Delaware Focus Global Growth Fund

Objective

Delaware Focus Global Growth Fund seeks long-term capital appreciation.

Strategy

The Fund invests primarily in common stocks of U.S. and non-U.S. companies, which may include companies located or operating in developed or emerging markets. Under normal circumstances, the Fund will invest in equity securities of issuers located throughout the world, including the United States, and the Fund will invest at least 40% of its net assets in non-U.S. securities. The Fund may invest in companies across all market capitalizations but will primarily invest in mid- and large-cap equity securities.

Fund information
Inception date12/29/2008
Dividends paid (if any)Annually
Capital gains paid (if any)December
Fund identifiers
NASDAQDGGAX
CUSIP246118541
Investment minimums
Initial investment$1,000
Subsequent Investments$100
Systematic withdrawal balance$5,000
Account features
CheckwritingNo
Payroll DeductionYes
IRAsYes

The performance quoted represents past performance and does not guarantee future results. Investment return and principal value of an investment will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted.

Total returns may reflect waivers and/or expense reimbursements by the manager and/or distributor for some or all of the periods shown. Performance would have been lower without such waivers and reimbursements.

Average annual total return as of month-end (11/30/2014)
YTD1 year3 year5 year10 yearLifetimeInception date
NAV (view definition)3.46%6.37%14.01%13.39%n/a18.63%12/29/2008
Max offer price-2.48%0.25%11.77%12.06%n/a17.45%
MSCI World Index (Gross)7.19%9.50%16.73%11.57%n/an/a
MSCI World Index (Net)6.66%8.91%16.08%10.96%n/an/a
Average annual total return as of quarter-end (09/30/2014)
QTDYTD1 year3 year5 year10 yearLifetimeInception date
NAV (view definition)-3.91%-1.24%6.25%15.36%13.14%n/a18.27%12/29/2008
Max offer price-9.46%n/a0.13%13.11%11.81%n/a17.05%
MSCI World Index (Gross)-2.05%4.33%12.80%18.60%11.47%n/an/a
MSCI World Index (Net)-2.16%3.89%12.20%17.93%10.86%n/an/a

Returns for less than one year are not annualized.

Class A shares have a maximum up-front sales charge of 5.75% and are subject to an annual distribution fee.

Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index.

Prior to Dec. 29, 2010, the Fund had not engaged in a broad distribution of its shares and had been subject to limited redemption requests. The returns reflect expense limitations that were in effect during certain periods and that may have been lower than the Fund's current expenses. The returns would have been lower without the expense limitations.

Expense ratio
Gross1.51%
Net1.51%
Quarterly total returns @ NAV
Year1st quarter2nd quarter3rd quarter4th quarterAnnual return
2014-1.34%4.18%-3.91%n/an/a
20135.38%-1.60%10.56%7.58%23.33%
201216.54%-6.50%5.40%2.37%17.57%
20114.13%3.42%-15.41%7.21%-2.34%
20104.40%-8.51%18.42%8.25%22.44%
2009-0.46%21.59%15.55%8.24%51.36%
Portfolio characteristics - as of 11/30/2014
Share assets$28.6 million
Number of holdings38
Market cap (median)$27.27 billion
Market cap (weighted average)$71.57 billion
Portfolio turnover (last fiscal year)36%
Beta (relative to MSCI World Index (Gross)) (view definition)1.09
Annualized standard deviation, 3 years (view definition)11.78
Portfolio composition as of 11/30/2014Total may not equal 100% due to rounding.
Domestic equities58.1%
International equities & depository receipts41.1%
Cash and cash equivalents0.9%
Top 10 holdings as of 11/30/2014
Holdings are as of the date indicated and subject to change.
List excludes cash and cash equivalents.
Holding% of portfolio
Celgene Corp.5.1%
Baidu Inc.4.2%
Allergan Inc.4.2%
Priceline Group Inc.3.7%
MasterCard Inc.3.4%
Visa Inc.3.3%
Microsoft Corp.3.3%
QUALCOMM Inc.3.1%
Intercontinental Exchange Inc.3.0%
eBay Inc.3.0%
Total % Portfolio in Top 10 holdings36.3%

Holdings are as of the date indicated and subject to change.

Top 10 countries as of 11/30/2014List excludes cash and cash equivalents.
Country% of portfolio
United States58.1%
United Kingdom7.9%
Japan4.8%
Spain4.3%
China4.2%
Switzerland3.7%
Brazil3.1%
India2.9%
France2.7%
Taiwan2.6%
Distribution history - annual distributions (Class A)1,2
Distributions ($ per share)
YearCapital gains3Net investment
income
20140.0000.000
20130.3230.000
20120.0000.000
20110.1110.000
20100.4060.028
20091.1700.027
20080.0000.000
20070.0000.000
20060.0000.000
20050.0000.000
20040.0000.000

1If a Fund makes a distribution from any source other than net income, it is required to provide shareholders with a notice disclosing the source of such distribution (each a "Notice"). The amounts and sources of distributions reported above and in each Notice are only estimates and are not provided for tax reporting purposes. Each Fund will send each shareholder a Form 1099 DIV for the calendar year that will provide definitive information on how to report the Fund's distributions for federal income tax purposes. The information in the table above will not be updated to reflect any subsequent recharacterization of dividends and distributions. Click here to see recent Notices pertaining to the Fund (if any).

2Information on return of capital distributions (if any) is only provided from June 1, 2014 onward.

3Includes both short- and long-term capital gains.

Investment manager

Delaware Management Company, a series of Delaware Management Business Trust

Sub-advisors

Jackson Square Partners, LLC


Greg Heywood

Gregory M. Heywood, CFA

Portfolio Manager, Equity Analyst — Jackson Square Partners, LLC

Start date on the Fund: December 2008

Years of industry experience: 21

(View bio)


Patrick Fortier

Patrick G. Fortier, CFA

Portfolio Manager, Equity Analyst — Jackson Square Partners, LLC

Start date on the Fund: December 2008

Years of industry experience: 19

(View bio)


Chris Bonavico

Christopher J. Bonavico, CFA

Portfolio Manager, Equity Analyst — Jackson Square Partners, LLC

Start date on the Fund: December 2008

Years of industry experience: 26

(View bio)


You may qualify for sales-charge discounts if you and your family invest, or agree to invest in the future, at least $50,000 in Delaware Investments® Funds. More information about these and other discounts is available from your financial advisor, in the Fund's prospectus under the section entitled "About your account," and in the Fund's statement of additional information (SAI) under the section entitled "Purchasing Shares."

The table below describes the fees and expenses that you may pay if you buy and hold shares of the Fund.

Shareholder fees
Maximum sales charge (load) imposed on purchases as a percentage of offering price5.75%
Maximum contingent deferred sales charge (load) as a percentage of original purchase price or redemption price, whichever is lowernone
Annual fund operating expenses
Management fees0.85%
Distribution and service (12b-1) fees0.25%
Other expenses0.41%
Total annual fund operating expenses1.51%
Fee waivers and expense reimbursementsnone
Total annual fund operating expenses after fee waivers and expense reimbursements1.51%

1The Fund's investment manager, Delaware Management Company (Manager), has contractually agreed to waive all or a portion of its investment advisory fees and/or pay/reimburse expenses (excluding any 12b-1 fees, taxes, interest, short sale and dividend interest expenses, brokerage fees, certain insurance costs, acquired fund fees and expenses, and nonroutine expenses or costs, including, but not limited to, those relating to reorganizations, litigation, conducting shareholder meetings, and liquidations) in order to prevent annual fund operating expenses from exceeding 1.30% of the Fund's average daily net assets from March 28, 2014 through March 30, 2015. This waiver and/or reimbursement may only be terminated by agreement of the Manager and the Fund.

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Delaware Focus Global Growth Fund Quarterly commentary September 30, 2014

Within the Fund

For the third quarter of 2014, Delaware Focus Global Growth Fund (Class A and Institutional Class shares at net asset value) posted a negative return and underperformed its benchmark, the MSCI World Index (net). Strong relative performance in the information technology and healthcare sectors was unable to overcome weak relative performance in the industrials and consumer discretionary sectors.

Baidu, the market leader in search engines within China, was a strong contributor to performance during the quarter. The stock rose as the company reported earnings that exceeded consensus estimates driven, in part, by strong growth in its mobile services. Baidu’s heavy capital investment in its mobile related services appears to already be providing benefits for the company. We believe the company stands to benefit widely from the proliferation of wireless and streaming technologies in China, making Baidu’s services even more accessible. We feel the company has upside potential given the sheer size of the Chinese market population, and with ancillary businesses that are becoming significant drivers of growth including social media, multimedia sharing services, and mobile search.

Celgene contributed to performance during the quarter. The stock appreciated, in part, because the United Kingdom’s cost agency reversed course and gave positive draft guidance for use of one of Celgene’s drugs that was rejected the prior year. Celgene continues to be a leading player in the treatment of blood cancers with a growing product pipeline in breast, lung, and pancreatic cancer treatments. Additionally, the company continues to benefit from large growth prospects driven by additional indications of its drugs, by increased usage of existing drugs, and by international growth opportunities.

eBay was also a contributor to performance during the quarter. There were several events during the period that helped drive stock performance. The stock initially rose during July after reporting relatively strong financial results. Additionally, investors seemed to move past what we believed to be certain transitory issues that affected eBay (including a data breach and changes to Google’s search engine which decreased customer traffic). The big news for the quarter, however, was eBay’s announcement that the company will spin out its mobile payments service business, PayPal, forming two independently traded companies beginning in 2015. While we feel this is the first step toward a positive development, there are still many iterations to come in terms of how eBay executes the split, who ultimately manages the eBay and PayPal entities, and how the market values each as a standalone company.

Kakaku.com detracted from performance during the quarter. The stock experienced some weakness after the company reported financial results that slightly missed some analyst estimates due, in part, to increased investment in its restaurant reservation business, Tabelog. We believe this expansion of Tabelog should help strengthen its competitiveness and further enhance its growth potential. We continue to believe Kakaku is one of the most compelling companies that is participating in what we expect to be a multi-year period of e-commerce acceleration in Japan. We believe the company’s entrepreneurial approach to testing and rolling out new verticals, combined with a capital-light model and an enhanced management team, creates an attractive investment opportunity.

EOG Resources was another detractor from performance during the quarter. After the stock price reached an all-time high during the prior quarter, the stock experienced some weakness as oil prices also fell off from recent highs. Additionally, many investors may have continued to lock in gains after strong stock appreciation over the past year. We continue to believe that the company is well positioned to provide exposure to the North American shale oil and gas industry which, in our view, is an attractive secular growth area in energy.

Admiral Group, a U.K.-based automobile insurance company, was also a detractor from performance during the quarter. While the company reported relatively solid financial results, there were increased concerns related to falling insurance premium prices, especially in the U.K. Additionally, a U.K. regulatory body’s annual report created concerns that capital requirement for certain types of insurers could be increased. Given various industry and regulatory headwinds that the company may experience for some time, we decided to exit the Fund’s position and allocate to what we viewed as more attractive opportunities.

Outlook

Despite positive absolute returns in the equity market during the past few years, we believe the relatively tepid market sentiment demonstrates that there are more than just fundamental factors affecting stock prices. A lack of significant bull market sentiment suggests to us that many investors appear to be struggling with accurately predicting the pace of global economic recovery and are assessing factors that threaten economic fundamentals (for example, central bank actions and fiscal policy debates across the globe). While some fundamentals in various geographies may be trending in a positive direction (from a very low base during the global financial crisis in 2008-2009), we don’t believe we are entering into a typical post-recessionary global boom cycle. Rather, we believe the lingering effects of the credit crisis years ago could lead to moderate growth, at best, for the intermediate term. In such a tenuous environment, we believe the quality of a company’s business model, competitive position, and management may prove to be of utmost importance.

Regardless of the economic outcome, we remain consistent in our long-term investment philosophy: We want to own what we view as strong secular-growth companies with solid business models and competitive positions that we believe can grow market share and have the potential to deliver shareholder value in a variety of market environments.

[13398]

The views expressed represent the Manager's assessment of the Fund and market environment as of the date indicated, and should not be considered a recommendation to buy, hold, or sell any security, and should not be relied on as research or investment advice. Information is as of the date indicated and subject to change.

Document must be used in its entirety.

Jackson Square Partners, LLC (JSP) is the sub-advisor to the Fund. As sub-advisor, JSP is responsible for day-to-day management of the Fund’s assets. Although JSP serves as sub-advisor, the investment manager, Delaware Management Company, a series of Delaware Management Business Trust, has ultimate responsibility for all investment advisory services with JSP.

Carefully consider the Fund’s investment objectives, risk factors, charges, and expenses before investing. This and other information can be found in the Fund’s prospectus and its summary prospectus, which may be obtained by clicking the prospectus link located in the right-hand sidebar or calling 800 523-1918. Investors should read the prospectus and the summary prospectus carefully before investing.

Investing involves risk, including the possible loss of principal.

Investments in small and/or medium-sized companies typically exhibit greater risk and higher volatility than larger, more established companies.

International investments entail risks not ordinarily associated with U.S. investments including fluctuation in currency values, differences in accounting principles, or economic or political instability in other nations.

Investing in emerging markets can be riskier than investing in established foreign markets due to increased volatility and lower trading volume.

Not FDIC Insured | No Bank Guarantee | May Lose Value

Fund Finder

Daily pricing (as of 12/17/2014)

Class APriceNet changeYTD
NAV$19.440.330.26%
Max offer price$20.63n/an/a

Total net assets (as of 11/30/2014)

$133.3 million all share classes

Overall Morningstar RatingTM

Load waived

With load

Class A shares (as of 11/30/2014)

Load waivedWith loadNo. of funds
Overall43833
3 Yrs32833
5 Yrs44681
Morningstar categoryWorld Stock

(View Morningstar disclosure)

Lipper ranking (as of 11/30/2014)

YTD ranking153 / 246
1 year147 / 245
3 years125 / 207
5 years22 / 153
10 yearsn/a
Lipper classificationGlobal Multi-Cap Growth

(View Lipper disclosure)

Benchmark, peer group

MSCI World Index (view)

Lipper Global Multi-Cap Growth Funds Average (view)

Additional information