MidCap Growth Fund

Overview

Objective

Seeks capital appreciation.

Strategy

Invests in a diversified portfolio of equity securities of medium-sized companies that show the potential for 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 CFAGX
Cusip 200626505
Minimum Initial Investment $1,000

Commentary

U.S. equity markets rallied to new highs in the 3rd quarter as synchronized global growth increased the prospects of better corporate earnings and overshadowed geopolitical tensions and hurricane events in the Gulf of Mexico. The Commerce Mid Cap Growth Fund rose 3.61%, underperforming the Russell Mid Cap Growth Index return of 5.28%.

Stock selection detracted from the Fund’s relative performance. The Fund’s weakest performers for the period were Regal Entertainment Group (0.00%), Westinghouse Air Brake Technology (0.00%), and Newell Brands (1.14%) down 29%, 22%, and 20%, respectively. The strongest stocks were Rockwell Collins (0.00%), Blue Buffalo Pet Products (1.30%), and T. Rowe Price Group (1.32%), up 25%, 24% and 23%, respectively.

Sector allocation also detracted from the Fund’s relative performance. The Fund’s 5% underweight to the Electronic Technology sector (up 14%), dragged performance. However, the Fund’s 2% underweight to the Retail Trade sector (only up 3%) benefitted performance.

During the quarter the Fund increased its position in the Electronic Technology sector from 8.7% to 11.3%, with the purchase of Trimble Inc. (1.21%) and HEICO Corporation (1.26%), reducing the Fund’s underweight to the sector. The Fund reduced its position in the Technology Services sector from 14.9% to 12.1% through the sale of Red Hat Inc. (0.00%) and PTC Inc. (0.00), creating an underweight to the sector.

Total Fund Assets as of 09/30/2017 $144,817,407
Net Asset Value1 $39.59
Asset Allocation  
Equities 99.5%
Cash 0.5%
Weighted Average Market Capitalization $11,752.00

Holdings

Top Ten Equity Holdings2 as of 09/30/2017

FactSet Research Systems 1.4%
Six Flags Entertainment Corp 1.4%
Cimarex Energy Co. 1.4%
BGC Partners, Inc. 1.4%
NetApp, Inc. 1.4%
Carter's Inc. 1.4%
Bright Horizons Family Solutions 1.3%
T. Rowe Price Group 1.3%
Ross Stores, Inc 1.3%
Blue Buffalo Pet Products 1.3%

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 MidCap Growth Fund Holdings

August, 2017*
September, 2017*
October, 2017*

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.