Manager Commentary as of 12/31/2011

• In the fourth quarter of 2011, the Westcore Select Fund outperformed its benchmark returning 12.11% compared to the Russell Midcap^® Growth Index’s 11.24% return. 

• Equity markets rebounded in the fourth quarter as perceived risk from the debt crisis in Europe partially subsided and U.S. economic data proved better than expected.  Volatility remained at elevated levels, giving us opportunities to add to existing positions and find new investment ideas where we saw attractive long-term fundamentals. 

• The three sectors that contributed most to the Fund’s performance relative to our benchmark in the fourth quarter were health care, consumer discretionary, and consumer staples.  Within the health care sector, the Fund’s best performing stock was Varian Medical Systems, Inc., a leading provider of radiation oncology equipment.  Varian benefited from the fourth quarter announcement that Siemens, the third largest market participant in radiation oncology, plans to exit the market.  Within the consumer discretionary sector, the Fund’s best performing stock was TJX Cos., the world’s largest off-price retailer.  TJX performed well during the quarter as the company’s value strategy and premium inventory drove strong customer demand.  The Fund’s underweight in the consumer staples sector aided performance in the quarter as the sector produced low returns. 

• The three sectors that detracted most from the Fund’s performance relative to the benchmark in the quarter were information technology, materials, and financials.  Within the information technology sector, Avago Technologies Ltd., a leading semiconductor vendor to the industrial and communications markets, was the Fund’s largest detractor.  Avago lagged in the period as concerns over industrial end markets in Asia and anticipation of peaking growth in its wireless segments pressured the stock price.  The Fund didn’t own any materials sector companies in the fourth quarter, and our underweight position in the sector hurt performance.  Within the financials sector, the Fund’s largest detractor was Zions Bancorporation, a regional bank operating in the western United States.  We believe operational trends at the bank are improving; however, macroeconomic concerns weighed on the stock price in the fourth quarter.

• As of the end of the fourth quarter of 2011, the Fund’s primary overweight positions were in the consumer discretionary, information technology, and health care sectors and its primary underweight positions were in the industrials, materials, and energy sectors. 

• The global growth outlook is mixed.  While the U.S. outlook appears to be improving, there are concerns over a slowdown in China and a recession in Europe.  We’ve positioned the portfolio with a focus on long-term growth companies that we believe have attractive valuations and can outperform despite slowing growth outside the U.S.  Our underweight positions currently include sectors that are dependent on global cyclical forces.    

• As always, we thank you for your continued investment.

The performance data quoted represents past performance and does not guarantee future results. Current performance may be lower or higher than the performance data quoted. Investment return and principal value will vary, and shares, when redeemed, may be worth more or less than their original cost. To obtain current performance as of the most recent month-end, please call 800.392.CORE (2673) or visit the Performance tab. 

 

Stock Performance (3 months ended 12/31/2011)