Waddell & Reed

Fund Detail

WRA Government Securities Fund
Class A Shares

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Fund Facts
Ticker Symbol UNGVX
CUSIP 930055108
Fund Code 753
Fund Type Fixed Income Funds
Fund Inception 4/10/1984
Class Inception 4/10/1984
Fiscal Year End September
Dividends Paid Daily, Paid Monthly
Fund Assets (as of 8/31/2014) $262.9 mil
Total Holdings (as of 8/31/2014) 58
Lipper Category General U.S. Government Fds
Morningstar Category Intermediate Government
Benchmarks Barclays US Govt/Mortgage TR USD
Daily Prices
as of 9/19/2014
Net Asset Value (NAV) $5.48
NAV Change ($) $0.00
NAV Change (%) 0.00%
Weekly NAV Change ($) $0.00
Weekly NAV Change (%) 0.00%
Public Offering Price (POP) $5.72
Historical Prices & Distributions
Please select a date
Fund Description
Fund Objective
To seek to provide current income consistent with preservation of capital.

Investment Approach
The Fund invests in a diversified portfolio of U.S. government securities, including securities issued by the Treasury and government agencies and mortgage-backed securities also issued by government agencies. Because the Fund owns different types of government fixed-income instruments, a variety of factors can affect its investment performance, such as an increase in interest rates, adverse bond and stock market conditions, and prepayment of higher-yielding bonds and mortgage-backed securities.
Morningstar Style Box
Source: Morningstar
Returns and Expenses

Data quoted is past performance and current performance may be lower or higher. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.

Performance at NAV does not include the effect of sales charges. Class A shares, including sales charges, reflects the maximum applicable front-end sales load.

Monthly Rates of Return Average Annual Total Returns
as of 8/31/2014
  YTD 1yr 3yr 5yr 10yr Life
Fund at NAV 2.61% 2.82% 0.53% 2.26% 3.18% 6.59%
Fund with 4.25% sales charge -1.72% -1.51% -0.92% 1.38% 2.73% 6.44%
Barclays US Govt/Mortgage TR USD 3.90% 4.33% 1.92% 3.51% 4.46% N/A
Quarterly Rates of Return Average Annual Total Returns
as of 6/30/2014
  YTD 1yr 3yr 5yr 10yr Life
Fund at NAV 2.33% 1.31% 1.65% 2.45% 3.42% 6.62%
Fund with 4.25% sales charge -2.00% -3.07% 0.19% 1.56% 2.96% 6.47%
Barclays US Govt/Mortgage TR USD 4.03% 4.66% 2.80% 3.92% 4.95% N/A
Lipper General U.S. Government Fds 3.60% 2.66% 2.57% 3.42% 3.89% N/A
Expense Ratios
as of 1/31/2014
Net 1.06%
Gross 1.06%
12-Month Trailing Distribution Yield
as of 8/31/2014
NAV 1.69%
With sales charge 1.61%
Annualized 30-Day SEC Yield
as of 8/31/2014
Subsidized 1.37%
Unsubsidized 1.29%
Growth of a $10,000 Investment
through 8/31/2014
 Government Securities A
 Barclays US Govt/Mortgage TR USD

Assumes an investment over 10 years or life of the share class, reinvestment of dividends and capital gains, and does not include the effect of sales charges or taxes.

Ratings and Rankings
Lipper Rankings
as of 8/31/2014
Category: General U.S. Government Fds
  Rank Percentile
1 Year 98 / 114 86
3 Year 95 / 109 87
5 Year 78 / 101 77
10 Year 55 / 80 68

Rankings are based on average annual total returns, but do not consider sales charges.

Morningstar Ratings
as of 8/31/2014
Category: Intermediate Government
Overall (out of 302 Intermediate Government)
3 Year (out of 302 Intermediate Government)
5 Year (out of 283 Intermediate Government)
10 Year (out of 235 Intermediate Government)

Ratings are based on risk-adjusted returns.

Portfolio Composition
(as a % of net assets as of 8/31/2014)
Government Bonds 98.51%
Cash and Cash Equivalents 1.49%
(as a % of bond holdings as of 8/31/2014)
Gov't 100.0 %

Quality: Our preference is to always use ratings obtained from Standard & Poor's. For securities not rated by Standard & Poor's, ratings are obtained from Moody's. We do not evaluate these ratings, but simply assign them to the appropriate credit quality category as determined by the rating agency.

(as a % of bond holdings as of 8/31/2014)
<1 Year 1.1 %
1-5 Years 52.8 %
5-10 Years 38.7 %
10-20 Years 7.4 %
>20 Years 0.0 %
Average Maturity 4.54 years
Effective Duration 3.39 years

Average maturity and effective duration include bonds, cash and cash equivalents.

Top 10 Holdings
(as a % of net assets as of 8/31/2014)
United States Treasury Notes, 3.63%, 8/15/2019U.S. Treasury Notes, 3.6%, 8/15/2019 6.3%
Federal Home Loan Bank, 3.5%, 7/29/2021 5.3%
United States Treasury Bonds, 9.00%, 11/15/2018U.S. Treasury Bonds, 9.0%, 11/15/2018 5.0%
Federal Home Loan Bank, 3.6%, 3/12/2021 4.1%
Federal Farm Credit Bank, 2.6%, 3/26/2021 4.1%
U.S. Treasury Notes, 3.1%, 5/15/2021 4.1%
Federal National Mortgage Association, 2.0%, 6/14/2032 3.8%
Federal Home Loan Bank, 4.5%, 9/13/2019Federal Home Loan Bank, 4.5%, 9/13/2019 3.4%
Federal National Mortgage Association Fixed Rate Pass-Through Certificates, 2.8%, 11/1/2018 3.2%
Federal National Mortgage Association Fixed Rate Pass-Through Certificates, 4.4%, 6/1/2021 3.2%
Total Portfolio Holdings
(updated quarterly, upon availability)

View | Download (as of 6/30/2014)
Portfolio Management
Manager Name Company Name Years in Industry Years with Fund
Mark J. Otterstrom is a senior vice president for Waddell & Reed Investment Management Company. Mr. Otterstrom graduated in 1979 with a BS in finance from the University of Tulsa. He earned a MBA in finance from the University of Missouri at Kansas City in 1986. He was previously affiliated with the Federal Reserve Bank of Kansas City as a bank holding company examiner. Mr. Otterstrom joined Waddell & Reed in May of 1987 as a fixed-income specialist with emphasis in high yield municipal bonds. He was appointed assistant vice president in January 1995 and vice president in January 1996. He became portfolio manager of Ivy Funds VIP Bond in September 2008. Mr. Otterstrom is a Charted Financial Analyst. He is a member of the Association for Investment Management and Research (AIMR), and the Kansas City Society of Financial Analysts.Mark J. Otterstrom, CFA Waddell & Reed Investment Management Company 28 6
Susan K. Regan is a Vice President of Waddell & Reed Investment Management Company. Ms. Regan earned a BA in economics in May 1984 and an MA in economics in December 1985 from the University of Missouri-Columbia. Ms. Regan joined Waddell & Reed in 2007 as a fixed income investment analyst and trader. She was appointed assistant vice president and assistant portfolio manager in 2010; and vice president and portfolio manager in 2014. Prior to joining Waddell & Reed, she was employed by Commerce Bank from 1988 to 2007, where she gained experience trading governments, agency and mortgage-backed securities. From 1987 through 1988 she was associated with the Missouri State Treasurer’s Office and from 1986 to 1987 the Missouri Department of Revenue.Susan K. Regan Waddell & Reed Investment Management Company 27 <1

Risk Factors: As with any mutual fund, the value of the Fund's shares will change, and you could lose money on your investment. An investment in the Fund is not a bank deposit and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. These and other risks are more fully described in the fund's prospectus. Not all funds or fund classes may be offered at all broker/ dealers.

Pricing: All prices and year-to-date returns are based on closing quotes unless noted, as supplied to the NASDAQ by 6:00 p.m. Eastern time.

Stylebox: The Morningstar Fixed Income style box reveals a fund’s investment style. The vertical axis shows the credit quality of the bonds owned and the horizontal axis shows interest rate sensitivity as measured by a bond’s effective duration. Morningstar seeks credit rating information from fund companies on a periodic basis (e.g., quarterly). In compiling credit rating information, Morningstar instructs fund companies to only use ratings that have been assigned by a Nationally Recognized Statistical Rating Organization (NRSRO). If two NRSROs have rated a security, fund companies are to report the lowest rating; if three or more NRSROs have rated the same security differently, fund companies are to report the rating that is in the middle. Credit quality breakdowns are shown for corporate-bond holdings and depict the quality of bonds in the underlying portfolio. The report shows the percentage of fixed-income securities that fall within each credit quality rating as assigned by an NRSRO. Bonds not rated by an NRSRO are included in the not rated (NR) category. Please note: Morningstar, Inc. is not itself an NRSRO nor does it issue a credit rating on the fund. An NRSRO rating on a fixed-income security can change from time-to-time. For credit quality, Morningstar combines the credit rating information provided by fund companies with an average default rate calculation to come up with a weighted-average credit quality. The weighted-average credit quality is currently a letter that roughly corresponds to the scale used by a leading NRSRO. Bond funds are assigned a style box placement of “low,” “medium,” or “high” based on their average credit quality. Funds with a low credit quality are those whose weighted-average credit quality is determined to be less than “BBB-;” medium are those less than “AA-,” but greater or equal to “BBB-;” and high are those with a with a weighted-average credit quality of “AA-” or higher. When classifying a bond portfolio, Morningstar first maps the NRSRO credit ratings of the underlying holdings to their respective default rates (as determined by Morningstar’s analysis of actual historical default rates). Morningstar then averages these default rates to determine the average default rate for the entire bond fund. Finally, Morningstar maps this average default rate to its corresponding credit rating along a convex curve. For interest-rate sensitivity, Morningstar obtains from fund companies the average effective duration. Generally, Morningstar classifies a fixed-income fund’s interest-rate sensitivity based on the effective duration of the Morningstar Core Bond Index (MCBI), which is currently three years. The classification of Limited will be assigned to those funds whose average effective duration is between 25% to 75% of MCBI’s average effective duration; funds whose average effective duration is between 75% to 125% of the MCBI will be classified as Moderate; and those that are at 125% or greater of the average effective duration of the MCBI will be classified as Extensive.

Index Description: Barclays US Govt/Mortgage TR USD - The Barclays U.S. Government/Mortgage-Backed Securities Index measures the performance of U.S. government bonds and mortgage-related securities. It is not possible to invest directly in an index.

Performance results for some funds may include the effect of expense reduction arrangements. If those arrangements had not been in place, the performance results would have been lower.

Unsubsidized yields reflect what the yield would have been without the effect of reimbursements and waivers. The adviser and its affiliates have or may voluntarily waive a portion of their fees (including, but not limited to, distribution and service (12b-1) fees) and reimburse certain expenses. There is no guarantee that the fund will avoid a negative yield. Such undertaking may be amended or withdrawn at any time.

30-Day SEC Yield: is calculated based on a formula mandated by the Securities and Exchange Commission (SEC) that calculates a fund's hypothetical annualized income, as a percentage of its assets. A security's income, for the purposes of this calculation, is based on the current market yield to maturity (in the case of bonds) or projected dividend yield (for stocks) of the fund's holdings over a trailing 30 day period. This hypothetical income will differ (at times, significantly) from the fund's actual experience; as a result, income distributions from the fund may be higher or lower than implied by the SEC yield.

12-Month Trailing Distribution Yield: at NAV refers to the 12-month historical cash flow paid over the past 12 months in dividends, divided by the past months ending NAV.

Morningstar Ratings: For each fund with at least a 3-year history, Morningstar calculates a risk-adjusted return measure that accounts for variation in a fund's monthly performance (including the effects of all sales charges), placing emphasis on downward variations and rewarding consistent performance. The top 10% of funds in each category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars and the bottom 10% receive 1 star. (Each share class is counted as a fraction of one fund and rated separately.) A fund's overall rating is derived from a weighted average of the 3-, 5- and 10-year (if applicable) rating metrics. Morningstar Rating is for the share classes specified; other classes may have different performance characteristics.

Information is subject to change and is not intended to represent any past or future investment recommendations.

Quality: Our preference is to always use ratings obtained from Standard & Poor's. For securities not rated by Standard & Poor's, ratings are obtained from Moody's. We do not evaluate these ratings, but simply assign them to the appropriate credit quality category as determined by the rating agency.

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