TransDigm, Inc.
6.25%, 03/15/2026(e)

  U.S.$   110   117,220 

Vertical Midco GmbH
4.375%, 07/15/2027(e)

  EUR   140   180,482 
   

 

 

 
    481,927 
   

 

 

 

COMMUNICATIONS–MEDIA–0.0%

   

Cable One, Inc.
4.00%, 11/15/2030(e)

  U.S.$   53   55,100 

CSC Holdings LLC
6.75%, 11/15/2021

   45   46,817 
   

 

 

 
    101,917 
   

 

 

 

COMMUNICATIONS–TELECOMMUNICATIONS–0.1%

   

CenturyLink, Inc.
4.50%, 01/15/2029(e)

   103   104,792 

Telefonica Europe BV
3.75%, 03/15/2022(e)(h)

  EUR   100   125,219 
   

 

 

 
    230,011 
   

 

 

 

CONSUMER CYCLICAL–AUTOMOTIVE–0.2%

   

Allison Transmission, Inc.
3.75%, 01/30/2031(e)

  U.S.$   105   107,415 

Clarios Global LP/Clarios US Finance Co.
4.375%, 05/15/2026(e)

  EUR   120   151,990 

Ford Motor Co.
8.50%, 04/21/2023

  U.S.$   108   121,448 

Tenneco, Inc.
5.00%, 07/15/2024(e)

  EUR   100   123,999 
   

 

 

 
    504,852 
   

 

 

 

CONSUMER CYCLICAL–ENTERTAINMENT–0.1%

   

Carnival PLC
1.00%, 10/28/2029

   200   174,696 
   

 

 

 

CONSUMER CYCLICAL–RESTAURANTS–0.0%

   

1011778 BC ULC/New Red Finance, Inc.
3.50%, 02/15/2029(e)

  U.S.$   116   116,267 
   

 

 

 

CONSUMER CYCLICAL–RETAILERS–0.1%

   

Dufry One BV
2.50%, 10/15/2024(e)

  EUR   105   123,142 
   

 

 

 
                                           

CONSUMER NON-CYCLICAL–0.4%

 

  

Albertsons Cos., Inc./Safeway, Inc./New Albertsons LP/Albertsons LLC
3.50%, 02/15/2023(e)

  U.S.$   61  62,489 

4.625%, 01/15/2027(e)

   46   48,876 

Avantor Funding, Inc.
2.625%, 11/01/2025(e)

  EUR   102   127,603 

Catalent Pharma Solutions, Inc.
2.375%, 03/01/2028(e)

   165   202,427 

Cheplapharm Arzneimittel GmbH
3.50%, 02/11/2027(e)

   120   147,023 

Grifols SA
1.625%, 02/15/2025(e)

   200   244,870 

Tenet Healthcare Corp.
4.625%, 07/15/2024

  U.S.$   102   104,499 
   

 

 

 
    937,787 
   

 

 

 

OTHER INDUSTRIAL–0.1%

   

H&E Equipment Services, Inc.
3.875%, 12/15/2028(e)

   118   119,233 

Rexel SA
2.125%, 06/15/2025(e)

  EUR   120   147,148 
   

 

 

 
    266,381 
   

 

 

 

TECHNOLOGY–0.0%

   

Dell International LLC/EMC Corp.
7.125%, 06/15/2024(e)

  U.S.$   14   14,526 
   

 

 

 

TRANSPORTATION–SERVICES–0.1%

 

  

Chicago Parking Meters LLC
4.93%, 12/30/2025(c)

   200   230,127 
   

 

 

 
    4,027,706 
   

 

 

 

FINANCIAL INSTITUTIONS–0.5%

 

  

BANKING–0.3%

   

Banco Santander SA
6.75%, 04/25/2022(e)(h)

  EUR   200   258,074 

Credit Suisse Group AG
7.50%, 12/11/2023(e)(h)

  U.S.$   200   222,326 

Discover Financial Services
Series D
6.125%, 06/23/2025(h)

   117   132,018 
   

 

 

 
    612,418 
   

 

 

 

FINANCE–0.2%

   

Lincoln Financing SARL
3.625%, 04/01/2024(e)

  EUR   120   148,074 

 

20


  AB Variable Products Series Fund

 

      
Principal
Amount
(000)
  U.S. $ Value 
                                           

Navient Corp.
6.625%, 07/26/2021

  U.S.$   170  $174,129 

SLM Corp.
4.20%, 10/29/2025

   96   101,495 
   

 

 

 
    423,698 
   

 

 

 

INSURANCE–0.0%

   

Molina Healthcare, Inc.
3.875%, 11/15/2030(e)

   89   95,460 
   

 

 

 

REITS–0.0%

   

MGM Growth Properties Operating Partnership LP/MGP Finance Co-Issuer, Inc.
4.625%, 06/15/2025(e)

   58   62,095 
   

 

 

 
    1,193,671 
   

 

 

 

Total Corporates–Non-Investment Grade
(cost $4,905,782)

    5,221,377 
   

 

 

 

QUASI-SOVEREIGNS–1.8%

   

QUASI-SOVEREIGN BONDS–1.8%

 

  

CHILE–0.1%

   

Corp. Nacional del Cobre de Chile
3.75%, 01/15/2031(e)

   200   227,250 
   

 

 

 

CHINA–1.3%

   

China Development Bank
Series 1805
4.88%, 02/09/2028

  CNY   14,390   2,395,958 

Series 1910
3.65%, 05/21/2029

   2,040   311,566 

Series 2004
3.43%, 01/14/2027

   1,780   271,295 

Series 2009
3.39%, 07/10/2027

   1,140   173,171 
   

 

 

 
    3,151,990 
   

 

 

 

INDONESIA–0.2%

   

Indonesia Asahan Aluminium Persero PT
4.75%, 05/15/2025(e)

  U.S.$   200   220,750 

Perusahaan Perseroan Persero PT Perusahaan Listrik Negara
3.375%, 02/05/2030(e)

   210   222,403 
   

 

 

 
    443,153 
   

 

 

 

MEXICO–0.1%

   

Petroleos Mexicanos
5.95%, 01/28/2031

   39   38,903 

7.69%, 01/23/2050

   120   120,990 
   

 

 

 
    159,893 
   

 

 

 

UNITED ARAB EMIRATES–0.1%

   

DP World Crescent Ltd.
3.75%, 01/30/2030(e)

   200   217,500 
                                           

3.875%, 07/18/2029(e)

  U.S.$   200  219,500 
   

 

 

 
    437,000 
   

 

 

 

Total Quasi-Sovereigns
(cost $4,132,156)

    4,419,286 
   

 

 

 

COLLATERALIZED MORTGAGE OBLIGATIONS–1.6%

   

RISK SHARE FLOATING RATE–1.0%

 

  

Bellemeade Re Ltd.
Series 2019-1A, Class M1B
1.898% (LIBOR 1 Month + 1.75%), 03/25/2029(e)(i)

   220   219,914 

Series 2019-2A, Class M2
3.248% (LIBOR 1 Month + 3.10%), 04/25/2029(e)(i)

   150   150,136 

Connecticut Avenue Securities Trust
Series 2019-R02, Class 1M2
2.448% (LIBOR 1 Month + 2.30%), 08/25/2031(e)(i)

   56   55,809 

Series 2019-R03, Class 1M2
2.298% (LIBOR 1 Month + 2.15%), 09/25/2031(e)(i)

   41   40,947 

Series 2019-R04, Class 2M2
2.248% (LIBOR 1 Month + 2.10%), 06/25/2039(e)(i)

   75   75,126 

Series 2019-R05, Class 1M2
2.148% (LIBOR 1 Month + 2.00%), 07/25/2039(e)(i)

   45   45,234 

Series 2019-R06, Class 2M2
2.248% (LIBOR 1 Month + 2.10%), 09/25/2039(e)(i)

   87   87,268 

Series 2019-R07, Class 1M2
2.248% (LIBOR 1 Month + 2.10%), 10/25/2039(e)(i)

   58   57,801 

Eagle RE Ltd.
Series 2018-1, Class M1
1.848% (LIBOR 1 Month + 1.70%), 11/25/2028(e)(i)

   56   55,731 

 

21


BALANCED WEALTH STRATEGY PORTFOLIO
PORTFOLIO OF INVESTMENTS 
(continued) AB Variable Products Series Fund

 

      
Principal
Amount
(000)
  U.S. $ Value 
                                           

Federal Home Loan Mortgage Corp. Structured Agency Credit Risk Debt Notes
Series 2014-DN3, Class M3
4.148% (LIBOR 1 Month + 4.00%), 08/25/2024(i)

  U.S.$   136  $138,487 

Series 2014-HQ3, Class M3
4.898% (LIBOR 1 Month + 4.75%), 10/25/2024(i)

   66   66,978 

Series 2019-DNA3, Class M2
2.198% (LIBOR 1 Month + 2.05%), 07/25/2049(e)(i)

   20   20,331 

Series 2019-HQA1, Class M2
2.498% (LIBOR 1 Month + 2.35%), 02/25/2049(e)(i)

   46   45,491 

Federal National Mortgage Association Connecticut Avenue Securities
Series 2015-C01, Class 1M2
4.448% (LIBOR 1 Month + 4.30%), 02/25/2025(i)

   50   51,164 

Series 2015-C02, Class 1M2
4.148% (LIBOR 1 Month + 4.00%), 05/25/2025(i)

   70   71,587 

Series 2015-C02, Class 2M2
4.148% (LIBOR 1 Month + 4.00%), 05/25/2025(i)

   37   37,405 

Series 2015-C03, Class 1M2
5.148% (LIBOR 1 Month + 5.00%), 07/25/2025(i)

   34   34,773 

Series 2015-C03, Class 2M2
5.148% (LIBOR 1 Month + 5.00%), 07/25/2025(i)

   56   56,749 

Series 2015-C04, Class 1M2
5.848% (LIBOR 1 Month + 5.70%), 04/25/2028(i)

   34   36,484 
                                           

Series 2015-C04, Class 2M2
5.698% (LIBOR 1 Month + 5.55%), 04/25/2028(i)

  U.S.$   121  127,151 

Series 2016-C01, Class 1M2
6.898% (LIBOR 1 Month + 6.75%), 08/25/2028(i)

   40   43,234 

Series 2016-C02, Class 1M2
6.148% (LIBOR 1 Month + 6.00%), 09/25/2028(i)

   75   79,475 

Series 2016-C06, Class 1M2
4.398% (LIBOR 1 Month + 4.25%), 04/25/2029(i)

   88   92,454 

Series 2017-C01, Class 1M2
3.698% (LIBOR 1 Month + 3.55%), 07/25/2029(i)

   59   60,270 

Series 2017-C02, Class 2M2
3.798% (LIBOR 1 Month + 3.65%), 09/25/2029(i)

   125   127,480 

Series 2017-C05, Class 1M2
2.348% (LIBOR 1 Month + 2.20%), 01/25/2030(i)

   109   109,258 

JP Morgan Madison Avenue Securities Trust
Series 2014-CH1, Class M2
4.398% (LIBOR 1 Month + 4.25%), 11/25/2024(i)(j)

   16   15,088 

PMT Credit Risk Transfer Trust
Series 2019-1R, Class A
2.145% (LIBOR 1 Month + 2.00%), 03/27/2024(i)(j)

   85   80,697 

Radnor Re Ltd.
Series 2019-1, Class M1B
2.098% (LIBOR 1 Month + 1.95%), 02/25/2029(e)(i)

   140   140,500 

 

22


  AB Variable Products Series Fund

 

      
Principal
Amount
(000)
  U.S. $ Value 
                                           

STACR Trust
Series 2018-DNA3, Class M2
2.248% (LIBOR 1 Month + 2.10%), 09/25/2048(e)(i)

  U.S.$   174  $172,022 

Wells Fargo Credit Risk Transfer Securities Trust
Series 2015-WF1, Class 1M2
5.398% (LIBOR 1 Month + 5.25%), 11/25/2025(i)(j)

   73   71,383 

Series 2015-WF1, Class 2M2
5.648% (LIBOR 1 Month + 5.50%), 11/25/2025(i)(j)

   21   20,501 
   

 

 

 
    2,486,928 
   

 

 

 

AGENCY FLOATING RATE–0.4%

   

Federal Home Loan Mortgage Corp. REMICs
Series 4416, Class BS
5.941% (6.10%–LIBOR 1 Month), 12/15/2044(i)(k)

   423   84,254 

Series 4693, Class SL
5.991% (6.15%–LIBOR 1 Month), 06/15/2047(i)(k)

   425   97,684 

Series 4719, Class JS
5.991% (6.15%–LIBOR 1 Month), 09/15/2047(i)(k)

   301   51,909 

Series 4727, Class SA
6.041% (6.20%–LIBOR 1 Month), 11/15/2047(i)(k)

   445   90,996 

Federal National Mortgage Association REMICs
Series 2011-131, Class ST
6.392% (6.54%–LIBOR 1 Month), 12/25/2041(i)(k)

   213   51,202 

Series 2016-106, Class ES
5.852% (6.00%–LIBOR 1 Month), 01/25/2047(i)(k)

   399   74,308 

Series 2017-16, Class SG
5.902% (6.05%–LIBOR 1 Month), 03/25/2047(i)(k)

   400   81,464 
                                           

Series 2017-81, Class SA
6.052% (6.20%–LIBOR 1 Month), 10/25/2047(i)(k)

  U.S.$   429  96,463 

Series 2017-97, Class LS
6.052% (6.20%–LIBOR 1 Month), 12/25/2047(i)(k)

   349   86,583 

Government National Mortgage Association
Series 2017-134, Class SE
6.048% (6.20%–LIBOR 1 Month), 09/20/2047(i)(k)

   272   46,729 

Series 2017-65, Class ST
5.998% (6.15%–LIBOR 1 Month), 04/20/2047(i)(k)

   390   83,204 
   

 

 

 
    844,796 
   

 

 

 

NON-AGENCY FIXED RATE–0.1%

   

Alternative Loan Trust
Series 2005-20CB, Class 3A6
5.50%, 07/25/2035

   19   16,945 

Series 2006-24CB, Class A16
5.75%, 08/25/2036

   91   72,449 

Series 2006-28CB, Class A14
6.25%, 10/25/2036

   66   48,769 

Series 2006-J1, Class 1A13
5.50%, 02/25/2036

   43   39,916 

Chase Mortgage Finance Trust
Series 2007-S5, Class 1A17
6.00%, 07/25/2037

   30   21,649 

Countrywide Home Loan Mortgage Pass-Through Trust
Series 2006-10, Class 1A8
6.00%, 05/25/2036

   42   31,142 

Series 2006-13, Class 1A19
6.25%, 09/25/2036

   21   13,752 

First Horizon Alternative Mortgage Securities Trust
Series 2006-FA3, Class A9
6.00%, 07/25/2036

   81   55,404 
   

 

 

 
    300,026 
   

 

 

 

 

23


BALANCED WEALTH STRATEGY PORTFOLIO
PORTFOLIO OF INVESTMENTS 
(continued) AB Variable Products Series Fund

 

      
Principal
Amount
(000)
  U.S. $ Value 
                                           

NON-AGENCY FLOATING RATE–0.1%

 

  

Deutsche Alt-A Securities Mortgage Loan Trust
Series 2006-AR4, Class A2
0.528% (LIBOR 1 Month + 0.19%), 12/25/2036(i)

  U.S.$   212  $107,054 

HomeBanc Mortgage Trust
Series 2005-1, Class A1
0.648% (LIBOR 1 Month + 0.25%), 03/25/2035(i)

   52   46,871 
   

 

 

 
    153,925 
   

 

 

 

Total Collateralized Mortgage Obligations
(cost $3,781,478)

    3,785,675 
   

 

 

 

MORTGAGE PASS-THROUGHS–1.6%

 

  

AGENCY FIXED RATE 30-YEAR–1.6%

 

  

Federal Home Loan Mortgage Corp.
Series 2019
3.50%, 06/01/2049-10/01/2049

   719   779,339 

Series 2020
2.50%, 07/01/2050

   136   146,089 

Federal Home Loan Mortgage Corp. Gold
Series 2018
4.00%, 08/01/2048

   53   57,301 

Series 2019
4.50%, 02/01/2049

   183   202,589 

Federal National Mortgage Association
Series 2012
3.50%, 11/01/2042

   298   328,964 

Series 2013
3.50%, 04/01/2043

   192   212,120 

Series 2018
3.50%, 02/01/2048

   175   185,477 

4.50%, 09/01/2048

   390   428,794 

Series 2019
3.50%, 11/01/2049

   175   188,388 

Series 2020
2.50%, 07/01/2050

   773   833,740 

Uniform Mortgage-Backed Security
Series 2021
1.50%, 01/01/2051, TBA

   399   403,177 
   

 

 

 

Total Mortgage Pass-Throughs
(cost $3,650,758)

    3,765,978 
   

 

 

 
                                           

COMMERCIAL MORTGAGE-BACKED SECURITIES–0.9%

   

NON-AGENCY FLOATING RATE CMBS–0.6%

   

Ashford Hospitality Trust
Series 2018-KEYS, Class A
1.159% (LIBOR 1 Month + 1.00%), 06/15/2035(e)(i)

  U.S.$   200  193,895 

BAMLL Commercial Mortgage Securities Trust Series 2017-SCH, Class AF
1.159% (LIBOR 1 Month + 1.00%), 11/15/2033(e)(i)

   375   358,665 

BHMS
Series 2018-ATLS, Class A
1.409% (LIBOR 1 Month + 1.25%), 07/15/2035(e)(i)

   158   153,688 

BX Trust
Series 2018-EXCL, Class A
1.246% (LIBOR 1 Month + 1.09%), 09/15/2037(e)(i)

   163   150,779 

DBWF Mortgage Trust
Series 2018-GLKS, Class A
1.182% (LIBOR 1 Month + 1.03%), 12/19/2030(e)(i)

   166   163,544 

Invitation Homes Trust
Series 2018-SFR4, Class A
1.253% (LIBOR 1 Month + 1.10%), 01/17/2038(e)(i)

   213   214,090 

Morgan Stanley Capital I Trust
Series 2015-XLF2, Class SNMA
2.109% (LIBOR 1 Month + 1.95%), 11/15/2026(i)(j)

   90   79,891 

Starwood Retail Property Trust
Series 2014-STAR, Class A
1.629% (LIBOR 1 Month + 1.47%), 11/15/2027(e)(i)

   176   115,987 
   

 

 

 
    1,430,539 
   

 

 

 

 

24


  AB Variable Products Series Fund

 

      
Principal
Amount
(000)
  U.S. $ Value 
                                           

NON-AGENCY
FIXED RATE CMBS–0.3%

 

GS Mortgage Securities Trust
Series 2013-G1, Class A2
3.557%, 04/10/2031(e)

  U.S.$   276  $274,006 

JP Morgan Chase Commercial Mortgage Securities Trust
Series 2012-C6, Class E
5.152%, 05/15/2045(e)

   119   70,757 

LSTAR Commercial Mortgage Trust
Series 2016-4, Class A2
2.579%, 03/10/2049(e)

   143   145,473 

Wells Fargo Commercial Mortgage Trust
Series 2015-SG1, Class C
4.462%, 09/15/2048

   197   172,600 
   

 

 

 
    662,836 
   

 

 

 

Total Commercial Mortgage-Backed Securities
(cost $2,268,259)

    2,093,375 
   

 

 

 

EMERGING MARKETS–CORPORATE BONDS–0.4%

 

  

INDUSTRIAL–0.4%

   

CAPITAL GOODS–0.1%

   

Embraer Netherlands Finance BV
6.95%, 01/17/2028(e)

   200   226,000 
   

 

 

 

COMMUNICATIONS–MEDIA–0.1%

   

Globo Comunicacao e Participacoes SA
4.875%, 01/22/2030(e)

   200   214,062 
   

 

 

 

CONSUMER NON-CYCLICAL–0.1%

   

BRF GmbH
4.35%, 09/29/2026(e)

   200   210,750 
   

 

 

 

ENERGY–0.0%

   

Leviathan Bond Ltd.
6.125%, 06/30/2025(e)

   46   50,427 
   

 

 

 

TRANSPORTATION–SERVICES–0.1%

 

  

Rumo Luxembourg SARL
5.875%, 01/18/2025(e)

   200   211,563 
   

 

 

 
    912,802 
   

 

 

 

UTILITY–0.0%

   

ELECTRIC–0.0%

   

Terraform Global Operating LLC
6.125%, 03/01/2026(j)

   14   14,375 
   

 

 

 

Total Emerging Markets–Corporate Bonds
(cost $893,196)

    927,177 
   

 

 

 
                                           

COLLATERALIZED LOAN OBLIGATIONS–0.4%

 

  

CLO–FLOATING RATE–0.4%

   

ICG US CLO Ltd.
Series 2015-1A, Class A1R
1.358% (LIBOR 3 Month + 1.14%), 10/19/2028(e)(i)

  U.S.$   300  299,999 

Octagon Loan Funding Ltd.
Series 2014-1A, Class ARR
1.40% (LIBOR 3 Month + 1.18%), 11/18/2031(e)(i)

   320   320,003 

TIAA CLO IV Ltd.
Series 2018-1A, Class A1A
1.448% (LIBOR 3 Month + 1.23%), 01/20/2032(e)(i)

   250   248,961 
   

 

 

 

Total Collateralized Loan Obligations
(cost $870,000)

    868,963 
   

 

 

 

GOVERNMENTS–SOVEREIGN BONDS–0.3%

 

  

CHILE–0.1%

   

Chile Government International Bond
1.625%, 01/30/2025

  EUR   125   162,632 
   

 

 

 

MEXICO–0.1%

   

Mexico Government International Bond
4.75%, 04/27/2032

  U.S.$   280   336,525 
   

 

 

 

PERU–0.1%

   

Peruvian Government International Bond
2.392%, 01/23/2026

   205   218,120 
   

 

 

 

Total Governments–Sovereign Bonds
(cost $665,585)

    717,277 
   

 

 

 

EMERGING MARKETS–SOVEREIGNS–0.3%

 

  

IVORY COAST–0.1%

   

Ivory Coast Government International Bond
5.875%, 10/17/2031(e)

  EUR   200   269,908 
   

 

 

 

NIGERIA–0.1%

   

Nigeria Government International Bond
6.75%, 01/28/2021(e)

  U.S.$   200   199,938 
   

 

 

 

 

25


BALANCED WEALTH STRATEGY PORTFOLIO
PORTFOLIO OF INVESTMENTS 
(continued) AB Variable Products Series Fund

 

      
Principal
Amount
(000)
  U.S. $ Value 
                                           

SOUTH AFRICA–0.1%

   

Republic of South Africa Government International Bond
4.30%, 10/12/2028(d)

  U.S.$   230  $239,200 
   

 

 

 

Total Emerging Markets–Sovereigns
(cost $603,913)

    709,046 
   

 

 

 

COVERED BONDS–0.2%

   

Turkiye Vakiflar Bankasi TAO
2.375%, 05/04/2021(e)

  EUR   140   170,597 

UBS AG/London
4.00%, 04/08/2022(e)

   158   203,934 

1.375%, 04/16/2021(e)

   140   171,937 
   

 

 

 

Total Covered Bonds
(cost $502,554)

    546,468 
   

 

 

 

EMERGING MARKETS–TREASURIES–0.1%

   

SOUTH AFRICA–0.1%

   

Republic of South Africa Government Bond
Series 2030
8.00%, 01/31/2030
(cost $251,095)

  ZAR   5,315   344,860 
   

 

 

 

GOVERNMENTS–SOVEREIGN AGENCIES–0.1%

 

  

CANADA–0.1%

   

Canada Housing Trust No. 1 1.80%, 12/15/2024(e)

  CAD   200   165,066 

1.95%, 12/15/2025(e)

   195   163,097 
   

 

 

 

Total Governments–Sovereign Agencies
(cost $325,981)

    328,163 
   

 

 

 
                                           

ASSET-BACKED SECURITIES–0.0%

 

  

AUTOS–FIXED RATE–0.0%

   

Flagship Credit Auto Trust
Series 2016-4, Class D
3.89%, 11/15/2022(e)

(cost $99,994)

  U.S.$   100  101,521 
   

 

 

 

SHORT-TERM INVESTMENTS–2.2%

 

  

GOVERNMENTS–TREASURIES–1.5%

 

  

JAPAN–1.5%

   

Japan Treasury Discount Bill
Series 953
Zero Coupon, 03/01/2021

  JPY   295,200   2,859,399 

Series 956
Zero Coupon, 03/15/2021

   85,000   823,369 
   

 

 

 

Total Governments–Treasuries
(cost $3,642,650)

    3,682,768 
 

 

 

 
   Shares    

INVESTMENT COMPANIES–0.7%

 

  

AB Fixed Income Shares, Inc.–Government Money Market Portfolio–Class AB, 0.03%(f)(g)(l)
(cost $1,673,235)

   1,673,235   1,673,235 
  

 

 

 

Total Short-Term Investments
(cost $5,315,885)

    5,356,003 
 

 

 

 

TOTAL INVESTMENTS–100.3%
(cost $207,463,105)

    244,411,705 

Other assets less liabilities–(0.3)%

    (732,381
 

 

 

 

NET ASSETS–100.0%

   $243,679,324 
 

 

 

 

FUTURES (see Note D)

 

Description  Number of
Contracts
   Expiration
Month
   Current
Notional
   Value and
Unrealized
Appreciation/
(Depreciation)
 

Purchased Contracts

        

Euro-BOBL Futures

   26    March 2021   $  4,293,709   $4,733 

Euro-Schatz Futures

   5    March 2021    685,804    (311

U.S. T-Note 5 Yr (CBT) Futures

   14    March 2021    1,766,297    4,029 

Sold Contracts

 

Euro-Bund Futures

   11    March 2021    2,387,153    (6,109

U.S. 10 Yr Ultra Futures

   8    March 2021    1,250,875    3,927 

U.S. Ultra Bond (CBT) Futures

   5    March 2021    1,067,813    5,290 
        

 

 

 
        $  11,559 
        

 

 

 

 

26


  AB Variable Products Series Fund

 

FORWARD CURRENCY EXCHANGE CONTRACTS (see Note D)

 

Counterparty    Contracts to
Deliver
(000)
     In Exchange
For
(000)
     Settlement
Date
     Unrealized
Appreciation/
(Depreciation)
 

Bank of America, NA

     RUB    40,785      USD    552      01/22/2021     $1,386 

Barclays Bank PLC

     USD    575      CNY    3,766      02/10/2021      1,839 

Barclays Bank PLC

     USD    238      IDR    3,531,771      01/15/2021      15,610 

BNP Paribas SA

     NOK    3,888      USD    408      01/15/2021      (45,480

BNP Paribas SA

     AUD    879      USD    644      01/12/2021      (34,038

BNP Paribas SA

     SGD    818      USD    613      01/07/2021      (5,211

BNP Paribas SA

     USD    1,457      SGD    1,961      01/07/2021      26,666 

BNP Paribas SA

     USD    662      SEK    5,611      01/15/2021      20,077 

BNP Paribas SA

     USD    552      ZAR    8,104      02/04/2021      (2,893

BNP Paribas SA

     USD    571      ZAR    8,702      02/04/2021      18,900 

Citibank, NA

     IDR    9,172,354      USD    651      01/15/2021      (7,993

Citibank, NA

     COP    1,976,748      USD    556      01/14/2021      (22,921

Citibank, NA

     JPY    1,055,879      USD    10,145      02/26/2021      (86,685

Citibank, NA

     KRW    896,039      USD    820      01/14/2021      (4,114

Citibank, NA

     CLP    1,471,700      USD    1,937      01/14/2021        (134,193

Citibank, NA

     CNY    43,138      USD    6,582      02/10/2021      (23,086

Citibank, NA

     PEN    499      USD    139      01/14/2021      1,020 

Citibank, NA

     USD    233      PEN    839      01/14/2021      (1,741

Citibank, NA

     USD    881      CNY    5,746      02/10/2021      (1,118

Citibank, NA

     USD    1,630      CLP    1,226,062      01/14/2021      95,689 

Citibank, NA

     USD    409      KRW    465,430      01/14/2021      18,655 

Citibank, NA

     USD    732      COP    2,548,046      01/14/2021      13,668 

Credit Suisse International

     SGD    981      USD    718      01/07/2021      (24,591

Credit Suisse International

     USD    730      SGD    984      01/07/2021      14,969 

Credit Suisse International

     USD    203      TRY    1,604      01/21/2021      11,910 

Goldman Sachs Bank USA

     TWD    18,390      USD    655      01/27/2021      (2,006

Goldman Sachs Bank USA

     NOK    8,844      USD    963      01/15/2021      (68,906

Goldman Sachs Bank USA

     USD    722      SGD    981      01/07/2021      20,587 

Goldman Sachs Bank USA

     USD    1,311      RUB    100,998      01/22/2021      52,855 

JPMorgan Chase Bank, NA

     SEK    8,164      USD    947      01/15/2021      (45,360

JPMorgan Chase Bank, NA

     SGD    1,856      USD    1,376      01/07/2021      (28,254

JPMorgan Chase Bank, NA

     GBP    651      USD    870      01/21/2021      (21,029

JPMorgan Chase Bank, NA

     USD    759      CHF    675      01/29/2021      4,464 

JPMorgan Chase Bank, NA

     USD    669      AUD    905      01/12/2021      28,885 

JPMorgan Chase Bank, NA

     USD    826      CNY    5,400      02/10/2021      343 

JPMorgan Chase Bank, NA

     USD    657      NOK    5,810      01/15/2021      20,924 

JPMorgan Chase Bank, NA

     USD    729      SEK    6,286      01/15/2021      35,173 

Morgan Stanley & Co., Inc.

     JPY    150,922      USD    1,449      02/26/2021      (13,826

Morgan Stanley & Co., Inc.

     NOK    7,813      USD    878      01/15/2021      (32,976

Morgan Stanley & Co., Inc.

     SEK    10,070      USD    1,148      01/15/2021      (76,577

Morgan Stanley & Co., Inc.

     BRL    4,023      USD    774      01/05/2021      (373

Morgan Stanley & Co., Inc.

     GBP    3,128      USD    4,148      01/21/2021      (130,138

Morgan Stanley & Co., Inc.

     MYR    1,237      USD    297      03/25/2021      (12,146

Morgan Stanley & Co., Inc.

     NZD    1,158      USD    826      03/05/2021      (7,824

Morgan Stanley & Co., Inc.

     AUD    1,091      USD    828      01/12/2021      (13,218

Morgan Stanley & Co., Inc.

     USD    751      BRL    4,023      01/05/2021      23,503 

Morgan Stanley & Co., Inc.

     USD    1,607      NOK    14,733      01/15/2021      110,953 

Natwest Markets PLC

     CNY    1,026      USD    156      02/10/2021      (588

 

27


BALANCED WEALTH STRATEGY PORTFOLIO
PORTFOLIO OF INVESTMENTS 
(continued) AB Variable Products Series Fund

 

Counterparty    Contracts to
Deliver
(000)
     In Exchange
For
(000)
     Settlement
Date
     Unrealized
Appreciation/
(Depreciation)
 

Natwest Markets PLC

     USD    652      INR    48,735      01/15/2021     $14,972 

Standard Chartered Bank

     INR    29,773      USD    401      01/15/2021      (5,987

Standard Chartered Bank

     USD    663      TWD    18,661      01/27/2021      3,731 

Standard Chartered Bank

     USD    558      INR    41,450      01/15/2021      8,838 

Standard Chartered Bank

     USD    789      KRW    878,905      01/14/2021      19,183 

Standard Chartered Bank

     USD    1,202      IDR    17,283,590      01/15/2021      39,342 

State Street Bank & Trust Co.

     JPY    89,756      USD    866      02/26/2021      (3,897

State Street Bank & Trust Co.

     ZAR    19,197      USD    1,239      02/04/2021      (61,424

State Street Bank & Trust Co.

     AUD    4,429      USD    3,193      01/12/2021      (221,616

State Street Bank & Trust Co.

     JPY    4,562      USD    44      02/26/2021      152 

State Street Bank & Trust Co.

     CHF    1,346      USD    1,483      01/29/2021      (38,060

State Street Bank & Trust Co.

     MXN    1,634      USD    82      02/25/2021      506 

State Street Bank & Trust Co.

     SEK    1,200      USD    139      01/15/2021      (7,367

State Street Bank & Trust Co.

     DKK    559      USD    88      01/15/2021      (3,323

State Street Bank & Trust Co.

     NOK    328      USD    36      01/15/2021      (2,742

State Street Bank & Trust Co.

     SGD    297      USD    223      01/07/2021      (1,834

State Street Bank & Trust Co.

     CAD    271      USD    212      02/18/2021      (457

State Street Bank & Trust Co.

     EUR    183      USD    224      03/17/2021      (208

State Street Bank & Trust Co.

     ILS    38      USD    11      01/21/2021      (497

State Street Bank & Trust Co.

     GBP    34      USD    46      01/21/2021      (221

State Street Bank & Trust Co.

     NZD    9      USD    6      03/05/2021      (64

State Street Bank & Trust Co.

     USD    124      AUD    173      01/12/2021      9,432 

State Street Bank & Trust Co.

     USD    1,310      GBP    980      01/21/2021      30,831 

State Street Bank & Trust Co.

     USD    11      ILS    38      01/21/2021      503 

State Street Bank & Trust Co.

     USD    205      CAD    262      02/18/2021      141 

State Street Bank & Trust Co.

     USD    573      CHF    511      01/29/2021      4,478 

State Street Bank & Trust Co.

     USD    12      HKD    96      02/24/2021      0 

State Street Bank & Trust Co.

     USD    823      SEK    6,940      01/15/2021      20,258 

State Street Bank & Trust Co.

     USD    124      SGD    169      01/07/2021      3,419 

State Street Bank & Trust Co.

     USD    457      EUR    375      03/17/2021      1,146 

State Street Bank & Trust Co.

     USD    488      PLN    1,797      03/24/2021      (6,573

State Street Bank & Trust Co.

     USD    92      JPY    9,558      02/26/2021      560 

State Street Bank & Trust Co.

     USD    765      BRL    4,023      02/02/2021      9,117 

State Street Bank & Trust Co.

     USD    598      ZAR    9,012      02/04/2021      12,660 

State Street Bank & Trust Co.

     USD    400      MXN    8,103      02/25/2021      5,257 

UBS AG

     COP    2,237,895      USD    597      01/14/2021      (57,812

UBS AG

     EUR    11,290      USD    13,792      03/17/2021      (23,429

UBS AG

     CAD    4,308      USD    3,365      02/18/2021      (19,823
                    

 

 

 
    $  (580,017
                    

 

 

 

CENTRALLY CLEARED INTEREST RATE SWAPS (see Note D)

 

           Rate Type           
Notional
Amount (000)
   Termination
Date
   Payments
made
by the
Fund
  Payments
received
by the
Fund
 Payment
Frequency
Paid/
Received
 Market
Value
  Upfront
Premiums
Paid
(Received)
  Unrealized
Appreciation/
(Depreciation)
 
BRL   2,816    01/02/2023   1 Day CDI  3.975% Maturity $  1,429  $    –0–  $  1,429 
BRL   2,815    01/02/2023   1 Day CDI  4.590% Maturity  7,757   –0–   7,757 
BRL   2,592    01/02/2023   1 Day CDI  4.175% Maturity  3,339   –0–   3,339 

 

28


  AB Variable Products Series Fund

 

           Rate Type            
Notional
Amount (000)
   Termination
Date
   Payments
made
by the
Fund
  Payments
received
by the
Fund
  Payment
Frequency
Paid/
Received
 Market
Value
  Upfront
Premiums
Paid
(Received)
  Unrealized
Appreciation/
(Depreciation)
 
BRL   2,577    01/02/2023    1 Day CDI   4.053%  Maturity $2,104  $–0–  $2,104 
CAD   3,780    05/22/2024    3 Month CDOR   1.980%  

Semi-Annual/

Semi-Annual

  139,416   2   139,414 
USD   2,420    10/01/2025    0.329%   3 Month LIBOR  Semi-Annual/
Quarterly
  7,474   –0–   7,474 
EUR   540    09/30/2050    6 Month EURIBOR   (0.017)%  

Semi-Annual/

Annual

  1,302   –0–   1,302 
EUR   540    09/30/2050    0.122%   6 Month EURIBOR  

Annual/

Semi-Annual

  (29,503  –0–   (29,503
EUR   550    11/10/2050    6 Month EURIBOR   (0.043)%  

Semi-Annual/

Annual

  (4,318  –0–   (4,318
EUR   550    11/10/2050    0.022%   6 Month EURIBOR  

Annual/

Semi-Annual

  (8,898  6,597   (15,495
         

 

 

  

 

 

  

 

 

 
         $  120,102  $  6,599  $  113,503 
         

 

 

  

 

 

  

 

 

 

CREDIT DEFAULT SWAPS (see Note D)

 

Swap Counterparty &
Referenced Obligation
 Fixed
Rate
(Pay)
Receive
  Payment
Frequency
  Implied
Credit
Spread at
December 31,
2020
  Notional
Amount
(000)
  Market
Value
  Upfront
Premiums
Paid
(Received)
  Unrealized
Appreciation/
(Depreciation)
 

Sale Contracts

        

Citigroup Global Markets, Inc.

        

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00  Monthly   15.00  USD   60  $  (15,990 $(7,769 $  (8,221

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00   Monthly   15.00   USD   55   (14,657  (7,291  (7,366

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00   Monthly   15.00   USD   69   (18,382    (10,342  (8,040

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00   Monthly   15.00   USD   11   (2,931  (1,730  (1,201

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00   Monthly   15.00   USD   70   (18,650  (10,186  (8,464

Deutsche Bank AG

 

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00   Monthly   15.00   USD   9   (2,398  (504  (1,894

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00   Monthly   15.00   USD   8   (2,132  (916  (1,216

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00   Monthly   15.00   USD   53   (14,124  (5,919  (8,205

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00   Monthly   15.00   USD   52   (13,858  (5,805  (8,053

Goldman Sachs International

 

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00   Monthly   15.00   USD   4   (1,066  (350  (716

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00   Monthly   15.00   USD   8   (2,132  (713  (1,419

 

29


BALANCED WEALTH STRATEGY PORTFOLIO
PORTFOLIO OF INVESTMENTS 
(continued) AB Variable Products Series Fund

 

Swap Counterparty &
Referenced Obligation
 Fixed
Rate
(Pay)
Receive
  Payment
Frequency
  Implied
Credit
Spread at
December 31,
2020
  Notional
Amount
(000)
  Market
Value
  Upfront
Premiums
Paid
(Received)
  Unrealized
Appreciation/
(Depreciation)
 

Sale Contracts (continued)

        

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00%    Monthly   15.00%    USD   8  $(2,133 $(772 $(1,361

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00   Monthly   15.00   USD   15   (3,997  (1,581  (2,416

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00   Monthly   15.00   USD   78   (20,787  (10,365  (10,422

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00   Monthly   15.00   USD   53   (14,124  (5,513  (8,611

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00   Monthly   15.00   USD   75   (19,982  (11,257  (8,725

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00   Monthly   15.00   USD   58   (15,452  (9,256  (6,196

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00   Monthly   15.00   USD   82   (21,846  (13,274  (8,572

CDX-CMBX.NA.BBB- Series 6, 05/11/2063*

  3.00   Monthly   15.00   USD   5   (1,332  (741  (591
      

 

 

  

 

 

  

 

 

 
       $  (205,973)   $  (104,284)   $  (101,689) 
      

 

 

  

 

 

  

 

 

 

 

* Termination date

INFLATION (CPI) SWAPS (see Note D)

 

           Rate Type             
Swap Counterparty Notional
Amount
(000)
  Termination
Date
  Payments
made
by the
Fund
  Payments
received
by the
Fund
  Payment
Frequency
Paid
Received
  Market
Value
  Upfront
Premiums
Paid
(Received)
  Unrealized
Appreciation/
(Depreciation)
 

Bank of America, NA

  USD   10,000   07/11/2024   2.416  CPI  Maturity  $(310,311 $            –0–  $  (310,311

 

# Variable interest rate based on the rate of inflation as determined by the Consumer Price Index (CPI).

 

 

 

(a) Non-income producing security.

 

(b) Security in which significant unobservable inputs (Level 3) were used in determining fair value.

 

(c) Fair valued by the Adviser.

 

(d) Represents entire or partial securities out on loan. See Note E for securities lending information.

 

(e) Security is exempt from registration under Rule 144A of the Securities Act of 1933. These securities are considered restricted, but liquid and may be resold in transactions exempt from registration, normally to qualified institutional buyers. At December 31, 2020, the aggregate market value of these securities amounted to $35,715,851 or 14.7% of net assets.

 

(f) Affiliated investments.

 

(g) To obtain a copy of the fund’s shareholder report, please go to the Securities and Exchange Commission’s website at www.sec.gov, or call AB at (800) 227-4618.

 

(h) Securities are perpetual and, thus, do not have a predetermined maturity date. The date shown, if applicable, reflects the next call date.

 

(i) Floating Rate Security. Stated interest/floor/ceiling rate was in effect at December 31, 2020.

 

(j) Security is exempt from registration under Rule 144A of the Securities Act of 1933. These securities, which represent 0.12% of net assets as of December 31, 2020, are considered illiquid and restricted. Additional information regarding such securities follows:

 

144A/Restricted & Illiquid Securities  Acquisition
Date
   Cost   Market
Value
   Percentage
of Net Assets
 

JP Morgan Madison Avenue Securities Trust Series 2014-CH1, Class M2
4.398%, 11/25/2024

   11/06/2015   $  15,596   $  15,088    0.01

 

30


  AB Variable Products Series Fund

 

144A/Restricted & Illiquid Securities  Acquisition
Date
   Cost   Market
Value
   Percentage
of Net Assets
 

Morgan Stanley Capital I Trust Series 2015-XLF2, Class SNMA
2.109%, 11/15/2026

   11/16/2015   $  89,652   $  79,891    0.03

PMT Credit Risk Transfer Trust Series 2019-1R, Class A
2.145%, 03/27/2024

   03/21/2019    84,673    80,697    0.03

Terraform Global Operating LLC
6.125%, 03/01/2026

   02/08/2018    14,000    14,375    0.01

Wells Fargo Credit Risk Transfer Securities Trust Series 2015-WF1, Class 1M2
5.398%, 11/25/2025

   09/28/2015    73,154    71,383    0.03

Wells Fargo Credit Risk Transfer Securities Trust Series 2015-WF1, Class 2M2
5.648%, 11/25/2025

   09/28/2015    20,732    20,501    0.01

 

(k) Inverse interest only security.

 

(l) The rate shown represents the 7-day yield as of period end.

Currency Abbreviations:

AUD—Australian Dollar

BRL—Brazilian Real

CAD—Canadian Dollar

CHF—Swiss Franc

CLP—Chilean Peso

CNY—Chinese Yuan Renminbi

COP—Colombian Peso

DKK—Danish Krone

EUR—Euro

GBP—Great British Pound

HKD—Hong Kong Dollar

IDR—Indonesian Rupiah

ILS—Israeli Shekel

INR—Indian Rupee

JPY—Japanese Yen

KRW—South Korean Won

MXN—Mexican Peso

MYR—Malaysian Ringgit

NOK—Norwegian Krone

NZD—New Zealand Dollar

PEN—Peruvian Sol

PLN—Polish Zloty

RUB—Russian Ruble

SEK—Swedish Krona

SGD—Singapore Dollar

TRY—Turkish Lira

TWD—New Taiwan Dollar

USD—United States Dollar

ZAR—South African Rand

Glossary:

ADR—American Depositary Receipt

BOBL—Bundesobligationen

CBT—Chicago Board of Trade

CDI—Brazil CETIP Interbank Deposit Rate

CDOR—Canadian Dealer Offered Rate

CDX-CMBX.NA—North American Commercial Mortgage-Backed Index

CLO—Collateralized Loan Obligations

CMBS—Commercial Mortgage-Backed Securities

 

31


BALANCED WEALTH STRATEGY PORTFOLIO
PORTFOLIO OF INVESTMENTS 
(continued) AB Variable Products Series Fund

 

CPI—Consumer Price Index

EURIBOR—Euro Interbank Offered Rate

GDR—Global Depositary Receipt

LIBOR—London Interbank Offered Rate

OAT—Obligations Assimilables du Trésor

PJSC—Public Joint Stock Company

REIT—Real Estate Investment Trust

REMICs—Real Estate Mortgage Investment Conduits

TBA—To Be Announced

See notes to financial statements.

 

32


BALANCED WEALTH STRATEGY PORTFOLIO
STATEMENT OF ASSETS & LIABILITIES 
December 31, 2020 AB Variable Products Series Fund

 

ASSETS

  

Investments in securities, at value

  

Unaffiliated issuers (cost $142,674,755)

  $178,117,495(a) 

Affiliated issuers (cost $64,788,350)

   66,294,210 

Cash

   2,926 

Cash collateral due from broker

   623,074 

Foreign currencies, at value (cost $165,972)

   167,008 

Receivable for investment securities sold and foreign currency transactions

   1,861,673 

Unaffiliated interest and dividends receivable

   727,104 

Unrealized appreciation on forward currency exchange contracts

   722,602 

Receivable for variation margin on centrally cleared swaps

   737 

Affiliated dividends receivable

   18 
  

 

 

 

Total assets

   248,516,847 
  

 

 

 

LIABILITIES

  

Payable for investment securities purchased and foreign currency transactions

   2,629,738 

Unrealized depreciation on forward currency exchange contracts

   1,302,619 

Unrealized depreciation on inflation swaps

   310,311 

Market value on credit default swaps (net premiums received $104,284)

   205,973 

Advisory fee payable

   68,661 

Payable for capital stock redeemed

   64,380 

Distribution fee payable

   46,744 

Administrative fee payable

   20,475 

Payable for variation margin on futures

   4,587 

Transfer Agent fee payable

   146 

Accrued expenses and other liabilities

   183,889 
  

 

 

 

Total liabilities

   4,837,523 
  

 

 

 

NET ASSETS

  $243,679,324 
  

 

 

 

COMPOSITION OF NET ASSETS

 

Capital stock, at par

  $23,255 

Additional paid-in capital

   201,311,416 

Distributable earnings

   42,344,653 
  

 

 

 
  $243,679,324 
  

 

 

 

Net Asset Value Per Share—1 billion shares of capital stock authorized, $.001 par value

 

Class    Net Assets     Shares
Outstanding
     Net Asset
Value
 
A    $21,252,348      2,002,120     $10.61 
B    $  222,426,976      21,253,018     $  10.47 

 

 

 

(a) Includes securities on loan with a value of $646,459 (see Note E).

See notes to financial statements.

 

33


BALANCED WEALTH STRATEGY PORTFOLIO
STATEMENT OF OPERATIONS 
Year Ended December 31, 2020 AB Variable Products Series Fund

 

INVESTMENT INCOME

  

Dividends

  

Unaffiliated issuers (net of foreign taxes withheld of $39,067)

  $1,777,202 

Affiliated issuers

   685,624 

Interest (net of foreign taxes withheld of $3,306)

   2,020,484 

Securities lending income

   2,298 
  

 

 

 
   4,485,608 
  

 

 

 

EXPENSES

  

Advisory fee (see Note B)

   1,274,223 

Distribution fee—Class B

   526,074 

Transfer agency—Class A

   547 

Transfer agency—Class B

   5,438 

Custody and accounting

   177,826 

Audit and tax

   101,259 

Administrative

   73,979 

Printing

   67,896 

Legal

   32,880 

Directors’ fees

   19,473 

Miscellaneous

   26,167 
  

 

 

 

Total expenses

   2,305,762 

Less: expenses waived and reimbursed by the Adviser (see Notes B & E)

   (505,784
  

 

 

 

Net expenses

   1,799,978 
  

 

 

 

Net investment income

   2,685,630 
  

 

 

 

REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENT AND FOREIGN CURRENCY TRANSACTIONS

  

Net realized gain (loss) on:

  

Affiliated Underlying Portfolios

   (242,354

Investment transactions(a)

   5,602,505 

Forward currency exchange contracts

   (846,012

Futures

   1,261,034 

Swaps

   (1,329,291

Swaptions written

   70,092 

Foreign currency transactions

   (1,525,040

Net realized gain distributions from Affiliated Underlying Portfolios

   412,213 

Net change in unrealized appreciation/depreciation of:

  

Affiliated Underlying Portfolios

   4,127,222 

Investments(b)

   8,449,885 

Forward currency exchange contracts

   157,549 

Futures

   173,913 

Swaps

   398,772 

Foreign currency denominated assets and liabilities

   21,709 
  

 

 

 

Net gain on investment and foreign currency transactions

   16,732,197 
  

 

 

 

NET INCREASE IN NET ASSETS FROM OPERATIONS

  $19,417,827 
  

 

 

 

 

 

 

(a) Net of foreign capital gains taxes of $3,327.

 

(b) Net of increase in accrued foreign capital gains taxes of $2,061.

See notes to financial statements.

 

34


BALANCED WEALTH STRATEGY PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS AB Variable Products Series Fund

 

   Year Ended
December 31,
2020
  Year Ended
December 31,
2019
 

INCREASE IN NET ASSETS FROM OPERATIONS

   

Net investment income

  $2,685,630  $4,063,721 

Net realized gain on investment and foreign currency transactions

   2,990,934   8,220,863 

Net realized gain distributions from Affiliated Underlying Portfolios

   412,213   303,518 

Net change in unrealized appreciation/depreciation of investments and foreign currency denominated assets and liabilities

   13,329,050   29,876,573 
  

 

 

  

 

 

 

Net increase in net assets from operations

   19,417,827   42,464,675 

Distributions to Shareholders

 

Class A

   (1,115,680  (3,532,547

Class B

   (10,939,126  (32,838,881

CAPITAL STOCK TRANSACTIONS

 

Net increase (decrease)

   (19,101,220  5,082,781 
  

 

 

  

 

 

 

Total increase (decrease)

   (11,738,199  11,176,028 

NET ASSETS

 

Beginning of period

   255,417,523   244,241,495 
  

 

 

  

 

 

 

End of period

  $243,679,324  $255,417,523 
  

 

 

  

 

 

 

 

 

 

 

 

See notes to financial statements.

 

35


BALANCED WEALTH STRATEGY PORTFOLIO
NOTES TO FINANCIAL STATEMENTS 
December 31, 2020 AB Variable Products Series Fund

 

NOTE A: Significant Accounting Policies

The AB Balanced Wealth Strategy Portfolio (the “Portfolio”) is a series of AB Variable Products Series Fund, Inc. (the “Fund”). The Portfolio’s investment objective is to maximize total return consistent with the determination of AllianceBernstein L.P. (the “Adviser”) of reasonable risk. The Portfolio is diversified as defined under the Investment Company Act of 1940. The Fund was incorporated in the State of Maryland as an open-end series investment company. The Fund offers 11 separately managed pools of assets which have differing investment objectives and policies. The Portfolio offers Class A and Class B shares. Both classes of shares have identical voting, dividend, liquidating and other rights, except that Class B shares bear a distribution expense and have exclusive voting rights with respect to the Class B distribution plan.

The Portfolio offers and sells its shares only to separate accounts of certain life insurance companies for the purpose of funding variable annuity contracts and variable life insurance policies. Sales are made without a sales charge at the Portfolio’s net asset value per share.

The financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”), which require management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements and amounts of income and expenses during the reporting period. Actual results could differ from those estimates. The Portfolio is an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. The following is a summary of significant accounting policies followed by the Portfolio.

1. Security Valuation

Portfolio securities are valued at their current market value determined on the basis of market quotations or, if market quotations are not readily available or are deemed unreliable, at “fair value” as determined in accordance with procedures established by and under the general supervision of the Fund’s Board of Directors (the “Board”).

In general, the market values of securities which are readily available and deemed reliable are determined as follows: securities listed on a national securities exchange (other than securities listed on the NASDAQ Stock Market, Inc. (“NASDAQ”)) or on a foreign securities exchange are valued at the last sale price at the close of the exchange or foreign securities exchange. If there has been no sale on such day, the securities are valued at the last traded price from the previous day. Securities listed on more than one exchange are valued by reference to the principal exchange on which the securities are traded; securities listed only on NASDAQ are valued in accordance with the NASDAQ Official Closing Price; listed or over the counter (“OTC”) market put or call options are valued at the mid level between the current bid and ask prices. If either a current bid or current ask price is unavailable, the Adviser will have discretion to determine the best valuation (e.g., last trade price in the case of listed options); open futures are valued using the closing settlement price or, in the absence of such a price, the most recent quoted bid price. If there are no quotations available for the day of valuation, the last available closing settlement price is used; U.S. Government securities and any other debt instruments having 60 days or less remaining until maturity are generally valued at market by an independent pricing vendor, if a market price is available. If a market price is not available, the securities are valued at amortized cost. This methodology is commonly used for short term securities that have an original maturity of 60 days or less, as well as short term securities that had an original term to maturity that exceeded 60 days. In instances when amortized cost is utilized, the Valuation Committee (the “Committee”) must reasonably conclude that the utilization of amortized cost is approximately the same as the fair value of the security. Such factors the Committee will consider include, but are not limited to, an impairment of the creditworthiness of the issuer or material changes in interest rates. Fixed-income securities, including mortgage-backed and asset-backed securities, may be valued on the basis of prices provided by a pricing service or at a price obtained from one or more of the major broker-dealers. In cases where broker-dealer quotes are obtained, the Adviser may establish procedures whereby changes in market yields or spreads are used to adjust, on a daily basis, a recently obtained quoted price on a security. Swaps and other derivatives are valued daily, primarily using independent pricing services, independent pricing models using market inputs, as well as third party broker-dealers or counterparties. Open-end mutual funds are valued at the closing net asset value per share, while exchange traded funds are valued at the closing market price per share.

Securities for which market quotations are not readily available (including restricted securities) or are deemed unreliable are valued at fair value as deemed appropriate by the Adviser. Factors considered in making this determination may include, but are not limited to, information obtained by contacting the issuer, analysts, analysis of the issuer’s financial statements or other available documents. In addition, the Portfolio may use fair value pricing for securities primarily traded in non-U.S. markets because most foreign markets close well before the Portfolio values its securities at 4:00 p.m., Eastern Time. The

 

36


  AB Variable Products Series Fund

 

earlier close of these foreign markets gives rise to the possibility that significant events, including broad market moves, may have occurred in the interim and may materially affect the value of those securities. To account for this, the Portfolio generally values many of its foreign equity securities using fair value prices based on third party vendor modeling tools to the extent available.

2. Fair Value Measurements

In accordance with U.S. GAAP regarding fair value measurements, fair value is defined as the price that the Portfolio would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP establishes a framework for measuring fair value, and a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability (including those valued based on their market values as described in Note A.1 above). Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Portfolio. Unobservable inputs reflect the Portfolio’s own assumptions about the assumptions that market participants would use in pricing the asset or liability based on the best information available in the circumstances. Each investment is assigned a level based upon the observability of the inputs which are significant to the overall valuation. The three-tier hierarchy of inputs is summarized below.

 

  

Level 1—quoted prices in active markets for identical investments

  

Level 2—other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

  

Level 3—significant unobservable inputs (including the Portfolio’s own assumptions in determining the fair value of investments)

The fair value of debt instruments, such as bonds, and over-the-counter derivatives is generally based on market price quotations, recently executed market transactions (where observable) or industry recognized modeling techniques and are generally classified as Level 2. Pricing vendor inputs to Level 2 valuations may include quoted prices for similar investments in active markets, interest rate curves, coupon rates, currency rates, yield curves, option adjusted spreads, default rates, credit spreads and other unique security features in order to estimate the relevant cash flows which are then discounted to calculate fair values. If these inputs are unobservable and significant to the fair value, these investments will be classified as Level 3.

Where readily available market prices or relevant bid prices are not available for certain equity investments, such investments may be valued based on similar publicly traded investments, movements in relevant indices since last available prices or based upon underlying company fundamentals and comparable company data (such as multiples to earnings or other multiples to equity). Where an investment is valued using an observable input, such as another publicly traded security, the investment will be classified as Level 2. If management determines that an adjustment is appropriate based on restrictions on resale, illiquidity or uncertainty, and such adjustment is a significant component of the valuation, the investment will be classified as Level 3. An investment will also be classified as Level 3 where management uses company fundamentals and other significant inputs to determine the valuation.

Valuations of mortgage-backed or other asset-backed securities, by pricing vendors, are based on both proprietary and industry recognized models and discounted cash flow techniques. Significant inputs to the valuation of these instruments are value of the collateral, the rates and timing of delinquencies, the rates and timing of prepayments, and default and loss expectations, which are driven in part by housing prices for residential mortgages. Significant inputs are determined based on relative value analyses, which incorporate comparisons to instruments with similar collateral and risk profiles, including relevant indices. Mortgage and asset-backed securities for which management has collected current observable data through pricing services are generally categorized within Level 2. Those investments for which current observable data has not been provided are classified as Level 3.

Other fixed income investments, including non-U.S. government and corporate debt, are generally valued using quoted market prices, if available, which are typically impacted by current interest rates, maturity dates and any perceived credit risk of the issuer. Additionally, in the absence of quoted market prices, these inputs are used by pricing vendors to derive a valuation based upon industry or proprietary models which incorporate issuer specific data with relevant yield/spread comparisons with more widely quoted bonds with similar key characteristics. Those investments for which there are observable inputs are classified as Level 2. Where the inputs are not observable, the investments are classified as Level 3.

 

37


BALANCED WEALTH STRATEGY PORTFOLIO
NOTES TO FINANCIAL STATEMENTS 
(continued) AB Variable Products Series Fund

 

The following table summarizes the valuation of the Portfolio’s investments by the above fair value hierarchy levels as of December 31, 2020:

 

     Level 1   Level 2   Level 3   Total 

Investments in Securities:

          

Assets:

          

Common Stocks:

          

Information Technology

    $22,711,010   $248,007   $            197   $22,959,214 

Health Care

     11,661,103    224,820    –0–    11,885,923 

Communication Services

     10,725,846    121,123    –0–    10,846,969 

Real Estate

     6,874,726    3,277,517    –0–    10,152,243 

Consumer Discretionary

     9,459,737    437,565    –0–    9,897,302 

Financials

     8,610,039    447,703    –0–    9,057,742 

Industrials

     7,617,222    512,174    –0–    8,129,396 

Materials

     2,310,652    2,114,272    –0–    4,424,924 

Consumer Staples

     4,105,896    305,913    –0–    4,411,809 

Energy

     1,973,492    2,378,574    –0–    4,352,066 

Utilities

     2,070,031    295,342    –0–    2,365,373 

Consumer Services

     75,106    –0–    –0–    75,106 

Transportation

     –0–    73,744    –0–    73,744 

Consumer Durables & Apparel

     35,789    35,856    –0–    71,645 

Software & Services

     32,774    –0–    –0–    32,774 

Investment Companies

     64,620,975    –0–    –0–    64,620,975 

Governments—Treasuries

     –0–    29,076,965    –0–    29,076,965 

Corporates—Investment Grade

     –0–    22,792,366    –0–    22,792,366 

Corporates—Non-Investment Grade

     –0–    5,221,377    –0–    5,221,377 

Quasi-Sovereigns

     –0–    4,419,286    –0–    4,419,286 

Collateralized Mortgage Obligations

     –0–    3,785,675    –0–    3,785,675 

Mortgage Pass-Throughs

     –0–    3,765,978    –0–    3,765,978 

Commercial Mortgage-Backed Securities

     –0–    2,093,375    –0–    2,093,375 

Emerging Markets—Corporate Bonds

     –0–    927,177    –0–    927,177 

Collateralized Loan Obligations

     –0–    868,963    –0–    868,963 

Governments—Sovereign Bonds

     –0–    717,277    –0–    717,277 

Emerging Markets—Sovereigns

     –0–    709,046    –0–    709,046 

Covered Bonds

     –0–    546,468    –0–    546,468 

Emerging Markets—Treasuries

     –0–    344,860    –0–    344,860 

Governments—Sovereign Agencies

     –0–    328,163    –0–    328,163 

Asset-Backed Securities

     –0–    101,521    –0–    101,521 

Short-Term Investments:

          

Governments—Treasuries

     –0–    3,682,768    –0–    3,682,768 

Investment Companies

     1,673,235    –0–    –0–    1,673,235 
    

 

 

   

 

 

   

 

 

   

 

 

 

Total Investments in Securities

     154,557,633    89,853,875    197    244,411,705 

Other Financial Instruments(a):

          

Assets:

          

Futures

     17,979    –0–    –0–    17,979(b) 

Forward Currency Exchange Contracts

     –0–    722,602    –0–    722,602 

Centrally Cleared Interest Rate Swaps

     –0–    162,821    –0–    162,821(b) 

Liabilities:

          

Futures

     (6,420   –0–    –0–    (6,420)(b) 

Forward Currency Exchange Contracts

     –0–    (1,302,619   –0–    (1,302,619

Centrally Cleared Interest Rate Swaps

     –0–    (42,719   –0–    (42,719)(b) 

 

38


  AB Variable Products Series Fund

 

     Level 1   Level 2   Level 3   Total 

Credit Default Swaps

    $–0–   $(205,973  $            –0–   $(205,973

Inflation (CPI) Swaps

     –0–    (310,311   –0–    (310,311
    

 

 

   

 

 

   

 

 

   

 

 

 

Total

    $154,569,192   $88,877,676   $197   $243,447,065 
    

 

 

   

 

 

   

 

 

   

 

 

 

 

(a) Other financial instruments are derivative instruments, such as futures, forwards and swaps, which are valued at the unrealized appreciation/(depreciation) on the instrument. Other financial instruments may also include swaps with upfront premiums, options written and swaptions written which are valued at market value.

 

(b) Only variation margin receivable/(payable) at period end is reported within the statement of assets and liabilities. This amount reflects cumulative unrealized appreciation/(depreciation) on futures and centrally cleared swaps as reported in the portfolio of investments. Where applicable, centrally cleared swaps with upfront premiums are presented here at market value.

3. Currency Translation

Assets and liabilities denominated in foreign currencies and commitments under forward currency exchange contracts are translated into U.S. dollars at the mean of the quoted bid and ask prices of such currencies against the U.S. dollar. Purchases and sales of portfolio securities are translated into U.S. dollars at the rates of exchange prevailing when such securities were acquired or sold. Income and expenses are translated into U.S. dollars at rates of exchange prevailing when accrued.

Net realized gain or loss on foreign currency transactions represents foreign exchange gains and losses from sales and maturities of foreign fixed income investments, holding of foreign currencies, currency gains or losses realized between the trade and settlement dates on foreign investment transactions, and the difference between the amounts of dividends, interest and foreign withholding taxes recorded on the Portfolio’s books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized currency gains and losses from valuing foreign currency denominated assets and liabilities at period end exchange rates are reflected as a component of net unrealized appreciation or depreciation of foreign currency denominated assets and liabilities.

4. Taxes

It is the Portfolio’s policy to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its investment company taxable income and net realized gains, if any, to shareholders. Therefore, no provisions for federal income or excise taxes are required. The Portfolio may be subject to taxes imposed by countries in which it invests. Such taxes are generally based on income and/or capital gains earned or repatriated. Taxes are accrued and applied to net investment income, net realized gains and net unrealized appreciation/depreciation as such income and/or gains are earned.

In accordance with U.S. GAAP requirements regarding accounting for uncertainties in income taxes, management has analyzed the Portfolio’s tax positions taken or expected to be taken on federal and state income tax returns for all open tax years (the current and the prior three tax years) and has concluded that no provision for income tax is required in the Portfolio’s financial statements.

5. Investment Income and Investment Transactions

Dividend income is recorded on the ex-dividend date or as soon as the Portfolio is informed of the dividend. Interest income is accrued daily. Investment transactions are accounted for on the date the securities are purchased or sold. Investment gains or losses are determined on the identified cost basis. The Portfolio amortizes premiums and accretes discounts as adjustments to interest income. The Portfolio accounts for distributions received from REIT investments or from regulated investment companies as dividend income, realized gain, or return of capital based on information provided by the REIT or the investment company.

6. Class Allocations

All income earned and expenses incurred by the Portfolio are borne on a pro-rata basis by each outstanding class of shares, based on the proportionate interest in the Portfolio represented by the net assets of such class, except for class specific expenses which are allocated to the respective class. Expenses of the Fund are charged proportionately to each portfolio or based on other appropriate methods. Realized and unrealized gains and losses are allocated among the various share classes based on respective net assets.

7. Dividends and Distributions

Dividends and distributions to shareholders, if any, are recorded on the ex-dividend date. Income dividends and capital gains distributions are determined in accordance with federal tax regulations and may differ from those determined in accordance

 

39


BALANCED WEALTH STRATEGY PORTFOLIO
NOTES TO FINANCIAL STATEMENTS 
(continued) AB Variable Products Series Fund

 

with U.S. GAAP. To the extent these differences are permanent, such amounts are reclassified within the capital accounts based on their federal tax basis treatment; temporary differences do not require such reclassification.

NOTE B: Advisory Fee and Other Transactions with Affiliates

Under the terms of the investment advisory agreement, the Portfolio pays the Adviser an advisory fee at an annual rate of .55% of the first $2.5 billion, .45% of the next $2.5 billion and .40% in excess of $5 billion, of the Portfolio’s average daily net assets. The fee is accrued daily and paid monthly. The Adviser has agreed to waive its fees and bear certain expenses to the extent necessary to limit total operating expenses on an annual basis (the “Expense Caps”) to .75% and 1.00% of daily average net assets for Class A and Class B shares, respectively. For the year ended December 31, 2020, such reimbursements/waivers amounted to $38,509.

Pursuant to the investment advisory agreement, the Portfolio may reimburse the Adviser for certain legal and accounting services provided to the Portfolio by the Adviser. For the year ended December 31, 2020, the reimbursement for such services amounted to $73,979.

The Portfolio compensates AllianceBernstein Investor Services, Inc. (“ABIS”), a wholly-owned subsidiary of the Adviser, under a Transfer Agency Agreement for providing personnel and facilities to perform transfer agency services for the Portfolio. Such compensation retained by ABIS amounted to $1,636 for the year ended December 31, 2020.

The Portfolio may invest in AB Government Money Market Portfolio (the “Government Money Market Portfolio”) which has a contractual annual advisory fee rate of .20% of the Portfolio’s average daily net assets and bears its own expenses. The Adviser has contractually agreed to waive .10% of the advisory fee of Government Money Market Portfolio (resulting in a net advisory fee of ..10%) until August 31, 2021. In connection with the investment by the Portfolio in Government Money Market Portfolio, the Adviser has contractually agreed to waive its advisory fee from the Portfolio in an amount equal to the Portfolio’s pro rata share of the effective advisory fee of Government Money Market Portfolio, as borne indirectly by the Portfolio as an acquired fund fee and expense. For the year ended December 31, 2020, such waiver amounted to $1,471.

In connection with the Portfolio’s investments in other AB mutual funds, the Adviser has contractually agreed to waive fees and/or reimburse the expenses payable to the Adviser by the Portfolio in an amount equal to the Portfolio’s pro rata share of the effective advisory fees of AB mutual funds, as paid by the Portfolio as an acquired fund fee and expense. These fee waivers and/or expense reimbursements will remain in effect until May 1, 2021. For the year ended December 31, 2020, such waivers and/or reimbursements amounted to $465,768.

A summary of the Portfolio’s transactions in AB mutual funds for the year ended December 31, 2020 is as follows:

 

   Distributions 

Fund

 Market Value
12/31/19
(000)
  Purchases
at Cost
(000)
  Sales
Proceeds
(000)
  Realized
Gain (Loss)
(000)
  Change in
Unrealized
Appr./(Depr.)
(000)
  Market Value
12/31/20
(000)
  Dividend
Income
(000)
  Realized
Gains
(000)
 

Government Money Market Portfolio

 $1,821  $49,763  $49,911  $0  $0  $1,673  $5  $0 

AB Discovery Growth Fund, Inc.

  3,307   423   1,631   91   883   3,073   11   412 

AB Trust—AB Discovery Value Fund

  3,319   27   280   (41  126   3,151   28   0 

Bernstein Fund, Inc.:

        

International Small Cap Portfolio

  8,771   97   1,005   (131  678   8,410   97   0 

International Strategic Equities Portfolio

  28,723    15,738    2,592   (76  1,124   42,917   363   0 

Small Cap Core Portfolio

  3,312   17   590   (1  367   3,105   17   0 

Sanford C. Bernstein Fund, Inc.:

        

Emerging Markets Portfolio

  4,116   75   724   7   491   3,965   75   0 

International Portfolio

  16,145   90    16,602    (91  458   0   90   0 

 

40


  AB Variable Products Series Fund

 

   Distributions 

Fund

 Market Value
12/31/19
(000)
  Purchases
at Cost
(000)
  Sales
Proceeds
(000)
  Realized
Gain (Loss)
(000)
  Change in
Unrealized
Appr./(Depr.)
(000)
  Market Value
12/31/20
(000)
�� Dividend
Income
(000)
  Realized
Gains
(000)
 

Government Money Market Portfolio*

 $258  $3,486  $3,744  $0  $0  $0  $0**  $0 
    

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

Total

    $(242 $4,127  $66,294  $686  $412 
    

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

 

 Includes $15,376,822 of purchases / sales resulting from the merger of the International Portfolio into the International Strategic Equities Portfolio, which took place on December 4, 2020.

 

* Investments of cash collateral for securities lending transactions (see Note E).

 

** Amount is less than $500.

Brokerage commissions paid on investment transactions for the year ended December 31, 2020 amounted to $22,183, of which $76 and $0, respectively, was paid to Sanford C. Bernstein & Co. LLC and Sanford C. Bernstein Limited, affiliates of the Adviser.

During the second quarter of 2018, AXA S.A. (“AXA”), a French holding company for the AXA Group, completed the sale of a minority stake in its subsidiary, AXA Equitable Holdings, Inc. (now named Equitable Holdings, Inc.)(“Equitable”), through an initial public offering. Equitable is the holding company for a diverse group of financial services companies, including an approximate 65% economic interest in the Adviser and a 100% interest in AllianceBernstein Corporation, the general partner of the Adviser. Since the initial sale, AXA has completed additional offerings, most recently during the fourth quarter of 2019. As a result, AXA currently owns less than 10% of the outstanding shares of common stock of Equitable, and no longer owns a controlling interest in Equitable. AXA previously announced its intention to sell its entire interest in Equitable over time, subject to market conditions and other factors (the “Plan”). Most of AXA’s remaining Equitable shares are to be delivered on redemption of AXA bonds mandatorily exchangeable into Equitable shares and maturing in May 2021. AXA retains sole discretion to determine the timing of any future sales of its remaining shares of Equitable common stock.

Sales under the Plan that were completed on November 13, 2019 resulted in the indirect transfer of a “controlling block” of voting securities of the Adviser (a “Change of Control Event”) and may have been deemed to have been an “assignment” causing a termination of the Portfolio’s investment advisory and administration agreements. In order to ensure that investment advisory and administration services could continue uninterrupted in the event of a Change of Control Event, the Board previously approved new investment advisory and administration agreements with the Adviser, and shareholders of the Portfolio subsequently approved the new investment advisory agreement. These agreements became effective on November 13, 2019.

NOTE C: Distribution Plan

The Portfolio has adopted a Distribution Plan (the “Plan”) for Class B shares pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the Plan, the Portfolio pays distribution and servicing fees to AllianceBernstein Investments, Inc. (the “Distributor”), a wholly-owned subsidiary of the Adviser, at an annual rate of up to .50% of the Portfolio’s average daily net assets attributable to Class B shares. The fees are accrued daily and paid monthly. The Board currently limits payments under the Plan to .25% of the Portfolio’s average daily net assets attributable to Class B shares. The Plan provides that the Distributor will use such payments in their entirety for distribution assistance and promotional activities.

The Portfolio is not obligated under the Plan to pay any distribution and servicing fees in excess of the amounts set forth above. The purpose of the payments to the Distributor under the Plan is to compensate the Distributor for its distribution services with respect to the sale of the Portfolio’s Class B shares. Since the Distributor’s compensation is not directly tied to its expenses, the amount of compensation received by it under the Plan during any year may be more or less than its actual expenses. For this reason, the Plan is characterized by the staff of the Securities and Exchange Commission as being of the “compensation” variety.

In the event that the Plan is terminated or not continued, no distribution or servicing fees (other than current amounts accrued but not yet paid) would be owed by the Portfolio to the Distributor.

The Plan also provides that the Adviser may use its own resources to finance the distribution of the Portfolio’s shares.

 

41


BALANCED WEALTH STRATEGY PORTFOLIO
NOTES TO FINANCIAL STATEMENTS 
(continued) AB Variable Products Series Fund

 

NOTE D: Investment Transactions

Purchases and sales of investment securities (excluding short-term investments) for the year ended December 31, 2020 were as follows:

 

     Purchases     Sales 

Investment securities (excluding U.S. government securities)

    $125,763,001     $149,997,092 

U.S. government securities

     26,557,041      32,509,745 

The cost of investments for federal income tax purposes, gross unrealized appreciation and unrealized depreciation are as follows:

 

Cost

  $208,114,864 
  

 

 

 

Gross unrealized appreciation

  $41,705,219 

Gross unrealized depreciation

   (5,562,148
  

 

 

 

Net unrealized appreciation

  $36,143,071 
  

 

 

 

1. Derivative Financial Instruments

The Portfolio may use derivatives in an effort to earn income and enhance returns, to replace more traditional direct investments, to obtain exposure to otherwise inaccessible markets (collectively, “investment purposes”), or to hedge or adjust the risk profile of its portfolio.

The principal types of derivatives utilized by the Portfolio, as well as the methods in which they may be used are:

 

  

Futures

The Portfolio may buy or sell futures for investment purposes or for the purpose of hedging its portfolio against adverse effects of potential movements in the market. The Portfolio bears the market risk that arises from changes in the value of these instruments and the imperfect correlation between movements in the price of the futures and movements in the price of the assets, reference rates or indices which they are designed to track. Among other things, the Portfolio may purchase or sell futures for foreign currencies or options thereon for non-hedging purposes as a means of making direct investment in foreign currencies, as described below under “Currency Transactions”.

At the time the Portfolio enters into futures, the Portfolio deposits and maintains as collateral an initial margin with the broker, as required by the exchange on which the transaction is effected. Such amount is shown as cash collateral due from broker on the statement of assets and liabilities. Pursuant to the contract, the Portfolio agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments are known as variation margin and are recorded by the Portfolio as unrealized gains or losses. Risks may arise from the potential inability of a counterparty to meet the terms of the contract. The credit/counterparty risk for exchange-traded futures is generally less than privately negotiated futures, since the clearinghouse, which is the issuer or counterparty to each exchange-traded future, has robust risk mitigation standards, including the requirement to provide initial and variation margin. When the contract is closed, the Portfolio records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the time it was closed.

Use of long futures subjects the Portfolio to risk of loss in excess of the amounts shown on the statement of assets and liabilities, up to the notional value of the futures. Use of short futures subjects the Portfolio to unlimited risk of loss. Under some circumstances, futures exchanges may establish daily limits on the amount that the price of futures can vary from the previous day’s settlement price, which could effectively prevent liquidation of unfavorable positions.

During the year ended December 31, 2020, the Portfolio held futures for hedging and non-hedging purposes.

 

  

Forward Currency Exchange Contracts

The Portfolio may enter into forward currency exchange contracts in order to hedge its exposure to changes in foreign currency exchange rates on its foreign portfolio holdings, to hedge certain firm purchase and sale commitments denominated in foreign currencies and for non-hedging purposes as a means of making direct investments in foreign currencies, as described below under “Currency Transactions”.

 

42


  AB Variable Products Series Fund

 

A forward currency exchange contract is a commitment to purchase or sell a foreign currency at a future date at a negotiated forward rate. The gain or loss arising from the difference between the original contract and the closing of such contract would be included in net realized gain or loss on forward currency exchange contracts. Fluctuations in the value of open forward currency exchange contracts are recorded for financial reporting purposes as unrealized appreciation and/or depreciation by the Portfolio. Risks may arise from the potential inability of a counterparty to meet the terms of a contract and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar.

During the year ended December 31, 2020, the Portfolio held forward currency exchange contracts for hedging and non-hedging purposes.

 

  

Option Transactions

For hedging and investment purposes, the Portfolio may purchase and write (sell) put and call options on U.S. and foreign securities, including government securities, and foreign currencies that are traded on U.S. and foreign securities exchanges and over-the-counter markets. Among other things, the Portfolio may use options transactions for non-hedging purposes as a means of making direct investments in foreign currencies, as described below under “Currency Transactions” and may use options strategies involving the purchase and/or writing of various combinations of call and/or put options, for hedging and investment purposes.

The risk associated with purchasing an option is that the Portfolio pays a premium whether or not the option is exercised. Additionally, the Portfolio bears the risk of loss of the premium and change in market value should the counterparty not perform under the contract. If a put or call option purchased by the Portfolio were permitted to expire without being sold or exercised, its premium would represent a loss to the Portfolio. Put and call options purchased are accounted for in the same manner as portfolio securities. The cost of securities acquired through the exercise of call options is increased by premiums paid. The proceeds from securities sold through the exercise of put options are decreased by the premiums paid.

When the Portfolio writes an option, the premium received by the Portfolio is recorded as a liability and is subsequently adjusted to the current market value of the option written. The Portfolio’s maximum payment for written put options equates to the number of shares multiplied by the strike price. In certain circumstances maximum payout amounts may be partially offset by recovery values of the respective referenced assets and upfront premium received upon entering into the contract. Premiums received from written options which expire unexercised are recorded by the Portfolio on the expiration date as realized gains from options written. The difference between the premium received and the amount paid on effecting a closing purchase transaction, including brokerage commissions, is also treated as a realized gain, or if the premium received is less than the amount paid for the closing purchase transaction, as a realized loss. If a call option is exercised, the premium received is added to the proceeds from the sale of the underlying security or currency in determining whether the Portfolio has realized a gain or loss. If a put option is exercised, the premium received reduces the cost basis of the security or currency purchased by the Portfolio. In writing an option, the Portfolio bears the market risk of an unfavorable change in the price of the security or currency underlying the written option. Exercise of an option written by the Portfolio could result in the Portfolio selling or buying a security or currency at a price different from the current market value.

The Portfolio may also invest in options on swap agreements, also called “swaptions”. A swaption is an option that gives the buyer the right, but not the obligation, to enter into a swap on a future date in exchange for paying a market-based “premium”. A receiver swaption gives the owner the right to receive the total return of a specified asset, reference rate, or index. A payer swaption gives the owner the right to pay the total return on a specified asset, reference rate, or index. Swaptions also include options that allow an existing swap to be terminated or extended by one of the counterparties. The Portfolio’s maximum payment for written put swaptions equates to the notional amount of the underlying swap. In certain circumstances maximum payout amounts may be partially offset by recovery values of the respective referenced assets and upfront premium received upon entering into the contract.

During the year ended December 31, 2020, the Portfolio held written swaptions for hedging and non-hedging purposes.

 

43


BALANCED WEALTH STRATEGY PORTFOLIO
NOTES TO FINANCIAL STATEMENTS 
(continued) AB Variable Products Series Fund

 

  

Swaps

The Portfolio may enter into swaps to hedge its exposure to interest rates, credit risk or currencies. The Portfolio may also enter into swaps for non-hedging purposes as a means of gaining market exposures, making direct investments in foreign currencies, as described below under “Currency Transactions.” A swap is an agreement that obligates two parties to exchange a series of cash flows at specified intervals based upon or calculated by reference to changes in specified prices or rates for a specified amount of an underlying asset. The payment flows are usually netted against each other, with the difference being paid by one party to the other. In addition, collateral may be pledged or received by the Portfolio in accordance with the terms of the respective swaps to provide value and recourse to the Portfolio or its counterparties in the event of default, bankruptcy or insolvency by one of the parties to the swap.

Risks may arise as a result of the failure of the counterparty to the swap to comply with the terms of the swap. The loss incurred by the failure of a counterparty is generally limited to the net interim payment to be received by the Portfolio, and/or the termination value at the end of the contract. Therefore, the Portfolio considers the creditworthiness of each counterparty to a swap in evaluating potential counterparty risk. This risk is mitigated by having a netting arrangement between the Portfolio and the counterparty and by the posting of collateral by the counterparty to the Portfolio to cover the Portfolio’s exposure to the counterparty. Additionally, risks may arise from unanticipated movements in interest rates or in the value of the underlying securities. The Portfolio accrues for the interim payments on swaps on a daily basis, with the net amount recorded within unrealized appreciation/depreciation of swaps on the statement of assets and liabilities, where applicable. Once the interim payments are settled in cash, the net amount is recorded as realized gain/(loss) on swaps on the statement of operations, in addition to any realized gain/(loss) recorded upon the termination of swaps. Upfront premiums paid or received for OTC swaps are recognized as cost or proceeds on the statement of assets and liabilities and are amortized on a straight line basis over the life of the contract. Amortized upfront premiums are included in net realized gain/(loss) from swaps on the statement of operations. Fluctuations in the value of swaps are recorded as a component of net change in unrealized appreciation/depreciation of swaps on the statement of operations.

Certain standardized swaps, including certain interest rate swaps and credit default swaps, are (or soon will be) subject to mandatory central clearing. Cleared swaps are transacted through futures commission merchants (“FCMs”) that are members of central clearinghouses, with the clearinghouse serving as central counterparty, similar to transactions in futures contracts. Centralized clearing will be required for additional categories of swaps on a phased-in basis based on requirements published by the Securities and Exchange Commission and Commodity Futures Trading Commission.

At the time the Portfolio enters into a centrally cleared swap, the Portfolio deposits and maintains as collateral an initial margin with the broker, as required by the clearinghouse on which the transaction is effected. Such amount is shown as cash collateral due from broker on the statement of assets and liabilities. Pursuant to the contract, the Portfolio agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments are known as variation margin and are recorded by the Portfolio as unrealized gains or losses. Risks may arise from the potential inability of a counterparty to meet the terms of the contract. The credit/counterparty risk for centrally cleared swaps is generally less than non-centrally cleared swaps, since the clearinghouse, which is the issuer or counterparty to each centrally cleared swap, has robust risk mitigation standards, including the requirement to provide initial and variation margin. When the contract is closed, the Portfolio records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the time it was closed.

Interest Rate Swaps:

The Portfolio is subject to interest rate risk exposure in the normal course of pursuing its investment objectives. Because the Portfolio holds fixed rate bonds, the value of these bonds may decrease if interest rates rise. To help hedge against this risk and to maintain its ability to generate income at prevailing market rates, the Portfolio may enter into interest rate swaps. Interest rate swaps are agreements between two parties to exchange cash flows based on a notional amount. The Portfolio may elect to pay a fixed rate and receive a floating rate, or, receive a fixed rate and pay a floating rate on a notional amount.

 

44


  AB Variable Products Series Fund

 

In addition, the Portfolio may also enter into interest rate swap transactions to preserve a return or spread on a particular investment or portion of its portfolio, or protecting against an increase in the price of securities the Portfolio anticipates purchasing at a later date. Interest rate swaps involve the exchange by a Portfolio with another party of their respective commitments to pay or receive interest (e.g., an exchange of floating rate payments for fixed rate payments) computed based on a contractually-based principal (or “notional”) amount. Interest rate swaps are entered into on a net basis (i.e., the two payment streams are netted out, with the Portfolio receiving or paying, as the case may be, only the net amount of the two payments).

During the year ended December 31, 2020, the Portfolio held interest rate swaps for hedging and non-hedging purposes.

Inflation (CPI) Swaps:

Inflation swap agreements are contracts in which one party agrees to pay the cumulative percentage increase in a price index (the Consumer Price Index with respect to CPI swaps) over the term of the swap (with some lag on the inflation index), and the other pays a compounded fixed rate. Inflation swaps may be used to protect the net asset value, or NAV, of a Portfolio against an unexpected change in the rate of inflation measured by an inflation index since the value of these agreements is expected to increase if there are unexpected inflation increases.

During the year ended December 31, 2020, the Portfolio held inflation (CPI) swaps for hedging and non-hedging purposes.

Credit Default Swaps:

The Portfolio may enter into credit default swaps, including to manage its exposure to the market or certain sectors of the market, to reduce its risk exposure to defaults by corporate and sovereign issuers held by the Portfolio, or to create exposure to corporate or sovereign issuers to which it is not otherwise exposed. The Portfolio may purchase credit protection (“Buy Contract”) or provide credit protection (“Sale Contract”) on the referenced obligation of the credit default swap. During the term of the swap, the Portfolio receives/(pays) fixed payments from/(to) the respective counterparty, calculated at the agreed upon rate applied to the notional amount. If the Portfolio is a buyer/(seller) of protection and a credit event occurs, as defined under the terms of the swap, the Portfolio will either (i) receive from the seller/(pay to the buyer) of protection an amount equal to the notional amount of the swap (the “Maximum Payout Amount”) and deliver/(take delivery of) the referenced obligation or (ii) receive/(pay) a net settlement amount in the form of cash or securities equal to the notional amount of the swap less the recovery value of the referenced obligation. In certain circumstances Maximum Payout Amounts may be partially offset by recovery values of the respective referenced obligations, upfront premium received upon entering into the agreement, or net amounts received from settlement of buy protection credit default swaps entered into by the Portfolio for the same referenced obligations with the same counterparty.

Credit default swaps may involve greater risks than if a Portfolio had invested in the referenced obligation directly. Credit default swaps are subject to general market risk, liquidity risk, counterparty risk and credit risk. If the Portfolio is a buyer of protection and no credit event occurs, it will lose the payments it made to its counterparty. If the Portfolio is a seller of protection and a credit event occurs, the value of the referenced obligation received by the Portfolio coupled with the periodic payments previously received, may be less than the Maximum Payout Amount it pays to the buyer, resulting in a net loss to the Portfolio.

Implied credit spreads over U.S. Treasuries of comparable maturity utilized in determining the market value of credit default swaps on issuers as of period end are disclosed in the portfolio of investments. The implied spreads serve as an indicator of the current status of the payment/performance risk and typically reflect the likelihood of default by the issuer of the referenced obligation. The implied credit spread of a particular reference obligation also reflects the cost of buying/selling protection and may reflect upfront payments required to be made to enter into the agreement. Widening credit spreads typically represent a deterioration of the referenced obligation’s credit soundness and greater likelihood of default or other credit event occurring as defined under the terms of the agreement. A credit spread identified as “Defaulted” indicates a credit event has occurred for the referenced obligation.

During the year ended December 31, 2020, the Portfolio held credit default swaps for hedging and non-hedging purposes.

 

45


BALANCED WEALTH STRATEGY PORTFOLIO
NOTES TO FINANCIAL STATEMENTS 
(continued) AB Variable Products Series Fund

 

The Portfolio typically enters into International Swaps and Derivatives Association, Inc. Master Agreements (“ISDA Master Agreement”) with its OTC derivative contract counterparties in order to, among other things, reduce its credit risk to OTC counterparties. ISDA Master Agreements include provisions for general obligations, representations, collateral and events of default or termination. Under an ISDA Master Agreement, the Portfolio typically may offset with the OTC counterparty certain derivative financial instruments’ payables and/or receivables with collateral held and/or posted and create one single net payment (close-out netting) in the event of default or termination. In the event of a default by an OTC counterparty, the return of collateral with market value in excess of the Portfolio’s net liability, held by the defaulting party, may be delayed or denied.

The Portfolio’s ISDA Master Agreements may contain provisions for early termination of OTC derivative transactions in the event the net assets of the Portfolio decline below specific levels (“net asset contingent features”). If these levels are triggered, the Portfolio’s OTC counterparty has the right to terminate such transaction and require the Portfolio to pay or receive a settlement amount in connection with the terminated transaction. If OTC derivatives were held at period end, please refer to netting arrangements by the OTC counterparty table below for additional details.

During the year ended December 31, 2020, the Portfolio had entered into the following derivatives:

 

  

Asset Derivatives

  

Liability Derivatives

 

Derivative Type

 

Statement of
Assets and Liabilities
Location

  Fair Value  

Statement of
Assets and Liabilities
Location

 Fair Value 

Interest rate contracts

 Receivable/Payable for variation margin on futures  $17,979 Receivable/Payable for variation margin on futures $6,420

Interest rate contracts

 Receivable/Payable for variation margin on centrally cleared swaps   162,819 Receivable/Payable for variation margin on centrally cleared swaps  49,316

Foreign currency contracts

 Unrealized appreciation on forward currency exchange contracts   722,602  Unrealized depreciation on forward currency exchange contracts  1,302,619 

Interest rate contracts

    Unrealized depreciation on inflation swaps  310,311 

Credit contracts

    Market value on credit default swaps  205,973 
   

 

 

   

 

 

 

Total

   $903,400   $1,874,639 
   

 

 

   

 

 

 

 

* Only variation margin receivable/payable at period end is reported within the statement of assets and liabilities. This amount reflects cumulative unrealized appreciation/(depreciation) on futures and centrally cleared swaps as reported in the portfolio of investments.

 

Derivative Type

  

Location of Gain or (Loss) on Derivatives
Within Statement of Operations

  Realized Gain or
(Loss) on
Derivatives
  Change in Unrealized
Appreciation or
(Depreciation)
 

Interest rate contracts

  Net realized gain (loss) on futures; Net change in unrealized appreciation/depreciation of futures  $1,261,034  $173,913 

Foreign currency contracts

  Net realized gain (loss) on forward currency exchange contracts; Net change in unrealized appreciation/depreciation of forward currency exchange contracts   (846,012  157,549 

Interest rate contracts

  Net realized gain (loss) on swaptions written; Net change in unrealized appreciation/depreciation of swaptions written   70,092   –0– 

Interest rate contracts

  Net realized gain (loss) on swaps; Net change in unrealized appreciation/depreciation of swaps   (1,188,146  548,337 

 

46


  AB Variable Products Series Fund

 

Derivative Type

  

Location of Gain or (Loss) on Derivatives
Within Statement of Operations

  Realized Gain or
(Loss) on
Derivatives
  Change in Unrealized
Appreciation or
(Depreciation)
 

Credit contracts

  Net realized gain (loss) on swaps; Net change in unrealized appreciation/depreciation of swaps  $(141,145 $(149,565
    

 

 

  

 

 

 

Total

    $(844,177 $730,234 
      

 

 

  

 

 

 

The following table represents the average monthly volume of the Portfolio’s derivative transactions during the year ended December 31, 2020:

 

Futures:

  

Average notional amount of buy contracts

  $14,330,974 

Average notional amount of sale contracts

  $7,650,431 

Forward Currency Exchange Contracts:

  

Average principal amount of buy contracts

  $23,792,772 

Average principal amount of sale contracts

  $63,768,993 

Swaptions Written:

  

Average notional amount

  $2,687,583(a) 

Inflation Swaps:

  

Average notional amount

  $10,000,000 

Centrally Cleared Interest Rate Swaps:

  

Average notional amount

  $8,793,878 

Credit Default Swaps:

  

Average notional amount of sale contracts

  $1,356,769 

Centrally Cleared Credit Default Swaps:

  

Average notional amount of buy contracts

  $1,731,510(b) 

 

(a) Positions were open for six months during the year.

 

(b) Positions were open for less than one month during the year.

For financial reporting purposes, the Portfolio does not offset derivative assets and derivative liabilities that are subject to netting arrangements in the statement of assets and liabilities.

All OTC derivatives held at period end were subject to netting arrangements. The following table presents the Portfolio’s derivative assets and liabilities by OTC counterparty net of amounts available for offset under ISDA Master Agreements (“MA”) and net of the related collateral received/pledged by the Portfolio as of December 31, 2020. Exchange-traded derivatives and centrally cleared swaps are not subject to netting arrangements and as such are excluded from the table.

 

Counterparty

  Derivative Assets
Subject to a MA
   Derivatives
Available for
Offset
  Cash Collateral
Received*
  Security Collateral
Received*
  Net Amount of
Derivative Assets
 

Bank of America, NA

  $1,386   $(1,386 $            –0–  $            –0–  $–0– 

Barclays Bank PLC

   17,449    –0–   –0–   –0–   17,449 

BNP Paribas SA

   65,643    (65,643  –0–   –0–   –0– 

Citibank, NA/Citigroup Global Markets, Inc

   129,032    (129,032  –0–   –0–   –0– 

Credit Suisse International

   26,879    (24,591  –0–   –0–   2,288 

Goldman Sachs Bank USA

   73,442    (73,442  –0–   –0–   –0– 

JPMorgan Chase Bank, NA

   89,789    (89,789  –0–   –0–   –0– 

Morgan Stanley & Co., Inc.

   134,456    (134,456  –0–   –0–   –0– 

Natwest Markets PLC

   14,972    (588  –0–   –0–   14,384 

Standard Chartered Bank

   71,094    (5,987  –0–   –0–   65,107 

State Street Bank & Trust Co.

   98,460    (98,460  –0–   –0–   –0– 
  

 

 

   

 

 

  

 

 

  

 

 

  

 

 

 

Total

  $722,602   $(623,374 $–0–  $–0–  $99,228
  

 

 

   

 

 

  

 

 

  

 

 

  

 

 

 

 

47


BALANCED WEALTH STRATEGY PORTFOLIO
NOTES TO FINANCIAL STATEMENTS 
(continued) AB Variable Products Series Fund

 

Counterparty

  Derivative Liabilities
Subject to a MA
   Derivatives
Available for
Offset
  Cash Collateral
Pledged*
  Security Collateral
Pledged*
  Net Amount of
Derivative Liabilities
 

Bank of America, NA

  $310,311   $(1,386 $(308,925 $            –0–  $–0– 

BNP Paribas SA

   87,622    (65,643  –0–   –0–   21,979 

Citibank, NA/Citigroup Global Markets, Inc

   352,461    (129,032  –0–   –0–   223,429 

Credit Suisse International

   24,591    (24,591  –0–   –0–   –0– 

Deutsche Bank AG

   32,512    –0–   –0–   –0–   32,512 

Goldman Sachs Bank USA/Goldman Sachs International

   173,763    (73,442  –0–   –0–   100,321 

JPMorgan Chase Bank, NA

   94,643    (89,789  –0–   –0–   4,854 

Morgan Stanley & Co., Inc.

   287,078    (134,456  –0–   –0–   152,622 

Natwest Markets PLC

   588    (588  –0–   –0–   –0– 

Standard Chartered Bank

   5,987    (5,987  –0–   –0–   –0– 

State Street Bank & Trust Co.

   348,283    (98,460  –0–   –0–   249,823 

UBS AG

   101,064    –0–   –0–   –0–   101,064 
  

 

 

   

 

 

  

 

 

  

 

 

  

 

 

 

Total

  $1,818,903   $(623,374 $(308,925 $–0–  $886,604
  

 

 

   

 

 

  

 

 

  

 

 

  

 

 

 

 

* The actual collateral received/pledged may be more than the amount reported due to over-collateralization.

 

^ Net amount represents the net receivable/payable that would be due from/to the counterparty in the event of default or termination. The net amount from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same counterparty.

2. Currency Transactions

The Portfolio may invest in non-U.S. Dollar-denominated securities on a currency hedged or unhedged basis. The Portfolio may seek investment opportunities by taking long or short positions in currencies through the use of currency-related derivatives, including forward currency exchange contracts, futures and options on futures, swaps, and other options. The Portfolio may enter into transactions for investment opportunities when it anticipates that a foreign currency will appreciate or depreciate in value but securities denominated in that currency are not held by the Portfolio and do not present attractive investment opportunities. Such transactions may also be used when the Adviser believes that it may be more efficient than a direct investment in a foreign currency-denominated security. The Portfolio may also conduct currency exchange contracts on a spot basis (i.e., for cash at the spot rate prevailing in the currency exchange market for buying or selling currencies).

3. TBA and Dollar Rolls

The Portfolio may invest in TBA mortgage-backed securities. A TBA, or “To Be Announced”, trade represents a contract for the purchase or sale of mortgage-backed securities to be delivered at a future agree-upon date; however, the specific mortgage pool numbers or the number of pools that will be delivered to fulfill the trade obligation or terms of the contract are unknown at the time of the trade. Mortgage pools (including fixed-rate or variable-rate mortgages) guaranteed by the Government National Mortgage Association, or GNMA, the Federal National Mortgage Association, or FNMA, or the Federal Home Loan Mortgage Corporation, or FHLMC, are subsequently allocated to the TBA transactions.

The Portfolio may enter into certain TBA transactions known as dollar rolls. Dollar rolls involve sales by the Portfolio of securities for delivery in the current month and the Portfolio’s simultaneously contracting to repurchase substantially similar (same type and coupon) securities on a specified future date. During the roll period, the Portfolio forgoes principal and interest paid on the securities. The Portfolio is compensated by the difference between the current sales price and the lower forward price for the future purchase (often referred to as the “drop”) as well as by the interest earned on the cash proceeds of the initial sale. Dollar rolls involve the risk that the market value of the securities the Portfolio is obligated to repurchase under the agreement may decline below the repurchase price. Dollar rolls are speculative techniques. For the year ended December 31, 2020, the Portfolio earned drop income of $3,298 which is included in interest income in the accompanying statement of operations.

NOTE E: Securities Lending

The Portfolio may enter into securities lending transactions. Under the Portfolio’s securities lending program, all loans of securities will be collateralized continually by cash collateral and/or non-cash collateral. Non-cash collateral will include only securities

 

48


  AB Variable Products Series Fund

 

issued or guaranteed by the U.S. government or its agencies or instrumentalities. The Portfolio cannot sell or repledge any non-cash collateral, such collateral will not be reflected in the portfolio of investments. If a loan is collateralized by cash, the Portfolio will be compensated for the loan from a portion of the net return from the income earned on cash collateral after a rebate is paid to the borrower (in some cases, this rebate may be a “negative rebate” or fee paid by the borrower to the Portfolio in connection with the loan), and payments are made for fees of the securities lending agent and for certain other administrative expenses. If the Portfolio receives non-cash collateral, the Portfolio will receive a fee from the borrower generally equal to a negotiated percentage of the market value of the loaned securities. The Portfolio will have the right to call a loan and obtain the securities loaned at any time on notice to the borrower within the normal and customary settlement time for the securities. While the securities are on loan, the borrower is obligated to pay the Portfolio amounts equal to any income or other distributions from the securities; however, these distributions will not be afforded the same preferential tax treatment as qualified dividends. The Portfolio will not be able to exercise voting rights with respect to any securities during the existence of a loan, but will have the right to regain ownership of loaned securities in order to exercise voting or other ownership rights. Collateral received and securities loaned are marked to market daily to ensure that the securities loaned are secured by collateral. The lending agent currently invests the cash collateral received in Government Money Market Portfolio, an eligible money market vehicle, in accordance with the investment restrictions of the Portfolio, and as approved by the Board. The collateral received on securities loaned is recorded as an asset as well as a corresponding liability in the statement of assets and liabilities. The collateral will be adjusted the next business day to maintain the required collateral amount. The amounts of securities lending income from the borrowers and Government Money Market Portfolio are reflected in the statement of operations. When the Portfolio earns net securities lending income from Government Money Market Portfolio, the income is inclusive of a rebate expense paid to the borrower. In connection with the cash collateral investment by the Portfolio in Government Money Market Portfolio, the Adviser has agreed to waive a portion of the Portfolio’s share of the advisory fees of Government Money Market Portfolio, as borne indirectly by the Portfolio as an acquired fund fee and expense. When the Portfolio lends securities, its investment performance will continue to reflect changes in the value of the securities loaned. A principal risk of lending portfolio securities is that the borrower may fail to return the loaned securities upon termination of the loan and that the collateral will not be sufficient to replace the loaned securities. The lending agent has agreed to indemnify the Portfolio in the case of default of any securities borrower.

A summary of the Portfolio’s transactions surrounding securities lending for the year ended December 31, 2020 is as follows:

 

Market Value of
Securities

on Loan*

  

Cash Collateral*

  

Market Value of
Non-Cash
Collateral*

  

Income from
Borrowers

  Government Money Market
Portfolio
 
 Income
Earned
  Advisory Fee
Waived
 
$646,459  $            –0–  $655,064  $2,055  $243  $36 

 

* As of December 31, 2020.

NOTE F: Capital Stock

Each class consists of 500,000,000 authorized shares. Transactions in capital shares for each class were as follows:

 

  SHARES     AMOUNT 
  Year Ended
December 31,
2020
  Year Ended
December 31,
2019
     Year Ended
December 31,
2020
  Year Ended
December 31,
2019
 

Class A

     

Shares sold

  77,220   78,265   $757,635  $848,106 

Shares issued in reinvestment of dividends and distributions

  114,782   367,208    1,115,680   3,532,547 

Shares redeemed

  (567,977  (441,090   (5,567,327  (4,638,019
 

 

 

  

 

 

   

 

 

  

 

 

 

Net increase (decrease)

  (375,975  4,383   $(3,694,012 $(257,366
 

 

 

  

 

 

   

 

 

  

 

 

 

Class B

     

Shares sold

  1,282,047   1,141,276   $11,968,828  $12,135,176 

Shares issued in reinvestment of dividends

  1,140,680   3,456,725    10,939,126   32,838,881 

Shares redeemed

  (4,048,921  (3,799,936   (38,315,162  (39,633,910
 

 

 

  

 

 

   

 

 

  

 

 

 

Net increase (decrease)

  (1,626,194  798,065   $(15,407,208 $5,340,147 
 

 

 

  

 

 

   

 

 

  

 

 

 

 

49


BALANCED WEALTH STRATEGY PORTFOLIO
NOTES TO FINANCIAL STATEMENTS 
(continued) AB Variable Products Series Fund

 

At December 31, 2020, certain shareholders of the Portfolio owned 67% in aggregate of the Portfolio’s outstanding shares. Significant transactions by such shareholders, if any, may impact the Portfolio’s performance.

NOTE G: Risks Involved in Investing in the Portfolio

Market Risk—The value of the Portfolio’s assets will fluctuate as the stock or bond market fluctuates. The value of its investments may decline, sometimes rapidly and unpredictably, simply because of economic changes or other events, including public health crises (including the occurrence of a contagious disease or illness), that affect large portions of the market.

Allocation Risk—The allocation of investments among the different investment styles, such as growth or value, equity or debt securities, or U.S. or non-U.S. securities may have a more significant effect on the Portfolio’s net asset value, or NAV, when one of these investment strategies is performing more poorly than others.

Foreign (Non-U.S.) Risk—Investments in securities of non-U.S. issuers may involve more risk than those of U.S. issuers. These securities may fluctuate more widely in price and may be more difficult to trade due to adverse market, economic, political, regulatory or other factors.

Emerging Market Risk—Investments in emerging market countries may have more risk because the markets are less developed and less liquid, and because these investments may be subject to increased economic, political, regulatory or other uncertainties.

Currency Risk—Fluctuations in currency exchange rates may negatively affect the value of the Portfolio’s investments or reduce the Portfolio’s returns.

Interest Rate Risk—Changes in interest rates will affect the value of investments in fixed-income securities. When interest rates rise, the value of existing investments in fixed-income securities tends to fall and this decrease in value may not be offset by higher income from new investments. Interest rate risk is generally greater for fixed-income securities with longer maturities or durations.

Credit Risk—An issuer or guarantor of a fixed-income security, or the counterparty to a derivatives or other contract, may be unable or unwilling to make timely payments of interest or principal, or to otherwise honor its obligations. The issuer or guarantor may default, causing a loss of the full principal amount of a security and accrued interest. The degree of risk for a particular security may be reflected in its credit rating. There is the possibility that the credit rating of a fixed-income security may be downgraded after purchase, which may adversely affect the value of the security.

Below Investment Grade Securities Risk—Investments in fixed-income securities with lower ratings (“junk bonds”) tend to have a higher probability that an issuer will default or fail to meet its payment obligations. These securities may be subject to greater price volatility due to such factors as specific corporate developments, interest rate sensitivity and negative perceptions of the junk bond market generally, and may be more difficult to trade or dispose of than other types of securities.

Capitalization Risk—Investments in small- and mid-capitalization companies may be more volatile than investments in large-capitalization companies. Investments in small- and mid-capitalization companies may have additional risks because these companies have limited product lines, markets or financial resources.

Investment in Other Investment Companies Risk—As with other investments, investments in other investment companies are subject to market and selection risk. In addition, Contractholders invested in the Portfolio bear both their proportionate share of expenses in the Portfolio (including management fees) and, indirectly, the expenses of the investment companies in which the Portfolio invests (to the extent these expenses are not waived or reimbursed by the Adviser).

Derivatives Risk—The Portfolio may enter into derivative transactions such as forwards, options, futures and swaps. Derivatives may be illiquid, difficult to price, and leveraged so that small changes may produce disproportionate losses for the Portfolio, and subject to counterparty risk to a greater degree than more traditional investments. Derivatives may result in significant losses, including losses that are far greater than the value of the derivatives reflected on the statement of assets and liabilities.

Real Asset Risk—The Portfolio’s investments in securities linked to real assets involve significant risks, including financial, operating, and competitive risks. Investments in securities linked to real assets expose the Portfolio to adverse macroeconomic conditions, such as a rise in interest rates or a downturn in the economy in which the asset is located. Changes in

 

50


  AB Variable Products Series Fund

 

inflation rates or in the market’s inflation expectations may adversely affect the market value of inflation-sensitive equities. The Portfolio’s investments in real estate securities have many of the same risks as direct ownership of real estate, including the risk that the value of real estate could decline due to a variety of factors that affect the real estate market generally. Investments in real estate investment trusts (“REITs”) may have additional risks. REITs are dependent on the capability of their managers, may have limited diversification, and could be significantly affected by changes in tax laws.

Active Trading Risk—The Portfolio expects to engage in active and frequent trading of its portfolio securities and its portfolio turnover rate is expected to exceed 100%. A higher rate of portfolio turnover increases transaction costs, which may negatively affect the Portfolio’s return.

LIBOR Transition and Associated Risk—A Portfolio may invest in debt securities, derivatives or other financial instruments that utilize the London Interbank Offered Rate, or “LIBOR,” as a “benchmark” or “reference rate” for various interest rate calculations. In July 2017, the United Kingdom Financial Conduct Authority, which regulates LIBOR, announced a desire to phase out the use of LIBOR by the end of 2021. Although widely used LIBOR rates are intended to be published until June 2023, banks are strongly encouraged to cease entering into agreements with counterparties referencing LIBOR by the end of 2021. Although financial regulators and industry working groups have suggested alternative reference rates, such as the European Interbank Offer Rate, the Sterling Overnight Interbank Average Rate and the Secured Overnight Financing Rate, global consensus on alternative rates is lacking and the process for amending existing contracts or instruments to transition away from LIBOR is underway but remains incomplete. The elimination of LIBOR or changes to other reference rates or any other changes or reforms to the determination or supervision of reference rates could have an adverse impact on the market for, or value of, any securities or payments linked to those reference rates, which may adversely affect a Portfolio’s performance and/or net asset value. Uncertainty and risk also remain regarding the willingness and ability of issuers and lenders to include revised provisions in new and existing contracts or instruments. Consequently, the transition away from LIBOR to other reference rates may lead to increased volatility and illiquidity in markets that are tied to LIBOR, fluctuations in values of LIBOR-related investments or investments in issuers that utilize LIBOR, increased difficulty in borrowing or refinancing and diminished effectiveness of hedging strategies, potentially adversely affecting a Portfolio’s performance. Furthermore, the risks associated with the expected discontinuation of LIBOR and transition may be exacerbated if the work necessary to effect an orderly transition to an alternative reference rate is not completed in a timely manner. Because the usefulness of LIBOR as a benchmark could deteriorate during the transition period, these effects could occur prior to the end of 2021.

Indemnification Risk—In the ordinary course of business, the Portfolio enters into contracts that contain a variety of indemnifications. The Portfolio’s maximum exposure under these arrangements is unknown. However, the Portfolio has not had prior claims or losses pursuant to these indemnification provisions and expects the risk of loss thereunder to be remote. Therefore, the Portfolio has not accrued any liability in connection with these indemnification provisions.

Management Risk—The Portfolio is subject to management risk because it is an actively-managed investment fund. The Adviser will apply its investment techniques and risk analyses in making investment decisions for the Portfolio, but there is no guarantee that its techniques will produce the intended results. Some of these techniques may incorporate, or rely upon, quantitative models, but there is no guarantee that these models will generate accurate forecasts, reduce risk or otherwise perform as expected.

NOTE H: Joint Credit Facility

A number of open-end mutual funds managed by the Adviser, including the Portfolio, participate in a $325 million revolving credit facility (the “Facility”) intended to provide short-term financing, if necessary, subject to certain restrictions in connection with abnormal redemption activity. Commitment fees related to the Facility are paid by the participating funds and are included in miscellaneous expenses in the statement of operations. The Portfolio did not utilize the Facility during the year ended December 31, 2020.

 

51


BALANCED WEALTH STRATEGY PORTFOLIO
NOTES TO FINANCIAL STATEMENTS 
(continued) AB Variable Products Series Fund

 

NOTE I: Distributions to Shareholders

The tax character of distributions paid during the fiscal years ended December 31, 2020 and December 31, 2019 were as follows:

 

     2020     2019 

Distributions paid from:

        

Ordinary income

    $5,219,650     $5,933,950 

Net long-term capital gains

     6,835,156      30,437,478 
    

 

 

     

 

 

 

Total taxable distributions paid

    $12,054,806     $36,371,428 
    

 

 

     

 

 

 

As of December 31, 2020, the components of accumulated earnings/(deficit) on a tax basis were as follows:

 

Undistributed ordinary income

  $2,491,465 

Undistributed capital gains

   3,784,545 

Other losses

   (40,119)(a) 

Unrealized appreciation/(depreciation)

   36,131,875(b) 
  

 

 

 

Total accumulated earnings/(deficit)

  $42,367,766(c) 
  

 

 

 

 

(a) As of December 31, 2020, the cumulative deferred loss on straddles was $40,119

 

(b) The differences between book-basis and tax-basis unrealized appreciation/(depreciation) are attributable primarily to the recognition for tax purposes of unrealized gains/losses on certain derivative instruments, the tax treatment of passive foreign investment companies (PFICs), the tax treatment of Treasury inflation-protected securities, the amortization on callable bonds, the tax treatment of swaps, and the tax deferral of losses on wash sales.

 

(c) The differences between book-basis and tax-basis components of accumulated earnings/(deficit) is attributable primarily to accrual of foreign capital gains tax.

For tax purposes, net realized capital losses may be carried over to offset future capital gains, if any. Funds are permitted to carry forward capital losses for an indefinite period, and such losses will retain their character as either short-term or long-term capital losses. As of December 31, 2020, the Portfolio did not have any capital loss carryforwards.

During the current fiscal year, there were no permanent differences that resulted in adjustments to distributable earnings or additional paid-in capital.

NOTE J: Subsequent Events

Management has evaluated subsequent events for possible recognition or disclosure in the financial statements through the date the financial statements are issued. Management has determined that there are no material events that would require disclosure in the Portfolio’s financial statements through this date.

 

52


 
BALANCED WEALTH STRATEGY PORTFOLIO
FINANCIAL HIGHLIGHTS AB Variable Products Series Fund

 

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

 

  CLASS A 
  Year Ended December 31, 
  2020  2019  2018  2017  2016 

Net asset value, beginning of period

  $10.24   $10.10   $11.86   $10.54   $10.99 
 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
     

Income From Investment Operations

     

Net investment income (a)(b)

  .13   .19   .23   .17   .19† 

Net realized and unrealized gain (loss) on investment and foreign currency transactions

  .78   1.58   (.87  1.48   .34 

Contributions from Affiliates

  –0–   –0–   .00(c)   .00(c)   .00(c) 
 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

Net increase (decrease) in net asset value from operations

  .91   1.77   (.64  1.65   .53 
 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
     

Less: Dividends and Distributions

     

Dividends from net investment income

  (.24  (.29  (.23  (.24  (.24

Distributions from net realized gain on investment transactions

  (.30  (1.34  (.89  (.09  (.74
 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

Total dividends and distributions

  (.54  (1.63  (1.12  (.33  (.98
 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

Net asset value, end of period

  $10.61   $10.24   $10.10   $11.86   $10.54 
 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
     

Total Return

     

Total investment return based on net asset value (d)*

  9.41  18.53  (6.17)%   15.84  4.69%† 
     

Ratios/Supplemental Data

     

Net assets, end of period (000’s omitted)

  $21,252   $24,347   $23,967   $29,328   $30,132 

Ratio to average net assets of:

     

Expenses, net of waivers/reimbursements (e)(f)‡

  .55  .55  .66  .73  .73

Expenses, before waivers/reimbursements (e)(f)‡

  .77  .75  .75  .73  .73

Net investment income (b)

  1.38  1.81  2.05  1.51  1.74%† 

Portfolio turnover rate**

  66  63  150  108  106
     

‡ Expense ratios exclude the estimated acquired fund fees of the affiliated/unaffiliated underlying

  

portfolios

  .22  .22  .11  .00  .00

 

 

See footnote summary on page 55.

 

53


BALANCED WEALTH STRATEGY PORTFOLIO
FINANCIAL HIGHLIGHTS 
(continued) AB Variable Products Series Fund

 

Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period

 

  CLASS B 
  Year Ended December 31, 
  2020  2019  2018  2017  2016 

Net asset value, beginning of period

  $10.10   $9.98   $11.73   $10.42   $10.87 
 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
     

Income From Investment Operations

     

Net investment income (a)(b)

  .11   .16   .20   .14   .16† 

Net realized and unrealized gain (loss) on investment and foreign currency transactions

  .78   1.56   (.86  1.47   .33 

Contributions from Affiliates

  –0–   –0–   .00(c)   .00(c)   .00(c) 
 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

Net increase (decrease) in net asset value from operations

  .89   1.72   (.66  1.61   .49 
 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
     

Less: Dividends and Distributions

     

Dividends from net investment income

  (.22  (.26  (.20  (.21  (.20

Distributions from net realized gain on investment transactions

  (.30  (1.34  (.89  (.09  (.74
 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

Total dividends and distributions

  (.52  (1.60  (1.09  (.30  (.94
 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

Net asset value, end of period

  $10.47   $10.10   $9.98   $11.73   $10.42 
 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
     

Total Return

     

Total investment return based on net asset value (d)*

  9.25  18.20  (6.41)%   15.62  4.44%† 
     

Ratios/Supplemental Data

     

Net assets, end of period (000’s omitted)

  $222,427   $231,071   $220,274   $274,070   $272,733 

Ratio to average net assets of:

     

Expenses, net of waivers/reimbursements (e)(f)‡

  .80  .80  .91  .98  .98

Expenses, before waivers/reimbursements (e)(f)‡

  1.02  1.00  1.00  .98  .98

Net investment income (b)

  1.14  1.57  1.79  1.26  1.49%† 

Portfolio turnover rate**

  66  63  150  108  106
     

‡ Expense ratios exclude the estimated acquired fund fees of the affiliated/unaffiliated underlying

  

portfolios

  .22  .22  .11  .00  .00

 

 

See footnote summary on page 55.

 

54


  AB Variable Products Series Fund

 

(a) Based on average shares outstanding.

 

(b) Net of expenses waived/reimbursed by the Adviser.

 

(c) Amount is less than $.005.

 

(d) Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total return does not reflect (i) insurance company’s separate account related expense charges and (ii) the deductions of taxes that a shareholder would pay on Portfolio distributions or the redemption of Portfolio shares. Total investment return calculated for a period of less than one year is not annualized.

 

(e) In connection with the Portfolio’s investments in affiliated underlying portfolios, the Portfolio incurs no direct expenses, but bears proportionate shares of the fees and expenses (i.e., operating, administrative and investment advisory fees) of the affiliated underlying portfolios. The Adviser has contractually agreed to waive its fees from the Portfolio in an amount equal to the Portfolio’s pro rata share of certain acquired fund fees and expenses, and for the years ended December 31, 2020, December 31, 2019 and December 31, 2018, such waiver amounted to .20%, .20% and .09%, respectively.

 

(f) The expense ratios presented below exclude bank overdraft expense:

 

  Year Ended December 31, 
  2020  2019  2018  2017  2016 

Class A

     

Net of waivers/reimbursements

  N/A   .54  N/A   N/A   N/A 

Before waivers/reimbursements

  N/A   .75  N/A   N/A   N/A 

Class B

     

Net of waivers/reimbursements

  N/A   .79  N/A   N/A   N/A 

Before waivers/reimbursements

  N/A   1.00  N/A   N/A   N/A 

 

 For the year ended December 31, 2016, the amount includes a refund for overbilling of prior years’ custody out of pocket fees as follows:

 

Net Investment
Income Per Share

 

Net Investment
Income Ratio

 

Total
Return

$.001 .01% .01%

 

* Includes the impact of proceeds received and credited to the Portfolio resulting from class action settlements, which enhanced the Portfolio’s performance for the year ended December 31, 2017 by .02%.

 

** The Portfolio accounts for dollar roll transactions as purchases and sales.

See notes to financial statements.

 

55


 
REPORT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM AB Variable Products Series Fund

 

To the Shareholders and the Board of Directors of AB Balanced Wealth Strategy Portfolio:

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities of AB Balanced Wealth Strategy Portfolio (the “Portfolio”) (one of the portfolios constituting AB Variable Products Series Fund, Inc. (the “Fund”)), including the portfolio of investments, as of December 31, 2020, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Portfolio (one of the portfolios constituting AB Variable Products Series Fund, Inc.) at December 31, 2020, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended and its financial highlights for each of the five years in the period then ended, in conformity with U.S. generally accepted accounting principles.

Basis for Opinion

These financial statements are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the Portfolio’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of the Fund’s internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 31, 2020, by correspondence with the custodian and others or by other appropriate auditing procedures where replies from others were not received. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

 

LOGO

We have served as the auditor of one or more of the AB investment companies since 1968.

New York, New York

February 12, 2021

 

56


 
 
2020 TAX INFORMATION (unaudited) AB Variable Products Series Fund

 

For Federal income tax purposes, the following information is furnished with respect to the distributions paid by the Portfolio during the taxable year ended December 31, 2020. For corporate shareholders, 30.76% of dividends paid qualify for the dividends received deduction. The Portfolio designates $6,835,156 of dividends paid as long-term capital gain dividends.

 

57


 
BALANCED WEALTH STRATEGY 
PORTFOLIO AB Variable Products Series Fund

 

BOARD OF DIRECTORS  

Marshall C. Turner, Jr.(1), Chairman

Jorge A. Bermudez(1)

Michael J. Downey(1)

Nancy P. Jacklin(1)

  

Robert M. Keith*, President and
Chief Executive Officer

Jeanette W. Loeb(1)

Carol C. McMullen(1)

Garry L. Moody(1)

Earl D. Weiner(1)

  
  
OFFICERS  

Daniel J. Loewy(2), Vice President

Jess Gaspar(2), Vice President

Emilie D. Wrapp, Secretary

Michael B. Reyes, Senior Analyst

  

Joseph J. Mantineo, Treasurer and
Chief Financial
Officer

Phyllis J. Clarke, Controller

Vincent S. Noto, Chief Compliance Officer

  

CUSTODIANAND ACCOUNTING AGENT

State Street Bank and Trust Company

State Street Corporation CCB/5

1 Iron Street

Boston, MA 02210

  

LEGAL COUNSEL

Seward & Kissel LLP

One Battery Park Plaza

New York, NY 10004

  

DISTRIBUTOR

AllianceBernstein Investments, Inc.

1345 Avenue of the Americas

New York, NY 10105

  

TRANSFER AGENT

AllianceBernstein Investor Services, Inc.

P.O. Box 786003

San Antonio, TX 78278-6003

Toll-Free (800) 221-5672

  

INDEPENDENT REGISTERED PUBLIC

ACCOUNTING FIRM

Ernst & Young LLP

5 Times Square

New York, NY 10036

  

 

 

 

 

(1)

Member of the Audit Committee, the Governance and Nominating Committee, and the Independent Directors Committee.

 

(2)

The day-to-day management of, and investment decisions for, the Portfolio’s portfolio are made by the Adviser’s Multi-Asset Solutions Team. Messrs. Loewy and Gaspar are the investment professionals with the most significant responsibility for the day-to-day management of the Portfolio’s portfolio.

 

* Mr. Keith is expected to retire as President, Chief Executive Officer and a Director of the Fund as of March 31, 2021 and from the Adviser effective June 30, 2021.

 

58


 
BALANCED WEALTH STRATEGY PORTFOLIO
MANAGEMENT OF THE FUND AB Variable Products Series Fund

 

Board of Directors Information

The business and affairs of the Fund are managed under the direction of the Board of Directors. Certain information concerning the Fund’s Directors is set forth below.

 

NAME, ADDRESS*,

AGE AND

(YEAR FIRST ELECTED)**

 

PRINCIPAL
OCCUPATION(S),

DURING PAST FIVE YEARS

AND OTHER INFORMATION***

 PORTFOLIOS
IN AB FUND
COMPLEX
OVERSEEN BY
DIRECTOR
  OTHER PUBLIC
COMPANY
DIRECTORSHIPS
CURRENTLY
HELD BY
DIRECTOR
   
INTERESTED DIRECTOR  
   

Robert M. Keith,#

1345 Avenue of the Americas

New York, NY 10105

60

(2010)

 Senior Vice President of AllianceBernstein L.P. (the “Adviser”) and the head of AllianceBernstein Investments, Inc. (“ABI”) since July 2008; Director of ABI and President of the AB Mutual Funds. Previously, he served as Executive Managing Director of ABI from December 2006 to June 2008. Prior to joining ABI in 2006, Executive Managing Director of Bernstein Global Wealth Management, and prior thereto, Senior Managing Director and Global Head of Client Service and Sales of the Adviser’s institutional investment management business since 2004. Prior thereto, he was Managing Director and Head of North American Client Service and Sales in the Adviser’s institutional investment management business with which he had been associated since prior to 2004.  74  None
   
INDEPENDENT DIRECTORS  
   

Marshall C. Turner, Jr.,##

Chairman of the Board

79

(2005)

 Private Investor since prior to 2016. Former Chairman and CEO of Dupont Photomasks, Inc. (components of semi-conductor manufacturing). He was a Director of Xilinx, Inc. (programmable logic semiconductors and adaptable, intelligent computing) from 2007 through August 2020, and is a former director of 33 other companies and organizations. He has extensive operating leadership, and venture capital investing experience, including five interim or full-time CEO roles, and prior service as general partner of institutional venture capital partnerships. He also has extensive non-profit board leadership experience, and currently serves on the boards of two education and science-related non-profit organizations. He has served as a director of one AB Fund since 1992, and director or trustee of all AB Funds since 2005. He has been Chairman of the AB Funds since January 2014, and the Chairman of the Independent Directors Committees of such AB Funds since February 2014.  74  None
   

Jorge A. Bermudez,##

69

(2020)

 Private Investor since prior to 2016. Formerly, Chief Risk Officer of Citigroup, Inc., a global financial services company, from November 2007 to March 2008, Chief Executive Officer of Citigroup’s Commercial Business Group in North America and Citibank Texas from 2005 to 2007, and a variety of other executive and leadership roles at various businesses within Citigroup prior to then; Chairman (2018) of the Texas A&M Foundation Board of Trustees (Trustee since 2013) and Chairman of the Smart Grid Center Board at Texas A&M University since 2012; director of, among others, Citibank N.A. from 2005 to 2008, the Federal Reserve Bank of Dallas, Houston Branch from 2009 to 2011, the Federal Reserve Bank of Dallas from 2011 to 2017, and the Electric Reliability Council of Texas from 2010 to 2016. He has served as director or trustee of the AB Funds since January 2020.  74  Moody’s Corporation since April 2011

 

59


  AB Variable Products Series Fund

 

NAME, ADDRESS*,

AGE AND

(YEAR FIRST ELECTED)**

  

PRINCIPAL
OCCUPATION(S),

DURING PAST FIVE YEARS

AND OTHER INFORMATION***

 PORTFOLIOS
IN AB FUND
COMPLEX
OVERSEEN BY
DIRECTOR
  OTHER PUBLIC
COMPANY
DIRECTORSHIPS
CURRENTLY
HELD BY
DIRECTOR

INDEPENDENT DIRECTORS

(continued)

  
    

Michael J. Downey,##

77

(2005)

  Private Investor since prior to 2016. Formerly, Chairman of The Asia Pacific Fund, Inc. (registered investment company) since prior to 2016 until January 2019. From 1987 until 1993, Chairman and CEO of Prudential Mutual Fund Management, director of the Prudential mutual funds, and member of the Executive Committee of Prudential Securities, Inc. He has served as a director or trustee of the AB Funds since 2005.  74  None
    

Nancy P. Jacklin,##

72

(2006)

  Private Investor since prior to 2016. Professorial Lecturer at the Johns Hopkins School of Advanced International Studies (2008–2015). U.S. Executive Director of the International Monetary Fund (which is responsible for ensuring the stability of the international monetary system), (December 2002–May 2006); Partner, Clifford Chance (1992–2002); Sector Counsel, International Banking and Finance, and Associate General Counsel, Citicorp (1985–1992); Assistant General Counsel (International), Federal Reserve Board of Governors (1982–1985); and Attorney Advisor, U.S. Department of the Treasury (1973–1982). Member of the Bar of the District of Columbia and of New York; and member of the Council on Foreign Relations. She has served as a director or trustee of the AB Funds since 2006 and has been Chair of the Governance and Nominating Committees of the AB Funds since August 2014.  74  None
    

Jeanette W. Loeb,##

68

(2020)

  Chief Executive Officer of PetCareRx (e-commerce pet pharmacy) from 2002 to 2011 and 2015 to present. Director of New York City Center since 2005. She was a director of AB Multi-Manager Alternative Fund, Inc. (fund of hedge funds) from 2012 to 2018. Formerly, affiliated with Goldman Sachs Group, Inc. (financial services) from 1977 to 1994, including as a partner thereof from 1986 to 1994. She has served as director or trustee of the AB Funds since April 2020.  74  

Apollo Investment Corp. (business development company) since August 2011

    

 

60


BALANCED WEALTH STRATEGY PORTFOLIO
MANAGEMENT OF THE FUND 
(continued) AB Variable Products Series Fund

 

NAME, ADDRESS*,

AGE AND

(YEAR FIRST ELECTED)**

  

PRINCIPAL
OCCUPATION(S),

DURING PAST FIVE YEARS

AND OTHER INFORMATION***

 PORTFOLIOS
IN AB FUND
COMPLEX
OVERSEEN BY
DIRECTOR
  OTHER PUBLIC
COMPANY
DIRECTORSHIPS
CURRENTLY
HELD BY
DIRECTOR

INDEPENDENT DIRECTORS

(continued)

  
    

Carol C . McMullen,##

65

(2016)

  Managing Director of Slalom Consulting (consulting) since 2014, private investor and a member of the Advisory Board of Butcher Box (since 2018). Formerly, member, Partners Healthcare Investment Committee (2010–2019); Director of Norfolk & Dedham Group (mutual property and casualty insurance) from 2011 until November 2016; Director of Partners Community Physicians Organization (healthcare) from 2014 until December 2016; and Managing Director of The Crossland Group (consulting) from 2012 until 2013. She has held a number of senior positions in the asset and wealth management industries, including at Eastern Bank (where her roles included President of Eastern Wealth Management), Thomson Financial (Global Head of Sales for Investment Management), and Putnam Investments (where her roles included Chief Investment Officer, Core and Growth and Head of Global Investment Research). She has served on a number of private company and non-profit boards, and as a director or trustee of the AB Funds since June 2016.  74  None
    

Garry L. Moody,##

68

(2008)

  Private Investor since prior to 2016. Formerly, Partner, Deloitte & Touche LLP (1995–2008) where he held a number of senior positions, including Vice Chairman, and U.S .. and Global Investment Management Practice Managing Partner; President, Fidelity Accounting and Custody Services Company (1993–1995), where he was responsible for accounting, pricing, custody and reporting for the Fidelity mutual funds; and Partner, Ernst & Young LLP (1975–1993), where he served as the National Director of Mutual Fund Tax Services and Managing Partner of its Chicago Office Tax department. He is a member of the Trustee Advisory Board of BoardIQ, a biweekly publication focused on issues and news affecting directors of mutual funds. He is also a member of the Investment Company Institute’s Board of Governors and the Independent Directors Council’s Governing Council. He has served as a director or trustee, and as Chairman of the Audit Committees, of the AB Funds since 2008.  74  None
    

 

61


  AB Variable Products Series Fund

 

NAME, ADDRESS*,

AGE AND

(YEAR FIRST ELECTED)**

  

PRINCIPAL
OCCUPATION(S),

DURING PAST FIVE YEARS

AND OTHER INFORMATION***

 PORTFOLIOS
IN AB FUND
COMPLEX
OVERSEEN BY
DIRECTOR
  OTHER PUBLIC
COMPANY
DIRECTORSHIPS
CURRENTLY
HELD BY
DIRECTOR

INDEPENDENT DIRECTORS

(continued)

  
    

Earl D. Weiner,##

81

(2007)

  Senior Counsel since 2017, Of Counsel from 2007 to 2016, and Partner prior to then, of the law firm Sullivan & Cromwell LLP. He is a former member of the ABA Federal Regulation of Securities Committee Task Force to draft editions of the Fund Director’s Guidebook. He also serves as a director or trustee of various non-profit organizations and has served as Chairman or Vice Chairman of a number of them. He has served as a director or trustee of the AB Funds since 2007 and served as Chairman of the Governance and Nominating Committees of the AB Funds from 2007 until August 2014.  74  None

 

 

 

 

*

The address for each of the Company’s Directors is c/o AllianceBernstein L.P., Attention: Legal and Compliance Department—Mutual Fund Legal, 1345 Avenue of the Americas, New York, NY 10105.

 

**

There is no stated term of office for the Fund’s Directors.

 

***

The information above includes each Director’s principal occupation during the last five years and other information relating to the experience, attributes and skills relevant to each Director’s qualifications to serve as a Director, which led to the conclusion that each Director should serve as a Director for the Fund.

 

#

Mr. Keith is an “interested person”, as defined in the 1940 Act, due to his position as a Senior Vice President of the Adviser. He is expected to retire as President, Chief Executive Officer and a Director of the Fund as of March 31, 2021 and from the Adviser effective June 30, 2021. Mr. Onur Erzan, Senior Vice President and Head of the Global Client Group of the Adviser, has been elected President, Chief Executive Officer and a Director of the Fund, effective April 1, 2021.

 

##

Member of the Audit Committee, the Governance and Nominating Committee, and the Independent Directors Committee.

 

62


BALANCED WEALTH STRATEGY PORTFOLIO
MANAGEMENT OF THE FUND 
(continued) AB Variable Products Series Fund

 

Officer Information

Certain information concerning the Portfolio’s Officers is listed below.

 

NAME, ADDRESS*
AND AGE
    PRINCIPAL POSITION(S)
HELD WITH FUND
    PRINCIPAL OCCUPATION
DURING PAST FIVE YEARS

Robert M. Keith^

60

    President and Chief
Executive Officer
    See biography above.
        

Daniel J. Loewy

46

    Vice President    Senior Vice President of the Adviser**, with which he has been associated since prior to 2016. He is also Chief Investment Officer and Head of Multi-Asset Solutions and Chief Investment Officer for Dynamic Asset Allocation.
        

Jess Gaspar

52

    Vice President    Senior Vice President of the Adviser**, with which he has been associated since December 2016.
        

Emilie D. Wrapp

65

    Secretary    Senior Vice President, Assistant General Counsel and Assistant Secretary of ABI**, with which she has been associated since prior to 2016.
        

Michael B. Reyes

44

    Senior Analyst    Vice President of the Adviser**, with which he has been associated since prior to 2016.
        

Joseph J. Mantineo

61

    Treasurer and Chief
Financial Officer
    Senior Vice President of AllianceBernstein Investor Services, Inc. (“ABIS”)**, with which he has been associated since prior to 2016.
        

Phyllis J. Clarke

60

    Controller    Vice President of the ABIS**, with which she has been associated since prior to 2016.
        

Vincent S. Noto

56

    Chief Compliance Officer    Senior Vice President and Mutual Fund Chief Compliance Officer of the Adviser** since prior to 2016.

 

 

 

* The address for each of the Portfolio’s Officers is 1345 Avenue of the Americas, New York, NY 10105.

 

** The Adviser, ABI, and ABIS are affiliates of the Fund.

 

^ Mr. Keith is expected to retire as President, Chief Executive Officer and a Director of the Fund as of March 31, 2021 and from the Adviser effective June 30, 2021. Mr. Onur Erzan, Senior Vice President and Head of the Global Client Group of the Adviser, has been elected President, Chief Executive Officer and a Director of the Fund, effective April 1, 2021.

 

     The Fund’s Statement of Additional Information (“SAI”) has additional information about the Fund’s Directors and Officers and is available without charge upon request. Contact your financial representative or the Adviser at (800) 227-4618, or visit www.abfunds.com, for a free prospectus or SAI.

 

63


 
 
BALANCED WEALTH STRATEGY PORTFOLIO AB Variable Products Series Fund

 

OPERATION AND EFFECTIVENESS OF THE PORTFOLIO’S LIQUIDITY RISK MANAGEMENT PROGRAM:

In October 2016, the Securities and Exchange Commission (“SEC”) adopted the open-end fund liquidity rule (the “Liquidity Rule”). In June 2018 the SEC adopted a requirement that funds disclose information about the operation and effectiveness of their Liquidity Risk Management Program (“LRMP”) in their reports to shareholders.

One of the requirements of the Liquidity Rule is for the Portfolio to designate an Administrator of the Portfolio’s Liquidity Risk Management Program. The Administrator of the Portfolio’s LRMP is AllianceBernstein L.P., the Portfolio’s investment adviser (the “Adviser”). The Adviser has delegated the responsibility to its Liquidity Risk Management Committee (the “Committee”). Another requirement of the Liquidity Rule is for the Portfolio’s Board of Directors (the “Fund Board”) to receive an annual written report from the Administrator of the LRMP, which addresses the operation of the Portfolio’s LRMP and assesses its adequacy and effectiveness. The Adviser provided the Fund Board with such annual report during the first quarter of 2020, which covered the period December 1, 2018 through December 31, 2019 (the “Program Reporting Period”).

The LRMP’s principal objectives include supporting the Portfolio’s compliance with limits on investments in illiquid assets and mitigating the risk that the Portfolio will be unable to meet its redemption obligations in a timely manner. Pursuant to the LRMP, the Portfolio classifies the liquidity of its portfolio investments into one of the four categories defined by the SEC: Highly Liquid, Moderately Liquid, Less Liquid, and Illiquid. These classifications are reported to the SEC on Form N-PORT.

During the Program Reporting Period, the Committee reviewed whether the Portfolio’s strategy is appropriate for an open-end structure, taking into account any holdings of less liquid and illiquid assets. If the Portfolio participated in derivative transactions, the exposure from such transactions were considered in the LRMP. The Committee also performed an analysis