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 811-02031
MFS SERIES TRUST V
(Exact name of registrant as specified in charter)
111 Huntington Avenue, Boston, Massachusetts 02199 (Address of principal executive offices) (Zip code)
Christopher R. Bohane
Massachusetts Financial Services Company
111Huntington Avenue Boston, Massachusetts 02199
(Name and address of agents for service)
Registrant's telephone number, including area code: (617) 954-5000
Date of fiscal year end: September 30
Date of reporting period: March 31, 2024
ITEM 1. REPORTS TO STOCKHOLDERS.
Item 1(a):
Semiannual Report
March 31, 2024
MFS® International New Discovery Fund
MFS® International New Discovery Fund
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The report is prepared for the general information of shareholders. It is authorized for distribution to prospective investors only when preceded or accompanied by a current prospectus.
NOT FDIC INSURED • MAY LOSE VALUE • NO BANK GUARANTEE
Portfolio structure
Top ten holdings
| NS Solutions Corp. | 1.6% |
| Symrise AG | 1.6% |
| OBIC Co. Ltd. | 1.3% |
| Dollarama, Inc. | 1.0% |
| Gerresheimer AG | 1.0% |
| T. Hasegawa Co. Ltd. | 0.9% |
| Cranswick PLC | 0.9% |
| Breedon Group PLC | 0.8% |
| Sodexo | 0.8% |
| Techtronic Industries Co. Ltd. | 0.8% |
GICS equity sectors (g)
| Industrials | 18.0% |
| Consumer Discretionary | 12.7% |
| Information Technology | 11.9% |
| Materials | 11.6% |
| Consumer Staples | 9.5% |
| Financials | 9.0% |
| Health Care | 6.8% |
| Communication Services | 5.5% |
| Real Estate | 4.5% |
| Energy | 2.7% |
| Utilities | 1.9% |
Issuer country weightings (x)
| Japan | 26.1% |
| United Kingdom | 11.9% |
| United States | 6.5% |
| Australia | 6.1% |
| Germany | 5.6% |
| France | 4.1% |
| Taiwan | 3.7% |
| India | 3.6% |
| Hong Kong | 3.2% |
| Other Countries | 29.2% |
Currency exposure weightings (y)
| Japanese Yen | 26.1% |
| Euro | 17.4% |
| British Pound Sterling | 12.2% |
| United States Dollar | 7.5% |
| Australian Dollar | 6.0% |
| Hong Kong Dollar | 5.3% |
| Taiwan Dollar | 3.7% |
| Indian Rupee | 3.1% |
| South Korean Won | 3.0% |
| Other Currencies | 15.7% |
Portfolio Composition - continued
| (g) | The Global Industry Classification Standard (GICS®) was developed by and/or is the exclusive property of MSCI, Inc. and S&P Global Market Intelligence Inc. (“S&P Global Market Intelligence”). GICS is a service mark of MSCI and S&P Global Market Intelligence and has been licensed for use by MFS. MFS has applied its own internal sector/industry classification methodology for equity securities and non-equity securities that are unclassified by GICS. |
| (x) | Represents the portfolio’s exposure to issuer countries as a percentage of a portfolio’s net assets. For purposes of this presentation, United States includes Cash & Cash Equivalents. |
| (y) | Represents the portfolio’s exposure to a particular currency as a percentage of a portfolio's net assets. For purposes of this presentation, United States Dollar includes Cash & Cash Equivalents. |
Cash & Cash Equivalents includes any cash, investments in money market funds, short-term securities, and other assets less liabilities. Please see the Statement of Assets and Liabilities for additional information related to the fund’s cash position and other assets and liabilities.
Percentages are based on net assets as of March 31, 2024.
The portfolio is actively managed and current holdings may be different.
Expense Table
Fund expenses borne by the shareholders during the period,
October 1, 2023 through March 31, 2024
As a shareholder of the fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on certain purchase or redemption payments, and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the fund 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 October 1, 2023 through March 31, 2024.
Actual Expenses
The first line for each share class in the following table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line for each share class in the following table provides information about hypothetical account values and hypothetical expenses based on the fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the fund 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 are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line for each share class in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Expense Table - continued
Share
Class | | Annualized
Expense
Ratio | Beginning
Account Value
10/01/23 | Ending
Account Value
3/31/24 | Expenses
Paid During
Period (p)
10/01/23-3/31/24 |
| A | Actual | 1.30% | $1,000.00 | $1,117.49 | $6.88 |
| Hypothetical (h) | 1.30% | $1,000.00 | $1,018.50 | $6.56 |
| B | Actual | 2.05% | $1,000.00 | $1,113.11 | $10.83 |
| Hypothetical (h) | 2.05% | $1,000.00 | $1,014.75 | $10.33 |
| C | Actual | 2.05% | $1,000.00 | $1,113.21 | $10.83 |
| Hypothetical (h) | 2.05% | $1,000.00 | $1,014.75 | $10.33 |
| I | Actual | 1.05% | $1,000.00 | $1,118.86 | $5.56 |
| Hypothetical (h) | 1.05% | $1,000.00 | $1,019.75 | $5.30 |
| R1 | Actual | 2.05% | $1,000.00 | $1,113.42 | $10.83 |
| Hypothetical (h) | 2.05% | $1,000.00 | $1,014.75 | $10.33 |
| R2 | Actual | 1.55% | $1,000.00 | $1,116.19 | $8.20 |
| Hypothetical (h) | 1.55% | $1,000.00 | $1,017.25 | $7.82 |
| R3 | Actual | 1.30% | $1,000.00 | $1,117.33 | $6.88 |
| Hypothetical (h) | 1.30% | $1,000.00 | $1,018.50 | $6.56 |
| R4 | Actual | 1.05% | $1,000.00 | $1,118.72 | $5.56 |
| Hypothetical (h) | 1.05% | $1,000.00 | $1,019.75 | $5.30 |
| R6 | Actual | 0.90% | $1,000.00 | $1,119.47 | $4.77 |
| Hypothetical (h) | 0.90% | $1,000.00 | $1,020.50 | $4.55 |
| (h) | 5% class return per year before expenses. |
| (p) | “Expenses Paid During Period” are equal to each class’s annualized expense ratio, as shown above, multiplied by the average account value over the period, multiplied by 183/366 (to reflect the one-half year period). Expenses paid do not include any applicable sales charges (loads). If these transaction costs had been included, your costs would have been higher. |
Portfolio of Investments
3/31/24 (unaudited)
The Portfolio of Investments is a complete list of all securities owned by your fund. It is categorized by broad-based asset classes.
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – 94.0% |
| Aerospace & Defense – 1.1% | |
| Babcock International Group PLC | | 1,393,969 | $9,148,869 |
| LISI Group | | 516,538 | 13,179,365 |
| MTU Aero Engines Holding AG | | 44,748 | 11,354,605 |
| Singapore Technologies Engineering Ltd. | | 12,838,800 | 38,224,015 |
| | | | | $71,906,854 |
| Airlines – 0.5% | |
| Enav S.p.A. | | 5,088,376 | $21,299,627 |
| Mainfreight Ltd. | | 304,373 | 12,674,781 |
| | | | | $33,974,408 |
| Alcoholic Beverages – 0.8% | |
| Carlsberg Group | | 160,595 | $22,003,609 |
| China Resources Beer Holdings Co. Ltd. | | 7,144,000 | 32,904,624 |
| | | | | $54,908,233 |
| Apparel Manufacturers – 0.9% | |
| Burberry Group PLC | | 511,400 | $7,829,472 |
| Coats Group PLC | | 5,250,030 | 5,373,950 |
| Eclat Textile Co. Ltd. | | 1,875,000 | 32,398,800 |
| Shenzhou International Group Holdings Ltd. | | 1,040,000 | 9,846,044 |
| | | | | $55,448,266 |
| Automotive – 2.0% | |
| ARB Corp. (l) | | 439,880 | $11,852,887 |
| Cie Plastic Omnium S.A. | | 319,197 | 4,159,937 |
| Daikyonishikawa Corp. | | 332,421 | 1,693,068 |
| Hero MotoCorp Ltd. | | 409,610 | 23,192,366 |
| Koito Manufacturing Co. Ltd. | | 1,291,600 | 21,629,053 |
| Mahindra & Mahindra Ltd. | | 922,321 | 21,247,582 |
| Niterra Co. Ltd. (l) | | 380,100 | 12,765,414 |
| Stanley Electric Co. Ltd. | | 577,931 | 10,746,966 |
| TS Tech Co. Ltd. (l) | | 997,300 | 13,245,288 |
| USS Co. Ltd. (l) | | 944,600 | 7,877,906 |
| | | | | $128,410,467 |
| Biotechnology – 0.1% | |
| Virbac S.A. | | 18,020 | $6,726,543 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Broadcasting – 0.5% | |
| 4imprint Group PLC | | 87,949 | $7,037,706 |
| Nippon Television Holdings, Inc. | | 630,300 | 9,657,688 |
| TBS Holdings, Inc. | | 550,900 | 15,863,213 |
| | | | | $32,558,607 |
| Brokerage & Asset Managers – 2.3% | |
| B3 S.A. - Brasil Bolsa Balcao | | 3,732,700 | $8,923,530 |
| Bolsa Mexicana de Valores S.A. de C.V. | | 7,293,600 | 16,241,636 |
| Euronext N.V. | | 252,458 | 24,022,533 |
| Hargreaves Lansdown PLC | | 1,312,899 | 12,196,076 |
| IPH Ltd. | | 7,236,284 | 29,754,959 |
| JAFCO Group Co. Ltd. (l) | | 197,100 | 2,448,451 |
| Moscow Exchange MICEX-RTS PJSC (a)(u) | | 7,428,305 | 0 |
| Omni Bridgeway Ltd. (a) | | 6,690,332 | 6,583,230 |
| Partners Group Holding AG | | 3,985 | 5,691,279 |
| Pinnacle Investment Management Group Ltd. | | 1,139,173 | 8,633,438 |
| Rathbones Group PLC | | 607,875 | 11,876,712 |
| TMX Group Ltd. | | 955,730 | 25,210,020 |
| | | | | $151,581,864 |
| Business Services – 6.3% | |
| Amadeus Fire AG | | 127,819 | $16,575,283 |
| Bunzl PLC | | 774,450 | 29,793,349 |
| Compass Group PLC | | 1,132,372 | 33,200,858 |
| Doshisha Co. Ltd. (l) | | 141,800 | 1,973,660 |
| Elis S.A. | | 132,746 | 3,016,066 |
| Eurofins Scientific SE | | 29,778 | 1,898,004 |
| Fullcast Holdings Co. Ltd. | | 747,500 | 7,105,645 |
| Gruppo Mutuionline S.p.A. | | 203,573 | 8,224,946 |
| Imdex Ltd. | | 12,787,030 | 19,415,117 |
| Intertek Group PLC | | 467,610 | 29,421,169 |
| Iwatani Corp. | | 367,000 | 20,708,905 |
| Johnson Service Group PLC | | 1,741,095 | 2,887,545 |
| Karnov Group AB (a) | | 1,032,083 | 6,373,383 |
| NS Solutions Corp. | | 3,111,400 | 101,534,655 |
| Pasona Group, Inc. | | 612,500 | 11,280,552 |
| RS Group PLC | | 4,605,992 | 42,252,175 |
| San-Ai Obbli Co. Ltd. (l) | | 3,112,500 | 42,931,034 |
| Sohgo Security Services Co. Ltd. | | 2,845,000 | 15,634,532 |
| TIS, Inc. | | 546,200 | 11,867,167 |
| | | | | $406,094,045 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Chemicals – 0.8% | |
| Borregaard ASA | | 387,981 | $6,761,480 |
| IMCD Group N.V. | | 129,334 | 22,792,550 |
| JCU Corp. | | 619,500 | 16,164,784 |
| KH Neochem Co. Ltd. | | 409,600 | 6,363,979 |
| | | | | $52,082,793 |
| Computer Software – 2.7% | |
| ARGO GRAPHICS, Inc. | | 688,500 | $19,557,075 |
| Douzone Bizon Co. Ltd. | | 447,057 | 14,378,881 |
| OBIC Co. Ltd. | | 551,300 | 82,942,644 |
| Oracle Corp. Japan | | 36,800 | 2,784,674 |
| PCA Corp. (h) | | 1,398,900 | 16,005,382 |
| Temairazu, Inc. | | 261,400 | 5,473,893 |
| Totvs S.A. | | 1,943,000 | 10,994,605 |
| Wisetech Global Ltd. | | 355,979 | 21,793,931 |
| | | | | $173,931,085 |
| Computer Software - Systems – 2.4% | |
| Alten S.A. | | 80,813 | $11,787,426 |
| Amadeus IT Group S.A. | | 448,964 | 28,790,645 |
| DTS Corp. (l) | | 783,500 | 20,806,381 |
| Elecom Co. Ltd. (l) | | 850,200 | 8,671,613 |
| Kardex Holding AG | | 100,319 | 28,142,936 |
| Pole To Win Holdings, Inc. (l) | | 1,706,900 | 5,818,209 |
| Toshiba Tec Corp. | | 209,700 | 4,211,177 |
| Venture Corp. Ltd. | | 4,200,900 | 44,396,847 |
| | | | | $152,625,234 |
| Conglomerates – 0.3% | |
| Ansell Ltd. | | 1,061,273 | $16,999,001 |
| Construction – 3.9% | |
| Bellway PLC | | 432,410 | $14,539,214 |
| Breedon Group PLC | | 11,221,667 | 54,458,377 |
| Fletcher Building Ltd. (l) | | 3,298,000 | 8,188,230 |
| Forterra PLC (h) | | 14,582,719 | 31,694,407 |
| Grupo Cementos de Chihuahua S.A.B. de C.V. | | 1,164,739 | 13,844,872 |
| James Hardie Industries PLC, GDR (a) | | 320,189 | 12,854,998 |
| Kingspan Group PLC | | 36,435 | 3,319,945 |
| Marshalls PLC | | 503,453 | 1,746,170 |
| PT Indocement Tunggal Prakarsa Tbk | | 24,754,200 | 13,661,258 |
| Reliance Worldwide Corp. | | 4,834,770 | 18,115,823 |
| Rinnai Corp. | | 269,700 | 6,207,126 |
| Techtronic Industries Co. Ltd. | | 3,818,000 | 51,756,098 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Construction – continued | |
| Zhejiang Supor Co. Ltd. | | 2,746,502 | $22,116,572 |
| | | | | $252,503,090 |
| Consumer Products – 1.5% | |
| Amorepacific Corp. | | 104,092 | $9,386,644 |
| Dabur India Ltd. | | 5,156,337 | 32,343,607 |
| Essity AB | | 864,312 | 20,525,795 |
| Kobayashi Pharmaceutical Co. Ltd. | | 348,700 | 11,736,204 |
| Lion Corp. | | 1,082,500 | 9,710,893 |
| Mitsubishi Pencil Co. Ltd. | | 176,700 | 2,980,018 |
| Pigeon Corp. | | 945,800 | 9,081,254 |
| PZ Cussons PLC | | 364,404 | 412,559 |
| | | | | $96,176,974 |
| Consumer Services – 1.9% | |
| Afya Ltd. (a) | | 300,419 | $5,581,785 |
| Asante, Inc. (l) | | 170,200 | 1,861,879 |
| Carsales.com Ltd. | | 623,600 | 14,661,791 |
| Heian Ceremony Service Co. | | 363,967 | 2,183,129 |
| Localiza Rent a Car S.A. | | 717,698 | 7,824,645 |
| Meitec Group Holdings, Inc. (l) | | 1,115,700 | 22,014,770 |
| Seek Ltd. | | 762,170 | 12,441,536 |
| Trip.com Group Ltd. (a) | | 778,481 | 34,334,365 |
| Webjet Ltd. (a)(l) | | 3,724,616 | 21,431,699 |
| | | | | $122,335,599 |
| Containers – 2.3% | |
| CCL Industries, Inc. | | 218,605 | $11,172,732 |
| Huhtamaki Oyj | | 615,309 | 25,776,368 |
| Mayr-Melnhof Karton AG (a) | | 133,652 | 16,639,579 |
| Toyo Seikan Group Holdings Ltd. | | 903,900 | 14,560,445 |
| Verallia | | 1,270,942 | 49,416,455 |
| Viscofan S.A. | | 372,627 | 23,678,309 |
| Winpak Ltd. | | 244,167 | 7,307,615 |
| | | | | $148,551,503 |
| Electrical Equipment – 2.5% | |
| Advantech Co. Ltd. | | 1,194,843 | $15,083,243 |
| Cembre S.p.A. | | 542,000 | 25,786,889 |
| Halma PLC | | 590,170 | 17,638,831 |
| Legrand S.A. | | 395,701 | 41,930,317 |
| LS Electric Co. Ltd. | | 461,221 | 33,505,971 |
| Sagami Rubber Industries Co. Ltd. | | 264,700 | 1,682,134 |
| TAKUMA Co. Ltd. | | 969,000 | 12,187,713 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Electrical Equipment – continued | |
| Voltronic Power Technology Corp. | | 292,659 | $14,997,133 |
| | | | | $162,812,231 |
| Electronics – 4.2% | |
| Amano Corp. | | 187,220 | $4,788,716 |
| ASM International N.V. | | 32,807 | 20,029,370 |
| ASM Pacific Technology Ltd. | | 3,681,000 | 46,277,632 |
| Chroma Ate, Inc. | | 4,346,000 | 34,628,400 |
| Fukui Computer Holdings, Inc. | | 205,100 | 3,518,594 |
| INTER ACTION Corp. | | 467,700 | 4,093,688 |
| Melexis N.V. | | 66,228 | 5,369,473 |
| Realtek Semiconductor Corp. | | 752,000 | 13,158,561 |
| Samsung Electro-Mechanics Co. Ltd. | | 289,020 | 31,923,695 |
| Silergy Corp. | | 1,629,000 | 16,695,424 |
| Silicon Motion Technology Corp., ADR | | 482,780 | 37,145,093 |
| Tripod Technology Corp. | | 3,260,000 | 20,831,159 |
| WIN Semiconductors Corp. | | 3,477,000 | 15,862,077 |
| Zuken, Inc. (l) | | 559,300 | 16,644,514 |
| | | | | $270,966,396 |
| Energy - Integrated – 0.5% | |
| Capricorn Energy PLC | | 171,560 | $378,936 |
| Galp Energia SGPS S.A., “B” | | 2,055,806 | 33,967,235 |
| | | | | $34,346,171 |
| Engineering - Construction – 1.1% | |
| Comsys Holdings Corp. (l) | | 160,900 | $3,771,127 |
| Corporacion Inmobiliaria Vesta S.A.B. de C.V. | | 3,931,298 | 15,340,209 |
| Doosan Bobcat, Inc. | | 423,959 | 16,785,155 |
| Prologis Property Mexico S.A. de C.V., REIT | | 2,397,347 | 10,492,404 |
| Technip Energies N.V. | | 974,883 | 24,621,526 |
| | | | | $71,010,421 |
| Entertainment – 1.5% | |
| CTS Eventim AG | | 557,849 | $49,621,328 |
| Lottery Corp. Ltd. | | 4,411,000 | 14,803,305 |
| Toei Co. Ltd. (l) | | 397,000 | 9,860,748 |
| Toho Co. Ltd. | | 605,800 | 19,801,152 |
| | | | | $94,086,533 |
| Food & Beverages – 6.5% | |
| ARIAKE JAPAN Co. Ltd. (l) | | 854,200 | $29,680,883 |
| AVI Ltd. | | 4,898,674 | 23,626,920 |
| Bakkafrost P/f | | 579,460 | 37,528,085 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Food & Beverages – continued | |
| Britvic PLC | | 1,256,810 | $13,039,244 |
| Cranswick PLC | | 1,076,808 | 55,668,459 |
| Ezaki Glico Co. Ltd. | | 390,900 | 10,930,636 |
| Greencore Group PLC (a) | | 1,183,806 | 1,782,510 |
| Gruma S.A.B. de C.V. | | 896,503 | 16,753,921 |
| Kato Sangyo Co. Ltd. | | 711,700 | 21,555,982 |
| Kerry Group PLC | | 206,732 | 17,717,727 |
| Morinaga & Co. Ltd. | | 1,538,000 | 26,674,719 |
| Orion Corp. | | 383,766 | 25,940,729 |
| S Foods, Inc. | | 841,000 | 18,611,111 |
| Shenguan Holdings Group Ltd. | | 13,203,505 | 497,647 |
| T. Hasegawa Co. Ltd. (h)(l) | | 2,782,000 | 55,684,106 |
| Takasago International Corp. | | 161,300 | 3,686,735 |
| Tate & Lyle PLC | | 376,983 | 2,938,121 |
| Tingyi (Cayman Islands) Holdings Corp. | | 13,534,000 | 14,836,234 |
| Toyo Suisan Kaisha Ltd. | | 286,400 | 17,926,014 |
| Universal Robina Corp. | | 11,928,240 | 22,343,568 |
| | | | | $417,423,351 |
| Food & Drug Stores – 1.3% | |
| DFI Retail Group Holdings Ltd. | | 6,359,109 | $13,672,084 |
| JM Holdings Co. Ltd. | | 253,700 | 4,682,506 |
| Nahdi Medical Co. | | 244,824 | 9,595,821 |
| Patlac Corp. | | 463,300 | 12,593,999 |
| SAN-A Co. Ltd. (l) | | 87,700 | 2,722,883 |
| Sendas Distribuidora S.A. | | 1,763,500 | 5,172,286 |
| Spencer's Retail Ltd. (a) | | 723,473 | 791,980 |
| Sugi Holdings Co. Ltd. | | 702,600 | 12,083,625 |
| Sundrug Co. Ltd. (l) | | 769,800 | 23,732,703 |
| | | | | $85,047,887 |
| Forest & Paper Products – 0.3% | |
| Sakata Seed Corp. | | 181,300 | $4,467,228 |
| Suzano S.A. | | 1,128,500 | 14,395,947 |
| | | | | $18,863,175 |
| Furniture & Appliances – 1.0% | |
| Howden Joinery Group PLC | | 2,074,398 | $23,741,851 |
| Paramount Bed Holdings Co. Ltd. | | 1,473,800 | 25,351,930 |
| SEB S.A. | | 121,712 | 15,573,246 |
| Zojirushi Corp. | | 177,300 | 1,693,591 |
| | | | | $66,360,618 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Gaming & Lodging – 0.7% | |
| Flutter Entertainment PLC (a) | | 90,036 | $17,943,588 |
| Sands China Ltd. (a) | | 3,191,200 | 8,990,272 |
| Shangri-La Asia Ltd. (a) | | 29,944,000 | 18,746,324 |
| | | | | $45,680,184 |
| General Merchandise – 1.6% | |
| B&M European Value Retail S.A. | | 5,246,020 | $36,138,860 |
| Dollarama, Inc. | | 841,907 | 64,136,712 |
| Seria Co. Ltd. | | 183,200 | 3,642,701 |
| | | | | $103,918,273 |
| Insurance – 2.3% | |
| Admiral Group PLC | | 212,870 | $7,622,278 |
| AUB Group Ltd. | | 1,891,898 | 36,665,118 |
| Hiscox Ltd. | | 1,978,378 | 30,962,922 |
| Samsung Fire & Marine Insurance Co. Ltd. | | 96,292 | 21,886,984 |
| Steadfast Group Ltd. | | 8,624,211 | 33,045,406 |
| Unipol Gruppo S.p.A. | | 1,962,447 | 16,442,066 |
| | | | | $146,624,774 |
| Internet – 1.9% | |
| Auto Trader Group PLC | | 792,394 | $7,002,841 |
| Digital Garage, Inc. | | 471,000 | 10,314,209 |
| Kakaku.com, Inc. | | 841,200 | 10,455,264 |
| MakeMyTrip Ltd. (a) | | 446,237 | 31,705,139 |
| Moneysupermarket.com Group PLC | | 4,259,033 | 11,815,434 |
| Proto Corp. | | 1,137,400 | 10,766,906 |
| Rightmove PLC | | 2,512,842 | 17,431,023 |
| Scout24 AG | | 270,024 | 20,351,293 |
| | | | | $119,842,109 |
| Leisure & Toys – 0.7% | |
| DeNA Co. Ltd. (l) | | 339,900 | $3,406,185 |
| Kawai Musical Instruments Manufacturing Co. Ltd. | | 119,800 | 2,845,033 |
| NCSoft Corp. | | 66,779 | 9,861,218 |
| Thule Group AB | | 330,181 | 9,954,168 |
| VTech Holdings Ltd. | | 3,136,965 | 19,017,617 |
| | | | | $45,084,221 |
| Machinery & Tools – 5.2% | |
| Aalberts Industries N.V. | | 151,503 | $7,288,191 |
| AirTAC International Group | | 822,000 | 28,766,854 |
| Azbil Corp. (l) | | 631,100 | 17,484,697 |
| Carel Industries S.p.A. | | 206,137 | 4,525,655 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Machinery & Tools – continued | |
| DAIFUKU Co. Ltd. | | 254,100 | $6,015,949 |
| Finning International, Inc. | | 353,723 | 10,395,860 |
| Fuji Seal International, Inc. | | 1,662,300 | 22,774,542 |
| Fujitec Co. Ltd. (l) | | 577,000 | 14,457,399 |
| Fukushima Galilei Co. Ltd. | | 578,300 | 22,539,107 |
| GEA Group AG | | 1,208,466 | 51,094,102 |
| Haitian International Holdings Ltd. | | 9,977,000 | 28,999,572 |
| Interpump Group S.p.A. | | 95,857 | 4,673,339 |
| METAWATER Co. Ltd. | | 870,600 | 13,187,249 |
| MISUMI Group, Inc. | | 225,900 | 3,081,540 |
| MonotaRO Co. Ltd. | | 1,165,500 | 13,993,237 |
| Nabtesco Corp. | | 815,900 | 13,797,754 |
| Nissei ASB Machine Co. Ltd. | | 151,400 | 5,320,703 |
| Obara Group, Inc. | | 128,500 | 3,225,657 |
| Rational AG | | 3,914 | 3,373,873 |
| Rotork PLC | | 2,206,516 | 9,156,929 |
| Seven Group Holdings Ltd. | | 980,316 | 26,044,811 |
| SIG Combibloc Group AG | | 520,290 | 11,538,282 |
| VAT Group AG | | 21,633 | 11,209,293 |
| | | | | $332,944,595 |
| Major Banks – 0.6% | |
| Kyoto Financial Group, Inc. (l) | | 2,005,100 | $36,570,756 |
| Medical & Health Technology & Services – 1.5% | |
| ARATA Corp. | | 296,800 | $6,470,075 |
| Arvida Group Ltd. | | 9,909,956 | 6,571,981 |
| AS ONE Corp. | | 883,200 | 15,495,965 |
| BML, Inc. | | 883,400 | 16,975,893 |
| Burning Rock Biotech Ltd., ADR (a) | | 285,384 | 208,102 |
| DKSH Holding Ltd. | | 45,850 | 3,119,030 |
| Guangzhou KingMed Diagnostics Group Co. Ltd., “A” | | 1,147,400 | 8,931,604 |
| Hapvida Participacoes e Investimentos S.A. (a) | | 7,727,600 | 5,700,865 |
| ICON PLC (a) | | 41,702 | 14,009,787 |
| Medipal Holdings Corp. | | 724,100 | 11,097,318 |
| Ryman Healthcare Ltd. (a) | | 2,130,319 | 5,791,054 |
| Selcuk Ecza Deposu Ticaret ve Sanayi A.S. | | 2,605,276 | 4,137,917 |
| | | | | $98,509,591 |
| Medical Equipment – 3.5% | |
| ConvaTec Group PLC | | 5,206,344 | $18,819,880 |
| Demant A.S. (a) | | 201,089 | 10,025,192 |
| Eiken Chemical Co. Ltd. (l) | | 949,700 | 12,547,232 |
| Fukuda Denshi Co. Ltd. | | 573,400 | 26,249,584 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Medical Equipment – continued | |
| Gerresheimer AG | | 547,554 | $61,672,070 |
| Nakanishi, Inc. | | 1,190,300 | 18,517,350 |
| Shimadzu Corp. (l) | | 624,700 | 17,455,945 |
| Smith & Nephew PLC | | 2,044,371 | 25,586,283 |
| Sonova Holding AG | | 84,161 | 24,365,956 |
| Straumann Holding AG | | 15,039 | 2,401,304 |
| Tecan Group AG | | 12,966 | 5,374,165 |
| | | | | $223,014,961 |
| Metals & Mining – 0.5% | |
| Iluka Resources Ltd. | | 2,312,804 | $10,866,470 |
| PT United Tractors Tbk | | 14,165,800 | 21,599,383 |
| | | | | $32,465,853 |
| Natural Gas - Distribution – 1.1% | |
| China Resources Gas Group Ltd. | | 6,976,000 | $22,237,565 |
| DCC PLC | | 224,073 | 16,290,072 |
| Italgas S.p.A. | | 5,939,723 | 34,603,579 |
| | | | | $73,131,216 |
| Natural Gas - Pipeline – 0.2% | |
| APA Group | | 2,924,114 | $16,025,246 |
| Network & Telecom – 0.2% | |
| NOHMI BOSAI Ltd. | | 678,100 | $10,280,351 |
| Oil Services – 1.3% | |
| ADNOC Drilling Co. PJSC | | 9,975,494 | $10,784,318 |
| JGC Holdings Corp. | | 2,548,900 | 25,088,261 |
| Samsung Engineering Co. Ltd. (a) | | 1,614,410 | 29,979,759 |
| Tenaris S.A., ADR | | 436,499 | 17,141,316 |
| | | | | $82,993,654 |
| Other Banks & Diversified Financials – 4.3% | |
| Abu Dhabi Islamic Bank PJSC | | 2,566,770 | $7,702,582 |
| AEON Financial Service Co. Ltd. | | 2,490,600 | 23,107,727 |
| AEON Thana Sinsap Public Co. Ltd. | | 2,563,700 | 10,960,937 |
| Allfunds Group PLC | | 917,818 | 6,629,308 |
| Banco Santander Chile S.A. | | 158,001,165 | 7,869,660 |
| Chiba Bank Ltd. (l) | | 1,178,551 | 9,821,258 |
| Credicorp Ltd. | | 70,794 | 11,994,627 |
| E.Sun Financial Holding Co. Ltd. | | 12,818,678 | 10,914,712 |
| Federal Bank Ltd. | | 8,385,754 | 15,101,948 |
| FinecoBank S.p.A. | | 1,128,619 | 16,906,524 |
| Hachijuni Bank Ltd. (l) | | 3,710,800 | 25,493,672 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Other Banks & Diversified Financials – continued | |
| Iress Ltd. (a) | | 1,560,926 | $8,432,401 |
| Julius Baer Group Ltd. | | 218,037 | 12,591,193 |
| Komercni Banka A.S. | | 465,360 | 16,666,698 |
| Metropolitan Bank & Trust Co. | | 27,226,417 | 31,643,204 |
| Shizuoka Financial Group, Inc. (l) | | 3,357,100 | 32,089,600 |
| Shriram Transport Finance Ltd. | | 792,064 | 22,410,751 |
| Zenkoku Hosho Co. Ltd. (l) | | 180,300 | 6,551,924 |
| | | | | $276,888,726 |
| Pharmaceuticals – 1.5% | |
| Daito Pharmaceutical Co. Ltd. | | 696,190 | $10,779,954 |
| Hypera S.A. | | 737,124 | 4,839,792 |
| Ipca Laboratories Ltd. | | 2,191,545 | 32,514,826 |
| Kalbe Farma Tbk PT | | 224,705,600 | 20,904,495 |
| Santen Pharmaceutical Co. Ltd. (l) | | 1,547,200 | 15,704,008 |
| Suzuken Co. Ltd./Aichi Japan (l) | | 339,200 | 10,394,694 |
| | | | | $95,137,769 |
| Pollution Control – 0.8% | |
| ALS Ltd. | | 1,637,580 | $14,011,404 |
| Daiseki Co. Ltd. | | 1,584,940 | 38,162,943 |
| | | | | $52,174,347 |
| Precious Metals & Minerals – 0.6% | |
| Agnico Eagle Mines Ltd. | | 667,756 | $39,817,395 |
| Printing & Publishing – 0.4% | |
| China Literature Ltd. (a) | | 2,235,200 | $7,467,897 |
| Wolters Kluwer N.V. | | 108,148 | 16,941,278 |
| | | | | $24,409,175 |
| Railroad & Shipping – 0.3% | |
| Sankyu, Inc. (l) | | 610,100 | $21,045,992 |
| Real Estate – 3.8% | |
| Aldar Properties PJSC | | 9,738,995 | $14,798,446 |
| Big Yellow Group PLC, REIT | | 1,000,371 | 13,434,258 |
| CapitaLand India Trusts IEU, REIT | | 22,830,059 | 17,753,425 |
| CapitaLand Investment Ltd. | | 14,607,900 | 28,994,017 |
| Cedar Woods Properties Ltd. | | 2,256,844 | 7,059,227 |
| City Developments Ltd. | | 2,898,600 | 12,558,274 |
| Embassy Office Parks REIT | | 3,371,200 | 14,939,951 |
| LEG Immobilien SE | | 531,075 | 45,595,382 |
| Midland Holdings Ltd. (a)(h) | | 43,113,000 | 5,398,145 |
| Rural Funds Group, REIT | | 5,967,623 | 8,127,595 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Real Estate – continued | |
| Shaftesbury Capital PLC, REIT | | 4,450,039 | $8,104,778 |
| Swire Properties Ltd. | | 11,967,000 | 25,136,067 |
| TAG Immobilien AG (a) | | 253,019 | 3,459,889 |
| Unite Group PLC, REIT | | 3,147,607 | 38,853,517 |
| | | | | $244,212,971 |
| Restaurants – 2.2% | |
| Cafe de Coral Holdings Ltd. | | 16,092,000 | $16,468,451 |
| Domino's Pizza Enterprises Ltd. | | 412,886 | 11,674,390 |
| Greggs PLC | | 1,220,373 | 44,268,044 |
| Pluxee N.V. (a) | | 591,892 | 17,496,618 |
| Sodexo | | 608,323 | 52,161,871 |
| | | | | $142,069,374 |
| Specialty Chemicals – 4.4% | |
| Air Water, Inc. | | 783,300 | $12,392,677 |
| Croda International PLC | | 677,375 | 41,909,593 |
| Essentra PLC | | 12,777,311 | 28,351,061 |
| Japan Pure Chemical Co. Ltd. | | 41,700 | 840,170 |
| Kureha Corp. (l) | | 411,000 | 7,376,714 |
| Nihon Parkerizing Co. Ltd. | | 1,049,600 | 8,542,127 |
| Nitto Denko Corp. (l) | | 77,000 | 7,009,248 |
| NOF Corp. | | 960,000 | 13,225,525 |
| Sika AG | | 89,775 | 26,737,889 |
| SK KAKEN Co. Ltd. | | 590,500 | 30,660,127 |
| Symrise AG | | 835,071 | 99,956,670 |
| Taisei Lamick Co. Ltd. | | 219,800 | 4,332,694 |
| | | | | $281,334,495 |
| Specialty Stores – 1.8% | |
| Just Eat Takeaway.com (a) | | 823,542 | $12,205,915 |
| Just Eat Takeaway.com (a)(l) | | 75,723 | 1,124,903 |
| Kitanotatsujin Corp. (l) | | 1,132,600 | 1,541,258 |
| Multiplan Empreendimentos Imobiliarios S.A. | | 3,773,398 | 19,252,952 |
| Nick Scali Ltd. | | 1,081,696 | 10,855,263 |
| Nishimatsuya Chain Co. Ltd. | | 1,316,100 | 21,630,709 |
| Shimamura Co. Ltd. | | 105,600 | 6,044,550 |
| ZOZO, Inc. | | 1,689,900 | 42,487,511 |
| | | | | $115,143,061 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Telecommunications - Wireless – 1.3% | |
| Cellnex Telecom S.A. | | 1,421,081 | $50,240,777 |
| Etihad Etisalat Co. | | 1,366,462 | 19,091,483 |
| Infrastrutture Wireless Italiane S.p.A. | | 1,249,006 | 14,189,071 |
| | | | | $83,521,331 |
| Telephone Services – 0.4% | |
| Helios Towers PLC (a) | | 3,910,243 | $4,683,612 |
| Hellenic Telecommunications Organization S.A. | | 1,037,138 | 15,295,587 |
| NOS, SGPS S.A. | | 2,166,413 | 8,474,813 |
| | | | | $28,454,012 |
| Trucking – 1.0% | |
| Freightways Group Ltd. | | 2,282,376 | $12,067,909 |
| Hamakyorex Co. Ltd. | | 114,900 | 2,922,216 |
| Seino Holdings Co. Ltd. | | 1,375,400 | 19,216,349 |
| SG Holdings Co. Ltd. | | 1,043,800 | 13,121,624 |
| Trancom Co. Ltd. | | 95,100 | 3,788,169 |
| Yamato Holdings Co. Ltd. | | 844,600 | 12,040,209 |
| | | | | $63,156,476 |
| Utilities - Electric Power – 0.6% | |
| CESC Ltd. | | 25,341,562 | $36,962,933 |
| Utilities - Water – 0.1% | |
| Aguas Andinas S.A., “A” | | 27,285,184 | $7,964,688 |
| Total Common Stocks (Identified Cost, $5,106,645,305) | | $6,057,109,878 |
| Preferred Stocks – 0.1% |
| Metals & Mining – 0.1% | | | | |
| Gerdau S.A. (Identified Cost, $4,884,128) | | 1,474,525 | $6,526,788 |
| Investment Companies (h) – 5.3% |
| Money Market Funds – 5.3% | |
| MFS Institutional Money Market Portfolio, 5.38% (v) (Identified Cost, $344,256,431) | | | 344,252,428 | $344,321,279 |
| Collateral for Securities Loaned – 0.3% |
| JPMorgan U.S. Government Money Market Fund - Class IM Shares, 5.25% (j) (Identified Cost, $18,971,656) | | | 18,971,656 | $18,971,656 |
|
|
| Other Assets, Less Liabilities – 0.3% | | 17,183,471 |
| Net Assets – 100.0% | $6,444,113,072 |
| (a) | Non-income producing security. | | | |
Portfolio of Investments (unaudited) – continued
| (h) | An affiliated issuer, which may be considered one in which the fund owns 5% or more of the outstanding voting securities, or a company which is under common control. At period end, the aggregate values of the fund's investments in affiliated issuers and in unaffiliated issuers were $453,103,319 and $5,973,826,282, respectively. | | | |
| (j) | The rate quoted is the annualized seven-day yield of the fund at period end. | | | |
| (l) | A portion of this security is on loan. See Note 2 for additional information. | | | |
| (u) | The security was valued using significant unobservable inputs and is considered level 3 under the fair value hierarchy. For further information about the fund’s level 3 holdings, please see Note 2 in the Notes to Financial Statements. | | | |
| (v) | Affiliated issuer that is available only to investment companies managed by MFS. The rate quoted for the MFS Institutional Money Market Portfolio is the annualized seven-day yield of the fund at period end. | | | |
| The following abbreviations are used in this report and are defined: |
| ADR | American Depositary Receipt |
| GDR | Global Depositary Receipt |
| IEU | International Equity Unit |
| REIT | Real Estate Investment Trust |
See Notes to Financial Statements
Financial Statements
Statement of Assets and Liabilities
At 3/31/24 (unaudited)
This statement represents your fund’s balance sheet, which details the assets and liabilities comprising the total value of the fund.
| Assets | |
| Investments in unaffiliated issuers, at value, including $120,038,716 of securities on loan (identified cost, $5,002,575,250) | $5,973,826,282 |
| Investments in affiliated issuers, at value (identified cost, $472,182,270) | 453,103,319 |
| Cash | 4,104,526 |
| Foreign currency, at value (identified cost, $488,589) | 488,645 |
| Receivables for | |
| Investments sold | 7,609,974 |
| Fund shares sold | 3,917,594 |
| Interest and dividends | 33,860,060 |
| Other assets | 20,208 |
| Total assets | $6,476,930,608 |
| Liabilities | |
| Payables for | |
| Fund shares reacquired | $2,629,967 |
| Collateral for securities loaned, at value (c) | 18,971,656 |
| Payable to affiliates | |
| Investment adviser | 753,092 |
| Administrative services fee | 8,421 |
| Shareholder servicing costs | 611,113 |
| Distribution and service fees | 26,083 |
| Payable for independent Trustees' compensation | 19,451 |
| Deferred foreign capital gains tax expense payable | 8,959,627 |
| Accrued expenses and other liabilities | 838,126 |
| Total liabilities | $32,817,536 |
| Net assets | $6,444,113,072 |
| Net assets consist of | |
| Paid-in capital | $5,346,692,645 |
| Total distributable earnings (loss) | 1,097,420,427 |
| Net assets | $6,444,113,072 |
| Shares of beneficial interest outstanding | 201,106,565 |
| (c) | Non-cash collateral is not included. |
Statement of Assets and Liabilities (unaudited) – continued
| | Net assets | Shares
outstanding | Net asset value
per share (a) |
| Class A | $578,582,900 | 18,650,044 | $31.02 |
| Class B | 998,775 | 33,555 | 29.77 |
| Class C | 9,219,478 | 318,126 | 28.98 |
| Class I | 623,364,566 | 19,358,581 | 32.20 |
| Class R1 | 1,402,589 | 50,396 | 27.83 |
| Class R2 | 15,776,465 | 526,982 | 29.94 |
| Class R3 | 110,189,283 | 3,596,742 | 30.64 |
| Class R4 | 92,462,532 | 2,986,211 | 30.96 |
| Class R6 | 5,012,116,484 | 155,585,928 | 32.21 |
| (a) | Maximum offering price per share was equal to the net asset value per share for all share classes, except for Class A, for which the maximum offering price per share was $32.91 [100 / 94.25 x $31.02]. On sales of $50,000 or more, the maximum offering price of Class A shares is reduced. A contingent deferred sales charge may be imposed on redemptions of Class A, Class B, and Class C shares. Redemption price per share was equal to the net asset value per share for Classes I, R1, R2, R3, R4, and R6. |
See Notes to Financial Statements
Financial Statements
Statement of Operations
Six months ended 3/31/24 (unaudited)
This statement describes how much your fund earned in investment income and accrued in expenses. It also describes any gains and/or losses generated by fund operations.
| Net investment income (loss) | |
| Income | |
| Dividends | $56,084,359 |
| Dividends from affiliated issuers | 7,380,465 |
| Income on securities loaned | 115,043 |
| Other | 386 |
| Foreign taxes withheld | (5,508,809) |
| Total investment income | $58,071,444 |
| Expenses | |
| Management fee | $27,125,033 |
| Distribution and service fees | 942,231 |
| Shareholder servicing costs | 1,169,332 |
| Administrative services fee | 307,221 |
| Independent Trustees' compensation | 53,640 |
| Custodian fee | 746,305 |
| Shareholder communications | 103,077 |
| Audit and tax fees | 43,003 |
| Legal fees | 16,796 |
| Reduction of tax reclaim recovery expenses | (261,065) |
| Miscellaneous | 132,425 |
| Total expenses | $30,377,998 |
| Fees paid indirectly | (7,810) |
| Reduction of expenses by investment adviser and distributor | (403,083) |
| Net expenses | $29,967,105 |
| Net investment income (loss) | $28,104,339 |
Statement of Operations (unaudited) – continued
| Realized and unrealized gain (loss) |
| Realized gain (loss) (identified cost basis) | |
| Unaffiliated issuers (includes $4,191,816 foreign capital gains tax) | $188,614,473 |
| Affiliated issuers | 311,014 |
| Foreign currency | (123,542) |
| Net realized gain (loss) | $188,801,945 |
| Change in unrealized appreciation or depreciation | |
| Unaffiliated issuers (includes $2,789,144 increase in deferred foreign capital gains tax) | $499,520,161 |
| Affiliated issuers | 11,058,390 |
| Translation of assets and liabilities in foreign currencies | 171,414 |
| Net unrealized gain (loss) | $510,749,965 |
| Net realized and unrealized gain (loss) | $699,551,910 |
| Change in net assets from operations | $727,656,249 |
See Notes to Financial Statements
Financial Statements
Statements of Changes in Net Assets
These statements describe the increases and/or decreases in net assets resulting from operations, any distributions, and any shareholder transactions.
| | Six months ended | Year ended |
| | 3/31/24 | 9/30/23 |
| Change in net assets | | |
| From operations | | |
| Net investment income (loss) | $28,104,339 | $105,884,157 |
| Net realized gain (loss) | 188,801,945 | 136,968,233 |
| Net unrealized gain (loss) | 510,749,965 | 708,314,606 |
| Change in net assets from operations | $727,656,249 | $951,166,996 |
| Total distributions to shareholders | $(261,403,372) | $(338,663,183) |
| Change in net assets from fund share transactions | $(57,425,782) | $(106,451,841) |
| Total change in net assets | $408,827,095 | $506,051,972 |
| Net assets | | |
| At beginning of period | 6,035,285,977 | 5,529,234,005 |
| At end of period | $6,444,113,072 | $6,035,285,977 |
See Notes to Financial Statements
Financial Statements
Financial Highlights
The financial highlights table is intended to help you understand the fund's financial performance for the semiannual period and the past 5 fiscal years. Certain information reflects financial results for a single fund share. The total returns in the table represent the rate that an investor would have earned (or lost) on an investment in the fund share class (assuming reinvestment of all distributions) held for the entire period.
| Class A | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $28.79 | $25.99 | $38.59 | $33.91 | $32.56 | $35.00 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.08 | $0.40 | $0.27 | $0.27 | $0.13 | $0.29 |
| Net realized and unrealized gain (loss) | 3.35 | 3.98 | (11.06) | 5.80 | 2.09 | (0.82) |
| Total from investment operations | $3.43 | $4.38 | $(10.79) | $6.07 | $2.22 | $(0.53) |
| Less distributions declared to shareholders |
| From net investment income | $(0.50) | $(0.14) | $(0.37) | $(0.03) | $(0.35) | $(0.20) |
| From net realized gain | (0.70) | (1.44) | (1.44) | (1.36) | (0.52) | (1.71) |
| Total distributions declared to shareholders | $(1.20) | $(1.58) | $(1.81) | $(1.39) | $(0.87) | $(1.91) |
| Net asset value, end of period (x) | $31.02 | $28.79 | $25.99 | $38.59 | $33.91 | $32.56 |
| Total return (%) (r)(s)(t)(x) | 12.11(n) | 17.04 | (29.31) | 18.25 | 6.83 | (0.85) |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 1.31(a) | 1.33 | 1.30 | 1.28 | 1.29 | 1.29 |
| Expenses after expense reductions (f) | 1.30(a) | 1.31 | 1.28 | 1.27 | 1.28 | 1.28 |
| Net investment income (loss) | 0.56(a)(l) | 1.37 | 0.84 | 0.73 | 0.39 | 0.90 |
| Portfolio turnover | 9(n) | 9 | 12 | 11 | 25 | 14 |
| Net assets at end of period (000 omitted) | $578,583 | $556,514 | $546,845 | $885,605 | $871,605 | $1,015,817 |
See Notes to Financial Statements
Financial Highlights – continued
| Class B | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $27.42 | $24.87 | $36.95 | $32.73 | $31.42 | $33.86 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $(0.04) | $0.14 | $0.00(w) | $(0.04) | $(0.13) | $0.04 |
| Net realized and unrealized gain (loss) | 3.22 | 3.85 | (10.59) | 5.62 | 2.02 | (0.77) |
| Total from investment operations | $3.18 | $3.99 | $(10.59) | $5.58 | $1.89 | $(0.73) |
| Less distributions declared to shareholders |
| From net investment income | $(0.13) | $— | $(0.05) | $— | $(0.06) | $— |
| From net realized gain | (0.70) | (1.44) | (1.44) | (1.36) | (0.52) | (1.71) |
| Total distributions declared to shareholders | $(0.83) | $(1.44) | $(1.49) | $(1.36) | $(0.58) | $(1.71) |
| Net asset value, end of period (x) | $29.77 | $27.42 | $24.87 | $36.95 | $32.73 | $31.42 |
| Total return (%) (r)(s)(t)(x) | 11.72(n) | 16.17 | (29.85) | 17.37 | 6.03 | (1.57) |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 2.06(a) | 2.07 | 2.05 | 2.03 | 2.04 | 2.04 |
| Expenses after expense reductions (f) | 2.05(a) | 2.06 | 2.03 | 2.02 | 2.03 | 2.03 |
| Net investment income (loss) | (0.29)(a)(l) | 0.50 | 0.01 | (0.11) | (0.43) | 0.12 |
| Portfolio turnover | 9(n) | 9 | 12 | 11 | 25 | 14 |
| Net assets at end of period (000 omitted) | $999 | $1,414 | $2,151 | $5,180 | $5,875 | $9,834 |
See Notes to Financial Statements
Financial Highlights – continued
| Class C | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $26.81 | $24.35 | $36.17 | $32.06 | $30.80 | $33.24 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $(0.03) | $0.15 | $0.01 | $(0.05) | $(0.12) | $0.03 |
| Net realized and unrealized gain (loss) | 3.13 | 3.75 | (10.38) | 5.52 | 1.98 | (0.76) |
| Total from investment operations | $3.10 | $3.90 | $(10.37) | $5.47 | $1.86 | $(0.73) |
| Less distributions declared to shareholders |
| From net investment income | $(0.23) | $— | $(0.01) | $— | $(0.08) | $— |
| From net realized gain | (0.70) | (1.44) | (1.44) | (1.36) | (0.52) | (1.71) |
| Total distributions declared to shareholders | $(0.93) | $(1.44) | $(1.45) | $(1.36) | $(0.60) | $(1.71) |
| Net asset value, end of period (x) | $28.98 | $26.81 | $24.35 | $36.17 | $32.06 | $30.80 |
| Total return (%) (r)(s)(t)(x) | 11.71(n) | 16.15 | (29.84) | 17.39 | 6.04 | (1.60) |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 2.06(a) | 2.07 | 2.05 | 2.03 | 2.04 | 2.04 |
| Expenses after expense reductions (f) | 2.05(a) | 2.06 | 2.03 | 2.02 | 2.03 | 2.03 |
| Net investment income (loss) | (0.25)(a)(l) | 0.54 | 0.03 | (0.14) | (0.40) | 0.10 |
| Portfolio turnover | 9(n) | 9 | 12 | 11 | 25 | 14 |
| Net assets at end of period (000 omitted) | $9,219 | $10,656 | $14,755 | $30,413 | $42,312 | $60,916 |
See Notes to Financial Statements
Financial Highlights – continued
| Class I | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $29.87 | $26.92 | $39.91 | $35.02 | $33.59 | $36.06 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.12 | $0.48 | $0.37 | $0.35 | $0.18 | $0.39 |
| Net realized and unrealized gain (loss) | 3.49 | 4.13 | (11.44) | 6.02 | 2.21 | (0.86) |
| Total from investment operations | $3.61 | $4.61 | $(11.07) | $6.37 | $2.39 | $(0.47) |
| Less distributions declared to shareholders |
| From net investment income | $(0.58) | $(0.22) | $(0.48) | $(0.12) | $(0.44) | $(0.29) |
| From net realized gain | (0.70) | (1.44) | (1.44) | (1.36) | (0.52) | (1.71) |
| Total distributions declared to shareholders | $(1.28) | $(1.66) | $(1.92) | $(1.48) | $(0.96) | $(2.00) |
| Net asset value, end of period (x) | $32.20 | $29.87 | $26.92 | $39.91 | $35.02 | $33.59 |
| Total return (%) (r)(s)(t)(x) | 12.27(n) | 17.31 | (29.13) | 18.54 | 7.12 | (0.62) |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 1.06(a) | 1.08 | 1.05 | 1.03 | 1.04 | 1.04 |
| Expenses after expense reductions (f) | 1.05(a) | 1.06 | 1.03 | 1.02 | 1.03 | 1.03 |
| Net investment income (loss) | 0.79(a)(l) | 1.58 | 1.08 | 0.91 | 0.55 | 1.18 |
| Portfolio turnover | 9(n) | 9 | 12 | 11 | 25 | 14 |
| Net assets at end of period (000 omitted) | $623,365 | $641,010 | $734,605 | $1,235,625 | $1,230,970 | $2,049,197 |
See Notes to Financial Statements
Financial Highlights – continued
| Class R1 | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $25.87 | $23.54 | $35.12 | $31.16 | $30.01 | $32.44 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $(0.02) | $0.15 | $0.03 | $(0.02) | $(0.13) | $0.04 |
| Net realized and unrealized gain (loss) | 3.00 | 3.62 | (10.05) | 5.34 | 1.94 | (0.76) |
| Total from investment operations | $2.98 | $3.77 | $(10.02) | $5.32 | $1.81 | $(0.72) |
| Less distributions declared to shareholders |
| From net investment income | $(0.32) | $— | $(0.12) | $— | $(0.14) | $— |
| From net realized gain | (0.70) | (1.44) | (1.44) | (1.36) | (0.52) | (1.71) |
| Total distributions declared to shareholders | $(1.02) | $(1.44) | $(1.56) | $(1.36) | $(0.66) | $(1.71) |
| Net asset value, end of period (x) | $27.83 | $25.87 | $23.54 | $35.12 | $31.16 | $30.01 |
| Total return (%) (r)(s)(t)(x) | 11.70(n) | 16.15 | (29.84) | 17.41 | 6.03 | (1.61) |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 2.06(a) | 2.08 | 2.05 | 2.03 | 2.04 | 2.04 |
| Expenses after expense reductions (f) | 2.05(a) | 2.06 | 2.03 | 2.02 | 2.03 | 2.03 |
| Net investment income (loss) | (0.18)(a)(l) | 0.58 | 0.11 | (0.07) | (0.45) | 0.14 |
| Portfolio turnover | 9(n) | 9 | 12 | 11 | 25 | 14 |
| Net assets at end of period (000 omitted) | $1,403 | $1,278 | $1,196 | $1,658 | $1,622 | $2,320 |
See Notes to Financial Statements
Financial Highlights – continued
| Class R2 | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $27.79 | $25.13 | $37.36 | $32.92 | $31.63 | $34.02 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.04 | $0.32 | $0.19 | $0.15 | $0.01 | $0.22 |
| Net realized and unrealized gain (loss) | 3.24 | 3.85 | (10.71) | 5.65 | 2.07 | (0.81) |
| Total from investment operations | $3.28 | $4.17 | $(10.52) | $5.80 | $2.08 | $(0.59) |
| Less distributions declared to shareholders |
| From net investment income | $(0.43) | $(0.07) | $(0.27) | $— | $(0.27) | $(0.09) |
| From net realized gain | (0.70) | (1.44) | (1.44) | (1.36) | (0.52) | (1.71) |
| Total distributions declared to shareholders | $(1.13) | $(1.51) | $(1.71) | $(1.36) | $(0.79) | $(1.80) |
| Net asset value, end of period (x) | $29.94 | $27.79 | $25.13 | $37.36 | $32.92 | $31.63 |
| Total return (%) (r)(s)(t)(x) | 11.99(n) | 16.73 | (29.48) | 17.95 | 6.58 | (1.10) |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 1.56(a) | 1.58 | 1.55 | 1.53 | 1.54 | 1.54 |
| Expenses after expense reductions (f) | 1.55(a) | 1.56 | 1.53 | 1.52 | 1.53 | 1.53 |
| Net investment income (loss) | 0.30(a)(l) | 1.12 | 0.60 | 0.42 | 0.03 | 0.71 |
| Portfolio turnover | 9(n) | 9 | 12 | 11 | 25 | 14 |
| Net assets at end of period (000 omitted) | $15,776 | $15,234 | $14,568 | $24,443 | $24,546 | $43,493 |
See Notes to Financial Statements
Financial Highlights – continued
| Class R3 | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $28.44 | $25.69 | $38.19 | $33.58 | $32.25 | $34.69 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.08 | $0.40 | $0.26 | $0.29 | $0.13 | $0.29 |
| Net realized and unrealized gain (loss) | 3.32 | 3.93 | (10.92) | 5.72 | 2.08 | (0.83) |
| Total from investment operations | $3.40 | $4.33 | $(10.66) | $6.01 | $2.21 | $(0.54) |
| Less distributions declared to shareholders |
| From net investment income | $(0.50) | $(0.14) | $(0.40) | $(0.04) | $(0.36) | $(0.19) |
| From net realized gain | (0.70) | (1.44) | (1.44) | (1.36) | (0.52) | (1.71) |
| Total distributions declared to shareholders | $(1.20) | $(1.58) | $(1.84) | $(1.40) | $(0.88) | $(1.90) |
| Net asset value, end of period (x) | $30.64 | $28.44 | $25.69 | $38.19 | $33.58 | $32.25 |
| Total return (%) (r)(s)(t)(x) | 12.14(n) | 17.05 | (29.32) | 18.25 | 6.86 | (0.88) |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 1.31(a) | 1.33 | 1.30 | 1.28 | 1.29 | 1.29 |
| Expenses after expense reductions (f) | 1.30(a) | 1.31 | 1.28 | 1.27 | 1.28 | 1.28 |
| Net investment income (loss) | 0.56(a)(l) | 1.37 | 0.79 | 0.78 | 0.42 | 0.92 |
| Portfolio turnover | 9(n) | 9 | 12 | 11 | 25 | 14 |
| Net assets at end of period (000 omitted) | $110,189 | $105,551 | $109,712 | $201,807 | $142,713 | $132,789 |
See Notes to Financial Statements
Financial Highlights – continued
| Class R4 | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $28.78 | $25.98 | $38.57 | $33.89 | $32.54 | $35.00 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.12 | $0.47 | $0.34 | $0.32 | $0.21 | $0.36 |
| Net realized and unrealized gain (loss) | 3.34 | 3.99 | (11.04) | 5.84 | 2.10 | (0.82) |
| Total from investment operations | $3.46 | $4.46 | $(10.70) | $6.16 | $2.31 | $(0.46) |
| Less distributions declared to shareholders |
| From net investment income | $(0.58) | $(0.22) | $(0.45) | $(0.12) | $(0.44) | $(0.29) |
| From net realized gain | (0.70) | (1.44) | (1.44) | (1.36) | (0.52) | (1.71) |
| Total distributions declared to shareholders | $(1.28) | $(1.66) | $(1.89) | $(1.48) | $(0.96) | $(2.00) |
| Net asset value, end of period (x) | $30.96 | $28.78 | $25.98 | $38.57 | $33.89 | $32.54 |
| Total return (%) (r)(s)(t)(x) | 12.23(n) | 17.38 | (29.16) | 18.56 | 7.10 | (0.61) |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 1.06(a) | 1.08 | 1.05 | 1.03 | 1.04 | 1.04 |
| Expenses after expense reductions (f) | 1.05(a) | 1.06 | 1.03 | 1.02 | 1.03 | 1.03 |
| Net investment income (loss) | 0.83(a)(l) | 1.60 | 1.02 | 0.85 | 0.66 | 1.14 |
| Portfolio turnover | 9(n) | 9 | 12 | 11 | 25 | 14 |
| Net assets at end of period (000 omitted) | $92,463 | $84,612 | $82,390 | $182,567 | $260,005 | $276,550 |
See Notes to Financial Statements
Financial Highlights – continued
| Class R6 | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $29.91 | $26.95 | $39.97 | $35.06 | $33.64 | $36.11 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.15 | $0.54 | $0.43 | $0.42 | $0.28 | $0.44 |
| Net realized and unrealized gain (loss) | 3.48 | 4.13 | (11.48) | 6.02 | 2.13 | (0.87) |
| Total from investment operations | $3.63 | $4.67 | $(11.05) | $6.44 | $2.41 | $(0.43) |
| Less distributions declared to shareholders |
| From net investment income | $(0.63) | $(0.27) | $(0.53) | $(0.17) | $(0.47) | $(0.33) |
| From net realized gain | (0.70) | (1.44) | (1.44) | (1.36) | (0.52) | (1.71) |
| Total distributions declared to shareholders | $(1.33) | $(1.71) | $(1.97) | $(1.53) | $(0.99) | $(2.04) |
| Net asset value, end of period (x) | $32.21 | $29.91 | $26.95 | $39.97 | $35.06 | $33.64 |
| Total return (%) (r)(s)(t)(x) | 12.33(n) | 17.52 | (29.06) | 18.74 | 7.20 | (0.47) |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 0.91(a) | 0.93 | 0.91 | 0.90 | 0.92 | 0.92 |
| Expenses after expense reductions (f) | 0.90(a) | 0.92 | 0.90 | 0.89 | 0.91 | 0.91 |
| Net investment income (loss) | 0.97(a)(l) | 1.79 | 1.26 | 1.08 | 0.84 | 1.34 |
| Portfolio turnover | 9(n) | 9 | 12 | 11 | 25 | 14 |
| Net assets at end of period (000 omitted) | $5,012,116 | $4,619,017 | $4,023,013 | $5,635,101 | $4,191,916 | $3,385,991 |
| (a) | Annualized. |
| (d) | Per share data is based on average shares outstanding. |
| (f) | Ratios do not reflect reductions from fees paid indirectly, if applicable. See Note 2 in the Notes to Financial Statements for additional information. |
| (l) | Recognition of net investment income by the fund may be affected by the timing of the declaration of dividends by companies in which the fund invests and the actual annual net investment income ratio may differ. |
| (n) | Not annualized. |
| (r) | Certain expenses have been reduced without which performance would have been lower. |
| (s) | From time to time the fund may receive proceeds from litigation settlements, without which performance would be lower. |
| (t) | Total returns do not include any applicable sales charges. |
| (w) | Per share amount was less than $0.01. |
| (x) | The net asset values and total returns have been calculated on net assets which include adjustments made in accordance with U.S. generally accepted accounting principles required at period end for financial reporting purposes. |
See Notes to Financial Statements
Notes to Financial Statements
(unaudited)
(1) Business and Organization
MFS International New Discovery Fund (the fund) is a diversified series of MFS Series Trust V (the trust). The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company.
The fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services - Investment Companies.
(2) Significant Accounting Policies
General — The preparation of financial statements in conformity with U.S. generally accepted accounting principles 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 increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. In the preparation of these financial statements, management has evaluated subsequent events occurring after the date of the fund’s Statement of Assets and Liabilities through the date that the financial statements were issued. The fund will generally focus on securities of small size companies which may be more volatile than those of larger companies. The fund invests in foreign securities, including securities of emerging market issuers. Investments in foreign securities are vulnerable to the effects of changes in the relative values of the local currency and the U.S. dollar and to the effects of changes in each country’s market, economic, industrial, political, regulatory, geopolitical, environmental, public health, and other conditions. Investments in emerging markets can involve additional and greater risks than the risks associated with investments in developed foreign markets. Emerging markets can have less developed markets, greater custody and operational risk, less developed legal, regulatory, accounting, and auditing systems, greater government involvement in the economy, greater risk of new or inconsistent government treatment of or restrictions on issuers and instruments, and greater political, social, and economic instability than developed markets.
Balance Sheet Offsetting — The fund's accounting policy with respect to balance sheet offsetting is that, absent an event of default by the counterparty or a termination of the agreement, the International Swaps and Derivatives Association (ISDA) Master Agreement, or similar agreement, does not result in an offset of reported amounts of financial assets and financial liabilities in the Statement of Assets and Liabilities across transactions between the fund and the applicable counterparty. The fund's right to setoff may be restricted or prohibited by the bankruptcy or insolvency laws of the particular jurisdiction to which a specific master netting agreement counterparty is subject. Balance sheet offsetting disclosures, to the extent applicable to the fund, have been included in the fund’s Significant Accounting Policies note under the captions for each of the fund’s in-scope financial instruments and transactions.
Investment Valuations — Subject to its oversight, the fund's Board of Trustees has delegated primary responsibility for determining or causing to be determined the value of the fund’s investments to MFS as the fund's adviser, pursuant to the fund’s valuation policy and procedures which have been adopted by the adviser and approved by the
Notes to Financial Statements (unaudited) - continued
Board. In accordance with Rule 2a-5 under the Investment Company Act of 1940, the Board of Trustees designated the adviser as the “valuation designee” of the fund. If the adviser, as valuation designee, determines that reliable market quotations are not readily available for an investment, the investment is valued at fair value as determined in good faith by the adviser in accordance with the adviser’s fair valuation policy and procedures.
Under the fund's valuation policy and procedures, equity securities, including restricted equity securities, are generally valued at the last sale or official closing price on their primary market or exchange as provided by a third-party pricing service. Equity securities, for which there were no sales reported that day, are generally valued at the last quoted daily bid quotation on their primary market or exchange as provided by a third-party pricing service. Short-term instruments with a maturity at issuance of 60 days or less may be valued at amortized cost, which approximates market value.
Open-end investment companies are generally valued at net asset value per share. The values of foreign securities and other assets and liabilities expressed in foreign currencies are converted to U.S. dollars using the mean of bid and asked prices for rates provided by a third-party pricing service.
Under the fund’s valuation policy and procedures, market quotations are not considered to be readily available for debt instruments, floating rate loans, and many types of derivatives. These investments are generally valued at fair value based on information from third-party pricing services or otherwise determined by the adviser in accordance with the adviser’s fair valuation policy and procedures. Securities and other assets generally valued on the basis of information from a third-party pricing service may also be valued at a broker/dealer bid quotation. In determining values, third-party pricing services can utilize both transaction data and market information such as yield, quality, coupon rate, maturity, type of issue, trading characteristics, spreads and other market data. An investment may also be valued at fair value if the adviser determines that the investment’s value has been materially affected by events occurring after the close of the exchange or market on which the investment is principally traded (such as foreign exchange or market) and prior to the determination of the fund’s net asset value, or after the halt of trading of a specific security where trading does not resume prior to the close of the exchange or market on which the security is principally traded. Events that occur after foreign markets close (such as developments in foreign markets and significant movements in the U.S. markets) and prior to the determination of the fund’s net asset value may be deemed to have a material effect on the value of securities traded in foreign markets. Accordingly, the fund’s foreign equity securities may often be valued at fair value. The adviser generally relies on third-party pricing services or other information (such as the correlation with price movements of similar securities in the same or other markets; the type, cost and investment characteristics of the security; the business and financial condition of the issuer; and trading and other market data) to assist in determining whether to fair value and at what value to fair value an investment. The value of an investment for purposes of calculating the fund’s net asset value can differ depending on the source and method used to determine value. When fair valuation is used, the value of an investment used to determine the fund’s net asset value may differ from quoted or published prices for the same investment. There can be no assurance that the fund could obtain the fair value assigned to an investment if it were to sell the investment at the same time at which the fund determines its net asset value per share.
Notes to Financial Statements (unaudited) - continued
Various inputs are used in determining the value of the fund's assets or liabilities. These inputs are categorized into three broad levels. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an investment's level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fund's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the investment. Level 1 includes unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 includes other significant observable market-based inputs (including quoted prices for similar securities, interest rates, prepayment speed, and credit risk). Level 3 includes significant unobservable inputs, which may include the adviser's own assumptions in determining the fair value of investments. The following is a summary of the levels used as of March 31, 2024 in valuing the fund's assets and liabilities:
| Financial Instruments | Level 1 | Level 2 | Level 3 | Total |
| Equity Securities: | | | | |
| Japan | $1,700,906,274 | $— | $— | $1,700,906,274 |
| United Kingdom | 769,487,945 | — | — | 769,487,945 |
| Australia | 392,149,046 | — | — | 392,149,046 |
| Germany | 363,054,495 | — | — | 363,054,495 |
| France | 265,989,907 | — | — | 265,989,907 |
| Taiwan | 240,481,456 | — | — | 240,481,456 |
| India | 231,211,083 | — | — | 231,211,083 |
| Hong Kong | 205,462,690 | — | — | 205,462,690 |
| South Korea | 193,649,036 | — | — | 193,649,036 |
| Other Countries | 1,600,044,644 | 101,200,090 | 0 | 1,701,244,734 |
| Mutual Funds | 363,292,935 | — | — | 363,292,935 |
| Total | $6,325,729,511 | $101,200,090 | $0 | $6,426,929,601 |
For further information regarding security characteristics, see the Portfolio of Investments. At March 31, 2024, the fund held one level 3 security valued at $0, which was also held and valued at $0 at September 30, 2023.
Foreign Currency Translation — Purchases and sales of foreign investments, income, and expenses are converted into U.S. dollars based upon currency exchange rates prevailing on the respective dates of such transactions or on the reporting date for foreign denominated receivables and payables. Gains and losses attributable to foreign currency exchange rates on sales of securities are recorded for financial statement purposes as net realized gains and losses on investments. Gains and losses attributable to foreign exchange rate movements on receivables, payables, income and expenses are recorded for financial statement purposes as foreign currency transaction gains and losses. That portion of both realized and unrealized gains and losses on investments that results from fluctuations in foreign currency exchange rates is not separately disclosed.
Security Loans — Under its Securities Lending Agency Agreement with the fund, JPMorgan Chase and Co., as lending agent, loans the securities of the fund to certain qualified institutions (the “Borrowers”) approved by the fund. Security loans can be terminated at the discretion of either the lending agent or the fund and the related securities must be returned within the earlier of the standard trade settlement period for such securities or within three business days. The loans are collateralized by cash
Notes to Financial Statements (unaudited) - continued
and/or U.S. Treasury and federal agency obligations in an amount typically at least equal to the market value of the securities loaned. On loans collateralized by cash, the cash collateral is invested in a money market fund. The market value of the loaned securities is determined at the close of business of the fund and any additional required collateral is delivered to the fund on the next business day. The lending agent provides the fund with indemnification against Borrower default. In the event of Borrower default, the lending agent will, for the benefit of the fund, either purchase securities identical to those loaned or, when such purchase is commercially impracticable, pay the fund the market value of the loaned securities. In return, the lending agent assumes the fund's rights to the related collateral. If the collateral value is less than the cost to purchase identical securities, the lending agent is responsible for the shortfall, but only to the extent that such shortfall is not due to a decline in collateral value resulting from collateral reinvestment for which the fund bears the risk of loss. At period end, the fund had investment securities on loan, all of which were classified as equity securities in the fund's Portfolio of Investments, with a fair value of $120,038,716. The fair value of the fund's investment securities on loan and a related liability of $18,971,656 for cash collateral received on securities loaned are both presented gross in the Statement of Assets and Liabilities. Additionally, these loans were collateralized by U.S. Treasury Obligations of $111,575,090 held by the custodian or a triparty custodian. The collateral on securities loaned exceeded the value of securities on loan at period end. The liability for cash collateral for securities loaned is carried at fair value, which is categorized as level 2 within the fair value hierarchy. A portion of the income generated upon investment of the collateral is remitted to the Borrowers, and the remainder is allocated between the fund and the lending agent. On loans collateralized by U.S. Treasury and/or federal agency obligations, a fee is received from the Borrower, and is allocated between the fund and the lending agent. Income from securities lending is separately reported in the Statement of Operations. The dividend and interest income earned on the securities loaned is accounted for in the same manner as other dividend and interest income.
Indemnifications — Under the fund's organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to the fund. Additionally, in the normal course of business, the fund enters into agreements with service providers that may contain indemnification clauses. The fund's maximum exposure under these agreements is unknown as this would involve future claims that may be made against the fund that have not yet occurred.
Investment Transactions and Income — Dividends received in cash are recorded on the ex-dividend date. Certain dividends from foreign securities will be recorded when the fund is informed of the dividend if such information is obtained subsequent to the ex-dividend date. Dividend payments received in additional securities are recorded on the ex-dividend date in an amount equal to the value of the security on such date.
The fund may receive proceeds from litigation settlements. Any proceeds received from litigation involving portfolio holdings are reflected in the Statement of Operations in realized gain/loss if the security has been disposed of by the fund or in unrealized gain/loss if the security is still held by the fund. Any other proceeds from litigation not related to portfolio holdings are reflected as other income in the Statement of Operations.
Notes to Financial Statements (unaudited) - continued
Investment transactions are recorded on the trade date. In determining the net gain or loss on securities sold, the cost of securities is determined on the identified cost basis.
Fees Paid Indirectly — The fund's custody fee may be reduced by a credit earned under an arrangement that measures the value of U.S. dollars deposited with the custodian by the fund. The amount of the credit, for the six months ended March 31, 2024, is shown as a reduction of total expenses in the Statement of Operations.
Tax Matters and Distributions — The fund intends to qualify as a regulated investment company, as defined under Subchapter M of the Internal Revenue Code, and to distribute all of its taxable income, including realized capital gains. As a result, no provision for federal income tax is required. The fund’s federal tax returns, when filed, will remain subject to examination by the Internal Revenue Service for a three year period. Management has analyzed the fund’s tax positions taken on federal and state tax returns for all open tax years and does not believe that there are any uncertain tax positions that require recognition of a tax liability. Foreign taxes, if any, have been accrued by the fund in the accompanying financial statements in accordance with the applicable foreign tax law. Foreign income taxes may be withheld by certain countries in which the fund invests. Additionally, capital gains realized by the fund on securities issued in or by certain foreign countries may be subject to capital gains tax imposed by those countries.
The fund has filed tax reclaims for previously withheld taxes on dividends earned in certain European Union (EU) countries. These additional filings are subject to various administrative proceedings by the local jurisdictions’ tax authorities within the EU, as well as a number of related judicial proceedings. These reclaims are recorded only when certainty exists as to the likelihood of receipt and the potential timing of payment. For the six months ended March 31, 2024, estimated professional fees associated with recovering these foreign taxes accrued for in the prior year were reduced by $261,065 pursuant to agreed upon limitations and are reflected as Reduction of tax reclaim recovery expenses in the Statement of Operations.
Distributions to shareholders are recorded on the ex-dividend date. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from U.S. generally accepted accounting principles. Certain capital accounts in the financial statements are periodically adjusted for permanent differences in order to reflect their tax character. These adjustments have no impact on net assets or net asset value per share. Temporary differences which arise from recognizing certain items of income, expense, gain or loss in different periods for financial statement and tax purposes will reverse at some time in the future.
Book/tax differences primarily relate to passive foreign investment companies, wash sale loss deferrals, treating a portion of the proceeds from redemptions as a distribution for tax purposes, and foreign taxes.
Notes to Financial Statements (unaudited) - continued
The tax character of distributions made during the current period will be determined at fiscal year end. The tax character of distributions declared to shareholders for the last fiscal year is as follows:
| | Year ended
9/30/23 |
| Ordinary income (including any short-term capital gains) | $49,150,638 |
| Long-term capital gains | 289,512,545 |
| Total distributions | $338,663,183 |
The federal tax cost and the tax basis components of distributable earnings were as follows:
| As of 3/31/24 | |
| Cost of investments | $5,517,849,639 |
| Gross appreciation | 1,611,836,518 |
| Gross depreciation | (702,756,556) |
| Net unrealized appreciation (depreciation) | $909,079,962 |
| As of 9/30/23 | |
| Undistributed ordinary income | 119,850,221 |
| Undistributed long-term capital gain | 123,006,114 |
| Other temporary differences | (7,401,052) |
| Net unrealized appreciation (depreciation) | 395,712,267 |
The aggregate cost above includes prior fiscal year end tax adjustments, if applicable.
Multiple Classes of Shares of Beneficial Interest — The fund offers multiple classes of shares, which differ in their respective distribution and service fees. The fund's income, realized and unrealized gain (loss), and common expenses are allocated to shareholders based on the daily net assets of each class. Dividends are declared separately for each class. Differences in per share dividend rates are generally due to differences in separate class expenses. Class B and Class C shares will convert to Class A shares approximately eight years after purchase. The fund’s distributions declared to shareholders as reported in the Statements of Changes in Net Assets are presented by class as follows:
| | Six months
ended
3/31/24 | | Year
ended
9/30/23 |
| Class A | $22,642,807 | | $32,274,365 |
| Class B | 31,987 | | 107,835 |
| Class C | 326,404 | | 743,169 |
| Class I | 26,237,805 | | 41,319,509 |
| Class R1 | 51,343 | | 74,775 |
| Class R2 | 610,158 | | 865,845 |
| Class R3 | 4,341,117 | | 7,008,148 |
| Class R4 | 3,734,442 | | 5,175,642 |
| Class R6 | 203,427,309 | | 251,093,895 |
| Total | $261,403,372 | | $338,663,183 |
Notes to Financial Statements (unaudited) - continued
(3) Transactions with Affiliates
Investment Adviser — The fund has an investment advisory agreement with MFS to provide overall investment management and related administrative services and facilities to the fund. The management fee is computed daily and paid monthly at the following annual rates based on the fund's average daily net assets:
| Up to $500 million | 0.975% |
| In excess of $500 million and up to $1 billion | 0.925% |
| In excess of $1 billion and up to $3 billion | 0.90% |
| In excess of $3 billion and up to $5 billion | 0.85% |
| In excess of $5 billion and up to $10 billion | 0.80% |
| In excess of $10 billion | 0.75% |
MFS has agreed in writing to reduce its management fee by a specified amount if certain MFS mutual fund assets exceed thresholds agreed to by MFS and the fund's Board of Trustees. MFS has also agreed in writing to waive at least 0.01% of its management fee as part of this agreement. The agreement to waive at least 0.01% of the management fee will continue until modified by the fund's Board of Trustees, but such agreement will continue at least until January 31, 2025. For the six months ended March 31, 2024, this management fee reduction amounted to $403,010, which is included in the reduction of total expenses in the Statement of Operations. The management fee incurred for the six months ended March 31, 2024 was equivalent to an annual effective rate of 0.86% of the fund's average daily net assets.
Distributor — MFS Fund Distributors, Inc. (MFD), a wholly-owned subsidiary of MFS, as distributor, received $6,118 for the six months ended March 31, 2024, as its portion of the initial sales charge on sales of Class A shares of the fund.
The Board of Trustees has adopted a distribution plan for certain share classes pursuant to Rule 12b-1 of the Investment Company Act of 1940.
The fund's distribution plan provides that the fund will pay MFD for services provided by MFD and financial intermediaries in connection with the distribution and servicing of certain share classes. One component of the plan is a distribution fee paid to MFD and another component of the plan is a service fee paid to MFD. MFD may subsequently pay all, or a portion, of the distribution and/or service fees to financial intermediaries. The distribution and service fees are computed daily and paid monthly.
Notes to Financial Statements (unaudited) - continued
Distribution Plan Fee Table:
| | Distribution
Fee Rate (d) | Service
Fee Rate (d) | Total
Distribution
Plan (d) | Annual
Effective
Rate (e) | Distribution
and Service
Fee |
| Class A | — | 0.25% | 0.25% | 0.25% | $ 706,323 |
| Class B | 0.75% | 0.25% | 1.00% | 1.00% | 5,710 |
| Class C | 0.75% | 0.25% | 1.00% | 1.00% | 49,313 |
| Class R1 | 0.75% | 0.25% | 1.00% | 1.00% | 6,701 |
| Class R2 | 0.25% | 0.25% | 0.50% | 0.50% | 38,961 |
| Class R3 | — | 0.25% | 0.25% | 0.25% | 135,223 |
| Total Distribution and Service Fees | | | | | $942,231 |
| (d) | In accordance with the distribution plan for certain classes, the fund pays distribution and/or service fees equal to these annual percentage rates of each class’s average daily net assets. The distribution and service fee rates disclosed by class represent the current rates in effect at the end of the reporting period. Any rate changes, if applicable, are detailed below. |
| (e) | The annual effective rates represent actual fees incurred under the distribution plan for the six months ended March 31, 2024 based on each class's average daily net assets. MFD has voluntarily agreed to rebate a portion of each class's 0.25% service fee attributable to accounts for which there is no financial intermediary specified on the account except for accounts attributable to MFS or its affiliates' seed money. For the six months ended March 31, 2024, this rebate amounted to $67 and $6 for Class A and Class R2 shares, respectively, and is included in the reduction of total expenses in the Statement of Operations. |
Certain Class A shares are subject to a contingent deferred sales charge (CDSC) in the event of a shareholder redemption within 18 months of purchase. Class B shares are subject to a CDSC in the event of a shareholder redemption within six years of purchase. Class C shares are subject to a CDSC in the event of a shareholder redemption within 12 months of purchase. All contingent deferred sales charges are paid to MFD and during the six months ended March 31, 2024, were as follows:
| | Amount |
| Class A | $68 |
| Class B | 291 |
| Class C | 190 |
Shareholder Servicing Agent — MFS Service Center, Inc. (MFSC), a wholly-owned subsidiary of MFS, receives a fee from the fund for its services as shareholder servicing agent calculated as a percentage of the average daily net assets of the fund as determined periodically under the supervision of the fund's Board of Trustees. For the six months ended March 31, 2024, the fee was $58,940, which equated to 0.0019% annually of the fund's average daily net assets. MFSC also receives reimbursement from the fund for out-of-pocket expenses, sub-accounting and other shareholder servicing costs which may be paid to affiliated and unaffiliated service providers. Class R6 shares do not incur sub-accounting fees. For the six months ended March 31, 2024, these out-of-pocket expenses, sub-accounting and other shareholder servicing costs amounted to $1,110,392.
Administrator — MFS provides certain financial, legal, shareholder communications, compliance, and other administrative services to the fund. Under an administrative services agreement, the fund reimburses MFS the costs incurred to provide these
Notes to Financial Statements (unaudited) - continued
services. The fund is charged an annual fixed amount of $17,500 plus a fee based on average daily net assets. The administrative services fee is computed daily and paid monthly. The administrative services fee incurred for the six months ended March 31, 2024 was equivalent to an annual effective rate of 0.0099% of the fund's average daily net assets.
Trustees’ and Officers’ Compensation — The fund pays compensation to independent Trustees in the form of a retainer, attendance fees, and additional compensation to Board and Committee chairpersons. Independent Trustees’ compensation is accrued daily and paid subsequent to each Trustee Board meeting. The fund does not pay compensation directly to Trustees or officers of the fund who are also officers of the investment adviser, all of whom receive remuneration from MFS for their services to the fund. Certain officers and Trustees of the fund are officers or directors of MFS, MFD, and MFSC.
Other — The fund invests in the MFS Institutional Money Market Portfolio which is managed by MFS and seeks current income consistent with preservation of capital and liquidity. This money market fund does not pay a management fee to MFS but does incur investment and operating costs.
During the six months ended March 31, 2024, pursuant to a policy adopted by the Board of Trustees and designed to comply with Rule 17a-7 under the Investment Company Act of 1940 (the “Act”) and relevant guidance, the fund engaged in sale transactions with funds and accounts for which MFS serves as investment adviser or sub-adviser (“cross-trades”) which amounted to $1,623,154. The sales transactions resulted in net realized gains (losses) of $102,691.
(4) Portfolio Securities
For the six months ended March 31, 2024, purchases and sales of investments, other than short-term obligations, aggregated $521,538,169 and $898,632,185, respectively.
Notes to Financial Statements (unaudited) - continued
(5) Shares of Beneficial Interest
The fund's Declaration of Trust permits the Trustees to issue an unlimited number of full and fractional shares of beneficial interest. Transactions in fund shares were as follows:
| | Six months ended
3/31/24 | | Year ended
9/30/23 |
| | Shares | Amount | | Shares | Amount |
| Shares sold | | | | | |
| Class A | 453,590 | $13,520,045 | | 848,578 | $24,740,833 |
| Class B | 9 | 250 | | 22 | 600 |
| Class C | 3,927 | 109,280 | | 11,817 | 323,049 |
| Class I | 864,576 | 26,096,306 | | 1,905,649 | 56,905,922 |
| Class R1 | 2,930 | 78,085 | | 7,217 | 190,804 |
| Class R2 | 28,611 | 821,714 | | 61,654 | 1,749,778 |
| Class R3 | 163,386 | 4,822,394 | | 645,054 | 18,305,933 |
| Class R4 | 346,920 | 10,261,876 | | 470,453 | 13,796,333 |
| Class R6 | 2,747,356 | 83,988,760 | | 13,323,415 | 408,228,786 |
| | 4,611,305 | $139,698,710 | | 17,273,859 | $524,242,038 |
Shares issued to shareholders
in reinvestment of distributions | | | | | |
| Class A | 674,654 | $20,097,952 | | 1,033,398 | $28,862,801 |
| Class B | 1,117 | 31,987 | | 4,028 | 107,835 |
| Class C | 11,515 | 321,146 | | 27,964 | 731,889 |
| Class I | 768,752 | 23,754,428 | | 1,336,675 | 38,656,651 |
| Class R1 | 1,917 | 51,343 | | 2,961 | 74,775 |
| Class R2 | 21,077 | 606,392 | | 31,871 | 861,149 |
| Class R3 | 147,557 | 4,341,117 | | 254,010 | 7,008,147 |
| Class R4 | 112,212 | 3,333,815 | | 168,193 | 4,685,843 |
| Class R6 | 6,436,836 | 198,898,232 | | 8,359,122 | 241,745,799 |
| | 8,175,637 | $251,436,412 | | 11,218,222 | $322,734,889 |
| Shares reacquired | | | | | |
| Class A | (1,807,994) | $(53,631,926) | | (3,594,738) | $(104,513,846) |
| Class B | (19,140) | (531,893) | | (38,966) | (1,078,132) |
| Class C | (94,749) | (2,613,494) | | (248,408) | (6,689,170) |
| Class I | (3,732,257) | (114,808,099) | | (9,078,106) | (273,108,797) |
| Class R1 | (3,838) | (101,750) | | (11,605) | (306,784) |
| Class R2 | (70,886) | (2,031,501) | | (125,135) | (3,534,767) |
| Class R3 | (425,462) | (12,572,990) | | (1,458,409) | (42,769,272) |
| Class R4 | (413,246) | (12,322,442) | | (869,046) | (25,143,686) |
| Class R6 | (8,026,177) | (249,946,809) | | (16,515,864) | (496,284,314) |
| | (14,593,749) | $(448,560,904) | | (31,940,277) | $(953,428,768) |
Notes to Financial Statements (unaudited) - continued
| | Six months ended
3/31/24 | | Year ended
9/30/23 |
| | Shares | Amount | | Shares | Amount |
| Net change | | | | | |
| Class A | (679,750) | $(20,013,929) | | (1,712,762) | $(50,910,212) |
| Class B | (18,014) | (499,656) | | (34,916) | (969,697) |
| Class C | (79,307) | (2,183,068) | | (208,627) | (5,634,232) |
| Class I | (2,098,929) | (64,957,365) | | (5,835,782) | (177,546,224) |
| Class R1 | 1,009 | 27,678 | | (1,427) | (41,205) |
| Class R2 | (21,198) | (603,395) | | (31,610) | (923,840) |
| Class R3 | (114,519) | (3,409,479) | | (559,345) | (17,455,192) |
| Class R4 | 45,886 | 1,273,249 | | (230,400) | (6,661,510) |
| Class R6 | 1,158,015 | 32,940,183 | | 5,166,673 | 153,690,271 |
| | (1,806,807) | $(57,425,782) | | (3,448,196) | $(106,451,841) |
The fund is one of several mutual funds in which certain MFS funds may invest. The MFS funds do not invest in the underlying funds for the purpose of exercising management or control. At the end of the period, the MFS International Diversification Fund, the MFS Growth Allocation Fund, the MFS Aggressive Growth Allocation Fund, and the MFS Moderate Allocation Fund were the owners of record of approximately 60%, 2%, 2%, and 1%, respectively, of the value of outstanding voting shares of the fund. In addition, the MFS Lifetime 2030 Fund, the MFS Lifetime 2035 Fund, the MFS Lifetime 2040 Fund, the MFS Lifetime 2045 Fund, the MFS Lifetime 2050 Fund, the MFS Lifetime 2055 Fund, the MFS Lifetime 2060 Fund, and the MFS Lifetime 2065 Fund were each the owners of record of less than 1% of the value of outstanding voting shares of the fund.
Effective June 1, 2019, purchases of the fund's Class B shares were closed to new and existing investors subject to certain exceptions. Effective at the close of business on November 29, 2019, purchases of the fund were closed to new investors subject to certain exceptions. Effective September 29, 2023, purchases of the fund's Class R1 and Class R2 shares were closed to new eligible investors.
(6) Line of Credit
The fund and certain other funds managed by MFS participate in a $1.45 billion unsecured committed line of credit of which $1.2 billion is reserved for use by the fund and certain other MFS U.S. funds. The line of credit is provided by a syndicate of banks under a credit agreement. Borrowings may be made for temporary financing needs. Interest is charged to each fund, based on its borrowings, generally at a rate equal to the highest of 1) Daily Simple SOFR (Secured Overnight Financing Rate) plus 0.10%, 2) the Federal Funds Effective Rate, or 3) the Overnight Bank Funding Rate, each plus an agreed upon spread. A commitment fee, based on the average daily unused portion of the committed line of credit, is allocated among the participating funds. The line of credit expires on March 13, 2025 unless extended or renewed. In addition, the fund and other funds managed by MFS have established unsecured uncommitted borrowing arrangements with certain banks for temporary financing needs. Interest is charged to each fund, based on its borrowings, at rates equal to customary reference rates plus an
Notes to Financial Statements (unaudited) - continued
agreed upon spread. For the six months ended March 31, 2024, the fund’s commitment fee and interest expense were $15,919 and $0, respectively, and are included in “Miscellaneous” expense in the Statement of Operations.
(7) Investments in Affiliated Issuers
An affiliated issuer may be considered one in which the fund owns 5% or more of the outstanding voting securities, or a company which is under common control. For the purposes of this report, the following were affiliated issuers:
| Affiliated Issuers | Beginning
Value | Purchases | Sales
Proceeds | Realized
Gain
(Loss) | Change in
Unrealized
Appreciation or
Depreciation | Ending
Value |
| Forterra PLC | $26,475,055 | $— | $— | $— | $5,219,352 | $31,694,407 |
| MFS Institutional Money Market Portfolio | 276,572,732 | 948,993,062 | 881,259,460 | (3,679) | 18,624 | 344,321,279 |
| Midland Holdings Ltd. | 3,358,332 | — | — | — | 2,039,813 | 5,398,145 |
| PCA Corp. | 11,308,025 | — | — | — | 4,697,357 | 16,005,382 |
| T. Hasegawa Co. Ltd. | 63,849,170 | — | 7,563,001 | 314,693 | (916,756) | 55,684,106 |
| | $381,563,314 | $948,993,062 | $888,822,461 | $311,014 | $11,058,390 | $453,103,319 |
| Affiliated Issuers | Dividend
Income | Capital Gain
Distributions |
| Forterra PLC | $— | $— |
| MFS Institutional Money Market Portfolio | 6,352,083 | — |
| Midland Holdings Ltd. | — | — |
| PCA Corp. | 515,647 | — |
| T. Hasegawa Co. Ltd. | 512,735 | — |
| | $7,380,465 | $— |
(8) Russia and Ukraine Conflict
The fund invests in securities and/or derivative instruments that are economically tied to Russia and/or Ukraine. Escalation of the conflict between Russia and Ukraine in late February 2022 caused market volatility and disruption in the tradability of Russian securities, including closure of the local securities market, temporary restriction on securities sales by non-residents, and disruptions to clearance and payment systems. To the extent that the fund is unable to sell securities, whether due to market constraints or to the sanctions imposed on Russia by the United States and other countries, those securities are considered illiquid and the value of those securities reflects their illiquid classification. Management continues to monitor these events and to evaluate the related impacts on fund performance.
Statement Regarding Liquidity Risk Management Program
The fund has adopted and implemented a liquidity risk management program (the “Program”) as required by Rule 22e-4 under the Investment Company Act of 1940, as amended. The fund’s Board of Trustees (the “Board”) has designated MFS as the administrator of the Program. The Program is reasonably designed to assess and manage the liquidity risk of the fund. Liquidity risk is the risk that the fund could not meet requests to redeem shares issued by the fund without significant dilution of remaining investors' interests.
MFS provided a written report to the Board for consideration at its March 2024 meeting that addressed the operation of the Program and provided an assessment of the adequacy and effectiveness of the Program during the period from January 1, 2023 to December 31, 2023 (the “Covered Period”). The report concluded that during the Covered Period the Program had operated effectively in all material respects and had adequately and effectively been implemented to assess and manage the fund’s liquidity risk. MFS also reported that there were no liquidity events that impacted the fund or its ability to timely meet redemptions without dilution to existing shareholders during the Covered Period.
There can be no assurance that the Program will achieve its objectives in the future. Further information on liquidity risk, and other principal risks to which an investment in the fund may be subject, can be found in the prospectus.
Proxy Voting Policies and Information
MFS votes proxies on behalf of the fund pursuant to proxy voting policies and procedures that are available without charge, upon request, by calling 1-800-225-2606, by visiting mfs.com/proxyvoting, or by visiting the SEC’s Web site at http://www.sec.gov.
Information regarding how the fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available by August 31 of each year without charge by visiting mfs.com/proxyvoting, or by visiting the SEC’s Web site at http://www.sec.gov.
Quarterly Portfolio Disclosure
The fund files a complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The fund's Form N-PORT reports are available on the SEC's Web site at http://www.sec.gov. A shareholder can obtain the portfolio holdings report for the first and third quarters of the fund's fiscal year at mfs.com/openendfunds by choosing the fund's name and then scrolling to the “Resources” section and clicking on the “Prospectus and Reports” tab.
Further Information
From time to time, MFS may post important information about the fund or the MFS Funds on the MFS Web site (mfs.com). This information is available at https://www.mfs.com/announcements or at mfs.com/openendfunds by choosing the fund’s name and then scrolling to the “Resources” section and clicking on the “Announcements” tab, if any.
Information About Fund Contracts and Legal Claims
The fund has entered into contractual arrangements with an investment adviser, administrator, distributor, shareholder servicing agent, and custodian who each provide services to the fund. Unless expressly stated otherwise, shareholders are not parties to, or intended beneficiaries of these contractual arrangements, and these contractual arrangements are not intended to create any shareholder right to enforce them against the service providers or to seek any remedy under them against the service providers, either directly or on behalf of the fund.
Under the Trust’s By-Laws and Declaration of Trust, any claims asserted against or on behalf of the MFS Funds, including claims against Trustees and Officers, must be brought in state and federal courts located within the Commonwealth of Massachusetts.
Provision of Financial Reports and Summary Prospectuses
The fund produces financial reports every six months and updates its summary prospectus and prospectus annually. To avoid sending duplicate copies of materials to households, only one copy of the fund’s annual and semiannual report and summary prospectus may be mailed to shareholders having the same last name and residential address on the fund’s records. However, any shareholder may contact MFSC (please see back cover for address and telephone number) to request that copies of these reports and summary prospectuses be sent personally to that shareholder.
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CONTACT
WEB SITE
mfs.com
MFS TALK
1-800-637-8255
24 hours a day
ACCOUNT SERVICE AND LITERATURE
Shareholders
1-800-225-2606
Financial advisors
1-800-343-2829
Retirement plan services
1-800-637-1255
MAILING ADDRESS
MFS Service Center, Inc.
P.O. Box 219341
Kansas City, MO 64121-9341
OVERNIGHT MAIL
MFS Service Center, Inc.
Suite 219341
430 W 7th Street
Kansas City, MO 64105-1407
Semiannual Report
March 31, 2024
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The report is prepared for the general information of shareholders. It is authorized for distribution to prospective investors only when preceded or accompanied by a current prospectus.
NOT FDIC INSURED • MAY LOSE VALUE • NO BANK GUARANTEE
Portfolio structure
Top ten holdings
| Microsoft Corp. | 8.8% |
| Amazon.com, Inc. | 4.3% |
| Alphabet, Inc., “A” | 3.7% |
| NVIDIA Corp. | 3.5% |
| Meta Platforms, Inc., “A” | 3.2% |
| Apple, Inc. | 2.9% |
| Visa, Inc., “A” | 2.6% |
| JPMorgan Chase & Co. | 2.2% |
| Salesforce, Inc. | 1.9% |
| Eli Lilly & Co. | 1.6% |
Global equity sectors (k)
| Technology | 36.0% |
| Health Care | 13.1% |
| Financial Services | 13.0% |
| Capital Goods | 12.4% |
| Consumer Cyclicals | 12.2% |
| Energy | 6.4% |
| Consumer Staples | 4.3% |
| Telecommunications/Cable Television | 1.9% |
| (k) | The sectors set forth above and the associated portfolio composition are based on MFS’ own custom sector classification methodology. |
Cash & Cash Equivalents includes any cash, investments in money market funds, short-term securities, and other assets less liabilities. Please see the Statement of Assets and Liabilities for additional information related to the fund’s cash position and other assets and liabilities.
Percentages are based on net assets as of March 31, 2024.
The portfolio is actively managed and current holdings may be different.
Expense Table
Fund expenses borne by the shareholders during the period,
October 1, 2023 through March 31, 2024
As a shareholder of the fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on certain purchase or redemption payments, and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the fund 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 October 1, 2023 through March 31, 2024.
Actual Expenses
The first line for each share class in the following table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line for each share class in the following table provides information about hypothetical account values and hypothetical expenses based on the fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the fund 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 are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line for each share class in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Expense Table - continued
Share
Class | | Annualized
Expense
Ratio | Beginning
Account Value
10/01/23 | Ending
Account Value
3/31/24 | Expenses
Paid During
Period (p)
10/01/23-3/31/24 |
| A | Actual | 0.78% | $1,000.00 | $1,239.71 | $4.37 |
| Hypothetical (h) | 0.78% | $1,000.00 | $1,021.10 | $3.94 |
| B | Actual | 1.53% | $1,000.00 | $1,235.07 | $8.55 |
| Hypothetical (h) | 1.53% | $1,000.00 | $1,017.35 | $7.72 |
| C | Actual | 1.53% | $1,000.00 | $1,234.98 | $8.55 |
| Hypothetical (h) | 1.53% | $1,000.00 | $1,017.35 | $7.72 |
| I | Actual | 0.53% | $1,000.00 | $1,241.22 | $2.97 |
| Hypothetical (h) | 0.53% | $1,000.00 | $1,022.35 | $2.68 |
| R1 | Actual | 1.53% | $1,000.00 | $1,235.06 | $8.55 |
| Hypothetical (h) | 1.53% | $1,000.00 | $1,017.35 | $7.72 |
| R2 | Actual | 1.03% | $1,000.00 | $1,238.04 | $5.76 |
| Hypothetical (h) | 1.03% | $1,000.00 | $1,019.85 | $5.20 |
| R3 | Actual | 0.78% | $1,000.00 | $1,239.71 | $4.37 |
| Hypothetical (h) | 0.78% | $1,000.00 | $1,021.10 | $3.94 |
| R4 | Actual | 0.53% | $1,000.00 | $1,241.26 | $2.97 |
| Hypothetical (h) | 0.53% | $1,000.00 | $1,022.35 | $2.68 |
| R6 | Actual | 0.47% | $1,000.00 | $1,241.75 | $2.63 |
| Hypothetical (h) | 0.47% | $1,000.00 | $1,022.65 | $2.38 |
| (h) | 5% fund return per year before expenses. |
| (p) | “Expenses Paid During Period” are equal to each class’s annualized expense ratio, as shown above, multiplied by the average account value over the period, multiplied by 183/366 (to reflect the one-half year period). Expenses paid do not include any applicable sales charges (loads). If these transaction costs had been included, your costs would have been higher. |
Notes to Expense Table
Expense ratios include 0.02% of investment related expenses from short sales (See Note 2 of the Notes to Financial Statements).
Portfolio of Investments
3/31/24 (unaudited)
The Portfolio of Investments is a complete list of all securities owned by your fund. It is categorized by broad-based asset classes.
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – 99.3% |
| Aerospace & Defense – 2.9% | |
| Boeing Co. (a) | | 253,723 | $48,966,002 |
| General Dynamics Corp. | | 162,878 | 46,011,406 |
| Honeywell International, Inc. | | 268,761 | 55,163,195 |
| Howmet Aerospace, Inc. | | 665,925 | 45,569,248 |
| Leidos Holdings, Inc. | | 291,542 | 38,218,241 |
| | | | | $233,928,092 |
| Alcoholic Beverages – 0.5% | |
| Constellation Brands, Inc., “A” | | 154,466 | $41,977,680 |
| Apparel Manufacturers – 0.7% | |
| NIKE, Inc., “B” | | 611,087 | $57,429,956 |
| Automotive – 0.4% | |
| Aptiv PLC (a) | | 406,156 | $32,350,325 |
| Broadcasting – 1.3% | |
| Walt Disney Co. | | 855,546 | $104,684,609 |
| Brokerage & Asset Managers – 1.8% | |
| Charles Schwab Corp. | | 1,106,484 | $80,043,053 |
| CME Group, Inc. | | 309,279 | 66,584,676 |
| | | | | $146,627,729 |
| Business Services – 2.4% | |
| Accenture PLC, “A” | | 335,894 | $116,424,219 |
| TransUnion | | 595,635 | 47,531,673 |
| Tyler Technologies, Inc. (a) | | 63,988 | 27,195,540 |
| | | | | $191,151,432 |
| Cable TV – 0.5% | |
| Cable One, Inc. | | 100,343 | $42,458,134 |
| Computer Software – 12.5% | |
| Cadence Design Systems, Inc. (a) | | 343,451 | $106,909,427 |
| Microsoft Corp. (s) | | 1,681,698 | 707,523,983 |
| Palo Alto Networks, Inc. (a) | | 121,581 | 34,544,809 |
| Salesforce, Inc. | | 507,638 | 152,890,413 |
| | | | | $1,001,868,632 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Computer Software - Systems – 5.2% | |
| Apple, Inc. (s) | | 1,377,014 | $236,130,361 |
| Constellation Software, Inc. | | 27,872 | 76,133,328 |
| HubSpot, Inc. (a) | | 51,748 | 32,423,227 |
| ServiceNow, Inc. (a) | | 95,563 | 72,857,231 |
| | | | | $417,544,147 |
| Construction – 2.3% | |
| AZEK Co., Inc. (a) | | 702,675 | $35,288,338 |
| Sherwin-Williams Co. | | 170,439 | 59,198,578 |
| Summit Materials, Inc., “A” (a) | | 1,218,744 | 54,319,420 |
| Vulcan Materials Co. | | 138,115 | 37,694,346 |
| | | | | $186,500,682 |
| Consumer Products – 1.4% | |
| Colgate-Palmolive Co. | | 595,729 | $53,645,396 |
| International Flavors & Fragrances, Inc. | | 325,382 | 27,979,598 |
| Kenvue, Inc. | | 1,341,432 | 28,787,131 |
| | | | | $110,412,125 |
| Consumer Services – 0.7% | |
| Booking Holdings, Inc. | | 15,847 | $57,491,014 |
| Electrical Equipment – 1.1% | |
| Johnson Controls International PLC | | 726,639 | $47,464,060 |
| TE Connectivity Ltd. | | 277,855 | 40,355,660 |
| | | | | $87,819,720 |
| Electronics – 7.3% | |
| Applied Materials, Inc. | | 370,227 | $76,351,914 |
| Lam Research Corp. | | 83,477 | 81,103,749 |
| Marvell Technology, Inc. | | 1,115,665 | 79,078,335 |
| NVIDIA Corp. | | 309,104 | 279,294,010 |
| NXP Semiconductors N.V. | | 291,744 | 72,285,411 |
| | | | | $588,113,419 |
| Energy - Independent – 3.7% | |
| ConocoPhillips | | 975,287 | $124,134,529 |
| Diamondback Energy, Inc. | | 267,164 | 52,943,890 |
| Hess Corp. | | 452,520 | 69,072,653 |
| Valero Energy Corp. | | 270,246 | 46,128,290 |
| | | | | $292,279,362 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Food & Beverages – 1.8% | |
| General Mills, Inc. | | 290,885 | $20,353,223 |
| Mondelez International, Inc. | | 730,737 | 51,151,590 |
| PepsiCo, Inc. | | 434,751 | 76,085,773 |
| | | | | $147,590,586 |
| Gaming & Lodging – 0.6% | |
| Marriott International, Inc., “A” | | 199,319 | $50,290,177 |
| General Merchandise – 0.3% | |
| Five Below, Inc. (a) | | 139,517 | $25,305,594 |
| Health Maintenance Organizations – 1.4% | |
| Cigna Group | | 304,027 | $110,419,566 |
| Insurance – 2.7% | |
| Aon PLC | | 208,200 | $69,480,504 |
| Chubb Ltd. | | 402,478 | 104,294,124 |
| Willis Towers Watson PLC | | 159,687 | 43,913,925 |
| | | | | $217,688,553 |
| Internet – 8.6% | |
| Alphabet, Inc., “A” (a)(s) | | 1,960,958 | $295,967,391 |
| Alphabet, Inc., “C” (a) | | 589,982 | 89,830,659 |
| Gartner, Inc. (a) | | 109,408 | 52,151,511 |
| Meta Platforms, Inc., “A” | | 521,615 | 253,285,812 |
| | | | | $691,235,373 |
| Leisure & Toys – 0.6% | |
| Electronic Arts, Inc. | | 348,897 | $46,288,165 |
| Machinery & Tools – 2.8% | |
| Eaton Corp. PLC | | 208,970 | $65,340,740 |
| Ingersoll Rand, Inc. | | 591,415 | 56,154,854 |
| Regal Rexnord Corp. | | 238,407 | 42,937,101 |
| Wabtec Corp. | | 391,278 | 57,001,379 |
| | | | | $221,434,074 |
| Major Banks – 4.0% | |
| JPMorgan Chase & Co. | | 873,929 | $175,047,979 |
| Morgan Stanley | | 727,035 | 68,457,615 |
| PNC Financial Services Group, Inc. | | 495,395 | 80,055,832 |
| | | | | $323,561,426 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Medical & Health Technology & Services – 1.3% | |
| ICON PLC (a) | | 138,928 | $46,672,862 |
| McKesson Corp. | | 113,273 | 60,810,610 |
| | | | | $107,483,472 |
| Medical Equipment – 4.7% | |
| Agilent Technologies, Inc. | | 522,211 | $75,986,923 |
| Becton, Dickinson and Co. | | 250,898 | 62,084,710 |
| Boston Scientific Corp. (a) | | 1,077,351 | 73,787,770 |
| Masimo Corp. (a) | | 231,579 | 34,007,376 |
| Medtronic PLC | | 861,250 | 75,057,938 |
| STERIS PLC | | 232,998 | 52,382,610 |
| | | | | $373,307,327 |
| Oil Services – 0.5% | |
| Schlumberger Ltd. | | 664,073 | $36,397,841 |
| Other Banks & Diversified Financials – 3.6% | |
| Moody's Corp. | | 102,968 | $40,469,513 |
| Northern Trust Corp. | | 489,133 | 43,493,706 |
| Visa, Inc., “A” | | 737,443 | 205,805,593 |
| | | | | $289,768,812 |
| Pharmaceuticals – 5.8% | |
| AbbVie, Inc. | | 579,066 | $105,447,919 |
| Eli Lilly & Co. | | 167,677 | 130,445,999 |
| Johnson & Johnson | | 726,929 | 114,992,899 |
| Pfizer, Inc. | | 1,793,607 | 49,772,594 |
| Vertex Pharmaceuticals, Inc. (a) | | 147,648 | 61,718,340 |
| | | | | $462,377,751 |
| Railroad & Shipping – 0.8% | |
| Canadian Pacific Kansas City Ltd. (l) | | 716,782 | $63,198,669 |
| Real Estate – 0.8% | |
| Extra Space Storage, Inc., REIT | | 256,394 | $37,689,918 |
| Jones Lang LaSalle, Inc. (a) | | 126,182 | 24,616,846 |
| | | | | $62,306,764 |
| Restaurants – 0.9% | |
| Starbucks Corp. | | 779,330 | $71,222,969 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Specialty Chemicals – 1.6% | |
| Air Products & Chemicals, Inc. | | 173,216 | $41,965,040 |
| Corteva, Inc. | | 451,320 | 26,027,624 |
| DuPont de Nemours, Inc. | | 736,392 | 56,459,175 |
| | | | | $124,451,839 |
| Specialty Stores – 7.0% | |
| Amazon.com, Inc. (a)(s) | | 1,912,411 | $344,960,696 |
| Home Depot, Inc. | | 279,281 | 107,132,192 |
| Ross Stores, Inc. | | 380,810 | 55,887,676 |
| Target Corp. | | 308,473 | 54,664,500 |
| | | | | $562,645,064 |
| Telecommunications - Wireless – 1.4% | |
| SBA Communications Corp., REIT | | 436,889 | $94,673,847 |
| T-Mobile USA, Inc. | | 110,260 | 17,996,637 |
| | | | | $112,670,484 |
| Tobacco – 0.5% | |
| Philip Morris International, Inc. | | 442,212 | $40,515,463 |
| Trucking – 0.6% | |
| J.B. Hunt Transport Services, Inc. | | 235,891 | $47,001,282 |
| Utilities - Electric Power – 2.3% | |
| Alliant Energy Corp. | | 733,543 | $36,970,567 |
| CMS Energy Corp. | | 317,231 | 19,141,719 |
| Duke Energy Corp. | | 481,502 | 46,566,058 |
| PG&E Corp. | | 2,798,215 | 46,898,083 |
| PPL Corp. | | 1,214,660 | 33,439,590 |
| | | | | $183,016,017 |
| Total Common Stocks (Identified Cost, $4,414,239,345) | | $7,962,814,326 |
| | Strike
Price | First
Exercise | | |
| Warrants – 0.0% | | | | |
| Computer Software - Systems – 0.0% |
| Constellation Software, Inc. (CAD 100 principal amount of Series 2 Debentures for 1 warrant, Expiration 3/31/40) (a) (Identified Cost, $0) | CAD 11.5 | N/A | 30,929 | $0 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Investment Companies (h) – 0.2% |
| Money Market Funds – 0.2% | |
| MFS Institutional Money Market Portfolio, 5.38% (v) (Identified Cost, $13,487,648) | | | 13,487,614 | $13,490,311 |
| Collateral for Securities Loaned – 0.7% |
| JPMorgan U.S. Government Money Market Fund - Class IM Shares, 5.25% (j) (Identified Cost, $58,156,035) | | | 58,156,035 | $58,156,035 |
|
|
| Other Assets, Less Liabilities – (0.2)% | | (14,104,447) |
| Net Assets – 100.0% | $8,020,356,225 |
| (a) | Non-income producing security. | | | |
| (h) | An affiliated issuer, which may be considered one in which the fund owns 5% or more of the outstanding voting securities, or a company which is under common control. At period end, the aggregate values of the fund's investments in affiliated issuers and in unaffiliated issuers were $13,490,311 and $8,020,970,361, respectively. | | | |
| (j) | The rate quoted is the annualized seven-day yield of the fund at period end. | | | |
| (l) | A portion of this security is on loan. See Note 2 for additional information. | | | |
| (s) | Security or a portion of the security was pledged to cover collateral requirements for securities sold short. | | | |
| (v) | Affiliated issuer that is available only to investment companies managed by MFS. The rate quoted for the MFS Institutional Money Market Portfolio is the annualized seven-day yield of the fund at period end. | | | |
| The following abbreviations are used in this report and are defined: |
| REIT | Real Estate Investment Trust |
| Abbreviations indicate amounts shown in currencies other than the U.S. dollar. All amounts are stated in U.S. dollars unless otherwise indicated. A list of abbreviations is shown below: |
| CAD | Canadian Dollar |
At March 31, 2024, the fund had cash collateral of $378,362 and other liquid securities with an aggregate value of $14,376,666 to cover any collateral or margin obligations for securities sold short. Restricted cash and/or deposits with brokers in the Statement of Assets and Liabilities are comprised of cash collateral.
See Notes to Financial Statements
Financial Statements
Statement of Assets and Liabilities
At 3/31/24 (unaudited)
This statement represents your fund’s balance sheet, which details the assets and liabilities comprising the total value of the fund.
| Assets | |
| Investments in unaffiliated issuers, at value, including $56,878,732 of securities on loan (identified cost, $4,472,395,380) | $8,020,970,361 |
| Investments in affiliated issuers, at value (identified cost, $13,487,648) | 13,490,311 |
| Cash | 1,111,391 |
| Deposits with brokers for | |
| Securities sold short | 378,362 |
| Receivables for | |
| Investments sold | 63,917,816 |
| Fund shares sold | 6,951,308 |
| Interest and dividends | 5,217,621 |
| Other assets | 56,860 |
| Total assets | $8,112,094,030 |
| Liabilities | |
| Payables for | |
| Investments purchased | $20,111,211 |
| Fund shares reacquired | 9,641,909 |
| Collateral for securities loaned, at value | 58,156,035 |
| Payable to affiliates | |
| Investment adviser | 458,155 |
| Administrative services fee | 8,421 |
| Shareholder servicing costs | 1,126,825 |
| Distribution and service fees | 60,908 |
| Payable for independent Trustees' compensation | 22,052 |
| Accrued expenses and other liabilities | 2,152,289 |
| Total liabilities | $91,737,805 |
| Net assets | $8,020,356,225 |
| Net assets consist of | |
| Paid-in capital | $4,157,265,573 |
| Total distributable earnings (loss) | 3,863,090,652 |
| Net assets | $8,020,356,225 |
| Shares of beneficial interest outstanding | 134,146,309 |
Statement of Assets and Liabilities (unaudited) – continued
| | Net assets | Shares
outstanding | Net asset value
per share (a) |
| Class A | $1,518,512,393 | 25,827,351 | $58.79 |
| Class B | 5,316,217 | 105,189 | 50.54 |
| Class C | 48,688,511 | 974,113 | 49.98 |
| Class I | 4,361,640,321 | 71,606,765 | 60.91 |
| Class R1 | 3,930,301 | 80,878 | 48.60 |
| Class R2 | 16,188,603 | 288,564 | 56.10 |
| Class R3 | 32,175,009 | 553,435 | 58.14 |
| Class R4 | 11,974,178 | 203,724 | 58.78 |
| Class R6 | 2,021,930,692 | 34,506,290 | 58.60 |
| (a) | Maximum offering price per share was equal to the net asset value per share for all share classes, except for Class A, for which the maximum offering price per share was $62.38 [100 / 94.25 x $58.79]. On sales of $50,000 or more, the maximum offering price of Class A shares is reduced. A contingent deferred sales charge may be imposed on redemptions of Class A, Class B, and Class C shares. Redemption price per share was equal to the net asset value per share for Classes I, R1, R2, R3, R4, and R6. |
See Notes to Financial Statements
Financial Statements
Statement of Operations
Six months ended 3/31/24 (unaudited)
This statement describes how much your fund earned in investment income and accrued in expenses. It also describes any gains and/or losses generated by fund operations.
| Net investment income (loss) | |
| Income | |
| Dividends | $49,894,992 |
| Dividends from affiliated issuers | 1,258,937 |
| Other | 91,816 |
| Income on securities loaned | 46,178 |
| Foreign taxes withheld | (144,094) |
| Total investment income | $51,147,829 |
| Expenses | |
| Management fee | $15,702,417 |
| Distribution and service fees | 2,102,582 |
| Shareholder servicing costs | 2,019,273 |
| Administrative services fee | 307,221 |
| Independent Trustees' compensation | 62,201 |
| Custodian fee | 112,450 |
| Shareholder communications | 84,798 |
| Audit and tax fees | 34,891 |
| Legal fees | 19,612 |
| Dividend and interest expense on securities sold short | 695,889 |
| Interest expense and fees | 19,285 |
| Miscellaneous | 131,663 |
| Total expenses | $21,292,282 |
| Fees paid indirectly | (3,063) |
| Reduction of expenses by distributor | (2,951) |
| Net expenses | $21,286,268 |
| Net investment income (loss) | $29,861,561 |
Statement of Operations (unaudited) – continued
| Realized and unrealized gain (loss) |
| Realized gain (loss) (identified cost basis) | |
| Unaffiliated issuers | $356,777,476 |
| Affiliated issuers | (6,704) |
| Securities sold short | 5,124,421 |
| Foreign currency | (1,602) |
| Net realized gain (loss) | $361,893,591 |
| Change in unrealized appreciation or depreciation | |
| Unaffiliated issuers | $1,229,618,039 |
| Affiliated issuers | (3,126) |
| Securities sold short | (9,156,003) |
| Translation of assets and liabilities in foreign currencies | 418 |
| Net unrealized gain (loss) | $1,220,459,328 |
| Net realized and unrealized gain (loss) | $1,582,352,919 |
| Change in net assets from operations | $1,612,214,480 |
See Notes to Financial Statements
Financial Statements
Statements of Changes in Net Assets
These statements describe the increases and/or decreases in net assets resulting from operations, any distributions, and any shareholder transactions.
| | Six months ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 |
| Change in net assets | | |
| From operations | | |
| Net investment income (loss) | $29,861,561 | $65,161,694 |
| Net realized gain (loss) | 361,893,591 | 490,937,563 |
| Net unrealized gain (loss) | 1,220,459,328 | 596,534,776 |
| Change in net assets from operations | $1,612,214,480 | $1,152,634,033 |
| Total distributions to shareholders | $(483,676,450) | $(512,700,968) |
| Change in net assets from fund share transactions | $(139,456,759) | $(396,517,039) |
| Total change in net assets | $989,081,271 | $243,416,026 |
| Net assets | | |
| At beginning of period | 7,031,274,954 | 6,787,858,928 |
| At end of period | $8,020,356,225 | $7,031,274,954 |
See Notes to Financial Statements
Financial Statements
Financial Highlights
The financial highlights table is intended to help you understand the fund's financial performance for the semiannual period and the past 5 fiscal years. Certain information reflects financial results for a single fund share. The total returns in the table represent the rate that an investor would have earned (or lost) on an investment in the fund share class (assuming reinvestment of all distributions) held for the entire period.
| Class A | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $50.69 | $46.50 | $58.66 | $48.66 | $44.50 | $46.73 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.16 | $0.34 | $0.29 | $0.20 | $0.33 | $0.37 |
| Net realized and unrealized gain (loss) | 11.50 | 7.37 | (9.17) | 12.41 | 5.52 | 1.90 |
| Total from investment operations | $11.66 | $7.71 | $(8.88) | $12.61 | $5.85 | $2.27 |
| Less distributions declared to shareholders |
| From net investment income | $(0.30) | $(0.34) | $(0.19) | $(0.28) | $(0.35) | $(0.28) |
| From net realized gain | (3.26) | (3.18) | (3.09) | (2.33) | (1.34) | (4.22) |
| Total distributions declared to shareholders | $(3.56) | $(3.52) | $(3.28) | $(2.61) | $(1.69) | $(4.50) |
| Net asset value, end of period (x) | $58.79 | $50.69 | $46.50 | $58.66 | $48.66 | $44.50 |
| Total return (%) (r)(s)(t)(x) | 23.95(n) | 17.07 | (16.34) | 26.85 | 13.46 | 6.46 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 0.78(a) | 0.81 | 0.79 | 0.78 | 0.79 | 0.80 |
| Expenses after expense reductions (f) | 0.78(a) | 0.81 | 0.78 | 0.78 | 0.78 | 0.79 |
| Net investment income (loss) | 0.59(a) | 0.68 | 0.52 | 0.37 | 0.72 | 0.89 |
| Portfolio turnover | 10(n) | 24 | 17 | 26 | 36 | 32 |
| Net assets at end of period (000 omitted) | $1,518,512 | $1,288,552 | $1,198,757 | $1,536,575 | $1,290,401 | $1,452,740 |
| Supplemental Ratios (%): |
| Ratios of expenses to average net assets after expense reductions excluding short sale expenses and interest expense and fees (f) | 0.76(a) | 0.76 | 0.76 | 0.76 | 0.77 | 0.77 |
See Notes to Financial Statements
Financial Highlights – continued
| Class B | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $43.91 | $40.69 | $51.91 | $43.39 | $39.84 | $42.40 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $(0.04) | $(0.03) | $(0.12) | $(0.19) | $(0.01) | $0.05 |
| Net realized and unrealized gain (loss) | 9.93 | 6.43 | (8.01) | 11.04 | 4.93 | 1.66 |
| Total from investment operations | $9.89 | $6.40 | $(8.13) | $10.85 | $4.92 | $1.71 |
| Less distributions declared to shareholders |
| From net investment income | $— | $— | $— | $— | $(0.03) | $(0.05) |
| From net realized gain | (3.26) | (3.18) | (3.09) | (2.33) | (1.34) | (4.22) |
| Total distributions declared to shareholders | $(3.26) | $(3.18) | $(3.09) | $(2.33) | $(1.37) | $(4.27) |
| Net asset value, end of period (x) | $50.54 | $43.91 | $40.69 | $51.91 | $43.39 | $39.84 |
| Total return (%) (r)(s)(t)(x) | 23.51(n) | 16.18 | (16.97) | 25.91 | 12.61 | 5.63 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 1.53(a) | 1.56 | 1.53 | 1.53 | 1.54 | 1.55 |
| Expenses after expense reductions (f) | 1.53(a) | 1.56 | 1.53 | 1.53 | 1.54 | 1.54 |
| Net investment income (loss) | (0.16)(a) | (0.06) | (0.25) | (0.39) | (0.03) | 0.14 |
| Portfolio turnover | 10(n) | 24 | 17 | 26 | 36 | 32 |
| Net assets at end of period (000 omitted) | $5,316 | $5,386 | $7,126 | $12,047 | $13,373 | $17,765 |
| Supplemental Ratios (%): |
| Ratios of expenses to average net assets after expense reductions excluding short sale expenses and interest expense and fees (f) | 1.51(a) | 1.51 | 1.51 | 1.51 | 1.52 | 1.52 |
See Notes to Financial Statements
Financial Highlights – continued
| Class C | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $43.46 | $40.30 | $51.44 | $43.02 | $39.53 | $42.05 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $(0.04) | $(0.03) | $(0.11) | $(0.19) | $(0.01) | $0.05 |
| Net realized and unrealized gain (loss) | 9.82 | 6.37 | (7.94) | 10.94 | 4.90 | 1.65 |
| Total from investment operations | $9.78 | $6.34 | $(8.05) | $10.75 | $4.89 | $1.70 |
| Less distributions declared to shareholders |
| From net investment income | $— | $— | $— | $— | $(0.06) | $— |
| From net realized gain | (3.26) | (3.18) | (3.09) | (2.33) | (1.34) | (4.22) |
| Total distributions declared to shareholders | $(3.26) | $(3.18) | $(3.09) | $(2.33) | $(1.40) | $(4.22) |
| Net asset value, end of period (x) | $49.98 | $43.46 | $40.30 | $51.44 | $43.02 | $39.53 |
| Total return (%) (r)(s)(t)(x) | 23.50(n) | 16.19 | (16.97) | 25.90 | 12.62 | 5.64 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 1.53(a) | 1.56 | 1.54 | 1.53 | 1.55 | 1.55 |
| Expenses after expense reductions (f) | 1.53(a) | 1.56 | 1.54 | 1.53 | 1.54 | 1.55 |
| Net investment income (loss) | (0.16)(a) | (0.07) | (0.24) | (0.38) | (0.03) | 0.13 |
| Portfolio turnover | 10(n) | 24 | 17 | 26 | 36 | 32 |
| Net assets at end of period (000 omitted) | $48,689 | $44,532 | $47,651 | $68,140 | $70,785 | $71,371 |
| Supplemental Ratios (%): |
| Ratios of expenses to average net assets after expense reductions excluding short sale expenses and interest expense and fees (f) | 1.51(a) | 1.51 | 1.51 | 1.51 | 1.53 | 1.53 |
See Notes to Financial Statements
Financial Highlights – continued
| Class I | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $52.45 | $48.01 | $60.47 | $50.09 | $45.74 | $48.03 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.24 | $0.48 | $0.44 | $0.35 | $0.45 | $0.49 |
| Net realized and unrealized gain (loss) | 11.91 | 7.61 | (9.47) | 12.77 | 5.70 | 1.93 |
| Total from investment operations | $12.15 | $8.09 | $(9.03) | $13.12 | $6.15 | $2.42 |
| Less distributions declared to shareholders |
| From net investment income | $(0.43) | $(0.47) | $(0.34) | $(0.41) | $(0.46) | $(0.49) |
| From net realized gain | (3.26) | (3.18) | (3.09) | (2.33) | (1.34) | (4.22) |
| Total distributions declared to shareholders | $(3.69) | $(3.65) | $(3.43) | $(2.74) | $(1.80) | $(4.71) |
| Net asset value, end of period (x) | $60.91 | $52.45 | $48.01 | $60.47 | $50.09 | $45.74 |
| Total return (%) (r)(s)(t)(x) | 24.12(n) | 17.36 | (16.15) | 27.16 | 13.76 | 6.68 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 0.53(a) | 0.56 | 0.54 | 0.53 | 0.55 | 0.55 |
| Expenses after expense reductions (f) | N/A | N/A | N/A | N/A | N/A | N/A |
| Net investment income (loss) | 0.84(a) | 0.93 | 0.77 | 0.62 | 0.97 | 1.13 |
| Portfolio turnover | 10(n) | 24 | 17 | 26 | 36 | 32 |
| Net assets at end of period (000 omitted) | $4,361,640 | $3,701,927 | $3,665,406 | $4,577,919 | $3,492,027 | $2,835,696 |
| Supplemental Ratios (%): |
| Ratios of expenses to average net assets after expense reductions excluding short sale expenses and interest expense and fees (f) | 0.51(a) | 0.51 | 0.51 | 0.51 | 0.53 | 0.53 |
See Notes to Financial Statements
Financial Highlights – continued
| Class R1 | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $42.34 | $39.38 | $50.34 | $42.14 | $38.72 | $41.37 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $(0.04) | $(0.03) | $(0.11) | $(0.18) | $(0.02) | $0.04 |
| Net realized and unrealized gain (loss) | 9.56 | 6.22 | (7.76) | 10.71 | 4.81 | 1.60 |
| Total from investment operations | $9.52 | $6.19 | $(7.87) | $10.53 | $4.79 | $1.64 |
| Less distributions declared to shareholders |
| From net investment income | $— | $(0.05) | $— | $— | $(0.03) | $(0.07) |
| From net realized gain | (3.26) | (3.18) | (3.09) | (2.33) | (1.34) | (4.22) |
| Total distributions declared to shareholders | $(3.26) | $(3.23) | $(3.09) | $(2.33) | $(1.37) | $(4.29) |
| Net asset value, end of period (x) | $48.60 | $42.34 | $39.38 | $50.34 | $42.14 | $38.72 |
| Total return (%) (r)(s)(t)(x) | 23.51(n) | 16.20 | (16.98) | 25.92 | 12.62 | 5.62 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 1.53(a) | 1.56 | 1.54 | 1.53 | 1.54 | 1.55 |
| Expenses after expense reductions (f) | 1.53(a) | 1.56 | 1.54 | 1.53 | N/A | N/A |
| Net investment income (loss) | (0.16)(a) | (0.07) | (0.23) | (0.39) | (0.04) | 0.12 |
| Portfolio turnover | 10(n) | 24 | 17 | 26 | 36 | 32 |
| Net assets at end of period (000 omitted) | $3,930 | $3,329 | $2,933 | $3,416 | $3,596 | $4,187 |
| Supplemental Ratios (%): |
| Ratios of expenses to average net assets after expense reductions excluding short sale expenses and interest expense and fees (f) | 1.51(a) | 1.51 | 1.51 | 1.51 | 1.53 | 1.53 |
See Notes to Financial Statements
Financial Highlights – continued
| Class R2 | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $48.30 | $44.44 | $56.29 | $46.78 | $42.85 | $45.23 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.09 | $0.21 | $0.14 | $0.06 | $0.20 | $0.25 |
| Net realized and unrealized gain (loss) | 10.97 | 7.04 | (8.76) | 11.92 | 5.33 | 1.82 |
| Total from investment operations | $11.06 | $7.25 | $(8.62) | $11.98 | $5.53 | $2.07 |
| Less distributions declared to shareholders |
| From net investment income | $— | $(0.21) | $(0.14) | $(0.14) | $(0.26) | $(0.23) |
| From net realized gain | (3.26) | (3.18) | (3.09) | (2.33) | (1.34) | (4.22) |
| Total distributions declared to shareholders | $(3.26) | $(3.39) | $(3.23) | $(2.47) | $(1.60) | $(4.45) |
| Net asset value, end of period (x) | $56.10 | $48.30 | $44.44 | $56.29 | $46.78 | $42.85 |
| Total return (%) (r)(s)(t)(x) | 23.80(n) | 16.78 | (16.55) | 26.53 | 13.19 | 6.18 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 1.03(a) | 1.06 | 1.04 | 1.03 | 1.04 | 1.05 |
| Expenses after expense reductions (f) | N/A | N/A | N/A | N/A | N/A | N/A |
| Net investment income (loss) | 0.34(a) | 0.44 | 0.27 | 0.12 | 0.47 | 0.63 |
| Portfolio turnover | 10(n) | 24 | 17 | 26 | 36 | 32 |
| Net assets at end of period (000 omitted) | $16,189 | $13,611 | $32,036 | $43,862 | $19,726 | $21,738 |
| Supplemental Ratios (%): |
| Ratios of expenses to average net assets after expense reductions excluding short sale expenses and interest expense and fees (f) | 1.01(a) | 1.02 | 1.01 | 1.02 | 1.03 | 1.03 |
See Notes to Financial Statements
Financial Highlights – continued
| Class R3 | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $50.16 | $46.05 | $58.12 | $48.23 | $44.12 | $46.46 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.16 | $0.34 | $0.28 | $0.20 | $0.32 | $0.37 |
| Net realized and unrealized gain (loss) | 11.38 | 7.29 | (9.08) | 12.29 | 5.48 | 1.86 |
| Total from investment operations | $11.54 | $7.63 | $(8.80) | $12.49 | $5.80 | $2.23 |
| Less distributions declared to shareholders |
| From net investment income | $(0.30) | $(0.34) | $(0.18) | $(0.27) | $(0.35) | $(0.35) |
| From net realized gain | (3.26) | (3.18) | (3.09) | (2.33) | (1.34) | (4.22) |
| Total distributions declared to shareholders | $(3.56) | $(3.52) | $(3.27) | $(2.60) | $(1.69) | $(4.57) |
| Net asset value, end of period (x) | $58.14 | $50.16 | $46.05 | $58.12 | $48.23 | $44.12 |
| Total return (%) (r)(s)(t)(x) | 23.97(n) | 17.06 | (16.34) | 26.85 | 13.46 | 6.44 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 0.78(a) | 0.81 | 0.79 | 0.78 | 0.79 | 0.80 |
| Expenses after expense reductions (f) | N/A | N/A | N/A | N/A | N/A | N/A |
| Net investment income (loss) | 0.59(a) | 0.68 | 0.52 | 0.37 | 0.72 | 0.88 |
| Portfolio turnover | 10(n) | 24 | 17 | 26 | 36 | 32 |
| Net assets at end of period (000 omitted) | $32,175 | $35,981 | $34,133 | $43,493 | $40,434 | $44,941 |
| Supplemental Ratios (%): |
| Ratios of expenses to average net assets after expense reductions excluding short sale expenses and interest expense and fees (f) | 0.76(a) | 0.76 | 0.76 | 0.76 | 0.78 | 0.78 |
See Notes to Financial Statements
Financial Highlights – continued
| Class R4 | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $50.73 | $46.55 | $58.72 | $48.71 | $44.53 | $46.88 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.23 | $0.47 | $0.42 | $0.34 | $0.43 | $0.47 |
| Net realized and unrealized gain (loss) | 11.51 | 7.37 | (9.16) | 12.40 | 5.55 | 1.88 |
| Total from investment operations | $11.74 | $7.84 | $(8.74) | $12.74 | $5.98 | $2.35 |
| Less distributions declared to shareholders |
| From net investment income | $(0.43) | $(0.48) | $(0.34) | $(0.40) | $(0.46) | $(0.48) |
| From net realized gain | (3.26) | (3.18) | (3.09) | (2.33) | (1.34) | (4.22) |
| Total distributions declared to shareholders | $(3.69) | $(3.66) | $(3.43) | $(2.73) | $(1.80) | $(4.70) |
| Net asset value, end of period (x) | $58.78 | $50.73 | $46.55 | $58.72 | $48.71 | $44.53 |
| Total return (%) (r)(s)(t)(x) | 24.13(n) | 17.35 | (16.13) | 27.16 | 13.76 | 6.69 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 0.53(a) | 0.56 | 0.53 | 0.53 | 0.54 | 0.55 |
| Expenses after expense reductions (f) | N/A | N/A | N/A | N/A | N/A | N/A |
| Net investment income (loss) | 0.84(a) | 0.94 | 0.76 | 0.62 | 0.97 | 1.13 |
| Portfolio turnover | 10(n) | 24 | 17 | 26 | 36 | 32 |
| Net assets at end of period (000 omitted) | $11,974 | $9,985 | $11,620 | $16,260 | $14,246 | $16,869 |
| Supplemental Ratios (%): |
| Ratios of expenses to average net assets after expense reductions excluding short sale expenses and interest expense and fees (f) | 0.51(a) | 0.51 | 0.51 | 0.51 | 0.53 | 0.53 |
See Notes to Financial Statements
Financial Highlights – continued
| Class R6 | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $50.60 | $46.44 | $58.60 | $48.62 | $44.44 | $46.82 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.24 | $0.50 | $0.46 | $0.38 | $0.47 | $0.50 |
| Net realized and unrealized gain (loss) | 11.49 | 7.35 | (9.15) | 12.37 | 5.53 | 1.86 |
| Total from investment operations | $11.73 | $7.85 | $(8.69) | $12.75 | $6.00 | $2.36 |
| Less distributions declared to shareholders |
| From net investment income | $(0.47) | $(0.51) | $(0.38) | $(0.44) | $(0.48) | $(0.52) |
| From net realized gain | (3.26) | (3.18) | (3.09) | (2.33) | (1.34) | (4.22) |
| Total distributions declared to shareholders | $(3.73) | $(3.69) | $(3.47) | $(2.77) | $(1.82) | $(4.74) |
| Net asset value, end of period (x) | $58.60 | $50.60 | $46.44 | $58.60 | $48.62 | $44.44 |
| Total return (%) (r)(s)(t)(x) | 24.18(n) | 17.44 | (16.09) | 27.25 | 13.85 | 6.75 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 0.47(a) | 0.49 | 0.47 | 0.46 | 0.48 | 0.48 |
| Expenses after expense reductions (f) | N/A | N/A | N/A | N/A | N/A | N/A |
| Net investment income (loss) | 0.90(a) | 1.00 | 0.84 | 0.68 | 1.04 | 1.19 |
| Portfolio turnover | 10(n) | 24 | 17 | 26 | 36 | 32 |
| Net assets at end of period (000 omitted) | $2,021,931 | $1,927,972 | $1,788,197 | $2,180,565 | $1,632,527 | $1,433,024 |
| Supplemental Ratios (%): |
| Ratios of expenses to average net assets after expense reductions excluding short sale expenses and interest expense and fees (f) | 0.45(a) | 0.45 | 0.45 | 0.45 | 0.46 | 0.46 |
| (a) | Annualized. |
| (d) | Per share data is based on average shares outstanding. |
| (f) | Ratios do not reflect reductions from fees paid indirectly, if applicable. See Note 2 in the Notes to Financial Statements for additional information. |
| (n) | Not annualized. |
| (r) | Certain expenses have been reduced without which performance would have been lower. |
| (s) | From time to time the fund may receive proceeds from litigation settlements, without which performance would be lower. |
| (t) | Total returns do not include any applicable sales charges. |
| (x) | The net asset values and total returns have been calculated on net assets which include adjustments made in accordance with U.S. generally accepted accounting principles required at period end for financial reporting purposes. |
See Notes to Financial Statements
Notes to Financial Statements
(unaudited)
(1) Business and Organization
MFS Research Fund (the fund) is a diversified series of MFS Series Trust V (the trust). The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company.
The fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services - Investment Companies.
(2) Significant Accounting Policies
General — The preparation of financial statements in conformity with U.S. generally accepted accounting principles 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 increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. In the preparation of these financial statements, management has evaluated subsequent events occurring after the date of the fund’s Statement of Assets and Liabilities through the date that the financial statements were issued.
Balance Sheet Offsetting — The fund's accounting policy with respect to balance sheet offsetting is that, absent an event of default by the counterparty or a termination of the agreement, the International Swaps and Derivatives Association (ISDA) Master Agreement, or similar agreement, does not result in an offset of reported amounts of financial assets and financial liabilities in the Statement of Assets and Liabilities across transactions between the fund and the applicable counterparty. The fund's right to setoff may be restricted or prohibited by the bankruptcy or insolvency laws of the particular jurisdiction to which a specific master netting agreement counterparty is subject. Balance sheet offsetting disclosures, to the extent applicable to the fund, have been included in the fund’s Significant Accounting Policies note under the captions for each of the fund’s in-scope financial instruments and transactions.
Investment Valuations — Subject to its oversight, the fund's Board of Trustees has delegated primary responsibility for determining or causing to be determined the value of the fund’s investments to MFS as the fund's adviser, pursuant to the fund’s valuation policy and procedures which have been adopted by the adviser and approved by the Board. In accordance with Rule 2a-5 under the Investment Company Act of 1940, the Board of Trustees designated the adviser as the “valuation designee” of the fund. If the adviser, as valuation designee, determines that reliable market quotations are not readily available for an investment, the investment is valued at fair value as determined in good faith by the adviser in accordance with the adviser’s fair valuation policy and procedures.
Under the fund's valuation policy and procedures, equity securities, including restricted equity securities and equity securities sold short, are generally valued at the last sale or official closing price on their primary market or exchange as provided by a third-party pricing service. Equity securities, for which there were no sales reported that day, are generally valued at the last quoted daily bid quotation on their primary market or
Notes to Financial Statements (unaudited) - continued
exchange as provided by a third-party pricing service. Equity securities sold short, for which there were no sales reported that day, are generally valued at the last quoted daily ask quotation on their primary market or exchange as provided by a third-party pricing service. Short-term instruments with a maturity at issuance of 60 days or less may be valued at amortized cost, which approximates market value. Open-end investment companies are generally valued at net asset value per share. The values of foreign securities and other assets and liabilities expressed in foreign currencies are converted to U.S. dollars using the mean of bid and asked prices for rates provided by a third-party pricing service.
Under the fund’s valuation policy and procedures, market quotations are not considered to be readily available for debt instruments, floating rate loans, and many types of derivatives. These investments are generally valued at fair value based on information from third-party pricing services or otherwise determined by the adviser in accordance with the adviser’s fair valuation policy and procedures. Securities and other assets generally valued on the basis of information from a third-party pricing service may also be valued at a broker/dealer bid quotation. In determining values, third-party pricing services can utilize both transaction data and market information such as yield, quality, coupon rate, maturity, type of issue, trading characteristics, spreads and other market data. An investment may also be valued at fair value if the adviser determines that the investment’s value has been materially affected by events occurring after the close of the exchange or market on which the investment is principally traded (such as foreign exchange or market) and prior to the determination of the fund’s net asset value, or after the halt of trading of a specific security where trading does not resume prior to the close of the exchange or market on which the security is principally traded. Events that occur after foreign markets close (such as developments in foreign markets and significant movements in the U.S. markets) and prior to the determination of the fund’s net asset value may be deemed to have a material effect on the value of securities traded in foreign markets. Accordingly, the fund’s foreign equity securities may often be valued at fair value. The adviser generally relies on third-party pricing services or other information (such as the correlation with price movements of similar securities in the same or other markets; the type, cost and investment characteristics of the security; the business and financial condition of the issuer; and trading and other market data) to assist in determining whether to fair value and at what value to fair value an investment. The value of an investment for purposes of calculating the fund’s net asset value can differ depending on the source and method used to determine value. When fair valuation is used, the value of an investment used to determine the fund’s net asset value may differ from quoted or published prices for the same investment. There can be no assurance that the fund could obtain the fair value assigned to an investment if it were to sell the investment at the same time at which the fund determines its net asset value per share.
Various inputs are used in determining the value of the fund's assets or liabilities. These inputs are categorized into three broad levels. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an investment's level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fund's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the investment. Level 1 includes unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 includes other significant observable market-based inputs (including quoted prices for similar
Notes to Financial Statements (unaudited) - continued
securities, interest rates, prepayment speed, and credit risk). Level 3 includes significant unobservable inputs, which may include the adviser's own assumptions in determining the fair value of investments. The following is a summary of the levels used as of March 31, 2024 in valuing the fund's assets and liabilities:
| Financial Instruments | Level 1 | Level 2 | Level 3 | Total |
| Equity Securities: | | | | |
| United States | $7,823,482,329 | $— | $— | $7,823,482,329 |
| Canada | 139,331,997 | 0 | — | 139,331,997 |
| Mutual Funds | 71,646,346 | — | — | 71,646,346 |
| Total | $8,034,460,672 | $0 | $— | $8,034,460,672 |
For further information regarding security characteristics, see the Portfolio of Investments.
Foreign Currency Translation — Purchases and sales of foreign investments, income, and expenses are converted into U.S. dollars based upon currency exchange rates prevailing on the respective dates of such transactions or on the reporting date for foreign denominated receivables and payables. Gains and losses attributable to foreign currency exchange rates on sales of securities are recorded for financial statement purposes as net realized gains and losses on investments. Gains and losses attributable to foreign exchange rate movements on receivables, payables, income and expenses are recorded for financial statement purposes as foreign currency transaction gains and losses. That portion of both realized and unrealized gains and losses on investments that results from fluctuations in foreign currency exchange rates is not separately disclosed.
Short Sales — The fund entered into short sales whereby it sells a security it does not own in anticipation of a decline in the value of that security. The fund will realize a gain if the security price decreases and a loss if the security price increases between the date of the short sale and the date on which the fund replaces the borrowed security. Losses from short sales can exceed the proceeds of the security sold; and they can also exceed the potential loss from an ordinary buy and sell transaction. The amount of any premium, dividends, or interest the fund may be required to pay in connection with a short sale will be recognized as a fund expense. During the six months ended March 31, 2024, this expense amounted to $695,889. At March 31, 2024, the fund had no short sales outstanding.
Security Loans — Under its Securities Lending Agency Agreement with the fund, JPMorgan Chase and Co., as lending agent, loans the securities of the fund to certain qualified institutions (the “Borrowers”) approved by the fund. Security loans can be terminated at the discretion of either the lending agent or the fund and the related securities must be returned within the earlier of the standard trade settlement period for such securities or within three business days. The loans are collateralized by cash and/or U.S. Treasury and federal agency obligations in an amount typically at least equal to the market value of the securities loaned. On loans collateralized by cash, the cash collateral is invested in a money market fund. The market value of the loaned securities is determined at the close of business of the fund and any additional required collateral is delivered to the fund on the next business day. The lending agent provides the fund with indemnification against Borrower default. In the event of Borrower default, the lending agent will, for the benefit of the fund, either purchase securities identical to those loaned or, when such purchase is commercially impracticable, pay the
Notes to Financial Statements (unaudited) - continued
fund the market value of the loaned securities. In return, the lending agent assumes the fund's rights to the related collateral. If the collateral value is less than the cost to purchase identical securities, the lending agent is responsible for the shortfall, but only to the extent that such shortfall is not due to a decline in collateral value resulting from collateral reinvestment for which the fund bears the risk of loss. At period end, the fund had investment securities on loan, all of which were classified as equity securities in the fund's Portfolio of Investments, with a fair value of $56,878,732. The fair value of the fund's investment securities on loan and a related liability of $58,156,035 for cash collateral received on securities loaned are both presented gross in the Statement of Assets and Liabilities. The collateral on securities loaned exceeded the value of securities on loan at period end. The liability for cash collateral for securities loaned is carried at fair value, which is categorized as level 2 within the fair value hierarchy. A portion of the income generated upon investment of the collateral is remitted to the Borrowers, and the remainder is allocated between the fund and the lending agent. On loans collateralized by U.S. Treasury and/or federal agency obligations, a fee is received from the Borrower, and is allocated between the fund and the lending agent. Income from securities lending is separately reported in the Statement of Operations. The dividend and interest income earned on the securities loaned is accounted for in the same manner as other dividend and interest income.
Indemnifications — Under the fund's organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to the fund. Additionally, in the normal course of business, the fund enters into agreements with service providers that may contain indemnification clauses. The fund's maximum exposure under these agreements is unknown as this would involve future claims that may be made against the fund that have not yet occurred.
Investment Transactions and Income — Dividends received in cash are recorded on the ex-dividend date. Certain dividends from foreign securities will be recorded when the fund is informed of the dividend if such information is obtained subsequent to the ex-dividend date. Dividend payments received in additional securities are recorded on the ex-dividend date in an amount equal to the value of the security on such date.
The fund may receive proceeds from litigation settlements. Any proceeds received from litigation involving portfolio holdings are reflected in the Statement of Operations in realized gain/loss if the security has been disposed of by the fund or in unrealized gain/loss if the security is still held by the fund. Any other proceeds from litigation not related to portfolio holdings are reflected as other income in the Statement of Operations.
Investment transactions are recorded on the trade date. In determining the net gain or loss on securities sold, the cost of securities is determined on the identified cost basis.
Fees Paid Indirectly — The fund's custody fee may be reduced by a credit earned under an arrangement that measures the value of U.S. dollars deposited with the custodian by the fund. The amount of the credit, for the six months ended March 31, 2024, is shown as a reduction of total expenses in the Statement of Operations.
Tax Matters and Distributions — The fund intends to qualify as a regulated investment company, as defined under Subchapter M of the Internal Revenue Code, and to distribute all of its taxable income, including realized capital gains. As a result, no provision for federal income tax is required. The fund’s federal tax returns, when
Notes to Financial Statements (unaudited) - continued
filed, will remain subject to examination by the Internal Revenue Service for a three year period. Management has analyzed the fund’s tax positions taken on federal and state tax returns for all open tax years and does not believe that there are any uncertain tax positions that require recognition of a tax liability. Foreign taxes, if any, have been accrued by the fund in the accompanying financial statements in accordance with the applicable foreign tax law. Foreign income taxes may be withheld by certain countries in which the fund invests. Additionally, capital gains realized by the fund on securities issued in or by certain foreign countries may be subject to capital gains tax imposed by those countries.
Distributions to shareholders are recorded on the ex-dividend date. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from U.S. generally accepted accounting principles. Certain capital accounts in the financial statements are periodically adjusted for permanent differences in order to reflect their tax character. These adjustments have no impact on net assets or net asset value per share. Temporary differences which arise from recognizing certain items of income, expense, gain or loss in different periods for financial statement and tax purposes will reverse at some time in the future.
Book/tax differences primarily relate to wash sale loss deferrals and treating a portion of the proceeds from redemptions as a distribution for tax purposes.
The tax character of distributions made during the current period will be determined at fiscal year end. The tax character of distributions declared to shareholders for the last fiscal year is as follows:
| | Year ended
9/30/23 |
| Ordinary income (including any short-term capital gains) | $64,000,990 |
| Long-term capital gains | 448,699,978 |
| Total distributions | $512,700,968 |
The federal tax cost and the tax basis components of distributable earnings were as follows:
| As of 3/31/24 | |
| Cost of investments | $4,511,910,200 |
| Gross appreciation | 3,649,104,283 |
| Gross depreciation | (126,553,811) |
| Net unrealized appreciation (depreciation) | $3,522,550,472 |
| As of 9/30/23 | |
| Undistributed ordinary income | 37,267,938 |
| Undistributed long-term capital gain | 395,194,468 |
| Other temporary differences | (1,345) |
| Net unrealized appreciation (depreciation) | 2,302,091,561 |
The aggregate cost above includes prior fiscal year end tax adjustments, if applicable.
Multiple Classes of Shares of Beneficial Interest — The fund offers multiple classes of shares, which differ in their respective distribution and service fees. The fund's income, realized and unrealized gain (loss), and common expenses are allocated to shareholders based on the daily net assets of each class. Dividends are declared
Notes to Financial Statements (unaudited) - continued
separately for each class. Differences in per share dividend rates are generally due to differences in separate class expenses. Class B and Class C shares will convert to Class A shares approximately eight years after purchase. The fund’s distributions declared to shareholders as reported in the Statements of Changes in Net Assets are presented by class as follows:
| | Six months
ended
3/31/24 | | Year
ended
9/30/23 |
| Class A | $88,559,708 | | $89,561,564 |
| Class B | 372,810 | | 513,792 |
| Class C | 3,186,820 | | 3,591,652 |
| Class I | 256,180,197 | | 271,873,886 |
| Class R1 | 245,359 | | 241,164 |
| Class R2 | 905,053 | | 2,320,635 |
| Class R3 | 2,543,291 | | 2,576,989 |
| Class R4 | 721,929 | | 909,091 |
| Class R6 | 130,961,283 | | 141,112,195 |
| Total | $483,676,450 | | $512,700,968 |
(3) Transactions with Affiliates
Investment Adviser — The fund has an investment advisory agreement with MFS to provide overall investment management and related administrative services and facilities to the fund. The management fee is computed daily and paid monthly at the following annual rates based on the fund's average daily net assets:
| Up to $5 billion | 0.43% |
| In excess of $5 billion and up to $10 billion | 0.40% |
| In excess of $10 billion | 0.37% |
The management fee incurred for the six months ended March 31, 2024 was equivalent to an annual effective rate of 0.42% of the fund's average daily net assets.
Distributor — MFS Fund Distributors, Inc. (MFD), a wholly-owned subsidiary of MFS, as distributor, received $27,342 for the six months ended March 31, 2024, as its portion of the initial sales charge on sales of Class A shares of the fund.
The Board of Trustees has adopted a distribution plan for certain share classes pursuant to Rule 12b-1 of the Investment Company Act of 1940.
The fund's distribution plan provides that the fund will pay MFD for services provided by MFD and financial intermediaries in connection with the distribution and servicing of certain share classes. One component of the plan is a distribution fee paid to MFD and another component of the plan is a service fee paid to MFD. MFD may subsequently pay all, or a portion, of the distribution and/or service fees to financial intermediaries. The distribution and service fees are computed daily and paid monthly.
Notes to Financial Statements (unaudited) - continued
Distribution Plan Fee Table:
| | Distribution
Fee Rate (d) | Service
Fee Rate (d) | Total
Distribution
Plan (d) | Annual
Effective
Rate (e) | Distribution
and Service
Fee |
| Class A | — | 0.25% | 0.25% | 0.25% | $ 1,742,181 |
| Class B | 0.75% | 0.25% | 1.00% | 1.00% | 26,913 |
| Class C | 0.75% | 0.25% | 1.00% | 1.00% | 231,918 |
| Class R1 | 0.75% | 0.25% | 1.00% | 1.00% | 18,010 |
| Class R2 | 0.25% | 0.25% | 0.50% | 0.50% | 37,049 |
| Class R3 | — | 0.25% | 0.25% | 0.25% | 46,511 |
| Total Distribution and Service Fees | | | | | $2,102,582 |
| (d) | In accordance with the distribution plan for certain classes, the fund pays distribution and/or service fees equal to these annual percentage rates of each class’s average daily net assets. The distribution and service fee rates disclosed by class represent the current rates in effect at the end of the reporting period. Any rate changes, if applicable, are detailed below. |
| (e) | The annual effective rates represent actual fees incurred under the distribution plan for the six months ended March 31, 2024 based on each class's average daily net assets. MFD has voluntarily agreed to rebate a portion of each class's 0.25% service fee attributable to accounts for which there is no financial intermediary specified on the account except for accounts attributable to MFS or its affiliates' seed money. For the six months ended March 31, 2024, this rebate amounted to $2,947, $1, $2, and $1 for Class A, Class B, Class C, and Class R1 shares, respectively, and is included in the reduction of total expenses in the Statement of Operations. |
Certain Class A shares are subject to a contingent deferred sales charge (CDSC) in the event of a shareholder redemption within 18 months of purchase. Class B shares are subject to a CDSC in the event of a shareholder redemption within six years of purchase. Class C shares are subject to a CDSC in the event of a shareholder redemption within 12 months of purchase. All contingent deferred sales charges are paid to MFD and during the six months ended March 31, 2024, were as follows:
| | Amount |
| Class A | $393 |
| Class B | 375 |
| Class C | 1,422 |
Shareholder Servicing Agent — MFS Service Center, Inc. (MFSC), a wholly-owned subsidiary of MFS, receives a fee from the fund for its services as shareholder servicing agent calculated as a percentage of the average daily net assets of the fund as determined periodically under the supervision of the fund's Board of Trustees. For the six months ended March 31, 2024, the fee was $207,932, which equated to 0.0056% annually of the fund's average daily net assets. MFSC also receives reimbursement from the fund for out-of-pocket expenses, sub-accounting and other shareholder servicing costs which may be paid to affiliated and unaffiliated service providers. Class R6 shares do not incur sub-accounting fees. For the six months ended March 31, 2024, these out-of-pocket expenses, sub-accounting and other shareholder servicing costs amounted to $1,811,341.
Notes to Financial Statements (unaudited) - continued
Administrator — MFS provides certain financial, legal, shareholder communications, compliance, and other administrative services to the fund. Under an administrative services agreement, the fund reimburses MFS the costs incurred to provide these services. The fund is charged an annual fixed amount of $17,500 plus a fee based on average daily net assets. The administrative services fee is computed daily and paid monthly. The administrative services fee incurred for the six months ended March 31, 2024 was equivalent to an annual effective rate of 0.0082% of the fund's average daily net assets.
Trustees’ and Officers’ Compensation — The fund pays compensation to independent Trustees in the form of a retainer, attendance fees, and additional compensation to Board and Committee chairpersons. Independent Trustees’ compensation is accrued daily and paid subsequent to each Trustee Board meeting. The fund does not pay compensation directly to Trustees or officers of the fund who are also officers of the investment adviser, all of whom receive remuneration from MFS for their services to the fund. Certain officers and Trustees of the fund are officers or directors of MFS, MFD, and MFSC.
Prior to December 31, 2001, the fund had an unfunded defined benefit plan (“DB plan”) for independent Trustees. As of December 31, 2001, the Board took action to terminate the DB plan with respect to then-current and any future independent Trustees, such that the DB plan covers only certain of those former independent Trustees who retired on or before December 31, 2001. The DB plan resulted in a pension expense of $482 and is included in “Independent Trustees’ compensation” in the Statement of Operations for the six months ended March 31, 2024. The liability for deferred retirement benefits payable to those former independent Trustees under the DB plan amounted to $770 at March 31, 2024, and is included in “Payable for independent Trustees’ compensation” in the Statement of Assets and Liabilities. The deferred retirement benefits compensation fee is accrued daily and paid monthly.
Other — The fund invests in the MFS Institutional Money Market Portfolio which is managed by MFS and seeks current income consistent with preservation of capital and liquidity. This money market fund does not pay a management fee to MFS but does incur investment and operating costs.
During the six months ended March 31, 2024, pursuant to a policy adopted by the Board of Trustees and designed to comply with Rule 17a-7 under the Investment Company Act of 1940 (the “Act”) and relevant guidance, the fund engaged in purchase transactions with funds and accounts for which MFS serves as investment adviser or sub-adviser (“cross-trades”) which amounted to $7,134,145.
The adviser has voluntarily undertaken to reimburse the fund from its own resources on a quarterly basis for the cost of investment research embedded in the cost of the fund’s securities trades. This agreement may be rescinded at any time. For the six months ended March 31, 2024, this reimbursement amounted to $91,816, which is included in “Other” income in the Statement of Operations.
(4) Portfolio Securities
For the six months ended March 31, 2024, purchases and sales of investments, other than short-term obligations, aggregated $706,578,781 and $1,325,874,690, respectively.
Notes to Financial Statements (unaudited) - continued
(5) Shares of Beneficial Interest
The fund's Declaration of Trust permits the Trustees to issue an unlimited number of full and fractional shares of beneficial interest. Transactions in fund shares were as follows:
| | Six months ended
3/31/24 | | Year ended
9/30/23 |
| | Shares | Amount | | Shares | Amount |
| Shares sold | | | | | |
| Class A | 532,628 | $28,595,705 | | 906,432 | $44,851,432 |
| Class B | 1,288 | 58,866 | | 68 | 2,850 |
| Class C | 53,904 | 2,481,339 | | 81,565 | 3,497,465 |
| Class I | 5,485,709 | 307,010,792 | | 10,539,224 | 539,599,456 |
| Class R1 | 2,169 | 97,336 | | 5,286 | 216,310 |
| Class R2 | 13,768 | 698,291 | | 95,531 | 4,585,182 |
| Class R3 | 21,202 | 1,126,633 | | 52,938 | 2,608,656 |
| Class R4 | 9,450 | 512,859 | | 26,663 | 1,317,928 |
| Class R6 | 362,218 | 19,471,089 | | 1,547,310 | 75,599,899 |
| | 6,482,336 | $360,052,910 | | 13,255,017 | $672,279,178 |
Shares issued to shareholders
in reinvestment of distributions | | | | | |
| Class A | 1,599,792 | $82,949,226 | | 1,748,944 | $83,302,157 |
| Class B | 8,315 | 371,423 | | 12,303 | 510,843 |
| Class C | 68,149 | 3,010,135 | | 82,683 | 3,397,461 |
| Class I | 4,734,164 | 254,082,569 | | 5,483,263 | 269,721,721 |
| Class R1 | 5,712 | 245,359 | | 6,025 | 241,164 |
| Class R2 | 18,280 | 905,053 | | 51,025 | 2,320,635 |
| Class R3 | 49,606 | 2,543,291 | | 54,667 | 2,576,989 |
| Class R4 | 12,238 | 633,825 | | 17,349 | 825,457 |
| Class R6 | 2,495,913 | 128,863,975 | | 2,931,232 | 139,028,313 |
| | 8,992,169 | $473,604,856 | | 10,387,491 | $501,924,740 |
| Shares reacquired | | | | | |
| Class A | (1,726,955) | $(92,529,678) | | (3,014,342) | $(149,559,449) |
| Class B | (27,068) | (1,259,505) | | (64,870) | (2,803,020) |
| Class C | (172,655) | (7,936,178) | | (322,045) | (13,738,300) |
| Class I | (9,192,310) | (513,625,203) | | (21,786,678) | (1,118,367,833) |
| Class R1 | (5,629) | (256,998) | | (7,164) | (297,087) |
| Class R2 | (25,307) | (1,288,214) | | (585,679) | (27,994,526) |
| Class R3 | (234,713) | (13,013,751) | | (131,507) | (6,429,468) |
| Class R4 | (14,805) | (808,729) | | (96,813) | (4,936,517) |
| Class R6 | (6,452,036) | (342,396,269) | | (4,880,504) | (246,594,757) |
| | (17,851,478) | $(973,114,525) | | (30,889,602) | $(1,570,720,957) |
Notes to Financial Statements (unaudited) - continued
| | Six months ended
3/31/24 | | Year ended
9/30/23 |
| | Shares | Amount | | Shares | Amount |
| Net change | | | | | |
| Class A | 405,465 | $19,015,253 | | (358,966) | $(21,405,860) |
| Class B | (17,465) | (829,216) | | (52,499) | (2,289,327) |
| Class C | (50,602) | (2,444,704) | | (157,797) | (6,843,374) |
| Class I | 1,027,563 | 47,468,158 | | (5,764,191) | (309,046,656) |
| Class R1 | 2,252 | 85,697 | | 4,147 | 160,387 |
| Class R2 | 6,741 | 315,130 | | (439,123) | (21,088,709) |
| Class R3 | (163,905) | (9,343,827) | | (23,902) | (1,243,823) |
| Class R4 | 6,883 | 337,955 | | (52,801) | (2,793,132) |
| Class R6 | (3,593,905) | (194,061,205) | | (401,962) | (31,966,545) |
| | (2,376,973) | $(139,456,759) | | (7,247,094) | $(396,517,039) |
The fund is one of several mutual funds in which certain MFS funds may invest. The MFS funds do not invest in the underlying funds for the purpose of exercising management or control. At the end of the period, the MFS Growth Allocation Fund, the MFS Moderate Allocation Fund, the MFS Aggressive Growth Allocation Fund, and the MFS Conservative Allocation Fund were the owners of record of approximately 8%, 6%, 4%, and 3%, respectively, of the value of outstanding voting shares of the fund. In addition, the MFS Lifetime 2025 Fund, the MFS Lifetime 2030 Fund, the MFS Lifetime 2035 Fund, the MFS Lifetime 2040 Fund, the MFS Lifetime 2045 Fund, the MFS Lifetime 2050 Fund, the MFS Lifetime 2055 Fund, the MFS Lifetime 2060 Fund, the MFS Lifetime 2065 Fund, and the MFS Lifetime Income Fund were each the owners of record of less than 1% of the value of outstanding voting shares of the fund.
Effective June 1, 2019, purchases of the fund’s Class B shares were closed to new and existing investors subject to certain exceptions. Effective September 29, 2023, purchases of the fund's Class R1 and Class R2 shares were closed to new eligible investors.
(6) Line of Credit
The fund and certain other funds managed by MFS participate in a $1.45 billion unsecured committed line of credit of which $1.2 billion is reserved for use by the fund and certain other MFS U.S. funds. The line of credit is provided by a syndicate of banks under a credit agreement. Borrowings may be made for temporary financing needs. Interest is charged to each fund, based on its borrowings, generally at a rate equal to the highest of 1) Daily Simple SOFR (Secured Overnight Financing Rate) plus 0.10%, 2) the Federal Funds Effective Rate, or 3) the Overnight Bank Funding Rate, each plus an agreed upon spread. A commitment fee, based on the average daily unused portion of the committed line of credit, is allocated among the participating funds. The line of credit expires on March 13, 2025 unless extended or renewed. In addition, the fund and other funds managed by MFS have established unsecured uncommitted borrowing arrangements with certain banks for temporary financing needs. Interest is charged to each fund, based on its borrowings, at rates equal to customary reference rates plus an
Notes to Financial Statements (unaudited) - continued
agreed upon spread. For the six months ended March 31, 2024, the fund’s commitment fee and interest expense were $18,554 and $0, respectively, and are included in “Interest expense and fees” in the Statement of Operations.
(7) Investments in Affiliated Issuers
An affiliated issuer may be considered one in which the fund owns 5% or more of the outstanding voting securities, or a company which is under common control. For the purposes of this report, the following were affiliated issuers:
| Affiliated Issuers | Beginning
Value | Purchases | Sales
Proceeds | Realized
Gain
(Loss) | Change in
Unrealized
Appreciation or
Depreciation | Ending
Value |
| MFS Institutional Money Market Portfolio | $40,371,444 | $519,684,323 | $546,555,626 | $(6,704) | $(3,126) | $13,490,311 |
| Affiliated Issuers | Dividend
Income | Capital Gain
Distributions |
| MFS Institutional Money Market Portfolio | $1,258,937 | $— |
Statement Regarding Liquidity Risk Management Program
The fund has adopted and implemented a liquidity risk management program (the “Program”) as required by Rule 22e-4 under the Investment Company Act of 1940, as amended. The fund’s Board of Trustees (the “Board”) has designated MFS as the administrator of the Program. The Program is reasonably designed to assess and manage the liquidity risk of the fund. Liquidity risk is the risk that the fund could not meet requests to redeem shares issued by the fund without significant dilution of remaining investors' interests.
MFS provided a written report to the Board for consideration at its March 2024 meeting that addressed the operation of the Program and provided an assessment of the adequacy and effectiveness of the Program during the period from January 1, 2023 to December 31, 2023 (the “Covered Period”). The report concluded that during the Covered Period the Program had operated effectively in all material respects and had adequately and effectively been implemented to assess and manage the fund’s liquidity risk. MFS also reported that there were no liquidity events that impacted the fund or its ability to timely meet redemptions without dilution to existing shareholders during the Covered Period.
There can be no assurance that the Program will achieve its objectives in the future. Further information on liquidity risk, and other principal risks to which an investment in the fund may be subject, can be found in the prospectus.
Proxy Voting Policies and Information
MFS votes proxies on behalf of the fund pursuant to proxy voting policies and procedures that are available without charge, upon request, by calling 1-800-225-2606, by visiting mfs.com/proxyvoting, or by visiting the SEC’s Web site at http://www.sec.gov.
Information regarding how the fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available by August 31 of each year without charge by visiting mfs.com/proxyvoting, or by visiting the SEC’s Web site at http://www.sec.gov.
Quarterly Portfolio Disclosure
The fund files a complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The fund's Form N-PORT reports are available on the SEC's Web site at http://www.sec.gov. A shareholder can obtain the portfolio holdings report for the first and third quarters of the fund's fiscal year at mfs.com/openendfunds by choosing the fund's name and then scrolling to the “Resources” section and clicking on the “Prospectus and Reports” tab.
Further Information
From time to time, MFS may post important information about the fund or the MFS Funds on the MFS Web site (mfs.com). This information is available at https://www.mfs.com/announcements or at mfs.com/openendfunds by choosing the fund’s name and then scrolling to the “Resources” section and clicking on the “Announcements” tab, if any.
Information About Fund Contracts and Legal Claims
The fund has entered into contractual arrangements with an investment adviser, administrator, distributor, shareholder servicing agent, and custodian who each provide services to the fund. Unless expressly stated otherwise, shareholders are not parties to, or intended beneficiaries of these contractual arrangements, and these contractual arrangements are not intended to create any shareholder right to enforce them against the service providers or to seek any remedy under them against the service providers, either directly or on behalf of the fund.
Under the Trust’s By-Laws and Declaration of Trust, any claims asserted against or on behalf of the MFS Funds, including claims against Trustees and Officers, must be brought in state and federal courts located within the Commonwealth of Massachusetts.
Provision of Financial Reports and Summary Prospectuses
The fund produces financial reports every six months and updates its summary prospectus and prospectus annually. To avoid sending duplicate copies of materials to households, only one copy of the fund’s annual and semiannual report and summary prospectus may be mailed to shareholders having the same last name and residential address on the fund’s records. However, any shareholder may contact MFSC (please see back cover for address and telephone number) to request that copies of these reports and summary prospectuses be sent personally to that shareholder.
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CONTACT
WEB SITE
mfs.com
MFS TALK
1-800-637-8255
24 hours a day
ACCOUNT SERVICE AND LITERATURE
Shareholders
1-800-225-2606
Financial advisors
1-800-343-2829
Retirement plan services
1-800-637-1255
MAILING ADDRESS
MFS Service Center, Inc.
P.O. Box 219341
Kansas City, MO 64121-9341
OVERNIGHT MAIL
MFS Service Center, Inc.
Suite 219341
430 W 7th Street
Kansas City, MO 64105-1407
Semiannual Report
March 31, 2024
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The report is prepared for the general information of shareholders. It is authorized for distribution to prospective investors only when preceded or accompanied by a current prospectus.
NOT FDIC INSURED • MAY LOSE VALUE • NO BANK GUARANTEE
Portfolio structure (i)
Top ten holdings (i)
| Goldman Sachs Group, Inc. | 2.5% |
| JPMorgan Chase & Co. | 2.4% |
| U.S. Treasury Notes, 0.375%, 11/30/2025 | 2.4% |
| U.S. Treasury Note 5 yr Future - JUN 2024 | 2.1% |
| UMBS, TBA, 2.5%, 30 year (h) | 2.0% |
| Charles Schwab Corp. | 1.9% |
| U.S. Treasury Note 2 yr Future - JUN 2024 | 1.9% |
| Eaton Corp. PLC | 1.8% |
| Microsoft Corp. | 1.8% |
| Cigna Group | 1.8% |
Composition including fixed income credit quality (a)(i)
| AAA | 4.2% |
| AA | 1.8% |
| A | 4.8% |
| BBB | 7.2% |
| CCC (o) | 0.0% |
| U.S. Government | 7.5% |
| Federal Agencies | 12.2% |
| Not Rated | 3.9% |
| Non-Fixed Income | 61.4% |
| Cash & Cash Equivalents | 0.9% |
| Other | (3.9)% |
GICS equity sectors (g)
| Financials | 17.0% |
| Industrials | 9.9% |
| Health Care | 7.9% |
| Information Technology | 6.9% |
| Communication Services | 4.6% |
| Energy | 3.9% |
| Consumer Staples | 3.7% |
| Utilities | 2.8% |
| Materials | 2.4% |
| Consumer Discretionary | 2.3% |
Fixed income sectors (i)
| Mortgage-Backed Securities | 12.2% |
| Investment Grade Corporates | 11.9% |
| U.S. Treasury Securities | 11.3% |
| Collateralized Debt Obligations | 3.3% |
| Commercial Mortgage-Backed Securities | 1.8% |
| Asset-Backed Securities | 0.7% |
| Municipal Bonds | 0.3% |
| Emerging Markets Bonds | 0.1% |
| Non-U.S. Government Bonds (o) | 0.0% |
| U.S. Government Agencies (o) | 0.0% |
Portfolio Composition - continued
| (a) | For all securities other than those specifically described below, ratings are assigned to underlying securities utilizing ratings from Moody’s, Fitch, and Standard & Poor’s rating agencies and applying the following hierarchy: If all three agencies provide a rating, the middle rating (after dropping the highest and lowest ratings) is assigned; if two of the three agencies rate a security, the lower of the two is assigned. If none of the 3 rating agencies above assign a rating, but the security is rated by DBRS Morningstar, then the DBRS Morningstar rating is assigned. If none of the 4 rating agencies listed above rate the security, but the security is rated by the Kroll Bond Rating Agency (KBRA), then the KBRA rating is assigned. Ratings are shown in the S&P and Fitch scale (e.g., AAA). Securities rated BBB or higher are considered investment grade. All ratings are subject to change. U.S. Government includes securities issued by the U.S. Department of the Treasury. Federal Agencies includes rated and unrated U.S. Agency fixed-income securities, U.S. Agency mortgage-backed securities, and collateralized mortgage obligations of U.S. Agency mortgage-backed securities. |
Not Rated includes fixed income securities and fixed income derivatives that have not been rated by any rating agency. Non-Fixed Income includes equity securities (including convertible bonds and equity derivatives), ETFs and Options on ETFs, and/or commodity-linked derivatives.
The fund may or may not have held all of these instruments on this date. The fund is not rated by these agencies.
| (g) | The Global Industry Classification Standard (GICS®) was developed by and/or is the exclusive property of MSCI, Inc. and S&P Global Market Intelligence Inc. (“S&P Global Market Intelligence”). GICS is a service mark of MSCI and S&P Global Market Intelligence and has been licensed for use by MFS. MFS has applied its own internal sector/industry classification methodology for equity securities and non-equity securities that are unclassified by GICS. |
| (h) | UMBS may include both Fannie Mae and Freddie Mac securities. |
| (i) | For purposes of this presentation, the components include the value of securities, and reflect the impact of the equivalent exposure of derivative positions, if any. These amounts may be negative from time to time. Equivalent exposure is a calculated amount that translates the derivative position into a reasonable approximation of the amount of the underlying asset that the portfolio would have to hold at a given point in time to have the same price sensitivity that results from the portfolio’s ownership of the derivative contract. When dealing with derivatives, equivalent exposure is a more representative measure of the potential impact of a position on portfolio performance than value. The bond component will include any accrued interest amounts. |
Where the fund holds convertible bonds, they are treated as part of the equity portion of the portfolio.
Cash & Cash Equivalents includes any cash, investments in money market funds, short-term securities, and other assets less liabilities. Please see the Statement of Assets and Liabilities for additional information related to the fund’s cash position and other assets and liabilities.
Other includes equivalent exposure from currency derivatives and/or any offsets to derivative positions and may be negative.
Percentages are based on net assets as of March 31, 2024.
The portfolio is actively managed and current holdings may be different.
Expense Table
Fund expenses borne by the shareholders during the period,
October 1, 2023 through March 31, 2024
As a shareholder of the fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on certain purchase or redemption payments, and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the fund 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 October 1, 2023 through March 31, 2024.
Actual Expenses
The first line for each share class in the following table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line for each share class in the following table provides information about hypothetical account values and hypothetical expenses based on the fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the fund 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 are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line for each share class in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Expense Table - continued
Share
Class | | Annualized
Expense
Ratio | Beginning
Account Value
10/01/23 | Ending
Account Value
3/31/24 | Expenses
Paid During
Period (p)
10/01/23-3/31/24 |
| A | Actual | 0.72% | $1,000.00 | $1,138.30 | $3.85 |
| Hypothetical (h) | 0.72% | $1,000.00 | $1,021.40 | $3.64 |
| B | Actual | 1.47% | $1,000.00 | $1,134.03 | $7.84 |
| Hypothetical (h) | 1.47% | $1,000.00 | $1,017.65 | $7.41 |
| C | Actual | 1.47% | $1,000.00 | $1,134.30 | $7.84 |
| Hypothetical (h) | 1.47% | $1,000.00 | $1,017.65 | $7.41 |
| I | Actual | 0.47% | $1,000.00 | $1,139.78 | $2.51 |
| Hypothetical (h) | 0.47% | $1,000.00 | $1,022.65 | $2.38 |
| R1 | Actual | 1.47% | $1,000.00 | $1,133.73 | $7.84 |
| Hypothetical (h) | 1.47% | $1,000.00 | $1,017.65 | $7.41 |
| R2 | Actual | 0.97% | $1,000.00 | $1,136.81 | $5.18 |
| Hypothetical (h) | 0.97% | $1,000.00 | $1,020.15 | $4.90 |
| R3 | Actual | 0.72% | $1,000.00 | $1,138.14 | $3.85 |
| Hypothetical (h) | 0.72% | $1,000.00 | $1,021.40 | $3.64 |
| R4 | Actual | 0.47% | $1,000.00 | $1,140.06 | $2.51 |
| Hypothetical (h) | 0.47% | $1,000.00 | $1,022.65 | $2.38 |
| R6 | Actual | 0.39% | $1,000.00 | $1,140.14 | $2.09 |
| Hypothetical (h) | 0.39% | $1,000.00 | $1,023.05 | $1.97 |
| (h) | 5% class return per year before expenses. |
| (p) | “Expenses Paid During Period” are equal to each class’s annualized expense ratio, as shown above, multiplied by the average account value over the period, multiplied by 183/366 (to reflect the one-half year period). Expenses paid do not include any applicable sales charges (loads). If these transaction costs had been included, your costs would have been higher. |
Portfolio of Investments
3/31/24 (unaudited)
The Portfolio of Investments is a complete list of all securities owned by your fund. It is categorized by broad-based asset classes.
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – 60.7% |
| Aerospace & Defense – 1.9% | |
| General Dynamics Corp. | | 120,580 | $34,062,644 |
| Honeywell International, Inc. | | 228,040 | 46,805,210 |
| Howmet Aerospace, Inc. | | 346,854 | 23,735,219 |
| L3Harris Technologies, Inc. | | 213,857 | 45,572,927 |
| | | | | $150,176,000 |
| Alcoholic Beverages – 0.9% | |
| Constellation Brands, Inc., “A” | | 145,286 | $39,482,923 |
| Diageo PLC | | 774,734 | 28,606,432 |
| | | | | $68,089,355 |
| Automotive – 1.9% | |
| Aptiv PLC (a) | | 646,917 | $51,526,939 |
| Lear Corp. | | 302,378 | 43,808,525 |
| LKQ Corp. | | 1,019,881 | 54,471,844 |
| | | | | $149,807,308 |
| Broadcasting – 0.9% | |
| Omnicom Group, Inc. | | 584,966 | $56,601,310 |
| Warner Bros. Discovery, Inc. (a) | | 1,920,738 | 16,768,043 |
| | | | | $73,369,353 |
| Brokerage & Asset Managers – 2.9% | |
| Cboe Global Markets, Inc. | | 192,622 | $35,390,440 |
| Charles Schwab Corp. | | 2,115,020 | 153,000,547 |
| CME Group, Inc. | | 130,457 | 28,086,087 |
| Invesco Ltd. | | 930,108 | 15,430,492 |
| | | | | $231,907,566 |
| Business Services – 2.4% | |
| Accenture PLC, “A” | | 128,533 | $44,550,823 |
| Amdocs Ltd. | | 325,680 | 29,431,702 |
| Cognizant Technology Solutions Corp., “A” | | 385,811 | 28,276,088 |
| Fidelity National Information Services, Inc. | | 511,013 | 37,906,944 |
| Fiserv, Inc. (a) | | 327,595 | 52,356,233 |
| | | | | $192,521,790 |
| Cable TV – 1.7% | |
| Comcast Corp., “A” | | 3,167,922 | $137,329,419 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Chemicals – 0.7% | |
| PPG Industries, Inc. | | 385,666 | $55,883,003 |
| Computer Software – 2.7% | |
| Dun & Bradstreet Holdings, Inc. | | 3,712,747 | $37,275,980 |
| Microsoft Corp. | | 346,993 | 145,986,895 |
| Oracle Corp. | | 251,847 | 31,634,502 |
| | | | | $214,897,377 |
| Construction – 2.3% | |
| Masco Corp. | | 1,624,372 | $128,130,463 |
| Stanley Black & Decker, Inc. | | 400,716 | 39,242,118 |
| Summit Materials, Inc., “A” (a) | | 394,863 | 17,599,044 |
| | | | | $184,971,625 |
| Consumer Products – 0.7% | |
| Kenvue, Inc. | | 2,501,223 | $53,676,246 |
| Consumer Services – 0.3% | |
| Booking Holdings, Inc. | | 5,955 | $21,604,025 |
| Electrical Equipment – 1.5% | |
| Johnson Controls International PLC | | 1,803,197 | $117,784,828 |
| Electronics – 3.2% | |
| Analog Devices, Inc. | | 92,094 | $18,215,272 |
| Applied Materials, Inc. | | 185,165 | 38,186,578 |
| Intel Corp. | | 1,622,076 | 71,647,097 |
| NXP Semiconductors N.V. | | 329,902 | 81,739,819 |
| Taiwan Semiconductor Manufacturing Co. Ltd., ADR | | 291,290 | 39,630,004 |
| | | | | $249,418,770 |
| Energy - Independent – 2.9% | |
| ConocoPhillips | | 847,855 | $107,914,984 |
| Hess Corp. | | 497,187 | 75,890,624 |
| Pioneer Natural Resources Co. | | 185,650 | 48,733,125 |
| | | | | $232,538,733 |
| Energy - Integrated – 0.9% | |
| Chevron Corp. | | 149,747 | $23,621,092 |
| Suncor Energy, Inc. | | 1,354,484 | 49,987,564 |
| | | | | $73,608,656 |
| Food & Beverages – 0.2% | |
| Archer Daniels Midland Co. | | 291,155 | $18,287,446 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Health Maintenance Organizations – 1.8% | |
| Cigna Group | | 400,605 | $145,495,730 |
| Insurance – 3.7% | |
| Aon PLC | | 270,757 | $90,357,026 |
| Chubb Ltd. | | 338,872 | 87,811,902 |
| Travelers Cos., Inc. | | 170,287 | 39,189,850 |
| Willis Towers Watson PLC | | 269,366 | 74,075,650 |
| | | | | $291,434,428 |
| Internet – 0.9% | |
| Alphabet, Inc., “A” (a) | | 467,857 | $70,613,657 |
| Leisure & Toys – 0.2% | |
| Electronic Arts, Inc. | | 120,815 | $16,028,526 |
| Machinery & Tools – 2.9% | |
| Eaton Corp. PLC | | 467,141 | $146,065,648 |
| Ingersoll Rand, Inc. | | 221,840 | 21,063,708 |
| Regal Rexnord Corp. | | 352,905 | 63,558,190 |
| | | | | $230,687,546 |
| Major Banks – 7.6% | |
| Bank of America Corp. | | 3,212,843 | $121,831,007 |
| Goldman Sachs Group, Inc. | | 472,564 | 197,385,257 |
| JPMorgan Chase & Co. | | 943,288 | 188,940,586 |
| Morgan Stanley | | 650,155 | 61,218,595 |
| PNC Financial Services Group, Inc. | | 227,777 | 36,808,763 |
| | | | | $606,184,208 |
| Medical & Health Technology & Services – 1.6% | |
| ICON PLC (a) | | 137,465 | $46,181,367 |
| McKesson Corp. | | 153,196 | 82,243,272 |
| | | | | $128,424,639 |
| Medical Equipment – 1.7% | |
| Becton, Dickinson and Co. | | 160,567 | $39,732,304 |
| Boston Scientific Corp. (a) | | 324,088 | 22,196,787 |
| Medtronic PLC | | 827,830 | 72,145,385 |
| | | | | $134,074,476 |
| Metals & Mining – 0.2% | |
| Glencore PLC | | 3,014,233 | $16,560,615 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Common Stocks – continued |
| Other Banks & Diversified Financials – 1.7% | |
| Northern Trust Corp. | | 859,230 | $76,402,731 |
| Truist Financial Corp. | | 1,526,364 | 59,497,669 |
| | | | | $135,900,400 |
| Pharmaceuticals – 2.7% | |
| Johnson & Johnson | | 585,669 | $92,646,979 |
| Organon & Co. | | 527,296 | 9,913,165 |
| Pfizer, Inc. | | 2,828,521 | 78,491,458 |
| Roche Holding AG | | 139,392 | 35,502,957 |
| | | | | $216,554,559 |
| Railroad & Shipping – 1.1% | |
| Union Pacific Corp. | | 351,325 | $86,401,357 |
| Restaurants – 0.2% | |
| Wendy's Co. | | 784,392 | $14,777,945 |
| Specialty Chemicals – 1.3% | |
| Air Products & Chemicals, Inc. | | 40,724 | $9,866,204 |
| Axalta Coating Systems Ltd. (a) | | 1,446,888 | 49,758,478 |
| DuPont de Nemours, Inc. | | 572,685 | 43,907,759 |
| | | | | $103,532,441 |
| Specialty Stores – 0.3% | |
| Target Corp. | | 116,536 | $20,651,345 |
| Telecommunications - Wireless – 0.8% | |
| T-Mobile USA, Inc. | | 399,025 | $65,128,861 |
| Tobacco – 1.2% | |
| Altria Group, Inc. | | 513,775 | $22,410,866 |
| Philip Morris International, Inc. | | 760,625 | 69,688,462 |
| | | | | $92,099,328 |
| Utilities - Electric Power – 2.8% | |
| Dominion Energy, Inc. | | 201,599 | $9,916,655 |
| Duke Energy Corp. | | 587,565 | 56,823,411 |
| Exelon Corp. | | 766,701 | 28,804,957 |
| National Grid PLC | | 1,772,720 | 23,851,095 |
| PG&E Corp. | | 3,310,653 | 55,486,544 |
| Southern Co. | | 694,650 | 49,834,191 |
| | | | | $224,716,853 |
| Total Common Stocks (Identified Cost, $2,738,892,979) | | $4,825,138,414 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Bonds – 37.4% |
| Aerospace & Defense – 0.0% |
| BAE Systems PLC, 3.4%, 4/15/2030 (n) | | $ | 3,048,000 | $2,779,844 |
| Asset-Backed & Securitized – 5.7% |
| ACRES 2021-FL2 Issuer Ltd., “AS”, FLR, 7.189% ((SOFR - 1mo. + 0.11448%) + 1.75%), 1/15/2037 (n) | | $ | 6,082,500 | $5,986,784 |
| Arbor Realty Trust, Inc., CLO, 2021-FL1, “AS”, FLR, 6.64% ((SOFR - 1mo. + 0.11448%) + 1.2%), 12/15/2035 (n) | | | 6,771,500 | 6,672,426 |
| Arbor Realty Trust, Inc., CLO, 2021-FL2, “B”, FLR, 7.04% ((SOFR - 1mo. + 0.11448%) + 1.6%), 5/15/2036 (n) | | | 1,950,000 | 1,923,425 |
| Arbor Realty Trust, Inc., CLO, 2021-FL3, “B”, FLR, 7.039% ((SOFR - 1mo. + 0.11448%) + 1.6%), 8/15/2034 (n) | | | 5,818,000 | 5,628,327 |
| Arbor Realty Trust, Inc., CLO, 2022-FL1, “B”, FLR, 7.418% (SOFR - 30 day + 2.1%), 1/15/2037 (n) | | | 16,706,500 | 16,546,475 |
| AREIT 2019-CRE3 Trust, “AS”, FLR, 6.739% ((SOFR - 1mo. + 0.11448%) + 1.3%), 9/14/2036 (n) | | | 5,225,175 | 5,169,819 |
| AREIT 2022-CRE6 Trust, “B”, FLR, 7.168% (SOFR - 30 day + 1.85%), 1/20/2037 (n) | | | 10,151,500 | 9,866,710 |
| ARI Fleet Lease Trust, 2023-B, “A2”, 6.05%, 7/15/2032 (n) | | | 4,281,057 | 4,308,615 |
| Bain Capital Credit CLO Ltd., 2020-4A, “A1R”, FLR, 7.068% (SOFR - 3mo. + 1.75%), 10/20/2036 (n) | | | 11,516,802 | 11,547,517 |
| Bayview Financial Revolving Mortgage Loan Trust, FLR, 7.045% ((SOFR - 1mo. + 0.11448%) + 1.6%), 12/28/2040 (n) | | | 794,983 | 1,232,777 |
| Benchmark 2023-V3 Mortgage Trust, “A3”, 6.362%, 7/15/2056 | | | 1,190,323 | 1,244,044 |
| Brazos Securitization LLC, 5.243%, 9/01/2040 (n) | | | 5,403,000 | 5,466,283 |
| BSPRT 2021-FL6 Issuer Ltd., “AS”, FLR, 6.739% ((SOFR - 1mo. + 0.11448%) + 1.3%), 3/15/2036 (n) | | | 17,122,500 | 16,586,035 |
| BSPRT 2021-FL7 Issuer Ltd., “B”, FLR, 7.489% ((SOFR - 1mo. + 0.11448%) + 2.05%), 12/15/2038 (n) | | | 2,794,000 | 2,740,338 |
| BSPRT 2022-FL8 Issuer Ltd., “B”, FLR, 7.369% (SOFR - 30 day + 2.05%), 2/15/2037 (n) | | | 5,979,000 | 5,836,559 |
| Business Jet Securities LLC, 2021-1A, “A”, 2.162%, 4/15/2036 (n) | | | 2,183,432 | 2,042,805 |
| BXMT 2021-FL4 Ltd., “AS”, FLR, 6.739% ((SOFR - 1mo. + 0.11448%) + 1.3%), 5/15/2038 (n) | | | 16,816,500 | 15,589,055 |
| CHCP 2021-FL1 Ltd., “AS”, FLR, 6.741% ((SOFR - 1mo. + 0.11448%) + 1.3%), 2/15/2038 (n) | | | 7,049,000 | 6,984,996 |
| Columbia Cent CLO 28 Ltd., “A-2-R”, 7.278%, 11/07/2030 (n) | | | 11,264,069 | 11,272,089 |
| Commercial Mortgage Pass-Through Certificates, 2023-BNK46, “A4”, 5.745%, 8/15/2056 | | | 16,647,021 | 17,444,027 |
| Commercial Mortgage Trust, 2015-DC1, “A5”, 3.35%, 2/10/2048 | | | 7,000,000 | 6,855,193 |
| Commercial Mortgage Trust, 2015-LC21, “A4”, 3.708%, 7/10/2048 | | | 9,641,397 | 9,396,721 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Bonds – continued |
| Asset-Backed & Securitized – continued |
| Commercial Mortgage Trust, 2015-PC1, “A5”, 3.902%, 7/10/2050 | | $ | 11,000,000 | $10,776,805 |
| Consumers 2023 Securitization Funding LLC, 5.55%, 3/01/2028 | | | 4,816,000 | 4,828,899 |
| Credit Acceptance Auto Loan Trust, 2021-3A, “B”, 1.38%, 7/15/2030 (n) | | | 3,623,000 | 3,557,058 |
| CSAIL Commercial Mortgage Trust, 2015-C2, “A4”, 3.504%, 6/15/2057 | | | 5,534,308 | 5,396,851 |
| Cutwater 2015-1A Ltd., “AR”, FLR, 6.795% ((SOFR - 3mo. + 0.26161%) + 1.22%), 1/15/2029 (n) | | | 717,880 | 717,762 |
| Dryden Senior Loan Fund, 2013-26A, “AR”, CLO, FLR, 6.475% ((SOFR - 3mo. + 0.26161%) + 0.9%), 4/15/2029 (n) | | | 5,819,479 | 5,818,519 |
| Dryden Senior Loan Fund, 2018-55A, “A1”, CLO, FLR, 6.596% ((SOFR - 3mo. + 0.26161%) + 1.02%), 4/15/2031 (n) | | | 10,906,652 | 10,920,121 |
| Empire District Bondco LLC, 4.943%, 1/01/2033 | | | 4,396,000 | 4,377,625 |
| GLS Auto Select Receivables Trust, 2023-1A, “A2”, 6.27%, 8/16/2027 (n) | | | 13,034,013 | 13,086,105 |
| GLS Auto Select Receivables Trust, 2023-2A, 6.37%, 6/15/2028 (n) | | | 3,274,743 | 3,298,090 |
| GMAC Mortgage Corp. Loan Trust, FGIC, 5.805%, 10/25/2036 | | | 167,183 | 165,098 |
| GS Mortgage Securities Trust, 2015-GC30, “A4”, 3.382%, 5/10/2050 | | | 10,734,280 | 10,425,733 |
| JPMBB Commercial Mortgage Securities Trust, 2015-C28, “A4”, 3.227%, 10/15/2048 | | | 13,361,337 | 13,009,441 |
| Kubota Credit Owner Trust, 2023-2A, “A2”, 5.61%, 7/15/2026 (n) | | | 2,979,123 | 2,979,375 |
| LCCM 2021-FL2 Trust, “B”, FLR, 7.339% ((SOFR - 1mo. + 0.11448%) + 1.9%), 12/13/2038 (n) | | | 8,231,500 | 7,862,186 |
| LoanCore 2021-CRE5 Ltd., “AS”, FLR, 7.189% ((SOFR - 1mo. + 0.11448%) + 1.75%), 7/15/2036 (n) | | | 16,915,500 | 16,708,314 |
| MF1 2020-FL4 Ltd., “A”, FLR, 7.14% ((SOFR - 1mo. + 0.11448%) + 1.7%), 11/15/2035 (n) | | | 2,381,107 | 2,380,485 |
| MF1 2021-FL5 Ltd., “AS”, FLR, 6.64% ((SOFR - 1mo. + 0.11448%) + 1.2%), 7/15/2036 (n) | | | 17,497,000 | 17,215,578 |
| MF1 2022-FL8 Ltd., “B”, FLR, 7.276% (SOFR - 30 day + 1.95%), 2/19/2037 (n) | | | 7,392,231 | 7,239,644 |
| MF1 2023-FL12 LLC, FLR, “A”, 7.392% (SOFR - 1mo. + 2.066%), 10/19/2038 (n) | | | 14,505,000 | 14,523,153 |
| MidOcean Credit CLO, 2013-2A, “BR”, FLR, 7.231% ((SOFR - 3mo. + 0.26161%) + 1.65%), 1/29/2030 (n) | | | 12,682,806 | 12,647,852 |
| Morgan Stanley Bank of America Merrill Lynch Trust, 2017-C34, “A4”, 3.536%, 11/15/2052 | | | 4,195,516 | 3,907,134 |
| MSWF Commercial Mortgage Trust 2023-2, “A5”, 6.014%, 12/15/2056 | | | 7,477,126 | 7,999,014 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Bonds – continued |
| Asset-Backed & Securitized – continued |
| Neuberger Berman CLO Ltd., 2013-15A, “BR2”, FLR, 6.926% ((SOFR - 3mo. + 0.26161%) + 1.35%), 10/15/2029 (n) | | $ | 5,618,950 | $5,618,950 |
| Neuberger Berman CLO Ltd., 2015-20A, “ARR”, FLR, 6.736% ((SOFR - 3mo. + 0.26161%) + 1.16%), 7/15/2034 (n) | | | 5,725,000 | 5,728,509 |
| Nissan Master Owner Trust, 2024-A, “A”, 6% (SOFR - 1mo. + 0.67%), 2/15/2028 (n) | | | 5,130,663 | 5,134,768 |
| Oaktree CLO 2019-1A Ltd., “BR”, FLR, 7.329% ((SOFR - 3mo. + 0.26161%) + 1.75%), 4/22/2030 (n) | | | 16,678,518 | 16,608,518 |
| ReadyCap Commercial Mortgage Trust, 2021-FL5, “A”, FLR, 6.443% ((SOFR - 1mo. + 0.11448%) + 1%), 4/25/2038 (z) | | | 1,951,447 | 1,945,743 |
| ReadyCap Commercial Mortgage Trust, 2021-FL7, “B”, FLR, 7.243% ((SOFR - 1mo. + 0.11448%) + 1.8%), 11/25/2036 (z) | | | 3,695,000 | 3,610,872 |
| Residential Funding Mortgage Securities, Inc., FGIC, 3.812%, 12/25/2035 (d)(q) | | | 140,906 | 3,804 |
| Rockford Tower CLO 2020-1 Ltd., 2020-1A, “A2R”, FLR, 7.119% (SOFR - 3mo. + 1.8%), 1/20/2036 (n) | | | 18,536,627 | 18,595,499 |
| Starwood Commercial Mortgage, 2022-FL3, “AS”, FLR, 7.119% (SOFR - 30 day + 1.8%), 11/15/2038 (n) | | | 17,154,000 | 16,584,642 |
| Toyota Lease Owner Trust, 2023-A, “A2”, 5.3%, 8/20/2025 (n) | | | 2,673,551 | 2,670,307 |
| TPG Real Estate Finance, 2021-FL4, “A”, FLR, 6.639% ((SOFR - 1mo. + 0.11448%) + 1.2%), 3/15/2038 (n) | | | 11,298,531 | 11,162,249 |
| Virginia Power Fuel Securitization LLC, 5.088%, 5/01/2027 | | | 4,759,000 | 4,692,444 |
| Voya CLO 2012-4A Ltd., “A2R3”, FLR, 7.025% ((SOFR - 3mo. + 0.26161%) + 1.45%), 10/15/2030 (n) | | | 6,439,259 | 6,398,891 |
| Wells Fargo Commercial Mortgage Trust, 2015-NXS1, “A5”, 3.148%, 5/15/2048 | | | 6,507,931 | 6,321,353 |
| | | | | $455,258,411 |
| Automotive – 0.4% |
| Lear Corp., 4.25%, 5/15/2029 | | $ | 2,163,000 | $2,067,425 |
| Magna International, Inc., 2.45%, 6/15/2030 | | | 6,114,000 | 5,289,887 |
| Stellantis Finance US, Inc., 2.691%, 9/15/2031 (n) | | | 10,166,000 | 8,553,696 |
| Volkswagen Group of America Finance LLC, 3.35%, 5/13/2025 (n) | | | 12,232,000 | 11,940,150 |
| | | | | $27,851,158 |
| Broadcasting – 0.2% |
| Walt Disney Co., 3.5%, 5/13/2040 | | $ | 7,789,000 | $6,402,866 |
| WarnerMedia Holdings, Inc., 5.05%, 3/15/2042 | | | 9,836,000 | 8,453,975 |
| WarnerMedia Holdings, Inc., 5.141%, 3/15/2052 | | | 5,588,000 | 4,638,026 |
| | | | | $19,494,867 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Bonds – continued |
| Brokerage & Asset Managers – 0.4% |
| Charles Schwab Corp., 5.853% to 5/19/2033, FLR (SOFR - 1 day + 2.5%) to 5/19/2034 | | $ | 13,058,000 | $13,372,012 |
| Intercontinental Exchange, Inc., 2.1%, 6/15/2030 | | | 6,958,000 | 5,912,908 |
| LPL Holdings, Inc., 6.75%, 11/17/2028 | | | 1,274,000 | 1,334,272 |
| LPL Holdings, Inc., 4.375%, 5/15/2031 (n) | | | 14,519,000 | 13,214,348 |
| | | | | $33,833,540 |
| Building – 0.2% |
| Martin Marietta Materials, Inc., 2.5%, 3/15/2030 | | $ | 622,000 | $542,368 |
| Masco Corp., 2%, 2/15/2031 | | | 12,460,000 | 10,190,421 |
| Vulcan Materials Co., 3.5%, 6/01/2030 | | | 1,246,000 | 1,142,005 |
| | | | | $11,874,794 |
| Business Services – 0.6% |
| Equinix, Inc., 2.625%, 11/18/2024 | | $ | 9,037,000 | $8,854,972 |
| Equinix, Inc., 1.8%, 7/15/2027 | | | 5,883,000 | 5,273,743 |
| Equinix, Inc., 2.5%, 5/15/2031 | | | 7,470,000 | 6,231,131 |
| Experian Finance PLC, 4.25%, 2/01/2029 (n) | | | 4,011,000 | 3,876,721 |
| Fiserv, Inc., 2.65%, 6/01/2030 | | | 2,445,000 | 2,128,793 |
| Global Payments, Inc., 1.2%, 3/01/2026 | | | 6,442,000 | 5,959,027 |
| Global Payments, Inc., 2.9%, 11/15/2031 | | | 8,226,000 | 6,903,251 |
| Verisk Analytics, Inc., 4.125%, 3/15/2029 | | | 2,750,000 | 2,645,635 |
| Verisk Analytics, Inc., 5.75%, 4/01/2033 | | | 5,062,000 | 5,262,019 |
| | | | | $47,135,292 |
| Cable TV – 0.3% |
| Charter Communications Operating LLC/Charter Communications Operating Capital Corp., 6.384%, 10/23/2035 | | $ | 3,413,000 | $3,372,994 |
| Charter Communications Operating LLC/Charter Communications Operating Capital Corp., 3.5%, 6/01/2041 | | | 6,803,000 | 4,568,051 |
| Charter Communications Operating LLC/Charter Communications Operating Capital Corp., 5.375%, 5/01/2047 | | | 1,390,000 | 1,120,014 |
| Charter Communications Operating LLC/Charter Communications Operating Capital Corp., 5.25%, 4/01/2053 | | | 5,724,000 | 4,533,206 |
| Cox Communications, Inc., 1.8%, 10/01/2030 (n) | | | 4,310,000 | 3,457,845 |
| Time Warner Entertainment Co. LP, 8.375%, 7/15/2033 | | | 6,553,000 | 7,313,726 |
| | | | | $24,365,836 |
| Chemicals – 0.1% |
| RPM International, Inc., 2.95%, 1/15/2032 | | $ | 4,666,000 | $3,949,108 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Bonds – continued |
| Computer Software – 0.1% |
| Oracle Corp., 4.9%, 2/06/2033 | | $ | 2,585,000 | $2,530,840 |
| Roper Technologies, Inc., 2%, 6/30/2030 | | | 4,196,000 | 3,502,165 |
| | | | | $6,033,005 |
| Conglomerates – 0.1% |
| Westinghouse Air Brake Technologies Corp., 3.2%, 6/15/2025 | | $ | 2,623,000 | $2,547,418 |
| Westinghouse Air Brake Technologies Corp., 4.7%, 9/15/2028 | | | 6,723,000 | 6,612,741 |
| | | | | $9,160,159 |
| Consumer Products – 0.1% |
| Kenvue, Inc., 4.9%, 3/22/2033 | | $ | 10,448,000 | $10,439,175 |
| Consumer Services – 0.1% |
| Booking Holdings, Inc., 4.625%, 4/13/2030 | | $ | 4,593,000 | $4,536,293 |
| Electrical Equipment – 0.1% |
| Arrow Electronics, Inc., 2.95%, 2/15/2032 | | $ | 9,575,000 | $8,036,973 |
| Electronics – 0.1% |
| Broadcom, Inc., 4.3%, 11/15/2032 | | $ | 4,290,000 | $4,030,922 |
| Broadcom, Inc., 4.926%, 5/15/2037 (n) | | | 2,223,000 | 2,109,774 |
| | | | | $6,140,696 |
| Energy - Integrated – 0.3% |
| BP Capital Markets America, Inc., 2.721%, 1/12/2032 | | $ | 13,688,000 | $11,794,073 |
| Eni S.p.A., 4.75%, 9/12/2028 (n) | | | 11,589,000 | 11,498,504 |
| | | | | $23,292,577 |
| Financial Institutions – 0.4% |
| AerCap Ireland Capital DAC/AerCap Global Aviation Trust, 2.45%, 10/29/2026 | | $ | 13,587,000 | $12,617,697 |
| AerCap Ireland Capital DAC/AerCap Global Aviation Trust, 3.65%, 7/21/2027 | | | 7,729,000 | 7,309,490 |
| Avolon Holdings Funding Ltd., 4.375%, 5/01/2026 (n) | | | 2,248,000 | 2,171,087 |
| Avolon Holdings Funding Ltd., 3.25%, 2/15/2027 (n) | | | 7,097,000 | 6,590,844 |
| Avolon Holdings Funding Ltd., 2.528%, 11/18/2027 (n) | | | 5,867,000 | 5,218,054 |
| | | | | $33,907,172 |
| Food & Beverages – 0.3% |
| Anheuser-Busch InBev Worldwide, Inc., 4.375%, 4/15/2038 | | $ | 2,398,000 | $2,228,601 |
| Anheuser-Busch InBev Worldwide, Inc., 8%, 11/15/2039 | | | 9,558,000 | 12,080,688 |
| Diageo Capital PLC, 2.375%, 10/24/2029 | | | 8,369,000 | 7,393,348 |
| Keurig Dr Pepper, Inc., 3.2%, 5/01/2030 | | | 986,000 | 888,146 |
| | | | | $22,590,783 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Bonds – continued |
| Gaming & Lodging – 0.2% |
| GLP Capital LP/GLP Financing II, Inc., 5.3%, 1/15/2029 | | $ | 5,014,000 | $4,930,186 |
| Las Vegas Sands Corp., 3.9%, 8/08/2029 | | | 2,476,000 | 2,253,442 |
| Marriott International, Inc., 4.625%, 6/15/2030 | | | 6,716,000 | 6,533,965 |
| Marriott International, Inc., 2.85%, 4/15/2031 | | | 23,000 | 19,838 |
| Marriott International, Inc., 2.75%, 10/15/2033 | | | 5,250,000 | 4,266,773 |
| | | | | $18,004,204 |
| Insurance – 0.5% |
| AIA Group Ltd., 3.375%, 4/07/2030 (n) | | $ | 7,948,000 | $7,286,572 |
| Corebridge Financial, Inc., 3.9%, 4/05/2032 | | | 11,118,000 | 9,999,785 |
| Corebridge Financial, Inc., 5.75%, 1/15/2034 | | | 4,447,000 | 4,536,770 |
| Metropolitan Life Global Funding I, 3.3%, 3/21/2029 (n) | | | 15,225,000 | 14,043,806 |
| | | | | $35,866,933 |
| Insurance - Health – 0.1% |
| Humana, Inc., 5.875%, 3/01/2033 | | $ | 4,392,000 | $4,532,285 |
| Insurance - Property & Casualty – 0.3% |
| Aon Corp., 4.5%, 12/15/2028 | | $ | 6,955,000 | $6,813,309 |
| Aon Corp., 3.75%, 5/02/2029 | | | 1,627,000 | 1,536,961 |
| Brown & Brown, Inc., 4.2%, 3/17/2032 | | | 7,012,000 | 6,473,322 |
| Fairfax Financial Holdings Ltd., 5.625%, 8/16/2032 | | | 10,369,000 | 10,358,531 |
| Liberty Mutual Group, Inc., 3.951%, 10/15/2050 (n) | | | 3,061,000 | 2,301,700 |
| | | | | $27,483,823 |
| International Market Quasi-Sovereign – 0.0% |
| Electricite de France S.A., 6.9%, 5/23/2053 (n) | | $ | 2,221,000 | $2,421,474 |
| Machinery & Tools – 0.2% |
| Ashtead Capital, Inc., 5.5%, 8/11/2032 (n) | | $ | 14,128,000 | $13,812,297 |
| CNH Industrial Capital LLC, 1.875%, 1/15/2026 | | | 1,459,000 | 1,372,029 |
| | | | | $15,184,326 |
| Major Banks – 2.3% |
| Bank of America Corp., 2.572% to 10/20/2031, FLR (SOFR - 1 day + 1.21%) to 10/20/2032 | | $ | 11,722,000 | $9,724,842 |
| Barclays PLC, 2.894% to 11/24/2031, FLR (CMT - 1yr. + 1.3%) to 11/24/2032 | | | 3,616,000 | 3,006,958 |
| Barclays PLC, 7.437% to 11/02/2032, FLR (CMT - 1yr. + 3.5%) to 11/02/2033 | | | 9,484,000 | 10,534,417 |
| Capital One Financial Corp., 3.75%, 3/09/2027 | | | 5,440,000 | 5,221,204 |
| Capital One Financial Corp., 3.273% to 3/01/2029, FLR (SOFR - 1 day + 1.79%) to 3/01/2030 | | | 16,465,000 | 14,832,552 |
| Deutsche Bank AG, 7.146% to 7/13/2026, FLR (SOFR - 1 day + 2.52%) to 7/13/2027 | | | 2,981,000 | 3,063,611 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Bonds – continued |
| Major Banks – continued |
| Deutsche Bank AG, 2.311% to 11/16/2026, FLR (SOFR - 1 day + 1.219%) to 11/16/2027 | | $ | 2,877,000 | $2,630,332 |
| Deutsche Bank AG, 6.72% to 1/18/2028, FLR (SOFR - 1 day + 3.18%) to 1/18/2029 | | | 7,588,000 | 7,847,224 |
| Goldman Sachs Group, Inc., 2.6%, 2/07/2030 | | | 10,872,000 | 9,516,454 |
| Goldman Sachs Group, Inc., 2.383% to 7/21/2031, FLR (SOFR - 1 day + 1.248%) to 7/21/2032 | | | 9,008,000 | 7,389,781 |
| HSBC Holdings PLC, 4.7% to 9/09/2031, FLR (CMT - 1yr. + 3.25%) to 9/09/2169 | | | 3,072,000 | 2,583,451 |
| HSBC Holdings PLC, 4% to 9/09/2026, FLR (CMT - 1yr. + 3.222%) to 9/09/2170 | | | 1,215,000 | 1,128,735 |
| JPMorgan Chase & Co., 2.956% to 5/13/2030, FLR (SOFR - 1 day + 2.515%) to 5/13/2031 | | | 1,546,000 | 1,351,448 |
| JPMorgan Chase & Co., 2.545% to 11/08/2031, FLR (SOFR - 1 day + 1.18%) to 11/08/2032 | | | 15,046,000 | 12,519,877 |
| JPMorgan Chase & Co., 2.963% to 1/25/2032, FLR (SOFR - 1 day + 1.26%) to 1/25/2033 | | | 5,837,000 | 4,983,800 |
| JPMorgan Chase & Co., 3.109% to 4/22/2040, FLR (SOFR - 1 day + 2.46%) to 4/22/2041 | | | 7,872,000 | 5,998,160 |
| JPMorgan Chase & Co., 3.897% to 1/23/2048, FLR ((SOFR - 3mo. + 0.26161%) + 1.22%) to 1/23/2049 | | | 2,847,000 | 2,320,397 |
| Mitsubishi UFJ Financial Group, Inc., 2.852% to 1/19/2032, FLR (CMT - 1yr. + 1.1%) to 1/19/2033 | | | 9,207,000 | 7,817,947 |
| Morgan Stanley, 2.699% to 1/22/2030, FLR (SOFR - 1 day + 1.143%) to 1/22/2031 | | | 19,340,000 | 16,897,065 |
| Morgan Stanley, 2.943% to 1/21/2032, FLR (SOFR - 1 day + 1.29%) to 1/21/2033 | | | 10,273,000 | 8,731,265 |
| Sumitomo Mitsui Financial Group, Inc., 2.472%, 1/14/2029 | | | 17,106,000 | 15,285,013 |
| UBS Group AG, 2.095% to 2/11/2031, FLR (CMT - 1yr. + 1.0%) to 2/11/2032 (n) | | | 20,862,000 | 16,710,547 |
| Wells Fargo & Co., 3.35% to 3/02/2032, FLR (SOFR - 1 day + 1.5%) to 3/02/2033 | | | 17,236,000 | 14,954,430 |
| | | | | $185,049,510 |
| Medical & Health Technology & Services – 0.5% |
| Adventist Health System/West, 5.43%, 3/01/2032 | | $ | 8,829,000 | $8,911,649 |
| Alcon Finance Corp., 2.6%, 5/27/2030 (n) | | | 944,000 | 815,039 |
| Becton, Dickinson and Co., 4.669%, 6/06/2047 | | | 5,389,000 | 4,829,079 |
| Cigna Corp., 3.2%, 3/15/2040 | | | 1,517,000 | 1,148,341 |
| CVS Health Corp., 5.3%, 6/01/2033 | | | 9,092,000 | 9,113,374 |
| HCA, Inc., 5.125%, 6/15/2039 | | | 5,707,000 | 5,386,071 |
| Laboratory Corp. of America Holdings, 4.7%, 2/01/2045 | | | 3,373,000 | 3,046,568 |
| Northwell Healthcare, Inc., 3.979%, 11/01/2046 | | | 490,000 | 394,602 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Bonds – continued |
| Medical & Health Technology & Services – continued |
| Northwell Healthcare, Inc., 4.26%, 11/01/2047 | | $ | 3,797,000 | $3,146,502 |
| | | | | $36,791,225 |
| Medical Equipment – 0.1% |
| Boston Scientific Corp., 2.65%, 6/01/2030 | | $ | 5,104,000 | $4,495,336 |
| Metals & Mining – 0.3% |
| Anglo American Capital PLC, 3.875%, 3/16/2029 (n) | | $ | 1,639,000 | $1,533,340 |
| Anglo American Capital PLC, 5.625%, 4/01/2030 (n) | | | 4,259,000 | 4,315,782 |
| Anglo American Capital PLC, 2.625%, 9/10/2030 (n) | | | 14,840,000 | 12,632,995 |
| Glencore Funding LLC, 2.5%, 9/01/2030 (n) | | | 5,444,000 | 4,621,394 |
| Glencore Funding LLC, 2.85%, 4/27/2031 (n) | | | 2,292,000 | 1,958,414 |
| | | | | $25,061,925 |
| Midstream – 0.3% |
| Plains All American Pipeline LP, 3.8%, 9/15/2030 | | $ | 6,093,000 | $5,583,100 |
| Sabine Pass Liquefaction LLC, 4.5%, 5/15/2030 | | | 1,665,000 | 1,601,249 |
| Spectra Energy Partners LP, 3.375%, 10/15/2026 | | | 2,677,000 | 2,562,611 |
| Targa Resources Corp., 4.2%, 2/01/2033 | | | 2,470,000 | 2,251,893 |
| Targa Resources Corp., 6.125%, 3/15/2033 | | | 7,772,000 | 8,108,310 |
| | | | | $20,107,163 |
| Mortgage-Backed – 12.2% | |
| Fannie Mae, 5.25%, 8/01/2024 | | $ | 831,863 | $827,218 |
| Fannie Mae, 5%, 3/25/2025 - 3/01/2042 | | | 3,782,405 | 3,787,379 |
| Fannie Mae, 4.54%, 7/01/2026 | | | 849,170 | 842,344 |
| Fannie Mae, 3.95%, 1/01/2027 | | | 820,169 | 801,854 |
| Fannie Mae, 3%, 11/01/2028 - 9/01/2046 | | | 6,083,502 | 5,673,480 |
| Fannie Mae, 6.5%, 6/01/2031 - 7/01/2037 | | | 1,131,823 | 1,169,160 |
| Fannie Mae, 2.5%, 11/01/2031 | | | 133,423 | 124,501 |
| Fannie Mae, 5.5%, 2/01/2033 - 4/01/2040 | | | 5,176,087 | 5,271,003 |
| Fannie Mae, 3%, 2/25/2033 (i) | | | 646,728 | 51,943 |
| Fannie Mae, 4.5%, 8/01/2033 - 6/01/2044 | | | 10,018,102 | 9,807,243 |
| Fannie Mae, 6%, 1/01/2034 - 7/01/2037 | | | 3,107,379 | 3,190,682 |
| Fannie Mae, 3.5%, 4/01/2038 - 7/01/2046 | | | 26,920,021 | 24,710,694 |
| Fannie Mae, 3.25%, 5/25/2040 | | | 188,358 | 171,651 |
| Fannie Mae, 4%, 9/01/2040 - 6/01/2047 | | | 22,209,068 | 21,043,111 |
| Fannie Mae, 2%, 5/25/2044 - 4/25/2046 | | | 483,775 | 437,885 |
| Fannie Mae, 4%, 7/25/2046 (i) | | | 719,645 | 133,596 |
| Fannie Mae, UMBS, 2%, 11/01/2036 - 9/01/2052 | | | 107,218,443 | 88,633,049 |
| Fannie Mae, UMBS, 2.5%, 7/01/2037 - 8/01/2052 | | | 129,995,438 | 108,901,722 |
| Fannie Mae, UMBS, 5%, 10/01/2037 - 7/01/2053 | | | 11,619,530 | 11,352,188 |
| Fannie Mae, UMBS, 3%, 12/01/2037 - 7/01/2053 | | | 61,859,507 | 53,560,202 |
| Fannie Mae, UMBS, 4.5%, 5/01/2038 - 3/01/2053 | | | 5,552,266 | 5,325,739 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Bonds – continued |
| Mortgage-Backed – continued | |
| Fannie Mae, UMBS, 1.5%, 2/01/2042 - 4/01/2052 | | $ | 18,727,604 | $14,142,300 |
| Fannie Mae, UMBS, 3.5%, 5/01/2052 - 6/01/2053 | | | 8,349,961 | 7,483,121 |
| Fannie Mae, UMBS, 6%, 11/01/2052 - 11/01/2053 | | | 5,349,928 | 5,452,102 |
| Fannie Mae, UMBS, 5.5%, 3/01/2053 - 10/01/2053 | | | 19,169,265 | 19,074,283 |
| Fannie Mae, UMBS, 6.5%, 12/01/2053 | | | 2,371,051 | 2,422,358 |
| Freddie Mac, 0.941%, 4/25/2024 (i) | | | 1,022,058 | 89 |
| Freddie Mac, 0.548%, 7/25/2024 (i) | | | 40,823,000 | 50,576 |
| Freddie Mac, 0.639%, 7/25/2024 - 6/25/2027 (i) | | | 48,479,149 | 806,451 |
| Freddie Mac, 4.5%, 8/01/2024 - 5/01/2042 | | | 1,469,532 | 1,442,382 |
| Freddie Mac, 0.391%, 8/25/2024 (i) | | | 44,106,000 | 83,449 |
| Freddie Mac, 0.461%, 8/25/2024 (i) | | | 62,510,944 | 79,764 |
| Freddie Mac, 3.064%, 8/25/2024 | | | 1,936,873 | 1,917,289 |
| Freddie Mac, 0.348%, 10/25/2024 (i) | | | 43,763,061 | 49,522 |
| Freddie Mac, 3.171%, 10/25/2024 | | | 2,952,353 | 2,913,252 |
| Freddie Mac, 0.284%, 11/25/2024 - 11/25/2027 (i) | | | 77,654,287 | 371,773 |
| Freddie Mac, 2.67%, 12/25/2024 | | | 3,687,000 | 3,619,922 |
| Freddie Mac, 3.5%, 12/01/2025 - 10/25/2058 | | | 14,418,076 | 13,262,865 |
| Freddie Mac, 0.744%, 6/25/2027 (i) | | | 12,263,658 | 236,548 |
| Freddie Mac, 0.568%, 7/25/2027 - 12/25/2031 (i) | | | 72,800,475 | 1,932,377 |
| Freddie Mac, 0.327%, 8/25/2027 (i) | | | 27,934,000 | 314,210 |
| Freddie Mac, 0.417%, 8/25/2027 (i) | | | 17,137,252 | 210,255 |
| Freddie Mac, 0.279%, 9/25/2027 (i) | | | 30,183,000 | 290,345 |
| Freddie Mac, 0.195%, 11/25/2027 (i) | | | 47,333,000 | 344,310 |
| Freddie Mac, 0.322%, 11/25/2027 (i) | | | 29,176,928 | 296,184 |
| Freddie Mac, 0.246%, 12/25/2027 (i) | | | 29,308,000 | 262,688 |
| Freddie Mac, 0.29%, 12/25/2027 (i) | | | 32,765,000 | 345,894 |
| Freddie Mac, 0.364%, 12/25/2027 (i) | | | 50,126,281 | 602,373 |
| Freddie Mac, 1.09%, 7/25/2029 (i) | | | 851,558 | 40,134 |
| Freddie Mac, 1.141%, 8/25/2029 (i) | | | 13,271,667 | 659,947 |
| Freddie Mac, 1.799%, 4/25/2030 (i) | | | 2,500,000 | 229,201 |
| Freddie Mac, 1.868%, 4/25/2030 (i) | | | 7,819,828 | 734,050 |
| Freddie Mac, 1.666%, 5/25/2030 (i) | | | 4,048,749 | 350,665 |
| Freddie Mac, 1.797%, 5/25/2030 (i) | | | 8,995,049 | 827,715 |
| Freddie Mac, 1.341%, 6/25/2030 (i) | | | 3,687,431 | 256,945 |
| Freddie Mac, 1.599%, 8/25/2030 (i) | | | 3,331,192 | 282,030 |
| Freddie Mac, 1.169%, 9/25/2030 (i) | | | 2,196,896 | 138,722 |
| Freddie Mac, 1.08%, 11/25/2030 (i) | | | 4,320,889 | 258,253 |
| Freddie Mac, 0.326%, 1/25/2031 (i) | | | 17,065,772 | 290,222 |
| Freddie Mac, 0.78%, 1/25/2031 (i) | | | 6,541,106 | 293,666 |
| Freddie Mac, 0.936%, 1/25/2031 (i) | | | 4,767,487 | 251,640 |
| Freddie Mac, 0.514%, 3/25/2031 (i) | | | 13,818,326 | 387,326 |
| Freddie Mac, 0.732%, 3/25/2031 (i) | | | 5,934,811 | 255,771 |
| Freddie Mac, 1.216%, 5/25/2031 (i) | | | 2,518,959 | 178,720 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Bonds – continued |
| Mortgage-Backed – continued | |
| Freddie Mac, 0.937%, 7/25/2031 (i) | | $ | 4,010,843 | $231,580 |
| Freddie Mac, 0.508%, 8/25/2031 (i) | | | 5,124,835 | 156,170 |
| Freddie Mac, 0.536%, 9/25/2031 (i) | | | 16,898,337 | 552,998 |
| Freddie Mac, 0.855%, 9/25/2031 (i) | | | 5,075,984 | 259,329 |
| Freddie Mac, 0.349%, 11/25/2031 (i) | | | 25,136,487 | 564,530 |
| Freddie Mac, 0.498%, 12/25/2031 (i) | | | 23,600,379 | 730,717 |
| Freddie Mac, 0.294%, 11/25/2032 (i) | | | 24,130,226 | 433,430 |
| Freddie Mac, 3%, 2/15/2033 (i) | | | 675,255 | 39,857 |
| Freddie Mac, 6%, 3/01/2033 - 6/01/2037 | | | 1,221,052 | 1,260,402 |
| Freddie Mac, 5%, 9/01/2033 - 7/01/2041 | | | 1,936,919 | 1,943,270 |
| Freddie Mac, 5.5%, 12/01/2033 - 10/01/2035 | | | 1,169,471 | 1,194,072 |
| Freddie Mac, 6.5%, 5/01/2034 - 7/01/2037 | | | 440,023 | 455,677 |
| Freddie Mac, 5.5%, 2/15/2036 (i) | | | 131,375 | 23,058 |
| Freddie Mac, 4%, 8/01/2037 - 4/01/2044 | | | 4,688,891 | 4,452,238 |
| Freddie Mac, 3%, 1/01/2038 - 2/25/2059 | | | 20,956,321 | 18,660,043 |
| Freddie Mac, 4.5%, 12/15/2040 (i) | | | 71,901 | 6,259 |
| Freddie Mac, 4%, 8/15/2044 (i) | | | 134,781 | 13,723 |
| Freddie Mac, 3.25%, 11/25/2061 | | | 1,941,622 | 1,667,244 |
| Freddie Mac, UMBS, 6.5%, 5/01/2028 - 8/01/2053 | | | 614,868 | 627,412 |
| Freddie Mac, UMBS, 5%, 7/01/2035 - 9/01/2053 | | | 8,402,216 | 8,208,750 |
| Freddie Mac, UMBS, 6%, 1/01/2036 - 3/01/2036 | | | 104,365 | 106,517 |
| Freddie Mac, UMBS, 2%, 10/01/2036 - 3/01/2052 | | | 88,818,903 | 70,868,370 |
| Freddie Mac, UMBS, 2.5%, 3/01/2037 - 10/01/2052 | | | 67,694,664 | 56,194,720 |
| Freddie Mac, UMBS, 3%, 10/01/2037 - 7/01/2053 | | | 21,697,547 | 18,706,047 |
| Freddie Mac, UMBS, 4.5%, 5/01/2038 - 1/01/2053 | | | 18,649,157 | 17,916,404 |
| Freddie Mac, UMBS, 3.5%, 12/01/2046 - 1/01/2054 | | | 10,418,873 | 9,390,692 |
| Freddie Mac, UMBS, 4%, 8/01/2047 - 5/01/2052 | | | 9,698,308 | 9,080,472 |
| Freddie Mac, UMBS, 1.5%, 3/01/2051 - 10/01/2051 | | | 2,458,100 | 1,858,079 |
| Freddie Mac, UMBS, 5.5%, 12/01/2052 - 10/01/2053 | | | 23,224,017 | 23,144,134 |
| Ginnie Mae, 6%, 9/15/2032 - 8/20/2053 | | | 1,130,598 | 1,172,272 |
| Ginnie Mae, 5.5%, 12/15/2032 - 8/20/2053 | | | 25,070,704 | 25,074,734 |
| Ginnie Mae, 4.5%, 7/15/2033 - 12/20/2052 | | | 38,262,888 | 36,844,498 |
| Ginnie Mae, 5%, 7/20/2033 - 5/20/2053 | | | 34,016,829 | 33,438,200 |
| Ginnie Mae, 4%, 1/20/2041 - 10/20/2052 | | | 15,459,323 | 14,526,720 |
| Ginnie Mae, 5.543%, 9/20/2041 | | | 3,296,299 | 3,235,676 |
| Ginnie Mae, 3.5%, 12/15/2041 - 1/20/2053 | | | 28,422,389 | 25,972,780 |
| Ginnie Mae, 3%, 4/20/2045 - 10/20/2052 | | | 28,140,766 | 24,977,885 |
| Ginnie Mae, 2.5%, 7/20/2051 - 6/20/2052 | | | 23,614,271 | 20,124,320 |
| Ginnie Mae, 2%, 1/20/2052 - 9/20/2052 | | | 17,081,466 | 13,999,532 |
| Ginnie Mae, 0.584%, 2/16/2059 (i) | | | 6,644,152 | 228,224 |
| Ginnie Mae, 6.474%, 3/20/2064 | | | 2,725,000 | 2,725,000 |
| Ginnie Mae , 7%, 3/20/2054 | | | 975,000 | 998,221 |
| Ginnie Mae, TBA, 2%, 4/18/2054 - 5/15/2054 | | | 24,875,000 | 20,393,103 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Bonds – continued |
| Mortgage-Backed – continued | |
| Ginnie Mae, TBA, 6.5%, 5/01/2054 | | $ | 4,700,000 | $4,773,771 |
| Ginnie Mae, TBA, 6%, 5/15/2054 | | | 6,250,000 | 6,299,499 |
| Ginnie Mae, TBA, 2.5%, 5/20/2054 | | | 13,225,000 | 11,274,511 |
| Ginnie Mae, TBA, 3%, 5/20/2054 | | | 6,875,000 | 6,067,834 |
| UMBS, TBA, 3%, 4/25/2039 | | | 1,750,000 | 1,628,632 |
| UMBS, TBA, 5%, 5/01/2039 | | | 2,800,000 | 2,795,262 |
| UMBS, TBA, 2.5%, 4/11/2054 - 5/15/2054 | | | 15,275,000 | 12,634,599 |
| UMBS, TBA, 3.5%, 4/11/2054 - 5/25/2054 | | | 7,550,000 | 6,758,730 |
| UMBS, TBA, 4%, 4/11/2054 | | | 15,875,000 | 14,700,276 |
| UMBS, TBA, 2%, 4/25/2054 - 5/13/2054 | | | 900,000 | 712,662 |
| | | | | $969,361,468 |
| Municipals – 0.2% |
| New Jersey Turnpike Authority Rev., Taxable (Build America Bonds), “F”, 7.414%, 1/01/2040 | | $ | 5,815,000 | $6,934,642 |
| Rhode Island Student Loan Authority Education Loan Rev., Taxable, 6.081%, 12/01/2042 | | | 9,655,000 | 9,675,728 |
| State of Florida, Taxable, “A”, 2.154%, 7/01/2030 | | | 3,243,000 | 2,770,137 |
| | | | | $19,380,507 |
| Natural Gas - Distribution – 0.1% |
| NiSource, Inc., 2.95%, 9/01/2029 | | $ | 3,979,000 | $3,593,548 |
| NiSource, Inc., 5.65%, 2/01/2045 | | | 1,946,000 | 1,927,852 |
| | | | | $5,521,400 |
| Natural Gas - Pipeline – 0.0% |
| APA Infrastructure Ltd., 4.25%, 7/15/2027 (n) | | $ | 777,000 | $760,976 |
| Network & Telecom – 0.1% |
| Verizon Communications, Inc., 3.15%, 3/22/2030 | | $ | 3,413,000 | $3,085,785 |
| Verizon Communications, Inc., 2.55%, 3/21/2031 | | | 2,821,000 | 2,410,040 |
| Verizon Communications, Inc., 4.812%, 3/15/2039 | | | 6,030,000 | 5,693,561 |
| | | | | $11,189,386 |
| Oils – 0.2% |
| Marathon Petroleum Corp., 4.75%, 9/15/2044 | | $ | 2,845,000 | $2,531,403 |
| Phillips 66 Co., 2.15%, 12/15/2030 | | | 9,976,000 | 8,368,878 |
| Valero Energy Corp., 6.625%, 6/15/2037 | | | 6,797,000 | 7,409,672 |
| | | | | $18,309,953 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Bonds – continued |
| Other Banks & Diversified Financials – 0.3% |
| Macquarie Group Ltd., 4.442% to 6/21/2032, FLR (SOFR - 1 day + 2.405%) to 6/21/2033 (n) | | $ | 19,423,000 | $18,032,001 |
| Northern Trust Corp., 6.125%, 11/02/2032 | | | 9,142,000 | 9,656,921 |
| | | | | $27,688,922 |
| Pollution Control – 0.3% |
| Republic Services, Inc., 1.45%, 2/15/2031 | | $ | 2,765,000 | $2,201,570 |
| Waste Management, Inc., 4.875%, 2/15/2034 | | | 20,620,000 | 20,478,936 |
| | | | | $22,680,506 |
| Real Estate - Office – 0.0% |
| Boston Properties LP, REIT, 2.55%, 4/01/2032 | | $ | 4,222,000 | $3,339,834 |
| Real Estate - Other – 0.2% |
| Public Storage Operating, REIT, 5.1%, 8/01/2033 | | $ | 15,515,000 | $15,582,320 |
| Real Estate - Retail – 0.1% |
| Brixmor Operating Partnership LP, REIT, 4.125%, 5/15/2029 | | $ | 567,000 | $534,407 |
| Brixmor Operating Partnership LP, REIT, 4.05%, 7/01/2030 | | | 5,371,000 | 4,981,701 |
| Realty Income Corp., REIT, 3.25%, 1/15/2031 | | | 1,594,000 | 1,421,983 |
| | | | | $6,938,091 |
| Retailers – 0.1% |
| Alimentation Couche-Tard, Inc., 3.439%, 5/13/2041 (n) | | $ | 6,827,000 | $5,243,119 |
| Specialty Stores – 0.1% |
| Genuine Parts Co., 2.75%, 2/01/2032 | | $ | 12,549,000 | $10,434,589 |
| Telecommunications - Wireless – 0.5% |
| Crown Castle, Inc., REIT, 3.65%, 9/01/2027 | | $ | 7,941,000 | $7,527,554 |
| Rogers Communications, Inc., 3.8%, 3/15/2032 | | | 17,162,000 | 15,423,459 |
| T-Mobile USA, Inc., 2.05%, 2/15/2028 | | | 6,192,000 | 5,548,084 |
| T-Mobile USA, Inc., 4.5%, 4/15/2050 | | | 7,223,000 | 6,260,889 |
| Vodafone Group PLC, 5.625%, 2/10/2053 | | | 2,616,000 | 2,599,879 |
| | | | | $37,359,865 |
| Tobacco – 0.4% |
| B.A.T. International Finance PLC, 4.448%, 3/16/2028 | | $ | 17,004,000 | $16,511,704 |
| Philip Morris International, Inc., 5.125%, 11/17/2027 | | | 3,015,000 | 3,030,593 |
| Philip Morris International, Inc., 5.625%, 11/17/2029 | | | 1,299,000 | 1,337,801 |
| Philip Morris International, Inc., 5.125%, 2/15/2030 | | | 4,902,000 | 4,901,947 |
| Philip Morris International, Inc., 5.75%, 11/17/2032 | | | 5,756,000 | 5,942,593 |
| | | | | $31,724,638 |
| Transportation - Services – 0.0% |
| ERAC USA Finance LLC, 7%, 10/15/2037 (n) | | $ | 2,711,000 | $3,091,559 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Bonds – continued |
| U.S. Government Agencies and Equivalents – 0.0% |
| Small Business Administration, 4.77%, 4/01/2024 | | $ | 15,697 | $15,694 |
| Small Business Administration, 5.18%, 5/01/2024 | | | 20,149 | 20,121 |
| Small Business Administration, 5.52%, 6/01/2024 | | | 8,694 | 8,684 |
| Small Business Administration, 4.99%, 9/01/2024 | | | 19,320 | 19,177 |
| Small Business Administration, 4.95%, 3/01/2025 | | | 39,788 | 39,649 |
| | | | | $103,325 |
| U.S. Treasury Obligations – 7.4% |
| U.S. Treasury Bonds, 3.5%, 2/15/2039 | | $ | 5,140,000 | $4,722,174 |
| U.S. Treasury Bonds, 2.375%, 2/15/2042 | | | 9,700,000 | 7,214,754 |
| U.S. Treasury Bonds, 4%, 11/15/2042 | | | 28,650,000 | 26,986,957 |
| U.S. Treasury Bonds, 2.875%, 5/15/2043 | | | 36,361,000 | 28,891,371 |
| U.S. Treasury Bonds, 4.375%, 8/15/2043 | | | 7,100,000 | 7,015,688 |
| U.S. Treasury Bonds, 4.75%, 11/15/2043 | | | 11,250,000 | 11,670,117 |
| U.S. Treasury Bonds, 3%, 11/15/2045 | | | 215,000 | 170,765 |
| U.S. Treasury Bonds, 2.875%, 11/15/2046 | | | 14,148,000 | 10,902,250 |
| U.S. Treasury Bonds, 2.375%, 11/15/2049 | | | 151,800,000 | 103,977,071 |
| U.S. Treasury Bonds, 1.875%, 11/15/2051 | | | 9,015,000 | 5,399,492 |
| U.S. Treasury Bonds, 2.25%, 2/15/2052 | | | 44,658,400 | 29,375,109 |
| U.S. Treasury Bonds, 4%, 11/15/2052 | | | 7,700,000 | 7,239,504 |
| U.S. Treasury Notes, 5%, 8/31/2025 | | | 23,600,000 | 23,647,938 |
| U.S. Treasury Notes, 0.375%, 11/30/2025 (f) | | | 200,700,000 | 186,721,558 |
| U.S. Treasury Notes, 4%, 1/15/2027 | | | 91,300,000 | 90,208,680 |
| U.S. Treasury Notes, 2.75%, 4/30/2027 | | | 13,267,600 | 12,634,279 |
| U.S. Treasury Notes, 4.125%, 7/31/2028 | | | 30,000,000 | 29,812,500 |
| | | | | $586,590,207 |
| Utilities - Electric Power – 0.9% |
| American Electric Power Co., Inc., 5.95%, 11/01/2032 | | $ | 4,413,000 | $4,587,121 |
| American Transmission Systems, Inc., 2.65%, 1/15/2032 (n) | | | 1,738,000 | 1,438,827 |
| Duke Energy Carolinas LLC, 4.95%, 1/15/2033 | | | 13,849,000 | 13,772,650 |
| Duke Energy Corp., 2.65%, 9/01/2026 | | | 1,236,000 | 1,167,083 |
| Duke Energy Corp., 4.5%, 8/15/2032 | | | 10,428,000 | 9,885,279 |
| Duke Energy Progress LLC, 3.45%, 3/15/2029 | | | 5,584,000 | 5,253,334 |
| Enel Finance International N.V., 6.8%, 10/14/2025 (n) | | | 2,896,000 | 2,953,851 |
| Enel Finance International N.V., 4.75%, 5/25/2047 (n) | | | 2,194,000 | 1,876,681 |
| Exelon Corp., 4.05%, 4/15/2030 | | | 5,246,000 | 4,947,402 |
| Georgia Power Co., 3.7%, 1/30/2050 | | | 482,000 | 369,433 |
| Jersey Central Power & Light Co., 4.3%, 1/15/2026 (n) | | | 4,141,000 | 4,046,028 |
| Jersey Central Power & Light Co., 2.75%, 3/01/2032 (n) | | | 2,958,000 | 2,457,832 |
| Oncor Electric Delivery Co. LLC, 5.75%, 3/15/2029 | | | 3,548,000 | 3,668,639 |
| Pacific Gas & Electric Co., 2.1%, 8/01/2027 | | | 1,561,000 | 1,405,474 |
| Pacific Gas & Electric Co., 3%, 6/15/2028 | | | 4,502,000 | 4,112,130 |
| Pacific Gas & Electric Co., 2.5%, 2/01/2031 | | | 6,796,000 | 5,651,408 |
Portfolio of Investments (unaudited) – continued
| Issuer | | | Shares/Par | Value ($) |
| Bonds – continued |
| Utilities - Electric Power – continued |
| Pacific Gas & Electric Co., 3.3%, 8/01/2040 | | $ | 3,004,000 | $2,199,319 |
| Xcel Energy, Inc., 3.4%, 6/01/2030 | | | 3,122,000 | 2,789,672 |
| | | | | $72,582,163 |
| Utilities - Gas – 0.0% |
| East Ohio Gas Co., 2%, 6/15/2030 (n) | | $ | 3,679,000 | $3,021,463 |
| Total Bonds (Identified Cost, $3,228,141,921) | | $2,976,582,178 |
| Preferred Stocks – 0.8% |
| Computer Software - Systems – 0.3% | | | | |
| Samsung Electronics Co. Ltd. | | 407,696 | $20,593,001 |
| Consumer Products – 0.5% | | | | |
| Henkel AG & Co. KGaA | | 498,492 | $40,065,959 |
| Total Preferred Stocks (Identified Cost, $57,380,432) | | $60,658,960 |
| Investment Companies (h) – 1.8% |
| Money Market Funds – 1.8% | |
| MFS Institutional Money Market Portfolio, 5.38% (v) (Identified Cost, $145,717,348) | | | 145,717,624 | $145,746,768 |
|
|
| Other Assets, Less Liabilities – (0.7)% | | (52,526,462) |
| Net Assets – 100.0% | $7,955,599,858 |
| (a) | Non-income producing security. |
| (d) | In default. |
| (f) | All or a portion of the security has been segregated as collateral for open futures contracts. |
| (h) | An affiliated issuer, which may be considered one in which the fund owns 5% or more of the outstanding voting securities, or a company which is under common control. At period end, the aggregate values of the fund's investments in affiliated issuers and in unaffiliated issuers were $145,746,768 and $7,862,379,552, respectively. |
| (i) | Interest only security for which the fund receives interest on notional principal (Par amount). Par amount shown is the notional principal and does not reflect the cost of the security. |
| (n) | Securities exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be sold in the ordinary course of business in transactions exempt from registration, normally to qualified institutional buyers. At period end, the aggregate value of these securities was $539,644,174, representing 6.8% of net assets. |
| (q) | Interest received was less than stated coupon rate. |
| (v) | Affiliated issuer that is available only to investment companies managed by MFS. The rate quoted for the MFS Institutional Money Market Portfolio is the annualized seven-day yield of the fund at period end. |
Portfolio of Investments (unaudited) – continued
| (z) | Restricted securities are not registered under the Securities Act of 1933 and are subject to legal restrictions on resale. These securities generally may be resold in transactions exempt from registration or to the public if the securities are subsequently registered. Disposal of these securities may involve time-consuming negotiations and prompt sale at an acceptable price may be difficult. The fund holds the following restricted securities: |
| Restricted Securities | Acquisition
Date | Cost | Value |
| ReadyCap Commercial Mortgage Trust, 2021-FL5, “A”, FLR, 6.443% ((SOFR - 1mo. + 0.11448%) + 1%), 4/25/2038 | 3/19/21 | $1,951,447 | $1,945,743 |
| ReadyCap Commercial Mortgage Trust, 2021-FL7, “B”, FLR, 7.243% ((SOFR - 1mo. + 0.11448%) + 1.8%), 11/25/2036 | 11/12/21 | 3,695,000 | 3,610,872 |
| Total Restricted Securities | | | $5,556,615 |
| % of Net assets | | | 0.1% |
| The following abbreviations are used in this report and are defined: |
| ADR | American Depositary Receipt |
| CLO | Collateralized Loan Obligation |
| CMT | Constant Maturity Treasury |
| FGIC | Financial Guaranty Insurance Co. |
| FLR | Floating Rate. Interest rate resets periodically based on the parenthetically disclosed reference rate plus a spread (if any). The period-end rate reported may not be the current rate. All reference rates are USD unless otherwise noted. |
| REIT | Real Estate Investment Trust |
| SOFR | Secured Overnight Financing Rate |
| TBA | To Be Announced |
| UMBS | Uniform Mortgage-Backed Security |
Derivative Contracts at 3/31/24
| Futures Contracts |
| Description | Long/
Short | Currency | Contracts | Notional
Amount | Expiration
Date | Value/Unrealized
Appreciation
(Depreciation) |
| Asset Derivatives |
| Interest Rate Futures | | |
| U.S. Treasury Note 5 yr | Long | USD | 1,549 | $165,767,203 | June – 2024 | $419,215 |
| U.S. Treasury Ultra Bond 30 yr | Long | USD | 589 | 75,981,000 | June – 2024 | 1,088,303 |
| | | | | | | $1,507,518 |
| Liability Derivatives |
| Interest Rate Futures | | |
| U.S. Treasury Note 2 yr | Long | USD | 744 | $152,136,376 | June – 2024 | $(75,098) |
| U.S. Treasury Ultra Note 10 yr | Short | USD | 728 | 83,435,625 | June – 2024 | (725,357) |
| | | | | | | $(800,455) |
At March 31, 2024, the fund had liquid securities with an aggregate value of $5,487,204 to cover any collateral or margin obligations for certain derivative contracts.
See Notes to Financial Statements
Financial Statements
Statement of Assets and Liabilities
At 3/31/24 (unaudited)
This statement represents your fund’s balance sheet, which details the assets and liabilities comprising the total value of the fund.
| Assets | |
| Investments in unaffiliated issuers, at value (identified cost, $6,024,415,332) | $7,862,379,552 |
| Investments in affiliated issuers, at value (identified cost, $145,717,348) | 145,746,768 |
| Cash | 13,637,156 |
| Receivables for | |
| Investments sold | 1,626,501 |
| TBA sale commitments | 66,254,653 |
| Fund shares sold | 9,885,007 |
| Interest and dividends | 27,415,199 |
| Other assets | 44,286 |
| Total assets | $8,126,989,122 |
| Liabilities | |
| Payables for | |
| Distributions | $938,306 |
| Net daily variation margin on open futures contracts | 67,927 |
| Investments purchased | 3,960,887 |
| TBA purchase commitments | 154,174,967 |
| Fund shares reacquired | 9,733,420 |
| Payable to affiliates | |
| Investment adviser | 376,869 |
| Administrative services fee | 8,421 |
| Shareholder servicing costs | 1,676,423 |
| Distribution and service fees | 222,602 |
| Payable for independent Trustees' compensation | 21,531 |
| Accrued expenses and other liabilities | 207,911 |
| Total liabilities | $171,389,264 |
| Net assets | $7,955,599,858 |
| Net assets consist of | |
| Paid-in capital | $6,085,012,863 |
| Total distributable earnings (loss) | 1,870,586,995 |
| Net assets | $7,955,599,858 |
| Shares of beneficial interest outstanding | 400,834,124 |
Statement of Assets and Liabilities (unaudited) – continued
| | Net assets | Shares
outstanding | Net asset value
per share (a) |
| Class A | $5,104,999,732 | 257,313,981 | $19.84 |
| Class B | 27,789,607 | 1,395,419 | 19.91 |
| Class C | 257,876,224 | 12,863,769 | 20.05 |
| Class I | 981,531,922 | 49,490,085 | 19.83 |
| Class R1 | 6,742,499 | 340,302 | 19.81 |
| Class R2 | 80,177,849 | 4,022,087 | 19.93 |
| Class R3 | 225,188,525 | 11,337,594 | 19.86 |
| Class R4 | 146,743,513 | 7,385,853 | 19.87 |
| Class R6 | 1,124,549,987 | 56,685,034 | 19.84 |
| (a) | Maximum offering price per share was equal to the net asset value per share for all share classes, except for Class A, for which the maximum offering price per share was $21.05 [100 / 94.25 x $19.84]. On sales of $50,000 or more, the maximum offering price of Class A shares is reduced. A contingent deferred sales charge may be imposed on redemptions of Class A, Class B, and Class C shares. Redemption price per share was equal to the net asset value per share for Classes I, R1, R2, R3, R4, and R6. |
See Notes to Financial Statements
Financial Statements
Statement of Operations
Six months ended 3/31/24 (unaudited)
This statement describes how much your fund earned in investment income and accrued in expenses. It also describes any gains and/or losses generated by fund operations.
| Net investment income (loss) | |
| Income | |
| Interest | $62,244,947 |
| Dividends | 52,484,032 |
| Dividends from affiliated issuers | 2,474,018 |
| Other | 33,563 |
| Income on securities loaned | 17,433 |
| Foreign taxes withheld | (585,178) |
| Total investment income | $116,668,815 |
| Expenses | |
| Management fee | $13,282,955 |
| Distribution and service fees | 8,030,590 |
| Shareholder servicing costs | 3,353,471 |
| Administrative services fee | 307,221 |
| Independent Trustees' compensation | 63,624 |
| Custodian fee | 144,285 |
| Shareholder communications | 125,978 |
| Audit and tax fees | 45,480 |
| Legal fees | 20,498 |
| Miscellaneous | 197,116 |
| Total expenses | $25,571,218 |
| Fees paid indirectly | (3,321) |
| Reduction of expenses by distributor | (11,928) |
| Net expenses | $25,555,969 |
| Net investment income (loss) | $91,112,846 |
Statement of Operations (unaudited) – continued
| Realized and unrealized gain (loss) |
| Realized gain (loss) (identified cost basis) | |
| Unaffiliated issuers | $95,990,990 |
| Affiliated issuers | (1,012) |
| Futures contracts | 302,532 |
| Foreign currency | 12,064 |
| Net realized gain (loss) | $96,304,574 |
| Change in unrealized appreciation or depreciation | |
| Unaffiliated issuers | $801,266,230 |
| Affiliated issuers | 13,096 |
| Futures contracts | 4,421,850 |
| Translation of assets and liabilities in foreign currencies | 32,744 |
| Net unrealized gain (loss) | $805,733,920 |
| Net realized and unrealized gain (loss) | $902,038,494 |
| Change in net assets from operations | $993,151,340 |
See Notes to Financial Statements
Financial Statements
Statements of Changes in Net Assets
These statements describe the increases and/or decreases in net assets resulting from operations, any distributions, and any shareholder transactions.
| | Six months ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 |
| Change in net assets | | |
| From operations | | |
| Net investment income (loss) | $91,112,846 | $169,824,052 |
| Net realized gain (loss) | 96,304,574 | 315,553,914 |
| Net unrealized gain (loss) | 805,733,920 | 189,555,604 |
| Change in net assets from operations | $993,151,340 | $674,933,570 |
| Total distributions to shareholders | $(392,005,729) | $(446,866,652) |
| Change in net assets from fund share transactions | $(51,903,218) | $44,833,930 |
| Total change in net assets | $549,242,393 | $272,900,848 |
| Net assets | | |
| At beginning of period | 7,406,357,465 | 7,133,456,617 |
| At end of period | $7,955,599,858 | $7,406,357,465 |
See Notes to Financial Statements
Financial Statements
Financial Highlights
The financial highlights table is intended to help you understand the fund's financial performance for the semiannual period and the past 5 fiscal years. Certain information reflects financial results for a single fund share. The total returns in the table represent the rate that an investor would have earned (or lost) on an investment in the fund share class (assuming reinvestment of all distributions) held for the entire period.
| Class A | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $18.34 | $17.77 | $22.04 | $19.78 | $19.42 | $19.09 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.22 | $0.41 | $0.31 | $0.28 | $0.36 | $0.41 |
| Net realized and unrealized gain (loss) | 2.26 | 1.27 | (2.83) | 3.36 | 0.63 | 0.78 |
| Total from investment operations | $2.48 | $1.68 | $(2.52) | $3.64 | $0.99 | $1.19 |
| Less distributions declared to shareholders |
| From net investment income | $(0.25) | $(0.46) | $(0.26) | $(0.33) | $(0.37) | $(0.39) |
| From net realized gain | (0.73) | (0.65) | (1.49) | (1.05) | (0.26) | (0.47) |
| Total distributions declared to shareholders | $(0.98) | $(1.11) | $(1.75) | $(1.38) | $(0.63) | $(0.86) |
| Net asset value, end of period (x) | $19.84 | $18.34 | $17.77 | $22.04 | $19.78 | $19.42 |
| Total return (%) (r)(s)(t)(x) | 13.83(n) | 9.43 | (12.61) | 19.02 | 5.21 | 6.73 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 0.72(a) | 0.72 | 0.72 | 0.72 | 0.73 | 0.73 |
| Expenses after expense reductions (f) | 0.72(a) | 0.72 | 0.72 | 0.72 | 0.72 | 0.72 |
| Net investment income (loss) | 2.34(a) | 2.18 | 1.52 | 1.32 | 1.87 | 2.20 |
| Portfolio turnover | 19(n) | 43 | 88 | 112 | 92 | 39 |
| Net assets at end of period (000 omitted) | $5,105,000 | $4,667,098 | $4,462,807 | $5,207,735 | $4,476,559 | $4,666,095 |
See Notes to Financial Statements
Financial Highlights – continued
| Class B | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $18.40 | $17.83 | $22.10 | $19.82 | $19.45 | $19.12 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.15 | $0.27 | $0.15 | $0.12 | $0.22 | $0.27 |
| Net realized and unrealized gain (loss) | 2.27 | 1.26 | (2.82) | 3.38 | 0.63 | 0.77 |
| Total from investment operations | $2.42 | $1.53 | $(2.67) | $3.50 | $0.85 | $1.04 |
| Less distributions declared to shareholders |
| From net investment income | $(0.18) | $(0.31) | $(0.11) | $(0.17) | $(0.22) | $(0.24) |
| From net realized gain | (0.73) | (0.65) | (1.49) | (1.05) | (0.26) | (0.47) |
| Total distributions declared to shareholders | $(0.91) | $(0.96) | $(1.60) | $(1.22) | $(0.48) | $(0.71) |
| Net asset value, end of period (x) | $19.91 | $18.40 | $17.83 | $22.10 | $19.82 | $19.45 |
| Total return (%) (r)(s)(t)(x) | 13.40(n) | 8.55 | (13.25) | 18.16 | 4.44 | 5.90 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 1.47(a) | 1.47 | 1.47 | 1.47 | 1.48 | 1.48 |
| Expenses after expense reductions (f) | N/A | 1.47 | 1.47 | 1.47 | 1.48 | 1.47 |
| Net investment income (loss) | 1.58(a) | 1.41 | 0.73 | 0.57 | 1.12 | 1.44 |
| Portfolio turnover | 19(n) | 43 | 88 | 112 | 92 | 39 |
| Net assets at end of period (000 omitted) | $27,790 | $33,156 | $48,449 | $80,923 | $94,906 | $124,982 |
See Notes to Financial Statements
Financial Highlights – continued
| Class C | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $18.52 | $17.94 | $22.23 | $19.92 | $19.55 | $19.21 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.15 | $0.27 | $0.16 | $0.12 | $0.22 | $0.27 |
| Net realized and unrealized gain (loss) | 2.29 | 1.28 | (2.85) | 3.41 | 0.63 | 0.78 |
| Total from investment operations | $2.44 | $1.55 | $(2.69) | $3.53 | $0.85 | $1.05 |
| Less distributions declared to shareholders |
| From net investment income | $(0.18) | $(0.32) | $(0.11) | $(0.17) | $(0.22) | $(0.24) |
| From net realized gain | (0.73) | (0.65) | (1.49) | (1.05) | (0.26) | (0.47) |
| Total distributions declared to shareholders | $(0.91) | $(0.97) | $(1.60) | $(1.22) | $(0.48) | $(0.71) |
| Net asset value, end of period (x) | $20.05 | $18.52 | $17.94 | $22.23 | $19.92 | $19.55 |
| Total return (%) (r)(s)(t)(x) | 13.43(n) | 8.56 | (13.26) | 18.22 | 4.41 | 5.92 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 1.47(a) | 1.47 | 1.47 | 1.47 | 1.48 | 1.48 |
| Expenses after expense reductions (f) | 1.47(a) | 1.47 | 1.47 | 1.47 | 1.48 | 1.48 |
| Net investment income (loss) | 1.59(a) | 1.42 | 0.75 | 0.57 | 1.12 | 1.44 |
| Portfolio turnover | 19(n) | 43 | 88 | 112 | 92 | 39 |
| Net assets at end of period (000 omitted) | $257,876 | $269,522 | $325,551 | $450,129 | $482,340 | $602,145 |
See Notes to Financial Statements
Financial Highlights – continued
| Class I | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $18.33 | $17.77 | $22.04 | $19.77 | $19.41 | $19.08 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.25 | $0.46 | $0.36 | $0.34 | $0.41 | $0.45 |
| Net realized and unrealized gain (loss) | 2.25 | 1.26 | (2.83) | 3.37 | 0.63 | 0.78 |
| Total from investment operations | $2.50 | $1.72 | $(2.47) | $3.71 | $1.04 | $1.23 |
| Less distributions declared to shareholders |
| From net investment income | $(0.27) | $(0.51) | $(0.31) | $(0.39) | $(0.42) | $(0.43) |
| From net realized gain | (0.73) | (0.65) | (1.49) | (1.05) | (0.26) | (0.47) |
| Total distributions declared to shareholders | $(1.00) | $(1.16) | $(1.80) | $(1.44) | $(0.68) | $(0.90) |
| Net asset value, end of period (x) | $19.83 | $18.33 | $17.77 | $22.04 | $19.77 | $19.41 |
| Total return (%) (r)(s)(t)(x) | 13.98(n) | 9.64 | (12.39) | 19.38 | 5.47 | 6.99 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 0.47(a) | 0.47 | 0.47 | 0.47 | 0.48 | 0.48 |
| Expenses after expense reductions (f) | N/A | N/A | N/A | N/A | N/A | N/A |
| Net investment income (loss) | 2.59(a) | 2.43 | 1.77 | 1.57 | 2.11 | 2.44 |
| Portfolio turnover | 19(n) | 43 | 88 | 112 | 92 | 39 |
| Net assets at end of period (000 omitted) | $981,532 | $923,970 | $871,532 | $1,008,628 | $848,687 | $663,464 |
See Notes to Financial Statements
Financial Highlights – continued
| Class R1 | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $18.32 | $17.75 | $22.02 | $19.75 | $19.39 | $19.06 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.15 | $0.26 | $0.16 | $0.12 | $0.22 | $0.27 |
| Net realized and unrealized gain (loss) | 2.25 | 1.28 | (2.83) | 3.37 | 0.63 | 0.77 |
| Total from investment operations | $2.40 | $1.54 | $(2.67) | $3.49 | $0.85 | $1.04 |
| Less distributions declared to shareholders |
| From net investment income | $(0.18) | $(0.32) | $(0.11) | $(0.17) | $(0.23) | $(0.24) |
| From net realized gain | (0.73) | (0.65) | (1.49) | (1.05) | (0.26) | (0.47) |
| Total distributions declared to shareholders | $(0.91) | $(0.97) | $(1.60) | $(1.22) | $(0.49) | $(0.71) |
| Net asset value, end of period (x) | $19.81 | $18.32 | $17.75 | $22.02 | $19.75 | $19.39 |
| Total return (%) (r)(s)(t)(x) | 13.37(n) | 8.60 | (13.28) | 18.20 | 4.42 | 5.93 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 1.47(a) | 1.47 | 1.47 | 1.47 | 1.48 | 1.48 |
| Expenses after expense reductions (f) | N/A | N/A | N/A | N/A | N/A | N/A |
| Net investment income (loss) | 1.59(a) | 1.41 | 0.76 | 0.57 | 1.12 | 1.44 |
| Portfolio turnover | 19(n) | 43 | 88 | 112 | 92 | 39 |
| Net assets at end of period (000 omitted) | $6,742 | $6,166 | $8,391 | $10,420 | $9,119 | $10,508 |
See Notes to Financial Statements
Financial Highlights – continued
| Class R2 | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $18.42 | $17.85 | $22.13 | $19.85 | $19.48 | $19.15 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.20 | $0.36 | $0.26 | $0.23 | $0.31 | $0.36 |
| Net realized and unrealized gain (loss) | 2.26 | 1.27 | (2.84) | 3.38 | 0.64 | 0.78 |
| Total from investment operations | $2.46 | $1.63 | $(2.58) | $3.61 | $0.95 | $1.14 |
| Less distributions declared to shareholders |
| From net investment income | $(0.22) | $(0.41) | $(0.21) | $(0.28) | $(0.32) | $(0.34) |
| From net realized gain | (0.73) | (0.65) | (1.49) | (1.05) | (0.26) | (0.47) |
| Total distributions declared to shareholders | $(0.95) | $(1.06) | $(1.70) | $(1.33) | $(0.58) | $(0.81) |
| Net asset value, end of period (x) | $19.93 | $18.42 | $17.85 | $22.13 | $19.85 | $19.48 |
| Total return (%) (r)(s)(t)(x) | 13.68(n) | 9.10 | (12.83) | 18.75 | 4.97 | 6.43 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 0.97(a) | 0.97 | 0.97 | 0.97 | 0.98 | 0.98 |
| Expenses after expense reductions (f) | N/A | N/A | N/A | N/A | N/A | 0.98 |
| Net investment income (loss) | 2.09(a) | 1.92 | 1.26 | 1.07 | 1.62 | 1.94 |
| Portfolio turnover | 19(n) | 43 | 88 | 112 | 92 | 39 |
| Net assets at end of period (000 omitted) | $80,178 | $79,854 | $88,487 | $118,257 | $125,160 | $165,893 |
See Notes to Financial Statements
Financial Highlights – continued
| Class R3 | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $18.36 | $17.79 | $22.06 | $19.79 | $19.43 | $19.10 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.22 | $0.41 | $0.31 | $0.28 | $0.36 | $0.41 |
| Net realized and unrealized gain (loss) | 2.26 | 1.27 | (2.83) | 3.37 | 0.63 | 0.78 |
| Total from investment operations | $2.48 | $1.68 | $(2.52) | $3.65 | $0.99 | $1.19 |
| Less distributions declared to shareholders |
| From net investment income | $(0.25) | $(0.46) | $(0.26) | $(0.33) | $(0.37) | $(0.39) |
| From net realized gain | (0.73) | (0.65) | (1.49) | (1.05) | (0.26) | (0.47) |
| Total distributions declared to shareholders | $(0.98) | $(1.11) | $(1.75) | $(1.38) | $(0.63) | $(0.86) |
| Net asset value, end of period (x) | $19.86 | $18.36 | $17.79 | $22.06 | $19.79 | $19.43 |
| Total return (%) (r)(s)(t)(x) | 13.81(n) | 9.41 | (12.60) | 19.05 | 5.20 | 6.71 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 0.72(a) | 0.72 | 0.72 | 0.72 | 0.73 | 0.73 |
| Expenses after expense reductions (f) | N/A | N/A | N/A | N/A | N/A | N/A |
| Net investment income (loss) | 2.34(a) | 2.17 | 1.51 | 1.32 | 1.86 | 2.19 |
| Portfolio turnover | 19(n) | 43 | 88 | 112 | 92 | 39 |
| Net assets at end of period (000 omitted) | $225,189 | $207,158 | $222,265 | $294,584 | $284,813 | $290,210 |
See Notes to Financial Statements
Financial Highlights – continued
| Class R4 | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $18.36 | $17.80 | $22.07 | $19.80 | $19.44 | $19.11 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.24 | $0.46 | $0.36 | $0.34 | $0.41 | $0.46 |
| Net realized and unrealized gain (loss) | 2.27 | 1.26 | (2.83) | 3.37 | 0.63 | 0.77 |
| Total from investment operations | $2.51 | $1.72 | $(2.47) | $3.71 | $1.04 | $1.23 |
| Less distributions declared to shareholders |
| From net investment income | $(0.27) | $(0.51) | $(0.31) | $(0.39) | $(0.42) | $(0.43) |
| From net realized gain | (0.73) | (0.65) | (1.49) | (1.05) | (0.26) | (0.47) |
| Total distributions declared to shareholders | $(1.00) | $(1.16) | $(1.80) | $(1.44) | $(0.68) | $(0.90) |
| Net asset value, end of period (x) | $19.87 | $18.36 | $17.80 | $22.07 | $19.80 | $19.44 |
| Total return (%) (r)(s)(t)(x) | 14.01(n) | 9.62 | (12.37) | 19.35 | 5.47 | 6.98 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 0.47(a) | 0.47 | 0.47 | 0.47 | 0.48 | 0.48 |
| Expenses after expense reductions (f) | N/A | N/A | N/A | N/A | N/A | N/A |
| Net investment income (loss) | 2.55(a) | 2.43 | 1.77 | 1.57 | 2.11 | 2.45 |
| Portfolio turnover | 19(n) | 43 | 88 | 112 | 92 | 39 |
| Net assets at end of period (000 omitted) | $146,744 | $214,802 | $203,954 | $252,366 | $251,641 | $236,165 |
See Notes to Financial Statements
Financial Highlights – continued
| Class R6 | Six months
ended | Year ended |
| | 3/31/24
(unaudited) | 9/30/23 | 9/30/22 | 9/30/21 | 9/30/20 | 9/30/19 |
| Net asset value, beginning of period | $18.34 | $17.77 | $22.04 | $19.77 | $19.42 | $19.09 |
| Income (loss) from investment operations |
| Net investment income (loss) (d) | $0.25 | $0.47 | $0.38 | $0.35 | $0.42 | $0.47 |
| Net realized and unrealized gain (loss) | 2.26 | 1.27 | (2.83) | 3.37 | 0.63 | 0.78 |
| Total from investment operations | $2.51 | $1.74 | $(2.45) | $3.72 | $1.05 | $1.25 |
| Less distributions declared to shareholders |
| From net investment income | $(0.28) | $(0.52) | $(0.33) | $(0.40) | $(0.44) | $(0.45) |
| From net realized gain | (0.73) | (0.65) | (1.49) | (1.05) | (0.26) | (0.47) |
| Total distributions declared to shareholders | $(1.01) | $(1.17) | $(1.82) | $(1.45) | $(0.70) | $(0.92) |
| Net asset value, end of period (x) | $19.84 | $18.34 | $17.77 | $22.04 | $19.77 | $19.42 |
| Total return (%) (r)(s)(t)(x) | 14.01(n) | 9.78 | (12.32) | 19.47 | 5.50 | 7.07 |
Ratios (%) (to average net assets)
and Supplemental data: |
| Expenses before expense reductions (f) | 0.39(a) | 0.39 | 0.39 | 0.39 | 0.40 | 0.40 |
| Expenses after expense reductions (f) | N/A | N/A | N/A | N/A | N/A | N/A |
| Net investment income (loss) | 2.67(a) | 2.51 | 1.85 | 1.65 | 2.19 | 2.52 |
| Portfolio turnover | 19(n) | 43 | 88 | 112 | 92 | 39 |
| Net assets at end of period (000 omitted) | $1,124,550 | $1,004,631 | $902,020 | $1,023,815 | $895,481 | $753,666 |
| (a) | Annualized. |
| (d) | Per share data is based on average shares outstanding. |
| (f) | Ratios do not reflect reductions from fees paid indirectly, if applicable. See Note 2 in the Notes to Financial Statements for additional information. |
| (n) | Not annualized. |
| (r) | Certain expenses have been reduced without which performance would have been lower. |
| (s) | From time to time the fund may receive proceeds from litigation settlements, without which performance would be lower. |
| (t) | Total returns do not include any applicable sales charges. |
| (x) | The net asset values and total returns have been calculated on net assets which include adjustments made in accordance with U.S. generally accepted accounting principles required at period end for financial reporting purposes. |
See Notes to Financial Statements
Notes to Financial Statements
(unaudited)
(1) Business and Organization
MFS Total Return Fund (the fund) is a diversified series of MFS Series Trust V (the trust). The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company.
The fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services - Investment Companies.
(2) Significant Accounting Policies
General — The preparation of financial statements in conformity with U.S. generally accepted accounting principles 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 increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. In the preparation of these financial statements, management has evaluated subsequent events occurring after the date of the fund’s Statement of Assets and Liabilities through the date that the financial statements were issued.
Balance Sheet Offsetting — The fund's accounting policy with respect to balance sheet offsetting is that, absent an event of default by the counterparty or a termination of the agreement, the International Swaps and Derivatives Association (ISDA) Master Agreement, or similar agreement, does not result in an offset of reported amounts of financial assets and financial liabilities in the Statement of Assets and Liabilities across transactions between the fund and the applicable counterparty. The fund's right to setoff may be restricted or prohibited by the bankruptcy or insolvency laws of the particular jurisdiction to which a specific master netting agreement counterparty is subject. Balance sheet offsetting disclosures, to the extent applicable to the fund, have been included in the fund’s Significant Accounting Policies note under the captions for each of the fund’s in-scope financial instruments and transactions.
Investment Valuations — Subject to its oversight, the fund's Board of Trustees has delegated primary responsibility for determining or causing to be determined the value of the fund’s investments to MFS as the fund's adviser, pursuant to the fund’s valuation policy and procedures which have been adopted by the adviser and approved by the Board. In accordance with Rule 2a-5 under the Investment Company Act of 1940, the Board of Trustees designated the adviser as the “valuation designee” of the fund. If the adviser, as valuation designee, determines that reliable market quotations are not readily available for an investment, the investment is valued at fair value as determined in good faith by the adviser in accordance with the adviser’s fair valuation policy and procedures.
Under the fund's valuation policy and procedures, equity securities, including restricted equity securities, are generally valued at the last sale or official closing price on their primary market or exchange as provided by a third-party pricing service. Equity securities, for which there were no sales reported that day, are generally valued at the last quoted daily bid quotation on their primary market or exchange as provided by a
Notes to Financial Statements (unaudited) - continued
third-party pricing service. Debt instruments and floating rate loans, including restricted debt instruments, are generally valued at an evaluated or composite bid as provided by a third-party pricing service. Short-term instruments with a maturity at issuance of 60 days or less may be valued at amortized cost, which approximates market value.
Futures contracts are generally valued at last posted settlement price on their primary exchange as provided by a third-party pricing service. Futures contracts for which there were no trades that day for a particular position are generally valued at the closing bid quotation on their primary exchange as provided by a third-party pricing service.
Open-end investment companies are generally valued at net asset value per share. The values of foreign securities and other assets and liabilities expressed in foreign currencies are converted to U.S. dollars using the mean of bid and asked prices for rates provided by a third-party pricing service.
Under the fund’s valuation policy and procedures, market quotations are not considered to be readily available for debt instruments, floating rate loans, and many types of derivatives. These investments are generally valued at fair value based on information from third-party pricing services or otherwise determined by the adviser in accordance with the adviser’s fair valuation policy and procedures. Securities and other assets generally valued on the basis of information from a third-party pricing service may also be valued at a broker/dealer bid quotation. In determining values, third-party pricing services can utilize both transaction data and market information such as yield, quality, coupon rate, maturity, type of issue, trading characteristics, spreads and other market data. An investment may also be valued at fair value if the adviser determines that the investment’s value has been materially affected by events occurring after the close of the exchange or market on which the investment is principally traded (such as foreign exchange or market) and prior to the determination of the fund’s net asset value, or after the halt of trading of a specific security where trading does not resume prior to the close of the exchange or market on which the security is principally traded. Events that occur after foreign markets close (such as developments in foreign markets and significant movements in the U.S. markets) and prior to the determination of the fund’s net asset value may be deemed to have a material effect on the value of securities traded in foreign markets. Accordingly, the fund’s foreign equity securities may often be valued at fair value. The adviser generally relies on third-party pricing services or other information (such as the correlation with price movements of similar securities in the same or other markets; the type, cost and investment characteristics of the security; the business and financial condition of the issuer; and trading and other market data) to assist in determining whether to fair value and at what value to fair value an investment. The value of an investment for purposes of calculating the fund’s net asset value can differ depending on the source and method used to determine value. When fair valuation is used, the value of an investment used to determine the fund’s net asset value may differ from quoted or published prices for the same investment. There can be no assurance that the fund could obtain the fair value assigned to an investment if it were to sell the investment at the same time at which the fund determines its net asset value per share.
Various inputs are used in determining the value of the fund's assets or liabilities. These inputs are categorized into three broad levels. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an investment's level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fund's assessment of the significance of a particular input to the fair value measurement in its entirety requires
Notes to Financial Statements (unaudited) - continued
judgment, and considers factors specific to the investment. Level 1 includes unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 includes other significant observable market-based inputs (including quoted prices for similar securities, interest rates, prepayment speed, and credit risk). Level 3 includes significant unobservable inputs, which may include the adviser's own assumptions in determining the fair value of investments. Other financial instruments are derivative instruments, such as futures contracts. The following is a summary of the levels used as of March 31, 2024 in valuing the fund's assets and liabilities:
| Financial Instruments | Level 1 | Level 2 | Level 3 | Total |
| Equity Securities | $4,885,797,374 | $— | $— | $4,885,797,374 |
| U.S. Treasury Bonds & U.S. Government Agencies & Equivalents | — | 586,693,532 | — | 586,693,532 |
| Non - U.S. Sovereign Debt | — | 2,421,474 | — | 2,421,474 |
| Municipal Bonds | — | 19,380,507 | — | 19,380,507 |
| U.S. Corporate Bonds | — | 665,004,323 | — | 665,004,323 |
| Residential Mortgage-Backed Securities | — | 969,530,370 | — | 969,530,370 |
| Commercial Mortgage-Backed Securities | — | 128,958,515 | — | 128,958,515 |
| Asset-Backed Securities (including CDOs) | — | 326,130,994 | — | 326,130,994 |
| Foreign Bonds | — | 278,462,463 | — | 278,462,463 |
| Mutual Funds | 145,746,768 | — | — | 145,746,768 |
| Total | $5,031,544,142 | $2,976,582,178 | $— | $8,008,126,320 |
| Other Financial Instruments | | | | |
| Futures Contracts – Assets | $1,507,518 | $— | $— | $1,507,518 |
| Futures Contracts – Liabilities | (800,455) | — | — | (800,455) |
For further information regarding security characteristics, see the Portfolio of Investments.
Foreign Currency Translation — Purchases and sales of foreign investments, income, and expenses are converted into U.S. dollars based upon currency exchange rates prevailing on the respective dates of such transactions or on the reporting date for foreign denominated receivables and payables. Gains and losses attributable to foreign currency exchange rates on sales of securities are recorded for financial statement purposes as net realized gains and losses on investments. Gains and losses attributable to foreign exchange rate movements on receivables, payables, income and expenses are recorded for financial statement purposes as foreign currency transaction gains and losses. That portion of both realized and unrealized gains and losses on investments that results from fluctuations in foreign currency exchange rates is not separately disclosed.
Derivatives — The fund uses derivatives primarily to increase or decrease exposure to a particular market or segment of the market, or security, to increase or decrease interest rate or currency exposure, or as alternatives to direct investments. Derivatives are used for hedging or non-hedging purposes. While hedging can reduce or eliminate
Notes to Financial Statements (unaudited) - continued
losses, it can also reduce or eliminate gains. When the fund uses derivatives as an investment to increase market exposure, or for hedging purposes, gains and losses from derivative instruments may be substantially greater than the derivative’s original cost.
The derivative instruments used by the fund during the period were futures contracts. Depending on the type of derivative, a fund may exit a derivative position by entering into an offsetting transaction with a counterparty or exchange, negotiating an agreement with the derivative counterparty, or novating the position to a third party. The fund may be unable to promptly close out a futures position in instances where the daily fluctuation in the price for that type of future exceeds the daily limit set by the exchange. The fund's period end derivatives, as presented in the Portfolio of Investments and the associated Derivative Contract tables, generally are indicative of the volume of its derivative activity during the period.
The following table presents, by major type of derivative contract, the fair value, on a gross basis, of the asset and liability components of derivatives held by the fund at March 31, 2024 as reported in the Statement of Assets and Liabilities:
| | | Fair Value (a) |
| Risk | Derivative Contracts | Asset Derivatives | Liability Derivatives |
| Interest Rate | Futures Contracts | $1,507,518 | $(800,455) |
(a) Values presented in this table for futures contracts correspond to the values reported in the Portfolio of Investments. Only the current day net variation margin for futures contracts is reported separately within the Statement of Assets and Liabilities.
The following table presents, by major type of derivative contract, the realized gain (loss) on derivatives held by the fund for the six months ended March 31, 2024 as reported in the Statement of Operations:
| Risk | Futures
Contracts |
| Interest Rate | $302,532 |
The following table presents, by major type of derivative contract, the change in unrealized appreciation or depreciation on derivatives held by the fund for the six months ended March 31, 2024 as reported in the Statement of Operations:
| Risk | Futures
Contracts |
| Interest Rate | $4,421,850 |
Derivative counterparty credit risk is managed through formal evaluation of the creditworthiness of all potential counterparties. On certain, but not all, uncleared derivatives, the fund attempts to reduce its exposure to counterparty credit risk whenever possible by entering into an ISDA Master Agreement on a bilateral basis. The ISDA Master Agreement gives each party to the agreement the right to terminate all transactions traded under such agreement if there is a specified deterioration in the credit quality of the other party. Upon an event of default or a termination of the ISDA Master Agreement, the non-defaulting party has the right to close out all transactions traded under such agreement and to net amounts owed under each agreement to one net amount payable by one party to the other. This right to close out and net payments
Notes to Financial Statements (unaudited) - continued
across all transactions traded under the ISDA Master Agreement could result in a reduction of the fund's credit risk to such counterparty equal to any amounts payable by the fund under the applicable transactions, if any.
Collateral and margin requirements differ by type of derivative. For cleared derivatives (e.g., futures contracts, cleared swaps, and exchange-traded options), margin requirements are set by the clearing broker and the clearing house and collateral, in the form of cash or securities, is posted by the fund directly with the clearing broker. Collateral terms are counterparty agreement specific for uncleared derivatives (e.g., forward foreign currency exchange contracts, uncleared swap agreements, and uncleared options) and collateral, in the form of cash and securities, is held in segregated accounts with the fund's custodian in connection with these agreements. For derivatives traded under an ISDA Master Agreement, which contains a credit support annex, the collateral requirements are netted across all transactions traded under such counterparty-specific agreement and an amount is posted from one party to the other to collateralize such obligations. Cash that has been segregated or delivered to cover the fund's collateral or margin obligations under derivative contracts, if any, will be reported separately in the Statement of Assets and Liabilities as restricted cash for uncleared derivatives and/or deposits with brokers for cleared derivatives. Securities pledged as collateral or margin for the same purpose, if any, are noted in the Portfolio of Investments. The fund may be required to make payments of interest on uncovered collateral or margin obligations with the broker. Any such payments are included in “Miscellaneous” expense in the Statement of Operations.
Futures Contracts — The fund entered into futures contracts which may be used to hedge against or obtain broad market exposure, interest rate exposure, currency exposure, or to manage duration. A futures contract represents a commitment for the future purchase or sale of an asset at a specified price on a specified date.
Upon entering into a futures contract, the fund is required to deposit with the broker, either in cash or securities, an initial margin in an amount equal to a specified percentage of the notional amount of the contract. Subsequent payments (variation margin) are made or received by the fund each day, depending on the daily fluctuations in the value of the contract, and are recorded for financial statement purposes as unrealized gain or loss by the fund until the contract is closed or expires at which point the gain or loss on futures contracts is realized.
The fund bears the risk of interest rates, exchange rates or securities prices moving unexpectedly, in which case, the fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. While futures contracts may present less counterparty risk to the fund since the contracts are exchange traded and the exchange’s clearinghouse guarantees payments to the broker, there is still counterparty credit risk due to the insolvency of the broker. The fund’s maximum risk of loss due to counterparty credit risk is equal to the margin posted by the fund to the broker plus any gains or minus any losses on the outstanding futures contracts.
Mortgage-Backed/Asset-Backed Securities — The fund invests a significant portion of its assets in asset-backed and/or mortgage-backed securities. For these securities, the value of the debt instrument also depends on the credit quality and adequacy of the underlying assets or collateral as well as whether there is a security interest in the underlying assets or collateral. Enforcing rights, if any, against the underlying assets or collateral may be difficult. U.S. Government securities not supported as to the payment
Notes to Financial Statements (unaudited) - continued
of principal or interest by the U.S. Treasury, such as those issued by Fannie Mae, Freddie Mac, and the Federal Home Loan Banks, are subject to greater credit risk than are U.S. Government securities supported by the U.S. Treasury, such as those issued by Ginnie Mae.
Security Loans — Under its Securities Lending Agency Agreement with the fund, JPMorgan Chase and Co., as lending agent, loans the securities of the fund to certain qualified institutions (the “Borrowers”) approved by the fund. Security loans can be terminated at the discretion of either the lending agent or the fund and the related securities must be returned within the earlier of the standard trade settlement period for such securities or within three business days. The loans are collateralized by cash and/or U.S. Treasury and federal agency obligations in an amount typically at least equal to the market value of the securities loaned. On loans collateralized by cash, the cash collateral is invested in a money market fund. The market value of the loaned securities is determined at the close of business of the fund and any additional required collateral is delivered to the fund on the next business day. The lending agent provides the fund with indemnification against Borrower default. In the event of Borrower default, the lending agent will, for the benefit of the fund, either purchase securities identical to those loaned or, when such purchase is commercially impracticable, pay the fund the market value of the loaned securities. In return, the lending agent assumes the fund's rights to the related collateral. If the collateral value is less than the cost to purchase identical securities, the lending agent is responsible for the shortfall, but only to the extent that such shortfall is not due to a decline in collateral value resulting from collateral reinvestment for which the fund bears the risk of loss. A portion of the income generated upon investment of the collateral is remitted to the Borrowers, and the remainder is allocated between the fund and the lending agent. On loans collateralized by U.S. Treasury and/or federal agency obligations, a fee is received from the Borrower, and is allocated between the fund and the lending agent. Income from securities lending is separately reported in the Statement of Operations. The dividend and interest income earned on the securities loaned is accounted for in the same manner as other dividend and interest income. At March 31, 2024, there were no securities on loan or collateral outstanding.
Indemnifications — Under the fund's organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to the fund. Additionally, in the normal course of business, the fund enters into agreements with service providers that may contain indemnification clauses. The fund's maximum exposure under these agreements is unknown as this would involve future claims that may be made against the fund that have not yet occurred.
Investment Transactions and Income — Interest income is recorded on the accrual basis. All premium and discount is amortized or accreted for financial statement purposes in accordance with U.S. generally accepted accounting principles. Dividends received in cash are recorded on the ex-dividend date. Certain dividends from foreign securities will be recorded when the fund is informed of the dividend if such information is obtained subsequent to the ex-dividend date. Dividend and interest payments received in additional securities are recorded on the ex-dividend or ex-interest date in an amount equal to the value of the security on such date.
Notes to Financial Statements (unaudited) - continued
The fund may receive proceeds from litigation settlements. Any proceeds received from litigation involving portfolio holdings are reflected in the Statement of Operations in realized gain/loss if the security has been disposed of by the fund or in unrealized gain/loss if the security is still held by the fund. Any other proceeds from litigation not related to portfolio holdings are reflected as other income in the Statement of Operations.
Investment transactions are recorded on the trade date. In determining the net gain or loss on securities sold, the cost of securities is determined on the identified cost basis.
The fund may purchase or sell mortgage-backed securities on a “To Be Announced” (TBA) basis. A TBA transaction is subject to extended settlement and typically does not designate the actual security to be delivered, but instead includes an approximate principal amount. The price of the TBA security and the date that it will be settled are fixed at the time the transaction is negotiated. The value of the security varies with market fluctuations and no interest accrues to the fund until settlement takes place. TBA purchase and sale commitments are held at carrying amount, which approximates fair value and are categorized as level 2 within the fair value hierarchy and included in TBA purchase and TBA sale commitments in the Statement of Assets and Liabilities, as applicable. Losses may arise as a result of changes in the value of the TBA investment prior to settlement date or due to counterparty non-performance.
The fund may also enter into mortgage dollar rolls, typically TBA dollar rolls, in which the fund sells TBA mortgage-backed securities to financial institutions and simultaneously agrees to repurchase similar (same issuer, type and coupon) securities at a later date at an agreed-upon price. During the period between the sale and repurchase, the fund will not be entitled to receive interest and principal payments on the securities sold. The fund accounts for dollar roll transactions as purchases and sales and realizes gains and losses on these transactions. Dollar roll transactions involve the risk that the market value of the securities that the fund is required to purchase may decline below the agreed upon repurchase price of those securities.
To mitigate the counterparty credit risk on TBA transactions, mortgage dollar rolls, and other types of forward settling mortgage-backed and asset-backed security transactions, the fund whenever possible enters into a Master Securities Forward Transaction Agreement (“MSFTA”) on a bilateral basis with each of the counterparties with whom it undertakes a significant volume of transactions. The MSFTA gives each party to the agreement the right to terminate all transactions traded under such agreement if there is a specified deterioration in the credit quality of the other party. Upon an event of default or a termination of the MSFTA, the non-defaulting party has the right to close out all transactions traded under such agreement and to net amounts owed under each transaction to one net amount payable by one party to the other. This right to close out and net payments across all transactions traded under the MSFTA could result in a reduction of the fund's credit risk to such counterparty equal to any amounts payable by the fund under the applicable transactions, if any.
For mortgage-backed and asset-backed securities traded under a MSFTA, the collateral and margining requirements are contract specific. Collateral amounts across all transactions traded under such agreement are netted and an amount is posted from one party to the other to collateralize such obligations. Cash that has been pledged to
Notes to Financial Statements (unaudited) - continued
cover the fund's collateral or margin obligations under a MSFTA, if any, will be reported separately on the Statement of Assets and Liabilities as restricted cash. Securities pledged as collateral or margin for the same purpose, if any, are noted in the Portfolio of Investments.
Fees Paid Indirectly — The fund's custody fee may be reduced by a credit earned under an arrangement that measures the value of U.S. dollars deposited with the custodian by the fund. The amount of the credit, for the six months ended March 31, 2024, is shown as a reduction of total expenses in the Statement of Operations.
Tax Matters and Distributions — The fund intends to qualify as a regulated investment company, as defined under Subchapter M of the Internal Revenue Code, and to distribute all of its taxable income, including realized capital gains. As a result, no provision for federal income tax is required. The fund’s federal tax returns, when filed, will remain subject to examination by the Internal Revenue Service for a three year period. Management has analyzed the fund’s tax positions taken on federal and state tax returns for all open tax years and does not believe that there are any uncertain tax positions that require recognition of a tax liability. Foreign taxes, if any, have been accrued by the fund in the accompanying financial statements in accordance with the applicable foreign tax law. Foreign income taxes may be withheld by certain countries in which the fund invests. Additionally, capital gains realized by the fund on securities issued in or by certain foreign countries may be subject to capital gains tax imposed by those countries.
Distributions to shareholders are recorded on the ex-dividend date. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from U.S. generally accepted accounting principles. Certain capital accounts in the financial statements are periodically adjusted for permanent differences in order to reflect their tax character. These adjustments have no impact on net assets or net asset value per share. Temporary differences which arise from recognizing certain items of income, expense, gain or loss in different periods for financial statement and tax purposes will reverse at some time in the future.
Book/tax differences primarily relate to amortization of premium and accretion of discount of debt securities, wash sale loss deferrals, derivative transactions, and treating a portion of the proceeds from redemptions as a distribution for tax purposes.
The tax character of distributions made during the current period will be determined at fiscal year end. The tax character of distributions declared to shareholders for the last fiscal year is as follows:
| | Year ended
9/30/23 |
| Ordinary income (including any short-term capital gains) | $190,402,180 |
| Long-term capital gains | 256,464,472 |
| Total distributions | $446,866,652 |
Notes to Financial Statements (unaudited) - continued
The federal tax cost and the tax basis components of distributable earnings were as follows:
| As of 3/31/24 | |
| Cost of investments | $6,219,397,394 |
| Gross appreciation | 2,181,517,317 |
| Gross depreciation | (392,788,391) |
| Net unrealized appreciation (depreciation) | $1,788,728,926 |
| As of 9/30/23 | |
| Undistributed ordinary income | 26,657,136 |
| Undistributed long-term capital gain | 272,242,270 |
| Other temporary differences | (23,743,063) |
| Net unrealized appreciation (depreciation) | 994,285,041 |
The aggregate cost above includes prior fiscal year end tax adjustments, if applicable.
Multiple Classes of Shares of Beneficial Interest — The fund offers multiple classes of shares, which differ in their respective distribution and service fees. The fund's income, realized and unrealized gain (loss), and common expenses are allocated to shareholders based on the daily net assets of each class. Dividends are declared separately for each class. Differences in per share dividend rates are generally due to differences in separate class expenses. Class B and Class C shares will convert to Class A shares approximately eight years after purchase. The fund’s distributions declared to shareholders as reported in the Statements of Changes in Net Assets are presented by class as follows:
| | Six months
ended
3/31/24 | | Year
ended
9/30/23 |
| Class A | $247,532,319 | | $278,298,921 |
| Class B | 1,448,034 | | 2,339,606 |
| Class C | 12,250,676 | | 16,504,687 |
| Class I | 48,895,683 | | 56,544,330 |
| Class R1 | 297,902 | | 431,295 |
| Class R2 | 3,963,065 | | 5,062,784 |
| Class R3 | 11,063,167 | | 13,568,537 |
| Class R4 | 10,952,532 | | 13,259,620 |
| Class R6 | 55,602,351 | | 60,856,872 |
| Total | $392,005,729 | | $446,866,652 |
(3) Transactions with Affiliates
Investment Adviser — The fund has an investment advisory agreement with MFS to provide overall investment management and related administrative services and facilities to the fund. The management fee is computed daily and paid monthly at the following annual rates based on the fund's average daily net assets:
| Up to $6.3 billion | 0.35% |
| In excess of $6.3 billion and up to $10 billion | 0.34% |
| In excess of $10 billion | 0.33% |
Notes to Financial Statements (unaudited) - continued
The management fee incurred for the six months ended March 31, 2024 was equivalent to an annual effective rate of 0.35% of the fund's average daily net assets.
Distributor — MFS Fund Distributors, Inc. (MFD), a wholly-owned subsidiary of MFS, as distributor, received $116,083 for the six months ended March 31, 2024, as its portion of the initial sales charge on sales of Class A shares of the fund.
The Board of Trustees has adopted a distribution plan for certain share classes pursuant to Rule 12b-1 of the Investment Company Act of 1940.
The fund's distribution plan provides that the fund will pay MFD for services provided by MFD and financial intermediaries in connection with the distribution and servicing of certain share classes. One component of the plan is a distribution fee paid to MFD and another component of the plan is a service fee paid to MFD. MFD may subsequently pay all, or a portion, of the distribution and/or service fees to financial intermediaries. The distribution and service fees are computed daily and paid monthly.
Distribution Plan Fee Table:
| | Distribution
Fee Rate (d) | Service
Fee Rate (d) | Total
Distribution
Plan (d) | Annual
Effective
Rate (e) | Distribution
and Service
Fee |
| Class A | — | 0.25% | 0.25% | 0.25% | $ 6,059,933 |
| Class B | 0.75% | 0.25% | 1.00% | 1.00% | 154,263 |
| Class C | 0.75% | 0.25% | 1.00% | 1.00% | 1,313,526 |
| Class R1 | 0.75% | 0.25% | 1.00% | 1.00% | 31,871 |
| Class R2 | 0.25% | 0.25% | 0.50% | 0.50% | 200,210 |
| Class R3 | — | 0.25% | 0.25% | 0.25% | 270,787 |
| Total Distribution and Service Fees | | | | | $8,030,590 |
| (d) | In accordance with the distribution plan for certain classes, the fund pays distribution and/or service fees equal to these annual percentage rates of each class’s average daily net assets. The distribution and service fee rates disclosed by class represent the current rates in effect at the end of the reporting period. Any rate changes, if applicable, are detailed below. |
| (e) | The annual effective rates represent actual fees incurred under the distribution plan for the six months ended March 31, 2024 based on each class's average daily net assets. MFD has voluntarily agreed to rebate a portion of each class's 0.25% service fee attributable to accounts for which there is no financial intermediary specified on the account except for accounts attributable to MFS or its affiliates' seed money. For the six months ended March 31, 2024, this rebate amounted to $11,926 and $2 for Class A and Class C shares, respectively, and is included in the reduction of total expenses in the Statement of Operations. |
Certain Class A shares are subject to a contingent deferred sales charge (CDSC) in the event of a shareholder redemption within 18 months of purchase. Class B shares are subject to a CDSC in the event of a shareholder redemption within six years of purchase. Class C shares are subject to a CDSC in the event of a shareholder redemption within 12 months of purchase. All contingent deferred sales charges are paid to MFD and during the six months ended March 31, 2024, were as follows:
| | Amount |
| Class A | $49,045 |
| Class B | 6,424 |
| Class C | 5,618 |
Notes to Financial Statements (unaudited) - continued
Shareholder Servicing Agent — MFS Service Center, Inc. (MFSC), a wholly-owned subsidiary of MFS, receives a fee from the fund for its services as shareholder servicing agent calculated as a percentage of the average daily net assets of the fund as determined periodically under the supervision of the fund's Board of Trustees. For the six months ended March 31, 2024, the fee was $583,944, which equated to 0.0153% annually of the fund's average daily net assets. MFSC also receives reimbursement from the fund for out-of-pocket expenses, sub-accounting and other shareholder servicing costs which may be paid to affiliated and unaffiliated service providers. Class R6 shares do not incur sub-accounting fees. For the six months ended March 31, 2024, these out-of-pocket expenses, sub-accounting and other shareholder servicing costs amounted to $2,769,527.
Administrator — MFS provides certain financial, legal, shareholder communications, compliance, and other administrative services to the fund. Under an administrative services agreement, the fund reimburses MFS the costs incurred to provide these services. The fund is charged an annual fixed amount of $17,500 plus a fee based on average daily net assets. The administrative services fee is computed daily and paid monthly. The administrative services fee incurred for the six months ended March 31, 2024 was equivalent to an annual effective rate of 0.0081% of the fund's average daily net assets.
Trustees’ and Officers’ Compensation — The fund pays compensation to independent Trustees in the form of a retainer, attendance fees, and additional compensation to Board and Committee chairpersons. Independent Trustees’ compensation is accrued daily and paid subsequent to each Trustee Board meeting. The fund does not pay compensation directly to Trustees or officers of the fund who are also officers of the investment adviser, all of whom receive remuneration from MFS for their services to the fund. Certain officers and Trustees of the fund are officers or directors of MFS, MFD, and MFSC.
Prior to December 31, 2001, the fund had an unfunded defined benefit plan (“DB plan”) for independent Trustees. As of December 31, 2001, the Board took action to terminate the DB plan with respect to then-current and any future independent Trustees, such that the DB plan covers only certain of those former independent Trustees who retired on or before December 31, 2001. The DB plan resulted in a pension expense of $897 and is included in “Independent Trustees’ compensation” in the Statement of Operations for the six months ended March 31, 2024. The liability for deferred retirement benefits payable to those former independent Trustees under the DB plan amounted to $909 at March 31, 2024, and is included in “Payable for independent Trustees’ compensation” in the Statement of Assets and Liabilities. The deferred retirement benefits compensation fee is accrued daily and paid monthly.
Other — The fund invests in the MFS Institutional Money Market Portfolio which is managed by MFS and seeks current income consistent with preservation of capital and liquidity. This money market fund does not pay a management fee to MFS but does incur investment and operating costs.
During the six months ended March 31, 2024, pursuant to a policy adopted by the Board of Trustees and designed to comply with Rule 17a-7 under the Investment Company Act of 1940 (the “Act”) and relevant guidance, the fund engaged in purchase transactions with funds and account for which MFS serves as investment adviser or sub-adviser (“cross-trades”) which amounted to $9,257,018.
Notes to Financial Statements (unaudited) - continued
The adviser has voluntarily undertaken to reimburse the fund from its own resources on a quarterly basis for the cost of investment research embedded in the cost of the fund’s securities trades. This agreement may be rescinded at any time. For the six months ended March 31, 2024, this reimbursement amounted to $33,563, which is included in “Other” income in the Statement of Operations.
(4) Portfolio Securities
For the six months ended March 31, 2024, purchases and sales of investments, other than short-term obligations, were as follows:
| | Purchases | Sales |
| U.S. Government securities | $1,061,189,660 | $1,202,444,702 |
| Non-U.S. Government securities | 347,557,766 | 584,699,318 |
(5) Shares of Beneficial Interest
The fund's Declaration of Trust permits the Trustees to issue an unlimited number of full and fractional shares of beneficial interest. Transactions in fund shares were as follows:
| | Six months ended
3/31/24 | | Year ended
9/30/23 |
| | Shares | Amount | | Shares | Amount |
| Shares sold | | | | | |
| Class A | 15,337,059 | $290,502,568 | | 30,895,012 | $580,170,699 |
| Class B | 4,278 | 82,001 | | 19,758 | 369,987 |
| Class C | 591,720 | 11,324,100 | | 1,437,928 | 27,257,335 |
| Class I | 3,232,449 | 61,275,989 | | 8,656,719 | 162,456,530 |
| Class R1 | 8,021 | 151,796 | | 18,939 | 355,288 |
| Class R2 | 327,981 | 6,246,598 | | 567,772 | 10,687,880 |
| Class R3 | 865,520 | 16,471,008 | | 1,876,262 | 35,256,883 |
| Class R4 | 552,095 | 10,431,159 | | 1,571,624 | 29,523,343 |
| Class R6 | 5,136,545 | 97,257,272 | | 11,135,706 | 209,429,437 |
| | 26,055,668 | $493,742,491 | | 56,179,720 | $1,055,507,382 |
Shares issued to shareholders
in reinvestment of distributions | | | | | |
| Class A | 12,396,409 | $235,401,115 | | 14,091,229 | $263,806,339 |
| Class B | 75,242 | 1,433,012 | | 121,924 | 2,286,907 |
| Class C | 611,521 | 11,727,981 | | 834,267 | 15,749,169 |
| Class I | 2,223,352 | 42,196,437 | | 2,621,447 | 49,064,749 |
| Class R1 | 15,711 | 297,902 | | 23,095 | 431,295 |
| Class R2 | 206,225 | 3,933,782 | | 267,643 | 5,030,803 |
| Class R3 | 581,977 | 11,063,167 | | 723,974 | 13,568,500 |
| Class R4 | 533,152 | 10,129,993 | | 656,517 | 12,307,902 |
| Class R6 | 2,757,124 | 52,354,413 | | 3,038,763 | 56,906,317 |
| | 19,400,713 | $368,537,802 | | 22,378,859 | $419,151,981 |
Notes to Financial Statements (unaudited) - continued
| | Six months ended
3/31/24 | | Year ended
9/30/23 |
| | Shares | Amount | | Shares | Amount |
| Shares reacquired | | | | | |
| Class A | (24,926,314) | $(471,686,026) | | (41,583,618) | $(781,373,753) |
| Class B | (485,774) | (9,254,116) | | (1,057,462) | (19,894,331) |
| Class C | (2,892,774) | (55,282,967) | | (5,869,176) | (111,207,596) |
| Class I | (6,368,667) | (119,537,319) | | (9,928,365) | (186,303,942) |
| Class R1 | (20,063) | (382,400) | | (178,124) | (3,354,399) |
| Class R2 | (847,005) | (16,126,511) | | (1,458,236) | (27,574,573) |
| Class R3 | (1,394,491) | (26,643,113) | | (3,809,104) | (71,963,943) |
| Class R4 | (5,396,983) | (101,980,451) | | (1,991,477) | (37,458,034) |
| Class R6 | (5,997,552) | (113,290,608) | | (10,144,231) | (190,694,862) |
| | (48,329,623) | $(914,183,511) | | (76,019,793) | $(1,429,825,433) |
| Net change | | | | | |
| Class A | 2,807,154 | $54,217,657 | | 3,402,623 | $62,603,285 |
| Class B | (406,254) | (7,739,103) | | (915,780) | (17,237,437) |
| Class C | (1,689,533) | (32,230,886) | | (3,596,981) | (68,201,092) |
| Class I | (912,866) | (16,064,893) | | 1,349,801 | 25,217,337 |
| Class R1 | 3,669 | 67,298 | | (136,090) | (2,567,816) |
| Class R2 | (312,799) | (5,946,131) | | (622,821) | (11,855,890) |
| Class R3 | 53,006 | 891,062 | | (1,208,868) | (23,138,560) |
| Class R4 | (4,311,736) | (81,419,299) | | 236,664 | 4,373,211 |
| Class R6 | 1,896,117 | 36,321,077 | | 4,030,238 | 75,640,892 |
| | (2,873,242) | $(51,903,218) | | 2,538,786 | $44,833,930 |
Effective June 1, 2019, purchases of the fund’s Class B shares were closed to new and existing investors subject to certain exceptions. Effective September 29, 2023, purchases of the fund's Class R1 and Class R2 shares were closed to new eligible investors.
(6) Line of Credit
The fund and certain other funds managed by MFS participate in a $1.45 billion unsecured committed line of credit of which $1.2 billion is reserved for use by the fund and certain other MFS U.S. funds. The line of credit is provided by a syndicate of banks under a credit agreement. Borrowings may be made for temporary financing needs. Interest is charged to each fund, based on its borrowings, generally at a rate equal to the highest of 1) Daily Simple SOFR (Secured Overnight Financing Rate) plus 0.10%, 2) the Federal Funds Effective Rate, or 3) the Overnight Bank Funding Rate, each plus an agreed upon spread. A commitment fee, based on the average daily unused portion of the committed line of credit, is allocated among the participating funds. The line of credit expires on March 13, 2025 unless extended or renewed. In addition, the fund and other funds managed by MFS have established unsecured uncommitted borrowing arrangements with certain banks for temporary financing needs. Interest is charged to each fund, based on its borrowings, at rates equal to customary reference rates plus an
Notes to Financial Statements (unaudited) - continued
agreed upon spread. For the six months ended March 31, 2024, the fund’s commitment fee and interest expense were $19,318 and $0, respectively, and are included in “Miscellaneous” expense in the Statement of Operations.
(7) Investments in Affiliated Issuers
An affiliated issuer may be considered one in which the fund owns 5% or more of the outstanding voting securities, or a company which is under common control. For the purposes of this report, the following were affiliated issuers:
| Affiliated Issuers | Beginning
Value | Purchases | Sales
Proceeds | Realized
Gain
(Loss) | Change in
Unrealized
Appreciation or
Depreciation | Ending
Value |
| MFS Institutional Money Market Portfolio | $96,489,227 | $542,240,482 | $492,995,025 | $(1,012) | $13,096 | $145,746,768 |
| Affiliated Issuers | Dividend
Income | Capital Gain
Distributions |
| MFS Institutional Money Market Portfolio | $2,474,018 | $— |
Statement Regarding Liquidity Risk Management Program
The fund has adopted and implemented a liquidity risk management program (the “Program”) as required by Rule 22e-4 under the Investment Company Act of 1940, as amended. The fund’s Board of Trustees (the “Board”) has designated MFS as the administrator of the Program. The Program is reasonably designed to assess and manage the liquidity risk of the fund. Liquidity risk is the risk that the fund could not meet requests to redeem shares issued by the fund without significant dilution of remaining investors' interests.
MFS provided a written report to the Board for consideration at its March 2024 meeting that addressed the operation of the Program and provided an assessment of the adequacy and effectiveness of the Program during the period from January 1, 2023 to December 31, 2023 (the “Covered Period”). The report concluded that during the Covered Period the Program had operated effectively in all material respects and had adequately and effectively been implemented to assess and manage the fund’s liquidity risk. MFS also reported that there were no liquidity events that impacted the fund or its ability to timely meet redemptions without dilution to existing shareholders during the Covered Period.
There can be no assurance that the Program will achieve its objectives in the future. Further information on liquidity risk, and other principal risks to which an investment in the fund may be subject, can be found in the prospectus.
Proxy Voting Policies and Information
MFS votes proxies on behalf of the fund pursuant to proxy voting policies and procedures that are available without charge, upon request, by calling 1-800-225-2606, by visiting mfs.com/proxyvoting, or by visiting the SEC’s Web site at http://www.sec.gov.
Information regarding how the fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available by August 31 of each year without charge by visiting mfs.com/proxyvoting, or by visiting the SEC’s Web site at http://www.sec.gov.
Quarterly Portfolio Disclosure
The fund files a complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The fund's Form N-PORT reports are available on the SEC's Web site at http://www.sec.gov. A shareholder can obtain the portfolio holdings report for the first and third quarters of the fund's fiscal year at mfs.com/openendfunds by choosing the fund's name and then scrolling to the “Resources” section and clicking on the “Prospectus and Reports” tab.
Further Information
From time to time, MFS may post important information about the fund or the MFS Funds on the MFS Web site (mfs.com). This information is available at https://www.mfs.com/announcements or at mfs.com/openendfunds by choosing the fund’s name and then scrolling to the “Resources” section and clicking on the “Announcements” tab, if any.
Information About Fund Contracts and Legal Claims
The fund has entered into contractual arrangements with an investment adviser, administrator, distributor, shareholder servicing agent, and custodian who each provide services to the fund. Unless expressly stated otherwise, shareholders are not parties to, or intended beneficiaries of these contractual arrangements, and these contractual arrangements are not intended to create any shareholder right to enforce them against the service providers or to seek any remedy under them against the service providers, either directly or on behalf of the fund.
Under the Trust’s By-Laws and Declaration of Trust, any claims asserted against or on behalf of the MFS Funds, including claims against Trustees and Officers, must be brought in state and federal courts located within the Commonwealth of Massachusetts.
Provision of Financial Reports and Summary Prospectuses
The fund produces financial reports every six months and updates its summary prospectus and prospectus annually. To avoid sending duplicate copies of materials to households, only one copy of the fund’s annual and semiannual report and summary prospectus may be mailed to shareholders having the same last name and residential address on the fund’s records. However, any shareholder may contact MFSC (please see back cover for address and telephone number) to request that copies of these reports and summary prospectuses be sent personally to that shareholder.
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1. Go to mfs.com.
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CONTACT
WEB SITE
mfs.com
MFS TALK
1-800-637-8255
24 hours a day
ACCOUNT SERVICE AND LITERATURE
Shareholders
1-800-225-2606
Financial advisors
1-800-343-2829
Retirement plan services
1-800-637-1255
MAILING ADDRESS
MFS Service Center, Inc.
P.O. Box 219341
Kansas City, MO 64121-9341
OVERNIGHT MAIL
MFS Service Center, Inc.
Suite 219341
430 W 7th Street
Kansas City, MO 64105-1407
Item 1(b):
Not applicable.
ITEM 2. CODE OF ETHICS.
The Registrant has adopted a Code of Ethics (the "Code") pursuant to Section 406 of the Sarbanes-Oxley Act and as defined in Form N-CSR that applies to the Registrant's principal executive officer and principal financial and accounting officer. During the period covered by this report, the Registrant has not amended any provision in the Code that relates to an element of the Code's definition enumerated in paragraph
(b)of Item 2 of this Form N-CSR. During the period covered by this report, the Registrant did not grant a waiver, including an implicit
waiver, from any provision of the Code. David L. DiLorenzo (Principal Executive Officer) and James O. Yost (Principal Financial Officer) were the two persons covered by the Code prior to April 1, 2024. Beginning April 1, 2024, David L. DiLorenzo (Principal Executive Officer) and Kasey L. Phillips (Principal Financial Officer) are the two persons covered by the Code.
A copy of the Code is attached hereto as EX-99.COE.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable for semi-annual reports.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable for semi-annual reports.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable to the Registrant.
ITEM 6. INVESTMENTS
A schedule of investments for each series covered by this Form N-CSR is included as part of the report to shareholders of such series under Item 1(a) of this Form N-CSR.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable to the Registrant.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable to the Registrant.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.
Not applicable to the Registrant.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There were no material changes to the procedures by which shareholders may send recommendations to the Board for nominees to the Registrant's Board since the Registrant last provided disclosure as to such procedures in response to the requirements of Item 407 (c)(2)(iv) of Regulation S-K or this Item.
ITEM 11. CONTROLS AND PROCEDURES.
(a)Based upon their evaluation of the effectiveness of the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the "Act")) as conducted within 90 days of the filing date of this report on Form N-CSR, the Registrant's principal financial officer and principal executive officer have concluded that those disclosure controls and procedures provide reasonable assurance that the material information required to be disclosed by the Registrant on this report is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms.
(b)There were no changes in the Registrant's internal controls over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the period covered by the report that have materially affected, or are 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 to the Registrant.
ITEM 13. RECOVERY OF ERRONEOUSLY AWARDED COMPENSATION.
Not Applicable.
ITEM 14. EXHIBITS.
(a)(1) Any code of ethics, or amendment thereto, that is the subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy the Item 2 requirements through filing of an exhibit: Attached hereto as EX-99.COE.
(2)A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the Act (17 CFR 270.30a-2): Attached hereto as EX-99.302CERT.
(3)Any written solicitation to purchase securities under Rule 23c-1 under the Act (17 CFR 270.23c-1) sent or given during the period covered by the report by or on behalf of the registrant to 10 or more persons. Not applicable.
(4)Change in the registrant's independent public accountant. Not applicable.
(b)If the report is filed under Section 13(a) or 15(d) of the Exchange Act, provide the certifications required by Rule 30a-2(b) under the Act (17 CFR 270.30a-2(b)), Rule 13a-14(b) or Rule 15d-14(b) under the Exchange Act (17 CFR 240.13a-14(b) or 240.15d-14(b)) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350) as an exhibit. A certification furnished pursuant to this paragraph will not be deemed "filed" for the purposes of Section 18 of the Exchange Act (15 U.S.C. 78r), or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference. Attached hereto as EX-99.906CERT.
Notice
A copy of the Amended and Restated Declaration of Trust, as amended, of the Registrant is on file with the Secretary of State of The Commonwealth of Massachusetts and notice is hereby given that this instrument is executed on behalf of the Registrant by an officer of the Registrant as an officer and not individually and the obligations of or arising out of this instrument are not binding upon any of the Trustees or shareholders individually, but are binding only upon the assets and property of the respective constituent series of the Registrant.
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) MFS SERIES TRUST V
By (Signature and Title)*
/S/ DAVID L. DILORENZO
David L. DiLorenzo, President
Date: May 15, 2024
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/ DAVID L. DILORENZO
David L. DiLorenzo, President (Principal Executive Officer)
Date: May 15, 2024
By (Signature and Title)*
/S/ KASEY L. PHILLIPS
Kasey L. Phillips, Treasurer (Principal Financial Officer and Accounting Officer) Date: May 15, 2024
* Print name and title of each signing officer under his or her signature.
