Metzler/Payden European Emerging Markets Fund

Awards
Returns Growth of $10k chart
* The chart illustrates the performance of a hypothetical $10,000 investment made in the fund on commencement of operations. Figures include reinvestment of capital gains and dividends, but do not reflect the effect of any applicable sales charges or redemption fees, which would lower these figures. This chart is not intended to imply any future performance of the fund.

Fund Facts
Sector Breakdown
Country breakdown chart
Minimum Investment

Why invest in this fund?
• Potential for enhanced returns
• Excellent diversification tool
• Exposure to developing European markets
• Invests in countries forecasted to expand at a greater rate than that of developed
economies over the next five years
• Low expense ratio
• Managed by investment team based in Europe

Investment strategy
This fund invests in Europe’s developing economies in the Central and Eastern parts of the continent. Our stock selection approach utilizes a combination of top down and bottom up analysis. We start with an evaluation of economic conditions, singling out sectors of interest, and a proprietary quantitative model that screens and ranks securities based on valuation and momentum. Once the model generates a list of companies with the most attractive metrics, we conduct in-depth qualitative analysis, which often includes visiting companies on-site and meeting company management.

Emerging markets defined
We consider countries with per capita income below a certain level that are experiencing profound economic changes to be emerging markets. Often times, they are transitioning from a command economy to a free market economy, where the allocation of resources is determined by supply and demand. As applied to Eastern European countries, the term “developing” more accurately describes the majority of our investment universe. This region is set apart by higher incomes, better education, and stronger sovereign credit ratings than the average “emerging” economy, making it unique in the emerging market investment universe.

Meet the manager
Markus Brück joined Metzler as Senior Equity Portfolio Manager in 2002. His primary responsibility is management of Eastern European portfolios. Before joining Metzler, he had various fund and portfolio management responsibilities at Credit Suisse Asset Management, Frankfurt/Main, Germany; Deka Investment Management GmbH; and WestLB Capital Management GmbH, Düsseldorf/Germany. Mr. Brück holds a degree in economics from the Justus Liebig University of Gießen/Germany.

Quarter-End Commentary
Investors worldwide remain focused on the sustainability of global growth given the visible slowdown in the US and the threat of inflation. Eastern Europe, while certainly not immune from the market’s ills, is weathering the storm better than most expected. Eastern European equities performed well in April, despite reports that Russian oil output fell by 1% in the first quarter of 2008 versus the fourth quarter of 2007. May was another strong month for equities in the region; Russia’s rally was driven by two main factors, the continued increase in oil prices and the parallel events of Medvedev’s presidential inauguration and Putin’s appointment as the head of government. Risky assets faced challenges in June, as Turkey’s economy and politics were among the more notable market drivers in the region.

As we enter the third quarter of the year, slowing global economic growth combined with accelerating regional inflation remains the biggest challenge for policymakers and markets. While there are varying degrees of exposure to these issues (e.g. Russia’s economy benefits from higher oil prices but higher oil is negative for most other countries in the region), it is important that central banks navigate monetary policy carefully. Risk aversion also continues to have a dampening impact on investment flows to the region.

Quoted performance data represent past performance, which does not guarantee future results. Investment returns and principal value will fluctuate, so investors' shares when sold, may be worth more or less than their original cost. For the most recent month-end performance, which may be higher or lower than that quoted, browse this website or call 866 673-8637. Investment in foreign securities offers different rewards and challenges from investing in domestic securities, including changes in exchange rates, political changes, and differences in reporting standards, and for emerging-market securities, greater volatility. Before investing, investors should carefully read and consider investment objectives, risks, charges, expenses and other important information, which are contained in the prospectus. For more information and to obtain a prospectus, browse this website or call 866 673-8637. The Metzler/Payden Funds are distributed by Payden & Rygel Distributors member FINRA.

©2008 Morningstar, Inc. All rights reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.

For each fund with at least a three-year history, Morningstar calculates a Morningstar Rating based on a Morningstar risk-adjusted return measure that accounts for variation in a fund's monthly performance (including the effects of sales charges, loads and redemption fees), placing more emphasis on downward variations and rewarding consistent performance. The top 10% of funds in each category receive five stars, the next 22.5% receive four stars, and the next 35% receive three stars. Highly rated funds are defined as those that have a four or five star Morningstar rating. An overall rating is based on a weighted average of the fund's ratings for the three-, five-, and ten-year periods, if applicable. Data provided by Morningstar, Inc. Although gathered from reliable sources, data completeness and accuracy cannot be guaranteed. Morningstar is a registered trademark of Morningstar, Inc. and is not affiliated with Metzler/Payden Funds.

Lipper ratings are subject to change every month and are based on an equal-weighted average of percentile ranks for the Total Return, Consistent Return, Preservation, Tax Efficiency, and Expense metrics over three-, five-, and ten-year periods (if applicable). The highest 20% of funds in each peer group are named Lipper Leaders or a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2, and the lowest 20% are scored 1. Lipper ratings for Total Return reflect funds' historical total return performance relative to peers as of 12/31/07.