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Mid Cap Index

as of 12/31/17

Fund Commentary

In the fourth quarter of 2017, the S&P 400® Index returned 6.25%. Mid cap equities underperformed large cap equities, as measured by the S&P 500® Index, which returned 6.64% in the fourth quarter.

The top-performing sectors over this time period were consumer discretionary and energy, returning 10.00% and 9.91%, respectively. Telecommunications services and health care were the worst-performing sectors for the quarter, with returns of -5.72% and 1.95%, respectively.

The top-performing securities over this time period were CalAtlantic Group, Inc. and Skechers U.S.A., Inc., returning 54.06% and 50.82%, respectively. Mallinckrodt Plc and 3D Systems Corporation were the worst-performing securities for this quarter, with returns of -39.63% and -35.47%, respectively. Small capitalization equities can tend to be more volatile both to the up and down side which can help explain the significant movement in individual names for the quarter.

The Mid Cap Index Fund posted a total return of 6.18% for the fourth quarter compared to the 6.25% return of the Fund's benchmark, the S&P Midcap 400® Index. U.S. equities in the fourth quarter of 2017 continued to rally off of the strong first three quarters of the year. The S&P 500® Index posted, for the first time ever, positive performance in each of the twelve months of a calendar year, pushing the index to new all-time highs for the quarter, and keeping volatility near all-time lows. Market participants continued to shrug off geopolitical turmoil in North Korea and the Middle East, and instead focused on continued global growth. The fourth quarter also saw the Federal Reserve begin the process of unwinding their balance sheet while keeping with intentions for continued gradual interest rate increases. These announcements, coupled with the late year passing of US tax reform, led to an increase in market optimism and interest rates, benefitting equities on the whole.

Holdings are subject to change and current and future portfolio holdings are subject to risk.

Not FDIC insured | May lose value | No bank guarantee

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