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Domini Social Equity Fund ®

Fund Information

$46.73
Daily Price (NAV)
as of 04/24/2015
Symbol DSEFX
Daily NAV Change $0.05 (0.11%)

Overview

Investor Shares Overview

Socially and environmentally concerned investors have social, as well as financial, objectives. The Domini Social Equity Fund seeks to meet these objectives by offering a diversified stock portfolio for long-term capital appreciation that is consistent with social and environmental priorities.

Investment Objective

The Fund seeks to provide its shareholders with long-term total return.

Investment Strategy

The Fund invests primarily in stocks of U.S. companies that meet Domini Social Investments’ social and environmental standards.

Subject to these standards, Wellington Management Company, LLP, the Fund’s subadvisor, seeks to add value using a diversified quantitative stock selection approach, while managing risk through portfolio construction.

Shareholder Activism

The Fund also advances its social and environmental objectives through proxy voting, dialogue with corporations, and the filing of shareholder resolutions

Social and Environmental Standards

Domini evaluates the Fund’s current and potential investments against its social and environmental standards based on the businesses in which they engage, as well as on the quality of their relations with key stakeholders, including communities, customers, ecosystems, employees, investors, and suppliers.

Domini may determine that a security is eligible for investment even if a corporation’s profile reflects a mixture of positive and negative social and environmental characteristics.

Investor Profile

Who Should Invest:

  • Investors seeking long-term growth of capital.
  • Investors committed to the Fund's socially responsible investment standards.

Who Should Not Invest:

  • Investors unwilling or unable to accept moderate to significant fluctuations in share price.

Performance

Investor Shares Performance


Month-End Returns as of 3/31/15
YTD1Yr3 Yr*5 Yr*10 Yr*Since Inception (6/3/91)*
DSEFX1.11%12.02%13.92%13.35%7.24%8.74%
S&P 5000.95%12.73%16.11%14.47%8.01%9.46%

Quarter-End Returns as of 3/31/15
YTD1Yr3 Yr*5 Yr*10 Yr*Since Inception (6/3/91)*
DSEFX1.11%12.02%13.92%13.35%7.24%8.74%
S&P 5000.95%12.73%16.11%14.47%8.01%9.46%

Calendar Year Returns
DSEFXS&P 500
201413.97%13.69%
201332.85%32.39%
201211.33%16.00%
20110.74%2.11%
201013.69%15.06%
200935.56%26.46%
2008-37.88%-37.00%
20071.46%5.50%
200612.58%15.79%
20052.03%4.91%
20049.26%10.88%
200327.13%28.69%
2002-20.69%-22.10%
2001-12.76%-11.88%
2000-15.05%-9.11%
199922.63%21.04%
199832.99%28.58%
199736.02%33.36%
199621.84%23.07%
199535.17%37.50%
1994-0.36%1.26%
19936.54%10.08%
199212.10%7.68%

Quarterly Returns
DSEFXS&P 500
1st Qtr 20151.11%0.95%
4th Qtr 20143.27%4.93%
3rd Qtr 20141.52%1.13%
2nd Qtr 20145.69%5.23%
1st Qtr 20142.86%1.81%
4th Qtr 20139.47%10.51%
3rd Qtr 20137.20%5.24%
2nd Qtr 20132.75%2.91%
1st Qtr 201310.19%10.61%

*Average annual total returns.

On 11/30/06, the Fund changed to an active management strategy. Past performance through 11/29/06 represents the former passive investment strategy, and is not indicative of future results.

Annual Expense Ratio: Gross: 1.20% / Net: 1.20%. Per current prospectus. Domini has contractually agreed to cap Investor share expenses to not exceed 1.25% until 11/30/15, subject to earlier modification by the Fund’s Board of Trustees. See prospectus for details. The Funds’ performance would have been lower had these fees not been waived.

Holdings

Ten Largest Holdings as of 3/31/15
COMPANY% OF PORTFOLIO
Apple Inc.5.9%
Microsoft Corp.3.7%
Intel Corp.2.8%
The Kroger Co.2.8%
Merck & Co. Inc.2.6%
Celgene Corp.2.5%
Consolidated Edison Inc.2.5%
Qualcomm Inc.2.5%
Kohls Corp.2.4%
Gilead Sciences Inc.2.3%
TOTAL30.0%

Sector Weightings as of 3/31/15
SECTOR% OF PORTFOLIO
Information Technology22.6%
Financials18.5%
Consumer Discretionary13.7%
Health Care13.2%
Industrials9.0%
Consumer Staples8.3%
Energy4.9%
Telecommunication Services3.8%
Materials3.5%
Utilities2.5%
Total100.0%

View the most recent quarterly holdings report filed with the Securities and Exchange Commission.

Characteristics

Portfolio Overview

Socially screened, mid- to large-capitalization domestic equity fund.

 

Investment Style:

Blend

Weighted Average Market Capitalization:

Large

Portfolio Statistics

  DSEFX S&P 500
Price-to-Earnings Ratio (projected) 14.2 16.3
Price-to-Book Ratio 2.2 2.8
Beta (projected) 1.04 --
R-squared (projected) 0.97 --
Market Cap Asset Weighted Avg. (Millions) $88,917 $132,242
Total Number of Holdings 145 500

All data as of 12/31/14 unless otherwise noted.

Definitions:

The Price/Earnings Ratio is a stock’s current price divided by the company’s trailing 12-month earnings per share. The Price/Book Ratio is used to compare a stock's market value to its book value. It is calculated by dividing the current closing price of the stock by the latest quarter's book value per share. The P/E and P/B ratio of a fund is the weighted average of the price/earnings and price/book ratios of the underlying stocks in a fund’s portfolio. 

R-squared measures how a fund’s performance correlates with a benchmark index’s performance and shows what portion of it can be explained by the performance of the overall market/index. R-squared ranges from  0, meaning no correlation, to 1, meaning perfect correlation.

Beta is a measure of the volatility of a fund relative to its benchmark index. A beta greater (less) than 1 is more (less) volatile than the index.

Commentary

Investor Shares Performance Commentary

The Fund is managed through a two-step process designed to capitalize on the strengths of Domini Social Investments and Wellington Management. Domini creates an approved list of companies based on its social, environmental and governance analysis, and Wellington then utilizes a systematic and disciplined process to manage the portfolio. Download Commentary as a PDF.

Total Returns as of December 31, 2014

  Oct
2014
Nov
2014
Dec
2014
4th Qtr
2014
YTD One
Year
Three
Year*
Five
Year*
Ten
Year*
Since Inception
(6/3/91)*
DSEFX 1.93% 2.02% -0.69% 3.27% 13.97% 13.97% 19.01% 14.06% 6.60% 8.78%
S&P 500 2.44% 2.69% -0.25% 4.93% 13.69% 13.69% 20.41% 15.45% 7.67% 9.52%

For the 12 months ended December 31, the Fund’s Investor shares returned 13.97%, outperforming the S&P 500 Index return of 13.69%.

Wellington Management uses a multi-factor model to select stocks for the portfolio that have been approved by Domini for investment. In 2014, the standout contributors to the Fund’s performance were Wellington’s capital management and momentum factors. Firms that returned excess capital or invested conservatively were rewarded with higher stock prices. Their counterparts—most notably capital-intensive energy companies—were penalized with lower stock prices stemming from the market’s perception of overinvestment and expectations of subpar returns on capital.

For the fourth quarter of 2014, the Fund’s Investor shares returned 3.27%, underperforming the S&P 500 Index return of 4.93%.

The Fund’s performance relative to the S&P 500 was hurt by negative stock selection in the energy, consumer discretionary and financials sectors. This was partially offset by positive security selection in the industrials, materials and consumer staples sectors.

The following portfolio holdings were the top positive contributors to the Fund’s relative performance:

  • Kroger Company, a U.S. supermarket retailer that returned nearly 24% for the quarter after positive third quarter earnings, driven by higher-margin organic and natural, as well as private label products, and performance that exceeded consensus expectations. 
  • Southwest Airlines, a passenger airline for U.S. and near-international markets that returned over 25% for the quarter after impressive third quarter results. The airline's "convenience" strategy (no bag/change fees and flight frequency) allowed it to gradually raise fares since 2000 without damaging its brand.
  • Con Edison Inc., a U.S. utility that returned nearly 18% for the quarter. 

The following portfolio holdings were the largest detractors to the Fund’s relative performance:  

  • Apache Corp., an American independent oil and gas exploration and production company that declined more than 33% in share value for the quarter due to a continued drop in oil prices worldwide. Additionally, OPEC’s decision not to place a quota cut on oil production to reduce oversupply put pressure on U.S. companies, including Apache, to cut spending.
  • National-Oilwell Varco, an international oilfield services provider whose stock fell more than 13% for the quarter.
  • Southwestern Energy, an American natural gas company whose share price declined nearly 22% for the quarter.

Making a Difference

Domini engages in direct dialogue with corporations in our portfolios and files shareholder proposals on a broad range of social, environmental, and corporate governance issues. Shareholder activism — the practice of active ownership — lies at the heart of what we believe responsible investing is all about. Here are a few ways your investment in the Domini Funds has made a difference. For more stories, click here.

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