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 811-08416
Touchstone Variable Series Trust
(Exact name of registrant as specified in charter)
303 Broadway, Suite 1100
Cincinnati, Ohio 45202-4203
(Address of principal executive offices) (Zip code)
Jill T. McGruder
303 Broadway, Suite 1100
Cincinnati, Ohio 45202-4203
(Name and address of agent for service)
Registrant's telephone number, including area code: 800-638-8194
Date of fiscal year end:December 31
Date of reporting period:June 30, 2019
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.
Item 1. Reports to Stockholders.
The Report to Shareholders is attached herewith.
June 30, 2019
(Unaudited)
Semi-Annual Report
Touchstone Variable Series Trust
Touchstone Active Bond Fund
Touchstone Balanced Fund
Touchstone Bond Fund
Touchstone Common Stock Fund
Touchstone Focused Fund
Touchstone Large Cap Core Equity Fund
Touchstone Small Company Fund
Touchstone Aggressive ETF Fund
Touchstone Conservative ETF Fund
Touchstone Moderate ETF Fund
IMPORTANT NOTE: Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, you may not be receiving paper copies of a Fund’s annual or semi-annual shareholder reports by mail, unless you specifically request paper copies of the reports from the insurance company that offers your variable annuity or variable life insurance contract or from your financial intermediary. Instead of delivering paper copies of the report, the insurance company may choose to make the reports available on a website, and the insurance company will notify you by mail each time a shareholder 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 electronically by following the instructions provided by the insurance company.
You may elect to receive all future Fund shareholder reports in paper free of charge from the insurance company. You can inform the insurance company that you wish to continue receiving paper copies of your shareholder reports by following the instructions provided by the insurance company. Your election to receive reports in paper will apply to all portfolio companies available under your contract with the insurance company.
Table of Contents
This report identifies the Funds' investments on June 30, 2019. These holdings are subject to change. Not all investments in each Fund performed the same, nor is there any guarantee that these investments will perform as well in the future. Market forecasts provided in this report may not occur.
2 |
Tabular Presentation of Portfolios of Investments (Unaudited)
June 30, 2019
The illustrations below provide each Fund’s credit quality and/or sector allocation. We hope it will be useful to shareholders as it summarizes key information about each Fund’s investments.
Touchstone Active Bond Fund | ||||
Credit Quality* | (% of Investment Securities) | |||
AAA/Aaa | 50.0 | % | ||
AA/Aa | 5.2 | |||
A/A | 11.2 | |||
BBB/Baa | 25.1 | |||
BB/Ba | 0.4 | |||
CCC | 0.1 | |||
Not Rated | 5.2 | |||
Cash Equivalents | 2.8 | |||
Total | 100.0 | % | ||
Touchstone Balanced Fund | ||||
Credit Quality* | (% of Fixed Income Securities) | |||
AAA/Aaa | 65.6 | % | ||
AA/Aa | 3.9 | |||
A/A | 9.5 | |||
BBB/Baa | 21.0 | |||
100.0 | % | |||
Sector Allocation** | (% of Net Assets) | |||
Common Stocks | ||||
Information Technology | 14.0 | % | ||
Communication Services | 11.6 | |||
Financials | 10.7 | |||
Consumer Discretionary | 8.3 | |||
Health Care | 6.9 | |||
Industrials | 3.8 | |||
Real Estate | 2.6 | |||
Consumer Staples | 2.3 | |||
Energy | 2.2 | |||
U.S. Treasury Obligations | 15.5 | |||
Corporate Bonds | 12.1 | |||
U.S. Government Mortgage-Backed Obligations | 6.7 | |||
Exchange-Traded Fund | 1.8 | |||
Sovereign Bonds | 0.1 | |||
Short-Term Investment Fund | 1.2 | |||
Other Assets/Liabilities (Net) | 0.2 | |||
Total | 100.0 | % | ||
* | Credit quality ratings are from Standard & Poor's (“S&P”) and Moody's Investors Service (“Moody's”). If agency ratings differ, the higher rating will be used. Where no rating has been assigned, it may be for reasons unrelated to the creditworthiness of the issuer. |
** | Sector Classifications are based upon the Global Industry Classification Standard (GICS®). |
3 |
Tabular Presentation of Portfolios of Investments(Unaudited) (Continued)
Touchstone Bond Fund | ||||
Credit Quality* | (% of Investment Securities) | |||
AAA/Aaa | 59.6 | % | ||
AA/Aa | 3.3 | |||
A/A | 7.6 | |||
BBB/Baa | 22.1 | |||
BB/Ba | 0.3 | |||
Not Rated | 5.5 | |||
Cash Equivalents | 1.6 | |||
Total | 100.0 | % | ||
Touchstone Focused Fund | ||||
Sector Allocation** | (% of Net Assets) | |||
Information Technology | 20.2 | % | ||
Financials | 17.3 | |||
Communication Services | 17.3 | |||
Health Care | 14.1 | |||
Consumer Discretionary | 12.5 | |||
Industrials | 6.7 | |||
Real Estate | 4.8 | |||
Energy | 3.5 | |||
Consumer Staples | 3.0 | |||
Short-Term Investment Fund | 0.8 | |||
Other Assets/Liabilities (Net) | (0.2 | ) | ||
Total | 100.0 | % | ||
Touchstone Common Stock Fund | ||||
Sector Allocation** | (% of Net Assets) | |||
Communication Services | 20.3 | % | ||
Information Technology | 19.2 | |||
Financials | 18.1 | |||
Health Care | 12.5 | |||
Consumer Discretionary | 11.8 | |||
Industrials | 6.7 | |||
Real Estate | 4.7 | |||
Energy | 3.6 | |||
Consumer Staples | 2.9 | |||
Short-Term Investment Fund | 0.3 | |||
Other Assets/Liabilities (Net) | (0.1 | ) | ||
Total | 100.0 | % | ||
Touchstone Large Cap Core Equity Fund | ||||
Sector Allocation** | (% of Net Assets) | |||
Financials | 22.5 | % | ||
Consumer Discretionary | 20.4 | |||
Information Technology | 13.3 | |||
Industrials | 12.1 | |||
Communication Services | 9.3 | |||
Materials | 7.9 | |||
Consumer Staples | 7.3 | |||
Energy | 3.2 | |||
Health Care | 1.5 | |||
Short-Term Investment Fund | 2.6 | |||
Other Assets/Liabilities (Net) | (0.1 | ) | ||
Total | 100.0 | % | ||
* | Credit quality ratings are from Standard & Poor's (“S&P”) and Moody's Investors Service (“Moody's”). If agency ratings differ, the higher rating will be used. Where no rating has been assigned, it may be for reasons unrelated to the creditworthiness of the issuer. |
** | Sector Classifications are based upon the Global Industry Classification Standard (GICS®). |
4 |
Tabular Presentation of Portfolios of Investments (Unaudited) (Continued)
Touchstone Small Company Fund | ||||
Sector Allocation* | (% of Net Assets) | |||
Industrials | 22.7 | % | ||
Health Care | 20.9 | |||
Information Technology | 19.5 | |||
Consumer Discretionary | 19.1 | |||
Financials | 8.5 | |||
Communication Services | 3.4 | |||
Real Estate | 1.1 | |||
Consumer Staples | 0.7 | |||
Short-Term Investment Funds | 5.1 | |||
Other Assets/Liabilities (Net) | (1.0 | ) | ||
Total | 100.0 | % | ||
Touchstone Conservative ETF Fund | ||||
Sector Allocation | (% of Net Assets) | |||
Exchange-Traded Funds | ||||
Fixed Income Funds | 58.2 | % | ||
Equity Funds | 41.0 | |||
Short-Term Investment Funds | 11.3 | |||
Other Assets/Liabilities (Net) | (10.5 | ) | ||
Total | 100.0 | % | ||
Touchstone Aggressive ETF Fund | ||||
Sector Allocation | (% of Net Assets) | |||
Exchange-Traded Funds | ||||
Equity Funds | 79.9 | % | ||
Fixed Income Funds | 17.0 | |||
Short-Term Investment Fund | 3.1 | |||
Other Assets/Liabilities (Net) | 0.0 | |||
Total | 100.0 | % | ||
Touchstone Moderate ETF Fund | ||||
Sector Allocation | (% of Net Assets) | |||
Exchange-Traded Funds | ||||
Equity Funds | 60.1 | % | ||
Fixed Income Funds | 36.9 | |||
Short-Term Investment Fund | 3.0 | |||
Other Assets/Liabilities (Net) | 0.0 | |||
Total | 100.0 | % | ||
* | Sector Classifications are based upon the Global Industry Classification Standard (GICS®). |
5 |
Touchstone Active Bond Fund –June 30, 2019 (Unaudited)
Principal | Market | |||||||
Amount | Value | |||||||
Corporate Bonds — 36.1% | ||||||||
Financials — 9.8% | ||||||||
$ | 147,000 | Allstate Corp. (The), Ser B, 5.750%, 8/15/53 | $ | 154,087 | ||||
218,000 | American Express Co., 3.000%, 10/30/24 | 223,465 | ||||||
144,000 | Bank of America Corp., 3.705%, 4/24/28 | 151,301 | ||||||
245,000 | Bank of America Corp. MTN, 4.000%, 1/22/25 | 257,693 | ||||||
212,000 | Bank of Montreal (Canada), 3.803%, 12/15/32 | 214,991 | ||||||
212,000 | Bank of New York Mellon Corp. (The) MTN, 2.950%, 1/29/23 | 216,438 | ||||||
230,000 | Bank of Nova Scotia (The), (Canada), (3M LIBOR +0.620%), 3.039%, 9/19/22(A) | 230,735 | ||||||
200,000 | Barclays PLC (United Kingdom), 4.610%, 2/15/23 | 206,936 | ||||||
210,000 | BB&T Corp. MTN, 2.850%, 10/26/24 | 215,249 | ||||||
125,000 | Citigroup, Inc., 3.200%, 10/21/26 | 127,480 | ||||||
320,000 | Citigroup, Inc., (3M LIBOR +1.430%), 3.950%, 9/1/23(A) | 325,901 | ||||||
84,000 | Citigroup, Inc., 4.750%, 5/18/46 | 95,009 | ||||||
175,000 | Fifth Third Bancorp, 2.875%, 7/27/20 | 175,804 | ||||||
111,000 | GE Capital International Funding Co. Unlimited Co. (Ireland), 4.418%, 11/15/35 | 109,863 | ||||||
280,000 | Goldman Sachs Group, Inc. (The), (3M LIBOR +1.000%), 3.581%, 7/24/23(A) | 280,477 | ||||||
110,000 | Goldman Sachs Group, Inc. (The), 3.691%, 6/5/28 | 113,604 | ||||||
115,000 | Goldman Sachs Group, Inc. (The), 5.250%, 7/27/21 | 121,550 | ||||||
200,000 | HSBC Holdings PLC (United Kingdom), 3.900%, 5/25/26 | 208,911 | ||||||
300,000 | Huntington Bancshares, Inc., 4.000%, 5/15/25 | 320,067 | ||||||
145,000 | JPMorgan Chase & Co., 3.250%, 9/23/22 | 148,963 | ||||||
155,000 | JPMorgan Chase & Co., (3M LIBOR +0.730%), 3.322%, 4/23/24(A) | 154,587 | ||||||
205,000 | JPMorgan Chase & Co., 3.509%, 1/23/29 | 213,125 | ||||||
216,000 | Lloyds Banking Group PLC (United Kingdom), 3.574%, 11/7/28 | 216,222 | ||||||
170,000 | Morgan Stanley, 3.950%, 4/23/27 | 177,816 | ||||||
243,000 | New York Life Global Funding, 144a, 3.000%, 1/10/28 | 248,513 | ||||||
155,000 | Northwestern Mutual Life Insurance Co. (The), 144a, 3.850%, 9/30/47 | 160,010 | ||||||
159,000 | PNC Capital Trust C, (3M LIBOR +0.570%), 3.090%, 6/1/28(A) | 143,240 | ||||||
215,000 | SunTrust Banks, Inc., 4.000%, 5/1/25 | 230,217 | ||||||
269,000 | SunTrust Capital I, Ser A, (3M LIBOR +0.670%), 3.190%, 5/15/27(A) | 246,808 | ||||||
5,689,062 | ||||||||
Energy — 4.1% | ||||||||
234,000 | Boardwalk Pipelines LP, 4.450%, 7/15/27 | 239,266 | ||||||
175,000 | Buckeye Partners LP, 3.950%, 12/1/26 | 155,091 | ||||||
142,000 | Canadian Natural Resources Ltd. (Canada), 6.250%, 3/15/38 | 175,329 | ||||||
184,000 | Cenovus Energy, Inc. (Canada), 4.250%, 4/15/27 | 190,601 | ||||||
196,000 | Cheniere Corpus Christi Holdings LLC, 7.000%, 6/30/24 | 225,420 | ||||||
162,000 | Columbia Pipeline Group, Inc., 4.500%, 6/1/25 | 174,346 | ||||||
215,000 | Energy Transfer Partners LP, 4.950%, 6/15/28 | 235,064 | ||||||
198,000 | Midcontinent Express Pipeline LLC, 144a, 6.700%, 9/15/19 | 198,921 | ||||||
116,000 | NGPL PipeCo LLC, 144a, 7.768%, 12/15/37 | 147,320 | ||||||
135,000 | Petroleos Mexicanos (Mexico), 4.500%, 1/23/26 | 123,954 | ||||||
155,000 | Petroleos Mexicanos (Mexico), 144a, 6.350%, 2/12/48 | 133,067 | ||||||
210,000 | Shell International Finance BV (Netherlands), 1.875%, 5/10/21 | 209,070 | ||||||
179,000 | Woodside Finance Ltd. (Australia), 144a, 4.500%, 3/4/29 | 189,148 | ||||||
2,396,597 | ||||||||
Industrials — 3.7% | ||||||||
212,000 | Avolon Holdings Funding Ltd. (Cayman Islands), 144a, 3.625%, 5/1/22 | 214,883 | ||||||
265,000 | Burlington Northern Santa Fe LLC, 5.750%, 5/1/40 | 349,294 | ||||||
200,000 | CRH America Finance, Inc., 144a, 4.500%, 4/4/48 | 197,234 | ||||||
226,000 | Eagle Materials, Inc., 4.500%, 8/1/26 | 230,781 | ||||||
91,000 | Embraer Netherlands Finance BV (Netherlands), 5.050%, 6/15/25 | 98,167 | ||||||
93,000 | Embraer Netherlands Finance BV (Netherlands), 5.400%, 2/1/27 | 103,138 | ||||||
217,000 | FedEx Corp., 5.100%, 1/15/44 | 238,742 | ||||||
110,000 | Norfolk Southern Corp., 4.837%, 10/1/41 | 127,381 | ||||||
216,000 | Parker-Hannifin Corp., 4.000%, 6/14/49 | 228,547 | ||||||
150,000 | Vulcan Materials Co., 4.500%, 4/1/25 | 159,899 | ||||||
210,000 | Wabtec Corp., 4.950%, 9/15/28 | 225,166 | ||||||
2,173,232 | ||||||||
Communication Services — 3.2% | ||||||||
157,000 | Activision Blizzard, Inc., 4.500%, 6/15/47 | 162,630 | ||||||
40,000 | AT&T, Inc., 4.350%, 6/15/45 | 39,987 | ||||||
155,000 | AT&T, Inc., 4.500%, 5/15/35 | 162,255 | ||||||
112,000 | Charter Communications Operating LLC / Charter Communications Operating Capital, 6.484%, 10/23/45 | 131,971 |
6 |
Touchstone Active Bond Fund (Unaudited) (Continued)
Principal | Market | |||||||
Amount | Value | |||||||
Corporate Bonds — 36.1% (Continued) | ||||||||
Communication Services — (Continued) | ||||||||
$ | 138,000 | Comcast Corp., 4.000%, 3/1/48 | $ | 145,978 | ||||
165,000 | Comcast Corp., 4.150%, 10/15/28 | 181,855 | ||||||
141,000 | Cox Communications, Inc., 144a, 3.350%, 9/15/26 | 142,381 | ||||||
78,000 | Deutsche Telekom International Finance BV (Netherlands), 8.750%, 6/15/30 | 112,318 | ||||||
214,000 | Tencent Holdings Ltd. (Cayman Islands), 144a, 3.975%, 4/11/29 | 223,612 | ||||||
331,000 | Verizon Communications, Inc., 5.012%, 4/15/49 | 394,218 | ||||||
153,000 | Warner Media LLC, 3.800%, 2/15/27 | 152,898 | ||||||
1,850,103 | ||||||||
Health Care — 3.1% | ||||||||
58,000 | Abbott Laboratories, 3.750%, 11/30/26 | 62,709 | ||||||
174,000 | AbbVie, Inc., 4.450%, 5/14/46 | 170,884 | ||||||
90,000 | Allergan Funding SCS (Luxembourg), 3.800%, 3/15/25 | 93,400 | ||||||
205,000 | Allergan Sales LLC, 144a, 5.000%, 12/15/21 | 214,374 | ||||||
142,000 | Celgene Corp., 5.000%, 8/15/45 | 168,523 | ||||||
164,000 | Cigna Corp., 144a, 4.375%, 10/15/28 | 176,934 | ||||||
185,000 | CommonSpirit Health, 4.200%, 8/1/23 | 195,174 | ||||||
200,000 | CVS Health Corp., 4.300%, 3/25/28 | 210,896 | ||||||
130,000 | CVS Health Corp., 5.125%, 7/20/45 | 138,634 | ||||||
160,000 | Express Scripts Holding Co., 3.300%, 2/25/21 | 162,124 | ||||||
204,000 | Shire Acquisitions Investments Ireland DAC (Ireland), 2.400%, 9/23/21 | 203,749 | ||||||
1,797,401 | ||||||||
Information Technology — 2.9% | ||||||||
235,000 | Apple, Inc., 2.750%, 1/13/25 | 240,245 | ||||||
148,000 | Apple, Inc., 4.650%, 2/23/46 | 175,540 | ||||||
215,000 | Broadcom, Inc., 144a, 3.125%, 4/15/21 | 216,392 | ||||||
175,000 | Hewlett Packard Enterprise Co., 144a, 2.100%, 10/4/19 | 174,755 | ||||||
202,000 | International Business Machines Corp., 2.800%, 5/13/21 | 204,432 | ||||||
85,000 | Microsoft Corp., 3.500%, 2/12/35 | 90,695 | ||||||
210,000 | NXP BV / NXP Funding LLC (Netherlands), 144a, 5.350%, 3/1/26 | 232,556 | ||||||
170,000 | Oracle Corp., 2.650%, 7/15/26 | 170,778 | ||||||
134,000 | Visa, Inc., 4.150%, 12/14/35 | 153,996 | ||||||
1,659,389 | ||||||||
Consumer Staples — 2.7% | ||||||||
250,000 | Anheuser-Busch Cos LLC / Anheuser-Busch InBev Worldwide, Inc., 4.900%, 2/1/46 | 278,358 | ||||||
200,000 | Grupo Bimbo SAB de CV (Mexico), 144a, 4.500%, 1/25/22 | 206,931 | ||||||
292,000 | Imperial Brands Finance PLC (United Kingdom), 144a, 4.250%, 7/21/25 | 306,415 | ||||||
192,000 | Kraft Heinz Foods Co., 6.875%, 1/26/39 | 230,582 | ||||||
116,000 | Kroger Co. (The), 5.000%, 4/15/42 | 120,821 | ||||||
210,000 | Mars, Inc., 144a, 3.875%, 4/1/39 | 222,364 | ||||||
192,000 | Reynolds American, Inc., 4.450%, 6/12/25 | 203,597 | ||||||
1,569,068 | ||||||||
Real Estate — 2.5% | ||||||||
208,000 | Boston Properties LP REIT, 3.200%, 1/15/25 | 212,333 | ||||||
185,000 | Crown Castle International Corp. REIT, 3.650%, 9/1/27 | 190,512 | ||||||
61,000 | Mid-America Apartments LP, REIT, 3.750%, 6/15/24 | 63,485 | ||||||
193,000 | Sabra Health Care LP REIT, 5.125%, 8/15/26 | 200,903 | ||||||
205,000 | SL Green Operating Partnership LP REIT, 3.250%, 10/15/22 | 207,736 | ||||||
131,000 | Spirit Realty LP REIT, 4.450%, 9/15/26 | 137,169 | ||||||
260,000 | VEREIT Operating Partnership LP REIT, 4.600%, 2/6/24 | 276,085 | ||||||
184,000 | Welltower, Inc. REIT, 4.250%, 4/1/26 | 196,088 | ||||||
1,484,311 | ||||||||
Consumer Discretionary — 2.0% | ||||||||
230,000 | AutoNation, Inc., 5.500%, 2/1/20 | 233,334 | ||||||
214,000 | Dollar General Corp., 3.250%, 4/15/23 | 219,822 | ||||||
133,000 | Ford Motor Credit Co. LLC, 5.584%, 3/18/24 | 142,759 | ||||||
146,000 | General Motors Financial Co., Inc., 4.350%, 4/9/25 | 150,611 | ||||||
150,000 | Home Depot, Inc. (The), 5.950%, 4/1/41 | 203,363 | ||||||
2,018 | United Airlines 2014-2 Class B Pass Through Trust, 4.625%, 9/3/22 | 2,076 | ||||||
208,000 | Walmart, Inc., 2.850%, 7/8/24 | 214,896 | ||||||
1,166,861 | ||||||||
Utilities — 1.7% | ||||||||
53,000 | American Water Capital Corp., 6.593%, 10/15/37 | 72,493 | ||||||
69,000 | DTE Energy Co., 3.700%, 8/1/23 | 72,000 | ||||||
213,000 | Electricite de France SA (France), 144a, 4.500%, 9/21/28 | 233,592 | ||||||
160,000 | NextEra Energy Capital Holdings, Inc., 5.650%, 5/1/79 | 165,038 | ||||||
150,000 | Oncor Electric Delivery Co. LLC, 3.800%, 9/30/47 | 156,868 | ||||||
124,000 | PacifiCorp., 5.750%, 4/1/37 | 158,710 | ||||||
178,000 | WEC Energy Group, Inc., (3M LIBOR +2.113%), 4.631%, 5/15/67(A) | 146,850 | ||||||
1,005,551 | ||||||||
Materials — 0.4% | ||||||||
192,000 | Sherwin-Williams Co. (The), 4.500%, 6/1/47 | 204,786 | ||||||
Total Corporate Bonds | $ | 20,996,361 |
7 |
Touchstone Active Bond Fund (Unaudited) (Continued)
Principal | Market | |||||||
Amount | Value | |||||||
U.S. Treasury Obligations — 33.1% | ||||||||
$ | 2,160,000 | U.S. Treasury Bond, 3.000%, 2/15/49 | $ | 2,372,287 | ||||
3,552,331 | U.S. Treasury Inflation Indexed Bonds, 0.875%, 1/15/29 | 3,739,045 | ||||||
200,000 | U.S. Treasury Note, 2.125%, 3/31/24 | 203,344 | ||||||
189,000 | U.S. Treasury Note, 2.125%, 5/31/26 | 192,160 | ||||||
2,455,000 | U.S. Treasury Note, 2.250%, 4/30/21 | 2,475,618 | ||||||
86,000 | U.S. Treasury Note, 2.375%, 5/15/29 | 88,872 | ||||||
925,000 | U.S. Treasury Note, 2.500%, 5/31/20 | 929,083 | ||||||
7,949,000 | U.S. Treasury Note, 2.500%, 3/31/23 | 8,170,703 | ||||||
1,018,000 | U.S. Treasury Note, 2.625%, 2/15/29 | 1,073,513 | ||||||
Total U.S. Treasury Obligations | $ | 19,244,625 | ||||||
U.S. Government Mortgage-Backed Obligations — 9.1% | ||||||||
110,751 | FHLMC, Pool #A95946, 4.000%, 1/1/41 | 116,876 | ||||||
81,146 | FHLMC, Pool #A96485, 4.500%, 1/1/41 | 87,211 | ||||||
22,058 | FHLMC, Pool #G03217, 5.500%, 9/1/37 | 23,638 | ||||||
13,061 | FHLMC, Pool #G03781, 6.000%, 1/1/38 | 14,772 | ||||||
54,566 | FHLMC, Pool #J27931, 3.500%, 4/1/29 | 56,782 | ||||||
287,485 | FHLMC, Pool #Q51274, 4.000%, 10/1/47 | 299,565 | ||||||
5,444 | FNMA, Pool #561741, 7.500%, 1/1/31 | 6,160 | ||||||
8,329 | FNMA, Pool #889734, 5.500%, 6/1/37 | 9,247 | ||||||
9,839 | FNMA, Pool #984256, 5.000%, 6/1/23 | 10,143 | ||||||
8,395 | FNMA, Pool #995472, 5.000%, 11/1/23 | 8,645 | ||||||
60,273 | FNMA, Pool #AB1149, 5.000%, 6/1/40 | 65,484 | ||||||
58,039 | FNMA, Pool #AB1800, 4.000%, 11/1/40 | 61,210 | ||||||
93,542 | FNMA, Pool #AD3795, 4.500%, 4/1/40 | 100,468 | ||||||
134,649 | FNMA, Pool #AD9150, 5.000%, 8/1/40 | 146,326 | ||||||
186,163 | FNMA, Pool #AE0548, 4.500%, 11/1/40 | 199,949 | ||||||
149,357 | FNMA, Pool #AE4429, 4.000%, 10/1/40 | 157,479 | ||||||
10,932 | FNMA, Pool #AH2666, 4.000%, 1/1/26 | 11,373 | ||||||
18,005 | FNMA, Pool #AH3493, 4.000%, 2/1/26 | 18,774 | ||||||
236,157 | FNMA, Pool #AJ5457, 4.000%, 11/1/41 | 249,064 | ||||||
230,563 | FNMA, Pool #AL0054, 4.500%, 2/1/41 | 247,595 | ||||||
37,045 | FNMA, Pool #AL2663, 4.000%, 1/1/26 | 38,534 | ||||||
225,922 | FNMA, Pool #AS7813, 4.000%, 8/1/46 | 236,578 | ||||||
324,690 | FNMA, Pool #AS8552, 3.000%, 12/1/36 | 330,875 | ||||||
571,041 | FNMA, Pool #AS8855, 3.500%, 2/1/37 | 588,253 | ||||||
608,539 | FNMA, Pool #BH6180, 4.000%, 7/1/47 | 634,207 | ||||||
281,386 | FNMA, Pool #MA1175, 3.000%, 9/1/42 | 286,233 | ||||||
165,479 | FNMA, Pool #MA1543, 3.500%, 8/1/33 | 171,634 | ||||||
148,470 | FNMA, Pool #MA2177, 4.000%, 2/1/35 | 156,371 | ||||||
210,649 | GNMA, Pool #4853, 4.000%, 11/20/40 | 223,099 | ||||||
141,328 | GNMA, Pool #4883, 4.500%, 12/20/40 | 150,859 | ||||||
64,311 | GNMA, Pool #736696, 4.500%, 5/15/40 | 69,334 | ||||||
284,378 | GNMA, Pool #AD1745, 3.000%, 2/20/43 | 291,209 | ||||||
212,009 | GNMA, Pool #MA1157, 3.500%, 7/20/43 | 221,061 | ||||||
Total U.S. Government Mortgage-Backed Obligations | $ | 5,289,008 | ||||||
Asset-Backed Securities — 5.7% | ||||||||
265,000 | Apidos CLO XVIII (Cayman Islands), Ser 2018-18A, Class A1, 144a, (3M LIBOR +1.140%), 3.732%, 10/22/30(A) | 264,855 | ||||||
250,000 | Hertz Vehicle Financing II LP, Ser 2019-1A, Class A, 144a, 3.710%, 3/25/23 | 256,584 | ||||||
260,363 | Jimmy Johns Funding LLC, Ser 2017-1A, Class A2I, 144a, 3.610%, 7/30/47 | 262,935 | ||||||
245,625 | Jimmy Johns Funding LLC, Ser 2017-1A, Class A2II, 144a, 4.846%, 7/30/47 | 257,587 | ||||||
250,000 | Kabbage Funding LLC, Ser 2019-1, Class A, 144a, 3.825%, 3/15/24 | 253,525 | ||||||
275,000 | Madison Park Funding XXXV Ltd. (Cayman Islands), Ser 2019-35A, Class A2A, 144a, (3M LIBOR +1.650%), 4.174%, 4/20/31(A) | 274,988 | ||||||
139,895 | Sonic Capital LLC, Ser 2016-1A, Class A2, 144a, 4.472%, 5/20/46 | 142,025 | ||||||
325,000 | Towd Point Mortgage Trust, Ser 2015-3, Class A2, 144a, 4.000%, 3/25/54(A)(B) | 336,293 | ||||||
237,368 | Towd Point Mortgage Trust, Ser 2019-1, Class A1, 144a, 3.750%, 3/25/58(A)(B) | 247,878 | ||||||
380,000 | Voya CLO Ltd. (Cayman Islands), Ser 2017-4A, Class A1, 144a, (3M LIBOR +1.130%), 3.727%, 10/15/30(A) | 378,852 | ||||||
275,000 | Voya CLO Ltd. (Cayman Islands), Ser 2019-2A, Class A, 144a, (3M LIBOR +1.270%), 0.000%, 7/20/32(A) | 275,000 | ||||||
394,000 | Wendys Funding LLC, Ser 2018-1A, Class A2I, 144a, 3.573%, 3/15/48 | 396,262 | ||||||
Total Asset-Backed Securities | $ | 3,346,784 |
Shares | ||||||||
Exchange-Traded Fund — 4.9% | ||||||||
25,384 | iShares JP Morgan USD Emerging Markets Bond ETF | $ | 2,875,753 |
Principal | ||||||||
Amount | ||||||||
Non-Agency Collateralized Mortgage Obligations — 3.4% | ||||||||
$ | 253,052 | Agate Bay Mortgage Trust, Ser 2013-1, Class B3, 144a, 3.608%, 7/25/43(A)(B) | 254,216 | |||||
227,882 | CSMC Trust, Ser 2018-RPL9, Class A, 144a, 3.850%, 9/25/57(A)(B) | 235,542 | ||||||
3,063 | Deutsche ALT-A Securities, Inc. Alternate Loan Trust, Ser 2003-2XS, Class A6, 5.470%, 9/25/33(A)(B) | 3,105 |
8 |
Touchstone Active Bond Fund (Unaudited) (Continued)
Principal | Market | |||||||
Amount | Value | |||||||
Non-Agency Collateralized Mortgage Obligations — 3.4% (Continued) | ||||||||
$ | 414,044 | EverBank Mortgage Loan Trust, Ser 2013-1, Class B1, 144a, 3.498%, 3/25/43(A)(B) | $ | 420,459 | ||||
136,833 | PMT Loan Trust, Ser 2013-J1, Class A11, 144a, 3.500%, 9/25/43(A)(B) | 138,799 | ||||||
96,382 | Residential Asset Securitization Trust, Ser 2006-A1, Class 1A3, 6.000%, 4/25/36 | 70,384 | ||||||
253,570 | Sequoia Mortgage Trust, Ser 2013-1, Class B1, 3.647%, 2/25/43(A)(B) | 260,096 | ||||||
238,303 | Sequoia Mortgage Trust, Ser 2013-10, Class B2, 144a, 3.565%, 8/25/43(A)(B) | 244,076 | ||||||
329,743 | Sequoia Mortgage Trust, Ser 2013-5, Class B1, 144a, 3.509%, 5/25/43(A)(B) | 337,276 | ||||||
41,945 | Washington Mutual Alternative Mortgage Pass-Through Certificates, Ser 2005-9, Class 2A4, 5.500%, 11/25/35 | 41,794 | ||||||
Total Non-Agency Collateralized Mortgage Obligations | $ | 2,005,747 | ||||||
Agency Collateralized Mortgage Obligations — 2.3% | ||||||||
325,000 | FHLMC REMIC, Ser 4092, Class AY, 3.000%, 8/15/32 | 332,768 | ||||||
81,966 | FNMA REMIC, Ser 2015-51, Class KC, 3.000%, 6/25/45 | 84,101 | ||||||
228,000 | FNMA REMIC, Ser 2016-102, Class AY, 3.000%, 1/25/37 | 235,338 | ||||||
160,000 | FNMA REMIC, Ser 2017-83, Class DL, 3.000%, 10/25/37 | 165,468 | ||||||
507,251 | FNMA REMIC, Ser 2017-90, Class KA, 3.000%, 11/25/47 | 525,134 | ||||||
Total Agency Collateralized Mortgage Obligations | $ | 1,342,809 | ||||||
Commercial Mortgage-Backed Securities — 1.3% | ||||||||
360,000 | DBUBS Mortgage Trust, Ser 2017-BRBK, Class B, 144a, 3.648%, 10/10/34(A)(B) | 375,062 | ||||||
375,000 | GS Mortgage Securities Corp. II, Ser 2017-SLP, Class B, 144a, 3.772%, 10/10/32 | 386,161 | ||||||
Total Commercial Mortgage-Backed Securities | $ | 761,223 | ||||||
Municipal Bond — 0.6% | ||||||||
New York — 0.6% | ||||||||
320,000 | NY Housing Development Corp., Ref 8 Spruce Street Class B, 3.864%, 2/15/48 | $ | 334,298 | |||||
Sovereign Bonds — 0.4% | ||||||||
208,000 | Province of Ontario Canada, 1.875%, 5/21/20 | $ | 207,514 |
Market | ||||||||
Shares | Value | |||||||
Short-Term Investment Fund — 3.0% | ||||||||
1,742,300 | Dreyfus Government Cash Management, Institutional Shares, 2.25%∞Ω | $ | 1,742,300 | |||||
Total Investment Securities — 99.9% | ||||||||
(Cost $56,331,592) | $ | 58,146,422 | ||||||
Other Assets in Excess of Liabilities — 0.1% | 85,728 | |||||||
Net Assets — 100.0% | $ | 58,232,150 |
(A) | Variable rate security - Rate reflected is the rate in effect as of June 30, 2019. |
(B) | Certain variable rate securities are not based on a published reference rate and spread but are determined by the issuer or agent and are based on current market conditions. These securities do not indicate a reference rate and spread in their description. |
∞ | Open-End Fund. |
Ω | Represents the 7-day SEC yield as of June 30, 2019. |
Portfolio Abbreviations:
CLO - Collateralized Loan Obligation
DAC - Designated Activity Company
ETF - Exchange-Traded Fund
FHLMC - Federal Home Loan Mortgage Corporation
FNMA - Federal National Mortgage Association
GNMA - Government National Mortgage Association
LIBOR - London Interbank Offered Rate
LLC - Limited Liability Company
LP - Limited Partnership
MTN -Medium Term Note
PLC - Public Limited Company
REIT - Real Estate Investment Trust
REMIC - Real Estate Mortgage Investment Conduit
USD - United States Dollar
9 |
Touchstone Active Bond Fund (Unaudited) (Continued)
144a - This is a restricted security that was sold in a transaction qualifying for the exemption under Rule 144a of the Securities Act of 1933. This security may be sold in transactions exempt from registration, normally to qualified institutional buyers. At June 30, 2019, these securities were valued at $9,577,777 or 16.4% of net assets. These securities were deemed liquid pursuant to procedures approved by the Board of Trustees.
Other Information:
The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the security valuation section in the accompanying Notes to Financial Statements.
Valuation inputs at Reporting Date: | ||||||||||||||||
Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Assets: | ||||||||||||||||
Corporate Bonds | $ | — | $ | 20,996,361 | $ | — | $ | 20,996,361 | ||||||||
U.S. Treasury Obligations | — | 19,244,625 | — | 19,244,625 | ||||||||||||
U.S. Government Mortgage-Backed Obligations | — | 5,289,008 | — | 5,289,008 | ||||||||||||
Asset-Backed Securities | — | 3,346,784 | — | 3,346,784 | ||||||||||||
Exchange-Traded Fund | 2,875,753 | — | — | 2,875,753 | ||||||||||||
Non-Agency Collateralized Mortgage Obligations | — | 2,005,747 | — | 2,005,747 | ||||||||||||
Agency Collateralized Mortgage Obligations | — | 1,342,809 | — | 1,342,809 | ||||||||||||
Commercial Mortgage-Backed Securities | — | 761,223 | — | 761,223 | ||||||||||||
Municipal Bond | — | 334,298 | — | 334,298 | ||||||||||||
Sovereign Bond | — | 207,514 | — | 207,514 | ||||||||||||
Short-Term Investment Fund | 1,742,300 | — | — | 1,742,300 | ||||||||||||
Total Assets | $ | 4,618,053 | $ | 53,528,369 | $ | — | $ | 58,146,422 |
See accompanying Notes to Financial Statements.
10 |
Touchstone Balanced Fund – June 30, 2019 (Unaudited)
Market | ||||||||
Shares | Value | |||||||
Common Stocks — 62.4% | ||||||||
Information Technology — 14.0% | ||||||||
2,869 | Apple, Inc. | $ | 567,832 | |||||
4,292 | Avnet, Inc. | 194,299 | ||||||
1,250 | International Business Machines Corp. | 172,375 | ||||||
5,567 | Microsoft Corp. | 745,755 | ||||||
7,181 | Oracle Corp. | 409,102 | ||||||
2,731 | salesforce.com, Inc.* | 414,375 | ||||||
2,503,738 | ||||||||
Communication Services — 11.6% | ||||||||
458 | Alphabet, Inc. - Class C* | 495,057 | ||||||
6,447 | AT&T, Inc. | 216,039 | ||||||
594 | Charter Communications, Inc. - Class A* | 234,737 | ||||||
6,110 | Comcast Corp. - Class A | 258,331 | ||||||
2,486 | Facebook, Inc. - Class A* | 479,798 | ||||||
2,249 | Fox Corp. - Class A | 82,403 | ||||||
2,246 | Walt Disney Co. (The) | 313,631 | ||||||
2,079,996 | ||||||||
Financials — 10.7% | ||||||||
8,450 | Bank of America Corp. | 245,050 | ||||||
5,011 | Berkshire Hathaway, Inc. - Class B* | 1,068,195 | ||||||
4,283 | Brookfield Asset Management, Inc. (Canada) - Class A | 204,642 | ||||||
1,128 | Goldman Sachs Group, Inc. (The) | 230,789 | ||||||
1,435 | Signature Bank/NewYork NY | 173,405 | ||||||
1,922,081 | ||||||||
Consumer Discretionary — 8.3% | ||||||||
422 | Amazon.com, Inc.* | 799,112 | ||||||
90 | Booking Holdings, Inc.* | 168,724 | ||||||
3,744 | Carnival Corp. | 174,283 | ||||||
4,760 | JD.com, Inc. (China) ADR* | 144,180 | ||||||
4,257 | Yum China Holdings, Inc. (China) | 196,673 | ||||||
1,482,972 | ||||||||
Health Care — 6.9% | ||||||||
2,668 | AmerisourceBergen Corp. | 227,474 | ||||||
890 | Biogen, Inc.* | 208,144 | ||||||
4,994 | Bristol-Myers Squibb Co. | 226,478 | ||||||
2,248 | Johnson & Johnson | 313,101 | ||||||
2,973 | Novartis AG (Switzerland) ADR | 271,465 | ||||||
1,246,662 | ||||||||
Industrials — 3.8% | ||||||||
13,578 | General Electric Co. | 142,569 | ||||||
1,543 | Union Pacific Corp. | 260,937 | ||||||
2,069 | United Technologies Corp. | 269,384 | ||||||
672,890 | ||||||||
Real Estate — 2.6% | ||||||||
1,571 | Jones Lang LaSalle, Inc. REIT | 221,024 | ||||||
1,574 | Simon Property Group, Inc. REIT | 251,462 | ||||||
472,486 | ||||||||
Consumer Staples — 2.3% | ||||||||
2,761 | Monster Beverage Corp.* | 176,235 | ||||||
3,839 | Unilever NV (United Kingdom) | 233,104 | ||||||
409,339 | ||||||||
Energy — 2.2% | ||||||||
2,491 | Exxon Mobil Corp. | 190,885 | ||||||
3,229 | Halliburton Co. | 73,427 | ||||||
3,317 | Schlumberger Ltd. | 131,818 | ||||||
396,130 | ||||||||
Total Common Stocks | $ | 11,186,294 |
Principal | ||||||||
Amount | ||||||||
U.S. Treasury Obligations — 15.5% | ||||||||
$ | 235,000 | U.S. Treasury Bond, 3.000%, 2/15/49 | 258,096 | |||||
409,884 | U.S. Treasury Inflation Indexed Bonds, 0.875%, 1/15/29 | 431,428 | ||||||
18,000 | U.S. Treasury Note, 2.125%, 3/31/24 | 18,301 | ||||||
19,000 | U.S. Treasury Note, 2.125%, 5/31/26 | 19,318 | ||||||
520,000 | U.S. Treasury Note, 2.250%, 4/30/21 | 524,367 | ||||||
310,000 | U.S. Treasury Note, 2.500%, 5/31/20 | 311,368 | ||||||
803,000 | U.S. Treasury Note, 2.500%, 3/31/23 | 825,396 | ||||||
375,000 | U.S. Treasury Note, 2.625%, 2/15/29 | 395,449 | ||||||
Total U.S. Treasury Obligations | $ | 2,783,723 | ||||||
Corporate Bonds — 12.1% | ||||||||
Financials — 3.1% | ||||||||
21,000 | Allstate Corp. (The), Ser B, 5.750%, 8/15/53 | 22,012 | ||||||
24,000 | American Express Co., 3.000%, 10/30/24 | 24,602 | ||||||
50,000 | Bank of America Corp. MTN, 4.000%, 1/22/25 | 52,590 | ||||||
24,000 | Bank of Montreal (Canada), 3.803%, 12/15/32 | 24,339 | ||||||
24,000 | Bank of New York Mellon Corp. (The) MTN, 2.950%, 1/29/23 | 24,502 | ||||||
22,000 | BB&T Corp. MTN, 2.850%, 10/26/24 | 22,550 | ||||||
18,000 | Citigroup, Inc., 3.200%, 10/21/26 | 18,357 | ||||||
11,000 | Citigroup, Inc., 4.750%, 5/18/46 | 12,442 | ||||||
18,000 | Fifth Third Bancorp, 2.875%, 7/27/20 | 18,083 | ||||||
32,000 | Goldman Sachs Group, Inc. (The), 3.691%, 6/5/28 | 33,049 | ||||||
20,000 | Goldman Sachs Group, Inc. (The), (3M LIBOR +1.000%), 3.581%, 7/24/23(A) | 20,034 | ||||||
32,000 | Huntington Bancshares, Inc./OH, 4.000%, 5/15/25 | 34,141 | ||||||
15,000 | JPMorgan Chase & Co., 3.250%, 9/23/22 | 15,410 | ||||||
10,000 | JPMorgan Chase & Co., (3M LIBOR +0.730%), 3.322%, 4/23/24(A) | 9,973 | ||||||
25,000 | JPMorgan Chase & Co., 3.509%, 1/23/29 | 25,991 | ||||||
25,000 | Morgan Stanley, 3.950%, 4/23/27 | 26,149 | ||||||
25,000 | New York Life Global Funding, 144a, 3.000%, 1/10/28 | 25,567 |
11 |
Touchstone Balanced Fund (Unaudited) (Continued)
Principal | Market | |||||||
Amount | Value | |||||||
Corporate Bonds — 12.1% (Continued) | ||||||||
Financials — (Continued) | ||||||||
$ | 18,000 | Northwestern Mutual Life Insurance Co. (The), 144a, 3.850%, 9/30/47 | $ | 18,582 | ||||
21,000 | PNC Capital Trust C, (3M LIBOR +0.570%), 3.090%, 6/1/28(A) | 18,918 | ||||||
20,000 | SunTrust Banks, Inc., 4.000%, 5/1/25 | 21,416 | ||||||
32,000 | SunTrust Capital I, Ser A, (3M LIBOR +0.670%), 3.190%, 5/15/27(A) | 29,360 | ||||||
17,000 | Visa, Inc., 4.150%, 12/14/35 | 19,537 | ||||||
30,000 | Wells Fargo & Co., 4.125%, 8/15/23 | 31,683 | ||||||
549,287 | ||||||||
Energy — 1.4% | ||||||||
23,000 | Boardwalk Pipelines LP, 4.450%, 7/15/27 | 23,518 | ||||||
18,000 | Buckeye Partners LP, 3.950%, 12/1/26 | 15,952 | ||||||
14,000 | Canadian Natural Resources Ltd. (Canada), 6.250%, 3/15/38 | 17,286 | ||||||
17,000 | Cenovus Energy, Inc. (Canada), 4.250%, 4/15/27 | 17,610 | ||||||
16,000 | Columbia Pipeline Group, Inc., 4.500%, 6/1/25 | 17,219 | ||||||
21,000 | Energy Transfer Partners LP, 4.950%, 6/15/28 | 22,960 | ||||||
23,000 | Midcontinent Express Pipeline LLC, 144a, 6.700%, 9/15/19 | 23,107 | ||||||
20,000 | NGPL PipeCo LLC, 144a, 7.768%, 12/15/37 | 25,400 | ||||||
17,000 | Petroleos Mexicanos (Mexico), 4.500%, 1/23/26 | 15,609 | ||||||
15,000 | Petroleos Mexicanos (Mexico), 6.350%, 2/12/48 | 12,878 | ||||||
20,000 | Sabine Pass Liquefaction LLC, 5.000%, 3/15/27 | 21,929 | ||||||
20,000 | Shell International Finance BV (Netherlands), 1.875%, 5/10/21 | 19,911 | ||||||
17,000 | Woodside Finance Ltd. (Australia), 144a, 4.500%, 3/4/29 | 17,964 | ||||||
251,343 | ||||||||
Information Technology — 1.1% | ||||||||
75,000 | Apple, Inc., 2.750%, 1/13/25 | 76,674 | ||||||
24,000 | Apple, Inc., 4.650%, 2/23/46 | 28,466 | ||||||
22,000 | Broadcom, Inc., 144a, 3.125%, 4/15/21 | 22,142 | ||||||
20,000 | International Business Machines Corp., 2.800%, 5/13/21 | 20,241 | ||||||
11,000 | Microsoft Corp., 3.500%, 2/12/35 | 11,737 | ||||||
20,000 | NXP BV / NXP Funding LLC (Netherlands), 144a, 5.350%, 3/1/26 | 22,148 | ||||||
20,000 | Oracle Corp., 2.650%, 7/15/26 | 20,091 | ||||||
201,499 | ||||||||
Communication Services — 1.1% | ||||||||
19,000 | Activision Blizzard, Inc., 4.500%, 6/15/47 | 19,681 | ||||||
20,000 | AT&T, Inc., 4.350%, 6/15/45 | 19,994 | ||||||
10,000 | AT&T, Inc., 4.500%, 5/15/35 | 10,468 | ||||||
24,000 | Booking Holdings, Inc., 3.600%, 6/1/26 | 25,307 | ||||||
16,000 | Charter Communications Operating LLC / Charter Communications Operating Capital, 6.484%, 10/23/45 | 18,853 | ||||||
14,000 | Comcast Corp., 4.000%, 3/1/48 | 14,809 | ||||||
15,000 | Comcast Corp., 4.150%, 10/15/28 | 16,532 | ||||||
14,000 | Cox Communications, Inc., 144a, 3.350%, 9/15/26 | 14,137 | ||||||
8,000 | Deutsche Telekom International Finance BV (Netherlands), 8.750%, 6/15/30 | 11,520 | ||||||
25,000 | Verizon Communications, Inc., 5.012%, 4/15/49 | 29,775 | ||||||
15,000 | Warner Media LLC, 3.800%, 2/15/27 | 14,990 | ||||||
196,066 | ||||||||
Industrials — 1.1% | ||||||||
20,000 | Avolon Holdings Funding Ltd. (Cayman Islands), 144a, 3.625%, 5/1/22 | 20,272 | ||||||
25,000 | Burlington Northern Santa Fe LLC, 5.750%, 5/1/40 | 32,952 | ||||||
23,000 | Eagle Materials, Inc., 4.500%, 8/1/26 | 23,487 | ||||||
12,000 | Embraer Netherlands Finance BV (Netherlands), 5.050%, 6/15/25 | 12,945 | ||||||
7,000 | Embraer Netherlands Finance BV (Netherlands), 5.400%, 2/1/27 | 7,763 | ||||||
21,000 | FedEx Corp., 5.100%, 1/15/44 | 23,104 | ||||||
12,000 | General Electric Co., 4.125%, 10/9/42 | 11,052 | ||||||
14,000 | Norfolk Southern Corp., 4.837%, 10/1/41 | 16,212 | ||||||
20,000 | Parker-Hannifin Corp., 4.000%, 6/14/49 | 21,162 | ||||||
25,000 | Wabtec Corp., 4.950%, 9/15/28 | 26,805 | ||||||
195,754 | ||||||||
Health Care — 1.0% | ||||||||
7,000 | Abbott Laboratories, 3.750%, 11/30/26 | 7,568 | ||||||
20,000 | AbbVie, Inc., 4.450%, 5/14/46 | 19,642 | ||||||
15,000 | Allergan Funding SCS (Luxembourg), 3.800%, 3/15/25 | 15,567 | ||||||
18,000 | Allergan Sales LLC, 144a, 5.000%, 12/15/21 | 18,823 | ||||||
17,000 | Celgene Corp., 5.000%, 8/15/45 | 20,175 | ||||||
16,000 | Cigna Corp., 144a, 4.375%, 10/15/28 | 17,262 | ||||||
23,000 | CVS Health Corp., 4.300%, 3/25/28 | 24,253 | ||||||
13,000 | CVS Health Corp., 5.125%, 7/20/45 | 13,863 | ||||||
17,000 | Express Scripts Holding Co., 3.300%, 2/25/21 | 17,226 | ||||||
30,000 | Johnson & Johnson, 2.900%, 1/15/28 | 30,847 | ||||||
185,226 | ||||||||
Real Estate — 0.9% | ||||||||
24,000 | Boston Properties LP REIT, 3.200%, 1/15/25 | 24,500 |
12 |
Touchstone Balanced Fund (Unaudited) (Continued)
Principal | Market | |||||||
Amount | Value | |||||||
Corporate Bonds — 12.1% (Continued) | ||||||||
Real Estate — (Continued) | ||||||||
$ | 22,000 | Crown Castle International Corp. REIT, 3.650%, 9/1/27 | $ | 22,655 | ||||
15,000 | Mid-America Apartments LP REIT, 3.750%, 6/15/24 | 15,611 | ||||||
17,000 | Sabra Health Care LP REIT, 5.125%, 8/15/26 | 17,696 | ||||||
25,000 | SL Green Operating Partnership LP REIT, 3.250%, 10/15/22 | 25,334 | ||||||
14,000 | Spirit Realty LP REIT, 4.450%, 9/15/26 | 14,659 | ||||||
27,000 | VEREIT Operating Partnership LP REIT, 4.600%, 2/6/24 | 28,670 | ||||||
16,000 | Welltower, Inc. REIT, 4.250%, 4/1/26 | 17,051 | ||||||
166,176 | ||||||||
Consumer Discretionary — 0.9% | ||||||||
20,000 | AutoNation, Inc., 5.500%, 2/1/20 | 20,290 | ||||||
22,000 | Dollar General Corp., 3.250%, 4/15/23 | 22,598 | ||||||
19,000 | Ford Motor Credit Co. LLC, 5.584%, 3/18/24 | 20,394 | ||||||
32,000 | General Motors Financial Co., Inc., 3.950%, 4/13/24 | 32,693 | ||||||
9,000 | General Motors Financial Co., Inc., 4.350%, 4/9/25 | 9,284 | ||||||
20,000 | Home Depot, Inc. (The), 5.950%, 4/1/41 | 27,115 | ||||||
22,000 | Walmart, Inc., 2.850%, 7/8/24 | 22,729 | ||||||
155,103 | ||||||||
Utilities — 0.7% | ||||||||
5,000 | American Water Capital Corp., 6.593%, 10/15/37 | 6,839 | ||||||
15,000 | Duke Energy Progress LLC, 4.150%, 12/1/44 | 16,236 | ||||||
11,000 | Fortis, Inc. (Canada), 3.055%, 10/4/26 | 10,919 | ||||||
16,000 | NextEra Energy Capital Holdings, Inc., 5.650%, 5/1/79 | 16,504 | ||||||
16,000 | Oncor Electric Delivery Co. LLC, 3.800%, 9/30/47 | 16,736 | ||||||
27,000 | PacifiCorp., 5.750%, 4/1/37 | 34,558 | ||||||
25,000 | WEC Energy Group, Inc., (3M LIBOR+2.113%), 4.631%, 5/15/67(A) | 20,626 | ||||||
122,418 | ||||||||
Consumer Staples — 0.7% | ||||||||
26,000 | Anheuser-Busch Cos LLC / Anheuser-Busch InBev Worldwide, Inc., 4.900%, 2/1/46 | 28,949 | ||||||
19,000 | Kraft Heinz Foods Co., 6.875%, 1/26/39 | 22,818 | ||||||
16,000 | Kroger Co. (The), 5.000%, 4/15/42 | 16,665 | ||||||
22,000 | Mars, Inc., 144a, 3.875%, 4/1/39 | 23,295 | ||||||
6,000 | Moody's Corp., 2.750%, 12/15/21 | 6,053 | ||||||
20,000 | Reynolds American, Inc., 4.450%, 6/12/25 | 21,208 | ||||||
118,988 | ||||||||
Materials — 0.1% | ||||||||
19,000 | Sherwin-Williams Co. (The), 4.500%, 6/1/47 | $ | 20,265 | |||||
Total Corporate Bonds | $ | 2,162,125 | ||||||
U.S. Government Mortgage-Backed Obligations — 6.7% | ||||||||
256,827 | FHLMC, Pool #G05624, 4.500%, 9/1/39 | 275,962 | ||||||
167,347 | FHLMC, Pool #Q29260, 4.000%, 10/1/44 | 175,301 | ||||||
98,487 | FNMA, Pool #725423, 5.500%, 5/1/34 | 109,393 | ||||||
95,760 | FNMA, Pool #725610, 5.500%, 7/1/34 | 106,366 | ||||||
24,631 | FNMA, Pool #890310, 4.500%, 12/1/40 | 26,455 | ||||||
100,361 | FNMA, Pool #AD9193, 5.000%, 9/1/40 | 109,065 | ||||||
387,337 | FNMA, Pool #AL5718, 3.500%, 9/1/44 | 403,343 | ||||||
Total U.S. Government Mortgage-Backed Obligations | $ | 1,205,885 |
Shares | ||||||||
Exchange-Traded Fund — 1.8% | ||||||||
2,738 | iShares JP Morgan USD Emerging Markets Bond ETF | $ | 310,188 |
Principal | ||||||||
Amount | ||||||||
Sovereign Bonds — 0.1% | ||||||||
$ | 22,000 | Province of Ontario Canada, 1.875%, 5/21/20 | $ | 21,949 |
Shares | ||||||||
Short-Term Investment Fund — 1.2% | ||||||||
219,039 | Dreyfus Government Cash Management, Institutional Shares, 2.25%∞Ω | $ | 219,039 | |||||
Total Investment Securities — 99.8% | ||||||||
(Cost $15,469,996) | $ | 17,889,203 | ||||||
Other Assets in Excess of Liabilities — 0.2% | 42,899 | |||||||
Net Assets — 100.0% | $ | 17,932,102 |
(A) | Variable rate security - Rate reflected is the rate in effect as of June 30, 2019. |
* | Non-income producing security. |
∞ | Open-End Fund. |
Ω | Represents the 7-day SEC yield as of June 30, 2019. |
13 |
Touchstone Balanced Fund(Unaudited)(Continued)
Portfolio Abbreviations:
ADR - American Depositary Receipt
ETF - Exchange-Traded Fund
FHLMC - Federal Home Loan Mortgage Corporation
FNMA - Federal National Mortgage Association
LIBOR - London Interbank Offered Rate
LLC - Limited Liability Company
LP - Limited Partnership
MTN - Medium Term Note
REIT - Real Estate Investment Trust
USD - United States Dollar
144a - This is a restricted security that was sold in a transaction qualifying for the exemption under Rule 144a of the Securities Act of 1933. This security may be sold in transactions exempt from registration, normally to qualified institutional buyers. At June 30, 2019, these securities were valued at $248,699 or 1.4% of net assets. These securities were deemed liquid pursuant to procedures approved by the Board of Trustees.
Other Information:
The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the security valuation section in the accompanying Notes to Financial Statements.
Valuation inputs at Reporting Date: | ||||||||||||||||
Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Assets: | ||||||||||||||||
Common Stocks | $ | 11,186,294 | $ | — | $ | — | $ | 11,186,294 | ||||||||
U.S. Treasury Obligations | — | 2,783,723 | — | 2,783,723 | ||||||||||||
Corporate Bonds | — | 2,162,125 | — | 2,162,125 | ||||||||||||
U.S. Government Mortgage-Backed Obligations | — | 1,205,885 | — | 1,205,885 | ||||||||||||
Exchange-Traded Fund | 310,188 | — | — | 310,188 | ||||||||||||
Sovereign Bonds | — | 21,949 | — | 21,949 | ||||||||||||
Short-Term Investment Fund | 219,039 | — | — | 219,039 | ||||||||||||
Total | $ | 11,715,521 | $ | 6,173,682 | $ | — | $ | 17,889,203 |
See accompanying Notes to Financial Statements.
14 |
Touchstone Bond Fund –June 30, 2019 (Unaudited)
Principal | Market | |||||||
Amount | Value | |||||||
U.S. Treasury Obligations — 29.4% | ||||||||
$ | 1,700,000 | U.S. Treasury Bond, 3.000%, 2/15/49 | $ | 1,867,078 | ||||
2,231,592 | U.S. Treasury Inflation Indexed Bonds, 0.875%, 1/15/29 | 2,348,887 | ||||||
140,000 | U.S. Treasury Note, 2.125%, 3/31/24 | 142,341 | ||||||
144,000 | U.S. Treasury Note, 2.125%, 5/31/26 | 146,408 | ||||||
2,517,000 | U.S. Treasury Note, 2.250%, 4/30/21 | 2,538,139 | ||||||
58,000 | U.S. Treasury Note, 2.375%, 5/15/29 | 59,937 | ||||||
2,923,000 | U.S. Treasury Note, 2.500%, 3/31/23 | 3,004,524 | ||||||
1,510,000 | U.S. Treasury Note, 2.625%, 2/15/29 | 1,592,342 | ||||||
Total U.S. Treasury Obligations | $ | 11,699,656 | ||||||
Corporate Bonds — 28.9% | ||||||||
Financials — 7.9% | ||||||||
123,000 | Allstate Corp. (The), Ser B, 5.750%, 8/15/53 | 128,930 | ||||||
124,000 | American Express Co., 3.000%, 10/30/24 | 127,109 | ||||||
100,000 | Bank of America Corp., 3.705%, 4/24/28 | 105,070 | ||||||
145,000 | Bank of America Corp. MTN, 4.000%, 1/22/25 | 152,512 | ||||||
114,000 | Bank of Montreal (Canada), 3.803%, 12/15/32 | 115,609 | ||||||
124,000 | Bank of New York Mellon Corp. (The) MTN, 2.950%, 1/29/23 | 126,596 | ||||||
116,000 | Barclays PLC (United Kingdom), 4.610%, 2/15/23 | 120,023 | ||||||
94,000 | Citigroup, Inc., 3.200%, 10/21/26 | 95,865 | ||||||
54,000 | Citigroup, Inc., 4.750%, 5/18/46 | 61,077 | ||||||
142,000 | Fifth Third Bancorp, 2.875%, 7/27/20 | 142,652 | ||||||
60,000 | GE Capital International Funding Co. Unlimited Co. (Ireland), 4.418%, 11/15/35 | 59,385 | ||||||
118,000 | Goldman Sachs Group, Inc. (The), (3M LIBOR +1.000%), 3.581%, 7/24/23(A) | 118,201 | ||||||
67,000 | Goldman Sachs Group, Inc. (The), 3.691%, 6/5/28 | 69,195 | ||||||
147,000 | Goldman Sachs Group, Inc. (The), 5.250%, 7/27/21 | 155,372 | ||||||
121,000 | Huntington Bancshares, Inc./OH, 4.000%, 5/15/25 | 129,094 | ||||||
74,000 | JPMorgan Chase & Co., 3.250%, 9/23/22 | 76,022 | ||||||
95,000 | JPMorgan Chase & Co., (3M LIBOR +0.730%), 3.322%, 4/23/24(A) | 94,747 | ||||||
122,000 | JPMorgan Chase & Co., 3.509%, 1/23/29 | 126,836 | ||||||
118,000 | Lloyds Banking Group PLC (United Kingdom), 3.574%, 11/7/28 | 118,121 | ||||||
133,000 | Morgan Stanley, 3.950%, 4/23/27 | 139,115 | ||||||
126,000 | New York Life Global Funding, 144a, 3.000%, 1/10/28 | 128,859 | ||||||
80,000 | Northwestern Mutual Life Insurance Co. (The), 144a, 3.850%, 9/30/47 | 82,586 | ||||||
120,000 | PNC Capital Trust C, (3M LIBOR +0.570%), 3.090%, 6/1/28(A) | 108,106 | ||||||
112,000 | SunTrust Banks, Inc., 4.000%, 5/1/25 | 119,927 | ||||||
187,000 | SunTrust Capital I, Ser A, (3M LIBOR +0.670%), 3.190%, 5/15/27(A) | 171,573 | ||||||
80,000 | Visa, Inc., 4.150%, 12/14/35 | 91,938 | ||||||
117,000 | Wells Fargo & Co., 2.100%, 7/26/21 | 116,366 | ||||||
73,000 | Wells Fargo & Co., 4.125%, 8/15/23 | 77,095 | ||||||
3,157,981 | ||||||||
Industrials — 3.0% | ||||||||
122,000 | Avolon Holdings Funding Ltd. (Cayman Islands), 144a, 3.625%, 5/1/22 | 123,659 | ||||||
130,000 | CRH America Finance, Inc., 144a, 4.500%, 4/4/48 | 128,202 | ||||||
174,000 | Eagle Materials, Inc., 4.500%, 8/1/26 | 177,681 | ||||||
47,000 | Embraer Netherlands Finance BV (Netherlands), 5.050%, 6/15/25 | 50,702 | ||||||
47,000 | Embraer Netherlands Finance BV (Netherlands), 5.400%, 2/1/27 | 52,123 | ||||||
114,000 | FedEx Corp., 5.100%, 1/15/44 | 125,422 | ||||||
76,000 | Norfolk Southern Corp., 4.837%, 10/1/41 | 88,009 | ||||||
121,000 | Parker-Hannifin Corp., 4.000%, 6/14/49 | 128,029 | ||||||
119,000 | Roper Technologies, Inc., 3.000%, 12/15/20 | 119,860 | ||||||
88,000 | Vulcan Materials Co., 4.500%, 4/1/25 | 93,808 | ||||||
109,000 | Wabtec Corp., 4.950%, 9/15/28 | 116,872 | ||||||
1,204,367 | ||||||||
Energy — 2.9% | ||||||||
123,000 | Boardwalk Pipelines LP, 4.450%, 7/15/27 | 125,768 | ||||||
128,000 | Buckeye Partners LP, 3.950%, 12/1/26 | 113,438 | ||||||
79,000 | Canadian Natural Resources Ltd. (Canada), 6.250%, 3/15/38 | 97,542 | ||||||
143,000 | Cenovus Energy, Inc. (Canada), 4.250%, 4/15/27 | 148,130 | ||||||
101,000 | Cheniere Corpus Christi Holdings LLC, 7.000%, 6/30/24 | 116,160 | ||||||
89,000 | Columbia Pipeline Group, Inc., 4.500%, 6/1/25 | 95,783 | ||||||
113,000 | Energy Transfer Partners LP, 4.950%, 6/15/28 | 123,545 | ||||||
86,000 | Petroleos Mexicanos (Mexico), 4.500%, 1/23/26 | 78,964 | ||||||
166,000 | Shell International Finance BV (Netherlands), 1.875%, 5/10/21 | 165,265 | ||||||
90,000 | Woodside Finance Ltd. (Australia), 144a, 4.500%, 3/4/29 | 95,102 | ||||||
1,159,697 | ||||||||
Consumer Staples — 2.5% | ||||||||
135,000 | Anheuser-Busch Cos LLC / Anheuser-Busch InBev Worldwide, Inc., 4.900%, 2/1/46 | 150,313 | ||||||
111,000 | Grupo Bimbo SAB de CV (Mexico), 144a, 4.500%, 1/25/22 | 114,847 |
15 |
Touchstone Bond Fund (Unaudited) (Continued)
Principal | Market | |||||||
Amount | Value | |||||||
Corporate Bonds — 28.9% (Continued) | ||||||||
Consumer Staples — (Continued) | ||||||||
$ | 130,000 | Imperial Brands Finance PLC (United Kingdom), 144a, 4.250%, 7/21/25 | $ | 136,418 | ||||
104,000 | Kraft Heinz Foods Co., 6.875%, 1/26/39 | 124,898 | ||||||
97,000 | Kroger Co. (The), 5.000%, 4/15/42 | 101,032 | ||||||
117,000 | Mars, Inc., 144a, 3.875%, 4/1/39 | 123,889 | ||||||
155,000 | Moody's Corp., 2.750%, 12/15/21 | 156,360 | ||||||
94,000 | Reynolds American, Inc., 4.450%, 6/12/25 | 99,678 | ||||||
1,007,435 | ||||||||
Health Care — 2.5% | ||||||||
102,000 | AbbVie, Inc., 4.450%, 5/14/46 | 100,173 | ||||||
73,000 | Allergan Funding SCS (Luxembourg), 3.800%, 3/15/25 | 75,757 | ||||||
84,000 | Allergan Sales LLC, 144a, 5.000%, 12/15/21 | 87,841 | ||||||
81,000 | Celgene Corp., 5.000%, 8/15/45 | 96,129 | ||||||
85,000 | Cigna Corp., 144a, 4.375%, 10/15/28 | 91,704 | ||||||
120,000 | CVS Health Corp., 4.300%, 3/25/28 | 126,537 | ||||||
61,000 | CVS Health Corp., 5.125%, 7/20/45 | 65,051 | ||||||
136,000 | Express Scripts Holding Co., 3.300%, 2/25/21 | 137,806 | ||||||
39,000 | Medtronic Global Holdings SCA (Luxembourg), 3.350%, 4/1/27 | 41,443 | ||||||
169,000 | Shire Acquisitions Investments Ireland DAC (Ireland), 2.400%, 9/23/21 | 168,792 | ||||||
991,233 | ||||||||
Real Estate — 2.5% | ||||||||
112,000 | Boston Properties LP REIT, 3.200%, 1/15/25 | 114,333 | ||||||
115,000 | Crown Castle International Corp. REIT, 3.650%, 9/1/27 | 118,426 | ||||||
120,000 | Mid-America Apartments LP REIT, 3.750%, 6/15/24 | 124,890 | ||||||
89,000 | Sabra Health Care LP REIT, 5.125%, 8/15/26 | 92,645 | ||||||
186,000 | SL Green Operating Partnership LP REIT, 3.250%, 10/15/22 | 188,483 | ||||||
101,000 | Spirit Realty LP REIT, 4.450%, 9/15/26 | 105,757 | ||||||
139,000 | VEREIT Operating Partnership LP REIT, 4.600%, 2/6/24 | 147,599 | ||||||
86,000 | Welltower, Inc. REIT, 4.250%, 4/1/26 | 91,650 | ||||||
983,783 | ||||||||
Communication Services — 2.4% | ||||||||
102,000 | Activision Blizzard, Inc., 4.500%, 6/15/47 | 105,658 | ||||||
37,000 | AT&T, Inc., 4.350%, 6/15/45 | 36,988 | ||||||
77,000 | AT&T, Inc., 4.500%, 5/15/35 | 80,604 | ||||||
80,000 | Charter Communications Operating LLC / Charter Communications Operating Capital, 6.484%, 10/23/45 | 94,265 | ||||||
65,000 | Comcast Corp., 4.000%, 3/1/48 | 68,758 | ||||||
83,000 | Comcast Corp., 4.150%, 10/15/28 | 91,478 | ||||||
81,000 | Cox Communications, Inc., 144a, 3.350%, 9/15/26 | 81,793 | ||||||
43,000 | Deutsche Telekom International Finance BV (Netherlands), 8.750%, 6/15/30 | 61,919 | ||||||
79,000 | Verizon Communications, Inc., 5.012%, 4/15/49 | 94,088 | ||||||
260,000 | Warner Media LLC, 3.800%, 2/15/27 | 259,827 | ||||||
975,378 | ||||||||
Information Technology — 1.6% | ||||||||
100,000 | Apple, Inc., 2.750%, 1/13/25 | 102,232 | ||||||
80,000 | Apple, Inc., 4.650%, 2/23/46 | 94,887 | ||||||
150,000 | Broadcom, Inc., 144a, 3.125%, 4/15/21 | 150,971 | ||||||
109,000 | International Business Machines Corp., 2.800%, 5/13/21 | 110,312 | ||||||
59,000 | Microsoft Corp., 3.500%, 2/12/35 | 62,953 | ||||||
109,000 | NXP BV / NXP Funding LLC (Netherlands), 144a, 5.350%, 3/1/26 | 120,708 | ||||||
642,063 | ||||||||
Consumer Discretionary — 1.6% | ||||||||
116,000 | Dollar General Corp., 3.250%, 4/15/23 | 119,156 | ||||||
107,000 | Ford Motor Credit Co. LLC, 5.584%, 3/18/24 | 114,851 | ||||||
90,000 | General Motors Financial Co., Inc., 3.950%, 4/13/24 | 91,950 | ||||||
76,000 | General Motors Financial Co., Inc., 4.350%, 4/9/25 | 78,400 | ||||||
71,000 | Home Depot, Inc. (The), 5.950%, 4/1/41 | 96,258 | ||||||
116,000 | Walmart, Inc., 2.850%, 7/8/24 | 119,846 | ||||||
620,461 | ||||||||
Utilities — 1.5% | ||||||||
38,000 | American Water Capital Corp., 6.593%, 10/15/37 | 51,976 | ||||||
54,000 | DTE Energy Co., Series D, 3.700%, 8/1/23 | 56,347 | ||||||
91,000 | Duke Energy Progress LLC, 4.150%, 12/1/44 | 98,498 | ||||||
85,000 | Fortis, Inc. (Canada), 3.055%, 10/4/26 | 84,375 | ||||||
89,000 | NextEra Energy Capital Holdings, Inc., 5.650%, 5/1/79 | 91,802 | ||||||
84,000 | Oncor Electric Delivery Co. LLC, 3.800%, 9/30/47 | 87,846 | ||||||
131,000 | WEC Energy Group, Inc., (3M LIBOR +2.113%), 4.631%, 5/15/67(A) | 108,075 | ||||||
578,919 | ||||||||
Materials — 0.5% | ||||||||
83,000 | Braskem America Finance Co., 144a, 7.125%, 7/22/41 | 97,832 | ||||||
101,000 | Sherwin-Williams Co. (The), 4.500%, 6/1/47 | 107,726 | ||||||
205,558 | ||||||||
Total Corporate Bonds | $ | 11,526,875 |
16 |
Touchstone Bond Fund (Unaudited) (Continued)
Principal | Market | |||||||
Amount | Value | |||||||
U.S. Government Mortgage-Backed Obligations — 20.6% | ||||||||
$ | 481,551 | FHLMC, Pool #G05624, 4.500%, 9/1/39 | $ | 517,429 | ||||
631,926 | FHLMC, Pool #Q29056, 4.000%, 10/1/44 | 661,573 | ||||||
274,263 | FHLMC, Pool #Q29260, 4.000%, 10/1/44 | 287,298 | ||||||
370,624 | FNMA, Pool #725423, 5.500%, 5/1/34 | 411,662 | ||||||
354,668 | FNMA, Pool #725610, 5.500%, 7/1/34 | 393,948 | ||||||
334,537 | FNMA, Pool #AD9193, 5.000%, 9/1/40 | 363,550 | ||||||
479,835 | FNMA, Pool #AL5718, 3.500%, 9/1/44 | 499,664 | ||||||
475,741 | FNMA, Pool #AR9195, 3.000%, 3/1/43 | 485,105 | ||||||
583,538 | FNMA, Pool #AS4707, 3.500%, 4/1/45 | 605,419 | ||||||
716,355 | FNMA, Pool #AS7234, 3.000%, 5/1/46 | 725,893 | ||||||
1,220,736 | FNMA, Pool #AS8703, 2.500%, 2/1/32 | 1,230,542 | ||||||
523,699 | FNMA, Pool #AT2016, 3.000%, 4/1/43 | 532,722 | ||||||
191,909 | FNMA, Pool #AZ7347, 3.000%, 11/1/45 | 194,660 | ||||||
649,457 | FNMA, Pool #BC1158, 3.500%, 2/1/46 | 669,841 | ||||||
550,259 | GNMA, Pool #5175, 4.500%, 9/20/41 | 587,083 | ||||||
22,910 | GNMA, Pool #679437, 6.000%, 11/15/22 | 22,998 | ||||||
Total U.S. Government Mortgage-Backed Obligations | $ | 8,189,387 |
Shares | ||||||||
Exchange-Traded Fund — 5.7% | ||||||||
20,047 | iShares JP Morgan USD Emerging Markets Bond ETF | $ | 2,271,125 |
Principal | ||||||||
Amount | ||||||||
Non-Agency Collateralized Mortgage Obligations — 4.7% | ||||||||
$ | 511,113 | Agate Bay Mortgage Trust, Ser 2015-7, Class B1, 144a, 3.764%, 10/25/45(A)(B) | 531,470 | |||||
510,478 | CSMC Trust, Ser 2015-1, Class B3, 144a, 3.942%, 1/25/45(A)(B) | 515,247 | ||||||
343,894 | CSMC Trust, Ser 2015-WIN1, Class B3, 144a, 3.862%, 12/25/44(A)(B) | 352,350 | ||||||
480,115 | PMT Loan Trust, Ser 2013-J1, Class A11, 144a, 3.500%, 9/25/43(A)(B) | 487,015 | ||||||
Total Non-Agency Collateralized Mortgage Obligations | $ | 1,886,082 | ||||||
Asset-Backed Securities — 4.7% | ||||||||
550,000 | Hertz Vehicle Financing II LP, Ser 2016-4A, Class A, 144a, 2.650%, 7/25/22 | 550,268 | ||||||
300,000 | Jack In The Box Funding LLC, Ser 2019-1A, Class A2I, 144a, 3.982%, 8/25/49 | 300,000 | ||||||
250,000 | Kabbage Funding LLC, Ser 2019-1, Class A, 144a, 3.825%, 3/15/24 | 253,525 | ||||||
237,368 | Towd Point Mortgage Trust, Ser 2019-1, Class A1, 144a, 3.750%, 3/25/58(A)(B) | 247,878 | ||||||
517,125 | Wendys Funding LLC, Ser 2018-1A, Class A2I, 144a, 3.573%, 3/15/48 | 520,093 | ||||||
Total Asset-Backed Securities | $ | 1,871,764 | ||||||
Agency Collateralized Mortgage Obligation — 3.0% | ||||||||
1,093,972 | FHLMC REMIC, Ser 3859 Class JB, 5.000%, 5/15/41 | $ | 1,201,444 | |||||
Commercial Mortgage-Backed Security — 0.7% | ||||||||
250,000 | GS Mortgage Securities Trust, Ser 2017-FARM, Class B, 144a, 3.659%, 1/10/43(A)(B) | $ | 257,663 | |||||
Sovereign Bond — 0.4% | ||||||||
166,000 | Province of Ontario Canada, 1.875%, 5/21/20 | $ | 165,612 |
Shares | ||||||||
Short-Term Investment Fund — 1.3% | ||||||||
534,871 | Dreyfus Government Cash Management, Institutional Shares, 2.25%∞Ω | $ | 534,871 | |||||
Total Investment Securities —99.4% | ||||||||
(Cost $38,841,259) | $ | 39,604,479 | ||||||
Other Assets in | ||||||||
Excess of Liabilities — 0.6% | 237,493 | |||||||
Net Assets — 100.0% | $ | 39,841,972 |
(A) | Variable rate security - Rate reflected is the rate in effect as of June 30, 2019. |
(B) | Certain variable rate securities are not based on a published reference rate and spread but are determined by the issuer or agent and are based on current market conditions. These securities do not indicate a reference rate and spread in their description. |
∞ | Open-End Fund. |
Ω | Represents the 7-day SEC yield as of June 30, 2019. |
17 |
Touchstone Bond Fund (Unaudited) (Continued)
Portfolio Abbreviations:
DAC - Designated Activity Company
ETF - Exchange-Traded Fund
FHLMC - Federal Home Loan Mortgage Corporation
FNMA - Federal National Mortgage Association
GNMA - Government National Mortgage Association
LIBOR - London Interbank Offered Rate
LLC - Limited Liability Company
LP - Limited Partnership
MTN - Medium Term Note
PLC - Public Limited Company
REIT - Real Estate Investment Trust
REMIC - Real Estate Mortgage Investment Conduit
USD - United States Dollar
144a - This is a restricted security that was sold in a transaction qualifying for the exemption under Rule 144a of the Securities Act of 1933. This security may be sold in transactions exempt from registration, normally to qualified institutional buyers. At June 30, 2019, these securities were valued at $5,579,920 or 14.0% of net assets. These securities were deemed liquid pursuant to procedures approved by the Board of Trustees.
Other Information:
The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the security valuation section in the accompanying Notes to Financial Statements.
Valuation inputs at Reporting Date: | ||||||||||||||||
Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Assets: | ||||||||||||||||
U.S. Treasury Obligations | $ | — | $ | 11,699,656 | $ | — | $ | 11,699,656 | ||||||||
Corporate Bonds | — | 11,526,875 | — | 11,526,875 | ||||||||||||
U.S. Government Mortgage-Backed Obligations | — | 8,189,387 | — | 8,189,387 | ||||||||||||
Exchange-Traded Fund | 2,271,125 | — | — | 2,271,125 | ||||||||||||
Non-Agency Collateralized Mortgage Obligations | — | 1,886,082 | — | 1,886,082 | ||||||||||||
Asset-Backed Securities | — | 1,871,764 | — | 1,871,764 | ||||||||||||
Agency Collateralized Mortgage Obligation | — | 1,201,444 | — | 1,201,444 | ||||||||||||
Commercial Mortgage-Backed Security | — | 257,663 | — | 257,663 | ||||||||||||
Sovereign Bond | — | 165,612 | — | 165,612 | ||||||||||||
Short-Term Investment Fund | 534,871 | — | — | 534,871 | ||||||||||||
Total Assets | $ | 2,805,996 | $ | 36,798,483 | $ | — | $ | 39,604,479 |
See accompanying Notes to Financial Statements.
18 |
Touchstone Common Stock Fund – June 30, 2019 (Unaudited)
Market | ||||||||
Shares | Value | |||||||
Common Stocks — 99.8% | ||||||||
Communication Services — 20.3% | ||||||||
Alphabet, Inc. - Class C* | 6,631 | $ | 7,167,514 | |||||
AT&T, Inc. | 74,611 | 2,500,215 | ||||||
Baidu, Inc. (China) ADR* | 8,834 | 1,036,758 | ||||||
Charter Communications, Inc. - Class A* | 8,604 | 3,400,129 | ||||||
Comcast Corp. - Class A | 78,967 | 3,338,725 | ||||||
Facebook, Inc. - Class A* | 33,041 | 6,376,913 | ||||||
Fox Corp. - Class A | 25,625 | 938,900 | ||||||
Walt Disney Co. (The) | 18,291 | 2,554,155 | ||||||
27,313,309 | ||||||||
Information Technology — 19.2% | ||||||||
Apple, Inc. | 27,713 | 5,484,957 | ||||||
Avnet, Inc. | 52,785 | 2,389,577 | ||||||
International Business Machines Corp. | 16,156 | 2,227,912 | ||||||
Microsoft Corp. | 57,831 | 7,747,041 | ||||||
Oracle Corp. | 71,470 | 4,071,646 | ||||||
salesforce.com, Inc.* | 25,709 | 3,900,827 | ||||||
25,821,960 | ||||||||
Financials — 18.1% | ||||||||
Bank of America Corp. | 122,226 | 3,544,554 | ||||||
Berkshire Hathaway, Inc. - Class B* | 63,021 | 13,434,187 | ||||||
Brookfield Asset Management, Inc. (Canada) - Class A | 43,837 | 2,094,532 | ||||||
Goldman Sachs Group, Inc. (The) | 14,583 | 2,983,682 | ||||||
Signature Bank/NewYork NY | 18,654 | 2,254,149 | ||||||
24,311,104 | ||||||||
Health Care — 12.5% | ||||||||
AmerisourceBergen Corp. | 35,797 | 3,052,052 | ||||||
Biogen, Inc.* | 8,418 | 1,968,718 | ||||||
Bristol-Myers Squibb Co. | 59,188 | 2,684,176 | ||||||
Johnson & Johnson | 26,239 | 3,654,568 | ||||||
Novartis AG (Switzerland) ADR | 37,666 | 3,439,282 | ||||||
UnitedHealth Group, Inc. | 7,996 | 1,951,104 | ||||||
16,749,900 | ||||||||
Consumer Discretionary — 11.8% | ||||||||
Alibaba Group Holding Ltd. (China) ADR* | 7,902 | 1,338,994 | ||||||
Amazon.com, Inc.* | 4,009 | 7,591,563 | ||||||
Booking Holdings, Inc.* | 698 | 1,308,548 | ||||||
Carnival Corp. | 48,403 | 2,253,160 | ||||||
JD.com, Inc. (China) ADR* | 32,129 | 973,187 | ||||||
Starbucks Corp. | 8,346 | 699,645 | ||||||
Yum China Holdings, Inc. (China) | 37,748 | 1,743,958 | ||||||
15,909,055 | ||||||||
Industrials — 6.7% | ||||||||
Deere & Co. | 12,522 | 2,075,021 | ||||||
FedEx Corp. | 6,483 | 1,064,444 | ||||||
General Electric Co. | 85,357 | 896,248 | ||||||
Union Pacific Corp. | 14,155 | 2,393,752 | ||||||
United Technologies Corp. | 19,335 | 2,517,417 | ||||||
8,946,882 | ||||||||
Real Estate — 4.7% | ||||||||
Jones Lang LaSalle, Inc. | 21,276 | 2,993,320 | ||||||
Simon Property Group, Inc. REIT | 20,830 | 3,327,801 | ||||||
6,321,121 | ||||||||
Energy — 3.6% | ||||||||
Exxon Mobil Corp. | 32,202 | 2,467,639 | ||||||
Halliburton Co. | 40,910 | 930,293 | ||||||
Schlumberger Ltd. | 36,327 | 1,443,634 | ||||||
4,841,566 | ||||||||
Consumer Staples — 2.9% | ||||||||
Monster Beverage Corp.* | 30,963 | 1,976,368 | ||||||
Unilever NV (United Kingdom) | 30,902 | 1,876,369 | ||||||
3,852,737 | ||||||||
Total Common Stocks | $ | 134,067,634 | ||||||
Short-Term Investment Fund — 0.3% | ||||||||
Dreyfus Government Cash | ||||||||
Management, Institutional Shares, 2.25%∞Ω | 422,306 | $ | 422,306 | |||||
Total Investment Securities —100.1% | ||||||||
(Cost $107,624,700) | $ | 134,489,940 | ||||||
Liabilities in Excess of Other Assets — (0.1%) | (146,480 | ) | ||||||
Net Assets — 100.0% | $ | 134,343,460 |
* | Non-income producing security. |
∞ | Open-End Fund. |
Ω | Represents the 7-day SEC yield as of June 30, 2019. |
Portfolio Abbreviations:
ADR - American Depositary Receipt
REIT - Real Estate Investment Trust
19 |
Touchstone Common Stock Fund (Unaudited) (Continued)
Other Information:
The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the security valuation section in the accompanying Notes to Financial Statements.
Valuation inputs at Reporting Date: | ||||||||||||||||
Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common Stocks | $ | 134,067,634 | $ | — | $ | — | $ | 134,067,634 | ||||||||
Short-Term Investment Fund | 422,306 | — | — | 422,306 | ||||||||||||
Total | $ | 134,489,940 | $ | — | $ | — | $ | 134,489,940 |
See accompanying Notes to Financial Statements.
20 |
Touchstone Focused Fund – June 30, 2019 (Unaudited)
Shares | Market Value | |||||||
Common Stocks — 99.4% | ||||||||
Information Technology — 20.2% | ||||||||
Apple, Inc. | 11,508 | $ | 2,277,663 | |||||
Avnet, Inc. | 22,760 | 1,030,345 | ||||||
International Business Machines Corp. | 7,775 | 1,072,172 | ||||||
Microsoft Corp. | 23,894 | 3,200,840 | ||||||
Oracle Corp. | 30,892 | 1,759,917 | ||||||
salesforce.com, Inc.* | 11,183 | 1,696,797 | ||||||
11,037,734 | ||||||||
Financials — 17.3% | ||||||||
Bank of America Corp. | 53,518 | 1,552,022 | ||||||
Berkshire Hathaway, Inc. - Class B* | 26,428 | 5,633,657 | ||||||
Goldman Sachs Group, Inc. (The) | 6,639 | 1,358,339 | ||||||
Signature Bank/NewYork NY | 7,339 | 886,845 | ||||||
9,430,863 | ||||||||
Communication Services — 17.3% | ||||||||
Alphabet, Inc. - Class C* | 2,327 | 2,515,278 | ||||||
AT&T, Inc. | 31,148 | 1,043,770 | ||||||
Baidu, Inc. (China) ADR* | 3,537 | 415,102 | ||||||
Comcast Corp. - Class A | 36,862 | 1,558,525 | ||||||
Facebook, Inc. - Class A* | 11,553 | 2,229,729 | ||||||
Fox Corp. - Class A | 11,757 | 430,777 | ||||||
Walt Disney Co. (The) | 8,799 | 1,228,692 | ||||||
9,421,873 | ||||||||
Health Care — 14.1% | ||||||||
AmerisourceBergen Corp. | 14,223 | 1,212,653 | ||||||
Biogen, Inc.* | 3,435 | 803,343 | ||||||
Bio-Rad Laboratories, Inc. - Class A* | 2,392 | 747,715 | ||||||
Bristol-Myers Squibb Co. | 23,450 | 1,063,457 | ||||||
Johnson & Johnson | 11,061 | 1,540,576 | ||||||
Novartis AG (Switzerland) ADR | 16,946 | 1,547,339 | ||||||
UnitedHealth Group, Inc. | 3,211 | 783,516 | ||||||
7,698,599 | ||||||||
Consumer Discretionary — 12.5% | ||||||||
Alibaba Group Holding Ltd. (China) ADR* | 3,196 | 541,562 | ||||||
Amazon.com, Inc.* | 1,661 | 3,145,319 | ||||||
Booking Holdings, Inc.* | 281 | 526,794 | ||||||
Carnival Corp. | 20,161 | 938,495 | ||||||
JD.com, Inc. (China) ADR* | 11,995 | 363,329 | ||||||
Starbucks Corp. | 5,497 | 460,814 | ||||||
Yum China Holdings, Inc. (China) | 17,867 | 825,455 | ||||||
6,801,768 | ||||||||
Industrials — 6.7% | ||||||||
Deere & Co. | 5,045 | 836,007 | ||||||
FedEx Corp. | 2,651 | 435,268 | ||||||
General Electric Co. | 37,020 | 388,710 | ||||||
Union Pacific Corp. | 5,844 | 988,279 | ||||||
United Technologies Corp. | 7,518 | 978,844 | ||||||
3,627,108 | ||||||||
Real Estate — 4.8% | ||||||||
Jones Lang LaSalle, Inc. | 8,706 | 1,224,847 | ||||||
Simon Property Group, Inc. REIT | 8,729 | 1,394,545 | ||||||
2,619,392 | ||||||||
Energy — 3.5% | ||||||||
Exxon Mobil Corp. | 11,768 | 901,782 | ||||||
Halliburton Co. | 15,184 | 345,284 | ||||||
Schlumberger Ltd. | 16,338 | 649,272 | ||||||
1,896,338 | ||||||||
Consumer Staples — 3.0% | ||||||||
Monster Beverage Corp.* | 12,537 | 800,237 | ||||||
Unilever NV (United Kingdom) | 14,039 | 852,448 | ||||||
1,652,685 | ||||||||
Total Common Stocks | $ | 54,186,360 | ||||||
Short-Term Investment Fund — 0.8% | ||||||||
Dreyfus Government Cash Management, Institutional Shares, 2.25%∞Ω | 453,484 | $ | 453,484 | |||||
Total Investment Securities —100.2% | ||||||||
(Cost $41,140,284) | $ | 54,639,844 | ||||||
Liabilities in Excess of Other Assets — (0.2%) | (112,280 | ) | ||||||
Net Assets — 100.0% | $ | 54,527,564 |
* | Non-income producing security. |
∞ | Open-End Fund. |
Ω | Represents the 7-day SEC yield as of June 30, 2019. |
Portfolio Abbreviations:
ADR - American Depositary Receipt
REIT - Real Estate Investment Trust
21 |
Touchstone Focused Fund (Unaudited) (Continued)
Other Information:
The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the security valuation section in the accompanying Notes to Financial Statements.
Valuation inputs at Reporting Date: | ||||||||||||||||
Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common Stocks | $ | 54,186,360 | $ | — | $ | — | $ | 54,186,360 | ||||||||
Short-Term Investment Fund | 453,484 | — | — | 453,484 | ||||||||||||
Total | $ | 54,639,844 | $ | — | $ | — | $ | 54,639,844 |
See accompanying Notes to Financial Statements.
22 |
Touchstone Large Cap Core Equity Fund – June 30, 2019 (Unaudited)
Shares | Market Value | |||||||
Common Stocks — 97.5% | ||||||||
Financials — 22.5% | ||||||||
Alleghany Corp.* | 1,264 | $ | 860,923 | |||||
Berkshire Hathaway, Inc. - Class B* | 8,816 | 1,879,307 | ||||||
BlackRock, Inc. | 1,988 | 932,968 | ||||||
Charles Schwab Corp. (The) | 14,903 | 598,952 | ||||||
Progressive Corp. (The) | 11,064 | 884,345 | ||||||
Wells Fargo & Co. | 14,516 | 686,897 | ||||||
5,843,392 | ||||||||
Consumer Discretionary — 20.4% | ||||||||
CarMax, Inc.* | 13,931 | 1,209,629 | ||||||
Carnival Corp. | 16,871 | 785,345 | ||||||
Dollar Tree, Inc.* | 11,523 | 1,237,455 | ||||||
Home Depot, Inc. (The) | 4,183 | 869,938 | ||||||
Lowe's Cos., Inc. | 3,619 | 365,193 | ||||||
O'Reilly Automotive, Inc.* | 2,252 | 831,709 | ||||||
5,299,269 | ||||||||
Information Technology — 13.3% | ||||||||
Apple, Inc. | 7,328 | 1,450,358 | ||||||
Cisco Systems, Inc. | 16,582 | 907,533 | ||||||
Visa, Inc. - Class A | 6,267 | 1,087,638 | ||||||
3,445,529 | ||||||||
Industrials — 12.1% | ||||||||
FedEx Corp. | 5,016 | 823,577 | ||||||
General Dynamics Corp. | 3,643 | 662,370 | ||||||
Norfolk Southern Corp. | 4,982 | 993,062 | ||||||
Southwest Airlines Co. | 13,156 | 668,062 | ||||||
3,147,071 | ||||||||
Communication Services — 9.3% | ||||||||
Alphabet, Inc. - Class C* | 1,144 | 1,236,561 | ||||||
Fox Corp. - Class A | 21,094 | 772,884 | ||||||
Verizon Communications, Inc. | 7,361 | 420,534 | ||||||
2,429,979 | ||||||||
Materials — 7.9% | ||||||||
Albemarle Corp. | 7,435 | 523,498 | ||||||
Martin Marietta Materials, Inc. | 3,675 | 845,654 | ||||||
NewMarket Corp. | 1,717 | 688,414 | ||||||
2,057,566 | ||||||||
Consumer Staples — 7.3% | ||||||||
Altria Group, Inc. | 19,336 | 915,560 | ||||||
Nestle SA (Switzerland) ADR | 9,469 | 979,095 | ||||||
1,894,655 | ||||||||
Energy — 3.2% | ||||||||
Chevron Corp. | 6,636 | 825,784 | ||||||
Health Care — 1.5% | ||||||||
Bristol-Myers Squibb Co. | 8,500 | 385,475 | ||||||
Total Common Stocks | $ | 25,328,720 | ||||||
Short-Term Investment Fund — 2.6% | ||||||||
Dreyfus Government CashManagement, Institutional Shares, 2.25%∞Ω | 688,422 | $ | 688,422 | |||||
Total Investment Securities —100.1% | ||||||||
(Cost $21,873,873) | $ | 26,017,142 | ||||||
Liabilities in Excess of Other Assets — (0.1%) | (31,451 | ) | ||||||
Net Assets — 100.0% | $ | 25,985,691 |
* | Non-income producing security. |
∞ | Open-End Fund. |
Ω | Represents the 7-day SEC yield as of June 30, 2019. |
Portfolio Abbreviations:
ADR - American Depositary Receipt
Other Information:
The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the security valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||||||||||||||
Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common Stocks | $ | 25,328,720 | $ | — | $ | — | $ | 25,328,720 | ||||||||
Short-Term Investment Fund | 688,422 | — | — | 688,422 | ||||||||||||
Total | $ | 26,017,142 | $ | — | $ | — | $ | 26,017,142 |
See accompanying Notes to Financial Statements.
23 |
Touchstone Small Company Fund – June 30, 2019 (Unaudited)
Shares | Market Value | |||||||
Common Stocks — 95.9% | ||||||||
Industrials — 22.7% | ||||||||
Applied Industrial Technologies, Inc. | 12,500 | $ | 769,125 | |||||
ASGN, Inc.* | 6,817 | 413,110 | ||||||
Clean Harbors, Inc.* | 10,500 | 746,550 | ||||||
Crane Co. | 9,682 | 807,866 | ||||||
Curtiss-Wright Corp. | 6,300 | 800,919 | ||||||
EnerSys | 20,233 | 1,385,960 | ||||||
Hillenbrand, Inc. | 19,643 | 777,274 | ||||||
ITT, Inc. | 21,248 | 1,391,319 | ||||||
Mobile Mini, Inc. | 25,385 | 772,466 | ||||||
Quanta Services, Inc. | 35,433 | 1,353,186 | ||||||
Regal Beloit Corp. | 9,607 | 784,988 | ||||||
Rexnord Corp.* | 26,780 | 809,292 | ||||||
SkyWest, Inc. | 21,300 | 1,292,271 | ||||||
Watts Water Technologies, Inc. - Class A | 8,700 | 810,666 | ||||||
WESCO International, Inc.* | 14,590 | 738,983 | ||||||
Woodward, Inc. | 6,761 | 765,075 | ||||||
14,419,050 | ||||||||
Health Care — 20.9% | ||||||||
Allscripts Healthcare Solutions, Inc.* | 73,037 | 849,420 | ||||||
AngioDynamics, Inc.* | 33,599 | 661,564 | ||||||
Bio-Rad Laboratories, Inc. - Class A* | 2,296 | 717,707 | ||||||
Bio-Techne Corp. | 3,536 | 737,221 | ||||||
Chemed Corp. | 2,210 | 797,456 | ||||||
Encompass Health Corp. | 12,283 | 778,251 | ||||||
Globus Medical, Inc. - Class A* | 30,068 | 1,271,876 | ||||||
Haemonetics Corp.* | 6,840 | 823,126 | ||||||
Inogen, Inc.* | 9,387 | 626,676 | ||||||
Integra LifeSciences Holdings Corp.* | 14,596 | 815,187 | ||||||
NuVasive, Inc.* | 13,097 | 766,698 | ||||||
Omnicell, Inc.* | 9,031 | 776,937 | ||||||
Orthofix Medical, Inc.* | 14,324 | 757,453 | ||||||
Premier, Inc. - Class A* | 20,741 | 811,181 | ||||||
Providence Service Corp. (The)* | 11,999 | 688,023 | ||||||
Tactile Systems Technology, Inc.* | 13,800 | 785,496 | ||||||
Vericel Corp.* | 33,500 | 632,815 | ||||||
13,297,087 | ||||||||
Information Technology — 19.5% | ||||||||
8x8, Inc.* | 32,300 | 778,430 | ||||||
Aspen Technology, Inc.* | 6,058 | 752,888 | ||||||
Avaya Holdings Corp.* | 69,565 | 828,519 | ||||||
Bottomline Technologies (de), Inc.* | 17,118 | 757,300 | ||||||
Carbonite, Inc.* | 30,138 | 784,794 | ||||||
Envestnet, Inc.* | 10,800 | 738,396 | ||||||
ExlService Holdings, Inc.* | 5,887 | 389,307 | ||||||
j2 Global, Inc. | 14,285 | 1,269,794 | ||||||
KBR, Inc. | 15,670 | 390,810 | ||||||
MAXIMUS, Inc. | 10,187 | 738,965 | ||||||
NetScout Systems, Inc.* | 1 | 25 | ||||||
Nice Ltd. (Israel) ADR* | 5,368 | 735,416 | ||||||
Nuance Communications, Inc.* | 47,398 | 756,946 | ||||||
Plantronics, Inc. | 17,139 | 634,829 | ||||||
Qualys, Inc.* | 4,428 | 385,590 | ||||||
Rogers Corp.* | 2,700 | 465,966 | ||||||
Rudolph Technologies, Inc.* | 20,322 | 561,497 | ||||||
Tower Semiconductor Ltd.* | 21,742 | 342,871 | ||||||
Verint Systems, Inc.* | 20,600 | 1,107,868 | ||||||
12,420,211 | ||||||||
Consumer Discretionary — 19.1% | ||||||||
Aaron's, Inc. | 13,162 | 808,278 | ||||||
Adtalem Global Education, Inc.* | 18,185 | 819,234 | ||||||
BJ's Restaurants, Inc. | 18,600 | 817,284 | ||||||
Bloomin' Brands, Inc. | 63,672 | 1,204,038 | ||||||
Brunswick Corp. | 17,900 | 821,431 | ||||||
Designer Brands, Inc. - Class A | 27,343 | 524,165 | ||||||
frontdoor, Inc.* | 18,500 | 805,675 | ||||||
G-III Apparel Group Ltd.* | 28,900 | 850,238 | ||||||
Movado Group, Inc. | 28,500 | 769,500 | ||||||
Oxford Industries, Inc. | 10,500 | 795,900 | ||||||
Steven Madden Ltd. | 24,400 | 828,380 | ||||||
Stoneridge, Inc.* | 25,000 | 788,750 | ||||||
Texas Roadhouse, Inc. | 13,978 | 750,199 | ||||||
TopBuild Corp.* | 9,200 | 761,392 | ||||||
YETI Holdings, Inc.*† | 27,200 | 787,440 | ||||||
12,131,904 | ||||||||
Financials — 8.5% | ||||||||
Chemical Financial Corp. | 31,400 | 1,290,854 | ||||||
Glacier Bancorp, Inc. | 17,492 | 709,301 | ||||||
Webster Financial Corp. | 27,673 | 1,321,939 | ||||||
Western Alliance Bancorp* | 29,377 | 1,313,739 | ||||||
WSFS Financial Corp. | 18,100 | 747,530 | ||||||
5,383,363 | ||||||||
Communication Services — 3.4% | ||||||||
Cogent Communications Holdings, Inc. | 12,461 | 739,685 | ||||||
QuinStreet, Inc.* | 45,500 | 721,175 | ||||||
Yelp, Inc.* | 19,800 | 676,764 | ||||||
2,137,624 | ||||||||
Real Estate — 1.1% | ||||||||
Corporate Office Properties Trust REIT | 27,445 | 723,726 | ||||||
Consumer Staples — 0.7% | ||||||||
Chefs' Warehouse, Inc. (The)* | 11,958 | 419,367 | ||||||
Total Common Stocks | $ | 60,932,332 | ||||||
Short-Term Investment Funds — 5.1% | ||||||||
Dreyfus Government Cash Management, Institutional Shares, 2.25%∞Ω | 2,454,289 | $ | 2,454,289 | |||||
Invesco Government & Agency Portfolio, Institutional Class, 2.19%**∞Ω | 787,301 | 787,301 | ||||||
Total Short-Term Investment Funds | $ | 3,241,590 |
24 |
Touchstone Small Company Fund (Unaudited) (Continued)
Market Value | ||||
Total Investment Securities —101.0% | ||||
(Cost $53,488,111) | $ | 64,173,922 | ||
Liabilities in Excess of Other Assets — (1.0%) | (642,610 | ) | ||
Net Assets — 100.0% | $ | 63,531,312 |
* | Non-income producing security. |
** | Represents collateral for securities loaned. |
† | All or a portion of the security is on loan. The total market value of the securities on loan as of June 30, 2019 was $779,566. |
∞ | Open-End Fund. |
Ω | Represents the 7-day SEC yield as of June 30, 2019. |
Portfolio Abbreviations:
ADR - American Depositary Receipt
REIT - Real Estate Investment Trust
Other Information:
The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the security valuation section in the accompanying Notes to Financial Statements.
Valuation inputs at Reporting Date: | ||||||||||||||||
Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common Stocks | $ | 60,932,332 | $ | — | $ | — | $ | 60,932,332 | ||||||||
Short-Term Investment Funds | 3,241,590 | — | — | 3,241,590 | ||||||||||||
Total | $ | 64,173,922 | $ | — | $ | — | $ | 64,173,922 |
See accompanying Notes to Financial Statements.
25 |
Touchstone Aggressive ETF Fund – June 30, 2019 (Unaudited)
Market | ||||||||
Shares | Value | |||||||
Exchange-Traded Funds — 96.9% | ||||||||
Equity Funds — 79.9% | ||||||||
iShares Core S&P Small-Cap ETF | 5,970 | $ | 467,332 | |||||
Vanguard Extended Market ETF | 16,450 | 1,950,641 | ||||||
Vanguard FTSE Developed Markets ETF | 89,745 | 3,743,264 | ||||||
Vanguard FTSE Emerging Markets ETF | 28,310 | 1,204,024 | ||||||
Vanguard S&P 500 ETF | 22,915 | 6,167,572 | ||||||
Vanguard Value ETF | 10,780 | 1,195,718 | ||||||
14,728,551 | ||||||||
Fixed Income Funds — 17.0% | ||||||||
iShares Core Total USD Bond Market ETF | 17,760 | 917,837 | ||||||
iShares Core US Aggregate Bond ETF | 8,225 | 915,854 | ||||||
iShares iBoxx $ High Yield Corporate Bond ETF | 4,250 | 370,515 | ||||||
VanEck Vectors J.P. Morgan EM Local Currency Bond ETF | 5,400 | 187,380 | ||||||
Vanguard Intermediate-Term Corporate Bond ETF | 6,160 | 553,476 | ||||||
Vanguard Total International Bond ETF | 3,190 | 182,787 | ||||||
3,127,849 | ||||||||
Total Exchange-Traded Funds | $ | 17,856,400 | ||||||
Short-Term Investment Fund — 3.1% | ||||||||
Dreyfus Government Cash Management, Institutional Shares, 2.25%∞Ω | 568,835 | $ | 568,835 | |||||
Total Investment Securities —100.0% | ||||||||
(Cost $16,041,285) | $ | 18,425,235 | ||||||
Other Assets in Excess of Liabilities — 0.0% | 1,861 | |||||||
Net Assets — 100.0% | $ | 18,427,096 |
∞ | Open-End Fund. |
Ω | Represents the 7-day SEC yield as of June 30, 2019. |
Portfolio Abbreviations:
ETF - Exchange-Traded Fund
Other Information:
The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the security valuation section in the accompanying Notes to Financial Statements.
Valuation inputs at Reporting Date: | ||||||||||||||||
Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Exchange-Traded Funds | $ | 17,856,400 | $ | — | $ | — | $ | 17,856,400 | ||||||||
Short-Term Investment Fund | 568,835 | — | — | 568,835 | ||||||||||||
Total | $ | 18,425,235 | $ | — | $ | — | $ | 18,425,235 |
See accompanying Notes to Financial Statements.
26 |
Touchstone Conservative ETF Fund– June 30, 2019 (Unaudited)
Market | ||||||||
Shares | Value | |||||||
Exchange-Traded Funds — 99.2% | ||||||||
Fixed Income Funds — 58.2% | ||||||||
iShares Core Total USD Bond Market ETF† | 66,700 | $ | 3,447,056 | |||||
iShares Core US Aggregate Bond ETF | 30,910 | 3,441,829 | ||||||
iShares iBoxx $ High Yield Corporate Bond ETF | 11,845 | 1,032,647 | ||||||
VanEck Vectors J.P. Morgan EM Local | ||||||||
Currency Bond ETF | 10,130 | 351,511 | ||||||
Vanguard Intermediate-Term Corporate | ||||||||
Bond ETF | 13,525 | 1,215,221 | ||||||
Vanguard Total International Bond ETF | 6,020 | 344,946 | ||||||
9,833,210 | ||||||||
Equity Funds — 41.0% | ||||||||
iShares Core S&P Small-Cap ETF | 3,360 | 263,021 | ||||||
Vanguard Extended Market ETF | 8,090 | 959,312 | ||||||
Vanguard FTSE Developed Markets ETF | 39,135 | 1,632,321 | ||||||
Vanguard FTSE Emerging Markets ETF | 10,135 | 431,042 | ||||||
Vanguard S&P 500 ETF | 11,235 | 3,023,900 | ||||||
Vanguard Value ETF | 5,485 | 608,396 | ||||||
6,917,992 | ||||||||
Total Exchange-Traded Funds | $ | 16,751,202 | ||||||
Short-Term Investment Funds — 11.3% | ||||||||
Dreyfus Government Cash Management, Institutional Shares, 2.25%∞Ω | 146,970 | 146,970 | ||||||
Invesco Government & Agency Portfolio, Institutional Class, 2.19%**∞Ω | 1,752,960 | 1,752,960 | ||||||
Total Short-Term Investment Funds | $ | 1,899,930 | ||||||
Total Investment Securities —110.5% | ||||||||
(Cost $16,870,292) | $ | 18,651,132 | ||||||
Liabilities in Excess of Other Assets — (10.5%) | (1,767,377 | ) | ||||||
Net Assets — 100.0% | $ | 16,883,755 |
** | Represents collateral for securities loaned. |
† | All or a portion of the security is on loan. The total market value of the securities on loan as of June 30, 2019 was $1,715,776. |
∞ | Open-End Fund. |
Ω | Represents the 7-day SEC yield as of June 30, 2019. |
Portfolio Abbreviations:
ETF - Exchange-Traded Fund
Other Information:
The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the security valuation section in the accompanying Notes to Financial Statements.
Valuation inputs at Reporting Date: | ||||||||||||||||
Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Exchange-Traded Funds | $ | 16,751,202 | $ | — | $ | — | $ | 16,751,202 | ||||||||
Short-Term Investment Funds | 1,899,930 | — | — | 1,899,930 | ||||||||||||
Total | $ | 18,651,132 | $ | — | $ | — | $ | 18,651,132 |
See accompanying Notes to Financial Statements.
27 |
Touchstone Moderate ETF Fund – June 30, 2019 (Unaudited)
Market | ||||||||
Shares | Value | |||||||
Exchange-Traded Funds — 97.0% | ||||||||
Equity Funds — 60.1% | ||||||||
iShares Core S&P Small-Cap ETF | 4,935 | $ | 386,312 | |||||
Vanguard Extended Market ETF | 12,985 | 1,539,761 | ||||||
Vanguard FTSE Developed Markets ETF | 66,805 | 2,786,437 | ||||||
Vanguard FTSE Emerging Markets ETF | 20,675 | 879,308 | ||||||
Vanguard S&P 500 ETF | 18,530 | 4,987,349 | ||||||
Vanguard Value ETF | 8,635 | 957,794 | ||||||
11,536,961 | ||||||||
Fixed Income Funds — 36.9% | ||||||||
iShares Core Total USD Bond Market ETF | 44,380 | 2,293,559 | ||||||
iShares Core US Aggregate Bond ETF | 20,575 | 2,291,026 | ||||||
iShares iBoxx $ High Yield Corporate Bond ETF | 8,780 | 765,440 | ||||||
VanEck Vectors J.P. Morgan EM Local Currency Bond ETF | 8,440 | 292,868 | ||||||
Vanguard Intermediate-Term Corporate Bond ETF | 12,845 | 1,154,123 | ||||||
Vanguard Total International Bond ETF | 5,000 | 286,500 | ||||||
7,083,516 | ||||||||
Total Exchange-Traded Funds | $ | 18,620,477 | ||||||
Short-Term Investment Fund — 3.0% | ||||||||
Dreyfus Government Cash Management, Institutional Shares, 2.25%∞Ω | 585,278 | $ | 585,278 | |||||
Total Investment Securities —100.0% | ||||||||
(Cost $17,279,637) | $ | 19,205,755 | ||||||
Liabilities in Excess of Other Assets — 0.0% | (8,781 | ) | ||||||
Net Assets — 100.0% | $ | 19,196,974 |
∞ | Open-End Fund. |
Ω | Represents the 7-day SEC yield as of June 30, 2019. |
Portfolio Abbreviations:
ETF - Exchange-Traded Fund
Other Information:
The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the security valuation section in the accompanying Notes to Financial Statements.
Valuation inputs at Reporting Date: | ||||||||||||||||
Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Exchange-Traded Funds | $ | 18,620,477 | $ | — | $ | — | $ | 18,620,477 | ||||||||
Short-Term Investment Fund | 585,278 | — | — | 585,278 | ||||||||||||
Total | $ | 19,205,755 | $ | — | $ | — | $ | 19,205,755 |
See accompanying Notes to Financial Statements.
28 |
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Statements of Assets and Liabilities
June 30, 2019 (Unaudited)
Touchstone | Touchstone | Touchstone | ||||||||||
Active Bond | Balanced | Bond | ||||||||||
Fund | Fund | Fund | ||||||||||
Assets | ||||||||||||
Investments, at cost | $ | 56,331,592 | $ | 15,469,996 | $ | 38,841,259 | ||||||
Investments, at market value(A) | $ | 58,146,422 | $ | 17,889,203 | $ | 39,604,479 | ||||||
Cash | 17 | 13,899 | — | |||||||||
Dividends and interest receivable | 368,140 | 43,606 | 227,810 | |||||||||
Receivable for capital shares sold | — | 769 | 8,976 | |||||||||
Receivable for investments sold | 94,698 | 14,833 | 361,149 | |||||||||
Securities lending income receivable | — | 24 | — | |||||||||
Receivable from other affiliates | — | 201 | 201 | |||||||||
Tax reclaim receivable | — | — | — | |||||||||
Other assets | 540 | 168 | 424 | |||||||||
Total Assets | 58,609,817 | 17,962,703 | 40,203,039 | |||||||||
Liabilities | ||||||||||||
Payable for return of collateral for securities on loan | — | — | — | |||||||||
Payable for capital shares redeemed | 3,719 | 3,525 | 11,293 | |||||||||
Payable for investments purchased | 289,405 | — | 300,000 | |||||||||
Payable to Investment Advisor | 19,024 | 1,005 | 5,802 | |||||||||
Payable to other affiliates | 17,327 | — | — | |||||||||
Payable to Trustees | 7,341 | 7,341 | 7,341 | |||||||||
Payable for professional services | 12,112 | 10,788 | 11,846 | |||||||||
Payable for reports to shareholders | 3,532 | 3,948 | 9,576 | |||||||||
Payable to Transfer Agent | 10,045 | 1,300 | 14,955 | |||||||||
Other accrued expenses and liabilities | 15,162 | 2,694 | 254 | |||||||||
Total Liabilities | 377,667 | 30,601 | 361,067 | |||||||||
Net Assets | $ | 58,232,150 | $ | 17,932,102 | $ | 39,841,972 | ||||||
Net assets consist of: | ||||||||||||
Paid-in capital | $ | 55,920,578 | $ | 14,947,080 | $ | 40,259,150 | ||||||
Distributable earnings (deficit) | 2,311,572 | 2,985,022 | (417,178 | ) | ||||||||
Net assets applicable to shares outstanding | $ | 58,232,150 | $ | 17,932,102 | $ | 39,841,972 | ||||||
Shares of beneficial interest outstanding (unlimited number of shares authorized, no par value) | 5,320,638 | 1,594,259 | 4,021,752 | |||||||||
Net asset value, offering price and redemption price per share | $ | 10.94 | $ | 11.25 | $ | 9.91 | ||||||
(A)Includes market value of securities on loan of: | $ | — | $ | — | $ | — |
See accompanying Notes to Financial Statements.
30 |
Statements of Assets and Liabilities(Unaudited) (Continued)
Touchstone | Touchstone | |||||||||||||||||||||||||
Touchstone | Touchstone | Large Cap | Touchstone | Touchstone | Conservative | Touchstone | ||||||||||||||||||||
Common Stock | Focused | Core Equity | Small Company | Aggressive ETF | ETF | Moderate ETF | ||||||||||||||||||||
Fund | Fund | Fund | Fund | Fund | Fund | Fund | ||||||||||||||||||||
$ | 107,624,700 | $ | 41,140,284 | $ | 21,873,873 | $ | 53,488,111 | $ | 16,041,285 | $ | 16,870,292 | $ | 17,279,637 | |||||||||||||
$ | 134,489,940 | $ | 54,639,844 | $ | 26,017,142 | $ | 64,173,922 | $ | 18,425,235 | $ | 18,651,132 | $ | 19,205,755 | |||||||||||||
— | — | — | — | — | — | — | ||||||||||||||||||||
32,748 | 14,097 | 24,581 | 25,136 | 39,291 | 19,404 | 31,715 | ||||||||||||||||||||
331 | — | 627 | 102 | 47 | — | — | ||||||||||||||||||||
— | — | — | 239,365 | — | — | — | ||||||||||||||||||||
173 | — | — | 143 | 777 | 1,238 | 896 | ||||||||||||||||||||
— | — | — | — | — | — | — | ||||||||||||||||||||
37,745 | 7,543 | — | — | — | — | — | ||||||||||||||||||||
1,404 | 10,746 | 287 | 663 | 180 | 176 | 199 | ||||||||||||||||||||
134,562,341 | 54,672,230 | 26,042,637 | 64,439,331 | 18,465,530 | 18,671,950 | 19,238,565 | ||||||||||||||||||||
— | — | — | 787,301 | — | 1,752,960 | — | ||||||||||||||||||||
75,300 | 39,537 | 3,614 | 13,074 | 2,410 | 1,351 | 2,635 | ||||||||||||||||||||
— | — | — | 26,532 | — | — | — | ||||||||||||||||||||
54,386 | 30,700 | 13,757 | 25,547 | 3,716 | 3,471 | 3,957 | ||||||||||||||||||||
6,368 | 34,596 | 11,572 | 3,422 | 7,655 | 5,929 | 10,231 | ||||||||||||||||||||
7,341 | 7,341 | 7,341 | 7,341 | 7,341 | 7,341 | 7,341 | ||||||||||||||||||||
13,821 | 11,672 | 10,666 | 11,796 | 10,672 | 10,625 | 10,718 | ||||||||||||||||||||
12,058 | 3,073 | 3,669 | 11,265 | 3,532 | 3,532 | 3,532 | ||||||||||||||||||||
46,140 | 14,423 | 4,350 | 16,759 | 38 | 39 | 42 | ||||||||||||||||||||
3,467 | 3,324 | 1,977 | 4,982 | 3,070 | 2,947 | 3,135 | ||||||||||||||||||||
218,881 | 144,666 | 56,946 | 908,019 | 38,434 | 1,788,195 | 41,591 | ||||||||||||||||||||
$ | 134,343,460 | $ | 54,527,564 | $ | 25,985,691 | $ | 63,531,312 | $ | 18,427,096 | $ | 16,883,755 | $ | 19,196,974 | |||||||||||||
$ | 101,433,336 | $ | 38,546,300 | $ | 17,361,672 | $ | 43,929,052 | $ | 14,372,111 | $ | 14,427,262 | $ | 15,474,716 | |||||||||||||
32,910,124 | 15,981,264 | 8,624,019 | 19,602,260 | 4,054,985 | 2,456,493 | 3,722,258 | ||||||||||||||||||||
$ | 134,343,460 | $ | 54,527,564 | $ | 25,985,691 | $ | 63,531,312 | $ | 18,427,096 | $ | 16,883,755 | $ | 19,196,974 | |||||||||||||
15,910,260 | 2,799,692 | 1,565,014 | 4,356,029 | 1,096,137 | 1,411,635 | 1,569,919 | ||||||||||||||||||||
$ | 8.44 | $ | 19.48 | $ | 16.60 | $ | 14.58 | $ | 16.81 | $ | 11.96 | $ | 12.23 | |||||||||||||
$ | — | $ | — | $ | — | $ | 779,566 | $ | — | $ | 1,715,776 | $ | — |
31 |
For the Six Months Ended June 30, 2019 (Unaudited)
Touchstone | Touchstone | Touchstone | ||||||||||
Active Bond | Balanced | Bond | ||||||||||
Fund | Fund | Fund | ||||||||||
Investment Income | ||||||||||||
Dividends(A) | $ | 83,557 | $ | 106,449 | $ | 58,644 | ||||||
Interest | 859,460 | 86,520 | 631,528 | |||||||||
Income from securities loaned | 2 | 39 | 2 | |||||||||
Total Investment Income | 943,019 | 193,008 | 690,174 | |||||||||
Expenses | ||||||||||||
Investment advisory fees | 112,652 | 47,499 | 80,149 | |||||||||
Administration fees | 40,836 | 12,522 | 29,054 | |||||||||
Compliance fees and expenses | 1,212 | 1,212 | 1,212 | |||||||||
Custody fees | 19,440 | 10,501 | 10,727 | |||||||||
Professional fees | 12,235 | 11,688 | 11,900 | |||||||||
Transfer Agent fees | 6,941 | 1,858 | 21,602 | |||||||||
Pricing expense | 16,952 | 9,685 | 11,055 | |||||||||
Reports to Shareholders | 2,387 | 2,727 | 9,684 | |||||||||
Shareholder servicing fees | 17,562 | — | — | |||||||||
Trustee fees | 7,381 | 7,381 | 7,381 | |||||||||
Other expenses | 6,806 | 5,857 | 6,208 | |||||||||
Total Expenses | 244,404 | 110,930 | 188,972 | |||||||||
Fees waived and/or reimbursed by the Advisor and/or Affiliates(B) | — | (37,522 | ) | (54,722 | ) | |||||||
Net Expenses | 244,404 | 73,408 | 134,250 | |||||||||
Net Investment Income | 698,615 | 119,600 | 555,924 | |||||||||
Realized and Unrealized Gains (Losses) on Investments | ||||||||||||
Net realized gains on investments | 667,352 | 215,655 | 699,171 | |||||||||
Net realized losses on foreign currency transactions | (42 | ) | — | — | ||||||||
Net realized gains on futures contracts | 59,306 | — | 50,247 | |||||||||
Net change in unrealized appreciation (depreciation) on investments | 2,542,518 | 1,902,083 | 1,706,918 | |||||||||
Net change in unrealized appreciation (depreciation) on foreign currency transactions | — | — | — | |||||||||
Net change in unrealized appreciation (depreciation) on futures contracts | 13,420 | — | — | |||||||||
Net Realized and Unrealized Gains (Losses) on Investments | 3,282,554 | 2,117,738 | 2,456,336 | |||||||||
Change in Net Assets Resulting from Operations | $ | 3,981,169 | $ | 2,237,338 | $ | 3,012,260 | ||||||
(A) Net of foreign tax withholding of: | $ | — | $ | 2,652 | $ | — | ||||||
(B)See Note 4 in Notes to Financial Statements. |
See accompanying Notes to Financial Statements.
32 |
Statements of Operations (Unaudited) (Continued)
Touchstone | Touchstone | |||||||||||||||||||||||||
Touchstone | Touchstone | Large Cap | Touchstone | Touchstone | Conservative | Touchstone | ||||||||||||||||||||
Common Stock | Focused | Core Equity | Small Company | Aggressive ETF | ETF | Moderate ETF | ||||||||||||||||||||
Fund | Fund | Fund | Fund | Fund | Fund | Fund | ||||||||||||||||||||
$ | 1,127,159 | $ | 458,230 | $ | 279,234 | $ | 281,134 | $ | 207,857 | $ | 213,007 | $ | 236,971 | |||||||||||||
— | — | — | — | — | — | — | ||||||||||||||||||||
290 | 114 | — | 3,368 | 4,079 | 6,678 | 6,032 | ||||||||||||||||||||
1,127,449 | 458,344 | 279,234 | 284,502 | 211,936 | 219,685 | 243,003 | ||||||||||||||||||||
335,119 | 190,004 | 86,027 | 158,094 | 22,379 | 20,887 | 24,326 | ||||||||||||||||||||
97,184 | 39,358 | 19,191 | 45,847 | 12,980 | 12,114 | 14,109 | ||||||||||||||||||||
1,212 | 1,212 | 1,212 | 1,212 | 1,212 | 1,212 | 1,212 | ||||||||||||||||||||
2,803 | 5,625 | 2,940 | 4,296 | 1,397 | 1,552 | 1,431 | ||||||||||||||||||||
14,498 | 12,351 | 10,809 | 12,117 | 10,663 | 10,632 | 10,715 | ||||||||||||||||||||
66,058 | 11,581 | 3,029 | 15,605 | 34 | 34 | 46 | ||||||||||||||||||||
915 | 918 | 660 | 1,549 | 240 | 283 | 283 | ||||||||||||||||||||
12,121 | 2,387 | 2,387 | 11,363 | 2,387 | 2,387 | 2,387 | ||||||||||||||||||||
— | 56,559 | 22,721 | — | 22,379 | 20,887 | 20,879 | ||||||||||||||||||||
7,381 | 7,381 | 7,381 | 7,381 | 7,381 | 7,381 | 7,381 | ||||||||||||||||||||
6,823 | 5,879 | 5,501 | 5,828 | 5,357 | 5,342 | 5,391 | ||||||||||||||||||||
544,114 | 333,255 | 161,858 | 263,292 | 86,409 | 82,711 | 88,160 | ||||||||||||||||||||
(54,841 | ) | (4,825 | ) | (21,629 | ) | (22,990 | ) | (19,273 | ) | (20,050 | ) | (15,181 | ) | |||||||||||||
489,273 | 328,430 | 140,229 | 240,302 | 67,136 | 62,661 | 72,979 | ||||||||||||||||||||
638,176 | 129,914 | 139,005 | 44,200 | 144,800 | 157,024 | 170,024 | ||||||||||||||||||||
1,900,389 | 630,485 | 1,743,766 | 2,089,929 | 200,584 | 69,720 | 281,546 | ||||||||||||||||||||
— | — | — | — | — | — | — | ||||||||||||||||||||
— | — | — | — | — | — | — | ||||||||||||||||||||
17,061,310 | 6,858,292 | 1,508,369 | 6,443,583 | 1,980,122 | 1,382,652 | 1,756,480 | ||||||||||||||||||||
— | 56 | — | — | — | — | — | ||||||||||||||||||||
— | — | — | — | — | — | — | ||||||||||||||||||||
18,961,699 | 7,488,833 | 3,252,135 | 8,533,512 | 2,180,706 | 1,452,372 | 2,038,026 | ||||||||||||||||||||
$ | 19,599,875 | $ | 7,618,747 | $ | 3,391,140 | $ | 8,577,712 | $ | 2,325,506 | $ | 1,609,396 | $ | 2,208,050 | |||||||||||||
$ | (11,354 | ) | $ | 11,234 | $ | 3,692 | $ | 943 | $ | — | $ | — | $ | — |
33 |
Statements of Changes in Net Assets
Touchstone | Touchstone | |||||||||||||||
Active Bond | Balanced | |||||||||||||||
Fund | Fund | |||||||||||||||
For the | For the | For the | For the | |||||||||||||
Six Months | Year | Six Months | Year | |||||||||||||
Ended | Ended | Ended | Ended | |||||||||||||
June 30, 2019 | December 31, | June 30, 2019 | December 31, | |||||||||||||
(Unaudited) | 2018 | (Unaudited) | 2018 | |||||||||||||
From Operations | ||||||||||||||||
Net investment income | $ | 698,615 | $ | 1,402,145 | $ | 119,600 | $ | 214,410 | ||||||||
Net realized gains (losses) on investments, foreign currency transactions and futures contracts | 726,616 | (1,254,267 | ) | 215,655 | 26,223 | |||||||||||
Net change in unrealized appreciation (depreciation) on investments, foreign currency transactions and futures contracts | 2,555,938 | (1,056,527 | ) | 1,902,083 | (1,254,657 | ) | ||||||||||
Change in Net Assets from Operations | 3,981,169 | (908,649 | ) | 2,237,338 | (1,014,024 | ) | ||||||||||
Distributions to Shareholders: | ||||||||||||||||
Distributed earnings | — | (1,215,721 | ) | — | (4,925,790 | ) | ||||||||||
Total Distributions | — | (1,215,721 | ) | — | (4,925,790 | ) | ||||||||||
Share Transactions | ||||||||||||||||
Proceeds from Shares issued | 875,927 | 2,398,497 | 725,248 | 987,463 | ||||||||||||
Reinvestment of distributions | — | 1,215,721 | — | 4,925,790 | ||||||||||||
Cost of Shares redeemed | (2,373,697 | ) | (3,109,625 | ) | (1,001,171 | ) | (1,966,389 | ) | ||||||||
Change in Net Assets from Share Transactions | (1,497,770 | ) | 504,593 | (275,923 | ) | 3,946,864 | ||||||||||
Total Increase (Decrease) in Net Assets | 2,483,399 | (1,619,777 | ) | 1,961,415 | (1,992,950 | ) | ||||||||||
Net Assets | ||||||||||||||||
Beginning of period | 55,748,751 | 57,368,528 | 15,970,687 | 17,963,637 | ||||||||||||
End of period | $ | 58,232,150 | $ | 55,748,751 | $ | 17,932,102 | $ | 15,970,687 | ||||||||
Share Transactions | ||||||||||||||||
Shares issued | 83,742 | 229,548 | 67,758 | 67,923 | ||||||||||||
Shares reinvested | — | 119,423 | — | 475,626 | ||||||||||||
Shares redeemed | (226,164 | ) | (299,575 | ) | (92,600 | ) | (134,014 | ) | ||||||||
Change in Shares Outstanding | (142,422 | ) | 49,396 | (24,842 | ) | 409,535 |
See accompanying Notes to Financial Statements.
34 |
Statements of Changes in Net Assets(Continued)
Touchstone | Touchstone | Touchstone | ||||||||||||||||||||
Bond | Common Stock | Focused | ||||||||||||||||||||
Fund | Fund | Fund | ||||||||||||||||||||
For the | For the | For the | For the | For the | For the | |||||||||||||||||
Six Months | Year | Six Months | Year | Six Months | Year | |||||||||||||||||
Ended | Ended | Ended | Ended | Ended | Ended | |||||||||||||||||
June 30, 2019 | December 31, | June 30, 2019 | December 31, | June 30, 2019 | December 31, | |||||||||||||||||
(Unaudited) | 2018 | (Unaudited) | 2018 | (Unaudited) | 2018 | |||||||||||||||||
$ | 555,924 | $ | 1,161,279 | $ | 638,176 | $ | 1,155,513 | $ | 129,914 | $ | 214,620 | |||||||||||
749,418 | (942,261 | ) | 1,900,389 | 2,353,226 | 630,485 | 1,582,345 | ||||||||||||||||
1,706,918 | (1,114,860 | ) | 17,061,310 | (13,834,239 | ) | 6,858,348 | (5,988,683 | ) | ||||||||||||||
3,012,260 | (895,842 | ) | 19,599,875 | (10,325,500 | ) | 7,618,747 | (4,191,718 | ) | ||||||||||||||
— | (1,019,953 | ) | — | (78,252,461 | ) | — | (1,443,640 | ) | ||||||||||||||
— | (1,019,953 | ) | — | (78,252,461 | ) | — | (1,443,640 | ) | ||||||||||||||
933,715 | 1,866,228 | 901,576 | 2,634,209 | 189,411 | 2,053,387 | |||||||||||||||||
— | 1,019,953 | — | 78,252,461 | — | 1,443,640 | |||||||||||||||||
(5,912,143 | ) | (6,084,112 | ) | (10,954,315 | ) | (25,949,973 | ) | (4,340,112 | ) | (8,735,725 | ) | |||||||||||
(4,978,428 | ) | (3,197,931 | ) | (10,052,739 | ) | 54,936,697 | (4,150,701 | ) | (5,238,698 | ) | ||||||||||||
(1,966,168 | ) | (5,113,726 | ) | 9,547,136 | (33,641,264 | ) | 3,468,046 | (10,874,056 | ) | |||||||||||||
41,808,140 | 46,921,866 | 124,796,324 | 158,437,588 | 51,059,518 | 61,933,574 | |||||||||||||||||
$ | 39,841,972 | $ | 41,808,140 | $ | 134,343,460 | $ | 124,796,324 | $ | 54,527,564 | $ | 51,059,518 | |||||||||||
97,637 | 198,321 | 111,870 | 142,207 | 10,071 | 106,416 | |||||||||||||||||
— | 111,227 | — | 9,951,769 | — | 81,006 | |||||||||||||||||
(623,453 | ) | (648,688 | ) | (1,335,056 | ) | (1,412,961 | ) | (229,153 | ) | (449,637 | ) | |||||||||||
(525,816 | ) | (339,140 | ) | (1,223,186 | ) | 8,681,015 | (219,082 | ) | (262,215 | ) |
35 |
Statements of Changes in Net Assets(Continued)
Touchstone | Touchstone | |||||||||||||||
Large Cap Core | Small Company | |||||||||||||||
Equity Fund | Fund | |||||||||||||||
For the | For the | For the | For the | |||||||||||||
Six Months | Year | Six Months | Year | |||||||||||||
Ended | Ended | Ended | Ended | |||||||||||||
June 30, 2019 | December 31, | June 30, 2019 | December 31, | |||||||||||||
(Unaudited) | 2018 | (Unaudited) | 2018 | |||||||||||||
From Operations | ||||||||||||||||
Net investment income | $ | 139,005 | $ | 171,144 | $ | 44,200 | $ | 37,511 | ||||||||
Net realized gains on investments | 1,743,766 | 2,431,422 | 2,089,929 | 7,084,151 | ||||||||||||
Net change in unrealized appreciation (depreciation) on investments | 1,508,369 | (4,368,016 | ) | 6,443,583 | (11,719,149 | ) | ||||||||||
Change in Net Assets from Operations | 3,391,140 | (1,765,450 | ) | 8,577,712 | (4,597,487 | ) | ||||||||||
Distributions to Shareholders: | ||||||||||||||||
Distributed earnings | — | (1,075,458 | ) | — | (7,753,304 | ) | ||||||||||
Total Distributions | — | (1,075,458 | ) | — | (7,753,304 | ) | ||||||||||
Share Transactions | ||||||||||||||||
Proceeds from Shares issued | 558,361 | 1,884,064 | 1,030,058 | 3,115,279 | ||||||||||||
Reinvestment of distributions | — | 1,075,458 | — | 7,753,304 | ||||||||||||
Cost of Shares redeemed | (3,774,036 | ) | (8,273,866 | ) | (3,960,656 | ) | (10,972,131 | ) | ||||||||
Change in Net Assets from Share Transactions | (3,215,675 | ) | (5,314,344 | ) | (2,930,598 | ) | (103,548 | ) | ||||||||
Total Increase (Decrease) in Net Assets | 175,465 | (8,155,252 | ) | 5,647,114 | (12,454,339 | ) | ||||||||||
Net Assets | ||||||||||||||||
Beginning of period | 25,810,226 | 33,965,478 | 57,884,198 | 70,338,537 | ||||||||||||
End of period | $ | 25,985,691 | $ | 25,810,226 | $ | 63,531,312 | $ | 57,884,198 | ||||||||
Share Transactions | ||||||||||||||||
Shares issued | 35,574 | 109,959 | 71,936 | 190,433 | ||||||||||||
Shares reinvested | — | 70,900 | — | 563,467 | ||||||||||||
Shares redeemed | (235,239 | ) | (499,688 | ) | (276,783 | ) | (664,831 | ) | ||||||||
Change in Shares Outstanding | (199,665 | ) | (318,829 | ) | (204,847 | ) | 89,069 |
See accompanying Notes to Financial Statements.
36 |
Statements of Changes in Net Assets(Continued)
Touchstone | Touchstone | Touchstone | ||||||||||||||||||||
Aggressive ETF | Conservative ETF | Moderate ETF | ||||||||||||||||||||
Fund | Fund | Fund | ||||||||||||||||||||
For the | For the | For the | For the | For the | For the | |||||||||||||||||
Six Months | Year | Six Months | Year | Six Months | Year | |||||||||||||||||
Ended | Ended | Ended | Ended | Ended | Ended | |||||||||||||||||
June 30, 2019 | December 31, | June 30, 2019 | December 31, | June 30, 2019 | December 31, | |||||||||||||||||
(Unaudited) | 2018 | (Unaudited) | 2018 | (Unaudited) | 2018 | |||||||||||||||||
$ | 144,800 | $ | 310,121 | $ | 157,024 | $ | 389,697 | $ | 170,024 | $ | 395,735 | |||||||||||
200,584 | 1,015,976 | 69,720 | 64,256 | 281,546 | 949,343 | |||||||||||||||||
1,980,122 | (2,737,022 | ) | 1,382,652 | (1,186,959 | ) | 1,756,480 | (2,550,390 | ) | ||||||||||||||
2,325,506 | (1,410,925 | ) | 1,609,396 | (733,006 | ) | 2,208,050 | (1,205,312 | ) | ||||||||||||||
— | (856,485 | ) | — | (612,303 | ) | — | (1,029,779 | ) | ||||||||||||||
— | (856,485 | ) | — | (612,303 | ) | — | (1,029,779 | ) | ||||||||||||||
215,858 | 367,839 | 871,927 | 6,001,203 | 316,883 | 654,963 | |||||||||||||||||
— | 856,485 | — | 612,303 | — | 1,029,779 | |||||||||||||||||
(1,007,825 | ) | (2,447,202 | ) | (2,641,091 | ) | (5,055,678 | ) | (1,986,657 | ) | (4,244,729 | ) | |||||||||||
(791,967 | ) | (1,222,878 | ) | (1,769,164 | ) | 1,557,828 | (1,669,774 | ) | (2,559,987 | ) | ||||||||||||
1,533,539 | (3,490,288 | ) | (159,768 | ) | 212,519 | 538,276 | (4,795,078 | ) | ||||||||||||||
16,893,557 | 20,383,845 | 17,043,523 | 16,831,004 | 18,658,698 | 23,453,776 | |||||||||||||||||
$ | 18,427,096 | $ | 16,893,557 | $ | 16,883,755 | $ | 17,043,523 | $ | 19,196,974 | $ | 18,658,698 | |||||||||||
13,597 | 21,831 | 74,496 | 513,937 | 27,769 | 53,409 | |||||||||||||||||
— | 56,227 | — | 55,583 | — | 91,877 | |||||||||||||||||
(62,618 | ) | (143,914 | ) | (230,631 | ) | (435,181 | ) | (168,410 | ) | (347,156 | ) | |||||||||||
(49,021 | ) | (65,856 | ) | (156,135 | ) | 134,339 | (140,641 | ) | (201,870 | ) |
37 |
Touchstone Active Bond Fund
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||
Ended | ||||||||||||||||||||||||
June 30, 2019 | Year Ended December 31, | |||||||||||||||||||||||
(Unaudited) | 2018 | 2017 | 2016 | 2015 | 2014 | |||||||||||||||||||
Net asset value at beginning of period | $ | 10.20 | $ | 10.60 | $ | 10.51 | $ | 10.13 | $ | 10.49 | $ | 10.37 | ||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||
Net investment income | 0.14 | 0.26 | 0.21 | 0.26 | 0.19 | 0.20 | ||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 0.60 | (0.43 | ) | 0.16 | 0.35 | (0.32 | ) | 0.20 | ||||||||||||||||
Total from investment operations | 0.74 | (0.17 | ) | 0.37 | 0.61 | (0.13 | ) | 0.40 | ||||||||||||||||
Distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.23 | ) | (0.28 | ) | (0.23 | ) | (0.23 | ) | (0.28 | ) | |||||||||||||
Net asset value at end of period | $ | 10.94 | $ | 10.20 | $ | 10.60 | $ | 10.51 | $ | 10.13 | $ | 10.49 | ||||||||||||
Total return(A) | 7.26 | %(B) | (1.62 | %) | 3.54 | % | 5.98 | % | (1.28 | %) | 3.82 | % | ||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 58,232 | $ | 55,749 | $ | 57,369 | $ | 55,012 | $ | 52,026 | $ | 48,978 | ||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||
Net expenses | 0.87 | %(C) | 0.84 | % | 0.89 | % | 0.92 | %(D) | 0.97 | %(D) | 0.98 | % | ||||||||||||
Gross expenses | 0.87 | %(C) | 0.84 | % | 0.89 | % | 0.90 | % | 0.91 | % | 1.01 | % | ||||||||||||
Net investment income | 2.48 | %(C) | 2.49 | % | 2.05 | % | 2.47 | % | 2.10 | % | 1.92 | % | ||||||||||||
Portfolio turnover rate | 125 | %(B) | 335 | % | 482 | % | 584 | % | 455 | %(E) | 287 | % |
Touchstone Balanced Fund
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||
Ended | ||||||||||||||||||||||||
June 30, 2019 | Year Ended December 31, | |||||||||||||||||||||||
(Unaudited) | 2018 | 2017 | 2016 | 2015 | 2014 | |||||||||||||||||||
Net asset value at beginning of period | $ | 9.86 | $ | 14.85 | $ | 13.02 | $ | 12.49 | $ | 13.45 | $ | 13.53 | ||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||
Net investment income | 0.08 | 0.18 | (F) | 0.14 | 0.15 | (F) | 0.20 | (F) | 0.18 | (F) | ||||||||||||||
Net realized and unrealized gains (losses) on investments | 1.31 | (0.92 | ) | 1.69 | 0.78 | (0.19 | ) | 0.88 | ||||||||||||||||
Total from investment operations | 1.39 | (0.74 | ) | 1.83 | 0.93 | 0.01 | 1.06 | |||||||||||||||||
Distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.12 | ) | — | (0.18 | ) | (0.25 | ) | (0.23 | ) | ||||||||||||||
Realized capital gains | — | (4.13 | ) | — | (0.20 | ) | (0.72 | ) | (0.91 | ) | ||||||||||||||
Return of capital | — | — | — | (0.02 | ) | — | — | |||||||||||||||||
Total distributions | — | (4.25 | ) | — | (0.40 | ) | (0.97 | ) | (1.14 | ) | ||||||||||||||
Net asset value at end of period | $ | 11.25 | $ | 9.86 | $ | 14.85 | $ | 13.02 | $ | 12.49 | $ | 13.45 | ||||||||||||
Total return(A) | 14.10 | %(B) | (6.07 | %) | 14.06 | % | 7.42 | % | 0.03 | % | 7.81 | % | ||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 17,932 | $ | 15,971 | $ | 17,964 | $ | 15,988 | $ | 15,301 | $ | 15,963 | ||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||
Net expenses | 0.85 | %(C) | 0.85 | % | 0.85 | % | 0.85 | % | 0.87 | % | 0.90 | % | ||||||||||||
Gross expenses | 1.28 | %(C) | 1.15 | % | 0.97 | % | 0.88 | % | 0.87 | % | 0.90 | % | ||||||||||||
Net investment income | 1.38 | %(C) | 1.22 | % | 1.01 | % | 1.16 | % | 1.50 | %(G) | 1.31 | % | ||||||||||||
Portfolio turnover rate | 46 | %(B) | 140 | % | 142 | % | 30 | % | 38 | % | 76 | % |
(A) | Total returns do not include any insurance, sales or administrative charges of variable annuity or life insurance contracts. If these charges were included, the returns would be lower. |
(B) | Not annualized. |
(C) | Annualized. |
(D) | Net expenses include amounts recouped by the Advisor. |
(E) | Portfolio turnover excludes the purchases and sales of the Touchstone High Yield Fund acquired on December 7, 2015. If these transactions were included, portfolio turnover would have been higher. |
(F) | The net investment income per share was based on average shares outstanding for the period. |
(G) | Includes the impact of special dividends resulting from an acquisition of Covidien plc by Medtronic, Inc. on January 26, 2015 through the formation of a new holding company, Medtronic plc, incorporated in Ireland. These special dividends enhanced the ratio of net investment income by 0.47% for the fiscal year ended December 31, 2015. |
See accompanying Notes to Financial Statements.
38 |
Financial Highlights(Continued)
Touchstone Bond Fund
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||
Ended | ||||||||||||||||||||||||
June 30, 2019 | Year Ended December 31, | |||||||||||||||||||||||
(Unaudited) | 2018 | 2017 | 2016 | 2015 | 2014 | |||||||||||||||||||
Net asset value at beginning of period | $ | 9.19 | $ | 9.60 | $ | 9.26 | $ | 9.38 | $ | 9.83 | $ | 9.75 | ||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||
Net investment income | 0.17 | 0.28 | 0.18 | 0.14 | (A) | 0.27 | (A) | 0.29 | (A) | |||||||||||||||
Net realized and unrealized gains (losses) on investments | 0.55 | (0.46 | ) | 0.16 | (0.06 | ) | (0.40 | ) | 0.10 | |||||||||||||||
Total from investment operations | 0.72 | (0.18 | ) | 0.34 | 0.08 | (0.13 | ) | 0.39 | ||||||||||||||||
Distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.23 | ) | — | (0.20 | ) | (0.32 | ) | (0.31 | ) | ||||||||||||||
Net asset value at end of period | $ | 9.91 | $ | 9.19 | $ | 9.60 | $ | 9.26 | $ | 9.38 | $ | 9.83 | ||||||||||||
Total return(B) | 7.84 | %(C) | (1.88 | %) | 3.67 | % | 0.81 | % | (1.29 | %) | 4.01 | % | ||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 39,842 | $ | 41,808 | $ | 46,922 | $ | 48,680 | $ | 57,312 | $ | 67,067 | ||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||
Net expenses | 0.67 | %(D) | 0.67 | % | 0.68 | % | 0.67 | % | 0.67 | % | 0.65 | % | ||||||||||||
Gross expenses | 0.94 | %(D) | 0.87 | % | 0.71 | % | 0.67 | % | 0.67 | % | 0.65 | % | ||||||||||||
Net investment income | 2.77 | %(D) | 2.62 | % | 1.83 | % | 1.46 | % | 2.69 | % | 2.90 | % | ||||||||||||
Portfolio turnover rate | 119 | %(C) | 431 | % | 168 | % | 197 | % | 117 | % | 117 | % |
Touchstone Common Stock Fund
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||
Ended | ||||||||||||||||||||||||
June 30, 2019 | Year Ended December 31, | |||||||||||||||||||||||
(Unaudited) | 2018 | 2017 | 2016 | 2015 | 2014 | |||||||||||||||||||
Net asset value at beginning of period | $ | 7.28 | $ | 18.74 | $ | 15.52 | $ | 15.46 | $ | 17.69 | $ | 18.39 | ||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||
Net investment income | 0.05 | 0.14 | (A) | 0.22 | 0.25 | (A) | 0.44 | (A) | 0.30 | (A) | ||||||||||||||
Net realized and unrealized gains (losses) on investments | 1.11 | (1.00 | ) | 3.11 | 1.49 | (0.39 | ) | 1.61 | ||||||||||||||||
Total from investment operations | 1.16 | (0.86 | ) | 3.33 | 1.74 | 0.05 | 1.91 | |||||||||||||||||
Distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.11 | ) | (— | )(E) | (0.27 | ) | (0.49 | ) | (0.33 | ) | |||||||||||||
Realized capital gains | — | (10.49 | ) | (0.11 | ) | (1.41 | ) | (1.79 | ) | (2.28 | ) | |||||||||||||
Total distributions | — | (10.60 | ) | (0.11 | ) | (1.68 | ) | (2.28 | ) | (2.61 | ) | |||||||||||||
Net asset value at end of period | $ | 8.44 | $ | 7.28 | $ | 18.74 | $ | 15.52 | $ | 15.46 | $ | 17.69 | ||||||||||||
Total return(B) | 15.93 | %(C) | (8.05 | %) | 21.50 | % | 11.26 | % | 0.19 | % | 10.34 | % | ||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 134,343 | $ | 124,796 | $ | 158,438 | $ | 149,238 | $ | 161,148 | $ | 198,524 | ||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||
Net expenses | 0.73 | %(D) | 0.73 | % | 0.71 | % | 0.73 | % | 0.72 | % | 0.72 | % | ||||||||||||
Gross expenses | 0.81 | %(D) | 0.83 | % | 0.71 | % | 0.73 | % | 0.72 | % | 0.72 | % | ||||||||||||
Net investment income | 0.95 | %(D) | 0.77 | % | 1.21 | % | 1.58 | % | 2.48 | %(F) | 1.57 | % | ||||||||||||
Portfolio turnover rate | 4 | %(C) | 10 | % | 84 | % | 6 | % | 9 | % | 13 | % |
(A) | The net investment income per share was based on average shares outstanding for the period. |
(B) | Total returns do not include any insurance, sales or administrative charges of variable annuity or life insurance contracts. If these charges were included, the returns would be lower. |
(C) | Not annualized. |
(D) | Annualized. |
(E) | Less than $0.005 per share. |
(F) | Includes the impact of special dividends resulting from an acquisition of Covidien plc by Medtronic, Inc. on January 26, 2015 through the formation of a new holding company, Medtronic plc, incorporated in Ireland. These special dividends enhanced the ratio of net investment income by 0.47% for the fiscal year ended December 31, 2015. |
See accompanying Notes to Financial Statements.
39 |
Financial Highlights(Continued)
Touchstone Focused Fund
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||
Ended | ||||||||||||||||||||||||
June 30, 2019 | Year Ended December 31, | |||||||||||||||||||||||
(Unaudited) | 2018 | 2017 | 2016 | 2015 | 2014 | |||||||||||||||||||
Net asset value at beginning of period | $ | 16.91 | $ | 18.88 | $ | 16.70 | $ | 17.95 | $ | 18.64 | $ | 18.81 | ||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) | 0.05 | 0.08 | 0.09 | 0.09 | (0.01 | ) | (0.08 | ) | ||||||||||||||||
Net realized and unrealized gains (losses) on investments | 2.52 | (1.56 | ) | 2.19 | 2.31 | 0.37 | 2.49 | |||||||||||||||||
Total from investment operations | 2.57 | (1.48 | ) | 2.28 | 2.40 | 0.36 | 2.41 | |||||||||||||||||
Distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.09 | ) | (0.10 | ) | — | — | — | ||||||||||||||||
Realized capital gains | — | (0.40 | ) | — | (3.65 | ) | (1.05 | ) | (2.58 | ) | ||||||||||||||
Total distributions | — | (0.49 | ) | (0.10 | ) | (3.65 | ) | (1.05 | ) | (2.58 | ) | |||||||||||||
Net asset value at end of period | $ | 19.48 | $ | 16.91 | $ | 18.88 | $ | 16.70 | $ | 17.95 | $ | 18.64 | ||||||||||||
Total return(A) | 15.20 | %(B) | (7.97 | %) | 13.64 | % | 13.11 | % | 1.97 | % | 13.10 | % | ||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 54,528 | $ | 51,060 | $ | 61,934 | $ | 62,227 | $ | 68,317 | $ | 25,178 | ||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||
Net expenses | 1.21 | %(C) | 1.21 | %(D) | 1.21 | %(D) | 1.21 | %(D) | 1.21 | % | 1.23 | % | ||||||||||||
Gross expenses | 1.23 | %(C) | 1.20 | % | 1.17 | % | 1.17 | % | 1.32 | % | 1.33 | % | ||||||||||||
Net investment income (loss) | 0.48 | %(C) | 0.36 | % | 0.40 | % | 0.55 | % | (0.07 | %) | (0.43 | %) | ||||||||||||
Portfolio turnover rate | 4 | %(B) | 11 | % | 12 | % | 21 | % | 286 | %(E) | 72 | % |
Touchstone Large Cap Core Equity Fund
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||
Ended | ||||||||||||||||||||||||
June 30, 2019 | Year Ended December 31, | |||||||||||||||||||||||
(Unaudited) | 2018 | 2017 | 2016 | 2015 | 2014 | |||||||||||||||||||
Net asset value at beginning of period | $ | 14.63 | $ | 16.30 | $ | 13.72 | $ | 14.07 | $ | 14.90 | $ | 13.09 | ||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||
Net investment income | 0.10 | 0.12 | 0.09 | 0.08 | 0.18 | 0.18 | ||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 1.87 | (1.16 | ) | 2.83 | 1.18 | (0.77 | ) | 1.78 | ||||||||||||||||
Total from investment operations | 1.97 | (1.04 | ) | 2.92 | 1.26 | (0.59 | ) | 1.96 | ||||||||||||||||
Distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.10 | ) | (0.10 | ) | (0.11 | ) | (0.24 | ) | (0.15 | ) | |||||||||||||
Realized capital gains | — | (0.53 | ) | (0.24 | ) | (1.50 | ) | — | — | |||||||||||||||
Total distributions | — | (0.63 | ) | (0.34 | ) | (1.61 | ) | (0.24 | ) | (0.15 | ) | |||||||||||||
Net asset value at end of period | $ | 16.60 | $ | 14.63 | $ | 16.30 | $ | 13.72 | $ | 14.07 | $ | 14.90 | ||||||||||||
Total return(A) | 13.47 | %(B) | (6.49 | %) | 21.32 | % | 8.84 | % | (4.01 | %) | 14.93 | % | ||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 25,986 | $ | 25,810 | $ | 33,965 | $ | 32,492 | $ | 29,894 | $ | 40,664 | ||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||
Net expenses | 1.06 | %(C) | 1.06 | % | 1.06 | % | 1.06 | % | 1.06 | % | 1.04 | % | ||||||||||||
Gross expenses | 1.22 | %(C) | 1.16 | % | 1.15 | % | 1.17 | % | 1.14 | % | 1.16 | % | ||||||||||||
Net investment income | 1.05 | %(C) | 0.56 | % | 0.52 | % | 0.75 | % | 0.73 | % | 1.30 | % | ||||||||||||
Portfolio turnover rate | 11 | %(B) | 20 | % | 12 | % | 50 | % | 111 | % | 41 | % |
(A) | Total returns do not include any insurance, sales or administrative charges of variable annuity or life insurance contracts. If these charges were included, the returns would be lower. |
(B) | Not annualized. |
(C) | Annualized. |
(D) | Net expenses include amounts recouped by the Advisor. |
(E) | Portfolio turnover excludes the purchases and sales of the Touchstone Baron Small Cap Growth Fund and Touchstone Third Avenue Value Fund acquired on December 7, 2015. If these transactions were included, portfolio turnover would have been higher. |
See accompanying Notes to Financial Statements.
40 |
Financial Highlights(Continued)
Touchstone Small Company Fund
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||
Ended | ||||||||||||||||||||||||
June 30, 2019 | Year Ended December 31, | |||||||||||||||||||||||
(Unaudited) | 2018 | 2017 | 2016 | 2015 | 2014 | |||||||||||||||||||
Net asset value at beginning of period | $ | 12.69 | $ | 15.73 | $ | 13.58 | $ | 12.14 | $ | 14.63 | $ | 16.32 | ||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) | 0.01 | 0.01 | (0.01 | ) | 0.01 | (A) | (0.02 | )(A) | 0.07 | (A) | ||||||||||||||
Net realized and unrealized gains (losses) on investments | 1.88 | (1.11 | ) | 2.57 | 2.44 | (0.15 | ) | 1.03 | ||||||||||||||||
Total from investment operations | 1.89 | (1.10 | ) | 2.56 | 2.45 | (0.17 | ) | 1.10 | ||||||||||||||||
Distributions from: | ||||||||||||||||||||||||
Net investment income | — | — | (0.01 | ) | (0.01 | ) | — | (0.08 | ) | |||||||||||||||
Realized capital gains | — | (1.94 | ) | (0.40 | ) | (1.00 | ) | (2.32 | ) | (2.71 | ) | |||||||||||||
Total distributions | — | (1.94 | ) | (0.41 | ) | (1.01 | ) | (2.32 | ) | (2.79 | ) | |||||||||||||
Net asset value at end of period | $ | 14.58 | $ | 12.69 | $ | 15.73 | $ | 13.58 | $ | 12.14 | $ | 14.63 | ||||||||||||
Total return(B) | 14.89 | %(C) | (7.98 | %) | 19.12 | % | 20.23 | % | (1.34 | %) | 6.68 | % | ||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 63,531 | $ | 57,884 | $ | 70,339 | $ | 67,102 | $ | 48,938 | $ | 57,935 | ||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||
Net expenses | 0.76 | %(D) | 0.76 | % | 0.76 | % | 0.76 | % | 0.78 | % | 0.78 | % | ||||||||||||
Gross expenses | 0.83 | %(D) | 0.84 | % | 0.76 | % | 0.76 | % | 0.78 | % | 0.78 | % | ||||||||||||
Net investment income (loss) | 0.14 | %(D) | 0.05 | % | (0.06 | %) | 0.08 | % | (0.10 | %) | 0.45 | % | ||||||||||||
Portfolio turnover rate | 49 | %(C) | 68 | % | 68 | % | 68 | % | 77 | % | 72 | % |
Touchstone Aggressive ETF Fund
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||
Ended | ||||||||||||||||||||||||
June 30, 2019 | Year Ended December 31, | |||||||||||||||||||||||
(Unaudited) | 2018 | 2017 | 2016 | 2015 | 2014 | |||||||||||||||||||
Net asset value at beginning of period | $ | 14.75 | $ | 16.83 | $ | 14.60 | $ | 13.73 | $ | 13.98 | $ | 13.28 | ||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||
Net investment income | 0.14 | 0.29 | 0.30 | 0.30 | 0.22 | 0.21 | ||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 1.92 | (1.59 | ) | 2.22 | 0.79 | (0.23 | ) | 0.78 | ||||||||||||||||
Total from investment operations | 2.06 | (1.30 | ) | 2.52 | 1.09 | (0.01 | ) | 0.99 | ||||||||||||||||
Distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.29 | ) | (0.29 | ) | (0.22 | ) | (0.24 | ) | — | ||||||||||||||
Realized capital gains | — | (0.49 | ) | — | — | — | (0.29 | ) | ||||||||||||||||
Total distributions | — | (0.78 | ) | (0.29 | ) | (0.22 | ) | (0.24 | ) | (0.29 | ) | |||||||||||||
Net asset value at end of period | $ | 16.81 | $ | 14.75 | $ | 16.83 | $ | 14.60 | $ | 13.73 | $ | 13.98 | ||||||||||||
Total return(B) | 13.97 | %(C) | (7.84 | %) | 17.29 | % | 7.96 | % | (0.10 | %) | 7.49 | % | ||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 18,427 | $ | 16,894 | $ | 20,384 | $ | 19,514 | $ | 21,067 | $ | 24,099 | ||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||
Net expenses(E) | 0.75 | %(D) | 0.75 | % | 0.75 | % | 0.75 | % | 0.75 | % | 0.75 | % | ||||||||||||
Gross expenses(E) | 0.97 | %(D) | 0.92 | % | 0.90 | % | 0.90 | % | 0.87 | % | 0.87 | % | ||||||||||||
Net investment income | 1.62 | %(D) | 1.60 | % | 1.64 | % | 1.80 | % | 1.26 | % | 1.42 | % | ||||||||||||
Portfolio turnover rate | 13 | %(C) | 21 | % | 21 | % | 109 | % | 7 | % | 12 | % |
(A) | The net investment income (loss) per share was based on average shares outstanding for the period. |
(B) | Total returns do not include any insurance, sales or administrative charges of variable annuity or life insurance contracts. If these charges were included, the returns would be lower. |
(C) | Not annualized. |
(D) | Annualized. |
(E) | Ratio does not include expenses of the underlying funds. |
See accompanying Notes to Financial Statements.
41 |
Financial Highlights(Continued)
Touchstone Conservative ETF Fund
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||
Ended | ||||||||||||||||||||||||
June 30, 2019 | Year Ended December 31, | |||||||||||||||||||||||
(Unaudited) | 2018 | 2017 | 2016 | 2015 | 2014 | |||||||||||||||||||
Net asset value at beginning of period | $ | 10.87 | $ | 11.74 | $ | 12.18 | $ | 11.84 | $ | 12.68 | $ | 12.61 | ||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||
Net investment income | 0.14 | 0.23 | 0.23 | 0.29 | 0.17 | 0.18 | ||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 0.95 | (0.70 | ) | 0.99 | 0.37 | (0.20 | ) | 0.48 | ||||||||||||||||
Total from investment operations | 1.09 | (0.47 | ) | 1.22 | 0.66 | (0.03 | ) | 0.66 | ||||||||||||||||
Distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.21 | ) | (0.26 | ) | (0.19 | ) | (0.19 | ) | (0.15 | ) | |||||||||||||
Realized capital gains | — | (0.19 | ) | (1.40 | ) | (0.13 | ) | (0.62 | ) | (0.44 | ) | |||||||||||||
Total distributions | — | (0.40 | ) | (1.66 | ) | (0.32 | ) | (0.81 | ) | (0.59 | ) | |||||||||||||
Net asset value at end of period | $ | 11.96 | $ | 10.87 | $ | 11.74 | $ | 12.18 | $ | 11.84 | $ | 12.68 | ||||||||||||
Total return(A) | 10.03 | %(B) | (4.02 | %) | 10.06 | % | 5.58 | % | (0.24 | %) | 5.23 | % | ||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 16,884 | $ | 17,044 | $ | 16,831 | $ | 17,456 | $ | 19,964 | $ | 23,389 | ||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||
Net expenses(C) | 0.75 | %(D) | 0.75 | % | 0.75 | % | 0.75 | % | 0.75 | % | 0.75 | % | ||||||||||||
Gross expenses(C) | 0.99 | %(D) | 0.92 | % | 0.93 | % | 0.90 | % | 0.87 | % | 0.89 | % | ||||||||||||
Net investment income | 1.88 | %(D) | 2.05 | % | 1.82 | % | 1.78 | % | 1.13 | % | 1.20 | % | ||||||||||||
Portfolio turnover rate | 30 | %(B) | 38 | % | 31 | % | 109 | % | 9 | % | 13 | % |
Touchstone Moderate ETF Fund
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||
Ended | ||||||||||||||||||||||||
June 30, 2019 | Year Ended December 31, | |||||||||||||||||||||||
(Unaudited) | 2018 | 2017 | 2016 | 2015 | 2014 | |||||||||||||||||||
Net asset value at beginning of period | $ | 10.91 | $ | 12.26 | $ | 13.10 | $ | 13.33 | $ | 15.49 | $ | 14.72 | ||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||
Net investment income | 0.13 | 0.26 | 0.21 | 0.28 | 0.21 | 0.31 | ||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 1.19 | (0.99 | ) | 1.56 | 0.64 | (0.24 | ) | 0.72 | ||||||||||||||||
Total from investment operations | 1.32 | (0.73 | ) | 1.77 | 0.92 | (0.03 | ) | 1.03 | ||||||||||||||||
Distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.24 | ) | (0.25 | ) | (0.22 | ) | (0.27 | ) | (0.26 | ) | |||||||||||||
Realized capital gains | — | (0.38 | ) | (2.36 | ) | (0.93 | ) | (1.86 | ) | — | ||||||||||||||
Total distributions | — | (0.62 | ) | (2.61 | ) | (1.15 | ) | (2.13 | ) | (0.26 | ) | |||||||||||||
Net asset value at end of period | $ | 12.23 | $ | 10.91 | $ | 12.26 | $ | 13.10 | $ | 13.33 | $ | 15.49 | ||||||||||||
Total return(A) | 12.10 | %(B) | (6.02 | %) | 13.66 | % | 6.85 | % | (0.18 | %) | 6.96 | % | ||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 19,197 | $ | 18,659 | $ | 23,454 | $ | 24,641 | $ | 27,923 | $ | 33,200 | ||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||
Net expenses(C) | 0.75 | %(D) | 0.75 | % | 0.75 | % | 0.75 | % | 0.75 | % | 0.75 | % | ||||||||||||
Gross expenses(C) | 0.91 | %(D) | 0.87 | % | 0.84 | % | 0.82 | % | 0.80 | % | 0.79 | % | ||||||||||||
Net investment income | 1.75 | %(D) | 1.80 | % | 1.72 | % | 1.83 | % | 1.30 | % | 1.41 | % | ||||||||||||
Portfolio turnover rate | 19 | %(B) | 20 | % | 21 | % | 98 | % | 9 | % | 11 | % |
(A) | Total returns do not include any insurance, sales or administrative charges of variable annuity or life insurance contracts. If these charges were included, the returns would be lower. |
(B) | Not annualized. |
(C) | Ratio does not include expenses of the underlying funds. |
(D) | Annualized. |
See accompanying Notes to Financial Statements.
42 |
June 30, 2019 (Unaudited)
1. Organization
The Touchstone Variable Series Trust (the “Trust”) is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust was established as a Massachusetts business trust pursuant to an Agreement and Declaration of Trust dated February 7, 1994. The Trust consists of the following ten funds (individually, a “Fund”, and collectively, the “Funds”):
Touchstone Active Bond Fund (“Active Bond Fund”)
Touchstone Balanced Fund (“Balanced Fund”)
Touchstone Bond Fund (“Bond Fund”)
Touchstone Common Stock Fund (“Common Stock Fund”)
Touchstone Focused Fund (“Focused Fund”)
Touchstone Large Cap Core Equity Fund (“Large Cap Core Equity Fund”)
Touchstone Small Company Fund (“Small Company Fund”)
Touchstone Aggressive ETF Fund (“Aggressive ETF Fund”)
Touchstone Conservative ETF Fund (“Conservative ETF Fund”)
Touchstone Moderate ETF Fund (“Moderate ETF Fund”)
Each Fund is diversified with the exception of the Common Stock Fund, Focused Fund and the Large Cap Core Equity Fund which are non-diversified.
The Agreement and Declaration of Trust permits the Trust to issue an unlimited number of shares of beneficial interest of each Fund. Shares of beneficial interest of each Fund are available as a funding vehicle for the separate accounts of life insurance companies issuing variable annuity and variable life insurance policies. As of June 30, 2019, a majority of the outstanding shares of the Active Bond Fund, Focused Fund, Large Cap Core Equity Fund, Aggressive ETF Fund, Conservative ETF Fund and Moderate ETF Fund were issued to separate accounts of Western-Southern Life Assurance Company, The Western & Southern Life Insurance Company, Integrity Life Insurance Company, National Integrity Life Insurance Company, and Columbus Life Insurance Company, which are all part of Western & Southern Financial Group, Inc. (“Western & Southern”), and certain supplemental executive retirement plans sponsored by Western & Southern and its affiliates.
As of June 30, 2019 all Funds offer a single class of shares. The assets of each Fund are segregated, and a shareholder’s interest is limited to the Fund in which shares are held. The Funds’ prospectus provides a description of each Fund’s investment goal, policies, and strategies along with information on the class of shares currently being offered.
2. Significant Accounting Policies
The following is a summary of the Funds’ significant accounting policies:
Each Fund is an investment company that follows the accounting and reporting guidance of Accounting Standards Codification Topic 946 applicable to investment companies.
Security valuation and fair value measurements —U.S. generally accepted accounting principles (“U.S. GAAP”) define fair value as the price the Funds would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. All investments in securities are recorded at their fair value. The Funds define the term “market value”, as used throughout this report, as the estimated fair value. The Funds use various methods to measure fair value of their portfolio securities on a recurring basis. U.S. GAAP fair value measurement standards require disclosure of a hierarchy that prioritizes inputs to valuation methods.
These inputs are summarized in the three broad levels listed below:
· | Level 1 – | quoted prices in active markets for identical securities |
43 |
Notes to Financial Statements(Unaudited) (Continued)
· | Level 2 – | other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) |
· | Level 3 – | significant unobservable inputs (including a Fund’s own assumptions in determining the fair value of investments) |
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
The aggregate value by input level, as of June 30, 2019, for each Fund’s investments, is included in the Funds’ Portfolio of Investments, which also includes a breakdown of the Funds’ investments by portfolio or sector allocation. The Funds did not hold or transfer any Level 3 categorized securities during the six months ended June 30, 2019.
Changes in valuation techniques may result in transfers into or out of an investment’s assigned level within the hierarchy.
The Funds’ portfolio securities are valued as of the close of the regular session of trading on the New York Stock Exchange (“NYSE”) (currently 4:00 p.m., Eastern time or at the times as of which the NYSE establishes official closing prices). Portfolio securities traded on stock exchanges are valued at the last reported sale price, official close price, or last bid price if no sales are reported. Portfolio securities quoted by NASDAQ are valued at the NASDAQ Official Closing Price (“NOCP”) or from the primary exchange on which the security trades. To the extent these securities are actively traded, they are categorized in Level 1 of the fair value hierarchy. Options and futures are valued at the last quoted sales price. If there is no such reported sale on the valuation date, long option positions are valued at the most recent bid price, and short option positions are valued at the most recent ask price on the valuation date and are categorized in Level 1. Shares of mutual funds in which the Funds invest are valued at their respective net asset value (“NAV”) as reported by the underlying funds and are categorized in Level 1.
Debt securities held by the Funds are valued at their evaluated bid by an independent pricing service or at their last broker-quoted bid prices as obtained from one or more of the major market makers for such securities. Independent pricing services use information provided by market makers or estimates of market values through accepted market modeling conventions. Observable inputs to the models may include prepayment speeds, pricing spread, yield, trade information, dealer quotes, market color, cash flow models, the securities’ terms and conditions, among others, and are generally categorized in Level 2. Debt securities with remaining maturities of 60 days or less may be valued at amortized cost, provided such amount approximates market value and are categorized in Level 2. While this method provides consistency in valuation (and may only be used if it approximates market value), it may result in periods during which fair value, as determined by amortized cost, is higher or lower than the price that would be received if a Fund sold the investment.
Securities mainly traded on a non-U.S. exchange or denominated in foreign currencies are generally valued according to the preceding closing values on that exchange, translated to U.S. dollars using currency exchange rates as of the close of regular trading on the NYSE, and are generally categorized in Level 1. However, if an event that may change the value of a security occurs after the time that the closing value on the non-U.S. exchange was determined, but before the close of regular trading on the NYSE, the security may be priced based on fair value and is generally categorized in Level 2. This may cause the value of the security, if held on the books of a Fund, to be different from the closing value on the non-U.S. exchange and may affect the calculation of that Fund’s NAV.
The Funds may use fair value pricing under the following circumstances, among others:
44 |
Notes to Financial Statements(Unaudited) (Continued)
· | If the value of a security has been materially affected by events occurring before the Funds’ pricing time but after the close of the primary markets on which the security is traded. |
· | If the exchange on which a portfolio security is principally traded closes early or if trading in a particular portfolio security was halted during the day and did not resume prior to the Funds’ NAV calculation. |
· | If a security is so thinly traded that reliable market quotations are unavailable due to infrequent trading. |
· | If the validity of market quotations is not reliable. |
Securities held by the Funds that do not have readily available market quotations, significant observable inputs, or securities for which the available market quotations are not reliable, are priced at their estimated fair value using procedures approved by the Funds’ Board of Trustees and are generally categorized in Level 3.
Collateralized Loan Obligations —The Active Bond Fund may invest in collateralized loan obligations (“CLOs”). CLOs are types of asset-backed securities. A CLO is an entity that is backed by syndicated bank loans. The cash flows of the CLO can be split into multiple segments, called “tranches,” which will vary in risk profile and yield. The riskiest segment is the subordinated or “equity” tranche. This tranche bears the greatest risk of defaults from the underlying assets in the CLO and serves to protect the other, more senior, tranches from default in all but the most severe circumstances. Since it is shielded from defaults by the more junior tranches, a “senior” tranche will typically have higher credit ratings and lower yields than their underlying securities, and often receive higher ratings from one or more of the nationally recognized rating agencies. Despite the protection from the more junior tranches, senior tranches can experience substantial losses due to actual defaults, increased sensitivity to future defaults and the disappearance of one or more protecting tranches as a result of changes in the credit profile of the underlying pool of assets.
Investment companies —The Funds may invest in securities of other investment companies, including exchange-traded funds (“ETFs”), open-end funds and closed-end funds. Open-end funds are investment companies that issue new shares continuously and redeem shares daily. Closed-end funds are investment companies that typically issue a fixed number of shares that trade on a securities exchange or over-the-counter (“OTC”). An ETF is an investment company that typically seeks to track the performance of an index by holding in its portfolio shares of all the companies, or a representative sample of the companies, that are components of a particular index. ETF shares are traded on a securities exchange based on their market value. The risks of investment in other investment companies typically reflect the risks of the types of securities in which the other investment companies invest. Investments in ETFs and closed-end funds are subject to the additional risk that their shares may trade at a premium or discount to their NAV. When a Fund invests in another investment company, shareholders of the Fund indirectly bear their proportionate share of the other investment company’s fees and expenses, including operating, registration, trustee, licensing, and marketing, as well as their share of the Fund’s fees and expenses.
Futures Contracts —The Active Bond Fund and Bond Fund may buy and sell futures contracts and related options to manage its exposure to changing interest rates and securities prices. Some strategies reduce the Fund’s exposure to price fluctuations, while others tend to increase its market exposure. Futures and options on futures can be volatile instruments and involve certain risks that could negatively impact the Fund’s return. In order to avoid leveraging and related risks, when the Fund purchases futures contracts, it will collateralize its position by depositing an amount of cash or liquid securities, equal to the market value of the futures positions held, less margin deposits, in a segregated account with its custodian or otherwise “cover” its position in a manner consistent with the 1940 Act, or the rules of the Securities and Exchange Commission (the “SEC”) or interpretations thereunder. Collateral equal to the current fair value of the futures position will be determined on a daily basis.
When the contract is closed, the Fund records a realized gain or loss equal to the difference between the proceeds from (or cost of ) the closing transactions and the Fund’s basis in the contract. Risks of entering into futures contracts include the possibility that a change in the value of the contract may not correlate with the changes in the value of the underlying instruments. Second, it is possible that a lack of liquidity for futures contracts could exist in the secondary market resulting in an inability to close a futures position prior to its maturity date. Third, the purchase of a futures contract involves the risk that the Fund could lose more than the original margin deposit required to initiate the futures transaction. Finally, the risk exists that losses could exceed amounts disclosed on the Statements of Assets and Liabilities. There is minimal counterparty credit risk involved in entering into futures contracts since they are exchange-traded instruments and the exchange’s clearinghouse, as counterparty to all exchange-traded futures, guarantees the futures against default.
45 |
Notes to Financial Statements(Unaudited) (Continued)
As of June 30, 2019, Funds did not hold any futures contracts.
Foreign currency translation —The books and records of the Funds are maintained in U.S. dollars and translated into U.S. dollars on the following basis:
(1) | market value of investment securities, assets and liabilities at the current rate of exchange on the valuation date; and |
(2) | purchases and sales of investment securities, income, and expenses at the relevant rates of exchange prevailing on the respective dates of such transactions. |
The Funds do not isolate that portion of gains and losses on investments in equity securities that is due to changes in the foreign exchange rates from that which is due to changes in market prices of equity securities.
Real Estate Investment Trusts —The Funds may invest in real estate investment trusts (“REITs”) that involve risks not associated with investing in stocks. Risks associated with investments in REITs include declines in the value of real estate, general and economic conditions, changes in the value of the underlying property and defaults by borrowers. The value of assets in the real estate industry may go through cycles of relative underperformance and outperformance in comparison to equity securities markets in general. Dividend income is recorded using management’s estimate of the income included in distributions received from REIT investments. The actual amounts of income, return of capital and capital gains are only determined by each REIT after its fiscal year-end and may differ from the estimated amount. Estimates of income are adjusted in the Funds to the actual amounts when the amounts are determined.
Derivative instruments and hedging activities —The Active Bond Fund, Balanced Fund and Bond Fund may enter into an International Swaps and Derivatives Association, Inc. Master Agreement (“ISDA Master Agreement” or “MNA”) or similar agreement with certain counterparties. An ISDA Master Agreement is a bilateral agreement between the Fund and a counterparty that governs OTC derivatives and foreign exchange contracts, and typically contains, among other things, collateral posting terms and master netting provisions in the event of a default or termination. Under an ISDA Master Agreement, a party may, under certain circumstances, offset with the counterparty certain derivative financial instrument’s payables or receivables with collateral held or posted and create one single net payment. The provisions of the ISDA Master Agreement typically permit a single net payment in the event of default (close-out netting). These default events include bankruptcy or insolvency of the counterparty. Note, however, that bankruptcy or insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against the right of offset.
When entering into a derivative transaction, a Fund may be required to post and maintain collateral or margin (including both initial and maintenance margin). Collateral and margin requirements differ by type of derivative. Margin requirements are established by the broker or clearing house for exchange-traded and centrally cleared derivatives (financial futures contracts, options, and centrally cleared swaps). Brokers can ask for margining in excess of the clearing house’s minimum in certain circumstances. Collateral terms are contract specific for OTC derivatives (forward foreign currency contracts, options, and swaps). For derivatives traded under an ISDA Master Agreement, the collateral requirements are typically calculated by netting the marked-to-market amount for each transaction under such agreement and comparing that amount to the value of any collateral currently pledged by the Fund and the counterparty. For financial reporting purposes, cash collateral that has been pledged to cover obligations of the Fund and cash collateral received from the counterparty, if any, are reported separately on the Statements of Assets and Liabilities as cash deposits held at prime broker and due to prime broker, respectively. Non-cash collateral pledged by the Fund, if any, is noted in the Portfolio of Investments. To the extent amounts due to the Fund from its counterparties are not fully collateralized, contractually or otherwise, the Fund bears the risk of loss from counterparty non-performance.
46 |
Notes to Financial Statements(Unaudited) (Continued)
Certain ISDA Master Agreements allow counterparties to OTC derivatives transactions to terminate derivative contracts prior to maturity in the event a Fund’s net assets decline by a stated percentage or the Fund fails to meet the terms of its ISDA Master Agreement, which would cause the Fund (counterparty) to accelerate payment of any net liability owed to the counterparty (Fund).
For financial reporting purposes, the Funds do not offset derivative assets and derivative liabilities that are subject to netting arrangements in the Statements of Assets and Liabilities.
The following table sets forth the effect of the Funds’ derivative financial instruments by primary risk exposure on the Statements of Operations for the six months ended June 30, 2019:
The Effect of Derivative Investments on the Statements of Operations
for the Six Months Ended June 30, 2019
Change in | ||||||||||
Unrealized | ||||||||||
Realized Gain | Appreciation | |||||||||
Derivatives not accounted for as hedging | (Loss) | (Depreciation) | ||||||||
Fund | instruments under ASC 815 | on Derivatives | on Derivatives | |||||||
Active Bond Fund | Futures - Interest Rate Contracts* | $ | 59,306 | $ | 13,420 | |||||
Bond Fund | Futures - Interest Rate Contracts* | $ | 50,247 | $ | — |
* Statements of Operations Location: Net realized gains on futures contracts and net change in unrealized appreciation (depreciation) on futures contracts.
For the six months ended June 30, 2019, the average quarterly notional value of outstanding derivative financial instruments was as follows:
Active Bond | Bond | |||||||
Fund | Fund | |||||||
Interest rate contracts: | ||||||||
Futures - Notional value | $ | 9,814,927 | $ | 1,976,828 |
Portfolio securities loaned —The Funds may lend their portfolio securities. Lending portfolio securities exposes the Funds to the risk that the borrower may fail to return the loaned securities or may not be able to provide additional collateral or that the Funds may experience delays in recovery of the loaned securities or loss of rights in the collateral if the borrower fails financially. To minimize these risks, the borrower must agree to maintain cash collateral with the Funds’ custodian. The loaned securities are secured by collateral valued at least equal, at all times, to the market value of the loaned securities plus accrued interest, if any. When the collateral falls below specified amounts the lending agent will use its best effort to obtain additional collateral on the next business day to meet required amounts under the security lending agreement. The cash collateral is reinvested by the Funds’ custodian into an approved short-term investment vehicle. The approved short-term investment vehicle is subject to market risk.
As of June 30, 2019, the following Funds loaned securities and received collateral as follows:
47 |
Notes to Financial Statements(Unaudited) (Continued)
Market | Market | |||||||||||||
Value of | Value of | |||||||||||||
Securities | Collateral | Net | ||||||||||||
Fund | Security Type | Loaned* | Received** | Amount*** | ||||||||||
Small Company Fund | Common Stocks | 779,566 | 787,301 | 7,735 | ||||||||||
Conservative ETF Fund | Exchange-Traded Funds | 1,715,776 | 1,752,960 | 37,184 |
* | The remaining contractual maturity is overnight for all securities. |
** | Gross amount of recognized liabilities for securities lending included in the Statements of Assets and Liabilities. |
*** | Net amount represents the net amount payable due to the borrower in the event of default. |
All cash collateral is received, held, and administered by the Funds’ custodian for the benefit of the lending Fund in its custody account or other account established for the purpose of holding collateral in cash equivalents.
Funds participating in securities lending receive compensation in the form of fees. Securities lending income is derived from lending long securities from the Funds to creditworthy approved borrowers at rates that are determined based on daily trading volumes, float, short-term interest rates and market liquidity and is shown net of fees on the Statements of Operations. When a Fund lends securities, it retains the interest or dividends on the investment of any cash received as collateral, and the Fund continues to receive interest or dividends on the loaned securities.
Unrealized gain or loss on the market value of the loaned securities that may occur during the term of the loan is recognized by the Fund. The Fund has the right under the lending agreement to recover any loaned securities from the borrower on demand.
When-issued or delayed delivery transactions —Each Fund may purchase or sell securities on a when-issued or delayed delivery basis. These transactions involve a commitment by the Fund to purchase or sell securities for a predetermined price or yield, with payment and delivery taking place beyond the customary settlement period. When delayed delivery purchases are outstanding, the Fund will set aside liquid assets in an amount sufficient to meet the purchase price. When purchasing a security on a delayed delivery basis, the Fund assumes the rights and risks of ownership of the security, including the risk of price and yield fluctuations, and takes such fluctuations into account when determining NAV. The Fund may dispose of or renegotiate a delayed delivery transaction after it is entered into, and may sell when-issued securities before they are delivered, which may result in a capital gain or loss. When the Fund has sold a security on a delayed delivery basis, the Fund does not participate in future gains and losses with respect to the security.
Share valuation —The NAV per share of each Fund is calculated daily by dividing the total value of a Fund’s assets, less liabilities, by its number of outstanding shares.
Investment income —Dividend income from securities is recognized on the ex-dividend date, net of foreign withholding taxes, if any, which are reduced by any amounts reclaimable by the Funds, where applicable. Interest income from securities is recorded on the basis of interest accrued, premium amortized and discount accreted. Realized gains and losses resulting from principal paydowns on mortgage-backed and asset-backed securities are included in interest income. Market discounts, original issue discount and market premiums on debt securities are accreted/amortized to interest income over the life of the security with a corresponding adjustment in the cost basis of that security.
Distributions to shareholders —Each Fund intends to distribute to its shareholders substantially all of its income and capital gains. Each Fund declares and distributes net investment income, if any, annually, as a dividend to shareholders. Each Fund makes distributions of capital gains, if any, at least annually, net of applicable capital loss carryforwards. Income distributions and capital gain distributions are determined in accordance with income tax regulations. Recognition of the Funds’ net investment income from investments in underlying funds is affected by the timing of dividend declarations by the underlying funds.
48 |
Notes to Financial Statements(Unaudited) (Continued)
Allocations —Expenses not directly billed to a Fund are allocated proportionally among all the Funds in the Trust, and, if applicable, Touchstone Funds Group Trust, Touchstone Institutional Funds Trust and Touchstone Strategic Trust (collectively with the Trust, “Touchstone Fund Complex”), daily in relation to net assets of each Fund or another reasonable measure.
Security transactions —Security transactions are reflected for financial reporting purposes as of the trade date. Realized gains and losses on sales of portfolio securities are calculated using the identified cost basis.
Estimates —The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.
3. Investment Transactions
Investment transactions (excluding short-term investments and U.S. Government securities) were as follows for the six months ended June 30, 2019:
Active Bond | Balanced | Bond | Common Stock | |||||||||||||
Fund | Fund | Fund | Fund | |||||||||||||
Purchases of investment securities | $ | 6,450,377 | $ | 592,095 | $ | 4,172,823 | $ | 4,783,845 | ||||||||
Proceeds from sales and maturities | $ | 9,294,774 | $ | 1,794,710 | $ | 11,905,163 | $ | 13,531,098 | ||||||||
Large Cap | Small | |||||||||||||||
Focused | Core Equity | Company | Aggressive | |||||||||||||
Fund | Fund | Fund | ETF Fund | |||||||||||||
Purchases of investment securities | $ | 1,985,085 | $ | 2,813,850 | $ | 29,223,412 | $ | 2,200,686 | ||||||||
Proceeds from sales and maturities | $ | 5,103,731 | $ | 6,229,160 | $ | 32,749,487 | $ | 2,959,005 | ||||||||
Conservative | Moderate | |||||||||||||||
ETF Fund | ETF Fund | |||||||||||||||
Purchases of investment securities | $ | 4,981,530 | $ | 3,603,001 | ||||||||||||
Proceeds from sales and maturities | $ | 6,297,154 | $ | 5,251,215 |
For the six months ended June 30, 2019, purchases and proceeds from sales and maturities in U.S. Government Securities were $61,128,113 and $59,534,434, respectively, for the Active Bond Fund, $7,111,015 and $6,131,355, respectively, for the Balanced Fund, and $42,656,715 and $38,895,290, respectively, for the Bond Fund.
4. Transactions with Affiliates and Other Related Parties
Certain officers of the Trust are also officers of Touchstone Advisors, Inc. (the “Advisor”),Touchstone Securities, Inc. (the “Underwriter”), or The Bank of New York Mellon, the Sub-Administrator to the Funds, and BNY Mellon Investment Servicing (U.S.) Inc., the Transfer Agent to the Funds (collectively referenced to herein as “BNY Mellon”). Such officers receive no compensation from the Trust. The Advisor and the Underwriter are each wholly-owned subsidiaries of Western & Southern.
On behalf of the Funds, the Advisor pays each Independent Trustee a quarterly retainer plus additional retainers to the Lead Independent Trustee and the chairs of each standing committee. Interested Trustees do not receive compensation from the Funds. Each Independent Trustee also receives compensation for each board meeting and committee meeting attended. Each standing committee chair receives additional compensation for each committee meeting that he or she oversees. The Advisor is reimbursed by the Funds for the Independent Trustees’ compensation and out-of-pocket expenses relating to their services. The Funds accrued Trustee-related expenses of $73,810 for the six months ended June 30, 2019.
49 |
Notes to Financial Statements(Unaudited) (Continued)
MANAGEMENT & EXPENSE LIMITATION AGREEMENTS
The Advisor provides general investment supervisory services for the Funds, under the terms of an advisory agreement (the “Advisory Agreement”). Under the Advisory Agreement, each Fund pays the Advisor a fee, which is computed and accrued daily and paid monthly, at an annual rate based on average daily net assets of each Fund as shown in the table below.
Active Bond Fund | 0.40% on the first $300 million |
0.35% on such assets over $300 million | |
Balanced Fund | 0.55% on all assets |
Bond Fund | 0.40% on all assets |
Common Stock Fund | 0.50% on the first $200 million |
Small Company Fund | 0.45% on the next $300 million |
0.40% on such assets over $500 million | |
Focused Fund | 0.70% on the first $100 million |
0.65% on the next $400 million | |
0.60% on such assets over $500 million | |
Large Cap Core Equity Fund | 0.65% on the first $100 million |
0.60% on the next $100 million | |
0.55% on the next $100 million | |
0.50% on such assets over $300 million | |
Aggressive ETF Fund | 0.25% on the first $50 million |
Conservative ETF Fund | 0.23% on the next $50 million |
Moderate ETF Fund | 0.20% on such assets over $100 million |
The Advisor has entered into investment sub-advisory agreements with the following parties (each, a “Sub-Advisor”):
Fort Washington Investment Advisors, Inc.* | The London Company |
Active Bond Fund | Large Cap Core Equity Fund |
Balanced Fund | |
Bond Fund | Wilshire Associates Incorporated |
Common Stock Fund | Aggressive ETF Fund |
Focused Fund | Conservative ETF Fund |
Small Company Fund | Moderate ETF Fund |
* | Affiliate of the Advisor and wholly-owned subsidiary of Western & Southern. |
The Advisor pays sub-advisory fees to each Sub-Advisor from its advisory fee.
The Advisor entered into an expense limitation agreement (the “Expense Limitation Agreement”) to contractually limit the annual operating expenses of the Funds, excluding: dividend and interest expenses relating to short sales; interest; taxes; brokerage commissions and other transaction costs; portfolio transaction and investment related expenses, including expenses associated with the Funds’ liquidity provider; other expenditures which are capitalized in accordance with U.S. GAAP; the cost of “Acquired Fund Fees and Expenses”, if any; and other extraordinary expenses not incurred in the ordinary course of business. The maximum annual operating expense limit in any year with respect to the Funds is based on a percentage of the average daily net assets of the Funds. The Advisor has agreed to waive a portion of its fees, and to reimburse certain fund expenses in order to maintain the following expense limitations for the Funds:
50 |
Notes to Financial Statements(Unaudited) (Continued)
Fund | ||||
Active Bond Fund | 0.97 | % | ||
Balanced Fund | 0.85 | % | ||
Bond Fund | 0.67 | % | ||
Common Stock Fund | 0.73 | % | ||
Focused Fund | 1.21 | % | ||
Large Cap Core Equity Fund | 1.06 | % | ||
Small Company Fund | 0.76 | % | ||
Aggressive ETF Fund | 0.75 | % | ||
Conservative ETF Fund | 0.75 | % | ||
Moderate ETF Fund | 0.75 | % |
These expense limitations will remain in effect for all Funds through at least April 29, 2020, except for Bond Fund and Common Stock Fund, which will remain in effect through at least July 30, 2020.
Investment | Administration | Shareholder | ||||||||||||||
Advisory | Fees | Servicing | ||||||||||||||
Fund | Fees Waived | Waived | Fees Waived | Total | ||||||||||||
Balanced Fund | $ | 25,000 | $ | 12,522 | $ | — | $ | 37,522 | ||||||||
Bond Fund | 25,668 | 29,054 | — | 54,722 | ||||||||||||
Common Stock Fund | — | 54,841 | — | 54,841 | ||||||||||||
Focused Fund | — | 4,825 | — | 4,825 | ||||||||||||
Large Cap Core Equity Fund | — | 19,191 | 2,438 | 21,629 | ||||||||||||
Small Company Fund | — | 22,990 | — | 22,990 | ||||||||||||
Aggressive ETF Fund | — | 12,980 | 6,293 | 19,273 | ||||||||||||
Conservative ETF Fund | — | 12,114 | 7,936 | 20,050 | ||||||||||||
Moderate ETF Fund | — | 14,109 | 1,072 | 15,181 |
Under the terms of the Expense Limitation Agreement, the Advisor is entitled to recover, subject to approval by the Funds’ Board, such amounts waived or reimbursed for a period of up to three years from the date on which the Advisor reduced its compensation or assumed expenses for the Funds. A Fund will make repayments to the Advisor only if such repayment does not cause the Fund’s operating expenses (after the repayment is taken into account) to exceed the Fund’s expense limit in place when such amounts were waived or reimbursed by the Advisor and the Fund’s current expense limitation.
As of June 30, 2019, the Advisor may seek recoupment of previously waived fees and reimbursed expenses as follows:
Expires on or | Expires on or | Expires on or | Expires on or | |||||||||||||||||
before | before | before | before | |||||||||||||||||
December 31, | December 31, | December 31, | December 31, | |||||||||||||||||
Fund | 2019 | 2020 | 2021 | 2022 | Total | |||||||||||||||
Balanced Fund | $ | — | $ | 21,573 | $ | 52,697 | $ | 37,522 | $ | 111,792 | ||||||||||
Bond Fund | — | 13,965 | 90,383 | 54,722 | 159,070 | |||||||||||||||
Common Stock Fund | — | — | 142,925 | 54,841 | 197,766 | |||||||||||||||
Focused Fund | — | — | — | 4,825 | 4,825 | |||||||||||||||
Large Cap Core Equity Fund | 30,423 | 30,024 | 30,376 | 19,191 | 110,014 | |||||||||||||||
Small Company Fund | — | 538 | 57,315 | 22,990 | 80,843 | |||||||||||||||
Aggressive ETF Fund | 28,847 | 29,081 | 28,074 | 12,980 | 98,982 | |||||||||||||||
Conservative ETF Fund | 30,025 | 26,021 | 27,608 | 12,114 | 95,768 | |||||||||||||||
Moderate ETF Fund | 16,916 | 22,530 | 25,559 | 14,109 | 79,114 |
ADMINISTRATION AGREEMENT
The Advisor entered into an Administration Agreement with the Trust, whereby the Advisor is responsible for: supplying executive and regulatory compliance services; supervising the preparation of tax returns; coordinating the preparation of reports to shareholders and reports to, and filings with, the SEC and state securities authorities, as well as materials for meetings of the Board; calculating the daily NAV per share; and maintaining the financial books and records of each Fund.
51 |
Notes to Financial Statements(Unaudited) (Continued)
For its services, the Advisor’s annual administrative fee is:
0.145% on the first $20 billion of the aggregate average daily net assets;
0.11% on the next $10 billion of aggregate average daily net assets;
0.09% on the next $10 billion of aggregate average daily net assets; and
0.07% on the aggregate average daily net assets over $40 billion.
The fee is computed and allocated among the Touchstone Fund Complex (excluding Touchstone Institutional Funds Trust) on the basis of relative daily net assets.
The Advisor has engaged BNY Mellon as the Sub-Administrator to the Trust. BNY Mellon provides administrative and accounting services to the Trust and is compensated directly by the Advisor, not the Trust.
TRANSFER AGENT AGREEMENT
Under the terms of the Transfer Agent Agreement between the Trust and BNY Mellon, BNY Mellon maintains the records of each shareholder’s account, answers shareholders’ inquiries concerning their accounts, processes purchases and redemptions of each Fund’s shares, acts as dividend and distribution disbursing agent, and performs other shareholder service functions. For these services, BNY Mellon receives a monthly fee from each Fund. In addition, each Fund pays out-of-pocket expenses incurred by BNY Mellon, including, but not limited to, postage and supplies.
The Funds may reimburse the Advisor for fees paid to intermediaries such as banks, broker-dealers, financial advisors or other financial institutions for sub-transfer agency, sub-administration and other services provided to investors whose shares of record are held in omnibus, other group accounts, retirement plans or accounts traded through registered securities clearing agents. These fees may vary based on, for example, the nature of services provided, but generally range up to 0.15% of the assets of the class serviced or maintained by the intermediary or up to $22 per sub-account maintained by the intermediary.
PLANS OF DISTRIBUTION
The Trust has adopted a Shareholder Services Plan under which shares of each Fund, except for the Balanced Fund, Bond Fund, Common Stock Fund and Small Company Fund, may directly or indirectly bear expenses for shareholder services provided. Each Fund will incur or reimburse expenses for shareholder services at an annual rate not to exceed 0.25% of the average daily net assets.
UNDERWRITING AGREEMENT
The Underwriter acts as exclusive agent for the distribution of the Funds’ shares. The Underwriter receives no compensation under this agreement.
INTERFUND TRANSACTIONS
Pursuant to Rule 17a-7 under the 1940 Act, the Funds may engage in purchase and sale transactions with funds that have a common investment advisor (or affiliated investment advisors), common Trustees and/or common Officers. During the six months ended June 30, 2019, the Funds did not engage in any Rule 17a-7 transactions.
52 |
Notes to Financial Statements(Unaudited) (Continued)
5. Liquidity
Interfund Lending —Pursuant to an Exemptive Order issued by the SEC on March 28, 2017, the Funds, along with certain other funds in the Touchstone Fund Complex, may participate in an interfund lending program. The interfund lending program provides an alternate credit facility that allows the Funds to lend to or borrow from other participating funds in the Touchstone Fund Complex, subject to the conditions of the Exemptive Order. The Funds may not borrow under the facility for leverage purposes and the loans’ duration may be no more than 7 days.
During the six months ended June 30, 2019, the program was not utilized.
6. Federal Tax Information
Federal Income Tax —It is each Fund’s policy to continue to comply with the special provisions of the Internal Revenue Code applicable to regulated investment companies. As provided therein, in any fiscal year in which a Fund so qualifies and distributes at least 90% of its investment company taxable income, the Fund (but not the shareholders) will be relieved of federal income tax on the income distributed. It is each Fund’s policy to distribute all of its taxable income and accordingly, no provision for income taxes has been made.
The tax character of distributions paid for the years ended December 31, 2018 and 2017 is as follows:
Active Bond | Balanced | Bond | ||||||||||||||||||||||
Fund | Fund | Fund | ||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | 2018 | 2017 | |||||||||||||||||||
From ordinary income | $ | 1,215,721 | $ | 1,484,379 | $ | 249,571 | $ | — | $ | 1,019,953 | $ | — | ||||||||||||
From long-term capital gains | — | — | 4,676,219 | — | — | — | ||||||||||||||||||
Total distributions | $ | 1,215,721 | $ | 1,484,379 | $ | 4,925,790 | $ | — | $ | 1,019,953 | $ | — |
Common Stock | Focused | Large Cap | ||||||||||||||||||||||
Fund | Fund | Core Equity Fund | ||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | 2018 | 2017 | |||||||||||||||||||
From ordinary income | $ | 3,054,826 | $ | 17,544 | $ | 272,621 | $ | 319,068 | $ | 258,518 | $ | 215,126 | ||||||||||||
From long-term capital gains | 75,197,635 | 944,237 | 1,171,019 | — | 816,940 | 490,437 | ||||||||||||||||||
Total distributions | $ | 78,252,461 | $ | 961,781 | $ | 1,443,640 | $ | 319,068 | $ | 1,075,458 | $ | 705,563 |
Small | Aggressive | Conservative | Moderate | |||||||||||||||||||||||||||||
Company Fund | ETF Fund | ETF Fund | ETF Fund | |||||||||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||||||
From ordinary income | $ | 1,581,187 | $ | 193,590 | $ | 583,667 | $ | 351,189 | $ | 565,936 | $ | 492,618 | $ | 709,444 | $ | 608,441 | ||||||||||||||||
From long-term capital gains | 6,172,117 | 1,648,040 | 272,818 | — | 46,367 | 1,630,306 | 320,335 | 3,580,320 | ||||||||||||||||||||||||
Total distributions | $ | 7,753,304 | $ | 1,841,630 | $ | 856,485 | $ | 351,189 | $ | 612,303 | $ | 2,122,924 | $ | 1,029,779 | $ | 4,188,761 |
The following information is computed on a tax basis for each item as of December 31, 2018:
Balanced | Bond | |||||||||||
Active Bond Fund | Fund | Fund | ||||||||||
Tax cost of portfolio investments | $ | 55,949,028 | $ | 15,460,113 | $ | 42,585,121 | ||||||
Gross unrealized appreciation on investments | 338,658 | 1,707,355 | 68,527 | |||||||||
Gross unrealized depreciation on investments | (1,067,229 | ) | (1,191,186 | ) | (1,016,170 | ) | ||||||
Net unrealized appreciation (depreciation) on investments | (728,571 | ) | 516,169 | (947,643 | ) | |||||||
Net unrealized appreciation (depreciation) on derivatives and foreign currency transactions | 220 | — | — | |||||||||
Undistributed ordinary income | 1,435,298 | 229,302 | 1,256,747 | |||||||||
Undistributed long-term capital gains | — | 2,213 | — |
53 |
Notes to Financial Statements(Unaudited) (Continued)
Balanced | Bond | |||||||||||
Active Bond Fund | Fund | Fund | ||||||||||
Capital loss carryforwards | (2,362,180 | ) | — | (3,738,542 | ) | |||||||
Other temporary differences | (14,364 | ) | — | |||||||||
Distributable earnings (deficit) | $ | (1,669,597 | ) | $ | 747,684 | $ | (3,429,438 | ) |
Common Stock | Focused | Large Cap | ||||||||||
Fund | Fund | Core Equity Fund | ||||||||||
Tax cost of portfolio investments | $ | 115,077,105 | $ | 44,583,635 | $ | 23,224,566 | ||||||
Gross unrealized appreciation on investments | 21,585,938 | 10,827,286 | 3,755,033 | |||||||||
Gross unrealized depreciation on investments | (11,823,821 | ) | (4,276,853 | ) | (1,128,046 | ) | ||||||
Net unrealized appreciation (depreciation) on investments | 9,762,117 | 6,550,433 | 2,626,987 | |||||||||
Net unrealized appreciation (depreciation) on foreign currency | — | (205 | ) | — | ||||||||
Undistributed ordinary income | 2,958,913 | 214,618 | 210,592 | |||||||||
Undistributed long-term capital gains | 589,219 | 1,597,671 | 2,395,300 | |||||||||
Distributable earnings (deficit) | $ | 13,310,249 | $ | 8,362,517 | $ | 5,232,879 |
Small Company | Aggressive | Conservative | Moderate | |||||||||||||
Fund | ETF Fund | ETF Fund | ETF Fund | |||||||||||||
Tax cost of portfolio investments | $ | 54,105,954 | $ | 18,726,810 | $ | 18,871,702 | $ | 21,012,160 | ||||||||
Gross unrealized appreciation on investments | 7,640,557 | 878,731 | 648,500 | 731,188 | ||||||||||||
Gross unrealized depreciation on investments | (3,631,311 | ) | (474,911 | ) | (271,083 | ) | (561,559 | ) | ||||||||
Net unrealized appreciation (depreciation) on investments | 4,009,246 | 403,820 | 377,417 | 169,629 | ||||||||||||
Undistributed ordinary income | 749,335 | 310,116 | 407,801 | 395,726 | ||||||||||||
Undistributed long-term capital gains | 6,265,967 | 1,015,543 | 61,879 | 948,853 | ||||||||||||
Distributable earnings (deficit) | $ | 11,024,548 | $ | 1,729,479 | $ | 847,097 | $ | 1,514,208 |
The difference between the tax cost of portfolio investments and the financial statement cost is primarily due to wash sale loss deferrals and non-taxable distributions from corporate stock.
As of December 31 2018, the Funds had the following capital loss carryforwards for federal income tax purposes:
No | No | |||||||||||
Expiration | Expiration | |||||||||||
Short Term | Long Term | Total | ||||||||||
Active Bond Fund | $ | 631,131 | $ | 1,731,049 | $ | 2,362,180 | ||||||
Bond Fund | 1,499,349 | 2,239,193 | 3,738,542 |
The capital loss carryforwards may be utilized in future years to offset net realized capital gains, if any, prior to distributing such gains to shareholders.
Under current laws, certain capital losses realized after October 31 and ordinary losses realized after December 31 may be deferred (and certain ordinary losses after October and/or December 31 may be deferred) and treated as occurring on the first day of the following fiscal year. For the year ended December 31, 2018, the Funds did not elect to defer any losses.
The Funds have analyzed their tax positions taken or to be taken on federal income tax returns for all open tax years (tax years ended December 31, 2015 through 2018) and have concluded that no provision for income tax is required in their financial statements.
54 |
Notes to Financial Statements(Unaudited) (Continued)
As of June 30, 2019, the Trust had the following federal tax cost resulting in net unrealized appreciation (depreciation) as follows:
Gross | Gross | Gross | Gross | |||||||||||||||||||||
Unrealized | Unrealized | Unrealized | Unrealized | Net | ||||||||||||||||||||
Federal | Appreciation | Depreciation | Appreciation | Depreciation | Unrealized | |||||||||||||||||||
Tax | on | on | on | on | Appreciation | |||||||||||||||||||
Fund | Cost | Investments | Investments | Other* | Other* | (Depreciation) | ||||||||||||||||||
Active Bond Fund | $ | 56,331,592 | $ | 1,930,900 | $ | (116,070 | ) | $ | — | $ | — | $ | 1,814,830 | |||||||||||
Balanced Fund | 15,469,996 | 2,856,074 | (436,867 | ) | — | — | 2,419,207 | |||||||||||||||||
Bond Fund | 38,841,259 | 827,662 | (64,442 | ) | — | — | 763,220 | |||||||||||||||||
Common Stock Fund | 107,624,700 | 32,570,100 | (5,704,860 | ) | — | — | 26,865,240 | |||||||||||||||||
Focused Fund | 41,140,284 | 16,231,415 | (2,731,855 | ) | — | (149 | ) | 13,499,411 | ||||||||||||||||
Large Cap Core Equity Fund | 21,873,873 | 5,287,658 | (1,144,389 | ) | — | — | 4,143,269 | |||||||||||||||||
Small Company Fund | 53,488,111 | 12,179,259 | (1,493,448 | ) | — | — | 10,685,811 | |||||||||||||||||
Aggressive ETF Fund | 16,041,285 | 2,437,302 | (53,352 | ) | — | — | 2,383,950 | |||||||||||||||||
Conservative ETF Fund | 16,870,292 | 1,794,430 | (13,590 | ) | — | — | 1,780,840 | |||||||||||||||||
Moderate ETF Fund | 17,279,637 | 1,971,680 | (45,562 | ) | — | — | 1,926,118 |
* Other includes Foreign Currency Transactions.
7. Commitments and Contingencies
The Funds indemnify the Trust’s officers and Trustees for certain liabilities that might arise from their performance of their duties to the Funds. Additionally, in the normal course of business, the Funds enter into contracts that contain a variety of representations and warranties and which provide general indemnifications. The Funds’ maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Funds.
8. Principal Risks
Risks Associated with Foreign Investments —Some of the Funds may invest in the securities of foreign issuers. Investing in securities issued by companies whose principal business activities are outside the U.S. may involve significant risks not present in domestic investments. For example, there is generally less publicly available information about foreign companies, particularly those not subject to the disclosure and reporting requirements of the U.S. securities laws. Foreign issuers are generally not bound by uniform accounting, auditing, and financial reporting requirements and standards of practice comparable to those applicable to domestic issuers. Investments in foreign securities also involve the risk of possible adverse changes in investment or exchange control regulations, expropriation or confiscatory taxation, limitations on the removal of funds or other assets of a Fund, political or financial instability or diplomatic and other developments which could affect such investments. Foreign stock markets, while growing in volume and sophistication, are generally not as developed as those in the U.S., and securities of some foreign issuers (particularly those located in developing countries) may be less liquid and more volatile than securities of comparable U.S. companies. In general, there is less overall governmental supervision and regulation of foreign securities markets, broker-dealers, and issuers than in the U.S.
Risks Associated with Sector Concentration —Certain Funds may invest a high percentage of their assets in specific sectors of the market in order to achieve a potentially greater investment return. As a result, these Funds may be more susceptible to economic, political, and regulatory developments in a particular sector of the market, positive or negative, and may experience increased volatility in the Funds’ NAVs and magnified effect on the total return.
Risks Associated with Credit —An issuer may be unable to make timely payments of either principal or interest. This may cause the issuer’s securities to decline in value. Credit risk is particularly relevant to those Funds that invest a significant amount of their assets in junk bonds or lower-rated securities.
55 |
Notes to Financial Statements(Unaudited) (Continued)
Risks Associated with Interest Rate Changes —The price of debt securities is generally linked to the prevailing market interest rates. In general, when interest rates rise, the price of debt securities falls, and when interest rates fall, the price of debt securities rises. The price volatility of a debt security also depends on its maturity. Longer-term securities are generally more volatile, so the longer the average maturity or duration of these securities, the greater their price risk. Duration is a measure of the expected life, taking into account any prepayment or call features of the security, that is used to determine the price sensitivity of the security for a given change in interest rates. Specifically, duration is the change in the value of a fixed-income security that will result from a 1% change in interest rates, and generally is stated in years. For example, as a general rule a 1% rise in interest rates means a 1% fall in value for every year of duration. Maturity, on the other hand, is the date on which a fixed-income security becomes due for payment of principal. The negative impact on fixed income securities if interest rates increase as a result could negatively impact a Fund’s NAV.
Please see the Funds’ prospectus for a complete discussion of these and other risks.
9. Subsequent Events
Subsequent events occurring after the date of this report have been evaluated for potential impact to this report through the date the financial statements were issued.
At a meeting of the Board of Trustees (the “Board”) of the Trust held on February 12, 2019, the Board approved the reorganization of the Active Bond Fund into the Bond Fund, subject to shareholder approval. The reorganization was completed on July 12, 2019.
The Board also approved the reorganization of the Large Cap Core Equity Fund and the Focused Fund into the Common Stock Fund, subject to shareholder approval. The reorganization was completed on July 12, 2019.
There were no other subsequent events that necessitated recognition or disclosure in the Funds’ financial statements.
56 |
Proxy Voting Guidelines and Proxy Voting Records
The Sub-Advisors are responsible for exercising the voting rights associated with the securities purchased and held by the Funds. A description of the policies and procedures that the Sub-Advisors use in fulfilling this responsibility is available as an appendix to the most recent Statement of Additional Information, which can be obtained without charge by calling toll free 1.800.543.0407 or by visiting the Touchstone website at TouchstoneInvestments.com or on the Securities and Exchange Commission’s (the Commission) website at sec.gov. Information regarding how those proxies were voted during the most recent twelve-month period ended June 30, which will be filed by August 31 of that year is also available without charge by calling toll free 1.800.543.0407 or on the Commission’s website at sec.gov.
Quarterly Portfolio Disclosure
The Trust files a complete listing of portfolio holdings for each Fund as of the end of the first and third quarters of each fiscal year on Form N-PORT. The information will be publicly available 60 days after the end of the period. The complete listing of each Fund’s portfolio holdings is available on the Commission’s website and will be made available to shareholders upon request by calling 1.800.543.0407.
Schedule of Shareholder Expenses
As a shareholder of the Funds, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including investment advisory fees; shareholder servicing fees; and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds 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 (January 1, 2019 through June 30, 2019).
Actual Expenses
The first line of the table below for each Fund 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 the six months ended June 30, 2019” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line of the table below for each Fund provides information about hypothetical account values and hypothetical expenses based on the Funds’ actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Funds’ 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 Funds and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table below are meant to highlight your ongoing costs only and do not reflect any transactional costs. Therefore, the second line of the table below for each Fund is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.
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Other Items(Unaudited) (Continued)
Expenses | ||||||||||||||||
Net Expense | Beginning | Ending | Paid During | |||||||||||||
Ratio | Account | Account | the Six Months | |||||||||||||
Annualized | Value | Value | Ended | |||||||||||||
June 30, | January 1, | June 30, | June 30, | |||||||||||||
2019 | 2019 | 2019 | 2019* | |||||||||||||
Touchstone Active Bond Fund | ||||||||||||||||
Actual | 0.87 | % | $ | 1,000.00 | $ | 1,072.60 | $ | 4.47 | ||||||||
Hypothetical | 0.87 | % | $ | 1,000.00 | $ | 1,020.48 | $ | 4.36 | ||||||||
Touchstone Balanced Fund | ||||||||||||||||
Actual | 0.85 | % | $ | 1,000.00 | $ | 1,141.00 | $ | 4.51 | ||||||||
Hypothetical | 0.85 | % | $ | 1,000.00 | $ | 1,020.58 | $ | 4.26 | ||||||||
Touchstone Bond Fund | ||||||||||||||||
Actual | 0.67 | % | $ | 1,000.00 | $ | 1,078.40 | $ | 3.45 | ||||||||
Hypothetical | 0.67 | % | $ | 1,000.00 | $ | 1,021.47 | $ | 3.36 | ||||||||
Touchstone Common Stock Fund | ||||||||||||||||
Actual | 0.73 | % | $ | 1,000.00 | $ | 1,159.30 | $ | 3.91 | ||||||||
Hypothetical | 0.73 | % | $ | 1,000.00 | $ | 1,021.17 | $ | 3.66 | ||||||||
Touchstone Focused Fund | ||||||||||||||||
Actual | 1.21 | % | $ | 1,000.00 | $ | 1,152.00 | $ | 6.46 | ||||||||
Hypothetical | 1.21 | % | $ | 1,000.00 | $ | 1,018.79 | $ | 6.06 | ||||||||
Touchstone Large Cap Core Equity Fund | ||||||||||||||||
Actual | 1.06 | % | $ | 1,000.00 | $ | 1,134.70 | $ | 5.61 | ||||||||
Hypothetical | 1.06 | % | $ | 1,000.00 | $ | 1,019.54 | $ | 5.31 | ||||||||
Touchstone Small Company Fund | ||||||||||||||||
Actual | 0.76 | % | $ | 1,000.00 | $ | 1,148.90 | $ | 4.05 | ||||||||
Hypothetical | 0.76 | % | $ | 1,000.00 | $ | 1,021.03 | $ | 3.81 | ||||||||
Touchstone Aggressive ETF Fund** | ||||||||||||||||
Actual | 0.75 | % | $ | 1,000.00 | $ | 1,139.70 | $ | 3.98 | ||||||||
Hypothetical | 0.75 | % | $ | 1,000.00 | $ | 1,021.08 | $ | 3.76 | ||||||||
Touchstone Conservative ETF Fund** | ||||||||||||||||
Actual | 0.75 | % | $ | 1,000.00 | $ | 1,100.30 | $ | 3.91 | ||||||||
Hypothetical | 0.75 | % | $ | 1,000.00 | $ | 1,021.08 | $ | 3.76 | ||||||||
Touchstone Moderate ETF Fund** | ||||||||||||||||
Actual | 0.75 | % | $ | 1,000.00 | $ | 1,121.00 | $ | 3.94 | ||||||||
Hypothetical | 0.75 | % | $ | 1,000.00 | $ | 1,021.08 | $ | 3.76 |
* Expenses are equal to the Fund’s annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect one-half year period).
** The annualized expense ratio for the Fund does not include fees and expenses of the underlying funds in which the Fund invests.
58 |
We Respect Your Privacy
Thank you for your decision to invest with us. Touchstone and its affiliates have always placed a high value on the trust and confidence our clients place in us. We believe that confidence must be earned and validated through time. In today’s world, when technology allows the sharing of information at light speeds, trust must be reinforced by our sincere pledge to take the steps necessary to ensure that the information you share with us is treated with respect and confidentiality.
Our Pledge to Our Clients
· | We collect only the information we need to service your account and administer our business. |
· | We are committed to keeping your information confidential and we place strict limits and controls on the use and sharing of your information. |
· | We make every effort to ensure the accuracy of your information. |
We Collect the Following Nonpublic Personal Information About You:
· | Information we receive from you on or in applications or other forms, correspondence, or conversations, including, but not limited to, your name, address, phone number, social security number, assets, income and date of birth; and |
· | Information about your transactions with us, our affiliates, or others, including, but not limited to, your account number and balance, payment history, parties to transactions, cost basis information, and other financial information. |
Categories of Information We Disclose and Parties to Whom We Disclose
We do not disclose any nonpublic personal information about our current or former clients to nonaffiliated third parties, except as required or permitted by law.
We Place Strict Limits and Controls on the Use and Sharing of Your Information
· | We restrict access to nonpublic personal information about you to authorized employees who need the information to administer your business. |
· | We maintain physical, electronic and procedural safeguards that comply with federal standards to protect this information. |
· | We do not disclose any nonpublic personal information about our current or former clients to anyone, except as required or permitted by law or as described in this document. |
· | We will not sell your personal information to anyone. |
We May Provide Information to Service Your Account
Sometimes it is necessary to provide information about you to various companies such as transfer agents, custodians, broker-dealers and marketing service firms to facilitate the servicing of your account. These organizations have a legitimate business need to see some of your personal information in order for us to provide service to you. We may disclose to these various companies the information that we collect as described above. We require that these companies, including our own subsidiaries and affiliates, strictly maintain the confidentiality of this information and abide by all applicable laws. Companies within our corporate family that may receive this information are financial service providers and insurance companies. We do not permit these associated companies to sell the information for their own purposes, and we never sell our customer information.
This policy is applicable to the following affiliated companies: Touchstone Funds Group Trust, Touchstone Strategic Trust, Touchstone Variable Series Trust, Touchstone Institutional Funds Trust, Touchstone Securities, Inc.,* and W&S Brokerage Services, Inc.
* Touchstone Securities, Inc. serves as the underwriter to the Touchstone Funds.
A Member of Western & Southern Financial Group®
The Privacy Protection Policy is not part of the Semi-Annual Report.
59 |
TSF-1006-TVST-SAR-1906
Item 2. Code of Ethics.
Not applicable.
Item 3. Audit Committee Financial Expert.
Not applicable.
Item 4. Principal Accountant Fees and Services.
Not applicable.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Investments.
(a) | Schedule of Investments in securities of unaffiliated issuers as of the close of the reporting period is included as part of the report to shareholders filed under Item 1 of this form. |
(b) | Not applicable. |
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no material changes to the procedures by which the shareholders may recommend nominees to the registrant’s board of trustees, where those changes were implemented after the registrant last provided disclosure in response to the requirements of Item 407(c)(2)(iv) of Regulation S-K (17 CFR 229.407) (as required by Item 22(b)(15) of Schedule 14A (17 CFR 240.14a-101)), or this Item.
Item 11. Controls and Procedures.
(a) | The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph, based on their evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or 240.15d-15(b)). |
(b) | There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d))) that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting. |
Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.
Not applicable.
Item 13. Exhibits.
(a)(1) | Not applicable. |
(a)(2) | Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto. |
(a)(3) | Not applicable. |
(a)(4) | Not applicable. |
(b) | Certifications pursuant to Rule 30a-2(b) under the 1940 Act and Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Touchstone Variable Series Trust
By (Signature and Title)* /s/ Jill T. McGruder
Jill T. McGruder, President
(principal executive officer)
Date August 29, 2019
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By (Signature and Title)* /s/ Jill T. McGruder
Jill T. McGruder, President
(principal executive officer)
Date August 29, 2019
By (Signature and Title)* /s/ Terrie A. Wiedenheft
Terrie A. Wiedenheft, Controller and Treasurer
(principal financial officer)
Date August 29, 2019
* Print the name and title of each signing officer under his or her signature.