Growth Fund

Overview

Objective

Seeks capital appreciation.

Strategy

Primarily focuses on the stocks of companies that have shown and are expected to show above-average growth in earnings.

The Management Team

The Fund is managed by the Equity Strategy Team, a group of senior-level investment professionals who average 31 years of experience.

Risk/Return

LOW - - - - - • - HIGH

In general, greater returns are associated with greater risks.

Fund Statistics

Inception Date 12/12/94
Ticker Symbol CFGRX
Cusip 200626406
Minimum Initial Investment $1,000

Commentary

Large cap growth indices climbed to new highs during the 4th quarter as the US and China agreed on terms to de-escalate the Trade war and as the global economy began to show signs that it was stabilizing. The Commerce Growth Fund finished the quarter up 8.05%, underperforming the Russell 1000 Growth Index return of 10.62%

Stock selection was the main detractor from the Fund’s relative performance. Being 1.3% underweight one of the strongest performing stocks, Apple (7.41%), up 32%, hurt performance, as well as weak stock selection in Public Storage (1.13%) and Yum! Brands (1.14%) which were down -12% and -11%. The Fund’s strongest stocks were Amgen (1.17%), Rockwell Automation (0.99%), and Marriott International (1.23%), up 25%, 24%, and 22% respectively.

The Fund’s sector allocations slightly detracted from relative performance as well. The Fund’s 3.4% overweight to the Industrials sector (only up 2.6%) hurt performance. However, the 1.3% underweight to the Consumer Staples sector (only up 3.6%), helped performance.

During the quarter the Fund increased its position in the Health Care sector from 11.6% to 12.9%, with the purchase of Zoetis, Inc. (1.05%), which reduced the Fund’s underweight to the sector. The Fund reduced its overweight to Financials with the sale of Charles Schwab Corporation (0.00%), reducing the sector’s weight from 4.6% to 3.2%.

Total Fund Assets as of 12/31/2019 $174,029,811
Net Asset Value1 $37.48
Asset Allocation  
Equities 99.7%
Cash 0.3%
Weighted Average Market Capitalization $340.0 Billion

Holdings

Top Ten Equity Holdings2 as of 12/31/2019

Apple Inc 7.5%
Microsoft Corporation 6.5%
Alphabet Inc, Class A 4.4%
Amazon.com, Inc 4.3%
Facebook, Inc. Class A 2.8%
Visa Inc. Class A 1.8%
iShares Russell 1000 Growth ETF 1.6%
UnitedHealth Group Incorporated 1.5%
Mastercard Incorporated Class A 1.5%
Marriot International, Class A 1.2%

Footnotes:
1. The Net Asset Value represents the assets of the fund (ex dividend) by the total number of shares.
2. The composition of the portfolio is subject to change in the future.
3. The Russell 1000 Growth Index is an unmanaged index that measures the performance of those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values. The Index figures do not reflect any fees or expenses.

Portfolio Holdings

The Fund invests in mid-capitalization securities. The securities of mid-capitalization companies involve greater risks than those associated with larger, more established companies and may be subject to more abrupt or erratic price movements.

Holdings and allocations shown are unaudited, and may not be representative of current or future investments. Holdings and allocations may not include the Fund's entire investment portfolio, which may change at any time. Fund holdings should not be relied on in making investment decisions and should not be construed as research or investment advice regarding particular securities.

Commerce Growth Holdings

November 2019*
December 2019*
January 2020*

A prospectus for the Commerce Funds containing more complete information may be obtained by calling 1-800-995-6365 or by downloading it from this website. Please consider a Fund's objectives, risks, and charges and expenses, and read the prospectus carefully before investing. The prospectus contains this and other information about the Fund.

The mutual funds referred to in this Web site are offered and sold only to persons residing in the United States and are offered by prospectus only. The prospectus contains more complete information about the funds, including charges and expenses, and should be read carefully before investing.